Exhibit 4.2
OH&S DRAFT
11/13/97
[FORM OF SERIES SUPPLEMENT]
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CC CREDIT CARD CORPORATION
Transferor
THE TRAVELERS BANK
Servicer
and
THE BANK OF NEW YORK
Trustee
on behalf of the Series [__________] Holders
SERIES [__________] SUPPLEMENT
Dated as of __________ ____, 19____
to
POOLING AND SERVICING AGREEMENT
Dated as of __________ ____, 19____
TRAVELERS BANK CREDIT CARD MASTER TRUST I
SERIES [__________]
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TABLE OF CONTENTS
Page
ARTICLE I
Creation of the Series [__________] Certificates
Section 1.1 Designation............................................... 1
ARTICLE II
Definitions
Section 2.1. Definitions............................................... 2
ARTICLE III
Servicer and Trustee
Section 3.1. Servicing Compensation.................................... 17
ARTICLE IV
Rights of Series [__________] Certificateholders and Class C Interest
Holder and Allocation and Application of Collections
Section 4.1. Collections and Allocations............................... 17
Section 4.2 Determination of Monthly Interest......................... 20
Section 4.3. Determination of Monthly Principal........................ 21
Section 4.4. Required Amount........................................... 22
Section 4.5. Application of Class A Available Funds, Class B Available
Funds, Class C Available Funds and Available Investor
Principal Collections..................................... 24
Section 4.6. Default Amounts; Investor Charge-Offs..................... 26
Section 4.7. Excess Finance Charge Collections......................... 27
Section 4.8. Reallocated Principal Collections......................... 28
Section 4.10. Shared Principal Collections and Shared Transferor
Principal Collections..................................... 29
[Section 4.11. Determination of [LIBOR].................................. 30
Section 4.12. Principal Funding Account................................. 30
Section 4.13. Class A Accumulation Period............................... 32
Section 4.14. Reserve Account........................................... 32
[Section 4.15. Pre-Funding Account....................................... 34
[Section 4.16. Increases in Invested Amount.............................. 35
Section 4.18. Designation of Class C Interest Terms; Sale of Class C
Interests................................................. 35
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TABLE OF CONTENTS
(continued)
Page
ARTICLE V
Distributions and Reports to Series [__________] Certificateholders
Section 5.1. Distributions............................................. 36
Section 5.2. Certificates and Statements............................... 37
ARTICLE VI
Additional Pay Out Events
Section 6.1. Additional Pay Out Events................................. 38
ARTICLE VII
Optional Repurchase; Series Termination
Section 7.1. Optional Repurchase....................................... 39
Section 7.2. Series Termination........................................ 39
ARTICLE VIII
Final Distributions
Section 8.1. Sale of Receivables or Certificateholders' Interest Pursuant to
Section 2.06 or 10.01 of the Agreement.................... 40
ARTICLE IX
Certificates
Section 9.1. Book-Entry Certificates................................... 41
Section 9.2. Uncertificated Securities................................. 41
ARTICLE X
Miscellaneous Provisions
Section 10.1. Ratification of Agreement................................. 42
Section 10.2. Counterparts.............................................. 42
Section 10.3. Governing Law............................................. 42
Section 10.4. Notices................................................... 42
Section 10.5. Amendments................................................ 42
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SERIES [__________] SUPPLEMENT, dated as of __________ ____, 199__ (the
"Supplement"), among CC CREDIT CARD CORPORATION, a Delaware corporation, as
Transferor, (the "Transferor"), THE TRAVELERS BANK, a Delaware state-chartered
banking corporation, as Servicer (the "Servicer"), and The Bank of New York, a
New York banking corporation, as Trustee (together with its sucessors in trust
thereunder as provided in the Pooling and Servicing Agreement referred to below,
the "Trustee") under the Pooling and Servicing Agreement dated as of __________
____, 199__ (the "Agreement") among the Transferor, the Servicer and the
Trustee.
PRELIMINARY STATEMENT
Pursuant to the Agreement, the Transferor has created the Travelers
Bank Master Credit Card Trust I (the "Trust"). Section 6.03 of the Agreement
provides that the Transferor may from timeto time direct the Trustee to
authenticate one or more new Series of Investor Certificates representing
fractional undivided interests in the Trust. The Principal Terms of any new
Series are due to be set forth in a Supplement to the Agreement.
Pursuant to this Supplement, the Transferor and the Trustee shall
create a new Series of Investor Certificates and specify the Principal Terms
thereof.
ARTICLE I
Creation of the Series [__________] Certificates
Section 1.1 Designation.
(a) There is hereby created a Series of Investor Certificates to be issued
pursuant to the Agreement and this Supplement to be known as "Travelers Bank
Credit Card Master Trust I, Series [__________]." The Series of Investor
Certificates created hereby shall be issued in three Classes. The first Class
shall be known as the "Class A [____%][Floating-Rate] Asset Backed Certificates,
Series [__________]," the second Class shall be known as the "Class B
[____%][Floating-Rate] Asset Backed Certificates, Series [__________]" and the
third Class shall be known as the "Class C [____%] [Floating-Rate] Asset Backed
Interests, Series [__________.]" Except as expressly provided herein, the Class
C Interests shall be deemed to be "Investor Certificates" for all purposes under
the Agreement and this Supplement and shall be in uncertificated form.
Notwithstanding anything to the contrary in the Agreement, (i) none of the Class
B Certificateholders or the Class C Interest Holders shall be considered a
Series Enhancer for Series [__________].
(b) Series [__________] shall be included in Group [One]. Series
[__________] shall be a Principal Sharing Series. Series [__________] shall be
an Excess Allocation Series with respect to Group [One] only. [Series
[__________] shall be entitled to share Excess Transferor Finance Charge
Collections and Shared Transferor Principal Collections.] Series [__________]
shall not be subordinated to any other Series. Notwithstanding any provision in
the Agreement or in this Supplement to the contrary, the first Distribution Date
with respect to Series [__________] shall be the _________ 1998 Distribution
Date, and references herein to the
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Monthly Period relating to the __________ 1998 Distribution Date shall mean the
period from the Closing Date through the end of ___________ 1998.
(c) In the event that any term or provision contained herein shall
conflict with or be inconsistent with any term or provision contained in the
Agreement, the terms and provisions of this Supplement shall govern.
(d) The Class C Interest Holders, as holder of an "Investor Certificate"
under the Agreement, shall be entitled to the benefits of the Agreement and this
Supplement. Notwithstanding the foregoing, except as expressly provided herein,
the provisions of Article VI and Article XII of the Agreement relating to the
registration, authentication, delivery, presentation, cancellation and surrender
of Registered Certificates and clauses (a) and (c) of the definition of "Tax
Opinion" in Section 1.01 of the Agreement shall not be applicable to the Class C
Interests.
ARTICLE II
Definitions
Section 2.1. Definitions
(a) Whenever used in this 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.
"Additional Interest" shall mean, at any time of determination, the Class A
Additional Interest and the Class B Additional.
"Available Investor Principal Collections" shall mean, with respect to any
Monthly Period, an amount equal to the sum of (a) (i) an amount equal to the
Principal Allocation Percentage of all Collections of Principal Receivables
received during such Monthly Period, minus (ii) the amount of Reallocated
Principal Collections with respect to such Monthly Period which pursuant to
Section 4.8 are required to fund any deficiency in the amount to be distributed
pursuant to subsections 4.5(a)(i), (ii) and (iii) or subsectioins 4.5(b)(i) and
(ii) and subsection 4.7(d) for the related Distribution Date, plus (b) any
Shared Principal Collections with respect to other Principal Sharing Series [and
any Shared Transferor Principal Collections] that are allocated to Series
[__________] in accordance with Section 4.04 of the Agreement and subsection
4.10(a) hereof, plus (c) any other amounts which pursuant to subsection
4.5(a)(iii) (including any amounts allocated with respect thereto pursuant to
subsection 4.7(a)) and subsections 4.7(b), (d), (e), (h) and (i) hereof are to
be treated as Available Investor Principal Collections with respect to the
related Distribution Date or subsections 4.5(b)(i) and (ii) and subsection
4.7(d).
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"Average Principal Balance" shall mean, for any Monthly Period in which an
Addition Date or Removal Date occurs, the weighted average of the sum of (i) the
product of the Principal Receivables in the Trust and one minus the Discount
Percentage and (ii) the principal amount on deposit in the Excess Funding
Account at the end of the day on the last day of the prior Monthly Period and
the sum of (i) the product of the Principal Receivables in the Trust and one
minus the Discount Percentage and (ii) the principal amount on deposit in the
Excess Funding Account at the end of the day on the related Addition Date or
Removal Date, weighted, respectively, by a fraction, the numerator of which is
the number of days from and including the first day of such Monthly Period, to
but excluding the related Addition Date or Removal Date, and the denominator of
which is the number of days in such Monthly Period, and by a fraction, the
numerator of which is the number of days from and including the related Addition
Date or Removal Date to and including the last day of such Monthly Period, and
the denominator of which is the number of days in such Monthly Period.
"Base Rate" shall mean, with respect to any Monthly Period, the annualized
percentage equivalent of a fraction, the numerator of which is equal to the sum
of the Class A Monthly Interest, the Class B Monthly Interest, the Class C
Monthly Interest and the Monthly Servicing Fee with respect to the related
Distribution Date and the denominator of which is the Investor Amount as of the
last day of the preceding Monthly Period.
"Book-Entry Register" shall mean the register maintained by the Trustee
providing for the registration of the Class C Interests and transfers thereof.
"Class A Accumulation Period" shall mean, unless a Pay Out Event with
respect to Series [__________] shall have occurred prior thereto, the period
commencing on the Controlled Accumulation Date or such later date as is
determined in accordance with Section 4.13 and ending on the first to occur of
(a) the commencement of the Rapid Amortization Period, (b) the payment in full
to the Class A Certificateholders of the Class A Investor Amount or (c) the
Series Termination Date.
"Class A Accumulation Period Length" shall have the meaning specified in
Section 4.13.
"Class A Additional Interest" shall have the meaning specified in
subsection 4.2(a).
"Class A Available Funds" shall mean, with respect to any Monthly Period,
an amount equal to the sum of (a) the Class A Floating Percentage of the
Collections of Finance Charge Receivables allocated to Series [__________]
(including any [investment earnings on amounts on deposit in the Pre-Funding
Account and any other] amounts that are to be treated as Collections of Finance
Charge Receivables in accordance with the Agreement), (b) the amount of
Principal Funding Investment Proceeds, if any, with respect to such Distribution
Date, and (c) the amount of funds, if any, to be withdrawn from the Reserve
Account which, pursuant to Section 4.14, are required to be included in Class A
Available Funds with respect to such Distribution Date.
"Class A Certificate Rate" shall mean, [____% of per annum] [from the
Closing Date through __________ ____, 199____, from __________ ____, 199____,
through __________
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____, 199____ and with respect to each Interest Period thereafter, a per annum
rate equal to [LIBOR] as determined on the related [LIBOR] Determination Date
for such Interest Period plus the Class A Certificate Rate Spread].
["Class A Certificate Rate Spread" shall mean ___% per annum.]
"Class A Certificateholder" shall mean the Person in whose name a Class A
Certificate is registered in the Certificate Register.
"Class A Certificates" shall mean any one of the Certificates executed by
the Transferor and authenticated by or on behalf of the Trustee, substantially
in the form of Exhibit A-1.
"Class A Expected Final Distribution Date" shall mean the _______ _____
Distribution Date.
"Class A Floating Percentage" shall mean, with respect to any Monthly
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is equal to the Class A Invested Amount as of
the close of business on the last day of the preceding Monthly Period and the
denominator of which is equal to the Invested Amount as of such day; provided,
however, that with respect to the first Monthly Period, the Class A Floating
Percentage shall mean the percentage equivalent of a fraction, the numerator of
which is the Class A Initial Invested Amount and the denominator of which is the
Initial Invested Amount.
"Class A Initial Invested Amount" shall mean $____________.
"Class A Initial Investor Amount" shall mean the aggregate initial
principal balance of the Class A Certificates, which is $_____________.
"Class A Interest Shortfall" shall have the meaning specified in subsection
4.2(a).
"Class A Invested Amount" shall mean, on any date of determination, an
amount equal to (a) the Class A Initial Invested Amount, [plus (b) the amount of
any increases in the Class A Invested Amount during the Funding Period pursuant
to Section 4.16 on or prior to such date,] minus (c) the aggregate amount of
principal payments [(other than principal payments made from amounts on deposit
in the Pre-Funding Account on the first Distribution Date following the end of
the Funding Period)] made to the Class A Certificateholders on or prior to such
date, minus (d) the excess, if any, of the aggregate amount of Class A Investor
Charge-Offs for all prior Distribution Dates over the aggregate amount of Class
A Investor Charge-Offs reimbursed pursuant to subsection 4.6(a) prior to such
date minus (e) the Principal Funding Account Balance.
"Class A Investor Amount" shall mean, on any date of determination, an
amount equal to the sum of (a) the Class A Invested Amount, [(b) the Class A
Floating Percentage of the Pre-Funded Amount] and (c) the Principal Funding
Account Balance.
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"Class A Investor Charge-Off" shall have the meaning specified in
subsection 4.6(a).
"Class A Investor Default Amount" shall mean, with respect to each
Distribution Date, an amount equal to the product of (i) the Investor Default
Amount for the related Monthly Period and (ii) the Class A Floating Percentage
for such Monthly Period.
"Class A Monthly Interest" shall have the meaning specified in subsection
4.2(a).
"Class A Monthly Principal" shall have the meaning specified in subsection
4.3(a).
"Class A Penalty Rate" shall mean the sum of the Class A Certificate Rate
and ___% per annum.
"Class A Principal Percentage" shall mean, with respect to any Monthly
Period (i) during the Revolving Period, the percentage equivalent (which
percentage shall never exceed 100%) of a fraction, the numerator of which is the
Class A Invested Amount as of the last day of the immediately preceding Monthly
Period and the denominator of which is the Invested Amount as of such day and
(ii) during the Controlled Accumulation Period or the Rapid Amortization Period,
the percentage equivalent (which percentage shall never exceed 100%) of a
fraction, the numerator of which is the Class A Invested Amount as of the last
day of the Revolving Period, and the denominator of which is the Invested Amount
as of such last day; provided, however, that with respect to the first Monthly
Period, the Class A Principal Percentage shall mean the percentage equivalent of
a fraction, the numerator of which is the Class A Initial Invested Amount and
the denominator of which is the Initial Invested Amount.
