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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) June 4, 1996
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First USA, Inc.
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(Exact name of registrant as specified in its charter)
Delaware 1-11030 75-2291060
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(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation or Identification Number)
organization)
1601 Elm Street, 46th Floor, Dallas, Texas 75201
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(Address of principal executive offices) (Zip Code)
214-849-2444
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(Registrant's telephone number, including area code)
N/A
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(Former name, former address and former fiscal year,
if changed since last report.)
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Item 5. Other Events.
On June 4, 1996, First USA Bank (the "Bank"), a wholly-owned subsidiary
of First USA Financial, Inc., which is a wholly-owned subsidiary of First USA,
Inc., completed the securitization of approximately $723,000,000 of credit card
receivables. The securitization consists of floating rate asset backed
certificates, with two classes of publicly traded securities (Class A and Class
B) and a separate privately placed class of CIA Certificates representing CIA
Invested Amounts.
Series 1996-2 consists of $600,000,000 Class A Floating Rate Asset
Backed Certificates, and $54,300,000 Class B Floating Rate Asset Backed
Certificates, each of which has an average life of approximately seven years.
Series 1996-2 also consists of $68,700,000 CIA Certificates, which will be
subordinated to the Class A and Class B certificates and will provide credit
enhancement for the benefit of Class A and Class B certificateholders.
First USA Bank services the receivables that are included in the
securitization and will continue to service the accounts associated with such
receivables following the securitization.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(a) Not applicable.
(b) Not applicable.
(c) Exhibits.
1. Underwriting Agreement of First USA Credit Card Master Trust,
Series 1996-2, dated as of May 10, 1996, between First USA Bank, as Transferor
and Servicer, and Morgan Stanley & Co. Incorporated, as Representative of the
several Underwriters set forth therein.
99. Series 1996-2 Supplement, dated as of June 4, 1996, to the
Pooling and Servicing Agreement, dated as of September 1, 1992, between First
USA Bank, as Transferor and Servicer, and The Bank of New York (Delaware), as
Trustee.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
Date: June 28, 1996
First USA, Inc.
By: /s/ Steven L. McDonald
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Steven L. McDonald
Senior Vice President and
Chief Accounting Officer
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EXHIBIT INDEX
Exhibit No. Description
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1. Underwriting Agreement of First USA Credit Card Master Trust,
Series 1996-2, dated as of May 10, 1996, between First USA Bank,
as Transferor and Servicer, and Morgan Stanley & Co.
Incorporated, as Representative of the several Underwriters set
forth therein.
99. Series 1996-2 Supplement, dated as of June 4, 1996, to the
Pooling and Servicing Agreement, dated as of September 1, 1992,
between First USA Bank, as Transferor and Servicer, the The Bank
of New York (Delaware), as Trustee.
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EXHIBIT 1
First USA Credit Card Master Trust
Class A Floating Rate Asset Backed Certificates,
Series 1996-2
Class B Floating Rate Asset Backed Certificates,
Series 1996-2
UNDERWRITING AGREEMENT
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May 10, 1996
Morgan Stanley & Co. Incorporated
as Representative of the
Underwriters set forth herein
1585 Broadway
New York, New York 10036
Ladies and Gentlemen:
First USA Bank, a Delaware chartered banking corporation (the "Bank"),
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has duly authorized the issuance and sale to Morgan Stanley & Co. Incorporated
(the "Representative") and Bear, Stearns & Co. Inc., as underwriters (each
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individually, an "Underwriter" and collectively, the "Underwriters") of First
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USA Credit Card Master Trust $600,000,000 aggregate principal amount of Class A
Floating Rate Asset Backed Certificates, Series 1996-2 (the "Class A
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Certificates") and to Morgan Stanley & Co. Incorporated $45,000,000 to
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$75,000,000 aggregate principal amount of Class B Floating Rate Asset Backed
Certificates, Series 1996-2 (the "Class B Certificates" and together with the
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Class A Certificates, the "Certificates"). The Certificates will be issued
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pursuant to a Pooling and Servicing Agreement, dated as of September 1, 1992
(the "Master Pooling and Servicing Agreement"), by and between the Bank, as
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transferor and servicer, and The Bank of New York (Delaware) (the "Trustee")(as
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successor to The Bank of New York as successor to NationsBank, N.A.), as
supplemented by the Series 1996-2 Supplement dated as of June 4, 1996 (the
"Supplement" and together with the Master Pooling and Servicing Agreement, the
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"Pooling and Servicing Agreement"), by and between the Bank and the Trustee.
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Each Certificate will represent an undivided interest in certain
assets of First USA Credit Card Master Trust (the "Trust"). The property of the
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Trust will include, among other things, receivables (the "Receivables") arising
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under certain
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MasterCard(R) and VISA(R)* revolving credit card accounts (the "Accounts").
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Capitalized terms used and not otherwise defined herein shall have the
meanings ascribed thereto in the Pooling and Servicing Agreement.
1. Representations, Warranties and Agreements of the Bank. The Bank
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represents and warrants to, and agrees with, the Underwriters as follows:
(a) The Bank has filed with the Securities and Exchange
Commission (the "Commission"), on Form S-3, a registration statement, including
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a form of prospectus supplement (Registration No. 33-99362) pursuant to Rule 415
under the Securities Act of 1933, as amended (such act, the "Act"). The Bank may
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have filed one or more amendments thereto each of which amendments has
previously been furnished to each of the Underwriters. The Bank will also file
with the Commission a prospectus supplement in accordance with Rule 424(b) under
the Act. As filed, the registration statement as amended, the form of prospectus
supplement, and any prospectuses or prospectus supplements filed pursuant to
Rule 424(b) under the Act relating to the Certificates shall, except to the
extent that the Underwriters shall agree in writing to a modification, be in all
substantive respects in the form furnished to you prior to the Execution Time
or, to the extent not completed at the Execution Time, shall contain only such
specific additional information and other changes (beyond that contained in the
latest preliminary prospectus supplement which has previously been furnished to
the Underwriters) as the Bank has advised the Underwriters, prior to the
Execution Time, will be included or made therein.
For purposes of this Agreement, "Effective Time" means the date and
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time as of which such registration statement, or the most recent post-effective
amendment thereto, if any, was declared effective by the Commission, and
"Effective Date" means the date of the Effective Time. Such registration
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statement, as amended at the Effective Time, and including the exhibits thereto
and any material incorporated by reference therein, is hereinafter referred to
as the "Registration Statement," and any prospectus supplement (the "Prospectus
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Supplement") relating to the Certificates, as filed with the Commission pursuant
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to and in accordance with Rule 424(b) ("Rule 424(b)") under the Act is, together
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with the prospectus filed as part of the Registration Statement (such
prospectus, in the form it appears in the
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* VISA(R) and MasterCard(R) are registered trademarks of Visa USA
Incorporated and MasterCard International Incorporated, respectively.
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Registration Statement or in the form most recently revised and filed with the
Commission pursuant to Rule 424(b) being hereinafter referred to as the "Basic
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Prospectus"), hereinafter referred to as the "Prospectus". "Execution Time"
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shall mean the date and time that this Agreement is executed and delivered by
the parties hereto.
(b) On the Effective Date and on the date of this Agreement, the
Registration Statement did or will, and, when the Prospectus was first filed and
on the Closing Date, the Prospectus did or will, comply in all material respects
with the applicable requirements of the Act and the rules and regulations of the
Commission (the "Rules and Regulations"); on the Effective Date, the
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Registration Statement did not contain any untrue statement of a material fact
or omit to state any material fact required to be stated therein or necessary in
order to make the statements therein not misleading; and on the date of any
filing pursuant to Rule 424(b) and on the Closing Date, the Prospectus did not
or will not include any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided, however,
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that the Bank makes no representation or warranty as to the information
contained in or omitted from the Registration Statement or the Prospectus in
reliance upon and in conformity with information furnished in writing to the
Bank by the Underwriters specifically for use in connection with preparation of
the Registration Statement or the Prospectus.
(c) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, (i) there has not been any
material adverse change, or any development involving a prospective material
adverse change, in or affecting the general affairs, business, management,
financial condition, stockholders' equity, results of operations, regulatory
status or business prospects of the Bank and (ii) the Bank has not entered into
any transaction or agreement (whether or not in the ordinary course of business)
material to the Bank that, in either case, would reasonably be expected to
materially adversely affect the interests of the holders of the Certificates,
otherwise than as set forth or contemplated in the Prospectus.
(d) The Bank is duly organized, validly existing and in good standing
as a banking corporation under the laws of the State of Delaware and is
qualified to transact business in and is in good standing under the laws of each
state in which its activities require such qualification, and has full power,
authority and legal right to own its properties and conduct its business as such
properties are presently owned and such business is presently conducted, and to
execute, deliver and perform its obligations under this Agreement, the Spread
Account Agreement
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dated as of June 4, 1996 by and between the Bank and the Trustee (the "Spread
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Account Agreement"), the Pooling and Servicing Agreement, and the Certificates.
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(e) This Agreement has been duly authorized and validly executed and
delivered by the Bank.
(f) The Pooling and Servicing Agreement has been duly authorized and,
when executed and delivered by the Bank and assuming the due authorization,
execution and delivery thereof by the Trustee, will constitute a valid and
binding obligation of the Bank enforceable against the Bank in accordance with
its terms, subject to applicable bankruptcy, reorganization, insolvency and
similar laws affecting creditors' rights generally and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is pursuant to a proceeding in equity or at law). As of the Closing
Date, the Pooling and Servicing Agreement will have been duly and validly
executed by the Bank and will conform in all material respects to the
description thereof contained in the Prospectus.
(g) The Certificates have been duly and validly authorized by all
required action of the Bank, and when duly and validly executed by the Bank,
authenticated by the Trustee and delivered in accordance with the Pooling and
Servicing Agreement, and delivered to and paid for by the Underwriters as
provided herein, will be validly issued and outstanding and entitled to the
benefits of the Pooling and Servicing Agreement. As of the Closing Date, the
Certificates will have been duly and validly executed by the Bank, and will
conform in all material respects to the descriptions thereof contained in the
Prospectus.
(h) The Spread Account Agreement has been duly authorized, and when
executed and delivered by the Bank and assuming the due authorization, execution
and delivery thereof by the other parties thereto, will constitute a valid and
binding obligation of the Bank enforceable against the Bank in accordance with
its terms, subject to applicable bankruptcy, reorganization, insolvency and
similar laws affecting creditors' rights generally and subject, as to
enforceability, to general principles of equity (regardless of whether
enforcement is pursuant to a proceeding in equity or at law). As of the Closing
Date, the Spread Account Agreement will have been validly executed by the Bank.
(i) The Receivables delivered on the Closing Date to the Trustee
pursuant to the Pooling and Servicing Agreement will conform in all material
respects with the description thereof contained in the Prospectus.
(j) Neither the transfer of the Receivables to the Trustee, nor the
issuance, sale and delivery of the
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Certificates, nor the execution or delivery of this Agreement, the Spread
Account Agreement, or the Pooling and Servicing Agreement, nor the consummation
of any of the transactions herein or therein contemplated, nor the fulfillment
of the terms of the Certificates, the Pooling and Servicing Agreement, the
Spread Account Agreement or this Agreement, will result in the breach of any
term or provision of the charter or by-laws of the Bank, or conflict with,
result in a breach, violation or acceleration of, or constitute a default under,
the terms of any indenture or other agreement or instrument to which the Bank is
a party or by which it or its properties is bound or may be affected or any
statute, order or regulation applicable to the Bank of any court, regulatory
body, administrative agency, governmental body or arbitrator having jurisdiction
over the Bank or will result in the creation of any Lien upon any property or
assets of the Bank (other than as contemplated in the Pooling and Servicing
Agreement). The Bank is not a party to, bound by, or in breach or violation of,
any indenture or other agreement or instrument, or subject to or in violation of
any statute, order or regulation of any court, regulatory body, administrative
agency, governmental body or arbitrator having jurisdiction over it, that
materially and adversely affects the ability of the Bank to perform its
obligations under this Agreement, the Pooling and Servicing Agreement, the
Spread Account Agreement, or the Certificates.
(k) There are no charges, investigations, actions, suits, claims or
proceedings before or by any court, regulatory body, administrative agency,
governmental body or arbitrator now pending or, to the best knowledge of the
Bank, threatened that, separately or in the aggregate (i) could have a material
adverse effect on (x) the general affairs, business, management financial
condition, stockholders' equity, results of operations, regulatory status or
business prospects of the Bank or (y) the ability of the Bank to perform its
obligations under this Agreement, the Spread Account Agreement, the Pooling and
Servicing Agreement, or the Certificates, (ii) assert the invalidity of this
Agreement, the Spread Account Agreement, the Pooling and Servicing Agreement, or
the Certificates, (iii) seek to prevent the issuance, sale or delivery of the
Certificates or any of the transactions contemplated by this Agreement, the
Spread Account Agreement, or the Pooling and Servicing Agreement or (iv) seek to
affect adversely the federal income tax or ERISA attributes of the Certificates
described in the Prospectus.
(l) No federal, state or local tax, including intangibles tax or
documentary stamp tax, the non-payment of which would result in the imposition
of a Lien on the Receivables or of transferee liability on the Trustee, is
imposed with respect to the conveyance of the Receivables from the Bank to the
Trust, or in connection with the issuance of the Certificates by the Trust, or
the holding of the Receivables by the Trust, or in
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connection with any of the other transactions contemplated by this Agreement,
the Spread Account Agreement, or the Pooling and Servicing Agreement. Any
taxes, fees and other governmental charges in connection with the execution,
delivery and issuance of the Certificates or the execution and delivery of this
Agreement, the Spread Account Agreement, or the Pooling and Servicing Agreement
have been or will have been paid at or prior to the Closing Date.
(m) As of the Closing Date, the representations and warranties of the
Bank in the Pooling and Servicing Agreement, with regard to itself as both
seller and servicer and the Receivables (individually and in the aggregate),
will be true and correct.
(n) No consent, approval, authorization, order, registration or
qualification of or with any court or governmental agency or body is required
for the execution, delivery and performance by the Bank of or compliance by the
Bank with this Agreement, the Spread Account Agreement, the Pooling and
Servicing Agreement, or the Certificates or the consummation of the transactions
contemplated hereby or thereby except the filing of Uniform Commercial Code
financing statements with respect to the Receivables and to the approval of the
Office of the State Banking Commissioner of the State of Delaware.
(o) Ernst & Young LLP who have audited certain financial statements
of the Bank are independent public accountants as required by the Act and the
Rules and Regulations.
(p) As of the close of business on April 30, 1996, the Principal
Receivables transferred to the Trust pursuant to the Pooling and Servicing
Agreement have an aggregate balance determined, including the Receivables in the
Additional Accounts to be added to the Trust on or prior to the Closing Date, of
not less than the sum of (i) the sum of (x) the aggregate outstanding principal
amount of all classes of all Series then outstanding, plus (y) $723,000,000 plus
(ii) 7% of the sum of (x) plus (y).
(q) The Trust is not, and will not be as a result of the issuance and
sale of the Certificates, an "investment company" or a company "controlled by"
an investment company within the meaning of the Investment Company Act of 1940,
as amended (the "1940 Act").
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2. Purchase, Sale, Payment and Delivery of Certificates. On the
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basis of the representations, warranties and agreements herein contained, but
subject to the terms and conditions herein set forth, the Bank agrees to sell to
the Underwriters, and the Underwriters agree, severally and not jointly, to
purchase from the Bank, on June 4, 1996 or on such other date as shall be
mutually agreed upon by the Bank and the
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Underwriters (the "Closing Date"), the number and type of Certificates set forth
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in Schedule A opposite the name of each such Underwriter. The Class A
Certificates being purchased by the Underwriters hereunder are to be purchased
at a purchase price equal to 99.82% of the principal amount thereof plus accrued
interest from June 4, 1996, if the Closing Date agreed upon by the Bank and the
Underwriters is after June 4, 1996 and the Class A Certificates bear interest
from June 4, 1996. The Class B Certificates being purchased by the Underwriter
hereunder are to be purchased at a purchase price equal to 99.70% of the
principal amount thereof plus accrued interest from June 4, 1996, if the Closing
Date agreed upon by the Bank and the Underwriters is after June 4, 1996 and the
Class B Certificates bear interest from June 4, 1996.
The closing of the sale of the Certificates (the "Closing") shall be
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held at the offices of Skadden, Arps, Slate, Meagher & Flom, 919 Third Avenue,
New York, New York 10022, at 10:00 a.m., New York City time, on the Closing
Date. Payment of the purchase price for the Certificates being sold and
purchased hereunder shall be made on the Closing Date by wire transfer of
federal or other immediately available funds to an account to be designated one
business day prior to the Closing Date by the Bank, against delivery of the
Certificates at the Closing on the Closing Date. Each of the Certificates so to
be delivered shall be represented by one or more definitive certificates
registered in the name of Cede & Co., as nominee for The Depository Trust
Company.
3. Offering by Underwriters. It is understood that after the
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Effective Date the Underwriters propose to offer the Certificates for sale to
the public as set forth in the Prospectus.
4. Certain Agreements of the Bank. The Bank covenants and agrees
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with the several Underwriters as follows:
(a) Immediately following the execution of this 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 transmit the Prospectus including such Prospectus Supplement to the
Commission pursuant to Rule 424(b) by a means reasonably calculated to result in
filing that complies with all applicable provisions of Rule 424(b). The Bank
will advise you promptly of any such filing pursuant to Rule 424(b).
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(b) The Bank will advise you promptly of any proposal to amend or
supplement the Registration Statement or the Prospectus and will not effect such
amendment or supplement without your consent, which consent will not
unreasonably be withheld; the Bank will also advise you promptly of any request
by the Commission for any amendment of or supplement to the Registration
Statement or the Prospectus or for any additional information; and the Bank will
also advise you promptly of any amendment or supplement to the Registration
Statement or the Prospectus and of the issuance by the Commission of any stop
order suspending the effectiveness of the Registration Statement or the
institution or threat of any proceeding for that purpose and the Bank will use
its best efforts to prevent the issuance of any such stop order and to obtain as
soon as possible the lifting of any issued stop order.
(c) If, at any time when a prospectus relating to the Certificates is
required to be delivered under the Act, any event occurs as a result of which
the Prospectus as then amended or supplemented would include an untrue statement
of a material fact or omit to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading, or if it is necessary at any time to amend or supplement
the Prospectus to comply with the Act, the Bank promptly will advise you thereof
and will prepare and file, or cause to be prepared and filed, with the
Commission an amendment or supplement which will correct such statement or
omission, or an amendment or supplement which will effect such compliance. Any
such filing shall not operate as a waiver or limitation on any right of the
Underwriters hereunder.
(d) As soon as practicable, but not later than sixteen months after
the original effective date of the Registration Statement, the Bank will cause
the Trust to make generally available to Certificateholders an earnings
statement of the Trust covering a period of at least twelve months beginning
after the effective date of the Registration Statement which will satisfy the
provisions of Section 11(a) of the Act and Rule 158 promulgated thereunder.
(e) The Bank will furnish to the Underwriters copies of the
Registration Statement (one of which will be signed and will include all
exhibits), each related preliminary prospectus or prospectus supplement, the
Prospectus and all amendments and supplements to such documents, in each case as
soon as available and in such quantities as the Underwriters request.
(f) The Bank will promptly, from time to time, take such action as any
Underwriter may reasonably request to qualify the Certificates for offering and
sale under the securities laws of such jurisdictions as such Underwriter may
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request and to comply with such laws so as to permit the continuance of sales
and dealings therein in such jurisdictions for as long as may be necessary to
complete the distribution of the Certificates, provided that in connection
therewith the Bank shall not be required to qualify as a foreign corporation or
dealer in securities or to file a general consent to service of process in any
jurisdiction.
(g) For a period from the date of this Agreement until the retirement
of the Certificates, the Bank will deliver to you the annual statements of
compliance and the annual independent certified public accountants' reports
furnished to the Trustee pursuant to the Pooling and Servicing Agreement, as
soon as such statements and reports are furnished to the Trustee.
(h) So long as any of the Certificates is outstanding, the Bank will
furnish to you (i) as soon as practicable after the end of the fiscal year all
documents required to be distributed to Certificateholders or filed with the
Commission pursuant to the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), or any order of the Commission thereunder and (ii) from time to
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time, any other information concerning the Bank filed with any government or
regulatory authority which is otherwise publicly available, as you reasonably
request.
(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 use its best efforts to furnish
such documents and take any such other actions.
5. Payment of Expenses. The Bank will pay all expenses incident to
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the performance of its obligations under this Agreement, including (i) the
printing of the Prospectus and of each amendment or supplement thereto, (ii) the
preparation of this Agreement, the Spread Account Agreement, and the Pooling and
Servicing Agreement, (iii) the preparation, issuance and delivery of the
Certificates to the Underwriters, (iv) the fees and disbursements of the Bank's
counsel and accountants, (v) the qualification of the Certificates under
securities laws in accordance with the provisions of Section 4(f) hereof,
including filing fees and the fees and disbursements of counsel for the
Underwriters and in connection with the preparation of any blue sky and legal
investment survey, (vi) the printing and delivery to the Underwriters of copies
of the Prospectus and of each amendment or supplement thereto, (vii) the
printing and delivery to the Underwriters of copies of any blue sky or legal
investment survey prepared in connection with the Certificates, (viii) any fees
charged by rating agencies for the rating of the Certificates, (ix) the fees and
expenses, if any, incurred with respect to any filing with the National
Association of Securities
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Dealers, Inc. and (x) the fees and expenses of the Trustee and its counsel.
6. Conditions of the Obligations of the Underwriters. The
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obligations of the several Underwriters to purchase and pay for the Certificates
will be subject to the accuracy of the representations and warranties on the
part of the Bank herein, to the accuracy of the statements of officers of the
Bank made pursuant to the provisions hereof, to the performance by the Bank of
its obligations hereunder and to the following additional conditions precedent:
(a) The Prospectus and any supplements thereto shall have been
filed (if required) with the Commission in accordance with the rules and
regulations under the Act and Section 1 hereof, and prior to the Closing Date,
no stop order suspending the effectiveness of the Registration Statement shall
have been issued and no proceedings for that purpose shall have been instituted
or, to the knowledge of the Bank, shall be contemplated by the Commission or by
any authority administering any state securities or blue sky law.
(b) On or prior to the date of the Prospectus and on or prior to
the Closing Date, the Underwriters shall have received a letter or letters,
dated as of the date of the Prospectus and as of the Closing Date, respectively,
of Ernst & Young LLP, Certified Public Accountants, substantially in the form of
the drafts to which you have previously agreed and otherwise in form and
substance satisfactory to you and your counsel.
(c) Subsequent to the execution and delivery 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 Trust, or the Bank which, in the judgment of the Representative, materially
impairs the investment quality of the Certificates or makes it impractical or
inadvisable to market the Certificates; (ii) any suspension or limitation on
trading in securities generally on the New York Stock Exchange or the National
Association of Securities Dealers National Market system, or any setting of
minimum prices for trading on such exchange or market system; (iii) any
suspension of trading of any securities of First USA, Inc. on any exchange or in
the over-the-counter market which materially impairs the investment quality of
the Certificates or makes it impractical or inadvisable to market the
Certificates; (iv) any banking moratorium declared by Federal, Delaware or New
York authorities; or (v) any outbreak or escalation of major hostilities or
armed conflict, any declaration of war by Congress, or any other substantial
national or international calamity or emergency if, in the judgment of the
Representative, the effect of any such outbreak, escalation, declaration,
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calamity, or emergency makes it impractical or inadvisable to proceed with
completion of the sale of and payment for the Certificates.
(d) At the Closing Date, the Bank shall have furnished to you
certificates of an executive officer of the Bank as to the accuracy of the
representations and warranties of the Bank herein at and as of the Closing Date,
as to the performance by the Bank of all of its obligations hereunder to be
performed at or prior to such Closing Date, and as to such other matters as you
may reasonably request.
(e) David L. Nelson, counsel for the Bank, shall have furnished to you
his written opinion, addressed to you and dated the Closing Date, in form and
substance satisfactory to you and your counsel, substantially to the effect
that:
(i) The Bank has been duly incorporated and is validly
existing as a bank in good standing under the laws of the State of
Delaware with full power and authority (corporate and other) to own
its properties and conduct its business, as presently owned and
conducted by it, and to enter into and perform its obligations under
this Agreement, the Spread Account Agreement and the Pooling and
Servicing Agreement (collectively, referred to in this subsection (e)
as the "Agreements"), and the Certificates and had at all times, and
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now has, the power, authority and legal right to acquire, own and
transfer the Receivables;
(ii) The Bank is duly qualified to do business and is in
good standing, and under state laws, as they are currently interpreted
and enforced, has obtained all necessary licenses and approvals in
each jurisdiction in which failure to qualify or to obtain such
licenses or approvals would materially and adversely affect the
enforceability of any Receivable by the Bank or the Trustee or would
adversely affect the ability of the Bank to perform its obligations
under the Agreements or the Certificates;
(iii) The Certificates have been duly authorized, executed
and delivered by the Bank and, when duly authenticated by the Trustee
in accordance with the terms of the Pooling and Servicing Agreement
and delivered to and paid for by the Underwriters
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in accordance with the terms of this Agreement, will be validly issued
and outstanding and entitled to the benefits provided by the Pooling
and Servicing Agreement;
(iv) Each of the Agreements has been duly authorized,
executed and delivered by the Bank and constitutes the legal, valid
and binding agreement of the Bank enforceable against the Bank in
accordance with its terms, subject, as to enforceability to (A) the
effect of bankruptcy, insolvency, moratorium, receivership,
reorganization, liquidation and other similar laws relating to or
affecting the rights and remedies of creditors generally, and (B) the
application of principles of equity (regardless of whether considered
and applied in a proceeding in equity or at law) and the rights and
powers of the FDIC;
(v) The Trust is not now, and immediately following the sale
of the Certificates pursuant to the Underwriting Agreement will not
be, required to register under the 1940 Act;
(vi) No consent, approval, authorization or order of any
governmental agency or body is required for (A) the execution,
delivery and performance by the Bank of its obligations under the
Agreements or the Certificates, or (B) the issuance or sale of the
Certificates, except such as have been obtained under the Act and as
may be required under state securities or blue sky laws in connection
with the purchase and distribution of the Certificates by the
Underwriters and the filing of Uniform Commercial Code financing
statements with respect to the Receivables and the approval of the
Office of the State Banking Commissioner of the State of Delaware;
(vii) To the best knowledge of such counsel, neither the
execution and delivery of the Agreements or the Certificates by the
Bank nor the performance by the Bank of the transactions therein
contemplated nor the fulfillment of the terms thereof does or will
result in any violation of any statute or regulation or any order or
decree of
12
<PAGE>
any court or governmental authority binding upon the Bank or its
property, or conflict with, or result in a breach or violation of any
term or provision of, or result in a default under any of the terms
and provisions of, the Bank's charter or by-laws or any material
indenture, loan agreement or other material agreement to which the
Bank is a party or by which the Bank is bound;
(viii) To the knowledge of such counsel after due
investigation, there are no legal or governmental proceedings pending
to which the Bank is a party or to which the Bank is subject which,
individually or in the aggregate (A) would have a material adverse
effect on the ability of the Bank to perform its obligations under the
Agreements or the Certificates, (B) assert the invalidity of the
Agreements or the Certificates, (C) seek to prevent the issuance, sale
or delivery of the Certificates or any of the transactions
contemplated by the Agreements or (D) seek to affect adversely the
federal income tax or ERISA attributes of the Certificates described
in the Prospectus;
(ix) The Registration Statement and the Prospectus (except
for the financial statements, financial schedules and other financial
and operating data included therein, as to which such counsel
expresses no view) comply as to form with the Act and the Rules and
Regulations;
(x) The Registration Statement has become effective under
the Act, and the Prospectus Supplement will be filed with the
Commission pursuant to Rule 424(b) thereunder; and
(xi) Such counsel has not independently verified and is not
passing upon, and does not assume any responsibility for, the
accuracy, completeness or fairness of the information contained in the
Registration Statement and Prospectus. Based upon discussion with the
Bank, its accountants and others, however, no facts have come to its
attention that cause it to believe that the Prospectus (except for the
financial statements, financial schedules and other
13
<PAGE>
financial and statistical data included therein, as to which such
counsel expresses no view), contains any untrue statement of a
material fact or omits to state a material fact required to be stated
therein or necessary in order to make the statements therein not
misleading.
(f) You shall have received a letter of Skadden, Arps, Slate,
Meagher & Flom, special counsel for the Bank, to the effect that you may
rely on those provisions of their opinions to Moody's Investors Service,
Inc. and Standard & Poor's Ratings Services, a Division of The McGraw-Hill
Companies, Inc. ("Standard & Poor's") with respect to certain matters
-----------------
relating to the transfer of the Receivables to the Trust, with respect to
the perfection of the Trust's interest in the Receivables and with respect
to other related matters.
(g) You shall have received an opinion of Skadden, Arps, Slate,
Meagher & Flom, special counsel to the Bank, addressed to you, dated the
Closing Date and satisfactory in form and substance to you and your
counsel, to the effect that the Certificates will be treated as
indebtedness for Federal income tax purposes and for Delaware income tax
purposes.
(h) You shall have received from Skadden, Arps, Slate, Meagher &
Flom, counsel for the Underwriters, such opinion or opinions, dated the
Closing Date, substantially to the effect that:
(i) Each of the Pooling and Servicing Agreement and the
Spread Account Agreement (collectively referred to in this subsection
(h) as the "Agreements") constitutes the valid and binding obligation
----------
of the Bank, enforceable against the Bank in accordance with its
terms, except (x) to the extent that the enforceability thereof may be
limited by (a) bankruptcy, insolvency, receivership, reorganization,
moratorium or other similar laws now or hereafter in effect relating
to creditors' rights generally and the rights of creditors of Delaware
chartered banks as the same may be applied in the event of the
bankruptcy, insolvency, receivership, reorganization, moratorium or
other similar event in respect of the Bank, (b) general principles of
equity (regardless of whether enforceability is considered in a
proceeding at law or in equity) and (c) the qualification that certain
14
<PAGE>
of the remedial provisions of the Agreements may be unenforceable in
whole or in part, but the inclusion of such provisions does not affect
the validity of the Agreements taken as a whole, and the Agreements,
together with applicable law, contain adequate provisions for the
practical realization of the benefits of the security created thereby
and (y) such counsel expresses no opinion as to the enforceability of
any rights to contribution or indemnification which are violative of
public policy underlying any law, rule or regulation;
(ii) The Certificates, when executed and authenticated in
accordance with the terms of the Pooling and Servicing Agreement and
delivered to and paid for by the Underwriters pursuant to this
Agreement, will be duly and validly issued and outstanding and will be
entitled to the benefits of the Pooling and Servicing Agreement;
(iii) This Agreement has been duly authorized, executed and
delivered by the Bank;
(iv) Neither the execution, delivery or performance by the
Bank of the Agreements or this Agreement, nor the compliance by the
Bank with the terms and provisions thereof or hereof, will contravene
any provision of any applicable law;
(v) Based on such counsel's review of applicable laws, no
governmental approval, which has not been obtained or taken and is not
in full force and effect, is required to authorize or is required in
connection with the execution, delivery or performance of the
Agreements by the Bank;
(vi) The Certificates, the Agreements and this Agreement
conform in all material respects to the descriptions thereof contained
in the Prospectus;
(vii) The Pooling and Servicing Agreement is not required
to be qualified under the Trust Indenture Act of 1939, as amended, and
the Trust is not required to be registered under the 1940 Act;
15
<PAGE>
(viii) The statements in the Prospectus under the heading
"Certain Legal Aspects of the Receivables", to the extent that they
constitute matters of law or legal conclusions with respect thereto,
have been reviewed by such counsel and are correct in all material
respects; and
(ix) Each of the Registration Statement, as of its
effective date, and the Prospectus, as of its date, appeared on its
face to be appropriately responsive in all material respects to the
requirements of the Act and the General Rules and Regulations under
the Act, except that in each case such counsel expresses no opinion as
to the financial data included therein or excluded therefrom or the
exhibits to the Registration Statement, and such counsel does not
assume any responsibility for the accuracy, completeness or fairness
of the statements contained in the Registration Statement and the
Prospectus.
Such opinion shall also state that such counsel has participated
in conferences with officers and representatives of the Bank, counsel for
the Bank, representatives of the independent accountants of the Bank and
the Underwriters at which the contents of the Prospectus and related
matters were discussed and, although such counsel need not pass upon, and
need not assume any responsibility for, the accuracy, completeness or
fairness of the statements contained in the Prospectus and shall have made
no independent check or verification thereof, except for those made under
the caption "Certain Legal Aspects of the Receivables" to the extent set
forth in paragraph (viii) above, on the basis of the foregoing, no facts
shall have come to such counsel's attention that shall have led such
counsel to believe that the Prospectus, as of its date, contained an untrue
statement of a material fact or omitted to state a material fact necessary
in order to make the statements therein, in light of the circumstances
under which they were made, not misleading, except that such counsel need
not express an opinion or belief with respect to the financial statements,
schedules and other financial information included in such opinion or
excluded therefrom.
(i) McGuire Woods Battle & Boothe, L.L.P., counsel for The Bank
of New York, a New York banking corporation (the "Agent"), in connection
-----
with
16
<PAGE>
the Agency Agreement dated as of December 4, 1995 between the Agent and the
Trustee (the "Agency Agreement"), and counsel for the Trustee, shall have
----------------
furnished to you their written opinion, addressed to you and dated the
Closing Date, in form and substance satisfactory to you and your counsel,
substantially to the effect that:
(i) the Agent is a banking corporation duly organized,
validly existing and in good standing under the laws of the State of
New York and has the corporate power and authority to execute, deliver
and perform its obligations under the Agency Agreement;
(ii) the Certificates have been duly authenticated by the
Agent pursuant to the Agency Agreement and in accordance with the
Pooling and Servicing Agreement;
(iii) the Trustee has been duly incorporated, and is validly
existing in good standing as a banking corporation under the laws of
the State of Delaware and has the corporate power and authority to
execute, deliver and perform its obligations under the Supplement and
to perform its obligations under the Pooling and Servicing Agreement;
(iv) each of the Supplement and the Spread Account Agreement
has been duly authorized, executed and delivered by the Trustee, and
each of the Pooling and Servicing Agreement and the Spread Account
Agreement constitutes the valid and binding obligation of the Trustee,
enforceable against the Trustee in accordance with its terms, except
(x) to the extent that the enforceability thereof may be limited by
(a) bankruptcy, insolvency, receivership, reorganization, moratorium
or other similar laws now or hereafter in effect relating to
creditors' rights generally and the rights of creditors of Delaware
chartered banks as the same may be applied in the event of the
bankruptcy, insolvency, receivership, reorganization, moratorium or
other similar event in respect of the Trustee, (b) general principles
of equity (regardless of whether enforceability is considered in a
proceeding at law or in equity) and (c) the qualification that certain
of the remedial provisions of the Pooling and
17
<PAGE>
Servicing may be unenforceable in whole or in part, but the inclusion
of such provisions does not affect the validity of the Pooling and
Servicing taken as a whole, and the Pooling and Servicing Agreement,
together with applicable law, contain adequate provisions for the
practical realization of the benefits of the security created thereby
and (y) such counsel expresses no opinion as to the enforceability of
any rights to contribution or indemnification which are violative of
public policy underlying any law, rule or regulation;
(v) the execution and delivery of the Supplement and the
Spread Account Agreement and the performance of the terms thereof and
of the Pooling and Servicing Agreement, by the Trustee does not
conflict with or constitute a breach of or default under the charter
or by-laws of the Trustee or any agreement, indenture or other
instrument, in each case known to us, to which the Trustee is a party
or by which it or any of its properties may be bound, and does not
violate any law, governmental rule or regulation of the State of
Delaware or any federal law of the United States of America governing
the banking or trust powers of the Trustee or any court decree known
to us to be applicable to the Trustee; and
(vi) no consent, approval or authorization of, or
registration, declaration or filing with, any court or governmental
agency or body having jurisdiction in the premises is required under
Delaware law for the valid execution and delivery by the Trustee of
the Supplement and the Spread Account Agreement, or the performance of
the terms thereof or of the Pooling and Servicing Agreement.
