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EXHIBIT 10.1.9
SERIES 1997-1 SUPPLEMENT, dated as of November 25, 1997 (this
"Supplement"), by and among CHARMING SHOPPES RECEIVABLES CORP., a Delaware
corporation, as Seller (the "Seller"), SPIRIT OF AMERICA NATIONAL BANK, a
national banking association, as Servicer (the "Servicer"), and FIRST UNION
NATIONAL BANK, as Trustee (the "Trustee") under the Second Amended and Restated
Pooling and Servicing Agreement dated as of November 25, 1997 among the Seller,
the Servicer and the Trustee (as amended from time to time, the "Agreement").
Section 6.9 of the Agreement provides, among other things, that
the Seller, the Servicer and the Trustee may at any time and from time to time
enter into a supplement to the Agreement for the purpose of authorizing the
delivery by the Trustee to the Seller for the execution and redelivery to the
Trustee for authentication of one or more Series of Certificates.
Pursuant to this Supplement, the Seller and the Trustee shall
create a new Series of Investor Certificates and shall specify the Principal
Terms thereof.
SECTION 0.0.1. DESIGNATION.
0.0.1.1. There is hereby created a Series of Investor Certificates
to be issued in four classes pursuant to the Agreement and this Series
Supplement and to be known together as the "Series 1997-1
Certificates." The four classes shall be designated the Class A
Floating Rate Asset Backed Certificates, Series 1997-1 (the "Class A
Certificates"), the Class B Floating Rate Asset Backed Certificates,
Series 1997-1 (the "Class B Certificates"), the Class C Floating Rate
Asset Backed Certificates, Series 1997-1 (the "Class C Certificates")
and the Class D Floating Rate Asset Backed Certificates, Series 1997-1
(the "Class D Certificates"). The Class A Certificates, the Class B
Certificates, the Class C Certificates and the Class D Certificate
shall be substantially in the form of Exhibits X-0, X-0, X-0 and A-4
hereto, respectively.
0.0.1.2. Series 1997-1 shall be included in Group One. Series
1997-1 shall not be subordinated to any other Series.
SECTION 0.0.2. Definitions. In the event that any term or
provision contained herein shall conflict with or be inconsistent with
any provision contained in the Agreement, the terms and provisions of
this Supplement shall govern with respect to this Series. All Article,
Section or subsection references herein shall mean Article, Section or
subsections of the Agreement, except as otherwise provided herein. All
capitalized terms not otherwise defined herein are defined in the
Agreement. Each capitalized term defined herein shall relate only to
the Series 1997-1 Certificates and no other Series of Certificates or
Receivables Purchase Series issued by the Trust.
"Accumulation Period" shall mean, unless an Early Amortization
Event shall have occurred prior thereto, the period commencing on the date
specified by the Seller pursuant to subsection 4.17(d) and ending upon the first
to occur of (a) the commencement of the Early Amortization Period and (b) the
Series 1997-1 Termination Date.
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"Accumulation Period Length" shall have the meaning specified in
subsection 4.17(d).
"Adjusted Investor Interest" shall mean, with respect to any date
of determination, an amount equal to the sum of (a) the Class A Adjusted
Investor Interest, (b) the Class B Investor Interest, (c) the Class C Investor
Interest and (d) the Class D Investor Interest for such date.
"Amortization Period" shall not be applicable to this Supplement.
"Available Funds" shall mean, with respect to any Distribution
Date, the sum of Class A Available Funds, Class B Available Funds, Class C
Available Funds and Class D Available Funds, in each case for such Distribution
Date.
"Available Principal Collections" shall mean, with respect to any
Distribution Date, the sum of (a) the Principal Allocation Percentage of all
Collections of Principal Receivables for the related Due Period, minus the
amount of Reallocated Class D Principal Collections, Reallocated Class C
Principal Collections and Reallocated Class B Principal Collections with respect
to such Due Period which pursuant to Section 4.12 are required to fund the Class
A Required Amount, the Class B Required Amount and the Class C Required Amount,
(b) any Shared Principal Collections with respect to other Series in Group One
that are allocated to Series 1997-1 in accordance with Section 4.15 for such
Distribution Date, (c) any other amounts which pursuant to Section 4.9 and
4.11(a) (to the extent allocable to the Class A Investor Loss Amount), (b), (d),
(g), (h), (n) and (o) for such Due Period (other than such amounts paid from
Reallocated Principal Collections) are to be treated as Available Principal
Collections for such Distribution Date and (d) any amounts withdrawn from the
Series Excess Funding Account pursuant to subsection 4.21(d) for such
Distribution Date.
"Available Series Excess Funding Reserve Account Amount" shall
mean, with respect to any Distribution Date, the lesser of (a) the amount on
deposit in the Series Excess Funding Reserve Account (before giving effect to
any deposit to be made to the Series Excess Funding Reserve Account on such
date) and (b) the Series Excess Funding Reserve Account Required Amount for such
Distribution Date.
"Average Principal Balance" shall mean, for a Due Period in which
an Addition Date or Removal Date occurs, the weighted average of the Principal
Receivables in the Trust at the end of the day on the last day of the prior Due
Period and the Principal Receivables in the Trust at the end of the day on the
related Addition Date or Removal Date, weighted, respectively, by a fraction,
the numerator of which is the number of days from and including the first day of
such Due Period to but excluding the related Addition Date or Removal Date, and
the denominator of which is the number of days in such Due Period, and by a
fraction, the numerator of which is the number of days from and including the
related Addition Date or Removal Date to and including the last day of such Due
Period, and the denominator of which is the number of days in such Due Period.
"Base Rate" shall mean, for any Due Period, (a) the sum of Monthly
Interest for the related Distribution Date and the Investor Monthly Servicing
Fee for such Due Period,
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divided by (b) the sum of (i) the Series Investor Interest and (ii) the Series
Excess Funding Account Balance, in each case as of the last day of the prior Due
Period, times (c) 12.
"Certificateholder Servicing Fee" shall have the meaning specified
in Section 3.
"Class" shall mean any of the Class A Investor Interest, the Class
B Investor Interest, the Class C Investor Interest or the Class D Investor
Interest.
"Class A Additional Interest" shall have the meaning specified in
subsection 4.6(a).
"Class A Adjusted Investor Interest" shall mean, with respect to
any date of determination, an amount equal to the Class A Investor Interest
minus the Principal Funding Account Balance on such date of determination.
"Class A Allocable Share" shall mean, with respect to a Due
Period, the sum of (a) the Class A Floating Allocation of the Collections of
Finance Charge Receivables allocated to the Investor Certificates and deposited
in the Collection Account for such Due Period (excluding any such Collections
allocated as a result of the application of clause (b) of the definition of
Floating Allocation Percentage) and (b) if such Due Period occurs during the
Accumulation Period, all Collections allocated as a result of the operation of
clause (b) of the definition of Floating Allocation Percentage.
"Class A Available Funds" shall mean, with respect to any
Distribution Date, an amount equal to the sum of (a) the Class A Allocable Share
of the Collections of Finance Charge Receivables allocated to the Investor
Certificates and deposited in the Collection Account for the related Due Period,
(b) the amount of any Class A Cap Payment with respect to such Distribution Date
and the amount of any payments due from the Class A Cap Provider but not paid
with respect to any prior date (to the extent received by the Trustee), (c) with
respect to any Due Period during the Accumulation Period prior to the payment in
full of the Class A Investor Interest, the Principal Funding Investment Proceeds
arising pursuant to subsection 4.17(b), if any, with respect to the related
Distribution Date, (d) the Class A Floating Allocation of amounts, if any, to be
withdrawn from the Series Excess Funding Account and the Series Excess Funding
Reserve Account which will be deposited into the Collection Account on such
Distribution Date pursuant to subsections 4.21(b), 4.22(b) and 4.22(d) and (e)
the amount, if any, withdrawn from the Series Excess Funding Reserve Account on
such Distribution Date pursuant to subsection 4.22(e).
"Class A Cap" shall mean the interest rate cap agreement dated the
Closing Date between Fashion Service Corp. and the Class A Cap Provider and
assigned to the Trust for the benefit of the Class A Certificateholders in
substantially the form attached hereto as Exhibit D-1, or any Replacement
Interest Rate Cap therefor.
"Class A Cap Payment" shall mean, with respect to a Distribution
Date, the payment received from the Class A Cap Provider on the day preceding
such Distribution Date, as determined pursuant to the Class A Cap.
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"Class A Cap Provider" shall mean The Bank of Tokyo-Mitsubishi,
Ltd., New York Branch, or any successor or assign thereto appointed as provided
in the Class A Cap, in its individual capacity pursuant to the Class A Cap, or
if any Replacement Interest Rate Cap is obtained therefor pursuant to Section
4.19, the replacement cap provider named therein the short-term debt obligations
of which shall be rated at least A-1 by Standard & Poor's and P-1 by Xxxxx'x.
"Class A Certificate Rate" shall mean from the Closing Date
through December 14, 1997, from December 15, 1997 through January 14, 1998 and
with respect to each Interest Period thereafter, a per annum rate equal to 0.35%
per annum in excess of LIBOR as determined on the related LIBOR Determination
Date; provided that if the Class A Certificates are not paid in full on the
Class A Expected Final Payment Date, the Class A Certificate Rate applicable to
the Interest Period commencing on such date and each Interest Period thereafter
will not exceed 11.35% per annum.
"Class A Certificateholder" shall mean each Person in whose name a
Class A Certificate is registered in the Certificate Register.
"Class A Certificates" shall mean any of the certificates executed
by the Seller and authenticated by or on behalf of the Trustee, substantially in
the form of Exhibit A-1 hereto.
"Class A Deficiency Amount" shall have the meaning specified in
sub- section 4.6(a).
"Class A Expected Final Payment Date" shall mean the December 2002
Distribution Date.
"Class A Fixed Allocation" shall mean, with respect to any Due
Period other than a Due Period relating to the Revolving Period, the percentage
equivalent (which percentage shall never exceed 100%) of a fraction, the
numerator of which is the Class A Investor Interest as of the close of business
on the last day of the Revolving Period ending prior to such Due Period;
provided, however, that if Series 1997-1 is paired with a Paired Series and an
Early Amortization Event occurs with respect to such Paired Series during the
Accumulation Period, the Seller may, by written notice delivered to the Trustee,
the Servicer, Xxxxx'x and Standard & Poor's, designate a different numerator
(provided that such numerator is not less than the Class A Adjusted Investor
Interest as of the last day of the revolving period for such Paired Series), and
the denominator of which is equal to the numerator used to determine the
Principal Allocation Percentage with respect to such Due Period.
"Class A Floating Allocation" shall mean, with respect to any Due
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is the Class A Adjusted Investor Interest as
of the close of business on the last day of the preceding Due Period and the
denominator of which is equal to the Adjusted Investor Interest as of the close
of business on such day; provided, however, that, with respect to the first Due
Period, the Class A Floating Allocation shall mean the percentage equivalent of
a fraction, the
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numerator of which is the Class A Initial Investor Interest and the denominator
of which is the Initial Investor Interest.
"Class A Initial Investor Interest" shall mean the aggregate
initial principal amount of the Class A Certificates, which is $56,000,000.
"Class A Investor Allocation" shall mean, with respect to any Due
Period, (a) with respect to Loss Amounts and Collections of Finance Charge
Receivables at any time and Collections of Principal Receivables during the
Revolving Period, the Class A Floating Allocation and (b) with respect to
Collections of Principal Receivables during the Accumulation Period or Early
Amortization Period, the Class A Fixed Allocation.
"Class A Investor Charge-Offs" shall have the meaning specified in
subsection 4.10(a).
"Class A Investor Interest" shall mean, on any date of
determination, an amount equal to (a) the Class A Initial Investor Interest,
minus (b) the aggregate amount of principal payments made to Class A
Certificateholders prior to such date and minus (c) the excess, if any, of the
aggregate amount of Class A Investor Charge-Offs pursuant to subsection 4.10(a)
over Class A Investor Charge-Offs reimbursed pursuant to subsection 4.11(b)
prior to such date of determination; provided, however, that the Class A
Investor Interest may not be reduced below zero.
"Class A Investor Loss Amount" shall mean, with respect to each
Distribution Date, an amount equal to the product of (a) the Investor Loss
Amount for the related Due Period and (b) the Class A Floating Allocation
applicable for the related Due Period.
"Class A Monthly Interest" shall mean the monthly interest
distributable in respect of the Class A Certificates as calculated in accordance
with subsection 4.6(a).
"Class A Monthly Principal" shall mean the monthly principal
distributable in respect of the Class A Certificates as calculated in accordance
with subsection 4.7(a).
"Class A Required Amount" shall have the meaning specified in sub-
section 4.8(a).
"Class A Servicing Fee" shall have the meaning specified in
Section 3.
"Class B Additional Interest" shall have the meaning specified in
subsection 4.6(b).
"Class B Available Funds" shall mean, with respect to any
Distribution Date, an amount equal to the sum of (a) the Class B Floating
Allocation of the Collections of Finance Charge Receivables allocated to the
Investor Certificates and deposited in the Collection Account for the related
Due Period (excluding any such Collections allocated as a result of the
application of clause (b) of the definition of Floating Allocation Percentage);
(b) the amount of any Class B
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Cap Payment with respect to such Distribution Date and the amount of any
payments due from the Class B Cap Provider but not paid with respect to any
prior date (to the extent received by the Trustee) and (c) the Class B Floating
Allocation of amounts, if any, to be withdrawn from the Series Excess Funding
Account and the Series Excess Funding Reserve Account which will be deposited
into the Collection Account on the related Distribution Date pursuant to
subsections 4.21(b), 4.22(b) and 4.22(d).
"Class B Cap" shall mean the interest rate cap agreement dated the
Closing Date between Fashion Service Corp. and the Class B Cap Provider, and
assigned to the Trust for the benefit of the Class B Certificateholders, the
Class C Certificateholders and the Class D Certificateholders in substantially
the form attached hereto as Exhibit D-2, or any Replacement Interest Rate Cap
therefor.
"Class B Cap Payment" shall mean, with respect to a Distribution
Date, the payment received from the Class B Cap Provider on the day preceding
such Distribution Date, as determined pursuant to the Class B Cap.
"Class B Cap Provider" shall mean The Bank of Tokyo-Mitsubishi,
Ltd., New York Branch, or any successor or assign thereto appointed as provided
in the Class B Cap, in its individual capacity pursuant to the Class B Cap, or
if any Replacement Interest Rate Cap is obtained therefor pursuant to Section
4.19, the replacement cap provider named therein the short-term debt obligations
of which are rated at least A-1 by Standard & Poor's and P-1 by Xxxxx'x.
"Class B Certificate Rate" shall mean, from the Closing Date
through December 14, 1997, from December 15, 1997 through January 14, 1998, and
with respect to each Interest Period thereafter, a per annum rate equal to .70%
per annum in excess of LIBOR as determined on the related LIBOR Determination
Date; provided that if the Class B Certificates are not paid in full on the
Class B Expected Final Payment Date, the Class B Certificate Rate applicable to
the Interest Period commencing on such date and each Interest Period thereafter
will not exceed 9.70% per annum.
"Class B Certificateholder" shall mean each Person in whose name a
Class B Certificate is registered in the Certificate Register.
"Class B Certificates" shall mean any of the certificates executed
by the Seller and authenticated by or on behalf of the Trustee, substantially in
the form of Exhibit A-2 hereto.
"Class B Deficiency Amount" shall have the meaning specified in
subsection 4.6(b).
"Class B Expected Final Payment Date" shall mean the January 2003
Distribution Date.
"Class B Fixed Allocation" shall mean, with respect to any Due
Period other than a Due Period relating to the Revolving Period, the percentage
equivalent (which percentage shall never exceed 100%) of a fraction, the
numerator of which is the Class B Investor Interest as of the close of business
on the last day of the Revolving Period ending prior to such Due Period;
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provided, however, that if Series 1997-1 is paired with a Paired Series and an
Early Amortization Event occurs with respect to such Paired Series during the
Accumulation Period, the Seller may, by written notice delivered to the Trustee,
the Servicer, Xxxxx'x and Standard & Poor's, designate a different numerator
(provided that such numerator is not less than the Class B Investor Interest as
of the last day of the revolving period for such Paired Series), and the
denominator of which is equal to the numerator used to determine the Principal
Allocation Percentage with respect to such Due Period.
"Class B Floating Allocation" shall mean, with respect to any Due
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is the Class B Investor Interest as of the
close of business on the last day of the preceding Due Period and the
denominator of which is equal to the Adjusted Investor Interest as of the close
of business on such day; provided, however, that, with respect to the first Due
Period, the Class B Floating Allocation shall mean the percentage equivalent of
a fraction, the numerator of which is the Class B Initial Investor Interest and
the denominator of which is the Initial Investor Interest.
"Class B Initial Investor Interest" shall mean the aggregate
initial principal amount of the Class B Certificates, which is $8,500,000.
"Class B Investor Allocation" shall mean, with respect to any Due
Period (a) with respect to Loss Amounts and Collections of Finance Charge
Receivables at any time and Collections of Principal Receivables during the
Revolving Period, the Class B Floating Allocation and (b) with respect to
Collections of Principal Receivables during the Accumulation Period or Early
Amortization Period, the Class B Fixed Allocation.
"Class B Investor Charge-Offs" shall have the meaning specified in
subsection 4.10(b).
"Class B Investor Interest" shall mean, on any date of
determination, an amount equal to (a) the Class B Initial Investor Interest,
minus (b) the aggregate amount of principal payments made to Class B
Certificateholders prior to such date, minus (c) the aggregate amount of Class B
Investor Charge-Offs for all prior Distribution Dates pursuant to subsection
4.10(b), minus (d) the aggregate amount of Reallocated Class B Principal
Collections allocated pursuant to subsection 4.12 on all prior Distribution
Dates for which the Class C Investor Interest or the Class D Investor Interest
has not been reduced, minus (e) an amount equal to the amount by which the Class
B Investor Interest has been reduced on all prior Distribution Dates pursuant to
subsection 4.10(a) and plus (f) the aggregate amount of Excess Spread and Shared
Excess Finance Charge Collections allocated and available on all prior
Distribution Dates pursuant to subsection 4.11(d) for the purpose of reimbursing
amounts deducted pursuant to the foregoing clauses (c), (d) and (e); provided,
however, that the Class B Investor Interest may not be reduced below zero.
"Class B Investor Loss Amount" shall mean, with respect to each
Distribution Date, an amount equal to the product of (a) the Investor Loss
Amount for the related Due Period and (b) the Class B Floating Allocation
applicable for the related Due Period.
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"Class B Monthly Interest" shall mean the monthly interest
distributable in respect of the Class B Certificates as calculated in accordance
with subsection 4.6(b).
"Class B Monthly Principal" shall mean the monthly principal
distributable in respect of the Class B Certificates as calculated in accordance
with subsection 4.7(b).
"Class B Required Amount" shall have the meaning specified in sub-
section 4.8(b).
"Class B Servicing Fee" shall have the meaning specified in
Section 3.
"Class C Available Funds" shall mean, with respect to any
Distribution Date, an amount equal to the sum of (a) the Class C Floating
Allocation of Collections of Finance Charge Receivables allocated to the
Investor Certificates and deposited in the Collection Account for the related
Due Period (excluding any such Collections allocated as a result of the
application of clause (b) of the definition of Floating Allocation Percentage)
and (b) the Class C Floating Allocation of amounts, if any, to be withdrawn from
the Series Excess Funding Account and the Series Excess Funding Reserve Account
which will be deposited into the Collection Account on the related Distribution
Date pursuant to subsections 4.21(b), 4.22(b) and 4.22(d).
"Class C Certificate Rate" shall mean, from the Closing Date
through December 14, 1997, from December 15, 1997 through January 14, 1998, and
with respect to each Interest Period thereafter, the rate specified in the Class
C Purchase Agreement.
"Class C Certificateholder" shall mean each Person in whose name a
Class C Certificate is registered in the Certificate Register.
"Class C Certificates" shall mean any of the certificates executed
by the Seller and authenticated by or on behalf of the Trustee, substantially in
the form of Exhibit A-3 hereto.
"Class C Deficiency Amount" shall have the meaning specified in
subsection 4.6(c).
"Class C Fixed Allocation" shall mean, with respect to any Due
Period other than a Due Period relating to the Revolving Period, the percentage
equivalent (which percentage shall never exceed 100%) of a fraction, the
numerator of which is the Class C Investor Interest as of the close of business
on the last day of the Revolving Period ending prior to such Due Period;
provided, however, that if Series 1997-1 is paired with a Paired Series and an
Early Amortization Event occurs with respect to such Paired Series during the
Accumulation Period, the Seller may, by written notice delivered to the Trustee
and the Servicer, designate a different numerator (provided that such numerator
is not less than the Class C Investor Interest as of the last day of the
revolving period for such Paired Series), and the denominator of which is equal
to the numerator used to determine the Principal Allocation Percentage with
respect to such Due Period.
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"Class C Floating Allocation" shall mean, with respect to any Due
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is the Class C Investor Interest as of the
close of business on the last day of the preceding Due Period and the
denominator of which is equal to the Adjusted Investor Interest as of the close
of business on such day; provided, however, that, with respect to the first Due
Period, the Class C Floating Allocation shall mean the percentage equivalent of
a fraction, the numerator of which is the Class C Initial Investor Interest and
the denominator of which is the Initial Investor Interest.
"Class C Initial Investor Interest" shall mean the aggregate
initial principal amount of the Class C Certificates, which is $9,500,000.
"Class C Investor Allocation" shall mean, with respect to any Due
Period (a) with respect to Loss Amounts and Collections of Finance Charge
Receivables at any time and Collections of Principal Receivables during the
Revolving Period, the Class C Floating Allocation and (b) with respect to
Collections of Principal Receivables during the Accumulation Period or Early
Amortization Period, the Class C Fixed Allocation.
"Class C Investor Charge-Offs" shall have the meaning specified in
subsection 4.10(c).
"Class C Investor Interest" shall mean, on any date of
determination, an amount equal to (a) the Class C Initial Investor Interest,
minus (b) the aggregate amount of principal payments made to the Class C
Certificateholders prior to such date, minus (c) the aggregate amount of Class C
Investor Charge-Offs for all prior Distribution Dates pursuant to subsection
4.10(c), minus (d) the aggregate amount of Reallocated Class C Principal
Collections allocated pursuant to subsections 4.12(a) and (b) on all prior
Distribution Dates, minus (e) an amount equal to the amount by which the Class C
Investor Interest has been reduced on all prior Distribution Dates pursuant to
subsections 4.10(a) and (b), and plus (f) the aggregate amount of Excess Spread
and Shared Excess Finance Charge Collections allocated and available on all
prior Distribution Dates pursuant to subsection 4.11(h) for the purpose of
reimbursing amounts deducted pursuant to the foregoing clauses (c), (d) and (e);
provided further, however, that the Class C Investor Interest may not be reduced
below zero.
"Class C Investor Loss Amount" shall mean, with respect to any
Distribution Date, an amount equal to the product of (a) the Investor Loss
Amount for the related Due Period and (b) the Class C Floating Allocation
applicable for the related Due Period.
"Class C Monthly Interest" shall mean the monthly interest
distributable in respect of the Class C Certificates as calculated in accordance
with subsection 4.6(c).
"Class C Monthly Principal" shall mean the monthly principal
distributable in respect of the Class C Certificates as calculated in accordance
with subsection 4.7(c).
"Class C Purchase Agreement" shall mean the agreement among the
Seller, the Servicer, the Trustee and the initial Class C Certificateholders,
dated as of the Closing Date, as amended or modified from time to time.
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"Class C Required Amount" shall mean the amount, if any, equal to
the sum of (a) the amount, if any, by which the sum of (i) the Class C Monthly
Interest for such Distribution Date, plus (ii) the Class C Deficiency Amount, if
any, for such Distribution Date, plus (iii) the Class C Loss Amount, if any, for
the prior Due Period exceeds the amount of Excess Spread available to be applied
to such amounts pursuant to subsections 4.11(f) and (g), plus (b) the amount, if
any, by which the sum of (i) the Class C Servicing Fee for the prior Due Period,
plus (ii) the Class C Servicing Fee, if any, due but not paid on any prior
Distribution Date, exceeds the Class C Available Funds for the related Due
Period and the amount of any Excess Spread available to be applied to such
amount pursuant to subsection 4.11(e).
