EXHIBIT 4.2
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
Issuer
And
BNY MIDWEST TRUST COMPANY
Indenture Trustee
SERIES [200_-_] INDENTURE SUPPLEMENT
Dated as of [_______ __, 2001]
TABLE OF CONTENTS
ARTICLE I. Creation of the Series [200_-_] Notes.................................................... 1
Section 1.1 Designation..................................................................... 1
ARTICLE II. Definitions.............................................................................. 1
Section 2.1 Definitions..................................................................... 1
ARTICLE III. Noteholder Servicing Fee................................................................. 15
Section 3.1 Servicing Compensation.......................................................... 15
ARTICLE IV. Rights of Series [200_-_] Noteholders and Allocation and Application of Collections...... 15
Section 4.1 Collections and Allocations..................................................... 15
Section 4.2 Determination of Monthly Interest............................................... 18
Section 4.3 Determination of Monthly Principal.............................................. 19
Section 4.4 Application of Available Finance Charge Collections and Available Principal
Collections..................................................................... 20
Section 4.5 Investor Charge-Offs............................................................ 22
Section 4.6 Reallocated Principal Collections............................................... 22
Section 4.7 Excess Finance Charge Collections............................................... 23
Section 4.8 Shared Principal Collections.................................................... 23
Section 4.9 Certain Series Accounts......................................................... 23
Section 4.10 Reserve Account................................................................. 25
Section 4.11 Cash Collateral Account......................................................... 27
Section 4.12 Spread Account.................................................................. 28
Section 4.13 Investment Instructions......................................................... 30
Section 4.14 Controlled Accumulation Period.................................................. 31
Section 4.15 Suspension of Controlled Accumulation Period.................................... 32
Section 4.16 [Determination of LIBOR]........................................................ 33
Section 4.17 Pre-Funding Account............................................................. 34
Section 4.18 Increases in Collateral Amount.................................................. 35
ARTICLE V. Delivery of Series [200_-_] Notes; Distributions; Reports to Series [200_-_]
Noteholders.............................................................................. 35
Section 5.1 Delivery and Payment for the Series [200_-_] Notes.............................. 35
Section 5.2 Distributions................................................................... 35
Section 5.3 Reports and Statements to Series [200_-_] Noteholders........................... 36
ARTICLE VI. Series [200_-_] Early Amortization Events................................................ 37
Section 6.1 Series [200_-_] Early Amortization Events....................................... 37
ARTICLE VII. Redemption of Series [200_-_] Notes; Final Distributions; Series Termination............. 38
Section 7.1 Optional Redemption of Series [200_-_] Notes; Final Distributions............... 38
Section 7.2 Series Termination.............................................................. 39
ARTICLE VIII. Miscellaneous Provisions................................................................. 40
Section 8.1 Ratification of Indenture; Amendments........................................... 40
Section 8.2 Form of Delivery of the Series [200_-_] Notes................................... 40
Section 8.3 Counterparts.................................................................... 40
Section 8.4 GOVERNING LAW................................................................... 40
Section 8.5 Limitation of Liability......................................................... 40
Section 8.6 Rights of the Indenture Trustee................................................. 40
Section 8.7 Additional Provisions........................................................... 40
EXHIBITS
EXHIBIT A-1 FORM OF CLASS A NOTE
EXHIBIT A-2 FORM OF CLASS B NOTE
EXHIBIT A-3 FORM OF CLASS C NOTE
EXHIBIT B FORM OF MONTHLY PAYMENT INSTRUCTIONS AND
NOTIFICATION OF THE INDENTURE TRUSTEE
EXHIBIT C FORM OF MONTHLY NOTEHOLDERS' STATEMENT
EXHIBIT D FORM OF MONTHLY SERVICER'S CERTIFICATE
ii
SERIES [200_-_] INDENTURE SUPPLEMENT, dated as of [_____ __, 200_] (the
"INDENTURE SUPPLEMENT"), between WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE
TRUST, a business trust organized and existing under the laws of the State of
Delaware (herein, the "ISSUER" or the "TRUST"), and BNY MIDWEST TRUST COMPANY, a
[banking] corporation organized and existing under the laws of the State of
[Illinois], not in its individual capacity, but solely as indenture trustee
(herein, together with its successors in the trusts thereunder as provided in
the Master Indenture referred to below, the "INDENTURE TRUSTEE") under the
Master Indenture, dated as of [_______ __, 200_] (the "INDENTURE"), between the
Issuer and the Indenture Trustee (the Indenture, together with this Indenture
Supplement, the "AGREEMENT").
Pursuant to SECTION 2.11 of the Indenture, the Transferor may direct
the Issuer to issue one or more Series of Notes. The Principal Terms of this
Series are set forth in this Indenture Supplement to the Indenture.
ARTICLE I.
CREATION OF THE SERIES [200_-_] NOTES
Section 1.1 DESIGNATION.
(a) There is hereby created and designated a Series of Notes to be
issued pursuant to the Indenture and this Indenture Supplement to be known as
"WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST, SERIES [200_-_]" or the
"SERIES [200_-_] NOTES." The Series [200_-_] Notes shall be issued in three
Classes, known as the "CLASS A SERIES [200_-_] [FLOATING RATE] ASSET BACKED
NOTES," the "CLASS B SERIES [200_-_] [FLOATING RATE] ASSET BACKED NOTES," and
the "CLASS C SERIES [200_-_] [FLOATING RATE] ASSET BACKED NOTES."
(b) Series [200_-_] shall be included in Group One and shall be a
Principal Sharing Series. Series [200_-_] shall be an Excess Allocation Series
with respect to Group One only. Series [200_-_] shall not be subordinated to any
other Series.
ARTICLE II.
DEFINITIONS
Section 2.1 DEFINITIONS.
(a) Whenever used in this Indenture Supplement, the following words and
phrases shall have the following meanings, and the definitions of such terms are
applicable to the singular as well as the plural forms of such terms and the
masculine as well as the feminine and neuter genders of such terms.
"ACCUMULATION SHORTFALL" means (a) for the first Distribution Date
during the Controlled Accumulation Period, zero; and (b) thereafter, for any
Distribution Date during the Controlled Accumulation Period, the excess, if any,
of the Controlled Deposit Amount for the previous Distribution Date over the
amount deposited into the Principal Accumulation Account pursuant to SUBSECTION
4.4(c)(i) for the previous Distribution Date.
"ADDITIONAL INTEREST" means, for any Distribution Date, Class A
Additional Interest, Class B Additional Interest and Class C Additional Interest
for such Distribution Date.
"ADDITIONAL MINIMUM TRANSFEROR AMOUNT" means (a) as of any date of
determination falling in November, December and January of each calendar year,
the product of (i) 2% and (ii) the Aggregate Principal Receivables and (b) as of
any date of determination falling in any other month, zero; PROVIDED that the
amount specified in CLAUSE (a) shall be without duplication with the amount
specified as the "Additional Minimum Transferor Amount" in the Supplements
relating to the Series 1996-VFC Certificates, Series 1996-A Certificates, Series
1996-B Certificates, Series 1999-A Certificates and Series 2001-VFC Certificates
issued by the Certificate Trust (or in any future Indenture Supplement that
specifies such an amount and indicates that such amount is without duplication
of the amount specified in CLAUSE (a)). The Additional Minimum Transferor Amount
is specified pursuant to SECTION 8.7 of this Indenture Supplement as an
additional amount to be considered part of the Minimum Transferor Amount.
"AGGREGATE INVESTOR DEFAULT AMOUNT" means, as to any Monthly Period,
the sum of the Investor Default Amounts in respect of such Monthly Period.
"ALLOCATION PERCENTAGE" means, with respect to any Monthly Period, the
percentage equivalent of a fraction:
(a) the numerator of which shall be equal to:
(i) for Principal Collections during the Revolving
Period and for Finance Charge Collections and Default Amounts
at any time, the Collateral Amount at the end of the last day
of the prior Monthly Period (or, in the case of the Monthly
Period in which the Closing Date occurs, on the Closing Date),
LESS any principal payments or deposits to the Principal
Accumulation Account to be made on the Distribution Date
falling in the Monthly Period for which the Allocation
Percentage is being calculated; or
(ii) for Principal Collections during the Early
Amortization Period and the Controlled Accumulation Period,
the Collateral Amount at the end of the last day of the
Revolving Period, PROVIDED, HOWEVER, that if Series [200_-_]
is paired with a Paired Series and an Early Amortization
Period commences for such Paired Series, the Transferor may,
by written notice to the Indenture Trustee, the Servicer and
the Rating Agencies, but only after (y) satisfying the Rating
Agency Condition and (z) the Transferor shall have delivered
to the Indenture Trustee an Officer's Certificate to the
effect that, based on the facts known to such officer at that
time, in the reasonable belief of the Transferor, such
designation will not cause an Early Amortization Event or an
event that, after the giving of notice or the lapse of time,
would constitute an Early Amortization Event, to occur with
respect to Series [200__-__], designate a different numerator
for such fraction, which numerator shall not be less than the
Collateral Amount as of the last day of the revolving period
for the Paired Series; and
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(b) the denominator of which shall be the greater of (x) the
Aggregate Principal Receivables determined as of the close of business
on the last day of the prior Monthly Period and (y) the sum of the
numerators used to calculate the allocation percentages for allocations
with respect to Finance Charge Collections, Principal Collections or
Default Amounts, as applicable, for all outstanding Series and all
outstanding Series under (and as defined in) the Pooling and Servicing
Agreement (other than any Series represented by the Collateral
Certificate) on such date of determination PROVIDED, that if one or
more Reset Dates occur in a Monthly Period, the Allocation Percentage
for the portion of the Monthly Period falling on and after such Reset
Date and prior to any subsequent Reset Date will be recalculated for
such period as of the close of business on the subject Reset Date.
"AVAILABLE CASH COLLATERAL AMOUNT" means with respect to any Transfer
Date, an amount equal to the lesser of (a) the amount on deposit in the Cash
Collateral Account (before giving effect to any deposit to, or withdrawal from,
the Cash Collateral Account made or to be made with respect to such date) and
(b) the Required Cash Collateral Amount for such Transfer Date.
"AVAILABLE FINANCE CHARGE COLLECTIONS" means, for any Monthly Period,
an amount equal to the sum of (a) the Investor Finance Charge Collections for
such Monthly Period, PLUS (b) the Excess Finance Charge Collections allocated to
Series [200_-_] for such Monthly Period, PLUS (c) Pre-Funding Investment
Proceeds and Principal Accumulation Investment Proceeds, if any, with respect to
the related Transfer Date, PLUS (d) interest and earnings on funds on deposit in
the Reserve Account and Cash Collateral Account which will be deposited into the
Finance Charge Account on the related Transfer Date to be treated as Available
Finance Charge Collections pursuant to SUBSECTIONS 4.10(b) and 4.11(b),
respectively, PLUS (e) amounts, if any, to be withdrawn from the Reserve Account
which will be deposited into the Finance Charge Account on the related Transfer
Date to be treated as Available Finance Charge Collections pursuant to
SUBSECTION 4.10(d).
"AVAILABLE PRINCIPAL COLLECTIONS" means, for any Monthly Period, an
amount equal to the sum of (a) the Investor Principal Collections for such
Monthly Period, MINUS (b) the amount of Reallocated Principal Collections with
respect to such Monthly Period which pursuant to SECTION 4.6 are required to be
applied on the related Distribution Date, PLUS (c) any Shared Principal
Collections with respect to other Principal Sharing Series (including any
amounts on deposit in the Excess Funding Account that are allocated to Series
[200_-_] for application as Shared Principal Collections), PLUS (d) the
aggregate amount to be treated as Available Principal Collections pursuant to
SUBSECTIONS 4.4(a)(v) and (vi) for the related Distribution Date.
"AVAILABLE RESERVE ACCOUNT AMOUNT" means, for any Transfer Date, the
lesser of (a) the amount on deposit in the Reserve Account (after taking into
account any interest and earnings retained in the Reserve Account pursuant to
SUBSECTION 4.10(b) on such date, but before giving effect to any deposit made or
to be made pursuant to SUBSECTION 4.4(a)(viii) to the Reserve Account on such
date) and (b) the Required Reserve Account Amount.
"AVAILABLE SPREAD ACCOUNT AMOUNT" means, for any Transfer Date, an
amount equal to the lesser of (a) the amount on deposit in the Spread Account
(exclusive of Investment Earnings on such date and before giving effect to any
deposit to, or withdrawal from, the Spread Account
3
made or to be made with respect to such date) and (b) the Required Spread
Account Amount, in each case on such Transfer Date.
"BASE RATE" means, for any Monthly Period, the annualized percentage
equivalent of a fraction, the numerator of which is equal to the sum of (a) the
Monthly Interest and (b) the Noteholder Servicing Fee, each with respect to the
related Distribution Date, and the denominator of which is the Collateral Amount
plus amounts on deposit in the Principal Accumulation Account as of the close of
business on the last day of such Monthly Period.
"CASH COLLATERAL ACCOUNT" is defined in SECTION 4.11(a)
"CLASS A ADDITIONAL INTEREST" is defined in SUBSECTION 4.2(a).
"CLASS A DEFICIENCY AMOUNT" is defined in SUBSECTION 4.2(a).
"CLASS A MONTHLY INTEREST" is defined in SUBSECTION 4.2(a).
"CLASS A NOTE INITIAL PRINCIPAL BALANCE" means $[___________].
"CLASS A NOTE INTEREST RATE" means a per annum rate of [__]% [in excess
of LIBOR as determined on the LIBOR Determination Date for the applicable
Distribution Period].
"CLASS A NOTE PRINCIPAL BALANCE" means, on any date of determination,
an amount equal to (a) the Class A Note Initial Principal Balance, MINUS (b) the
aggregate amount of principal payments made to the Class A Noteholders on or
prior to such date.
"CLASS A NOTEHOLDER" means the Person in whose name a Class A Note is
registered in the Note Register.
"CLASS A NOTES" means any one of the Notes executed by the Issuer and
authenticated by or on behalf of the Indenture Trustee, substantially in the
form of EXHIBIT A-1.
"CLASS A REQUIRED AMOUNT" means, for any Distribution Date, an amount
equal to the excess of the amounts described in SUBSECTION 4.4(a)(i) over the
sum of (a) Available Finance Charge Collections applied to pay such amount
pursuant to SUBSECTION 4.4(a) and (b) any amount withdrawn from the Cash
Collateral Account and applied to pay such amount pursuant to SUBSECTION
4.11(c).
"CLASS B ADDITIONAL INTEREST" is defined in SUBSECTION 4.2(b).
"CLASS B DEFICIENCY AMOUNT" is defined in SUBSECTION 4.2(b).
"CLASS B MONTHLY INTEREST" is defined in SUBSECTION 4.2(b).
"CLASS B NOTE INITIAL PRINCIPAL BALANCE" means $[__________].
"CLASS B NOTE INTEREST RATE" means a per annum rate of [___]% [in
excess of LIBOR as determined on the LIBOR Determination Date for the applicable
Distribution Period].
4
"CLASS B NOTE PRINCIPAL BALANCE" means, on any date of determination,
an amount equal to (a) the Class B Note Initial Principal Balance, MINUS (b) the
aggregate amount of principal payments made to the Class B Noteholders on or
prior to such date.
"CLASS B NOTEHOLDER" means the Person in whose name a Class B Note is
registered in the Note Register.
"CLASS B NOTES" means any one of the Notes executed by the Issuer and
authenticated by or on behalf of the Indenture Trustee, substantially in the
form of EXHIBIT A-2.
"CLASS B REQUIRED AMOUNT" means, for any Distribution Date, an amount
equal to the excess of the amount described in SUBSECTION 4.4(a)(ii) over the
sum of (a) Available Finance Charge Collections applied to pay such amount
pursuant to SUBSECTION 4.4(a) and (b) any amount withdrawn from the Cash
Collateral Account and applied to pay such amount pursuant to SUBSECTION
4.11(c).
"CLASS C ADDITIONAL INTEREST" is defined in SUBSECTION 4.2(c).
"CLASS C COLLATERAL AMOUNT" means, with respect to any Transfer Date,
an amount equal to the excess of (a) the Collateral Amount, over (b) the sum of
the Class A Note Principal Balance and the Class B Note Principal Balance, in
each case on that Transfer Date, but after giving effect to any reductions to
occur on that Transfer Date or on the related Distribution Date.
"CLASS C DEFICIENCY AMOUNT" is defined in SUBSECTION 4.2(c).
"CLASS C MONTHLY INTEREST" is defined in SUBSECTION 4.2(c).
"CLASS C NOTE INITIAL PRINCIPAL BALANCE" means $[____________].
"CLASS C NOTE INTEREST RATE" means a per annum rate of [__]% [in excess
of LIBOR as determined on the LIBOR Determination Date for the applicable
Distribution Period].
"CLASS C NOTE PRINCIPAL BALANCE" means, on any date of determination,
an amount equal to (a) the Class C Note Initial Principal Balance, MINUS (b) the
aggregate amount of principal payments made to the Class C Noteholders on or
prior to such date.
"CLASS C NOTEHOLDER" means the Person in whose name a Class C Note is
registered in the Note Register.
"CLASS C NOTES" means any one of the Notes executed by the Issuer and
authenticated by or on behalf of the Indenture Trustee, substantially in the
form of EXHIBIT A-3.
"CLOSING DATE" means [_______ __, 200_].
"COLLATERAL AMOUNT" means, as of any date of determination, an amount
equal to the result of (a) the Initial Collateral Amount, MINUS (b) the amount
of principal previously paid to the Series [200_-_] Noteholders (other than any
principal payments made from funds on deposit in the Spread Account), MINUS (c)
the balance on deposit in the Principal Accumulation Account,
5
MINUS (d) the aggregate reductions to the Collateral Amount made pursuant to
SECTION 4.4(c)(v) on or prior to such date of determination, MINUS (e) the
excess, if any, of the aggregate amount of Investor Charge-Offs and
Reallocated Principal Collections OVER the reimbursements of such amounts
pursuant to SUBSECTION 4.4(a)(vi) prior to such date.
"CONTROLLED ACCUMULATION AMOUNT" means, for any Transfer Date with
respect to the Controlled Accumulation Period, $[_________]; PROVIDED, HOWEVER,
that if the Controlled Accumulation Period Length is determined to be less than
12 months pursuant to SECTION 4.14 or 4.15, the Controlled Accumulation Amount
for each Distribution Date with respect to the Controlled Accumulation Period
will be equal to (i) the initial Note Principal Balance DIVIDED BY (ii) the
Controlled Accumulation Period Length; PROVIDED, FURTHER, that the Controlled
Accumulation Amount for any Distribution Date shall not exceed the Note
Principal Balance minus any amount already on deposit in the Principal
Accumulation Account on such Transfer Date.
"CONTROLLED ACCUMULATION PERIOD" means, unless an Early Amortization
Event shall have occurred prior thereto, the period commencing at the opening of
business on [_______ __, 200_] or such later date as is determined in accordance
with SECTIONS 4.14 and 4.15, and ending on the first to occur of (a) the
commencement of the Early Amortization Period and (b) the Series Termination
Date.
"CONTROLLED ACCUMULATION PERIOD LENGTH" is defined in SUBSECTION 4.14.
"CONTROLLED DEPOSIT AMOUNT" means, for any Transfer Date with respect
to the Controlled Accumulation Period, an amount equal to the sum of the
Controlled Accumulation Amount for such Transfer Date and any existing
Accumulation Shortfall.
