EXHIBIT 10.1
SCHEDULE
to the
Master Agreement
dated as of May 17, 2001
between
Xxxxxx Brothers Special Financing Inc. ("Party A"),
and
The MBNA CREDIT CARD MASTER NOTE TRUST ("Party B"), a trust formed
pursuant to a trust agreement dated as of May 4, 2001, as amended and
restated as of May 24, 2001 (as amended and restated, the "Trust
Agreement").
Part 1. Termination Provisions
In this Agreement:
(a) "Specified Entity" shall not apply for purposes of this Agreement.
(b) "Specified Transaction" will have the meaning specified in Section
14 of this Agreement.
(c) The "Breach of Agreement" provisions of Section 5(a)(ii), the
"Misrepresentation" provisions of Section 5(a)(iv), the "Default
under Specified Transaction" provisions of Section 5(a)(v), the
"Cross Default" provisions of Section 5(a)(vi), the "Merger
Without Assumption" provisions of Section 5(a)(viii), the "Tax
Event" provisions of Section 5(b)(ii), "Tax Event Upon Merger"
provisions of Section 5(b)(iii), and the "Credit Event Upon
Merger" provisions of Section 5(b)(iv) will not apply to Party A
and will not apply to Party B. Solely with respect to payments
required to be made by Party A after the occurrence of an Early
Redemption Event with respect to the Class A notes, the word
"third" in the final line of Section 5(a)(i) shall be replaced
with "12:00 noon New York City time of the first (or such other
time as may be mutually agreed to by Party A, Party B and the Note
Rating Agencies)".
(d) The "Automatic Early Termination" provisions of Section 6(a) will
not apply to Party A and will not apply to Party B.
(e) Payments on Early Termination. For the purpose of Section 6(e) of
this Agreement, Market Quotation and the Second Method will apply;
provided, however, that in the case of an Event of Default with
respect to Party A as the Defaulting Party or a Termination Event
with respect to Party A as the Affected Party, the related
Settlement Amount, if negative, will be deemed to be zero if the
Market Quotation (as such term is modified pursuant to Part 1 (f)
below) cannot be determined.
(f) Market Quotation. Notwithstanding anything to the contrary in the
definition of Market Quotation in Section 14, in the case of an
Event of Default with respect to Party A as the Defaulting Party
or a Termination Event with respect to Party A as the Affected
Party, the Market Quotation, if negative, will be deemed to be the
negative quotation, if any, with the highest absolute value
received from any Reference Market-maker, even if only one
quotation is provided, with which Party B is able, using its best
efforts, to enter into a Replacement Transaction even if Party B
reasonably believes such Market Quotation would not produce a
commercially reasonable result.
(g) "Reference Market-maker" will not have the meaning specified in
Section 14, but will instead mean the following:
"Reference Market-maker" means five leading dealers in the
relevant market selected by the party determining the Market
Quotation in good faith (a) from among dealers which are
rated not lower than investment grade by S&P and Xxxxx'x
which satisfy the criteria that such party applies generally
at that time in deciding whether to offer or make an
extension of credit and (b) to the extent practicable, from
among dealers having an office in the same city.
(h) "Termination Currency" means United States Dollars ("USD").
Part 2. Tax Representations.
(a) Payer Tax Representations. For the purpose of Section 3(e) of
this Agreement, Party A and Party B will each make the following
representation:
It is not required by any applicable law, as modified by the
practice of any relevant governmental revenue authority, of any
Relevant Jurisdiction to make any deduction or withholding for or
on account of any Tax from any payment (other than interest under
Sections 2(e), 6(d)(ii) and 6(e) of this Agreement) to be made by
it to the other party under this Agreement. In making this
representation, it may rely on (i) the accuracy of any
representation made by the other party pursuant to Section 3(f) of
this Agreement, (ii) the satisfaction of the agreement contained
in Section 4(a)(i) or 4(a)(iii) of this Agreement and the accuracy
and effectiveness of any document provided by the other party
pursuant to Section 4(a)(i) and 4(a)(iii) of this Agreement; and
(iii) the satisfaction of the agreement of the other party
contained in Section 4(d) of this Agreement, provided that it
shall not be a breach of this representation where reliance is
placed on clause (ii) and the other party does not deliver a form
or document under Section 4(a)(iii) by reason of material
prejudice to its legal or commercial position.