"Class C Servicing Fee" shall have the meaning specified in
Section 3.
"Class D Available Funds" shall mean, with respect to any
Distribution Date, an amount equal to the sum of (a) the Class D Floating
Allocation of Collections of Finance Charge Receivables allocated to the
Investor Certificates and deposited in the Collection Account for the related
Due Period (excluding any such Collections allocated as a result of the
application of clause (b) of the definition of Floating Allocation Percentage)
and (b) the Class D Floating Allocation of amounts, if any, to be withdrawn from
the Series Excess Funding Account and the Series Excess Funding Reserve Account
which will be deposited into the Collection Account on the related Distribution
Date pursuant to subsections 4.21(b), 4.22(b) and 4.22(d).
"Class D Certificate Rate" shall mean, from the Closing Date
through December 14, 1997, from December 15, 1997 through January 14, 1998, and
with respect to any Interest Period thereafter, a per annum rate equal to .25%
per annum in excess of the Class C Certificate Rate.
"Class D Certificateholder" shall mean any person in whose name a
Class D Certificate is registered in the Certificate Register.
"Class D Certificates" shall mean any of the certificates executed
by the Seller and authenticated by or on behalf of the Trustee, substantially in
the form of Exhibit A-4 hereto.
"Class D Fixed Allocation" shall mean, with respect to any Due
Period other than a Due Period relating to the Revolving Period, the percentage
equivalent (which percentage shall never exceed 100%) of a fraction, the
numerator of which is the Class D Investor Interest as of the close of business
on the last day of the Revolving Period ending prior to such Due Period;
provided, however, that if Series 1997-1 is paired with a Paired Series and an
Early Amortization Event occurs with respect to such Paired Series during the
Accumulation Period, the Seller may, by written notice delivered to the Trustee
and the Servicer, designate a different numerator (provided that such numerator
is not less than the Class D Investor Interest as of the last day of the
revolving period for such Paired Series), and the denominator of which is equal
to the numerator used to determine the Principal Allocation Percentage with
respect to such Due Period.
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"Class D Floating Allocation" shall mean, with respect to any Due
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is the Class D Investor Interest as of the
close of business on the last day of the preceding Due Period and the
denominator of which is equal to the Adjusted Investor Interest as of the close
of business on such day; provided, however, that with respect to the first Due
Period, the Class D Floating Allocation shall mean the percentage equivalent of
a fraction, the numerator of which is the Class D Initial Investor Interest and
the denominator of which is the Initial Investor Interest.
"Class D Initial Investor Interest" shall mean the aggregate
initial principal amount of the Class D Investor Interest, which is $9,500,000.
"Class D Investor Allocation" shall mean, with respect to any Due
Period, (a) with respect to Loss Amounts and Collections of Finance Charge
Receivables at any time and Principal Receivables during the Revolving Period,
the Class D Floating Allocation and (b) with respect to Collections of Principal
Receivables during the Accumulation Period or Early Amortization Period, the
Class D Fixed Allocation.
"Class D Investor Charge-Offs" shall have the meaning specified in
subsection 4.10(d).
"Class D Investor Interest" shall mean, on any date of
determination, an amount equal to (a) the Class D Initial Investor Interest,
minus (b) the aggregate amount of principal payments made to the holders of the
Class D Certificates prior to such date, minus (c) the aggregate amount of Class
D Investor Charge-Offs for all prior Distribution Dates pursuant to subsection
4.10(d), minus (d) the aggregate amount of Reallocated Class D Principal
Collections allocated pursuant to subsections 4.12(a), (b) and (c) on all prior
Distribution Dates, minus (e) an amount equal to the amount by which the Class D
Investor Interest has been reduced on all prior Distribution Dates pursuant to
subsections 4.10(a), (b) and (c), and plus (f) the aggregate amount of Excess
Spread and Shared Excess Finance Charge Collections allocated and available on
all prior Distribution Dates pursuant to subsection 4.11(o) for the purpose of
reimbursing amounts deducted pursuant to the foregoing clauses (c), (d) and (e);
provided further, however, that the Class D Investor Interest may not be reduced
below zero.
"Class D Investor Loss Amount" shall mean, with respect to any
Distribution Date, an amount equal to the product of (a) the Investor Loss
Amount for the related Due Period and (b) the Class D Floating Allocation
applicable for the related Due Period.
"Class D Monthly Interest" shall mean the monthly interest
distributable in respect of the Class D Certificates as calculated in accordance
with subsection 4.6(d).
"Class D Monthly Principal" shall mean the monthly principal
distributable in respect of the Class D Certificates as calculated in accordance
with subsection 4.7(d).
"Class D Servicing Fee" shall have the meaning specified in
Section 3.
"Closing Date" shall mean November 25, 1997.
12
"Controlled Accumulation Amount" shall mean an amount equal to the
Class A Initial Investor Interest divided by the Accumulation Period Length.
"Controlled Deposit Amount" for any Due Period shall mean the
excess, if any, of (a) the product of the Controlled Accumulation Amount and the
number of months elapsed with respect to the Accumulation Period through and
including such Due Period over (b) the Principal Funding Account Balance as of
the end of the day of the last day of the prior Due Period; provided, that from
and after the Distribution Date occurring in such Due Period, the Controlled
Deposit Amount for such Due Period shall be reduced by the amount of Available
Principal Collections that are deposited into the Principal Funding Account on
such Distribution Date.
"Controlling Certificateholders" shall mean (a) on any date of
determination on which the Class A Investor Interest or the Class B Investor
Interest is greater than zero, the Holders of Class A Certificates and Class B
Certificates evidencing more than 50% of the sum of the Class A Investor
Interest and the Class B Investor Interest, and (b) thereafter, the Holders of
Class C Certificates evidencing more than 50% of the Class C Investor Interest.
"Covered Amount" shall mean, for any Distribution Date with
respect to the Accumulation Period, the product of (a) the Class A Certificate
Rate, (b) the Principal Funding Account Balance on the last day of the preceding
Due Period and (c) a fraction, the numerator of which is the actual number of
days in the related Interest Period and the denominator of which is 360.
"Cumulative Principal Shortfall" shall mean the sum of the
Principal Shortfalls (as such term is defined in each of the related Supplements
or Receivables Purchase Agreement) for each Series in Group One that are
Principal Sharing Series.
"Deposit Amount" shall have the meaning specified in subsection
4.21(c).
"Distribution Date" shall mean January 15, 1998 and the fifteenth
day of each calendar month thereafter, or if such fifteenth day is not a
Business Day, the next succeeding Business Day.
"Early Amortization Period" shall mean the period commencing at
the close of business on the Business Day immediately preceding the day on which
an Early Amortization Event with respect to Series 1997-1 is deemed to have
occurred, and ending on the Series 1997-1 Termination Date.
"Enhancement" shall mean (a) with respect to the Class A
Certificates, the subordination of the Class B Certificates, the Class C
Certificates and the Class D Certificates, (b) with respect to the Class B
Certificates, the subordination of the Class C Certificates and the Class D
Certificates and (c) with respect to the Class C Certificates, the subordination
of the Class D Certificates.
"Enhancement Provider" shall mean, collectively, the Class C
Certificateholders.
13
"Excess Spread" shall mean, with respect to any Distribution Date,
the sum of the amounts with respect to such Distribution Date, if any, specified
pursuant to subsections 4.9(a)(iv), 4.9(b)(iv), 4.9(c)(ii) and 4.9(d)(ii).
"Finance Charge Shortfall" shall have the meaning specified in
subsection 4.14(b).
"Fixed Principal Allocation Date" shall mean the earlier of (a)
the date on which an Early Amortization Event with respect to Series 1997-1 is
deemed to have occurred; and (b) a date selected by the Servicer before the
Class A Expected Final Payment Date, if any. If the Servicer establishes a Fixed
Principal Allocation Date pursuant to clause (b) of the preceding sentence, the
Servicer shall provide notification of such date to the Seller, the Trustee, the
Enhancement Provider and the Rating Agencies no later than two Business Days
prior to such date.
"Floating Allocation Percentage" shall mean, with respect to any
Due Period (including any day within such Due Period), the sum of (a) the
percentage equivalent of a fraction, the numerator of which is the excess of the
Adjusted Investor Interest at the end of the day on the last day of the prior
Due Period (or with respect to the first Due Period ending after the Closing
Date, the Initial Investor Interest) over the Series Excess Funding Account
Balance on such day and the denominator of which is the greater of (i) the sum
of (A) the aggregate amount of Principal Receivables in the Trust at the end of
the day on such date (or with respect to the first Due Period ending after the
Closing Date, at the end of the day on the Closing Date) and (B) the Excess
Funding Amount as of the close of business of the last day of the prior Due
Period, and (ii) the sum of the numerators used to calculate the
Investor/Purchaser Percentages for such Due Period with respect to Finance
Charge Receivables, Principal Receivables or Loss Amounts, as applicable, for
all Series of Certificates and Receivable Purchase Series outstanding and (b)
for any Due Period with respect to the Accumulation Period (including any day
within such Due Period), the percentage equivalent of a fraction which if
multiplied by denominator of the fraction described in clause (a) above would
produce, on the basis of the actual number of days in the related Interest
Period and a year of 360 days, an amount equal to the Principal Funding
Investment Shortfall with respect to such Due Period; provided, that with
respect to any Due Period in which an Addition Date or Removal Date occurs, the
amount in clause (i)(A) above shall be (1) the aggregate amount of Principal
Receivables in the Trust at the end of the day on the last day of the prior Due
Period for the period from and including the first day of such Due Period to but
excluding the related Addition Date or Removal Date and (2) the aggregate amount
of Principal Receivables in the Trust at the end of the day on the related
Addition Date or Removal Date for the period from and including the related
Addition Date or Removal Date to and including the last day of such Due Period;
provided further, that with respect to any Due Period in which an Addition Date
or a Removal Date occurs and the Servicer need not make daily deposits of
Collections into the Collection Account, the amount in (i)(A) above shall be the
Average Principal Balance.
"Group One" shall mean Series 1997-1 and each other Series
specified in the related Supplement or Receivables Purchase Agreement to be
included in Group One.
14
"Initial Investor Interest" shall mean the sum of the Class A
Initial Investor Interest, the Class B Initial Investor Interest, the Class C
Initial Investor Interest and the Class D Initial Investor Interest.
"Interest Period" shall mean, with respect to any Distribution
Date, the period from and including the previous Distribution Date through the
day preceding such Distribution Date, except that the initial Interest Period
shall be the period from and including the Closing Date through the day
preceding the initial Distribution Date.
"Interest Rate Cap" shall mean either of the Class A Cap or the
Class B Cap.
"Interest Rate Cap Provider" shall mean either of the Class A Cap
Provider or the Class B Cap Provider.
"Investor Certificateholder" shall mean (a) with respect to the
Class A Certificates, any Class A Certificateholder, (b) with respect to the
Class B Certificates, any Class B Certificateholder, (c) with respect to the
Class C Certificates, any Class C Certificateholder and (d) with respect to the
Class D Certificates, any Class D Certificateholder.
"Investor Certificates" shall mean the Class A Certificates, the
Class B Certificates, the Class C Certificates and the Class D Certificates.
"Investor Loss Amount" shall mean, with respect to any
Distribution Date, an amount equal to the product of (a) the aggregate of the
Loss Amounts for the related Due Period and (b) the Floating Allocation
Percentage for such Due Period.
"Investor Monthly Servicing Fee" shall mean, with respect to any
Due Period, an amount equal to one-twelfth of the product of the Series
Servicing Fee Percentage and the Adjusted Investor Interest as of the last day
of the preceding Due Period; provided that with respect to the first Due Period
ending after the Closing Date, the Investor Monthly Servicing Fee shall be
$236,583.34.
"Investor/Purchaser Percentage" shall mean, with respect to
Collections of Principal Receivables, the Principal Allocation Percentage, and
with respect to Collections of Finance Charge Receivables or Loss Amounts, the
Floating Allocation Percentage.
"LIBOR" shall mean, for any Interest Period, the London interbank
offered rate for one-month United States dollar deposits determined by the
Trustee for each Interest Period in accordance with the provisions of Section
4.18.
"LIBOR Determination Date" shall mean November 21, 1997 for the
period from the Closing Date through December 14, 1997, December 11, 1997 for
the period from December 15, 1997 through January 14, 1998, and the second
London Business Day prior to the commencement of the second and each subsequent
Interest Period.
15
"London Business Day" shall mean a day on which the Trustee and
commercial banks in the City of London are open for the transaction of
commercial banking business.
"Minimum Seller Interest" shall mean, as of any date of
determination, the product of 2% and the excess of the Adjusted Investor
Interest over the Series Excess Funding Account Balance on such date of
determination; provided, however, that the Seller may reduce the Minimum Seller
Interest upon (i) ten Business Days' prior notice to the Trustee, each Rating
Agency and the Class C Certificateholder, (ii) satisfaction of the Rating Agency
Condition, (iii) delivery to the Trustee, each Purchaser Representative and the
Class C Certificateholder of an Officer's Certificate to the effect that such
reduction will not then or thereafter cause an Early Amortization Event to occur
with respect to any Series, (iv) receipt by the Seller of the consent of the
Class C Certificateholder to such reduction, and (v) delivery of a Tax Opinion
to the Trustee with respect to such reduction.
"Monthly Interest" shall mean, with respect to any Distribution
Date, the sum of (a) the Class A Monthly Interest, the Class A Additional
Interest, if any, and the unpaid Class A Deficiency Amount, if any; (b) the
Class B Monthly Interest, the Class B Additional Interest, if any, and the
unpaid Class B Deficiency Amount, if any; (c) the Class C Monthly Interest and
the unpaid Class C Deficiency Amount, if any; and (d) the Class D Monthly
Interest, each with respect to such Distribution Date.
"Portfolio Yield" shall mean, with respect to any Due Period, the
annualized percentage equivalent of a fraction, the numerator of which is an
amount equal to the sum of (a) the Floating Allocation Percentage of Collections
of Finance Charge Receivables allocated to the Investor Certificates for such
Due Period, (b) the amount of any Principal Funding Investment Proceeds for the
related Distribution Date, (c) any Shared Excess Finance Charge Collections that
are allocated to Series 1997-1 pursuant to Section 4.14 for the related
Distribution Date, and (d) the amount of funds, if any, to be withdrawn from the
Series Excess Funding Account and the Series Excess Funding Reserve Account
which, pursuant to subsections 4.21(b), 4.22(b), 4.22(d), 4.22(e) and 4.22(f)
are required to be deposited in the Collection Account with respect to such
Distribution Date, such sum to be calculated on a cash basis after subtracting
the Investor Loss Amount for such Due Period, and the denominator of which is
the Series Investor Interest as of the last day of the preceding Due Period (or
with respect to the initial Due Period, the Initial Investor Interest).
"Principal Allocation Percentage" shall mean, (a) with respect to
any Due Period (including any day within such Due Period) occurring prior to the
Fixed Principal Allocation Date, the Floating Allocation Percentage for such Due
Period, and (b) with respect to any Due Period (including any day within such
Due Period) occurring on or after the Fixed Principal Allocation Date, the
percentage equivalent of a fraction, the numerator of which is the Series
Investor Interest as of the end of the day on the last day of the Due Period
occurring immediately prior to the Fixed Principal Allocation Date, as
applicable and the denominator of which is the greater of (x) the sum of (i) the
aggregate amount of Principal Receivables in the Trust at the end of the day on
the last day of the prior Due Period and (ii) the Excess Funding Amount as of
the close of business of the last day of the prior Due Period, and (y) the sum
of the numerators used to calculate the Investor/Purchaser Percentages for such
Due Period with respect to Principal
16
Receivables for all Series of Certificates and Receivable Purchase Series
outstanding; provided, that with respect to any Due Period in which an Addition
Date or Removal Date occurs, the amount in (x)(i) above shall be (1) the
aggregate amount of Principal Receivables in the Trust at the end of the day on
the last day of the prior Due Period for the period from and including the first
day of such Due Period to but excluding the related Addition Date or Removal
Date and (2) the aggregate amount of Principal Receivables in the Trust at the
end of the day on the related Addition Date or Removal Date for the period from
and including the related Addition Date or Removal Date to and including the
last day of such Due Period; provided further, that with respect to any Due
Period in which an Addition Date or a Removal Date occurs and the Servicer need
not make daily deposits of Collections into the Collection Account, the amount
in clause (x)(i) above shall be the Average Principal Balance.
"Principal Funding Account" shall have the meaning set forth in
sub- section 4.17(a).
"Principal Funding Account Balance" shall mean, with respect to
any date of determination during the Accumulation Period, the principal amount,
if any, on deposit in the Principal Funding Account on such date of
determination.
"Principal Funding Investment Proceeds" shall mean, with respect
to each Due Period during the Accumulation Period, the investment earnings on
funds in the Principal Funding Account (net of investment expenses and losses)
for such Due Period.
"Principal Funding Investment Shortfall" shall mean, with respect
to each Due Period during the Accumulation Period, the amount, if any, by which
the Principal Funding Investment Proceeds are less than the Covered Amount;
provided that for purposes of determining the Principal Funding Investment
Shortfall for purposes of clause (b) of the definition of Floating Allocation
Percentage, on any date when the Principal Funding Investment Proceeds or the
Covered Amount cannot be determined, Principal Funding Investment Proceeds for
such Due Period will be assumed to be the product of (x) 1/12, (y) 2.5% and (z)
the Principal Funding Account Balance as of the first day of such Due Period and
the Covered Amount shall be determined as if the Class A Certificate Rate was
65% greater than the Class A Certificate Rate applicable to the then-current
Interest Period.
"Principal Shortfall" shall mean, as the context requires, any of
the following: (a) on any Distribution Date with respect to the Accumulation
Period, the amount by which the Controlled Deposit Amount for the prior Due
Period exceeds the amount of Available Principal Collections for such
Distribution Date (excluding any portion thereof attributable to Shared
Principal Collections); and (b) on any Distribution Date with respect to the
Early Amortization Period, the amount by which the sum of the Adjusted Investor
Interest exceeds the Available Principal Collections for such Distribution Date
(excluding any portion thereof attributable to Shared Principal Collections).
"Rating Agency" shall mean Moody's and Standard & Poor's.
17
"Reallocated Class B Principal Collections" shall mean, with
respect to any Distribution Date, Collections of Principal Receivables applied
in accordance with subsection 4.12(a) in an amount not to exceed the amount
described in subsection 4.5(a)(iv) during the Revolving Period and subsection
4.5(b)(iv) during the Accumulation Period; provided, however, that such amount
shall not exceed the Class B Investor Interest after giving effect to any Class
B Investor Charge-Offs for such Distribution Date.
"Reallocated Class C Principal Collections" shall mean, with
respect to any Distribution Date, Collections of Principal Receivables applied
in accordance with subsection 4.12(a) in an amount not to exceed the amount
described in subsection 4.5(a)(iii) during the Revolving Period and subsection
4.5(b)(iii) during the Accumulation Period; provided, however, that such amount
shall not exceed the Class C Investor Interest after giving effect to any Class
C Investor Charge-Offs for such Distribution Date.
"Reallocated Class D Principal Collections" shall mean, with
respect to any Distribution Date, Collections of Principal Receivables applied
in accordance with subsection 4.12(a) in an amount not to exceed the amount
described in subsection 4.5(a)(ii) during the Revolving Period and subsection
4.5(b)(ii) during the Accumulation Period; provided, however, that such amount
shall not exceed the Class D Investor Interest after giving effect to any Class
D Investor Charge-Offs for such Distribution Date.
"Reallocated Principal Collections" shall mean the sum of (a)
Reallocated Class B Principal Collections, (b) Reallocated Class C Principal
Collections and (c) Reallocated Class D Principal Collections.
"Reference Banks" shall mean four major banks in the London
interbank market selected by the Servicer.
"Remitted Amount" shall have the meaning specified in subsection
4.21(c).
"Replacement Interest Rate Cap" shall mean any replacement
interest cap having substantially similar terms and conditions as the Interest
Rate Cap it replaces.
"Revolving Period" shall mean the period from and including the
Closing Date to, but not including, the earlier of (a) the day the Accumulation
Period commences or (b) the day the Early Amortization Period commences.
"Series Accounts" means the Principal Funding Account, the Series
Excess Funding Account and the Series Excess Funding Reserve Account.
"Series Excess Funding Account" shall have the meaning set forth
in subsection 4.21(a).
"Series Excess Funding Account Balance" means, with respect to any
date of determination, the principal amount, if any, on deposit in the Series
Excess Funding Account on such date of determination.
18
"Series Excess Funding Account Covered Amount" shall mean, for any
Distribution Date, 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 weighted average of the Class A Certificate Rate, the
Class B Certificate Rate, the Class C Certificate Rate and the Class D
Certificate Rate, weighted based on the Class A Investor Interest, the Class B
Investor Interest, the Class C Investor Interest and the Class D Investor
Interest and (c) the Series Excess Funding Account Balance on the last day of
the preceding Due Period.
"Series Excess Funding Account Investment Proceeds" shall mean,
with respect to each Due Period, the investment earnings on funds in the Series
Excess Funding Account (net of investment expenses and losses) for such Due
Period.
"Series Excess Funding Account Investment Shortfall" shall mean,
(x) with respect to each Due Period occurring prior to the payment in full of
all Certificate Series outstanding prior to the Closing Date, the amount, if
any, by which the Series Excess Funding Account Investment Proceeds are less
than the Series Excess Funding Account Covered Amount and (y) thereafter, $0.
"Series Excess Funding Account Required Amount" shall mean, as of
any date of determination, the amount, if any, by which the Minimum Aggregate
Principal Receivables exceeds the aggregate amount of Principal Receivables.
"Series Excess Funding Account Surplus" shall mean as of any date
of determination, the amount, if any, which, if withdrawn from the Series Excess
Funding Account, would not cause the Minimum Aggregate Principal Receivables to
exceed the aggregate amount of Principal Receivables.
"Series Excess Funding Reserve Account" shall have the meaning set
forth in subsection 4.22(a).
"Series Excess Funding Reserve Account Required Amount" shall
mean, with respect to any Distribution Date, an amount equal to (a) the product
of .50% and the Series Excess Funding Account Balance or (b) any other amount
designated by the Seller; provided, that if such designation is of a lesser
amount, the Seller shall (i) provide the Servicer, the Class C Certificateholder
and the Trustee with evidence that the Rating Agency Condition shall have been
satisfied and (ii) deliver to the Trustee a certificate of an authorized officer
to the effect that, based on the facts known to such officer at such time, in
the reasonable belief of the Seller, such designation will not cause an Early
Amortization Event or an event that, after the giving of notice or the lapse of
time, would cause an Early Amortization Event to occur with respect to Series
1997-1.
"Series Excess Funding Reserve Account Surplus" shall mean, as of
any date of determination, the amount, if any, by which the amount on deposit in
the Series Excess Funding Reserve Account exceeds the Series Excess Funding
Reserve Account Required Amount.
19
"Series Excess Funding Reserve Draw Amount" shall have the meaning
set forth in subsection 4.22(c).
"Series Investor Interest" shall mean, on any date of
determination, an amount equal to (a) the sum of (i) the Class A Investor
Interest, (ii) the Class B Investor Interest, (iii) the Class C Investor
Interest and (iv) the Class D Investor Interest, each as of such date minus (b)
the Series Excess Funding Account Balance on such date.
"Series 1997-1" shall mean the Series of the Charming Shoppes
Master Trust represented by the Investor Certificates.
"Series 1997-1 Certificateholder" shall mean the Holder of record
of any Series 1997-1 Certificate.
"Series 1997-1 Certificates" shall mean the Class A Certificates,
the Class B Certificates, the Class C Certificates and the Class D Certificates.
"Series 1997-1 Early Amortization Event" shall have the meaning
specified in Section 9 of this Supplement.
"Series 1997-1 Termination Date" shall mean the earliest to occur
of (a) the Distribution Date on which the Series 1997-1 Certificates are paid in
full, (b) the April 2006 Distribution Date or (c) the date of termination of the
Trust pursuant to Section 12.1.
"Series Servicing Fee Percentage" shall mean 2.0%.