"COVERED AMOUNT" means an amount, determined as of each Transfer Date
for any Distribution Period, equal to the sum of (a) the product of (i) a
fraction, the numerator of which is the actual number of days in such
Distribution Period and the denominator of which is 360, TIMES (ii) the Class A
Note Interest Rate in effect with respect to such Distribution Period, TIMES
(iii) the aggregate amount on deposit in the Principal Accumulation Account, up
to the Class A Note Principal Balance as of the Record Date preceding such
Transfer Date, PLUS (b) the product of (i) a fraction, the numerator of which is
the actual number of days in such Distribution Period and the denominator of
which is 360, TIMES (ii) the Class B Note Interest Rate in effect with respect
to such Distribution Period, TIMES (iii) the aggregate amount on deposit in the
Principal Accumulation Account in excess of the Class A Note Principal Balance
as of the Record Date preceding such Transfer Date, up to the Class B Note
Principal Balance as of the Record Date preceding such Transfer Date, PLUS (c)
the product of (i) a fraction, the numerator of which is the actual number of
days in such Distribution Period and the denominator of which is 360, TIMES (ii)
the Class C Note Interest Rate in effect with respect to such Distribution
Period, TIMES (iii) the aggregate amount on deposit in the Principal
Accumulation Account in excess of the sum of the Class A Note Principal Balance
PLUS the Class B Note Principal Balance, each as of the Record Date preceding
such Transfer Date, up to the Class C Note Principal Balance as of the Record
Date preceding such Transfer Date.
6
"DEFAULT AMOUNT" means, as to any Defaulted Account, the amount of
Principal Receivables (other than Ineligible Receivables, unless there is an
Insolvency Event with respect to WFN or the Transferor) in such Defaulted
Account on the day it became a Defaulted Account.
"DEFAULTED ACCOUNT" means an Account in which there are Defaulted
Receivables.
"DILUTION" means any downward adjustment made by Servicer in the amount
of any Receivable (a) because of a rebate, refund, unauthorized charge,
fraudulent or counterfeit charge or billing error to an accountholder, (b)
because such Receivable was created in respect of merchandise which was refused
or returned by an accountholder or (c) for any other reason other than receiving
Collections therefor or charging off such amount as uncollectible.
"DISTRIBUTION ACCOUNT" is defined in SUBSECTION 4.9(a).
"DISTRIBUTION DATE" means [_______, 200__] and the 15th day of each
calendar month thereafter, or if such 15th day is not a Business Day, the next
succeeding Business Day.
"DISTRIBUTION PERIOD" means, for any Distribution Date, the period from
and including the Distribution Date immediately preceding such Distribution Date
(or, in the case of the first Distribution Date, from and including the Closing
Date) to but excluding such Distribution Date.
"EARLY AMORTIZATION PERIOD" means the period commencing on the date on
which a Trust Early Amortization Event or a Series 200-__-__ Early Amortization
Event is deemed to occur and ending on the Series Termination Date.
"EXCESS SPREAD PERCENTAGE" means, for any Monthly Period, a percentage
equal to the Portfolio Yield for such Monthly Period, MINUS the Base Rate for
such Monthly Period; PROVIDED, HOWEVER, such amount may never be less than zero.
"EXPECTED PRINCIPAL PAYMENT DATE" means the [________ __, 200_]
Distribution Date.
"FINANCE CHARGE ACCOUNT" is defined in SECTION 4.9(a).
"FINANCE CHARGE COLLECTIONS" means Collections of Finance Charge
Receivables.
"FINANCE CHARGE SHORTFALL" is defined in SECTION 4.7.
"FUNDING PERIOD" means, the period commencing on the Closing Date and
ending upon the first to occur of (x) the commencement of the Early Amortization
Period, (y) the date on which the Collateral Amount equals the Note Principal
Balance and (z) [___________], 200[__].
"GROUP ONE" means Series [200_-_], the outstanding Series under (and as
defined in) the Pooling and Servicing Agreement (other than Series represented
by the Collateral Certificate) and each other Series hereafter specified in the
related Indenture Supplement to be included in Group One.
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"INITIAL COLLATERAL AMOUNT" means, as of any date of determination,
$[____________], plus the amount of any increases in the Collateral Amount
during the Funding Period pursuant to Section 4.18 on or prior to such date.
"INITIAL PRE-FUNDED AMOUNT" means $[____________].
"INVESTMENT EARNINGS" means, for any Distribution Date, all interest
and earnings on Eligible Investments included in the Spread Account (net of
losses and investment expenses) during the period commencing on and including
the Distribution Date immediately preceding such Distribution Date and ending on
but excluding such Distribution Date.
"INVESTOR CHARGE-OFFS" is defined in SECTION 4.5.
"INVESTOR DEFAULT AMOUNT" means, with respect to any Defaulted Account,
an amount equal to the product of (a) the Default Amount and (b) the Allocation
Percentage on the day such Account became a Defaulted Account.
"INVESTOR FINANCE CHARGE COLLECTIONS" means, for any Monthly Period, an
amount equal to the aggregate amount of Finance Charge Collections (including
Net Recoveries treated as Finance Charge Collections) retained or deposited in
the Finance Charge Account for Series [200_-_] pursuant to SUBSECTION 4.1(b)(i)
for such Monthly Period.
"INVESTOR PRINCIPAL COLLECTIONS" means, for any Monthly Period, an
amount equal to the aggregate amount of Principal Collections retained or
deposited in the Principal Account for Series [200_-_] pursuant to SUBSECTION
4.1(b)(ii) for such Monthly Period.
"INVESTOR UNCOVERED DILUTION AMOUNT" means an amount equal to the
product of (x) the Series Allocation Percentage for the related Monthly Period
(determined on a weighted average basis, if a Reset Date occurs during that
Monthly Period), TIMES (y) the aggregate Dilutions occurring during that Monthly
Period as to which any deposit is required to be made to the Excess Funding
Account pursuant to SECTION 3.9(a) of the Transfer and Servicing Agreement or
SECTION 3.9(a) of the Pooling and Servicing Agreement but has not been made,
PROVIDED that, if the Transferor Amount is greater than zero at the time the
deposit referred to in CLAUSE (y) is required to be made, the Investor Uncovered
Dilution Amount for such amount to be deposited shall be deemed to be zero.
["LIBOR" means, for any Distribution Period, the London interbank
offered rate for one-month United States dollar deposits determined by the
Indenture Trustee for each Distribution Period in accordance with the provisions
of SECTION 4.16.]
["LIBOR DETERMINATION DATE" means (i) [_______ __, 200_] for the period
from and including the Closing Date through and including [_______ __, 200_] and
(ii) the second London Business Day prior to the commencement of the second and
each subsequent Distribution Period.]
["LONDON BUSINESS DAY" means any day on which dealings in deposits in
United States dollars are transacted in the London interbank market.]
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"MONTHLY INTEREST" means, for any Distribution Date, the sum of the
Class A Monthly Interest, the Class B Monthly Interest, and the Class C Monthly
Interest for such Distribution Date.
"MONTHLY PERIOD" means the period from and including the first day of
the calendar month preceding a related Distribution Date to and including the
last day of such calendar month; PROVIDED that the Monthly Period related to the
[______ 200_] Distribution Date shall mean the period from and including the
Closing Date to and including the last day of [________ 200_].
"MONTHLY PRINCIPAL" is defined in SECTION 4.3.
"MONTHLY PRINCIPAL REALLOCATION AMOUNT" means, for any Monthly Period,
an amount equal to the sum of:
(a) the lower of (i) the Class A Required Amount and (ii) the
greater of (A)(x) the product of (I) [___]% and (II) the Initial
Collateral Amount MINUS (y) the amount of unreimbursed Investor
Charge-Offs (after giving effect to Investor Charge-Offs for the
related Monthly Period) and unreimbursed Reallocated Principal
Collections (as of the previous Distribution Date) and (B) zero; and
(b) the lower of (i) the sum of the Class B Required Amount
and the Servicing Fee Required Amount and (ii) the greater of (A)(x)
the product of (I) [__]% and (II) the Initial Collateral Amount MINUS
(y) the amount of unreimbursed Investor Charge-Offs (after giving
effect to Investor Charge-Offs for the related Monthly Period) and
unreimbursed Reallocated Principal Collections (as of the previous
Distribution Date and as required in CLAUSE (a) above) and (B) zero.
"NOTE PRINCIPAL BALANCE" means, on any date of determination, an amount
equal to the sum of the Class A Note Principal Balance, the Class B Note
Principal Balance and the Class C Note Principal Balance.
"NOTEHOLDER SERVICING FEE" is defined in SECTION 3.1.
"PAIRED SERIES" means a Series that has been paired with Series 2001-A
(which Series may be prefunded or partially prefunded or may be a Variable
Interest) such that a reduction of the Collateral Amount results in (or permits)
an increase of the Collateral Amount of the Paired Series.
"PERCENTAGE ALLOCATION" is defined in SUBSECTION 4.1(b)(ii)(y).
"PORTFOLIO ADJUSTED YIELD" means, with respect to any Transfer Date,
the average of the percentages obtained for each of the three preceding Monthly
Periods by subtracting the Base Rate from the Portfolio Yield for such Monthly
Period and deducting 0.50% from the result for each Monthly Period.
"PORTFOLIO YIELD" means, for any Monthly Period, the annualized
percentage equivalent of a fraction, (a) the numerator of which is equal to (i)
the Available Finance Charge Collections
9
(excluding any Excess Finance Charge Collections), MINUS (ii) the Aggregate
Investor Default Amount and the Uncovered Dilution Amount for such Monthly
Period and (b) the denominator of which is the Collateral Amount plus amounts
on deposit in Principal Accumulation Account as of the close of business on
the last day of such Monthly Period.
"PRE-FUNDED AMOUNT" means, as of any date of determination, the amount
on deposit in the Pre-Funding Account (net of all interest and other investment
income).
"PRE-FUNDED ACCOUNT" is defined in SUBSECTION 4.17(a).
"PRE-FUNDING INVESTMENT PROCEEDS" means, with respect to each Transfer
Date, the investment earnings on funds in the Pre-Funding Account (net of
investment expenses and losses) for the period from and including the
immediately preceding Transfer Date (or, in the case of the first Transfer Date,
from and including the Closing Date) to but excluding such Transfer Date.
"PRINCIPAL ACCOUNT" is defined in Section 4.9(a).
"PRINCIPAL ACCUMULATION ACCOUNT" is defined in SUBSECTION 4.9(a).
"PRINCIPAL ACCUMULATION ACCOUNT BALANCE" means, for any date of
determination, the principal amount, if any, on deposit in the Principal
Accumulation Account on such date of determination.
"PRINCIPAL ACCUMULATION INVESTMENT PROCEEDS" means, with respect to
each Transfer Date, the investment earnings on funds in the Principal
Accumulation Account (net of investment expenses and losses) for the period from
and including the immediately preceding Transfer Date to but excluding such
Transfer Date.
"PRINCIPAL COLLECTIONS" means Collections of Principal Receivables.
"PRINCIPAL SHORTFALL" is defined in SUBSECTION 4.8.
"QUALIFIED MATURITY AGREEMENT" means an agreement whereby an Eligible
Institution agrees to make a deposit into the Principal Accumulation Account on
the Expected Principal Payment Date in an amount equal to the initial Note
Principal Balance.
"QUARTERLY EXCESS SPREAD PERCENTAGE" means (a) with respect to the
[________ 200_] Distribution Date, the Excess Spread Percentage for such
Distribution Date, (b) with respect to the [________ 200_] Distribution Date,
the percentage equivalent of a fraction the numerator of which is the sum of (i)
the Excess Spread Percentage for the [________ 200_] Distribution Date and (ii)
the Excess Spread Percentage with respect to the [________ 200_] Distribution
Date and the denominator of which is two, (c) with respect to the [________
200_] Distribution Date, the percentage equivalent of a fraction the numerator
of which is the sum of (i) the Excess Spread Percentage for the [________ 200_]
Distribution Date (ii) the Excess Spread Percentage with respect to the
[________ 200_] Distribution Date and (iii) the Excess Spread Percentage with
respect to the [________ 200_] Distribution Date and the denominator of which is
three and (d) with respect to the [________ 200_] Distribution Date and each
Distribution Date thereafter, the
10
percentage equivalent of a fraction the numerator of which is the sum of the
Excess Spread Percentages determined with respect to such Distribution Date
and the immediately preceding two Distribution Dates and the denominator of
which is three.
"RATING AGENCY" means each of Fitch, ▇▇▇▇▇'▇ and Standard & Poor's.
"REALLOCATED PRINCIPAL COLLECTIONS" means, for any Transfer Date,
Investor Principal Collections applied in accordance with SECTION 4.6 in an
amount not to exceed the Monthly Principal Reallocation Amount for the related
Monthly Period.
"REASSIGNMENT AMOUNT" means, for any Transfer Date, after giving effect
to any deposits and distributions otherwise to be made on the related
Distribution Date, the sum of (i) the Note Principal Balance on the related
Distribution Date, PLUS (ii) Monthly Interest for the related Distribution Date
and any Monthly Interest previously due but not distributed to the Series
[200_-_] Noteholders, PLUS (iii) the amount of Additional Interest, if any, for
the related Distribution Date and any Additional Interest previously due but not
distributed to the Series [200_-_] Noteholders on a prior Distribution Date.
"REFERENCE BANKS" means four major banks in the London interbank market
selected by the Servicer.
"REQUIRED CASH COLLATERAL AMOUNT" means, for any Transfer Date, the
excess (if any) of the Required Enhancement Amount, over the Class C Collateral
Amount, in each case for that Transfer Date, but after giving effect to any
reductions to occur on that Transfer Date or on the related Distribution Date.
"REQUIRED DRAW AMOUNT" is defined in SUBSECTION 4.11(c).
"REQUIRED ENHANCEMENT AMOUNT" means, for any Transfer Date, the greater
of (a) an amount equal to [__]% of the Note Principal Balance on such Transfer
Date, after taking into account payments to be made on the related Distribution
Date and (b) $[__________]; PROVIDED that in no event shall the Required
Enhancement Amount exceed the Note Principal Balance, less any amounts on
deposit in the Principal Accumulation Account, each as of the last day of the
Monthly Period preceding such Transfer Date after taking into account deposits
into the Principal Accumulation Account on such Transfer Date and the payments
to be made on the related Distribution Date; and PROVIDED, FURTHER the Required
Cash Collateral Amount may be reduced or increased at Transferor's option at any
time if Indenture Trustee has been provided evidence that the Rating Agency
Condition has been satisfied.
"REQUIRED RESERVE ACCOUNT AMOUNT" means, for any Transfer Date on or
after the Reserve Account Funding Date, an amount equal to (a) [__]% of the Note
Principal Balance or (b) any other amount designated by the Transferor;
PROVIDED, HOWEVER, that if such designation is of a lesser amount, the
Transferor shall (i) provide the Servicer and the Indenture Trustee with
evidence that the Rating Agency Condition shall have been satisfied and (ii)
deliver to the Indenture Trustee a certificate of an Authorized Officer to the
effect that, based on the facts known to such officer at such time, in the
reasonable belief of the Transferor, such designation will not cause an Early
Amortization Event or an event that, after the giving of notice or the
11
lapse of time, would cause an Early Amortization Event to occur with respect
to Series [200__-__].
"REQUIRED RETAINED TRANSFER PERCENTAGE" means, for purposes of
[Series 200_-_], [__]%.
"REQUIRED SPREAD ACCOUNT AMOUNT" means, for any Distribution Date, (a)
the product of (i) the Spread Account Percentage in effect on such date and (ii)
during (x) the Revolving Period or the Controlled Accumulation Period, the
Collateral Amount, and (y) during the Early Amortization Period, the Collateral
Amount as of the last day before the beginning of the Early Amortization Period,
LESS amounts on deposit in the Cash Collateral Account on such date (after
taking into account any deposits to made into or withdrawals from the Cash
Collateral Account on such date); PROVIDED, that in no event will the Required
Spread Account Amount exceed the Class C Note Principal Balance (after taking
into account any payments to be made on such Distribution Date).
"RESERVE ACCOUNT" is defined in SUBSECTION 4.10(a).
"RESERVE ACCOUNT FUNDING DATE" means the Transfer Date designated by
the Servicer which occurs not later than the earliest of (a) the Transfer Date
with respect to the Monthly Period which commences 3 months prior to the
commencement of the Controlled Accumulation Period (which commencement shall be
subject to postponement pursuant to SECTION 4.15); (b) the first Transfer Date
for which the Portfolio Adjusted Yield is less than 2%, but in such event the
Reserve Account Funding Date shall not be required to occur earlier than the
Transfer Date with respect to the Monthly Period which commences 12 months prior
to the commencement of the Controlled Accumulation Period; (c) the first
Transfer Date for which the Portfolio Adjusted Yield is less than 3%, but in
such event the Reserve Account Funding Date shall not be required to occur
earlier than the Transfer Date with respect to the Monthly Period which
commences 6 months prior to the commencement of the Controlled Accumulation
Period; and (d) the first Transfer Date for which the Portfolio Adjusted Yield
is less than 4%, but in such event the Reserve Account Funding Date shall not be
required to occur earlier than the Transfer Date with respect to the Monthly
Period which commences 4 months prior to the commencement of the Controlled
Accumulation Period; PROVIDED, HOWEVER, that subject to satisfaction of the
Rating Agency Condition, the Reserve Account Funding Date may be any date
selected by the Servicer.
"RESERVE ACCOUNT SURPLUS" means, as of any Transfer Date following the
Reserve Account Funding Date, the amount, if any, by which the amount on deposit
in the Reserve Account exceeds the Required Reserve Account Amount.
"RESERVE DRAW AMOUNT" means, with respect to each Transfer Date
relating to the Controlled Accumulation Period or the first Transfer Date
relating to the Early Amortization Period, the amount, if any, by which the
Principal Accumulation Investment Proceeds for such Distribution Date are less
than the Covered Amount determined as of such Transfer Date.
"RESET DATE" means:
(a) each Addition Date and each "Addition Date" (as such
term is defined in the Pooling and Servicing Agreement);
12
(b) each Removal Date and each "Removal Date" (as such term is
defined in the Pooling and Servicing Agreement) on which, if any Series
of Notes or any Series under (and as defined in) the Pooling and
Servicing Agreement has been paid in full, Principal Receivables equal
to the Initial Collateral Amount for that Series are removed from the
Receivables Trust;
(c) each date on which there is an increase in the outstanding
balance of any Variable Interest or "Variable Interest" (as such term
is defined in the Pooling and Servicing Agreement); and
(d) each date on which a new Series or Class of Notes is
issued and each date on which a new "Series" or "Class" (each as
defined in the Pooling and Servicing Agreement) of investor
certificates is issued by the Certificate Trust.
"REVOLVING PERIOD" means the period beginning on the Closing Date and
ending at the close of business on the day immediately preceding the earlier of
the day the Controlled Accumulation Period commences or the day the Early
Amortization Period commences.
"SERIES [200_-_]" means the Series of Notes the terms of which are
specified in this Indenture Supplement.
"SERIES [200_-_] EARLY AMORTIZATION EVENT" is defined in SECTION 6.1.
"SERIES [200_-_] FINAL MATURITY DATE" means the [___________ 200_]
Distribution Date.
"SERIES [200_-_] NOTE" means a Class A Note, a Class B Note or a Class
C Note.
"SERIES [200_-_] NOTEHOLDER" means a Class A Noteholder, a Class B
Noteholder or a Class C Noteholder.
"SERIES ALLOCATION PERCENTAGE" means, with respect to any Monthly
Period, the percentage equivalent of a fraction, the numerator of which is the
numerator used in determining the Allocation Percentage for Finance Charge
Collections for that Monthly Period and the denominator of which is the sum of
the numerators used in determining the Allocation Percentage for Finance Charge
Receivables for all outstanding Series on such date of determination; PROVIDED
that if one or more Reset Dates occur in a Monthly Period, the Series Allocation
Percentage for the portion of the Monthly Period falling on and after each such
Reset Date and prior to any subsequent Reset Date will be determined using a
denominator which is equal to the sum of the numerators used in determining the
Allocation Percentage for Finance Charge Receivables for all outstanding Series
as of the close of business on the subject Reset Date.
