EXECUTION COPY
SERIES 1997-2 SUPPLEMENT dated as of March
1, 1997 (the "Supplement"), among FIRST DEPOSIT
NATIONAL BANK, a national banking association,
Seller and Servicer; PROVIDIAN NATIONAL BANK
(formerly known as FIRST DEPOSIT NATIONAL CREDIT
CARD BANK), a national banking association, Seller;
and BANKERS TRUST COMPANY, a New York banking
corporation, Trustee.
Pursuant to the Pooling and Servicing Agreement dated as of
June 1, 1993 (as amended and supplemented by each amendment or supplement
thereto, other than amendments and supplements that apply only to other Series
of Investor Certificates issued thereunder, the "Agreement"), among the
Sellers, the Servicer and the Trustee, the Sellers have created Providian
Master Trust, formerly known as First Deposit Master Trust (the "Trust").
Section 6.03 of the Agreement provides that the Sellers may from time to 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 to be set forth in a Supplement to the
Agreement.
Pursuant to this Supplement, the Sellers and the Trustee
shall create a new Series of Investor Certificates and specify the Principal
Terms thereof.
ARTICLE I
Creation of the Series 1997-2 Certificates
Section 1.01. 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 "Providian Master Trust, Asset Backed Certificates,
Series 1997-2." Series 1997-2 shall consist of three Classes of Investor
Certificates, the first of which shall be in certificated form and shall be
known as "Providian Master Trust, Floating Rate Class A Asset-Backed
Certificates, Series 1997-2" (the "Class A Certificates"), the second of which
shall be in certificated form and shall be known as "Providian Master Trust,
Floating Rate Class B Asset Backed Certificates, Series 1997-2" (the "Class B
Certificates") and the third of which shall be in
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uncertificated form and shall be known as "Providian Master Trust, Collateral
Interest, Series 1997-2" (the "Collateral Interest"). In connection with the
issuance of the Collateral Interest, the Trustee is hereby directed to enter
into the Collateral Agreement.
(b) Series 1997-2 shall be included in Group One.
Notwithstanding any other provision to the contrary in the Agreement or in this
Supplement, the first Distribution Date with respect to Series 1997-2 shall be
the April 1997 Distribution Date.
(c) The Class A Certificates and the Class B Certificates are
"Investor Certificates" and the Class A Certificateholders and the Class B
Certificateholders are "Investor Certificateholders" for all purposes under the
Agreement and this Supplement. The Collateral Interest shall be deemed to be an
"Investor Certificate" and the Collateral Interest Holder shall be deemed to be
an "Investor Certificateholder" for all purposes under the Agreement and this
Supplement, except where expressly stated to the contrary. The Class A
Certificates, the Class B Certificates and the Collateral Interest together
shall constitute the "Certificateholders' Interest" with respect to Series
1997-2 for all purposes under the Agreement and this Supplement.
(d) In the event that any term or provision contained herein
or in the Collateral Agreement shall conflict with or be inconsistent with any
term or provision contained in the Agreement, the terms and provisions of this
Supplement or the Collateral Agreement, as the case may be, shall govern.
(e) The Collateral Interest Holder, 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 the Agreement relating to the
registration, authentication, delivery, presentation, cancellation and
surrender of Registered Certificates contained in Article VI and Article XII of
the Agreement shall not be applicable to the Collateral Interest.
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ARTICLE II
Definitions
Section 2.01. 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 to the masculine as well as to the feminine and
neuter genders of such terms.
"Adjusted Invested Amount" shall mean, with respect to any
date of determination, an amount equal to the sum of the Class A Adjusted
Invested Amount, the Class B Adjusted Invested Amount and the Collateral
Invested Amount.
"Available Cash Collateral Amount" shall mean, with respect
to any Distribution Date, the lesser of (a) the amount on deposit in the Cash
Collateral Account on such date (before giving effect to any deposit to, or
withdrawal from, the Cash Collateral Account to be made with respect to such
date) and (b) the Required Cash Collateral Amount as of such Distribution Date.
"Available Expected Principal" for any date of determination
with respect to each Monthly Period shall be equal to the excess of (a) the
Expected Monthly Principal for such Monthly Period over (b) the sum of, without
duplication, (i) all scheduled amortizations or accumulations of principal,
including past due shortfalls as of such date of determination, for all
Non-Variable Accumulation Series that are not scheduled to be in their
revolving periods as of such Monthly Period and (ii) all Expected Monthly
Principal collections projected by the Servicer to be allocable to any other
Series with respect to which a Pay Out Event shall have occurred on or prior to
such date of determination.
"Available Finance Charge Collections" shall mean, with
respect to any Distribution Date, an amount equal to the sum of (a) the product
of the Floating Allocation Percentage and the amount of Collections of Finance
Charge Receivables with respect to the related Monthly Period (including any
investment earnings and certain other amounts that are to be treated as
Collections of Finance Charge Receivables in accordance with the Agreement, but
excluding any investment earnings constituting Principal Funding
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Investment Proceeds or Cash Collateral Investment Proceeds), (b) the Principal
Funding Investment Proceeds, if any, with respect to such Distribution Date,
(c) the Cash Collateral Investment Proceeds, if any, with respect to such
Distribution Date, (d) if the Reserve Account is funded, the amount, if any,
withdrawn from the Reserve Account that, pursuant to Section 4.09(d), is
required to be included in Available Finance Charge Collections with respect to
such Distribution Date, (e) any Additional Finance Charges from other Series in
Group One that are allocated to Series 1997-2 with respect to such Monthly
Period in accordance with Section 4.05 of the Agreement and Section 4.07 hereof
and (f) payments on deposit in the Collection Account as of the related
Determination Date received by the Trust from the Interest Rate Protection
Provider with respect to any Interest Rate Protection Agreements.
"Available Principal Collections" shall mean, with respect to
any Distribution Date, an amount equal to (a) the sum of (i) an aggregate
amount equal to the sum for each day in the related Monthly Period of the
product obtained by multiplying the Principal Allocation Percentage with
respect to such day and the amount of such day's Collections of Principal
Receivables, (ii) any Shared Principal Collections with respect to other Series
that are allocated to Series 1997-2 in accordance with Section 4.04 of the
Agreement and Section 4.08 hereof with respect to such Monthly Period and (iii)
any other amounts that, pursuant to Section 4.05 hereof, are to be treated as
Available Principal Collections with respect to such Distribution Date, minus
(b) Reallocated Principal Collections with respect to such Monthly Period.
"Available Reserve Account Amount" shall mean, with respect
to any Distribution Date, the lesser of (a) the amount on deposit in the
Reserve Account on such date (before giving effect to any deposit to be made to
the Reserve Account on such date) and (b) the Required Reserve Account Amount.
"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 Monthly Interest and the Monthly Servicing Fee based on
an assumed Servicing Fee Rate of 2% per annum, in each case with respect to the
related Distribution Date, and the
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denominator of which is the Invested Amount as of the last day of the
immediately preceding Monthly Period.
"Cash Collateral Account" shall have the meaning specified in
Section 4.10(a).
"Cash Collateral Account Investments" shall mean Eligible
Investments.
"Cash Collateral Account Surplus Amount" shall mean, with
respect to any Distribution Date, the amount, if any, by which the Available
Cash Collateral Amount exceeds the Required Cash Collateral Amount after giving
effect to all deposits to and withdrawals from the Cash Collateral Account
required to be made with respect to such Distribution Date.
"Cash Collateral Investment Proceeds" shall have the meaning
specified in Section 4.10(b).
"Class A Accumulation Period" shall mean, unless a Pay Out
Event shall have occurred prior thereto, the period commencing at the close of
business on the last Business Day of February 2002 (or such later date as is
determined in accordance with Section 4.03(e)), and ending upon the first to
occur of (a) the commencement of the Early Amortization Period, (b) the last
Business Day of the Monthly Period immediately preceding the Distribution Date
on which the Class A Invested Amount is paid in full to Class A
Certificateholders and (c) the Termination Date.
"Class A Accumulation Period Amount" shall mean for each
Monthly Period an amount equal to the product of (i) Available Expected
Principal for such Monthly Period and (ii) a fraction, the numerator of which
is the Initial Invested Amount and the denominator of which is the sum of the
Initial Invested Amount and the Initial Invested Amounts (as defined in the
respective related Supplements) of all other Variable Accumulation Series that
are not scheduled to be in their revolving periods as of such Monthly Period;
provided that, for purposes of this definition, the commencement date of the
accumulation period of each such Variable Accumulation Series shall be deemed
to have been postponed to the latest permissible date, determined as if the
provisions of Section 4.03(e) applied to each such Series with such changes as
may be specified in the applicable Supplement with respect to such Series
(applying
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such provisions first to the Variable Accumulation Series with the latest
expected final payment date and next to each Series with the next preceding
expected final payment date).
"Class A Accumulation Period Length" shall have the meaning
specified in Section 4.03(e).
"Class A Additional Interest" shall have the meaning specified
in Section 4.02(a).
"Class A Adjusted Invested Amount" shall mean, with respect
to any date of determination, an amount equal to the excess, if any, of the
Class A Invested Amount over the Principal Funding Account Balance, if any,
with respect to the Class A Certificates on such date.
"Class A Certificate" shall mean any one of the Class of
Investor Certificates designated as "Providian Master Trust, Floating Rate
Class A Asset-Backed Certificates, Series 1997-2" pursuant to Section 1.01(a),
executed by the Banks and authenticated by or on behalf of the Trustee,
substantially in the form of Exhibit A-1.
"Class A Certificate Rate" shall mean, with respect to any
Interest Period, a per annum rate equal to LIBOR as of the related LIBOR
Determination Date, plus 0.11%.
"Class A Certificateholder" shall mean the Person in whose
name a Class A Certificate is registered in the Certificate Register.
"Class A Certificateholders' Interest" shall mean that
portion of the Series 1997-2 Certificateholders' Interest evidenced by the
Class A Certificates.
"Class A Charge-Off" shall have the meaning specified in
Section 4.06(b).
"Class A Controlled Accumulation Amount" shall mean, for any
Distribution Date with respect to the Class A Accumulation Period, $23,770,883;
provided that, if the commencement of the Class A Accumulation Period is
modified pursuant to Section 4.03(e), (a) the Class A Controlled Accumulation
Amount shall mean the amount specified in accordance with such Section on the
date on which the
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Class A Accumulation Period has most recently been modified, (b) the Class A
Controlled Accumulation Amount for each Monthly Period shall be no greater than
the Class A Accumulation Period Amount for such Monthly Period and (c) the sum
of the Class A Controlled Accumulation Amounts for all Monthly Periods
occurring during the modified Class A Accumulation Period shall not be less
than the Class A Initial Invested Amount.
"Class A Controlled Deposit Amount" shall mean, for any
Distribution Date with respect to the Class A Accumulation Period, an amount
equal to the sum of the Class A Controlled Accumulation Amount for such
Distribution Date and any Class A Deficit Controlled Accumulation Amount for
the immediately preceding Distribution Date.
"Class A Defaulted Amount" shall mean, with respect to any
Distribution Date, an amount equal to the product of (a) the Series 1997-2
Defaulted Amount for the related Monthly Period and (b) the Class A Percentage
for such Monthly Period.
"Class A Deficit Controlled Accumulation Amount" shall mean
(a) on the first Distribution Date with respect to the Class A Accumulation
Period, the excess, if any, of the Class A Controlled Accumulation Amount for
such Distribution Date over the amount deposited in the Principal Funding
Account as Class A Monthly Principal for such Distribution Date and (b) on each
subsequent Distribution Date with respect to the Class A Accumulation Period,
the excess, if any, of the Class A Controlled Accumulation Amount for such
subsequent Distribution Date, plus any Class A Deficit Controlled Accumulation
Amount for the prior Distribution Date, over the amount deposited in the
Principal Funding Account as Class A Monthly Principal for such subsequent
Distribution Date.
"Class A Expected Final Payment Date" shall mean the March
2004 Distribution Date.
"Class A Initial Invested Amount" shall mean the aggregate
initial principal amount of the Class A Certificates, which is $570,500,000.
"Class A Interest Shortfall" shall have the meaning specified
in Section 4.02(a).
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"Class A Invested Amount" shall mean, with respect to any
date of determination, an amount equal to (a) the Class A Initial Invested
Amount, minus (b) the aggregate amount of principal payments made to Class A
Certificateholders prior to such date, minus (c) the excess, if any, of the
aggregate amount of Class A Charge-Offs over the aggregate amount of Class A
Charge-Offs reimbursed pursuant to Section 4.05(a)(v) prior to such date;
provided, however, that the Class A Invested Amount shall not be reduced below
zero.
"Class A Monthly Interest" shall have the meaning specified in
Section 4.02(a).
"Class A Monthly Principal" shall have the meaning specified
in Section 4.03(a).
"Class A 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 A Adjusted Invested Amount as
of the last day of the immediately preceding Monthly Period (or, in the case of
the first Monthly Period, as of the Closing Date) and the denominator of which
is the Adjusted Invested Amount as of the last day of such immediately
preceding Monthly Period (or, in the case of the first Monthly Period, as of
the Closing Date).
"Class B Accumulation Period" shall mean, unless a Pay Out
Event shall have occurred prior thereto, the period commencing at the close of
business on the last Business Day of the Monthly Period immediately preceding
the Class A Expected Final Payment Date or, if the Class A Invested Amount is
not paid in full on the Class A Expected Final Payment Date, at the close of
business on the last business day of the second Monthly Period preceding the
Distribution Date on which the Class A Invested Amount is paid in full and
ending upon the first to occur of (a) the commencement of the Early
Amortization Period, (b) the payment in full to Class B Certificateholders of
the Class B Invested Amount and (c) the Termination Date.
"Class B Additional Interest" shall have the meaning specified
in Section 4.02(b).
"Class B Adjusted Invested Amount" shall mean, with respect to
any date of determination, an amount equal
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to the Class B Invested Amount less the Principal Funding Account Balance, if
any, with respect to the Class B Certificates on such date.
"Class B Certificate" shall mean any one of the Class of
Investor Certificates designated as "Providian Master Trust, Floating Rate
Class B Asset-Backed Certificates, Series 1997-2" pursuant to Section 1.01(a),
executed by the Banks and authenticated by or on behalf of the Trustee,
substantially in the form of Exhibit A-2.
"Class B Certificate Rate" shall mean, with respect to any
Interest Period, a per annum rate equal to LIBOR as of the related LIBOR
Determination Date, plus 0.31%.
"Class B Certificateholder" shall mean the Person in whose
name a Class B Certificate is registered in the Certificate Register.
"Class B Certificateholders' Interest" shall mean that
portion of the Series 1997-2 Certificateholders' Interest evidenced by the
Class B Certificates.
"Class B Charge-Off" shall have the meaning specified in
Section 4.06(c).
"Class B Controlled Accumulation Amount" shall mean, for any
Distribution Date with respect to the Class B Accumulation Period, $33,250,000,
or such other amount as the Servicer may determine upon written notice to the
Trustee prior to the commencement of the Class B Accumulation Period; provided,
however, that Class B Controlled Accumulation Amount for each Distribution Date
with respect to the Class B Accumulation Period (on or prior to the Class B
Expected Final Payment Date) will be an amount determined by the Servicer such
that the sum of the Class B Controlled Accumulation Amounts for all such
Distribution Dates will not be less than the Class B Initial Invested Amount.
"Class B Controlled Deposit Amount" shall mean, for any
Distribution Date with respect to the Class B Accumulation Period, an amount
equal to the sum of the Class B Controlled Accumulation Amount for such
Distribution Date and any Class B Deficit Controlled Accumulation Amount for
the immediately preceding Distribution Date.
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"Class B Defaulted Amount" shall mean, with respect to any
Distribution Date, an amount equal to the product of (a) the Series 1997-2
Defaulted Amount for the related Monthly Period and (b) the Class B Percentage
for such Monthly Period.
"Class B Deficit Controlled Accumulation Amount" shall mean
(a) on the first Distribution Date with respect to the Class B Accumulation
Period, the excess, if any, of the Class B Controlled Accumulation Amount for
such Distribution Date over the amount deposited in the Principal Funding
Account as Class B Monthly Principal for such Distribution Date and (b) on each
subsequent Distribution Date with respect to the Class B Accumulation Period,
the excess, if any, of the Class B Controlled Accumulation Amount for such
subsequent Distribution Date, plus any Class B Deficit Controlled Accumulation
Amount for the prior Distribution Date, over the amount deposited in the
Principal Funding Account as Class B Monthly Principal for such subsequent
Distribution Date.
"Class B Expected Final Payment Date" shall mean the May 2004
Distribution Date.
"Class B Initial Invested Amount" shall mean the aggregate
initial principal amount of the Class B Certificates, which is $66,500,000.
"Class B Interest Shortfall" shall have the meaning specified
in Section 4.02(b).
"Class B Invested Amount" shall mean, with respect to any date
of determination, an amount equal to (a) the Class B Initial Invested Amount,
minus (b) the aggregate amount of principal payments made to Class B
Certificateholders prior to such date, minus (c) the aggregate amount by which
the Class B Invested Amount has been reduced in respect of the application of
Reallocated Class B Principal Collections on all prior Distribution Dates
pursuant to Section 4.05(c), minus (d) the aggregate amount of Class B
Charge-Offs prior to such date, plus (e) the aggregate amount of Available
Finance Charge Collections applied on all prior Distribution Dates pursuant to
Section 4.05(a)(viii) for the purpose of reimbursing amounts deducted pursuant
to the foregoing clauses (c) and (d); provided, however, that the Class B
Invested Amount shall not be reduced below zero.
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"Class B Monthly Interest" shall have the meaning specified in
Section 4.02(b).
"Class B Monthly Principal" shall have the meaning specified
in Section 4.03(b).
"Class B 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 B Adjusted Invested Amount as
of the last day of the immediately preceding Monthly Period (or, in the case of
the first Monthly Period, as of the Closing Date) and the denominator of which
is the Adjusted Invested Amount as of the last day of such immediately
preceding Monthly Period (or, in the case of the first Monthly Period, as of
the Closing Date).
"Class B Principal Commencement Date" shall mean the
Distribution Date on which the Class A Invested Amount is paid in full or, if
the Class A Invested Amount is paid in full on the Class A Expected Final
Payment Date and the Early Amortization Period has not commenced, the
Distribution Date following the Class A Expected Final Payment Date.
"Class B Subordinated Additional Interest" shall have the
meaning specified in Section 4.02(c).
"Class B Subordinated Interest Shortfall" shall have the
meaning specified in Section 4.02(c).
"Class B Subordinated Monthly Interest" shall have the meaning
specified in Section 4.02(c).
"Closing Date" shall mean March 20, 1997.
"Collateral Agreement" shall mean the loan agreement relating
to Series 1997-2 among the Sellers, the Servicer, the Trustee, the CIA
Investors parties thereto from time to time and the Agent thereunder, dated as
of the date hereof, as amended, supplemented or modified from time to time.
"Collateral Defaulted Amount" shall mean, with respect to each
Distribution Date, an amount equal to the product of (a) the Series 1997-2
Defaulted Amount for the
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related Monthly Period and (b) the Collateral Percentage for such Monthly
Period.