(j) You shall have received evidence satisfactory to you and
your counsel that, on or before the Closing Date, UCC-1 financing
statements have been filed in the appropriate filing offices of the State
of Delaware and such other jurisdictions as counsel to the Bank deems
appropriate to reflect the interest of the Trustee in the Receivables.
18
<PAGE>
(k) The Class A Certificates shall be rated "AAA" by Standard &
Poor's and "Aaa" by Moody's Investors Service, Inc. and the Class B
Certificates shall be rated at least "A" by Standard & Poor's and rated at
least "A2" by Moody's Investors Service, Inc. on the Closing Date, and
letters to such effect dated the Closing Date shall have been received from
each Rating Agency.
(l) You shall have received evidence satisfactory to you that,
on or before the Closing Date, the Bank shall have received the approval of
the Office of the State Banking Commissioner of the State of Delaware to
the transaction .
(m) All proceedings in connection with the transactions
contemplated by this Agreement and all documents incident thereto shall be
satisfactory in form and substance to you and your counsel, and you and
your counsel shall have received such information, certificates and
documents as any of them may reasonably request.
7. Indemnification and Contribution.
--------------------------------
(a) The Bank agrees to indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter within
the meaning of Section 15 of the Act and under Section 20 of the Exchange
Act against any and all losses, claims, damages or liabilities to which
they may become subject insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in the Registration Statement, the Prospectus, or in any revision
or amendment thereof or supplement thereto or any related preliminary
prospectus, 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 defending any
such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the Bank will not be liable in any such
-------- -------
case to the extent that any such loss, claim, damage or liability arises
out of or is based upon an untrue statement or alleged untrue statement or
omission or alleged omission made therein in reliance upon and in
conformity with written information furnished to the Bank by any
Underwriter specifically for use therein or
19
<PAGE>
any revision or amendment thereof or supplement thereto. The foregoing
indemnification with respect to any preliminary prospectus or prospectus
supplement shall not inure to the benefit of any Underwriter from whom the
person asserting any such losses, claims, damages or liabilities purchased
Certificates, or any person controlling such Underwriter, if a copy of the
Prospectus (as then amended or supplemented if the Bank shall have
furnished any amendments or supplements thereto) was not sent or given by
or on behalf of such Underwriter to such person, if such is required by
law, at or prior to the written confirmation of the sale of such
Certificates to such person and if the Prospectus (as so amended or
supplemented) would have cured the defect giving rise to such loss, claim,
damage or liability provided that the Bank shall have identified to such
Underwriter in writing such defect prior to the delivery of such written
confirmation by such Underwriter to such person.
(b) Each Underwriter severally and not jointly agrees to
indemnify and hold harmless the Bank, its directors, each of the Bank's
officers who signed the Registration Statement and each person, if any, who
controls the Bank within the meaning of Section 15 of the Act and under
Section 20 of the Exchange Act against any and all losses, claims, damages
or liabilities to which they may become subject insofar as such losses,
claims, damages or liabilities (or actions in respect thereof) arise out of
or are based upon any untrue statement or alleged untrue statement of any
material fact contained in the Registration Statement, the Prospectus, or
in any revision or amendment thereof or supplement thereto or any related
preliminary prospectus or prospectus supplement, 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, in each case to the extent, but only to the extent,
that such untrue statement or alleged untrue statement or omission or
alleged omission was made in reliance upon and in conformity with written
information furnished to the Bank by such Underwriter specifically for use
therein or any revision or amendment thereof or supplement thereto, and
agrees to reimburse such indemnified party for any legal or other expenses
reasonably incurred by them in connection with investigating or defending
any such loss, claim, damage or liability or action as such expenses are
incurred.
(c) Promptly after receipt by an indemnified party under this
Section 7 of the commencement of any action, such indemnified party will,
if a claim in
20
<PAGE>
respect thereof is to be made against the indemnifying party under this
Section 7, notify the indemnifying party in writing of the commencement
thereof; but the omission so to notify the indemnifying party will not
relieve the indemnifying party from any liability which it may have to any
indemnified party otherwise than under this Section 7. In case any such
action is brought against any indemnified party and it notified the
indemnifying party of the commencement thereof, the indemnifying party will
be entitled to participate therein and, to the extent that it may elect by
written notice delivered to the indemnified party promptly after receiving
the aforesaid notice from such indemnified party, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified party
(who shall not, except with the consent of the indemnified party, be
counsel to the indemnifying party), and after notice from the indemnifying
party to such indemnified party of its election so to assume the defense
thereof, the indemnifying party will not be liable to such indemnified
party under this Section 7 for any legal or other expenses subsequently
incurred by such indemnified party in connection with the defense thereof
other than reasonable costs of investigation. No indemnifying party shall,
without the prior written consent of the indemnified party, effect any
settlement of any pending or threatened proceeding in respect of which any
indemnified party is or could have been a party and indemnity could have
been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all
liability on claims that are the subject matter of such proceeding.
(d) If the indemnification provided for in this Section 7 is
unavailable or insufficient to hold harmless an indemnified party under
subsection (a) or (b) above, then each indemnifying party shall contribute
to the amount paid or payable by such indemnifying party as a result of the
losses, claims, damages or liabilities referred to in subsection (a) or (b)
above (i) in such proportion as is appropriate to reflect the relative
benefits received by the Bank on the one hand and the respective
Underwriter on the other from the offering of the Certificates or (ii) if
the allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of the
Bank on the one hand and of the respective Underwriter on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities as well as any other relevant equitable
considerations.
21
<PAGE>
The relative benefits received by the Bank on the one hand and the
respective Underwriter on the other shall be deemed to be in the same
proportion as the total net proceeds from the offering (before deducting
expenses) received by the Bank bear to the total underwriting discounts and
commissions received by such Underwriter. The relative fault shall be
determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or the omission or alleged
omission to state a material fact relates to information supplied by the
Bank or by any Underwriter and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such untrue
statement or omission. The amount paid by an indemnified party as a result
of the losses, claims, damages or liabilities referred to in the first
sentence of this subsection (d) shall be deemed to include any legal or
other expenses reasonably incurred by such indemnified party in connection
with investigating or defending any action or claim which is the subject of
this subsection (d). Notwithstanding the provisions of this subsection
(d), each Underwriter shall not be required to contribute any amount in
excess of the underwriting discount or commission applicable to the
Certificates purchased by it hereunder. The Bank and the Underwriters
agree that it would not be just and equitable if contribution pursuant to
this subsection (d) were determined by pro rata allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other
method of allocation which does not take account of any of the equitable
considerations referred to above in this subsection (d). No person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of the
Act) shall be entitled to contribution from any person who was not guilty
of such fraudulent misrepresentation.
8. Survival. The Bank and the Underwriters agree that the
--------
respective representations, warranties and agreements made by them herein
and in any certificate or other instrument delivered pursuant hereto shall
be deemed to be relied upon, in the case of the Bank, by each Underwriter
and, in the case of the Underwriters, by the Bank, notwithstanding any
investigation heretofore or hereafter made by or on behalf of the Bank or
the Underwriters, and that the respective representations, warranties and
agreements (including without limitation the indemnity and contribution
agreement) made by the Bank and the Underwriters herein or in any such
certificate or other instrument shall survive the delivery of and payment
for the Certificates.
22
<PAGE>
9. Termination. This Agreement may be terminated in the sole
-----------
discretion of the Underwriters by notice to the Bank given at or prior to
the Closing Date in the event that the Bank shall have failed, refused or
been unable to perform all obligations and satisfy all conditions on its
part to be performed or satisfied hereunder at or prior thereto.
Termination of this Agreement pursuant to this Section 9 shall be without
liability of any party to any other party except as provided in Sections 5
and 7 hereof.
10. Default by One or More of the Underwriters. If one or more
------------------------------------------
of the Underwriters shall fail on the Closing Date to purchase the
Certificates which it or they are obligated to purchase under this
Agreement (the "Defaulted Securities"), the lead Underwriter shall have the
--------------------
right, within 24 hours thereafter, to make arrangements for one or more of
the non-defaulting Underwriters, or any other underwriters, to purchase
all, but not less than all, of the Defaulted Securities in such amounts as
may be agreed upon and upon the terms herein set forth; if, however, the
Representative shall not have completed such arrangements within such 24-
hour period, then:
(a) if the aggregate amount of Defaulted Securities does not exceed
10% of the aggregate principal amount of the applicable class of
Certificates, each of the non-defaulting Underwriters of such class of
Certificates shall be obligated to purchase the full amount thereof in
the proportions that their respective underwriting obligations
hereunder with respect to such class of Certificates bear to the
underwriting obligations of all non-defaulting Underwriters of such
class of Certificates, or
(b) if the aggregate amount of Defaulted Securities exceeds 10% of
the aggregate principal amount of the applicable class of
Certificates, this Agreement shall terminate without liability on the
part of any non-defaulting Underwriter.
No action taken pursuant to this section shall relieve any defaulting
Underwriter from liability in respect of its default.
In the event of any such default which does not result in a
termination of this Agreement, either the Representative or the Bank shall
have the right to postpone the Closing Date for a period not exceeding
seven days in order to effect any required changes in the
23
<PAGE>
Registration Statement or Prospectus or in any other documents or
arrangements.
11. Representation of the Underwriters. Each of the
----------------------------------
Underwriters represents and warrants to, and agrees with, the Bank that (w)
it has not offered or sold, and shall not offer or sell any Certificates to
persons in the United Kingdom except to persons whose ordinary activities
involve them in acquiring, holding, managing or disposing of investments
(as principal or agent) for the purposes of their businesses or otherwise
in circumstances which do not constitute an offer to the public in the
United Kingdom for the purposes of the Public Offers of Securities
Regulations 1995, (x) it has complied with and shall comply with all
applicable provisions of the Financial Services Act 1986 of Great Britain
with respect to anything done by it in connection with the Certificates in,
from or otherwise involving the United Kingdom and (y) it has only issued
or passed on and shall only issue or pass on in the United Kingdom any
document in connection with the issue or sale of the Certificates to a
person who is of a kind described in Article 8 of the Financial Services
Act 1986 (Investment Advertisements) (Exemptions) (No. 2) Order 1995 of
Great Britain or is a person to whom the document may otherwise lawfully be
issued or be passed on.
12. Notices. All communications provided for or permitted
-------
hereunder shall be in writing and shall be deemed to have been duly given
if personally delivered, sent by overnight courier or mailed by registered
mail, postage prepaid and return receipt requested, or transmitted by
telex, telegraph or telecopier and confirmed by a similar mailed writing,
if to (a) the Underwriters, addressed to Morgan Stanley & Co. Incorporated,
1585 Broadway, New York, New York 10036, Attention: Caroline C. Morrill, or
to such other address as the Underwriters may designate in writing to the
Bank or (b) the Bank, addressed to the Bank at 201 North Walnut Street,
Wilmington, Delaware 19801, Attention: Executive Vice President - Finance &
Accounting, with a copy to First USA, Inc., 1601 Elm Street, 46th Floor,
Dallas, Texas 75201, Attention: Senior Vice President - Finance &
Accounting.
13. Computational Materials. Each Underwriter, severally,
-----------------------
represents and warrants to the Bank that (a) it has not and will not use
any information that constitutes "Computational Materials," as defined in
the Commission's No-Action Letter, dated May 20, 1994, addressed to Kidder,
Peabody Acceptance Corpo-
24
<PAGE>
ration I, Kidder, Peabody & Co. Incorporated and Kidder Structured Asset
Corporation (as made generally applicable to registrants, issuers and
underwriters by the Commission's response to the request of the Public
Securities Association dated May 27, 1994), with respect to the offering of
the Certificates unless it has obtained the prior written consent of the
Bank to such usage and (b) it has not and will not use any information that
constitutes "ABS Term Sheets" as defined in the Commission's No-Action
Letter, dated February 13, 1995, addressed to the Public Securities
Association, with respect to the offering of the Certificates.
14. Secondary Trusts. Each Underwriter, severally, represents
----------------
that it will not, at any time that such Underwriter is acting as an
"underwriter" (as defined in Section 2(11) of the Act) with respect to the
Certificates, transfer, deposit or otherwise convey any Certificates into a
trust or other type of special purpose vehicle that issues securities or
other instruments backed in whole or in part by, or that represents
interests in, such Certificates without the prior written consent of the
Bank.
15. Successors. This Agreement shall inure to the benefit of
----------
and be binding upon the parties hereto and their respective successors and
assigns. Nothing expressed herein is intended or shall be construed to
give any person other than the persons referred to in the preceding
sentence any legal or equitable right, remedy or claim under or in respect
of this Agreement.
16. Severability of Provisions. Any covenant, provision,
--------------------------
agreement or term of this Agreement that is prohibited or is held to be
void or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability
without invalidating the remaining provisions hereof.
17. Entire Agreement. This Agreement constitutes the entire
----------------
agreement and understanding of the parties hereto with respect to the
matters and transactions contemplated hereby and supersedes all prior
agreements and understandings whatsoever relating to such matters and
transactions.
18. Amendment. 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.
25
<PAGE>
19. Headings. The headings in this Agreement are for the
--------
purposes of reference only and shall not limit or otherwise affect the
meaning hereof.
20. Counterparts. This Agreement may be executed in
------------
counterparts, each of which shall constitute an original, but all of which
shall together constitute one instrument.
21. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND
-------------
CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT
REGARD TO THE CONFLICT OF LAW PROVISIONS THEREOF.
26
<PAGE>
If the foregoing is in accordance with your understanding of our
agreement, kindly sign and return to us the enclosed duplicate hereof,
whereupon it will be a binding agreement among the undersigned in
accordance with its terms.
Very truly yours,
FIRST USA BANK,
as Transferor and Servicer
By: /s/Steven L. McDonald
---------------------------
Name: Steven L. McDonald
Title: Senior Vice President
The foregoing Underwriting Agreement
is hereby agreed to as of the date
first above written.
MORGAN STANLEY & CO. INCORPORATED
for itself and as Representative
of the several Underwriters named
in Schedule A hereto
By: /s/David R. Warren
-------------------------------
Name: David R. Warren
Title: Managing Director
<PAGE>
SCHEDULE A
Aggregate Principal
Amount of the Class A
Underwriter Certificates
----------- ------------
Morgan Stanley & Co.
Incorporated . . . . . $300,000,000
Bear, Stearns & Co. Inc. . . . $300,000,000
Total . . . . . . . . . $600,000,000
Aggregate Principal
Amount of the Class B
Underwriter Certificates
----------- ------------
Morgan Stanley & Co.
Incorporated . . . . $45,000,000 to $75,000,000
Total . . . . . . . . . $45,000,000 to $75,000,000
<PAGE>
EXHIBIT 99
- --------------------------------------------------------------------------------
FIRST USA BANK
Transferor and Servicer
and
THE BANK OF NEW YORK (DELAWARE)
on behalf of the Certificateholders
_____________________________
SERIES 1996-2 SUPPLEMENT
Dated as of June 4, 1996
to
POOLING AND SERVICING AGREEMENT
Dated as of September 1, 1992, as amended
_____________________________
$723,000,000
FIRST USA CREDIT CARD MASTER TRUST
Series 1996-2
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Page
----
SECTION 1. Designation.......................................... 1
SECTION 2. Definitions.......................................... 2
SECTION 3. Reassignment and
Transfer Terms....................................... 26
SECTION 4. Delivery and Payment
for the Series 1996-2
Certificates......................................... 27
SECTION 5. Depositary; Form of
Delivery of Series
1996-2 Certificates.................................. 27
SECTION 6. Article IV of Agree-
ment................................................. 27
Article IV Rights of Certificate
holders and Allocation
and Application of
Collections.......................................... 29
Section 4.04 Rights of Certificate-
holders.............................................. 29
Section 4.05 Collections and Allo-
cation............................................... 29
Section 4.06 Determination of
Monthly Interest for
the Series 1996-2 Cer-
tificates............................................ 35
Section 4.07 Determination of
Monthly Principal.................................... 38
Section 4.08 Coverage of Required
Amount for the Inves-
tor Certificates..................................... 39
Section 4.09 Monthly Payments..................................... 40
i
<PAGE>
Page
----
Section 4.10 Payment of Certificate
Interest............................................. 46
Section 4.11 [Reserved]........................................... 46
Section 4.12 Investor Charge-Offs................................. 46
Section 4.13 Excess Finance Charge
Collections for the
Series 1996-2 Certifi-
cates................................................ 48
Section 4.14 Reallocated Principal
Collections for the
Series 1996-2 Certifi-
cates................................................ 51
Section 4.15 Determination of LIBOR............................... 53
Section 4.16 Principal Funding Ac-
count................................................ 54
Section 4.17 Reserve Account...................................... 55
SECTION 7. Article V of the
Agreement............................................ 58
Article V Distributions and
Reports to Investor
Certificateholders................................... 58
Section 5.01 Distributions........................................ 58
Section 5.02 Monthly
Certificateholders'
Statement............................................ 60
Section 5.03 Rule 144A Information................................ 63
SECTION 8. Series 1996-2 Pay Out
Events............................................... 63
SECTION 9. Series 1996-2 Termina-
tion................................................. 65
SECTION 10. Periodic Finance
Charges and Other Fees............................... 65
ii
<PAGE>
Page
----
SECTION 11. Transfers of CIA Cer-
tificates; Legends................................... 65
SECTION 12. Compliance with With-
holding Requirements................................. 70
SECTION 13. Tax Characterization
of the CIA Certifi-
cates................................................ 70
SECTION 14. ERISA Legend......................................... 70
SECTION 15. Amendment and Ratifi-
cation of Agreement.................................. 71
SECTION 16. Counterparts......................................... 71
SECTION 17. GOVERNING LAW........................................ 71
SECTION 18. Additional Representa-
tions and Warranties
of the Servicer...................................... 72
EXHIBITS
EXHIBIT A Form of Class A Certificate
EXHIBIT B Form of Class B Certificate
EXHIBIT C Form of CIA Certificate
EXHIBIT D DTC Letter of Representations
EXHIBIT E Form of Monthly Allocations and Payment Instructions
EXHIBIT F Form of Monthly Certificateholders' Statement
EXHIBIT G Form of Transferee Representation Letter
iii
<PAGE>
SERIES 1996-2 SUPPLEMENT, dated as of June 4, 1996 (this "Series
------
Supplement") by and between FIRST USA BANK, a Delaware chartered banking
----------
corporation, as Transferor and Servicer, and THE BANK OF NEW YORK
(DELAWARE) (as successor to The Bank of New York as successor to
NationsBank, N.A.), as Trustee under the Pooling and Servicing Agreement
dated as of September 1, 1992 between FIRST USA BANK, as Transferor and
Servicer, and the Trustee, as amended (the "Agreement").
---------
Section 6.09 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
issuance by the Trustee to the Transferor for the execution and redelivery
to the Trustee for authentication of one or more Series of Certificates.
The Transferor has tendered the Exchange Notice required by subsection
6.09(b) of the Agreement and hereby enters into this Series Supplement with
the Trustee as required by subsection 6.09(c) of the Agreement to provide
for the issuance, authentication and delivery of the Investor Certificates
of Series 1996-2 (the "Series 1996-2 Certificates").
--------------------------
Pursuant to this Series Supplement, the Transferor and the
Trustee shall create a new Series of Investor Certificates and shall
specify the Principal Terms thereof.
SECTION 1. Designation. There is hereby created a Series of
-----------
Investor Certificates to be issued pursuant to the Agreement and this
Series Supplement to be known generally as the "Series 1996-2
-------------
Certificates." The Series 1996-2 Certificates shall be issued in three
------------
Classes, which shall be designated generally as the Class A Floating Rate
Asset Backed Certificates, Series 1996-2 (the "Class A Certificates"), the
--------------------
Class B Floating Rate Asset Backed Certificates, Series 1996-2 (the "Class
-----
B Certificates") and the CIA Certificates, Series 1996-2 (the "CIA
-------------- ---
Certificates"). The CIA Certificates will be treated as a Class of
------------
Certificates for all purposes under the Agreement and this Series
Supplement; provided, however, that the provisions of subsection 6.09(b)
-------- -------
with respect to the delivery of an Opinion of Counsel to the effect that a
newly issued Series of Investor Certificates will be treated as debt for
Federal income tax purposes will not apply to the CIA Certificates.
1
<PAGE>
SECTION 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 Article, Section 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 Series 1996-2 Certificates and no other Series of
Certificates issued by the Trust.
"Accumulation Period" shall mean, unless a Pay Out Event shall
-------------------
have occurred prior thereto, the period commencing at the close of business
on May 31, 2002, or such later date as is determined in accordance with
subsection 4.09(i) of the Agreement and ending on the first to occur of (a)
the commencement of the Rapid Amortization Period and (b) the Series 1996-2
Termination Date.
"Accumulation Period Factor" shall mean, for any Monthly Period,
--------------------------
a fraction, the numerator of which is equal to the sum of the initial
invested amounts of all outstanding Series, and the denominator of which is
equal to the sum of (a) the Initial Invested Amount, (b) the initial
invested amounts of all outstanding Series (other than Series 1996-2) which
are not expected to be in their revolving periods during such Monthly
Period, and (c) the initial invested amounts of all other outstanding
Series which are not allocating Excess Principal Collections and are
expected to be in their revolving periods during such Monthly Period.
"Accumulation Period Length" shall have the meaning assigned such
--------------------------
term in subsection 4.09(i) of the Agreement.
"Accumulation Shortfall" shall initially mean zero and shall
----------------------
thereafter mean, with respect to any Monthly Period during the 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 4.09(e)(i) with respect to the Class
A Certificates for the previous Monthly Period.
2
<PAGE>
"Adjusted Invested Amount" shall mean, with respect to any date
------------------------
of determination, an amount equal to the sum of the Class A Adjusted
Invested Amount, the Class B Adjusted Invested Amount and the CIA Adjusted
Invested Amount.
"Agreement" shall mean the Pooling and Servicing Agreement dated
---------
as of September 1, 1992 between First USA Bank, as Transferor and Servicer,
and the Trustee, as amended.
"Amortization Period" shall mean, with respect to the Series
-------------------
1996-2 Certificates, the period commencing on the earlier of (a) the first
day of the Accumulation Period, or (b) the Pay Out Commencement Date, and
continuing to and including the earlier of (i) the payment in full to the
Class A Certificateholders of the Class A Invested Amount, to the Class B
Certificateholders of the Class B Invested Amount and to the CIA
Certificateholders of the CIA Invested Amount, and (ii) the Scheduled
Series 1996-2 Termination Date.
"Assignee" shall have the meaning specified in subsection 11(a)
--------
of this Series Supplement.
"Assignment" shall have the meaning specified in subsection 11(a)
----------
of this Series Supplement.
"Available Investor Principal Collections" shall mean, with
----------------------------------------
respect to any Monthly Period, an amount equal to (a) the sum of (i) an
amount equal, during the Revolving Period, to the Floating Allocation
Percentage or, during the Amortization Period, to the Fixed/Floating
Allocation Percentage of Collections of Principal Receivables with respect
to such Period, (ii) any Unallocated Principal Collections allocated to the
Investor Certificates on deposit in the Principal Account on the following
Distribution Date, (iii) the amount, if any, of Collections of Finance
Charge Receivables and Excess Finance Charge Collections to be distributed
pursuant to subsection 4.09(a)(iii) with respect to the following
Distribution Date, and (iv) the amount, if any, of Excess Finance Charge
Collections to be distributed pursuant to subsections 4.13(b), (d), (e),
(h) and (i) on the following Transfer Date, minus (b) the amount of
-----
Reallocated Principal Collections with respect to such Monthly Period which
are required to fund a deficiency pursuant to Section 4.14 for such
Distribution Date, if any.
3
<PAGE>
"Available Reserve Account Amount" shall mean, with respect to
--------------------------------
any Transfer Date, the lesser of (a) the amount on deposit in the Reserve
Account as of such date (before giving effect to any deposit or withdrawal
made or to be made pursuant to subsection 4.13(j) to the Reserve Account on
such date) and (b) the Required Reserve Account Amount.
"Average Principal Balance" shall mean, for a Monthly Period in
-------------------------
which Additional Accounts are designated for inclusion in or Removed
Accounts are designated for removal from the Trust, the weighted average of
the Principal Receivables in the Trust at the end of the day on the last
day of the prior Monthly Period and the Principal Receivables in the Trust
at the end of the day on the related Addition Date or Removal Date, as
applicable, weighted, respectively, by a fraction, the numerator of which
is the number of days from and including the first day of such Monthly
Period to but excluding the related Addition Date or Removal Date, as
applicable, and the denominator of which is the number of days in such
Monthly Period, and by a fraction, the numerator of which is the number of
days from and including the related Addition Date or Removal Date, as
applicable, to and including the last day of such Monthly Period, and the
denominator of which is the number of days in such Monthly Period.
"Base Rate" shall mean, with respect to any Monthly Period, the
---------
sum of the weighted average of the Class A Certificate Rate, the Class B
Certificate Rate and the CIA Certificate Rate as of the last day of such
Monthly Period (weighted based on the Class A Invested Amount, the Class B
Invested Amount and the CIA Invested Amount, respectively, as of the last
day of such Monthly Period) plus the product of 2.00% and the percentage
equivalent of a fraction the numerator of which is the Adjusted Invested
Amount and the denominator of which is the Invested Amount each as of the
last day of such Monthly Period.
"Business Day" shall mean, for the purpose of determining LIBOR,
------------
any day other than a Saturday, Sunday or day on which banking institutions
in New York, New York, in Newark, Delaware or in London, England, trading
in Dollar deposits in the London interbank market, are authorized or
obligated by law or executive order to be closed and for all other purposes
shall have the meaning provided in the Agreement.
4
<PAGE>
"Calculation Date" shall mean July 11, 1996 and the second
----------------
Business Day (as defined for purposes of determining LIBOR) prior to the
15th day of each calendar month thereafter, or if such 15th day is not a
Business Day, the next succeeding Business Day.
"CIA Adjusted Invested Amount" shall mean, with respect to any
----------------------------
date of determination, an amount not less than zero equal to the CIA
Invested Amount minus the excess, if any, of the Principal Funding Account
-----
Balance over the sum of the Class A Invested Amount and the Class B
Invested Amount on such date of determination.
"CIA Certificateholder" shall mean the Person in whose name a CIA
---------------------
Certificate is registered in the Certificate Register.
"CIA Certificateholders' Interest" shall mean the portion of the
--------------------------------
Series 1996-2 Certificateholders' Interest evidenced by the CIA
Certificates.
"CIA Certificate Rate" shall mean a per annum rate of 1.00% in
--------------------
excess of LIBOR, as determined on the related LIBOR Determination Date or
such lesser rate as may be designated in the Spread Account Agreement.
"CIA Certificates" shall mean any of the certificates executed by
----------------
the Transferor and authenticated by or on behalf of the Trustee,
substantially in the form of Exhibit C hereto.
"CIA Default Interest" shall have the meaning specified in
--------------------
subsection 4.06(c) of the Agreement.
"CIA Fixed/Floating Allocation Percentage" shall mean for any
----------------------------------------
Monthly Period during the Amortization Period the percentage equivalent of
a fraction, the numerator of which is the CIA Invested Amount at the end of
the last day of the Revolving Period and the denominator of which is the
greater of (a) the total amount of Principal Receivables in the Trust at
the end of the last day of the preceding Monthly Period and (b) the sum of
the numerators used to calculate fixed/floating allocation percentages
with respect to all Series then outstanding on the applicable
Distribution Date; provided, however, that with respect to any Monthly
-------- -------
Period in which an Addition Date or Removal Date occurs and
the Servicer need not make daily deposits of Collections into the
Collection Account, the denominator deter-
5
<PAGE>
mined pursuant to clause (a) shall be the Average Principal Balance;
provided further, however, that with respect to any Monthly Period in which
-------- ------- -------
an Addition Date or Removal Date occurs and the Servicer is required to
make daily deposits of Collections into the Collection Account, the
denominator determined pursuant to clause (a) hereof shall be (1) the
aggregate amount of Principal Receivables in the Trust at the end of the
day 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, as applicable, and (2) the aggregate amount
of Principal Receivables in the Trust at the end of the day on the related
Addition Date or Removal Date, as applicable, for the period from and
including such Addition Date or Removal Date, as applicable, to and
including the last day of such Monthly Period.
"CIA Floating Allocation Percentage" shall mean, with respect to
----------------------------------
any Monthly Period, the percentage equivalent of a fraction, the numerator
of which is the CIA Adjusted Invested Amount as of the last day of the
preceding Monthly Period and the denominator of which is the total amount
of Principal Receivables in the Trust as of the last day of such preceding
Monthly Period; provided however, that, with respect to the first Monthly
-------- -------
Period, the CIA Floating Allocation Percentage shall mean the percentage
equivalent of a fraction, the numerator of which is the CIA Initial
Invested Amount and the denominator of which is the total amount of
Principal Receivables on the Closing Date; provided further, that with
-------- -------
respect to any Monthly Period in which an Addition Date or Removal Date
occurs and the Servicer need not make daily deposits of Collections into
the Collection Account, the denominator in the definition of the CIA
Floating Allocation Percentage shall be the Average Principal Balance;
provided further, that with respect to any Monthly Period in which an
-------- -------
Addition Date or Removal Date occurs and the Servicer is required to make
daily deposits of Collections into the Collection Account, the denominator
in the definition of the CIA Floating Allocation Percentage shall be (1)
the aggregate amount of Principal Receivables in the Trust at the end of
the day 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, as applicable, and (2) the aggregate amount
of Principal Receivables in the Trust at the end of the day on the related
Addition Date or Removal Date, as
6
<PAGE>
applicable, for the period from and including such Addition Date or Removal
Date, as applicable, to and including the last day of such Monthly Period.
"CIA Initial Invested Amount" shall mean the aggregate initial
---------------------------
principal amount of the CIA Certificates, which is $68,700,000.
"CIA Interest Shortfall" shall have the meaning specified in
----------------------
subsection 4.06(c) of the Agreement.
"CIA Invested Amount" shall mean, when used with respect to any
-------------------
date of determination, an amount equal to (a) the CIA Initial Invested
Amount, minus (b) the aggregate amount of principal payments made to CIA
-----
Certificateholders prior to such day, minus (c) the aggregate amount of CIA
-----
Investor Charge-Offs for all prior Distribution Dates pursuant to
subsection 4.12(c) of the Agreement, minus (d) the amount of the
-----
Reallocated Principal Collections allocated on all prior Distribution Dates
pursuant to Section 4.14 of the Agreement (but in the aggregate not in
excess of the CIA Initial Invested Amount), minus (e) an amount equal to
-----
the amount by which the CIA Invested Amount has been reduced on all prior
Distribution Dates pursuant to subsections 4.12(a) and (b) of the Agreement
and plus (f) the amount of Excess Finance Charge Collections allocated and
----
available on all prior Transfer Dates pursuant to subsection 4.13(i) of the
Agreement, for the purpose of reimbursing amounts deducted pursuant to the
foregoing clauses (c), (d) and (e); provided, however, that the CIA
-------- -------
Invested Amount may not be reduced below zero.
"CIA Investor Charge-Offs" shall have the meaning specified in
------------------------
subsection 4.12(c) of the Agreement.
"CIA Investor Default Amount" shall mean, with respect to each
---------------------------
Distribution Date and each Receivable in an Account which became a
Defaulted Account during the related Monthly Period, an amount equal to the
product of the aggregate Default Amount for the related Monthly Period and
the CIA Investor Percentage applicable for the related Monthly Period.
"CIA Investor Percentage" shall mean for any Monthly Period, (a)
-----------------------
with respect to Defaulted Receivables and Finance Charge Receivables at any
time or Principal Receivables during the Revolving Period, the CIA Floating
Allocation Percentage, and (b) with respect to Principal
7
<PAGE>
Receivables during the Amortization Period, the CIA Fixed/Floating
Allocation Percentage.
"CIA Monthly Interest" shall mean the monthly interest
--------------------
distributable in respect of the CIA Invested Amount as calculated in
accordance with subsection 4.06(c) of the Agreement.
"CIA Monthly Principal" shall mean the monthly principal
---------------------
distributable in respect of the CIA Invested Amount as calculated in
accordance with subsection 4.07(c) of the Agreement.
"CIA Monthly Servicing Fee" shall mean, with respect to any
-------------------------
Distribution Date, one-twelfth of the product of the Series Servicing Fee
Percentage and the CIA Adjusted Invested Amount on the last day of the
preceding Monthly Period; provided, however, that with respect to the
-------- -------
initial Monthly Period the CIA Monthly Servicing Fee shall be $76,229.
"CIA Principal Commencement Date" shall mean (a) with respect to
-------------------------------
the Accumulation Period, the first Distribution Date on which an amount
equal to the sum of the Class A Invested Amount and the Class B Invested
Amount has been deposited in the Principal Funding Account and allocated to
the Class A Certificates and the Class B Certificates or (b) with respect
to the Rapid Amortization Period, the Distribution Date on which the Class
A Invested Amount and the Class B Invested Amount have each been paid in
full or, if there are no Principal Receivables allocable to the Investor
Certificates remaining after payments have been made to the Class A
Certificates and the Class B Certificates on such Distribution Date, the
Distribution Date following the Distribution Date on which the Class A
Invested Amount and the Class B Invested Amount have each been paid in
full.
"Class A Adjusted Invested Amount" shall mean, with respect to
--------------------------------
any date of determination, an amount not less than zero equal to the Class
A Invested Amount 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
Percentage of the Collections of Finance Charge Receivables deposited in
the Finance Charge Account in respect of such Monthly
8
<PAGE>
Period, (b) with respect to any Monthly Period during the Accumulation
Period prior to the payment in full of the Class A Invested Amount, the
Principal Funding Investment Proceeds pursuant to subsection 4.16(b) of the
Agreement, if any, with respect to the related Transfer Date and (c)
amounts, if any, to be withdrawn from the Reserve Account which will be
deposited into the Finance Charge Account on the related Transfer Date
pursuant to subsections 4.17(b) and 4.17(d) of the Agreement.
"Class A Certificate Rate" shall mean 5.6175% from and including
------------------------
June 4, 1996 through and including July 9, 1996, and with respect to each
Interest Period thereafter, a per annum rate of 0.18% 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 Certificateholders' Interest" shall mean the portion of
------------------------------------
the Series 1996-2 Certificateholders' Interest evidenced by the Class A
Certificates.
"Class A Certificates" shall mean any of the certificates
--------------------
executed by the Transferor and authenticated by or on behalf of the
Trustee, substantially in the form of Exhibit A hereto.
"Class A Default Interest" shall have the meaning specified in
------------------------
subsection 4.06(a) of the Agreement.
"Class A Floating Allocation Percentage" shall mean, with respect
--------------------------------------
to any Monthly Period, the percentage equivalent of a fraction, the
numerator of which is the Class A Adjusted Invested Amount as of the last
day of the preceding Monthly Period and the denominator of which is the
total amount of Principal Receivables in the Trust as of the last day of
such preceding Monthly Period; provided however, that, with respect to the
-------- -------
first Monthly Period, the Class A Floating Allocation Percentage shall mean
the percentage equivalent of a fraction, the numerator of which is the
Class A Initial Invested Amount and the denominator of which is the total
amount of Principal Receivables in the Trust on the Closing Date; provided
--------
further, that with respect to any Monthly Period in which an Addition Date
-------
or a Removal Date occurs and the Servicer need not make daily deposits of
Collections into the Collection Account, the denominator in the definition
9
<PAGE>
of the Class A Floating Allocation Percentage shall be the Average
Principal Balance; provided further, that with respect to any Monthly
-------- -------
Period in which an Addition Date or Removal Date occurs and the Servicer is
required to make daily deposits of Collections into the Collection Account,
the denominator in the definition of the Class A Floating Allocation
Percentage shall be (1) the aggregate amount of Principal Receivables in
the Trust at the end of the day 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, as applicable, and
(2) the aggregate amount of Principal Receivables in the Trust at the end
of the day on the related Addition Date or Removal Date, as applicable, for
the period from such Addition Date to and including the last day of such
Monthly Period.