"Class A Required Amount" shall have the meaning specified in subsection
4.4(a).
"Class A Servicing Fee" shall have the meaning specified in Section 3.1.
"Class B Accumulation Period" shall mean, unless a Pay Out Event with
respect to Series [__________] shall have occurred prior thereto, the period
commencing on the first day of the Monthly Period immediately preceding the
Class B Principal Commencement Date and ending on the first to occur thereafter
of (a) the commencement of the Rapid Amortization Period, (b) the payment in
full to the Class B Certificateholders of the Class B Invested Amount or (c) the
Series Termination Date.
"Class B Additional Interest" shall have the meaning specified in
subsection 4.2(b).
"Class B Available Funds" shall mean, with respect to any Monthly Period,
an amount equal to the Class B Floating Percentage of the Collections of Finance
Charge Receivables allocated to Series [__________] (including any [investment
earnings on amounts on deposit in the Pre-Funding Account and any other] amounts
that are to be treated as Collections of Finance Charge Receivables in
accordance with the Agreement).
"Class B Certificate Rate" shall mean, [___% per annum] [from the Closing
Date through __________ ____, 199____, from __________ ____, 199____ through
__________ _____,
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199____, and with respect to each Interest Period thereafter, a per annum rate
equal to [LIBOR] as determined on the related [LIBOR] Determination Date for
such Interest Period plus the Class B Certificate Rate Spread].
["Class B Certificate Rate Spread" shall mean ___% per annum.]
"Class B Certificateholder" shall mean the Person in whose name a Class B
Certificate is registered in the Certificate Register.
"Class B Certificates" shall mean any one of the Certificates executed by
the Transferor and authenticated by or on behalf of the Trustee, substantially
in the form of Exhibit A-2.
"Class B Expected Final Distribution Date" shall mean the _________ _____
Distribution Date.
"Class B Floating Percentage" shall mean, with respect to any Monthly
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is equal to the Class B Invested Amount as of
the close of business on the last day of the preceding Monthly Period and the
denominator of which is equal to the Invested Amount as of such day; provided,
however, that with respect to the first Monthly Period, the Class B Floating
Percentage shall mean the percentage equivalent of a fraction, the numerator of
which is the Class B Initial Invested Amount and the denominator of which is the
Initial Invested Amount.
"Class B Initial Invested Amount" shall mean $__________.
["Class B Initial Investor Amount" shall mean the aggregate initial
principal balance of the Class B Certificates, which is $___________.]
"Class B Interest Shortfall" shall have the meaning specified in subsection
4.2(b).
"Class B Invested Amount" shall mean, on any date of determination, an
amount equal to (a) the Class B Initial Invested Amount, [plus (b) the amount of
any increases in the Class B Invested Amount during the Funding Period pursuant
to Section 4.16 on or prior to such date,] minus (c) the aggregate amount of
principal payments [(other than principal payments made from amounts on deposit
in the Pre-Funding Account on the first Distribution Date following the end of
the Funding Period)] made to the Class B Certificateholders prior to such date
minus (d) the excess, if any, of the aggregate amount of Class B Investor
Charge-Offs for all prior Distribution Dates over the aggregate amount of any
reimbursement of Class B Investor Charge-Offs pursuant to subsection 4.6(b) for
all Distribution Dates preceding such date, minus (e) the amount of Reallocated
Principal Collections allocated on all prior Distribution Dates pursuant to
subsection 4.8(a) (excluding any Reallocated Principal Collections that have
resulted in a reduction in the Class C Invested Amount pursuant to subsection
4.6(c)), minus (f) an amount equal to the amount by which the Class B Invested
Amount has been reduced on all prior Distribution Dates pursuant to subsection
4.6(a) and plus (g) the amount of Excess Finance Charge Collections allocated
and available on all prior Distribution Dates pursuant to subsection
6
4.7(e) for the purpose of reimbursing amounts deducted pursuant to the foregoing
clauses (d), (e) and (f); provided, however, that the Class B Invested Amount
shall not be reduced below zero.
["Class B Investor Amount" shall mean, for any date of determination, an
amount equal to the sum of (a) the Class B Invested Amount and (b) the Class B
Floating Percentage of the Pre-Funded Amount.]
"Class B Investor Charge-Off" shall have the meaning specified in
subsection 4.6(b).
"Class B Investor Default Amount" shall mean, with respect to each
Distribution Date, an amount equal to the product of (i) the Investor Default
Amount for the related Monthly Period and (ii) the Class B Floating Percentage
for such Monthly Period.
"Class B Monthly Interest" shall have the meaning specified in subsection
4.2(b).
"Class B Monthly Principal" shall have the meaning specified in subsection
4.3(b).
"Class B Penalty Rate" shall mean the sum of the Class B Certificate Rate
and ____% per annum.
"Class B Principal Commencement Date" shall mean the Distribution Date on
which the Class A Investor Amount is paid in full or on which the Principal
Funding Account Balance is equal to the Class A Investor Amount; provided, that
if the Class A Investor Amount is paid in full on the Class A Expected Final
Distribution Date and the Rapid Amortization Period has not commenced, the Class
B Principal Commencement Date shall mean the Class B Expected Final Distribution
Date.
"Class B Principal Percentage" shall mean, with respect to any Monthly
Period (i) during the Revolving Period, the percentage equivalent (which
percentage shall never exceed 100%) of a fraction, the numerator of which is the
Class B Invested Amount as of the last day of the immediately preceding Monthly
Period and the denominator of which is the Invested Amount as of such day and
(ii) during the Controlled Accumulation Period or the Rapid Amortization Period,
the percentage equivalent (which percentage shall never exceed 100%) of a
fraction, the numerator of which is the Class B Invested Amount as of the last
day of the Revolving Period, and the denominator of which is the Invested Amount
as of such last day; provided, however, that with respect to the first Monthly
Period, the Class B Principal Percentage shall mean the percentage equivalent of
a fraction, the numerator of which is the Class B Initial Invested Amount and
the denominator of which is the Initial Invested Amount.
"Class B Required Amount" shall have the meaning specified in subsection
4.4(b).
"Class B Servicing Fee" shall have the meaning specified in Section 3.1.
"Class C Available Funds" shall mean, with respect to any Monthly Period,
an amount equal to the Class C Floating Percentage of the Collections of Finance
Charge Receivables allocated to Series [__________] (including any [investment
earnings on amounts on deposit in
7
the Pre-Funding Account and any other] amounts that are to be treated as
Collections of Finance Charge Receivables in accordance with the Agreement).
"Class C Floating Percentage" shall mean, with respect to any Monthly
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is the Class C Invested Amount as of the
close of business on the last day of the preceding Monthly Period and the
denominator of which is equal to the Invested Amount as of such day; provided,
however, that with respect to the first Monthly Period, the Class C Floating
Percentage shall mean the percentage equivalent of a fraction, the numerator of
which is the Class C Initial Invested Amount and the denominator of which is the
Initial Invested Amount.
"Class C Initial Invested Amount" shall mean $__________.
["Class C Initial Investor Amount" shall mean the aggregate initial
principal balance of the Class C Interest, which is $__________.]
"Class C Interests" shall mean a fractional undivided interest in the Trust
which shall consist of the right to receive, to the extent necessary to make the
required payments to the Class C Interest Holder under this Supplement the
portion of Collections allocable thereto under the Agreement and this
Supplement, funds on deposit in the Collection Account allocable thereto
pursuant to the Agreement and this Supplement [and, funds on deposit in the
Pre-Funding Account].
"Class C Interest Holder" shall mean the Person in whose name a Class C
Interest is registered in the Book-Entry Register, which initially shall be the
Transferor.
"Class C Interest Rate" shall mean, with respect to each Interest Period, a
per annum rate equal to 0%; provided, however, that such interest rate may be
increased pursuant to the terms of a supplemental agreement entered into in
acordance with Section 4.17.
"Class C Invested Amount" shall mean, for any date of determination, an
amount equal to (a) the Class C Initial Invested Amount, [plus (b) the amount of
any increases in the Class C Invested Amount during the Funding Period pursuant
to Section 4.16 on or prior to such date,] minus (c) an amount equal to the
amount by which the Class C Invested Amount has been reduced on all prior
Distribution Dates pursuant to Section 4.6, minus (d) the aggregate amount paid
pursuant to subsections 4.5(d)(i) and 4.5(e)(iii) prior to such date, and plus
(e) the aggregate amount of Excess Finance Charge Collections allocated and
available on all prior Distribution Dates pursuant to subsection 4.7(i) for the
purpose of reimbursing amounts deducted pursuant to the foregoing clause (c);
provided, however, that the Class C Invested Amount shall not be reduced below
zero.
["Class C Investor Amount" shall mean, for any date of determination, an
amount equal to the sum of (a) the Class C Invested Amount and (b) the Class C
Floating Percentage of the Pre-Funded Amount.]
8
"Class C Investor Default Amount" shall mean, with respect to each
Distribution Date, an amount equal to the product of (i) the Investor Default
Amount for the related Monthly Period and (ii) the Class C Floating Percentage
for such Monthly Period.
"Class C Monthly Interest" shall mean the interest, if any, distributable
in respect of the Class C Interest as such interest may be calculated in a
supplemental agreement entered into in accordance with Section 4.17.
"Class C Monthly Principal" shall have the meaning specified in subsection
4.3(c).
"Class C Principal Percentage" shall mean, with respect to any Monthly
Period, a percentage (which shall never exceed 100% or be less than 0%) equal to
the difference between 100% and the sum of the Class A Principal Percentage and
the Class B Principal Percentage for such Monthly Period.
"Class C Servicing Fee" shall have the meaning specified in Section 3.1.
"Closing Date" shall mean __________ ____, 199____.
"Controlled Accumulation Amount" shall mean (a) for any Distribution Date
with respect to the Class A Accumulation Period, the maximum Class A Invested
Amount during the Revolving Period divided by twelve; provided, however, that,
if the Class A Accumulation Period is modified pursuant to Section 4.13, (i) the
Controlled Accumulation Amount for each Distribution Date with respect to the
Class A Accumulation Period shall mean the amount determined in accordance with
Section 4.13 on the date on which the Class A Accumulation Period has most
recently been modified and (ii) the sum of the Controlled Accumulation Amounts
for all Distribution Dates with respect to the modified Class A Accumulation
Period shall not be less than the maximum Class A Invested Amount during the
Revolving Period and (b) for any Distribution Date with respect to the Class B
Accumulation Period, the maximum Class B Invested Amount during the Revolving
Period.
"Controlled Accumulation Date" shall mean the close of business on
_____________ __, ________.
"Controlled Accumulation Period" shall mean the Class A Accumulation Period
and the Class B Accumulation Period.
""Controlled Deposit Amount" shall mean, for any Distribution Date with
respect to the Controlled Accumulation Period, an amount equal to the sum of the
Controlled Accumulation Amount for such Distribution Date and any Deficit
Controlled Accumulation Amount for the immediately preceding Distribution Date.
"Covered Amount" shall mean for any Distribution Date with respect to the
Class A Accumulation Period or the first Special Payment Date, if such Special
Payment Date occurs prior to the Class B Principal Commencement Date, an amount
equal to the product of (i) (A) a fraction, the numerator of which is the actual
number of days in the period from and including
9
the preceding Distribution Date to but excluding such Distribution Date and the
denominator of which is 360, times (B) the Class A Certificate Rate and (ii) the
Principal Funding Account Balance, if any, as of the preceding Distribution
Date.
"Deficit Controlled Accumulation Amount" shall mean (a) on the first
Distribution Date with respect to the Class A Accumulation Period or the Class B
Accumulation Period, the excess, if any, of the Controlled Accumulation Amount
for such Distribution Date over the amount distributed from the Collection
Account as Class A Monthly Principal or Class B Monthly Principal, as the case
may be, for such Distribution Date and (b) on each subsequent Distribution Date
with respect to the Class A Accumulation Period or the Class B Accumulation
Period, the excess, if any, of the Controlled Deposit Amount for such subsequent
Distribution Date over the amount distributed from the Collection Account as the
case may be, for such subsequent Distribution Date.
["Designated Maturity" shall mean, for any [LIBOR] Determination Date, one
month[; provided, that [LIBOR] for the initial Interest Period will be
determined by straight-line interpolation (based on the actual number of days in
the initial Interest Period) between the rates determined as described in
Section 4.11 for a Designated Maturity of one month and a Designated Maturity of
two months].]
"Excess finance Charge Collections" shall mean, for Series [____________]
and any Distribution Date, the sum of Excess Spread for such Distribution Date
and Excess Finance Charges [and Excess Transferor Finance Charge Collections]
allocated to Series [____________] for such Distribution Date.
"Excess Finance Charges" shall mean, for Series [__________] and any
Distribution Date, amounts allocated pursuant to Section 4.04 of the Agreement
to Series [__________] for such Distribution Date.
"Excess Spread" shall mean, with respect to any Distribution Date, the sum
of the amounts, if any, specified pursuant to subsections 4.5(a)(iv),
4.5(b)(iii) and 4.5(c)(ii) with respect to such Distribution Date.
"Finance Charge Shortfall" shall have the meaning specified in subsection
4.9(a).
"Fitch" shall mean Fitch Investors Service, L.P., or its successors.
