<PAGE>
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-K
|X| ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 1998
OR
| | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to ______
Commission File Nos. 33-47812; 33-49106; 33-67502; 33-81634; 333-51045;
000-21424; 000-21424-01
American Express Master Trust
(Issuer of Certificates)
American Express Receivables Financing Corporation
Co-Originator of the Trust and a Transferor
-------------------------------------------
(Exact name of registrant as specified in its charter)
Delaware 13-3632012
- ---------------------------- ----------
(State or other jurisdiction (I.R.S. Employer
of incorporation) Identification No.)
200 Vesey Street, New York, New York 10285
- ------------------------------------ -----
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (212) 640-5582
American Express Centurion Bank
Co-Originator of the Trust and a Transferor
-------------------------------------------
(Exact name of registrant as specified in its charter)
Utah 11-2869525
- ---------------------------- ----------
(State or other jurisdiction (I.R.S. Employer
of incorporation) Identification No.)
6985 Union Park Center, Midvale, Utah 84047
- ------------------------------------- -----
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code (801) 565-5000
Securities registered pursuant to Section 12(b) of the Act: NONE
Securities registered pursuant to Section 12(g) of the Act:
the 6.60% Class A Accounts Receivable Trust Certificates, Series 1992-2,
the 5.375% Class A Accounts Receivable Trust Certificates, Series 1993-1,
the 7.60% Class A Accounts Receivable Trust Certificates, Series 1994-2,
the 7.85% Class A Accounts Receivable Trust Certificates, Series 1994-3,
the Class A Floating Rate Accounts Receivable Trust Certificates, Series 1996-1,
the Class A Floating Rate Accounts Receivable Trust Certificates, Series 1996-2,
and the 5.90% Class A Accounts Receivable Trust Certificates, Series 1998-1
Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports) and (2) has been subject to such filing
requirements for the past 90 days. Yes x No
Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K is not contained herein and will not be contained, to the best
of the registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. Not applicable.
State the aggregate market value of the voting stock held by non-affiliates of
the registrant: Not applicable.
Documents Incorporated By Reference: NONE
-----------------------------------------
<PAGE>
PART I
Item 1. Business
The American Express Master Trust (the "Trust") was formed pursuant to a
Master Pooling and Servicing Agreement, dated as of June 30, 1992, which was
amended by the Amended and Restated Master Pooling and Servicing Agreement,
dated as of May 1, 1998 (the "Agreement"), among American Express Receivables
Financing Corporation and American Express Centurion Bank, as transferors (the
"Transferors"), American Express Travel Related Services Company, Inc. as
servicer (the "Servicer"), and The Bank of New York, as trustee (the "Trustee").
American Express Centurion Bank was added as a transferor in May 1998. American
Express Receivables Financing Corporation ("RFC"), a Delaware corporation, is a
wholly owned subsidiary of American Express Travel Related Services Company,
Inc. ("TRS"). It was incorporated on July 30, 1991. Its principal executive
offices are located at 200 Vesey Street, New York, New York. TRS is a wholly
owned subsidiary of American Express Company ("American Express"). It was
incorporated in the state of New York on May 3, 1982 and its principal executive
offices are located at 200 Vesey Street, New York, New York. American Express
Centurion Bank was incorporated under Delaware banking laws as a limited service
bank in 1985. As of July 1, 1996, its business was combined by merger with
another subsidiary of TRS that is a Utah-chartered, FDIC-insured industrial loan
company. The surviving institution was renamed as American Express Centurion
Bank ("Centurion"). Its principal executive offices are located at 6985 Union
Park Center, Midvale, Utah.
The Trust was formed for the purpose of acquiring and holding the Trust
Assets (defined below) and from time to time issuing asset-backed certificates
(the "Certificates") under the Agreement and one or more supplements thereto
(each, a "Supplement"), including issuing and selling certain Certificates to
investors in underwritten public offerings and private placements ("Investor
Certificates"). Each Certificate represents an undivided interest in the Trust
and the right to receive payments of interest at a specified rate and payments
of principal at certain times during the term of the Trust. Each series of
Investor Certificates (each, a "Series") will have its own Supplement to govern
the individual terms and allocations applicable to such Series.
The property of the Trust (the "Trust Assets") includes a portfolio of
receivables (the "Receivables") generated from time to time in a portfolio of
American ExpressR Card, American ExpressR Gold Card and Platinum CardR accounts
(collectively, the "Accounts") owned by TRS or Centurion, all monies due or to
become due in payment of the Receivables, all proceeds of such Receivables and
any Series Enhancement provided for any particular Series or class of
Certificates. "Series Enhancement" may include, with respect to any Series or
class of Certificates, the subordination of one or more classes or Series of
Certificates to one or more other classes or Series of Certificates, a letter of
credit, a cash collateral guaranty, a cash collateral account, a surety bond, a
collateral interest, a spread account, a guaranteed rate agreement, a maturity
liquidity facility, a tax protection agreement or an insurance policy. The
Certificates do not represent obligations of or interests in RFC, Centurion or
TRS.
TRS and Centurion do not act as guarantors with respect to any payments on
the Certificates, and neither the Trustee nor the holders of the Certificates
will have general recourse against any of TRS, RFC or Centurion or their
respective assets. Instead, the Trustee's and the Certificateholders' only
recourse in any action seeking to collect amounts owing under the Certificates
will be against, and limited to, the Trust Assets.
The Agreement governs the allocation of collections in respect of the
Receivables. Payments received on the Trust's Assets are allocated among the
different Series (and within a Series among the different classes of
Certificates within a Series) and the interest of RFC and Centurion, as
transferors, all as set forth in the Agreement and Supplements.
2
<PAGE>
The Trust does not engage in any business activity other than acquiring and
holding the Trust Assets, issuing Certificates, making payments thereon and
related activities. Pursuant to the Agreement, the Trustee will hold the Trust
Assets in trust for the benefit of the holders of the Certificates, and TRS or
any successor servicer, as the Servicer, will be responsible for the
administration and servicing of the Receivables. The Trust has issued nine
Series of Certificates, of which seven are outstanding. The 7.15% Class A
Accounts Receivable Trust Certificates, Series 1994-1, were paid in full
September 15, 1998.
Information concerning the performance of the Trust Assets for each monthly
due period of the Trust is contained in monthly Servicer's reports provided to
the Trustee and filed monthly on Form 8-K, and information concerning
distributions made on the Investor Certificates is contained in payment date
statements prepared by the Servicer and also filed on Form 8-K. The Servicer has
prepared a report that sets forth, with respect to certain of the items reported
on monthly in the monthly Servicer's reports, the aggregate amount of such items
for the full year 1998 or, as applicable, the amount of such items as at
December 28, 1998. This annual report is filed herewith as Exhibit 99.3.
Item 2. Properties.
See Exhibit 99.3.
Item 3. Legal Proceedings.
The Registrant knows of no material pending legal proceedings with respect
to the Trust, involving the Trust, the Trust Assets, RFC, Centurion, the Trustee
or TRS, exclusive of ordinary routine litigation incidental to the duties of
TRS, RFC, Centurion or the Servicer under the Agreement.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
PART II
Item 5. Market for Registrant's Common Equity and Related Stockholder Matters.
(a) To the best knowledge of the Registrant, there is no established public
trading market for the Certificates.
(b) The Investor Certificates, representing investor's interests in the
Trust, are represented by certificates registered in the name of Cede & Co., the
nominee of The Depository Trust Company ("DTC").
(c) Not applicable.
Item 6. Selected Financial Data.
Not applicable.
3
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Item 7. Management's Discussion and Analysis of Financial Condition and Results
of Operations.
Year 2000
The Year 2000 ("Y2K") issue is the result of computer programs having been
written using two digits rather than four to define a year. Any programs that
have time-sensitive software may recognize a date using "00" as the year 1900
rather than 2000. American Express has conducted a comprehensive review of its
computer systems and business processes (including systems and processes of RFC
and Centurion) to identify the major systems that could be affected by the Y2K
issue. Steps are being taken by American Express to resolve any potential
problems including modifications to existing software and the purchase of new
software. These measures are scheduled to be completed and tested on a timely
basis. American Express' goals are to complete testing of critical systems by
early 1999 and to continue compliance efforts, including but not limited to, the
testing of systems on an integrated basis and independent validation of such
testing, through 1999.** The costs related to the Y2K issue, which are expensed
by American Express as incurred have not had, nor are they expected to have a
material impact on RFC's or Centurion's results of operations or financial
condition.** For further discussion of American Express' addresing of the Y2K
issue, please see pages 22 and 23 of American Express' 1998 Annual Report to
Shareholders, which discussion is incorporated herein by reference.
Various statements in this Y2K discussion marked with two asterisks (**),
are forward-looking statements which are subject to risks and uncertainties.
Important factors that could cause results to differ materially from these
forward-looking statments include, among other things, the ability of RFC,
Centurion and American Express to successfully identify systems containing
two-digit codes, the nature and amount of programming required to fix the
affected systems, the costs of labor and consultants related to such efforts,
the continued availability of such resources, and the ability of third parties
that interface with RFC, Centurion and American Express to successfully address
their Y2K issues.
Item 7a. Quantitative and Qualitative Disclosures About Market Risk.
Not applicable.
Item 8. Financial Statements and Supplementary Data.
See Exhibit 99.3.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
None.
PART III
Item 10. Directors and Executive Officers of the Registrant.
Not applicable.
Item 11. Executive Compensation.
Not applicable.
4
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Item 12. Security Ownership of Certain Beneficial Owners and Management.
(a) The Investor Certificates were delivered in book-entry form through the
facilities of DTC. As a consequence, the sole registered holder of Investor
Certificates is Cede & Co., the nominee of DTC. An investor holding an interest
in the Trust is not entitled to receive a certificate representing such interest
except in limited circumstances. Cede & Co. holds the Investor Certificates on
behalf of brokers, dealers, banks and other direct participants in the DTC
system. DTC participants may own Investor Certificates for their own account or
hold them for the accounts of their customers. As of January 22, 1999 the
following DTC participants held positions in Investor Certificates representing
interests in the Trust equal to or exceeding 5% of the total principal amount of
the Investor Certificates of the relevant class of each Series outstanding on
that date:
<TABLE>
<CAPTION>
Principal Amount
Name of Certificates Percent of Class
---- --------------- ----------------
<S> <C> <C>
Class A Accounts
Receivable Trust
Certificates,
Series 1992-2:
The Bank of New York $ 82,445,000 16.5%
Bankers Trust Company $ 71,732,000 14.3%
Chase Manhattan Bank $ 129,251,000 25.9%
Citibank, N.A. $ 27,390,000 5.5%
Norwest Bank $ 50,000,000 10.0%
Northern Trust Company $ 26,741,000 5.3%
Class A Accounts
Receivable Trust
Certificates,
Series 1993-1:
The Bank of New York $ 70,752,000 11.8%
Bankers Trust Company $ 55,793,418 9.3%
Boston Safe Deposit & $ 69,067,453 11.5%
Trust Company
Chase Manhattan Bank $ 109,260,000 18.2%
Citibank, N.A. $ 56,063,000 9.3%
State Street Bank and Trust $ 75,365,000 12.6%
Company
5
<PAGE>
Principal Amount
Name of Certificates Percent of Class
---- --------------- ----------------
Class A Accounts
Receivable Trust
Certificates,
Series 1994-2:
The Bank of New York $ 35,085,000 11.7%
Bankers Trust Company $ 60,540,000 20.2%
Chase Manhattan Bank $ 30,965,000 10.3%
Citibank, N.A. $ 29,000,000 9.7%
First Union National Bank- $ 37,100,000 12.4%
Philadelphia
Northern Trust Company $ 16,590,000 5.5%
State Street Bank and Trust $ 44,270,000 14.8%
Company
Class A Accounts
Receivable Trust
Certificates,
Series 1994-3:
The Bank of New York $ 36,709,000 12.2%
Bankers Trust Company $ 25,468,000 8.5%
Chase Manhattan Bank $ 47,836,000 15.9%
Fifth Third Bank/State $ 31,675,000 10.6%
Teachers Retirement of Ohio
Investors Fiduciary Trust $ 23,000,000 7.7%
Company
State Street Bank and Trust $ 20,700,000 6.9%
Company
Class A Floating
Rate Accounts
Receivable Trust
Certificates,
Series 1996-1:
The Bank of New York $104,026,000 10.9%
Chase Manhattan Bank $ 97,910,000 10.3%
Citibank, N.A. $249,000,000 26.2%
State Street Bank and Trust $219,000,000 23.1%
Company
Warburg Dillon Read LLC $116,500,000 12.3%
6
<PAGE>
Principal Amount
Name of Certificates Percent of Class
---- --------------- ----------------
Class A Floating
Rate Accounts
Receivable Trust
Certificates,
Series 1996-2:
The Bank of New York $ 96,025,000 32.0%
Bankers Trust Company $ 61,990,000 20.7%
Citibank, N.A. $ 88,905,000 29.6%
Class A Accounts
Receivable Trust
Certificates,
Series 1998-1
The Bank of New York $128,737,000 12.9%
Bankers Trust Company $301,231,000 30.1%
Chase Manhattan Bank $144,036,000 14.4%
State Street Bank and Trust $ 90,573,000 9.1%
Company
</TABLE>
The address of each of the above participants is:
c/o The Depository Trust Company
55 Water Street
New York, New York 10041
(b) Not applicable.
(c) Not applicable.
Item 13. Certain Relationships and Related Transactions.
The Bank of New York acts as Trustee under the Agreement.
7
<PAGE>
PART IV
Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
(a) Financial Statements:
1. Annual Servicing Statement Delivered to the Trustee (filed as
Exhibit 99.1).
2. Annual Accountant's Report of Ernst & Young LLP (filed as
Exhibit 99.2).
3. Annual Report containing Aggregate Information for the Fiscal Year
(filed as Exhibit 99.3).
(b) Reports on Form 8-K:
The Trust has filed the following reports on Form 8-K for the monthly
due periods and other items occurring since January 1, 1998:
1. Form 8-K, dated February 17, 1998, attaching the Monthly
Servicer's Certificate for the due period January 1, 1998
through January 31, 1998.
2. Form 8-K, dated March 16, 1998, attaching the Monthly
Servicer's Certificate for the due period February 1, 1998
through February 28, 1998.
3. Form 8-K, dated April 15, 1998, attaching the Monthly
Servicer's Certificate for the due period March 1, 1998
through March 31, 1998.
4. Form 8-K, dated May 15, 1998, attaching the Monthly
Servicer's Certificate for the due period April 1, 1998
through April 30, 1998.
5. Form 8-K, dated May 27, 1998, attaching the Amended and
Restated Master Pooling and Servicing Agreement, dated as of
May 1, 1998 and the Series 1998-1 Supplement, dated as of
May 27, 1998.
6. Form 8-K, dated June 15, 1998, attaching the Monthly
Servicer's Certificate for the due period May 1, 1998
through May 27, 1998.
7. Form 8-K, dated July 15, 1998, attaching the Monthly
Servicer's Certificate for the due period May 28, 1998
through June 26, 1998.
8. Form 8-K, dated August 17, 1998, attaching the Monthly
Servicer's Certificate for the due period June 27, 1998
through July 27, 1998.
9. Form 8-K, dated September 15, 1998, attaching the Monthly
Servicer's Certificate for the due period July 28, 1998
through August 27, 1998.
10. Form 8-K, dated October 15, 1998, attaching the Monthly
Servicer's Certificate for the due period August 28, 1998
through September 27, 1998.
8
<PAGE>
11. Form 8-K/A, dated October 16, 1998, attaching the Monthly
Servicer's Certificate for the due period August 28, 1998
through September 27, 1998.
12. Form 8-K, dated November 16, 1998, attaching the Monthly
Servicer's Certificate for the due period September 28, 1998
through October 27, 1998.
13. Form 8-K, dated December 15, 1998, attaching the Monthly
Servicer's Certificate for the due period October 28, 1998
through November 27, 1998.
14. Form 8-K, dated January 15, 1999, attaching the Monthly
Servicer's Certificate for the due period November 28, 1998
through December 28, 1998.
15. Form 8-K, dated February 12, 1999, attaching the Monthly
Servicer's Certificate for the due period December 29, 1998
through January 27, 1999.
16. Form 8-K, dated March 15, 1999, attaching the Monthly
Servicer's Certificate for the due period January 29, 1999
through February 26, 1999.
(c) Exhibits:
4.1 Master Pooling and Servicing Agreement, dated as of June 30,
1992, among American Express Receivables Financing
Corporation, as Transferor, American Express Travel Related
Services Company, Inc., as Servicer, and The Bank of New
York, as Trustee (incorporated by reference to Exhibit 1
of Form 8-K of the registrant dated August 3, 1992, File No.
33-49106).
4.2 Amendment No. 1 to Master Pooling and Servicing Agreement,
dated as of September 8, 1993, among American Express
Receivables Financing Corporation, as Transferor, American
Express Travel Related Services Company, Inc., as Servicer,
and The Bank of New York, as Trustee (incorporated by
reference to Exhibit 1.2 of Form 8-A of the registrant dated
October 15, 1996, File No. 33-49106).
4.3 Amendment No. 2 to Master Pooling and Servicing Agreement,
dated as of July 15, 1994, among American Express
Receivables Financing Corporation, as Transferor, American
Express Travel Related Services Company, Inc., as Servicer,
and The Bank of New York, as Trustee (incorporated by
reference to Exhibit 2 of Form 8-K of the registrant dated
July 15, 1994, File No. 33-49106).
4.4 Amendment No. 3 to Master Pooling and Servicing Agreement,
dated as of September 12, 1994, among American Express
Receivables Financing Corporation, as Transferor, American
Express Travel Related Services Company, Inc., as Servicer,
and The Bank of New York, as Trustee (incorporated by
reference to Exhibit 2 of Form 8-K of the registrant dated
September 12, 1994, File No. 33-49106).
4.5 Amendment No. 4 to Master Pooling and Servicing Agreement,
dated as of January 17, 1996, among American Express
Receivables Financing Corporation, as Transferor, American
Express Travel Related Services Company, Inc., as Servicer,
and The Bank of New York, as Trustee (incorporated by
reference to Exhibit 2 of Form 8-K of the registrant dated
January 17, 1996, File No. 33-49106).
9
<PAGE>
4.6 Amendment No. 5 to Master Pooling and Servicing Agreement,
dated as of March 27, 1997, among American Express
Receivables Financing Corporation, as Transferor, American
Express Travel Related Services Company, Inc., as Servicer,
and The Bank of New York, as Trustee (incorporated by
reference to Exhibit 4.6 of Form 10-K of the registrant
dated March 26, 1998, File Nos. 33-47812, 33-49106,
33-67502 and 33-81634).
4.7 Amended and Restated Master Pooling and Servicing Agreement,
dated as of May 1, 1998, among American Express Receivables
Financing Corporation and American Express Centurion Bank as
Transferors, American Express Travel Related Services
Company, Inc., as Servicer, and The Bank of New York, as
Trustee (incorporated by reference to Exhibit 4.1 of Form
8-K of the registrants dated May 27, 1998, File Nos.
33-47812, 33-49106, 33-67502, 33-81634, 333-51045, 000-21424
and 000-21424-01).
4.8 Series 1992-2 Supplement, dated as of August 3, 1992,
to Master Pooling and Servicing Agreement (incorporated by
reference to Exhibit 2 of Form 8-K of the registrant dated
August 3, 1992, File No. 33-47812).
4.9 Series 1993-1 Supplement, dated as of September 1, 1993, to
Master Pooling and Servicing Agreement (incorporated by
reference to Exhibit 2 of Form 8-K of the registrant dated
September 22, 1993, File No. 33-47812).
4.10 Series 1994-2 Supplement, dated as of September 1, 1994, to
Master Pooling and Servicing Agreement (incorporated by
reference to Exhibit 6 of Form 8-K of the registrant dated
September 12, 1994, File No. 33-47812).
4.11 Series 1994-3 Supplement, dated as of September 1, 1994, to
Master Pooling and Servicing Agreement (incorporated by
reference to Exhibit 7 of Form 8-K of the registrant dated
September 12, 1994, File No. 33-47812).
4.12 Series 1996-1 Supplement, dated as of September 18, 1996, to
Master Pooling and Servicing Agreement (incorporated by
reference to Exhibit 20.1 of Form 8-K of the registrant
dated September 18, 1996, File No. 33-47812).
4.13 Series 1996-2 Supplement, dated as of September 18, 1996, to
Master Pooling and Servicing Agreement (incorporated by
reference to Exhibit 20.2 of Form 8-K of the registrant
dated September 18, 1996, File No. 33-47812).
4.14 Series 1998-1 Supplement, dated as of May 27, 1998, to the
Amended and Restated Master Pooling and Servicing Agreement,
dated as of May 1, 1998 (incorporated by reference to
Exhibit 4.2 of Form 8-K of the registrants dated May 27,
1998, File Nos. 33-47812, 33-49106, 33-67502, 33-81634,
333-51045, 000-21424 and 000-21424-01).
10.1 Receivable Purchase Agreement, dated as of June 30, 1992,
between American Express Receivables Financing Corporation,
as purchaser, and American Express Travel Related Services
Company, Inc., as seller (incorporated by reference to
Exhibit 4(b) to the Registration Statement filed on behalf
of American Express Master Trust, Series 1992-1, File No.
33-47812).
10
<PAGE>
10.2 Amendment No. 1 to Receivable Purchase Agreement, dated as
of September 12, 1994, between American Express Receivables
Financing Corporation, as purchaser, and American Express
Travel Related Services Company, Inc., as seller
(incorporated by reference to Exhibit 4 of Form 8-K of the
registrant dated September 12, 1994, File No. 33-47812).
10.3 Amendment No. 2 to Receivable Purchase Agreement, dated as
of August 7, 1997, between American Express Receivables
Financing Corporation, as purchaser, and American Express
Travel Related Services Company, Inc., as seller
(incorporated by reference to Exhibit 20.3 of Form 8-K of
the registrant dated August 14, 1997, File No. 33-47812).
24.1 Power of Attorney for RFC.
24.2 Power of Attorney for Centurion.
99.1 Annual Servicing Statement Delivered to the Trustee.
99.2 Annual Accountant's Report of Ernst & Young LLP.
99.3 Annual Report Containing Aggregated Information for the Fiscal
Year.
99.4 Pages 22 through 23 of American Express Company's 1998 Annual
Report to Shareholders, discussing Year 2000.
11
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
AMERICAN EXPRESS MASTER TRUST
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION,
Co-Originator of the
American Express Master Trust
By: /s/ Leslie R. Scharfstein
-------------------------
Leslie R. Scharfstein
President
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed by the following persons in the capacities
indicated.
Signature Title
*
- ------------------------
Richard K. Goeltz Director
*
- ------------------------
Vincent P. Lisanke Director
*
- ------------------------
Jay B. Stevelman Director
*
- ------------------------
Leslie R. Scharfstein President
(Principal Executive Officer)
*
- ------------------------
John D. Koslow Vice President and Treasurer
(Principal Finance Officer and
Principal Accounting Officer)
*By: /s/ Leslie R. Scharfstein
-------------------------
Leslie R. Scharfstein
Attorney-in-Fact
Dated: March 29, 1999
12
<PAGE>
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) 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.
AMERICAN EXPRESS MASTER TRUST
AMERICAN EXPRESS CENTURION
BANK,
Co-originator of the
American Express Master Trust
By: /s/ Rhonda Halpern
--------------------------
Rhonda Halpern
Chief Financial Officer,
Treasurer and
Chief Compliance Officer
Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed by the following persons in the capacities
indicated.
Signature Title
/s/ Frank L. Skillern
- ------------------------
Frank L. Skillern Director and Chairman
*
- ------------------------
David E.Poulsen Director, President and Chief Executive
Officer
*
- ------------------------
Gilbert E. Ahye Director
*
- ------------------------
Maria J. Garciaz Director
*
- ------------------------
Ash Gupta Director
*
- ------------------------
Peter A. Lefferts Director
*
- ------------------------
Raymond Pettit Director
*
- ------------------------
Rosalyn M. Watson Director
*
- ------------------------
James F. Welch Director
*By: /s/ Robert D. Kraus
-----------------------
Robert D. Kraus
Attorney-in-Fact
Dated: March 29, 1999
13
<PAGE>
EXHIBIT INDEX
The following exhibits are filed as part of this Annual Report or, where
indicated, were heretofore filed and are hereby incorporated by reference
(*indicates exhibits electronically filed herewith).
Description
4.1 Master Pooling and Servicing Agreement, dated as of June 30, 1992,
among American Express Receivables Financing Corporation, as
Transferor, American Express Travel Related Services Company, Inc.,
as Servicer, and The Bank of New York, as Trustee (incorporated
by reference to Exhibit 1 of Form 8-K of the registrant dated August
3, 1992, File No. 33-49106).
4.2 Amendment No. 1 to Master Pooling and Servicing Agreement, dated as
of September 8, 1993, among American Express Receivables Financing
Corporation, as Transferor, American Express Travel Related Services
Company, Inc., as Servicer, and The Bank of New York, as Trustee
(incorporated by reference to Exhibit 1.2 of Form 8-A of the
registrant dated October 15, 1996, File No. 33-49106).
4.3 Amendment No. 2 to Master Pooling and Servicing Agreement, dated as
of July 15, 1994, among American Express Receivables Financing
Corporation, as Transferor, American Express Travel Related Services
Company, Inc., as Servicer, and The Bank of New York, as Trustee
(incorporated by reference to Exhibit 2 of Form 8-K of the registrant
dated July 15, 1994, File No. 33-49106).
4.4 Amendment No. 3 to Master Pooling and Servicing Agreement, dated as
of September 12, 1994, among American Express Receivables Financing
Corporation, as Transferor, American Express Travel Related Services
Company, Inc., as Servicer, and The Bank of New York, as Trustee
(incorporated by reference to Exhibit 2 of Form 8-K of the registrant
dated September 12, 1994, File No. 33-49106).
4.5 Amendment No. 4 to Master Pooling and Servicing Agreement, dated as
of January 17, 1996, among American Express Receivables Financing
Corporation, as Transferor, American Express Travel Related Services
Company, Inc., as Servicer, and The Bank of New York, as Trustee
(incorporated by reference to Exhibit 2 of Form 8-K of the registrant
dated January 17, 1996, File No. 33-49106).
4.6 Amendment No. 5 to Master Pooling and Servicing Agreement, dated as
of March 27, 1997, among American Express Receivables Financing
Corporation, as Transferor, American Express Travel Related Services
Company, Inc., as Servicer, and The Bank of New York, as Trustee
(incorporated by reference to Exhibit 4.6 of Form 10-K of the
registrant dated March 26, 1998, File Nos. 33-47812, 33-49106,
33-67502 and 33-81634).
4.7 Amended and Restated Master Pooling and Servicing Agreement, dated as
of May 1, 1998, among American Express Receivables Financing
Corporation and American Express Centurion Bank, as Transferors,
American Express Travel Related Services Company, Inc., as Servicer,
and The Bank of New York, as Trustee (incorporated by reference
to Exhibit 4.1 of Form 8-K of the registrants dated May 27,
1998, File Nos. 33-47812, 33-49106, 33-67502, 33-81634, 333-51045,
000-21424 and 000-21424-01).
<PAGE>
4.8 Series 1992-2 Supplement, dated as of August 3, 1992, to Master
Pooling and Servicing Agreement (incorporated by reference to Exhibit
2 of Form 8-K of the registrant dated August 3, 1992, File No.
33-47812).
4.9 Series 1993-1 Supplement, dated as of September 1, 1993, to Master
Pooling and Servicing Agreement (incorporated by reference to Exhibit
2 of Form 8-K of the registrant dated September 22, 1993, File No.
33-47812).
4.10 Series 1994-2 Supplement, dated as of September 1, 1994, to Master
Pooling and Servicing Agreement (incorporated by reference to Exhibit
6 of Form 8-K of the registrant dated September 12, 1994, File No.
33-47812).
4.11 Series 1994-3 Supplement, dated as of September 1, 1994, to Master
Pooling and Servicing Agreement (incorporated by reference to Exhibit
7 of Form 8-K of the registrant dated September 12, 1994, File No.
33-47812).
4.12 Series 1996-1 Supplement, dated as of September 18, 1996, to Master
Pooling and Servicing Agreement (incorporated by reference to Exhibit
20.1 of Form 8-K of the registrant dated September 18, 1996, File No.
33-47812).
4.13 Series 1996-2 Supplement, dated as of September 18, 1996, to Master
Pooling and Servicing Agreement (incorporated by reference to Exhibit
20.2 of Form 8-K of the registrant dated September 18, 1996, File No.
33-47812).
4.14 Series 1998-1 Supplement, dated as of May 27, 1998, to the Amended
and Restated Master Pooling and Servicing Agreement, dated as of
May 1, 1998 (incorporated by reference to Exhibit 4.2 of Form 8-K
of the registrants dated May 27, 1998, File Nos. 33-47812,
33-49106, 33-67502, 33-81634, 333-51045, 000-21424 and 000-21424-01).
10.1 Receivable Purchase Agreement, dated as of June 30, 1992, between
American Express Receivables Financing Corporation, as purchaser, and
American Express Travel Related Services Company, Inc., as seller
(incorporated by reference to Exhibit 4(b) to the Registration
Statement filed on behalf of American Express Master Trust, Series
1992-1, File No. 33-47812).
<PAGE>
10.2 Amendment No. 1 to Receivable Purchase Agreement, dated as of
September 12, 1994, between American Express Receivables Financing
Corporation, as purchaser, and American Express Travel Related
Services Company, Inc., as seller (incorporated by reference to
Exhibit 4 of Form 8-K of the registrant dated September 12, 1994,
File No. 33-47812).
10.3 Amendment No. 2 to Receivable Purchase Agreement, dated as of August
7, 1997, between American Express Receivables Financing Corporation,
as purchaser, and American Express Travel Related Services Company,
Inc., as seller (incorporated by reference to Exhibit 20.3 of Form
8-K of the registrant dated August 14, 1997, File No. 33-47812).
24.1* Power of Attorney for RFC.
24.2* Power of Attorney for Centurion.
99.1* Annual Servicing Statement Delivered to the Trustee.
99.2* Annual Accountant's Report of Ernst & Young LLP.
99.3* Annual Report Containing Aggregated Information for the Fiscal Year.
99.4* Pages 22 through 23 of American Express Company's 1998 Annual Report to
Shareholders, discussing Year 2000.
<PAGE>
EXHIBIT 24.1
AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION
POWER OF ATTORNEY
American Express Receivables Financing Corporation, a Delaware
corporation (the "Company"), and each of the undersigned officers and directors
of the Company, hereby constitute and appoint Jay B. Stevelman, John D. Koslow,
Leslie R. Scharfstein and Stephen P. Norman, jointly and severally, with full
power of substitution and revocation, their true and lawful attorneys-in-fact
and agents, for them and on their behalf and in their respective names, places
and steads, in any and all capacities, to sign, execute and affix their
respective seals thereto and file any of the documents referred to below
relating to the American Express Master Trust; all filings and reports required
under the Securities Exchange Act of 1934, including Current Reports on Form 8-K
and Annual Reports on Form 10-K, including any amendments thereto, on behalf of
the Company, with all exhibits and any and all documents required to be filed
with respect thereto with any regulatory authority, granting unto said
attorneys, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the premises
in order to effectuate the same as fully to all intents and purposes as they
might or could do if personally present, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or any of them, may lawfully do or cause
to be done by virtue hereof.
This Power of Attorney may be executed in counterparts.
IN WITNESS WHEREOF, American Express Receivables Financing Corporation
has caused this Power of Attorney to be executed in its name by its President
and attested by its Secretary, and the undersigned officers and directors have
hereunto set their hand as of the 23rd day of March 1999.
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION
By: /s/ Leslie R. Scharfstein
-------------------------
Leslie R. Scharfstein
President
ATTEST:
/s/ Michael Kuchs
- ------------------------
Michael Kuchs
Secretary
<PAGE>
/s/ Richard K. Goeltz
- ----------------------------
Richard K. Goeltz
Director
/s/ Vincent P. Lisanke
- ----------------------------
Vincent P. Lisanke
Director
/s/ Jay B. Stevelman
- ----------------------------
Jay B. Stevelman
Director
/s/ Leslie R. Scharfstein
- -----------------------------
Leslie R. Scharfstein
President
(Principal Executive Officer)
/s/ John D. Koslow
- ----------------------------
John D. Koslow
Vice President and Treasurer
(Principal Finance Officer and
Principal Accounting Officer)
<PAGE>
EXHIBIT 24.2
AMERICAN EXPRESS CENTURION BANK
POWER OF ATTORNEY
American Express Centurion Bank, a Utah corporation (the "Company"), and
each of the undersigned officers and directors of the Company, hereby constitute
and appoint Robert D. Kraus, Stephen P. Norman, Gilbert E. Ahye and Rhonda
Halpern, jointly and severally, with full power of substitution and revocation,
their true and lawful attorneys-in-fact and agents, for them and on their behalf
and in their respective names, places and steads, in any and all capacities, to
sign, execute and affix their respective seals thereto and file any of the
documents referred to below relating to the American Express Master Trust; all
filings and reports required under the Securities Exchange Act of 1934,
including Current Reports on Form 8-K and Annual Reports on Form 10-K, including
any amendments thereto, on behalf of the Company, with all exhibits and any and
all documents required to be filed with respect thereto with any regulatory
authority, granting unto said attorneys, and each of them, full power and
authority to do and perform each and every act and thing requisite and necessary
to be done in and about the premises in order to effectuate the same as fully to
all intents and purposes as they might or could do if personally present, hereby
ratifying and confirming all that said attorneys-in-fact and agents, or any of
them, may lawfully do or cause to be done by virtue hereof.
This Power of Attorney may be executed in counterparts.
IN WITNESS WHEREOF, American Express Centurion Bank has caused this
Power of Attorney to be executed in its name by its Chairman and attested by its
Assistant Secretary, and the undersigned officers and directors have
hereunto set their hand as of the 25th day of March 1999.
AMERICAN EXPRESS CENTURION BANK
By: /s/ Frank L. Skillern
---------------------
Frank L. Skillern
Chairman
ATTEST:
/s/ Robert D. Kraus
- ------------------------
Robert D. Kraus
Assistant Secretary
<PAGE>
/s/ Frank L. Skillern
- ----------------------------
Frank L. Skillern
Director and Chairman
/s/ David E. Poulsen
- ----------------------------
David E. Poulsen
Director, President and Chief Executive Officer
/s/ Gilbert E. Ahye
- ----------------------------
Gilbert E. Ahye
Director
/s/ Maria J. Garciaz
- ----------------------------
Maria J. Garciaz
Director
/s/ Ash Gupta
- ----------------------------
Ash Gupta
Director
/s/ Peter A. Lefferts
- ----------------------------
Peter A. Lefferts
Director
/s/ Raymond F. Pettit
- ----------------------------
Raymond F. Pettit
Director
/s/ Rosalyn M. Watson
- ----------------------------
Rosalyn M. Watson
Director
/s/ James F. Welch
- ----------------------------
James F. Welch
Director
<PAGE>
EXHIBIT 99.1
ANNUAL SERVICER'S CERTIFICATE
AMERICAN EXPRESS TRAVEL
RELATED SERVICES COMPANY, INC.
---------------------------------------------------------------
AMERICAN EXPRESS MASTER TRUST
---------------------------------------------------------------
The undersigned, a duly authorized representative of American Express
Travel Related Services Company, Inc., as Servicer ("TRS"), pursuant to the
Amended and Restated Master Pooling and Servicing Agreement dated as of May 1,
1998 (as amended and supplemented, the "Agreement"), by and among TRS, as
Servicer, American Express Centurion Bank, a Utah banking institution, and
American Express Receivables Financing Corporation, each as Transferor, and The
Bank of New York, as trustee (the "Trustee"), does hereby certify to the best of
his knowledge after reasonable investigation that:
1. TRS is as of the date hereof the Servicer under the Agreement.
Capitalized terms used in this Certificate have their respective meanings set
forth in the Agreement.
2. The undersigned is duly authorized pursuant to the Agreement to
execute and deliver this Certificate to the Trustee.
3. This Certificate is delivered pursuant to Section 3.05 of the Agree-
ment.
4. A review of the activities of the Servicer during the calendar year
ended December 31, 1998 and of its performance under the Agreement was conducted
under my supervision.
5. Based on such review, to the best of my knowledge, the Servicer has
fully performed all its obligations under the Agreement throughout such calendar
year and no event which, with the giving of notice or passage of time or both,
would constitute a Servicer Default has occurred and is continuing except as set
forth in paragraph 6 below.
6. The following is a description of each Servicer Default in the
performance of the Servicer's obligations or Early Amortization Event under the
provisions of the Agreement known to me to have been made during the calendar
year ended December 31, 1998, which sets forth in detail (i) the nature of each
such Servicer Default or Early Amortization Event, (ii) the action taken by the
Servicer, if any, to remedy each such Servicer Default or Early Amortization
Event, and (iii) the current status of each such default: NONE.
IN WITNESS WHEREOF, the undersigned, a duly authorized officer of the
Servicer, has duly executed this Certificate this 19th day of March, 1999.
AMERICAN EXPRESS TRAVEL RELATED
SERVICES COMPANY, INC., as Servicer
By: /s/ Lawrence Fazzari
---------------------------------
Name Lawrence Fazzari
Title: Vice President - Business Results
<PAGE>
EXHIBIT 99.2
REPORT OF INDEPENDENT ACCOUNTANTS
American Express Travel Related Services Company, Inc.
3 World Financial Center
200 Vesey Street
New York, New York 10285
American Express Centurion Bank
6985 Union Park Center, Suite 235
Midvale, UT 84047
American Express Receivables Financing Corporation
3 World Financial Center
200 Vesey Street
New York, New York 10285
and
The Bank of New York
101 Barclay Street, Floor 12E
New York, New York 10286
We have audited in accordance with generally accepted auditing standards the
consolidated balance sheet of American Express Travel Related Services Company,
Inc. (the "Company") as of December 31, 1998, and the related consolidated
statements of income, shareholder's equity, and cash flows for the year then
ended, and have issued our report thereon dated February 4, 1999.
In connection with our audit, nothing came to our attention that caused us to
believe that the Company failed to comply with the terms, covenants, provisions,
or conditions of Articles III and IV and Section 8.08 of the Amended and
Restated Master Pooling and Servicing Agreement, dated as of May 1, 1998, as
supplemented by the Series' 1992-2, 1993-1, 1994-1, 1994-2, 1994-3, 1996-1,
1996-2, and 1998-1 Supplements (together the "Agreement"), among the Company,
as Servicer, American Express Receivables Financing Corporation ("RFC") and
American Express Centurion Bank ("Centurion"), as transferors, and The Bank of
New York ("BONY"), as Trustee on behalf of the Certificateholders of the Trust,
insofar as they relate to accounting matters. However, our audit is not directed
primarily toward obtaining knowledge of such noncompliance.
<PAGE>
Also, it should be understood that we make no representations as to
questions of legal interpretation. This report is intended solely for the
information and use of the Company, RFC, Centurion, BONY, Moody's Investors
Services and Standard & Poor's Corporation and is not intended to be and should
not be used by anyone other than these specified parties. However, this report
is a matter of public record, as a result of inclusion as an exhibit to the
Annual Report to Shareholders on Form 10-K filed by RFC on behalf of the Trust,
and its distribution is not limited.
March 15, 1999 /s/ Ernst & Young LLP
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
American Express Travel Related Services Company, Inc.
3 World Financial Center
200 Vesey Street
New York, New York 10285
American Express Centurion Bank
6985 Union Park Center, Suite 235
Midvale, UT 84047
American Express Receivables Financing Corporation
3 World Financial Center
200 Vesey Street
New York, New York 10285
and
The Bank of New York
101 Barclay Street, Floor 12E
New York, New York 10286
We have examined management's assertion that American Express Travel Related
Services Company, Inc. ("TRS"), a wholly owned subsidiary of American Express
Company ("American Express"), maintained internal control policies and
procedures over the functions performed as Servicer of the American Express
Master Trust (the "Trust") that are effective, as of December 31, 1998, in
providing reasonable assurance that Trust assets are safeguarded against loss
from unauthorized use or disposition and that transactions are executed in
accordance with management's authorization in conformity with the Amended and
Restated Master Pooling and Servicing Agreement, dated as of May 1, 1998, as
supplemented by the Series' 1992-2, 1993-1, 1994-1, 1994-2, 1994-3, 1996-1,
1996-2, and 1998-1 Supplements (together the "Agreement"), among TRS as
Servicer, American Express Receivables Financing Corporation ("RFC") and
American Express Centurion Bank ("Centurion"), as Transferors, and The Bank of
New York, as Trustee on behalf of the Certificateholders of the Trust, and are
recorded properly to permit the preparation of the required financial reports.
This assertion is included in the accompanying report of management titled,
"Report of Management on Master Trust Internal Control Policies and Procedures
and Pooling and Servicing Agreement Compliance" (the "Report").
<PAGE>
Our examination was made in accordance with standards established by the
American Institute of Certified Public Accountants, and accordingly, included
obtaining an understanding of the internal control policies and procedures over
the functions performed by TRS as Servicer of the Trust, testing and evaluating
the design and operating effectiveness of the policies and procedures, and such
other procedures as we considered necessary in the circumstances. We believe
that our examination provides a reasonable basis for our opinion.
Because of inherent limitations in any internal control policy and procedure,
errors or irregularities may occur and not be detected. Also, projections of any
evaluation of the control structure policies and procedures over the functions
performed by TRS as Servicer of the Trust to future periods are subject to the
risk that the policies and procedures may become inadequate because of changes
in conditions or that the degree of compliance with the policies or procedures
may deteriorate.
In our opinion, management's assertion that TRS maintained internal control
policies and procedures over the functions performed as Servicer of the Trust
that are effective, as of December 31, 1998, in providing reasonable assurance
that Trust assets are safeguarded against loss from unauthorized use or
disposition and that transactions are executed in accordance with management's
authorization in conformity with the Agreements between TRS as Servicer, RFC and
Centurion as Transferors, and The Bank of New York, as Trustee on behalf of the
Certificateholders of the Trust, and are recorded properly to permit the
preparation of the required financial reports, is fairly stated, in all material
respects, based upon the criteria specified in the Report.
This report is intended solely for the information and use of the Board of
Directors and management of TRS as Servicer, RFC and Centurion as Transferors,
and The Bank of New York as Trustee on behalf of the Certificateholders of the
Trust, and is not intended to be and should not be used by anyone other than
these specified parties. However, this report is a matter of public record, as a
result of inclusion as an exhibit to the Annual Report to Shareholders on Form
10-K filed by RFC on behalf of the Trust, and its distribution is not limited.
March 15, 1999 /s/ Ernst & Young LLP
<PAGE>
REPORT OF MANAGEMENT ON MASTER TRUST INTERNAL CONTROL
POLICIES AND PROCEDURES AND POOLING AND SERVICING
AGREEMENT COMPLIANCE
Internal Control Policies and Procedures
- ----------------------------------------
American Express Travel Related Services Company, Inc. ("TRS"), which is a
wholly owned subsidiary of American Express Company, is responsible for
establishing and maintaining effective control structure policies and procedures
over the functions performed as Servicer of the American Express Master Trust
(the "Trust"). These policies and procedures are designed to provide reasonable
assurance to TRS's management and board of directors that Trust assets are
safeguarded against loss from unauthorized use or disposition and that
transactions are executed in conformity with the Amended and Restated Master
Pooling and Servicing Agreement, dated as of May 1, 1998 as supplemented by the
Series' 1992-2, 1993-1, 1994-1, 1994-2, 1994-3, 1996-1, 1996-2, and 1998-1
Supplements (together the "Agreement"), among TRS as Servicer, American Express
Receivables Financing Corporation ("RFC") and American Express Centurion Bank
("Centurion") as Transferors, and The Bank of New York as Trustee on behalf of
the Certificateholders of the Trust, and are recorded properly to permit the
preparation of the required financial reports.
There are inherent limitations in any internal control policy and procedure,
including the possibility of human error and the circumvention or overriding of
controls. Accordingly, even effective internal control policies and procedures
can provide only reasonable assurance with respect to the achievement of any
objectives of internal control. Further, because of changes in conditions, the
effectiveness of the internal control policies and procedures may vary over
time.
TRS has determined that the objectives of its control structure policies and
procedures, with respect to servicing and reporting of transferred receivables,
are to provide reasonable, but not absolute assurance that:
o Funds collected are appropriately allocated to the Trust in accordance with
the Agreement.
o The addition of Accounts to the Trust are authorized in accordance with the
Agreement.
<PAGE>
o The removal of Accounts from the Trust are authorized in accordance with
the Agreement.
o Trust assets amortizing out of the Trust are calculated in accordance with
the Agreement.
o Daily records as specified in the Agreement are maintained and are
available for inspection by the Trustee upon request.
o Monthly Servicer's Certificates are prepared and contain the required
information in accordance with the Agreement.
o Monthly Servicer's Certificates generated pursuant to the Agreement are
materially correct and are derived from and reconcile to the computer
reports which are the source of such amounts contained in the reports.
o On an annual basis, the Servicer will deliver to the Trustee an
Annual Servicer's Certificate.
o The payments to the Trustee are made by the Servicer in accordance with the
Agreement.
TRS has assessed its internal control policies and procedures over the functions
performed as Servicer of the Trust in relation to these criteria. Based upon
this assessment, TRS maintained that, as of December 31, 1998, its internal
control policies and procedures over the functions performed as Servicer of the
Trust are effective in providing reasonable assurance that Trust assets are
safeguarded against loss from unauthorized use or disposition and the
transactions are executed in accordance with management's authorization in
conformity with the Agreement among TRS as Servicer, RFC and Centurion as
Transferors, and The Bank of New York as Trustee on behalf of the
Certificateholders of the Trust, and are recorded properly to permit the
preparation of the required financial reports.
Pooling and Servicing Agreement Compliance
- ------------------------------------------
TRS is responsible for complying with the Agreement. TRS assessed its
compliance, as of December 31, 1998 and for the annual compliance period then
ended, with the relevant covenants and conditions identified in the Agreement.
Based upon this assessment and the delivery of the independent accountant's
letters pursuant to Section 3.06 (a) and (b) of the Agreement, TRS was in
compliance, as of December 31, 1998 and for the annual compliance period then
ended, with the relevant covenants and conditions identified in the Agreement.
In addition, TRS did not identify any instances of noncompliance in performing
the assessment.
March 15, 1999
<PAGE>
American Express Travel Related Services Company, Inc. by:
/s/ Kevin Mahoney
---------------------------
Kevin Mahoney
Senior Vice President
Global Business Management and Analysis
/s/ Gil Ahye
---------------------------
Gil Ahye
Senior Vice President & CFO,
CCSG Finance
/s/ Lawrence Fazzari
---------------------------
Lawrence Fazzari
Vice President, Business Results
/s/ Michael Del Priore
---------------------------
Michael Del Priore
Director, Business Results
<PAGE>
EXHIBIT 99.3
Servicer's Certificate
American Express Travel Related Services Company, Inc.
Annual Statement
Relating to the Period January 1, 1998 through December 28, 1998
----------------------------------------------
American Express Master Trust
----------------------------------------------
The undersigned, a duly authorized representative of American Express
Travel Related Services Company, Inc. ("TRS"), as Servicer pursuant to the
Amended and Restated Master Pooling and Servicing Agreement dated as of May 1,
1998 (as amended, the "Agreement"), as supplemented by the Series Supplements,
amongst TRS, American Express Receivables Financing Corporation ("RFC"), and
American Express Centurion Bank (AECB) as Transferors, and The Bank of New York,
as Trustee, does hereby certify the information set forth below.
1. Capitalized terms used in this Certificate have their respective
meanings as set forth in the Agreement or Series Supplement as applicable.
References herein to certain sections and subsections are references to the
respective sections and subsections in the Agreement.
2. TRS is Servicer under the Agreement.
3. The undersigned is a Servicing Officer.
4. This Certificate relates to the period from January 1 through
December 28, 1998.
A. Information Regarding the American Express Master Trust
1. Trust Principal Component at
January 1, 1998..... $6,877,683,509.84
2. Aggregate Invested Amounts at
January 1, 1998..... $3,467,753,466.00
3. Transferor Amount at
January 1, 1998..... $3,409,930,043.84
4. Trust Principal Component at
December 28, 1998..... $6,618,962,209.69
5. Aggregate Invested Amounts at
December 28, 1998..... $4,208,494,207.00
6. Transferor Amount at
December 28, 1998..... $2,410,468,002.69
B. Information Regarding Performance of the American Express Master Trust
Receivable Pool
1. The aggregate Receivable balance as of
(a) January 1, 1998 was equal to..... $7,090,395,370.96
(b) December 28, 1998 was equal to..... $6,823,672,381.13
<PAGE>
Servicer's Certificate
American Express Travel Related Services Company, Inc.
Relating to the Period January 1, 1998 through December 28, 1998
2. The Yield Factor in effect from January 1 through
December 28, 1998 was equal to..... 3.0000%
3. (a)The aggregate amount of Collections on Receivables,
exclusive of recoveries for the period January 1
through December 28, 1998 was equal to..... $53,874,581,902.59
3. (b)The aggregate balance of Receivables
deposited to the Collection Account
pursuant to Sections 2.04(d) and 3.03
of the Agreement for the period January 1
through December 28, 1998 was equal to..... $ 0.00
4. The aggregate amount of Principal Collections
for the period January 1 through December 28, 1998
was equal to..... $52,258,344,445.51
5. The aggregate amount of Yield Collections
for the period January 1 through December 28, 1998
was equal to..... $ 1,616,237,457.08
6. Gross Losses
[The aggregate amount of Receivables for all Accounts
which became Defaulted Accounts during the period
January 1 through December 28, 1998
was equal to]... $ 282,235,091.05
7. The aggregate amount of Recoveries
for the period January 1 through December 28, 1998
was equal to..... $ 64,970,764.66
8. (a)Net Losses [Gross Losses, less Recoveries]
for the period January 1 through December 28, 1998
was equal to..... $ 217,264,326.39
8. (b)The Default Amount [Net Losses, times
(1 minus the Yield Factor)]
for the period January 1 through December 28, 1998
was equal to..... $ 210,746,396.60
C. Information Regarding Performance of the American Express Master Trust
Receivable Pool (Percentage Basis)
1. The aggregate amount of Charge Volume and Fees
for the period January 1 through
December 28, 1998..... $53,890,093,748.15
2. Computed yield as a percentage of Charge Volume
and Fees [Yield Collections for the period
January 1 through December 28, 1998 divided by the
aggregate amount of Charge Volume and Fees for the
period January 1 through December 28, 1998..... 2.9991%
- 2 -
<PAGE>
Servicer's Certificate
American Express Travel Related Services Company, Inc.
Relating to the Period January 1, 1998 through December 28, 1998
3. Gross Losses as a percentage of Charge Volume
and Fees [Gross Losses, divided by the
aggregate amount of Charge Volume and Fees for the
period January 1 through December 28, 1998..... 0.5237%
4. Recovery rate [Recoveries, divided by the
aggregate amount of Charge Volume and Fees for the
period January 1 through December 28, 1998..... 0.1206%
5. Net Losses as a percentage of Charge Volume
and Fees [Net Losses, divided by the
aggregate amount of Charge Volume and Fees for the
period January 1 through December 28, 1998..... 0.4032%
6. Computed Net Yield as a percentage of Charge Volume
and Fees [Yield Collections less net Net Losses,
divided by the aggregate amount of Charge Volume and
Fees for the period January 1 through
December 28, 1998..... 2.5960%
7. Mean monthly Payment rate
[Average of the Average Monthly Payment Rates
reported for the Due Periods in 1998]..... 79.4060%
8. Mean Receivable turnover rate [Average of
the Receivable Turnover Rates reported for the Due
Periods in 1998]..... 9.0825
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this 11th day of March, 1999.
American Express
Travel Related Services
Company, Inc.
Servicer,
By: /s/ Lawrence Fazzari
------------------------------
Name: Lawrence Fazzari
Title: Vice President
Business Results
- 3 -
<PAGE>
-----------------------------------------------------
American Express Travel Related Services Company, Inc.
American Express Master Trust, Series 1992-2
-----------------------------------------------------
Schedule - to Year End Servicer's Certificate with respect
to the Series 1992-2 Certificates
A. Information Regarding American Express Master Trust aggregated for the
period January 1 through December 28, 1998 allocated to Series
1992-2.
1. Yield Collections allocated to Series 1992-2..... $ 150,262,845.18
2. Principal Collections allocated to
Series 1992-2 during the Revolving Period,
treated as Excess principal Collections..... $4,858,498,660.71
3. The Investor Default Amount allocated to
Series 1992-2..... $ 19,595,790.83
4. Total amount of Interest distributed to holders
of Series 1992-2 $ 33,000,000.00
5. Total amount of Principal distributed to
holders of Series 1992-2 $ 0.00
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this 11th day of March, 1999.
American Express
Travel Related Services Company, Inc.
Servicer,
by: /s/ Lawrence Fazzari
-----------------------------------
Name: Lawrence Fazzari
Title: Vice President
Business Results
<PAGE>
-----------------------------------------------------
American Express Travel Related Services Company, Inc.
American Express Master Trust, Series 1993-1
-----------------------------------------------------
Schedule - to Year End Servicer's Certificate with respect
to the Series 1993-1 Certificates
A. Information Regarding American Express Master Trust aggregated for the
period January 1 through December 28, 1998 allocated to Series
1993-1.
1. Yield Collections allocated to Series 1993-1..... $ 180,315,414.27
2. Principal Collections allocated to
Series 1993-1 during the Revolving Period,
treated as Excess principal Collections..... $5,830,198,394.69
3. The Investor Default Amount allocated to
Series 1993-1..... $ 23,514,949.00
4. Total amount of Interest distributed to holders
of Series 1993-1 $ 32,250,000.00
5. Total amount of Principal distributed to
holders of Series 1993-1 $ 0.00
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this 11th day of March, 1999.
American Express
Travel Related Services Company, Inc.
Servicer,
by: /s/ Lawrence Fazzari
-----------------------------------
Name: Lawrence Fazzari
Title: Vice President
Business Results
<PAGE>
-----------------------------------------------------
American Express Travel Related Services Company, Inc.
American Express Master Trust, Series 1994-1
-----------------------------------------------------
Schedule - to Year End Servicer's Certificate with respect
to the Series 1994-1 Certificates
A. Information Regarding American Express Master Trust aggregated for the
period January 1 through December 28, 1998 allocated to Series
1994-1.
1. Yield Collections allocated to Series 1994-1..... $ 59,567,646.54
2. Principal Collections allocated to
Series 1994-1 during the Revolving Period,
treated as Excess principal Collections..... $1,926,020,571.43
3. The Investor Default Amount allocated to
Series 1994-1..... $ 8,064,296.77
4. Total amount of Interest distributed to holders
of Series 1994-1 $ 21,450,000.00
5. Total amount of Principal distributed to
holders of Series 1994-1 $ 317,460,317.00
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this 11th day of March, 1999.
American Express
Travel Related Services Company, Inc.
Servicer,
by: /s/ Lawrence Fazzari
-----------------------------------
Name: Lawrence Fazzari
Title: Vice President
Business Results
<PAGE>
-----------------------------------------------------
American Express Travel Related Services Company, Inc.
American Express Master Trust, Series 1994-2
-----------------------------------------------------
Schedule - to Year End Servicer's Certificate with respect
to the Series 1994-2 Certificates
A. Information Regarding American Express Master Trust aggregated for the
period January 1 through December 28, 1998 allocated to Series
1994-2.
1. Yield Collections allocated to Series 1994-2..... $ 90,157,706.99
2. Principal Collections allocated to
Series 1994-2 during the Revolving Period,
treated as Excess principal Collections..... $2,915,099,192.75
3. The Investor Default Amount allocated to
Series 1994-2..... $ 11,757,474.48
4. Total amount of Interest distributed to holders
of Series 1994-2 $ 22,800,000.00
5. Total amount of Principal distributed to
holders of Series 1994-2 $ 0.00
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this 11th day of March, 1999.
American Express
Travel Related Services Company, Inc.
Servicer,
by: /s/ Lawrence Fazzari
-----------------------------------
Name: Lawrence Fazzari
Title: Vice President
Business Results
<PAGE>
-----------------------------------------------------
American Express Travel Related Services Company, Inc.
American Express Master Trust, Series 1994-3
-----------------------------------------------------
Schedule - to Year End Servicer's Certificate with respect
to the Series 1994-3 Certificates
A. Information Regarding American Express Master Trust aggregated for the
period January 1 through December 28, 1998 allocated to Series
1994-3.
1. Yield Collections allocated to Series 1994-3..... $ 90,157,706.99
2. Principal Collections allocated to
Series 1994-3 during the Revolving Period,
treated as Excess principal Collections..... $2,915,099,192.75
3. The Investor Default Amount allocated to
Series 1994-3..... $ 11,757,474.48
4. Total amount of Interest distributed to holders
of Series 1994-3 $ 23,550,000.00
5. Total amount of Principal distributed to
holders of Series 1994-3 $ 0.00
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this 11th day of March, 1999.
American Express
Travel Related Services Company, Inc.
Servicer,
by: /s/ Lawrence Fazzari
-----------------------------------
Name: Lawrence Fazzari
Title: Vice President
Business Results
<PAGE>
-----------------------------------------------------
American Express Travel Related Services Company, Inc.
American Express Master Trust, Series 1996-1
-----------------------------------------------------
Schedule - to Year End Servicer's Certificate with respect
to the Series 1996-1 Certificates
A. Information Regarding American Express Master Trust aggregated for the
period January 1 through December 28, 1998 allocated to Series
1996-1.
1. Yield Collections allocated to Series 1996-1..... $ 291,672,366.01
2. Principal Collections allocated to
Series 1996-1 during the Revolving Period,
treated as Excess principal Collections..... $9,430,739,834.31
3. The Investor Default Amount allocated to
Series 1996-1..... $ 38,037,018.85
4. Total amount of Interest distributed to holders
of Series 1996-1 $ 55,211,444.50
5. Total amount of Principal distributed to
holders of Series 1996-1 $ 0.00
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this 11th day of Mqrch, 1999.
American Express
Travel Related Services Company, Inc.
Servicer,
by: /s/ Lawrence Fazzari
-----------------------------------
Name: Lawrence Fazzari
Title: Vice President
Business Results
<PAGE>
-----------------------------------------------------
American Express Travel Related Services Company, Inc.
American Express Master Trust, Series 1996-2
-----------------------------------------------------
Schedule - to Year End Servicer's Certificate with respect
to the Series 1996-2 Certificates
A. Information Regarding American Express Master Trust aggregated for the
period January 1 through December 28, 1998 allocated to Series
1996-2.
1. Yield Collections allocated to Series 1996-2..... $ 92,107,062.86
2. Principal Collections allocated to
Series 1996-2 during the Revolving Period,
treated as Excess principal Collections..... $2,978,128,365.83
3. The Investor Default Amount allocated to
Series 1996-2..... $ 12,011,690.15
4. Total amount of Interest distributed to holders
of Series 1996-2 $ 17,343,943.01
5. Total amount of Principal distributed to
holders of Series 1996-2 $ 0.00
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this 11th day of March, 1999.
American Express
Travel Related Services Company, Inc.
Servicer,
by: /s/ Lawrence Fazzari
-----------------------------------
Name: Lawrence Fazzari
Title: Vice President
Business Results
<PAGE>
-----------------------------------------------------
American Express Travel Related Services Company, Inc.
American Express Master Trust, Series 1998-1
-----------------------------------------------------
Schedule - to Year End Servicer's Certificate with respect
to the Series 1998-1 Certificates
A. Information Regarding American Express Master Trust aggregated for the
period January 1 through December 28, 1998 allocated to Series
1996-2.
1. Yield Collections allocated to Series 1998-1..... $ 300,525,690.64
2. Principal Collections allocated to
Series 1998-1 during the Revolving Period,
treated as Excess principal Collections..... $9,716,997,330.60
3. The Investor Default Amount allocated to
Series 1998-1..... $ 39,191,581.69
4. Total amount of Interest distributed to holders
of Series 1998-1 $ 34,416,666.62
5. Total amount of Principal distributed to
holders of Series 1998-1 $ 0.00
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this 11th day of March, 1999.
American Express
Travel Related Services Company, Inc.
Servicer,
by: /s/ Lawrence Fazzari
-----------------------------------
Name: Lawrence Fazzari
Title: Vice President
Business Results
<PAGE>
Exhibit 99.4
PAGES 22 THROUGH 23 OF
AMERICAN EXPRESS COMPANY'S
1998 ANNUAL REPORT TO
SHAREHOLDERS, DISCUSSING
YEAR 2000
YEAR 2000
The Year 2000 (Y2K) issue is the result of computer programs having been written
using two digits rather than four to define a year. Some programs may recognize
a date using "00" as the year 1900 rather than 2000. This misinterpretation
could result in the failure of major systems or miscalculations, which could
have a material impact on the Company and its businesses or subsidiaries through
business interruption or shutdown, financial loss, reputational damage and legal
liability to third parties. The Company began addressing the Y2K issue in 1995
and has established a plan for resolution, which involves the remediation,
decommissioning and replacement of relevant systems, including mainframe,
mid-range and desktop computers, application software, operating systems,
systems software, date back-up archival and retrieval services, telephone and
other communications systems, and hardware peripherals and facilities dependent
on embedded technology. As a part of our plan, we have generally followed and
utilized the specific policies and guidelines established by the Federal
Financial Institutions Examination Council, as well as other U.S. and
international regulatory agencies. Additionally, we continue to participate in
Y2K related industry consortia sponsored by various partners and suppliers.
Progress is reviewed regularly with the Company's senior management and Board of
Directors.
Our Y2K compliance effort related to information technology (IT) systems is
divided into two initiatives. The first, which is the much larger initiative, is
known internally as "Millenniax," and relates to mainframe and other
technological systems maintained by the American Express Technologies
organization (AET). The second, known as "Business T," relates to the
technological assets that are owned, managed or maintained by the Company's
individual business units. Business T also encompasses the remediation of non-IT
systems. These initiatives involve a substantial number of employees and
external consultants. This multiple sourcing approach is intended to mitigate
the risk of becoming dependent on any one vendor or resource. While the vast
majority of our systems that require modification are being remediated, in some
cases we have chosen to migrate to new applications that are already Y2K
compliant.
The Company's plans for remediation with respect to Millenniax and Business T
include the following program phases: (i) employee awareness and mobilization,
(ii) inventory collection and assessment, (iii) impact analysis, (iv)
remediation/decommission, (v) testing and (vi) implementation. As part of the
first three phases, we have identified the Company's mission-critical systems
for purposes of prioritization. The Company's goals are to complete testing of
critical systems by early 1999, and to continue compliance efforts, including
but not limited to, the testing of systems on an integrated basis and
independent validation of such testing,
22
<PAGE>
through 1999.* We are currently on schedule to meet these goals. With respect to
systems maintained by the Company, the first three phases referred to above have
been substantially completed for both Millenniax and Business T. In addition,
remediation of critical systems is substantially complete. As of December 31,
1998, for Millenniax, the remediation/decommission, testing and implementation
phases for critical and non-critical systems in total are 82%, 75% and 60%
complete, respectively. For Business T, such phases are 85%, 70% and 69%
complete, respectively. Certain critical systems have already been made Y2K
compliant, such as the Worldwide Credit Authorization System, and we have
completed testing of the global point of sale infrastructure. As a result, we
have begun issuing Year 2000 dated charge and credit cards.
Our most commonly used methodology for remediation is the sliding window. Once
an application/system has been remediated, we apply specific types of tests,
such as stress, regression, unit, future date and baseline to ensure that the
remediation process has achieved Y2K compliance while maintaining the
fundamental data processing integrity of the particular system. To assist with
remediation and testing, we are using various standardized tools obtained from a
variety of vendors.
The Company's cumulative costs since inception of the Y2K initiatives were $383
million through December 31, 1998 and are estimated to be in the range of
$135-$160 million for the remainder through 2000.* These include both
remediation costs and costs related to replacements that were or will be
required as a result of Y2K. These costs, which are expensed as incurred, relate
to both Millenniax and Business T, and have not had, nor are they expected to
have, a material adverse impact on the Company's results of operations or
financial condition.* Costs related to Millenniax, which represent most of the
total Y2K costs of the Company, are managed by and included in the Corporate and
Other segment; costs related to Business T are included in the business
segments. Y2K costs related to Millenniax represent 14%, 6% and 1% of the AET
budget for the years 1998, 1999 and 2000, respectively. The Company has not
deferred other critical technology projects or investment spending as a result
of Y2K. However, because the Company must continually prioritize the allocation
of finite financial and human resources, certain non-critical spending
initiatives have been deferred.
The Company's major businesses are heavily dependent upon internal computer
systems, and all have significant interaction with systems of third parties,
both domestically and internationally. The Company is working with key external
parties, including merchants, clients, counterparties, vendors, exchanges,
utilities, suppliers, agents and regulatory agencies to mitigate the potential
risks to us of Y2K. The failure of external parties to resolve their own Y2K
issues in a timely manner could result in a material financial risk to the
Company. As part of our overall compliance program, the Company is actively
communicating with third parties through face-to-face meetings and
correspondence, on an ongoing basis, to ascertain their state of readiness.
Although numerous third parties have indicated to us in writing that they are
addressing their Y2K issues on a timely basis, the readiness of third parties
overall varies across the spectrum. Because the Company's Y2K compliance is
dependent on key third parties being compliant on a timely basis, there can be
no assurances that the Company's efforts alone will resolve all Y2K issues.
At this point, the Company is in the process of performing an assessment of
reasonably likely Y2K systems failures and related consequences. The Company is
also preparing specific Y2K contingency plans for all key American Express
business units to mitigate the potential impact of such failures. This effort is
a full-scale initiative that includes both internal and external experts under
the guidance of a Company-wide steering committee. Our contingency plans, which
will be based in part on an assessment of the magnitude and probability of
potential risks, will primarily focus on proactive steps to prevent Y2K failures
from occurring, or if they should occur, to detect them quickly, minimize their
impact and expedite their repair. The Y2K contingency plans will supplement
disaster recovery and business continuity plans already in place, and are
expected to include measures such as selecting alternative suppliers and
channels of distribution, and developing our own technology infrastructure in
lieu of those provided by third parties. Development of the Y2K contingency
plans is expected to be substantially complete by the end of the first quarter
of 1999, and will continue to be refined throughout 1999 as additional
information related to our exposures is gathered.*
*Statements in this Y2K discussion marked with an asterisk are forward-looking
statements which are subject to risks and uncertainties. Important factors that
could cause results to differ materially from these forward-looking statements
include, among other things, the ability of the Company to successfully identify
systems containing two-digit codes, the nature and amount of programming
required to fix the affected systems, the costs of labor and consultants related
to such efforts, the continued availability of such resources, and the ability
of third parties that interface with the Company to successfully address their
Y2K issues.
23