"Class A Initial Invested Amount" shall mean the aggregate
-------------------------------
initial principal amount of the Class A Certificates, which is
$600,000,000.
"Class A Interest Shortfall" shall have the meaning specified in
--------------------------
subsection 4.06(a) of the Agreement.
"Class A Invested Amount" shall mean, when used with respect to
-----------------------
any date of determination, an amount equal to (a) the Class A Initial
Invested Amount, minus (b) the aggregate amount of principal payments made
-----
to Class A Certificateholders prior to such day and minus (c) the excess,
-----
if any, of the aggregate amount of Class A Investor Charge-Offs over Class
A Investor Charge-Offs reimbursed pursuant to subsection 4.12(a) of the
Agreement prior to such day.
"Class A Investor Charge-Offs" shall have the meaning specified
----------------------------
in subsection 4.12(a) of the Agreement.
"Class A Investor Default Amount" shall mean, with respect to
-------------------------------
each Distribution Date and each Receivable in an Account which became a
Defaulted Account during the related Monthly Period, an amount equal to the
product of the aggregate Default Amount for the related Monthly Period and
the applicable Class A Investor Percentage for the related Monthly Period.
"Class A Investor Percentage" shall mean for any Monthly Period,
---------------------------
(a) with respect to Defaulted Receivables and Finance Charge Receivables at
any time and Principal Receivables during the Revolving Period, the
10
<PAGE>
Class A Floating Allocation Percentage, and (b) with respect to Principal
Receivables during the Amortization Period, the Fixed/Floating Allocation
Percentage.
"Class A Monthly Interest" shall mean the monthly interest
------------------------
distributable in respect of the Class A Certificates as calculated in
accordance with subsection 4.06(a) of the Agreement.
"Class A Monthly Principal" shall mean the monthly principal
-------------------------
distributable in respect of the Class A Certificates as calculated in
accordance with subsection 4.07(a) of the Agreement.
"Class A Monthly Servicing Fee" shall mean, with respect to any
-----------------------------
Distribution Date, one-twelfth of the product of the Series Servicing Fee
Percentage and the Class A Adjusted Invested Amount on the last day of the
preceding Monthly Period; provided, however, that with respect to the
-------- -------
initial Monthly Period the Class A Monthly Servicing Fee shall be $665,753.
"Class A Outstanding Principal Balance" shall mean, when used
-------------------------------------
with respect to any date of determination, an amount equal to (a) the Class
A Initial Invested Amount, minus (b) the aggregate amount of principal
-----
payments made to the Class A Certificateholders prior to such day.
"Class A Pool Factor" shall mean, with respect to any Record
-------------------
Date, a number carried out to seven decimal places representing the ratio
of the Class A Invested Amount as of such Record Date (determined after
taking into account any increases or decreases in the Class A Invested
Amount which will occur on the following Distribution Date) to the Class A
Initial Invested Amount.
"Class A Required Amount" shall have the meaning specified in
-----------------------
Section 4.08 of the Agreement.
"Class A Scheduled Payment Date" shall mean the June 2003
------------------------------
Distribution Date.
"Class B Adjusted Invested Amount" shall mean, with respect to
--------------------------------
any date of determination, an amount not less than zero equal to the Class
B Invested Amount minus the excess, if any, of the Principal Funding
-----
Account Balance over the Class A Invested Amount on such date of
determination.
11
<PAGE>
"Class B Certificate Rate" shall mean 5.7675% from and including
------------------------
June 4, 1996 through and including July 9, 1996, and with respect to each
Interest Period thereafter, a per annum rate of 0.33% 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 Certificateholders' Interest" shall mean the portion of
------------------------------------
the Series 1996-2 Certificateholders' Interest evidenced by the Class B
Certificates.
"Class B Certificates" shall mean any of the certificates
--------------------
executed by the Transferor and authenticated by or on behalf of the
Trustee, substantially in the form of Exhibit B hereto.
"Class B Default Interest" shall have the meaning specified in
------------------------
subsection 4.06(b) of the Agreement.
"Class B Fixed/Floating Allocation Percentage" shall mean for any
--------------------------------------------
Monthly Period during the Amortization Period the percentage equivalent of
a fraction, the numerator of which is the Class B Invested Amount at the
end of the last day of the Revolving Period and the denominator of which is
the greater of (a) the total amount of Principal Receivables in the Trust
at the end of the last day of the preceding Monthly Period and (b) the sum
of the numerators used to calculate fixed/
floating allocation percentages with respect to all Series then outstanding
on the applicable Distribution Date; provided, however, that with respect
-------- -------
to any Monthly Period in which an Addition Date or Removal Date occurs and
the Servicer need not make daily deposits of Collections into the
Collection Account, the denominator determined pursuant to clause (a) shall
be the Average Principal Balance; provided further, however, that with
-------- ------- -------
respect to any Monthly Period in which an Addition Date or Removal Date
occurs and the Servicer is required to make daily deposits of Collections
into the Collection Account, the denominator determined pursuant to clause
(a) hereof shall be (1) the aggregate amount of Principal Receivables in
the Trust at the end of the day 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, as applicable, and
(2) the aggregate amount of Principal
12
<PAGE>
Receivables in the Trust at the end of the day on the related Addition Date
or Removal Date, as applicable, for the period from and including such
Addition Date or Removal Date, as applicable, to and including the last day
of such Monthly Period.
"Class B Floating Allocation Percentage" shall mean, with respect
--------------------------------------
to any Monthly Period, the percentage equivalent of a fraction, the
numerator of which is the Class B Adjusted Invested Amount as of the last
day of the preceding Monthly Period and the denominator of which is the
total amount of Principal Receivables in the Trust as of the last day of
such preceding Monthly Period; provided however, that, with respect to the
-------- -------
first Monthly Period, the Class B Floating Allocation Percentage shall mean
the percentage equivalent of a fraction, the numerator of which is the
Class B Initial Invested Amount and the denominator of which is the total
amount of Principal Receivables on the Closing Date; provided further, that
-------- -------
with respect to any Monthly Period in which an Addition Date or Removal
Date occurs and the Servicer need not make daily deposits of Collections
into the Collection Account, the denominator in the definition of the Class
B Floating Allocation Percentage shall be the Average Principal Balance;
provided further, that with respect to any Monthly Period in which an
-------- -------
Addition Date or Removal Date occurs and the Servicer is required to make
daily deposits of Collections into the Collection Account, the denominator
in the definition of the Class B Floating Allocation Percentage shall be
(1) the aggregate amount of Principal Receivables in the Trust at the end
of the day 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, as applicable, and (2) the aggregate
amount of Principal Receivables in the Trust at the end of the day on the
related Addition Date or Removal Date, as applicable, for the period from
and including such Addition Date or Removal Date, as applicable, to and
including the last day of such Monthly Period.
"Class B Initial Invested Amount" shall mean the aggregate
-------------------------------
initial principal amount of the Class B Certificates, which is $54,300,000.
"Class B Interest Shortfall" shall have the meaning specified in
--------------------------
subsection 4.06(b) of the Agreement.
13
<PAGE>
"Class B Invested Amount" shall mean, when used with respect to
-----------------------
any date of determination, an amount equal to (a) the Class B Initial
Invested Amount, minus (b) the aggregate amount of principal payments made
-----
to Class B Certificateholders prior to such day, minus (c) the aggregate
-----
amount of Class B Investor Charge-Offs for all prior Distribution Dates,
minus (d) the amount of the Reallocated Class B Principal Collections
-----
allocated on all prior Distribution Dates for which the CIA Invested Amount
has not been reduced pursuant to subsection 4.14(a) of the Agreement, minus
-----
(e) an amount equal to the amount by which the Class B Invested Amount has
been reduced on all prior Distribution Dates pursuant to subsection 4.12(a)
of the Agreement and plus (f) the amount of Excess Finance Charge
----
Collections allocated and available on all prior Transfer Dates pursuant to
subsection 4.13(e) of the Agreement, for the purpose of reimbursing amounts
deducted pursuant to the foregoing clauses (c), (d) and (e); provided,
--------
however, that the Class B Invested Amount may not be reduced below zero.
-------
"Class B Investor Charge-Offs" shall have the meaning specified
----------------------------
in subsection 4.12(b) of the Agreement.
"Class B Investor Default Amount" shall mean, with respect to
-------------------------------
each Distribution Date and each Receivable in an Account which became a
Defaulted Account during the related Monthly Period, an amount equal to the
product of the aggregate Default Amount for the related Monthly Period and
the Class B Investor Percentage applicable for the related Monthly Period.
"Class B Investor Percentage" shall mean for any Monthly Period,
---------------------------
(a) with respect to Defaulted Receivables and Finance Charge Receivables at
any time or Principal Receivables during the Revolving Period, the Class B
Floating Allocation Percentage, and (b) with respect to Principal
Receivables during the Amortization Period, the Class B Fixed/Floating
Allocation Percentage.
"Class B Monthly Interest" shall mean the monthly interest
------------------------
distributable in respect of the Class B Certificates as calculated in
accordance with subsection 4.06(b) of the Agreement.
"Class B Monthly Principal" shall mean the monthly principal
-------------------------
distributable in respect of the Class B Certificates as calculated in
accordance with subsection 4.07(b) of the Agreement.
14
<PAGE>
"Class B Monthly Servicing Fee" shall mean, with respect to any
-----------------------------
Distribution Date, one-twelfth of the product of the Series Servicing Fee
Percentage and the Class B Adjusted Invested Amount on the last day of the
preceding Monthly Period; provided, however, that with respect to the
-------- -------
initial Monthly Period the Class B Monthly Servicing Fee shall be $60,251.
"Class B Outstanding Principal Balance" shall mean, when used
-------------------------------------
with respect to any date of determination, an amount equal to (a) the Class
B Initial Invested Amount, minus (b) the aggregate amount of principal
-----
payments made to the Class B Certificateholders prior to such day.
"Class B Pool Factor" shall mean, with respect to any Record
-------------------
Date, a number carried out to seven decimal places representing the ratio
of the Class B Invested Amount as of such Record Date (determined after
taking into account any increases or decreases in the Class B Invested
Amount which will occur on the following Distribution Date) to the Class B
Initial Invested Amount.
"Class B Principal Commencement Date" shall mean (a) with respect
-----------------------------------
to the Accumulation Period, the first Distribution Date on which an amount
equal to the Class A Invested Amount has been deposited in the Principal
Funding Account and allocated to the Class A Certificates or (b) with
respect to the Rapid Amortization Period, the Distribution Date on which
the Class A Invested Amount is paid in full or, if there are no Principal
Receivables allocable to the Investor Certificates remaining after payments
have been made to the Class A Certificates on such Distribution Date, the
Distribution Date following the Distribution Date on which the Class A
Invested Amount is paid in full.
"Class B Required Amount" shall have the meaning specified in
-----------------------
Section 4.08 of the Agreement.
"Class B Scheduled Payment Date" shall mean the June 2003
------------------------------
Distribution Date.
"Closing Date" shall mean June 4, 1996.
------------
"Controlled Accumulation Amount" shall mean, for any Transfer
------------------------------
Date with respect to the Accumulation Period prior to the payment in full
of the Invested Amount, $60,250,000; provided, however, that if the Accu-
-------- -------
15
<PAGE>
mulation Period Length is determined to be less than 12 months pursuant to
subsection 4.09(i) of the Agreement, the Controlled Accumulation Amount for
each Transfer Date with respect to the Accumulation Period prior to the
payment in full of the Class A Invested Amount will be equal to (i) the
product of (x) the Initial Invested Amount and (y) the Accumulation Period
Factor for such Monthly Period divided by (ii) the Required Accumulation
Factor Number.
"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, with respect to any Interest Period
--------------
during the Accumulation Period prior to the payment in full of the Invested
Amount, the product of (a) a fraction, the numerator of which is the actual
number of days in such Interest Period and the denominator of which is 360,
(b) the weighted average of the Class A Certificate Rate, the Class B
Certificate Rate and the CIA Certificate Rate in effect with respect to the
related Interest Period, and (c) the Principal Funding Account Balance up
to the Invested Amount as of the last day of the Monthly Period preceding
the Monthly Period in which such Interest Period ends.
"Daily Deposit Date" shall mean the Determination Date on which
------------------
the Excess Spread Percentage (as defined in the Spread Account Agreement)
for the Monthly Period preceding such date is less than 2.50% per annum.
"Default Interest" shall mean, with respect to any Distribution
----------------
Date, the sum of Class A Default Interest, Class B Default Interest and CIA
Default Interest distributable in respect of the Investor Certificates as
calculated in accordance with Section 4.06 of the Agreement.
"Determination Date" shall mean the third Business Day prior to
------------------
each Distribution Date.
"Distribution Date" shall mean July 10, 1996, and the 10th day of
-----------------
each calendar month thereafter, or if such 10th day is not a Business Day,
the next succeeding Business Day.
16
<PAGE>
"Enhancement" shall mean with respect to the Class A
-----------
Certificates, the subordination of the Class B Certificates and the CIA
Certificates, and with respect to the Class B Certificates, the
subordination of the CIA Certificates.
"Enhancement Provider" shall mean the CIA Certificateholders.
--------------------
"Excess Finance Charge Collections" shall mean, with respect to
---------------------------------
any Transfer Date, the sum of the amounts, if any, specified pursuant to
subsections 4.09(a)(iv), 4.09(b)(iii), 4.09(c)(ii), 4.17(e) and 4.17(f) of
the Agreement with respect to such Transfer Date.
"Excess Principal Collections" shall mean, as the context
----------------------------
requires, either (a) the amount allocated to the Investor Certificates
which, in accordance with subsections 4.05(b)(ii), 4.05(c)(ii) and 4.05(f)
of the Agreement, may be applied to Principal Shortfalls 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 "Excess Principal Collections" and
which may be applied to cover Principal Shortfalls with respect to the
Investor Certificates.
"Finance Charge Deficit" shall have the meaning set forth in
----------------------
subsection 4.05(b)(ii) of the Agreement.
"Fixed/Floating Allocation Percentage" shall mean for any Monthly
------------------------------------
Period during the Amortization Period the percentage equivalent of a
fraction, the numerator of which is the Invested Amount at the end of the
last day of the Revolving Period and the denominator of which is the
greater of (a) the total amount of Principal Receivables in the Trust at
the end of the last day of the preceding Monthly Period and (b) the sum of
the numerators used to calculate fixed/floating allocation percentages with
respect to all Series then outstanding on the applicable Distribution Date;
provided, however, that with respect to any Monthly Period in which an
-------- -------
Addition Date or a Removal Date occurs and the Servicer need not make daily
deposits of Collections into the Collection Account, the denominator
determined pursuant to clause (a) shall be the Average Principal Balance;
provided further, however, that with respect to any Monthly Period in which
-------- ------- -------
an Addition Date or Removal Date
17
<PAGE>
occurs and the Servicer is required to make daily deposits of Collections
into the Collection Account, the denominator determined pursuant to clause
(a) hereof shall be (1) the aggregate amount of Principal Receivables in
the Trust at the end of the day 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, as applicable, and
(2) the aggregate amount of Principal Receivables in the Trust at the end
of the day on the related Addition Date or Removal Date, as applicable, for
the period from and including the related Addition Date or Removal Date, as
applicable, to and including the last day of such Monthly Period.
"Floating Allocation Percentage" shall mean for any date of
------------------------------
determination the sum of the applicable Class A Floating Allocation
Percentage, the applicable Class B Floating Allocation Percentage and the
CIA Floating Allocation Percentage.
"Initial Invested Amount" shall mean the aggregate initial
-----------------------
principal amount of the Investor Certificates of Series 1996-2, which is
$723,000,000.
"Interest Period" shall mean, with respect to a Distribution
---------------
Date, the period beginning on the preceding Distribution Date continuing
through the day preceding such Distribution Date, except the first Interest
Period shall be deemed to be the 36 day period from and including the
Closing Date through and including the day preceding the initial
Distribution Date.
"Interest Shortfall" shall mean, with respect to any Distribution
------------------
Date, the sum of the Class A Interest Shortfall, the Class B Interest
Shortfall and the CIA Interest Shortfall distributable in respect of the
Investor Certificates as calculated in accordance with Section 4.06 of the
Agreement.
"Invested Amount" shall mean, when used with respect to any date,
---------------
an amount equal to the sum of (a) the Class A Invested Amount, (b) the
Class B Invested Amount and (c) the CIA Invested Amount each as of such
date; provided, however, that for purposes of determining the Investor
-------- -------
Monthly Servicing Fee and the Aggregate Invested Amount, the Invested
Amount shall mean an amount equal to the sum of (a) the Class A Adjusted
Invested Amount, (b) the Class B Adjusted Invested Amount and (c)
18
<PAGE>
the CIA Adjusted Invested Amount with respect to any date of determination.
"Investor Certificateholder" shall mean the Holder of record of
--------------------------
an Investor Certificate of Series 1996-2.
"Investor Certificates" shall mean the Class A Certificates, the
---------------------
Class B Certificates and the CIA Certificates.
"Investor Default Amount" shall mean, with respect to each
-----------------------
Distribution Date, an amount equal to the sum of (a) the Class A Investor
Default Amount for such Distribution Date, (b) the Class B Investor Default
Amount for such Distribution Date and (c) the CIA Investor Default Amount
for such Distribution Date.
"Investor Monthly Servicing Fee" shall with respect to any
------------------------------
Transfer Date be equal to one-twelfth of the product of (A) the Series
Servicing Fee Percentage and (B) the Adjusted Invested Amount as of the
last day of the Monthly Period preceding such Transfer Date; provided,
--------
however, that with respect to the initial Monthly Period the Investor
-------
Monthly Servicing Fee shall be $802,233.
"Investor Percentage" shall mean for any Monthly Period, (a) with
-------------------
respect to Finance Charge Receivables and Defaulted Receivables at any time
and Principal Receivables during the Revolving Period, the Floating
Allocation Percentage and (b) with respect to Principal Receivables during
the Amortization Period, the Fixed/Floating Allocation Percentage.
"Issuance Date" shall mean the Closing Date.
-------------
"LIBOR" shall mean, for any Interest Period, the London interbank
-----
offered rate for one-month Dollar deposits determined by the Trustee for
each Interest Period in accordance with the provisions of Section 4.15 of
the Agreement.
"LIBOR Determination Date" shall mean May 31, 1996 for the period
------------------------
from and including June 4, 1996 through and including July 9, 1996 and the
second Business Day prior to the commencement of the second and each
subsequent Interest Period.
19
<PAGE>
"Minimum Transferor Interest" shall mean, with respect to any
---------------------------
period, 7% of the average of the aggregate amount of Principal Receivables
for such period.
"Monthly Interest" shall mean, with respect to any Distribution
----------------
Date, the sum of the Class A Monthly Interest, the Class B Monthly Interest
and the CIA Monthly Interest distributable in respect of the Series 1996-2
Certificates as calculated in accordance with Section 4.06 of the
Agreement.
"Monthly Period" shall have the meaning specified in the
--------------
Agreement, except that the first Monthly Period with respect to the Series
1996-2 Certificates shall begin on and include the Closing Date and shall
end on and include June 30, 1996.
"Monthly Principal" shall mean the monthly principal
-----------------
distributable in respect of the Series 1996-2 Certificates as calculated in
accordance with Section 4.07 of the Agreement.
"Pay Out Commencement Date" shall mean the earliest to occur of
-------------------------
(i) the date on which a Trust Pay Out Event is deemed to occur pursuant to
Section 9.01 of the Agreement, (ii) a Series 1996-2 Pay Out Event is deemed
to occur pursuant to Section 8 of this Series Supplement, (iii) the Class A
Scheduled Payment Date if the Class A Invested Amount is not paid in full
on such date and (iv) the Class B Scheduled Payment Date if the Class B
Invested Amount is not paid in full on such date.
"Paying Agent" shall mean The Bank of New York.
------------
"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 for such
Monthly Period from the Portfolio Yield for such Monthly Period.
"Portfolio Yield" shall mean for the Series 1996-2 Certificates,
---------------
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 allocated to the
Investor Certificates for such Monthly Period, and (b) the Principal
Funding Investment Proceeds deposited into the Finance Charge Account on
the Transfer Date related to such Monthly Period, and (c) the amount,
20
<PAGE>
if any, withdrawn from the Reserve Account to be deposited into the Finance
Charge Account pursuant to subsections 4.17(b) and 4.17(d) of the Agreement
on the Transfer Date relating to such Monthly Period (such sum to be
calculated on a cash basis after subtracting an amount equal to the
Investor Default Amount for such Monthly Period), and the denominator of
which is the Invested Amount as of the last day of the preceding Monthly
Period.
"Principal Funding Account" shall have the meaning set forth in
-------------------------
subsection 4.16(a) of the Agreement.
"Principal Funding Account Balance" shall mean, with respect to
---------------------------------
any date of determination during the Accumulation Period, 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 Interest Period during the Accumulation Period, the investment
earnings on funds in the Principal Funding Account (net of investment
expenses and losses) for such Interest Period.
"Principal Funding Investment Shortfall" shall mean, with respect
--------------------------------------
to each Interest Period during the Accumulation Period, the amount, if any,
by which the Principal Funding Investment Proceeds are less than the
Covered Amount.
"Principal Shortfalls" shall mean with respect to any
--------------------
Distribution Date (a) during the Accumulation Period, the amount, if any,
by which the Controlled Deposit Amount exceeds the sum of the Class A
Monthly Principal, Class B Monthly Principal and CIA Monthly Principal for
such Distribution Date or (b) during the Rapid Amortization Period, (i) the
amount, if any, by which the Class A Invested Amount exceeds the Class A
Monthly Principal for such Distribution Date, (ii) on and after the Class B
Principal Commencement Date, the amount, if any, by which the Class B
Invested Amount exceeds the Class B Monthly Principal for such Distribution
Date and (iii) on and after the CIA Principal Commencement Date, the amount
if any, by which the CIA Invested Amount exceeds the CIA Monthly Principal
for such Distribution Date.
21
<PAGE>
"QIB" shall mean a "qualified institutional buyer" within the
---
meaning of Rule 144A under the Securities Act.
"Rapid Amortization Period" shall mean the period commencing on
-------------------------
the Pay Out Commencement Date and ending on the earlier to occur of (i) the
date of termination of the Trust pursuant to Section 12.01 of the Agreement
or (ii) the Series 1996-2 Termination Date.
"Rating Agency" shall mean each of Fitch Investors Service, L.P.,
-------------
Moody's and Standard & Poor's.
"Rating Agency Condition" shall mean the notification in writing
-----------------------
by each Rating Agency to the Transferor, the Servicer and the Trustee that
any action will not result in any Rating Agency reducing or withdrawing its
then existing rating of the investor certificates of any outstanding Series
or class with respect to which it is a Rating Agency.
"Reallocated Class B Principal Collections" shall have the
-----------------------------------------
meaning specified in subsection 4.14(b) of the Agreement.
"Reallocated CIA Principal Collections" shall have the meaning
-------------------------------------
specified in subsection 4.14(a) of the Agreement.
"Reallocated Principal Collections" shall mean the sum of
---------------------------------
Reallocated Class B Principal Collections and Reallocated CIA 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 CIA Invested Amount" shall mean with respect to any
----------------------------
Distribution Date (i) $68,700,000 initially and (ii) thereafter an amount
equal to the greater of (a) $21,690,000 and (b) 9.5% of the Invested
Amount, in each case as of such Distribution Date after taking into account
distributions made on such date; provided
--------
22
<PAGE>
that (i) if any reductions in the CIA Invested Amount pursuant to clauses
(c), (d), or (e) of the definition of such amount, or a Pay Out Event has
occurred, the Required CIA Invested Amount for any Distribution Date shall
equal the amount of such requirement immediately preceding such reduction
or Pay Out Event, (ii) in no event shall the Required CIA Invested Amount
exceed the sum of the Class A Outstanding Principal Balance and the Class B
Outstanding Principal Balance as of the last day of the Monthly Period
preceding such Distribution Date and (iii) the Required CIA Invested Amount
may be reduced at any time to a lesser amount if the Rating Agency
Condition is satisfied.
"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 Invested Amount 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 CIA
Certificateholders 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 1996-2.
"Reserve Account" shall have the meaning specified in subsection
---------------
4.17(a) of the Agreement.
"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 3 months prior to the commencement of
the 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 which commences 12 months prior to the commencement of the
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
which commences 6 months prior to the commencement of the Accumulation
Period; or (d) the first Transfer Date for which the Portfolio Adjusted
Yield is less than 3.5%, but
23
<PAGE>
in such event the Reserve Account Funding Date shall not be required to
occur earlier than the Transfer Date which commences 4 months prior to the
commencement of the Accumulation Period.
"Reserve Account Surplus" shall mean, as of any Transfer Date
-----------------------
following the Reserve Account Funding Date, the amount, if any, by which
the amount on deposit in the Reserve Account exceeds the Required Reserve
Account Amount.
"Reserve Draw Amount" shall have the meaning specified in
-------------------
subsection 4.17(c) of the Agreement.
"Reversion Date" shall mean the first Determination Date
--------------
following any Daily Deposit Date on which (a) Excess Spread Percentage (as
defined in the Spread Account Agreement) for the Monthly Period preceding
such Determination Date is equal to or exceeds 2.50% per annum and (b) the
amount on deposit in the Spread Account (as defined in the Spread Account
Agreement) equals or exceeds the Spread Account Cap (as defined in the
Spread Account Agreement) for such Determination Date.
"Revolving Period" shall mean the period from and including the
----------------
Closing Date to, but not including, the earlier of (a) the day the
Accumulation Period commences and (b) the Pay Out Commencement Date.
"Scheduled Series 1996-2 Termination Date" shall mean the
----------------------------------------
February 2006 Distribution Date.
"Series 1996-2" shall mean the Series of the First USA Credit
-------------
Card Master Trust represented by the Investor Certificates.
"Series 1996-2 Certificateholder" shall mean the holder of record
-------------------------------
of any Series 1996-2 Certificate.
"Series 1996-2 Certificateholders' Interest" shall have the
------------------------------------------
meaning specified in Section 4.04 of the Agreement.
"Series 1996-2 Pay Out Event" shall have the meaning specified in
---------------------------
Section 8 of this Series Supplement.
24
<PAGE>
"Series 1996-2 Termination Date" shall mean the earlier to occur
------------------------------
of (i) the day after the Distribution Date on which the Investor
Certificates are paid in full, or (ii) the Scheduled Series 1996-2
Termination Date.
"Series Servicing Fee Percentage" shall mean 1.50% for so long as
-------------------------------
First USA Bank is the Servicer or 2.00% if First USA Bank is no longer the
Servicer.
"Spread Account Agreement" shall mean the agreement among the
------------------------
Transferor, the Servicer and the Trustee, dated June 4, 1996, as amended or
modified from time to time.
"Subordinate Principal Collections" shall have the meaning set
---------------------------------
forth in subsection 4.05(b)(ii) of the Agreement.
"Targeted Holder" shall mean each holder of a right to receive
---------------
interest or principal with respect to the CIA Certificates (or other
interests in the Trust), other than certificates (or other such interests)
with respect to which an opinion is rendered that such certificates (or
other such interests) will be treated as debt for federal income tax
purposes, and any holder of a right to receive any amount in respect of the
Transferor Interest; provided, that any Person holding more than one
--------
interest each of which would cause such Person to be a Targeted Holder
shall be treated as a single Targeted Holder.
"Transfer" shall have the meaning specified in subsection 11(a)
--------
of this Series Supplement.
"Unpaid Investor Monthly Servicing Fee" shall mean with respect
-------------------------------------
to any Transfer Date, the amount of the Investor Monthly Servicing Fee with
respect to such Transfer Date not distributed to the Servicer pursuant to
subsection 4.09(a)(ii), subsection 4.09(b)(ii), subsection 4.09(c)(i),
subsection 4.13(a) of the Agreement and any overdue Investor Monthly
Servicing Fee from prior Transfer Dates.
SECTION 3. Reassignment and Transfer Terms. The Series 1996-2
-------------------------------
Certificates shall be subject to retransfer to the Transferor at its
option, in accordance with the terms specified in subsection 12.02(a) of
the Agreement, on any Distribution Date on or after the Distribution Date
on which the Invested Amount is reduced to
25
<PAGE>
an amount less than or equal to 5% of the Initial Invested Amount. The
deposit required in connection with any such repurchase shall be equal to
the Invested Amount plus accrued and unpaid interest on the Series 1996-2
Certificates through the Record Date preceding the Distribution Date on
which the repurchase occurs.
SECTION 4. Delivery and Payment for the Series 1996-2
------------------------------------------
Certificates. The Transferor shall execute and deliver the Series 1996-2
------------
Certificates to the Trustee for authentication in accordance with Section
6.01 of the Agreement. The Trustee shall deliver the Series 1996-2
Certificates when authenticated in accordance with Section 6.02 of the
Agreement.
SECTION 5. Depositary; Form of Delivery of Series 1996-2
---------------------------------------------
Certificates. (a) The Class A Certificates and the Class B Certificates
------------
shall be delivered as Book-Entry Certificates as provided in Sections 6.01
and 6.10 of the Agreement. The CIA Certificates shall be delivered as
Registered Certificates as provided in Section 6.01 of the Agreement.
(b) The Depositary for Series 1996-2 shall be The Depository
Trust Company, and the Class A Certificates and the Class B Certificates
shall be initially registered in the name of Cede & Co., its nominee. The
Class A Certificates and the Class B Certificates will initially be held by
the Trustee as custodian for The Depository Trust Company.
SECTION 6. Article IV of Agreement. (A) Sections 4.01, 4.02 and
-----------------------
4.03 of the Agreement shall be read in their entirety as provided in the
Agreement except for subsections 4.02(b) and (c) of the Agreement which
shall, for purposes of this Series Supplement, read in their entirety as
follows:
"(b) The Finance Charge and Principal Accounts. The Trustee, for the
-----------------------------------------
benefit of the Series 1996-2 Certificateholders, shall establish and
maintain in the name of the Trust with a Qualified Institution (other
than the Transferor), which shall initially be the Paying Agent, two
segregated trust accounts (the "Finance Charge Account" and the
----------------------
"Principal Account," respectively), bearing a designation clearly
-----------------
indicating that the funds therein are held for the benefit of the
Series 1996-2 Certificatehold-
26
<PAGE>
ers. The Trustee shall possess all right, title and interest in all
funds on deposit from time to time in the Finance Charge Account and
the Principal Account and in all proceeds thereof. The Finance Charge
Account and the Principal Account shall be under the sole dominion and
control of the Trustee for the benefit of the Series 1996-2
Certificateholders. Pursuant to authority granted to it hereunder,
the Servicer shall have the revocable power to instruct the Trustee to
withdraw funds from the Finance Charge Account and Principal Account
for the purpose of carrying out the Servicer's or the Trustee's duties
hereunder. The Trustee at all times shall maintain copies of all
written reports and instructions that it receives reflecting each
transaction in the Principal Account and the Finance Charge Account
and that funds held therein shall at all times be held in trust for
the benefit of the Series 1996-2 Certificateholders.
(c) The Distribution Account. The Trustee, for the benefit of the
------------------------
Series 1996-2 Certificateholders, shall cause to be established and
maintained in the name of the Trust, with an office or branch of a
Qualified Institution (other than the Transferor), which shall
initially be the Paying Agent, a non-interest bearing segregated
account (the "Distribution Account") bearing a designation clearly
--------------------
indicating that the funds deposited therein are held in trust for the
benefit of the Series 1996-2 Certificateholders. The Trustee shall
possess all right, title and interest in all funds on deposit from
time to time in the Distribution Account and in all proceeds thereof.
The Distribution Account shall be under the sole dominion and control
of the Trustee for the benefit of the Series 1996-2
Certificateholders."
(B) Article IV of the Agreement (except for Sections 4.01, 4.02 and 4.03
thereof) shall read in its entirety as follows and shall be applicable only
to the Series 1996-2 Certificates:
27
<PAGE>
ARTICLE IV
RIGHTS OF CERTIFICATEHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS
Section 4.04 Rights of Certificateholders. 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 Allocation Percentage
and Fixed/Floating Allocation Percentage (as applicable from time to time)
of Collections received with respect to the Receivables and (b) funds on
deposit in the Collection Account, the Finance Charge Account, the
Principal Account, the Principal Funding Account, the Reserve Account and
the Distribution Account (for such Series, the "Series 1996-2
-------------
Certificateholders' Interest"). The CIA Certificates 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
Exchangeable Transferor Certificate shall not represent any interest in the
Collection Account, the Finance Charge Account, the Principal Account, the
Principal Funding Account, the Reserve Account or the Distribution Account,
except as specifically provided in this Article IV.
Section 4.05 Collections and Allocation.
--------------------------
(a) Collections. The Servicer will apply or will instruct the
-----------
Trustee to apply all funds on deposit in the Collection Account, the
Finance Charge Account, the Principal Account, the Principal Funding
Account, the Reserve Account or the Distribution Account allocable to the
Series 1996-2 Certificates as described in this Article IV.
(b) Daily Allocations During the Revolving Period. During the
---------------------------------------------
Revolving Period, the Servicer shall, prior to the close of business on
each Date of Processing, allocate the following amounts as set forth below:
(i) Allocate to the Series 1996-2 Certificateholders the
Floating Allocation Percentage of Collections of Finance Charge
Receivables and deposit and retain in the Finance Charge Account (A)
prior to the Calculation Date in each Monthly Period
28
<PAGE>
an amount equal to the product of (x) the Floating Allocation
Percentage and (y) the aggregate amount of Collections of Finance
Charge Receivables on such Date of Processing, or (B) on and after
each such Calculation Date to and including the last day of such
Monthly Period, the lesser of (x) the product of (1) the Floating
Allocation Percentage and (2) the aggregate amount of Collections of
Finance Charge Receivables on such Date of Processing and (y) the
excess of (1) the sum of the Monthly Interest, the Interest Shortfall
and the Default Interest for the Distribution Date following the then
current Monthly Period (plus, if the Transferor is not the Servicer,
the Investor Monthly Servicing Fee) over (2) the amounts previously
deposited in the Finance Charge Account with respect to the current
Monthly Period pursuant to this subsection 4.05(b)(i) of the
Agreement. On each Date of Processing on and after each Calculation
Date, Collections of Finance Charge Receivables allocated to the
Series 1996-2 Certificates in excess of the amount required to be
deposited and retained in the Finance Charge Account as provided above
shall be held by the Servicer and applied in accordance with
subsection 4.05(f) of the Agreement. Notwithstanding the foregoing,
on each Date of Processing from and including each Daily Deposit Date
to but excluding the immediately succeeding Reversion Date, the
Servicer shall be required to allocate to the Series 1996-2
Certificateholders the Floating Allocation Percentage of Collections
of Finance Charge Receivables and deposit and retain in the Finance
Charge Account an amount equal to the product of (i) the Floating
Allocation Percentage and (ii) the aggregate amount of Collections of
Finance Charge Receivables on such Date of Processing.