(b) Payee Representations. For the purpose of Section 3(f) of this
Agreement, Party A and Party B make the following representations:
(i) The following representation will apply to Party B:
For United States federal income tax purposes it is a
"United States Person" as defined in 7701 (a)(30) of the
Internal Revenue Code.
(ii) The following representation will apply to Party A:
Party A represents that it is wholly exempt from deduction
or withholding of Tax imposed by the United States or any
political subdivision or taxing authority thereof or therein
with respect to all amounts to be made in connection with
this Agreement because it is a "domestic corporation" as
defined in 7701(a)(3) and 7701(a)(4) of the Internal Revenue
Code.
Part 3. Agreement to Deliver Documents.
For the purpose of Sections 3(d), 4(a)(i) and (ii) of this
Agreement, each party agrees to deliver the following documents,
as applicable:
(a) Tax forms, documents or certificates to be delivered are:
Party required to deliver document-
Form/Document/Certificate-
Date by which
to be delivered-Covered by Section 3(d) Representation
Party B-Any form or document that may be reasonably requested, and that
Party B is eligible to provide, in order to allow the requesting party
to make a payment without (or with reduced) withholding Tax.-Promptly
upon reasonable demand by the other party.-Yes
Party A-Any form or document that may be reasonably requested, and that
Party A is eligible to provide, in order to allow the requesting party
to make a payment without (or with reduced) withholding Tax.-Promptly
upon reasonable demand by the other party.-Yes
(b) Other documents to be delivered are:
Party required to deliver document-
Form/Document/Certificate-
Date by which to be delivered-Covered by Section 3(d)
Party A-Opinions of counsel for Party A substantially in the form of
Exhibit A to this Schedule-Upon execution of this Agreement-Yes
Party A-An incumbency certificate with respect to the signatory of this
Agreement-Upon execution of this Agreement-Yes
Party B-An opinion of counsel for Party B substantially in the form of
Exhibit B to this Schedule-Upon execution of this Agreement-Yes
Party B-An incumbency certificate with respect to the signatory of this
Agreement-Upon execution of this Agreement-Yes
Part 4. Miscellaneous.
(a) Addresses for Notices. For the purpose of Section 12(a):
Address for notices or communications to Party A:
-Address:-Xxxxxx Brothers Inc.
Transaction Management Department
One World Trade Center, 27th Floor
New York, New York 10281 USA
-Attention:-Transaction Management
-Telephone No.:-(646) 000-0000
-Facsimile No.:-(646) 856-0609
--
-For all purposes.-
Address for notices or communications to Party B:
Address: MBNA Credit Card Master Note Trust
c/o MBNA America Bank,
National Association, as Beneficiary
Securitization Servicing
Wilmington, Delaware 19884-2824
Attention: Xxxx Xxxxxx
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
For all purposes.
(b) Process Agent. For the purpose of Section 13(c):
Party A appoints as its Process Agent: Not applicable.
Party B appoints as its Process Agent: Not applicable.
(c) Offices. The provisions of Section 10(a) will apply to this
Agreement.
(d) Multibranch Party. For the purpose of Section 10(c) of this
Agreement.
Party A is not a Multibranch Party.
Party B is not a Multibranch Party.
(e) Calculation Agent. The Calculation Agent is the Indenture
Trustee, unless otherwise specified in a Confirmation in relation
to the relevant Transaction.
(f) Credit Support Document. Details of any Credit Support Document:
In the case of Party A: Guarantee of Xxxxxx Brothers Holdings Inc.
dated as of May 31, 2001 among Party A and the Credit Support
Provider.
In the case of Party B: Not applicable.
(g) Credit Support Provider.
