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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark One)
/X/ Annual Report pursuant to section 13 or 15(d) of the Securities Exchange Act
of 1934 for the fiscal year ended December 31, 1997 or
/ / Transition report pursuant to section 13 or 15(d) of the Securities Exchange
Act of 1934 for the transition period from ____________ to __________________.
Commission file number: 000-22781
Exact name of Registrant as specified in its charter:
FIRST BANK CORPORATE CARD MASTER TRUST
State or other jurisdiction of incorporation or organization: Delaware
I.R.S. Employer Identification No.: 41-1881896
Address of principal executive offices:
4325 17th Avenue S.W.
Fargo, North Dakota 58103
Registrant's telephone number, including area code: (701) 461-3468
Securities registered pursuant to Section 12(b) of the Act: None
Securities registered pursuant to Section 12(g) of the Act:
Asset Backed Certificates, Series 1997-1, issued by First Bank Corporate
Card Master Trust
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
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Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K is not contained herein, and will not be contained,
to the best of Registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K. /X/
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PART I
Item 1. BUSINESS.
The sole business of First Bank Corporate Card Master Trust (the
"Trust") is to hold the Receivables and to apply the proceeds thereof
to make payments to the Certificateholders, as described in the
Trust's Registration Statement on Form S-1 (File No. 333-01837).
Item 2. PROPERTIES.
Not applicable.
Item 3. LEGAL PROCEEDINGS.
Not applicable.
Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
Not applicable.
PART II
Item 5. MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.
As of December 31, 1997, the Trust had three holders of record
of the Series 1997-1 Certificates, computed in accordance with Rule
12g5-1 under the Securities Exchange Act of 1934, as amended.
Item 6. SELECTED FINANCIAL DATA.
Not applicable.
Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATION.
Not applicable.
Item 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Not applicable.
Item 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
Not applicable.
Item 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
FINANCIAL DISCLOSURE.
Not applicable.
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PART III
Item 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
Not applicable.
Item 11. EXECUTIVE COMPENSATION.
Not applicable.
Item 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
Not applicable.
Item 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
Not applicable.
PART IV
Item 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K.
(a) The Independent Accountants' Servicing Report, delivered pursuant
to Section 3.6 of the Pooling and Servicing Agreement dated as of
February 1, 1997, among U.S. Bank National Association ND (formerly
First Bank of South Dakota (National Association)), as Transferor,
FBS Card Services, Inc., as Servicer, and Citibank, N.A., as Trustee,
is filed herewith.
(b) None.
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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 BANK CORPORATE
CARD MASTER TRUST
By U.S. Bank National Association ND
as Originator
Dated: May 28, 1998 By: /s/ David P. Grandstrand
-------------------------------------
David P. Grandstrand
Senior Vice President
and Treasurer
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EXHIBIT INDEX
ITEM
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99.1 The Independent Accountants' Servicing Report, delivered pursuant
to Section 3.6 of the Pooling and Servicing Agreement dated as of
February 1, 1997, among U.S. Bank National Association ND
(formerly First Bank of South Dakota (National Association)), as
Transferor, FBS Card Services, Inc., as Servicer, and Citibank,
N.A., as Trustee, is filed herewith.
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[LETTERHEAD]
Report of Independent Accountants on Applying Agreed-Upon Procedures
U.S. Bancorp
We have performed the procedures enumerated below, which were agreed to by U.S.
Bank National Association ND (formerly First Bank of South Dakota), the
Transferor, and FBS Card Services, Inc., the Servicer, wholly-owned subsidiaries
of U.S. Bancorp (collectively known as the "Companies"), pursuant to the Pooling
and Servicing Agreement dated February 1, 1997 and the Supplement dated February
27, 1997 (the "PSA"), solely to assist you with respect to the First Bank
Corporate Card Master Trust Series 1997-1 (the "Trust") and compliance with the
PSA. This engagement to apply agreed-upon procedures was performed in accordance
with standards established by the American Institute of Certified Public
Accountants. The sufficiency of the procedures is solely the responsibility of
the specified users of the report. Consequently, we make no representation
regarding the sufficiency of the procedures described below either for the
purpose for which this report has been requested or any other purpose.
Our procedures, with respect to the PSA, were as follows:
SECTION 3.1 - ACCEPTANCE OF APPOINTMENT AND OTHER MATTERS RELATED TO THE
SERVICER
1. Obtained a copy of the December 31, 1997 Monthly Certificateholder
Statement (the "Statement") as evidence that FBS Card Services, Inc. is
the Servicer.
2. Obtained a copy of the State of Minnesota and the State of South Dakota
Certificates of Good Standing for FBS Card Services, Inc. dated February
19, 1997.
3. Obtained the Statements for the months of February 1997 through December
1997 and on a sample basis agreed information from ancillary systems to
the Statements. The results of these procedures are reported in a separate
letter to U.S. Bancorp and Citibank, N.A. dated April 22, 1998.
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4. Inquired of Randy Ritterman, Assistant Vice President, regarding whether
FBS Card Services, Inc. has procedures for identifying and accounting for
Ineligible Receivables, as defined by Section 2.4 (d) of the PSA, and for
payments received with respect to Ineligible Receivables, separately from
its accounting for Collections on Receivables retained by the Trust. Randy
Ritterman represented that FBS Card Services, Inc. has procedures for
identifying and accounting for Ineligible Receivables, as defined by
Section 2.4 (d) of the PSA, and for payments received with respect to
Ineligible Receivables, separately from its accounting for Collections on
Receivables retained by the Trust.