(ii) Allocate to the Series 1996-2 Certificateholders an
amount equal to the product of (A) the Floating Allocation Percentage
on such Date of Processing and (B) the aggregate amount of Collections
of Principal Receivables on such Date of Processing and pay such
amount to the Transferor subject to the obligation of the Transferor
to make an amount equal to the Reallocated Principal Collections and
Excess Principal Collections for such Monthly Period available on the
related Transfer Date in accordance with subsection 4.05(f) of the
Agreement; provided, however, that the amount to be
-------- -------
29
<PAGE>
paid to the Transferor pursuant to this subsection 4.05(b)(ii) of the
Agreement on any Date of Processing shall be paid only if the
Transferor Interest on such Date of Processing is greater than zero
(after giving effect to all Principal Receivables transferred to the
Trust on such Date of Processing and after giving effect to
Collections of Principal Receivables on such Date of Processing) and
otherwise shall be deposited in the Collection Account and applied in
accordance with subsection 4.03(f) of the Agreement; provided,
--------
further, however, that on and after the Calculation Date if the
------- -------
amounts previously deposited in the Finance Charge Account with
respect to the current Monthly Period pursuant to subsection
4.05(b)(i) of the Agreement are less than the sum of the Monthly
Interest, the Interest Shortfall and the Default Interest for the
Distribution Date following the then current Monthly Period (plus, if
the Transferor is not the Servicer, the Investor Monthly Servicing
Fee) (the amount of such shortfall, the "Finance Charge Deficit"), an
----------------------
amount not to exceed the product of (x) the sum of the Class B
Floating Allocation Percentage and the CIA Floating Allocation
Percentage and (y) the Collections of Principal Receivables on any
such Date of Processing ("Subordinate Principal Collections") with
---------------------------------
respect to the then current Monthly Period will be deposited into the
Principal Account on a daily basis during such Monthly Period in an
aggregate amount not to exceed the Finance Charge Deficit; at such
time as the Finance Charge Deficit is equal to zero, such amounts may
be released from the Principal Account and paid to the holder of the
Exchangeable Transferor Certificate, subject to the preceding proviso.
(c) Daily Allocations During the Accumulation Period. During
------------------------------------------------
the Accumulation Period, the Servicer shall, prior to the close of business
on each Date of Processing, allocate the following amounts as set forth
below:
(i) Allocate to the Series 1996-2 Certificateholders and
deposit and retain in the Finance Charge Account an amount equal to
the product of (A) the Floating Allocation Percentage on such Date of
Processing and (B) the aggregate amount of Collections of Finance
Charge Receivables on such Date of Processing.
30
<PAGE>
(ii) Allocate to the Series 1996-2 Certificateholders and retain
in the Principal Account an amount equal to the product of (x) the
Fixed/Floating Allocation Percentage on such Date of Processing and
(y) the aggregate amount of Collections of Principal Receivables on
such Date of Processing (for any such date, a "Percentage
----------
Allocation"); provided, however, that if the sum of such Percentage
---------- -------- -------
Allocations with respect to the same Monthly Period exceeds the
Controlled Deposit Amount for the related Distribution Date, then such
excess shall be paid to the Holder of the Exchangeable Transferor
Certificate (subject to the obligation of the Transferor to make an
amount equal to the Reallocated Principal Collections and Excess
Principal Collections for such Monthly Period available on the related
Transfer Date in accordance with subsection 4.05(f)) of the Agreement
if the Transferor Interest on such Date of Processing is greater than
zero (after giving effect to all Principal Receivables transferred to
the Trust on such day) and otherwise shall be deposited in the
Collection Account and applied in accordance with subsection 4.03(f)
of the Agreement; provided, further, that on and after the Calculation
-------- -------
Date if there is a Finance Charge Deficit, Subordinate Principal
Collections with respect to each Monthly Period will be deposited into
the Principal Account on a daily basis during such Monthly Period in
an aggregate amount not to exceed the Finance Charge Deficit; at such
time as the Finance Charge Deficit is equal to zero, such amounts may
be released from the Principal Account to the holder of the
Exchangeable Transferor Certificate, subject to the preceding proviso.
(d) Daily Allocations During the Rapid Amortization Period.
------------------------------------------------------
During the Rapid Amortization Period, the Servicer shall, prior to the
close of business on each Date of Processing, allocate the following
amounts as set forth below:
(i) Allocate to the Series 1996-2 Certificateholders and deposit
and retain in the Finance Charge Account an amount equal to the
product of (A) the Floating Allocation Percentage on such Date of
Processing and (B) the aggregate amount of Collections of Finance
Charge Receivables on such Date of Processing.
31
<PAGE>
(ii) Allocate to the Series 1996-2 Certificateholders and
deposit and retain in the Principal Account an amount equal to the
product of (A) the Fixed/Floating Allocation Percentage on such Date
of Processing and (B) the aggregate amount of Collections of Principal
Receivables on such Date of Processing; provided, however, that after
-------- -------
the date on which an amount of such Collections equal to the Invested
Amount has been deposited into the Collection Account and allocated to
the Series 1996-2 Certificateholders, the amount determined in
accordance with this subparagraph (ii) shall be paid to the Holder of
the Exchangeable Transferor Certificate only if the Transferor
Interest on such Date of Processing is greater than zero (after giving
effect to all Principal Receivables transferred to the Trust on such
day) and otherwise shall be deposited in the Collection Account and
applied in accordance with subsection 4.03(f) of the Agreement.
(e) Daily Deposits. Notwithstanding the foregoing, the
--------------
Servicer need not make daily deposits of Collections into the Collection
Account at any time when the requirements of the third paragraph of
subsection 4.03(a) of the Agreement are satisfied.
(f) Monthly Allocations During the Revolving Period and
---------------------------------------------------
Accumulation Period. To the extent not previously allocated pursuant to
-------------------
subsection 4.05(b), during the Revolving Period, the Servicer shall, on
each Transfer Date, allocate to the Series 1996-2 Certificateholders and
deposit in the Finance Charge Account an amount equal to (i) the lesser of
(A) the product of (x) the Floating Allocation Percentage with respect to
the preceding Monthly Period and (y) the aggregate amount of Collections of
Finance Charge Receivables for the related Monthly Period, and (B) the
aggregate of the amounts to be applied from amounts on deposit in the
Finance Charge Account on such Transfer Date pursuant to subsections
4.09(a)(i), (ii) and (iii), 4.09(b)(i) of the Agreement and (ii),
4.09(c)(i) and 4.13(a) through (j) of the Agreement and, to the extent
necessary any amounts to be applied in accordance with the Spread Account
Agreement (other than payments to First USA Bank or the Transferor), minus
(ii) the amounts deposited and retained in the Finance Charge Account daily
during such Monthly Period pursuant to subsection 4.05(b)(i) of the
Agreement. Any such amounts, to the extent they would be paid to First USA
Bank, as Transferor or Servicer, need not be so
32
<PAGE>
deposited but shall be deemed to have been so deposited and, as and when
specified in the subsections identified above, be deemed to have been paid
to First USA Bank pursuant to such subsections. During the Revolving
Period and the Accumulation Period, the Transferor shall, on each Transfer
Date deposit in the Principal Account an amount equal to the sum of (I) the
excess of the amount of Reallocated Principal Collections over the amount
deposited and retained in the Principal Account pursuant to subsection
4.05(b)(ii) or 4.05(c)(ii) of the Agreement with respect to the Revolving
Period or Accumulation Period, respectively, and (II) an amount equal to
the amount of Excess Principal Collections to be applied for the benefit of
other Series from amounts that were originally allocated to Series 1996-2,
not to exceed (x) during the Revolving Period, the Floating Allocation
Percentage of Collections of Principal Receivables for the related Monthly
Period or (y) during the Accumulation Period, the Fixed/Floating Allocation
Percentage of Collections of Principal Receivables for the related Monthly
Period less the amount thereof applied to pay Monthly Principal on the
related Distribution Date.
(g) Notwithstanding anything in this Section 4.05, if on any
date the aggregate amount of Principal Receivables is less than the sum of
the Invested Amounts for all Series then outstanding, all Collections of
Principal Receivables on such date shall be deposited and applied in
accordance with subsection 4.03(f) of the Agreement.
The allocations to be made pursuant to this Section 4.05 of the
Agreement also apply to deposits into the Collection Account that are
treated as Collections, including Credit Adjustments, payment of the
reassignment price pursuant to Section 2.07 of the Agreement and proceeds
from the sale, disposition or liquidation of the Receivables pursuant to
Section 9.02, 10.01, 12.01 or 12.02 of the Agreement and Section 3 of the
Series Supplement for Series 1996-2. Such deposits to be treated as
Collections will be allocated as Finance Charge Receivables or Principal
Receivables as indicated in the Agreement.
Section 4.06 Determination of Monthly Interest for the Series
------------------------------------------------
1996-2 Certificates. (a) The amount of monthly interest (for the Series
-------------------
1996-2 Certificates, the "Class A Monthly Interest") distributable from the
------------------------
Distribution Account with respect to the Class A Certifi-
33
<PAGE>
cates on any Distribution Date shall be an amount equal to the product of
(i) the product of (x) the Class A Certificate Rate and (y) a fraction the
numerator of which is the actual number of days in the related Interest
Period and the denominator of which is 360 and (ii) the Class A Outstanding
Principal Balance as of the close of business on the last day of the
preceding Monthly Period; provided, however, that with respect to the first
-------- -------
Distribution Date, Class A Monthly Interest shall be equal to the product
of (i) the product of (a) the Class A Certificate Rate for the period from
and including June 4, 1996 to and including July 9, 1996 and (b) a fraction
the numerator of which is 36 and the denominator of which is 360 and (ii)
the Class A Initial Invested Amount.
On the Determination Date preceding each Distribution Date, the
Servicer shall determine an amount (the "Class A Interest Shortfall") equal
--------------------------
to the excess, if any, of (x) the aggregate Class A Monthly Interest for
the Interest Period applicable to the preceding Distribution Date over (y)
----
the amount which was paid to the Class A Certificateholders in respect of
interest on such preceding Distribution Date. If there is a Class A
Interest Shortfall with respect to any Distribution Date, an additional
amount ("Class A Default Interest") shall be payable as provided herein
------------------------
with respect to the Class A Certificates on each Distribution Date
following such Distribution Date to and including the Distribution Date on
which such Class A Interest Shortfall is paid to Class A Certificateholders
equal to the product of (i) the product of (x) the Class A Certificate Rate
plus 2.00% per annum and (y) a fraction the numerator of which is the
actual number of days in the related Interest Period and the denominator of
which is 360 and (ii) such Class A Interest Shortfall. Notwithstanding
anything to the contrary herein, Class A Default Interest shall be payable
or distributed to Class A Certificateholders only to the extent permitted
by applicable law.
(b) The amount of monthly interest (for the Series 1996-2
Certificates, the "Class B Monthly Interest") distributable from the
------------------------
Distribution Account with respect to the Class B Certificates on any
Distribution Date shall be an amount equal to the product of (i) the
product of (x) the Class B Certificate Rate and (y) a fraction the
numerator of which is the actual number of days in the related Interest
Period and the denominator of which is 360 and (ii) the Class B Invested
Amount as of the close of business on the last day of the preceding
34
<PAGE>
Monthly Period; provided, however, that with respect to the first
-------- -------
Distribution Date, Class B Monthly Interest shall be equal to the product
of (i) the product of (a) the Class B Certificate Rate for the period from
and including June 4, 1996 to and including July 9, 1996 and (b) a fraction
the numerator of which is 36 and the denominator of which is 360 and (ii)
the Class B Initial Invested Amount.
On the Determination Date preceding each Distribution Date, the
Servicer shall determine an amount (the "Class B Interest Shortfall") equal
--------------------------
to the excess, if any, of (x) the aggregate Class B Monthly Interest for
the Interest Period applicable to the preceding Distribution Date over (y)
----
the amount which was paid to the Class B Certificateholders in respect of
interest on such preceding Distribution Date. If there is a Class B
Interest Shortfall with respect to any Distribution Date, an additional
amount ("Class B Default Interest") shall be payable as provided herein
------------------------
with respect to the Class B Certificates on each Distribution Date
following such Distribution Date to and including the Distribution Date on
which such Class B Interest Shortfall is paid to Class B Certificateholders
equal to the product of (i) the product of (x) the Class B Certificate Rate
plus 2.00% per annum and (y) a fraction the numerator of which is the
actual number of days in the related Interest Period and the denominator of
which is 360 and (ii) such Class B Interest Shortfall. Notwithstanding
anything to the contrary herein, Class B Default Interest shall be payable
or distributed to Class B Certificateholders only to the extent permitted
by applicable law.
(c) The amount of monthly interest (for the Series 1996-2
Certificates, the "CIA Monthly Interest") distributable from the
--------------------
Distribution Account with respect to the CIA Invested Amount on any
Distribution Date shall be an amount equal to the product of (i) the
product of (x) the CIA Certificate Rate and (y) a fraction the numerator of
which is the actual number of days in the related Interest Period and the
denominator of which is 360 and (ii) the CIA Invested Amount as of the
close of business on the last day of the preceding Monthly Period;
provided, however, that with respect to the first Distribution Date, CIA
-------- -------
Monthly Interest shall be equal to the product of (i) the product of (a)
the CIA Certificate Rate for the period from and including June 4, 1996 to
and including July 9, 1996 and (b) a fraction
35
<PAGE>
the numerator of which is 36 and the denominator of which is 360 and (ii)
the CIA Initial Invested Amount.
On the Determination Date preceding each Distribution Date, the
Servicer shall determine an amount (the "CIA Interest Shortfall") equal to
----------------------
the excess, if any, of (x) the aggregate CIA Monthly Interest for the
Interest Period applicable to the preceding Distribution Date over (y) the
----
amount which was paid to the CIA Certificateholders in respect of interest
on such preceding Distribution Date pursuant to the terms hereof and of the
Spread Account Agreement. If there is a CIA Interest Shortfall with
respect to any Distribution Date, an additional amount ("CIA Default
-----------
Interest") shall be payable as provided herein with respect to the CIA
--------
Certificates on each Distribution Date following such Distribution Date to
and including the Distribution Date on which such CIA Interest Shortfall is
paid to the CIA Certificateholders equal to the product of (i) the product
of (a) the CIA Certificate Rate plus 2.00% per annum and (b) a fraction the
numerator of which is the actual number of days in the related Interest
Period and the denominator of which is 360 and (ii) such CIA Interest
Shortfall. Notwithstanding anything to the contrary herein, CIA Default
Interest shall be payable or distributed to the CIA Certificateholders only
to the extent permitted by applicable law.
Section 4.07 Determination of Monthly Principal. (a) The
----------------------------------
amount of monthly principal (the "Class A Monthly Principal") distributable
-------------------------
from the Principal Account with respect to the Class A Certificates on each
Transfer Date beginning with the Transfer Date in the month following the
month in which the 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 Accumulation Period prior to the Class A Scheduled Payment Date, the
Controlled Deposit Amount for such Transfer Date and (iii) the Class A
Adjusted Invested Amount 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 (the "Class B Monthly
---------------
Principal") distributable from the Principal Account with respect to the
---------
Class B Certificates on each Transfer Date, beginning with the Transfer
36
<PAGE>
Date first preceding the Class B Principal Commencement Date, 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),
(ii) for each Transfer Date with respect to the Accumulation Period prior
to the Class B Scheduled Payment Date, the Controlled Deposit Amount for
such Transfer Date (minus the Class A Monthly Principal for such Transfer
Date) and (iii) the Class B Adjusted Invested Amount on such Transfer Date
(after taking into account any adjustments to be made on such Transfer Date
pursuant to Sections 4.12 and 4.14 of the Agreement on such Transfer Date).
(c) The amount of monthly principal (the "CIA Monthly Principal")
---------------------
distributable from the Principal Account with respect to the CIA
Certificates on each Transfer Date, beginning with the Transfer Date first
preceding the CIA Principal Commencement Date, 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 and Class B Monthly Principal on such Transfer Date),
(ii) for each Transfer Date with respect to the Accumulation Period prior
to the Class B Scheduled Payment Date, the Controlled Deposit Amount for
such Transfer Date (minus the Class A Monthly Principal and the Class B
Monthly Principal for such Transfer Date) and (iii) the CIA Adjusted
Invested Amount on such Transfer Date (after taking into account any
adjustments to be made on such Transfer Date pursuant to Sections 4.12 and
4.14 of the Agreement on such Transfer Date).
Section 4.08 Coverage of Required Amount for the Investor
--------------------------------------------
Certificates. On each Determination Date, the Servicer shall determine the
------------
amount (the "Class A Required Amount"), if any, by which the sum of (i)
-----------------------
Class A Monthly Interest for the following Distribution Date, (ii) any
Class A Monthly Interest previously due but not paid to the Class A
Certificateholders on a prior Distribution Date, (iii) Class A Default
Interest, if any, for such Distribution Date and any Class A Default
Interest previously due but not paid to the Class A Certificateholders on a
prior Distribution Date, (iv) if First USA Bank is no longer the Servicer,
the Class A Monthly
37
<PAGE>
Servicing Fee for the related Distribution Date and (v) the Class A
Investor Default Amount, if any, for such Distribution Date exceeds the
Class A Available Funds for the related Monthly Period.
On each Determination Date, the Servicer shall determine the
amount (the "Class B Required Amount"), if any, equal to the sum of (x) the
-----------------------
amount, if any, by which the sum of (i) Class B Monthly Interest for the
following Distribution Date, (ii) any Class B Monthly Interest previously
due but not paid to the Class B Certificateholders on a prior Distribution
Date, (iii) Class B Default Interest, if any, for such Distribution Date
and any Class B Default Interest previously due but not paid to the Class B
Certificateholders on a prior Distribution Date and (iv) if First USA Bank
is no longer the Servicer, the Class B Monthly Servicing Fee for the
related Distribution Date exceeds the Class B Investor Percentage of
Collections in respect of Finance Charge Receivables deposited in the
Finance Charge Account for the related Monthly Period and (y) the amount,
if any, by which the Class B Investor Default Amount, if any, for such
Distribution Date exceeds the amount of Excess Finance Charge Collections
available to make payments with respect thereto pursuant to subsection
4.13(d) of the Agreement.
In the event that the sum of the Class A Required Amount and the
Class B Required Amount for such Distribution Date is greater than zero,
the Servicer shall give written notice to the Trustee of such positive
Class A Required Amount or Class B Required Amount on the Determination
Date. In the event that the Class A Required Amount for such Distribution
Date is greater than zero all or a portion of the Excess Finance Charge
Collections with respect to the related Transfer Date in an amount equal to
the Class A Required Amount for such Distribution Date shall be distributed
from the Finance Charge Account on such Distribution Date pursuant to
subsection 4.13(a) of the Agreement. In the event that the Class A
Required Amount for such Transfer Date exceeds the amount of Excess Finance
Charge Collections with respect to such Transfer Date, the Collections of
Principal Receivables allocable to the CIA Certificates 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 4.14
of the Agreement. In the event that after the application of Excess
Finance Charge Collections there is a
38
<PAGE>
Class B Required Amount for such Transfer Date, the Collections of
Principal Receivables allocable to the CIA Certificates (after application
to the Class A Required Amount) shall be applied as specified in Section
4.14 of the Agreement; provided, however, that the sum of any payments
-------- -------
pursuant to this paragraph shall not exceed the sum of the Class A Required
Amount and the Class B Required Amount.
Section 4.09 Monthly Payments. On each Transfer Date, the
----------------
Trustee, acting in accordance with written instructions from the Servicer
substantially in the form of Exhibit E hereto, shall make the withdrawals,
deposits and payments specified in subsections (a) through (h) of this
Section 4.09.
(a) On the Transfer Date preceding each Distribution Date,
an amount equal to the Class A Available Funds deposited or deemed to have
been deposited into the Finance Charge Account for the related Monthly
Period will be distributed in the following priority:
(i) an amount equal to Class A Monthly Interest for such
Distribution Date, plus the amount of any Class A Monthly Interest
----
previously due but not paid to Class A Certificateholders on a prior
Distribution Date, plus the amount of any Class A Default Interest for
----
such Distribution Date, shall be deposited by the Servicer or the
Trustee into the Distribution Account;
(ii) if First USA Bank is no longer the Servicer, an amount
equal to the Class A Monthly Servicing Fee for such Distribution Date
shall be distributed to the Servicer;
(iii) an amount equal to the aggregate Class A Investor
Default Amount, if any, for such Distribution Date shall be (A)
distributed to the Holder of the Exchangeable Transferor Certificate
on Distribution Dates with respect to the Revolving Period, but not
exceeding the Transferor Interest (determined as of such Distribution
Date after giving effect to any Principal Receivables transferred to
the Trust during the Monthly Period relating to such Distribution
Date, any such amount in excess of the Transferor Interest to be
treated as Unallocated Principal Collections) and (B) deposited in the
Principal Account and treated as a portion of Avail-
39
<PAGE>
able Investor Principal Collections for Distribution Dates with
respect to the Amortization Period; and
(iv) the balance, if any, shall constitute Excess Finance
Charge Collections and shall be allocated and distributed as set forth
in Section 4.13 of the Agreement.
(b) On the Transfer Date preceding each Distribution Date,
an amount equal to the Class B Floating Allocation Percentage of
Collections in respect of Finance Charge Receivables deposited or deemed to
have been deposited in the Finance Charge Account for the related Monthly
Period will be distributed in the following priority:
(i) an amount equal to the Class B Monthly Interest for such
Distribution Date, plus the amount of any Class B Monthly Interest
----
previously due but not paid to the Class B Certificateholders on a
prior Distribution Date, plus the amount of any Class B Default
----
Interest for such Distribution Date, shall be deposited by the
Servicer or the Trustee into the Distribution Account;
(ii) if First USA Bank is no longer the Servicer, an amount
equal to the Class B Monthly Servicing Fee for such Distribution Date
shall be distributed to the Servicer; and
(iii) the balance, if any, shall constitute Excess Finance
Charge Collections and shall be allocated and distributed as set forth
in Section 4.13 of the Agreement.
(c) On the Transfer Date preceding each Distribution Date,
an amount equal to the CIA Floating Allocation Percentage of Collections in
respect of Finance Charge Receivables deposited or deemed to have been
deposited in the Finance Charge Account for the related Monthly Period will
be distributed in the following priority:
(i) if First USA Bank is no longer the Servicer, an amount
equal to the CIA Monthly Servicing Fee for such Distribution Date
shall be distributed to the Servicer; and
40
<PAGE>
(ii) the balance, if any, shall constitute Excess Finance
Charge Collections and shall be allocated and distributed as set forth
in Section 4.13 of the Agreement.
(d) On each Transfer Date during the Revolving Period, the
Trustee shall distribute an amount equal to the Available Investor
Principal Collections deposited or deemed to have been deposited into the
Principal Account for the related Monthly Period in the following priority:
(i) 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 and the denominator of which is equal to the sum
of the Principal Collections available for sharing as specified in the
related Series Supplement for each Series and (2) the Principal
Shortfall applicable to such other Series and (B) remaining Available
Investor Principal Collections, shall be treated as Excess Principal
Collections and be deposited in the applicable principal accounts for
such other Series with Principal Shortfalls; and
(ii) 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 subsection 4.09(d)(i) above shall be
paid to the Holder of the Exchangeable Transferor Certificate;
provided, however, that the amount to be paid to the Holder of the
-------- -------
Exchangeable Transferor Certificate pursuant to this subsection
4.09(d)(ii) with respect to such Transfer Date shall be paid to the
Holder of the Exchangeable Transferor Certificate only if the
Transferor Interest on the related Date of Processing is greater than
zero (after giving effect to the inclusion in the Trust of all
Receivables created on or prior to such Transfer Date and after giving
effect to Collections of Principal Receivables on such Transfer Date)
and otherwise shall be considered as Unallocated Principal Collections
and deposited into the Principal Account in accordance with subsection
4.03(f).
(e) On each Transfer Date, during the Accumulation Period or
the Rapid Amortization Period, the Trustee shall distribute an amount equal
to the Available Investor Principal Collections deposited or deemed to
41
<PAGE>
have been deposited into the Principal Account for the related Monthly
Period in the following priority:
(i) an amount equal to the Class A Monthly Principal for
such Transfer Date plus, to the extent of any applicable Principal
----
Shortfall for the related Distribution Date, Excess Principal
Collections from other Series, to the extent available, shall be (A)
during the 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
plus, to the extent of any applicable Principal Shortfall for the
----
related Distribution Date, Excess Principal Collections from other
Series, to the extent available, shall be deposited into the
Distribution Account;
(iii) after giving effect to the distributions referred to
in clauses (i) and (ii) above, an amount equal to the CIA Monthly
Principal plus, to the extent of any applicable Principal Shortfall
----
for the related Distribution Date, Excess Principal Collections from
other Series, to the extent available, shall be deposited into the
Distribution Account;
(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 4.09(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 other Series and (2) the Principal Shortfalls for
all Series and (B) the Available Investor Principal Collections, shall
remain in the Principal Account to be treated as Excess Principal
Collections and applied to Series other than this Series 1996-2; and
(v) an amount equal to the excess, if any, of (A) the
Available Investor Principal Collections over (B) the applications
specified in subsection 4.09(e)(i) through (iv) above shall be paid to
42
<PAGE>
the Holder of the Exchangeable Transferor Certificate; provided,
--------
however, that the amount to be paid to the Holder of the Exchangeable
-------
Transferor Certificate pursuant to this subsection 4.09(e)(v) with
respect to such Transfer Date shall be paid to the Holder of the
Exchangeable Transferor Certificate only if the Transferor Interest on
the related Date of Processing is greater than zero (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 4.03(b) of the Agreement) and otherwise shall be
considered as Unallocated Principal Collections and deposited into the
Principal Account in accordance with subsection 4.03(f) of the
Agreement; provided, further, that in no event shall the amount
-------- -------
payable to the Holder of the Exchangeable Transferor Certificate
pursuant to this subsection 4.09(e)(v) be greater than the Transferor
Interest on such Transfer Date.
(f) 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 Trustee shall withdraw
from the Principal Funding Account and deposit in the Distribution Account
the amount on deposit in the Principal Funding Account.
(g) [Reserved]
(h) On the earlier to occur of the first Distribution Date with
respect to the Rapid Amortization Period or the Class A Scheduled Payment
Date and on each Distribution Date thereafter, the Trustee shall pay in
accordance with Section 5.01 of the Agreement from the Distribution Account
the amount so deposited into the Distribution Account pursuant to
subsection 4.09(f) of the Agreement 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 Invested Amount shall be
paid to the Class A Certificateholders;
(ii) on the Class B Principal Commencement Date and on each
Distribution Date thereafter, after giving effect to the distributions
referred to
43
<PAGE>
in clause (i) above, an amount equal to the lesser of such amount on
deposit in the Distribution Account and the Class B Invested Amount
shall be paid to the Class B Certificateholders; and
(iii) on the CIA Principal Commencement Date and on each
Distribution Date thereafter, after giving effect to the distributions
referred to in clauses (i) and (ii) above, an amount equal to the
lesser of such amount on deposit in the Distribution Account and the
CIA Invested Amount shall be paid to the CIA Certificateholders.
(i) The Accumulation Period is scheduled to commence at the close
of business on May 31, 2002; provided, however, that, if the Accumulation
-------- -------
Period Length (determined as described below) is less than 12 months, the
date on which the Accumulation Period actually commences may, at the option
of the Servicer, upon written notice to the Trustee, be delayed to the
first Business Day of the month that is the number of 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 Accumulation
Period will at least equal the Accumulation Period Length. On the
Determination Date immediately preceding the February 2002 Distribution
Date, and each Determination Date thereafter until the Accumulation Period
begins, the Servicer will determine the "Accumulation Period Length" which
--------------------------
will equal the number of months such that the sum of the Accumulation
Period Factors for each month during such period will be equal to or
greater than the Required Accumulation Factor Number; provided, however,
-------- -------
that the Accumulation Period Length will not be less than one month.
Section 4.10 Payment of Certificate Interest. On each
-------------------------------
Distribution Date, the Paying Agent shall pay in accordance with Section
5.01 of the Agreement to the Class A Certificateholders from the
Distribution Account the amount deposited into the Distribution Account
pursuant to subsections 4.09(a)(i), 4.13(a), 4.14(a)(i)(x) and 4.14(b)(i)
of the Agreement on the related Transfer Date or such Distribution Date, as
applicable, to the Class B Certificateholders from the Distribution Account
the amount deposited into the Distribution Account pursuant to subsections
4.09(b)(i), 4.13(c) and 4.14(a)(i)(y) of the Agreement on the related
Transfer Date and to the CIA Certificateholders from the Distribution
Account the
44
<PAGE>
amount deposited into the Distribution Account pursuant to subsection
4.13(f) of the Agreement on such Distribution Date.
Section 4.11 [Reserved]
Section 4.12 Investor Charge-Offs.
--------------------
(a) On each Distribution Date, the Servicer shall calculate the
Class A Investor Default Amount. If on any Distribution Date, the Class A
Investor Default Amount for such Distribution Date exceeds the sum of the
amount allocated with respect thereto pursuant to subsection 4.09(a)(iii),
subsection 4.13(a) and Section 4.14 of the Agreement with respect to the
Monthly Period immediately preceding such Distribution Date, the CIA
Invested Amount will be reduced by the amount of such excess, but not more
than the lesser of the Class A Investor Default Amount and the CIA Invested
Amount for such Distribution Date. In the event that such reduction would
cause the CIA Invested Amount to be a negative number, the CIA Invested
Amount will be reduced to zero, and the Class B Invested Amount will be
reduced by the amount by which the CIA Invested Amount would have been
reduced below zero. In the event that such reduction would cause the Class
B Invested Amount to be a negative number, the Class B Invested Amount will
be reduced to zero, and the Class A Invested Amount will be reduced by the
amount by which the Class B Invested Amount would have been reduced below
zero, but not more than the Class A Investor Default Amount for such
Distribution Date (a "Class A Investor Charge-Off"). If the Class A
---------------------------
Invested Amount has been reduced by the amount of any Class A Investor
Charge-Offs, it will be reimbursed on any Distribution Date (but not by an
amount in excess of the aggregate Class A Investor Charge-Offs) by the
amount of Excess Finance Charge Collections allocated and available for
such purpose pursuant to subsection 4.13(b) of the Agreement.
(b) On each Distribution Date, the Servicer shall calculate the
Class B Investor Default Amount. If on any Distribution Date, the Class B
Investor Default Amount for such Distribution Date exceeds the amount of
Excess Finance Charge Collections and Reallocated Principal Collections
which are allocated and available to fund such amount pursuant to
subsection 4.13(d) and Section 4.14 of the Agreement, the CIA Invested
Amount (after giving effect to any adjustments
45
<PAGE>
with respect thereto as described in the preceding paragraph) will be
reduced by the amount of such excess but not more than the lesser of the
Class B Investor Default Amount and the CIA Invested Amount for such
Distribution Date. In the event that such reduction would cause the CIA
Invested Amount to be a negative number, the CIA Invested Amount shall be
reduced to zero and the Class B Invested Amount shall be reduced by the
amount by which the CIA Invested Amount would have been reduced below zero,
but not more than the Class B Investor Default Amount for such Distribution
Date (a "Class B Investor Charge-Off"). The Class B Invested Amount will
---------------------------
also be reduced by the amount of Reallocated Class B Principal Collections
in excess of the CIA Invested Amount pursuant to Section 4.14 of the
Agreement and the amount of any portion of the Class B Invested Amount
allocated to the Class A Certificates to avoid a reduction in the Class A
Invested Amount pursuant to subsection 4.12(a) of the Agreement. The Class
B Invested Amount will thereafter be reimbursed (but not in the excess of
the unpaid principal balance of the Class B Certificates) on any
Distribution Date by the amount of Excess Finance Charge Collections
allocated and available for that purpose as described under subsection
4.13(e) of the Agreement.
(c) On each Distribution Date, the Servicer shall calculate the
CIA Investor Default Amount. If on any Distribution Date, the CIA Investor
Default Amount for such Distribution Date exceeds the amount of Excess
Finance Charge Collections which are allocated and available to fund such
amount pursuant to subsection 4.13(h) of the Agreement, the CIA Invested
Amount (after giving effect to any adjustments with respect thereto as
described in the preceding paragraphs) will be reduced by the amount of
such excess but not more than the lesser of the CIA Investor Default Amount
and the CIA Invested Amount for such Distribution Date (a "CIA Investor
------------
Charge-Off"). The CIA Invested Amount will also be reduced by the amount
----------
of Reallocated Principal Collections pursuant to Section 4.14 of the
Agreement and the amount of any portion of the CIA Invested Amount
allocated to the Class A Certificates or the Class B Certificates to avoid
a reduction in the Class A Invested Amount, pursuant to subsection 4.12(a)
of the Agreement, or the Class B Invested Amount, pursuant to subsection
4.12(b) of the Agreement, respectively. The CIA Invested Amount will
thereafter be reimbursed (but not in the excess of the unpaid principal
balance of the CIA Certificates) on any Distribution Date by the amount of
Excess
46
<PAGE>
Finance Charge Collections allocated and available for that purpose as
described under subsection 4.13(i) of the Agreement.
Section 4.13 Excess Finance Charge Collections for the Series
------------------------------------------------
1996-2 Certificates. On each Transfer Date, the Servicer will apply or
-------------------
cause the Trustee to apply Excess Finance Charge Collections with respect
to the related Monthly Period, to make the following distributions in the
following priority:
(a) an amount equal to the Class A Required Amount, if any, with
respect to the related Monthly Period will be used to fund the Class A
Required Amount and be applied in accordance with subsection 4.09(a) of the
Agreement;
(b) an amount equal to the aggregate amount of Class A Investor
Charge-Offs, which have not been previously reimbursed (after giving effect
to the allocation with respect to the related Distribution Date of certain
other amounts applied for that purpose) will be distributed to the Holder
of the Exchangeable Transferor Certificate on Transfer Dates with respect
to the Revolving Period, but not exceeding the Transferor Interest in
Principal Receivables (determined as of such Transfer Date after giving
effect to any Principal Receivables transferred to the Trust on such date)
and on Transfer Dates with respect to the Amortization Period, will be
deposited in the Principal Account and treated as a portion of Available
Investor Principal Collections for the related Distribution Date;
(c) an amount equal to the amount of interest which has accrued
with respect to the Class B Outstanding Principal Balance at the applicable
Class B Certificate Rate but has not been deposited in the Distribution
Account for the benefit of the Class B Certificateholders either on such
Transfer Date or on a prior Transfer Date and any other amounts due and
owing on the related Distribution Date pursuant to subsection 4.09(b)(i) of
the Agreement will be deposited into the Distribution Account for payment
to the Class B Certificateholders;
(d) an amount equal to the aggregate Class B Investor Default
Amount, if any, for the related Distribution Date will be distributed to
the holder of the Exchangeable Transferor Certificate on Transfer Dates
47
<PAGE>
with respect to the Revolving Period (but not exceeding the Transferor
Interest in Principal Receivables (determined as of such Transfer Date
after giving effect to any Principal Receivables transferred to the Trust
on such date)), and on Transfer Dates with respect to the Amortization
Period will be deposited in the Principal Account and treated as a portion
of Available Investor Principal Collections for the related Distribution
Date;
(e) an amount equal to the aggregate amount by which the Class B
Invested Amount has been reduced below the initial Class B Invested Amount
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) will be distributed
to the Transferor on Transfer Dates with respect to the Revolving Period,
but not in an amount exceeding the Transferor Interest in Principal
Receivables on such day (after giving effect to any new Receivables
transferred to the Trust on such day) and on Transfer Dates with respect to
the Amortization Period will be deposited in the Principal Account and
treated as a portion of Available Investor Principal Collections for the
related Distribution Date;
(f) an amount equal to the CIA Monthly Interest for the related
Distribution Date, plus the amount of any CIA Monthly Interest previously
due but not paid to the CIA Certificateholders on a prior Distribution
Date, plus the amount of any CIA Default Interest for the related
Distribution Date, will be deposited into the Distribution Account for
payment to the CIA Certificateholders;
(g) an amount equal to the Unpaid Investor Monthly Servicing Fee
will be paid to the Servicer;
(h) an amount equal to the aggregate CIA Investor Default Amount,
if any, for the related Distribution Date will be distributed to the holder
of the Exchangeable Transferor Certificate on Transfer Dates with respect
to the Revolving Period (but not exceeding the Transferor Interest in
Principal Receivables (determined as of such Transfer Date after giving
effect to any Principal Receivables transferred to the Trust on such
date)), and on Transfer Dates with respect to the Amortization Period will
be deposited in the Principal Account and treated as a portion of Available
Investor Principal Collections for the related Distribution Date;
48
<PAGE>
(i) an amount equal to the aggregate amount by which the CIA
Invested Amount has been reduced below the initial CIA Invested Amount for
reasons other than the payment of principal to the CIA Certificateholders
(but not in excess of the aggregate amount of such reductions which have
not been previously reimbursed) will be distributed to the holder of the
Exchangeable Transferor Certificate on Transfer Dates with respect to the
Revolving Period, but not in an amount exceeding the Transferor Interest in
Principal Receivables on such day (after giving effect to any new
Receivables transferred to the Trust on such day) and on Transfer Dates
with respect to the Amortization Period will be deposited in the Principal
Account and treated as a portion of Available Investor Principal
Collections for the related Distribution Date;
(j) on each Transfer Date from and after the Reserve Account
Funding Date, but prior to the date on which the Reserve Account terminates
as described in subsection 4.17(f) of the Agreement, 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; and
(k) the balance, if any, after giving effect to the payments made
pursuant to subparagraphs (a) through (j) above shall be applied in
accordance with the provisions of the Spread Account Agreement.
Section 4.14 Reallocated Principal Collections for the Series
------------------------------------------------
1996-2 Certificates.
-------------------
(a) On each Distribution Date, the Servicer will apply or cause
the Trustee to apply an amount, not to exceed the CIA Invested Amount,
equal to the product of (a)(i) during the Revolving Period, the CIA
Floating Allocation Percentage or (ii) during an Amortization Period, the
CIA Fixed/Floating Allocation Percentage and (b) the amount of Collections
of Principal Receivables with respect to the related Monthly Period in the
following priority (such collections applied in accordance with clause (i)
below are called "Reallocated CIA Principal Collections"):
-------------------------------------
(i) an amount equal to the sum of (x) the excess, if any, of
the Class A Required Amount with respect to such related Monthly
Period over the amount of Excess Finance Charge Collections with
49
<PAGE>
respect to such related Monthly Period and (y) the Class B Required
Amount with respect to the related Monthly Period which amount shall
be applied in priority first pursuant to subsections 4.09(a)(i)
through (iii) of the Agreement and then pursuant to subsections
4.09(b)(i) and (ii) and 4.13(d) of the Agreement; and
(ii) any such collections not applied in the foregoing
manner (and therefore not constituting Reallocated CIA Principal
Collections) will, on Distribution Dates with respect to the Revolving
Period, be applied as Available Investor Principal Collections.
(b) On each Distribution Date, the Servicer will apply or cause
the Trustee to apply an amount, not to exceed the Class B Invested Amount,
equal to the product of (a)(i) during the Revolving Period, the Class B
Floating Allocation Percentage or (ii) during an Amortization Period, the
Class B Fixed/Floating Allocation Percentage and (b) the amount of
Collections of Principal Receivables with respect to the related Monthly
Period in the following priority (such collections applied in accordance
with clause (i) below are called "Reallocated Class B Principal
-----------------------------
Collections"):
-----------
(i) an amount equal to the excess, if any, of the Class A
Required Amount with respect to such related Monthly Period over the
sum of (x) the amount of Excess Finance Charge Collections with
respect to such related Monthly Period and (y) the amount of
Reallocated CIA Principal Collections applied with respect thereto for
the related Monthly Period shall be applied in priority pursuant to
subsection 4.09(a)(i) through (iii) of the Agreement; and
(ii) any such collections not applied in the foregoing
manner (and therefore not constituting Reallocated Class B Principal
Collections) will, on Distribution Dates with respect to the Revolving
Period, be applied as Available Investor Principal Collections.
On each Distribution Date the CIA Invested Amount shall be
reduced by the amount of Reallocated CIA Principal Collections and by the
amount of Reallocated Class B Principal Collections for such Distribution
Date.
50
<PAGE>
In the event that such reduction would cause the CIA Invested Amount to be
a negative number, the CIA Invested Amount shall be reduced to zero and the
Class B Invested Amount shall be reduced by the amount by which the CIA
Invested Amount would have been reduced below zero. In the event that the
reallocation of Principal Collections would cause the Class B Invested
Amount to be a negative number on any Distribution Date, Principal
Collections shall be reallocated on such Distribution Date in an aggregate
amount not to exceed the amount which would cause the Class B Invested
Amount to be reduced to zero.
Section 4.15 Determination of LIBOR.
----------------------
(a) On May 31, 1996 and 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
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 Class A Certificate Rate, the Class B Certificate Rate
and the CIA Certificate Rate applicable to the then current and the
immediately preceding Interest Periods may be obtained by any Series 1996-2
Certificateholder by telephoning the Paying Agent at its corporate trust
office at (212) 815-5737.
(c) On each LIBOR Determination Date, the Trustee shall send to
the Servicer by facsimile notification of LIBOR for the following Interest
Period.
51
<PAGE>
The Trustee shall cause the Class A Certificate Rate and the Class B
Certificate Rate applicable to an Interest Period to be provided to the
Luxembourg Stock Exchange as soon as possible after its determination but
in no event later than the first day of such Interest Period. In addition
the Trustee shall cause the Class A Monthly Interest and Class B Monthly
Interest applicable to an Interest Period to be provided to the Luxembourg
Stock Exchange within one Business Day of the date on which the Trustee
receives notification of the Class A Monthly Interest and the Class B
Monthly Interest from the Servicer.
Section 4.16 Principal Funding Account.
-------------------------
(a) The Servicer shall establish and maintain with a Qualified
Institution, which may be the Trustee, in the name of the Trustee, on
behalf of the Trust, for the benefit of the Investor Certificateholders, a
segregated trust account with the corporate trust department of such
Qualified Institution (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 any
time the institution holding the Principal Funding Account ceases to be a
Qualified Institution the Transferor shall notify the Trustee, and the
Trustee upon being notified (or the Servicer on its behalf) shall, within
ten (10) Business Days, establish a new Principal Funding Account meeting
the conditions specified above with a Qualified Institution, and shall
transfer any cash or any investments to such new Principal Funding Account.
The Trustee, at the written 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 Supplement, and (ii) on each
Transfer Date (from and after the commencement of the 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 4.09(e) of the Agreement.
52
<PAGE>
(b) Funds on deposit in the Principal Funding Account shall be
invested at the written 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 the following 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 Accumulation Period and on each Transfer Date
thereafter with respect to the Accumulation Period, the Trustee, acting at
the Servicer's written direction given on such Transfer Date, shall (x)
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 pursuant to subsection 4.09(a)(i) of the
Agreement and (y) pay any excess Principal Funding Investment Proceeds to
the Transferor. An amount equal to any Principal Funding Investment
Shortfall will be deposited in the Finance Charge Account on each Transfer
Date from the Reserve Account to the extent funds are available pursuant to
subsection 4.17(d) of the Agreement. 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 4.17 Reserve Account.
---------------
(a) The Servicer shall establish and maintain with a Qualified
Institution, which may be the Trustee, in the name of the Trustee, on
behalf of the Trust, for the benefit of the Investor Certificateholders, a
segregated trust account with the corporate trust department of such
Qualified Institution (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
53
<PAGE>
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 a
Qualified Institution 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 above with a Qualified Institution, and shall transfer any cash
or any investments to such new Reserve Account. The Trustee, at the
written direction of the Servicer, shall (i) make withdrawals from the
Reserve Account from time to time in an amount up to the Available Reserve
Account Amount at such time, for the purposes set forth in this 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 4.13(j) of the Agreement.
(b) Funds on deposit in the Reserve Account shall be invested at
the written 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
following 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 for application as Collections of Finance Charge
Receivables allocable to the Class A Certificates on such Transfer Date.
For purposes of determining the availability of funds or the balance in the
Reserve Account for any reason under this Supplement, except as otherwise
provided in the preceding sentence, investment earnings
54
<PAGE>
on such funds shall be deemed not to be available or on deposit.
(c) On each Transfer Date with respect to the Accumulation Period
prior to the payment in full of the Class A Invested Amount and 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 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 subsection 4.13(j) of
the Agreement 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 written
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 written instructions of the
Servicer, shall withdraw from the Reserve Account, and apply as Excess
Finance Charge Collections, an amount equal to such Reserve Account
Surplus.
(f) Upon the earliest to occur of (i) the termination of the
Trust pursuant to Article XII of the Agreement, (ii) the day on which the
Class A Invested Amount is paid in full to the Class A Certificateholders,
(iii) if the Accumulation Period has not commenced, the occurrence of a Pay
Out Event with respect to Series 1996-2 and (iv) if the Accumulation Period
has commenced, the earlier of the first Transfer Date with respect to the
Rapid Amortization Period and the Class A Scheduled Payment Date, the
Trustee, acting in accordance with the written instructions of the
Servicer, after the prior payment of all amounts owing to the Series 1996-2
Certificateholders that are payable from the Reserve Account as
55
<PAGE>
provided herein, shall withdraw from the Reserve Account and apply as
Excess Finance Charge Collections, all amounts, if any, on deposit in the
Reserve Account and the Reserve Account shall be deemed to have terminated
for purposes of this Supplement.
SECTION 7. Article V of the Agreement. Article V of the
--------------------------
Agreement shall read in its entirety as follows and shall be applicable
only to the Series 1996-2 Certificates:
ARTICLE V
DISTRIBUTIONS AND REPORTS TO INVESTOR
CERTIFICATEHOLDERS
Section 5.01 Distributions.
-------------
(a) On each Distribution Date, the Paying Agent shall distribute
(in accordance with the certificate delivered by the Servicer to the
Trustee pursuant to subsection 3.04(b) of the Agreement) to each Class A
Certificateholder of record on the preceding Record Date (other than as
provided in subsection 2.04(e) or in Section 12.03 of the Agreement
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 subsection 4.09(h) and Section 4.10 of the Agreement by check
mailed to each Class A Certificateholder at such Certificateholder's
address as it appears on the Certificate Register or, in the case of Class
A Certificateholders holding Class A Certificates evidencing Undivided
Interests aggregating not less than 80% of the Invested Amount, by wire
transfer, at the expense of such Class A Certificateholder, to an account
or accounts designated by such Class A Certificateholder by written notice
given to the Paying Agent not less than five days prior to the related
Distribution Date; provided, however, that the final payment in retirement
-------- -------
of the Class A Certificates will be made only upon presentation and
surrender of the Class A Certificates at the office or offices specified in
the notice of such final distribution delivered by the Trustee pursuant to
Section 12.03 of the Agreement.
56
<PAGE>
(b) On each Distribution Date, the Paying Agent shall distribute
(in accordance with the certificate delivered by the Servicer to the
Trustee pursuant to subsection 3.04(b) of the Agreement) to each Class B
Certificateholder of record on the preceding Record Date (other than as
provided in subsection 2.04(e) or in Section 12.03 of the Agreement
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 subsection 4.09(h) and Section 4.10 of the Agreement by check
mailed to each Class B Certificateholder at such Certificateholder's
address as it appears on the Certificate Register or, in the case of Class
B Certificateholders holding Class B Certificates evidencing Undivided
Interests aggregating not less than 80% of the Class B Invested Amount, by
wire transfer, at the expense of such Class B Certificateholder, to an
account or accounts designated by such Class B Certificateholder by written
notice given to the Paying Agent not less than five days prior to the
related Distribution Date; provided, however, that the final payment in
-------- -------
retirement of the Class B Certificates will be made only upon presentation
and surrender of the Class B Certificates at the office or offices
specified in the notice of such final distribution delivered by the Trustee
pursuant to Section 12.03 of the Agreement.
(c) On each Distribution Date, the Paying Agent shall distribute
(in accordance with the certificate delivered by the Servicer to the
Trustee pursuant to subsection 3.04(b) of the Agreement) to each CIA
Certificateholder of record on the preceding Record Date (other than as
provided in subsection 2.04(e) or in Section 12.03 of the Agreement
respecting a final distribution) such Certificateholder's pro rata share
--- ----
(based on the aggregate Undivided Interests represented by CIA Certificates
held by such Certificateholder) of amounts on deposit in the Distribution
Account as are payable to the CIA Certificateholders pursuant to subsection
4.09(h) and Section 4.10 and subsection 4.13(f) of the Agreement by wire
transfer, at the expense of such CIA Certificateholder, to an account or
accounts designated by such CIA Certificateholder by written notice given
to the Paying Agent not less than five days prior to the related
Distribution Date; provided, however, that the final payment in retirement
-------- -------
of the CIA Certificates will be made only
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upon presentation and surrender of the CIA Certificates at the office or
offices specified in the notice of such final distribution delivered by the
Trustee pursuant to Section 12.03 of the Agreement.
Section 5.02 Monthly Certificateholders' Statement.
-------------------------------------
(a) On each Distribution Date, the Paying Agent shall forward to
each Certificateholder and each Rating Agency a statement substantially in
the form of Exhibit F prepared by the Servicer and delivered to the Trustee
and the Paying Agent on the preceding Determination Date setting forth the
following information (which, in the case of (i), (ii) and (iii) below,
shall be stated on the basis of an original principal amount of $1,000 per
Certificate):
(i) the total amount distributed;
(ii) the amount of such distribution allocable to
Certificate Interest;
(iii) the amount of such distribution allocable to
Certificate Principal;
(iv) 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 CIA
Certificates, respectively;
(v) 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 CIA
Certificates, respectively, and the amount of Principal Funding
Investment Proceeds and investment earnings on amounts on deposit in
the Reserve Account;
(vi) the aggregate amount of Principal Receivables, the
Invested Amount, the Class A Invested Amount, the Class B Invested
Amount, the CIA Invested Amount, the Floating Allocation Percentage
and, during the Amortization Period, the Fixed/Floating Allocation
Percentage with respect to the Principal Receivables in the Trust as
of the end of the day on the Record Date;
58
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(vii) the aggregate outstanding balance of Accounts which
are 35, 65, 95, 125, 155 and 185 or more days Contractually
Delinquent as of the end of the day on the Record Date;
(viii) the aggregate Investor Default Amount, the Class A
Investor Default Amount, the Class B Investor Default Amount and the
CIA Investor Default Amount for the related Monthly Period;
(ix) the aggregate amount of Class A Investor Charge Offs,
and the amount by which the Class B Invested Amount and the CIA
Invested Amount have been reduced with respect to the related Monthly
Period;
(x) the aggregate amount of Class A Investor Charge Offs
reimbursed and the amount by which reductions of the Class B Invested
Amount and the CIA Invested Amount have been reimbursed on the
Transfer Date immediately preceding such Distribution Date;
(xi) the amount of the Class A Monthly Servicing Fee, the
Class B Monthly Servicing Fee and the CIA Monthly Servicing Fee for
the related Monthly Period;
(xii) the amount of Reallocated CIA Principal Collections
and Reallocated Class B Principal Collections with respect to such
Distribution Date;
(xiii) the CIA Invested Amount and the Required CIA
Invested Amount as of the close of business on such Distribution Date;
(xiv) the Class A Pool Factor and the Class B Pool Factor
as of the end of the last day of the related Monthly Period;
(xv) the Portfolio Yield for the related Monthly Period;
(xvi) the Base Rate for the related Monthly Period;
(xvii) the Principal Funding Account Balance on the related
Transfer Date;
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(xviii) the Accumulation Shortfall;
(xix) the Accumulation Period Commencement Date and the
Accumulation Period Length; and
(xx) the Principal Funding Investment Shortfall, the
Required Reserve Account Amount, the Reserve Account Balance and the
Reserve Draw Amount for such Monthly Period.
(b) Annual Certificateholders' Tax Statement. On or before
----------------------------------------
January 31 of each calendar year, beginning with calendar year 1997, the
Trustee shall distribute to each Person who at any time during the
preceding calendar year was a Series 1996-2 Certificateholder, a statement
prepared by the Servicer containing the information required to be
contained in the regular monthly report to Series 1996-2
Certificateholders, as set forth in subclauses (i), (ii) and (iii) above,
aggregated for such calendar year or the applicable portion thereof during
which such Person was a Series 1996-2 Certificateholder, together with such
other customary information (consistent with the treatment of the
Certificates as debt) as the Trustee or the Servicer deems necessary or
desirable to enable the Series 1996-2 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 Code as from
time to time in effect.
Section 5.03 Rule 144A Information. So long as any of the CIA
---------------------
Certificates are "restricted securities" within the meaning of Rule
144(a)(3) under the Securities Act and during any period in which the Trust
is not subject to Section 13 or 15(d) of the Exchange Act, the Transferor
agrees to make available to any QIB or beneficial owner of the CIA
Certificates in connection with any sale thereof and any prospective
purchaser of such CIA Certificates from such QIB or beneficial owner, the
information required by Rule 144A(d)(4) under the Securities Act.
SECTION 8. Series 1996-2 Pay Out Events. If any one of the
----------------------------
following events shall occur with respect to the Series 1996-2
Certificates:
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(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 1996-2
Certificateholders 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 Series 1996-2
Certificates evidencing Undivided Interests aggregating not less than 50%
of the Invested Amount of this Series 1996-2, and continues to affect
materially and adversely the interests of the Series 1996-2
Certificateholders 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 2.01 or 2.06 of the Agreement, (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 the Series 1996-2
Certificates evidencing Undivided Interests aggregating more than 50% of
the Invested Amount of this Series 1996-2, and (ii) as a result of which
the interests of the Series 1996-2 Certificateholders are materially and
adversely affected and continue to be materially and adversely affected for
such period; provided, however, that a Series 1996-2 Pay Out Event pursuant
-------- -------
to this subsection 9(b) shall not be deemed to have occurred hereunder if
the Transferor has accepted reassignment of the related Receivable, or all
of such Receivables, if applicable, during such period in accordance with
the provisions of the Agreement;
(c) the average Portfolio Yield for any three consecutive Monthly
Periods is less than the average Base Rate for such three consecutive
Monthly Periods;
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(d) the Transferor shall fail to convey Receivables arising under
Additional Accounts to the Trust, as required by subsection 2.06(a) of the
Agreement; or
(e) any Servicer Default shall occur which would have a material
adverse effect on the Series 1996-2 Certificateholders.
then, in the case of any event described in subparagraph (a), (b) or (e),
after the applicable grace period set forth in such subparagraphs, either
the Trustee or the Holders of Series 1996-2 Certificates evidencing
Undivided Interests aggregating more than 50% of the Invested Amount of
this Series 1996-2 by notice then given in writing to the Transferor and
the Servicer (and to the Trustee if given by the Certificateholders) may
declare that a pay out event (a "Series 1996-2 Pay Out Event") has occurred
---------------------------
as of the date of such notice, and in the case of any event described in
subparagraphs (c) or (d), a Series 1996-2 Pay Out Event shall occur without
any notice or other action on the part of the Trustee or the Series 1996-2
Certificateholders immediately upon the occurrence of such event.
SECTION 9. Series 1996-2 Termination. The right of the Series
-------------------------
1996-2 Certificateholders to receive payments from the Trust will terminate
on the first Business Day following the Series 1996-2 Termination Date.
SECTION 10. Periodic Finance Charges and Other Fees. The
---------------------------------------
Transferor hereby agrees that, except as otherwise required by any
Requirement of Law, or as is deemed by the Transferor to be necessary in
order for the Transferor to maintain its credit card business, based upon a
good faith assessment by the Transferor, in its sole discretion, of the
nature of the competition in the credit card business, it shall not at any
time reduce the Periodic Finance Charges assessed on any Receivable or
other fees on any Account if, as a result of such reduction, the
Transferor's reasonable expectation of the Portfolio Yield as of such date
would be less than the Base Rate.
SECTION 11. Transfers of CIA Certificates; Legends. (a) No CIA
--------------------------------------
Certificate or any interest therein may be sold (including in the initial
offering), conveyed, assigned, hypothecated, pledged, participated, or
62
<PAGE>
otherwise transferred (each, a "Transfer") except in accordance with this
--------
Section 11. Any Transfer of a CIA Certificate otherwise permitted by this
Section 11 will be permitted only if it consists of a pro rata percentage
interest in all payments made with respect to such Holder's CIA
Certificates and no Transfers of partial interests in a CIA Certificate
shall be permitted. No CIA Certificate or any interest therein may be
Transferred to any Person (each, an "Assignee"), unless the Assignee shall
--------
have executed and delivered the certification referred to in subsection
11(e) below and each of the Transferor and the Servicer shall have granted
its prior consent thereto. Such consent shall be granted unless the
Transferor determines in its sole and absolute discretion that such
Transfer would create a risk that the Trust would be classified for federal
or any applicable state tax purposes as an association or publicly traded
partnership taxable as a corporation; provided, further, that any attempted
-------- -------
Transfer that would cause the number of Targeted Holders to exceed one
hundred shall be void; and provided, further, that there shall not at any
-------- -------
time be more than 10 CIA Certificateholders or such other number as may be
consented to by the Transferor which consent may be withheld in its sole
and absolute discretion.
(b) Each initial purchaser of a CIA Certificate or any interest
therein and any Assignee thereof shall certify to the Transferor, the
Servicer, and the Trustee that it is either (A)(i) a citizen or resident of
the U.S., (ii) a corporation, partnership or other entity organized in or
under the laws of the U.S. or any political subdivision thereof which, if
such entity is a tax-exempt entity, recognizes that payments with respect
to the CIA Certificates may constitute unrelated business taxable income or
(iii) a person not described in (i) or (ii) whose ownership of the CIA
Certificates is effectively connected with the conduct of a trade or
business within the United States (within the meaning of the Code) and
whose ownership of any interest in a CIA Certificate will not result in any
withholding obligation with respect to any payments with respect to the CIA
Certificates by any person and who will furnish to the Certificateholder
making the Transfer, the Servicer and the Trustee, a properly executed U.S.
Internal Revenue Service Form 4224 (and to agree to provide a new Form 4224
upon the expiration or obsolescence of any previously delivered form and
comparable statements in accordance with applicable U.S. laws) or (B) an
estate or trust the
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<PAGE>
income of which is includible in gross income for U.S. federal income tax
purposes.
(c) Each initial purchaser of a CIA Certificate or any interest
therein and any Assignee thereof shall further certify to the Transferor,
the Servicer and the Trustee that it has neither acquired nor will it sell,
trade or transfer any interest in a CIA Certificate or cause an interest in
a CIA Certificate to be marketed on or through (i) an "established
securities market" within the meaning of Section 7704(b)(1) of the Code and
any treasury regulation thereunder, including, without limitation, an over-
the-counter-market or an interdealer quotation system that regularly
disseminates firm buy or sell quotations or (ii) a "secondary market"
within the meaning of Section 7704(b)(2) of the Code and any treasury
regulation thereunder, including a market wherein interests in the CIA
Certificates are regularly quoted by any Person making a market in such
interests and a market wherein any Person regularly makes available bid or
offer quotes with respect to interests in the CIA Certificates and stands
ready to effect buy or sell transactions at the quoted prices for itself or
on behalf of others. In addition, each initial purchaser of a CIA
Certificate or any interest therein and any Assignee shall certify, prior
to any delivery or Transfer to it of a CIA Certificate that it is not and
will not become a partnership, Subchapter S corporation or grantor trust
for U.S. federal income tax purposes. If an initial purchaser of an
interest in a CIA Certificate or an Assignee cannot make the certification
described in the preceding sentence, the Transferor may, in its sole
discretion, prohibit a Transfer to such entity; provided, however, that if
the Transferor agrees to permit such a Transfer, the Transferor, the
Servicer or the Trustee may require additional certifications in order to
prevent the Trust from being treated as a publicly traded partnership.
Each initial purchaser of an interest in a CIA Certificate and Assignee
acknowledges that the Opinion of Counsel to the effect that the Trust will
not be treated as a publicly traded partnership taxable as a corporation is
dependent in part on the accuracy of the certifications described in this
subsection 11(c).
(d) Each CIA Certificate will bear a legend or legends
substantially in the following form:
EACH PURCHASER REPRESENTS AND WARRANTS FOR THE BENEFIT OF
FIRST USA BANK AND THE TRUSTEE
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THAT SUCH PURCHASER IS NOT (I) AN EMPLOYEE BENEFIT PLAN (AS DEFINED IN
SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS
AMENDED ("ERISA")) THAT IS SUBJECT TO THE PROVISIONS OF TITLE I OF ERISA,
(II) A PLAN DESCRIBED IN SECTION 4975(E)(1) OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED, (III) A GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32) OF
ERISA, SUBJECT TO ANY FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL
EXTENT, SIMILAR TO THE PROVISIONS OF SECTION 406 OF ERISA OR SECTION 4975
OF THE CODE, (IV) AN ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY
REASON OF A PLAN'S INVESTMENT IN THE ENTITY OR (V) A PERSON INVESTING "PLAN
ASSETS" OF ANY SUCH PLAN (EXCLUDING FOR PURPOSES OF THIS CLAUSE(V), ANY
ENTITY REGISTERED UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED);
PROVIDED, HOWEVER, THAT A PURCHASER SHALL NOT BE REQUIRED TO MAKE THE
REPRESENTATIONS AND WARRANTIES SET FORTH IN CLAUSE (IV) OR (V) ABOVE IF THE
TRUSTEE SHALL HAVE RECEIVED THE PRIOR WRITTEN CONSENT OF THE TRANSFEROR TO
THE TRANSFER TO SUCH ENTITY.
THIS CERTIFICATE MAY NOT BE ACQUIRED, SOLD, TRADED OR
TRANSFERRED, NOR MAY AN INTEREST IN THIS CERTIFICATE BE MARKETED, ON OR
THROUGH (I) AN "ESTABLISHED SECURITIES MARKET" WITHIN THE MEANING OF
SECTION 7704(b)(1) OF THE CODE AND ANY PROPOSED, TEMPORARY OR FINAL
TREASURY REGULATION THEREUNDER, INCLUDING, WITHOUT LIMITATION, AN OVER-THE-
COUNTER-MARKET OR AN INTERDEALER QUOTATION SYSTEM THAT REGULARLY
DISSEMINATES FIRM BUY OR SELL QUOTATIONS OR (II) A "SECONDARY MARKET"
WITHIN THE MEANING OF SECTION 7704(b)(2) OF THE CODE AND ANY PROPOSED,
TEMPORARY OR FINAL TREASURY REGULATION THEREUNDER, INCLUDING A MARKET
WHEREIN INTERESTS IN THE CIA CERTIFICATES ARE REGULARLY QUOTED BY ANY
PERSON MAKING A MARKET IN SUCH INTERESTS AND A MARKET WHEREIN ANY PERSON
REGULARLY MAKES AVAILABLE BID OR OFFER QUOTES WITH RESPECT TO INTERESTS IN
THE CIA CERTIFICATES AND STANDS READY TO EFFECT BUY OR SELL TRANSACTIONS AT
THE QUOTED PRICES FOR ITSELF OR ON BEHALF OF OTHERS.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY
STATE SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE,
AGREES THAT THIS CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE
LAWS AND ONLY (1) TO THE TRANSFEROR, (2) TO A LIMITED NUMBER OF
INSTITUTIONAL "ACCREDITED INVESTORS" (AS DEFINED IN
65
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RULE 501(a)(1), (2), (3) OR (7) UNDER THE SECURITIES ACT) AND IN A
TRANSACTION EXEMPT FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
(UPON DELIVERY OF THE DOCUMENTATION REQUIRED BY THE POOLING AND SERVICING
AGREEMENT AND, IF THE TRUSTEE SO REQUIRES, AN OPINION OF COUNSEL
SATISFACTORY TO THE TRUSTEE) OR (3) PURSUANT TO RULE 144A UNDER THE
SECURITIES ACT TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A ("QIB")
PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR THE ACCOUNT OF A
QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE,
PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A. EACH
CERTIFICATE OWNER BY ACCEPTING A BENEFICIAL INTEREST IN THIS CERTIFICATE IS
DEEMED TO REPRESENT THAT IT IS EITHER A QIB PURCHASING FOR ITS OWN ACCOUNT,
A QIB PURCHASING FOR THE ACCOUNT OF ANOTHER QIB OR AN INSTITUTIONAL
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) OR (7) UNDER
THE SECURITIES ACT). THIS CERTIFICATE WILL NOT BE ACCEPTED FOR
REGISTRATION OF TRANSFER EXCEPT UPON PRESENTATION OF EVIDENCE SATISFACTORY
TO THE TRANSFER AGENT AND REGISTRAR THAT THE RESTRICTIONS ON TRANSFER SET
FORTH IN THE SERIES 1996-2 SUPPLEMENT HAVE BEEN COMPLIED WITH. THIS
CERTIFICATE MAY NOT BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED
WITHOUT THE PRIOR WRITTEN CONSENT OF EACH OF THE TRANSFEROR AND THE
SERVICER AND UNLESS AND UNTIL THE TRUSTEE SHALL HAVE RECEIVED THE
CERTIFICATIONS REQUIRED BY THE SERIES 1996-2 SUPPLEMENT.
(e) Upon surrender for registration of transfer of a CIA
Certificate at the office of the Transfer Agent and Registrar, accompanied
by a certification by the CIA Certificateholder substantially in the form
attached as Exhibit G, executed by the registered owner, in person or by
such CIA Certificateholder's attorney thereunto duly authorized in writing,
and receipt by the Trustee of the written consent of each of the Transferor
and the Servicer to such transfer, such CIA Certificate shall be
transferred upon the Certificate Register, and the Transferor shall
execute, and the Trustee shall authenticate and deliver, in the name of the
designated transferees one or more new registered CIA Certificates of any
authorized denominations and of a like aggregate principal amount and
tenor. Such transfers of CIA Certificates shall be subject to the
restrictions set forth in this Section 11, to such other restrictions as
shall be set forth in the text of the CIA Certificates and to such
reasonable regulations as may be prescribed by the Transferor. Successive
registrations and registrations
66
<PAGE>
of transfers as aforesaid may be made from time to time as desired, and
each such registration shall be noted on the Certificate Register.
(f) No CIA Certificate or any interest therein may be Transferred
(including in the initial offering) to any Person that is an entity whose
underlying assets include plan assets by reason of a plan's investment in
the entity or a person investing "plan assets" of any such plan (excluding
any entity registered under the Investment Company Act) (each such Person,
a "Plan Purchaser"), unless the Assignee shall have executed and delivered
--------------
the certification referred to in subsection 11(e) above and each of the
Transferor and the Servicer shall have granted its prior written consent
thereto. No such consent shall be granted if the Transferor determines in
its sole and absolute discretion that such Transfer would cause the
aggregate percentage of the CIA Invested Amount Transferred to Plan
Purchasers to exceed 25% of the CIA Invested Amount; provided, further,
-------- -------
that any attempted Transfer that would cause the percentage of the CIA
Invested Amount Transferred to Plan Purchasers to exceed 25% of the CIA
Invested Amount shall be void.
SECTION 12. Compliance with Withholding Requirements.
----------------------------------------
Notwithstanding any other provision of the Agreement, the Trustee and any
Paying Agent shall comply with all Federal withholding requirements with
respect to payments to the CIA Certificateholders of interest, original
issue discount, or other amounts that the Trustee, any Paying Agent, the
Servicer or the Transferor reasonably believes are applicable under the
Code. The consent of the CIA Certificateholders shall not be required for
any such withholding. In the event the Trustee or the Paying Agent
withholds any amount from payments made to any CIA Certificateholder
pursuant to federal withholding requirements, the Trustee or the Paying
Agent shall indicate to such CIA Certificateholder the amount withheld and
all such amounts shall be deemed to have been paid to such CIA
Certificateholders and the CIA Certificateholders shall have no claim
therefor.
SECTION 13. Tax Characterization of the CIA Certificates. It is
--------------------------------------------
the intention of the parties hereto that the CIA Certificates be treated
for tax purposes as indebtedness. In the event that the CIA Certificates
are not so treated, it is the intention of the parties that the CIA
Certificates be treated as an interest in a
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partnership that owns the Receivables. In the event that the CIA
Certificates are treated as an interest in a partnership, it is the
intention of the parties that interest payable on the CIA Certificates be
treated as guaranteed payment and, if for any reason it is not so treated,
that the holders of the CIA Certificates be specially allocated gross
interest income equal to the interest accrued during each Interest Accrual
Period on the CIA Certificates.
SECTION 14. ERISA Legend. Each Class B Certificate will bear a
------------
legend or legends substantially in the following form:
EACH PURCHASER REPRESENTS AND WARRANTS FOR THE BENEFIT OF FIRST
USA BANK AND THE TRUSTEE THAT SUCH PURCHASER IS NOT (I) AN EMPLOYEE BENEFIT
PLAN (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA")) THAT IS SUBJECT TO THE PROVISIONS OF
TITLE I OF ERISA, (II) A PLAN DESCRIBED IN SECTION 4975(E)(1) OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED, (III) A GOVERNMENTAL PLAN, AS
DEFINED IN SECTION 3(32) OF ERISA, SUBJECT TO ANY FEDERAL, STATE OR LOCAL
LAW WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE PROVISIONS OF SECTION
406 OF ERISA OR SECTION 4975 OF THE CODE, (IV) AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE PLAN ASSETS BY REASON OF A PLAN'S INVESTMENT IN THE ENTITY
OR (V) A PERSON INVESTING "PLAN ASSETS" OF ANY SUCH PLAN (EXCLUDING FOR
PURPOSES OF THIS CLAUSE (V), ANY ENTITY REGISTERED UNDER THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED).
Each Certificate Owner by virtue of its beneficial interest in
the Class B Certificates shall be deemed to have made the representations
and warranties stated in such legend.
SECTION 15. Amendment and Ratification of Agreement. As
---------------------------------------
supplemented by this Series Supplement, the Agreement is in all respects
ratified and confirmed and the Agreement as so supplemented by this Series
Supplement shall be read, taken, and construed as one and the same
instrument. Subsection 12.01(c) of the Agreement is hereby amended by
substituting in the second sentence thereof in place of the words "and pay
the proceeds to all Certificateholders of such Series . . ." the following:
"and pay the proceeds to the Investor Certificateholders of such
Series . . ."
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SECTION 16. 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 17. GOVERNING LAW. THIS SERIES SUPPLEMENT SHALL BE
-------------
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT
REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.
SECTION 18. Additional Representations and Warranties of the
------------------------------------------------
Servicer. First USA Bank, as initial Servicer, hereby makes, and any
--------
Successor Servicer by its appointment under the Agreement shall make the
following representations and warranties:
(a) All Consents. All authorizations, consents, orders or
------------
approvals of or registrations or declarations with any Governmental
Authority required to be obtained, effected or given by the Servicer in
connection with the execution and delivery of this Supplement by the
Servicer and the performance of the transactions contemplated by this
Supplement by the Servicer, have been duly obtained, effected or given and
are in full force and effect.
(b) Rescission or Cancellation. The Servicer shall not permit
--------------------------
any rescission or cancellation of any Receivable except as ordered by a
court of competent jurisdiction or other Governmental Authority or in
accordance with the normal operating procedures of the Servicer.
(c) Receivables Not To Be Evidenced by Promissory Notes. Except
---------------------------------------------------
in connection with its enforcement or collection of an Account, the
Servicer will take no action to cause any Receivable to be evidenced by an
instrument or chattel paper (as defined in the UCC as in effect in the
State of Delaware).
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IN WITNESS WHEREOF, the Transferor, the Servicer and the Trustee
have caused this Series 1996-2 Supplement to be duly executed by their
respective officers as of the day and year first above written.
FIRST USA BANK,
Transferor and Servicer
By: /s/Steven L. McDonald
----------------------------
Name: Steven L. McDonald
Title: Senior Vice President
THE BANK OF NEW YORK (DELAWARE),
Trustee
By: /s/Melissa J. Beneduce
---------------------------
Name: Melissa J. Beneduce
Title: Asst. Vice President
<PAGE>
EXHIBIT A
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE
OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
EACH PURCHASER REPRESENTS AND WARRANTS FOR THE BENEFIT OF FIRST
USA BANK AND THE TRUSTEE THAT SUCH PURCHASER IS NOT (I) AN EMPLOYEE BENEFIT
PLAN (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA")) THAT IS SUBJECT TO THE PROVISIONS OF
TITLE I OF ERISA, (II) A PLAN DESCRIBED IN SECTION 4975(E)(1) OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED, (III) A GOVERNMENTAL PLAN, AS
DEFINED IN SECTION 3(32) OF ERISA, SUBJECT TO ANY FEDERAL, STATE OR LOCAL
LAW WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE PROVISIONS OF SECTION
406 OF ERISA OR SECTION 4975 OF THE CODE, (IV) AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE PLAN ASSETS BY REASON OF A PLAN'S INVESTMENT IN THE ENTITY
OR (V) A PERSON INVESTING "PLAN ASSETS" OF ANY SUCH PLAN (EXCLUDING FOR
PURPOSES OF THIS CLAUSE (V), ANY ENTITY REGISTERED UNDER THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED).
No. R-1 $__________
Series Termination
Date: February 10, 2006 CUSIP NO. 337435BJ9
FIRST USA CREDIT CARD MASTER TRUST CLASS A FLOATING RATE
ASSET BACKED CERTIFICATE, SERIES 1996-2
Evidencing an undivided interest in a trust, the corpus of which consists
of receivables generated from time to time in the ordinary course of
business in a portfolio of VISA(R) and
<PAGE>
MasterCard(R)* credit card accounts generated or to be generated by
First USA Bank (the "Bank").
(Not an interest in or a recourse obligation
of First USA Bank or any affiliate thereof)
This certifies that CEDE & CO. (the "Certificateholder") is the
registered owner of a fractional undivided interest in the First USA Credit
Card Master Trust (the "Trust") issued pursuant to the Pooling and
Servicing Agreement, dated as of September 1, 1992 between the Bank, as
Transferor (the "Transferor") and as Servicer (the "Servicer"), and The
Bank of New York (Delaware) (as successor to The Bank of New York as
successor to NationsBank, N.A.), as trustee (the "Trustee") of the Trust
(the "Agreement"; such term to include any Supplement or amendment thereto)
as amended by Assignment No. 17 of Receivables in Additional Accounts dated
as of June 4, 1996 among the Bank, as Transferor and Servicer, the Trustee
and The Bank of New York (Delaware) (as successor to The Bank of New York
as successor to NationsBank, N.A.), as trustee of the First USA Credit Card
Master Trust II, and as supplemented by the Series 1996-2 Supplement (the
"Series 1996-2 Supplement"), dated as of June 4, 1996, between the Bank, as
Transferor and Servicer, and the Trustee. The corpus of the Trust consists
of all of the Transferor's right, title and interest in a portfolio of
receivables (the "Receivables") existing in certain VISA(R) and
MasterCard(R) revolving credit card accounts identified in the Agreement
from time to time (the "Accounts"), all Receivables generated under the
Accounts from time to time thereafter, all monies due or to become due
(other than recoveries on charged-off Receivables) and all amounts received
with respect to the Receivables in existence in the Accounts, all monies on
deposit in certain bank accounts (excluding any investment earnings on such
deposited amounts except as set forth in the Series 1996-2 Supplement), and
all other assets and interests constituting the Trust and all proceeds of
the foregoing. The Receivables consist of amounts charged by cardholders
for goods and services and cash advances (such amounts, less the amount of
Discount Receivables, the "Principal Receivables"), plus the related
periodic finance charges (the
--------------------
* VISA(R) and MasterCard(R) are registered trademarks of Visa
USA Incorporated and MasterCard International Incorporated,
respectively.
<PAGE>
"Periodic Finance Charges"), annual membership fees ("Annual Membership
Fees"), and amounts charged to the Accounts in respect of cash advance
finance charges, late fees, overlimit fees, return check fees and similar
fees and charges (the "Other Charges"). Receivables in an amount equal to
the product of the Yield Factor (initially 1.3%) and amounts charged by
cardholders for goods and services and cash advances (the "Discount
Receivables") will be allocated to the Certificates and treated as Finance
Charge Receivables (Discount Receivables, together with the Periodic
Finance Charges, Annual Membership Fees and Other Charges, the "Finance
Charge Receivables").
Although a summary of certain provisions of the Agreement is set
forth below, this Class A Certificate does not purport to summarize the
Agreement and reference is made to the Agreement for information with
respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the
Trustee. A copy of the Agreement may be requested from the Trustee by
writing to the Trustee at The Bank of New York (Delaware), White Clay
Center, Route 273, Newark, Delaware, 19711, Attention: Bond
Administration. To the extent not defined herein, the capitalized terms
used herein have the meanings ascribed to them in the Agreement. This
Certificate is one of a Series of Certificates entitled "First USA Credit
Card Master Trust Class A Floating Rate Asset Backed Certificates, Series
1996-2" (the "Class A Certificates"), each of which represents a fractional
undivided interest in the Trust, and is issued under and is subject to the
terms, provisions and conditions of the Agreement, to which Agreement, as
amended from time to time, the Certificateholder by virtue of the
acceptance hereof assents and by which the Certificateholder is bound. In
the case of any conflict between terms specified in this Class A
Certificate and terms specified in the Agreement, the terms of the
Agreement shall govern.
The Transferor has structured the Agreement, the Class A
Certificates and the First USA Credit Card Master Trust Class B Floating
Rate Asset Backed Certificates, Series 1996-2 (the "Class B Certificates")
with the intention that the Class A Certificates and Class B Certificates
will qualify under applicable tax law as indebtedness, and the Transferor
and each holder of a Class A Certificate (a "Class A Certificateholder") or
any interest therein, by acceptance of its Class A Certificate or any
interest there-
<PAGE>
in, agrees to treat the Class A Certificates for purposes of federal,
state, local and foreign income or franchise taxes and any other tax
imposed on or measured by income, as indebtedness.
The Trust's assets are allocated in part to the holders of the
Class A Certificates, the holders of the Class B Certificates and the
holders of the First USA Credit Card Master Trust CIA Certificates, Series
1996-2 (the "CIA Certificates") (such holders together the "Investor
Certificateholders") with the remainder allocated to holders of other
Series of Certificates issued by the Trust, if any, and to the Transferor.
In addition to the Class A Certificates, the Class B Certificates and the
CIA Certificates, the Exchangeable Transferor Certificate will be reissued
pursuant to the Agreement and will represent the Transferor's interest in
the Trust. The reissued Exchangeable Transferor Certificate will represent
the interest in the Principal Receivables not represented by the Class A
Certificates, the Class B Certificates and the CIA Certificates (together
the "Investor Certificates") or any other Series of Certificates. The
Exchangeable Transferor Certificate may be exchanged by the Transferor
pursuant to the Agreement for one or more Series of Certificates and a
reissued Exchangeable Transferor Certificate upon the conditions set forth
in the Agreement. In addition, to the extent permitted for any Series of
Certificates by the related Supplement, the Certificateholders of such
Series may tender their Certificates and the Transferor may tender the
Exchangeable Transferor Certificate in exchange for one or more Series of
Certificates and a reissued Exchangeable Transferor Certificate.
The Class A Initial Invested Amount is $600,000,000. The Class A
Invested Amount for any monthly Distribution Date will be an amount equal
to $600,000,000 minus the aggregate amount of principal payments made to
-----
the Class A Certificateholders prior to such Distribution Date and minus
-----
the excess, if any, of the aggregate amount of Class A Investor Charge-Offs
over the Class A Investor Charge-Offs reimbursed prior to such date.
The Class A Certificates will bear interest at the rate of
5.6175% per annum on the Class A Initial Invested Amount from June 4, 1996
through July 9, 1996, and for each Interest Period thereafter, the Class A
Certificates will bear interest at a per annum rate of 0.18% in excess of
<PAGE>
LIBOR as determined by the Trustee on the related LIBOR Determination Date
(each such rate as in effect from time to time, the "Class A Certificate
Rate"). Interest will be distributed to the extent of available funds on
July 10, 1996, and on the tenth day of each month thereafter, or if such
day is not a Business Day, the next succeeding Business Day until the
earlier of the day on which the Class A Invested Amount is paid in full and
the Series Termination Date (each such date a "Distribution Date"), in an
amount equal to the product of (a) the actual number of days in the related
Interest Period divided by 360, (b) the Class A Certificate Rate and (c)
the Class A Outstanding Principal Balance on the last day of the Monthly
Period immediately preceding such Distribution Date. Interest for a
Distribution Date will accrue from and including the previous Distribution
Date (or in the case of the first Distribution Date, from and including the
Closing Date), to, and including, the day immediately preceding the current
Distribution Date. Interest payments will be made from Collections of
Finance Charge Receivables and certain other amounts allocated to the Class
A Certificates comprising Class A Available Funds and, in certain
circumstances, from Reallocated Principal Collections on July 10, 1996 and
on each Distribution Date thereafter until the Series 1996-2 Termination
Date. Interest will be payable monthly on each Distribution Date to the
Class A Certificateholders of record as of the related Record Date. The
Record Date with respect to any Distribution Date shall be the last day of
the calendar month preceding such Distribution Date.
If on any Distribution Date the Class A Available Funds are
insufficient to cover the Class A Monthly Interest and any overdue Class A
Monthly Interest due on such Distribution Date, Class A Default Interest,
if any, for such Distribution Date, any overdue Class A Default Interest,
the Class A Investor Default Amount for such Distribution Date and, if the
Bank is no longer the Servicer, the Class A Monthly Servicing Fee for such
Distribution Date (such deficiency the "Class A Required Amount"), Excess
Finance Charge Collections will be applied to fund the Class A Required
Amount. If Excess Finance Charge Collections are insufficient to fund the
Class A Required Amount, if any, an amount equal to the lesser of (x) the
CIA Invested Amount and (y) the product of (a)(i) during the Revolving
Period, the CIA Floating Allocation Percentage or (ii) during an
Amortization Period, the CIA Fixed/Floating Allocation Percentage and (b)
the amount of Collections of Principal
<PAGE>
Receivables with respect to the related Monthly Period (such amount as so
applied, "Reallocated CIA Principal Collections") will be applied to the
extent of any remaining Class A Required Amount.
If the Class A Required Amount for any Monthly Period exceeds
both the amount of available Excess Finance Charge Collections and the
amount of available Reallocated CIA Principal Collections for such Monthly
Period, then an amount equal to the lesser of (x) the Class B Invested
Amount and (y) the product of (a)(i) during the Revolving Period, the Class
B Floating Allocation Percentage or (ii) during an Amortization Period, the
Class B Fixed/Floating Allocation Percentage and (b) the amount of
Collections of Principal Receivables with respect to the related Monthly
Period (such amount as so applied, "Reallocated Class B Principal
Collections") will be applied to the extent of any remaining Class A
Required Amount.
On each Distribution Date the CIA Invested Amount will be reduced
by the amount of Reallocated CIA Principal Collections and by the amount of
Reallocated Class B Principal Collections for such Distribution Date. In
the event that such reduction would cause the CIA Invested Amount to be a
negative number, the CIA Invested Amount will be reduced to zero and the
Class B Invested Amount will be reduced by the amount by which the CIA
Invested Amount would have been reduced below zero. In the event that the
reallocation of Collections of Principal Receivables would cause the Class
B Invested Amount to be a negative number on any Distribution Date,
Collections of Principal Receivables will be reallocated on such
Distribution Date in an aggregate amount equal to the amount which would
cause the Class B Invested Amount to be reduced to zero.
The Bank, as Servicer, is entitled to receive as servicing
compensation a monthly servicing fee in an amount equal to, with respect to
each Series, one-twelfth of the product of the applicable Servicing Fee
Percentage and the Invested Amount for such Series with respect to the
related Monthly Period. The share of the Servicing Fee for each Monthly
Period allocable to the Class A Certificates shall be equal to one-twelfth
of the product of the Series Servicing Fee Percentage and the Class A
Adjusted Invested Amount on the last day of the preceding Monthly Period
(the "Class A Monthly Servicing Fee").
<PAGE>
As described in the Agreement, Collections of Principal
Receivables with respect to any Monthly Period will be allocated on the
related Determination Date on the basis of the aggregate Investor
Percentage of all Series and the Transferor Percentage with respect to the
Principal Receivables. Such allocation will be performed both during the
Revolving Period and any Amortization Period. Throughout the existence of
the Trust, the Servicer will allocate to the Transferor, as holder of the
Exchangeable Transferor Certificate, an amount equal to the Transferor
Percentage of the aggregate amount of Collections of Finance Charge
Receivables and Principal Receivables for each Monthly Period. During the
Revolving Period relating to the Investor Certificates, the Class B
Floating Allocation Percentage of Collections of Principal Receivables and
the CIA Floating Allocation Percentage of Collections of Principal
Receivables will be applied first as Reallocated Principal Collections, to
the extent required, and any remaining amounts together with the Class A
Floating Allocation Percentage of Principal Receivables will be distributed
first to the certificateholders of other Series to the extent of the amount
of Principal Shortfalls, if any, and then to the Transferor in an amount
not to exceed the amount of the Transferor Interest.
Unless a Pay Out Event has occurred, the Accumulation Period will
begin at the close of business on the last day of the Revolving Period and
will end on the earlier of (i) the commencement of the Rapid Amortization
Period, (ii) payment of the Invested Amount in full and (iii) the Series
Termination Date. During the Accumulation Period, prior to the payment of
the Invested Amount in full, amounts equal to the sum of (x) the least of
(a) Available Investor Principal Collections for the related Monthly
Period, (b) the sum of the applicable Controlled Accumulation Amount for
such Monthly Period and the applicable Accumulation Shortfall, if any (such
applicable sum, the "Controlled Deposit Amount") and (c) the Adjusted
Invested Amount on such Transfer Date plus (y) Excess Principal Collections
from other Series allocable to Series 1996-2 will be deposited monthly in
the Principal Funding Account on each Transfer Date beginning with the
Transfer Date in the month following the commencement of the Accumulation
Period until the Principal Funding Account Balance is equal to the Invested
Amount.
Upon written notice to the Trustee, the Servicer may elect to
postpone the commencement of the Accumulation Period, and extend the length
of the Revolving Period,
<PAGE>
subject to certain conditions as set forth in the Agreement. The Servicer
may make such election only if the Accumulation Period Length is less than
twelve months. On each Determination Date on and after the February 2002
Determination Date, until the Accumulation Period begins, the Servicer will
determine the "Accumulation Period Length," which is the number of months
expected to be required to fully fund the Principal Funding Account no
later than the Class A Scheduled Payment Date, based on (a) the expected
monthly collections of Principal Receivables expected to be distributable
to the Certificateholders of all Series (excluding certain other Series, as
set forth in the Agreement), assuming a principal payment rate no greater
than the lowest monthly principal payment rate on the Receivables for the
preceding twelve months and (b) the amount of principal expected to be
distributable to certificateholders of Series (which may exclude certain
other Series) which are not expected to be in their revolving periods
during the Accumulation Period. If the Accumulation Period Length is less
than twelve months, the Servicer may, at its option, postpone the
commencement of the Accumulation Period such that the number of months
included in the Accumulation Period will be equal to or exceed the
Accumulation Period Length. The length of the Accumulation Period shall
not be less than one month.
Unless the Rapid Amortization Period has begun, funds on deposit
in the Principal Funding Account will be distributed to the Class A
Certificateholders on the June 2003 Distribution Date (the "Class A
Scheduled Payment Date"). If the aggregate principal amount of deposits
made to the Principal Funding Account are insufficient to pay in full the
Class A Invested Amount on the Class A Scheduled Payment Date the Rapid
Amortization Period will commence and on each Distribution Date thereafter
until the Class A Invested Amount is paid in full, the Class A
Certificateholders will receive distributions of Class A Monthly Principal
and Class A Monthly Interest.
On the June 2003 Distribution Date if the Class A Invested Amount
is paid in full, Available Investor Principal Collections and Excess
Principal Collections allocable to Series 1996-2 will be used to pay the
Class B Invested Amount as described in the Agreement. If the Available
Investor Principal Collections and Excess Principal Collections allocable
to Series 1996-2 are insufficient to pay in full the Class B Invested
Amount on the June 2003 Distribution Date, the Rapid Amortization Period
will commence.
<PAGE>
If, for any Monthly Period, the Available Investor Principal
Collections for such Monthly Period exceed the applicable Controlled
Deposit Amount, any such excess will be treated as Excess Principal
Collections and allocated to the holders of other Series issued and
outstanding or, subject to certain limitations described in the Agreement,
paid to the holder of the Exchangeable Transferor Certificate. If, for any
Monthly Period, the Available Investor Principal Collections for such
Monthly Period and Excess Principal Collections allocable to Series 1996-2
are less than the applicable Controlled Deposit Amount, the amount of such
deficiency will be the applicable "Accumulation Shortfall" for the
succeeding Monthly Period.
If a Pay Out Event occurs during the Accumulation Period, the
Rapid Amortization Period will commence and any amount on deposit in the
Principal Funding Account will be distributed to the Class A
Certificateholders on the Distribution Date following the Monthly Period in
which the Rapid Amortization Period commences.
During the period beginning on the earlier of the day on which a
Pay Out Event occurs and the Class A Scheduled Payment Date if the Class A
Invested Amount and the Class B Invested Amount are not paid in full on
such date, and ending on the earlier of (i) the date on which the Class A
Invested Amount, the Class B Invested Amount and the CIA Invested Amount
have been paid in full and (ii) the Series Termination Date (the "Rapid
Amortization Period"), collections of Principal Receivables allocated to
the Invested Amount will no longer be paid to the holder of the
Exchangeable Transferor Certificate or to the holders of the certificates
of any other Series or, if the Accumulation Period has commenced, deposited
in the Principal Funding Account, but instead will be distributed to the
Class A Certificateholders and, following payment in full of the Class A
Invested Amount, to the Class B Certificateholders, and, following payment
in full of the Class B Invested Amount, to the CIA Certificateholders,
monthly on each Distribution Date beginning with the Distribution Date in
the month following the commencement of the Rapid Amortization Period.
Subject to the Agreement, payments of principal are limited to
the unpaid Class A Invested Amount of the Class A Certificates, which may
be less than the unpaid balance of the Class A Certificates pursuant to the
terms of the Agreement. All principal of and interest on the Class A
<PAGE>
Certificates is due and payable no later than February 10, 2006 (or if such
day is not a Business Day, the next succeeding Business Day) (the "Series
Termination Date"). After the Series Termination Date, neither the Trust
nor the Transferor will have any further obligation to distribute principal
or interest on the Class A Certificates. In the event that the Invested
Amount is greater than zero on the Series Termination Date, the Trustee
will sell or cause to be sold, to the extent necessary, an amount of
interests in the Receivables or certain of the Receivables up to 110% of
the sum of the Class A Invested Amount, the Class B Invested Amount and the
CIA Invested Amount at the close of business on such date (but not more
than the total amount of Receivables allocable to the Investor
Certificates), and shall pay the proceeds to the Class A Certificateholders
pro rata then to the Class B Certificateholders pro rata and then to the
CIA Certificateholders pro rata in final payment of the Investor
Certificates.
The transfer of this Certificate shall be registered in the
Certificate Register upon surrender of this Certificate for registration of
transfer at any office or agency maintained by the Transfer Agent and
Registrar accompanied by a written instrument of transfer in a form
satisfactory to the Trustee and the Transfer Agent and Registrar duly
executed by the Certificateholder or such Certificateholder's attorney 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.
As provided in the Agreement and subject to certain limitations
therein set forth, Class A Certificates are exchangeable for new Class A
Certificates evidencing like aggregate Undivided Interests, as requested by
the Class A Certificateholder surrendering such Class A Certificates. No
service charge may be imposed for any such exchange but the Transferor,
Servicer, or Transfer Agent and Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith.
The Transferor, the Servicer, the Trustee, the Paying Agent and
the Transfer Agent and Registrar, and any agent of any of them, may treat
the person in whose name this Certificate is registered as the owner hereof
for all purposes, and neither the Transferor, the Servicer, the
<PAGE>
Trustee, the Paying Agent and 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 Agreement.
The Agreement and any Supplement may be amended by the
Transferor, the Servicer and the Trustee, without the consent of
certificateholders of any Series then outstanding for any purpose, provided
--------
that (i) the Transferor shall deliver an opinion of counsel acceptable to
the Trustee to the effect that such amendment will not adversely affect in
any material respect the interest of such certificateholders, and (ii) such
amendment will not result in a withdrawal or reduction of the rating of any
outstanding Series.
The Agreement and the Series 1996-2 Supplement may be amended by
the Transferor, the Servicer and the Trustee with the consent of the
holders of certificates evidencing undivided interests aggregating not less
than 66-2/3% of the investor interests of all Series adversely affected,
for the purpose of adding any provisions to, changing in any manner or
eliminating any of the provisions of the Agreement or the Series 1996-2
Supplement or of modifying in any manner the rights of certificateholders
of any then outstanding Series. No such amendment, however, may (a) reduce
in any manner the amount of, or delay the timing of, distributions required
to be made on any such Series, (b) change the definition of or the manner
of calculating the interest of any certificateholder of such Series, or (c)
reduce the aforesaid percentage of undivided interests the holders of which
are required to consent to any such amendment, in each case without the
consent of all certificateholders of all Series adversely affected.
Promptly following the execution of any amendment to the Agreement, the
Trustee will furnish written notice of the substance of such amendment to
each Class A Certificateholder.
<PAGE>
Unless the certificate of authentication hereon has been executed
by or on behalf of the Trustee, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement, or be valid for any
purpose.
IN WITNESS WHEREOF, the Transferor has caused this Certificate to
be duly executed on this 4th day of June, 1996.
FIRST USA BANK
By:
-------------------------------------
Name: Steven L. McDonald
Title: Senior Vice President
CERTIFICATE OF AUTHENTICATION
This is one of the Class A Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
THE BANK OF NEW YORK,
as Authenticating Agent
Date: June 4, 1996
By:
-------------------------------------
Name:
Title:
<PAGE>
EXHIBIT B
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION
("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE
OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE &
CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR
OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL
INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
EACH PURCHASER REPRESENTS AND WARRANTS FOR THE BENEFIT OF FIRST
USA BANK AND THE TRUSTEE THAT SUCH PURCHASER IS NOT (I) AN EMPLOYEE BENEFIT
PLAN (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA")) THAT IS SUBJECT TO THE PROVISIONS OF
TITLE I OF ERISA, (II) A PLAN DESCRIBED IN SECTION 4975(E)(1) OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED, (III) A GOVERNMENTAL PLAN, AS
DEFINED IN SECTION 3(32) OF ERISA, SUBJECT TO ANY FEDERAL, STATE OR LOCAL
LAW WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE PROVISIONS OF SECTION
406 OF ERISA OR SECTION 4975 OF THE CODE, (IV) AN ENTITY WHOSE UNDERLYING
ASSETS INCLUDE PLAN ASSETS BY REASON OF A PLAN'S INVESTMENT IN THE ENTITY
OR (V) A PERSON INVESTING "PLAN ASSETS" OF ANY SUCH PLAN (EXCLUDING FOR
PURPOSES OF THIS CLAUSE (V), ANY ENTITY REGISTERED UNDER THE INVESTMENT
COMPANY ACT OF 1940, AS AMENDED).
No. R-1 $54,300,000
Series Termination
Date: February 10, 2006 CUSIP NO. 337435BK6
FIRST USA CREDIT CARD MASTER TRUST CLASS B FLOATING RATE
ASSET BACKED CERTIFICATE, SERIES 1996-2
Evidencing an undivided interest in a trust, the corpus of which consists
of receivables generated from time to time in the ordinary course of
business in a portfolio of VISA(R) and
<PAGE>
MasterCard(R)* credit card accounts generated or to be generated by
First USA Bank (the "Bank").
(Not an interest in or a recourse obligation
of First USA Bank or any affiliate thereof)
This certifies that CEDE & CO. (the "Certificateholder") is the
registered owner of a fractional undivided interest in the First USA Credit
Card Master Trust (the "Trust") issued pursuant to the Pooling and
Servicing Agreement, dated as of September 1, 1992 between the Bank, as
Transferor (the "Transferor") and as Servicer (the "Servicer"), and The
Bank of New York (Delaware) (as successor to The Bank of New York as
successor to NationsBank, N.A.), as trustee (the "Trustee") of the Trust
(the "Agreement"; such term to include any Supplement or amendment thereto)
as amended by Assignment No. 17 of Receivables in Additional Accounts dated
as of June 4, 1996 among the Bank, as Transferor and Servicer, the Trustee
and The Bank of New York (Delaware) (as successor to The Bank of New York
as successor to NationsBank, N.A.), as trustee of the First USA Credit Card
Master Trust II, and as supplemented by the Series 1996-2 Supplement (the
"Series 1996-2 Supplement"), dated as of June 4, 1996, between the Bank, as
Transferor and Servicer, and the Trustee. The corpus of the Trust consists
of all of the Transferor's right, title and interest in a portfolio of
receivables (the "Receivables") existing in certain VISA(R) and
MasterCard(R) revolving credit card accounts identified in the Agreement
from time to time (the "Accounts"), all Receivables generated under the
Accounts from time to time thereafter, all monies due or to become due
(other than recoveries on charged-off Receivables) and all amounts received
with respect to the Receivables in existence in the Accounts, all monies on
deposit in certain bank accounts (excluding any investment earnings on such
deposited amounts except as set forth in the Series 1996-2 Supplement), and
all other assets and interests constituting the Trust and all proceeds of
the foregoing. The Receivables consist of amounts charged by cardholders
for goods and services and cash advances (such amounts, less the amount of
Discount Receivables, the "Principal Receivables"), plus the related
periodic finance charges (the
----------------------------
* VISA(R) and MasterCard(R) are registered trademarks of Visa USA
Incorporated and MasterCard International Incorporated, respectively.
<PAGE>
"Periodic Finance Charges"), annual membership fees ("Annual Membership
Fees"), and amounts charged to the Accounts in respect of cash advance
finance charges, late fees, overlimit fees, return check fees and similar
fees and charges (the "Other Charges"). Receivables in an amount equal to
the product of the Yield Factor (initially 1.3%) and amounts charged by
cardholders for goods and services and cash advances (the "Discount
Receivables") will be allocated to the Certificates and treated as Finance
Charge Receivables (Discount Receivables, together with the Periodic
Finance Charges, Annual Membership Fees and Other Charges, the "Finance
Charge Receivables").
Although a summary of certain provisions of the Agreement is set
forth below, this Class B Certificate does not purport to summarize the
Agreement and reference is made to the Agreement for information with
respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the
Trustee. A copy of the Agreement may be requested from the Trustee by
writing to the Trustee at The Bank of New York (Delaware), White Clay
Center, Route 273, Newark, Delaware, 19711, Attention: Bond
Administration. To the extent not defined herein, the capitalized terms
used herein have the meanings ascribed to them in the Agreement. This
Certificate is one of a Series of Certificates entitled "First USA Credit
Card Master Trust Class B Floating Rate Asset Backed Certificates, Series
1996-2" (the "Class B Certificates"), each of which represents a fractional
undivided interest in the Trust, and is issued under and is subject to the
terms, provisions and conditions of the Agreement, to which Agreement, as
amended from time to time, the Certificateholder by virtue of the
acceptance hereof assents and by which the Certificateholder is bound. In
the case of any conflict between terms specified in this Class B
Certificate and terms specified in the Agreement, the terms of the
Agreement shall govern.
The Transferor has structured the Agreement, the Class B
Certificates and the First USA Credit Card Master Trust Class A Floating
Rate Asset Backed Certificates, Series 1996-2 (the "Class A Certificates")
with the intention that the Class A Certificates and Class B Certificates
will qualify under applicable tax law as indebtedness, and the Transferor
and each holder of a Class B Certificate (a "Class B Certificateholder") or
any interest therein, by acceptance of its Class B Certificate or any
interest there-
<PAGE>
in, agrees to treat the Class B Certificates for purposes of federal,
state, local and foreign income or franchise taxes and any other tax
imposed on or measured by income, as indebtedness.
The Trust's assets are allocated in part to the holders of the
Class A Certificates, the holders of the Class B Certificates and the
holders of the First USA Credit Card Master Trust CIA Certificates, Series
1996-2 (the "CIA Certificates") (such holders together the "Investor
Certificateholders") with the remainder allocated to holders of other
Series of Certificates issued by the Trust, if any, and to the Transferor.
In addition to the Class A Certificates, the Class B Certificates and the
CIA Certificates, the Exchangeable Transferor Certificate will be reissued
pursuant to the Agreement and will represent the Transferor's interest in
the Trust. The reissued Exchangeable Transferor Certificate will represent
the interest in the Principal Receivables not represented by the Class A
Certificates, the Class B Certificates and the CIA Certificates (together
the "Investor Certificates") or any other Series of Certificates. The
Exchangeable Transferor Certificate may be exchanged by the Transferor
pursuant to the Agreement for one or more Series of Certificates and a
reissued Exchangeable Transferor Certificate upon the conditions set forth
in the Agreement. In addition, to the extent permitted for any Series of
Certificates by the related Supplement, the Certificateholders of such
Series may tender their Certificates and the Transferor may tender the
Exchangeable Transferor Certificate in exchange for one or more Series of
Certificates and a reissued Exchangeable Transferor Certificate.
The Class B Initial Invested Amount is $54,300,000. The Class B
Invested Amount for any monthly Distribution Date will be an amount equal
to (i) $54,300,000 minus (ii) the aggregate amount of principal payments
-----
made to the Class B Certificateholders prior to such Distribution Date,
minus (iii) the aggregate amount of Class B Investor Charge-Offs for all
-----
prior Distribution Dates minus (iv) the aggregate amount of Reallocated
-----
Class B Principal Collections for which the CIA Invested Amount has not
been reduced for all prior Distribution Dates minus (v) an amount equal to
-----
the aggregate amount by which the Class B Invested Amount has been reduced
to fund the Class A Investor Default Amount on all prior Distribution Dates
as described in the Agreement and plus (vi) the aggregate amount of Excess
----
Finance
<PAGE>
Charge Collections and certain other amounts allocated and available for
purposes of reimbursing amounts deducted pursuant to clauses (iii), (iv)
and (v).
The Class B Certificates will bear interest at the rate of
5.7675% per annum on the Class B Initial Invested Amount from June 4, 1996
through July 9, 1996, and for each Interest Period thereafter, the Class B
Certificates will bear interest at a per annum rate of 0.33% in excess of
LIBOR as determined by the Trustee on the related LIBOR Determination Date
(each such rate as in effect from time to time, the "Class B Certificate
Rate"). Interest will be distributed to the extent of available funds on
July 10, 1996, and on the tenth day of each month thereafter, or if such
day is not a Business Day, the next succeeding Business Day until the
earlier of the day on which the Class B Invested Amount is paid in full and
the Series Termination Date (each such date a "Distribution Date"), in an
amount equal to the product of (a) the actual number of days in the related
Interest Period divided by 360, (b) the Class B Certificate Rate and (c)
the Class B Outstanding Principal Balance on the last day of the Monthly
Period immediately preceding such Distribution Date. Interest for a
Distribution Date will accrue from and including the previous Distribution
Date (or in the case of the first Distribution Date, from and including the
Closing Date), to, and including, the day immediately preceding the current
Distribution Date. Interest payments will be made from Collections of
Finance Charge Receivables and, in certain circumstances, from Reallocated
Principal Collections on July 10, 1996 and on each Distribution Date
thereafter until the Series 1996-2 Termination Date. Interest will be
payable monthly on each Distribution Date to the Class B Certificateholders
of record as of the related Record Date. The Record Date with respect to
any Distribution Date shall be the last day of the calendar month preceding
such Distribution Date.
If on any Distribution Date the Class B Floating Allocation
Percentage of Collections in respect of Finance Charge Receivables
deposited in the Finance Charge Account for the related Monthly Period plus
the amount of Excess Finance Charge Collections available with respect to
the Class B Certificates on such Distribution Date as specified in the
Agreement is insufficient to cover the Class B Monthly Interest and any
overdue Class B Monthly Interest due on such Distribution Date, Class B
Default Interest, if any, for such Distribution Date, any overdue Class B
Default
<PAGE>
Interest, the Class B Investor Default Amount for such Distribution Date
and, if the Bank is no longer the Servicer, the Class B Monthly Servicing
Fee for such Distribution Date (such deficiency the "Class B Required
Amount"), any Excess Finance Charge Collections remaining after application
thereof to fund the Class A Required Amount, if any, on such Distribution
Date will be applied to fund the Class B Required Amount. If Excess
Finance Charge Collections are insufficient to fund the Class A Required
Amount, if any, an amount equal to the lesser of (x) the CIA Invested
Amount and (y) the product of (a)(i) during the Revolving Period, the CIA
Floating Allocation Percentage or (ii) during an Amortization Period, the
CIA Fixed/Floating Allocation Percentage and (b) the amount of Collections
of Principal Receivables with respect to the related Monthly Period (such
amount as so applied, "Reallocated CIA Principal Collections") will be
applied first to the extent of any remaining Class A Required Amount and
second to the extent of the lesser of any remaining Reallocated CIA
Principal Collections and any remaining Class B Required Amount.
If the Class A Required Amount for any Monthly Period exceeds
both the amount of available Excess Finance Charge Collections and the
amount of available Reallocated CIA Principal Collections for such Monthly
Period, then an amount equal to the lesser of (x) the Class B Invested
Amount and (y) the product of (a)(i) during the Revolving Period, the Class
B Floating Allocation Percentage or (ii) during an Amortization Period, the
Class B Fixed/Floating Allocation Percentage and (b) the amount of
Collections of Principal Receivables with respect to the related Monthly
Period (such amount as so applied, "Reallocated Class B Principal
Collections") will be applied to the extent of any remaining Class A
Required Amount.
On each Distribution Date the CIA Invested Amount will be reduced
by the amount of Reallocated CIA Principal Collections and by the amount of
Reallocated Class B Principal Collections for such Distribution Date. In
the event that such reduction would cause the CIA Invested Amount to be a
negative number, the CIA Invested Amount will be reduced to zero and the
Class B Invested Amount will be reduced by the amount by which the CIA
Invested Amount would have been reduced below zero. In the event that the
reallocation of Collections of Principal Receivables would cause the Class
B Invested Amount to be a negative number on any Distribution Date,
Collections of Principal Receivables will
<PAGE>
be reallocated on such Distribution Date in an aggregate amount equal to
the amount which would cause the Class B Invested Amount to be reduced to
zero.
The Bank, as Servicer, is entitled to receive as servicing
compensation a monthly servicing fee in an amount equal to, with respect to
each Series, one-twelfth of the product of the applicable Servicing Fee
Percentage and the Invested Amount for such Series with respect to the
related Monthly Period. The share of the Servicing Fee for each Monthly
Period allocable to the Class B Certificates shall be equal to one-twelfth
of the product of the Series Servicing Fee Percentage and the Class B
Adjusted Invested Amount on the last day of the preceding Monthly Period
(the "Class B Monthly Servicing Fee").
As described in the Agreement, Collections of Principal
Receivables with respect to any Monthly Period will be allocated on the
related Determination Date on the basis of the aggregate Investor
Percentage of all Series and the Transferor Percentage with respect to the
Principal Receivables. Such allocation will be performed both during the
Revolving Period and any Amortization Period. Throughout the existence of
the Trust, the Servicer will allocate to the Transferor, as holder of the
Exchangeable Transferor Certificate, an amount equal to the Transferor
Percentage of the aggregate amount of Collections of Finance Charge
Receivables and Principal Receivables for each Monthly Period. During the
Revolving Period relating to the Investor Certificates, the Class B
Floating Allocation Percentage of Collections of Principal Receivables and
the CIA Floating Allocation Percentage of Collections of Principal
Receivables will be applied first as Reallocated Principal Collections, to
the extent required, and any remaining amounts together with the Class A
Floating Allocation Percentage of Principal Receivables will be distributed
first to the certificateholders of other Series to the extent of the amount
of Principal Shortfalls, if any, and then to the Transferor in an amount
not to exceed the amount of the Transferor Interest.
Unless a Pay Out Event has occurred, the Accumulation Period will
begin at the close of business on the last day of the Revolving Period and
will end on the earlier of (i) the commencement of the Rapid Amortization
Period, (ii) payment of the Invested Amount in full and (iii) the Series
Termination Date. During the Accumulation Period, prior to the payment of
the Invested Amount in full, amounts equal to
<PAGE>
the sum of (x) the least of (a) Available Investor Principal Collections
for the related Monthly Period, (b) the sum of the applicable Controlled
Accumulation Amount for such Monthly Period and the applicable Accumulation
Shortfall, if any (such applicable sum, the "Controlled Deposit Amount")
and (c) the Adjusted Invested Amount on such Transfer Date plus (y) Excess
Principal Collections from other Series allocable to Series 1996-2 will be
deposited monthly in the Principal Funding Account on each Transfer Date
beginning with the Transfer Date in the month following the commencement of
the Accumulation Period until the Principal Funding Account Balance is
equal to the Invested Amount.
Upon written notice to the Trustee, the Servicer may elect to
postpone the commencement of the Accumulation Period, and extend the length
of the Revolving Period, subject to certain conditions as set forth in the
Agreement. The Servicer may make such election only if the Accumulation
Period Length is less than twelve months. On each Determination Date on
and after the February 2002 Determination Date, until the Accumulation
Period begins, the Servicer will determine the "Accumulation Period
Length," which is the number of months expected to be required to fully
fund the Principal Funding Account no later than the Class A Scheduled
Payment Date, based on (a) the expected monthly collections of Principal
Receivables expected to be distributable to the Certificateholders of all
Series (excluding certain other Series, as set forth in the Agreement),
assuming a principal payment rate no greater than the lowest monthly
principal payment rate on the Receivables for the preceding twelve months
and (b) the amount of principal expected to be distributable to
certificateholders of Series (which may exclude certain other Series) which
are not expected to be in their revolving periods during the Accumulation
Period. If the Accumulation Period Length is less than twelve months, the
Servicer may, at its option, postpone the commencement of the Accumulation
Period such that the number of months included in the Accumulation Period
will be equal to or exceed the Accumulation Period Length. The length of
the Accumulation Period shall not be less than one month.
Unless the Rapid Amortization Period has begun, funds on deposit
in the Principal Funding Account will be distributed to the Class A
Certificateholders on the June 2003 Distribution Date (the "Class A
Scheduled Payment Date"). If the aggregate principal amount of deposits
made to the Principal Funding Account are insufficient to pay in
<PAGE>
full the Class A Invested Amount on the Class A Scheduled Payment Date the
Rapid Amortization Period will commence and on each Distribution Date
thereafter until the Class A Invested Amount is paid in full, the Class A
Certificateholders will receive distributions of Class A Monthly Principal
and Class A Monthly Interest.
On the June 2003 Distribution Date if the Class A Invested Amount
is paid in full, Available Investor Principal Collections and Excess
Principal Collections allocable to Series 1996-2 will be used to pay the
Class B Invested Amount as described in the Agreement. If the Available
Investor Principal Collections and Excess Principal Collections allocable
to Series 1996-2 are insufficient to pay in full the Class B Invested
Amount on the June 2003 Distribution Date, the Rapid Amortization Period
will commence.
If, for any Monthly Period, the Available Investor Principal
Collections for such Monthly Period exceed the applicable Controlled
Deposit Amount, any such excess will be treated as Excess Principal
Collections and allocated to the holders of other Series issued and
outstanding or, subject to certain limitations described in the Agreement,
paid to the holder of the Exchangeable Transferor Certificate. If, for any
Monthly Period, the Available Investor Principal Collections for such
Monthly Period and Excess Principal Collections allocable to Series 1996-2
are less than the applicable Controlled Deposit Amount, the amount of such
deficiency will be the applicable "Accumulation Shortfall" for the
succeeding Monthly Period.
If a Pay Out Event occurs during the Accumulation Period, the
Rapid Amortization Period will commence and any amount on deposit in the
Principal Funding Account will be distributed to the Class A
Certificateholders on the Distribution Date following the Monthly Period in
which the Rapid Amortization Period commences.
During the period beginning on the earlier of the day on which a
Pay Out Event occurs and the Class A Scheduled Payment Date if the Class A
Invested Amount and the Class B Invested Amount are not paid in full on
such date, and ending on the earlier of (i) the date on which the Class A
Invested Amount, the Class B Invested Amount and the CIA Invested Amount
have been paid in full and (ii) the Series Termination Date (the "Rapid
Amortization Period"), collections of Principal Receivables allocated to
the Invested
<PAGE>
Amount will no longer be paid to the holder of the Exchangeable Transferor
Certificate or to the holders of the certificates of any other Series or,
if the Accumulation Period has commenced, deposited in the Principal
Funding Account, but instead will be distributed to the Class A
Certificateholders and, following payment in full of the Class A Invested
Amount, to the Class B Certificateholders, and, following payment in full
of the Class B Invested Amount, to the CIA Certificateholders, monthly on
each Distribution Date beginning with the Distribution Date in the month
following the commencement of the Rapid Amortization Period.
Principal payments on the Class B Certificates will be, during
the Accumulation Period, funded by deposits to the Principal Funding
Account or, during the Rapid Amortization Period, made monthly, and will
commence on the date (the "Class B Principal Commencement Date") which is
(a) with respect to the Accumulation Period, the first Distribution Date on
which an amount equal to the Class A Invested Amount has been deposited in
the Principal Funding Account and allocated to the Class A Certificates or
(b) with respect to the Rapid Amortization Period, the Distribution Date on
which the Class A Invested Amount has been paid in full or, if there are no
Principal Receivables allocable to the Investor Certificates remaining
after payments have been made to the Class A Certificates on such
Distribution Date, the Distribution Date following the Distribution Date on
which the Class A Invested Amount has been paid in full. After payment in
full of the Class A Invested Amount, amounts deposited in the Principal
Funding Account for the benefit of the Class B Certificates will be paid to
the Class B Certificateholders on the June 2003 Distribution Date and on
each Distribution Date during the Rapid Amortization Period beginning with
the Class B Principal Commencement Date, and thereafter until the payment
in full of the Class B Invested Amount or the termination of the Trust, the
Percentage Allocation of all collections of Principal Receivables and
certain other amounts for the preceding Monthly Period remaining after
payment in full of the Class A Invested Amount will be distributed to the
Class B Certificateholders.
Subject to the Agreement, payments of principal are limited to
the unpaid Class B Invested Amount of the Class B Certificates, which may
be less than the unpaid balance of the Class B Certificates pursuant to the
terms of the Agreement. All principal of and interest on the Class B
<PAGE>
Certificates is due and payable no later than February 10, 2006 (or if such
day is not a Business Day, the next succeeding Business Day) (the "Series
Termination Date"). After the Series Termination Date, neither the Trust
nor the Transferor will have any further obligation to distribute principal
or interest on the Class B Certificates. In the event that the Invested
Amount is greater than zero on the Series Termination Date, the Trustee
will sell or cause to be sold, to the extent necessary, an amount of
interests in the Receivables or certain of the Receivables up to 110% of
the sum of the Class A Invested Amount, the Class B Invested Amount and the
CIA Invested Amount at the close of business on such date (but not more
than the total amount of Receivables allocable to the Investor
Certificates), and shall pay the proceeds to the Class A Certificateholders
pro rata then to the Class B Certificateholders pro rata and then to the
CIA Certificateholders pro rata in final payment of the Investor
Certificates.
The transfer of this Certificate shall be registered in the
Certificate Register upon surrender of this Certificate for registration of
transfer at any office or agency maintained by the Transfer Agent and
Registrar accompanied by a written instrument of transfer in a form
satisfactory to the Trustee and the Transfer Agent and Registrar duly
executed by the Certificateholder or such Certificateholder's attorney 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.
As provided in the Agreement and subject to certain limitations
therein set forth, Class B Certificates are exchangeable for new Class B
Certificates evidencing like aggregate Undivided Interests, as requested by
the Class B Certificateholder surrendering such Class B Certificates. No
service charge may be imposed for any such exchange but the Transferor,
Servicer, or Transfer Agent and Registrar may require payment of a sum
sufficient to cover any tax or other governmental charge that may be
imposed in connection therewith.
The Transferor, the Servicer, the Trustee, the Paying Agent and
the Transfer Agent and Registrar, and any agent of any of them, may treat
the person in whose name this Certificate is registered as the owner hereof
for all purposes, and neither the Transferor, the Servicer, the
<PAGE>
Trustee, the Paying Agent and 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 Agreement.
The Agreement and any Supplement may be amended by the
Transferor, the Servicer and the Trustee, without the consent of
certificateholders of any Series then outstanding for any purpose, provided
--------
that (i) the Transferor shall deliver an opinion of counsel acceptable to
the Trustee to the effect that such amendment will not adversely affect in
any material respect the interest of such certificateholders, and (ii) such
amendment will not result in a withdrawal or reduction of the rating of any
outstanding Series.
The Agreement and the Series 1996-2 Supplement may be amended by
the Transferor, the Servicer and the Trustee with the consent of the
holders of certificates evidencing undivided interests aggregating not less
than 66-2/3% of the investor interests of all Series adversely affected,
for the purpose of adding any provisions to, changing in any manner or
eliminating any of the provisions of the Agreement or the Series 1996-2
Supplement or of modifying in any manner the rights of certificateholders
of any then outstanding Series. No such amendment, however, may (a) reduce
in any manner the amount of, or delay the timing of, distributions required
to be made on any such Series, (b) change the definition of or the manner
of calculating the interest of any certificateholder of such Series, or (c)
reduce the aforesaid percentage of undivided interests the holders of which
are required to consent to any such amendment, in each case without the
consent of all certificateholders of all Series adversely affected.
Promptly following the execution of any amendment to the Agreement, the
Trustee will furnish written notice of the substance of such amendment to
each Class B Certificateholder.
<PAGE>
Unless the certificate of authentication hereon has been executed
by or on behalf of the Trustee, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement, or be valid for any
purpose.
IN WITNESS WHEREOF, the Transferor has caused this Certificate to
be duly executed on this 4th day of June, 1996.
FIRST USA BANK
By:____________________________
Name: Steven L. McDonald
Title: Senior Vice President
CERTIFICATE OF AUTHENTICATION
This is one of the Class B Certificates referred to in the
within-mentioned Pooling and Servicing Agreement.
THE BANK OF NEW YORK,
as Authenticating Agent
Date: June 4, 1996
By:__________________________
Name:
Title:
<PAGE>
EXHIBIT C
EACH PURCHASER REPRESENTS AND WARRANTS FOR THE BENEFIT OF FIRST
USA BANK AND THE TRUSTEE THAT SUCH PURCHASER IS NOT (I) AN EMPLOYEE BENEFIT
PLAN (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY
ACT OF 1974, AS AMENDED ("ERISA")) THAT IS SUBJECT TO THE PROVISIONS OF
TITLE I OF ERISA, (II) A PLAN DESCRIBED IN SECTION 4975(E)(1) OF THE
INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE "CODE"), (III) A
GOVERNMENTAL PLAN, AS DEFINED IN SECTION 3(32) OF ERISA, SUBJECT TO ANY
FEDERAL, STATE OR LOCAL LAW WHICH IS, TO A MATERIAL EXTENT, SIMILAR TO THE
PROVISIONS OF SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE, (IV) AN
ENTITY WHOSE UNDERLYING ASSETS INCLUDE PLAN ASSETS BY REASON OF A PLAN'S
INVESTMENT IN THE ENTITY OR (V) A PERSON INVESTING "PLAN ASSETS" OF ANY
SUCH PLAN (EXCLUDING FOR PURPOSES OF THIS CLAUSE (V), ANY ENTITY REGISTERED
UNDER THE INVESTMENT COMPANY ACT OF 1940, AS AMENDED); PROVIDED, HOWEVER,
THAT A PURCHASER SHALL NOT BE REQUIRED TO MAKE THE REPRESENTATIONS AND
WARRANTIES SET FORTH IN CLAUSE (IV) OR (V) ABOVE IF THE TRUSTEE SHALL HAVE
RECEIVED THE PRIOR WRITTEN CONSENT OF THE TRANSFEROR TO THE TRANSFER TO
SUCH ENTITY.
THIS CERTIFICATE MAY NOT BE ACQUIRED, SOLD, TRADED OR
TRANSFERRED, NOR MAY AN INTEREST IN THIS CERTIFICATE BE MARKETED, ON OR
THROUGH (I) AN "ESTABLISHED SECURITIES MARKET" WITHIN THE MEANING OF
SECTION 7704(B)(1) OF THE CODE AND ANY PROPOSED, TEMPORARY OR FINAL
TREASURY REGULATION THEREUNDER, INCLUDING, WITHOUT LIMITATION, AN OVER-THE-
COUNTER-MARKET OR AN INTERDEALER QUOTATION SYSTEM THAT REGULARLY
DISSEMINATES FIRM BUY OR SELL QUOTATIONS OR (II) A "SECONDARY MARKET"
WITHIN THE MEANING OF SECTION 7704(B)(2) OF THE CODE AND ANY PROPOSED,
TEMPORARY OR FINAL TREASURY REGULATION THEREUNDER, INCLUDING A MARKET
WHEREIN INTERESTS IN THE CIA CERTIFICATES ARE REGULARLY QUOTED BY ANY
PERSON MAKING A MARKET IN SUCH INTERESTS AND A MARKET WHEREIN ANY PERSON
REGULARLY MAKES AVAILABLE BID OR OFFER QUOTES WITH RESPECT TO INTERESTS IN
THE CIA CERTIFICATES AND STANDS READY TO EFFECT BUY OR SELL TRANSACTIONS AT
THE QUOTED PRICES FOR ITSELF OR ON BEHALF OF OTHERS.
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR ANY STATE
SECURITIES LAW. THE HOLDER HEREOF, BY PURCHASING THIS CERTIFICATE, AGREES
THAT THIS
<PAGE>
CERTIFICATE MAY BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY
IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS AND ONLY
(1) TO THE TRANSFEROR, (2) TO A LIMITED NUMBER OF INSTITUTIONAL "ACCREDITED
INVESTORS" (AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) UNDER THE
SECURITIES ACT) AND IN A TRANSACTION EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT (UPON DELIVERY OF THE DOCUMENTATION
REQUIRED BY THE POOLING AND SERVICING AGREEMENT AND, IF THE TRUSTEE SO
REQUIRES, AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE) OR (3)
PURSUANT TO RULE 144A UNDER THE SECURITIES ACT TO A PERSON THAT THE HOLDER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING
OF RULE 144A ("QIB") PURCHASING FOR ITS OWN ACCOUNT OR A QIB PURCHASING FOR
THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE
REOFFER, RESALE, PLEDGE OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE
144A. EACH CERTIFICATE OWNER BY ACCEPTING A BENEFICIAL INTEREST IN THIS
CERTIFICATE IS DEEMED TO REPRESENT THAT IT IS EITHER A QIB PURCHASING FOR
ITS OWN ACCOUNT, A QIB PURCHASING FOR THE ACCOUNT OF ANOTHER QIB OR AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(A)(1), (2), (3)
OR (7) UNDER THE SECURITIES ACT). THIS CERTIFICATE WILL NOT BE ACCEPTED
FOR REGISTRATION OF TRANSFER EXCEPT UPON PRESENTATION OF EVIDENCE
SATISFACTORY TO THE TRANSFER AGENT AND REGISTRAR THAT THE RESTRICTIONS ON
TRANSFER SET FORTH IN THE SERIES 1996-2 SUPPLEMENT HAVE BEEN COMPLIED WITH.
THIS CERTIFICATE MAY NOT BE REOFFERED, RESOLD, PLEDGED OR OTHERWISE
TRANSFERRED WITHOUT THE PRIOR WRITTEN CONSENT OF EACH OF THE TRANSFEROR AND
THE SERVICER AND UNLESS AND UNTIL THE TRUSTEE SHALL HAVE RECEIVED THE
CERTIFICATIONS REQUIRED BY THE SERIES 1996-2 SUPPLEMENT.
No. R-1 $_______________
Series Termination
Date: February 10, 2006 CUSIP NO. 337435BL4
FIRST USA CREDIT CARD MASTER TRUST
CIA CERTIFICATE, SERIES 1996-2
Evidencing an undivided interest in a trust, the corpus of which consists
of receivables generated from time to time in the ordinary course of
business in a portfolio of VISA(R) and
<PAGE>
MasterCard(R)* credit card accounts generated or to be generated by
First USA Bank (the "Bank").
(Not an interest in or a recourse obligation
of First USA Bank or any affiliate thereof)
This certifies that BEAR, STEARNS SECURITIES CORP. (the
"Certificateholder") is the registered owner of a fractional undivided
interest in the First USA Credit Card Master Trust (the "Trust") issued
pursuant to the Pooling and Servicing Agreement, dated as of September 1,
1992 between the Bank, as Transferor (the "Transferor") and as Servicer
(the "Servicer"), and The Bank of New York (Delaware) (as successor to The
Bank of New York as successor to NationsBank, N.A.), as trustee (the
"Trustee") of the Trust (the "Agreement"; such term to include any
Supplement or amendment thereto) as amended by Assignment No. 17 of
Receivables in Additional Accounts dated as of June 4, 1996 among the Bank,
as Transferor and Servicer, the Trustee and The Bank of New York (Delaware)
(as successor to The Bank of New York as successor to NationsBank, N.A.),
as trustee of the First USA Credit Card Master Trust II, and as
supplemented by the Series 1996-2 Supplement (the "Series 1996-2
Supplement"), dated as of June 4, 1996, between the Bank, as Transferor and
Servicer, and the Trustee. The corpus of the Trust consists of all of the
Transferor's right, title and interest in a portfolio of receivables (the
"Receivables") existing in certain VISA(R) and MasterCard(R) revolving
credit card accounts identified in the Agreement from time to time (the
"Accounts"), all Receivables generated under the Accounts from time to time
thereafter, all monies due or to become due (other than recoveries on
charged-off Receivables) and all amounts received with respect to the
Receivables in existence in the Accounts, all monies on deposit in certain
bank accounts (excluding any investment earnings on such deposited amounts
except as set forth in the Series 1996-2 Supplement), and all other assets
and interests constituting the Trust and all proceeds of the foregoing.
The Receivables consist of amounts charged by cardholders for goods and
services and cash advances (such amounts, less the amount of Discount
Receivables, the "Principal Receivables"), plus the related periodic
finance charges (the
--------------------
* VISA(R) and MasterCard(R) are registered trademarks of Visa USA
Incorporated and MasterCard International Incorporated, respectively.
<PAGE>
"Periodic Finance Charges"), annual membership fees ("Annual Membership
Fees"), and amounts charged to the Accounts in respect of cash advance
finance charges, late fees, overlimit fees, return check fees and similar
fees and charges (the "Other Charges"). Receivables in an amount equal to
the product of the Yield Factor (initially 1.3%) and amounts charged by
cardholders for goods and services and cash advances (the "Discount
Receivables") will be allocated to the Certificates and treated as Finance
Charge Receivables (Discount Receivables, together with the Periodic
Finance Charges, Annual Membership Fees and Other Charges, the "Finance
Charge Receivables").
Although a summary of certain provisions of the Agreement is set
forth below, this CIA Certificate does not purport to summarize the
Agreement and reference is made to the Agreement for information with
respect to the interests, rights, benefits, obligations, proceeds, and
duties evidenced hereby and the rights, duties and obligations of the
Trustee. A copy of the Agreement may be requested from the Trustee by
writing to the Trustee at The Bank of New York (Delaware), White Clay
Center, Route 273, Newark, Delaware, 19711, Attention: Bond
Administration. To the extent not defined herein, the capitalized terms
used herein have the meanings ascribed to them in the Agreement. This
Certificate is one of a Series of Certificates entitled "First USA Credit
Card Master Trust CIA Certificates, Series 1996-2" (the "CIA
Certificates"), each of which represents a fractional undivided interest in
the Trust, and is issued under and is subject to the terms, provisions and
conditions of the Agreement, to which Agreement, as amended from time to
time, the Certificateholder by virtue of the acceptance hereof assents and
by which the Certificateholder is bound. In the case of any conflict
between terms specified in this CIA Certificate and terms specified in the
Agreement, the terms of the Agreement shall govern.
The Transferor has structured the Agreement, the CIA
Certificates, the First USA Credit Card Master Trust Class A Floating Rate
Asset Backed Certificates, Series 1996-2 (the "Class A Certificates") and
the First USA Credit Card Master Trust Class B Floating Rate Asset Backed
Certificates, Series 1996-2 (the "Class B Certificates") with the intention
that the CIA Certificates, the Class A Certificates and Class B
Certificates will qualify under applicable tax law as indebtedness, and the
Transferor and each holder of a CIA Certificate (a "CIA Certificateholder")
or any
<PAGE>
interest therein, by acceptance of its CIA Certificate or any interest
therein, agrees to treat the CIA Certificates for purposes of federal,
state, local and foreign income or franchise taxes and any other tax
imposed on or measured by income, as indebtedness.
The Trust's assets are allocated in part to the holders of the
Class A Certificates, the holders of the Class B Certificates and the
holders of the CIA Certificates (such holders together the "Investor
Certificateholders") with the remainder allocated to holders of other
Series of Certificates issued by the Trust, if any, and to the Transferor.
In addition to the Class A Certificates, the Class B Certificates and the
CIA Certificates, the Exchangeable Transferor Certificate will be reissued
pursuant to the Agreement and will represent the Transferor's interest in
the Trust. The reissued Exchangeable Transferor Certificate will represent
the interest in the Principal Receivables not represented by the Class A
Certificates, the Class B Certificates and the CIA Certificates (together
the "Investor Certificates") or any other Series of Certificates. The
Exchangeable Transferor Certificate may be exchanged by the Transferor
pursuant to the Agreement for one or more Series of Certificates and a
reissued Exchangeable Transferor Certificate upon the conditions set forth
in the Agreement. In addition, to the extent permitted for any Series of
Certificates by the related Supplement, the Certificateholders of such
Series may tender their Certificates and the Transferor may tender the
Exchangeable Transferor Certificate in exchange for one or more Series of
Certificates and a reissued Exchangeable Transferor Certificate.
The CIA Initial Invested Amount is $68,700,000. The CIA Invested
Amount for any monthly Distribution Date will be an amount equal to (i)
$68,700,000, minus (ii) the aggregate amount of principal payments made to
-----
the CIA Certificateholders prior to such Distribution Date, minus (iii) the
-----
aggregate amount of CIA Investor Charge-Offs for all prior Distribution
Dates, minus (iv) the aggregate amount of Reallocated Principal Collections
-----
for all prior Distribution Dates which have been used to fund the Class A
Required Amount or the Class B Required Amount, minus (v) an amount equal
-----
to the aggregate amount by which the CIA Invested Amount has been reduced
to fund the Class A Investor Default Amount and the Class B Investor
Default Amount on all prior Distribution Dates as described in the
Agreement and plus (vi) the aggregate amount of Excess Finance Charge
----
<PAGE>
Collections and certain other amounts allocated and available for purposes
of reimbursing amounts deducted pursuant to the foregoing clauses (ii),
(iii) and (iv); provided, however, that the CIA Invested Amount may not be
-------- -------
reduced below zero.
The CIA Certificates will bear interest at the rate of 6.4375%
per annum on the CIA Initial Invested Amount from June 4, 1996 through July
9, 1996, and for each Interest Period thereafter, the CIA Certificates will
bear interest at a per annum rate of 1.00% in excess of LIBOR as determined
by the Trustee on the related LIBOR Determination Date (each such rate as
in effect from time to time, the "CIA Certificate Rate"). Interest will be
distributed to the extent of available funds on July 10, 1996, and on the
tenth day of each month thereafter, or if such day is not a Business Day,
the next succeeding Business Day until the earlier of the day on which the
CIA Invested Amount is paid in full and the Series Termination Date (each
such date a "Distribution Date"), in an amount equal to the product of (a)
the actual number of days in the related Interest Period divided by 360,
(b) the CIA Certificate Rate and (c) the CIA Outstanding Principal Balance
on the last day of the Monthly Period immediately preceding such
Distribution Date. Interest for a Distribution Date will accrue from and
including the previous Distribution Date (or in the case of the first
Distribution Date, from and including the Closing Date), to, and including,
the day immediately preceding the current Distribution Date. Interest
payments will be made on July 10, 1996 and on each Distribution Date
thereafter until the Series 1996-2 Termination Date. Interest will be
payable monthly on each Distribution Date to the CIA Certificateholders of
record as of the related Record Date. The Record Date with respect to any
Distribution Date shall be the last day of the calendar month preceding
such Distribution Date.
The Servicer will establish and maintain a "Spread Account" with
The Bank of New York, as collateral agent (the "Collateral Agent") for the
benefit of the CIA Certificateholders and First USA Bank as holder of the
Transferor Interest, pursuant to a spread account agreement among the
Transferor, the Servicer and the Trustee (the "Spread Account Agreement").
Amounts on deposit in the Spread Account will be used to fund shortfalls in
amounts available to fund the CIA Required Amount and to make payments to
the CIA Certificateholders, following payment in full of the Class A
Invested Amount and the Class B Invested Amount, of the
<PAGE>
excess, if any, of the CIA Outstanding Principal Balance over the CIA
Invested Amount. If, at any time prior to the payment in full of the Class
A Invested Amount and the Class B Invested Amount, the CIA Principal
Balance is greater than the CIA Invested Amount, the lesser of the amount
on deposit in the Spread Account and the amount of such excess will be held
in a sub-account of the Spread Account (the "Principal Subaccount").
Under certain circumstances described in the Spread Account
Agreement, the Spread Account will be funded by Excess Finance Charge
Collections and in certain circumstances such amounts may be released from
the Spread Account.
Excess Finance Charge Collections remaining after prior
application thereof and available to be applied in accordance with the
provisions of the Spread Account Agreement will be applied in the following
priority: (i) to make payment to the CIA Certificateholders of an amount
equal to the CIA Interest Payment Shortfall (as defined below), if any;
(ii) to fund the Spread Account to the extent that the required Spread
Account amount exceeds the amount then available therein; and (iii) the
remainder will be paid to the holder of the Exchangeable Transferor
Certificate.
"CIA Interest Payment Shortfall" means with respect to any
Transfer Date, the amount by which the CIA Monthly Interest and any overdue
CIA Monthly Interest (and default interest thereon) for the related
Distribution Date exceeds the amount of Excess Finance Charge Collections
applied to the payment thereof.
If on any Transfer Date, the CIA Interest Payment Shortfall
exceeds the amount of Excess Finance Charge Collections allocated to the
payment thereof, the Trustee, at the instruction of the Servicer, shall
withdraw from the Spread Account the lesser of (i) the amount on deposit in
the Spread Account (not including amounts allocated to the Principal
Subaccount, if any) on such Transfer Date and (ii) the amount of such
excess, and shall pay such amount to the CIA Certificateholders pro rata in
accordance with their respective CIA Invested Amounts. If on any Transfer
Date after the Distribution Date on which the Class A Invested Amount and
the Class B Invested Amount have been paid in full, the CIA Principal
Balance exceeds the CIA Invested Amount, the Trustee, at the instruction of
the Servicer,
<PAGE>
shall withdraw from the Spread Account the lesser of (i) the amount on
deposit in the Spread Account (including amounts allocated to the Principal
Subaccount, if any) on such Transfer Date and (ii) the amount of such
excess and shall pay such amount to the CIA Certificateholders pro rata in
proportion to their respective CIA Invested Amounts on the related
Distribution Date. On the date on which all amounts due to the
Certificateholders have been paid in full, all amounts, if any, then
remaining in the Spread Account shall be distributed to the holder of the
Exchangeable Transferor Certificate or the spread replacement amount
providers, as appropriate.
On each Distribution Date the CIA Invested Amount will be reduced
by the amount of Reallocated CIA Principal Collections and by the amount of
Reallocated Class B Principal Collections for such Distribution Date. In
the event that such reduction would cause the CIA Invested Amount to be a
negative number, the CIA Invested Amount will be reduced to zero and the
Class B Invested Amount will be reduced by the amount by which the CIA
Invested Amount would have been reduced below zero. In the event that the
reallocation of Collections of Principal Receivables would cause the Class
B Invested Amount to be a negative number on any Distribution Date,
Collections of Principal Receivables will be reallocated on such
Distribution Date in an aggregate amount equal to the amount which would
cause the Class B Invested Amount to be reduced to zero.
The Bank, as Servicer, is entitled to receive as servicing
compensation a monthly servicing fee in an amount equal to, with respect to
each Series, one-twelfth of the product of the applicable Servicing Fee
Percentage and the Invested Amount for such Series with respect to the
related Monthly Period. The share of the Servicing Fee for each Monthly
Period allocable to the CIA Certificates shall be equal to one-twelfth of
the product of the Series Servicing Fee Percentage and the CIA Adjusted
Invested Amount on the last day of the preceding Monthly Period (the "CIA
Monthly Servicing Fee").
As described in the Agreement, Collections of Principal
Receivables with respect to any Monthly Period will be allocated on the
related Determination Date on the basis of the aggregate Investor
Percentage of all Series and the Transferor Percentage with respect to the
Principal Receivables. Such allocation will be performed both during
<PAGE>
the Revolving Period and any Amortization Period. Throughout the existence
of the Trust, the Servicer will allocate to the Transferor, as holder of
the Exchangeable Transferor Certificate, an amount equal to the Transferor
Percentage of the aggregate amount of Collections of Finance Charge
Receivables and Principal Receivables for each Monthly Period. During the
Revolving Period relating to the Investor Certificates, the Class B
Floating Allocation Percentage of Collections of Principal Receivables and
the CIA Floating Allocation Percentage of Collections of Principal
Receivables will be applied first as Reallocated Principal Collections, to
the extent required, and any remaining amounts together with the Class A
Floating Allocation Percentage of Principal Receivables will be distributed
first to the certificateholders of other Series to the extent of the amount
of Principal Shortfalls, if any, and then to the Transferor in an amount
not to exceed the amount of the Transferor Interest.
Unless a Pay Out Event has occurred, the Accumulation Period will
begin at the close of business on the last day of the Revolving Period and
will end on the earlier of (i) the commencement of the Rapid Amortization
Period, (ii) payment of the Invested Amount in full and (iii) the Series
Termination Date. During the Accumulation Period, prior to the payment of
the Invested Amount in full, amounts equal to the sum of (x) the least of
(a) Available Investor Principal Collections for the related Monthly
Period, (b) the sum of the applicable Controlled Accumulation Amount for
such Monthly Period and the applicable Accumulation Shortfall, if any (such
applicable sum, the "Controlled Deposit Amount") and (c) the Adjusted
Invested Amount on such Transfer Date plus (y) Excess Principal Collections
from other Series allocable to Series 1996-2 will be deposited monthly in
the Principal Funding Account on each Transfer Date beginning with the
Transfer Date in the month following the commencement of the Accumulation
Period until the Principal Funding Account Balance is equal to the Invested
Amount.
Upon written notice to the Trustee, the Servicer may elect to
postpone the commencement of the Accumulation Period, and extend the length
of the Revolving Period, subject to certain conditions as set forth in the
Agreement. The Servicer may make such election only if the Accumulation
Period Length is less than twelve months. On each Determination Date on
and after the February 2002 Determination Date, until the Accumulation
Period begins, the Servicer will determine the "Accumulation Period
Length," which is
<PAGE>
the number of months expected to be required to fully fund the Principal
Funding Account no later than the Class A Scheduled Payment Date, based on
(a) the expected monthly collections of Principal Receivables expected to
be distributable to the Certificateholders of all Series (excluding certain
other Series, as set forth in the Agreement), assuming a principal payment
rate no greater than the lowest monthly principal payment rate on the
Receivables for the preceding twelve months and (b) the amount of principal
expected to be distributable to certificateholders of Series (which may
exclude certain other Series) which are not expected to be in their
revolving periods during the Accumulation Period. If the Accumulation
Period Length is less than twelve months, the Servicer may, at its option,
postpone the commencement of the Accumulation Period such that the number
of months included in the Accumulation Period will be equal to or exceed
the Accumulation Period Length. The length of the Accumulation Period
shall not be less than one month.
Unless the Rapid Amortization Period has begun, funds on deposit
in the Principal Funding Account will be distributed to the Class A
Certificateholders on the June 2003 Distribution Date (the "Class A
Scheduled Payment Date"). If the aggregate principal amount of deposits
made to the Principal Funding Account are insufficient to pay in full the
Class A Invested Amount on the Class A Scheduled Payment Date the Rapid
Amortization Period will commence and on each Distribution Date thereafter
until the Class A Invested Amount is paid in full, the Class A
Certificateholders will receive distributions of Class A Monthly Principal
and Class A Monthly Interest.
On the June 2003 Distribution Date if the Class A Invested Amount
is paid in full, Available Investor Principal Collections and Excess
Principal Collections allocable to Series 1996-2 will be used to pay the
Class B Invested Amount as described in the Agreement. If the Available
Investor Principal Collections and Excess Principal Collections allocable
to Series 1996-2 are insufficient to pay in full the Class B Invested
Amount on the June 2003 Distribution Date, the Rapid Amortization Period
will commence.
On the June 2003 Distribution Date if the Class A Invested Amount
and the Class B Invested Amount each is paid in full, Available Investor
Principal Collections and Excess Principal Collections allocable to Series
1996-2 remaining after payment in full of the Class A Invested Amount and
the
<PAGE>
Class B Invested Amount will be used to pay the CIA Invested Amount until
the earlier of the date on which the CIA Invested Amount is paid in full
and the Series Termination Date, as described in the Agreement.
If, for any Monthly Period, the Available Investor Principal
Collections for such Monthly Period exceed the applicable Controlled
Deposit Amount, any such excess will be treated as Excess Principal
Collections and allocated to the holders of other Series issued and
outstanding or, subject to certain limitations described in the Agreement,
paid to the holder of the Exchangeable Transferor Certificate. If, for any
Monthly Period, the Available Investor Principal Collections for such
Monthly Period and Excess Principal Collections allocable to Series 1996-2
are less than the applicable Controlled Deposit Amount, the amount of such
deficiency will be the applicable "Accumulation Shortfall" for the
succeeding Monthly Period.
If a Pay Out Event occurs during the Accumulation Period, the
Rapid Amortization Period will commence and any amount on deposit in the
Principal Funding Account will be distributed to the Class A
Certificateholders on the Distribution Date following the Monthly Period in
which the Rapid Amortization Period commences.
During the period beginning on the earlier of the day on which a
Pay Out Event occurs and the Class A Scheduled Payment Date if the Class A
Invested Amount and the Class B Invested Amount are not paid in full on
such date, and ending on the earlier of (i) the date on which the Class A
Invested Amount, the Class B Invested Amount and the CIA Invested Amount
have been paid in full and (ii) the Series Termination Date (the "Rapid
Amortization Period"), collections of Principal Receivables allocated to
the Invested Amount will no longer be paid to the holder of the
Exchangeable Transferor Certificate or to the holders of the certificates
of any other Series or, if the Accumulation Period has commenced, deposited
in the Principal Funding Account, but instead will be distributed to the
Class A Certificateholders and, following payment in full of the Class A
Invested Amount, to the Class B Certificateholders, and, following payment
in full of the Class B Invested Amount, to the CIA Certificateholders,
monthly on each Distribution Date beginning with the Distribution Date in
the month following the commencement of the Rapid Amortization Period.
<PAGE>
Principal payments on the CIA Certificates will be, during the
Accumulation Period, funded by deposits to the Principal Funding Account
or, during the Rapid Amortization Period, made monthly, and will commence
on the date (the "CIA Principal Commencement Date") which is (a) with
respect to the Accumulation Period, the first Distribution Date on which an
amount equal to the sum of the Class A Invested Amount and the Class B
Invested Amount has been deposited in the Principal Funding Account and
allocated to the Class A Certificates and the Class B Certificates or (b)
with respect to the Rapid Amortization Period, the Distribution Date on
which the Class A Invested Amount and the Class B Invested Amount have each
been paid in full or, if there are no Principal Receivables allocable to
the Investor Certificates remaining after payments have been made to the
Class A Certificates and the Class B Certificates on such Distribution
Date, the Distribution Date following the Distribution Date on which the
Class A Invested Amount and the Class B Invested Amount have each been paid
in full. After payment in full of the Class A Invested Amount and the
Class B Invested Amount, amounts deposited in the Principal Funding Account
for the benefit of the CIA Certificates will be paid to the CIA
Certificateholders on the June 2003 Distribution Date and on each
Distribution Date during the Rapid Amortization Period beginning with the
CIA Principal Commencement Date, and thereafter until the payment in full
of the CIA Invested Amount or the termination of the Trust, the Percentage
Allocation of all Collections of Principal Receivables and certain other
amounts for the preceding Monthly Period remaining after payment in full of
the Class A Invested Amount and the Class B Invested Amount will be
distributed to the CIA Certificateholders.
Subject to the Agreement, payments of principal are limited to
the unpaid CIA Invested Amount of the CIA Certificates, which may be less
than the unpaid balance of the CIA Certificates pursuant to the terms of
the Agreement. All principal of and interest on the CIA Certificates is
due and payable no later than February 10, 2006 (or if such day is not a
Business Day, the next succeeding Business Day) (the "Series Termination
Date"). After the Series Termination Date, neither the Trust nor the
Transferor will have any further obligation to distribute principal or
interest on the CIA Certificates. In the event that the Invested Amount is
greater than zero on the Series Termination Date, the Trustee will sell or
cause to be sold, to the extent necessary, an amount of interests in the
Receivables or
<PAGE>
certain of the Receivables up to 110% of the sum of the Class A Invested
Amount, the Class B Invested Amount and the CIA Invested Amount at the
close of business on such date (but not more than the total amount of
Receivables allocable to the Investor Certificates), and shall pay the
proceeds to the Class A Certificateholders pro rata then to the Class B
Certificateholders pro rata and then to the CIA Certificateholders pro rata
in final payment of the Investor Certificates.
The transfer of this Certificate shall be registered in the
Certificate Register upon surrender of this Certificate for registration of
transfer at any office or agency maintained by the Transfer Agent and
Registrar accompanied by a written instrument of transfer in a form
satisfactory to the Trustee and the Transfer Agent and Registrar duly
executed by the Certificateholder or such Certificateholder's attorney duly
authorized in writing, and thereupon one or more new CIA Certificates of
authorized denominations and for the same aggregate Undivided Interests
will be issued to the designated transferee or transferees.
As provided in the Agreement and subject to certain limitations
therein set forth, CIA Certificates are exchangeable for new CIA
Certificates evidencing like aggregate Undivided Interests, as requested by
the CIA Certificateholder surrendering such CIA Certificates. No service
charge may be imposed for any such exchange but the Transferor, Servicer,
or Transfer Agent and Registrar may require payment of a sum sufficient to
cover any tax or other governmental charge that may be imposed in
connection therewith.
The Transferor, the Servicer, the Trustee, the Paying Agent and
the Transfer Agent and Registrar, and any agent of any of them, may treat
the person in whose name this Certificate is registered as the owner hereof
for all purposes, and neither the Transferor, the Servicer, the Trustee,
the Paying Agent and 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 Agreement.
The Agreement and any Supplement may be amended by the
Transferor, the Servicer and the Trustee, without the consent of
certificateholders of any Series then outstanding for any purpose, provided
--------
that (i) the Transferor shall
<PAGE>
deliver an opinion of counsel acceptable to the Trustee to the effect that
such amendment will not adversely affect in any material respect the
interest of such certificateholders, and (ii) such amendment will not
result in a withdrawal or reduction of the rating of any outstanding
Series.
The Agreement and the Series 1996-2 Supplement may be amended by
the Transferor, the Servicer and the Trustee with the consent of the
holders of certificates evidencing undivided interests aggregating not less
than 66-2/3% of the investor interests of all Series adversely affected,
for the purpose of adding any provisions to, changing in any manner or
eliminating any of the provisions of the Agreement or the Series 1996-2
Supplement or of modifying in any manner the rights of certificateholders
of any then outstanding Series. No such amendment, however, may (a) reduce
in any manner the amount of, or delay the timing of, distributions required
to be made on any such Series, (b) change the definition of or the manner
of calculating the interest of any certificateholder of such Series, or (c)
reduce the aforesaid percentage of undivided interests the holders of which
are required to consent to any such amendment, in each case without the
consent of all certificateholders of all Series adversely affected.
Promptly following the execution of any amendment to the Agreement, the
Trustee will furnish written notice of the substance of such amendment to
each CIA Certificateholder.
The holder of this Certificate by its acceptance hereof agrees
that it will not institute or join against the Trust or the Transferor any
bankruptcy, reorganization, arrangement, insolvency or liquidation
proceeding or other proceeding under any federal or state bankruptcy or
similar law, for one year and a day after the payment in full of the last
outstanding investor certificate issued by the First USA Credit Card Master
Trust; provided, that the foregoing shall not limit the right of the holder
--------
of this Certificate to file any claim in or otherwise take any action with
respect to any such bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding that was instituted by any person other than a CIA
Certificate holder.
The holder hereof by its acceptance of this Certificate further
agrees that it will report its interest in the CIA Investor Principal
Balance, with respect to all taxes, in a manner consistent with the
intended characterization referred to in Section 3.07 of the Agreement.
<PAGE>
Neither this Certificate nor any interest herein may be sold
conveyed, assigned, hypothecated, pledged, participated, or otherwise
transferred, except in accordance with the Agreement, and any such transfer
will be permitted only if it consists of a pro rata percentage interest in
all payments made with respect to this Certificate. No transfers of
partial interests in this Certificate shall be permitted.
Neither this Certificate nor any interest herein may be
transferred to any person, unless the transferee shall have executed and
delivered the certifications required by the Agreement and each of the
Transferor and the Servicer shall have granted its prior consent thereto.
Such consent shall be granted unless the Transferor determines in its sole
and absolute discretion that the proposed transfer would create a risk that
the Trust would be classified for federal or any applicable state tax
purposes as an association or publicly traded partnership taxable as a
corporation. Notwithstanding the foregoing, any attempted transfer of this
Certificate or an interest herein that would cause the aggregate number of
(i) holders of a right to receive interest or principal with respect to the
CIA Certificates (or other interests in the Trust), other than certificates
(or other such interests) with respect to which an opinion is rendered that
such certificates (or other such interests) will be treated as debt for
federal income tax purposes, and (ii) any holders of a right to receive any
amount in respect of the Transferor Interest, to exceed one hundred shall
be void.
The holder of this Certificate or any interest therein hereby
certifies that it is either (A)(i) a citizen or resident of the United
States, (ii) a corporation, partnership or other entity organized in or
under the laws of the United States or any political subdivision thereof
which, if a tax-exempt entity, recognizes that payments with respect to
this Certificate may constitute unrelated business taxable income or (iii)
a person not described in (i) or (ii) whose ownership of this Certificate
is effectively connected with the conduct of a trade or business within the
United States (within the meaning of the Code) and whose ownership of any
interest in this Certificate will not result in any withholding obligation
with respect to any payments with respect to this Certificate by any
person, or (B) an estate or trust the income of which is includible in
gross income for United States federal income tax purposes.
<PAGE>
If the holder hereof is a person described in clause (iii) above, it has
furnished to the Servicer and the Trustee, a properly executed United
States Internal Revenue Service Form 4224 and a new Form 4224, or any
successor applicable form, upon the expiration or obsolescence of any
previously delivered form, and comparable statements in accordance with
applicable United States laws.
<PAGE>
Unless the certificate of authentication hereon has been executed
by or on behalf of the Trustee, by manual signature, this Certificate shall
not be entitled to any benefit under the Agreement, or be valid for any
purpose.
IN WITNESS WHEREOF, the Transferor has caused this Certificate to
be duly executed on this 4th day of June, 1996.
FIRST USA BANK
By:____________________________
Name: Steven L. McDonald
Title: Senior Vice President
CERTIFICATE OF AUTHENTICATION
This is one of the CIA Certificates referred to in the within-
mentioned Pooling and Servicing Agreement.
THE BANK OF NEW YORK,
as Authenticating Agent
Date: June 4, 1996
By:__________________________
Name:
Title:
<PAGE>
EXHIBIT E
MONTHLY ALLOCATIONS AND PAYMENT INSTRUCTIONS AND
NOTIFICATION TO THE TRUSTEE
FIRST USA BANK
________________________________________________
FIRST USA CREDIT CARD MASTER TRUST, SERIES 1996-2
________________________________________________
Monthly Period:
to
Distribution Date:
Transfer Date:
The undersigned, a duly authorized representative of First USA Bank (the
"Bank") as Servicer, pursuant to the Pooling and Servicing Agreement dated as
of September 1, 1992 (the "Pooling and Servicing Agreement") and the Series
1996-2 Supplement dated June 4, 1996 (the "Supplement") by and between the Bank
and The Bank of New York (Delaware), as Trustee (the "Trustee"), does hereby
certify as follows:
I Capitalized terms used in this Certificate have their respective
meanings set forth in the Pooling and Servicing Agreement; provided,
that the preceding "Monthly Period" shall mean the Monthly Period
immediately preceding the calendar month in which this Certificate is
delivered. References herein to certain sections and subsections are
references to the respective sections and subsections of the Pooling
and Servicing Agreement. This Certificate is delivered pursuant to
Section 4.09 of the Pooling and Servicing Agreement.
II The Bank is Servicer under the Pooling and Servicing Agreement.
III The undersigned is a Servicing Officer.
IV The date of this notice is a Determination Date under the Pooling and
Servicing Agreement.
<PAGE>
I. INSTRUCTION TO MAKE A WITHDRAWAL.
---------------------------------
Pursuant to Section 4.09, the Servicer does hereby instruct the Trustee (i)
to make a withdrawal from the Finance Charge Account on the above
referenced Transfer Date under the Pooling and Servicing Agreement, in an
aggregate amount as set forth below in respect of the following amounts and
(ii) to apply the proceeds of such withdrawal in accordance with Section
4.05:
1. A. Class A Finance Charge Allocations
Principal Funding Investment Proceeds N/A
Reserve Account Withdrawals N/A
----------
Total Class A Available Funds
B. Pursuant to subsections 4.09(a)(i):
-----------------------------------
1. Interest to be paid to Certificateholders at the
Certificate Rate for the Interest Period on the
Invested Amount
(Actual/360)
Class A
2. Overdue Interest
3. Default Interest
C. Pursuant to subsection 4.09 (a)(ii):
------------------------------------
Class A Monthly Servicing Fee for the preceding
Monthly Period if First USA Bank is no longer Servicer
D. Pursuant to subsection 4.09(a)(iii):
------------------------------------
Class A Investor Default Amount for the preceding
Monthly Period
----------
E. Pursuant to subsection 4.09(a)(iv):
-----------------------------------
Amount constituting Excess Finance Charge Collections
to be distributed per subsection 4.13
==========
<PAGE>
2. A. Total Class B Finance Charge Allocations
B. Pursuant to subsections 4.09(b)(i):
-----------------------------------
1. Interest to be paid to Certificateholders at the
Certificate Rate for the Interest Period on the
Invested Amount
(Actual/360)
Class B
2. Overdue Interest
3. Default Interest
C. Pursuant to subsection 4.09 (b)(ii):
------------------------------------
Class B Monthly Servicing Fee for the preceding
Monthly Period if First USA Bank is no longer
Servicer
-----------
D. Pursuant to subsection 4.09(b)(iii):
------------------------------------
Amount constituting Excess Finance Charge Collections
distributed per subsection 4.13
===========
3. A. Total CIA Finance Charge Allocations
B. Pursuant to subsection 4.09 (c)(i):
-----------------------------------
CIA Monthly Servicing Fee for the preceding
Monthly Period if First USA Bank is no longer
Servicer
-----------
C. Pursuant to subsections 4.09(c)(ii):
------------------------------------
Amount constituting Excess Finance Charge Collections
to be distributed per subsection 4.13
===========
4. A. Pursuant to subsections 4.09(a)(iv), 4.09(b)(iii),
--------------------------------------------------
4.09(c)(ii) and 4.17(e):
------------------------
Amount constituting Excess Finance Charge Collections
to be distributed per subsection 4.13
Total Excess Finance Charge Collections
===========
<PAGE>
II. APPLICATION OF EXCESS FINANCE CHARGE COLLECTIONS
------------------------------------------------
Pursuant to Section 4.13, the Servicer hereby instructs the
Trustee to apply Excess Finance Charge Collections, determined
pursuant to the provisions of Section 4.09, in the following
priority:
A. Pursuant to subsection 4.13(a):
-------------------------------
The Class A Required Amount applied in accordance with
subsection 4.09(a)
B. Pursuant to subsection 4.13 (b):
--------------------------------
Amount of Class A Investor Charge-Offs
not previously reimbursed
C. Pursuant to subsection 4.13 (c):
--------------------------------
Amount equal to unpaid Class B Monthly Interest Due
on the Class B Outstanding Principal Balance
D. Pursuant to subsection 4.13 (d):
--------------------------------
Class B Investor Default Amount for the preceding
Monthly Period
E. Pursuant to subsection 4.13 (e):
--------------------------------
Reimbursement of Class B Invested Amount which has
been reduced for reasons other than principal payments
F. Pursuant to subsection 4.13 (f):
--------------------------------
1. CIA Monthly Interest for the preceding
Interest Period on the Invested
Amount (Actual/360)
2. Overdue Interest
3. CIA Default Interest -----------------
G. Pursuant to subsection 4.13 (g):
--------------------------------
<PAGE>
1. Unpaid Investor Monthly Servicing Fee for
the preceding Monthly Period to be paid to
First USA Bank
H. Pursuant to subsection 4.13 (h):
--------------------------------
CIA Investor Default Amount for the preceding
Monthly Period
I. Pursuant to subsection 4.13 (i):
--------------------------------
Reimbursement of CIA Invested Amount which has
been reduced for reasons other than principal
payments
J. Pursuant to subsection 4.13 (j):
--------------------------------
The excess, if any, of the Required Reserve Account
Amount over Available Reserve Account Amount to be
funded to the Reserve Account
K. Pursuant to subsection 4.13 (k):
--------------------------------
Remaining amount to be applied pursuant to
the Spread Account Agreement
----------------
Total (Excess F/C Collections from 4(A) above)
================
<PAGE>
III. APPLICATION OF PRINCIPAL COLLECTIONS
------------------------------------
Pursuant to Sections 4.05, 4.07, 4.09, 4.14 and 4.16, the Servicer hereby
instructs the Trustee to apply Principal Collections available on the
Transfer Date, determined pursuant to the provisions of the above sections,
in the following priority:
A. Principal Collections
---------------------
1. Class A Principal Collections
Class A Default Amount (during
Accumulation Period)
Class A Charge-Offs Amount (during
Accumulation Period)
----------------
Total Class A Monthly Principal
2. Class B Principal Collections
Class B Default Amount (during
Accumulation Period)
Class B Charge-Offs Amount (during
Accumulation Period)
----------------
Total Class B Monthly Principal
3. CIA Principal Collections
CIA Investor Default Amt (during
Accumulation Period)
CIA Investor Charge-Offs Amt
(during Accumulation)
----------------
Total CIA Monthly Principal
4. Excess Principal Collections
(other series)
----------------
Total Principal Collections
================
B. Allocation of Principal Collections
-----------------------------------
1. Amount of CIA Principal Reallocated
to F/C Account
2. Amount of Class B Principal Reallocated
to F/C Account
3. Amount of Investor Principal Collections
to other Series
4. Payment of principal to Class A
Certificateholders
5. Payment of principal to Class B
Certificateholders
6. Payment of principal to CIA
Certificateholders
7. Payment of principal to Principal
Funding Account
8. Amount returned to Bank
----------------
Total Principal Allocations
================
<PAGE>
(1) Investor Monthly Servicing Fee paid to First USA Bank
(2) Total Default Amounts paid to First USA Bank
(3) Excess Spread paid to Spread Account, then to First
USA Bank
(a) Interest on Spread Account Balance
(4) Monthly Principal Collections to First USA Bank
----------------
Total to First USA Bank
(5) Deposit to Spread Account (Excess Spread if not funded by
Spread Replacement Amount from Morgan)
(6) Deposit to Reserve Account
(7) Interest payment to Class A Certificateholders (DTC)
(8) Interest payment to Class B Certificateholders (DTC)
(9) Interest payment to CIA Certificateholders
(10) Certificate Principal to Principal Funding Account
(11) Principal to Certificateholders (DTC)
(12) Investor Principal Collections to other Series
(13) Monthly Principal Payment to CIA Certificateholders
(14) Excess Spread paid to and retained in Spread Account
----------------
Total Disbursements
================
Total Class A, B and C funds to be allocated
================
-------------------
Account to satisfy Cap Amount (funded by Morgan)
<PAGE>
EXHIBIT F
MONTHLY CERTIFICATEHOLDERS' STATEMENT
FIRST USA BANK
-------------------------------------------------
FIRST USA CREDIT CARD MASTER TRUST, SERIES 1996-2
-------------------------------------------------
Monthly Period: to
Distribution Date:
Transfer Date:
Under Section 5.02 of the Pooling and Servicing Agreement dated as of September
1, 1992 (the "Pooling and Servicing Agreement") by and between First USA Bank
(the "Bank") and The Bank of New York (Delaware), as trustee (the "Trustee") the
Bank, as Servicer, is required to prepare certain information each month
regarding current distributions to Certificateholders and the performance of the
First USA Credit Card Master Trust (the "Trust") during the previous month. The
information which is required to be prepared with respect to the Distribution
Date noted above and with respect to the performance of the Trust during the
month noted above is set forth below. Certain information is presented on the
basis of an original principal amount of $1,000 per Series 1996-2 Certificate (a
"Certificate"). Certain other information is presented based on the aggregate
amount for the Trust as a whole. Capitalized terms used in this Monthly
Certificateholders' Statement have their respective meanings set forth in the
Pooling and Servicing Agreement.
1. Information Regarding the Current Monthly Distribution.
-------------------------------------------------------
A. The total amount of the distribution to
Certificateholders on the Distribution Date per
$1,000 original certificate principal amount
Class A
Class B
CIA Inv. Amt.
----------------
Total (weighted avg.)
B. The amount of the distribution set forth in
paragraph 1 above in respect of interest on
the Certificates, per $1,000 original
certificate principal amount
<PAGE>
Class A
Class B
CIA Inv. Amt.
----------------
Total (weighted avg.)
C. The amount of the distribution set forth in paragraph
1 above in respect of principal on the Certificates,
per $1,000 original certificate principal amount
Class A
Class B
CIA Inv. Amt.
----------------
Total
================
2. Information Regarding the Performance of the Trust.
---------------------------------------------------
A. Allocation of Principal Receivables.
------------------------------------
The aggregate amount of Allocations of Principal
Receivables processed during the Monthly Period
which were allocated in respect of the
Certificates
Class A
Class B
CIA Inv. Amt.
----------------
Total
================
B. Allocation of Finance Charge Receivables.
-----------------------------------------
(a) The aggregate amount of Allocations of Finance
Charge Receivables processed during the Monthly
Period which were allocated in respect of the
Certificates
Class A
Class B
CIA Inv. Amt.
----------------
Total
================
(b) Principal Funding Investment Proceeds (to Class A) N/A
(c) Withdrawals from Reserve Account (to Class A) N/A
----------------
Class A Available Funds
================
<PAGE>
C. Principal Receivables / Investor Percentages
--------------------------------------------
(a) The aggregate amount of Principal Receivables in
the Trust as of the last day of the Monthly Period
(b) Invested Amount as of the last day of the preceding
month (Adjusted Class A Invested Amount during
Accumulation Period)
Class A
Class B
CIA Inv. Amt.
----------------
Total
(c) The Floating Allocation Percentage: The Invested
Amount set forth in paragraph 3(b) above as a
percentage of the aggregate amount of Principal
Receivables as of the Record Date set forth in
paragraph 3(a) above
Class A
Class B
CIA Inv. Amt.
----------------
Total
(d) During the Amortization Period: The Invested
Amount as of _______ (the last day of the
Revolving Period)
Class A N/A
Class B N/A
CIA Inv. Amt. N/A
----------------
Total N/A
(e) The Fixed/Floating Allocation Percentage: The
Invested Amount set forth in paragraph 3(d)
above as a percentage of the aggregate amount
of Principal Receivables set forth in paragraph
3(a) above
Class A N/A
Class B N/A
CIA Inv. Amt. N/A
----------------
Total N/A
<PAGE>
D. Delinquent Balances.
--------------------
The aggregate amount of outstanding balances in the
Accounts which were delinquent as of the end of the
day on the last day of the Monthly Period
(a) 35 - 64 days
(b) 65 - 94 days
(c) 95 - 124 days
(d) 125 - 154 days
(e) 155 - 184 days
(f) 185 or more days
----------------
Total
================
E. Monthly Investor Default Amount.
--------------------------------
(a) The aggregate amount of all defaulted Principal
Receivables written off as uncollectible during
the Monthly Period allocable to the Invested
Amount (the aggregate "Investor Default
Amount")
Class A
Class B
CIA Inv. Amt.
----------------
Total
================
F. Investor Charge-Offs & Reimbursements of Charge-Offs.
-----------------------------------------------------
(a) The aggregate amount of Class A Investor Charge-
Offs and the reductions in the Class B Invested
Amount and the CIA Invested Amount
Class A
Class B
CIA Inv. Amt.
----------------
Total
================
(b) The amounts set forth in paragraph 6(a) above,
per $1,000 original certificate principal amount
(which will have the effect of reducing, pro rata,
the amount of each Certificateholder's investment)
Class A
<PAGE>
Class B
CIA Inv. Amt.
----------------
Total
================
(c) The aggregate amount of Class A Investor Charge-
Offs reimbursed and the reimbursement of
reductions in the Class B Invested Amount and the
CIA Invested Amount
Class A
Class B
CIA Inv. Amt.
----------------
Total
================
(d) The amount set forth in paragraph 6(c) above, per
$1,000 interest (which will have the effect of
increasing, pro rata, the amount of each
Certificateholder's investment)
Class A
Class B
CIA Inv. Amt.
----------------
Total
================
G. Investor Servicing Fee.
-----------------------
(a) The amount of the Investor Monthly Servicing Fee
payable by the Trust to the Servicer for the
Monthly Period
Class A
Class B
CIA Inv. Amt.
----------------
Total
================
H. Reallocated Principal Collections
---------------------------------
The amount of Reallocated CIA and Class B
Principal Collections applied in respect of Interest
Shortfalls, Investor Default Amounts or Investor
Charge-Offs for the prior month.
<PAGE>
Class B
CIA Inv. Amt.
-------------
Total
=============
I. CIA Invested Amount
-------------------
(a) The amount of the CIA Invested Amount as of the
close of business on the related Distribution Date
after giving effect to withdrawals, deposits and
payments to be made in respect of the preceding
month
(b) The Required CIA Invested Amount as of the
close of business on the related Distribution Date
after giving effect to withdrawals, deposits and
payments to be made in respect of the preceding month
J. The Pool Factor.
----------------
The Pool Factor (which represents the ratio of the amount
of the Investor Interest on the last day of the Monthly
Period to the amount of the Investor Interest as of the
Closing Date). The amount of a Certificateholder's pro
rata share of the Investor Participation Amount can be
determined by multiplying the original denomination of
the holder's Certificate by the Pool Factor
Class A
Class B
-------------
Total (weighted avg.)
K. The Portfolio Yield
-------------------
The Portfolio Yield for the related Monthly Period
L. The Base Rate
-------------
The Base Rate for the related Monthly Period
3. Information Regarding the Principal Funding Account
---------------------------------------------------
A. Accumulation Period
-------------------
(a) Accumulation Period commencement date
(b) Accumulation Period length (months)
<PAGE>
(c) Accumulation Period Factor
(d) Required Accumulation Factor Number
(e) Controlled Accumulation Amount
(f) Minimum Payment Rate (last 12 months)
B. Principal Funding Account
-------------------------
Beginning Balance
Plus: Principal Collections for Related Monthly
Period from Principal Account
Plus: Interest on Principal Funding Account
Balance for Related Monthly Period N/A
Less: Withdrawals to Finance Charge Account N/A
Less: Withdrawals to Distribution Account
----------
Ending Balance
C. Accumulation Shortfall
----------------------
The Controlled Deposit Amount for the previous
Monthly Period N/A
Less: The amount deposited into the Principal Funding
Account for the Previous Monthly Period N/A
----------
Accumulation Shortfall N/A
==========
Aggregate Accumulation Shortfalls N/A
==========
D. Principal Funding Investment Shortfall
--------------------------------------
Covered Amount N/A
Less: Principal Funding Investment Proceeds N/A
----------
Principal Funding Investment Shortfall N/A
4. Information Regarding the Reserve Account
A. Required Reserve Account Analysis
<PAGE>
(a) Required Reserve Account Amount percentage
(0.5% of Class A Invested Amount or other amount
designated by Transferor)
(b) Required Reserve Account Amount ($)
(c) Required Reserve Account Balance after effect of
any transfers on the Related Transfer Date
(d) Reserve Draw Amount transferred to the Finance
Charge Account on the Related Transfer Date
B. Reserve Account Investment Proceeds
-----------------------------------
Reserve Account Investment Proceeds transferred to the
Finance Charge Account on the Related Transfer Date N/A
C. Withdrawals from the Reserve Account
------------------------------------
Total Withdrawals from the Reserve Account transferred
to the Finance Charge Account on the Related Transfer
Date (1(d) plus 2 above) N/A
D. The Portfolio Adjusted Yield
----------------------------
The Portfolio Adjusted Yield for the related Mthly Period
<PAGE>
EXHIBIT G
[DATE]
First USA Bank
201 North Walnut Street
Wilmington, Delaware 19801
The Bank of New York (Delaware)
White Clay Center
Route 273
Newark, Delaware 19711
Re: CIA Certificates, Series 1996-2
----------------------------------------------------
Ladies and Gentlemen:
In connection with our proposed purchase of $_________ in principal
amount of First USA Credit Card Master Trust, CIA Certificates, Series
1996-2 (the "CIA Certificates"), we confirm that:
1. We have received a copy of the Private Placement Memorandum dated
May 22, 1996 relating to the CIA Certificates (the "Private Placement
Memorandum") and such other information as we deem necessary in order to
make our investment decision. We understand that the Private Placement
Memorandum and any such other information speaks only as of its date and
that the information contained in the Private Placement Memorandum and such
other information may not be correct or complete as of any time subsequent
to such date.
2. We agree to be bound by the restrictions and conditions set forth
in the Pooling and Servicing Agreement, dated as of September 1, 1992, as
supplemented by the Series 1996-2 Supplement dated as of June 4, 1996 (the
"Series 1996-2 Supplement" and together with the Pooling and Servicing
Agreement, the "Pooling and Servicing Agreement"), each by and between
First USA Bank, as transferor and servicer, and The Bank of New York
(Delaware)(as successor to The Bank of New York as successor to
NationsBank, N.A.) relating to the CIA Certificates and agree to be bound
by, and not reoffer, resell, pledge
<PAGE>
or otherwise transfer (any such act, a "Transfer") the CIA Certificates
except in compliance with, such restrictions and conditions including but
not limited to those in Section 11 of the Series 1996-2 Supplement.
3. We understand that the CIA Certificates have not been and will
not be registered under the Securities Act of 1933, as amended (the
"Securities Act") or any state securities law and agree that the CIA
Certificates may be reoffered, resold, pledged or otherwise transferred
only in compliance with the Securities Act and other applicable laws and
only (i) to the Transferor, (ii) to a limited number of institutional
"accredited investors" (as defined in Rule 501(a)(1), (2), (3) or (7) under
the Securities Act) and in a transaction exempt from the registration
requirements of the Securities Act (upon delivery of the documentation
required by the Pooling and Servicing Agreement and, if the Trustee so
requires, an opinion of counsel satisfactory to the Trustee) or (iii)
pursuant to Rule 144A under the Securities Act to a person that we
reasonably believe is a qualified institutional buyer within the meaning of
Rule 144A ("QIB") purchasing for its own account or a QIB purchasing for
the account of a QIB, whom we have informed, in each case, that the
reoffer, resale, pledge or other transfer is being made in reliance on Rule
144A.
4. We have neither acquired nor will we Transfer any CIA Certificate
we acquire (or any interest therein) or cause any CIA Certificate (or any
interest therein) to be marketed on or through (i) an "established
securities market" within the meaning of Section 7704(b)(1) of the Internal
Revenue Code of 1986, as amended (the "Code") and any treasury regulation
thereunder, including, without limitation, an over-the-counter-market or an
interdealer quotation system that regularly disseminates firm buy or sell
quotations or (ii) a "secondary market" within the meaning of Section
7704(b)(2) of the Code and any treasury regulation thereunder, including a
market wherein interests in the CIA Certificates are regularly quoted by
any Person making a market in such interests and a market wherein any
person regularly makes available bid or offer quotes with respect to
interests in the CIA Certificates and stands ready to effect buy or sell
transactions at the quoted prices for itself or on behalf of others.
<PAGE>
5. We are not and will not become a partnership, Subchapter S
corporation or grantor trust for United States federal income tax purposes.
[If this representation cannot be made, the Transferor, the Servicer or the
Trustee may require additional representations.]
6. We are a person who is either (A)(i) a citizen or resident of the
United States, (ii) a corporation or other entity organized in or under the
laws of the United States or any political subdivision thereof or (iii) a
person not described in (i) or (ii) whose ownership of the CIA Certificates
is effectively connected with a such person's conduct of a trade or
business within the United States (within the meaning of the Code) and our
ownership of any interest in a CIA Certificate will not result in any
withholding obligation with respect to any payments with respect to the CIA
Certificates by any person or (B) an estate or trust the income of which
is includible in gross income for United States federal income tax
purposes. We agree that if we are a person described in clause (A)(iii)
above, we will furnish to the person from whom we are acquiring a CIA
Certificate, the Servicer and the Trustee, a properly executed U.S.
Internal Revenue Service Form 4224 and a new Form 4224, or any successor
applicable form, upon the expiration or obsolescence of any previously
delivered form (and such other certifications, representations or opinions
of counsel as may be requested by the Transferor, the Servicer or the
Trustee). We recognize that if we are a tax-exempt entity, payments with
respect to the CIA Certificates may constitute unrelated business taxable
income.
7. We understand that no subsequent Transfer of a CIA Certificate is
permitted unless (i) such Transfer is of a CIA Certificate with a
denomination of at least $1,000,000 and (ii) the Transferor and the
Servicer each consent in writing to the proposed Transfer, which consent
shall be granted unless either the Transferor or the Servicer determines in
its sole and absolute discretion that such Transfer would create a risk
that the Trust would be classified for federal or any applicable state tax
purposes as an association or publicly traded partnership taxable as a
corporation; provided, that any attempted Transfer that would cause the
--------
number of Targeted Holders (as defined in the CIA Purchase Agreement) to
exceed one hundred shall be void; and provided, further, that there shall
-------- -------
not at any time be more than 10 CIA
<PAGE>
Certificateholders or such other number as may be consented to by the
Transferor which consent may be withheld in its sole and absolute
discretion.
8. We understand that the opinion of tax counsel that the Trust is
not a publicly traded partnership taxable as a corporation is dependent in
part on the accuracy of the representations in paragraphs 4, 5, 6 and 7 and
that in addition to our being subject to having our purchase rescinded, we
will be liable for damages.
9. We are [an institutional "accredited investor" (as defined in Rule
501(a)(1), (2), (3), or (7) of Regulation D under the Securities Act) and
have such knowledge and experience in financial and business matters as to
be capable of evaluating the merits and risks of our investment in the CIA
Certificates, and we and any account for which we are acting are each able
to bear the economic risk of our or its investment] or [a "qualified
institutional buyer" (as defined in Rule 144A under the Securities Act)
purchasing for our own account or for the account of a "qualified
institutional buyer"and we understand that the sale to us is being made in
reliance on Rule 144A under the Securities Act].
10. We are acquiring each of the CIA Certificates purchased by us for
our own account or for a single account (each of which is an institutional
"accredited investor") as to which we exercise sole investment discretion.
11. We are not (i) an employee benefit plan (as defined in Section
3(3) of the Employee Retirement Income Security Act of 1974, as amended
("ERISA") that is subject to the provisions of Title I of ERISA, (ii) a
plan described in Section 4975(e)(1) of the Internal Revenue Code of 1986,
as amended, (iii) a governmental plan, as defined in Section 3(32) of
ERISA, subject to any federal, state or local law which is, to a material
extent, similar to the provisions of Section 406 of ERISA or Section 4975
of the Code [(any of the plans described in clauses (i) through (ii), a
"Plan")], (iv) an entity whose underlying assets include plan assets by
reason of a plan's investment in the entity or (v) a person investing "plan
assets" of any such plan (excluding for purposes of this clause (v) any
entity registered under the Investment Company Act of 1940, as amended).
[The brack-
<PAGE>
eted language in clause (iii) need only be included if a purchaser cannot
give both of the representations contained in clauses (iv) and (v).] [If
the representations contained in either clause (iv) or clause (v) above
cannot be given, a purchaser will be required to give the representations
set forth in clauses (i) through (iii) above (including the bracketed
language), the representation in (iv) or (v) (whichever can be given) and
also will be required to represent that it is either an entity specified in
clause (iv) or (v) and that it understands that at no time may the
aggregate percentage of the CIA Invested Amount Transferred to Plan
Purchasers exceed 25% of the CIA Invested Amount, such representation to
read substantially as follows, with the appropriate bracketed language
deleted: "We are [an entity whose underlying assets include "plan assets"
by reason of a Plan's investment in the entity][a person investing "plan
assets" of any such Plan (excluding any entity registered under the
Investment Company Act of 1940, as amended)] and we understand that at no
time shall the aggregate percentage of the CIA Invested Amount Transferred
to Plan Purchasers exceed 25% of the CIA Invested Amount."]
12. We understand that any purported Transfer of any CIA Certificate
in contravention of the restrictions and conditions in paragraphs 1 through
11 above (including any violation of the representation in paragraph 5 by
an investor who continues to hold a CIA Certificate occurring any time
after the Transfer in which it acquired such CIA Certificate) shall be null
and void and the purported transferee shall not be recognized by the Trust
or any other person as a CIA Certificateholder for any purpose.
13. We further understand that, on any proposed resale, pledge or
transfer of any CIA Certificates, we will be required to furnish to the
Trustee and the Registrar, such certification and other information as the
Trustee or the Registrar may reasonably require to confirm that the
proposed sale complies with the foregoing restrictions and with the
restrictions and conditions of the CIA Certificates and the Pooling and
Servicing Agreement pursuant to which the CIA Certificates were issued and
we agree that if we determine to Transfer any CIA Certificate, we will
cause our proposed transferee to provide the Transferor, the Servicer and
the Trustee with a letter substantially in the form of this letter. We
<PAGE>
further understand that CIA Certificates purchased by us will bear a legend
to the foregoing effect.
You are entitled to rely upon this letter and are irrevocably
authorized to produce this letter or a copy hereof to any interested party
in any administrative or legal proceeding or official inquiry with respect
to the matters covered hereby.
Very truly yours,
[NAME OF TRANSFEREE]
By:________________________
Name:
Title:
