EXHIBIT 4.3
FORM OF SERIES SUPPLEMENT
MBNA AMERICA BANK, NATIONAL ASSOCIATION
Seller and Servicer
and
THE BANK OF NEW YORK
Trustee
on behalf of the Series 2001-__ Certificateholders
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SERIES 2001-__ SUPPLEMENT
Dated as of ______ __, 2001
to
POOLING AND SERVICING AGREEMENT
Dated as of August 4, 1994
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MBNA MASTER CREDIT CARD TRUST II
SERIES 2001-__
TABLE OF CONTENTS
Page
SECTION 1. Designation............................................................................................ 1
SECTION 2. Definitions............................................................................................ 1
SECTION 3. Servicing Compensation and Assignment of Interchange................................................... 10
SECTION 4. Delivery of the Certificate............................................................................ 11
SECTION 5. Article IV of the Agreement............................................................................ 12
SECTION 4.04 Rights of Certificateholders.............................................................. 12
SECTION 4.05 Allocations............................................................................... 12
SECTION 4.06 Monthly Payments.......................................................................... 15
SECTION 4.07 Shared Principal Collections.............................................................. 16
SECTION 4.08 Seller's or Servicer's Failure to Make a Deposit or Payment............................... 17
SECTION 4.09 Collections of Finance Charge Receivables Allocable to
Segregated Seller Interest................................................................ 17
SECTION 6. Article V of the Agreement............................................................................. 18
SECTION 5.01. Distributions............................................................................. 18
SECTION 5.02. Monthly Series Certificateholders' Statement....................................................... 18
SECTION 7. Series 2001-__ Pay Out Events.......................................................................... 19
SECTION 8. Sale of Investor Interest Pursuant to Section 2.04(e) or 10.02(a) of the
Agreement.............................................................................................. 20
SECTION 9. Distribution of Proceeds of Sale, Disposition or Liquidation of the
Receivables Pursuant to Section 9.02 of the Agreement.................................................. 20
SECTION 10. Sale of Receivables.................................................................................... 21
SECTION 11. Series 2001-__ Termination............................................................................. 21
SECTION 12. Counterparts........................................................................................... 21
SECTION 13. Governing Law.......................................................................................... 22
SECTION 14. Additional Notices..................................................................................... 22
SECTION 15. Additional Representations and Warranties of the Servicer.............................................. 22
SECTION 16. No Petition............................................................................................ 22
SECTION 17. Certain Tax Related Amendments......................................................................... 22
SECTION 18. Treatment of Noteholders............................................................................... 23
SECTION 19. Transfer of the Series 2001-__ Certificate............................................................. 23
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EXHIBITS
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EXHIBIT A Form of Certificate
EXHIBIT B Form of Monthly Payment Instructions and Notification to the
Trustee
EXHIBIT C Form of Monthly Series 2001-__ Certificateholder's Statement
SCHEDULE 1
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Schedule to the Exhibit C of the Pooling and Servicing Agreement
-ii-
SERIES 2001-__ SUPPLEMENT, dated as of ______ __, 2001 (this "Series
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Supplement"), by and between MBNA AMERICA BANK, NATIONAL ASSOCIATION, a national
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banking association, as Seller and Servicer, and THE BANK OF NEW YORK, as
Trustee under the Pooling and Servicing Agreement dated as of August 4, 1994
between MBNA America Bank, National Association and the Trustee (as amended, the
"Agreement").
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Section 6.09 of the Agreement provides, among other things, that the
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Seller and the Trustee may at any time and from time to time enter into a
supplement to the Agreement for the purpose of authorizing the delivery by the
Trustee to the Seller for the execution and redelivery to the Trustee for
authentication of one or more Series of Certificates.
Pursuant to this Series Supplement, the Seller and the Trust shall
create a new Series consisting of an Investor Certificate and shall specify the
Principal Terms thereof.
SECTION 1. Designation.
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(a) There is hereby created a Series consisting of an Investor
Certificate to be issued pursuant to the Agreement and this Series Supplement
and to be known as the "Series 2001-__ Certificate." Such Investor Certificate
shall be issued in one Class and shall be designated the Asset Backed
Certificate, Series 2001-__ (the "Certificate"). The Certificate shall be issued
as one definitive certificate substantially in the form of Exhibit A hereto.
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(b) Series 2001-__ shall be included in Group One (as defined below).
Series 2001-__ shall not be subordinated to any other Series.
(c) Except as expressly provided herein, (i) the provisions of Article
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VI and Article XII of the Agreement relating to the registration,
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authentication, delivery, presentation, cancellation and surrender of Registered
Certificates and the opinion described in subsection 6.09(b)(d)(i) and clauses
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(a) and (c) of the definition of Tax Opinion in Section 1.01 of the Agreement
shall not be applicable to the Certificate, and (ii) the provisions of Section
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3.07 of the Agreement shall not apply to cause the Certificates to be treated as
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debt for federal, state and local income and franchise tax purposes, but rather
the Seller intends and, together with the Certificateholders, agrees to treat
the Certificate for federal, state and local income and franchise tax purposes
as representing an equity interest in the assets of the Trust.
(d) This Series Supplement is the Series 2001-__ Supplement referred
to in the Trust Agreement of the MBNA Credit Card Master Note Trust, dated as of
_____ __, 2001, among MBNA, as beneficiary, and Wilmington Trust Company, as
owner trustee.
SECTION 2. Definitions.
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In the event that any term or provision contained herein shall
conflict with or be inconsistent with any provision contained in the Agreement,
the terms and provisions of this Series Supplement shall govern. All Article,
Section or subsection references herein shall mean Articles, Sections or
subsections of the Agreement, except as otherwise provided herein. All
capitalized terms not otherwise defined herein are defined in the Agreement.
Each capitalized
term defined herein shall relate only to the Investor Certificate and no other
Series of Certificates issued by the Trust.
"Accumulation Period" with respect to Series 2001-__ shall mean,
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solely for the purposes of the definition of Group One Monthly Principal Payment
as such term is defined in each Supplement relating to Group One, the Revolving
Period.
"Adjusted Outstanding Dollar Principal Amount" shall have the meaning
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specified in the Indenture.
"Aggregate Investor Default Amount" shall mean, with respect to any
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Monthly Period, the sum of the Investor Default Amounts with respect to such
Monthly Period.
"Allocation Reset Date" shall mean, with respect to any Monthly
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Period, any date on which (a) the Investor Interest is increased as a result of
(i) the issuance of a new tranche of Notes, (ii) the accretion of principal on
Discount Notes, (iii) an increase in the outstanding dollar principal amount of
a tranche of Notes (other than an accretion of principal of a Discount Note) or
(iv) a release of funds from a pre-funded amount from a principal funding
account, (b) an Addition Date occurs or (c) a Removal Date occurs on which, if
any Series has been paid in full, Principal Receivables in an aggregate amount
approximately equal to the initial investor interest of such Series are removed
from the Trust; provided, however, that solely with respect to this term,
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"Series" shall mean any series of Investor Certificates (as defined in the
Agreement) and any tranche of Notes.
"Available Funds" shall mean, with respect to any Monthly Period, an
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amount equal to the sum of (i) Collections of Finance Charge Receivables and
amounts with respect to Annual Membership Fees allocated to the Investor
Certificate and deposited in the Finance Charge Account for such Monthly Period
(or to be deposited in the Finance Charge Account on the related Transfer Date
with respect to the preceding Monthly Period pursuant to the third paragraph of
subsection 4.03(a) and Section 2.08 of the Agreement and subsection 3(b) of this
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Series Supplement), plus (ii) Principal Account Investment Proceeds to be
treated as Available Funds pursuant to Section 4.02(e) of the Agreement as
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amended by Section 5(b) of this Supplement, plus (iii) Finance Charge Account
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Investment Proceeds to be treated as Available Funds pursuant to Section 4.02(e)
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of the Agreement as amended by Section 5(b) of this Supplement, minus (iv) if
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the Seller or The Bank of New York is the Servicer, any Servicer Interchange for
the related Monthly Period; provided, however, that solely with respect to
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clause (i) above, Collections of Finance Charge Receivables allocable to an
increase in the Investor Interest as described in clause (i) of the definition
of Allocation Reset Date for each Monthly Period prior to the first Interest
Payment Date (as defined in the Indenture) of the tranche or tranches of Notes
related to such increase, may in the Seller's sole and absolute discretion
designate that such Collections of Finance Charge Receivables be treated as
"Available Funds" for any Monthly Period prior to such first Interest Payment
Date, provided that each such Collection of Finance Charge Receivables is
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included in the calculation of Available Funds for a Monthly Period prior to
such first Interest Payment Date.