"Floating Allocation Percentage" shall mean, with respect to any Monthly
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is the Invested Amount as of the last day of
the preceding Monthly Period (or with respect to the first Monthly Period, the
Initial Invested Amount) and the denominator of which is the greater of (1) the
sum of (x) the product of the total amount of Principal Receivables in the Trust
at the end of the day on such date (or with respect to the first Monthly Period,
at the end of the day on the Closing Date) and one minus the Discount Percentage
and (y) the principal amount on deposit in the Excess Funding Account as of the
end of the day on such date and (2) the sum of the numerators used to calculate
the Series Percentages (as such term is defined in the
10
Agreement) with respect to Finance Charge Receivables or Defaulted Receivables,
as applicable, for all Series then outstanding; provided, however, that, with
respect to any Monthly Period in which an Addition Date or a Removal Date occurs
and the Servicer need not make daily deposits of Collections into the Collection
Account, the denominator in (x) above shall be the Average Principal Balance;
provided further, however, that with respect to any Monthly Period in which an
Addition Date or a Removal Date occurs and the Servicer is required to make
daily deposits of Collections into the Collection Account, the denominator in
(x) above shall be (1) for the period from and including the first day of such
Monthly Period to but excluding the related Addition Date or Removal Date, the
aggregate amount of Principal Receivables in the Trust at the end of the day on
the last day of the prior Monthly Period and (2) for the period from and
including the related Addition Date or Removal Date to and including the last
day of such Monthly Period, the aggregate amount of Principal Receivables in the
Trust at the end of the day on the related Addition Date or Removal Date.
["Funding Period" shall mean the period commencing on the Closing Date and
ending upon the first to occur of (x) the commencement of the Rapid Amortization
Period, (y) the date on which the Invested Amount shall first equal the Initial
Investor Amount and (z) ________ __, 199____.]
"Group [One]" shall mean Series [_________] and each other Series hereafter
specified in the related Supplement to be included in Group [One].
"Initial Invested Amount" shall mean the sum of the Class A Initial
Invested Amount, the Class B Initial Invested Amount and the Class C Initial
Invested Amount.
"Initial Investor Amount" shall mean the sum of the Class A Initial
Investor Amount, the Class B Initial Investor Amount and the Class C Initial
Investor Amount.
["Initial Pre-Funded Amount" shall mean $___________.]
"Initial Servicing Fee" shall have the meaning specified in Section 3.1.
"Interest Period" shall mean, with respect to any Distribution Date, the
period from and 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.
"Invested Amount" shall mean, as of any date of determination, an amount
equal to the sum of (a) the Class A Invested Amount as of such date, (b) the
Class B Invested Amount as of such date and (c) the Class C Invested Amount as
of such date.
"Investor Amount" shall mean, as of any date of determination, an amount
equal to the sum of (a) the Invested Amount, (b) [the Pre-Funded Amount and
(c)]the Principal Funding Account Balance.
11
"Investor Charge-Offs" shall mean Class A Investor Charge-Offs and Class B
Investor Charge-Offs.
"Investor Default Amount" shall mean, with respect to any Distribution
Date, an amount equal to the product of (a) the Defaulted Amount for the related
Monthly Period and (b) the Floating Allocation Percentage for such Monthly
Period.
["LIBOR" shall mean an interest rate per annum determined by the Trustee
for each Interest Period in accordance with the provisions of Section 4.11.]
["[LIBOR] Determination Date" shall mean __________ ____, 199____ with
respect to the period from the Closing Date through __________ 15, 199____; and,
with respect to each Interest Period thereafter, the [second London Business
Day] prior to every Distribution Date on which such Interest Period begins
commencing with the ___________ 199____ Distribution Date.]
["London Business Day" shall mean a Business Day on which dealings in
deposits in United States dollars are transacted in the London interbank
market.]
"Monthly Interest" means, with respect to any Distribution Date, the Class
A Monthly Interest, the Class B Monthly Interest and the Class C Monthly
Interest for such Distribution Date.
"Monthly Servicing Fee" shall have the meaning specified in Section 3.1.
"Net Portfolio Yield" shall mean, with respect to any Monthly Period, the
annualized percentage equivalent of a fraction, the numerator of which is equal
to (a) an amount equal to the product obtained by multiplying the Floating
Allocation Percentage with respect to such Monthly Period and the amount of
Collections of Finance Charge Receivables with respect to such Monthly Period
(including any other amounts that are to be treated as Collections of Finance
Charge Receivables in accordance with the Agreement), [plus (b) any investment
earnings on amounts on deposit in the Pre-Funding Account,] plus (c) the amount
of any Principal Funding Investment Proceeds for the related Distribution Date,
plus (d) the amount of funds, if any, to be withdrawn from the Reserve Account
which, pursuant to Section 4.14, are required to be included in Class A
Available Funds with respect to such Distribution Date, minus (e) the Investor
Default Amount for the Distribution Date with respect to such Monthly Period,
and the denominator of which is the Investor Amount as of the last day of the
preceding Monthly Period.
"Percentage Allocation" shall have the meaning specified in subsection
4.1(b)(ii).
["Pre-Funded Amount" shall mean, as of any date of determination, the
amount on deposit in the Pre-Funding Account (net of all interest and other
investment income).]
["Pre-Funding Account" shall have the meaning set forth in subsection
4.15(a).]
"Principal Allocation Percentage" shall mean, with respect to any Monthly
Period:
12
(a) during the Revolving Period, the percentage equivalent (which
percentage shall never exceed 100%) of a fraction, (x) the numerator of which is
the Invested Amount as of the last day of the immediately preceding Monthly
Period (or, in the case of the first Monthly Period, the Closing Date) and (y)
the denominator of which is the greater of (i) the sum of (A) the product of the
total amount of Principal Receivables in the Trust as of the last day of the
immediately preceding Monthly Period and one minus the Discount Percentage and
(B) the principal amount on deposit in the Excess Funding Account as of such
last day (or, in the case of the first Monthly Period, the Closing Date) and
(ii) the sum of the numerators used to calculate the Series Percentages
applicable to Principal Receivables for all Series outstanding as of the date as
to which such determination is being made;
(b) during the Controlled Accumulation Period or the Rapid Amortization
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, (x) the numerator of which is the Invested Amount as of the last day
of the Revolving Period and (y) the denominator of which is the greater of (i)
the sum of (A) the product of the total amount of Principal Receivables in the
Trust as of the last day of the immediately preceding Monthly Period and one
minus the Discount Percentage and (B) the principal amount on deposit in the
Excess Funding Account as of such last day and (ii) the sum of the numerators
used to calculate the Series Percentages applicable to Principal Receivables for
all Series outstanding as of the date as to which such determination is being
made;
provided however, that with respect to any Monthly Period in which an
Addition Date or a Removal Date occurs and the Servicer need not make daily
deposits of Collections into the Collection Account, the amount in clause (y)
(i) of paragraphs (a) and (b) above shall be the Average Principal Balance;
provided further, however, that with respect to any Monthly Period in which an
Addition Date or a Removal Date occurs and the Servicer is required to make
daily deposits of Collections into the Collection Account, the amount in clause
(y) (i) of paragraphs (a) and (b) above shall be (1) for the period from and
including the first day of such Monthly Period to but excluding the related
Addition Date or Removal Date, the sum of (x) the product of the aggregate
amount of Principal Receivables in the Trust at the end of the day on the last
day of the prior Monthly Period and one minus the Discount Percentage and (y)
the principal amount on deposit in the Excess Funding Account as of such last
day and (2) for the period from and including the related Addition Date or
Removal Date to and including the last day of such Monthly Period, the sum of
(x) the product of the aggregate amount of Principal Receivables in the Trust at
the end of the day on the related Addition Date or Removal Date and one minus
the Discount Percentage and (y) the principal amount on deposit in the Excess
Funding Account at the end of the day on the related Addition Date or Removal
Date.
"Principal Funding Account" shall have the meaning set forth in subsection
4.12(a)(i).
"Principal Funding Account Balance" shall mean, with respect to any date of
determination during the Controlled Accumulation Period, the principal amount,
if any, on deposit in the Principal Funding Account on such date of
determination.
13
"Principal Funding Investment Proceeds" shall have the meaning specified in
subsection 4.12(a)(ii).
"Principal Shortfall" shall have the meaning specified in Section 4.10.
"Rapid Amortization Period" shall mean, (a) if on the day on which a Pay
Out Event with respect to Series [__________] is deemed to have occurred the
Servicer need not make daily deposits into or withdrawals from the Collection
Account pursuant to subsection 4.03(a) of the Agreement, the period commencing
at the close of business on the Business Day immediately preceding the first day
of the Monthly Period in which such Pay Out Event is deemed to have occurred or
(b) otherwise, the period commencing at the close of business on the Business
Day immediately preceding the day on which a Pay Out Event with respect to
Series [__________] is deemed to have occurred, and ending on the first to occur
of (i) the payment in full to the Class A Certificateholders and the Class B
Certificateholders of the Class A Investor Amount and the Class B Invested
Amount, respectively, and the payment in full to the Class C Interest Holder of
the Class C Invested Amount, if any, or (ii) the Series Termination Date.
"Reallocated Principal Collections" shall mean, with respect to any Monthly
Period, the product of (a) the Principal Allocation Percentage with respect to
such Monthly Period, (b) the aggregate amount of Collections in respect of
Principal Receivables for such Monthly Period and (c) the sum of the Class B
Principal Percentage and the Class C Principal Percentage with respect to such
Monthly Period.
"Reassignment Amount" shall mean, with respect to any Distribution Date,
after giving effect to any deposits and distributions otherwise to be made on
such Distribution Date, the sum of (i) the Invested Amount on such Distribution
Date, plus (ii) Monthly Interest for such Distribution Date and any Monthly
Interest previously due but not distributed to the Series [__________] Holders
on a prior Distribution Date, 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 [__________] Holders on a prior Distribution Date.
["Reference Banks" shall mean ____________________, _________________ and
_____________________ or such other major banks in the London interbank market
selected by the Servicer from time to time.]
"Required Class C Invested Amount" shall mean, with respect to any
Distribution Date, the greater of (i) the product of (a) the sum of (I) [the sum
of] the Class A Invested Amount [and the Class A Floating Percentage of the
Pre-Funded Amount] and (II) [the sum of the Class B Invested Amount] [and the
Class B Floating Percentage of the Pre-Funded Amount,] each as of such
Distribution Date after taking into account all distributions made on such
Distribution Date, and (b) a fraction, the numerator of which is __% and the
denominator of which is the excess of 100% over __% and (ii) the product of (A)
$___________ and (B) ___%; provided, however, that (i) if there are any
reductions in the Class C Invested Amount pursuant to clause [(b)][(c)] of the
definition of such amount, or a Pay Out Event occurs with respect to Series
[__________], then the Required Class C Invested Amount for any Distribution
Date shall equal the Required Class C Invested Amount on the Distribution Date
immediately preceding such reduction or Pay
14
Out Event, (ii) in no event shall the Required Class C Invested Amount exceed
the sum of the Class A Invested Amount and the Class B Invested Amount on any
such date, and (iii) the Required Class C Invested Amount may be reduced without
the consent of the Series [__________] Holders, if the Transferors shall have
received written notice from each Rating Agency (with a copy delivered to the
Trustee) that such reduction will not result in the reduction or withdrawal of
the then current rating of the Series [__________] Certificates and the
Transferor shall have delivered to the Trustee an Officer's Certificate to the
effect that, based on the facts known to such officer at such time, in the
reasonable belief of the Transferor, such reduction will not cause a Pay Out
Event or an event that, after the giving of notice or the lapse of time, would
constitute a Pay Out Event, to occur with respect to Series [__________].
"Required Reserve Account Amount" shall mean, with respect to any
Distribution Date prior to the Reserve Account Funding Date, $0, and on or after
the Reserve Account Funding Date, an amount equal to (a) the product of (i)
____% of the Class A Investor Amount as of the preceding Distribution Date
(after giving effect to all changes therein on such date) and (ii) a fraction,
the numerator of which is the number of Monthly Periods scheduled to be included
in the Class A Accumulation Period as of such date and the denominator of which
is twelve (except that if such numerator is one, the Required Reserve Account
Amount determined pursuant to this clause (a) shall be $0) or (b) any other
amount designated by the Transferor, provided that, if such designation is of a
lesser amount, the Transferor (i) shall have received written notice from each
Rating Agency that such designation will not result in the reduction or
withdrawal of the rating of the Series [__________] Certificates and shall have
delivered copies of each such written notice to the Servicer and the Trustee,
and (ii) shall have delivered to the 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 Transferor, such designation will not
cause a Pay Out Event or an event that, after the giving of notice or the lapse
of time, would cause a Pay Out Event, to occur with respect to Series
[__________].
"Reserve Account" shall have the meaning specified in subsection 4.14(a).
"Reserve Account Funding Date" shall mean the Distribution Date with
respect to the Monthly Period which commences three months prior to the Monthly
Period in which, as of the related Determination Date, the Controlled
Accumulation Period is scheduled to commence.
"Reserve Account Surplus" shall mean, as of any date of determination, the
amount, if any, by which the amount on deposit in the Reserve Account exceeds
the Required Reserve Account Amount.
"Reserve Draw Amount" shall have the meaning specified in subsection
4.14(c).
"Revolving Period" shall mean the period beginning on the Closing Date and
ending on the earlier of (a) the close of business on the day preceding the
commencement of the Controlled Accumulation Period and (b) the close of business
on the day preceding the commencement of the Rapid Amortization Period.
"Series Invested Amount" shall mean the Invested Amount.
15
"Series Investor Amount" shall mean, as of any date of determination, an
amount equal to the numerator of the Principal Allocation Percentage on such
date.
"Series [__________]" shall mean the Series of Investor Certificates, the
terms of which are specified in this Supplement, and shall include the Class A
Certificates, the Class B Certificates and the Class C Interests.
"Series [__________] Certificateholder" shall mean a Class A
Certificateholder or a Class B Certificateholder.
"Series [__________] Certificate" shall mean a Class A Certificate or a
Class B Certificate.
"Series [__________] Holder" shall mean a Class A Certificateholder, a
Class B Certificateholder or a Class C Interest Holder.
"Series Percentage" shall mean with respect to Finance Charge Receivables
and Defaulted Receivables, the Floating Allocation Percentage, and with respect
to Principal Receivables, the Principal Allocation Percentage.
"Series Termination Date" shall mean the earlier to occur of (i) the
_______ ____ Distribution Date and (ii) the termination of the Trust pursuant to
Section 12.01 of the Agreement.
"Servicing Base Amount" shall have the meaning specified in Section 3.1.
"Servicing Fee Rate" shall mean ____%.