"Shared Excess Finance Charge Collections" shall mean, with
respect to any Distribution Date, as the context requires, either (a) the
aggregate amount of Collections of Finance Charge Receivables allocated to the
Investor Certificates but available to cover Finance Charge Shortfalls for other
Series in Group One, if any, or (b) the aggregate amount of Collections of
Finance Charge Receivables and other amounts allocable to other Series in Group
One in excess of the amounts necessary to make required payments with respect to
such Series, if any, and available to cover any Finance Charge Shortfall with
respect to the Investor Certificates as described in Section 4.14.
"Shared Principal Collections" shall mean, as the context
requires, either (a) the amount allocated to the Investor Certificates which may
be applied to cover Principal Shortfalls with respect to other outstanding
Series in Group One, or (b) the amounts allocated to the Investor Certificates
of other Series in Group One that the applicable Supplements for such Series
specify are to be treated as "Shared Principal Collections" and which may be
applied to cover Principal Shortfalls with respect to the Investor Certificates
pursuant to Section 4.15.
"Telerate Page 3750" shall mean the display page currently so
designated on the Dow Xxxxx Telerate Service (or such other page as may replace
that page on that service for displaying comparable rates or prices).
20
SECTION 0.0.3. SERVICING COMPENSATION. The share of the Monthly
Servicing Fee allocable to Series 1997-1 with respect to any Due Period (the
"Investor Monthly Servicing Fee") shall be equal to one-twelfth of the product
of (i) the Series Servicing Fee Percentage and (ii) the Adjusted Investor
Interest less the Series Excess Funding Account Balance, in each case, as of the
last day of such Due Period; provided, however, that with respect to the first
Due Period ending after the Closing Date, the Investor Monthly Servicing Fee
shall be equal to $236,583.34. The share of the Investor Monthly Servicing Fee
allocable to the Class A Investor Interest with respect to any Due Period (the
"Class A Servicing Fee") shall be equal to one-twelfth of the product of (i) the
Class A Floating Allocation, (ii) the Series Servicing Fee Percentage, and (iii)
the Adjusted Investor Interest, less the Series Excess Funding Account Balance,
in each case, as of the last day of such Due Period; provided, however, that
with respect to the first Due Period ending after the Closing Date, the Class A
Servicing Fee shall be equal to $158,666.67. The share of the Investor Monthly
Servicing Fee allocable to the Class B Investor Interest with respect to any Due
Period (the "Class B Servicing Fee") shall be equal to one-twelfth of the
product of (i) the Class B Floating Allocation, (ii) the Series Servicing Fee
Percentage and (iii) the Adjusted Investor Interest less the Series Excess
Funding Account Balance, in each case, as of the last day of such Due Period;
provided, however, that with respect to the first Due Period ending after the
Closing Date, the Class B Servicing Fee shall be equal to $24,083.33. The share
of the Investor Monthly Servicing Fee allocable to the Class C Investor Interest
with respect to any Due Period (the "Class C Servicing Fee") shall be equal to
one-twelfth of the product of (i) the Class C Floating Allocation, (ii) the
Series Servicing Fee Percentage and (iii) the Adjusted Investor Interest less
the Series Excess Funding Account Balance, in each case, as of the last day of
such Due Period; provided, however, that with respect to the first Due Period
ending after the Closing Date, the Class C Servicing Fee shall be equal to
$26,916.67. The share of the Investor Monthly Servicing Fee allocable to the
Class D Investor Interest with respect to any Due Period (the "Class D Servicing
Fee"; together with the Class A Servicing Fee, the Class B Servicing Fee and the
Class C Servicing Fee, the "Certificateholder Servicing Fee") shall be equal to
one-twelfth of the product of (i) the Class D Floating Allocation, (ii) the
Series Servicing Fee Percentage and (iii) the Adjusted Investor Interest less
the Series Excess Funding Account Balance, in each case, as of the last day of
such Due Period; provided, however, that with respect to the first Due Period
ending after the Closing Date, the Class D Servicing Fee shall be equal to
$26,916.67. Except as specifically provided above, the Investor Monthly
Servicing Fee shall be paid by the cash flows from the Trust allocated to the
Seller or the Certificateholders of other Series (as provided in the related
Supplements or Receivables Purchase Agreements) and in no event shall the Trust,
the Trustee or the Investor Certificateholders be liable therefor. The Class A
Servicing Fee shall be payable to the Servicer solely to the extent amounts are
available for distribution in respect thereof pursuant to subsections 4.9(a)(ii)
and 4.11(a). The Class B Servicing Fee shall be payable solely to the extent
amounts are available for distribution in respect thereof pursuant to
subsections 4.9(b)(ii) and 4.11(c). The Class C Servicing Fee shall be payable
solely to the extent amounts are available for distribution in respect thereof
pursuant to subsections 4.9(c)(i) and 4.11(e). The Class D Servicing Fee shall
be
21
payable solely to the extent amounts are available for distribution in respect
thereof pursuant to subsections 4.9(d)(i) and 4.11(l).
SECTION 0.0.4. REASSIGNMENT AND TRANSFER TERMS. The Investor
Certificates shall be subject to retransfer to the Seller at its option, in
accordance with the terms specified in subsection 12.2(a), on any Distribution
Date on or after the Distribution Date on which the Series Investor Interest is
less than or equal to 5% of the Initial Investor Interest. The deposit required
in connection with any such repurchase shall be equal to the Series Investor
Interest plus accrued and unpaid interest on the Investor Certificates through
the day preceding the Distribution Date on which the repurchase occurs.
SECTION 0.0.5. DELIVERY AND PAYMENT FOR THE INVESTOR CERTIFICATES.
The Seller shall execute and deliver the Investor Certificates to the Trustee
for authentication in accordance with Section 6.1. The Trustee shall deliver the
Investor Certificates when authenticated in accordance with Section 6.2.
SECTION 0.0.6. DEPOSITORY; FORM OF DELIVERY OF SERIES 1997-1
CERTIFICATES.
0.0.6.1. The Class A Certificates and the Class B Certificates
shall be delivered as Book-Entry Certificates as provided in Sections 6.2 and
6.10.
0.0.6.2. The Depository for Series 1997-1 shall be The Depository
Trust Company, and the Class A Certificates and Class B Certificates shall be
initially registered in the name of Cede & Co., its nominee.
SECTION 0.0.7. ARTICLE IV OF AGREEMENT. Sections 4.1, 4.2 and 4.3
of the Agreement shall be read in their entirety as provided in the Agreement.
Article IV of the Agreement (except for Sections 4.1, 4.2 and 4.3 thereof) shall
read in its entirety as follows and shall be applicable only to the Series
1997-1 Certificates.
22
ARTICLE 1.
RIGHTS OF CERTIFICATEHOLDERS AND RECEIVABLES
PURCHASERS AND ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION 1.1. RIGHTS OF INVESTOR CERTIFICATEHOLDERS. The Investor
Certificates shall represent undivided interests in the Trust, consisting of the
right to receive, to the extent necessary to make the required payments with
respect to such Investor Certificates at the times and in the amounts specified
in this Agreement, (a) the Floating Allocation Percentage and Principal
Allocation Percentage (as applicable from time to time) of Collections received
with respect to the Receivables and (b) funds on deposit in the Collection
Account, the Principal Funding Account, the Series Excess Funding Account and
the Series Excess Funding Reserve Account. The Class D Certificate shall be
subordinate to the Class A Certificates, the Class B Certificates and the Class
C Certificates. The Class C Certificates shall be subordinate to the Class A
Certificates and the Class B Certificates. The Class B Certificates shall be
subordinate to the Class A Certificates. The Exchangeable Seller Certificate
shall not represent any interest in the Collection Account, the Principal
Funding Account, the Series Excess Funding Account or the Series Excess Funding
Reserve Account, except as specifically provided in this Article IV.
SECTION 1.2. Allocations.
1.2.0.1. Allocations During the Revolving Period. During the
Revolving Period, the Servicer shall, prior to the close of business on the
day any Collections are deposited in the Collection Account, allocate to
the Investor Certificateholders, the Certificateholders of other Series and
the Holder of the Exchangeable Seller Certificate the following amounts as
set forth below:
1.2.0.1.1. Allocate to the Investor Certificateholders an amount
equal to the product of (A) the Floating Allocation Percentage on
such date and (B) the aggregate amount of Collections processed in
respect of Finance Charge Receivables on such date to be applied in
accordance with Section 4.9.
1.2.0.1.2. An amount equal to the product of (A) the Class D
Investor Allocation on such date, (B) the Investor/ Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on such date, to be
applied first in accordance with Section 4.12 and then in accordance
with subsection 4.9(e).
1.2.0.1.3. An amount equal to the product of (A) the Class C
Investor Allocation on such date, (B) the Investor/Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on
23
such date, to be applied first in accordance with Section 4.12 and
then in accordance with subsection 4.9(e).
1.2.0.1.4. An amount equal to the product of (A) the Class B
Investor Allocation on such date, (B) the Investor/Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on such date, to be
applied first in accordance with Section 4.12 and then in accordance
with subsection 4.9(e).
1.2.0.1.5. An amount equal to the product of (A) the Class A
Investor Allocation on such date, (B) the Investor/Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on such date, to be
applied in accordance with subsection 4.9(e).
1.2.0.2. Allocations During the Accumulation Period. During the
Accumulation Period, the Servicer shall, prior to the close of business
on the any Collections are deposited in the Collection Account,
allocate to the Investor Certificateholders, the Certificateholders of
other Series or the Holder of the Exchangeable Seller Certificate the
following amounts as set forth below:
1.2.0.2.1. Allocate to the Investor Certificateholders an amount
equal to the product of (A) the Floating Allocation Percentage on
such date and (B) the aggregate amount of Collections processed in
respect of Finance Charge Receivables on such date, to be applied in
accordance with Section 4.9.
1.2.0.2.2. An amount equal to the product of (A) the Class D
Investor Allocation on such date, (B) the Investor/Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on such date, to be
applied first in accordance with Section 4.12 and then in accordance
with subsection 4.9(f).
1.2.0.2.3. An amount equal to the product of (A) the Class C
Investor Allocation on such date, (B) the Investor/Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on such date, to be
applied first in accordance with Section 4.12 and then in accordance
with subsection 4.9(f).
1.2.0.2.4. An amount equal to the product of (A) the Class B
Investor Allocation on such date, (B) the Investor/Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on such date, to be
applied first in accordance with Section 4.12 and then in accordance
with subsection 4.9(f).
1.2.0.2.5. An amount equal to the product of (A) the Class A
Investor Allocation on such date, (B) the Investor/Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on such date, to be
applied in accordance with subsection 4.9(f).
24
1.2.0.3. Allocations During the Early Amortization Period. During
the Early Amortization Period, the Servicer shall, prior to the close
of business on the day any Collections are deposited in the Collection
Account, allocate to the Investor Certificateholders, the
Certificateholders of other Series or the Holder of the Exchangeable
Seller Certificate the following amounts as set forth below:
1.2.0.3.1. Allocate to the Investor Certificateholders an amount
equal to the product of (A) the Floating Allocation Percentage on
such date and (B) the aggregate amount of such Collections processed
in respect of Finance Charge Receivables on such date, to be applied
in accordance with Section 4.9.
1.2.0.3.2. An amount equal to the product of (A) the Class D
Investor Allocation on such date, (B) the Investor/Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on such date, to be
applied first in accordance with Section 4.12 and then in accordance
with subsection 4.9(f).
1.2.0.3.3. An amount equal to the product of (A) the Class C
Investor Allocation on such date, (B) the Investor/Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on such date, to be
applied first in accordance with Section 4.12 and then in accordance
with subsection 4.9(f).
1.2.0.3.4. An amount equal to the product of (A) the Class B
Investor Allocation on such date, (B) the Investor/Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on such date, to be
applied first in accordance with Section 4.12 and then in accordance
with subsection 4.9(f).
1.2.0.3.5. An amount equal to the product of (A) the Class A
Investor Allocation on such date, (B) the Investor/Purchaser
Percentage on such date and (C) the aggregate amount of Collections
processed in respect of Principal Receivables on such date, to be
applied in accordance with subsection 4.9(f).
SECTION 1.3. DETERMINATION OF MONTHLY INTEREST.
1.3.0.1. The amount of monthly interest distributable in respect
of the Class A Certificates on each 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 balance of the Class A Certificates
determined as of the Record Date preceding such Distribution Date (the
"Class A Monthly Interest"); provided, however, that with respect to
the first Distribution Date, Class A Monthly Interest will be equal to
interest accrued on the initial outstanding principal balance of the
Class A Certificates at the Class A Certificate Rate from the Closing
Date through January 14, 1998; provided further, however,
25
that in addition to Class A Monthly Interest an amount equal to the
amount of any unpaid Class A Deficiency Amounts, as defined below,
plus an amount equal to the product of (A) a fraction, the numerator
of which is the actual number of days in the related Interest Period
and the denominator of which is 360, (B) the sum of the Class A
Certificate Rate, and 2.0% per annum, and (C) any Class A Deficiency
Amounts from the prior Distribution Date, as defined below (or the
portion thereof which has not theretofore been paid to Class A
Certificateholders) (the "Class A Additional Interest") shall also be
distributable in respect of the Class A Certificates. The "Class A
Deficiency Amount" for any Distribution Date shall be equal to the
excess, if any, of the aggregate amount accrued pursuant to this
subsection 4.6(a) for all prior Interest Periods over the amount
actually paid to Class A Certificateholders in respect of such
amounts.
(b) The amount of monthly interest distributable in respect of the
Class B Certificates on each 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 outstanding principal balance of the
Class B Certificates determined as of the Record Date preceding such
Distribution Date (the "Class B Monthly Interest"); provided, however, that with
respect to the first Distribution Date, Class B Monthly Interest will be equal
to interest accrued on the initial outstanding principal balance of the Class B
Certificates at the Class B Certificate Rate from the Closing Date through
January 14, 1998; provided further, however, that in addition to the Class B
Monthly Interest an amount equal to the amount of any unpaid Class B Deficiency
Amounts, as defined below, plus an amount equal to the product of (A) a
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 sum of the Class B
Certificate Rate and 2.0% per annum, and (C) any Class B Deficiency Amount from
the prior Distribution Date, as defined below (or the portion thereof which has
not theretofore been paid to Class B Certificateholders) (the "Class B
Additional Interest") shall also be distributable in respect of the Class B
Certificates. The "Class B Deficiency Amount" for any Distribution Date shall be
equal to the excess, if any, of the aggregate amount accrued pursuant to this
subsection 4.6(b) for all prior Interest Periods over the amount actually paid
to the Class B Certificateholders in respect of such amounts.
(c) The amount of monthly interest distributable in respect of the
Class C Certificates on each 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 C Certificate Rate in effect with respect to the related Interest Period,
and (iii) the Class C Investor Interest determined as of the Record Date
preceding such Distribution Date (the "Class C Monthly Interest"); provided,
however, that in addition to the Class C Monthly Interest an amount equal to any
unpaid Class C Deficiency Amounts, as defined below, shall also be distributed
to the Class C Certificateholders. The "Class C Deficiency Amount" for any
Distribution Date shall be equal to the excess, if any, of the aggregate amount
accrued pursuant to this subsection 4.6(c) for all prior Interest Periods over
the amount actually paid to the Class C Certificateholders in respect of such
amounts.
(d) The amount of monthly interest distributable in respect of the
Class D Certificates on each Distribution Date shall be an amount equal to the
product of (i) a fraction,
26
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 D Certificate Rate in
effect with respect to the related Interest Period, and (iii) the Class D
Investor Interest determined as of the Record Date preceding such Distribution
Date (the "Class D Monthly Interest").
SECTION 1.4. DETERMINATION OF MONTHLY PRINCIPAL.
1.4.0.1. The amount of monthly principal distributable with
respect to the Class A Certificates or to be deposited into the
Principal Funding Account on each Distribution Date (the "Class A
Monthly Principal"), beginning with the Distribution Date in the month
following the month in which the Accumulation Period or, if earlier,
the Early Amortization Period, begins, shall be equal to the least of
(i) the Available Principal Collections with respect to such
Distribution Date, (ii) for each Distribution Date with respect to the
Accumulation Period prior to the Class A Expected Final Payment Date,
the Controlled Deposit Amount for such Distribution Date and (iii) the
Class A Adjusted Investor Interest on such Distribution Date prior to
any deposit into the Principal Funding Account on such Distribution
Date (and after taking into account any adjustments to be made on such
Distribution Date pursuant to Section 4.10 and Section 4.12).
1.4.0.2. The amount of monthly principal distributable with
respect to the Class B Certificates on each Distribution Date (the
"Class B Monthly Principal") beginning with the Distribution Date
following the Due Period in which the Class A Investor Interest has
been paid in full, and during the Early Amortization Period, beginning
with the Distribution Date on which the Class A Investor Interest has
been paid in full, shall be an amount equal to the lesser of (i) the
Available Principal Collections with respect to such Distribution Date
(minus the portion of such Available Principal Collections applied to
Class A Monthly Principal on such Distribution Date) and (ii) the Class
B Investor Interest (after taking into account any adjustments to be
made on such Distribution Date pursuant to Sections 4.10 and 4.12) on
such Distribution Date.
1.4.0.3. The amount of monthly principal distributable with
respect to the Class C Certificates on each Distribution Date (the
"Class C Monthly Principal") shall be, beginning with the Distribution
Date on which the Class B Investor Interest has been paid in full, an
amount equal to the lesser of (i) the Available Principal Collections
with respect to such Distribution Date (minus the portion of such
Available Principal Collections applied to Class A Monthly Principal
and Class B Monthly Principal on such Distribution Date) and (ii) the
Class C Investor Interest (after taking into account any adjustments to
be made on such Distribution Date pursuant to Sections 4.10 and 4.12)
on such Distribution Date.
1.4.0.4. The amount of monthly principal distributable with
respect to the Class D Certificates on each Distribution Date (the
"Class D Monthly Principal") shall be, beginning with the Distribution
Date on which the Class C Investor Interest has been paid in full, an
amount equal to the lesser of (i) the Available Principal Collections
with respect to such Distribution Date (minus the portion of such
Available Principal Collections applied to Class A Monthly Principal,
Class B Monthly Principal and Class C Monthly Principal on such
Distribution Date) and (ii) the Class D Investor Interest (after taking
into account any
27
adjustments to be made on such Distribution Date pursuant to Sections
4.10 and 4.12) on such Distribution Date.
SECTION 1.5. COVERAGE OF CLASS A AND CLASS B REQUIRED AMOUNTS.
1.5.0.1. On or before each Distribution Date, the Servicer shall
determine the amount (the "Class A Required Amount"), if any, by which
the sum of (i) the Class A Monthly Interest for such Distribution Date,
plus (ii) the Class A Deficiency Amount, if any, for such Distribution
Date, plus (iii) the Class A Additional Interest, if any, for such
Distribution Date, plus (iv) the Class A Servicing Fee for the prior
Due Period, plus (v) the Class A Servicing Fee, if any, due but not
paid on any prior Distribution Date, plus (vi) the Class A Investor
Loss Amount, if any, for the prior Due Period, exceeds the Class A
Available Funds for the related Due Period.
1.5.0.2. On or before each Distribution Date, the Servicer shall
also determine the amount (the "Class B Required Amount"), if any, by
which the sum of (i) the Class B Monthly Interest for such Distribution
Date, plus (ii) the Class B Deficiency Amount, if any, for such
Distribution Date, plus (iii) the Class B Additional Interest, if any,
for such Distribution Date, plus (iv) the Class B Servicing Fee for the
prior Due Period, plus (v) the Class B Servicing Fee, if any, due but
not paid on any prior Distribution Date, plus (vi) the Class B Investor
Loss Amount, if any, for the prior Due Period, exceeds the Class B
Available Funds for the related Due Period.
1.5.0.3. In the event that the Class A Required Amount or the
Class B Required Amount for such Distribution Date is greater than
zero, the Servicer shall give written notice to the Trustee of such
positive Class A Required Amount or Class B Required Amount on or
before such Distribution Date. For any Distribution Date other than
Distribution Dates relating to the Early Amortization Period, in the
event that the Class A Required Amount for such Distribution Date is
greater than zero, all or a portion of the Excess Spread and Shared
Excess Finance Charge Collections with respect to such Distribution
Date in an amount equal to the Class A Required Amount, to the extent
available, for such Distribution Date shall be distributed on such
Distribution Date pursuant to subsection 4.11(a). In the event that the
Class A Required Amount for such Distribution Date exceeds the amount
of Excess Spread and Shared Excess Finance Charge Collections with
respect to such Distribution Date, the Collections of Principal
Receivables allocable to the Class D Certificates, the Collections of
Principal Receivables allocable to the Class C Certificates and the
Collections of Principal Receivables allocable to the Class B
Certificates with respect to the prior Due Period shall be applied as
specified in Section 4.12. In the event that the Class B Required
Amount for such Distribution Date exceeds the amount of Excess Spread
and Shared Excess Finance Charge Collections available to fund the
Class B Required Amount pursuant to subsection 4.11(c), the Collections
of Principal Receivables allocable to the Class D Certificates and the
Collections of Principal Receivables allocable to the Class C
Certificates (after application, in each case, to the Class A Required
Amount) shall be applied as specified in Section 4.12; provided,
however, that the sum of any payments pursuant to this paragraph shall
not exceed the sum of the Class A Required Amount and the Class B
Required Amount.
28
SECTION 1.6. MONTHLY PAYMENTS. On or before each Distribution
Date, the Servicer shall instruct the Trustee in writing (which writing shall be
substantially in the form of Exhibit B hereto) to withdraw and the Trustee,
acting in accordance with such instructions, shall withdraw on such Distribution
Date, to the extent of available funds, the amounts required to be withdrawn
from the Collection Account as follows:
1.6.0.1. An amount equal to the Class A Available Funds for the
related Due Period shall be distributed on each Distribution Date in the
following priority:
1.6.0.1.1. an amount equal to Class A Monthly Interest for such
Distribution Date, plus the amount of any Class A Deficiency Amount
for such Distribution Date, plus the amount of any Class A Additional
Interest for such Distribution Date, shall be distributed to the
Class A Certificateholders;
1.6.0.1.2. an amount equal to the Class A Servicing Fee for such
Distribution Date plus the amount of any Class A Servicing Fee due
but not paid to the Servicer on any prior Distribution Date shall be
distributed to the Servicer;
1.6.0.1.3. an amount equal to the Class A Investor Loss Amount, if
any, for the preceding Due Period shall be treated as a portion of
Available Principal Collections for such Distribution Date; and
1.6.0.1.4. the balance, if any, shall constitute Excess Spread and
shall be allocated and distributed as set forth in Section 4.11.
1.6.0.2. An amount equal to the Class B Available Funds for the
related Due Period shall be distributed on each Distribution Date in the
following priority:
1.6.0.2.1. an amount equal to the Class B Monthly Interest for
such Distribution Date, plus the amount of any Class B Deficiency
Amount for such Distribution Date, plus the amount of any Class B
Additional Interest for such Distribution Date, shall be distributed
to the Class B Certificateholders;
1.6.0.2.2. an amount equal to the Class B Servicing Fee for such
Distribution Date, plus the amount of any Class B Servicing Fee due
but not paid to the Servicer on any prior Distribution Date shall be
distributed to the Servicer; and
1.6.0.2.3. an amount equal to the Class B Investor Loss Amount, if
any, for the preceding Due Period shall be treated as a portion of
Available Principal Collections for such Distribution Date; and
1.6.0.2.4. the balance, if any, shall constitute Excess Spread and
shall be allocated and distributed as set forth in Section 4.11.
29
1.6.0.3. An amount equal to the Class C Available Funds for the
related Due Period shall be distributed on each Distribution Date in the
following priority:
1.6.0.3.1. an amount equal to the Class C Servicing Fee for such
Distribution Date plus the amount of any Class C Servicing Fee due
but not paid to the Servicer on any prior Distribution Date shall be
distributed to the Servicer; and
1.6.0.3.2. the balance, if any, shall constitute Excess Spread and
shall be allocated and distributed as set forth in Section 4.11.
1.6.0.4. An amount equal to the Class D Available Funds for the
related Due Period shall be distributed on each Distribution Date in the
following priority:
1.6.0.4.1. an amount equal to the Class D Servicing Fee for such
Distribution Date plus the amount of any Class D Servicing Fee due
but not paid to the Servicer on any prior Distribution Date shall be
distributed to the Servicer; and
1.6.0.4.2. the balance, if any, shall constitute Excess Spread and
shall be allocated and distributed as set forth in Section 4.11.
