-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, CWD9P6D9PdbNTxt9QpG44YgzPD709JPTPMFrpMLB0gWsKNt2rWpxLefkP9nimITT pEMTrRXWhVMxHV+awC2Rgg== 0000950131-01-001542.txt : 20010316 0000950131-01-001542.hdr.sgml : 20010316 ACCESSION NUMBER: 0000950131-01-001542 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 9 CONFORMED PERIOD OF REPORT: 20010306 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 20010315 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST CONSUMERS NATIONAL BANK CENTRAL INDEX KEY: 0000888945 STANDARD INDUSTRIAL CLASSIFICATION: ASSET-BACKED SECURITIES [6189] IRS NUMBER: 930982044 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 033-89192-01 FILM NUMBER: 1569438 BUSINESS ADDRESS: STREET 1: 9300 SW GEMINI DRIVE CITY: BEAVERTON STATE: OR ZIP: 97008 BUSINESS PHONE: 5032936181 MAIL ADDRESS: STREET 1: 9300 S W GEMINI DRIVE CITY: BEAVERTON STATE: OR ZIP: 97008 FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIRST CONSUMERS MASTER TRUST CENTRAL INDEX KEY: 0000893331 STANDARD INDUSTRIAL CLASSIFICATION: [] IRS NUMBER: 363826636 STATE OF INCORPORATION: IL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 333-48860-01 FILM NUMBER: 1569439 BUSINESS ADDRESS: STREET 1: C/O BANKERS TRUST CO STREET 2: 4 ALBANY STREET 10TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10006 BUSINESS PHONE: 5035208264 MAIL ADDRESS: STREET 1: C/O BANKERS TRUST CO STREET 2: 4 ALBANY STREET 10TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10006 8-K 1 0001.txt FORM 8-K ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 8-K Current Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 Date of Report (Date of Earliest Event Reported) March 6, 2001 ------------- First Consumers National Bank First Consumers Master Trust - -------------------------------------------------------------------------------- (Exact Name of Registrant as Specified in its Charter) Illinois - -------------------------------------------------------------------------------- (State or Other Jurisdiction of Incorporation) 333-48860 and 333-48860-01 93-098-2044 - ---------------------------------- -------------------------------------- (Commission File Number) (I.R.S. Employer Identification No.) 9300 S.W. Gemini Drive, Beaverton, OR 97008 - ------------------------------------------------------------------------------------------ (Address of Principal Executive Offices) (Zip Code)
(630) 986-8800 - -------------------------------------------------------------------------------- (Registrant's Telephone Number, Including Area Code) No Change - -------------------------------------------------------------------------------- (Former Name or Former Address, if Changed Since Last Report) ================================================================================ Item 2. Acquisition or Disposition of Assets. On March 6, 2001, Registrants caused the issuance and sale by First Consumers Card Master Note Trust of $462,000,000 aggregate principal amount of Class A Series 2000-A Floating Rate Asset-Backed Notes, $63,000,000 aggregate principal amount of Class B Series 2000-A Floating Rate Asset-Backed Notes, and $36,000,000 aggregate principal amount of Class C Series 2000-A Floating Rate Asset-Backed Notes. The Registrant is filing final forms of the exhibits listed in Item 7(c) below relating to the Notes. Item 7. Financial Statements and Exhibits. (c) Exhibits. Exhibit No. Document Description ------- -------------------- (a) Not applicable (b) Not applicable (c) Exhibit 1.1 Underwriting Agreement, dated March 1, 2001, among Deutsche Banc Alex. Brown Inc., Representative of the Underwriters, First Consumers National Bank and Spiegel, Inc. Exhibit 4.1 Master Indenture, dated as of March 1, 2001, between First Consumers Credit Card Master Note Trust and The Bank of New York Exhibit 4.2 Indenture Supplement, dated as of March 1, 2001, between First Consumers Credit Card Master Note Trust and The Bank of New York Exhibit 4.3 Transfer and Servicing Agreement, dated as of March 1, 2001, between First Consumers National Bank and First Consumers Credit Card Master Note Trust Exhibit 4.4 Trust Agreement, dated as of March 1, 2001, between First Consumers National Bank and Bankers Trust Company Exhibit 4.5 Administration Agreement, dated as of March 1, 2001, between First Consumers Credit Card Master Note Trust and First Consumers National Bank Exhibit 4.6 Collateral Series Supplement including form of Collateral Certificate, dated as of March 1, 2001, between First Consumers National Bank and The Bank of New York Exhibit 4.7 Note Purchase Agreement, dated as of March 1, 2001, between First Consumers National Bank and Deutsche Banc Alex. Brown Inc. -2- SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. FIRST CONSUMERS NATIONAL BANK (Co-Registrant) Dated: March 9, 2001 By: /s/ John R. Steele ------------------- Name: John R. Steele Title: Treasurer and Director FIRST CONSUMERS MASTER TRUST (Co-Registrant) By: First Consumers National Bank, as originator of First Consumers Master Trust Dated: March 9, 2001 By: /s/ John R. Steele ------------------- Name: John R. Steele Title: Treasurer and Director -3- EX-1.1 2 0002.txt UNDERWRITING AGREEMENT DATED MARCH 1, 2001 Exhibit 1.1 ----------- February 22, 2001 First Consumers Credit Card Master Note Trust $462,000,000 Class A Floating Rate Asset Backed Notes, Series 2001-A $63,000,000 Class B Floating Rate Asset Backed Notes, Series 2001-A UNDERWRITING AGREEMENT ---------------------- Deutsche Banc Alex. Brown Inc as Representative of the Underwriters set forth herein (the "Representative") -------------- 31 West 52/nd/ Street New York, NY 10019 Ladies and Gentlemen: 1. Introductory. First Consumers National Bank (the "Bank") proposes to ------------ ---- cause First Consumers Credit Card Master Note Trust (the "Issuer") to issue ------ $462,000,000 aggregate principal amount of Class A Series 2001-A Floating Rate Asset Backed Notes (the "Class A Notes"), $63,000,000 aggregate principal amount ------------- of Class B Series 2001-A Floating Rate Asset Backed Notes (the "Class B Notes"), ------------- and $36,000,000 aggregate principal amount of Class C Series 2001-A Floating Rate Asset Backed Notes (the "Class C Notes" and together with the Class A Notes ------------- and the Class B Notes, the "Notes") ----- The Issuer will be a common law trust formed pursuant to a Trust Agreement, to be dated as of March 1, 2001 (the "Trust Agreement"), between the Bank and --------------- Bankers Trust Company, as owner trustee (the "Owner Trustee"). The Notes will ------------- be issued pursuant to a Master Indenture, to be dated as of March 1, 2001 (the "Master Indenture"), between the Issuer and The Bank of New York, as indenture - ----------------- trustee (the "Indenture Trustee"), as supplemented by the Series 2001-A ----------------- Indenture Supplement with respect to the Notes to be dated as of March 1, 2001 (the "Indenture Supplement," and together with the Master Indenture, the -------------------- "Indenture"). - ---------- Initially, the primary asset of the Issuer will be a certificate (the "Collateral Certificate") representing a beneficial interest in the assets held - ----------------------- in the First Consumers Master Trust ("FCMT"), issued pursuant to the Amended and ---- Restated Pooling and Servicing Agreement, dated as of February 1, 1999 (as heretofore amended, the "Amended and Restated Pooling and Servicing ------------------------------------------ -1- Agreement"), among the Bank and The Bank of New York (successor-in-interest to - --------- the corporate trust administration of Harris Trust and Savings Bank), as trustee (the "FCMT Trustee"), and the Collateral Series Supplement, to be dated as of ------------ March 1, 2001, to the Amended and Restated Pooling and Servicing Agreement (the "Collateral Supplement" and together with the Amended and Restated Pooling and --------------------- Servicing Agreement, the "PSA"). The assets of FCMT include, among other things, --- certain amounts due (the "Receivables") on a pool of private label credit card ----------- accounts (the "Accounts"). -------- The Receivables are transferred by the Bank to FCMT pursuant to the Amended and Restated Pooling and Servicing Agreement. The Collateral Certificate will be transferred by the Bank to the Issuer pursuant to the Transfer and Servicing Agreement, to be dated as of March 1, 2001 (the "Transfer and Servicing ---------------------- Agreement"), among the Bank, as Seller and Servicer, and the Issuer. - --------- The Bank has agreed to provide notices and perform on behalf of the Issuer certain other administrative obligations required by the Transfer and Servicing Agreement, the Master Indenture and each indenture supplement for each series of Notes issued by the Issuer, pursuant to an Administration Agreement, to be dated as of March 1, 2001 (the "Administration Agreement"), between the Bank, as ------------------------ administrator (in such capacity, the "Administrator"), and the Issuer. The ------------- Transfer and Servicing Agreement, the PSA, the Indenture, the Trust Agreement and the Administration Agreement are referred to herein, collectively, as the "Transaction Documents." - ---------------------- This Underwriting Agreement is referred to herein as this "Agreement." To --------- the extent not defined herein, capitalized terms used herein have the meanings assigned in the Transaction Documents. The Class C Notes will be sold pursuant to a Class C Note Purchase Agreement, to be dated as of March 2001, among the Issuer, the Bank and the initial purchaser of the Class C Notes named therein. The Bank and Spiegel, Inc. ("Spiegel") hereby agree, severally and not ------- jointly, with the underwriters for the Class A Notes listed on Schedule A hereto ---------- (the "Class A Underwriters") and the underwriters for the Class B Notes listed -------------------- on Schedule A hereto (the "Class B Underwriters" and together with the Class A ---------- -------------------- Underwriters, the "Underwriters") as follows: ------------ 2. Representations and Warranties of the Bank and Spiegel. Each of the ------------------------------------------------------ Bank and Spiegel represents and warrants to, and agrees with, the Underwriters that: (a) Spiegel is duly organized and validly existing in good standing as a corporation under the laws of the State of Delaware, and has all requisite corporate power, authority and legal right to own its property and transact the business in which it is now engaged. -2- (b) The Bank is a national banking association duly organized and validly existing in good standing under the laws of the United States, and has all requisite corporate power, authority and legal right to own its property and conduct its credit card business as such properties are now owned and such business is conducted at present, and to own the Accounts and to execute, deliver and perform its obligations under the Transfer and Servicing Agreement, the PSA and the Administration Agreement. (c) The execution and delivery of each of the Transaction Documents to which it is a party, and the incurrence of the obligations therein set forth and the consummation of the transactions contemplated thereunder have been duly authorized by the Bank by all necessary action on the part of the Bank. (d) This Agreement has been duly authorized, executed and delivered by the Bank and Spiegel. (e) Each of the Transaction Documents has been, or on or before the Closing Date will be, executed and delivered by the Bank and when executed and delivered by the other parties thereto, will constitute a valid and binding agreement of the Bank enforceable against the Bank in accordance with its terms, except, in each case, to the extent that (i) the enforceability thereof may be subject to insolvency, reorganization, moratorium, receivership or other similar laws now or hereafter in effect relating to creditors' or other obligees' rights generally or the rights of creditors or other obligees of institutions insured by the FDIC, (ii) the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought and (iii) certain remedial provisions of the Indenture may be unenforceable in whole or in part under the UCC, but the inclusion of such provisions does not render the other provisions of the Indenture invalid and notwithstanding that such provisions may be unenforceable in whole or in part, the Indenture Trustee, on behalf of the Noteholders, will be able to enforce the remedies of a secured party under the UCC. (f) The Notes will be issued pursuant to the terms of the Indenture and, when executed by the Owner Trustee on behalf of the Issuer and authenticated by the Indenture Trustee in accordance with the Indenture and delivered pursuant to this Agreement, will be validly issued and outstanding. The Notes will be in the form contemplated by the Indenture, and the Notes and the Indenture will conform to the descriptions thereof contained in the Prospectus and Registration Statement, as amended or supplemented. (g) The Collateral Certificate will be issued pursuant to the terms of the PSA and, when executed by the FCMT Trustee in accordance with the PSA, will be validly issued and outstanding. The Collateral Certificate will be in the form contemplated by the PSA, and the Collateral Certificate and the PSA will conform to the description thereof contained in the Prospectus and the Registration Statement, as amended or supplemented. -3- (h) Neither Spiegel nor the Bank is in violation of any Requirement of Law or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan agreement, note, lease or other instrument to which it is a party or by which it is bound or to which any of its property is subject, which violations or defaults separately or in the aggregate would have a material adverse effect on Spiegel or the Bank. (i) None of the issuance and sale of the Notes, the issuance of the Collateral Certificate or the execution and delivery by Spiegel or the Bank of this Agreement or any Transaction Document to which it is a party, nor the incurrence by Spiegel or the Bank of the obligations herein and therein set forth, nor the consummation of the transactions contemplated hereunder or thereunder, nor the fulfillment of the terms hereof or thereof does or will (i) violate any Requirement of Law presently in effect, applicable to it or its properties or by which it or its properties are or may be bound or affected, (ii) conflict with, or result in a breach of, or constitute a default under, any indenture, contract, agreement, deed, lease, mortgage or instrument to which it is a party or by which it or its properties are bound or (iii) result in the creation or imposition of any Lien upon any of its property or assets, except for those encumbrances created under the Transaction Documents. (j) All consents, approvals, authorizations, orders, filings, registrations or qualifications of or with any court or any other governmental agency, board, commission, authority, official or body required in connection with the execution and delivery by Spiegel or the Bank of this Agreement or the Transaction Documents to which it is a party or to the consummation of the transactions contemplated hereunder and thereunder, or to the fulfillment of the terms hereof and thereof have been or will have been obtained on or before the Closing Date. (k) All actions required to be taken by Spiegel and the Bank as a condition to the offer and sale of the Class A Notes and the Class B Notes as described herein or the consummation of any of the transactions described in the Prospectus and the Registration Statement (each as defined below) have been or, prior to the Closing Date, will be taken. (l) The Indenture has been duly qualified under the Trust Indenture Act of 1939, as amended (the "TIA"), and complies as to form with the TIA --- and the rules and regulations of the Securities and Exchange Commission (the "Commission") thereunder. ---------- (m) The representations and warranties made by the Bank in the Transfer and Servicing Agreement, the PSA, the Trust Agreement and the Administration Agreement or made in any Officer's Certificate of the Bank delivered pursuant to any Transaction Document to which it is a party will be true and correct at the time made and on and as of the Closing Date as if set forth herein, except that to the extent that any such representation or warranty expressly relates to an earlier date, such representation or warranty is true and correct at and as of such earlier date. -4- (n) The Receivables had an aggregate outstanding balance determined as of January 1, 2001 in the amount set forth in the Prospectus. (o) The Bank agrees it has not granted, assigned, pledged or transferred and shall not grant, assign, pledge or transfer to any Person a security interest in, or any other right, title or interest in, the Receivables or the Collateral Certificate, except as provided in the PSA and the Transfer and Servicing Agreement and agrees to take all actions required by the PSA or the Transfer and Servicing Agreement in order to maintain the security interests in the Receivables and the Collateral Certificate granted pursuant to the PSA and the Transfer and Servicing Agreement. (p) A registration statement on Form S-3 (Nos. 333-48860 and 333- 48860-01), including a form of prospectus and such amendments thereto as may have been filed prior to the date hereof, relating to the Class A Notes and the Class B Notes and the offering thereof in accordance with Rule 415 under the Securities Act of 1933, as amended (the "Act"), has been filed --- with, and has been declared effective by, the Commission. If any post- effective amendment to such registration statement has been filed with the Commission prior to the execution and delivery of this Agreement, the most recent such amendment has been declared effective by the Commission. For purposes of this Agreement, "Effective Time" means the date and time as of -------------- which such registration statement, or the most recent post-effective amendment thereto, if any, was declared effective by the Commission, and "Effective Date" means the date of the Effective Time. Such registration --------------- statement, as amended at the Effective Time, is hereinafter referred to as the "Registration Statement." The Bank proposes to file with the Commission ---------------------- pursuant to Rule 424(b) ("Rule 424(b)") under the Act a supplement (the ----------- "Prospectus Supplement") to the prospectus included in the Registration ---------------------- Statement (such prospectus, in the form it appears in the Registration Statement or in the form most recently revised and filed with the Commission pursuant to Rule 424(b), is hereinafter referred to as the "Base ---- Prospectus") relating to the Class A Notes and the Class B Notes and the ---------- method of distribution thereof. The Base Prospectus and the Prospectus Supplement, together with any amendment thereof or supplement thereto, are hereinafter referred to as the "Prospectus". ---------- (q) On the Effective Date, the Registration Statement conformed in all respects to the requirements of the Act and the rules and regulations of the Commission thereunder (the "Rules and Regulations") and the TIA and the --------------------- rules and regulations thereunder and did not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and on the date of this Agreement, the Registration Statement and the Prospectus conform, and at the time of filing of the Prospectus pursuant to Rule 424(b) the Registration Statement and the Prospectus will conform, in all respects with the requirements of the Act and the Rules and Regulations and the TIA and the rules and regulations thereunder and neither of such documents includes, or will include, any untrue statement of a material fact or omits, or will -5- omit, to state any material fact required to be stated therein or necessary to make the statements therein not misleading, except that the foregoing does not apply to statements in or omissions from either of such documents based upon written information furnished to the Bank by the Underwriters specifically for use therein. Each of the Bank and Spiegel hereby acknowledges that (i) the only information provided by the Class A Underwriters for inclusion in the Registration Statement and the Prospectus is set forth on the cover page of the Prospectus Supplement in the table under the heading "Class A Notes" and on the line across from "Price to public," in the table listing the Class A Underwriters and the Principal Amount of Class A Notes under the heading "Underwriting" in the Prospectus Supplement, in the table following the third paragraph under the heading "Underwriting" in the Prospectus Supplement in the column labeled "Class A Notes", and in the first sentence of the penultimate paragraph under the heading "Underwriting" in the Prospectus Supplement (the "Class A ------- Underwriters' Information"), and (ii) the only information provided by the ------------------------- Class B Underwriters for inclusion in the Registration Statement and the Prospectus is set forth on the cover page of the Prospectus Supplement in the table under the heading "Class B Notes" and on the line across from "Price to public," in the table listing the Class B Underwriters and the Principal Amount of Class B Notes and under the heading "Underwriting" in the Prospectus Supplement, in the table following the third paragraph under the heading "Underwriting" in the Prospectus Supplement in the column labeled "Class B Notes", and in the first sentence of the penultimate paragraph under the heading "Underwriting" in the Prospectus Supplement (the "Class B Underwriters' Information"). --------------------------------- (r) Since the respective dates as of which information is given in the Registration Statement and the Prospectus, except as otherwise set forth therein, there has not been any material adverse change, or any development involving a prospective material adverse change, in the condition, financial or otherwise, or in the earnings, business or operations of the Bank that would have a material adverse effect on the Bank or the Issuer. 3. Purchase, Sale, Payment and Delivery of the Class A Notes and Class B --------------------------------------------------------------------- Notes. - ----- (a) On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Bank agrees to sell to the Class A Underwriters, and the Class A Underwriters agree to purchase from the Bank, at a purchase price of 99.7% of the principal amount thereof, $462,000,000 aggregate principal amount of the Class A Notes, each Class A Underwriter to purchase the amounts shown on Schedule A hereto. ---------- (b) On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Bank agrees to sell to the Class B Underwriters, and the Class B Underwriters agree to purchase from the Bank, at a purchase price of 99.575% of the principal amount thereof, $63,000,000 aggregate principal amount of the Class B Notes, each Class B Underwriter to purchase the amounts shown on Schedule A hereto. ---------- -6- (c) The Bank will cause the Issuer to deliver the Class A Notes and the Class B Notes to the Underwriters against payment of the purchase price in immediately available funds, drawn to the order of the Bank, at the office of Mayer, Brown & Platt, in Chicago, Illinois at 10:00 a.m., Chicago time, on March 6, 2001, or at such other time not later than seven full business days thereafter as the Representative and the Bank determine, such time being herein referred to as the "Closing Date." Each of the Class A ------------ Notes and the Class B Notes so to be delivered shall be represented by one or more definitive notes registered in the name of Cede & Co., as nominee for The Depository Trust Company. The Class A Notes and the Class B Notes will be available for inspection by the Underwriters at the office at which the Notes are to be delivered no later than five hours before the close of business in Chicago on the business day prior to the Closing Date. 4. Offering by Underwriters. It is understood that after the Effective ------------------------ Date, the Underwriters propose to offer the Class A Notes and the Class B Notes for sale to the public (which may include selected dealers) as set forth in the Prospectus. 5. Certain Agreements of the Bank. The Bank agrees with the Underwriters ------------------------------ that: (a) Immediately following the execution of this Agreement, the Bank will prepare a Prospectus Supplement setting forth the amount of Class A Notes and Class B Notes covered thereby and the terms thereof not otherwise specified in the Base Prospectus, the price at which such Class A Notes and Class B Notes are to be purchased by the Class A Underwriters and Class B Underwriters, respectively, the initial public offering price, the selling concessions and allowances, and such other information as the Bank deems appropriate. The Bank will transmit the Prospectus, including such Prospectus Supplement, to the Commission pursuant to Rule 424(b) by a means reasonably calculated to result in filing with the Commission pursuant to Rule 424(b). The Bank will not file any amendment of the Registration Statement with respect to the Class A Notes or Class B Notes or supplement to the Prospectus unless a copy has been furnished to the Representative for its review a reasonable time prior to the proposed filing thereof or to which the Representative shall reasonably object in writing. The Bank will advise the Representative promptly of (i) the effectiveness of any amendment or supplementation of the Registration Statement or Prospectus, (ii) any request by the Commission for any amendment or supplementation of the Registration Statement or the Prospectus or for any additional information, (iii) the receipt by the Bank of any notification with respect to the suspension of qualification of the Class A Notes or Class B Notes for sale in any jurisdiction or the initiation or threatening of any proceeding for such purposes and (iv) the institution by the Commission of any stop order proceeding in respect of the Registration Statement, and will use its best efforts to prevent the issuance of any such stop order and to obtain as soon as possible its lifting, if issued. -7- (b) If at any time when a prospectus relating to the Class A Notes and Class B Notes is required to be delivered under the Act, any event occurs as a result of which the Prospectus, as then amended or supplemented, would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Act, the Bank promptly will prepare and file with the Commission an amendment or supplement which will correct such statement or omission or an amendment which will effect such compliance. Neither the Underwriters' consent to, nor the Underwriters' delivery of, any such amendment or supplement shall constitute a waiver of any of the conditions set forth in Section 6. (c) As soon as practicable, the Bank will cause the Issuer to make generally available to the Class A Noteholders and Class B Noteholders an earnings statement or statements of the Issuer covering a period of at least 12 months beginning after the Effective Date which will satisfy the provisions of Section 11(a) of the Act and Rule 158 of the Commission promulgated thereunder. (d) The Bank will furnish to the Representative copies of the Registration Statement (one of which will be signed and will include all exhibits), the Prospectus and all amendments and supplements to such documents, in each case as soon as available and in such quantities as the Representative reasonably requests. (e) The Bank will endeavor to qualify the Class A Notes and Class B Notes for sale under the securities or Blue Sky laws of such jurisdictions as the Representative shall reasonably request and the determination of the eligibility for investment of the Class A Notes and Class B Notes under the laws of such jurisdictions as the Representative may designate and will continue such qualifications in effect so long as required for the distribution of the Class A Notes and Class B Notes; provided, however, -------- ------- that the Bank shall not be obligated to qualify to do business in any jurisdiction where such qualification would subject the Bank to general or unlimited service of process in any jurisdiction where it is not now so subject. (f) So long as any Class A Note or Class B Note is outstanding, the Bank will furnish, or cause the Servicer to furnish, to the Representative copies of each certificate and the annual statements of compliance delivered to the Owner Trustee, the Indenture Trustee and each Rating Agency pursuant to Section 3.5 of the Transfer and Servicing Agreement and independent certified public accountant's servicing reports furnished to the Indenture Trustee, the Servicer and the Rating Agencies pursuant to Sections 3.6(a) and (b) of the Transfer and Servicing Agreement, by first class mail as soon as practicable after such certificates, statements and reports are furnished to the Owner Trustee, the Indenture Trustee or the Rating Agencies, as the case may be. -8- (g) So long as any Class A Note or Class B Note is outstanding, the Bank will furnish, or cause the Servicer to furnish, to the Representative, by first-class mail as soon as practicable (i) all documents concerning the Class A Notes and Class B Notes distributed by the Bank or the Servicer to the Owner Trustee, the Indenture Trustee or the Noteholders, or filed with the Commission pursuant to the Securities Exchange Act of 1934, as amended (the "Exchange Act"), (ii) any order of the Commission under the Act or the ------------ Exchange Act applicable to the Issuer or to the Bank, or pursuant to a "no- action" letter obtained from the staff of the Commission by the Bank and affecting the Issuer or the Bank and (iii) from time to time, such other information concerning the Issuer as the Representative may reasonably request. (h) Whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated for any reason, the Bank will pay all expenses incident to the performance of its obligations under this Agreement and will reimburse the Underwriters for any reasonable expenses (including reasonable fees and disbursements of counsel to the Underwriters) incurred by them in connection with the transactions contemplated by this Agreement, including without limitation, all reasonable costs and expenses (i) incident to the preparation, issuance, execution, authentication and delivery of the Class A Notes and Class B Notes, (ii) incident to the preparation, printing (including word processing and duplication costs) and delivery of the Prospectus and Preliminary Prospectus (including in each case all exhibits, amendments, attachments and supplements thereto), (iii) in connection with the printing (including word processing and duplication costs) and delivery of this Agreement and the other Transaction Documents and the furnishing to the Underwriters of copies of the Prospectus as herein provided, (iv) in connection with the structuring and marketing of the Class A Notes and Class B Notes, (v) incident to the qualification of the Class A Notes and Class B Notes for sale and determination of the eligibility of the Class A Notes and Class B Notes for investment under the laws of such jurisdictions as the Representative designates, (vi) for any fees charged by investment rating agencies for the rating of the Class A Notes and Class B Notes and (vii) for any filing fee of the National Association of Securities Dealers, Inc. relating to the Class A Notes and Class B Notes. (i) To the extent, if any, that any of the ratings provided with respect to the Class A Notes or Class B Notes by any Rating Agency are conditional upon the furnishing of documents or the taking of any other actions by the Bank, the Bank shall furnish such documents and take any such other actions as are reasonably necessary to satisfy such condition. 6. Conditions of the Obligations of the Underwriters. The obligation of ------------------------------------------------- the Class A Underwriters and Class B Underwriters to purchase and pay for the Class A Notes and Class B Notes, respectively, will be subject to the accuracy of the representations and warranties by Spiegel and the Bank herein, to the accuracy of the statements of officers of Spiegel and the Bank made -9- pursuant to the provisions hereof, to the performance by Spiegel and the Bank of their respective obligations hereunder and to the following additional conditions precedent: (a) On or prior to the date of this Agreement, the Representative shall have received a letter, dated the date of this Agreement, of KPMG, confirming that they are independent public accountants within the meaning of the Act and the applicable published Rules and Regulations thereunder, substantially in the form heretofore agreed to and otherwise in form and in substance satisfactory to the Representative and its counsel. (b) The Prospectus shall have been filed with the Commission in accordance with the Rules and Regulations and Section 5(a) of this Agreement; and, prior to the Closing Date, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been instituted or, to the knowledge of the Bank or the Representative, shall be contemplated by the Commission. (c) Subsequent to the execution and delivery of this Agreement none of the following shall have occurred: (i) any change, or any development involving a prospective change, in or affecting particularly the business or properties of Spiegel or the Bank which, in the judgment of the Underwriters, make it impractical or inadvisable to proceed with the public offering or delivery of the Class A Notes and Class B Notes on the terms and in the manner contemplated in the Prospectus, (ii) trading in securities generally on the New York Stock Exchange, the American Stock Exchange or the over-the-counter market shall have been suspended or minimum prices shall have been established on either of such exchanges or such market by the Commission, by such exchange or by any other regulatory body or governmental authority having jurisdiction; (iii) a banking moratorium shall have been declared by Federal or state authorities; (iv) the United States shall have become engaged in hostilities, there shall have been an escalation of hostilities involving the United States or there shall have been a declaration of a national emergency or war by the United States; (v) there shall have occurred such a material adverse change in general economic, political or financial conditions (or the effect of international conditions on the financial markets of the United States shall be such) as to make it, in the judgment of the Underwriters, impractical or inadvisable to proceed with the public offering or delivery of the Class A Notes and Class B Notes on the terms and in the manner contemplated in the Prospectus or (vi) any material adverse change in the financial markets for asset-backed securities in the United States if, in the judgment of the Underwriters, the effect of which is to make it impractical or inadvisable to proceed with the public offering or delivery of the Class A Notes and Class B Notes on the terms and in the manner contemplated in the Prospectus. (d) The Representative shall have received an opinion, dated the Closing Date, of Rooks, Pitts and Poust, special counsel for Spiegel and the Bank, satisfactory in form and substance to the Representative and its counsel to the effect that: -10- (i) Spiegel is a corporation in good standing, duly organized and validly existing under the laws of the State of Delaware; the Bank is a national banking association in good standing, duly organized and validly existing under the laws of the United States of America; and each of Spiegel and the Bank (each collectively referred to in this subsection (d) as a "Spiegel Entity") is authorized by its certificate of incorporation or -------------- articles of association, as the case may be, to transact the business in which it is engaged and the Bank is not required to qualify or register as a foreign corporation, in any state in order to conduct its business as presently conducted, except where the failure to so qualify or register would not have a material adverse effect upon the Noteholders; (ii) Each Spiegel Entity has full corporate power and authority to enter into and perform its obligations under each Transaction Document and this Agreement to which it is a party; (iii) The Bank has the corporate power and authority and legal right to acquire, own, transfer and service the Receivables; (iv) Each of the Transaction Documents and this Agreement has been duly authorized, executed and delivered by each Spiegel Entity that is a party thereto; (v) No consent, approval, authorization or order of any court or governmental agency or body is required for (a) the execution and delivery by any Spiegel Entity of any Transaction Document or this Agreement to which such Spiegel Entity is a party or the performance by such Spiegel Entity of its obligations thereunder, or (b) the issuance and sale of the Notes; (vi) Neither the execution and delivery of the Transaction Documents and this Agreement by any Spiegel Entity that is party thereto nor the performance by such Spiegel Entity of the transactions therein contemplated nor the fulfillment of the terms thereof does or will result in any violation of any statute or regulation or any order or decree of any court or governmental authority binding upon such Spiegel Entity or its property, or conflict with, or result in a breach or violation of any term or provision, or result in a default under any of the terms and provisions, of such Spiegel Entity's certificate of incorporation or articles of association, as the case may be, or by-laws or any material indenture, loan agreement or other material agreement known to such counsel to which such Spiegel Entity is a party or by which such Spiegel Entity is bound; (vii) There is no legal or governmental proceeding pending to which any Spiegel Entity is a party or to which any Spiegel Entity is subject which, individually or in the aggregate (a) would have a material adverse effect on the ability of such Spiegel Entity to perform its obligations under the Transaction Documents or this -11- Agreement, (b) assert the invalidity of any Transaction Document, this Agreement, the Seller Interest or the Collateral Certificate, (c) seek to prevent the issuance, sale or delivery of the Notes or any of the transactions contemplated by the Transaction Documents or this Agreement or (d) seek to adversely affect the federal income tax consequences of the Notes; and (viii) The Registration Statement has become effective under the Act and no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or threatened under the Act. (ix) Each of the Transaction Documents to which the Bank is a party constitutes the legal, valid and binding agreement of the Bank under the laws of Illinois, enforceable against each such Person in accordance with its terms, subject to (w) limitations imposed by bankruptcy, insolvency, reorganization, liquidation, arrangement, fraudulent conveyance, moratorium, receivership, conservatorship, readjustment of debts, creditors' rights or other laws relating to or affecting the rights of creditors generally or the rights of creditors of national banking associations; (x) rights to indemnification and contribution which may be limited by applicable law and equitable principles or otherwise unenforceable as against public policy; (y) the unenforceability under certain circumstances of provisions imposing penalties, forfeiture, late payment charges, or an increase in interest rate upon delinquency in payment or the occurrence of any event of default; and (z) general principles of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing, and the possible unavailability of specific performance or injunctive relief, regardless of whether such enforceability is considered in a proceeding in equity or at law. (x) This Agreement constitutes the legal, valid and binding obligation of Spiegel and the Bank under the laws of the State of Illinois, enforceable against Spiegel and the Bank in accordance with its terms, subject to (w) limitations imposed by bankruptcy, insolvency, reorganization, liquidation, arrangement, fraudulent conveyance, moratorium, receivership, conservatorship, readjustment of debts, creditors' rights or other laws relating to or affecting the rights of creditors generally or the rights of creditors of national banking associations; (x) rights to indemnification and contribution which may be limited by applicable law and equitable principles or otherwise unenforceable as against public policy; (y) the unenforceability under certain circumstances of provisions imposing penalties, forfeiture, late payment charges, or an increase in interest rate upon delinquency in payment or the occurrence of any event of default; and (z) general principles of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing, and the possible unavailability of specific performance or -12- injunctive relief, regardless of whether such enforceability is considered in a proceeding in equity or at law. (xi) When the Class A Notes and Class B Notes have been duly executed and delivered by the Issuer, authenticated by the Indenture Trustee in accordance with the terms of the Indenture and delivered to and paid for by the Underwriters in accordance with this Agreement, they will be validly issued and outstanding, will constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms and will be entitled to the benefits of the Indenture, subject to (w) limitations imposed by bankruptcy, insolvency, reorganization, liquidation, arrangement, fraudulent conveyance, moratorium, receivership, conservatorship, readjustment of debts, creditors' rights or other laws relating to or affecting the rights of creditors generally or the rights of creditors of national banking associations; (x) rights to indemnification and contribution which may be limited by applicable law and equitable principles or otherwise unenforceable as against public policy; (y) the unenforceability under certain circumstances of provisions imposing penalties, forfeiture, late payment charges, or an increase in interest rate upon delinquency in payment or the occurrence of any event of default; and (z) general principles of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing, and the possible unavailability of specific performance or injunctive relief, regardless of whether such enforceability is considered in a proceeding in equity or at law. (xii) The statements in the Base Prospectus under the headings "Risk Factors--If a conservator or receiver were appointed for us, delays or reductions in payment of your notes could occur," "Material Legal Aspects of the Receivables," "ERISA Considerations" and "Federal Income Tax Consequences" and the statements in the Prospectus Supplement under the headings "Structural Summary--Tax Status" and "--ERISA Considerations" to the extent that they constitute matters of law or legal conclusions with respect thereto, have been reviewed by us and are correct in all material respects. (xiii) This Agreement, the Transaction Documents and the Notes conform in all material respects to the descriptions thereof contained in the Prospectus. (xiv) The Indenture has been duly qualified under the TIA and complies as to form with the TIA and the rules and regulations of the Commission thereunder. The Issuer is not now, and immediately following the issuance of the Notes pursuant to the Indenture will not be, required to be registered under the Investment Company Act of 1940, as amended. (xv) Subject to the discussion in the Base Prospectus under the heading "Federal Income Tax Consequences", the Class A Notes and Class B Notes will -13- properly be characterized as indebtedness and the issuance of the Notes will not cause the Issuer to be deemed an association (or publicly traded partnership) taxable as a corporation, for U.S. federal income tax purposes. (xvi) The Indenture constitutes the legal, valid and binding obligation of the Issuer under the laws of the State of Illinois, subject to (w) limitations imposed by bankruptcy, insolvency, reorganization, liquidation, arrangement, fraudulent conveyance, moratorium, receivership, conservatorship, readjustment of debts, creditors' rights or other laws relating to or affecting the rights of creditors generally or the rights of creditors of national banking associations; (x) rights to indemnification and contribution which may be limited by applicable law and equitable principles or otherwise unenforceable as against public policy; (y) the unenforceability under certain circumstances of provisions imposing penalties, forfeiture, late payment charges, or an increase in interest rate upon delinquency in payment or the occurrence of any event of default; and (z) general principles of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing, and the possible unavailability of specific performance or injunctive relief, regardless of whether such enforceability is considered in a proceeding in equity or at law. (xvii) Each of the Registration Statement, as of its effective date, and the Prospectus, as of its date, complied as to form in all material respects with the requirements of the Act and the Rules and Regulations under the Act, except that in each case such counsel need not express any opinion as to the financial and statistical data included therein or excluded therefrom or the exhibits to the Registration Statement and, except as and, to the extent set forth in paragraphs (xii) and (xiii), such counsel does not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement or the Prospectus. (xviii) If the FDIC is appointed as conservator or receiver for the Bank and if a court were to determine that the Indenture Trustee has a security interest in the Receivables and the proceeds thereof, the court would hold that the security interest of the Indenture Trustee would be enforceable against the Bank with respect to the Receivables and such proceeds. (xix) When the Indenture Trustee has taken possession of the Collateral Certificate issued by FCMT, the Transaction Documents have been executed and delivered and FCMT has received payment for the Collateral Certificate, the Indenture Trustee will become the registered holder of the Collateral Certificate, subject to no Liens of record. Such counsel also shall state that they have participated in conferences with representatives of Spiegel and the Bank and their accountants, the Underwriters and counsel -14- to the Underwriters concerning the Registration Statement and the Prospectus and have considered the matters to be stated therein and the matters stated therein, although they are not independently verifying the accuracy, completeness or fairness of such statements (except as stated in paragraph (xii) above) and based upon and subject to the foregoing, nothing has come to such counsel's attention to cause such counsel to believe that the Registration Statement (excluding any exhibits filed therewith), at the time it became effective, contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the statements therein not misleading, or that the Prospectus, as of the date hereof, contains any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading (it being understood that such counsel has not been requested to, and does not, make any comment in such opinion with respect to the financial statements, supporting schedules and other financial or statistical information contained in the Registration Statement or the Prospectus). (e) The Representative shall have received from Mayer, Brown & Platt, special counsel for the Underwriters, such opinion or opinions, dated the Closing Date, with respect to such matters relating to this transaction as the Representative may require, and the Bank shall have furnished to such counsel such documents as they request for the purpose of enabling them to pass upon such matters. (f) The Representative shall have received an opinion, dated the Closing Date, satisfactory in form and substance to the Representative and its counsel of (i) Ball Janik LLP, special Oregon counsel for the Bank, with respect to certain matters relating to the transfer of the Receivables from the Bank to FCMT under the PSA and (ii) Farleigh, Wada & Witt, special Oregon counsel for the Bank, with respect to the perfection of the security interest in favor of FCMT in the Receivables and the proceeds thereof. (g) The Representative shall have received a certificate from the Bank, dated the Closing Date, of a Treasurer, Vice President or more senior officer of the Bank in which such officer, to the best of his/her knowledge after reasonable investigation, shall state that (u) the representations and warranties of the Bank in this Agreement are true and correct on and as of the Closing Date, (v) the Bank has complied with all agreements and satisfied all conditions on its part to be performed or satisfied hereunder at or prior to the Closing Date, (w) the representations and warranties of the Bank contained in this Agreement and the Transaction Documents to which it is a party are true and correct as of the dates specified herein and therein, (x) no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are threatened by the Commission, (y) nothing has come to such officers' attention that would lead such officers to believe that the Registration Statement or the Prospectus, and any amendment or supplement thereto, as of its date and as of the Closing Date, contained an untrue statement of a material fact or omitted to state any material fact necessary in order to make the statements therein, in the light of the circumstances under which they were made, -15- not misleading, and (z) subsequent to the date of the Prospectus, there has been no material adverse change in the financial position or results of operation of the Bank's credit card business except as set forth in or contemplated by the Prospectus or as described in such certificate. (h) The Representative shall have received an opinion of Winston & Strawn, counsel to the Owner Trustee, dated the Closing Date, satisfactory in form and substance to the Representative and its counsel, to the effect that: (i) The Owner Trustee is duly incorporated and validly existing as a banking corporation in good standing under the laws of the State of New York; (ii) The Owner Trustee has the power and authority to execute, deliver and perform the Trust Agreement and to consummate the transactions contemplated thereby; (iii) The Trust Agreement has been duly authorized, executed and delivered by the Owner Trustee and constitutes a legal, valid and binding obligation of the Owner Trustee, enforceable against the Owner Trustee in accordance with its terms; (iv) Each of the Indenture, the Trust Agreement and the Transfer and Servicing Agreement (collectively referred to in this subsection (i) as the "Trust Documents") has been duly executed and --------------- delivered by the Owner Trustee, as Owner Trustee on behalf of the Issuer; (v) Neither the execution, delivery or performance by the Owner Trustee, in its individual capacity or as Owner Trustee, as the case may be, of the Trust Documents, nor the consummation of the transactions by the Owner Trustee, in its individual capacity or as Owner Trustee, as the case may be, contemplated thereby, requires the consent or approval of, the withholding of objection on the part of, the giving of notice to, the filing, registration or qualification with, or the taking of any other action in respect of, any governmental authority or agency of the States of New York and Illinois or the United States of America governing the banking or trust powers of the Owner Trustee; (vi) Neither the execution, delivery and performance by the Owner Trustee, in its individual capacity or as Owner Trustee, as the case may be, of the Trust Documents, nor the consummation of the transactions by the Owner Trustee, in its individual capacity or as Owner Trustee, as the case may be, contemplated thereby, is in violation of the charter or bylaws of the Owner Trustee or of any law, governmental rule or regulation of the State of Illinois, the State of New York or of the United States of America governing the banking or trust powers of the Owner -16- Trustee or, to such counsel's knowledge, without independent investigation, any indenture, mortgage, bank credit agreement, note or bond purchase agreement, long-term lease, license or other agreement or instrument to which it is a party or by which it is bound or, to such counsel's knowledge, without independent investigation, of any judgment or order applicable to the Owner Trustee; (vii) No consent, approval or other authorization of, or registration, declaration or filing with, any court or governmental agency or commission of the State of Illinois or the State of New York is required by or with respect to the Owner Trustee, in its individual capacity or as Owner Trustee, as the case may be, for the valid execution and delivery of the Trust Documents, or for the validity or enforceability thereof; and (viii) To such counsel's knowledge, without independent investigation, there are no pending or threatened actions, suits or proceedings affecting the Owner Trustee before any court or other governmental authority which, if adversely determined, would materially and adversely affect the ability of the Owner Trustee to carry out the transactions contemplated by the Trust Agreement. (ix) The Representative shall have received an opinion of Rooks, Pitts and Poust, special Illinois counsel to the Issuer, dated the Closing Date, satisfactory in form and substance to the Representative and its counsel, to the effect that: (i) The Issuer is validly existing as a common law trust under the laws of the State of Illinois; (ii) The Issuer, through the Owner Trustee, (A) has the trust power and authority pursuant to the Trust Agreement to (x) execute, deliver and perform its obligations under the Trust Agreement, the Administration Agreement, the Indenture and the Transfer and Servicing Agreement (collectively referred to in this subsection (j) as the "Trust Documents"), (y) to execute, deliver and issue the Notes, and ---------------- (z) to issue the Seller Interest, and (B) has duly authorized, executed and delivered the Trust Documents and the Notes; (iii) Each of the Trust Documents to which the Issuer is a party constitutes the legal, valid and binding agreement of the Issuer, acting through the Owner Trustee, under the laws of Illinois, enforceable against the Issuer, through the Owner Trustee, in accordance with its terms, subject to (w) limitations imposed by bankruptcy, insolvency, reorganization, liquidation, arrangement, fraudulent conveyance, moratorium, receivership, conservatorship, readjustment of debts, creditors' rights or other laws relating to or affecting the rights of creditors generally or the rights of creditors of national banking associations; (x) rights to indemnification and contribution which may be limited by applicable law and -17- equitable principles or otherwise unenforceable as against public policy; (y) the unenforceability under certain circumstances of provisions imposing penalties, forfeiture, late payment charges, or an increase in interest rate upon delinquency in payment or the occurrence of any event of default; and (z) general principles of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing, and the possible unavailability of specific performance or injunctive relief, regardless of whether such enforceability is considered in a proceeding in equity or at law. (iv) When issued in accordance with the Trust Agreement, the Seller Interest will be validly issued and entitled to the benefits of the Trust Agreement; (v) Neither the execution, delivery and performance by the Issuer of the Trust Documents or the Notes, nor the consummation by the Issuer of any of the transactions by the Issuer contemplated thereby, requires the consent or approval of, the withholding of objection on the part of, the giving of notice to, the filing, registration or qualification with, or the taking of any other action in respect of, any governmental authority or agency of the State of Illinois other than the filing of any financing statements with the Illinois Secretary of State in connection with the Indenture; (vi) Neither the execution, delivery and performance by the Issuer of the Trust Documents, nor the consummation by the Issuer of the transactions contemplated thereby, is in violation of the Trust Agreement or of any law, rule or regulation of the State of Illinois applicable to the Issuer; and (vii) With respect to the Issuer and the Collateral Certificate: (a) there is no document, stamp, exercise or other similar tax imposed by the State of Illinois upon the perfection of a security interest in the Collateral Certificate, in the transfer of the Collateral Certificate to the Issuer, or upon the issuance of the Notes; (b) there is no personal property tax imposed by the State of Illinois upon or measured by the corpus of the Issuer; and (c) the characterization of the Issuer for federal income tax purposes will be determinative of the characterization of the Issuer for Illinois income tax purposes and assuming that the Issuer has only one owner, the Issuer will not be subject to Illinois income tax or personal property replacement tax and Noteholders who are not otherwise subject to Illinois income tax will not be subject to tax by reason of their ownership of the Notes and the receipt of income therefrom. (j) The Representative shall have received an opinion of Seward & Kissel LLP, counsel to the Indenture Trustee dated the Closing Date, satisfactory in form and substance to the Representative and its counsel, to the effect that: -18- (i) The Indenture Trustee is a banking corporation organized and validly existing and in good standing under the laws of the State of New York and is authorized and qualified to accept the trusts imposed by the Indenture and to act as Indenture Trustee under the Indenture; (ii) The acknowledgment by the Indenture Trustee of the Transfer and Servicing Agreement has been duly authorized, executed and delivered by the Indenture Trustee. The Indenture Trustee has duly authorized, executed and delivered the Indenture. Assuming the due authorization, execution and delivery thereof by the other parties thereto, the Indenture is the legal, valid and binding obligation of the Indenture Trustee, enforceable against the Indenture Trustee in accordance with its terms, subject to bankruptcy and insolvency laws and general principles of equity; (iii) The Indenture Trustee has duly executed and authenticated the Notes; (iv) The Indenture Trustee is duly authorized and empowered to exercise trust powers under applicable law; (v) None of (x) the execution and authentication of the Notes, (y) the acknowledgment of the Transfer and Servicing Agreement or (z) the execution, delivery and performance of the Indenture by the Indenture Trustee conflicts with or will result in a violation of (A) any law or regulation of the United States of America or the States of New York and Illinois governing the banking or trust powers of the Indenture Trustee or (B) the Organization Certificate or Bylaws of the Indenture Trustee. (vi) No approval, authorization or other action by, or filing with, any governmental authority of the United States of America or the State of New York having jurisdiction over the banking or trust powers of the Indenture Trustee is required in connection with the execution and delivery by the Indenture Trustee of the Indenture or the performance by the Indenture Trustee of the terms of the Indenture or the acknowledgment of the Transfer and Servicing Agreement. (k) The Representative shall have received reliance letters addressed to the Representative, dated as of the Closing Date, allowing the Representative to rely on each opinion of counsel delivered to a Rating Agency, the Indenture Trustee or the Bank in connection with the issuance of the Notes. (l) The Representative shall have received evidence satisfactory to the Representative that the Class A Notes shall be rated Aaa by Moody's Investors Service, Inc., AAA by Standard & Poor's Ratings Services and AAA by Fitch, Inc.; and that the Class B -19- Notes shall be rated no lower than A2 by Moody's Investors Service, Inc., A by Standard & Poor's Ratings Services and A by Fitch, Inc. The Bank will furnish the Representative with such conformed copies of such opinions, certificates, letters and documents as the Representative reasonably request. 7. Indemnification and Contribution. (a) Spiegel and the Bank, jointly -------------------------------- and severally, will indemnify and hold harmless the Underwriters against any losses, claims, damages or liabilities, joint or several, to which the Underwriters may become subject, under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Registration Statement, the Prospectus, or any amendment or supplement thereto, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, and will reimburse the Underwriters for any legal or other expenses reasonably incurred by the Underwriters in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred; provided, --------- however, that Spiegel and the Bank will not be liable in any such case to the - ------- extent that any such loss, claim, damage or liability arises out of or is based upon an untrue statement or alleged untrue statement in or omission or alleged omission from any of such documents in reliance upon and in conformity with the Class A Underwriters' Information or the Class B Underwriters' Information; provided further, that Spiegel and the Bank will not be liable to any Underwriter under the indemnity agreement in this subsection (a) with respect to any preliminary prospectus to the extent that any loss, claim, damage or liability of such Underwriter results from the fact that such Underwriter sold Notes to a Person as to whom it is established that there was not sent or given, at or prior to written confirmation of such sale, a copy of the Prospectus (excluding documents incorporated by reference) or of the Prospectus as then amended or supplemented (excluding documents incorporated by reference) in any case where such delivery is required by the Act if Spiegel or the Bank notified the Representative in writing in accordance with Section 5(a) hereof and previously furnished copies of the Prospectus (excluding documents incorporated by reference) in the quantity requested in accordance with Section 5(d) hereof to such Underwriter and the loss, claim, damage or liability of such Underwriter results from an untrue statement or omission of a material fact contained in the preliminary prospectus and corrected in the Prospectus or the Prospectus as then amended or supplemented. (b) The Underwriters agree, severally and not jointly, to indemnify and hold harmless Spiegel and the Bank against any losses, claims, damages or liabilities to which Spiegel or the Bank may become subject, under the Act or otherwise and will reimburse any legal or other expenses reasonably incurred by Spiegel or the Bank in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of any material fact contained in the Registration Statement, the Prospectus, or any amendment or supplement thereto, or arise out of or are based upon the omission or the alleged omission -20- to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that, with respect to each of the Class A Underwriters and the Class B Underwriters, such untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with the Class A Underwriters' Information or the Class B Underwriters' Information, respectively, and will reimburse any legal or other expenses reasonably incurred by Spiegel and the Bank in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred. (d) Promptly after receipt by an indemnified party under this section of notice of the commencement of any action, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under subsection (a) or (b) above, notify the indemnifying party of the commencement thereof; provided, however, that the failure to notify an -------- ------- indemnifying party shall not relieve it from any liability which it may have under this Section 7 except to the extent it has been materially prejudiced by such failure; and provided further, however, that the failure -------- ------- ------- to notify any indemnifying party shall not relieve it from any liability which it may have to any indemnified party otherwise than under this Section 7. In case any such action is brought against any indemnified party and it notifies the indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate therein and to the extent that it may wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party will not be liable to such indemnified party under this section for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and does not include a statement as to, or an admission of, fault, culpability or failure to act by or on behalf of any indemnified party. (e) If the indemnification provided for in this section is unavailable or insufficient to hold harmless an indemnified party under subsection (a) or (b) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities referred to in subsection (a) or (b) above (i) in such proportion as is appropriate to reflect the relative benefits received by Spiegel and the Bank on the one hand and the Underwriters on the other from the offering of the Notes, or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits -21- referred to in clause (i) above but also the relative fault of Spiegel and the Bank on the one hand and the Underwriters on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities as well as any other relevant equitable considerations. The relative benefits received by Spiegel and the Bank on the one hand and the Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses) of the Class A Notes and Class B Notes received by the Bank bear to the total underwriting discounts and commissions received by the Underwriters with respect to the Class A Notes and Class B Notes. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by Spiegel and the Bank or the Underwriters and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission with respect to the Notes. The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this subsection (d) shall be deemed to include any other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim which is the subject of this subsection (d). Notwithstanding the provisions of this subsection (d), the Underwriters shall not be required to contribute any amount in excess of the amount by which the total underwriting discount as set forth on the cover page of the Prospectus Supplement exceeds the amount of damages which the Underwriters have otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission with respect to the Notes. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. (f) The obligations of Spiegel and the Bank under this Section shall be in addition to any liability which Spiegel or the Bank may otherwise have and shall extend, upon the same terms and conditions, to each Person, if any, who controls the Underwriters within the meaning of the Act; and the obligations of the Underwriters under this section shall be in addition to any liability which the Underwriters may otherwise have and shall extend, upon the same terms and conditions, to each director of Spiegel or the Bank, to each officer of the Bank who has signed the Registration Statement and to each Person, if any, who controls Spiegel or the Bank within the meaning of the Act. 8. Survival of Certain Representations and Obligations. The respective --------------------------------------------------- indemnities, agreements, representations, warranties and other statements of Spiegel and the Bank or their officers and of the Underwriters set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation, or statement as to the results thereof, made by or on behalf of the Underwriters, Spiegel, the Bank or any of their respective representatives, officers or directors or any controlling person, and will survive delivery of and payment for the Class A Notes and Class B Notes. If this Agreement is terminated or if for any reason other than default by the Underwriters the purchase of the Notes by the Underwriters is not consummated, the Bank and Spiegel shall remain responsible for the expenses to be paid by them pursuant to Section 5 and the respective -22- obligations of Spiegel, the Bank and the Underwriters pursuant to Section 7 shall remain in effect. If for any reason the purchase of the Class A Notes and Class B Notes by the Class A Underwriters and the Class B Underwriters, respectively, is not consummated other than solely because of the occurrence of any event specified in clause (iii), (iv) or (v) of Section 6(c), the Bank and Spiegel will reimburse the Underwriters for all out-of-pocket expenses reasonably incurred by them in connection with the offering of the Class A Notes and Class B Notes. 9. Computational Materials and ABS Term Sheets. (a) Each Underwriter ------------------------------------------- agrees to provide to the Bank, not less than two Business Days prior to the date on which the Bank is required to file the Prospectus Supplement pursuant to Rule 424(b), any information used by it (in such written or electronic format as required by the Bank) with respect to the offering of the Class A Notes and Class B Notes that constitutes "Computational Materials," as defined in the ----------------------- Commission's No-Action Letter, dated May 20, 1994, addressed to Kidder, Peabody Acceptance Corporation I, Kidder, Peabody & Co. Incorporated and Kidder Structured Asset Corporation (as made generally applicable to registrants, issuers and underwriters by the Commission's response to the request of the Public Securities Association dated May 27, 1994 (the "Kidder/PSA Letter")), ----------------- that is not contained in the Prospectus (without taking into account information incorporated therein by reference). (b) Each Underwriter agrees to provide to the Bank, not less than two Business Days prior to the date on which the Bank is required to file the Prospectus Supplement pursuant to Rule 424(b), any information used by it (in such written or electronic format as required by the Bank) with respect to the offering of the Class A Notes and Class B Notes that constitutes "ABS Term Sheets," as defined in the Commission's No-Action Letter, dated ---------------- February 17, 1995, addressed to the Public Securities Association, that is not contained in the Prospectus (without taking into account information incorporated therein by reference). (c) Each Underwriter severally agrees, assuming all information provided by the Bank is accurate and complete in all material respects, to indemnify and hold harmless the Bank, each of the officers and directors of the Bank and each Person who controls the Bank within the meaning of Section 15 of the Act against any and all losses, claims, damages or liabilities, joint or several, to which they may become subject under the Act or otherwise, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any untrue statement of a material fact contained in the Computational Materials or ABS Term Sheets, if any, provided by such Underwriter, or arise out of or are based upon the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, and agrees to reimburse each such indemnified party for any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending or preparing to defend any such loss, claim, damage, liability or action as such expenses are incurred. The obligations of each Underwriter under this Section 9(c) shall be in addition to any liability that such Underwriter may otherwise have. -23- (3) The Bank shall file with the Commission any Computational Materials or ABS Term Sheets, if any, provided by the Underwriters no later than the date on which such Computational Materials or ABS Term Sheets are required to be filed pursuant to the applicable No-Action Letters. The procedures set forth in Sections 7(c) and 7(d) shall be equally applicable to this Section 9(c). Notwithstanding anything in this Section 9, each Underwriter represents and warrants that it has not used any Computational Materials or ABS Term Sheets in connection with the offering of the Class A Notes or Class B Notes. 10. Obligation of the Underwriters. Each Underwriter represents and ------------------------------ agrees that it has not and will not, directly or indirectly, offer, sell or deliver any of the Class A Notes or Class B Notes or distribute the Prospectus or any other offering materials relating to the Class A Notes or Class B Notes in or from any jurisdiction except under circumstances that will, to the best of its knowledge and belief, result in compliance with any applicable laws and regulations thereof in effect on the date hereof and that, to the best of its knowledge and belief, will not impose any material obligations under laws and regulations of the subject jurisdictions that relate to the issuance of securities, as in effect on the date of this Agreement, on the Bank, Spiegel or the Issuer except as set forth herein. 11. Default by an Underwriter. If any one or more Class A Underwriters ------------------------- shall fail to purchase and pay for any of the Class A Notes agreed to be purchased by such Class A Underwriter or Class A Underwriters hereunder and such failure to purchase shall constitute a default in the performance of its or their obligations under this Agreement, the remaining Class A Underwriters shall be obligated severally to take up and pay for (in the respective proportions which the amount of Class A Notes set forth opposite their names in Schedule A hereto bear to the aggregate amount of Class A Notes set forth opposite the names of all the remaining Underwriters) the Class A Notes which the defaulting Class A Underwriter or Class A Underwriters agreed but failed to purchase; provided, however, that in the event that the aggregate amount of Class A Notes - -------- ------- which the defaulting Class A Underwriter or Class A Underwriters agreed but failed to purchase shall exceed 10% of the aggregate amount of Class A Notes set forth in Schedule A hereto, the remaining Class A Underwriters shall have the right to purchase all, but shall not be under any obligation to purchase any, of the Class A Notes, and if such nondefaulting Class A Underwriters do not purchase all the Class A Notes, this Agreement will terminate without liability to any nondefaulting Class A Underwriter, Spiegel or the Bank. In the event of a default by any Class A Underwriter as set forth in this Section 11, the Closing Date shall be postponed for such period, not exceeding seven days, as the Representative shall determine in order that the required changes in the Registration Statement and the Final Prospectus or in any other documents or arrangements may be effected. Nothing contained in this Agreement shall relieve any defaulting Class A Underwriter for its liability, if any, to Spiegel and the Bank and any nondefaulting Class A Underwriter for damages occasioned by its default hereunder. -24- 12. Notices. All communications hereunder will be in writing and, if sent ------- to the Underwriters, will be mailed, delivered or telegraphed and confirmed to: Deutsche Banc Alex. Brown Inc 31 West 52/nd/ Street New York, NY 10019 Attn.: ABS Syndicate Desk, 3/rd/ Floor 13. Counterparts. This Agreement may be executed in any number of ------------ counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement. 14. Applicable Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN -------------- ACCORDANCE WITH, THE LAWS OF THE STATE OF ILLINOIS, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. 15. Financial Services Act. Each Underwriter represents and warrants to, ---------------------- and agrees with, Spiegel and the Bank that (w) it has complied and shall comply with all applicable provisions of the Financial Services Act 1986 and the Public Offers of Securities Regulations 1995 (the "Regulations") with respect to ----------- anything done by it in relation to the Notes in, from or otherwise involving the United Kingdom; (x) it has only issued or passed on and shall only issue or pass on in the United Kingdom any document received by it in connection with the issue of the Notes to a Person who is of a kind described in Article 11(3) of the Financial Services Act 1986 (Investment Advertisements) (Exemptions) Order 1996 or who is a Person to whom the document may otherwise lawfully be issued or passed on; (y) it has not offered or sold and, during the period of six months from the date hereof, will not offer or sell any Note to Persons in the United Kingdom except to Persons whose ordinary activities involve them in acquiring, holding, managing, or disposing of investments (as principal or agent) for the purposes of their businesses or otherwise in circumstances which have not resulted and will not result in an offer to the public in the United Kingdom within the meaning of the Regulations. -25- If you are in agreement with the foregoing, please sign two counterparts hereof and return one to the Bank whereupon this letter and your acceptance shall become a binding agreement among Spiegel, the Bank and the Underwriters. Very truly yours, SPIEGEL, INC. By: /s/ John R. Steele -------------------- Name: John R. Steele Title: Treasurer FIRST CONSUMERS NATIONAL BANK By: /s/ John R. Steele -------------------- Name: John R. Steele Title: Treasurer The foregoing Agreement is hereby confirmed and accepted as of the date hereof DEUTSCHE BANC ALEX. BROWN INC as Representative of the Underwriters set forth herein By: /s/ Christopher D. Davis ------------------------- Name: Christopher D. Davis Title: Director By: /s/ Paul Vambutas ----------------- Name: Paul Vambutas Title: Vice President -26- SCHEDULE A Class A Notes -------------
Underwriters Principal Amount of ------------ Class A Notes ------------- Deutsche Banc Alex. Brown Inc $115,500,000 ------------ Banc of America Securities LLC $115,500,000 ------------ Commerzbank Capital Markets Corp. $115,500,000 ------------ Chase Securities Inc. $115,500,000 ------------ Total $462,000,000 ============
Class B Notes -------------
Underwriters Principal Amount of ------------ Class B Notes ------------- Deutsche Banc Alex. Brown Inc $63,000,000 ----------- Total $63,000,000 ===========
EX-4.1 3 0003.txt MASTER INDENTURE, AS OF MARCH 1, 2001 Exhibit 4.1 ----------- MASTER INDENTURE between FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST Issuer, and THE BANK OF NEW YORK Indenture Trustee Dated as of March 1, 2001 RECONCILIATION AND TIE BETWEEN TRUST INDENTURE ACT OF 1939 AND INDENTURE PROVISIONS/1/ Trust Indenture Act Section Indenture Section --------------- ----------------- 310(a)(1).................................... 6.11 (a)(2).................................... 6.11 (a)(3).................................... 6.10 (a)(4).................................... Not Applicable (a)(5).................................... 6.11 (b)....................................... 6.8, 6.11 (c)....................................... Not Applicable 311(a)....................................... 6.12 (b)....................................... 6.12 (c)....................................... Not Applicable 312(a)....................................... 7.1, 7.2(a) (b)....................................... 7.2(b) (c)....................................... 7.2(c) 313(a)....................................... 7.4 (b)....................................... 7.4 (c)....................................... 7.3, 7.4 (d)....................................... 7.4 314(a)....................................... 3.9, 7.3(a) (b)....................................... 3.6 (c)(1).................................... 8.9, 12.1(a) (c)(2).................................... 8.9, 12.1(a) (c)(3).................................... 8.9, 12.1(a) (d)(1).................................... 8.9, 12.1(b) (d)(2).................................... Not Applicable (d)(3).................................... Not Applicable (e)....................................... 12.1(a) 315(a)....................................... 6.1(b) (b)....................................... 6.2 (c)....................................... 6.1(c) (d)....................................... 6.1(d) (d)(1).................................... 6.1(d) (d)(2).................................... 6.1(d) (d)(3).................................... 6.1(d) (e)....................................... 5.14 316(a)(1)(A)................................. 5.12 316(a)(1)(B)................................. 5.13 316(a)(2).................................... Not Applicable 316(b)....................................... 5.8 317(a)(1).................................... 5.4 317(a)(2).................................... 5.4(d) 317(b)....................................... 5.4(a) 318(a)....................................... 12.7 /1/ This reconciliation and tie shall not, for any purpose, be deemed to be part of the within indenture. MASTER INDENTURE, dated as of March 1, 2001 (the "Indenture"), between --------- First Consumers Credit Card Master Note Trust, a trust organized under the laws of the State of Illinois (the "Issuer"), and The Bank of New York, a New York ------ banking corporation, as indenture trustee (the "Indenture Trustee"). This ----------------- Indenture may be supplemented at any time and from time to time by an indenture supplement in accordance with Article X (an "Indenture Supplement," and together --------- --------------------- with this Indenture and any amendments, the "Agreement"). If a conflict exists --------- between the terms and provisions of this Indenture and any Indenture Supplement, the terms and provisions of the Indenture Supplement shall be controlling with respect to the related Series. PRELIMINARY STATEMENT The Issuer has duly authorized the execution and delivery of this Indenture to provide for an issue of its asset backed notes as provided in this Indenture. All covenants and agreements made by the Issuer herein are for the benefit and security of the Noteholders. The Issuer is entering into this Indenture, and the Indenture Trustee is accepting the trusts created hereby, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged. Simultaneously with the delivery of this Indenture, the Issuer is entering into a Transfer and Servicing Agreement with First Consumers National Bank, a national banking association, as Seller and Servicer, pursuant to which (a) the Seller will convey to the Issuer all of its right, title and interest in, to and under (i) the Collateral Certificate, which the Seller will have received from First Consumers Master Trust, and (ii) on and after the FCMT Termination Date, the Receivables arising in the Accounts from time to time and (b) the Servicer will agree to service the Receivables and make collections thereon on behalf of the Noteholders. GRANTING CLAUSE The Issuer hereby Grants to the Indenture Trustee, for the benefit of the Holders of the Notes and the Enhancement Providers, all of the Issuer's right, title and interest, whether now owned or hereafter acquired, in, to and under (a) the Collateral Certificate, (b) the Receivables, (c) Recoveries related to and all money, instruments, investment property and other property distributed or distributable in respect of (together with all earnings, dividends, distributions, income, issues, and profits relating to) the Receivables pursuant to the terms of the Transfer and Servicing Agreement, this Indenture and any Indenture Supplement; (d) the rights to receive certain amounts paid or payable as Interchange (if and to the extent provided for in any Indenture Supplement), (e) all rights to security for any Receivables (including rights to bank accounts or certificates of deposit pledged as collateral), (f) all Permitted Investments and all money, investment property, instruments and other property on deposit from time to time in, credited to or related to the Collection Account, the Series Accounts and the Excess Funding Account (including any subaccounts of any such account), and in all interest, dividends, earnings, income and other distributions from time to time received, receivable or otherwise distributed or distributable thereto or in respect thereof (including any accrued discount realized on liquidation of any investment purchased at a discount); (g) all rights, remedies, powers, privileges and claims of the Issuer under or with respect to any Series Enhancement and the Transfer and Servicing Agreement (whether arising pursuant to the terms of the Transfer and Servicing Agreement or otherwise available to the Issuer at law or in equity), including the rights of the Issuer to enforce the Transfer and Servicing Agreement, and to give or withhold any and all consents, requests, notices, directions, approvals, extensions or waivers under or with respect to the Transfer and Servicing Agreement to the same extent as the Issuer could but for the assignment and security interest granted to the Indenture Trustee for the benefit of the Noteholders; (h) all proceeds of any Credit Insurance policies relating to the Receivables; (i) all proceeds of any derivative contracts between the Issuer or FCNB and a counterparty, as described in any Indenture Supplement; (j) all money, accounts, general intangibles, chattel paper, instruments, documents, goods, investment property, deposit accounts, certificates of deposit, letters of credit, and advices of credit consisting of, arising from or related to the foregoing; (k) all other property of the Issuer; (l) all present and future claims, demands, causes and choses in action in respect of any or all of the foregoing and all payments on or under and all proceeds of every kind and nature whatsoever in respect of any or all of the foregoing, including all proceeds, products, rents, receipts or profits of the conversion, voluntary or involuntary, into cash or other property, all cash and non-cash proceeds, and other property consisting of, arising from or relating to all or any part of any of the foregoing; and (m) any proceeds of the foregoing (collectively, the "Collateral"). ---------- LIMITED RECOURSE The obligation of the Issuer to make payments of principal, interest and other amounts in respect of the Notes is limited by recourse only to the Collateral. ARTICLE I DEFINITIONS Section 1.1. Definitions. ----------- Capitalized terms used herein are defined in Annex A. ------- Section 1.2. Other Definitional Provisions. ----------------------------- 2 (a) All terms defined directly or by reference in this Indenture shall have the defined meanings when used in any certificate or other document delivered pursuant hereto unless otherwise defined therein. For purposes of this Indenture and all such certificates and other documents, unless the context otherwise requires: (i) accounting terms not otherwise defined in this Indenture, and accounting terms partly defined in this Indenture to the extent not defined, shall have the respective meanings given to them under generally accepted accounting principles; (ii) terms defined in Article 9 of the UCC as in effect in the State of Illinois and not otherwise defined in this Indenture are used as defined in that Article; (iii) any reference to each Rating Agency shall only apply to any specific rating agency if such rating agency is then rating any outstanding Series; (iv) references to any amount as on deposit or outstanding on any particular date means such amount at the close of business on such day; (v) the words "hereof," "herein" and "hereunder" and words of similar import refer to this Indenture (or the certificate or other document in which they are used) as a whole and not to any particular provision of this Indenture (or such certificate or document); (vi) references to any Section, Schedule or Exhibit are references to Sections, Schedules and Exhibits in or to this Indenture (or the certificate or other document in which the reference is made), and references to any paragraph, Section, clause or other subdivision within any Section or definition refer to such paragraph, subsection, clause or other subdivision of such Section or definition; (vii) the term "including" means "including without limitation"; (viii) references to any law or regulation refer to that law or regulation as amended from time to time and include any successor law or regulation; (ix) references to any Person include that Person's successors and assigns; and (x) headings are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof. (b) Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings: "indenture securities" means the Notes -------------------- "indenture security holder" means a Noteholder ------------------------- "indenture to be qualified" means this Indenture ------------------------- "indenture trustee" or "institutional trustee" means the Indenture ------------------ ---------------------- Trustee "obligor" on the indenture securities means the Issuer and any other ------- obligor on the indenture securities 3 All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by Commission rule have the meanings assigned to them by such definitions. ARTICLE II THE NOTES Section 2.1. Form Generally. Any Series or Class of Notes, together with -------------- the Indenture Trustee's certificate of authentication related thereto, may be issued in bearer form (the "Bearer Notes") with attached interest coupons and a ------------ special coupon (collectively, the "Coupons") or in fully registered form (the ------- "Registered Notes") and shall be in substantially the form of an exhibit to the ---------------- related Indenture Supplement with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture or such Indenture Supplement, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon, as may, consistently herewith, be determined by the officers executing such Notes, as evidenced by their execution of such Notes. Any portion of the text of any Note may be set forth on the reverse thereof, with an appropriate reference thereto on the face of the Note. The terms of any Notes set forth in an exhibit to the related Indenture Supplement are part of the terms of this Indenture, as applicable. The Definitive Notes shall be typewritten, printed, lithographed or engraved or produced by any combination of these methods, all as determined by the officers executing such Notes, as evidenced by their execution of such Notes. Each Note will be dated the Closing Date and each Definitive Note will be dated as of the date of its authentication. Section 2.2. Denominations. Except as otherwise specified in the related ------------- Indenture Supplement and the Notes, each class of Notes of each Series shall be issued in fully registered form in minimum amounts of $1,000 and in integral multiples of $1,000 in excess thereof (except that one Note of each Class may be issued in a different amount, so long as such amount exceeds the applicable minimum denomination for such Class), and shall be issued upon initial issuance as one or more Notes in an aggregate original principal amount equal to the applicable Collateral Amount for such Class or Series. Section 2.3. Execution, Authentication and Delivery. Each Note shall be -------------------------------------- executed by manual or facsimile signature on behalf of the Issuer by an Authorized Officer. 4 Notes bearing the manual or facsimile signature of an individual who was, at the time when such signature was affixed, authorized to sign on behalf of the Issuer shall not be rendered invalid, notwithstanding the fact that such individual ceased to be so authorized prior to the authentication and delivery of such Notes or does not hold such office at the date of issuance of such Notes. At any time and from time to time after the execution and delivery of this Indenture, the Issuer may deliver Notes executed by the Issuer to the Indenture Trustee for authentication and delivery, and the Indenture Trustee shall authenticate at the written direction of the Issuer and deliver such Notes as provided in this Indenture or the related Indenture Supplement and not otherwise. No Note shall be entitled to any benefit under this Indenture or the applicable Indenture Supplement or be valid or obligatory for any purpose, unless there appears on such Note a certificate of authentication substantially in the form provided for herein or in the related Indenture Supplement executed by or on behalf of the Indenture Trustee by the manual signature of a duly authorized signatory, and such certificate upon any Note shall be conclusive evidence, and the only evidence, that such Note has been duly authenticated and delivered hereunder. Section 2.4. Authenticating Agent. -------------------- (a) The Indenture Trustee, at the expense of the Servicer, may appoint one or more authenticating agents with respect to the Notes which shall be authorized to act on behalf of the Indenture Trustee in authenticating the Notes in connection with the issuance, delivery, registration of transfer, exchange or repayment of the Notes. Whenever reference is made in this Indenture to the authentication of Notes by the Indenture Trustee or the Indenture Trustee's certificate of authentication, such reference shall be deemed to include authentication on behalf of the Indenture Trustee by an authenticating agent and a certificate of authentication executed on behalf of the Indenture Trustee by an authenticating agent. Each authenticating agent must be acceptable to the Issuer and the Servicer. (b) Any institution succeeding to the corporate agency business of an authenticating agent shall continue to be an authenticating agent without the execution or filing of any power or any further act on the part of the Indenture Trustee or such authenticating agent. (c) An authenticating agent may at any time resign by giving written notice of resignation to the Indenture Trustee, the Issuer and the Servicer. The Indenture Trustee may at any time terminate the agency of an authenticating agent by giving notice of termination to such authenticating agent and to the Issuer and the Servicer. Upon receiving such a notice of resignation or upon such a termination, or 5 in case at any time an authenticating agent shall cease to be acceptable to the Indenture Trustee or the Issuer and the Servicer, the Indenture Trustee may promptly appoint a successor authenticating agent. Any successor authenticating agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an authenticating agent. No successor authenticating agent shall be appointed unless acceptable to the Issuer and the Servicer. (d) The Issuer agrees to pay to each authenticating agent from time to time reasonable compensation for its services under this Section 2.4. ------------ (e) The provisions of Sections 6.1 and 6.4 shall be applicable to any ------------ --- authenticating agent. (f) Pursuant to an appointment made under this Section 2.4, the Notes may ----------- have endorsed thereon, in lieu of or in addition to the Indenture Trustee's certificate of authentication, an alternative certificate of authentication in substantially the following form: "This is one of the Notes described in the within-mentioned Agreement. - -------------------------- - -------------------------- as Authenticating Agent for the Indenture Trustee By: __________________________ "Authorized Signatory" Section 2.5. Registration of and Limitations on Transfer and Exchange of ----------------------------------------------------------- Notes. The Issuer shall cause to be kept a register (the "Note Register") in - ----- ------------- which the Issuer shall provide for the registration of Notes and the registration of transfers of Notes. The Indenture Trustee initially shall be the transfer agent and registrar (in such capacity, the "Transfer Agent and ------------------ Registrar") for the purpose of registering Notes and transfers of Notes as - --------- herein provided. Upon any resignation of any Transfer Agent and Registrar, the Issuer shall promptly appoint a successor or, if it elects not to make such an appointment, assume the duties of Transfer Agent and Registrar. If a Person other than the Indenture Trustee is appointed by the Issuer as Transfer Agent and Registrar, the Issuer will give the Indenture Trustee prompt 6 written notice of the appointment of a Transfer Agent and Registrar and of the location, and any change in the location, of the Transfer Agent and Registrar and Note Register. The Indenture Trustee shall have the right to inspect the Note Register at all reasonable times and to obtain copies thereof, and the Indenture Trustee shall have the right to conclusively rely upon a certificate executed on behalf of the Transfer Agent and Registrar by an officer thereof as to the names and addresses of the Noteholders and the principal amounts and numbers of such Notes. Upon surrender for registration of transfer of any Note at the office or agency of the Transfer Agent and Registrar, to be maintained as provided in Section 3.2, if the requirements of Section 8-401 of the UCC are met as - ----------- certified by the Administrator to the Indenture Trustee, the Issuer shall execute, and upon receipt of such surrendered Note the Indenture Trustee shall authenticate and deliver to the Noteholder, in the name of the designated transferee or transferees, one or more new Notes (of the same Series and Class) in any authorized denominations of like aggregate principal amount. At the option of a Noteholder, Notes may be exchanged for other Notes (of the same Series and Class) in any authorized denominations and of like aggregate principal amount, upon surrender of such Notes to be exchanged at the office or agency of the Transfer Agent and Registrar. Whenever any Notes are so surrendered for exchange, if the requirements of Section 8-401 of the UCC are met as certified by the Administrator to the Indenture Trustee, the Issuer shall execute, and upon receipt of such surrendered Note the Indenture Trustee shall authenticate and deliver to the Noteholder, the Notes which the Noteholder making the exchange is entitled to receive. All Notes issued upon any registration of transfer or exchange of Notes shall evidence the same obligations, evidence the same debt, and be entitled to the same rights and privileges under this Indenture, as the Notes surrendered upon such registration of transfer or exchange. Every Note presented or surrendered for registration of transfer or exchange shall be duly endorsed by, or be accompanied by a written instrument of transfer in a form satisfactory to the Indenture Trustee duly executed by, the Noteholder thereof or its attorney-in-fact duly authorized in writing, and by such other documents as the Indenture Trustee may reasonably require. Any Note held by the Seller at any time after the date of its initial issuance may be transferred or exchanged only upon the delivery to the Owner Trustee and the Indenture Trustee of a Tax Opinion dated as of the date of such transfer or exchange, as the case may be, with respect to such transfer or exchange. 7 The registration of transfer of any Note shall be subject to the additional requirements, if any, set forth in the related Indenture Supplement. No service charge shall be made for any registration of transfer or exchange of Notes, but the Issuer and the Transfer Agent and Registrar may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of such Notes. All Notes surrendered for registration of transfer and exchange shall be canceled by the Issuer and delivered to the Indenture Trustee for subsequent destruction without liability on the part of either. The Indenture Trustee shall destroy the Global Note upon its exchange in full for Definitive Notes and shall deliver a certificate of destruction to the Seller. Such certificate shall also state that a certificate or certificates of each Foreign Clearing Agency referred to in the applicable Indenture Supplement was received with respect to each portion of the Global Note exchanged for Definitive Notes. The preceding provisions of this Section 2.5 notwithstanding, the Issuer ----------- shall not be required to make, and Transfer Agent and Registrar need not register, transfers or exchanges of Notes for a period of twenty (20) days preceding the due date for any payment with respect to the Note. If and so long as any Series of Notes are listed on the Luxembourg Stock Exchange and such exchange shall so require, the Issuer shall appoint a co- transfer agent and co-registrar in Luxembourg or another European city. Any reference in this Indenture to the Transfer Agent and Registrar shall include any co-transfer agent and co-registrar unless the context otherwise requires. The Indenture Trustee will enter into any appropriate agency agreement with any co-transfer agent and co-registrar not a party to this Indenture, which will implement the provisions of this Indenture that relate to such agent. Section 2.6. Mutilated, Destroyed, Lost or Stolen Notes. If (a) any ------------------------------------------ mutilated Note is surrendered to the Indenture Trustee, or the Indenture Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Note, and (b) in case of destruction, loss, or theft there is delivered to the Indenture Trustee such security or indemnity as may be required by it to hold the Issuer, the Noteholders and the Indenture Trustee harmless, then, in the absence of notice to the Issuer, the Transfer Agent and Registrar or the Indenture Trustee that such Note has been acquired by a protected purchaser (as defined in Section 8-303 of the UCC as in effect in the State of Illinois), the Issuer shall execute, and the Indenture Trustee shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement Note of like tenor (including the same date of issuance) and principal amount, bearing a number not contemporaneously 8 outstanding; provided, however, that if any such mutilated, destroyed, lost or -------- ------- stolen Note shall have become or within seven (7) days shall be due and payable, or shall have been selected or called for redemption, instead of issuing a replacement Note, the Issuer may pay such Note without surrender thereof, except that any mutilated Note shall be surrendered. If, after the delivery of such replacement Note or payment of a destroyed, lost or stolen Note pursuant to the proviso to the preceding sentence, a protected purchaser (as defined in Section 8-303 of the UCC as in effect in the State of Illinois) of the original Note in lieu of which such replacement Note was issued presents for payment such original Note, the Issuer and the Indenture Trustee shall be entitled to recover such replacement Note (or such payment) from the Person to whom it was delivered or any Person taking such replacement Note from such Person to whom such replacement Note was delivered or any assignee of such Person, except a protected purchaser, and shall be entitled to recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or expense incurred by the Issuer or the Indenture Trustee in connection therewith. Upon the issuance of any replacement Note under this Section 2.6, the ----------- Issuer may require the payment by the Holder of such Note of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other reasonable expenses (including the fees and expenses of the Indenture Trustee or the Transfer Agent and Registrar) connected therewith. Every replacement Note issued pursuant to this Section 2.6 in replacement ----------- of any mutilated, destroyed, lost or stolen Note shall constitute complete and indefeasible evidence of an obligation of the Trust, as if originally issued, whether or not the mutilated, destroyed, lost or stolen Note shall be found at any time, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Notes duly issued hereunder. The provisions of this Section 2.6 are exclusive and shall preclude (to the ----------- extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes. Section 2.7. Persons Deemed Owners. Prior to due presentment for --------------------- registration of transfer of any Note, the Issuer, the Seller, the Indenture Trustee and any agent of the Issuer, the Seller or the Indenture Trustee shall treat the Person in whose name any Note is registered as the owner of such Note for the purpose of receiving distributions pursuant to the terms of the applicable Indenture Supplement and for all other purposes whatsoever, whether or not such Note is overdue, and neither the Issuer, the Seller, the Indenture Trustee nor any agent of the Issuer, the Seller or the Indenture Trustee shall be affected by any notice to the contrary. Section 2.8. Appointment of Paying Agent. --------------------------- 9 (a) The Issuer reserves the right at any time to vary or terminate the appointment of a Paying Agent for the Notes, and to appoint additional or other Paying Agents, provided that it will at all times maintain the Indenture Trustee as a Paying Agent. If and so long as any Notes are listed on the Luxembourg Stock Exchange and such exchange shall so require, the Indenture Trustee will appoint a co-paying agent in Luxembourg or another European city. The Indenture Trustee will enter into any appropriate agency agreement with any co-paying agent not a party to this Indenture, which will implement the provisions of this Indenture that relate to such agent. Notice of all changes in the identity or specified office of a Paying Agent will be delivered promptly to the Noteholders by the Indenture Trustee. (b) The Indenture Trustee shall cause each Paying Agent (other itself) to execute and deliver to the Indenture Trustee an instrument in which such Paying Agent shall agree with the Indenture Trustee that such Paying Agent will hold all sums, if any, held by it for payment to the Noteholders in trust for the benefit of the Noteholders entitled thereto until such sums shall be paid to such Noteholders and shall agree, and if the Indenture Trustee is the Paying Agent it hereby agrees, that it shall comply with all requirements of the Code regarding the withholding by the Indenture Trustee of payments in respect of federal income taxes due from the Note Owners. Section 2.9. Access to List of Noteholders' Names and Addresses. -------------------------------------------------- (a) The Issuer will furnish or cause to be furnished to the Indenture Trustee, the Servicer or the Paying Agent, within five (5) Business Days after receipt by the Issuer of a written request therefor from the Indenture Trustee, the Servicer or the Paying Agent, respectively, a list of the names and addresses of the Noteholders. Unless otherwise provided in the related Indenture Supplement, the Holders of not less than 10% of the principal balance of the Outstanding Notes of any Series (the "Applicants") may apply in writing to the ---------- Indenture Trustee, and if such application states that the Applicants desire to communicate with other Noteholders of any Series with respect to their rights under this Indenture or under the Notes and is accompanied by a copy of the communication which such Applicants propose to transmit, then the Indenture Trustee, after having been adequately indemnified by such Applicants for its costs and expenses, shall afford or shall cause the Transfer Agent and Registrar to afford such Applicants access during normal business hours to the most recent list of Noteholders held by the Indenture Trustee and shall give the Servicer notice that such request has been made, within five (5) Business Days after 10 the receipt of such application. Such list shall be as of a date no more than forty-five (45) days prior to the date of receipt of such Applicants' request. (b) Every Noteholder, by receiving and holding a Note, agrees that none of the Issuer, the Indenture Trustee, the Transfer Agent and Registrar and the Servicer or any of their respective agents and employees shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the Noteholders hereunder, regardless of the sources from which such information was derived. Section 2.10. Cancellation. All Notes surrendered for ------------ payment, registration of transfer, exchange or redemption shall, if surrendered to any Person other than the Indenture Trustee, be delivered to the Indenture Trustee and shall be promptly canceled by it. The Issuer may at any time deliver to the Indenture Trustee for cancellation any Notes previously authenticated and delivered hereunder which the Issuer may have acquired in any lawful manner whatsoever, and all Notes so delivered shall be promptly canceled by the Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for any Notes canceled as provided in this Section 2.10, except as ------------ expressly permitted by this Indenture. All canceled Notes held by the Indenture Trustee shall be destroyed unless the Issuer shall direct by a timely order that they be returned to it. Section 2.11. [Reserved] ------------------------- Section 2.12. New Issuances. ------------- (a) Pursuant to one or more Indenture Supplements, the Seller may from time to time direct the Owner Trustee, on behalf of the Issuer, to issue one or more new Series of Notes (a "New Issuance"). ------------ The Notes of all outstanding Series shall be equally and ratably entitled as provided herein to the benefits of this Indenture without preference, priority or distinction, all in accordance with the terms and provisions of this Indenture and the applicable Indenture Supplement except, with respect to any Series or Class, as provided in the related Indenture Supplement. Interest on and principal of the Notes of each outstanding Series shall be paid as specified in the Indenture Supplement relating to such outstanding Series. (b) On or before the Closing Date relating to any new Series of Notes, the parties hereto will execute and deliver an Indenture Supplement which will specify the Principal Terms of such Series. The terms of such Indenture Supplement may modify or amend the terms of this Indenture solely as applied to such new Series. The obligation of the Owner Trustee to execute, on behalf of the Issuer, the Notes of any Series and of the Indenture Trustee to authenticate such Notes (other than any Series issued pursuant to an Indenture Supplement dated as of the date hereof) and to 11 execute and deliver the related Indenture Supplement is subject to the satisfaction of the following conditions: (i) on or before the fifth Business Day immediately preceding the Closing Date the Seller shall have given the Owner Trustee, the Indenture Trustee, the Servicer and each Rating Agency notice (unless such notice requirement is otherwise waived) of such issuance and the Closing Date; (ii) the Seller shall have delivered to the Owner Trustee and the Indenture Trustee any related Indenture Supplement, in form satisfactory to the Owner Trustee and the Indenture Trustee, executed by each party hereto (other than the Indenture Trustee); (iii) the Seller shall have delivered to the Owner Trustee and the Indenture Trustee any related Enhancement Agreement executed by the Seller and the Series Enhancer; (iv) the Rating Agency Condition shall have been satisfied with respect to such issuance; (v) such issuance will not result in any Adverse Effect and the Seller shall have delivered to the Owner Trustee and the Indenture Trustee an Officer's Certificate, dated the Closing Date to the effect that the Seller reasonably believes that such issuance will not, based on the facts known to such officer at the time of such certification, have an Adverse Effect; (vi) the Seller shall have delivered to the Owner Trustee and the Indenture Trustee (with a copy to each Rating Agency) (A) an Opinion of Counsel, dated the Closing Date with respect to such issuance, to the effect that, except as otherwise stated in the related Indenture Supplement, the Notes of the new Series will be characterized as debt for federal income tax purposes and (B) a Tax Opinion, dated the Closing Date with respect to such issuance; and (vii) the Aggregate Principal Balance shall not be less than the Minimum Aggregate Principal Balance as of the Closing Date and after giving effect to such issuance. (c) Upon satisfaction of the above conditions, pursuant to Section 2.3, the Owner Trustee, on behalf of the Issuer, shall ----------- execute and the Indenture Trustee shall upon written direction of the Issuer authenticate and deliver the Notes of such Series as provided in this Indenture and the applicable Indenture Supplement. 12 (d) The Issuer may direct the Indenture Trustee in writing to deposit the net proceeds from any New Issuance in the Excess Funding Account. The Issuer may also specify that on any Transfer Date the proceeds from the sale of any new Series may be withdrawn from the Excess Funding Account and treated as Shared Principal Collections. Section 2.13. Book-Entry Notes. Unless otherwise provided in ---------------- any related Indenture Supplement, the Notes, upon original issuance, shall be issued in the form of typewritten or printed Notes representing the Book-Entry Notes to be delivered to the depository specified in such Indenture Supplement which shall be the Clearing Agency or Foreign Clearing Agency, by or on behalf of such Series. The Notes of each Series shall, unless otherwise provided in the related Indenture Supplement, initially be registered in the Note Register in the name of the nominee of the Clearing Agency or Foreign Clearing Agency for such Book-Entry Notes and shall be delivered to the Indenture Trustee or, pursuant to such Clearing Agency's or Foreign Clearing Agency's instructions held by the Indenture Trustee's agent as custodian for the Clearing Agency or Foreign Clearing Agency. Unless and until Definitive Notes are issued under the limited circumstances described in Section 2.15, no Note Owner shall be ------------ entitled to receive a Definitive Note representing such Note Owner's interest in such Note. Unless and until Definitive Notes have been issued to the Note Owners pursuant to Section 2.15: ------------ (a) the provisions of this Section 2.13 shall be in full ------------ force and effect with respect to each such Series; (b) the Indenture Trustee shall be entitled to deal with the Clearing Agency or Foreign Clearing Agency and the Clearing Agency Participants for all purposes of this Indenture (including the payment of principal of and interest on the Notes of each such Series) as the authorized representatives of the Note Owners; (c) to the extent that the provisions of this Section 2.13 ------------ conflict with any other provisions of this Indenture, the provisions of this Section 2.13 shall control with respect to each such Series; ------------ (d) the rights of Note Owners of each such Series shall be exercised only through the Clearing Agency or Foreign Clearing Agency and the applicable Clearing Agency Participants and shall be limited to those established by law and agreements between such Note Owners and the Clearing Agency or Foreign Clearing Agency and/or the Clearing Agency Participants. Pursuant to the depository agreement applicable to a Series, unless and until Definitive Notes of such Series are issued pursuant to Section 2.15, the initial Clearing Agency shall make book- ------------ entry transfers 13 among the Clearing Agency Participants and receive and transmit distributions of principal and interest on the Notes to such Clearing Agency Participants; and (e) whenever this Indenture requires or permits actions to be taken based upon instructions or directions of the Holders of Notes representing a specified percentage of the Outstanding Amount, the Clearing Agency or Foreign Clearing Agency shall be deemed to represent such percentage only to the extent that they have received instructions to such effect from the Note Owners and/or Clearing Agency Participants owning or representing, respectively, such required percentage of the beneficial interest in the Notes and has delivered such instructions to the Indenture Trustee. Section 2.14. Notices to Clearing Agency or Foreign Clearing ---------------------------------------------- Agency. Whenever a notice or other communication to the Noteholders is ------ required under this Indenture, unless and until Definitive Notes shall have been issued to Note Owners pursuant to Section 2.15, the Indenture ------------ Trustee shall give all such notices and communications specified herein to be given to Noteholders to the Clearing Agency or Foreign Clearing Agency, as applicable, and shall have no obligation to the Note Owners. Section 2.15. Definitive Notes. If (i) (A) the Seller advises ---------------- the Indenture Trustee in writing that the Clearing Agency is no longer willing or able to discharge properly its responsibilities as Clearing Agency with respect to the Book-Entry Notes of a given Series and (B) the Indenture Trustee or Issuer is unable to locate and reach an agreement on satisfactory terms with a qualified successor, (ii) the Seller, at its option, advises the Indenture Trustee in writing that it elects to terminate the book-entry system through the Clearing Agency with respect to such Series or (iii) after the occurrence of a Servicer Default, Note Owners of Notes evidencing more than 50% of the principal balance of the Outstanding Notes (or such other percentage as specified in the related Indenture Supplement) of such Series advise the Indenture Trustee and the applicable Clearing Agency through the applicable Clearing Agency Participants in writing that the continuation of a book-entry system is no longer in the best interests of the Note Owners of such Series, the Clearing Agency shall notify all Note Owners of such Series of the occurrence of such event and of the availability of Definitive Notes to Note Owners of such Series requesting the same. Upon surrender to the Indenture Trustee of the Notes of such Series, accompanied by registration instructions from the applicable Clearing Agency, the Issuer shall execute and the Indenture Trustee shall authenticate Definitive Notes of such Series and shall recognize the registered holders of such Definitive Notes as Noteholders under this Indenture. Neither the Issuer nor the Indenture Trustee shall be liable for any delay in delivery of such instructions, and the Issuer and the Indenture Trustee may conclusively rely on, and shall be fully protected in relying on, such instructions. Upon the issuance of Definitive Notes of such Series, all references herein to obligations imposed upon or to be performed by the applicable Clearing Agency or Foreign 14 Clearing Agency shall be deemed to be imposed upon and performed by the Indenture Trustee, to the extent applicable with respect to such Definitive Notes, and the Indenture Trustee shall recognize the registered holders of the Definitive Notes of such Series as Noteholders of such Series hereunder. Definitive Notes will be transferable and exchangeable at the offices of the Transfer Agent and Registrar. Section 2.16. Global Note. If specified in the related ----------- Indenture Supplement for any Series, Notes may be initially issued in the form of a single temporary Global Note (the "Global Note") in ----------- bearer form, without interest coupons, in the denomination of the initial principal amount and substantially in the form attached to the related Indenture Supplement. Unless otherwise specified in the related Indenture Supplement, the provisions of this Section 2.16 shall apply ------------ to such Global Note. The Global Note will be authenticated by the Indenture Trustee upon the same conditions, in substantially the same manner and with the same effect as the Definitive Notes. The Global Note may be exchanged in the manner described in the related Indenture Supplement for Registered Notes or Bearer Notes in definitive form. Except as otherwise specifically provided in the Indenture Supplement, any Notes that are issued in bearer form pursuant to this Indenture shall be issued in accordance with the requirements of Code section 163(f)(2). Section 2.17. Meetings of Noteholders. To the extent provided ----------------------- by the Indenture Supplement for any Series issued in whole or in part in Bearer Notes, the Servicer or the Indenture Trustee may at any time call a meeting of the Noteholders of such Series, to be held at such time and at such place as the Servicer and the Indenture Trustee, as the case may be, shall determine, for the purpose of approving a modification or amendment to, or obtaining a waiver of, any covenant or condition set forth in this Indenture with respect to such Series or in the Notes of such Series, subject to Article X. --------- Section 2.18. Uncertificated Classes. Notwithstanding anything ---------------------- to the contrary contained in this Article II or in Article XI, unless ---------- ---------- otherwise specified in any Indenture Supplement, any provisions contained in this Article II and in Article XI relating to the ---------- ---------- registration, form, execution, authentication, delivery, presentation, cancellation and surrender of Notes shall not be applicable to any uncertificated Notes, provided, however, that, except as otherwise -------- ------- specifically provided in the Indenture Supplement, any such uncertificated Notes shall be issued in "registered form" within the meaning of Code section 163(f)(1). ARTICLE III REPRESENTATIONS AND COVENANTS OF ISSUER Section 3.1. Payment of Principal and Interest. --------------------------------- 15 (a) The Issuer will duly and punctually pay principal and interest in accordance with the terms of the Notes as specified in the relevant Indenture Supplement. (b) The Noteholders of a Series as of the Record Date in respect of a Distribution Date shall be entitled to the interest accrued and payable and principal payable on such Distribution Date as specified in the related Indenture Supplement. All payment obligations under a Note are discharged to the extent such payments are made to the Noteholder of record. Section 3.2. Maintenance of Office or Agency. The Issuer will ------------------------------- maintain an office or agency within the State of New York and such other locations as may be set forth in an Indenture Supplement where Notes may be presented or surrendered for payment, where Notes may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Issuer in respect of the Notes and this Indenture may be served. The Issuer hereby initially appoints the Indenture Trustee at its Corporate Trust Office to serve as its agent for the foregoing purposes. The Issuer will give prompt written notice to the Indenture Trustee and the Noteholders of the location, and of any change in the location, of any such office or agency. If at any time the Issuer shall fail to maintain any such office or agency or shall fail to furnish the Indenture Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office, and the Issuer hereby appoints the Indenture Trustee at its Corporate Trust Office as its agent to receive all such presentations, surrenders, notices and demands. Section 3.3. Money for Note Payments to Be Held in Trust. As ------------------------------------------- specified in Section 8.3(a) and (b) herein and in the related Indenture -------------- --- Supplement, all payments of amounts due and payable with respect to the Notes which are to be made from amounts withdrawn from the Collection Account and the Excess Funding Account shall be made on behalf of the Issuer by the Indenture Trustee or by the Paying Agent, and no amounts so withdrawn from the Collection Account or the Excess Funding Account shall be paid over to or at the direction of the Issuer except as provided in this Section 3.3 and in the related Indenture Supplement. ----------- The Issuer will cause each Paying Agent other than the Indenture Trustee to execute and deliver to the Indenture Trustee an instrument in which such Paying Agent shall agree with the Indenture Trustee (and if the Indenture Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions of this Section 3.3, that such ----------- Paying Agent, in acting as Paying Agent, is an express agent of the Issuer and, further, that such Paying Agent will: 16 (i) hold all sums held by it for the payment of amounts due with respect to the Notes in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided and pay such sums to such Persons as herein provided; (ii) give a Trustee Officer of the Indenture Trustee written notice of any default by the Issuer (or any other obligor upon the Notes) of which it has actual knowledge in the making of any payment required to be made with respect to the Notes; (iii) at any time during the continuance of any such default, upon the written request of the Indenture Trustee, forthwith pay to the Indenture Trustee all sums so held in trust by such Paying Agent; (iv) immediately resign as a Paying Agent and forthwith pay to the Indenture Trustee all sums held by it in trust for the payment of Notes if at any time it ceases to meet the standards required to be met by a Paying Agent at the time of its appointment; and (v) comply with all requirements of the Code with respect to the withholding from any payments made by it on any Notes of any applicable withholding taxes imposed thereon and with respect to any applicable reporting requirements in connection therewith. The Issuer may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, by Issuer Order direct any Paying Agent to pay to the Indenture Trustee all sums held in trust by such Paying Agent, such sums to be held by the Indenture Trustee upon the same trusts as those upon which such sums were held by such Paying Agent; and upon such payment by any Paying Agent to the Indenture Trustee, such Paying Agent shall be released from all further liability with respect to such sums. Section 3.4. Existence. The Issuer will keep in full effect --------- its existence, rights and franchises as a common law trust under the laws of the State of Illinois (unless it becomes, or any successor Issuer hereunder is or becomes, organized under the laws of any other State or of the United States of America, in which case the Issuer will keep in full effect its existence, rights and franchises under the laws of such other jurisdiction) and will obtain and preserve its qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of this Indenture, the Notes, the Collateral and each other related instrument or agreement. 17 Section 3.5. Protection of Collateral. The Issuer will from ------------------------ time to time prepare, or cause to be prepared, execute and deliver all such supplements and amendments hereto and all such financing statements, continuation statements, instruments of further assurance and other instruments, and will take such other action necessary or advisable to: (a) grant more effectively all or any portion of the Collateral as security for the Notes; (b) maintain or preserve the lien (and the priority thereof) of this Indenture or to carry out more effectively the purposes hereof; (c) perfect, publish notice of, or protect the validity of any Grant made or to be made under this Indenture; (d) enforce any of the Collateral; or (e) preserve and defend title to the Collateral securing the Notes and the rights therein of the Indenture Trustee and the Noteholders secured thereby against the claims of all persons and parties. The Issuer hereby designates the Indenture Trustee its agent and attorney-in-fact to execute any financing statement, continuation statement or other instrument required pursuant to this Section 3.5, ----------- but the Indenture Trustee shall not have any obligation to take any such action unless instructed to do so by Noteholders in accordance with the terms hereof. The Issuer shall pay or cause to be paid any taxes levied on all or any part of the Receivables securing the Notes. Section 3.6. Opinions as to Collateral. ------------------------- (a) On the Closing Date relating to any new Series of Notes, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel satisfactory to the Rating Agencies either stating that, in the opinion of such counsel, such action has been taken to perfect the lien and security interest of this Indenture, including with respect to the recording and filing of this Indenture, any indentures supplemental hereto, and any other requisite documents, and with respect to the execution and filing of any financing statements and continuation statements, as are so necessary and reciting the details of such action, or stating that, in the opinion of such counsel, no such action is necessary to maintain the perfection of such lien and security interest. 18 (b) On or before May 30 in each calendar year, beginning in 2001, the Issuer shall furnish to the Indenture Trustee an Opinion of Counsel satisfactory to the Rating Agencies either stating that, in the opinion of such counsel, such action has been taken to perfect the lien and security interest of this Indenture, including with respect to the recording, filing, re-recording and refiling of this Indenture, any indentures supplemental hereto and any other requisite documents and with respect to the execution and filing of any financing statements and continuation statements as is so necessary and reciting the details of such action or stating that in the opinion of such counsel no such action is necessary to maintain the perfection of such lien and security interest. Such Opinion of Counsel shall also describe the recording, filing, re-recording and refiling of this Indenture, any indentures supplemental hereto and any other requisite documents and the execution and filing of any financing statements and continuation statements that will, in the opinion of such counsel, be required to maintain the perfection of the lien and security interest of this Indenture until May 30 in the following calendar year. Section 3.7. Performance of Obligations; Servicing of ---------------------------------------- Receivables. ----------- (a) The Issuer will not take any action and will use its best efforts not to permit any action to be taken by others that would release any Person from any of such Person's material covenants or obligations under any instrument or agreement included in the Collateral or that would result in the amendment, hypothecation, subordination, termination or discharge of, or impair the validity or effectiveness of, any such instrument or agreement, except as expressly provided in this Indenture, the Transfer and Servicing Agreement or such other instrument or agreement. (b) The Issuer may contract with other Persons to assist it in performing its duties under this Indenture, and any performance of such duties by a Person identified to the Indenture Trustee in an Officer's Certificate of the Issuer shall be deemed to be action taken by the Issuer. Initially, the Issuer has contracted with the Administrator to assist the Issuer in performing its duties under this Indenture. (c) The Issuer will punctually perform and observe all of its obligations and agreements contained in this Indenture, the other Transaction Documents and in the instruments and agreements relating to the Collateral, including but not limited to filing or causing to be filed all UCC financing statements and continuation statements required to be filed by the terms of this Indenture and the Transfer and Servicing Agreement in accordance with and within the time periods provided for herein and therein. (d) If the Issuer shall have knowledge of the occurrence of a Servicer Default under the Transfer and Servicing Agreement, the Issuer shall cause the Indenture Trustee to promptly notify the Rating Agencies thereof, and shall cause the 19 Indenture Trustee to specify in such notice the action, if any, being taken with respect to such default. If a Servicer Default shall arise from the failure of the Servicer to perform any of its duties or obligations under the Transfer and Servicing Agreement with respect to the Receivables, the Issuer shall take all reasonable steps available to it to remedy such failure. (e) On and after the receipt by the Servicer of a Termination Notice pursuant to Section 7.1 of the Transfer and Servicing Agreement, ----------- the Servicer shall continue to perform all servicing functions under this Indenture until the date specified in the Termination Notice or until a date mutually agreed upon by the Servicer and the Indenture Trustee. As promptly as possible after the giving of a Termination Notice to the Servicer, the Indenture Trustee shall appoint a Successor Servicer, and such Successor Servicer shall accept its appointment by a written assumption in a form acceptable to the Indenture Trustee. In the event that a Successor Servicer has not been appointed and accepted its appointment at the time when the Servicer ceases to act as Servicer, the Indenture Trustee in accordance with Section 7.2 of the ----------- Transfer and Servicing Agreement without further action shall automatically be appointed the Successor Servicer. The Indenture Trustee may delegate any of its servicing obligations to an Affiliate or agent in accordance with Section 3.1(b) and Section 5.7 of the -------------- ----------- Transfer and Servicing Agreement. Notwithstanding the foregoing, the Indenture Trustee shall, if it is legally unable so to act, petition at the expense of the Servicer a court of competent jurisdiction to appoint any established institution qualifying as an Eligible Servicer as the Successor Servicer hereunder. The Indenture Trustee shall give prompt notice to each Rating Agency and each Series Enhancer upon the appointment of a Successor Servicer. Upon its appointment, the Successor Servicer shall be the successor in all respects to the Servicer with respect to servicing functions under this Indenture and shall be subject to all the responsibilities, duties and liabilities relating thereto placed on the Servicer by the terms and provisions hereof, and all references in this Indenture to the Servicer shall be deemed to refer to the Successor Servicer. In connection with any Termination Notice, the Indenture Trustee will review any bids which it obtains from Eligible Servicers and shall be permitted to appoint any Eligible Servicer submitting such a bid as a Successor Servicer for servicing compensation, subject to the limitations set forth in Section ------- 7.2 of the Transfer and Servicing Agreement. Notwithstanding anything --- else herein to the contrary, in no event shall the Indenture Trustee be liable for any servicing fee. (f) Without derogating from the absolute nature of the assignment granted to the Indenture Trustee under this Indenture or the rights of the Indenture Trustee hereunder, the Issuer agrees (i) that it will not, without the prior written consent of the Indenture Trustee and satisfaction of the Rating Agency Condition, amend, modify, waive, supplement, terminate or surrender, or agree to any amendment, modification, supplement, termination, waiver or surrender of, the terms 20 of any Collateral (except to the extent otherwise provided in the Transfer and Servicing Agreement) or the Transaction Documents (except to the extent otherwise provided in the Transaction Documents), or waive timely performance or observance by the Servicer or the Seller under the Transfer and Servicing Agreement; and (ii) that any such amendment shall not (A) increase or reduce in any manner the amount of, or accelerate or delay the timing of, distributions that are required to be made for the benefit of the Noteholders or (B) reduce the aforesaid percentage of the Notes that is required to consent to any such amendment, without the consent of the Holders of all the Outstanding Notes. If any such amendment, modification, supplement or waiver shall be so consented to by the Indenture Trustee and such Noteholders, the Issuer agrees, promptly following a request by the Indenture Trustee to do so, to execute and deliver, in its own name and at its own expense, such agreements, instruments, consents and other documents as the Indenture Trustee may deem necessary or appropriate in the circumstances. Section 3.8. Negative Covenants. So long as any Notes are ------------------ Outstanding, the Issuer will not: (a) sell, transfer, exchange, or otherwise dispose of any part of the Collateral unless directed to do so by the Indenture Trustee, except as expressly permitted by this Indenture and any Indenture Supplement, the Trust Agreement or the Transfer and Servicing Agreement; (b) claim any credit on, or make any deduction from, the principal and interest payable in respect of the Notes (other than amounts properly withheld from such payments under the Code or applicable state law) or assert any claim against any present or former Noteholder by reason of the payment of any taxes levied or assessed upon any part of the Collateral; (c) incur, assume, guarantee or otherwise become liable, directly or indirectly, for any indebtedness other than incurred under the Notes and this Indenture; (d) (i) permit the validity or effectiveness of this Indenture to be impaired, or permit the lien of this Indenture to be amended, hypothecated, subordinated, terminated or discharged, or permit any Person to be released from any covenants or obligations with respect to the Notes under this Indenture except as may be expressly permitted hereby, (ii) permit any Lien, charge, excise, claim, security interest, mortgage or other encumbrance (other than the lien of this Indenture) to be created on or extend to or otherwise arise upon or burden the Collateral or any part thereof or any interest therein or the proceeds thereof or (iii) permit the lien of this Indenture not to constitute a valid first priority security interest (other than with respect to a tax, mechanics, or similar lien) in the Collateral; or 21 (e) voluntarily dissolve or liquidate in whole or in part. Section 3.9. Statements as to Compliance. The Issuer will --------------------------- deliver to the Indenture Trustee and the Rating Agencies, within 120 days after the end of each fiscal year of the Issuer at the end of which any Notes are outstanding (commencing within 120 days after the end of the fiscal year 2001), an Officer's Certificate stating, as to the Authorized Officer signing such Officer's Certificate, that (i) a review of the activities of the Issuer during the 12-month period ending at the end of such fiscal year and of performance under this Indenture has been made under such Authorized Officer's supervision, and (ii) to the best of such Authorized Officer's knowledge, based on such review, the Issuer has complied with all conditions and covenants under this Indenture throughout such year, or, if there has been a default in the compliance of any such condition or covenant, specifying each such default known to such Authorized Officer and the nature and status thereof. Section 3.10. Issuer May Consolidate, Etc., Only on Certain --------------------------------------------- Terms. ----- (a) The Issuer shall not consolidate or merge with or into any other Person, unless: (1) the Person (if other than the Issuer) formed by or surviving such consolidation or merger (the "Surviving --------- Person") (i) is organized and existing under the laws of the ------ United States of America or any state or the District of Columbia, (ii) is not subject to regulation as an "investment company" under the Investment Company Act and (iii) expressly assumes, by an indenture supplemental hereto, executed and delivered to the Indenture Trustee, in a form satisfactory to the Indenture Trustee, the obligation to make due and punctual payment of the principal of and interest on all Notes and the performance of every covenant of this Indenture on the part of the Issuer to be performed or observed; (2) immediately after giving effect to such transaction, no Event of Default or Pay Out Event shall have occurred and be continuing; (3) the Issuer shall have delivered to the Indenture Trustee an Officer's Certificate and an Opinion of Counsel each stating that (i) such consolidation or merger and such supplemental indenture 22 comply with this Section 3.10, (ii) all conditions precedent ------------ provided for in this Section 3.10 relating to such ------------ transaction have been complied with (including any filing required by the Exchange Act), and (iii) such supplemental indenture is duly authorized, executed and delivered and is valid, binding and enforceable against the Surviving Person; (4) the Rating Agency Condition shall have been satisfied with respect to such transaction; (5) the Issuer shall have received a Tax Opinion with respect to such consolidation or merger; and (6) any action that is necessary to maintain the lien and security interest created by this Indenture shall have been taken. For the avoidance of doubt, this Section 3.10 shall not apply to ------------ the transfer of the Receivables and other assets to the Issuer on the FCMT Termination Date. (b) The Issuer shall not convey or transfer any of its properties or assets, including those included in the Collateral, substantially as an entirety to any Person, unless: (1) the Person that acquires by conveyance or transfer the properties and assets of the Issuer the conveyance or transfer of which is hereby restricted (the "Acquiring --------- Person") (A) is a United States citizen or a Person ------ organized and existing under the laws of the United States of America or any state, or the District of Columbia, (B) is not subject to regulation as an "investment company" under the Investment Company Act, (C) expressly assumes, by an indenture supplemental hereto, executed and delivered to the Indenture Trustee, in form satisfactory to the Indenture Trustee, the obligation to make due and punctual payments of the principal of and interest on all Notes and the performance of every covenant of this Indenture on the part of the Issuer to be performed or observed, (D) expressly agree by means of such supplemental indenture that all right, title and interest so conveyed or transferred shall be subject and subordinate to the rights of Holders of the Notes, (E) unless otherwise provided in such supplemental indenture, expressly agree to indemnify, defend and hold harmless the Issuer against and from any loss, liability or expense arising under or related to this Indenture and the Notes and (F) expressly agree by means of such supplemental indenture that such Person (or if a group of Persons, then one specified Person) shall 23 make all filings with the Commission (and any other appropriate Person) required by the Exchange Act in connection with the Notes; (2) immediately after giving effect to such transaction, no Event of Default or Pay Out Event shall have occurred and be continuing; (3) the Rating Agency Condition shall have been satisfied with respect to such transaction; (4) the Issuer shall have received a Tax Opinion with respect to such transaction; (5) any action that is necessary to maintain the lien and security interest created by this Indenture shall have been taken; and (6) the Issuer shall have delivered to the Indenture Trustee an Officer's Certificate and an Opinion of Counsel each stating that (i) such conveyance or transfer and such supplemental indenture comply with this Section 3.10, (ii) all ------------ conditions precedent herein provided for relating to such transaction have been complied with (including any filing required by the Exchange Act), and (iii) such supplemental indenture is duly authorized, executed and delivered and is valid, binding and enforceable against the Acquiring Person. Section 3.11. Successor Substituted. Upon any consolidation or merger, --------------------- or any conveyance or transfer of the properties and assets of the Issuer substantially as an entirety in accordance with Section 3.10, the Surviving ------------ Person or the Acquiring Person, as the case may be, shall succeed to, and be substituted for, and may exercise every right and power of, the Issuer under this Indenture with the same effect as if such Person had been named as the Issuer herein. In the event of any such conveyance or transfer, the Person named as the Issuer in the first paragraph of this Indenture or any successor which shall theretofore have become such in the manner prescribed in this Section 3.11 shall be released from its obligations under this ------------ Indenture as issued immediately upon the effectiveness of such conveyance or transfer, provided that the Issuer shall not be released from any obligations or liabilities to the Indenture Trustee or the Noteholders arising prior to such effectiveness. Section 3.12. No Other Business. The Issuer shall not engage in any ----------------- business other than (i) purchasing, owning and managing the Trust Assets and the proceeds thereof in the manner contemplated by this Indenture and the other 24 Transaction Documents, (ii) issuing and making payments in respect of the Notes and (iii) all activities related thereto. Section 3.13. [Reserved]. Section 3.14. Servicer's Obligations. The Issuer shall cause the ---------------------- Servicer to comply with all of its obligations under the Transaction Documents. Section 3.15. Investments. Except as contemplated by this ----------- Indenture or the Transfer and Servicing Agreement, the Issuer shall not own, purchase, repurchase or acquire (or agree contingently to do so) any stock, obligations, assets or securities of, or any other interest in, or make any capital contribution to, any other Person. Section 3.16. Capital Expenditures. The Issuer shall not make any -------------------- expenditure (by long-term or operating lease or otherwise) for capital assets (either realty or personalty). Section 3.17. Removal of Administrator. So long as any Notes are ------------------------ outstanding, the Issuer shall not remove the Administrator without cause unless the Rating Agency Condition shall have been satisfied in connection with such removal. Section 3.18. Restricted Payments. The Issuer shall not, directly ------------------- or indirectly, (i) pay any dividend or make any distribution (by reduction of capital or otherwise), whether in cash, property, securities or a combination thereof, to the Owner Trustee or any owner of a beneficial interest in the Issuer or otherwise with respect to any ownership or equity interest or security in or of the Issuer or to the Servicer, (ii) redeem, purchase, retire or otherwise acquire for value any such ownership or equity interest or security or (iii) set aside or otherwise segregate any amounts for any such purpose; provided, -------- however, that the Issuer may make, or cause to be made, (x) ------- distributions as contemplated by, and to the extent funds are available for such purpose under, the Transaction Documents and (y) payments to the Indenture Trustee pursuant to Section 6.7. The Issuer will not, ----------- directly or indirectly, make payments to or distributions from the Collection Account except in accordance with the Transaction Documents. Section 3.19. Notice of Events of Default. The Issuer agrees to --------------------------- give a Trustee Officer of the Indenture Trustee and the Rating Agencies prompt written notice of each Event of Default hereunder and written notice of each default on the part of the Servicer or the Seller of its obligations under the Transfer and Servicing Agreement, immediately after obtaining knowledge thereof. Section 3.20. Further Instruments and Acts. Upon request of the ---------------------------- Indenture Trustee, the Issuer will execute and deliver such further instruments and do such 25 further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture. ARTICLE IV SATISFACTION AND DISCHARGE Section 4.1. Satisfaction and Discharge of this Indenture. This -------------------------------------------- Indenture shall cease to be of further effect with respect to the Notes except as to (a) rights of registration of transfer and exchange, (b) substitution of mutilated, destroyed, lost or stolen Notes, (c) the rights of Noteholders to receive payments of principal thereof and interest thereon, (d) Sections 3.3, 3.7, 3.8, 3.11, 3.12 and 12.16, (e) ------------ --- --- ---- ---- ----- the rights and immunities of the Indenture Trustee hereunder, including the rights of the Indenture Trustee under Section 6.7, and the ----------- obligations of the Indenture Trustee under Section 4.2, and (f) the ----------- rights of Noteholders as beneficiaries hereof with respect to the property so deposited with the Indenture Trustee and payable to all or any of them, and the Indenture Trustee, on written demand of and at the expense of the Issuer, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture with respect to the Notes when: (i) either (A) all Notes theretofore authenticated and delivered (other than (1) Notes which have been destroyed, lost or stolen and which have been replaced, or paid as provided in Section 2.6, and ----------- (2) Notes for whose full payment money has theretofore been deposited in trust or segregated and held in trust by the Issuer and thereafter repaid to the Issuer or discharged from such trust, as provided in Section 3.3) have been delivered to ----------- the Indenture Trustee for cancellation; or (B) all Notes not theretofore delivered to the Indenture Trustee for cancellation: (1) have become due and payable; (2) will become due and payable at the Series Termination Date for such Class or Series of Notes; or (3) are to be called for redemption within one year under arrangements satisfactory to the Indenture Trustee for the giving of notice of redemption by the Indenture Trustee in the name, and at the expense, of the Issuer; 26 (4) and the Issuer, in the case of (1), (2) or (3) above, has irrevocably deposited or caused to be irrevocably deposited with the Indenture Trustee cash or direct obligations of or obligations guaranteed by the United States of America (which will mature prior to the date such amounts are payable), in trust for such purpose, in an amount sufficient to pay and discharge the entire indebtedness on such Notes not theretofore delivered to the Indenture Trustee for cancellation when due at the Series Termination Date for such Class or Series of Notes or the Redemption Date (if Notes shall have been called for redemption pursuant to the related Indenture Supplement), as the case may be; (ii) the Issuer has paid or caused to be paid all other sums payable hereunder by the Issuer; and (iii) the Issuer has delivered to the Indenture Trustee an Officer's Certificate, an Opinion of Counsel and (if required by the TIA or the Indenture Trustee) an Independent Certificate from a firm of certified public accountants, each meeting the applicable requirements of Section 12.1(a) and each stating that --------------- all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with. Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Issuer to the Indenture Trustee under Section ------- 6.7 and of the Indenture Trustee to the Noteholders under Section 4.2 --- ----------- shall survive. Section 4.2. Application of Issuer Money. All monies deposited --------------------------- with the Indenture Trustee pursuant to Section 4.1 shall be held in ----------- trust and applied by it, in accordance with the provisions of the Notes, this Indenture and the applicable Indenture Supplement, to make payments, either directly or through any Paying Agent to the Noteholders and for the payment in respect of which such monies have been deposited with the Indenture Trustee, of all sums due and to become due thereon for principal and interest; but such monies need not be segregated from other funds except to the extent required herein or in the Transfer and Servicing Agreement or required by law. ARTICLE V PAY OUT EVENTS, DEFAULTS AND REMEDIES Section 5.1. Pay Out Events. If any one of the following events -------------- (each, a "Trust Pay Out Event") shall occur: ------------------- 27 (a) the occurrence of an Insolvency Event relating to the Seller; (b) a Transfer Restriction Event shall occur; or (c) the Issuer shall become subject to regulation by the Commission as an "investment company" within the meaning of the Investment Company Act; then a Pay Out Event with respect to all Series of Notes shall occur without any notice or other action on the part of the Indenture Trustee or the Noteholders immediately upon the occurrence of such event. Upon the occurrence of a Pay Out Event, payment on the Notes of each Series will be made in accordance with the terms of the related Indenture Supplement. Section 5.2. Events of Default. "Event of Default," wherever used ----------------- ---------------- herein, means with respect to any Series any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body): (a) default in the payment of the principal of any Note of that Series, if and to the extent not previously paid, when the same becomes due and payable on its Series Termination Date; or (b) default in the payment of any interest on any Note of that Series when the same becomes due and payable, and such default shall continue for a period of thirty-five (35) days; or (c) the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of the Issuer in an involuntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, conservator, liquidator, assignee, custodian, trustee, sequestrator or similar official for the Issuer or ordering the winding-up or liquidation of the Issuer's affairs, and such decree or order shall remain unstayed and in effect for a period of sixty (60) consecutive days; or (d) the commencement by the Issuer of a voluntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the consent by the Issuer to the entry of an order for relief in an involuntary case under any such law, or the consent by the Issuer to the appointment of or the taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator or similar official of the Issuer, or the making by the Issuer 28 of any general assignment for the benefit of creditors, or the failure by the Issuer generally to pay, or the admission in writing by the Issuer of its inability to pay, its debts as such debts become due, or the taking of action by the Issuer in furtherance of any of the foregoing; or (e) default in the observance or performance of any covenant or agreement of the Issuer made in this Indenture made in respect of the Notes of such Series (other than a covenant or agreement, a default in the observance or performance of which is elsewhere in this Section 5.2 ----------- specifically dealt with) (all of such covenants and agreements in the Indenture which are not expressly stated to be for the benefit of a particular Series being deemed to be in respect of the Notes of all Series for this purpose) and such default shall continue or not be cured for a period of sixty (60) days after there shall have been given, by registered or certified mail, return receipt requested to the Issuer by the Indenture Trustee or to the Issuer and the Indenture Trustee by the Holders of Notes representing at least 25% of the principal balance of the Outstanding Notes of such Series, a written notice specifying such default and requiring it to be remedied and stating that such notice is a "Notice of Default" hereunder and, as a ----------------- result of such default, the interests of the Holders of the Notes are materially and adversely affected and continue to be materially and adversely affected during the 60-day period; or (f) any additional events specified in the Indenture Supplement related to such Series. The Issuer shall deliver to a Trustee Officer of the Indenture Trustee, within five (5) days after the occurrence thereof, written notice in the form of an Officer's Certificate of any event which with the giving of notice and the lapse of time would become an Event of Default, its status and what action the Issuer is taking or proposes to take with respect thereto. Section 5.3. Acceleration of Maturity; Rescission and Annulment. -------------------------------------------------- If an Event of Default described in paragraph (a), (b) or (e) of ------------- --- --- Section 5.2 should occur and be continuing with respect to a Series, ----------- then and in every such case the Indenture Trustee or the Holders of Notes representing more than 50% of the principal balance of the Outstanding Notes of such Series may declare all the Notes of such Series to be immediately due and payable, by a notice in writing to the Issuer (and to a Trustee Officer of the Indenture Trustee if declared by Noteholders), and upon any such declaration the unpaid principal amount of such Notes, together with accrued and unpaid interest thereon through the date of acceleration, shall become immediately due and payable. If an Event of Default described in paragraph (c) or (d) of ------------- --- Section 5.2 should occur and be continuing, then the unpaid principal ----------- of the Notes, together with 29 accrued and unpaid interest thereon through the date of acceleration, shall automatically become due and payable. At any time after such declaration of acceleration of maturity has been made and before a judgment or decree for payment of the money due has been obtained by the Indenture Trustee as hereinafter provided in this Article V, the Holders of Notes representing more than 50% of --------- the principal balance of the Outstanding Notes of such Series, by written notice to the Issuer, a Trustee Officer of the Indenture Trustee and the Rating Agencies, may rescind and annul such declaration and its consequences; provided, that: -------- ---- (a) the Issuer has paid or deposited with the Indenture Trustee a sum sufficient to pay: (i) all payments of principal of and interest on all Notes and all other amounts that would then be due hereunder or upon such Notes if the Event of Default giving rise to such acceleration had not occurred; and (ii) all sums paid or advanced by the Indenture Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of the Indenture Trustee and its agents and counsel; and (b) all Events of Default, other than the nonpayment of the principal of the Notes that has become due solely by such acceleration, have been cured or waived as provided in Section 5.13. ------------ No such rescission shall affect any subsequent default or impair any right consequent thereto. Section 5.4. Collection of Indebtedness and Suits for ---------------------------------------- Enforcement by Indenture Trustee. -------------------------------- (a) The Issuer covenants that if (i) default is made in the payment of any interest on any Note when the same becomes due and payable, and such default continues for a period of thirty-five (35) days following the date on which such interest became due and payable, or (ii) default is made in the payment of principal of any Note, if and to the extent not previously paid, when the same becomes due and payable on the Series Termination Date, the Issuer will, upon demand of the Indenture Trustee, pay to it, for the benefit of the Holders of the Notes of the affected Series, the whole amount then due and payable on such Notes for principal and interest, with interest upon the overdue principal, and, to the extent payment at such rate of interest shall be legally enforceable, interest upon overdue installments of interest, as specified in the related Indenture Supplement, and in addition thereto will 30 pay such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Indenture Trustee and its agents and counsel. (b) In case the Issuer shall fail forthwith to pay such amounts upon such demand, the Indenture Trustee, in its own name and as trustee of an express trust, may institute a Proceeding for the collection of the sums so due and unpaid, and may prosecute such Proceeding to judgment or final decree, and may enforce the same against the Issuer or other obligor upon such Notes and collect in the manner provided by law out of the property of the Issuer or other obligor upon such Notes, wherever situated, the moneys adjudged or decreed to be payable. (c) If an Event of Default occurs and is continuing, the Indenture Trustee may, as more particularly provided in Section 5.5, in ----------- its discretion, proceed to protect and enforce its rights and the rights of the Noteholders of the affected Series, by such appropriate Proceedings as the Indenture Trustee shall deem most effective to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy or legal or equitable right vested in the Indenture Trustee by this Indenture or by law. (d) In case there shall be pending, relative to the Issuer or any other obligor upon the Notes of the affected Series, or any Person having or claiming an ownership interest in the Collateral, Proceedings under Title 11 of the United States Code or any other applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or in case a receiver, conservator, assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator, custodian or other similar official shall have been appointed for or taken possession of the Issuer or its property or such other obligor or Person, or in case of any other comparable judicial Proceedings relative to the Issuer or other obligor upon the Notes of such Series, or to the creditors or property of the Issuer or such other obligor, the Indenture Trustee, irrespective of whether the principal of any Notes shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Indenture Trustee shall have made any demand pursuant to the provisions of this Section 5.4, shall be entitled and empowered, by intervention in such ----------- Proceedings or otherwise: (i) to file and prove a claim or claims for the whole amount of principal and interest owing and unpaid in respect of the Notes of such Series and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Indenture Trustee (including any claim for reasonable compensation to the Indenture Trustee and each predecessor Indenture Trustee, and their respective agents, attorneys and counsel, and for 31 reimbursement of all expenses and liabilities incurred, and all advances made, by the Indenture Trustee and each predecessor Indenture Trustee, except as a result of negligence or willful misconduct) and of the Noteholders of such Series allowed in such Proceedings; (ii) unless prohibited by applicable law and regulations, to vote on behalf of the Holders of Notes of such Series in any election of a trustee, a standby trustee or Person performing similar functions in any such Proceedings; (iii) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute all amounts received with respect to the claims of the Noteholders of such Series and of the Indenture Trustee on their behalf; and (iv) to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Indenture Trustee or the Holders of Notes of such Series allowed in any judicial Proceedings relative to the Issuer, its creditors and its property; and any trustee, receiver, conservator, liquidator, custodian, assignee, sequestrator or other similar official in any such Proceeding is hereby authorized by each of such Noteholders to make payments to the Indenture Trustee, and, in the event that the Indenture Trustee shall consent to the making of payments directly to such Noteholders, to pay to the Indenture Trustee such amounts as shall be sufficient to cover reasonable compensation to the Indenture Trustee, each predecessor Indenture Trustee and their respective agents, attorneys and counsel, and all other expenses and liabilities incurred, and all advances made, by the Indenture Trustee and each predecessor Indenture Trustee except as a result of negligence or willful misconduct. (e) Nothing herein contained shall be deemed to authorize the Indenture Trustee to authorize or consent to or vote for or accept or adopt on behalf of any Noteholder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof or to authorize the Indenture Trustee to vote in respect of the claim of any Noteholder in any such proceeding except, as aforesaid, to vote for the election of a trustee in bankruptcy or similar Person. (f) All rights of action and of asserting claims under this Indenture, or under any of the Notes, may be enforced by the Indenture Trustee without the possession of any of the Notes or the production thereof in any trial or other Proceedings relative thereto, and any such action or Proceedings instituted by the Indenture Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment, subject to the payment of the expenses, disbursements and 32 compensation of the Indenture Trustee, each predecessor Indenture Trustee and their respective agents and attorneys, shall be for the benefit of the Holders of the Notes of the affected Series as provided herein. (g) In any Proceedings brought by the Indenture Trustee (and also any Proceedings involving the interpretation of any provision of this Indenture to which the Indenture Trustee shall be a party), the Indenture Trustee shall be held to represent all the Holders of the Notes of the affected Series, and it shall not be necessary to make any such Noteholder a party to any such Proceedings. Section 5.5. Remedies; Priorities. -------------------- (a) If an Event of Default shall have occurred and be continuing with respect to any Series, and the Notes of such Series have been accelerated pursuant to Section 5.3, the Indenture Trustee ----------- may do one or more of the following (subject to Sections 5.6 and ------------ 12.16): ----- (i) institute Proceedings in its own name and as trustee of an express trust for the collection of all amounts then payable on the Notes of the affected Series or under this Indenture with respect thereto, whether by declaration or otherwise, enforce any judgment obtained, and collect from the Issuer and any other obligor upon such Notes moneys adjudged due; (ii) take any other appropriate action to protect and enforce the rights and remedies of the Indenture Trustee and the Holders of the Notes of the affected Series; (iii) cause the Issuer to sell Principal Receivables (or interests therein) in an amount equal to the Collateral Amount of the accelerated Series and the related Finance Charge Receivables in accordance with Section 5.16; ------------ provided, however, that the Indenture Trustee may not exercise the -------- ------- remedy described in subparagraph (iii) above unless (A) (1) the Holders of Notes representing 100% of the principal balance of the Outstanding Notes of the affected Series consent in writing thereto, (2) the Indenture Trustee determines that any proceeds of such exercise distributable to the Noteholders of the affected Series are sufficient to discharge in full all amounts then due and unpaid upon the Notes for principal and interest and is directed to exercise this remedy by Holders of Notes representing more than 50% of the principal balance of the Outstanding Notes of such Series, or (3) the Indenture Trustee determines that the Collateral may not continue to provide sufficient funds for the payment of principal of and interest on the Notes as they would have become due if the Notes had not been declared due and payable, and the Indenture Trustee obtains the consent of the Holders of Notes representing at least 33 66-2/3% of the principal balance of the Outstanding Notes of each Class of such Series and (B) the Indenture Trustee has obtained an Opinion of Counsel to the effect that the exercise of such remedy complies with applicable federal and state securities laws. In determining such sufficiency or insufficiency with respect to clauses (A)(2) and (A)(3), the Indenture Trustee may, but need not, obtain and conclusively rely upon an opinion of an Independent investment banking or accounting firm of national reputation as to the feasibility of such proposed action and as to the sufficiency of the Collateral for such purpose. The remedies provided in this Section 5.5(a) are the exclusive -------------- remedies provided to the Noteholders with respect to the Collateral and each of the Noteholders (by their acceptance of their respective interests in the Notes) or the Indenture Trustee hereby expressly waive any other remedy that might have been available under the applicable UCC. (b) If the Indenture Trustee collects any money or property pursuant to this Article V following the acceleration of the Notes of the affected Series pursuant to Section 5.3 (so long as such a declaration shall not have been rescinded or annulled), it shall pay out the money or property in the following order: FIRST: to the Indenture Trustee for amounts due pursuant to Section 6.7; and ----------- SECOND: unless otherwise specified in the related Indenture Supplement, to the Servicer for distribution in accordance with Article IV of the related Indenture Supplement with such amounts being deemed to be Principal Collections and Finance Charge Collections in the same proportion as (x) the outstanding principal balance of the Notes bears to (y) the sum of the accrued and unpaid interest on the Notes and other fees and expenses payable in connection therewith under the applicable Indenture Supplement, including the amounts payable under any Enhancements with respect to such Series. (c) The Indenture Trustee may, upon notification to the Issuer, fix a record date and payment date for any payment to Noteholders of the affected Series pursuant to this Section 5.5. At ----------- least fifteen (15) days before such record date, the Indenture Trustee shall mail or send by facsimile, at the expense of the Servicer, to each such Noteholder a notice that states the record date, the payment date and the amount to be paid. 34 Section 5.6. Optional Preservation of the Collateral. If the --------------------------------------- Notes of any Series have been declared to be due and payable under Section 5.3 following an Event of Default and such declaration and its ----------- consequences have not been rescinded and annulled, and the Indenture Trustee has not received directions from the Noteholders pursuant to Section 5.12, the Indenture Trustee may, but need not, elect to ------------ maintain possession of the portion of the Collateral which secures such Notes and apply proceeds of the Collateral to make payments on such Notes to the extent such proceeds are available therefor. It is the desire of the parties hereto and the Noteholders that there be at all times sufficient funds for the payment of principal of and interest on the Notes, and the Indenture Trustee shall take such desire into account when determining whether or not to maintain possession of the Collateral. In determining whether to maintain possession of the Collateral, the Indenture Trustee may, but need not, obtain and conclusively rely upon an opinion of an Independent investment banking or accounting firm of national reputation as to the feasibility of such proposed action and as to the sufficiency of the Trust Assets for such purpose. Section 5.7. Limitation on Suits. No Noteholder shall have any ------------------- right to institute any proceedings, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless: (a) the Holders of Notes representing not less than 25% of the principal balance of the Outstanding Notes of each affected Series have made written request to the Indenture Trustee to institute such proceeding in its own name as indenture trustee; (b) such Noteholder or Noteholders has previously given written notice to the Indenture Trustee of a continuing Event of Default; (c) such Noteholder or Noteholders has offered to the Indenture Trustee indemnity satisfactory to it against the costs, expenses and liabilities to be incurred in compliance with such request; (d) the Indenture Trustee for sixty (60) days after its receipt of such request and offer of indemnity has failed to institute any such Proceeding; and (e) no direction inconsistent with such written request has been given to the Indenture Trustee during such 60-day period by the Holders of Notes representing more than 50% of the principal balance of the Outstanding Notes of such Series; it being understood and intended that no one or more Noteholders of the affected Series shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other 35 Noteholders of such Series or to obtain or to seek to obtain priority or preference over any other Noteholders of such Series or to enforce any right under this Indenture, except in the manner herein provided. In the event the Indenture Trustee shall receive conflicting or inconsistent requests and indemnity from two (2) or more groups of Noteholders of such affected Series, each representing no more than 50% of the principal balance of the Outstanding Notes of such Series, the Indenture Trustee in its sole discretion may determine what action, if any, shall be taken, notwithstanding any other provisions of this Indenture. Section 5.8. Unconditional Rights of Noteholders to Receive ---------------------------------------------- Principal and Interest. Notwithstanding any other provision in this ---------------------- Indenture, each Noteholder shall have the right which is absolute and unconditional to receive payment of the principal of and interest in respect of such Note as such principal and interest becomes due and payable and to institute suit for the enforcement of any such payment, and such right shall not be impaired without the consent of such Noteholder. Section 5.9. Restoration of Rights and Remedies. If the ---------------------------------- Indenture Trustee or any Noteholder has instituted any Proceeding to enforce any right or remedy under this Indenture and such Proceeding has been discontinued or abandoned, or has been determined adversely to the Indenture Trustee or to such Noteholder, then and in every such case the Issuer, the Indenture Trustee and the Noteholder shall, subject to any determination in such Proceeding, be restored severally and respectively to their former positions hereunder, and thereafter all rights and remedies of the Indenture Trustee and the Noteholders shall continue as though no such Proceeding had been instituted. Section 5.10. Rights and Remedies Cumulative. No right, ------------------------------ remedy, power or privilege herein conferred upon or reserved to the Indenture Trustee or to the Noteholders is intended to be exclusive of any other right, remedy, power or privilege, and every right, remedy, power or privilege shall, to the extent permitted by law, be cumulative and in addition to every other right, remedy, power or privilege given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or exercise of any right or remedy shall not preclude any other further assertion or the exercise of any other appropriate right or remedy. Section 5.11. Delay or Omission Not Waiver. No failure to ---------------------------- exercise and no delay in exercising, on the part of the Indenture Trustee or of any Noteholder or other Person, any right or remedy occurring hereunder upon any Event of Default shall impair any such right or remedy or constitute a waiver thereof of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article V or by law to the Indenture Trustee or to the Noteholders --------- may be exercised from time 36 to time, and as often as may be deemed expedient, by the Indenture Trustee or by the Noteholders, as the case may be. Section 5.12. Rights of Noteholders to Direct Indenture ----------------------------------------- Trustee. The Holders of Notes representing more than 50% of the ------- principal balance of the Outstanding Notes of any affected Series shall have the right to direct in writing the time, method and place of conducting any Proceeding for any remedy available to the Indenture Trustee with respect to such Series or exercising any trust or power conferred on the Indenture Trustee with respect to such Series; provided, however, that subject to Section 6.1: -------- ------- ----------- (a) the Indenture Trustee shall have the right to decline any such direction if the Indenture Trustee, after being advised by counsel, determines that the action so directed is in conflict with any rule of law or with this Indenture, and (b) the Indenture Trustee shall have the right to decline any such direction if the Indenture Trustee in good faith shall, by a Trustee Officer of the Indenture Trustee, determine that the Proceedings so directed would be illegal or involve the Indenture Trustee in personal liability or be unjustly prejudicial to the Noteholders not parties to such direction. Section 5.13. Waiver of Past Defaults. Prior to the ----------------------- declaration of the acceleration of the maturity of the Notes of the affected Series as provided in Section 5.3, Holders of Notes ----------- representing more than 50% of the principal balance of the Outstanding Notes of such Series (or with respect to any such Series with two or more Classes, of each Class), may, on behalf of all such Noteholders, waive in writing any past default, with written notice to the Indenture Trustee, with respect to such Notes and its consequences, except a default: (a) in the payment of the principal or interest in respect of any Note of such Series, or (b) in respect of a covenant or provision hereof that under Section 10.2 cannot be modified or amended without the consent of the ------------ Noteholder of each Outstanding Note affected. Upon any such written waiver, such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon. Section 5.14. Undertaking for Costs. All parties to this --------------------- Indenture agree, and each Noteholder by its acceptance thereof shall be deemed to have agreed, that any 37 court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Indenture Trustee for any action taken, suffered or omitted by it as Indenture Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees, against any party litigant (other than the Indenture Trustee) in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section 5.14 shall not apply to any suit instituted by the Indenture ------------ Trustee, to any suit instituted by any Noteholder, or group of Noteholders (in compliance with Section 5.8), holding Notes ----------- representing more than 10% of the principal balance of the Outstanding Notes of the affected Series, or to any suit instituted by any Noteholder for the enforcement of the payment of the principal or interest in respect of any Note on or after the Distribution Date on which any of such amounts was due (or, in the case of redemption, on or after the applicable Redemption Date). Section 5.15. Waiver of Stay or Extension Laws. The Issuer -------------------------------- covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may adversely affect the covenants or the performance of this Indenture; and the Issuer (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Indenture Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted. Section 5.16. Sale of Receivables. -------------------- (a) The method, manner, time, place and terms of any sale of Receivables pursuant to Section 5.5(a)(iii) shall be commercially ------------------- reasonable. The Indenture Trustee may from time to time postpone any sale by public announcement made at the time and place of such sale. The Indenture Trustee hereby expressly waives its right to any amount fixed by law as compensation for any sale. (b) The Indenture Trustee is hereby irrevocably appointed the agent and attorney-in-fact of the Issuer in connection with any sale of Receivables pursuant to Section 5.5(a)(iii). No purchaser or transferee ------------------- at any such sale shall be bound to ascertain the Indenture Trustee's authority, inquire into the satisfaction of any conditions precedent or see to the application of any monies. (c) In its exercise of the foreclosure remedy pursuant to Section 5.5(a)(iii), the Indenture Trustee shall solicit bids for the ------------------- sale of Principal Receivables in any amount equal to the Collateral Amount of the affected Series of 38 Notes at the time of sale and the related Finance Charge Receivables (or interests therein). The Seller or any of its affiliates shall be entitled to participate in, and to receive from the Indenture Trustee a copy of each other bid submitted in connection with, such bidding process; provided that (i) at least one participant other than the -------- Seller and any of its affiliates must submit a bona fide offer, and (ii) the Seller and any of its affiliates are prohibited from bidding an amount which exceeds fair value for the transferred assets. The Indenture Trustee shall sell such Receivables (or interests therein) to the bidder with the highest cash purchase offer. The proceeds of any such sale shall be applied as specified in the applicable Indenture Supplement. Section 5.17. Action on Notes. The Indenture Trustee's right --------------- to seek and recover judgment on the Notes or under this Indenture shall not be affected by the seeking or obtaining of or application for any other relief under or with respect to this Indenture. Neither the lien of this Indenture nor any rights or remedies of the Indenture Trustee or the Noteholders shall be impaired by the recovery of any judgment by the Indenture Trustee against the Issuer or by the levy of any execution under such judgment upon any portion of the Collateral or upon any of the assets of the Issuer. Any money or property collected by the Indenture Trustee shall be applied as specified in the applicable Indenture Supplement. ARTICLE VI THE INDENTURE TRUSTEE Section 6.1. Duties of the Indenture Trustee. ------------------------------- (a) If an Event of Default has occurred and is continuing and a Trustee Officer shall have actual knowledge or written notice of such Event of Default, the Indenture Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs. (b) Except during the continuance of an Event of Default: (i) the Indenture Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against the Indenture Trustee; and (ii) in the absence of bad faith or negligence on its part, the Indenture Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Indenture Trustee and conforming to the 39 requirements of this Indenture; provided, however, the -------- ------- Indenture Trustee, upon receipt of any resolutions, certificates, statements, opinions, reports, documents, orders or other instruments furnished to the Indenture Trustee which are specifically required to be furnished pursuant to any provision of this Indenture or any Indenture Supplement, shall examine them to determine whether they substantially conform to the requirements of this Indenture or any Indenture Supplement. (c) If a Pay Out Event has occurred and is continuing and a Trustee Officer shall have actual knowledge or written notice of such Pay Out Event, the Indenture Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs. (d) No provision of this Indenture shall be construed to relieve the Indenture Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that: (i) this Section 6.1(d) shall not be construed to --------------- limit the effect of Section 6.1(a); -------------- (ii) the Indenture Trustee shall not be liable for any error of judgment made in good faith by a Trustee Officer, unless it shall be proved that the Indenture Trustee was negligent in ascertaining the pertinent facts; and (iii) the Indenture Trustee shall not be liable with respect to any action taken, suffered or omitted to be taken by it in good faith in accordance with the Indenture and/or the direction of the Holders of Notes or for exercising any trust or power conferred upon the Indenture Trustee, under this Indenture. The Indenture Trustee shall not be liable for any action taken, suffered or omitted to be taken by it in good faith in accordance with the direction of the Servicer, the Seller or the Trust in compliance with the terms of this Indenture or any Indenture Supplement. (e) No provision of this Indenture shall require the Indenture Trustee to expend or risk its own funds or otherwise incur any liability, financial or otherwise, in the performance of any of its duties hereunder or in the exercise of any of its rights or powers if it shall have reasonable grounds for believing that repayment of such funds or indemnity satisfactory to it against such risk or liability is not reasonably assured to it. 40 (f) Every provision of this Indenture that in any way relates to the Indenture Trustee is subject to this Section 6.1. ----------- (g) Except as expressly provided in this Indenture, the Indenture Trustee shall have no power to vary the Collateral, including by (i) accepting any substitute payment obligation for a Receivable initially transferred to the Trust under the Transfer and Servicing Agreement, (ii) adding any other investment, obligation or security to the Trust or (iii) withdrawing from the Issuer any Receivable (except as otherwise provided in the Transfer and Servicing Agreement). (h) The Indenture Trustee shall have no responsibility or liability for investment losses on Permitted Investments (other than Permitted Investments on which the institution acting as Indenture Trustee is an obligor). The Indenture Trustee shall have no obligation to invest and reinvest any cash held in the absence of timely and specific written investment direction from the Issuer. In no event shall the Indenture Trustee be liable for the selection of investments or for investment losses incurred thereon. The Indenture Trustee shall have no liability in respect of losses incurred as a result of the liquidation of any investment prior to its stated maturity or the failure of the Issuer to provide timely written investment direction. (i) The Indenture Trustee shall notify each Rating Agency (i) of any change in any rating of the Notes by any other Rating Agency of which a Trustee Officer of the Indenture Trustee has actual knowledge, and (ii) immediately of the occurrence of any Event of Default or Pay Out Event of which a Trustee Officer of the Indenture Trustee has actual knowledge of or has actual notice from the Servicer of potential Pay Out Events or Events of Default. (j) For all purposes under this Indenture, the Indenture Trustee shall not be deemed to have notice or knowledge of any Event of Default, Pay Out Event or Servicer Default unless a Trustee Officer assigned to and working in the Corporate Trust Office of the Indenture Trustee has actual knowledge thereof or has received written notice thereof. For purposes of determining the Indenture Trustee's responsibility and liability hereunder, any reference to an Event of Default, Pay Out Event or Servicer Default shall be construed to refer only to such event of which the Indenture Trustee is deemed to have notice as described in this Section 6.1(j). -------------- Section 6.2. Notice of Pay Out Event or Event of Default. Upon ------------------------------------------- the occurrence of any Pay Out Event or Event of Default of which a Trustee Officer has actual knowledge or has received written notice thereof, the Indenture Trustee shall transmit by mail to all Noteholders as their names and addresses appear on the Note Register and the Rating Agencies, notice of such Pay Out Event or Event of Default hereunder known to the Indenture Trustee within thirty (30) days after it occurs or 41 within ten (10) Business Days after it receives such notice or obtains actual notice, if later. Section 6.3. Rights of Indenture Trustee. Except as otherwise --------------------------- provided in Section 6.1: ----------- (a) the Indenture Trustee may conclusively rely and shall fully be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, note or other paper or document reasonably believed by it to be genuine and to have been signed or presented by the proper party or parties; (b) whenever in the administration of this Indenture the Indenture Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Indenture Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, conclusively rely upon an Officer's Certificate of the Issuer. The Issuer shall provide a copy of such Officer's Certificate to the Noteholders at or prior to the time the Indenture Trustee receives such Officer's Certificate; (c) as a condition to the taking, suffering or omitting of any action by it hereunder, the Indenture Trustee may consult with counsel and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in-good faith and in reliance thereon; (d) the Indenture Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture or to honor the request or direction of any of the Noteholders pursuant to this Indenture, unless such Noteholders shall have offered to the Indenture Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction; (e) the Indenture Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, note or other paper or document, but the Indenture Trustee at the written direction of one or more of the Noteholders and at the expense of the Noteholders, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Indenture Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Issuer and the Servicer, personally or by agent or attorney; 42 (f) the Indenture Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents, attorneys, custodians or nominees and the Indenture Trustee shall not be responsible for any (i) misconduct or negligence on the part of any agent, attorney, custodians or nominees appointed with due care by it hereunder or (ii) the supervision of such agents, attorneys, custodians or nominees after such appointment with due care; (g) the Indenture Trustee shall not be liable for any actions taken, suffered or omitted by it in good faith and believed by it to be authorized or within the discretion or rights conferred upon the Indenture Trustee by this Indenture; and (h) in the event that the Indenture Trustee is also acting as Paying Agent and Transfer Agent and Registrar and Successor Servicer, if it becomes Successor Servicer pursuant to Section 7.2 of the Transfer and Servicing Agreement, the rights and protections afforded to the Indenture Trustee pursuant to this Article VI shall also be ---------- afforded to such Paying Agent and Transfer Agent and Registrar and Successor Servicer, if it becomes Successor Servicer pursuant to Section 7.2 of the Transfer and Servicing Agreement. Section 6.4. Not Responsible for Recitals or Issuance of ------------------------------------------- Notes. The recitals contained herein and in the Notes, except the ----- certificate of authentication of the Indenture Trustee, shall be taken as the statements of the Issuer, and the Indenture Trustee assumes no responsibility for their correctness. Neither the Indenture Trustee nor any of its agents makes any representation as to the validity or sufficiency of the Agreement, the Notes, or any related document. The Indenture Trustee shall not be accountable for the use or application by the Issuer of the proceeds from the Notes. Section 6.5. Restrictions on Holding Notes. The Indenture ----------------------------- Trustee shall not in its individual capacity, but may in a fiduciary capacity, become the owner or pledgee of Notes and may otherwise deal with the Issuer with the same rights it would have if it were not Indenture Trustee, Paying Agent, Transfer Agent and Registrar or such other agent. Any Paying Agent, Transfer Agent and Registrar that is not also the Indenture Trustee or any other agent of the Issuer, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with the Issuer with the same rights it would have if it were not Indenture Trustee, Paying Agent, Transfer Agent and Registrar or such other agent. Section 6.6. Money Held in Trust. Money held by the Indenture ------------------- Trustee in trust hereunder need not be segregated from other funds held by the Indenture Trustee in trust hereunder except to the extent required herein or required by law. The Indenture Trustee shall be under no liability for interest on any money received by it hereunder except as otherwise agreed upon in writing by the Indenture Trustee and the Issuer. 43 Section 6.7. Compensation, Reimbursement and Indemnification. ----------------------------------------------- The Servicer shall pay to the Indenture Trustee from time to time reasonable compensation for all services rendered by the Indenture Trustee and the Authenticating Agent under this Agreement (which compensation shall not be limited by any law on compensation of a trustee of an express trust). The Servicer shall reimburse the Indenture Trustee for all reasonable out-of-pocket expenses incurred or made by it, including costs of collection, in addition to the compensation for its services. Such expenses shall include the reasonable compensation and expenses, disbursements and advances of the Indenture Trustee's agents, counsel, accountants and experts. The Issuer shall direct the Servicer to indemnify, defend and hold harmless, and the Servicer shall indemnify the Indenture Trustee and its officers, directors, employees and agents against any and all loss, liability, expense, damage or claim (including the fees of either in-house counsel or outside counsel) incurred by it in connection with the administration of this trust and the performance of its duties hereunder and under any other Transaction Document, including any claim arising from any failure by Issuer or Seller to pay when due any sales, excise, transfer or personal taxes relating to the Receivables. The Indenture Trustee shall notify the Issuer and the Servicer promptly of any claim for which it may seek indemnity. Failure by the Indenture Trustee to so notify the Issuer and the Servicer shall not relieve the Issuer or the Servicer of its obligations hereunder unless such loss, liability or expense could have been avoided with such prompt notification and then only to the extent of such loss, expense or liability which could have been so avoided. The Servicer shall defend any claim against the Indenture Trustee, the Indenture Trustee may have separate counsel and, if it does, the Servicer shall pay the fees and expenses of such counsel. Neither the Issuer nor the Servicer need reimburse any expense or indemnify against any loss, liability or expense incurred by the Indenture Trustee through the Indenture Trustee's own willful misconduct or negligence. The Servicer's payment obligations to the Indenture Trustee pursuant to this Section 6.7 shall survive the discharge of this ----------- Indenture or earlier resignation or removal of the Indenture Trustee. When the Indenture Trustee incurs expenses after the occurrence of a Default specified in Section 5.2(c) or 5.2(d) with respect to the -------------- ------ Issuer, the expenses are intended to constitute expenses of administration under Title 11 of the United States Code or any other applicable federal or state bankruptcy, insolvency or similar law. To secure the Servicer's and Issuer's payment obligations in this Section 6.7, the Indenture Trustee shall have a lien prior to the ----------- Notes on all money or property held or collected by the Indenture Trustee, in its capacity as Indenture Trustee, except money or property held in trust to pay principal of, or interest on, the Notes. 44 Section 6.8. Replacement of Indenture Trustee. No resignation -------------------------------- or removal of the Indenture Trustee and no appointment of a successor Indenture Trustee shall become effective until the acceptance of appointment by the successor Indenture Trustee pursuant to this Section ------- 6.8. The Indenture Trustee may resign at any time by giving thirty (30) --- days written notice to the Issuer and the Rating Agencies. The Holders of Notes representing more than 66 2/3% of the Outstanding Amount may remove the Indenture Trustee by so notifying the Indenture Trustee in writing and may appoint a successor Indenture Trustee. The Administrator shall remove the Indenture Trustee upon written notice if: (i) the Indenture Trustee fails to comply with Section 6.11; ------------ (ii) the Indenture Trustee is adjudged a bankrupt or insolvent; (iii) a receiver of the Indenture Trustee or of its property shall be appointed, or any public officer takes charge of the Indenture Trustee or its property or its affairs for the purpose of rehabilitation, conservation or liquidation; or (iv) the Indenture Trustee otherwise becomes legally unable to act. If the Indenture Trustee resigns or is removed or if a vacancy exists in the office of Indenture Trustee for any reason (the Indenture Trustee in such event being referred to herein as the retiring Indenture Trustee), the Administrator shall promptly appoint a successor Indenture Trustee. A successor Indenture Trustee shall deliver a written acceptance of its appointment to the retiring Indenture Trustee, the Servicer and to the Issuer. Thereupon the resignation or removal of the retiring Indenture Trustee shall become effective, and the successor Indenture Trustee shall have all the rights, powers and duties of the Indenture Trustee under this Indenture. The successor Indenture Trustee shall mail a notice of its succession to Noteholders. The retiring Indenture Trustee shall promptly transfer all property held by it as Indenture Trustee to the successor Indenture Trustee, subject to the payment of any an all amounts then due and owing to the Indenture Trustee. If a successor Indenture Trustee does not take office within sixty (60) days after the retiring Indenture Trustee resigns or is removed, the retiring Indenture Trustee, the Issuer or the Holders of Notes representing more than 50% of the Outstanding Amount may petition any court of competent jurisdiction for the appointment of a successor Indenture Trustee. 45 If the Indenture Trustee fails to comply with Section 6.11, ------------ any Noteholder may petition any court of competent jurisdiction for the removal of the Indenture Trustee and the appointment of a successor Indenture Trustee. Notwithstanding the replacement of the Indenture Trustee pursuant to this Section 6.8, the Issuer's obligations under Section ----------- ------- 6.7 shall continue for the benefit of the retiring Indenture Trustee. --- The Administrator shall notify the Rating Agencies of any replacement of the Indenture Trustee pursuant to this Section 6.8. ----------- Section 6.9. Successor Indenture Trustee by Merger. If the ------------------------------------- Indenture Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Indenture Trustee; provided that such corporation or banking association shall be otherwise qualified and eligible under Section 6.11. The Indenture Trustee shall provide the Rating Agencies ------------ prior written notice of any such transaction. In case at the time such successor or successors by merger, conversion, consolidation or transfer to the Indenture Trustee shall succeed to the trusts created by this Indenture any of the Notes shall have been authenticated but not delivered, any such successor to the Indenture Trustee may adopt the certificate of authentication of any predecessor Indenture Trustee and deliver such Notes so authenticated; and in case at that time any of the Notes shall not have been authenticated, any successor to the Indenture Trustee may authenticate such Notes in the name of the successor to the Indenture Trustee; and in all such cases such certificates shall have the full force which it is anywhere in the Notes or in this Indenture provided that the certificate of the Indenture Trustee shall have. Section 6.10. Appointment of Co-Indenture Trustee or Separate ----------------------------------------------- Indenture Trustee. ----------------- (a) Notwithstanding any other provisions of this Indenture, at any time, for the purpose of meeting any legal requirement of any jurisdiction in which any part of the Collateral may at the time be located, the Indenture Trustee shall have the power and may execute and deliver all instruments to appoint one or more Persons to act as a co-trustee or co-trustees, or separate trustee or separate trustees, of all or any part of the Collateral, and to vest in such Person or Persons, in such capacity and for the benefit of the Noteholders, such title to the Collateral, or any part hereof, and, subject to the other provisions of this Section 6.10, such powers, duties, obligations, ------------ rights and trusts as the Indenture Trustee may consider necessary or desirable. No co-trustee or separate trustee hereunder shall be required to meet the terms of eligibility 46 as a successor trustee under Section 6.11 and no notice to Noteholders ------------ of the appointment of any co-trustee or separate trustee shall be required under Section 6.8. ----------- (b) Every separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions: (i) all rights, powers, duties and obligations conferred or imposed upon the Indenture Trustee shall be conferred or imposed upon and exercised or performed by the Indenture Trustee and such separate trustee or co-trustee jointly (it being understood that such separate trustee or co- trustee is not authorized to act separately without the Indenture Trustee joining in such act), except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed the Indenture Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties and obligations (including the holding of title to the Collateral or any portion thereof in any such jurisdiction) shall be exercised and performed singly by such separate trustee or co-trustee, but solely at the direction of the Indenture Trustee; (ii) no trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder; (iii) the Indenture Trustee may at any time accept the resignation of or remove any separate trustee or co-trustee; and (iv) the Indenture Trustee shall not be liable for any act or failure to act on the part of any separate trustee or co-trustee. (c) Any notice, request or other writing given to the Indenture Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co- trustee shall refer to this Indenture and the conditions of this Article VI. Each separate trustee and co-trustee, upon its acceptance ---------- of the trusts conferred, shall be vested with the estates or property specified in its instrument of appointment, either jointly with the Indenture Trustee or separately, as may be provided therein, subject to all the provisions of this Indenture, specifically including every provision of this Indenture relating to the conduct of, affecting the liability of, or affording protection to, the Indenture Trustee. Every such instrument shall be filed with the Indenture Trustee. (d) Any separate trustee or co-trustee may at any time constitute the Indenture Trustee, its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Indenture 47 on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Indenture Trustee, to the extent permitted by law, without the appointment of a new or successor trustee. Section 6.11. Eligibility; Disqualification. The Indenture ----------------------------- Trustee shall at all times satisfy the requirements of TIA (S)310(a). The Indenture Trustee shall have a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition and either its long-term unsecured debt shall be rated at least A3 by Moody's and BBB- by Standard & Poor's or its short-term debt shall be rated at least P-2 by Moody's or A-2 by Standard & Poor's. The Indenture Trustee shall comply with TIA (S)310(b), including the optional provision permitted by the second sentence of TIA (S)310(b)(9); provided, however, that there shall be excluded from the operation of TIA (S)310(b)(1) any indenture or indentures under which other securities of the Issuer are outstanding if the requirements for such exclusion set forth in TIA (S)310(b)(1) are met. Section 6.12. Preferential Collection of Claims Against. The ----------------------------------------- Indenture Trustee shall comply with TIA (S)311(a), excluding any creditor relationship listed in TIA (S)311(b). An Indenture Trustee who has resigned or been removed shall be subject to TIA (S)311(a) to the extent indicated. Section 6.13. Representations and Covenants of the Indenture ---------------------------------------------- Trustee. The Indenture Trustee represents, warrants and covenants that: ------- (i) the Indenture Trustee is a banking corporation duly organized and validly existing under the laws of the State of New York; (ii) The Indenture Trustee has full power and authority to deliver and perform this Indenture and has taken all necessary action to authorize the execution, delivery and performance by it of this Indenture and other Transaction Documents to which it is a party; and (iii) Each of this Indenture and the other Transaction Documents to which it is a party has been duly executed and delivered by the Indenture Trustee and constitutes its legal, valid and binding obligation in accordance with its terms. Section 6.14. Custody of the Collateral. The Indenture Trustee ------------------------- shall hold such of the Trust Estate as consists of instruments, deposit accounts, negotiable documents, money, goods, letters of credit, and advices of credit in the State of Illinois. The Indenture Trustee shall hold such of the Trust Estate as constitutes investment property through a securities intermediary, which securities intermediary 48 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 Illinois. Terms used in the preceding sentence that are defined in the Illinois UCC and not otherwise defined herein shall have the meaning set forth in the Illinois UCC. Except as permitted by this Section 6.14, the Indenture ------------ Trustee shall not hold any part of the Trust Estate through an agent or a nominee. ARTICLE VII NOTEHOLDERS' LIST AND REPORTS BY INDENTURE TRUSTEE AND ISSUER Section 7.1. Issuer to Furnish Indenture Trustee Names and --------------------------------------------- Addresses of Noteholders. The Issuer will furnish or cause to be ------------------------ furnished to the Indenture Trustee (a) upon each transfer of a Note, a list, in such form as the Indenture Trustee may reasonably require, of the names, addresses and taxpayer identification numbers of the Noteholders as they appear on the Note Register as of such Record Date, and (b) at such other times, as the Indenture Trustee may request in writing, within ten (10) days after receipt by the Issuer of any such request, a list of similar form and content as of a date not more than ten (10) days prior to the time such list is furnished; provided, -------- however, that for so long as the Indenture Trustee is the Transfer ------- Agent and Registrar, the Indenture Trustee shall furnish to the Issuer such list in the same manner prescribed in clause (b) above. Section 7.2. Preservation of Information; Communications to ---------------------------------------------- Noteholders. ----------- (a) The Indenture Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of the Noteholders contained in the most recent list furnished to the Indenture Trustee as provided in Section 7.1 and the names, addresses ----------- and taxpayer identification numbers of the Noteholders received by the Indenture Trustee in its capacity as Transfer Agent and Registrar. The 49 Indenture Trustee may destroy any list furnished to it as provided in Section 7.1 upon receipt of a new list so furnished. ----------- (b) Noteholders may communicate, pursuant to TIA (S)312(b), with other Noteholders with respect to their rights under this Indenture or under the Notes. (c) The Issuer, the Indenture Trustee and the Transfer Agent and Registrar shall have the protection of TIA (S)312(c). Section 7.3. Reports by Issuer. ----------------- (a) The Issuer shall: (i) file with the Indenture Trustee, within fifteen (15) days after the Issuer is required to file the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) which the Issuer may be required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act; ---------- ----- (ii) file with the Indenture Trustee and the Commission in accordance with rules and regulations prescribed from time to time by the Commission such additional information, documents and reports with respect to compliance by the Issuer with the conditions and covenants of this Indenture as may be required from time to time by such rules and regulations; and (iii) supply to the Indenture Trustee (and the Indenture Trustee shall transmit by mail to all Noteholders described in TIA (S)313(c)) such summaries of any information, documents and reports required to be filed by the Issuer pursuant to clauses (i) and (ii) of this Section 7.3(a) as may -------------- be required by rules and regulations prescribed from time to time by the Commission. (b) Unless the Issuer otherwise determines, the fiscal year of the Issuer shall end on December 31 of each year. (c) Delivery of such reports, information and documents to the Indenture Trustee is for informational purposes only and the Indenture Trustee's receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including the Issuer's compliance with any of the covenants hereunder. 50 Section 7.4. Reports by Indenture Trustee. If required by TIA ---------------------------- (S)313(a), within sixty (60) days after each March 31 beginning with March 31, 2002, the Indenture Trustee shall mail to each Noteholder as required by TIA (S)313(c) a brief report dated as of such date that complies with TIA (S)313(a). The Indenture Trustee also shall comply with TIA (S)313(b). A copy of each report at the time of its mailing to Noteholders shall be filed by the Indenture Trustee with the Commission and each stock exchange, if any, on which the Notes are listed. The Issuer shall notify the Indenture Trustee if and when the Notes are listed on any stock exchange. ARTICLE VIII ALLOCATION AND APPLICATION OF COLLECTIONS Section 8.1. Collection of Money. Except as otherwise ------------------- expressly provided herein and in the related Indenture Supplement, the Indenture Trustee may demand payment or delivery of, and shall receive and collect, directly and without intervention or assistance of any fiscal agent or other intermediary, all money and other property payable to or receivable by the Indenture Trustee pursuant to this Indenture. The Indenture Trustee shall hold all such money and property received by it in trust for the Noteholders and shall apply it as provided in this Indenture. Except as otherwise expressly provided in this Indenture, if any default occurs in the making of any payment or performance under the Transfer and Servicing Agreement or any other Transaction Document, the Indenture Trustee may, and upon the written request of the Holders of Notes representing more than 50% of the principal balance of the Outstanding Notes of the affected Series shall, subject to Sections 6.1(e) and 6.3(d) take such action as may be --------------- ------ appropriate to enforce such payment or performance, including the institution and prosecution of appropriate Proceedings. Any such action shall be without prejudice to any right to claim a Pay Out Event or a Default or Event of Default under this Indenture and to proceed thereafter as provided in Article V. --------- Section 8.2. Rights of Noteholders. The Collateral shall --------------------- secure the rights of the Holders of the Notes of each Series to receive the portion of Collections allocable to the Noteholders of such Series pursuant to this Indenture and the related Indenture Supplement, funds and other property credited to the Collection Account and the Excess Funding Account (or any subaccount thereof) allocable to the Noteholders of such Series pursuant to this Indenture and such Indenture Supplement, funds and other property credited to any related Series Account and funds available pursuant to any related Series Enhancement, it being understood that, except as specifically set forth in the Indenture Supplement with respect thereto, the 51 Notes of any Series or Class shall not be secured by any interest in any Series Account or Series Enhancement pledged for the benefit of any other Series or Class. Section 8.3. Establishment of Collection Account and Excess ---------------------------------------------- Funding Account. --------------- (a) The Servicer, for the benefit of the Noteholders, shall establish and maintain with the Indenture Trustee or its nominee in the name of the Indenture Trustee, on behalf of the Issuer, a Qualified Account (including any subaccount thereof) bearing a designation clearly indicating that the funds and other property credited thereto are held for the benefit of the Noteholders (the "Collection Account"). ------------------ The Indenture Trustee shall possess all right, title and interest in all monies, instruments, investment property, documents, certificates of deposit and other property credited from time to time to the Collection Account and in all proceeds, earnings, income, revenue, dividends and distributions thereof for the benefit of the Noteholders. The Collection Account shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Noteholders. Except as expressly provided in this Indenture and the Transfer and Servicing Agreement, the Servicer agrees that it shall have no right of setoff or banker's lien against, and no right to otherwise deduct from, any funds held in the Collection Account for any amount owed to it by the Indenture Trustee, the Issuer, any Noteholder or any Series Enhancer. If, at any time, the Collection Account ceases to be a Qualified Account and the same is actually known to a Trustee Officer of the Indenture Trustee, the Indenture Trustee (or the Servicer on its behalf) shall within 15 days (or such longer period, not to exceed thirty (30) calendar days, as to which each Rating Agency may consent) establish a new Collection Account meeting the conditions specified above, transfer any monies, documents, instruments, investment property, certificates of deposit and other property to such new Collection Account and from the date such new Collection Account is established, it shall be the "Collection Account." Pursuant to the ------------------ authority granted to the Servicer in Section 3.1(b) of the Transfer and -------------- Servicing Agreement, the Servicer shall have the power, revocable by the Indenture Trustee, to make withdrawals and payments from the Collection Account and to instruct the Indenture Trustee in writing to make withdrawals and payments from the Collection Account for the purposes of carrying out the Servicer's or the Indenture Trustee's duties hereunder and under the Transfer and Servicing Agreement, as applicable. The Servicer shall reduce deposits into the Collection Account payable by the Seller on any Deposit Date to the extent the Seller is entitled to receive funds from the Collection Account on such Deposit Date. Funds on deposit in the Collection Account (other than investment earnings and amounts deposited pursuant to Section 2.6, 6.1, ------------ --- or 7.1 of the Transfer and --- 52 Servicing Agreement or Section 11.2 of this Indenture) shall at the ------------ written direction of the Servicer be invested by the Indenture Trustee or its nominee in Permitted Investments selected by the Servicer. All such Permitted Investments shall be held by the Indenture Trustee for the benefit of the Noteholders pursuant to Sections 6.14 and 6.1(h). ------------- ------ Investments of funds representing Collections collected during any Monthly Period shall be invested in Permitted Investments that will mature so that such funds will be available no later than the close of business on each monthly Transfer Date following such Monthly Period in amounts sufficient to the extent of such funds to make the required distributions on the following Distribution Date. No such Permitted Investment shall be disposed of prior to its maturity; provided, -------- however, that the Indenture Trustee may sell, liquidate or dispose of ------- any such Permitted Investment before its maturity, at the written direction of the Servicer, if such sale, liquidation or disposal would not result in a loss of all or part of the principal portion of such Permitted Investment or if, prior to the maturity of such Permitted Investment, a default occurs in the payment of principal, interest or any other amount with respect to such Permitted Investment. Unless directed by the Servicer in writing, funds deposited in the Collection Account on a Transfer Date with respect to the immediately succeeding Distribution Date are not required to be invested overnight. On each Distribution Date, all interest and other investment earnings (net of losses and investment expenses) on funds on deposit in the Collection Account shall be treated as Collections of Finance Charge Receivables with respect to the last day of the related Monthly Period, except as otherwise specified in any Indenture Supplement. The Indenture Trustee shall bear no responsibility or liability for any losses resulting from investment or reinvestment of any funds in accordance with this Section ------- 8.3 nor for the selection of Permitted Investments in accordance with --- the provisions of this Indenture and any Indenture Supplement. (b) The Servicer, for the benefit of the Noteholders, shall establish and maintain with the Indenture Trustee or its nominee in the name of the Indenture Trustee, on behalf of the Issuer, a Qualified Account (including any subaccounts thereof) bearing a designation clearly indicating that the funds and other property credited thereto are held for the benefit of the Noteholders (the "Excess Funding -------------- Account"). The Indenture Trustee shall possess all right, title and ------- interest in all monies, instruments, investment property, documents, certificates of deposit and other property credited from time to time to the Excess Funding Account and in all proceeds, dividends distributions, earnings, income and revenue thereof for the benefit of the Noteholders. The Excess Funding Account shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Noteholders. Except as expressly provided in this Indenture and the Transfer and Servicing Agreement, the Servicer agrees that it shall have no right of setoff or banker's lien against, and no right to otherwise deduct from, any funds and other property held in the Excess Funding Account for any amount owed to it by the Indenture Trustee, the 53 Issuer, any Noteholder or any Series Enhancer. If, at any time, the Excess Funding Account ceases to be a Qualified Account and the same is actually known to a Trustee Officer of the Indenture Trustee, the Indenture Trustee (or the Servicer on its behalf) shall within 15 days (or such longer period, not to exceed thirty (30) calendar days, as to which each Rating Agency may consent) establish a new Excess Funding Account meeting the conditions specified above, transfer any monies, documents, instruments, investment property, certificates of deposit and other property to such new Excess Funding Account and from the date such new Excess Funding Account is established, it shall be the "Excess ------ Funding Account." --------------- Funds on deposit in the Excess Funding Account shall at the written direction of the Servicer be invested by the Indenture Trustee in Permitted Investments selected by the Servicer. All such Permitted Investments shall be held by the Indenture Trustee or its nominee (including any securities intermediary) for the benefit of the Noteholders pursuant to Sections 6.14 and 6.1(h). Funds on deposit in ------------- ------ the Excess Funding Account on any Distribution Date will be invested in Permitted Investments that will mature so that such funds will be available no later than the close of business on the next succeeding Transfer Date. No such Permitted Investment shall be disposed of prior to its maturity; provided, however, that the Indenture Trustee may -------- ------- sell, liquidate or dispose of a Permitted Investment before its maturity, at the written direction of the Servicer, if such sale, liquidation or disposal would not result in a loss of all or part of the principal portion of such Permitted Investment or if, prior to the maturity of such Permitted Investment, a default occurs in the payment of principal, interest or any other amount with respect to such Permitted Investment. Unless directed by the Servicer in writing, funds deposited in the Excess Funding Account on a Transfer Date with respect to the immediately succeeding Distribution Date are not required to be invested overnight. On each Distribution Date, all interest and other investment earnings (net of losses and investment expenses) on funds on deposit in the Excess Funding Account shall be treated as Collections of Finance Charge Receivables with respect to the last day of the related Monthly Period except as otherwise specified in the related Indenture Supplement. Section 8.4. Collections and Allocations. From and after the --------------------------- FCMT Termination Date: (a) Collections. The Servicer shall apply or shall instruct ----------- the Indenture Trustee in writing to apply all funds on deposit in the Collection Account as described in this Article VIII and in each ------------ Indenture Supplement. Except as otherwise provided below, the Servicer shall deposit Collections into the Collection Account as promptly as possible after the Date of Processing of such Collections, but in no event later than the second Business Day following the Date of Processing. Subject to the express terms of any Indenture Supplement, but notwithstanding anything else 54 in this Indenture or the Transfer and Servicing Agreement to the contrary, for so long as FCNB shall remain the Servicer and no Servicer Default has occurred and is continuing and either (i) the Servicer provides to the Indenture Trustee a letter of credit or other arrangement covering risk of collection of the Servicer and the Servicer shall have satisfied the Rating Agency Condition with respect to such arrangement or (ii) the Servicer (unless the Rating Agency Condition shall have been satisfied with respect to making monthly deposits) shall have and maintain a certificate of deposit or short- term deposit rating of P-1 by Moody's and of at least A-1 by Standard & Poor's and deposit insurance as required by law and by the FDIC, the Servicer need not make the daily deposits of Collections into the Collection Account as provided in the preceding sentence, but may make a single deposit in the Collection Account in immediately available funds on the Transfer Date following the Monthly Period with respect to which such deposit relates. Notwithstanding anything else in this Indenture or the Transfer and Servicing Agreement to the contrary, with respect to any Monthly Period, whether the Servicer is required to make deposits of Collections pursuant to the first or the second preceding sentence, (i) the Servicer will only be required to deposit Collections into the Collection Account up to the aggregate amount of Collections required to be deposited into any Series Account or, without duplication, distributed on or prior to the related Distribution Date to Noteholders or to any Series Enhancer pursuant to the terms of any Indenture Supplement or Enhancement Agreement, but the Servicer shall account for Collections as if the full deposit had been made and (ii) if at any time prior to such Distribution Date the amount of Collections deposited in the Collection Account exceeds the amount required to be deposited pursuant to clause (i) above, the Servicer ---------- will be permitted to withdraw the excess from the Collection Account and pay such amount to the Holder of the Seller Interest. Subject to the immediately preceding sentence, the Servicer may retain its Servicing Fee with respect to a Series and shall not be required to deposit it in the Collection Account. (b) Series and Seller Allocations. Finance Charge ----------------------------- Collections, Collections of Principal Receivables and Defaulted Receivables will be allocated to each Series of Notes and to the Holders of the Seller Interest in accordance with this Article VIII and ------------ each Indenture Supplement, and amounts so allocated to any Series will not, except as specified in the related Indenture Supplement, be available to the Noteholders of any other Series. All Finance Charge Collections, Collections of Principal Receivables and Defaulted Receivables not so allocated to any Series of Notes shall be allocated and (in the case of Collections) paid to the Holder of the Seller Interest, except as otherwise provided in Section 8.4(g). -------------- (c) Allocation of Collections Between Finance Charge ------------------------------------------------ Receivables and Principal Receivables. On each Business Day, the ------------------------------------- Servicer shall allocate Collections processed on the Accounts as Finance Charge Collections as set forth in Section 1.3 of the Transfer ----------- and Servicing Agreement, or, in the case of Discount Option 55 Receivables, Finance Charge Collections as set forth in Section 2.8(b) -------------- of the Transfer and Servicing Agreement. In addition all Collections which constitute Net Recoveries, investment earnings (net of investment expenses and losses) on the Collection Account and the Excess Funding Account shall be treated as Finance Charge Collections and allocated accordingly. The balance of the Collections processed on any Business Day shall be allocated to Principal Receivables. (d) Allocation of Collections of Recoveries and Defaulted ----------------------------------------------------- Amounts. On each Determination Date, the Servicer shall calculate the ------- Investor Default Amount and the amount of Net Recoveries, if any, for the preceding Monthly Period with respect to each Series. (e) Adjustments for Miscellaneous Credits. The Servicer ------------------------------------- shall be obligated to reduce or adjust, as the case may be, on a net basis, the aggregate amount of Principal Receivables used to calculate the Seller Amount as provided in this Section 8.4(e) (a "Credit -------------- ------ Adjustment") with respect to any Principal Receivable (i) which was ---------- created in respect of merchandise refused or returned by the Obligor thereunder, (ii) which is reduced by the Servicer by any rebate, refund, chargeback or adjustment, (iii) as to which the Obligor thereunder has asserted a counterclaim or defense and either (x) the Servicer has agreed such counterclaim or defense is valid or (y) a final nonappealable judgment or decree has been entered in favor of such Obligor in respect of such counterclaim or defense by a court or arbitral body having jurisdiction thereof, or (iv) which the Servicer has determined was created through a fraudulent or counterfeit charge, but only if and to the extent such fraudulent or counterfeit charges are not included as charge-offs under the Cardholder Guidelines. In the event that the exclusion of the amount of a Credit Adjustment from the calculation of the Seller Amount would cause the Seller Amount to be less than the Minimum Seller Amount, Seller shall make a deposit, no later than the Business Day following the Date of Processing of such Credit Adjustment, in the Excess Funding Account in immediately available funds, in an amount equal to the Shortfall Amount, after giving effect to such exclusion. Such deposit shall be applied in accordance with this Article VIII and the Indenture ------------ Supplements and treated as a Principal Collection for all purposes hereof and thereof. (f) Net Payments. So long as FCNB is the Servicer and FCNB, ------------ as Servicer, is making daily deposits to the Collection Account in accordance with Section 8.4(a), FCNB, acting as Servicer and as agent -------------- for the Holder of the Seller Interest, may make a net payment to the Collection Account on each Deposit Date in the amount of all Collections received by the Servicer since the previous Deposit Date, minus all amounts payable to the Holder of the Seller Interest on or before such day in accordance with this Article VIII and the Indenture ------------ Supplements. 56 (g) Unallocated Collections; Excess Funding Account. On ----------------------------------------------- each Business Day, Principal Collections allocable to the Seller Interest (including Shared Principal Collections and Excess Finance Charge Collections payable to the Holders of the Seller Interest) in an aggregate amount equal to the Shortfall Amount shall be deposited in the Excess Funding Account. Thereafter, amounts in the Excess Funding Account shall be treated as Shared Principal Collections to the extent that, after giving effect to the application of such amount as Shared Principal Collections to the extent provided in any Indenture Supplement, the Seller Amount would equal or exceed the Minimum Seller Amount. (h) Allocation of Deposit Obligations. If the Seller or the --------------------------------- Servicer shall fail to make any Deposit Obligation, the amount thereof shall first be allocated to reduce the Seller Amount until the Seller Amount equals the Minimum Seller Amount. Any remaining shortfall shall be allocated to each Series ratably based upon a fraction the numerator of which is the Allocation Percentage used by such Series to allocate Default Amounts and the denominator of which is the sum of all such numerators of all Series outstanding (such allocated amount, the "Series Share" of such shortfall). The Series Share of each series that ------------ specifies a Minimum Seller Percentage greater than zero shall be allocated to reduce the Seller Amount and any Collections otherwise allocable to the Seller Amount and the balance on deposit in the Excess Funding Account shall be available on a ratable basis to such Series to cover any shortfalls arising from such failure; provided to the extent the Seller Amount falls below zero, any portion of the Series Share of any such Series that is not covered as described above shall be allocated to such Series. The Series Share of each Series that specifies a Minimum Seller Percentage of zero shall be allocated to such series. Section 8.5. Shared Principal Collections. From and after the ---------------------------- FCMT Termination Date, on each Distribution Date, (a) the Servicer shall allocate Shared Principal Collections (as described below) to each Principal Sharing Series, pro rata, in proportion to the Principal Shortfalls (as described below), if any, with respect to each such Series and (b) the Servicer shall withdraw from the Collection Account an amount equal to the excess, if any, of (i) the aggregate amount for all outstanding Series of Collections of Principal Receivables which the related Indenture Supplements specify are to be treated as "Shared ------ Principal Collections" for such Distribution Date over (ii) the -------------------- aggregate amount for all outstanding Series which the related Indenture Supplements specify are "Principal Shortfalls" for such Series and for ------------------- such Distribution Date and shall (A) deposit such funds into the Excess Funding Account in an aggregate amount equal to the Shortfall Amount in accordance with Section 8.4(g) and (B) pay any remaining amount to the -------------- Holders of the Seller Interest. The Seller may, at its option, instruct the Indenture Trustee in writing to deposit 57 Shared Principal Collections which are otherwise payable to the holders of the Seller Interest pursuant to the provisions set forth above into the Excess Funding Account. Section 8.6. Excess Finance Charge Collections. From and after --------------------------------- the FCMT Termination Date, on each Distribution Date, (a) the Servicer shall allocate Excess Finance Charge Collections (as described below) to each Excess Allocation Series, pro rata, in proportion to the Finance Charge Shortfalls (as described below), if any, with respect to each such Series and (b) the Servicer shall withdraw from the Collection Account an amount equal to the excess, if any, of (x) the aggregate amount for all outstanding Series of Collections of Finance Charge Receivables which the related Supplements specify are to be treated as "Excess Finance Charge Collections" for such Distribution --------------------------------- Date over (y) the aggregate amount for all outstanding Series which the related Supplements specify are "Finance Charge Shortfalls" for such ------------------------- Series and such Distribution Date and shall (A) deposit such funds into the Excess Funding Account in an aggregate amount equal to the Shortfall Amount in accordance with Section 8.4(g) and (b) pay any ------ --- remaining amount to the holders of the Seller Interest; provided, -------- however, that the sharing of Excess Finance Charge Collections among ------- Series will continue only until such time, if any, at which the Seller shall deliver to the Indenture Trustee an Officer's Certificate to the effect that, in the reasonable belief of the Seller, the continued sharing of Excess Finance Charge Collections among Series would have adverse regulatory implications with respect to the Seller. Notwithstanding the foregoing, a Group of Series may specify in their related Indenture Supplements that Excess Finance Charge Collections from such Series shall be allocated as provided above but only among the Series in such Group. Section 8.7. Allocation of Collateral to Series or Groups. To -------------------------------------------- the extent so provided in the Indenture Supplement for any Series or in an Indenture Supplement otherwise executed pursuant to Section 10.1, ------------ Receivables conveyed to the Issuer pursuant to Section 2.1 of the ----------- Transfer and Servicing Agreement and Receivables conveyed to the Issuer pursuant to Section 2.9 of the Transfer and Servicing Agreement and all ----------- Collections received with respect thereto may be allocated or applied in whole or in part to one or more Series or Groups as may be provided in such Indenture Supplement; provided, however, that any such -------- ------- allocation or application shall be effective only upon satisfaction of the following conditions: (i) on or before the fifth Business Day immediately preceding such allocation, the Servicer shall have given the Indenture Trustee and each Rating Agency written notice of such allocation; (ii) the Rating Agency Condition shall have been satisfied with respect to such allocation; and 58 (iii) the Servicer shall have delivered to the Indenture Trustee an Officer's Certificate, dated the date of such allocation, to the effect that the Servicer reasonably believes that such allocation will not have an Adverse Effect. Any such Indenture Supplement may provide that (i) such allocation to one or more particular Series or Groups may terminate upon the occurrence of certain events specified therein and (ii) that upon the occurrence of any such event, such assets and any Collections with respect thereto, shall be reallocated to other Series or Groups or to all Series, all as shall be provided in such Indenture Supplement. Section 8.8. Release of Collateral; Eligible Loan Documents. ---------------------------------------------- (a) Upon the written direction of the Issuer, the Indenture Trustee may, and when required by the provisions of this Indenture shall, execute instruments to release property from the lien of this Indenture, or convey the Indenture Trustee's interest in the same, in a manner and under circumstances which are not inconsistent with the provisions of this Indenture. No party relying upon an instrument executed by the Indenture Trustee as provided in this Article VIII ------------ shall be bound to ascertain the Indenture Trustee's authority, inquire into the satisfaction of any conditions precedent or see to the application of any monies. (b) In order to facilitate the servicing of the Receivables by the Servicer, the Indenture Trustee upon Issuer Order shall authorize the Servicer to execute in the name and on behalf of the Indenture Trustee instruments of satisfaction or cancellation, or of partial or full release or discharge, and other comparable instruments with respect to the Receivables (and the Indenture Trustee shall execute any such documents on written request of the Servicer), subject to the obligations of the Servicer under the Transfer and Servicing Agreement. (c) The Indenture Trustee shall, at such time as there are no Notes outstanding, release and transfer, without recourse, all of the Collateral that secured the Notes (other than any cash held for the payment of the Notes pursuant to Section 4.2). The Indenture Trustee ------------ shall release property from the lien of this Indenture pursuant to this Section 8.9(c) only upon receipt of an Issuer Order accompanied by an -------------- Officer's Certificate, an Opinion of Counsel and (if required by the TIA) Independent Certificates in accordance with TIA (S)314(c) and 314(d)(1) meeting the applicable requirements of Section 12.1. ------------- (d) Notwithstanding anything to the contrary in this Indenture, the Transfer and Servicing Agreement and the Trust Agreement, immediately prior to the release of any portion of the Collateral or any funds on deposit in the Series Accounts pursuant to this Indenture, the Indenture Trustee shall at the written request of the 59 Issuer remit to the Seller for its own account any funds that, upon such release, would otherwise be remitted to the Issuer. Section 8.9. Opinion of Counsel. The Indenture Trustee shall ------------------ receive at least seven (7) days notice when requested by the Issuer to take any action pursuant to Section 8.8(a), accompanied by copies of -------------- any instruments involved, and the Indenture Trustee shall also require, as a condition to such action, an Opinion of Counsel, in form and substance reasonably satisfactory to the Indenture Trustee, stating the legal effect of any such action, outlining the steps required to complete the same, and concluding that all conditions precedent to the taking of such action have been complied with and such action will not materially and adversely impair the security for the Notes or the rights of the Noteholders in contravention of the provisions of this Indenture; provided, however, that such Opinion of Counsel shall not be -------- ------- required to express an opinion as to the fair value of the Collateral. The Indenture Trustee and counsel rendering any such opinion may conclusively rely, without independent investigation, on the accuracy and validity of any certificate or other instrument delivered to the Indenture Trustee in connection with any such action. ARTICLE IX DISTRIBUTIONS AND REPORTS TO NOTEHOLDERS Distributions shall be made to, and reports shall be provided to, Noteholders as set forth in the applicable Indenture Supplement. The identity of the Noteholders with respect to distributions and reports shall be determined according to the immediately preceding Record Date. ARTICLE X SUPPLEMENTAL INDENTURES Section 10.1. Supplemental Indentures Without Consent of ------------------------------------------ Noteholders. ----------- (a) Without the consent of the Holders of any Notes but with prior notice to each Rating Agency with respect to the Notes of all Series rated by such Rating Agency, the Issuer and the Indenture Trustee, when authorized by an Issuer Order, at any time and from time to time, may enter into one or more indentures supplemental hereto (which shall conform to the provisions of the TIA as in force at the date of the execution thereof), in form satisfactory to the Indenture Trustee, for any of the following purposes: 60 (i) to correct or amplify the description of any property at any time subject to the lien of this Indenture, or better to assure, convey and confirm unto the Indenture Trustee any property subject or required to be subjected to the lien of this Indenture, or to subject to the lien of this Indenture additional property; (ii) to evidence the succession, in compliance with Section 3.11, of another person to the Issuer, and the ------------ assumption by any such successor of the covenants of the Issuer contained herein and in the Notes; (iii) to add to the covenants of the Issuer, for the benefit of the Holders of the Notes, or to surrender any right or power herein conferred upon the Issuer; (iv) to convey, transfer, assign, mortgage or pledge any property to or with the Indenture Trustee; (v) to cure any ambiguity, to correct or supplement any provision herein or in any supplemental indenture that may be inconsistent with any other provision herein or in any supplemental indenture or to make any other provisions with respect to matters or questions arising under this Indenture or in any supplemental indenture; provided that -------- such action shall not adversely affect the interests of the Holders of the Notes; (vi) to evidence and provide for the acceptance of the appointment hereunder by a successor indenture trustee with respect to the Notes and to add to or change any of the provisions of this Indenture as shall be necessary to facilitate the administration of the trusts hereunder by more than one indenture trustee, pursuant to the requirements of Article VI; ---------- (vii) to modify, eliminate or add to the provisions of this Indenture to such extent as shall be necessary to effect the qualification of this Indenture under the TIA or under any similar federal statute hereafter enacted and to add to this Indenture such other provisions as may be expressly required by the TIA; (viii) to provide for the issuance of one or more new Series of Notes, in accordance with the provisions of Section ------- 2.12; or ---- (ix) to provide for the termination of any interest rate swap agreement or other form of credit enhancement or maturity guarantee agreement in accordance with the provisions of the related Indenture Supplement. 61 The Indenture Trustee is hereby authorized to join in the execution of any such supplemental indenture and to make any further appropriate agreements and stipulations that may be therein contained. (b) The Issuer and the Indenture Trustee, when authorized by an Issuer Order, may, also without the consent of any Noteholders of any Series then Outstanding but upon satisfaction of the Rating Agency Condition with respect to the Notes of all Series, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying in any manner the rights of the Holders of the Notes under this Indenture; provided, however -------- ------- that the Seller shall have delivered to the Owner Trustee and the Indenture Trustee an Officer's Certificate, dated the date of any such action, stating that all requirements for such amendments contained in the Agreement have been met and the Seller reasonably believes that such action will not have an Adverse Effect. Additionally, notwithstanding the preceding sentence, the Issuer and the Indenture Trustee, when authorized by an Issuer Order, may, without the consent of any Noteholders of any Series then Outstanding or the Series Enhancers for any Series, enter into an indenture or indentures supplemental hereto to add, modify or eliminate such provisions as may be necessary or advisable in order to enable all or a portion of the Issuer (i) to qualify as, and to permit an election to be made to cause the Issuer to be treated as, a "financial asset securitization investment trust" as described in the provisions of Section 860L of the Code, and (ii) to avoid the imposition of state or local income or franchise taxes imposed on the Issuer's property or its income; provided, however, that (i) the Seller delivers to the Indenture -------- ------- Trustee and the Owner Trustee an Officer's Certificate to the effect that the proposed amendments meet the requirements set forth in this Section 10.1(b), (ii) the Rating Agency Condition will have been --------------- satisfied and (iii) such amendment does not affect the rights, duties, protections, indemnities, immunities or obligations of the Indenture Trustee or the Owner Trustee hereunder. The amendments which the Seller may make without the consent of Noteholders pursuant to the preceding sentence may include the addition or sale of Receivables. Section 10.2. Supplemental Indentures with Consent of --------------------------------------- Noteholders. The Issuer and the Indenture Trustee, when authorized by ----------- an Issuer Order, also may, upon satisfaction of the Rating Agency Condition and with the consent of the Holders of Notes representing more than 66-2/3% of the principal balance of the Outstanding Notes of each adversely affected Series, by Act of such Holders delivered to the Issuer and the Indenture Trustee, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of such Noteholders under this Indenture; provided, however that no such supplemental -------- ------- indenture shall, without the consent of the Holder of each outstanding Note affected thereby: 62 (a) change the due date of any installment of principal of or interest on any Note, or reduce the principal amount thereof, the interest rate specified thereon or the redemption price with respect thereto or change any place of payment where, or the coin or currency in which, any Note or any interest thereon is payable; (b) impair the right to institute suit for the enforcement of the provisions of this Indenture requiring the application of funds available therefor, as provided in Article V, to the payment of any --------- such amount due on the Notes on or after the respective due dates thereof (or, in the case of redemption, on or after the Redemption Date); (c) reduce the percentage of the Outstanding Notes of any Series the consent of the Holders of which is required for any such supplemental indenture, or the consent of the Holders of which is required for any waiver of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences as provided for in this Indenture; (d) reduce the percentage of the Outstanding Notes of any Series, the consent of the Holders of which is required to direct the Indenture Trustee to sell or liquidate the Collateral if the proceeds of such sale would be insufficient to pay the principal amount and accrued but unpaid interest on the outstanding Notes of such Series; (e) decrease the percentage of the Outstanding Notes required to amend the sections of this Indenture which specify the applicable percentage of the Outstanding Notes of any Series necessary to amend the Indenture or any Transaction Documents which require such consent; (f) modify or alter the provisions of this Indenture prohibiting the voting of Notes held by the Issuer, any other Obligor on the Notes, a Seller or any affiliate thereof; or (g) permit the creation of any Lien ranking prior to or on a parity with the lien of this Indenture with respect to any part of the Collateral for any Notes or, except as otherwise permitted or contemplated herein, terminate the Lien of this Indenture on any such Collateral at any time subject hereto or deprive the Holder of any Note of the security provided by the Lien of this Indenture. The Indenture Trustee may in its discretion determine whether or not any Notes would be affected by any supplemental indenture and any such determination shall be conclusive upon the Holders of all Notes, whether theretofore or thereafter 63 authenticated and delivered hereunder. The Indenture Trustee shall not be liable for any such determination made in good faith. Satisfaction of the Rating Agency Condition shall not be required with respect to the execution of any supplemental indenture pursuant to this Section 10.2 for which the consent of all of the ------------ affected Noteholders is required. It shall not be necessary for any Act of Noteholders under this Section 10.2 to approve the particular form of any proposed ------------ supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof. Promptly after the execution by the Issuer and the Indenture Trustee of any supplemental indenture pursuant to this Section 10.2, ------------ the Indenture Trustee shall mail to the Holders of the Notes to which such amendment or supplemental indenture relates written notice setting forth in general terms the substance of such supplemental indenture. Any failure of the Indenture Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture. Section 10.3. Execution of Supplemental Indentures. In ------------------------------------ executing, or permitting the additional trusts created by, any supplemental indenture permitted by this Article X or the modification --------- thereby of the trusts created by this Indenture, the Indenture Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture and stating that all requisite consents have been obtained or that no consents are required and stating that such supplemental indenture or modification constitutes the legal, valid and binding obligation of the Issuer in accordance with its terms. The Indenture Trustee may, but shall not be obligated to, enter into any such supplemental indenture that affects the Indenture Trustee's own rights, duties, liabilities or immunities under this Indenture or otherwise. Section 10.4. Effect of Supplemental Indenture. Upon the -------------------------------- execution of any supplemental indenture under this Article X, this --------- Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes, and every Holder of Notes theretofore or thereafter authenticated and delivered hereunder shall be bound thereby. This Section 10.4 does not apply to Indenture Supplements. ------------ Section 10.5. Conformity With Trust Indenture Act. Every ----------------------------------- amendment of this Indenture and every supplemental indenture executed pursuant to this Article X shall conform to the requirements of the TIA --------- as then in effect so long as this Indenture shall then be qualified under the TIA. 64 Section 10.6. Reference in Notes to Supplemental Indentures. --------------------------------------------- Notes authenticated and delivered after the execution of any supplemental indenture pursuant to this Article X may, and if required --------- by the Indenture Trustee shall, bear a notation in form approved by the Indenture Trustee as to any matter provided for in such supplemental indenture. If the Issuer shall so determine, new Notes so modified as to conform, in the opinion of the Indenture Trustee and the Issuer, to any such supplemental indenture may be prepared and executed by the Issuer and authenticated and delivered by the Indenture Trustee in exchange for the outstanding Notes. ARTICLE XI TERMINATION Section 11.1. Termination of Issuer. The Issuer and the --------------------- respective obligations and responsibilities of the Indenture Trustee created hereby (other than the obligation of the Indenture Trustee to make payments to Noteholders as hereinafter set forth) shall terminate, except with respect to the duties described in Section 11.2(b), as --------------- provided in the Trust Agreement. Section 11.2. Final Distribution. ------------------ (a) The Servicer shall give the Indenture Trustee and the Rating Agencies at least thirty (30) days prior written notice of the Distribution Date on which the Noteholders of any Series or Class may surrender their Notes for payment of the final distribution on and cancellation of such Notes (or, in the event of a final distribution resulting from the application of Section 2.6 of the Transfer and ----------- Servicing Agreement, notice of such Distribution Date promptly after the Servicer has determined that a final distribution will occur, if such determination is made less than thirty (30) days prior to such Distribution Date). Such notice shall be accompanied by an Officer's Certificate setting forth the information specified in Section 3.5 of ----------- the Transfer and Servicing Agreement covering the period during the then-current calendar year through the date of such notice. Not later than the fifth day of the month in which the final distribution in respect of such Series or Class is payable to Noteholders, the Indenture Trustee shall provide notice to Noteholders of such Series or Class specifying (i) the date upon which final payment of such Series or Class will be made upon presentation and surrender of Notes of such Series or Class at the office or offices therein designated, (ii) the amount of any such final payment and (iii) that the Record Date otherwise applicable to such payment date is not applicable, payments being made only upon presentation and surrender of such Notes at the office or offices therein specified (which in the case of Bearer Notes shall be outside 65 the United States). The Indenture Trustee shall give such notice to the Transfer Agent and Registrar and the Paying Agent at the time such notice is given to Noteholders. (b) Notwithstanding a final distribution to the Noteholders of any Series or Class (or the termination of the Issuer), except as otherwise provided in this paragraph, all funds then on deposit in the Collection Account and any Series Account allocated to such Noteholders shall continue to be held in trust for the benefit of such Noteholders and the Paying Agent or the Indenture Trustee shall pay such funds to such Noteholders upon surrender of their Notes, if certificated (and any excess shall be paid in accordance with the terms of any Enhancement Agreement). In the event that all such Noteholders shall not surrender their Notes for cancellation within six (6) months after the date specified in the notice from the Indenture Trustee described in paragraph (a), the Indenture Trustee shall give a second notice to the remaining such Noteholders to surrender their Notes for cancellation and receive the final distribution with respect thereto (which surrender and payment, in the case of Bearer Notes, shall be outside the United States). If within one year after the second notice all such Notes shall not have been surrendered for cancellation, the Indenture Trustee may take appropriate steps, or may appoint an agent to take appropriate steps, to contact the remaining such Noteholders concerning surrender of their Notes, and the cost thereof shall be paid out of the funds in the Collection Account or any Series Account held for the benefit of such Noteholders. The Indenture Trustee and, upon the written request of the Servicer, the Paying Agent shall pay to the Issuer any monies held by them for the payment of principal or interest that remains unclaimed for two (2) years. After payment to the Issuer, Noteholders entitled to the money must look to the Issuer for payment as general creditors unless an applicable abandoned property law designates another Person. Section 11.3. Issuer's Termination Rights. Upon the --------------------------- termination of the Issuer pursuant to the terms of the Trust Agreement and upon the written direction of the Issuer, the Indenture Trustee shall assign and convey to the Holders of the Seller Interest or any of their designees, without recourse, representation or warranty, all right, title and interest of the Issuer in the Receivables, whether then existing or thereafter created, all Recoveries related thereto all monies due or to become due and all amounts received or receivable with respect thereto (including all moneys then held in the Collection Account or any Series Account) and all proceeds thereof, except for amounts held by the Indenture Trustee pursuant to Section 11.2(b). The --------------- Indenture Trustee shall execute and deliver such instruments of transfer and assignment, in each case without recourse, as shall be reasonably requested in writing by the Holders of the Seller Interest to vest in the Holders of the Seller Interest or any of their designees all right, title and interest which the Indenture Trustee had in the Collateral and such other property. 66 ARTICLE XII MISCELLANEOUS Section 12.1. Compliance Certificates and Opinions etc. ---------------------------------------- (a) Upon any application or request by the Issuer to the Indenture Trustee to take any action under any provision of this Indenture, the Issuer shall furnish to the Indenture Trustee (i) an Officer's Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and (ii) (if required by the TIA) an Independent Certificate from a firm of certified public accountants meeting the applicable requirements of this Section 12.1, except that, in the case ------------ of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture, no additional certificate or opinion need be furnished. Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: (i) a statement that each signatory of such certificate or opinion has read or has caused to be read such covenant or condition and the definitions herein relating thereto; (ii) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (iii) a statement that, in the opinion of each such signatory, such signatory has made such examination or investigation as is necessary to enable such signatory to express an informed opinion as to whether or not such covenant or condition has been complied with; and (iv) a statement as to whether, in the opinion of each such signatory, such condition or covenant has been complied with. (b) Other than with respect to the release of any Receivables in Removed Accounts, whenever any property or investment property is to be released from the lien of this Indenture, the Issuer shall also furnish to the Indenture Trustee an Officer's Certificate certifying or stating the opinion of each person signing such certificate as to the fair value (within ninety (90) days of such release) of the property or securities proposed to be released and stating that in the opinion of such person the proposed release will not impair the security under this Indenture in contravention of the provisions hereof. 67 (i) Notwithstanding any other provision of this Section 12.1, the Issuer may (A) collect, liquidate, sell or ------------ otherwise dispose of Receivables as and to the extent permitted or required by the Transaction Documents and (B) make cash payments out of the Series Accounts as and to the extent permitted or required by the Transaction Documents. Section 12.2. Form of Documents Delivered to Indenture Trustee. ------------------------------------------------ In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents. Any certificate or opinion of a Responsible Officer of the Issuer may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which such officer's certificate or opinion is based are erroneous. Any such certificate of a Responsible Officer or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Servicer, a Seller, the Issuer or the Administrator, stating that the information with respect to such factual matters is in the possession of the Servicer, a Seller, the Issuer or the Administrator, unless such Responsible Officer or Counsel has actual knowledge that the certificate or opinion or representations with respect to such matters are erroneous. Where any Person is required to make, give or execute two (2) or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument. Whenever in this Indenture, in connection with any application or certificate or report to the Indenture Trustee, it is provided that the Issuer shall deliver any document as a condition of the granting of such application, or as evidence of the Issuer's compliance with any term hereof, it is intended that the truth and accuracy, at the time of the granting of such application or at the effective date of such certificate or report (as the case may be), of the facts and opinions stated in such document shall in such case be conditions precedent to the right of the Issuer to have such application granted or to the sufficiency of such certificate or report. The foregoing shall not, however, be construed to affect the Indenture Trustee's right to 68 conclusively rely upon the truth and accuracy of any statement or opinion contained in any such document as provided in Article VI. ---------- Section 12.3. Acts of Noteholders. ------------------- (a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Noteholders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Noteholders in person or by their agents duly appointed in writing and satisfying any requisite percentages as to minimum number or dollar value of outstanding principal amount represented by such Noteholders; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Indenture Trustee, and, where it is hereby expressly required, to the Issuer. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the "Act" of --- the Noteholders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and conclusive in favor of the Indenture Trustee and the Issuer, if made in the manner provided in this Section 12.3. ------------ (b) The fact and date of the execution by any Person of any such instrument or writing may be proved in any manner which the Indenture Trustee deems sufficient. (c) The ownership of Notes shall be proved by the Note Register. (d) Any request, demand, authorization, direction, notice, consent, waiver or other action by the Holder of any Notes shall bind the Holder (and any transferee thereof) of every Note issued upon the registration thereof in exchange therefor or in lieu thereof, in respect of anything done, omitted or suffered to be done by the Indenture Trustee or the Issuer in reliance thereon, whether or not notation of such action is made upon such Note. Section 12.4. Notices, Etc. to Indenture Trustee and Issuer. --------------------------------------------- Any request, demand, authorization, direction, notice, consent, waiver or Act of Noteholders or other documents provided or permitted by the Agreement to be made upon, given or furnished to, or filed with: (a) the Indenture Trustee by any Noteholder or by the Issuer shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to a Trustee Officer, by facsimile transmission or by other means acceptable to the Indenture Trustee to or with the Indenture Trustee at its Corporate Trust Office; or 69 (b) the Issuer by the Indenture Trustee or by any Noteholder shall be sufficient for every purpose hereunder if in writing and mailed, first-class postage prepaid, to the Issuer addressed to it and received by it c/o Bankers Trust Company, Four Albany Street, 10th Floor, New York, New York 10006, Attn: Corporate Trust and Agency Services, or at any other address previously furnished in writing to the Indenture Trustee by the Issuer. A copy of each notice to the Issuer shall be sent in writing and mailed, first-class postage prepaid, to the Administrator at First Consumers National Bank, 9300 S.W. Gemini Drive, Beaverton, Oregon 97008, Attn.: President. Section 12.5. Notices to Noteholders; Waiver. Where the ------------------------------ Indenture provides for notice to Noteholders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed by registered or certified mail or first class postage prepaid or national overnight courier service to each Noteholder affected by such event, at its address as it appears on the Note Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice. In any case where notice to Noteholders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Noteholder shall affect the sufficiency of such notice with respect to other Noteholders, and any notice which is mailed in the manner herein provided shall conclusively be presumed to have been duly given. Where this Indenture provides for notice in any manner, such notice may be waived in writing by any Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Noteholders shall be filed with the Indenture Trustee but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. In the event that, by reason of the suspension of regular mail service as a result of a strike, work stoppage or similar activity, it shall be impractical to mail notice of any event to Noteholders when such notice is required to be given pursuant to any provision of this Indenture, then any manner of giving such notice as shall be satisfactory to the Indenture Trustee shall be deemed to be a sufficient giving of such notice. Where this Indenture provides for notice to any Rating Agency, failure to give such notice shall not affect any other rights or obligations created hereunder and shall not under any circumstance constitute a Default or Event of Default. Section 12.6. Alternate Payment and Notice Provisions. --------------------------------------- Notwithstanding any provision of this Indenture or any of the Notes to the contrary, the Issuer, with the prior written consent of the Indenture Trustee, may enter into any agreement with any Holder of a Note providing for a method of payment, or notice by the Indenture 70 Trustee or any Paying Agent to such Holder, that is different from the methods provided for in this Indenture for such payments or notices. The Issuer will furnish to the Indenture Trustee a copy of each such agreement and the Indenture Trustee will cause payments to be made and notices to be given in accordance with such agreements. Section 12.7. Conflict with Trust Indenture Act. If any provision --------------------------------- hereof limits, qualifies or conflicts with another provision hereof that is required to be included in this indenture by any of the provisions of the TIA, such required provision shall control. The provisions of TIA (S)(S) 310 through 317 that impose duties on any person (including the provisions automatically deemed included herein unless expressly excluded by this Indenture) are a part of and govern this Indenture, whether or not physically contained herein. Section 12.8. Effect of Headings and Table of Contents. The Article ---------------------------------------- and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. Section 12.9. Successors and Assigns. All covenants and agreements ---------------------- in this Indenture by the Issuer shall bind its successors and assigns, whether so expressed or not. Section 12.10. Separability. In case any provision in this Indenture ------------ or in the Notes shall be invalid, illegal or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. Section 12.11. Benefits of Indenture. Nothing in this Indenture or in --------------------- the Notes, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder, and the Noteholders, the Servicer and the Seller, any benefit. Section 12.12. Legal Holidays. In any case where the date on which -------------- any payment is due shall not be a Business Day, then (notwithstanding any other provision of the Notes or this Indenture) payment need not be made on such date, but may be made on the next succeeding Business Day with the same force and effect as if made on the date on which nominally due, and no interest shall accrue for the period from and after any such nominal date. Section 12.13. GOVERNING LAW. THIS INDENTURE AND EACH NOTE SHALL BE ------------- CONSTRUED IN ACCORDANCE WITH AND GOVERNED 71 BY THE LAWS OF THE STATE OF ILLINOIS APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED THEREIN; PROVIDED, HOWEVER, THAT THE DUTIES AND OBLIGATIONS OF THE INDENTURE TRUSTEE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS CHOICE OF LAW PROVISIONS. Section 12.14. Counterparts. This Indenture may be executed in any ------------ number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. Section 12.15. Issuer Obligation. No recourse may be taken, directly ----------------- or indirectly, with respect to the obligations of the Issuer, the Owner Trustee or the Indenture Trustee on the Notes or under this Indenture or any certificate or other writing delivered in connection herewith or therewith, against (i) the Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a beneficial interest in the Issuer or (iii) any partner, owner, beneficiary, agent, officer, director, employee or agent of the Indenture Trustee or the Owner Trustee in its individual capacity, any holder of a beneficial interest in the Issuer, the Owner Trustee or the Indenture Trustee or of any successor or assign of the Indenture Trustee or the Owner Trustee in its individual capacity, except as any such Person may have expressly agreed (it being understood that the Indenture Trustee and the Owner Trustee have no such obligations in their individual capacity) and except that any such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock, unpaid capital contribution or failure to pay any installment or call owing to such entity. For all purposes of this Indenture, in the performance of any duties or obligations of the Issuer hereunder, the Owner Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of Articles V, VI and VII of the ---------- -- --- Trust Agreement. Section 12.16. No Petition. The Indenture Trustee, by entering into ----------- this Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree that they will not at any time institute against the Issuer or First Consumers Master Trust, or join in instituting against the Issuer or First Consumers Master Trust any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law. 72 IN WITNESS WHEREOF, the Issuer and the Indenture Trustee have caused this Indenture to be duly executed by their respective officers thereunto duly authorized and attested, all as of the day and year first above written. FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, as Issuer By: Bankers Trust Company, not in its individual capacity, but solely as Owner Trustee By: /s/ Eileen M. Hughes -------------------- Name: Eileen M. Hughes Title: Vice President THE BANK OF NEW YORK, as Indenture Trustee By: /s/ Greg Anderson ------------------ Name: Greg Anderson Title: Authorized Agent Acknowledged and Accepted: FIRST CONSUMERS NATIONAL BANK, as Servicer and Seller By: /s/ John R. Steele ------------------ Name: John R. Steele Title: Treasurer First Consumers Credit Card Master Note Trust 73 Master Indenture Signature Page 74 ANNEX A to MASTER INDENTURE DEFINITIONS ----------- 75 TABLE OF CONTENTS
Page ---- ARTICLE I DEFINITIONS.................................................................. 2 Section 1.1. Definitions................................................. 2 Section 1.2. Other Definitional Provisions............................... 2 ARTICLE II THE NOTES.................................................................... 4 Section 2.1. Form Generally.............................................. 4 Section 2.2. Denominations............................................... 4 Section 2.3. Execution, Authentication and Delivery...................... 4 Section 2.4. Authenticating Agent........................................ 5 Section 2.5. Registration of and Limitations on Transfer and Exchange of Notes.................................................... 6 Section 2.6. Mutilated, Destroyed, Lost or Stolen Notes.................. 8 Section 2.7. Persons Deemed Owners....................................... 9 Section 2.8. Appointment of Paying Agent................................. 9 Section 2.9. Access to List of Noteholders' Names and Addresses.......... 10 Section 2.10. Cancellation................................................ 11 Section 2.11. [Reserved].................................................. 11 Section 2.12. New Issuances............................................... 11 Section 2.13. Book-Entry Notes............................................ 12 Section 2.14. Notices to Clearing Agency or Foreign Clearing Agency...................................................... 14 Section 2.15. Definitive Notes............................................ 14 Section 2.16. Global Note................................................. 14 Section 2.17. Meetings of Noteholders..................................... 15 ARTICLE III REPRESENTATIONS AND COVENANTS OF ISSUER...................................... 15 Section 3.1. Payment of Principal and Interest........................... 15 Section 3.2. Maintenance of Office or Agency............................. 16 Section 3.3. Money for Note Payments to Be Held in Trust................. 16 Section 3.4. Existence................................................... 17 Section 3.5. Protection of Collateral.................................... 17 Section 3.6. Opinions as to Collateral................................... 18 Section 3.7. Performance of Obligations; Servicing of Receivables........ 19 Section 3.8. Negative Covenants.......................................... 21 Section 3.9. Statements as to Compliance................................. 21 Section 3.10. Issuer May Consolidate, Etc., Only on Certain Terms......... 22
i Section 3.11. Successor Substituted...................................... 24 Section 3.12. No Other Business.......................................... 24 Section 3.13. [Reserved]................................................. 24 Section 3.14. Servicer's Obligations..................................... 24 Section 3.15. Investments................................................ 24 Section 3.16. Capital Expenditures....................................... 24 Section 3.17. Removal of Administrator................................... 24 Section 3.18. Restricted Payments........................................ 25 Section 3.19. Notice of Events of Default................................ 25 Section 3.20. Further Instruments and Acts............................... 25 ARTICLE IV SATISFACTION AND DISCHARGE.................................................. 25 Section 4.1. Satisfaction and Discharge of this Indenture............... 25 Section 4.2. Application of Issuer Money................................ 27 ARTICLE V PAY OUT EVENTS, DEFAULTS AND REMEDIES....................................... 27 Section 5.1. Pay Out Events............................................. 27 Section 5.2. Events of Default.......................................... 27 Section 5.3. Acceleration of Maturity; Rescission and Annulment......... 29 Section 5.4. Collection of Indebtedness and Suits for Enforcement by Indenture Trustee....................................... 30 Section 5.6. Optional Preservation of the Collateral.................... 34 Section 5.7. Limitation on Suits........................................ 34 Section 5.8. Unconditional Rights of Noteholders to Receive Principal and Interest............................. 35 Section 5.10. Rights and Remedies Cumulative............................. 35 Section 5.11. Delay or Omission Not Waiver............................... 35 Section 5.12. Rights of Noteholders to Direct Indenture Trustee.......... 36 Section 5.13. Waiver of Past Defaults.................................... 36 Section 5.14. Undertaking for Costs...................................... 37 Section 5.16. Sale of Receivables........................................ 37 Section 5.17. Action on Notes............................................ 38 ARTICLE VI THE INDENTURE TRUSTEE....................................................... 38 Section 6.1. Duties of the Indenture Trustee............................ 38 Section 6.2. Notice of Pay Out Event or Event of Default................ 40 Section 6.3. Rights of Indenture Trustee................................ 41 Section 6.4. Not Responsible for Recitals or Issuance of Notes.......... 42 Section 6.5. Restrictions on Holding Notes.............................. 42 Section 6.6. Money Held in Trust........................................ 42
ii Section 6.7. Compensation, Reimbursement and Indemnification.............. 42 Section 6.8. Replacement of Indenture Trustee............................. 43 Section 6.9. Successor Indenture Trustee by Merger........................ 45 Section 6.10. Appointment of Co-Indenture Trustee or Separate Indenture Trustee...................................................... 45 Section 6.11. Eligibility; Disqualification................................ 46 Section 6.12. Preferential Collection of Claims Against.................... 47 Section 6.13. Representations and Covenants of the Indenture Trustee....... 47 Section 6.14. Custody of the Collateral.................................... 47 ARTICLE VII NOTEHOLDERS' LIST AND REPORTS BY INDENTURE TRUSTEE AND ISSUER................. 48 Section 7.1. Issuer to Furnish Indenture Trustee Names and Addresses of Noteholders.................................................. 48 Section 7.2. Preservation of Information; Communications to Noteholders... 48 Section 7.3. Reports by Issuer............................................ 48 Section 7.4. Reports by Indenture Trustee................................. 49 ARTICLE VIII ALLOCATION AND APPLICATION OF COLLECTIONS..................................... 49 Section 8.1. Collection of Money.......................................... 50 Section 8.2. Rights of Noteholders........................................ 50 Section 8.3. Establishment of Collection Account and Excess Funding Account...................................................... 50 Section 8.4. Collections and Allocations.................................. 53 Section 8.5. Shared Principal Collections................................. 56 Section 8.6. Excess Finance Charge Collections............................ 56 Section 8.7. Allocation of Collateral to Series or Groups................. 56 Section 8.8. Release of Collateral; Eligible Loan Documents............... 57 Section 8.9. Opinion of Counsel........................................... 58 ARTICLE IX DISTRIBUTIONS AND REPORTS TO NOTEHOLDERS...................................... 58 ARTICLE X SUPPLEMENTAL INDENTURES....................................................... 59 Section 10.1. Supplemental Indentures Without Consent of Noteholders....... 59 Section 10.2. Supplemental Indentures with Consent of Noteholders.......... 61 Section 10.3. Execution of Supplemental Indentures......................... 62 Section 10.4. Effect of Supplemental Indenture............................. 63
iii Section 10.5. Conformity With Trust Indenture Act.......................... 63 Section 10.6. Reference in Notes to Supplemental Indentures................ 63 ARTICLE XI TERMINATION................................................................... 63 Section 11.1. Termination of Issuer........................................ 63 Section 11.2. Final Distribution........................................... 63 Section 11.3. Issuer's Termination Rights.................................. 64 ARTICLE XII MISCELLANEOUS................................................................. 65 Section 12.1. Compliance Certificates and Opinions etc..................... 65 Section 12.2. Form of Documents Delivered to Indenture Trustee............. 66 Section 12.3. Acts of Noteholders.......................................... 67 Section 12.4. Notices, Etc. to Indenture Trustee and Issuer................ 67 Section 12.5. Notices to Noteholders; Waiver............................... 68 Section 12.6. Alternate Payment and Notice Provisions...................... 68 Section 12.7. Conflict with Trust Indenture Act............................ 69 Section 12.8. Effect of Headings and Table of Contents..................... 69 Section 12.9. Successors and Assigns....................................... 69 Section 12.10. Separability................................................. 69 Section 12.11. Benefits of Indenture........................................ 69 Section 12.12. Legal Holidays............................................... 69 Section 12.13. Governing Law................................................ 69 Section 12.14. Counterparts................................................. 70 Section 12.15. Issuer Obligation............................................ 70 Section 12.16. No Petition.................................................. 70
iv ANNEX A TO MASTER INDENTURE DEFINITIONS "Account" means each MasterCard(R) or VISA(R)*/ credit card account ------- established pursuant to a Cardholder Agreement, and which is designated as an "Account" pursuant to (and as defined in) the Pooling and Servicing Agreement on or prior to the FCMT Termination Date. The term "Account" shall also be deemed to refer to an Additional Account, but only from and after the Addition Date with respect thereto, and the term "Account" shall be deemed to refer to any Removed Account prior to but not after the Removal Date with respect thereto. "Acquiring Person" is defined in Section 3.10(b) of the Indenture. ---------------- --------------- "Act" is defined in Section 12.3(a) of the Indenture. --- --------------- "Addition Date" means, with respect to any Additional Accounts, either ------------- the date five Business Days after the period or date when such Additional Accounts are required or permitted to be added as Accounts pursuant to Section 2.6(a) or (b) of the Transfer and Servicing Agreement, or the date -------------- --- on which such Additional Accounts are automatically added as Accounts pursuant to Section 2.6(e) of the Transfer and Servicing Agreement. -------------- "Additional Accounts" means the Accounts the receivables arising under ------------------- which are transferred to the Issuer in accordance with the procedures set forth in Section 2.6 of the Transfer and Servicing Agreement. ----------- "Adjusted Collateral Amount" is defined, with respect to any Series (if -------------------------- applicable to that Series), in the related Indenture Supplement, or if no meaning for such term is specified in such Supplement, shall mean the Collateral Amount for such Series. "Administration Agreement" means the Administration Agreement, dated as ------------------------ of March 1, 2001 between the Issuer and the Administrator, as the same may be amended, supplemented or otherwise modified from time to time. "Administrator" means FCNB, its capacity as administrator, under the ------------- Administration Agreement, and any successor in that capacity. _____________________ */ MasterCard is a registered trademark of MasterCard International Incorporated and VISA is a registered trademark of VISA U.S.A., Inc. "Adverse Effect" means, with respect to any action, that such action -------------- will (a) result in the occurrence of a Pay Out Event or an Event of Default or (b) materially and adversely affect the amount or timing of distributions to be made to the Noteholders of any Series or Class pursuant to the Transaction Documents. "Affiliate" means, with respect to any specified Person, any other --------- Person controlling or controlled by or under common control with such specified Person. For the purposes of this definition, "control" means the power to direct the management and policies of a Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing. "Aggregate Allocation Percentage" with respect to Principal Receivables, ------------------------------- Finance Charge Receivables and Receivables in Defaulted Accounts, as the case may be, means, as of any date of determination, the sum of such Allocation Percentages of all Series issued and outstanding on such date of determination; provided, however, that the Aggregate Allocation Percentage -------- ------- shall not exceed 100%. "Aggregate Collateral Amount" means, as of any date of determination, --------------------------- the sum of the Adjusted Collateral Amounts of all Series issued and outstanding on such date of determination. "Aggregate Principal Balance" means, as of any time of determination, --------------------------- the sum of (a) the Aggregate Principal Receivables, (b) the Excess Funding Amount (exclusive of any investment earnings on such amount) and (c) the amount on deposit in the Principal Collection Subaccount (exclusive of any investment earnings on such amount), in each case as of such time. "Aggregate Principal Receivables" means, as of any date of ------------------------------- determination, the aggregate amount of Principal Receivables (excluding any Discount Option Receivables) as of the end of the prior day. "Allocation Percentage" is defined, for any Series, with respect to --------------------- Principal Receivables, Finance Charge Receivables and Receivables in Defaulted Accounts, in the related Indenture Supplement. "Annual Account Additions" means on any date of determination, the ------------------------ number of Accounts the Receivables of which have been added to the Receivables Trust pursuant to Sections 2.6(a), (b) and (e) of the Transfer --------------- --- --- and Servicing Agreement or the corresponding sections of the Pooling and Servicing Agreement, from and including the first day of the eleventh Monthly Period preceding such date of determination. -2- "Annual Quotient" is defined in Section 2.6(c)(ii)(1) of the Transfer --------------- --------------------- and Servicing Agreement. "Applicants" is defined in Section 2.9 of the Indenture. ---------- ----------- "Assignment Agreement" is defined in Section 2.6(b)(iii) of the Transfer -------------------- ------------------- and Servicing Agreement. "Authorized Newspapers" means each newspaper of general circulation in --------------------- New York, New York, or in any other place specified by Seller, printed in the English language and customarily published on each Business Day, whether or not published on Saturdays, Sundays or holidays. "Authorized Officer" means: ------------------ (a) with respect to the Issuer, any officer of the Owner Trustee who is authorized to act for the Owner Trustee in matters relating to the Issuer and who is identified on the list of Authorized Officers, containing the specimen signature of each such Person, delivered by the Owner Trustee to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter) and any Vice President or more senior officer of the Administrator who is authorized to act for the Administrator in matters relating to the Issuer and to be acted upon by the Administrator pursuant to the Administration Agreement and who is identified on the list of Authorized Officers (containing the specimen signatures of such officers) delivered by the Administrator to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter); (b) with respect to the Seller, any officer of the Seller who is authorized to act for the Seller in matters relating to the Seller and who is identified on the list of Authorized Officers, containing the specimen signature of each such Person, delivered by the Seller to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter); and (c) with respect to the Servicer, any officer of the Servicer who is authorized to act for the Servicer in matters relating to the Servicer and who is identified on the list of Authorized Officers, containing the specimen signature of each such Person, delivered by the Servicer to the Indenture Trustee on the Closing Date (as such list may be modified or supplemented from time to time thereafter). -3- "Base Amount" means, at any date of determination, with reference to ----------- Annual Account Additions or Quarterly Account Additions, the number of Accounts included in the Receivables Trust on the first day of the relevant measurement period before giving effect to any Accounts added to the Receivables Trust on such first day. "Base Rate" is defined, with respect to any Series, in the related --------- Indenture Supplement. "Bearer Note" is defined in Section 2.1 of the Indenture. ----------- ----------- "Book-Entry Notes" means beneficial interests in the Notes, ownership ---------------- and transfers of which shall be made through book entries by a Clearing Agency or Foreign Clearing Agency as described in Section 2.13 of the ------------ Indenture. "Business Day" means each day which is neither a Saturday, a Sunday nor ------------ any other day on which banking institutions in New York, New York, Portland, Oregon or Chicago, Illinois (or, with respect to any Series, any additional city specified in the related Indenture Supplement) are authorized or obligated by law or required by executive order to be closed. "Cardholder Agreement" means the agreement (and the related application) -------------------- for a MasterCard or VISA credit card account between any Obligor and FCNB, as the same may be amended, modified or otherwise changed from time to time, or in the case of any Additional Account not originated by FCNB, the agreement (and the related application) for a MasterCard or VISA credit card account between the related Obligor and the originator of such Account, as the same may be amended, modified or otherwise changed from time to time. "Cardholder Fees" means, with respect to any Account, any fees specified --------------- in the Cardholder Agreement applicable to such Account, including annual fees, over limit charges, cash advance fees, late charges, returned check fees, and reinstatement charges. "Cardholder Guidelines" means FCNB's policies and procedures relating to --------------------- the operation of its credit card business, including the FCNB Credit Policy and Operations Manual or such other of its policies and procedures for determining the creditworthiness of credit card customers, the extension of credit to customers, the terms on which repayments are required to be made, and relating to the maintenance of credit card accounts and collection of credit card account receivables, as said manual and such policies and procedures, as applicable, may be amended from time to time. -4- "Cash Advance Fees" means, with respect to any Account, any fees ----------------- specified in the Cardholder Agreement applicable to such Account as cash advance fees or any similar term. "Class" means, with respect to any Series, any one of the classes of ----- Notes of that Series. "Clearing Agency" means an organization registered as a "clearing --------------- agency" pursuant to Section 17A of the Securities Exchange Act of 1934. "Clearing Agency Participant" means a broker, dealer, bank, other --------------------------- financial institution or other Person for whom from time to time a Clearing Agency effects book-entry transfers and pledges of securities deposited with the Clearing Agency. "Clearstream" means Clearstream Banking, societe anonyme, a professional ----------- depository incorporated under the laws of Luxembourg, and its successors. "Closing Date" means, with respect to any Series, the closing date ------------ specified in the related Indenture Supplement. "Code" means the Internal Revenue Code of 1986, as amended. ---- "Collateral" is defined in the Granting Clause of the Indenture. ---------- "Collateral Amount" is defined, with respect to any Series, in the ----------------- related Indenture Supplement. "Collateral Certificate" means the certificate, representing an ---------------------- undivided interest in the assets held in the First Consumers Master Trust, issued pursuant to the Pooling and Servicing Agreement and the Collateral Series Supplement, dated as of March 1, 2001, to the Pooling and Servicing Agreement. "Collection Account" is defined in Section 8.3(a) of the Indenture. ------------------ -------------- "Collections" means all payments (including Insurance Proceeds and ----------- Recoveries) received by the Servicer or by Seller in respect of the Collateral Certificate and the Receivables, in the form of cash, checks, wire transfers, ATM transfers, net proceeds of redemption of certificates of deposit or liquidation of bank accounts or other form of payment in accordance with the Cardholder Agreement in effect from time to time on any Receivable. A Collection processed in respect of an Account (other than a Defaulted Account) in excess of the aggregate amount of Receivables in such Account as of the Date of Processing of such Collection shall be deemed to be a payment in respect of Principal Receivables to the extent of such -5- excess. Collections with respect to any Monthly Period shall also include the amount of Interchange (if any) allocable to any Series of Notes pursuant to any Indenture Supplement with respect to such Monthly Period (to the extent received by the Issuer and deposited into the Collection Account, on the Transfer Date following such Monthly Period), to be applied as if such Collections were Finance Charge Receivables for all purposes. "Commission" means the Securities and Exchange Commission. ---------- "Corporate Trust Office" means ---------------------- (a) for the Indenture Trustee, the principal office at which at any particular time its corporate trust business shall be administered, which office at date of the execution of the Indenture is located at 2 North LaSalle Street, Suite 1020, Chicago, Illinois 60602, Attention: Structured Finance Services, or at such other address as the Indenture Trustee may designate from time to time by notice to the Noteholders and the Seller, or the principal corporate trust office of any successor Indenture Trustee (the address of which the successor Indenture Trustee will notify the Noteholders and the Seller); (b) for the Owner Trustee, the principal office at which at any particular time its corporate trust business shall be administered, which office at date of the execution of the Indenture is located at Four Albany Street, 10/th/ Floor, New York, New York 10006, Attn: Corporate Trust and Agency Services. "Coupon" is defined in Section 2.1 of the Indenture. ------ ----------- "Credit Adjustment" is defined in Section 8.4(e) of the Indenture. ----------------- -------------- "Credit Insurance" means life, accident, health, disability, involuntary ---------------- unemployment or other insurance of an Obligor to Seller to insure payment of any amount owing by such Obligor under an Account and which proceeds of such insurance are payable to Seller upon such Obligor's death, disability or involuntary unemployment. "Date of Processing" means, with respect to any transaction, the date on ------------------ which such transaction is first recorded on the Servicer's computer master file of accounts (without regard to the effective date of such recordation). "Debtor Relief Laws" means the Bankruptcy Code of the United States of ------------------ America and all other applicable liquidation, conservatorship, bankruptcy, fraudulent conveyance, moratorium, rearrangement, receivership, insolvency, reorganization, -6- suspension of payments, or similar debtor relief laws from time to time in effect affecting the rights of creditors (including creditors of national banking associations) generally. "Default" means any occurrence that is, or with notice or the lapse of ------- time or both would become, an Event of Default. "Default Amount" means, with respect to any Monthly Period, the result -------------- of multiplying (i) the excess, if any, of (A) the aggregate amount of Receivables in Defaulted Accounts charged off during such Monthly Period over (B) Recoveries collected during such Monthly Period, times (ii) 1.00 minus the percentage (expressed as a decimal) of Receivables (other than Receivables in Defaulted Accounts) constituting Finance Charge Receivables determined in accordance with Section 1.3 of the Transfer and Servicing Agreement or Section 1.3 of the Pooling and Servicing Agreement. "Defaulted Account" means each Account with respect to which, in ----------------- accordance with the Cardholder Guidelines or the Servicer's customary and usual servicing procedures for servicing credit card receivables comparable to the Receivables, the Servicer has charged off the Receivables in such Account as uncollectible; an Account shall become a Defaulted Account on the day on which such Receivables are recorded as charged off on the Servicer's computer master file of accounts (regardless of whether such Receivables are charged off before or after the Initial FCMT Cut-Off Date or Addition Date of such Account, as the case may be). "Definitive Notes" means Notes in definitive, fully registered form. ---------------- "Demand Note" is defined in Section 2.9 of the Transfer and Servicing ----------- ----------- Agreement. "Deposit Date" means each day on which the Servicer deposits Collections ------------ in the Collection Account. "Deposit Obligation" means the obligation of the Seller to make any ------------------ deposit to the Excess Funding Account or the Collection Account pursuant to Section 2.4(d) of the Transfer and Servicing Agreement or Section 8.4(g) of --------- -------------- the Indenture. "Determination Date" means the seventh calendar day prior to each ------------------ Transfer Date. -7- "Discount Option Date" means each date on which a Discount Percentage -------------------- designated by the Seller pursuant to Section 2.8 of the Transfer and ----------- Servicing Agreement takes effect. "Discount Option Receivable Collections" means on any Date of Processing -------------------------------------- occurring in any Monthly Period succeeding the Monthly Period in which the Discount Option Date occurs, the product of (a) a fraction (i) the numerator of which is the Discount Option Receivables and (ii) the denominator of which is the sum of the Principal Receivables and the Discount Option Receivables in each case (for both the numerator and the denominator) at the end of the prior Date of Processing and (b) Collections of Original Principal Receivables on such Date of Processing. "Discount Option Receivables" is defined in Section 2.8 of the Transfer --------------------------- ----------- and Servicing Agreement. The aggregate amount of Discount Option Receivables outstanding on any Date of Processing occurring on or after the Discount Option Date shall equal the result of (a) the aggregate Discount Option Receivables at the end of the prior Date of Processing (which amount, prior to the Discount Option Date, shall be zero) plus (b) any new Discount Option Receivables created on such Date of Processing minus (c) any Discount Option Receivables Collections received on such Date of Processing. Discount Option Receivables created on any Date of Processing mean the product of the amount of any Original Principal Receivables created on such Date of Processing and the Discount Percentage. "Discount Percentage" is defined in Section 2.8 of the Transfer and ------------------- ----------- Servicing Agreement. "Distribution Date" means, unless otherwise specified in the Indenture ----------------- Supplement for a Series, the fifteenth day of each month or, if such fifteenth day is not a Business Day, the next succeeding Business Day. "Dollars," "$" or "U.S. $" means United States dollars. ------- - ------ "DTC" means The Depository Trust Company. --- "Eligible Account" means, (a) with respect to "Accounts" designated ---------------- pursuant to (and as defined in) the Pooling and Servicing Agreement prior to the FCMT Termination Date, Accounts which are "Eligible Accounts" under (and as defined in) the Pooling and Servicing Agreement and (b) as of the relevant Notice Date in respect of Additional Accounts added pursuant to Section 2.6 (a) or (b) of the Transfer and Servicing Agreement or the fifth --------------- --- Business Day prior to the relevant Addition Date in respect of Additional Accounts added pursuant to Section 2.6(e) of the Transfer and Servicing -------------- Agreement), each Account: -8- (a) which is payable in United States dollars; (b) which is serviced in any credit service center of Seller which is located in the United States; (c) the Obligor on which has provided, as its initial billing address, an address which is located in the United States or its territories or possessions; (d) which the Seller has not finally determined to be counterfeit or fraudulent; (e) which the Seller has not charged off in its customary and usual manner for charging off such Accounts as of the relevant Notice Date or Addition Date; (f) which was originated by FCNB in the ordinary course of business, unless the Rating Agency Condition has otherwise been satisfied with respect to such Account; (g) which has not been sold or pledged to any other party; (h) which does not have receivables which have been sold or pledged to any party; and (i) is a "VISA" or "MasterCard" revolving credit card account. "Eligible Institution" means any depository institution (which may be -------------------- the Owner Trustee or the Indenture Trustee) organized under the laws of the United States or any one of the states thereof, including the District of Columbia (or any domestic branch of a foreign bank), which depository institution at all times (a) has FDIC deposit insurance and (b) has (i) a long-term unsecured debt rating acceptable to the Rating Agencies, which in the case of Standard and Poor's shall be a rating of AAA or (ii) a certificate of deposit rating acceptable to the Rating Agencies, which in the case of Standard and Poor's shall be a rating of A-1+. Notwithstanding the previous sentence, any institution the appointment of which satisfies the Rating Agency Condition shall be considered an Eligible Institution. If so qualified, the Servicer may be considered an Eligible Institution for the purposes of this definition. "Eligible Receivable" means each Receivable: ------------------- (a) which has arisen under an Eligible Account; -9- (b) which was created in compliance, in all material respects, with all Requirements of Law applicable to FCNB or the originator of the related Account pursuant to a Cardholder Agreement which complies, in all material respects, with all Requirements of Law applicable to FCNB or the originator of the related Account; (c) with respect to which all consents, licenses, approvals or authorizations of, or registrations or declarations with, any Governmental Authority required to be obtained, effected or given by FCNB or the originator of the related Account in connection with the creation of such Receivable or the execution, delivery and performance by FCNB or the originator of the related Account, as applicable, of the Cardholder Agreement pursuant to which such Receivable was created, have been duly obtained, effected or given and are in full force and effect as of such date of creation; (d) as to which, immediately prior to the transfer of same to the Receivables Trust by FCNB, FCNB had good title thereto free and clear of all Liens arising under or through FCNB or its Affiliates (other than Liens permitted pursuant to Section 2.5(b) of the Transfer and Servicing -------------- Agreement); (e) which is the legal, valid and binding payment obligation of the Obligor thereon, enforceable against such Obligor in accordance with its terms, except as such enforceability may be limited by applicable Debtor Relief Laws, and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity); (f) which constitutes an "account" or a "general intangible" under and as defined in Article 9 of the UCC as then in effect in the State of Illinois; (g) which, at the time of transfer to the Receivables Trust, has not been waived or modified except for a Receivable which has been waived or modified as permitted in accordance with the Cardholder Guidelines and which waiver or modification is reflected in FCNB's computer files of revolving credit card accounts; (h) which, at the time of transfer to the Receivables Trust, is not (to the knowledge of Seller) subject to any right of rescission, set-off, counterclaim or any other defense (including defenses arising out of violations or usury laws) of the Obligor, which requires that such Receivable be charged off in accordance with the Cardholder Guidelines, other than defenses arising out of applicable bankruptcy, insolvency, reorganization, -10- moratorium or other similar laws affecting the enforcement of creditors' rights in general; (i) as to which, at the time of transfer to the Receivables Trust, FCNB has satisfied all its obligations required to be satisfied by such time; (j) which has been the subject of either a valid transfer and assignment from the Seller to the Issuer of the Seller's right, title and interest therein (including any proceeds thereof), or the grant by the Seller to the Issuer of a valid first priority perfected security interest therein (and the proceeds thereof); and (k) as to which at the time of transfer to the Issuer, the Seller has not taken any action, or omitted to take any action, that would impair the rights of the Issuer or the Noteholders. "Eligible Servicer" means the Indenture Trustee or, if the Indenture ----------------- Trustee is not acting as Servicer, an entity which, at the time of its appointment as Servicer, (a) is servicing a portfolio of revolving credit card accounts, (b) is legally qualified and has the capacity to service the Accounts, (c) has demonstrated the ability to service professionally and competently a portfolio of similar accounts in accordance with high standards of skill and care, (d) is qualified to use the software that is then being used to service the Accounts or obtains the right to use or has its own software which is adequate to perform its duties under this Agreement and (e) has a net worth of at least $50,000,000 as of the end of its most recent fiscal quarter. "Enhancement" means, with respect to any Series, the cash collateral ----------- account, letter of credit, surety bond, guaranteed rate agreement, maturity guaranty facility, tax protection agreement, interest rate swap or any other contract, arrangement or agreement for the benefit of the Noteholders of such Series (or Noteholders of a Class within such Series), as designated in the applicable Indenture Supplement. "Enhancement Agreement" means any agreement, instrument or document --------------------- governing the terms of any Series Enhancement or pursuant to which any Series Enhancement is issued or outstanding. "Enhancement Provider" means, with respect to any Series, the Person, if -------------------- any, designated as such in the related Indenture Supplement. "Euroclear Operator" means Euroclear Bank S.A./N.V. ------------------ "Event of Default" is defined in Section 5.2 of the Indenture. ---------------- ----------- -11- "Excess Allocation Series" means a Series that, pursuant to the ------------------------ Indenture Supplement therefor, is entitled to receive certain excess Collections of Finance Charge Receivables, as more specifically set forth in such Indenture Supplement. If so specified in the Indenture Supplement for a Group of Series, such Series may be Excess Allocation Series only for the Series in such Group. "Excess Finance Charge Collections" is defined in Section 8.6 of the --------------------------------- ----------- Indenture. "Excess Funding Account" is defined in Section 8.3 of the Indenture. ---------------------- ----------- "Excess Funding Amount" means the amount on deposit in the Excess --------------------- Funding Account. "Exchange Act" means the Securities Exchange Act of 1934. ------------ "Expenses" is defined in Section 7.2 of the Trust Agreement. -------- ----------- "FCMT Termination Date" means the date on which the First Consumers --------------------- Master Trust is terminated and all of the Receivables held by First Consumers Master Trust are transferred to the Issuer. "FCMT Trustee" means the trustee under the Pooling and Servicing ------------ Agreement. "FCNB" means First Consumers National Bank, a national banking ---- association. "FDIC" means the Federal Deposit Insurance Corporation. ---- "Finance Charge Collections" means, for any period, the amount of -------------------------- Collections allocated to Finance Charge Receivables during such period in accordance with Section 1.3 of the Transfer and Servicing Agreement plus ----------- Discount Option Receivables Collections for such period. Payments on account of Net Recoveries shall also be treated as Finance Charge Collections. "Finance Charge Receivables" means, with respect to any Monthly -------------------------- Period, (a) all amounts billed to Obligors on any Account during such Monthly Period in respect of Finance Charges, Cash Advance Fees and Cardholder Fees, and (b) the amount of Interchange (if any) allocable to any Series of Notes pursuant to any Indenture Supplement with respect to such Monthly Period. "Finance Charge Shortfalls" is defined in Section 8.6 of the ------------------------- ----------- Indenture. -12- "Finance Charge Subaccount" means the finance charge subaccount of the ------------------------- Collections Account. "Finance Charges" means, as of any day, the amount of interest as --------------- determined by the periodic finance charge rate assessed on the Cycle Billing Date on or next preceding such day pursuant to the Cardholder Agreements. "First Consumers Master Trust" means the trust formed by the Pooling ---------------------------- and Servicing Agreement. "Fitch" means Fitch, Inc. ----- "Foreign Clearing Agency" means Clearstream and the Euroclear ----------------------- Operator. "GAAP" means generally accepted accounting principles in the United ---- States of America in effect from time to time. "Global Note" is defined in Section 2.16 of the Indenture. ----------- ------------ "Governmental Authority" means the United States of America, any state ---------------------- or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government. "Grant" means to mortgage, pledge, bargain, warrant, alienate, remise, ----- release, convey, assign, transfer, create, and grant a lien upon and a security interest in and right of set-off against, deposit, set over and confirm pursuant to this Indenture. A Grant of the Collateral or of any other agreement or instrument shall include all rights, powers and options (but none of the obligations) of the Granting party thereunder, including if available the immediate and continuing right to claim for, collect, receive and give receipt for principal and interest payments in respect of the Collateral and all other moneys payable thereunder, to give and receive notices and other communications, to make waivers or other agreements, to exercise all rights and options, to bring Proceedings in the name of the Granting party or otherwise and generally to do and receive anything that the Granting party is or may be entitled to do or receive thereunder or with respect thereto. "Group" means, with respect to any Series, the group of Series, if ----- any, in which the related Indenture Supplement specifies such Series is to be included. "Indemnified Parties" is defined in Section 7.2 of the Trust ------------------- ----------- Agreement. -13- "Indenture" means the Master Indenture, dated as of March 1, 2001, --------- between the Issuer and the Indenture Trustee, as the same may be amended, supplemented or otherwise modified from time to time. "Indenture Supplement" means, with respect to any Series, a supplement -------------------- to this Indenture, executed and delivered in connection with the original issuance of the Notes of such Series pursuant to Section 2.12 of the ------------ Indenture, and an amendment to this Indenture executed pursuant to Sections -------- 10.1 or 10.2 of the Indenture, and, in either case, including all ---- ---- amendments thereof and supplements thereto. "Indenture Trustee" means The Bank of New York, in its capacity as ----------------- trustee under this Indenture, its successors in interest and any successor indenture trustee under this Indenture. "Independent" means, when used with respect to any specified Person, ----------- that the Person (a) is in fact independent of the Issuer, any other obligor upon the Notes, the Seller and any Affiliate of any of the foregoing Persons, (b) does not have any direct financial interest or any material indirect financial interest in the Issuer, any such other obligor, the Seller or any Affiliate of any of the foregoing Persons and (c) is not connected with the Issuer, any such other obligor, the Seller or any Affiliate of any of the foregoing Persons as an officer, employee, promoter, underwriter, trustee, partner, director or person performing similar functions. "Independent Certificate" means a certificate or opinion to be ----------------------- delivered to the Indenture Trustee under the circumstances described in, and otherwise complying with, the applicable requirements of Section 12.1 ------------ of the Indenture, made by an Independent appraiser or other expert appointed by an Issuer Order, and such opinion or certificate shall state that the signer has read the definition of "Independent" in this Indenture and that the signer is Independent within the meaning thereof. "Indirect Participant" means other Persons such as securities brokers -------------------- and dealers, banks and trust companies that clear or maintain a custodial relationship with a participant of DTC, either directly or indirectly. "Ineligible Receivables" is defined in Section 2.4(d) of the Transfer ---------------------- -------------- and Servicing Agreement. "Initial Closing Date" means March 6, 2001. -------------------- "Initial Collateral Amount" with respect to any Series, shall have the ------------------------- meaning specified in the related Indenture Supplement. "Initial FCMT Cut-Off Date" means September 22, 1992. ------------------------- -14- "Insolvency Event" is defined in Section 6.1 of the Transfer and ---------------- ----------- Servicing Agreement. "Insurance Proceeds" means any amounts received pursuant to the ------------------ payment of benefits under any credit life insurance policies, credit disability or unemployment insurance policies covering any Obligor with respect to Receivables under such Obligor's Account. "Interchange" means interchange fees paid or payable to the Seller, in ----------- its capacity as credit card issuer, through MasterCard International Incorporated and/or VISA USA, Inc. in connection with cardholder charges for goods and services. "Investment Company Act" means the Investment Company Act of 1940. ---------------------- "Investor Monthly Servicing Fee" is defined in Section 3.2 of the ------------------------------ ----------- Transfer and Servicing Agreement. "Issuer" means the First Consumers Credit Card Master Note Trust, ------ which is established by the Trust Agreement. "Issuer Order" and "Issuer Request" means a written order or request ------------ -------------- signed in the name of the Issuer by any one of its Authorized Officers and delivered to the Indenture Trustee. "Lien" means any mortgage, deed of trust, pledge, hypothecation, ---- assignment, deposit arrangement, encumbrance, lien (statutory or other), equity interest, participation interest, preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever including any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing and the filing of any financing statement under the UCC (other than any such financing statement filed for informational purposes only) or comparable law of any jurisdiction to evidence any of the foregoing; provided, however, that any assignment -------- ------- pursuant to the Indenture shall not be deemed to constitute a Lien. "Minimum Aggregate Principal Balance" means, on any date of ----------------------------------- determination, the greater of (a) the sum of the Aggregate Collateral Amount, plus the Minimum Seller Amount, in each case as of such date and (b) the sum of the numerators used to determine the Allocation Percentages for Principal Collections of all Series outstanding on such date. -15- "Minimum Average Seller Percentage" means the weighted average (by --------------------------------- Adjusted Collateral Amount) Minimum Seller Percentages for all Series then outstanding. "Minimum Seller Amount" means, on any Determination Date, the --------------------- Aggregate Collateral Amount at the end of the day prior to such Determination Date, times the Minimum Average Seller Percentage; provided -------- that if such percentage is zero, the Minimum Seller Amount shall be zero. ---- FCNB may reduce the Minimum Seller Amount by written notice to the Indenture Trustee, provided that (a) the Rating Agency Condition is satisfied with respect to such reduction and (b) FCNB delivers to the Indenture Trustee an Opinion of Counsel to the effect that such reduction will not have a material adverse effect on the Federal income tax characterization of any outstanding Series. "Minimum Seller Percentage" is defined, for any Series, in the related ------------------------- Indenture Supplement. "Monthly Period" means the period from and including the first day of -------------- the calendar month preceding a related Determination Date to and including the last day of such calendar month. "Monthly Seller Servicing Fee" is defined in Section 3.2 of the ---------------------------- ----------- Transfer and Servicing Agreement. "Monthly Servicing Fee" is defined in Section 3.2 of the Transfer and --------------------- ----------- Servicing Agreement. "Moody's" means Moody's Investors Service, Inc. ------- "Net Recoveries" means, with respect to any Monthly Period, the -------------- excess, if any, of Recoveries collected during such Monthly Period over the aggregate amount of Principal Receivables in Defaulted Accounts charged off during such Monthly Period. "New Issuance" is defined in Section 2.12(a) of the Indenture. ------------ --------------- "Note Interest Rate" means, as of any particular date of determination ------------------ and with respect to any Series or Class, the interest rate as of such date specified therefor in the related Indenture Supplement. "Note Owner" means, with respect to a Book-Entry Note, the Person who ---------- is the owner of such Book-Entry Note, as reflected on the books of the Clearing Agency, or on the books of a Person maintaining an account with such Clearing -16- Agency (directly as a Clearing Agency Participant or as an Indirect Participant, in accordance with the rules of such Clearing Agency). "Note Principal Balance" means, as of any particular date of ---------------------- determination and with respect to any Series or Class, the amount specified in the related Indenture Supplement. "Note Register" is defined in Section 2.5 of the Indenture. ------------- ----------- "Noteholder" or "Holder" means the Person in whose name a Note is ---------- ------ registered on the Note Register and, if applicable, the holder of any Global Note, or Coupon, as the case may be, or such other Person deemed to be a "Noteholder" or "Holder" in any related Indenture Supplement. "Notes" means all Series of Notes issued by the Issuer pursuant to ----- this Indenture and the applicable Indenture Supplements. "Notice Date" is defined in Section 2.6(c) of the Transfer and ----------- -------------- Servicing Agreement. "Notices" is defined in Section 9.4(a) of the Transfer and Servicing ------- -------------- Agreement. "Obligor" means, with respect to any Account, the Person or Persons ------- obligated to make payments with respect to such Account, including any guarantor thereof. "Officer's Certificate" means a certificate signed by any officer of --------------------- Seller or the Servicer and delivered to the Indenture Trustee. "Opinion of Counsel" means a written opinion of counsel, who may be ------------------ counsel for Seller or the Servicer and who shall be reasonably acceptable to the Indenture Trustee, provided that a Tax Opinion shall be an opinion -------- of Rooks, Pitts and Poust or other nationally recognized tax counsel. "Original Principal Receivables" means Principal Receivables ------------------------------ determined without giving effect to any reduction thereof attributable to Discount Option Receivables. "Outstanding" means, as of the date of determination, all Notes ----------- theretofore authenticated and delivered under this Indenture except: -17- (i) Notes theretofore canceled by the Note Registrar or delivered to the Note Registrar for cancellation; (ii) Notes or portions thereof the payment for which money in the necessary amount has been theretofore deposited with the Indenture Trustee or any Paying Agent in trust for the Holders of such Notes (provided, however, that if such Notes are to be redeemed, notice of -------- ------- such redemption has been duly given pursuant to this Indenture or provision therefor, satisfactory to the Indenture Trustee, has been made); and (iii) Notes in exchange for or in lieu of other Notes which have been authenticated and delivered pursuant to this Indenture unless proof satisfactory to the Indenture Trustee is presented that any such Notes are held by a protected purchaser; provided that in determining whether the Holders of Notes representing the -------- requisite Outstanding Notes have given any request, demand, authorization, direction, notice, consent or waiver hereunder, Notes owned by the Issuer, any other obligor upon the Notes, the Seller, the Servicer or any Affiliate of any of the foregoing Persons shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Indenture Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Notes that a Trustee Officer of the Indenture Trustee actually knows to be so owned shall be so disregarded. Notes so owned that have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Indenture Trustee the pledgee's right so to act with respect to such Notes and that the pledgee is not the Issuer, any other obligor upon the Notes, the Seller, the Servicer or any Affiliate of any of the foregoing Persons. In making any such determination, the Indenture Trustee may conclusively rely on the representations of the pledgee and shall not be required to undertake any independent investigation. "Outstanding Amount" means the aggregate principal amount of all Notes ------------------ Outstanding at the date of determination. "Owner Trustee" means Bankers Trust Company, in its capacity as owner ------------- trustee under the Trust Agreement, its successors in interest and any successor owner trustee under the Trust Agreement. "Paired Series" means (i) each Series which has been paired with ------------- another Series (which Series may be prefunded or partially prefunded), such that the reduction of the Collateral Amount or Adjusted Collateral Amount of such Series results in the increase of the Collateral Amount of such other Series, as described in the related Indenture Supplements, and (ii) such other Series. -18- "Pay Out Event" means, with respect to any Series, a Series Pay Out ------------- Event relating to that Series or a Trust Pay Out Event. "Paying Agent" means any paying agent appointed pursuant to Section ------------ ------- 2.8 of the Indenture and shall initially be the Indenture Trustee; provided --- -------- that if the Indenture Supplement for a Series so provides, a separate or additional Paying Agent may be appointed with respect to such Series. "Permitted Assignee" means any Person who, if it were to purchase ------------------ Receivables (or interests therein) in connection with a sale thereof pursuant to Sections 5.5(a) and 5.16 of the Indenture, would not cause the --------------- ---- Issuer to be taxable as a publicly traded partnership for federal income tax purposes. "Permitted Investments" means (a) negotiable instruments or securities --------------------- represented by instruments in bearer or registered form which evidence (i) obligations of or guaranteed by the United States of America, (ii) time deposits in, certificates of deposit of, or bankers' acceptances issued by, any depositary institution or trust company (other than Seller or an Affiliate of Seller) incorporated under the laws of the United States of America or any state thereof and subject to supervision and examination by federal or state banking or depositary institution authorities, provided, -------- however, that at the time of the Trust's investment or contractual ------- commitment to invest therein, the certificates of deposit or short-term deposits, if any, or long-term unsecured debt obligations (other than such obligation whose rating is based on collateral or on the credit of a Person other than such institution or trust company) of such depositary institution or trust company shall have a credit rating from Moody's and Standard & Poor's of P-1 and A-1+, respectively, in the case of the certificates of deposit or short-term deposits, or a rating from Moody's of Aaa and from Standard & Poor's of AAA in the case of the long-term unsecured debt obligations, or such time deposits are fully insured by the FDIC, (iii) certificates of deposit (other than those of Seller or an Affiliate of Seller) having, at the time of the Trust's investment or contractual commitment to invest therein, a rating from Moody's and Standard & Poor's of P-1 and A-1+, respectively, and (iv) investments in money market funds rated in the highest investment category or otherwise approved in writing by Moody's and Standard & Poor's, which in the case of Standard & Poor's is AAAmg; (b) demand deposits in the name of the Issuer or the Indenture Trustee in any depositary institution or trust company referred to in (a) (ii) above; and (c) securities not represented by an instrument, which are registered in the name of the Indenture Trustee upon books maintained for that purpose by or on behalf of the issuer thereof and identified on books maintained for that purpose by the Indenture Trustee as held for the benefit of the Issuer or the Noteholders, and consisting of shares of an open end diversified investment company which is registered under the Investment Company Act of 1940, as amended, and which (i) -19- invests its assets exclusively in obligations of or guaranteed by the United States of America or any instrumentality or agency thereof having in each instance a final maturity date of less than one year from their date of purchase or other Permitted Investments, (ii) seeks to maintain a constant net asset value per share and (iii) has aggregate net assets of not less than $100,000,000 on the date of purchase of such shares, and which satisfies the Rating Agency Condition; provided, however, that only -------- ------- those investments described above which are permitted to be made by a national banking association shall be deemed to be "Permitted Investments" hereunder. "Person" means any legal person, including any individual, ------ corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, governmental entity or other entity of similar nature. "Pooling and Servicing Agreement" means the Amended and Restated ------------------------------- Pooling and Servicing Agreement, dated as of February 1, 1999 and heretofore amended, among FCNB and The Bank of New York (as successor-in- interest to the corporate trust administration of Harris Trust and Savings Bank), as trustee. "Portfolio Yield" is defined, with respect to any Series, in the --------------- related Indenture Supplement. "Principal Collections" means all Collections that are not Finance --------------------- Charge Collections. "Principal Collections Subaccount" means the principal collections -------------------------------- subaccount of the Collections Account. "Principal Receivable" means each Receivable other than Finance Charge -------------------- Receivables and Receivables in Defaulted Accounts. A Principal Receivable shall be deemed to have been created at the end of the day on the Date of Processing of such Receivable. In calculating the aggregate amount of Principal Receivables on any day, the amount of Principal Receivables shall be reduced by the aggregate amount of credit balances in the Accounts on such day. Any Principal Receivables which Seller is unable to transfer as provided in Section 2.5(c) of the Transfer and Servicing Agreement shall -------------- not be included in calculating the aggregate amount of Principal Receivables. "Principal Sharing Series" means a Series that, pursuant to the ------------------------ Indenture Supplement therefor, is entitled to receive Shared Principal Collections. "Principal Shortfalls" is defined in Section 8.5 of the Indenture. -------------------- ----------- -20- "Principal Terms" means, with respect to any Series, (a) the name or --------------- designation; (b) the initial principal amount (or method for calculating such amount), the Collateral Amount and the Seller Amount; (c) the Note Interest Rate for each Class of Notes of such Series (or method for the determination thereof); (d) the payment date or dates and the date or dates from which interest shall accrue; (e) the method for allocating Collections to Noteholders; (f) the designation of any Series Accounts and the terms governing the operation of any such Series Accounts; (g) the Servicing Fee; (h) the terms of any form of Series Enhancements with respect thereto; (i) the terms on which the Notes of such Series may be exchanged for Notes of another Series, repurchased by the Seller or remarketed to other investors; (j) the Series Termination Date; (k) the number of Classes of Notes of such Series and, if more than one Class, the rights and priorities of each such Class; (l) the extent to which the Notes of such Series will be issuable in temporary or permanent global form (and, in such case, the depositary for such global note or notes, the terms and conditions, if any, upon which such global note or notes may be exchanged, in whole or in part, for Definitive Notes, and the manner in which any interest payable on a temporary or global note will be paid); (m) whether the Notes of such Series may be issued in bearer form and any limitations imposed thereon; (n) the priority of such Series with respect to any other Series; (o) whether such Series will be part of a Group; (p) whether such Series will be a Principal Sharing Series and whether such Series is entitled to share Shared Seller Principal Collections; (q) whether such Series will be an Excess Allocation Series; (r) the Distribution Date; (s) the legal final maturity date on which the rights of the Noteholders of such Series to receive payments from the Issuer will terminate, which shall not be later than the Scheduled Trust Termination Date; (t) whether Interchange will be included in the funds available to be paid for such Series; and (u) whether such Series will or may be a Paired Series and the Series, with which it will be paired, if applicable. "Proceeding" means any suit in equity, action at law or other judicial ---------- or administrative proceeding. "Qualified Account" means either (a) a non-interest bearing segregated ----------------- account with an Eligible Institution, or (b) a non-interest bearing segregated trust account with the corporate trust department of a depository institution organized under the laws of the United States or any one of the states thereof, including the District of Columbia (or any domestic branch of a foreign bank), and acting as a trustee for funds deposited in such account, so long as any of the securities of such depository institution shall have a credit rating from each Rating Agency in one of its generic credit rating categories that signifies investment grade. "Quarterly Account Additions" means on any Determination Date, the --------------------------- number of Accounts the Receivables of which have been added to the Receivables -21- Trust pursuant to Sections 2.6(a), (b) and (e) of the Transfer and Servicing --------------- --- --- Agreement during the current calendar quarter. "Quarterly Quotient" is defined in Section 2.6(c)(ii)(2) of the Transfer ------------------ --------------------- and Servicing Agreement. "Rating Agency" means, with respect to any outstanding Series or Class, ------------- each rating agency, as specified in the applicable Indenture Supplement, selected by the Seller to rate the Notes of such Series or Class. "Rating Agency Condition" means, with respect to any action or series of ----------------------- related actions or proposed transaction or series of related proposed transactions, that each Rating Agency shall have notified Seller and the Indenture Trustee in writing that such action or series of related actions or the consummation of such proposed transaction or series of related transactions will not result in a reduction or withdrawal of the rating of any outstanding Series or Class with respect to which it is a Rating Agency. "Reassignment Agreement" is defined in Section 2.7(b)(ii) of the ---------------------- ------------------ Transfer and Servicing Agreement. "Receivable" means any amount owing by an Obligor under an Account ---------- (including amounts in Defaulted Accounts) from time to time, including amounts owing for the purchase of goods and services, Finance Charges, Cash Advance Fees, Cardholder Fees, Special Fees and premiums for Credit Insurance, if any. "Receivables Trust" means (a) prior to the FCMT Termination Date, First ----------------- Consumers Master Trust and (b) on and after the FCMT Termination Date, the Issuer. "Record Date" means, with respect to any Distribution Date, the last ----------- Business Day of the calendar month immediately preceding such Distribution Date unless otherwise specified for a Series in the related Indenture Supplement. "Recoveries" means, with respect to any Monthly Period, all amounts ---------- received, including Insurance Proceeds and net proceeds from the liquidation of certificates of deposit or bank accounts, by the Servicer with respect to Receivables which have previously been charged off as uncollectible, after deducting, in the case of each such amount received, a percentage of such amount which in the good faith judgment of the Servicer represents the amount of out-of-pocket costs incurred by the Servicer during the preceding fiscal year (or other, more recent period deemed appropriate by the Servicer) as a percentage of collections during such period in -22- respect of charged off receivables in all credit card accounts (including the Accounts) serviced by the Servicer. "Redemption Date" means, with respect to any Series, the date or dates --------------- specified in the related Indenture Supplement. "Registered Notes" is defined in Section 2.1 of the Indenture. ---------------- ----------- "Removal Date" is defined in Section 2.7 of the Transfer and Servicing ------------ ----------- Agreement. "Removal Notice Date" means the fifth Business Day prior to a Removal ------------------- Date. "Removed Accounts" is defined in Section 2.7(a) of the Transfer and ---------------- -------------- Servicing Agreement. "Requirements of Law" for any Person means the certificate of ------------------- incorporation or articles of association and by-laws or other organizational or governing documents of such Person, and any law, treaty, rule or regulation, or order or determination of an arbitrator or Governmental Authority, in each case applicable to or binding upon such Person or to which such Person is subject, whether Federal, state or local (including usury laws, the Federal Truth in Lending Act and Regulation Z and Regulation B of the Board of Governors of the Federal Reserve System). "Responsible Officer" means, as to the Issuer, the Chairman or any Vice ------------------- Chairman of the Board of Directors or Trustees of the Administrator; the Chairman or Vice Chairman of the Executive or Standing Committee of the Board of Directors or Trustees of the Administrator; and the President, any Executive Vice President, Senior Vice President, Vice President, any Assistant Vice President, the Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer, the Cashier, any Assistant or Deputy Cashier, the Controller and any Assistant Controller or any other officer of the Administrator customarily performing functions similar to those performed by any of the above-designated officers. The term "Responsible Officer", when used herein with respect to any Person other than the Issuer, means an officer or employee of such Person corresponding to any officer or employee described in the preceding sentence. "Scheduled Trust Termination Date" means December 31, 2050. -------------------------------- "Securities Act" means the Securities Act of 1933. -------------- "Seller" means FCNB. ------ -23- "Seller Amount" means, on any Determination Date, the Aggregate ------------- Principal Balance at the end of the day immediately prior to such Determination Date, minus the Aggregate Collateral Amount at the end of such day. "Seller Certificate Supplement" shall have the meaning specified in ----------------------------- Section 3.4 of the Trust Agreement. "Seller Interest" means the interest of the Seller or its assigns in the --------------- Issuer and the Receivables, which entitles the Seller or its assigns to receive the various amounts specified in the Transaction Documents to be paid or transferred to the holder(s) of the Seller Interest. "Seller Percentage" means, on any date of determination, when used with ----------------- respect to Principal Collections, Finance Charge Collections and Receivables in Defaulted Accounts, the percentage equivalent of a fraction equal to 1.0, minus ----- the fraction calculated on such date with respect to such categories of Receivables in accordance with the definition of Aggregate Allocation Percentage; provided, however, that the Seller Percentage shall never be less -------- ------- than zero. "Series" means any series of Notes, which may include within any such ------ Series a Class or Classes of Notes subordinate to another such Class or Classes of Notes. "Series Account" means, with respect to any Series, any of the accounts -------------- established and designated as such pursuant to the related Indenture Supplement. "Series Enhancement" means the rights and benefits provided to the ------------------ Issuer or the Noteholders of any Series or Class pursuant to any letter of credit, surety bond, cash collateral account, collateral interest, spread account, reserve account, cash collateral guaranty, insurance policy, tax protection agreement, interest rate swap agreement, interest rate cap agreement, cross support feature or other similar arrangement. The subordination of any Series or Class to another Series or Class shall be deemed to be a Series Enhancement. "Series Enhancer" means the Person or Persons providing any Series --------------- Enhancement, other than (except to the extent otherwise provided with respect to any Series in the Indenture Supplement for such Series) any account or deposits therein or the Noteholders of any Series or Class which is subordinated to another Series or Class. "Series Pay Out Event" is defined, with respect to any Series, in the -------------------- related Indenture Supplement. -24- "Series Share" is defined in Section 8.4(h) of the Indenture. ------------- -------------- "Series Termination Date" means, with respect to any Series, the ----------------------- termination date for such Series specified in the related Indenture Supplement. "Servicer" means initially FCNB, and thereafter any Person appointed as -------- successor as herein provided to service the Receivables. "Servicer Default" is defined in Section 7.1 of the Transfer and ---------------- ----------- Servicing Agreement. "Servicing Fee Rate" means, with respect to any Series, the Series ------------------ servicing fee percentage specified in the related Indenture Supplement. "Servicing Officer" means any employee of the Servicer involved in, or ----------------- responsible for, the administration and servicing of the Receivables whose name appears on a list of servicing officers furnished to the Indenture Trustee by the Servicer, as such list may from time to time be amended. "Shared Finance Charge Collections" means, with respect to any --------------------------------- Distribution Date, the aggregate amount for all outstanding Series that the related Indenture Supplements specify are to be treated as "Shared Finance Charge Collections" for such Distribution Date. "Shared Principal Collections" is defined in Section 8.5 of the ---------------------------- ----------- Indenture. "Shortfall Amount" means, on any Determination Date, the amount, if any, ---------------- by which the Minimum Seller Amount exceeds the Seller Amount. "Special Fees" means Receivables consisting of fees which are not now ------------ but may from time to time be assessed on the Accounts. "Spiegel" means Spiegel, Inc., a Delaware corporation. ------- "Standard & Poor's" means Standard & Poor's Ratings Services, or its ----------------- successor. "Successor Servicer" is defined in Section 7.2(a) of the Transfer and ------------------ -------------- Servicing Agreement. "Supplemental Certificate" is defined in Section 3.4 of the Trust ------------------------ ----------- Agreement. -25- "Surviving Person" is defined in Section 3.10(a) of the Indenture. ---------------- --------------- "Tax Opinion" means, with respect to any action, an Opinion of Counsel ----------- to the effect that, for federal income tax purposes, (a) such action will not adversely affect the tax characterization as debt of the Notes of any outstanding Series or Class that were characterized as debt at the time of their issuance, (b) such action will not cause the Issuer to be deemed to be an association (or publicly traded partnership) taxable as a corporation and (c) such action will not cause or constitute an event in which gain or loss would be recognized by any Noteholder. "Termination Notice" is defined in Section 7.1 of the Transfer and ------------------ ----------- Servicing Agreement. "Transaction Documents" means the Master Indenture, Indenture --------------------- Supplements, Transfer and Servicing Agreement, Trust Agreement, Administration Agreement, and, until the FCMT Termination Date, the Pooling and Servicing Agreement and the Collateral Series Supplement, and any other documents related to this transaction. "Transfer Agent and Registrar" is defined in Section 2.5 of the ---------------------------- ----------- Indenture. "Transfer and Servicing Agreement" means the Transfer and Servicing -------------------------------- Agreement, dated as of March 1, 2001, between FCNB and the Issuer. "Transfer Date" means the Business Day immediately preceding each ------------- Distribution Date or each Distribution Date. "Transfer Restriction Event" means any event that prevents the Seller -------------------------- from transferring Receivables to the Issuer. "Trust" means the First Consumers Credit Card Master Note Trust. ----- "Trust Agreement" means the Trust Agreement relating to the Receivables --------------- Trust, dated as of March 1, 2001, between FCNB and the Owner Trustee, as the same may be amended, supplemented or otherwise modified from time to time. "Trust Assets" is defined in Section 2.1 of the Transfer and Servicing ------------ ----------- Agreement. "Trust Estate" means all right, title and interest of the Issuer in and ------------ to the property and rights assigned to the Issuer pursuant to Section 2.5 of the ----------- Trust Agreement and Section 2.1 of the Transfer and Servicing Agreement, all ----------- monies, investment property, instruments and other property on deposit from time to time in -26- the Collection Account, the Series Accounts and the Excess Funding Account and all other property of the Issuer from time to time, including any rights of the Owner Trustee and the Issuer pursuant to the Transaction Documents. "Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939. ------------------- --- "Trust Pay Out Event" is defined, with respect to each Series, in ------------------- Section 5.1 of the Indenture. - ----------- "Trust Termination Date" is defined in Section 8.1 of the Trust ---------------------- Agreement. "Trustee Officer" means, with respect to the Indenture Trustee any --------------- officer assigned to the Corporate Trust Office, including any managing director, vice president, assistant vice president, assistant treasurer, assistant secretary or any other officer of the Indenture Trustee customarily performing functions similar to those performed by any of the above designated officers and having direct responsibility for the administration of the applicable Transaction Documents, and also, with respect to a particular matter, any other officer, to whom such matter is referred because of such officer's knowledge of and familiarity with the particular subject. "UCC" means the Uniform Commercial Code, as in effect in any specified --- jurisdiction. -27- EX-4.2 4 0004.txt INDENTURE SUPPLEMENT AS OF MARCH 1, 2001 Exhibit 4.2 ----------- FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST Issuer and THE BANK OF NEW YORK Indenture Trustee Series 2001-A INDENTURE SUPPLEMENT Dated as of March 1, 2001
Table of Contents ARTICLE I Creation of the Series 2001-A Notes...................................... 1 Section 1.1 Designation............................................... 1 ARTICLE II Definitions.............................................................. 1 Section 2.1 Definitions............................................... 1 ARTICLE III Servicing Fee........................................................... 16 Section 3.1 Servicing Compensation................................... 16 ARTICLE IV Rights of Series 2001-A Noteholders and Allocation and Application of Collections.............................................. 17 Section 4.1 Collections and Allocations.............................. 17 Section 4.2 Determination of Monthly Interest........................ 19 Section 4.3 Determination of Monthly Principal....................... 21 Section 4.4 Application of Available Finance Charge Collections and Available Principal Collections.............................................. 22 Section 4.5 Investor Charge-Offs..................................... 26 Section 4.6 Reallocated Principal Collections........................ 26 Section 4.7 Excess Finance Charge Collections........................ 27 Section 4.8 Shared Principal Collections............................. 27 Section 4.9 Principal Accumulation Account........................... 27 Section 4.10 Reserve Account.......................................... 29 Section 4.11 Swaps.................................................... 31 Section 4.12 Determination of LIBOR................................... 32 Section 4.13 Investment Instructions. ............................... 32 Section 4.14 Controlled Accumulation Period........................... 33 Section 4.15 Suspension of Controlled Accumulation Period................................................... 33 Section 4.16 Interchange.............................................. 35 Section 4.17 Spread Account........................................... 35 ARTICLE V Delivery of Series 2001-A Notes; Distributions; Reports to Series 2001-A Noteholders............................................... 38 Section 5.1 Delivery and Payment for the Series 2001-A Notes................................... 38 Section 5.2 Distributions......................................... 38 Section 5.3 Reports and Statements to Series 2001-A Noteholders........................................... 39
i
ARTICLE VI Series 2001-A Pay Out Events............................................ 40 Section 6.1 Series 2001-A Pay Out Events.............................. 40 ARTICLE VII Redemption of Series 2001-A Notes; Final Distributions; Series Termination...................................................... 41 Section 7.1 Optional Redemption of Series 2001-A Notes; Final Distributions................................ 42 Section 7.2 Series Termination........................................ 43 ARTICLE VIII Miscellaneous Provisions................................................ 44 Section 8.1 Ratification of Indenture; Amendments..................... 44 Section 8.2 Form of Delivery of the Series 2001-A Notes..................................................... 44 Section 8.3 Additional Requirements for Registration of and Limitations on Transfer and Exchange of Class C Notes.......................................... 44 Section 8.4 Counterparts.............................................. 44 Section 8.5 GOVERNING LAW............................................. 44 Section 8.6 Limitation of Liability................................... 44 Section 8.7 Rights of the Indenture Trustee........................... 45
ii 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 TO THE INDENTURE TRUSTEE EXHIBIT C FORM OF MONTHLY NOTEHOLDERS' STATEMENT EXHIBIT D-1 FORM OF CLASS A SWAP EXHIBIT D-2 FORM OF CLASS B SWAP iii SERIES 2001-A INDENTURE SUPPLEMENT, dated as of March 1, 2001 (the "Indenture Supplement"), -------------------- between FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, a trust organized and existing under the laws of the State of Illinois (herein, the "Issuer" or the ------ "Trust"), and THE BANK OF NEW YORK, a banking corporation organized and existing ----- under the laws of the State of New York, 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 March 1, 2001 (the - ------- "Indenture") between the Issuer and the Indenture Trustee (the Indenture, - ---------- together with this Indenture Supplement, the "Agreement"). Pursuant to --------- Section 2.12 of the Indenture, the Seller 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 2001-A Notes Section 1.1 Designation. ----------- (1) 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 "First Consumers Credit Card Master Note Trust, Series 2001-A" or the "Series ------------------------------------------------------------ ------ 2001-A Notes." The Series 2001-A Notes shall be issued in three Classes, known - ------------ as the "Class A Series 2001-A Floating Rate Asset Backed Notes," the "Class B ------------------------------------------------------ ------- Series 2001-A Floating Rate Asset Backed Notes," and the "Class C Series 2001-A - ---------------------------------------------- --------------------- Floating Rate Asset Backed Notes." - -------------------------------- (2) Series 2001-A shall be included in Group One and shall be a Principal Sharing Series. Series 2001-A shall be an Excess Allocation Series with respect to Group One only. Series 2001-A 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 Period Factor" means, for any Monthly Period, a fraction, -------------------------- the numerator of which is equal to the sum of the Initial Collateral Amounts of all outstanding Series designated as Principal Sharing Series, and the denominator of which is equal to the sum of (a) the Initial Collateral Amount and (b) the Initial Collateral Amounts of all outstanding Series designated as Principal Sharing Series (other than Series 2001-A) which are not expected to be in their revolving periods; provided, however, that this definition may be changed at any time if the Rating - -------- ------- Agency Condition is satisfied. "Accumulation Period Length" is defined in subsection 4.14. -------------------------- --------------- "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. "Allocation Percentage" means, on any date of determination, the --------------------- percentage equivalent of a fraction: (a) the numerator of which shall be the Collateral Amount, determined: (i) for Principal Collections during the Revolving Period and for Finance Charge Collections and Default Amounts at any time, 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); or (ii) for Principal Collections during the Rapid Amortization Period, the Class C Amortization Period and the Controlled Accumulation Period, on the last day of the Revolving Period, provided, however, that if Series 2001-A is paired with a -------- ------- Paired Series and a Rapid Amortization Period commences for such Paired Series, the Seller may, by written notice to the Indenture Trustee, the Servicer and the Rating Agencies, but only after satisfying the Rating Agency Condition, 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 (b) the denominator of which shall be the greater of (x) the Aggregate Principal Balance at the end of the Business Day preceding such date of determination 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 on such date of determination. "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) any Net Swap Receipts for the related Distribution Date, plus (c) the Excess Finance Charge Collections allocated to Series 2001-A for such Monthly Period, plus (d) Principal Accumulation Investment Proceeds, if any, with respect to the related Distribution Date and (e) amounts, if any, to be withdrawn from the Reserve Account which will be deposited into the Collection Account on the 2 related Distribution 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 2001-A pursuant to the Agreement 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 Distribution Date, -------------------------------- the lesser of (a) the amount on deposit in the Reserve Account on such date (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)(vii) to the Reserve --------------------- Account on such date) and (b) the Required Reserve Account Amount. "Available Spread Account Amount" means, for any DistriBution Date, an ------------------------------- amount equal to the lesser of (a) the amount on deposit in the Spread Account (exclusive of Investment Earnings, unless and until the occurrence of an Event of Default with respect to Series 2001-A and acceleration of the maturity of the Series 2001-A Notes pursuant to Section 5.3 of the Indenture) on such date ----------- (before giving effect to any deposit to, or withdrawal from, the Spread Account made or to be made with respect to such date) and (b) the Spread Account Cap for such Distribution Date. "Average Excess Spread Percentage" means, with respect to any -------------------------------- Distribution Date, the percentage equivalent of a fraction the numerator of which is the sum of the Excess Spread Percentages with respect to the immediately preceding three Monthly Periods and the denominator of which is three. "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, (b) the Net Swap Payments and (c) the Monthly Servicing Fee, each with respect to the related Distribution Date, and the denominator of which is the Collateral Amount as of the first day of such Monthly Period. "Class A Additional Interest" is defined in subsection 4.2(a). --------------------------- ----------------- "Class A Counterparty" means Deutsche Bank AG New York Branch, a branch -------------------- of Deutsche Bank Aktiengesellschaft, a banking company incorporated under the laws of Germany, or the counterparty under any interest rate swap with respect to the Class A Notes obtained pursuant to Section 4.11. ------------ "Class A Expected Principal Distribution Date" means the February 2006 -------------------------------------------- Distribution Date. "Class A Interest Shortfall" is defined in subsection 4.2(a). -------------------------- ----------------- "Class A Monthly Interest" is defined in subsection 4.2(a). ------------------------ ----------------- 3 "Class A Monthly Principal" is defined in subsection 4.3(a). ------------------------- ---------------- "Class A Net Swap Payment" means any net amount payable by the Issuer ------------------------ under the Class A Swap as a result of LIBOR being less than the Class A Swap Rate. For the avoidance of doubt, Class A Net Swap Payments do not include early termination payments or payment of breakage or other miscellaneous costs. "Class A Net Swap Receipt" means any net amount payable by the Class A ------------------------ Counterparty as a result of LIBOR being greater than the Class A Swap Rate. For the avoidance of doubt, Class A Net Swap Receipts do not include early termination payments. "Class A Note Initial Principal Balance" means $462,000,000. -------------------------------------- "Class A Note Interest Rate" means a per annum rate of 0.31% in excess -------------------------- of LIBOR as determined on the LIBOR Determination Date for the applicable Interest 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 -------------------- Available Finance Charge Collections applied to pay such amount pursuant to subsection 4.4(a). - ---------------- "Class A Swap" means an interest rate swap agreement with respect to ------------ the Class A Notes between the Owner Trustee, on behalf of the Trust, and the Class A Counterparty substantially in the form of Exhibit D-1 to this Indenture ----------- Supplement, or such other form as shall have satisfied the Rating Agency Condition. "Class A Swap Rate" means 5.665% per annum. ----------------- "Class B Additional Interest" is defined in subsection 4.2(b). --------------------------- ----------------- "Class B Counterparty" means Deutsche Bank AG New York Branch, a -------------------- branch of Deutsche Bank Aktiengesellschaft, a banking company incorporated under the laws of Germany, or the counterparty under any interest rate swap with respect to the Class B Notes obtained pursuant to Section 4.11. ------------ "Class B Expected Principal Distribution Date" means the March 2006 -------------------------------------------- Distribution Date. "Class B Interest Shortfall" is defined in subsection 4.2(b). -------------------------- ----------------- "Class B Monthly Interest" is defined in subsection 4.2(b). ------------------------ ---------------- "Class B Monthly Principal" is defined in subsection 4.3(b). ------------------------- ----------------- "Class B Net Swap Payment" means any net amount payable by the Issuer ------------------------ under the Class B Swap as a result of LIBOR being less than the Class B Swap Rate. 4 For the avoidance of doubt, Class B Net Swap Payments do not include early termination payments or payment of breakage or other miscellaneous costs. "Class B Net Swap Receipt" means any net amount payable by the Class B ------------------------ Counterparty as a result of LIBOR being greater than the Class B Swap Rate. For the avoidance of doubt, Class B Net Swap Receipts do not include early termination payments. "Class B Note Initial Principal Balance" means $63,000,000. -------------------------------------- "Class B Note Interest Rate" means a per annum rate of 1.10% in excess -------------------------- of LIBOR as determined on the LIBOR Determination Date for the applicable Interest Period. "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 --------------------- Available Finance Charge Collections applied to pay such amount pursuant to subsection 4.4(a). - ----------------- "Class B Swap" means an interest rate swap agreement between the Owner ------------ Trustee, on behalf of the Trust, and the Class B Counterparty substantially in the form of Exhibit D-2 to this Indenture Supplement, or such other form as ----------- shall have satisfied the Rating Agency Condition. "Class B Swap Rate" means 5.670% per annum. ----------------- "Class C Additional Interest" is defined in subsection 4.2(c). --------------------------- ----------------- "Class C Amortization Period" means, unless the Rapid Amortization --------------------------- Period shall have commenced prior thereto, the period commencing on the Class C Principal Commencement Date and ending on the first to occur of (a) the commencement of the Rapid Amortization Period and (b) the Series Termination Date. "Class C Interest Shortfall" is defined in subsection 4.2(c). -------------------------- ----------------- "Class C Maximum Note Interest Rate" means a per annum rate of 2.50% in ---------------------------------- excess of LIBOR as determined on the LIBOR Determination Date for the applicable Interest Period. "Class C Monthly Interest"is defined in subsection 4.2(c). ------------------------ ----------------- "Class C Monthly Principal" is defined in subsection 4.3(c). ------------------------- ----------------- "Class C Note Initial Principal Balance" means $36,000,000. -------------------------------------- "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 5 aggregate amount of principal payments made to the Class C Noteholders on or prior to such date. "Class C Note Purchase Agreement" means the Note Purchase Agreement, ------------------------------- dated as of March 6, 2001, between FCNB, Spiegel and the initial purchaser of the Class C Notes. "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. ----------- "Class C Principal Commencement Date" shall mean the Distribution Date ----------------------------------- on which the Class A Note Principal Balance and the Class B Note Principal Balance have been paid in full. "Class C Required Amount" means, for any Distribution Date, an amount ----------------------- equal to the excess of the amount described in subsection 4.4(a)(iv) 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 Spread ---------------- Account and applied to pay such amount pursuant to subsection 4.17(c). ------------------- "Closing Date" means March 6, 2001. ------------ "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 2001-A Noteholders, minus (c) the balance on deposit in the Principal Accumulation Account, minus (d) the aggregate reductions to the Collateral Amount made pursuant to Section ------- 4.4(c)(vi) 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 Distribution Date with ------------------------------ respect to the Controlled Accumulation Period, $43,750,000; provided, however, -------- ------- that if the 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 Class A Note Initial Principal Balance and the Class B Note Initial Principal Balance divided by (ii) the Accumulation Period Length; provided, further, that the Controlled Accumulation Amount for any Distribution - -------- ------- Date shall not exceed the sum of the Class A Note Principal Balance and the Class B Note Principal Balance, minus any amount already on deposit in the Principal Accumulation Account on such Distribution Date. "Controlled Accumulation Period" means, unless a Pay Out Event shall ------------------------------ have occurred prior thereto, the period commencing at the opening of business on February 1, 2005 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 - ---- ---- Rapid 6 Amortization Period, (b) the Class C Principal Commencement Date and (c) the Series Termination Date. "Controlled Deposit Amount" means, for any Distribution Date with ------------------------- respect to the Controlled Accumulation Period, an amount equal to the sum of the Controlled Accumulation Amount for such Distribution Date and any existing Accumulation Shortfall. "Counterparty" means the Class A Counterparty or the Class B ------------ Counterparty. "Covered Amount" means an amount, determined as of each Distribution -------------- Date for any Interest 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 Interest Period and the denominator of which is 360, times (ii) the Class A Note Interest Rate in effect with respect to such Interest 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 Distribution Date, plus (b) the product of (i) a fraction, the numerator of which is the actual number of days in such Interest Period and the denominator of which is 360, times (ii) the Class B Note Interest Rate in effect with respect to such Interest 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 Distribution Date up to the Class B Note Principal Balance as of the Record Date preceding such Distribution Date. "Default Estimate" means, for any Monthly Period, an amount equal to ---------------- the product of (i) 1.5, multiplied by (ii) the arithmetic mean of the Investor Default Amounts for the prior three Monthly Periods. For this purpose, the December 2000, January 2001 and February 2001 Investor Default Amounts shall be deemed to have equaled $5,000,000. "Distribution Date" means April 16, 2001 and the 15th day of each ----------------- calendar month thereafter, or if such 15th day is not a Business Day, the next succeeding Business Day. "Excess Collateral Amount" means, at any time, the result of the ------------------------ Collateral Amount, plus the Principal Accumulation Account Balance, minus the Note Principal Balance. "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. "Finance Charge Shortfall" is defined in Section 4.7. ------------------------ ----------- "Group One" means Series 2001-A, 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. "Initial Collateral Amount" means $600,000,000, which equals the sum of ------------------------- (i) the Class A Note Initial Principal Balance, plus, (ii) the Class B Note Initial Principal Balance, plus, (iii) the Class C Note Initial Principal Balance plus (iv) the Initial Excess Collateral Amount. 7 "Initial Excess Collateral Amount" means $39,000,000. -------------------------------- "Interest 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. "Investment Earnings" means, for any Distribution Date, all interest ------------------- and earnings on Permitted 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, for any Distribution Date, an amount ----------------------- equal to the product of (a) the Default Amount for the related Monthly Period and (b) the daily average Allocation Percentage for such Monthly Period. "Investor Finance Charge Collections" means, for any Monthly Period, an ----------------------------------- amount equal to the aggregate amount of Finance Charge Collections (including Net Recoveries and Interchange treated as Finance Charge Collections) retained or deposited in the Finance Charge Subaccount for Series 2001-A pursuant to subsection 4.1(b)(i) for such Monthly Period. - -------------------- "Investor Principal Collections" means, for any Monthly Period, the ------------------------------ aggregate amount of Principal Collections retained or deposited in the Principal Collections Subaccount for Series 2001-A pursuant to subsection 4.1(b)(ii) for -------------------- such Monthly Period. "Investor Uncovered Dilution Amount" means, for any Distribution Date, ---------------------------------- an amount equal to the Series Share of shortfalls in Deposit Obligations that is allocated to Series 2001-A pursuant to Section 8.4(h) of the Indenture. -------------- "LIBOR" means, for any Interest Period, the London interbank offered ----- rate for one-month United States dollar deposits determined by the Indenture Trustee for each Interest Period in accordance with the provisions of Section ------- 4.12. - ---- "LIBOR Determination Date" means (i) March 2, 2001 for the period from ------------------------ and including the Closing Date through and including April 15, 2001 and (ii) the second London Business Day prior to the commencement of the second and each subsequent Interest Period. "London Business Day" means any day on which dealings in deposits in ------------------- United States dollars are transacted in the London interbank market. "Maximum Reallocated Principal Reserves Amount" means, with respect to --------------------------------------------- any Monthly Period, the sum of the Net Interest Obligations and the Monthly Servicing Fee payable on the Distribution Date following such Monthly Period. "Maximum Release Amount" is defined in the Class C Note Purchase ---------------------- Agreement. "Minimum Seller Percentage" means 7% for Series 2001-A. ------------------------- 8 "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 -------- April 2001 Distribution Date shall mean the period from and including the Closing Date to and including the last day of March 2001. "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) 23.0% 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; (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) 12.5% 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; (c) the lower of (i) the sum of the Class C Required Amount and (ii) the greater of (A)(x) the product of (I) 6.5% 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 clauses (a) and (b) above) and (B) zero; and ---------- --- (d) if the Rapid Amortization Period is extended past the Distribution Date on which the Note Principal Balance is paid in full as a result of there being amounts owed to the Class C Noteholders under the Class C Note Purchase Agreement or to the Class A Counterparty or Class B Counterparty under the Class A Swap or Class B Swap, as applicable, then for any Distribution Date falling on or after the Distribution Date on which the Note Principal Balance is paid in full, the least of (i) the sum of any amounts owed to Class C Noteholders that remain outstanding under the Class C Note Purchase Agreement, any amounts owed to the Class A Counterparty that remain outstanding under the Class A Swap and any amounts owed to the Class B Counterparty that remain outstanding under the Class B Swap, (ii) (A) 6.5% of the Initial Collateral Amount, minus (B) any prior reductions to the Excess Collateral Amount and (iii) (A) the Excess 9 Collateral Amount (after giving effect to Investor Charge-Offs for the related Monthly Period), minus, (B) in the case of the Distribution Date on which the Note Principal Balance is paid in full, any Reallocated Principal Collections applied pursuant to clauses (a), (b) ----------- --- and (c) for such Distribution Date. --- "Monthly Servicing Fee" is defined in subsection 3.1. --------------------- -------------- "Net Interest Obligation" means, for any Distribution Date: (a) if ----------------------- there are Net Swap Payments due on that Distribution Date, the sum of the Net Swap Payments and the Monthly Interest for that Distribution Date; (b) if there are Net Swap Receipts due on that Distribution Date, the result of the Monthly Interest for that Distribution Date minus the Net Swap Receipts; and (c) if the Swaps have terminated for any reason, the Monthly Interest for that Distribution Date. "Net Swap Payments" means, collectively, the Class A Net Swap Payment ----------------- and the Class B Net Swap Payment. "Net Swap Receipts" means, collectively, the Class A Net Swap Receipt ----------------- and the Class B Net Swap Receipt. "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. "Percentage Allocation" is defined in subsection 4.1(b)(ii)(y). --------------------- ------------------------ "Portfolio Yield" means, for any Monthly Period, the annualized --------------- percentage equivalent of a fraction, (a) the numerator of which is equal to the sum of (i) Investor Finance Charge Collections with respect to such Monthly Period, plus (ii) the Principal Accumulation Investment Proceeds deposited into the Collection Account on the Distribution Date related to such Monthly Period, plus (iii) the amount of the Reserve Draw Amount (up to the Available Reserve Account Amount) plus any amounts of interest and earnings described in Section ------- 4.10, each deposited into the Collection Account on the Distribution Date - ---- relating to such Monthly Period, plus (iv) the amount of Net Swap Receipts for the Distribution Date relating to such Monthly Period, such sum to be calculated on a cash basis after subtracting the Investor Default Amount for such Monthly Period, and (b) the denominator of which is the Collateral Amount as of the first day of such Monthly Period. "Principal Accumulation Account" shall have the meaning set forth 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 Distribution 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 Distribution Date to but excluding such Distribution Date. "Principal Payment Rate" means, for any Monthly Period, (a) the ---------------------- aggregate amount of Principal Collections deposited in the Collection Account during that 10 Monthly Period, divided by (b) the Aggregate Principal Receivables as of the close of business on the last day of the prior Monthly Period. "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 Class A Expected Principal Distribution Date in an amount equal to the Class A Note Initial Principal Balance and to make a deposit into the Principal Accumulation Account on the Class B Expected Principal Distribution Date in an amount equal to the Class B Note Initial Principal Balance "Rapid Amortization Period" means the period commencing on the Business ------------------------- Day immediately preceding the day on which a Pay Out Event with respect to Series 2001-A is deemed to have occurred, and ending on the Series Termination Date; provided, that if any amounts are owed to the Class C Noteholders under -------- the Class C Note Purchase Agreement, to the Class A Counterparty under the Class A Swap or to the Class B Counterparty under the Class B Swap after payment in full of the Note Principal Balance, the Rapid Amortization Period shall continue, solely for the purposes of repaying such amounts, but in no event shall the Rapid Amortization Period continue after the earliest of (x) the date on which no further amounts are owed to the Class C Noteholders under the Class C Note Purchase Agreement or to any Counterparty under the Class A Swap or Class B Swap, (y) the Series 2001-A Final Maturity Date and (z) the date on which the Collateral Amount has been reduced to zero; provided, further, that if the Rapid -------- ------- Amortization Period is extended in accordance with the immediately preceding proviso, for purposes of calculating the Minimum Aggregate Principal Balance, for so long as the Rapid Amortization Period is so extended, (i) Series 2001-A shall be deemed to be outstanding, (ii) the Collateral Amount shall be included in the calculation of Aggregate Collateral Amount for purposes of clause (a) of the definition of Minimum Aggregate Principal Balance and (iii) the numerator used for purposes of the Allocation Percentage with respect to Principal Collections for Series 2001-A shall be included in the calculation described in clause (b) of the definition of Minimum Aggregate Principal Balance. "Rating Agency" means each of Fitch, Moody's and Standard & Poor's. ------------- "Reallocated Principal Collections" means, for any Distribution 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. "Reallocated Principal Reserves" is defined in subsection 4.1(b)(ii)(x). ------------------------------ ------------------------ "Reassignment Amount" means, for any Distribution Date, after giving effect ------------------- to any deposits and distributions otherwise to be made on such Distribution Date, the sum of (i) the Note Principal Balance on such Distribution Date, plus (ii) Monthly Interest for such Distribution Date and any Monthly Interest previously due but not distributed to the Series 2001-A Noteholders, plus (iii) the amount of Additional Interest, if any, for such Distribution Date and any Additional Interest previously due but not distributed to the Series 2001-A Noteholders on a prior Distribution Date. 11 "Reference Banks" means four major banks in the London interbank market --------------- selected by the Servicer. "Required Accumulation Factor Number" shall be equal to a fraction, ----------------------------------- rounded upwards to the nearest whole number, the numerator of which is one and the denominator of which is equal to the lowest monthly Principal Payment Rate on the Accounts, expressed as a decimal, for the 12 months preceding the date of such calculation; provided, however, that this definition may be changed at any -------- ------- time if the Rating Agency Condition is satisfied. "Required Excess Collateral Amount" means, at any time, the lesser of --------------------------------- (a) $39,000,000 and (b) 7.5% of the Collateral Amount; provided that: -------- (a) except as provided in clause (c), the Required Excess ---------- Collateral Amount shall never be less than 3% of the Initial Collateral Amount; (b) except as provided in clause (c), the Required Excess ---------- Collateral Amount shall not decrease during a Rapid Amortization Period; and (c) the Required Excess Collateral Amount shall never be greater than the Note Principal Balance minus the balance on deposit in the Principal Accumulation Account. "Required Reserve Account Amount" means, for any Distribution Date on ------------------------------- or after the Reserve Account Funding Date, an amount equal to (a) 0.5% of the Note Principal Balance or (b) any other amount designated by the Seller; provided, however, that if such designation is of a lesser amount, the Seller - -------- ------- 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 Seller, such designation will not cause a Pay Out Event or an event that, after the giving of notice or the lapse of time, would cause a Pay Out Event to occur with respect to Series 2001-A. "Reserve Account" is defined in subsection 4.10(a). --------------- ------------------ "Reserve Account Funding Date" means the Distribution Date designated ---------------------------- by the Servicer which occurs not later than the earliest of (a) the Distribution 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 Distribution ------------ Date for which the Average Excess Spread Percentage is less than 2%, but in such event the Reserve Account Funding Date shall not be required to occur earlier than the Distribution Date with respect to the Monthly Period which commences 12 months prior to the commencement of the Controlled Accumulation Period; (c) the first Distribution Date for which the Average Excess Spread Percentage is less than 3%, but in such event the Reserve Account Funding Date shall not be required to occur earlier than the Distribution Date with respect to the Monthly Period which commences 6 months prior to the commencement of the Controlled Accumulation Period; and (d) the first Distribution Date for which the Average Excess Spread Percentage is less than 4%, but in such event the Reserve Account Funding Date shall 12 not be required to occur earlier than the Distribution 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 Distribution 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 Distribution Date ------------------- relating to the Controlled Accumulation Period or the first Distribution Date relating to the Rapid 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 Distribution Date. "Revolving Period" means the period beginning on the Closing Date and ---------------- ending on the earlier of the close of business on the day immediately preceding the day the Controlled Accumulation Period commences or the Rapid Amortization Period commences. "Series 2001-A" means the Series of Notes the terms of which are ------------- specified in this Indenture Supplement. "Series 2001-A Final Maturity Date" means the September 2008 --------------------------------- Distribution Date. "Series 2001-A Note" means a Class A Note, a Class B Note or a Class C ------------------ Note. "Series 2001-A Noteholder" means a Class A Noteholder, a Class B ------------------------ Noteholder or a Class C Noteholder. "Series 2001-A Pay Out Event" is defined in Section 6.1. --------------------------- ----------- "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 2001-A Final Maturity Date. "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 Available Finance Charge Collections applied to pay such amount pursuant to subsection 4.4(a). ----------------- "Spread Account" is defined in subsection 4.17(a). -------------- ------------------ "Spread Account Cap" is defined in the Class C Note Purchase Agreement. ------------------ "Spread Account Deficiency" means the excess, if any, of the Spread ------------------------- Account Cap over the Available Spread Account Amount. "Surplus Collateral Amount" means, at any time, the excess, if any, of ------------------------- the Excess Collateral Amount over the Required Excess Collateral Amount. "Telerate Page 3750" means the display page currently so designated on ------------------ the Bridge Telerate Markets Report (or such other page as may replace that page in that service for the purpose of displaying comparable rates or prices). 13 (b) Each capitalized term defined herein shall relate to the Series 2001-A 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 the Indenture or the Transfer and Servicing Agreement. (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 inconsistent with any term or provision contained in the Indenture, the terms and provisions of this Indenture Supplement shall be controlling. ARTICLE III Servicing Fee ------------- Section 3.1 Servicing Compensation. The share of the Servicing Fee ---------------------- allocable to Series 2001-A for any Distribution Date (the "Monthly Servicing ---------------------- Fee") shall be equal to one-twelfth of the product of (a) the Series Servicing - --- Fee Percentage and (b) (i) the Collateral Amount as of the last day of the Monthly Period preceding such Distribution Date, minus (ii) the product of the amount, if any, on deposit in the Excess Funding Account as of the last day of the Monthly Period preceding such Distribution Date and the Allocation Percentage for Finance Charge Collections with respect to such Monthly Period; provided, however, that with respect to the first Distribution Date, the Monthly - -------- ------ Servicing Fee shall be equal to $866,666.67. The remainder of the Servicing Fee shall be paid by the holders of the Seller 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 2001-A Noteholders be liable for the share of the Servicing Fee to be paid by the holders of the Seller Interest or the noteholders of any other Series. To the extent that the Monthly Servicing Fee is not paid in full pursuant to the preceding provisions of this Section ------- 3.1, and Section 4.4, it shall be paid by the holders of the Seller Interest. - --- ----------- ARTICLE IV Rights of Series 2001-A 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 2001-A pursuant to Article VIII of the ------------ Indenture shall be allocated and distributed as set forth in this Article. (b) Allocations to the Series 2001-A Noteholders. The Servicer shall, -------------------------------------------- prior to the close of business on any Deposit Date, allocate to the Series 2001-A Noteholders the following amounts as set forth below: (i) Allocations of Finance Charge Collections. The Servicer ----------------------------------------- shall allocate to the Series 2001-A Noteholders and transfer to the Finance Charge Subaccount for application as provided herein an amount equal to the product of (A) the Allocation Percentage and (B) the aggregate Finance Charge Collections deposited in the Collection Account on such Deposit Date; provided, however, that with respect to -------- ------- the portion of each Monthly Period falling in the Revolving Period or the Controlled Accumulation Period, such 14 allocation shall be transferred to the Finance Charge Subaccount only until such time as the amount transferred to the Finance Charge Subaccount pursuant to this subsection during that Monthly Period equals the sum of (1) the Net Interest Obligation with respect to the Distribution Date relating to that Monthly Period, (2) at any time that FCNB is not the Servicer, the Monthly Servicing Fee payable on the Distribution Date relating to that Monthly Period and all accrued and unpaid Investor Monthly Servicing Fees with respect to any prior Monthly Periods, and (3) the Default Estimate for that Monthly Period; provided further, however, that notwithstanding the foregoing proviso, -------- ------- ------- ------- (1) the entire Allocation Percentage of Finance Charge Collections shall be transferred to the Finance Charge Subaccount on a daily basis if (x) the Excess Spread Percentage for the preceding Monthly Period is less than 3.00% or (y) the Available Spread Account Amount is less than the Spread Account Cap; and (2) subject to Section 8.4(a) of the -------------- Indenture, on each Determination Date, the Servicer shall deposit in the Finance Charge Subaccount any amounts not retained on a daily basis pursuant to the preceding proviso. Any portion of such allocation not ------- required to be transferred to the Finance Charge Subaccount pursuant to the preceding sentence shall be (x) first, deposited in the Excess Funding Account to the extent the Seller Amount is less than the Minimum Seller Amount and (y) thereafter be paid to the holders of the Seller Interest. (ii) Allocations of Principal Collections. The Servicer shall ------------------------------------ allocate to the Series 2001-A Noteholders the following amounts as set forth below: (x) Allocations During the Revolving Period. During --------------------------------------- the Revolving Period an amount equal to the product of the Allocation Percentage and the aggregate amount of Principal Collections deposited in the Collection Account on such Deposit Date, shall be allocated to the Series 2001-A Noteholders and transferred to the Principal Collections Subaccount for application as Reallocated Principal Collections on the related Distribution Date pursuant to Section 4.6(a) (all such amounts retained in the Collection -------------- Account for application as Reallocated Principal Collections pursuant to this subsection 4.1(b)(ii)(x) being hereinafter ------------------------ referred to as "Reallocated Principal Reserves"); provided, ------------------------------ -------- however, that if the sum of (i) such Reallocated Principal ------- Reserves for any Deposit Date, (ii) all Reallocated Principal Reserves previously deposited in the Principal Collections Subaccount pursuant to this subsection 4.1(b)(ii)(x) on ------------------------ Deposit Dates occurring during the same Monthly Period and (iii) the aggregate amount of Finance Charge Collections deposited in the Finance Charge Subaccount pursuant to subsection 4.1(b)(i) on Deposit Dates occurring in the same -------------------- Monthly Period, exceeds the Maximum Reallocated Principal Reserves Amount for such Monthly Period, then such excess shall not be treated as Reallocated Principal 15 Reserves and shall be, first, if any other Principal Sharing Series is outstanding and in its accumulation period or amortization period, retained in the Collection 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 Seller Amount is not less than the Minimum Seller Amount and third paid to the holders of the Seller Interest. (y) Allocations During the Controlled Accumulation ---------------------------------------------- Period. During the Controlled Accumulation Period an amount ------ equal to the product of (I) the Allocation Percentage and (II) the aggregate amount of Principal Collections deposited in the Collection Account on such Deposit Date (the product for any such date is hereinafter referred to as a "Percentage ---------- Allocation") shall be allocated to the Series 2001-A ---------- Noteholders and transferred to the Principal Collections Subaccount 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 amortization period or accumulation period, transferred to the Principal Collections Subaccount 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 Seller Amount is not less than the Minimum Seller Amount and third paid to the holders of the Seller Interest. (z) Allocations During the Rapid Amortization Period ------------------------------------------------ and Class C Amortization Period. During the Rapid Amortization ------------------------------- Period, an amount equal to the product of (I) the Allocation Percentage and (II) the aggregate amount of Principal Collections deposited in the Collection Account on such Deposit Date, shall be allocated to the Series 2001-A Noteholders and transferred to the Principal Collections Subaccount until applied as provided herein; provided, -------- however, that after the date on which an amount of such ------- Collections equal to the Note Principal Balance plus any amounts owing to the Class C Noteholders under the Class C Note Purchase Agreement, any amounts owing to the Class A Counterparty under the Class A Swap and any amounts owing to the Class B Counterparty under the Class B Swap has been deposited into the Collection Account and allocated to the Series 2001-A Noteholders, such amount shall be 16 first, if any other Principal Sharing Series is outstanding and in its amortization period or accumulation period, transferred to the Principal Collections Subaccount 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 Seller Amount is not less than the Minimum Seller Amount and third paid to the holders of the Seller Interest. Section 4.2 Determination of Monthly Interest. --------------------------------- (a) The amount of monthly interest ("Class A Monthly Interest") ------------------------ distributable from the Collection Account with respect to the Class A 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 Interest Period and the denominator of which is 360, times (B) the Class A Note Interest Rate in effect with respect to the related Interest 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). On the Determination Date preceding each Distribution Date, the Servicer shall determine the excess, if any (the "Class A Interest Shortfall"), -------------------------- of (x) the Class A Monthly Interest for such Distribution Date over (y) the aggregate amount of funds allocated and available to pay such Class A Monthly Interest on such Distribution Date. If the Class A Interest Shortfall for any Distribution Date is greater than zero, on each subsequent Distribution Date until such Class A Interest Shortfall 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 Interest Period and the denominator of which is 360, times (B) the Class A Note Interest Rate in effect with respect to the related Interest Period and (ii) such Class A Interest Shortfall (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 Collection 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 Interest Period and the denominator of which is 360, times (B) the Class B Note Interest Rate in effect with respect to the related Interest 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 Balance). On the Determination Date preceding each Distribution Date, the Servicer shall determine the excess, if any (the "Class B Interest Shortfall"), -------------------------- of (x) the Class B Monthly Interest for such Distribution Date over (y) the aggregate amount of funds 17 allocated and available to pay such Class B Monthly Interest on such Distribution Date. If the Class B Interest Shortfall for any Distribution Date is greater than zero, on each subsequent Distribution Date until such Class B Interest Shortfall 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 Interest Period and the denominator of which is 360, times (B) the Class B Note Interest Rate in effect with respect to the related Interest Period and (ii) such Class B Interest Shortfall (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 Collection Account with respect to the Class C Notes on any Distribution Date shall be an amount equal to the lesser of (a) the "Class C Monthly Interest" under (and as defined in) the Class C Note Purchase Agreement payable on such Distribution Date and (b) the product of (i) (A) a fraction, the numerator of which is the actual number of days in the related Interest Period and the denominator of which is 360, times (B) the Class C Maximum Note Interest Rate in effect with respect to the related Interest 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). On the Determination Date preceding each Distribution Date, the Servicer shall determine an amount (the "Class C Interest Shortfall") equal to -------------------------- (x) the aggregate Class C Monthly Interest for such Distribution Date minus (y) the aggregate amount of funds allocated and available to pay such Class C Monthly Interest on such Distribution Date. If the Class C Interest Shortfall for any Distribution Date is greater than zero, on each subsequent Distribution Date until such Class C Interest Shortfall is fully paid, an additional amount ("Class C Additional Interest") shall be payable as provided herein with respect --------------------------- to the Class C Notes equal to the product of (i) (A) a fraction, the numerator of which is the actual number of days in the related Interest Period and the denominator of which is 360, times (B) the lesser of (I) the default rate specified in Section 2.2(g) of the Class C Note Purchase Agreement and (II) the Class C Maximum Note Interest Rate in effect with respect to the related Interest Period and (ii) such Class C Interest Shortfall (or the portion thereof which has not been paid to the Class C Noteholders (after giving effect to the application of the proceeds of any draw made on the Spread Account as provided in subsections 4.4(a)(iv) and 4.17(c) for the purpose of paying such amount with --------------------- ------- respect to such Distribution Date)). 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. (a) The amount of ---------------------------------- monthly principal ("Class A Monthly Principal") distributable from the ------------------------- Collection 18 Account with respect to the Class A Notes on each Distribution Date, beginning with the Distribution Date in the month following the month in which the Controlled Accumulation Period or, if earlier, the Rapid Amortization Period, begins, shall be equal to the least of (i) the Available Principal Collections on deposit in the Collection Account with respect to such Distribution Date, (ii) for each Distribution Date with respect to the Controlled Accumulation Period (and on or prior to the Class A Expected Principal Distribution Date), the Controlled Deposit Amount for such Distribution Date, (iii) the Class A Note Principal Balance, minus any amount already on deposit in the Principal Accumulation Account on such Distribution Date and (iv) the Collateral Amount (after taking into account any adjustments to be made pursuant to Sections 4.5 ------------ and 4.6) prior to any deposit into the Principal Accumulation Account or payment --- to Noteholders on such Distribution Date. (b) The amount of monthly principal ("Class B Monthly Principal") ------------------------- distributable from the Collection Account with respect to the Class B Notes on each Distribution Date, beginning with the first Distribution Date with respect to the Controlled Accumulation Period on which the full amount of the Class A Note Principal Balance is on deposit in the Principal Accumulation Account or has been paid to the Class A Noteholders, or, if earlier, the first Distribution Date during the Rapid Amortization Period on which the Class A Note Principal Balance is paid in full, shall be equal to the least of (i) the Available Principal Collections on deposit in the Collection Account with respect to such Distribution Date (minus the portion of Available Principal Collections applied to Class A Monthly Principal on such Distribution Date), (ii) for each Distribution Date with respect to the Controlled Accumulation Period, the Controlled Deposit Amount for such Distribution Date minus the Class A Monthly Principal for such Distribution Date, (iii) the Class B Note Principal Balance, minus the excess of (x) the amount already on deposit in the Principal Accumulation Account on such Distribution Date over (y) the Class A Note Principal Balance on such Distribution Date after taking into account any payments to the Class A Noteholders on such Distribution Date and (iv) the Collateral Amount (after taking into account any adjustments to be made pursuant to Sections 4.5 and 4.6) prior to any deposit into the Principal Accumulation ------------ --- Account or payment to Noteholders on such Distribution Date, minus the Class A Monthly Principal for such Distribution Date. (c) The amount of monthly principal ("Class C Monthly Principal") ------------------------- distributable from the Collection Account with respect to the Class C Notes on each Distribution Date beginning with the Class C Principal Commencement Date, shall be equal to the least of (i) the Available Principal Collections on deposit in the Collection Account with respect to such Distribution Date (minus the portion of Available Principal Collections applied to Class A Monthly Principal and Class B Monthly Principal on such Distribution Date), (ii) the Class C Note Principal Balance and (iii) the Collateral Amount (after taking into account any adjustments to be made pursuant to Sections 4.5 and 4.6) prior ------------ --- to any deposit into the Principal Accumulation 20 Account or payment to Noteholders on such Distribution Date, minus the Class A Monthly Principal and the Class B Monthly Principal for such Distribution Date. Section 4.4 Application of Available Finance Charge Collections and ------------------------------------------------------- Available Principal Collections. The Servicer shall apply, or shall cause the - ------------------------------- Indenture Trustee to apply by written instruction to the Indenture Trustee, on each Distribution Date, Available Finance Charge Collections and Available Principal Collections on deposit in the Collection Account with respect to such Distribution Date to make the following distributions: (a) On each Distribution Date, an amount equal to the Available Finance Charge Collections with respect to such Distribution Date will be distributed or deposited in the following priority: (i) on a pari passu basis (A) an amount equal to Class A Monthly Interest for such Distribution Date, plus the amount of any Class A Monthly Interest previously due but not distributed to Class A Noteholders on a prior Distribution Date, 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 distributed to the Paying Agent for payment to Class A Noteholders on such Distribution Date and (B) any Class A Net Swap Payment for that Distribution Date shall be distributed to the Class A Counterparty ; (ii) on a pari passu basis (A) an amount equal to Class B Monthly Interest for such Distribution Date, plus the amount of any Class B Monthly Interest previously due but not distributed to Class B Noteholders on a prior Distribution Date, 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 distributed to the Paying Agent for payment to Class B Noteholders on such Distribution Date and (B) any Class B Net Swap Payment for that Distribution Date shall be paid to the Class B Counterparty; (iii) if neither FCNB nor any of its Affiliates is the Servicer, an amount equal to the Monthly Servicing Fee for such Distribution Date, plus the amount of any Monthly Servicing Fee previously due but not distributed to the Servicer on a prior Distribution Date, shall be distributed to the Servicer; (iv) an amount equal to Class C Monthly Interest for such Distribution Date, plus the amount of any Class C Monthly Interest previously due but not distributed to the Class C Noteholders on a prior Distribution Date, 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 distributed to the Paying Agent for payment to the Class C Noteholders on such Distribution Date; provided, however, that, in -------- ------- 20 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 ------------ distributed to the Paying Agent for payment to the Class C Noteholders on such Distribution Date in accordance with this subsection ---------- 4.4(a)(iv); ---------- (v) an amount equal to the 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; (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) on each Distribution Date from and after the Reserve Account Funding Date, but prior to the date on which the Reserve Account terminates as described in 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; (viii) an amount equal to the amounts required to be deposited in the Spread Account pursuant to Section 4.17(e) shall be --------------- deposited into the Spread Account as provided in Section 4.17(e); --------------- (ix) an amount equal to any other payments owed to the Class C Noteholders under the Class C Note Purchase Agreement shall be paid to the Class C Noteholders; (x) if the Rapid Amortization Period is extended past the Distribution Date on which the Note Principal Balance is paid in full as a result of there being amounts owed to any Counterparty, on each Distribution Date after the Note Principal Balance is paid in full, on a pari passu basis (A) an amount equal to any partial or early termination payments or other additional payments owed to the Class A Counterparty under the Class A Swap shall be paid to the Class A Counterparty and (B) an amount equal to any partial or early termination payments or other additional payments owed to the Class B Counterparty under the Class B Swap shall be paid to the Class B Counterparty; (xi) any Monthly Servicing Fee for such Distribution Date or prior Distribution Dates not paid pursuant to subsection 4.4(a)(iii) ---------------------- (unless such amount has been netted against deposits to the Collection Account in accordance with Section 8.4 of the Indenture) shall be ----------- distributed to the Servicer; and 21 (xii) 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, second deposited in the Excess Funding Account to the extent necessary so that the Seller Amount is not less than the Minimum Seller Amount and third paid to the holders of the Seller Interest as described in Section 8.6 of ----------- the Indenture. (b) On each Distribution Date with respect to the Revolving Period, an amount equal to the Available Principal Collections deposited in the Collection Account for the related Monthly Period shall be treated as Shared Principal Collections and applied in accordance with Section 8.5 of the Indenture. ----------- (c) On each Distribution Date with respect to the Controlled Accumulation Period, the Class C Amortization Period or the Rapid Amortization Period, an amount equal to the Available Principal Collections deposited in the Collection Account 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 Class A Monthly Principal and the Class B Monthly Principal for such Distribution Date shall be deposited into the Principal Accumulation Account; (ii) during the Class C Amortization Period, an amount equal to the Class C Monthly Principal for such Distribution Date, if any shall be distributed to the Paying Agent for payment to the Class C Noteholders on such Distribution Date and on each subsequent Distribution Date until the Class C Note Principal Balance has been paid in full; (iii) during the Rapid Amortization Period, an amount equal to the Class A Monthly Principal for such Distribution Date shall be distributed to the Paying Agent for payment to the Class A Noteholders on such Distribution Date and on each subsequent Distribution Date until the Class A Note Principal Balance has been paid in full; (iv) after giving effect to the distribution referred to in clause (iii) above, during the Rapid Amortization Period, an amount ------------ equal to the Class B Monthly Principal, if any, shall be distributed to the Paying Agent for payment to the Class B Noteholders on such Distribution Date and on each subsequent Distribution Date until the Class B Note Principal Balance has been paid in full; (v) after giving effect to the distributions referred to in clauses (iii) and (iv) above, during the Rapid Amortization Period, an ------------- amount equal to the Class C Monthly Principal, if any, shall be distributed to the Paying Agent for payment to the Class C Noteholders on such Distribution Date and on each subsequent Distribution Date until the Class C Note Principal Balance has been paid in full; and (vi) in the case of each of the Controlled Accumulation Period, the Class C Amortization Period and the Rapid Amortization Period, the balance 22 of such Available Principal Collections remaining after application in accordance with clause (i) or (v) above shall be treated as Shared ---------- --- Principal Collections and applied in accordance with Section 8.5 of the ----------- Indenture. As of any Distribution Date on which any Available Principal Collections are treated as Shared Principal Collections as provided above, the Collateral Amount shall be reduced by an amount equal to the lesser of (x) the amount of Available Principal Collections applied as Shared Principal Collections and (y) the Surplus Collateral Amount. (d) On the earlier to occur of (i) the first Distribution Date with respect to the Rapid Amortization Period and (ii) the Class A Expected Principal Distribution Date, the Indenture Trustee, acting in accordance with instructions from the Servicer, shall withdraw from the Principal Accumulation Account and distribute to the Paying Agent for payment to the Class A Noteholders, funds in an amount equal to the lesser of (i) the amount of funds on deposit in the Principal Accumulation Account and (ii) the Class A Note Principal Balance. On the earliest to occur of (i) the first Distribution Date with respect to the Rapid Amortization Period and (ii) the Class B Expected Principal Distribution Date, the Indenture Trustee, acting in accordance with the instructions of the Servicer, shall withdraw from the Principal Accumulation Account and distribute to the Paying Agent for payment to the Class B Noteholders, funds in an amount equal to the lesser of (i) the amount of funds remaining on deposit in the Principal Accumulation Account after making any payments required by the preceding sentence and (ii) the Class B Note Principal Balance. 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. (a) On each Distribution --------------------------------- Date, the Servicer shall apply, or shall instruct the Indenture Trustee in writing to apply, Reallocated Principal Collections with respect to such Distribution Date, to fund any deficiency pursuant to and in the priority set forth in subsections 4.4(a)(i), (ii), (iii), (iv), (ix) and (x); provided that --------------------- ---- ----- ---- ---- --- -------- in no event will Reallocated Principal Collections be applied pursuant to subsections 4.4(a)(ix) and (x) until the payment in full of the Note Principal - ---------------------- --- Balance. On each Distribution Date, the Collateral Amount shall be reduced by the amount of Reallocated Principal Collections for such Distribution Date. (b) On any Deposit Date on which the sum of (a) all Reallocated Principal Reserves previously deposited in the Principal Collections Subaccount pursuant to subsection 4.1(b)(ii)(x) on Deposit Dates occurring in the same ------------------------ Monthly 23 Period, plus (b) the aggregate amount of Finance Charge Collections deposited in the Finance Charge Subaccount pursuant to subsection 4.1(b)(i) on Deposit Dates -------------------- occurring in the same Monthly Period, exceeds the Maximum Reallocated Principal Reserves Amount, then the Servicer shall allocate, or cause the Indenture Trustee to allocate, Reallocated Principal Reserves in the amount of such excess, first, if any other Principal Sharing Series is outstanding and in its accumulation period or amortization period, to be retained in the Collection Account for application, to the extent necessary, as Shared Principal Collections to other Principal Sharing Series on the related Distribution Date, second to be deposited in the Excess Funding Account to the extent necessary so that the Seller Amount is not less than the Minimum Seller Amount and third to be paid to the holders of the Seller Interest. Section 4.7 Excess Finance Charge Collections. Series 2001-A shall be --------------------------------- an Excess Allocation Series with respect to Group One only. For this purpose, each outstanding series of certificates issued by First Consumers 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 Distribution Date will be allocated to Series 2001-A 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 2001-A 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 2001-A 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 (xi) 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 8.5 of the ---------------------------- ----------- Indenture, Shared Principal Collections for any Distribution Date will be allocated to Series 2001-A in an amount equal to the product of (x) the aggregate amount of Shared Principal Collections with respect to all Principal Sharing Series for such Distribution Date and (y) a fraction, the numerator of which is the Principal Shortfall for Series 2001- A for such Distribution Date and the denominator of which is the aggregate amount of Principal Shortfalls for all the Series which are Principal Sharing Series for such Distribution Date. For this purpose, each outstanding series of certificates issued by First Consumers Master Trust (other than series represented by the Collateral Certificate) shall be deemed to be a Principal Sharing Series. The "Principal --------- Shortfall" for Series 2001-A will be equal to (a) for any Distribution Date with - --------- respect to the Revolving Period, zero, (b) for any Distribution Date with respect to the Controlled Accumulation Period, the excess, if any, of the Controlled Deposit Amount with respect to such Distribution Date over the amount of Available 24 Principal Collections for such Distribution Date (excluding any portion thereof attributable to Shared Principal Collections), and (c) for any Distribution Date with respect to the Rapid Amortization Period, the excess, if any, of the Note Principal Balance less the balance in the Principal Accumulation Account over the amount of Available Principal Collections for such Distribution Date (excluding any portion thereof attributable to Shared Principal Collections). Section 4.9 Principal Accumulation 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 Class A Noteholders and the Class B Noteholders, a non- interest bearing segregated trust account with the corporate trust department of such Eligible Institution (the "Principal Accumulation ---------------------- Account"), bearing a designation clearly indicating that the funds deposited - ------- therein are held for the benefit of the Class A Noteholders and the Class B Noteholders. The Indenture Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Principal Accumulation Account and in all proceeds thereof. The Principal Accumulation Account shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Series 2001- A Noteholders. If at any time the institution holding the Principal Accumulation Account ceases to be an Eligible Institution, the 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, establish a new Principal Accumulation Account meeting the conditions specified above with an Eligible Institution, and shall transfer any cash or any investments to such new Principal Accumulation Account. The Indenture Trustee, at the written direction of the Servicer, shall (i) make withdrawals from the Principal Accumulation Account from time to time, in the amounts and for the purposes set forth in this Indenture Supplement, and (ii) on each Distribution 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). -------------------- (b) Funds on deposit in the Principal Accumulation Account shall be invested at the written direction of the Servicer by the Indenture Trustee in Permitted Investments. Funds on deposit in the Principal Accumulation Account on any Distribution Date, after giving effect to any withdrawals from the Principal Accumulation Account on such Distribution Date, shall be invested in such investments that will mature so that such funds will be available for withdrawal on or prior to the following Distribution Date. The Indenture Trustee shall hold such of the Permitted 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 Permitted Investments as constitutes investment property through a securities intermediary, which securities intermediary 25 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 Illinois. 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 Distribution Date with respect to the Controlled Accumulation Period and on the first Distribution Date with respect to the Rapid Amortization Period, the Indenture Trustee, acting at the Servicer's written direction given on or before such Distribution Date, shall 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 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. --------------- 26 (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 2001-A Noteholders, a non-interest bearing segregated trust account with the corporate trust department of such Eligible Institution (the "Reserve Account"), bearing a --------------- designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2001-A 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 2001-A Noteholders. If at any time the institution holding the Reserve Account ceases to be an Eligible Institution, the 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, 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 written 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 Distribution 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)(vii). ---------------------- (b) Funds on deposit in the Reserve Account shall be invested at the written direction of the Servicer by the Indenture Trustee in Permitted Investments. Funds on deposit in the Reserve Account on any Distribution Date, after giving effect to any withdrawals from the Reserve Account on such Distribution Date, shall be invested in such investments that will mature so that such funds will be available for withdrawal on or prior to the following Distribution Date. The Indenture Trustee shall hold such of the Permitted 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 Permitted 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 27 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 Distribution Date, all interest and earnings (net of losses and investment expenses) accrued since the preceding Distribution 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 Collection Account and included in Available Finance Charge Collections for such Distribution 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 Distribution Date with respect to the Controlled Accumulation Period and on or before the first Distribution Date with respect to the Rapid 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)(vii) with respect to such Distribution Date. - ------------------- (d) If for any Distribution Date the Reserve Draw Amount is greater than zero, the Reserve Draw Amount, up to the Available Reserve Account Amount, shall be withdrawn from the Reserve Account on such Distribution Date by the Indenture Trustee (acting in accordance with the written instructions of the Servicer) and deposited into the Collection Account for application as Available Finance Charge Collections for such Distribution Date. (e) If the Reserve Account Surplus on any Distribution Date, after giving effect to all deposits to and withdrawals from the Reserve Account with respect to such Distribution 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 Spread Account Cap, and (ii) distribute any such amounts remaining after application pursuant to subsection 4.10(e)(i) to the holders of the Seller 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 Distribution ------------ Date relating to the Rapid Amortization Period and (iii) the Class B Expected Principal Distribution Date, the Indenture Trustee, acting in accordance with the instructions of the Servicer, after the prior payment of all amounts owing to the Series 2001-A Noteholders that are payable from the Reserve Account as provided herein, shall withdraw from the Reserve Account all amounts, if any, on deposit in the Reserve 28 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 Spread Account Cap, and (ii) distribute any such amounts remaining after application pursuant to subsection 4.10(f)(i) to the holders of the Seller 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 Swaps. (a) On or prior to the Closing Date, the Owner ----- Trustee shall, on behalf of the Issuer, enter into a Class A Swap with the Class A Counterparty and a Class B Swap with the Class B Counterparty for the benefit of the Class A Noteholders and the Class B Noteholders, respectively. The aggregate notional amount under the Class A Swap shall, at any time, be equal to the Class A Note Principal Balance at such time and the aggregate notional amount under the Class B Swap shall, at any time, be equal to the Class B Note Principal Balance at such time. Net Swap Receipts and early termination payments payable by the Class A Counterparty or the Class B Counterparty shall be deposited by the Indenture Trustee in the Collection Account on the day received and treated as Available Finance Charge Collections. On any Distribution Date when there shall be a Class A Net Swap Payment, such Class A Net Swap Payment shall be paid as provided in Section 4.4(a)(i). On any Distribution Date when ----------------- there shall be a Class B Net Swap Payment, such Class B Net Swap Payment shall be paid as provided in Section 4.4(a)(ii). On any Distribution Date when there ------------------ shall be early termination payments or any other miscellaneous payments payable by the Issuer to the Counterparties, such amounts shall be paid as provided in Section 4.4(a)(x). - ----------------- (b) The Class A Swap shall be in substantially the same form as the initial Class A Swap and Class B Swap, respectively attached hereto as Exhibits -------- D-1 and D-2. - ----------- (c) The Servicer may, upon satisfaction of the Rating Agency Condition, and, when required under the terms of the existing Class A Swap or Class B Swap, shall, obtain a replacement Class A Swap or Class B Swap, as applicable. 29 Section 4.12 Determination of LIBOR. ---------------------- (a) On each LIBOR Determination Date in respect of an Interest 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 Interest 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 Interest Period shall be the arithmetic mean of the quotations. If fewer than two (2) quotations are provided as requested, the rate for that Interest 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 Maximum Note Interest Rate applicable to the then current and the immediately preceding Interest Periods may be obtained by telephoning the Indenture Trustee at its corporate trust office at (312) 827-8500 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 2001-A 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 Interest Period. 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 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 opening of business on February 1, 2005. However, if the Accumulation Period Length (determined as described below) is less than 12 months, the Servicer may delay 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 Expected Principal 30 Distribution Date at least equal to the Accumulation Period Length and, as a result, the number of Monthly Periods in the Controlled Accumulation Period will at least equal the Accumulation Period Length. On the Determination Date immediately preceding the January 2005 Distribution Date, and each Determination Date thereafter until the Controlled Accumulation Period begins, the Servicer will determine the "Accumulation Period Length" which will equal the number of -------------------------- whole months such that the sum of the Accumulation Period Factors for each month during such period will be equal to or greater than the Required Accumulation Factor Number; provided, however, that the Accumulation Period Length will not -------- ------- be determined to be less than one month; provided further, however, that the -------- ------- ------- determination of the Accumulation Period Length may be changed at any time if the Rating Agency Condition is satisfied. Section 4.15 Suspension of Controlled Accumulation Period. (a) The -------------------------------------------- Issuer may elect to suspend the commencement of the Controlled Accumulation Period with the prior written consent of each Counterparty and with prior notice to the Rating Agencies. The commencement of the Controlled Accumulation Period shall be suspended upon delivery by the Issuer to the Indenture Trustee of (i) an Officer's Certificate stating that the Issuer 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 Class A Noteholders and the Class B 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 Class A Noteholders and the Class B 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 Class A Noteholders and the Class B Noteholders. (b) The Issuer shall cause the provider of each Qualified Maturity Agreement (i) to deposit into the Principal Accumulation Account on or before the Class A Expected Principal Distribution Date an amount equal to the Class A Note Initial Principal Balance and (ii) to deposit into the Principal Accumulation Account 31 on or before the Class B Expected Principal Distribution Date an amount equal to the Class B Note Initial 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 Distribution Date. The amount deposited with respect to the Class A Note Principal Balance and the amount deposited with respect to the Class B Note Principal Balance shall be applied on the Class A Expected Principal Distribution Date and the Class B Expected Principal Distribution Date, respectively, 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 Class B Expected Principal Distribution 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) a Pay Out 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 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 Class B Expected Principal Distribution Date and the commencement of the Rapid 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 January 2005 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. Section 4.16 Interchange. On or prior to each Determination Date, ----------- Seller shall notify the Servicer of the amount of Interchange to be included as Finance Charge Collections allocable to the Series 2001-A Notes with respect to the preceding Monthly Period, which allocation shall equal the Allocation Percentage for Finance Charge Collections for such preceding Monthly Period times the total 32 amount of Interchange for such Monthly Period. On each Transfer Date, Seller shall pay to the Servicer, and the Servicer shall deposit into the Finance Charge Subaccount, in immediately available funds, the amount of Interchange to be so included as Finance Charge Collections allocable to the Series 2001-A Notes with respect to the preceding Monthly Period. Seller hereby assigns, sets- over, conveys, pledges and grants a security interest and lien to the Indenture Trustee for the benefit of the Series 2001-A Noteholders in such Interchange and the proceeds of such Interchange, as set forth in this Section 4.16. To the ------------ extent that an indenture supplement for a Series, other than Series 2001-A, assigns, sets- over, conveys, pledges or grants a security interest in Interchange allocable to the Issuer, all Notes of any such Series (except as otherwise specified in any such Supplement) and the Series 2001-A Notes shall rank pari passu and be equally and ratably entitled as provided herein to the ---- ----- benefits of such Interchange without preference or priority on account of the actual time or times of authentication and delivery, all in accordance with the terms and provisions of this Indenture Supplement and the other related indenture supplements. Section 4.17 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 Seller, a non-interest bearing segregated account with the corporate trust department of such Eligible Institution (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 Seller. Except as otherwise provided in this Section 4.17, 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 Seller Interest. If at any time the institution holding the Spread Account ceases to be an Eligible Institution, the 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 Distribution 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 ---------- 4.17(e). - ------- (b) Funds on deposit in the Spread Account shall be invested at the written direction of the Servicer by the Indenture Trustee in Permitted Investments. Funds on deposit in the Spread Account on any Distribution Date, after giving effect 33 to any withdrawals from and deposits to the Spread Account on such Distribution Date, shall be invested in such investments that will mature so that such funds will be available for withdrawal on or prior to the following Distribution Date. The Indenture Trustee shall hold such of the Permitted 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 Permitted 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 4.17(b), the Indenture Trustee shall ------------------ not hold Permitted Investments through an agent or a nominee. On each Distribution Date (but subject to subsection 4.17(c)), the ------------------ Investment Earnings, if any, accrued since the preceding Distribution Date on funds on deposit in the Spread Account shall be paid to the holders of the Seller 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 4.17(c)), all Investment Earnings shall be deemed not to be available - ------------------ or on deposit; provided that after the maturity of the Series 2001-A 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. (c) If, on any Distribution 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, 34 Investment Earnings credited to the Spread Account, and deposit such amount in the Collection Account for payment to the Class C Noteholders in respect of interest on the Class C Notes. (d) On the earlier of Series 2001-A 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 4.17(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) If on any Distribution Date, after giving effect to all withdrawals from the Spread Account, the Available Spread Account Amount is less than the Spread Account Cap then in effect, Available Finance Charge Collections shall be deposited into the Spread Account under the circumstances set forth in subsection 4.4(a)(viii) up to the amount of the Spread Account Deficiency. - ----------------------- (f) On each Distribution Date, after giving effect to all withdrawals from and deposits to the Spread Account on such Distribution Date, the Indenture Trustee shall, at the written direction of the Servicer, (i) apply the Maximum Release Amount, if any, to pay any amounts owed to the Class C Noteholders under the Class C Note Purchase Agreement that remain unpaid after giving effect to the application of Available Finance Charge Collections pursuant to subsection 4.4(a)(ix) on such Distribution Date and (ii) after making any payments required under clause (i), release any remaining Maximum Release Amount to the holders of the Seller Interest. On the date on which the Class C Note Principal Balance has been paid in full, the Indenture Trustee, at the written direction of the Servicer, shall withdraw from the Spread Account all amounts then remaining in the Spread Account and pay such amounts to the holders of the Seller Interest. ARTICLE V Delivery of Series 2001-A Notes; Distributions; Reports to Series 2001-A Noteholders --------------------------------------------------- Section 5.1 Delivery and Payment for the Series 2001-A Notes. ------------------------------------------------ The Issuer shall execute and issue, and the Indenture Trustee shall authenticate, the Series 2001-A Notes in accordance with Section 2.3 of the ----------- Indenture. The Indenture Trustee shall deliver the Series 2001-A Notes to or upon the written order of the Trust when so authenticated. 35 Section 5.2 Distributions. ------------- (a) On each Distribution Date, the Paying Agent 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 held by the Paying Agent that are allocated and available on such Distribution Date to pay interest on the Class A Notes pursuant to this Indenture Supplement. (b) On each Distribution Date, the Paying Agent shall distribute to each Class A Noteholder of record on the related Record Date such Class A Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay principal of the Class A Notes pursuant to this Indenture Supplement. (c) On each Distribution Date, the Paying Agent 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 held by the Paying Agent that are allocated and available on such Distribution Date to pay interest on the Class B Notes pursuant to this Indenture Supplement. (d) On each Distribution Date, the Paying Agent shall distribute to each Class B Noteholder of record on the related Record Date such Class B Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay principal of the Class B Notes pursuant to this Indenture Supplement. (e) On each Distribution Date, the Paying Agent 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 held by the Paying Agent (including amounts held by the Paying Agent with respect to amounts withdrawn from the Spread Account (at the times and in the amounts specified in Section 4.11)) that are allocated and ------------- available on such Distribution Date to pay interest on the Class C Notes pursuant to this Indenture Supplement. (f) On each Distribution Date, the Paying Agent shall distribute to each Class C Noteholder of record on the related Record Date such Class C Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay principal of the Class C Notes pursuant to this Indenture Supplement. (g) 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. (h) Except as provided in Section 11.2 of the Indenture with respect to ------------ a final distribution, distributions to Series 2001-A Noteholders hereunder shall be made by (i) check mailed to each Series 2001-A Noteholder (at such Noteholder's 36 address as it appears in the Note Register), except that for any Series 2001-A 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 2001-A Note or the making of any notation thereon. Section 5.3 Reports and Statements to Series 2001-A Noteholders. --------------------------------------------------- (a) On each Distribution Date, the Paying Agent, on behalf of the Indenture Trustee, shall forward to each Series 2001-A 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, the Paying Agent and each Rating Agency a statement substantially in the form of Exhibit B prepared by the Servicer; 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 2001-A 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 Paying Agent, on behalf of 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 2001-A Noteholder, a statement prepared by the Servicer containing the information which is required to be contained in the statement to Series 2001-A 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 2001-A Noteholder, together with other information as is required to be provided by an issuer of indebtedness under the Code. Such obligation of the Paying Agent shall be deemed to have 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 2001-A Pay Out Events ---------------------------- Section 6.1 Series 2001-A Pay Out Events. If any one of the following ---------------------------- events shall occur with respect to the Series 2001-A Notes: (a) failure on the part of the Seller (i) to make any payment or deposit required to be made by the Seller by the terms of 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 covenants or agreements of the Seller set forth in the Transfer and Servicing Agreement, the Indenture or this Indenture Supplement, which failure has a material adverse effect on the Series 2001-A 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 Seller 37 by the Indenture Trustee, or to the Seller and the Indenture Trustee by any Holder of the Series 2001-A Notes; (b) any representation or warranty made by the Seller in the Transfer and Servicing Agreement or, prior to the FCMT Termination Date, the Pooling and Servicing Agreement, or any information contained in a computer file or microfiche list required to be delivered by the Seller 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 Seller by the Indenture Trustee, or to the Seller and the Indenture Trustee by any Holder of the Series 2001-A Notes and as a result of which the interests of the Series 2001-A Noteholders are materially and adversely affected for such period; provided, however, that a -------- ------- Series 2001-A Pay Out Event pursuant to this subsection 6.1(b) shall not be ----------------- deemed to have occurred hereunder if the Seller has accepted reassignment of the related Receivable, or all of such Receivables, if applicable, during such period in accordance with the provisions of the Transfer and Servicing Agreement or the Pooling and Servicing Agreement; (c) a failure by the Seller to convey Receivables in Additional Accounts to the 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 2.6(a) of the Pooling and ----------------- Servicing Agreement; (d) any Servicer Default shall occur; (e) the Portfolio Yield averaged over three consecutive Monthly Periods is less than the Base Rate averaged over such period; (f) the Class A Note Principal Balance shall not be paid in full on the Class A Expected Principal Distribution Date or the Class B Note Principal Balance shall not be paid in full on the Class B Expected Principal Distribution Date; (g) the Class A Counterparty or the Class B Counterparty shall fail to pay any net amount payable by such Counterparty under the Class A Swap or Class B Swap, as applicable, as a result of LIBOR being greater than the Class A Swap Rate or Class B Swap Rate, as applicable, and such failure is not cured within five Business Days; (h) the Class A Swap or Class B Swap shall terminate prior to the Series Termination Date and the Issuer shall fail to enter into a replacement Class A Swap or Class B Swap, as applicable, in accordance with subsection ---------- 4.11(c); - ------- (i) without limiting the foregoing, the occurrence of an Event of Default with respect to Series 2001-A and acceleration of the maturity of the Series 2001-A Notes pursuant to Section 5.3 of the Indenture; or ----------- (j) prior to the FCMT Termination Date, a Trust Pay Out Event shall occur under (and as defined in) the Pooling and Servicing Agreement; 38 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 2001-A Notes evidencing more than 50% of the aggregate unpaid principal amount of Series 2001-A Notes by notice then given in writing to the Seller and the Servicer (and to the Indenture Trustee if given by the Series 2001-A Noteholders) may declare that a "Series Pay Out Event" with respect to Series 2001-A (a "Series 2001- A Pay Out Event") has ---------------------------- occurred as of the date of such notice, and, in the case of any event described in subsection (c), (e), (f), (g), (h), (i) or (j), a Series 2001-A Pay Out Event -------------- --- --- --- --- --- --- shall occur without any notice or other action on the part of the Indenture Trustee or the Series 2001-A Noteholders immediately upon the occurrence of such event. ARTICLE VII Redemption of Series 2001-A Notes; Final Distributions; Series Termination -------------------------------------------------------------------------- Section 7.1 Optional Redemption of Series 2001-A Notes; Final ------------------------------------------------- Distributions. - ------------- (a) On any day occurring on or after the date on which the outstanding principal balance of the Series 2001-A Notes is reduced to 10% or less of the initial outstanding principal balance of Series 2001-A Notes, the Servicer shall have the option to redeem the Series 2001-A 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) The Issuer shall give the Servicer and the Indenture Trustee at least thirty (30) days prior written notice of the date on which the Issuer intends to exercise such optional redemption. Not later than 12:00 noon, New York City time, on such day the Issuer shall deposit into the Collection Account 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 2001-A shall be reduced to zero and the Series 2001-A 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 Seller with respect to Series 2001-A in connection with a reassignment of Receivables to the Seller 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. (ii) The amount to be paid by the Seller with respect to Series 2001-A 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. 39 (d) With respect to (a) the Reassignment Amount deposited into the Collection 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 2001-A, 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 deposits or distributions of the following amounts (in the priority set forth below and, in each case, after giving effect to any deposits and distributions otherwise to be made on such date) in immediately available funds: (i) (x) the Class A Note Principal Balance on such Distribution Date will be distributed to the Paying Agent for payment 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 Monthly Interest previously due but not distributed to the Class A Noteholders on a prior Distribution Date and (C) the amount of Class A Additional Interest, if any, for such Distribution Date and any Class A Additional Interest previously due but not distributed to the Class A Noteholders on any prior Distribution Date, will be distributed to the Paying Agent for payment to the Class A Noteholders, (ii) (x) the Class B Note Principal Balance on such Distribution Date will be distributed to the Paying Agent for payment 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 Monthly Interest previously due but not distributed to the Class B Noteholders on a prior 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 Paying Agent for payment to the Class B Noteholders, (iii) (x) the Class C Note Principal Balance on such Distribution Date will be distributed to the Paying Agent for payment 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 Monthly Interest previously due but not distributed to the Class C Noteholders on a prior Distribution Date, (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 and (D) any other amounts owed to the Class C Noteholders under the Class C Note Purchase Agreement, will be distributed to the Paying Agent for payment to the Class C Noteholders, (iv) on a pari passu basis, (A) any amounts owed to the Counterparty under the Class A Swap will be paid to the Class A Counterparty and (B) any amounts owed to the Class B Counterparty under the Class B Swap will be paid to the Class B Counterparty and (v) any excess shall be released to the Issuer. (e) Notwithstanding anything to the contrary in this Indenture Supplement, the Indenture or the Transfer and Servicing Agreement, all amounts distributed to the Paying Agent pursuant to subsection 7.1(d) for payment to the ----------------- Series 2001-A Noteholders shall be deemed distributed in full to the Series 2001-A Noteholders on the date on which such funds are distributed to the Paying Agent 40 pursuant to this Section 7.1 and shall be deemed to be a final distribution ----------- pursuant to Section 11.2 of the Indenture. ------------ Section 7.2 Series Termination. ------------------ On the Series 2001-A Final Maturity Date, the right of the Series 2001-A 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 2001-A Noteholders shall be the only Noteholders whose vote shall be required. Section 8.2 Form of Delivery of the Series 2001-A Notes. The Class A ------------------------------------------- Notes and the Class B 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. The ------------ ---- Class C Notes shall be Definitive Notes and shall initially be registered in the Note Register in the name of the initial purchaser of the Class C Notes identified in the Class C Note Purchase Agreement. Section 8.3 Additional Requirements for Registration of and Limitations ----------------------------------------------------------- on Transfer and Exchange of Class C Notes. The Class C Notes will be subject to - ----------------------------------------- limitations on transfer and exchange set forth in the Class C Note Purchase Agreement. Section 8.4 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 8.5 GOVERNING LAW. THIS INDENTURE SUPPLEMENT SHALL BE CONSTRUED ------------- IN ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS, PROVIDED, HOWEVER, THAT THE DUTIES AND OBLIGATIONS OF THE INDENTURE TRUSTEE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS. Section 8.6 Limitation of Liability. Notwithstanding any other ----------------------- provision herein or elsewhere, this Agreement has been executed and delivered by Bankers Trust Company, not in its individual capacity, but solely in its capacity as Owner Trustee of the Trust, in no event shall Bankers Trust Company in its individual 41 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 8.7 Rights of the Indenture Trustee. The Indenture Trustee ------------------------------- shall have herein the same rights, protections, indemnities and immunities as specified in the Master Indenture. [SIGNATURE PAGE FOLLOWS] 42 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. FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, as Issuer By: BANKERS TRUST COMPANY, not in its individual capacity, but solely as Owner Trustee By: /s/ Eileen M. Hughes ---------------------- Name: Eileen M. Hughes Title: Vice President THE BANK OF NEW YORK, as Indenture Trustee By: /s/ Greg Anderson ------------------ Name: Greg Anderson Title: Authorized Agent 43 Acknowledged and Accepted: FIRST CONSUMERS NATIONAL BANK, as Servicer and Seller By: /s/ John R. Steele -------------------- Name: John R. Steele Title: Treasurer 44 CLASS A SERIES 2001-A 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 FIRST CONSUMERS MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF ILLINOIS ("FCMT"), OR THE ISSUER, OR JOIN IN INSTITUTING AGAINST FCMT 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. 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 $____________/1/ No. R-1 CUSIP NO. ______________ FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A CLASS A SERIES 2001-A FLOATING RATE ASSET BACKED NOTE First Consumers Credit Card Master Note Trust (herein referred to as the "Issuer" or the "Trust"), an Illinois common law trust governed by a Trust Agreement dated as of March 1, 2001, for value received, hereby promises to pay to Cede & Co., or registered assigns, subject to the following provisions, the principal sum of ________________________, or such lesser amount as determined in accordance with the Indenture, on the Series 2001-A Final Maturity Date, which is the September 2008 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 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. ___________________ /1/Denominations of $1,000 and integral multiples of $1,000 in excess thereof. IN WITNESS WHEREOF, the Issuer has caused this Class A Note to be duly executed. FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, as Issuer By: Bankers Trust Company, not in its individual capacity but solely as Owner Trustee under the Trust Agreement By: ________________________________________ Name: Title: Dated: INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Class A Notes described in the within-mentioned Indenture. THE BANK OF NEW YORK, as Indenture Trustee By: __________________________________ Authorized Signatory FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A CLASS A SERIES 2001-A 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 First Consumers Credit Card Master Note Trust, Series 2001-A (the "SERIES 2001-A NOTES"), issued under a Master Indenture dated as of March 1, 2001 (the "MASTER INDENTURE"), between the Issuer and The Bank of New York, as indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the Indenture Supplement dated as of March 1, 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 Class A 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. The Class A Note Initial Principal Balance is $______________. The Class A Note Principal Balance on any date of determination will be 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. The Class A Expected Principal Distribution Date is the February 2006 Distribution Date, but principal with respect to the Class A Notes may be paid earlier or later under certain circumstances described in the Indenture. If for one or more months during the Controlled Accumulation Period there are not sufficient funds to deposit into the Principal Accumulation Account the Controlled Deposit Amount, then to the extent that excess funds are not available on subsequent Distribution Dates with respect to the Controlled Accumulation Period to make up for such shortfalls, the final payment of principal of the Class A Notes will occur later than the Class A Expected Principal Distribution Date. Payments of principal of the Notes shall be payable in accordance with the provisions of the Indenture. Subject to the terms and conditions of the Indenture, First Consumers National Bank (the "Seller") may, from time to time, direct the Owner Trustee, on behalf of the Trust, to issue one or more new Series of Notes. On each Distribution Date, the Paying Agent shall distribute to each Class A Noteholder of record on the related Record Date (except for the final payment in respect of this Class A Note) such Class A Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay interest and principal on the Class A Notes pursuant to the Indenture Supplement. Except as provided in the Indenture with respect to a final payment, payments to Series 2001-A Noteholders shall be made by (i) check mailed to each Series 2001-A Noteholder (at such Noteholder's address as it appears in the Note Register), except that with respect to any Series 2001-A Notes registered in the name of the nominee of a Clearing Agency, such payment shall be made in immediately available funds and (ii) without presentation or surrender of any Series 2001-A Note or the making of any notation thereon. Final payment of this Class A Note will be made only upon presentation and surrender of this Class A Note at the office or agency specified in the notice of final payment delivered by the Indenture Trustee to the Series 2001-A Noteholders in accordance with the Indenture. On any day occurring on or after the date on which the outstanding principal balance of the Series 2001-A Notes is reduced to 10% or less of the initial outstanding principal balance of the Series 2001-A Notes, the Servicer shall have the option to redeem the Series 2001-A 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. THIS CLASS A NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, THE ISSUER, FIRST CONSUMERS NATIONAL BANK, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY. Each Noteholder, by accepting a Note, hereby covenants and agrees that it will not at any time institute against FCMT or the Issuer, or join in instituting against the FCMT 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. Except as otherwise provided in the Indenture Supplement, the Class A Notes are issuable only in minimum denominations of $1,000 and integral multiples of $1,000. The transfer of this Class A Note shall be registered in the Note Register upon surrender of this Class A Note for registration of transfer at any office or agency maintained by the Transfer Agent and Registrar accompanied by a written instrument of transfer, in a form satisfactory to the Indenture Trustee or the Transfer Agent and Registrar, duly executed by the Class A Noteholder or such Class A Noteholder's attorney, and duly authorized in writing with such signature guaranteed, and thereupon one or more new Class A Notes in any authorized denominations of like aggregate principal amount will be issued to the designated transferee or transferees. As provided in the Indenture and subject to certain limitations therein set forth, Class A Notes are exchangeable for new Class A Notes in any authorized denominations and of like aggregate principal amount, upon surrender of such Notes to be exchanged at the office or agency of the Transfer Agent and Registrar. No service charge may be imposed for any such exchange but the Issuer or Transfer Agent and Registrar may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith. The Issuer, the Seller, the Indenture Trustee and any agent of the Issuer, the Seller 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 Seller, the Indenture Trustee nor any agent of the Issuer, the Seller 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 ILLINOIS, 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. 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:_____________ _________________________________** _______________ ** 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. CLASS B SERIES 2001-A 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 FIRST CONSUMERS MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF ILLINOIS ("FCMT"), OR THE ISSUER, OR JOIN IN INSTITUTING AGAINST FCMT 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. 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. REGISTERED $_______________*** No. R-1 CUSIP NO. ____________ FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A CLASS B SERIES 2001-A FLOATING RATE ASSET BACKED NOTE First Consumers Credit Card Master Note Trust (herein referred to as the "Issuer" or the "Trust"), an Illinois common law trust governed by a Trust Agreement dated as of March 1, 2001, for value received, hereby promises to pay to Cede & Co., or registered assigns, subject to the following provisions, the principal sum of __________________, or such lesser amount as determined in accordance with the Indenture, on the Series 2001-A Final Maturity Date, which is the September 2008 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 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. IN WITNESS WHEREOF, the Issuer has caused this Class B Note to be duly executed. FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, as Issuer By: Bankers Trust Company, not in its individual capacity but solely as Owner Trustee under the Trust Agreement By:_______________________________________________ Name: Title: Dated: INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Class B Notes described in the within-mentioned Indenture. THE BANK OF NEW YORK, as Indenture Trustee By:___________________________ Authorized Signatory FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A CLASS B SERIES 2001-A 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 First Consumers Credit Card Master Note Trust, Series 2001-A (the "SERIES 2001-A NOTES"), issued under a Master Indenture dated as of March 1, 2001 (the "MASTER INDENTURE"), between the Issuer and The Bank of New York, as indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the Indenture Supplement dated as of March 1, 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 Class B 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. The Class B Note Initial Principal Balance is $_______________. The Class B Note Principal Balance on any date of determination will be 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. The Class B Expected Principal Distribution Date is the March 2006 Distribution Date, but principal with respect to the Class B Notes May be paid earlier or later under certain circumstances described in the Indenture. If for one or more months during the Controlled Accumulation Period there are not sufficient funds to deposit into the Principal Accumulation Account the Controlled Deposit Amount, then to the extent that excess funds are not available on subsequent Distribution Dates with respect to the Controlled Accumulation Period to make up for such shortfalls, the final payment of principal of the Class B Notes will occur later than the Class B Expected Principal Distribution Date. Payments of principal of the Notes shall be payable in accordance with the provisions of the Indenture. Subject to the terms and conditions of the Indenture, First Consumers National Bank (the "Seller") may, from time to time, direct the Owner Trustee, on behalf of the Trust, to issue one or more new Series of Notes. On each Distribution Date, the Paying Agent shall distribute to each Class B Noteholder of record on the related Record Date (except for the final payment in respect of this Class B Note) such Class B Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay interest and principal on the Class B Notes pursuant to the Indenture Supplement. Except as provided in the Indenture with respect to a final payment, payments to Series 2001-A Noteholders shall be made by (i) check mailed to each Series 2001-A Noteholder (at such Noteholder's address as it appears in the Note Register), except that with respect to any Series 2001-A Notes registered in the name of the nominee of a Clearing Agency, such payment shall be made in immediately available funds and (ii) without presentation or surrender of any Series 2001-A Note or the making of any notation thereon. Final payment of this Class B Note will be made only upon presentation and surrender of this Class B Note at the office or agency specified in the notice of final payment delivered by the Indenture Trustee to the Series 2001-A Noteholders in accordance with the Indenture. On any day occurring on or after the date on which the outstanding principal balance of the Series 2001-A Notes is reduced to 10% or less of the initial outstanding principal balance of the Series 2001-A Notes, the Servicer shall have the option to redeem the Series 2001-A 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. THIS CLASS B NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, THE ISSUER, FIRST CONSUMERS NATIONAL BANK, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY. Each Noteholder, by accepting a Note, hereby covenants and agrees that it will not at any time institute against FCMT or the Issuer, or join in instituting against the FCMT 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. Except as otherwise provided in the Indenture Supplement, the Class B Notes are issuable only in minimum denominations of $1,000 and integral multiples of $1,000. The transfer of this Class B Note shall be registered in the Note Register upon surrender of this Class B Note for registration of transfer at any office or agency maintained by the Transfer Agent and Registrar accompanied by a written instrument of transfer, in a form satisfactory to the Indenture Trustee or the Transfer Agent and Registrar, duly executed by the Class B Noteholder or such Class B Noteholder's attorney, and duly authorized in writing with such signature guaranteed, and thereupon one or more new Class B Notes in any authorized denominations of like aggregate principal amount will be issued to the designated transferee or transferees. As provided in the Indenture and subject to certain limitations therein set forth, Class B Notes are exchangeable for new Class B Notes in any authorized denominations and of like aggregate principal amount, upon surrender of such Notes to be exchanged at the office or agency of the Transfer Agent and Registrar. No service charge may be imposed for any such exchange but the Issuer or Transfer Agent and Registrar may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith. The Issuer, the Seller, the Indenture Trustee and any agent of the Issuer, the Seller 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 Seller, the Indenture Trustee nor any agent of the Issuer, the Seller 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 ILLINOIS, 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. 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. CLASS C SERIES 2001-A FLOATING RATE ASSET BACKED NOTE THIS CLASS C NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). NEITHER THE NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED OR SOLD EXCEPT IN COMPLIANCE WITH THE REGISTRATION PROVISIONS OF THE SECURITIES ACT AND ANY APPLICABLE PROVISIONS OF ANY STATE BLUE SKY OR SECURITIES LAWS OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION OR QUALIFICATION PROVISIONS. THE TRANSFER OF THIS NOTE IS SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE INDENTURE SUPPLEMENT REFERRED TO HEREIN. THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST FIRST CONSUMERS MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF ILLINOIS ("FCMT"), OR THE ISSUER, OR JOIN IN INSTITUTING AGAINST FCMT 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. 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. REGISTERED $_____________***** No. R-1 FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A CLASS C SERIES 2001-A FLOATING RATE ASSET BACKED NOTE First Consumers Credit Card Master Note Trust (herein referred to as the "Issuer" or the "Trust"), an Illinois common law trust governed by a Trust Agreement dated as of March 1, 2001, for value received, hereby promises to pay to Twin Towers, Inc., or its registered assigns, subject to the following provisions, the principal sum of __________________________, or such lesser amount as determined in accordance with the Indenture, on the Series 2001-A Final Maturity Date, which is the September 2008 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 at the rate referred to in and pursuant to the provisions of the Indenture Supplement 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. 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. IN WITNESS WHEREOF, the Issuer has caused this Class C Note to be duly executed. FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, as Issuer By: Bankers Trust Company, not in its individual capacity but solely as Owner Trustee under the Trust Agreement By:_______________________________________________ Name: Title: Dated: INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION This is one of the Class C Notes described in the within-mentioned Indenture. THE BANK OF NEW YORK, as Indenture Trustee By:___________________________ Authorized Signatory FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A CLASS C SERIES 2001-A 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 First Consumers Credit Card Master Note Trust, Series 2001-A (the "SERIES 2001-A NOTES"), issued under a Master Indenture dated as of March 1, 2001 (the "MASTER INDENTURE"), between the Issuer and The Bank of New York, as indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the Indenture Supplement dated as of March 1, 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. The Class C Note Initial Principal Balance is $_________________. The Class C Note Principal Balance on any date of determination will be 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. Payments of principal of the Notes shall be payable in accordance with the provisions of the Indenture. Subject to the terms and conditions of the Indenture, First Consumers National Bank (the "Seller") may, from time to time, direct the Owner Trustee, on behalf of the Trust, to issue one or more new Series of Notes. On each Distribution Date, the Paying Agent shall distribute to each Class C Noteholder of record on the related Record Date (except for the final payment in respect of this Class C Note) such Class C Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay interest and principal on the Class C Notes pursuant to the Indenture Supplement. Except as provided in the Indenture with respect to a final payment, payments to Series 2001-A Noteholders shall be made by (i) check mailed to each Series 2001-A Noteholder (at such Noteholder's address as it appears in the Note Register), and (ii) without presentation or surrender of any Series 2001-A Note or the making of any notation thereon. Final payment of this Class C Note will be made only upon presentation and surrender of this Class C Note at the office or agency specified in the notice of final payment delivered by the Indenture Trustee to the Series 2001-A Noteholders in accordance with the Indenture. On any day occurring on or after the date on which the outstanding principal balance of the Series 2001-A Notes is reduced to 10% or less of the initial outstanding principal balance of the Series 2001-A Notes, the Servicer shall have the option to redeem the Series 2001-A 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. THIS CLASS C NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, THE ISSUER, FIRST CONSUMERS NATIONAL BANK, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY. Each Noteholder, by accepting a Note, hereby covenants and agrees that it will not at any time institute against FCMT or the Issuer, or join in instituting against the FCMT 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. Except as otherwise provided in the Indenture Supplement, the Class C Notes are issuable only in minimum denominations of $ 1,000 and integral multiples of $1,000. The transfer of this Class C Note shall be registered in the Note Register upon surrender of this Class C Note for registration of transfer at any office or agency maintained by the Transfer Agent and Registrar accompanied by a written instrument of transfer, in a form satisfactory to the Indenture Trustee or the Transfer Agent and Registrar, duly executed by the Class C Noteholder or such Class C Noteholder's attorney, and duly authorized in writing with such signature guaranteed, and thereupon one or more new Class C Notes in any authorized denominations of like aggregate principal amount will be issued to the designated transferee or transferees. As provided in the Indenture and subject to certain limitations therein set forth, Class C Notes are exchangeable for new Class C Notes in any authorized denominations and of like aggregate principal amount, upon surrender of such Notes to be exchanged at the office or agency of the Transfer Agent and Registrar. No service charge may be imposed for any such exchange but the Issuer or Transfer Agent and Registrar may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection therewith. The Class C Notes may not be purchased or held with plan assets of any kind. The Issuer, the Seller, the Indenture Trustee and any agent of the Issuer, the Seller 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 Seller, the Indenture Trustee nor any agent of the Issuer, the Seller 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 ILLINOIS, 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. 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 B FORM OF MONTHLY PAYMENT INSTRUCTIONS AND NOTIFICATION TO INDENTURE TRUSTEE FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A The undersigned, a duly authorized representative of First Consumers National Bank ("FCNB"), as Servicer pursuant to the Transfer and Servicing ---- Agreement, dated as of March 1, 2001 (the "Transfer and Servicing Agreement") -------------------------------- between FCNB and First Consumers Credit Card Master Note Trust, as 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 March 1, 2001 (the "Indenture") between the Issuer and The Bank of New York, as indenture ---------- trustee (the "Indenture Trustee") as supplemented by the Series 2001-A ----------------- Indenture Supplement dated as of March 1, 2001 between the Issuer and Indenture Trustee (as amended and supplemented, the "Indenture --------- Supplement"). B. FCNB is the Servicer. C. The undersigned is a Servicing Officer. 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 Collection Account 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................... $______________ Net Swap Payment..................................... $______________ 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): ---------------------------------- Monthly Servicing Fee for such Distribution Date, plus the amount of any Monthly Servicing Fee previously due but not distributed to the Servicer on a prior Distribution Date................ $______________ D. Pursuant 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................... $______________ E. Pursuant to Subsection 4.4(a)(v): -------------------------------- 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): ---------------------------------- Amount to be deposited into the Reserve Account...... $______________ H. Pursuant to Subsection 4.4(a)(viii): ----------------------------------- Amount to be deposited in the Spread Account......... $______________ I. Pursuant to Subsection 4.4(a)(ix): --------------------------------- Amount of Noteholder Servicing Fee not paid pursuant to Section ------- 4.4(a)(iii).......................................... $______________ ----------- 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 Seller Amount is not less than the Minimum Seller Amount and third paid to the Holders of the Seller 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 Collection 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 4.4(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.............................................. $______________ C. Pursuant to Subsection 4.4(c)(ii): --------------------------------- (1) During the Rapid Amortization Period, Monthly Principal for such Distribution Date to be distributed to the Paying Agent for payment to the Class A Noteholders on such Distribution Date until the Note Principal Balance has been paid in full.............. $______________ (2) Amount remaining after giving effect to clause (1) above to be treated as Shared Principal Collections and applied in accordance with Section 8.5 of the Indenture......................... $______________ ----------- Pursuant to Section 4.6, the Servicer does hereby instruct the Indenture Trustee (i) to make a withdrawal from the Collection 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: A. Reallocated Principal Collections to fund any deficiency pursuant to and in the priority set forth in subsections 4.4(a)(i), (ii), (iii) --------------------- ---- ----- and (iv) of the Indenture Supplement................. $______________ ---- 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 4.11, 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............................................... $______________ 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): ----------------------------- Class A Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay interest on the Class A Notes pursuant to the Indenture Supplement ............................................................... $______________ B. Pursuant to Subsection 5.2(b): ----------------------------- Class A Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay principal of the Class A Notes pursuant to the Indenture Supplement ............................................................... $______________ C. Pursuant to Subsection 5.2(c): ----------------------------- Class B Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay interest on the Class B Notes pursuant to the Indenture Supplement ............................................................... $______________ D. Pursuant to Subsection 5.2(d): ----------------------------- Class B Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay principal of the Class B Notes pursuant to the Indenture Supplement ............................................................... $______________ E. Pursuant to Subsection 5.2(e): ----------------------------- Class C Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay interest of the Class C Notes pursuant to the Indenture Supplement, including amounts held by the Paying Agent with respect to amounts withdrawn from the Spread Account ............................................................... $______________ F. Pursuant to Subsection 5.2(f): ----------------------------- Class C Noteholder's pro rata share of the amounts held by the Paying Agent that are allocated and available on such Distribution Date to pay principal on the Class C Notes pursuant to the Indenture Supplement ............................................................... $______________ IN WITNESS WHEREOF, the undersigned has duly executed this certificate this ___________day of________________, 200__. FIRST CONSUMERS NATIONAL BANK, as Servicer By: ___________________________________ Name: Title: EXHIBIT C FORM OF MONTHLY NOTEHOLDERS' STATEMENT FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST SERIES 2001-A Pursuant to the Master Indenture, dated as of March 1, 2001 (as amended and supplemented, the "Indenture") between First Consumers Credit Card Master Note --------- Trust (the "Issuer") and The Bank of New York, as indenture trustee (the ------ "Indenture Trustee"), as supplemented by the Series 2001-A Indenture Supplement - ------------------ (the "Indenture Supplement"), dated as of March 1, 2001, between the Issuer and -------------------- the Indenture Trustee, First Consumers National Bank, as Servicer (the "Servicer") under the Transfer and Servicing Agreement, dated as of March 1, -------- 2001 (the "Transfer and Servicing Agreement") between the Servicer and the -------------------------------- Issuer is required to prepare certain information each month regarding current distributions to the Series 2001-A 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 Class A Notes 1. The total amount of the distribution in respect of Class A Notes....................... $________________ 2. The amount of the distribution set forth in paragraph 1 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....................... $________________ 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: $____________ End of the Month Total Receivables: $____________ Excess Funding Account Balance: $____________ Aggregate Principal Balance: $____________ Minimum Aggregate Principal Balance: $____________ End of the Month Seller Amount: $____________ Minimum Seller 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 2001-A INFORMATION INVESTOR PERCENTAGE ____________% AVAILABLE FINANCE CHARGE COLLECTIONS $____________ INVESTOR DEFAULT AMOUNT $____________ INVESTOR UNCOVERED DILUTION AMOUNT $____________ MONTHLY SERVICING FEES $____________ AVAILABLE PRINCIPAL COLLECTIONS $____________ EXCESS FINANCE CHARGE COLLECTIONS $____________ SHARED PRINCIPAL COLLECTIONS $____________ RESERVE ACCOUNT BALANCE $____________ SPREAD ACCOUNT BALANCE $____________ APPLICATION OF COLLECTIONS - CLASS A MONTHLY INTEREST $____________ CLASS B MONTHLY INTEREST $____________ CLASS C MONTHLY INTEREST $____________ NET SWAP PAYMENT $____________ MONTHLY SERVICING INTEREST $____________ INVESTOR DEFAULT AMOUNT $____________ INVESTOR UNCOVERED DILUTION AMOUNT $____________ INVESTOR CHARGE OFFS AND REALLOCATED PRINCIPAL COLLECTIONS NOT PREVIOUSLY REIMBURSED $____________ 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 ALLOCATION 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 ____________% PRINCIPAL COLLECTIONS - MONTHLY PRINCIPAL ____________% PRINCIPAL ACCUMULATION ACCOUNT BALANCE $____________ SERIES 2001-A 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 Paying Agent By:_______________________________________ Name: Title: (Multicurrency--Cross Border) ISDA (R) 1992 International Swap Dealers Association, Inc. MASTER AGREEMENT dated as of------------------------- DEUTSCHE BANK AG, NEW YORK and FIRST CONSUMERS CREDIT CARD BRANCH MASTER NOTE TRUST - --------------------------------- ---------------------------------------- have entered and/or anticipate entering into one or more transactions (each a "Transaction") that are or will be governed by this Master Agreement, which includes the schedule (the "Schedule"), and the documents and other confirming evidence (each a "Confirmation") exchanged between the parties confirming those Transactions. Accordingly, the parties agree as follows:-- 1. Interpretation (a) Definitions. The terms defined in Section 14 and in the Schedule will have the meanings therein specified for the purpose of this Master Agreement. (b) Inconsistency. In the event of any inconsistency between the provisions of the Schedule and the other provisions of this Master Agreement, the Schedule will prevail. In the event of any inconsistency between the provisions of any Confirmation and this Master Agreement (including the Schedule), such Confirmation will prevail for the purpose of the relevant Transaction. (c) Single Agreement. All Transactions are entered into in reliance on the fact that this Master Agreement and all Confirmations form a single agreement between the parties (collectively referred to as this "Agreement"), and the parties would not otherwise enter into any Transactions. 2. Obligations (a) General Conditions. (i) Each party will make each payment or delivery specified in each Confirmation to be made by it, subject to the other provisions of this Agreement. (ii) Payments under this Agreement will be made on the due date for value on that date in the place of the account specified in the relevant Confirmation or otherwise pursuant to this Agreement, in freely transferable funds and in the manner customary for payments in the required currency. Where settlement is by delivery (that is, other than by payment), such delivery will be made for receipt on the due date in the manner customary for the relevant obligation unless otherwise specified in the relevant Confirmation or elsewhere in this Agreement. (iii) Each obligation of each party under Section 2(a)(i) is subject to (1) the condition precedent that no Event of Default or Potential Event of Default with respect to the other party has occurred and is continuing, (2) the condition precedent that no Early Termination Date in respect of the relevant Transaction has occurred or been effectively designated and (3) each other applicable condition precedent specified in this Agreement. Copyright(C)1992 by International Swap Dealers Association, Inc. (b) Change of Account. Either party may change its account for receiving a payment or delivery by giving notice to the other party at least five Local Business Days prior to the scheduled date for the payment or delivery to which such change applies unless such other party gives timely notice of a reasonable objection to such change. (c) Netting. If on any date amounts would otherwise be payable:-- (i) in the same currency; and (ii) in respect of the same Transaction, by each party to the other, then, on such date, each party's obligation to make payment of any such amount will be automatically satisfied and discharged and, if the aggregate amount that would otherwise have been payable by one party exceeds the aggregate amount that would otherwise have been payable by the other party, replaced by an obligation upon the party by whom the larger aggregate amount would have been payable to pay to the other party the excess of the larger aggregate amount over the smaller aggregate amount. The parties may elect in respect of two or more Transactions that a net amount will be determined in respect of all amounts payable on the same date in the same currency in respect of such Transactions, regardless of whether such amounts are payable in respect of the same Transaction. The election may be made in the Schedule or a Confirmation by specifying that subparagraph (ii) above will not apply to the Transactions identified as being subject to the election, together with the starting date (in which case subparagraph (ii) above will not, or will cease to, apply to such Transactions from such date). This election may be made separately for different groups of Transactions and will apply separately to each pairing of Offices through which the parties make and receive payments or deliveries. (d) Deduction or Withholding for Tax. (i) Gross-Up. All payments under this Agreement will be made without any deduction or withholding for or on account of any Tax unless such deduction or withholding is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, then in effect. If a party is so required to deduct or withhold, then that party ("X") will:-- (1) promptly notify the other party ("Y") of such requirement; (2) pay to the relevant authorities the full amount required to be deducted or withheld (including the full amount required to be deducted or withheld from any additional amount paid by X to Y under this Section 2(d)) promptly upon the earlier of determining that such deduction or withholding is required or receiving notice that such amount has been assessed against Y; (3) promptly forward to Y an official receipt (or a certified copy), or other documentation reasonably acceptable to Y, evidencing such payment to such authorities; and (4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which Y is otherwise entitled under this Agreement, such additional amount as is necessary to ensure that the net amount actually received by Y (free and clear of Indemnifiable Taxes, whether assessed against X or Y) will equal the full amount Y would have received had no such deduction or withholding been required. However, X will not be required to pay any additional amount to Y to the extent that it would not be required to be paid but for:-- (A) the failure by Y to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d); or (B) the failure of a representation made by Y pursuant to Section 3(f) to be accurate and true unless such failure would not have occurred but for (I) any action taken by a taxing authority, or brought in a court of competent jurisdiction, on or after the date on which a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to this Agreement) or (II) a Change in Tax Law. 2 (ii) Liability. If:-- (1) X is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, to make any deduction or withholding in respect of which X would not be required to pay an additional amount to Y under Section 2(d)(i)(4); (2) X does not so deduct or withhold; and (3) a liability resulting from such Tax is assessed directly against X, then, except to the extent Y has satisfied or then satisfies the liability resulting from such Tax, Y will promptly pay to X the amount of such liability (including any related liability for interest, but including any related liability for penalties only if Y has failed to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)). (e) Default Interest; Other Amounts. Prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party that defaults in the performance of any payment obligation will, to the extent permitted by law and subject to Section 6(c), be required to pay interest (before as well as after judgment) on the overdue amount to the other party on demand in the same currency as such overdue amount, for the period from (and including) the original due date for payment to (but excluding) the date of actual payment, at the Default Rate. Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed. If, prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party defaults in the performance of any obligation required to be settled by delivery, it will compensate the other party on demand if and to the extent provided for in the relevant Confirmation or elsewhere in this Agreement. 3. Representations Each party represents to the other party (which representations will be deemed to be repeated by each party on each date on which a Transaction is entered into and, in the case of the representations in Section 3(f), at all times until the termination of this Agreement) that:-- (a) Basic Representations. (i) Status. It is duly organised and validly existing under the laws of the jurisdiction of its organisation or incorporation and, if relevant under such laws, in good standing; (ii) Powers. It has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform its obligations under this Agreement and any obligations it has under any Credit Support Document to which it is a party and has taken all necessary action to authorise such execution, delivery and performance; (iii) No Violation or Conflict. Such execution, delivery and performance do not violate or conflict with any law applicable to it, any provision of its constitutional documents, any order or judgment of any court or other agency of government applicable to it or any of its assets or any contractual restriction binding on or affecting it or any of its assets; (iv) Consents. All governmental and other consents that are required to have been obtained by it with respect to this Agreement or any Credit Support Document to which it is a party have been obtained and are in full force and effect and all conditions of any such consents have been complied with; and (v) Obligations Binding. Its obligations under this Agreement and any Credit Support Document to which it is a party constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganisation, insolvency, moratorium or similar laws affecting creditors' rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)). 3 (b) Absence of Certain Events. No Event of Default or Potential Event of Default or, to its knowledge, Termination Event with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement or any Credit Support Document to which it is a party. (c) Absence of Litigation. There is not pending or, to its knowledge, threatened against it or any of its Affiliates any action, suit or proceeding at law or in equity or before any court, tribunal, governmental body, agency or official or any arbitrator that is likely to affect the legality, validity or enforceability against it of this Agreement or any Credit Support Document to which it is a party or its ability to perform its obligations under this Agreement or such Credit Support Document. (d) Accuracy of Specified Information. All applicable information that is furnished in writing by or on behalf of it to the other party and is identified for the purpose of this Section 3(d) in the Schedule is, as of the date of the information, true, accurate and complete in every material respect. (e) Payer Tax Representation. Each representation specified in the Schedule as being made by it for the purpose of this Section 3(e) is accurate and true. (f) Payee Tax Representations. Each representation specified in the Schedule as being made by it for the purpose of this Section 3(f) is accurate and true. 4. Agreements Each party agrees with the other that, so long as either party has or may have any obligation under this Agreement or under any Credit Support Document to which it is a party:-- (a) Furnish Specified Information. It will deliver to the other party or, in certain cases under subparagraph (iii) below, to such government or taxing authority as the other party reasonably directs:-- (i) any forms, documents or certificates relating to taxation specified in the Schedule or any Confirmation; (ii) any other documents specified in the Schedule or any Confirmation; and (iii) upon reasonable demand by such other party, any form or document that may be required or reasonably requested in writing in order to allow such other party or its Credit Support Provider to make a payment under this Agreement or any applicable Credit Support Document without any deduction or withholding for or on account of any Tax or with such deduction or withholding at a reduced rate (so long as the completion, execution or submission of such form or document would not materially prejudice the legal or commercial position of the party in receipt of such demand), with any such form or document to be accurate and completed in a manner reasonably satisfactory to such other party and to be executed and to be delivered with any reasonably required certification, in each case by the date specified in the Schedule or such Confirmation or, if none is specified, as soon as reasonably practicable. (b) Maintain Authorisations. It will use all reasonable efforts to maintain in full force and effect all consents of any governmental or other authority that are required to be obtained by it with respect to this Agreement or any Credit Support Document to which it is a party and will use all reasonable efforts to obtain any that may become necessary in the future. (c) Comply with Laws. It will comply in all material respects with all applicable laws and orders to which it may be subject if failure so to comply would materially impair its ability to perform its obligations under this Agreement or any Credit Support Document to which it is a party. (d) Tax Agreement. It will give notice of any failure of a representation made by it under Section 3(f) to be accurate and true promptly upon learning of such failure. (e) Payment of Stamp Tax. Subject to Section 11, it will pay any Stamp Tax levied or imposed upon it or in respect of its execution or performance of this Agreement by a jurisdiction in which it is incorporated, 4 organised, managed and controlled, or considered to have its seat, or in which a branch or office through which it is acting for the purpose of this Agreement is located ("Stamp Tax Jurisdiction") and will indemnify the other party against any Stamp Tax levied or imposed upon the other party or in respect of the other party's execution or performance of this Agreement by any such Stamp Tax Jurisdiction which is not also a Stamp Tax Jurisdiction with respect to the other party. 5. Events of Default and Termination Events (a) Events of Default. The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any of the following events constitutes an event of default (an "Event of Default") with respect to such party:-- (i) Failure to Pay or Deliver. Failure by the party to make, when due, any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) required to be made by it if such failure is not remedied on or before the third Local Business Day after notice of such failure is given to the party; (ii) Breach of Agreement. Failure by the party to comply with or perform any agreement or obligation (other than an obligation to make any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) or to give notice of a Termination Event or any agreement or obligation under Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by the party in accordance with this Agreement if such failure is not remedied on or before the thirtieth day after notice of such failure is given to the party; (iii) Credit Support Default. (1) Failure by the party or any Credit Support Provider of such party to comply with or perform any agreement or obligation to be complied with or performed by it in accordance with any Credit Support Document if such failure is continuing after any applicable grace period has elapsed; (2) the expiration or termination of such Credit Support Document or the failing or ceasing of such Credit Support Document to be in full force and effect for the purpose of this Agreement (in either case other than in accordance with its terms) prior to the satisfaction of all obligations of such party under each Transaction to which such Credit Support Document relates without the written consent of the other party; or (3) the party or such Credit Support Provider disaffirms, disclaims, repudiates or rejects, in whole or in part, or challenges the validity of, such Credit Support Document; (iv) Misrepresentation. A representation (other than a representation under Section 3(e) or (f)) made or repeated or deemed to have been made or repeated by the party or any Credit Support Provider of such party in this Agreement or any Credit Support Document proves to have been incorrect or misleading in any material respect when made or repeated or deemed to have been made or repeated; (v) Default under Specified Transaction. The party, any Credit Support Provider of such party or any applicable Specified Entity of such party (1) defaults under a Specified Transaction and, after giving effect to any applicable notice requirement or grace period, there occurs a liquidation of, an acceleration of obligations under, or an early termination of, that Specified Transaction, (2) defaults, after giving effect to any applicable notice requirement or grace period, in making any payment or delivery due on the last payment, delivery or exchange date of, or any payment on early termination of, a Specified Transaction (or such default continues for at least three Local Business Days if there is no applicable notice requirement or grace period) or (3) disaffirms, disclaims, repudiates or rejects, in whole or in part, a Specified Transaction (or such action is taken by any person or entity appointed or empowered to operate it or act on its behalf); (vi) Cross Default. If "Cross Default" is specified in the Schedule as applying to the party, the occurrence or existence of (1) a default, event of default or other similar condition or event (however 5 described) in respect of such party, any Credit Support Provider of such party or any applicable Specified Entity of such party under one or more agreements or instruments relating to Specified Indebtedness of any of them (individually or collectively) in an aggregate amount of not less than the applicable Threshold Amount (as specified in the Schedule) which has resulted in such Specified Indebtedness becoming, or becoming capable at such time of being declared, due and payable under such agreements or instruments, before it would otherwise have been due and payable or (2) a default by such party, such Credit Support Provider or such Specified Entity (individually or collectively) in making one or more payments on the due date thereof in an aggregate amount of not less than the applicable Threshold Amount under such agreements or instruments (after giving effect to any applicable notice requirement or grace period); (vii) Bankruptcy. The party, any Credit Support Provider of such party or any applicable Specified Entity of such party:-- (1) is dissolved (other than pursuant to a consolidation, amalgamation or merger); (2) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (3) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (4) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors' rights, or a petition is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (A) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (B) is not dismissed, discharged, stayed or restrained in each case within 30 days of the institution or presentation thereof; (5) has a resolution passed for its winding- up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (6) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee, custodian or other similar official for it or for all or substantially all its assets; (7) has a secured party take possession of all or substantially all its assets or has a distress, execution, attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 30 days thereafter; (8) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (1) to (7) (inclusive); or (9) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts; or (viii) Merger Without Assumption. The party or any Credit Support Provider of such party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and, at the time of such consolidation, amalgamation, merger or transfer:-- (1) the resulting, surviving or transferee entity fails to assume all the obligations of such party or such Credit Support Provider under this Agreement or any Credit Support Document to which it or its predecessor was a party by operation of law or pursuant to an agreement reasonably satisfactory to the other party to this Agreement; or (2) the benefits of any Credit Support Document fail to extend (without the consent of the other party) to the performance by such resulting, surviving or transferee entity of its obligations under this Agreement. (b) Termination Events. The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any event specified below constitutes an Illegality if the event is specified in (i) below, a Tax Event if the event is specified in (ii) below or a Tax Event upon Merger if the event is specified in (iii) below, and, if specified to be applicable, a Credit Event 6 Upon Merger if the event is specified pursuant to (iv) below or an Additional Termination Event if the event is specified pursuant to (v) below:-- (i) Illegality. Due to the adoption of, or any change in, any applicable law after the date on which a Transaction is entered into, or due to the promulgation of, or any change in, the interpretation by any court, tribunal or regulatory authority with competent jurisdiction of any applicable law after such date, it becomes unlawful (other than as a result of a breach by the party of Section 4(b)) for such party (which will be the Affected Party):-- (1) to perform any absolute or contingent obligation to make a payment or delivery or to receive a payment or delivery in respect of such Transaction or to comply with any other material provision of this Agreement relating to such Transaction; or (2) to perform, or for any Credit Support Provider of such party to perform, any contingent or other obligation which the party (or such Credit Support Provider) has under any Credit Support Document relating to such Transaction; (ii) Tax Event. Due to (x) any action taken by a taxing authority, or brought in a court of competent jurisdiction, on or after the date on which a Transaction is entered into (regardless of whether such action is taken or brought with respect to a party to this Agreement) or (y) a Change in Tax Law, the party (which will be the Affected Party) will, or there is a substantial likelihood that it will, on the next succeeding Scheduled Payment Date (1) be required to pay to the other party an additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an amount is required to be deducted or withheld for or on account of a Tax (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) and no additional amount is required to be paid in respect of such Tax under Section 2(d)(i)(4) (other than by reason of Section 2(d)(i)(4)(A) or (B)); (iii) Tax Event Upon Merger. The party (the "Burdened Party") on the next succeeding Scheduled Payment Date will either (1) be required to pay an additional amount in respect of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an amount has been deducted or withheld for or on account of any Indemnifiable Tax in respect of which the other party is not required to pay an additional amount (other than by reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of a party consolidating or amalgamating with, or merging with or into, or transferring all or substantially all its assets to, another entity (which will be the Affected Party) where such action does not constitute an event described in Section 5(a)(viii); (iv) Credit Event Upon Merger. If "Credit Event Upon Merger" is specified in the Schedule as applying to the party, such party ("X"), any Credit Support Provider of X or any applicable Specified Entity of X consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and such action does not constitute an event described in Section 5(a)(viii) but the creditworthiness of the resulting, surviving or transferee entity is materially weaker than that of X, such Credit Support Provider or such Specified Entity, as the case may be, immediately prior to such action (and, in such event, X or its successor or transferee, as appropriate, will be the Affected Party); or (v) Additional Termination Event. If any "Additional Termination Event" is specified in the Schedule or any Confirmation as applying, the occurrence of such event (and, in such event, the Affected Party or Affected Parties shall be as specified for such Additional Termination Event in the Schedule or such Confirmation). (c) Event of Default and Illegality. If an event or circumstance which would otherwise constitute or give rise to an Event of Default also constitutes an Illegality, it will be treated as an Illegality and will not constitute an Event of Default. 7 6. Early Termination (a) Right to Terminate Following Event of Default. If at any time an Event of Default with respect to a party (the "Defaulting Party") has occurred and is then continuing, the other party (the "Non-defaulting Party") may, by not more than 20 days notice to the Defaulting Party specifying the relevant Event of Default, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all outstanding Transactions. If, however, "Automatic Early Termination" is specified in the Schedule as applying to a party, then an Early Termination Date in respect of all outstanding Transactions will occur immediately upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(l), (3), (5), (6) or, to the extent analogous thereto, (8), and as of the time immediately preceding the institution of the relevant proceeding or the presentation of the relevant petition upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(4) or, to the extent analogous thereto, (8). (b) Right to Terminate Following Termination Event. (i) Notice. If a Termination Event occurs, an Affected Party will, promptly upon becoming aware of it, notify the other party, specifying the nature of that Termination Event and each Affected Transaction and will also give such other information about that Termination Event as the other party may reasonably require. (ii) Transfer to Avoid Termination Event. If either an Illegality under Section 5(b)(i)(l) or a Tax Event occurs and there is only one Affected Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the Affected Party, the Affected Party will, as a condition to its right to designate an Early Termination Date under Section 6(b)(iv), use all reasonable efforts (which will not require such party to incur a loss, excluding immaterial, incidental expenses) to transfer within 20 days after it gives notice under Section 6(b)(i) all its rights and obligations under this Agreement in respect of the Affected Transactions to another of its Offices or Affiliates so that such Termination Event ceases to exist. If the Affected Party is not able to make such a transfer it will give notice to the other party to that effect within such 20 day period, whereupon the other party may effect such a transfer within 30 days after notice is given under Section 6(b)(i). Any such transfer by a party under this Section 6(b)(ii) will be subject to and conditional upon the prior written consent of the other party, which consent will not be withheld if such other party's policies in effect at such time would permit it to enter into transactions with the transferee on the terms proposed. (iii) Two Affected Parties. If an Illegality under Section 5(b)(i)(1) or a Tax Event occurs and there are two Affected Parties, each party will use all reasonable efforts to reach agreement within 30 days after notice thereof is given under Section 6(b)(i) on action to avoid that Termination Event. (iv) Right to Terminate. If:-- (1) a transfer under Section 6(b)(ii) or an agreement under Section 6(b)(iii), as the case may be, has not been effected with respect to all Affected Transactions within 30 days after an Affected Party gives notice under Section 6(b)(i); or (2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger or an Additional Termination Event occurs, or a Tax Event Upon Merger occurs and the Burdened Party is not the Affected Party, either party in the case of an Illegality, the Burdened Party in the case of a Tax Event Upon Merger, any Affected Party in the case of a Tax Event or an Additional Termination Event if there is more than one Affected Party, or the party which is not the Affected Party in the case of a Credit Event Upon Merger or an Additional Termination Event if there is only one Affected Party may, by not more than 20 days notice to the other party and provided that the relevant Termination Event is then 8 continuing, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all Affected Transactions. (c) Effect of Designation. (i) If notice designating an Early Termination Date is given under Section 6(a) or (b), the Early Termination Date will occur on the date so designated, whether or not the relevant Event of Default or Termination Event is then continuing. (ii) Upon the occurrence or effective designation of an Early Termination Date, no further payments or deliveries under Section 2(a)(i) or 2(e) in respect of the Terminated Transactions will be required to be made, but without prejudice to the other provisions of this Agreement. The amount if any, payable in respect of an Early Termination Date shall be determined pursuant to Section 6(e). (d) Calculations. (i) Statement. On or as soon as reasonably practicable following the occurrence of an Early Termination Date, each party will make the calculations on its part, if any, contemplated by Section 6(e) and will provide to the other party a statement (1) showing, in reasonable detail, such calculations (including all relevant quotations and specifying any amount payable under Section 6(e)) and (2) giving details of the relevant account to which any amount payable to it is to be paid. In the absence of written confirmation from the source of a quotation obtained in determining a Market Quotation, the records of the party obtaining such quotation will be conclusive evidence of the existence and accuracy of such quotation. (ii) Payment Date. An amount calculated as being due in respect of any Early Termination Date under Section 6(e) will be payable on the day that notice of the amount payable is effective (in the case of an Early Termination Date which is designated or occurs as a result of an Event of Default) and on the day which is two Local Business Days after the day on which notice of the amount payable is effective (in the case of an Early Termination Date which is designated as a result of a Termination Event). Such amount will be paid together with (to the extent permitted under applicable law) interest thereon (before as well as after judgment) in the Termination Currency, from (and including) the relevant Early Termination Date to (but excluding) the date such amount is paid, at the Applicable Rate. Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed. (e) Payments on Early Termination. If an Early Termination Date occurs. the following provisions shall apply based on the parties' election in the Schedule of a payment measure, either "Market Quotation" or "Loss", and a payment method, either the "First Method" or the "Second Method". If the parties fail to designate a payment measure or payment method in the Schedule, it will be deemed that "Market Quotation" or the "Second Method", as the case may be, shall apply. The amount, if any, payable in respect of an Early Termination Date and determined pursuant to this Section will be subject to any Set-off. (i) Events of Default. If the Early Termination Date results from an Event of Default:-- (1) First Method and Market Quotation. If the First Method and Market Quotation apply, the Defaulting Party will pay to the Non-defaulting Party the excess, if a positive number, of (A) the sum of the Settlement Amount (determined by the Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the Non-defaulting Party over (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party. (2) First Method and Loss. If the First Method and Loss apply, the Defaulting Party will pay to the Non-defaulting Party, if a positive number, the Non-defaulting Party's Loss in respect of this Agreement. (3) Second Method and Market Quotation. If the Second Method and Market Quotation apply, an amount will be payable equal to (A) the sum of the Settlement Amount (determined by the 9 Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the Non- defaulting Party less (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party. (4) Second Method and Loss. If the Second Method and Loss apply, an amount will be payable equal to the Non-defaulting Party's Loss in respect of this Agreement. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party. (ii) Termination Events. If the Early Termination Date results from a Termination Event:-- (1) One Affected Party. If there is one Affected Party, the amount payable will be determined in accordance with Section 6(e)(i)(3), if Market Quotation applies, or Section 6(e)(i)(4), if Loss applies, except that, in either case, references to the Defaulting Party and to the Non-defaulting Party will be deemed to be references to the Affected Party and the party which is not the Affected Party, respectively, and, if Loss applies and fewer than all the Transactions are being terminated, Loss shall be calculated in respect of all Terminated Transactions. (2) Two Affected Parties. If there are two Affected Parties:-- (A) if Market Quotation applies, each party will determine a Settlement Amount in respect of the Terminated Transactions, and an amount will be payable equal to (I) the sum of (a) one-half of the difference between the Settlement Amount of the party with the higher Settlement Amount ("X") and the Settlement Amount of the party with the lower Settlement Amount ("Y") and (b) the Termination Currency Equivalent of the Unpaid Amounts owing to X less (II) the Termination Currency Equivalent of the Unpaid Amounts owing to Y; and (B) if Loss applies, each party will determine its Loss in respect of this Agreement (or, if fewer than all the Transactions are being terminated, in respect of all Terminated Transactions) and an amount will be payable equal to one-half of the difference between the Loss of the party with the higher Loss ("X") and the Loss of the party with the lower Loss ("Y"). If the amount payable is a positive number, Y will pay it to X; if it is a negative number, X will pay the absolute value of that amount to Y. (iii) Adjustment for Bankruptcy. In circumstances where an Early Termination Date occurs because "Automatic Early Termination" applies in respect of a party, the amount determined under this Section 6(e) will be subject to such adjustments as are appropriate and permitted by law to reflect any payments or deliveries made by one party to the other under this Agreement (and retained by such other party) during the period from the relevant Early Termination Date to the date for payment determined under Section 6(d)(ii). (iv) Pre-Estimate. The parties agree that if Market Quotation applies an amount recoverable under this Section 6(e) is a reasonable pre-estimate of loss and not a penalty. Such amount is payable for the loss of bargain and the loss of protection against future risks and except as otherwise provided in this Agreement neither party will be entitled to recover any additional damages as a consequence of such losses. 10 7. Transfer Subject to Section 6(b)(ii), neither this Agreement nor any interest or obligation in or under this Agreement may be transferred (whether by way of security or otherwise) by either party without the prior written consent of the other party, except that:-- (a) a party may make such a transfer of this Agreement pursuant to a consolidation or amalgamation with, or merger with or into, or transfer of all or substantially all its assets to, another entity (but without prejudice to any other right or remedy under this Agreement); and (b) a party may make such a transfer of all or any part of its interest in any amount payable to it from a Defaulting Party under Section 6(e). Any purported transfer that is not in compliance with this Section will be void. 8. Contractual Currency (a) Payment in the Contractual Currency. Each payment under this Agreement will be made in the relevant currency specified in this Agreement for that payment (the "Contractual Currency"). To the extent permitted by applicable law, any obligation to make payments under this Agreement in the Contractual Currency will not be discharged or satisfied by any tender in any currency other than the Contractual Currency, except to the extent such tender results in the actual receipt by the party to which payment is owed, acting in a reasonable manner and in good faith in converting the currency so tendered into this Contractual Currency, of the full amount in the Contractual Currency of all amounts payable in respect of this Agreement. If for any reason the amount in the Contractual Currency so received falls short of the amount in the Contractual Currency payable in respect of this Agreement, the party required to make the payment will, to the extent permitted by applicable law, immediately pay such additional amount in the Contractual Currency as may be necessary to compensate for the shortfall. If for any reason the amount in the Contractual Currency so received exceeds the amount in the Contractual Currency payable in respect of this Agreement, the party receiving the payment will refund promptly the amount of such excess. (b) Judgments. To the extent permitted by applicable law, if any judgment or order expressed in a currency other than the Contractual Currency is rendered (i) for the payment of any amount owing in respect of this Agreement, (ii) for the payment of any amount relating to any early termination in respect of this Agreement or (iii) in respect of a judgment or order of another court for the payment of any amount described in (i) or (ii) above, the party seeking recovery, after recovery in full of the aggregate amount to which such party is entitled pursuant to the judgment or order, will be entitled to receive immediately from the other party the amount of any shortfall of the Contractual Currency received by such party as a consequence of sums paid in such other currency and will refund promptly to the other party any excess of the Contractual Currency received by such party as a consequence of sums paid in such other currency if such shortfall or such excess arises or results from any variation between the rate of exchange at which the Contractual Currency is converted into the currency of the judgment or order for the purposes of such judgment or order and the rate of exchange at which such party is able, acting in a reasonable manner and in good faith in converting the currency received into the Contractual Currency, to purchase the Contractual Currency with the amount of the currency of the judgment or order actually received by such party. The term "rate of exchange" includes, without limitation, any premiums and costs of exchange payable in connection with the purchase of or conversion into the Contractual Currency. (c) Separate Indemnities. To the extent permitted by applicable law, these indemnities constitute separate and independent obligations from the other obligations in this Agreement, will be enforceable as separate and independent causes of action, will apply notwithstanding any indulgence granted by the party to which any payment is owed and will not be affected by judgment being obtained or claim or proof being made for any other sums payable in respect of this Agreement. (d) Evidence of Loss. For the purpose of this Section 8, it will be sufficient for a party to demonstrate that it would have suffered a loss had an actual exchange or purchase been made. 11 9. Miscellaneous (a) Entire Agreement. This Agreement constitutes the entire agreement and understanding of the parties with respect to its subject matter and supersedes all oral communication and prior writings with respect thereto. (b) Amendments. No amendment, modification or waiver in respect of this Agreement will be effective unless in writing (including a writing evidenced by a facsimile transmission) and executed by each of the parties or confirmed by an exchange of telexes or electronic messages on an electronic messaging system. (c) Survival of Obligations. Without prejudice to Sections 2(a)(iii) and 6(c)(ii), the obligations of the parties under this Agreement will survive the termination of any Transaction. (d) Remedies Cumulative. Except as provided in this Agreement, the rights, powers, remedies and privileges provided in this Agreement are cumulative and not exclusive of any rights, powers, remedies and privileges provided by law. (e) Counterparts and Confirmations. (i) This Agreement (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including by facsimile transmission), each of which will be deemed an original. (ii) The parties intend that they are legally bound by the terms of each Transaction from the moment they agree to those terms (whether orally or otherwise). A Confirmation shall be entered into as soon as practicable and may be executed and delivered in counterparts (including by facsimile transmission) or be created by an exchange of telexes or by an exchange of electronic messages on an electronic messaging system, which in each case will be sufficient for all purposes to evidence a binding supplement to this Agreement. The parties will specify therein or through another effective means that any such counterpart, telex or electronic message constitutes a Confirmation. (f) No Waiver of Rights. A failure or delay in exercising any right, power or privilege in respect of this Agreement will not be presumed to operate as a waiver, and a single or partial exercise of any right, power or privilege will not be presumed to preclude any subsequent or further exercise, of that right, power or privilege or the exercise of any other right, power or privilege. (g) Headings. The headings used in this Agreement are for convenience of reference only and are not to affect the construction of or to be taken into consideration in interpreting this Agreement. 10. Offices; Multibranch Parties (a) If Section 10(a) is specified in the Schedule as applying, each party that enters into a Transaction through an Office other than its head or home office represents to the other party that, notwithstanding the place of booking office or jurisdiction of incorporation or organisation of such party, the obligations of such party are the same as if it had entered into the Transaction through its head or home office. This representation will be deemed to be repeated by such party on each date on which a Transaction is entered into. (b) Neither party may change the Office through which it makes and receives payments or deliveries for the purpose of a Transaction without the prior written consent of the other party. (c) If a party is specified as a Multibranch Party in the Schedule, such Multibranch Party may make and receive payments or deliveries under any Transaction through any Office listed in the Schedule, and the Office through which it makes and receives payments or deliveries with respect to a Transaction will be specified in the relevant Confirmation. 11. Expenses A Defaulting Party will, on demand, indemnify and hold harmless the other party for and against all reasonable out-of-pocket expenses, including legal fees and Stamp Tax, incurred by such other party by reason of the enforcement and protection of its rights under this Agreement or any Credit Support Document 12 to which the Defaulting Party is a party or by reason of the early termination of any Transaction, including, but not limited to, costs of collection. 12. Notices (a) Effectiveness. Any notice or other communication in respect of this Agreement may be given in any manner set forth below (except that a notice or other communication under Section 5 or 6 may not be given by facsimile transmission or electronic messaging system) to the address or number or in accordance with the electronic messaging system details provided (see the Schedule) and will be deemed effective as indicated:-- (i) if in writing and delivered in person or by courier, on the date it is delivered; (ii) if sent by telex, on the date the recipient's answerback is received; (iii) if sent by facsimile transmission, on the date that transmission is received by a responsible employee of the recipient in legible form (it being agreed that the burden of proving receipt will be on the sender and will not be met by a transmission report generated by the sender's facsimile machine); (iv) if sent by certified or registered mail (airmail, if overseas) or the equivalent (return receipt requested), on the date that mail is delivered or its delivery is attempted; or (v) if sent by electronic messaging system, on the date that electronic message is received, unless the date of that delivery (or attempted delivery) or that receipt, as applicable, is not a Local Business Day or that communication is delivered (or attempted) or received, as applicable, after the close of business on a Local Business Day, in which case that communication shall be deemed given and effective on the first following day that is a Local Business Day. (b) Change of Addresses. Either party may by notice to the other change the address, telex or facsimile number or electronic messaging system details at which notices or other communications are to be given to it. 13. Governing Law and Jurisdiction (a) Governing Law. This Agreement will be governed by and construed in accordance with the law specified in the Schedule. (b) Jurisdiction. With respect to any suit, action or proceedings relating to this Agreement ("Proceedings"), each party irrevocably:-- (i) submits to the jurisdiction of the English courts, if this Agreement is expressed to be governed by English law, or to the non-exclusive jurisdiction of the courts of the State of New York and the United States District Court located in the Borough of Manhattan in New York City, if this Agreement is expressed to be governed by the laws of the State of New York; and (ii) waives any objection which it may have at any time to the laying of venue of any Proceedings brought in any such court, waives any claim that such Proceedings have been brought in an inconvenient forum and further waives the right to object, with respect to such Proceedings, that such court does not have any jurisdiction over such party. Nothing in this Agreement precludes either party from bringing Proceedings in any other jurisdiction (outside, if this Agreement is expressed to be governed by English law, the Contracting States, as defined in Section 1(3) of the Civil Jurisdiction and Judgments Act 1982 or any modification, extension or re-enactment thereof for the time being in force) nor will the bringing of Proceedings in any one or more jurisdictions preclude the bringing of Proceedings in any other jurisdiction. (c) Service of Process. Each party irrevocably appoints the Process Agent (if any) specified opposite its name in the Schedule to receive, for it and on its behalf, service of process in any Proceedings. If for any 13 reason any party's Process Agent is unable to act as such, such party will promptly notify the other party and within 30 days appoint a substitute process agent acceptable to the other party. The parties irrevocably consent to service of process given in the manner provided for notices in Section 12. Nothing in this Agreement will affect the right of either party to serve process in any other manner permitted by law. (d) Waiver of Immunities. Each party irrevocably waives, to the fullest extent permitted by applicable law, with respect to itself and its revenues and assets (irrespective of their use or intended use), all immunity on the grounds of sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any court, (iii) relief by way of injunction, order for specific performance or for recovery of property, (iv) attachment of its assets (whether before or after judgment) and (v) execution or enforcement of any judgment to which it or its revenues or assets might otherwise be entitled in any Proceedings in the courts of any jurisdiction and irrevocably agrees, to the extent permitted by applicable law, that it will not claim any such immunity in any Proceedings. 14. Definitions As used in this Agreement:-- "Additional Termination Event" has the meaning specified in Section 5(b). "Affected Party" has the meaning specified in Section 5(b). "Affected Transactions" means (a) with respect to any Termination Event consisting of an Illegality, Tax Event or Tax Event Upon Merger, all Transactions affected by the occurrence of such Termination Event and (b) with respect to any other Termination Event, all Transactions. "Affiliate" means, subject to the Schedule, in relation to any person, any entity controlled, directly or indirectly, by the person, any entity that controls, directly or indirectly, the person or any entity directly or indirectly under common control with the person. For this purpose, "control" of any entity or person means ownership of a majority of the voting power of the entity or person. "Applicable Rate" means:-- (a) in respect of obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate; (b) in respect of an obligation to pay an amount under Section 6(e) of either party from and after the date (determined in accordance with Section 6(d)(ii)) on which that amount is payable, the Default Rate; (c) in respect of all other obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default Rate; and (d) in all other cases, the Termination Rate. "Burdened Party" has the meaning specified in Section 5(b). "Change in Tax Law" means the enactment, promulgation, execution or ratification of, or any change in or amendment to, any law (or in the application or official interpretation of any law) that occurs on or after the date on which the relevant Transaction is entered into. "consent" includes a consent, approval, action, authorisation, exemption, notice, filing, registration or exchange control consent. "Credit Event Upon Merger" has the meaning specified in Section 5(b). "Credit Support Document" means any agreement or instrument that is specified as such in this Agreement. "Credit Support Provider" has the meaning specified in the Schedule. "Default Rate" means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the relevant payee (as certified by it) if it were to fund or of funding the relevant amount plus 1% per annum. 14 "Defaulting Party" has the meaning specified in Section 6(a). "Early Termination Date" means the date determined in accordance with Section 6(a) or 6(b)(iv). "Event of Default" has the meaning specified in Section 5(a) and, if applicable, in the Schedule. "Illegality" has the meaning specified in Section 5(b). "Indemnifiable Tax" means any Tax other than a Tax that would not be imposed in respect of a payment under this Agreement but for a present or former connection between the jurisdiction of the government or taxation authority imposing such Tax and the recipient of such payment or a person related to such recipient (including, without limitation, a connection arising from such recipient or related person being or having been a citizen or resident of such jurisdiction, or being or having been organised, present or engaged in a trade or business in such jurisdiction, or having or having had a permanent establishment or fixed place of business in such jurisdiction, but excluding a connection arising solely from such recipient or related person having executed, delivered, performed its obligations or received a payment under, or enforced, this Agreement or a Credit Support Document). "law" includes any treaty, law, rule or regulation (as modified, in the case of tax matters, by the practice of any relevant governmental revenue authority) and "lawful" and "unlawful" will be construed accordingly. "Local Business Day" means, subject to the Schedule, a day on which commercial banks are open for business (including dealings in foreign exchange and foreign currency deposits) (a) in relation to any obligation under Section 2(a)(i), in the place(s) specified in the relevant Confirmation or, if not so specified, as otherwise agreed by the parties in writing or determined pursuant to provisions contained, or incorporated by reference, in this Agreement, (b) in relation to any other payment, in the place where the relevant account is located and, if different, in the principal financial centre, if any, of the currency of such payment, (c) in relation to any notice or other communication, including notice contemplated under Section 5(a)(i), in the city specified in the address for notice provided by the recipient and, in the case of a notice contemplated by Section 2(b), in the place where the relevant new account is to be located and (d) in relation to Section 5(a)(v)(2), in the relevant locations for performance with respect to such Specified Transaction. "Loss" means, with respect to this Agreement or one or more Terminated Transactions, as the case may be, and a party, the Termination Currency Equivalent of an amount that party reasonably determines in good faith to be its total losses and costs (or gain, in which case expressed as a negative number) in connection with this Agreement or that Terminated Transaction or group of Terminated Transactions, as the case may be, including any loss of bargain, cost of funding or, at the election of such party but without duplication, loss or cost incurred as a result of its terminating, liquidating, obtaining or reestablishing any hedge or related trading position (or any gain resulting from any of them). Loss includes losses and costs (or gains) in respect of any payment or delivery required to have been made (assuming satisfaction of each applicable condition precedent) on or before the relevant Early Termination Date and not made, except, so as to avoid duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does not include a party's legal fees and out-of-pocket expenses referred to under Section 11. A party will determine its Loss as of the relevant Early Termination Date, or, if that is not reasonably practicable, as of the earliest date thereafter as is reasonably practicable. A party may (but need not) determine its Loss by reference to quotations of relevant rates or prices from one or more leading dealers in the relevant markets. "Market Quotation" means, with respect to one or more Terminated Transactions and a party making the determination, an amount determined on the basis of quotations from Reference Market-makers. Each quotation will be for an amount, if any, that would be paid to such party (expressed as a negative number) or by such party (expressed as a positive number) in consideration of an agreement between such party (taking into account any existing Credit Support Document with respect to the obligations of such party) and the quoting Reference Market-maker to enter into a transaction (the "Replacement Transaction") that would have the effect of preserving for such party the economic equivalent of any payment or delivery (whether the underlying obligation was absolute or contingent and assuming the satisfaction of each applicable condition precedent) by the parties under Section 2(a)(i) in respect of such Terminated Transaction or group of Terminated Transactions that would, but for the occurrence of the relevant Early Termination Date, have 15 been required after that date. For this purpose, Unpaid Amounts in respect of the Terminated Transaction or group of Terminated Transactions are to be excluded but, without limitation, any payment or delivery that would, but for the relevant Early Termination Date, have been required (assuming satisfaction of each applicable condition precedent) after that Early Termination Date is to be included. The Replacement Transaction would be subject to such documentation as such party and the Reference Market-maker may, in good faith, agree. The party making the determination (or its agent) will request each Reference Market-maker to provide its quotation to the extent reasonably practicable as of the same day and time (without regard to different time zones) on or as soon as reasonably practicable after the relevant Early Termination Date. The day and time as of which those quotations are to be obtained will be selected in good faith by the party obliged to make a determination under Section 6(e), and, if each party is so obliged, after consultation with the other. If more than three quotations are provided, the Market Quotation will be the arithmetic mean of the quotations, without regard to the quotations having the highest and lowest values. If exactly three such quotations are provided, the Market Quotation will be the quotation remaining after disregarding the highest and lowest quotations. For this purpose, if more than one quotation has the same highest value or lowest value, then one of such quotations shall be disregarded. If fewer than three quotations are provided, it will be deemed that the Market Quotation in respect of such Terminated Transaction or group of Terminated Transactions cannot be determined. "Non-default Rate" means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the Non-defaulting Party (as certified by it) if it were to fund the relevant amount. "Non-defaulting Party" has the meaning specified in Section 6(a). "Office" means a branch or office of a party, which may be such party's head or home office. "Potential Event of Default" means any event which, with the giving of notice or the lapse of time or both, would constitute an Event of Default. "Reference Market-makers" means four leading dealers in the relevant market selected by the party determining a Market Quotation in good faith (a) from among dealers of the highest credit standing which satisfy all the criteria that such party applies generally at the time in deciding whether to offer or to make an extension of credit and (b) to the extent practicable, from among such dealers having an office in the same city. "Relevant Jurisdiction" means, with respect to a party, the jurisdictions (a) in which the party is incorporated, organised, managed and controlled or considered to have its seat, (b) where an Office through which the party is acting for purposes of this Agreement is located, (c) in which the party executes this Agreement and (d) in relation to any payment, from or through which such payment is made. "Scheduled Payment Date" means a date on which a payment or delivery is to be made under Section 2(a)(i) with respect to a Transaction. "Set-off" means set-off, offset, combination of accounts, right of retention or withholding or similar right or requirement to which the payer of an amount under Section 6 is entitled or subject (whether arising under this Agreement, another contract, applicable law or otherwise) that is exercised by, or imposed on, such payer. "Settlement Amount" means, with respect to a party and any Early Termination Date, the sum of:-- (a) the Termination Currency Equivalent of the Market Quotations (whether positive or negative) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation is determined; and (b) such party's Loss (whether positive or negative and without reference to any Unpaid Amounts) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation cannot be determined or would not (in the reasonable belief of the party making the determination) produce a commercially reasonable result. "Specified Entity" has the meaning specified in the Schedule. 16 "Specified Indebtedness" means, subject to the Schedule, any obligation (whether present or future, contingent or otherwise, as principal or surety or otherwise) in respect of borrowed money. "Specified Transaction" means, subject to the Schedule, (a) any transaction (including an agreement with respect thereto) now existing or hereafter entered into between one party to this Agreement (or any Credit Support Provider of such party or any applicable Specified Entity of such party) and the other party to this Agreement (or any Credit Support Provider of such other party or any applicable Specified Entity of such other party) which is a rate swap transaction, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap, equity or equity index option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option or any other similar transaction (including any option with respect to any of these transactions), (b) any combination of these transactions and (c) any other transaction identified as a Specified Transaction in this Agreement or the relevant confirmation. "Stamp Tax" means any stamp, registration, documentation or similar tax. "Tax" means any present or future tax, levy, impost, duty, charge, assessment or fee of any nature (including interest, penalties and additions thereto) that is imposed by any government or other taxing authority in respect of any payment under this Agreement other than a stamp, registration, documentation or similar tax. "Tax Event" has the meaning specified in Section 5(b). "Tax Event Upon Merger" has the meaning specified in Section 5(b). "Terminated Transactions" means with respect to any Early Termination Date (a) if resulting from a Termination Event, all Affected Transactions and (b) if resulting from an Event of Default, all Transactions (in either case) in effect immediately before the effectiveness of the notice designating that Early Termination Date (or, if "Automatic Early Termination" applies, immediately before that Early Termination Date). "Termination Currency" has the meaning specified in the Schedule. "Termination Currency Equivalent" means, in respect of any amount denominated in the Termination Currency, such Termination Currency amount and, in respect of any amount denominated in a currency other than the Termination Currency (the "Other Currency"), the amount in the Termination Currency determined by the party making the relevant determination as being required to purchase such amount of such Other Currency as at the relevant Early Termination Date, or, if the relevant Market Quotation or Loss (as the case may be), is determined as of a later date, that later date, with the Termination Currency at the rate equal to the spot exchange rate of the foreign exchange agent (selected as provided below) for the purchase of such Other Currency with the Termination Currency at or about 11:00 a.m. (in the city in which such foreign exchange agent is located) on such date as would be customary for the determination of such a rate for the purchase of such Other Currency for value on the relevant Early Termination Date or that later date. The foreign exchange agent will, if only one party is obliged to make a determination under Section 6(e), be selected in good faith by that party and otherwise will be agreed by the parties. "Termination Event" means an Illegality, a Tax Event or a Tax Event Upon Merger or, if specified to be applicable, a Credit Event Upon Merger or an Additional Termination Event. "Termination Rate" means a rate per annum equal to the arithmetic mean of the cost (without proof or evidence of any actual cost) to each party (as certified by such party) if it were to fund or of funding such amounts. "Unpaid Amounts" owing to any party means, with respect to an Early Termination Date, the aggregate of (a) in respect of all Terminated Transactions, the amounts that became payable (or that would have become payable but for Section 2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early Termination Date and which remain unpaid as at such Early Termination Date and (b) in respect of each Terminated Transaction, for each obligation under Section 2(a)(i) which was (or would have been but for Section 2(a)(iii)) required to be settled by delivery to such party on or prior to such Early Termination Date and which has not been so settled as at such Early Termination Date, an amount equal to the fair market 17 value of that which was (or would have been) required to be delivered as of the originally scheduled date for delivery, in each case together with (to the extent permitted under applicable law) interest, in the currency of such amounts, from (and including) the date such amounts or obligations were or would have been required to have been paid or performed to (but excluding) such Early Termination Date, at the Applicable Rate. Such amounts of interest will be calculated on the basis of daily compounding and the actual number of days elapsed. The fair market value of any obligation referred to in clause (b) above shall be reasonably determined by the party obliged to make the determination under Section 6(e) or, if each party is so obliged, it shall be the average of the Termination Currency Equivalents of the fair market values reasonably determined by both parties. IN WITNESS WHEREOF the parties have executed this document on the respective dates specified below with effect from the date specified on the first page of this document. DEUTSCHE BANK AG, NEW YORK BRANCH FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST - ------------------------------------------ ---------------------------------------------------- (Name of Party) (Name of Party) By: Bankers Trust Company, not in its individual capacity, but solely as owner trustee By: ______________________________________ By: ________________________________________________ Name: Name: Title: Title: Date: Date:
18 (Multicurrency--Cross Border) ISDA (R) International Swap Dealers Association, Inc. SCHEDULE to the Master Agreement dated as of ____________ between DEUTSCHE BANK AG, NEW and FIRST CONSUMERS CREDIT CARD YORK BRANCH MASTER NOTE TRUST ("Party A") ("Party B") PART 1: Termination Provisions ---------------------- (a) "Indenture" means the Master Indenture dated as of March 1, 2001, between First Consumers Credit Master Note Trust, as Issuer, and The Bank of New York, as Indenture Trustee, as supplemented by the Series 2001-A Indenture Supplement dated as of March 1, 2001, between First Consumers Credit Card Master Note Trust, as the Issuer or the Trust, and The Bank of New York, as the Indenture Trustee, in each case, as amended, modified, supplemented, restated or replaced from time to time. (b) "Specified Entity" means in relation to Party A for the purpose of:- Section 5(a)(v) (Default under Specified Transaction), none; Section 5(a)(vi) (Cross Default), none; Section 5(a)(vii) (Bankruptcy), none; and Section 5(b)(iv) (Credit Event Upon Merger), none; in relation to Party B for the purpose of:- Section 5(a)(v) (Default under Specified Transaction) none; Section 5(a)(vi) (Cross Default), none; Section 5(a)(vii) (Bankruptcy), none; and Section 5(b)(iv) (Credit Event Upon Merger), none. (c) "Specified Transaction" will have the meaning specified in Section 14. 1 (d) The "Breach of Agreement" provisions of Section 5(a)(ii), the "Misrepresentation" provisions of Section 5(a)(iv), and the "Default under Specified Transactions" provisions of Section 5(a)(v) will not apply to Party B. The "Cross Default" provisions of Section 5(a)(vi) will not apply to Party A or Party B. (e) The "Credit Event Upon Merger" provisions of Section 5(b)(iv) will not apply to Party A will not apply to Party B. (f) The "Automatic Early Termination" provision of Section 6(a) will not apply to Party A will not apply to Party B. (g) Payments on Early Termination. For the purpose of Section 6(e): (i) Market Quotation will apply. (ii) The Second Method will apply. (h) "Termination Currency" means United States Dollars. (i) Additional Termination Event; Redemption of the Secured Notes. (a) Party B shall, as provided in the Indenture, direct the Indenture Trustee to notify Party A if notice is given pursuant to the Indenture of a redemption by Party B of all of the Notes (any such redemption by Party B of all of the Notes, a "Redemption Event"). (b) If a Redemption Event occurs it shall be an Additional Termination Event for which Party B shall be the sole Affected Party and each Transaction shall be terminated in full. (c) If a Redemption Event is to occur, an Early Termination Date in respect of each Transaction shall be deemed to occur on the Distribution Date in respect of such Redemption Event. Any Settlement Amount payable in respect of such Redemption Event shall be paid, in the case of Party A and Party B, on the date of such Early Termination Date; provided that no such payments shall be made by Party B until the Note Principal Balance (as defined in the Indenture Supplement) has been reduced to zero. (d) Any change or amendment to the Indenture that affects the rights of Party A. (j) Unauthorized Amendments. Party B shall deliver to Party A a copy of any proposed Supplemental Indenture. (k) Downgrade of Party A. If a Ratings Event (as defined below) shall occur and be continuing with respect to Party A, then Party A shall, within 5 Local Business Days of such Ratings Event, (A) give notice to Party B of the occurrence of such Ratings Event, and (B) use reasonable efforts to transfer Party A's rights and obligations under the Agreement and all Confirmations to another party, subject to satisfaction of the Rating Agency Condition (as defined below), and at the cost of Party A. Unless such a transfer by Party A has occurred within 20 Local Business Days after 2 the occurrence of a Ratings Event, Party B shall demand that Party A post Eligible Collateral on a mark-to-market basis, to secure Party B's exposure, if any, to Party A, and such Eligible Collateral shall be provided in accordance with a Credit Support Annex to be attached hereto and made a part hereof within 10 Local Business Days of Party B's demand therefor. The Eligible Collateral to be posted and the Credit Support Annex to be executed and delivered shall be subject to the Rating Agency Condition. Notwithstanding the addition of the Credit Support Annex and the posting of Eligible Collateral, Party A shall continue to use reasonable efforts to transfer its rights and obligations to an acceptable third party; provided, however, that Party A's obligations to find a transferee and to post Eligible Collateral under such Credit Support Annex shall remain in effect only for so long as a Ratings Event is continuing with respect to Party A. For the purpose of this Part 1(k), a "Ratings Event" shall occur with respect to Party A if the long-term and short-term senior unsecured deposit ratings of Party A cease to be at least A+ and A- 1 by Standard & Poor's Ratings Service or any successor thereto ("S&P"), at least A1 and P-1 by Moody's Investors Service, Inc. or any successor thereto ("Moody's"), or at least A+ and F-1 by Fitch Ratings, Inc. or any successor thereto ("Fitch"), to the extent such obligations are rated by S&P, Moody's or Fitch. "Rating Agency Condition" has the meaning specified in the Indenture defined in Part 1(a) of this Schedule. The failure by Party A to post Eligible Collateral in accordance herewith shall constitute an Event of Default with Party A as the Defaulting Party. PART 2: Tax Representations ------------------- (a) Payer Tax Representations. For the purpose of Section 3(e) of this Agreement, Party A and Party B will make the following representation:- It is not required by any applicable law, as modified by the practice of any relevant governmental revenue authority of any Relevant Jurisdiction to make any deduction or withholding for or on account of any Tax from any payment (other than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to be made by it to the other party under this Agreement. In making this representation, it may rely on (x) the accuracy of any representations made by the other party pursuant to Section 3(f) of this Agreement, (y) the satisfaction of the agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and the accuracy and effectiveness of any document provided by the other party pursuant to Section 4(a)(i) or 4(a)(iii) of this Agreement and (z) the satisfaction of the agreement of the other party contained in Section 4(d) of this Agreement, provided that it shall not be a breach of this representation where reliance is placed on clause (y) and the other party does not deliver a form or document under Section 4(a)(iii) by reason of material prejudice to its legal or commercial position. (b) Payee Tax Representations. For the purpose of Section 3(f) of this Agreement, Party A and Party B will make the following representations specified below, if any:- none PART 3: Agreement to Deliver Documents ------------------------------ For the purpose of Section 4(a)(i) and (ii) of this Agreement, each party agrees to deliver the following documents: 3 (a) Tax forms, documents or certificates to be delivered are: Party Form/Document/Certificate Date by which to be delivered required to deliver document ------------ ----------------------------- ----------------------------- Party A and Any form, document or Upon request Party B certificate as may be requested pursuant to Section 4(a)(iii) of this Agreement. Party B An executed United States (i) As soon as reasonably Internal Revenue Service practicable after execution Form W-9 (or any successor of this Agreement, (ii) thereto), as applicable. promptly upon reasonable demand by Party A and (iii) promptly upon learning that any such form previously provided by Party B has become obsolete or incorrect. (b) Other documents to be delivered are:- Party Form/Document/Certificate Date by Covered by required to which to be Section 3(d) deliver delivered Representation document --------------- ----------------------------- ------------ ---------------- Party B Annual Report of Party As soon as Yes B and of any Credit Support available and Provider thereof containing in any event audited financial statements within 120 certified independent days after the certified public accountants end of each and prepared in accordance fiscal year of with generally accepted Party B and of accounting principles in the the Credit country in which such party Support Provider and such Credit Support Provider is organized 4 Party B Monthly Reports of Party B and As soon as Yes quarterly unaudited financial available and in statements of any Credit Support any event within Provider thereof containing financial 30 days after the statements of such party's fiscal end of each fiscal quarter prepared in accordance with quarter of Party B generally accepted accounting and of the Credit principles in the country in which Support Provider such Credit Support Provider is organized Party B A duly executed copy of the Credit At or within No Support Document specified in Part 4 thirty days after of the Schedule or in any Confirmation execution hereof Party A and Certified copies of all corporate Upon execution and Yes Part B authorizations, an opinion that the delivery of this Agreement is enforceable, and any Agreement other documents with respect to the execution, delivery and performance of this Agreement and the Indenture. Party A and Certificate of authority and specimen Upon execution and Yes Party B signatures of individuals executing delivery of this this Agreement, any Credit Support Agreement and Document and any Confirmations thereafter upon request of the other party
PART 4: Miscellaneous ------------- (a) Address for Notices. For the purpose of Section 12(a) of this Agreement:- (i) All notices to Party A under Sections 5 or 6 (other than notices under Section 5(a)(i)) shall be sent to: Deutsche Bank AG, Head Office Taunusanlage 12 60262 Frankfurt GERMANY Attention: Legal Department Telex No: 411836 or 416731 or 41233 Answerback: DBF-D 5 (ii) All notices to Party A (other than those provided for in paragraph (i) above) shall be sent directly to the office through which Party A is acting for the relevant Transaction, using the address and contact particulars specified in the Confirmation for the purposes of confirming that Transaction. If no such particulars are so specified, such notices shall be sent to the address of the relevant office set out below: Where Party A is acting through its New York Branch: Deutsche Bank AG, New York Branch 31 W. 52nd Street New York, New York 10019 USA Attn: Swap Group Tel: (1)(212) 469-4338 Fax: (1)(212) 469-4654 Telex: 429166 Answerback: DEUTNYK Address for notice or communications to Party B: First Consumers Credit Card Master Note Trust c/o Bankers Trust Company Four Albany Street, 10/th/ Floor New York, NY 10006 Attention: Corporate Trust & Agency Services Telephone No.: 212-250-6323 Facsimile No.: 212-250-6439 With a copy to: John R. Steele, Treasurer Spiegel, Inc. 3500 Lacey Road Downers Grove, IL 60515-5432 Telephone No.: 630-769-3250 Facsimile No.: 630-769-3750 (b) Process Agent. For the purpose of Section 13(c): Party A appoints as its Process Agent: Not applicable. Party B appoints as its Process Agent: Not applicable. (c) Offices. The provisions of Section 10(a) will apply to this Agreement. 6 (d) Multibranch Party. For the purpose of Section 10 of this Agreement:- Party A is not a Multibranch Party. Party B is not a Multibranch Party. (e) Calculation Agent. The Calculation Agent is Party A. (f) Credit Support Document. Details of any Credit Support Document: Not applicable. (g) Credit Support Provider. Credit Support Provider means in relation to Party A: Not applicable. Credit Support Provider means in relation to Party B: Not applicable. (h) Governing Law. This Agreement will be governed by and construed in accordance with the laws of the State of New York (without reference to its conflict of laws doctrine, other than Section 5-1401 of the General Obligations Law). (i) Amendments. Any amendments to the Agreement, Schedule and/or Confirmation shall be subject to the Rating Agency Condition. (j) "Affiliate" will have the meaning specified in Section 14 of this Agreement. PART 5: Other Provisions ---------------- (a) Additional Agreements. Party A agrees that it shall not enter a transaction of the type referred to in 5(a)(viii) (Merger Without Assumption) where the resulting, surviving or transferee entity fails to assume all of the obligations of Party A hereunder. (b) Delivery of Confirmations. For each Transaction entered into hereunder, Party A shall promptly send to Party B a Confirmation via facsimile transmission. Party B agrees to respond to such Confirmation within two (2) Local Business Days, either confirming agreement thereto or requesting a correction of any error(s) contained therein. Failure by Party A to send a Confirmation or of Party B to respond within such period shall not affect the validity or enforceability of such Transaction. Absent manifest error, there shall be a presumption that the terms contained in such Confirmation are the terms of the Transaction. (c) Recording of Conversations. Each party to this Agreement acknowledges and agrees to the tape recording of conversations between trading and marketing personnel of the parties to this Agreement whether by one or other or both of the parties or their agents, and that any such tape recordings may be submitted in evidence in any Proceedings relating to the Agreement. (d) Furnishing Specified Information. Section 4(a)(iii) is hereby amended by inserting "promptly upon the earlier of (i)" in lieu of the word "upon" at the beginning thereof and inserting "or (ii) 7 such party learning that the form or document is required" before the word "any" on the first line thereof. (e) Notice by Facsimile Transmission. Section 12(a) is hereby amended by inserting the words "2(b)," between the word "Section" and the number "5" and inserting the words "or 13(c)" between the number "6" and the word "may" in the second line thereof. (f) Section 3(a) of this Agreement is amended by (i) deleting the word "and" at the end of clause (iv); (ii) deleting the period at the end of clause (v) and inserting therein "; and " ; and (iii) by inserting the following additional representation: "(vi) Eligible Contract Participant. It is an `eligible contract participant' as defined under the Commodity Exchange Act, Section 1(a)(12)." (g) Section 3 is revised so as to add the following Section (g) at the end thereof: "(g) Relationship Between Parties. Each party represents to the other party and will be deemed to represent to the other party on the date on which it enters into a Transaction that (absent a written agreement between the parties that expressly imposes affirmative obligations to the contrary for that Transaction):- (i) Non-Reliance. It is acting for its own account, and it has made its own independent decisions to enter into that Transaction and as to whether that Transaction is appropriate or proper for it based upon its own judgment and upon advice from such advisors as it has deemed necessary. It is not relying on any communication (written or oral) of the other party as investment advice or as a recommendation to enter into that Transaction; it being understood that information and explanations related to the terms and conditions of a Transaction shall not be considered investment advice or a recommendation to enter into that Transaction. Further, such party has not received from the other party any assurance or guarantee as to the expected results of that Transaction. (ii) Evaluation and Understanding. It is capable of evaluating and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of that Transaction. It is also capable of assuming, and assumes, the financial and other risks of that Transaction. (iii) Status of Parties. The other party is not acting as an agent, fiduciary or advisor for it in respect of that Transaction." (h) Waiver of Right to Trial by Jury. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHTS TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY. (i) [Reserved.] 8 (j) Non-Petition. Party A hereby agrees that it will not, prior to the date which is one year and one day after all Series 2001-A Notes issued by Party B pursuant to the Indenture have been paid in full, acquiesce, petition or otherwise invoke or cause Party B to invoke the process of any court or governmental authority for the purpose of commencing or sustaining a case against Party B under any federal or state bankruptcy, insolvency or similar law or for the purpose of appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official for Party B or any substantial part of the property of Party B, or for the purpose of ordering the winding up or liquidation of the affairs of Party B. Nothing herein shall prevent Party A from participating in any such proceeding once commenced. (l) Limited Recourse. The obligations of Party B under this Agreement are limited recourse obligations of Party B, payable solely from the Trust Estate (as such term is defined in the Indenture), subject to and in accordance with the terms of the Indenture, and, following realization of the Trust Estate, any claims of Party A against Party B shall be extinguished. No recourse shall be had for the payment of any amount owing in respect of this Agreement against the trustee, or any officer, member, director, employee, security holder or incorporator thereof (each, an "Affiliated Person") of Party B or its successors or assigns for any amounts payable under this Agreement. It is understood that the foregoing provisions shall not (i) prevent recourse to the Trust Estate for the sums due or to become due under any security, instrument or agreement which is part of the Trust Estate (subject to the priority of payments set forth in the Indenture), or (ii) constitute a waiver, release or discharge of any obligation of Party B arising under this Agreement until the Trust Estate have been realized and the proceeds applied in accordance with the Indenture, whereupon any outstanding obligation of Party B under this Agreement shall be extinguished. (m) Transfer. Section 7 of the Agreement is supplemented by the additional requirement that any transfer or assignment by Party A of its obligations under the Agreement (including any Confirmation), and any amendments to the Agreement (including any Confirmation), shall be subject to the Rating Agency Condition. Party A consents to the pledge and assignment by Party B of its rights and obligations hereunder and under any Transaction to the Indenture Trustee pursuant to the Indenture. (n) Events of Default. (i) Section 5(a)(i) of the Agreement is amended by substituting the following therefor: "Failure by the party to make, when due, any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) required to be made by it within five days of the date due under this Agreement and, upon at least one Business Days' prior notice to the other party." 9 Accepted and agreed: DEUTSCHE BANK AG, NEW YORK FIRST CONSUMERS CREDIT CARD BRANCH MASTER NOTE TRUST By Bankers Trust Company, not in its individual capacity, but solely as Owner Trustee By:.......................... Name: By:.............................. Title: Name: Title: By:.......................... Name: Title: 10 CLASS A CONFIRMATION FOR U.S. DOLLAR INTEREST RATE SWAP TRANSACTION UNDER 2001 MASTER AGREEMENT Date: Our ref: 637970 To: First Consumers Credit Card Master Note From: Deutsche Bank AG, New York Branch Trust 31 West 52/nd/ Street c/o Bankers Trust Company New York, NY 10019 Four Albany Street, 10/th/ Floor New York, NY 10006 Attn: Corporate Trust & Agency Services Contact: [ ] Fax No: (212) 250-6439 Fax No: (212) 469-7210 Tel No: (212) 250-6323 Tel No: (212) 469-5000
Dear Sir/Madam, The purpose of this letter agreement is to confirm the terms and conditions of the Transaction entered into between First Consumers Credit Card Master Note Trust and Deutsche Bank AG, New York Branch (each a "party" and together "the parties") on the Trade Date specified below (the "Transaction"). This letter agreement constitutes a "Confirmation" as referred to in the ISDA Master Agreement specified in paragraph 1 below (the "Agreement"). The definitions and provisions contained in the 1991 ISDA Definitions, as amended by the 1998 Supplement thereto (each as published by the International Swaps and Derivatives Association, Inc., the "Definitions") are incorporated into this Confirmation. In the event of any inconsistency between the Definitions and this Confirmation, this Confirmation will govern. Capitalized terms used herein and not otherwise defined have the meanings set forth in the Definitions or the Indenture dated as of March 1, 2001, between Party B and The Bank of New York, as indenture trustee (the "Indenture") as supplemented by the Indenture Supplement, dated as of March 1, 2001 (the "Indenture Supplement," and together with the Indenture, the "Indenture"). 1. This Confirmation supplements, forms part of, and is subject to, the ISDA Master Agreement (including the Schedule thereto) dated as of March 6, 2001, as amended and supplemented from time to time (the "Agreement"), between the parties. All provisions contained in the Agreement govern this Confirmation except as expressly modified below. In this Confirmation "Party A" means Deutsche Bank AG, New York Branch and "Party B" means First Consumers Credit Card Master Note Trust. 2. The terms of the particular Transaction to which this Confirmation relates are as follows: Notional Amount: Initially, USD_____________ and thereafter an amount equal for each Calculation Period to the Class A Note Principal Balance (as defined in the Indenture Supplement) at the end of the first day of that Calculation Period. Trade Date: Effective Date: Page 1 of 4 Termination Date: The earlier of (i) September 15, 2008, subject to adjustment in accordance with the Following Business Day Convention, and (ii) the date on which the Class A Note Principal Balance (as defined in the Indenture Supplement) is reduced to zero, subject to early termination in accordance with the terms of the Agreement. In accordance with the Indenture Supplement, the Class A Expected Principal Distribution Date is February 15, 2006, subject to the Following Business Day Convention. Fixed Amounts: Fixed Rate Payer: Party B Fixed Rate Payer Payment Dates: The 15/th/ of each month commencing April 16, 2001 and ending on the Termination Date, subject to adjustment in accordance with the Following Business Day Convention Fixed Rate: 5.665% per annum Fixed Rate Day Count Fraction: Actual/360 Floating Amounts: Floating Rate Payer: Party A Floating Rate Payer Payment Dates: The 15/th/ of each month commencing April 16, 2001 and ending on the Termination Date, subject to adjustment in accordance with the Following Business Day Convention. Floating Rate for initial Calculation Period: LIBOR rate Floating Rate Option: USD-LIBOR-BBA Designated Maturity: 1 Month, including initial Calculation Period. Spread: None Floating Rate Day Count Fraction: Actual/360 Reset Dates: First day of each Calculation Period Business Days: New York, Portland, Oregon, and Chicago, Illinois Calculation Agent: Party A 3. Additional Amounts Upon Partial Termination
Page 2 of 4 On any Payment Date prior to the Class A Expected Principal Distribution Date (as defined in the Indenture Supplement), where as a result of principal payments on the Class A Notes (as defined in the Indenture Supplement), the Notional Amount would be reduced by the corresponding reduction in the Class A Note Principal Balance (as defined in the Indenture Supplement), the parties hereto shall treat the portion of such reduction (without duplication) as terminated on such Payment Date (a "Terminated Transaction"). Party A shall calculate the Market Quotation for the Terminated Transaction as set forth below. "Market Quotation" means, with respect to a Terminated Transaction, an amount determined on the basis of quotations from Reference Market-makers. Each quotation will be for an amount, if any, that would be paid to Party A (expressed as a negative number) or by Party A (expressed as a positive number) in consideration of an agreement between Party A and the quoting Reference Market-maker to enter into such Terminated Transaction (with the same fixed and floating payment rates and remaining term as this Transaction) on the relevant Payment Date. Party A will request each Reference Market-maker to provide its quotation to the extent reasonably practicable as of the same day and time (without regard to different time zones) on or as soon as reasonably practicable prior to the relevant Payment Date. The day and time as of which those quotations are to be obtained will be selected in good faith by Party A. If more than three quotations are provided, the Market Quotation will be the arithmetic mean of the quotations, without regard to the quotations having the highest and lowest values. If exactly three such quotations are provided, the Market Quotation will be the quotation remaining after disregarding the highest and lowest quotations. For this purpose, if more than one quotation has the same highest value or lowest value, then one of such quotations shall be disregarded. If fewer than three quotations are provided, Party A will determine the Market Quotation in good faith. Notwithstanding the foregoing, Party A shall be the sole Reference Market-maker unless: (a) the reduction in the Notional Amount of the Transaction is equal to or greater than $50 million on such Payment Date, and (b) the Servicer or the Indenture Trustee requests that quotations from Reference Market-makers other than Party A are utilized. If the amount so determined by Party A in respect of a Terminated Transaction is positive, Party B shall owe such amount to Party A, which shall be payable (with interest thereon accruing from such Payment Date and calculated at the Fixed Rate) on the next Distribution Date to the extent provided in the Indenture; provided that no such payments shall be made by Party B until the Note Principal Balance (as defined in the Indenture Supplement) has been reduced to zero. If such amount is negative, Party A shall owe such amount to Party B, which shall be payable (with interest accruing from such Payment Date and calculated at the Floating Rate) on the Termination Date, net of any amounts payable by Party B to Party A. 4. Credit Support Documents: None. 5. Account Details: Account for payments to Name: Deutsche Bank AG, New York Branch Party A: City: New York ABA# 026003780 Ref: Interest Rate Swap Acct: 100440170004 Account for payments to The Bank of New York Party B: ABA # Page 3 of 4 Name: First Consumers Credit Card Master Note Trust Collection Account Acct: 6. Offices: The Office of Party A for this Transaction is: New York, NY The Office of Party B for this Transaction is: New York, NY Please confirm that the foregoing correctly sets forth the terms and conditions of our agreement by responding within three (3) Business Days by returning via telecopier an executed copy of this Confirmation to the attention of Michael Campbell (fax no. (212) 669-1592). Failure to respond within such period shall not affect the validity or enforceability of this Transaction, and shall be deemed to be an affirmation of the terms and conditions contained herein, absent manifest error. Deutsche Bank AG, New York Branch Accepted and confirmed as of the date first written: First Consumers Credit Card Master Note Trust, By Bankers Trust Company, not in By: _____________________________ its individual capacity, but solely as Owner Trustee Name: Title: By: _____________________________ By: ____________________________________ Name: Name and Title: Title: Page 4 of 4 CLASS B CONFIRMATION FOR U.S. DOLLAR INTEREST RATE SWAP TRANSACTION UNDER 2001 MASTER AGREEMENT Date: Our ref: To: First Consumers Credit Card Master Note From: Deutsche Bank AG, New York Branch Trust 31 West 52/nd/ Street c/o Bankers Trust Company New York, NY 10019 Four Albany Street, 10/th/ Floor New York, NY 10006 Attn: Corporate Trust & Agency Services Contact: [ ] Fax No: (212) 250-6439 Fax No: (212) 469-7210 Tel No: (212) 250-6323 Tel No: (212) 469-5000
Dear Sir/Madam, The purpose of this letter agreement is to confirm the terms and conditions of the Transaction entered into between First Consumers Credit Card Master Note Trust and Deutsche Bank AG, New York Branch (each a "party" and together "the parties") on the Trade Date specified below (the "Transaction"). This letter agreement constitutes a "Confirmation" as referred to in the ISDA Master Agreement specified in paragraph 1 below (the "Agreement"). The definitions and provisions contained in the 1991 ISDA Definitions, as amended by the 1998 Supplement thereto (each as published by the International Swaps and Derivatives Association, Inc., the "Definitions") are incorporated into this Confirmation. In the event of any inconsistency between the Definitions and this Confirmation, this Confirmation will govern. Capitalized terms used herein and not otherwise defined have the meanings set forth in the Definitions or the Indenture dated as of March 1, 2001, between Party B and The Bank of New York, as indenture trustee (the "Indenture") as supplemented by the Indenture Supplement, dated as of March 1, 2001 (the "Indenture Supplement," and together with the Indenture, the "Indenture"). 1. This Confirmation supplements, forms part of, and is subject to, the ISDA Master Agreement (including the Schedule thereto) dated as of March 6, 2001, as amended and supplemented from time to time (the "Agreement"), between the parties. All provisions contained in the Agreement govern this Confirmation except as expressly modified below. In this Confirmation "Party A" means Deutsche Bank AG, New York Branch and "Party B" means First Consumers Credit Card Master Note Trust. 2. The terms of the particular Transaction to which this Confirmation relates are as follows: Notional Amount: Initially, USD____________ and thereafter an amount equal for each Calculation Period to the Class B Note Principal Balance (as defined in the Indenture Supplement) at the end of the first day of that Calculation Period. Trade Date: Effective Date: Page 1 of 5 Termination Date: The earlier of (i) September 15, 2008, subject to adjustment in accordance with the Following Business Day Convention, and (ii) the date on which the Class B Note Principal Balance (as defined in the Indenture Supplement) is reduced to zero, subject to early termination in accordance with the terms of the Agreement. In accordance with the Indenture Supplement, the Class B Expected Principal Distribution Date is March 15, 2006, subject to the Following Business Day Convention. Fixed Amounts: Fixed Rate Payer: Party B Fixed Rate Payer Payment The 15/th/ of each month commencing April 16, Dates: 2001 and ending on the Termination Date, subject to adjustment in accordance with the Following Business Day Convention Fixed Rate: 5.670% per annum Fixed Rate Day Count Actual/360 Fraction: Floating Amounts: Floating Rate Payer: Party A Floating Rate Payer The 15/th/ of each month commencing April 16, Payment Dates: 2001 and ending on the Termination Date, subject to adjustment in accordance with the Following Business Day Convention. Floating Rate for initial Calculation Period: LIBOR rate Floating Rate Option: USD-LIBOR-BBA Designated Maturity: 1 Month Spread: None Floating Rate Day Count Actual/360 Fraction: Reset Dates: First day of each Calculation Period Business Days: New York, Portland, Oregon, and Chicago, Illinois Calculation Agent: Party A 3. Additional Amounts Upon Partial Termination Page 2 of 5 On any Payment Date prior to the Class B Expected Principal Distribution Date (as defined in the Indenture Supplement), where as a result of principal payments on the Class B Notes (as defined in the Indenture Supplement), the Notional Amount would be reduced by the corresponding reduction in the Class B Note Principal Balance (as defined in the Indenture Supplement), the parties hereto shall treat the portion of such reduction (without duplication) as terminated on such Payment Date (a "Terminated Transaction"). Party A shall calculate the Market Quotation for the Terminated Transaction as set forth below. "Market Quotation" means, with respect to a Terminated Transaction, an amount determined on the basis of quotations from Reference Market-makers. Each quotation will be for an amount, if any, that would be paid to Party A (expressed as a negative number) or by Party A (expressed as a positive number) in consideration of an agreement between Party A and the quoting Reference Market-maker to enter into such Terminated Transaction (with the same fixed and floating payment rates and remaining term as this Transaction) on the relevant Payment Date. Party A will request each Reference Market-maker to provide its quotation to the extent reasonably practicable as of the same day and time (without regard to different time zones) on or as soon as reasonably practicable prior to the relevant Payment Date. The day and time as of which those quotations are to be obtained will be selected in good faith by Party A. If more than three quotations are provided, the Market Quotation will be the arithmetic mean of the quotations, without regard to the quotations having the highest and lowest values. If exactly three such quotations are provided, the Market Quotation will be the quotation remaining after disregarding the highest and lowest quotations. For this purpose, if more than one quotation has the same highest value or lowest value, then one of such quotations shall be disregarded. If fewer than three quotations are provided, Party A will determine the Market Quotation in good faith. Notwithstanding the foregoing, Party A shall be the sole Reference Market-maker unless: (a) the reduction in the Notional Amount of the Transaction is equal to or greater than $50 million on such Payment Date, and (b) the Servicer or the Indenture Trustee requests that quotations from Reference Market-makers other than Party A are utilized. If the amount so determined by Party A in respect of a Terminated Transaction is positive, Party B shall owe such amount to Party A, which shall be payable (with interest thereon accruing from such Payment Date and calculated at the Fixed Rate) on the next Distribution Date to the extent provided in the Indenture; provided that no such payments shall be made by Party B until the Note Principal Balance (as defined in the Indenture Supplement) has been reduced to zero. If such amount is negative, Party A shall owe such amount to Party B, which shall be payable (with interest accruing from such Payment Date and calculated at the Floating Rate) on the Termination Date, net of any amounts payable by Party B to Party A. 4. Credit Support Documents: None. 5. Account Details: Account for payments to Name: Deutsche Bank AG, New York Party A: Branch City: New York ABA# 026003780 Ref: Interest Rate Swap Acct: 100440170004 Account for payments to The Bank of New York Party B: ABA # Name: First Consumers Credit Card Master Note Page 3 of 5 Trust Collection Account Acct: 6. Offices: The Office of Party A for this Transaction is: New York, NY The Office of Party B for this Transaction is: New York, NY Please confirm that the foregoing correctly sets forth the terms and conditions of our agreement by responding within three (3) Business Days by returning via telecopier an executed copy of this Confirmation to the attention of Michael Campbell (fax no. (212) 669-1592). Failure to respond within such period shall not affect the validity or enforceability of this Transaction, and shall be deemed to be an affirmation of the terms and conditions contained herein, absent manifest error. Page 4 of 5 Deutsche Bank AG, New York Branch Accepted and confirmed as of the date first written: First Consumers Credit Card Master Note Trust, By Bankers Trust Company, By: _____________________________ not in its individual capacity, but solely as Owner Trustee Name: Title: By: _____________________________ By: __________________________________ Name: Name and Title: Title: Page 5 of 5 EX-4.3 5 0005.txt TRANSFER AND SERVICING AGREEMENT, AS OF MARCH 1, 2001 Exhibit 4.3 ----------- TRANSFER AND SERVICING AGREEMENT between FIRST CONSUMERS NATIONAL BANK, Seller and Servicer, and FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, Issuer, Dated as of March 1, 2001 TABLE OF CONTENTS
Page ARTICLE I DEFINITIONS......................................................................... 1 Section 1.1. Definitions.......................................................... 1 Section 1.2. Other Definitional Provisions........................................ 1 Section 1.3. Monthly Allocation of Finance Charge Receivables..................... 2 ARTICLE II CONVEYANCE OF RECEIVABLES........................................................... 2 Section 2.1. Conveyance of Receivables............................................ 2 Section 2.2. Acceptance by Issuer................................................. 4 Section 2.3. Representations and Warranties of Seller Relating to Seller.......... 5 Section 2.4 Representations and Warranties of Seller Relating to this Agreement and the Receivables........................................ 6 Section 2.5. Covenants of Seller.................................................. 10 Section 2.6. Addition of Accounts................................................. 12 Section 2.7. Removal of Accounts.................................................. 15 Section 2.8. Discount Option...................................................... 16 ARTICLE III ADMINISTRATION AND SERVICING OF RECEIVABLES......................................... 17 Section 3.1. Acceptance of Appointment and Other Matters Relating to the Servicer............................................................. 17 Section 3.2. Servicing Compensation............................................... 18 Section 3.3. Representations; Warranties and Covenants of the Servicer............ 19 Section 3.4. Reports and Records for the Indenture Trustee; Bank Account Statements........................................................... 20 Section 3.5. Annual Servicer's Certificate........................................ 20 Section 3.6. Annual Independent Public Accountants' Servicing Report.............. 21 Section 3.7. Tax Treatment........................................................ 22 Section 3.8. Notices to Seller.................................................... 22 Section 3.9. Reports to the Commission............................................ 22 ARTICLE IV OTHER MATTERS RELATING TO SELLER 22 Section 4.1. Liability of Seller.................................................. 22 Section 4.2. Merger or Consolidation of, or Assumption of the Obligations of, Seller etc........................................................... 22 Section 4.3. Limitation on Liability of Seller.................................... 23
ARTICLE V OTHER MATTERS RELATING TO THE SERVICER................................................ 24 Section 5.1. Liability of the Servicer.............................................. 24 Section 5.2. Merger or Consolidation of, or Assumption of the Obligations of, the Servicer............................................................... 24 Section 5.3. Limitation on Liability of the Servicer and Others..................... 24 Section 5.4. Indemnification of the Issuer and the Owner Trustee.................... 25 Section 5.5. The Servicer Not to Resign............................................. 26 Section 5.6. Access to Certain Documentation and Information Regarding the Receivables............................................................ 26 Section 5.7. Delegation of Duties................................................... 26 Section 5.8. Examination of Records................................................. 26 ARTICLE VI INSOLVENCY EVENTS..................................................................... 27 Section 6.1. Rights upon the Occurrence of an Insolvency Event...................... 27 ARTICLE VII SERVICER DEFAULTS..................................................................... 27 Section 7.1. Servicer Defaults...................................................... 27 Section 7.2. Indenture Trustee to Act; Appointment of Successor..................... 29 Section 7.3. Notification to Noteholders............................................ 31 ARTICLE VIII TERMINATION........................................................................... 31 Section 8.1. Termination of Agreement............................................... 31 ARTICLE IX MISCELLANEOUS PROVISIONS.............................................................. 31 Section 9.1. Amendment; Waiver of Past Defaults..................................... 31 Section 9.2. Protection of Right, Title and Interest to Issuer...................... 33 Section 9.3. Governing Law.......................................................... 34 Section 9.4. Notices; Payments...................................................... 34 Section 9.5. Severability of Provisions............................................. 35 Section 9.6. Further Assurances..................................................... 35 Section 9.7. No Waiver; Cumulative Remedies......................................... 35 Section 9.8. Counterparts........................................................... 35 Section 9.9. Third-Party Beneficiaries.............................................. 36 Section 9.10. Actions by Noteholders................................................. 36 Section 9.11. Rule 144A Information.................................................. 36 Section 9.12. Merger and Integration................................................. 36 Section 9.13. No Bankruptcy Petition................................................. 36 Section 9.14. Rights of Indenture Trustee............................................ 37 Section 9.15. Rights of the Owner Trustee............................................ 37
EXHIBITS EXHIBIT A Form of Assignment of Receivables in Additional Accounts.............. A-1 EXHIBIT B Form of Reassignment of Receivables in Removed Accounts............... B-1 EXHIBIT C Form of Monthly Servicer's Certificate................................ C-1 EXHIBIT D Form of Annual Servicer's Certificate................................. D-1 EXHIBIT E Form of Annual Independent Public Accountants' Servicing Report....... E-1 EXHIBIT F-1 Form of Opinion of Counsel with Respect to Amendments................. F-1-1 EXHIBIT F-2 Form of Opinion of Counsel with Respect to Accounts................... F-2-1 EXHIBIT F-3 Provisions to be Included in Annual Opinion of Counsel................ F-3-1 SCHEDULES SCHEDULE 1 List of Accounts...................................................... 1-1
iv TRANSFER AND SERVICING AGREEMENT, dated as of March 1, 2001 (this "Agreement") between FIRST CONSUMERS NATIONAL BANK, a national banking --------- association, as Seller and Servicer, and FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, a trust organized under the laws of the State of Illinois, as Issuer. In consideration of the mutual agreements herein contained, each party agrees as follows for the benefit of the other parties, the Noteholders and any Series Enhancer to the extent provided herein, in the Indenture and in any Indenture Supplement: ARTICLE I DEFINITIONS Section 1.1. Definitions. Capitalized terms used herein and not otherwise ----------- defined herein are defined in Annex A to the Master Indenture, dated as of the ------- date hereof, between First Consumers Credit Card Master Note Trust and The Bank of New York. Section 1.2. Other Definitional Provisions. All terms defined directly or ----------------------------- by reference in this Agreement shall have the defined meanings when used in any certificate or other document delivered pursuant hereto unless otherwise defined therein. For purposes of this Agreement and all such certificates and other documents, unless the context otherwise requires: (a) accounting terms not otherwise defined in this Agreement, and accounting terms partly defined in this Agreement to the extent not defined, shall have the respective meanings given to them under generally accepted accounting principles; (b) terms defined in Article 9 of the UCC as in effect in the State of Illinois and not otherwise defined in this Agreement are used as defined in that Article; (c) any reference to each Rating Agency shall only apply to any specific rating agency if such rating agency is then rating any outstanding Series; (d) references to any amount as on deposit or outstanding on any particular date means such amount at the close of business on such day; (e) the words "hereof," "herein" and "hereunder" and words of similar import refer to this Agreement (or the certificate or other document in which they are used) as a whole and not to any particular provision of this Agreement (or such certificate or document); (f) references to any Section, Schedule or Exhibit are references to Sections, Schedules and Exhibits in or to this Agreement (or the certificate or other document in which the reference is made), and references to any paragraph, Section, clause or other subdivision within any Section or definition refer to such paragraph, subsection, clause or other subdivision of such Section or definition; (g) the term "including" means "including without limitation"; (h) references to any law or regulation refer to that law or regulation as amended from time to time and include any successor law or regulation; (i) references to any Person include that Person's 1 successors and assigns; and (j) headings are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof. Section 1.3. Monthly Allocation of Finance Charge Receivables. The ------------------------------------------------ amount of Finance Charge Receivables (excluding, in each case where such term is used in this Section 1.3, Discount Option Receivables) in all Accounts shall be ----------- determined as follows: (a) At the close of business on each Cycle Billing Date for any Cycle of which any Accounts are included in the Trust, the amount of Finance Charge Receivables of all Accounts in such Cycle shall be equal to the result of (A) the amount of Finance Charges charged to all Accounts in such Cycle on such date minus (B) the amount of Finance Charge Receivables on all Accounts in such Billing Cycle that have been charged off since the close of business on the preceding Cycle Billing Date. As of the end of each Monthly Period, the amount of Finance Charge Receivables for all Accounts shall equal (X) the sum of the amounts calculated pursuant to the preceding sentence for each Cycle of which Accounts are included in the Trust during that Monthly Period plus (Y) the Carry-Over Finance Charge Amount. (b) For each Business Day in each Monthly Period, the amount of Collections allocated to Finance Charge Receivables for all Accounts shall be all Collections available for allocation on that Business Day up to an amount equal to the quotient of the result determined pursuant to paragraph (a) above as of the end of the immediately preceding Monthly Period divided by the number of Business Days in such present Monthly Period; provided, however, that (A) the -------- ------- amount of Collections allocated to Finance Charge Receivables for all Accounts on the first Business Day of each Monthly Period shall equal the product of two times such quotient, (B) subject to clause (C) below, the amount of Collections allocated to Finance Charge Receivables for all Accounts on the last Business Day of each Monthly Period shall equal zero and (C) to the extent that the total Collections available for allocation on any Business Day (other than the last Business Day of a Monthly Period) is less than the amount that is to be allocated to Collections of Finance Charge Receivables on that Business Day, then the deficit shall be added to the amount of Collections that will be allocated to Finance Charge Receivables on the next Business Day. (c) If, at the close of business on the last Business Day of any Monthly Period, the amount of Collections allocated to Finance Charge Receivables for all Accounts during such Monthly Period is less than the amount of Finance Charge Receivables for all Accounts calculated pursuant to paragraph (a) as of the end of the next preceding Monthly Period, then such deficit shall be the "Carry-Over Finance Charge Amount" and shall be added to the amount of Finance Charge Receivables as of the end of the then current Monthly Period pursuant to paragraph (a). 2 Notwithstanding the foregoing, the Servicer may adopt a different method of determining the amount of Finance Charge Receivables which in the good faith judgment of the Servicer is designed to more accurately reflect the portions of Receivables and Collections constituting Finance Charge Receivables. ARTICLE II CONVEYANCE OF RECEIVABLES Section 2.1. Conveyance of Receivables. By execution of this Agreement, ------------------------- Seller does hereby transfer, assign, set over and otherwise convey to the Issuer, without recourse except as provided herein, all its right, title and interest in, to and under (a) the Collateral Certificate, and (b) effective on the FCMT Termination Date, the Receivables existing at the opening of business on the FCMT Termination Date, and thereafter created from time to time until the termination of the Issuer, all Collections and Recoveries allocable to the Issuer as provided herein, the rights to receive certain amounts paid or payable as Interchange (if and to the extent provided for in any Indenture Supplement), all rights to security for any Receivables (including without limitation rights to bank accounts or certificates of deposit pledged as collateral) and the right to any Enhancement with respect to any Series, in each case together with all monies due or to become due and all amounts received or receivable with respect thereto and all proceeds thereof and Insurance Proceeds relating thereto. Such property, together with all monies and other property credited to the Collection Account, the Series Accounts and the Excess Funding Account (including any subaccounts of any such account), the rights of the Issuer under this Agreement and the Trust Agreement and the right to receive Recoveries shall constitute the assets of the Issuer (the "Trust Assets"). The foregoing does not constitute and ------------ is not intended to result in the creation or assumption by the Issuer, the Owner Trustee, the Indenture Trustee or any Noteholder of any obligation of the Seller, the Servicer or any other Person in connection with the Accounts or the Receivables or under any agreement or instrument relating thereto, including any obligation to Obligors, merchant banks, merchants or clearance systems. On or prior to the Initial Closing Date, Seller shall deliver to the Owner Trustee a registered certificate representing the Collateral Certificate. On or prior to the FCMT Termination Date, Seller agrees to record and file, at its own expense, financing statements (and continuation statements when applicable) with respect to the Receivables conveyed by Seller existing on the FCMT Termination Date and thereafter created meeting the requirements of applicable state law in such manner and in such jurisdictions as are necessary to perfect, and maintain the perfection of, the transfer and assignment of its interest in such Receivables to the Issuer, and to deliver a file stamped copy of each such financing statement or other evidence of such filing to the Owner Trustee as soon as practicable after the FCMT Termination Date, and (if any additional filing is so necessary) as soon as practicable after the 3 applicable Addition Date, in the case of Receivables arising in Additional Accounts. The Owner Trustee shall be under no obligation whatsoever to file such financing or continuation statements or to make any other filing under the UCC in connection with such transfer and assignment. Seller further agrees, at its own expense, on or prior to (x) the FCMT Termination Date, (y) the applicable Addition Date, in the case of Additional Accounts (other than Additional Accounts added pursuant to Section 2.6(e)), and -------------- (z) the applicable Removal Date, in the case of Removed Accounts, (a) to indicate in the appropriate computer files that Receivables created (or reassigned, in the case of Removed Accounts) in connection with the Accounts have been conveyed to the Issuer pursuant to this Agreement (or conveyed to Seller or its designee in accordance with Section 2.7, in the case of Removed ----------- Accounts) and (b) to deliver to the Owner Trustee a computer file or microfiche list containing a true and complete list of all such Accounts specifying for each such Account, as of the FCMT Termination Date, the applicable Addition Date in the case of Additional Accounts, and the applicable Removal Date in the case of Removed Accounts, its account number and, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables outstanding in such Account. Each such file or list, as supplemented, from time to time, to reflect Additional Accounts and Removed Accounts, shall be marked as Schedule 1 ---------- to this Agreement and is hereby incorporated into and made a part of this Agreement. If the arrangements with respect to the Receivables hereunder shall constitute a loan and not a purchase and sale of such Receivables, it is the intention of the parties hereto that this Agreement shall constitute a security agreement under applicable law, and that Seller shall be deemed to have granted to the Issuer a first priority perfected security interest in all of Seller's right, title and interest, whether owned on the FCMT Termination Date or thereafter acquired, in, to and under the Receivables and the other Trust Assets conveyed by Seller, and all money, accounts, general intangibles, chattel paper, instruments, documents, goods, investment property, deposit accounts, certificates of deposit, letters of credit, and advices of credit consisting of, arising from or related to the Trust Assets, to secure its obligations hereunder. Seller acknowledges that all instruments (including certificates of deposit) and bank accounts the security interest in which has been transferred to the Issuer hereby and which are maintained with Seller or of which Seller has possession, shall be so maintained and held by Seller on behalf and for the benefit of the Issuer, in accordance with the terms of this Agreement. Additionally, for purposes of perfecting the Issuer's security interest in bank accounts pledged to Seller, which security interest Seller has transferred to the Issuer hereunder, this Agreement constitutes and shall be deemed (i) notice to Seller by the Issuer of the Issuer's security interest in such bank accounts, and (ii) Seller's 4 acknowledgment of and consent to the Issuer's notice and the Issuer's security interest in such bank accounts. Section 2.2. Acceptance by Issuer. -------------------- (a) The Issuer hereby acknowledges its acceptance of all right, title and interest to the property, now existing and hereafter created, conveyed to the Issuer pursuant to Section 2.1. The Owner Trustee shall maintain a copy of ----------- Schedule 1, as delivered from time to time, at its Corporate Trust Office. - ---------- (b) The Owner Trustee hereby agrees not to disclose to any Person any of the account numbers or other information contained in the computer files or microfiche lists marked as Schedule 1 and delivered to the Owner Trustee or the ---------- Issuer, from time to time, except (i) to a Successor Servicer or as required by a Requirement of Law applicable to the Owner Trustee, (ii) in connection with the performance of the Owner Trustee's or the Issuer's duties hereunder, (iii) to the Indenture Trustee in connection with its duties in enforcing the rights of Noteholders or (iv) to bona fide creditors or potential creditors of the Servicer or Seller for the limited purpose of enabling any such creditor to identify Receivables or Accounts subject to this Agreement. The Owner Trustee and the Issuer each agrees to take such measures as shall be reasonably requested by Seller to protect and maintain the security and confidentiality of such information and, in connection therewith, shall allow Seller or its duly authorized representatives to inspect the Owner Trustee's security and confidentiality arrangements as they specifically relate to the administration of the Issuer from time to time during normal business hours upon prior written notice. The Owner Trustee and the Issuer shall provide Seller with notice five (5) Business Days prior to disclosure of any information of the type described in this Section 2.2(b). -------------- Section 2.3. Representations and Warranties of Seller Relating to Seller. ----------------------------------------------------------- Seller hereby represents and warrants as of the Initial Closing Date that: (a) Organization and Good Standing. Seller is a national banking ------------------------------ association duly organized and validly existing in good standing under the laws of the United States of America, has FDIC deposit insurance and has full corporate power, authority and legal right to own its properties and conduct its business as such properties are presently owned and such business is presently conducted, and to execute, deliver and perform its obligations under this Agreement. (b) Due Qualification. Seller is qualified as a foreign banking ----------------- association or other entity in any state where it is required to be so qualified in order to conduct its business as required by this Agreement, and has obtained all necessary 5 licenses and approvals as required under federal and state law, in each case, where the failure to be so qualified, licensed or approved, could reasonably be expected materially and adversely to affect the ability of the Seller to comply with the terms of this Agreement. (c) Due Authorization. The execution and delivery of this Agreement and ----------------- the consummation of the transactions provided for herein have been duly authorized by Seller by all necessary corporate action on the part of Seller. This Agreement from the time of its execution shall remain an official record of the Seller. (d) No Conflict. The execution and delivery of this Agreement, the ----------- performance of the transactions contemplated by this Agreement and the fulfillment of the terms hereof will not conflict with, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time or both) a default under, any indenture, contract, agreement, mortgage, deed of trust, or other instrument to which Seller is a party or by which it or any of its property is bound. (e) No Violation. The execution and delivery of this Agreement, the ------------ performance of the transactions contemplated by this Agreement and the fulfillment of the terms hereof will not conflict with or violate any Requirements of Law applicable to Seller. (f) No Proceedings. There are no proceedings or investigations pending or, -------------- to the best knowledge of Seller, threatened against Seller, before any court, regulatory body, administrative agency, or other tribunal or governmental instrumentality (i) asserting the invalidity of this Agreement, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement, (iii) seeking any determination or ruling that, in the reasonable judgment of Seller, would materially and adversely affect the performance by Seller of its obligations under this Agreement, (iv) seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Agreement or (v) seeking to impose income taxes on the Issuer (other than as a wholly-owned subsidiary of Seller). (g) All Consents Required. All approvals, authorizations, consents, orders --------------------- or other actions of any Person or of any governmental body or official required in connection with the execution and delivery of this Agreement, the performance of the transactions contemplated by this Agreement, and the fulfillment of or terms hereof, have been obtained. (h) Bulk Sales. The execution, delivery and performance of this Agreement ---------- do not require compliance with any "bulk sales" law by Seller. 6 (i) Solvency. The transactions under this Agreement do not and will not -------- render Seller insolvent, nor have such transactions been entered into in contemplation of the Seller's insolvency. (j) Selection Procedures. No selection procedures believed by Seller to be -------------------- materially adverse to the interests of the Issuer or the Noteholders were utilized by Seller in selecting the Accounts. The representations and warranties set forth in this Section 2.3 shall survive ----------- the transfer of the Trust Assets to the Issuer. Upon discovery by Seller, the Servicer or the Owner Trustee of a breach of any of the foregoing representations and warranties, the party discovering such breach shall give prompt written notice to the others and any Enhancement Provider. Seller hereby represents and warrants, with respect to any Series, as of the Closing Date with respect to such Series, unless otherwise stated in the related Indenture Supplement, that the representations and warranties of Seller set forth in this Section 2.3 will be true and correct as of such date. - ----------- Section 2.4 Representations and Warranties of Seller Relating to this --------------------------------------------------------- Agreement and the Receivables. - ----------------------------- (a) Binding Obligation; Valid Transfer and Security Interest. Seller -------------------------------------------------------- hereby represents and warrants to the Issuer that, as of the Initial Closing Date and, with respect to any Series issued after the Initial Closing Date, unless otherwise stated in the related Indenture Supplement, as of the Closing Date for such Series: (i) This Agreement constitutes a legal, valid and binding obligation of Seller, enforceable against Seller in accordance with its terms, except as such enforceability may be limited by Debtor Relief Laws and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity). (ii) This Agreement constitutes either (A) a valid transfer to the Issuer of all right, title and interest of Seller in, to and under the Trust Assets, and such property will be held by the Issuer free and clear of any Lien of any Person claiming through or under Seller or its Affiliates, except for (w) the interests of the FCMT Trustee, the Indenture Trustee and the Noteholders, (x) Liens permitted under Section 2.5(b), (y) -------------- the Seller Interest and (z) Seller's right to receive interest accruing on, and investment earnings in respect of, the Collection Account or any Series Account as provided in the Transaction 7 Documents or (B) a grant of a security interest in such property to the Issuer, which is enforceable with respect to (i) upon execution and delivery of this Agreement, the Collateral Certificate, all monies due or to become due with respect thereto and other proceeds thereof, (ii) upon the FCMT Termination Date, the then existing Receivables, all monies due or to become due with respect thereto, the Collections, Recoveries and other proceeds thereof, and Insurance Proceeds relating thereto and (iii) thereafter, at the time new Receivables arise, with respect to such Receivables, all monies due or to become due with respect thereto, and the Collections, Recoveries and other proceeds thereof and Insurance Proceeds relating thereto. If this Agreement constitutes the grant of a security interest to the Issuer in such property, upon the filing of the financing statements described in Section 2.1 and in the case of the Receivables ----------- hereafter arising in the Accounts and proceeds thereof and Insurance Proceeds relating to such Receivables, as the same arise, the Issuer shall have a first priority perfected security interest in such property, except for Liens permitted under Section 2.5(b). Neither Seller nor any Person -------------- claiming through or under Seller shall have any claim to or interest in the Collection Account, the Excess Funding Account or any Series Account, except for Seller's right to receive interest accruing on, and investment earnings in respect of, the Collection Account, the Excess Funding Account or any Series Account, as provided in the Transaction Documents, Seller's right to receive payments from the Collection Account or any Series Account in accordance with the provisions of the Indenture, and, if this Agreement constitutes the grant of a security interest in such property, except for the interest of Seller in such property as a debtor for purposes of the UCC as in effect in the State of Illinois. (b) Eligibility of Receivables. As of the FCMT Termination Date, Seller -------------------------- agrees that all representations and warranties made by it with respect to any Account or Receivable pursuant to Section 2.4 of the Pooling and Servicing ----------- Agreement shall be deemed for all purposes (including the reassignment obligations under Section 2.4(e)) to have been made pursuant to this Agreement -------------- as of the day when each was made or deemed made, as if this Agreement had been in effect on that day. Thereafter, each day on which any new Receivable is transferred by Seller to the Issuer, Seller shall be deemed to represent and warrant to the Issuer that (i) each Receivable transferred on such day is an Eligible Receivable, (ii) each Receivable transferred on such day has been transferred to the Issuer free and clear of any Lien of any Person (other than Liens permitted under Section 2.5(b), the Seller Interest -------------- 8 and Seller's right to receive interest accruing on, and investment earnings in respect of, the Collection Account or any Series Account, as provided in the Transaction Documents) and in compliance, in all material respects, with all Requirements of Law applicable to Seller, (iii) with respect to each such Receivable, all consents, licenses, approvals or authorizations of or registrations or declarations with any Governmental Authority required to be obtained, effected or given by Seller in connection with the transfer of such Receivable to the Issuer have been duly obtained, effected or given and are in full force and effect and (iv) the representations and warranties set forth in Section 2.4(a) are true and correct with respect to each Receivable transferred - -------------- on such day as if made on such day. (c) Notice of Breach. The representations and warranties set forth in this ---------------- Section 2.4 shall survive the transfer of the respective Receivables to the - ----------- Issuer. Upon discovery by Seller, the Servicer or the Owner Trustee of a breach of any of the foregoing representations and warranties, the party discovering such breach shall give prompt written notice to the others and any Enhancement Provider. (d) Reassignment of Ineligible Receivables. -------------------------------------- (i) Reassignment of Receivables. In the event any representation or --------------------------- warranty contained in Section 2.4(b) is not true and correct in any material -------------- respect as of the date specified therein with respect to any Receivable or the related Account unless cured within sixty (60) days (or such longer period, not in excess of 120 days, as may be agreed to by the Indenture Trustee) after the earlier to occur of the discovery thereof by Seller or receipt by Seller of written notice thereof given by the Owner Trustee, the Indenture Trustee or the Servicer, then Seller shall accept reassignment of all Receivables in the related Account ("Ineligible Receivables") on the terms and conditions set forth ---------------------- in paragraph (ii) below. Notwithstanding anything contained in this Section ------- 2.4(d) to the contrary, in the event of breach of any representation and - ------ warranty set forth in Section 2.4(b) with respect to any Receivable having been -------------- conveyed to the Issuer free and clear of any Lien of any Person claiming through or under Seller and its Affiliates and in compliance in all material respects with all Requirements of Law applicable to Seller, immediately upon the earlier to occur of the discovery of such breach by Seller or receipt by Seller of written notice of such breach given by the Owner Trustee, the Indenture Trustee or the Servicer, Seller shall repurchase and the Owner Trustee shall convey, without recourse, representation or warranty, all of the Owner Trustee's right, title and interest in each Ineligible Receivable, and the Servicer shall promptly notify the Rating Agencies of such event. (ii) Price of Reassignment. The Servicer shall deduct the portion of such --------------------- Ineligible Receivables reassigned to the Seller which are Principal Receivables from 9 the aggregate amount of the Principal Receivables used to calculate the Seller Amount and the various Allocation Percentages. If the exclusion of an Ineligible Receivable from the calculation of the Seller Amount would cause the Seller Amount to be less than the Minimum Seller Amount, then Seller shall, on the date of retransfer of such Ineligible Receivable, make a deposit in the Collection Account (for allocation pursuant to the Indenture) in immediately available funds in an amount equal to the Shortfall Amount. The amounts so deposited are to be treated for all purposes hereof as Collections on such Ineligible Receivables. Upon reassignment of any Ineligible Receivable, the Issuer shall automatically and without further action be deemed to transfer, assign, set over and otherwise convey to Seller or its designee, without recourse, representation or warranty, all the right, title and interest of the Issuer in and to such Ineligible Receivable, all Recoveries related thereto, all monies and amounts due or to become due and all proceeds thereof and such reassigned Ineligible Receivable shall be treated by the Issuer as collected in full as of the date on which it was transferred. The obligation of Seller to accept reassignment of any Ineligible Receivables conveyed to the Issuer by Seller, and to make the deposits, if any, required to be made to the Collection Account as provided in this Section, shall constitute the sole remedy respecting the event giving rise to such obligation available to the Issuer, the Noteholders (or the Owner Trustee on behalf of the Noteholders) or any Series Enhancer. The Issuer shall execute such documents and instruments of transfer or assignment and take such other actions as shall reasonably be requested and provided by the Seller to effect the conveyance of such Ineligible Receivables pursuant to this Section ------- 2.4(d), but only upon receipt of an Officer's Certificate from Seller that - ------ states that all conditions set forth in this Section 2.5 have been satisfied. ----------- (e) Reassignment of Issuer Portfolio. If any representation or warranty of -------------------------------- a Seller set forth in Section 2.4(a) is not true and correct in any material -------------- respect and such breach has a material adverse effect on the Receivables or the availability of the proceeds thereof to the Issuer (which determination shall be made without regard to whether funds are then available pursuant to any Series Enhancement), then either the Owner Trustee, the Indenture Trustee or the Holders of Notes holding not less than 50% of the aggregate principal amount of all Outstanding Notes, by notice then given to Seller and the Servicer (and to the Owner Trustee and Indenture Trustee if given by the Noteholders), may direct Seller to accept a reassignment of the Receivables conveyed to the Issuer by Seller if such breach and any material adverse effect caused by such breach is not cured within sixty (60) days of such notice (or within such longer period, not in excess of 120 days, as may be specified in such notice), and upon those conditions Seller shall be obligated to accept such reassignment on the terms set forth below; provided, however, that the Receivables will not be reassigned -------- ------- to Seller if, on any day prior to the end of such 60-day or longer period (i) the relevant representation and warranty shall be true and correct in all material respects as if made on such day and (ii) Seller shall have delivered to the Owner Trustee a certificate of an authorized officer describing the nature of such 10 breach and the manner in which the relevant representation and warranty has become true and correct. Seller shall deposit in the Collection Account in immediately available funds not later than 1:00 p.m., New York City time, on the Transfer Date for the first Distribution Date following the Monthly Period in which such reassignment obligation arises, in payment for such reassignment, an amount equal to the sum of the amounts specified therefor with respect to each outstanding Series in the related Indenture Supplement. Notwithstanding anything to the contrary in this Agreement, such amounts shall be distributed to the Noteholders on such Distribution Date in accordance with the terms of each Indenture Supplement. If the Owner Trustee, the Indenture Trustee or the Noteholders give notice directing the Seller to accept a reassignment of the Receivables as provided above, the obligation of Seller to accept such reassignment pursuant to this Section 2.4(e) and to make the deposit required to be made to the Collection - -------------- Account as provided in this paragraph shall constitute the sole remedy respecting an event of the type specified in the first sentence of this Section ------- 2.4(e) available to the Noteholders (or the Owner Trustee or Indenture Trustee - ------ on behalf of the Noteholders) or any Series Enhancer. Upon reassignment of the Receivables on such Distribution Date, the Issuer shall automatically and without further action be deemed to sell, transfer, assign, set-over and otherwise convey to the Seller, without recourse, representation or warranty, all the right, title and interest of the Issuer in and to the Receivables and Recoveries allocable to the Issuer, and all monies and amounts due or to become due with respect thereto and all proceeds thereof. The Issuer shall execute such documents and instruments of transfer or assignment and take such other actions as shall reasonably be requested by the Seller to effect the conveyance of such property pursuant to this Section. Section 2.5. Covenants of Seller. Seller hereby covenants that: ------------------- (a) Receivables to be General Intangibles or Accounts. Seller will take ------------------------------------------------- no action to cause any Receivable to be characterized as anything other than a "general intangible" or an "account" (as defined in the UCC as in effect in the State of Illinois). Each Receivable shall be payable pursuant to a contract which does not create a Lien on any goods purchased thereunder. (b) Security Interests. Except for the transfers hereunder and under the ------------------ Transfer and Servicing Agreement, Seller will not sell, pledge, assign or transfer to any other Person, or grant, create, incur, assume or suffer to exist any Lien on any Receivable, whether now existing or hereafter transferred to the Issuer, or any interest therein. Seller will immediately notify the Owner Trustee of the existence of any Lien on any Receivable; and Seller shall defend the right, title and interest of the Issuer in, to and under the Receivables, whether now existing or hereafter transferred to the Issuer, against all claims of third parties; provided, however, that nothing in this Section 2.5(b) shall -------- ------- -------------- prevent or be deemed to prohibit Seller from suffering to exist upon any of the Receivables any Liens for state, municipal or other local taxes if such 11 taxes shall not at the time be due and payable or if Seller shall currently be contesting the validity thereof in good faith by appropriate proceedings and shall have set aside on its books adequate reserves with respect thereto; provided further, however, that nothing in this Section 2.5(b) shall prevent or - -------- ------- ------- -------------- be deemed to prohibit Seller from granting a participation interest in the Seller Interest. (c) Account Allocations. If Seller is unable for any reason to transfer ------------------- Receivables to the Issuer in accordance with the provisions of this Agreement (including by reason of the occurrence of an Insolvency Event) then Seller agrees that, solely for purposes of payments under this Agreement, it shall in any such event allocate, after the occurrence of such event, payments on each Account with respect to the principal balance of such Account first to the oldest principal balance of such Account (it being understood that the foregoing allocation does not affect, with respect to any obligor, the priority of application of cardholder payments provided for in the related Cardholder Agreement(s)) and to have such payments applied as Collections in accordance with the Indenture. The parties hereto agree that Finance Charge Receivables, whenever created, accrued in respect of Principal Receivables which have been conveyed to the Issuer, or which would have been conveyed to the Issuer but for the above described inability to transfer such Receivables, shall continue to be a part of the Issuer notwithstanding any cessation of the transfer of additional Principal Receivables to the Issuer and Collections with respect thereto shall continue to be allocated and paid in accordance with the Indenture. (d) Delivery of Collections. Seller agrees to pay to the Servicer (if the ----------------------- Servicer is not then First Consumers National Bank) promptly (but in no event later than two Business Days after receipt) all Collections received by Seller in respect of the Receivables. (e) Finance Charges and Other Fees. Seller agrees that, except as ------------------------------ otherwise required by any Requirement of Law or as is deemed by Seller to be advisable for its MasterCard and VISA programs based on a good faith assessment by Seller of the various factors impacting the use of its MasterCard and VISA cards, Seller shall not reduce at any time (i) the Finance Charges assessed in respect of any Accounts, or (ii) any other fees charged on any of the Accounts if, as a result of such reduction, Seller's reasonable expectation of the Portfolio Yield in respect of any Series as of such date would be less than the current Base Rate applicable to such Series. (f) Cardholder Agreements and Cardholder Guidelines. Seller agrees to ----------------------------------------------- comply with and perform its obligations under the Cardholder Agreements relating to the Accounts and the Cardholder Guidelines, except insofar as any failure so to comply or conform would not materially and adversely affect the rights of the Issuer or the Noteholders or under the Transaction Documents. In that regard, except as aforesaid, and so long as such changes are made applicable to the comparable segments of those MasterCard and VISA accounts owned and serviced by the 12 Servicer which have characteristics the same as, or substantially similar to, the Accounts which are subject hereto (if any), Seller shall be free to change the terms and provisions of such Cardholder Agreements or the Cardholder Guidelines in any respect (including, without limitation, the calculation of the amount, or the timing, of charge offs). FCNB shall provide to each Rating Agency written notice of any such change that (i) lowers the periodic finance charge rate used to calculate Finance Charges on any Account or changes the minimum monthly payment applicable to any Account; (2) changes any periodic finance charge rate used to calculate Finance Charges on any Account from a floating rate to a fixed rate or from a fixed rate to a floating rate; (3) reduces any Cardholder Fees, Cash Advance Fees or other fees applicable to any Account or (4) changes the calculation of the amount, or the timing, of charge offs. (g) Sale Treatment. Seller agrees to treat the conveyance of Receivables -------------- hereunder as a sale for accounting purposes. Section 2.6. Addition of Accounts. -------------------- (a) If, on any day after the FCMT Termination Date, the Aggregate Principal Balance is less than the Minimum Aggregate Principal Balance, either Seller or the Servicer (whichever shall first become aware of same) promptly shall give the Owner Trustee written notice thereof, and as soon as practicable (but in no event later than 10 days thereafter) Seller shall designate additional Eligible Accounts ("Additional Accounts") to be included as Accounts ------------------- and shall transfer the Receivables in such Additional Accounts to the Issuer, in a sufficient amount so that the Aggregate Principal Balance on such day would have, if the Receivables from such Additional Accounts had been transferred to the Issuer on or prior to such day, at least equaled the Minimum Aggregate Principal Balance. (b) In addition to its obligation under Section 2.6(a), Seller may, but -------------- shall not be obligated to, from time to time, designate Additional Accounts to be included as Accounts, so long as after giving effect to such addition not more than 20% of the Receivables, by outstanding balance, will be 30 or more days delinquent (and for this purpose, Receivables in an Account shall be considered delinquent if less than 100% of a required payment was received). (c) Seller agrees that any Receivables from Additional Accounts shall be transferred by Seller to the Issuer under Section 2.6(a), (b) or (e) upon and -------------- --- --- subject to the following conditions: (i) On or before the fifth Business Day (the "Notice Date") prior to ----------- the Addition Date in respect of Additional Accounts added pursuant to Section 2.6(a) or (b), Seller shall give the Owner Trustee and the Servicer -------------- --- (if 13 a Person other than Seller) written notice that such Additional Accounts will be included and specifying the approximate aggregate amount of the Receivables to be transferred; (ii) Seller (A) shall transfer to the Issuer Receivables only in Eligible Accounts, and (B) shall, if such designation of Additional Accounts is made pursuant to Section 2.6(b) or (e) and if the addition of -------------- --- such Additional Accounts (1) would cause the quotient (the "Annual Quotient") of (x) the --------------- sum of the Annual Account Additions after giving effect to such addition, plus the related Base Amount, divided by (y) the related Base Amount to exceed 1.20, or (2) would cause the quotient (the "Quarterly Quotient") of (x) ------------------ the sum of the Quarterly Account Additions after giving effect to such addition plus the related Base Amount divided by (y) the related Base Amount to exceed 1.15; in either case, deliver a letter from each Rating Agency to the Indenture Trustee by the Addition Date confirming that the Rating Agency Condition has been satisfied with respect to the addition of such Additional Accounts; (iii) On or prior to the Addition Date, in respect of Additional Accounts added pursuant to Section 2.6(a) or (b), Seller shall have -------------- -- delivered to the Owner Trustee a written Assignment Agreement (including an acceptance by the Owner Trustee on behalf of the Issuer for the benefit of the Noteholders) in substantially the form of Exhibit A (the "Assignment --------- ---------- Agreement") and shall have indicated in its books and records, including --------- the computer files of the Receivables, that the Receivables created in connection with the Additional Accounts have been transferred by Seller to the Issuer; and shall have delivered to the Owner Trustee a computer file or microfiche list containing a true and complete list of all Additional Accounts identified by account number, and the aggregate amount of the Receivables and the aggregate amount of Principal Receivables in such Additional Accounts, as of the Addition Date in respect of Additional Accounts added pursuant to Section 2.6(a) or (b), which computer file or -------------- --- microfiche list shall be marked as Schedule 1 to the Assignment Agreement, ---------- delivered to the Owner Trustee as confidential and proprietary, shall be as of the date of such Assignment Agreement and incorporated into and made a part of such Assignment Agreement and this Agreement; (iv) Seller shall be deemed to represent and warrant that (x) each Additional Account is, as of the Addition Date, an Eligible Account, (y) no selection procedures reasonably believed by Seller to be materially adverse 14 to the interests of the Noteholders were utilized in selecting the Additional Accounts from the available Eligible Accounts, and (z) as of the Addition Date, Seller is not insolvent and will not be rendered insolvent by adding any such Additional Account; (v) Seller shall be deemed to represent and warrant that, as of the Addition Date, the Assignment Agreement constitutes either (x) a valid transfer to the Issuer of all right, title and interest of Seller in, to and under the Receivables then existing and thereafter arising in respect of the Additional Accounts, all monies due or to become due with respect thereto (including all Finance Charge Receivables), and all proceeds of such Receivables and Insurance Proceeds relating thereto, and such property will be owned by the Issuer free and clear of any Lien of any Person, except for (i) Liens permitted under Section 2.5(b), (ii) the Seller -------------- Interest and (iii) Seller's right to receive interest accruing on, and investment earnings in respect of, the Collection Account or any Series Account, as provided in this Agreement and any Indenture Supplement, or (y) a grant of a security interest in such property to the Issuer, which is enforceable with respect to then existing Receivables of the Additional Accounts, all monies due or to become due with respect thereto, the proceeds thereof and Recoveries and Insurance Proceeds relating thereto upon the transfer of such Receivables to the Issuer, and which will be enforceable with respect to the Receivables thereafter transferred in respect of Additional Accounts, the proceeds thereof and Insurance Proceeds relating thereto upon such transfer; and (z) if the Assignment Agreement constitutes the grant of a security interest to the Issuer in such property, upon the filing of a financing statement as described in Section ------- 2.1 with respect to such Additional Accounts and in the case of the --- Receivables of Additional Accounts thereafter transferred and the proceeds thereof, and Insurance Proceeds relating to such Receivables, upon such transfer, the Issuer shall have a first priority perfected security interest in such property, except for Liens permitted under Section 2.5(b), -------------- the Seller Interest and Seller's right to receive interest accruing on, and investment earnings in respect of, the Collection Account or any Series Account, as provided in this Agreement and any Indenture Supplement; (vi) Seller shall, on the Addition Date for Additional Accounts added pursuant to Section 2.6(a) or (b), deliver a certificate of a Vice -------------- --- President or more senior officer confirming the items set forth in paragraphs (ii), (iii), (iv) and (v) above; and ---- ----- ---- --- (vii) Seller shall, on the Addition Date for Additional Accounts added pursuant to Section 2.6(a) or (b), deliver an Opinion of Counsel with -------------- --- respect to the Receivables in the Additional Accounts to the Owner Trustee substantially in the form of Exhibit F-2, and which shall be reasonably ----------- acceptable to the Rating Agencies. 15 (d) Seller shall provide to each Rating Agency and to each Enhancement Provider prior written notice each time Additional Accounts are added pursuant to Section 2.6(a) or (b). -------------- --- (e) In addition to the occasional designation of Additional Accounts as required or permitted pursuant to Sections 2.6(a) and (b), Seller agrees that --------------- --- each new MasterCard or VISA account originated in the normal course of Seller's business after the FCMT Termination Date shall automatically be included as an Account (and the Receivables arising thereunder automatically transferred to the Issuer) effective on the date on which such account is created; provided, -------- however, that such automatic inclusion and transfer shall not occur with respect - ------- to any such account if: (i) such account does not qualify as an Eligible Account, (ii) the transfer to the Issuer of the Receivables in such Account, if such Accounts had been designated by Seller pursuant to Section 2.6(b), would -------------- have caused the limitations set forth in Section 2.6(c)(ii) to be exceeded ------------------ (unless there shall have been delivered to the Indenture Trustee a letter from each Rating Agency confirming the Rating Agency Condition has been satisfied with respect to the addition of such Additional Account), or (iii) Seller otherwise designates such account as an account which is not to be included as an Account pursuant to this Section 2.6(e). On or before the fifth Business Day -------------- of each month next succeeding a calendar month in which Accounts were included pursuant to the preceding sentence, Seller shall indicate in its computer files of the receivables that the Receivables created in connection with such included Accounts have been transferred to the Issuer. Seller, at its option, may, by providing written notice to the Owner Trustee and the Servicer, terminate or suspend the inclusion of Additional Accounts added pursuant to Section 2.6(e) at -------------- any time. Section 2.7. Removal of Accounts. ------------------- (a) Subject to the conditions set forth below, after the FCMT Termination Date, Seller may designate from time to time Accounts no longer to be designated for inclusion in the Issuer (the "Removed Accounts"); provided, however, that ---------------- -------- ------- Seller shall not make more than one such designation in any Monthly Period. On or before the fifth Business Day (the "Removal Notice Date") prior to the date ------------------- on which Removed Accounts shall be designated (the "Removal Date"), Seller shall ------------ give the Owner Trustee, the Servicer and each Enhancement Provider written notice that the Receivables from such Removed Accounts are to be retransferred to Seller. (b) Seller shall be permitted to designate and require retransfer to it of the Receivables from Removed Accounts only upon satisfaction of the following conditions: 16 (i) If the Accounts to be removed have outstanding Receivables, Seller shall satisfy the Rating Agency Condition with respect thereto by such Removal Date; (ii) on each Removal Date, the Owner Trustee shall deliver to Seller a written Reassignment Agreement in substantially the form of Exhibit B --------- (the "Reassignment Agreement") prepared by Seller, and Seller shall deliver ---------------------- to the Owner Trustee a computer file, microfiche or written list containing a true and complete schedule identifying all Removed Accounts specifying for each such Removed Account, as of the Removal Notice Date, its account number and the Receivable balance thereof. Such computer file, microfiche or written list shall be as of the date of such Reassignment Agreement incorporated into and made a part of this Agreement; (iii) Seller shall represent and warrant as of each Removal Date that (A) the list of Removed Accounts, as of the Removal Notice Date, complies in all material respects with the requirements of (ii) above; (B) Accounts (or administratively convenient groups of Accounts, such as billing cycles) were chosen for removal randomly or otherwise not on a basis intended to select particular accounts or groups of accounts for any reason other than administrative convenience, and no selection procedure used by Seller which is adverse to the interests of the Noteholders was utilized in selecting the Removed Accounts; and (C) as of the Removal Notice Date and as of the Removal Date, Seller is not insolvent and such removal was not made in contemplation of the Seller's insolvency; (iv) The removal of any Receivables of any Removed Accounts on any Removal Date shall not, in the reasonable belief of Seller, cause a Pay Out Event to occur, or an event which with notice or lapse of time or both would constitute a Pay Out Event; (v) The Aggregate Principal Balance shall not be less than the Minimum Aggregate Principal Balance after giving effect to such removal; (vi) Seller shall have delivered to the Owner Trustee and to each Enhancement Provider a certificate of an officer of 17 Seller confirming the items set forth in (i) through (v) above. The Owner Trustee may conclusively rely on such certificate, shall have no duty to make inquiries with regard to the matters set forth therein and shall incur no liability in so relying; and (vii) such other conditions and restrictions as may at any time be specified in an Officer's Certificate of the Seller delivered to the Owner Trustee shall have been satisfied, it being understood that (i) no such additional conditions or restrictions may conflict with or override any of the conditions and restrictions specified above, and (ii) upon delivery of such an Officer's Certificate to the Owner Trustee, the additional conditions and restrictions specified therein shall be deemed to be incorporated by reference into and become a part of this Agreement. Upon satisfaction of the above conditions, the Owner Trustee shall execute and deliver the Reassignment Agreement to Seller, and the Receivables from the Removed Accounts shall no longer constitute a part of the Issuer. (d) On and after the FCMT Termination Date, on the date on which an Account becomes a Defaulted Account, the Trust shall automatically and without further action or consideration be deemed to transfer, set over, and otherwise convey to the Seller, without recourse, representation or warranty, all the right, title and interest of the Trust in and to the Receivables in such Defaulted Account, all monies due or to become due with respect thereto, all proceeds of such Receivables allocable to the Trust with respect to such Receivable, excluding Recoveries relating thereto, which shall remain a part of the Trust Assets. Section 2.8. Discount Option. (a) Seller shall have the option to --------------- designate at any time and from time to time a percentage or percentages, which may be a fixed percentage or a variable percentage based on a formula (the "Discount Percentage"), of all or any specified portion of Principal Receivables ------------------- created after the Discount Option Date to be treated as Finance Charge Receivables ("Discount Option Receivables"). Seller shall also have the option --------------------------- of reducing or withdrawing the Discount Percentage, at any time and from time to time, on and after such Discount Option Date. Seller shall provide to the Servicer, the Owner Trustee and any Rating Agency 30 days' prior written notice of the Discount Option Date, and such designation shall become effective on the Discount Option Date (i) unless such designation in the reasonable belief of Seller would cause a Pay Out Event with respect to any series to occur, or an event 18 which, with notice or lapse of time or both, would constitute a Pay Out Event with respect to any Series or (ii) unless the Rating Agency Condition shall not have been satisfied with respect to such designation; provided that for this -------- purpose Moody's shall not be deemed to be a "Rating Agency." (b) After the Discount Option Date, Seller shall treat Discount Option Receivable Collections as Collections of Finance Charge Receivables. ARTICLE III ADMINISTRATION AND SERVICING OF RECEIVABLES Prior to the FCMT Termination Date, the Receivables shall be serviced as provided in the Pooling and Servicing Agreement, and this Article III will have ----------- no effect. On and after the FCMT Termination Date: Section 3.1. Acceptance of Appointment and Other Matters Relating to the ----------------------------------------------------------- Servicer. - -------- (a) Seller agrees to act as the Servicer under this Agreement. The Noteholders by their acceptance of the Notes consent to FCNB's acting as Servicer. (b) Subject to the provisions of this Agreement, the Servicer shall service and administer the Receivables and shall collect payments due under the Collateral Certificate and the Receivables in accordance with its customary and usual servicing procedures for servicing credit card receivables comparable to the Receivables and in accordance with the Cardholder Guidelines and shall have full power and authority, acting alone or through any party properly designated by it hereunder, to do any and all things in connection with such servicing and administration which it may deem necessary or desirable. Without limiting the generality of the foregoing and subject to Section 7.1, the Servicer is hereby ----------- authorized and empowered (i) unless such power and authority is revoked by the Indenture Trustee on account of the occurrence of a Servicer Default pursuant to Section 7.1, to make withdrawals from the Collection Account as set forth in - ----------- this Agreement, (ii) unless such power and authority is revoked by the Indenture Trustee on account of the occurrence of a Servicer Default pursuant to Section ------- 7.1, to instruct the Indenture Trustee to make withdrawals and payments from the - --- 19 Series Accounts in accordance with such instructions as set forth in this Agreement, (iii) unless such power and authority is revoked by the Indenture Trustee on account of the occurrence of a Servicer Default pursuant to Section ------- 7.1, to instruct the Indenture Trustee in writing as provided herein, and (iv) - --- unless such power and authority is revoked by the Indenture Trustee on account of the occurrence of a Servicer Default pursuant to Section 7.1, to execute and ----------- deliver, on behalf of the Issuer for the benefit of the Noteholders, any and all instruments of satisfaction or cancellation, or of partial or full release or discharge, and all other comparable instruments, with respect to the Receivables and, after the delinquency of any Receivable and to the extent permitted under and in compliance with applicable law and regulations, to commence enforcement proceedings with respect to such Receivables. The Owner Trustee shall furnish the Servicer with any powers of attorney and other documents necessary or appropriate to enable the Servicer to carry out its servicing and administrative duties hereunder. (c) If Seller is unable for any reason to transfer Receivables to the Issuer in accordance with the provisions of this Agreement (including by reason of the occurrence of an Insolvency Event), the Servicer agrees to allocate and pay to the Issuer, after such date, all Collections as contemplated by Section ------- 2.5(c). - ------ (d) The Servicer shall not be obligated to use separate servicing procedures, offices, employees or accounts for servicing the Receivables from the procedures, offices, employees and accounts used by the Servicer in connection with servicing other credit card receivables. (e) The Servicer shall maintain fidelity bond coverage insuring against losses through wrongdoing of its officers and employees who are involved in the servicing of credit card receivables. Section 3.2. Servicing Compensation. As compensation for its servicing ---------------------- activities hereunder and reimbursement for its expenses as set forth in the immediately following paragraph, the Servicer shall be entitled to receive a monthly servicing fee in respect of any Monthly Period (or portion thereof) prior to the termination of the Issuer pursuant to the Indenture (the "Monthly ------- Servicing Fee"). The share of the Monthly Servicing Fee allocable to each Series - ------------- of Notes with respect to any Monthly Period (or portion thereof) shall be payable on the related Distribution Date and, with respect to each Series (unless provided in the related Indenture Supplement), shall be equal to the 20 amount specified in the related Indenture Supplement (the "Investor Monthly ---------------- Servicing Fee"). The share of the Monthly Servicing Fee allocable to the Holder - ------------- of the Seller Interest with respect to any Monthly Period (or portion thereof) shall be equal to one-twelfth of the product of (A) Seller Amount minus the sum of the Excess Funding Amount and the balance on deposit in the Principal Collections Subaccount, and (B) the weighted average of the Servicing Fee Rates with respect to each Series of Notes then outstanding (the "Monthly Seller -------------- Servicing Fee"). The Monthly Servicing Fee shall equal the sum of (x) the - ------------- aggregate amount of Investor Monthly Servicing Fees with respect to each Series then outstanding and (y) the Monthly Seller Servicing Fee. The Investor Monthly Servicing Fee with respect to any Series is payable in arrears on the related Distribution Date (unless otherwise provided in the related Indenture Supplement) and the Monthly Seller Servicing Fee is payable in arrears no later than the last Distribution Date with respect to any Series occurring in a Monthly Period. The Monthly Seller Servicing Fee and, unless otherwise provided in an Indenture Supplement, each Investor Monthly Servicing Fee, shall be calculated on the basis of a 360-day year consisting of twelve 30-day months. The Servicer's expenses include the reasonable fees and disbursements of independent accountants and all other expenses incurred by the Servicer in connection with its activities hereunder; provided that the Servicer shall not -------- be liable for any liabilities, costs or expenses of the Issuer, the Noteholders or the Note Owners arising under any tax law, including any federal, state or local income or franchise taxes or any other tax imposed on or measured by income (or any interest or penalties with respect thereto or arising from a failure to comply therewith). The Servicer shall be required to pay such expenses for its own account and shall not be entitled to any payment therefor other than the Monthly Servicing Fee. Section 3.3. Representations; Warranties and Covenants of the Servicer. --------------------------------------------------------- Seller, as initial Servicer, hereby makes, and any successor Servicer by its appointment hereunder shall make, the following representations and warranties and covenants on which the Owner Trustee has relied in accepting the Receivables in trust and in authenticating Notes: (a) Organization and Good Standing. The Servicer is duly organized, validly ------------------------------ existing and in good standing under the laws of its jurisdiction of organization, and has full corporate power, authority and right to own its properties and conduct its business as such properties are presently owned and such business is presently conducted, and to execute, deliver and perform its obligations under this Agreement. (b) Due Qualification. The Servicer is qualified as a foreign banking ----------------- association or other entity in any state where it is required to be so qualified to 21 service the Receivables as required by this Agreement and has obtained all necessary licenses and approvals as required under federal and state law, in each case, where the failure to be so qualified, licensed or approved, could reasonably be expected materially and adversely to affect the ability of the Servicer to comply with the terms of this Agreement. (c) Due Authorization. The execution, delivery, and performance of this ----------------- Agreement have been duly authorized by the Servicer by all necessary corporate action on the part of the Servicer. (d) Binding Obligation. This Agreement constitutes the legal, valid and ------------------ binding obligations of the Servicer, enforceable in accordance with its terms, except as enforceability may be limited by Debtor Relief Laws and except as such enforceability may be limited by general principles of equity (whether considered in a proceeding at law or in equity). (e) No Violation. The execution and delivery of this Agreement by the ------------ Servicer, and the performance of the transactions contemplated by this Agreement and the fulfillment of the terms hereof applicable to the Servicer, will not conflict with, violate, result in any breach of any of the terms and provisions of, or constitute (with or without notice or lapse of time or both) a default under, any Requirements of Law applicable to the Servicer or any indenture, contract, agreement, mortgage, deed of trust or other instrument to which the Servicer is a party or by which it is bound. (f) No Proceedings. There are no proceedings or investigations pending or, -------------- to the best knowledge of the Servicer, threatened against the Servicer before any court, regulatory body, administrative agency or other tribunal or governmental instrumentality seeking to prevent the consummation of any of the transactions contemplated by this Agreement, seeking any determination or ruling that, in the reasonable judgment of the Servicer, would materially and adversely affect the performance by the Servicer of its obligations under this Agreement, or seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Agreement. (g) Rescission and Cancellation. Other than pursuant to and in accordance --------------------------- with the Cardholder Guidelines, the Servicer shall not rescind or cancel any Receivable unless such rescission or cancellation shall have been ordered or directed by a Governmental Authority. (h) Other Actions. Other than pursuant to and in accordance with the ------------- Cardholder Guidelines and as otherwise specifically permitted by this Agreement, the Servicer shall not (i) take or fail to take any action if such action or failure to act would impair the rights of the Issuer in any Receivable, or (ii) revise or defer any payment due in respect of any Receivable. 