5. Obtained documentation from J.H. Marsh McLennan, U.S. Bancorp's fidelity
bond coverage provider, indicating that FBS Card Services, Inc., maintains
fidelity bond coverage to insure against losses resulting from wrongdoing
of its officers and employees servicing charge card receivables.
SECTION 3.2 - SERVICING COMPENSATION
1. Obtained the Statements for February 1997 through December 1997 and
recalculated FBS Card Services, Inc.'s servicing fee to be an amount equal
to 1/12 of the product of the series servicing fee rate (1%) by the
servicing base amount, and the first month's servicing fee is reduced to
reflect only the number of days in the month from closing through the day
preceding the initial distribution date, and the servicing fees are
equally allocated between certificates.
SECTION 3.3 - REPRESENTATIONS AND WARRANTIES OF THE SERVICER
1. Obtained the State of Minnesota and South Dakota Certificates of Good
Standing) from Randy Ritterman, U.S. Bancorp Assistant Vice President,
indicating FBS Card Services, Inc., is duly incorporated and in good
standing under Minnesota laws, and has full corporate power, authority
and legal right to its own properties and conduct its charge card
business and to execute, deliver and perform its obligations under the
PSA.
2. Inquired of Randy Ritterman, Assistant Vice President, whether FBS Card
Services, Inc. has obtained all licenses and approvals necessary to
service the Receivables as required under federal and Minnesota law. Randy
Ritterman represented that FBS Card Services, Inc. has obtained the above
referenced licenses and approvals necessary to service the Receivables as
required under federal and Minnesota law.
3. Compared the names of the signers (Donald Jacobson and Randy Ritterman) on
the Statements to the Board of Directors' resolutions indicating that the
signers' Statements are authorized to act on behalf of the Companies.
4. Inquired of Randy Ritterman, Assistant Vice President, regarding whether
to the best of his knowledge, there are no proceedings or investigations
pending related to
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the servicing of Trust Receivables, as defined in Section 1.1 of the PSA.
Randy Ritterman represented that there are no proceedings or
investigations pending related to the servicing of Trust Receivables, as
defined in Section 1.1 of the PSA.
5. Inquired of Randy Ritterman, Assistant Vice President, regarding whether
to the best of his knowledge, FBS Card Services, Inc. has not permitted
any rescission or cancellation of any Receivable, as defined in Section
1.1 of the PSA, except as ordered by a court of competent jurisdiction or
other Governmental Authority. Randy Ritterman represented that FBS Card
Services, Inc. has not permitted any rescission or cancellation of any
Receivable, as defined in Section 1.1 of the PSA, except as ordered by a
court of competent jurisdiction or other Governmental Authority.
6. Inquired of Randy Ritterman, Assistant Vice President, regarding whether
to the best of his knowledge, all approvals, authorizations, consents,
orders, or other actions of any person or Governmental Authority required
in connection with the execution and delivery of the PSA by FBS Card
Services, Inc. were complete. Randy Ritterman represented that all
approvals, authorizations, consents, orders, or other actions of any
person or Governmental Authority required in connection with the execution
and delivery of the PSA by FBS Card Services, Inc. were complete.
7. Inquired of Randy Ritterman, Assistant Vice President, regarding whether
to the best of his knowledge, each Receivable, as defined in Section 1.1
of the PSA, is payable pursuant to a contract which does not create a lien
on any merchandise purchased thereunder. Randy Ritterman represented that
each Receivable, as defined in Section 1.1 of the PSA, is payable pursuant
to a contract which does not create a lien on any merchandise purchased
thereunder.
SECTION 3.4 - REPORTS AND RECORDS FOR THE TRUSTEE
1. Inquired of Randy Ritterman, Assistant Vice President, whether upon
reasonable prior notice he can prepare, using the Daily Total System
Management Reports, and make available for inspection by the Trustee a
record setting forth:
(a) the aggregate amount of Collections, all payments paid by corporate
clients as obligors under the Corporate Card Agreement, processed by
the Servicer on the preceding Business day, and
(b) the aggregate amount of Receivables, as defined in Section 1.1 of the
PSA, as of the close of business on the preceding Business Day.
Randy Ritterman represented that upon reasonable prior notice he can
prepare, using the Daily Total System Management Reports, and make
available for inspection by the Trustee a record setting forth the above
referenced information.
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2. Inquired of Randy Ritterman, Assistant Vice President, procedures to
provide an Officer's Certificate signed by the Servicing Officer to the
Trustee and each rating agency. Randy Ritterman represented that
procedures are in place to provide an Officer's Certificate signed by the
Servicing Officer to the Trustee and each rating agency.
SECTION 3.5 - ANNUAL SERVICER'S CERTIFICATE
1. Obtained a copy of the Annual Certificate to the Trustee, and rating
agencies for the eleven month period ending December 31, 1997.
SECTION 3.7 - TAX TREATMENT
1. Inquired of Randy Ritterman, Assistant Vice President, whether to the best
of his knowledge, the Companies have not filed a tax return or obtained an
employer identification number on behalf of the Trust. Randy Ritterman
represented that the Companies have not filed a tax return or obtained an
employer identification number on behalf of the Trust.
SECTION 3.9 - REPORTS TO THE COMMISSION
1. Obtained a copy of the February 1997 through December 1997 Statements
filed with the Securities Exchange Commission as required under the
provisions of the Securities Exchange Act of 1934 and the rules and
regulations of the Securities Exchange Commission thereunder.
SECTION 4.1 - RIGHTS OF CERTIFICATEHOLDERS
1. Obtained copies of the First Bank Corporate Card Master Trust (the
"Trust") Class A 6.40%, Asset Backed Certificates Number R-1 and R-2 and
Class B 6.55% Asset Backed Certificate Number R-1 issued February 27,
1997, evidencing that they represent an undivided interest in the Trust.
SECTION 4.2 - ESTABLISHMENT OF ACCOUNT
1. Obtained a memo from Annette Marsula, Citibank, Senior Trust Officer,
supporting the existence of the Collection and Excess Funding Accounts in
the name of Citibank, the Trustee.
2. Obtained the Interest Funding Account Statements provided to FBS Card
Services, Inc. by Citibank, indicating the amount deposited in the
Interest Funding Account for February 1997 through December 1997.
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SECTION 4.3 - COLLECTIONS AND ALLOCATIONS
1. Confirmed with Standard & Poor's and Moody's that the Transferor, U.S.
Bank National Association ND, has a certificate of deposit or commercial
paper rating of at least A-1 and P-1, respectively.
2. Recalculated whether FBS Card Services, Inc. allocated to the Holder of
the Exchangeable Transferor or Certificate an amount equal to the product
of the Transfer or Percentage and the aggregate amount of Principal
Collections and Yield Collections, respectively, in each Collection
Period.
SECTION 8.8 - EXAMINATION OF RECORDS
1. Inquired of Randy Ritterman, Assistant Vice President, whether FBS Card
Services, Inc.'s procedures clearly and unambiguously identify each
Account in its computer or other records to reflect that the Receivables
arising in the Account have been conveyed to the Trust. Randy Ritterman
represented that FBS Card Services, Inc.'s procedures clearly and
unambiguously identify each Account in its computer or other records to
reflect that the Receivables arising in the Account have been conveyed to
the Trust.
2. Inquired of Randy Ritterman, Assistant Vice President, whether, FBS Card
Services, Inc., prior to sale or transfer to a third party, examines its
computer and other records of any receivable held in custody, to determine
that such receivable is not a Receivable as defined in Section 1.1. Randy
Ritterman represented that prior to sale or transfer to a third party,
examines its computer and other records of any receivable held in custody,
to determine that such receivable is not a Receivable as defined in
Section 1.1.
We were not engaged to, and did not perform an audit, the objective which would
be the expression of an opinion on the specified elements, accounts or items
thereof. Accordingly, we do not express such an opinion. Had we performed
additional procedures, other matters might have come to our attention that would
have been reported to you.
This report is intended solely for the use of the specified users listed above
and should not be used by those who have not agreed to the procedures and taken
responsibility for the sufficiency of the procedures for their purposes.
Very truly yours,
/s/ ERNST & YOUNG LLP
April 22,1998
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[LETTERHEAD]
Independent Accountants' Report on Applying Agreed-Upon Procedures
U.S. Bancorp
Minneapolis, Minnesota
First Bank Corporate Credit Card Master Trust Series 1997-1
-----------------------------------------------------------
We have performed the procedures described below, which were agreed to by U.S.
Bank National Association ND, the Transferor (formerly First Bank of South
Dakota), and FBS Card Services, Inc., the Servicer, wholly owned subsidiaries of
U.S. Bancorp, (collectively known as the "Companies"), solely to assist you with
respect to the monthly certificateholder's statements (the "Statement") prepared
by FBS Card Services, Inc., during each of the eleven months in the
corresponding period ended December 31, 1997 pursuant to subsection 3.4 (b) of
the Pooling and Servicing Agreement dated February 1, 1997 and supplement dated
February 27, 1997 (collectively, the "Agreement"). This engagement to apply
agreed-upon procedures was performed in accordance with standards established by
the American Institute of Certified Public Accountants. The sufficiency of the
procedures is solely the responsibility of the specified users of the report.
Consequently, we make no representation regarding the sufficiency of the
procedures described below either for the purpose for which this report has
been requested or any other purpose.
We performed the procedures enumerated in the letter dated April 21, 1998 from
the Companies, included as Attachment A to this letter, to each Statement for
each of the eleven months in the corresponding period ended December 31, 1997
prepared by the Companies pursuant to subsection 3.4 (b) of the Agreement. As a
result of the procedures performed, we noted no instances where amounts set
forth in the Statements were allocated incorrectly or we were not in agreement
with the corresponding amounts in the Companies' servicing records, except as
described in Attachment B to this letter.
We were not engaged to, and did not perform an audit, the objective which would
be the expression of an opinion on the specified elements, accounts or items
thereof. Accordingly, we do not express such an opinion. Had we performed
additional
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procedures, other matters might have come to our attention that would have been
reported to you.
This report is intended solely for the use of the specified users listed above
and should not be used by those who have not agreed to the procedures and taken
responsibility for the sufficiency of the procedures for their purposes.
However, this report may be distributed to those authorized to receive such
information as specified in the Agreement.
/s/ ERNST & YOUNG LLP
April 22, 1998
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[LOGO]
601 Second Avenue South ATTACHMENT A
Minneapolis, MN 55402-4302
April 21, 1998
U.S. Bancorp
Minneapolis, MN
Subsection 3.4 (b) of the Pooling and Servicing Agreement dated February 1, 1997
and the supplement to this agreement dated February 27, 1997 (collectively, the
"Agreement") between U.S. Bank National Association ND, (formerly First Bank of
South Dakota), the Transferor, FBS Card Services, Inc., the Servicer, wholly
owned subsidiaries of U.S. Bancorp, (collectively known as the "Companies"),
states that on or before April 30 of each calendar year, the Servicer shall
cause a firm of nationally recognized independent accountants to furnish a
report to the Trustee, the Servicer, and each Rating Agency that they have
compared the mathematical calculations of certain amounts for the monthly
certificates delivered pursuant to subsection 3.4 (b) of the Agreement (the
"Statement") with the computer reports of the Servicer. For each of the eleven
months in the period ended December 31, 1997, we will perform the below
agreed-upon procedures to satisfy the requirements of subsection 3.4 (b) of the
Agreement. You are responsible for the sufficiency (nature, timing, and extent)
of the below procedures and we are responsible for carrying out the procedures
and reporting the findings in accordance with Statement on Auditing Standards
No. 75.
SERIES 1997-1
1. Obtain a copy of the Statements provided to Citibank, from Randy Ritterman,
Assistant Vice President, for each month end for the period from February
1997 through December 1997. Agree the name of the officers, Donald C.
Jacobson and Randy L. Ritterman, signing the Statements to a U.S. Bancorp
Board of Directors authorization indicating they are authorized to act on
behalf of FBS Card Services, Inc.
2. Compare the information contained in the February 1997 through December
1997 Statements to Exhibit C of the Agreement.
3. Agreed the mathematical calculations of each amount included in the
February 1997 through December 1997 Statements by comparing the amounts
listed on the Statements to the Companies computer reports which were the
source of the amounts by performing the following:
The financial organization created by the merger of First Bank System and U.S.
Bancorp.
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Page Number Procedures
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Page 1 For Item A) 1., compare the amount of the distribution to Class A
Monthly Principal for Collections processed for the Collection
Period for the Determination Date to the Payment to Class A
Certificateholders as stated on the Settlement Statement, the
spreadsheets used by FBS Card Services Inc. to summarize
information from Total System Reports, the general ledger, and
LIBOR index information, divided by the Amount of Class A Bonds
($394,800,000) for each Determination Date.
Page 1 For Item A) 2., compare the amount of the distribution to Class B
Monthly Principal for Collections processed for the Collection
Period for the Determination Date to the Payment to Class B
Certificateholders as stated on the Settlement Statement divided
by the Amount of Class B Bonds ($6,300,000) for each
Determination Date.
Page 1 For Item A) 3., compare the amount of the distribution to
Collateral Monthly Principal for Collections processed for the
Collection Period for the Determination Date to the Payment to
Collateral Certificateholders as stated on the Settlement
Statement divided by the Amount of CIA Bonds ($18,900,000) for
each Determination Date.
Page 1 For Item A) 4., compare the amount of the distribution to Class A
Monthly Interest for Collections processed for the Collection
Period for the Determination Date to the Interest Funding Account
Payment to Class A Investors as stated on the Settlement
Statement divided by the Amount of Class A Bonds ($394,800,000)
for each Determination Date.
Page 1 For Item A) 5., compare the amount of the distribution to Class A
Deficiency for Collections processed for the Collection Period
for the Determination Date to the Interest Funding Account Class
A Deficiency Amount as stated on the Settlement Statement divided
by the Amount of Class A Bonds ($394,800,000) for each
Determination Date.
Page 1 For Item A) 6., compare the amount of the distribution to Class A
Additional Interest for Collections processed for the Collection
Period for the Determination Date to Class A Additional Interest
as stated on the Form of Payment and Notification Letter (Trustee
Statement), provided by the Servicer to the Trustee monthly,
2
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Page Number Procedures
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divided by the Amount of Class A Bonds ($394,800,000) for each
Determination Date.
Page 1 For Item A) 7., compare the amount of the distribution to Class B
Monthly Interest for Collections processed for the Collection
Period for the Determination Date to the Interest Funding Account
Payment to Class B Investors divided by the Amount of Class B
Bonds ($6,300,000) for each Determination Date.
Page 1 For Item A) 8., compare the amount of the distribution to Class B
Deficiency for Collections processed for the Collection Period
for the Determination Date to the Interest Funding Account Class
B Deficiency Amount as stated on the Settlement Statement divided
by the Amount of Class B Bonds ($6,300,000) for each
Determination Date.
Page 1 For Item A) 9., compare the amount of the distribution to Class B
Additional Interest for Collections processed for the Collection
Period for the Determination Date to Class B Additional Interest
as stated on the Trustee Statement divided by the Amount of Class
B Bonds ($6,300,000) for each Determination Date.
Page 1 For Item A) 10., compare the amount of the distribution to
Collateral Monthly Interest for Collections processed for the
Collection Period for the Determination Date to the Settlement
Statement by adding the Collateral Monthly Interest Distributed
and Amount Withdrawn from Spread Account to Fund Shortfalls
divided by 1,000 divided by the amount of CIA Bonds
($18,900,000).