"SERIES SERVICING FEE PERCENTAGE" means 2% PER ANNUM.
"SERIES TERMINATION DATE" means the earliest to occur of (a) the date
on which the Note Principal Balance is paid in full, (b) the date on which the
Collateral Amount is reduced to zero and (c) the Series [200_-_] Final Maturity
Date.
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"SERVICING FEE REQUIRED AMOUNT" means, for any Distribution Date, an
amount equal to the excess of the amount described in SUBSECTION 4.4(a)(iii)
over the (a) Available Finance Charge Collections applied to pay such amount
pursuant to SUBSECTION 4.4(a) and (b) any amount withdrawn from the Cash
Collateral Account and applied to pay such amount pursuant to SUBSECTION
4.11(c).
"SPREAD ACCOUNT" is defined in SUBSECTION 4.12(a).
"SPREAD ACCOUNT DEFICIENCY" means the excess, if any, of the Required
Spread Account Amount over the Available Spread Account Amount.
"SPREAD ACCOUNT PERCENTAGE" means, (i) [__]% if the Quarterly Excess
Spread Percentage on such Distribution Date is greater than or equal to [__]%,
(ii) [__]% if the Quarterly Excess Spread Percentage on such Distribution Date
is less than [__]% and greater than or equal to [__]%, (iii) [__]% if the
Quarterly Excess Spread Percentage on such Distribution Date is less than [__]%
and greater than or equal [__]%, (iv) [__]% if the Quarterly Excess Spread
Percentage on such Distribution Date is less than [__]% and greater than or
equal to [__]%, (v) [__]% if the Quarterly Excess Spread Percentage on such
Distribution Date is less than [__]% and greater than or equal to [__]%, (vi)
[__]% if the Quarterly Excess Spread Percentage on such Distribution Date is
less than [__]% and greater than or equal to [__]%, (vii) [__]% if the Quarterly
Excess Spread Percentage on such Distribution Date is less than [__]% and
greater than or equal to [__]%, and (viii) [__]% if the Quarterly Excess Spread
Percentage on such Distribution Date is less than [__]%; PROVIDED, that if an
Early Amortization Event is deemed to occur, the Spread Account Percentage shall
be [__]%.
"TARGET AMOUNT" is defined in SUBSECTION 4.1(b)(i).
"TELERATE PAGE 3750" means the display page currently so designated on
the Bridge Telerate Markets Report (or such page as may replace that page in
that service for the purpose of displaying comparable rates or prices).
"UNCOVERED DILUTION AMOUNT" means an amount equal to the product of (x)
the Series Allocation Percentage for the related Monthly Period (determined on a
weighted average basis, if a Reset Date occurs during that Monthly Period),
TIMES (y) the aggregate Dilutions occurring during that Monthly Period as to
which any deposit is required to be made to the Excess Funding Account pursuant
to SECTION 3.9(a) of the Transfer and Servicing Agreement or SECTION 3.9(a) of
the Pooling and Servicing Agreement but has not been made; PROVIDED that, if the
Transferor Amount is greater than zero at the time the deposit referred to in
clause (y) is required to be made, the Uncovered Dilution Amount for such amount
to be deposited shall be deemed to be zero.
(b) Each capitalized term defined herein shall relate to the Series
[200_-_] Notes and no other Series of Notes issued by the Trust, unless the
context otherwise requires. All capitalized terms used herein and not otherwise
defined herein have the meanings ascribed to them in Annex A to the Master
Indenture.
(c) The interpretive rules specified in SECTION 1.2 of the Master
Indenture also apply to this Indenture Supplement. If any term or provision
contained herein shall conflict with or be
14
inconsistent with any term or provision contained in the Master Indenture,
the terms and provisions of this Indenture Supplement shall be controlling.
ARTICLE III.
NOTEHOLDER SERVICING FEE
Section 3.1 SERVICING COMPENSATION. The share of the Servicing Fee
allocable to Series [200_-_] for any Transfer Date (the "NOTEHOLDER SERVICING
FEE") shall be equal to one-twelfth of the product of (a) the Series Servicing
Fee Percentage and (b) the Collateral Amount as of the last day of the Monthly
Period preceding such Transfer Date; PROVIDED, HOWEVER, that with respect to the
first Transfer Date, the Noteholder Servicing Fee shall be equal to
[$_____________]. The remainder of the Servicing Fee shall be paid by the
holders of the Transferor Interest or the noteholders of other Series (as
provided in the related Indenture Supplements) and in no event shall the Trust,
the Indenture Trustee or the Series [200_-_] Noteholders be liable for the share
of the Servicing Fee to be paid by the holders of the Transferor Interest or the
noteholders of any other Series.
ARTICLE IV.
RIGHTS OF SERIES [200_-_] NOTEHOLDERS AND ALLOCATION AND
APPLICATION OF COLLECTIONS
Section 4.1 COLLECTIONS AND ALLOCATIONS
(a) ALLOCATIONS. Finance Charge Collections, Principal Collections and
Defaulted Receivables allocated to Series [200_-_] pursuant to ARTICLE VIII of
the Indenture shall be allocated and distributed as set forth in this Article.
(b) ALLOCATIONS TO THE SERIES [200_-_] NOTEHOLDERS. The
Servicer shall on the Date of Processing, allocate to the Series [200_-_]
Noteholders the following amounts as set forth below:
(i) ALLOCATIONS OF FINANCE CHARGE COLLECTIONS. The Servicer
shall allocate to the Series [200_-_] Noteholders an amount equal to
the product of (A) the Allocation Percentage and (B) the aggregate
Finance Charge Collections processed on such Date of Processing and
shall deposit such amount into the Finance Charge Account, PROVIDED
that, so long as, with respect to each Monthly Period falling in the
Revolving Period (and with respect to that portion of each Monthly
Period in the Controlled Accumulation Period falling on or after the
day on which Collections of Principal Receivables equal to the related
Controlled Deposit Amount have been allocated pursuant to SECTION
4.1(b)(ii) and deposited pursuant to SECTION 4.1(c)), Collections of
Finance Charge Receivables shall be transferred into the Finance Charge
Account only until such time as the aggregate amount so deposited
equals the sum (the "TARGET AMOUNT") of (A) the amounts to be deposited
in the Distribution Account pursuant to SECTIONS 4.4(a)(i), (ii), and
(iv) for distribution on the related Distribution Date, (B) if WFN is
not the Servicer, the Noteholder Servicing Fee (and if WFN is the
Servicer, then amounts that otherwise would have been transferred into
the Finance Charge Account pursuant to this CLAUSE (B) shall instead by
returned to WFN as payment of the Noteholder Servicing Fee), and (C)
15
any amount required to be deposited in the Reserve Account, the Spread
Account and the Cash Collateral Account on the related Transfer Date;
PROVIDED FURTHER, that, notwithstanding the preceding proviso, if on
any Business Day the Servicer determines that the Target Amount for a
Monthly Period exceeds the Target Amount for that Monthly Period as
previously calculated by Servicer, then (x) Servicer shall (on the same
Business Day) inform Transferor of such determination, and (y) within
two Business Days of receiving such notice Transferor shall deposit
into the Finance Charge Account funds in an amount equal to the amount
of Collections of Finance Charge Receivables allocated to the
Noteholders for that Monthly Period but not deposited into the Finance
Charge Account due to the operation of the preceding proviso (but not
in excess of the amount required so that the aggregate amount deposited
for the subject Monthly Period equals the Target Amount); and PROVIDED,
FURTHER, if on any Transfer Date the Transferor Amount is less than the
Specified Transferor Amount after giving effect to all transfers and
deposits on that Transfer Date, Transferor shall, on that Transfer
Date, deposit into the Principal Account funds in an amount equal to
the amounts of Available Finance Charge Collections that are required
to be treated as Available Principal Collections pursuant to SECTION
4.4(a)(v) and (vi) but are not available from funds in the Finance
Charge Account as a result of the operation of second preceding
proviso.
With respect to any Monthly Period when deposits of Collections of
Finance Charge Receivables into the Finance Charge Account are limited to
deposits up to the Target Amount in accordance with CLAUSE (i) above,
notwithstanding such limitation: (1) "REALLOCATED PRINCIPAL COLLECTIONS" for the
related Transfer Date shall be calculated as if the full amount of Finance
Charge Collections allocated to the Noteholders during that Monthly Period had
been deposited in the Finance Charge Account and applied on such Transfer Date
in accordance with SECTION 4.4(a); and (2) Collections of Finance Charge
Receivables released to Transferor pursuant to such SECTION 4.1(b)(i) shall be
deemed, for purposes of all calculations under this Indenture Supplement, to
have been applied to the items specified in SECTIONS 4.4(a) to which such
amounts would have been applied (and in the priority in which they would have
been applied) had such amounts been available in the Finance Charge Account on
such Transfer Date. To avoid doubt, the calculations referred to in the
preceding CLAUSE (2) include the calculations required by CLAUSE (f) of the
definition of Collateral Amount and by the definitions of Class A Required
Amount and Class B Required Amount.
(ii) ALLOCATIONS OF PRINCIPAL COLLECTIONS. The Servicer shall
allocate to the Series [200_-_] Noteholders the following amounts as
set forth below:
(x) ALLOCATIONS DURING THE REVOLVING PERIOD.
(1) During the Revolving Period an amount equal to
the product of the Allocation Percentage and the aggregate
amount of Principal Collections processed on such Date of
Processing, shall be allocated to the Series [200_-_]
Noteholders and first, if any other Principal Sharing Series
is outstanding and in its accumulation period or amortization
period, retained in the Principal Account for application, to
the extent necessary, as Shared Principal Collections to other
Principal Sharing Series on the related Distribution Date,
second deposited in the Excess Funding Account to the extent
necessary so that the Transferor Amount is
16
not less than the Specified Transferor Amount and third paid
to the holders of the Transferor Interest.
(2) With respect to each Monthly Period falling in
the Revolving Period, to the extent that Collections of
Principal Receivables allocated to the Series [200__-__]
Noteholders pursuant to this SUBSECTION 4.1(b)(ii) are paid to
Transferor, Transferor shall make an amount equal to the
Reallocated Principal Collections for the related Transfer
Date available on that Transfer Date for application in
accordance with SECTION 4.6.
(y) ALLOCATIONS DURING THE CONTROLLED ACCUMULATION
PERIOD. During the Controlled Accumulation Period an amount
equal to the product of the Allocation Percentage and the
aggregate amount of Principal Collections processed on such
Date of Processing (the product for any such date is
hereinafter referred to as a "PERCENTAGE ALLOCATION") shall be
allocated to the Series [200_-_] Noteholders and transferred
to the Principal Account until applied as provided herein;
PROVIDED, HOWEVER, that if the sum of such Percentage
Allocation and all preceding Percentage Allocations with
respect to the same Monthly Period exceeds the Controlled
Deposit Amount during the Controlled Accumulation Period for
the related Distribution Date, then such excess shall not be
treated as a Percentage Allocation and shall be first, if any
other Principal Sharing Series is outstanding and in its
accumulation period or amortization period, retained in the
Principal Account for application, to the extent necessary, as
Shared Principal Collections to other Principal Sharing Series
on the related Distribution Date, second deposited in the
Excess Funding Account to the extent necessary so that the
Transferor Amount is not less than the Specified Transferor
Amount and third paid to the holders of the Transferor
Interest.
(z) ALLOCATIONS DURING THE EARLY AMORTIZATION PERIOD.
During the Early Amortization Period, an amount equal to the
product of the Allocation Percentage and the aggregate amount
of Principal Collections processed on such Date of Processing
shall be allocated to the [200_-_] Noteholders and transferred
to the Principal Account until applied as provided herein;
PROVIDED, HOWEVER, that after the date on which an amount of
such Principal Collections equal to the Note Principal Balance
has been deposited into the Principal Account such amount
shall be first, if any other Principal Sharing Series is
outstanding and in its accumulation period or amortization
period, retained in the Principal Account for application, to
the extent necessary, as Shared Principal Collections to other
Principal Sharing Series on the related Distribution Date,
second deposited in the Excess Funding Account to the extent
necessary so that the Transferor Amount is not less than the
Specified Transferor Amount and third paid to the holders of
the Transferor Interest.
(c) During any period when Servicer is permitted by SECTION 4.3 of the
Pooling and Servicing Agreement or Section 8.4 of the Indenture to make a single
monthly deposit to the Collection Account, amounts allocated to the Noteholders
pursuant to SECTIONS 4.1(a) and (b) with respect to any Monthly Period need not
be deposited into the Collection Account or any
17
Series Account prior to the related Transfer Date, and, when so deposited,
(x) may be deposited net of any amounts required to be distributed to
Transferor and, if WFN is Servicer, Servicer, and (y) shall be deposited into
the Finance Charge Account (in the case of Collections of Finance Charge
Receivables) and the Principal Account (in the case of Collections of
Principal Receivables (not including any Shared Principal Collections
allocated to Series [200_-_] pursuant to SECTION 4.15 of the Pooling and
Servicing Agreement or SECTION 8.5 of the Indenture)).
(d) On any date, Servicer may withdraw from the Collection Account or
any Series Account any amounts inadvertently deposited in such account that
should have not been so deposited.
Section 4.2 DETERMINATION OF MONTHLY INTEREST.
(a) The amount of monthly interest ("CLASS A MONTHLY INTEREST")
distributable from the Distribution Account with respect to the Class A Notes on
any Distribution Date shall be an amount equal to the product of (i) (A) a
fraction, the numerator of which is the actual number of days in the related
Distribution Period and the denominator of which is 360, times (B) the Class A
Note Interest Rate in effect with respect to the related Distribution Period and
(ii) the Class A Note Principal Balance as of the close of business on the last
day of the preceding Monthly Period (or, with respect to the initial
Distribution Date, the Class A Note Initial Principal Balance); PROVIDED that
Class A Monthly Interest for the first Distribution Period will be
$[__________].
On the Determination Date preceding each Distribution Date, the
Servicer shall determine the excess, if any (the "CLASS A DEFICIENCY AMOUNT"),
of (x) the aggregate amount accrued pursuant to this SECTION 4.2(a) as of the
prior Distribution Date OVER (y) the amount actually transferred from the
Distribution Account for payment of such amount. If the Class A Deficiency
Amount for any Distribution Date is greater than zero, on each subsequent
Distribution Date until such Class A Deficiency Amount is fully paid, an
additional amount ("CLASS A ADDITIONAL INTEREST") equal to the product of (i)
(A) a fraction, the numerator of which is the actual number of days in the
related Distribution Period and the denominator of which is 360, times (B) the
Class A Note Interest Rate in effect with respect to the related Distribution
Period PLUS 2% per annum and (ii) such Class A Deficiency Amount (or the portion
thereof which has not been paid to the Class A Noteholders) shall be payable as
provided herein with respect to the Class A Notes. Notwithstanding anything to
the contrary herein, Class A Additional Interest shall be payable or distributed
to the Class A Noteholders only to the extent permitted by applicable law.
(b) The amount of monthly interest ("CLASS B MONTHLY INTEREST")
distributable from the Distribution Account with respect to the Class B Notes on
any Distribution Date shall be an amount equal to the product of (i) (A) a
fraction, the numerator of which is the actual number of days in the related
Distribution Period and the denominator of which is 360, times (B) the Class B
Note Interest Rate in effect with respect to the related Distribution Period and
(ii) the Class B Note Principal Balance as of the close of business on the
last day of the preceding Monthly Period (or, with respect to the initial
Distribution Date, the Class B Note Initial Principal
18
Balance), PROVIDED that Class B Monthly Interest for the first Distribution
Period will be [$___________].
On the Determination Date preceding each Distribution Date, the
Servicer shall determine the excess, if any (the "CLASS B DEFICIENCY AMOUNT"),
of (x) the aggregate amount accrued pursuant to this SECTION 4.2(b) as of the
prior Distribution Date OVER (y) the amount of funds actually transferred from
the Distribution Account for payment of such amount. If the Class B Deficiency
Amount for any Distribution Date is greater than zero, on each subsequent
Distribution Date until such Class B Deficiency Amount is fully paid, an
additional amount ("CLASS B ADDITIONAL INTEREST") equal to the product of (i)
(A) a fraction, the numerator of which is the actual number of days in the
related Distribution Period and the denominator of which is 360, times (B) the
Class B Note Interest Rate in effect with respect to the related Distribution
Period PLUS 2% per annum and (ii) such Class B Deficiency Amount (or the portion
thereof which has not been paid to the Class B Noteholders) shall be payable as
provided herein with respect to the Class B Notes. Notwithstanding anything to
the contrary herein, Class B Additional Interest shall be payable or distributed
to the Class B Noteholders only to the extent permitted by applicable law.
(c) The amount of monthly interest ("CLASS C MONTHLY INTEREST")
distributable from the Distribution Account with respect to the Class C Notes on
any Distribution Date shall be an amount equal to the product of (i) (A) a
fraction, the numerator of which is the actual number of days in the related
Distribution Period and the denominator of which is 360, times (B) the Class C
Interest Rate in effect with respect to the related Distribution Period and (ii)
the Class C Note Principal Balance as of the close of business on the last day
of the preceding Monthly Period (or, with respect to the initial Distribution
Date, the Class C Note Initial Principal Balance), PROVIDED that Class C Monthly
Interest for the first Distribution Period will be $[__________].
On the Determination Date preceding each Distribution Date, the
Servicer shall determine the excess, if any (the "CLASS C DEFICIENCY AMOUNT"),
of (x) the aggregate amount accrued pursuant to this SECTION 4.2(c) as of the
prior Distribution Date OVER (y) the amount of funds actually transferred from
the Distribution Account for payment of such amount. If the Class C Deficiency
Amount for any Distribution Date is greater than zero, on each subsequent
Distribution Date until such Class C Deficiency Amount is fully paid, an
additional amount ("CLASS C ADDITIONAL INTEREST") equal to the product of (i)
(A) a fraction, the numerator of which is the actual number of days in the
related Distribution Period and the denominator of which is 360, TIMES (B) the
Class C Note Interest Rate in effect with respect to the related Distribution
Period PLUS 2% per annum and (ii) such Class C Deficiency Amount (or the portion
thereof which has not been paid to the Class C Noteholders) shall be payable as
provided herein with respect to the Class C Notes. Notwithstanding anything to
the contrary herein, Class C Additional Interest shall be payable or distributed
to the Class C Noteholders only to the extent permitted by applicable law.
Section 4.3 DETERMINATION OF MONTHLY PRINCIPAL. The amount of monthly
principal to be transferred from the Principal Account with respect to the Notes
on each Transfer Date (the "MONTHLY PRINCIPAL"), beginning with the Transfer
Date in the month following the month in which the Controlled Accumulation
Period or, if earlier, the Early Amortization Period, begins, shall be equal to
the least of (i) the Available Principal Collections on deposit in the Principal
19
Account with respect to such Transfer Date, (ii) for each Transfer Date with
respect to the Controlled Accumulation Period, the Controlled Deposit Amount for
such Transfer Date, (iii) the Collateral Amount (after taking into account any
adjustments to be made on such Distribution Date pursuant to SECTIONS 4.5 and
4.6) prior to any deposit into the Principal Accumulation Account on such
Transfer Date, and (iv) the Note Principal Balance, minus any amount already on
deposit in the Principal Accumulation Account on such Transfer Date.
