<PAGE> 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OF THE
SECURITIES EXCHANGE ACT OF 1934
DATE OF REPORT (DATE OF EARLIEST EVENT REPORTED): JULY 22, 1998
DISCOVER CARD MASTER TRUST I
-------------------------------------------------
(EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)
DELAWARE 0-23108 51-0020270
------------- ------------ -------------------
(STATE OF (COMMISSION (IRS EMPLOYER
ORGANIZATION) FILE NUMBER) IDENTIFICATION NO.)
C/O GREENWOOD TRUST COMPANY
12 READ'S WAY
NEW CASTLE, DELAWARE 19720
- --------------------------- -----
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
REGISTRANT'S TELEPHONE NUMBER, INCLUDING AREA CODE: (302) 323-7184
--------------
FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT: NOT APPLICABLE
PAGE 1
<PAGE> 2
ITEM 5. OTHER EVENTS
------------
SERIES 1998-6. ON JULY 22, 1998, THE REGISTRANT MADE AVAILABLE TO
PROSPECTIVE INVESTORS A SERIES TERM SHEET SETTING FORTH A DESCRIPTION OF THE
COLLATERAL POOL AND THE PROPOSED STRUCTURE OF $500,000,000 AGGREGATE PRINCIPAL
AMOUNT OF SERIES 1998-6 ___% CLASS A CREDIT CARD PASS-THROUGH CERTIFICATES AND
$26,316,000 AGGREGATE PRINCIPAL AMOUNT OF SERIES 1998-6 ___% CLASS B CREDIT
CARD PASS-THROUGH CERTIFICATES OF DISCOVER CARD MASTER TRUST I. THE SERIES
TERM SHEET IS ATTACHED HERETO AS EXHIBIT 99.
ITEM 7. EXHIBITS
--------
EXHIBIT NO. DESCRIPTION
- ----------- -----------
EXHIBIT 99 SERIES TERM SHEET DATED JULY 22, 1998, WITH RESPECT TO THE
PROPOSED ISSUANCE OF THE ___% CLASS A CREDIT CARD PASS-THROUGH
CERTIFICATES AND THE ___% CLASS B CREDIT CARD PASS-THROUGH
CERTIFICATES OF DISCOVER CARD MASTER TRUST I, SERIES 1998-6.
PAGE 2
<PAGE> 3
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.
DISCOVER CARD MASTER TRUST I
(REGISTRANT)
BY: GREENWOOD TRUST COMPANY
(ORIGINATOR OF THE TRUST)
DATE: JULY 22, 1998 BY: /s/ JOHN J. COANE
--------------------------------------
JOHN J. COANE
VICE PRESIDENT, DIRECTOR OF ACCOUNTING
AND TREASURER
<PAGE> 4
INDEX TO EXHIBITS
-----------------
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION PAGE
- ------- ----------- ----
<S> <C> <C>
EXHIBIT 99 SERIES TERM SHEET DATED JULY 22, 1998, WITH RESPECT 5
TO THE PROPOSED ISSUANCE OF THE ___% CLASS A CREDIT
CARD PASS-THROUGH CERTIFICATES AND THE ___% CLASS B
CREDIT CARD PASS-THROUGH CERTIFICATES OF DISCOVER
CARD MASTER TRUST I, SERIES 1998-6.
</TABLE>
PAGE 4
<PAGE> 1
EXHIBIT 99
SUBJECT TO REVISION
SERIES TERM SHEET DATED JULY 22, 1998
DISCOVER(R) CARD MASTER TRUST I, SERIES 1998-6
$500,000,000 ___% CLASS A CREDIT CARD PASS-THROUGH CERTIFICATES
$26,316,000 ___% CLASS B CREDIT CARD PASS-THROUGH CERTIFICATES
GREENWOOD TRUST COMPANY
MASTER SERVICER, SERVICER AND SELLER
THE INVESTOR CERTIFICATES REPRESENT FRACTIONAL UNDIVIDED INTERESTS IN THE
DISCOVER CARD MASTER TRUST I (THE "TRUST") AND DO NOT REPRESENT INTERESTS IN OR
OBLIGATIONS OF GREENWOOD TRUST COMPANY ("GREENWOOD"). NEITHER THE INVESTOR
CERTIFICATES NOR THE UNDERLYING ACCOUNTS OR RECEIVABLES ARE INSURED OR
GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY GOVERNMENT
AGENCY.