"Collateral Initial Invested Amount" shall mean the aggregate
initial principal amount of the Collateral Interest, which is $63,000,000.
"Collateral Interest" shall mean the Class of Investor
Certificates designated as "Providian Master Trust, Collateral Interest, Series
1997-2" pursuant to Section 1.01(a), according to the terms specified in the
Collateral Agreement.
"Collateral Interest Holder" shall mean the entity or entities
so designated in the Collateral Agreement.
"Collateral Interest Rate" shall mean the rate designated as
such in the Collateral Agreement; provided, however, that the Collateral
Interest Rate with respect to any Monthly Period shall not exceed LIBOR for
such Monthly Period plus 1%.
"Collateral Invested Amount" shall mean, with respect to any
date of determination, an amount equal to (a) the Collateral Initial Invested
Amount minus (b) the aggregate amount of principal payments made to the
Collateral Interest Holder prior to such date and applied to the Collateral
Invested Amount in accordance with the terms of the Collateral Agreement, minus
(c) the aggregate amount by which the Collateral Invested Amount has been
reduced in respect of the application of Reallocated Principal Collections on
all prior Distribution Dates pursuant to Sections 4.05(b) and (c), minus (d)
the aggregate amount by which the Collateral Invested Amount has been reduced
on all prior Distribution Dates pursuant to Section 4.06, plus (e) the
aggregate amount of Available Finance Charge Collections applied on all prior
Distribution Dates pursuant to Section 4.05(a)(xii) for the purpose of
reimbursing amounts deducted pursuant to the foregoing clauses (c) and (d);
provided, however, that the Collateral Invested Amount shall not be reduced
below zero.
"Collateral Monthly Interest" shall have the meaning specified
in Section 4.02(d).
"Collateral Monthly Principal" shall have the meaning
specified in Section 4.03(f).
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"Collateral Percentage" shall mean, with respect to any
Monthly Period, 100% minus the sum of the Class A Percentage and the Class B
Percentage.
"Covered Amount" shall mean, for any Distribution Date with
respect to the Class A Accumulation Period or the first Special Payment Date
(on or prior to the Class A Expected Final Payment Date), an amount equal to
the product of (a) a fraction, the numerator of which is the actual number of
days in the related Interest Period and the denominator of which is 360, (b)
the Class A Certificate Rate for such Interest Period and (c) the Principal
Funding Account Balance, if any, with respect to the Class A Certificates as of
the preceding Distribution Date.
"Cut-Off Date" shall mean February 28, 1997.
"Early Amortization Period" shall mean the period beginning
at the close of business on the Business Day immediately preceding the day on
which a Pay Out Event with respect to Series 1997-2 is deemed to have occurred,
and ending upon the earlier to occur of (a) the payment in full to the Series
1997-2 Certificateholders of the Invested Amount and (b) the Termination Date.
"Expected Monthly Principal" shall be equal to the product of
(a) the lowest of the monthly principal payment rates (determined by dividing
Collections of Principal Receivables during a calendar month by the amount of
Principal Receivables in the Trust as of the last day of the preceding month,
adjusted for additions and removals occurring after such last day), expressed
as a decimal, for the 12 calendar months preceding the date of such calculation
(or such lower principal payment rate as the Servicer may select) and (b) the
sum of the Initial Invested Amounts (as defined in the respective related
Supplements) of all outstanding Series, other than any Variable Funding Series.
"Finance Charge Shortfall" shall have the meaning specified in
Section 4.07.
"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 Adjusted Invested
Amount as of the last day of the immediately preceding Monthly Period and
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the denominator of which is the sum of the Principal Receivables in the Trust
and the amount on deposit in the Special Funding Account as of the last day of
such immediately preceding Monthly Period; provided, however, that, with
respect to the first Monthly Period, the Floating Allocation Percentage shall
mean the percentage equivalent of a fraction, the numerator of which is the
Initial Invested Amount for the period from and including the Closing Date to
and including the last day of such Monthly Period and the denominator of which
is the sum of the Principal Receivables in the Trust and the amount on deposit
in the Special Funding Account as of the Cut-Off Date.
"Group One" shall mean Series 1997-2 and each other Series
specified in the Supplement for that Series to be included in Group One.
"Initial Invested Amount" shall mean an amount equal to the
sum of the Class A Initial Invested Amount, the Class B Initial Invested Amount
and the Collateral Initial Invested Amount.
"Interest Period" shall mean, with respect to any
Distribution Date, the period from and including the preceding Distribution
Date to but excluding such Distribution Date; provided, however, that the
initial Interest Period shall commence on and include the Closing Date and end
on but exclude the first Distribution Date.
"Interest Rate Protection Agreement" shall mean, if
applicable, any interest rate cap agreement, interest rate swap agreement or any
other interest rate protection agreement assigned to the Trust for the benefit
of the Series 1997-2 Certificateholders and any guarantee thereof.
"Interest Rate Protection Provider" shall mean, if applicable,
the Person specified in the Interest Rate Protection Agreement, in its capacity
as obligor thereunder, and any Person acting as guarantor of the Interest Rate
Protection Agreement.
"Invested Amount" shall mean, with respect to any date of
determination, an amount equal to the sum of the Class A Invested Amount, the
Class B Invested Amount and the Collateral Invested Amount on such date.
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"LIBOR" shall mean, with respect to each day of each Interest
Period (or portion thereof), the rate per annum shown on page 3750 of the Dow
Xxxxx & Company Telerate screen or any successor page as the rate for United
States Dollar deposits for a period of one month as of 11:00 a.m., London time,
on the LIBOR Determination Date for such Interest Period; provided, however,
that if no such rate is shown, LIBOR shall be the rate per annum (rounded
upwards, if necessary, to the nearest one-sixteenth of one percent) based on the
offered rates for United States Dollar deposits for a period of one month as
displayed on page "LIBO" of the Reuters Monitor Money Rates Service or any
successor page as of 11:00 a.m., London time, on the LIBOR Determination Date
for such Interest Period, it being understood that if at least two such rates
appear on such page, the rate shall be the arithmetic mean of such displayed
rates; and provided further, that (i) if fewer than two such rates are
displayed, LIBOR shall be the rate per annum (rounded upwards, if necessary, to
the nearest one-sixteenth of one percent) equal to the arithmetic mean of the
rates at which deposits in United States Dollars are offered by the Reference
Banks at approximately 11:00 a.m., London time, on the LIBOR Determination Date
for such Interest Period to prime banks in the London interbank market for a
period of one month and (ii) if fewer than two such rates are provided as
requested, LIBOR shall be the rate per annum (rounded upwards, if necessary, to
the nearest one-sixteenth of one percent) equal to the arithmetic mean of the
rates quoted by two or more major banks in New York City, selected by the
Servicer, at approximately 11:00 a.m., New York City time, on the LIBOR
Determination Date for such Interest Period to leading European banks for United
States Dollar deposits for a period of one month. If fewer than two major banks
in New York City are quoting rates for such deposits at such time, the rate for
that day shall be deemed to be the rate as determined with respect to the
preceding Interest Period.
"LIBOR Determination Date" shall mean, with respect to any
Interest Period, the second London Business Day prior to the commencement of
such Interest Period.
"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" shall mean, with respect to any
Distribution Date, an amount equal to the sum of the Class A
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Monthly Interest, the Class B Monthly Interest and the Collateral Monthly
Interest with respect to such Distribution Date.
"Monthly Servicing Fee" shall have the meaning specified in
Section 3.01.
"Non-Variable Accumulation Series" shall mean Series 1993-2
and each outstanding Series that is not a Variable Funding Series or a Variable
Accumulation Series.
"Payment Date" shall mean any Distribution Date and any
Special Payment Date.
"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 investment earnings and certain other amounts that are to
be treated as Collections of Finance Charge Receivables in accordance with the
Agreement but excluding any investment earnings constituting Cash Collateral
Investment Proceeds or Principal Funding Investment Proceeds), calculated on a
cash basis, plus (b) any Additional Finance Charges from other Series in Group
One that are allocated to Series 1997-2 with respect to such Monthly Period in
accordance with Section 4.05 of the Agreement and Section 4.07 hereof,
calculated on a cash basis, plus (c) the amount of Cash Collateral Investment
Proceeds, if any, for the Distribution Date with respect to such Monthly Period,
plus (d) the amount of Principal Funding Investment Proceeds, if any, for the
Distribution Date with respect to such Monthly Period, plus (e) if the Reserve
Account is funded, the amount, if any, withdrawn from the Reserve Account that,
pursuant to Section 4.09(d), is required to be included as Available Finance
Charge Collections for the Distribution Date with respect to such Monthly
Period, minus (f) the Series 1997-2 Defaulted Amount for the Distribution Date
with respect to such Monthly Period, and the denominator of which is the
Invested Amount as of the last day of the immediately preceding Monthly Period.
"Principal Allocation Percentage" shall mean, with
respect to any date of determination during a Monthly
17
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is (i) during the Revolving Period, the
Invested Amount as of the last day of the immediately preceding Monthly Period
and (ii) during the Class A Accumulation Period, the Class B Accumulation Period
or the Early Amortization Period, the Invested Amount as of the last day of the
Revolving Period and the denominator of which is the greater of (a) the sum of
the Principal Receivables in the Trust and the amount on deposit in the Special
Funding Account as of the last day of such immediately preceding Monthly Period
and (b) the sum of the numerators used to calculate the principal allocation
percentages for all Series outstanding as of such date of determination.
"Principal Funding Account" shall have the meaning specified
in Section 4.03(c)(i).
"Principal Funding Account Balance" shall mean, with respect
to any date of determination, the principal amount, if any, on deposit in the
Principal Funding Account on such date (after giving effect to any deposits to,
or withdrawals from, the Principal Funding Account before or on such date).
"Principal Funding Investment Proceeds" shall have the meaning
specified in Section 4.03(c)(ii).
"Principal Shortfall" shall have the meaning specified in
Section 4.08.
"Reallocated Class B Principal Collections" shall mean, with
respect to any Monthly Period, the lesser of (a) an amount equal to the excess,
if any, of the full amount required to be paid pursuant to Sections 4.05(a)(i),
(iii) and (iv) over the amount of the Available Finance Charge Collections,
Available Cash Collateral Amount and Reallocated Collateral Principal
Collections applied with respect thereto for such Monthly Period and (b) the sum
for each day of the related Monthly Period of the product obtained by
multiplying (i) the Principal Allocation Percentage with respect to such day,
(ii) the amount of such day's Collections of Principal Receivables and (iii) the
Class B Percentage as of the last day of the immediately preceding Monthly
Period.
18
"Reallocated Collateral Principal Collections" shall mean,
with respect to any Monthly Period, the lesser of (a) an amount equal to the
excess, if any, of the Required Amount over the Available Cash Collateral Amount
applied with respect thereto for such Monthly Period and (b) the sum for each
day of the related Monthly Period of the product obtained by multiplying (i) the
Principal Allocation Percentage with respect to such day, (ii) the amount of
such day's Collections of Principal Receivables and (iii) the Collateral
Percentage as of the last day of the immediately preceding Monthly Period.
"Reallocated Principal Collections" shall mean, with respect
to any Monthly Period, the sum of (a) Reallocated Class B Principal Collections
with respect to such Monthly Period and (b) Reallocated Collateral Principal
Collections 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 (a) the Adjusted
Invested Amount on such Distribution Date, plus (b) Monthly Interest for such
Distribution Date and any Monthly Interest previously due but not distributed to
the Series 1997-2 Certificateholders on any prior Distribution Date, plus (c)
the amount of Class A Additional Interest and Class B Additional Interest, if
any, for such Distribution Date and any Class A Additional Interest and Class B
Additional Interest previously due but not distributed to the Class A
Certificateholders and the Class B Certificateholders on any prior Distribution
Date, plus (d) Class B Subordinated Monthly Interest for such Distribution Date
and any Class B Subordinated Monthly Interest previously due but not distributed
to the Class B Certificateholders on any prior Distribution Date, plus (e) the
amount of Class B Subordinated Additional Interest, if any, for such
Distribution Date and any Class B Subordinated Additional Interest previously
due but not distributed to the Class B Certificateholders on any prior
Distribution Date.
"Reference Banks" shall mean two or more major banks in the
London interbank market selected by the Servicer.
"Required Amount" shall have the meaning specified in Section
4.04.
19
"Required Cash Collateral Amount" shall mean $21,000,000.
"Required Collateral Invested Amount" shall mean the excess,
if any, of (a) the Required Enhancement Amount over (b) the Required Cash
Collateral Amount.
"Required Enhancement Amount" shall mean with respect to any
Distribution Date, 12% of the Adjusted Invested Amount on such Distribution Date
after taking into account any adjustments to the Adjusted Invested Amount on
such Distribution Date, but not less than $21,000,000; provided, however, that
(i) if a Pay Out Event with respect to Series 1997-2 has occurred, the Required
Enhancement Amount for any Distribution Date shall equal the Required
Enhancement Amount for the Distribution Date immediately preceding such Pay Out
Event, (ii) in no event shall the Required Enhancement Amount exceed the
outstanding principal amount of the Class A Certificates and the Class B
Certificates, as of the last day of the Monthly Period preceding such
Distribution Date after taking into account the payments to be made on such
Distribution Date and (iii) the Required Enhancement Amount may be reduced, at
the Sellers' option at any time, to a lesser amount if prior written notice of
such reduction is given to the Collateral Interest Holder and the Sellers, the
Servicer and the Trustee have been provided evidence that the Rating Agency
Condition shall have been satisfied.
"Required Reserve Account Amount" if applicable, 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, a percentage selected by
the Servicer upon written notice to the Trustee (not to exceed 0.50% of the
Class A Invested Amount as of such Distribution Date (after giving effect to all
changes therein on such date).
"Reserve Account" if applicable, shall have the meaning
specified in Section 4.09(a).
"Reserve Account Funding Date" if applicable, shall be
selected by the Servicer and shall mean the Distribution Date with respect to
the Monthly Period that
20
commences no more than 12 months prior to the Monthly Period that commences the
Class A Accumulation Period.
"Reserve Account Surplus" shall mean, if applicable, 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" if applicable, shall have the meaning
specified in Section 4.09(c).
"Revolving Period" shall mean the period beginning at the
close of business on the Cut-Off Date and ending on the earlier of (a) the
close of business on the day the Class A Accumulation Period commences and (b)
the close of business on the day the Early Amortization Period commences.
"Series 1997-2" shall mean the Series of Investor
Certificates the terms of which are specified in this Supplement, including the
Class consisting of the Class A Certificates, the Class consisting of the Class
B Certificates and the Class consisting of the Collateral Interest.
"Series 1997-2 Certificate" shall mean any one of the Class A
Certificates, the Class B Certificates, or the Collateral Interest.
"Series 1997-2 Certificateholder" shall mean any one of the
Class A Certificateholders, the Class B Certificateholders or the Collateral
Interest Holder.
"Series 1997-2 Certificateholders' Interest" shall mean that
portion of the Certificateholders' Interest evidenced by the Series 1997-2
Certificates.
"Series 1997-2 Defaulted Amount" shall mean, with respect to
each Distribution Date, an amount equal to the product of (i) the Defaulted
Amount for the related Monthly Period and (ii) the Floating Allocation
Percentage for such Monthly Period.
"Servicing Fee Rate" shall mean (a) for such time as FDNB or
any of its Affiliates is the Servicer, 1.75% per annum and (b) at all other
times, a percentage determined by the Trustee in accordance with Section 10.02
of the Agreement which shall not exceed 2.00% per annum.
21
"Special Payment Date" shall mean each Distribution Date with
respect to the Early Amortization Period.
"Termination Date" shall mean the May 2008 Distribution Date.
"Transfer Date Reserve Account Surplus Amount" shall have the
meaning specified in Section 4.09(e).
"United States Dollars or "$" shall mean the lawful currency
of the United States of America.
"Variable Accumulation Series" shall mean each outstanding
Series, other than Series 1993-2 and any Variable Funding Series, for which,
pursuant to the terms of the related Supplement, at the time a determination is
made pursuant to Section 4.03(e), the commencement date of the Accumulation
Period may be changed.
"Variable Funding Series" shall mean Series 1993-3 and any
other Series designated in the related Supplement as a Variable Funding Series.
(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 1997-2, Xxxxx'x and
Standard & Poor's. As used in this Supplement and in the Agreement with respect
to Series 1997-2, "highest investment category" shall mean (i) in the case of
Standard & Poor's, A-1+ or AAA, as applicable, and (ii) in the case of Xxxxx'x,
P-1 or Aaa, as applicable.
(c) All capitalized terms used herein and not otherwise
defined herein have the meanings ascribed to them in the Agreement.
(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".
22
ARTICLE III
Servicer
Section 3.01. Servicing Compensation. The share of the
Servicing Fee allocable to the Series 1997-2 Certificateholders with respect to
any Distribution Date (the "Monthly Servicing Fee") shall be equal to
one-twelfth of the product of (a) the Servicing Fee Rate and (b) (i) the
Adjusted Invested Amount as of the last day of the Monthly Period preceding such
Distribution Date, minus (ii) the product of the amount, if any, on deposit in
the Special Funding Account as of the last day of such Monthly Period and the
Floating Allocation Percentage with respect to such Monthly Period; provided,
however, that with respect to the first Distribution Date, the Monthly Servicing
Fee shall be equal to the product of (x) 1.75%, (y) the Initial Invested Amount
and (z) a fraction, the numerator of which is the actual number of days in the
period from and including the Closing Date to and including the last day of the
Monthly Period immediately preceding the first Distribution Date and the
denominator of which is 360. The remainder of the Servicing Fee (i.e., the
portion not allocated to the Series 1997-2 Certificateholders' Interest) shall
be paid by the Sellers or the Certificateholders of other Series (as provided in
the related Supplements) and in no event shall the Trust, the Trustee or the
Series 1997-2 Certificateholders be liable for the share of the Servicing Fee to
be paid by the Sellers or the Certificateholders of any other Series. The
Monthly Servicing Fee shall be payable to the Servicer solely to the extent
amounts are available for distribution in respect thereof pursuant to Section
4.05(a)(iii) and Sections 4.05(b) and (c).
ARTICLE IV
Rights of Series 1997-2 Certificateholders;
Allocation and Application of Collections
Section 4.01. Collections and Allocations. The Servicer shall
apply, or shall instruct the Trustee, upon written notice substantially in the
form of Exhibit B, to apply, all collections and other funds on deposit in the
Collection Account that are allocated to the Series 1997-2 Certificates as
described in this Article IV.
23
Section 4.02. Determination of Monthly Interest. (a) The
amount of monthly interest ("Class A Monthly Interest") distributable from the
Collection Account with respect to the Class A Certificates on any Distribution
Date shall be an amount equal to the product of (i) a fraction, the numerator of
which is the actual number of days in the related Interest Period and the
denominator of which is 360, (ii) the Class A Certificate Rate and (iii) the
outstanding principal amount of the Class A Certificates as of the immediately
preceding Record Date.