In relation to Party A: Xxxxxx Brothers Holdings Inc. (the "Party
A Credit Support Provider")
In relation to Party B: Not applicable
(h) Governing Law. This Agreement will be governed by and construed
in accordance with the laws of the State of New York (without
reference to choice of law doctrine but without prejudice to the
provisions of Section 5-1401 of the General Obligations Law of the
State of New York).
(i) Netting of Payments. Subparagraph (ii) of Section 2(c) of this
Agreement will apply to any of the Transactions, except that it
will not apply to payments by each Party to the other if Party B
so notifies Party A ten (10) days in advance of the date such
Payments are due.
(j) "Affiliate" will have the meaning specified in Section 14 of this
Agreement, except that with respect to Party B there shall be
deemed to be no Affiliates.
Part 5. Other Provisions.
(a) Confirmation. Each Confirmation supplements, forms part of, and
will be read and construed as one with, this Agreement. A form of
Confirmation is set forth as Exhibit C hereto.
(b) Waiver of Trial By Jury. Each party waives, to the fullest extent
permitted by applicable law, any right it may have to a trial by
jury in respect of any suit, action or proceeding relating to this
Agreement. Each party (i) certifies that no representative, agent
or attorney of the other party has represented, expressly or
otherwise, that such other party would not, in the event of such a
suit, action or proceeding, seek to enforce the foregoing waiver
and (ii) acknowledges that it and the other party have been
induced to enter this Agreement by, among other things, the mutual
waivers and certifications in this Section.
(c) Non-Petition. Party A hereby agrees that it will not bring any
action (whether in bankruptcy or otherwise) against Party B in any
court prior to the date which is one year and one day after all
Notes (as such term is defined in the Indenture) of Party B have
been paid in full.
(d) Assignment. In the event the long-term senior debt rating of the
Party A Credit Support Provider is lowered to below the category
of BBB- by Standard & Poor's Corporation ("S&P") or Baa3 by
Xxxxx'x Investor Services ("Moody's") or such rating agencies'
then equivalent ratings, or such ratings are withdrawn by either
S&P or Moody's, Party B shall direct Party A to assign and
delegate, and Party A shall assign and delegate, its rights and
obligations under any Transaction to a replacement counterparty.
(e) Provision for Payments from Party B. Notwithstanding anything
contained in this Agreement to the contrary, any amount required
to be paid by Party B pursuant to this Agreement will be payable
only to the extent provided in, and from amounts on deposit in the
Interest Funding sub-Account for the Class A(2001-1) Notes which
are specifically available to be applied therefor pursuant to,
Section 3.13(d) of the Indenture Supplement, as determined
pursuant to Section 2.03(b) of the Terms Document and any amounts
specifically available to be applied therefor pursuant to Section
2.12 of the Terms Document (as such terms are defined in the
Confirmation).
(f) Relationship Between Parties. Each party will be deemed to
represent to the other party on the date on which it enters into
this Agreement that (absent a written agreement between the
parties that expressly imposes affirmative obligations to the
contrary):
(i) Non-Reliance. It is acting for its own account, and it has
made its own independent decisions to enter into this Agreement
and as to whether this Agreement is appropriate or proper for it
based upon its own judgment and upon advice from such advisers as
it has deemed necessary. It is not relying on any communication
(written or oral) of the other party as investment advice or as a
recommendation to enter into this Agreement; it being understood
that information and explanations related to the terms and
conditions of this Agreement shall not be considered investment
advice or a recommendation to enter into this Agreement. No
communication (written or oral) received from the other party
shall be deemed to be an assurance or guarantee as to the expected
results of this Agreement.
(ii) Assessment and Understanding. It is capable of assessing
the merits of and understanding (on its own behalf or through
independent professional advice), and understands and accepts, the
terms, conditions and risks of this Agreement. It is also capable
of assuming, and assumes, the risks of this Agreement.
(iii) Status of Parties. The other party is not acting as a
fiduciary for or as adviser to it in respect of this Agreement.
(g) Additional Representations. Each of Party A and Party B
represents that it is an "eligible swap participant" as defined in
Commodities Futures Trading Commission Rule 35.1(b)(2)
(17 C.F.R. 35(b)(2)).