1.6.0.5. During the Revolving Period, an amount equal to the
Available Principal Collections for the related Due Period shall be
distributed on each Distribution Date in the following priority:
1.6.0.5.1. an amount equal to any amounts required to be applied
on such date from Available Principal Collections pursuant to the
Class C Purchase Agreement shall be so applied;
1.6.0.5.2. an amount equal to the lesser of (A) Available
Principal Collections for such Distribution Date after giving effect
to the applications specified in subsections 4.9(e)(i) above, (B) the
product of (1) a fraction, the numerator of which is equal to the
Available Principal Collections and the denominator of which is equal
to the sum of the Available Principal Collections available for
sharing as specified in the related Supplement and Receivables
Purchase Agreement for each Series (including this Series 1997-1) in
Group One that are Principal Sharing Series and (2) the Cumulative
Principal Shortfall and (C) Available Principal Collections, shall be
treated as Shared Principal Collections and applied to Series in
Group One that are Principal Sharing Series other than this Series
1997-1; and
1.6.0.5.3. subject to Section 4.21(c), an amount equal to the
excess, if any, of (A) the Available Principal Collections for such
Distribution Date over (B) the applications specified in subsections
4.9(e)(i) and (ii) above shall be paid to the Holder of the
Exchangeable Seller Certificate; provided, however, that in no event
shall the amount payable to the Holder of the Exchangeable Seller
Certificate pursuant to this subsection 4.9(e)(iii) be greater than
the Seller Interest on such Distribution Date.
30
1.6.0.6. During the Accumulation Period or the Early Amortization
Period, an amount equal to the Available Principal Collections for the
related Due Period shall be distributed on each Distribution Date in the
following priority:
1.6.0.6.1. an amount equal to the Class A Monthly Principal for
such Distribution Date shall be (A) during the Accumulation Period,
deposited into the Principal Funding Account, and (B) during the
Early Amortization Period, distributed to the Class A
Certificateholders;
1.6.0.6.2. after giving effect to the distribution referred to in
clause (i) above, an amount equal to the Class B Monthly Principal
shall be distributed to the Class B Certificateholders;
1.6.0.6.3. after giving effect to the distribution referred to in
clauses (i) and (ii) above, an amount equal to the Class C Monthly
Principal shall be distributed to the Class C Certificateholders in
accordance with the Class C Purchase Agreement;
1.6.0.6.4. after giving effect to the distributions referred to in
clauses (i), (ii) and (iii) above, an amount equal to the Class D
Monthly Principal shall be distributed to the Class D
Certificateholders;
1.6.0.6.5. after giving effect to the distribution referred to in
clause (i), (ii), (iii) and (iv) above, an amount equal to any
amounts required to be applied from Available Principal Collections
on such date pursuant to the Class C Purchase Agreement shall be so
applied;
1.6.0.6.6. an amount equal to the lesser of (A) the product of (1)
a fraction, the numerator of which is equal to the Available
Principal Collections remaining after the application specified in
clauses (i), (ii), (iii), (iv) and (v) above and the denominator of
which is equal to the sum of the Available Principal Collections
available for sharing as specified in the related Supplement or
Receivables Purchase Agreement for each Series (including this Series
1997-1) in Group One which is a Principal Sharing Series and (2) the
Cumulative Principal Shortfall and (B) the Available Principal
Collections, shall be treated as Shared Principal Collections and
applied to Series in Group One which are Principal Sharing Series
other than this Series 1997-1; and
1.6.0.6.7. an amount equal to the excess, if any, of (A) the
Available Principal Collections over (B) the applications specified
in clauses (i) through (vi) above shall be paid to the Holder of the
Exchangeable Seller Certificate; provided, however, that in no event
shall the amount payable to the Holder of the Exchangeable Seller
Certificate pursuant to this subsection 4.9(f)(vii) be greater than
the Seller Interest on such Distribution Date.
1.6.0.7. On the earlier to occur of (i) the Distribution Date in
the month following the commencement of the Early Amortization Period and
(ii) the Class A Expected
31
Final Payment Date, the Trustee, acting in accordance with instructions
from the Servicer, shall withdraw from the Principal Funding Account and
distribute to the Class A Certificateholders the amount on deposit in the
Principal Funding Account.
SECTION 1.7. INVESTOR CHARGE-OFFS.
1.7.0.1. On or before each Distribution Date, the Servicer shall
calculate the Class A Investor Loss Amount. If on any Distribution Date,
the Class A Investor Loss Amount for the prior Due Period exceeds the sum
of the amounts allocated with respect thereto pursuant to subsection
4.9(a)(iii), subsection 4.11(a) and Section 4.12 with respect to such Due
Period, the Class D Investor Interest (after giving effect to reductions
for any Class D Investor Charge-Offs and any Reallocated Class D
Principal Collections on such Distribution Date) will be reduced by the
amount of such excess. In the event that such reduction would cause the
Class D Investor Interest to be a negative number, the Class D Investor
Interest will be reduced to zero, and the Class C Investor Interest
(after giving effect to reductions for any Class C Investor Charge-Offs
and any Reallocated Class C Principal Collections on such Distribution
Date) will be reduced by the amount by which the Class D Investor
Interest would have been reduced below zero. In the event that such
reduction would cause the Class C Investor Interest to be a negative
number, the Class C Investor Interest will be reduced to zero, and the
Class B Investor Interest (after giving effect to reductions for any
Class B Investor Charge-Offs and any Reallocated Class B Principal
Collections on such Distribution Date) will be reduced by the amount by
which the Class C Investor Interest would have been reduced below zero.
In the event that such reduction would cause the Class B Investor
Interest to be a negative number, the Class B Investor Interest will be
reduced to zero, and the Class A Investor Interest will be reduced by the
amount by which the Class B Investor Interest would have been reduced
below zero, but not by more than the Class A Investor Loss Amount for
such Distribution Date (a "Class A Investor Charge-Off"). If the Class A
Investor Interest has been reduced by the amount of any Class A Investor
Charge-Offs, it will be reimbursed on any Distribution Date (but not by
an amount in excess of the aggregate Class A Investor Charge-Offs) by the
amount of Excess Spread allocated and available for such purpose pursuant
to subsection 4.11(b).
1.7.0.2. On or before each Distribution Date, the Servicer shall
calculate the Class B Investor Loss Amount. If on any Distribution Date,
the Class B Investor Loss Amount for the prior Due Period exceeds the
amounts allocated with respect thereto pursuant to sub- section
4.9(b)(iii), subsection 4.11(c) and Section 4.12 with respect to such Due
Period, the Class D Investor Interest (after giving effect to reductions
for any Class D Investor Charge-Offs and any Reallocated Class D
Principal Collections on such Distribution Date and any adjustments with
respect thereto as described in subsection 4.10(a) above) will be reduced
by the amount of such excess. In the event that such reduction would
cause the Class D Investor Interest to be a negative number, the Class D
Investor Interest will be reduced to zero, and the Class C Investor
Interest (after giving effect to reductions for any Class C Investor
Charge-Offs and any Reallocated Class C Principal Collections on such
Distribution Date and any adjustment with respect thereto as described in
subsection 4.10(a) above) will be reduced by the amount by which the
Class D Investor Interest would have been reduced below zero. In the
event that such reduction would cause the Class C Investor
32
Interest to be a negative number, the Class C Investor Interest shall be
reduced to zero and the Class B Investor Interest shall be reduced by the
amount by which the Class C Investor Interest would have been reduced
below zero, but not by more than the Class B Investor Loss Amount for
such Distribution Date (a "Class B Investor Charge-Off"). The Class B
Investor Interest will also be reduced by the amount of Reallocated Class
B Principal Collections in excess of the Class C Investor Interest
pursuant to Section 4.12 and the amount of any portion of the Class B
Investor Interest allocated to the Class A Certificates to avoid a
reduction in the Class A Investor Interest pursuant to subsection 4.10(a)
above. The Class B Investor Interest will thereafter be reimbursed (but
not to an amount in excess of the unpaid principal balance of the Class B
Certificates) on any Distribution Date by the amount of Excess Spread
allocated and available for that purpose as described under subsection
4.11(d).
1.7.0.3. On or before each Distribution Date, the Servicer shall
calculate the Class C Investor Loss Amount. If on any Distribution Date,
the Class C Investor Loss Amount for the prior Due Period exceeds the
amount of Excess Spread, Shared Excess Finance Charge Collections and
Reallocated Class D Principal Collections which are allocated and
available to fund such amount pursuant to subsection 4.11(g) and Section
4.12, the Class D Investor Interest (after giving effect to reductions
for any Class D Investor Charge-Offs and any Reallocated Class D
Principal Collections on such Distribution Date and any adjustments
thereto as described in subsection 4.10(a) or (b) above) will be reduced
by the amount of such excess. In the event that such reduction would
cause the Class D Investor Interest to be a negative number, the Class D
Investor Interest will be reduced to zero, and the Class C Investor
Interest (after giving effect to reductions for any Class C Investor
Charge-Offs and any Reallocated Class C Principal Collections on such
Distribution Date and any adjustments with respect thereto as described
in subsection 4.10(a) or 4.10(b) above) will be reduced by the amount by
which the Class D Investor Interest would have been reduced below zero (a
"Class C Investor Charge-Off"). The Class C Investor Interest will also
be reduced by the amount of Reallocated Class C Principal Collections
pursuant to Section 4.12 and the amount of any portion of the Class C
Investor Interest allocated to the Class A Certificates or the Class B
Certificates to avoid a reduction in the Class A Investor Interest,
pursuant to subsection 4.10(a), or the Class B Investor Interest,
pursuant to subsection 4.10(b), respectively. The Class C Investor
Interest will thereafter be reimbursed on any Distribution Date by the
amount of the Excess Spread allocated and available under subsection
4.11(h).
1.7.0.4. On or before each Distribution Date, the Servicer shall
calculate the Class D Investor Loss Amount. If on any Distribution Date,
the Class D Investor Loss Amount for the prior Due Period exceeds the
amount of Excess Spread which is allocated and available to fund such
amount pursuant to subsection 4.11(n), the Class D Investor Interest will
be reduced by the amount of such excess (a "Class D Investor
Charge-Off"). The Class D Investor Interest will also be reduced by the
amount of Class D Reallocated Principal Collections pursuant to Section
4.12 and the amount of any portion of the Class D Investor Interest
allocated to the Class A Certificates, the Class B Certificates or the
Class C Certificates to avoid a reduction in the Class A Investor
Interest, pursuant to subsection 4.10(a), the Class B Investor Interest,
pursuant to subsection 4.10(b), or the Class C Investor Interest,
pursuant to Section 4.10(c), respectively. The Class D Investor Interest
will
33
thereafter be reimbursed on any Distribution Date by the amount of the
Excess Spread allocated and available for that purpose as described under
subsection 4.11(o).
SECTION 1.8. EXCESS SPREAD; SHARED EXCESS FINANCE CHARGE
COLLECTIONS. On or before each Distribution Date, the Servicer shall instruct
the Trustee in writing (which writing shall be substantially in the form of
Exhibit B hereto) to apply Excess Spread and Shared Excess Finance Charge
Collections allocated to Series 1997-1 with respect to the related Due Period to
make the following distributions on each Distribution Date in the following
priority:
1.8.0.1. an amount equal to the Class A Required Amount, if any,
with respect to such Distribution Date shall be used to fund the Class A
Required Amount and be applied in accordance with, and in the priority
set forth in, subsection 4.9(a);
1.8.0.2. an amount equal to the aggregate amount of Class A
Investor Charge-Offs which have not been previously reimbursed shall be
treated as a portion of Available Principal Collections for such
Distribution Date;
1.8.0.3. an amount equal to the Class B Required Amount, if any,
with respect to such Distribution Date shall be used to fund the Class B
Required Amount and be applied in accordance with, and in the priority
set forth in, subsection 4.9(b);
1.8.0.4. an amount equal to the aggregate amount by which the
Class B Investor Interest has been reduced below the Class B Initial
Investor Interest for reasons other than the payment of principal to the
Class B Certificateholders (but not in excess of the aggregate amount of
such reductions which have not been previously reimbursed) shall be
treated as a portion of Available Principal Collections for such
Distribution Date;
1.8.0.5. an amount equal to the excess, if any, of the Class C
Servicing Fee for such Distribution Date plus the amount of any Class C
Servicing Fee due but not paid to the Servicer on any prior Distribution
Date over the Class C Available Funds for such Distribution Date shall be
paid to the Servicer;
1.8.0.6. an amount equal to the Class C Monthly Interest plus the
Class C Deficiency Amount for such Distribution Date shall be distributed
to the Class C Certificateholders in accordance with the Class C Purchase
Agreement;
1.8.0.7. an amount equal to the Class C Investor Loss Amount, if
any, for the prior Due Period shall be treated as a portion of Available
Principal Collections for such Distribution Date;
1.8.0.8. an amount equal to the aggregate amount by which the
Class C Investor Interest has been reduced below the Class C Initial
Investor Interest for reasons other than the payment of principal to the
Class C Certificateholders (but not in excess of the aggregate amount of
such reductions which have not been previously reimbursed) shall be
treated as a portion of Available Principal Collections for such
Distribution Date;
34
1.8.0.9. [Reserved];
1.8.0.10. an amount up to the excess, if any, of the Series Excess
Funding Reserve Account Required Amount over the amount on deposit in the
Series Excess Funding Reserve Account shall be deposited into the Series
Excess Funding Reserve Account;
1.8.0.11. an amount equal to the aggregate of any other amounts
then due to the Class C Certificateholders or required to be applied
pursuant to the Class C Purchase Agreement out of Excess Spread and
Shared Excess Finance Charge Collections allocated to Series 1997-1
pursuant to the Class C Purchase Agreement shall be distributed for
application in accordance with the Class C Purchase Agreement;
1.8.0.12. an amount equal to the excess, if any, of the Class D
Servicing Fee over the Class D Available Funds for such Distribution Date
shall be paid to the Servicer;
1.8.0.13. an amount equal to the Class D Monthly Interest plus the
amount of any past due Class D Monthly Interest for such Distribution
Date shall be distributed to the Class D Certificateholders;
1.8.0.14. an amount equal to the Class D Investor Loss Amount, if
any, for the prior Due Period shall be treated as a portion of Available
Principal Collections for such Distribution Date;
1.8.0.15. an amount equal to the aggregate amount by which the
Class D Investor Interest has been reduced below the Class D Initial
Investor Interest for reasons other than the payment of principal to the
Class D Certificateholders (but not in excess of the aggregate amount of
such reductions which have not been previously reimbursed) shall be
treated as a portion of Available Principal Collections for such
Distribution Date; and
1.8.0.16. the balance, if any, will constitute a portion of Shared
Excess Finance Charge Collections for such Distribution Date and will be
available for allocation to other Series in Group One and, to the extent
not required to be applied as Shared Excess Finance Charge Collections
with respect to any Series in Group One, shall be distributed to the
Holder of the Exchangeable Seller Certificate.
SECTION 1.9. REALLOCATED PRINCIPAL COLLECTIONS. On or before each
Distribution Date, the Servicer shall instruct the Trustee in writing (which
writing shall be substantially in the form of Exhibit B hereto) to apply
Reallocated Principal Collections (applying all Reallocated Class C Principal
Collections in accordance with subsections 4.12(a) and (b) prior to applying any
Reallocated Class B Principal Collections in accordance with subsection 4.12(a)
for any amounts still owing after the application of Reallocated Class C
Principal Collections and applying all Reallocated Class D Principal Collections
in accordance with subsections 4.12(a), (b) and (c) prior to applying any
Reallocated Class C Principal Collections in accordance with subsections 4.12(a)
or (b) for any amounts still owing after the application of Reallocated Class D
Principal Collections)
35
with respect to such Distribution Date, to make the following distributions on
each Distribution Date in the following priority:
1.9.0.1. an amount equal to the excess, if any, of (i) the Class A
Required Amount, if any, with respect to such Distribution Date over (ii)
the amount of Excess Spread and Shared Excess Finance Charge Collections
allocated to Series 1997-1 with respect to the related Due Period, shall
be applied in accordance with, and in the priority set forth in,
subsections 4.9(a)(i), (ii) and (iii);
1.9.0.2. an amount equal to the excess, if any, of (i) the Class B
Required Amount, if any, with respect to such Distribution Date over (ii)
the amount of Excess Spread and Shared Excess Finance Charge Collections
allocated and available to the Class B Certificates pursuant to
subsection 4.11(c) on such Distribution Date shall be applied in
accordance with, and in the priority set forth in subsections 4.9(b)(i),
(ii) and (iii); and
1.9.0.3. an amount equal to the excess, if any, of (i) the Class C
Required Amount, if any, with respect to such Distribution Date over (ii)
the amount of Excess Spread and Shared Excess Finance Charge Collections
allocated and available to the Class C Investor Interest pursuant to
subsections 4.11(e), 4.11(f) and 4.11(g) on such Distribution Date shall
be applied first pursuant to subsection 4.9(c)(i), and then pursuant to
and in the priority set forth in subsections 4.11(f) and 4.11(g).
On each Distribution Date, the Class D Investor Interest shall be
reduced by the amount of Reallocated Class D Principal Collections for such
Distribution Date, the Class C Investor Interest shall be reduced by the amount
of Reallocated Class C Principal Collections for such Distribution Date, and the
Class B Investor Interest shall be reduced by the amount of Reallocated Class B
Principal Collections for such Distribution Date.
SECTION 1.10. SELLER'S OR SERVICER'S FAILURE TO MAKE A DEPOSIT OR
PAYMENT. If the Servicer or the Seller fails to make, or give instructions to
make, any payment or deposit required to be made or given by the Servicer or
Seller, respectively, at the time specified in the Agreement (including
applicable grace periods), the Trustee shall make such payment or deposit from
the applicable account without instruction from the Servicer or Seller. The
Trustee shall be required to make any such payment, deposit or withdrawal
hereunder only to the extent that the Trustee has sufficient information to
allow it to determine the amount thereof; provided, however, that the Trustee
shall in all cases be deemed to have sufficient information to determine the
amount of interest payable to the Investor Certificateholders on each
Distribution Date. The Servicer shall, upon request of the Trustee, promptly
provide the Trustee with all information necessary to allow the Trustee to make
such payment, deposit or withdrawal. Such funds or the proceeds of such
withdrawal shall be applied by the Trustee in the manner in which such payment
or deposit should have been made by the Seller or the Servicer, as the case may
be.
36
SECTION 1.11. SHARED EXCESS FINANCE CHARGE COLLECTIONS.
1.11.0.1. The balance of any Available Funds on deposit in the
Collection Account after giving effect to subsections 4.11(a) through (o)
will constitute a portion of Shared Excess Finance Charge Collections and
will be available for allocation to other Series in Group One or to the
Holder of the Exchangeable Seller Certificate as described in Section
4.3(g).
(b) Series 1997-1 shall be included in Group One. Subject to
subsection 4.3(g) of the Agreement, Shared Excess Finance Charge Collections
with respect to the Series in Group One for any Distribution Date will be
allocated to Series 1997-1 in an amount equal to the product of (x) the
aggregate amount of Shared Excess Finance Charge Collections with respect to all
Series in Group One for such Distribution Date and (y) a fraction, the numerator
of which is the Finance Charge Shortfall for Series 1997-1 for such Distribution
Date and the denominator of which is the aggregate amount of Finance Charge
Shortfalls for all Series in Group One for such Distribution Date. The "Finance
Charge Shortfall" for Series 1997-1 for any Distribution Date will be equal to
the excess, if any, of (a) the full amount required to be paid, without
duplication, pursuant to subsections 4.11(a) through (o) on such Distribution
Date over (b) the Available Funds for such Distribution Date.
SECTION 1.12. SHARED PRINCIPAL COLLECTIONS. Subject to subsection
4.3(f) of the Agreement, Shared Principal Collections for any Distribution Date
will be allocated to Series 1997-1 in an amount equal to the product of (x) the
aggregate amount of Shared Principal Collections with respect to all Series in
Group One that are Principal Sharing Series for such Distribution Date and (y) a
fraction, the numerator of which is the Principal Shortfall for Series 1997-1
for such Distribution Date and the denominator of which is the Cumulative
Principal Shortfall for such Distribution Date.
37
SECTION 1.13. [Reserved].
SECTION 1.14. THE PRINCIPAL FUNDING ACCOUNT.
1.14.0.1. The Trustee, for the benefit of the Class A
Certificateholders, shall establish or shall cause to be established and
maintained with a Qualified Depository Institution in the name of the
Trustee, on behalf of the Trust, a segregated trust 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. The Principal Funding Account shall be under the sole
dominion and control of the Trustee for the benefit of the Investor
Certificateholders. If, at any time, the institution holding the
Principal Funding Account ceases to be a Qualified Depository
Institution, the Seller shall notify the Trustee and the Trustee upon
being notified shall, promptly (but, in any event within twenty Business
Days) establish a new Principal Funding Account meeting the conditions
specified above with a Qualified Depository Institution, transfer any
cash or any investments to such new Principal Funding Account and from
the date such new Principal Funding Account is established, it shall be
the "Principal Funding Account." Neither the Seller nor the Servicer, nor
any Person claiming by, through or under the Seller or Servicer, shall
have any right, title or interest in, or any right to withdraw any amount
from, the Principal Funding Account except to the extent provided in this
Supplement and the Agreement. Pursuant to the authority granted to the
Servicer in subsection 3.1(b), the Servicer shall have the revocable
power to instruct the Trustee to make withdrawals and payments from the
Principal Funding Account for the purposes of carrying out the Servicer's
duties under this Supplement.
1.14.0.2. Funds on deposit in the Principal Funding Account shall
be invested by the Trustee at the direction of the Servicer in Permitted
Investments that will mature so that such funds will be available prior
to the Distribution Date following such investment. Any request by the
Servicer to invest funds on deposit in the Principal Funding Account
shall be in writing and shall certify that the requested investment is a
Permitted Investment that matures at or prior to the time required
hereby. The Trustee shall maintain possession of the negotiable
instruments or securities, if any, evidencing such Permitted Investments.
No Permitted Investment shall be disposed of prior to its maturity.
1.14.0.3. On each Distribution Date with respect to the
Accumulation Period, the Trustee, acting at the Servicer's direction
given on the related Determination Date, shall transfer from the
Principal Funding Account to the Collection Account the Principal Funding
Investment Proceeds on such date, for application as Class A Available
Funds for such Distribution Date. Principal Funding Investment Proceeds
shall not be considered to be principal amounts on deposit in the
Principal Funding Account for purposes of this Supplement.
1.14.0.4. On or prior to the Distribution Date commencing 13
months prior to the Class A Expected Final Payment Date, the Seller shall
designate the number of months in the Accumulation Period (the
"Accumulation Period Length") and, correspondingly, the
38
first day of the Due Period on which the Accumulation Period will
commence. The Seller may change such designation at any time prior to the
commencement of the Accumulation Period. The Seller shall provide the
Servicer, the Trustee, the Rating Agencies and the Class C
Certificateholders with notice of each such designation. Such
designations shall be effective hereunder for all purposes if the Seller
shall (i) have provided the Servicer, the Trustee and the Enhancement
Provider evidence that the Rating Agency Condition shall have been
satisfied, and (ii) have delivered to the Trustee a certificate of an
authorized officer to the effect that, based on the facts known to such
officer at such time, in the reasonable belief of the Seller, such
designation will not cause an Early Amortization Event or an event that,
after the giving of notice or the lapse of time, would cause an Early
Amortization Event to occur with respect to Series 1997-1.
SECTION 1.15. DETERMINATION OF LIBOR.
1.15.0.1. On each LIBOR Determination Date, the Trustee will
determine LIBOR on the basis of the rate for deposits in United States
dollars for a one-month period which appears on Telerate page 3750 as of
11:00 a.m., London time, on such date. If such rate does not appear on
Telerate Page 3750, the rate for that LIBOR Determination Date will be
determined on the basis of the rates at which deposits in United States
dollars are offered by the Reference Banks at approximately 11:00 a.m.,
London time, on that day to prime banks in the London interbank market
for a one-month period. The Trustee will request the principal London
office of each of the Reference Banks to provide a quotation of its rate.