On or before 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. With respect to any Distribution Date, if the Class A
Interest Shortfall with respect to the preceding Distribution Date is greater
than zero, an amount ("Class A Additional Interest") equal to the product of (i)
a fraction, the numerator of which is the actual number of days in the related
Interest Period and the denominator of which is 360, (ii) the Class A
Certificate Rate and (iii) such Class A Interest Shortfall (or the portion
thereof which has not been paid to Class A Certificateholders) shall be payable
as provided herein with respect to the Class A Certificates on each Distribution
Date following the Distribution Date on which such Class A Interest Shortfall
occurs to and including the Distribution Date on which such Class A Interest
Shortfall is paid to 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 any Distribution Date shall be an amount equal to the product of
(i) a fraction, the numerator of which is the actual number of days in the
related Interest Period and the denominator of which is 360, (ii) the Class B
Certificate Rate and (iii) the Class B Invested Amount as of the immediately
preceding Record Date.
On or before each Distribution Date, the Servicer shall
determine the excess, if any (the "Class B Interest
24
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. With respect to any
Distribution Date, if the Class B Interest Shortfall with respect to the
preceding Distribution Date is greater than zero, an amount ("Class B
Additional Interest") equal to the product of (i) a fraction, the numerator of
which is the actual number of days in the related Interest Period and the
denominator of which is 360, (ii) the Class B Certificate Rate and (iii) such
Class B Interest Shortfall (or the portion thereof which has not been paid to
Class B Certificateholders) shall be payable as provided herein with respect to
the Class B Certificates on each Distribution Date following the Distribution
Date on which such Class B Interest Shortfall occurs to and including the
Distribution Date on which such Class B Interest Shortfall is paid to 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.
(c) The amount of subordinated monthly interest ("Class B
Subordinated Monthly Interest") distributable from the Collection Account with
respect to the Class B Certificates on any Distribution Date shall be an amount
equal to the excess, if any, of (x) an amount equal to the product of (i) a
fraction, the numerator of which is the actual number of days in the related
Interest Period and the denominator of which is 360, (ii) the Class B
Certificate Rate and (iii) the outstanding principal amount of the Class B
Certificates as of the immediately preceding Record Date over (y) the Class B
Monthly Interest for such Distribution Date.
On or before each Distribution Date, the Servicer shall
determine the excess, if any (the "Class B Subordinated Interest Shortfall"), of
(x) the Class B Subordinated Monthly Interest for such Distribution Date over
(y) the aggregate amount of funds allocated and available to pay such Class B
Subordinated Monthly Interest on such Distribution Date. With respect to any
Distribution Date, if the Class B Subordinated Interest Shortfall with respect
to the preceding Distribution Date is greater than zero, an amount ("Class B
Subordinated Additional Interest") equal to the product of (i) a fraction, the
numerator of which is the actual number of days in the related Interest
25
Period and the denominator of which is 360, (ii) the Class B Certificate Rate
and (iii) such Class B Subordinated Interest Shortfall (or the portion thereof
which has not been paid to Class B Certificateholders) shall be payable as
provided herein with respect to the Class B Certificates on each Distribution
Date following the Distribution Date on which such Class B Subordinated Interest
Shortfall occurs to and including the Distribution Date on which such Class B
Subordinated Interest Shortfall is paid to Class B Certificateholders.
Notwithstanding anything to the contrary herein, Class B Subordinated Additional
Interest shall be payable or distributed to Class B Certificateholders only to
the extent permitted by applicable law.
(d) The amount of monthly interest ("Collateral Monthly
Interest") distributable from the Collection Account with respect to the
Collateral Interest on any Distribution Date shall be an amount equal to the
product of (i) a fraction, the numerator of which is the actual number of days
in the related Interest Period and the denominator of which is 360, (ii) the
Collateral Interest Rate and (iii) the Collateral Invested Amount as of the last
Business Day of the preceding Monthly Period.
Section 4.03. Determination of Class A Monthly Principal,
Class B Monthly Principal and Collateral Monthly Principal; Principal Funding
Account; Class A Accumulation Period. (a) The amount of monthly principal
("Class A Monthly Principal") distributable from the Collection Account with
respect to the Class A Certificateholders' Interest on each Distribution Date
beginning with the first to occur of (i) the first Special Payment Date, if any,
and (ii) the first Distribution Date with respect to the Class A Accumulation
Period, shall be equal to the least of (x) Available 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 Payment Date, the Class A Controlled
Deposit Amount for such Distribution Date and (z) the Class A Adjusted 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 Certificateholders' Interest on each Distribution Date beginning with the
26
Class B Principal Commencement Date, shall be equal to the least of (x)
Available Principal Collections on deposit in the Collection Account with
respect to such Distribution Date (less the portion of Available 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 Payment Date) provided that the Class A
Invested Amount was paid in full on the Class A Expected Final Payment Date, the
Class B Controlled Deposit Amount for such Distribution Date and (z) the Class B
Adjusted Invested Amount on such Distribution Date.
(c) (i) The Servicer, for the benefit of the Class A
Certificateholders and the Class B 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
Class A Certificateholders and the Class B Certificateholders. The Principal
Funding Account shall initially be established with Bankers Trust Company.
(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 Class A Certificateholders and the
Class B 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 such Eligible Investment in the
Principal Funding Account shall be disposed of prior to its maturity; provided,
however, that the Trustee shall sell, liquidate or dispose of such Eligible
Investment before its maturity, at the written direction of the Servicer, if
such sale, liquidation or disposal would not result in a loss of all or part of
the principal portion of such Eligible Investment (the Trustee shall not be
responsible for determining whether such a loss would result) or if, prior to
the maturity of such Eligible
27
Investment, a default occurs in the payment of principal, interest or any other
amount with respect to such Eligible Investment. Unless the Servicer directs
otherwise, funds deposited in the Principal Funding Account on a Transfer Date
(which immediately precedes a Payment Date) upon the maturity of any Eligible
Investments are not required to be invested overnight.
(iii) On each Distribution Date with respect to the Class A
Accumulation Period and the Class B Accumulation Period and on the first Special
Payment 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
Available Finance Charge Collections for such Distribution Date.
(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.
(d) (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 Class
A Certificateholders and the Class B Certificateholders. If, at any time, the
Principal Funding 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 Principal Funding Account meeting the conditions
specified in paragraph (c)(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
Section 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
28
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 Class A Certificateholders and the Class B
Certificateholders.
(e) The Class A Accumulation Period is scheduled to commence
at the close of business on the last Business Day of February 2002; provided,
however, that if the Class A Accumulation Period Length on any Determination
Date (determined as described below) is less than twenty-four months, upon
notice to the Trustee, the Sellers, each Rating Agency and the Collateral
Interest Holder, the Servicer, at its option, may elect to modify the date on
which the Class A Accumulation Period actually commences to the last Business
Day of any month that precedes the month that is the number of months prior to
the Class A Expected Final Payment Date equal to the Class A Accumulation Period
Length; provided, however, that (i) the length of the Class A Accumulation
Period shall not be less than six months; 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 shall determine the "Class A Accumulation Period Length," which shall
equal the number of months such that the Class A Accumulation Period Amount for
the Monthly Period immediately preceding the Class A Expected Final Payment
Date, when aggregated with the Class A Accumulation Period Amounts for each
preceding Monthly Period, shall equal or exceed the Class A Initial Invested
Amount. Any notice by the Servicer electing to modify the commencement of the
Class A Accumulation Period pursuant to this subsection (e) shall specify (i)
the Class A Accumulation Period Length, (ii) the commencement date of the Class
A Accumulation Period and (iii) the Class A Controlled Accumulation Amount with
respect to each Monthly Period preceding the Class A Expected Final Payment
Date.
(f) The amount, if any, of monthly principal ("Collateral
Monthly Principal") distributable from the
29
Collection Account with respect to the Collateral Interest on each Distribution
Date:
(i) for any Distribution Date prior to the Distribution Date
on which the Class A Invested Amount and the Class B Invested Amount
are paid in full, shall be an amount equal to the lesser of (A)
Available Principal Collections not applied to Class A Monthly
Principal or Class B Monthly Principal on such Distribution Date and
(B) the excess, if any, of (x) the Collateral Invested Amount over (y)
the Required Collateral Invested Amount (after giving effect to any
adjustments made to the Required Collateral Invested Amount on such
Distribution Date); and
(ii) beginning with the Distribution Date on which the Class A
Invested Amount and the Class B Invested Amount are paid in full,
shall be an amount equal to Available Principal Collections with
respect to such Distribution Date (minus the portion of any Available
Principal Collections applied to Class A Monthly Principal or Class B
Monthly Principal on such Distribution Date);
provided, however, that with respect to any Distribution Date, Collateral
Monthly Principal shall not exceed the Collateral Invested Amount.
Section 4.04. Required Amount. With respect to each
Distribution Date, on the related Determination Date, the Servicer shall
determine the amount (the "Required Amount"), if any, by which (i) the full
amount required to be paid pursuant to Sections 4.05(a)(i), (ii), (iii), (iv)
and (vii) for such Distribution Date exceeds (ii) the amount of Available
Finance Charge Collections to be applied thereto for such Distribution Date. The
Servicer shall give the Trustee notice of the Required Amount on any
Determination Date on which the Servicer determines that the Required Amount is
greater than zero.
Section 4.05. Application of Available Finance Charge
Collections and Available Principal Collections. The Servicer shall apply (if
FDNB is the Servicer and the Collection Account is maintained with FDNB) or
shall cause the Trustee to apply, on each Distribution Date, Available Finance
Charge Collections, Reallocated Principal
30
Collections and Available Principal Collections on deposit in the Collection
Account with respect to such Distribution Date, to make the following
distributions:
(a) On each Distribution Date, Available Finance Charge
Collections with respect to such Distribution Date shall 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 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 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 Class B Monthly Interest for such
Distribution Date, plus the amount of any Class B Monthly Interest
previously due but not distributed to Class B 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 Class B
Certificateholders on a prior Distribution Date, shall be distributed
to the Paying Agent for payment to the Class B Certificateholders;
(iii) an amount equal to the Monthly Servicing Fee for such
Distribution Date, plus the amount of any Monthly Servicing Fee
previously due but not distributed to the Servicer on any prior
Distribution Date, shall be distributed to the Servicer (unless such
amount has been netted against deposits to the Collection Account in
accordance with Section 4.03(a) of the Agreement);
(iv) an amount equal to the Class A Defaulted Amount for such
Distribution Date shall be treated as a portion of Available Principal
Collections for such Distribution Date;
(v) an amount equal to the aggregate amount of Class A
Charge-Offs that have not been previously
31
reimbursed shall be treated as a portion of Available Principal
Collections for such Distribution Date;
(vi) an amount equal to Class B Subordinated Monthly Interest
for such Distribution Date, plus the amount of any Class B
Subordinated Monthly Interest previously due but not distributed to
Class B Certificateholders on a prior Distribution Date, plus the
amount of any Class B Subordinated Additional Interest for such
Distribution Date and any Class B Subordinated Additional Interest
previously due but not distributed to Class B Certificateholders on a
prior Distribution Date, shall be distributed to the Paying Agent for
payment to the Class B Certificateholders;
(vii) an amount equal to the Class B Defaulted Amount for such
Distribution Date shall be treated as a portion of Available Principal
Collections for such Distribution Date;
(viii) an amount equal to the aggregate amount by which the
Class B Invested Amount has been reduced pursuant to clauses (c) and
(d) of the definition of "Class B Invested Amount" (but not in excess
of the amount of such reductions that have not been previously
reimbursed) shall be treated as a portion of Available Principal
Collections with respect to such Distribution Date;
(ix) an amount equal to the Collateral Monthly Interest, plus
the amount of any Collateral Monthly Interest previously due but not
paid to the Collateral Interest Holder on any prior Distribution Date,
shall be paid to the Collateral Interest Holder for application in
accordance with the Collateral Agreement;
(x) an amount equal to the Collateral Defaulted Amount for
such Distribution Date shall be treated as a portion of Available
Principal Collections with respect to such Distribution Date;
(xi) if the Reserve Account is being funded, on each
Distribution Date from and after the Reserve Account Funding Date, but
prior to the date on which the Reserve Account terminates as described
in Section 4.09(f), an amount up to the excess, if any, of
32
the Required Reserve Account Amount over the Available Reserve Account
Amount shall be deposited into the Reserve Account;
(xii) an amount equal to the aggregate amount by which the
Collateral Invested Amount has been reduced pursuant to clauses (c)
and (d) of the definition of "Collateral Invested Amount" (but not in
excess of the amount of such reductions that have not been previously
reimbursed) shall be treated as a portion of Available Principal
Collections with respect to such Distribution Date;
(xiii) an amount up to the excess, if any, of the Required
Cash Collateral Amount over the remaining Available Cash Collateral
Amount shall be deposited into the Cash Collateral Account;
(xiv) an amount equal to the aggregate of any other amounts
then due to the Collateral Interest Holder pursuant to the Collateral
Agreement (to the extent such amounts are payable pursuant to the
Collateral Agreement out of "Available Non-Principal Funds" (as defined
therein)) shall be applied in accordance with the Collateral Agreement;
and
(xv) the balance, if any, shall constitute Additional Finance
Charges for such Distribution Date and shall be available for
allocation to other Series in Group One or to the Sellers as described
in Section 4.05 of the Agreement.
(b) On each Distribution Date, Reallocated Collateral
Principal Collections shall be distributed to fund any excess of the Required
Amount over the Available Cash Collateral Amount applied thereto for such
Distribution Date, the amount of such Reallocated Collateral Principal
Collections being applied to the components of the Required Amount in the same
priority as amounts are applied to such components from Available Finance Charge
Collections pursuant to Section 4.05(a), and the Collateral Invested Amount
(after giving effect to reductions in the Collateral Invested Amount on such
Distribution Date pursuant to Section 4.06(a) in respect of the amount by which
the Collateral Defaulted Amount exceeded the amount of Available Finance Charge
Collections available to fund the Collateral
33
Defaulted Amount) shall be reduced by the amount of such Reallocated Collateral
Principal Collections.
(c) On each Distribution Date, Reallocated Class B Principal
Collections shall be distributed to fund any excess of the full amount required
to be paid pursuant to Sections 4.05(a)(i), (iii) and (iv) for such
Distribution Date over the amount of Available Finance Charge Collections, the
Available Cash Collateral Amount and Reallocated Collateral Principal
Collections applied thereto for such Distribution Date, the amount of such
Reallocated Class B Principal Collections being applied to fund any deficiency
pursuant to Sections 4.05(a)(i), (iii) and (iv) in the same priority as amounts
are applied to such Sections from Available Finance Charge Collections pursuant
to Section 4.05(a), and the Collateral Invested Amount (after giving effect to
reductions in the Collateral Invested Amount on such Distribution date (i)
pursuant to Section 4.05(b) in respect of the application of Reallocated
Collateral Principal Collections and (ii) pursuant to Section 4.06(a) in
respect of the amount by which the Collateral Defaulted Amount exceeded the
amount of Available Finance Charge Collections available to fund the Collateral
Defaulted Amount) shall be reduced by the amount of such Reallocated Class B
Principal Collections. In the event that such reduction would cause the
Collateral Invested Amount to be reduced below zero, the Collateral Invested
Amount shall be reduced to zero and the Class B Invested Amount (after giving
effect to reductions in the Class B Invested Amount pursuant to Section 4.06(c)
in respect of the amount by which the Class B Defaulted Amount exceeded the
amount of Available Finance Charge Collections, the Available Cash Collateral
Amount and Reallocated Collateral Principal Collections available to fund the
Class B Defaulted Amount) shall be reduced by the amount by which the
Collateral Invested Amount would have been reduced below zero.
(d) On each Distribution Date with respect to the Revolving
Period, an amount equal to the Available Principal Collections deposited in the
Collection Account for the related Monthly Period shall be distributed in the
following priority:
(i) an amount equal to Collateral Monthly Principal, if any,
for such Distribution Date shall be distributed to the Collateral
Interest Holder for
34
application in accordance with the Collateral Agreement; and
(ii) the balance, if any, of such Available 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.
(e) On each Distribution Date during the period beginning on
the earlier to occur of (w) the first Distribution Date with respect to the
Class A Accumulation Period and (x) the first Special Payment Date and ending
on the earlier to occur of (y) the payment in full to Series 1997-2
Certificateholders of the Invested Amount and (z) the Termination Date, an
amount equal to the Available Principal Collections deposited in the Collection
Account 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 shall be deposited into the Principal Funding
Account, and on the Class A Expected Final Payment Date and each
Distribution Date thereafter, and on each Special Payment Date, such
amounts shall be applied in accordance with Section 5.01(b);
(ii) an amount equal to Class B Monthly Principal for such
Distribution Date shall be deposited into the Principal Funding
Account, and on the earlier of the Class B Expected Final Payment Date
and the Distribution Date on which the Class A Invested Amount is paid
in full if such Distribution Date is after the Class A Expected Final
Payment Date, and each Distribution Date thereafter, and on each
Special Payment Date, such amounts shall be applied in accordance with
Section 5.01(d);
(iii) an amount equal to the Collateral Monthly Principal, if
any, for such Distribution Date shall be distributed to the Collateral
Interest Holder for application in accordance with the Collateral
Agreement; and
(iv) the balance, if any, of Available Principal Collections
then on deposit in the Collection Account
35
shall be treated as Shared Principal Collections and applied in
accordance with Section 4.04 of the Agreement.
Section 4.06. Defaulted Amounts; Charge-Offs. (a) If, on any
Distribution Date, the Collateral Defaulted Amount exceeds the amount of
Available Finance Charge Collections available to fund the Collateral Defaulted
Amount pursuant to Section 4.05(a)(x) on such Distribution Date, then the
Collateral Invested Amount shall be reduced by the amount of such excess;
provided, however, that the Collateral Invested Amount shall not be reduced
below zero. Such reductions shall thereafter be reimbursed and the Collateral
Invested Amount increased (but not by an amount in excess of the aggregate
unreimbursed reductions) on any Distribution Date by the amount of Available
Finance Charge Collections allocated and available for that purpose pursuant to
4.05(a)(xii).
(b) On each Determination Date, the Servicer shall calculate
the Class A Defaulted Amount, if any, for the related Distribution Date. If, on
any Distribution Date, the Class A Defaulted Amount for the related Monthly
Period exceeds the amount of Available Finance Charge Collections, the
Available Cash Collateral Amount and Reallocated Principal Collections applied
thereto on such Distribution Date, the Collateral Invested Amount (after giving
effect to reductions in the Collateral Invested Amount on such Distribution
Date (i) pursuant to Sections 4.05(b) and (c) in respect of the application of
Reallocated Principal Collections and (ii) pursuant to Section 4.06(a) in
respect of the amount by which the Collateral Defaulted Amount exceeded the
amount of Available Finance Charge Collections available to fund the Collateral
Defaulted Amount) shall be reduced by the amount of such excess. In the event
that such reduction would cause the Collateral Invested Amount to be reduced
below zero, the Collateral Invested Amount shall be reduced to zero and the
Class B Invested Amount (after giving effect to reductions in the Class B
Invested Amount on such Distribution Date (i) pursuant to Section 4.05(c) in
respect of the application of Reallocated Class B Principal Collections and
(ii) pursuant to Section 4.06(c) in respect of the amount by which the Class B
Defaulted Amount exceeded the amount of Available Finance Charge Collections,
the Available Cash Collateral Amount and Reallocated Collateral Principal
Collections available to fund the Class B Defaulted Amount)
36
shall be reduced by the amount by which the Collateral Invested Amount would
have been reduced below zero. In the event that such reduction would cause the
Class B Invested Amount to be reduced below zero, 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 (a "Class A Charge-Off"). Class A 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 Charge-Offs) on any Distribution
Date by the amount of Available Finance Charge Collections allocated and
available for that purpose pursuant to Section 4.05(a)(v).