THIS SERIES TERM SHEET CONTAINS STRUCTURAL AND COLLATERAL INFORMATION WITH
RESPECT TO THE SERIES 1998-6 INVESTOR CERTIFICATES; HOWEVER, THIS SERIES TERM
SHEET DOES NOT CONTAIN COMPLETE INFORMATION WITH RESPECT TO THE OFFERING OF THE
SERIES 1998-6 INVESTOR CERTIFICATES. THE INFORMATION HEREIN IS PRELIMINARY AND
WILL BE SUPERSEDED BY THE INFORMATION CONTAINED IN THE PROSPECTUS SUPPLEMENT AND
THE PROSPECTUS. ADDITIONAL INFORMATION WILL BE CONTAINED IN THE PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS. PURCHASERS ARE URGED TO READ BOTH THE PROSPECTUS
SUPPLEMENT AND THE PROSPECTUS. INFORMATION REGARDING PAST PERFORMANCE
CONTAINED HEREIN IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. PRICE AND
AVAILABILITY OF THE SERIES 1998-6 INVESTOR CERTIFICATES ARE SUBJECT TO CHANGE
WITHOUT NOTICE.
THIS SERIES TERM SHEET HAS BEEN PREPARED SOLELY FOR INFORMATIONAL PURPOSES
AND IS NOT AN OFFER TO BUY OR SELL OR THE SOLICITATION OF AN OFFER TO BUY OR
SELL ANY SECURITY OR INSTRUMENT OR TO PARTICIPATE IN ANY PARTICULAR TRADING
STRATEGY. THERE SHALL BE NO OFFER, SOLICITATION OR SALE OF THESE SECURITIES IN
ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR TO
REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE. SALES
OF THE SERIES 1998-6 INVESTOR CERTIFICATES MAY NOT BE CONSUMMATED UNLESS THE
PURCHASER HAS RECEIVED BOTH THE PROSPECTUS SUPPLEMENT AND THE PROSPECTUS. THE
UNDERWRITERS AND OTHERS ASSOCIATED WITH THEM MAY HAVE POSITIONS IN, AND MAY
EFFECT TRANSACTIONS IN, SECURITIES AND INSTRUMENTS OF THE TRUST OR GREENWOOD AND
MAY ALSO PERFORM OR SEEK TO PERFORM INVESTMENT BANKING SERVICES FOR THE TRUST
AND GREENWOOD.
MORGAN STANLEY DEAN WITTER
ABN AMRO INCORPORATED
BANCAMERICA ROBERTSON STEPHENS
FIRST UNION CAPITAL MARKETS
NOT FOR DISTRIBUTION TO PRIVATE CUSTOMERS AS DEFINED BY THE U.K.
SECURITIES AND FUTURES AUTHORITY.
<PAGE> 2
This Series Term Sheet will be superseded in its entirety by the information
appearing in the Prospectus Supplement, the Prospectus and the Series 1998-6
Supplement to the Pooling and Servicing Agreement, dated as of October 1, 1993
as amended, between Greenwood and U.S. Bank National Association (formerly
First Bank National Association, successor trustee to Bank of America Illinois,
formerly Continental Bank, National Association), as Trustee (the "Series
Supplement").
<TABLE>
<S> <C>
TITLE OF SECURITIES .................... Discover Card Master Trust I, Series
1998-6 ____% Class A Credit Card
Pass-Through Certificates (the "Class
A Certificates") and Discover Card
Master Trust I, Series 1998-6 ____%
Class B Credit Card Pass-Through
Certificates (the "Class B
Certificates," and together with the
Class A Certificates, the "Investor
Certificates").
INTEREST ON INVESTOR CERTIFICATES ...... Class A Certificates: ____% per
annum.
Class B Certificates: ____% per
annum.
Interest on the Investor Certificates
will be calculated on the basis of a
360-day year of twelve 30 day months;
payable on the 15th day of each July
and January (or, if such day is not a
business day, the next succeeding
business day), commencing in January
1999 and on the Class B Expected
Final Payment Date (or monthly under
certain circumstances).
