<PAGE>
UNITED STATES
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): September 17, 1998
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
---------------------------------------------------
(Exact Name of registrant specified in its charter)
(Originator of the Chase Credit Card Master Trust)
United States 333-43173 22-2382028
- --------------- ---------------- -------------------
(State or other (Commission File (I.R.S. Employer
Jurisdiction of Number) Identification No.)
Incorporation)
802 Delaware Avenue
Wilmington, Delaware 19801
----------------------------------------
(Address of principal executive offices)
Registrant's telephone number, including area code: (302) 575-5000
<PAGE>
Item 5. Other Events
On September 17, 1998, the Underwriting Agreement, dated as of
September 17, 1998 (the "Underwriting Agreement"), among Chase Manhattan Bank
USA, National Association ("Chase USA"), as Transferor, The Chase Manhattan Bank
("CMB"), as Servicer, and Chase Securities Inc. ("CSI"), as Underwriter, was
executed and delivered by the respective parties thereto. On September 24, 1998,
the Series 1998-5 Supplement, dated as of September 24, 1998, to the Second
Amended and Restated Pooling and Servicing Agreement, dated as of September 1,
1996 (the "Second Amended and Restated Pooling and Servicing Agreement"), among
Chase USA, as Transferor on and after June 1, 1996, CMB, as Transferor prior to
June 1, 1996 and as Servicer, and the Bank of New York, as Trustee (the
"Trustee"), was executed and delivered by the respective parties thereto.
Item 7. Financial Statements, Pro Forma Financial Statements
and Exhibits
Exhibits
4.1 Underwriting Agreement, dated as of September 17,
1998, among Chase USA, as Transferor, CMB, as
Servicer, and CSI, as Underwriter.
4.2 Series 1998-5 Supplement, dated as of September 24,
1998, to the Second Amended and Restated Pooling and
Servicing Agreement, among Chase USA, as Transferor
on and after June 1, 1996, CMB, as Transferor prior
to June 1, 1996 and as Servicer, and the Trustee.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
THE CHASE MANHATTAN BANK
By: /s/ Patrick J. Margey
-----------------------------
Name: Patrick J. Margey
Title: Vice President
Date: October 5, 1998
<PAGE>
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit Sequentially
Number Exhibit Numbered Pages
- ------- ------- --------------
<S> <C> <C>
4.1 Underwriting Agreement, dated as of September 17, 1998,
among Chase USA, as Transferor, CMB, as Servicer, and
CSI, as Underwriter.
4.2 Series 1998-5 Supplement, dated as of September 24, 1998,
to the Second Amended and Restated Pooling and Servicing
Agreement, among Chase USA, as Transferor on and after
June 1, 1996, CMB, as Transferor prior to June 1, 1996
and as Servicer, and the Trustee.
</TABLE>
<PAGE>
CHASE CREDIT CARD MASTER TRUST
(formerly known as Chemical Master Credit Card Trust I)
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
(Transferor)
THE CHASE MANHATTAN BANK
(Servicer)
UNDERWRITING AGREEMENT
(Standard Terms)
September 17, 1998
Chase Securities Inc.
As Underwriter and as
Representative of the
several Underwriters
named in the
Terms Agreement
270 Park Avenue
New York, New York 10017
Ladies and Gentlemen:
Chase Manhattan Bank USA, National Association (the "Bank"),
proposes to cause the Chase Credit Card Master Trust (formerly known as Chemical
Master Credit Card Trust I) (the "Trust") to issue the Fixed Rate Asset Backed
Certificates designated in the applicable Terms Agreement (as hereinafter
defined) (the "Certificates"). The Certificates will be issued pursuant to a
Pooling and Servicing Agreement (the "Pooling and Servicing Agreement")
described in the applicable Terms Agreement between the Bank, as Transferor on
and after June 1, 1996, The Chase Manhattan Bank, as Transferor prior to June 1,
1996 and as Servicer (the "Servicer"), and the trustee identified in the
applicable Terms Agreement (the "Trustee"), as supplemented by the Series
Supplement having the date stated in the applicable Terms Agreement, between the
Bank, as Transferor, the Servicer and the Trustee (the "Supplement"). The Series
of Certificates designated in the applicable Terms Agreement will be sold in a
public offering through the underwriters listed on Schedule I to the applicable
Terms Agreement (the "Underwriters"). Certificates of any Series sold to the
Underwriters shall be sold pursuant to a Terms Agreement by and between the Bank
and the Underwriters, a form of which is attached hereto as Exhibit A (a "Terms
Agreement"), which incorporates by reference this Underwriting Agreement (the
"Agreement," which may include the applicable Terms Agreement if the context so
requires). Any Series of Certificates sold pursuant to any Terms Agreement may
<PAGE>
include the benefits of a letter of credit, cash collateral guaranty or account,
collateral interest, surety bond, insurance policy, spread account, reserve
account or other similar arrangement for the benefit of the Certificateholders
of such Series ("Credit Enhancement"). With respect to any such Credit
Enhancement, the Bank may enter into an agreement (the "Credit Enhancement
Agreement") by and between the Bank and the provider of the Credit Enhancement
(the "Credit Enhancement Provider"). The term "applicable Terms Agreement" means
the Terms Agreement dated the date hereof. Each Certificate will represent a
specified percentage undivided interest in the Trust. The assets of the Trust
include, among other things, certain amounts due on a portfolio of MasterCard7
and VISA7 revolving credit card accounts of the Bank (the "Receivables"), and
the benefit of the Credit Enhancement, if any. To the extent not defined herein,
capitalized terms used herein have the meanings assigned to such terms in the
Pooling and Servicing Agreement. Unless otherwise stated herein or in the
applicable Terms Agreement, as the context otherwise requires or if such term is
otherwise defined in the Pooling and Servicing Agreement, each capitalized term
used or defined herein or in the applicable Terms Agreement shall relate only to
the Series of Certificates designated in the applicable Terms Agreement and no
other Series of Asset Backed Certificates issued by the Trust.
Section 1. Representations and Warranties of the Bank. Upon
the execution of the applicable Terms Agreement, the Bank represents and
warrants to the Underwriters that:
(a) The Bank has prepared and filed with the Securities and
Exchange Commission (the "Commission") in accordance with the
provisions of the Securities Act of 1933, as amended, and the rules and
regulations of the Commission thereunder (collectively, the "Act"), a
registration statement on Form S-3 (having the registration number
stated in the applicable Terms Agreement), including a form of
prospectus, relating to the Certificates. Such registration statement,
as amended at the time it was declared effective by the Commission,
including all material incorporated by reference therein, including all
information contained in any Additional Registration Statement (as
defined herein) and deemed to be part of such registration statement as
of the time such Additional Registration Statement (if any) was
declared effective by the Commission pursuant to the General
Instructions of the Form on which it was filed and including all
information (if any) deemed to be a part of such registration statement
as of the time it was declared effective by the Commission pursuant to
Rule 430A(b) ("Rule 430A(b)") under the Act (such registration
statement, the "Initial Registration Statement") has been declared
effective by the Commission. If any post-effective amendment has been
filed with respect to the Initial Registration Statement, prior to the
execution and delivery of the applicable Terms Agreement, the most
recent such amendment has been declared effective by the Commission. If
2
<PAGE>
(i) an additional registration statement, including the contents of the
Initial Registration Statement incorporated by reference therein and
including all information (if any) deemed to be a part of such
additional registration statement pursuant to Rule 430A(b)(the
"Additional Registration Statement") relating to the Certificates has
been filed with the Commission pursuant to Rule 462(b) ("Rule 462(b)")
under the Act and, if so filed, has become effective upon filing
pursuant to Rule 462(b), then the Certificates have been duly
registered under the Act pursuant to the Initial Registration Statement
and such Additional Registration Statement or (ii) an Additional
Registration Statement is proposed to be filed with the Commission
pursuant to Rule 462(b) and will become effective upon filing pursuant
to Rule 462(b), then upon such filing the Certificates will have been
duly registered under the Act pursuant to the Initial Registration
Statement and such Additional Registration Statement. If the Bank does
not propose to amend the Initial Registration Statement or, if an
Additional Registration Statement has been filed and the Bank does not
propose to amend it and if any post-effective amendment to either such
registration statement has been filed with the Commission prior to the
execution and delivery of the applicable Terms Agreement, the most
recent amendment (if any) to each such registration statement has been
declared effective by the Commission or has become effective upon
filing pursuant to Rule 462(c) under the Act or, in the case of any
Additional Registration Statement, Rule 462(b). The Initial
Registration Statement and any Additional Registration Statement are
hereinafter referred to collectively as the "Registration Statements"
and individually as a "Registration Statement." Copies of the
Registration Statements, together with any post-effective amendments
have been furnished to the Underwriters. The Bank proposes to file with
the Commission pursuant to Rule 424 ("Rule 424") under the Act a
supplement (the "Prospectus Supplement") to the form of prospectus
included in a Registration Statement (such prospectus, in the form it
appears in a Registration Statement or in the form most recently
revised and filed with the Commission pursuant to Rule 424 is
hereinafter referred to as the "Basic Prospectus") relating to the
Certificates and the plan of distribution thereof. The Basic Prospectus
and the Prospectus Supplement, together with any amendment thereof or
supplement thereto, is hereinafter referred to as the "Final
Prospectus." Except to the extent that the Underwriters shall agree in
writing to a modification, the Final Prospectus shall be in all
substantial respects in the form furnished to the Underwriters prior to
the execution of the relevant Terms Agreement, or to the extent not
completed at such time, shall contain only such material changes as the
Bank has advised the Underwriters, prior to such time, will be included
therein. Any preliminary form of the Prospectus Supplement which has
heretofore been filed
3
<PAGE>
pursuant to Rule 424 is hereinafter called a "Preliminary
Final Prospectus;"
(b) The Initial Registration Statement, including such
amendments thereto as may have been required on the date of the
applicable Terms Agreement, and the Additional Registration Statement
(if any), relating to the Certificates, have been filed with the
Commission and such Initial Registration Statement as amended, and the
Additional Registration Statement (if any), have become effective. No
stop order suspending the effectiveness of the Initial Registration
Statement or the Additional Registration Statement (if any) has been
issued and no proceeding for that purpose has been instituted or, to
the knowledge of the Bank, threatened by the Commission;
(c) The Initial Registration Statement conforms, and any
amendments or supplements thereto and the Final Prospectus will
conform, in all material respects to the requirements of the Act, and
do not and will not, as of the applicable effective date as to the
Initial Registration Statement and any amendment thereto, as of the
applicable filing date as to the Final Prospectus and any supplement
thereto, and as of the Closing Date, contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, and
the Additional Registration Statement (if any) and the Initial
Registration Statement conform, in all material respects to the
requirements of the Act, and do not and will not, as of the applicable
effective date as to the Additional Registration Statement, contain an
untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; provided, however, that this representation and
warranty shall apply only during the period that a prospectus relating
to the Certificates is required to be delivered under the Act by
dealers in connection with the initial public offering of such
Certificates (such period being hereinafter sometimes referred to as
the "prospectus delivery period"); provided, further, that this
representation and warranty shall not apply to any statements or
omissions made in reliance upon and in conformity with information
furnished in writing to the Bank by or on behalf of the Underwriters
specifically for use in connection with the preparation of a
Registration Statement and the Final Prospectus;
(d) As of the Closing Date, the representations and warranties
of the Bank, as Transferor, in the Pooling and Servicing Agreement and
the Supplement will be true and correct;
(e) The Bank has been duly organized and is validly existing
as a national bank in good standing under the laws
4
<PAGE>
of the United States, with power and authority to own its properties
and conduct its business as described in the Final Prospectus, and has
been duly qualified as a foreign corporation for the transaction of
business and is in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts any
business, so as to require such qualification, other than where the
failure to be so qualified or in good standing would not have a
material adverse effect on the condition (financial or otherwise),
results of operations, business or prospects of the Bank and its
subsidiaries, taken as a whole;
(f) The Certificates have been duly authorized, and, when
issued and delivered pursuant to the Pooling and Servicing Agreement
and the Supplement, duly authenticated by the Trustee and paid for by
the Underwriters in accordance with the terms of this Agreement and the
applicable Terms Agreement, will be duly and validly executed, issued
and delivered and entitled to the benefits provided by the Pooling and
Servicing Agreement and the Supplement; each of the Pooling and
Servicing Agreement and the Supplement have been duly authorized and,
when executed and delivered by the Bank, as Transferor, each of the
Pooling and Servicing Agreement and the Supplement will (assuming due
execution and delivery by the Trustee) constitute a valid and binding
agreement of the Bank; the Certificates, the Pooling and Servicing
Agreement and the Supplement conform to the descriptions thereof in the
Final Prospectus in all material respects; and, if applicable, when
executed by the Bank, as Transferor, the Credit Enhancement Agreement
will (assuming due execution and delivery by the Trustee and Credit
Enhancement Provider) constitute a valid and binding agreement of the
Bank;
(g) No consent, approval, authorization or order of, or filing
with, any court or governmental agency or body is required to be
obtained or made by the Bank for the consummation of the transactions
contemplated by this Agreement, the applicable Terms Agreement, the
Pooling and Servicing Agreement or the Supplement except such as have
been obtained and made under the Act, such as may be required under
state securities laws and the filing of any financing statements
required to perfect the Trust's interest in the Receivables;
(h) The Bank is not in violation of its Articles of
Association or By-laws or in default in the performance or observance
of any obligation, agreement, covenant or condition contained in any
agreement or instrument to which it is a party or by which it or its
properties is bound which would have a material adverse effect on the
transactions contemplated herein, in the Pooling and Servicing
Agreement or the Supplement. The execution, delivery and performance of
this Agreement, the applicable Terms Agreement, the Pooling and
Servicing Agreement, the
5
<PAGE>
Supplement and the Credit Enhancement Agreement, and the issuance and
sale of the Certificates and compliance with the terms and provisions
thereof will not result in a breach or violation of any of the terms
of, or constitute a default under, any statute, rule, regulation or
order of any governmental agency or body or any court having
jurisdiction over the Bank or any of its properties or any material
agreement or instrument to which the Bank is a party or by which the
Bank is bound or to which any of the properties of the Bank is subject,
or the Articles of Association or Bylaws of the Bank except for any
such breaches or violations or defaults as would not individually or in
the aggregate have a material adverse effect on the transactions
contemplated herein, in the Pooling and Servicing Agreement and the
Supplement;
(i) Other than as set forth or contemplated in the Final
Prospectus, there are no legal or governmental proceedings pending or,
to the knowledge of the Bank, threatened to which any of the Bank or
its subsidiaries is or may be a party or to which any property of the
Bank or its subsidiaries is or may be the subject which, if determined
adversely to the Bank, could individually or in the aggregate
reasonably be expected to have a material adverse effect on the Bank's
credit card business or on the interests of the holders of the
Certificates; and there are no contracts or other documents of a
character required to be filed as an exhibit to the Initial
Registration Statement or the Additional Registration Statement (if
any) or to be described in the Initial Registration Statement, the
Additional Registration Statement (if any) or the Basic Prospectus
which are not filed or described as required; and
(j) Each of this Agreement and the applicable Terms Agreement
have been duly authorized, executed and delivered by the Bank.
Section 2. Purchase and Sale. Subject to the terms and
conditions and in reliance upon the covenants, representations and warranties
herein set forth, the Bank agrees to sell to the Underwriters, and the
Underwriters agree to purchase from the Bank, the principal amount of
Certificates set forth opposite each Underwriter's name in Schedule I to the
applicable Terms Agreement. The purchase price for the Certificates shall be as
set forth in the applicable Terms Agreement.
The Bank acknowledges and agrees that Chase Securities Inc.
may sell Certificates to any of its affiliates, and that any such affiliates may
sell such Certificates to Chase Securities Inc.
Section 3. Delivery and Payment. Unless otherwise provided
in the applicable Terms Agreement, payment for Certificates shall be made to
the Bank or to its order by wire
6
<PAGE>
transfer of same day funds at the offices of Simpson Thacher & Bartlett in New
York, New York at 10:00 A.M., New York City time, on the Closing Date (as
hereinafter defined) specified in the Terms Agreement, or at such other time on
the same or such other date as the Underwriters and the Bank may agree upon. The
time and date of such payment for the Certificates as specified in the
applicable Terms Agreement are referred to herein as the "Closing Date." As used
herein, the term "Business Day" means any day other than a day on which banks
are permitted or required to be closed in New York City.
Unless otherwise provided in the applicable Terms Agreement,
payment for the Certificates shall be made against delivery to the Underwriters
of the Certificates registered in the name of Cede & Co. as nominee of The
Depository Trust Company and in such denominations as the Underwriters shall
request in writing not later than two full Business Days prior to the Closing
Date. The Bank shall make the Certificates available for inspection by the
Underwriters in New York, New York not later than one full Business Day prior to
the Closing Date.
Section 4. Offering by Underwriters. It is understood that the
Underwriters propose to offer the Certificates for sale to the public, which may
include selected dealers, as set forth in the Final Prospectus.
Section 5. Covenants of the Bank. The Bank covenants and
agrees with the Underwriters that upon the execution of the applicable Terms
Agreement:
(a) Promptly following the execution of such applicable Terms
Agreement, the Bank will prepare a Prospectus Supplement setting forth
the amount of Certificates covered thereby and the terms thereof not
otherwise specified in the Basic Prospectus, the price at which such
Certificates are to be purchased by the Underwriters, the initial
public offering price, the selling concessions and allowances, and such
other information as the Bank deems appropriate. The Bank will file
such Prospectus Supplement with the Commission pursuant to Rule 424
within the time prescribed therein and will provide evidence
satisfactory to the Underwriters of such timely filing. In addition, to
the extent that the Underwriters (i) have provided to the Bank
Collateral Term Sheets (as defined below) that the Underwriters have
provided to prospective investors, the Bank will file such Collateral
Term Sheets as an exhibit to a report on Form 8-K within two business
days of its receipt thereof, or (ii) have provided to the Bank
Structural Term Sheets or Computational Materials (each as defined
below) that such Underwriters have provided to a prospective investor,
the Bank will file or cause to be filed with the Commission a report on
Form 8- K containing such Structural Term Sheet and Computational
Materials, as soon as reasonably practicable after the date of this
Agreement, but in any event, not later than the date
7
<PAGE>
on which the Final Prospectus is filed with the Commission
pursuant to Rule 424.
(b) During the prospectus delivery period, before filing any
amendment or supplement to the Initial Registration Statement, the
Additional Registration Statement (if any) or the Final Prospectus, the
Bank will furnish to the Underwriters copies of the proposed amendment
or supplement for review and will not file any such proposed amendment
or supplement to which any Underwriter reasonably objects.
(c) During the prospectus delivery period, the Bank will
advise the Underwriters promptly after it receives notice thereof, (i)
when any amendment to any Registration Statement shall have become
effective, (ii) of any request by the Commission for any amendment or
supplement to any Registration Statement or the Final Prospectus or for
any additional information, (iii) of the issuance by the Commission of
any stop order suspending the effectiveness of any Registration
Statement or the initiation or threatening of any proceeding for that
purpose, and (iv) of the receipt by the Bank of any notification with
respect to any suspension of the qualification of the Certificates for
offer and sale in any jurisdiction or the initiation or threatening of
any proceeding for such purpose; and will use its best efforts to
prevent the issuance of any such stop order or notification and, if any
is issued, will promptly use its best efforts to obtain the withdrawal
thereof.
(d) If, at any time during the prospectus delivery period, any
event occurs as a result of which the Final Prospectus as then
supplemented would include any 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 shall be necessary to amend or supplement the
Final Prospectus to comply with the Act, the Bank promptly will prepare
and file with the Commission, an amendment or a supplement which will
correct such statement or omission or effect such compliance.
(e) The Bank will endeavor to qualify the Certificates for
offer and sale under the securities or Blue Sky laws of such
jurisdictions as the Underwriters shall reasonably request and will
continue such qualification in effect so long as reasonably required
for distribution of the Certificates; provided, however, that the Bank
shall not be obligated to qualify to do business in any jurisdiction in
which it is not currently so qualified; and provided, further, that the
Bank shall not be required to file a general consent to service of
process in any jurisdiction.
(f) The Bank will furnish to each Underwriter, without charge,
two copies of each Registration Statement (including
8
<PAGE>
exhibits thereto), one of which will be signed, and to each Underwriter
conformed copies of each Registration Statement (without exhibits
thereto) and, during the prospectus delivery period, as many copies of
any Preliminary Final Prospectus and the Final Prospectus and any
supplement thereto as each Underwriter may reasonably request.
(g) For a period from the date of this Agreement until the
retirement of the Certificates, or until such time as the Underwriters
shall cease to maintain a secondary market in the Certificates,
whichever first occurs, the Bank will deliver to each Underwriter (i)
the annual statements of compliance, (ii) the annual independent
certified public accountants' reports furnished to the Trustee, (iii)
all documents required to be distributed to Certificateholders of the
Trust and (iv) all documents filed with the Commission pursuant to the
Exchange Act or any order of the Commission thereunder, in each case as
provided to the Trustee or filed with the Commission, as soon as such
statements and reports are furnished to the Trustee or filed or, if an
affiliate of the Bank is not the Servicer, as soon thereafter as
practicable.
(h) The Bank will pay all expenses incident to the performance
of its obligations under this Agreement, including without limitation:
(i) expenses of preparing, printing and reproducing each Registration
Statement, the Preliminary Final Prospectus, the Final Prospectus, this
Agreement, the applicable Terms Agreement, the Pooling and Servicing
Agreement, the Supplement and the Certificates, (ii) the cost of
delivering the Certificates to the Underwriters, (iii) any fees charged
by investment rating agencies for the rating of such Certificates, and
(iv) the reasonable expenses and costs (not to exceed the amount
specified in the applicable Terms Agreement) incurred in connection
with "blue sky" qualification of the Certificates for sale in those
states designated by the Underwriters and the printing of memoranda
relating thereto (it being understood that, except as specified in this
paragraph (h) and in Sections 8 and 9 hereof, the Underwriters will pay
all of their costs and expenses, including the fees of counsel to the
Underwriters, transfer taxes on resale of any Certificates by them and
advertising expenses connected with any offers that they may make).
(i) To the extent, if any, that the rating provided with
respect to the Certificates by the rating agency or agencies that
initially rate the Certificates is 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.
(j) The Bank will cause the Trust to make generally available
to Certificateholders and to the Underwriters as soon as practicable an
earnings statement covering a period
9
<PAGE>
of at least twelve months beginning with the first fiscal quarter of
the Trust occurring after the effective date of the Initial
Registration Statement (or, if later, the effective date of the
Additional Registration Statement), which shall satisfy the provisions
of Section 11(a) of the Act and Rule 158 of the Commission promulgated
thereunder.
(k) During the period beginning on the date hereof and
continuing to and including the Business Day following the Closing
Date, the Bank will not offer, sell, contract to sell or otherwise
dispose of any credit card asset-backed securities of the Bank which
are substantially similar to the Certificates without the prior written
consent of each Underwriter or unless such securities are referenced in
the Terms Agreement.
Section 6. Representations and Warranties of the Underwriters.
Each Underwriter represents, warrants, covenants and agrees with the Bank that:
(a) It either (A) has not provided any potential investor with
a Collateral Term Sheet (that is required to be filed with the
Commission within two business days of first use under the Terms of the
Public Securities Association Letter as described below), or (B) has,
substantially contemporaneously with its first delivery of such
Collateral Term Sheet to a potential investor, delivered such
Collateral Term Sheet to the Bank, which Collateral Term Sheet, if any,
is attached to this Agreement as Exhibit B.
(b) It either (A) has not provided any potential investor with
a Structural Term Sheet or Computational Materials, or (B) has provided
any such Structural Term Sheet or Computational Materials to the Bank,
which Structural Term Sheets and Computational Materials, if any, are
attached to this Agreement as Exhibit C.
(c) It either (A) has not provided any potential investor with
a Series Term Sheet or (B) has provided any Series Term Sheet to the
Bank, which Series Term Sheets, if any, are attached to this Agreement
as Exhibit D.
(d) Each Collateral Term Sheet bears a legend indicating that
the information contained therein will be superseded by the description
of the collateral contained in the Prospectus Supplement and, except in
the case of the initial Collateral Term Sheet, that such information
supersedes the information in all prior Collateral Term Sheets.