(c) On each Determination Date, the Servicer shall calculate
the Class B Defaulted Amount, if any, for the related Distribution Date. If, on
any Distribution Date, the Class B Defaulted Amount for the related Monthly
Period exceeds the amount of Available Finance Charge Collections, the
Available Cash Collateral Amount and Reallocated Collateral Principal
Collections applied thereto for such Distribution Date, the Collateral Invested
Amount (after giving effect to reductions in the Collateral Invested Amount on
such Distribution Date (i) pursuant to Section 4.05(b) in respect of the
application of Reallocated Collateral Principal Collections, (ii) pursuant to
Section 4.06(a) in respect of the amount by which the Collateral Defaulted
Amount exceeded the amount of Available Finance Charge Collections available to
fund the Collateral Defaulted Amount and (iii) pursuant to Section 4.06(b) in
respect of the amount by which the Class A Defaulted Amount exceeded the amount
of Available Finance Charge Collections, the Available Cash Collateral Amount
and Reallocated Principal Collections available to fund the Class A Defaulted
Amount) shall be reduced by the amount of such excess. In the event that such
reduction would cause the Collateral Invested Amount to be reduced below zero,
the Collateral Invested Amount shall be reduced to zero and the Class B
Invested Amount shall be reduced by the amount by which the Collateral Invested
Amount would have been reduced below zero (any reduction in the Class B
Invested Amount in this paragraph (c) or paragraph (b) above, a "Class B
Charge-Off"). Class B 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 Charge-Offs) on any Distribution Date by the amount of
Available Finance Charge Collections allocated and
37
available for that purpose pursuant to Section 4.05(a)(viii).
Section 4.07. Additional Finance Charges. Subject to Section
4.05 of the Agreement, Additional Finance Charges with respect to the Series in
Group One for any Distribution Date shall be allocated to Series 1997-2 in an
amount equal to the product of (i) the aggregate amount of Additional Finance
Charges with respect to all the Series in Group One for such Distribution Date
and (ii) a fraction, the numerator of which is the Finance Charge Shortfall for
Series 1997-2 for such Distribution Date and the denominator of which is the
aggregate amount of Finance Charge Shortfalls for all the Series in Group One
for such Distribution Date. The "Finance Charge Shortfall" for Series 1997-2
for any Distribution Date shall be equal to the excess, if any, of (x) the full
amount required to be paid pursuant to Section 4.05(a) (excluding Section
4.05(a)(xv)) on such Distribution Date over (y) Available Finance Charge
Collections (excluding any Additional Finance Charges from other Series in
Group One that are allocated to Series 1997-2 on such Distribution Date) with
respect to the related Monthly Period.
Section 4.08. Shared Principal Collections. Subject to
Section 4.04 of the Agreement, Shared Principal Collections for any
Distribution Date shall be allocated to Series 1997-2 in an amount equal to the
product of (i) the aggregate amount of Shared Principal Collections with
respect to all Series for such Distribution Date and (ii) a fraction, the
numerator of which is the Principal Shortfall for Series 1997-2 for such
Distribution Date and the denominator of which is the aggregate amount of
Principal Shortfalls for all Series for such Distribution Date. The "Principal
Shortfall" for Series 1997-2 shall be equal to (w) for any Distribution Date
with respect to the Revolving Period, zero, (x) for any Distribution Date with
respect to the Class A Accumulation Period (on or prior to the Class A Expected
Final Payment Date), the excess, if any, of the Class A Controlled Deposit
Amount with respect to such Distribution Date over the amount of Available
Principal Collections for such Distribution Date (excluding any portion thereof
attributable to Shared Principal Collections), (y) for any Distribution Date
with respect to the Class B Accumulation Period (on or prior to the Class B
Expected Final Payment Date provided that the Class A Invested Amount was paid
in full on the Class A Expected
38
Final Payment Date), the excess, if any, of the Class B Controlled Deposit
Amount with respect to such Distribution Date over the amount of Available
Principal Collections for such Distribution Date (excluding any portion thereof
attributable to Shared Principal Collections) and (z) for any Distribution Date
with respect to the Early Amortization Period and any Distribution Date with
respect to the Class A Accumulation Period or the Class B Accumulation Period
commencing on the earlier of the Distribution Date following the Class A
Expected Final Payment Date if the Class A Invested Amount was not paid in full
on the Class A Expected Final Payment Date and the Distribution Date following
the Class B Expected Final Payment Date, the excess, if any, of the Invested
Amount over the amount of Available Principal Collections for such Distribution
Date (excluding any portion thereof attributable to Shared Principal
Collections).
Section 4.09. Reserve Account. (a) The Servicer may elect, in
its sole discretion, to establish and maintain, in the name of the Trustee, on
behalf of the Trust, for the benefit of the Class A Certificateholders, an
Eligible Deposit Account (the "Reserve Account") bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Class A Certificateholders. At the time of such election, the Servicer shall
notify the Trustee of the percentage to be specified under the definition of
Required Reserve Account Amount in Section 2.01(a). 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 Class A
Certificateholders. 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 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 in an amount up to the Available Reserve Account
Amount at such 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
39
Account make a deposit into the Reserve Account in the amount specified in, and
otherwise in accordance with, Section 4.05(a)(xi).
(b) Funds on deposit in the Reserve Account shall be invested
at the direction of the Servicer by the Trustee in Eligible Investments. Funds
on deposit in the Reserve Account on any Transfer Date or Distribution Date,
after giving effect to any withdrawals from the Reserve Account on such date,
shall be invested in such investments that will mature so that such funds will
be available for withdrawal on or prior to the following Transfer Date. The
Trustee shall maintain for the benefit of the Class A Certificateholders
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 shall sell, liquidate or dispose
of an Eligible Investment before its maturity, at the written direction of the
Servicer, if such sale, liquidation or disposal would not result in a loss of
all or part of the principal portion of such Eligible Investment (the Trustee
shall not be responsible for determining whether such a loss would result) or
if, prior to the maturity of such Eligible Investment, a default occurs in the
payment of principal, interest or any other amount with respect to such
Eligible Investment. On each Transfer Date, all interest and earnings (net of
losses and investment expenses) accrued since the preceding Transfer Date on
funds on deposit in the Reserve Account shall be retained in the Reserve
Account (to the extent that the Available Reserve Account Amount is less than
the Required Reserve Account Amount) and the balance, if any, shall be
distributed on the related Distribution Date to or at the direction of the
Sellers. For purposes of determining the availability of funds or the balance
in the 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 Class A Accumulation Period and the first Special
Payment Date (on or prior to the Class A Expected Final 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
40
Principal Funding Investment Proceeds with respect to such Distribution Date or
Special Payment Date; provided, that such amount shall be reduced to the extent
that funds otherwise would be available for deposit in the Reserve Account
under Section 4.05(a)(xi) with respect to such Distribution Date or Special
Payment 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 Available
Reserve Account Amount, 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 Available Finance Charge Collections for such Distribution Date.
(e) On or before each Transfer Date, the Servicer shall
determine the amount, if any, of the Reserve Account Surplus for the related
Distribution Date, after giving effect to all deposits to and withdrawals from
the Reserve Account required to be made with respect to such Distribution Date
(the "Transfer Date Reserve Account Surplus Amount"). In the event that the
Transfer Date Reserve Account Surplus Amount with respect to any Transfer Date
is greater than zero, the Trustee, on the related Distribution Date, acting in
accordance with the instructions of the Servicer, shall withdraw from the
Reserve Account, and pay to or at the direction of the Sellers, an amount equal
to such Transfer Date Reserve Account Surplus Amount.
(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 Invested Amount is paid in full to the Class A Certificateholders, (iii) the
Transfer Date immediately preceding the first Special Payment Date and (iv) the
Transfer Date immediately preceding the Class A Expected Final Payment Date,
the Trustee, acting in accordance with the instructions of the Servicer, after
the prior payment of all amounts owing to the Class A Certificateholders that
are payable from the Reserve Account as provided herein, shall withdraw from
the Reserve Account and pay to or at the direction of the Sellers, 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.
41
Section 4.10. Cash Collateral Account. (a) The Servicer shall
establish and maintain, in the name of the Trustee, on behalf of the Trust, for
the benefit of the Class A Certificateholders and the Class B Certificate-
holders, as their interests appear herein, an Eligible Deposit Account (the
"Cash Collateral Account") bearing a designation clearly indicating that the
funds deposited therein are held for the benefit of the Class A
Certificateholders and the Class B Certificateholders. The Trustee shall possess
all right, title and interest in all funds on deposit from time to time in the
Cash Collateral Account and in all proceeds thereof. The Cash Collateral Account
shall be under the sole dominion and control of the Trustee for the benefit of
the Class A Certificateholders and the Class B Certificateholders. If at any
time the Cash Collateral 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 con- sent) establish a new Cash Collateral Account meeting the conditions
specified above as an Eligible Deposit Account, and shall transfer any cash or
any investments to such new Cash Collateral Account. The Trustee, at the
direction of the Servicer, shall (i) on the Closing Date, deposit in the Cash
Collateral Account the proceeds of the advance to be made on such date by the
Sellers, (ii) make withdrawals from the Cash Collateral Account from time to
time in an amount up to the Available Cash Collateral Amount at such time, for
the purposes set forth in this Supplement, and (iii) on each Distribution Date
prior to the termination of the Cash Collateral Account make a deposit into the
Cash Collateral Account in the amount specified in, and otherwise in accordance
with, Section 4.05(a)(xiii). The Sellers shall not be entitled to reimbursement
from the Trust Assets for any withdrawals from the Cash Collateral Account
except as specifically provided in this Supplement.
(b) Funds on deposit in the Cash Collateral Account shall be
invested at the direction of the Servicer by the Trustee in Cash Collateral
Account Investments. Funds on deposit in the Cash Collateral Account on any
Transfer Date, after giving effect to any withdrawals from the Cash Collateral
Account on such Transfer Date, shall be invested in such investments that will
mature so that such funds will be available for withdrawal on or prior to the
following Transfer Date. No Cash Collateral Account Investment shall be
disposed of prior to its maturity;
42
provided, however, that the Trustee may sell, liquidate or dispose of a Cash
Collateral Account Investment before its maturity, if so directed by the
Servicer, the Servicer having reasonably determined that the interest of the
Class A Certificateholders and the Class B Certificateholders may be adversely
affected if such Cash Collateral Account Investment is held to its maturity.
The proceeds of any such investments shall be invested in such investments that
will mature so that such funds will be available for withdrawal on or prior to
the Transfer Date immediately following the date of such investment. The
Trustee shall maintain for the benefit of the Class A Certificateholders and
the Class B Certificateholders possession of the negotiable instruments or
securities, if any, evidencing the Cash Collateral Account Investments. On each
Distribution Date, the Servicer shall direct the Trustee to withdraw from the
Cash Collateral Account and deposit into the Collection Account all interest
and earnings (net of losses and investment expenses) ("Cash Collateral
Investment Proceeds") accrued since the preceding Distribution Date on funds on
deposit in the Cash Collateral Account and such Cash Collateral Investment
Proceeds shall be treated as a portion of Available Finance Charge Collections
for such Distribution Date. For purposes of determining the availability of
funds or the balances in the Cash Collateral Account for any reason under this
Supplement, all investment earnings on such funds shall be deemed not to be
available or on deposit.
(c) In the event that for any Distribution Date the Required
Amount (such amount being referred to as the "Required Draw Amount") is greater
than zero, the Servicer shall give written notice to the Trustee and the
Sellers, in substantially the form of Exhibit E, of such positive Required Draw
Amount on the related Determination Date. The Required Draw Amount, if any, up
to the Available Cash Collateral Amount shall be withdrawn from the Cash
Collateral Account and distributed to fund any Required Amount, the amount of
such Available Cash Collateral Amount being applied to the components of the
Required Amount in the same priority as amounts are applied to such components
from Available Finance Charge Collections pursuant to Section 4.05(a).
(d) On or before each Distribution Date, the Servicer shall
determine the amount, if any, of the Cash Collateral Account Surplus Amount for
such Distribution
43
Date. In the event that the Cash Collateral Account Surplus Amount with respect
to any Distribution Date is greater than zero, the Trustee, on such
Distribution Date, acting in accordance with the instructions of the Servicer,
shall withdraw from the Cash Collateral Account, and pay to or at the direction
of the Sellers, an amount equal to such Cash Collateral Account Surplus Amount.
(e) Upon the earliest to occur of (i) the termination of the
Trust pursuant to Article XII of the Agreement, (ii) the Termination Date and
(iii) the day on which the Class A Invested Amount and the Class B Invested
Amount are paid in full to the Class A Certificateholders and the Class B
Certificateholders, the Trustee, acting in accordance with the instructions of
the Servicer, after the prior payment of all amounts owing to the Class A
Certificateholders and the Class B Certificateholders which are payable from
the Cash Collateral Account as provided herein, shall withdraw from the Cash
Collateral Account and pay to or at the direction of the Sellers, all amounts,
if any, on deposit in the Cash Collateral Account and the Cash Collateral
Account shall be deemed to have terminated for purposes of this Supplement.
Section 4.11. Interest Rate Protection Agreements. (a) The
Sellers may determine from time to time, in their sole discretion, to obtain
one or more Interest Rate Protection Agreements with respect to Series 1997-2.
Upon any such determination, the Servicer shall obtain such an Interest Rate
Protection Agreement in favor of the Trust for the benefit of the Series 1997-2
Certificateholders by directing the Trustee to accept an assignment of such
Interest Rate Protection Agreement and the Trustee shall accept such
assignment. The Interest Rate Protection Agreement shall provide that the Trust
shall be entitled to receive any payments from the Interest Rate Protection
Provider thereunder (which payments shall be determined in accordance with the
Interest Rate Protection Agreement). Any Interest Rate Protection Agreement may
be terminated by the Sellers or assigned by the Trust to or at the direction of
the Sellers at any time at the Sellers' election and in their sole discretion.
The Sellers may assign to the Trust at any time in their sole discretion any
Interest Rate Protection Agreement so long as the Trust is neither required to
pay for nor obligated to make payments pursuant to such Interest Rate
Protection Agreement, and the Sellers may assign to the Trust pursuant to this
Section 4.11 any Interest Rate Protection Agreement that
44
obligates the Trust to make any payments pursuant thereto if the conditions
specified in Section 9.06 have been satisfied with respect thereto. The Sellers
will notify each Rating Agency in writing of the assignment of any Interest
Rate Protection Agreement to the Trust within five Business Days following such
assignment, unless earlier notice is given in connection with the satisfaction
of any required Rating Agency Condition.
(b) The Trustee hereby appoints the Servicer to perform the
duties of the calculation agent under any Interest Rate Protection Agreement
and the Servicer accepts such appointment.
(c) The Trustee hereby agrees to make demand under the
guarantee, if any, of any Interest Rate Protection Agreement in the event that
the Interest Rate Protection Provider shall fail to make any payment as
provided in the Interest Rate Protection Agreement.
ARTICLE V
Distributions and Reports to
Series 1997-2 Certificateholders
Section 5.01. Distributions. (a) On each 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 Payment Date to pay interest on the Class A
Certificates pursuant to this Supplement.
(b) On each Special Payment Date (on or prior to the Class B
Principal Commencement Date), on the Class A Expected Final Payment Date and on
each Distribution Date with respect to the Class A Accumulation Period
following the Class A Expected Final 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 on deposit in the Principal
Funding Account (or otherwise held by the Paying Agent) and that are allocated
and available on such date to pay principal of the Class A Certificates
pursuant
45
to this Supplement up to a maximum amount on any such date equal to the Class A
Invested Amount on such date (unless there has been an optional repurchase of
the Series 1997-2 Certificateholders' Interest pursuant to Section 10.01 of the
Agreement, in which event the foregoing limitation shall not apply).
(c) On each Payment 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 Payment Date to pay interest on the Class B Certificates
pursuant to this Supplement.
(d) On each Special Payment Date (on or after the Class B
Principal Commencement Date), on the Class B Expected Final Payment Date and on
each Distribution Date with respect to the Class B Accumulation Period
commencing on the earlier of the Distribution Date following the Class A
Expected Final Payment Date if the Class A Invested Amount was not paid in full
on the Class A Expected Final Payment Date and the Distribution Date following
the Class B Expected Final Payment 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 on deposit in the Principal Funding Account (or
otherwise held by the Paying Agent) and 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
Invested Amount on such date (unless there has been an optional repurchase of
the Series 1997-2 Certificateholders' Interest pursuant to Section 10.01 of the
Agreement, in which event the foregoing limitation shall not apply).
(e) The distributions to be made pursuant to this Section
5.01 are subject to the provisions of Sections 2.06, 9.02, 10.01 and 12.02 of
the Agreement and Sections 8.01 and 8.02 of this Supplement.
(f) Except as provided in Section 12.02 of the Agreement with
respect to a final distribution, distributions to Class A Certificateholders
and Class B Certificateholders hereunder shall be made by check mailed
46
to each Class A Certificateholder and Class B Certificateholder at such
Certificateholder's address appearing in the Certificate Register without
presentation or surrender of any Class A Certificate or Class B Certificate or
the making of any notation thereon; provided, however, that with respect to
Class A Certificates and Class B Certificates registered in the name of a
Clearing Agency, such distributions shall be made to such Clearing Agency in
immediately available funds.
(g) Distributions to the Collateral Interest Holder shall be
made in accordance with the terms of the Collateral Agreement, subject to the
terms of, and the amounts allocated and available for such purpose under, the
Agreement and this Supplement.
Section 5.02. Reports and Statements. (a) On each Distribution
Date, the Paying Agent, on behalf of the Trustee, shall forward to each Series
1997-2 Certificateholder a statement substantially in the form of Exhibit C
prepared by the Servicer.
(b) (i) Not later than each Determination Date, the Servicer
shall deliver to the Trustee and the Paying Agent (x) a statement substantially
in the form of Exhibit C prepared by the Servicer and (y) a certificate of a
Servicing Officer substantially in the form of Exhibit D, and (ii) not later
than each Distribution Date, the Paying Agent shall deliver to each Rating
Agency a copy of the statements delivered to it by the Servicer pursuant to
clause (i).
(c) A copy of each statement or certificate provided pursuant
to paragraph (a) or (b) may be obtained by any Series 1997-2 Certificateholder
or any Certificate Owner with respect to Series 1997-2 by a request in writing
to the Servicer.