If at least two such quotations are provided, the rate for that LIBOR
Determination Date will be the arithmetic mean of the quotations. If
fewer than two quotations are provided as requested, the rate for that
LIBOR Determination Date will be the arithmetic mean of the rates quoted
by major banks in New York City, selected by the Servicer, at
approximately 11:00 a.m., New York City time, on that day for loans in
United States dollars to leading European banks for a one-month period.
1.15.0.2. The Class A Certificate Rate and the Class B Certificate
Rate applicable to the then current and the immediately preceding
Interest Periods may be obtained by any Investor Certificateholder by
telephoning the Trustee at its Corporate Trust Office at (000) 000-0000.
1.15.0.3. On each LIBOR Determination Date prior to 12:00 noon New
York City time, the Trustee shall send to the Servicer by facsimile,
notification of LIBOR for the following Interest Period.
39
SECTION 1.16. INTEREST RATE CAPS.
1.16.0.1. The Servicer hereby represents that Fashion Service Corp
has obtained and assigned to the Trust (i) the Class A Cap in favor of
the Trust for the benefit of the Class A Certificateholders and (ii) the
Class B Cap in favor of the Trust for the benefit of the Class B
Certificateholders, the Class C Certificateholders and the Class D
Certificateholders. The Class A Cap shall entitle the Trust to receive
monthly the Class A Cap Payment, if any, as set forth in the Class A Cap.
The Class B Cap shall entitle the Trust to receive monthly the Class B
Cap Payment, if any, as set forth in the Class B Cap.
1.16.0.2. Upon the effectiveness of any Replacement Interest Rate
Cap, the Interest Rate Cap being replaced shall terminate and the
applicable Interest Rate Cap Provider shall be released of all future
obligations thereunder, provided that such Interest Rate Cap shall not be
released from any obligations which have previously accrued thereunder
and shall continue to be obligated to perform such obligations.
1.16.0.3. The Trustee hereby appoints the Servicer to act as
calculation agent under the Interest Rate Caps and the Servicer accepts
such appointment.
SECTION 1.17. PAIRED SERIES. Any other Series in Group One may be
designated (but only with the consent of the Class C Certificateholders) as a
Paired Series for Series 1997-1. Such Paired Series either shall be prefunded
with an initial deposit to a prefunding account in an amount up to the initial
principal balance of such Paired Series and primarily from the sale of such
Paired Series or shall have a variable principal amount. Any such prefunding
account shall be held for the benefit of such Paired Series and not for the
benefit of the Series 1997-1 Certificateholders. As funds in the Collection
Account are allocated for distribution as Available Principal Collections during
the Early Amortization Period or Accumulation Period, either (i) in the case of
a prefunded Paired Series, an equal amount of funds in any prefunding account
for such Paired Series shall be released and distributed pursuant to the terms
of such Paired Series or (ii) in the case of a Paired Series having a variable
principal amount, an interest in such variable Paired Series in an equal or
lesser amount may be sold by the Trust and the proceeds thereof will be
distributed pursuant to the terms of such Paired Series, and, in either case,
the Series Investor Interest of such Paired Series will increase by up to a
corresponding amount. Upon payment in full of the Series 1997-1 Certificates and
payment of all amounts due to the Class C Certificateholders, assuming that
there have been no unreimbursed Loss Amounts with respect to any related Paired
Series, the aggregate amount of such Paired Series shall have been increased by
an amount up to an aggregate amount equal to the Series Investor Interest paid
to the Series 1997-1 Certificateholders and the Class C Certificateholders (or
such other amount as the holders of such Paired Series shall agree).
40
SECTION 1.18. SERIES EXCESS FUNDING ACCOUNT.
1.18.0.1. The Servicer, for the benefit of the Investor
Certificateholders, shall establish and maintain in the name of the
Trustee, on behalf of the Trust, a segregated trust account with a
Qualified Depository Institution bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the Investor
Certificateholders (the "Series Excess Funding Account"). The Trustee
shall possess all right, title and interest in all funds on deposit from
time to time in the Series Excess Funding Account and in all proceeds
thereof. The Series Excess Funding Account shall be under the sole
dominion and control of the Trustee for the benefit of the Investor
Certificateholders. Except as expressly provided in this Agreement, the
Servicer agrees that it shall have no right of setoff or banker's lien
against, and no right to otherwise deduct from, any funds held in the
Series Excess Funding Account for any amount owed to it by the Trustee,
the Trust, or any Investor Certificateholder. If, at any time, the
institution holding the Series Excess Funding Account ceases to be a
Qualified Depository Institution, the Trustee upon notice by the Servicer
(or the Servicer on its behalf) shall promptly (but in any event within
20 Business Days) establish a new Series Excess Funding Account with a
Qualified Depository Institution meeting the conditions specified above,
transfer any cash or any investments to such new Series Excess Funding
Account and from the date such new Series Excess Funding Account is
established, it shall be the "Series Excess Funding Account."
1.18.0.2. On the Closing Date, the Servicer shall deposit into the
Series Excess Funding Account an amount equal to the Series Excess
Funding Account Required Amount. Funds on deposit in the Series Excess
Funding Account shall at the direction of the Servicer be invested by the
Trustee in Permitted Investments selected by the Servicer. All such
Permitted Investments shall be held by the Trustee for the benefit of the
Investor Certificateholders. The Trustee shall maintain for the benefit
of the Investor Certificateholders possession of the negotiable
instruments or securities, if any, evidencing such Permitted Investments.
Funds on deposit in the Series Excess Funding Account on any date (after
giving effect to any withdrawals from the Series Excess Funding Account
on such date) will be invested in Permitted Investments that will mature
so that funds will be available at the close of business on the
Distribution Date following such date. On each Determination Date, the
Servicer shall instruct the Trustee to withdraw on the related
Distribution Date from the Series Excess Funding Account and deposit in
the Collection Account all Series Excess Funding Account Investment
Proceeds on funds on deposit in the Series Excess Funding Account, for
application as Available Funds on such Distribution Date.
1.18.0.3. On any day on which, pursuant to subsection 4.3(c), the
Servicer would otherwise pay amounts from Collections in respect of
Principal Receivables to the Holder of the Exchangeable Seller
Certificate, the Servicer shall be entitled to deposit all or part of
such amount into the Series Excess Funding Account, it being understood
that such amount may be attributable to Series 1997-1 or any other
Series. On the Business Day immediately prior to each Determination Date,
Servicer shall reconcile the amounts that were so deposited during the
related Due Period (the "Deposit Amount"), together with other amounts
paid to the Holder of the Exchangeable Seller Certificate or the
Originator pursuant
41
to subsection 4.3(c) during such Due Period in respect of Collections on
Principal Receivables (the "Remitted Amount"), taking into account
amounts required to be allocated on or prior to the related Distribution
Date to each Series (including without limitation any deposit to the
Excess Funding Amount required under subsection 4.3(f) and any
reallocation of Principal Collections required under Section 4.12 of the
Supplement for Series 1997-1 or the comparable section of any other
Supplement). If such reconciliation showed that the sum of the Deposit
Amount plus the Remitted Amount exceeded the aggregate amount permitted
to be paid to the Holder of the Seller Exchangeable Certificate in
respect thereof, the Servicer shall withdraw the amount by which such
excess is greater than the Remitted Amount from the Series Excess Funding
Account on such Business Day and deposit such amount into the Collection
Account for allocation to the appropriate Series.
1.18.0.4. On any Determination Date with respect to the
Accumulation Period or Early Amortization Period, the Servicer shall
determine the aggregate amount of Principal Shortfalls, if any, with
respect to Series 1997-1 (after giving effect to the allocation and
payment provisions herein), and the Servicer shall instruct the Trustee
to withdraw such amount from the Series Excess Funding Account on the
succeeding Distribution Date (up to the amount on deposit therein) and
allocate such amount as Available Principal Collections for such
Distribution Date.
1.18.0.5. On any Determination Date on which a Series Excess
Funding Account Surplus exists (after taking into account all withdrawals
and deposits to be made on the following Distribution Date), the Trustee
shall withdraw such from the Series Excess Funding Account the amount of
such Series Excess Funding Account Surplus on the related Distribution
Date and pay such amount to the Holder of the Exchangeable Seller
Certificate; provided, however, in no event shall the amount payable to
the Holder of the Exchangeable Seller Certificate pursuant to this
subsection 4.21(e) be greater than the Sellers Interest on such
Distribution Date.
1.18.0.6. On each Determination Date on which funds are on deposit
in the Series Excess Funding Account, the Servicer will determine whether
(after giving effect to the withdrawals and deposits provided for in
clauses (c), (d) and (e) above on or prior to the following Distribution
Date) the amount on deposit in the Series Excess Funding Account is equal
to or greater than 20% of the Initial Investor Interest. If such
determination shows the amount on deposit to be equal to or greater than
20% of the Initial Investor Interest on that Determination Date and the
five preceding Determination Dates, on the next Distribution Date the
Trustee shall withdraw funds from the Series Excess Funding Account, in
an amount equal to 20% of the Initial Investor Interest, and distribute
such amount as a payment of principal to the Holders of the Investor
Certificates pro rata based on the Class A Investor Interest, the Class B
Investor Interest, the Class C Investor Interest and the Class D Investor
Interest, respectively.
42
SECTION 1.19. SERIES EXCESS FUNDING RESERVE ACCOUNT.
1.19.0.1. The Servicer shall establish and maintain with a
Qualified Depository Institution, in the name of the Trustee, on behalf
of the Trust, for the benefit of the Investor Certificateholders, a
segregated trust account with the corporate trust department of such
Qualified Depository Institution (the "Series Excess Funding Reserve
Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Investor
Certificateholders. The Trustee shall possess all right, title and
interest in all funds on deposit from time to time in the Series Excess
Funding Reserve Account and in all proceeds thereof. The Series Excess
Funding Reserve Account shall be under the sole dominion and control of
the Trustee for the benefit of the Series 1997-1 Certificateholders. If
at any time the institution holding the Series Excess Funding Reserve
Account ceases to be a Qualified Depository Institution the Seller shall
notify the Trustee and the Trustee upon being notified (or the Servicer
on its behalf) shall promptly (but in any event within 20 Business Days)
establish a new Series Excess Funding Reserve Account meeting the
conditions specified above with a Qualified Depository Institution, and
shall transfer any cash or any investments to such new Series Excess
Funding Reserve Account. The Trustee, at the direction of the Servicer,
shall (i) make withdrawals from the Series Excess Funding Reserve Account
from time to time in an amount up to the Available Series Excess Funding
Reserve Account Amount at such time, for the purposes set forth in this
Supplement, and (ii) on each Distribution Date make a deposit into the
Series Excess Funding Reserve Account in the amount specified in, and
otherwise in accordance with, subsection 4.11(j).
1.19.0.2. Funds on deposit in the Series Excess Funding Reserve
Account shall be invested at the direction of the Servicer by the Trustee
in Permitted Investments. Funds on deposit in the Series Excess Funding
Reserve Account on any Distribution Date, after giving effect to any
withdrawals from the Series Excess Funding Reserve Account on such
Distribution Date, shall be invested in such investments that will mature
so that such funds will be available for withdrawal on or prior to the
following Distribution Date. The Trustee shall maintain for the benefit
of the Investor Certificateholders possession of the negotiable
instruments or securities, if any, evidencing such Permitted Investments.
No Permitted Investment shall be disposed of prior to its maturity. On
each Distribution Date, all interest and earnings (net of losses and
investment expenses) accrued since the preceding Distribution Date on
funds on deposit in the Series Excess Funding Reserve Account shall be
retained in the Series Excess Funding Reserve Account (to the extent that
the Available Series Excess Funding Reserve Account Amount is less than
the Series Excess Funding Reserve Account Required Amount) and the
balance, if any, shall be deposited in the Collection Account for
application as Available Funds on such Distribution Date. For purposes of
determining the availability of funds or the balance in the Series Excess
Funding 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.
1.19.0.3. On the Determination Date preceding each Distribution
Date, the Servicer shall calculate the "Series Excess Funding Reserve
Draw Amount" which shall be
43
equal to the Series Excess Funding Account Investment Shortfall with
respect to such Distribution Date.
1.19.0.4. In the event that for any Distribution Date the Series
Excess Funding Reserve Draw Amount is greater than zero, the Series
Excess Funding Reserve Draw Amount, up to the amount on deposit in the
Series Excess Funding Reserve Account, shall be withdrawn from the Series
Excess Funding Reserve Account on such Distribution Date by the Trustee
(acting in accordance with the instructions of the Servicer), and
deposited into the Collection Account for application as provided herein
on such Distribution Date.
1.19.0.5. In the event that the Series Excess Funding Reserve
Account Surplus on any Distribution Date, after giving effect to all
deposits to and withdrawals from the Series Excess Funding Reserve
Account with respect to such Distribution Date, is greater than zero, the
Trustee, acting in accordance with the instructions of the Servicer,
shall withdraw from the Series Excess Funding Reserve Account and deposit
such Series Excess Funding Reserve Account Surplus in the Collection
Account, for application as Class A Available Funds for such Distribution
Date.
1.19.0.6. Upon the earliest to occur of (i) the termination of the
Trust pursuant to Article XII of the Agreement and (ii) the day on which
the Adjusted Investor Interest is paid in full, the Trustee, acting in
accordance with the instructions of the Servicer, after the prior payment
of all amounts owing to the Investor Certificateholders that are payable
from the Series Excess Funding Reserve Account as provided herein, shall
withdraw from the Series Excess Funding Reserve Account amounts, if any,
on deposit in the Series Excess Funding Reserve Account and pay such
amount to the Holder of the Exchangeable Seller Certificate and the
Series Excess Funding Reserve Account shall be deemed to have terminated
for purposes of this Supplement.
SECTION 1.19.1. ARTICLE V OF THE AGREEMENT. Article V of the
Agreement shall read in its entirety as follows and shall be applicable only to
the Investor Certificates:
ARTICLE 2.
DISTRIBUTIONS AND REPORTS TO INVESTOR
CERTIFICATEHOLDERS; NOTIFICATION OF CAP PAYMENTS
SECTION 2.1. DISTRIBUTIONS.
2.1.0.1. On each Distribution Date, the Trustee shall distribute
(in accordance with the certificate delivered by the Servicer to the
Trustee pursuant to subsection 3.4(b)) to each Class A Certificateholder
of record on the immediately preceding Record Date (other than as
provided in Section 12.3 respecting a final distribution) such
Certificateholder's pro rata share (based on the aggregate Undivided
Trust Interests represented by Class A Certificates held by such
Certificateholder) of amounts on deposit in the Collection Account
44
and the Principal Funding Account as are payable to the Class A
Certificateholders pursuant to Section 4.9 by check mailed to each Class
A Certificateholder (at such Certificateholder's address as it appears in
the Certificate Register), except that with respect to Class A
Certificates registered in the name of the nominee of a Clearing Agency,
such distribution shall be made in immediately available funds.
2.1.0.2. On each Distribution Date, the Trustee shall distribute
(in accordance with the certificate delivered by the Servicer to the
Trustee pursuant to subsection 3.4(b)) to each Class B Certificateholder
of record on the immediately preceding Record Date (other than as
provided in Section 12.3 respecting a final distribution) such
Certificateholder's pro rata share (based on the aggregate Undivided
Trust Interests represented by Class B Certificates held by such
Certificateholder) of amounts on deposit in the Collection Account as are
payable to the Class B Certificateholders pursuant to Section 4.9 by
check mailed to each Class B Certificateholder (at such
Certificateholder's address as it appears in the Certificate Register),
except that with respect to Class B Certificates registered in the name
of the nominee of a Clearing Agency, such distribution shall be made in
immediately available funds.
2.1.0.3. On each Distribution Date, the Trustee shall distribute
(in accordance with the Class C Purchase Agreement) to each Class C
Certificateholder of record on the immediately preceding Record Date
(other than as provided in Section 12.3 respecting a final distribution)
such Certificateholder's pro rata share (based on the aggregate Undivided
Trust Interests represented by Class C Certificates held by such
Certificateholder) of amounts on deposit in the Collection Account as are
payable to the Class C Certificateholders pursuant to the Class C
Purchase Agreement by check mailed to each Class C Certificateholder (at
such Certificateholder's address as it appears in the Certificate
Register) or by wire transfer of immediately available funds to such
account designated in writing by such Certificateholder to the Trustee
not later than the Determination Date preceding such Distribution Date.
2.1.0.4. On each Distribution Date, the Trustee shall distribute
(in accordance with the certificate delivered by the Servicer to the
Trustee pursuant to subsection 3.4(b)) to each Class D Certificateholder
of record on the immediately preceding Record Date (other than as
provided in Section 12.3 respecting a final distribution) such
Certificateholder's pro rata share (based on the aggregate Undivided
Trust Interests represented by Class D Certificates held by such
Certificateholder) of amounts on deposit in the Collection Account as are
payable to the Class D Certificateholders pursuant to Section 4.11 by
check mailed to each Class D Certificateholder (at such
Certificateholder's address as it appears in the Certificate Register) or
by wire transfer of immediately available funds to such account
designated in writing by such Certificateholder to the Trustee not later
than the Determination Date preceding such Distribution Date.
2.1.0.5. The Trustee shall promptly notify the Seller and the
Servicer if it does not receive a payment under any Interest Rate Cap on
the date on which such payment is due pursuant to the terms of such
Interest Rate Cap.
45
SECTION 2.2. MONTHLY CERTIFICATEHOLDERS' STATEMENT.
2.2.0.1. On or before each Distribution Date, the Paying Agent
shall forward to each Series 1997-1 Certificateholder, each Rating Agency
and the Class C Certificateholders a statement substantially in the form
of Exhibit C to this Supplement prepared by the Servicer setting forth,
among other things, the following information (which, in the case of
subclauses (i) and (ii) below, shall be stated on the basis of an
original principal amount of $1,000 per Series 1997-1 Certificate and, in
the case of subclauses (viii) and (ix) shall be stated on an aggregate
basis and on the basis of an original principal amount of $1,000 per
Series 1997-1 Certificate):
2.2.0.1.1. the amount of the current distribution allocable to
Class A Monthly Principal, Class B Monthly Principal, Class C Monthly
Principal and Class D Monthly Principal, respectively;
2.2.0.1.2. the amount of the current distribution allocable to
Class A Monthly Interest, Class A Deficiency Amounts, Class A
Additional Interest, Class B Monthly Interest, Class B Deficiency
Amounts, Class B Additional Interest, Class C Monthly Interest, Class
C Deficiency Amounts, Class D Monthly Interest and any accrued and
unpaid Class D Monthly Interest, respectively;
2.2.0.1.3. the amount of Collections of Principal Receivables
processed during the related Due Period and allocated in respect of
the Class A Certificates, the Class B Certificates, the Class C
Certificates and the Class D Certificates, respectively;
2.2.0.1.4. the amount of Collections of Finance Charge Receivables
processed during the related Due Period and allocated in respect of
the Class A Certificates, the Class B Certificates, the Class C
Certificates and the Class D Certificates, respectively;
2.2.0.1.5. the aggregate amount of Principal Receivables, the
Series Investor Interest, the Series Adjusted Investor Interest, the
Adjusted Investor Interest, the Class A Investor Interest, the Class
A Adjusted Investor Interest, the Class B Investor Interest, the
Class C Investor Interest, the Class D Investor Interest, the
Floating Allocation Percentage, the Class A Floating Allocation, the
Class B Floating Allocation, the Class C Floating Allocation, the
Class D Floating Allocation and the Principal Allocation Percentage,
the Class A Fixed Allocation, the Class B Fixed Allocation, the Class
C Fixed Allocation and the Class D Fixed Allocation with respect to
the Principal Receivables in the Trust as of the end of the day on
the Record Date;
2.2.0.1.6. the aggregate outstanding balance of Accounts which were
30 to 59, 60 to 89, 90 to 119 and 120 or more days delinquent as of
the end of the day on the Record Date;
46
2.2.0.1.7. the Investor Loss Amount, the Class A Investor Loss
Amount, the Class B Investor Loss Amount, the Class C Investor Loss
Amount and the Class D Investor Loss Amount for the related Due
Period;
2.2.0.1.8. the aggregate amount of Class A Investor Charge-Offs,
Class B Investor Charge-Offs, Class C Investor Charge-Offs and Class
D Investor Charge-Offs for the related Due Period;
2.2.0.1.9. the aggregate amount of Class A Investor Charge-Offs,
Class B Investor Charge-Offs, Class C Investor Charge-Offs and Class
D Investor Charge-Offs reimbursed on the Distribution Date
immediately preceding such Distribution Date;
2.2.0.1.10. the amount of the Class A Servicing Fee, the Class B
Servicing Fee, the Class C Servicing Fee and the Class D Servicing
Fee for the related Due Period;
2.2.0.1.11. the Portfolio Yield for the preceding Due Period;
2.2.0.1.12. the amount of Reallocated Class D Principal
Collections, Reallocated Class C Principal Collections and
Reallocated Class B Principal Collections with respect to such
Distribution Date;
2.2.0.1.13. the Class A Investor Interest, the Class B Investor
Interest, the Class C Investor Interest and the Class D Investor
Interest as of the close of business on such Distribution Date;
2.2.0.1.14. LIBOR on such Distribution Date;
2.2.0.1.15. the Principal Funding Account Balance on the related
Distribution Date;
2.2.0.1.16. the Principal Shortfall;
2.2.0.1.17. the Principal Funding Investment Proceeds transferred
to the Collection Account on the related Distribution Date;
2.2.0.1.18. the Principal Funding Investment Shortfall on the
related Distribution Date;
2.2.0.1.19. the amount of Class A Available Funds, Class B
Available Funds, Class C Available Funds and Class D Available Funds
on deposit in the Collection Account on the related Distribution
Date;
2.2.0.1.20. the Series Excess Funding Account Balance on the
related Distribution Date;
47
2.2.0.1.21. the Series Excess Funding Account Investment Proceeds
transferred to the Collection Account on the related Distribution
Date;
2.2.0.1.22. the Series Excess Funding Account Investment Shortfall
on the related Distribution Date;
2.2.0.1.23. the amount on deposit in the Series Excess Funding
Reserve Account and the Series Excess Funding Reserve Account
Required Amount on the related Distribution Date; and
2.2.0.1.24. such other items as are set forth in Exhibit C to this
Supplement.
2.2.0.2. Annual Certificateholders' Tax Statement. On or before
January 31 of each calendar year, beginning with calendar year 1998,
the Trustee shall distribute to each Person who at any time during the
preceding calendar year was a Series 1997-1 Certificateholder, a
statement prepared by the Servicer containing the information required
to be contained in the regular monthly report to Series 1997-1
Certificateholders, as set forth in subclauses (i) and (ii) above,
aggregated for such calendar year or the applicable portion thereof
during which such Person was a Series 1997-1 Certificateholder,
together with such other customary information (consistent with the
treatment of the Class A Certificates and the Class B Certificates as
debt) as the Servicer deems necessary or desirable to enable the Series
1997-1 Certificateholders to prepare their tax returns. The Servicer
will provide such information to the Trustee as soon as possible after
January 1 of each calendar year. Such obligations of the Trustee shall
be deemed to have been satisfied to the extent that substantially
comparable information shall be provided by the Trustee pursuant to any
requirements of the Code as from time to time in effect.