Section 4.4 APPLICATION OF AVAILABLE FINANCE CHARGE COLLECTIONS AND
AVAILABLE PRINCIPAL COLLECTIONS. On or before each Transfer Date, the Servicer
shall instruct the Indenture Trustee in writing (which writing shall be
substantially in the form of EXHIBIT B) to withdraw and the Indenture Trustee,
acting in accordance with such instructions, shall withdraw on such Transfer
Date or related Distribution Date, as applicable, to the extent of available
funds, the amount required to be withdrawn from the Finance Charge Account, the
Principal Account, the Principal Funding Account and the Distribution Account as
follows:
(a) On each Transfer Date, an amount equal to the Available Finance
Charge Collections with respect to the related Distribution Date will be
distributed or deposited in the following priority:
(i) an amount equal to Class A Monthly Interest for such
Distribution Date, PLUS any Class A Deficiency Amount, PLUS the amount
of any Class A Additional Interest for such Distribution Date, PLUS the
amount of any Class A Additional Interest previously due but not
distributed to Class A Noteholders on a prior Distribution Date, shall
be deposited by the Servicer or Indenture Trustee into the Distribution
Account;
(ii) an amount equal to Class B Monthly Interest for such
Distribution Date, PLUS any Class B Deficiency Amount, PLUS the amount
of any Class B Additional Interest for such Distribution Date, PLUS the
amount of any Class B Additional Interest previously due but not
distributed to Class B Noteholders on a prior Distribution Date, shall
be deposited by the Servicer or Indenture Trustee into the Distribution
Account;
(iii) an amount equal to the Noteholder Servicing Fee for such
Transfer Date, PLUS the amount of any Noteholder Servicing Fee
previously due but not distributed to the Servicer on a prior Transfer
Date, shall be distributed to the Servicer;
(iv) an amount equal to Class C Monthly Interest for such
Distribution Date, PLUS any Class C Deficiency Amount, PLUS the amount
of any Class C Additional Interest for such Distribution Date, PLUS the
amount of any Class C Additional Interest previously due but not
distributed to the Class C Noteholders on a prior Distribution Date
shall be deposited by the Servicer or Indenture Trustee into the
Distribution Account; PROVIDED, HOWEVER, that, in the event that the
sum of Class C Monthly Interest exceeds the amount of Available Finance
Charge Collections available (after giving effect to SUBSECTIONS
4.4(a)(i) through (iii) above) to fund such Class C Monthly Interest
and Class C Additional Interest, a draw will be made from amounts
available for distribution in the Spread Account (at the times and in
the amounts specified in SECTION 4.11) and shall be deposited by the
Indenture Trustee into the Distribution Account for payment to the
Class C Noteholders on such Distribution Date in accordance with this
SUBSECTION 4.4(a)(iv);
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(v) an amount equal to the Aggregate Investor Default Amount
and any Investor Uncovered Dilution Amount for such Distribution Date
shall be treated as a portion of Available Principal Collections for
such Distribution Date and, during the Controlled Accumulation Period
or the Early Amortization Period, deposited into the Principal Account
on the related Transfer Date;
(vi) an amount equal to the sum of the aggregate amount of
Investor Charge-Offs and the amount of Reallocated Principal
Collections which have not been previously reimbursed pursuant to this
SUBSECTION (vi) shall be treated as a portion of Available Principal
Collections for such Distribution Date;
(vii) an amount equal to the excess, if any, of the Required
Cash Collateral Amount OVER the Available Cash Collateral Amount shall
be deposited into the Cash Collateral Account;
(viii) on each Transfer Date from and after the Reserve
Account Funding Date, but prior to the date on which the Reserve
Account terminates as described in SUBSECTION 4.10(f), an amount up to
the excess, if any, of the Required Reserve Account Amount OVER the
Available Reserve Account Amount shall be deposited into the Reserve
Account;
(ix) an amount equal to the amounts required to be deposited
in the Spread Account pursuant to SECTION 4.12(e) shall be deposited
into the Spread Account as provided in SECTION 4.12(e);
(x) the balance, if any, will constitute a portion of Excess
Finance Charge Collections for such Distribution Date and will first be
available for allocation to other Series in Group One.
(b) On each Transfer Date with respect to the Revolving Period, an
amount equal to the Available Principal Collections for the related Monthly
Period shall be treated as Shared Principal Collections and applied in
accordance with SECTION 8.5 of the Indenture.
(c) On each Transfer Date with respect to the Controlled Accumulation
Period or the Early Amortization Period, an amount equal to the Available
Principal Collections for the related Monthly Period shall be distributed or
deposited in the following order of priority:
(i) during the Controlled Accumulation Period, an amount equal
to the Monthly Principal for such Transfer Date shall be deposited into
the Principal Accumulation Account;
(ii) during the Early Amortization Period, an amount equal to
the Monthly Principal for such Transfer Date shall be deposited into
the Distribution Account on such Transfer Date and on each subsequent
Transfer Date for payment to the Class A Noteholders on the related
Distribution Date until the Class A Note Principal Balance has been
paid in full;
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(iii) during the Early Amortization Period, after giving
effect to the distribution referred to in CLAUSE (ii) above, an amount
equal to the Monthly Principal remaining, if any, shall be deposited
into the Distribution Account on such Transfer Date and on each
subsequent Transfer Date for payment to the Class B Noteholders on the
related Distribution Date until the Class B Note Principal Balance has
been paid in full;
(iv) during the Early Amortization Period, after giving effect
to the distributions referred to in CLAUSES (ii) and (iii) above, an
amount equal to the Monthly Principal remaining, if any, shall be
deposited into the Distribution Account on such Transfer Date and on
each subsequent Transfer Date for payment to the Class C Noteholders on
the related Distribution Date until the Class C Note Principal Balance
has been paid in full; and
(v) in the case of each of the Controlled Accumulation Period
and the Early Amortization Period, the balance of such Available
Principal Collections remaining after application in accordance with
CLAUSES (i) through (iv) above shall be treated as Shared Principal
Collections and applied in accordance with SECTION 8.5 of the
Indenture.
(d) On each Distribution Date, the Indenture Trustee shall pay in
accordance with SECTION 5.2 to the Class A Noteholders from the Distribution
Account, the amount deposited into the Distribution Account pursuant to SECTION
4.4(a)(i) on the preceding Transfer Date, to the Class B Noteholders from the
Distribution Account, the amount deposited into the Distribution Account
pursuant to SECTION 4.4(a)(ii) and to the Class C Noteholders from the
Distribution Account, the amount deposited into the Distribution Account
pursuant to SECTION 4.4(a)(iv).
(e) On the earlier to occur of (i) the first Transfer Date with respect
to the Early Amortization Period and (ii) the Transfer Date immediately
preceding the Expected Principal Payment Date, the Indenture Trustee, acting in
accordance with instructions from the Servicer, shall withdraw from the
Principal Accumulation Account and deposit into the Distribution Account for
payment to the Class A Noteholders, the Class B Noteholders and the Class C
Noteholders the amounts deposited into the Principal Accumulation Account
pursuant to SUBSECTION 4.4(c)(i). The Indenture Trustee, acting in accordance
with the instructions of the Servicer, shall in accordance with SECTION 5.2 pay
from the Distribution Account to the Class A Noteholders, the Class B
Noteholders and the Class C Noteholders the amounts deposited on account of such
Noteholders into the Distribution Account pursuant to this SUBSECTION 4.4(e).
Section 4.5 INVESTOR CHARGE-OFFS. On each Determination Date, the
Servicer shall calculate the Investor Default Amount and any Investor Uncovered
Dilution Amount for the related Distribution Date. If, on any Distribution Date,
the sum of the Investor Default Amount and any Investor Uncovered Dilution
Amount for such Distribution Date exceeds the amount of Available Finance Charge
Collections allocated with respect thereto pursuant to SUBSECTION 4.4(a)(v) with
respect to such Distribution Date, the Collateral Amount will be reduced (but
not below zero) by the amount of such excess (such reduction, an "INVESTOR
CHARGE-OFF").
Section 4.6 REALLOCATED PRINCIPAL COLLECTIONS. On each Transfer Date,
the Servicer shall apply, or shall instruct the Indenture Trustee in writing to
apply, Reallocated Principal Collections with respect to that Transfer Date, to
fund any deficiency pursuant to and in the
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priority set forth in SUBSECTIONS 4.4(a)(i), (ii), (iii) and (iv). On each
Transfer Date, the Collateral Amount shall be reduced by the amount of
Reallocated Principal Collections for such Transfer Date.
Section 4.7 EXCESS FINANCE CHARGE COLLECTIONS. Series [200_-_] shall be
an Excess Allocation Series with respect to Group One only. For this purpose,
each outstanding series of certificates issued by World Financial Network Master
Trust (other than series represented by the Collateral Certificate) shall be
deemed to be a Series in Group One. Subject to SECTION 8.6 of the Indenture,
Excess Finance Charge Collections with respect to the Excess Allocation Series
in Group One for any Transfer Date will be allocated to Series [200_-_] in an
amount equal to the product of (x) the aggregate amount of Excess Finance Charge
Collections with respect to all the Excess Allocation Series in Group One for
such Distribution Date and (y) a fraction, the numerator of which is the Finance
Charge Shortfall for Series [200_-_] for such Distribution Date and the
denominator of which is the aggregate amount of Finance Charge Shortfalls for
all the Excess Allocation Series in Group One for such Distribution Date. The
"FINANCE CHARGE SHORTFALL" for Series [200_-_] 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 4.4(a)(i) through (ix) on such Distribution
Date OVER (b) the Available Finance Charge Collections with respect to such
Distribution Date (excluding any portion thereof attributable to Excess Finance
Charge Collections).
Section 4.8 SHARED PRINCIPAL COLLECTIONS. Subject to SECTION 4.4 of the
Pooling and Servicing Agreement and SECTION 8.5 of the Indenture, Shared
Principal Collections allocable to Series [200_-_] on any Transfer Date will be
equal to the product of (x) the aggregate amount of Shared Principal Collections
with respect to all Principal Sharing Series for such Transfer Date and (y) a
fraction, the numerator of which is the Principal Shortfall for Series [200_-_]
for such Transfer Date and the denominator of which is the aggregate amount of
Principal Shortfalls for all the Series which are Principal Sharing Series for
such Transfer Date. For this purpose, each outstanding series of certificates
issued by World Financial Network Master Trust (other than series represented by
the Collateral Certificate) shall be deemed to be a Principal Sharing Series.
The "PRINCIPAL SHORTFALL" for Series [200_-_] will be equal to (a) for any
Transfer Date with respect to the Revolving Period or the Early Amortization
Period, zero, and (b) for any Transfer Date with respect to the Controlled
Accumulation Period, the excess, if any, of the Controlled Deposit Amount with
respect to such Transfer Date OVER the amount of Available Principal Collections
for such Transfer Date (excluding any portion thereof attributable to Shared
Principal Collections).
Section 4.9 CERTAIN SERIES ACCOUNTS.
(a) The Indenture Trustee shall establish and maintain with an Eligible
Institution, which may be the Indenture Trustee in the name of the Trust, on
behalf of the Trust, for the benefit of the Noteholders, four segregated trust
accounts with such Eligible Institution (the "FINANCE CHARGE ACCOUNT", the
"PRINCIPAL ACCOUNT", the "PRINCIPAL ACCUMULATION ACCOUNT" and the "DISTRIBUTION
ACCOUNT"), bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Series [200_-_] Noteholders. The
Indenture Trustee shall possess all right, title and interest in all funds on
deposit from time to time in the Finance Charge Account, the Principal Account,
the Principal Accumulation Account and the Distribution
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Account and in all proceeds thereof. The Finance Charge Account, the
Principal Account, the Principal Accumulation Account and the Distribution
Account shall be under the sole dominion and control of the Indenture Trustee
for the benefit of the Series [200_-_] Noteholders. If at any time the
institution holding the Finance Charge Account, the Principal Account, the
Principal Accumulation Account and the Distribution Account ceases to be an
Eligible Institution, the Transferor shall notify the Indenture Trustee in
writing, and the Indenture Trustee upon being notified (or the Servicer on
its behalf) shall, within ten (10) Business Days, establish a new Finance
Charge Account, a new Principal Account, a new Principal Accumulation Account
and a new Distribution Account meeting the conditions specified above with an
Eligible Institution, and shall transfer any cash or any investments to such
new Finance Charge Account, new Principal Account, new Principal Accumulation
Account and new Distribution Account. The Indenture Trustee, at the written
direction of the Servicer, shall (i) make withdrawals from the Finance Charge
Account, the Principal Account, the Principal Accumulation Account and the
Distribution Account from time to time, in the amounts and for the purposes
set forth in this Indenture Supplement, and (ii) on each Transfer Date (from
and after the commencement of the Controlled Accumulation Period) prior to
the termination of the Principal Accumulation Account, make deposits into the
Principal Accumulation Account in the amounts specified in, and otherwise in
accordance with, SUBSECTION 4.4(c)(i). Indenture Trustee at all times shall
maintain accurate records reflecting each transaction in the Finance Charge
Account, the Principal Account, the Principal Accumulation Account and the
Distribution Account.
(b) Funds on deposit in the Finance Charge Account, the Principal
Account, the Principal Accumulation Account and the Distribution Account, from
time to time shall be invested and reinvested at the direction of the Servicer
by the Indenture Trustee in Eligible Investments that will mature so that such
funds will be available for withdrawal on or prior to the following Transfer
Date.
The Indenture Trustee shall hold such of the Eligible Investments as
consists of instruments, deposit accounts, negotiable documents, money, goods,
letters of credit, and advices of credit in the State of New York and/or
Illinois. The Indenture Trustee shall hold such of the Eligible Investments as
constitutes investment property through a securities intermediary, which
securities intermediary shall agree with the Indenture Trustee that (a) such
investment property shall at all times be credited to a securities account of
the Indenture Trustee, (b) such securities intermediary shall treat the
Indenture Trustee as entitled to exercise the rights that comprise each
financial asset credited to such securities account, (c) all property credited
to such securities account shall be treated as a financial asset, (d) such
securities intermediary shall comply with entitlement orders originated by the
Indenture Trustee without the further consent of any other person or entity, (e)
such securities intermediary will not agree with any person or entity other than
the Indenture Trustee to comply with entitlement orders originated by such other
person or entity, (f) such securities accounts and the property credited thereto
shall not be subject to any lien, security interest or right of set-off in favor
of such securities intermediary or anyone claiming through it (other than the
Indenture Trustee), and (g) such agreement shall be governed by the laws of the
State of New York. Terms used in the preceding sentence that are defined in the
New York UCC and not otherwise defined herein shall have the meaning set forth
in the New York UCC.
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On each Transfer Date with respect to the Controlled Accumulation
Period and on the first Transfer Date with respect to the Early Amortization
Period, the Indenture Trustee, acting at the Servicer's direction given on or
before such Transfer Date, shall transfer from the Principal Accumulation
Account to the Finance Charge Account the Principal Accumulation Investment
Proceeds on deposit in the Principal Accumulation Account for application as
Available Finance Charge Collections in accordance with SECTION 4.4.
Principal Accumulation Investment Proceeds (including reinvested
interest) shall not be considered part of the amounts on deposit in the
Principal Accumulation Account for purposes of this Indenture Supplement.
Section 4.10 RESERVE ACCOUNT.
(a) The Indenture Trustee shall establish and maintain with an Eligible
Institution, which may be the Indenture Trustee in the name of the Trust, on
behalf of the Trust, for the benefit of the Series [200_-_] Noteholders, a
segregated trust account (the "RESERVE ACCOUNT"), bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Series [200_-_] Noteholders. The Indenture Trustee shall possess all right,
title and interest in all funds on deposit from time to time in the Reserve
Account and in all proceeds thereof. The Reserve Account shall be under the sole
dominion and control of the Indenture Trustee for the benefit of the Series
[200_-_] Noteholders. If at any time the institution holding the Reserve Account
ceases to be an Eligible Institution, the Transferor shall notify the Indenture
Trustee, and the Indenture Trustee upon being notified (or the Servicer on its
behalf) shall, within ten (10) Business Days, establish a new Reserve Account
meeting the conditions specified above with an Eligible Institution, and shall
transfer any cash or any investments to such new Reserve Account. The Indenture
Trustee, at the direction of the Servicer, shall (i) make withdrawals from the
Reserve Account from time to time in an amount up to the Available Reserve
Account Amount at such time, for the purposes set forth in this Indenture
Supplement, and (ii) on each Transfer Date (from and after the Reserve Account
Funding Date) prior to termination of the Reserve Account, make a deposit into
the Reserve Account in the amount specified in, and otherwise in accordance
with, SUBSECTION 4.4(a)(viii).
(b) Funds on deposit in the Reserve Account shall be invested at the
written direction of the Servicer by the Indenture Trustee in Eligible
Investments. Funds on deposit in the Reserve Account on any Transfer Date, after
giving effect to any withdrawals from the Reserve Account on such Transfer Date,
shall be invested in such investments that will mature so that such funds will
be available for withdrawal on or prior to the following Transfer Date.
The Indenture Trustee shall hold such of the Eligible Investments as
consists of instruments, deposit accounts, negotiable documents, money, goods,
letters of credit, and advices of credit in the State of New York. The Indenture
Trustee shall hold such of the Eligible Investments as constitutes investment
property through a securities intermediary, which securities intermediary shall
agree with the Indenture Trustee that (a) such investment property shall at all
times be credited to a securities account of the Indenture Trustee, (b) such
securities intermediary shall treat the Indenture Trustee as entitled to
exercise the rights that comprise each financial asset credited to such
securities account, (c) all property credited to such securities account shall
be treated as a financial asset, (d) such securities intermediary shall comply
with
25
entitlement orders originated by the Indenture Trustee without the further
consent of any other person or entity, (e) such securities intermediary will
not agree with any person or entity other than the Indenture Trustee to
comply with entitlement orders originated by such other person or entity, (f)
such securities accounts and the property credited thereto shall not be
subject to any lien, security interest, or right of set-off in favor of such
securities intermediary or anyone claiming through it (other than the
Indenture Trustee), and (g) such agreement shall be governed by the laws of
the State of New York. Terms used in the preceding sentence that are defined
in the New York UCC and not otherwise defined herein shall have the meaning
set forth in the New York UCC.
On each Transfer Date, all interest and earnings (net of losses and
investment expenses) accrued since the preceding Transfer Date on funds on
deposit in the Reserve Account shall be retained in the Reserve Account (to the
extent that the Available Reserve Account Amount is less than the Required
Reserve Account Amount) and the balance, if any, shall be deposited into the
Finance Charge Account and included in Available Finance Charge Collections for
such Transfer Date. For purposes of determining the availability of funds or the
balance in the Reserve Account for any reason under this Indenture Supplement,
except as otherwise provided in the preceding sentence, investment earnings on
such funds shall be deemed not to be available or on deposit.
(c) On or before each Transfer Date with respect to the Controlled
Accumulation Period and on or before the first Transfer Date with respect to the
Early Amortization Period, the Servicer shall calculate the Reserve Draw Amount;
PROVIDED, HOWEVER, that such amount will be reduced to the extent that funds
otherwise would be available for deposit in the Reserve Account under SECTION
4.4(a)(viii) with respect to such Transfer Date.
(d) If for any Transfer Date the Reserve Draw Amount is greater than
zero, the Reserve Draw Amount, up to the Available Reserve Account Amount, shall
be withdrawn from the Reserve Account on such Transfer Date by the Indenture
Trustee (acting in accordance with the written instructions of the Servicer) and
deposited into the Finance Charge Account for application as Available Finance
Charge Collections for such Transfer Date.