(d) On or before January 31 of each calendar year, beginning
with calendar year 1998, 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 1997-2 Certificateholder, a statement
prepared by the Servicer containing the information that is required to be
contained in the statement in paragraph (a) above, aggregated for such calendar
year or the applicable portion thereof during which
47
such Person was a Series 1997-2 Certificateholder, together with such other
information, if any, as is required to be provided 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
Pay Out Events
Section 6.01. Additional Pay Out Event. The occurrence of the
following event (as determined by the Servicer on any Determination Date) shall,
immediately on such Determination Date without notice or other action on the
part of the Trustee or the Series 1997-2 Certificateholders, be deemed to be a
Pay Out Event solely with respect to Series 1997-2:
the average of the Portfolio Yields for any three consecutive
Monthly Periods is less than the average of the Base Rates for such
Monthly Periods.
ARTICLE VII
Optional Repurchase; Series Termination
Section 7.01 Optional Repurchase. (a) On any day occurring on
or after the date on which the Invested Amount is reduced to 5% or less of the
Initial Invested Amount, the Sellers shall have the option to purchase the
Series 1997-2 Certificateholders' Interest, at a purchase price equal to (i) if
such day is a Distribution Date, the Reassignment Amount for the day
immediately preceding such Distribution Date or (ii) if such day is not a
Distribution Date, the Reassignment Amount for the day immediately preceding
the Distribution Date following such day.
(b) The Sellers shall give the Servicer and the Trustee at
least 30 days prior written notice of the date on which the Sellers intend to
exercise such purchase option. Not later than 12:00 noon, New York City time,
on such Distribution Date the Sellers shall deposit the Reassignment Amount
into the Collection Account in immediately available
48
funds. Such purchase option is subject to payment in full of the Reassignment
Amount. Following the deposit of the Reassignment Amount into the Collection
Account in accordance with the foregoing, the Invested Amount for Series 1997-2
shall be reduced to zero and the Series 1997-2 Certificateholders shall have no
further interest in the Receivables. The Reassignment Amount shall be
distributed as set forth in Section 8.01(b).
Section 7.02. Series Termination. (a) If, on the March 2008
Distribution Date, the Invested 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 that 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
Invested Amount at the close of business on the last day of the Monthly Period
preceding the Termination Date (after giving effect to all distributions
required to be made on the Termination Date, except pursuant to this Section
7.02). Such bids shall require that such sale shall (subject to Section
7.02(b)) occur on the Termination Date. The Sellers and the Collateral Interest
Holder 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 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 the Series 1997-2
Certificateholders pursuant to the Agreement and this Supplement; provided,
however, that the Servicer shall determine conclusively the amount of such
proceeds that are allocable to Finance Charge Receivables and the amount of
such proceeds that are allocable to Principal Receivables. During the period
from the March 2008 Distribution Date to the 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.
49
ARTICLE VIII
Final Distributions
Section 8.01. Sale of Receivables or Certificateholders'
Interest Pursuant to Section 2.06 or 10.01 of the Agreement. (a) Purchase Price.
(i) The amount to be paid by each Seller with respect to Series 1997-2 in
connection with a reassignment of Receivables pursuant to Section 2.06 of the
Agreement shall equal the product of (x) the Reassignment Amount for the first
Distribution Date following the Monthly Period in which the reassignment
obligation arises under the Agreement and (y) a fraction, the numerator of which
is equal to the aggregate amount of Principal Receivables in the Trust on the
last day of the Monthly Period preceding such Distribution Date that were
transferred to the Trust by such Seller and the denominator of which is equal to
the aggregate amount of Principal Receivables in the Trust on such day.
(ii) The amount to be paid b the Sellers with respect to
Series 1997-2 in connection with a repurchase of the Certificateholders'
Interest pursuant to Section 10.01 of the Agreement shall equal the sum of (x)
the Reassignment Amount for the Distribution Date of such repurchase and (y) the
sum of (I) the excess, if any, of (A) a price equivalent to the average of bids
quoted on the Record Date preceding the date of repurchase by at least two
recognized dealers selected by the Trustee (which may be selected from the list
attached as Schedule 1), for the purchase by such dealers of a security that is
similar to the Class A Certificates with a remaining maturity approximately
equal to the remaining maturity of the Class A Certificates and rated by each
Rating Agency in the rating category originally assigned to the Class A
Certificates over (B) the portion of the Reassignment Amount attributable to the
Class A Certificates and (II) the excess, if any, of (A) a price equivalent to
the average of bids quoted on the Record Date preceding the date of repurchase
by at least two recognized dealers selected by the Trustee (which may be
selected from the list attached as Schedule 1), for the purchase by such dealers
of a security that is similar to the Class B Certificates with a remaining
maturity approximately equal to the remaining maturity of the Class B
Certificates and rated by each Rating Agency in the rating category originally
assigned to the Class B Certificates
50
over (B) the portion of the Reassignment Amount attributable to the Class B
Certificates.
(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 7.01 or
8.01(a)(ii) or any amounts allocable to the Series 1997-2 Certificateholders'
Interest deposited into the Collection Account pursuant to Section 7.02, the
Trustee shall, not later than 12:00 noon, New York City time, on the related
Distribution Date, make deposits or distributions of the following amounts (in
the priority set forth below and, in each case, after giving effect to any
deposits and distributions otherwise to be made on such date) in immediately
available funds: (i) (x) the Class A Invested Amount on such Distribution Date
shall 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, shall be distributed to the Paying Agent for payment to the Class A
Certificateholders, (ii) (x) the Class B Invested Amount on such Distribution
Date shall 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 and Class B Subordinated Monthly Interest for such Distribution Date,
(B) any Class B Monthly Interest and any Class B Subordinated 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 and Class B
Subordinated Additional Interest, if any, for such Distribution Date and any
Class B Additional Interest and any Class B Subordinated Additional Interest
previously due but not distributed to the Class B Certificateholders on any
prior Distribution Date, shall be distributed to the Paying Agent for payment to
the Class B Certificateholders and (iii) the balance, if any, shall be
distributed to the Collateral Interest Holder for application in accordance with
the Collateral Agreement. Notwithstanding anything to the contrary contained in
this Supplement or the Agreement, the amount of any excess
51
determined pursuant to paragraph (a)(ii)(y)(I) shall be distributed to the Class
A Certificateholders and the amount of any excess determined pursuant to
paragraph (a)(ii)(y)(II) shall be distributed to the Class B Certificateholders.
(c) Distributions Pursuant to Section 2.06 of the Agreement.
With respect to any amounts deposited into the Collection Account pursuant to
Section 8.01(a)(i), the Trustee shall, not later than 12:00 noon, New York City
time, on the related Distribution Date, deposit the principal portion of such
amounts into the Special Funding Account.
(d) Notwithstanding anything to the contrary in this
Supplement or the Agreement, all amounts distributed to the Paying Agent and the
Collateral Interest Holder pursuant to Section 8.01(b) for payment to the Series
1997-2 Certificateholders shall be deemed distributed in full to the Series
1997-2 Certificateholders on the date on which such funds are distributed to the
Paying Agent and the Collateral Interest Holder pursuant to this Section and
shall be deemed to be a final distribution pursuant to Section 12.02 of the
Agreement.
Section 8.02. 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 Distribution Date
following the date on which the Insolvency Proceeds are deposited into the
Collection Account pursuant to Section 9.02(b) of the Agreement, 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 Distribution Date) (i)
deduct an amount equal to the Class A Invested Amount on such Distribution Date
from the portion of the Insolvency Proceeds allocated to Collections of
Principal Receivables and distribute such amount to the Paying Agent for payment
to the Class A Certificateholders, provided that the amount of such distribution
shall not exceed the product of (x) the portion of the Insolvency Proceeds
allocated to Collections of Principal Receivables and (y) the Principal
Allocation Percentage with respect to the related Monthly Period, (ii) deduct an
amount equal to the Class B Invested Amount on such Distribution Date from the
portion of the Insolvency Proceeds allocated to Collections of Principal
Receivables and distribute such
52
amount to the Paying Agent for payment to the Class B Certificateholders,
provided that the amount of such distribution shall not exceed (x) the product
of the portion of the Insolvency Proceeds allocated to Collections of Principal
Receivables and the Principal Allocation Percentage with respect to such Monthly
Period minus (y) the amount distributed to the Paying Agent pursuant to clause
(a)(i) of this sentence and (iii) deduct an amount equal to the Collateral
Invested Amount on such Distribution Date from the portion of the Insolvency
Proceeds allocated to Collections of Principal Receivables and distribute such
amount to the Collateral Interest Holder for application in accordance with the
Collateral Agreement, provided that the amount of such distribution shall not
exceed (x) the product of the portion of the Insolvency Proceeds allocated to
Collections of Principal Receivables and the Principal Allocation Percentage
with respect to such Monthly Period minus (y) the amount distributed to the
Paying Agent pursuant to clauses (a)(i) and (a)(ii) of this sentence. To the
extent that the product of (A) the portion of the Insolvency Proceeds allocated
to Collections of Principal Receivables and (B) the Principal Allocation
Percentage with respect to the related Monthly Period exceeds the aggregate
amounts distributed to the Paying Agent and the Collateral Interest Holder
pursuant to the preceding sentence, the excess shall be allocated to the
Sellers' Interest and shall be released to the Sellers on such Distribution
Date.
(b) Not later than 12:00 noon, New York City time, on such
Distribution 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 Distribution Date) (i) deduct an amount equal to the sum of (w) Class A
Monthly Interest for such Distribution Date, (x) any Class A Monthly Interest
previously due but not distributed to the Class A Certificateholders on a prior
Distribution Date and (y) 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 a prior Distribution Date
from the portion of the Insolvency Proceeds allocated to Collections of Finance
Charge Receivables and distribute such amount to the Paying Agent for payment to
the Class A Certificateholders, provided that the amount of such distribution
shall not exceed the product of (x) the portion of the Insolvency Proceeds
allocated to Collections of Finance Charge Receivables and (y) the Floating
Allocation
53
Percentage with respect to the related Monthly Period and (ii) deduct an amount
equal to the sum of (w) Class B Monthly Interest and Class B Subordinated
Monthly Interest for such Distribution Date, (x) any Class B Monthly Interest
and any Class B Subordinated Monthly Interest previously due but not distributed
to the Class B Certificateholders on a prior Distribution Date and (y) the
amount of Class B Additional Interest and Class B Subordinated Additional
Interest, if any, for such Distribution Date and any Class B Additional Interest
and any Class B Subordinated Additional Interest previously due but not
distributed to the Class B Certificateholders on a prior Distribution Date from
the portion of the Insolvency Proceeds allocated to Collections of Finance
Charge Receivables and distribute such amount to the Paying Agent for payment to
the Class B Certificateholders, provided that the amount of such distribution
shall not exceed (x) the product of the portion of the Insolvency Proceeds
allocated to Collections of Finance Charge Receivables and the Floating
Allocation Percentage with respect to the related Monthly Period minus (y) the
amount distributed to the Paying Agent pursuant to clause (b)(i) of this
sentence. To the extent that the product of (A) the portion of the Insolvency
Proceeds allocated to Collections of Finance Charge Receivables and (B) the
Floating Allocation Percentage with respect to the related Monthly Period
exceeds the aggregate amount distributed to the Paying Agent pursuant to the
preceding sentence, the excess shall be released to the Collateral Interest
Holder for application by the Collateral Interest Holder in accordance with the
Collateral Agreement.
(c) Notwithstanding anything to the contrary in this
Supplement or the Agreement, all amounts distributed to the Paying Agent and the
Collateral Interest Holder pursuant to this Section for payment to the Series
1997-2 Certificateholders shall be distributed in full to the Series 1997-2
Certificateholders on the date on which funds are distributed to the Paying
Agent and the Collateral Interest Holder pursuant to this Section and shall be
deemed to be a final distribution pursuant to Section 12.02 of the Agreement.
(d) Notwithstanding any provision of the Agreement or this
Supplement, for purposes of Section 9.02(a) of the Agreement, the holders of the
Series 1997-2 Certificates shall not be deemed to have disapproved a liquidation
of the Receivables following an
54
Insolvency Event with respect to any of the Sellers unless (i) holders of more
than 50% of the aggregate unpaid principal amount of each of the Class A
Certificates and the Class B Certificates and (ii) the Collateral Interest
Holder shall have disapproved of such liquidation (or, if the Collateral
Interest Holder shall have assigned all or part of its interest under the
Collateral Agreement to one or more Persons, then one or more Persons holding
more than 50% of such interest shall have disapproved of such liquidation).
ARTICLE IX
Miscellaneous Provisions
Section 9.01. 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 9.02. 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 9.03. Governing Law. THIS SUPPLEMENT SHALL BE
CONSTRUED IN ACCORDANCE WITH THE LAWS OF 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 9.04. Series Enhancer Notices. The Collateral Interest
Holder shall be entitled to receive all notices and other items that are
available to be delivered to Series Enhancers pursuant to Sections 2.03,
2.04(b), 6.03(d), 8.07 and 9.02 of the Agreement, except for notices and other
items that relate solely to Series other than Series 1997-2.
Section 9.05. Determination of Material Adverse Effect. Any
determination of material adverse effect on Investor Certificateholders under
the Agreement or this Supplement shall be made assuming the Collateral Invested
55
Amount is zero and without regard to whether funds are available in the Cash
Collateral Account (including, without limitation, any determination of whether
a representation or warranty made therein is correct or whether a Seller or the
Servicer has duly performed a covenant contained therein or herein).
Section 9.06. Amendment to Reflect Swap. This Supplement may
be amended pursuant to Section 13.01(a) of the Agreement without the consent of
any of the Series 1997-2 Certificateholders but subject to the conditions
specified in Section 13.01(a) of the Agreement, to provide that the Trust shall
enter into a swap agreement relating to amounts that would otherwise be
distributed to the Sellers under Section 4.05(a)(xv).
Section 9.07. Other Amendments. Notwithstanding anything to
the contrary in the Agreement or this Supplement, any amendment to this
Supplement to change the Required Cash Collateral Amount or the Required
Collateral Invested Amount such that (i) the Required Enhancement Amount is not
reduced or (ii) the Sellers acquire an interest in the Trust that is subordinate
to the Class A Certificates and the Class B Certificates as a replacement for
any such reduction in the Required Enhancement Amount (provided that such action
will not have an adverse regulatory impact upon either of the Sellers), shall be
deemed conclusively not to affect adversely in any material respect the
interests of any Class A Certificateholder and Class B Certificateholder, so
long as the Rating Agency Condition shall have been satisfied with respect to
such amendment, and such amendment may be entered into without
56
the consent of any of the Class A Certificateholders and Class B
Certificateholders.
IN WITNESS WHEREOF, the Sellers, the Servicer and the Trustee
have caused this Supplement to be duly executed by their respective officers as
of the day and year first above written.
FIRST DEPOSIT NATIONAL BANK,
Seller and Servicer,
by /s/ Xxxx X. Xxxxxxx
------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
PROVIDIAN NATIONAL BANK,
Seller,
by /s/ Xxxx X. Xxxxxxx
------------------------------
Name: Xxxx X. Xxxxxxx
Title: Vice President
BANKERS TRUST COMPANY,
Trustee,
by /s/ Xxxx Xxxxxxx
------------------------------
Name: Xxxx Xxxxxxx
Title: Assistant Vice President
EXHIBIT A-1
REGISTERED $__________*
No. R- CUSIP No. [ ]
[Unless this Class A Certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to the issuer or its agent for registration of transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein.]
PROVIDIAN MASTER TRUST
FLOATING RATE CLASS A ASSET BACKED CERTIFICATE
Series 1997-2
Each $1,000 minimum denomination represents a
1/570,500 undivided interest in certain assets of the
PROVIDIAN MASTER TRUST
Evidencing an undivided interest in a trust, the corpus of which consists
primarily of receivables generated from time to time in the ordinary course of
business in a portfolio of revolving credit card accounts by
FIRST DEPOSIT NATIONAL BANK
and
PROVIDIAN NATIONAL BANK
and, in certain circumstances, certain Additional Sellers (as defined in the
Pooling and Servicing Agreement referred to below).
------------
*Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
2
(Not an interest in or obligation of First Deposit
National Bank, Providian National Bank,
any Additional Sellers or any affiliate thereof)
3
This certifies that (the "Class A Certificateholder") is the
registered owner of a fractional undivided interest in certain assets of a trust
(the "Trust") created pursuant to the Pooling and Servicing Agreement dated as
of June 1, 1993 (as amended and supplemented, other than by any amendment or
supplement relating to a specific Series, the "Agreement"), as supplemented by
the Series 1997-2 Supplement dated as of March 1, 1997 (as amended and
supplemented, the "Series Supplement"), among First Deposit National Bank, a
national banking association, as Seller and Servicer, Providian National Bank, a
national banking association, as Seller, and Bankers Trust Company, a New York
banking corporation, as trustee (the "Trustee"). The Trust will also issue
$66,500,000 of Floating Rate Class B Asset Backed Certificates, Series 1997-2
and $63,000,000 of Collateral Interest, Series 1997-2 which will be subordinated
to the Class A Certificates as described in the Series Supplement. The corpus of
the Trust consists of (i) a portfolio of all receivables (the "Receivables")
existing in the revolving credit card accounts and other revolving credit
accounts identified under the Agreement from time to time (the "Accounts"), (ii)
all Receivables generated under the Accounts from time to time thereafter, (iii)
funds collected or to be collected from accountholders in respect of the
Receivables, (iv) all funds which are from time to time on deposit in the
Collection Account and in the Series Accounts, (v) the benefits of certain
Series Enhancements including a Cash Collateral Account for the benefit of the
Class A Certificateholders and the Class B Certificateholders which will have an
initial balance of $21,000,000, (vi) if applicable, payments, if any, received
under any interest rate swap or cap agreement assigned to the Trust for the
benefit of the Series 1997-2 Certificateholders and (vii) all other assets and
interests constituting the Trust. Although a summary of certain provisions of
the Agreement and the Series Supplement is set forth below and on the Summary of
Terms and Conditions attached hereto and made a part hereof, this Class A
Certificate does not purport to summarize the Agreement and the Series
Supplement and reference is made to the Agreement and the Series Supplement for
information with respect to the interests, rights, benefits, obligations,
proceeds and duties evidenced hereby and the rights, duties and obligations of
the Trustee. A copy of the Agreement and the Series Supplement (without
schedules) may be requested from the Trustee by writing to the Trustee at the
Corporate Trust
4
Office. To the extent not defined herein, the capitalized terms used herein have
the meanings ascribed to them in the Agreement or the Series Supplement, as
applicable.
This Class A Certificate is issued under and is subject to the
terms, provisions and conditions of the Agreement and the Series Supplement, to
which Agreement and Series Supplement, each as amended and supplemented from
time to time, the Class A Certificateholder by virtue of the acceptance hereof
assents and is bound. It is the intent of the Sellers and the Series 1997-2
Certificateholders that, for Federal, state and local income and franchise tax
purposes only, the Series 1997-2 Certificates will qualify as indebtedness of
the Sellers secured by the Receivables. The Class A Certificateholder, by the
acceptance of this Class A Certificate, agrees to treat this Class A Certificate
for Federal, state and local income and franchise tax purposes as indebtedness
of the Sellers.