Page 1 For Item A) 11., compare the amount of the distribution to
Accrued and unpaid Collateral Monthly Interest for the Collection
Period for the Determination Date to the Amount of unpaid
interest due to CIA Holder on the Settlement Statement divided by
the amount of CIA Bonds ($18,900,000).
Page 1 For Item B.) 1.(a), compare the amount of the aggregate amount of
Principal Collections allocated to the Class A Certificates for
the related Collection Period by multiplying the Principal
Component of Collections by the Class A Floating Percentage which
is the Beginning Class A Adjusted Invested Amount divided by the
Beginning Trust Component plus the Beginning Excess Funding
Account Balance or the Beginning Adjusted Invested Amount plus
3
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Page Number Procedures
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the Transferor Amount, whichever is greater, as stated on the
Settlement Statement.
Page 1 For Item B.) 1.(b), compare the amount of the aggregate amount of
Principal Collections allocated to the Class B Certificates for
the related Collection Period by multiplying the Principal
Component of Collections by the Class B Floating Percentage which
is the Beginning Class B Invested Amount divided by the Beginning
Trust Component plus the Beginning Excess Funding Account Balance
or the Beginning Adjusted Invested Amount plus the Transferor
Amount, whichever is greater, as stated on the Settlement
Statement.
Page 1 For Item B.) 1. (c), compare the amount of the aggregate amount
of Principal Collections allocated to Collateral Investor
Interest for the related Collection Period by multiplying the
Principal Component of Collections by the Collateral Floating
Percentage which is the Beginning Collateral Invested Amount
divided by the Beginning Trust Component plus the Beginning
Excess Funding Account Balance or the Beginning Adjusted Invested
Amount plus the Transferor Amount, whichever is greater, as
stated on the Settlement Statement.
Page 1 For Item B.) 2. (a), compare the amount of the Trust Principal
Component as of the end of the related Collection Period to the
General Ledger by multiplying the Ending Receivables Balance by
one minus the Yield Factor (2.00%).
Page 1 For Item B.) 2. (b), compare the amount of the Series 1997-1
Invested Amount for the Collection Period by adding the ending
Class A, B and Collateral Invested Amounts on the Settlement
Statement as of the end of the related Transfer Date.
Page 1 For Item B.) 2. (c), compare the amount of the Series 1997-1
Adjusted Invested Amount for the Collection Period by adding the
ending Class A, B and Collateral Invested Amounts to the
Settlement Statement as of the end of the related Transfer Date.
Page 1 For Item B.) 2. (d), compare the amount of the Series 1997-1
Class A Invested Amount to the Beginning Class A Adjusted
Invested Amount on the Settlement Statement as of the end of the
related Transfer Date.
4
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Page Number Procedures
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Page 1 For Item B.) 2. (e), compare the amount of the Series 1997-1
Class A Adjusted Invested Amount to the Ending Class A Adjusted
Invested Amount on the Settlement Statement as of the end of the
related Transfer Date.
Page 1 For Item B.) 2. (f), compare the amount of the Series 1997-1
Class B Invested Amount to the Ending Class B Invested Amount on
the Settlement Statement as of the end of the related Transfer
Date.
Page 1 For Item B.) 2. (g), compare the amount of the Collateral
Invested Amount to the Ending Collateral Invested Amount on the
Settlement Statement as of the end of the related Transfer Date.
Page 2 For Item B.) 2. (h), compare the amount of the Floating
Allocation Percentage with respect to the related Collection
Period to the summation of the Class A, B and Collateral Floating
Percentage, (items B. 2. (i), (j) and (k) on the Statement).
Page 2 For Item B.) 2. (i), compare the amount of the Class A Floating
Percentage with respect to the related Collection Period to the
Settlement Statement by dividing the Beginning Class A Adjusted
Investment Amount by the sum of the Beginning Trust Principal
Component and the Excess Funding Account Beginning Balance or the
Beginning Adjusted Investment Amount and the Transferor Amount,
whichever is greater.
Page 2 For Item B.) 2. (j), compare the amount of the Class B Floating
Percentage with respect to the related Collection Period to the
Settlement Statement by dividing the Beginning Class B Adjusted
Investment Amount by the sum of the Beginning Trust Principal
Component and the Excess Funding Account Beginning Balance or the
Beginning Adjusted Investment Amount and the Transferor Amount,
whichever is greater.
Page 2 For Item B.) 2. (k), compare the amount of the Collateral
Floating Percentage with respect to the related Collection Period
to the Settlement Statement by dividing the Beginning Collateral
Investment Amount by the sum of the Beginning Trust Principal
Component and the Excess Funding Account Beginning Balance or the
Beginning Adjusted Investment Amount and the Transferor Amount,
whichever is greater.
5
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Page Number Procedures
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Page 2 For Item B.) 2. (l), the amount of the Fixed Allocation
Percentage with respect to the related Collection Period is not
applicable because the Collection Periods reviewed do not fall
into the Accumulation or Early Amortization Period as indicated
on the Settlement Statement.
Page 2 For Item B.) 2. (m), the amount of the Class A Fixed Percentage
with respect to the related Collection Period is not applicable
because the Collection Periods reviewed do not fall into the
Accumulation or Early Amortization Period as indicated on the
Settlement Statement.