SECTION 2.2.1. SERIES 1997-1 EARLY AMORTIZATION EVENTS. If any one
of the following events shall occur with respect to the Investor Certificates:
2.2.1.1. failure on the part of the Seller or the Originator (i)
to make any payment or deposit required by the terms of (A) the
Agreement, (B) this Supplement or (C) the Purchase Agreement, on or
before the date occurring five days after the date such payment or
deposit is required to be made herein or (ii) duly to observe or
perform in any material respect any covenants or agreements of the
Seller set forth in the Agreement, this Supplement (including, without
limitation, the covenant of the Seller contained in Section 11 of this
Supplement) or the Purchase Agreement, which failure has a material
adverse effect on the Series 1997-1 Certificateholders (which
determination shall be made without reference to the amount of the
Class C Investor Interest or the Class D Investor Interest for such
period) and which continues unremedied for a period of 60 days after
the date on which written notice of such failure, requiring the same to
be remedied, shall have been given to the Seller by the Trustee, or to
the Seller and the Trustee by the Controlling Certificateholders, and
continues to affect materially and adversely the interests of the
Series 1997-1 Certificateholders for such period (which determination
shall be made without reference to the amount of the Class C Investor
Interest or the Class D Investor Interest for such period);
48
2.2.1.2. any representation or warranty made by the Seller or the
Originator in the Agreement, this Supplement or the Purchase Agreement,
or any information contained in a computer file or microfiche or
written list required to be delivered by the Seller pursuant to Section
2.1 or 2.6 or by the Originator pursuant to Section 1.1 or 2.4(e) of
the Purchase Agreement, (i) shall prove to have been incorrect in any
material respect when made or when delivered, which continues to be
incorrect in any material respect for a period of 60 days after the
date on which written notice of such failure, requiring the same to be
remedied, shall have been given to the Seller by the Trustee, or to the
Seller and the Trustee by the Controlling Certificateholders, and (ii)
as a result of which the interests of the Series 1997-1
Certificateholders are materially and adversely affected (which
determination shall be made without reference to the amount of the
Class C Investor Interest or the Class D Investor Interest) and
continue to be materially and adversely affected for such period;
provided, however, that a Series 1997-1 Early Amortization Event
pursuant to this subsection 9(b) shall not be deemed to have occurred
hereunder if the Seller has accepted reassignment of the related
Receivable, or all of such Receivables, if applicable, during such
period in accordance with the provisions of the Agreement;
2.2.1.3. the average Portfolio Yield for any three consecutive Due
Periods is reduced to a rate which is less than the average Base Rate
for such period;
2.2.1.4. the Seller shall fail to convey Receivables arising under
Additional Accounts to the Trust, as required by subsection 2.6(a);
2.2.1.5. any Servicer Default shall occur which would have a
material adverse effect on the Class A or Class B Certificateholders;
2.2.1.6. the Class A Investor Interest shall not be paid in full
on the Class A Expected Final Payment Date;
2.2.1.7. the failure on the part of an Interest Rate Cap Provider
to make a Class A Cap Payment or a Class B Cap Payment, as applicable,
in full within five calendar days of the date on which such Class A Cap
Payment or Class B Cap Payment was due;
2.2.1.8. the failure on the part of the Servicer (and the
applicable Interest Rate Cap Provider pursuant to its obligations under
the related Interest Rate Cap), within 30 calendar days of the
withdrawal or reduction below A-1 in the unsecured, unguaranteed,
short-term debt rating of an Interest Rate Cap Provider by Standard &
Poor's or a withdrawal of or reduction below P-1 in the unsecured,
unguaranteed, short-term debt rating of an Interest Rate Cap Provider
by Xxxxx'x to (i) obtain a Replacement Interest Rate Cap with a
replacement cap provider having terms substantially the same as the
replaced Interest Rate Cap or (ii) enter into any other arrangement
satisfactory to the applicable Rating Agency, such that the rating of
Class A Certificates or Class B Certificates by the applicable Rating
Agency will not be withdrawn or reduced; or
2.2.1.9. on any Determination Date, the sum of (x) the amount, if
any, distributed to the Investor Certificateholders pursuant to
subsection 4.21(f) plus (y) the
49
amount on deposit in the Series Excess Funding Account (after giving
effect to all withdrawals and deposits to be made on such date) plus
(2) the amount on deposit in the Excess Funding Account, to the extent,
but only to the extent, such amount is held therein to maintain the
Minimum Seller Interest with respect to Series 1997-1 exceeds 33-1/3%
of the Initial Investor Interest.
then, in the case of any event described in subparagraph (a), (b), (e), (g) or
(h) after the applicable grace period set forth in such subparagraphs, either
the Trustee or the Controlling Certificateholders by notice then given in
writing to the Seller and the Servicer (and to the Trustee if given by the
Certificateholders) may declare that an early amortization event (a "Series
1997-1 Early Amortization Event") has occurred as of the date of such notice,
and in the case of any event described in subparagraphs (c), (d), (f) or (i), a
Series 1997-1 Early Amortization Event shall occur without any notice or other
action on the part of the Trustee or the Investor Certificateholders immediately
upon the occurrence of such event.
SECTION 2.2.2. SERIES 1997-1 TERMINATION. The right of the
Investor Certificateholders to receive payments from the Trust will
terminate on the first Business Day following the Series 1997-1
Termination Date.
SECTION 2.2.3. LIMITATIONS ON ADDITION OF ACCOUNTS. The Seller
agrees that it shall not designate any Additional Accounts pursuant to
subsection 2.6(b) unless on or prior to the related Addition Date, the
Seller shall have provided the Class C Certificateholders with an
Officer's Certificate certifying that such designation of such
Additional Accounts will not, as of the related Addition Date, (x) be
reasonably expected by the Seller to result in a reduction or
withdrawal by either Rating Agency of its rating for the Series 1997-1
Certificates, (y) cause a Series 1997-1 Early Amortization Event, or
(z) be reasonably expected by the Seller to materially adversely affect
in any manner the timing or amount of payments to the Class C
Certificateholders.
SECTION 2.2.4. 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 2.2.5. COUNTERPARTS. This Supplement may be executed in
any number of counterparts, each of which so executed shall be deemed
to be an original, but all of such counterparts shall together
constitute but one and the same instrument.
SECTION 2.2.6. 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.
50
SECTION 2.2.7. NO PETITION.
2.2.7.1. The Seller, the Servicer and the Trustee, by entering
into this Supplement and each Investor Certificateholder, by accepting
an Investor Certificate, hereby covenant and agree that they will not
at any time institute against the Trust, or join in any institution
against the Trust of, any bankruptcy proceedings under any United
States Federal or state bankruptcy or similar law in connection with
any obligations relating to the Investor Certificates, the Agreement or
this Supplement.
2.2.7.2. The Servicer and the Trustee, by entering into this
Supplement and each Investor Certificateholder, by accepting a Series
Investor Certificate, hereby covenant and agree that they will not at
any time institute against the Seller, or join in any institution
against the Seller of, any bankruptcy proceedings under any United
States Federal or state bankruptcy or similar law in connection with
any obligations relating to the Investor Certificates, the Agreement or
this Supplement.
SECTION 2.2.8. TAX REPRESENTATION AND COVENANT. Notwithstanding
Section 6.3 of the Pooling and Servicing Agreement, Seller shall not
execute, and the Transfer Agent and Registrar shall not register the
transfer of, (i) any Class C Certificate, if after giving effect to the
execution or transfer of such Class Certificate, there would be more
than 10 Private Holders of Class C Certificates or (ii) any Class D
Certificate, if after giving effect to the execution or transfer of
such Class D Certificate, there would be more than 3 Private Holders of
Class D Certificates. For purposes of this Supplement and the Pooling
Agreement, each Holder of a Class C Certificate or a Class D
Certificate shall be a "Private Holder."
SECTION 2.2.9. CERTAIN TAX RELATED AMENDMENTS. In addition to any
other provisions relating to amendments in either the Agreement or this
Supplement, this Supplement may be amended by the Seller without the
consent of the Servicer, Trustee or any Investor Certificateholder if
the Seller provides the Trustee with (i) an Opinion of Counsel to the
effect that such amendment or modification would reduce the risk the
Trust would be treated as taxable as a publicly traded partnership
pursuant to Code section 7704 and (ii) a certificate that such
amendment or modification would not materially and adversely affect any
Investor Certificateholder; provided, however, that no such amendment
shall be deemed effective without the Trustee's consent, if the
Trustee's rights, duties and obligations hereunder are thereby
modified.
51
IN WITNESS WHEREOF, the Seller, the Servicer and the Trustee have
caused this Series 1997-1 Supplement to be duly executed by their respective
officers as of the day and year first above written.
CHARMING SHOPPES RECEIVABLES
CORP.,
Seller
By:
Name:
Title:
SPIRIT OF AMERICA NATIONAL BANK,
Servicer
By:
Name:
Title:
FIRST UNION NATIONAL BANK,
Trustee
By:
Name:
Title:
52
EXHIBIT A-1
FORM OF CLASS A CERTIFICATE
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 (THE "1933 ACT"). NEITHER THIS CERTIFICATE NOR ANY PORTION HEREOF MAY BE
OFFERED OR SOLD EXCEPT IN COMPLIANCE WITH THE REGISTRATION PROVISIONS OF THE
1933 ACT AND ANY APPLICABLE PROVISIONS OF ANY STATE BLUE SKY OR SECURITIES LAWS
OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION PROVISIONS. THE
TRANSFER OF THIS CERTIFICATE IS SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A BENEFIT
PLAN (AS DEFINED BELOW):
THIS CERTIFICATE 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 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.
Unless this Certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation ("DTC"), to Charming
Shoppes Receivables Corp. or its agent for registration of transfer, exchange or
payment, and any certificate issued is registered in the name of Cede & Co. or
in such other name as requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein.
53
No. __ $__________
CUSIP No. 1161137 AB0
CHARMING SHOPPES MASTER TRUST
FLOATING RATE ASSET BACKED CERTIFICATE, SERIES 1997-1, CLASS A
Each $1,000 minimum denomination represents
a 1/83,500th Undivided Interest in the
Charming Shoppes Master Trust Series 1997-1
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of credit card receivables acquired by Charming Shoppes Receivables
Corp. and other assets and interests constituting the Trust under the Pooling
and Servicing Agreement described below.
(Not an interest in or obligation of,
Charming Shoppes Receivables Corp., Spirit of America National Bank,
Charming Shoppes, Inc. or any Affiliate thereof.)
This certifies that CEDE & CO. (the "Class A Certificateholder")
is the registered owner of the Undivided Interest in a trust (the "Trust"), the
corpus of which consists of a portfolio of receivables (the "Receivables") now
existing or hereafter created under credit card accounts (the "Accounts") of
Spirit of America National Bank, a national banking association organized under
the laws of the United States, all monies due or to become due in payment of the
Receivables (including all Finance Charge Receivables), the benefits of the
subordination of the Class B Certificates, the Class C Certificates and Class D
Certificates and the other assets and interests constituting the Trust pursuant
to a Second Amended and Restated Pooling and Servicing Agreement dated as of
November 25, 1997 (the "Pooling and Servicing Agreement"), by and among Charming
Shoppes Receivables Corp., as Seller, Spirit of America National Bank, as
Servicer, and First Union National Bank, as Trustee (the "Trustee").
The Series 1997-1 Certificates are issued in four classes, the
Class A Certificates (of which this certificate is one), the Class B
Certificates, which are subordinated to the Class A Certificates in certain
rights of payment as described herein and in the Pooling and Servicing
Agreement, the Class C Certificates, which are subordinated to the Class A
Certificates and the Class B Certificates in certain rights of payment as
described herein and in the Pooling and Servicing Agreement, and the Class D
Certificates, which are subordinated to the Class A Certificates, the Class B
Certificates and the Class C Certificates in certain rights of payments as
described herein and in the Pooling and Servicing Agreement.
The Seller has structured the Pooling and Servicing Agreement and
the Class A Certificates with the intention that the Class A Certificates will
qualify under applicable tax law as indebtedness, and the Seller, the Holder of
the Exchangeable Seller Certificate, the Servicer and each Class A
Certificateholder (or Certificate Owner with respect to a Class A Certificate (a
"Class A Certificate Owner")) by acceptance of its Class A Certificate (or in
the case of a Class A Certificate Owner, by virtue of such Class A Certificate
Owner's acquisition of a beneficial interest therein), agrees to treat and to
take no action inconsistent with the treatment of
54
the Class A Certificates (or beneficial interest therein) for purposes of
federal, state, local and foreign income or franchise taxes and any other tax
imposed on or measured by income, as indebtedness. Each Class A
Certificateholder agrees that it will cause any Class A Certificate Owner
acquiring an interest in a Class A Certificate through it to comply with the
Pooling and Servicing Agreement as to treatment as indebtedness for certain tax
purposes.
To the extent not defined herein, capitalized terms used herein
have the meanings assigned in the Pooling and Servicing Agreement. This Class A
Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Class A Certificateholder
by virtue of the acceptance hereof assents and by which the Class A
Certificateholder is bound.
The Receivables consist of Principal Receivables which arise from
the purchase of goods and services and of Finance Charge Receivables which arise
generally from periodic rate finance charges and other fees and charges, as more
fully specified in the Pooling and Servicing Agreement. The Trust corpus
consists of the Receivables now existing in the Accounts or hereafter created in
the Accounts, all monies due or to become due with respect thereto (including
all Finance Charge Receivables), all proceeds of the Receivables and Recoveries
and Insurance Proceeds relating thereto, and such funds as from time to time are
deposited in the Collection Account. This Certificate is one of a series of
Certificates entitled "Charming Shoppes Master Trust, Floating Rate Asset Backed
Certificates, Series 1997-1, Class A" (the "Class A Certificates"), each of
which represents an Undivided Interest in the Trust, including the right to
receive the Collections and other amounts at the times and in the amounts
specified in the Pooling and Servicing Agreement to be deposited in the
Collection Account or paid to the Class A Certificate-holders. 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
Investor Interest at such time. "Class A Investor Interest" shall mean, on any
date of determination, an amount equal to (a) the Class A Initial Series
Investor Interest, minus (b) the aggregate amount of principal payments made to
Class A Certificateholders prior to such date and minus (c) the excess, if any,
of the aggregate amount of Class A Investor Charge-Offs over Class A Investor
Charge-Offs reimbursed prior to such date of determination; provided, however,
that the Class A Investor Interest may not be reduced below zero. The Class A
Initial Series Investor Interest is $56,000,000. In addition to the Series
1997-1 Certificates, an Exchangeable Seller Certificate will be reissued to the
Seller pursuant to the Pooling and Servicing Agreement, which will represent an
undivided interest in the Trust. The Exchangeable Seller Certificate will
represent the interest in the Principal Receivables not represented by all of
the Series of Investor Certificates issued by the Trust or Series of Receivables
Purchase Interests sold by the Trust. The Exchangeable Seller Certificate may be
exchanged by the Seller pursuant to the Pooling and Servicing Agreement for a
newly issued Series of Investor Certificates and a reissued Exchangeable Seller
Certificate upon the conditions set forth in the Pooling and Servicing
Agreement.
This Class A Certificate does not represent an obligation of, or
an interest in, the Seller or the Servicer, and neither the Class A Certificates
nor the Accounts or Receivables are insured or guaranteed by the Federal Deposit
Insurance Corporation or any other governmental
55
agency. This Class A Certificate is limited in right of payment to certain
collections respecting the Receivables, all as more specifically set forth in
the Pooling and Servicing Agreement.
The transfer of this Class A Certificate shall be 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 and the Transfer Agent and Registrar duly executed
by the Class A Certificateholder or such Class A Certificateholder's
attorney-in-fact duly authorized in writing, and thereupon one or more new Class
A Certificates of authorized denominations and for the same aggregate Undivided
Interests will be issued to the designated transferee or transferees.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, Class A Certificates are exchangeable for
new Class A Certificates evidencing like aggregate 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, the Trustee, the Paying Agent, the Transfer Agent and
Registrar, nor any agent of any of them or of any such agent shall be affected
by notice to the contrary except in certain circumstances described in the
Pooling and Servicing Agreement.
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 Pooling and Servicing Agreement,
or be valid for any purpose.
56
IN WITNESS WHEREOF, Charming Shoppes Receivables Corp. has caused this
Class A Certificate to be duly executed under its official seal.
CHARMING SHOPPES RECEIVABLES CORP.
By:
Authorized Officer
[Seal]
Attested to:
By:
Assistant Secretary
Date: _____ __, 1997
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
FIRST UNION NATIONAL BANK,
Trustee
By:
Authorized Officer
57
EXHIBIT A-2
FORM OF CLASS B CERTIFICATE
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 (THE "1933 ACT"). NEITHER THIS CERTIFICATE NOR ANY PORTION HEREOF MAY BE
OFFERED OR SOLD EXCEPT IN COMPLIANCE WITH THE REGISTRATION PROVISIONS OF THE
1933 ACT AND ANY APPLICABLE PROVISIONS OF ANY STATE BLUE SKY OR SECURITIES LAWS
OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION PROVISIONS. THE
TRANSFER OF THIS CERTIFICATE IS SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A BENEFIT
PLAN (AS DEFINED BELOW).
THIS CERTIFICATE 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 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.
Unless this Certificate is presented by an authorized representative of
The Depository Trust Company, a New York corporation ("DTC"), to Charming
Shoppes Receivables Corp. or its agent for registration of transfer, exchange or
payment, and any certificate issued is registered in the name of Cede & Co. or
in such other name as requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered
owner hereof, Cede & Co., has an interest herein.
58
No. __ $__________
CUSIP No.161137 AC8
CHARMING SHOPPES MASTER TRUST
FLOATING RATE ASSET BACKED CERTIFICATE, SERIES 1997-1, CLASS B
Each $1,000 minimum denomination represents
a 1/83,500th Undivided Interest in the
Charming Shoppes Master Trust Series 1997-1
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of credit card receivables acquired by Charming Shoppes Receivables
Corp. and other assets and interests constituting the Trust under the Pooling
and Servicing Agreement described below.
(Not an interest in or obligation of,
Charming Shoppes Receivables Corp., Spirit of America National Bank,
Charming Shoppes, Inc. or any Affiliate thereof.)
This certifies that CEDE & CO. (the "Class B Certificateholder")
is the registered owner of the Undivided Interest in a trust (the "Trust"), the
corpus of which consists of a portfolio of receivables (the "Receivables") now
existing or hereafter created under credit card accounts (the "Accounts") of
Spirit of America National Bank, a national banking association organized under
the laws of the United States, all monies due or to become due in payment of the
Receivables (including all Finance Charge Receivables), the benefits of the
subordination of the Class C Certificates and the Class D Certificate and the
other assets and interests constituting the Trust pursuant to a Second Amended
and Restated Pooling and Servicing Agreement dated as of November 25, 1997 (the
"Pooling and Servicing Agreement"), by and among Charming Shoppes Receivables
Corp., as Seller, Spirit of America National Bank, as Servicer, and First Union
National Bank, as Trustee (the "Trustee").
The Series 1997-1 Certificates are issued in four classes, the
Class A Certificates, the Class B Certificates (of which this certificate is
one), which are subordinated to the Class A Certificates in certain rights of
payment as described herein and in the Pooling and Servicing Agreement, the
Class C Certificates, which are subordinated to the Class A Certificates and the
Class B Certificates in certain rights of payment as described herein and in the
Pooling and Servicing Agreement, and the Class D Certificates, which are
subordinated to the Class A Certificates, the Class B Certificates and the Class
C Certificates in certain rights of payments as described herein and in the
Pooling and Servicing Agreement.
The Seller has structured the Pooling and Servicing Agreement and
the Class B Certificates with the intention that the Class B Certificates will
qualify under applicable tax law as indebtedness, and the Seller, the Holder of
the Exchangeable Seller Certificate, the Servicer and each Class B
Certificateholder (or Certificate Owner with respect to a Class B Certificate (a
"Class B Certificate Owner")) by acceptance of its Class B Certificate (or in
the case of a Class B Certificate Owner, by virtue of such Class B Certificate
Owner's acquisition of a beneficial interest therein), agrees to treat and to
take no action inconsistent with the treatment of the
59
Class B Certificates (or beneficial interest therein) for purposes of federal,
state, local and foreign income or franchise taxes and any other tax imposed on
or measured by income, as indebtedness. Each Class B Certificateholder agrees
that it will cause any Class B Certificate Owner acquiring an interest in a
Class B Certificate through it to comply with the Pooling and Servicing
Agreement as to treatment as indebtedness for certain tax purposes.
To the extent not defined herein, capitalized terms used herein
have the meanings assigned in the Pooling and Servicing Agreement. This Class B
Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Class B Certificateholder
by virtue of the acceptance hereof assents and by which the Class B
Certificateholder is bound.
The Receivables consist of Principal Receivables which arise from
the purchase of goods and services and of Finance Charge Receivables which arise
generally from periodic rate finance charges and other fees and charges, as more
fully specified in the Pooling and Servicing Agreement. The Trust corpus
consists of the Receivables now existing in the Accounts or hereafter created in
the Accounts, all monies due or to become due with respect thereto (including
all Finance Charge Receivables), all proceeds of the Receivables and Recoveries
and Insurance Proceeds relating thereto, and such funds as from time to time are
deposited in the Collection Account. This Certificate is one of a series of
Certificates entitled "Charming Shoppes Master Trust, Floating Rate Asset Backed
Certificates, Series 1997-1, Class B" (the "Class B Certificates"), each of
which represents an Undivided Interest in the Trust, including the right to
receive the Collections and other amounts at the times and in the amounts
specified in the Pooling and Servicing Agreement to be deposited in the
Collection Account or paid to the Class B Certificate-holders. 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
Investor Interest at such time. "Class B Investor Interest" shall mean, on any
date of determination, an amount equal to (a) the Class B Initial Investor
Interest, minus (b) the aggregate amount of principal payments made to Class B
Certificateholders prior to such date, minus (c) the aggregate amount of Class B
Investor Charge-Offs for all prior Distribution Dates minus (d) the aggregate
amount of Reallocated Class B Principal Collections allocated on all prior
Distribution Dates for which the Class C Investor Interest or the Class D
Investor Interest has not been reduced, minus (e) an amount equal to the amount
by which the Class B Investor Interest has been reduced on all prior
Distribution Dates pursuant to Section 4.10 of the Pooling and Servicing
Agreement and plus (f) the aggregate amount of Excess Spread and Shared Excess
Finance Charge Collections allocated and available on all prior Distribution
Dates for the purpose of reimbursing amounts deducted pursuant to the foregoing
clauses (c), (d) and (e); provided, however, that the Class B Investor Interest
may not be reduced below zero. The Class B Initial Series Investor Interest is
$8,500,000. In addition to the Series 1997-1 Certificates, an Exchangeable
Seller Certificate will be reissued to the Seller pursuant to the Pooling and
Servicing Agreement, which will represent an undivided interest in the Trust.
The Exchangeable Seller Certificate will represent the interest in the Principal
Receivables not represented by all of the Series of Investor Certificates issued
by the Trust or Series of Receivables Purchase Interests sold by the Trust. The
Exchangeable Seller Certificate may be exchanged by the Seller pursuant to the
Pooling and Servicing Agreement for a newly issued
60
Series of Investor Certificates and a reissued Exchangeable Seller Certificate
upon the conditions set forth in the Pooling and Servicing Agreement.
This Class B Certificate does not represent an obligation of, or
an interest in, the Seller or the Servicer, and neither the Class B Certificates
nor the Accounts or Receivables are insured or guaranteed by the Federal Deposit
Insurance Corporation or any other governmental agency. This Class B Certificate
is limited in right of payment to certain collections respecting the
Receivables, all as more specifically set forth in the Pooling and Servicing
Agreement.
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 in a form
satisfactory to the Trustee and the Transfer Agent and Registrar duly executed
by the Class B Certificateholder or such Class B Certificateholder's
attorney-in-fact duly authorized in writing, and thereupon one or more new Class
B Certificates of authorized denominations and for the same aggregate Undivided
Interests will be issued to the designated transferee or transferees.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, Class B Certificates are exchangeable for
new Class B Certificates evidencing like aggregate 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, the Trustee, the Paying Agent, the Transfer Agent and
Registrar, nor any agent of any of them or of any such agent shall be affected
by notice to the contrary except in certain circumstances described in the
Pooling and Servicing Agreement.
61
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 Pooling and Servicing Agreement,
or be valid for any purpose.
IN WITNESS WHEREOF, Charming Shoppes Receivables Corp. has caused
this Class B Certificate to be duly executed under its official seal.
CHARMING SHOPPES RECEIVABLES CORP.
By:
Authorized Officer
[Seal]
Attested to:
By:
Assistant Secretary
Date: _______ __, 1997
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
FIRST UNION NATIONAL BANK,
Trustee
By:
Authorized Officer
62
EXHIBIT A-3
FORM OF CLASS C CERTIFICATE
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933 (THE "1933 ACT"). NEITHER THIS CERTIFICATE NOR ANY PORTION HEREOF MAY BE
OFFERED OR SOLD EXCEPT IN COMPLIANCE WITH THE REGISTRATION PROVISIONS OF THE
1933 ACT AND ANY APPLICABLE PROVISIONS OF ANY STATE BLUE SKY OR SECURITIES LAWS
OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION PROVISIONS. THE
TRANSFER OF THIS CERTIFICATE IS SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A BENEFIT
PLAN (AS DEFINED BELOW).
THIS CERTIFICATE 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 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.