In general, payments of principal with respect to the Class A
Certificates are limited to the Class A Invested Amount, which may be less than
the unpaid principal balance of the Class A Certificates. The final principal
payment with respect to the Class A Certificates is scheduled to be made on the
March 2004 Distribution Date, but the final principal payment with respect to
the Class A Certificates may be paid earlier or later under certain
circumstances described in the Agreement and the Series Supplement. If for one
or more months during the Class A Accumulation Period there are not sufficient
funds to pay the Class A Controlled Accumulation Amount, then to the extent that
excess funds are not available on subsequent Distribution Dates with respect to
the Class A Accumulation Period to make up for such shortfalls, the final
payment of principal of the Class A Certificates will occur later than the March
2004 Distribution Date.
5
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee, by manual signature, this Class A
Certificate shall not be entitled to any benefit under the Agreement or the
Series Supplement or be valid for any purpose.
IN WITNESS WHEREOF, the Sellers have caused this Class A
Certificate to be duly executed.
FIRST DEPOSIT NATIONAL BANK,
By ________________________________
Name:
Title:
PROVIDIAN NATIONAL BANK,
By ________________________________
Name:
Title:
Dated: , 199
6
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates described in the within-mentioned
Agreement and Series Supplement.
BANKERS TRUST COMPANY,
as Trustee,
By: ___________________
Authorized Officer
or
By:
as Authenticating Agent
for the Trustee,
By: ___________________
Authorized Officer
7
PROVIDIAN MASTER TRUST
FLOATING RATE CLASS A ASSET BACKED CERTIFICATE
Series 1997-2
Summary of Terms and Conditions
This Class A Certificate is one of a Series of Certificates
entitled Providian Master Trust, Asset Backed Certificates, Series 1997-2 (the
"Series 1997-2 Certificates"), and one of a Class thereof entitled Floating Rate
Class A Asset Backed Certificates, Series 1997-2 (the "Class A Certificates"),
each of which represents a fractional undivided interest in certain assets of
the Trust. The Receivables consist of Principal Receivables which arise
generally from the purchase of merchandise and services and amounts advanced to
accountholders as cash advances and Finance Charge Receivables. The Trust Assets
are allocated in part to the certificateholders of all outstanding Series (the
"Certificateholders' Interest") with the remainder allocated to the Sellers. The
aggregate interest represented by the Class A Certificates at any time in the
Principal Receivables in the Trust shall not exceed an amount equal to the Class
A Invested Amount at such time. The Class A Initial Invested Amount is
$570,500,000. In addition to the Class A Certificates, the Floating Rate Class B
Asset Backed Certificates, Series 1997-2, the Collateral Interest, Series
1997-2, the Series 1997-1 Certificates, issued contemporaneously with the Series
1997-2 Certificates, and other Series of Investor Certificates previously issued
by the Trust, a Sellers' Certificate has been issued to the Sellers pursuant to
the Agreement which represents the Sellers' Interest.
Subject to the terms and conditions of the Agreement, the
Sellers may from time to time direct the Trustee, on behalf of the Trust, to
issue one or more new Series of Investor Certificates, which will represent
fractional undivided interests in certain of the Trust Assets.
On each Distribution Date, the Paying Agent shall distribute
to each Class A Certificateholder of record on the last business day of the
preceding calendar month (each
8
a "Record Date") such Class A Certificateholder's pro rata share of such amounts
on deposit in the Collection Account and the Principal Funding Account as are
payable to the Class A Certificateholders pursuant to the Agreement and the
Series Supplement. Distributions with respect to this Class A Certificate will
be made by the Paying Agent by check mailed to the address of the Class A
Certificateholder of record appearing in the Certificate Register without the
presentation or surrender of this Class A Certificate or the making of any
notation thereon (except for the final distribution in respect of this Class A
Certificate) except that with respect to Class A Certificates registered in the
name of Cede & Co., the nominee for The Depository Trust Company, distributions
will be made in the form of immediately available funds. Final payment of this
Class A Certificate will be made only upon presentation and surrender of this
Class A Certificate at the office or agency specified in the notice of final
distribution delivered by the Trustee to the Class A Certificateholders in
accordance with the Agreement and the Series Supplement.
On any day occurring on or after the day on which the Invested
Amount is reduced to 5% or less of the Initial Invested Amount, the Sellers have
the option to repurchase the Series 1997-2 Certificateholders' Interest in the
Trust. The repurchase price of the Class A Certificates will be equal to (a) if
such day is a Distribution Date, the Reassignment Amount for the day immediately
preceding such Distribution Date or (b) if such day is not a Distribution Date,
the Reassignment Amount for the day immediately preceding the Distribution Date
following such day; excluding, in each case, any portion of the Reassignment
Amount consisting of amounts payable to the Class B Certificateholders or the
Collateral Interest Holder. Following the deposit of such repurchase price in
the Collection Account, the Class A Certificateholders will not have any
interest in the Receivables and the Class A Certificates will represent only the
right to receive such repurchase price.
This Class A Certificate does not represent an obligation of,
or an interest in, the Sellers, the Servicer or any affiliate of any of them and
is not insured or guaranteed by the Federal Deposit Insurance Corporation or any
other governmental agency or instrumentality. This Class A Certificate is
limited in right of payment to certain Collections with respect to the
Receivables (and
9
certain other amounts), all as more specifically set forth hereinabove and in
the Agreement and the Series Supplement.
The Agreement or any Supplement may, subject to certain
conditions, be amended by the Sellers, the Servicer and the Trustee without
Investor Certificateholder consent. The Trustee may, but shall not be obligated
to, enter into any such amendment which affects the Trustee's rights, duties or
immunities under the Agreement or otherwise.
The Agreement or any Supplement may also be amended from time
to time (including in connection with the issuance of a Supplemental
Certificate) by the Servicer, the Sellers and the Trustee, with the consent of
the Holders of Investor Certificates evidencing not less than 66-2/3% of the
aggregate unpaid principal amount of the Investor Certificates of all adversely
affected Series, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or any Supplement
or of modifying in any manner the rights of the Investor Certificateholders;
provided, however, that no such amendment shall (i) reduce in any manner the
amount of or delay the timing of any distributions to be made to Investor
Certificateholders or deposits of amounts to be so distributed or the total
amount of Series Enhancement available for the benefit of a Series without the
consent of each affected Investor Certificateholder (provided that any amendment
to the terms of a Pay Out Event shall not be deemed to be within the scope of
this clause (i)), (ii) change the definition of or the manner of calculating the
interest of any Investor Certificateholder without the consent of each affected
Investor Certificateholder, (iii) reduce the aforesaid percentage required to
consent to any such amendment without the consent of each Investor
Certificateholder or (iv) adversely affect the rating of any Series or Class by
each Rating Agency without the consent of the Holders of Investor Certificates
of such Series or Class evidencing not less than 66-2/3% of the aggregate unpaid
principal amount of the Investor Certificates of such Series or Class. The
Trustee may, but shall not be obligated to, enter into any such amendment which
affects the Trustee's rights, duties or immunities under this Agreement or
otherwise.
The Class A Certificates are issuable only in minimum
denominations of $1,000 and integral multiples of $1,000. The transfer of this
Class A Certificate shall be
10
registered in the Certificate Register upon surrender of this Class A
Certificate for registration of transfer at any office or agency maintained by
the Transfer Agent and Registrar accompanied by a written instrument of
transfer, in a form satisfactory to the Trustee or the Transfer Agent and
Registrar, duly executed by the Class A Certificateholder or such Class A
Certificateholder's attorney-in-fact, and duly authorized in writing with such
signature guaranteed, and thereupon one or more new Class A Certificates of
authorized denominations and for the same aggregate fractional undivided
interest will be issued to the designated transferee or transferees.
As provided in the Agreement and subject to certain
limitations therein set forth, Class A Certificates are exchangeable for new
Class A Certificates evidencing like aggregate fractional undivided interests as
requested by the Class A Certificateholder surrendering such Class A
Certificates. No service charge may be imposed for any such exchange but the
Servicer or Transfer Agent and Registrar may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
therewith.
The Servicer, the Trustee, the Paying Agent and the Transfer
Agent and Registrar and any agent of any of them, may treat the person in whose
name this Class A Certificate is registered as the owner hereof for all
purposes, and neither the Servicer nor the Trustee, the Paying Agent, the
Transfer Agent and Registrar, nor any agent of any of them, shall be affected by
notice to the contrary except in certain circumstances described in the
Agreement.
THIS CLASS A CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH
THE LAWS OF 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.
11
ASSIGNMENT
Social Security or other identifying number of assignee
_____________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto _________________________________________________________________
________________________________________________________________________________
(name and address of assignee)
the within Certificate and all rights thereunder, and hereby irrevocably
constitutes and appoints _____________________ attorney-in-fact, to transfer
said Certificate on the books kept for registration thereof, with full power of
substitution in the premises.
Dated: _______________________*
Signature Guaranteed:
________________________
------------
(*) NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Certificate in every
particular, without alteration, enlargement or any change whatsoever.
EXHIBIT A-2
REGISTERED $__________*
No. R- CUSIP No. [ ]
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A BENEFIT PLAN
(AS DEFINED BELOW).
[Unless this Class B Certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to the issuer or its agent for registration of transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein.]
PROVIDIAN MASTER TRUST
FLOATING RATE CLASS B ASSET BACKED CERTIFICATE
Series 1997-2
Each $1,000 minimum denomination represents a
1/66,500 undivided interest in certain assets of the
PROVIDIAN MASTER TRUST
Evidencing an undivided interest in a trust, the corpus of which consists
primarily of receivables generated from time to time in the ordinary course of
business in a portfolio of revolving credit card accounts by
FIRST DEPOSIT NATIONAL BANK
and
PROVIDIAN NATIONAL BANK
and, in certain circumstances, certain Additional Sellers (as defined in the
Pooling and Servicing Agreement referred to below).
------------
*Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
2
(Not an interest in or obligation of First Deposit
National Bank, Providian National Bank,
any Additional Sellers or any affiliate thereof)
3
This certifies that (the "Class B Certificateholder") is the
registered owner of a fractional undivided interest in certain assets of a trust
(the "Trust") created pursuant to the Pooling and Servicing Agreement dated as
of June 1, 1993 (as amended and supplemented, other than by any amendment or
supplement relating to a specific Series, the "Agreement"), as supplemented by
the Series 1997-2 Supplement dated as of March 1, 1997 (as amended and
supplemented, the "Series Supplement"), among First Deposit National Bank, a
national banking association, as Seller and Servicer, Providian National Bank, a
national banking association, as Seller, and Bankers Trust Company, a New York
banking corporation, as trustee (the "Trustee"). The Trust will also issue
$570,500,000 of Floating Rate Class A Asset Backed Certificates, Series 1997-2
which will be senior to the Class B Certificates and $63,000,000 of Collateral
Interest, Series 1997-2 which will be subordinated to the Class B Certificates,
all as described in the Series Supplement. The corpus of the Trust consists of
(i) a portfolio of all receivables (the "Receivables") existing in the revolving
credit card accounts and other revolving credit accounts identified under the
Agreement from time to time (the "Accounts"), (ii) all Receivables generated
under the Accounts from time to time thereafter, (iii) funds collected or to be
collected from accountholders in respect of the Receivables, (iv) all funds
which are from time to time on deposit in the Collection Account and in the
Series Accounts, (v) the benefits of certain Series Enhancements including a
Cash Collateral Account for the benefit of the Class A Certificateholders and
the Class B Certificateholders which will have an initial balance of
$21,000,000, (vi) if applicable, payments, if any, received under any interest
rate swap or cap agreement assigned to the Trust for the benefit of the Series
1997-2 Certificateholders and (vii) all other assets and interests constituting
the Trust. Although a summary of certain provisions of the Agreement and the
Series Supplement is set forth below and on the Summary of Terms and Conditions
attached hereto and made a part hereof, this Class B Certificate does not
purport to summarize the Agreement and the Series Supplement and reference is
made to the Agreement and the Series Supplement for information with respect to
the interests, rights, benefits, obligations, proceeds and duties evidenced
hereby and the rights, duties and obligations of the Trustee. A copy of the
Agreement and the Series Supplement (without schedules) may be requested from
the Trustee by writing to the Trustee at the Corporate Trust
4
Office. To the extent not defined herein, the capitalized terms used herein have
the meanings ascribed to them in the Agreement or the Series Supplement, as
applicable.
This Class B Certificate is issued under and is subject to the
terms, provisions and conditions of the Agreement and the Series Supplement, to
which Agreement and Series Supplement, each as amended and supplemented from
time to time, the Class B Certificateholder by virtue of the acceptance hereof
assents and is bound. It is the intent of the Sellers and the Series 1997-2
Certificateholders that, for Federal, state and local income and franchise tax
purposes only, the Series 1997-2 Certificates will qualify as indebtedness of
the Sellers secured by the Receivables. The Class B Certificateholder, by the
acceptance of this Class B Certificate, agrees to treat this Class B Certificate
for Federal, state and local income and franchise tax purposes as indebtedness
of the Sellers.
In general, payments of principal with respect to the Class B
Certificates are limited to the Class B Invested Amount, which may be less than
the unpaid principal balance of the Class B Certificates. The final principal
payment with respect to the Class B Certificates is scheduled to be made on the
May 2004 Distribution Date, but the final principal payment with respect to the
Class B Certificates may be paid earlier or later under certain circumstances
described in the Agreement and the Series Supplement. Principal payments with
respect to the Class B Certificates will not commence until the Class A Invested
Amount is paid in full.
The Class B Certificates may not be acquired by or for the
account of any employee benefit plan, trust or account, including an individual
retirement account, that is subject to Section 406 of the Employee Retirement
Income Security Act of 1974 or that is described in Section 4975(e)(1) of the
Internal Revenue Code of 1986 or an entity whose underlying assets include plan
assets by reason of a plan's investment in such entity (a "Benefit Plan"). By
accepting and holding this Certificate, the Holder hereof shall be deemed to
have represented and warranted that it is not a Benefit Plan. By acquiring any
interest in this Certificate, the applicable Certificate Owner or Owners shall
be deemed to have represented and warranted that it or they are not Benefit
Plans.
5
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee, by manual signature, this Class B
Certificate shall not be entitled to any benefit under the Agreement or the
Series Supplement or be valid for any purpose.
IN WITNESS WHEREOF, the Sellers have caused this Class B
Certificate to be duly executed.
FIRST DEPOSIT NATIONAL BANK,
By ___________________________
Name:
Title:
PROVIDIAN NATIONAL BANK,
By ___________________________
Name:
Title:
Dated: , 199
6
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates described in the within-mentioned
Agreement and Series Supplement.
BANKERS TRUST COMPANY,
as Trustee,
By: ____________________
Authorized Officer
or
By:
as Authenticating Agent
for the Trustee,
By: ____________________
Authorized Officer
7
PROVIDIAN MASTER TRUST
FLOATING RATE CLASS B ASSET BACKED CERTIFICATE
Series 1997-2
Summary of Terms and Conditions
This Class B Certificate is one of a Series of Certificates
entitled Providian Master Trust, Asset Backed Certificates, Series 1997-2 (the
"Series 1997-2 Certificates"), and one of a Class thereof entitled Floating Rate
Class B Asset Backed Certificates, Series 1997-2 (the "Class B Certificates"),
each of which represents a fractional undivided interest in certain assets of
the Trust. The Receivables consist of Principal Receivables which arise
generally from the purchase of merchandise and services and amounts advanced to
accountholders as cash advances and Finance Charge Receivables. The Trust Assets
are allocated in part to the certificateholders of all outstanding Series (the
"Certificateholders' Interest") with the remainder allocated to the Sellers. The
aggregate interest represented by the Class B Certificates at any time in the
Principal Receivables in the Trust shall not exceed an amount equal to the Class
B Invested Amount at such time. The Class B Initial Invested Amount is
$66,500,000. In addition to the Class B Certificates, the Floating Rate Class A
Asset Backed Certificates, Series 1997-2, the Collateral Interest, Series
1997-2, the Series 1997-1 Certificates, issued contemporaneously with the Series
1997-2 Certificates, and other Series of Investor Certificates previously issued
by the Trust, a Sellers' Certificate has been issued to the Sellers pursuant to
the Agreement which represents the Sellers' Interest.
Subject to the terms and conditions of the Agreement, the
Sellers may from time to time direct the Trustee, on behalf of the Trust, to
issue one or more new Series of Investor Certificates, which will represent
fractional undivided interests in certain of the Trust Assets.
On each Distribution Date, the Paying Agent shall distribute
to each Class B Certificateholder of record on the last business day of the
preceding calendar month (each a "Record Date") such Class B Certificateholder's
pro rata
8
share of such amounts on deposit in the Collection Account and the Principal
Funding Account as are payable to the Class B Certificateholders pursuant to the
Agreement and the Series Supplement. Distributions with respect to this Class B
Certificate will be made by the Paying Agent by check mailed to the address of
the Class B Certificateholder of record appearing in the Certificate Register
without the presentation or surrender of this Class B Certificate or the making
of any notation thereon (except for the final distribution in respect of this
Class B Certificate) except that with respect to Class B Certificates registered
in the name of Cede & Co., the nominee for The Depository Trust Company,
distributions will be made in the form of immediately available funds. Final
payment of this Class B Certificate will be made only upon presentation and
surrender of this Class B Certificate at the office or agency specified in the
notice of final distribution delivered by the Trustee to the Class B
Certificateholders in accordance with the Agreement and the Series Supplement.
On any day occurring on or after the day on which the Invested
Amount is reduced to 5% or less of the Initial Invested Amount, the Sellers have
the option to repurchase the Series 1997-2 Certificateholders' Interest in the
Trust. The repurchase price of the Class B Certificates will be equal to (a) if
such day is a Distribution Date, the Reassignment Amount for the day immediately
preceding such Distribution Date or (b) if such day is not a Distribution Date,
the Reassignment Amount for the day immediately preceding the Distribution Date
following such day; excluding, in each case, any portion of the Reassignment
Amount consisting of amounts payable to the Class A Certificateholders or the
Collateral Interest Holder. Following the deposit of such repurchase price in
the Collection Account, the Class B Certificateholders will not have any
interest in the Receivables and the Class B Certificates will represent only the
right to receive such repurchase price.
This Class B Certificate does not represent an obligation of,
or an interest in, the Sellers, the Servicer or any affiliate of any of them and
is not insured or guaranteed by the Federal Deposit Insurance Corporation or any
other governmental agency or instrumentality. This Class B Certificate is
limited in right of payment to certain Collections with respect to the
Receivables (and certain other amounts), all as more specifically set forth
hereinabove and in the Agreement and the Series Supplement.
9
The Agreement or any Supplement may, subject to certain
conditions, be amended by the Sellers, the Servicer and the Trustee without
Investor Certificateholder consent. The Trustee may, but shall not be obligated
to, enter into any such amendment which affects the Trustee's rights, duties or
immunities under the Agreement or otherwise.
The Agreement or any Supplement may also be amended from time
to time (including in connection with the issuance of a Supplemental
Certificate) by the Servicer, the Sellers and the Trustee, with the consent of
the Holders of Investor Certificates evidencing not less than 66-2/3% of the
aggregate unpaid principal amount of the Investor Certificates of all adversely
affected Series, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of the Agreement or any Supplement
or of modifying in any manner the rights of the Investor Certificateholders;
provided, however, that no such amendment shall (i) reduce in any manner the
amount of or delay the timing of any distributions to be made to Investor
Certificateholders or deposits of amounts to be so distributed or the total
amount of Series Enhancement available for the benefit of a Series without the
consent of each affected Investor Certificateholder (provided that any amendment
to the terms of a Pay Out Event shall not be deemed to be within the scope of
this clause (i)), (ii) change the definition of or the manner of calculating the
interest of any Investor Certificateholder without the consent of each affected
Investor Certificateholder, (iii) reduce the aforesaid percentage required to
consent to any such amendment without the consent of each Investor
Certificateholder or (iv) adversely affect the rating of any Series or Class by
each Rating Agency without the consent of the Holders of Investor Certificates
of such Series or Class evidencing not less than 66-2/3% of the aggregate unpaid
principal amount of the Investor Certificates of such Series or Class. The
Trustee may, but shall not be obligated to, enter into any such amendment which
affects the Trustee's rights, duties or immunities under this Agreement or
otherwise.
The Class B Certificates are issuable only in minimum
denominations of $1,000 and integral multiples of $1,000. The transfer of this
Class B Certificate shall be registered in the Certificate Register upon
surrender of this Class B Certificate for registration of transfer at any office
or agency maintained by the Transfer Agent and Registrar accompanied by a
written instrument of transfer,
10
in a form satisfactory to the Trustee or the Transfer Agent and Registrar, duly
executed by the Class B Certificateholder or such Class B Certificateholder's
attorney-in-fact, and duly authorized in writing with such signature guaranteed,
and thereupon one or more new Class B Certificates of authorized denominations
and for the same aggregate fractional undivided interest will be issued to the
designated transferee or transferees.
As provided in the Agreement and subject to certain
limitations therein set forth, Class B Certificates are exchangeable for new
Class B Certificates evidencing like aggregate fractional undivided interests as
requested by the Class B Certificateholder surrendering such Class B
Certificates. No service charge may be imposed for any such exchange but the
Servicer or Transfer Agent and Registrar may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
therewith.
The Servicer, the Trustee, the Paying Agent and the Transfer
Agent and Registrar and any agent of any of them, may treat the person in whose
name this Class B Certificate is registered as the owner hereof for all
purposes, and neither the Servicer nor the Trustee, the Paying Agent, the
Transfer Agent and Registrar, nor any agent of any of them, shall be affected by
notice to the contrary except in certain circumstances described in the
Agreement.
THIS CLASS B CERTIFICATE SHALL BE CONSTRUED IN ACCORDANCE WITH
THE LAWS OF 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.
11
ASSIGNMENT
Social Security or other identifying number of assignee
_____________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto _________________________________________________________________
________________________________________________________________________________
(name and address of assignee)
the within Certificate and all rights thereunder, and hereby irrevocably
constitutes and appoints _____________________ attorney-in-fact, to transfer
said Certificate on the books kept for registration thereof, with full power of
substitution in the premises.
Dated: _______________________*
Signature Guaranteed:
________________________
------------
(*) NOTE: The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Certificate in every
particular, without alteration, enlargement or any change whatsoever.
EXHIBIT B
MONTHLY PAYMENT INSTRUCTIONS AND
NOTIFICATION TO THE TRUSTEE
---------------------------------------------
PROVIDIAN MASTER TRUST
SERIES 1997-2
---------------------------------------------
The undersigned, a duly authorized representative of First Deposit
National Bank ("FDNB"), as Servicer pursuant to the Pooling and Servicing
Agreement dated as of June 1, 1993 (as amended and supplemented, the
"Agreement"), among FDNB, Providian National Bank ("PNB"), and Bankers Trust
Company, as trustee (the "Trustee"), does hereby certify as follows:
1. Capitalized terms used in this Certificate have their respective
meanings set forth in the Agreement or the Series 1997-2 Supplement dated as of
March 1, 1997 among FDNB, PNB and the Trustee (as amended and supplemented, the
"Series Supplement"), as applicable. This Certificate is delivered pursuant to
Section 4.03(a) of the Agreement and Sections 4.05(a), 4.09 and 4.10 of the
Series Supplement.
2. First Deposit is the Servicer.
3. The undersigned is a Servicing Officer.
I. Instructions to make a Withdrawal on the Distribution Date from the
Collection Account from Available Finance Charge Collections.
Pursuant to Section 4.03(a) of the Agreement and Section
4.05(a) of the Series Supplement, the Servicer does hereby instruct
the Trustee (i) to make a withdrawal from Available Finance Charge
Collections on deposit in the Collection Account on __________, which
date is a Distribution Date under the Agreement, in an aggregate
amount as set forth below in respect of the following amounts and (ii)
to apply the proceeds of such withdrawal in accordance with Section
4.05(a) of the Series Supplement:
A) Class A Monthly Interest (Section 4.05(a)(i) of the Series
Supplement)
(1) Class A Monthly Interest due on the Distribution
Date................................................$
(2) Class A Monthly Interest previously due but unpaid on
a prior Distribution Date...........................$
(3) Class A Additional Interest due on the Distribution
Date or Class A Additional Interest previously
due but unpaid on a prior Distribution
Date...............................................$
B) Class B Monthly Interest (Section 4.05(a)(ii) of the Series
Supplement)
(1) Class B Monthly Interest due on the Distribution
Date...............................................$
(2) Class B Monthly Interest previously due but unpaid on
a prior Distribution Date..........................$
(3) Class B Additional Interest due on the Distribution
Date or Class B Additional Interest previously due
but unpaid on a prior Distribution Date............$
C) Servicing Fee (Section 4.05(a)(iii) of the Series Supplement)
(1) Monthly Servicing Fee due on the Distribution Date
with respect to the Series 1997-2 Certificates
(unless such amount has been netted against
deposits to the Collection Account pursuant to
Section 4.03 of the Agreement).....................$
(2) Monthly Servicing Fee previously due but unpaid on
a prior Distribution Date with respect to the
Series 1997-2 Certificates (unless such amount
has been netted against deposits to the Collection
Account pursuant to Section 4.03 of the
Agreement).........................................$
D) Class A Defaulted Amount (Section 4.05(a)(iv) of the Series
Supplement)
(1) Class A Defaulted Amount for the Distribution Date
(unless such amount has been netted against
deposits to the Collection Account pursuant to
Section 4.03 of the Agreement)...................$
E) Reimbursement of Class A Charge-Offs (Section 4.05(a)(v) of
the Series Supplement)
(1) Unreimbursed Class A Charge-Offs..................$
F) Class B Subordinated Monthly Interest (Section 4.05(a)(vi)
of the Series Supplement)
(1) Class B Subordinated Monthly Interest due on the
Distribution Date.................................$
(2) Class B Subordinated Monthly Interest previously
due but unpaid on a prior Distribution Date.......$
(3) Class B Subordinated Additional Interest due on the
Distribution Date or Class B Subordinated
Additional Interest previously due but unpaid
on a prior Distribution Date......................$
G) Class B Defaulted Amount (Section 4.05(a)(vii) of the Series
Supplement)
(1) Class B Defaulted Amount for the Distribution Date
(unless such amount has been netted against
deposits to the Collection Account pursuant to
Section 4.03 of the Agreement)....................$
H) Reimbursement of Class B Invested Amount Reductions (Section
4.05(a)(viii) of the Series Supplement)
(1) Unreimbursed reductions in the Class B Invested
Amount on prior Distribution Dates................$
I) Collateral Monthly Interest (Section 4.05(a)(ix) of the Series
Supplement)
(1) Collateral Monthly Interest due on the Distribution
Date...............................................$
(2) Collateral Monthly Interest previously due but
unpaid on a prior Distribution Date................$
J) Collateral Defaulted Amount (Section 4.05(a)(x) of the
Series Supplement)
(1) Collateral Defaulted Amount for the Distribution Date
(unless such amount has been netted against
deposits to the Collection Account pursuant to
Section 4.03 of the Agreement).....................$
K) Required Reserve Account Amount, if applicable (Section
4.05(a)(xi) of the Series Supplement)
(1) On and after the Reserve Account Funding Date, if
any, the amount by which the Required Reserve
Account Amount exceeds the Available Reserve
Account Amount.....................................$
L) Reimbursement of Collateral Invested Amount Reductions
(Section 4.05 (a)(xii) of the Series Supplement)
(1) Unreimbursed reductions in the Collateral Invested
Amount on prior Distribution Dates.................$
M) Required Cash Collateral Amount (Section 4.05(a)(xiii) of
the Series Supplement)
(1) Amount by which the Required Cash Collateral Amount
exceeds the Available Cash Collateral Amount.......$
N) Other Collateral Interest Holder Payments (Section
4.05(a)(xiv) of the Series Supplement)
(1) Other amounts due the Collateral Interest Holder
pursuant to the Collateral Agreement...............$
O) Additional Finance Charges (Section 4.05(a)(xv) of the
Series Supplement)
(1) Additional Finance Charges allocated to other
Series.............................................$
(2) Additional Finance Charges payable to the
Sellers............................................$
II. Instructions to Make Withdrawals from the Cash Collateral Account
Pursuant to Section 4.10 of the Series Supplement, the
Servicer does hereby instruct the Trustee (i) to make a withdrawal
from the Cash Collateral Account on ____________, which date is a
Distribution Date under the Agreement, in an aggregate amount as set
forth below in respect of the following amounts, and (ii) to apply the
proceeds of such withdrawal in accordance with Section 4.10(b), (c) or
(d), as applicable, of the Series Supplement:
A) Pursuant to Section 4.10(b) of the Series Supplement
(1) Cash Collateral Investment Proceeds on deposit in the
Cash Collateral Account (to be deposited in the
Collection Account and treated as Available Finance
Charge Collections)................................$
B) Pursuant to Section 4.10(c) of the Series Supplement
(1) Required Draw Amount (to be deposited in the
Collection Account)................................$
C) Pursuant to Section 4.10(d) of the Series Supplement
(1) The Cash Collateral Account Surplus Amount (to be
distributed to the Collateral Interest Holder on the
Distribution Date for application in accordance with
the Collateral Agreement)..........................$
III. Instructions to Make a Withdrawal from the Collection Account from
Reallocated Principal Collections
Pursuant to Section 4.03(a) of the Agreement and Sections
4.05(b) and (c) of the Series Supplement, the Servicer does hereby
instruct the Trustee (i) to make a withdrawal from Reallocated
Principal Collections on deposit in the Collection Account on
___________, which date is a Distribution Date under the Agreement, in
an aggregate amount as set forth below and (ii) to apply the proceeds
of such withdrawal in accordance with Sections 4.05(b) and (c) of the
Series Supplement.
A) Reallocated Collateral Principal Collections (Section 4.05(b)
of the Series Supplement)
(1) Amount of Reallocated Collateral Principal
Collections used to fund any deficiency in items
I(A), I(B), I(C), I(D) and I(G) on such Distribution
Date...............................................$
B) Reallocated Class B Principal Collections (Section 4.05(c) of
the Series Supplement)
(1) Amount of Reallocated Class B Principal Collections
used to fund any deficiency in items I(A), I(C) and
I(D) on such Distribution Date....................$
IV. Instructions to make a Withdrawal from the Collection Account from
Available Principal Collections during the Revolving Period.
Pursuant to Section 4.03(a) of the Agreement and Section
4.05(d) of the Series Supplement, the Servicer does hereby instruct
the Trustee (i) to make a withdrawal from Available Principal
Collections on deposit in the Collection Account on ____________,
which date is a Distribution Date under the Agreement, in an aggregate
amount as set forth below in respect of the following amounts and (ii)
to apply the proceeds of such withdrawal in accordance with Section
4.05(d) of the Series Supplement:
A) Collateral Monthly Principal during the Revolving Period
(Section 4.05(d)(i) of the Series Supplement)
(1) Collateral Monthly Principal, if any, on the
Distribution Date..................................$
B) Shared Principal Collections during the Revolving Period
(Section 4.05(d)(ii) of the Series Supplement)
(1) Shared Principal Collections allocated to other
Series ............................................$
(2) Shared Principal Collections to be deposited in the
Special Funding Account............................$
(3) Shared Principal Collections payable to the
Sellers............................................$
V. Instructions to make a Withdrawal on the Distribution Date from the
Collection Account from Available Principal Collections during the
Accumulation Period or Early Amortization Period.
Pursuant to Section 4.03(a) of the Agreement and Section
4.05(e) of the Series Supplement, the Servicer does hereby instruct
the Trustee (i) to make a withdrawal from Available Principal
Collections on deposit in the Collection Account on ____________,
which date is a Distribution Date under the Agreement, in an aggregate
amount as set forth below in respect of the following amounts and (ii)
to apply the proceeds of such withdrawal in accordance with Section
4.05(e) of the Series Supplement:
A) Class A Monthly Principal (Section 4.05(e)(i) of the Series
Supplement)
(1) Class A Monthly Principal to be deposited in the
Principal Funding Account on the Distribution
Date...............................................$
B) Class B Monthly Principal (Section 4.05(e)(ii) of the Series
Supplement)
(1) Class B Monthly Principal to be deposited in the
Principal Funding Account on the Distribution
Date...............................................$
C) Collateral Monthly Principal (Section 4.05(e)(iii)
of the Series Supplement)
(1) Collateral Monthly Principal, if any, for such
Distribution Date ................................$
D) Shared Principal Collections (Section 4.05(e)(iv) of the
Series Supplement)
(1) Shared Principal Collections allocated to other
Series.............................................$
(2) Shared Principal Collections to be deposited in the
Special Funding Account............................$
(3) Shared Principal Collections payable to the
Sellers............................................$
VI. Instructions to make Withdrawals from the Reserve Account.
Pursuant to Section 4.09 of the Series Supplement, the
Servicer does hereby instruct the Trustee (i) to make a withdrawal
from the Reserve Account pursuant to
Section 4.09(d) of the Series Supplement on __________, which date is
a Transfer Date under the Agreement, and (ii) to apply the proceeds of
such withdrawal in accordance with Sections 4.09(b), (d) or (e), as
applicable, of the Series Supplement:
A) Pursuant to Section 4.09(d) of the Series Supplement
(1) Reserve Draw Amount (to be deposited in the
Collection Account on the Transfer Date)...........$
B) Pursuant to Sections 4.09(b) and (e) of the Series Supplement
(1) Reserve Account Surplus and investment earnings on
the Reserve Account (to be distributed to the
Collateral Interest Holder for application in
accordance with the Collateral Agreement)..........$
VII. Instructions to make Withdrawals from the Principal Funding Account
Pursuant to Section 4.03(c) of the Series Supplement, the
Servicer does hereby instruct the Trustee (i) to make a withdrawal
from the Principal Funding Account pursuant to Section 4.03(c) of the
Series Supplement on _________, which date is a Distribution Date
under the Agreement, and (ii) to deposit the proceeds of such
withdrawal in the Collection Account in accordance with Section
4.03(c) of the Series Supplement:
A) Pursuant to Section 4.03(c) of the Series Supplement
(1) Principal Funding Investment Proceeds on deposit in
the Principal Funding Account (to be deposited in
the Collection Account and treated as Available
Finance Charge Collections)........................$
VIII. Accrued and Unpaid Amounts.
After giving effect to the withdrawals, deposits and
distributions to be made in accordance with this Certificate, the
following amounts will be accrued and unpaid on the __________
Distribution Date with respect to the Series 1997-2 Certificates:
A) Monthly Interest
(1) The aggregate amount of all due but unpaid Class A
Monthly Interest...................................$
(2) The aggregate amount of all due but unpaid Class B
Monthly Interest...................................$
(3) The aggregate amount of all due but unpaid Collateral
Monthly Interest...................................$
B) Monthly Servicing Fee
(1) The aggregate amount of all due but unpaid Monthly
Servicing Fees with respect to the Series 1997-2
Certificates.......................................$
C) Defaulted Amounts
(1) The aggregate amount of all unreimbursed Class A
Charge-Offs.......................................$
(2) The aggregate amount of all unreimbursed reductions
in the Class B Invested Amount....................$
(3) The aggregate amount of all unreimbursed reductions
in the Collateral Invested
Amount............................................$
IX. Amounts to be Applied in Accordance with the Collateral Agreement.
Pursuant to Section 2.10(b) of the Collateral Agreement, the
Servicer does hereby instruct the Trustee on ___________, which date
is a Distribution Date under the Agreement, to distribute the amounts
specified in I(I), I(N), II(C), IV(A), V(C) and
VI(B) above, plus other amounts available under the Collateral
Agreement, to the persons or accounts set forth below.
A) Interest on the Collateral Interest (Sections 2.03 and 2.10(a)
of the Collateral Agreement)
(1) Interest on the Collateral Amount at the Collateral
Interest Rate for the applicable Interest Period
(pursuant to Section 2.10(a)(i) of the Collateral
Agreement).........................................$
(2) Interest on the amount by which the outstanding
principal balance of the Collateral Interest exceeds
the Collateral Invested Amount, at the Prime Rate for
the applicable Interest Period plus the Loan Margin
(pursuant to Section 2.03(a)(ii) of the Collateral
Agreement).........................................$
(3) Due but unpaid interest on the Collateral Interest
from prior Distribution Dates (pursuant to Section
2.03(c) of the Collateral Agreement)...............$
B) All other amounts payable to the Collateral Interest Holder
from Available Non-Principal Funds pursuant to the Collateral
Agreement (including Sections 2.06, 2.07 and 2.09) (pursuant
to Section 2.10(a)(ii) of the Collateral Agreement).........$
C) Amount to be deposited into the Spread Account (pursuant to
Section 2.10(a)(iii) of the Collateral Agreement)...........$
D) Amount payable to the Sellers (pursuant to Section 2.10(a)(iv)
of the Collateral Agreement)................................$
E) All amounts payable to the Collateral Interest Holder from
Available Principal Funds pursuant to the Collateral Agreement
(pursuant to Section 2.10(b) of the Collateral
Agreement)..................................................$
IN WITNESS WHEREOF, the undersigned has duly executed this
certificate this __th day of ___________.
FIRST DEPOSIT NATIONAL BANK,
Servicer
By: _________________________________
Name:
Title:
EXHIBIT C
MONTHLY STATEMENT
---------------------------------------------
PROVIDIAN MASTER TRUST
SERIES 1997-2
---------------------------------------------
Pursuant to the Pooling and Servicing Agreement dated as of
June 1, 1993 (as amended and supplemented, the "Agreement"), as supplemented by
the Series 1997-2 Supplement dated March 1, 1997 (as amended and supplemented,
the "Series Supplement"), among First Deposit National Bank ("FDNB"), Seller
and Servicer, Providian National Bank, Seller, and Bankers Trust Company,
Trustee, FDNB as Servicer is required to prepare certain information each month
regarding current distributions to Class A Certificateholders, Class B
Certificateholders and the Collateral Interest Holder and the performance of
the Providian Master Trust (the "Trust") during the previous month. The
information which is required to be prepared for the Series 1997-2 Certificates
with respect to the Distribution Date occurring on ______________, and with
respect to the performance of the Trust during the month of ______________ is
set forth below. Certain of the information is presented on the basis of an
original principal amount of $1,000 per Investor Certificate. Certain other
information is presented based on the aggregate amounts for the Trust as a
whole. Capitalized terms used in this Certificate have their respective
meanings set forth in the Agreement or Series Supplement, as applicable.
A) Information Regarding the Current Monthly Distribution for
the Series 1997-2 Class A Certificates and Class B
Certificates (stated on the basis of $1,000 original
certificate principal amount)
(1) The total amount distributed to Class A
Certificateholders per $1,000 original certificate
principal amount.................................. $
(2) The amount set forth in A(1) above
distributed to Class A Certificateholders with
respect to interest per $1,000 original certificate
principal amount................................... $
(3) The amount set forth in A(1) above distributed to
Class A Certificateholders with respect to principal
per $1,000 original certificate principal
amount............................................. $
(4) The total amount distributed to Class B
Certificateholders per $1,000 original certificate
principal amount................................... $
(5) The amount set forth in A(4) above distributed to
Class B Certificateholders with respect to interest
per $1,000 original certificate principal
amount............................................. $
(6) The amount set forth in A(4) above distributed to
Class B Certificateholders with respect to principal
per $1,000 original certificate principal
amount............................................. $
B) Information Regarding the Performance of the Trust
(1) Allocation of Receivables Collections to the Series
1997-2 Certificates
(a) The aggregate amount of Finance Charge
Receivables collected during the Monthly
Period immediately preceding the
Distribution Date......................... $
(b) The aggregate amount of Interchange
collected and allocated to the Trust for
the Monthly Period immediately preceding the
Distribution Date......................... $
(c) The aggregate amount of Principal
Receivables collected during the Monthly
Period immediately preceding the
Distribution Date......................... $
(d) The Floating Allocation Percentage with
respect to the Series 1997-2 Certificates
for the Monthly Period immediately preceding
the Distribution Date..................... %
(e) The Principal Allocation Percentage with
respect to the Series 1997-2 Certificates
for the Monthly Period immediately
preceding the Distribution Date........... %
(f) The Finance Charge Receivables and
Interchange collected and allocated to the
Series 1997-2 Certificates for the Monthly
Period immediately preceding the
Distribution Date......................... $
(g) The Principal Receivables collected and
allocated to the Series 1997-2
Certificates for the Monthly Period
immediately preceding the Distribution
Date.................................... $
(2) Available Finance Charge Collections, Required Draw
Amount and Reallocated Principal Collections for
Series 1997-2 for the Monthly Period immediately
preceding the Distribution Date................... $
(a) The Finance Charge Receivables and
Interchange collected and allocated to the
Series 1997-2 Certificates............... $
(b) Collection Account and Special Funding
Account investment earnings allocated to
the Series 1997-2 Certificates............ $
(c) Principal Funding Account Investment
Proceeds................................. $
(d) Cash Collateral Account Investment
Proceeds................................. $
(e) Reserve Draw Amount, if applicable....... $
(f) Additional Finance Charges from other
Series allocated to the Series 1997-2
Certificates............................. $
(g) Payments, if any, on deposit as of the
Determination Date received from any
Interest Rate Protection Agreements...... $
(h) Required Draw Amount, if applicable...... $
(i) Reallocated Collateral Principal
Collections.............................. $
(j) Reallocated Class B Principal
Collections.............................. $
(k) Total Available Finance Charge Collections
and Reallocated Principal Collections for
Series 1997-2 (total of (a), (b), (c), (d),
(e), (f), (g), (h), (i) and (j) above)... $
(3) Available Principal Collections for Series 1997-2
for the Monthly Period immediately preceding the
Distribution Date
(a) The Principal Receivables collected and
allocated to the Series 1997-2
Certificates............................. $
(b) Shared Principal Collections from other
Series allocated to the Series 1997-2
Certificates............................. $
(c) Additional amounts to be treated as
Available Principal Collections
pursuant to the Series Supplement........ $
(d) Reallocated Collateral Principal
Collections.............................. $
(e) Reallocated Class B Principal
Collections.............................. $
(f) Available Principal Collections for Series
1997-2 (total of (a), (b) and (c) minus
(d) and (e) above)....................... $
(4) Delinquent Balances in the Trust
The aggregate outstanding balance of the Accounts
which were delinquent as of the close of business on
the last day of the Monthly Period immediately
preceding the Distribution Date.
(a) 31-60 days $
(b) 61-90 days
(c) 91 or more days _____________
(d) Total Delinquencies $
(5) Defaulted Amount
(a) The aggregate amount of Defaulted
Receivables with respect to the Trust for
the Monthly Period immediately preceding the
Distribution Date........................ $
(b) The aggregate Amount of Recoveries of
Defaulted Receivables processed during the
Monthly Period immediately preceding the
Distribution Date........................ $
(c) The Defaulted Amount for the Monthly Period
immediately preceding the Distribution Date
[Defaulted Receivables minus
Recoveries].............................. $
(d) The Defaulted Amount for the Monthly Period
immediately preceding the Distribution Date
allocable to the Series 1997-2 Certificates
(the "Series 1997-2 Defaulted Amount")... $
(e) The Class A Defaulted Amount [Series 1997-2
Defaulted Amount multiplied by the Class A
Percentage].............................. $
(f) The Class B Defaulted Amount [Series 1997-2
Defaulted Amount multiplied by the Class B
Percentage].............................. $
(6) Class A Charge-Offs
(a) The excess, if any, of the Class A
Defaulted Amount over the sum of (i)
Available Finance Charge Collections applied
to such Class A Defaulted Amount, (ii) the
Available Cash Collateral Amount applied to
such Class A Defaulted Amount, (iii)
Reallocated Principal Collections applied to
such Class A Defaulted Amount, (iv) the
amount by which the Collateral Invested
Amount has been reduced in respect of such
Class A Defaulted Amount and (v) the amount
by which the Class B Invested Amount has
been reduced in respect of such Class A
Defaulted Amount (a "Class A Charge-
Off").................................... $
(b) The amount of the Class A Charge-Off set
forth in item 6(a) above, per $1,000
original certificate principal amount (which
will have the effect of reducing, pro rata,
the amount of each Class A
Certificateholder's investment).......... $
(c) The total amount reimbursed on the
Distribution Date in respect of Class A
Charge-Offs for prior Distribution
Dates.................................... $
(d) The amount set forth in item 6(c)
above per $1,000 original certificate
principal amount (which will have the effect
of increasing, pro rata, the amount of each
Class A Certificateholder's investment).. $
(e) The amount, if any, by which the
outstanding principal balance of the Class A
Certificates exceeds the Class A Invested
Amount if any, as of the Distribution Date,
after giving effect to all deposits,
withdrawals and distributions on such
Distribution Date........................ $
(7) Class B Charge-Offs
(a) The excess, if any, of the Class B
Defaulted Amount over the sum of (i)
Available Finance Charge Collections
applied to such Class B Defaulted Amount
applied to such Class B Defaulted Amount,
(ii) the Available Cash Collateral Amount,
(iii) Reallocated Collateral Principal
Collections applied to such Class B
Defaulted Amount and (iv) the amount by
which the Collateral Invested Amount has
been reduced in respect of such Class B
Defaulted Amount......................... $
(b) The amount by which the Class B Invested
Amount has been reduced on the Distribution
Date in respect of Reallocated Class B
Principal Collections.................... $
(c) The amount by which the Class B Invested
Amount has been reduced on the Distribution
Date in respect of item 6(a) (together with
item 7(a), "Class B Charge-Offs")........ $
(d) The total amount by which the Class B
Invested Amount has been reduced on the
Distribution Date as set forth in items
7(a), (b) and (c)........................ $
(e) The amount set forth in item 7(d) above
per $1,000 original certificate principal
amount (which will have the effect of
reducing, pro rata, the amount of each Class
B Certificateholder's investment)........ $
(f) The total amount reimbursed on the
Distribution Date in respect of reductions
in the Class B Invested Amount on prior
Distribution Dates....................... $
(g) The amount set forth in item 7(f) above
per $1,000 original certificate principal
amount (which will have the effect of
increasing, pro rata, the amount of each
Class B Certificateholder's
investment).............................. $
(h) The amount, if any, by which the
outstanding principal balance of the Class B
Certificates exceeds the Class B Invested
Amount if any, as of the Distribution Date,
after giving effect to all deposits,
withdrawals and distributions on such
Distribution Date........................ $
(8) Reductions in the Collateral Interest
(a) The excess, if any, of the Collateral
Defaulted Amount over Available Finance
Charge Collections applied to such
Collateral Defaulted Amount.............. $
(b) The amount by which the Collateral
Invested Amount has been reduced on the
Distribution Date in respect of Reallocated
Principal Collections.................... $
(c) The amount by which the Collateral
Invested Amount has been reduced on the
Distribution Date in respect of items 6(a)
and 7(a) above........................... $
(d) The total amount by which the Collateral
Invested Amount has been reduced on the
Distribution Date as set forth in items
8(a), (b) and (c)........................ $
(e) The total amount reimbursed on the
Distribution Date in respect of
reductions in the Collateral Invested
Amount on prior Distribution Dates....... $
(f) The amount, if any, by which the
outstanding principal balance of the
Collateral Interest exceeds the Collateral
Invested Amount, if any, as of the
Distribution Date, after giving effect to
all deposits, withdrawals and distributions
on the Distribution Date................. $
(9) Investor Monthly Servicing Fee
(a) The amount of the Series 1997-2 Monthly
Servicing Fee payable to the Servicer on the
Distribution Date........................ $
(10) Cash Collateral Account
(a) The Available Cash Collateral Amount on
the Distribution Date, after giving effect
to all deposits, withdrawals and
distributions on such Distribution
Date..................................... $
(11) Class A Monthly Interest
(a) Class A Monthly Interest payable on the
Distribution Date........................ $
(12) Class B Monthly Interest
(a) Class B Monthly Interest payable on the
Distribution Date........................ $
(13) Principal Funding Account Amount
(a) The amount on deposit in the Principal Fund
Account on the Distribution Date, after
giving effect to all deposits, withdrawals
and distributions on such Distribution
Date..................................... $
(b) Deposits to the Principal Funding Account
are currently scheduled to commence on the
Distribution Date occurring in
______________. (The initial funding date
for the Principal Funding Account may be
modified in certain circumstances in
accordance with the terms of the Series
Supplement.)
(14) Deficit Controlled Accumulation Amount
The Deficit Controlled Accumulation Amount for the
Distribution Date, after giving effect to all
deposits, withdrawals and distributions on such
Distribution Date................................. $
(15) Reserve Account (if applicable)
(a) The amount on deposit in the Reserve
Account, if funded, on the Distribution
Date, after giving effect to all deposits,
withdrawals and distributions on such
Distribution Date and the related Transfer
Date..................................... $
(b) The Required Reserve Account Amount, if
any, selected by the Servicer............ $
C) Class A Invested Amount
(1) The Class A Initial Invested Amount............... $
(2) The Class A Invested Amount on the Distribution
Date, after giving effect to all deposits,
withdrawals and distributions on such Distribution
Date.............................................. $
(3) The Pool Factor for the Distribution Date (which
represents the ratio of the Class A Invested Amount,
as of such Distribution Date, after giving effect to
any adjustment in the Class A Invested Amount on such
Distribution Date, to the Class A Initial Invested
Amount). The amount of a Class A Certificateholder's
pro rata share of the Class A Invested Amount can be
determined by multiplying the original denomination
of the Class A Certificateholder's Certificate by the
Pool Factor.......................................
D) Class B Invested Amount
(1) The Class B Initial Invested Amount............... $
(2) The Class B Invested Amount on the Distribution
Date, after giving effect to all deposits,
withdrawals and distributions on such Distribution
Date.............................................. $
(3) The Pool Factor for the Distribution Date (which
represents the ratio of the Class B Invested Amount,
as of such Distribution Date, after giving effect to
any adjustment in the Class B Invested Amount on such
Distribution Date, to the Class B Initial Invested
Amount). The amount of a Class B Certificateholder's
pro rata share of the Class B Invested Amount can be
determined by multiplying the original denomination
of the Class B Certificateholder's Certificate by the
Pool Factor....................................... %
E) Collateral Invested Amount
(1) The Collateral Initial Invested Amount............ $
(2) The Collateral Invested Amount on the Distribution
Date, after giving effect to all deposits,
withdrawals and distributions on such Distribution
Date.............................................. $
(3) The Collateral Invested Amount as a percentage of
the sum of the Invested Amount on such Distribution
Date.............................................. %
F) Receivables Balances
(1) The aggregate amount of Principal Receivables in the
Trust at the close of business on the last day of the
immediately preceding Monthly Period.............. $
(2) The aggregate amount of Finance Charge Receivables
in the Trust at the close of business on the last day
of the immediately preceding Monthly Period....... $
G) Annualized Percentages
(1) The Gross Yield (Available Finance Charge
Collections for the Series 1997-2 Certificates for
the preceding Monthly Period (excluding payments
received from Interest Rate Protection Agreements)
divided by the Invested Amount of the Series 1997-2
Certificates as of the last day of the next preceding
Monthly Period, multiplied by 12)................. %
(2) The Net Loss Rate (the Series 1997-2 Defaulted
Amount for the preceding Monthly Period divided by
the Invested Amount of the Series 1997-2 Certificates
as of the last day of the next preceding Monthly
Period, multiplied by 12)......................... %
(3) The Portfolio Yield (the Gross Yield minus the Net
Loss Rate for the Series 1997-2 Certificates for the
preceding Monthly Period)......................... %
(4) The Base Rate (Monthly Interest plus Monthly
Servicing Fee (based on an assumed Servicing Fee Rate
of 2% per annum) for the preceding Monthly Period
with respect to the related Distribution Date,
divided by the Invested Amount of the Series 1997-2
Certificates as of the last day of the next preceding
Monthly Period, multiplied by 12)................ %
(5) The Net Spread (the Portfolio Yield minus the Base
Rate for the Series 1997-2 Certificates for the
preceding Monthly Period)......................... %
(6) The Monthly Payment Rate (Collections of Principal
Receivables and Finance Charge Receivables with
respect to all Receivables in the Trust for the
preceding Monthly Period divided by the amount of
Receivables in the Trust as of the last day of the
next preceding Monthly Period).................... %
H) Series 1997-2 Information for the Last Three Distribution
Dates
1) Gross Yield
a) / / %
b) / / %
c) / / %
2) Net Loss Rate
a) / / %
b) / / %
c) / / %
3) Net Spread (Portfolio Yield Minus Base Rate)
a) / / %
b) / / %
c) / / %
Three Month Average %
4) Monthly Payment Rate
a) / / %
b) / / %
c) / / %
FIRST DEPOSIT NATIONAL BANK
Servicer
By: _________________________________
Name:
Title:
EXHIBIT D
MONTHLY SERVICER'S CERTIFICATE
---------------------------------------------
PROVIDIAN MASTER TRUST
SERIES 1997-2
---------------------------------------------
The undersigned, a duly authorized representative of First Deposit
National Bank ("FDNB"), as Servicer pursuant to the Pooling and Servicing
Agreement dated as of June 1, 1993 (as amended and supplemented, the
"Agreement"), as supplemented by the Series 1997-2 Supplement dated as of March
1, 1997 (the "Series Supplement"), among FDNB, as Seller and Servicer, Providian
National Bank, as Seller, and Bankers Trust Company, as Trustee, does hereby
certify as follows:
1. Capitalized terms used in this Certificate have their respective
meanings set forth in the Agreement or Series Supplement, as
applicable.
2. FDNB is, as of the date hereof, the Servicer under the Agreement.
3. The undersigned is a Servicing Officer.
4. This Certificate relates to the Distribution Date occurring on
____________.
5. As of the date hereof, to the best knowledge of the undersigned, the
Servicer has performed in all material respects all its obligations
under the Agreement through the Monthly Period preceding such
Distribution Date [or, if there has been a default in the performance
of any such obligation, set forth in detail (i) the nature of such
default, (ii) the action taken by the Sellers and the Servicer, if
any, to remedy such default and (iii) the current status of each such
default].
6. As of the date hereof, to the best knowledge of the undersigned, no
Pay Out Event occurred on or prior to such Distribution Date.
7. As of the date hereof, to the best knowledge of the undersigned, no
Lien has been placed on any of the Receivables other than pursuant to
the Agreement [or, if there is a Lien, such Lien consist of
________________].
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this Certificate this __th day of ____________-.
FIRST DEPOSIT NATIONAL BANK,
Servicer
By: _______________________________
Name:
Title:
EXHIBIT E
NOTIFICATION TO THE TRUSTEE AND THE SELLERS OF A WITHDRAWAL FROM
THE CASH COLLATERAL ACCOUNT
---------------------------------------------
PROVIDIAN MASTER TRUST
SERIES 1997-2
---------------------------------------------
The undersigned, a duly authorized representative of First Deposit
National Bank ("FDNB"), as Servicer pursuant to the Pooling and Servicing
Agreement dated as of June 1, 1993 (as amended and supplemented, the
"Agreement"), as supplemented by the Series 1997-2 Supplement dated as of March
1, 1997 (the "Series Supplement"), among FDNB, as Seller and Servicer,
Providian National Bank, as Seller, and Bankers Trust Company, as Trustee, does
hereby certify as follows:
1. Capitalized terms used in this Certificate have their respective
meanings set forth in the Agreement or Series Supplement, as
applicable.
2. FDNB is, as of the date hereof, the Servicer under the Agreement.
3. The undersigned is a Servicing Officer.
4. This Certificate relates to the Distribution Date occurring on
____________.
5. Pursuant to Section 4.10 of the Series Supplement, the Servicer does
hereby instruct the Trustee to make a withdrawal from the Cash
Collateral Account on [ ], 199 , in an aggregate amount as set forth
below and to apply the proceeds of such withdrawal in accordance with
Section 4.10 of the Series Supplement.
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this Certificate this __th day of ____________-.
FIRST DEPOSIT NATIONAL BANK,
Servicer
By:
---------------------------------
Name:
Title:
SCHEDULE I
Designated Dealers
Credit Suisse First Boston Corporation
Chase Securities Inc.
Xxxxxx Brothers Inc.
Citicorp Securities, Inc.
SBCI Swiss Bank Corporation Investment banking Inc.
UBS Securities Inc.
Bear, Xxxxxxx & Co. Inc.
Salomon Brothers Inc
Daiwa Securities America Inc.
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxxxx Xxxxxx Inc.
Credit Lyonnais Securities (USA) Inc.
Xxxxxx Xxxxxxx & Co. Incorporated
NationsBank Capital Markets, Inc.
Prudential Securities Incorporated
Xxxxxxx, Xxxxx & Co.