PRINCIPAL ON INVESTOR CERTIFICATES ..... The principal of the Class A
Certificates and the Class B
Certificates is scheduled to be
paid on the Class A Expected Final
Payment Date and the Class B Expected
Final Payment Date, respectively, but
may be paid earlier or later, or
monthly, under certain circumstances.
SERIES CUT-OFF DATE .................... July 1, 1998.
CLASS A EXPECTED FINAL PAYMENT DATE .... The Distribution Date in July 2003.
"Distribution Date" will mean the
15th calendar day of each month, or
if such day is not a business day,
the next succeeding business day,
commencing in August 1998.
CLASS B EXPECTED FINAL PAYMENT DATE .... The Distribution Date in August 2003.
SERIES TERMINATION DATE ................ The first business day following the
Distribution Date in January 2006.
SUBORDINATION OF CLASS B CERTIFICATES .. The Class B Certificates are
subordinated in right of payment to
the Class A Certificates, to the
extent of the Available Subordinated
Amount at the time any such
subordinated payment is made.
AVAILABLE SUBORDINATED AMOUNT .......... Initially $44,736,860, which may be
reduced, reinstated or increased from
time to time. The Available
Subordinated Amount will be increased
following an Effective Alternative
Credit Support Election (as defined
below) by $26,315,800.
"Effective Alternative Credit Support
Election" will mean an effective
election made by Greenwood under
the
</TABLE>
2
<PAGE> 3
<TABLE>
<CAPTION>
<S> <C>
terms of the Series Supplement to
increase the amount on deposit
in the Credit Enhancement Account (as
defined below in Credit Enhancement).
CREDIT ENHANCEMENT ................... Credit Enhancement initially will
consist solely of a cash collateral
account for the exclusive
direct benefit of the holders of the
Class B Certificates (the "Credit
Enhancement Account").
The initial amount of the Credit
Enhancement is $21,052,640. The
maximum amount of Credit Enhancement
as of any Distribution Date will be
the greater of (i) $5,263,160 and (ii)
(x) if a Supplemental Credit
Enhancement Event (as defined below)
has not occurred, an amount equal to
4.0% of the Series Investor Interest
(as defined below) as of the last day
of the related Due Period (as defined
below) or (y) if a Supplemental Credit
Enhancement Event has occurred, an
amount equal to 5.0% of the Series
Investor Interest as of the last day
of the related Due Period (or,
following an Effective Alternative
Credit Support Election, the greater
of $5,263,160 and an amount equal to
8.5% of the Series Investor Interest
as of the last day of the related Due
Period), subject to certain conditions
and limitations.
"Supplemental Credit Enhancement
Event" will occur the first time the
long-term debt or deposit rating
of Greenwood (or an additional
seller, if any) is withdrawn or
reduced below BBB - by Standard &
Poor's Ratings Services.
"Series Investor Interest" will mean
$526,316,000 minus (i) the aggregate
amount on deposit with respect to
principal collections for the benefit
of holders of the Class A
Certificates and Class B Certificates
(after giving effect to losses of
principal on investments of funds),
(ii) the aggregate amount of
principal paid to holders of the
Class A Certificates and Class B
Certificates and (iii) the aggregate
amount of unreimbursed investor
losses resulting from accounts in
which the receivables have been
charged-off as uncollectible (after
giving effect to all provisions in
the Series Supplement to reimburse
such charged-off amounts).
"Due Period" will mean, with respect
to any Distribution Date, the
calendar month next preceding the
calendar month in which such
Distribution Date occurs.
THE RECEIVABLES ...................... The receivables in the Accounts (as
defined below) as of July 1, 1998
totaled $21,086,742,705.80.
GROUP EXCESS SPREAD .................. The Investor Certificates initially
will be included in the "Group One"
group of series. The three-month
rolling average Group Excess Spread
Percentage (as defined below) is
3.59% for the Distribution Date in
July 1998.
</TABLE>
3
<PAGE> 4
"Group Excess Spread Percentage" for
any Distribution Date is a percentage
calculated by multiplying (i) an
amount for all series in Group One
equal to (a) the sum of finance
charge collections, investment income
and other collections allocable to
each such series, minus (b) the sum
of certificate interest and certain
fees payable with respect to each
such series and the amount of
receivables allocable to each such
series which have been charged-off as
uncollectible, by (ii) twelve, and
then dividing the product by an
amount equal to the sum of all
investor interests for each series in
Group One (in each case for the
Distribution Date).