NEITHER THIS CERTIFICATE, NOR ANY PORTION OF THIS CERTIFICATE, MAY BE
TRANSFERRED (X) IF AFTER GIVING EFFECT TO THE EXECUTION OR TRANSFER OF SUCH
CERTIFICATE, THERE WOULD BE MORE THAN (I) 10 PRIVATE HOLDERS OF CLASS C
CERTIFICATES OR (II) 100 PRIVATE HOLDERS, OR (Y) ON OR THROUGH (I) AN
"ESTABLISHED SECURITIES MARKET" WITHIN THE MEANING OF SECTION 7704(b)(1) OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED, AND ANY PROPOSED, TEMPORARY OR FINAL
TREASURY REGULATION THEREUNDER, INCLUDING, WITHOUT LIMITATION, AN
OVER-THE-COUNTER-MARKET OR AN INTERDEALER QUOTATIONS SYSTEM THAT REGULARLY
DISSEMINATES FIRM BUY OR SELL QUOTATIONS OR (II) "SECONDARY MARKET" OR
"SUBSTANTIAL EQUIVALENT THEREOF" WITHIN THE MEANING OF SECTION 7704(b)(1) OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED, AND ANY PROPOSED, TEMPORARY OR FINAL
TREASURY REGULATIONS THEREUNDER, INCLUDING A MARKET WHEREIN INTERESTS IN THE
TRUST ARE REGULARLY QUOTED BY ANY PERSON MAKING A MARKET IN SUCH
63
INTERESTS AND A MARKET WHEREIN ANY PERSON REGULARLY MAKES AVAILABLE BID OR OFFER
QUOTES WITH RESPECT TO INTERESTS IN THE TRUST AND STANDS READY TO EFFECT BUY OR
SELL TRANSACTIONS AT THE QUOTED PRICES FOR ITSELF OR ON BEHALF OF OTHERS. ANY
ATTEMPTED TRANSFER, ASSIGNMENT, CONVEYANCE, PARTICIPATION OR SUBDIVISION IN
CONTRAVENTION OF THE PRECEDING RESTRICTIONS, AS REASONABLY DETERMINED BY THE
SELLER, SHALL BE VOID AB INITIO AND THE PURPORTED TRANSFEROR, SELLER OR
SUBDIVIDER OF SUCH CERTIFICATE SHALL BE CONSTRUED TO BE TREATED AS THE
CERTIFICATEHOLDER OF ANY SUCH CERTIFICATE FOR ALL PURPOSES OF THE POOLING AND
SERVICING AGREEMENT (DEFINED BELOW).
CUSIP No.161137 AD6
CHARMING SHOPPES MASTER TRUST
FLOATING RATE ASSET BACKED CERTIFICATE, SERIES 1997-1, CLASS C
Each $1,000 minimum denomination represents
a 1/83,500th Undivided Interest in the
Charming Shoppes Master Trust Series 1997-1
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of credit card receivables acquired by Charming Shoppes Receivables
Corp. and other assets and interests constituting the Trust under the Pooling
and Servicing Agreement described below.
(Not an interest in or obligation of,
Charming Shoppes Receivables Corp., Spirit of America National Bank, Charming
Shoppes, Inc. or any Affiliate thereof.)
This certifies that ______________ (the "Class C
Certificateholder") is the registered owner of the Undivided Interest in a trust
(the "Trust"), the corpus of which consists of a portfolio of receivables (the
"Receivables") now existing or hereafter created under credit card accounts (the
"Accounts") of Spirit of America National Bank, a national banking association
organized under the laws of the United States, all monies due or to become due
in payment of the Receivables (including all Finance Charge Receivables), the
subordination of the Class D Certificate and the other assets and interests
constituting the Trust pursuant to a Second Amended and Restated Pooling and
Servicing Agreement dated as of November 25, 1997 (the "Pooling and Servicing
Agreement"), by and among Charming Shoppes Receivables Corp., as Seller, Spirit
of America National Bank, as Servicer, and First Union National Bank, as Trustee
(the "Trustee").
The Series 1997-1 Certificates are issued in four classes, the
Class A Certificates, the Class B Certificates, which are subordinated to the
Class A Certificates in certain rights of payment as described herein and in the
Pooling and Servicing Agreement, the Class C Certificates (of which this
certificate is one), which are subordinated to the Class A Certificates and the
Class B Certificates in certain rights of payment as described herein and in the
Pooling
64
and Servicing Agreement, and the Class D Certificates, which are subordinated to
the Class A Certificates, the Class B Certificates and the Class C Certificates
in certain rights of payments as described herein and in the Pooling and
Servicing Agreement.
To the extent not defined herein, capitalized terms used herein
have the meanings assigned in the Pooling and Servicing Agreement. This Class C
Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Class C Certificateholder
by virtue of the acceptance hereof assents and by which the Class C
Certificateholder is bound.
The Receivables consist of Principal Receivables which arise from
the purchase of goods and services and of Finance Charge Receivables which arise
generally from periodic rate finance charges and other fees and charges, as more
fully specified in the Pooling and Servicing Agreement. The Trust corpus
consists of the Receivables now existing in the Accounts or hereafter created in
the Accounts, all monies due or to become due with respect thereto (including
all Finance Charge Receivables), all proceeds of the Receivables and Recoveries
and Insurance Proceeds relating thereto, and such funds as from time to time are
deposited in the Collection Account. This Certificate is one of a series of
Certificates entitled "Charming Shoppes Master Trust, Floating Rate Asset Backed
Certificates, Series 1997-1, Class C" (the "Class C Certificates"), each of
which represents an Undivided Interest in the Trust, including the right to
receive the Collections and other amounts at the times and in the amounts
specified in the Pooling and Servicing Agreement to be deposited in the
Collection Account or paid to the Class C Certificateholders. The aggregate
interest represented by the Class C Certificates at any time in the Principal
Receivables in the Trust shall not exceed an amount equal to the Class C
Investor Interest at such time. "Class C Investor Interest" shall mean, on any
date of determination, an amount equal to (a) the Class C Initial Investor
Interest, minus (b) the aggregate amount of principal payments made to Class C
Certificateholders prior to such date, minus (c) the aggregate amount of Class C
Investor Charge-Offs for all prior Distribution Dates minus (d) the aggregate
amount of Reallocated Class C Principal Collections allocated on all prior
Distribution Dates for which the Class D Investor Interest has not been reduced,
minus (e) an amount equal to the amount by which the Class C Investor Interest
has been reduced on all prior Distribution Dates pursuant to Section 4.10 of the
Pooling and Servicing Agreement and plus (f) the aggregate amount of Excess
Spread and Shared Excess Finance Charge Collections allocated and available on
all prior Distribution Dates for the purpose of reimbursing amounts deducted
pursuant to the foregoing clauses (c), (d) and (e); provided, however, that the
Class C Investor Interest may not be reduced below zero. The Class C Initial
Series Investor Interest is $9,500,000. In addition to the Series 1997-1
Certificates, an Exchangeable Seller Certificate will be reissued to the Seller
pursuant to the Pooling and Servicing Agreement, which will represent an
undivided interest in the Trust. The Exchangeable Seller Certificate will
represent the interest in the Principal Receivables not represented by all of
the Series of Investor Certificates issued by the Trust or Series of Receivables
Purchase Interests sold by the Trust. The Exchangeable Seller Certificate may be
exchanged by the Seller pursuant to the Pooling and Servicing Agreement for a
newly issued Series of Investor Certificates and a reissued Exchangeable Seller
Certificate upon the conditions set forth in the Pooling and Servicing
Agreement.
65
This Class C Certificate does not represent an obligation of, or
an interest in, the Seller or the Servicer, and neither the Class C Certificates
nor the Accounts or Receivables are insured or guaranteed by the Federal Deposit
Insurance Corporation or any other governmental agency. This Class C Certificate
is limited in right of payment to certain collections respecting the
Receivables, all as more specifically set forth in the Pooling and Servicing
Agreement.
The transfer of this Class C Certificate shall be registered in
the Certificate Register upon surrender of this Class C 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 and the Transfer Agent and Registrar duly executed
by the Class C Certificateholder or such Class C Certificateholder's
attorney-in-fact duly authorized in writing, and thereupon one or more new Class
C Certificates of authorized denominations and for the same aggregate Undivided
Interests will be issued to the designated transferee or transferees.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth and in the Class C Purchase Agreement,
Class C Certificates are exchangeable for new Class C Certificates evidencing
like aggregate Undivided Interests, as requested by the Class C
Certificateholder surrendering such Class C 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 C Certificate is registered as the owner hereof for all purposes, and
neither the Servicer, the Trustee, the Paying Agent, the Transfer Agent and
Registrar, nor any agent of any of them or of any such agent shall be affected
by notice to the contrary except in certain circumstances described in the
Pooling and Servicing Agreement.
Unless the certificate of authentication hereon has been executed
by or on behalf of the Trustee, by manual signature, this Class C Certificate
shall not be entitled to any benefit under the Pooling and Servicing Agreement,
or be valid for any purpose.
IN WITNESS WHEREOF, Charming Shoppes Receivables Corp. has caused
this Class C Certificate to be duly executed under its official seal.
CHARMING SHOPPES RECEIVABLES CORP.
By:
Authorized Officer
[Seal]
66
Attested to:
By:
Assistant Secretary
Date: _______ __, 1997
CERTIFICATE OF AUTHENTICATION
This is one of the Class C Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
FIRST UNION NATIONAL BANK,
Trustee
By:
Authorized Officer
67
EXHIBIT A-4
FORM OF CLASS D CERTIFICATE
No. __ $__________
CHARMING SHOPPES MASTER TRUST
FLOATING RATE ASSET BACKED CERTIFICATE, SERIES 1997-1,
CLASS D CERTIFICATE
THIS CERTIFICATE WAS ISSUED PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
"ACT"), AND MAY BE SOLD ONLY PURSUANT TO A REGISTRATION
STATEMENT EFFECTIVE UNDER THE ACT OR AN EXEMPTION FROM THE
PROVISIONS OF SECTION 5 OF THE ACT. IN ADDITION, THE TRANSFER
OF THIS CERTIFICATE IS SUBJECT TO RESTRICTIONS SET FORTH IN
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. A COPY
OF THE POOLING AND SERVICING AGREEMENT WILL BE FURNISHED TO
THE HOLDER OF THIS CERTIFICATE BY THE TRUSTEE UPON WRITTEN
REQUEST.
THIS CERTIFICATE 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 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.
NEITHER THIS CERTIFICATE, NOR ANY PORTION OF THIS CERTIFICATE, MAY BE
TRANSFERRED (X) IF AFTER GIVING EFFECT TO THE EXECUTOR OR TRANSFER OF
SUCH CERTIFICATE, THERE WOULD BE MORE THAN (I) 3 PRIVATE HOLDERS OF
CLASS D CERTIFICATES OR (II) 100 PRIVATE HOLDERS, OR (Y) ON OR THROUGH
(I) AN "ESTABLISHED SECURITIES MARKET" WITHIN THE MEANING OF SECTION
7704(b)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED, AND ANY
PROPOSED, TEMPORARY OR FINAL TREASURY REGULATION THEREUNDER, INCLUDING,
WITHOUT LIMITATION, AN OVER-THE-COUNTER-MARKET OR AN INTERDEALER
QUOTATIONS SYSTEM THAT REGULARLY DISSEMINATES FIRM BUY OR
68
SELL QUOTATIONS OR (II) "SECONDARY MARKET" OR "SUBSTANTIAL EQUIVALENT
THEREOF" WITHIN THE MEANING OF SECTION 7704(b)(1) OF THE INTERNAL
REVENUE CODE OF 1986, AS AMENDED, AND ANY PROPOSED, TEMPORARY OR FINAL
TREASURY REGULATION THEREUNDER, INCLUDING A MARKET WHEREIN INTERESTS IN
THE TRUST ARE REGULARLY QUOTED BY ANY PERSON MAKING A MARKET IN SUCH
INTERESTS AND A MARKET WHEREIN ANY PERSON REGULARLY MAKES AVAILABLE BID
OR OFFER QUOTES WITH RESPECT TO INTEREST IN THE TRUST AND STANDS READY
TO EFFECT BUY OR SELL TRANSACTIONS AT THE QUOTED PRICES FOR ITSELF OR
ON BEHALF OF OTHERS. ANY ATTEMPTED TRANSFER, ASSIGNMENT, CONVEYANCE,
PARTICIPATION OR SUBDIVISION IN CONTRAVENTION OF THE PRECEDING
RESTRICTIONS, AS REASONABLY DETERMINED BY THE SELLER, SHALL BE VOID AB
INITIO AND THE PURPORTED TRANSFEROR, SELLER, OR SUBDIVIDER OF SUCH
CERTIFICATE SHALL BE CONSTRUED TO BE TREATED AS THE CERTIFICATEHOLDER
OF ANY SUCH CERTIFICATE FOR ALL PURPOSES OF THE POOLING AND SERVICING
AGREEMENT (DEFINED BELOW).
Each $1,000 minimum denomination represents
a 1/83,500th Undivided Interest in the
Charming Shoppes Master Trust Series 1997-1
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of credit card receivables acquired by Charming Shoppes Receivables
Corp. and other assets and interests constituting the Trust under the Pooling
and Servicing Agreement described below.
(Not an interest in or obligation of,
Charming Shoppes Receivables Corp., Spirit of America National Bank,
Charming Shoppes, Inc. or any Affiliate thereof.)
This certifies that ____________ (the "Class D Certificateholder")
is the registered owner of the Undivided Interest in a trust (the "Trust"), the
corpus of which consists of a portfolio of credit card receivables (the
"Receivables") now existing or hereafter created under credit card accounts (the
"Accounts") of Spirit of America National Bank, a national banking association
organized under the laws of the United States, all monies due or to become due
in payment of the Receivables (including all Finance Charge Receivables), and
the other assets and interests constituting the Trust pursuant to a Second
Amended and Restated Pooling and Servicing Agreement dated as of November 25,
1997 (the "Pooling and Servicing Agreement"), by and among Charming Shoppes
Receivables Corp., as Seller, Spirit of America National Bank, as Servicer, and
First Union National Bank, as Trustee (the "Trustee").
The Series 1997-1 Certificates are issued in four classes, the
Class A Certificates, the Class B Certificates, which are subordinated to the
Class A Certificates in certain rights of payment as described herein and in the
Pooling and Servicing Agreement, the Class C Certificates, which are
subordinated to the Class A Certificates and the Class B Certificates in certain
rights of payment as described herein, and in the Pooling and Servicing
Agreement, and
69
the Class D Certificates (of which this certificate is one), which are
subordinated to the Class A Certificates, the Class B Certificates and the Class
C Certificates in certain rights of payments as described herein, and in the
Pooling and Servicing Agreement.
To the extent not defined herein, capitalized terms used herein
have the meanings assigned in the Pooling and Servicing Agreement. This Class D
Certificate is issued under and is subject to the terms, provisions and
conditions of the Pooling and Servicing Agreement, to which Pooling and
Servicing Agreement, as amended from time to time, the Class D Certificateholder
by virtue of the acceptance hereof assents and by which the Class D
Certificateholder is bound.
The Receivables consist of Principal Receivables which arise from
the purchase of goods and services and of Finance Charge Receivables which arise
generally from periodic rate finance charges and other fees and charges, as more
fully specified in the Pooling and Servicing Agreement. The Trust corpus
consists of the Receivables now existing in the Accounts or hereafter created in
the Accounts, all monies due or to become due with respect thereto (including
all Finance Charge Receivables), all proceeds of the Receivables and Recoveries
and Insurance Proceeds relating thereto, and such funds as from time to time are
deposited in the Collection Account. This Certificate is one of a series of
Certificates entitled "Charming Shoppes Master Trust, Floating Rate Asset Backed
Certificates, Series 1997-1, Class D Certificates" (the "Class D Certificates"),
each of which represents an Undivided Interest in the Trust, including the right
to receive the Collections and other amounts at the times and in the amounts
specified in the Pooling and Servicing Agreement to be deposited in the
Collection Account or paid to the Class D Certificateholders. The aggregate
interest represented by the Class D Certificates at any time in the Principal
Receivables in the Trust shall not exceed an amount equal to the Class D
Investor Interest at such time. "Class D Investor Interest" shall mean, on any
date of determination, an amount equal to (a) the Class D Series Initial
Interest, minus (b) the aggregate amount of principal payments made to the
holders of the Class D Certificates prior to such date, minus (c) the aggregate
amount of Class D Charge-Offs for all prior Distribution Dates, minus (d) the
aggregate amount of Reallocated Class D Principal Collections allocated, (b) and
(c) on all prior Distribution Dates, minus (e) an amount equal to the amount by
which the Class D Investor Interest has been reduced on all prior Distribution
Dates pursuant to Section 4.10 of the Pooling and Servicing Agreement, and plus
(f) the aggregate amount of Excess Spread and Shared Excess Finance Charge
Collections allocated and available on all prior Distribution Dates for the
purpose of reimbursing amounts deducted pursuant to the foregoing clauses (c),
(d) and (e); provided further, however, that the Class D Interest may not be
reduced below zero. The Class D Initial Investor Interest is $9,500,000. In
addition to the Series 1997-1 Certificates, an Exchangeable Seller Certificate
will be reissued to the Seller pursuant to the Pooling and Servicing Agreement,
which will represent an undivided interest in the Trust. The Exchangeable Seller
Certificate will represent the interest in the Principal Receivables not
represented by all of the Series of Investor Certificates issued by the Trust or
Series of Receivables Purchase Interests sold by the Trust. The Exchangeable
Seller Certificate may be exchanged by the Seller pursuant to the Pooling and
Servicing Agreement for a newly issued Series of Investor Certificates and a
reissued Exchangeable Seller Certificate upon the conditions set forth in the
Pooling and Servicing Agreement.
This Class D Certificate does not represent an obligation of, or
an interest in, the Seller or the Servicer, and neither the Class D Certificates
nor the Accounts or Receivables are
70
insured or guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency. This Class D Certificate is limited in right of payment to
certain collections respecting the Receivables, all as more specifically set
forth in the Pooling and Servicing Agreement.
The transfer of this Class D Certificate shall be registered in
the Certificate Register upon surrender of this Class D 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 and the Transfer Agent and Registrar duly executed
by the Class D Certificateholder or such Class D Certificateholder's
attorney-in-fact duly authorized in writing, and thereupon one or more new Class
D Certificates of authorized denominations and for the same aggregate Undivided
Interests will be issued to the designated transferee or transferees.
As provided in the Pooling and Servicing Agreement and subject to
certain limitations therein set forth, Class D Certificates are exchangeable for
new Class D Certificates evidencing like aggregate Undivided Interests, as
requested by the Class D Certificateholder surrendering such Class D
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 D Certificate is registered as the owner hereof for all purposes, and
neither the Servicer, the Trustee, the Paying Agent, the Transfer Agent and
Registrar, nor any agent of any of them or of any such agent shall be affected
by notice to the contrary except in certain circumstances described in the
Pooling and Servicing Agreement.
71
Unless the certificate of authentication hereon has been executed
by or on behalf of the Trustee, by manual signature, this Class D Certificate
shall not be entitled to any benefit under the Pooling and Servicing Agreement,
or be valid for any purpose.
IN WITNESS WHEREOF, Charming Shoppes Receivables Corp. has caused
this Class D Certificate to be duly executed under its official seal.
CHARMING SHOPPES RECEIVABLES CORP.
By:
Authorized Officer
[Seal]
Attested to:
By:
Assistant Secretary
Date: _______ __, 1997
CERTIFICATE OF AUTHENTICATION
This is one of the Class D Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
FIRST UNION NATIONAL BANK,
Trustee
By:
Authorized Officer
72
EXHIBIT B
FORM OF MONTHLY PAYMENT INSTRUCTIONS AND
NOTIFICATION TO THE TRUSTEE
SPIRIT OF AMERICA NATIONAL BANK
CHARMING SHOPPES MASTER TRUST
SERIES 1997-1
The undersigned, a duly authorized representative of Spirit of America
National Bank ("Spirit"), as Servicer pursuant to the Second Amended and
Restated Pooling and Servicing Agreement dated as of November 25, 1997 (the
"Pooling and Servicing Agreement") by and among Charming Shoppes Receivables
Corp., as Seller, Spirit and First Union National Bank, as trustee (the
"Trustee"), does hereby certify as follows:
2.2.9.0.0.1. Capitalized terms used in this notice have their
respective meanings set forth in the Pooling and Servicing Agreement;
provided, that the "preceding Due Period" shall mean the Due Period
immediately preceding the calendar month in which this notice is
delivered. References herein to certain sections and subsections are
references to the respective sections and subsections of the Pooling
and Servicing Agreement. This notice is delivered pursuant to Section
4.9 of the Pooling and Servicing Agreement.
2.2.9.0.0.2. Spirit is the Servicer under the Pooling and
Servicing Agreement.
2.2.9.0.0.3. The undersigned is a Servicing Officer.
2.2.9.0.0.4. The date of this notice is a Determination Date
under the Pooling and Servicing Agreement.