(e) Each Structural Term Sheet and Series Term Sheet and all
Computational Materials bear a legend substantially as follows (or in
such other form as may be agreed prior to the date of this Agreement):
10
<PAGE>
This information does not constitute either an offer to sell
or a solicitation of an offer to buy any of the securities
referred to herein. Information contained herein is
confidential and provided for information only, does not
purport to be complete and should not be relied upon in
connection with any decision to purchase the securities. This
information supersedes any prior versions hereof and will be
deemed to be superseded by any subsequent versions including,
with respect to any description of the securities or the
underlying assets, the information contained in the final
Prospectus and accompanying Prospectus Supplement. Offers to
sell and solicitations of offers to buy the securities are
made only by the final Prospectus and the related Prospectus
Supplement.
(f) It (at its own expense) agrees to provide to the Bank any
accountants' letters obtained relating to the Collateral Term Sheets,
Structural Term Sheets and Computational Materials, which accountants'
letters shall be
addressed to the Bank.
(g) It has not, and will not, without the prior written
consent of the Bank, provide any Collateral Term Sheets, Structural
Term Sheets, Series Term Sheets or Computational Materials to any
investor after the date of
this Agreement.
(h) 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 Certificates 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, it
has complied and shall comply with all applicable provisions of the
Financial Services Act 1986 of Great Britain with respect to anything
done by it in relation to the Certificates in, from or otherwise
involving the United Kingdom and if that Underwriter is an authorized
person under the Financial Services Act 1986, it has only promoted and
shall only promote (as that term is defined in Regulation 1.02 of the
Financial Services (Promotion of Unregulated Schemes) Regulations 1991)
to any person in the United Kingdom the scheme described in the
Prospectus if that person is of a kind described either in Section
76(2) of the Financial Services Act 1986 or in Regulation 1.04 of the
Financial Services (Promotion of Unregulated Schemes) Regulations 1991.
For purposes of this Agreement, "Collateral Term Sheets" and
"Structural Term Sheets" shall have the respective meanings assigned to them in
the February 13, 1995 letter of Cleary, Gottlieb, Steen & Hamilton on behalf of
the Public Securities Association (which letter, and the SEC staff's
11
<PAGE>
response thereto, were publicly available February 17, 1995). The term
"Collateral Term Sheet" as used herein includes any subsequent Collateral Term
Sheet that reflects a substantive change in the information presented.
"Computational Materials" has the meaning assigned to it in the May 17, 1994
letter of Brown & Wood on behalf of Kidder, Peabody & Co., Inc. (which letter,
and the SEC staff's response thereto, were publicly available May 20, 1994).
"Series Term Sheet" has the meaning assigned to it in the April 4, 1996 letter
of Latham & Watkins on behalf of Greenwood Trust Company (which letter, and the
SEC staff's response thereto, were publicly available April 5, 1996).
Section 7. Conditions to the Obligations of the Underwriters.
The obligations of the Underwriters to purchase and pay for Certificates on the
Closing Date shall be subject to the accuracy of the representations and
warranties of the Bank contained herein, to the accuracy of the statements of
the Bank made in any certificates pursuant to the terms hereof, to the
performance by the Bank of its obligations hereunder and under the applicable
Terms Agreement and to the following additional conditions:
(a) The Final Prospectus shall have been filed with the
Commission pursuant to Rule 424 in the manner and within the applicable
time period prescribed for such filing by the rules and regulations of
the Commission under the Act and in accordance with Section 5(a) of
this Agreement; and, as of the Closing Date, no stop order suspending
the effectiveness of any Registration Statement shall have been issued,
and no proceedings for such purpose shall have been instituted or
threatened by the Commission; and all requests for additional
information from the Commission with respect to any Registration
Statement shall have been complied with to the reasonable satisfaction
of the Representative.
(b) Subsequent to the date of this Agreement, there shall not
have occurred (i) any change, or any development involving a
prospective change, in or affecting particularly the business or
properties of the Bank which materially impairs the investment quality
of the Certificates; (ii) any suspension or material limitation of
trading of securities generally on the New York Stock Exchange or the
American Stock Exchange; (iii) a declaration of a general moratorium on
commercial banking activities in New York by either Federal or New York
State authorities; or (iv) any material outbreak or declaration of
hostilities or other calamity or crisis the effect of which on the
financial markets of the United States is such as to make it, in the
judgment of the Representative, impracticable to market the
Certificates on the terms specified herein and the applicable Terms
Agreement.
(c) The Underwriters have received a certificate of a Vice
President or other proper officer of the Bank, dated the Closing Date,
in which such officer, to the best of his
12
<PAGE>
knowledge, shall state that (i) the representations and warranties of
the Bank in this Agreement are true and correct in all material
respects, (ii) the Bank has complied with all agreements and satisfied
all conditions on its part to be performed or satisfied at or prior to
the Closing Date, (iii) no stop order suspending the effectiveness of a
Registration Statement has been issued and no proceedings for that
purpose have been instituted or are threatened by the Commission and
(iv) the Final Prospectus does not contain any untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading.
(d) The Bank shall have furnished to the Underwriters the
opinions of Simpson Thacher & Bartlett, counsel for the Bank, dated the
Closing Date, in substantially the forms attached hereto as Exhibits 1
through 3, with only such changes as shall be reasonably satisfactory
to the Representative.
(e) The Underwriters shall have received from Skadden, Arps,
Slate, Meagher & Flom LLP, counsel for the Underwriters, one or more
opinions, each dated the Closing Date, with respect to the validity of
the Certificates, the Initial Registration Statement, the Additional
Registration Statement (if any), the Final Prospectus, certain matters
of the Uniform Commercial Code, as adopted in the State of Delaware,
and such other related matters as the Representative may reasonably
require, and the Bank shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass on
such matters.
(f) At the date of the applicable Terms Agreement and at the
Closing Date, Price Waterhouse LLP (or such other independent public
accountants as shall be named in the applicable Terms Agreement),
certified independent public accountants for the Bank, shall have
furnished to the Underwriters a letter or letters, dated respectively
as of the date of the applicable Terms Agreement and as of the Closing
Date confirming that they are certified independent public accountants
within the meaning of the Act and the Exchange Act, and the respective
applicable published rules and regulations thereunder and substantially
in the form heretofore agreed and otherwise in form and in substance
satisfactory to the Representative and counsel for the Underwriters.
(g) The Underwriters shall receive evidence satisfactory to it
that, on or before the Closing Date, UCC-1 financing statements have
been or are being filed in the office of the Secretary of State of the
State of
13
<PAGE>
Delaware, reflecting the interest of the Trustee in the Receivables and
the proceeds thereof.
(h) The Underwriters shall have received from Emmet, Marvin &
Martin, LLP, counsel to the Trustee, an opinion, dated the Closing
Date, to the effect that:
(i) The Trustee has been duly organized and is
validly existing as a banking corporation under the laws of
New York and has the corporate power and authority to conduct
business and affairs as a trustee.
(ii) The Trustee has the corporate power and
authority to perform the duties and obligations of trustee
under, and to accept the trust contemplated by, the Pooling
and Servicing Agreement, the Supplement and the Credit
Enhancement Agreement.
(iii) Each of the Pooling and Servicing Agreement,
the Supplement and the Credit Enhancement Agreement has been
duly authorized, executed, and delivered by the Trustee and
constitutes a legal, valid and binding obligation of the
Trustee enforceable against the Trustee in accordance with its
terms, subject to the effects of bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights
generally, general equitable principles (whether considered in
a proceeding in equity or at law).
(iv) The Certificates have been duly executed and
authenticated by the Trustee.
(v) Neither the execution nor the delivery by the
Trustee of the Pooling and Servicing Agreement, the Supplement
and the Credit Enhancement Agreement nor the consummation of
any of the transactions contemplated thereby require the
consent or approval of, the giving of notice to, the
registration with, or the taking of any other action with
respect to, any governmental authority or agency under any
existing federal or state law governing the banking or trust
powers of the Trustee.
(vi) The execution and delivery of the Pooling and
Servicing Agreement, the Supplement and the Credit Enhancement
Agreement by the Trustee and the performance by the Trustee of
their respective terms do not conflict with or result in a
violation of (x) any law or regulation of any governmental
authority or agency under any existing federal or state law
governing the banking or trust powers of the Trustee, or (y)
the Certificate of Incorporation or By-laws of the Trustee.
14
<PAGE>
(i) The Underwriters shall be named as recipients or shall
have received reliance letters, if applicable, with respect to any
opinions delivered to the Bank by counsel of the Credit Enhancement
Provider, if any.
(j) The Underwriters shall have received evidence satisfactory
to them that the Certificates shall be rated in accordance with the
applicable Terms Agreement by the Rating Agency.
(k) The Underwriters shall have received a certificate of a
Vice President or other proper officer of the Servicer, dated the
Closing Date, in which such officer, to the best of his or her
knowledge, shall state that the representations and warranties of the
Servicer in the Pooling and Servicing Agreement and the Supplement are
true and correct.
(l) All proceedings in connection with the transactions
contemplated by this Agreement and all documents incident hereto shall
be reasonably satisfactory in form and substance to the Underwriters
and counsel for the Underwriters in all material respects and the
Underwriters and counsel for the Underwriters shall have received such
information, certificates and documents as the Underwriters or counsel
for the Underwriters may reasonably request.
If any of the conditions specified in this Section 7 shall not
have been fulfilled in all material respects when and as provided in this
Agreement, or if any of the opinions and certificates mentioned above or
elsewhere in this Agreement shall not be in all material respects reasonably
satisfactory in form and substance to the Underwriters and their counsel, this
Agreement and all obligations of the Underwriters hereunder may be cancelled at,
or at any time prior to, the Closing Date by the Underwriters. Notice of such
cancellation shall be given to the Bank in writing or by telephone or facsimile
confirmed in writing.
Section 8. Reimbursement of Underwriters' Expenses. If the
sale of the Certificates provided for herein is not consummated because any
condition to the obligations of the Underwriters set forth in Section 7 (other
than the condition set forth in paragraph (b) of Section 7) is not satisfied, or
because of any refusal, inability or failure on the part of the Bank to perform
any agreement herein or comply with any provision hereof other than by reason of
a default by the Underwriters, the Bank will reimburse the Underwriter for all
out-of-pocket expenses (including reasonable fees and disbursements of counsel)
that shall have been incurred by it in connection with the proposed purchase and
sale of the Certificates and upon demand the Bank shall pay the full amount
thereof to the Representative.
15
<PAGE>
Section 9. Indemnification and Contribution. (a) The Bank
agrees to indemnify and hold harmless the Underwriters, each of the directors
thereof, each of the officers who are involved in the Offering and each person,
if any, who controls each Underwriter within the meaning of the Act against any
and all losses, claims, damages or liabilities, joint or several, to which they
or any of them may become subject under the Act, the Exchange Act or any other
federal or state statutory law or regulation, at common law 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 a material fact contained in any Registration Statement as
originally filed or in any amendment thereof, or in any Preliminary Final
Prospectus or the Final Prospectus, or in any amendment thereof 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 agrees to reimburse each such
indemnified party for any legal or other expenses reasonably incurred by it in
connection with investigating or preparing to defend or defending any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
however, that (i) 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
any such untrue statement or alleged untrue statement or omission or alleged
omission made in any of such documents in reliance upon and in conformity with
written information furnished to the Bank by or on behalf of the Underwriters
specifically for use therein, and (ii) such indemnity with respect to any
Preliminary Final Prospectus shall not inure to any benefit of any Underwriter
(or any person controlling any of the Underwriters) from whom the person
asserting any such loss, claim, damage or liability purchased the Certificate
thereof if such person did not receive a copy of the Final Prospectus (or the
Final Prospectus as supplemented) at or prior to the confirmation of the sale of
such Certificates to such person in any case where such delivery is required by
the Act and the untrue statement or omission of a material fact contained in
such Preliminary Final Prospectus was corrected in the Final Prospectus (or the
Final Prospectus as supplemented). This indemnity agreement will be in addition
to any liability which the Bank may otherwise have.
(b) Each Underwriter agrees to indemnify and hold harmless the
Bank, each of the directors thereof, each of the officers who signs a
Registration Statement, and each person who controls the Bank within the meaning
of the Act, to the same extent as the foregoing indemnities from the Bank to the
Underwriters, but only with reference to written information furnished to the
Bank by or on behalf of each Underwriter specifically for use in the preparation
of the documents referred to in the foregoing indemnity. This indemnity
agreement will be in addition to any liability which each Underwriter may
otherwise have.
16
<PAGE>
(c) Promptly after receipt by an indemnified party under this
Section 9 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 this Section 9, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party will
not relieve it from any liability which it may have to any indemnified party
otherwise than under this Section 9 unless the indemnifying party is materially
prejudiced thereby. 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 appoint counsel satisfactory to such
indemnified party to represent the indemnified party in such action; provided,
however, that, if the defendants in any such action include both the indemnified
party and the indemnifying party and the indemnified party shall have reasonably
concluded that there may be legal defenses available to it and/or other
indemnified parties which are different from or additional to those available to
the indemnifying party, the indemnified party or parties shall have the right to
select separate counsel to defend such action on behalf of such indemnified
party or parties. Upon receipt of notice from the indemnifying party to such
indemnified party of its election so to appoint counsel to defend such action
and approval by the indemnified party of such counsel, the indemnifying party
will not be liable to such indemnified party under this Section 9 for any legal
or other expenses subsequently incurred by such indemnified party in connection
with the defense thereof unless (i) the indemnified party shall have employed
separate counsel in accordance with the proviso to the next preceding sentence
(it being understood, however, that the indemnifying party shall not be liable
for the expenses of more than one separate counsel, approved by the
Underwriter(s) being indemnified in the case of paragraph (a) of this Section 9,
representing the indemnified parties under such paragraph (a) who are parties to
such action), (ii) the indemnifying party shall not have employed counsel
satisfactory to the indemnified party to represent the indemnified party within
a reasonable time after notice of commencement of the action or (iii) the
indemnifying party has authorized the employment of counsel for the indemnified
party at the expense of the indemnifying party; and except that, if clause (i)
or (iii) is applicable, such liability shall be only in respect of the counsel
referred to in such clause (i) or (iii).
(d) If recovery is not available or is insufficient under the
foregoing indemnification provisions of this Section 9, for any reason other
than as specified herein, the parties entitled to indemnification by the terms
hereof shall be entitled to contribution to liabilities and expenses, except to
the extent that contribution is not permitted under Section 11(f) of the Act. In
determining the amount of contribution to which the Bank and the Underwriter are
entitled, there shall be considered the relative benefits received by each from
the offering of the Certificates (taking into account the total proceeds of the
offering received by the Bank and the total underwriting
17
<PAGE>
discounts and commissions received by the Underwriters), their relative
knowledge and access to information concerning the matter with respect to which
the claim was asserted, the opportunity to correct and prevent any statement or
omission, and any other equitable considerations appropriate under the
circumstances. The Bank and the Underwriters agree that it would not be
equitable if the amount of such contribution were determined by pro rata or per
capita allocation. None of the Underwriters nor any person controlling any
Underwriter shall be obligated to make contribution hereunder which in the
aggregate exceeds the total public offering price of the Certificates purchased
by such Underwriter under this Agreement, less the aggregate amount of any
damages which any Underwriter and its controlling persons have otherwise been
required to pay in respect of the same claim or any substantially similar claim.
Section 10. Default by an Underwriter. If, on the Closing
Date, any Underwriter or Underwriters default in the performance of its or their
obligations under this Agreement, the Representative may make arrangements for
the purchase of such Certificates by other persons satisfactory to the Bank and
the Representative, including any of the Underwriters, but if no such
arrangements are made by the Closing Date, then each remaining non-defaulting
Underwriter shall be severally obligated to purchase the Certificates which the
defaulting Underwriter or Underwriters agreed but failed to purchase on the
Closing Date in the respective proportions which the principal amount of
Certificates set forth opposite the name of each remaining non-defaulting
Underwriter in Schedule I to the Terms Agreement bears to the aggregate
principal amount of Certificates set forth opposite the names of all the
remaining non-defaulting Underwriters in Schedule I to the Terms Agreement;
provided, however, that the remaining non-defaulting Underwriters shall not be
obligated to purchase any of the Certificates on the Closing Date if the
aggregate principal amount of Certificates which the defaulting Underwriter or
Underwriters agreed but failed to purchase on such date exceeds one-eleventh of
the aggregate principal amount of the Certificates to be purchased on the
Closing Date, and any remaining non-defaulting Underwriter shall not be
obligated to purchase in total more than 110% of the principal amount of the
Certificates which it agreed to purchase on the Closing Date pursuant to the
terms of Section 2. If the foregoing maximums are exceeded and the remaining
Underwriters or other underwriters satisfactory to the Representative and the
Bank do not elect to purchase the Certificates which the defaulting Underwriter
or Underwriters agreed but failed to purchase, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter or the Bank,
except that the provisions of Section 11 shall not terminate and shall remain in
effect. As used in this Agreement, the term "Underwriter" includes, for all
purposes of this Agreement unless the context otherwise requires, any party not
listed in Schedule I to the Terms Agreement who, pursuant to this Section 10,
purchases Certificates which a defaulting Underwriter agreed but failed to
purchase.
18
<PAGE>
Section 11. Representations and Indemnities to Survive. The
respective agreements, representations, warranties, indemnities and other
statements of the Bank 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
you or the Bank or any of the officers, directors or controlling persons
referred to in Section 9 hereof, and will survive delivery of and payment for
the Certificates. The provisions of Sections 8 and 9 hereof shall survive the
termination or cancellation of this Agreement.
Section 12. Notices. All communication hereunder shall be in
writing and, if sent to the Underwriters will be mailed, delivered or telecopied
and confirmed to them at 270 Park Avenue, New York, New York 10017, Attention:
David A. Howard Jr., Telecopy No: (212) 834-6564; if sent to the Bank, will be
mailed, delivered or telecopied and confirmed to them care of Chase Manhattan
Bank USA, National Association, at 802 Delaware Avenue, Wilmington, Delaware,
19801, Telecopy No.: (302) 575-5467, Attention: Keith Schuck, Vice President.
Section 13. Miscellaneous. This Agreement is to be governed
by, and construed in accordance with, the laws of the State of New York; it may
be executed in two or more counterparts, each of which when so executed and
delivered shall be an original, but all of which together shall constitute one
and the same instrument. This Agreement shall inure to the benefit of and be
binding upon the parties hereto and their respective successors and assigns and
the officers and directors and controlling persons referred to in Section 9
hereof, and no other person shall have any right or obligation hereunder. This
Agreement supersedes all prior agreements and understandings between the parties
relating to the subject matter hereof, other than those contained in the Terms
Agreement executed in connection herewith. Neither this Agreement nor any term
hereof may be changed, waived, discharged or terminated orally, but only by an
instrument in writing signed by the party against whom enforcement of the
change, waiver, discharge or termination is sought. The headings in this
Agreement are for purposes of reference only and shall not limit or otherwise
affect the meaning hereof.
Section 14. Effectiveness. This Agreement shall become
effective upon execution and delivery of the applicable Terms Agreement.
If you are in agreement with the foregoing, please sign the
counterpart hereof and return it to the Bank, whereupon this letter and your
acceptance shall become a binding agreement among the Bank and the Underwriters.
Very truly yours,
CHASE MANHATTAN BANK USA,
19
<PAGE>
NATIONAL ASSOCIATION
By /s/ Keith Schuck
-------------------------------------------
Name: Keith Schuck
Title: Vice President
The foregoing Agreement is
hereby confirmed and accepted
as of the date hereof.
CHASE SECURITIES INC.
as representative of the
Underwriters named in
Schedule I hereto
By /s/ Christopher P. Davis
------------------------------
Name: Christopher P. Davis
Title: Vice President
20
<PAGE>
CHASE CREDIT CARD MASTER TRUST
CLASS A FLOATING RATE ASSET BACKED CERTIFICATES, SERIES 1998-5
CLASS B FLOATING RATE ASSET BACKED CERTIFICATES, SERIES 1998-5
TERMS AGREEMENT
Dated: September 17, 1998
To: Chase Manhattan Bank USA, National Association
Re: Underwriting Agreement dated September 17, 1998
Series Designation: Series 1998-5
Underwriters:
The Underwriters named on Schedule I attached hereto are the
"Underwriters" for the purpose of this Agreement and for the purposes of the
above-referenced Underwriting Agreement as such Underwriting Agreement is
incorporated herein and made a part hereof.
Terms of the Certificates:
Initial Interest Rate
Class Invested Amount or Formula Price to Public (1)
- ----- --------------- ------------- -------------------
Class A $650,000,000 LIBOR + 0.16% 100.000%
Class B $ 54,166,000 LIBOR + 0.36% 100.000%
(1) Plus accrued interest at the applicable rate from September 24, 1998.
Distribution Dates: Class A: the 15th day of each month (or if such 15th day is
not a business day the next succeeding business day), commencing November 16,
1998.
Class B: the 15th calendar day (or if such 15th day is not a business day, the
next succeeding business day) of each month, commencing November 16, 1998.
Certificate Ratings:
Class A: AAA by Standard & Poor's
Aaa by Moody's
AAA by Fitch
Class B: A by Standard & Poor's
A2 by Moody's
A by Fitch
A-1
<PAGE>
Credit Enhancement Provider: Bayerische Hypo-Und Vereinsbank
Trustee: The Bank of New York
Pooling and Servicing Agreement: The Second Amended and Restated Pooling and
Servicing Agreement, dated as of September 1, 1996, between Chase Manhattan Bank
USA, National Association, as Transferor on and after June 1, 1996, The Chase
Manhattan Bank, as Transferor prior to June 1, 1996 and as Servicer, and The
Bank of New York, as Trustee, on behalf of the Certificateholders of Chase
Credit Card Master Trust.
Supplement: Series 1998-5 Supplement, dated as of September 24, 1998, between
Chase Manhattan Bank USA, National Association, as Transferor on and after June
1, 1996, The Chase Manhattan Bank, as Transferor prior to June 1, 1996 and as
Servicer, and The Bank of New York, as Trustee, on behalf of the Series 1998-5
Certificateholders
Purchase Price:
The purchase price payable by the Underwriters for the
Certificates covered by this Agreement will be the following percentage of the
principal amounts to be issued:
Per Class A Certificate: 99.725%
Per Class B Certificate: 99.700%
Registration Statement: Registration No. 333-43173
Underwriting Commissions, Concessions and Discounts:
The Underwriter's discounts and commissions, the concessions
that the Underwriter may allow to certain dealers, and the discounts that such
dealers may reallow to certain other dealers, each expressed as a percentage of
the principal amount of the Class A Certificates and Class B Certificates, shall
be as follows:
Underwriting
Discounts Selling
Class and Concessions Concessions Reallowance
- ----- ---------------- ----------- -----------
Class A .275% .175% .150%
Class B .300% .200% .150%
Closing Date: September 24, 1998, 10:00 a.m., New York Time
Location of Closing: Simpson Thacher & Bartlett, 425 Lexington Avenue, New York,
New York 10017
Payment for the Certificates: Wire transfer of same day funds
Blue Sky Fees: Up to $25,000
A-2
<PAGE>
Opinion Modifications: None
Other securities being offered concurrently: None.
A-3
<PAGE>
The Underwriters agree, severally and not jointly, subject to
the terms and provisions of the above referenced Underwriting Agreement which is
incorporated herein in its entirety and made a part hereof, to purchase the
respective principal amounts of the above referenced Series of Certificates set
forth opposite their names on Schedule I hereto.
CHASE SECURITIES INC.
As Representative of
the Underwriters named
in Schedule I hereto
By: /s/ Christopher Davis
------------------------------------
Name: Christopher Davis
Title: Vice President
Accepted:
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
By: /s/ Keith Schuck
------------------------------------
Name: Keith Schuck
Title: Vice President
A-4
<PAGE>
SCHEDULE I
UNDERWRITERS
$650,000,000 Principal Amount of Class A Floating Rate Asset Backed
Certificates, Series 1998-5
Principal Amount
----------------
Chase Securities Inc. $162,500,000
Bear Stearns & Co. Inc. $162,500,000
Credit Suisse First Boston
Corporation $162,500,000
Prudential Securities
Incorporated $162,500,000
-------------
Total $650,000,000
-------------
-------------
$54,166,000 Principal Amount of Class B Floating Rate Asset Backed Certificates,
Series 1998-5
Principal Amount
----------------
Chase Securities Inc. $54,166,000
A-5
<PAGE>
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
Transferor on and after June 1, 1996,
THE CHASE MANHATTAN BANK,
Transferor prior to June 1, 1996 and Servicer
and
THE BANK OF NEW YORK,
Trustee
on behalf of the Series 1998-5 Certificateholders
-----------------------------
Series 1998-5 SUPPLEMENT
Dated as of September 24, 1998
to
SECOND AMENDED AND RESTATED POOLING AND SERVICING AGREEMENT
Dated as of September 1, 1996
-----------------------------
CHASE CREDIT CARD MASTER TRUST
Series 1998-5
<PAGE>
1
Series 1998-5 SUPPLEMENT, dated as of September 24, 1998 (this "Series
Supplement"), by and among CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
("Chase USA"), as Transferor on and after June 1, 1996, THE CHASE MANHATTAN
BANK, as Transferor prior to June 1, 1996 and as Servicer, and THE BANK OF NEW
YORK, as Trustee under the Second Amended Pooling and Servicing Agreement dated
as of September 1, 1996 between Chase USA, the Servicer and the Trustee (as may
be amended, modified or supplemented from time to time, the "Agreement").