RATING OF THE INVESTOR CERTIFICATES .. It is a condition of issuance that
the Class A Certificates be rated
"AAA" and "Aaa" by Standard &
Poor's and Moody's, respectively, and
that the Class B Certificates be
rated at least "A" and "A2" or the
equivalent by Standard & Poor's and
Moody's, respectively.
ERISA CONSIDERATIONS ................. It is expected that the assets of an
ERISA plan that invests in the Class
A Certificates would not be
deemed to include an interest in the
assets of the Trust. The Class B
Certificates may not be acquired by
any employee benefit plan that is
subject to ERISA.
LISTING .............................. Application will be made to list the
Investor Certificates on the
Luxembourg Stock Exchange.
COMPOSITION OF THE ACCOUNTS
Information concerning the composition of the accounts from which
receivables are included in the Trust (the "Accounts") is set forth below.
4
<PAGE> 5
GEOGRAPHIC DISTRIBUTION. As of July 1, 1998, the five states with the
largest receivables balances were as follows:
<TABLE>
<CAPTION>
STATE PERCENTAGE OF TOTAL RECEIVABLES
----- BALANCE IN THE ACCOUNTS
-----------------------
<S> <C>
California.............. 11.8%
Texas................... 9.3%
New York................ 6.8%
Florida................. 5.8%
Illinois................ 4.9%
</TABLE>
CREDIT LIMIT INFORMATION. Credit limit information as of July 1, 1998
with respect to the Accounts is as follows:
<TABLE>
<CAPTION>
PERCENTAGE
RECEIVABLES OF TOTAL
OUTSTANDING RECEIVABLES
CREDIT LIMIT (000'S) OUTSTANDING
- ------------ ------- -----------
<S> <C> <C>
Less than or equal to $1,000.00............. $ 507,859 2.4%
$1,000.01 to $2,000.00...................... $ 2,775,297 13.2%
$2,000.01 to $3,000.00...................... $ 2,968,897 14.1%
Over $3,000.00.............................. $14,834,690 70.3%
----------- ------
Total..................................... $21,086,743 100.0%
=========== ======
</TABLE>
SEASONING. As of July 1, 1998, 83.8% of the Accounts were at least 24
months old. The distribution of the age of Accounts as of July 1, 1998 was as
follows:
<TABLE>
<CAPTION>
PERCENTAGE PERCENTAGE
AGE OF ACCOUNTS OF ACCOUNTS OF BALANCES
--------------- ----------- -----------
<S> <C> <C>
Less than 12 Months......... 6.0% 3.4%
12 to 23 Months............. 10.2% 10.6%
24 to 35 Months............. 15.7% 16.6%
36 Months and Greater....... 68.1% 69.4%
------ ------
100.0% 100.0%
====== ======
</TABLE>
SUMMARY CURRENT DELINQUENCY INFORMATION. Current delinquency information
as of July 1, 1998 with respect to the Accounts is summarized as follows:
<TABLE>
<CAPTION>
AGGREGATE
BALANCES PERCENTAGE
PAYMENT STATUS (000'S) OF BALANCES
-------------- ------- -----------
<S> <C> <C>
Current..................... $17,968,794 85.2%
1 to 29 Days................ $1,596,816 7.6%
30 to 59 Days............... $577,733 2.7%
60 to 89 Days............... $334,940 1.6%
90 to 119 Days.............. $276,128 1.3%
120 to 149 Days............. $163,747 0.8%
150 to 179 Days............. $168,585 0.8%
----------- ------
$21,086,743 100.0%
=========== ======
</TABLE>
5
<PAGE> 6
COMPOSITION AND HISTORICAL PERFORMANCE
OF THE DISCOVER CARD PORTFOLIO
GEOGRAPHIC DISTRIBUTION. The Discover Card Portfolio is not concentrated
geographically. As of May 31, 1998, the five states with the largest
receivables balances were as follows:
<TABLE>
<CAPTION>
PERCENTAGE OF TOTAL RECEIVABLES BALANCE
OF DISCOVER CARD PORTFOLIO
STATE AS OF MAY 31, 1998
----- ---------------------------------------
<S> <C>
California.............. 11.4%
Texas................... 9.3%
New York................ 6.7%
Florida................. 5.8%
Illinois................ 5.0%
</TABLE>
No other state accounted for more than 5% of the total receivables balance
of the Discover Card Portfolio as of May 31, 1998.
CREDIT LIMIT INFORMATION. Credit limit information as of May 31, 1998
with respect to the Discover Card Portfolio is summarized as follows:
<TABLE>
<CAPTION>
PERCENTAGE
RECEIVABLES OF TOTAL
OUTSTANDING RECEIVABLES
CREDIT LIMIT (000'S) OUTSTANDING
------------ ----------- -----------
<S> <C> <C>
Less than or equal to $1,000.00........ $ 605,182 2.1%
$1,000.01 to $2,000.00................. 3,447,277 11.7%
$2,000.01 to $3,000.00................. 3,679,106 12.5%
Over $3,000.00......................... $21,636,206 73.7%
----------- ------
Total................................. $29,367,771 100.0%
=========== ======
</TABLE>
SEASONING. As of May 31, 1998, 86.8% of the accounts in the Discover Card
Portfolio were at least 24 months old. The distribution of the age of accounts
in the Discover Card Portfolio as of May 31, 1998 was as follows:
<TABLE>
<CAPTION>
PERCENTAGE PERCENTAGE
AGE OF ACCOUNTS OF ACCOUNTS OF BALANCES
--------------- ----------- -----------
<S> <C> <C>
Less than 12 Months............. 5.6% 3.2%
12 to 23 Months................. 7.6% 8.0%
24 to 35 Months................. 11.7% 12.4%
36 Months and Greater........... 75.1% 76.4%
------ ------
100.0% 100.0%
====== ======
</TABLE>
6
<PAGE> 7
SUMMARY YIELD INFORMATION. The annualized aggregate monthly yield for the
Discover Card Portfolio is summarized as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED ELEVEN MONTHS ENDED TWELVE MONTHS ENDED TWELVE MONTHS ENDED
MAY 31, 1998 NOVEMBER 30, 1997 DECEMBER 31, 1996 DECEMBER 31, 1995
---------------- ------------------- ------------------- -------------------
<S> <C> <C> <C> <C>
Aggregate Monthly Yields (1)
Excluding Recoveries (2) 17.68% 18.19% 17.72% 16.95%
Including Recoveries (3) 18.39% 18.90% 18.20% 17.39%
</TABLE>
(1) Monthly Yield is calculated by dividing monthly finance charges billed by
beginning monthly balance. Monthly finance charges include periodic
finance charges, cash advance item charges, late fees, and as of March 1,
1996, overlimit fees, but exclude certain other items, such as annual
membership fees, if any, which are included in finance charge receivables
for the Trust. Aggregate Monthly Yield is the average of monthly yields
annualized for each period shown.
(2) Monthly Yield excluding any recoveries received with respect to
charged-off accounts.
(3) Monthly Yield including recoveries received with respect to charged-off
accounts. Recoveries received with respect to charged-off accounts
(including the proceeds of sales of receivables in charged-off accounts by
the Trust, but excluding any such proceeds with respect to any accounts
that have been removed from the Trust) are included in the Trust and are
treated as finance charge collections.
SUMMARY CURRENT DELINQUENCY INFORMATION. Current delinquency information
as of May 31, 1998 with respect to the Discover Card Portfolio is summarized as
follows:
<TABLE>
<CAPTION>
AGGREGATE
BALANCES PERCENTAGE
PAYMENT STATUS (000'S) OF BALANCES
-------------- ------- -----------
<S> <C> <C>
Current......................... $25,082,627 85.4%
1 to 29 Days.................... $ 2,237,591 7.6%
30 to 59 Days................... $ 765,526 2.6%
60 to 89 Days................... $ 498,072 1.7%
90 to 119 Days.................. $ 273,520 0.9%
120 to 149 Days................. $ 270,871 0.9%
150 to 179 Days................. $ 239,564 0.9%
----------- ----
$29,367,771 100.0%
=========== =====
</TABLE>
7
<PAGE> 8
SUMMARY HISTORICAL DELINQUENCY INFORMATION. Historical delinquency
information with respect to the Discover Card Portfolio is summarized as
follows:
<TABLE>
<CAPTION>
AVERAGE OF SIX MONTHS AVERAGE OF ELEVEN MONTHS AVERAGE OF TWELVE MONTHS
ENDED MAY 31, 1998 ENDED NOVEMBER 30, 1997 ENDED DECEMBER 31, 1996
-------------------------- ---------------------------- ----------------------------
DELINQUENT DELINQUENT DELINQUENT
AMOUNT AMOUNT AMOUNT
(000'S) PERCENTAGE(1) (000'S) PERCENTAGE (1) (000'S) PERCENTAGE (1)
----------- ------------- ------------ -------------- ------------ --------------
<S> <C> <C> <C> <C> <C> <C>
30-59 Days......... $772,889 2.6% $ 743,464 2.6% $ 680,645 2.7%
60-89 Days......... $443,442 1.5% $ 432,410 1.5% $ 361,992 1.4%
90-179 Days........ $853,276 2.8% $ 803,204 2.8% $ 593,661 2.3%
----------- ------------- ------------ -------------- ------------ --------------
Total............ $2,069,607 6.9% $1,979,078 6.9% $1,636,298 6.4%
=========== ------------- ============ ============== ============ ==============
</TABLE>
<TABLE>
<CAPTION>
AVERAGE OF TWELVE MONTHS
ENDED DECEMBER 31, 1995
-----------------------------------
DELINQUENT
AMOUNT
(000'S) PERCENTAGE(1)
-------------------- -------------
<S> <C> <C>
30-59 Days......... $ 568,382 2.6%
60-89 Days......... $ 276,821 1.3%
90-179 Days........ $ 403,134 1.8%
-------------------- -------------
Total............ $1,248,337 5.7%
==================== =============
</TABLE>
(1) The percentages are the result of dividing Delinquent Amount by Average
Receivables Outstanding for the applicable period. Delinquent Amount is
the average of the monthly ending balances of delinquent accounts during
the periods indicated. Average Receivables Outstanding is the average of
the monthly average amount of receivables outstanding during the periods
indicated.
SUMMARY CHARGE-OFF INFORMATION. Charge-off information with respect to
the Discover Card Portfolio is summarized as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED ELEVEN MONTHS ENDED TWELVE MONTHS ENDED TWELVE MONTHS ENDED
MAY 31, 1998 NOVEMBER 30, 1997 DECEMBER 31, 1996 DECEMBER 31, 1995
------------------ ------------------- ------------------- -------------------
(dollars in thousands)
<S> <C> <C> <C> <C>
Average Receivable Outstanding(1)....... $29,972,283 $28,403,076 $25,542,718 $22,031,829
Gross Charge-Offs....................... $ 1,122,113 $ 1,891,601 $ 1,458,450 $ 923,836
Gross Charge-Offs as a Percentage of
Average Receivables Outstanding(2).... 7.49% 7.27% 5.71% 4.19%
</TABLE>
(1) Average Receivables Outstanding is the average of the monthly average
amount of receivables outstanding during the periods indicated.
(2) Recoveries with respect to charged-off receivables in the Accounts (other
than the proceeds of sales of charged-off accounts that have been removed
from the Trust) are property of the Trust and are treated as finance
charge collections.
SUMMARY PAYMENT RATE INFORMATION (1). The monthly rate of payments in the
Discover Card Portfolio is summarized as follows:
<TABLE>
<CAPTION>
SIX MONTHS ENDED ELEVEN MONTHS ENDED TWELVE MONTHS ENDED TWELVE MONTHS ENDED
MAY 31, 1998 NOVEMBER 30, 1997 DECEMBER 31, 1996 DECEMBER 31, 1995
---------------- ------------------- ------------------- -------------------
<S> <C> <C> <C> <C>
Average Monthly Payment Rate(2)........ 15.06% 14.51% 15.24% 16.20%
High Monthly Payment Rates............. 16.11% 16.31% 18.08% 18.97%
Low Monthly Payment Rates.............. 13.90% 12.41% 13.33% 13.67%
</TABLE>
(1) Monthly Payment Rate is calculated by dividing monthly cardmember
remittances by the cardmember receivables balance outstanding as of the
beginning of the month.
(2) Average Monthly Payment Rate for a period is equal to the sum of
individual monthly payment rates for the period divided by the number of
months in the period.
8