3. INSTRUCTION TO MAKE A WITHDRAWAL
The Servicer does hereby instruct the Trustee (i) to make withdrawals
from the Collection Account, the Principal Funding Account and the Series Excess
Funding Reserve Account on ______________ __, _____, which date is a
Distribution Date under the Pooling and Servicing Agreement, in aggregate
amounts set forth below in respect of the following amounts and (ii) to
73
apply the proceeds of such withdrawals in accordance with Section 3 of the
Series 1997-1 Supplement, as applicable and Section 4.9 of the Pooling and
Servicing Agreement, as applicable:
3.0.0.0.0.1. Pursuant to subsection 4.9(a)(i):
3.0.0.0.0.1.1. Class A Monthly Interest at
the Class A Certificate Rate
on the Class A Investor Interest $
--------
3.0.0.0.0.1.2. Class A Deficiency Amount $
--------
3.0.0.0.0.1.3. Class A Additional Interest $
--------
3.0.0.0.0.2. Pursuant to subsection 4.9(a)(ii):
3.0.0.0.0.2.1. Class A Servicing Fee $
--------
3.0.0.0.0.2.2. Accrued and unpaid Class A
Servicing Fee $
--------
3.0.0.0.0.3. Pursuant to subsection 4.9(a)(iii):
3.0.0.0.0.3.1. Class A Investor Loss Amount $
--------
3.0.0.0.0.4. Pursuant to subsection 4.9(a)(iv):
3.0.0.0.0.4.1. Portion of Excess Spread from
Class A Available Funds to be
allocated and distributed as
provided in Section 4.11 $
--------
3.0.0.0.0.5. Pursuant to subsection 4.9(b)(i):
3.0.0.0.0.5.1. Class B Monthly Interest at the
Class B Certificate Rate on the
Class B Investor Interest $
--------
3.0.0.0.0.5.2. Class B Deficiency Amount $
--------
3.0.0.0.0.5.3. Class B Additional Interest $
--------
74
3.0.0.0.0.6. Pursuant to subsection 4.9(b)(ii):
3.0.0.0.0.6.1. Class B Servicing Fee $
--------
3.0.0.0.0.6.2. Accrued and unpaid Class B
Servicing Fee $
--------
3.0.0.0.0.7. Pursuant to subsection 4.9(b)(iii):
3.0.0.0.0.7.1. Class B Investor Loss Amount $
--------
3.0.0.0.0.8. Pursuant to subsection 4.9(b)(iv):
3.0.0.0.0.8.1. Portion of Excess Spread from
Class B Available Funds to be
allocated and distributed as
provided in Section 4.11 $
--------
3.0.0.0.0.9. Pursuant to subsection 4.9(c)(i):
3.0.0.0.0.9.1. Class C Servicing
Fee $
--------
3.0.0.0.0.9.2. Accrued and unpaid Class C
Servicing Fee, if applicable $
--------
3.0.0.0.0.10. Pursuant to subsection 4.9(c)(ii):
3.0.0.0.0.10.1. Portion of Excess Spread from
Class C Available Funds to
be allocated and distributed as
provided in Section 4.11 $
--------
3.0.0.0.0.11. Pursuant to subsection 4.9(d)(i):
3.0.0.0.0.11.1. Class D Servicing Fee
3.0.0.0.0.11.2. Accrued and unpaid Class D
Servicing Fee, if applicable $
--------
75
3.0.0.0.0.12. Pursuant to subsection 4.9(d)(ii):
3.0.0.0.0.12.1. Portion of Excess Spread from
Class D Available Funds to be
allocated and distributed as
provided in Section 4.11 $
--------
Total $
========
3.0.0.0.0.13. Pursuant to subsection 4.9(e)(i):
3.0.0.0.0.13.1. Amount to be applied pursuant
to Class C Purchase Agreement $
--------
3.0.0.0.0.14. Pursuant to subsection 4.9(e)(ii):
3.0.0.0.0.14.1. Amount to be treated as Shared
Excess Principal Collections $
--------
3.0.0.0.0.15. Pursuant to subsection 4.9(e)(iii):
3.0.0.0.0.15.1. Amount to be paid to the Holder
of the Exchangeable Seller's
Certificate $
--------
3.0.0.0.0.16. Pursuant to subsection 4.9(f)(i):
3.0.0.0.0.16.1. Class A Monthly Principal $
--------
3.0.0.0.0.17. Pursuant to subsection 4.9(f)(ii):
3.0.0.0.0.17.1. Class B Monthly Principal $
--------
3.0.0.0.0.18. Pursuant to subsection 4.9(f)(iii):
3.0.0.0.0.18.1. Class C Monthly Principal to be
applied in accordance with the
Class C Purchase Agreement $
--------
3.0.0.0.0.19. Pursuant to subsection 4.9(f)(iv):
3.0.0.0.0.19.1. Class D Monthly Principal $
--------
76
3.0.0.0.0.20. Pursuant to subsection 4.9(f)(v):
3.0.0.0.0.20.1. Amount to be applied pursuant
to Class C Purchase Agreement $
--------
3.0.0.0.0.21. Pursuant to subsection 4.9(f)(vi):
3.0.0.0.0.21.1. Amount to be treated as Shared
Excess Principal Collections $
--------
3.0.0.0.0.22. Pursuant to subsection 4.9(f)(vii):
3.0.0.0.0.22.1. Amount to be paid to the Holder
of the Exchangeable Seller's
Certificate $
--------
Total $
========
3.0.0.0.0.23. Pursuant to subsection 4.9(g):
3.0.0.0.0.23.1. Amount to be withdrawn from
the Principal Funding Account
and deposited into the
Distribution Account $
--------
3.0.0.0.0.24. Pursuant to Section 4.14:
3.0.0.0.0.24.1. Amount of Shared Excess Finance
Charge Collections to be withdrawn
from the Collection Account to be
allocated to Series 1997-1 and
distributed as provided in
Section 4.11. $
--------
3.0.0.0.0.25. Pursuant to Section 4.17(c):
3.0.0.0.0.25.1. Principal Funding Investment
Proceeds $
--------
3.0.0.0.0.26. Pursuant to Section 4.21(b):
3.0.0.0.0.26.1. Amount of investment income
earned on Series Excess Funding Account $
--------
77
3.0.0.0.0.27. Pursuant to Section 4.21(d):
3.0.0.0.0.28. Pursuant to Section 4.21(e):
3.0.0.0.0.28.1. Amount treated as Shared
Principal Collections $
--------
3.0.0.0.0.28.2. Amount to be paid to Holder of
Exchangeable Seller Certificate $
--------
3.0.0.0.0.29. Pursuant to Section 4.21(f):
3.0.0.0.0.29.1. Amount to be distributed as
principal to holders of Investor
Certificates $
--------
(a) amount distributable to
Class A Certificateholders $
--------
(b) amount distributable to
Class B Certificateholders $
--------
(c) amount distributable to
Class C Certificateholders $
--------
(d) amount distributable to
Class D Certificateholders $
--------
3.0.0.0.0.29.2. Amount of Principal Shortfalls $
--------
3.0.0.0.0.30. Pursuant to Section 4.22(b):
3.0.0.0.0.30.1. Amount of investment income
earned on Series Excess Funding
Reserve Account in excess of
Series Excess Funding Reserve
Account Required Amount $
--------
3.0.0.0.0.31. Pursuant to Section 4.22(d):
3.0.0.0.0.31.1. Series Excess Funding
Reserve Draw Amount $
--------
3.0.0.0.0.32. Pursuant to Section 4.22(e):
3.0.0.0.0.32.1. Series Excess Funding
Reserve Account Surplus $
--------
78
4. INSTRUCTION TO MAKE CERTAIN PAYMENTS
Pursuant to Section 4.9 of the Pooling and Servicing Agreement, the
Servicer does hereby instruct the Trustee to pay in accordance with Section 5.1
from the Collection Account on __________ __, ____, which date is a Distribution
Date under the Pooling and Servicing Agreement:
4.0.1. AMOUNT TO BE DISTRIBUTED TO
Class A Certificateholders $
4.0.2. AMOUNT TO BE DISTRIBUTED TO
Class B Certificateholders $
4.0.3. AMOUNT TO BE DISTRIBUTED TO THE
Class D Certificateholders $
5. APPLICATION OF EXCESS SPREAD
Pursuant to Section 4.11, the Servicer does hereby instruct the Trustee
to apply the Excess Spread with respect to the related Due Period and to make
the following distributions in the following priority:
A. The amount equal to the Class A
Required Amount, if any, which will
be used to fund the Class A Required
Amount and be applied in accordance
with, and in the priority set forth
in subsection 4.9(a) $
B. The amount equal to the aggregate
amount of Class A Investor
Charge-Offs which have not been
previously reimbursed (after giving
effect to the allocation on such
Distribution Date of certain other
amounts applied for that purpose)
which will be treated as a portion
of Investor Principal Collections $
C. The amount equal to the Class B
Required Amount, if any, which
79
will be used to fund the Class B
Required Amount and be applied first
in accordance with, and in the priority
set forth in, subsection 4.9(b) $
D. The amount equal to the aggregate
amount by which the Class B Investor
Interest has been reduced below the
initial Class B Series Investor
Interest for reasons other than the
payment of principal to the Class B
Certificateholders (but not in
excess of the aggregate amount of
such reductions which have not been
previously reimbursed) which will be
treated as a portion of Available
Principal Collection $
E. The amount equal to the aggregate
amount of accrued but unpaid Class C
Servicing Fee (after giving affect
to the application of Class C
Available Funds thereto pursuant to
Section 4.9) $
F. The amount equal to the Class C
Monthly Interest plus the amount of
any past due Class C Monthly
Interest which will be paid to the
Class C Holder for application in
accordance with the Class C Purchase
Agreement $
G. The amount equal to the Class C
Investor Loss Amount, if any, for
the prior Due Period which will be
treated as a portion of Available
Principal Collections $
H. The amount equal to the aggregate
amount by which the Class C Investor
Interest has been reduced
80
below the initial Class C Investor
Interest for reasons other than the
payment of principal to the Class C
Investor Holder (but not in excess
of the aggregate amount of such
reductions which have not been
previously reimbursed) which will be
treated as a portion of Available
Principal Collections $
I. The amount up to the excess, if any,
of the Series Excess Funding Account
Required Amount over the amount on
deposit in the Series Excess Funding
Reserve Account which shall be
deposited into the Series Excess
Funding Reserve Account $
J. The amount equal to the aggregate
amount of any other amounts then due
to the Class C Certificateholders
out of Excess Spread and Shared
Excess Finance Charge Collections
allocated to Series 1997-1 pursuant
to the Class C Purchase Agreement to
be distributed to the Class C
Certificateholders for application
in accordance with the Class C
Purchase Agreement $
K. The amount equal to the aggregate
amount of accrued but unpaid Class D
Servicing Fees which will be paid to
the Servicer (after giving effect to
the application of Class D Available
Funds thereto pursuant to Section
4.9) $
L. The amount equal to the Class D
Monthly Interest plus the amount of
any past due Class D Monthly
Interest which will be paid to the
Class D Certificateholders $
81
M. The amount equal to the Class D
Investor Loss Amount, if any, for
the prior Due Period which will be
treated as a portion of Available
Principal Collections $
N. The amount equal to the aggregate
amount by which the Class C Investor
Interest has been reduced below the
initial Class D Investor Interest
for reasons other than the payment
of principal to the Class D
Certificateholders (but not in
excess of the aggregate amount of
such reductions which have not been
previously reimbursed) which will be
treated as a portion of Available
Principal Collections $
O. The balance, if any, after giving
effect to the payments made pursuant
to subparagraphs (A) through (N)
above to be applied as Shared Excess
Finance Charge Collections for such
Distribution Date $
6. REALLOCATED PRINCIPAL COLLECTIONS
Pursuant to Section 4.12, the Servicer does hereby instruct the Trustee
to withdraw from the Collection Account and apply Reallocated Principal
Collections pursuant to Section 4.12 with respect to the related Due Period in
the following amounts:
A. Reallocated Class D
Principal Collections $
B. Reallocated Class C Principal $
Collections
C. Reallocated Class B Principal
Collections $
82
7. ACCRUED AND UNPAID AMOUNTS
After giving effect to the withdrawals and transfers to be made in
accordance with this notice, the following amounts will be accrued and unpaid
with respect to all Due Periods preceding the current calendar month
A. Subsections 4.9(a)(i) and (b)(i):
(1) The aggregate amount of the
Class A Deficiency Amount $
(2) The aggregate amount of
Class B Deficiency Amount $
B. Subsections 4.9(a)(ii) and (b)(ii):
(1) The aggregate amount of all
accrued and unpaid Class A
Servicing Fee $
(2) The aggregate amount of all
accrued and unpaid Class B
Servicing Fee $
C. Section 4.10:
(1) The aggregate amount of all
unreimbursed Class A Investor
Charge-Offs $
(2) The aggregate amount of all
unreimbursed Class B Investor
Charge-Offs $
(3) The aggregate amount of all
unreimbursed Class C Investor
Charge-Offs $
83
(4) The aggregate amount of all
unreimbursed Class D Investor
Charge-Offs $
IN WITNESS WHEREOF, the undersigned has duly executed this
certificate this __ day of _______, ____.
SPIRIT OF AMERICA NATIONAL BANK,
Servicer
By:___________________________
Name:
Title:
84
EXHIBIT C
FORM OF MONTHLY CERTIFICATEHOLDERS' STATEMENT
Series 1997-1
SPIRIT OF AMERICA NATIONAL BANK
CHARMING SHOPPES MASTER TRUST
Under Section 5.2 of the Series 1997-1 Supplement dated as of November
25, 1997 (the "Series 1997-1 Supplement", and together with the Second Amended
and Restated Pooling and Servicing Agreement dated as of November 25, 1997, the
"Pooling and Servicing Agreement") by and among Charming Shoppes Receivables
Corp., as Seller, Spirit of America National Bank ("Spirit"), as Servicer, and
First Union National Bank, as Trustee, Spirit, as Servicer, is required to
prepare certain information each month regarding current distributions to Series
1997-1 Certificateholders and the performance of the Charming Shoppes Master
Trust (the "Trust") during the previous month. The information which is required
to be prepared with respect to the Distribution Date of _______, ______ 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 Series 1997-1 Certificate (a
"Certificate"). Certain other information is presented based on the aggregate
amounts for the Trust as a whole. Capitalized terms used in this Statement have
their respective meanings set forth in the Pooling and Servicing Agreement.
A. Information Regarding the Current Monthly Distribution (Stated on the
Basis of $1,000 Original Certificate Principal Amount)
7.0.1. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of Class A
Monthly Principal .................. $________
7.0.2. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of Class B
Monthly Principal .................. $________
7.0.3. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of
Class C Monthly Principal .......... $________
7.0.4. THE AMOUNT OF THE CURRENT MONTHLY
85
distribution in respect of
Class D Monthly
Principal .......................... $________
7.0.5. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of Class A
Monthly Interest ................... $________
7.0.6. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of Class A
Deficiency Amounts ................. $________
7.0.7. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of Class A
Additional Interest ................ $________
7.0.8. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of Class B
Monthly Interest ................... $________
7.0.9. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of Class B
Deficiency Amounts ................. $________
7.0.10. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of Class B
Additional Interest ................ $________
7.0.11. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of
Class C Monthly Interest ........... $________
7.0.12. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of any
accrued and unpaid Class C
Deficiency Amounts ................. $________
86
7.0.13. THE AMOUNT OF THE CURRENT MONTHLY
distribution in respect of
Class D Monthly Interest ................ $________
B. Information Regarding the Performance of the Trust
7.0.14. COLLECTION OF PRINCIPAL RECEIVABLES
7.0.14.1. The aggregate amount of
Collections of Principal
Receivables processed
during the related Due
Period which were allocated
in respect of the Class A
Certificates .................. $________
7.0.14.2. The aggregate amount of
Collections of Principal
Receivables processed
during the related Due
Period which were allocated
in respect of the Class B
Certificates .................. $________
7.0.14.3. The aggregate amount of
Collections of Principal
Receivables processed
during the related Due
Period which were allocated
in respect of the Class C
Certificates .................. $________
7.0.14.4. The aggregate amount of
Collections of Principal
Receivables during the
related Due Period which
were allocated in respect
of the Class D Certificates ... $________
7.0.15. PRINCIPAL RECEIVABLES IN THE TRUST
7.0.15.1. The aggregate amount of Principal
Receivables in the Trust as of
the end of the day on the last
87
day of the preceding Due
Period ........................ $________
7.0.15.2. The Excess Funding Amount
(the aggregate amount on
deposit in the Excess Funding
Account) as of the end of the
day on the last day of the
preceding Due Period .......... $________
7.0.15.3. The Series Investor Interest
as of the last day of the
preceding Due Period .......... $________
7.0.15.4. The Floating Allocation
Percentage with respect
to the related Due
Period ........................ ______%
7.0.15.5. The Class A Floating
Allocation with respect
to the related Due
Period ........................ ______%
7.0.15.6. The Class B Floating
Allocation with respect
to the related Due
Period ........................ ______%
7.0.15.7. The Class C Floating
Allocation with respect to
the related Due
Period ........................ ______%
7.0.15.8 The Class D Floating
Allocation with respect
to the related Due Period ..... ______%
7.0.15.9. The Principal Allocation
Percentage with respect to
the related Due Period ........ ______%
7.0.15.10. The Class A Fixed Allocation
with respect to the related
Due Period .................... ______%
88
7.0.15.11. The Class B Fixed Allocation
with respect to the related
Due Period .................... ______%
7.0.15.12. The Class C Fixed
Allocation with respect
to the related Due
Period ........................ ______%
7.0.15.13. The Class D Fixed
Allocation with respect
to the related Due Period ....... ______%
7.0.16. DELINQUENT BALANCES
The aggregate amount of outstanding balances in the Accounts
which were delinquent as of the day on the last day of the
preceding Due Period:
Aggregate
Account
Balance
-------
(a) 30-59 days .................................... $_______
(b) 60-89 days .................................... $_______
(c) 90-119 days ................................... $_______
(d) 120 or more days ............................... $_______
Total: $_______
7.0.17. INVESTOR LOSS AMOUNT
7.0.17.1. The Investor Loss
Amount for the related
Due Period ............... $
7.0.17.2. The Class A Investor
Loss Amount for the
related Due Period ....... $
7.0.17.3. The Class B Investor
Loss Amount for the
related Due Period ....... $
89
(d) The Class C Investor Loss
Amount for the related
Due Period .................... $
(e) The Class D Investor
Loss Amount for the related
Due Period .................... $
7.0.18. INVESTOR CHARGE OFFS
7.0.18.1. The aggregate amount of
Class A Investor Charge
Offs for the related
Due Period .................... $
7.0.18.2. The aggregate amount of
Class A Investor Charge
Offs set forth in 5(a)
above per $1,000 of
original certificate
principal amount .............. $
7.0.18.3. The aggregate amount of
Class B Investor Charge
Offs for the related
Due Period .................... $
7.0.18.4. The aggregate amount of
Class B Investor Charge
Off set forth in 5(c)
above per $1,000 of original
certificate principal
amount ........................ $
7.0.18.5. The aggregate amount of
Class C Investor Charge Offs
for the related Due
Period ........................ $
7.0.18.6. The aggregate amount of
Class C Investor Charge
Offs set forth in 5(e)
above per $1,000 of original
certificate principal amount .. $
90
7.0.18.7. The aggregate amount of
Class D Investor
Charge Offs for the
related Due Period ........... $
7.0.18.8. The aggregate amount of
Class D Investor
Charge Offs set forth
in 5(e) above per $1,000
of original certificate
principal amount ............. $
7.0.18.9. The aggregate amount of
Class A Investor Charge
Offs reimbursed on this
Distribution Date ............ $
7.0.18.10. The aggregate amount of
Class A Investor Charge
Offs set forth in 5(i)
above per $1,000 original
certificate principal
amount reimbursed on this
Distribution Date ............ $
7.0.18.11. The aggregate amount of
Class B Investor Charge
Offs reimbursed on this
Distribution Date ............ $
7.0.18.12. The aggregate amount of
Class B Investor Charge Offs
set forth in 5(k) above per
$1,000 original certificate
principal amount reimbursed
on this Distribution
Date ......................... $
7.0.18.13. The aggregate amount of
Class C Investor Charge Offs
reimbursed on this
Distribution Date ............ $
91
7.0.18.14. The aggregate amount of
Class C Investor Charge Offs
set forth in 5(m) above per
$1,000 original certificate
principal amount reimbursed
on this Distribution Date .... $
7.0.18.15. The aggregate amount of
Class D Investor Charge
Offs reimbursed on
this Distribution Date ....... $
7.0.18.16. The aggregate amount of
Class D Investor Charge
Offs set forth in 5(o)
above per $1,000
original certificate
principal amount reimbursed
on this Distribution Date .... $
7.0.19. INVESTOR MONTHLY SERVICING FEE
7.0.19.1. The amount of the Class A
Servicing Fee payable by the
Trust to the Servicer for the
related Due Period ........... $
7.0.19.2. The amount of the Class B
Servicing Fee payable by the
Trust to the Servicer for the
related Due Period ........... $
7.0.19.3. The amount of the Class C
Servicing Fee payable by the
Trust to the Servicer for the
related Due Period ........... $
7.0.19.4. The amount of the Class D
Servicing Fee payable
by the Trust to the Servicer
for the related Due Period ... $
92
7.0.20. REALLOCATIONS
7.0.20.1. The amount of Reallocated
Class D Principal
Collections with respect to
this Distribution Date ........ $
7.0.20.2. The amount of Reallocated
Class C Principal
Collections with respect to
this Distribution Date ........ $
7.0.20.3. The amount of Reallocated
Class B Principal Collections
with respect to this
Distribution Date ............. $
7.0.20.4. The Class D Investor
Interest as of the close of
business on this Distribution
Date .......................... $
7.0.20.5. The Class C Investor Interest
as of the close of business on
this Distribution Date ........ $
7.0.20.6. The Class B Investor Interest
as of the close of business on
this Distribution Date ........ $
7.0.20.7. The Class A Investor Interest
as of the close of business on
this Distribution Date ........ $
7.0.21. COLLECTION OF FINANCE CHARGE RECEIVABLES
7.0.21.1. The aggregate amount of
Collections of Finance
Charge Receivables received
during the related Due
Period which were allocated
in respect of Class A
Certificates .................. $
7.0.21.2. The aggregate amount of
93
Collections of Finance
Charge Receivables received
during the related Due
Period which were allocated
in respect of the Class B
Certificates .................. $
7.0.21.3. The aggregate amount of
Collections of Finance
Charge Receivables received
during the related Due
Period which were allocated
in respect of the Class C
Certificates .................. $
7.0.21.4. The aggregate amount of
Collections of Finance
Charge Receivables received
during the related Due
Period which were allocated
in respect of the Class D
Certificates .................. $
7.0.22. PRINCIPAL FUNDING ACCOUNT
7.0.22.1. The principal amount on
deposit in the Principal
Funding Account on this
Distribution Date ............. $
7.0.22.2. The Principal Shortfall
with respect to the related
Due Period .................... $
7.0.22.3. The Principal Funding
Investment Proceeds
deposited in the Collection
Account on the related
Distribution Date ............. $
7.0.22.4. The Principal Funding
Investment Shortfall .......... $
94
7.0.23. SERIES EXCESS FUNDING ACCOUNT
7.0.23.1. The amount on deposit
in the Series Excess
Funding Account on this
Distribution Date ............. $
7.0.23.2. The investment proceeds
deposited from the Series
Excess Funding Account
to the Collection
Account on the related
Distribution Date ............. $
7.0.23.3. The Series Excess Funding
Account Surplus ............... $
7.0.24. SERIES EXCESS FUNDING RESERVE ACCOUNT
7.0.24.1. The principal amount on
deposit in the Series
Excess Funding Reserve
Account on this
Distribution Date ............. $
7.0.24.2. The investment proceeds
deposited from the Series
Excess Funding Reserve
Account to the Collection
Account on the related
Distribution Date ............. $
7.0.24.3. The Series Excess Funding
Account Investment Shortfall .. $
7.0.24.4. The Series Excess Funding
Reserve Draw Amount ........... $
7.0.24.5. The Series Excess Funding
Reserve Account Surplus ....... $
95
7.0.25. AVAILABLE FUNDS
7.0.25.1. The amount of Class A
Available Funds on deposit
in the Collection Account
on this Distribution Date........ $
7.0.25.2. The amount of Class B
Available Funds on deposit
in the Collection Account
on this Distribution Date........ $
7.0.25.3. The amount of Class C
Available Funds on deposit in
the Collection Account on
this Distribution Date........... $
7.0.25.4. The amount of Class D
Available Funds on
deposit in the Collection
Account on this Distribution
Date............................. $
7.0.26. PORTFOLIO YIELD
The Portfolio Yield for the
related Due Period......................... %
7.0.27. SHARED PRINCIPAL COLLECTIONS
(a) The Cumulative Principal
Shortfall with respect to such
Distribution Date................. $
(b) The Shared Principal
Collections allocable to
the Certificates on such
Distribution Date................. $
7.0.28. SHARED EXCESS FINANCE CHARGE COLLECTIONS
(a) The Finance Charge Shortfall
with respect to such
Distribution Date................ $
96
(b) The Shared Excess Finance
Charge Collections allocable
to the Certificates on such
Distribution Date.......................... $
C. Floating-Rate Determinations
1. LIBOR for the Interest
Period ending on this
Distribution Date.......................... %
SPIRIT OF AMERICA NATIONAL
BANK, Servicer
By:
Name:
Title:
97
EXHIBIT D-1
CLASS A INTEREST RATE CAP
98
EXHIBIT D-2
CLASS B INTEREST RATE CAP
99
CHARMING SHOPPES RECEIVABLES CORP.
Seller
SPIRIT OF AMERICA NATIONAL BANK
Servicer
and
FIRST UNION NATIONAL BANK
Trustee
on behalf of the Series 1997-1 Certificateholders
----------------------------------
SERIES 1997-1 SUPPLEMENT
Dated as of November 25, 1997
to
SECOND AMENDED AND RESTATED POOLING AND
SERVICING AGREEMENT
Dated as of November 25, 1997
----------------------------------
$83,500,000
CHARMING SHOPPES MASTER TRUST
SERIES 1997-1
100
TABLE OF CONTENTS
PAGE
SECTION 1. Designation 1
SECTION 2. Definitions 1
SECTION 3. Servicing Compensation 20
SECTION 4. Reassignment and Transfer Terms 21
SECTION 5. Delivery and Payment for the Investor Certificates 21
SECTION 6. Depository; Form of Delivery of Series 1997-1 Certificates 21
SECTION 7. Article IV of Agreement 21
SECTION 8. Article V of the Agreement. 41
SECTION 9. Series 1997-1 Early Amortization Events 45
SECTION 10. Series 1997-1 Termination 47
SECTION 11. Limitations on Addition of Accounts 47
SECTION 12. Ratification of Agreement 47
SECTION 13. Counterparts 47
SECTION 14. Governing Law 47
SECTION 15. No Petition 48
SECTION 16. Tax Representation and Covenant 48
SECTION 17. Certain Tax Related Amendments 48
101
EXHIBITS
EXHIBIT A-1 Form of Class A Certificate
EXHIBIT A-2 Form of Class B Certificate
EXHIBIT A-3 Form of Class C Certificate
EXHIBIT A-4 Form of Class D Certificate
EXHIBIT B Form of Monthly Payment Instructions and Notification to the Trustee
EXHIBIT C Form of Monthly Certificateholders' Statement
EXHIBIT D-1 Form of Class A Cap
EXHIBIT D-2 Form of Class B Cap