Section 6.9 of the Agreement provides, among other things, that the
Transferor and the Trustee may at any time and from time to time enter into a
supplement to the Agreement for the purpose of authorizing the delivery by the
Trustee to the Transferor for the execution and redelivery to the Trustee for
authentication of one or more Series of Certificates.
Pursuant to this Series Supplement, the Transferor and the Trust shall
create a new Series of Investor Certificates and shall specify the Principal
Terms thereof.
SECTION I.1. Designation.
(a) There is hereby created a Series of Investor Certificates to be
issued in two classes pursuant to the Agreement and this Series Supplement and
to be known together as the "Series 1998-5 Certificates." The two classes shall
be designated the Class A Floating Rate Asset Backed Certificates, Series 1998-5
(the "Class A Certificates") and the Class B Floating Rate Asset Backed
Certificates, Series 1998-5 (the "Class B Certificates"). The Class A
Certificates and the Class B Certificates shall be substantially in the form of
Exhibits A-1 and A-2 hereto, respectively. In addition, there is hereby created
a third Class of an uncertificated interest in the Trust which shall be deemed
to be an "Investor Certificate" for all purposes under the Agreement and this
Series Supplement, except as expressly provided herein, and which shall be known
as the Collateral Interest, Series 1998-5 (the "Collateral Interest").
(b) Series 1998-5 shall be included in Group One (as defined below).
Series 1998-5 shall not be subordinated to any other Series.
(c) The Collateral Interest Holder, as holder of an "Investor
Certificate" under the Agreement, shall be entitled to the benefits of the
Agreement and this Series Supplement upon payment by the Collateral Interest
Holder of amounts owing on the Closing Date pursuant to the Loan Agreement.
Notwithstanding the foregoing, except as expressly provided herein, (i) the
provisions of Article VI and Article XII of the Agreement relating to the
registration, authentication, delivery, presentation, cancellation and surrender
of Registered Certificates shall not be applicable to the Collateral Interest,
(ii) the Opinion of Counsel specified in clause (d) of the sixth
<PAGE>
2
sentence of Section 6.9(b) of the Agreement shall not be required with respect
to the Collateral Interest and (iii) the Tax Opinion specified in clause (e) of
the sixth sentence of Section 6.9(b) of the Agreement shall address the effect
of the issuance of the Collateral Interest but parts (a) and (c) of any such Tax
Opinion shall not address, or be required to address, any tax consequences that
shall result to any Collateral Interest Holder.
SECTION I.2. Definitions.
In the event that any term or provision contained herein shall conflict
with or be inconsistent with any provision contained in the Agreement, the terms
and provisions of this Series Supplement shall govern. All Article, Section or
subsection references herein shall mean Articles, Sections or subsections of the
Agreement, except as otherwise provided herein. All capitalized terms not
otherwise defined herein are defined in the Agreement. Each capitalized term
defined herein shall relate only to the Investor Certificates and no other
Series of Certificates issued by the Trust.
"Accumulation Period" shall mean, solely for the purposes of the
definition of Monthly Principal Payment as such term is defined in each
Supplement, the Controlled Accumulation Period.
"Accumulation Period Factor" shall mean, for each Monthly
Period, a fraction, the numerator of which is equal to the sum of the initial
investor interests (or other amounts specified in the applicable Supplement) of
all outstanding Series, and the denominator of which is equal to the sum of (a)
the Initial Investor Interest, (b) the initial investor interests (or other
amounts specified in the applicable Supplement) of all outstanding Series (other
than Series 1998-5) which are not expected to be in their revolving periods, and
(c) the initial investor interests (or other amounts specified in the applicable
Supplement) of all other outstanding Series which are not allocating Shared
Principal Collections to other Series and are in their revolving periods.
"Accumulation Period Length" shall have the meaning assigned such term
in subsection 4.9(i).
"Accumulation Shortfall" shall initially mean zero and shall thereafter
mean, with respect to any Monthly Period during the Controlled Accumulation
Period, the excess, if any, of the Controlled Deposit Amount for the previous
Monthly Period over the amount deposited into the Principal Funding Account
pursuant to subsection 4.9(e)(i) with respect to the Class A Certificates for
the previous Monthly Period.
"Additional Certificate Date" shall have the meaning assigned such term
in subsection 10(a).
<PAGE>
3
"Additional Certificates" shall have the meaning assigned such term in
subsection 10(a).
"Adjusted Investor Interest" shall mean, with respect to any date of
determination, an amount equal to the sum of (a) the Class A Adjusted Investor
Interest and (b) the Class B Investor Interest and (c) the Collateral Interest.
"Aggregate Investor Default Amount" shall mean, with respect to any
Monthly Period, the sum of the Investor Default Amounts in respect of such
Monthly Period.
"Available Investor Principal Collections" shall mean with respect to
any Monthly Period, an amount equal to (a) the Investor Principal Collections
for such Monthly Period, minus (b) the amount of Reallocated Collateral
Principal Collections and Reallocated Class B Principal Collections with respect
to such Monthly Period which pursuant to Section 4.12 are required to fund the
Class A Required Amount and the Class B Required Amount, plus (c) the amount of
Shared Principal Collections that are allocated to Series 1998-5 in accordance
with subsection 4.13(b).
"Available Reserve Account Amount" shall mean, with respect to any
Transfer 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 4.15(b) on such date, but before giving
effect to any deposit made or to be made pursuant to subsection 4.11(i) to the
Reserve Account on such date) and (b) the Required Reserve Account Amount.
"Base Rate" shall mean, with respect to any Monthly Period, the
annualized percentage equivalent of a fraction, the numerator of which is equal
to the sum of the Class A Monthly Interest, the Class B Monthly Interest (net of
any available investment earnings on deposit in the Spread Account (as defined
in the Loan Agreement) for each monthly period), the Collateral Monthly
Interest, each for the related Interest Period, and the Investor Servicing Fee
with respect to such Monthly Period and the denominator of which is the Investor
Interest as of the close of business on the last day of such Monthly Period.
"Class A Additional Interest" shall have the meaning specified in
Section 4.6(a).
"Class A Adjusted Investor Interest" shall mean, with respect to any
date of determination, an amount equal to the Class A Investor Interest minus
the Principal Funding Account Balance on such date of determination.
"Class A Available Funds" shall mean, with respect to any Monthly
Period, an amount equal to the sum of (a) the Class A Floating Allocation of the
Collections of Finance Charge Receivables allocated to the Investor Certificates
and deposited
<PAGE>
4
in the Finance Charge Account for such Monthly Period (or to be deposited in the
Finance Charge Account on the related Transfer Date with respect to the
preceding Monthly Period pursuant to the third paragraph of subsection 4.3(a)
and Section 2.8 of the Agreement and subsection 3(b) of this Series Supplement),
excluding the portion of Collections of Finance Charge Receivables attributable
to Servicer Interchange, (b) with respect to any Monthly Period during the
Controlled Accumulation Period prior to the payment in full of the Class A
Investor Interest, the Principal Funding Investment Proceeds arising pursuant to
subsection 4.14(b), if any, with respect to the related Transfer Date and (c)
the Reserve Draw Amount (up to the Available Reserve Draw Account Amount) plus
any amounts of interest and earnings described in subsections 4.15(b) and
4.15(d) which will be deposited into the Finance Charge Account on the related
Transfer Date.
"Class A Certificate Rate" shall mean from the Closing Date through
November 15, 1998 and with respect to each Interest Period thereafter, a per
annum rate equal to 0.16% per annum in excess of LIBOR, as determined on the
related LIBOR Determination Date.
"Class A Certificateholder" shall mean the Person in whose name a Class
A Certificate is registered in the Certificate Register.
"Class A Certificates" shall mean any of the certifi cates executed by
the Transferor and authenticated by or on behalf of the Trustee, substantially
in the form of Exhibit A-1 hereto.
"Class A Deficiency Amount" shall have the meaning specified in
subsection 4.6(a).
"Class A Fixed Allocation" shall mean, with respect to any Monthly
Period following the Revolving Period, the percentage equivalent (which
percentage shall never exceed 100%) of a fraction, the numerator of which is the
Class A Investor Interest as of the close of business on the last day of the
Revolving Period and the denominator of which is equal to the Investor Interest
as of the close of business on the last day of the Revolving Period.
"Class A Floating Allocation" shall mean, with respect to any Monthly
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is the Class A Adjusted Investor Interest as
of the close of business on the last day of the preceding Monthly Period and the
denominator of which is equal to the Adjusted Investor Interest as of the close
of business on such day; provided, however, that, with respect to the first
Monthly Period, the Class A Floating Allocation shall mean the percentage
equivalent of a fraction, the numerator of which is the Class A Initial
<PAGE>
5
Investor Interest and the denominator of which is the Initial Investor Interest.
"Class A Initial Investor Interest" shall mean the aggregate initial
principal amount of the Class A Certificates, which is $650,000,000.
"Class A Investor Allocation" shall mean, with respect to any Monthly
Period, (a) with respect to Default Amounts and Finance Charge Receivables at
any time and Principal Receivables during the Revolving Period, the Class A
Floating Allocation, and (b) with respect to Principal Receivables during the
Controlled Accumulation Period or Rapid Amortization Period, the Class A Fixed
Allocation.
"Class A Investor Charge-Offs" shall have the meaning specified in
subsection 4.10(a).
"Class A Investor Default Amount" shall mean, with respect to each
Transfer Date, an amount equal to the product of (a) the Aggregate Investor
Default Amount for the related Monthly Period and (b) the Class A Floating
Allocation applicable for the related Monthly Period.
"Class A Investor Interest" shall mean, on any date of determination,
an amount equal to (a) the Class A Initial Investor Interest, minus (b) the
aggregate amount of principal pay ments made to Class A Certificateholders prior
to such date and minus (c) the excess, if any, of the aggregate amount of Class
A Investor Charge-Offs pursuant to subsection 4.10(a) over Class A Investor
Charge-Offs reimbursed pursuant to subsection 4.11(b) prior to such date of
determination; provided, however, that the Class A Investor Interest may not be
reduced below zero.
"Class A Monthly Interest" shall have the meaning specified in
subsection 4.6(a).
"Class A Monthly Principal" shall mean the monthly principal
distributable in respect of the Class A Certificates as calculated in accordance
with subsection 4.7(a).
"Class A Required Amount" shall have the meaning specified in
subsection 4.8(a).
"Class A Scheduled Payment Date" shall mean the Septem ber 2003
Distribution Date.
"Class A Servicing Fee" shall have the meaning speci fied in subsection
3(a) of this Series Supplement.
"Class B Additional Interest" shall have the meaning specified in
subsection 4.6(b).
<PAGE>
6
"Class B Available Funds" shall mean, with respect to any Monthly
Period, an amount equal to the Class B Floating Allocation of the Collections of
Finance Charge Receivables and allocated to the Investor Certificates and
deposited in the Finance Charge Account for such Monthly Period (or to be
deposited in the Finance Charge Account on the related Transfer Date with
respect to the preceding Monthly Period pursuant to the third paragraph of
subsection 4.3(a) of the Agreement and subsection 3(b) of this Series
Supplement), excluding the portion of Collections of Finance Charge Receivables
attributable to Servicer Interchange.
"Class B Certificate Rate" shall mean from the Closing Date through
November 15, 1998, and for each Interest Period thereafter, a per annum rate
equal to 0.36% per annum in excess of LIBOR, as determined on the related LIBOR
Determination Date.
"Class B Certificateholder" shall mean the Person in whose name a Class
B Certificate is registered in the Certificate Register.
"Class B Certificates" shall mean any of the certifi cates executed by
the Transferor and authenticated by or on behalf of the Trustee, substantially
in the form of Exhibit A-2 hereto.
"Class B Deficiency Amount" shall have the meaning specified in
subsection 4.6(b).
"Class B Fixed Allocation" shall mean, with respect to any Monthly
Period following the Revolving Period, the percentage equivalent (which
percentage shall never exceed 100%) of a fraction, the numerator of which is the
Class B Investor Interest as of the close of business on the last day of the
Revolving Period and the denominator of which is equal to the Investor Interest
as of the close of business on the last day of the Revolving Period.
"Class B Floating Allocation" shall mean, with respect to any Monthly
Period, the percentage equivalent (which percentage shall never exceed 100%) of
a fraction, the numerator of which is the Class B Investor Interest as of the
close of business on the last day of the preceding Monthly Period and the
denominator of which is equal to the Adjusted Investor Interest as of the close
of business on such day; provided, however, that, with respect to the first
Monthly Period, the Class B Floating Allocation shall mean the percentage
equivalent of a fraction, the numerator of which is the Class B Initial Investor
Interest and the denominator of which is the Initial Investor Interest.
"Class B Initial Investor Interest" shall mean the aggregate initial
principal amount of the Class B Certificates, which is $54,166,000.
<PAGE>
7
"Class B Investor Allocation" shall mean, with respect to any Monthly
Period, (a) with respect to Default Amounts and Finance Charge Receivables at
any time or Principal Receivables during the Revolving Period, the Class B
Floating Allocation, and (b) with respect to Principal Receivables during the
Controlled Accumulation Period or Rapid Amortization Period, the Class B Fixed
Allocation.
"Class B Investor Charge-Offs" shall have the meaning specified in
subsection 4.10(b).
"Class B Investor Default Amount" shall mean, with respect to each
Transfer Date, an amount equal to the product of (a) the Aggregate Investor
Default Amount for the related Monthly Period and (b) the Class B Floating
Allocation applicable for the related Monthly Period.
"Class B Investor Interest" shall mean, on any date of determination,
an amount equal to (a) the Class B Initial Investor Interest, minus (b) the
aggregate amount of principal pay ments made to Class B Certificateholders prior
to such date, minus (c) the aggregate amount of Class B Investor Charge-Offs for
all prior Transfer Dates pursuant to subsection 4.10(b), minus (d) the amount of
the Reallocated Class B Principal Collec tions allocated pursuant to subsection
4.12(a) on all prior Transfer Dates for which the Collateral Interest has not
been reduced, minus (e) an amount equal to the amount by which the Class B
Investor Interest has been reduced on all prior Transfer Dates pursuant to
subsection 4.10(a) and plus (f) the aggregate amount of Excess Spread allocated
and available on all prior Transfer Dates pursuant to subsection 4.11(d), for
the purpose of reimbursing amounts deducted pursuant to the foregoing clauses
(c), (d) and (e); provided, however, that the Class B Investor Interest may not
be reduced below zero.
"Class B Monthly Interest" shall have the meaning specified in
subsection 4.6(b).
"Class B Monthly Principal" shall mean the monthly principal
distributable in respect of the Class B Certificates as calculated in accordance
with subsection 4.7(b).
"Class B Required Amount" shall have the meaning specified in
subsection 4.8(b).
"Class B Scheduled Payment Date" shall mean the October 2003
Distribution Date.
"Class B Servicing Fee" shall have the meaning speci fied in subsection
3(a) hereof.
"Closing Date" shall mean September 24, 1998.
<PAGE>
8
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Collateral Allocation" shall mean, with respect to any Monthly Period,
(a) with respect to Default Amounts and Finance Charge Receivables at any time
or Principal Receivables during the Revolving Period, the Collateral Floating
Allocation, and (b) with respect to Principal Receivables during the Controlled
Accumulation Period or Rapid Amortization Period, the Collateral Fixed
Allocation.
"Collateral Available Funds" shall mean, with respect to any Monthly
Period, an amount equal to the Collateral Floating Allocation of the Collections
of Finance Charge Receivables allocated to the Investor Certificates and
deposited in the Finance Charge Account for such Monthly Period (or to be
deposited in the Finance Charge Account on the related Transfer Date with
respect to the preceding Monthly Period pursuant to the third paragraph of
subsection 4.3(a) of the Agreement and subsection 3(b) of this Series
Supplement), excluding the portion of Collections of Finance Charge Receivables
attributable to Servicer Interchange.
"Collateral Charge-Offs" shall have the meaning speci fied in
subsection 4.10(c).
"Collateral Default Amount" shall mean, with respect to any Transfer
Date, an amount equal to the product of (a) the Aggregate Investor Default
Amount for the related Monthly Period and (b) the Collateral Floating Allocation
applicable for the related Monthly Period.
"Collateral Fixed Allocation" shall mean, with respect to any Monthly
Period following the Revolving Period, the percentage equivalent (which
percentage shall never exceed 100%) of a fraction, the numerator of which is the
Collateral Interest as of the close of business on the last day of the Revolving
Period and the denominator of which is equal to the Investor Interest as of the
close of business on the last day of the Revolving Period.
"Collateral Floating Allocation" shall mean, with respect to any
Monthly Period, the percentage equivalent (which percentage shall never exceed
100%) of a fraction, the numerator of which is the Collateral Interest as of the
close of business on the last day of the preceding Monthly Period and the
denominator of which is equal to the Adjusted Investor Interest as of the close
of business on such day; provided, however, that, with respect to the first
Monthly Period, the Collateral Floating Allocation shall mean the percentage
equivalent of a fraction, the numerator of which is the Collateral Initial
Interest and the denominator of which is the Initial Investor Interest.
<PAGE>
9
"Collateral Initial Interest" shall mean the aggregate initial
principal amount of the Collateral Interest, which is $69,643,524.
"Collateral Interest" shall mean, on any date of determination, an
amount equal to (a) the Collateral Initial Interest, minus (b) the aggregate
amount of principal payments made to the Collateral Interest Holder prior to
such date, minus (c) the aggregate amount of Collateral Charge-offs for all
prior Transfer Dates pursuant to subsection 4.10(c), minus (d) the amount of
Reallocated Principal Collections allocated pursuant to subsections 4.12(a) and
(b) on all prior Transfer Dates, minus (e) an amount equal to the amount by
which the Collateral Interest has been reduced on all prior Transfer Dates
pursuant to subsections 4.10(a) and (b), and plus (f) the aggregate amount of
Excess Spread allocated and available on all prior Transfer Dates pursuant to
subsection 4.11(h), for the purpose of reimbursing amounts deducted pursuant to
the foregoing clauses (c), (d) and (e); provided further, however, that the
Collateral Interest may not be reduced below zero.
"Collateral Interest Holder" shall mean the entity so designated in the
Loan Agreement.
"Collateral Interest Servicing Fee" shall have the meaning specified in
subsection 3(a) hereof.
"Collateral Monthly Interest" shall mean the monthly interest
distributable in respect of the Collateral Interest as calculated in accordance
with subsection 4.6(c).
"Collateral Monthly Principal" shall mean the monthly principal
distributable in respect of the Collateral Interest as calculated in accordance
with subsection 4.7(c).
"Collateral Rate" shall mean, for any Interest Period, the rate
specified in the Loan Agreement.
"Controlled Accumulation Amount" shall mean (a) for any Transfer Date
with respect to the Controlled Accumulation Period prior to the payment in full
of the Class A Investor Interest, $54,166,667; provided, however, that if the
Accumulation Period Length is determined to be less than 12 months pursuant to
subsection 4.9(i), the Controlled Accumulation Amount for each Transfer Date
with respect to the Controlled Accumulation Period prior to the payment in full
of the Class A Investor Interest will be equal to (x) the Class A Initial
Investor Interest divided by (y) the number of Monthly Periods in the Controlled
Accumulation Period as determined pursuant to subsection 4.9(i), and (b) for any
Transfer Date with respect to the Controlled Accumulation Period after payment
in full of the Class A Investor Interest, an amount equal to the Class B
Investor Interest as of such Transfer Date.
<PAGE>
10
"Controlled Accumulation Period" shall mean, unless a Pay Out Event
shall have occurred prior thereto, the period commencing at the close of
business on August 31, 2002 or such later date as is determined in accordance
with subsection 4.9(i) and ending on the first to occur of (a) the commencement
of the Rapid Amortization Period and (b) the Series 1998-5 Termination Date.
"Controlled Deposit Amount" shall mean, with respect to any Transfer
Date, the sum of (a) the Controlled Accumulation Amount for such Transfer Date
and (b) any existing Accumulation Shortfall.
"Covered Amount" shall mean, as of the Transfer Date with respect to
any Interest Period, an amount equal to the product of (a) (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 Certificate Rate in effect
with respect to such Interest Period, and (b) the Principal Funding Account
Balance as of the close of business on the Distribution Date preceding such
Transfer Date (after giving effect to all of the transactions occurring on such
date).
"Credit Enhancement" shall mean (a) with respect to the Class A
Certificates, the subordination of the Class B Certificates and the Collateral
Interest, and (b) with respect to the Class B Certificates, the subordination of
the Collateral Interest.
"Credit Enhancement Provider" shall mean the Collateral Interest
Holder.
"Cumulative Series Principal Shortfall" shall mean the sum of the
Series Principal Shortfalls (as such term is defined in each of the related
Series Supplements) for each Series.
"Daily Principal Shortfall" shall mean, on any date of determination,
the excess of the Monthly Principal Payment for the Monthly Period relating to
such date over the month to date amount of Collections processed in respect of
Principal Receivables for such Monthly Period allocable to investor certificates
of all outstanding Series, not subject to reallocation, which are on deposit or
to be deposited in the Principal Account on such date.
"Deficiency Amount" shall mean, at any time of determi nation, the sum
of the Class A Deficiency Amount and the Class B Deficiency Amount.
"Distribution Date" shall mean November 16, 1998 and the fifteenth day
of each calendar month thereafter, or if such fifteenth day is not a Business
Day, the next succeeding Business Day.
<PAGE>
11
"Excess Principal Funding Investment Proceeds" shall mean, with respect
to each Transfer Date relating to the Controlled Accumulation Period, the
amount, if any, by which the Principal Funding Investment Proceeds for such
Transfer Date exceed the Covered Amount determined on such Transfer Date.
"Excess Spread" shall mean, with respect to any Trans fer Date, the sum
of the amounts with respect to such Transfer Date, if any, specified pursuant to
subsections 4.9(a)(iv), 4.9(b)(iii) and 4.9(c)(ii).
"Finance Charge Shortfall" shall mean, with respect to any Transfer
Date, the excess, if any, of the amount distributable pursuant to the
subsections 4.11(a) through (i) over Excess Spread.
"Fitch" shall mean Fitch IBCA, Inc. or its successors.
"Fixed Investor Percentage" shall mean, with respect to any Monthly
Period, the percentage equivalent of a fraction, the numerator of which is the
Investor Interest as of the close of business on the last day of the Revolving
Period and the denominator of which is the greater of (a) the sum of (i) the
aggregate amount of Principal Receivables in the Trust determined as of the
close of business on the last day of the prior Monthly Period and (ii) the
Excess Funding Amount as of the close of business on such last day of the prior
Monthly Period and (b) the sum of the numerators used to calculate the Investor
Percentages (as such term is defined in the Agreement) for allocations with
respect to Principal Receivables for all outstanding Series on such date of
determination; provided, however, that with respect to any Monthly Period in
which an Addition Date occurs or in which a Removal Date occurs, the amount
determined pursuant to clause (a)(i) hereof shall be the sum of (A) the
aggregate amount of Principal Receivables in the Trust as of the close of
business on the last day of the prior Monthly Period for the period from and
including the first day of such Monthly Period to but excluding the related
Addition Date or Removal Date and (B) the aggregate amount of Principal
Receivables in the Trust as of the beginning of the day on the related Addition
Date or Removal Date after adjusting for the aggregate amount of Principal
Receivables added to or removed from the Trust on the related Addition Date or
Removal Date, for the period from and including the related Addition Date or
Removal Date to and including the last day of such Monthly Period.