(h) Negative Interest Rates. Party A and Party B agree that:
if, with respect to a Calculation Period for a Transaction, a
party ("X") is obligated to pay a Floating Amount that is a
negative number (either by reason of a negative Floating Rate or
the subtraction of a Spread from the Floating Rate), the Floating
Amount with respect to X for that Calculation Period will be
deemed to be zero, and the other party ("Y") will pay to X the
absolute value of the negative Floating Amount, in addition to any
amounts otherwise owned by Y to X, on the Payment Date such
Floating Amount would have been payable if it had been a positive
number. Any amounts paid by Y to X pursuant to this provision
will be paid to such account as X may designate (unless Y gives
timely notice of a reasonable objection to such designation) in
the currency in which that Floating Amount would have been paid if
it had been a positive number (and without regard to the currency
in which Y is otherwise obligated to make payments).
(i) Limited Recourse. It is expressly understood and agreed by the
parties hereto that (i) this Agreement and each Transaction
entered into pursuant to this Agreement is entered into by MBNA
America Bank, National Association, not individually or personally
but solely as Beneficiary of the MBNA Credit Card Master Note
Trust (the "Trust") in the exercise of the powers and authority
conferred and vested in it, (ii) the representations, undertakings
and agreements herein made on the part of the Trust are made and
intended not as personal representations, undertakings and
agreements by the Beneficiary but are made and intended for the
purpose of binding only the Trust, (iii) nothing herein contained
shall be construed as creating any liability on the part of the
Beneficiary, individually or personally, to perform any covenant
either expressed or implied contained herein, all such liability,
if any, being expressly waived by the parties who are signatories
to this Agreement and by any Persons claiming by, through or under
such parties; provided, however, that the Beneficiary shall be
liable in its individual capacity for its own willful misconduct
or gross negligence and (iv) under no circumstances shall the
Beneficiary be personally liable for the payment of any
indebtedness or expenses of the Trust or be liable for the breach
or failure of any obligation, representation, warranty or covenant
made or undertaken by the Trust under this Agreement.
The parties executing this Schedule have executed the Master
Agreement and have agreed as to the contents of this Schedule.
XXXXXX BROTHERS SPECIAL FINANCING INC.
By: _/S/ XXXXXX X.
GUGLIELMO_______________
Name: XXXXXX X. XXXXXXXXX
Title: SENIOR VICE PRESIDENT
MBNA CREDIT CARD MASTER NOTE TRUST
By: MBNA America Bank, National
Association,
as Beneficiary
By: __/S/ XXXXXXXXXXX A
HALMY_________________
Name: XXXXXXXXXXX X XXXXX
Title: VICE PRESIDENT
EXHIBIT A to Schedule
[Form of Opinion of Counsel for Party A]
EXHIBIT B to Schedule
[Form of Opinion of Counsel for Party B]
EXHIBIT C to Schedule
Date: May 31, 2001
To: MBNA Credit Card Master Note Trust
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
From: Xxxxxx Brothers Special Financing Inc.
Subject: Swap Transaction (Ref. No. 170121/273477L)
The purpose of this communication is to set forth the terms
and conditions of the swap transaction entered into on the Trade Date
referred to below (the "Swap Transaction"), between the MBNA CREDIT CARD
MASTER NOTE TRUST ("Party B"), but only relates to the MBNAseries 5.75%
Class A(2001-1) Notes (the "Class A Notes") issued pursuant to the
Indenture dated as of May 24, 2001 (the "Indenture") as supplemented by
the MBNAseries Indenture Supplement dated as of May 24, 2001 (the
"Indenture Supplement") and as further supplemented by the Class A(2001-
1) Terms Document dated as of May 31, 2001 (the "Terms Document"), and
XXXXXX BROTHERS SPECIAL FINANCING INC. ("Party A"). This communication
constitutes a "Confirmation" as referred to in the Swap Agreement
specified below.
This Confirmation supplements, forms part of, and is subject
to, the ISDA Master Agreement dated as of May 17, 2001 between Party A
and Party B (the "Master Agreement"). All provisions contained in, or
incorporated by reference to, such Master Agreement shall govern this
Confirmation except as expressly modified below.