(e) If the Reserve Account Surplus on any Transfer Date, after giving
effect to all deposits to and withdrawals from the Reserve Account with respect
to such Transfer Date, is greater than zero, the Indenture Trustee, acting in
accordance with the written instructions of the Servicer, shall withdraw from
the Reserve Account an amount equal to such Reserve Account Surplus and (i)
deposit such amounts in the Spread Account, to the extent that funds on deposit
in the Spread Account are less than the Required Spread Account Amount, and (ii)
distribute any such amounts remaining after application pursuant to SUBSECTION
4.10(e)(i) to the holders of the Transferor Interest.
(f) Upon the earliest to occur of (i) the termination of the Trust
pursuant to ARTICLE VIII of the Trust Agreement, (ii) the first Transfer Date
relating to the Early Amortization Period and (iii) the Transfer Date
immediately preceding the Expected Principal Payment Date, the Indenture
Trustee, acting in accordance with the instructions of the Servicer, after the
prior payment of all amounts owing to the Series [200_-_] Noteholders that are
payable from the Reserve Account as provided herein, shall withdraw from the
Reserve Account all amounts, if
26
any, on deposit in the Reserve Account and (i) deposit such amounts in the
Spread Account, to the extent that funds on deposit in the Spread Account are
less than the Required Spread Account Amount, and (ii) distribute any such
amounts remaining after application pursuant to SUBSECTION 4.10(f)(i) to the
holders of the Transferor Interest. The Reserve Account shall thereafter be
deemed to have terminated for purposes of this Indenture Supplement. Funds on
deposit in the Reserve Account at any time that the Controlled Accumulation
Period is suspended pursuant to SECTION 4.15 shall remain on deposit until
applied in accordance with SUBSECTION 4.10(d), (e) or (f).
Section 4.11 CASH COLLATERAL ACCOUNT.
(a) The Indenture Trustee shall establish and maintain with an Eligible
Institution, which may be the Indenture Trustee in the name of the Trust, on
behalf of the Trust, for the benefit of the Series [200_-_] Noteholders, a
segregated trust account (the "CASH COLLATERAL ACCOUNT"), bearing a designation
clearly indicating that the funds deposited therein are held for the benefit of
the Series [200_-_] Noteholders. The Indenture Trustee shall possess all right,
title and interest in all funds on deposit from time to time in the Cash
Collateral Account and in all proceeds thereof. The Cash Collateral Account
shall be under the sole dominion and control of the Indenture Trustee for the
benefit of the Series [200_-_] Noteholders. If at any time the institution
holding the Cash Collateral Account ceases to be an Eligible Institution, the
Transferor shall notify the Indenture Trustee, and the Indenture Trustee upon
being notified (or the Servicer on its behalf) shall, within ten (10) Business
Days, establish a new Cash Collateral Account meeting the conditions specified
above with an Eligible Institution, and shall transfer any cash or any
investments to such new Cash Collateral Account.
(b) On the Closing Date, Transferor shall deposit [$________] in
immediately available funds into the Cash Collateral Account. Funds on deposit
in the Cash Collateral Account shall be invested at the written direction of the
Servicer by the Indenture Trustee in Eligible Investments. Funds on deposit in
the Cash Collateral Account on any Transfer Date, after giving effect to any
withdrawals from the Cash Collateral Account on such Transfer Date, shall be
invested in such investments that will mature so that such funds will be
available for withdrawal on or prior to the following Transfer Date.
The Indenture Trustee shall hold such of the Eligible Investments as
consists of instruments, deposit accounts, negotiable documents, money, goods,
letters of credit, and advices of credit in the State of New York. The Indenture
Trustee shall hold such of the Eligible Investments as constitutes investment
property through a securities intermediary, which securities intermediary shall
agree with the Indenture Trustee that (a) such investment property shall at all
times be credited to a securities account of the Indenture Trustee, (b) such
securities intermediary shall treat the Indenture Trustee as entitled to
exercise the rights that comprise each financial asset credited to such
securities account, (c) all property credited to such securities account shall
be treated as a financial asset, (d) such securities intermediary shall comply
with entitlement orders originated by the Indenture Trustee without the further
consent of any other person or entity, (e) such securities intermediary will not
agree with any person or entity other than the Indenture Trustee to comply with
entitlement orders originated by such other person or entity, (f) such
securities accounts and the property credited thereto shall not be subject to
any lien, security interest, or right of set-off in favor of such securities
intermediary or anyone
27
claiming through it (other than the Indenture Trustee), and (g) such
agreement shall be governed by the laws of the State of New York. Terms used
in the preceding sentence that are defined in the New York UCC and not
otherwise defined herein shall have the meaning set forth in the New York UCC.
On each Transfer Date, all interest and earnings (net of losses and
investment expenses) accrued since the preceding Transfer Date on funds on
deposit in the Cash Collateral Account shall be retained in the Cash Collateral
Account (to the extent that the Available Cash Collateral Account Amount is less
than the Required Cash Collateral Account Amount) and the balance, if any, shall
be deposited into the Finance Charge Account and included in Available Finance
Charge Collections for such Transfer Date. For purposes of determining the
availability of funds or the balance in the Cash Collateral Account for any
reason under this Indenture Supplement, except as otherwise provided in the
preceding sentence, interest and earnings on such funds shall be deemed not to
be available or on deposit.
(c) On each Determination Date, Servicer shall calculate the amount
(the "REQUIRED DRAW AMOUNT") by which the sum of the amounts required to be
distributed pursuant to SECTIONS 4.4(a)(i) through (iv) with respect to the
related Transfer Date exceeds the amount of Available Finance Charge Collections
with respect to the related Monthly Period. If the Required Draw Amount for any
Transfer Date is greater than zero, Servicer shall give written notice to the
Indenture Trustee of such positive Required Draw Amount on the related
Determination Date. On the related Transfer Date, the Required Draw Amount, if
any, up to the Available Cash Collateral Amount, shall be withdrawn from the
Cash Collateral Account and distributed to fund any deficiency pursuant to
SECTION 4.4(a)(i) through (iv) (in the order of priority set forth in SECTION
4.4(a)).
(d) If, after giving effect to all deposits to and withdrawals from the
Cash Collateral Account with respect to any Transfer Date, the amount on deposit
in the Cash Collateral Account exceeds the Required Cash Collateral Amount, the
Indenture Trustee acting in accordance with the instructions of the Servicer,
shall withdraw an amount equal to such excess from the Cash Collateral Account
and (i) deposit such amounts in the Spread Account, to the extent that funds on
deposit in the Spread Account are less than the Required Spread Account Amount
and (ii) distribute such amounts remaining after application pursuant to
SUBSECTION 4.11(d) to the Transferor.
Section 4.12 SPREAD ACCOUNT.
(a) On or prior to the Closing Date, the Indenture Trustee shall
establish and maintain with an Eligible Institution, which may be the Indenture
Trustee in the name of the Trust, on behalf of the Trust, for the benefit of the
Class C Noteholders and the Transferor, a segregated account (the "SPREAD
ACCOUNT"), bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Class C Noteholders and the Transferor.
Except as otherwise provided in this SECTION 4.12, the Indenture Trustee shall
possess all right, title and interest in all funds on deposit from time to time
in the Spread Account and in all proceeds thereof. The Spread Account shall be
under the sole dominion and control of the Indenture Trustee for the benefit of
the Class C Noteholders and the holder of the Transferor Interest. If at any
time the institution holding the Spread Account ceases to be an Eligible
Institution, the
28
Servicer shall notify the Indenture Trustee in writing, and the Indenture
Trustee upon being notified (or the Servicer on its behalf) shall, within ten
(10) Business Days (or such longer period as to which the Rating Agencies may
consent) establish a new Spread Account meeting the conditions specified
above with an Eligible Institution and shall transfer any cash or any
investments to such new Spread Account. The Indenture Trustee, at the written
direction of the Servicer, shall (i) make withdrawals from the Spread Account
from time to time in an amount up to the Available Spread Account Amount at
such time, for the purposes set forth in this Indenture Supplement, and (ii)
on each Transfer Date prior to termination of the Spread Account, make a
deposit into the Spread Account in the amount specified in, and otherwise in
accordance with, SUBSECTION 4.12(e).
(b) Funds on deposit in the Spread Account shall be invested at the
written direction of the Servicer by the Indenture Trustee in Eligible
Investments. Funds on deposit in the Spread Account on any Transfer Date, after
giving effect to any withdrawals from and deposits to the Spread Account on such
Transfer Date, shall be invested in such investments that will mature so that
such funds will be available for withdrawal on or prior to the following
Transfer Date.
The Indenture Trustee shall hold such of the Eligible Investments as
consists of instruments, deposit accounts, negotiable documents, money, goods,
letters of credit, and advices of credit in the State of New York. The Indenture
Trustee shall hold such of the Eligible Investments as constitutes investment
property through a securities intermediary, which securities intermediary shall
agree with the Indenture Trustee that (a) such investment property shall at all
times be credited to a securities account of the Indenture Trustee, (b) such
securities intermediary shall treat the Indenture Trustee as entitled to
exercise the rights that comprise each financial asset credited to such
securities account, (c) all property credited to such securities account shall
be treated as a financial asset, (d) such securities intermediary shall comply
with entitlement orders originated by the Indenture Trustee without the further
consent of any other person or entity, (e) such securities intermediary will not
agree with any person or entity other than the Indenture Trustee to comply with
entitlement orders originated by such other person or entity, (f) such
securities accounts and the property credited thereto shall not be subject to
any lien, security interest, or right of set-off in favor of such securities
intermediary or anyone claiming through it (other than the Indenture Trustee),
and (g) such agreement shall be governed by the laws of the State of New York.
Terms used in the preceding sentence that are defined in the New York UCC and
not otherwise defined herein shall have the meaning set forth in the New York
UCC. Except as permitted by this SUBSECTION 4.12(b), the Indenture Trustee shall
not hold Eligible Investments through an agent or a nominee.
On each Transfer Date (but subject to SUBSECTION 4.12(c)), the
Investment Earnings, if any, accrued since the preceding Transfer Date on funds
on deposit in the Spread Account shall be paid to the holders of the Transferor
Interest by the Indenture Trustee upon written direction of the Servicer. For
purposes of determining the availability of funds or the balance in the Spread
Account for any reason under this Indenture Supplement (subject to SUBSECTION
4.12(c)), all Investment Earnings shall be deemed not to be available or on
deposit; PROVIDED that after the maturity of the Series [200_-_] Notes has been
accelerated as a result of an Event of Default, all Investment Earnings shall be
added to the balance on deposit in the Spread Account and treated like the rest
of the Available Spread Account Amount.
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(c) If, on any Transfer Date, the aggregate amount available for
distribution pursuant to SUBSECTION 4.4(a)(iv) is less than the aggregate amount
required to be distributed pursuant to SUBSECTION 4.4(a)(iv) (without giving
effect to any limitation based on Available Finance Charge Collections), the
Indenture Trustee, at the written direction of the Servicer, shall withdraw from
the Spread Account the amount of such deficiency up to the Available Spread
Account Amount and, if the Available Spread Account Amount is less than such
deficiency, Investment Earnings credited to the Spread Account, and deposit such
amount in the Distribution Account for payment to the Class C Noteholders in
respect of interest on the Class C Notes.
(d) On the earlier of Series [200_-_] Final Maturity Date and the date
on which the Class A Note Principal Balance and the Class B Note Principal
Balance have been paid in full, after applying any funds on deposit in the
Spread Account as described in SECTION 4.12(c), the Indenture Trustee at the
written direction of the Servicer shall withdraw from the Spread Account an
amount equal to the lesser of (i) the Class C Note Principal Balance (after any
payments to be made pursuant to SUBSECTION 4.4(c) on such date) and (ii) the
Available Spread Account Amount and, if the Available Spread Account Amount is
not sufficient to reduce the Class C Note Principal Balance to zero, Investment
Earnings credited to the Spread Account up to the amount required to reduce the
Class C Note Principal Balance to zero, and the Indenture Trustee upon the
written direction of the Servicer or the Servicer shall deposit such amounts
into the Collection Account for distribution to the Class C Noteholders in
accordance with SUBSECTION 5.2(e).
(e) On any day following the occurrence of an Event of Default with
respect to Series [200__-__] and acceleration of the maturity of the Series
[200__-__] Notes pursuant to SECTION 5.3 of the Indenture, Servicer shall
withdraw from the Spread Account an amount equal to the Available Spread Account
Amount and Indenture Trustee or Servicer shall deposit such amounts into the
Distribution Account for distribution to the Class C Noteholders, the Class A
Noteholders and the Class B Noteholders, in that order of priority, in
accordance with SECTION 5.2, to fund any shortfalls in amounts owed to such
Noteholders.
(f) If on any Transfer Date, after giving effect to all withdrawals
from the Spread Account, the Available Spread Account Amount is less than the
Required Spread Account Amount then in effect, Available Finance Charge
Collections shall be deposited into the Spread Account pursuant to SUBSECTION
4.4(a)(ix) up to the amount of the Spread Account Deficiency.
(g) If, after giving effect to all deposits to and withdrawls from the
Spread Account with respect to any Transfer Date, the amount on deposit in the
Spread Account exceeds the Required Spread Account Amount, the Indenture Trustee
acting in accordance with the instructions of the Servicer, shall withdraw an
amount equal to such excess from the Spread Account and distribute such amount
to the Transferor. On the date on which the Class C Note Principal Balance has
been paid in full, after making any payments to the Noteholders required
pursuant to SUBSECTIONS 4.12(c), (d) and (e), the Indenture Trustee, at the
written direction of Servicer, shall withdraw from the Spread Account all
amounts then remaining in the Spread Account and pay such amounts to the holders
of the Transferor Interest.
Section 4.13 INVESTMENT INSTRUCTIONS. Any investment instructions
required to be given to the Indenture Trustee pursuant to the terms hereof must
be given to the Indenture Trustee no
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later than 11:00 a.m., New York City time, on the date such investment is to
be made. In the event the Indenture Trustee receives such investment
instruction later than such time, the Indenture Trustee may, but shall have
no obligation to, make such investment. In the event the Indenture Trustee is
unable to make an investment required in an investment instruction received
by the Indenture Trustee after 11:00 a.m., New York City time, on such day,
such investment shall be made by the Indenture Trustee on the next succeeding
Business Day. In no event shall the Indenture Trustee be liable for any
investment not made pursuant to investment instructions received after 11:00
a.m., New York City time, on the day such investment is requested to be made.
Section 4.14 CONTROLLED ACCUMULATION PERIOD. The Controlled
Accumulation Period is scheduled to commence at the beginning of business on
[______ __, 200_]; PROVIDED that if the Controlled Accumulation Period Length
(determined as described below) on any Determination Date on or after the
[_______ 200_] Determination Date is less than 12 months, upon written notice to
the Indenture Trustee, Transferor and, each Rating Agency, Servicer, at its
option, may elect to modify the date on which the Controlled Accumulation Period
actually commences to the first Business Day of the month that is the number of
whole months prior to the month in which the Expected Principal Payment Date
occurs at least equal to the Controlled Accumulation Period Length (so that, as
a result of such election, the number of Monthly Periods in the Controlled
Accumulation Period will at least equal the Controlled Accumulation Period
Length); PROVIDED that (i) the length of the Controlled Accumulation Period will
not be less than two months, (ii) such determination of the Controlled
Accumulation Period Length shall be made on each Determination Date on and after
the [_____ 200_] Determination Date but prior to the commencement of the
Controlled Accumulation Period, and any election to shorten the Controlled
Accumulation Period shall be subject to the subsequent lengthening of the
Controlled Accumulation Period to the Controlled Accumulation Period Length
determined on any subsequent Determination Date, but the Controlled Accumulation
Period shall in no event commence prior to the Controlled Accumulation Date, and
(iii) notwithstanding any other provision of this Indenture Supplement to the
contrary, no election to postpone the commencement of the Controlled
Accumulation Period shall be made after an Early Amortization Event shall have
occurred and be continuing with respect to any other Series. The "CONTROLLED
ACCUMULATION PERIOD LENGTH" will mean a number of whole months such that the
amount available for distribution of principal on the Notes on the Expected
Principal Payment Date is expected to equal or exceed the Note Principal
Balance, assuming for this purpose that (1) the payment rate with respect to
Principal Collections remains constant at the lowest level of such payment rate
during the twelve preceding Monthly Periods (or such lower payment rate as
Servicer may select), (2) the total amount of Principal Receivables in the Trust
(and the principal amount on deposit in the Excess Funding Account, if any)
remains constant at the level on such date of determination, (3) no Early
Amortization Event with respect to any Series will subsequently occur and (4) no
additional Series (other than any Series being issued on such date of
determination) will be subsequently issued. Any notice by Servicer electing to
modify the commencement of the Controlled Accumulation Period pursuant to this
SECTION 4.14 shall specify (i) the Controlled Accumulation Period Length, (ii)
the commencement date of the Controlled Accumulation Period and (iii) the
Controlled Accumulation Amount with respect to each Monthly Period during the
Controlled Accumulation Period.
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Section 4.15 SUSPENSION OF CONTROLLED ACCUMULATION PERIOD. (a) The
Servicer may elect to suspend the commencement of the Controlled Accumulation
Period with prior notice to the Rating Agencies. The commencement of the
Controlled Accumulation Period shall be suspended upon delivery by the Servicer
to the Indenture Trustee of (i) an Officer's Certificate stating that the
Servicer has elected to suspend the commencement of the Controlled Accumulation
Period and that all conditions precedent to such suspension set forth in this
SECTION 4.15 have been satisfied, (ii) a copy of an executed Qualified Maturity
Agreement and (iii) an Opinion of Counsel addressed to the Indenture Trustee as
to the due authorization, execution and delivery and the validity and
enforceability of such Qualified Maturity Agreement. The Issuer does hereby
transfer, assign, set-over, and otherwise convey to the Indenture Trustee for
the benefit of the Series [200_-_] Noteholders, without recourse, all of its
rights under any Qualified Maturity Agreement obtained in accordance with this
SECTION 4.15 and all proceeds thereof. Such property shall constitute part of
the Trust Estate for all purposes of the Indenture. The foregoing transfer,
assignment, set-over and conveyance does not constitute and is not intended to
result in a creation or an assumption by the Indenture Trustee or any Noteholder
of any obligation of the Issuer or any other Person in connection with a
Qualified Maturity Agreement or under any agreement or instrument relating
thereto.
The Indenture Trustee hereby acknowledges its acceptance, to the extent
validly transferred, assigned, set-over or otherwise conveyed to the Indenture
Trustee, for the benefit of the Series [200_-_] Noteholders, of all of the
rights previously held by the Issuer under any Qualified Maturity Agreement
obtained by the Issuer and all proceeds thereof, and declares that it shall hold
such rights upon the trust set forth herein and in the Agreement, and subject to
the terms hereof and thereof, for the benefit of the Series [200_-_]
Noteholders.
(b) The Issuer shall cause the provider of each Qualified Maturity
Agreement to deposit into the Principal Accumulation Account on or before the
Expected Principal Payment Date an amount equal to the initial Note Principal
Balance; PROVIDED, HOWEVER, that the Issuer may instead elect to fund all or a
portion of such deposit with the proceeds of the issuance of a new Series or
with the Available Principal Collections with respect to such Transfer Date. The
amount deposited with respect to the Note Principal Balance shall be applied on
the Expected Principal Payment Date pursuant to SUBSECTION 4.4(d) as if the
commencement of the Controlled Accumulation Period had not been suspended.