"Floating Investor Percentage" shall mean, with respect to any Monthly
Period, the percentage equivalent of a fraction, the numerator of which is the
Adjusted Investor Interest as of the close of business on the last day of the
prior Monthly Period (or with respect to the first Monthly Period, the Initial
Investor Interest) and the denominator of which is the greater of (a) the sum of
(i) the aggregate amount of Principal Receivables as of the close of business on
the last day of the prior Monthly
<PAGE>
12
Period (or with respect to the first calendar month in the first Monthly Period,
the aggregate amount of Principal Receivables in the Trust as of the close of
business on the day immediately preceding the Closing Date, and with respect to
the second calendar month in the first Monthly Period, the aggregate amount of
Principal Receivables as of the close of business on the last day of the first
calendar month in the first Monthly Period) and (ii) the Excess Funding Amount
as of the close of business on such last day of the prior Monthly Period and (b)
the sum of the numerators used to calculate the Investor Percentages (as such
term is defined in the Agreement) for allocations with respect to Finance Charge
Receivables, Default Amounts or Principal Receivables, as applicable, for all
outstanding Series on such date of determination; provided, however, that with
respect to any Monthly Period in which an Addition Date occurs or in which a
Removal Date occurs, the amount determined pursuant to clause (a)(i) hereof
shall be the sum of (A) the aggregate amount of Principal Receivables in the
Trust as of the close of business on the last day of the prior Monthly Period
for the period from and including the first day of such Monthly Period to but
excluding the related Addition Date or Removal Date and (B) the aggregate amount
of Principal Receivables in the Trust as of the beginning of the day on the
related Addition Date or Removal Date after adjusting for the aggregate amount
of Principal Receivables added to or removed from the Trust on the related
Addition Date or Removal Date, for the period from and including the related
Addition Date or Removal Date to and including the last day of such Monthly
Period.
"Group One" shall mean Series 1998-5 and each other Series specified in
the related Supplement to be included in Group One.
"Initial Investor Interest" shall mean $773,809,524; provided, however,
that following the issuance of any Additional Certificates pursuant to Section
10 hereof "Initial Investor Interest" shall mean the sum of $773,809,524 and the
initial investor interest of such Additional Certificates.
"Interest Period" shall mean, with respect to any Distribution Date,
the period from and including the previous Distribution Date through the day
preceding such Distribution Date, except that the initial Interest Period shall
be the period from and including the Closing Date through the day preceding the
initial Distribution Date.
"Investor Certificateholder" shall mean (a) with respect to the Class A
Certificates, the holder of record of a Class A Certificate, (b) with respect to
the Class B Certificates, the holder of record of a Class B Certificate and (c)
with respect to the Collateral Interest, the Collateral Interest Holder.
<PAGE>
13
"Investor Certificates" shall mean the Class A Certifi cates, the Class
B Certificates and the Collateral Interest.
"Investor Default Amount" shall mean, with respect to any Receivable in
a Defaulted Account, an amount equal to the product of (a) the Default Amount
and (b) the Floating Investor Percentage on the day such Account became a
Defaulted Account.
"Investor Interest" shall mean, on any date of determi nation, an
amount equal to the sum of (a) the Class A Investor Interest, (b) the Class B
Investor Interest and (c) the Collateral Interest, each as of such date.
"Investor Percentage" shall mean for any Monthly Period, (a) with
respect to collections of Finance Charge Receivables and Default Amounts at any
time and collections of Principal Receivables during the Revolving Period, the
Floating Investor Percentage and (b) with respect to collections of Principal
Receivables during the Controlled Accumulation Period or the Rapid Amortization
Period, the Fixed Investor Percentage.
"Investor Principal Collections" shall mean, with respect to any
Monthly Period, the sum of (a) the aggregate amount deposited into the Principal
Account for such Monthly Period pursuant to subsections 4.5(a)(ii), (iii) and
(iv), 4.5(b)(ii), (iii) and (iv) or 4.5(c)(ii), in each case, as applicable to
such Monthly Period and (b) the aggregate amount to be treated as Investor
Principal Collections pursuant to subsections 4.9(a)(iii) and 4.11(a), (b), (c),
(d), (g) and (h) for such Monthly Period (other than such amount paid from
Reallocated Principal Collections).
"Investor Servicing Fee shall have the meaning speci fied in subsection
3(a) hereof.
"LIBOR" shall mean, for any Interest Period, the London interbank
offered rate for one-month United States dollar depos its determined by the
Trustee for each Interest Period in accordance with the provisions of Section
4.16.
"LIBOR Determination Date" shall mean September 22, 1998 for the period
from the Closing Date through November 15, 1998, and the second London Business
Day prior to the commencement of the second and each subsequent Interest Period.
"Loan Agreement" shall mean the agreement among the Transferor, the
Servicer, the Trustee, and the Collateral Interest Holder, dated as of the
Closing Date, as amended or modified from time to time.
"London Business Day" shall mean any Business Day on which dealings in
deposits in United States dollars are transacted in the London interbank market.
<PAGE>
14
"Minimum Transferor Interest Percentage" shall mean 7%.
"Monthly Period" shall have the meaning specified in the Agreement,
except that the first Monthly Period with respect to the Investor Certificates
shall begin on and include the Closing Date and shall end on and include October
31, 1998.
"Monthly Principal Payment" shall mean with respect to any Monthly
Period, for all Series (including Series 1998-5) which are in an Amortization
Period or Accumulation Period (as such terms are defined in the related
Supplements for all Series), the sum of (a) the Controlled Distribution Amount
for the related Transfer Date for any Series in its Controlled Amortization
Period (as such terms are defined in the related Supplements for all Series),
(b) the Controlled Deposit Amount for the related Transfer Date for any Series
in its Accumulation Period, other than its Rapid Accumulation Period, if
applicable (as such terms are defined in the related Supplements for all
Series), (c) the Investor Interest as of the end of the prior Monthly Period
taking into effect any payments to be made on the following Distribution Date
for any Series in its Principal Amortization Period or Rapid Amortization Period
(as such terms are defined in the related Supplements for all Series), (d) the
Adjusted Investor Interest as of the end of the prior Monthly Period taking into
effect any payments or deposits to be made on the following Transfer Date and
Distribution Date for any Series in its Rapid Accumulation Period (as such terms
are defined in the related Supplements for all Series), (e) the excess of the
Collateral Interest as of the Transfer Date occurring in such Monthly Period
over the Required Collateral Interest for the related Transfer Date, assuming no
Accumulation Shortfall and (f) such other amounts as may be specified in the
related Supplements for all Series.
"Net Servicing Fee Rate" shall mean 1.0% per annum.
"Pay Out Commencement Date" shall mean the date on which a Trust Pay
Out Event is deemed to occur pursuant to Section 9.1 or a Series 1998-5 Pay Out
Event is deemed to occur pursuant to Section 9 hereof.
"Portfolio Adjusted Yield" shall mean, with respect to any Transfer
Date, the average of the percentages obtained for each of the three preceding
Monthly Periods by subtracting the Base Rate from the Portfolio Yield for such
Monthly Period and deducting 0.5% from the result for each Monthly Period.
"Portfolio Yield" shall mean, with respect to any Monthly Period, the
annualized percentage equivalent of a fraction, the numerator of which is an
amount equal to the sum of (a) the amount of Collections of Finance Charge
Receivables deposited into the Finance Charge Account and allocable to the
Investor Certificates for such Monthly Period,(b) the Principal Funding
Investment Proceeds deposited into the Finance Charge
<PAGE>
15
Account on the Transfer Date related to such Monthly Period and (c) the amount
of the Reserve Draw Amount (up to the Available Reserve Account Amount) plus any
amounts of interest and earnings described in subsections 4.15(b) and (d), each
deposited into the Finance Charge Account on the Transfer Date relating to such
Monthly Period, such sum to be calculated on a cash basis after subtracting the
Aggregate Investor Default Amount for such Monthly Period, and the denominator
of which is the Investor Interest as of the close of business on the last day of
such Monthly Period.
"Principal Funding Account" shall have the meaning set forth in
subsection 4.14(a).
"Principal Funding Account Balance" shall mean, with respect to any
date of determination, the principal amount, if any, on deposit in the Principal
Funding Account on such date of determination.
"Principal Funding Investment Proceeds" shall mean, with respect to
each Transfer Date, the investment earnings on funds in the Principal Funding
Account (net of investment expenses and losses) for the period from and
including the immediately preceding Transfer Date to but excluding such Transfer
Date.
"Principal Funding Investment Shortfall" shall mean, with respect to
each Transfer Date relating to the Controlled Accumulation Period, the amount,
if any, by which the Principal Funding Investment Proceeds for such Transfer
Date are less than the Covered Amount determined as of such Transfer Date.
"Rapid Amortization Period" shall mean the Amortization Period
commencing on the Pay Out Commencement Date and ending on the earlier to occur
of (a) the Series 1998-5 Termination Date and (b) the termination of the Trust
pursuant to Section 12.1.
"Rating Agency" shall mean Moody's, Standard & Poor's and Fitch.
"Reallocated Class B Principal Collections" shall mean, with respect to
any Transfer Date, Collections of Principal Receivables applied in accordance
with subsection 4.12(a) in an amount not to exceed the product of (a) the Class
B Investor Allocation with respect to the Monthly Period relating to such
Transfer Date and (b) the Investor Percentage with respect to the Monthly Period
relating to such Transfer Date and (c) the amount of Collections of Principal
Receivables with respect to the Monthly Period relating to such Transfer Date;
provided however, that such amount shall not exceed the Class B Investor
Interest after giving effect to any Class B Investor Charge-Offs for such
Transfer Date.
<PAGE>
16
"Reallocated Collateral Principal Collections" shall mean, with respect
to any Transfer Date, Collections of Principal Receivables applied in accordance
with subsections 4.12(a) and (b) in an amount not to exceed the product of (a)
the Collateral Allocation with respect to the Monthly Period relating to such
Transfer Date and (b) the Investor Percentage with respect to the Monthly Period
relating to such Transfer Date and (c) the amount of Collections of Principal
Receivables with respect to the Monthly Period relating to such Transfer Date;
provided however, that such amount shall not exceed the Collateral Interest
after giving effect to any Collateral Charge-Offs for such Transfer Date.
"Reallocated Principal Collections" shall mean the sum of (a)
Reallocated Class B Principal Collections and (b) Reallocated Collateral
Principal Collections.
"Reference Banks" shall mean 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.
"Required Collateral Interest" shall mean (a) initial ly, $69,643,524
and (b) on any Transfer Date thereafter, 9.0% of the sum of the Class A Adjusted
Investor Interest, the Class B Investor Interest and the Collateral Interest on
such Transfer Date, after taking into account deposits into the Principal
Funding Account on such Transfer Date and payments to be made on the related
Distribution Date, and the Collateral Interest on the prior Transfer Date, after
any adjustments to be made on such date, but not less than $23,214,286;
provided, however, that (x) if either (i) there is a reduction in the Collateral
Interest pursuant to clause (c), (d) or (e) of the definition of such term or
(ii) a Pay Out Event with respect to the Investor Certificates has occurred, the
Required Collateral Interest for any Transfer Date shall equal the Required
Collateral Interest for the Transfer Date immediately preceding such reduction
or Pay Out Event, (y) in no event shall the Required Collateral Interest exceed
the sum of the outstanding principal amounts of (i) the Class A Certificates and
(ii) the Class B Certificates, each as of the last day of the Monthly Period
preceding such Transfer Date after taking into account the payments to be made
on the related Distribution Date and (z) the Required Collateral Interest may be
reduced at the Transferor's option at any time if the Transferor, the Servicer,
the Collateral Interest Holder and the Trustee have been provided evidence that
the Rating Agency Condition shall have been satisfied with respect to such
reduction.
<PAGE>
17
"Required Reserve Account Amount" shall mean, with respect to any
Transfer Date on or after the Reserve Account Funding Date, an amount equal to
(a) 0.50% of the outstanding principal balance of the Class A Certificates or
(b) any other amount designated by the Transferor; provided, however, that if
such designation is of a lesser amount, the Transferor shall (i) provide the
Servicer, the Collateral Interest Holder and the Trustee with evidence that the
Rating Agency Condition shall have been satisfied and (ii) deliver to the
Trustee a certificate of an authorized officer to the effect that, based on the
facts known to such officer at such time, in the reasonable belief of the
Transferor, 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 1998-5.
"Reserve Account" shall have the meaning specified in subsection
4.15(a).
"Reserve Account Funding Date" shall mean the Transfer Date which
occurs not later than the earliest of (a) the Transfer Date with respect to the
Monthly Period which commences three months prior to the commencement of the
Controlled Accumulation Period; (b) the first Transfer Date for which the
Portfolio Adjusted Yield is less than 2%, but in such event the Reserve Account
Funding Date shall not be required to occur earlier than the Transfer Date with
respect to the Monthly Period which commences 12 months prior to the
commencement of the Controlled Accumulation Period; (c) the first Transfer Date
for which the Portfolio Adjusted Yield is less than 3%, but in such event the
Reserve Account Funding Date shall not be required to occur earlier than the
Transfer Date with respect to the Monthly Period which commences six months
prior to the commencement of the Controlled Accumulation Period; and (d) the
first Transfer Date for which the Portfolio Adjusted Yield is less than 4%, but
in such event the Reserve Account Funding Date shall not be required to occur
earlier than the Transfer Date with respect to the Monthly Period which
commences four months prior to the commencement of the Controlled Accumulation
Period.
"Reserve Account Surplus" shall mean, as of any Trans fer 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" shall have the meaning specified in subsection
4.15(c).
"Revolving Period" shall mean the period from and including the Closing
Date to, but not including, the earlier of (a) the day the Controlled
Accumulation Period commences and (b) the Pay Out Commencement Date.
<PAGE>
18
"Series 1998-5" shall mean the Series of the Chase Credit Card Master
Trust represented by the Investor Certificates.
"Series 1998-5 Certificateholders" shall mean the holder of record of a
Series 1998-5 Certificate.
"Series 1998-5 Certificates" shall mean the Class A Certificates and
the Class B Certificates.
"Series 1998-5 Pay Out Event" shall have the meaning specified in
Section 9 hereof.
"Series 1998-5 Termination Date" shall mean the earli est to occur of
(a) the Distribution Date on which the Investor Interest is paid in full, (b)
the January 2006 Distribution Date and (c) the Trust Termination Date.
"Series Principal Shortfall" shall mean with respect to any Transfer
Date, the excess, if any, of (a) (i) with respect to any Transfer Date relating
to the Controlled Accumulation Period, the sum of (A) the Controlled Deposit
Amount for such Transfer Date, and (B) the excess, if any, of the Collateral
Interest for such Transfer Date over the Required Collateral Interest for such
Transfer Date and (ii) with respect to any Transfer Date during the Rapid
Amortization Period, the Adjusted Investor Interest over (b) the Investor
Principal Collections minus the Reallocated Principal Collections for such
Transfer Date.
"Series Servicing Fee Percentage" shall mean 2.0%.
"Servicer Interchange" shall mean, for any Monthly Period, the portion
of Collections of Finance Charge Receivables allocated to the Investor
Certificates and deposited in the Finance Charge Account with respect to such
Monthly Period that is attributable to Interchange; provided, however, that
Servicer Interchange for a Monthly Period shall not exceed one-twelfth of the
product of (i) the Adjusted Investor Interest as of the last day of such Monthly
Period and (ii) 1.00%.
"Shared Excess Finance Charge Collections" shall mean, with respect to
any Distribution Date, as the context requires, either (x) the amount described
in subsection 4.11(k) allocated to the Series 1998-5 Certificates but available
to cover shortfalls in amounts paid from Collections of Finance Charge
Receivables for other Series, if any or (y) the aggregate amount of Collections
of Finance Charge Receivables allocable to other Series in excess of the amounts
necessary to make required payments with respect to such Series, if any, and
available to cover shortfalls with respect to the Series 1998-5 Certificates.
"Shared Principal Collections" shall mean either (a) the amount
allocated to the Investor Certificates which may be
<PAGE>
19
applied to the Series Principal Shortfall with respect to other outstanding
Series or (b) the amounts allocated to the investor certificates of other Series
which the applicable Supplements for such Series specify are to be treated as
"Shared Principal Collections" and which may be applied to cover the Series
Principal Shortfall with respect to the Investor Certificates.
"Telerate Page 3750" shall mean the display page currently so
designated on the Dow Jones Telerate Service (or such other page as may replace
that page on that service for the purpose of displaying comparable rates or
prices).
"Unallocated Principal Collections" shall have the meaning specified in
subsection 4.5(d).
SECTION I.3. Servicing Compensation and Assignment of Interchange. (a)
The share of the Servicing Fee allocable to Series 1998-5 with respect to any
Transfer Date (the "Investor Servicing Fee") shall be equal to one-twelfth of
the product of (i) the Series Servicing Fee Percentage and (ii) the Adjusted
Investor Interest as of the last day of the Monthly Period preceding such
Transfer Date; provided, however, that with respect to the first Transfer Date,
the Investor Servicing Fee shall be equal to the product of (i) a fraction, the
numerator of which is the number of days from and including the Closing Date to
and including the last day of the October 1998 Monthly Period and the
denominator of which is 360, (ii) 2.0% and (iii) the Investor Interest on the
Closing Date. On each Transfer Date a portion of Interchange with respect to the
related Monthly Period that is on deposit in the Finance Charge Account shall be
with drawn from the Finance Charge Account and paid to the Servicer in payment
of a portion of the Investor Servicing Fee with respect to such Monthly Period
("Servicer Interchange"). Should the Servicer Interchange on deposit in the
Finance Charge Account on any Transfer Date with respect to the related Monthly
Period be less than one-twelfth of 1.00% of the Adjusted Investor Interest as of
the last day of such Monthly Period, the Investor Servicing Fee with respect to
such Monthly Period will not be paid to the extent of such insufficiency of
Servicer Interchange on deposit in the Finance Charge Account. The share of the
Investor Servicing Fee allocable to the Class A Investor Interest with respect
to any Transfer Date (the "Class A Servicing Fee") shall be equal to one-twelfth
of the product of (i) the Class A Floating Allocation, (ii) the Net Servicing
Fee Rate and (iii) the Adjusted Investor Interest as of the last day of the
Monthly Period preceding such Transfer Date; provided, however, that with
respect to the first Transfer Date, the Class A Servicing Fee shall be equal to
the product of (i) the Class A Floating Allocation, (ii) a fraction, the
numerator of which is the number of days from and including the Closing Date to
and including the last day of the October 1998 Monthly Period and the
denominator of which is 360, (iii) the Net Servicing Fee Rate and (iv) the
Investor Interest on the Closing Date. The share of the Investor Servicing Fee
allocable to the Class B Investor Interest with
<PAGE>
20
respect to any Transfer Date (the "Class B Servicing Fee") shall be equal to
one-twelfth of the product of (i) the Class B Floating Allocation, (ii) the Net
Servicing Fee Rate and (iii) the Adjusted Investor Interest as of the last day
of the Monthly Period preceding such Transfer Date; provided, however, that with
respect to the first Transfer Date, the Class B Servicing Fee shall be equal to
the product of (i) the Class B Floating Allocation, (ii) a fraction, the
numerator of which is the number of days from and including the Closing Date to
and including the last day of the October 1998 Monthly Period and the
denominator of which is 360, (iii) the Net Servicing Fee Rate and (iv) the
Investor Interest on the Closing Date. The share of the Investor Servicing Fee
allocable to the Collateral Interest with respect to any Transfer Date (the
"Collateral Interest Servicing Fee") shall be equal to one-twelfth of the
product of (i) the Collateral Floating Allocation, (ii) the Net Servicing Fee
Rate and (iii) the Adjusted Investor Interest as of the last day of the Monthly
Period preceding such Transfer Date; provided, however, that with respect to the
first Transfer Date, the Collateral Interest Servicing Fee shall be equal to the
product of (i) the Class C Floating Allocation, (ii) a fraction, the numerator
of which is the number of days from and including the Closing Date to and
including the last day of the October 1998 Monthly Period and the denominator of
which is 360, (iii) the Net Servicing Fee Rate and (iv) the Investor Interest on
the Closing Date. Except as specifically provided above, the Servicing Fee shall
be paid by the cash flows from the Trust allocated to the Transferor or the
certificateholders of other Series (as provided in the related Supplements) and
in no event shall the Trust, the Trustee or the Investor Certificateholders be
liable therefor. The Class A Servicing Fee shall be payable to the Servicer
solely to the extent amounts are available for distribution in respect thereof
pursuant to subsections 4.9(a)(ii) and 4.11(a). The Class B Servicing Fee shall
be payable solely to the extent amounts are available for distribution in
respect thereof pursuant to subsections 4.9(b)(ii) and 4.11(c). The Collateral
Interest Servicing Fee shall be payable solely to the extent amounts are
available for distribution in respect thereof pursuant to subsection 4.11(f) or,
if applicable, subsection 4.9(c)(i).
(b) On or before each Transfer Date, the Transferor shall notify the
Servicer of the amount of Interchange to be included as Collections of Finance
Charge Receivables and allocable to the Investor Certificateholders with respect
to the preceding Monthly Period as determined pursuant to this subsection 3(b).
Such amount of Interchange shall be equal to the product of (i) the aggregate
amount of Interchange with respect to such Monthly Period and (ii) the Investor
Percentage with respect to Finance Charge Receivables for such Monthly Period.
On each Transfer Date, the Transferor shall pay to the Servicer, and the
Servicer shall deposit into the Finance Charge Account, in immediately available
funds, the amount of Interchange to be so included as Collections of Finance
Charge
<PAGE>
21
Receivables allocable to the Investor Certificates with respect to the preceding
Monthly Period.
SECTION I.4. Reassignment and Transfer Terms. The Investor Certificates
shall be subject to retransfer to the Transferor at its option, in accordance
with the terms specified in subsection 12.2(a), on any Distribution Date on or
after the Distribution Date on which the Investor Interest is reduced to an
amount less than or equal to 5% of the Initial Investor Interest. The deposit
required in connection with any such repurchase shall include the amount, if
any, on deposit in the Principal Funding Account and will be equal to the sum of
(a) the Investor Interest and (b) accrued and unpaid interest on the Investor
Certificates through the day preceding the Distribution Date on which the
repurchase occurs.
SECTION I.5. Delivery and Payment for the Investor Certificates. The
Transferor shall execute and deliver the Series 1998-5 Certificates to the
Trustee for authentication in accordance with Section 6.1. The Trustee shall
deliver such Certificates when authenticated in accordance with Section 6.2.
SECTION I.6. Depository; Form of Delivery of Investor Certificates.
(a) The Class A Certificates and the Class B Certificates shall be
delivered as Book-Entry Certificates as provided in Sections 6.1 and 6.10.
(b) The Depository for Series 1998-5 shall be The Depository Trust
Company, and the Class A Certificates and Class B Certificates shall be
initially registered in the name of Cede & Co., its nominee.
SECTION I.7. Article IV of Agreement. Sections 4.1, 4.2 and 4.3 shall
be read in their entirety as provided in the Agreement. Article IV (except for
Sections 4.1, 4.2 and 4.3 thereof) shall be read in its entirety as follows and
shall be applicable only to the Investor Certificates:
ARTICLE IV
RIGHTS OF CERTIFICATEHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION IV.1. Rights of Certificateholders and the Collateral Interest
Holder. The Investor Certificates shall represent undivided interests in the
Trust, consisting of the right to receive, to the extent necessary to make the
required payments with respect to such Investor Certificates at the times and in
the amounts specified in this Agreement, (a) the Floating Investor Percentage
and Fixed Investor Percentage (as applicable from time to time) of Collections
received with respect to the Receivables and (b) funds on deposit in the
Collection Account,
<PAGE>
22
the Finance Charge Account, the Excess Funding Account, the Principal Account,
the Principal Funding Account, the Reserve Account and the Distribution Account.
The Collateral Interest shall be subordinate to the Class A Certificates and the
Class B Certificates. The Class B Certificates shall be subordinate to the Class
A Certificates. The Transferor Certificate shall not represent any interest in
the Collection Account, the Finance Charge Account, the Principal Account, the
Excess Funding Account, the Principal Funding Account, the Reserve Account or
the Distribution Account, except as specifically provided in this Article IV.
SECTION IV.2. Allocations.
(a) Allocations During the Revolving Period. During the Revolving
Period, the Servicer shall, prior to the close of business on the day any
Collections are deposited in the Collection Account, allocate to the Investor
Certificateholders or the Holder of the Transferor Certificate and pay or
deposit from the Collection Account the following amounts as set forth below:
(i) Deposit into the Finance Charge Account an amount equal to the
product of (A) the Investor Percentage on the Date of Processing of such
Collections and (B) the aggregate amount of Collections processed in respect
of Finance Charge Receivables on such Date of Processing to be applied in
accordance with Section 4.9.
(ii) Deposit into the Principal Account an amount equal to the product
of (A) the Collateral Allocation on the Date of Processing of such
Collections, (B) the Investor Percentage on the Date of Processing of such
Collections and (C) the aggregate amount of Collections processed in respect
of Principal Receivables on such Date of Processing to be applied first in
accordance with Section 4.12 and then in accordance with subsection 4.9(d).
(iii) Deposit into the Principal Account an amount equal to the product
of (A) the Class B Investor Allocation on the Date of Processing of such
Collections, (B) the Investor Percentage on the Date of Processing of such
Collections and (C) the aggregate amount of Collections processed in respect
of Principal Receivables on such Date of Processing to be applied first in
accordance with Section 4.12 and then in accordance with subsection 4.9(d).
(iv) (A) Deposit into the Principal Account an amount equal to the
product of (1) the Class A Investor Allocation on the Date of Processing of
such Collections, (2) the Investor Percentage on the Date of Processing of
such Collections and (3) the aggregate amount of Collections processed in
respect of Principal Receivables on such Date of Processing; provided,
however, that the amount deposited
<PAGE>
23
into the Principal Account pursuant to this subsection 4.5(a)(iv)(A) shall
not exceed the Daily Principal Shortfall, and (B) pay to the Holder of the
Transferor Certificate an amount equal to the excess, if any, identified in
the proviso to clause (A) above; provided, however, that the amount to be
paid to the Holder of the Transferor Certificate pursuant to this subsection
4.5(a)(iv)(B) with respect to any Date of Processing shall be paid to the
Holder of the Transferor Certificate only if the Transferor Interest on such
Date of Processing is greater than the Minimum Transferor Interest (after
giving effect to the inclusion in the Trust of all Receivables created on or
prior to such Date of Processing and the application of payments referred to
in subsection 4.3(b)) and otherwise shall be deposited into the Excess
Funding Account.
(b) Allocations During the Controlled Accumulation Period. During the
Controlled Accumulation Period, the Servicer shall, prior to the close of
business on the day any Collections are deposited in the Collection Account,
allocate to the Investor Certificateholders or the Holder of the Transferor
Certificate and pay or deposit from the Collection Account the following amounts
as set forth below:
(i) Deposit into the Finance Charge Account an amount equal to the
product of (A) the Investor Percentage on the Date of Processing of such
Collections and (B) the aggregate amount of Collections processed in respect
of Finance Charge Receivables on such Date of Processing to be applied in
accordance with Section 4.9.
(ii) Deposit into the Principal Account an amount equal to the product
of (A) the Collateral Allocation on the Date of Processing of such
Collections, (B) the Investor Percentage on the Date of Processing of such
Collections and (C) the aggregate amount of Collections processed in respect
of Principal Receivables on such Date of Processing to be applied first in
accordance with Section 4.12 and then in accordance with subsection 4.9(e).
(iii) Deposit into the Principal Account an amount equal to the product
of (A) the Class B Investor Allocation on the Date of Processing of such
Collections, (B) the Investor Percentage on the Date of Processing of such
Collections and (C) the aggregate amount of Collections processed in respect
of Principal Receivables on such Date of Processing to be applied first in
accordance with Section 4.12 and then in accordance with subsection 4.9(e).
(iv) (A) Deposit into the Principal Account an amount equal to the
product of (1) the Class A Investor Allocation on the Date of Processing of
such Collections, (2) the Investor Percentage on the Date of Processing of
such
<PAGE>
24
Collections and (3) the aggregate amount of Collections processed in respect
of Principal Receivables on such Date of Processing; provided, however, that
the amount deposited into the Principal Account pursuant to this subsection
4.5(b)(iv)(A) shall not exceed the Daily Principal Shortfall, and (B) pay to
the Holder of the Transferor Certificate an amount equal to the excess, if
any, identified in the proviso to clause (A) above; provided, however, that
the amount to be paid to the Holder of the Transferor Certificate pursuant
to this subsection 4.5(b)(iv)(B) with respect to any Date of Processing
shall be paid to the Holder of the Transferor Certificate only if the
Transferor Interest on such Date of Processing is greater than the Minimum
Transferor Interest (after giving effect to the inclusion in the Trust of
all Receivables created on or prior to such Date of Processing and the
application of payments referred to in subsection 4.3(b)) and otherwise
shall be deposited into the Excess Funding Account.
(c) Allocations During the Rapid Amortization Period. During the Rapid
Amortization Period, the Servicer shall, prior to the close of business on the
day any Collections are deposited in the Collection Account, allocate to the
Investor Certificateholders and pay or deposit from the Collection Account the
following amounts as set forth below:
(i) Deposit into the Finance Charge Account an amount equal to the
product of (A) the Investor Percentage on the Date of Processing of such
Collections and (E) the aggregate amount of Collections processed in respect
of Finance Charge Receivables on such Date of Processing to be applied in
accordance with Section 4.9.
(ii) (A) Deposit into the Principal Account an amount equal to the
product of (1) the Investor Percentage on the Date of Processing of such
Collections and (2) the aggregate amount of Collections processed in respect
of Principal Receivables on such Date of Processing; provided, however, that
the amount deposited into the Principal Account pursuant to this subsection
4.5(c)(ii)(A) shall not exceed the sum of the Investor Interest as of the
close of business on the last day of the prior Monthly Period (after taking
into account any payments to be made on the Distribution Date relating to
such prior Monthly Period and deposits and any adjustments to be made to the
Investor Interest to be made on the Transfer Date relating to such Monthly
Period) and any Reallocated Principal Collections relating to the Monthly
Period in which such deposit is made and (B) pay to the Holder of the
Transferor Certificate an amount equal to the excess, if any, identified in
the proviso to clause (A) above; provided, however, that the amount to be
paid to the Holder of the Transferor Certificate pursuant to this subsection
4.5(c)(ii)(B) with respect to any Date of
<PAGE>
25
Processing shall be paid to the Holder of the Transferor Certificate only if
the Transferor Interest on such Date of Processing is greater than the
Minimum Transferor Interest (after giving effect to the inclusion in the
Trust of all Receivables created on or prior to such Date of Processing and
the application of payments referred to in subsection 4.3(b)) and otherwise
shall be deposited into the Excess Funding Account.
(d) Limitation on Required Deposits. With respect to the Investor
Certificates, and notwithstanding anything in the Agreement or this Series
Supplement to the contrary, whether or not the Servicer is required to make
monthly or daily deposits from the Collection Account into the Finance Charge
Account or the Principal Account pursuant to subsections 4.5(a), 4.5(b) and
4.5(c), with respect to any Monthly Period (i) the Servicer will only be
required to deposit Collections from the Collection Account into the Finance
Charge Account or the Principal Account in an amount equal to the lesser of (x)
the amount required to be deposited into any such deposit account pursuant to
subsection 4.5(a), 4.5(b) or 4.5(c) and (y) the amount required to be
distributed on or prior to the related Distribution Date to the Investor
Certificateholders 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. To the extent
that, in accordance with this subsection 4.5(d), the Servicer has retained
amounts which would otherwise be required to be deposited in the Finance Charge
Account or the Principal Account with respect to any Monthly Period, the
Servicer shall be required to deposit such amounts in the Finance Charge Account
or the Principal Account on the related Transfer Date to the extent necessary to
make required distributions to the Investor Certificateholders on the related
Distribution Date, including any amounts which are required to be applied as
Reallocated Principal Collections.
For so long as the Servicer shall (i) satisfy the conditions specified
in the third paragraph of subsection 4.3(a) of the Agreement and (ii) be making
deposits to the Principal Account and Finance Charge Account on a monthly basis,
all requirements herein to deposit amounts on a daily basis shall be deemed to
be satisfied to the extent that the required monthly deposit is made and all
references to amounts on deposit in such accounts shall be deemed to include
amounts which would otherwise have been deposited therein on a daily basis.
SECTION IV.3. Determination of Monthly Interest.
(a) The amount of monthly interest distributable to the Class A
Certificates 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
<PAGE>
26
which is 360, times (B) (i) the Class A Certificate Rate in effect with respect
to the related Interest Period, and (ii) the outstanding principal balance of
the Class A Certificates determined as of the close of business on the
Distribution Date preceding the related Transfer Date (after giving effect to
all of the transactions occurring on such date) (the "Class A Monthly
Interest"); provided, however, that with respect to the first Distribution Date,
Class A Monthly Interest will include, accrued interest at the Class A
Certificate Rate from the Closing Date through November 15, 1998; provided,
further, that in addition to Class A Monthly Interest an amount equal to the
amount of any unpaid Class A Deficiency Amounts, as defined below, plus an
amount equal to the product of (A) (1) 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 (2) the sum of the Class A Certificate Rate in effect with
respect to the related Interest Period, plus 2% per annum, and (B) any Class A
Deficiency Amount from the prior Transfer Date, as defined below (or the portion
thereof which has not theretofore been paid to Class A Certificateholders) (the
"Class A Additional Interest") shall also be distributable to the Class A
Certificates, and on such Transfer Date the Trustee shall deposit such funds, to
the extent available, into the Distribution Account. The "Class A Deficiency
Amount" for any Transfer Date shall be equal to the excess, if any, of the
aggregate amount accrued pursuant to this subsection 4.6(a) as of the prior
Interest Period over the amount actually transferred to the Distribution Account
for payment of such amount.
(b) The amount of monthly interest distributable to the Class B
Certificates 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 Certificate Rate in
effect with respect to the related Interest Period and (ii) the outstanding
principal balance of the Class B Certificates determined as of the close of
business on the Distribution Date preceding the related Transfer Date (after
giving effect to all of the transactions occurring on such date) (the "Class B
Monthly Interest"); provided, however, that with respect to the first
Distribution Date, Class B Monthly Interest will include accrued interest at the
Class B Certificate Rate from the Closing Date through November 15, 1998;
provided, further, that in addition to the Class B Monthly Interest an amount
equal to the amount of any unpaid Class B Deficiency Amounts, as defined below,
plus an amount equal to the product of (A) (1) 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 (2) the sum of the Class B Certificate Rate
in effect with respect to the related Interest Period, plus 2% per annum, and
(B) any Class B Deficiency Amount from the prior Transfer Date, as defined below
(or the portion thereof which has not theretofore been paid to Class B
Certificateholders) (the "Class B Additional Interest") shall also be
distributable to the Class B Certificates, and on
<PAGE>
27
such Transfer Date the Trustee shall deposit such funds, to the extent
available, into the Distribution Account. The "Class B Deficiency Amount" for
any Transfer Date shall be equal to the excess, if any, of the aggregate amount
accrued pursuant to this subsection 4.6(b) as of the prior Interest Period over
the amount actually transferred to the Distribution Account for payment of such
amount.
(c) The amount of monthly interest distributable to the Collateral
Interest, which 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 Collateral Rate in
effect with respect to the related Interest Period, and (ii) the Collateral
Interest determined as of the close of business on the Distribution Date
preceding the related Transfer Date (after giving effect to all of the
transactions occurring on such date) (the "Collateral Monthly Interest");
provided, however, that for the purposes of determining Collateral Monthly
Interest only, the Collateral Rate shall not exceed a per annum rate of 1% in
excess of LIBOR as determined on the related LIBOR Determination Date.
SECTION IV.4. Determination of Monthly Principal.
(a) The amount of monthly principal distributable from the Principal
Account with respect to the Class A Certificates on each Transfer Date ("Class A
Monthly Principal"), beginning with the Transfer 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
Investor Principal Collections on deposit in the Principal Account with respect
to such Transfer Date, (ii) for each Transfer Date with respect to the
Controlled Accumulation Period prior to the Class A Scheduled Payment Date, the
Controlled Deposit Amount for such Transfer Date and (iii) the Class A Adjusted
Investor Interest on such Transfer Date prior to any deposit into the Principal
Funding Account to be made on such day.
(b) The amount of monthly principal distributable from the Principal
Account with respect to the Class B Certificates on each Transfer Date (the
"Class B Monthly Principal"), for the Controlled Accumulation Period, beginning
with the Transfer Date following the Monthly Period in which the Class A
Investor Interest has been paid in full, and during the Rapid Amortization
Period, beginning with the Transfer Date immediately preceding the Distribution
Date on which the Class A Investor Interest has been paid in full, shall be an
amount equal to the lesser of (i) the Available Investor Principal Collections
on deposit in the Principal Account with respect to such Transfer Date (minus
the portion of such Available Investor Principal Collections applied to Class A
Monthly Principal on such Transfer Date) and (ii) the Class B Investor Interest
(after taking into account any
<PAGE>
28
adjustments to be made on such Transfer Date pursuant to Sections 4.10 and 4.12)
on such Transfer Date.
(c) The amount of monthly principal (the "Collateral Monthly
Principal") distributable from the Principal Account with respect to the
Collateral Interest on each Transfer Date shall be (A) during the Revolving
Period following any reduction of the Required Collateral Interest pursuant to
clause (z) of the proviso in the definition thereof an amount equal to the
lesser of (1) the excess, if any, of the Collateral Interest (after taking into
account any adjustments to be made on such Transfer Date pursuant to Sections
4.10 and 4.12) over the Required Collateral Interest on such Transfer Date and
(2) the Available Investor Principal Collections on such Transfer Date or (B)
during the Controlled Accumulation Period or Rapid Amortization Period, an
amount equal to the lesser of (1) the excess, if any, of the Collateral Interest
(after taking into account any adjustments to be made on such Transfer Date
pursuant to Sections 4.10 and 4.12) over the Required Collateral Interest on
such Transfer Date and (2) the excess, if any, of (i) the Available Investor
Principal Collections on such Transfer Date over (ii) the sum of the Class A
Monthly Principal and the Class B Monthly Principal for such Transfer Date.
SECTION IV.5. Coverage of Required Amount. (a) On or before each
Transfer Date, the Servicer shall determine the amount (the "Class A Required
Amount"), if any, by which the sum of (i) the Class A Monthly Interest for such
Transfer Date, plus (ii) the Class A Deficiency Amount, if any, for such
Transfer Date, plus (iii) the Class A Additional Interest, if any, for such
Transfer Date, plus (iv) the Class A Servicing Fee for the prior Monthly Period
plus (v) the Class A Servicing Fee, if any, due but not paid on any prior
Transfer Date, plus (vi) the Class A Investor Default Amount, if any, for the
prior Monthly Period, exceeds the Class A Available Funds for the related
Monthly Period.
(b) On or before each Transfer Date, the Servicer shall also determine
the amount (the "Class B Required Amount"), if any, equal to the sum of (i) the
amount, if any, by which the sum of (A) the Class B Monthly Interest for such
Transfer Date, plus (B) the Class B Deficiency Amount, if any, for such Transfer
Date plus (C) the Class B Additional Interest, if any, for such Transfer Date,
plus (D) the Class B Servicing Fee for the prior Monthly Period plus (E) the
Class B Servicing Fee, if any, due but not paid on any prior Transfer Date,
exceeds the Class B Available Funds for the related Monthly Period plus (ii) the
Class B Investor Default Amount, if any, for the prior Monthly Period.
(c) In the event that the sum of the Class A Required Amount and the
Class B Required Amount for such Transfer Date is greater than zero, the
Servicer shall give written notice to the Trustee of such positive Class A
Required Amount or Class B
<PAGE>
29
Required Amount on or before such Transfer Date. In the event that the Class A
Required Amount for such Transfer Date is greater than zero, all or a portion of
the Excess Spread and Shared Excess Finance Charge Collections allocable to
Series 1998-5 with respect to such Transfer Date in an amount equal to the Class
A Required Amount, to the extent available, for such Transfer Date shall be
distributed from the Finance Charge Account on such Transfer Date pursuant to
subsection 4.11(a). In the event that the Class A Required Amount for such
Transfer Date exceeds the amount of Excess Spread and Shared Excess Finance
Charge Collections allocable to Series 1998-5 with respect to such Transfer
Date, the Collections of Principal Receivables allocable to the Collateral
Interest and the Collections of Principal Receivables allocable to the Class B
Certificates with respect to the prior Monthly Period shall be applied as
specified in Section 4.12. In the event that the Class B Required Amount for
such Transfer Date exceeds the amount of Excess Spread and Shared Excess Finance
Charge Collections allocable to Series 1998-5 available to fund the Class B
Required Amount pursuant to subsection 4.11(c), the Collections of Principal
Receivables allocable to the Collateral Interest (after application to the Class
A Required Amount) shall be applied as specified in Section 4.12; provided,
however, that the sum of any payments pursuant to this paragraph shall not
exceed the sum of the Class A Required Amount and Class B Required Amount.
SECTION IV.6. Monthly Payments. On or before each Transfer Date, the
Servicer shall instruct the Trustee in writing (which writing shall be
substantially in the form of Exhibit B hereto) to withdraw and the Trustee,
acting in accordance with such instructions, shall withdraw on such Transfer
Date or the related Distribution Date, as applicable, to the extent of available
funds, the amounts required to be withdrawn from the Finance Charge Account, the
Principal Account, the Principal Funding Account and the Distribution Account as
follows:
(a) An amount equal to the Class A Available Funds deposited into the
Finance Charge Account for the related Monthly Period shall be distributed on
each Transfer Date in the following priority:
(i) an amount equal to Class A Monthly Interest for such Transfer Date,
plus the amount of any Class A Deficien cy Amount for such Transfer Date,
plus the amount of any Class A Additional Interest for such Transfer Date,
shall be deposited by the Servicer or the Trustee into the Distribution
Account;
(ii) an amount equal to the Class A Servicing Fee for such Transfer
Date plus the amount of any Class A Servicing Fee due but not paid to the
Servicer on any prior Transfer Date shall be distributed to the Servicer;
<PAGE>
30
(iii) an amount equal to the Class A Investor Default Amount, if any,
for the preceding Monthly Period shall be treated as a portion of Investor
Principal Collections and deposited into the Principal Account on such
Transfer Date; and
(iv) the balance, if any, shall constitute Excess Spread and shall be
allocated and distributed as set forth in Section 4.11.
(b) An amount equal to the Class B Available Funds deposited into the
Finance Charge Account for the related Monthly Period shall be distributed on
each Transfer Date in the following priority:
(i) an amount equal to the Class B Monthly Interest for such Transfer
Date, plus the amount of any Class B Deficiency Amount for such Transfer
Date, plus the amount of any Class B Additional Interest for such Transfer
Date, shall be deposited by the Servicer or the Trustee into the
Distribution Account;
(ii) an amount equal to the Class B Servicing Fee for such Transfer
Date, plus the amount of any Class B Servicing Fee due but not paid to the
Servicer on any prior Transfer Date for such Transfer Date shall be
distributed to the Servicer; and
(iii) the balance, if any, shall constitute Excess Spread and shall be
allocated and distributed as set forth in Section 4.11.
(c) An amount equal to the Collateral Available Funds deposited into
the Finance Charge Account for the related Monthly Period shall be distributed
on each Transfer Date in the following priority:
(i) if none of the Transferor, an Affiliate thereof or the Trustee is
the Servicer, an amount equal to the Collateral Interest Servicing Fee for
such Transfer Date plus the amount of any Collateral Interest Servicing Fee
due but not paid to the Servicer on any prior Transfer Date shall be
distributed to the Servicer; and
(ii) the balance, if any, shall constitute Excess Spread and shall be
allocated and distributed as set forth in Section 4.11.
(d) During the Revolving Period, an amount equal to the Available
Investor Principal Collections deposited into the Principal Account for the
related Monthly Period shall be distributed on each Transfer Date in the
following priority:
<PAGE>
31
(i) an amount equal to the Collateral Monthly Principal for such
Transfer Date shall be distributed to the Collateral Interest Holder in
accordance with the Loan Agreement;
(ii) an amount equal to the lesser of (A) the product of (1) a
fraction, the numerator of which is equal to the Available Investor
Principal Collections remaining after the application specified in
subsection 4.9(d)(i) above and the denominator of which is equal to the sum
of the Available Investor Principal Collections available for sharing as
specified in the related Supplement for each Series and (2) the Cumulative
Series Principal Shortfall and (B) Available Investor Principal Collections,
shall remain in the Principal Account to be treated as Shared Principal
Collections and applied to Series other than this Series 1998-5; and
(iii) an amount equal to the excess, if any, of (A) the Available
Investor Principal Collections for such Transfer Date over (B) the
applications specified in subsections 4.9(d)(i) and (ii) above shall be paid
to the Holder of the Transferor Certificate; provided, however, that the
amount to be paid to the Holder of the Transferor Certificate pursuant to
this subsection 4.9(d)(iii) with respect to such Transfer Date shall be paid
to the Holder of the Transferor Certificate only if the Transferor Interest
on such Date of Processing is greater than the Minimum Transferor Interest
(after giving effect to the inclusion in the Trust of all Receivables
created on or prior to such Transfer Date and the application of payments
referred to in subsection 4.3(b)) and otherwise deposited into the Excess
Funding Account.
(e) During the Controlled Accumulation Period or the Rapid Amortization
Period, an amount equal to the Available Investor Principal Collections
deposited into the Principal Account for the related Monthly Period shall be
distributed on each Transfer Date in the following priority:
(i) an amount equal to the Class A Monthly Principal for such Transfer
Date, shall be (A) during the Controlled Accumulation Period, deposited into
the Principal Funding Account, and (B) during the Rapid Amortization Period,
deposited into the Distribution Account;
(ii) after giving effect to the distribution referred to in clause (i)
above, an amount equal to the Class B Monthly Principal, shall be deposited
into the Distribution Account;
(iii) for each Transfer Date (other than the Transfer Date immediately
preceding the Series 1998-5 Termination Date, in which case on the Series
1998-5 Termination Date)
<PAGE>
32
after giving effect to the distribution referred to in clauses (i) and (ii)
above, an amount equal to Collateral Monthly Principal shall be distributed
to the Collateral Interest Holder in accordance with the Loan Agreement;
(iv) an amount equal to the lesser of (A) the product of (1) a
fraction, the numerator of which is equal to the Available Investor
Principal Collections remaining after the application specified in
subsections 4.9(e)(i), (ii) and (iii) above and the denominator of which is
equal to the sum of the Available Investor Principal Collections available
for sharing as specified in the related Series Supplement for each Series
and (2) the Cumulative Series Principal Shortfall and (B) the Available
Investor Principal Collections, shall remain in the Principal Account to be
treated as Shared Principal Collections and applied to Series other than
this Series 1998-5; and
(v) an amount equal to the excess, if any, of (A) the Available
Investor Principal Collections over (B) the applications specified in
subsections 4.9(e)(i) through (iv) above shall be paid to the Holder of the
Transferor Certificate; provided, however, that the amount to be paid to the
Holder of the Transferor Certificate pursuant to this subsection 4.9(e)(v)
with respect to such Transfer Date shall be paid to the Holder of the
Transferor Certificate only if the Transferor Interest on such Date of
Processing is greater than the Minimum Transferor Interest (after giving
effect to the inclusion in the Trust of all Receivables created on or prior
to such Transfer Date and the application of payments referred to in
subsection 4.3(b)) and otherwise shall be deposited into the Excess Funding
Account.
(f) on the earlier to occur of (i) the first Transfer Date with respect
to the Rapid Amortization Period and (ii) the Transfer Date immediately
preceding the Class A Scheduled Payment Date, the Trustee, acting in accordance
with instructions from the Servicer, shall withdraw from the Principal Funding
Account and deposit in the Distribution Account the amount on deposit in the
Principal Funding Account.
(g) On each Distribution Date, the Trustee shall pay in accordance with
subsection 5.1(a) to the Class A Certificateholders from the Distribution
Account, the amount deposited into the Distribution Account pursuant to
subsection 4.9(a)(i) on the preceding Transfer Date and (b) to the Class B
Certificateholders from the Distribution Account, the amount deposited into the
Distribution Account pursuant to subsection 4.9(b)(i) on the preceding Transfer
Date.
(h) On the earlier to occur of (i) the first Distribution Date with
respect to the Rapid Amortization Period and (ii) the Class A Scheduled Payment
Date and on each
<PAGE>
33
Distribution Date thereafter, the Trustee, acting in accordance with
instructions from the Servicer, shall pay in accordance with Section 5.1 from
the Distribution Account the amount so deposited into the Distribution Account
pursuant to subsections 4.9(e) and (f) on the related Transfer Date in the
following priority:
(i) an amount equal to the lesser of such amount on deposit in the
Distribution Account and the Class A Investor Interest shall be paid to the
Class A Certificateholders; and
(ii) for each Distribution Date with respect to the Rapid Amortization
Period and on the Class B Scheduled Payment Date, after giving effect to the
distributions referred to in clause (i) above, an amount equal to the lesser
of such amount on deposit in the Distribution Account and the Class B
Investor Interest shall be paid to the Class B Certificateholders.
(i) The Controlled Accumulation Period is scheduled to commence at the
close of business on August 31, 2002; provided, however, that, if the
Accumulation Period Length (determined as described below) is less than 12
months, the date on which the Controlled Accumulation Period actually commences
will be delayed to the first Business Day of the month that is the number of
whole months prior to the Class A Scheduled Payment 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 June 2002 Determination 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; provid ed, however, that the Accumulation Period Length will not
be determined to be less than one month.
SECTION IV.7. Investor Charge-Offs.
(a) On or before each Transfer Date, the Servicer shall calculate the
Class A Investor Default Amount. If on any Transfer Date, the Class A Investor
Default Amount for the prior Monthly Period exceeds the sum of the amount
allocated with respect thereto pursuant to subsection 4.9(a)(iii), subsection
4.11(a) and Section 4.12 with respect to such Monthly Period, the Collateral
Interest (after giving effect to reductions for any Collateral Charge-offs and
any Reallocated Principal Collections on such Transfer Date) will be reduced by
the amount of such excess, but not by more than the lesser of the Class A
Investor Default Amount and the Collateral Interest (after giving effect to
reductions for any Collateral Charge-Offs and any Reallocated Principal
Collections on such Transfer Date) for such Transfer
<PAGE>
34
Date. In the event that such reduction would cause the Collateral Interest to be
a negative number, the Collateral Interest will be reduced to zero, and the
Class B Investor Interest (after giving effect to reductions for any Class B
Investor Charge-Offs and any Reallocated Class B Principal Collections on such
Trans fer Date) will be reduced by the amount by which the Collateral Interest
would have been reduced below zero. In the event that such reduction would cause
the Class B Investor Interest to be a negative number, the Class B Investor
Interest will be reduced to zero, and the Class A Investor Interest will be
reduced by the amount by which the Class B Investor Interest would have been
reduced below zero, but not by more than the Class A Investor Default Amount for
such Transfer Date (a "Class A Investor Charge-Off"). If the Class A Investor
Interest has been reduced by the amount of any Class A Investor Charge-Offs, it
will be reimbursed on any Transfer Date (but not by an amount in excess of the
aggregate Class A Investor Charge-Offs) by the amount of Excess Spread and
Shared Excess Finance Charge Collections allocable to Series 1998-5 allocated
and available for such purpose pursuant to subsection 4.11(b).
(b) On or before each Transfer Date, the Servicer shall calculate the
Class B Investor Default Amount. If on any Transfer Date, the Class B Investor
Default Amount for the prior Monthly Period exceeds the amount of Excess Spread
and Shared Excess Finance Charge Collections allocable to Series 1998-5 and
Reallocated Collateral Principal Collections which are allocated and available
to fund such amount pursuant to subsection 4.11(c) and Section 4.12, the
Collateral Interest (after giving effect to reductions for any Collateral
Charge-Offs and any Reallocated Principal Collections on such Transfer Date and
any adjustments with respect thereto as described in subsection 4.10(a) above)
will be reduced by the amount of such excess but not by more than the lesser of
the Class B Investor Default Amount and the Collateral Interest (after giving
effect to reductions for any Collateral Charge-Offs and any Reallocated
Principal Collections on such Transfer Date and any adjustments with respect
thereto as described in subsection 4.10(a) above) for such Transfer Date. In the
event that such reduction would cause the Collateral Interest to be a negative
number, the Collateral Interest shall be reduced to zero and the Class B
Investor Interest shall be reduced by the amount by which the Collateral
Interest would have been reduced below zero, but not by more than the Class B
Investor Default Amount for such Transfer Date (a "Class B Investor
Charge-Off"). The Class B Investor Interest will also be reduced by the amount
of Reallocated Class B Principal Collections in excess of the Collateral
Interest pursuant to Section 4.12 and the amount of any portion of the Class B
Investor Interest allocated to the Class A Certificates to avoid a reduction in
the Class A Investor Interest pursuant to subsection 4.10(a) above. The Class B
Investor Interest will thereafter be reimbursed (but not to an amount in excess
of the unpaid principal balance of the Class B Certificates) on any Transfer
Date by the amount of Excess Spread and Shared Excess
<PAGE>
35
Finance Charge Collections allocable to Series 1998-5 allocated and available
for that purpose as described under subsection 4.11(d).
(c) On or before each Transfer Date, the Servicer shall calculate the
Collateral Default Amount. If on any Transfer Date, the Collateral Default
Amount for the prior Monthly Period exceeds the amount of Excess Spread and
Shared Excess Finance Charge Collections allocable to Series 1998-5 allocated
and available to fund such amount pursuant to subsection 4.11(g), the Collateral
Interest will be reduced by the amount of such excess but not by more than the
lesser of the Collateral Default Amount and the Collateral Interest for such
Transfer Date (a "Collateral Charge-Off"). The Collateral Interest will also be
reduced by the amount of Reallocated Principal Collections pursuant to Section
4.12 and the amount of any portion of the Collateral Interest allocated to the
Class A Certificates or the Class B Certificates to avoid a reduction in the
Class A Investor Interest, pursuant to subsection 4.10(a), or the Class B
Investor Interest, pursuant to subsection 4.10(b), respectively. The Collateral
Interest will thereafter be reimbursed on any Transfer Date by the amount of the
Excess Spread and Shared Excess Finance Charge Collections allocable to Series
1998-5 allocated and available for that purpose as described under subsection
4.11(h).
SECTION IV.8. Excess Spread. On or before each Trans fer Date, the
Servicer shall instruct the Trustee in writing (which writing shall be
substantially in the form of Exhibit B hereto) to apply Excess Spread with
respect to the related Monthly Period to make the following distributions on
each Transfer Date in the following priority:
(a) an amount equal to the Class A Required Amount, if any, with
respect to such Transfer Date shall be used to fund the Class A Required Amount
and be applied in accordance with, and in the priority set forth in, subsection
4.9(a);
(b) an amount equal to the aggregate amount of Class A Investor
Charge-Offs which have not been previously reimbursed shall be treated as a
portion of Investor Principal Collections and deposited into the Principal
Account on such Transfer Date;
(c) an amount equal to the Class B Required Amount, if any, with
respect to such Transfer Date shall be used to fund the Class B Required Amount
and be applied first in accordance with, and in the priority set forth in,
subsection 4.9(b) and then any remaining amount available to pay the Class B
Investor Default Amount shall be treated as a portion of Investor Principal
Collections and deposited into the Principal Account on such Transfer Date;
(d) an amount equal to the aggregate amount by which the Class B
Investor Interest has been reduced below the initial
<PAGE>
36
Class B Investor Interest for reasons other than the payment of principal to the
Class B Certificateholders (but not in excess of the aggregate amount of such
reductions which have not been previously reimbursed) shall be treated as a
portion of Investor Principal Collections and deposited into the Principal
Account on such Transfer Date;
(e) an amount equal to the Collateral Monthly Interest plus the amount
of any past due Collateral Monthly Interest for such Transfer Date shall be paid
to the Collateral Interest Holder in accordance with the Loan Agreement;
(f) an amount equal to the aggregate amount of accrued but unpaid
Collateral Interest Servicing Fees shall be paid to the Servicer;
(g) an amount equal to the Collateral Default Amount, if any, for the
prior Monthly Period shall be treated as a portion of Investor Principal
Collections and deposited into the Principal Account on such Transfer Date;
(h) an amount equal to the aggregate amount by which the Collateral
Interest has been reduced below the Required Collateral Interest for reasons
other than the payment of principal to the Collateral Interest Holder (but not
in excess of the aggregate amount of such reductions which have not been
previously reimbursed) shall be treated as a portion of Investor Principal
Collections and deposited into the Principal Account on such Transfer Date;
(i) on each Transfer Date from and after the Reserve Account Funding
Date, but prior to the date on which the Reserve Account terminates as described
in Section 4.15(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;
(j) an amount equal to the amounts determined to be payable pursuant to
subsections 2.11(a)(ii) and (iii) of the Loan Agreement shall be paid to the
Collateral Interest Holder; and
(k) the balance, if any, after giving effect to the payments made
pursuant to subparagraphs (a) through (j) above shall constitute "Shared Excess
Finance Charge Collections" with respect to other Series in Group One.
To the extent of the Finance Charge Shortfall, if any, following the
application on each Transfer Date of Shared Excess Spread as described above,
the servicer shall instruct the Trustee in writing (which writing shall be
substantially in the form of Exhibit B hereto) to apply Shared Excess Finance
Charge Collections with respect to Group One allocable to Series 1998-5 in the
priority set forth above.
<PAGE>
37
SECTION IV.9. Reallocated Principal Collections. On or before each
Transfer Date, the Servicer shall instruct the Trustee in writing (which writing
shall be substantially in the form of Exhibit B hereto) to withdraw from the
Principal Account and apply Reallocated Principal Collections (applying all
Reallocated Collateral Principal Collections in accordance with subsections
4.12(a) and (b) prior to applying any Reallocated Class B Principal Collections
in accordance with subsection 4.12(a) for any amounts still owing after the
application of Reallocated Collateral Principal Collections) with respect to
such Transfer Date, to make the following distributions on each Transfer Date in
the following priority:
(a) an amount equal to the excess, if any, of (i) the Class A Required
Amount, if any, with respect to such Transfer Date over (ii) the amount of
Excess Spread with respect to the related Monthly Period, shall be applied
pursuant to the priority set forth in subsection 4.9(a); and
(b) an amount equal to the excess, if any, of (i) the Class B Required
Amount, if any, with respect to such Transfer Date over (ii) the amount of
Excess Spread allocated and available to the Class B Certificates pursuant to
subsection 4.11(c) on such Transfer Date shall be applied first pursuant to the
priority set forth in subsection 4.9(b) and then pursuant to subsection 4.11(c).
(c) On each Transfer Date, the Collateral Interest shall be reduced by
the amount of Reallocated Collateral Principal Collections and by the amount of
Reallocated Class B Principal Collections for such Transfer Date. In the event
that such reduction would cause the Collateral Interest (after giving effect to
any Collateral Charge-Offs for such Transfer Date) to be a negative number, the
Collateral Interest (after giving effect to any Collateral Charge-Offs for such
Transfer Date) shall be reduced to zero and the Class B Investor Interest shall
be reduced by the amount by which the Collateral Interest would have been
reduced below zero. In the event that the reallocation of Reallocated Principal
Collections would cause the Class B Investor Interest (after giving effect to
any Class B Investor Charge-Offs for such Transfer Date) to be a negative number
on any Transfer Date, Reallocated Principal Collections shall be reallocated on
such Transfer Date in an aggregate amount not to exceed the amount which would
cause the Class B Investor Interest (after giving effect to any Class B Investor
Charge-Offs for such Transfer Date) to be reduced to zero.
SECTION IV.10. Shared Principal Collections.
(a) The portion of Shared Principal Collections on deposit in the
Principal Account equal to the amount of Shared Principal Collections allocable
to Series 1998-5 on any Transfer Date shall be applied as Available Investor
Principal Collections pursuant to Section 4.9 and pursuant to such Section 4.9
shall be
<PAGE>
38
deposited in the Distribution Account or distributed in accordance with the
Loan Agreement.
(b) Shared Principal Collections allocable to Series 1998-5 with
respect to any Transfer Date shall mean an amount equal to the Series Principal
Shortfall, if any, with respect to Series 1998-5 for such Transfer Date;
provided, however, that if the aggregate amount of Shared Principal Collections
for all Series for such Transfer Date is less than the Cumulative Series
Principal Shortfall for such Transfer Date, then Shared Principal Collections
allocable to Series 1998-5 on such Transfer Date shall equal the product of (i)
Shared Principal Collections for all Series for such Transfer Date and (ii) a
fraction, the numerator of which is the Series Principal Shortfall with respect
to Series 1998-5 for such Transfer Date and the denominator of which is the
aggregate amount of Cumulative Series Principal Shortfall for all Series for
such Transfer Date.
SECTION IV.11. Principal Funding Account.
(a) The Trustee shall establish and maintain, in the name of the Trust,
on behalf of the Trust, for the benefit of the Investor Certificateholders, an
Eligible Deposit Account (the "Principal Funding Account"), bearing a
designation clearly indicating that the funds deposited therein are held for the
benefit of the Investor Certificateholders. The Trustee shall possess all right,
title and interest in all funds on deposit from time to time in the Principal
Funding Account and in all proceeds thereof. The Principal Funding Account shall
be under the sole dominion and control of the Trustee for the benefit of the
Investor Certificateholders. If at any time the Principal Funding Account ceases
to be an Eligible Deposit Account, the Transferor shall notify the Trustee, and
the Trustee upon being notified (or the Servicer on its behalf) shall, within 10
Business Days, establish a new Principal Funding Account meeting the conditions
specified in the definition of Eligible Deposit Account, and shall transfer any
cash or any investments to such new Principal Funding Account. The Trustee, at
the direction of the Servicer, shall (i) make withdrawals from the Principal
Funding Account from time to time, in the amounts and for the purposes set forth
in this Series Supplement, and (ii) on each Transfer Date (from and after the
commencement of the Controlled Accumulation Period) prior to termination of the
Principal Funding Account make a deposit into the Principal Funding Account in
the amount specified in, and otherwise in accordance with, subsection 4.9(e).
(b) Funds on deposit in the Principal Funding Account shall be invested
at the direction of the Servicer by the Trustee in Permitted Investments. Funds
on deposit in the Principal Funding Account on any Transfer Date, after giving
effect to any withdrawals from the Principal Funding Account on such Transfer
Date, shall be invested in such investments that will mature so that such funds
will be available for withdrawal on or prior to
<PAGE>
39
the next succeeding Transfer Date. The Trustee shall maintain for the benefit of
the Investor Certificateholders possession of the negotiable instruments or
securities, if any, evidencing such Permitted Investments. No Permitted
Investment shall be disposed of prior to its maturity.
On the Transfer Date occurring in the month following the commencement
of the Controlled Accumulation Period and on each Transfer Date thereafter with
respect to the Controlled Accumulation Period, the Trustee, acting at the
Servicer's direction given on or before such Transfer Date, shall transfer from
the Principal Funding Account to the Finance Charge Account the Principal
Funding Investment Proceeds on deposit in the Principal Funding Account, but not
in excess of the Covered Amount, for application as Class A Available Funds
applied pursuant to subsection 4.9(a)(i).
Any Excess Principal Funding Investment Proceeds shall be paid to the
Transferor on each Transfer Date. An amount equal to any Principal Funding
Investment Shortfall shall be deposited in the Finance Charge Account on each
Transfer Date from the Reserve Account to the extent funds are available
pursuant to subsection 4.15(d). Principal Funding Investment Proceeds (including
reinvested interest) shall not be considered part of the amounts on deposit in
the Principal Funding Account for purposes of this Series Supplement.
SECTION IV.12. Reserve Account.
(a) The Trustee shall establish and maintain, on behalf of the Trust,
for the benefit of the Investor Certificateholders, an Eligible Deposit Account
(the "Reserve Account"), bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Investor Certificateholders.
The Trustee shall possess all right, title and interest in all funds on deposit
from time to time in the Reserve Account and in all proceeds thereof. The
Reserve Account shall be under the sole dominion and control of the Trustee for
the benefit of the Investor Certificateholders. If at any time the institution
holding the Reserve Account ceases to be an Eligible Deposit Account, the
Transferor shall notify the Trustee, and the Trustee upon being notified (or the
Servicer on its behalf) shall, within 10 Business Days, establish a new Reserve
Account meeting the conditions specified in the definition of Eligible Deposit
Account, and shall transfer any cash or any investments to such new Reserve
Account. The Trustee, at the direction of the Servicer, shall (i) make
withdrawals from the Reserve Account from time to time in an amount up to the
Available Reserve Account Amount at such time, for the purposes set forth in
this Series Supplement, and (ii) on each Transfer Date (from and after the
Reserve Account Funding Date) prior to termination of the Reserve Account make a
deposit into the Reserve Account in the amount specified in, and otherwise in
accordance with, subsection 4.11(i).
<PAGE>
40
(b) Funds on deposit in the Reserve Account shall be invested at the
direction of the Servicer by the Trustee in Permitted Investments. Funds on
deposit in the Reserve Account on any Transfer Date, after giving effect to any
withdrawals from the Reserve Account on such Transfer Date, shall be invested in
such investments that will mature so that such funds will be available for
withdrawal on or prior to the next succeeding Transfer Date. The Trustee shall
maintain for the benefit of the Investor Certificateholders possession of the
negotiable instruments or securities, if any, evidencing such Permitted
Investments. No Permitted Investment shall be disposed of prior to its maturity.
On each Transfer Date, all interest and earnings (net of losses and investment
expenses) accrued since the preceding Transfer Date on funds on deposit in the
Reserve Account shall be retained in the Reserve Account (to the extent that the
Available Reserve Account Amount is less than the Required Reserve Account
Amount) and the balance, if any, shall be deposited into the Finance Charge
Account and included in Class A Available Funds for such Transfer Date. For
purposes of determining the availability of funds or the balance in the Reserve
Account for any reason under this Series Supplement, except as otherwise
provided in the preceding sentence, investment earnings on such funds shall be
deemed not to be available or on deposit.
(c) On or before each Transfer Date with respect to the Controlled
Accumulation Period prior to the payment in full of the Class A Investor
Interest and on or before the first Transfer Date with respect to the Rapid
Amortization Period, the Servicer shall calculate the "Reserve Draw Amount"
which shall be equal to the Principal Funding Investment Shortfall with respect
to each Transfer Date with respect to the Controlled Accumulation Period or the
first Transfer Date with respect to the Rapid Amortization Period; 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 4.11(i) with
respect to such Transfer Date.
(d) In the event that for any Transfer Date the Reserve Draw Amount is
greater than zero, the Reserve Draw Amount, up to the Available Reserve Account
Amount, shall be withdrawn from the Reserve Account on such Transfer Date by the
Trustee (acting in accordance with the instructions of the Servicer), deposited
into the Finance Charge Account and included in Class A Available Funds for such
Transfer Date.
(e) In the event that the Reserve Account Surplus on any Transfer Date,
after giving effect to all deposits to and withdrawals from the Reserve Account
with respect to such Transfer Date, is greater than zero, the Trustee, acting in
accordance with the instructions of the Servicer, shall withdraw from the
Reserve Account, and pay in accordance with the Loan Agreement, an amount equal
to such Reserve Account Surplus.
<PAGE>
41
(f) Upon the earliest to occur of (i) the termination of the Trust
pursuant to Article XII of the Agreement, (ii) if the Controlled Accumulation
Period has not commenced, the first Transfer Date relating to the Rapid
Amortization Period and (iii) if the Controlled Accumulation Period has
commenced, the earlier of the first Transfer Date with respect to the Rapid
Amortization Period and the Transfer Date immediately preceding the Class A
Scheduled Payment Date, the Trustee, acting in accordance with the instructions
of the Servicer, after the prior payment of all amounts owing to the Series
1998-5 Certificateholders that are payable from the Reserve Account as provided
herein, shall withdraw from the Reserve Account and pay in accordance with the
Loan Agreement, all amounts, if any, on deposit in the Reserve Account and the
Reserve Account shall be deemed to have terminated for purposes of this Series
Supplement.
SECTION IV.13. Determination of LIBOR.
(a) On each LIBOR Determination Date, the Trustee shall determine LIBOR
on the basis of the rate for deposits in United States dollars for a period
equal to the relevant Interest Period (except that, for the purpose of
determining LIBOR, the initial Interest Period shall be one month) which appears
on Telerate Page 3750 as of 11:00 a.m., London time, on such date. If such rate
does not appear on Telerate Page 3750, the rate for that LIBOR Determination
Date 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
period equal to the relevant Interest Period. The Trustee shall request the
principal London office of each of the Reference Banks to provide a quotation of
its rate. If at least two such quotations are provided, the rate for that LIBOR
Determination Date shall be the arithmetic mean of the quotations. If fewer than
two quotations are provided as requested, the rate for that LIBOR Determination
Date will be the arithmetic mean of the rates quoted by major banks in New York
City, selected by the Servicer, at approximately 11:00 a.m., New York City time,
on that day for loans in United States dollars to leading European banks for a
period equal to the relevant Interest Period.
(b) The Trustee shall provide the Class A Certificate Rate and the
Class B Certificate Rate applicable to the then current and immediately
preceding Interest Periods to any Investor Certificateholder requesting such
information by telephoning the Trustee at the telephone number which is
currently (212) 815-5286.
(c) On each LIBOR Determination Date prior to 12:00 noon New York City
time, the Trustee shall send to the Servicer by facsimile notification of LIBOR
for the following Interest Period.
<PAGE>
42
SECTION IV.14. Transferor's or Servicer's Failure to Make a Deposit or
Payment.
If the Servicer or the Transferor fails to make, or give instructions
to make, any payment or deposit (other than as required by subsections 2.4(d)
and (e) and 12.2(a) or Sections 10.2 and 12.1) required to be made or given by
the Servicer or Transferor, respectively, at the time specified in the Agreement
(including applicable grace periods), the Trustee shall make such payment or
deposit from the applicable Investor Account without instruction from the
Servicer or Transferor. The Trustee shall be required to make any such payment,
deposit or withdrawal hereunder only to the extent that the Trustee has
sufficient information to allow it to determine the amount thereof; provid ed,
however, that the Trustee shall in all cases be deemed to have sufficient
information to determine the amount of interest payable to the Series 1998-5
Certificateholders on each Distribution Date. The Servicer shall, upon request
of the Trustee, promptly provide the Trustee with all information necessary to
allow the Trustee to make such payment, deposit or withdrawal. Such funds or the
proceeds of such withdrawal shall be applied by the Trustee in the manner in
which such payment or deposit should have been made by the Transferor or the
Servicer, as the case may be.
SECTION IV.15. Article V of the Agreement. Article V of the Agreement
shall read in its entirety as follows and shall be applicable only to the
Investor Certificateholders:
ARTICLE V
DISTRIBUTIONS AND REPORTS TO INVESTOR
CERTIFICATEHOLDERS
SECTION V.1. Distributions. (a) On each Distribution Date, the Trustee
shall distribute (in accordance with the certificate delivered on or before the
related Transfer Date by the Servicer to the Trustee pursuant to subsection
3.4(b)) to each Class A Certificateholder of record on the immediately preceding
Record Date (other than as provided in subsection 2.4(e) or Section 12.3
respecting a final distribution) such Certificateholder's pro rata share (based
on the aggregate Undivided Interests represented by Class A Certificates held by
such Certificateholder) of amounts on deposit in the Distribution Account as are
payable to the Class A Certificateholders pursuant to Section 4.9 by check
mailed to each Class A Certificateholder (at such Certificateholder's address as
it appears in the Certificate Register), except that with respect to Class A
Certificates registered in the name of the nominee of a Clearing Agency, such
distribution shall be made in immediately available funds.
<PAGE>
43
(b) On each Distribution Date, the Trustee shall distribute (in
accordance with the certificate delivered on or before the related Transfer Date
by the Servicer to the Trustee pursuant to subsection 3.4(b)) to each Class B
Certificateholder of record on the immediately preceding Record Date (other than
as provided in subsection 2.4(e) or Section 12.3 respecting a final
distribution) such Certificateholder's pro rata share (based on the aggregate
Undivided Interests represented by Class B Certificates held by such
Certificateholder) of amounts on deposit in the Distribution Account as are
payable to the Class B Certificateholders pursuant to Section 4.9 by check
mailed to each Class B Certificateholder (at such Certificateholder's address as
it appears in the Certificate Register), except that with respect to Class B
Certificates registered in the name of the nominee of a Clearing Agency, such
distribution shall be made in immediately available funds.
SECTION V.2. Monthly Series 1998-5 Certificateholders' Statement.
(a) On or before each Distribution Date, the Trustee shall forward to
each Series 1998-5 Certificateholder, each Rating Agency and the Collateral
Interest Holder a statement substantially in the form of Exhibit C to this
Series Supplement prepared by the Servicer, delivered to the Trustee and setting
forth, among other things, the following information (which, in the case of
subclauses (i) and (ii) below, shall be stated on the basis of an original
principal amount of $1,000 per Certificate and, in the case of subclauses (viii)
and (ix) shall be stated on an aggregate basis and on the basis of an original
principal amount of $1,000 per Certificate, as applicable):
(i) the amount of the current distribution allocable to Class A Monthly
Principal, Class B Monthly Principal and Collateral Monthly Principal,
respectively;
(ii) the amount of the current distribution allocable to Class A
Monthly Interest, Class A Deficiency Amounts, Class A Additional Interest,
Class B Monthly Interest, Class B Deficiency Amounts, Class B Additional
Interest and Collateral Monthly Interest, and any accrued and unpaid
Collateral Monthly Interest, respectively;
(iii) the amount of Collections of Principal Receivables processed
during the related Monthly Period and allocated in respect of the Class A
Certificates, the Class B Certificates and the Collateral Interest,
respectively;
(iv) the amount of Collections of Finance Charge Receivables processed
during the related Monthly Period and allocated in respect of the Class A
Certificates, the Class B Certificates and the Collateral Interest,
respectively;
<PAGE>
44
(v) the aggregate amount of Principal Receivables, the Investor
Interest, the Adjusted Investor Interest, the Class A Investor Interest, the
Class A Adjusted Investor Interest, the Class B Investor Interest, the
Collateral Interest, the Floating Investor Percentage, the Class A Floating
Allocation, the Class B Floating Allocation, the Collateral Floating
Allocation and the Fixed Investor Percentage, Class A Fixed Allocation, the
Class B Fixed Allocation and the Collateral Fixed Allocation with respect to
the Principal Receivables in the Trust as of the close of business on the
Distribution Date preceding such Transfer Date (after giving effect to all
of the transactions occurring on such date);
(vi) the aggregate outstanding balance of Accounts which were 30 to 59,
60 to 89, and 90 or more days delinquent as of the end of the day on the
Record Date;
(vii) the Aggregate Investor Default Amount, the Class A Investor
Default Amount, the Class B Investor Default Amount and the Collateral
Default Amount for the related Monthly Period;
(viii) the aggregate amount of Class A Investor Charge-Offs, Class B
Investor Charge-Offs and Collateral Charge-Offs for the related Monthly
Period;
(ix) the aggregate amount of Class A Investor Charge-Offs, Class B
Investor Charge-Offs and Collateral Charge-Offs reimbursed on the Transfer
Date immediately preceding such Distribution Date;
(x) the amount of the Class A Servicing Fee, the Class B Servicing Fee
and the Collateral Servicing Fee for the related Monthly Period;
(xi) the Portfolio Yield for the preceding Monthly Period;
(xii) the amount of Reallocated Collateral Principal Collections and
Reallocated Class B Principal Collections with respect to such Distribution
Date;
(xiii) the Class B Investor Interest and the Collateral Interest as of
the close of business on such Distribution Date;
(xiv) LIBOR for the Interest Period ending on such Distribution Date;
(xv) the Principal Funding Account Balance on the Transfer Date;
(xvi) the Accumulation Shortfall;
<PAGE>
45
(xvii) the Principal Funding Investment Proceeds transferred to the
Finance Charge Account on the related Transfer Date;
(xviii) the Principal Funding Investment Shortfall on the related
Transfer Date;
(xix) the amount of Class A Available Funds and Class B Available Funds
on deposit in the Finance Charge Account on the related Transfer Date;
(xx) the current Class A Certificate Rate, Class B Certificate Rate and
Collateral Rate; and
(xxi) such other items as are set forth in Exhibit C to this Series
Supplement.
(b) Annual Certificateholders' Tax Statement. On or before January 31
of each calendar year, beginning with calendar year 1999, the Trustee shall
distribute to each Person who at any time during the preceding calendar year was
a Series 1998-5 Certificateholder, a statement prepared by the Servicer
containing the information required to be contained in the regular monthly
report to Series 1998-5 Certificateholders, as set forth in subclauses (i) and
(ii) above, aggregated for such calendar year or the applicable portion thereof
during which such Person was a Series 1998-5 Certificateholder, together with
such other customary information (consistent with the treatment of the
Certificates as debt) as the Servicer deems necessary or desirable to enable the
Series 1998-5 Certificateholders to prepare their tax returns. Such obligations
of the Trustee shall be deemed to have been satisfied to the extent that
substantially comparable information shall be provided by the Trustee pursuant
to any requirements of the Internal Revenue Code as from time to time in effect.
SECTION V.3. Series 1998-5 Pay Out Events. If any one of the following
events shall occur with respect to the Investor Certificates:
(a) failure on the part of the Transferor (i) to make any payment or
deposit required by the terms of (A) the Agreement or (B) this Series
Supplement, on or before the date occurring five days after the date such
payment or deposit is required to be made herein or (ii) duly to observe or
perform in any material respect any covenants or agreements of the Transferor
set forth in the Agreement or this Series Supplement, which failure has a
material adverse effect on the Series 1998-5 Certificateholders (which
determination shall be made without reference to the amount of the Collateral
Interest) and which continues unremedied for a period of 60 days after the date
on which written notice of such failure, requiring the same to be remedied,
shall have been given to the Transferor by the Trustee, or to the Transferor and
the Trustee by the Holders of Investor Certificates evidencing
<PAGE>
46
Undivided Interests aggregating not less than 50% of the Investor Interest of
this Series 1998-5, and continues to affect materially and adversely the
interests of the Series 1998-5 Certificateholders (which determination shall be
made without reference to the amount of the Collateral Interest) for such
period;
(b) any representation or warranty made by the Transferor in the
Agreement or this Series Supplement, or any information contained in a computer
file or microfiche list required to be delivered by the Transferor pursuant to
Section 2.1 or 2.6, (i) shall prove to have been incorrect in any material
respect when made or when delivered, which continues to be incorrect in any
material respect for a period of 60 days after the date on which written notice
of such failure, requiring the same to be remedied, shall have been given to the
Transferor by the Trustee, or to the Transferor and the Trustee by the Holders
of Investor Certificates evidencing Undivided Interests aggregating not less
than 50% of the Investor Interest of this Series 1998-5, and (ii) as a result of
which the interests of the Series 1998-5 Certificateholders are materially and
adversely affected (which determination shall be made without reference to the
amount of the Collateral Interest) and continue to be materially and adversely
affected for such period; provided, however, that a Series 1998-5 Pay Out Event
pursuant to this subsection 9(b) hereof shall not be deemed to have occurred
hereunder if the Transferor has accepted reassignment of the related Receivable,
or all of such Receivables, if applicable, during such period in accordance with
the provisions of the Agreement;
(c) the average Portfolio Yield for any three consecutive Monthly
Periods is reduced to a rate which is less than the average Base Rate for such
period;
(d) the Transferor shall fail to convey Receivables arising under
Additional Accounts, or Participations, to the Trust, as required by subsection
2.6(a);
(e) any Servicer Default shall occur which would have a material
adverse effect on the Series 1998-5 Certificateholders; or
(f) the Class A Investor Interest shall not be paid in full on the
Class A Scheduled Payment Date or the Class B Investor Interest shall not be
paid in full on the Class B Scheduled Payment Date;
then, in the case of any event described in subsection 9(a), (b) or (e) hereof,
after the applicable grace period set forth in such subparagraphs, either the
Trustee or Holders of Investor Certificates and the Collateral Interest Holder
evidencing Undivided Interests aggregating not less than 50% of the Investor
Interest of this Series 1998-5 by notice then given in writing to
<PAGE>
47
the Transferor and the Servicer (and to the Trustee if given by the
Certificateholders) may declare that a pay out event (a "Series 1998-5 Pay Out
Event") has occurred as of the date of such notice, and in the case of any event
described in subsection 9(c), (d) or (f) hereof, a Series 1998-5 Pay Out Event
shall occur without any notice or other action on the part of the Trustee or the
Investor Certificateholders immediately upon the occurrence of such event.
SECTION V.4. Issuance of Additional Certificates.
(a) During the Revolving Period, the Transferor may, in its discretion
and subject to the terms of subsection (b) below, request the Trustee to issue
additional Investor Certificates of each Class (all such additional
certificates, the "Additional Certificates") in an amount and on the date (the
"Additional Certificate Date") determined by the Transferor. Upon issuance, the
Additional Certificates will be identical in all respects (except that the
principal amount of such Additional Certificates may be different) to the
Investor Certificates currently outstanding and will be equally and ratably
entitled to the benefits of this Series Supplement and the Pooling and Servicing
Agreement. The outstanding principal amounts of all Classes of Investor
Certificates shall be increased pro rata. The Controlled Accumulation Amount for
each Class shall be increased proportionally to reflect the additional amounts
represented by the Additional Certificates.
(c) Additional Certificates shall only be issued upon satisfaction of
all of the following conditions:
(i) On or before the fifth Business Day imme diately preceding the date
on which the Additional Certificates are to be issued, the Transferor shall
give notice to the Trustee, the Servicer, the Collateral Interest Holder and
the Rating Agencies of such issuance and the date upon which it is to occur;
(ii) After giving effect to the Additional Certificates, the total
amount of Principal Receivables in the Trust shall be greater than or equal
to the Minimum Aggregate Principal Receivables;
(iii) The Transferor shall have delivered evidence of the proportional
increase in the Collateral Interest to the Trustee and the Rating Agencies;
(iv) On or before the Additional Certificate Date, the Trustee shall
have been provided evidence that the Rating Agency Condition shall have been
satisfied with respect to such issuance;
(v) The Transferor shall have delivered to the Trustee an Officer's
Certificate dated as of the Additional
<PAGE>
48
Certificate Date, stating that the Transferor reasonably believes that the
issuance of such Additional Certificates will not have a material adverse
effect on any outstanding Class of Investor Certificates;
(vi) As of the Additional Certificate Date, the amount of Investor
Charge-Offs for all Classes of Investor Certificates shall be zero; and
(vii) The Transferor shall have delivered to the Trustee a Tax Opinion
with respect to such issuance.
SECTION V.5. Series 1998-5 Termination. The right of the Investor
Certificateholders to receive payments from the Trust will terminate on the
first Business Day following the Series 1998-5 Termination Date.
SECTION V.6. 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 V.7. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS, AND WITHOUT,
LIMITING THE GENERALITY OF THE FOREGOING, THE IMMUNITY AND STANDARD OF CARE OF
THE TRUSTEE IN THE ADMINISTRATION OF THE TRUST HEREUNDER SHALL BE GOVERNED BY
THE LAWS OF THE STATE OF NEW YORK.
SECTION V.8. No Petition. The Transferor, the Servicer and the Trustee,
by entering into this Series Supplement and each Certificateholder, by accepting
a Series 1998-5 Certificate hereby covenant and agree that they will not at any
time institute against the Trust, or join in any institution against the Trust
of, any bankruptcy proceedings under any United States Federal or state
bankruptcy or similar law in connection with any obligations relating to the
Investor Certificateholders, the Agreement or this Series Supplement.
SECTION V.9. Tax Representation and Covenant. Any Collateral Interest
Holder shall be required to represent and covenant in connection with such
acquisition that (x) it has neither acquired, nor will it sell, trade or
transfer any interest in the Trust or cause any interest in the Trust to be
marketed on or through an "established securities market" within the meaning of
Code section 7704(b)(1), including without limitation an interdealer quotation
system that regularly disseminates firm buy or sell quotations by identified
brokers or dealers by electronic means or otherwise, (y) unless the Transferor
consents otherwise, such holder (i) is properly classified as, and will remain
classified as, a "corporation" as
<PAGE>
49
described in Code section 7701(a)(3) and (ii) is not, and will not become, an S
corporation as described in Code section 1361, and (z) it will (i) cause any
participant with respect to such interest otherwise permitted hereunder to make
similar representations and covenants for the benefit of the Transferor and the
Trust and (ii) forward a copy of such representations and covenants to the
Trustee. Each such holder shall further agree in connection with its acquisition
of such interest that, in the event of any breach of its (or its participant's)
representation and covenant that it (or its participant) is and shall remain
classified as a corporation other than an S corporation, the Transferor shall
have the right to procure a replacement investor to replace such holder (or its
participant), and further that such holder shall take all actions necessary to
permit such replacement investor to succeed to its rights and obligations as a
holder (or to the rights of its participant).
SECTION V.10. Amendment to Agreement. By purchasing their Series 1998-5
Certificates each Investor Certificateholder shall be deemed to have consented
that The Chase Manhattan Bank shall be replaced as Servicer with The Chase
Manhattan Bank USA, National Association, as a successor servicer pursuant to an
amendment of the Agreement to be executed at such time as shall be agreed to by
the parties thereto.
<PAGE>
50
IN WITNESS WHEREOF, the Transferor, the Servicer and the Trustee have
caused this Series 1998-5 Supplement to be duly executed by their respective
officers as of the day and year first above written.
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION
Transferor on and after June 1, 1996
By: /s/ Keith Schuck
------------------------------------
Name: Keith Schuck
Title: Vice President
THE CHASE MANHATTAN BANK,
Transferor prior to June 1, 1996
and Servicer
By: /s/ Patrick Margey
------------------------------------
Name: Patrick Margey
Title: Vice President
THE BANK OF NEW YORK,
Trustee
By: /s/ Reyne A. Macadaeg
------------------------------------
Name: Reyne A. Macadaeg
Title: Vice President
<PAGE>
EXHIBIT A-1
FORM OF CERTIFICATE
CLASS A
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO CHASE MANHATTAN
BANK USA, NATIONAL ASSOCIATION, OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
EACH PURCHASER REPRESENTS AND WARRANTS FOR THE BENEFIT OF CHASE
MANHATTAN BANK USA, NATIONAL ASSOCIATION, THAT UNLESS SUCH PURCHASER, AT ITS
EXPENSE, DELIVERS TO THE TRUSTEE, THE SERVICER AND THE TRANSFEROR AN OPINION OF
COUNSEL SATISFACTORY TO THEM TO THE EFFECT THAT THE PURCHASE OR HOLDING OF THIS
CERTIFICATE BY SUCH PURCHASER WILL NOT RESULT IN THE ASSETS OF THE TRUST BEING
DEEMED TO BE "ASSETS OF THE BENEFIT PLAN" OR SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974,
AS AMENDED ("ERISA")AND THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND WILL NOT SUBJECT THE TRUSTEE, THE TRANSFEROR OR THE SERVICER TO ANY
OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND SERVICING
AGREEMENT, SUCH PURCHASER IS NOT (I) AN EMPLOYEE BENEFIT PLAN (AS DEFINED IN
SECTION 3(3) ERISA) THAT IS SUBJECT TO THE PROVISIONS OF TITLE I OF ERISA, (II)
A PLAN DESCRIBED IN SECTION 4975(E)(1) OF THE CODE, OR (III) AN ENTITY WHOSE
UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF A PLAN'S INVESTMENT IN THE
ENTITY.
<PAGE>
A-1-2
No. ___ $_________
CUSIP NO.16157PAY3
CHASE CREDIT CARD MASTER TRUST
CLASS A FLOATING RATE
ASSET BACKED CERTIFICATE, SERIES 1998-5
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of MasterCard(R) and VISA(R)(1) credit card receivables generated or
acquired by Chase Manhattan Bank USA, National Association ("Chase USA") and
other assets and interests constituting the Trust under the Pooling and
Servicing Agreement described below.
(Not an interest in or obligation of
Chase USA
or any Affiliate thereof.)
This certifies that CEDE & CO. (the "Class A Certifi
cateholder") 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 and arising in connection with
selected MasterCard and VISA credit card accounts (the "Accounts") of Chase USA,
all monies due or to become due in payment of the Receivables (including all
Finance Charge Receivables), the right to certain amounts received as
Interchange and Recoveries (if any), the benefits of the Collateral Interest,
all proceeds of the foregoing and the other assets and interests constituting
the Trust pursuant to the Second Amended and Restated Pooling and Servicing
Agreement dated as of September 1, 1996 as supplemented by the Series 1998-5
Supplement dated as of September 24, 1998 (collectively, the "Pooling and
Servicing Agreement"), by and among Chase USA, as Transferor on and after June
1, 1996, The Chase Manhattan Bank, as Transferor prior to June 1, 1996 and as
Servicer, and The Bank of New York, as Trustee (the "Trustee"). To the extent
not defined herein, capitalized terms used herein have the respective meanings
assigned to them in the Pooling and Servicing Agreement.
The Series 1998-5 Certificates are issued in two classes, the
Class A Certificates (of which this certificate is one) and the Class B
Certificates, which are subordinated to the Class A Certificates in certain
rights of payment as described herein and in the Pooling and Servicing
Agreement.
- --------
(1) MasterCard(R) and VISA(R) are federally registered servicemarks
of MasterCard International Inc. and of Visa U.S.A., Inc.,
respectively.
<PAGE>
A-1-3
The Transferor has structured the Pooling and Servicing
Agreement and the Series 1998-5 Certificates with the intention that the Series
1998-5 Certificates will qualify under applicable tax law as indebtedness, and
each of the Transferor, the Holder of the Transferor Certificate, the Servicer
and each Series 1998-5 Certificateholder (or Series 1998-5 Certificate Owner) by
acceptance of its Series 1998-5 Certificate (or in the case of a Series 1998-5
Certificate Owner, by virtue of such Series 1998-5 Certificate Owner's
acquisition of a beneficial interest therein), agrees to treat and to take no
action inconsistent with the treatment of the Series 1998-5 Certificates (or any
beneficial interest therein) as indebtedness for purposes of federal, state,
local and foreign income or franchise taxes and any other tax imposed on or
measured by income. Each Series 1998-5 Certificateholder agrees that it will
cause any Series 1998-5 Certificate Owner acquiring an interest in a Series
1998-5 Certificate through it to comply with the Pooling and Servicing Agreement
as to treatment of the Series 1998-5 Certificates as indebtedness for certain
tax purposes.
This Class A Certificate is issued under and is subject to the
terms, provisions and conditions of the Pooling and Servicing Agreement, to
which Pooling and Servicing Agreement, as amended from time to time, the Class A
Certificateholder by virtue of the acceptance hereof assents and by which the
Class A Certificateholder is bound. This Class A Certificate is one of a duly
authorized Series of Investor Certificates entitled "Class A Floating Rate Asset
Backed Certificates, Series 1998-5" (the "Class A Certificates"), each of which
represents an Undivided Interest in the Trust, including the right to receive
the Collections and other amounts allocated to the Class A Certificates at the
times and in the amounts specified in the Pooling and Servicing Agreement and to
be deposited in the Investor Accounts, the Principal Funding Account and the
Reserve Account or paid to the Class A Certificateholders.
Also issued under the Pooling and Servicing Agreement are the
"Class B Floating Rate Asset Backed Certificates, Series 1998-5" (the "Class B
Certificates"), which represent an Undivided Interest in the Trust subordinate
to the Class A Certificates, and the "Collateral Interest, Series 1998-5" (the
"Collateral Interest" and collectively with the Class A Certificates and the
Class B Certificates, the "Investor Certificates"), which is an undivided
interest in the Trust subordinated to the Class A Certificates and Class B
Certificates. The subordination of the Class B Certificates and the
subordination of the Collateral Interest to the Class A Certificates shall
constitute the Enhancement for the Class A Certificates.
The aggregate interest represented by the Class A Certificates
and the Class B Certificates at any time in the Principal Receivables in the
Trust shall not exceed an amount equal to the Class A Investor Interest and the
Class B Investor
<PAGE>
A-1-4
Interest, respectively, at such time. As of the Closing Date, the Class A
Initial Investor Interest is $650,000,000, the Class B Initial Investor Interest
is $54,166,000 and the Collateral Initial Interest is $69,643,524.
The Class A Investor Interest on any date of determination
will be an amount equal to (a) the Class A Initial Investor Interest minus (b)
the aggregate amount of payments of principal made to the Class A
Certificateholders prior to such date of determination, and minus (c) the
excess, if any, of the aggregate amount of Class A Investor Charge-Offs pursuant
to subsection 4.10(a) of the Pooling and Servicing Agreement over Class A
Investor Charge-Offs reimbursed prior to such date of determination pursuant to
subsection 4.11(b) of the Pooling and Servicing Agreement; provided, however,
that the Class A Investor Interest may not be reduced below zero.
For the purpose of allocating Collections of Finance Charge
Receivables and Receivables in Defaulted Accounts for each Monthly Period during
the Controlled Accumulation Period, the Class A Investor Interest will be
further reduced (such reduced amount, the "Class A Adjusted Investor Interest")
by the aggregate principal amount of funds on deposit in the Principal Funding
Account. The Class A Investor Interest together with the aggregate interest
represented by the Class B Certificates in the Principal Receivables in the
Trust (the "Class B Investor Interest") and the aggregate interest represented
by the Collateral Interest in the Principal Receivables in the Trust are
sometimes collectively referred to herein as the "Investor Interest."
In addition to the Class A Certificates, the Class B
Certificates and the Collateral Interest, a Transferor Certificate representing
an undivided interest in the Trust will be issued to the Transferor pursuant to
the Pooling and Servicing Agreement. The Transferor Certificate will represent
the interest in the Principal Receivables not represented by all of the Series
of Investor Certificates issued by the Trust. The Transferor Certificate may be
exchanged by the Transferor pursuant to the Pooling and Servicing Agreement for
a newly issued Series of Investor Certificates and a reissued Transferor
Certificate upon the conditions set forth in the Pooling and Servicing
Agreement.
Interest will accrue on the Class A Certificates from the
Closing Date through November 15, 1998, and with respect to each Interest Period
thereafter, at the rate of LIBOR plus 0.16% per annum, as more specifically set
forth in the Pooling and Servicing Agreement (the "Class A Certificate Rate"),
and will be distributed on November 16, 1998 and on the 15th day of each
calendar month thereafter, or if such day is not a Business Day, on the next
succeeding Business Day (a "Distribution Date"), to the Class A
Certificateholders of record as of the last Business Day of the calendar month
preceding such Distribution Date (the
<PAGE>
A-1-5
"Record Date"). During the Rapid Amortization Period, in addition to Class A
Monthly Interest, Class A Monthly Principal will be distributed to the Class A
Certificateholder on each Distribution Date until the Class A Certificates have
been paid in full. During the Controlled Accumulated Period, in addition to
monthly payments of Class A Monthly Interest, the amount on deposit in the
Principal Funding Account will be distributed as principal to the Class A
Certificateholders on the September 2003 Distribution Date (the "Class A
Scheduled Payment Date"), unless distributed earlier as a result of the
occurrence of a Pay Out Event in accordance with the Pooling and Servicing
Agreement.
On or before each Transfer Date, the Servicer shall instruct
the Trustee in writing to withdraw and the Trustee, acting in accordance with
such instructions, shall withdraw on such Transfer Date, from the Finance Charge
Account to the extent of funds on deposit therein (i) Collections of Finance
Charge Receivables processed as of the end of the preceding Monthly Period which
have been allocated to the Series 1998-5 Certificates, (ii) with respect to the
Class A Certificates, from other amounts constituting Class A Available Funds,
and (iii) with respect to the Class B Certificates, from other amounts
constituting Class B Available Funds, the following amounts: (x) 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 Certificate Rate for such Interest Period and (ii)
the outstanding principal balance of the Class A Certificates determined as of
the close of business on the Distribution Date preceding the related Transfer
Date (after giving effect to all of the transactions occurring on such date)
("Class A Monthly Interest"), provided, however, that with respect to the first
Distribution Date, Class A Monthly Interest shall be equal to the interest
accrued on the Class A Initial Investor Interest at the applicable Class A
Certificate Rate for the period from the Closing Date through November 15, 1998;
and (y) amounts up to the Class B Monthly Interest followed by the Collateral
Monthly Interest, in the actual amounts and manner described in the Pooling and
Servicing Agreement.
On each Transfer Date, the Trustee shall apply the Class A
Available Funds withdrawn from the Finance Charge Account, as required by the
Pooling and Servicing Agreement, in the following order of priority: (i) an
amount equal to the Class A Monthly Interest for such Transfer Date, plus the
amount of any Class A Deficiency Amount for such Transfer Date, plus the amount
of any Class A Additional Interest for such Transfer Date, (ii) an amount equal
to the Class A Servicing Fee for such Transfer Date plus the amount of any Class
A Servicing Fee due but not paid on any prior Transfer Date and (iii) an amount
equal to the Class A Investor Default Amount, if any, for the preceding Monthly
Period. The Trustee on each Transfer Date shall apply the Class B Available
Funds withdrawn from the Finance Charge Account as required by the Pooling and
Servicing Agreement in the
<PAGE>
A-1-6
following order of priority: (i) the Class B Monthly Interest for such Transfer
Date, plus the amount of any Class B Deficiency Amount for such Transfer Date,
plus the amount of any Class B Additional Interest for such Transfer Date, and
(ii) the Class B Servicing Fee for such Transfer Date plus the amount of any
Class B Servicing Fee due but not paid on any prior Transfer Date. The balance
of the amount withdrawn from the Finance Charge Account allocable to the Series
1998-5 Certificates, if any, after giving effect to the applications above shall
constitute "Excess Spread."
On or before the Transfer Date immediately succeeding the
Monthly Period in which the Controlled Accumulated Period or the Rapid
Amortization Period commences and on or before each Transfer Date thereafter,
the Servicer shall instruct the Trustee in writing to withdraw, and the Trustee,
acting in accordance with such instructions, shall withdraw on such Transfer
Date from the Principal Account an amount equal to the Available Investor
Principal Collections on deposit in the Principal Account and from such amounts,
(A) deposit an amount equal to Class A Monthly Principal (i) during the
Controlled Accumulation Period, into the Principal Funding Account, and (ii)
during the Rapid Amortization Period, into the Distribution Account, (B) after
the Class A Certificates have been paid in full, deposit an amount equal to
Class B Monthly Principal into the Distribution Account, and (C) any remaining
amounts in the Principal Account shall be used for payment of Collateral Monthly
Principal.
On the earlier to occur of the first Transfer Date with
respect to the Rapid Amortization Period or the Transfer Date immediately
preceding the Class A Scheduled Payment Date, the Servicer shall instruct the
Trustee to withdraw, and the Trustee shall withdraw from the Principal Funding
Account and deposit in the Distribution Account the amount on deposit in the
Principal Funding Account.
On the Class A Scheduled Payment Date or on each Distribution
Date with respect to a Rapid Amortization Period, the Trustee shall pay from
amounts on deposit in the Distribution Account an amount equal to the lesser of
the Class A Investor Interest and the amount of Available Investor Principal
Collections on deposit in the Distribution Account with respect to the related
Monthly Period, and after the Class A Certificates have been paid in full (after
taking into account distributions to be made on the related Distribution Date),
Available Investor Principal Collections shall be applied to the Class B Certifi
cates and Collateral Interest as specified in the Pooling and Servicing
Agreement.
On each Distribution Date, the Trustee shall pay to the Class
A Certificateholders and the Class B Certificateholders the amount deposited on
the related Transfer Date into the Distribution Account in respect of Class A
Monthly Interest and Class B Monthly Interest, respectively. On each Transfer
Date,
<PAGE>
A-1-7
the Trustee shall pay to the Collateral Interest Holder the Collateral Monthly
Interest, to the extent funds are available. Distributions with respect to this
Series 1998-5 Certificate will be made by the Trustee by, except as otherwise
provided in the Pooling and Servicing Agreement, check mailed to the address of
each Series 1998-5 Certificateholder of record appearing in the Certificate
Register and except for the final distribution in respect of this Series 1998-5
Certificate, without the presentation or surrender of this Series 1998-5
Certificate or the making of any notation thereon; provided, however, that with
respect to Series 1998-5 Certificates registered in the name of the nominee of a
Clearing Agency, distributions will be made in the form of immediately available
funds.
This Class A Certificate represents an interest in only the
Chase Credit Card Master Trust. This Class A Certificate does not represent an
obligation of, or an interest in, the Transferor or the Servicer, and neither
the Series 1998-5 Certificates nor the Accounts or Receivables are insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency. This Series 1998-5 Certificate is limited in right of
payment to certain collections respecting the Receivables, all as more
specifically set forth hereinabove and in the Pooling and Servicing Agreement.
The Transfer of this Class A Certificate shall be registered
in the Certificate Register upon surrender of this agency maintained by the
Transfer Agent and Registrar accompanied by a written instrument of transfer in
a form satisfactory to the Trustee and the Transfer Agent and Registrar duly
executed by the Class A Certificateholder or such Class A Certificateholder's
attorney-in-fact duly authorized in writing, and thereupon one or more new Class
A Certificates of authorized denominations and for the same aggregate Undivided
Interests will be issued to the designated transferee or transferees.
The Servicer, the Trustee and the Transfer Agent and
Registrar, and any agent of any of them, may treat the Person in whose name this
Class A Certificate is registered as the owner hereof for all purposes, and
neither the Servicer, the Trustee, the Paying Agent, the Transfer Agent and
Registrar, nor any agent of any of them or of any such agent shall be affected
by notice to the contrary except in certain circumstances described in the
Pooling and Servicing Agreement.
The Pooling and Servicing Agreement provides that the right of
the Series 1998-5 Certificateholders to receive payment from the Trust will
terminate on the first Business Day following the Series 1998-5 Termination
Date. Upon the termination of the Trust pursuant to Section 12.1 of the Pooling
and Servicing Agreement, the Trustee shall assign and convey to the Holder of
the Transferor Certificate (without recourse, representation or warranty) all
right, title and interest of the Trust in the Receivables, whether then existing
or thereafter created, and all
<PAGE>
A-1-8
proceeds of such Receivables and Insurance Proceeds relating to such
Receivables. The Trustee shall execute and deliver such instruments of transfer
and assignment, in each case without recourse, as shall be prepared by the
Servicer reasonably requested by the Holder of the Transferor Certificate to
vest in such Holder all right, title and interest which the Trustee had in the
Receivables.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee, by manual signature, this Class A
Certificate shall not be entitled to any benefit under the Pooling and Servicing
Agreement, or be valid for any purpose.
<PAGE>
A-1-9
IN WITNESS WHEREOF, Chase Manhattan Bank USA, National
Association, has caused this Class A Certificate to be duly executed.
By:
-----------------------------
Authorized Officer
Dated:
<PAGE>
A-1-10
Form of Trustee's Certificate of Authentication
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates of Chase Credit Card
Master Trust, Series 1998-5, referred to in the within-mentioned Pooling and
Servicing Agreement.
THE BANK OF NEW YORK,
Trustee
By:
----------------------------
Authorized Signatory
Dated:
<PAGE>
EXHIBIT A-2
FORM OF CERTIFICATE
CLASS B
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF
THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO CHASE MANHATTAN
BANK USA, NATIONAL ASSOCIATION, OR ITS AGENT FOR REGISTRATION OF TRANSFER,
EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF
CEDE & CO. OR IN SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF
DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS
THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
EACH PURCHASER REPRESENTS AND WARRANTS FOR THE BENEFIT OF CHASE
MANHATTAN BANK USA, NATIONAL ASSOCIATION, THAT UNLESS SUCH PURCHASER, AT ITS
EXPENSE, DELIVERS TO THE TRUSTEE, THE SERVICER AND THE TRANSFEROR AN OPINION OF
COUNSEL SATISFACTORY TO THEM TO THE EFFECT THAT THE PURCHASE OR HOLDING OF THIS
CERTIFICATE BY SUCH PURCHASER WILL NOT RESULT IN THE ASSETS OF THE TRUST BEING
DEEMED TO BE "ASSETS OF THE BENEFIT PLAN" OR SUBJECT TO THE PROHIBITED
TRANSACTION PROVISIONS OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974,
AS AMENDED ("ERISA")AND THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
"CODE") AND WILL NOT SUBJECT THE TRUSTEE, THE TRANSFEROR OR THE SERVICER TO ANY
OBLIGATION IN ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND SERVICING
AGREEMENT, SUCH PURCHASER IS NOT (I) AN EMPLOYEE BENEFIT PLAN (AS DEFINED IN
SECTION 3(3) ERISA) THAT IS SUBJECT TO THE PROVISIONS OF TITLE I OF ERISA, (II)
A PLAN DESCRIBED IN SECTION 4975(E)(1) OF THE CODE, OR (III) AN ENTITY WHOSE
UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF A PLAN'S INVESTMENT IN THE
ENTITY.
<PAGE>
A-2-2
No. ___ $__________
CUSIP NO.16157PAZ0
CHASE CREDIT CARD MASTER TRUST
CLASS B FLOATING RATE
ASSET BACKED CERTIFICATE, SERIES 1998-5
Evidencing an Undivided Interest in a trust, the corpus of which consists of a
portfolio of MasterCard(R) and VISA(R)(2) credit card receivables generated or
acquired by Chase Manhattan Bank USA, National Association ("Chase USA"), and
other assets and interests constituting the Trust under the Pooling and
Servicing Agreement described below.
(Not an interest in or obligation of
Chase USA
or any Affiliate thereof.)
This certifies that CEDE & CO. (the "Class B
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 and arising in connection with
selected MasterCard and VISA credit card accounts (the "Accounts") of Chase USA,
all monies due or to become due in payment of the Receivables (including all
Finance Charge Receivables), the right to certain amounts received as
Interchange and Recoveries (if any), the benefits of the Collateral Interest,
all proceeds of the foregoing and the other assets and interests constituting
the Trust pursuant to the Second Amended and Restated Pooling and Servicing
Agreement dated as of September 1, 1996 as supplemented by the Series 1998-5
Supplement dated as of September 24, 1998 (collectively, the "Pooling and
Servicing Agreement"), by and among Chase USA, as Transferor on and after June
1, 1996, The Chase Manhattan Bank, as Transferor prior to June 1, 1996 and as
Servicer, and The Bank of New York, as Trustee (the "Trustee"). To the extent
not defined herein, capitalized terms used herein have the respective meanings
assigned to them in the Pooling and Servicing Agreement.
The Series 1998-5 Certificates are issued in two classes, the
Class A Certificates and the Class B Certificates (of which this certificate is
one), which are subordinated to the Class A Certificates in certain rights of
payment as described herein and in the Pooling and Servicing Agreement.
The Transferor has structured the Pooling and Servicing
Agreement and the Series 1998-5 Certificates with the intention
- --------
(2) MasterCard(R) and VISA(R) are federally registered servicemarks
of MasterCard International Inc. and of Visa U.S.A., Inc.,
respectively.
<PAGE>
A-2-3
that the Series 1998-5 Certificates will qualify under applicable tax law as
indebtedness, and each of the Transferor, the Holder of the Transferor
Certificate, the Servicer and each Series 1998-5 Certificateholder (or Series
1998-5 Certificate Owner) by acceptance of its Series 1998-5 Certificate (or in
the case of a Series 1998-5 Certificate Owner, by virtue of such Series 1998-5
Certificate Owner's acquisition of a beneficial interest therein), agrees to
treat and to take no action inconsistent with the treatment of the Series 1998-5
Certificates (or any beneficial interest therein) as indebtedness for purposes
of federal, state, local and foreign income or franchise taxes and any other tax
imposed on or measured by income. Each Series 1998-5 Certificateholder agrees
that it will cause any Series 1998-5 Certificate Owner acquiring an interest in
a Series 1998-5 Certificate through it to comply with the Pooling and Servicing
Agreement as to treatment of the Series 1998-5 Certificates as indebtedness for
certain tax purposes.
This Class B Certificate is issued under and is subject to the
terms, provisions and conditions of the Pooling and Servicing Agreement, to
which Pooling and Servicing Agreement, as amended from time to time, the Class B
Certificateholder by virtue of the acceptance hereof assents and by which the
Class B Certificateholder is bound. This Class B Certificate is one of a duly
authorized Series of Investor Certificates entitled "Class B Floating Rate Asset
Backed Certificates, Series 1998-5" (the "Class B Certificates"), each of which
represents an Undivided Interest in the Trust, including the right to receive
the Collections and other amounts allocated to the Class B Certificates at the
times and in the amounts specified in the Pooling and Servicing Agreement and to
be deposited in the Investor Accounts, the Principal Funding Account and the
Reserve Account or paid to the Class B Certificateholders.
Also issued under the Pooling and Servicing Agreement are the
"Class A Floating Rate Asset Backed Certificates, Series 1998-5" (the "Class A
Certificates"), which represent an Undivided Interest in the Trust senior to the
Class B Certificates, and the "Collateral Interest, Series 1998-5" (the
"Collateral Interest" and collectively with the Class A Certificates and the
Class B Certificates, the "Investor Certificates"), which is an undivided
interest in the Trust subordinated to the Class A Certificates and Class B
Certificates. The subordination of the Collateral Interest to the Class B
Certificates shall constitute the Enhancement for the Class B Certificates.
The aggregate interest represented by the Class A Certificates
and the Class B Certificates at any time in the Principal Receivables in the
Trust shall not exceed an amount equal to the Class A Investor Interest and the
Class B Investor Interest, respectively, at such time. As of the Closing Date,
the Class A Initial Investor Interest is $650,000,000, the Class
<PAGE>
A-2-4
B Initial Investor Interest is $54,166,000 and the Collateral Initial Interest
is $69,643,524.
The Class B Investor Interest shall mean, on any date of
determination, an amount equal to (a) the Class B Initial Investor Interest,
minus (b) the aggregate amount of principal payments made to Class B
Certificateholders prior to such date, minus (c) the aggregate amount of Class B
Investor Charge-Offs for all prior Transfer Dates pursuant to subsection 4.10(b)
of the Pooling and Servicing Agreement, minus (d) the amount of the Reallocated
Class B Principal Collections allocated pursuant to subsection 4.12(a) of the
Pooling and Servicing Agreement on all prior Transfer Dates for which the
Collateral Interest has not been reduced, minus (e) an amount equal to the
amount by which the Class B Investor Interest has been reduced on all prior
Transfer Dates pursuant to subsection 4.10(a) of the Pooling and Servicing
Agreement and plus (f) the aggregate amount of Excess Spread allocated and
available on all prior Transfer Dates pursuant to subsection 4.11(d) of the
Pooling and Servicing Agreement, for the purpose of reimbursing amounts deducted
pursuant to the foregoing clauses (c), (d) and (e); provided, however, that the
Class B Investor Interest may not be reduced below zero.
The Class B Investor Interest together with the aggregate
interest represented by the Class A Certificates in the Principal Receivables in
the Trust (the "Class A Investor Interest") and the aggregate interest
represented by the Collateral Interest in the Principal Receivables in the Trust
are sometimes collectively referred to herein as the "Investor Interest."
In addition to the Class A Certificates, the Class B
Certificates and the Collateral Interest, a Transferor Certificate representing
an undivided interest in the Trust will be issued to the Transferor pursuant to
the Pooling and Servicing Agreement. The Transferor Certificate will represent
the interest in the Principal Receivables not represented by all of the Series
of Investor Certificates issued by the Trust. The Transferor Certificate may be
exchanged by the Transferor pursuant to the Pooling and Servicing Agreement for
a newly issued Series of Investor Certificates and a reissued Transferor
Certificate upon the conditions set forth in the Pooling and Servicing
Agreement.
Interest will accrue on the Class B Certificates from the
Closing Date through November 15, 1998 and with respect to each Interest Period
thereafter, at the rate of LIBOR plus 0.36% per annum, as more specifically set
forth in the Pooling and Servicing Agreement (the "Class B Certificate Rate"),
and will be distributed on November 16, 1998 and on the 15th day of each
calendar month thereafter, or if such day is not a Business Day, on the next
succeeding Business Day (a "Distribution Date"), to the Class B
Certificateholders of record as of the last Business
<PAGE>
A-2-5
Day of the calendar month preceding such Distribution Date (the "Record Date").
Class B Monthly Principal will be distributed to the Class B Certificateholder
(i) during the Rapid Amortization Period, in addition to Class B Monthly
Interest, on each Distribution Date until the Class B Certificates have been
paid in full or (ii) during the Controlled Accumulated Period following the
payment in full of the Class A Investor Interest, on the October 2003
Distribution Date (the "Class B Scheduled Payment Date"), unless distributed
earlier as a result of the occurrence of a Pay Out Event in accordance with the
Pooling and Servicing Agreement.
On or before each Transfer Date, the Servicer shall instruct
the Trustee in writing to withdraw and the Trustee, acting in accordance with
such instructions, shall withdraw on such Transfer Date, from the Finance Charge
Account to the extent of funds on deposit therein (i) Collections of Finance
Charge Receivables processed as of the end of the preceding Monthly Period which
have been allocated to the Series 1998-5 Certificates, (ii) with respect to the
Class A Certificates, from other amounts constituting Class A Available Funds,
and (iii) with respect to the Class B Certificates, from other amounts
constituting Class B Available Funds, the following amounts: (x) an amount equal
to the Class A Monthly Interest; (y) 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
Certificate Rate for such Interest Period and (ii) the outstanding principal
balance of the Class B Certificates determined as of the close of business on
the Distribution Date preceding the related Transfer Date ("Class B Monthly
Interest"), provided, however, that with respect to the first Distribution Date,
Class B Monthly Interest shall be equal to the interest accrued on the Class B
Initial Investor Interest at the applicable Class B Certificate Rate for the
period from the Closing Date through November 15, 1998; and (Z) amounts up to
the Collateral Monthly Interest, in the actual amounts and manner described in
the Pooling and Servicing Agreement.
On each Transfer Date, the Trustee shall apply the Class A
Available Funds withdrawn from the Finance Charge Account, as required by the
Pooling and Servicing Agreement, in the following order of priority: (i) an
amount equal to the Class A Monthly Interest for such Transfer Date, plus the
amount of any Class A Deficiency Amount for such Transfer Date, plus the amount
of any Class A Additional Interest for such Transfer Date, (ii) an amount equal
to the Class A Servicing Fee for such Transfer Date plus the amount of any Class
A Servicing Fee due but not paid on any prior Transfer Date and (iii) an amount
equal to the Class A Investor Default Amount, if any, for the preceding Monthly
Period. The Trustee on each Transfer Date shall apply the Class B Available
Funds withdrawn from the Finance Charge Account as required by the Pooling and
Servicing Agreement in the following order of priority: (i) the Class B Monthly
Interest for
<PAGE>
A-2-6
such Transfer Date, plus the amount of any Class B Deficiency Amount for such
Transfer Date, plus the amount of any Class B Additional Interest for such
Transfer Date, and (ii) the Class B Servicing Fee for such Transfer Date plus
the amount of any Class B Servicing Fee due but not paid on any prior Transfer
Date. The balance of the amount withdrawn from the Finance Charge Account
allocable to the Series 1998-5 Certificates, if any, after giving effect to the
applications above shall constitute "Excess Spread."
On or before the Transfer Date immediately succeeding the
Monthly Period in which the Controlled Accumulated Period or the Rapid
Amortization Period commences and on or before each Transfer Date thereafter,
the Servicer shall instruct the Trustee in writing to withdraw, and the Trustee,
acting in accordance with such instructions, shall withdraw on such Transfer
Date from the Principal Account an amount equal to the Available Investor
Principal Collections on deposit in the Principal Account and from such amounts,
(A) deposit an amount equal to Class A Monthly Principal (i) during the
Controlled Accumulation Period, into the Principal Funding Account, and (ii)
during the Rapid Amortization Period, into the Distribution Account, (B) after
the Class A Certificates have been paid in full, deposit an amount equal to
Class B Monthly Principal into the Distribution Account, and (C) any remaining
amounts in the Principal Account shall be used for payment of Collateral Monthly
Principal.
On the earlier to occur of the first Transfer Date with
respect to the Rapid Amortization Period after payment in full of the Class A
Investor Interest or the Transfer Date immediately preceding the Class B
Scheduled Payment Date, the Servicer shall instruct the Trustee to withdraw, and
the Trustee shall withdraw from the Principal Account and deposit in the
Distribution Account the amount on deposit in the Principal Account.
On the Class B Scheduled Payment Date or on each Distribution
Date after payment in full of the Class A Investor Interest with respect to a
Rapid Amortization Period, the Trustee shall pay from amounts on deposit in the
Distribution Account an amount equal to the lesser of the Class B Investor
Interest and the amount of Available Investor Principal Collections on deposit
in the Distribution Account with respect to the related Monthly Period, and
after the Class B Certificates have been paid in full (after taking into account
distributions to be made on the related Distribution Date), Available Investor
Principal Collections shall be applied to the Collateral Interest as specified
in the Pooling and Servicing Agreement.
On each Distribution Date, the Trustee shall pay to the Class
A Certificateholders and the Class B Certificateholders the amount deposited on
the related Transfer Date into the Distribution Account in respect of Class A
Monthly Interest and Class B Monthly Interest, respectively. On each Transfer
Date, the Trustee shall pay to the Collateral Interest Holder the
<PAGE>
A-2-7
Collateral Monthly Interest, to the extent funds are available. Distributions
with respect to this Series 1998-5 Certificate will be made by the Trustee by,
except as otherwise provided in the Pooling and Servicing Agreement, check
mailed to the address of each Series 1998-5 Certificateholder of record
appearing in the Certificate Register and except for the final distribution in
respect of this Series 1998-5 Certificate, without the presentation or surrender
of this Series 1998-5 Certificate or the making of any notation thereon;
provided, however, that with respect to Series 1998-5 Certificates registered in
the name of the nominee of a Clearing Agency, distributions will be made in the
form of immediately available funds.
This Class B Certificate represents an interest in only the
Chase Credit Card Master Trust. This Class A Certificate does not represent an
obligation of, or an interest in, the Transferor or the Servicer, and neither
the Series 1998-5 Certificates nor the Accounts or Receivables are insured or
guaranteed by the Federal Deposit Insurance Corporation or any other
governmental agency. This Series 1998-5 Certificate is limited in right of
payment to certain collections respecting the Receivables, all as more
specifically set forth hereinabove and in the Pooling and Servicing Agreement.
The Transfer of this Class B Certificate shall be registered
in the Certificate Register upon surrender of this agency maintained by the
Transfer Agent and Registrar accompanied by a written instrument of transfer in
a form satisfactory to the Trustee and the Transfer Agent and Registrar duly
executed by the Class B Certificateholder or such Class B Certificateholder's
attorney-in-fact duly authorized in writing, and thereupon one or more new Class
B Certificates of authorized denominations and for the same aggregate Undivided
Interests will be issued to the designated transferee or transferees.
The Servicer, the Trustee and the Transfer Agent and
Registrar, and any agent of any of them, may treat the Person in whose name this
Class B Certificate is registered as the owner hereof for all purposes, and
neither the Servicer, the Trustee, the Paying Agent, the Transfer Agent and
Registrar, nor any agent of any of them or of any such agent shall be affected
by notice to the contrary except in certain circumstances described in the
Pooling and Servicing Agreement.
The Pooling and Servicing Agreement provides that the right of
the Series 1998-5 Certificateholders to receive payment from the Trust will
terminate on the first Business Day following the Series 1998-5 Termination
Date. Upon the termination of the Trust pursuant to Section 12.1 of the Pooling
and Servicing Agreement, the Trustee shall assign and convey to the Holder of
the Transferor Certificate (without recourse, representation or warranty) all
right, title and interest of the Trust in the Receivables, whether then existing
or thereafter created, and all proceeds of such Receivables and Insurance
Proceeds relating to
<PAGE>
A-2-8
such Receivables. The Trustee shall execute and deliver such instruments of
transfer and assignment, in each case without recourse, as shall be prepared by
the Servicer reasonably requested by the Holder of the Transferor Certificate to
vest in such Holder all right, title and interest which the Trustee had in the
Receivables.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee, by manual signature, this Class B
Certificate shall not be entitled to any benefit under the Pooling and Servicing
Agreement, or be valid for any purpose.
<PAGE>
A-2-9
IN WITNESS WHEREOF, Chase Manhattan Bank USA, National
Association, has caused this Class B Certificate to be duly executed.
By:
-------------------------
Authorized Officer
Dated:
<PAGE>
A-2-10
Form of Trustee's Certificate of Authentication
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates of Chase Credit Card
Master Trust, Series 1998-5, referred to in the within-mentioned Pooling and
Servicing Agreement.
THE BANK OF NEW YORK,
Trustee
By:
--------------------------
Authorized Signatory
Dated:
<PAGE>
A-2-11
TABLE OF CONTENTS
Page
----
SECTION I.1. Designation................................................... 1
SECTION I.2. Definitions.................................................. 2
SECTION I.3. Servicing Compensation and Assignment of
Interchange....................................................... 19
SECTION I.4. Reassignment and Transfer Terms.............................. 21
SECTION I.5. Delivery and Payment for the Investor
Certificates...................................................... 21
SECTION I.6. Depository; Form of Delivery of Investor
Certificates...................................................... 21
SECTION I.7. Article IV of Agreement...................................... 21
SECTION IV.1. Rights of Certificateholders and the
Collateral Interest Holder........................................ 21
SECTION IV.2. Allocations................................................. 22
SECTION IV.5. Coverage of Required Amount................................. 28
SECTION IV.6. Monthly Payments............................................ 29
SECTION IV.8. Excess Spread............................................... 35
SECTION IV.9. Reallocated Principal Collections........................... 37
SECTION IV.14. Transferor's or Servicer's Failure to Make a
Deposit or Payment................................................ 42
SECTION IV.15. Article V of the Agreement................................. 42
SECTION V.1. Distributions................................................ 42
SECTION V.2. Monthly Series 1998-5 Certificateholders'
Statement......................................................... 43
SECTION V.3. Series 1998-5 Pay Out Events................................. 45
SECTION V.4. Issuance of Additional Certificates.......................... 47
SECTION V.5. Series 1998-5 Termination.................................... 48
SECTION V.6. Counterparts................................................. 48
<PAGE>
Page
----
SECTION V.7. Governing Law................................................ 48
SECTION V.8. No Petition.................................................. 48
SECTION V.9. Tax Representation and Covenant.............................. 48
SECTION V.10. Amendment to Agreement....................................... 49
EXHIBITS
EXHIBIT A-1 Form of Class A Certificate
EXHIBIT A-2 Form of Class B Certificate
EXHIBIT B Form of Monthly Payment Instructions
and Notification to the Trustee
EXHIBIT C Form of Monthly Series 1998-5 Certificateholders'
Statement
SCHEDULE I Schedule to Exhibit C of the Pooling and Servicing
Agreement with respect to the Investor
Certificates