This Confirmation and the Schedule to the Master Agreement
(the "Schedule") each incorporate the definitions and provisions
contained in (i) the 1991 ISDA Definitions (as supplemented by the 1998
Supplement) (as published by the International Swaps and Derivatives
Association, Inc.) (the "Definitions"), without regard to any amendment
to the Definitions subsequent to the date hereof, and (ii) the Terms
Document, the Indenture Supplement and the Indenture. In the event of
any inconsistency between the definitions in the Terms Document and any
of the Indenture Supplement, the Indenture, the Definitions, the
Schedule or this Confirmation, the definitions in the Terms Document
will govern; in the event of any inconsistency between the definitions
in the Indenture Supplement and any of the Indenture, the Definitions,
the Schedule or this Confirmation, the definitions in the Indenture
Supplement will govern; in the event of any inconsistency between the
definitions in the Indenture and any of the Definitions, the Schedule or
this Confirmation, the definitions in the Indenture will govern; in the
event of any inconsistency between this Confirmation and either the
Schedule or the Definitions, this Confirmation will govern; and in the
event of any inconsistency between the Schedule and the Definitions, the
Schedule will govern.
The terms of this particular Swap Transaction to which this
Confirmation relates are as follows:
Trade Date:-May 17, 2001
Effective Date:-The Issuance Date for the Class A Notes
Termination Date:-The Expected Principal Payment Date; provided,
however, that in the event of an Early Redemption Event described in
Section 1201(c) of the Indenture or an Event of Default and acceleration
under the Indenture with respect to the Class A Notes, the Termination
Date will be the earlier of (i) the date on which the Notional Amount is
zero and (ii) the Expected Principal Payment Date.
Fixed Amounts:-
Fixed Rate Payer:-Party A.
Fixed Rate:-5.75%
Fixed Amount for Initial Fixed Rate Payer Payment Date:-$7,187,500
Fixed Amount:-For each Fixed Rate Payer Payment Date other than the
initial Fixed Rate Payer Payment Date, an amount calculated on a formula
basis for that Fixed Rate Payer Payment Date as follows:
Fixed Rate
Fixed =NotionalxFixed
AmountAmount Rate
12
Fixed Rate Notional
Amount:-For the initial Fixed Rate Payer Payment Date, $1,000,000,000
(the Initial Dollar Principal Amount of the Class A Notes), and for each
Fixed Rate Payer Payment Date thereafter the Outstanding Dollar
Principal Amount of the Class A Notes as of the Record Date immediately
preceding such Fixed Rate Payer Payment Date
Fixed Rate Payer Payment Dates:-Each Transfer Date.
Floating Amounts:-
Floating Rate Payer:-Party B.
Calculation Periods:-For the initial Floating Rate Payer Payment Date,
the period from and including the Effective Date through the day
preceding the first Interest Payment Date; and for each Floating Rate
Payer Payment Date thereafter, each Calculation Period will be the
period from and including the previous Interest Payment Date through the
day preceding the current Interest Payment Date.
Floating Rate Payer PaymentDates:-Each Transfer Date.
Floating Rate Option:-USD-LIBOR-BBA; provided, however, that the last
sentence of the definition of "USD-LIBOR-Reference Banks" is hereby
amended to replace the penultimate use of "that Reset Date" with "the
day that is two London Banking Days preceding that Reset Date."
Reset Dates:-Means, with respect to the initial Floating Rate Payer
Payment Date, the Effective Date, and with respect to each Floating Rate
Payer Payment Date after the initial Floating Rate Payer Payment Date,
the first day of the related Calculation Period for such Floating Rate
Payer Payment Date.
Designated Maturity:-One month.
Floating Rate Spread:-
Floating Amount for Initial Floating Rate Payer Payment Date:-
$5,333,406.11.
Floating Rate Notional Amount:-For the initial Floating Rate Payer
Payment Date, $1,000,000,000 (the Initial Dollar Principal Amount of the
Class A Notes), and for each Floating Rate Payer Payment Date thereafter
the Outstanding Dollar Principal Amount of the Class A Notes as of the
Record Date immediately preceding such Floating Rate Payer Payment Date.
Floating Rate Day Count Fraction:-Actual/360.
Compounding:-Not Applicable.
Calculation Agent: -Indenture Trustee.
Business Days: -New York and Newark, Delaware.
Credit Support Document: -Guarantee of Xxxxxx Brothers Holdings Inc.
dated as of May 31, 2001 among Party A and the Credit Support Provider.
Other Provisions:-If at any time during the Term of the Swap Transaction
(i) the Party A Credit Support Provider's short-term senior debt rating
from S&P is below A-1, or is withdrawn by S&P, or (ii) in the case of
any entity assuming Party A's interests and obligations under this
Confirmation, the Schedule and the Master Agreement that does not have a
short-term senior debt rating from S&P, such entity's long-term senior
debt rating from S&P is below A+, or is withdrawn by S&P, Party B shall
establish and maintain with a Qualified Institution, in the name of
Party B for the benefit of the holders of the Class A Notes, the
interest reserve account as a segregated trust account held for the
benefit of holders of the Class A Notes (the "Interest Reserve Ac-
count"). Within thirty days of such rating or withdrawal, Party A shall
fund the Interest Reserve Account in an amount equal to one-twelfth of
the product of (a) the Fixed Rate, and (b) the Outstanding Dollar Prin-
cipal Amount of the Class A Notes on the Record Date preceding such
rating or withdrawal for reinvestment in accordance with the Terms
Document; provided, however, that the failure of Party A to adequately
fund the Interest Reserve Account within thirty days of such rating or
withdrawal shall not constitute an Event of Default pursuant to the
provisions of subsection 5(a) or a Termination Event pursuant to the
provisions of subsection 5(b). Party A shall treat the amount on
deposit in the Interest Reserve Account as its money for tax purposes.
After establishment of the Interest Reserve Account, in the event there
shall occur an Early Termination Date as a result of an Event of Default
with respect to Party A as the Defaulting Party or a Termination Event
with respect to Party A as the Affected Party, the funds then contained
in the Interest Reserve Account will be treated as MBNAseries Available
Funds to the extent provided in the Terms Document and the Indenture
Supplement. Upon termination of the Interest Reserve Account as
provided in the Terms Document after payment of all amounts owing to the
holders of the Class A Notes that are payable from such account, Party B
will release all amounts on deposit therein to Party A.
-If Party B notifies Party A that netting of payments will not apply to
any of the Transactions pursuant to Part 4(i) of the Schedule, each
payment obligation of Party B under Section 2(a)(i) of the Master
Agreement in respect of this Swap Transaction shall be subject to the
condition precedent that in respect of each such payment obligation each
amount payable by Party A with respect to this Swap Transaction shall be
paid by Party A by 12:00 noon, New York City time, on the relevant Fixed
Rate Payer Payment Date.
London Banking Day:-New York, New York and London, England.
Governing Law:-New York.
Offices:-Party A is not a Multibranch Party.
-Party B is not a Multibranch Party.
Payment Instructions
for Party A USD:-Chase Manhattan Bank
ABA # 000000000
A/C of Xxxxxx Brothers Special Financing Inc.
A/C # 066143543
Payment Instructions
for the Trust in USD:-The Bank of New York, New York
ABA# 000-000-000
A/C of MBNA Credit Card Master Note Trust
MBNAseries, Class A(2001-1)
A/C# 054640
-
Please confirm that the foregoing correctly sets forth the terms of our
agreement with respect to the Swap Transaction by signing in the space
provided below and sending a copy of the executed Confirmation to us.
It has been a pleasure working with you on this transaction and we look
forward to working with you again in the future.
Very truly yours,
XXXXXX BROTHERS SPECIAL FINANCING INC.
By:
Name:
Title:
Agreed and Accepted by:
MBNA CREDIT CARD MASTER NOTE TRUST
By: MBNA America Bank, National Association,
solely in its capacity as beneficiary
and not in its individual capacity
By:
Name:
Title:
DOCSDC1:124834.6