(c) Each Qualified Maturity Agreement shall terminate at the close of
business on the Expected Principal Payment Date; PROVIDED, HOWEVER, that the
Issuer may terminate a Qualified Maturity Agreement prior to such Distribution
Date, with notice to each Rating Agency, if (i) the Available Reserve Account
Amount equals the Required Reserve Account Amount and (ii) one of the following
events occurs: (A) the Issuer obtains a substitute Qualified Maturity Agreement,
(B) the provider of the Qualified Maturity Agreement ceases to qualify as an
Eligible Institution and the Issuer is unable to obtain a substitute Qualified
Maturity Agreement or (C) an Early Amortization Event occurs. In addition, the
Issuer may terminate a Qualified Maturity Agreement prior to the later of (i)
the date on which the Controlled Accumulation Period was scheduled to begin,
before giving effect to the suspension of the Controlled Accumulation Period,
and (b) the date to which the commencement of the Controlled Accumulation Period
may be postponed pursuant to SECTION 4.14 (as determined on the Determination
Date preceding the date of such termination), in which case the commencement of
the Controlled Accumulation
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Period shall be determined as if the Issuer had not elected to suspend such
commencement. In the event that the provider of a Qualified Maturity
Agreement ceases to qualify as an Eligible Institution, the Issuer shall use
its best efforts to obtain a substitute Qualified Maturity Agreement.
(d) If a Qualified Maturity Agreement is terminated prior to the
earlier of the Expected Principal Payment Date and the commencement of the Early
Amortization Period and the Issuer does not obtain a substitute Qualified
Maturity Agreement, the Controlled Accumulation Period shall commence on the
latest of (i) the last day of the [________, 200_] Monthly Period, (ii) at the
election of the Issuer, the date to which the commencement of the Controlled
Accumulation Period may be postponed pursuant to SECTION 4.14 (as determined on
the date of such termination) and (iii) the first day of the Monthly Period
following the date of such termination.
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Section 4.16 [Determination of LIBOR].
(a) [On each LIBOR Determination Date in respect of an Distribution
Period, the Indenture Trustee shall 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 Distribution Period
Determination Date shall 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 Indenture Trustee shall request the
principal London office of each of the Reference Banks to provide a quotation of
its rate. If at least two (2) such quotations are provided, the rate for that
Distribution Period shall be the arithmetic mean of the quotations. If fewer
than two (2) quotations are provided as requested, the rate for that
Distribution Period 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.
(b) The Class A Note Interest Rate, Class B Note Interest Rate and
Class C Note Interest Rate applicable to the then current and the immediately
preceding Distribution Periods may be obtained by telephoning the Indenture
Trustee at its corporate trust office at [(___) ___-____] or such other
telephone number as shall be designated by the Indenture Trustee for such
purpose by prior written notice by the Indenture Trustee to each Series [200_-_]
Noteholder from time to time.
(c) On each LIBOR Determination Date, the Indenture Trustee shall send
to the Servicer by facsimile transmission, notification of LIBOR for the
following Distribution Period.]
Section 4.17 PRE-FUNDING ACCOUNT.
(a) The Indenture Trustee shall establish and maintain with an Eligible
Institution, which may be the Indenture Trustee, in the name of the Trust, on
behalf of the Trust, for the benefit of the Series [200_-_] Noteholders, a
segregated trust account (the "PRE-FUNDING ACCOUNT"), bearing a designation
clearly indicating that the funds deposited therein are held for the benefit of
the Series [200_-_] Noteholders. The Indenture Trustee shall possess all right,
title and interest in all funds on deposit from time to time in the Pre-Funding
Account and in all proceeds thereof. The Pre-Funding Account shall be under the
sole dominion and control of the Indenture Trustee for the benefit of the Series
[200_-_] Noteholders. If at any time the institution holding the Pre-Funding
Account ceases to be an Eligible Institution, the Transferor shall notify the
Indenture Trustee, and the Indenture Trustee upon being notified (or the
Servicer on its behalf) shall, within ten (10) Business Days, establish a new
Pre-Funding Account meeting the conditions specified above with an Eligible
Institution, and shall transfer any cash or any investments to such new
Pre-Funding Account.
(b) The Transferor shall on the Closing Date deposit into the
Pre-Funding Account the Initial Pre-Funded Amount from the proceeds of the sale
of the Series [200_-_] Notes. On the Business Day preceding each Transfer Date,
the Trustee, acting in accordance with written instructions from the Servicer,
shall withdraw from the Pre-Funding Account and deposit into the
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Collection Account all interest and other investment income on the Pre-Funded
Amount with respect to the prior Monthly Period. Such investment income shall
be deemed to be Finance Charge Collections allocated to Series [200_-_)].
Interest (including reinvested interest) and other investment income on funds
on deposit in the Pre-Funding Account shall not be considered part of the
Pre-Funded Amount for purposes of this Indenture Supplement.
(c) Funds on deposit in the Pre-Funding Account shall be invested at
the written direction of the Servicer by the Indenture Trustee in Eligible
Investments. Funds on deposit in the Pre-Funding Account on the Closing Date and
thereafter shall be invested in Eligible Investments that will mature so that
such funds will be available for withdrawal on or prior to the Business Day next
succeeding the next increase in the Collateral Amount pursuant to SECTION 4.18
or, if earlier, on the next succeeding Transfer Date.
(d) If the Pre-Funded Amount exceeds zero at the end of the Funding
Period, on the first Distribution Date on or after the last day of the Funding
Period the Servicer shall apply or shall cause the Indenture Trustee to apply
the Pre-Funded Amount to the payment by the Indenture Trustee of principal on
the Notes on a pro rata basis based on the Class A Note Principal Balance, the
Class B Note Principal Balance and the Class C Note Principal Balance.
Section 4.18 INCREASES IN COLLATERAL AMOUNT. On each Distribution Date
during the Funding Period, the Collateral Amount shall increase to the extent
that the Transferor Amount will not be less than the Minimum Transferor Amount
on such date (in each case after giving effect to all changes to occur on that
date, including the charge resulting from the operation of this SECTION 4.18);
PROVIDED, HOWEVER, that the Collateral Amount shall in no event exceed the Note
Principal Balance. Upon any increase in the Collateral Amount pursuant to this
SECTION 4.18, Servicer shall instruct Indenture Trustee in writing to withdraw
from the Pre-Funding Account and pay to Transferor no later than the next
succeeding Business Day an amount equal to the amount of such increase in the
Collateral Amount.
ARTICLE V.
DELIVERY OF SERIES [200_-_] NOTES; DISTRIBUTIONS; REPORTS TO
SERIES [200_-_] NOTEHOLDERS
Section 5.1 DELIVERY AND PAYMENT FOR THE SERIES [200_-_] NOTES.
The Issuer shall execute and issue, and the Indenture Trustee shall
authenticate, the Series [200_-_] Notes in accordance with SECTION 2.3 of the
Indenture. The Indenture Trustee shall deliver the Series [200_-_] Notes to or
upon the written order of the Trust when so authenticated.
Section 5.2 DISTRIBUTIONS.
(a) On each Distribution Date, the Indenture Trustee shall distribute
to each Class A Noteholder of record on the related Record Date (other than as
provided in SECTION 11.2 of the Indenture) such Class A Noteholder's PRO RATA
share of the amounts on deposit in the Distribution Account that are allocated
and available on such Distribution Date and as are payable to the Class A
Noteholders pursuant to this Indenture Supplement.
35
(b) On each Distribution Date, the Indenture Trustee shall distribute
to each Class B Noteholder of record on the related Record Date (other than as
provided in SECTION 11.2 of the Indenture) such Class B Noteholder's PRO RATA
share of the amounts on deposit in the Distribution Account that are allocated
and available on such Distribution Date and as are payable to the Class B
Noteholders pursuant to this Indenture Supplement.
(c) On each Distribution Date, the Indenture Trustee shall distribute
to each Class C Noteholder of record on the related Record Date (other than as
provided in SECTION 11.2 of the Indenture) such Class C Noteholder's PRO RATA
share of the amounts on deposit in the Distribution Account (including amounts
withdrawn from the Spread Account (at the times and in the amounts specified in
SECTION 4.12)) that are allocated and available on such Distribution Date and as
are payable to the Class C Noteholders pursuant to this Indenture Supplement.
(d) The distributions to be made pursuant to this SECTION 5.2 are
subject to the provisions of SECTIONS 2.6, 6.1 and 7.1 of the Transfer and
Servicing Agreement, SECTION 11.2 of the Indenture and SECTION 7.1 of this
Indenture Supplement.
(e) Except as provided in SECTION 11.2 of the Indenture with respect to
a final distribution, distributions to [200_-_] Noteholders hereunder shall be
made by (i) check mailed to each Series [200_-_] Noteholder (at such
Noteholder's address as it appears in the Note Register), except that for any
Series [200_-_] Notes registered in the name of the nominee of a Clearing
Agency, such distribution shall be made by wire transfer of immediately
available funds and (ii) without presentation or surrender of any Series
[200_-_] Note or the making of any notation thereon.
Section 5.3 REPORTS AND STATEMENTS TO SERIES [200_-_] NOTEHOLDERS.
(a) On each Distribution Date, the Indenture Trustee shall forward to
each Series [200_-_] Noteholder a statement substantially in the form of EXHIBIT
C prepared by the Servicer.
(b) Not later than the second Business Day preceding each Distribution
Date, the Servicer shall deliver to the Owner Trustee, the Indenture Trustee and
each Rating Agency (i) a statement substantially in the form of EXHIBIT B
prepared by the Servicer and (ii) a certificate of an Authorized Officer
substantially in the form of EXHIBIT D; PROVIDED that the Servicer may amend the
form of EXHIBIT B from time to time, with the prior written consent of the
Indenture Trustee.
(c) A copy of each statement or certificate provided pursuant to
paragraph (a) or (b) may be obtained by any Series [200_-_] Noteholder by a
request in writing to the Servicer.
(d) On or before January 31 of each calendar year, beginning with
January 31, 2002, the Indenture Trustee shall furnish or cause to be furnished
to each Person who at any time during the preceding calendar year was a Series
[200_-_] Noteholder, a statement prepared by the Servicer containing the
information which is required to be contained in the statement to Series
[200_-_] Noteholders, as set forth in paragraph (a) above, aggregated for such
calendar year or the applicable portion thereof during which such Person was a
Series [200_-_] Noteholder, together with other information as is required to be
provided by an issuer of indebtedness under the Code. Such obligation of the
Indenture Trustee shall be deemed to have
36
been satisfied to the extent that substantially comparable information shall
be provided by the Servicer pursuant to any requirements of the Code as from
time to time in effect.
ARTICLE VI.
SERIES [200_-_] EARLY AMORTIZATION EVENTS
Section 6.1 SERIES [200_-_] EARLY AMORTIZATION EVENTS. If any one of
the following events shall occur with respect to the Series [200_-_] Notes:
(a) failure on the part of Transferor or the "Transferor" under the
Pooling and Servicing Agreement (i) to make any payment or deposit required to
be made by it by the terms of the Pooling and Servicing Agreement, the
Collateral Series Supplement, the Transfer and Servicing Agreement, the
Indenture or this Indenture Supplement on or before the date occurring five (5)
Business Days after the date such payment or deposit is required to be made
therein or herein or (ii) duly to observe or perform in any material respect any
other of its covenants or agreements set forth in the Transfer and Servicing
Agreement, the Pooling and Servicing Agreement, the Indenture or this Indenture
Supplement, which failure has a material adverse effect on the Series [200_-_]
Noteholders and which continues unremedied for a period of sixty (60) days after
the date on which written notice of such failure, requiring the same to be
remedied, shall have been given to the Transferor by the Indenture Trustee, or
to the Transferor and the Indenture Trustee by any Holder of the Series [200_-_]
Notes;
(b) any representation or warranty made by Transferor or the
"Transferor" under the Pooling and Servicing Agreement, in the Transfer and
Servicing Agreement or the Pooling and Servicing Agreement or any information
contained in a computer file or microfiche list required to be delivered by it
pursuant to SECTION 2.1 or SUBSECTION 2.6(c) of the Transfer and Servicing
Agreement or SECTION 2.1 or SUBSECTION 2.6(c) of the Pooling and Servicing
Agreement 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 sixty (60) days after the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Transferor by the Indenture Trustee, or to the Transferor and the Indenture
Trustee by any Holder of the Series [200_-_] Notes and as a result of which the
interests of the Series [200_-_] Noteholders are materially and adversely
affected for such period; PROVIDED, HOWEVER, that a Series [200_-_] Early
Amortization Event pursuant to this SUBSECTION 6.1(b) shall not be deemed to
have occurred hereunder if the Transferor has accepted reassignment of the
related Receivable, or all of such Receivables, if applicable, during such
period in accordance with the provisions of the Transfer and Servicing Agreement
or the Pooling and Servicing Agreement;
(c) a failure by Transferor or the "Transferor" under the Pooling and
Servicing Agreement to convey Receivables in Additional Accounts or
Participations to the Receivables Trust within five (5) Business Days after the
day on which it is required to convey such Receivables pursuant to SUBSECTION
2.6(a) of the Transfer and Servicing Agreement or SUBSECTION 2.8(b) of the
Pooling and Servicing Agreement, respectively, PROVIDED that such failure shall
not give rise to an Early Amortization Event if, prior to the date on which such
conveyance was required to be completed, Transferor causes a reduction in the
invested amount of any Variable Interest to occur, so that, after giving effect
to that reduction (i) the Transferor Amount is not less
37
than the Minimum Transferor Amount (including the Additional Minimum
Transferor Amount, if any) and (ii) the sum of the aggregate amount of
Principal Receivables plus amounts on deposit in the Excess Funding Account
is not less than the Required Principal Balance;
(d) any Servicer Default or any "Servicer Default" under the Pooling
and Servicing Agreement shall occur which would have a material adverse effect
on the Series [200_-_] Noteholders;
(e) the Portfolio ▇▇▇▇▇ averaged over three consecutive Monthly Periods
is less than the Base Rate averaged over such period;
(f) the Note Principal Balance shall not be paid in full on the
Expected Principal Payment Date;
(g) without limiting the foregoing, the occurrence of an Event of
Default with respect to Series [200_-_] and acceleration of the maturity of the
Series [200_-_] Notes pursuant to SECTION 5.3 of the Indenture; or
(h) the occurrence of an Early Amortization Event as defined in the
Pooling and Servicing Agreement and specified in SECTION 9.1 of that Agreement;
then, in the case of any event described in SUBSECTION (a), (b) or (d), after
the applicable grace period, if any, set forth in such subparagraphs, either the
Indenture Trustee or the holders of Series [200_-_] Notes evidencing more than
50% of the aggregate unpaid principal amount of Series [200_-_] Notes by notice
then given in writing to the Transferor and the Servicer (and to the Indenture
Trustee if given by the Series [200_-_] Noteholders) may declare that a "Series
Early Amortization Event" with respect to Series [200_-_] (a "SERIES [200_-_]
EARLY AMORTIZATION EVENT") has occurred as of the date of such notice, and, in
the case of any event described in SUBSECTION (c), (e), (f), (g), or (h) a
Series [200_-_] Early Amortization Event shall occur without any notice or other
action on the part of the Indenture Trustee or the Series [200_-_] Noteholders
immediately upon the occurrence of such event.
ARTICLE VII.
REDEMPTION OF SERIES [200_-_] NOTES; FINAL DISTRIBUTIONS;
SERIES TERMINATION
Section 7.1 OPTIONAL REDEMPTION OF SERIES [200_-_] NOTES; FINAL
DISTRIBUTIONS.
(a) On any day occurring on or after the date on which the outstanding
principal balance of the Series [200_-_] Notes is reduced to 5% or less of the
initial outstanding principal balance of Series [200_-_] Notes, the Servicer
shall have the option to redeem the Series [200_-_] Notes, at a purchase price
equal to (i) if such day is a Distribution Date, the Reassignment Amount for
such Distribution Date or (ii) if such day is not a Distribution Date, the
Reassignment Amount for the Distribution Date following such day.
(b) Servicer shall give the Indenture Trustee at least thirty (30) days
prior written notice of the date on which Servicer intends to exercise such
optional redemption. Not later than 12:00 noon, New York City time, on such day
Servicer shall deposit into the Collection Account
38
in immediately available funds the excess of the Reassignment Amount over the
amount, if any, on deposit in the Principal Accumulation Account. Such
redemption option is subject to payment in full of the Reassignment Amount.
Following such deposit into the Collection Account in accordance with the
foregoing, the Collateral Amount for Series [200_-_] shall be reduced to zero
and the Series [200_-_] Noteholders shall have no further security interest
in the Receivables. The Reassignment Amount shall be distributed as set forth
in SUBSECTION 7.1(d).
(c) (i) The amount to be paid by the Transferor with respect to Series
[200_-_] in connection with a reassignment of Receivables to the Transferor
pursuant to SECTION 2.4(e) of the Transfer and Servicing Agreement shall equal
the Reassignment Amount for the first Distribution Date following the Monthly
Period in which the reassignment obligation arises under the Transfer and
Servicing Agreement.
(i) The amount to be paid by the Transferor with respect to
Series [200_-_] in connection with a repurchase of the Notes pursuant
to SECTION 7.1 of the Transfer and Servicing Agreement shall equal the
Reassignment Amount for the Distribution Date of such repurchase.
(d) With respect to (a) the Reassignment Amount deposited into the
Distribution Account pursuant to SECTION 7.1 or (b) the proceeds of any sale of
Receivables pursuant to SECTION 5.5(a)(iii) of the Indenture with respect to
Series [200_-_], the Indenture Trustee shall, in accordance with the written
direction of the Servicer, not later than 12:00 noon, New York City time, on the
related Distribution Date, make distributions of the following amounts (in the
priority set forth below and, in each case, after giving effect to any deposits
and distributions otherwise to be made on such date) in immediately available
funds: (i) (x) the Class A Note Principal Balance on such Distribution Date will
be distributed to the Class A Noteholders and (y) an amount equal to the sum of
(A) Class A Monthly Interest for such Distribution Date, (B) any Class A
Deficiency Amount for such Distribution Date and (C) the amount of Class A
Additional Interest, if any, for such Distribution Date and any Class A
Additional Interest previously due but not distributed to the Class A
Noteholders on any prior Distribution Date, will be distributed to the Class A
Noteholders, (ii) (x) the Class B Note Principal Balance on such Distribution
Date will be distributed to the Class B Noteholders and (y) an amount equal to
the sum of (A) Class B Monthly Interest for such Distribution Date, (B) any
Class B Deficiency Amount for such Distribution Date and (C) the amount of Class
B Additional Interest, if any, for such Distribution Date and any Class B
Additional Interest previously due but not distributed to the Class B
Noteholders on any prior Distribution Date, will be distributed to the Class B
Noteholders, (iii) (x) the Class C Note Principal Balance on such Distribution
Date will be distributed to the Class C Noteholders and (y) an amount equal to
the sum of (A) Class C Monthly Interest for such Distribution Date, (B) any
Class C Deficiency Amount for such Distribution Date, and (C) the amount of
Class C Additional Interest, if any, for such Distribution Date and any Class C
Additional Interest previously due but not distributed to the Class C
Noteholders on any prior Distribution Date will be distributed to the Class C
Noteholders and (iv) any excess shall be released to the Issuer.
Section 7.2 SERIES TERMINATION.
39
On the Series [200_-_] Final Maturity Date, the unpaid principal amount
of the Series [200__-__] Notes shall be due and payable, and the right of the
Series [200_-_] Noteholders to receive payments from the Issuer will be limited
solely to the right to receive payments pursuant to SECTION 5.5 of the
Indenture.
ARTICLE VIII.
MISCELLANEOUS PROVISIONS
Section 8.1 RATIFICATION OF INDENTURE; AMENDMENTS. As supplemented by
this Indenture Supplement, the Indenture is in all respects ratified and
confirmed and the Indenture as so supplemented by this Indenture Supplement
shall be read, taken and construed as one and the same instrument. This
Indenture Supplement may be amended only by a Supplemental Indenture entered in
accordance with the terms of SECTION 10.1 or 10.2 of the Indenture. For purposes
of the application of SECTION 10.2 to any amendment of this Indenture
Supplement, the Series [200_-_] Noteholders shall be the only Noteholders whose
vote shall be required.