Page 2 For Item B.) 2. (n), the amount of the Class B Fixed Percentage
with respect to the related Collection Period is not applicable
because the Collection Periods reviewed do not fall into the
Accumulation or Early Amortization Period as indicated on the
Settlement Statement.
Page 2 For Item B.) 2. (o), the amount of the Collateral Fixed
Percentage with respect to the related Collection Period is not
applicable because the Collection Periods reviewed do not fall
into the Accumulation or Early Amortization Period as indicated
on the Settlement Statement.
Page 2 For Item B.) 3., compare the amount of the aggregate amount of
outstanding balances in the Accounts which were delinquent as of
the end of the last day of the related Collection Period to the
Settlement Statement for the Aggregate Account Balance and
Percentage of Total Receivables for (a) 30-59 days, (b) 60-89
days, (c) 90-119 days, (d) 120-149 days and the Total.
Page 2 For Item B.) 4. (a), compare the amount of the Investor Default
Amount for the related Collection Period to the summation of
Class A, B and Collateral Investor Default Amounts, (items B. 4.
(b), (c) and (d) on the Statement).
Page 2 For Item B.) 4. (b), compare the amount of the Class A Investor
Default Amount for the related Collection Period Settlement
Statement by multiplying the Defaulted Receivable and the Class A
Floating Percentage.
6
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Page Number Procedures
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Page 2 For Item B.) 4. (c), compare the amount of the Class B Investor
Default Amount for the related Collection Period to the
Settlement Statement by multiplying the Defaulted Receivable and
the Class B Floating Percentage.
Page 2 For Item B.) 4. (d), compare the amount of the Collateral
Investor Default Amount for the related Collection Period to the
Settlement Statement by multiplying the Defaulted Receivable and
the Collateral Floating Percentage.
Page 3 For Item B.) 5.(a), compare the amount of the Aggregate Class A
Investor Charge-Offs for the related Collection Period to the
Class A Required Amount on the Settlement Statement.
Page 3 For Item B.) 5.(b), compare the amount of Class A Charge-Offs per
$1,000 of original Certificate Principal Balance for the related
Collection Period to the Class A Required Amount on the
Settlement Statement divided by the amount of Class A Bonds
($394,800,000).
Page 3 For Item B.) 5.(c), compare the amount of the Aggregate Class B
Investor Charge-Offs for the related Collection Period to the
Class B Investor Charge-Offs amount on the Settlement Statement.
Page 3 For Item B.) 5.(d), compare the amount of Class B Charge-Offs per
$1,000 of original Certificate Principal Balance for the related
Collection Period to the Class B Investor Charge-Off Amount on
the Settlement Statement divided by the amount of Class B Bonds
($6,300,000).
Page 3 For Item B.) 5.(e), compare the amount of the Aggregate
Collateral Investor Charge-Offs for the related Collection Period
to the Collateral Investor Charge-Offs Amount on the Settlement
Statement.
Page 3 For Item B.) 5.(f), compare the amount of the Collateral
Charge-Offs per $1,000 of original Certificate Principal Balance
for the related Collection Period to the Collateral Charge-Offs
Amount on the Settlement Statement divided by the amount of
Collateral Invested Amount Bonds ($18,900,000).
Page 3 For Item B.) 5.(g), compare the amount of the Aggregate Class A
Investor Charge-Offs reimbursed on the related Transfer Date to
the Reimbursed Investor Charge-Offs on the Settlement Statement.
7
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Page 3 For Item B.) 5.(h), compare the amount of the Class A Investor
Charge-Offs reimbursed for the related Collection Period to item
5.(g) divided by the amount of Class A Bonds ($394,800,000).
Page 3 For Item B.) 5.(i), compare the amount of the Aggregate Class B
Investor Charge-Offs reimbursed for the related Collection Period
to the Reimbursed Class B Investor Charge-Offs on the Settlement
Statement.
Page 3 For Item B.) 5.(j), compare the amount of the Class B Investor
Charge-Offs reimbursed per $1,000 of the original Certificate
Principal Balance for the related Collection Period to the amount
of the Reimbursed Class B Investor Charge-Offs.
Page 3 For Item B.) 5.(k), compare the amount of the Aggregate
Collateral Investor Charge-Offs reimbursed for the related
Transfer Date to the Reimbursed Collateral Investor Charge-Offs
on the Settlement Statement.
Page 3 For Item B.) 5.(l), compare the amount of the Collateral Investor
Charge-Offs reimbursed per $1,000 of original Certificate
Principal Balance for the related Collection Period to
item 5.(k) divided by the amount of Collateral Invested Amount
Bonds ($18,900,000).
Page 3 For Item B.) 6. (a), compare the amount of the Class A Monthly
Servicing Fee for the related Collection Period to the Settlement
Statement by multiplying the Initial Class A Investment Amount
and the Net Servicing Fee Rate of 1% divided by 12.
Page 3 For Item B.) 6. (b), compare the amount of the Class B Monthly
Servicing Fee for the related Collection Period to the Settlement
Statement by multiplying the Initial Class B Investment Amount
and the Net Servicing Fee Rate of 1% divided by 12.
Page 3 For Item B.) 6. (c), compare the amount of the Collateral Monthly
Servicing Fee for the related Collection Period to the Settlement
Statement by multiplying the Initial Collateral Investment Amount
and the Net Servicing Fee Rate of 1% divided by 12.
Page 3 For Item B.) 7. (a), compare the amount of the Reallocated
Collateral Principal Collections for the related Collection
Period to the Settlement Statement.
8
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Page Number Procedures
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Page 3 For Item B.) 7. (b), compare the amount of the Reallocated Class
B Principal Collections for the related Collection Period to the
Settlement Statement.
Page 3 For Item B.) 7. (c), compare the amount of the Collateral
Invested Amount as of the Distribution Date to the Ending
Collateral Invested Amount, item B. 2. (g) on the Settlement
Statement.
Page 3 For Item B.) 7. (d), compare the amount of the Reallocated Class
B Invested Amount as of the Distribution Date to the Ending Class
B Invested Amount, item B. 2. (f) on the Settlement Statement.
Page 4 For Item B.) 8. (a), compare the amount of the Aggregate Yield
Collections (including Net Interchange) processed during the
related Collection Period allocated in respect of the Class A
Investor Certificate to the Settlement Statement by multiplying
the Yield Collections by the Class A Floating Percentage, defined
in item B. 2. (i) on the Statement.
Page 4 For Item B.) 8. (b), compare the amount of the Aggregate Yield
Collections (including Net Interchange) processed during the
related Collection Period allocated in respect of the Class B
Investor Certificate to the Settlement Statement by multiplying
the Yield Collections by the Class B Floating Percentage, defined
in item B. 2. (j) on the Statement.
Page 4 For Item B.) 8. (c), compare the amount of the Aggregate Yield
Collections (including Net Interchange) processed during the
related Collection Period allocated in respect of the Collateral
Investor Certificate to the Settlement Statement by multiplying
the Yield Collections by the Collateral Floating Percentage,
defined in item B. 2. (k) on the Statement.
Page 4 For Item B.) 9. (a), compare the amount of the Principal Funding
Account Amount on the related Transfer Date to the Principal
Funding Account ending balance on the Settlement Statement.
Page 4 For Item B.) 9. (b), compare the amount of the Deficit Controlled
Accumulation Amount with respect to the related Collection Period
to the Deficit Controlled Accumulation Amount on the Settlement
Statement.
9
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Page Number Procedures
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Page 4 For Item B.) 9. (c), compare the amount of the Principal Funding
Investment Proceeds deposited in the Collection Account on the
related Transfer Date to the Principal Funding Investment
Proceeds on the Settlement Statement.
Page 4 For Item B.) 9. (d), compare the amount of the Reserve Draw
Amount deposited in the Collection Account on the related
Transfer Date to the Reserve Draw Amount on the Settlement
Statement.
Page 4 For Item B.) 10., compare the amount of the Reserve Draw Amount
on the related Transfer Date to the Reserve Draw Amount on the
Settlement Statement.
Page 4 For Item B.) 11., compare the amount of the Overconcentration
Draw Amount on the related Transfer Date to the Overconcentration
Draw Amount on the Settlement Statement.
Page 4 For Item B.) 12. (a), compare the amount of the Class A Available
Funds on deposit in the Collection Account on the related
Transfer Date to the Class A Available funds on the Settlement
Statement which is Yield Collections minus Servicer Interchange
multiplied by the sum of the Class A Floating Percentage, Reserve
Draw Amount, Interest and Earnings included in Class A Available
Funds, and Principal Funding Investment Proceeds.
Page 4 For Item B.) 12. (a), compare the amount of the Class B Available
Funds on deposit in the Collection Account on the related
Transfer Date to the Class B Available funds on the Settlement
Statement which is Yield Collections minus Servicer Interchange
multiplied by the Class B Floating Percentage.
Page 4 For Item B.) 12. (a), compare the amount of the Collateral
Available Funds on deposit in the Collection Account on the
related Transfer Date to the Collateral Available funds on the
Settlement Statement which is Yield Collections minus Servicer
Interchange multiplied by the Collateral Floating Percentage.
Page 4 For Item B.) 13. (a), compare the amount of the Portfolio Yield
for the related Collection Period to the Portfolio Yield on the
Settlement Statement which is Yield Component of Collections plus
Interest and Earnings on funds on deposit in Excess Funding
Account times Floating Allocation Percentage plus Principal
10
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Page Number Procedures
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Funding Investment Proceeds, Reserve Draw Amount, and
Overconcentration Draw Amount, minus Investor Default Amount
allocable to Series 1997-1 divided by the Ending Class B Invested
Amount, and the Ending Collateral Invested Amount, multiplied by
12.
Page 4 For Item B.) 13. (b), compare the amount of the Base Rate for the
related Collection Period to the Base Rate on the Settlement
Statement which is the sum of Class A, B and Collateral Monthly
Interest and Class A, B and Collateral Servicing Fee divided by
the sum of the Ending Class A Invested Amount, the Ending Class B
Invested Amount, and the Ending Collateral Invested Amount,
multiplied by 12.
Page 4 For Item B.) 14., compare the amount of the Monthly Payment Rate
for the related Collection Period by dividing collections from
the Settlement Statement by the Ending Receivables balance for
the prior month from the Settlement Statement.
Page 4 For Item B.) 15., compare the amount of the Principal Payment
Rate for the related Collection Period by dividing the Principal
Component of Collections by the Ending Trust Principal Component
for the prior month from the Settlement Statement.
Page 4 For Item B.) 16. compare the amount of the Gross Losses as a
Percentage of Charge Volume and Fees for the related Collection
Period to the Settlement Statement by dividing the Gross
Defaulted Receivables by Gross Charge Volume and Fees multiplied
by the Monthly Payment Rate, item B. 14. on the Statement,
multiplied by 12.
Page 4 For Item B.) 17., compare the amount of the Minimum Transferor's
Percentage for the related Collection Period to the product of
the maximum aggregate adjustments / Gross Charge Volume & Fees
over past 12 months, the Dilution Horizon Percentage, Gross
Charge Volume & Fees / Ending Receivables, and Stressed Trust
Dilution Factor Balance divided by 2, rounded up, and multiplied
by 2 if greater than .01 as stated on the Settlement Statement.
Page 5 For Item 1., compare the amount of the Investor Percentage of
Principal Collections for the related Collection Period by
multiplying the Principal Component of Collections from the
11
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Page Number Procedures
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Settlement Statement by the Floating Allocation Percentage at
item B. 2. (h) on the Statement.
Page 5 For Item 2., compare the amount of the Investor Percentage of
Yield Collections for the related Collection Period by
multiplying the Yield Component and Interest Earnings on Funds in
Excess Funding Account on the Settlement Statement by the
Floating Allocation Percentage at item B.2. (h) on the Statement.
Page 5 For Item 3., compare the amount of the Investor Percentage of Net
Interchange for the related Collection Period to the Settlement
Statement by multiplying the Net Interchange from the Settlement
Statement by the Floating Allocation Percentage at item B. 2. (h)
on the Statement.
Page 5 For Item 4., compare the amount of the Servicer Interchange for
the related Collection Period to the Servicer Interchange Amount
on the Settlement Statement.
Page 5 For Item 5., compare the amount of the aggregate amount of funds
on deposit in Collection Account allocable to Series 1997-1
Certificates to the Settlement Statement by adding Collections
and Net Interchange.
Page 5 For Item 6., compare the amount of the Funds in Principal Funding
Account allocable to Series 1997-1 Certificates for the related
Collection Period to the Settlement Statement.
Page 5 For Item 7., compare the amount of the aggregate amount of funds
paid in accordance with the Loan Agreement pursuant to Section
4.11 by adding the Collateral Monthly Interest Funded and Amounts
due Collateral Interest Holder on the Settlement Statement.
Page 5 For Item 8., compare the amount of the Required Collateral
Invested Amount over the Collateral Invested Amount for the
related Collection Period to the Settlement Statement.
Page 5 For Item 9., compare the amount of the Collateral Invested Amount
for the related Collection Period to item B. 2. (g) on the
Statement.
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Page 5 For Item 10. (i), compare the amount of Monthly Interest,
Deficiency Amounts, and Additional Interest payable to the Class
A Certificateholders for the related Collection Period to the
Settlement Statement.
Page 5 For Item 10. (ii), compare the amount of Monthly Interest,
Deficiency Amounts, and Additional Interest payable to the Class
B Certificateholders for the related Collection Period to the
Settlement Statement.
Page 5 For Item 10. (iii), compare the amount of Monthly Interest,
Deficiency Amounts, and Additional Interest payable to the
Collateral Interest Holder for the related Collection Period to
the Settlement Statement.
Page 5 For Item 11. (i), compare the amount of Principal payable to the
Class A Certificateholders for the related Collection Period to
the Settlement Statement.
Page 5 For Item 11. (ii), compare the amount of Principal payable to the
Class B Certificateholders for the related Collection Period to
the Settlement Statement.
Page 5 For Item 11. (iii), compare the amount of Principal payable to
the Collateral Interest Holder for the related Collection Period
to the Settlement Statement.
Page 5 For Item 12. (i), compare the amount of all amounts payable to
the Class A Certificateholders for the related Collection Period
from the summation of item 10. (i) and 11. (i) on the Statement.
Page 5 For Item 12. (ii), compare the amount of all amounts payable to
the Class B Certificateholders for the related Collection Period
from the summation of item 10. (ii) and 11. (ii) on the
Statement.
Page 5 For Item 12.) (iii), compare the amount of all amounts payable to
the Collateral Interest Holder for the related Collection Period
from the summation of item 10. (iii) and 11. (iii) on the
Statement.
Page 5 For Item 13.), compare the status of an Early Amortization Event
to the Settlement Statement.
13
<PAGE>
Very truly yours,
Ernst & Young LLP
Acknowledgments:
/s/ Randy L. Ritterman
----------------------------------------
Randy L. Ritterman
U.S. Bancorp
/s/ David P. Grandstrand
----------------------------------------
David P. Grandstrand
U. S. Bancorp
14
<PAGE>
ATTACHMENT B
DETAIL OF EXCEPTION
<TABLE>
<CAPTION>
MARCH 1997 MONTHLY AS AS
CERTIFICATEHOLDER STATEMENT DESCRIPTION CALCULATED REPORTED
- -------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Gross Losses as a Percentage of
Page 4, Item B.) 16 Charge Volume & Fees 0.32% 0.33%
</TABLE>