22 Section 3.4. Reports and Records for the Indenture Trustee; Bank Account ----------------------------------------------------------- Statements. - ---------- (a) Daily Reports. On each Business Day, the Servicer shall prepare and ------------- make available at the office of the Servicer for inspection by the Indenture Trustee a record setting forth (i) the aggregate amount of Collections processed by the Servicer on the preceding Business Day and (ii) the aggregate amount of Receivables as of the close of business on the preceding Business Day. (b) Monthly Servicer's Certificate. Unless otherwise stated in the related ------------------------------ Indenture Supplement with respect to any Series, on each Determination Date, the Servicer shall forward to the Indenture Trustee, the Paying Agent, any Rating Agency and any Enhancement Provider a certificate of a Servicing Officer substantially in the form of Exhibit C. --------- Section 3.5. Annual Servicer's Certificate. Unless the Servicer has been ----------------------------- relieved of all of its obligations under this Agreement because the final Series has been repaid during the prior calendar year, the Servicer will deliver to the Indenture Trustee, any Enhancement Provider and any Rating Agency on or before April 30 of each calendar year, beginning with April 30, 2002, an Officer's Certificate substantially in the form of Exhibit D stating that (a) a review of --------- the activities of the Servicer during the preceding calendar year (or, with respect to the certificate to be delivered on April 30, 2002, since the Issuer's inception) and of its performance under this Agreement was made under the supervision of the officer signing such certificate and (b) to the best of such officer's knowledge, based on such review, the Servicer has fully performed all its obligations under this Agreement throughout such period, or, if there has been a default in the performance of any such obligation, specifying each such default known to such officer and the nature and status thereof. A copy of such certificate may be obtained by any Noteholder by a request in writing to the Indenture Trustee addressed to the Corporate Trust Office. Section 3.6. Annual Independent Public Accountants' Servicing Report. ------------------------------------------------------- (a) Unless the Servicer has been relieved of all of its obligations under this Agreement because the final Series has been repaid during the prior calendar year, on or before April 30 of each calendar year after the year during which the FCMT Termination Date occurs, the Servicer shall cause KPMG Peat Marwick or another firm of nationally recognized independent public accountants (who may also render other services to the Servicer or Seller) to furnish a report covering the preceding annual period to the effect that such accountants have applied certain agreed-upon procedures to certain documents and records relating to the servicing of Accounts under this Agreement (and Pooling and Servicing Agreement, if applicable), compared the 23 information contained in the Servicer's certificates (excluding Servicer's certificates for any Series that has been repaid during the prior calendar year) delivered during the period covered by such report (which shall be the period from January 1, to and including December 31 of such calendar year) with such documents and records in each case as specified in Exhibit E and that no matters --------- came to the attention of such accountants that caused them to believe that such servicing was not conducted in compliance with Sections 3.1 and of this ------------ Agreement and Article VIII of the Indenture, except for such exceptions as such accountants shall believe to be immaterial and such other exceptions as shall be set forth in such statement. In addition, each report shall set forth the agreed-upon procedures performed. A copy of such report may be obtained by any Noteholder by a request in writing to the Indenture Trustee addressed to the Corporate Trust Office. In addition, the Servicer shall cause such accountants to furnish a copy of such report to each Rating Agency and to each Enhancement Provider. (b) On or before April 30 of each calendar year, beginning with April 30, 2002, the Servicer shall cause KPMG Peat Marwick or another firm of nationally recognized independent public accountants (who may also render other services to the Servicer or Seller) to furnish a report to the Indenture Trustee to the effect that they have compared the mathematical calculations of each amount set forth in the monthly certificates forwarded by the Servicer pursuant to Section ------- 3.4(b) during the period covered by such report (which shall be the period from - ------ January 1, to and including December 31 of such calendar year) with the Servicer's computer reports which were the source of such amounts and that on the basis of such comparison, such accountants are of the opinion that such amounts are in agreement, except for such exceptions as they believe to be immaterial and such other exceptions as shall be set forth in such statement. A copy of such report may be obtained by any Noteholder by a request in writing to the Owner Trustee addressed to the Corporate Trust Office. In addition, the Servicer shall cause such accountants to furnish a copy of such report to each Rating Agency and to each Enhancement Provider. Section 3.7. Tax Treatment. Seller has structured this Agreement and the ------------- Notes to facilitate a secured, credit-enhanced financing on favorable terms with the intention that the Notes will constitute indebtedness of Seller for federal income and state and local tax purposes; and Seller and each Noteholder by acceptance of its Note agrees to recognize and report the Notes as indebtedness of 24 Seller for purposes of federal, state and local income or franchise taxes and any other tax imposed on or measured by income, and to report all receipts and payments relating thereto in a manner that is consistent with such characterization. Section 3.8. Notices to Seller. In the event that Seller is no longer ----------------- acting as Servicer, any Successor Servicer appointed pursuant to Section 7.2 ----------- shall deliver or make available to Seller each certificate and report required to be prepared, forwarded or delivered thereafter pursuant to Sections 3.4, 3.5 ------------ --- and 3.6. --- Section 3.9. Reports to the Commission. The Servicer shall, on behalf of ------------------------- the Issuer, cause to be filed with the Commission any periodic reports required to be filed under the provisions of the Securities Exchange Act of 1934, and the rules and regulations of the Commission thereunder. Seller shall, at its own expense, cooperate in any reasonable request of the Servicer in connection with such filings. The Issuer agrees to cooperate with the Servicer in connection with such filings. ARTICLE IV OTHER MATTERS RELATING TO SELLER Section 4.1. Liability of Seller. Seller shall be liable in accordance ------------------- herewith to the extent, and only to the extent, of the obligations specifically undertaken by Seller hereunder. Section 4.2. Merger or Consolidation of, or Assumption of the Obligations ------------------------------------------------------------ of, Seller etc. - --------------- (a) Seller shall not consolidate with or merge into any other Person or convey or transfer its properties and assets substantially as an entirety to any Person, unless: (i) the Person formed by such consolidation or into which Seller is merged or the Person which acquires by conveyance or transfer the properties and assets of Seller substantially as an entirety shall be, if Seller is not the surviving entity, organized and existing under the laws of the United States of America or any State or the District of Columbia and shall be a national banking association, federal savings association, state banking corporation or state savings association which is not subject to the bankruptcy laws of the United States of America and shall expressly assume, by an agreement supplemental hereto, executed and delivered to the Owner Trustee, in form satisfactory to the Owner Trustee, the performance of every covenant and obligation of Seller, as applicable 25 hereunder, and shall benefit from all the rights granted to Seller, as applicable hereunder. To the extent that any right, covenant or obligation of Seller, as applicable hereunder, is inapplicable to the successor entity, such successor entity shall be subject to such covenant or obligation, or benefit from such right, as would apply, to the extent practicable, to such successor entity. In furtherance hereof, in applying this Section 4.2 to a successor entity, Section 6.1 hereof shall be applied ----------- ----------- by reference to events of involuntary liquidation, receivership or conservatorship applicable to such successor entity as such be set forth in the officer's certificate described in Section 4.2(a)(ii); ------------------ (ii) Seller shall have delivered to the Indenture Trustee an Officer's Certificate of Seller and an Opinion of Counsel, each stating that such consolidation, merger, conveyance or transfer and such supplemental agreement comply with this Section 4.2 and that all conditions ----------- precedent herein provided for relating to such transaction have been complied with and, in the case of the Opinion of Counsel, that such supplemental agreement is legal, valid and binding with respect to Seller; and (iii) Seller shall have delivered notice of such consolidation, merger, conveyance or transfer to each Rating Agency; it being understood that a sale, transfer, assignment, participation, pledge or other disposition of the Seller Interest or the issuance of a Supplemental Certificate permitted by Section 3.4 of the Trust Agreement shall not be deemed to be a conveyance or transfer of the Seller's property substantially as an entirety for purposes of this Section 4.2. ----------- (b) The obligations of Seller hereunder shall not be assignable nor shall any Person succeed to the obligations of Seller hereunder except for mergers, consolidations, assumptions or transfers in accordance with the provisions of the foregoing paragraph. Section 4.3. Limitation on Liability of Seller. Neither Seller nor any of --------------------------------- the directors or officers or employees or agents of Seller shall be under any liability to the Issuer, the Owner Trustee, the Noteholders or any other Person for any action taken or for refraining from the taking of any action pursuant to this Agreement whether arising from express or implied duties under this Agreement; provided, however, that this provision shall not protect Seller or -------- ------- any such person against any liability which would otherwise be imposed by reason of willful misfeasance, bad faith or gross negligence in the performance of duties or by reason of its willful misconduct hereunder; and provided, further, -------- ------- that Seller shall be liable for any actual damages resulting directly from Seller's material failure to perform any of its obligations under this Agreement, but only if and to the extent that another remedy is not provided for and available hereunder. Seller and any director or officer or 26 employee or agent of Seller may rely in good faith on any document of any kind prima facie properly executed and submitted by any Person respecting any matters arising hereunder. ARTICLE V OTHER MATTERS RELATING TO THE SERVICER Section 5.1. Liability of the Servicer. The Servicer shall be liable in ------------------------- accordance herewith only to the extent of the obligations specifically undertaken by the Servicer in such capacity herein. Section 5.2. Merger or Consolidation of, or Assumption of the Obligations ------------------------------------------------------------ of, the Servicer. The Servicer shall not consolidate with or merge into any - ---------------- other Person or convey or transfer its properties and assets substantially as an entirety to any Person, unless: (a) the Person formed by such consolidation or into which the Servicer is merged or the Person which acquires by conveyance or transfer the properties and assets of the Servicer substantially as an entirety shall be a corporation or a banking association organized and existing under the laws of the United States of America or any State or the District of Columbia and, if the Servicer is not the surviving entity, shall expressly assume, by an agreement supplemental hereto, executed and delivered to the Owner Trustee in form satisfactory to the Owner Trustee, the performance of every covenant and obligation of the Servicer hereunder; (b) the Servicer has delivered to the Indenture Trustee and each Enhancement Provider an Officer's Certificate and an Opinion of Counsel each stating that such consolidation, merger, conveyance or transfer and such supplemental agreement comply with this Section 5.2 and that all ----------- conditions precedent herein provided for relating to such transaction have been complied with; and (c) the Servicer shall have delivered notice of such consolidation, merger, conveyance or transfer to each of the Rating Agencies; it being understood that a sale, transfer, assignment, participation, pledge or other disposition of the Seller Interest or the issuance of a Supplemental Certificate permitted by Section 3.4 of the Trust Agreement shall not be deemed to be a conveyance or transfer of the Servicer's property substantially as an entirety for purposes of this Section 5.2. ----------- Section 5.3. Limitation on Liability of the Servicer and Others. Except -------------------------------------------------- as provided in Section 5.4 with respect to the Issuer and the Owner Trustee and ----------- Section 27 6.7 of the Indenture with respect to the Indenture Trustee, neither the Servicer nor any of the directors or officers or employees or agents of the Servicer shall be under any liability to the Issuer, the Owner Trustee, the Indenture Trustee, the Noteholders or any other Person for any action taken or for refraining from the taking of any action in its capacity as Servicer pursuant to this Agreement; provided, however, that this provision shall not protect the -------- ------- Servicer or any such Person against any liability which would otherwise be imposed by reason of willful misfeasance, bad faith or gross negligence in the performance of duties or by reason of its willful misconduct hereunder. The Servicer and any director or officer or employee or agent of the Servicer may rely in good faith on any document of any kind prima facie properly executed and submitted by any Person respecting any matters arising hereunder. The Servicer shall not be under any obligation to appear in, prosecute or defend any legal action which does not arise out of its activities in servicing the Receivables in accordance with this Agreement which in its reasonable opinion may involve it in any expense or liability. Section 5.4. Indemnification of the Issuer and the Owner Trustee. The --------------------------------------------------- Servicer shall indemnify, defend and hold harmless the Issuer and the Owner Trustee and its officers, directors, employees and agents from and against any loss, liability, expense, damage or injury suffered or sustained by reason of any acts, omissions or alleged acts or omissions arising out of activities of the Issuer or the Owner Trustee pursuant to the Transaction Documents, including those arising from acts or omissions of the Servicer pursuant to this Agreement, including, but not limited to any judgment, award, settlement, reasonable attorneys' fees and other costs or expenses incurred in connection with the defense of any actual or threatened action, proceeding or claim; provided, -------- however, that the Servicer shall not indemnify the Issuer or the Owner Trustee - ------- if such acts, omissions or alleged acts or omissions constitute fraud, gross negligence or breach of fiduciary duty by the Owner Trustee; provided further, -------- ------- that the Servicer shall not indemnify the Issuer, any Noteholders or any Note Owners for any liabilities, costs or expenses of the Issuer with respect to any action taken by the Indenture Trustee at the request of such Noteholders; provided further, that the Servicer shall not indemnify the Issuer, any - -------- ------- Noteholders or any Note Owners as to any losses, claims or damages incurred by any of them in their capacities as investors, including losses incurred as a result of defaulted Receivables or Receivables which are written off as uncollectible; and provided further, that the Servicer shall not indemnify the -------- ------- Issuer, or any Noteholders for any liabilities, costs or expenses of the Issuer, or such Noteholders arising under any tax law, including any federal, state or local income or franchise taxes or any other tax imposed on or measured by income (or any interest or penalties with respect thereto or arising from a failure to comply therewith) required to be paid by the Issuer, or such Noteholders in connection herewith to any taxing authority. The provisions of this indemnity shall run directly to and be enforceable by an injured party subject to the limitations hereof. 28 Any indemnification pursuant to this Section shall not be payable from the assets of the Issuer. The obligations of the Servicer under this Section 5.4 shall survive the ----------- termination of the Issuer and the resignation or removal of the Owner Trustee. The Servicer shall indemnify the Indenture Trustee as provided in Section 6.7 of the Master Indenture. Section 5.5. The Servicer Not to Resign. The Servicer shall not resign -------------------------- from the obligations and duties hereby imposed on it except upon determination that (i) the performance of its duties hereunder is or becomes impermissible under applicable law and (ii) there is no reasonable action which the Servicer could take to make the performance of its duties hereunder permissible under applicable law. Any such determination permitting the resignation of the Servicer shall be evidenced as to clause (i) by an Opinion of Counsel to such ---------- effect delivered to the Indenture Trustee. No such resignation shall become effective until the Indenture Trustee or a Successor Servicer shall have assumed the responsibilities and obligations of the Servicer in accordance with Section ------- 7.2. If the Indenture Trustee is unable within 120 days of the date of such - --- determination to appoint a Successor Servicer, the Indenture Trustee shall serve as Successor Servicer hereunder. Notice of any resignation by the Servicer shall be given to each Rating Agency by the resigning Servicer. Section 5.6. Access to Certain Documentation and Information Regarding --------------------------------------------------------- the Receivables. The Servicer shall provide to the Indenture Trustee access to - --------------- the documentation regarding the Accounts and the Receivables in such cases where the Indenture Trustee is required in connection with the enforcement of the rights of the Noteholders, or by applicable statutes or regulations to review such documentation, such access being afforded without charge but only (i) upon reasonable request, (ii) during normal business hours, (iii) subject to the Servicer's normal security and confidentiality procedures and (iv) at offices designated by the Servicer. Nothing in this Section 5.6 shall derogate from the ----------- obligation of Seller, the Indenture Trustee or the Servicer to observe any applicable law prohibiting disclosure of information regarding the Obligors and the failure of the Servicer to provide access as provided in this Section 5.6 as ----------- a result of such obligation shall not constitute a breach of this Section 5.6. ----------- Section 5.7. Delegation of Duties. It is understood and agreed by the -------------------- parties hereto that the Servicer may delegate certain of its duties hereunder to Total Systems Services, Inc., a Georgia 29 corporation and to First Data Resources Inc., a Delaware corporation. In addition, in the ordinary course of business, the Servicer may at any time delegate any duties hereunder to any other Person who agrees to conduct such duties in accordance with the Cardholder Guidelines. Any such delegations shall not relieve the Servicer of its liability and responsibility with respect to such duties, and shall not constitute a resignation within the meaning of Section 5.5. The Servicer shall notify each Rating Agency of any material - ----------- delegation of its duties not consistent with its normal practices as of the date hereof. Section 5.8. Examination of Records. The Servicer shall clearly and ---------------------- unambiguously identify each Account (including any Additional Account designated pursuant to Section 2.6) in its computer or other records to reflect that the ----------- Receivables arising in such Account have been transferred by Seller to the Issuer pursuant to this Agreement. The Servicer shall, prior to the sale or transfer to a third party of any receivable held in its custody, examine its computer and other records to determine that such receivable is not a Receivable. ARTICLE VI INSOLVENCY EVENTS Section 6.1. Rights upon the Occurrence of an Insolvency Event. If Seller ------------------------------------------------- shall consent or fail to object to the appointment of a bankruptcy trustee or conservator, receiver or liquidator in any bankruptcy proceeding or other insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings of or relating to Seller of or relating to all or substantially all of Seller's property, or the commencement of an action seeking a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a bankruptcy trustee or conservator, receiver or liquidator in any insolvency, readjustment of debt, marshaling of assets and liabilities or similar proceedings, or for the winding- up, insolvency, bankruptcy, reorganization, conservatorship, receivership or liquidation of such entity's affairs, or notwithstanding an objection by Seller any such action shall have remained undischarged or unstayed for a period of sixty (60) days or upon entry of any order or decree providing for such relief; or Seller shall admit in writing its inability to pay its debts generally as they become due, file, or consent or fail to object (or object without dismissal of any such filing within sixty (60) days of such filing) to the filing of, a petition to take advantage of any Debtor Relief Law, make an assignment for the benefit of its creditors (any such act or occurrence with respect to any Person being an "Insolvency Event"), Seller shall on the day any such Insolvency Event ---------------- occurs immediately cease to transfer Principal Receivables to the Issuer and shall promptly give notice to the Indenture Trustee, the Owner Trustee and the Rating Agencies thereof. 30 ARTICLE VII SERVICER DEFAULTS Section 7.1. Servicer Defaults. If any one of the following events (a ----------------- "Servicer Default") shall occur and be continuing after the FCMT Termination - ----------------- Date: (a) any failure by the Servicer to make any payment, transfer or deposit or to give instructions or notice to the Indenture Trustee to make such payment, transfer or deposit or to make any required drawing, withdrawal, or payment under any Enhancement required to be made by the Servicer on or before the date occurring five Business Days after the date such payment, transfer, deposit, withdrawal or drawing, or such instruction or notice is required to be made or given by the Servicer, as the case may be, under the terms of this Agreement, the Indenture or any Indenture Supplement; or (b) failure on the part of the Servicer duly to observe or perform in any material respect any other covenants or agreements of the Servicer set forth in this Agreement which has a material adverse effect on the Noteholders, which continues unremedied for a period of 60 days after the date on which written notice of such failure requiring the same to be remedied shall have been given to the Servicer by the Indenture Trustee, or to the Servicer and the Indenture Trustee by the Noteholders holding not less than 10% of the outstanding principal amount of any Series adversely affected thereby and continues to materially adversely affect such Noteholders for such period; or the Servicer's delegation of its duties under this Agreement except as permitted by Section ------- 5.7; or - --- (c) any representation, warranty or certification made by the Servicer in this Agreement or in any certificate delivered pursuant to this Agreement shall prove to have been incorrect when made, which has a material adverse effect on the rights of the Noteholders and which continues to be incorrect in any material respect for a period of 60 days after the date on which written notice of such failure requiring the same to be remedied shall have been given to the Servicer by the Indenture Trustee, or to the Servicer and the Indenture Trustee by the Noteholders holding not less than 10% of the outstanding principal amount of any Series adversely affected thereby and continues to materially adversely affect such Noteholders for such period, or if such failure cannot be cured within such 60-day period owing to causes beyond the control of the Servicer, if the Servicer shall fail to proceed promptly to cure the same and prosecute the curing of such failure with diligence and continuity; 31 (d) the Servicer shall (i) become insolvent, (ii) fail to pay its debts generally as they become due, (iii) voluntarily seek, consent to, or acquiesce in the benefit or benefits of any Debtor Relief Law, or (iv) become a party to (or be made the subject of) any proceeding provided for by any Debtor Relief Law, other than as a creditor or claimant, and, in the event such proceeding is involuntary, the petition instituting same is not dismissed within 60 days after its filing; or (e) with respect to any Series, any other event specified in the Indenture Supplement for such Series, then, so long as such Servicer Default shall not have been remedied, either the Indenture Trustee, or the Noteholders holding more than 50% of the Outstanding Amount, by notice then given in writing to the Servicer (and to the Indenture Trustee if given by the Noteholders) (a "Termination Notice"), may terminate all ------------------ of the rights and obligations of the Servicer as Servicer under this Agreement and in and to the Receivables and the proceeds thereof (other than its rights and interest, if any, as holder of the Seller Interest or any Notes). After receipt by the Servicer of such Termination Notice, and on the date that a Successor Servicer shall have been appointed by the Indenture Trustee pursuant to Section 7.2, all authority and power of the Servicer under this Agreement ----------- shall pass to and be vested in a Successor Servicer; and the Indenture Trustee is hereby authorized and empowered (upon the failure of the Servicer to cooperate) to execute and deliver, on behalf of the Servicer, as attorney-in- fact or otherwise, all documents and other instruments upon the failure of the Servicer to execute or deliver such documents or instruments, and to do and accomplish all other acts or things necessary or appropriate to effect the purposes of such transfer of servicing rights. The Servicer agrees to cooperate with the Indenture Trustee and such Successor Servicer in effecting the termination of the responsibilities and rights of the Servicer to conduct servicing hereunder, including the transfer to such Successor Servicer of all authority of the Servicer to service the Receivables provided for under this Agreement, including all authority over all Collections which shall on the date of transfer be held by the Servicer for deposit, or which have been deposited by the Servicer, in any Collection Account or Series Account, or which shall thereafter be received with respect to the Receivables, and in assisting the Successor Servicer and in enforcing all rights to Insurance Proceeds. The Servicer shall promptly transfer its electronic records relating to the Receivables to the Successor Servicer in such electronic form as the Successor Servicer may reasonably request and shall promptly transfer to the Successor Servicer all other records, correspondence and documents necessary for the continued servicing of the Receivables in the 32 manner and at such times as the Successor Servicer shall reasonably request. To the extent that compliance with this Section 7.1 shall require the Servicer to ----------- disclose to the Successor Servicer information of any kind which the Servicer reasonably deems to be confidential, the Successor Servicer shall be required to enter into such customary licensing and confidentiality agreements as the Servicer shall deem necessary to protect its interest. The Servicer shall, on the date of any servicing transfer, transfer all of its rights and obligations, if any, in respect of any Enhancement to the Successor Servicer. Section 7.2. Indenture Trustee to Act; Appointment of Successor. (a) On -------------------------------------------------- and after the receipt by the Servicer of a Termination Notice pursuant to Section 7.1, the Servicer shall continue to perform all servicing functions - ----------- under this Agreement until the date specified in the Termination Notice or otherwise specified by the Indenture Trustee in writing or, if no such date is specified in such Termination Notice or otherwise specified by the Indenture Trustee, until a date mutually agreed upon by the Servicer and the Indenture Trustee. The Indenture Trustee shall as promptly as possible after the giving of a Termination Notice appoint (with the consent of the Noteholders holding greater than 50% of the outstanding principal amount of each Series, and with prior written notice to the Rating Agencies) a successor servicer (the "Successor Servicer"), and such Successor Servicer shall accept its appointment - ------------------- by a written assumption in a form acceptable to the Indenture Trustee. The Indenture Trustee may obtain bids from any potential successor servicer. If the Indenture Trustee is unable to obtain any bids from any potential successor servicer and the Servicer delivers an Officer's Certificate to the effect that it cannot in good faith cure the Servicer Default which gave rise to a transfer of servicing, then the Owner Trustee shall offer Seller the right to accept retransfer of all the Receivables and Seller may accept retransfer of all the Receivables, provided, however, that if the long-term unsecured debt obligations -------- ------- of Seller are not rated at the time of such purchase at least Baa3 by Moody's and BBB- by Standard & Poor's, no such retransfer shall occur unless Seller shall deliver an Opinion of Counsel reasonably acceptable to the Indenture Trustee that such retransfer would not constitute a fraudulent conveyance of Seller. The retransfer deposit amount for such a retransfer shall be equal to the higher of the sum of (i) the outstanding principal balance of the Notes, plus accrued interest thereon, at the Note Rate, through the date of retransfer and (ii) the average bid price quoted by two recognized dealers for a similar security rated in the highest rating category by Moody's and Standard & Poor's and having a remaining maturity substantially similar to the remaining maturity of the Notes. 33 In the event that a Successor Servicer has not been appointed and has not accepted its appointment at the time when the Servicer ceases to act as Servicer, the Indenture Trustee without further action shall automatically be appointed the Successor Servicer. Notwithstanding the above, the Indenture Trustee shall, if it is legally unable so to act, petition a court of competent jurisdiction to appoint any established financial institution having a net worth of not less than $50,000,000 and whose regular business includes the servicing of installment sales charge, credit and/or credit card account receivables as the Successor Servicer hereunder. Notwithstanding anything else herein to the contrary, in no event shall the Indenture Trustee be liable for any servicing fee. (b) Upon its appointment, the Successor Servicer shall be the successor in all respects to the Servicer with respect to servicing functions under this Agreement and shall be subject to all the responsibilities, duties and liabilities relating thereto placed on the Servicer by the terms and provisions hereof, and all references in this Agreement to the Servicer shall be deemed to refer to the Successor Servicer. Any Successor Servicer, by its acceptance of its appointment, will automatically agree to be bound by the terms and provisions of any Enhancement to the extent that such terms apply to the Servicer. Any sub-servicing agreement shall be assigned to the Successor Servicer. (c) In connection with such appointment and assumption, the Indenture Trustee shall be entitled to such compensation, or may make such arrangements for the compensation of the Successor Servicer out of Collections, as it and such Successor Servicer shall agree; provided, however, that no such -------- ------- compensation shall be in excess of the Monthly Servicing Fees permitted to the Servicer pursuant to Section 3.2. The Holder of the Seller Interest agrees that ----------- if the Servicer is terminated hereunder, it will agree, at the request of the Indenture Trustee or any Successor Servicer, to deposit a portion of the Collections in respect of Finance Charge Receivables that it is entitled to receive pursuant to the Indenture, to pay its share of the compensation of the Successor Servicer. The Successor Servicer shall have no liability for any actions or failure to act on the part of the Servicer. (d) All authority and power granted to the Successor Servicer under this Agreement shall automatically cease and terminate upon termination of the Issuer pursuant to the Trust Agreement and shall pass to and be vested in Seller and, Seller is 34 hereby authorized and empowered to execute and deliver, on behalf of the Successor Servicer, as attorney-in-fact or otherwise, all documents and other instruments, and to do and accomplish all other acts or things necessary or appropriate to effect the purposes of such transfer of servicing rights. The Successor Servicer agrees to cooperate with Seller in effecting the termination of the responsibilities and rights of the Successor Servicer to conduct servicing on the Receivables. The Successor Servicer shall transfer its electronic records relating to the Receivables to Seller in such electronic form as Seller may reasonably request and shall transfer all other records, correspondence and documents to Seller in the manner and at such times as Seller shall reasonably request. To the extent that compliance with this Section 7.2 ----------- shall require the Successor Servicer to disclose to Seller information of any kind which the Successor Servicer deems to be confidential, Seller shall be required to enter into such customary licensing and confidentiality agreements as the Successor Servicer shall deem necessary to protect its interests. Section 7.3. Notification to Noteholders. Upon the occurrence of any --------------------------- Servicer Default, the Servicer shall give prompt written notice thereof to a Trustee Officer of the Indenture Trustee and the Indenture Trustee shall give notice to the Noteholders at their respective addresses appearing in the Note Register. Upon any termination or appointment of a Successor Servicer pursuant to this Article VII, the Indenture Trustee shall give prompt written notice ----------- thereof to Noteholders at their respective addresses appearing in the Note Register. A copy of any notice given pursuant to this Section 7.3 shall be ----------- delivered to each Rating Agency. ARTICLE VIII TERMINATION Section 8.1. Termination of Agreement. This Agreement and the respective ------------------------ obligations and responsibilities of the Issuer, Seller and the Servicer under this Agreement shall terminate, except with respect to the duties described in Section 5.4, on the Trust Termination Date. - ----------- 35 ARTICLE IX MISCELLANEOUS PROVISIONS Section 9.1. Amendment; Waiver of Past Defaults. ---------------------------------- (a) This Agreement may be amended from time to time by the Servicer, Seller and the Issuer, without the consent of any of the Indenture Trustee or any Noteholder to cure any ambiguity, to correct or supplement any provisions herein which may be inconsistent with any other provisions herein or to add any other provisions with respect to matters or questions raised under this Agreement which shall not be inconsistent with the provisions of this Agreement; provided, -------- however, that such action shall not adversely affect in any material respect the - ------- interests of any of the Noteholders. Additionally, this Agreement may be amended from time to time by the Servicer, the Seller and the Issuer by a written instrument signed by each of them, without the consent of the Indenture Trustee or any of the Noteholders; provided that (i) Seller shall have delivered -------- to the Indenture Trustee and the Owner Trustee an Officer's Certificate, dated the date of any such Amendment, stating that Seller reasonably believes that such amendment will not have an Adverse Effect and (ii) the Rating Agency Condition shall have been satisfied with respect to any such amendment. Additionally, notwithstanding the preceding sentence, this Agreement will be amended by the Servicer and the Issuer at the direction of Seller without the consent of the Indenture Trustee or any of the Noteholders or Series Enhancers to add, modify or eliminate such provisions as may be necessary or advisable in order to enable all or a portion of the Issuer (1) to qualify as, and to permit an election to be made to cause the Issuer to be treated as, a "financial asset securitization investment trust" as described in the provisions of Section 860L of the Code, and (2) to avoid the imposition of state or local income or franchise taxes imposed on the Issuer's property or its income; provided, -------- however, that (A) Seller delivers to the Indenture Trustee and the Owner Trustee - ------- an Officer's Certificate to the effect that the proposed amendments meet the requirements set forth in this Section, (B) the Rating Agency Condition has been satisfied, and (C) such amendment does not affect the rights, duties or obligations of the Indenture Trustee or the Owner Trustee hereunder. The amendments which Seller may make without the consent of Noteholders or Series Enhancers pursuant to the preceding sentence may include the addition of a Seller. (b) This Agreement may also be amended from time to time by the Servicer, Seller and the Issuer, with the consent of the Noteholders holding more than 66 2/3% of the Outstanding principal amount of the Notes of each Series affected thereby for which Seller has not delivered an Officer's Certificate stating that there is no Adverse Effect, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Noteholders; provided, however, -------- ------- that no such amendment shall (i) reduce in any manner the amount of or delay the timing of any distributions 36 (changes in Pay Out Events or Events of Default that decrease the likelihood of the occurrence thereof shall not be considered delays in the timing of distributions for purposes of this clause) to be made to Noteholders or deposits of amounts to be so distributed or the amount available under any Series Enhancement without the consent of each affected Noteholder, (ii) change the definition of or the manner of calculating the interest of any Noteholder without the consent of each affected Noteholder or (iii) reduce the aforesaid percentage required to consent to any such amendment without the consent of each Noteholder or (iv) adversely affect the rating of any Series or Class by any Rating Agency without the consent of the Noteholders of such Series or Class holding more than 66 2/3% of the Outstanding principal amount of the Notes of such Series or Class affected thereby. (c) Promptly after the execution of any such amendment or consent (other than an amendment pursuant to paragraph (a)), the Issuer shall furnish notification of the substance of such amendment to the Indenture Trustee and each Noteholder, and the Servicer shall furnish notification of the substance of such amendment to each Rating Agency and each Series Enhancer. (d) It shall not be necessary for the consent of Noteholders under this Section 9.1 to approve the particular form of any proposed amendment, but it - ----------- shall be sufficient if such consent shall approve the substance thereof. The manner of obtaining such consents and of evidencing the authorization of the execution thereof by Noteholders shall be subject to such reasonable requirements as the Indenture Trustee may prescribe. (e) Notwithstanding anything in this Section 9.1 to the contrary, no ----------- amendment may be made to this Agreement which would adversely affect in any material respect the interests of any Series Enhancer without the consent of such Series Enhancer. (f) Any Indenture Supplement executed in accordance with the provisions of Article X of the Indenture shall not be considered an amendment of this - --------- Agreement for the purposes of this Section 9.1. ----------- (g) The Noteholders holding 66 2/3% or more of the Outstanding principal amount of the Notes of each Series or, with respect to any Series with two (2) or more Classes, of each Class (or, with respect to any default that does not relate to all Series, 66 2/3% or more of the principal amount of the Outstanding Notes of each Series to which such default relates or, with respect to any such Series with two or more Classes, of each Class) may, on behalf of all Noteholders, waive any default by Seller or the Servicer in the performance of their obligations hereunder and its consequences, except the failure to make any distributions required to be made to Noteholders or to make any required deposits of any amounts to be so distributed. Upon any such waiver of a past default, such default shall cease to exist, and any default arising therefrom shall be deemed to have been remedied for every purpose 37 of this Agreement. No such waiver shall extend to any subsequent or other default or impair any right consequent thereon except to the extent expressly so waived. (h) The Owner Trustee may, but shall not be obligated to, enter into any such amendment which affects the Owner Trustee's rights, duties or immunities under this Agreement or otherwise. In connection with the execution of any amendment hereunder, the Owner Trustee shall be entitled to receive the Opinion of Counsel described in Section 9.2(d). -------------- Section 9.2. Protection of Right, Title and Interest to Issuer. ------------------------------------------------- (a) Seller shall cause this Agreement, all amendments and supplements hereto and all financing statements and continuation statements and any other necessary documents covering the Indenture Trustee's and the Issuer's right, title and interest to the Issuer to be promptly recorded, registered and filed, and at all times to be kept recorded, registered and filed, all in such manner and in such places as may be required by law fully to preserve and protect the right, title and interest of the Indenture Trustee, Noteholders and the Issuer hereunder to all property comprising the Issuer. Seller shall deliver to the Indenture Trustee file-stamped copies of, or filing receipts for, any document recorded, registered or filed as provided above, as soon as available following such recording, registration or filing. Seller shall cooperate fully with the Servicer in connection with the obligations set forth above and will execute any and all documents reasonably required to fulfill the intent of this paragraph. (b) Within thirty (30) days after the Seller makes any change in its name, identity or corporate structure which would make any financing statement or continuation statement filed in accordance with paragraph (a) seriously misleading within the meaning of Section 9-402(7) (or any comparable provision) of the UCC, the Seller shall give the Indenture Trustee notice of any such change and shall file such financing statements or amendments as may be necessary to continue the perfection of the Issuer's security interest or ownership interest in the Receivables and the proceeds thereof. (c) Each of the Seller and the Servicer shall give the Indenture Trustee prompt notice of any relocation of its chief principal executive office or any change in the jurisdiction under whose laws it is organized and whether, as a result of such relocation or change, the applicable provisions of the UCC would require the filing of any amendment of any previously filed financing or continuation statement or of any new financing statement and shall file such financing statements or amendments as may be necessary to perfect or to continue the perfection of the Issuer's security interest in the Receivables and the proceeds thereof. Each of Seller and Servicer shall at all times maintain its chief principal executive offices within the United States and shall at all times be organized under the laws of a jurisdiction located within the United States. 38 (d) Seller shall deliver to the Indenture Trustee (i) upon the execution and delivery of each amendment of this Agreement, an Opinion of Counsel to the effect specified in Exhibit F-1; (ii) on each date specified in Section ----------- ------- 2.6(c)(vii) with respect to Additional Accounts added pursuant to Section 2.6(a) - ----------- -------------- or (b), an Opinion of Counsel substantially in the form of Exhibit F-2; and --- ----------- (iii) on or before April 30 of each year following the year in which the FCMT Termination Date occurs, an Opinion of Counsel substantially in the form of Exhibit F-3. - ----------- Section 9.3. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ------------- ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS. Section 9.4. Notices; Payments. ----------------- (a) All demands, notices, instructions, directions and communications (collectively, "Notices") under this Agreement shall be in writing and shall be ------- deemed to have been duly given if personally delivered at, mailed by registered mail, return receipt requested, or sent by facsimile transmission (i) in the case of Seller and the Servicer, to First Consumers National Bank, 9300 S.W. Gemini Drive, Beaverton, Oregon 97008, Attn: President, (ii) in the case of the Issuer or the Owner Trustee, to the Corporate Trust Office, Attn: Corporate Trust & Agency Services, with a copy to the Administrator, (iii) in the case of the Rating Agency for a particular Series, the address, if any, specified in the Indenture Supplement relating to such Series, and (iv) to any other Person as specified in the Indenture or any Indenture Supplement; or, as to each party, at such other address or facsimile number as shall be designated by such party in a written notice to each other party. (b) Any Notice required or permitted to be given to a Holder of Registered Notes shall be given by first-class mail, postage prepaid, at the address of such Holder as shown in the Note Register. Any Notice so mailed within the time prescribed in this Agreement shall be conclusively presumed to have been duly given, whether or not the Noteholder receives such Notice. In addition, in the case of any Series or Class with respect to which any Notes are outstanding, any Notice required or permitted to be given to Noteholders of such Series or Class shall be published in an Authorized Newspaper within the time period prescribed in this Agreement. Section 9.5. Severability of Provisions. If any one or more of the -------------------------- covenants, agreements, provisions or terms of this Agreement shall for any reason whatsoever be held invalid, then such provisions shall be deemed severable from the remaining provisions of this Agreement and shall in no way affect the validity or 39 enforceability of the remaining provisions or of the Notes or the rights of the Noteholders. Section 9.6. Further Assurances. Seller and the Servicer agree to do and ------------------ perform, from time to time, any and all acts and to execute any and all further instruments required or reasonably requested by the Owner Trustee and the Indenture Trustee more fully to effect the purposes of this Agreement, including the execution of any financing statements or continuation statements relating to the Receivables for filing under the provisions of the UCC of any applicable jurisdiction. Section 9.7. No Waiver; Cumulative Remedies. No failure to exercise and ------------------------------ no delay in exercising, on the part of the Owner Trustee, the Indenture Trustee or the Noteholders, any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege under this Agreement preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges provided under this Agreement are cumulative and not exhaustive of any rights, remedies, powers and privileges provided by law. Section 9.8. Counterparts. This Agreement 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 together shall constitute one and the same instrument. Section 9.9. Third-Party Beneficiaries. This Agreement will inure to the ------------------------- benefit of and be binding upon the parties hereto, the Indenture Trustee, the Noteholders, and any Series Enhancer. Except as otherwise expressly provided in this Agreement, no other Person will have any right or obligation hereunder. Section 9.10. Actions by Noteholders. ---------------------- (a) Wherever in this Agreement a provision is made that an action may be taken or a Notice given by Noteholders, such action or Notice may be taken or given by any Noteholder, unless such provision requires a specific percentage of Noteholders. (b) Any Notice, request, authorization, direction, consent, waiver or other act by the Noteholder shall bind such Holder and every subsequent Holder of such Note and of any Note issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done or omitted to be done by the Owner Trustee, Seller or the Servicer in reliance thereon, whether or not notation of such action is made upon such Note. 40 Section 9.11. Rule 144A Information. For so long as any of the Notes of --------------------- any Series or Class are "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act, each of Seller, the Owner Trustee, the Indenture Trustee, the Servicer and any Series Enhancer agree to cooperate with each other to provide to any Noteholders of such Series or Class and to any prospective purchaser of Notes designated by such Noteholder, upon the request of such Noteholder or prospective purchaser, any information required to be provided to such holder or prospective purchaser to satisfy the condition set forth in Rule 144A(d)(4) under the Securities Act. Section 9.12. Merger and Integration. Except as specifically stated ---------------------- otherwise herein, this Agreement sets forth the entire understanding of the parties relating to the subject matter hereof, and all prior understandings, written or oral, are superseded by this Agreement. This Agreement may not be modified, amended, waived or supplemented except as provided herein. Section 9.13. No Bankruptcy Petition. Each of Seller and Servicer, ---------------------- severally and not jointly, hereby covenants and agrees that, prior to the date which is one (1) year and one (1) day after the payment in full of all Notes, it will not institute against, or join any other Person in instituting against, the Issuer any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or other similar proceeding under the laws of the United States or any state of the United States. Nothing in this Section 9.13 shall preclude, or ------------ be deemed to estop, any Seller and Servicer from taking (to the extent such action is otherwise permitted to be taken by such Person hereunder) or omitting to take any action prior to such date in (i) any case or proceeding voluntarily filed or commenced by or on behalf of the Issuer under or pursuant to any such law or (ii) any involuntary case or proceeding pertaining to the Issuer under or pursuant to any such law. Section 9.14. Rights of Indenture Trustee. The Indenture Trustee shall --------------------------- have herein the same rights, protections, indemnities and immunities as specified in the Indenture. Section 9.15. Rights of the Owner Trustee. Each of the parties hereto --------------------------- acknowledges and agrees that this Agreement is being executed and delivered by Bankers Trust Company not individually but solely and exclusively in its capacity as Owner Trustee on behalf of First Consumers Credit Card Master Note Trust for the purpose and with the intention of binding First Consumers Credit Card Master Note Trust. No obligations or liabilities hereunder shall run against Bankers Trust Company in its individual capacity or against its properties or assets. 41 IN WITNESS WHEREOF, Seller, the Servicer and the Issuer have caused this Transfer and Servicing Agreement to be duly executed by their respective officers as of the day and year first above written. FIRST CONSUMERS NATIONAL BANK, as Seller and Servicer By: /s/ John R. Steele ------------------ Name: John R. Steele Title: Treasurer FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, Issuer By: BANKERS TRUST COMPANY, not in its individual capacity but solely as Owner Trustee on behalf of the Issuer By /s/ Eileen M. Hughes -------------------- Name: Eileen M. Hughes Title: Vice President Acknowledged and Accepted: THE BANK OF NEW YORK, not in its individual capacity but solely as Indenture Trustee By: /s/ Greg Anderson ----------------- Name: Greg Anderson Title: Authorized Agent First Consumers Credit Card Master Note Trust Transfer and Servicing Agreement Signature Page EXHIBIT A to TRANSFER AND SERVICING AGREEMENT FORM OF ASSIGNMENT OF RECEIVABLES IN ADDITIONAL ACCOUNTS (As required by Section 2.6 of the Transfer and Servicing Agreement) ----------- ASSIGNMENT No. __ OF RECEIVABLES IN ADDITIONAL ACCOUNTS dated as of _____________, by and among FIRST CONSUMERS NATIONAL BANK, a national banking association, as Seller (the "Seller") and as Servicer (the "Servicer") and FIRST ------ -------- CONSUMERS CREDIT CARD MASTER NOTE TRUST (the "Issuer"), pursuant to the Transfer ------ and Servicing Agreement referred to below. WITNESSETH WHEREAS, the Seller, the Servicer and the Issuer are parties to the Transfer and Servicing Agreement, dated as of March 1, 2001 (the "Agreement"); --------- WHEREAS, pursuant to the Agreement, the Seller wishes to designate Additional Accounts to be included as Accounts and to convey the Receivables of such Additional Accounts (as each such term is defined in the Agreement), whether now existing or hereafter created, to the Issuer; and WHEREAS, the Issuer is willing to accept such designation and conveyance subject to the terms and conditions hereof; NOW, THEREFORE, the Seller, the Servicer and the Issuer hereby agree as follows: 1. Defined Terms. All capitalized terms used herein shall have the ------------- meanings ascribed to them in the Agreement unless otherwise defined herein. "Addition Date" means, with respect to the Additional Accounts designated ------------- hereby, ____________, 200__. "Notice Date" means, with respect to the Additional Accounts designated ----------- hereby, ____________, ____, (which shall be a date on or prior to the fifth Business Day prior to the Addition Date). 2. Designation of Additional Accounts. On or before the date hereof, the ---------------------------------- Seller will deliver to the Owner Trustee a computer file or microfiche list containing a true and complete schedule identifying all such Additional Accounts (the Exhibit A-1 "Additional Accounts") specifying for each such Additional Account, as of the ------------------- Notice Date, its account number, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables outstanding in such Account, which computer file or microfiche list shall supplement Schedule 1 to ---------- the Agreement. 3. Conveyance of Receivables. (a) The Seller does hereby transfer, ------------------------- assign, set over and otherwise convey, without recourse except as set forth in the Transfer and Servicing Agreement, to the Issuer, all its right, title and interest in, to and under the Receivables of such Additional Accounts existing at the close of business on the Notice Date and thereafter created from time to time until the termination of the Issuer, all Recoveries related thereto, all monies due or to become due and all amounts received or receivable with respect thereto and all proceeds thereof. The foregoing does not constitute and is not intended to result in the creation or assumption by the Issuer, the Owner Trustee, the Indenture Trustee, any Noteholders or any Series Enhancer of any obligation of the Servicer, the Seller or any other Person in connection with the Accounts, the Receivables or under any agreement or instrument relating thereto, including any obligation to Obligors, merchant banks, merchants or clearance systems. (b) The Seller agrees to record and file, at its own expense, financing statements (and continuation statements when applicable) with respect to the Receivables in Additional Accounts existing on the Notice Date and thereafter created meeting the requirements of applicable state law in such manner and in such jurisdictions as are necessary to perfect, and maintain perfection of, the sale and assignment of its interest in such Receivables to the Issuer, and to deliver a file-stamped copy of each such financing statement or other evidence of such filing to the Owner Trustee on or prior to the Addition Date. The Owner Trustee shall be under no obligation whatsoever to file such financing or continuation statements or to make any other filing under the UCC in connection with such sale and assignment. (c) In connection with such sale, the Seller further agrees, at its own expense, on or prior to the date of this Assignment, to indicate in the appropriate computer files that Receivables created in connection with the Additional Accounts and designated hereby have been conveyed to the Issuer pursuant to the Agreement and this Assignment. (d) The Seller does hereby grant to the Issuer a security interest in all of its right, title and interest, whether now owned or hereafter acquired, in and to the Receivables in the Additional Accounts existing on the Notice Date and thereafter created, all Recoveries related thereto, all monies due or to become due and all amounts received or receivable with respect thereto, all money, accounts, general intangibles, chattel paper, instruments, documents, goods, investment property, deposit accounts, certificates of deposit, letters of credit, and advices of credit consisting of, arising from or related to the foregoing, and all proceeds thereof. This Assignment constitutes a security agreement under the UCC. Exhibit A-2 4. Acceptance by Issuer. The Issuer hereby acknowledges its acceptance of -------------------- all right, title and interest to the property, existing on the Notice Date and thereafter created, conveyed to the Issuer pursuant to Section 3(a) of this ------------ Assignment. The Issuer further acknowledges that, prior to or simultaneously with the execution and delivery of this Assignment, the Seller delivered to the Owner Trustee the computer file or microfiche list described in Section 2 of --------- this Assignment. 5. Representations and Warranties of the Seller. The Seller hereby -------------------------------------------- represents and warrants to the Issuer as of the Addition Date: (a) Legal Valid and Binding Obligation. This Assignment constitutes a ---------------------------------- legal, valid and binding obligation of the Seller enforceable against the Seller in accordance with its terms, except as such enforceability may be limited by applicable receivership or conservatorship, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect affecting the enforcement of creditors' rights in general and the rights of creditors of national banking associations and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity); (b) Schedule 1. Schedule 1 to this Assignment and the computer file or ---------- microfiche list delivered pursuant to Section 2 of this Assignment is an --------- accurate and complete listing in all material respects of all the Additional Accounts as of the Addition Date and the information contained therein with respect to the identity of such Additional Accounts and the Receivables existing thereunder is true and correct in all material respects as of the Addition Date; (c) Eligibility of Accounts. Each Additional Account designated hereby ----------------------- is an Eligible Account; (d) Selection Procedures. No selection procedures believed by the -------------------- Seller to be materially adverse to the interests of the Noteholders were utilized in selecting the Additional Accounts designated hereby; (e) Insolvency. The Seller is not insolvent and, after giving effect ---------- to the conveyance set forth in Section 3 of this Assignment, will not be --------- insolvent; Exhibit A-3 (f) Security Interest. This Assignment constitutes (i) a valid ----------------- transfer and assignment to the Issuer of all right, title and interest of the Seller in and to Receivables now existing and hereafter created in the Additional Accounts designated hereby, and all proceeds (as defined in the UCC as in effect in the State of Illinois) of such Receivables and Insurance Proceeds relating thereto, and such Receivables and any Collections, Recoveries and other proceeds thereof and Insurance Proceeds relating thereto will be held by the Issuer free and clear of any Lien of any Person except for (x) Liens permitted under Section 2.5(b) of the -------------- Transfer and Servicing Agreement and (y) the interest of the Seller as holder of the Collateral Certificate and/or (ii) it constitutes a grant of a security interest (as defined in the UCC as in effect in the State of Illinois) in such property to the Issuer, which is enforceable with respect to the existing Receivables in the Additional Accounts designated hereby, the Collections, Recoveries and other proceeds (as defined in the UCC as in effect in the State of Illinois) thereof and Insurance Proceeds relating thereto upon the conveyance of such Receivables to the Issuer, and which will be enforceable with respect to the Receivables thereafter created in respect of the Additional Accounts designated hereby, the Collections, Recoveries and other proceeds (as defined in the UCC as in effect in the State of Illinois) thereof and Insurance Proceeds relating thereto, upon such creation; and (iii) if this Assignment constitutes the grant of a security interest to the Issuer in such property, upon the filing of a financing statement described in Section 3 of this Assignment with respect --------- to the Additional Accounts designated hereby and in the case of the Receivables of such Additional Accounts thereafter created and the Collections, Recoveries and other proceeds (as defined in the UCC as in effect in the State of Illinois) thereof, and Insurance Proceeds relating to such Receivables, upon such creation, the Issuer shall have a first priority perfected security interest in such property, except for Liens permitted under Section 2.5(b) of the Transfer and Servicing Agreement, the -------------- interest of the Seller as holder of the Collateral Certificate and the Seller's right to receive interest accruing on, and investment earnings in respect of, the Collection Subaccount and any Series Account as provided in the Transfer and Servicing Agreement. (g) Notice has been given to each Rating Agency and to each Enhancement Provider as required under Section 2.7(d) of the Transfer and -------------- Servicing Agreement. Exhibit A-4 6. Conditions Precedent. The acceptance of the Owner Trustee set forth in -------------------- Section 4 above and the amendment of the Transfer and Servicing Agreement set - --------- forth in Section 7 below are subject to the satisfaction, on or prior to the --------- Addition Date, of the following conditions precedent: (a) Officer's Certificate. The Seller shall have delivered to the --------------------- Owner Trustee a certificate of a Vice President or more senior officer, certifying that (i) all requirements set forth in Section 2.6 of the ----------- Transfer and Servicing Agreement for designating Additional Accounts and conveying the Principal Receivables of such Accounts, whether now existing or hereafter created, have been satisfied and (ii) each of the representations and warranties made by the Seller in Section 5 is true and --------- correct as of the Addition Date. The Owner Trustee may conclusively rely on such Officer's Certificate, shall have no duty to make inquiries with regard to the matters set forth therein, and shall incur no liability in so relying. (b) Opinion of Counsel. The Seller shall have delivered to the Owner ------------------ Trustee an Opinion of Counsel with respect to the Additional Accounts designated hereby substantially in the form of Exhibit F-2 to the ----------- Agreement. (c) Additional Information. The Seller shall have delivered to the ---------------------- Owner Trustee such information as was reasonably requested by the Owner Trustee to satisfy itself as to the accuracy of the representation and warranty set forth in Section 5(d) to this Assignment. ------------ 7. Amendment of the Transfer and Servicing Agreement. The Transfer and ------------------------------------------------- Servicing Agreement is hereby amended to provide that all references therein to the "Transfer and Servicing Agreement", to "this Agreement" and "herein" shall be deemed from and after the Addition Date to be a dual reference to the Transfer and Servicing Agreement as supplemented by this Assignment. Except as expressly amended hereby, all of the representations, warranties, terms, covenants and conditions of the Transfer and Servicing Agreement shall remain unamended and shall continue to be, and shall remain, in full force and effect in accordance with its terms and except as expressly provided herein shall not constitute or be deemed to constitute a waiver of compliance with or a consent to noncompliance with any term or provision of the Transfer and Servicing Agreement. Exhibit A-5 8. Counterparts. This Assignment 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 together shall constitute one and the same instrument. 9. Rights of the Owner Trustee. Each of the parties hereto acknowledges --------------------------- and agrees that this Agreement is being executed and delivered by Bankers Trust Company not individually but solely and exclusively in its capacity as Owner Trustee on behalf of First Consumers Credit Card Master Note Trust for the purpose and with the intention of binding First Consumers Credit Card Master Note Trust. No obligations or liabilities hereunder shall run against Bankers Trust Company in its individual capacity or against its properties or assets. Exhibit A-6 IN WITNESS WHEREOF, the undersigned have caused this Assignment of Receivables in Additional Accounts to be duly executed and delivered by their respective duly authorized officers on the day and year first above written. FIRST CONSUMERS NATIONAL BANK, Seller and Servicer By:_________________________________ Name: Title: FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, Issuer By: BANKERS TRUST COMPANY, not in its individual capacity but solely on behalf of the Issuer By:_________________________________ Name: Title: Exhibit A-7 Schedule 1 to Assignment of Receivables in Additional Accounts ADDITIONAL ACCOUNTS ------------------- Exhibit A-8 EXHIBIT B to TRANSFER AND SERVICING AGREEMENT FORM OF REASSIGNMENT OF RECEIVABLES IN REMOVED ACCOUNTS (As required by Section 2.7 of the Transfer and Servicing Agreement) ----------- REASSIGNMENT No. _______ OF RECEIVABLES dated as of _________, by and among FIRST CONSUMERS NATIONAL BANK, a national banking association, as Seller (the "Seller") and Servicer (the "Servicer"), and FIRST CONSUMERS CREDIT CARD MASTER - ------- NOTE TRUST (the "Issuer"), pursuant to the Transfer and Servicing Agreement ------ referred to below. WITNESSETH: WHEREAS the Seller, the Servicer and the Issuer are parties to the Transfer and Servicing Agreement, dated as of March 1, 2001 (the "Agreement"); --------- WHEREAS pursuant to the Agreement, the Seller wishes to remove from the Issuer all Receivables owned by the Issuer in certain designated Accounts (the "Removed Accounts") and to cause the Issuer to reconvey the Receivables of such - ----------------- Removed Accounts, whether now existing or hereafter created, from the Issuer to the Seller; and WHEREAS the Issuer is willing to accept such designation and to reconvey the Receivables in the Removed Accounts subject to the terms and conditions hereof; NOW, THEREFORE, the Seller and the Issuer hereby agree as follows: 1. Defined Terms. All terms defined in the Agreement and used herein ------------- shall have such defined meanings when used herein, unless otherwise defined herein. "Removal Date" means, with respect to the Removed Accounts designated ------------ hereby, ___________, ____. "Removal Notice Date" means, with respect to the Removed Accounts ------------------- ______________, ____, (which shall be a date on or prior to the fifth Business Day prior to the Removal Date). 2. Designation of Removed Accounts. On or before the date that is ten ------------------------------- (10) Business Days after the Removal Date, the Seller will deliver to the Owner Trustee a computer file or microfiche list containing a true and complete schedule identifying all Accounts the Receivables of which are being removed from the Issuer, Exhibit B-1 specifying for each such Account, as of the Removal Notice Date, its account number, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables in such Account, which computer file or microfiche list shall supplement Schedule 1 to the Agreement. ---------- 3. Conveyance of Receivables. (a) The Issuer does hereby transfer, ------------------------- assign, set over and otherwise convey to the Seller, without recourse, on and after the Removal Date, all right, title and interest of the Issuer in, to and under the Receivables existing at the close of business on the Removal Notice Date and thereafter created from time to time in the Removed Accounts designated hereby, all Recoveries related thereto, all monies due or to become due and all amounts received or receivable with respect thereto and all proceeds thereof. (b) In connection with such transfer, the Issuer agrees to execute and deliver to the Seller on or prior to the date this Reassignment is delivered, applicable termination statements prepared by the Seller with respect to the Receivables existing at the close of business on the Removal Notice Date and thereafter created from time to time in the Removed Accounts reassigned hereby and the proceeds thereof evidencing the release by the Issuer of its interest in the Receivables in the Removed Accounts, and meeting the requirements of applicable state law, in such manner and such jurisdictions as are necessary to terminate such interest. 4. Representations and Warranties of the Seller. The Seller hereby -------------------------------------------- represents and warrants to the Issuer as of the Removal Date: (a) Legal Valid and Binding Obligation. This Reassignment Agreement ---------------------------------- constitutes a legal, valid and binding obligation of the Seller enforceable against the Seller in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect affecting the enforcement of creditors' rights in general and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity); and (b) Selection Procedures. No selection procedures believed by the Seller -------------------- to be materially adverse to the interests of the Noteholders were utilized in selecting the Removed Accounts designated hereby. 5. Condition Precedent. The amendment of the Transfer and Servicing ------------------- Agreement set forth in Section 7 hereof is subject to the satisfaction, on or --------- prior to the Removal Date, of the following condition precedent: Exhibit B-2 6. Officers' Certificate. The Seller shall have delivered to the Owner --------------------- Trustee an Officers' Certificate certifying that (i) as of the Removal Date, all requirements set forth in Section 2.5 of the Transfer and Servicing Agreement ----------- for designating Removed Accounts and reconveying the Receivables of such Removed Accounts, whether now existing or hereafter created, have been satisfied, and (ii) each of the representations and warranties made by the Seller in Section 5 --------- hereof is true and correct as of the Removal Date. The Owner Trustee may conclusively rely on such Officer's Certificate, shall have no duty to make inquiries with regard to the matters set forth therein and shall incur no liability in so relying. 7. Amendment of the Transfer and Servicing Agreement. The Transfer and ------------------------------------------------- Servicing Agreement is hereby amended to provide that all references therein to the "Transfer and Servicing Agreement", to "this Agreement" and "herein" shall be deemed from and after the Removal Date to be a dual reference to the Transfer and Servicing Agreement as supplemented by this Reassignment Agreement. Except as expressly amended hereby, all of the representations, warranties, terms, covenants and conditions of the Transfer and Servicing Agreement shall remain unamended and shall continue to be, and shall remain, in full force and effect in accordance with its terms and except as expressly provided herein shall not constitute or be deemed to constitute a waiver of compliance with or a consent to non-compliance with any term or provision of the Transfer and Servicing Agreement. 8. Counterparts. This Reassignment Agreement 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 together shall constitute one and the same instrument. 9. Rights of the Owner Trustee. Each of the parties hereto acknowledges --------------------------- and agrees that this Agreement is being executed and delivered by Bankers Trust Company not individually but solely and exclusively in its capacity as Owner Trustee on behalf of First Consumers Credit Card Master Note Trust for the purpose and with the intention of binding First Consumers Credit Card Master Note Trust. No obligations or liabilities hereunder shall run against Bankers Trust Company in its individual capacity or against its properties or assets. Exhibit B-3 IN WITNESS WHEREOF, the undersigned have caused this Reassignment Agreement to be duly executed and delivered by their respective duly authorized officers on the day and year first above written. FIRST CONSUMERS NATIONAL BANK, Seller and Servicer By:_______________________________ Name: Title: FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, Issuer By: BANKERS TRUST COMPANY, not in its individual capacity but solely on behalf of the Issuer By:_______________________________ Name: Title: Exhibit B-4 Schedule 1 to Reassignment Agreement REMOVED ACCOUNTS ---------------- Exhibit B-5 EXHIBIT C to TRANSFER AND SERVICING AGREEMENT FORM OF MONTHLY SERVICER'S CERTIFICATE The undersigned, a duly authorized representative of First Consumers National Bank ("FCNB"), as Servicer pursuant to the Transfer and Servicing ---- Agreement dated as of March 1, 2001 (the "Transfer and Servicing Agreement") -------------------------------- between FCNB, as Seller and Servicer, and First Consumers Credit Card Master Note 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; provided that the -------- "preceding Monthly Period" shall mean the ------------------------ Monthly Period immediately preceding the calendar month in which this Certificate is delivered. This Certificate is delivered pursuant to Section 3.4(b) of the Transfer and Servicing -------------- Agreement. References herein to certain sections and subsections are references to the respective sections and subsections of the Transfer and Servicing Agreement. 2. FCNB is the Servicer under the Transfer and Servicing Agreement. 3. The undersigned is a Servicing Officer. 4. The date of this Certificate is a Determination Date under the Transfer and Servicing Agreement. 5. The aggregate amount of Collections processed during the preceding Monthly Period was equal to $ ________________________ 6. The aggregate amount of the Allocation Percentage of Collections of Principal Receivables processed by the Servicer pursuant to Article VIII of the Indenture during the preceding Monthly Period was equal to $ _________________________ 7. The aggregate amount of the Allocation Percentage of Finance Charge Collections Exhibit C-1 processed by the Servicer pursuant to Article VIII of the Indenture during the preceding Monthly Period was equal to $ _________________________ 8. The Default Amount for the preceding Monthly Period was equal to $ _________________________ 9. Net Recoveries for the preceding Monthly Period was equal to $ _________________________ 10. The Portfolio Yield for the preceding Monthly Period for each of the following Series was equal to: Series __________________$ _________________________ Series __________________$ _________________________ 11. The Base Rate for the preceding Monthly Period for each of the following Series was equal to: Series ___________________$ _________________________ Series ___________________$ _________________________ 12. The aggregate amount of Receivables as of the last day of the preceding Monthly Period was equal to $ _________________________ 13. The aggregate amount of funds on deposit in the Collection Account (or any Subaccount thereof) and each other Series Account with respect to Collections processed as of the end of the last day of the preceding Monthly Period was equal to $___________ 14. The aggregate amount, if any, of withdrawals, drawings or payments under any Enhancement with respect to each Series made with respect to the preceding Monthly Period was equal to $ _________________________ 15. The aggregate amount payable to the Noteholders on the succeeding Distribution Date in respect of interest is equal to $ _________________________ Exhibit C-2 16. The aggregate amount payable to the Noteholders on the succeeding Distribution Date in respect of principal is equal to $ ______________ Exhibit C-3 EXHIBIT D to TRANSFER AND SERVICING AGREEMENT FORM OF ANNUAL SERVICER'S CERTIFICATE The undersigned, a duly authorized representative of First Consumers National Bank ("FCNB") as Servicer pursuant to the Transfer and Servicing ---- Agreement dated as of March 1, 2001 (the "Transfer and Servicing Agreement") -------------------------------- between FCNB and Spiegel Credit Card Master Note Trust, as Issuer, does hereby certify that: 1. FCNB is Servicer under the Transfer and Servicing Agreement. 2. The undersigned is duly authorized pursuant to the Transfer and Servicing Agreement to execute and deliver this Certificate to the Owner Trustee. 3. This Certificate is delivered pursuant to Section 3.5 of the Transfer ----------- and Servicing Agreement. 4. A review of the activities of the Servicer during the calendar year ended December 31, 200_ was conducted under my supervision. 5. Based on such review, the Servicer has, to the best of my knowledge, fully performed all its obligations under the Transfer and Servicing Agreement throughout such calendar year and no default in the performance of such obligations has occurred or is continuing except as set forth in paragraph 6 below. 6. The following is a description of each default in the performance of the Servicer's obligations under the provisions of the Transfer and Servicing Agreement known to me to have been made during the calendar year ended December 31, 200_, which sets forth in detail the (i) nature of each such default, (ii) the action taken by the Servicer, if any, to remedy each such default and (iii) the current status of each such default: [If applicable, insert "None."] Exhibit D-1 IN WITNESS WHEREOF, the undersigned has duly executed this Certificate this day of____________, 200 ___. _______________________________ Name: Title: Exhibit D-2 EXHIBIT E to TRANSFER AND SERVICING AGREEMENT FORM OF ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING REPORT First Consumers National Bank 9300 S.W. Gemini Drive Beaverton, Oregon 97008 The Bank of New York 2 North LaSalle Street, Suite 1020 Chicago, Illinois 60602 Gentlemen: We have applied certain agreed-upon procedures, as discussed below, to the accounting records of First Consumers National Bank (FCNB, or in its capacity as Servicer, the "Servicer") as of December 31, ____, solely to assist the Servicer -------- in its responsibilities as Servicer under the Transfer and Servicing Agreement dated as of March 1, 2001, between FCNB, the Servicer and First Consumers Credit Card Master Note Trust (the "Transfer and Servicing Agreement"). It is -------------------------------- understood that this report is solely for your information and is not to be referred to or distributed for any other purpose to anyone who is not a member of management of the Servicer, SCCIII or the Owner Trustee, or who is not otherwise specifically defined as a recipient in the Servicing Agreement. Our procedures and findings are as follows: (a) We compared each of the amounts in the certificates delivered by the Servicer pursuant to Section 3.4(b) of the Transfer and Servicing -------------- Agreement, the statements or reports delivered to the Noteholders of each Series pursuant to the Indenture Supplements and the monthly payment instructions delivered to the Owner Trustee with respect to each Series of Notes pursuant to the Indenture for each of the months in the year ended December 31, _____ [the period of ___ months ended ______, ____] to the corresponding amounts in schedules prepared by the Servicer and found them to be in agreement. (b) We verified the mathematical accuracy of the schedules prepared by the Servicer and found no differences. (c) We compared the information in the schedules prepared by the Servicer to data extracted from the Servicer's credit accounting system and found them to be in agreement. Exhibit E-1 (d) We read the Annual Servicer's Certificate delivered pursuant to Section 3.5 of the Servicing Agreement for the year ended December 31, ----------- _____ [for the period of ____months ended, _______, _____] and made inquiries of the Servicer's management regarding the Servicer's compliance with the guidelines of the Transfer and Servicing Agreement. Because the above procedures do not constitute an audit made in accordance with generally accepted auditing standards, we express no opinion on any of the specified accounts or items referred to above. In connection with the procedures referred to above, no matters came to our attention that caused us to believe that the certificates and reports referred to above should be adjusted. Based on our reading, inquiries and procedures as set forth in paragraphs (a), (b), (c) and (d) above, nothing came to our attention that caused us to believe that the servicing of the accounts was not conducted in compliance with the terms and conditions set forth in the Transfer and Servicing Agreement insofar as they relate to accounting matters. Had we performed additional procedures, matters might have come to our attention that would have been reported to you. This report relates only to the accounts or items specified above and does not extend to any financial statements of First Consumers National Bank, or First Consumers Credit Card Master Note Trust taken as a whole. Date: Exhibit E-2 EXHIBIT F-1 FORM OF OPINION OF COUNSEL WITH RESPECT TO AMENDMENTS (Provisions to be included in Opinion of Counsel to be delivered pursuant to Section 9.2(d)(i)) ----------------- The opinions set forth below may be subject to all the qualifications, assumptions, limitations and exceptions taken or made in the Opinions Of Counsel delivered on any applicable Closing Date. (i) The amendment to the Transfer and Servicing Agreement, attached hereto as Schedule 1 (the "Amendment" ), has been duly authorized, executed and ---------- --------- delivered by Seller and constitutes the legal, valid and binding agreement of Seller, enforceable in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws from time to time in effect affecting creditors' rights generally. The enforceability of Seller's obligations is also subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law). (ii) The Amendment has been entered into in accordance with the terms and provisions of Section 9.1 of the Transfer and Servicing Agreement. ----------- Exhibit F-1-1 EXHIBIT F-2 to TRANSFER AND SERVICING AGREEMENT (Provisions to be included in Opinion of Counsel to be delivered pursuant to Section 2.6(c)(vii) and Section 9.2(d)(ii)) ------------------- ------------------ The opinions set forth below may be subject to all the qualifications, assumptions, limitations and exceptions taken or made in the Opinions of Counsel delivered on any applicable Closing Date. 1. Except for any Receivable that is evidenced by an instrument, the Receivables constitute accounts or general intangibles under Article 9 of the UCC. 2. If the Assignment, together with the Agreement, constitutes a valid assignment of all Seller's right, title and interest in, to and under the Receivables in Schedule 1 to the Assignment and all of the Seller's rights, ---------- remedies, powers, and privileges with respect to such Receivables, then the Issuer has or will acquire all of Seller's right, title and interest in, to and under the such Receivables free and clear of any Lien or interest of any person at the time of transfer (and anytime thereafter with respect to any Lien or interest arising through or under the Seller except as provided in the Agreement), except for Liens for municipal or other local taxes permitted under Section 2.5(b) of the Agreement. 3. If the Assignment, together with the Agreement, does not constitute a valid assignment of all of the Seller's right, title and interest in, to and under the Receivables in Schedule 1 to the Assignment, then the Assignment ---------- creates a valid security interest in all the Seller's right, title and interest in, to and under such Receivable and the proceeds thereof in favor of the Issuer, which security interest is perfected and of first priority. Exhibit F-2-1 EXHIBIT F-3 PROVISIONS TO BE INCLUDED IN ANNUAL OPINION OF COUNSEL The opinions set forth below may be subject to certain qualifications, assumptions, limitations and exceptions taken or made in the opinion of counsel to Seller with respect to similar matters delivered on the Initial Closing Date. Unless otherwise indicated, all capitalized terms used herein shall have the meanings ascribed to them in the Transfer and Servicing Agreement. 1. No filing or other action, other than such filing or other action described in this opinion letter, is necessary from the date of this opinion letter through June 30 of the following year to continue the perfected status of the security interest of the Trust in the Receivables described in the financing statements referenced in this opinion letter. 2. No filing or other action, other than such filing or other action described in this opinion letter, is necessary from the date of this opinion letter through June 30 of the following year to continue the perfected status of the security interest of the Indenture Trustee in the Receivables described in the financing statements referenced in this opinion letter. Exhibit F-3-1 SCHEDULE 1 List of Accounts ---------------- [Original list delivered to Owner Trustee] 1-1 EX-4.4 6 0006.txt TRUST AGREEMENT AS OF MARCH 1, 2001 Exhibit 4.4 TRUST AGREEMENT between FIRST CONSUMERS NATIONAL BANK, as Seller, and BANKERS TRUST COMPANY, as Owner Trustee Dated as of March 1, 2001 TRUST AGREEMENT, dated as of March 1, 2001 (this "Agreement"), between --------- FIRST CONSUMERS NATIONAL BANK, a national banking association, as Seller, and BANKERS TRUST COMPANY, a New York banking corporation as Owner Trustee. ARTICLE I DEFINITIONS Section 1.1. Capitalized Terms. Capitalized terms used herein and not ----------------- otherwise defined herein are defined in Annex A to the Master Indenture, dated ------- as of the date hereof, between First Consumers Credit Card Master Note Trust and The Bank of New York. Section 1.2. Other Definitional Provisions. All terms defined directly ----------------------------- or by reference in this Agreement shall have the defined meanings when used in any certificate or other document delivered pursuant hereto unless otherwise defined therein. For purposes of this Agreement and all such certificates and other documents, unless the context otherwise requires: (a) accounting terms not otherwise defined in this Agreement, and accounting terms partly defined in this Agreement to the extent not defined, shall have the respective meanings given to them under generally accepted accounting principles; (b) terms defined in Article 9 of the UCC as in effect in the State of Illinois and not otherwise defined in this Agreement are used as defined in that Article; (c) any reference to each Rating Agency shall only apply to any specific rating agency if such rating agency is then rating any outstanding Series; (d) references to any amount as on deposit or outstanding on any particular date means such amount at the close of business on such day; (e) the words "hereof," "herein" and "hereunder" and words of similar import refer to this Agreement (or the certificate or other document in which they are used) as a whole and not to any particular provision of this Agreement (or such certificate or document); (f) references to any Section, Schedule or Exhibit are references to Sections, Schedules and Exhibits in or to this Agreement (or the certificate or other document in which the reference is made), and references to any paragraph, Section, clause or other subdivision within any Section or definition refer to such paragraph, subsection, clause or other subdivision of such Section or definition; (g) the term "including" means "including without limitation"; (h) references to any law or regulation refer to that law or regulation as amended from time to time and include any successor law or regulation; (i) references to any Person include that Person's successors and assigns; and (j) headings are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof. ARTICLE II ORGANIZATION Section 2.1. Name. The trust created hereby shall be known as "First ---- Consumers Credit Card Master Note Trust," in which name the Trust and Owner Trustee on behalf of the Trust each shall have power and authority and is hereby authorized and empowered to and may conduct the business of the Trust, make and execute contracts and other instruments on behalf of the Trust and sue and be sued. Section 2.2. Office. The office of the Trust shall be in care of the ------ Owner Trustee at the Corporate Trust Office or at such other address in the United States as the Owner Trustee may designate by written notice to the Seller and the Indenture Trustee. Section 2.3. Purpose and Powers. The purpose of the Trust is to engage ------------------ in the activities set forth in this Section 2.3. The Trust shall have power and ----------- authority and is hereby authorized and empowered, without the need for further action on the part of the Trust, and the Owner Trustee shall have power and authority, and is hereby authorized and empowered, in the name and on behalf of the Trust, to do or cause to be done all acts and things necessary, appropriate or convenient to cause the Trust, to engage in the activities set forth in this Section 2.3 as follows: - ----------- (i) to execute, deliver and issue the Notes pursuant to the Indenture, to issue the Seller Interest and to execute, issue and deliver the Supplemental Certificates, if any, pursuant to this Agreement; (ii) with the proceeds of the sale of the Notes, to acquire the Trust Estate and to pay the Seller the amounts owed pursuant to Section ------- 2.1 of the Transfer and Servicing Agreement; --- (iii) to assign, grant, pledge and mortgage the Collateral pursuant to the Indenture and to hold, manage and distribute to the holders of the Seller Interest pursuant to the terms of this Agreement and the Transaction Documents any portion of the Collateral released from the lien of, and remitted to the Trust pursuant to, the Indenture; (iv) to enter into, execute, deliver and perform the Transaction Documents to which it is to be a party; (v) to engage in those activities, including entering into agreements, that are necessary, suitable or convenient to accomplish the foregoing or are incidental thereto or connected therewith; and 2 (vi) subject to compliance with the Transaction Documents, to engage in such other activities as may be required in connection with conservation of the Trust Estate and the making of payments to the Noteholders and distributions to the holders of the Seller Interest. The Trust shall not have power, authority or authorization to, and shall not, engage in any activity other than in connection with the foregoing or other than as required or authorized by the Transaction Documents. Section 2.4. Appointment of Owner Trustee. The Seller hereby appoints ---------------------------- the Owner Trustee as trustee of the Trust effective as of the date hereof, to have all the rights, powers and duties set forth herein. Section 2.5. Initial Capital Contribution of Trust Estate. The Seller -------------------------------------------- hereby assigns, transfers, conveys and sets over to the Owner Trustee, as of the date hereof, the sum of $1. The Owner Trustee hereby acknowledges receipt in trust from the Seller, as of the date hereof, of the foregoing contribution, which shall constitute the initial Trust Estate and shall be held by the Owner Trustee. The Seller shall pay organizational expenses of the Trust as they may arise or shall, upon the request of the Owner Trustee, promptly reimburse the Owner Trustee for any such expenses paid by the Owner Trustee. Section 2.6. Declaration of Trust. The Owner Trustee hereby declares -------------------- that it will hold the Trust Estate in trust upon and subject to the conditions set forth herein for the use and benefit of the Seller, subject to the obligations of the Trust under the Transaction Documents to which it is a party. It is the intention of the parties hereto that the Trust constitute a trust under the laws of the State of Illinois and that this Agreement constitute the governing instrument of such trust. It is the intention of the parties hereto that, for income tax purposes, the Trust shall be treated as a security device and disregarded as an entity and its assets shall be treated as owned in whole by the Seller. The parties hereto agree that they will take no action contrary to the foregoing intention. Effective as of the date hereof, the Owner Trustee shall have all rights, powers and authority set forth herein and, to the extent not inconsistent herewith, in the laws of the State of Illinois with respect to accomplishing the purposes of the Trust. Section 2.7. Title to Trust Property. Legal title to all the Trust ----------------------- Estate shall be vested at all times in the Trust as a separate legal entity except where applicable law in any jurisdiction requires title to any part of the Trust Estate to be vested in a trustee or trustees, in which case title shall be deemed to be vested in the Owner Trustee, a co-trustee and/or a separate trustee, as the case may be. 3 Section 2.8. Situs of Trust. The Trust will be located and administered -------------- in the State of New York. All bank accounts maintained by the Owner Trustee on behalf of the Trust shall be located in the State of New York. The Trust shall not have any employees in any state other than New York or Illinois; provided, -------- however, that nothing herein shall restrict or prohibit the Owner Trustee from - ------- having employees within or without the State of New York. Payments will be received by the Trust only in New York or Illinois, and payments will be made by the Trust only from New York or Illinois. The only office of the Trust will be at the Corporate Trust Office. Section 2.9. Representations and Warranties of Seller. The Seller ---------------------------------------- hereby represents and warrants to the Owner Trustee (as such or in its individual capacity) that: (a) The Seller is a national banking association duly organized and validly existing in good standing under the laws of the United States and has full corporate power and authority to own its properties and to conduct its business as such properties are presently owned and such business is presently conducted, and to execute, deliver and perform its obligations under the Transaction Documents to which it is a party and to perform its obligations as contemplated thereby. (b) The Seller is duly qualified to do business and is in good standing (or is exempt from such requirement) in any State required in order to conduct its business, and has obtained all necessary licenses and approvals with respect to the Seller, in each jurisdiction in which failure to so qualify or to obtain such licenses and approvals would have a material adverse effect on its ability to perform its obligations under the Transaction Documents to which it is a party. (c) The execution and delivery of this Agreement and the consummation of the transactions provided for the Transaction Documents to which the Seller is a party have been duly authorized by the Seller by all necessary corporate action on its part. The Seller has the power and authority to assign the property to be assigned to and deposited with the Trust pursuant to Section 2.5 of this Agreement and Section 2.1 of the Transfer and Servicing Agreement. (d) The execution and delivery of the Transaction Documents to which the Seller is a party, the performance of the transactions contemplated by the Transaction Documents to which the Seller is a party and the fulfillment of the terms hereof and thereof will not conflict with or violate any Requirements of Law applicable to the Seller, or conflict with, result in any breach of any of the material terms and provisions of, or constitute (with or without notice or lapse of time or both) a material default under, any indenture, contract, agreement, mortgage, deed of trust or other instrument to which the Seller is a party or by which it or any of its properties are bound (other than violations of such indentures, contracts, agreements, 4 mortgages, deeds of trust or other instruments which, individually or in the aggregate, would not have a material adverse effect on the Seller's ability to perform its obligations under this Agreement). (e) There are no proceedings or investigations pending or, to the best knowledge of the Seller, threatened, against the Seller before any court, regulatory body, administrative agency, or other tribunal or governmental instrumentality having jurisdiction over the Seller (i) asserting the invalidity of any of the Transaction Documents to which the Seller is a party, (ii) seeking to prevent the consummation of any of the transactions contemplated by any of the Transaction Documents to which the Seller is a party, (iii) seeking any determination or ruling that, in the reasonable judgment of the Seller, would materially and adversely affect the performance by the Seller of its obligations under the Transaction Documents to which the Seller is a party, or (iv) seeking any determination or ruling that would materially and adversely affect the validity or enforceability of the Transaction Documents to which the Seller is a party. (f) This Agreement is legal, valid and enforceable against the Seller. Section 2.10. Liability of Beneficiaries. The holders of the Seller -------------------------- Interest shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware. ARTICLE III BENEFICIAL INTERESTS Section 3.1. Initial Ownership. The Seller, as the holder of the ----------------- Seller Interest (i) shall initially be the only beneficial owner of the Trust and (ii) shall be bound by the provisions of this Trust Agreement. Section 3.2. Seller Interest. The Seller Interest shall represent an --------------- undivided beneficial interest in the Trust Estate subject to the lien of the Notes created pursuant to the Indenture, including the right to receive Collections with respect to the Receivables and other amounts at the times and in the amounts specified in the Indenture and any Indenture Supplement to be paid to the holders of the Seller Interest. Section 3.3. Form of Seller Interest. The Seller Interest shall be an ------------------------ uncertificated interest in the Trust. 5 Section 3.4. Restrictions on Transfer; Issuance of Supplemental -------------------------------------------------- Certificates. At any time the Seller may sell, transfer, assign, participate, - ------------ pledge or otherwise dispose of the Seller Interest (or any interest therein) or may direct the Owner Trustee to issue a certificate representing an interest in the Seller Interest (a "Supplemental Certificate"). The form and terms of any ------------------------ interest in the Seller Interest or any Supplemental Certificate held by each such additional holder shall be defined in a supplement (a "Seller Interest --------------- Supplement") to this Agreement (which Seller Interest Supplement shall be - ---------- subject to Section 10.1 to the extent that it amends any of the terms of this ------------ Agreement) to be delivered to or upon the order of the Seller. The sale, transfer, assignment, participation, pledge or other disposition of the Seller Interest (or any interest therein) to any Person other than an Affiliate of Seller or the issuance of any such Supplemental Certificate to any Person other than an Affiliate of Seller shall be subject to satisfaction of the following conditions: (i) on or before the fifth day immediately preceding the issuance, the Seller shall have given the Owner Trustee, the Servicer, the Indenture Trustee and each Rating Agency notice (unless such notice requirement is otherwise waived) of such action; (ii) the Seller shall have delivered to the Owner Trustee and the Indenture Trustee the related Seller Interest Supplement in form satisfactory to the Owner Trustee and the Indenture Trustee, executed by each party hereto; (iii) the Rating Agency Condition shall have been satisfied with respect to such action; (iv) such action will not result in any Adverse Effect and the Seller shall have delivered to the Owner Trustee and the Indenture Trustee an Officer's Certificate, dated the date of such action to the effect that the Seller reasonably believes that such action will not, based on the facts known to such officer at the time of such certification, have an Adverse Effect and that all other conditions to such action have been satisfied; (v) the Seller shall have delivered to the Owner Trustee and Indenture Trustee (with a copy to each Rating Agency) a Tax Opinion, dated the date of such action with respect to such action and Opinions of Counsel to the effect that (A) such action will not subject the Trust to any state income tax or to the Illinois Personal Property Replacement Tax, and (B) such action, assignment, participation, pledge or other disposition does not require registration of the interest under the Securities Act or any state securities law except for any such registration that has been duly completed and become effective; and 6 (vi) the Aggregate Principal Balance shall not be less than the Minimum Aggregate Principal Balance, as of the date of such action after giving effect to such action. Notwithstanding the foregoing, any Supplemental Certificate or any interest in the Seller Interest held by the Seller or any other Person at any time on or after the date of its initial issuance may be transferred or exchanged only upon the delivery to the Owner Trustee and Indenture Trustee of a Tax Opinion dated as of the date of such transfer or exchange, as the case may be, with respect to such transfer or exchange, and compliance with any applicable Seller Interest Supplement. ARTICLE IV ACTIONS BY OWNER TRUSTEE Section 4.1. Prior Notice to Seller with Respect to Certain Matters. ------------------------------------------------------ With respect to the following matters, unless otherwise instructed by the Seller, the Trust shall not take action unless at least thirty (30) days before the taking of such action the Owner Trustee shall have notified the Seller: (a) the initiation of any claim or lawsuit by the Trust (other than an action to collect on the Trust Estate) and the settlement of any action, claim or lawsuit brought by or against the Trust (other than an action to collect on the Trust Estate); (b) the amendment of the Indenture by a supplemental indenture in circumstances where the consent of any Noteholder is required; (c) the amendment of the Indenture by a supplemental indenture in circumstances where the consent of any Noteholder is not required and such amendment materially adversely affects the interest of the Seller; (d) the amendment, change or modification of the Administration Agreement, except to cure any ambiguity or to amend or supplement any provision in a manner that would not materially adversely affect the interests of the Seller; or (e) the appointment pursuant to the Indenture of a replacement or successor Transfer Agent and Registrar or Indenture Trustee, or the consent to the assignment by the Transfer Agent and Registrar, Administrator or Indenture Trustee of its obligations under the Indenture. 7 Section 4.2. Restrictions on Power. The Owner Trustee shall not be --------------------- required to take or refrain from taking any action if such action or inaction would be contrary to any obligation of the Trust or the Owner Trustee (as such or in its individual capacity) under any of the Transaction Documents or would be contrary to Section 2.3. ----------- (b) The Owner Trustee shall have no power to create, assume or incur indebtedness or other liabilities in the name of the Trust other than as contemplated by the Transaction Documents. ARTICLE V AUTHORITY AND DUTIES OF OWNER TRUSTEE Section 5.1. General Authority. Each of the Trust and the Owner Trustee ----------------- in the name and on behalf of the Trust shall have power and authority, and is hereby authorized and empowered, to execute and deliver the Transaction Documents to which the Trust is to be a party and each certificate or other document attached as an exhibit to or contemplated by the Transaction Documents to which the Trust is to be a party, or any amendment thereto or other agreement, in each case, in such form as the Seller shall approve as evidenced conclusively by the Owner Trustee's execution thereof and the Seller's execution of the related documents. In addition to the foregoing, the Owner Trustee in the name and on behalf of the Trust shall also have power and authority and is hereby authorized and empowered, but shall not be obligated, to take all actions required of the Trust pursuant to the Transaction Documents. The Owner Trustee in the name and on behalf of the Trust shall also have power and authority and is hereby authorized and empowered from time to time to take such action as the Seller or the Administrator directs in writing with respect to the Transaction Documents. Section 5.2. General Duties. It shall be the duty of the Owner Trustee -------------- to discharge (or cause to be discharged) all of its responsibilities pursuant to the terms of this Agreement and the other Transaction Documents to which the Trust is a party and to administer the Trust in the interest of the Seller, subject to the Transaction Documents and in accordance with the provisions of this Agreement. Notwithstanding the foregoing, the Owner Trustee shall be deemed to have discharged its duties and responsibilities hereunder and under the other Transaction Documents to the extent the Administrator has agreed in the Administration Agreement or another Transaction Document to perform any act or to discharge any duty of the Owner Trustee or the Trust under any Transaction Document, and the Owner Trustee shall not be personally liable for the default or failure of the Administrator to carry out its obligations under the Administration Agreement. 8 Section 5.3. Action Upon Instruction. ----------------------- (a) The Owner Trustee shall not be required to take any action hereunder or under any other Transaction Document if the Owner Trustee shall have reasonably determined, or shall have been advised by counsel, that such action is likely to result in personal liability on the part of the Owner Trustee or is contrary to the terms of any Transaction Document or is otherwise contrary to law. (b) Whenever the Owner Trustee is unable to decide between alternative courses of action permitted or required by the terms of any Transaction Document, the Owner Trustee shall promptly give notice (in such form as shall be appropriate under the circumstances) to the Seller requesting instruction as to the course of action to be adopted, and to the extent the Owner Trustee acts or refrains from acting in good faith in accordance with any such instruction of the Seller received, the Owner Trustee shall not be personally liable on account of such action or inaction to any Person. If the Owner Trustee shall not have received appropriate instruction within ten (10) days of such notice (or within such shorter period of time as reasonably may be specified in such notice or may be necessary under the circumstances) it may, but shall be under no duty to, take or refrain from taking such action, not in violation of the Transaction Documents, as it shall deem to be in the best interest of the Seller, and shall have no personal liability to any Person for such action or inaction. (c) In the event that the Owner Trustee is unsure as to the application of any provision of any Transaction Document or any such provision is ambiguous as to its application, or is, or appears to be, in conflict with any other applicable provision, or in the event that this Agreement permits any determination by the Owner Trustee or is silent or is incomplete as to the course of action that the Owner Trustee is required to take with respect to a particular set of facts, the Owner Trustee may give notice (in such form as shall be appropriate under the circumstances) to the Seller requesting instruction and, to the extent that the Owner Trustee acts or refrains from acting in good faith in accordance with any such instruction received, the Owner Trustee shall not be personally liable, on account of such action or inaction, to any Person. If the Owner Trustee shall not have received appropriate instruction within ten (10) days of such notice (or within such shorter period of time as reasonably may be specified in such notice or may be necessary under the circumstances) it may, but shall be under no duty to, take or refrain from taking such action, not in violation of the Transaction Documents, as it shall deem to be in the best interests of the Seller, and shall have no personal liability to any Person for such action or inaction. Section 5.4. No Duties Except as Specified in this Agreement or in ----------------------------------------------------- Instructions. The Owner Trustee shall not have any duty or obligation to manage, - ------------ 9 make any payment with respect to, register, record, sell, dispose of, or otherwise deal with the Trust or the Trust Estate, or to otherwise take or refrain from taking any action under, or in connection with, this Agreement or any document contemplated hereby to which the Trust is a party, except as expressly provided by the terms of this Agreement or in any document or written instruction received by the Owner Trustee pursuant to Section 5.3; and no ----------- implied duties or obligations shall be read into any Transaction Document against the Owner Trustee. The Owner Trustee shall have no responsibility for any filing or recording, including filing any financing or continuation statement in any public office at any time or to otherwise perfect or maintain the perfection of any security interest or lien granted to it or the Trust hereunder or to prepare or file any Commission filing for the Trust or to record any Transaction Document. The Owner Trustee in its individual capacity nevertheless agrees that it will, at its own cost and expense, promptly take all action as may be necessary to discharge any liens on any part of the Trust Estate that result from actions by, or claims against, the Owner Trustee in its individual capacity that are not related to the ownership or the administration of the Trust Estate or the transactions contemplated by the Transaction Documents. Section 5.5. No Action Except under Specified Documents or --------------------------------------------- Instructions. The Owner Trustee shall not manage, control, use, sell, dispose of - ------------ or otherwise deal with any part of the Trust Estate except (i) in accordance with the powers granted to and the authority conferred upon the Owner Trustee pursuant to this Agreement, (ii) in accordance with the Transaction Documents and (iii) in accordance with any document or instruction delivered to the Owner Trustee pursuant to Section 5.3. ----------- Section 5.6. Restrictions. The Owner Trustee shall not take any action ------------ (a) that, to the actual knowledge of a Responsible Officer of the Owner Trustee, would violate the purposes of the Trust set forth in Section 2.3 or (b) that, to ----------- the actual knowledge of a Responsible Officer of the Owner Trustee, would result in the Trust's becoming taxable as a corporation for federal income tax purposes. The Seller shall not direct the Owner Trustee to take action that would violate the provisions of this Section 5.6. ----------- Section 5.7. Tax Returns. In the event the Trust shall be required to ----------- file tax returns, the Issuer shall prepare or shall cause to be prepared such tax returns and shall provide such tax returns to the Owner Trustee for signature at least five (5) days before such tax returns are due to be filed. The Issuer, in accordance with the terms of each Indenture Supplement, shall also prepare or shall cause to be prepared all tax information required by law to be distributed to Noteholders and shall deliver such information to the Owner Trustee at least five (5) days prior to the date it is required by law to be distributed to Noteholders. The Owner Trustee, upon request, will furnish the Issuer with all such information known to the Owner Trustee as may be reasonably required in connection with the preparation of all tax returns of the Trust, 10 and shall, upon request, execute such returns. In no event shall the Owner Trustee or the Indenture Trustee be liable for any liabilities, costs or expenses of the Trust or any Noteholder arising under any tax law, including federal, state or local income or excise taxes or any other tax imposed on or measured by income (or any interest or penalty with respect thereto arising from a failure to comply therewith). ARTICLE VI CONCERNING THE OWNER TRUSTEE Section 6.1. Acceptance of Trusts and Duties. The Owner Trustee accepts ------------------------------- the trusts hereby created and agrees to perform its duties hereunder with respect to such trusts, but only upon the terms of this Agreement. The Owner Trustee also agrees to disburse all moneys actually received by it constituting part of the Trust Estate upon the terms of the Transaction Documents. The Owner Trustee shall not be personally answerable or accountable under any Transaction Document under any circumstances, except (i) for its own willful misconduct, bad faith or gross negligence in the performance of its duties or the omission to perform any such duties or (ii) in the case of the inaccuracy of any representation or warranty contained in Section 6.3 expressly made by the Owner ----------- Trustee in its individual capacity. In particular, but not by way of limitation (and subject to the exceptions set forth in the preceding sentence): (a) the Owner Trustee shall not be personally liable for any error of judgment made in good faith by the Owner Trustee; (b) the Owner Trustee shall not be personally liable with respect to any action taken or omitted to be taken by it in accordance with the instructions of the Administrator or the Seller; (c) the Owner Trustee shall not be personally liable for any error of judgment made in good faith by the Holder of the Supplemental Certificate; (d) no provision of this Agreement or any other Transaction Document shall require the Owner Trustee to expend or risk funds or otherwise incur any personal financial liability in the exercise or performance of any of its duties, rights or powers hereunder or under any other Transaction Document, if the Owner Trustee shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured or provided to it (as such and in its individual capacity); 11 (e) under no circumstances shall the Owner Trustee be personally liable for indebtedness evidenced by or arising under any of the Transaction Documents, including the principal of and interest on the Notes; (f) the Owner Trustee shall not be personally responsible for or in respect of the validity or sufficiency of this Agreement, the due execution hereof by the Seller or the form, character, genuineness, sufficiency, value or validity of any of the Trust Estate, the Transaction Documents, the Notes or the Seller Interest, and the Owner Trustee shall in no event assume or incur any personal liability, duty, or obligation to any Noteholder, the Seller, any holder of the Seller Interest or any other Person, other than as expressly provided for herein or expressly agreed to in the other Transaction Documents; (g) the Owner Trustee shall not be personally liable for the default or misconduct of the Seller, the Servicer, the Administrator or the Indenture Trustee or any other Person under any of the Transaction Documents or otherwise, and the Owner Trustee shall have no obligation or personal liability to perform the obligations of the Trust under the Transaction Documents, including those that are required to be performed by the Administrator under the Administration Agreement, the Indenture Trustee under the Indenture or the Servicer under the Transfer and Servicing Agreement; (h) the Owner Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Agreement, or to institute, conduct or defend any litigation under this Agreement or otherwise or in relation to any Transaction Document, at the request, order or direction of the Seller, unless the Seller has offered to the Owner Trustee (as such and in its individual capacity) security or indemnity satisfactory to it against the costs, expenses and liabilities that may be incurred by the Owner Trustee therein or thereby. The right of the Owner Trustee to perform any discretionary act enumerated in any Transaction Document shall not be construed as a duty, and the Owner Trustee shall not be answerable or personally liable to any Person for any such act other than liability to the Trust and the beneficial owners of the Trust for its own gross negligence, bad faith or willful misconduct in the performance of any such act or the omission to perform any such act; and (i) Notwithstanding anything contained herein to the contrary, the Owner Trustee shall not be required to take any action in any jurisdiction other than in the State of New York or Illinois if the taking of such action will (i) require the registration with, licensing by or the taking of any other similar action in respect of, any State or other governmental authority or agency of any jurisdiction other than the State of New York or Illinois by or with respect to the Owner Trustee (as such or in its individual capacity); (ii) result in any fee, tax or other governmental charge under the laws of any jurisdiction or any political subdivisions thereof in existence on the 12 date hereof other than the State of New York or Illinois becoming payable by the Owner Trustee (as such or in its individual capacity); or (iii) subject the Owner Trustee (as such or in its individual capacity) to personal jurisdiction in any jurisdiction other than the State of New York or Illinois for causes of action arising from acts unrelated to the consummation of the transactions by the Owner Trustee contemplated hereby. The Owner Trustee shall be entitled to obtain advice of counsel (which advice shall be an expense of the Seller) to determine whether any action required to be taken pursuant to the Agreement results in the consequences described in clauses (i), (ii) and (iii) of the preceding sentence. In the event that said counsel advises the Owner Trustee that such action will result in such consequences, the Seller shall appoint an additional trustee pursuant to Section 9.5 to proceed with such action. ----------- Section 6.2. Furnishing of Documents. The Owner Trustee shall furnish ----------------------- to the Seller and the Indenture Trustee, promptly upon written request therefor, duplicates or copies of all reports, notices, requests, demands, certificates, financial statements and any other instruments furnished to the Owner Trustee under the Transaction Documents. Section 6.3. Representations and Warranties. The Owner Trustee (as such ------------------------------ and in its individual capacity) hereby represents and warrants to the Seller that: (a) It is a New York banking corporation duly organized and validly existing in good standing under the laws of the State of New York. It is qualified as a foreign fiduciary under the laws of the State of Illinois. It has all requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement. (b) It has taken all corporate action necessary to authorize the execution and delivery by it of this Agreement, and this Agreement will be executed and delivered by one of its officers who is duly authorized to execute and deliver this Agreement on its behalf. (c) Neither the execution nor the delivery by it of this Agreement, nor the consummation by it of the transactions contemplated hereby nor compliance by it with any of the terms or provisions hereof will contravene any federal, New York or Illinois law, governmental rule or regulation governing the banking or trust powers of the Owner Trustee (as such and in its individual capacity) or any judgment or order binding on it, or constitute any default under its charter documents or by-laws or any indenture, mortgage, contract, agreement or instrument to which it is a party or by which any of its properties may be bound. Section 6.4. Reliance; Advice of Counsel. --------------------------- 13 (a) The Owner Trustee shall incur no personal liability to anyone in acting upon any signature, instrument, notice, resolution, request, consent, order, certificate, report, opinion, bond, or other document or paper reasonably believed by it to be genuine and reasonably believed by it to be signed by the proper party or parties. The Owner Trustee may accept a certified copy of a resolution of the board of directors or other governing body of any Person as conclusive evidence that such resolution has been duly adopted by such body and that the same is in full force and effect. As to any fact or matter the method of the determination of which is not specifically prescribed herein, the Owner Trustee may for all purposes hereof rely on a certificate, signed by the president or any vice president or by the treasurer or other authorized officer of an appropriate Person, as to such fact or matter, and such certificate shall constitute full protection to the Owner Trustee for any action taken or omitted to be taken by it in good faith in reliance thereon. (b) In the exercise or administration of the trusts hereunder and in the performance of its duties and obligations under this Agreement or the other Transaction Documents, the Owner Trustee (i) may act directly or through its agents or attorneys pursuant to agreements entered into with any of them, and the Owner Trustee shall not be personally liable for the conduct or misconduct of such agents or attorneys if such agents or attorneys shall have been selected by the Owner Trustee with reasonable care, and (ii) may consult with counsel, accountants and other skilled Persons to be selected with reasonable care and employed by it. The Owner Trustee shall not be personally liable for anything done, suffered or omitted in good faith by it in accordance with the written opinion or written advice of any such counsel, accountants or other such Persons. Section 6.5. Not Acting in Individual Capacity. Except as expressly --------------------------------- provided in this Article VI, in accepting the trusts hereby created, Bankers ---------- Trust Company acts solely as Owner Trustee hereunder and not in its individual capacity, and all Persons having any claim against the Owner Trustee by reason of the transactions contemplated by any Transaction Document shall look only to the Trust Estate for payment or satisfaction thereof. Section 6.6. Owner Trustee Not Liable for Notes or Receivables. The ------------------------------------------------- statements contained herein and in the Notes and other Transaction Documents (other than the representations and warranties in Section 6.3) shall be taken as ----------- the statements of the Seller, and the Owner Trustee assumes no responsibility for the correctness thereof. The Owner Trustee makes no representations as to the validity or sufficiency of this Agreement or any other Transaction Document, the Notes or related documents. The Owner Trustee shall at no time have any responsibility or personal liability for or with respect to the legality, validity and enforceability of the Receivables or the perfection and priority of any security interest in the Receivables 14 or the maintenance of any such perfection and priority, or for or with respect to the sufficiency of the Trust Estate or its ability to generate the payments to be distributed to the Noteholders under the Indenture, including the existence, condition and ownership of the Receivables; the existence and contents of the Receivables on any computer or other record thereof; the validity of the assignment of the Receivables to the Trust or of any intervening assignment; the completeness of the Receivables; the performance or enforcement of the Receivables; the compliance by the Seller with any warranty or representation made under any Transaction Document or in any related document or the accuracy of any such warranty or representation or any action of the Administrator, the Servicer or the Indenture Trustee taken in the name of the Owner Trustee. Section 6.7. Owner Trustee May Own Notes. The Owner Trustee in its --------------------------- individual or any other capacity may become the owner or pledgee of Notes and may deal with the Seller, the Administrator, the Servicer and the Indenture Trustee in banking transactions with the same rights as it would have if it were not Owner Trustee. ARTICLE VII COMPENSATION OF OWNER TRUSTEE Section 7.1. Owner Trustee's Fees and Expenses. The Owner Trustee (in --------------------------------- its individual capacity) shall receive as compensation for its services hereunder such fees as have been separately agreed upon before the date hereof between the Seller and the Owner Trustee (in its individual capacity) (which compensation shall not be limited by any law on compensation of a trustee of an express trust), and the Owner Trustee (in its individual capacity) shall be entitled to be reimbursed by the Seller for its other reasonable expenses hereunder, including the reasonable compensation, expenses and disbursements of such agents, representatives, experts and counsel as the Owner Trustee may employ in connection with the exercise and performance of its rights and its duties hereunder and under the Transaction Documents; provided, however, that -------- ------- the Owner Trustee shall have no recourse to the assets pledged under the Indenture with respect to any payments pursuant to this Section 7.1 and the ----------- Owner Trustee's right to enforce such obligation shall be subject to the provisions of Section 10.8. ------------ Section 7.2. Indemnification. To the fullest extent permitted by law, --------------- the Seller shall indemnify, defend and hold harmless the Owner Trustee (as such and in its individual capacity) and its successors, assigns, directors, officers, agents, employees and servants (collectively, the "Indemnified ----------- Parties") from and against, any and all liabilities, obligations, losses, - ------- damages, taxes, claims, actions and suits, and any and all reasonable costs, expenses and disbursements (including reasonable 15 legal fees and expenses) of any kind and nature whatsoever (collectively, "Expenses") which may at any time be imposed on, incurred by, or asserted -------- against the Owner Trustee or any Indemnified Party in any way relating to or arising out of the Transaction Documents, the Trust Estate, the acceptance and administration of the Trust Estate or any action or inaction of the Owner Trustee; provided that the Seller shall not be liable for or required to -------- indemnify any Indemnified Party from and against Expenses arising or resulting from any of the matters described in the third sentence of Section 6.1 or ----------- Expenses for which indemnification is actually received under other Transaction Documents; provided further that the Seller shall not be liable for or required to indemnify an Indemnified Party from and against expenses arising or resulting from (i) the Indemnified Party's own willful misconduct, bad faith or gross negligence, or (ii) the inaccuracy of any representation or warranty contained in Section 6.3. No Indemnified Party shall have recourse to the assets pledged ----------- under the Indenture with respect to any Expenses payable by the Seller pursuant to this Section 7.2. An Indemnified Party's right to enforce such obligation ----------- shall be subject to the provisions of Section 10.8. The indemnities contained in ------------ this Section 7.2 shall survive the resignation and termination of the Owner ----------- Trustee or the termination of this Agreement. Section 7.3. Payments to the Owner Trustee. Any amounts paid to an ----------------------------- Indemnified Party pursuant to this Article VII shall not be construed to be a ----------- part of the Trust Estate. ARTICLE VIII TERMINATION OF TRUST AGREEMENT Section 8.1. Termination of Trust Agreement. ------------------------------ (a) The Trust shall dissolve upon the date specified by the Seller (the "Trust Termination Date", written notice of which shall be provided to the ---------------------- Owner Trustee), provided that the Trust Termination Date shall not be earlier -------- than the day on which the rights of all Series of Notes to receive payments from the Trust have terminated, and shall in no event be later than the Scheduled Trust Termination Date. After satisfaction of liabilities of the Trust as provided by applicable law, any money or other property held as part of the Trust Estate following such distribution shall be distributed to the Seller. The bankruptcy, liquidation, dissolution, termination, death or incapacity of the Seller shall not (x) operate to terminate this Agreement or annul, dissolve or terminate the Trust, or (y) entitle the Seller's legal representatives or heirs to claim an accounting or to take any action or proceeding in any court for a partition or winding up of all or any part of the Trust or Trust Estate or (z) otherwise affect the rights, obligations and liabilities of the parties hereto. 16 (b) Except as provided in Section 8.1(a), neither the Seller nor any -------------- holder of the Seller Interest shall be entitled to revoke, dissolve or terminate the Trust. ARTICLE IX SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES Section 9.1. Eligibility Requirements for Owner Trustee. The Owner ------------------------------------------ Trustee shall at all times be a Person within the State of Illinois, or authorized to act as a foreign fiduciary within the State of Illinois; authorized to exercise trust powers; having a combined capital and surplus of at least $50,000,000 and subject to supervision or examination by federal or state authorities; and having (or having a parent which has) a rating of at least Baa3 by Moody's, at least BBB- by Standard & Poor's and, if rated by Fitch, at least BBB- by Fitch, or otherwise satisfactory to each Rating Agency. If such Person shall publish reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purpose of this Section 9.1, the combined capital and surplus of such Person ----------- shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. In case at any time the Owner Trustee shall cease to be eligible in accordance with the provisions of this Section ------- 9.1, the Owner Trustee shall resign immediately in the manner and with the - --- effect specified in Section 9.2. ----------- Section 9.2. Resignation or Removal of Owner Trustee. The Owner Trustee --------------------------------------- may at any time resign and be discharged from the trusts hereby created by giving written notice thereof to the Seller; provided, however, that such -------- ------- resignation and discharge shall only be effective upon the appointment of a successor Owner Trustee. Upon receiving such notice of resignation, the Seller shall promptly appoint a successor Owner Trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to the resigning Owner Trustee and one copy to the successor Owner Trustee. If no successor Owner Trustee shall have been so appointed and have accepted appointment within thirty (30) days after the giving of such notice of resignation, the resigning Owner Trustee at the expense of the Seller may petition any court of competent jurisdiction for the appointment of a successor Owner Trustee. If at any time the Owner Trustee shall cease to be eligible in accordance with the provisions of Section 9.1 and shall fail to resign after ----------- written request therefor by the Seller, or if at any time the Owner Trustee shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or a receiver of the Owner Trustee or of its property shall be appointed, or any public officer shall take charge or control of the Owner Trustee or of its property or affairs for the purpose of rehabilitation, 17 conservation or liquidation, then the Seller may, but shall not be required to, remove the Owner Trustee. If the Seller shall remove the Owner Trustee under the authority of the immediately preceding sentence, the Seller shall promptly (i) appoint a successor Owner Trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to the outgoing Owner Trustee so removed and one copy to the successor Owner Trustee and (ii) pay all amounts owed to the outgoing Owner Trustee in its individual capacity. Any resignation or removal of the Owner Trustee and appointment of a successor Owner Trustee pursuant to any of the provisions of this Section 9.2 ----------- shall not become effective until acceptance of appointment by the successor Owner Trustee pursuant to Section 9.3 and, in the case of removal, payment of ----------- all fees and expenses owed to the outgoing Owner Trustee (as such or in its individual capacity). The Seller shall provide notice of such resignation or removal of the Owner Trustee to each Rating Agency. Section 9.3. Successor Owner Trustee. Any successor Owner Trustee ----------------------- appointed pursuant to Section 9.2 shall execute, acknowledge and deliver to the ----------- Seller and to its predecessor Owner Trustee an instrument accepting such appointment under this Agreement, and thereupon the resignation or removal of the predecessor Owner Trustee shall become effective and such successor Owner Trustee, without any further act, deed or conveyance, shall become fully vested with all the rights, powers, duties, and obligations of its predecessor under this Agreement, with like effect as if originally named as Owner Trustee. The predecessor Owner Trustee shall upon payment of its fees and expenses deliver to the successor Owner Trustee all documents and statements and monies held by it under this Agreement; and the Seller and the predecessor Owner Trustee shall execute and deliver such instruments and do such other things as may reasonably be required for fully and certainly vesting and confirming in the successor Owner Trustee all such rights, powers, duties, and obligations. No successor Owner Trustee shall accept appointment as provided in this Section 9.3 unless at the time of such acceptance such successor Owner Trustee - ----------- shall be eligible pursuant to Section 9.1. ----------- Upon acceptance of appointment by a successor Owner Trustee pursuant to this Section 9.3, the Seller shall mail notice of such acceptance of appointment ----------- including the name of such successor Owner Trustee to the Seller, the Indenture Trustee, the Noteholders and each Rating Agency. If the Seller shall fail to mail such notice within ten (10) days after acceptance of appointment by the successor Owner Trustee, the successor Owner Trustee shall cause such notice to be mailed at the expense of the Seller. 18 Section 9.4. Merger or Consolidation of Owner Trustee. Notwithstanding ---------------------------------------- anything herein to the contrary, any Person into which the Owner Trustee may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion or consolidation to which the Owner Trustee shall be a party, or any Person succeeding to all or substantially all of the corporate trust business of the Owner Trustee, shall be the successor of the Owner Trustee hereunder (provided that such Person shall meet the -------- eligibility requirements set forth in Section 9.1), without the execution or ----------- filing of any instrument or any further act on the part of any of the parties hereto; provided further that the Owner Trustee shall mail notice of such merger -------- ------- or consolidation to each Rating Agency and each Series Enhancer. Section 9.5. Appointment of Co-Trustee or Separate Trustee. --------------------------------------------- Notwithstanding any other provisions of this Agreement, at any time, for the purpose of meeting any legal requirements of any jurisdiction in which any part of the Trust Estate may at the time be located, the Seller and the Owner Trustee acting jointly shall have the power and shall execute and deliver all instruments to appoint one or more Persons approved by each of the Seller and the Owner Trustee to act as co-trustee, jointly with the Owner Trustee, or separate trustee or separate trustees, of all or any part of the Trust Estate, and to vest in such Person, in such capacity, such title to the Trust, or any part thereof, and, subject to the other provisions of this Section 9.5, such ----------- powers, duties, obligations, rights and trusts as the Seller and the Owner Trustee may consider necessary or desirable. If the Seller shall not have joined in such appointment within fifteen (15) days after the receipt by it of a request so to do, the Owner Trustee alone shall have the power to make such appointment. no co- trustee or separate trustee under this Agreement shall be required to meet the terms of eligibility as a successor trustee pursuant to Section 9.1 and no notice of the appointment of any co-trustee or separate - ----------- trustee shall be required pursuant to Section 9.3. ----------- Each separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions: (i) all rights, powers, duties, and obligations conferred or imposed upon the Owner Trustee shall be conferred upon and exercised or performed by the Owner Trustee and such separate trustee or co-trustee jointly (it being understood that such separate trustee or co-trustee is not authorized to act separately without the Owner Trustee joining in such act), except to the extent that under any law of any jurisdiction in which any particular act or acts are to be performed, the Owner Trustee shall be incompetent or unqualified to perform such act or acts, in which event such rights, powers, duties, and obligations (including the holding of title to the Trust or any portion thereof in any such jurisdiction) shall be exercised and 19 performed singly by such separate trustee or co-trustee, but solely at the direction of the Owner Trustee; (ii) no trustee under this Agreement shall be personally liable by reason of any act or omission of any other trustee under this Agreement; and (iii) the Seller and the Owner Trustee acting jointly may at any time accept the resignation of or remove any separate trustee or co-trustee. Any notice, request or other writing given to the Owner Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer to this Agreement and the conditions of this Article IX. Each separate trustee and co-trustee, upon ---------- its acceptance of the trusts conferred, shall be vested with the estates or property specified in its instrument of appointment, either jointly with the Owner Trustee or separately, as may be provided therein, subject to all the provisions of this Agreement, specifically including every provision of this Agreement relating to the conduct of, affecting the liability of, or affording protection to, the Owner Trustee. Each such instrument shall be filed with the Owner Trustee and a copy thereof given to the Seller. Any separate trustee or co-trustee may at any time appoint the Owner Trustee, its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Agreement on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by the Owner Trustee, to the extent permitted by law, without the appointment of a new or successor trustee. ARTICLE X MISCELLANEOUS Section 10.1. Supplements and Amendments. This Agreement may be amended -------------------------- from time to time, by a written amendment duly executed and delivered by the Seller and the Owner Trustee, without the consent of any of the Noteholders, to cure any ambiguity, to correct or supplement any provisions in this Agreement or to add any other provisions with respect to matters or questions raised under this Agreement which shall not be inconsistent with the provisions of this Agreement; provided, however, that such amendment will not, as evidenced by an -------- ------- Officer's Certificate of the Seller addressed and delivered to the Owner Trustee and the Indenture Trustee, materially and adversely affect the interest of any Noteholder. In addition, this Agreement may be amended from time to time, by a written 20 amendment duly executed and delivered by the Seller and the Owner Trustee, without the consent of any of the Noteholders, and upon satisfaction of the Rating Agency Condition, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or modifying in any manner the rights of the Noteholders; provided, however, that -------- ------- such amendment will not (i) as evidenced by an Officer's Certificate of the Seller addressed and delivered to the Owner Trustee and the Indenture Trustee, materially and adversely affect the interest of any Noteholder and (ii) as evidenced by an Opinion of Counsel addressed and delivered to the Owner Trustee and the Indenture Trustee, cause the Trust to be classified as an association (or a publicly traded partnership) taxable as a corporation for federal income tax purposes; provided, further, that Section 2.3 of this Agreement may be -------- ------- ----------- amended only with the consent of the Holders of Notes evidencing not less than a majority of the Outstanding Amount of the Notes. Additionally, notwithstanding the preceding sentence, this Agreement will be amended by the Seller and the Owner Trustee without the consent of the Indenture Trustee or any of the Noteholders to add, modify or eliminate such provisions as may be necessary or advisable in order to enable all or a portion of the Trust (i) to qualify as, and to permit an election to be made to cause the Trust to be treated as, a "financial asset securitization investment trust" as described in the provisions of Section 860L of the Code, and (ii) to avoid the imposition of state or local income or franchise taxes imposed on the Trust's property or its income; provided, however, that (i) the Seller delivers to the Indenture Trustee and the - -------- ------- Owner Trustee an Officer's Certificate to the effect that the proposed amendments meet the requirements set forth in this subsection, (ii) the Rating Agency Condition shall have been satisfied with respect to such amendment and (iii) such amendment does not affect the rights, benefits, protections, privileges, immunities, duties or obligations of the Owner Trustee hereunder. The amendments which the Seller may make without the consent of Noteholders pursuant to the preceding sentence may include the addition of a Seller of Receivables. This Agreement may also be amended from time to time by a written amendment duly executed and delivered by the Seller and the Owner Trustee, with the consent of the Indenture Trustee and the Holders of Notes evidencing not less than 66 2/3% of the Outstanding Amount of the Notes, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Noteholders; provided, however, that without the consent of all Noteholders, no -------- ------- such amendment shall (a) increase or reduce in any manner the amount of, or accelerate or delay the timing of distributions that are required to be made for the benefit of the Noteholders or (b) reduce the aforesaid percentage of the Outstanding Amount of the Notes, the Holders of which are required to consent to any such amendment; provided further, that such amendment will not, (i) as -------- ------- evidenced by an Officer's Certificate of the Seller addressed and delivered to the Owner Trustee and the Indenture Trustee, cause the 21 Trust to fail to be treated as a "qualified special purpose entity" as defined in SFAS Statement No. 125 or 140 and (ii) as evidenced by an Opinion of Counsel addressed and delivered to the Owner Trustee and the Indenture Trustee, cause the Trust to be classified as an association (or a publicly traded partnership) taxable as a corporation for federal income tax purposes. Promptly after the execution of any such amendment or consent, the Seller shall furnish written notification of the substance of such amendment or consent to the Indenture Trustee and each Rating Agency. It shall not be necessary for the consent of the Noteholders pursuant to this Section 10.1 to approve the particular form of any proposed amendment or ------------ consent, but it shall be sufficient if such consent shall approve the substance thereof The Owner Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Officer's Certificate of the Seller to the effect that the conditions to amendment have been satisfied. The Owner Trustee may, but shall not be obligated to, enter into, and unless it has consented thereto in writing shall not be bound by, any amendment which affects the Owner Trustee's own rights, duties, benefits, protections, privileges or immunities (as such or in its individual capacity) under this Agreement or otherwise. Section 10.2. No Legal Title to Trust Estate in Seller. The Seller ---------------------------------------- shall not have legal title to any part of the Trust Estate. No transfer, by operation of law or otherwise, of any right, title, and interest of the Seller to and in its undivided beneficial interest in the Trust Estate shall operate to terminate this Agreement or annul, dissolve or terminate the Trust or entitle any transferee to an accounting or to the transfer to it of legal title to any part of the Trust Estate. Section 10.3. Limitations on Rights of Others. The provisions of this ------------------------------- Agreement are solely for the benefit of the Owner Trustee (as such or in its individual capacity), the other Indemnified Parties, the Seller, and, to the extent expressly provided herein, the Indenture Trustee and the Noteholders, and nothing in this Agreement, whether express or implied, shall be construed to give to any other Person any legal or equitable right, remedy or claim in the Trust Estate or under or in respect of this Agreement or any covenants, conditions or provisions contained herein. Section 10.4. Notices. Unless otherwise expressly specified or ------- permitted by the terms hereof, all notices and other communications shall be in writing and shall be deemed given upon receipt by the intended recipient or three (3) Business Days after mailing if mailed by certified mail, postage prepaid (except that notice to the 22 Owner Trustee, the Seller or Indenture Trustee shall be deemed given only upon actual receipt by the Owner Trustee, the Seller or Indenture Trustee), if to the Owner Trustee, addressed to the Corporate Trust Office; if to the Indenture Trustee, addressed to The Bank of New York, 2 North LaSalle Street, Suite 1020, Chicago, Illinois 60602; if to the Seller, addressed to First Consumers National Bank, 9300 S.W. Gemini Drive, Beaverton, Oregon 97008; or, as to each party, at such other address as shall be designated by such party in a written notice to each other party. Section 10.5. Severability. Any provision of this Agreement that is ------------ prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. Section 10.6. Separate Counterparts. This Agreement may be executed by --------------------- the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument. Section 10.7. Successors and Assigns. All covenants and agreements ---------------------- contained herein shall be binding upon, and inure to the benefit of, the Seller and its permitted assignees and the Owner Trustee (as such or in its individual capacity) and its successors, all as herein provided. Any request, notice, direction, consent, waiver or other instrument or action by the Seller shall bind the successors and assigns of the Seller. Section 10.8. Non-petition Covenants. Notwithstanding any prior ---------------------- termination of the Trust or this Agreement, Bankers Trust Company, individually or in its capacity as Owner Trustee, shall not at any time with respect to the Trust or First Consumers Master Trust, acquiesce, petition or otherwise invoke or cause the Trust or First Consumers Master Trust to invoke the process of any court or governmental authority for the purpose of commencing or sustaining a case against the Trust or First Consumers Master Trust under any federal or state bankruptcy, insolvency or similar law or appointing a receiver, conservator, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Trust or First Consumers Master Trust or any substantial part of their respective properties, or ordering the winding up or liquidation of the affairs of the Trust or First Consumers Master Trust; provided, however, -------- ------- that this Section 10.8 shall not operate to preclude any remedy described in ------------ Article V of the Indenture. - --------- Notwithstanding any prior termination of the Trust or this Agreement, the Seller shall not at any time with respect to the Trust or First Consumers Master Trust, 23 acquiesce, petition or otherwise invoke or cause the Trust or First Consumers Master Trust to invoke the process of any court or governmental authority for the purpose of commencing or sustaining a case against the Trust or First Consumers Master Trust under any federal or state bankruptcy, insolvency or similar law or appointing a receiver, conservator, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Trust or First Consumers Master Trust or any substantial part of their respective properties, or ordering the winding up or liquidation of the affairs of the Trust or First Consumers Master Trust; provided, however, that this Section 10.8 shall not -------- ------- ------------ operate to preclude any remedy described in Article V of the Indenture. --------- Section 10.9. No Recourse. Each Person holding or owning the Seller ----------- Interest (or any interest therein), by accepting the Seller Interest (or its interest therein), acknowledges that the Seller Interest does not represent an interest in or obligation of the Servicer, the Owner Trustee (as such or in its individual capacity), the Indenture Trustee or any Affiliate thereof (other than the Trust), and no recourse may be had against such parties or their assets, or against the assets pledged under the Indenture, except as expressly provided in the Transaction Documents. Section 10.10. Headings. The headings of the various Articles and -------- Sections herein are for convenience of reference only and shall not define or limit any of the terms or provisions hereof. Section 10.11. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ------------- ACCORDANCE WITH THE LAWS OF THE STATE OF ILLINOIS, 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 10.12. Integration of Documents. This Agreement constitutes the ------------------------ entire agreement of the parties hereto and thereto with respect to the subject matter hereof and supersedes all prior agreements relating to the subject matter hereof. [Signature Page to Follow] 24 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective officers hereunto duly authorized, as of the day and year first above written. BANKERS TRUST COMPANY, as Owner Trustee By: /s/ Eileen M. Hughes -------------------- Name: Eileen M. Hughes Title: Vice President FIRST CONSUMERS NATIONAL BANK, as Seller By: /s/ John R. Steele ------------------ Name: John R. Steele Title: Treasurer First Consumers Credit Card Master Note Trust Trust Agreement Signature Page 25 TABLE OF CONTENTS
Page || ARTICLE I DEFINITIONS................................................................... 1 Section 1.1. Capitalized Terms............................................. 1 Section 1.2. Other Definitional Provisions................................. 1 ARTICLE II ORGANIZATION.................................................................. 2 Section 2.1. Name.......................................................... 2 Section 2.2. Office........................................................ 2 Section 2.3. Purpose and Powers............................................ 2 Section 2.4. Appointment of Owner Trustee.................................. 3 Section 2.5. Initial Capital Contribution of Trust Estate.................. 3 Section 2.6. Declaration of Trust.......................................... 3 Section 2.7. Title to Trust Property....................................... 3 Section 2.8. Situs of Trust................................................ 3 Section 2.9. Representations and Warranties of Seller...................... 4 Section 2.10. Liability of Beneficiaries.................................... 5 ARTICLE III BENEFICIAL INTERESTS.......................................................... 5 Section 3.1. Initial Ownership............................................. 5 Section 3.2. Seller Interest............................................... 5 Section 3.3. Form of Seller Interest...................................... 5 Section 3.4. Restrictions on Transfer; Issuance of Supplemental Certificates..................................... 5 ARTICLE IV ACTIONS BY OWNER TRUSTEE...................................................... 7 Section 4.1. Prior Notice to Seller with Respect to Certain Matters............................................... 7 Section 4.2. Restrictions on Power......................................... 7 ARTICLE V AUTHORITY AND DUTIES OF OWNER TRUSTEE......................................... 8 Section 5.1. General Authority............................................. 8 Section 5.2. General Duties................................................ 8 Section 5.3. Action Upon Instruction....................................... 8 Section 5.4. No Duties Except as Specified in this Agreement or in Instructions.................................. 9 Section 5.5. No Action Except under Specified Documents or Instructions..................................... 10 Section 5.6. Restrictions.................................................. 10 Section 5.7. Tax Returns................................................... 10
i ARTICLE VI CONCERNING THE OWNER TRUSTEE........................................... 11 Section 6.1. Acceptance of Trusts and Duties....................... 11 Section 6.2. Furnishing of Documents............................... 13 Section 6.3. Representations and Warranties........................ 13 Section 6.4. Reliance; Advice of Counsel........................... 13 Section 6.5. Not Acting in Individual Capacity..................... 14 Section 6.6. Owner Trustee Not Liable for Notes or Receivables..... 14 Section 6.7. Owner Trustee May Own Notes........................... 15 ARTICLE VII COMPENSATION OF OWNER TRUSTEE.......................................... 15 Section 7.1. Owner Trustee's Fees and Expenses..................... 15 Section 7.2. Indemnification....................................... 15 Section 7.3. Payments to the Owner Trustee......................... 16 ARTICLE VIII TERMINATION OF TRUST AGREEMENT......................................... 16 Section 8.1. Termination of Trust Agreement........................ 16 ARTICLE IX SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES............................................................... 16 Section 9.1. Eligibility Requirements for Owner Trustee............ 16 Section 9.2. Resignation or Removal of Owner Trustee............... 17 Section 9.3. Successor Owner Trustee............................... 18 Section 9.4. Merger or Consolidation of Owner Trustee.............. 18 Section 9.5. Appointment of Co-Trustee or Separate Trustee......... 18 ARTICLE X MISCELLANEOUS.......................................................... 20 Section 10.1. Supplements and Amendments............................ 20 Section 10.2. No Legal Title to Trust Estate in Seller.............. 22 Section 10.3. Limitations on Rights of Others....................... 22 Section 10.4. Notices............................................... 22 Section 10.5. Severability.......................................... 22 Section 10.6. Separate Counterparts................................. 22 Section 10.7. Successors and Assigns................................ 23 Section 10.8. Non-petition Covenants................................ 23 Section 10.9. No Recourse........................................... 23 Section 10.10. Headings.............................................. 24 Section 10.11. Governing Law......................................... 24 Section 10.12. Integration of Documents.............................. 24
|| ii EX-4.5 7 0007.txt ADMINISTRATION AGREEMENT AS OF MARCH 1, 2001 Exhibit 4.5 ----------- ADMINISTRATION AGREEMENT between FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST Issuer, and FIRST CONSUMERS NATIONAL BANK Administrator Dated as of March 1, 2001 TABLE OF CONTENTS 1. Duties of Administrator........................................... 2 2. Records........................................................... 6 3. Compensation...................................................... 6 4. Additional Information to be Furnished to Issuer.................. 7 5. Independence of Administrator..................................... 7 6. No Joint Venture.................................................. 7 7. Other Activities of Administrator................................. 7 8. Term of Agreement; Resignation and Removal of Administrator....... 7 9. Action upon Termination, Resignation or Removal................... 8 10. Notices........................................................... 8 11. Amendments........................................................ 9 12. Successors and Assigns............................................ 10 13. Governing Law..................................................... 10 14. Headings.......................................................... 10 15. Counterparts...................................................... 10 16. Severability...................................................... 10 17. Not Applicable to FCNB in Other Capacities........................ 10 18. Limitation of Liability of Owner Trustee.......................... 10 19. Third-Party Beneficiary........................................... 11 20. Nonpetition Covenants............................................. 11 21. Successor Administrator........................................... 11
i ADMINISTRATION AGREEMENT, dated as of March 1, 2001 (the "Administration -------------- Agreement"), between FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, a common law - --------- trust organized and existing under the laws of the State of Illinois (the "Issuer"), and FIRST CONSUMERS NATIONAL BANK, a national banking association, as ------ administrator (the "Administrator"). ------------- W I T N E S S E T H : WHEREAS, the Issuer has entered into a Master Indenture, dated as of March 1, 2001 (the "Indenture"), between the Issuer and The Bank of New York, as --------- indenture trustee (the "Indenture Trustee"), to provide for the issuance of its ----------------- asset backed notes (the "Notes") from time to time pursuant to one or more ----- indenture supplements. Capitalized terms used herein and not defined herein shall have the meanings assigned to such terms in Annex A to the Indenture; ------- WHEREAS, the Issuer has entered into certain agreements in connection with the issuance of the Notes, the issuance of the beneficial ownership interest of the Issuer and transactions related thereto, including (i) the Transfer and Servicing Agreement, (ii) the Trust Agreement, and (iii) the Indenture (the Transfer and Servicing Agreement, the Trust Agreement, the Indenture and all Indenture Supplements being hereinafter referred to collectively as the "Related ------- Agreements"); - ---------- WHEREAS, pursuant to the Related Agreements, the Issuer and the Owner Trustee are required to perform certain duties in connection with (a) the Notes and the Collateral and (b) the beneficial ownership interest in the Issuer; WHEREAS, the Issuer and the Owner Trustee desire to have the Administrator perform certain of the duties of the Issuer and the Owner Trustee referred to in the preceding clause, and to provide such additional services consistent with the terms of this Agreement and the Related Agreements as the Issuer and the Owner Trustee may from time to time request; and WHEREAS, the Administrator has the capacity to provide the services required hereby and is willing to perform such services for the Issuer and the Owner Trustee on the terms set forth herein; NOW, THEREFORE, in consideration of the mutual covenants contained herein, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows: 1. Duties of Administrator. ----------------------- (a) Duties with Respect to the Related Agreements. The Administrator shall --------------------------------------------- consult with the Owner Trustee regarding the duties of the Issuer and the Owner Trustee under the Related Agreements. The Administrator shall monitor the performance of the Issuer and shall advise the Owner Trustee when action is necessary to comply with the Issuer's or the Owner Trustee's duties under the Related Agreements. The Administrator shall prepare for execution by the Issuer or the Owner Trustee or shall cause the preparation by other appropriate persons of all such documents, reports, filings, instruments, orders, certificates and opinions as it shall be the duty of the Issuer or the Owner Trustee to prepare, file or deliver pursuant to any Related Agreement. In furtherance of the foregoing, the Administrator shall take all appropriate action that it is the duty of the Issuer or the Owner Trustee to take pursuant to the Indenture including such of the foregoing as are required with respect to the following matters under the Indenture (references are to sections of the Indenture): (i) the preparation of or obtaining of the documents and instruments required for execution, authentication and delivery of the Notes (whether upon initial issuance, transfer or exchange, or otherwise), if any, and delivery of the same to the Indenture Trustee (if applicable) (Sections -------- 2.3, 2.5, 2.6, 2.12(c) or 2.15); --- --- --- ------- ---- (ii) the duty to cause the Note Register to be kept, to appoint a successor Transfer Agent and Registrar, if necessary, and to give the Indenture Trustee notice of any appointment of a new Transfer Agent and Registrar and the location, or change in location, of the Note Register (Section 2.5); ----------- (iii) the furnishing of the Indenture Trustee, the Servicer, any Noteholder or the Paying Agent with the names and addresses of Noteholders after receipt of a written request therefor from the Indenture Trustee, the Servicer, any Noteholder or the Paying Agent, respectively, or as otherwise specified in the Indenture (Sections 2.9(a) and 7.1); --------------- --- (iv) the preparation, obtaining or filing of the instruments, opinions and certificates and other documents required for the release of collateral (Section 8.8); ----------- (v) the duty to cause the Issuer to maintain an office or agency within New York (and as otherwise set forth in an Indenture Supplement) and to give the Indenture Trustee and the Noteholders notice of the location, or change in location, of such office or agency (Section 3.2); ----------- (vi) the duty to direct the Indenture Trustee to deposit with any Paying Agent the sums specified in the Indenture and the preparation of an Issuer Order directing the investment of such funds in Permitted Investments (Section 3.3); ----------- 2 (vii) the duty to cause newly appointed Paying Agents, if any, to deliver to the Indenture Trustee the instrument specified in the Indenture regarding funds held in trust (Section 3.3); ----------- (viii) the direction to Paying Agents to pay to the Indenture Trustee all sums held in trust by such Paying Agents (Section 3.3); ----------- (ix) the duty to cause the Issuer to keep in full force its existence, rights and franchises as an Illinois trust and the obtaining and preservation of the Issuer's qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of the Indenture, the Notes, the Collateral and each other related instrument and agreement (Section 3.4); ----------- (x) the preparation of all supplements, amendments, financing statements, continuation statements, if any, instruments of further assurance and other instruments necessary to protect, maintain and enforce the Collateral (Section 3.5); ----------- (xi) the obtaining of the Opinion of Counsel on each Closing Date and the annual delivery of Opinions of Counsel as to the Collateral, and the annual delivery of the Officer's Certificate (Sections 3.6 and 3.9); ------------ --- (xii) the identification to the Indenture Trustee in an Officer's Certificate of a Person with whom the Issuer has contracted to assist it in performing its duties under the Indenture (Section 3.7(b)); -------------- (xiii) causing the delivery of notice by the Indenture Trustee to the Rating Agencies of the occurrence of any Servicer Default of which the Issuer has knowledge and the action, if any, being taken in connection with such default (Section 3.7(d)); -------------- (xiv) the delivery to the Indenture Trustee, within 120 days after the end of each fiscal year of the Issuer of an Officer's Certificate with respect to various matters relating to compliance with the Indenture (Section 3.9); ----------- (xv) the preparation and obtaining of documents, certificates, opinions and instruments required in connection with the consolidation or merger by the Issuer with or into any other Person or the sale of the Issuer's assets substantially as an entirety to any Person (Section 3.10); ------------ (xvi) the delivery of notice to the Indenture Trustee and the Rating Agencies of (1) each Event of Default and (2) each default by the Servicer or Seller under the Transfer and Servicing Agreement; 3 (xvii) the monitoring of the Issuer's obligations as to the satisfaction and discharge of the Indenture and the preparation of an Officer's Certificate and the obtaining of the Opinion of Counsel and the Independent Certificate relating thereto (Section 4.1); ----------- (xviii) the compliance with any directive of the Indenture Trustee with respect to the sale of the Collateral if an Event of Default shall have occurred and be continuing and the Notes have been accelerated (Section 5.5); ------------ (xix) the preparation of an Officer's Certificate to be delivered to the Indenture Trustee and the delivery of such Officer's Certificate to the Noteholders (Section 6.3(b)); -------------- (xx) the removal of the Indenture Trustee, if necessary and in compliance with the Indenture, and the appointment of a successor (Section ------- 6.8); --- (xxi) the preparation of various reports to be filed with the Indenture Trustee and the Commission, as applicable (Section 7.3); ----------- (xxii) notifying the Indenture Trustee if and when the Notes are listed on any stock exchange (Section 7.4); ----------- (xxiii) the preparation of an Issuer Order and Officer's Certificate and the obtaining of an Opinion of Counsel and Independent Certificates, if necessary, for the release of the Collateral (Section 8.9); ----------- (xxiv) the preparation of Issuer Orders, agreements, certificates, instruments, consents and other documents and the obtaining of Opinions of Counsel with respect to the execution of supplemental indentures (Sections -------- 3.7(f), 10.1, 10.2 and 10.3); ------ ---- ---- ---- (xxv) the execution of new Notes conforming to any supplemental indenture (Section 10.6); ------------ (xxvi) the preparation of all Officers' Certificates, Opinions of Counsel and, if necessary, Independent Certificates with respect to any requests by the Issuer to the Indenture Trustee to take any action under the Indenture (Section 12.1(a)); --------------- (xxvii) the preparation and delivery of Officers' Certificates and the obtaining of Independent Certificates, if necessary, in connection with the deposit of any Collateral or other property or securities with the Indenture Trustee that is to be made the basis for the release of property from the lien of the Indenture (Section 12.1(b)); --------------- (xxviii) the preparation and delivery to Noteholders and the Indenture Trustee of any agreements with respect to alternate payment and notice provisions (Section 12.6); and ------------ 4 (xxix) compliance with the provisions of the Transfer and Servicing Agreement, Indenture Supplement and Trust Agreement applicable to the Issuer. (b) Additional Duties. ----------------- (i) In addition to the duties of the Administrator set forth above, but subject to Sections 1(c)(ii) and 5, the Administrator shall -------- -------- - perform all duties and obligations of the Issuer under the Related Agreements, and shall perform such calculations and shall prepare for execution by the Issuer and shall cause the preparation by other appropriate persons of all such documents, reports, filings, instruments, certificates and opinions as it shall be the duty of the Issuer or the Owner Trustee to prepare, file or deliver pursuant to the Related Agreements and shall administer the Trust in the interest of the holder of the Seller Interest, and at the request of the Issuer shall take all appropriate action that it is the duty of the Issuer or the Owner Trustee to take pursuant to the Related Agreements. Subject to Sections 1(c)(ii) -------- -------- and 5 of this Agreement, and in accordance with the directions of the - Issuer, the Administrator shall administer, perform or supervise the performance of such other activities in connection with the Collateral (including the Related Agreements) as are not covered by any of the foregoing provisions and as are expressly requested by the Owner Trustee and are reasonably within the capability of the Administrator. (ii) The Administrator shall perform any duties expressly required to be performed by the Administrator under the Trust Agreement, including the preparation of tax returns pursuant to Section 5.7 of the Trust ----------- Agreement. (iii) In carrying out the foregoing duties or any of its other obligations under this Agreement, the Administrator may enter into transactions with or otherwise deal with any of its Affiliates; provided, however, that the terms of any such transactions or dealings shall be in accordance with any directions received from the Issuer and shall be, in the Administrator's opinion, no less favorable to the Issuer than would be available from unaffiliated parties. (iv) It is the intention of the parties hereto that the Administrator shall, and the Administrator hereby agrees to, prepare, file and deliver on behalf of the Issuer all such documents, reports, filings, instruments, certificates and opinions as it shall be the duty of the Issuer to prepare, file or deliver pursuant to the Related Agreements, including any filing, reports, notices, applications and registrations with, and seek any consents or authorizations from, the Securities and Exchange Commission and any state authority on behalf of the Issuer as may be necessary or advisable to comply with any federal or state securities or reporting requirements laws, to the extent not provided by the Servicer in accordance with Section 3.9 of the Transfer and Servicing Agreement. In ----------- furtherance thereof, the Owner Trustee shall, on behalf of the Issuer, execute and deliver to the Administrator and its agents, and to each successor Administrator appointed pursuant to the terms hereof, one or more powers of attorney substantially in the form of Exhibit A hereto, --------- appointing the 5 Administrator the attorney-in-fact of the Issuer for the purpose of executing on behalf of the Issuer all such documents, reports, filings, instruments, certificates and opinions. (c) Non-Ministerial Matters. ----------------------- (i) With respect to matters that in the reasonable judgment of the Administrator are nonministerial, the Administrator shall not take any action unless within a reasonable time before the taking of such action, the Administrator shall have notified Seller of the proposed action and Seller shall not have withheld consent or provided an alternative direction. For the purpose of the preceding sentence, "non-ministerial matters" shall include: (A) the amendment of or any supplement to the Indenture; (B) the initiation of any claim or lawsuit by the Issuer and the compromise of any action, claim or lawsuit brought by or against the Issuer (other than in connection with the collection or enforcement of the Collateral); (C) the amendment, change or modification of the Related Agreements; (D) the appointment of successor Transfer Agent and Registrars, successor Paying Agents and successor Indenture Trustees pursuant to the Indenture or the appointment of successor Administrators, or the consent to the assignment by the Transfer Agent and Registrar, Paying Agent or Indenture Trustee of its obligations under the Indenture; and (E) the removal of the Indenture Trustee. (ii) Notwithstanding anything to the contrary in this Agreement, the Administrator shall not be obligated to, and shall not, (x) make any payments from its own funds to the Noteholders, the Owner or any other Person under the Related Agreements, (y) sell the Collateral pursuant to Section 5.5 of the Indenture other than pursuant to a written directive of ----------- the Indenture Trustee or (z) take any other action that the Issuer directs the Administrator not to take on its behalf. 2. Records. The Administrator shall maintain appropriate books of ------- account and records relating to services performed hereunder, which books of account and records shall be accessible for inspection by the Issuer, the Owner Trustee, the Indenture Trustee, the Servicer and Seller at any time during normal business hours. 3. Compensation. As compensation for the performance of the ------------ Administrator's obligations under this Agreement, the Administrator shall be entitled to $100 per month which shall be payable in accordance with Section 3.2 of the Transfer and Servicing Agreement. Seller shall be responsible for payment of the Administrator's fees (to the extent not paid pursuant to Section 3.2 of the Transfer and Servicing Agreement). 6 4. Additional Information to be Furnished to Issuer. The Administrator ------------------------------------------------ shall furnish to the Issuer from time to time such additional information regarding the Collateral as the Issuer shall reasonably request. 5. Independence of Administrator. For all purposes of this Agreement, the ----------------------------- Administrator shall be an independent contractor and shall not be subject to the supervision of the Issuer or the Owner Trustee with respect to the manner in which it accomplishes the performance of its obligations hereunder. Unless expressly authorized by the Issuer, the Administrator shall have no authority to act for or represent the Issuer or the Owner Trustee in any way and shall not otherwise be deemed an agent of the Issuer or the Owner Trustee. 6. No Joint Venture. Nothing contained in this Agreement shall (i) ---------------- constitute the Administrator and either of the Issuer or the Owner Trustee as members of any partnership, joint venture, association, syndicate, unincorporated business or other separate entity, (ii) be construed to impose any liability as such on any of them or (iii) be deemed to confer on any of them any express, implied or apparent authority to incur any obligation or liability on behalf of the others. 7. Other Activities of Administrator. Nothing herein shall prevent the --------------------------------- Administrator or its Affiliates from engaging in other businesses or, in its sole discretion, from acting in a similar capacity as an administrator for any other person or entity even though such person or entity may engage in business activities similar to those of the Issuer, the Owner Trustee or the Indenture Trustee. 8. Term of Agreement; Resignation and Removal of Administrator. ----------------------------------------------------------- (a) This Agreement shall continue in force until the termination of the Issuer, upon which event this Agreement shall automatically terminate. (b) Subject to Sections 8(e) and (f), the Administrator may resign its duties hereunder by providing the Issuer with at least sixty (60) days prior written notice. (c) Subject to Sections 8(e) and (f), the Issuer may remove the Administrator without cause by providing the Administrator with at least sixty (60) days prior written notice. (d) Subject to Sections 8(e) and (f), at the sole option of the Issuer, the Administrator may be removed immediately upon written notice of termination from the Issuer to the Administrator if any of the following events shall occur: (i) the Administrator shall default in the performance of any of its duties under this Agreement and, after notice of such default, shall not cure such default within thirty (30) days (or, if such default cannot be cured in such time, shall not give within thirty (30) days such assurance of cure as shall be reasonably satisfactory to the Issuer); 7 (ii) a court having jurisdiction in the premises shall enter a decree or order for relief, and such decree or order shall not have been vacated within sixty (60) days, in respect of the Administrator in any involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect or appoint a receiver, conservator, liquidator, assignee, custodian, trustee, sequestrator or similar official for the Administrator or any substantial part of its property or order the winding up or liquidation of its affairs; or (iii) the Administrator shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, shall consent to the entry of an order for relief in an involuntary case under any such law, or shall consent to the appointment of a receiver, liquidator, assignee, trustee, custodian, sequestrator or similar official for the Administrator or any substantial part of its property, shall consent to the taking of possession by any such official of any substantial part of its property, shall make any general assignment for the benefit of creditors, shall admit in writing its inability to pay its debts generally as they become due or shall fail generally to pay its debts as they become due. The Administrator agrees that if any event specified in clause (ii) or (iii) of this Section 8(d) shall occur, it shall give written notice ------------ thereof to the Issuer and the Indenture Trustee within seven (7) days after the happening of such event. After obtaining knowledge of any event specified in clause (i), (ii) or (iii) of this Section 8(d), the Issuer ------------ shall give prompt written notice thereof to the Rating Agencies. (e) No resignation or removal of the Administrator pursuant to this Section 8 shall be effective until (i) a successor Administrator shall have been appointed by the Issuer and (ii) such successor Administrator shall have agreed in writing to be bound by the terms of this Agreement in the same manner as the Administrator is bound hereunder. (f) The appointment of any successor Administrator shall be effective only after satisfaction of the Rating Agency Condition with respect to the proposed appointment. 9. Action upon Termination, Resignation or Removal. Promptly upon the ----------------------------------------------- effective date of termination of this Agreement pursuant to Section 8(a) or the resignation or removal of the Administrator pursuant to Sections 8(b), (c) or (d), respectively, the Administrator shall be entitled to be paid all fees and reimbursable expenses accruing to it to the date of such termination, resignation or removal. The Administrator shall forthwith upon such termination pursuant to Section 8(a) deliver to Seller all property and documents of or relating to the Collateral then in the custody of the Administrator. In the event of the resignation or removal of the Administrator pursuant to Sections 8(b), (c) or (d), respectively, the Administrator shall cooperate with the Issuer and take all reasonable steps requested to assist the Issuer in making an orderly transfer of the duties of the Administrator. 8 10. Notices. Any notice, report or other communication given hereunder ------- shall be in writing and addressed as follows: (a) if to the Issuer or the Owner Trustee, to Bankers Trust Company, Four Albany Street, 10/th/ Floor, New York, New York 10006, Attn: Corporate Trust and Agency Services, with a copy to the Administrator; (b) if to the Administrator or the Seller to First Consumers National Bank, 9300 S.W. Gemini Drive, Beaverton, Oregon 97008, Attn: President; and (c) if to the Indenture Trustee, to The Bank of New York, 2 North LaSalle Street, Suite 1020, Chicago, Illinois 60602, Attn: Account Manager. or to such other address as any party shall have provided to the other parties in writing. Any notice required to be in writing hereunder shall be deemed given if such notice is mailed by certified mail, postage prepaid, or hand delivered to the address of such party as provided above, except that notices to the Indenture Trustee, Seller, the Administrator or the Issuer are effective only upon receipt. 11. Amendments. This Agreement may be amended from time to time, by a ---------- written amendment duly executed and delivered by the Issuer and the Administrator, with the written consent of the Owner Trustee (as such and in its individual capacity), without the consent of any of the Noteholders, Seller or the Owner, to cure any ambiguity, to correct or supplement any provisions in this Agreement or for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or modifying in any manner the rights of the Noteholders or Owner; provided, however, that such amendment will not, as evidenced by an Officer's Certificate of the Administrator addressed and delivered to the Owner Trustee, materially and adversely affect the interests of any Noteholder or the Owner. This Agreement may also be amended from time to time, by a written amendment duly executed and delivered by the Issuer and the Administrator, with the written consent of the Owner Trustee (as such and in its individual capacity), the holders of Notes evidencing not less than 66 2/3% of the Outstanding Amount of the Notes, Seller and the Owner, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or modifying in any manner the rights of Noteholders or the Owner; provided, however, that, without the consent of the Holders of all of the Notes then Outstanding, no such amendment shall (a) increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections of payments on the Receivables or distributions that are required to be made for the benefit of the Noteholders or (b) reduce the aforesaid portion of the Outstanding Amount of the Notes, the Holders of which are required to consent to any such amendment. Prior to the execution of any such amendment or consent, the Administrator shall furnish written notification of the substance of such amendment or consent to each Rating Agency. Promptly after the execution of any such amendment or consent, the Administrator shall furnish written notification of the substance of such amendment or consent to the Indenture Trustee. 9 It shall not be necessary for the consent of Noteholders pursuant to this Section 11 to approve the particular form of any proposed amendment or consent, but it shall be sufficient if such consent shall approve the substance thereof. 12. Successors and Assigns. This Agreement may not be assigned by the ---------------------- Administrator unless such assignment is previously consented to in writing by the Issuer, Seller and the Owner Trustee (as such and in its individual capacity) and subject to the satisfaction of the Rating Agency Condition in respect thereof. An assignment with such consent and satisfaction, if accepted by the assignee, shall bind the assignee hereunder in the same manner as the Administrator is bound hereunder. Notwithstanding the foregoing, this Agreement may be assigned by the Administrator without the consent of the Issuer, Seller, the Owner Trustee or the Rating Agencies to a corporation or other organization that is a successor (by merger, consolidation or purchase of assets) to the Administrator, provided that such successor organization executes and delivers to the Issuer, Seller and the Owner Trustee an agreement in which such corporation or other organization agrees to be bound hereunder by the terms of said assignment in the same manner as the Administrator is bound hereunder. Subject to the foregoing, this Agreement shall bind any successors or assigns of the parties hereto. 13. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH ------------- THE LAWS OF THE STATE OF ILLINOIS, 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. 14. Headings. The section headings hereof have been inserted for -------- convenience of reference only and shall not be construed to affect the meaning, construction or effect of this Agreement. 15. Counterparts. This Agreement may be executed in counterparts, each of ------------ which when so executed shall together constitute but one and the same agreement. 16. Severability. Any provision of this Agreement that is prohibited or ------------ unenforceable in any jurisdiction shall be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction. 17. Not Applicable to FCNB in Other Capacities. Nothing in this Agreement ------------------------------------------ shall affect any obligation FCNB may have in any other capacity, other than as Administrator. 18. Limitation of Liability of Owner Trustee. Notwithstanding anything ---------------------------------------- contained herein to the contrary, this instrument has been signed by Bankers Trust Company not in its individual capacity but solely in its capacity as Owner Trustee of the Issuer and in no event shall Bankers Trust 10 Company in its individual capacity or any beneficial owner of the Issuer have any liability for the representations, warranties, covenants, agreements or other obligations of the Issuer hereunder, as to all of which recourse shall be had solely to the assets of the Issuer. For all purposes of this Agreement, in the performance of any duties or obligations hereunder, 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. 19. Third-Party Beneficiary. The Owner Trustee is a third party ----------------------- beneficiary to this Agreement and is entitled to the rights and benefits hereunder and may enforce the provisions hereof as if it were a party hereto. 20. Nonpetition Covenants. Notwithstanding any prior termination of this --------------------- Agreement, the Administrator shall not at any time with respect to the Issuer or First Consumers Master Trust acquiesce, petition or otherwise invoke or cause the Issuer or First Consumers Master Trust to invoke the process of any court or government authority for the purpose of commencing or sustaining a case against the Issuer or First Consumers Master Trust under any Federal or state bankruptcy, insolvency or similar law or appointing a receiver, conservator, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Issuer or First Consumers Master Trust or any substantial part of their respective properties, or ordering the winding up or liquidation of the affairs of the Issuer or First Consumers Master Trust; provided, however, that this Section 20 shall not operate to preclude any remedy described in Article V of - ---------- the Indenture. 21. Successor Administrator. In the event of a servicing transfer ----------------------- pursuant to Article VII of the Transfer and Servicing Agreement, the successor servicer under the Transfer and Servicing Agreement shall, upon the date of such servicing transfer, become the successor Administrator hereunder. 11 IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and delivered as of the day and year first above written. FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST By: BANKERS TRUST COMPANY, not in its individual capacity but solely as Owner Trustee By: /s/ Eileen M. Hughes --------------------- Name: Eileen M. Hughes Title: Vice President FIRST CONSUMERS NATIONAL BANK, as Administrator By: /s/ John R. Steele -------------------- Name: John R. Steele Title: Treasurer Acknowledged and Accepted: FIRST CONSUMERS NATIONAL BANK, as Seller By: /s/ John R. Steele -------------------- Name: John R. Steele Title: Treasurer First Consumers Credit Card Master Note Trust 12 Administration Agreement Signature Page EXHIBIT A [Form of Power of Attorney] POWER OF ATTORNEY STATE OF ILLINOIS ) ) COUNTY OF COOK ) KNOW ALL MEN BY THESE PRESENTS, that First Consumers Credit Card Master Note Trust, a Illinois trust ("Trust"), does hereby make, constitute and appoint First Consumers National Bank, as Administrator under the Administration Agreement (as defined below), and its agents and attorneys, as Attorneys-in-Fact to execute on behalf of the Trust all such documents, reports, filings, instruments, certificates and opinions as it shall be the duty of the Trust to prepare, file or deliver pursuant to the Related Agreements (as defined in the Administration Agreement), including to appear for and represent the Trust in connection with the preparation, filing and audit of federal, state and local tax returns pertaining to the Trust, and with full power to perform any and all acts associated with such returns and audits that the Trust could perform, including the right to distribute and receive confidential information, defend and assert positions in response to audits, initiate and defend litigation, and to execute waivers of restriction on assessments of deficiencies, consents to the extension of any statutory or regulatory time limit, and settlements. For the purpose of this Power of Attorney, the term "Administration Agreement" means the Administration Agreement, dated as of March 1, 2001, between the Trust and First Consumers National Bank, as Administrator, and as such may be amended from time to time. This power of attorney is coupled with an interest and shall survive and not be affected by the subsequent bankruptcy or dissolution of the Trust. All powers of attorney for this purpose heretofore filed or executed by the Trust are hereby revoked. EXECUTED this ____ day of _________, 2001. FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST By: BANKERS TRUST COMPANY, not in its individual capacity but solely as Owner Trustee By:_________________________________ Name: Title: EX-4.6 8 0008.txt COLLATERAL SERIES SUPPLEMENT INCLUDING FORM OF - -------------------------------------------------------------------------------- Exhibit 4.6 ----------- FIRST CONSUMERS NATIONAL BANK, Seller and Servicer, and THE BANK OF NEW YORK, Trustee on behalf of the Collateral Certificateholder - -------------------------------------------------------------------------------- COLLATERAL SERIES SUPPLEMENT Dated as of March 1, 2001 to AMENDED AND RESTATED POOLING AND SERVICING AGREEMENT Dated as of February 1, 1999 - -------------------------------------------------------------------------------- FIRST CONSUMERS MASTER TRUST - -------------------------------------------------------------------------------- TABLE OF CONTENTS
Page SECTION 1. Designation........................................................ 1 SECTION 2. Definitions........................................................ 2 SECTION 3. Reassignment and Transfer Terms.................................... 3 SECTION 4. Delivery and Payment for the Collateral Certificates............... 3 SECTION 5. Form of Delivery of Collateral Certificates........................ 3 SECTION 6. Article IV of Agreement............................................ 4 SECTION 7. Series Pay Out Events and Events of Default; Servicer Defaults..... 4 SECTION 8. Successors and Assigns............................................. 5 SECTION 9. Modification to and Ratification of Agreement...................... 5 SECTION 10. Counterparts....................................................... 5 SECTION 11. Governing Law...................................................... 5
EXHIBITS Exhibit A Form of Collateral Certificate COLLATERAL SERIES SUPPLEMENT dated as of March 1, 2001 (this "Series Supplement"), among First Consumers National Bank, a national banking association, as Seller and Servicer, and The Bank of New York (as successor-in- interest to the corporate trust administration of Harris Trust and Savings Bank), as Trustee under the Amended and Restated Pooling and Servicing Agreement dated as of February 1, 1999 among Seller, the Servicer and the Trustee (the "Agreement"). Section 6.12 of the Agreement provides, among other things, that Seller and the Trustee may at any time and from time to time enter into a supplement to the Agreement for the purpose of authorizing the delivery by Seller to the Trustee for execution and authentication of one or more Series of Investor Certificates. Pursuant to this Series Supplement, Seller shall create a new Series of Investor Certificates and shall specify the Principal Terms thereof and add and amend certain provisions of the Agreement. SECTION 1. Designation. There is hereby created a Series of Investor ----------- Certificates to be issued pursuant to the Agreement and this Series Supplement to be known as the "Collateral Certificates." The Collateral Certificates will be transferred by the Seller to First Consumers Credit Card Master Note Trust (the "Note Trust") pursuant to a Transfer and Servicing Agreement dated as of March 1, 2001 among the Seller, the Servicer and First Consumers Credit Card Master Note Trust. The Note Trust will pledge the Collateral Certificates as collateral for one or more series of notes (each, a "Note Series") to be issued by the Note Trust pursuant to a Master Indenture dated as of March 1, 2001 between First Consumers Credit Card Master Note Trust, and The Bank of New York, as indenture trustee, and one or more supplements to the Master Indenture (each, an "Indenture Supplement" and, together with the Master Indenture referred to above, the "Indenture"). The portions of the Collateral Certificates primarily securing each Note Series shall be treated as separate Series (each, a "Collateral Series") under the Agreement and this Series Supplement. Certain terms pertaining to each Collateral Series will be defined in the applicable Indenture Supplements (but are hereby incorporated by reference into this Series Supplement). Unless and until the Trust has been terminated as permitted by Section 3(b) of this Series Supplement: (a) each Indenture Supplement executed and delivered by the Note Trust shall be deemed to supplement this Series Supplement; (b) a new Collateral Series shall be deemed to be issued upon the issuance of each Note Series and shall have the same designation (e.g., Series 2001-A) as the related Note Series; (c) the amounts payable as interest and principal on such Collateral Series shall equal the aggregate of the amounts payable on the related Note Series and shall be payable at the times and in the amounts specified for such Note Series, (d) all amounts available and applied as credit enhancement with respect to such Note Series shall be deemed to be available and applied as credit enhancement with respect to such Collateral Series; (e) all amounts payable to the Seller pursuant to the related Indenture Supplement shall be deemed to be payable to the Seller pursuant to this Series Supplement; and (f) the conditions defined in Section 6.12 of the Agreement for issuance of new Series must be satisfied in connection with each issuance of a Note Series; provided, however, that the Opinion of Counsel required in clause (D) of the - -------- ------- sixth sentence of Section 6.12(b) shall not be required to include the opinion in subclause (4) of such clause (D) to the effect that the Collateral Certificate established pursuant to this Series Supplement will be properly characterized as debt. SECTION 2. Definitions. If any term or provision contained herein ----------- shall conflict with or be inconsistent with any provision contained in the Agreement, the terms and provisions of this Series Supplement shall govern. All Article, Section or subsection references herein shall mean Article, Section or subsections of the Agreement, as amended or supplemented by this Series Supplement, except as otherwise provided herein. All capitalized terms not otherwise defined herein are used herein as defined in the Agreement. Each capitalized term defined herein shall relate only to the Collateral Certificates and no other Series of Certificates issued by the Trust. "Base Rate" is defined for each Collateral Series in the related Indenture Supplement. "Certificate" means a Collateral Certificate. "Certificateholder" means the holder of record of any Certificate. "Certificate Rate" means, for any Collateral Series, the average of the interest rates applicable to the notes in the related Note Series, weighted by the outstanding principal amount of the applicable classes of notes. "Closing Date" means, for any Collateral Series, the "Closing Date" for the related Note Series, as defined in the related Indenture Supplement. "Collateral Certificates" is defined in Section 1 of this Series Supplement. "Collateral Series" is defined in Section 1 of this Series Supplement. "Enhancement Provider" if applicable to any Collateral Series will be the "Enhancement Provider" defined in the related Indenture Supplement. "Finance Charge Shortfall" means, for any Collateral Series, the Finance Charge Shortfall for the related Note Series, as defined in the related Indenture Supplement. "Indenture" is defined in Section 1 of this Series Supplement. "Indenture Supplement" is defined in Section 1 of this Series Supplement. "Initial Investor Amount" means, for any Collateral Series, the "Initial Collateral Amount" of the related Note Series, as defined in the related Indenture Supplement. -2- "Investor Amount" means, for any Collateral Series, the "Collateral Amount" of the related Note Series, as defined in the related Indenture Supplement. "Minimum Seller Percentage" is defined for each Collateral Series in the related Indenture Supplement. "Net Recoveries" means, for any Collateral Series, with respect to any Monthly Period, the excess, if any, of Recoveries collected during such Monthly Period over the aggregate amount of Principal Receivables in Defaulted Accounts charged off during such Monthly Period. "Note Series" is defined in Section 1 of this Series Supplement. "Note Trust" is defined in Section 1 of this Series Supplement. "Principal Shortfall" means, for any Collateral Series, the Principal Shortfall for the related Note Series, as defined in the related Indenture Supplement. "Rating Agency" means, for any Collateral Series, the rating agencies for the related Note Series, as defined in the related Indenture Supplement. "Series Accounts" means, for any Collateral Series, any bank accounts established for the benefit of the related Note Series, as defined in the related Indenture Supplement. "Series Servicing Fee Percentage" is defined for each Collateral Series in the related Indenture Supplement. "Series Termination Date" means, for any Collateral Series, the final maturity date for the related Note Series defined in the related Indenture Supplement. SECTION 3. Reassignment and Transfer Terms. ------------------------------- (a) If the Servicer purchases, redeems or prepays any Note Series pursuant to a clean-up call under the related Indenture Supplement, then the related Collateral Series shall be deemed to have been retired. (b) Once each Series of Certificates issued under the Agreement has been retired, other than the Collateral Series and any other Series the requisite holders of which have consented to the following transactions, the holder of the Seller Interest shall have the option to transfer the Seller Interest to the Note Trust, upon which transfer the Trust shall terminate, and all of the Trust Assets shall be distributed to the Note Trust, as holder of all of the beneficial interests in the Trust. -3- SECTION 4. Delivery and Payment for the Collateral Certificates. ---------------------------------------------------- The Trustee shall deliver the Collateral Certificates when authenticated in accordance with Section 6.2. SECTION 5. Form of Delivery of Collateral Certificates. ------------------------------------------- (1) The Collateral Certificates shall be delivered as Definitive Certificates. (2) For purposes of voting with respect to any consent or other matter under the Agreement or this Series Supplement, each class of notes included in any Note Series shall be deemed to be a Class of Certificates in the related Collateral Series, and the provisions for voting by beneficial owners of such notes specified in the Indenture shall apply mutatis mutandis to voting under the Agreement and this Series Supplement. SECTION 6. Article IV of Agreement. (a) Sections 4.1, 4.2 and ----------------------- 4.3 of the Agreement shall read in their entirety as provided in the Agreement; provided that notwithstanding anything to the contrary in the third sentence of - -------- Section 4.2(e), unless otherwise specified in an Indenture Supplement, on each Distribution Date, a portion of interest and investment earnings (net of losses and investment expenses) on funds on deposit in the Collection Account and the Excess Funding Account shall be allocated to each Collateral Series based on the Investor Percentage with respect to Finance Charge Receivables for such Series and deposited in the Finance Charge Subaccount for that Series. The remainder of Article IV of the Agreement shall read in its entirety as follows and shall be applicable only to the Collateral Certificates: ARTICLE IV RIGHTS OF CERTIFICATEHOLDERS AND ALLOCATION AND APPLICATION OF COLLECTIONS Section 4.1A Rights of Investor Certificateholders. The Collateral ------------------------------------- Certificates shall represent Undivided Interests in the Trust, consisting of the right to receive (a) the related Allocation Percentage (as defined in the related Indenture Supplement) of Collections, (b) funds on deposit in the Collection Account and the Excess Funding Account allocable to the Collateral Certificates and (c) Shared Principal Collections allocated to the Collateral Certificates in accordance with subsection 4.3(g). Unless otherwise specified in the related Indenture Supplement, each Collateral Series shall consist of a single Class and shall not be senior or subordinated to any other Series. The Seller Interest shall represent the ownership interest in the Trust Assets not allocated to the Collateral Certificates or any other Series outstanding; provided, however, the ownership interest represented by the Seller Interest and - -------- ------- any other Series outstanding shall not represent any interest in the Collection Account or any other Series Account, except as specifically provided in this Article IV. - ---------- -4- Section 4.4 Allocations. The Servicer shall, prior to the close of ----------- business on the day any Collections are deposited in the Collection Account, allocate from the Collection Account to the Collateral Series related to each Note Series the amounts specified in the related Indenture Supplement, which shall be deposited or otherwise applied as provided in such Indenture Supplement. SECTION 7. Series Pay Out Events and Events of Default; Servicer ----------------------------------------------------- Defaults. The Series Pay Out Events applicable to each Collateral Series shall - -------- be the Series Pay Out Events specified in the related Indenture Supplement, as well as the Trust Pay Out Events specified in the Indenture. In addition, each Note Series will have the benefit of applicable "Events of Default," as defined in the Indenture. Upon the occurrence of an applicable Event of Default, the Indenture Trustee shall have the right to foreclose upon a portion of the Receivables, as defined (and subject to the limitations stated) in the Indenture notwithstanding the continuing existence of the Trust. In addition, each Servicer Default specified in the Master Indenture shall be an additional Servicer Default for purposes of each Collateral Series. SECTION 8. Successors and Assigns. This Series Supplement shall ---------------------- be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns. SECTION 9. Modification to and Ratification of Agreement. For --------------------------------------------- purposes of this Supplement and each Collateral Series: (a) Section 2.6(a) shall be deemed to read as follows: "(a) If either (i) on any Record Date, the Aggregate Principal Balance is less than the Minimum Aggregate Principal Balance, or (ii) on any day the Aggregate Principal Balance is less than the greater of (A) the sum of the Aggregate Investor Amount, plus the Minimum Seller Amount, in each case as of such date and (B) the sum of the numerators used to determine the Investor Percentages for Principal Collections for all Series outstanding on such date, either Seller or Servicer (whichever shall first become aware of the same) promptly shall give the Trustee written notice thereof, and as soon as practicable (but in no event later than 10 days thereafter) Seller shall designate additional Eligible Accounts ("Additional Accounts") to be included as Accounts and shall ------------------- transfer the Receivables in such Additional Accounts to the Trust, in a sufficient amount so that (x) in the case of clause (i) above, the Aggregate Principal Balance on such Record Date would have, if the Receivables from such Additional Accounts had been transferred to the Trust on or prior to such Record Date, at least equalled the Minimum Aggregate Principal Balance and (y) in the case of clause (ii) above, Aggregate Principal Balance on such day would have, if the Receivables from such Additional Accounts had been transferred to the Trust on or prior to such day, at least equalled the greater -5- of the amounts described in clauses (ii)(A) and (ii)(B) above. If Seller fails to transfer Receivables as required by the preceding sentence, then the Trustee shall give Seller immediate notice thereof;" and (b) Section 2.6(b) shall be deemed to read as follows: "(b) In addition to its obligation under subsection 2.6(a), Seller may, but shall not be obligated to, from time to time, designate Additional Accounts to be included as Accounts, so long as after giving effect to such addition no more than 20% of the Receivables, by outstanding balance , will be 30 or more days delinquent." (c) the following new clause (d) is added at the end of Section 2.7(b)(iii) of the Agreement: "and (d) Accounts (or administratively convenient groups of Accounts, such as billing cycles) were chosen for removal randomly or otherwise not on a basis intended to select particular accounts or groups of accounts for any reason other than administrative convenience;" (d) notwithstanding anything to the contrary in Section 3.2 of the Agreement, the servicing fee payable with respect to each Note Series and the related Collateral Series shall be solely as set forth in the related Indenture Supplement; (e) the second paragraph in Section 4.3(e) shall be deemed to read as follows: "In the event that the exclusion of the amount of a Credit Adjustment from the calculation of the Seller Amount would cause the Seller Amount to be less than the Minimum Seller Amount, Seller shall make a deposit, no later than the Business Day following the Date of Processing of such Credit Adjustment, in the Excess Funding Account in immediately available funds, in an amount equal to the amount by which the Minimum Seller Amount exceeds the Seller Amount, after giving effect to such exclusion." (f) Section 12.2(b),other than the first sentence thereof, shall not be applicable to any Collateral Series. In addition, to the extent that the terms of this Series Supplement (directly or as supplemented by any Indenture Supplement) are deemed to be inconsistent with the terms of the Agreement, this Series Supplement shall be deemed to modify or amend the terms of the Agreement solely as applied to each Collateral Series affected by any such inconsistency, as permitted by Section 6.12(c) of the Agreement. Otherwise, as supplemented by this Series Supplement (and the various Indenture Supplements executed form time to time), the Agreement -6- is in all respects ratified and confirmed and the Agreement as so amended and supplemented by this Series Supplement shall be read, taken and construed as one and the same instrument. SECTION 10. Counterparts. This Series Supplement may be executed ------------ in any number of counterparts, each of which so executed shall be deemed to be an original, but all of such counterparts shall together constitute but one and the same instrument. SECTION 11. Governing Law. This Series Supplement shall be ------------- construed in accordance with the laws of the State of Illinois, 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. -7- IN WITNESS WHEREOF, the parties have caused this Collateral Series Supplement to be duly executed by their respective officers as of the day and year first above written. FIRST CONSUMERS NATIONAL BANK, as Seller and Servicer By: /s/ John R. Steele -------------------- Name: John R. Steele Title: Treasurer THE BANK OF NEW YORK, (successor-in-interest to the corporate trust administration of Harris Trust and Savings Bank), as Trustee By: /s/ Greg Anderson ------------------- Name: Greg Anderson Title: Authorized Agent First Consumers Credit Card Master Note Trust -8- Collateral Series Supplement Signature Page -9- EXHIBIT A to COLLATERAL SERIES SUPPLEMENT FORM OF COLLATERAL CERTIFICATE No.___________________ $__________________________ FIRST CONSUMERS MASTER TRUST COLLATERAL CERTIFICATE Evidencing an undivided interest in a trust originated by First Consumers National Bank ("FCNB"), the corpus of which consists of a portfolio of receivables created under charge accounts originated by FCNB and other assets and interests constituting the trust under the Pooling and Servicing Agreement described below. (Not an interest in or obligation of FCNB) This certifies that FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST (the "Certificateholder") is the registered owner of an undivided interest in a trust (the "Trust"), the corpus of which consists of a portfolio of receivables (the "Receivables") now existing or hereafter created under selected charge accounts originated by FCNB and transferred to the Trust, all monies due or to become due with respect thereto and the other assets and interests constituting the Trust pursuant to an Amended and Restated Pooling and Servicing Agreement, dated as of February 1, 1999, as amended and supplemented, including by the Collateral Series Supplement, dated as of March 1, 2001 (collectively, the "Pooling and Servicing Agreement"), among FCNB and The Bank of New York (as successor-in- interest to the corporate trust administration of Harris Trust and Savings Bank), as trustee. THIS COLLATERAL CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, FCNB, AND NONE OF THIS CERTIFICATE, THE RECEIVABLES AND THE ACCOUNTS IS INSURED OR GUARANTEED BY THE FDIC OR ANY OTHER GOVERNMENTAL AGENCY. THIS COLLATERAL CERTIFICATE IS LIMITED IN RIGHT OF PAYMENT TO CERTAIN COLLECTIONS RESPECTING THE RECEIVABLES, ALL AS MORE SPECIFICALLY SET FORTH IN THE POOLING AND SERVICING AGREEMENT. To the extent not defined herein, capitalized terms used herein have the meanings assigned in the Pooling and Servicing Agreement. This Collateral Certificate is issued under and is subject to the terms, provisions and conditions of the Pooling and Servicing Agreement, to which Pooling and Servicing Agreement, as amended from time to time, the Certificateholder by virtue of its acceptance hereof assents and by which the Certificateholder is bound. This Certificate is one of a series of Certificates entitled "First Consumers Master Trust Collateral Certificates" (the "Collateral Certificates"), which represents an undivided interest in the Trust. Unless the certificate of authentication hereon has been executed by or on behalf of the Trustee, by manual or facsimile signature of a duly authorized signatory, this Certificate shall not be entitled to any benefit under the Pooling and Servicing Agreement or be valid for any purpose. IN WITNESS WHEREOF, the Trustee has caused this Collateral Certificate to be duly executed under its official seal. THE BANK OF NEW YORK, (successor-in-interest to the corporate trust administration of Harris Trust and Savings Bank), as Trustee By:____________________________________ Vice President Attested to: By:________________________ Assistant Secretary Date:______________________ -3- Trustee's Certificate of Authentication This is one of the Collateral Certificates referred to in the within- mentioned Pooling and Servicing Agreement. THE BANK OF NEW YORK, (successor-in-interest to the corporate trust administration of Harris Trust and Savings Bank), as Trustee By:_____________________________________ Authorized Officer EX-4.7 9 0009.txt NOTE PURCHASE AGREEMENT AS OF MARCH 1, 2001 Execution Copy Exhibit 4.7 ----------- - ------------------------------------------------------------------------------- CLASS C NOTE PURCHASE AGREEMENT Dated as of March 6, 2001 among FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, Issuer, FIRST CONSUMERS NATIONAL BANK, Seller and Servicer, THE CLASS C PURCHASERS PARTIES HERETO, and DEUTSCHE BANK AG, NEW YORK BRANCH, Administrative Agent -------------------- Relating to First Consumers Credit Card Master Note Trust Class C Series 2001-A Floating Rate Asset Backed Notes -------------------- - -------------------------------------------------------------------------------- CLASS C NOTE PURCHASE AGREEMENT, dated as of March 6, 2001, by and among FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST, an Illinois trust (together with its successors and assigns, the "Issuer"), FIRST CONSUMERS NATIONAL BANK, a ------ national banking association ("FCNB"), as Seller (as defined in the Indenture ---- referred to below) and as Servicer (as defined in the Indenture referred to below), the CLASS C PURCHASERS (as hereinafter defined) from time to time parties hereto, and DEUTSCHE BANK AG, a German banking corporation acting through its New York Branch ("DBNY"), as administrative agent for the Class C ---- Purchasers (together with its successors in such capacity, the "Administrative -------------- Agent"). - ----- W I T N E S S E T H: WHEREAS, the Issuer, the Seller, the Servicer and the Indenture Trustee (as defined below) are parties to a certain Transfer and Servicing Agreement, dated as of March 1, 2001 (as the same may from time to time be amended or otherwise modified, the "Transfer and Servicing Agreement"), pursuant to which, -------------------------------- among other things, the Seller has assigned, transferred and conveyed its right, title and interest in, to and under the Collateral Certificate (as defined therein) to the Issuer, and, upon termination of the First Consumers Master Trust, has agreed to assign, transfer and convey, its right, title and interest in, to and under certain Receivables (as defined therein) to the Issuer, and the Servicer has agreed to service such Receivables; WHEREAS, the Issuer and The Bank of New York, as trustee (together with its successors in such capacity, the "Indenture Trustee") are parties to a ----------------- certain Master Indenture, dated as of March 1, 2001 (as the same may from time to time be amended or otherwise modified, the "Master Indenture"); ---------------- WHEREAS, the Issuer proposes to issue its Class C Series 2001-A Floating Rate Asset Backed Notes (the "Class C Notes") pursuant to the Master ------------- Indenture, as supplemented by the Series 2001-A Indenture Supplement, dated as of March 1, 2001 (as the same may from time to time be amended or, otherwise modified, the "Supplemental Indenture" and the Master Indenture, as supplemented ---------------------- by the Supplemental Indenture, the "Indenture"); --------- WHEREAS, the Issuer also proposes to issue its Class A Series 2001-A Floating Rate Asset Backed Notes (the "Class A Notes") and its Class B Series ------------- 2001-A Floating Rate Asset Backed Notes (the "Class B Notes") pursuant to the ------------- Indenture, to which Class A Notes and Class B Notes the Class C Notes are subordinate; WHEREAS, the Issuer proposes to establish a cash collateral account (the "Spread Account") with the Indenture Trustee pursuant to the terms of the -------------- Supplemental Indenture for the benefit of the Class C Purchasers; WHEREAS, the Class C Purchasers are willing to purchase the Class C Notes in the amount of the Class C Initial Note Principal Balance on the Closing Date on the terms and conditions provided for herein; NOW THEREFORE, in consideration of the mutual covenants herein contained, and other good and valuable consideration, the receipt and adequacy of which are hereby expressly acknowledged, the parties hereto agree as follows: ARTICLE 1 DEFINITIONS 1.1 Definitions. All capitalized terms used herein as defined ----------- terms and not defined herein shall have the meanings given to them in the Indenture or the Related Documents. Each capitalized term defined herein shall relate only to the Series 2001-A and to no other Series issued pursuant to the Indenture. "Adjusted Eurodollar Rate" shall mean, for any Interest Accrual Period ------------------------ or portion thereof, a rate per annum (rounded upwards, if necessary, to the nearest 1/16th of 1%) equivalent to the rate determined pursuant to the following formula: Adjusted Eurodollar Rate = LIBOR --------------- 1-LIBOR Reserve Percentage on the first day of such Interest Accrual Period. "Adjusted Excess Spread" has the meaning specified in the definition of ---------------------- "Excess Spread Percentage" in this Section 1.1. "Administrative Agent" has the meaning specified in the preamble to -------------------- this Agreement. "Affected Party" shall mean, with respect to any CP Conduit, any -------------- Support Party of such CP Conduit. "Agreement" shall mean this Class C Note Purchase Agreement, as --------- amended, supplemented or otherwise modified from time to time. "Alternative Rate" shall mean, for any Interest Accrual Period, an ---------------- interest rate per annum equal to 0.75% per annum above the Adjusted Eurodollar Rate for such Interest Accrual Period. "Applicable Percentage" shall have the meaning specified in the --------------------- Supplemental Spread Account Letter. "Assignee" and "Assignment" have the respective meanings specified in -------- ---------- subsection 8.1(e) of this Agreement. "Cap Increase Event" shall mean: ------------------ (a) the occurrence of any Series 2001-A Pay Out Event or the occurrence of an event which would be a Series 2001-A Pay Out Event but for a waiver of or failure to declare or determine such event by the noteholders or the Trustee (unless waived by the Required Class C Owners); -2- (b) the failure of the Seller, the Servicer or the Trustee to make a deposit or withdrawal required hereunder when and as required and such failure continues for five Business Days (unless waived by the Required Class C Owners); (c) A Change of Control shall occur; (d) a breach of a representation or warranty hereunder which is not cured within 60 days (unless waived by the Required Class C Owners); (e) the failure by the Seller or the Servicer or, if such failure is reasonably expected to have a material adverse effect on the Class C Purchasers, by the Trustee, to duly observe or perform any term or provision of this Agreement (except as covered by clause (a) above) which is not cured or waived by the Required Class C Owners within 60 days after written notice of such failure is given to the defaulting party (with a copy to FCNB if FCNB in any capacity is not the defaulting party) by the Administrative Agent; (f) the Class A Notes or the Class B Notes are not repaid in full on the Class A Expected Principal Distribution Date or the Class B Expected Principal Distribution Date, respectively; (g) that the Class C Notes are not rated at least Baa2 by Moody's and BBB by Standard & Poor's or the ratings on the Class C Notes have been withdrawn by either Moody's or Standard & Poor's; (h) FCNB is not considered "well capitalized" with respect to ratios of total capital (and core capital) to risk-weighted-assets under applicable regulations of the Governmental Authorities regulating FCNB and such circumstance continues for a period of thirty consecutive days, provided that if such regulations no longer specify numeric -------- ratios which qualify a bank as "well capitalized", FCNB shall be deemed "well capitalized" if the ratio of its risk-based capital to risk-weighted assets exceeds 10%; or (i) the occurrence of the Series Termination Date. "Change of Control" means that: ----------------- (i) Spiegel shall fail to own, directly or indirectly, free and clear of all liens, security interests or other encumbrances, at least 51% of the outstanding shares of the capital stock of FCNB, on a fully diluted basis; or (ii) the Otto family related investment vehicles shall fail to own at least 67% of the outstanding shares of the capital stock of Spiegel. "Class A Notes" has the meaning specified in the recitals to this ------------- Agreement. "Class B Notes" has the meaning specified in the recitals to this ------------- Agreement. -3- "Class C Monthly Interest" shall mean, for any Monthly Period, the sum ------------------------ of (a) the interest on the Class C Note Principal Balance accrued for such Monthly Period computed pursuant to subsections 2.2(a) or 2.2(b), as applicable, of this Agreement and (b) all amounts (other than principal of the Class C Notes) due hereunder at such time. "Class C Note Asset Balance" shall mean, on any date, the product of -------------------------- (i) the Allocation Percentage (determined, for this purpose only, by using a numerator equal to the Class C Note Principal Balance in lieu of the Collateral Amount), and (ii) the sum of the Excess Funding Amount, the amount on deposit in the Collection Account in respect of Collections of Principal Receivables and the total amount of Principal Receivables on such date. "Class C Notes" has the meaning specified in the recitals to this ------------- Agreement. "Class C Owners" shall mean the Class C Purchasers that are owners of -------------- record of the Class C Notes or, with respect to any Class C Note held by the Administrative Agent hereunder as nominee on behalf of Class C Purchasers, the Class C Purchasers that are owners of the Class C Noteholders' Interest represented by such Class C Note as reflected on the books of the Administrative Agent in accordance with this Agreement and the Related Documents. "Class C Purchaser" shall mean any Person which is designated as a ----------------- Class C Purchaser on the signature pages hereto or in the Transfer Supplement pursuant to which it became a party to this Agreement. "Closing Date" shall mean March 6, 2001. ------------ "Code" shall mean the Internal Revenue Code of 1986, as amended. ---- "Commercial Paper Notes" shall mean, with respect to a CP Conduit, the ---------------------- short-term promissory notes issued by such CP Conduit which are allocated by such CP Conduit as its funding for its purchasing or maintaining its Percentage Interest of the Class C Note Principal Balance hereunder. "Commercial Paper Rate" shall mean, for each Tranche of the Class C --------------------- Note Principal Balance, for any day to the extent a CP Conduit funds its Percentage Interest of such Tranche on such day with outstanding Commercial Paper Notes, the sum of (a) the rate (or if more than one rate, the weighted average of the rates) per annum at which such Commercial Paper Notes were sold by any placement agent or commercial paper dealer selected by or on behalf of such CP Conduit, as agreed between each such agent or dealer and such CP Conduit; provided that if the rate (or rates) as agreed between any such agent -------- or dealer and such CP Conduit is a discount rate (or rates), then such rate shall be the rate (or if more than one rate, the weighted average of the rates) resulting from converting such discount rate (or rates) to an interest-bearing equivalent rate per annum, plus (b) 0.05% in respect of dealer fees and commissions (to the extent not included in the rate or rates described in clause (a)). "Commission" shall mean the Securities and Exchange Commission. ---------- -4- "Commitment" shall mean, for any Class C Purchaser, the maximum amount ---------- of such Class C Purchaser's commitment to purchase a portion of the Class C Noteholders' Interest, as set forth on the signature pages hereto, or, in the case of a Class C Purchaser which became a Class C Purchaser by Assignment, on Schedule II to such Class C Purchaser's Assignment opposite the heading "Class C Note Principal Balance Purchased", respectively, as the same may be reduced pursuant to any Assignment. "Consented Transferee Letter" shall mean the letter, dated as of the --------------------------- date of this Agreement and referring to this Agreement (or any replacement therefor from time to time in effect), from the Seller to, and accepted by, the Administrative Agent, as such letter may be amended or otherwise modified from time to time by the Administrative Agent with the consent of the Seller. "Covered Portion" shall mean a portion of the Class C Note Principal --------------- Balance equal to the Class C Note Asset Balance. "CP Conduit" shall mean any Class C Purchaser which is a commercial ---------- paper conduit or other special purpose funding vehicle sponsored by the Administrative Agent, or by any other bank or financial institution to which the Administrative Agent and FCNB shall have consented (which consents shall not be unreasonably withheld). "DBNY" has the meaning specified in the preamble to this Agreement. ---- "Excess Spread Percentage" shall mean, with respect to each Monthly ------------------------ Period, an amount equal to the percentage equivalent of a fraction, the numerator of which is the product of (x) an amount (for each Monthly Period, the - --------- "Adjusted Excess Spread") equal to (i) Investor Finance Charge Collections with ---------------------- respect to such Monthly Period, plus (ii) the amount of the Reserve Draw Amount ---- plus any amounts of interest and earnings described in Section 4.10 of the Supplemental Indenture deposited into the Collection Account on the Distribution Date relating to such Monthly Period, plus (iii) the amount of the Net Swap ---- Receipts for the Distribution Date relating to such Monthly Period minus (iv) ----- the portion of the Investor Finance Charge Collections consisting of (A) Discount Option Receivable Collections or (B) Shared Finance Charge Collections, minus (v) the distributions on the Distribution Date relating to such Monthly - ----- Period provided for in clauses (i) through (vi) of Section 4.4(a) of the Supplemental Indenture; and (y) twelve, and the denominator of which is the ----------- Collateral Amount on the first day of such Monthly Period. "Excluded Taxes" has the meaning specified in subsection 2.4(a) of this -------------- Agreement. "FCNB" has the meaning specified in the preamble to this Agreement. ---- "Governmental Authority" shall mean any nation or government, any state ---------------------- or other political subdivision thereof and any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government. "Indemnitee" has the meaning specified in subsection 2.5(a) of this ---------- Agreement. -5- "Indenture Trustee" has the meaning specified in the recitals to this ----------------- Agreement. "Interest Accrual Period" shall mean, (i) with respect to each Tranche ----------------------- of the Class C Note Principal Balance which bears interest calculated by reference to the Commercial Paper Rate, each period from the date of issuance to the maturity date of the related tranche of commercial paper notes used in determining the Commercial Paper Rate for such Tranche (or, if earlier, the date on which such Tranche ceases to bear interest calculated by reference to the Commercial Paper Rate), and (ii) with respect to any other Tranches of the Class C Note Principal Balance, each Monthly Period and the period commencing on the day following the end of the final Monthly Period for Series 2001-A and ending on the final Distribution Date for Series 2001-A. "Investing Office" shall mean initially, the office of any Class C ---------------- Purchaser (if any) designated as such, on the signature pages hereto or in the Transfer Supplement by which it became a party to this Agreement, and thereafter, such other office of such Class C Purchaser or such Assignee as may be designated in writing to the Administrative Agent, the Issuer, the Servicer and the Indenture Trustee by such Class C Purchaser or Assignee. "Investment Earnings" shall mean, with respect to any Distribution ------------------- Date, all interest and earnings on Permitted 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. "Investment Letter" has the meaning specified in subsection 8.1(a) of ----------------- this Agreement. "LIBOR" has the meaning specified in the Supplemental Indenture. ----- "LIBOR Reserve Percentage" shall mean, with respect to any Interest ------------------------ Accrual Period or portion thereof, a percentage (expressed as a decimal) equal to the weighted average of the percentages in effect during such Interest Accrual Period, as prescribed by the Board of Governors of the Federal Reserve System (or any successor thereto) for determining the maximum reserve requirements applicable to "Eurocurrency liabilities" pursuant to Regulation D or any other applicable regulation of the Federal Reserve Board (or any successor thereto) which prescribes reserve requirements applicable to "Eurocurrency liabilities" as currently defined in Regulation D. "Loan Spread Rate" shall mean, the applicable rate or rates identified ---------------- as the "Loan Spread Rate" in the Supplemental Fee Letter. "Maximum Release Amount" shall have the meaning specified in the ---------------------- Supplemental Spread Account Letter. "Note Rate Determination Date" shall mean, for any Monthly Period, the ---------------------------- third Business Day prior to the Distribution Date which follows the end of such Monthly Period. "Participant" has the meaning specified in subsection 8.1(d) of this ----------- Agreement. -6- "Participation" has the meaning specified in subsection 8.1(d) of the ------------- Agreement. "Percentage Interest" shall mean, for a Class C Purchaser on any day, ------------------- the percentage equivalent of (a) the sum of (i) the portion of the Class C Initial Note Principal Balance (if any) purchased by such Class C Purchaser, plus (ii) any portion of the Class C Note Principal Balance acquired by such - ---- Class C Purchaser as an Assignee from another Class C Purchaser pursuant to a Transfer Supplement executed and delivered pursuant to Section 8.1 of this Agreement, minus (iii) the aggregate amount of principal payments made to such ----- Class C Purchaser prior to such day, minus (iv) any portion of the Class C Note ----- Principal Balance assigned by such Class C Purchaser to an Assignee pursuant to a Transfer Supplement executed and delivered pursuant to Section 8.1 of this Agreement, divided by (b) the aggregate Class C Note Principal Balance on such ------- -- day. "Permitted Transferee" shall mean each initial Class C Purchaser, -------------------- Administrative Agent (in its individual capacity), each Person listed in the Consented Transferee Letter as in effect on the date on which such Person became or agreed to become a Class C Purchaser, a Participant or a Support Party, and each other Person who has been consented to as a potential Transferee by the Seller. "Person" shall mean an individual, partnership, corporation, business ------ trust, joint stock company, trust, unincorporated association, joint venture, governmental authority or other entity of whatever nature. "Prime Rate" shall mean, for any day, a fluctuating rate of interest ---------- per annum equal to the higher of: (i) the rate of interest most recently announced by Deutsche Bank AG as its prime lending rate for unsecured commercial loans within the United States, and (ii) 0.50% above the rate per annum at which Deutsche Bank AG, New York Branch, as a branch of a foreign bank, in its reasonable discretion, can acquire federal funds in the interbank overnight federal funds market, through brokers of recognized standing or otherwise, as most recently determined by Deutsche Bank AG, New York Branch. The Prime Rate is not necessarily intended to be the lowest rate of interest determined by Deutsche Bank AG or Deutsche Bank AG, New York Branch, in connection with extensions of credit. "Prospectus" shall mean the prospectus as first filed with the ---------- Commission under Rule 424(b) of the Act relating to the Series 2001-A Notes. "Registration Statement" shall mean the registration statement on Form ---------------------- S-3 of FCNB and First Consumers Master Trust (Registration Number 333-48860 and 333-48860-01) as amended from time to time and including incorporated documents and exhibits, filed with the Commission pursuant to the Act, relating to the Series 2001-A Notes. "Regulatory Change" shall mean, as to each Class C Purchaser, any ----------------- change occurring after the date of the execution and delivery of this Agreement or, if later, the date of the execution and delivery of the Transfer Supplement by which it became party to this Agreement; in the case of a Participant, any change occurring after the date on which its Participation became -7- effective, or in the case of an Affected Party, any change occurring after the date it became such an Affected Party, in any (or the adoption after such date of any new): (1) United States Federal or state law or foreign law applicable to such Class C Purchaser, Affected Party or Participant; or (2) regulation, interpretation, directive, guideline or request (whether or not having the force of law) applicable to such Class C Purchaser, Affected Party or Participant of any court or other judicial authority or any Governmental Authority charged with the interpretation or administration of any law referred to in clause (i) or of any fiscal, monetary or other Governmental Authority or central bank having jurisdiction over such Class C Purchaser, Affected Party or Participant. "Related Documents" shall mean, collectively, this Agreement (including ----------------- the Supplemental Fee Letter, the Supplemental Spread Account Letter and all effective Transfer Supplements), the Master Indenture, the Supplemental Indenture, the Transfer and Servicing Agreement, the Trust Agreement, the Series 2001-A Notes and the Transaction Documents. "Required Class C Owners" shall mean, at any time, Class C Owners ----------------------- having at least 51% of the aggregate Percentage Interests of all Class C Owners. "Requirement of Law" shall mean, as to any Person, any law, treaty, ------------------ rule or regulation, or determination of an arbitrator or Governmental Authority, in each case applicable to or binding upon such Person or to which such Person is subject, whether federal, state or local (including usury laws, the Federal Truth in Lending Act and Regulation Z and Regulation B of the Board of Governors of the Federal Reserve System). "Risk Portion" shall mean a portion of the Class C Note Principal ------------ Balance equal to the excess, if any, of Class C Note Principal Balance over the Class C Note Asset Balance. "Risk Rate" shall mean, for any day, a rate per annum equal to the --------- Prime Rate in effect for such day. "Spread Account Amount" shall mean, as of any date, an amount equal to --------------------- the amount on deposit in the Spread Account (exclusive of Investment Earnings) on such date, after giving effect to all deposits, transfers and withdrawals from the Spread Account on such date. "Spread Account Cap" with respect to any date of determination, shall ------------------ mean the result obtained by multiplying the Initial Collateral Amount by the Applicable Percentage in effect on such date; provided that the Spread Account ------------- Cap shall be increased to the Class C Note Principal Balance upon the occurrence of a Cap Increase Event; and provided, further that at no time shall the Spread ----------------- ---- Account Cap exceed an amount equal to the Class C Note Principal Balance. "Supplemental Indenture" has the meaning specified in the recitals to ---------------------- this Agreement. -8- "Supplemental Fee Letter" shall mean, the letter agreement, designated ----------------------- therein as a Supplemental Fee Letter, among the Issuer, FCNB and the Administrative Agent, as such letter agreement may be amended or otherwise modified from time to time. "Supplemental Spread Account Letter" shall mean that certain letter ---------------------------------- agreement designated as such, dated as of the date hereof, among the Issuer, FCNB and the Administrative Agent. "Support Advances" shall mean, with respect to a Liquidity Purchaser ---------------- and its related CP Conduit, any participation held by such Liquidity Purchaser in such CP Conduit's Percentage Interest in the Class C Note Principal Balance which was purchased from such CP Conduit pursuant to a Support Facility and any loans or other advances made by such Liquidity Purchaser to such CP Conduit pursuant to a Support Facility to fund such CP Conduit's making or maintaining its purchases hereunder (but excluding any such loans or advances made to fund such CP Conduit's obligations to pay interest, fees or other similar amounts relating to the funding of its making or maintaining its purchases hereunder). "Support Facility" shall mean any liquidity or credit support agreement ---------------- with a CP Conduit which relates to this Agreement (including any agreement to purchase an assignment of or participation in Class C Notes). "Support Party" shall mean any other bank, insurance company or other ------------- financial institution extending or having a commitment to extend funds to or for the account of a CP Conduit (including by agreement to purchase an assignment of or participation in Class C Notes) under a Support Facility. "Taxes" has the meaning specified in subsection 2.4(a) of this ----- Agreement. "Termination Date" shall mean the Series Termination Date, provided ---------------- -------- that if the Rapid Amortization Period has been continued as set forth in the definition thereof in the Supplemental Indenture because amounts are owed to the Class C Purchasers, then the Termination Date shall be the last day of the Rapid Amortization Period, as so continued. "Three Month Average Excess Spread Percentage" means, with respect to -------------------------------------------- any Monthly Period, the average of the Excess Spread Percentages for such Monthly Period and the two preceding Monthly Periods, provided that the Three -------- Month Average Excess Spread Percentage for the first Monthly Period shall equal the Excess Spread Percentage for such Monthly Period and the Three Month Average Excess Spread Percentage for the second Monthly Period shall equal the Two Month Average Excess Spread Percentage for such Monthly Period. "Tranche" shall mean (i) in the case of the portion of the Class C Note ------- Principal Balance which bears interest by reference to the Commercial Paper Rate, each portion thereof which the applicable CP Conduit determines is funded or maintained with its commercial paper notes having the same maturity date and yield or by a single commercial paper note having a maturity date or yield which differs from any other commercial paper notes allocated by such CP Conduit -9- to its funding or maintaining of such portion of the Class C Note Principal Balance, and (ii) in the case of the remaining portion of the Class C Note Principal Balance, such entire remaining portion. "Transfer" has the meaning specified in subsection 8.1(c) of this -------- Agreement. "Transfer and Servicing Agreement" has the meaning specified in the -------------------------------- recitals to this Agreement. "Transfer Supplement" has the meaning specified in subsection 8.1(e) of ------------------- this Agreement. "Transferee" has the meaning specified in subsection 8.1(c) of this ---------- Agreement. "Trust" has the meaning specified in the recitals to this Agreement. ----- "Two Month Average Excess Spread Percentage" means, with respect to any ------------------------------------------ Monthly Period, the average of the Excess Spread Percentages for such Monthly Period and the preceding Monthly Period, provided that the Two Month Average -------- Excess Spread Percentage for the first Monthly Period shall equal the Excess Spread Percentage for such Monthly Period. "written" or "in writing" (and other variations thereof) shall mean any ------- ------- form of written communication or a communication by means of telex, telecopier device, telegraph or cable. 1.2 Other Definitional Provisions. ----------------------------- (a) Unless otherwise specified therein, all terms defined in this Agreement shall have the defined meanings when used in any certificate or other document made or delivered pursuant hereto. (b) The words "hereof", "herein", and "hereunder" and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement; and Section, subsection and Exhibit references are to this Agreement, unless otherwise specified. The words "including" and "include" shall be deemed to be followed by the words "without limitation". ARTICLE 2 AMOUNT AND TERMS OF COMMITMENTS 2.1 Purchase. -------- (a) On and subject to the terms and conditions of this Agreement, the Class C Purchaser agrees to purchase the Class C Initial Note Principal Balance for a purchase price equal to the Class C Initial Note Principal Balance. (b) The purchase of the Class C Initial Note Principal Balance hereunder shall be made on the Closing Date. -10- (c) The Class C Purchaser's purchase price payable pursuant to subsection 2.1(a) of this Agreement shall be made available to the Administrative Agent, subject to the fulfillment of the applicable conditions set forth in Article 3 hereof, at or prior to 10:00 a.m., New York City time, on the Closing Date, by deposit of immediately available funds to an account of the Administrative Agent specified in subsection 9.2(b) of this Agreement. Subject to (i) the Administrative Agent's receipt of such funds and (ii) the fulfillment of the applicable conditions set forth in Article 3 hereof, as determined by the Administrative Agent, the Administrative Agent will not later than 12:00 p.m., New York City time, on the Closing Date make such funds available, in the same type of funds received, by wire transfer thereof to the account of Issuer or as the Issuer may otherwise direct in the United States specified in writing by the Issuer to the Administrative Agent not later than the Business Day prior to the Closing Date. 2.2 Interest, Fees, Expenses, Payments, Etc. --------------------------------------- (a) Except as otherwise provided in subsection 2.2(b) of this Agreement, each Tranche of each CP Conduit's Percentage Interest of the Covered Portion of the Class C Note Principal Balance shall bear interest for each Interest Accrual Period at a rate per annum equal to the sum of such CP Conduit's Commercial Paper Rate applicable to such Tranche plus the Loan Spread Rate. Each CP Conduit's commercial paper tranches will be selected by such CP Conduit or its administrator, after consultation with the Seller, to the extent reasonably practicable. Each other Class C Purchaser's (other than a CP Conduit's) Percentage Interest of the Covered Portion of the Class C Note Principal Balance shall bear interest for each Interest Accrual Period at a rate per annum equal to the sum of the Alternative Rate plus the Loan Spread Rate. Each Class C Purchaser's Percentage Interest of the Risk Portion of the Class C Note Principal Balance shall bear interest for each Interest Accrual Period at a rate per annum equal to the sum of the Risk Rate from time to time in effect plus the Loan Spread Rate. (b) If and to the extent that, and only for so long as, a CP Conduit at any time determines in good faith that it is unable to raise or is precluded or prohibited from raising, or that it is not advisable to raise, funds through the issuance of Commercial Paper Notes in the commercial paper market of the United States to finance its purchase or maintenance of its Percentage Interest of the Covered Portion of the Class C Note Principal Balance or any portion thereof (which determination may be based on any allocation method employed in good faith by such CP Conduit), including by reason of market conditions or by reason of insufficient availability under any of its Support Facilities or the downgrading of any of its Support Parties, upon notice from such CP Conduit to the Administrative Agent and the Issuer, such portion of such CP Conduit's Percentage Interest of the Class C Note Principal Balance shall bear interest at a rate per annum equal to the sum of the Alternative Rate plus the Loan Spread Rate, rather than as otherwise determined pursuant to subsection 2.2(a) of this Agreement. (c) The principal of the Class C Notes shall be paid as provided in the Indenture. Accrued and unpaid interest on each Tranche of the Class C Note Principal Balance shall be due and payable on the last day of each Interest Accrual Period applicable to such Tranche and on any date on which the principal of such Tranche is paid or required to be paid -11- hereunder or under the Indenture (in respect of the portion of principal paid or required to be paid). Class C Monthly Interest for each Monthly Period (including the last Monthly Period), except to the extent otherwise provided in the definition of Class C Monthly Period contained in Section 1.1, shall be due and payable on the Distribution Date for such Monthly Period. In the case of Class C Notes held by the Administrative Agent, the Administrative Agent shall allocate to the Class C Owners each payment in respect of the Class C Notes received by the Administrative Agent in its capacity as Class C Noteholder as provided herein. Payments in reduction of the portion of the Class C Note Principal Balance evidenced by a Class C Note shall be allocated and applied to Class C Owners of such Class C Note pro rata based on their respective Percentage Interests of the Class C Note Principal Balance, or in any such case in such other proportions as each affected Class C Purchaser may agree upon in writing from time to time with the Administrative Agent and the Issuer. Payments of interest in respect of the portion of the Class C Note Principal Balance evidenced by a Class C Note shall be allocated and applied to Class C Owners of such Class C Note pro rata based upon the respective amounts of interest due and payable to them, determined as provided above in this Section 2.2. (d) The Seller on behalf of the Issuer agrees to pay to the Administrative Agent the amounts set forth in Section 1 of the Supplemental Fee Letter at the times specified therein. (e) The Seller on behalf of the Issuer agrees to pay on demand (i) to the Administrative Agent and the initial Class C Purchaser all reasonable costs and expenses in connection with the preparation, execution, and delivery of this Agreement and the other documents to be delivered hereunder or in connection herewith, including the reasonable fees and out-of-pocket expenses of counsel with respect thereto and the amounts due to Moody's and S&P in connection with their review of the initial Class C Purchaser's acquisition of the Class C Notes, provided that such fees of counsel shall not exceed the -------- amounts set forth in the Supplemental Fee Letter, (ii) to the Administrative Agent and each Class C Purchaser, all reasonable costs and expenses in connection with the any requested amendments of or waivers or consents under this Agreement or the Related Documents, including in each case the reasonable fees and out-of-pocket expenses of counsel with respect thereto, and (iii) if an Event of Default or Servicer Default shall have occurred, to the Administrative Agent and each Class C Purchaser, on demand, all reasonable costs and expenses (including reasonable fees and expenses of counsel), if any, in connection with the enforcement of this Agreement or any of the Related Documents, and the other documents delivered thereunder or in connection therewith. (f) The Seller on behalf of the Issuer agrees to pay on demand any and all stamp, transfer and other similar taxes (other than Taxes covered by Section 2.4 hereof) and governmental fees payable in connection with the execution, delivery, filing and recording of any of the Related Documents and each related Support Facility, and agrees to save each Class C Purchaser and the Administrative Agent harmless from and against any liabilities with respect to or resulting from any delay in paying or any omission to pay such taxes and fees. (g) Any interest, fees or other amounts due and payable hereunder (without regard to any limitations set forth herein on the sources from which such amount may be paid) -12- which are not paid on the due date thereof (including interest payable pursuant to this clause (g)) shall accrue interest (after as well as before judgment) at a rate per annum equal to the sum of the Risk Rate from time to time in effect plus the Loan Spread Rate plus 2.0% from and including the due date thereof to but excluding the date such amount is actually paid. (h) Unless otherwise specified in the Supplemental Fee Letter, interest calculated by reference to the Commercial Paper Rate or the Adjusted Eurodollar Rate shall be calculated on the basis of a 360-day year for the actual days elapsed. Interest calculated by reference to the Prime Rate shall be calculated on the basis of a 365- or 366-day year, as applicable, for the actual days elapsed. Periodic fees or other periodic amounts payable hereunder shall be calculated, unless otherwise specified in the Supplemental Fee Letter, on the basis of a 360-day year and for the actual days elapsed. (i) All payments to be made hereunder or under the Indenture, whether on account of principal, interest, fees or otherwise, shall be made without setoff or counterclaim and shall be made prior to 2:30 p.m., New York City time, on the due date thereof to the Administrative Agent at its account specified in subsection 9.2(b) hereof, in United States dollars and in immediately available funds. Payments received by the Administrative Agent after 2:30 p.m., New York City time, shall be deemed to have been made on the next Business Day. Notwithstanding anything herein to the contrary, if any payment due hereunder becomes due and payable on a day other than a Business Day, the payment date thereof shall be extended to the next succeeding Business Day and interest shall accrue thereon at the applicable rate during such extension. To the extent that (i) the Issuer, the Indenture Trustee, the Seller or the Servicer makes a payment to the Administrative Agent or a Class C Purchaser or (ii) the Administrative Agent or a Class C Purchaser receives or is deemed to have received any payment or proceeds for application to an obligation, which payment or proceeds or any part thereof are subsequently invalidated, declared to be fraudulent or preferential, set aside or required to be repaid to a trustee, receiver or any other party under any bankruptcy or insolvency law, state or Federal law, common law, or for equitable cause, then, to the extent such payment or proceeds are set aside, the obligation or part thereof intended to be satisfied shall be revived and continue in full force and effect, as if such payment or proceeds had not been received or deemed received by the Administrative Agent or Class C Purchaser, as the case may be. (j) At or before 4:00 p.m., New York City time, on each Note Rate Determination Date and on the third Business Day preceding the end of each Interest Accrual Period, each CP Conduit shall notify the Administrative Agent of (i) its Commercial Paper Rate, if applicable, for each Tranche in effect for the related Monthly Period or Interest Accrual Period, as applicable, and (ii) if applicable, the date on which the Alternative Rate became applicable to its Percentage Interest of the Class C Note Principal Balance or a portion thereof pursuant to subsection 2.2(b) of this Agreement. Such notification may be based on such CP Conduit's good faith estimate of the Commercial Paper Rate if the actual rate is not then known to such CP Conduit, and in such case, such CP Conduit shall notify the Administrative Agent at or before 4:00 p.m., New York City time, on the following Note Rate Determination Date of the amount of any variation between interest payable to such CP Conduit for the preceding Monthly Period or Interest Accrual Period, as applicable, based on such estimate and interest which -13- should have been payable to such CP Conduit for such Monthly Period or Interest Accrual Period, as applicable, based on its final determination of the applicable Commercial Paper Rate. The amount of any shortfall in interest based on such variation shall be included in the portion of Class C Monthly Interest payable to such CP Conduit on the following Distribution Date, and the amount of any overpayment of interest to such CP Conduit based on such variation shall be credited, dollar for dollar, against the portion of Class C Monthly Interest otherwise payable to such CP Conduit for the following Monthly Period. Each determination by a CP Conduit of its applicable Commercial Paper Rate pursuant to this Agreement shall be conclusive and binding on the Class C Purchasers, the Administrative Agent, the Issuer, the Seller, the Servicer and the Indenture Trustee in the absence of manifest error. (k) On each Note Rate Determination Date, (i) the Administrative Agent shall notify the Servicer, with respect to each CP Conduit, of the applicable Commercial Paper Rates for the related Monthly Period, and, if applicable, the dates on which the Alternative Rate was applicable to the Percentage Interest of the Class C Note Principal Balance owed to any Class C Purchaser, and (ii) the Administrative Agent shall notify the Servicer of the Alternative Rate and the Risk Rate, if applicable, for the related Monthly Period. For such purposes, the Administrative Agent may rely conclusively on notices from CP Conduits as to the interest rate or rates from time to time applicable to their respective Percentage Interest of the Class C Note Principal Balance. Such notification from the Administrative Agent may be based on such CP Conduit's good faith estimate of the Commercial Paper Rate as provided to the Administrative Agent pursuant to subsection 2.2(j) hereof, if the actual rate and amount is not then known to the Administrative Agent. In any such case, the Administrative Agent shall notify the Servicer and the Indenture Trustee on or before the next succeeding Note Rate Determination Date of the amount of any variation between the estimated amount of interest payable on Class C Notes accrued at the Commercial Paper Rate and the actual amount thereof for the preceding Monthly Period. The amount of any shortfall in interest based on such variation shall be a positive "Estimated Interest Adjustment" for such Monthly ----------------------------- Period, and the amount of any overpayment of interest based on such variation shall be a negative "Estimated Interest Adjustment" for such Monthly Period. Any ----------------------------- positive Estimated Interest Adjustment for a Monthly Period shall be deemed not due on the Distribution Date for such Monthly Period, but shall be due on the next succeeding Distribution Date. An Estimated Interest Adjustment shall not bear interest, unless not paid when due as provided in the preceding sentence. Each determination of the Commercial Paper Rate, the Alternative Rate and the Risk Rate by the Administrative Agent pursuant to any provision of this Agreement shall be conclusive and binding on the Class C Purchasers, the Issuer, the Servicer and the Indenture Trustee in the absence of manifest error. 2.3 Requirements of Law. ------------------- (a) In the event that any Class C Purchaser shall have reasonably determined that any Regulatory Change shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisition of funds by, such Class C Purchaser and the result of any of the foregoing is to increase the cost to such Class C Purchaser, by an amount which such Class C Purchaser deems to be material, of -14- maintaining its Commitment or its interest in the Class C Notes or to reduce any amount receivable in respect thereof, then, in any such case, after submission ---- by such Class C Purchaser to the Administrative Agent of a written request therefor and the submission by the Administrative Agent to the Issuer and the Servicer of such written request therefor, the Issuer shall pay to the Administrative Agent for the account of such Class C Purchaser any additional amounts necessary to compensate such Class C Purchaser for such increased cost or reduced amount receivable, to the extent not already reflected in the applicable interest rate, together with interest on any such unpaid amount from the Distribution Date following receipt by the Issuer of such request for compensation under this subsection 2.3(a) of this Agreement, if such request is received by the Issuer at least five Business Days prior to the Determination Date related to such Distribution Date, and otherwise from the following Distribution Date, until payment in full thereof (after as well as before judgment) at the Prime Rate in effect from time to time. (b) In the event that any Class C Purchaser shall have reasonably determined that any Regulatory Change regarding capital adequacy has the effect of reducing the rate of return on such Class C Purchaser's capital or on the capital of any Person controlling such Class C Purchaser as a consequence of its obligations hereunder or its maintenance of its Commitment or its interest in the Class C Notes to a level below that which such Class C Purchaser or such Person could have achieved but for such Regulatory Change (taking into consideration such Class C Purchaser's or such Person's policies with respect to capital adequacy) by an amount deemed by such Class C Purchaser or such Person to be material, then, from time to time, after submission by such Class C ---- Purchaser to the Administrative Agent of a written request therefor and submission by the Administrative Agent to the Issuer and the Servicer of such written request therefor, the Issuer shall pay to the Administrative Agent for the account of such Class C Purchaser such additional amount or amounts as will compensate such Class C Purchaser or such Person, as applicable, for such reduction, together with interest on any such unpaid amount from the Distribution Date following receipt by the Issuer of such request for compensation under this subsection 2.3(b), if such request is received by the Issuer at least five Business Days prior to the Determination Date related to such Distribution Date, and otherwise from the following Distribution Date, until payment in full thereof (after as well as before judgment) at the Prime Rate in effect from time to time. Nothing in this subsection 2.3(b) shall be deemed to require the Issuer to pay any amount to a Class C Purchaser to the extent such Class C Purchaser has been compensated therefor under another provision of this Agreement or to the extent such amount is already reflected in the applicable interest rate. (c) Each Class C Purchaser agrees that it shall use its reasonable efforts to mitigate, reduce or eliminate any claim for compensation pursuant to subsections 2.3(a) and 2.3(b) of this Agreement, including but not limited to designating a different Investing Office for its Class C Notes (or any interest therein) if such designation will avoid the need for, or reduce the amount of, any increased amounts referred to in subsection 2.3(a) or 2.3(b) hereof and will not, in the reasonable opinion of such Class C Purchaser, be unlawful or otherwise disadvantageous to such Class C Purchaser or inconsistent with its policies or result in any unreimbursed cost or expense to such Class C Purchaser or in an increase in the aggregate amount payable under subsections 2.3(a) and 2.3(b) hereof. -15- (d) Each Class C Purchaser claiming increased amounts described in subsection 2.3(a) or 2.3(b) of this Agreement will furnish to the Administrative Agent (together with its request for compensation) a certificate prepared in good faith setting forth the basis and the calculation of the amount (in reasonable detail) of each request by such Class C Purchaser for any such increased amounts referred to in subsection 2.3(a) or 2.3(b) hereof. Any such certificate shall be conclusive absent manifest error, and the Administrative Agent shall deliver a copy thereof to the Issuer and the Servicer. Failure on the part of any Class C Purchaser to demand compensation for any amount pursuant to subsection 2.3(a) or 2.3(b) hereof with respect to any period shall not constitute a waiver of such Class C Purchaser's right to demand compensation with respect to such period. (e) If (i) the Issuer becomes obligated to pay additional amounts to any Class C Purchaser pursuant to Section 2.3(a) or, (ii) any Class C Purchaser gives notice of the occurrence of any circumstances described in Section 2.3(b) that continues for more than 90 days, or (iii) any Class C Purchaser refuses to consent to any amendment, waiver or other action requested by Issuer, then, in each case Issuer may designate a bank which is acceptable to the Administrative Agent in its reasonable discretion (such other bank, a "Replacement Bank") to purchase the related Class C Note, without recourse to or ---------------- warranty by, or expense to, the affected Class C Purchaser for a purchase price equal to the outstanding principal amount of the Class C Notes held by the related Class C Note Purchaser plus any accrued but unpaid interest on such Class C Notes and all accrued but unpaid fees owed to the affected Class C Purchaser and any other amounts payable to the affected Class C Purchaser hereunder, and, upon such purchase, such Class C Purchaser shall no longer be party hereto or have any rights hereunder (other than indemnities and other similar rights applicable to such Class C Purchaser prior to the date of such assignment and assumption) and shall be relieved from all obligations to the Issuer hereunder, and the Replacement Bank shall succeed to the rights and obligations of such Class C Purchaser hereunder. 2.4 Taxes. ----- (a) All payments made to the Class C Purchasers or the Administrative Agent under this Agreement and the Indenture (including all amounts payable with respect to the Class C Notes) shall, to the extent allowed by law, be made free and clear of, and without deduction or withholding for or on account of, any present or future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any Governmental Authority (collectively, "Taxes"), excluding (i) income taxes (including branch profit ----- taxes, minimum taxes and taxes computed under alternative methods, at least one of which is based on or measured by net income), franchise taxes (imposed in lieu of income taxes), or any other taxes based on or measured by the net income of such Class C Purchaser, Participant or the Administrative Agent (as the case may be) or the gross receipts or income of such Class C Purchaser, Participant or the Administrative Agent (as the case may be); (ii) any Taxes that would not have been imposed but for the failure of such Class C Purchaser, Participant or the Administrative Agent, as applicable, to provide and keep current (to the extent legally able) any certification or other documentation required to qualify for an exemption from, or reduced rate of, any such Taxes or required by this Agreement -16- to be furnished by such Class C Purchaser, Participant or the Administrative Agent, as applicable; and (iii) any Taxes imposed as a result of a change by any Class C Purchaser or Participant of its Investing Office (other than changes mandated by this Agreement, including subsection 2.3(c) hereof, or required by law) (all such excluded taxes being hereinafter called "Excluded -------- Taxes"). If, as a result of any change in law, treaty or regulation or in the - ----- interpretation or administration thereof by any governmental or regulatory agency or body charged with the administration or interpretation thereof, or the adoption of any law, treaty or regulation, any Taxes, other than Excluded Taxes, are required to be withheld from any amounts payable to a Class C Purchaser or the Administrative Agent hereunder or under the Indenture, then after submission ---- by any Class C Purchaser to the Administrative Agent (in the case of an amount payable to a Class C Purchaser) and by the Administrative Agent to the Issuer and the Servicer of a written request therefor, the amounts so payable to such Class C Purchaser or the Administrative Agent, as applicable, shall be increased by the Issuer, and the Issuer shall pay to the Administrative Agent for the account of such Class C Purchaser or for its own account or to the Administrative Agent, as applicable, the amount of such increase to the extent necessary to yield to such Class C Purchaser or Agent or the Administrative Agent, as applicable (after payment of all such Taxes) interest or any such other amounts payable hereunder or thereunder at the rates or in the amounts specified in this Agreement and the Indenture; provided, however, that the -------- ------- amounts so payable to such Class C Purchaser or the Administrative Agent shall not be increased pursuant to this subsection 2.4(a) if such requirement to withhold results from the failure of such Person to comply with subsection 2.4(c) hereof. Whenever any Taxes are payable on or with respect to amounts distributed to a Class C Purchaser or the Administrative Agent, as promptly as possible thereafter the Servicer shall send to such Class C Purchaser or the Administrative Agent a certified copy of an original official receipt showing payment thereof. If the Issuer fails to pay any Taxes when due to the appropriate taxing authority or fails to remit to such Class C Purchaser or the Administrative Agent the required receipts or other required documentary evidence, the Issuer shall pay to the Administrative Agent on behalf of such Class C Purchaser or the Administrative Agent for its own account, as applicable, any incremental taxes, interest or penalties that may become payable by such Class C Purchaser or the Administrative Agent, as applicable, as a result of any such failure. (b) A Class C Purchaser claiming increased amounts under subsection 2.4(a) hereof for Taxes paid or payable by such Class C Purchaser will furnish to the Administrative Agent a certificate prepared in good faith setting forth the basis and amount of each request by such Class C Purchaser for such Taxes, and the Administrative Agent shall deliver a copy thereof to the Issuer and the Servicer. The Administrative Agent claiming increased amounts under subsection 2.4(a) hereof for its own account for Taxes paid or payable by the Administrative Agent, will furnish to the Issuer and the Servicer a certificate prepared in good faith setting forth the basis and amount of each request by the Administrative Agent for such Taxes. Any such certificate of a Class C Purchaser or the Administrative Agent shall be conclusive absent manifest error. Failure on the part of any Class C Purchaser or the Administrative Agent to demand additional amounts pursuant to subsection 2.4(a) of this Agreement with respect to any period shall not constitute a waiver of the right of such Class C Purchaser or the Administrative Agent, as the case may be, to demand compensation with respect to such period. All such amounts shall be due and payable to the Administrative Agent on behalf of such Class C -17- Purchaser or the Administrative Agent for its own account, as the case may be, on the Distribution Date following receipt by the Issuer of such certificate, if such certificate is received by the Issuer at least five Business Days prior to the Determination Date related to such Distribution Date and otherwise shall be due and payable on the following Distribution Date (or, if earlier, on the Series Termination Date). (c) Each Class C Purchaser and each Participant holding an interest in Class C Notes agrees that prior to the date on which the first interest or fee payment hereunder is due thereto, it will deliver to the Issuer, the Seller, the Servicer, the Indenture Trustee and the Administrative Agent (i) if such Class C Purchaser or Participant is not incorporated under the laws of the United States or any State thereof, two duly completed copies of the U.S. Internal Revenue Service Form W-8ECI or Form W-8BEN claiming treaty benefits, or in either case successor applicable forms required to evidence that the Class C Purchaser or Participant is entitled to receive payments under this Agreement and with respect to the Class C Notes without deduction or withholding of any United States federal income taxes, (ii) a duly completed U.S. Internal Revenue Service Form W-9 or successor applicable or required forms, and (iii) such other forms and information as may be required to confirm the availability of any applicable exemption from United States federal, state or local withholding taxes. Each Class C Purchaser or Participant holding an interest in Class C Notes also agrees to deliver to the Issuer, the Seller, the Servicer, the Indenture Trustee and the Administrative Agent two further copies of such Form W-8ECI or Form W-8BEN and Form W-9, or such successor applicable forms or other manner of certification, as the case may be, on or before the date that any such form expires or becomes obsolete or after the occurrence of any event requiring a change in the most recent form previously delivered by it hereunder, and such extensions or renewals thereof as may reasonably be requested by the Servicer, the Seller or the Administrative Agent, unless in any such case, solely as a result of a change in treaty, law or regulation occurring prior to the date on which any such delivery would otherwise be required, the Class C Purchaser is no longer eligible to deliver the then-applicable form set forth above and so advises the Servicer, the Seller and the Administrative Agent. Each Class C Purchaser certifies, represents and warrants as of the Closing Date, each Assignee and each Participant (in either case other than a Support Party) shall certify, represent and warrant as a condition of acquiring its Assignment or Participation as of the effective date of the Transfer Supplement to which it is a party or of such Participation, as the case may be, and each Support Party shall certify, represent and warrant as of the effective date of its becoming a Support Party, that (x) it is entitled to receive payments under this Agreement and with respect to the Class C Notes without deduction or withholding of any United States federal income taxes and (y) it is entitled to an exemption from United States backup withholding tax. Notwithstanding anything to the contrary herein, each of the Issuer, the Servicer and the Trustee shall be entitled to withhold any amount that it reasonably determines is required to be withheld pursuant to Section 1446 of the Code, and such amount shall be deemed to have been paid to the Class C Purchaser, Assignee or Participant for all purposes of the Agreement. 2.5 Indemnification. --------------- -18- (a) The Seller agrees to indemnify and hold harmless the Administrative Agent and each Class C Purchaser and any director, officer, employee or agent thereof (each such Person being an "Indemnitee") from and ---------- against any and all claims, damages, losses, liabilities, costs or expenses (including reasonable fees and out-of-pocket expenses of counsel) whatsoever (including claims under federal or state securities laws), which the Indemnitee may incur (or which may be claimed against the Indemnitee) by reason of or in connection with (i) the execution and delivery of this Agreement or any Related Document or the Class C Notes or the assignment hereof to any Support Party, (ii) the offer and sale by or on behalf of the Issuer, the Seller or any of their affiliates of the Series 2001-A Notes or (iii) the other transactions contemplated hereby, except (A) to the extent that any such claim, damage, loss, liability, cost or expense shall be caused by the willful misconduct or gross negligence of the Indemnitee, (B) to the extent that any such claim, damage, loss, liability, cost or expense relates to Taxes or amounts payable by the Issuer under Section 2.3 or 2.4 hereof, (C) for recourse for the payment of principal of or interest on, or other amounts due in respect of, the Class C Notes as a result of nonpayment by Obligors on the Accounts or the related Receivables or (D) is attributable to market fluctuations or other similar market or investment risk associated with ownership of the Class C Notes. The foregoing indemnity shall include indemnification for any claims, damages, losses, liabilities, costs or expenses (including fees and expenses of counsel) to which the Indemnitee may become subject under the Act, the Securities Exchange Act of 1934, as amended, the Investment Company Act of 1940, as amended, or any other Federal or state law or regulation (including Federal banking laws and regulations) arising out of or based upon any untrue statement or alleged untrue statement of a material fact in the Registration Statement at the time it became effective or the Prospectus or any amendments thereof or supplements thereto or arising out of or based upon the omission or the alleged omission to state a material fact necessary to make the statements in the Registration Statement at the time it became effective or the Prospectus or any amendment thereof or supplement thereto, in light of the circumstances in which they were made, not misleading. Subject to the limitations set forth above, but without limiting the generality of the foregoing, the Seller agrees to indemnify and hold harmless the Administrative Agent from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever which may at any time (including at any time following the payment of the obligations under this Agreement, including payment of the Class C Note Principal Balance) be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of this Agreement, or any documents contemplated by or referred to herein or the transactions contemplated hereby or any action taken or omitted by the Administrative Agent under or in connection with any of the foregoing; provided that the Seller shall not be liable under this sentence for -------- the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of the Administrative Agent resulting from its own gross negligence or willful misconduct. Promptly after receipt by the Administrative Agent or a Class C Purchaser of notice of the commencement of any action, the Administrative Agent or Class C Purchaser, as the case may be, will, if a claim in respect thereof is to be made under this subsection 2.5(a), notify the Seller in writing of the commencement thereof; provided, however, the omission to so notify the Seller -------- ------- will not relieve the Seller from any liability which it may have to the Administrative Agent or Class C Purchaser -19- under this subsection 2.5(a) except to the extent the Seller was actually prejudiced by the failure to give such notices promptly. (b) FCNB and any Successor Servicer, by accepting its appointment pursuant to the Transfer and Servicing Agreement, (i) shall agree to be bound by the terms, covenants and conditions contained herein applicable to the Servicer and to be subject to the duties and obligations of the Servicer hereunder, (ii) as of the date of its acceptance, shall be deemed to have made with respect to itself only the representations and warranties made by the Servicer in subsections 4.1(a) through 4.1(e) hereof (in the case of subsection 4.1(a) with appropriate factual changes) and (iii) shall agree to indemnify and hold harmless any Indemnitee from and against any and all claims, damages, losses, liabilities, costs or expenses (including the fees and expenses of counsel) whatsoever which such Indemnitee may incur (or which may be claimed against such Indemnitee) by reason of the negligence or willful misconduct of such Servicer in exercising its powers and carrying out its obligations under this Agreement, the Transfer and Servicing Agreement or any Related Document. (c) In the event that for any reason, (i) the basis for calculation of interest on any CP Conduit's Percentage Interest of the Class C Note Principal Balance shall change from the Commercial Paper Rate to the Alternative Rate, (ii) any CP Conduit receives any repayment of its share of the Class C Note Principal Balance, and the date of such change or of such repayment is not the maturity date for all Commercial Paper Notes allocated by such CP Conduit to funding its purchase or maintenance of the affected portion of its Percentage Interest of the Class C Note Principal Balance, or (iii) any Class C Purchaser receives any repayment of its share of the Class C Note Principal Balance on a date other than a Distribution Date or upon fewer than two Business Days' prior (or, with respect to amounts listed at the Alternative Rate based on the Adjusted Eurodollar Rate, two Business Days') written notice, then in any ---- such case the Issuer agrees to indemnify each affected Class C Purchaser against, and to promptly pay on demand directly to such Class C Purchaser the amount equal to any loss or reasonable out-of-pocket expense suffered by such Class C Purchaser as a result of such change or such repayment, including, in the case of a CP Conduit, any actual loss, cost or expense suffered by such CP Conduit by reason of its issuance of Commercial Paper Notes or its incurrence of other obligations reasonably allocated by such CP Conduit to its funding or the maintenance of its funding of its share of the Class C Note Principal Balance, or, in the case of any Class C Purchaser, redeploying funds prepaid or repaid, in amounts which correspond to its share of the Class C Note Principal Balance. A statement setting forth in reasonable detail the calculations of any additional amounts payable pursuant to this Section submitted by a Class C Purchaser or Agent or by the Administrative Agent, as the case may be, to the Issuer and the Servicer and shall be conclusive absent manifest error. ARTICLE 3 CONDITIONS PRECEDENT 3.1 Conditions to Initial Purchase. The following shall be ------------------------------ conditions precedent to the purchase of the Class C Notes by the Class C Purchasers: -20- (a) the representations and warranties of the Issuer and FCNB set forth or referred to in Sections 4.1 and 4.2, respectively, hereof shall be true and correct in all material respects on the Closing Date as though made on and as of the Closing Date, and no event which of itself or with the giving of notice or lapse of time, or both, would constitute a Series 2001-A Pay Out Event shall have occurred and be continuing on the Closing Date; (b) the Supplemental Fee Letter and the Supplemental Spread Account Letter shall have been executed and delivered by the Issuer and FCNB to the Administrative Agent; (c) the Class A Notes in the Class A Initial Note Principal Balance and the Class B Notes in the Class B Initial Note Principal Balance shall have been duly issued in accordance with the Indenture; the Spread Account shall have been established with the Indenture Trustee, and the amount on deposit in the Spread Account shall equal at least the Spread Account Cap; (d) the Seller shall have paid all fees payable on the Closing Date to the Administrative Agent (for its own account or for the account of the initial Class C Purchasers) described in the Supplemental Fee Letter and all reasonable and appropriately invoiced costs and expenses of the Administrative Agent and Class C Purchasers payable by the Seller, to the extent provided herein, in connection with the transactions contemplated hereby; and (e) the Administrative Agent on behalf of the Class C Purchasers shall have received on the Closing Date the following items, each of which shall be in form and substance satisfactory to the Administrative Agent: (i) an Officer's Certificate of FCNB confirming the satisfaction of the conditions set forth in clauses (a) and (c); (ii) a copy of (A) the certificate of incorporation and by-laws of, and an incumbency certificate with respect to its officers executing any of the Related Documents on the Closing Date on behalf of FCNB, certified by its authorized officer, and (B) resolutions of the Board of Directors (or an authorized committee thereof) of FCNB with respect to the Related Documents to which it is party, certified by its authorized officer; (iii) a certificate issued on a recent date by the Comptroller of the Currency evidencing the legal existence and good standing of FCNB as a national banking association; (iv) the favorable written opinions of counsel for the Issuer, the Owner Trustee, the Indenture Trustee and FCNB, addressed to the Administrative Agent and Class C Purchaser, or accompanied by a letter providing that the Administrative Agent and Class C Purchaser may rely on such opinions as if they were addressed to them, and dated the Closing Date, covering general corporate matters, the due execution and delivery of, and the enforceability of, each of the Related Documents to which the Issuer, the Owner Trustee, the -21- Indenture Trustee and FCNB (individually or in any other capacity) is party, sale/security interest matters and such other matters as the Administrative Agent may request; (v) evidence of the due execution and delivery by the Owner Trustee, on behalf of the Trust, and the Indenture Trustee of the Related Documents to which each is party; (vi) an executed copy of the Pooling and Servicing Agreement, the Collateral Series Supplement, the Transfer and Servicing Agreement, the Master Indenture, the Supplemental Indenture, the Trust Agreement and the Administration Agreement; (vii) a certificate of the Indenture Trustee as to the establishment of certain accounts as provided in the Indenture; (viii) the duly executed Class C Note(s) registered in the name of the Administrative Agent as nominee on behalf of the Class C Owners; (ix) evidence satisfactory to the Administrative Agent that financing statements duly executed by First Consumers Master Trust, FCNB and the Issuer or other, similar instruments or documents, as may be necessary or, in the opinion of the Administrative Agent or any Class C Purchaser, desirable under the Uniform Commercial Code of all appropriate jurisdictions or any comparable law to perfect the transfers (including grants of security interests) under the Related Documents have been delivered and, if appropriate, have been duly filed or recorded and that all filing fees, taxes or other amounts required to be paid in connection therewith have been paid; (x) certified copies of requests for information or copies (or a similar search report certified by a party acceptable to the Administrative Agent), dated a date reasonably near to the Closing Date, listing all effective financing statements which name First Consumers Master Trust, FCNB or the Issuer (under its present name and any previous name) as debtor and which are filed in the jurisdictions in which the statements referred to in clause (x) above were or are to be filed, together with copies of such financing statements (none of which, other than financing statements naming the party under the Related Documents to which transfers (including grants of security interests) thereunder purport to have been made shall cover any of the property purported to be conveyed thereunder); (xi) evidence satisfactory to the Administrative Agent that the Class C Notes have been rated at least Baa2 by Moody's Investors Service and BBB by Standard & Poor's. (xii) evidence satisfactory to each initial CP Conduit that its purchase of Class C Notes and Class C Note Principal Balance Increases hereunder will not result in a reduction or withdrawal of the rating of its Commercial Paper Notes by Moody's, S&P or any other nationally recognized rating agency -22- (xiii) evidence satisfactory to the Administrative Agent that all amounts outstanding under First Consumers Master Trust Series 2000-A have been repaid in full; (xiv) evidence satisfactory to the Administrative Agent that no action, suit, proceeding or investigation by or before any Governmental Authority shall have been instituted to restrain or prohibit the consummation of, or to invalidate, the transactions contemplated by the Related Documents in any material respect; and (xv) such additional documents, instruments, certificates or letters as the Administrative Agent or Class C Purchaser may reasonably request. ARTICLE 4 REPRESENTATIONS AND WARRANTIES 4.1 Representations and Warranties of FCNB. FCNB represents and -------------------------------------- warrants to the Class C Purchasers and the Administrative Agent that the representations and warranties of FCNB (as Seller or Servicer set forth in the Transfer and Servicing Agreement, the Indenture and the other Related Documents are true and correct as of the date hereof (except for representations or warranties which relate to a specific date, which shall be true and correct as of such date). FCNB further represents and warrants to, and agrees with, each Class C Purchaser and the Administrative Agent that, as of the date hereof: (a) FCNB is a national banking association duly organized, validly existing and in good standing under the laws of the United States of America, with full power and authority under such laws to own its properties and conduct its business as such properties are presently owned and such business is presently conducted and to execute, deliver and perform its obligations under this Agreement and the Related Documents to which it is a party. (b) FCNB has the power and authority to execute, deliver and perform this Agreement and the Related Documents to which it is a party and all the transactions contemplated hereby and thereby and has taken all necessary action to authorize the execution, delivery and performance of this Agreement and such Related Documents. When executed and delivered, each of this Agreement and each Related Document to which FCNB is a party will constitute the legal, valid and binding agreement of FCNB, enforceable in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, reorganization, insolvency, moratorium and other laws of general applicability relating to or affecting creditors' rights generally and the rights of creditors from time to time in effect. The enforceability of FCNB's obligations under such agreements is also subject to general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law, and indemnification sought in respect of securities laws violations may be limited by public policy. (c) No consent, license, approval or authorization of, or registration with, any governmental authority, bureau or agency is required to be obtained in connection with the execution, delivery or performance of each of this Agreement or any Related Documents that has not been duly obtained and which is not and will not be in full force and effect on the Closing Date, except such that may be required by the blue sky laws of any state and except those which -23- the failure to obtain individually or in the aggregate, would not have a material adverse effect on the Issuer or FCNB or the transactions contemplated by, or the ability of the Issuer or FCNB to perform its respective obligations under, this Agreement or the Related Documents. (d) The execution, delivery and performance of each of this Agreement and the Related Documents do not violate any provision of any existing law or regulation applicable to FCNB, any order or decree of any court to which FCNB is subject, its charter or by-laws or any mortgage, indenture, contract or other agreement to which FCNB is a party or by which it or any significant portion of FCNB's properties is bound (other than violations of such laws, regulations, orders, decrees, mortgages, indentures, contracts and other agreements which do not affect the legality, validity or enforceability of any of such agreements or the Receivables and which, individually or in the aggregate, would not have a material adverse effect on the Issuer or FCNB or the transactions contemplated by, or the ability of the Issuer or FCNB to perform its respective obligations under, this Agreement or the Related Documents). (e) There is no litigation or administrative proceeding before any court, tribunal or governmental body presently pending or, to the knowledge of FCNB, threatened, against FCNB with respect to this Agreement and the Related Documents, the transactions contemplated hereby or thereby or the issuance of the Series 2001-A Notes, and there is no such litigation or proceeding against FCNB or any significant portion of FCNB properties, in each case which would have a material adverse effect on the Issuer or FCNB or the transactions contemplated by, or the ability of the Issuer or FCNB to perform its respective obligations under, this Agreement or the Related Documents. (f) The Indenture is duly qualified or is not required to be qualified under the Trust Indenture Act of 1939, and the Issuer is not required to be registered under the Investment Company Act. (g) The aggregate amount of the Receivables in the Accounts as of February 28, 2001 was $1,115,087,125, consisting of $1,085,999,637 of Principal Receivables and $29,087,488 of Finance Charge Receivables. (h) On the Closing Date and after giving effect to the purchase of the Class C Noteholders' Interest and the issuance of the Series 2001-A Notes, no Series 2001-A Pay Out Event has occurred and is continuing, and no event, act or omission has occurred and is continuing which, with the lapse of time, the giving of notice or both, would constitute a Series 2001-A Pay Out Event. (i) When the Registration Statement became effective, when the Prospectus was first filed pursuant to Rule 424(b) under the Act, when any amendment or supplement to the Registration Statement or Prospectus is filed with the Commission, and at the Closing Date, neither the Registration Statement nor the Prospectus nor any amendment thereof or any supplement thereto (a) contained or will contain any untrue statement of a material fact or omitted or will omit to state any material fact necessary to make the statements therein, in the -24- light of the circumstances under which they were made, not misleading or (b) disclosed or will disclose the identity of the Administrative Agent or any Class C Purchaser. (j) FCNB has delivered to the Agent complete and correct copies of the publicly available portions of FCNB's Consolidated Reports of Condition and Income for the quarter ended December 31, 2000. There has not been any material adverse change in the business, operations, financial condition, properties or assets of the Seller since the quarter ended December 31, 2000 except as disclosed in the Prospectus. 4.2 Representations and Warranties of the Issuer. The Issuer -------------------------------------------- represents and warrants to the Class C Purchasers and the Administrative Agent that the representations and warranties of the Issuer set forth in the Transfer and Servicing Agreement, the Indenture and the other Related Documents are true and correct as of the date hereof (except for representations or warranties which relate to a specific date, which shall be true and correct as of such date). The Issuer further represents and warrants to, and agrees with, each Class C Purchaser and the Administrative Agent that, as of the date hereof: (a) The Issuer is a common law trust duly organized, validly existing and in good standing under the laws of the State of Illinois, with full power and authority under such laws to own its properties and conduct its business as such properties are presently owned and such business is presently conducted and to execute, deliver and perform its obligations under this Agreement and the Related Documents to which it is a party. (b) The Issuer has the power and authority to execute, deliver and perform this Agreement and the Related Documents to which it is a party and all the transactions contemplated hereby and thereby and has taken all necessary trust action to authorize the execution, delivery and performance of this Agreement and such Related Documents. When executed and delivered, each of this Agreement and each Related Document to which the Issuer is a party will constitute the legal, valid and binding agreement of the Issuer, enforceable in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, reorganization, insolvency, moratorium and other laws of general applicability relating to or affecting creditors' rights generally and the rights of creditors from time to time in effect. The enforceability of the Issuer's obligations under such agreements is also subject to general principles of equity, regardless of whether such enforceability is considered in a proceeding in equity or at law, and indemnification sought in respect of securities laws violations may be limited by public policy. (c) No consent, license, approval or authorization of, or registration with, any governmental authority, bureau or agency is required to be obtained in connection with the execution, delivery or performance of each of this Agreement or any Related Documents that has not been duly obtained and which is not and will not be in full force and effect on the Closing Date, except such that may be required by the blue sky laws of any state and except those which the failure to obtain individually or in the aggregate, would not have a material adverse effect on the Issuer or FCNB or the transactions contemplated by, or Issuer's ability to perform its obligations under, this Agreement or the Related Documents. -25- (d) The execution, delivery and performance of each of this Agreement and the Related Documents do not violate any provision of any existing law or regulation applicable to the Issuer, any order or decree of any court to which the Issuer is subject, its governing instrument or any mortgage, indenture, contract or other agreement to which the Issuer is a party or by which it or any significant portion of the Issuer's properties is bound (other than violations of such laws, regulations, orders, decrees, mortgages, indentures, contracts and other agreements which do not affect the legality, validity or enforceability of any of such agreements or the Receivables and which, individually or in the aggregate, would not have a material adverse effect on the Issuer or the transactions contemplated by, or the Issuer's ability to perform its respective obligations under, this Agreement or the Related Documents.) (e) There is no litigation or administrative proceeding before any court, tribunal or governmental body presently pending or, to the knowledge of the Issuer, threatened, against the Issuer with respect to this Agreement and the Related Documents, the transactions contemplated hereby or thereby or the issuance of the Series 2001-A Notes, and there is no such litigation or proceeding against the Issuer or any significant portion of the Issuer properties, in each case which would have a material adverse effect on the Issuer or the transactions contemplated by, or the ability of the Issuer to perform its obligations under, this Agreement or the Related Documents. (f) The Indenture is duly qualified or is not required to be qualified under the Trust Indenture Act of 1939, and the Issuer is not required to be registered under the Investment Company Act. (g) On the Closing Date and after giving effect to the purchase of the Class C Noteholders' Interest and the issuance of the Series 2001-A Notes, no Series 2001-A Pay Out Event has occurred and is continuing, and no event, act or omission has occurred and is continuing which, with the lapse of time, the giving of notice or both, would constitute a Series 2001-A Pay Out Event. 4.3 Representations and Warranties of the Class C Purchasers. -------------------------------------------------------- Each of the Class C Purchasers severally (each with respect to itself only) represents and warrants to, and agrees with, the Issuer, FCNB and the Servicer that: (a) Such Class C Purchaser has been duly authorized and is validly existing and in good standing under the laws of its jurisdiction of organization, with power and authority to own its properties and to transact the business in which it is now engaged; (b) Such Class C Purchaser has all requisite power and authority to enter into and perform its obligations under this Agreement and to consummate the transactions contemplated hereby and thereby. The execution and delivery by such Class C Purchaser of this Agreement and the consummation by such Class C Purchaser of the transactions contemplated hereby have been duly and validly authorized by all necessary corporation action on the part of such Class C Purchaser. This Agreement has been duly and validly executed and delivered by such Class C Purchaser and constitutes a legal, valid and binding obligation of such Class C -26- Purchaser, enforceable against such Class C Purchaser in accordance with its terms, subject as to enforcement to bankruptcy, reorganization, insolvency, moratorium and other similar laws of general applicability relating to or affecting creditors' rights and to general principles of equity. Neither the execution and delivery by such Class C Purchaser of this Agreement nor the consummation by such Class C Purchaser of any of the transactions contemplated hereby, nor the fulfillment by such Class C Purchaser of the terms hereof, will conflict with, or violated, result in a breach of or constitute a default under (i) any term or provision of the certificate of incorporation or articles of association or By-laws of such Class C Purchaser or any Requirement of Law applicable to such Class C Purchaser or (ii) any term or provision of any indenture or other agreement or instrument, to which such Class C Purchaser is a party or by which such Class C Purchaser or any portion of its properties are bound; (c) Such Class C Purchaser understands and agrees that receipt by the Issuer of a duly executed Investment Letter pursuant to Section 8.1 hereof is a condition precedent to the Issuer's obligations hereunder to sell the Class C Notes; (d) Such Class C Purchaser is not required to register as an "investment company" nor is such Class C Purchaser controlled by an "investment company" within the meaning of the Investment Company Act of 1940, as amended.; and (e) No registration with, consent or approval of or other action by any federal, state, or other governmental authority or regulatory body having jurisdiction over such Class C Purchaser is required in connection with the execution, delivery or performance by such Class C Purchaser of this Agreement. ARTICLE 5 COVENANTS 5.1 Covenants. Each of FCNB, the Servicer and the Issuer --------- severally covenants and agrees, in each case as to itself individually or in such respective capacities, each with respect to itself only, through the Series Termination Date and thereafter so long as any amount of the Class C Note Principal Balance shall remain outstanding or any monetary obligation arising hereunder shall remain unpaid, unless the Required Class C Owners shall otherwise consent in writing, that: (a) Each of FCNB, the Servicer and the Issuer shall perform in all material respects each of the respective agreements, warranties and indemnities applicable to it under the Related Documents and comply in all material respects with each of the respective terms and provisions applicable to it under the Related Documents to which it is party, which agreements, warranties and indemnities are hereby incorporated by reference into this Agreement as if set forth herein in full; and each of the Servicer and the Issuer shall take all reasonable actions to enforce the obligations of each of the other parties to Pooling and Servicing Agreement, the Collateral Series Supplement and the Collateral Certificate which are contained therein; (b) The Seller, the Issuer and the Servicer, as applicable, shall promptly furnish to the Administrative Agent (i) a copy of each certificate, report, statement, notice or -27- other communication (including without limitation, a copy of any Opinion of counsel delivered pursuant to Section 8.9 of the Indenture) furnished by or on behalf of the Seller, the Issuer or the Servicer, as applicable, to the holders of Series 2001-A Notes, to the Indenture Trustee or to the Rating Agencies (other than any portion of any such communication relating to other outstanding Series) concurrently therewith and furnish to the Administrative Agent promptly after receipt thereof a copy of each notice, demand or other communication received by or on behalf of the Seller, the Issuer or the Servicer, as applicable, pursuant to this Agreement, the Transfer and Servicing Agreement, the Indenture, the Indenture Supplement or any Pooling and Servicing Agreement or the Collateral Series Supplement (other than any portion of any such communication relating to other outstanding Series), and (ii) such other information, documents records or reports respecting the Accounts, the Receivables, the Issuer, the Seller or the Servicer which is in the possession or under the control of the Issuer, the Seller or the Servicer, as the case may be, as the Administrative Agent may from time to time reasonably request. Each such communication provided hereunder shall be furnished to the Administrative Agent in writing; (c) The Issuer or the Servicer, as applicable, shall furnish to the Administrative Agent (i) a copy of each annual certified public accountants' reports received by the Indenture Trustee pursuant to Section 3.6 of the Transfer and Servicing Agreement (other than any portion of such reports relating to other outstanding Series), (ii) with respect to each Distribution Date with respect to the Transfer and Servicing Agreement, a copy of the completed report furnished to the Indenture Trustee pursuant to Section 3.4(b) of the Transfer and Servicing Agreement, and (iii) a copy of any other report furnished to the Indenture Trustee pursuant to Section 3.5 of the Transfer and Servicing Agreement (other than any portion of such reports relating to other outstanding Series); (d) There shall be no assets included in the Trust Assets other than any Collateral Certificate or, upon termination of the First Consumers Master Trust, the assets previously included in or includible in the First Consumers Master Trust or as consented to by the Administrative Agent; (e) Each of FCNB, the Servicer and the Issuer shall furnish to the Administrative Agent promptly after known to such party, information with respect to any action, suit or proceeding involving such party or any of its Affiliates (other than, in the case of the Servicer, FCNB and the Issuer) by or before any court or any Governmental Authority which, if adversely determined, would be reasonably likely to result in a material and adverse effect on such party or the transactions contemplated by, or such party's ability to perform its obligations under, this Agreement or the Related Documents; (f) From the Closing Date until the Termination Date, each of the Issuer, the Seller and the Servicer, as applicable, will, at any time and from time to time during regular business hours, on at least five Business Days' (or if a Series 2001-A Pay Out Event or event or condition which, with the passage of time or the giving of notice, or both, would become a Series 2001-A Pay Out Event has occurred, one Business Day's) notice to the Issuer, the Seller or the Servicer, as the case may be, permit the Administrative Agent, or its agents or representatives, at the Issuer's, the Seller's and the Servicer's, as applicable, reasonable cost and expense if a Series -28- 2001-A Pay Out Event has occurred (and otherwise at the expense of the Administrative Agent), (i) to examine all books, records and documents (including computer tapes and disks) in the possession or under the control of the Issuer, the Seller or the Servicer, as the case may be, relating to the Receivables (other than names of account holders and strategic plans for the Servicer's credit card business and other than any portion of such books, records and documents relating to other outstanding Series), including the forms of Credit Card Agreements under which such Receivables arise, and (ii) to visit the offices and properties of the Issuer, the Seller or the Servicer, as applicable, for the purpose of examining such materials described in clause (i) above. Any information obtained by the Administrative Agent pursuant to this Section 5.1(f) shall be held in confidence by the Administrative Agent in accordance with the provisions of Section 6.2 hereof, except that the Administrative Agent may disclose such information to any Class C Purchaser which shall hold such information in accordance with the provisions of Section 6.2 hereof; (g) Except for New Issuances in accordance with Section 2.12 of the Indenture and modifications to Supplemental Indentures with respect to Series other than Series 2001-A and except for terminations, amendments, waiver and modifications of Related Documents otherwise permitted hereunder, none of FCNB, the Servicer or the Issuer shall take any action which, under the terms of the Related Documents, requires the satisfaction of the Rating Agency Condition, if such action would materially adversely affect the Class C Purchasers, unless such action has been consented to by the Required Class C Owners; (h) Neither the Seller nor the Issuer shall reduce or withdraw any Discount Percentage if the Early Amortization Commencement Date has occurred. Neither the Seller nor the Issuer shall reduce or withdraw any Discount Percentage unless it shall have delivered to the Administrative Agent an Officer's Certificate of the Servicer stating that the Servicer reasonably believes that such reduction or withdrawal will not (i) result in the occurrence of a Series 2001-A Pay Out Event or (ii) cause the Portfolio Yield to be less than the Base Rate; (i) FCNB shall not amend the Collateral Certificate, the Pooling and Servicing Agreement, the Collateral Series Supplement or any other Related Document in any respect which could have a material adverse effect on the Class C Purchasers without the prior written consent of by the Required Class C Owners; (j) Any determination to be made by FCNB, the Servicer or the Issuer pursuant to any Related Document that a matter does not adversely or materially adversely affect (within the meaning of such Related Document) the interests of Noteholders shall not be made unless such matter does not adversely or materially adversely affect the interests of the Class C Purchasers; (k) The Issuer shall not exercise its optional right to repay all Class C Notes pursuant to Section 7.1 of the Supplemental Indenture, unless the Class C Purchasers and the Administrative Agent have been paid, or will be paid upon such purchase or in connection with such optional repayment, the Class C Note Principal Balance, all interest thereon and all other amounts owing hereunder in full; -29- (l) The Servicer shall furnish to the Administrative Agent, promptly after the occurrence of any Series 2001-A Pay Out Event, a certificate of an appropriate officer of the Servicer setting forth the circumstances of such Series 2001-A Pay Out Event and any action taken or proposed to be taken by the Servicer, FCNB or the Issuer with respect thereto; (m) Each of the Seller, the Issuer and the Servicer, as applicable, shall not terminate (except in accordance with the terms thereof and only if at the time of such termination none of the Class C Note Principal Balance or other amount payable to the Administrative Agent and the Class C Purchasers hereunder is unpaid), amend, waive or otherwise modify any Transaction Document to which it is a party in any manner which, under the terms of the Transaction Documents, requires the satisfaction of the Rating Agency Condition without the prior written consent of the Administrative Agent, unless the Seller, the Issuer or the Servicer, as applicable, delivers to the Administrative Agent an Officer's Certificate, in form and substance satisfactory to the Administrative Agent, to the effect that such amendment, waiver or modification does not adversely affect the interest of the Class C Purchasers in any material respect. Each of the Seller, the Issuer and the Servicer, as applicable, shall not terminate (except in accordance with the terms thereof and only if at the time of such termination none of the Class C Note Principal Balance or other amount payable to the Administrative Agent and the Class C Purchasers hereunder is unpaid), amend, waive or otherwise modify the Indenture Supplement without the prior written consent of the Administrative Agent; (n) There shall be no Series of Notes other than Series 2001-A included in Group One without the prior written consent of the Required Class C Owners if after giving effect to the issuance of such Series the weighted average coupon on the outstanding securities issued by First Consumers Master Trust and the Issuer exceeds 9.00%. There shall be no Series of Notes paired with Series 2001-A without the prior written consent of the Required Class C Owners; and (o) The Servicer shall furnish to the Rating Agencies, promptly after the occurrence of any Cap Increase Event, written notice thereof. -30- ARTICLE 6 MUTUAL COVENANTS REGARDING CONFIDENTIALITY 6.1 Covenants. Each of FCNB, the Servicer and the Issuer, --------- severally and with respect to itself only, covenants and agrees to hold in confidence, and not disclose to any Person, the terms of any fees payable in connection with this Agreement or the identity of any CP Conduit which is an agent, a purchaser or beneficial owner of Class C Notes under this Agreement, except as the Administrative Agent or Class C Purchaser, as the case may be, may have consented to in writing prior to any proposed disclosure and except it may disclose such information (i) to its officers, directors, employees, agents, counsel, accountants, auditors, advisors or representatives or (ii) to the extent it should be (A) required by law, rule or regulation or in connection with any legal or regulatory proceeding or (B) requested by any Governmental Authority to disclose such information; provided, that, in the case of clause -------- (ii)(A), FCNB, the Servicer or the Issuer, as applicable, will use all reasonable efforts to maintain confidentiality and will (unless otherwise prohibited by law) notify the affected Administrative Agent or Class C Purchaser of its intention to make any such disclosure prior to making such disclosure. It is expressly hereby acknowledged that nothing contained in this paragraph be deemed to prohibit disclosure of the identity of the Administrative Agent under this Agreement by FCNB, the Servicer or the Issuer. 6.2 Covenants of Class C Purchasers. The Administrative Agent and ------------------------------- each Class C Purchaser, severally and with respect to itself only, covenants and agrees that any nonpublic information obtained by it pursuant to this Agreement shall be held in confidence (it being understood that documents provided to the Administrative Agent or any Class C Purchaser hereunder may in all cases be distributed to the Administrative Agent or to any Class C Purchaser) except that the Administrative Agent or Class C Purchaser may disclose such information (i) to its officers, directors, employees, agents, counsel, accountants, auditors, advisors or representatives, (ii) to the extent such information has become available to the public other than as a result of a disclosure by or through the Administrative Agent or Class C Purchaser, (iii) to the extent such information was available to the Administrative Agent or such Class C Purchaser on a nonconfidential basis prior to its disclosure to the Administrative Agent or any Class C Purchaser hereunder, (iv) with the consent of the affected party, (v) to the extent permitted by Section 8.1 of this Agreement, (vi) in the case of any Class C Purchaser that is a CP Conduit, to placement agents and providers of liquidity and credit support who agree to hold such information in confidence or to rating agencies, or (vii) to the extent the Administrative Agent or such Class C Purchaser should be (A) required by law, rule or regulation or in connection with any legal or regulatory proceeding or (B) requested by any Governmental Authority to disclose such information; provided, that in the case -------- of clause (vii)(A), the Administrative Agent or Class C Purchaser, as the case may be, will use all reasonable efforts to maintain confidentiality and will (unless otherwise prohibited by law) notify the affected party of its intention to make any such disclosure prior to making any such disclosure. -31- ARTICLE 7 THE ADMINISTRATIVE AGENT 7.1 Appointment. Each Class C Purchaser hereby irrevocably ----------- designates and appoints the Administrative Agent as the agent of such Class C Purchaser under this Agreement, and each such Class C Purchaser irrevocably authorizes the Administrative Agent, as the agent for such Class C Purchaser, to take such action on its behalf under the provisions of the Related Documents and to exercise such powers and perform such duties thereunder as are expressly delegated to the Administrative Agent by the terms of the Related Documents, together with such other powers as are reasonably incidental thereto. Notwithstanding any provision to the contrary elsewhere in this Agreement, the Administrative Agent shall not have any duties or responsibilities, except those expressly set forth herein, or any fiduciary relationship with any Class C Purchaser, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or otherwise exist against any Administrative Agent. 7.2 Delegation of Duties. The Administrative Agent may execute -------------------- any of its duties under any of the Related Documents by or through agents or attorneys-in-fact and shall be entitled to advice of counsel concerning all matters pertaining to such duties. The Administrative Agent shall not be responsible for the negligence or misconduct of any agents or attorneys-in-fact selected by it with reasonable care. 7.3 Exculpatory Provisions. Neither the Administrative Agent nor ---------------------- any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates shall be (a) liable to any of the Class C Purchasers for any action lawfully taken or omitted to be taken by it or such Person under or in connection with any of the other Related Documents (except for its or such Person's own gross negligence or willful misconduct) or (b) responsible in any manner to any of the Class C Purchasers for any recitals, statements, representations or warranties made by FCNB, the Servicer, the Issuer or the Indenture Trustee or any officer thereof contained in any of the other Related Documents or in any certificate, report, statement or other document referred to or provided for in, or received by the Administrative Agent under or in connection with, any of the other Related Documents or for the value, validity, effectiveness, genuineness, enforceability or sufficiency of this Agreement or any of the other Related Documents or for any failure of FCNB, the Servicer, the Issuer or the Indenture Trustee to perform its obligations thereunder. No Administrative Agent shall be under any obligation to any Class C Purchaser to ascertain or to inquire as to the observance or performance of any of the agreements contained in, or conditions of, any of the other Related Documents, or to inspect the properties, books or records of FCNB, the Servicer, the Issuer or the Indenture Trustee. 7.4 Reliance by Agents. The Administrative Agent shall be ------------------ entitled to rely, and shall be fully protected in relying, upon any writing, resolution, notice, consent, certificate, affidavit, letter, cablegram, telegram, telecopy, telex or teletype message, written statement, order or other document or conversation believed by it to be genuine and correct and to have been signed, sent or made by the proper Person or Persons and upon advice and statements of legal counsel (including counsel to the Administrative Agent), independent accountants and other experts selected by the Administrative Agent. The Administrative Agent shall be fully justified in failing or refusing to take any action under any of the Related Documents unless it -32- shall first receive such advice or concurrence of the Required Class C Owners as it deems appropriate or it shall first be indemnified to its satisfaction by the Class C Purchasers against any and all liability and expense which may be incurred by it by reason of taking or continuing to take any such action. The Administrative Agent shall in all cases be fully protected in acting, or in refraining from acting, under any of the Related Documents in accordance with a request of the Required Class C Owners, and such request and any action taken or failure to act pursuant thereto shall be binding upon all present and future Class C Purchasers. 7.5 Notices. The Administrative Agent shall not be deemed to have ------- knowledge or notice of the occurrence of any breach of this Agreement or the occurrence of any Series 2001-A Pay Out Event unless the Administrative Agent has received notice from the Issuer, the Servicer, the Indenture Trustee or any Class C Purchaser, referring to this Agreement and describing such event. In the event that the Administrative Agent receives such a notice, it shall promptly give notice thereof to the Class C Purchasers. The Administrative Agent shall take such action with respect to such event as shall be reasonably directed by the Required Class C Owners; provided that unless and until the Administrative -------- Agent shall have received such directions, the Administrative Agent may (but shall not be obligated to) take such action, or refrain from taking such action, with respect to such event as it shall deem advisable in the best interests of the Class C Purchasers. 7.6 Non-Reliance on Agent and Other Class C Purchasers. Each -------------------------------------------------- Class C Purchaser expressly acknowledges that neither the Administrative Agent nor any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates has made any representations or warranties to it and that no act by the Administrative Agent hereafter taken, including any review of the affairs of FCNB, the Servicer, the Issuer or the Indenture Trustee shall be deemed to constitute any representation or warranty by the Administrative Agent to any Class C Purchaser. Each Class C Purchaser represents to the Administrative Agent that it has, independently and without reliance upon the Administrative Agent or any other Class C Purchaser, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of FCNB, the Servicer, the Issuer, First Consumers Master Trust, the Collateral Certificate, the Accounts, the Receivables and the Indenture Trustee and made its own decision to purchase its interest in the Class C Notes hereunder and enter into this Agreement. Each Class C Purchaser also represents that it will, independently and without reliance upon the Administrative Agent or any other Class C Purchaser, and based on such documents and information as it shall deem appropriate at the time, continue to make its own analysis, appraisals and decisions in taking or not taking action under any of the Related Documents, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of FCNB, the Servicer, the Issuer, First Consumers Master Trust, the Collateral Certificate, the Accounts, the Receivables and the Indenture Trustee. Except for notices, reports and other documents received by the Administrative Agent under Section 5 hereof, the Administrative Agent shall have any duty or responsibility to provide any Class C Purchaser with any credit or other information concerning the business, operations, property, condition (financial or otherwise), prospects or creditworthiness of FCNB, the Servicer, the Issuer, First Consumers Master Trust, the Collateral -33- Certificate, the Accounts, the Receivables or the Indenture Trustee which may come into the possession of the Administrative Agent or any of its officers, directors, employees, agents, attorneys-in-fact or Affiliates. 7.7 Indemnification. The Purchasers (other than the CP Conduits) --------------- agree to indemnify the Administrative Agent in its capacity as such (without limiting the obligation (if any) of FCNB, the Servicer or the Issuer to reimburse the Administrative Agent for any such amounts), ratably according to their respective Percentage Interests from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever which may at any time (including at any time following the payment of the obligations under this Agreement, including the Class C Note Principal Balance) be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of this Agreement, or any documents contemplated by or referred to herein or the transactions contemplated hereby or any action taken or omitted by the Administrative Agent under or in connection with any of the foregoing; provided that no Class C Purchaser shall be liable for the payment of any - -------- portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of the Administrative Agent resulting from its own gross negligence or willful misconduct. The agreements in this subsection shall survive the payment of the obligations under this Agreement, including the Class C Note Principal Balance. 7.8 Agent in its Individual Capacity. The Administrative Agent -------------------------------- and its Affiliates may make loans to, accept deposits from and generally engage in any kind of business with FCNB, the Servicer or the Issuer as though the Administrative Agent were not an agent hereunder. In addition, the Class C Purchasers acknowledges that DBNY may act (i) as administrator, sponsor or agent for one or more CP Conduits and in such capacity acts and may continue to act on behalf of each such CP Conduit in connection with its business, and (ii) as the agent for certain financial institutions under the liquidity and credit enhancement agreements relating to this Agreement to which any one or more CP Conduits is party and in various other capacities relating to the business of any such CP Conduit under various agreements. DBNY, in its capacity as Administrative Agent, shall not, by virtue of its acting in any such other capacities, be deemed to have duties or responsibilities hereunder or be held to a standard of care in connection with the performance of its duties as the Administrative Agent other than as expressly provided in this Agreement. Any Person which is the Administrative Agent may act as the Administrative Agent without regard to and without additional duties or liabilities arising from its role as such administrator or agent or arising from its acting in any such other capacity. 7.9 Successor Agent. The Administrative Agent may resign as --------------- Administrative Agent upon thirty days' notice to the Class C Purchasers, the Indenture Trustee, the Issuer and the Servicer with such resignation becoming effective upon a successor agent succeeding to the rights, powers and duties of the Administrative Agent pursuant to this Section 7.9. If the Administrative Agent shall resign as Administrative Agent under this Agreement, then the Required Class C Owners shall appoint from among the Class C Purchasers a successor administrative agent. Any successor administrative agent shall succeed to the rights, powers and duties of resigning Administrative Agent, and the term "Administrative Agent" shall mean such -34- successor administrative agent or agent effective upon its appointment, and the former Administrative Agent's rights, powers and duties as Administrative Agent shall be terminated, without any other or further act or deed on the part of such former Administrative Agent or any of the parties to this Agreement. After the retiring Administrative Agent's resignation as Administrative Agent, the provisions of this Section 7 shall inure to its benefit as to any actions taken or omitted to be taken by it while it was Administrative Agent under this Agreement. ARTICLE 8 SECURITIES LAWS; TRANSFERS 8.1 Transfers of Class C Notes. -------------------------- (a) Each initial Class C Purchaser shall execute and deliver to the Issuer on the Closing Date an Investment Letter substantially in the form attached hereto as Exhibit B (an "Investment Letter"). Each Class C Owner agrees --------- ----------------- that the beneficial interest in the Class C Notes purchased by it will be acquired for investment only and not with a view to any public distribution thereof, and that such Class C Owner will not offer to sell or otherwise dispose of any Class C Note acquired by it (or any interest therein) in violation of any of the requirements of the Securities Act or any applicable state or other securities laws. Each Class C Owner acknowledges that it has no right to require the Issuer to register, under the Securities Act of 1933, as amended, or any other securities law, the Class C Notes (or the beneficial interest therein) acquired by it pursuant to this Agreement or any Transfer Supplement. Each Class C Owner hereby confirms and agrees that in connection with any transfer or syndication by it of an interest in the Class C Notes, such Class C Owner has not engaged and will not engage in a general solicitation or general advertising including advertisements, articles, notices or other communications published in any newspaper, magazine or similar media or broadcast over radio or television, or any seminar or meeting whose attendees have been invited by any general solicitation or general advertising. (b) Each initial purchaser of a Class C Note or any interest therein and any Assignee thereof or Participant therein shall certify to the Issuer, the Seller, the Servicer, the Indenture Trustee and the Administrative Agent that it is either (i) a citizen or resident of the United States, (ii) a corporation or other entity organized in or under the laws of the United States or any political subdivision thereof or (iii) a person not described in (i) or (ii) who is entitled to receive payments under this Agreement and with respect to the Class C Notes without deduction or withholding of any United States federal income taxes and whose ownership of any interest in a Class C Note will not result in any withholding obligation with respect to any payments with respect to the Class C Notes by any Person (other than withholding, if any, under Section 1446 of the Code) and who will furnish to the Issuer, the Seller, the Servicer, the Indenture Trustee, the Administrative Agent and to the Class C Owner making the Transfer the forms described in subsection 2.4(c). (c) Any sale, transfer, assignment, participation, pledge, hypothecation or other disposition (a "Transfer") of a Class C Note or any -------- interest therein may be made only in accordance with this Section 8.1. Any Transfer of an interest in a Class C Note shall be in respect of, at least $5,000,000 in the aggregate. Any Transfer of an interest in a Class C Note -35- otherwise permitted by this Section 8.1 will be permitted only if it consists of a pro rata percentage interest in all payments made with respect to the Class C -------- Purchaser's beneficial interest in such Class C Note. No Class C Note or any interest therein may be Transferred by Assignment or Participation to any Person (each, a "Transferee") unless the Transferee is a Permitted Transferee and prior ---------- to the transfer the Transferee shall have executed and delivered to the Administrative Agent and the Issuer an Investment Letter. Each of FCNB, the Servicer and the Issuer authorizes each Class C Purchaser to disclose to any Transferee and Support Party and any prospective Transferee or Support Party any and all confidential information in the Class C Purchaser's possession concerning this Agreement or the Related Documents or concerning the Accounts, the Receivables or such party which has been delivered to any Class C Purchaser pursuant to this Agreement or the Related Documents (including information obtained pursuant to rights of inspection granted hereunder) or which has been delivered to such Class C Purchaser by or on behalf of FCNB, the Servicer or the Issuer in connection with such Class C Purchaser's credit evaluation of First Consumers Master Trust, the Collateral Certificate, the Accounts, the Receivables, FCNB, the Servicer or the Issuer prior to becoming a party to, or purchasing an interest in this Agreement or the Class C Notes; provided that prior to any such disclosure, such -------- Transferee or Support Party or prospective Transferee or Support Party shall have entered into a confidentiality agreement substantially in the form of Exhibit C hereto. - --------- (d) Each Class C Purchaser may, in accordance with applicable law, at any time grant participations in all or part of its interest in the Class C Notes, including the payments due to it under this Agreement and the Related Documents (each, a "Participation"), to any Permitted Transferee (each, ------------- a "Participant"); provided, however, that no Participation shall be granted to ----------- -------- ------- any Person unless and until the Administrative Agent shall have consented thereto and the conditions to Transfer specified in this Agreement, including in subsection 8.1(c) hereof, shall have been satisfied and that such Participation consists of a pro rata percentage interest in all payments made with respect to --- ---- such Class C Purchaser's beneficial interest (if any) in the Class C Notes. In connection with any such Participation, the Administrative Agent shall maintain a register of each Participant and the amount of each related Participation. Each Class C Purchaser hereby acknowledges and agrees that (A) any such Participation will not alter or affect such Class C Purchaser's direct obligations hereunder, and (B) neither the Indenture Trustee, the Seller, the Issuer nor the Servicer shall have any obligation to have any communication or relationship with any Participant. Each Class C Purchaser and each Participant shall comply with the provisions of subsection 2.4(c) of this Agreement. No Participant shall be entitled to Transfer all or any portion of its Participation, without the prior written consent of the Administrative Agent. Each Participant shall be entitled to receive additional amounts and indemnification pursuant to Sections 2.3, 2.4 and 2.5 hereof as if such Participant were a Class C Purchaser and such Sections applied to its Participation; provided, in the case of Section 2.4, that such Participant has -------- complied with the provisions of subsection 2.4(c) hereof as if it were a Class C Purchaser. Each Class C Purchaser shall give the Administrative Agent notice of the consummation of any sale by it of a Participation. -36- (e) Each Class C Purchaser may, with the consent of the Administrative Agent and in accordance with applicable law, sell or assign (each, an "Assignment"), to any Permitted Transferee (each, an "Assignee") all ---------- -------- or any part of its interest in the Class C Notes and its rights and obligations under this Agreement and the Related Documents pursuant to an agreement substantially in the form attached hereto as Exhibit D hereto (a "Transfer --------- -------- Supplement"), executed by such Assignee and the Class C Purchaser and delivered - ---------- to the Administrative Agent for its acceptance and consent; provided, however, -------- ------- that (i) no such assignment or sale shall be effective unless and until the conditions to Transfer specified in this Agreement, including in subsection 8.1(c) hereof, shall have been satisfied, and (ii) in no event shall the consent of the Administrative Agent be required in the case of an assignment by a CP Conduit of its interest in the Class C Notes and its rights and obligations under this Agreement and the Related Documents to any one or more of its Support Parties. From and after the effective date determined pursuant to such Transfer Supplement, (x) the Assignee thereunder shall be a party hereto and, to the extent provided in such Transfer Supplement, have the rights and obligations of a Class C Purchaser hereunder as set forth therein and (y) the transferor Class C Purchaser shall, to the extent provided in such Transfer Supplement, be released from its obligations under this Agreement; provided, however, that -------- ------- after giving effect to each such Assignment, the obligations released by any such Class C Purchaser shall have been assumed by an Assignee or Assignees. Such Transfer Supplement shall be deemed to amend this Agreement to the extent, and only to the extent, necessary to reflect the addition of such Assignee and the resulting adjustment of Percentage Interests arising from the Assignment. Upon its receipt and acceptance of a duly executed Transfer Supplement, the Administrative Agent shall on the effective date determined pursuant thereto give notice of such acceptance to the Issuer, the Servicer and the Indenture Trustee. Upon instruction to register a transfer of a Class C Purchaser's beneficial interest in the Class C Notes (or portion thereof) and surrender for registration of transfer of such Class C Purchaser's Class C Note(s) (if applicable) and delivery to the Issuer and the Indenture Trustee of an Investment Letter, executed by the registered owner (and the beneficial owner if it is a Person other than the registered owner), and receipt by the Indenture Trustee of a copy of the duly executed related Transfer Supplement and such other documents as may be required under this Agreement, such beneficial interest in the Class C Notes (or portion thereof) shall be transferred in the records of the Indenture Trustee and the Administrative Agent and, if requested by the Assignee, new Class C Notes shall be issued to the Assignee and, if applicable, the transferor Class C Purchaser in amounts reflecting such Transfer as provided in the Indenture. To the extent of any conflict between the provisions of this Section 8.1 and any provisions of Section 2.05 of the Master Indenture applicable to Transfers of Class C Notes (or interests therein), the provisions of this Section 8.1 shall control. Successive registrations of Transfers as aforesaid may be made from time to time as desired, and each such registration of a transfer to a new registered owner shall be noted on the Note Register. (f) Each Class C Purchaser may pledge its interest in the Class C Notes to any Federal Reserve Bank as collateral in accordance with applicable law. -37- (g) Any Class C Purchaser shall have the option to change its Investing Office, provided that such Class C Purchaser shall have prior to such -------- change in office complied with the provisions of subsection 2.4(c) hereof and provided further that such Class C Purchaser shall not be entitled to any - -------- ------- amounts otherwise payable under Section 2.3 or 2.4 hereof resulting solely from such change in office unless such change in office was mandated by applicable law or by such Class C Purchaser's compliance with the provisions of this Agreement. (h) Each Affected Party shall be entitled to receive additional payments and indemnification pursuant to Sections 2.3, 2.4 and 2.5 hereof as though it were a Class C Purchaser and such Section applied to its interest in or commitment to acquire an interest in the Class C Notes; provided that such -------- Affected Party shall not be entitled to additional payments pursuant to (i) Section 2.3 by reason of Regulatory Changes which occurred prior to the date it became an Affected Party or (ii) Section 2.4 attributable to its failure to satisfy the requirements of subsection 2.4(c) as if it were a Class C Purchaser, and provided further, that unless such Affected Party has been consented to by -------- ------- the Seller, such Affected Party shall be entitled to receive additional amounts pursuant to Sections 2.3 or 2.4 only to the extent that its related CP Conduit would have been entitled to receive such amounts in the absence of the commitment and Support Advances from such Affected Party. (i) Each Affected Party claiming increased amounts described in Sections 2.3 or 2.4 hereof shall furnish, through its related CP Conduit, to the Issuer, the Servicer, the Indenture Trustee and the Administrative Agent a certificate setting forth the basis and amount of each request by such Affected Party for any such amounts referred to in Sections 2.3 or 2.4, such certificate to be conclusive with respect to the factual information set forth therein absent manifest error. 8.2 Tax Characterization. It is the intention of the parties -------------------- hereto that the Class C Notes be treated for tax purposes as indebtedness, and the parties hereto agree to so treat the Class C Notes (to the extent permitted by law). -38- ARTICLE 9 MISCELLANEOUS 9.1 Amendments and Waivers. This Agreement may not be amended, ---------------------- supplemented or modified nor may any provision hereof be waived except in accordance with the provisions of this Section 9.1. With the written consent of the Required Class C Owners, the Administrative Agent, the Issuer, the Seller and the Servicer may, from time to time, enter into written amendments, supplements, waivers or modifications hereto for the purpose of adding any provisions to this Agreement or changing in any manner the rights of any party hereto or waiving, on such terms and conditions as may be specified in such instrument, any of the requirements of this Agreement; provided, however, that -------- ------- no such amendment, supplement, waiver or modification shall (i) reduce the amount or extend the maturity of any Class C Note or reduce the rate or extend the time of payment of interest thereon, or reduce or alter the timing of any other amount payable to any Class C Owner hereunder or under the Indenture, in each case without the consent of the Class C Owner affected thereby, (ii) amend, modify or waive any provision of this Section 9.1, or, if such amendment would have a material adverse effect on the Class C Purchasers, the definition of "Class C Note Principal Balance", or reduce the percentage specified in the definition of Required Class C Owners, in each case without the written consent of all Class C Owners or (iii) amend, modify or waive any provision of Section 7 of this Agreement without the written consent of the Administrative Agent. Any waiver of any provision of this Agreement shall be limited to the provisions specifically set forth therein for the period of time set forth therein and shall not be construed to be a waiver of any other provision of this Agreement. No such amendment, supplement, waiver or modification which would have a material, adverse effect on the Class C Purchasers shall be effective unless the Rating Agency Condition shall have been satisfied; it being understood that amendments, supplements, waivers and modifications of the type set forth in Section 10.1(a) of the Indenture shall not require satisfaction of the Rating Agency Condition. The Servicer shall give the Rating Agencies prior notice of any amendment, supplement, waiver or modification of this Agreement. The Administrative Agent may cast any vote or give any consent or direction under the Indenture or other Related Documentation on behalf of the Class C Noteholders Group if it has been directed to do so by the Required Class C Owners. 9.2 Notices. ------- (a) All notices, requests and demands to or upon the respective parties hereto to be effective shall be in writing (including by telecopy), and, unless otherwise expressly provided herein, shall be deemed to have been duly given or made when delivered by hand, or, in the case of mail or telecopy notice, when received, addressed as follows or, with respect to an Agent or Class C Purchaser, as set forth on the signature pages hereto or in its respective Transfer Supplement, or to such other address as may be hereafter notified by the respective parties hereto: -39- Issuer: First Consumers Credit Card Master Note Trust c/o Bankers Trust Company, as Owner Trustee Four Albany Street--10th Floor New York, NY 10006 Attention: Corporate Trust and Agency Services Telephone: 212-250-6323 Telecopy: 212-250-6439 with separate copies to FCNB. FCNB, Servicer or Seller: First Consumers National Bank 9300 S. W. Gemini Drive Beaverton, Oregon 97008 Attention: President Telephone: 503-520-8200 Telecopy: 503-520-0515 with a separate copy to: Spiegel, Inc. 3500 Lacey Road Downers Grove, IL 60515-5432 Attention: Treasurer Telephone: 630-769-3250 Telecopy: 630-769-3750 Indenture Trustee: The Bank of New York 101 Barclay Street, 12th Floor 12th Floor, East New York, New York 10286 Attention: Corporate Trust Administration Telephone: (212) 815-8195 Telecopy: (212) 815-5544 Administrative Deutsche Bank AG, New York Branch Agent: 31 West 52/nd/ Street New York, New York 10019 Attention: Structured Finance Telephone: (212) 469-4987 Telefax: (212) 469-5160 (b) All payments to be made to the Administrative Agent or any Class C Purchaser hereunder shall be made in United States dollars and in immediately available funds -40- not later than 2:00 p.m., New York City time, on the date payment is due, and, unless otherwise specifically provided herein, shall be made to the Administrative Agent, for the account of one or more of the Class C Purchasers or for its own account, as the case may be. Unless otherwise directed by the Administrative Agent, all payments to it shall be made by federal wire to the Administrative Agent, at its account (account number 104636460008; and account name - TTI) maintained at DBNY (ABA #026-003-780), reference FCNB Credit Card Master Note Trust Series 2001-A, with telephone notice (including federal wire number) to the Structured Finance Department of the Administrative Agent (212- 469-4653), or such other account as the Administrative Agent may designate in writing to the Issuer. Unless otherwise directed by an Agent or Class C Purchaser, all payments to it shall be made by federal wire to the account specified on the signature pages hereto or in the Transfer Supplement by which it became a party hereto (provided, in the case of an account specified in a Transfer Supplement, that the Administrative Agent, the Seller, the Issuer, the Servicer or the Indenture Trustee, as the case may be, shall have received notice thereof). 9.3 No Waiver; Cumulative Remedies. No failure to exercise and no ------------------------------ delay in exercising, on the part of any party hereto, any right, remedy, power or privilege under any of the Related Documents shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege under any of the Related Documents preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges provided in the Related Documents are cumulative and not exclusive of any rights, remedies, powers and privileges provided by law. 9.4 Successors and Assigns. This Agreement shall be binding upon ---------------------- and inure to the benefit of the Issuer, the Seller, the Servicer, the Administrative Agent, the Class C Purchasers, any Transferee and their respective successors and permitted assigns, and, to the extent provided herein, to each Indemnitee, Participant and Support Party and their respective successors and assigns; provided that, except as provided in Section 9.5, the -------- Issuer, the Seller and the Servicer may not assign or transfer any of their respective rights or obligations under this Agreement without the prior written consent of the Required Class C Owners; provided, further, that (i) in -------- ------- connection with any such assignment the assignee shall expressly agree in writing to assume all the obligations of the Issuer, the Seller or the Servicer, as applicable, hereunder and (ii) no such assignment made without the prior written consent of the Required Class C Owners shall relieve the Issuer, the Seller or the Servicer, as applicable, of any of its obligations hereunder and provided further that no assignment permitted hereunder shall relieve the - -------- ------- Issuer, the Seller or the Servicer, as applicable, from any obligations arising hereunder prior to such assignment (including obligations with respect to breaches of representations and warranties made herein). 9.5 Successors to Servicer. In the event that a transfer of ---------------------- servicing occurs under Section 7.2 of the Transfer and Servicing Agreement, (i) from and after the effective date of such transfer, the Successor Servicer shall be the successor in all respects to the Servicer and shall be responsible for the performance of all functions to be performed by the Servicer from and after such date, except as provided in the Transfer and Servicing Agreement, and shall be subject to all the responsibilities, duties and liabilities relating thereto placed on the Servicer by -41- the terms and provisions hereof, and all references in this Agreement to the Servicer shall be deemed to refer to the Successor Servicer, and (ii) as of the date of such transfer, the Successor Servicer shall be deemed to have made with respect to itself the representations and warranties made in Section 4.2 hereof (in the case of subsection 4.2(a) with appropriate factual changes); provided, -------- however, that the references to the Servicer contained in Section 5.1 of this - ------- Agreement shall be deemed to refer to the Servicer with respect to responsibilities, duties and liabilities arising out of an act or acts, or omission, or an event or events giving rise to such responsibilities, duties and liabilities and occurring during such time that the Servicer was Servicer under this Agreement and shall be deemed to refer to the Successor Servicer with respect to responsibilities, duties and liabilities arising out of an act or acts, or omission, or an event or events giving rise to such responsibilities, duties and liabilities and occurring during such time that the Successor Servicer acts as Servicer under this Agreement; provided, however, to the extent -------- ------- that an obligation to indemnify Indemnitees under Section 2.5 hereof arises as a result of any act or failure to act of any Successor Servicer in the performance of servicing obligations under the Transfer and Servicing Agreement, such indemnification obligation shall be of the Successor Servicer and not its predecessor. 9.6 Counterparts. This Agreement may be executed by one or more ------------ of the parties to this Agreement on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument. 9.7 Severability. Any provisions of this Agreement which are ------------ prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provisions in any other jurisdiction. 9.8 Integration. This Agreement, the Supplemental Spread Account ----------- Letter and the Supplemental Fee Letter represent the agreement of the Issuer, FCNB (as Seller and Servicer), the Administrative Agent and the Class C Purchasers with respect to the subject matter hereof, and there are no promises, undertakings, representations or warranties by any party hereto relative to subject matter hereof not expressly set forth or referred to herein or therein or in the Related Documents. 9.9 Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN ------------- ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO ITS CONFLICTS OF LAW PROVISIONS. 9.10 Jurisdiction; Consent to Service of Process. Each of the ------------------------------------------- parties hereto hereby irrevocably and unconditionally (i) submits, for itself and its property, to the nonexclusive jurisdiction of any New York State court in New York County or federal court of the United States of America for the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Agreement, or for recognition or enforcement of any judgment arising out of or relating to this Agreement; (ii) agrees that all claims in respect of any such action or proceeding may be heard and determined in -42- such New York State or, to the extent permitted by law, federal court; (iii) agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law; (iv) consents that any such action or proceeding may be brought in such courts and waives any objection it may now or hereafter have to the laying of venue of any such action or proceeding in any such court and any objection it may now or hereafter have that such action or proceeding was brought in an inconvenient court, and agrees not to plead or claim the same; (v) consents to service of process in the manner provided for notices in Section 9.2 of this Agreement (provided that, nothing in this -------- ---- Indenture shall affect the right of any such party to serve process in any other manner permitted by law); and (vi) waives, to the maximum extent not prohibited by law, any right it may have to claim or recover in any such action or proceeding any special, exemplary, punitive or consequential damages. 9.11 Termination. This Agreement shall remain in full force and ----------- effect until the earlier to occur of (a) payment in full of the Class C Note Principal Balance and all other amounts payable to the Class C Purchasers and the Administrative Agent hereunder and the termination of all Commitments and (b) the Series 2001-A Final Maturity Date; provided, that the provisions of -------- Sections 2.3, 2.4, 2.5, 6.1, 6.2, 7.7, 8.2, 9.10, 9.12 and 9.14 shall survive termination of this Agreement and any amounts payable to the Administrative Agent, Class C Purchasers or any Affected Party thereunder shall remain payable thereto. 9.12 Limited Recourse; No Proceedings. -------------------------------- (a) The obligations of the Issuer and FCNB under this Agreement or any other agreement, instrument, document or certificate executed and delivered or issued by the Issuer in connection herewith are solely the corporate obligations of the Issuer and FCNB . Except as expressly provided for in the Trust Agreement, no recourse shall be had for the payment of any fee or any other obligations or claim arising out of or based upon this Agreement or any other agreement, instrument, document or certificate executed and delivered or issued by the Issuer or FCNB in connection herewith against any holder of a Trust Certificate, employee, officer, director, incorporator, agent or trustee of the Issuer, FCNB or any Affiliate of the Issuer or FCNB. (b) It is expressly understood and agreed by the parties hereto that (i) this Agreement is executed and delivered by Bankers Trust Company, not individually or personally but solely as the Owner Trustee of the Issuer under the Trust Agreement, in the exercise of the powers and authority conferred and vested in it, (ii) each of the representations, undertakings and agreements herein made on the part of the Issuer is made and intended not as personal representations, undertakings and agreements by Bankers Trust Company but is made and intended for the purpose of binding only the Issuer, (iii) nothing herein contained shall be construed as creating any liability on Bankers Trust Company, individually or personally, to perform any covenant either expressed or implied contained herein, all such liability, if any, being expressly waived by the parties hereto and by any Person claiming by, through or under the such parties and (iv) under no circumstances shall Bankers Trust Company be personally liable for the payment of any indebtedness or expenses of the Issuer or be liable for the breach or -43- failure of any obligation, representation, warranty or covenant made or undertaken by the Issuer under this Indenture or the other Transaction Documents. (c) The Administrative Agent and each Class C Purchaser covenants and agrees that it shall not institute against, or join any other Person in instituting against, the Issuer any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or other similar proceeding under the laws of the United States or any state of the United States. (d) Each of the Issuer, the Seller, the Servicer, the Administrative Agent, and each Class C Purchaser hereby agrees that it shall not institute or join against any CP Conduit any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or other proceeding under any federal or state bankruptcy or similar law, for one year and a day after the latest maturing commercial paper note, medium term note or other debt security issued by such CP Conduit is paid. 9.13 Survival of Representations and Warranties. All ------------------------------------------ representations and warranties made hereunder and in any document, certificate or statement delivered pursuant hereto or in connection herewith shall survive the execution and delivery of this Agreement, the purchase of the Class C Notes hereunder and the termination of this Agreement. 9.14 Waiver of Jury Trial. EACH OF THE ISSUER, THE SELLER, THE -------------------- SERVICER, THE ADMINISTRATIVE AGENT, AND THE CLASS C PURCHASERS HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY AND ALL RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED ON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS AGREEMENT, THE CLASS C NOTEHOLDERS' INTEREST OR ANY OTHER DOCUMENTS AND INSTRUMENTS EXECUTED IN CONNECTION HEREWITH, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN), OR ACTIONS OF THE ISSUER, THE SELLER, THE SERVICER, THE ADMINISTRATIVE AGENT, AND THE CLASS C PURCHASERS. THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE PARTIES ENTERING INTO THIS AGREEMENT AND FOR CLASS C PURCHASERS PURCHASING AN INTEREST IN THE CLASS C NOTEHOLDERS' INTEREST DESCRIBED HEREIN AND THE ADMINISTRATIVE AGENT AGREEING TO ACT AS SUCH HEREUNDER. [Remainder of page intentionally left blank.] -44- IN WITNESS WHEREOF, the parties hereto have caused this Class C Note Purchase Agreement to be duly executed by their respective officers as of the day and year first above written. FIRST CONSUMERS CREDIT CARD MASTER NOTE TRUST By: Bankers Trust Company, not in its individual capacity but solely as Owner Trustee under the Trust Agreement dated as of March 1, 2001 By: /s/ Eileen M. Hughes -------------------- Name: Eileen M. Hughes Title: Vice President FIRST CONSUMERS NATIONAL BANK, as Seller and Servicer By: /s/ John R. Steele ------------------- Name: John R. Steele Title: Treasurer DEUTSCHE BANK AG, NEW YORK BRANCH, as Administrative Agent By: /s/ Adam Cohen --------------- Name: Adam Cohen Title: Director By: /s/ Thomas M. Meier ------------------- Name: Thomas M. Meier Title: Directdor -45- Address for Notices: 31 West 52nd Street New York, New York 10019 Attention: Structured Finance Department/Securitization Facsimile No.: (212) 469-7185 TWIN TOWERS INC., as Class C Purchaser Commitment: $36,000,000 By: /s/ Rosa Olivery ---------------- Name: Rosa Olivery Title: Vice President Address for Notices and Investing Office: P.O. Box 4024 Boston, Massachusetts 02101 Attention: R. Douglas Donaldson Facsimile No.: (617) 951-7050 Payment Instructions: Deutsche Bank AG, New York Branch Account number 104636460008 Account name - TTI ABA #026-003-780) Reference FCNB Master Note Business Trust Series 2001- A Telephone notice (including federal wire number) to the Structured Finance Department (212-469-4653) -46- EXHIBIT B --------- FORM OF INVESTMENT LETTER ------------------------- [Date] First Consumers Credit Card Master Note Trust c/o Bankers Trust Company, as Owner Trustee Four Albany Street, 10/th/ Floor New York, NY 10006 Attention: Corporate Trust and Agency Services [Name and address of Administrative Agent] Re First Consumers Credit Card Master Note Trust Class C Series 2001-A Floating Rate Asset Backed Notes ------------------------------------------------------ Ladies and Gentlemen: This letter (the "Investment Letter") is delivered by the undersigned (the "Purchaser") pursuant to subsection 8.1(a) of the Class C Note Purchase Agreement dated as of March 6, 2001 (as in effect, the "Note Purchase Agreement"), among First Consumers Credit Card Master Note Trust, First Consumers National Bank, the Class C Purchasers parties thereto and Deutsche Bank AG, New York Branch, as Administrative Agent. Capitalized terms used herein without definition shall have the meanings set forth in the Note Purchase Agreement. The Purchaser represents to and agrees with the Issuer as follows: (a) The Purchaser is authorized [to enter into the Note Purchase Agreement and to perform its obligations thereunder and to consummate the transactions contemplated thereby] [to purchase a participation in obligations under the Note Purchase Agreement]. (b) The Purchaser has such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of its investment in the Class C Notes and is able to bear the economic risk of such investment. The Purchaser has been afforded the opportunity to ask such questions as it deems necessary to make an investment decision, and has received all information it has requested in connection with making such investment decision. The Purchaser has, independently and without reliance upon the Administrative Agent or any other Class C Purchaser, and based on such documents and information as it has deemed appropriate, made its own appraisal of and investigation into the business, operations, property, financial and other condition and creditworthiness of the Accounts, the Receivables, First Consumers Master Trust, the Collateral Certificate, the Issuer, the Seller, the Servicer, and the Indenture Trustee and made its own decision to purchase its interest in the Class C Notes, and will, -1- independently and without reliance upon the Administrative Agent or any other Class C Purchaser, and based on such documents and information as it shall deem appropriate at the time, continue to make its own analysis, appraisals and decisions in taking or not taking action under the Note Purchase Agreement, and to make such investigation as it deems necessary to inform itself as to the business, operations, property, financial and other condition and creditworthiness of the Accounts, the Receivables, First Consumers Master Trust, the Collateral Certificate, the Issuer, the Seller, the Servicer and the Indenture Trustee. (c) The Purchaser is an "accredited investor", as defined in Rule 501, promulgated by the Securities and Exchange Commission (the "Commission") under the Securities Act of 1933, as amended (the "Securities Act"), or is a sophisticated institutional investor. The Purchaser understands that the offering and sale of the Class C Notes has not been and will not be registered under the Securities Act and has not and will not be registered or qualified under any applicable "Blue Sky" law, and that the offering and sale of the Class C Notes has not been reviewed by, passed on or submitted to any federal or state agency or commission, securities exchange or other regulatory body. (d) The Purchaser is acquiring an interest in Class C Notes without a view to any distribution, resale or other transfer thereof except, with respect to any Class C Purchaser Interest or any interest or participation therein, as contemplated in the following sentence. The Purchaser will not resell or otherwise transfer any interest or participation in the Class C Purchaser Interest, except in accordance with Section 8.1 of the Note Purchase Agreement and (i) in a transaction exempt from the registration requirements of the Securities Act of 1933, as amended, and applicable state securities or "blue sky" laws; (ii) to the Issuer or any affiliate of the Issuer; or (iii) to a person who the Purchaser reasonably believes is a qualified institutional buyer (within the meaning thereof in Rule 144A under the Securities Act) that is aware that the resale or other transfer is being made in reliance upon Rule 144A. In connection therewith, the Purchaser hereby agrees that it will not resell or otherwise transfer the Class C Notes or any interest therein unless the purchaser thereof provides to the addressee hereof a letter substantially in the form hereof. (e) The Purchaser agrees (for the benefit of the Administrative Agent, the Issuer, the Indenture Trustee, the Seller, the servicer and the Class C Noteholders) to provide those forms required to be provided by subsections 2.4(c) of the Note Purchase Agreement at the time and in the manner described therein, and to comply with all applicable U.S. laws and regulations with regard to the related withholding tax exemptions. The Purchaser further certifies, represents and warrants that unless the Seller has otherwise consented, as of the date hereof, the Purchaser is entitled to receive payments under the Note Purchase Agreement and with respect to the Class C Notes without deduction of withholding of any United States federal income taxes and it is entitled to an exemption from United States backup withholding tax. -2- (f) This Investment Letter has been duly executed and delivered and constitutes the legal, valid and binding obligation of the Purchaser, enforceable against the Purchaser in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws or equitable principles affecting the enforcement of creditors' rights generally and general principles of equity. Very truly yours, [NAME OF PURCHASER] By:___________________ Name: Title: cc: First Consumers National Bank, as Administrator -3- EXHIBIT C --------- FORM OF CONFIDENTIALITY AGREEMENT [date] [Name and address] Attention: Ladies and Gentlemen: First Consumers National Bank (the "Company") will be providing information to you in connection with a transaction (the "Transaction") to which the Company will be a party; and in connection therewith you have requested that the Company furnish or otherwise make available to you certain information concerning the Company. As a condition to our furnishing such information to you, we are requiring that you agree, as set forth below, to treat confidentially such information and any other information that the Company, its agents or its representatives (including attorneys and financial advisors) furnishes to you or your partners, officers, directors, employees, attorneys, accountants, agents, advisors, affiliates or representatives of your agents or advisors (all of the foregoing collectively referred to as "your Representatives"), whether furnished before or after the date of this Agreement, and all notes, analyses, compilations, studies or other documents, whether prepared by you or others, which contain, is derived from, or otherwise reflect such information (all of such information collectively referred to as the "Confidential Information"). The term "Confidential Information" does not include information which (i) becomes generally available to the public other than as a result of a disclosure by you or your Representatives, or (ii) was available to you on a non-confidential basis prior to its disclosure to you by the Company, its representatives or its agents, or (iii) becomes available to you on a non-confidential basis from a source other than the Company, its representatives or its agents, provided that such source is not bound by a confidentiality agreement with the Company or otherwise prohibited from transmitting the information to you or your Representatives by a contractual, legal or fiduciary obligation, or (iv) has been independently developed by you without use of any information furnished by the Company. It is understood that you may disclose any of the Confidential Information to those of your Representatives who require such material for the purpose of evaluating, or providing advice to you with respect to the Transaction and the defense, protection and enforcement of your rights and remedies in the agreements related to the Transaction and otherwise as provided by law (provided that such Representatives shall be informed by you of the confidential nature of -1- the Confidential Information). You agree that the Confidential Information will be kept confidential by you and your Representatives and, except with the specific prior written consent of the Company or as expressly otherwise permitted by the terms hereof, will not be disclosed by you or your Representatives, except to any person which has executed a confidentiality agreement in form and substance similar to this Agreement (and to the Representatives of such person). You further agree that you and your Representatives will not use any of the Confidential Information for any reason or purpose other than to evaluate the Transaction and to defend, protect and enforce your rights and remedies thereunder. The obligations of confidentiality and nondisclosure contained herein shall not apply to the extent disclosure of the Confidential Information is required by law or is requested by any regulatory authority or, solely with respect to any Transaction documents, any rating agency; provided, however, in any case in which the disclosure is so required or requested, you shall disclose only that portion of the Confidential Information required or requested to be disclosed. The term "person" as used in this Agreement shall be broadly interpreted to include without limitation any corporation, company, partnership and individual. The obligations of confidentiality and nondisclosure contained herein shall not apply in the event that you or any of your Representations are requested or required (by oral questions, interrogatories, requests for information or documents, subpoena, civil investigative demand or similar process) to disclose any of the Confidential Information, provided it is agreed that you or such Representative, as the case may be, will provide the Company with notice of such request for disclosure as may be legally permissible and reasonably practicable under the circumstances so that the Company may seek an appropriate protective order or other appropriate remedy and/or waive your or such Representative's compliance with the provisions of this Agreement. In the event that such protective order or other remedy is not obtained, or that the Company grants a waiver hereunder, you or such Representative may furnish that portion (and only that portion) of the Confidential Information which you are legally compelled to disclose or which has been waived; provided, however, you may disclose any Confidential Information under circumstances where you reasonably believe that the failure to disclose such information could have a material adverse effect on your business or condition (financial or otherwise). Although you understand that the Company has endeavored to include in the Confidential Information known to it which it believes to be relevant for the purpose of the Transaction, you further understand that neither the Company nor its agents or its representatives makes any representation or warranty as to the accuracy or completeness of the Confidential Information except such as is made to you or your affiliates in definitive written documentation related to the Transaction, subject to such limitations and restrictions as may be specified therein. You agree that neither the Company nor its agents or its representatives shall have any liability to you or any of your Representatives resulting from the use of the Confidential Information by you or such Representatives other than in connection with such documentation. The agreements set forth in this Agreement may be modified or waived only by a separate writing signed by the Company and you expressly so modifying or waiving such agreements. -2- You hereby agree to be responsible for any damage, loss, cost or liability directly arising out of a breach by you or your Representatives of this Agreement. You also acknowledge that money damages would be both incalculable and an insufficient remedy for any breach of this Agreement by you or your Representatives and that any such breach would cause the Company irreparable harm. Accordingly, you also agree that in the event of any breach or threatened breach of this Agreement, the Company, in addition to any other remedies at law or in equity it may have, shall be entitled, without the requirement of posting a bond or other security, to equitable relief, including injunctive relief and specific performance. It is understood and agreed that no failure or delay by the Company in exercising any right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any right, power or privilege hereunder. The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provisions of this Agreement, which shall remain in full force and effect. This Agreement and the rights and obligations of the parties set forth herein shall be governed by the laws of the State of New York. [Applicable to CP Conduit: The Company hereby agrees that it shall not institute or join against any you any bankruptcy, reorganization, arrangement, insolvency or liquidation proceeding, or other proceeding under any federal or state bankruptcy or similar law, for one year and a day after the latest maturing commercial paper note, medium term note or other debt security issued by you is paid. The Company further agrees that any of your monetary obligations arising under this letter are payable only to the extent you have excess funds available for the payment thereof after repayment of your commercial paper notes, liquidity loans and other senior debt, and otherwise shall not constitute a "claim" (as defined in Section 101(5) of the Bankruptcy Code) against you. No recourse shall be had for the payment of any amount owing hereunder or any other obligation of, or claim against, you arising out of or based upon this letter, against any of your stockholders, employees, officers, agents, directors or incorporators or any affiliate thereof.] If you are in agreement with the foregoing, please sign and return one copy of this Agreement, which thereupon will constitute our agreement with respect to the subject matter hereof. Very truly yours, FIRST CONSUMERS NATIONAL BANK By: _________________________ Name: Title: -3- Confirmed and agreed to as of the date first above written: [_____________________________] By: __________________ Name: Title: -4- EXHIBIT D --------- FORM OF TRANSFER SUPPLEMENT TRANSFER SUPPLEMENT, dated as of the date set forth in Item 1 of Schedule I hereto, between the Seller Class C Purchaser set forth in Item 2 of ------------------------ Schedule I hereto (the "Seller Class C Purchaser"), and the Purchasing Class C Purchaser set forth in Item 3 of Schedule I hereto (the "Purchasing Class C ------------------ Purchaser"). - --------- W I T N E S S E T H: WHEREAS, this Supplement is being executed and delivered in accordance with subsection 8.1(e) of the Class C Note Purchase Agreement, dated as of March 6, 2001, among First Consumers Credit Card Master Note Trust, First Consumers National Bank, the Class C Purchasers parties thereto and Deutsche Bank AG, New York Branch, as Administrative Agent (as from time to time amended, supplemented or otherwise modified in accordance with the terms thereof, the "Note Purchase ------------- Agreement"; unless otherwise defined herein, terms defined in the Note Purchase - --------- Agreement are used herein as therein defined); WHEREAS, the Purchasing Class C Purchaser (if it is not already a Class C Purchaser party to the Note Purchase Agreement) wishes to become a Class C Purchaser party to the Note Purchase Agreement and the Purchasing Class C Purchaser wishes to acquire and assume from the Seller Class C Purchaser, certain of the rights, obligations and commitments under the Note Purchase Agreement; and WHEREAS, the Seller Class C Purchaser wishes to sell and assign to the Purchasing Class C Purchaser, certain of its rights and obligations under the Note Purchase Agreement. NOW, THEREFORE, the parties hereto hereby agree as follows: (a) Upon receipt by the Administrative Agent of five counterparts of this Supplement, to each of which is attached a fully completed Schedule I and Schedule II, each of which has been executed by the Seller Class C Purchaser, the Purchasing Class C Purchaser and the Administrative Agent, the Administrative Agent will transmit to the Servicer, the Issuer, the Seller, the Indenture Trustee, the Seller Class C Purchaser and the Purchasing Class C Purchaser a Transfer Effective Notice, substantially in the form of Schedule III to this Supplement (a "Transfer Effective Notice"). Such Transfer Effective ------------------------- Notice shall be executed by the Administrative Agent and shall set forth, inter ----- alia, the date on which the transfer effected by this Supplement shall become - ---- effective (the "Transfer Effective Date"). From and after the Transfer Effective ----------------------- Date the Purchasing Class C Purchaser shall be a Class C Purchaser party to the Note Purchase Agreement for all purposes. (b) At or before 12:00 Noon, local time of the Seller Class C Purchaser, on the Transfer Effective Date, the Purchasing Class C Purchaser shall pay to the Seller Class C Purchaser, in immediately available funds, an amount equal to the purchase price, as agreed between the Seller Class C Purchaser and such Purchasing Class C Purchaser (the "Purchase Price"), of the -------------- portion set forth on Schedule II hereto being purchased by such Purchasing Class C Purchaser of the outstanding Class C Note Principal Balance under the Class C Note owned by the Seller Class C Purchaser (such Purchasing Class C Purchaser's "Purchaser Percentage") and other amounts owing to the Seller Class C Purchaser -------------------- under the Note Purchase Agreement or otherwise in respect of the Class C Notes. Effective upon receipt by the Seller Class C Purchaser of the Purchase Price from the Purchasing Class C Purchaser, the Seller Class C Purchaser hereby irrevocably sells, assigns and transfers to the Purchasing Class C Purchaser, without recourse, representation or warranty, and the Purchasing Class C Purchaser hereby irrevocably purchases, takes and assumes from the Seller Class C Purchaser, the Purchasing Class C Purchaser's Purchaser Percentage of (i) the presently outstanding Class C Note Principal Balance under the Class C Notes owned by the Seller Class C Purchaser and other amounts owing to the Seller Class C Purchaser in respect of the Class C Notes, together with all instruments, documents and collateral security pertaining thereto, and (ii) the Purchasing Class C Purchaser's Purchaser Percentage of the Purchaser Percentage of the Seller Class C Purchaser and the other rights and duties of the Seller Class C Purchaser under the Note Purchase Agreement. This Supplement is intended by the parties hereto to effect a purchase by the Purchasing Class C Purchaser and sale by the Seller Class C Purchaser of interests in the Class C Notes, and it is not to be construed as a loan or a commitment to make a loan by the Purchasing Class C Purchaser to the Seller Class C Purchaser. The Seller Class C Purchaser hereby confirms that the amount of the Class C Note Principal Balance is $ and its Percentage Interest thereof is ___%, which equals $_______ as of ___________, 200_. Upon and after the Transfer Effective Date (until further modified in accordance with the Note Purchase Agreement), the Purchaser Percentage of the Seller Class C Purchaser and the Purchasing Class C Purchaser shall be as set forth in Schedule II to this Supplement. (c) The Seller Class C Purchaser has made arrangements with the Purchasing Class C Purchaser with respect to (i) the portion, if any, to be paid, and the date or dates for payment, by the Seller Class C Purchaser to the Purchasing Class C Purchaser of any fees heretofore received by the Seller Class C Purchaser pursuant to the Note Purchase Agreement prior to the Transfer Effective Date and (ii) the portion, if any, to be paid, and the date or dates for payment, by the Purchasing Class C Purchaser to the Seller Class C Purchaser of fees or interest received by the Purchasing Class C Purchaser pursuant to the Note Purchase Agreement or otherwise in respect of the Class C Notes from and after the Transfer Effective Date. (d) (i) All principal payments that would otherwise be payable from and after the Transfer Effective Date to or for the account of the Seller Class C Purchaser in respect of the Class C Notes shall, instead, be payable to or for the account of the Seller Class C Purchaser and the Purchasing Class C Purchaser, as the case may be, in accordance with their respective interests as reflected in this Supplement. -2- (ii) All interest, fees and other amounts that would otherwise accrue for the account of the Seller Class C Purchaser from and after the Transfer Effective Date pursuant to the Note Purchase Agreement or in respect of the Class C Notes shall, instead, accrue for the account of, and be payable to or for the account of, the Seller Class C Purchaser and the Purchasing Class C Purchaser, as the case may be, in accordance with their respective interests as reflected in this Supplement. In the event that any amount of interest, fees or other amounts accruing prior to the Transfer Effective Date was included in the Purchase Price paid by the Purchasing Class C Purchaser, the Seller Class C Purchaser and the Purchasing Class C Purchaser will make appropriate arrangements for payment by the Seller Class C Purchaser to the Purchasing Class C Purchaser of such amount upon receipt thereof from the Administrative Agent. (e) Concurrently with the execution and delivery hereof, the Purchasing Class C Purchaser will deliver to the Administrative Agent and the Issuer an executed Investment Letter in the form of Exhibit A to the Note Purchase Agreement and the forms, if any, required by subsection 2.4(c) of the Note Purchase Agreement. (f) Each of the parties to this Supplement agrees and acknowledges that (i) at any time and from time to time upon the written request of any other party, it will execute and deliver such further documents and do such further acts and things as such other party may reasonably request in order to effect the purposes of this Supplement, and (ii) the Administrative Agent shall apply each payment made to it under the Note Purchase Agreement, whether in its individual capacity or as Administrative Agent, in accordance with the provisions of the Note Purchase Agreement, as appropriate. (g) By executing and delivering this Supplement, the Seller Class C Purchaser and the Purchasing Class C Purchaser confirm to and agree with each other, the Administrative Agent and the Class C Purchasers as follows: (i) other than the representation and warranty that it is the legal and beneficial owner of the interest being assigned hereby free and clear of any adverse claim, the Seller Class C Purchaser makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Note Purchase Agreement or the Related Documents or the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Note Purchase Agreement or any other instrument or document furnished pursuant thereto; (ii) the Seller Class C Purchaser makes no representation or warranty and assumes no responsibility with respect to the Trust, the financial condition of the Receivables, the Accounts, First Consumers Master Trust, the Collateral Certificate, the Issuer, FCNB or the Indenture Trustee, or the performance or observance by the Issuer, FCNB or the Indenture Trustee of any of their respective obligations under the Note Purchase Agreement or any Related Document or any other instrument or document furnished pursuant hereto; (iii) each Purchasing Class C Purchaser confirms that it has received a copy of such documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Supplement; (iv) each Purchasing Class C Purchaser will, independently and without reliance upon the Administrative Agent, the Seller Class C Purchaser or any other Class C Purchaser and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not -3- taking action under the Note Purchase Agreement or the Related Documents; (v) the Purchasing Class C Purchaser appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers under the Note Purchase Agreement and the Related Documents as are delegated to the Administrative Agent by the terms thereof, together with such powers as are reasonably incidental thereto, all in accordance with Section 7 of the Note Purchase Agreement; and (vi) each Purchasing Class C Purchaser agrees (for the benefit of the Seller Class C Purchaser, the Administrative Agent, the Class C Purchasers, the Indenture Trustee, the Servicer, the Seller and the Issuer) that it will perform in accordance with their terms all of the obligations which by the terms of the Note Purchase Agreement are required to be performed by it as a Class C Purchaser. (h) Schedule II hereto sets forth the revised Purchaser Percentage of the Seller Class C Purchaser and the Purchaser Percentage of the Purchasing Class C Purchaser, as applicable, and the initial Investing Office of the Purchasing Class C Purchaser, as well as administrative information with respect to the Purchasing Class C Purchaser. (i) THIS SUPPLEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. IN WITNESS WHEREOF, the parties hereto have caused this Supplement to be executed by their respective duly authorized officers on Schedule I hereto as of the date set forth in Item 1 of Schedule I hereto. -4- SCHEDULE I TO TRANSFER SUPPLEMENT ------------------- COMPLETION OF INFORMATION AND SIGNATURES FOR TRANSFER SUPPLEMENT Re: Class C Note Purchase Agreement, dated as of March 6, 2001, among First Consumers Credit Card Master Note Trust, First Consumers National Bank, the Class C Purchasers parties thereto and Deutsche Bank AG, New York Branch, as Administrative Agent Item 1: Date of Transfer Supplement: Item 2: Seller Class C Purchaser: Item 3: Purchasing Class C Purchaser: Item 4: Signatures of Parties to Agreement: ___________________________________ as Seller Class C Purchaser By:________________________________ Name: Title: By:________________________________ Name: Title: as Purchasing Class C Purchaser By:________________________________ Name: Title: By:________________________________ Name: Title: CONSENTED TO AND ACCEPTED BY: -1- [If applicable:] DEUTSCHE BANK AG, NEW YORK BRANCH, as Administrative Agent By:________________________ Name: Title: By:________________________ Name: Title: -2- SCHEDULE II TO TRANSFER SUPPLEMENT ------------------- LIST OF INVESTING OFFICES, ADDRESSES FOR NOTICES, ASSIGNED INTERESTS AND PURCHASE AND COMMITMENT PERCENTAGES ----------------------------------- [Seller Class C Purchaser] A. Type of Purchaser: CP Conduit: Yes/No B. Purchaser Percentage: Seller Class C Purchaser Purchaser Percentage Prior to Sale: _____% Purchaser Percentage Sold: _____% Purchaser Percentage Retained: _____% C. Class C Note Principal Balance: ------------------------------ Seller Class C Purchaser Class C Note Principal Balance Prior to Sale: $________ Class C Note Principal Balance Sold: $________ Class C Note Principal Balance Retained: $________ [Purchasing Class C Purchaser] ---------------------------- A. Type of Purchaser: CP Conduit: Yes/No ------ B. Purchaser Percentage: -------------------- Transferee Class C Purchaser Purchaser Percentage After Sale: _____% C. Class C Note Principal Balance: ------------------------------ Transferee Class C Purchaser Class C Note Principal Balance After Sale: $________ Address for Notices: - ------------------- Investing Office: - ---------------- - 1 - SCHEDULE III TO TRANSFER SUPPLEMENT ------------------- Form of Transfer Effective Notice ------------------------- To: [Name and address of Issuer, Seller, Servicer, Indenture Trustee, Administrative Agent, Seller Class C Purchaser and Purchasing Class C Purchaser] The undersigned, as Administrative Agent under the Class C Note Purchase Agreement, dated as of March 6, 2001, among First Consumers Credit Card Master Note Trust, First Consumers National Bank, the Class C Purchasers and Deutsche Bank AG, New York Branch, as Administrative Agent, acknowledges receipt of five executed counterparts of a completed Transfer Supplement. [Note: attach copies of Schedules I and II from such Agreement.] Terms defined in such Supplement are used herein as therein defined. Pursuant to such Supplement, you are advised that the Transfer Effective Date will be ____________, ____. Very truly yours, [NAME OF AGENT], as Administrative Agent By:_____________________________ Name: Title: By:_____________________________ Name: Title: -1- Table of Contents ----------------- Page ---- i -----END PRIVACY-ENHANCED MESSAGE-----