Section 8.2 FORM OF DELIVERY OF THE SERIES [200_-_] NOTES. The Class A
Notes, the Class B Notes and the Class C Notes shall be Book-Entry Notes and
shall be delivered as Registered Notes as provided in SECTIONS 2.1 and 2.13 of
the Indenture.
Section 8.3 COUNTERPARTS. This Indenture Supplement may be executed in
two or more counterparts, and by different parties on separate counterparts,
each of which shall be an original, but all of which shall constitute one and
the same instrument.
Section 8.4 GOVERNING LAW. THIS INDENTURE SUPPLEMENT SHALL BE CONSTRUED
IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 8.5 LIMITATION OF LIABILITY. Notwithstanding any other
provision herein or elsewhere, this Agreement has been executed and delivered by
[__________________], not in its individual capacity, but solely in its capacity
as Owner Trustee of the Trust, in no event shall [__________________] in its
individual capacity have any liability in respect of the representations,
warranties, or obligations of the Trust hereunder or under any other document,
as to all of which recourse shall be had solely to the assets of the Trust, and
for all purposes of this Agreement and each other document, the Owner Trustee
(as such or in its individual capacity) shall be subject to, and entitled to the
benefits of, the terms and provisions of the Trust Agreement.
Section 8.6 RIGHTS OF THE INDENTURE TRUSTEE. The Indenture Trustee
shall have herein the same rights, protections, indemnities and immunities as
specified in the Master Indenture.
Section 8.7 ADDITIONAL PROVISIONS. The Additional Minimum Transferor
Amount is hereby specified as an additional amount to be considered part of the
Minimum Transferor Amount pursuant to CLAUSE (b) of the definition of Minimum
Transferor Amount.
40
[SIGNATURE PAGE FOLLOWS]
41
IN WITNESS WHEREOF, the undersigned have caused this Indenture
Supplement to be duly executed and delivered by their respective duly authorized
officers on the day and year first above written.
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST, as Issuer
By: [___________________], not in its
individual capacity, but solely as
Owner Trustee
By: ______________________________
Name:
Title:
BNY MIDWEST TRUST COMPANY, as Indenture
Trustee
By: ______________________________
Name:
Title:
Acknowledged and Accepted:
WORLD FINANCIAL NETWORK NATIONAL BANK,
as Servicer
By: ________________________
Name:
Title:
WFN CREDIT COMPANY, LLC
as Transferor
By: ________________________
Name:
Title
S-1
EXHIBIT A-1
FORM OF CLASS A SERIES [200_-_] [FLOATING RATE] ASSET BACKED NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES
THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT
CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK
("WFNMT"), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR
ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE
TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT,
INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED
STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY
OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION
DOCUMENTS.
THE HOLDER OF THIS CLASS A NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH
HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS A NOTES AS
INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND
FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY,
INCOME.
REGISTERED $__________________.
No. R-___________ CUSIP NO.__________
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES [200_-_]
CLASS A SERIES [200_-_] [FLOATING RATE] ASSET BACKED NOTE
World Financial Network Credit Card Master Note Trust (herein
referred to as the "Issuer" or the "Trust"), a Delaware statutory business
trust governed by a Trust Agreement dated as of ____________ __, 2001, for
value received, hereby promises to pay to Cede & Co., or registered assigns,
subject to the following provisions, the principal sum of ____________
DOLLARS, or such greater or lesser amount as determined in accordance with
the Indenture, on the Series [200_-_]Final Maturity Date (which is the
earlier to occur of (a) the Distribution Date on which the Note Principal
Balance is paid in full and (b) the ____________ __, 200_ Distribution Date),
except as otherwise provided below or in the Indenture. The Issuer will pay
interest on the unpaid principal amount of this Note at the Class A Note
Interest Rate on each Distribution Date until the principal amount of this
Note is paid in full. Interest on this Note will accrue for each Distribution
Date from and including the most recent Distribution Date on which interest
has been paid to but excluding such Distribution Date or, for the initial
Distribution Date, from and including the Closing Date to but excluding such
Distribution Date. Interest will be computed on the basis of a [360-day]year
and the [actual] number of days elapsed. Principal of this Note shall be paid
in the manner specified in the Indenture Supplement referred to on the
reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
Unless the certificate of authentication hereon has been executed by or
on behalf of the Indenture Trustee, by manual signature, this Note shall not be
entitled to any benefit under the Indenture or the Indenture Supplement referred
to on the reverse hereof, or be valid for any purpose.
--------------
* Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
Exhibit A-1 (Page 2)
IN WITNESS WHEREOF, the Issuer has caused this Class A Note to be duly executed.
WORLD FINANCIAL NETWORK CREDIT CARD MASTER
NOTE TRUST,
as Issuer
By: [_________________], not in its
individual capacity but solely as Owner
Trustee under the Trust Agreement
By: ______________________________________
Name: ____________________________________
Title: ___________________________________
Dated:______________________________,
Exhibit A-1 (Page 3)
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A Notes described in the within-mentioned Indenture.
BNY MIDWEST TRUST COMPANY,
as Indenture Trustee
By: ______________________________________
Authorized Signatory
Exhibit A-1 (Page 4)
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES [200_-_]
CLASS A SERIES [200_-_] [FLOATING RATE] ASSET BACKED NOTE
Summary of Terms and Conditions
This Class A Note is one of a duly authorized issue of Notes of the
Issuer, designated as World Financial Network Credit Card Master Note Trust,
Series [200_-_] (the "SERIES [200_-_] NOTES"), issued under a Master Indenture
dated as of ____________ __, 2001 (the "MASTER INDENTURE"), between the Issuer
and BNY Midwest Trust Company, as indenture trustee (the "INDENTURE TRUSTEE"),
as supplemented by the Indenture Supplement dated as of ____________ __, 2001
(the "INDENTURE SUPPLEMENT"), and representing the right to receive certain
payments from the Issuer. The term "Indenture," unless the context otherwise
requires, refers to the Master Indenture as supplemented by the Indenture
Supplement. The Notes are subject to all of the terms of the Indenture. All
terms used in this Note that are defined in the Indenture shall have the
meanings assigned to them in or pursuant to the Indenture. In the event of any
conflict or inconsistency between the Indenture and this Note, the Indenture
shall control.
The Class B Notes and the Class C Notes will also be issued under the
Indenture.
The Noteholder, by its acceptance of this Note, agrees that it will
look solely to the property of the Issuer allocated to the payment of this Note
for payment hereunder and that neither the Owner Trustee nor the Indenture
Trustee is liable to the Noteholders for any amount payable under the Notes or
the Indenture or, except in the case of the Indenture Trustee as expressly
provided in the Indenture, subject to any liability under the Indenture.
This Note does not purport to summarize the Indenture and reference is
made to the Indenture for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Indenture Trustee.
THIS CLASS A NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST
IN, THE ISSUER, WORLD FINANCIAL NETWORK NATIONAL BANK, WFN CREDIT COMPANY, LLC,
OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR
INSTRUMENTALITY.
The Issuer, the Transferor, the Indenture Trustee and any agent of the
Issuer, the Transferor or the Indenture Trustee shall treat the person in whose
name this Class A Note is registered as the owner hereof for all purposes, and
neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the
Issuer, the Transferor or the Indenture Trustee shall be affected by notice to
the contrary.
THIS CLASS A NOTE 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
Exhibit A-1 (Page 5)
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Exhibit A-1 (Page 6)
ASSIGNMENT
Social Security or other identifying number of assignee ___________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto __________________ (name and address of assignee) the within certificate
and all rights thereunder, and hereby irrevocably constitutes and
appoints__________________ attorney, to transfer said certificate on the books
kept for registration thereof, with full power of substitution in the premises.
Dated:___________________________ _________________________________**
Signature Guaranteed:
--------------
** The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.
Exhibit A-1 (Page 7)
EXHIBIT A-2
FORM OF CLASS B SERIES [200_-_] [FLOATING RATE] ASSET BACKED NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES
THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT
CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK
("WFNMT"), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR
ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE
TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT,
INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED
STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY
OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION
DOCUMENTS.
THE HOLDER OF THIS CLASS B NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH
HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS B NOTES AS
INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND
FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY,
INCOME.
Exhibit A-2 (Page 1)
REGISTERED $____________________*
No. R-___________ CUSIP NO.____________
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES [200_-_]
CLASS B SERIES [200_-_] [FLOATING RATE] ASSET BACKED NOTE
World Financial Network Credit Card Master Note Trust (herein referred
to as the "Issuer" or the "Trust"), a Delaware statutory business trust governed
by a Trust Agreement dated as of ____________ __, 2001, for value received,
hereby promises to pay to Cede & Co., or registered assigns, subject to the
following provisions, the principal sum of DOLLARS, or such greater or lesser
amount as determined in accordance with the Indenture, on the Series [200_-_]
Final Maturity Date (which is the earlier to occur of (a) the Distribution Date
on which the Note Principal Balance is paid in full and (b) the ____________ __,
200_ Distribution Date), except as otherwise provided below or in the Indenture.
The Issuer will pay interest on the unpaid principal amount of this Note at the
Class B Note Interest Rate on each Distribution Date until the principal amount
of this Note is paid in full. Interest on this Note will accrue for each
Distribution Date from and including the most recent Distribution Date on which
interest has been paid to but excluding such Distribution Date or, for the
initial Distribution Date, from and including the Closing Date to but excluding
such Distribution Date. Interest will be computed on the basis of a [360-day]
year and the [actual] number of days elapsed. Principal of this Note shall be
paid in the manner specified in the Indenture Supplement referred to on the
reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
Unless the certificate of authentication hereon has been executed by or
on behalf of the Indenture Trustee, by manual signature, this Note shall not be
entitled to any benefit under the Indenture or the Indenture Supplement referred
to on the reverse hereof, or be valid for any purpose.
THIS CLASS B NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND
PAYMENTS ON THE CLASS A NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE
SUPPLEMENT.
--------------
* Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
Exhibit A-2 (Page 2)
IN WITNESS WHEREOF, the Issuer has caused this Class B Note to be duly executed.
WORLD FINANCIAL NETWORK CREDIT CARD MASTER
NOTE TRUST,
as Issuer
By: [_________________], not in its
individual capacity but solely as Owner
Trustee under the Trust Agreement
By: ______________________________________
Name:
Title:
Dated: ____________________,______
Exhibit A-2 (Page 3)
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class B Notes described in the within-mentioned Indenture.
BNY MIDWEST TRUST COMPANY,
as Indenture Trustee
By:________________________________________
Authorized Signatory
Exhibit A-2 (Page 4)
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES 2001-
CLASS B SERIES [200_-_] [FLOATING RATE] ASSET BACKED NOTE
Summary of Terms and Conditions
This Class B Note is one of a duly authorized issue of Notes of the
Issuer, designated as World Financial Network Credit Card Master Note Trust,
Series [200_-_] (the "SERIES [200_-_] NOTES"), issued under a Master Indenture
dated as of ____________ __, 2001 (the "MASTER INDENTURE"), between the Issuer
and BNY Midwest Trust Company, as indenture trustee (the "INDENTURE TRUSTEE"),
as supplemented by the Indenture Supplement dated as of ____________ __, 2001
(the "INDENTURE SUPPLEMENT"), and representing the right to receive certain
payments from the Issuer. The term "Indenture," unless the context otherwise
requires, refers to the Master Indenture as supplemented by the Indenture
Supplement. The Notes are subject to all of the terms of the Indenture. All
terms used in this Note that are defined in the Indenture shall have the
meanings assigned to them in or pursuant to the Indenture. In the event of any
conflict or inconsistency between the Indenture and this Note, the Indenture
shall control.
The Class A Notes and the Class C Notes will also be issued under the
Indenture.
The Noteholder, by its acceptance of this Note, agrees that it will
look solely to the property of the Issuer allocated to the payment of this Note
for payment hereunder and that neither the Owner Trustee nor the Indenture
Trustee is liable to the Noteholders for any amount payable under the Notes or
the Indenture or, except in the case of the Indenture Trustee as expressly
provided in the Indenture, subject to any liability under the Indenture.
This Note does not purport to summarize the Indenture and reference is
made to the Indenture for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Indenture Trustee.
THIS CLASS B NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST
IN, THE ISSUER, WORLD FINANCIAL NETWORK NATIONAL BANK, WFN CREDIT COMPANY, LLC,
OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR
INSTRUMENTALITY.
The Issuer, the Transferor, the Indenture Trustee and any agent of the
Issuer, the Transferor or the Indenture Trustee shall treat the person in whose
name this Class B Note is registered as the owner hereof for all purposes, and
neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the
Issuer, the Transferor or the Indenture Trustee shall be affected by notice to
the contrary.
THIS CLASS B NOTE 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
Exhibit A-2 (Page 5)
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Exhibit A-2 (Page 6)
ASSIGNMENT
Social Security or other identifying number of assignee _______________________.
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto _______________________ (name and address of assignee) the
within certificate and all rights thereunder, and hereby irrevocably
constitutes and appoints _________________________ attorney, to transfer said
certificate on the books kept for registration thereof, with full power of
substitution in the premises.
Dated:___________________________ _________________________________**
Signature Guaranteed:
--------------
** The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration, enlargement or any change whatsoever.
Exhibit A-2 (Page 7)
EXHIBIT A-3
FORM OF CLASS C SERIES [200_-_] [FLOATING RATE] ASSET BACKED NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS
REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO
SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON
IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES
THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT
CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK
("WFNMT"), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR
ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE
TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT,
INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED
STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY
OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION
DOCUMENTS.
THE HOLDER OF THIS CLASS C NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH
HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS C NOTES AS
INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND
FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY,
INCOME.
Exhibit A-3 (Page 1)
REGISTERED $____________________*
No. R-___________ CUSIP NO.____________
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES [200_-_]
CLASS C SERIES [200_-_] [FLOATING RATE] ASSET BACKED NOTE
World Financial Network Credit Card Master Note Trust (herein referred
to as the "Issuer" or the "Trust"), a Delaware statutory business trust governed
by a Trust Agreement dated as of ____________ __, 2001, for value received,
hereby promises to pay to Cede & Co., or registered assigns, subject to the
following provisions, the principal sum of DOLLARS, or such greater or lesser
amount as determined in accordance with the Indenture, on the Series [200_-_]
Final Maturity Date (which is the earlier to occur of (a) the Distribution Date
on which the Note Principal Balance is paid in full and (b) the ____________ __,
200_ Distribution Date), except as otherwise provided below or in the Indenture.
The Issuer will pay interest on the unpaid principal amount of this Note at the
Class C Note Interest Rate on each Distribution Date until the principal amount
of this Note is paid in full. Interest on this Note will accrue for each
Distribution Date from and including the most recent Distribution Date on which
interest has been paid to but excluding such Distribution Date or, for the
initial Distribution Date, from and including the Closing Date to but excluding
such Distribution Date. Interest will be computed on the basis of a [360-day]
year and the [actual] number of days elapsed. Principal of this Note shall be
paid in the manner specified in the Indenture Supplement referred to on the
reverse hereof.
The principal of and interest on this Note are payable in such coin or
currency of the United States of America as at the time of payment is legal
tender for payment of public and private debts.
Reference is made to the further provisions of this Note set forth on
the reverse hereof, which shall have the same effect as though fully set forth
on the face of this Note.
Unless the certificate of authentication hereon has been executed by or
on behalf of the Indenture Trustee, by manual signature, this Note shall not be
entitled to any benefit under the Indenture or the Indenture Supplement referred
to on the reverse hereof, or be valid for any purpose.
THIS CLASS C NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND
PAYMENTS ON THE CLASS A AND CLASS B NOTES TO THE EXTENT SPECIFIED IN THE
INDENTURE SUPPLEMENT.
--------------
* Denominations of $1,000 and integral multiples of $1,000 in excess thereof.
Exhibit A-3 (Page 2)
IN WITNESS WHEREOF, the Issuer has caused this Class C Note to be duly executed.
WORLD FINANCIAL NETWORK CREDIT CARD MASTER
NOTE TRUST,
as Issuer
By: [_________________], not in its
individual capacity but solely as Owner
Trustee under the Trust Agreement
By: ______________________________________
Name:
Title:
Dated: ______________________________,
Exhibit A-3 (Page 3)
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class C Notes described in the within-mentioned Indenture.
BNY MIDWEST TRUST COMPANY,
as Indenture Trustee
By:_______________________________________
Authorized Signatory
Exhibit A-3 (Page 4)
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES [200_-_]
CLASS C SERIES [200_-_] [FLOATING RATE] ASSET BACKED NOTE
Summary of Terms and Conditions
This Class C Note is one of a duly authorized issue of Notes of the
Issuer, designated as World Financial Network Credit Card Master Note Trust,
Series [200_-_] (the "SERIES [200_-_] NOTES"), issued under a Master Indenture
dated as of ____________ __, 2001 (the "MASTER INDENTURE"), between the Issuer
and BNY Midwest Trust Company, as indenture trustee (the "INDENTURE TRUSTEE"),
as supplemented by the Indenture Supplement dated as of ____________ __, 2001
(the "INDENTURE SUPPLEMENT"), and representing the right to receive certain
payments from the Issuer. The term "Indenture," unless the context otherwise
requires, refers to the Master Indenture as supplemented by the Indenture
Supplement. The Notes are subject to all of the terms of the Indenture. All
terms used in this Note that are defined in the Indenture shall have the
meanings assigned to them in or pursuant to the Indenture. In the event of any
conflict or inconsistency between the Indenture and this Note, the Indenture
shall control.
The Class A Notes and the Class B Notes will also be issued under the
Indenture.
The Noteholder, by its acceptance of this Note, agrees that it will
look solely to the property of the Issuer allocated to the payment of this Note
for payment hereunder and that neither the Owner Trustee nor the Indenture
Trustee is liable to the Noteholders for any amount payable under the Notes or
the Indenture or, except in the case of the Indenture Trustee as expressly
provided in the Indenture, subject to any liability under the Indenture.
This Note does not purport to summarize the Indenture and reference is
made to the Indenture for the interests, rights and limitations of rights,
benefits, obligations and duties evidenced thereby, and the rights, duties and
immunities of the Indenture Trustee.
THIS CLASS C NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST
IN, THE ISSUER, WORLD FINANCIAL NETWORK NATIONAL BANK, WFN CREDIT COMPANY LLC,
OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR
INSTRUMENTALITY.
The Issuer, the Transferor, the Indenture Trustee and any agent of the
Issuer, the Transferor or the Indenture Trustee shall treat the person in whose
name this Class C Note is registered as the owner hereof for all purposes, and
neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the
Issuer, the Transferor or the Indenture Trustee shall be affected by notice to
the contrary.
THIS CLASS C NOTE 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
Exhibit A-3 (Page 5)
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Exhibit A-3 (Page 6)
ASSIGNMENT
Social Security or other identifying number of assignee _______________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto _______________________ (name and address of assignee) the
within certificate and all rights thereunder, and hereby irrevocably
constitutes and appoints _______________________ attorney, to transfer said
certificate on the books kept for registration thereof, with full power of
substitution in the premises.
Dated:___________________________ _________________________________**
Signature Guaranteed:
--------------
** The signature to this assignment must correspond with the name of the
registered owner as it appears on the face of the within Note in every
particular, without alteration or any change whatsoever.