"Available Investor Principal Collections" shall mean with respect to
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any Monthly Period, an amount equal to (a) the Investor Principal Collections
for such Monthly
2
Period, plus (b) the amount of Shared Principal Collections with respect to
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Group One that are allocated to Series 2001-__ in accordance with subsection
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4.07(b).
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"Closing Date" shall mean ______ __, 2001.
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"Code" shall mean the Internal Revenue Code of 1986, as amended.
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"Cumulative Series Principal Shortfall" shall mean the sum of the
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Series Principal Shortfalls (as such term is defined in each of the related
Series Supplements) for each Series in Group One.
"Daily Principal Shortfall" shall mean, on any date of determination,
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the excess of the Group One Monthly Principal Payment for the Monthly Period
relating to such date over the month to date amount of Collections processed in
respect of Principal Receivables for such Monthly Period allocable to investor
certificates of all outstanding Series in Group One, not subject to
reallocation, which are on deposit or to be deposited in the Principal Account
on such date.
"Discount Note" shall have the meaning specified in the Indenture.
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"Distribution Date" shall mean ______ __, 2001 and the fifteenth day
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of each calendar month thereafter, or if such fifteenth day is not a Business
Day, the next succeeding Business Day.
"Finance Charge Account Investment Proceeds" shall mean, with respect
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to each Transfer Date, the investment earnings on deposits of Collections of
Finance Charge Receivables for the related Monthly Period in the Finance Charge
Account (net of investment expenses and losses) for the period from and
including the first day of the related Monthly Period to but excluding such
Transfer Date.
"Fitch" shall mean Fitch, Inc., or any successor thereto.
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"Floating Investor Percentage" shall mean, with respect to any Monthly
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Period, the percentage equivalent of a fraction, the numerator of which is the
Investor Interest as of the close of business on the last day of the preceding
Monthly Period (or with respect to the first Monthly Period, the Investor
Interest on the close of business on the Closing Date) and the denominator of
which is the greater of (a) the aggregate amount of Principal Receivables as of
the close of business on the last day of the preceding Monthly Period (or with
respect to the first calendar month in the first Monthly Period, the aggregate
amount of Principal Receivables in the Trust as of the close of business on the
day immediately preceding the Closing Date and with respect to the second
calendar month in the first Monthly Period, the aggregate amount of Principal
Receivables as of the close of business on the last day of the first calendar
month in the first Monthly Period), and (b) the sum of the numerators used to
calculate the Investor Percentages (as such term is defined in the Agreement)
for allocations with respect to Finance Charge Receivables or Default Amounts,
as applicable, for all outstanding Series on such date of determination;
provided, however, that with respect to any Monthly Period in which the Investor
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Interest is increased on an Allocation Reset Date as described in clause (a) of
the definition
3
thereof, the numerator above, on and after the date of such increase, shall be
the sum of the Investor Interest as of the close of business on the last day of
the preceding Monthly Period, the amount of such increase in the Investor
Interest on such Allocation Reset Date and the amount of any other increases in
the Investor Interest on any prior Allocation Reset Date occurring in such
Monthly Period; provided further, however, that with respect to any Monthly
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Period in which an Allocation Reset Date occurs, the denominator determined
pursuant to clause (a) hereof shall be, on and after such date, the aggregate
amount of Principal Receivables in the Trust as of the beginning of the day on
the most recently such occurring Allocation Reset Date (after adjusting for the
aggregate amount of Principal Receivables, if any, added to or removed from the
Trust on such Allocation Reset Date).
"Group One" shall mean Series 2001-__ and each other Series specified
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in the related Supplement to be included in Group One.
"Group One Monthly Principal Payment" shall mean with respect to any
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Monthly Period, for all Series in Group One (including Series 2001-__) which are
in an Amortization Period or Accumulation Period (as such terms are defined in
the related Supplements for all Series in Group One), the sum of (a) the
Controlled Distribution Amount for the related Transfer Date for any Series in
its Controlled Amortization Period (as such terms are defined in the related
Supplements for all Series in Group One), (b) the Controlled Deposit Amount for
the related Transfer Date for any Series (other than this Series 2001-__) in its
Accumulation Period, other than its Rapid Accumulation Period, if applicable (as
such terms are defined in the related Supplements for all Series in Group One),
(c) if Series 2001-__ is in its Accumulation Period, the Targeted Principal
Deposit Amount for such Monthly Period for this Series 2001-__, (d) the Investor
Interest as of the end of the prior Monthly Period taking into effect any
payments to be made on the following Distribution Date for any Series in Group
One in its Principal Amortization Period or Rapid Amortization Period (as such
terms are defined in the related Supplements for all Series in Group One), (e)
the Adjusted Investor Interest as of the end of the prior Monthly Period taking
into effect any payments or deposits to be made on the following Transfer Date
and Distribution Date for any Series in Group One in its Rapid Accumulation
Period (as such terms are defined in the related Supplements for all Series in
Group One), and (f) such other amounts as may be specified in the related
Supplements for all Series in Group One.
"Indenture" shall mean the Indenture, dated as of _____ __, 2001,
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between MBNA Credit Card Master Note Trust, as Issuer, and The Bank of New
York, as indenture trustee, as amended and supplemented from time to time.
"Initial Dollar Principal Amount," with respect to any tranche of
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Notes, shall have the meaning specified in the Indenture.
"Initial Investor Interest" shall mean, when used in this Agreement,
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this Supplement or any other Supplement with respect to Series 2001-__ and with
respect to any Monthly Period, the Initial Dollar Principal Amount of any
tranche of Notes.
"Insolvency Proceeds" shall mean any proceeds arising out of a sale,
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disposition or liquidation of Receivables (or interests therein) pursuant to
Section 9.02(a) of the Agreement.
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4
"Investor Certificateholders" shall mean the Series 2001-__
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Certificateholders.
"Investor Certificate" shall mean the Series 2001-__ Certificate.
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"Investor Default Amount" shall mean, with respect to any Receivable
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in a Defaulted Account, an amount equal to the product of (a) the Default Amount
and (b) the Floating Investor Percentage on the day such Account became a
Defaulted Account.
"Investor Default Target Deposit Amount" shall mean, for any Monthly
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Period, an amount equal to the product of (a) 1.5 and (b) the highest Aggregate
Investor Default Amount for the three immediately preceding Monthly Periods.
"Investor Interest" with respect to Series 2001-__ shall mean, on any
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date of determination, an amount equal to the sum of the Nominal Liquidation
Amounts for each tranche of Notes Outstanding as of such date of determination.
"Investor Percentage" shall mean for any Monthly Period, (a) with
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respect to Finance Charge Receivables and Default Amounts, the Floating Investor
Percentage and (b) with respect to Principal Receivables, the Principal Investor
Percentage.
"Investor Principal Collections" shall mean, with respect to any
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Monthly Period, the sum of (a) the aggregate amount deposited into the Principal
Account for such Monthly Period pursuant to subsections 4.05(a)(ii) or
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4.05(b)(ii), in each case, as applicable to such Monthly Period, and (b) the
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aggregate amount of Unallocated Principal Collections deposited into the
Principal Account pursuant to subsection 4.05(c).
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"Investor Servicing Fee" shall have the meaning specified in
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subsection 3(a) hereof.
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"Legal Maturity Date," with respect to any tranche of Notes, shall
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have the meaning specified in the Indenture.
"Monthly Period" shall have the meaning specified in the Agreement,
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except that the first Monthly Period with respect to the Investor Certificate
shall begin on and include the Closing Date and shall end on and include
__________ __, 2001.
"Monthly Principal Accrual Date" shall have the meaning specified in
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the Indenture.
"Net Servicing Fee" shall have the meaning specified in subsection
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3(a) of this Series Supplement.
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"Net Servicing Fee Rate" shall mean (a) so long as the Seller or The
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Bank of New York is the Servicer, 1.25% per annum and (b) if the Seller or The
Bank of New York is no longer the Servicer, 2.0% per annum.
5
"Nominal Liquidation Amount," with respect to any tranche of Notes,
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shall have the meaning specified in the Indenture.
"Note" or "Notes" shall mean each Note or the Notes (as defined in the
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Indenture) secured by the Collateral Certificate.
"Note Amortization Period" shall mean, with respect to any tranche of
------------------------
Notes, the period commencing on [the first day of the Monthly Period] preceding
a Monthly Principal Accrual Date with respect to such tranche of Notes and
ending on the [last day of the Monthly Period] preceding a Monthly Principal
Accrual Date (as defined in the Indenture) with respect to such tranche of Notes
for which there is not a Monthly Principal Accrual Date occurring in the next
following Monthly Period.
"Outstanding" shall have the meaning specified in the Indenture.
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"Pay Out Commencement Date" shall mean the date on which a Trust Pay
-------------------------
Out Event is deemed to occur pursuant to Section 9.01 or a Series 2001-__ Pay
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Out Event is deemed to occur pursuant to Section 7 hereof.
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"Payment Request" shall have the meaning specified in the Indenture.
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"Permitted Assignee" shall mean any Person who, if it were the holder
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of an interest in the Trust, as applicable, would not cause the Trust to be
taxable as a publicly traded partnership for federal income tax purposes.
"Principal Account Investment Proceeds" shall mean, with respect to
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each Transfer Date, the investment earnings on deposits of Collections of
Principal Receivables for the related Monthly Period in the Principal Account
(net of investment expenses and losses) for the period from and including the
first day of the related Monthly Period to but excluding such Transfer Date.
"Principal Allocation Investor Interest" shall mean, on any date of
--------------------------------------
determination, an amount equal to the sum of (i) for any tranche of Notes in a
Note Amortization Period, the sum of the Nominal Liquidation Amounts for each
such tranche, each as of the last day of the Monthly Period prior to the
commencement of the most recent Note Amortization Period for such tranche and
(ii) for all other tranches of Notes Outstanding, the sum of the Nominal
Liquidation Amounts of each such tranche as of the close of business on the last
day of the immediately preceding Monthly Period (or, with respect to the first
Monthly Period for any tranche of Notes, the Initial Dollar Principal Amount of
such tranche).
"Principal Investor Percentage" shall mean, with respect to any
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Monthly Period, the percentage equivalent of a fraction, the numerator of which
is the Principal Allocation Investor Interest as of the close of business on the
last day of the preceding Monthly Period (or with respect to the first Monthly
Period, the Principal Allocation Investor Interest on the close of business on
the Closing Date) and the denominator of which is the greater of (a) the
aggregate amount of Principal Receivables in the Trust determined as of the
close of business on the last day of the prior Monthly Period (or with respect
to the first calendar month in the first Monthly
6
Period, the aggregate amount of Principal Receivables in the Trust determined as
of the close of business on the day preceding the Closing Date and with respect
to the second calendar month in the first Monthly Period, the aggregate amount
of Principal Receivables as of the close of business on the last day of the
first calendar month in the first Monthly Period), and (b) the sum of the
numerators used to calculate the Investor Percentages (as such term is defined
in the Agreement) for allocations with respect to Principal Receivables for all
outstanding Series on such date of determination; provided, however, that with
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respect to any Monthly Period in which the Investor Interest is increased on an
Allocation Reset Date as described in clause (a) of the definition thereof, the
numerator above, on and after the date of such increase, shall be the sum of the
Principal Allocation Investor Interest as of the close of business on the last
day of the preceding Monthly Period, the amount of such increase in the Investor
Interest on such Allocation Reset Date and the amount of any other increases in
the Investor Interest on any prior Allocation Reset Date occurring in such
Monthly Period; provided further, however, that with respect to any Monthly
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Period in which an Allocation Reset Date occurs, the denominator determined
pursuant to clause (a) hereof shall be, on and after such date, the aggregate
amount of Principal Receivables in the Trust as of the beginning of the day on
the most recently such occurring Allocation Reset Date (after adjusting for the
aggregate amount of Principal Receivables, if any, added to or removed from the
Trust on such Allocation Reset Date).
"Rapid Amortization Period" shall mean the Amortization Period
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commencing on the Pay Out Commencement Date and ending on the earlier to occur
of (a) the Series 2001-__ Termination Date and (b) the termination of the Trust
pursuant to Section 12.01 of the Agreement.
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"Rating Agency" shall mean, so long as any tranche of Notes is rated
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by Moody's, Moody's, so long as any tranche of Notes is rated by Standard &
Poor's, Standard & Poor's and, so long as any tranche of Notes is rated by
Fitch, Fitch.
"Rating Agency Condition" shall mean the notification in writing by
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each Rating Agency to the Seller, the Servicer and the Trustee that an action
will not result in any Rating Agency reducing or withdrawing its then existing
rating of the investor certificates of any outstanding Series or class of a
Series with respect to which it is a Rating Agency.
"Reallocated Available Funds" shall mean, with respect to any Monthly
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Period, the dollar amount equal to all amounts of Available Funds paid to the
Series 2001-__ Certificateholders and allocated to any series of Notes and
targeted to be deposited into a principal funding account on the related
Transfer Date pursuant to the Indenture, as notified to the Servicer pursuant to
a Payment Request.
"Reallocated Principal Amount" shall mean, with respect to any Monthly
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Period, the dollar amount equal to all amounts of Available Investor Principal
Collections paid to the Series 2001-__ Certificateholders and allocated to any
series of Notes and targeted to be deposited into an interest funding account or
paid to the Servicer as a portion of the Net Servicing Fee on the related
Transfer Date pursuant to the Indenture, as notified to the Servicer pursuant to
a Payment Request.
7
"Reassignment Amount" shall mean, with respect to any Transfer Date,
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the sum of (a) the Outstanding Dollar Principal Amount of all Notes on such
Transfer Date, (b) the Targeted Interest Deposit Amount with respect to the
immediately preceding Monthly Period and (c) any other fees and expenses of the
Indenture Trustee payable by the MBNA Credit Card Master Note Trust pursuant to
the Indenture, each after giving effect to any deposits and distributions
otherwise to be made on such Transfer Date.
"Revolving Period" shall mean the period from and including the
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Closing Date to, but not including, the Pay Out Commencement Date.
"Segregated Seller Interest" shall mean a dollar amount of the Seller
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Interest equal to the aggregate balance in the Principal Funding sub-Account for
each tranche of Notes, as notified to the Servicer pursuant to Section 4.09 of
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the Agreement.
"Series 2001-__" shall mean the Series of the MBNA Master Credit Card
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Trust II represented by the Investor Certificate.
"Series 2001-__ Certificate Representative" shall mean (a) if there is
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one Holder of the Series 2001-__ Certificate, such Holder or the designee of
such Holder, and (b) if there is more than one Holder of the Series 2001-__
Certificate, the designee of the Holders of a majority of the outstanding
principal balance of the Series 2001-__ Certificate.
"Series 2001-__ Certificateholders" shall mean the Holders of the
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Series 2001-__ Certificate.
"Series 2001-__ Certificate" shall mean any investor certificate
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executed by the Seller and authenticated by or on behalf of the Trustee,
substantially in the form of Exhibit A hereto.
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"Series 2001-__ Monthly Principal Payment" shall mean, with respect to
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any Monthly Period, an amount equal to (a) the Targeted Principal Deposit
Amount, plus (b) the Reallocated Principal Amount, minus (c) Reallocated
Available Funds, each for such Monthly Period.
"Series 2001-__ Pay Out Event" shall have the meaning specified in
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Section 7 hereof.
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"Series 2001-__ Termination Date" shall mean the earlier to occur of
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(a) the date designated by the Seller following the last Legal Maturity Date of
any tranche of Notes, and (b) the Trust Termination Date.
"Series Principal Shortfall" shall mean with respect to any Transfer
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Date, the excess, if any, of (a) (i) with respect to any Transfer Date relating
to the Revolving Period, the Targeted Principal Deposit Amount specified in the
applicable Payment Request for the related Monthly Period, and (ii) with respect
to any Transfer Date relating to the Rapid Amortization Period, the Investor
Interest over (b) the Investor Principal Collections, plus the Reallocated
8
Available Funds for such Transfer Date, minus the Reallocated Principal Amount
for such Transfer Date.
"Series Servicing Fee Percentage" shall mean 2.0%.
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"Servicer Interchange" shall mean, for any Transfer Date, the portion
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of Collections of Finance Charge Receivables allocated to the Investor
Certificate and deposited in the Finance Charge Account with respect to the
related Monthly Period that is attributable to Interchange; provided, however,
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that Servicer Interchange for any Transfer Date shall not exceed one-twelfth of
the product of (i) the Weighted Average Investor Interest for the related
Monthly Period and (ii) 0.75%; provided further, however, with respect to the
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first Transfer Date, the Servicer Interchange may equal but shall not exceed the
product of (i) the Weighted Average Investor Interest for the first Monthly
Period, (ii) 0.75% and (iii) a fraction, the numerator of which is [__] and the
denominator of which is 360; provided further, however, that in the event of a
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designation pursuant to the proviso in the definition of "Available Funds," the
portion of the Servicer Interchange in an amount equal to the relative portion
of Collections of Finance Charge Receivables so designated will be treated as
"Servicer Interchange" for the Transfer Date or Transfer Dates immediately
following the Monthly Period or Monthly Periods so designated.
"Shared Principal Collections" shall mean, with respect to any
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Transfer Date, either (a) the amount allocated to the Investor Certificate which
may be applied to the series principal shortfall with respect to other
outstanding Series in Group One or (b) the amounts allocated to the investor
certificates of other Series in Group One which the applicable Supplements for
such Series specify are to be treated as "Shared Principal Collections" and
which may be applied to cover the Series Principal Shortfall with respect to the
Investor Certificate.
"Subordinated Note Percentage" shall mean, on any date or
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determination, a fraction, the numerator of which is the aggregate Nominal
Liquidation Amount for all tranches of Notes which provide subordination
protection for any senior tranche of Notes and the denominator of which is the
aggregate Nominal Liquidation Amount for all tranches of Notes, each as of such
date of determination.
"Targeted Interest Deposit Amount" shall mean, for each tranche of
--------------------------------
Notes Outstanding with respect to any Monthly Period, the dollar amount equal to
all amounts targeted to be deposited into an interest funding account for each
tranche of Notes on the related Transfer Date, as notified to the Servicer
pursuant to a Payment Request.
"Targeted Principal Deposit Amount" shall mean, for each tranche of
---------------------------------
Notes Outstanding with respect to any Monthly Period, the dollar amount equal to
all amounts targeted to be deposited into a principal funding account for each
tranche of Notes on the related Transfer Date, as notified to the Servicer
pursuant to a Payment Request.
"Termination Proceeds" shall mean any proceeds arising out of a sale
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of Receivables (or interests therein) pursuant to Section 12.01(b) of the
----------------
Agreement with respect to Series 2001-__.
9
"Unallocated Principal Collections" shall have the meaning specified in
---------------------------------
subsection 4.05(c).
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"Weighted Average Investor Interest" shall mean, with respect to any period
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the sum of the Investor Interest as of the close of business on each day during
such period divided by the actual number of days in such period.
SECTION 3. Servicing Compensation and Assignment of Interchange.
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(a) The share of the Servicing Fee allocable to Series 2001-__ with respect
to any Transfer Date (the "Investor Servicing Fee") shall be equal to one-
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twelfth of the product of (i) the Series Servicing Fee Percentage and (ii) the
Weighted Average Investor Interest for the Monthly Period preceding such
Transfer Date; provided, however, with respect to the first Transfer Date, the
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Investor Servicing Fee shall be equal to the product of (i) the Weighted Average
Investor Interest for the first Monthly Period, (ii) the Series Servicing Fee
Percentage and (iii) a fraction, the numerator of which is [__] and the
denominator of which is 360; provided further, however, that in the event of a
-------- ------- -------
designation pursuant to the proviso in the definition of "Available Funds," the
portion of the Investor Servicing Fee in an amount equal to the relative portion
of the Collections of Finance Charge Receivables so designated will be included
in the Investor Servicing Fee for the Transfer Date or Transfer Dates
immediately following the Monthly Period or Monthly Periods so designated. On
each Transfer Date for which the Seller or The Bank of New York is the Servicer,
the Servicer Interchange with respect to the related Monthly Period that is on
deposit in the Finance Charge Account shall be withdrawn from the Finance Charge
Account and paid to the Servicer in payment of a portion of the Investor
Servicing Fee with respect to such Monthly Period. Should the Servicer
Interchange on deposit in the Finance Charge Account on any Transfer Date with
respect to the related Monthly Period be less than one-twelfth of 0.75% of the
Weighted Average Investor Interest for such Monthly Period, the Investor
Servicing Fee with respect to such Monthly Period will not be paid to the extent
of such insufficiency of Servicer Interchange on deposit in the Finance Charge
Account; provided, however, that the Servicer Interchange with respect to the
-------- -------
first Transfer Date may equal but shall not exceed the product of (i) the
Weighted Average Investor Interest for the first Monthly Period, (ii) 0.75% and
(iii) a fraction, the numerator of which is [__] and the denominator of which is
360; provided further, however, that in the event of a designation pursuant to
-------- ------- -------
the proviso in the definition of "Available Funds," the portion of the Servicer
Interchange in an amount equal to the relative portion of the Collections of
Finance Charge Receivables so designated will be treated as "Servicer
Interchange" for the Transfer Date or Transfer Dates immediately following the
Monthly Period or Monthly Periods so designated. The share of the Investor
Servicing Fee allocable to the Series 2001-__ Certificate with respect to any
Transfer Date (the "Net Servicing Fee") shall be equal to one-twelfth of the
-----------------
product of (i) the Net Servicing Fee Rate and (ii) the Weighted Average Investor
Interest for the related Monthly Period; provided, however, with respect to the
-------- -------
first Transfer Date, the Net Servicing Fee shall be equal to the product of (i)
the Weighted Average Investor Interest for the first Monthly Period, (ii) the
Net Servicing Fee Percentage and (iii) a fraction, the numerator of which is
[__] and the denominator of which is 360; provided further, however, that in the
-------- ------- -------
event of a designation pursuant to the proviso in the definition of "Available
Funds," the portion of the Net
10
Servicing Fee in an amount equal to the relative portion of the Collections of
Finance Charge Receivables so designated will be included in the Net Servicing
Fee for the Transfer Date or Transfer Dates immediately following the Monthly
Period or Monthly Periods so designated. Except as specifically provided above,
the Servicing Fee shall be paid by the cash flows from the Trust allocated to
the Seller or the certificateholders of other Series (as provided in the related
Supplements) and in no event shall the Trust, the Trustee or the Investor
Certificateholders be liable therefor. The Net Servicing Fee shall be payable to
the Servicer solely to the extent amounts are available for distribution in
respect thereof pursuant to the Indenture.
(b) On or before each Transfer Date, the Seller shall notify the Servicer
of the amount of Interchange to be included as Collections of Finance Charge
Receivables and allocable to the Investor Certificateholders with respect to the
preceding Monthly Period as determined pursuant to this subsection 3(b). Such
---------------
amount of Interchange shall be equal to the product of (i) the total amount of
Interchange paid or payable to the Seller with respect to such Monthly Period,
(ii) a fraction the numerator of which is the aggregate amount of cardholder
charges for goods and services in the Accounts with respect to such Monthly
Period and the denominator of which is the aggregate amount of cardholder
charges for goods and services in [all MasterCard and VISA consumer revolving
credit card accounts owned by the Seller] with respect to such Monthly Period
and (iii) the Investor Percentage with regard to Finance Charge Receivables. On
each Transfer Date, the Seller shall pay to the Servicer, and the Servicer shall
deposit into the Finance Charge Account, in immediately available funds, the
amount of Interchange to be so included as Collections of Finance Charge
Receivables allocable to the Investor Certificate with respect to the preceding
Monthly Period. The Seller hereby assigns, sets-over, conveys, pledges and
grants a security interest and lien to the Trustee for the benefit of the
Investor Certificateholders in Interchange and the proceeds of Interchange, as
set forth in this subsection 3(b). In connection with the foregoing grant of a
---------------
security interest, this Series Supplement shall constitute a security agreement
under applicable law. To the extent that a Supplement for a related Series,
other than Series 2001-__, assigns, sets-over, conveys, pledges or grants a
security interest in Interchange allocable to the Trust, all Investor
Certificates of any such Series (except as otherwise specified in any such
Supplement) and the Investor Certificate shall rank pari passu and be equally
and ratably entitled as provided herein to the benefits of such Interchange
without preference or priority on account of the actual time or times of
authentication and delivery, all in accordance with the terms and provisions of
this Series Supplement and other related Supplements.
SECTION 4. Delivery of the Certificate.
---------------------------
The Seller shall execute and deliver the Series 2001-__ Certificate to the
Trustee for authentication in accordance with Section 6.01 of the Agreement.
------------
The Trustee shall deliver such Certificate when authenticated in accordance with
Section 6.02 of the Agreement.
------------
The Certificate shall be delivered as a Book-Entry Certificate as provided
in Sections 6.01 and 6.10 of the Agreement.
------------- ----
11
SECTION 5. Article IV of the Agreement.
---------------------------
(a) Except as otherwise provided in Section 5(b), Sections 4.01, 4.02
------------ ------------- ----
and 4.03 shall be read in their entirety as provided in the Agreement.
----
(b) Notwithstanding any provision of the Agreement or this Series
Supplement to the contrary, Section 4.02(e) of the Agreement shall be amended to
---------------
provide that on each Transfer Date the Trustee, at the Servicer's direction
given on or before such Transfer Date, shall (i) treat as Available Funds in
accordance with Section 4.06(a) Series 2001-__'s pro rata portion of Finance
---------------
Charge Account Investment Proceeds with respect to such Transfer Date based on
the ratio of the aggregate amount on deposit in the Finance Charge Account with
respect to Series 2001-__ at the commencement of such Transfer Date to the
amount on deposit in the Finance Charge Account at the commencement of such
Transfer Date and (ii) treat as Available Funds in accordance with Section
-------
4.06(a) Series 2001-__'s pro rata portion of Principal Account Investment
-------
Proceeds with respect to such Transfer Date based on the ratio of the aggregate
amount on deposit in the Principal Account with respect to Series 2001-__ at the
commencement of such Transfer Date to the aggregate amount on deposit in the
Principal Account at the commencement of such Transfer Date.
(c) Article IV (except for Sections 4.01, 4.02 and 4.03 thereof) shall
------------- ---- ----
be read in its entirety as follows and shall be applicable only to the Investor
Certificate:
ARTICLE IV
RIGHTS OF CERTIFICATEHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION 4.04 Rights of Certificateholders. The Investor Certificate
----------------------------
shall represent undivided interests in the Trust, consisting of the right to
receive, to the extent necessary to make the required payments with respect to
such Investor Certificate at the times and in the amounts specified in this
Agreement, (a) the Floating Investor Percentage and Principal Investor
Percentage (as applicable from time to time) of Collections received with
respect to the Receivables and (b) funds on deposit in the Collection Account,
the Finance Charge Account and the Principal Account. The Seller Interest shall
not represent any interest in the Collection Account, the Finance Charge Account
or the Principal Account, except as specifically provided in this Article IV.
----------
SECTION 4.05 Allocations.
-----------
(a) Allocations During the Revolving Period. During the Revolving
---------------------------------------
Period, the Servicer shall, prior to the close of business on the day any
Collections are deposited in the Collection Account, allocate to the Investor
Certificateholders or the Holder of the Seller Interest and pay or deposit from
the Collection Account the following amounts as set forth below:
(i) Allocate to the Investor Certificateholders the product of (y) the
Floating Investor Percentage on the Date of Processing of such Collections
and (z) the aggregate amount of Collections of Finance Charge Receivables
on such Date of Processing, and of that allocation, deposit in the Finance
Charge Account an amount equal to either (I) (A)
12
prior to the date on which the amount of the Targeted Interest Deposit
Amount with respect to the related Monthly Period is provided to the
Servicer, an amount equal to the product of (1) the Floating Investor
Percentage on the Date of Processing of such Collections and (2) the
aggregate amount of Collections of Finance Charge Receivables on such Date
of Processing, and (B) at all other times, the difference between (1) the
sum of (x) the Targeted Interest Deposit Amount, (y) if the Seller or The
Bank of New York is not the Servicer, the Net Servicing Fee and (z) the
Investor Default Target Deposit Amount, each with respect to the related
Monthly Period and (2) the amounts previously deposited in the Finance
Charge Account with respect to the current Monthly Period pursuant to this
subsection 4.05(a)(i) or (II) the amount of Collections of Finance Charge
---------------------
Receivables allocated to the Investor Certificateholders on such Date of
Processing pursuant to this subsection 4.05(a)(i); provided, that if a
--------------------- --------
deposit pursuant to subsection 4.05(a)(i)(I) is made on any Date of
------------------------
Processing, on the related Transfer Date, the Servicer shall withdraw from
the Collection Account and deposit into the Finance Charge Account an
amount equal to the amount of Collections of Finance Charge Receivables
that have been allocated to the Investor Certificateholders during the
related Monthly Period but not previously deposited in the Finance Charge
Account. Funds deposited into the Finance Charge Account pursuant to this
subsection 4.05(a)(i) shall be applied in accordance with Section 4.06.
--------------------- ------------
(ii) Allocate to the Investor Certificateholders an amount equal to
the product of (1) the Principal Investor Percentage on the Date of
Processing of such Collections and (2) the aggregate amount of Collections
processed in respect of Principal Receivables on such Date of Processing,
and, of such amount:
(A) deposit in the Principal Account on each such Date of
Processing an amount equal to the Daily Principal Shortfall;
(B) deposit in the Principal Account the following amounts:
(1) on each such Date of Processing, an amount equal to the
lesser of (x) the Subordinated Note Percentage of the Collections
in respect of Principal Receivables allocated to the Investor
Certificateholders pursuant to this subsection 4.05(a)(ii) and
----------------------
(y) the Investor Default Target Deposit Amount for the related
Monthly Period; provided, however, that the aggregate amount
-------- -------
deposited in the Principal Account pursuant to this Section
-------
4.05(a)(ii)(B)(1) for such Monthly Period shall not exceed an
-----------------
amount equal to the excess, if any, of (x) the Investor Default
Target Deposit Amount over (y) the aggregate amount deposited i
----
the Finance Charge Account pursuant to subsection 4.05(a)(i) for
---------------------
such Monthly Period, in excess of the sum of the Targeted
Interest Deposit Amount and, if the Seller or the Bank of New
York is not the Servicer, the Net Servicing Fee; and
(2) on the related Transfer Date, deposit in the Principal
Account an amount equal to the lesser of (x) the Subordinated
Note Percentage of the Collections in respect of Principal
Receivables allocated
13
to the Investor Certificateholders pursuant to this subsection
----------
4.05(a)(ii) and (y) the excess, if any, of Reallocated Principal
-----------
Amount for the related Monthly Period over the aggregate amount
----
on deposit in the Principal Account pursuant to subsection
----------
4.05(a)(ii)(B)(1) on the close of business on the last day of the
-----------------
related Monthly Period; and
(C) pay to the Holder of the Seller Interest on the related
Transfer Date an amount equal to any excess; provided, however, that
-------- -------
the amount to be paid to the Holder of the Seller Interest pursuant to
this subsection 4.05(a)(ii)(C) with respect to any Date of Processing
-------------------------
shall be paid to the Holder of the Seller Interest if, and only to the
extent that, the Seller Interest on such Transfer Date is equal to or
greater than the Minimum Seller Interest (after giving effect to the
inclusion in the Trust of all Receivables created on or prior to such
Date of Processing and the application of payments referred to in
subsection 4.03(b)) and otherwise shall be considered as Unallocated
------------------
Principal Collections and deposited into the Principal Account in
accordance with subsection 4.05(c).
------------------
(b) Allocations During the Rapid Amortization Period. During the
------------------------------------------------
Rapid Amortization Period, the Servicer shall, prior to the close of business on
the day any Collections are deposited in the Collection Account, allocate to the
Investor Certificateholders and pay or deposit from the Collection Account the
following amounts as set forth below:
(i) Deposit into the Finance Charge Account an amount equal to the
product of (A) the Floating Investor Percentage on the Date of Processing
of such Collections and (B) the aggregate amount of Collections processed
in respect of Finance Charge Receivables on such Date of Processing to be
applied in accordance with Section 4.06.
------------
(ii) (A) Deposit into the Principal Account an amount equal to the
product of (1) the Principal Investor Percentage on the Date of Processing
of such Collections and (2) the aggregate amount of Collections processed
in respect of Principal Receivables on such Date of Processing; provided,
--------
however, that the amount deposited into the Principal Account pursuant to
-------
this subsection 4.05(b)(ii)(A) shall not exceed the Investor Interest as of
-------------------------
the close of business on the last day of the prior Monthly Period (after
taking into account any payments, deposits and adjustments to be made to
the Investor Interest on the Transfer Date relating to such Monthly Period)
and (B) pay to the Holder of the Seller Interest an amount equal to the
excess, if any, identified in the proviso to clause (A) above; provided,
--------
however, that the amount to be paid to the Holder of the Seller Interest
-------
pursuant to this subsection 4.05(b)(ii)(B) with respect to any Date of
-------------------------
Processing shall be paid to the Holder of the Seller Interest if, and only
to the extent that, the Seller Interest on such Date of Processing is equal
to or greater than the Minimum Seller Interest (after giving effect to the
inclusion in the Trust of all Receivables created on or prior to such Date
of Processing and the application of payments referred to in subsection
----------
4.03(b)) and otherwise shall be considered as Unallocated Principal
-------
Collections and deposited into the Principal Account in accordance with
subsection 4.05(c).
------------------
(c) Unallocated Principal Collections. Any Collections in respect of
---------------------------------
Principal Receivables not allocated and paid to the Holder of the Seller
Interest because of the limitations
14
contained in subsections 4.05(a)(ii)(C) and 4.05(b)(ii)(B) and any amounts
-------------------------- --------------
allocable to the Investor Certificate deposited in the Principal Account
pursuant to subsections 2.04(d)(iii) and 4.03(c) ("Unallocated Principal
------------------------ ------- ---------------------
Collections") shall be held in the Principal Account and, first, paid to the
-----------
Holder of the Seller Interest if, and only to the extent that, the Seller
Interest is greater than the Minimum Seller Interest and then included in the
Investor Principal Collections and distributed as Available Investor Principal
Collections to be applied pursuant to Section 4.06.
------------
(d) Payments. With respect to the Investor Certificate, and
--------
notwithstanding anything in the Agreement or this Series Supplement to the
contrary, whether or not the Servicer is required to make monthly or daily
deposits from the Collection Account into the Finance Charge Account or the
Principal Account pursuant to subsections 4.05(a) or 4.05(b), with respect to
------------------- -------
any Monthly Period (i) the Servicer will only be required to deposit Collections
from the Collection Account into the Finance Charge Account or the Principal
Account up to the required amount to be deposited into any such deposit account
and distributed on or prior to the related Transfer Date to the Investor
Certificateholders and (ii) if at any time prior to such Transfer Date the
amount of Collections deposited in the Collection Account, the Finance Charge
Account or the Principal Account exceeds the amount required to be deposited
pursuant to clause (i) above, the Servicer will be permitted to withdraw the
excess from the Collection Account, the Finance Charge Account or the Principal
Account, as applicable.
SECTION 4.06 Monthly Payments. On or before each Transfer Date, the
----------------
Servicer shall instruct the Trustee in writing (which writing shall be
substantially in the form of Exhibit B hereto) to withdraw and the Trustee,
---------
acting in accordance with such instructions, shall withdraw on such Transfer
Date, to the extent of available funds, the amounts required to be withdrawn
from the Finance Charge Account and the Principal Account as follows:
(a) An amount equal to the Available Funds deposited into the Finance
Charge Account for the related Monthly Period will be paid on each Transfer Date
to the Series 2001-__ Certificateholders in accordance with Section 5.01.
------------
(b) During the Revolving Period, an amount equal to the Available
Investor Principal Collections deposited into the Principal Account for the
related Monthly Period will be distributed on each Transfer Date in the
following priority:
(i) an amount equal to the lesser of (A) the Available Investor
Principal Collections for such Transfer Date and (B) an amount equal to the
Series 2001-__ Monthly Principal Payment for the related Monthly Period,
shall be paid on each Transfer Date to the Series 2001-__
Certificateholders in accordance with Section 5.01;
------------
(ii) an amount equal to the lesser of (A) the Available Investor
Principal Collections remaining after the application specified in
subsection 4.06(b)(i) above and (B) the product of (1) a fraction, the
---------------------
numerator of which is equal to the Available Investor Principal Collections
remaining after the application specified in subsection 4.06(b)(i) above
---------------------
for such Transfer Date and the denominator of which is equal to the sum of
the Available Investor Principal Collections available for sharing as
specified in the related Series Supplement for each Series in Group One and
(2) the Cumulative Series
15
Principal Shortfall shall remain in the Principal Account to be treated as
Shared Principal Collections and applied to Series in Group One other than
this Series 2001-__; and
(iii) an amount equal to the excess, if any, of (A) the Available
Investor Principal Collections for such Transfer Date over (B) the
applications specified in subsections 4.06(b)(i) and (ii) above shall be
---------------------- ----
paid to the Holder of the Seller Interest; provided, however, that the
-------- -------
amount to be paid to the Holder of the Seller Interest pursuant to this
subsection 4.06(b)(iii) with respect to such Transfer Date shall be paid to
-----------------------
the Holder of the Seller Interest if, and only to the extent that, the
Seller Interest on such Date of Processing is equal to or greater than the
Minimum Seller Interest (after giving effect to the inclusion in the Trust
of all Receivables created on or prior to such Transfer Date and the
application of payments referred to in subsection 4.03(b)) and otherwise
------------------
shall be considered as Unallocated Principal Collections and deposited into
the Principal Account in accordance with subsection 4.05(c).
------------------
(c) During the Rapid Amortization Period, an amount equal to the
Available Investor Principal Collections deposited into the Principal Account
for the related Monthly Period will be distributed on each Transfer Date in the
following priority:
(i) an amount equal to the Investor Interest shall be paid on each
Transfer Date to the Series 2001-__ Certificateholders in accordance with
Section 5.01;
------------
(ii) an amount equal to the excess, if any, of (A) the Available
Investor Principal Collections over (B) the applications specified in
subsections 4.06(c)(i) above shall be paid to the Holder of the Seller
----------------------
Interest; provided, however, that the amount to be paid to the Holder of
-------- -------
the Seller Interest pursuant to this subsection 4.06(c)(ii) with respect to
----------------------
such Transfer Date shall be paid to the Holder of the Seller interest if,
and only to the extent that, the Seller Interest on such Date of Processing
is equal to or greater than the Minimum Seller Interest (after giving
effect to the inclusion in the Trust of all Receivables created on or prior
to such Transfer Date and the application of payments referred to in
subsection 4.03(b)) and otherwise shall be considered as Unallocated
------------------
Principal Collections and deposited into the Principal Account in
accordance with subsection 4.05(c).
------------------
SECTION 4.07 Shared Principal Collections.
----------------------------
(a) The portion of Shared Principal Collections on deposit in the
Principal Account equal to the amount of Shared Principal Collections allocable
to Series 2001-__ on any Transfer Date shall be applied as an Available Investor
Principal Collection pursuant to Section 4.06 and pursuant to such Section 4.06
------------ ------------
shall be paid on such Transfer Date to the Series 2001-__ Certificate
Representative.
(b) Shared Principal Collections allocable to Series 2001-__ with
respect to any Transfer Date shall mean an amount equal to the Series Principal
Shortfall, if any, with respect to Series 2001-__ for such Transfer Date;
provided, however, that if the aggregate amount of Shared Principal Collections
-------- -------
for all Series for such Transfer Date is less than the Cumulative Series
Principal Shortfall for such Transfer Date, then Shared Principal Collections
16
allocable to Series 2001-__ on such Transfer Date shall equal the product of (i)
Shared Principal Collections for all Series for such Transfer Date and (ii) a
fraction, the numerator of which is the Series Principal Shortfall with respect
to Series 2001-__ for such Transfer Date and the denominator of which is the
aggregate amount of Cumulative Series Principal Shortfall for all Series for
such Transfer Date.
(c) Solely for the purpose of determining the amount of Available
Investor Principal Collections to be treated as Shared Principal Collections on
any Transfer Date allocable to other Series in Group One, on each Determination
Date, the Servicer shall determine the amount of Shared Principal Collections
with respect to Series 2001-__ as of such Determination Date for the following
Transfer Date.
SECTION 4.08 Seller's or Servicer's Failure to Make a Deposit or
---------------------------------------------------
Payment.
-------
If the Servicer or the Seller fails to make, or give instructions to
make, any payment or deposit (other than as required by subsections 2.04(d) and
-------------------
(e) and 12.02(a) or Sections 10.02 and 12.01) required to be made or given by
--- -------- -------------- -----
the Servicer or Seller, respectively, at the time specified in the Agreement
(including applicable grace periods), the Trustee shall make such payment or
deposit from the applicable Investor Account without instruction from the
Servicer or Seller. The Trustee shall be required to make any such payment,
deposit or withdrawal hereunder only to the extent that the Trustee has
sufficient information to allow it to determine the amount thereof. The
Servicer shall, upon request of the Trustee, promptly provide the Trustee with
all information necessary to allow the Trustee to make such payment, deposit or
withdrawal. Such funds or the proceeds of such withdrawal shall be applied by
the Trustee in the manner in which such payment or deposit should have been made
by the Seller or the Servicer, as the case may be.
SECTION 4.09 Collections of Finance Charge Receivables Allocable to
------------------------------------------------------
Segregated Seller Interest.
--------------------------
The Series 2001-_ Certificate Representative may from time to time
notify the Servicer of the amount of the Seller Interest that is to be the
Segregated Seller Interest in an amount equal to the amounts on deposit in the
Principal Funding sub-Accounts (as defined in the Indenture) for any tranche of
Notes. The Series 2001-_ Certificate Representative may from time to time, with
respect to any Monthly Period, request a payment to be made from Collections of
Finance Charge Receivables allocable to the Segregated Seller Interest held in
the Collection Account, in an amount not greater than the lesser of:
(a) the aggregate amount of all Principal Funding sub-Account Earnings
Shortfalls for all tranches of Notes with respect to such Monthly Period,
and
(b) the aggregate amount of all Collections of Finance Charge
Receivables allocable to the Segregated Seller Interest with respect to
such Monthly Period less any portion of the Defaulted Receivables and the
Servicing Fee allocable to the Segregated Seller Interest with respect to
such Monthly Period pursuant to Section 4.03(b).
---------------
17
The Servicer shall pay such amount to the Series 2001-_ Certificateholders on
the related Transfer Date.
SECTION 6. Article V of the Agreement. Article V of the Agreement
--------------------------
shall read in its entirety as follows and shall be applicable only to the
Investor Certificateholders:
ARTICLE V
DISTRIBUTIONS AND REPORTS TO INVESTOR
CERTIFICATEHOLDERS
SECTION 5.01. Distributions. On each Transfer Date, the Trustee shall
-------------
distribute (in accordance with the certificate delivered on or before the
related Transfer Date by the Servicer to the Trustee pursuant to subsection
----------
3.04(b)) to the Series 2001-__ Certificate Representative the aggregate amount
-------
payable to the Series 2001-__ Certificateholders pursuant to Section 4.06 to the
------------
account of the Series 2001-__ Certificate Representative, as specified in
writing by the Series 2001-__ Certificate Representative, in immediately
available funds.
SECTION 5.02. Monthly Series Certificateholders' Statement. On or
--------------------------------------------
before each Transfer Date, the Trustee shall forward to the Series 2001-__
Certificate Representative and each Rating Agency a statement substantially in
the form of Exhibit C to this Series Supplement prepared by the Servicer,
---------
delivered to the Trustee and setting forth, among other things, the following
information:
(i) the amount of the current distribution;
(ii) the amount of the current distribution which constitute
Available Funds and Available Investor Principal Collections;
(iii) the amount of Collections of Principal Receivables processed
during the related Monthly Period and allocated to Series 2001-__;
(iv) the amount of Collections of Finance Charge Receivables
processed during the related Monthly Period and allocated to Series 2001-
__;
(v) the aggregate amount of Principal Receivables, the Investor
Interest, the Principal Allocation Investor Interest, the Floating Investor
Percentage and the Principal Investor Percentage with respect to the
Principal Receivables in the Trust as of the end of the day on the Record
Date;
(vi) the aggregate outstanding balance of Accounts which were 30 to
59, 60 to 89, 90 to 119, 120 to 149 and 150 or more days delinquent as of
the end of the day on the Record Date;
(vii) the Aggregate Investor Default Amount for the related Monthly
Period;
(viii) the amount of the Investor Servicing Fee, the Net Servicing
Fee and the Servicer Interchange for the related Monthly Period;
18
(ix) the Investor Interest and the Principal Allocation Investor
Interest as of the close of business on such Transfer Date; and
(x) such other items as are set forth in Exhibit C to this Series
---------
Supplement.
SECTION 7. Series 2001-__ Pay Out Events. If any one of the
-----------------------------
following events shall occur with respect to the Investor Certificate:
(a) failure on the part of the Seller (i) to make any payment or
deposit required by the terms of the Agreement or this Series Supplement, on or
before the date occurring five days after the date such payment or deposit is
required to be made herein or (ii) duly to observe or perform in any material
respect any covenants or agreements of the Seller set forth in the Agreement or
this Series Supplement, which failure has a material adverse effect on the
Series 2001-__ Certificateholders and which continues unremedied for a period of
60 days after the date on which written notice of such failure, requiring the
same to be remedied, shall have been given to the Seller by the Trustee, or to
the Seller and the Trustee by the Holders of the Investor Certificate evidencing
Undivided Interests aggregating not less than 50% of the Investor Interest of
this Series 2001-__, and continues to affect materially and adversely the
interests of the Series 2001-__ Certificateholders for such period;
(b) any representation or warranty made by the Seller in the
Agreement or this Series Supplement, or any information contained in a computer
file or microfiche list required to be delivered by the Seller pursuant to
Section 2.01 or 2.06 of the Agreement, (i) 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 Seller by the Trustee, or to the Seller and the Trustee
by the Holders of the Investor Certificate evidencing Undivided Interests
aggregating not less than 50% of the Investor Interest of this Series 2001-__,
and (ii) as a result of which the interests of the Series 2001-__
Certificateholders are materially and adversely affected and continue to be
materially and adversely affected for such period; provided, however, that a
-------- -------
Series 2001-__ Pay Out Event pursuant to this subsection 7(b) hereof shall not
---------------
be deemed to have occurred hereunder if the Seller has accepted reassignment of
the related Receivable, or all of such Receivables, if applicable, during such
period in accordance with the provisions of the Agreement;
(c) the Seller shall fail to convey Receivables arising under
Additional Accounts, or Participations, to the Trust, as required by subsection
----------
2.06(a); or
-------
(d) any Servicer Default shall occur which would have a material
adverse effect on the Series 2001-__ Certificateholders;
then, in the case of any event described in subsection 7(a), (b) or (d) hereof,
--------------- --- ---
after the applicable grace period set forth in such subparagraphs, if any,
either the Trustee or Holders of the Series 2001-__ Certificate evidencing
Undivided Interests aggregating not less than 50% of the Investor Interest of
this Series 2001-__ by notice then given in writing to the Seller and the
Servicer (and to the Trustee if given by the Certificateholders) may declare
that a pay out event (a "Series 2001-__ Pay Out Event") has occurred as of the
-----------------------------
date of such notice, and in the case of
19
any event described in subsection 7(c) hereof, a Series 2001-__ Pay Out Event
---------------
shall occur without any notice or other action on the part of the Trustee or the
Investor Certificateholders immediately upon the occurrence of such event.
SECTION 8. Sale of Investor Interest Pursuant to Section 2.04(e) or
--------------------------------------------------------
10.02(a) of the Agreement.
-------------------------
(a) (i) Notwithstanding anything to the contrary in this Series
Supplement or the Agreement, the reassignment deposit amount with respect
to Series 2001-__ in connection with a reassignment of Principal
Receivables pursuant to Section 2.04(e) of the Agreement shall be equal to
---------------
the Reassignment Amount for the first Transfer Date following the Monthly
Period in which such reassignment obligation arises under the Agreement.
(ii) Notwithstanding anything to the contrary in this Series
Supplement or the Agreement, the minimum bid in connection with a sale of
Receivables pursuant to Section 10.02(a) of the Agreement shall be equal to
----------------
the Reassignment Amount for the first Transfer Date following the Monthly
Period in which such sale of receivables obligation arises under the
Agreement.
(b) With respect to the proceeds from any reassignment of Principal
Receivables available for distribution to the Series 2001-__ Certificateholders
as described in this Section 8 or any Termination Proceeds from the sale of
---------
Receivables (or interests therein) allocable to the Investor Interest deposited
into the Collection Account pursuant to Section 12.01(b) of the Agreement, the
----------------
Trustee shall, not later than 12:00 noon, New York City time, on the following
Transfer Date, make deposits or distributions of such amounts and pay such
amounts to the Series 2001-__ Certificateholders.
(c) Notwithstanding anything to the contrary in this Series Supplement or
the Agreement, the entire amount payable to the Series 2001-__
Certificateholders pursuant to Section 10.02(a) of the Agreement and all amounts
----------------
available for distribution to the Series 2001-__ Certificateholders shall be
distributed in full to the Series 2001-__ Certificateholders on such date and
shall be deemed to be a final distribution pursuant to Section 12.01 of the
-------------
Agreement.
SECTION 9. Distribution of Proceeds of Sale, Disposition or
------------------------------------------------
Liquidation of the Receivables Pursuant to Section 9.02 of the Agreement.
------------------------------------------------------------------------
(a) Not later than 12:00 noon, New York City time, on the Transfer Date
following the date on which Insolvency Proceeds are deposited into the
Collection Account pursuant to Section 9.02(b) of the Agreement, the Trustee
---------------
shall (after giving effect to any deposits and distributions otherwise to be
made on such Transfer Date) deduct from the Collection Account an amount equal
to the Investor Interest on such Transfer Date from the portion of the
Insolvency Proceeds allocated to Collections of Principal Receivables and pay
such amount to the Series 2001-__ Certificateholders, provided that the amount
--------
of such payment shall not exceed the product of (x) the portion of the
Insolvency Proceeds allocated to Collections of Principal Receivables and (y)
the Principal Investor Percentage with respect to the related Monthly Period.
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The remainder of the portion of the Insolvency Proceeds allocated to Collections
of Principal Receivables and not allocated to other Series shall be allocated to
the Seller Interest and shall be released to the Seller on such Transfer Date.
(b) Not later than 12:00 noon, New York City time, on such Transfer Date,
the Trustee shall (in the following priority and, in each case, after giving
effect to any deposits and distributions otherwise to be made on such Transfer
Date) deduct from the Collection Account an amount equal to the product of (x)
the portion of the Insolvency Proceeds allocated to Collections of Finance
Charge Receivables and (y) the Floating Investor Percentage with respect to such
Monthly Period, and pay such amount to the Series 2001-__ Certificateholders.
The remainder of the Insolvency Proceeds allocated to Collections of Finance
Charge Receivables and not allocated to other Series shall be distributed to the
Seller on such Transfer Date.
(c) Notwithstanding anything to the contrary in this Series Supplement or
the Agreement, the entire amount to be paid to the Series 2001-__
Certificateholders pursuant to this Section, and all amounts on deposit in the
Collection Account for distribution to the Series 2001-__ Certificateholders
shall be distributed in full to the Series 2001-__ Certificateholders on the
Transfer Date on which funds are deposited pursuant to this Section (or, if not
so deposited on a Transfer Date, on the immediately following Transfer Date) and
shall be deemed to be a final distribution pursuant to Section 12.01 of the
--------------
Agreement.
(d) Notwithstanding any provision of the Agreement or this Series
Supplement, for purposes of Section 9.02(a) of the Agreement, the Holders of the
---------------
Series 2001-__ Certificates shall be deemed to have disapproved a liquidation of
the Receivables following an Insolvency Event with respect to the Seller.
SECTION 10. Sale of Receivables. Upon notice to the Servicer by the
-------------------
Series 2001-__ Certificate Representative pursuant to the Indenture with respect
to any tranche of accelerated Notes or any tranche of Notes which has reached
its Legal Maturity Date, the Trustee will cause the Trust to sell to a Permitted
Assignee Principal Receivables and the related Finance Charge Receivables (or
interests therein) in an amount specified by the Series 2001-__ Certificate
Representative which shall be a portion of the Investor Interest of Series 2001-
__ equal to the Nominal Liquidation Amount of the affected tranche of Notes,
calculated as of the end of the prior Monthly Period (after giving effect to
deposits and distributions otherwise to be made with respect to such Monthly
Period). The proceeds from such sale shall be immediately paid to the Series
2001-__ Certificate Representative.
SECTION 11. Series 2001-__ Termination. The right of the Investor
--------------------------
Certificateholders to receive payments from the Trust will terminate on the
first Business Day following the earlier to occur of (i) the date designated by
the Seller following the last Legal Maturity Date of any tranche of Notes, and
(ii) the Trust Termination Date.
SECTION 12. Counterparts. This Series Supplement may be executed in
------------
any number of counterparts, each of which so executed shall be deemed to be an
original, but all of such counterparts shall together constitute but one and the
same instrument.
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SECTION 13. Governing Law. THIS SERIES SUPPLEMENT SHALL BE CONSTRUED
-------------
IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS; PROVIDED,
--------
HOWEVER, THAT THE IMMUNITIES AND STANDARD OF CARE OF THE TRUSTEE IN THE
-------
ADMINISTRATION OF THE TRUST HEREUNDER SHALL BE GOVERNED BY THE LAWS OF THE STATE
OF NEW YORK.
SECTION 14. Additional Notices. For so long as the Investor
------------------
Certificate shall be outstanding, the Seller agrees to provide Fitch with the
notice provided to each Rating Agency in subsection 2.06(c)(i) of the Agreement
---------------------
and agrees to provide to Fitch and Standard and Poor's the Opinion of Counsel
provided to Moody's pursuant to subsection 2.06(c)(vi) of the Agreement, in each
----------------------
case in the times and the manner provided for in such subsections.
SECTION 15. Additional Representations and Warranties of the Servicer.
---------------------------------------------------------
MBNA America Bank, National Association, as initial Servicer, hereby makes, and
any Successor Servicer by its appointment under the Agreement shall make the
following representations and warranties:
(a) All Consents. All authorizations, consents, orders or approvals
------------
of or registrations or declarations with any Governmental Authority required to
be obtained, effected or given by the Servicer in connection with the execution
and delivery of this Series Supplement by the Servicer and the performance of
the transactions contemplated by this Series Supplement by the Servicer, have
been duly obtained, effected or given and are in full force and effect.
(b) Rescission or Cancellation. The Servicer shall not permit any
--------------------------
rescission or cancellation of any Receivable except as ordered by a court of
competent jurisdiction or other Governmental Authority or in accordance with the
normal operating procedures of the Servicer.
(c) Receivables Not To Be Evidenced by Promissory Notes. Except in
---------------------------------------------------
connection with its enforcement or collection of an Account, the Servicer will
take no action to cause any Receivable to be evidenced by an instrument (as
defined in the UCC as in effect in the State of Delaware).
SECTION 16. No Petition. The Seller, the Servicer and the Trustee, by
-----------
entering into this Series Supplement and each Certificateholder, by accepting
the Series 2001-__ Certificate or any portion thereof hereby covenant and agree
that they will not at any time institute against the Trust, or join in any
institution against the Trust of, any bankruptcy proceedings under any United
States Federal or state bankruptcy or similar law in connection with any
obligations relating to the Investor Certificateholders, the Agreement or this
Series Supplement.
SECTION 17. Certain Tax Related Amendments. In addition to being
------------------------------
subject to amendment pursuant to any other provisions relating to amendments in
either the Agreement or this Series Supplement, this Series Supplement may be
amended by the Seller without the consent of the Servicer, Trustee or any
Investor Certificateholder if the Seller provides the
22
Trustee with (i) an Opinion of Counsel to the effect that such amendment or
modification would reduce the risk the Trust would be treated as taxable as a
publicly traded partnership pursuant to Code section 7704 and (ii) a 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 the Trustee's consent, if the Trustee's rights, duties and
obligations hereunder are thereby modified. Promptly after the effectiveness of
any amendment pursuant to this Section 14, the Seller shall deliver a copy of
----------
such amendment to each of the Servicer, the Trustee and each Rating Agency.
SECTION 18. Treatment of Noteholders. Subject to Section 9(d), for
------------------------ ------------
purposes of any provision of the Agreement or this Series Supplement requiring
of permitting actions with the consent of, or at the direction of, Investor
Certificateholders holding a specified percentage of the aggregate unpaid
principal amount of Investor Certificates (a) each Noteholder will be deemed to
be a Certificateholder; (b) each Noteholder will be deemed to be the Holder of
an aggregate unpaid principal amount of Series 2001-__ Certificates equal to the
Adjusted Outstanding Dollar Principal Amount of such Noteholder's Notes; (c)
each series of Notes under the Indenture will be deemed to be a separate Series
of Investor Certificates and the Holder of a Note of such series will be deemed
to be the Holder of an aggregate unpaid principal amount of such Series of
Investor Certificates equal to the Adjusted Outstanding Dollar Principal Amount
of such Noteholder's Notes of such series; (d) each tranche of Notes under the
Indenture will be deemed to be a separate Class of Investor Certificates and the
Holder of a Note of such class or tranche will be deemed to be the Holder of an
aggregate unpaid principal amount of such Class of Investor Certificates equal
to the Adjusted Outstanding Dollar Principal Amount of such Noteholder's Notes
of such class or tranche and (e) any Notes owned by the MBNA Credit Card Master
Note Trust, the Seller, the Servicer, any other holder of the Seller Interest or
any Affiliate thereof will be deemed not to be outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
consent or direction, only Notes which the Trustee knows to be so owned shall be
so disregarded. Notes so owned which have been pledged in good faith shall not
be disregarded and may be regarded as outstanding if the pledgee establishes to
the satisfaction of the Trustee the pledgee's right so to act with respect to
such Notes and that the pledgee is not the Seller, the Servicer, any other
holder of the Seller Interest or any Affiliate thereof.
SECTION 19. Transfer of the Series 2001-__ Certificate. The Series
------------------------------------------
2001-__ Certificate may not be sold, participated, transferred, assigned,
exchanged or otherwise pledged or conveyed in whole or in part except upon the
prior delivery to the Master Trust Trustee and the Owner Trustee a Master Trust
Tax Opinion and an Issuer Tax Opinion, respectively, with respect thereto.
23
IN WITNESS WHEREOF, the Seller, the Servicer and the Trustee have
caused this Series 2001-__ Supplement to be duly executed by their respective
officers as of the day and year first above written.
MBNA AMERICA BANK,
NATIONAL ASSOCIATION,
Seller and Servicer
By:_______________________________
Name:
Title:
THE BANK OF NEW YORK,
Trustee
By:_______________________________
Name:
Title:
[Signature Page to Series 2001-__ Supplement
dated as of ______ __, 2001]
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