"Special Payment Date" shall mean each Distribution Date with respect to
the Rapid Amortization Period.
"Subordinate Principal Collections" shall have the meaning specified in
subsection 4.1(a)(ii).
["Telerate Page 3750" shall mean the display page currently so designated
on the Dow Xxxxx Telerate Service (or such other page as may replace such page
on such service for the purpose of displaying comparable rates or prices).]
(b) Notwithstanding anything to the contrary in this Supplement
or the Agreement, the term "Rating Agency" shall mean, whenever used in this
Supplement or the Agreement with respect to Series [__________], [Xxxxx'x and
Standard & Poor's].
(c) All capitalized terms used herein and not otherwise defined
herein have the meanings ascribed to them in the Agreement.
16
(d) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Supplement shall refer to this Supplement as a
whole and not to any particular provision of this Supplement; references to any
Article, Section or Exhibit are references to Articles, Sections and Exhibits in
or to this Supplement unless otherwise specified; and the term "including" means
"including without limitation."
(e) Unless the context otherwise requires, references in this
Supplement to the Transferor shall initially mean CC Credit Corporation in its
capacity as Transferor; and from and after the date any Additional Transferor is
designated pursuant to subsection 2.09(e) of the Agreement, such references
shall mean CC Credit Card Corporation in its capacity as Transferor and any such
Additional Transferor(s).
ARTICLE III
Servicer and Trustee
Section 3.1. Servicing Compensation.
The share of the Servicing Fee allocable to the Series [__________] Holders
with respect to any Distribution Date (the "Monthly Servicing Fee"), shall be
equal to one-twelfth the product of (i) the Servicing Fee Rate and (ii) the
Invested Amount, if any, as of the last day of the Monthly Period preceding such
Distribution Date (the amount calculated pursuant to this clause (ii) is
referred to as the "Servicing Base Amount"); provided, however, with respect to
the December 1996 Distribution Date, the Monthly Servicing Fee (the "Initial
Servicing Fee") shall be $________.
The share of the Monthly Servicing Fee allocable to the Class A
Certificateholders with respect to any Distribution Date (the "Class A Servicing
Fee"), shall be equal to one-twelfth of the product of (a) the Class A Floating
Percentage, (b) the Servicing Fee Rate and (c) the Servicing Base Amount;
provided, however, that with respect to the ___________ 199____ Distribution
Date, the Class A Servicing Fee shall be $_________. The share of the Monthly
Servicing Fee allocable to the Class B Certificateholders with respect to any
Distribution Date (the "Class B Servicing Fee"), shall be equal to one-twelfth
of the product of (a) the Class B Floating Percentage, (b) the Servicing Fee
Rate and (c) the Servicing Base Amount; provided, however, that with respect to
the __________ 199____ Distribution Date, the Class B Servicing Fee shall be
$________. The share of the Monthly Servicing Fee allocable to the Class C
Interest Holder with respect to any Distribution Date (the "Class C Servicing
Fee"), shall be equal to one-twelfth of the product of (a) the Class C Floating
Percentage, (b) the Servicing Fee Rate and (c) the Servicing Base Amount;
provided, however, that with respect to the __________ 199____ Distribution
Date, the Class C Servicing Fee shall be $_________. The remainder of the
Servicing Fee shall be paid by the Holders of the Transferor Certificates or the
Certificateholders of other Series (as provided in the related Supplements) and
in no event shall the Trust, the Trustee, the Series [__________] Holders be
liable for the share of the Servicing Fee to be paid by the Holders of the
Transferor Certificates or the Certificateholders of any other Series. The
Class A Servicing Fee shall be payable to the Servicer solely to the extent
amounts are available for distribution in respect thereof pursuant to subsection
4.5(a)(ii), 4.7(a) or 4.8(a);
17
the Class B Servicing Fee shall be payable solely to the extent amounts are
available for distribution in respect thereof pursuant to subsection 4.5(b)(ii),
4.7(c) or 4.8(b); and the Class C Servicing Fee shall be payable solely to the
extent amounts are available for distribution in respect thereof pursuant to
subsection 4.5(c)(i) or 4.7(g).
ARTICLE IV
Rights of Series [__________] Certificateholders and Class C Interest
Holder and Allocation and Application of Collections
Section 4.1. Collections and Allocations The Servicer will apply, or
will instruct the Trustee to apply, all collections and other funds on deposit
in the Collection Account that are allocated to the Series [__________] Holders
as follows:
(a) Daily Allocations During the Revolving Period. During the
Revolving Period, the Servicer shall, on or prior to the close of business on
the second Business Day following any Date of Processing, allocate the
following amounts as set forth below:
(i) Allocate to the Series [__________] Holders the product of
(x) the Floating Allocation Percentage on such Date of Processing and (y)
the aggregate amount of Collections of Finance Charge Receivables on such
Date of Processing, and of that allocation, deposit and retain in the
Collection Account [(A) prior to the [LIBOR] Determination Date occurring
in such Monthly Period, an amount equal to the product of (v) the
Floating Allocation Percentage on such Date of Processing and (w) the
aggregate amount of Collections of Finance Charge Receivables on such
Date of Processing and (B) on and after such [LIBOR] Determination Date,]
an amount equal to the difference between (1) Monthly Interest for the
related Distribution Date (plus, if The Travelers Bank is not the
Servicer, the Monthly Servicing Fee for such Monthly Period) and (2) the
amounts previously deposited in the Collection Account with respect to
such Monthly Period pursuant to this subsection (a)(i);
(ii) Allocate to the Series [__________] Holders an amount equal
to the product of (A) the Principal Allocation Percentage on such Date of
Processing and (B) the aggregate amount of Collections of Principal
Receivables on such Date of Processing, which amount shall be first, if
any other Principal Sharing Series is outstanding and in its Amortization
Period or Accumulation Period (as such terms are defined in the
Agreement), retained in the Collection Account for application, to the
extent necessary, as Shared Principal Collections in accordance with
Section 4.04 of the Agreement to other Series on the related Distribution
Date, and second paid to the Holders of the Transferor Certificates;
provided however, that the amount to be paid to the Holders of the
Transferor Certificates pursuant to this subsection 4.1(a)(ii) on any
Date of Processing shall be paid to such Holders only if the Transferor
Amount on such Date of Processing is greater than the Required Transferor
Amount and an amount equal to the product of (I) the aggregate amount of
Principal Receivables and (II) one minus the Discount Percentage is
greater than the Required Principal Balance (after giving effect to
18
all Principal Receivables transferred to the Trust on such day and any
amounts deposited in the Excess Funding Account on such day) and
otherwise shall be deposited in the Excess Funding Account until the
Transferor Amount is greater than the Required Transferor Amount and an
amount equal to the product of (I) the aggregate amount of Principal
Receivables and (II) one minus the Discount Percentage is greater than
the Required Principal Balance and applied in accordance with Section
4.02 of the Agreement and the remainder shall be paid to the Holders of
the Transferor Certificates; provided further, however, that if and for
so long as the Class C Invested Amount is less than the Required Class C
Invested Amount during a Monthly Period, an amount equal to the sum of
(x) the Class C Principal Percentage of the product of the Principal
Allocation Percentage and the aggregate amount of Collections of
Principal Receivables and (y) the Class B Principal Percentage of the
product of the Principal Allocation Percentage and the aggregate amount
of Collections of Principal Receivables ("Subordinate Principal
Collections") on each Date of Processing with respect to such Monthly
Period shall be deposited and retained in the Collection Account during
such Monthly Period.
(b) Daily Allocations During the Controlled Accumulation Period. During
the Controlled Accumulation Period, the Servicer shall, prior to the close of
business on the second Business Day following any Date of Processing, allocate
the following amounts as set forth below:
(i) Allocate to the Series [__________] Holders and deposit and
retain in the Collection Account an amount equal to the product of (A)
the Floating Allocation Percentage on such Date of Processing and (B) the
aggregate amount of Collections of Finance Charge Receivables on such
Date of Processing.
(ii) Allocate to the Series [__________] Holders and deposit and
retain in the Collection Account an amount equal to the product of
(x) the Principal Allocation Percentage on such Date of Processing and
(y) the aggregate amount of Collections of Principal Receivables on such
Date of Processing (for any such date, a "Percentage Allocation");
provided, however, that if the sum of such Percentage Allocations with
respect to the same Monthly Period exceeds the Controlled Deposit Amount
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 (as such terms are defined in the Agreement),
retained in the Collection Account for application, to the extent
necessary, as Shared Principal Collections in accordance with Section
4.04 of the Agreement to other Series on the related Distribution Date,
and second paid to the Holders of the Transferor Certificates only if the
Transferor Amount on such Date of Processing is greater than the Required
Transferor Amount and an amount equal to the productof (I) the aggregate
amount of Principal Receivables and (II) one minus the Discount
Percentage is greater than the Required Principal Balance (after giving
effect to all Principal Receivables transferred to the Trust on such day
and any amounts deposited in the Excess Funding Account on such day) and
otherwise shall be deposited in the Excess Funding Account until the
Transferor Amount is greater than the Required Transferor Amount and an
amount equal to the product of (I) the aggregate amount of Principal
19
Receivables and (II) one minus the Discount Percentage is greater than
the Required Principal Balance and applied in accordance with Section
4.02 of the Agreement and the remainder shall be paid to the Holders of
the Transferor Certificates; provided further, however, that if and for
so long as the Class C Invested Amount is less than the Required Class C
Invested Amount for a Monthly Period, Subordinate Principal Collections
with respect to each Date of Processing with respect to such Monthly
Period shall be retained in the Collection Account during such Monthly
Period.
(c) Daily Allocations During the Rapid Amortization Period. During the
Rapid Amortization Period, the Servicer shall, prior to the close of business on
the second Business Day following any Date of Processing, allocate the following
amounts as set forth below:
(i) Allocate to the Series [__________] Holders and deposit and
retain in the Collection Account an amount equal to the product of (A)
the Floating Allocation Percentage on such Date of Processing and (B) the
aggregate amount of Collections of Finance Charge Receivables on such
Date of Processing.
(ii) Allocate to the Series [__________] Holders and deposit and
retain in the Collection Account an amount equal to the product of (A)
the Principal Allocation Percentage on such Date of Processing and (B)
the aggregate amount of Collections of Principal Receivables on such Date
of Processing; provided, however, that after the date on which an amount
of such Collections equal to the Investor Amount has been deposited into
the Collection Account and allocated to the Series [__________] Holders,
the amount determined in accordance with this subparagraph (ii) in excess
thereof shall be first, if any other Principal Sharing Series is
outstanding and in its Amortization Period or Accumulation Period (as
such terms are defined in the Agreement), retained in the Collection
Account for application, to the extent necessary, as Shared Principal
Collections in accordance with Section 4.04 of the Agreement to other
Series on the related Distribution Date, and second paid to the Holders
of the Transferor Certificates only if the Transferor Amount on such Date
of Processing is greater than the Required Transferor Amount and an
amount equal to the product of (I) the aggregate amount of Principal
Receivables and (II) one minus the Discount Percentage is greater than
the Required Principal Balance (after giving effect to all Principal
Receivables transferred to the Trust on such day and any amounts
deposited in the Excess Funding Account on such day) and otherwise shall
be deposited in the Excess Funding Account until the Transferor Amount is
greater than the Required Transferor Amount and an amount equal to the
product of (I) the aggregate amount of Principal Receivables and (II) one
minus the Discount Percentage is greater than the Required Principal
Balance and applied in accordance with Section 4.02 of the Agreement and
the remainder shall be paid to the Holders of the Transferor Certificates.
(d) Notwithstanding the foregoing, the Servicer need not make daily
deposits of Collections into the Collection Account at any time when the
requirements of Section 4.03 of the Agreement are satisfied.
Section 4.2 Determination of Monthly Interest.
20
(a) The amount of monthly interest ("Class A Monthly Interest")
distributable from the Collection Account with respect to the Class A
Certificates on each Distribution Date shall be an amount equal to the
[one -twelfth of] product of (i) [(A) a fraction, the numerator of which is
the actual number of days in the related Interest Period and the denominator of
which is 360, times (B)] the Class A Certificate Rate and (ii) the outstanding
principal amount of the Class A Certificates as of the close of business on the
preceding Record Date; provided, however, with respect to the ___________
199____ Distribution Date, Class A Monthly Interest shall be equal to the
interest accrued on the Class A Initial Investor Amount at the applicable
Class A Certificate Rate for the period from the Closing Date to but
excluding __________ 15, 199____.
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 with respect to any
Distribution Date is greater than zero, an additional amount ("Class C
Additional Interest") equal to [one-twelfth of] the product of (i) [(A) a
fraction, the numerator of which is the actual number of days from and including
the preceding Distribution Date to but excluding such Distribution Date and the
denominator of which is 360, times (B)] the Class A Penalty Rate and (ii) such
Class A Interest Shortfall (or the portion thereof which has not been paid to
the Class A Certificateholders) shall be payable as provided herein with respect
to the Class A Certificates on each Distribution Date following such
Distribution Date to and including the Distribution Date on which such Class A
Interest Shortfall is paid to the Class A Certificateholders. Notwithstanding
anything to the contrary herein, Class A Additional Interest shall be payable or
distributed to Class A Certificateholders only to the extent permitted by
applicable law.
(b) The amount of monthly interest ("Class B Monthly Interest")
distributable from the Collection Account with respect to the Class B
Certificates on each Distribution Date shall be an amount equal to [one-twelfth
of] the product of (i) [(A) a fraction, the numerator of which is the actual
number of days in the related Interest Period and the denominator of which is
360, times (B)] the Class B Certificate Rate and (ii) the outstanding principal
amount of the Class B Certificates as of the close of business on the preceding
Record Date; provided, however, with respect to the ___________ 199____
Distribution Date, Class B Monthly Interest shall be equal to the interest
accrued on the Class B Initial Investor Amount at the applicable Class B
Certificate Rate for the period from the Closing Date to but excluding _________
15, 199____.
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 with respect to any
Distribution Date is greater than zero, an additional amount ("Class B
Additional Interest") equal to [one-twelfth of] the product of (i) [(A) a
fraction, the numerator of which is the actual number of days in the period from
and including the preceding Distribution Date to but excluding such Distribution
Date and the denominator of which is 360, times (B)] the Class B Penalty Rate
and (ii) such Class B Interest Shortfall (or the portion thereof which has not
been
21
paid to the Class B Certificateholders) shall be payable as provided herein with
respect to the Class B Certificates on each Distribution Date following such
Distribution Date to and including the Distribution Date on which such Class B
Interest Shortfall is paid to the Class B Certificateholders. Notwithstanding
anything to the contrary herein, Class B Additional Interest shall be payable or
distributed to Class B Certificateholders only to the extent permitted by
applicable law.
Section 4.3. Determination of Monthly Principal.
(a) The amount of monthly principal ("Class A Monthly Principal")
distributable from the Collection Account with respect to the Class A
Certificates on each Distribution Date, beginning with the first Distribution
Date with respect to the Class A Accumulation Period or the Rapid Amortization
Period, shall be equal to the least of (x) the Available Investor Principal
Collections on deposit in the Collection Account with respect to such
Distribution Date, (y) for each Distribution Date with respect to the Class A
Accumulation Period (and on or prior to the Class A Expected Final Distribution
Date), the Controlled Deposit Amount for such Distribution Date and (z) the
Class A Invested Amount on such Distribution Date.
(b) The amount of monthly principal ("Class B Monthly Principal")
distributable from the Collection Account with respect to the Class B
Certificates on each Distribution Date, beginning with the Class B Principal
Commencement Date, shall be equal to the least of (x) the Available Investor
Principal Collections on deposit in the Collection Account with respect to such
Distribution Date (minus the portion of such Available Investor Principal
Collections applied to Class A Monthly Principal on such Distribution Date), (y)
for each Distribution Date with respect to the Class B Accumulation Period on or
prior to the Class B Expected Final Distribution Date, the Controlled Deposit
Amount for such Distribution Date and (z) the Class B Invested Amount on such
Distribution Date.
(c) The amount, if any, of monthly principal ("Class C Monthly Principal")
distributable with respect to the Class C Invested Amount on each Distribution
Date shall equal the following amounts:
(i) on any Distribution Date prior to the Distribution Date on
which the Class B Invested Amount is paid in full, shall be an amount
equal to the lesser of (A) Available Investor Principal Collections not
applied to Class A Monthly Principal or Class B Monthly Principal on such
Distribution Date and (B) the positive excess, if any, of the Class C
Invested Amount over the Required Class C Invested Amount for such
Distribution Date (calculated after giving effect to all distributions on
such Distribution Date but before giving effect to the payment of Class C
Monthly Principal on such Distribution Date); and
(ii) for each Distribution Date beginning on the Distribution
Date on which the Class B Invested Amount is paid in full, shall be an
amount equal to the Available Investor Principal Collections with respect
to such Distribution Date (minus the portion of such Available Investor
Principal Collections applied to Class A Monthly Principal and Class B
Monthly Principal on such Distribution Date);
22
provided, however, with respect to any Distribution Date, Class C Monthly
Principal shall not exceed the Class C Invested Amount.
Section 4.4. Required Amount.
(a) With respect to each Distribution Date, on the related Determination
Date, the Servicer shall determine the amount (the "Class A Required Amount"),
if any, by which (a) the sum of (i) Class A Monthly Interest for such
Distribution Date, (ii) any Class A Monthly Interest previously due but not paid
to the Class A Certificateholders on a prior Distribution Date, (iii) any Class
A Additional Interest for such Distribution Date and any Class A Additional
Interest previously due but not paid to the Class A Certificateholders on a
prior Distribution Date, (iv) the Class A Servicing Fee for such Distribution
Date, (v) any Class A Servicing Fee previously due but not paid to the Servicer
and (vi) the Class A Investor Default Amount, if any, for such Distribution Date
exceeds (b) the Class A Available Funds. In the event that the Class A Required
Amount for such Distribution Date is greater than zero, the Servicer shall give
written notice to the Trustee of such positive Class A Required Amount on the
date of computation and all or a portion of the Excess Finance Charge
Collections allocable to Series [__________] with respect to the related Monthly
Period in an amount equal to the Class A Required Amount for such Distribution
Date shall be distributed from the Collection Account on such Distribution Date
pursuant to subsection 4.7(a). In the event that the Class A Required Amount
for such Distribution Date exceeds the amount of Excess Finance Charge
Collections allocable to Series [__________] with respect to the related Monthly
Period, all or a portion of the Reallocated Principal Collections with respect
to such Monthly Period in an amount equal to such excess shall be distributed
from the Collection Account on such Distribution Date pursuant to subsection
4.8(a).
(b) With respect to each Distribution Date on the related Determination
Date, the Servicer shall determine the amount (the "Class B Required Amount")
equal to the sum of (I) the amount, if any, by which (a) the sum of (i) Class B
Monthly Interest for such Distribution Date, (ii) any Class B Monthly Interest
previously due but not paid to the Class B Certificateholders on a prior
Distribution Date, (iii) any Class B Additional Interest for such Distribution
Date and any Class B Additional Interest previously due but not paid to the
Class B Certificateholders on a prior Distribution Date, (iv) the Class B
Servicing Fee for such Distribution Date and (v) any Class B Servicing Fee
previously due but not paid to the Servicer exceeds (b) the Class B Available
Funds plus (II) the Class B Investor Default Amount for such Distribution Date.
In the event that the Class B Required Amount for such Distribution Date is
greater than zero, the Servicer shall give written notice to the Trustee of such
positive Class B Required Amount on the date of computation and all or a portion
of Excess Finance Charge Collections allocable to Series [__________] (other
than Excess Finance Charge Collections applied pursuant to subsections 4.7(a)
and (b) with respect to such Distribution Date) with respect to the related
Monthly Period shall be applied to fund the Class B Required Amount. In the
event that the Class B Required Amount for such Distribution Date exceeds the
amount of Excess Finance Charge Collections allocable to Series [__________]
with respect to such Monthly Period and available to fund the Class B Required
Amount as provided in the preceding sentence, all or a portion of the
Reallocated Principal Collections allocable to the Class C Invested Amount
23
available therefor with respect to such Monthly Period in an amount equal to
such excess shall be distributed from the Collection Account on such
Distribution Date pursuant to subsection 4.8(b).
(c) With respect to each Distribution Date, on the related Determination
Date, the Servicer shall determine the amount (the "Class C Required Amount"),
if any, equal to the amount by which the sum of (x) the current and overdue
Class C Servicing Fee for such Distribution Date, plus (y) the sum of (i) Class
C Monthly Interest for such Distribution Date and (ii) any Class C Monthly
Interest previously due but not paid to the Class C Interest Holders on a prior
Distribution Date, plus (z) the Class C Investor Default Amount, if any, for
such Distribution Date exceeds the amount of Class C Available Funds and Excess
Finance Charge Collections available to pay such amounts pursuant to subsection
4.5(c)(i) and subsections 4.7(f), (g) and (h). In the event that the Class C
Required Amount for such Distribution Date is greater than zero, the Servicer
shall give written notice to the Trustee of such positive Class C Required
Amount on the date of computation.
Section 4.5. Application of Class A Available Funds, Class B Available
Funds, Class C Available Funds and Available Investor Principal Collections.
The Servicer shall apply or shall cause the Trustee to apply, on each
Distribution Date, Class A Available Funds, Class B Available Funds, Class C
Available Funds and Available Investor Principal Collections for the Monthly
Period with respect to such Distribution Date to make the following
distributions:
(a) On each Distribution Date, an amount equal to the Class A Available
Funds with respect to such Distribution Date will be distributed 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 the Class A Certificateholders on a
prior Distribution Date, plus the amount of any Class A Additional
Interest for such Distribution Date and any Class A Additional Interest
previously due but not distributed to the Class A Certificateholders on
a prior Distribution Date, shall be distributed to the Paying Agent for
payment to the Class A Certificateholders;
(ii) an amount equal to the Class A Servicing Fee for such
Distribution Date, plus the amount of any Class A Servicing Fee
previously due but not distributed to the Servicer on a prior
Distribution Date, shall be distributed to the Servicer;
(iii) an amount equal to the Class A Investor Default Amount for
such Distribution Date shall be treated as a portion of Available
Investor Principal Collections for such Distribution Date; and
(iv) the balance, if any, shall constitute Excess Spread and shall
be allocated and distributed as set forth in Section 4.7.
(b) On each Distribution Date, an amount equal to the Class B Available
Funds with respect to such Distribution Date will be distributed in the
following priority:
24
(i) 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 the Class B Certificateholders on a
prior Distribution Date, plus the amount of any Class B Additional Interest
for such Distribution Date and any Class B Additional Interest previously
due but not distributed to the Class B Certificateholders on a prior
Distribution Date, shall be distributed to the Paying Agent for payment to
the Class B Certificateholders;
(ii) an amount equal to the Class B Servicing Fee for such
Distribution Date, plus the amount of any Class B Servicing Fee previously
due but not distributed to the Servicer on a prior Distribution Date, shall
be distributed to the Servicer; and
(iii) the balance, if any, shall constitute Excess Spread and
shall be allocated and distributed as set forth in Section 4.7.
(c) On each Distribution Date, an amount equal to the Class C Available
Funds with respect to such Distribution Date will be distributed in the
following priority:
(i) if The Travelers Bank or the Trustee is no longer the
Servicer, an amount equal to the Class C Servicing Fee for such
Distribution Date, plus the amount of any Class C Servicing Fee previously
due but not distributed to the Servicer on a prior Distribution Date, shall
be distributed to the Servicer; and
(ii) the balance, if any, shall constitute Excess Spread and
shall be allocated and distributed as set forth in Section 4.7.
(d) On each Distribution Date with respect to the Revolving Period, an
amount equal to the Available Investor Principal Collections for the related
Monthly Period shall be distributed in the following order of priority:
(i) an amount equal to Class C Monthly Principal for such
Distribution Date, up to the Class C Invested Amount on such Distribution
Date, shall be distributed to the Class C Interest Holder; and
(ii) the balance, if any, shall be treated as a portion of Shared
Principal Collections and applied in accordance with Section 4.04 of the
Agreement.
(e) On each Distribution Date with respect to the Controlled
Accumulation Period or the Rapid Amortization Period, an amount equal to the
Available Investor Principal Collections for the related Monthly Period shall
be distributed in the following priority:
(i) an amount equal to Class A Monthly Principal for such
Distribution Date, up to the Class A Invested Amount, on such Distribution
Date, shall be deposited in the Principal Funding Account for payment to
the Class A Certificateholders by the Paying Agent on the earlier to occur
of the Class A Expected Final Distribution Date or the first Special
Payment Date;
25
(ii) for each Distribution Date beginning on the Class B
Principal Commencement Date, an amount equal to Class B Monthly Principal
for such Distribution Date, up to the Class B Invested Amount on such
Distribution Date, shall be distributed to the Paying Agent for payment to
the Class B Certificateholders;
(iii) an amount equal to Class C Monthly Principal for such
Distribution Date, up to the Class C Invested Amount on such Distribution
Date, shall be distributed to the Class C Interest Holder; and
(iv) for each Distribution Date, after giving effect to
paragraphs (i), (ii) and (iii) above, an amount equal to the balance, if
any, of such Available Investor Principal Collections then on deposit in
the Collection Account shall be treated as Shared Principal Collections and
applied in accordance with Section 4.04 of the Agreement.
Section 4.6. Default Amounts; Investor Charge-Offs.
(a) On each Determination Date commencing with the Determination Date
relating to the _________ 199____ Distribution Date, the Servicer shall
calculate the Class A Investor Default Amount, if any, for the related
Distribution Date. If, on any Distribution Date, the Class A Required Amount
for the related Monthly Period exceeds the sum of (x) the amount of
Reallocated Principal Collections with respect to such Monthly Period and (y)
the amount of Excess Finance Charge Collections allocable to Series
[__________] with respect to such Distribution Date, the Class C Invested
Amount shall be reduced by the amount of such excess, but not by more than
the excess of the Class A Investor Default Amount for such Distribution Date
over the amount of Reallocated Principal Collections and Excess Finance
Charge Collections. In the event that such reduction would cause the Class C
Invested Amount to be a negative number, the Class C Invested Amount shall be
reduced to zero and the Class B Invested Amount shall be reduced by the
amount by which the Class C Invested Amount would have been reduced below
zero, but not by more than the excess, if any, of the Class A Investor
Default Amount for such Distribution Date over the amount of such reduction,
if any, of the Class C Invested Amount with respect to such Distribution Date
and the amount of Reallocated Principal Collections and Excess Finance Charge
Collections used to fund the Class A Investor Default Amount for such
Distribution Date. In the event that such reduction would cause the Class B
Invested Amount to be a negative number, the Class B Invested Amount shall be
reduced to zero, and the Class A Invested Amount shall be reduced by the
amount by which the Class B Invested Amount would have been reduced below
zero, but not by more than the excess, if any, of the Class A Investor
Default Amount for such Distribution Date over the aggregate amount of the
reductions, if any, of the Class C Invested Amount and the Class B Invested
Amount for such Distribution Date and the amount of Reallocated Principal
Collections and Excess Finance Charge Collections used to fund the Class A
Investor Default Amount for such Distribution Date (a "Class A Investor
Charge-Off"). Class A Investor Charge-Offs shall thereafter be reimbursed and
the Class A Invested Amount increased (but not by an amount in excess of the
aggregate unreimbursed Class A Investor Charge-Offs) on any Distribution Date
by the amount of Excess Finance Charge Collections allocated and available
for that purpose pursuant to subsection 4.7(b).
26
(b) On each Determination Date, the Servicer shall calculate the Class B
Required Amount, if any, for the related Distribution Date. If, on any
Distribution Date, the Class B Required Amount for such Distribution Date
exceeds the sum of (x) the amount of Excess Finance Charge Collections
allocated to Series [__________] with respect to the related Monthly Period
which are not used to fund the Class A Required Amount and Class A Investor
Charge-Offs on the related Distribution Date and (y) the amount of
Reallocated Principal Collections allocable to the Class C Invested Amount
which are available to fund the Class B Required Amount on such Distribution
Date pursuant to subsection 4.8(b), then the Class C Invested Amount shall be
reduced by the amount of such excess, but not by more than the excess of the
Class B Investor Default Amount for such Distribution Date over the amount of
Reallocated Principal Collections and Excess Finance Charge Collections used
to fund the Class B Investor Default Amount for such Distribution Date. In
the event that such reduction would cause the Class C Invested Amount to be a
negative number, the Class C Invested Amount shall be reduced to zero, and
the Class B Invested Amount shall be reduced by the amount by which the Class
C Invested Amount would have been reduced below zero, but not by more than
the excess, if any, of the Class B Investor Default Amount for such
Distribution Date over the amount of such reduction, if any, of the Class C
Invested Amount with respect to such Distribution Date and the amount of
Reallocated Principal Collections and Excess Finance Charge Collections used
to fund the Class B Investor Default Amount for such Distribution Date (a
"Class B Investor Charge-Off"). Class B Investor Charge-Offs shall thereafter
be reimbursed and the Class B Invested Amount increased (but not by an amount
in excess of the aggregate unreimbursed Class B Investor Charge-Offs) on any
Distribution Date by the amount of Excess Finance Charge Collections
allocated and available for that purpose pursuant to subsection 4.7(e).
(c) If, on any Distribution Date, Reallocated Principal Collections for
such Distribution Date are applied pursuant to subsection 4.8(a) or (b), the
Class C Invested Amount shall be reduced by the amount of such Reallocated
Principal Collections. In the event that such reduction would cause the
Class C Invested Amount to be a negative number, the Class C Invested Amount
shall be reduced to zero, and the Class B Invested Amount shall be reduced by
the amount by which the Class C Invested Amount would have been reduced below
zero.
(d) If, on any Distribution Date, the Class C Investor Default Amount
exceeds the amount of Excess Finance Charge Collections available to fund the
Class C Investor Default Amount pursuant to subsection 4.7(h) on such
Distribution Date, then the Class C Invested Amount shall be reduced by the
amount of such excess.
Section 4.7. Excess Finance Charge Collections. The Servicer shall
apply or shall cause the Trustee to apply, on each Distribution Date, Excess
Finance Charge Collections for such Distribution Date to make the following
distributions in the following priority:
(a) an amount equal to the Class A Required Amount, if any, with respect
to such Distribution Date shall be distributed by the Trustee to fund any
deficiency pursuant to subsections 4.5(a)(i), (ii) and (iii), in that order
of priority;
27
(b) an amount equal to the aggregate amount of Class A Investor
Charge-Offs which have not been previously reimbursed as provided in
subsection 4.6(a) (after giving effect to the allocation on such Distribution
Date of any amount for that purpose pursuant to subsection 4.6(a)) shall be
treated as a portion of Available Investor Principal Collections for such
Distribution Date;
(c) an amount up to the Class B Required Amount, if any, with respect to
such Distribution Date shall be distributed by the Trustee to fund any
deficiency pursuant to subsections 4.5(b)(i) and (ii), in that order of
priority;
(d) an amount equal to the Class B Investor Default Amount for such
Distribution Date shall be treated as a portion of Available Investor
Principal Collections for such Distribution Date;
(e) an amount equal to the aggregate amount by which the Class B
Invested Amount has been reduced pursuant to clauses [(d), (e) and (f)] of
the definition of "Class B Invested Amount" in Section 2.1 of this Supplement
(but not in excess of the aggregate amount of such reductions which have not
been previously reimbursed) shall be treated as a portion of Available
Investor Principal Collections for such Distribution Date;
(f) an amount equal to the Class C Monthly Interest, if any, for such
Distribution Date, plus the amount of any Class C Monthly Interest previously
due but not distributed to the Class C Interest Holder on a prior
Distribution Date distributed to the Class C Interest Holder;
(g) an amount equal to the Class C Servicing Fee for such Distribution
Date (or if The Travelers Bank or the Trustee is no longer the Servicer, the
portion of the Class C Servicing Fee for such Distribution Date not paid
pursuant to subsection 4.5(c)(i)), plus the amount of any Class C Servicing
Fee previously due but not distributed to the Servicer on a prior
Distribution Date, shall be distributed to the Servicer;
(h) an amount equal to the Class C Investor Default Amount for such
Distribution Date shall be treated as a portion of Available Investor
Principal Collections with respect to such Distribution Date;
(i) an amount equal to the aggregate amount by which the Class C
Invested Amount has been reduced pursuant to clause [(c)] of the definition
of "Class C Invested Amount" (but not in excess of the aggregate amount of
such reductions which have not been previously reimbursed) shall be treated
as a portion of Available Investor Principal Collections with respect to such
Distribution Date;
(j) an amount up to the excess, if any, of the Required Reserve Account
Amount over the amount on deposit therein, shall be deposited into the
Reserve Account;
(k) the balance, if any, shall constitute a portion of "Excess Finance
Charges" available for allocation to other Series in Group [One] or to the
Holders of the Transferor Certificates for such Distribution Date as
described in Section 4.04 of the Agreement.
28
Section 4.8. Reallocated Principal Collections. The Servicer shall
apply or shall cause the Trustee to apply on each Distribution Date,
Reallocated Principal Collections (applying all such Collections with respect
to the Class C Invested Amount prior to applying any such Collections with
respect to the Class B Invested Amount and applying no such Collections with
respect to the Class B Invested Amount pursuant to clause (b) below) with
respect to such Distribution Date, to make the following distributions in the
following priority:
(a) an amount equal to the excess, if any, of (i) the Class A Required
Amount, if any, with respect to such Distribution Date over (ii) the amount
of Excess Finance Charge Collections allocated to Series [__________] with
respect to the related Monthly Period shall be distributed by the Trustee to
fund any deficiency pursuant to subsections 4.5(a)(i), (ii) and (iii), in
that order of priority;
(b) an amount equal to the excess, if any, of (i) the Class B Required
Amount, if any, with respect to such Distribution Date over (ii) the amount
of Excess Finance Charge Collections allocated and available to the Class B
Certificates pursuant to subsections 4.7(c) and (d) on such Distribution Date
shall be distributed by the Trustee to fund any deficiency pursuant to
subsections 4.5(b)(i) and (ii) and subsection 4.7(d), in that order of
priority; and
(c) the balance, if any, of such Reallocated Principal Collections shall
be treated as a portion of Available Investor Principal Collections.
Section 4.9. Excess Finance Charges [and Excess Transferor Finance Charge
Collections].
(a) Subject to subsection 4.04(b) of the Agreement, Excess Finance
Charges with respect to the Series in Group [One] for any Distribution Date
will be allocated to Series [__________] in an amount equal to the product of
(x) the aggregate amount of Excess Finance Charges with respect to all the
Series in Group [One] for such Distribution Date and (y) a fraction, the
numerator of which is the Finance Charge Shortfall for Series [__________]
for such Distribution Date and the denominator of which is the aggregate
amount of Finance Charge Shortfalls (as defined in the related Supplements)
for all the Series in Group [One] for such Distribution Date. The "Finance
Charge Shortfall" for Series [__________] for any Distribution Date shall be
equal to the excess, if any, of (a) the full amount required to be paid,
without duplication, pursuant to subsections 4.5(a), 4.5(b) and 4.5(c) and
4.7 (except for subsection 4.7(n)) on such Distribution Date over (b) the sum
of Class A Available Funds, Class B Available Funds and Class C Available
Funds with respect to the related Monthly Period.
[(b) Subject to subsection 4.04(c) of the Agreement, Excess Transferor
Finance Charge Collections for any Distribution Date will be allocated to
Series [__________] in an amount equal to the product of (x) the Excess
Transferor Finance Charge Collections for such Distribution Date and (y) a
fraction, the numerator of which is the Finance Charge Shortfall for Series
[__________] for such Distribution Date and the denominator of which is the
aggregate amount of Finance Charge Shortfalls (as defined in the related
Supplements) for all Series entitled to receive Excess Transferor Finance
Charge Collections for such Distribution Date, in
29
each case after applying Excess Finance Charges, if any, to each such Series
(including Series [__________]).]
Section 4.10. Shared Principal Collections and Shared Transferor
Principal Collections.
(a) Subject to subsection 4.04(a) of the Agreement, Shared Principal
Collections for any Distribution Date will be allocated to Series [__________]
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 [__________] for such Distribution Date and the
denominator of which is the aggregate amount of Principal Shortfalls for all
the Series that are Principal Sharing Series for such Distribution Date. The
"Principal Shortfall" for Series [__________] shall 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 (on or
prior to the Class B Expected Final Distribution Date), the excess, if any,
of the Controlled Deposit Amount with respect to such Distribution Date over
the amount of Available Investor Principal Collections for such Distribution
Date (excluding any portion thereof attributable to Shared Principal
Collections [or Shared Transferor Principal Collections]) and (c) for each
Distribution Date with respect to the Rapid Amortization Period or the
Controlled Accumulation Period after the Class B Expected Final Distribution
Date, the excess, if any, of the Invested Amount over the amount of Available
Investor Principal Collections for such Distribution Date (excluding any
portion thereof attributable to Shared Principal Collections
[or Shared Transferor Principal Collections]).
[(b) Subject to subsection 4.04(d) of the Agreement, Shared Transferor
Principal Collections for any Distribution Date will be allocated to Series
[__________] in an amount equal to the product of (x) Shared Transferor
Principal Collections and (y) a fraction, the numerator of which is the
Principal Shortfall for Series [__________] and the denominator of which is
the aggregate amount of Principal Shortfalls (as defined in the related
Supplements) for all Series entitled to receive Shared Transferor Principal
Collections for such Distribution Date, in each case after applying Shared
Principal Collections, if any, to each such Series (including Series
[__________]).]
[Section 4.11. Determination of [LIBOR].
(a) On each [LIBOR] Determination Date, the Trustee shall determine
[LIBOR] based on the rate for deposits in United States dollars for a period
of the Designated Maturity which appears on Telerate Page 3750 as of
[11:00 A.M. (London Time)] on such date.
(b) If such rate does not appear on Telerate Page 3750, the Trustee will
determine [LIBOR] on the basis of quotations of the offered rates for
deposits in United States dollars provided by the Reference Banks at
approximately [11:00 A.M. (London time)] on such [LIBOR] Determination Date
to prime banks in the [London interbank market] for a period of the
Designated Maturity. If at least two such quotations are provided, [LIBOR]
will be the arithmetic mean of such quotations.
30
(c) If, on the [LIBOR] Determination Date, such rate does not appear on
Telerate Page 3750 and only one or none of the Reference Banks provides such
offered quotations, [LIBOR] will be the rate per annum that the Trustee
determines to be the arithmetic mean of the offered quotations that three
major banks in the City of New York selected by the Servicer are quoting 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 period of the
Designated Maturity.
(d) The Class A Certificate Rate or Class B Certificate Rate applicable
to the then-current and the immediately preceding Interest Periods may be
obtained by any Series [__________] Certificateholder by telephoning the
Trustee at its Corporate Trust Office at (____) ____-____.]
Section 4.12. Principal Funding Account.
(a) (i) The Servicer, for the benefit of the Series
[__________] Certificateholders, shall establish and maintain in the
name of the Trustee, on behalf of the Trust, an Eligible Deposit
Account (the "Principal Funding Account"), bearing a designation
clearly indicating that the funds deposited therein are held for the
benefit of the Series [__________] Certificateholders. The Principal
Funding Account shall initially be established with The Bank of New
York.
(ii) At the direction of the Servicer, funds on deposit in the
Principal Funding Account shall be invested by the Trustee in Eligible
Investments selected by the Servicer. All such Eligible Investments shall
be held by the Trustee for the benefit of the Series [__________]
Certificateholders; provided that on each Distribution Date all interest
and other investment income (net of losses and investment expenses)
("Principal Funding Investment Proceeds") on funds on deposit
therein shall be applied as set forth in paragraph (iii) below. Funds on
deposit in the Principal Funding Account shall be invested in Eligible
Investments that will mature so that such funds will be available at the
close of business on the Transfer Date preceding the following Distribution
Date. No Eligible Investment shall be disposed of prior to its maturity;
provided, however, that the Trustee may sell, liquidate or dispose of an
Eligible Investment before its maturity, if so directed in writing by the
Servicer, the Servicer having reasonably determined that the interest of
the Series [__________] Certificateholders may be adversely affected if such
Eligible Investment is held to its maturity. Unless the Servicer directs
otherwise, funds deposited in the Principal Funding Account on a Transfer
Date (which immediately precedes a Distribution Date) upon the maturity of
any Eligible Investments are not required to be invested overnight.
(iii) On each Distribution Date, the Servicer shall direct the
Trustee to withdraw from the Principal Funding Account and deposit into the
Collection Account all Principal Funding Investment Proceeds then on
deposit in the Principal Funding Account, and such Principal Funding
Investment Proceeds shall be treated as a portion of Class A Available
Funds for such Distribution Date.
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(iv) Reinvested interest and other investment income on funds
deposited in the Principal Funding Account shall not be considered to be
principal amounts on deposit therein for purposes of this Supplement.
(b) (i) The Trustee shall possess all right, title and interest
in all funds on deposit from time to time in the Principal Funding Account
and in all proceeds thereof. The Principal Funding Account shall be under
the sole dominion and control of the Trustee for the benefit of the
Series [__________] Certificateholders. If, at any time, the Principal
Funding Account ceases to be an Eligible Deposit Account, the Trustee shall
within 10 Business Days (or such longer period, not to exceed 30 calendar
days, as to which each Rating Agency may consent) establish a new Principal
Funding Account meeting the conditions specified in paragraph (a) (i) above
as an Eligible Deposit Account and shall transfer any cash and/or any
investments to such new Principal Funding Account.
(ii) Pursuant to the authority granted to the Servicer in
subsection 3.01(b) of the Agreement, the Servicer shall have the power,
revocable by the Trustee, to make withdrawals and payments or to instruct
the Trustee to make withdrawals and payments from the Principal Funding
Account for the purposes of carrying out the Servicer's or Trustee's duties
hereunder. Pursuant to the authority granted to the Paying Agent in Section
5.01 of this Supplement and Section 6.07 of the Agreement, the Paying Agent
shall have the power, revocable by the Trustee, to withdraw funds from the
Principal Funding Account for the purpose of making distributions to the
Series [__________] Certificateholders.
Section 4.13. Class A Accumulation Period. The Class A Accumulation
Period is scheduled to commence on the Controlled Accumulation Date;
provided, however, that if the Class A Accumulation Period Length on any
Determination Date (determined as described below) is less than twelve
months, upon notice to the Trustee, the Transferor and each Rating Agency,
the Servicer, at its option, may elect to modify the date on which the Class
A Accumulation Period actually commences to the first day of the month that
is a number of months prior to the month in which the Class A Expected Final
Distribution Date occurs at least equal to the Class A Accumulation Period
Length (so that, as a result, the number of Monthly Periods in the Class A
Accumulation Period will at least equal the Class A Accumulation Period
Length); provided, however, that (i) the length of the Class A Accumulation
Period will not be less than one month; and (ii) notwithstanding any other
provision of this Supplement to the contrary, no election to postpone the
commencement of the Class A Accumulation Period shall be made after a Pay Out
Event (as defined in the related Supplement) shall have occurred and is
continuing with respect to any other Series. On each Determination Date, the
Servicer will determine the "Class A Accumulation Period Length," which will
mean a number of months such that the amount available for distribution of
principal on the Class A Certificates on the Class A Expected Final
Distribution Date will equal or exceed the Class A Investor Amount, assuming
for this purpose that (1) the payment rate with respect to Collections of
Principal Receivables remains constant at the lowest level of such payment
rate during the twelve preceding Monthly Periods (or such lower payment rate
as the Servicer may select), (2) the total amount of Principal Receivables in
the Trust (and the principal amount on deposit in the Excess
32
Funding Account, if any) and the Discount Percentage remains constant at the
level on such date of determination, (3) no Pay Out Event with respect to any
Series will subsequently occur and (4) no additional Series (other than any
Series being issued on such date of determination) will be subsequently
issued. Any notice by the Servicer electing to modify the commencement of
the Class A Accumulation Period pursuant to this Section 4.13 shall specify
(i) the Class A Accumulation Period Length, (ii) the commencement date of the
Class A Accumulation Period and (iii) the Controlled Accumulation Amount with
respect to each Monthly Period during the Class A Accumulation Period.
Section 4.14. Reserve Account.
(a) The Servicer shall establish and maintain, in the name of the Trustee,
on behalf of the Trust, for the benefit of the Series [__________] Holders, an
Eligible Deposit Account (the "Reserve Account") bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Series [__________] Holders. The Reserve Account shall initially be established
with The Bank of New York. The Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Reserve Account and in
all proceeds thereof. The Reserve Account shall be under the sole dominion and
control of the Trustee for the benefit of the Series [__________] Holders. If
at any time the Reserve Account ceases to be an Eligible Deposit Account, the
Trustee (or the Servicer on its behalf) shall within 10 Business Days (or such
longer period, not to exceed 30 calendar days, as to which each Rating Agency
may consent) establish a new Reserve Account meeting the conditions specified
above as an Eligible Deposit Account, and shall transfer any cash and/or any
investments to such new Reserve Account. The Trustee, at the direction of the
Servicer, shall (i) make withdrawals from the Reserve Account from time to time
for the purposes set forth in this Supplement, and (ii) on each Distribution
Date (from and after the Reserve Account Funding Date) prior to the termination
of the Reserve Account make a deposit into the Reserve Account in the amount
specified in, and otherwise in accordance with, subsection 4.7(j).
(b) Funds on deposit in the Reserve Account shall be invested at the
written direction of the Servicer by the Trustee in Eligible Investments.
Funds on deposit in the Reserve Account on any Transfer Date, after giving
effect to any withdrawals from the Reserve Account on such Transfer Date,
shall be invested in such investments that will mature so that such funds
will be available for withdrawal on or prior to the immediately succeeding
Transfer Date. The Trustee shall maintain for the benefit of the Series
[__________]Holders possession of the negotiable instruments or securities,
if any, evidencing such Eligible Investments. No Eligible Investment shall
be disposed of prior to its maturity; provided, however, that the Trustee may
sell, liquidate or dispose of an Eligible Investment before its maturity, if
so directed by the Servicer in writing, the Servicer having reasonably
determined that the interest of the Series [__________] Holders may be
adversely affected if such Eligible Investment is held to its maturity. 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 amount on deposit in the Reserve Account is less than
the Required Reserve Account Amount) and the balance, if any, shall be
deposited in the Collection Account and treated as Collections of Finance
Charge Receivables allocable to Series [__________]. For purposes of
determining the availability of funds or the balance in the
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Reserve Account for any reason under this 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 the Determination Date preceding each Distribution Date with
respect to the Controlled Accumulation Period (prior to the Class B Expected
Final Distribution Date) and the first Special Payment Date, the Servicer
shall calculate the "Reserve Draw Amount" which shall be equal to the excess,
if any, of the Covered Amount with respect to such Distribution Date or
Special Payment Date over the Principal Funding Investment Proceeds with
respect to such Distribution Date or Special Payment Date; provided, that
such amount will be reduced to the extent that funds otherwise would be
available for deposit in the Reserve Account under subsection 4.7(j) with
respect to such Distribution Date.
(d) In the event that for any Distribution Date the Reserve Draw Amount
is greater than zero, the Reserve Draw Amount, up to the amount on deposit in
the Reserve Account, shall be withdrawn from the Reserve Account on the
related Transfer Date by the Trustee (acting in accordance with the
instructions of the Servicer), deposited into the Collection Account and
included in Class A Available Funds for such Distribution Date.
(e) In the event that 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
Trustee, acting in accordance with the instructions of the Servicer, shall
withdraw from the Reserve Account, and pay to the Holders of the Transferor
Certificates or their designee an amount equal to such Reserve Account
Surplus.
(f) Upon the earliest to occur of (i) the termination of the Trust
pursuant to Article XII of the Agreement, (ii) the day on which the Class A
Investor Amount is paid in full to the Class A Certificateholders, (iii) if
the Controlled Accumulation Period has not commenced, the occurrence of a Pay
Out Event with respect to Series [__________] and (iv) if the Controlled
Accumulation Period has commenced, the earlier of the first Special Payment
Date and the Class A Expected Final Distribution Date, the Trustee, acting in
accordance with the written instructions of the Servicer, after the prior
payment of all amounts owing to the Series [__________] Certificateholders
which are payable from the Reserve Account as provided herein, shall withdraw
from the Reserve Account and pay to the Holders of the Transferor
Certificates or their designee all amounts, if any, on deposit in the Reserve
Account and the Reserve Account shall be deemed to have terminated for
purposes of this Supplement.
[Section 4.15. Pre-Funding Account.
(a) Establishment of the Pre-Funding Account. The Servicer hereby
directs the Trustee, for the benefit of the Series [__________] Holders, to
establish and maintain or cause to be established and maintained in the name
of the Trustee, on behalf of the Series [__________] Holders, an Eligible
Deposit Account (the "Pre-Funding Account"), bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Series [__________] Holders. The Transferor does hereby transfer, assign,
set over and otherwise convey to the Trustee for the benefit of the Series
[__________]Holders, without recourse, all of its right, title
34
and interest in, to and under the Pre-Funding Account, any Eligible
Investments on deposit therein and any proceeds of the foregoing. The
Pre-Funding Account shall be under the sole dominion and control of the
Trustee for the benefit of the Series [__________]Holders. If, at any time,
the Pre-Funding Account ceases to be an Eligible Deposit Account, the
Servicer shall direct the Trustee to establish within ten Business Days a new
Pre-Funding Account meeting the conditions specified above, transfer any cash
or any investments from the old Pre-Funding Account to such new Pre-Funding
Account and from the date such new Pre-Funding Account is established, it
shall be the "Pre-Funding Account." In addition, after five days' notice to
the Trustee, the Servicer may direct the Trustee to establish a new
Pre-Funding Account meeting the conditions specified above, transfer any cash
or investments from the old Pre-Funding Account to such new Pre-Funding
Account and from the date such new Pre-Funding Account is established, it
shall be the "Pre-Funding Account." The Trustee, at the direction of the
Servicer, shall make withdrawals and payments from the Pre-Funding Account
from time to time for the purposes set forth in this Supplement.
(b) Administration of Pre-Funding Account. The Trustee shall on the
Closing Date deposit into the Pre-Funding Account the Initial Pre-Funded
Amount from the proceeds of the sale of the Series [__________] Certificates
and the Class C Interests. On the Business Day preceding each Transfer Date,
the Trustee, acting in accordance with written instructions from the
Servicer, shall withdraw from the Pre-Funding Account and deposit into the
Collection Account all interest and other investment income on the Pre-Funded
Amount with respect to the prior Monthly Period. Such investment income shall
be deemed to be Collections of Finance Charge Receivables allocated to Series
[__________]. Interest (including reinvested interest) and other investment
income on funds on deposit in the Pre-Funding Account shall not be considered
part of the Pre-Funded Amount for purposes of this Supplement.
(c) Investment of Funds in Pre-Funding Account. Funds on deposit in the
Pre-Funding Account shall be invested in Eligible Investments by the Trustee
(or, at the direction of the Trustee, by the Servicer on behalf of the
Trustee) selected at the written direction of the Servicer. Funds on deposit
in the Pre-Funding Account on the Closing Date and thereafter shall be
invested in Eligible Investments that will mature so that such funds will be
available for withdrawal on the Business Day next succeeding the next
increase in the Invested Amount pursuant to Section 4.16 or, if earlier, on
the next succeeding Transfer Date.
(d) Principal Payments from Pre-Funding Account. In the event that the
Pre-Funded Amount exceeds zero at the end of the Funding Period, on the first
Distribution Date on or after the last day of the Funding Period the Servicer
shall apply or shall cause the Trustee to apply the Pre-Funded Amount to the
payment by the Paying Agent of principal on the Class A Certificates, the
Class B Certificates and the Class C Interests on a pro rata basis based on
the Class A Invested Amount, the Class B Invested Amount and the Class C
Invested Amount.]
[Section 4.16. Increases in Invested Amount. On the last day of each
Monthly Period during the Funding Period, commencing ___________ __, 199____,
the Invested Amount shall increase to the extent that the Transferor Amount on
such day exceeds the product of (A) the sum of____% and the Required Transferor
Percentage on such date and (B) the sum of (i) the product of the aggregate
amount of Principal Receivables in the Trust and one minus the
35
Discount Percentage and (ii) amounts on deposit in the Excess Funding Account
on such day; provided, however, that the Invested Amount shall in no event
exceed $__________ or increase pursuant to this Section 4.16 by an amount in
excess of the Pre-Funded Amount immediately prior to giving effect to such
increase. Such increase in the Invested Amount shall be allocated to the
Class A Certificates, the Class B Certificates and the Class C Interests on a
pro rata basis based on the Class A Invested Amount, the Class B Invested
Amount and the Class C Invested Amount immediately prior to such increase.
Upon any increase in the Invested Amount pursuant to this Section 4.16, the
Servicer shall instruct the Trustee in writing to withdraw from the
Pre-Funding Account and pay to Holders of the Transferor Certificates no
later than the next succeeding Business Day an amount equal to the amount of
such increase in the Invested Amount.]
Section 4.18. Designation of Class C Interest Terms; Sale of Class C
Interests. The Transferor may at any time, without the consent of the
Investor Certificateholders, (i) sell or transfer all or a portion of the
Class C Interest and (ii) in connection with any such sale or transfer, enter
into a supplemental agreement with the Trustee pursuant to which the
Transferor and the Trustee may amend the Class C Interest Rate, set forth the
calculation of the Class C Monthly Interest, provide for the payment of
additional amounts with respect to any Monthly Interest and provide for such
other provisions with respect to the Class C Interests as may be specified in
such supplemental agreement, provided that in each case (A) the Transferor
shall have given notice to the Trustee, the Servicer and the Rating Agencies
of such proposed sale or transfer of the Class C Interest and such
supplemental agreement at least five Business Days prior to the consummation
of such sale or transfer and the execution of such proposed supplemental
agreement; (B) the Rating Agency Condition shall have been satisfied; (C) no
Pay Out Event shall have occurred prior to the consumation of such proposed
sale or transfer of Class C Interests or the execution of such supplemental
agreement; (D) the Transferor shall have delivered an Officer's Certificate,
dated the date of the consummation of such sale or transfer and the
effectiveness of such supplemental agreement, to the effect that, in the
reasonable belief of the Transferor, such action will not, based on the facts
known to such officer at the time of such certification, cause a Pay Out
Event to occur with respect to any Series, and (E) the Transferor will have
delivered a Tax Opinion, dated the date of such certificate with respect to
such action; provided further, (i) as a condition to the sale or transfer of
all or a portion of the Class C Interest the transferee shall be required to
agree not to institute against, or join any other Person in instituting
against, the Trust or the Transferor any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceeding, or other proceeding under
any federal or state bankruptcy or similar law, for one year and one day
after all Investor Certificates are paid in full and (ii) the Class C
Interests may not be sold or transferred, in whole or in part, to The
Travelers Bank or The Travelers Bank USA.
ARTICLE V
Distributions and Reports to Series [__________] Certificateholders
Section 5.1. Distributions.
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(a) On each Distribution Date, the Paying Agent shall distribute to each
Class A Certificateholder of record on the related Record Date (other than as
provided in Section 12.02 of the Agreement) such Class A Certificateholder's
pro rata share of the amounts that are allocated and available on such
Distribution Date to pay interest on the Class A Certificates pursuant to
this Supplement.
(b) On each Distribution Date, commencing with the first to occur of the
Class A Expected Final Payment Date and the first Special Payment Date, the
Paying Agent shall distribute to each Class A Certificateholder of record on
the related Record Date (other than as provided in Section 12.02 of the
Agreement) such Class A Certificateholder's pro rata share of the amounts
that are allocated and available on such date to pay principal of the Class A
Certificates pursuant to this Supplement up to a maximum amount on any such
date equal to the Class A Investor Amount on such date (unless there has been
an optional repurchase of the Certificateholders' Interest pursuant to
Section 10.01 of the Agreement, in which event the foregoing limitation will
not apply).
(c) On each Distribution Date, the Paying Agent shall distribute to each
Class B Certificateholder of record on the related Record Date (other than as
provided in Section 12.02 of the Agreement) such Class B Certificateholder's
pro rata share of the amounts that are allocated and available on such
Distribution Date to pay interest on the Class B Certificates pursuant to
this Supplement.
(d) On each Distribution Date, commencing with the Class B Principal
Commencement Date, the Paying Agent shall distribute to each Class B
Certificateholder of record on the related Record Date (other than as
provided in Section 12.02 of the Agreement) such Class B Certificateholder's
pro rata share of the amounts that are allocated and available on such date
to pay principal of the Class B Certificates pursuant to this Supplement up
to a maximum amount on any such date equal to the Class B Investor Amount on
such date (unless there has been an optional repurchase of the
Certificateholders' Interest pursuant to Section 10.01 of the Agreement, in
which event the foregoing limitation will not apply).
(e) The distributions to be made pursuant to this Section 5.1 are
subject to the provisions of Sections 2.06, 9.02, 10.01 and 12.02 of the
Agreement and Sections 8.1 and 8.2 of this Supplement.
(f) Except as provided in Section 12.02 of the Agreement with respect to
a final distribution in respect of the Class A Certificates or the Class B
Certificates, distributions to Series [__________] Holders hereunder shall be
made by check mailed to each Series [__________] Holder at such Series
[__________] Holder's address appearing in the Certificate Register or the
Book-Entry Register, as applicable, without presentation or surrender of any
Series [__________] Certificate or the making of any notation thereon;
provided, however, that with respect to Series [__________] Certificates
registered in the name of a Clearing Agency, such distributions shall be made
to such Clearing Agency in immediately available funds.
Section 5.2. Certificates and Statements.
37
(a) Not later than each Determination Date, the Servicer shall deliver
to the Trustee, the Paying Agent and each Rating Agency, a certificate
substantially in the form of Exhibit B prepared by the Servicer.
(b) On each Distribution Date, the Paying Agent, on behalf of the
Trustee, shall forward to each Series [__________] Holder a statement
substantially in the form of Exhibit C prepared by the Servicer.
(c) A copy of each statement or certificate provided pursuant to
paragraph (a) or (b) may be obtained by any Series [__________] Holder or any
Certificate Owner thereof by a request in writing to the Servicer.
(d) On or before January 31 of each calendar year, beginning with
calendar year 199____, the Paying Agent, on behalf of the Trustee, shall
furnish or cause to be furnished to each Person who at any time during the
preceding calendar year was a Series [__________] Holder, a statement
prepared by the Servicer containing the information which is required to be
contained in the statement to Series [__________] Holders, as set forth in
paragraph (b) above, aggregated for such calendar year or the applicable
portion thereof during which such Person was a Series [__________] Holder,
together with other information as is required to be provided by an issuer of
indebtedness under the Internal Revenue Code. Such obligation of the Servicer
shall be deemed to have been satisfied to the extent that substantially
comparable information shall be provided by the Paying Agent pursuant to any
requirements of the Internal Revenue Code as from time to time in effect.
ARTICLE VI
Additional Pay Out Events
Section 6.1. Additional Pay Out Events. If any one of the following
events shall occur with respect to Series [__________]:
(a) failure on the part of the Transferor (A) to make any payment or
deposit required by the terms of the Agreement on or before the date
occurring five Business Days after the date such payment or deposit is
required to be made herein or (B) duly to observe or perform in any material
respect any other covenants or agreements of the Transferor set forth in the
Agreement which has a material adverse effect on the Series [__________]
Certificateholders (which determination shall be made, for so long as the
Class C Invested Amount is greater than zero, without reference to whether
any funds are available pursuant to Series Enhancement) and continues
unremedied for a period of 60 days after the date on which written notice of
such failure, requiring the same to be remedied, shall have been given to the
Transferor by the Trustee, or to the Transferor and the Trustee by Series
[__________] Certificateholders aggregating not less than 50% of the sum of
the outstanding principal balance of the Series [__________] Certificates;
(b) any representation or warranty made by the Transferor in the
Agreement or any information contained in a computer file or microfiche list
required to be delivered by the
38
Servicer on behalf of the Transferor pursuant to Section 2.01 or 2.09 of the
Agreement (A) 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 60 days after the date on which written notice of
such failure, requiring the same to be remedied, shall have been given to the
Transferor by the Trustee, or to the Transferor and the Trustee by Series
[__________] Certificateholders aggregating not less than 50% of the sum of
the outstanding principal balance of the Series [__________] Certificates and
(B) as a result of which the interests of the Series [__________]
Certificateholders are materially and adversely affected (which determination
shall be made, for so long as the Class C Invested Amount is greater than
zero, without reference to whether any funds are available pursuant to any
Series Enhancement); provided, however, that a Pay Out Event pursuant to this
subparagraph (b) shall not be deemed to occur hereunder if the Transferor
shall have accepted reassignment of the related Receivable, or all of such
Receivables, if applicable, during such period (or such longer period as the
Trustee may specify) in accordance with the provisions hereof and of the
Agreement;
(c) (1)with respect to the last day of any prior Monthly Period during
which the Transferor Amount is less than the Required Transferor Amount, the
failure of the Transferor to convey on or prior to the Required Designation
Date Receivables in Additional Accounts to the Trust such that the Transferor
Amount shall be at least equal to the Required Transferor Amount as of the
close of business on the applicable Addition Date; or (2) with respect to the
last day of any prior Monthly Period during which the product of the
aggregate amount of Principal Receivables and one minus the Discount
Percentage is less than the Required Principal Balance as of such day, the
failure of the Transferor to convey on or prior to the Required Designation
Date Receivables in Additional Accounts to the Trust such that the product of
the aggregate amount of the Principal Receivables and one minus the Discount
Percentage shall be at least equal to the Required Principal Balance as of
the close of business on the applicable Addition Date;
(d) the Net Portfolio Xxxxx averaged over three consecutive Monthly
Periods is less than the Base Rate averaged over such period;
(e) any Servicer Default shall occur which would have a material adverse
effect on the Series [__________] Certificateholders (which determination
shall be made, for so long as the Class C Invested Amount is greater than
zero, without reference to whether any funds are available pursuant to any
Series Enhancement); or
(f) the Class A Investor Amount shall not be paid in full on the Class A
Expected Final Distribution Date or the Class B Invested Amount shall not be
paid in full on the Class B Expected Final Distribution Date;
then, in the case of any event described in subparagraph (a), (b) or (e),
after the applicable grace period, if any, set forth in such subparagraphs,
either the Trustee or the holders of Series [__________] Certificates
evidencing more than 50% of the aggregate unpaid principal amount of the
Series [__________] Certificates by notice then given in writing to the
Transferor and the Servicer (and to the Trustee if given by the Holders of
the Series [__________] Certificates may declare that a Pay Out Event has
occurred with respect to Series [__________]
39
as of the date of such notice, and, in the case of any event described in
subparagraph (c), (d) or (f) a Pay Out Event shall occur with respect to
Series [__________] without any notice or other action on the part of the
Trustee or Holders of Series [__________] Certificates immediately upon the
occurrence of such event.
ARTICLE VII
Optional Repurchase; Series Termination
Section 7.1. Optional Repurchase. On any day occurring on or after the
date on which the Investor Amount is reduced to [10]% or less of the Initial
Investor Amount, the Transferor shall have the option to purchase the
interest of the Series [__________] Certificateholders (including the Class C
Interests), 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.
Section 7.2. Series Termination.
(a) If, on the ________ ______ Distribution Date, the Investor Amount
(after giving effect to all changes therein on such date) would be greater
than zero, the Servicer, on behalf of the Trustee, shall, within the 40-day
period which begins on such Distribution Date, solicit bids for the sale of
Principal Receivables and the related Finance Charge Receivables (or
interests therein) in an amount equal to the Investor Amount and accrued and
unpaid interest thereon at the close of business on the last day of the
Monthly Period preceding the Series Termination Date (after giving effect to
all distributions required to be made on the Series Termination Date, except
pursuant to this Section 7.2; provided, however that in no event shall such
amount exceed the Series Percentage of Receivables on the Series Termination
Date). Such bids shall require that such sale shall (subject to subsection
7.2(b)) occur on the Series Termination Date. The Transferor shall be
entitled to participate in, and to receive from the Trustee a copy of each
other bid submitted in connection with, such bidding process.
(b) The Servicer, on behalf of the Trustee, shall sell such Receivables
(or interests therein) on the Series Termination Date to the bidder who made
the highest cash purchase offer. The proceeds of any such sale shall be
treated as Collections on the Receivables allocated to Series [__________]
pursuant to the Agreement and this Supplement; provided, however, that the
Servicer shall determine conclusively the amount of such proceeds which are
allocable to Finance Charge Receivables and the amount of such proceeds which
are allocable to Principal Receivables. During the period from the ________
_______ Distribution Date to the Series Termination Date, the Servicer shall
continue to collect payments on the Receivables and allocate and deposit such
collections in accordance with the provisions of the Agreement and the
Supplements.
ARTICLE VIII
Final Distributions
40
Section 8.1. Sale of Receivables or Certificateholders' Interest
Pursuant to Section 2.06 or 10.01 of the Agreement.
(a) Purchase Price. The amount to be paid with respect to Series
[__________] in connection with (i) a reassignment of Receivables to the
Transferor pursuant to Section 2.06 of the Agreement or (ii) a repurchase of
the Certificateholders' Interest pursuant to Section 10.01 of the Agreement
shall equal the Reassignment Amount for the first Distribution Date following
the Monthly Period in which the reassignment obligation arises under the
Agreement.
(b) Distributions Pursuant to Section 7.01 or 7.02 of this Supplement
and Section 10.01 of the Agreement. With respect to the Reassignment Amount
deposited into the Collection Account pursuant to Section 7.1 or 8.1(a)(ii)
or any amounts allocable to Series [__________] deposited into the Collection
Account pursuant to Section 7.2, the Trustee shall, not later than 3:00 p.m.
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
Investor Amount on such Distribution Date will be distributed to the Paying
Agent for payment to the Class A Certificateholders 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 Certificateholders 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
Certificateholders on any prior Distribution Date, will be distributed to the
Paying Agent for payment to the Class A Certificateholders, (ii) (x) the
Class B Invested Amount on such Distribution Date will be distributed to the
Paying Agent for payment to the Class B Certificateholders and (y) an amount
equal to the sum of (A) Class B Monthly Interest for such Distribution Date,
(B) any Class B Monthly Interest previously due but not distributed to the
Class B Certificateholders 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
Certificateholders on any prior Distribution Date, will be distributed to the
Paying Agent for payment to the Class B Certificateholders and (iii) (x) the
Class C Invested Amount on such Distribution Date will be distributed to the
Class C Interest Holder and (y) an amount equal to the sum of (A) Class C
Monthly Interest, if any, for such Distribution Date and (B) any Class C
Monthly Interest previously due but not distributed to the Class C Interest
Holders on a prior Distribution Date shall be distributed to the Class C
Interest Holder.
(c) Distributions Pursuant to Section 2.06 of the Agreement. With
respect to any amounts deposited into the Collection Account pursuant to
subsection 8.1(a)(i), the Trustee shall, not later than 3:00 p.m., New York
City time, on the related Distribution Date, deposit the principal portion of
such amounts that are allocable to the Series [__________] Holders into the
Collection Account.
(d) Notwithstanding anything to the contrary in this Supplement or the
Agreement, all amounts distributed to the Paying Agent pursuant to subsection
8.1(b) for payment to the Series [__________] Certificateholders shall be
deemed distributed in full to the Series [__________] Certificateholders on
the date on which such funds are distributed to the Paying Agent pursuant
41
to this Section and shall be deemed to be a final distribution pursuant to
Section 12.02 of the Agreement.
ARTICLE IX
Certificates
Section 9.1. Book-Entry Certificates. The Class A Certificates and the
Class B Certificates shall be delivered as Book-Entry Certificates. The
Clearing Agency for the Class A Certificates and the Class B Certificates
shall be The Depository Trust Company, and the Class A Certificates and the
Class B Certificates shall be initially registered in the name of Cede & Co.,
its nominee.
Section 9.2. Uncertificated Securities. The Class C Interests shall be
delivered in uncertificated form.
ARTICLE X
Miscellaneous Provisions
Section 10.1. Ratification of Agreement. As supplemented by this
Supplement, the Agreement is in all respects ratified and confirmed and the
Agreement as so supplemented by this Supplement shall be read, taken and
construed as one and the same instrument.
Section 10.2. Counterparts. This 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 10.3. Governing Law. THIS SUPPLEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING THE UCC AS IN
EFFECT IN THE STATE OF NEW YORK, 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.
Section 10.4. Notices. All directions, notices and instructions to the
Trustee shall be in writing (which may be facsimile).
Section 10.5. Amendments. This Supplement may be amended by the
Transferor without the consent of the Servicer, the Trustee or any Investor
Certificateholder if the Transferor provides the Trustee with (i) an Opinion
of Counsel to the effect that such amendment or modification would reduce the
risk that the Trust would be treated as taxable as a publicly traded
partnership pursuant to Code section 7704 and (ii) an Officer's Certificate
that such amendment or modification would not materially and adversely affect
any Investor Certificateholder, provided that no such amendment shall be
deemed effective without (i) the Trustee's consent, if the Trustee's rights,
duties and obligations hereunder are thereby modified
42
and (ii) the Trustee having obtained written assurance that such amendment or
modification will not, by itself, lower the then-current ratings on the
Series [__________] Certificates. The Transferor shall provide the Rating
Agencies with prior written notice of any such amendment or modification.
43
IN WITNESS WHEREOF, the undersigned have caused this Supplement to be
duly executed and delivered by their respective duly authorized officers on
the day and year first above written.
CC CREDIT CARD CORPORATION
Transferor,
By-------------------------------------
Name:
Title:
THE TRAVELERS BANK,
Servicer,
By-------------------------------------
Name:
Title:
THE BANK OF NEW YORK,
Trustee
By-------------------------------------
Name:
Title:
[Signature Page for Series [__________] Supplement]