Exhibit A-3 (Page 7)
EXHIBIT B
FORM OF MONTHLY PAYMENT INSTRUCTIONS AND
NOTIFICATION TO INDENTURE TRUSTEE
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES [200_-_]
The undersigned, a duly authorized representative of World Financial
Network National Bank ("WFN"), as Servicer pursuant to the Transfer and
Servicing Agreement, dated as of [_____, __, 200_] (the "TRANSFER AND SERVICING
AGREEMENT") between WFN, as Servicer, WFN Credit Company, LLC, as transferor
(the "TRANSFEROR") and World Financial Network Credit Card Master Note Trust, as
issuer (the "ISSUER"), does hereby certify as follows:
A. Capitalized terms used in this Certificate have their
respective meanings set forth in the Master Indenture dated as of
[_____, __, 200_] (the "INDENTURE") between the Issuer and BNY Midwest
Trust Company, as indenture trustee (the "INDENTURE TRUSTEE") as
supplemented by the [200_-_] Indenture Supplement dated as of
[__________ __, 200_] between the Issuer and Indenture Trustee (as
amended and supplemented, the "INDENTURE SUPPLEMENT").
B. WFN is the Servicer.
C. The undersigned is an Authorized Officer of the
Servicer.
I. INSTRUCTION TO MAKE A WITHDRAWAL
Pursuant to SECTION 4.4, the Servicer does hereby instruct the
Indenture Trustee (i) to make a withdrawal from the Distribution Account (or
other Series Account as specified below) on ____________, 200_, which date is a
Distribution Date under the Indenture Supplement, in an aggregate amount (equal
to the Available Finance Charge Collections) as set forth below in respect of
the following amounts and (ii) to apply the proceeds of such withdrawal in
accordance with SECTION 4.4(a):
A. Pursuant to SUBSECTION 4.4(a)(i):
Class A Monthly Interest for the
preceding Interest Period........................ $ _________
Monthly Interest previously due but not
distributed to Class A Noteholders............... $ _________
Additional Interest previously due but not
distributed to Class A Noteholders............... $ _________
Exhibit B-1
B. Pursuant to SUBSECTION 4.4(a)(ii):
Class B Monthly Interest for the
preceding Interest Period........................ $ _________
Monthly Interest previously due but not
distributed to Class B Noteholders............... $ _________
Additional Interest previously due but not
distributed to Class B Noteholders............... $ _________
C. Pursuant to SUBSECTION 4.4(a)(iii):
Noteholder Servicing Fee for such Distribution
Date, PLUS the amount of any Noteholder Servicing
Fee previously due but not distributed to the
Servicer on a prior Distribution Date............ $ _________
▇. ▇▇▇▇▇▇▇▇ to SUBSECTION 4.4(a)(iv):
Class C Monthly Interest for the
preceding Interest Period........................ $ _________
Monthly Interest previously due but not
distributed to Class C Noteholders............... $ _________
Additional Interest previously due but not
distributed to Class C Noteholders............... $ _________
▇. ▇▇▇▇▇▇▇▇ to SUBSECTION 4.4(a)(v) from the
Principal Account:
Investor Default Amount to be treated as
Available Principal Collections.................. $ _________
Investor Uncovered Dilution Amount for such
Distribution Date to be treated as Available
Principal Collections............................ $ _________
F. Pursuant to SUBSECTION 4.4(a)(vi):
Investor Charge Offs and the amount of
Reallocated Principal Collections not previously
reimbursed to be treated as Available Principal
Collections...................................... $ _________
G. Pursuant to SUBSECTION 4.4(a)(vii):
Exhibit B-2
Amount to be deposited into the Cash Collateral
Account.......................................... $ _________
▇. ▇▇▇▇▇▇▇▇ to SUBSECTION 4.4(a)(viii):
Amount to be deposited into the Reserve Account.. $_________
I. Pursuant to SUBSECTION 4.4(a)(ix):
Amount to be deposited
in the Spread Account............................ $ _________
J. Pursuant to SUBSECTION 4.4(a)(x):
The balance, if any, will constitute a portion
of Excess Finance Charge Collections for such
Distribution Date and first will be available
for allocation to other Series in Group One,
second deposited in the Excess Funding Account
to the extent necessary so that the Transferor
Amount is not less than the Specified Transferor
Amount and third paid to the Holders of the
Transferor Interest as described in SECTION 8.6
of the Indenture................................. $ _________
Pursuant to SECTION 4.4(b) and (c), the Servicer does
hereby instruct the Indenture Trustee (i) to make a withdrawal from the
Distribution Account (or other Series Account specified below) on
____________, 200_, which date is a Distribution Date under the Indenture
Supplement, in an aggregate amount (equal to the Available Principal
Collections) as set forth below in respect of the following amounts and (ii)
to apply the proceeds of such withdrawal in accordance with SECTION 4.4(b)
and (c):
A. Pursuant to SUBSECTION 4.4(b):
During the Revolving Period, amount equal to
the Available Principal Collections to be treated
as Shared Principal Collections and applied in
accordance with SECTION 8.5 of the Indenture..... $ _________
B. Pursuant to SUBSECTION 4.4(c)(i):
During the Controlled Accumulation Period,
Monthly Principal for such Distribution Date to
be deposited into the Principal Accumulation
Account.......................................... $ _________
Exhibit B-3
C. Pursuant to SUBSECTION 4.4(c)(ii):
During the Early Amortization Period, Monthly
Principal for such Distribution Date for payment
to the Class A Noteholders on such Distribution
Date until the Class A Note Principal Balance
has been paid in full............................ $ _________
▇. ▇▇▇▇▇▇▇▇ to SUBSECTION 4.4(c)(iii):
During the Early Amortization Period, after
giving effect to Clause (C) above, if any
remaining Monthly Principal, to the Class B
Noteholders on such Distribution Date until
the Class B Note Principal Balance has been
paid in full..................................... $ _________
E. Pursuant to SUBSECTION 4.4(c)(iv):
During the Early Amortization Period, after
giving effect to Clause (D) above, if any
remaining Monthly Principal, to the Class C
Noteholders, on such Distribution Date until the
Class C Note Principal Balance has been paid
in full.......................................... $ _________
F. Pursuant to SUBSECTION 4.4(c)(v):
Amount, if any, remaining after giving effect
to Clauses (B) through (E) above, to be treated
as Shared Principal Collections.................. $ _________
Pursuant to SECTION 4.6, the Servicer does hereby instruct
the Indenture Trustee (i) to make a withdrawal from the Distribution Account
on ____________, 200_, which date is a Distribution Date under the Indenture
Supplement, in an aggregate amount (equal to the Available Principal
Collections) as set forth below in respect of the following amounts and (ii)
to apply the proceeds of such withdrawal in accordance with SECTION 4.6:
Reallocated Principal Collections to fund any
deficiency pursuant to and in the priority set
forth SUBSECTIONS 4.4(a)(i), (ii), (iii) and
(iv) of the Indenture Supplement................. $ _________
Exhibit B-4
Pursuant to SECTION 4.9, the Servicer does hereby instruct
the Indenture Trustee to transfer from the Principal Accumulation Account to
the Collection Account, the Principal Accumulation Investment Proceeds on
deposit in the Principal Accumulation Account for application as Available
Finance Charge Collections in the following amount.
.................................................................... $ _________
Pursuant to SECTION 4.10, the Servicer does hereby instruct
the Indenture Trustee to withdraw from the Reserve Account an amount equal to
any Reserve Account Surplus to be deposited into the Spread Account in
accordance with SECTION 4.10(e), in the following amount.
.................................................................... $ _________
Pursuant to SECTION 4.12, the Servicer does hereby instruct
the Indenture Trustee to withdraw from the Spread Account an amount equal to a
deficiency in Class C Monthly Interest up to the Available Spread Account
Amount, in the following amount.
.................................................................... $ _________
Pursuant to SECTION 4.17 of the Indenture Supplement, the
Servicer hereby instructs the Indenture Trustee (i) to make the following
withdrawal from the Pre-Funding Account and (ii) to apply the proceeds of such
withdrawal in accordance with Section 4.17 of the Indenture Supplement.
(1) Interest and other investment income on the
Pre-Funded Amount................................ $ _________
(2) Pre-Funded Amount, if any, (to be applied to
payment of principal following Funding Period)... $ _________
II. INSTRUCTIONS TO MAKE CERTAIN PAYMENTS
Pursuant to SECTION 5.2, the Servicer does hereby instruct the
Indenture Trustee or the Paying Agent as the case may be, to pay in accordance
with SECTION 5.2 from the Collection Account or the Principal Funding Account,
as applicable, on _______________, which date is a Distribution Date under the
Indenture Supplement, the following amounts:
A. Pursuant to SUBSECTION 5.2(a):
(1) Class A Noteholder's PRO RATA share of the
amounts on deposit in the Distribution Account
that are allocated and available on such
Distribution Date to pay interest on the
Class A Notes pursuant to the Indenture
Supplement....................................... $ _________
Exhibit B-5
(2) Class A Noteholder's PRO RATA share of the
amounts on deposit in the Distribution Account
that are allocated and available on such
Distribution Date to pay principal of the Class A
Notes pursuant to the Indenture Supplement....... $ _________
B. Pursuant to SUBSECTION 5.2(b):
(1) Class B Noteholder's PRO RATA share of the
amounts on deposit in the Distribution Account
that are allocated and available on such
Distribution Date to pay interest on the
Class B Notes pursuant to the Indenture
Supplement....................................... $ _________
(2) Class B Noteholder's PRO RATA share of the
amounts on deposit in the Distribution Account
that are allocated and available on such
Distribution Date to pay principal of the
Class B Notes pursuant to the Indenture
Supplement....................................... $ _________
C. Pursuant to SUBSECTION 5.2(c):
(1) Class C Noteholder's PRO RATA share of the
amounts on deposit in the Distribution Account
that are allocated and available on such
Distribution Date to pay interest of the
Class C Notes pursuant to the Indenture
Supplement, including amounts withdrawn from
the Spread Account............................... $ _________
(2) Class C Noteholder's PRO RATA share of the
amounts on deposit in the Distribution Account
that are allocated and available on such
Distribution Date to pay principal on the
Class C Notes pursuant to the Indenture
Supplement....................................... $ _________
Exhibit B-6
IN WITNESS WHEREOF, the undersigned has duly executed this certificate
this ___________ day of ________________, 2000_.
WORLD FINANCIAL NETWORK NATIONAL
BANK, as Servicer
By: ____________________________________
Name:
Title:
EXHIBIT C
FORM OF MONTHLY NOTEHOLDERS' STATEMENT
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES [200_-_]
Pursuant to the Master Indenture, dated as of [200_-_], (as
amended and supplemented, the "INDENTURE") between World Financial Network
Credit Card Master Note Trust (the "ISSUER") and BNY Midwest Trust Company, as
indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the Series
[200_-_] Indenture Supplement (the "INDENTURE SUPPLEMENT"), dated as of
[200_-_], between the Issuer and the Indenture Trustee, World Financial Network
National Bank, as Servicer (the "SERVICER") under the Transfer and Servicing
Agreement, dated as of [200_-_] (the "TRANSFER AND SERVICING AGREEMENT") between
the Servicer, WFN Credit Company, as LLC, as Transferor and the Issuer is
required to prepare certain information each month regarding current
distributions to the Series [200_-_] Noteholders and the performance of the
Trust during the previous month. The information 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.
Capitalized terms used herein are defined in the Indenture and the Indenture
Supplement.
A. Information regarding distributions in respect of the Notes
1. The total amount of the distribution
in respect of Class A Notes...................... $ _________
2. The amount of the distribution set forth in
paragraph above in respect of principal of the
Class A Notes.................................... $ _________
3. The amount of the distribution set forth in
paragraph 1 above in respect of interest on the
Class A Notes.................................... $ _________
4. The total amount of the distribution in respect of
Class B Notes.................................... $ _________
5. The amount of the distribution set forth in
paragraph 4 above in respect of principal of the
Class B Notes................................... $ _________
6. The amount of the distribution set forth in
paragraph 4 above in respect of interest on the
Class B Notes................................... $ _________
7. The total amount of the distribution in respect of
Class C Notes................................... $ _________
Exhibit C-1
8. The amount of the distribution set forth in
paragraph 7 above in respect of principal of the
Class C Notes................................... $ _________
9. The amount of the distribution set forth in
paragraph 7 above in respect of interest on the
Class C Notes................................... $ _________
RECEIVABLES -
Beginning of the Month Principal Receivables: $ ______
Beginning of the Month Finance Charge Receivables: $ ______
Beginning of the Month Discount Option Receivables: $ ______
Beginning of the Month Total Receivables: $ ______
Removed Principal Receivables: $ ______
Removed Finance Charge Receivables: $ ______
Removed Total Receivables: $ ______
Additional Principal Receivables: $ ______
Additional Finance Charge Receivables: $ ______
Additional Total Receivables: $ ______
Discount Option Receivables Generated this Period: $ ______
Net Recoveries for month of __________ 200_ $ ______
End of the Month Principal Receivables: $ ______
End of the Month Finance Charge Receivables: $ ______
End of the Month Discount Option Receivables: $ ______
Exhibit C-2
End of the Month Total Receivables: $ ______
Excess Funding Account Balance: $ ______
Aggregate Principal Balance: $ ______
Minimum Aggregate Principal Balance: $ ______
End of the Month Transferor Amount: $ ______
Minimum Transferor Amount: $ ______
DELINQUENCIES AND LOSSES -
End of the Month Delinquencies: RECEIVABLES
30-59 Days Delinquent $ ______
60-89 Days Delinquent $ ______
90+ Days Delinquent $ ______
Total 30+ Days Delinquent $ ______
Defaulted Receivables During the Month $ ______
NOTE PRINCIPAL BALANCES -
Class A Note Principal Balance $ ______
Class B Note Principal Balance $ ______
Class C Note Principal Balance $ ______
SERIES [200_-_]
ALLOCATION PERCENTAGE
%
AVAILABLE FINANCE CHARGE COLLECTIONS $ ______
Exhibit C-3
INVESTOR DEFAULT AMOUNT $ ______
INVESTOR UNCOVERED DILUTION AMOUNT $ ______
NOTEHOLDER SERVICING FEES $ ______
AVAILABLE PRINCIPAL COLLECTIONS $ ______
EXCESS FINANCE CHARGE COLLECTIONS $ ______
SHARED PRINCIPAL COLLECTIONS $ ______
CASH COLLATERAL ACCOUNT BALANCE $ ______
RESERVE ACCOUNT BALANCE $ ______
SPREAD ACCOUNT BALANCE $ ______
PRE-FUNDING
INITIAL COLLATERAL AMOUNT $ ______
COLLATERAL AMOUNT $ ______
PRE-FUNDED AMOUNT $ ______
PRE-FUNDING ACCOUNT BALANCE $ ______
APPLICATION OF COLLECTIONS -
CLASS A MONTHLY INTEREST $ ______
CLASS B MONTHLY INTEREST $ ______
CLASS C MONTHLY INTEREST $ ______
INVESTOR DEFAULT AMOUNT $ ______
INVESTOR UNCOVERED DILUTION AMOUNT $ ______
INVESTOR CHARGEOFFS AND REALLOCATED
PRINCIPAL COLLECTIONS NOT
PREVIOUSLY REIMBURSED $ ______
Exhibit C-4
AMOUNTS TO BE DEPOSITED
IN THE CASH COLLATERAL ACCOUNT $ ______
AMOUNTS TO BE DEPOSITED IN THE
RESERVE ACCOUNT $ ______
AMOUNTS TO BE DEPOSITED
IN THE SPREAD ACCOUNT $ ______
EXCESS FINANCE CHARGES COLLECTIONS -
TOTAL EXCESS FINANCE CHARGE COLLECTIONS
FOR ALL ALLOCATION SERIES $ ______
SHARED PRINCIPAL COLLECTIONS -
TOTAL SHARED PRINCIPAL COLLECTIONS
FOR ALL ALLOCATIONS SERIES $ ______
YIELD AND BASE RATE -
Base Rate (Current Month) ______ %
Base Rate (Prior Month) ______ %
Base Rate (Two Months Ago) ______ %
THREE MONTH AVERAGE BASE RATE
______ %
Portfolio Yield (Current Month) ______ %
Portfolio Yield (Prior Month) ______ %
Portfolio Yield (Two Months Ago) ______ %
THREE MONTH AVERAGE PORTFOLIO YIELD ______ %
Exhibit C-5
PORTFOLIO ADJUSTED YIELD ______ %
PRINCIPAL COLLECTIONS -
MONTHLY PRINCIPAL ______ %
PRINCIPAL ACCUMULATION ACCOUNT BALANCE $ ______
SERIES [200_-_] PRINCIPAL SHORTFALL $ ______
SHARED PRINCIPAL COLLECTIONS ALLOCABLE
FROM OTHER PRINCIPAL SHARING SERIES $ ______
INVESTOR CHARGE OFFS AND REDUCTIONS -
INVESTOR CHARGE OFFS $ ______
REALLOCATED PRINCIPAL COLLECTIONS $ ______
REDUCTIONS IN COLLATERAL AMOUNT
(OTHER THAN BY PRINCIPAL PAYMENTS) $ ______
REDUCTIONS IN COLLATERAL AMOUNT DUE TO
APPLICATION OF AVAILABLE PRINCIPAL
COLLECTIONS AS SHARED PRINCIPAL
COLLECTIONS $ ______
PREVIOUS REDUCTIONS IN COLLATERAL AMOUNT
REIMBURSED $ ______
_____________________________________
as Indenture Trustee
By: ____________________________________
Name:
Title:
Exhibit C-6
EXHIBIT D
FORM OF MONTHLY SERVICER'S CERTIFICATE
WORLD FINANCIAL NETWORK NATIONAL BANK
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST SERIES [200_-_]
The undersigned, a duly authorized representative of World Financial
Network National Bank ("WFN"), as Servicer pursuant to the Transfer and
Servicing Agreement, dated as of [______ __, 2001] (as amended and supplemented,
the "TRANSFER AND SERVICING AGREEMENT"), among WFN Credit Company, LLC, as
Transferor, World Financial Network National Bank, as Servicer and World
Financial Network Master Note Trust (the "TRUST"), as Issuer, does hereby
certify as follows:
1. Capitalized terms used in this Certificate have their respective
meanings set forth in the Transfer and Servicing Agreement or the Master
Indenture dated as of [_______ __, 2001] (as amended or supplemented, the
"MASTER INDENTURE"), between the Trust and BNY Midwest Trust Company, as
indenture trustee (the "INDENTURE TRUSTEE") as supplemented by the Series
[200_-_] Indenture Supplement, dated as of [_____ __, 200_], between the Trust
and the Indenture Trustee (as amended and supplemented, the "INDENTURE
SUPPLEMENT") and together with the Master Indenture, the "INDENTURE"), as
applicable.
2. WFN is, as of the date hereof, the Servicer under the Transfer
and Servicing Agreement.
3. The undersigned is an Authorized Officer of the Servicer.
4. This Certificate relates to the Distribution Date occurring on
________ __, 200_.
5. As of the date hereof, to the best knowledge of the undersigned, the
Servicer has performed in all material respects all of its obligations under the
Transfer and Servicing Agreement and the Indenture through the Monthly Period
preceding such Distribution Date [or, if there has been a default in the
performance of any such obligation, set forth in detail the (i) nature of such
default, (ii) the action taken by the Servicer, if any, to remedy such default
and (iii) the current status of each such default]; if applicable, insert
"None".
6. As of the date hereof, to the best knowledge of the undersigned, no
Early Amortization Event occurred on or prior to such Distribution Date.
Exhibit D-1
IN WITNESS WHEREOF, the undersigned has duly executed and
delivered this Certificate this ___ day of _____________ __, 20__.
WORLD FINANCIAL NETWORK NATIONAL BANK,
as Servicer
By: ____________________________________
Name:
Title: