<PAGE> 1
PROSPECTUS SUPPLEMENT TO PROSPECTUS DATED OCTOBER 19, 1999
--------------------
[FLEET LOGO]
FLEET CREDIT CARD MASTER TRUST II
ISSUER
FLEET BANK (RI), NATIONAL ASSOCIATION
SELLER AND SERVICER
$252,750,000 CLASS A 6.90% ASSET-BACKED CERTIFICATES, SERIES 1999-C
$20,250,000 CLASS B 7.20% ASSET-BACKED CERTIFICATES, SERIES 1999-C
<TABLE>
<CAPTION>
CLASS A CERTIFICATES CLASS B CERTIFICATES
-------------------- --------------------
<S> <C> <C>
Certificate rate 6.90% annually 7.20% annually
Interest paid Monthly, beginning Monthly, beginning
December 15, 1999 December 15, 1999
Expected final distribution date October 15, 2004 October 15, 2004
Legal final maturity April 16, 2007 April 16, 2007
Price to public per certificate 99.82833% 99.74489%
Underwriting discount per 0.300% 0.350%
certificate
Proceeds to seller per certificate 99.52833% 99.39489%
</TABLE>
The total price to public is $272,514,444. The total amount of the underwriting
discount is $829,125. The total amount of proceeds plus accrued interest and
before deduction of expenses is $271,685,319.
CONSIDER CAREFULLY THE RISK FACTORS BEGINNING ON PAGE S-9 IN THIS PROSPECTUS
SUPPLEMENT
AND PAGE 8 IN THE PROSPECTUS.
The certificates are not deposits and neither the certificates nor the
underlying accounts or receivables are insured or guaranteed by the Federal
Deposit Insurance Corporation or any other governmental agency.
The certificates will represent interests in the trust only and will not
represent interests in or obligations of Fleet Bank (RI), National Association
or any of its affiliates.
CREDIT ENHANCEMENT:
- - The Class B certificates will be subordinated to the Class A certificates.
- - The Trust is also issuing a collateral interest in the amount of $27,000,000.
The collateral interest will be subordinated to both the Class A certificates
and the Class B certificates.
NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED THESE CERTIFICATES OR DETERMINED THAT
THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS IS ACCURATE OR COMPLETE. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
Underwriters of the Class A Certificates
SALOMON SMITH BARNEY
CREDIT SUISSE FIRST BOSTON
LEHMAN BROTHERS
MERRILL LYNCH & CO.
Underwriters of the Class B Certificates
SALOMON SMITH BARNEY LEHMAN BROTHERS
October 22, 1999
<PAGE> 2
IMPORTANT NOTICE ABOUT INFORMATION PRESENTED IN THIS
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS
We provide information to you about the Series 1999-C certificates in two
separate documents that progressively provide more detail: (a) the accompanying
prospectus, which provides general information, some of which may not apply to
your Series 1999-C certificates and (b) this prospectus supplement, which
describes the specific terms of your Series 1999-C certificates. This prospectus
supplement may be used to sell the Class A certificates and the Class B
certificates only if accompanied by the prospectus.
This prospectus supplement and the prospectus relate to the offering of
Class A certificates and Class B certificates only. The collateral interest is
not offered by this prospectus supplement and prospectus.
IF THE TERMS OF YOUR CERTIFICATES VARY BETWEEN THIS PROSPECTUS SUPPLEMENT
AND THE ACCOMPANYING PROSPECTUS, YOU SHOULD RELY ON THE INFORMATION IN THIS
PROSPECTUS SUPPLEMENT.
We include cross references in this prospectus supplement and the
accompanying prospectus to captions in these materials where you can find
further related discussions. The following table of contents and the table of
contents in the accompanying prospectus provide the pages on which these
captions are located.
You can find a listing of the pages where capitalized terms used in this
prospectus supplement and the accompanying prospectus are defined under the
caption "Index of Principal Terms" beginning on page S-47 in this document and
under the caption "Index of Principal Terms" beginning on page 66 in the
accompanying prospectus.
----------------------
S-2
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
SUMMARY OF TERMS...................... S-4
The Trust........................... S-4
The Trustee......................... S-4
Seller And Servicer................. S-4
Seller........................... S-4
Servicer......................... S-4
The Bank......................... S-4
The Receivables..................... S-4
Offered Securities.................. S-4
Certificates..................... S-4
Distribution Dates............... S-4
Interest......................... S-4
Principal........................ S-5
The Collateral Interest............. S-5
Credit Enhancement.................. S-5
Subordination of Classes......... S-5
The Sellers' Interest............... S-5
Allocations......................... S-6
Among Series..................... S-6
Among Classes.................... S-6
Application Of Collections.......... S-6
Finance Charge Collections....... S-6
Excess Spread and Excess Finance
Charges........................ S-6
Principal Collections............ S-7
Pay Out Events...................... S-7
Optional Repurchase................. S-8
Registration........................ S-8
Tax Status.......................... S-8
ERISA Considerations................ S-8
Certificate Ratings................. S-8
Exchange Listing.................... S-8
Additional Information.............. S-8
RISK FACTORS.......................... S-9
Ability To Resell Series 1999-C
Certificates Not Assured......... S-9
Credit Enhancement May Not Be
Sufficient To Prevent Loss....... S-9
Class B Certificates Are
Subordinated To The Class A
Certificates; Trust Assets May Be
Diverted From Class B To Pay
Class A.......................... S-9
Ratings Can Be Lowered Or Withdrawn
After You Purchase Your
Certificates And The Market Value
Of Your Certificates May Be
Reduced.......................... S-10
INTRODUCTION.......................... S-11
</TABLE>
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
THE BANK'S CREDIT CARD ACTIVITIES..... S-12
General............................. S-12
Finance Charges..................... S-12
Delinquency and Loss Experience..... S-12
Interchange......................... S-14
Year 2000 Readiness................. S-14
Litigation.......................... S-15
THE RECEIVABLES....................... S-15
MATURITY ASSUMPTIONS.................. S-19
RECEIVABLE YIELD CONSIDERATIONS....... S-21
DESCRIPTION OF THE CERTIFICATES....... S-22
General............................. S-22
Registration of Certificates........ S-23
Interest Payments................... S-23
Principal Payments.................. S-25
Postponement of Accumulation
Period........................... S-26
Subordination....................... S-27
Allocation Percentages.............. S-27
Reallocation of Cash Flows.......... S-30
Application of Collections.......... S-31
Principal Funding Account........... S-36
Reserve Account..................... S-36
Paired Series....................... S-37
Shared Collections of Principal
Receivables...................... S-38
Allocation of Investor Default
Amount........................... S-38
Optional Repurchase................. S-39
Pay Out Events...................... S-40
Servicing Compensation and Payment
of Expenses...................... S-41
FEDERAL INCOME TAX CONSEQUENCES....... S-41
ERISA CONSIDERATIONS.................. S-42
General............................. S-42
Class A Certificates................ S-42
Class B Certificates................ S-44
Consultation with Counsel........... S-44
UNDERWRITING.......................... S-45
LEGAL MATTERS......................... S-46
INDEX OF PRINCIPAL TERMS.............. S-47
ANNEX I: OTHER SERIES ISSUED.......... I-1
ANNEX II: RECEIVABLES IN ADDITIONAL
ACCOUNTS CONVEYED TO THE TRUST...... II-1
</TABLE>
S-3
<PAGE> 4
SUMMARY OF TERMS
THIS SUMMARY HIGHLIGHTS SELECTED INFORMATION FROM THIS DOCUMENT AND DOES NOT
CONTAIN ALL OF THE INFORMATION THAT YOU NEED TO CONSIDER IN MAKING YOUR
INVESTMENT DECISION. THIS SUMMARY PROVIDES GENERAL, SIMPLIFIED DESCRIPTIONS OF
MATTERS WHICH, IN SOME CASES, ARE HIGHLY TECHNICAL AND COMPLEX. MORE DETAIL IS
PROVIDED IN OTHER SECTIONS OF THIS DOCUMENT AND IN THE PROSPECTUS.
DO NOT RELY UPON THIS SUMMARY FOR A FULL UNDERSTANDING OF THE MATTERS YOU NEED
TO CONSIDER IN CONNECTION WITH ANY POTENTIAL INVESTMENT IN THE SERIES 1999-C
CERTIFICATES. TO UNDERSTAND ALL OF THE TERMS OF THE OFFERING OF THE SERIES
1999-C CERTIFICATES, READ CAREFULLY THIS ENTIRE DOCUMENT AND THE ACCOMPANYING
PROSPECTUS.
THE TRUST
Fleet Credit Card Master Trust II will issue the certificates.
The trust has issued numerous series of certificates, will issue the Series
1999-C certificates and expects to issue additional series. The certificates of
each series will represent an ownership interest in the assets of the trust.
THE TRUSTEE
The trustee is Bankers Trust Company.
SELLER AND SERVICER
SELLER
Fleet Bank (RI), National Association originates and acquires credit card
accounts. As seller, the bank sells the receivables to the trust.
SERVICER
The bank also is the servicer. As the servicer, the bank collects payments on
the receivables and allocates the collections among the interests in the trust.
THE BANK
The bank is a special purpose credit card bank. Its principal offices are
located at 111 Westminster Street, Providence, Rhode Island 02903. The telephone
number is (401) 278-5451.
THE RECEIVABLES
The primary assets of the trust are receivables in MasterCard(R) and VISA(R)(1)
revolving credit card accounts. The receivables consist of principal receivables
and finance charge receivables.
- ---------------
(1) MasterCard(R) and VISA(R) are federally registered servicemarks of
MasterCard International Inc. and VISA U.S.A., Inc. respectively.
The following information is as of September 30, 1999:
- - Principal receivables in the trust: $10,569,335,173.
- - Finance charge receivables in the trust: $279,872,747.
- - Accounts designated to the trust: 6,689,259.
See "The Receivables" in this prospectus
supplement.
OFFERED SECURITIES
CERTIFICATES
Fleet Credit Card Master Trust II is offering:
- - $252,750,000 of Class A certificates; and
- - $20,250,000 of Class B certificates.
The Series 1999-C certificates include both Class A and Class B.
Beneficial interests in these certificates may be purchased in minimum
denominations of $1,000 and integral multiples of $1,000.
The seller expects that the trust will issue the Series 1999-C certificates on
November 3, 1999.
DISTRIBUTION DATES
The first distribution date will be December 15, 1999.
Distribution dates for the Series 1999-C certificates will be the 15th day of
each month if the 15th day is a business day. If the 15th is not a business day,
the distribution date will be the following business day.
INTEREST
Interest on the Series 1999-C certificates will be paid on each distribution
date.
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<PAGE> 5
Class A
The Class A certificates will bear interest at 6.90% per annum.
Class B
The Class B certificates will bear interest at 7.20% per annum.
PRINCIPAL
The seller expects that principal on the Series 1999-C certificates will be
distributed on the date noted below; however, principal may, in fact, be
distributed earlier or later. You will not be entitled to any premium for early
or late payment of principal.
If certain adverse events known as pay out events occur, principal may be
distributed earlier than expected.
If collections of the credit card receivables are less than expected or are
collected more slowly than expected, then principal repayment may be delayed.
Class A
The seller expects that principal of the Class A certificates will be
distributed on the October 2004 distribution date.
Class B
The seller expects that principal of the Class B certificates will be
distributed on the October 2004 distribution date; however, no principal will be
paid on the Class B certificates unless the Class A certificates are paid in
full.
Accumulation Period
We are scheduled to begin accumulating collections of principal receivables on
January 1, 2004 for later distribution to you. The servicer may, however, elect
to delay the beginning of the accumulation period to a date not later than
September 1, 2004.
See "Description of the Certificates--Principal
Payments," and "--Postponement of
Accumulation Period" in this prospectus
supplement.
Legal Final Maturity
If the Series 1999-C certificates are not paid on their expected final
distribution dates, collections of receivables will continue to be used to pay
principal on the Series 1999-C certificates until the certificates are paid or
until April 16, 2007, whichever occurs first. April 16, 2007 is the legal final
maturity date for Series 1999-C.
See "Maturity Assumptions," and "Description of the Certificates--Allocation
Percentages," and "--Principal Payments" in this prospectus supplement.
THE COLLATERAL INTEREST
At the same time as the Series 1999-C certificates are issued, the trust will
issue an undivided interest in the trust called a collateral interest in the
amount of $27,000,000 as part of Series 1999-C. The holder of the collateral
interest will have voting and certain other rights as if the collateral interest
were a subordinated class of certificates. The collateral interest is not
offered by this document.
CREDIT ENHANCEMENT
SUBORDINATION OF CLASSES
The collateral interest and the Class B certificates are subordinated to the
Class A certificates.
The collateral interest is also subordinated to the Class B certificates.
See "Description of the Certificates--Reallocation of Cash Flow" and
"--Allocation of Investor Default Amount" in this prospectus supplement.
THE SELLERS' INTEREST
The interest in the trust not represented by your series or by any other series
is the sellers' interest. The sellers' interest is represented by the seller
certificates, including the bank certificate and any supplemental certificates.
The bank certificate is held by the bank. The bank may sell a portion of the
sellers' interest to other investors. If a portion of the sellers' interest is
sold to anyone other than the seller or its affiliates, the interest will be
represented by a supplemental certificate. No supplemental certificates are
currently outstanding.
The sellers' interest does not provide credit enhancement for your series or any
other series.
S-5
<PAGE> 6
ALLOCATIONS
AMONG SERIES
Each month the bank, as servicer, will allocate collections received among:
- - Series 1999-C;
- - other outstanding series; and
- - the sellers' interest in the trust.
The amount allocated to your series will be determined based mainly upon the
ratio of the invested amount of your series to the total amount of principal
receivables in the trust.
You are entitled to receive payments of interest and principal only from
collections and other trust assets allocated to your series.
The invested amount is the primary basis for allocations to your series. The
invested amount is the sum of the Class A invested amount, the Class B invested
amount and the collateral invested amount.
At the time of issuance of the Series 1999-C certificates, the invested amount
for Series 1999-C will be $300,000,000.
AMONG CLASSES
From the amounts allocated to your series, the servicer will further allocate
among the Class A certificates, the Class B certificates and the collateral
interest on the basis of the invested amount of each class and the invested
amount of the collateral interest. Initially the invested amount of each class
will be equal to the original principal amount of such class and the initial
invested amount of the collateral interest will be equal to the original
principal amount of the collateral interest.
See "Description of the Certificates--Allocation Percentages" in this prospectus
supplement.
The invested amount of a series or a class will decline as a result of the
accumulation of principal collections in the principal funding account or
principal payments. The invested amount also may decline if collections of
receivables allocated to your series are not sufficient to make certain required
payments. If the invested amount of your series or class declines, there may be
a reduction in amounts allocated and available for payment to you.
For a description of the events which may lead to these reductions, see
"Description of the Certificates--Reallocation of Cash Flows" in this prospectus
supplement.
APPLICATION OF COLLECTIONS
FINANCE CHARGE COLLECTIONS
- - Collections of finance charge receivables and certain other amounts allocated
to the Class A certificates will be used to pay interest on the Class A
certificates, to pay Class A's portion of the servicing fee and to cover Class
A's portion of receivables that are written off as uncollectible. Any
remaining amount will become excess spread and be applied as described below.
- - Collections of finance charge receivables allocated to the Class B
certificates will be used to pay interest on the Class B certificates and to
pay Class B's portion of the servicing fee. Any remaining amount will become
excess spread and be applied as described below.
- - Collections of finance charge receivables allocated to the collateral interest
will be used to pay the collateral interest's portion of the servicing fee if
the bank or the trustee is no longer the servicer. Any remaining amount will
become excess spread and be applied as described below.
See "Description of the Certificates--Application of Collections--Payment of
Interest, Fees and Other Items" in this prospectus supplement.
EXCESS SPREAD AND EXCESS FINANCE CHARGES
Each month the excess spread and excess finance charges will be used in the
following order of priority:
- - first to make up deficiencies for Class A,
- - then to make up deficiencies for Class B, including covering Class B's portion
of receivables written off as uncollectible,
- - then to pay interest on the collateral interest at the collateral minimum
interest rate,
- - then to pay the collateral interest's portion of the servicing fee, or, if the
bank or the trustee is no longer the servicer, then to pay any portion of the
collateral interest's servicing fee not paid as described above under
"--Finance Charge Collections,"
S-6
<PAGE> 7
- - then to cover the collateral interest's portion of receivables that are
written off as uncollectible,
- - then to reimburse any previous reductions in the collateral invested amount,
- - then, in limited circumstances, to fund a reserve account to cover interest
payment shortfalls for Class A, and
- - finally to make payments to the holder of the collateral interest.
See "Description of the Certificates--Application of Collections--Excess Spread;
Excess Finance Charges" in this prospectus supplement.
PRINCIPAL COLLECTIONS
So long as no pay out event has occurred, your series' share of principal
collections, including shared principal collections from other series, will be
applied each month as follows:
- - First, principal collections allocated to the collateral interest and the
Class B certificates may be reallocated, if necessary, to make required
payments on the Class A certificates and the Class B certificates which were
not made from finance charge collections, excess spread or excess finance
charges.
- - During the revolving period, no principal will be paid to you or accumulated
in a trust account.
- - During the accumulation period, principal collections allocated or available
to the Class A certificates and the Class B certificates will be deposited in
the principal funding account, up to a controlled deposit amount, for payment
first to the Class A certificateholders and then to the Class B
certificateholders on the expected final distribution date.
- - Upon payment in full of the Class A certificates and the Class B certificates,
principal collections allocated or available to the collateral interest, up to
the collateral invested amount, will be paid to the collateral interest
holder.
- - Any remaining principal collections will be first made available to other
series and then paid to the holders of the seller certificates or deposited in
the excess funding account.
If a pay out event occurs, the rapid amortization period will begin and all of
the principal collections allocated or available to the Class A certificates and
the Class B certificates, except amounts required to be reallocated, will be
applied each month to pay principal on your series. Class A will be paid first,
and then Class B.
See "Description of the Certificates--Principal Payments," "--Application of
Collections" and "--Shared Collections of Principal Receivables" in this
prospectus supplement.
PAY OUT EVENTS
Pay out events are adverse events that result in the end of the revolving period
or the accumulation period and the beginning of a rapid amortization period.
The following are pay out events:
- - the seller fails to make required payments, fails to make required deposits,
or violates other covenants and agreements;
- - the representations and warranties of the seller are materially incorrect;
- - the seller does not transfer additional assets to the trust when required;
- - the percentage obtained from your series allocation of the yield on the trust
portfolio and investment earnings from the principal funding account and
withdrawals from the reserve account, after taking into account the amount of
the receivables that are written off as uncollectible allocated to Series
1999-C, averaged over any three consecutive months is less than the weighted
average interest rate for Series 1999-C, calculated by taking into account the
interest rate for Class A, Class B and the collateral minimum interest rate,
plus the servicing fee rate for Series 1999-C averaged over the same three
months;
- - certain defaults of the servicer;
- - the Class A certificates, the Class B certificates or the collateral interest
are not paid in full on their expected final distribution date;
- - the occurrence of certain events of insolvency or receivership relating to the
seller, including any additional sellers;
- - the seller is unable to transfer receivables to the trust as required under
the pooling and servicing agreement; or
S-7
<PAGE> 8
- - the trust becomes an "investment company" under the Investment Company Act of
1940.
For a more detailed discussion of the pay out events, see "Description of the
Certificates--Pay Out Events" in this prospectus supplement. In addition, see
"Description of the Certificates--Trust Pay Out Events" in the accompanying
prospectus.
OPTIONAL REPURCHASE
The bank has the option to repurchase your certificates when the investor amount
for your series has been reduced to 5% or less of the initial invested amount.
See "Description of the Certificates--Optional Repurchase" in this prospectus
supplement and "Risk Factors--If Optional Repurchase Occurs, it Will Result in
an Early Return of Principal and a Reinvestment Risk" in the accompanying
prospectus.
REGISTRATION
The Series 1999-C certificates will be in book-entry form and will be registered
in the name of Cede & Co., as the nominee of The Depository Trust Company.
Except in certain limited circumstances, you will not receive a definitive
certificate representing your interest.
See "Description of the Certificates--Definitive Certificates" in the
accompanying prospectus.
You may elect to hold your certificates through DTC in the United States, or
Cedelbank, societe anonyme or the Euroclear System in Europe.
See "Description of the Certificates--Book-Entry Registration" and "--Definitive
Certificates" in the accompanying prospectus.
TAX STATUS
Orrick, Herrington & Sutcliffe LLP, as special tax counsel to the bank, is of
the opinion that under existing law your certificates will be characterized as
debt for federal income tax purposes. By your acceptance of a Series 1999-C
certificate, you will agree to treat your certificates as debt for federal,
state and local income and franchise tax purposes.
See "Federal Income Tax Consequences" in the accompanying prospectus for
additional information concerning the application of federal income tax laws.
ERISA CONSIDERATIONS
Subject to important considerations described under "ERISA Considerations" in
this prospectus supplement and in the accompanying prospectus, the Class A
certificates are eligible for purchase by persons investing assets of employee
benefit plans or individual retirement accounts.
For the reasons discussed under "ERISA Considerations" in this prospectus
supplement and the accompanying prospectus, the Class B certificates are not
eligible for purchase by persons investing assets of employee benefit plans or
individual retirement accounts other than an insurance company investing assets
of its general account.
CERTIFICATE RATINGS
The Class A certificates will be rated in the highest rating category by at
least one nationally recognized rating organization and the Class B certificates
will be rated in one of the three highest rating categories by at least one
nationally recognized rating organization.
See "Risk Factors--Ratings Can Be Lowered or Withdrawn After You Purchase Your
Certificates And The Market Value Of Your Certificates May Be Reduced" in this
prospectus supplement.
EXCHANGE LISTING
We will apply to list the Class A certificates and the Class B certificates on
the Luxembourg Stock Exchange. We cannot guaranty that the application for the
listing will be accepted. You should consult with Bankers Trust Luxembourg S.A.,
the Luxembourg listing agent for the certificates, 14 Boulevard F.D. Roosevelt,
L-2450 Luxembourg, phone number (352) 46 02 41, to determine whether or not the
Series 1999-C certificates are listed on the Luxembourg Stock Exchange.
ADDITIONAL INFORMATION
For more information, you can call (215) 444-6800 and direct your inquiries to
the Fleet Credit Card Securitization Department.
S-8
<PAGE> 9
RISK FACTORS
In the accompanying prospectus you will find a section called "Risk
Factors." The information in that section applies generally to all series,
including yours. The information in this section applies more specifically to
your series.
You should consider the risk factors discussed under the caption "Risk
Factors" in the prospectus and the risk factors discussed below in this section
before deciding whether to purchase any of the Series 1999-C certificates.
<TABLE>
<S> <C>
ABILITY TO RESELL SERIES 1999-C If you purchase Series 1999-C certificates, you may not
CERTIFICATES NOT ASSURED be able to sell them. There is currently no secondary
market for the certificates. A secondary market for your
certificates may not develop. If a secondary market does
develop, it may not continue or it may not provide
sufficient liquidity to allow you to resell all or a
part of your certificates if you want to do so. The
underwriters of the Class A certificates and the
underwriter of the Class B certificates may assist in
resales of the certificates, but they are not required
to do so.
CREDIT ENHANCEMENT MAY NOT BE SUFFICIENT Credit enhancement provided for your series of
TO PREVENT LOSS certificates is limited. The only sources of payment for
your certificates are the assets of the trust allocated
to your series. If problems develop with the
receivables, such as an increase in losses on the
receivables or if there are problems in the collection
and transfer of the receivables to the trust, it is
possible that you may not receive the full amount of
interest and principal that you would otherwise receive.
See "Description of the Certificates--Subordination,"
"--Allocation Percentages," "--Reallocation of Cash
Flows" and "--Allocation of Investor Default Amount" in
this prospectus supplement.
CLASS B CERTIFICATES ARE SUBORDINATED TO If you purchase a Class B certificate, your right to
THE CLASS A CERTIFICATES; TRUST ASSETS MAY receive principal payments is subordinated to the
BE DIVERTED FROM CLASS B TO PAY CLASS A payment in full of the Class A certificates. No
principal will be paid to you until the full amount of
principal has been paid on the Class A certificates.
In addition, if Class A's share of collections of
finance charge receivables and certain other amounts
allocated to Series 1999-C, excess spread, excess
finance charges and the collateral interest's share of
principal collections are not sufficient to make all
required payments for the Class A certificates,
collections of principal receivables allocated to Class
B may be diverted to Class A. If this occurs, the Class
B invested amount and future allocations to Class B
would be reduced.
Also, if Class A's share of losses on the receivables
exceeds the collections and credit enhancement available
to cover those losses, and the collateral invested
amount is reduced to zero, the Class B invested amount
will be reduced to avoid reducing the Class A invested
amount. If this occurs, the Class B invested amount and
future allocations to Class B would be reduced.
</TABLE>
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<TABLE>
<S> <C>
As a result of the subordination, you may receive
payments of interest or principal later than you expect
or you may not receive the full amount of expected
principal and interest.
RATINGS CAN BE LOWERED OR WITHDRAWN AFTER The ratings assigned to the Series 1999-C certificates
YOU PURCHASE YOUR CERTIFICATES AND THE are based upon many factors, including the credit
MARKET VALUE OF YOUR CERTIFICATES MAY BE quality of the receivables and the amount of credit
REDUCED enhancement provided. The ratings are not a
recommendation to purchase, hold or sell any of the
Series 1999-C certificates. The ratings also are not
intended and should not be relied upon to determine the
marketability of the Series 1999-C certificates, the
market value of the Series 1999-C certificates or
whether the Series 1999-C certificates are a suitable
investment for you.
Any rating agency may lower its rating or withdraw its
rating entirely if, in the sole judgment of the rating
agency, the credit quality of the certificates has
declined or is in question. If any rating assigned to
your certificates is lowered or withdrawn, the market
value of your certificates may be reduced.
</TABLE>
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<PAGE> 11
INTRODUCTION
The following provisions of this Prospectus Supplement contain more
detailed information concerning the asset backed certificates offered hereby.
The certificates will be issued by Fleet Credit Card Master Trust II (the
"TRUST") pursuant to the terms of an Amended and Restated Pooling and Servicing
Agreement dated as of December 1, 1993, as amended and restated as of May 23,
1994 (as further amended and in effect from time to time, the "MASTER POOLING
AND SERVICING AGREEMENT") originally between a predecessor in interest to Fleet
Bank (RI), National Association, as Seller and Servicer, and Bankers Trust
Company, as trustee (together with any successors, the "TRUSTEE"). Fleet Bank
(RI) National Association (the "BANK"), in its capacity as Seller under the
Master Pooling and Servicing Agreement and the Series Supplement, is referred to
as the "SELLER," and in its capacity as servicer, the Bank is referred to as the
"SERVICER." The term "SELLER" also includes any Additional Sellers as described
under the caption "Description of the Certificates--The Bank Certificate;
Additional Sellers" in the Prospectus. The term "SERVICER"also refers to any
successor to the Bank, as Servicer.
The Bank is an indirect, wholly-owned subsidiary of Fleet Boston
Corporation ("FBC"). FBC is the bank holding company which came into existence
on October 1, 1999 as a result of the merger of Fleet Financial Group, Inc.
("FFG") and BankBoston Corporation. Prior to the merger of FFG and the
BankBoston Corporation, the Bank was an indirect wholly-owned subsidiary of FFG.
See "The Bank and Fleet Boston Corporation" in the accompanying Prospectus.
The Trust will issue $252,750,000 of its Class A 6.90% Asset Backed
Certificates, Series 1999-C (the "CLASS A CERTIFICATES") and $20,250,000 of its
Class B 7.20% Asset Backed Certificates, Series 1999-C (the "CLASS B
CERTIFICATES") and there will be created as part of 1999-C a third class of
interests in the Trust which shall be in the amount of $27,000,000 and be known
as the Collateral Interest, Series 1999-C (the "COLLATERAL INTEREST"). The Class
A Certificates and the Class B Certificates are, collectively, the "SERIES
1999-C CERTIFICATES" or the "CERTIFICATES." The holders of the Class A
Certificates are herein referred to as the "CLASS A CERTIFICATEHOLDERS." The
holders of the Class B Certificates are herein referred to as the "CLASS B
CERTIFICATEHOLDERS" and, together with the Class A Certificateholders are the
"CERTIFICATEHOLDERS." The holder of the Collateral Interest is the "COLLATERAL
INTEREST HOLDER." The Certificateholders, together with the Collateral Interest
Holder are, collectively, the "SERIES 1999-C HOLDERS." The Series 1999-C
Certificates and the Collateral Interest are, collectively, the "SERIES 1999-C
INTERESTS." The Series in which the Series 1999-C Interests are issued is known
as "SERIES 1999-C." The date on which the Series 1999-C Interests are issued is
the "CLOSING DATE." The Closing Date is expected to be November 3, 1999.
The Series 1999-C Interests will be issued pursuant to the Master Pooling
and Servicing Agreement and the Series 1999-C Supplement thereto (the "SERIES
SUPPLEMENT"). The Master Pooling and Servicing Agreement, together with the
Series Supplement, is the "POOLING AND SERVICING AGREEMENT."
Series 1999-C will be the twenty-first Series issued by the Trust. Series
1999-D will be issued substantially concurrently with Series 1999-C and will be
the twenty-second Series issued by the Trust. Of such Series, sixteen, including
Series 1999-C and Series 1999-D, will be outstanding on the Closing Date. Series
1999-C will be the fifteenth Series and Series 1999-D will be the sixteenth
Series outstanding included in a group of Series ("GROUP ONE") issued by the
Trust from time to time. See Annex I. Annex I is hereby incorporated into this
Prospectus Supplement by reference. Additional Series are expected to be issued
from time to time by the Trust.
The Certificates offered by this Prospectus Supplement and the accompanying
Prospectus are investment grade asset backed securities within the meaning of
the Securities Act of 1933, as amended (the "ACT") and the rules promulgated
thereunder.
S-11
<PAGE> 12
THE BANK'S CREDIT CARD ACTIVITIES
GENERAL
The Bank, as the survivor of a November 14, 1997 merger between the Bank
and Fleet Bank (Delaware), National Association, was, prior to the transfer on
February 20, 1998, the owner of a portfolio of credit card accounts originated
or acquired by the Bank or its predecessor (the "FLEET "B" CREDIT CARD
PORTFOLIO"). As discussed in the Prospectus under the caption "The Bank's Credit
Card Activities," on February 20, 1998, Advanta National Bank transferred to the
Bank the ownership interest in substantially all of the accounts in the Advanta
Consumer Credit Card Portfolio. Those accounts transferred to the Bank from
Advanta National Bank plus accounts acquired or originated by the Bank since the
Transfer are herein referred to as the "FLEET "A" CREDIT CARD PORTFOLIO." The
total "FLEET CREDIT CARD PORTFOLIO" includes the Fleet "B" Credit Card Portfolio
and the Fleet "A" Credit Card Portfolio. All Accounts assigned to the Trust
prior to January 31, 1999 were selected from the Fleet "A" Credit Card
Portfolio. Accounts selected from the Fleet "B" Credit Card Portfolio were first
added to the Trust as of January 31, 1999. Since January 31, 1999, accounts
selected for assignment to the Trust have been selected from the entire Fleet
Credit Card Portfolio.
Additional Accounts have been designated for inclusion in the Trust from
time to time as set forth in Annex II. Annex II is hereby incorporated into this
Prospectus Supplement by reference.
As of September 30, 1999, the Fleet "B" Credit Card Portfolio represented
approximately 14% of the total amount of receivables in the Fleet Credit Card
Portfolio.
The Bank is a member of VISA U.S.A. Inc. and MasterCard International
Incorporated.
FINANCE CHARGES
The majority of the accounts in the Fleet Credit Card Portfolio are subject
to finance charges at prime indexed or London interbank offered rate indexed
variable rates ranging from 3.9% to 22.9% for purchases and cash advances. For
more information, see "The Bank's Credit Card Activities--Billing and Payments"
in the accompanying Prospectus.
DELINQUENCY AND LOSS EXPERIENCE
The following tables set forth the delinquency and loss experience for the
Fleet Credit Card Portfolio beginning on February 20, 1998. Information prior to
February 20, 1998 is shown pro forma as if the Bank had purchased the Advanta
Consumer Credit Card Portfolio as of the beginning of 1996.
The Accounts which have been designated to the Trust and the Receivables in
such Accounts as of any date of determination constitute the "TRUST PORTFOLIO."
The Accounts in the Trust Portfolio were, prior to February 20, 1998, selected
from accounts in the Advanta Consumer Credit Card Portfolio and for the period
from February 20, 1998 to January 31, 1999 were selected from the Fleet "A"
Credit Card Portfolio. Commencing on January 31, 1999, Accounts added to the
Trust have been selected from the Fleet "B" Credit Card Portfolio as well as the
Fleet "A" Credit Card Portfolio. In each case, the Accounts selected must meet
the requirements of Eligible Accounts in the Pooling and Servicing Agreement.
See "Description of the Certificates--Representations, Warranties and Covenants"
and "--Addition of Accounts" in the accompanying Prospectus. See also "The
Receivables" in this Prospectus Supplement.
The Trust Portfolio is only a portion of the Fleet Credit Card Portfolio;
therefore, actual delinquency and gross charge-off experience with respect to
the Receivables in the Trust may be different from that set forth in the
following tables for the Fleet Credit Card Portfolio.
There can be no assurance that the delinquency and loss experience for the
Receivables will be similar to the historical experience set forth in the
following tables.
S-12
<PAGE> 13
DELINQUENCY EXPERIENCE
FLEET CREDIT CARD PORTFOLIO
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
AS OF DECEMBER 31,
AS OF SEPTEMBER 30, -----------------------------------------
1999 1998 1997 1996
------------------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Receivables Outstanding(1)(2)..... $13,043,818 $14,524,541 $13,937,589 $15,347,191
Receivables Contractually
Delinquent as a Percentage of
Receivables Outstanding(1):
30-59 days...................... 1.71% 1.58% 1.77% 1.56%
60-89 days...................... 1.14% 1.07% 1.13% 1.03%
90 or more days................. 2.30% 2.29% 2.39% 2.14%
----------- ----------- ----------- -----------
Total............................. 5.15% 4.94% 5.29% 4.73%
=========== =========== =========== ===========
</TABLE>
- ------------
(1) Receivables Outstanding and Receivables Contractually Delinquent include the
Fleet "A" Credit Card Portfolio and Fleet "B" Credit Card Portfolio
beginning on February 20, 1998. Information prior to February 20, 1998 is
shown pro forma as if the Bank had purchased the Advanta Consumer Credit
Card Portfolio as of the beginning of 1996. Receivables Outstanding and
Receivables Contractually Delinquent related to the credit card portfolio
acquired by FFG as a result of the purchase of NatWest Bank, N.A. are
included beginning in June, 1997.
(2) Receivables Outstanding consists of all amounts due from cardholders as
posted to the accounts.
LOSS EXPERIENCE
FLEET CREDIT CARD PORTFOLIO
(DOLLARS IN THOUSANDS)
<TABLE>
<CAPTION>
NINE MONTHS
ENDED YEAR ENDED DECEMBER 31,
SEPTEMBER 30, -----------------------------------------
1999 1998 1997 1996
------------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
Average Receivables
Outstanding(1)(2)............... $12,882,101 $14,380,316 $13,950,913 $14,266,600
Gross Losses(1)(3)................ $ 748,736 $ 1,034,996 $ 1,052,527 $ 572,511
Recoveries(1)..................... $ 56,221 $ 91,664 $ 84,439 $ 28,059
Net Losses........................ $ 692,515 $ 943,332 $ 968,088 $ 544,452
Net Losses as a Percentage of
Average Receivables
Outstanding..................... 7.17%(4)(5) 6.56%(5) 6.94%(5) 3.82%(5)
</TABLE>
- ------------
(1) Average Receivables Outstanding, Gross Losses and Recoveries include the
Fleet "A" Credit Card Portfolio and Fleet "B" Credit Card Portfolio
beginning on February 20, 1998. Information prior to February 20, 1998 is
shown pro forma as if the Bank had purchased the Advanta Consumer Credit
Card Portfolio as of the beginning of 1996. Average Receivables Outstanding,
Gross Losses and Recoveries related to the credit card portfolio acquired by
FFG as a result of the purchase of NatWest Bank, N.A. are included beginning
in June, 1997.
(2) Average Receivables Outstanding is the sum of receivables outstanding at the
beginning and end of each month during the period indicated, divided by
twice the number of months in the period indicated.
(3) Gross Losses are presented net of adjustments made pursuant to the Bank's
normal servicing procedures, including removal of incorrect or disputed
finance charges and reversal of annual cardholder fees on cardholder
accounts which have been closed. Losses do not include accrued finance
charges that have been charged-off or fraud losses.
(4) Annualized.
(5) Beginning in August 1996, a new charge-off methodology related to bankrupt
credit card accounts was adopted and, as of October 1, 1998, further changes
to such methodology were adopted and commencing on October 1, 1998, the Bank
revised its policy concerning the charge-off of delinquent accounts. See
"The Bank's Credit Card Activities--Delinquencies" in the accompanying
Prospectus.
The causes of the increase in the charge-offs from 1996 to 1997 include the
following factors: continuing increases in the level of consumer bankruptcies,
the seasoning of the portfolio and a general trend in the credit card industry
towards higher gross charge-offs. A number of initiatives have been undertaken
to stem losses, including improving the collection process by further
customizing collection methods, more quickly
S-13
<PAGE> 14
identifying and intervening on potentially troubled accounts by means of
advanced computer-based behavior prediction programs and tightening underwriting
standards. The increase in charge-offs during the first nine months of 1999 is
the result of general seasoning of the portfolio.
In February 1999, the Federal Financial Institutions Examination Council
adopted a revised policy statement on the classifications of retail credit. The
revised policy statement provides uniform guidelines for charge-off of loans to
delinquent, bankrupt and deceased borrowers and for reaging, extending,
deferring or rewriting of delinquent accounts. In order to comply with this
policy, the Bank, as Servicer, is accelerating charge-off of some delinquent
loans. Implementation began in April 1999 and will continue through December
1999. The Servicer does not expect this implementation to have an effect upon
the payment of principal and interest on the Certificates. This statement is a
forward-looking statement, subject to risks and uncertainties.
INTERCHANGE
In respect of Interchange attributed to the cardholder charges for
merchandise and services in the Accounts, the Bank will be required, pursuant to
the terms of the Pooling and Servicing Agreement, to transfer to the Trust on
the Business Day immediately preceding each Distribution Date an amount equal to
one-twelfth of 1.25% of the outstanding balance of the Principal Receivables
allocable to Series 1999-C at the end of the last day of the preceding Monthly
Period.
YEAR 2000 READINESS
The Year 2000 project for the Bank's holding company, is directed by a Year
2000 Executive Management Steering Committee consisting of its President and
Vice Chairmen. They provide direct oversight of the Year 2000 initiative and are
updated monthly on the project's progress. The Bank's Board of Directors
receives project updates on a quarterly basis.
The Bank has completed its assessment of Year 2000 issues and arranged for
the required resources to complete the necessary remediation efforts. The Bank
has utilized both internal and external resources to reprogram, or replace, and
test the software and hardware for Year 2000 modifications.
The Bank has remediated, tested and returned to service all of its internal
systems. These systems can process dates and data into the year 2000 and beyond.
The Bank relies on several third party service providers for key business
processes. It continues to work closely with these companies to monitor the
progress of their Year 2000 efforts. On behalf of the Bank, the Bank's holding
company's executive management has conducted on-site visits with its most
critical service providers to discuss and assess their Year 2000 readiness. In
addition, the holding company is receiving written and verbal verification from
its significant third party service providers and vendors as to their Year 2000
readiness.
The Bank began Year 2000 testing with several of these key vendors in the
third quarter of 1998 and completed testing by the end of the second quarter of
1999. Validation of Year 2000 readiness of all the Bank's vendors continues with
a particular focus on their readiness and alternatives, where possible, for
vendors that have been identified as critical.
While the Bank continues to discuss these matters with, obtain written
certification from and test the systems of such other companies as to the Year
2000 compliance, there can be no assurance that any potential impact associated
with incompatible systems after December 31, 1999 would not have a material
adverse effect on the Bank's business, financial condition or results of
operations.
The Bank and its holding company have established business continuity plans
and have assessed these plans for the possible impact of Year 2000 anticipated
failures. The holding company has adjusted its business continuity plans where
appropriate and possible for those scenarios that may have the most severe
impact on its operations. This activity was substantially completed by the end
of the second quarter of 1999 and validation of these plans is complete.
S-14
<PAGE> 15
LITIGATION
On January 22, 1999, Fleet Financial Group, Inc. (the predecessor to Fleet
Boston Corporation), Fleet National Bank, Fleet Bank (RI), National Association,
Fleet Credit Card Services, L.P. and Fleet Credit Card Holdings, Inc.
(collectively referred to as "FLEET") brought suit against Advanta Corp., and
certain of its subsidiaries (collectively referred to as "ADVANTA"). The action
arose out of a February 1998 transaction in which Fleet Financial Group, Inc.
and Fleet Credit Card LLC, the predecessor in interest to Fleet Credit Card
Services, L.P., acquired most of the consumer credit card business of Advanta
National Bank. Advanta answered Fleet's complaint, denying the principal
allegations and asserting a variety of counterclaims.
The litigation is presently in the discovery process. Due to the nature of
Advanta's pleadings, the limited discovery that has occurred to date concerning
Advanta's claims, and the general unpredictability of the litigation process, it
is impossible, at this time, to predict the ultimate outcome of the litigation.
However, Fleet intends to vigorously pursue its claims and contest the claims
asserted by Advanta. Fleet Boston Corporation does not expect this action to
have any material adverse impact on its business.
THE RECEIVABLES
The Receivables in the first Accounts designated to the Trust (the "INITIAL
ACCOUNTS") were conveyed to the Trust on December 3, 1993 (the "INITIAL CLOSING
DATE"). The Initial Accounts were selected from Advanta National Bank's consumer
credit card portfolio satisfying criteria set forth in the Pooling and Servicing
Agreement (the "CRITERIA") as applied on October 31, 1993 (the "INITIAL CUT-OFF
DATE"). Receivables in accounts designated to the Trust after the Initial
Accounts (the "ADDITIONAL ACCOUNTS") have been conveyed to the Trust from time
to time since the Initial Closing Date as set forth in Annex II. Such
Receivables were generated from Additional Accounts selected from the Advanta
Consumer Credit Card Portfolio prior to February 20, 1998, and from the Fleet
"A" Credit Card Portfolio from February 20, 1998 to January 31, 1999, and
commencing on January 31, 1999, Additional Accounts have been selected from the
entire Fleet Credit Card Portfolio, including both the Fleet "A" Credit Card
Portfolio and the Fleet "B" Credit Card Portfolio. In each case such Additional
Accounts are required to satisfy the Criteria as applied on the relevant cut-off
date (the "RELEVANT CUT-OFF DATE"). The Bank has broad discretion in selecting
accounts that will be designated as Additional Accounts. The Criteria are the
requirements for an account to qualify as an "ELIGIBLE ACCOUNT" and are set
forth in the accompanying Prospectus. In order to meet the Criteria, each
Account must, on the Relevant Cut-Off Date, among other things, have been in
existence and maintained by the Bank, have a cardholder with a billing address
in the United States, its territories or possessions or a military address, and,
except under certain circumstances, not be an account the credit card or cards
with respect to which have been reported to the Bank as having been lost or
stolen. See "Description of the Certificates--Representations, Warranties and
Covenants" in the accompanying Prospectus.
Cardholders whose accounts are included in the Fleet Credit Card Portfolio
have billing addresses in all 50 states, the District of Columbia, Puerto Rico,
Guam, the Virgin Islands and certain foreign countries. As noted above, Eligible
Accounts must, as of the Relevant Cut-Off Date, have a billing address in the
United States, its territories or possessions or a military address and, as
shown in this section in the table captioned "Geographic Distribution of
Accounts and Receivables--Trust Portfolio," as of September 30, 1999, 99.9% of
the Accounts and 99.9% of the Receivables had billing addresses in one of the 50
states or the District of Columbia.
Pursuant to the Pooling and Servicing Agreement, the Seller may be
obligated (subject to certain limitations and conditions) to designate
Additional Accounts to be included as Accounts and to convey to the Trust all
Receivables of such Additional Accounts, or may elect to automatically designate
Additional Accounts and convey the Receivables therein whether such Receivables
are then existing or thereafter created. See "Description of the
Certificates--General" and "--Addition of Accounts" in the accompanying
Prospectus. These accounts must meet the Criteria as of the Relevant Cut-Off
Date. Throughout the term of the Trust, the Accounts from which the Receivables
arise will be the existing MasterCard and VISA accounts designated by the Seller
on the Relevant Cut-Off Date (plus any Additional Accounts subsequently
designated as described above). In addition, as of the Relevant Cut-Off Date and
on the date any new
S-15
<PAGE> 16
Receivables are created, the Seller will represent and warrant to the Trust that
the Receivables are Eligible Receivables. See "Description of the
Certificates--Representations, Warranties and Covenants" in the accompanying
Prospectus.
The Receivables (including receivables in the Additional Accounts the
receivables of which have been or are expected to be conveyed to the Trust
during the period from September 30, 1999 through the Closing Date), as of
September 30, 1999, totaled $11,149,727,148 in 6,836,752 Accounts. The Accounts
had an average credit limit of $6,767. The percentage of the aggregate total
Receivables balance to the aggregate total credit limit was 24.1%. The average
age of the Accounts was approximately 43.0 months.
The Receivables balance in the Trust as of September 30, 1999 (not
including receivables to be added to the Trust thereafter) totaled
$10,849,207,920. The Receivables balance in the Trust as of October 18, 1999,
totaled $11,063,213,652. As of October 18, 1999, the balance of Receivables in
the Trust which were 30 days or more contractually delinquent was $493,494,518.
The following tables summarize the Trust Portfolio (including receivables
in the Additional Accounts the receivables of which have been or are expected to
be conveyed to the Trust during the period from September 30, 1999 through the
Closing Date) by various criteria as of the close of business on September 30,
1999. Because the future composition of the Trust Portfolio may change over
time, these tables are not necessarily indicative of future results.
COMPOSITION BY ACCOUNT BALANCE
TRUST PORTFOLIO
<TABLE>
<CAPTION>
PERCENTAGE
OF TOTAL PERCENTAGE
NUMBER OF NUMBER OF OF TOTAL
ACCOUNT BALANCE RANGE ACCOUNTS ACCOUNTS RECEIVABLES RECEIVABLES
- --------------------- --------- ---------- --------------- -----------
<S> <C> <C> <C> <C>
Credit balance........................... 141,806 2.1% $ (12,349,476) (0.1)%
$0.00.................................... 2,984,122 43.6 0 0.0
$0.01 to $1,000.00....................... 1,157,075 16.9 401,159,820 3.6
$1,000.01 to $2,500.00................... 739,941 10.8 1,267,716,495 11.4
$2,500.01 to $5,000.00................... 1,009,236 14.8 3,739,083,967 33.5
$5,000.01 to $7,500.00................... 525,098 7.7 3,202,738,753 28.7
Over $7,500.00........................... 279,474 4.1 2,551,377,589 22.9
--------- ----- --------------- -----
Total.................................... 6,836,752 100.0% $11,149,727,148 100.0%
========= ===== =============== =====
</TABLE>
COMPOSITION BY CREDIT LIMIT
TRUST PORTFOLIO
<TABLE>
<CAPTION>
PERCENTAGE
OF TOTAL PERCENTAGE
NUMBER OF NUMBER OF OF TOTAL
CREDIT LIMIT BALANCE ACCOUNTS ACCOUNTS RECEIVABLES RECEIVABLES
- -------------------- --------- ---------- --------------- -----------
<S> <C> <C> <C> <C>
$0.00 to $1,000.00....................... 105,189 1.5% $ 12,691,778 0.1%
$1,000.01 to $2,500.00................... 408,745 6.0 330,585,052 3.0
$2,500.01 to $5,000.00................... 1,835,568 26.8 2,333,260,749 20.9
$5,000.01 to $7,500.00................... 2,116,911 31.0 3,246,841,612 29.1
Over $7,500.00........................... 2,370,339 34.7 5,226,347,957 46.9
--------- ----- --------------- -----
Total.................................... 6,836,752 100.0% $11,149,727,148 100.0%
========= ===== =============== =====
</TABLE>
S-16
<PAGE> 17
COMPOSITION BY PERIOD OF DELINQUENCY
TRUST PORTFOLIO
<TABLE>
<CAPTION>
PERCENTAGE
OF TOTAL PERCENTAGE
PERIOD OF DELINQUENCY NUMBER OF NUMBER OF OF TOTAL
(DAYS CONTRACTUALLY DELINQUENT) ACCOUNTS ACCOUNTS RECEIVABLES RECEIVABLES
- ------------------------------- --------- ---------- --------------- -------------
<S> <C> <C> <C> <C>
Not Delinquent......................... 6,579,418 96.2% $10,107,623,746 90.7%
1 to 29 days........................... 147,291 2.1 548,023,708 4.9
30 to 59 days.......................... 41,021 0.6 166,697,572 1.5
60 to 89 days.......................... 24,217 0.4 109,402,865 1.0
90 to 119 days......................... 17,381 0.3 82,291,739 0.7
120 to 149 days........................ 14,199 0.2 68,896,925 0.6
150 to 179 days........................ 11,591 0.2 57,352,485 0.5
180 or more............................ 1,634 0.0 9,438,108 0.1
--------- ----- --------------- -----
Total.................................. 6,836,752 100.0% $11,149,727,148 100.0%
========= ===== =============== =====
</TABLE>
COMPOSITION BY ACCOUNT AGE
TRUST PORTFOLIO
<TABLE>
<CAPTION>
PERCENTAGE
OF TOTAL PERCENTAGE
NUMBER OF NUMBER OF OF TOTAL
AGE (IN MONTHS) ACCOUNTS ACCOUNTS RECEIVABLES RECEIVABLES
- --------------- --------- ---------- --------------- -----------
<S> <C> <C> <C> <C>
Not more than 6 Months................... 903,448 13.2% $ 2,134,208,275 19.1%
Over 6 to 12 Months...................... 491,678 7.2 858,513,076 7.7
Over 12 to 24 Months..................... 1,822,906 26.7 2,276,390,947 20.4
Over 24 to 36 Months..................... 658,233 9.6 915,440,761 8.2
Over 36 to 48 Months..................... 858,724 12.6 1,398,453,383 12.6
Over 48 to 60 Months..................... 737,801 10.8 1,238,432,129 11.1
Over 60 to 84 Months..................... 622,046 9.1 1,059,364,252 9.5
Over 84 Months........................... 741,916 10.8 1,268,924,325 11.4
--------- ----- --------------- -----
Total.................................... 6,836,752 100.0% $11,149,727,148 100.0%
========= ===== =============== =====
</TABLE>
S-17
<PAGE> 18
GEOGRAPHIC DISTRIBUTION OF ACCOUNTS AND RECEIVABLES
TRUST PORTFOLIO(1)
<TABLE>
<CAPTION>
PERCENTAGE
OF TOTAL PERCENTAGE
NUMBER OF NUMBER OF OF TOTAL
STATE ACCOUNTS ACCOUNTS RECEIVABLES RECEIVABLES
- ----- --------- ----------- --------------- -----------
<S> <C> <C> <C> <C>
Alabama.......................................... 73,982 1.1% $ 128,087,520 1.1%
Alaska........................................... 10,354 0.2 19,475,005 0.2
Arizona.......................................... 101,809 1.5 172,426,530 1.5
Arkansas......................................... 55,277 0.8 101,078,966 0.9
California....................................... 891,879 13.0 1,460,541,732 13.1
Colorado......................................... 109,936 1.6 170,333,258 1.5
Connecticut...................................... 158,900 2.3 266,408,053 2.4
Delaware......................................... 16,878 0.2 27,859,523 0.2
District of Columbia............................. 11,453 0.2 20,099,605 0.2
Florida.......................................... 406,713 5.9 680,187,396 6.1
Georgia.......................................... 136,964 2.0 233,468,468 2.1
Hawaii........................................... 23,163 0.3 42,157,212 0.4
Idaho............................................ 26,472 0.4 41,992,633 0.4
Illinois......................................... 262,256 3.8 401,007,081 3.6
Indiana.......................................... 122,744 1.8 196,843,799 1.8
Iowa............................................. 75,007 1.1 110,025,464 1.0
Kansas........................................... 65,555 1.0 109,468,428 1.0
Kentucky......................................... 75,724 1.1 124,775,440 1.1
Louisiana........................................ 88,595 1.3 143,463,085 1.3
Maine............................................ 25,111 0.4 47,853,674 0.4
Maryland......................................... 135,453 2.0 225,011,664 2.0
Massachusetts.................................... 278,236 4.1 442,732,756 4.0
Michigan......................................... 210,038 3.1 336,533,201 3.0
Minnesota........................................ 134,701 2.0 196,969,035 1.8
Mississippi...................................... 38,300 0.6 64,310,772 0.6
Missouri......................................... 132,145 1.9 212,223,214 1.9
Montana.......................................... 18,041 0.3 26,810,365 0.2
Nebraska......................................... 38,303 0.6 55,243,967 0.5
Nevada........................................... 53,819 0.8 100,892,422 0.9
New Hampshire.................................... 46,313 0.7 80,118,716 0.7
New Jersey....................................... 276,429 4.0 419,599,454 3.8
New Mexico....................................... 31,223 0.5 53,618,398 0.5
New York......................................... 629,465 9.2 1,023,618,684 9.2
North Carolina................................... 136,144 2.0 233,959,191 2.1
North Dakota..................................... 13,051 0.2 20,042,238 0.2
Ohio............................................. 257,040 3.8 419,760,044 3.8
Oklahoma......................................... 74,867 1.1 128,347,972 1.2
Oregon........................................... 75,999 1.1 125,430,472 1.1
Pennsylvania..................................... 295,428 4.3 447,825,640 4.0
Rhode Island..................................... 52,656 0.8 84,765,631 0.8
South Carolina................................... 62,641 0.9 107,369,843 1.0
South Dakota..................................... 13,265 0.2 20,541,029 0.2
Tennessee........................................ 106,028 1.5 182,277,276 1.6
Texas............................................ 452,139 6.6 789,230,181 7.1
Utah............................................. 34,012 0.5 49,906,874 0.4
Vermont.......................................... 14,196 0.2 23,520,540 0.2
Virginia......................................... 173,628 2.5 291,388,721 2.6
Washington....................................... 125,878 1.8 213,634,438 1.9
West Virginia.................................... 30,771 0.4 49,611,623 0.4
Wisconsin........................................ 137,582 2.0 193,148,932 1.7
Wyoming.......................................... 11,034 0.2 17,940,724 0.2
All Others....................................... 9,155 0.1 15,790,259 0.1
--------- ----- --------------- -----
Total............................................ 6,836,752 100.0% $11,149,727,148 100.0%
========= ===== =============== =====
</TABLE>
- ------------
(1) All data as of September 30, 1999 (including Receivables then in the Trust
and Receivables in Additional Accounts to be added thereafter through the
Closing Date).
S-18
<PAGE> 19
MATURITY ASSUMPTIONS
The Pooling and Servicing Agreement provides that the Class A
Certificateholders will not receive payments of principal until the October 15,
2004 Distribution Date (the "CLASS A EXPECTED FINAL DISTRIBUTION DATE"), on
which date it is expected that the full principal amount of the Class A
Certificates will be paid; however, payment may begin prior to such date if a
Pay Out Event occurs that results in the start of the Rapid Amortization Period.
The Pooling and Servicing Agreement also provides that the Class B
Certificateholders will not receive payments of principal until the October 15,
2004 Distribution Date (the "CLASS B EXPECTED FINAL DISTRIBUTION DATE"), on
which date it is expected that the full principal amount of the Class B
Certificates will be paid; however, principal payments may begin prior to such
date if a Pay Out Event occurs that results in the start of the Rapid
Amortization Period. No principal payments will be made to the Class B
Certificateholders unless the Class A Investor Amount is paid in full. Unless
and until a Pay Out Event occurs, on each Distribution Date for the Accumulation
Period, monthly deposits of principal equal to the least of (a) Available
Investor Principal Collections, (b) the sum of (i) the Controlled Accumulation
Amount for such Distribution Date and (ii) any Deficit Controlled Accumulation
Amount for the immediately preceding Distribution Date (such sum, the
"CONTROLLED DEPOSIT AMOUNT") and (c) the Invested Amount will be made into the
Principal Funding Account.
Although it is anticipated that a single principal payment will be made to
Class A Certificateholders in an amount equal to the Class A Investor Amount on
the Class A Expected Final Distribution Date and that a single principal payment
will also be made to Class B Certificateholders in an amount equal to the Class
B Investor Amount on the Class B Expected Final Distribution Date, no assurance
can be given in that regard.
In addition to Pay Out Events which apply to all Series, other Pay Out
Events may occur with respect to Series 1999-C only, either automatically or
after specified notice, upon (a) failure of the Seller to make certain payments
or transfers of funds for the benefit of the Certificateholders within the time
periods stated in the Pooling and Servicing Agreement, (b) material breaches of
certain representations, warranties or covenants of the Seller, (c)(i) if the
Seller Amount is less than the Required Seller Amount on the last day of any
Monthly Period (as determined on the third Business Day preceding the following
Distribution Date (the "DETERMINATION DATE"), the failure of the Seller to
convey Receivables in Additional Accounts to the Trust such that the Seller
Amount is at least equal to the Required Seller Amount by the tenth Business Day
following such Determination Date, or (ii) if the aggregate amount of Principal
Receivables is less than the Required Principal Balance on the last day of any
Monthly Period (as determined on the following Determination Date), the failure
of the Seller to convey Receivables in Additional Accounts to the Trust such
that the aggregate Principal Receivables in the Trust are at least equal to the
Required Principal Balance by the tenth Business Day following such
Determination Date, (d) the average of the Net Portfolio Yield for any three
consecutive Monthly Periods being a rate which is less than the Base Rate
averaged over such period, (e) the occurrence of a Servicer Default having a
material adverse effect on the Certificateholders, or (f) failure to pay in full
(i) the Class A Investor Amount on the Class A Expected Final Distribution Date,
(ii) the Class B Investor Amount on the Class B Expected Final Distribution Date
or (iii) the Collateral Invested Amount on the Collateral Expected Final
Distribution Date.
The term "NET PORTFOLIO YIELD" for any Monthly Period, means the annualized
percentage equivalent of a fraction, the numerator of which is the sum of (a)
the amount of collections of Finance Charge Receivables during such Monthly
Period allocable to the Certificates and to the Collateral Interest, including
any other amounts that are to be treated as collections of Finance Charge
Receivables under the Pooling and Servicing Agreement, after subtracting
therefrom the Investor Default Amount for such Monthly Period, plus (b) the
amount of any Principal Funding Investment Proceeds for such Distribution Date,
plus (c) the amount of funds, if any, to be withdrawn from the Reserve Account
that, pursuant to the Series Supplement, are required to be included in Class A
Available Funds with respect to such Distribution Date, and the denominator of
which is the Investor Amount as of the last day of the prior Monthly Period.
For any Monthly Period, the "BASE RATE" will be equal to the annualized
percentage equivalent of a fraction, the numerator of which is equal to the sum
of (i) the Class A Monthly Interest, (ii) the Class B Monthly Interest, (iii)
the Collateral Minimum Monthly Interest and (iv) the Monthly Servicing Fee, each
S-19
<PAGE> 20
for the related Distribution Date and the denominator of which is the Investor
Amount as of the last day of the preceding Monthly Period.
A Pay Out Event occurs, with respect to Series 1999-C and all other Series,
automatically upon (a) the occurrence of an Insolvency Event relating to the
Seller (including any Additional Seller), (b) the Trust becoming an "investment
company" within the meaning of the Investment Company Act of 1940, as amended,
or (c) the inability of the Seller (including any Additional Seller) to transfer
Receivables to the Trust in accordance with the Pooling and Servicing Agreement.
There can be no assurance that a Pay Out Event will not occur. See "Description
of the Certificates--Pay Out Events" in this Prospectus Supplement.
Upon the occurrence of a Pay Out Event which applies to Series 1999-C or to
all Series, a Rapid Amortization Period will begin. The "RAPID AMORTIZATION
PERIOD" means the period beginning with the occurrence of a Pay Out Event and
ending on the earlier of (i) the payment in full of the Class A Investor Amount,
the Class B Investor Amount and the Collateral Invested Amount and (ii) the
Series 1999-C Termination Date. During the Rapid Amortization Period, first the
Class A Certificateholders and then, following the payment in full of the Class
A Investor Amount, the Class B Certificateholders will be entitled to receive
monthly payments of principal equal to the Available Investor Principal
Collections received by the Trust during the related Monthly Period (plus the
principal amount on deposit in the Principal Funding Account) until the Class A
Investor Amount or Class B Investor Amount, as applicable, is paid in full.
Allocations of Principal Receivables will be based on the Principal Allocation
Percentage. See "Description of the Certificates--Allocation Percentages" in
this Prospectus Supplement.
The following table sets forth the highest and lowest cardholder monthly
payment rates and the average of the cardholder monthly payment rates for the
Fleet Credit Card Portfolio. Information prior to February 20, 1998 is pro forma
as if the Bank had purchased the Advanta Consumer Credit Card Portfolio as of
the beginning of 1996. The rates are calculated as a percentage of the total
opening monthly account balances during the periods shown. Payments shown in the
table include amounts which would be deemed payments of Principal Receivables
and Finance Charge Receivables on the Accounts.
MONTHLY PAYMENT RATES
FLEET CREDIT CARD PORTFOLIO(1)
<TABLE>
<CAPTION>
NINE MONTHS ENDED YEAR ENDED DECEMBER 31,
SEPTEMBER 30, -----------------------------
1999(1) 1998(1) 1997(1) 1996(1)
----------------- ------- ------- -------
<S> <C> <C> <C> <C>
Lowest......................................... 11.20% 10.84% 9.93% 8.56%
Highest........................................ 13.64% 12.36% 12.29% 10.28%
Monthly Average................................ 12.19% 11.57% 11.09% 9.55%
</TABLE>
- ---------------
(1) Payment rate calculations include collections of both the Fleet "A" Credit
Card Portfolio and Fleet "B" Credit Card Portfolio beginning on February 20,
1998. Information prior to February 20, 1998 is shown pro forma as if the
Bank had purchased the Advanta Consumer Credit Card Portfolio as of the
beginning of 1996. Collections related to the credit card portfolio acquired
by FFG as a result of the purchase of NatWest Bank, N.A. are included
beginning in June, 1997.
The amount of collections on Receivables may vary from month to month due
to seasonal variations, general economic conditions, changes in tax law and
payment habits of individual cardholders. There can be no assurance that
collections of Principal Receivables from the Trust Portfolio, and thus the rate
at which Certificateholders could expect to accumulate or receive payments of
principal on their Certificates during the Accumulation Period or the Rapid
Amortization Period, will be similar to the historical experience set forth
above. In addition, the ability of the Certificateholders to be paid the
applicable Class A Investor Amount or the Class B Investor Amount on the Class A
Expected Final Distribution Date and the Class B Expected Final Distribution
Date, respectively, may be dependent upon the availability of Shared Principal
Collections. Since the Trust, as a master trust, may issue additional Series
from time to time, there can be no assurance that the issuance of additional
Series or the terms of any additional Series might not have an impact on the
S-20
<PAGE> 21
timing of payments received by Certificateholders. Further, if a Pay Out Event
occurs, the average life and maturity of the Series 1999-C Certificates could be
significantly reduced.
RECEIVABLE YIELD CONSIDERATIONS
The following table provides yield information for the nine months ended
September 30, 1999 and each of the years ended December 31, 1998, 1997 and 1996.
Information prior to February 20, 1998 is shown pro forma as if the Bank had
purchased the Advanta Consumer Credit Card Portfolio as of the beginning of
1996.
The historical yield figures in the table are calculated on an accrual
basis. Collections on the Receivables will be on a cash basis and may not
reflect the historical yield experience in the table. For example, during
periods of increasing delinquencies accrual yields may exceed cash yields as
amounts collected on credit card receivables lag behind amounts accrued and
billed to cardholders. Conversely, as delinquencies decrease, cash yields may
exceed accrual yields as amounts collected in a current period may include
amounts accrued during prior periods. Yield on both an accrual and a cash basis
will be affected by numerous factors, including the finance charges on the
Receivables, the amount of the annual cardholder fees and other fees and
charges, changes in the delinquency rate on the Receivables, the percentage of
cardholders who pay their balances in full each month and do not incur finance
charges and any restrictions which may be imposed by future legislation or
regulations. There can be no assurance that the revenue from finance charges and
fees for the Receivables will be similar to the historical experience set forth
below. See "Risk Factors" in the accompanying Prospectus.
REVENUE FROM FINANCE CHARGES AND FEES
FLEET CREDIT CARD PORTFOLIO(1)
<TABLE>
<CAPTION>
NINE MONTHS YEAR ENDED DECEMBER 31,
ENDED SEPTEMBER 30, ------------------------------
1999 1998 1997 1996
------------------- ------ ------ ------
<S> <C> <C> <C> <C>
Average Monthly Accrued Fees and
Charges(2)(3)(4)....................... $42.10(6) $36.07(1) $36.99(1) $30.12(1)
Average Account Balance(2)(5)............ 2,670 2,798 2,783 2,778
Yield From Fees and Charges(3)(4)........ 18.92%(6) 15.47%(1) 15.95%(1) 13.01%(1)
</TABLE>
- ---------------
(1) The amounts shown, except for the nine months ended September 30, 1999, do
not include revenue attributed to Interchange.
(2) Average Monthly Accrued Fees and Charges and Average Account Balance include
information from both the Fleet "A" Credit Card Portfolio and Fleet "B"
Credit Card Portfolio beginning on February 20, 1998. Information prior to
February 20, 1998 is shown pro forma as if the Bank had purchased the
Advanta Consumer Credit Card Portfolio as of the beginning of 1996. Fees,
charges and account balances related to the credit card portfolio acquired
by FFG as a result of the purchase of NatWest Bank, N.A. are included
beginning in June, 1997.
(3) Fees and Charges for each of the years ended December 31, 1996, 1997 and
1998 are comprised of finance charges, annual cardholder fees and certain
other service charges. Fees and charges for the nine months ended September
30, 1999 are comprised of finance charges, annual cardholder fees and all
other service charges plus revenue attributed to Interchange.
(4) Average Monthly Accrued Fees and Charges and Yield from Fees and Charges are
presented net of adjustments made pursuant to normal servicing procedures,
including removal of incorrect or disputed finance charges and reversal of
finance charges accrued on charged-off accounts.
(5) Average Account Balance includes purchases, cash advances and billed and
unpaid finance and other charges, and is calculated based on the average of
the opening monthly account balances for accounts with balances during the
periods shown.
(6) Beginning January 1, 1999 revenue from Interchange and fees not previously
included have been included in fees and charges and in calculating the yield
from fees and charges. For the nine months ended September 30, 1999, if fees
and charges had not included revenue attributed to Interchange and the
additional fees, the average monthly accrued fees and charges would have
been $36.36 and the yield from fees and charges would have been 16.34%.
The yields shown in the above table are comprised of three components:
finance charges, annual cardholder fees and other service charges, such as late
charges. In addition, for the nine months ended September 30, 1999 the yield
includes Interchange and fees not previously included. The yield related to
annual cardholder fees (on those accounts that assess such fees) and other
service charges varies with the type
S-21
<PAGE> 22
and volume of activity in and the balance of each account. The Bank currently
assesses annual cardholder fees of $10 to $50 for certain of its credit card
accounts. Most accounts included in the Fleet Credit Card Portfolio and
originated since March 1987 do not carry an annual cardholder fee. See "The
Bank's Credit Card Activities" in the accompanying Prospectus. As account
balances increase, an annual cardholder fee, which remains constant, represents
a smaller percentage of the aggregate account balance.
The increase in yields demonstrated in the above table from 1996 to 1997 is
the result of actions taken by the Bank's predecessor as Seller and Servicer to
improve the revenue produced by its credit card business. Several risk based
repricing initiatives were implemented by Advanta National Bank in 1996 and
1997. During this period, the Bank did not implement risk based repricing
initiatives in the Fleet "B" Credit Card Portfolio. In May 1997, the average
percentage rate on a majority of receivables in the Advanta Consumer Credit Card
Portfolio was increased on average from 200 to 300 basis points. In addition,
late, overlimit and nonsufficient funds fees, cash advance fees, and certain
other fees were either increased or added. Due to scaled down marketing efforts,
there was also a lower percentage of teaser rate credit cards in the Advanta
Consumer Credit Card Portfolio in 1997 as compared to prior years.
The increase in yields demonstrated in the above table from December 31,
1998 to September 30, 1999 is the result of several changes implemented by the
Bank. As of January 1, 1999, the Bank, in calculating fees and charges has
included Interchange and service charges not previously included. Other factors
affecting the increase include the Bank's continued use of risk based repricing.
DESCRIPTION OF THE CERTIFICATES
The Certificates will be issued pursuant to the Master Pooling and
Servicing Agreement filed as an exhibit to the Registration Statement of which
the Prospectus is a part. Pursuant to the Master Pooling and Servicing
Agreement, the Seller and the Trustee may execute further supplements thereto in
order to issue additional Series. See "Description of the Certificates--New
Issuances" in the accompanying Prospectus. The Trustee will provide a copy of
the Master Pooling and Servicing Agreement (without exhibits or schedules),
including any relevant Series Supplement, to Certificateholders without charge
upon written request. The following summary, together with information contained
elsewhere in this Prospectus Supplement and the Prospectus, describes the
material terms of the Certificates contained in the Pooling and Servicing
Agreement. The following summary is qualified in its entirety by reference to
the Pooling and Servicing Agreement.
GENERAL
The Certificates and the Collateral Interest will represent undivided
interests in the Trust Assets, including the right to a floating percentage (in
the case of collections of Principal Receivables during the Revolving Period and
in the case of collections of Finance Charge Receivables and Defaulted
Receivables at all times) or a resettable fixed/floating percentage (in the case
of collections of Principal Receivables during the Accumulation Period or the
Rapid Amortization Period) (each, the "SERIES PERCENTAGE") of cardholder
payments on the Receivables. See "--Allocation Percentages" in this Prospectus
Supplement. For any Monthly Period, the portion of the Principal Receivables and
any amounts on deposit in, credited to or held in the Excess Funding Account
represented by the Certificates and the Collateral Interest will be equal to
$300,000,000, which is the initial invested amount of the Certificates and the
Collateral Interest on the Closing Date (the "INITIAL INVESTED AMOUNT"), minus
the principal amount on deposit in the Principal Funding Account, minus the
amount of principal payments paid to the Certificateholders and the Collateral
Interest Holder and minus any unreimbursed reductions in the Invested Amount.
See "Description of the Certificates--Defaulted Receivables; Rebates and
Fraudulent Charges" in the accompanying Prospectus and "Description of the
Certificates--Allocation of Investor Default Amount" in this Prospectus
Supplement.
Each Certificate represents the right to receive monthly payments of
interest for each Interest Period at the Class A Certificate Rate or Class B
Certificate Rate, as applicable, from collections of Finance Charge Receivables
and certain other amounts and, in certain circumstances, amounts withdrawn from
the Reserve Account (provided that amounts withdrawn from the Reserve Account
are only available to the Class A Certificates) and Reallocated Principal
Collections, and deposits or payments of principal during the
S-22
<PAGE> 23
Accumulation Period or the Rapid Amortization Period funded from Available
Investor Principal Collections (including, during the Accumulation Period,
certain collections of Principal Receivables otherwise allocable to other
Series, to the extent such collections are not needed to make payments to or for
the benefit of such other Series).
The Seller holds the interest in the Principal Receivables and the amounts
on deposit in, credited to or held in the Excess Funding Account, if any (the
"SELLER AMOUNT"), not represented by the Certificates, the Collateral Interest
and the certificates of and uncertificated interests in other Series, if any.
The Seller holds an undivided interest in the Trust (the "SELLERS' INTEREST"),
including the right to a percentage (the "SELLER PERCENTAGE") of all cardholder
payments on the Receivables.
During the Revolving Period, the Invested Amount will remain constant
except in certain limited circumstances. See "Description of the
Certificates--Defaulted Receivables; Rebates and Fraudulent Charges" in the
accompanying Prospectus and "Description of the Certificates--Allocation of
Investor Default Amount" in this Prospectus Supplement. The amount of Principal
Receivables, however, will vary each day as new Principal Receivables are
created and others are paid. The Seller Amount will fluctuate daily, therefore,
to reflect the changes in the amount of the Principal Receivables. During the
Accumulation Period or the Rapid Amortization Period, the Invested Amount will
decline for each Monthly Period as cardholder payments of Principal Receivables
are collected and deposited in the Principal Funding Account or paid to the
Certificateholders or the Collateral Interest Holder.
The interest of the Certificateholders in the Trust will terminate
following the earliest of (i) the day after the Distribution Date on which the
Investor Amount is paid in full, (ii) the April 2007 Distribution Date and (iii)
the termination of the Trust (the earliest of (i), (ii) and (iii) being the
"SERIES 1999-C TERMINATION DATE"). All principal and interest will be due and
payable no later than the Series 1999-C Termination Date. See "Description of
the Certificates--Final Payment of Principal and Interest; Termination" in the
accompanying Prospectus.
REGISTRATION OF CERTIFICATES
The Certificates initially will be represented by certificates registered
in the name of Cede & Co., as the nominee of The Depository Trust Company
("DTC"). No person acquiring a beneficial interest in the Certificates (a
"CERTIFICATE OWNER") will be entitled to receive a definitive certificate
representing such person's interest (a "DEFINITIVE CERTIFICATE"), except in the
event that Definitive Certificates are issued under the limited circumstances
described in the Prospectus. Investor Certificateholders may elect to hold their
Investor Certificates through DTC (in the United States) or Cedelbank or
Euroclear (in Europe). See "Description of the Certificates--Definitive
Certificates" in the accompanying Prospectus.
INTEREST PAYMENTS
Interest will accrue on the Certificates at the applicable Class A
Certificate Rate or Class B Certificate Rate from the date of the initial
issuance of the Certificates. Interest payments on the Certificates will be made
on December 15, 1999 and on the 15th day of each month thereafter, or if any
such day is not a Business Day, on the next succeeding Business Day (each a
"DISTRIBUTION DATE"). Interest payments on the Certificates on any Distribution
Date will be calculated on the outstanding principal amount of the Class A
Certificates or the Class B Certificates, as applicable, as of the preceding
Record Date (or, in the case of the first Distribution Date, as of the Closing
Date). Class A Monthly Interest and Class B Monthly Interest due but not paid on
any Distribution Date will be payable on the next succeeding Distribution Date
together with additional interest on such amount at the Class A Certificate Rate
or Class B Certificate Rate, as applicable, plus 2%.
Interest on the Class A Certificates and the Class B Certificates will be
calculated on the basis of a 360-day year of twelve months having 30 days in
each month; provided, however that interest on the Class A Certificates for the
December 15, 1999 Distribution Date will be $2,034,638 and interest on the Class
B Certificates for the December 15, 1999 Distribution Date with be $170,100. The
Class A Certificates will bear
S-23
<PAGE> 24
interest at the rate of 6.90% per annum (the "CLASS A CERTIFICATE RATE"). The
Class B Certificates will bear interest at the rate of 7.20% per annum (the
"CLASS B CERTIFICATE RATE").
The "INTEREST PERIOD" for any Distribution Date will be the period from the
previous Distribution Date through the day preceding such Distribution Date,
except that the initial Interest Period will be the period from the Closing Date
through December 14, 1999, the day preceding the initial Distribution Date. The
term "BUSINESS DAY" means any day other than a Saturday, Sunday or day on which
banking institutions in New York, New York, Providence, Rhode Island or any
other state where the principal executive offices of the Bank or any Additional
Seller or the Trustee are located, are authorized or obligated by law, executive
order or governmental decree to be closed. The "MONTHLY PERIOD" for any
Distribution Date will be the immediately preceding calendar month, except for
the initial Monthly Period, which will begin on the Closing Date and end on
November 30, 1999. The "RECORD DATE" for any Distribution Date will be the last
Business Day of the month preceding such Distribution Date.
On each Distribution Date, Class A Monthly Interest and Class A Monthly
Interest previously due but not distributed to the Class A Certificateholders
will be paid to the Class A Certificateholders from Class A Available Funds for
the related Monthly Period. To the extent Class A Available Funds for such
Monthly Period are insufficient to pay such interest, Excess Spread, and, if
necessary, amounts designated by another Series for allocation to Series within
Group One and which, pursuant to the Master Pooling and Servicing Agreement and
any related supplement, are allocable to Series 1999-C ("EXCESS FINANCE
CHARGES") and Reallocated Principal Collections allocable first to the
Collateral Invested Amount and then to the Class B Invested Amount will be used
to make such payments.
On each Distribution Date, Class B Monthly Interest and Class B Monthly
Interest previously due but not distributed to the Class B Certificateholders
will be paid to the Class B Certificateholders from Class B Available Funds for
the related Monthly Period. To the extent Class B Available Funds for such
Monthly Period are insufficient to pay such interest, Excess Spread and Excess
Finance Charges allocated to Series 1999-C and, if necessary, Reallocated
Principal Collections allocable to the Collateral Invested Amount (in each case
to the extent not used to make distributions for the Class A Certificates) will
be used to make such payment.
"CLASS A AVAILABLE FUNDS" means, for any Monthly Period, an amount equal to
the sum of (a) the Class A Floating Percentage of collections of Finance Charge
Receivables allocated to the Series 1999-C Certificates for such Monthly Period
(including certain other amounts that are to be treated as collections of
Finance Charge Receivables in accordance with the Pooling and Servicing
Agreement), (b) the amount of Principal Funding Investment Proceeds, if any, for
such Distribution Date and (c) the amount of funds, if any, to be withdrawn from
the Reserve Account that, pursuant to the Series Supplement, are required to be
included in Class A Available Funds for such Distribution Date.
"CLASS B AVAILABLE FUNDS" means, for any Monthly Period, an amount equal to
the Class B Floating Percentage of collections of Finance Charge Receivables
allocated to the Series 1999-C Certificates for such Monthly Period (including
certain other amounts that are to be treated as collections of Finance Charge
Receivables in accordance with the Pooling and Servicing Agreement).
"CLASS A MONTHLY INTEREST" means, for any Distribution Date, an amount
equal to one-twelfth of the product of (i) the Class A Certificate Rate and (ii)
the outstanding principal amount of the Class A Certificates as of the preceding
Record Date; provided, however, for the first Distribution Date, Class A Monthly
Interest will be equal to $2,034,638.
"CLASS B MONTHLY INTEREST" means, for any Distribution Date, an amount
equal to one-twelfth of the product of (i) the Class B Certificate Rate and (ii)
the outstanding principal amount of the Class B Certificates as of the preceding
Record Date; provided, however, for the first Distribution Date, Class B Monthly
Interest will be equal to $170,100.
"COLLATERAL AVAILABLE FUNDS" means, for any Monthly Period, an amount equal
to the Collateral Floating Percentage of the collections of Finance Charge
Receivables allocated to Series 1999-C (including any
S-24
<PAGE> 25
amounts that are to be treated as collections of Finance Charge Receivables in
accordance with the Pooling and Servicing Agreement).
"COLLATERAL MINIMUM MONTHLY INTEREST" means, with respect to any
Distribution Date an amount equal to the product of (a) the Collateral Minimum
Interest Rate, (b) the actual number of days in the related Interest Period
divided by 360 and (c) the outstanding principal amount of the Collateral
Interest.
"COLLATERAL MINIMUM INTEREST RATE" means, the London interbank offered rate
for one-month United States dollar deposits plus 2% per annum, or such less
amount as may be designated in the agreement between the Bank and the Collateral
Interest Holder relating to the transfer of the Collateral Interest to the
Collateral Interest Holder.
The London interbank offered rate for one-month United States dollar
deposits with respect to the Collateral Minimum Monthly Interest for each
Interest Period will be determined on the second London business day prior to
the Distribution Date on which such Interest Period commences (or, in the case
of the first Interest Period, on November 1, 1999 for the period from and
including the Closing Date through December 14, 1999).
PRINCIPAL PAYMENTS
During the period (the "REVOLVING PERIOD") that begins on the Closing Date
and ends on the day before the earlier of (i) the start of the Accumulation
Period, or (ii) the start of the Rapid Amortization Period, no principal
payments will be made to or for the benefit of the Certificateholders or
deposited into an account to be accumulated and subsequently used to pay the
Certificateholders. On each Distribution Date for the Revolving Period,
collections of Principal Receivables allocable to the undivided interest in the
assets of the Trust represented by the Certificates and the Collateral Interest
will, subject to certain limitations, including the allocation of any
Reallocated Principal Collections for the related Monthly Period to pay the
Class A Required Amount or the Class B Required Amount, be treated as Shared
Principal Collections. See "Description of the Certificates--Shared Principal
Collections" in the accompanying Prospectus.
The accumulation period for the Series 1999-C Interests (the "ACCUMULATION
PERIOD") is scheduled to begin at the close of business on December 31, 2003.
Subject to the conditions described in this Prospectus Supplement under
"--Postponement of Accumulation Period," the beginning of the Accumulation
Period may be delayed to no later than the close of business on August 31, 2004.
The first principal payment will be made to the Class A Certificateholders on
the earlier of the (i) October 2004 Distribution Date ("CLASS A EXPECTED FINAL
DISTRIBUTION DATE") or (ii) the Distribution Date in the month following the
month in which the Rapid Amortization Period begins. Principal is also expected
to be paid to the Class B Certificateholders on the October 2004 Distribution
Date (the "CLASS B EXPECTED FINAL DISTRIBUTION DATE"); however, if the amount on
deposit in the Principal Funding Account is not sufficient to pay the
Certificates in full, it will be applied first to pay the Class A Certificates.
No principal will be payable to the Class B Certificateholders unless the Class
A Investor Amount is paid in full or funds are available with which to make such
payment in full.
On each Distribution Date for the Accumulation Period prior to the date on
which the Class A Investor Amount and the Class B Investor Amount are paid in
full, an amount equal to the least of (a) Available Investor Principal
Collections on deposit in the Collection Account for such Distribution Date, (b)
the applicable Controlled Deposit Amount for such Distribution Date and (c) the
sum of the Class A Invested Amount and the Class B Invested Amount, will be
deposited in the Principal Funding Account for payment to the Class A
Certificateholders and the Class B Certificateholders. Amounts deposited into
the Principal Funding Account during the Accumulation Period to pay principal of
the Certificates will be paid first to the Class A Certificateholders and then
Class B Certificateholders, on the Class A Expected Final Distribution Date and
the Class B Expected Final Distribution Date or, if earlier, the first
Distribution Date in the Rapid Amortization Period.
"AVAILABLE INVESTOR PRINCIPAL COLLECTIONS" means, for any Monthly Period,
an amount equal to the sum of (a)(i) an amount equal to the Principal Allocation
Percentage of all collections of Principal Receivables
S-25
<PAGE> 26
received during such Monthly Period, minus (ii) the amount of Reallocated
Principal Collections for such Monthly Period used to fund the Class A Required
Amount or the Class B Required Amount plus (b) any Shared Principal Collections
from other Series in Group One that are allocated to Series 1999-C, plus (c) any
other amounts which pursuant to the Series Supplement are to be treated as
Available Investor Principal Collections for the related Distribution Date.
On each Distribution Date for the Rapid Amortization Period until the Class
A Investor Amount has been paid in full or the Series 1999-C Termination Date
occurs, the Class A Certificateholders will be entitled to receive Available
Investor Principal Collections in an amount up to the Class A Investor Amount.
After payment in full of the Class A Investor Amount, the Class B
Certificateholders will be entitled to receive, on each such Distribution Date,
Available Investor Principal Collections until the earlier of the date the Class
B Investor Amount is paid in full and the Series 1999-C Termination Date.
"CLASS A MONTHLY PRINCIPAL" for any Distribution Date for the Accumulation
Period or the Rapid Amortization Period will equal the least of (i) the
Available Investor Principal Collections on deposit in the Collection Account
for that Distribution Date, (ii) for each Distribution Date for the Accumulation
Period (and on or prior to the Class A Expected Final Distribution Date), the
Controlled Deposit Amount for such Distribution Date and (iii) the Class A
Invested Amount on such Distribution Date.
"CLASS B MONTHLY PRINCIPAL" for any Distribution Date, beginning with the
first Distribution Date with respect to the Accumulation Period on which the
full amount of the Class A Investor Amount is on deposit in the Principal
Funding Account or has been paid to the Class A Certificateholders or, if
earlier, the first Distribution Date in the Rapid Amortization Period, will
equal the least of (i) the Available Investor Principal Collections on deposit
in the Collection Account for that Distribution Date (minus the portion of such
Available Investor Principal Collections applied to Class A Monthly Principal on
such Distribution Date), (ii) for each Distribution Date with respect to the
Accumulation Period, the Controlled Deposit Amount for such Distribution Date
(minus the portion of such Controlled Deposit Amount for such Distribution Date
applied to Class A Monthly Principal on such Distribution Date) and (iii) the
Class B Invested Amount on such Distribution Date.
"COLLATERAL MONTHLY PRINCIPAL" means beginning with the later of the
Collateral Expected Final Distribution Date and the Distribution Date on which
the Class B Investor Amount is paid in full, or, if earlier, the first
Distribution Date in the Rapid Amortization Period, an amount equal to the
lesser of (x) Available Investor Principal Collections for that Distribution
Date (minus the portion of such Available Investor Principal Collections applied
to Class A Monthly Principal and Class B Monthly Principal on such Distribution
Date) and (y) the Collateral Invested Amount with respect to such Distribution
Date.
"CONTROLLED ACCUMULATION AMOUNT" means (a) for any Distribution Date for
the Accumulation Period, the sum of the Class A Initial Invested Amount and the
Class B Initial Invested Amount divided by nine (subject to adjustment in
connection with the postponement of the Accumulation Period).
"DEFICIT CONTROLLED ACCUMULATION AMOUNT" means (a) on the first
Distribution Date for the Accumulation Period the excess, if any, of the
Controlled Accumulation Amount for such Distribution Date over the amount
distributed from the Collection Account as Class A Monthly Principal and Class B
Monthly Principal for such Distribution Date and (b) on each subsequent
Distribution Date for the Accumulation Period the excess, if any, of the
Controlled Deposit Amount for such subsequent Distribution Date over the amount
distributed from the Collection Account as Class A Monthly Principal and Class B
Monthly Principal for such subsequent Distribution Date.
"CONTROLLED DEPOSIT AMOUNT" means, for any Distribution Date relating to
the Accumulation Period, an amount equal to the sum of (i) the Controlled
Accumulation Amount on such Distribution Date and (ii) any Deficit Controlled
Accumulation Amount for the immediately preceding Distribution Date.
POSTPONEMENT OF ACCUMULATION PERIOD
Upon written notice to the Trustee, the Servicer may elect to postpone the
start of the Accumulation Period and extend the length of the Revolving Period,
subject to certain conditions, including those set forth
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below. The Servicer may make such election only if the Accumulation Period
Length (determined as described below) is less than nine months. On each
Determination Date, until the Accumulation Period begins, the Servicer will
determine the "ACCUMULATION PERIOD LENGTH," which is the number of months
expected to be required to fully fund the Principal Funding Account to pay the
Class A Investor Amount no later than the Class A Expected Final Distribution
Date and the Class B Investor Amount no later than the Class B Expected Final
Distribution Date, based on (a) the monthly collections of Principal Receivables
expected to be distributable to the Certificateholders of all Series, assuming a
principal payment rate no greater than the lowest monthly principal payment rate
on the Receivables for the preceding 12 months and (b) the amount of principal
expected to be distributable to certificateholders of Series which are not
expected to be in their revolving periods during the Accumulation Period. If the
Accumulation Period Length is less than nine months, the Servicer may, at its
option, postpone the start of the Accumulation Period such that the number of
months included in the Accumulation Period will be equal to or exceed the
Accumulation Period Length. The effect of the foregoing calculation is to permit
the reduction of the length of the Accumulation Period based on the investor
interest of certain other Series that are scheduled to be in their revolving
periods during the Accumulation Period and on increases in the principal payment
rate occurring after the Closing Date. The length of the Accumulation Period
will not be less than one month.
SUBORDINATION
The Class B Certificateholders' Interest and the Collateral Interest will
be subordinated to the extent necessary to fund certain payments with respect to
the Class A Certificates. In addition, the Collateral Interest will be
subordinated to the extent necessary to fund certain payments with respect to
the Class B Certificates. Certain principal payments otherwise allocable to the
Class B Certificateholders may be reallocated to the Class A Certificateholders
and the Class B Invested Amount may be reduced. Similarly, certain principal
payments allocable to the Collateral Interest may be reallocated to the Class A
Certificateholders and the Class B Certificateholders and the Collateral
Invested Amount may be reduced. To the extent the Class B Invested Amount is
reduced, the percentage of collections of Finance Charge Receivables allocated
to the Class B Certificateholders in subsequent Monthly Periods will be reduced.
Moreover, to the extent the amount of such reduction in the Class B Invested
Amount is not reimbursed, the amount of principal distributable to the Class B
Certificateholders will be reduced. See "--Allocation Percentages,"
"--Reallocation of Cash Flows," and "--Application of Collections--Excess
Spread; Excess Finance Charges" in this Prospectus Supplement.
ALLOCATION PERCENTAGES
Pursuant to the Pooling and Servicing Agreement, the Servicer will allocate
among the Class A Certificates, the Class B Certificates, the Collateral
Interest, the certificateholders' interest for all other Series issued and
outstanding and the Sellers' Interest, all collections of Finance Charge
Receivables, Principal Receivables and the Defaulted Amount for each Monthly
Period. Each "MONTHLY PERIOD" will be the period from and including the first
day of a calendar month to and including the last day of the calendar month
(other than the initial Monthly Period which will start on the Closing Date and
end on November 30, 1999).
Collections of Finance Charge Receivables and the Defaulted Amount with
respect to any Monthly Period will be allocated to Series 1999-C based on the
Floating Allocation Percentage. The "FLOATING ALLOCATION PERCENTAGE" means, for
any Monthly Period, the percentage equivalent (which percentage shall never
exceed 100%) of a fraction, the numerator of which is the Invested Amount as of
the last day of the preceding Monthly Period (or with respect to the first
Monthly Period, the Initial Invested Amount) and the denominator of which is the
greater of (1) the sum of (x) the total amount of the Principal Receivables in
the Trust as of such day (or with respect to the first Monthly Period, the total
amount of Principal Receivables in the Trust on the Closing Date) and (y) the
principal amount on deposit in the Excess Funding Account as of such day and (2)
the sum of the numerators used to calculate the Series Percentages for Finance
Charge Receivables or Defaulted Receivables, as applicable, for all Series of
certificates then outstanding; provided, however, that such ratio is subject to
adjustment to give effect to designations of Additional Accounts. Such amounts
so allocated will be further allocated among the Class A
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Certificateholders, the Class B Certificateholders and the Collateral Interest
Holder in accordance with the Class A Floating Percentage, the Class B Floating
Percentage and the Collateral Floating Percentage, respectively.
The "CLASS A FLOATING PERCENTAGE" means, for any Monthly Period, the
percentage equivalent (which percentage shall never exceed 100%) of a fraction,
the numerator of which is equal to the Class A Invested Amount as of the close
of business on the last day of the preceding Monthly Period (or with respect to
the first Monthly Period, the Class A Initial Invested Amount) and the
denominator of which is equal to the Invested Amount as of the close of business
on such day (or for the first Monthly Period, the Initial Invested Amount).
The "CLASS B FLOATING PERCENTAGE" means, for any Monthly Period, the
percentage equivalent (which percentage shall never exceed 100%) of a fraction,
the numerator of which is equal to the Class B Invested Amount as of the close
of business on the last day of the preceding Monthly Period (or with respect to
the first Monthly Period, the Class B Initial Invested Amount) and the
denominator of which is equal to the Invested Amount as of the close of business
on such day (or for the first Monthly Period, the Initial Invested Amount).
The "COLLATERAL FLOATING PERCENTAGE" means, for any Monthly Period, the
percentage equivalent (which percentage shall never exceed 100%) of a fraction,
the numerator of which is equal to the Collateral Invested Amount as of the
close of business on the last day of the preceding Monthly Period (or with
respect to the first Monthly Period, the Collateral Initial Invested Amount) and
the denominator of which is equal to the Invested Amount as of the close of
business on such day (or for the first Monthly Period, the Initial Invested
Amount).
Collections of Principal Receivables will be allocated to Series 1999-C
based on the Principal Allocation Percentage. The "PRINCIPAL ALLOCATION
PERCENTAGE" means, for any Monthly Period, the percentage equivalent (which
percentage shall never exceed 100%) of a fraction, the numerator of which is (a)
during the Revolving Period, the Invested Amount as of the last day of the
immediately preceding Monthly Period (or, in the case of the first Monthly
Period, the Closing Date) and (b) during the Accumulation Period or the Rapid
Amortization Period, the Invested Amount as of the last day of the Revolving
Period or if the numerator has been reduced as described below in this paragraph
during an Accumulation Period and a Rapid Amortization Period begins, as of the
last day of the Accumulation Period and the denominator of which is the greater
of (i) the sum of the total amount of Principal Receivables in the Trust as of
the last day of the immediately preceding Monthly Period and the principal
amount on deposit in the Excess Funding Account as of such last day (or, in the
case of the first Monthly Period, the Closing Date) and (ii) the sum of the
numerators used to calculate the Series Percentages applicable to Principal
Receivables for all Series outstanding as of the date as to which such
determination is being made; provided, however, that during the Accumulation
Period, on any date, at the option of the Servicer, the numerator of the
Principal Allocation Percentage may be reduced below the numerator used in the
previous Monthly Period, to an amount not less than the greater of (x) the
Invested Amount as of the last day of the immediately preceding Monthly Period
(less the amount of any distributions of principal deposited in the Principal
Funding Account since the last day of the immediately preceding Monthly Period)
and (y) an amount that if used as the numerator of the Principal Allocation
Percentage for the reminder of the Accumulation Period, based on certain
assumptions set forth in the Series Supplement, would assure that Available
Investor Principal Collections for Series 1999-C would equal at least 125% of
the Controlled Accumulation Amount for each Monthly Period for so long as the
Invested Amount is greater than zero; provided further, however, that such ratio
is subject to adjustment to give effect to designations of Additional Accounts.
Such amounts allocated to Series 1999-C will be further allocated between
the Class A Certificates, the Class B Certificates and the Collateral Interest
based on the Class A Principal Percentage, the Class B Principal Percentage and
the Collateral Interest Percentage.
The "CLASS A PRINCIPAL PERCENTAGE" means, for any Monthly Period, (a)
during the Revolving Period, the percentage equivalent (which shall never exceed
100%) of a fraction, the numerator of which is equal to the Class A Invested
Amount as of the last day of the immediately preceding Monthly Period (or, in
the
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<PAGE> 29
case of the first Monthly Period, the Closing Date), and the denominator of
which is equal to the Invested Amount as of such day (or, in the case of the
first Monthly Period, the Closing Date) and (b) after the Revolving Period, the
percentage equivalent (which shall never exceed 100%) of a fraction, the
numerator of which is the Class A Invested Amount as of the last day of the
Revolving Period, and the denominator of which is the Invested Amount as of such
last day.
The "CLASS B PRINCIPAL PERCENTAGE" means, for any Monthly Period, (i)
during the Revolving Period, the percentage equivalent (which percentage shall
never exceed 100%) of a fraction, the numerator of which is the Class B Invested
Amount as of the last day of the immediately preceding Monthly Period (or, in
the case of the first Monthly Period, the Closing Date) and the denominator of
which is the Invested Amount as of such day (or, in the case of the first
Monthly Period, the Closing Date) and (ii) after the Revolving Period, the
percentage equivalent (which percentage shall never exceed 100%) of a fraction,
the numerator of which is the Class B Invested Amount as of the last day of the
Revolving Period, and the denominator of which is the Invested Amount as of such
last day.
"COLLATERAL PRINCIPAL PERCENTAGE" means, for any Monthly Period (i) during
the Revolving Period, the percentage equivalent (which percentage shall never
exceed 100%) of a fraction, the numerator of which is the Collateral Invested
Amount as of the last day of the immediately preceding Monthly Period and the
denominator of which is the Invested Amount as of such day and (ii) after the
Revolving Period, the percentage equivalent (which percentage shall never exceed
100%) of a fraction, the numerator of which is the Collateral Invested Amount as
of the last day of the Revolving Period, and the denominator of which is the
Invested Amount as of such last day.
As used in this Prospectus Supplement, the following terms have the
meanings indicated:
"CLASS A INVESTED AMOUNT" for any date means an amount equal to (i)
$252,750,000 (the "CLASS A INITIAL INVESTED AMOUNT"), minus (ii) the aggregate
amount of principal payments made to the Class A Certificateholders on or prior
to such date, minus (iii) the excess, if any, of the aggregate amount of Class A
Investor Charge-Offs for all prior Distribution Dates over the aggregate amount
of any reimbursements of Class A Investor Charge-Offs for all Distribution Dates
prior to such date, and minus (iv) the principal amount on deposit in the
Principal Funding Account on such date (the "PRINCIPAL FUNDING ACCOUNT
BALANCE"), but not in excess of the Class A Initial Invested Amount.
"CLASS B INVESTED AMOUNT" for any date means an amount equal to (i)
$20,250,000 (the "CLASS B INITIAL INVESTED AMOUNT"), minus (ii) the aggregate
amount of principal payments made to Class B Certificateholders on or prior to
such date, minus (iii) the excess, if any, of the aggregate amount of Class B
Investor Charge-Offs for all prior Distribution Dates over the aggregate amount
of reimbursement of Class B Investor Charge-Offs for all Distribution Dates
prior to such date, minus (iv) the aggregate amount of Reallocated Principal
Collections for all prior Distribution Dates which have been used to fund the
Class A Required Amount with respect to such Distribution Dates (excluding any
Reallocated Principal Collections that have resulted in a reduction of the
Collateral Invested Amount), minus (v) an amount equal to the amount by which
the Class B Invested Amount has been reduced to fund the Class A Investor
Default Amount on all prior Distribution Dates as described under "--Allocation
of Investor Default Amount," in this Prospectus Supplement, and plus (vi) the
aggregate amount of Excess Spread and Excess Finance Charges allocated to Series
1999-C and applied on all prior Distribution Dates for the purpose of
reimbursing amounts deducted pursuant to the foregoing clauses (iii), (iv) and
(v) and minus (vii) the positive difference, if any, between the Principal
Funding Account Balance and the Class A Investor Amount on such date; provided,
however, that the Class B Invested Amount may not be reduced below zero.
"COLLATERAL INVESTED AMOUNT" for any date means an amount equal to (i)
$27,000,000 (the "COLLATERAL INITIAL INVESTED AMOUNT"), minus (ii) the aggregate
amount of principal payments made with respect to the Collateral Interest prior
to such date, minus (iii) the aggregate amount of Reallocated Principal
Collections allocable to the Collateral Invested Amount for all prior
Distribution Dates which have been used to fund the Class A Required Amount or
the Class B Required Amount, minus, (iv) an amount equal to the aggregate amount
by which the Collateral Invested Amount has been reduced to fund the Class A
Investor Default Amount and the Class B Investor Default Amount on all prior
Distribution Dates as described under
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<PAGE> 30
"--Allocation of Investor Default Amount" in this Prospectus Supplement, minus
(v) an amount equal to the product of the Collateral Floating Percentage and the
Investor Default Amount (the "COLLATERAL DEFAULT AMOUNT") with respect to any
Distribution Date that is not funded out of Excess Spread and Excess Finance
Charges allocated to Series 1999-C and available for such purpose on such
Distribution Date, and plus (iv) the aggregate amount of Excess Spread and
Excess Finance Charges allocated and available to reimburse amounts deducted
pursuant to the foregoing clause (iii), (iv) and (v); provided, however, that
the Collateral Invested Amount may not be reduced below zero.
"INVESTED AMOUNT," for any date means an amount equal to the sum of the
Class A Invested Amount, the Class B Invested Amount and the Collateral Invested
Amount.
"CLASS A INVESTOR AMOUNT" for any date means an amount equal to the sum of
the Class A Invested Amount plus the Principal Funding Account Balance (but not
in excess of the Class A Initial Invested Amount).
"CLASS B INVESTOR AMOUNT" for any date means an amount equal to the sum of
the Class B Invested Amount plus the positive difference, if any, between the
Principal Funding Account Balance and the Class A Investor Amount on such date
(such sum not to exceed the Class B Initial Invested Amount).
"INVESTOR AMOUNT," for any date means an amount equal to the sum of the
Class A Investor Amount, the Class B Investor Amount and the Collateral Invested
Amount.
"SERIES INVESTOR AMOUNT" for any date means an amount equal to the
numerator of the Principal Allocation Percentage on such date.
REALLOCATION OF CASH FLOWS
With respect to each Distribution Date, on each Determination Date, the
Servicer will determine the amount (the "CLASS A REQUIRED AMOUNT"), which will
be equal to the amount, if any, by which (a) the sum of (i) Class A Monthly
Interest for such Distribution Date, (ii) any Class A Monthly Interest
previously due but not paid to the Class A Certificateholders on a prior
Distribution Date, (iii) any Class A Additional Interest and any Class A
Additional Interest previously due but not paid to the Class A
Certificateholders on a prior Distribution Date, (iv) the Class A Servicing Fee
for such Distribution Date and any unpaid Class A Servicing Fee and (v) the
Class A Investor Default Amount, if any, for such Distribution Date exceeds (b)
the Class A Available Funds for such Distribution Date.
If the Class A Required Amount is greater than zero, Excess Spread and
Excess Finance Charges allocated to Series 1999-C and available for such purpose
will be used to fund the Class A Required Amount for such Distribution Date. If
such Excess Spread and Excess Finance Charges are insufficient to fund the Class
A Required Amount, collections of Principal Receivables allocable first to the
Collateral Interest and then to the Class B Certificates for the related Monthly
Period ("REALLOCATED PRINCIPAL COLLECTIONS") will then be used to fund the
remaining Class A Required Amount. If Reallocated Principal Collections with
respect to the related Monthly Period, together with Excess Spread and Excess
Finance Charges allocated to Series 1999-C are insufficient to fund the Class A
Required Amount for such related Monthly Period, then the Collateral Invested
Amount will be reduced by the amount of such excess (but not by more than the
Class A Investor Default Amount for such Distribution Date). In the event that
such reduction would cause the Collateral Invested Amount to be a negative
number, the Collateral Invested Amount will be reduced to zero, and the Class B
Invested Amount will be reduced by the amount by which the Collateral Invested
Amount would have been reduced below zero (but not by more than the excess of
the Class A Investor Default Amount, if any, for such Distribution Date over the
amount of such reduction, if any, of the Collateral Invested Amount with respect
to such Distribution Date). In the event that such reduction would cause the
Class B Invested Amount to be a negative number, the Class B Invested Amount
will be reduced to zero, and the Class A Invested Amount will be reduced by the
amount by which the Class B Invested Amount would have been reduced below zero
(but not by more than the excess, if any, of the Class A Investor Default Amount
for such Distribution Date over the amount of the reductions, if any, of the
Collateral Invested Amount and the Class B Invested Amount with respect to such
Distribution Date as described above). Any
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such reduction in the Class A Invested Amount may have the effect of slowing or
reducing the return of principal and interest to the Class A Certificateholders.
In such case, the Class A Certificateholders will bear directly the credit and
other risks associated with their interest in the Trust. See "--Allocation of
Investor Default Amount" in this Prospectus Supplement.
With respect to each Distribution Date, on each Determination Date, the
Servicer will determine the amount (the "CLASS B REQUIRED AMOUNT"), which will
be equal to the sum of (a) the amount, if any, by which the sum of (i) Class B
Monthly Interest for such Distribution Date, (ii) any Class B Monthly Interest
previously due but not paid to the Class B Certificateholders on a prior
Distribution Date, (iii) any Class B Additional Interest and any Class B
Additional Interest previously due but not paid to Class B Certificateholders on
a prior Distribution Date and (iv) the Class B Servicing Fee for such
Distribution Date and any unpaid Class B Servicing Fee, exceeds the Class B
Available Funds for such Distribution Date and (b) the Class B Investor Default
Amount for such Distribution Date.
If the Class B Required Amount is greater than zero, Excess Spread and
Excess Finance Charges allocated to Series 1999-C not required to pay the Class
A Required Amount or reimburse Class A Investor Charge-Offs will be used to fund
the Class B Required Amount with respect to such Distribution Date. If such
Excess Spread and Excess Finance Charges available to fund the remaining Class B
Required Amount with respect to such Distribution Date are insufficient to pay
the Class B Required Amount, Reallocated Principal Collections allocable to the
Collateral Interest not required to pay the Class A Required Amount will then be
used to fund the remaining Class B Required Amount. If such Reallocated
Principal Collections allocable to the Collateral Interest are insufficient to
fund the remaining Class B Required Amount, then the Collateral Invested Amount
remaining after any adjustments made for the benefit of the Class A
Certificateholders will be reduced by the amount of such insufficiency (but not
by more than the Class B Investor Default Amount for such Distribution Date). In
the event that such a reduction would cause the Collateral Invested Amount to be
a negative number, the Collateral Invested Amount will be reduced to zero, and
the Class B Invested Amount will be reduced by the amount by which the
Collateral Invested Amount would have been reduced below zero (but not by more
than the excess of the Class B Investor Default Amount for such Distribution
Date over the amount of such reduction of the Collateral Invested Amount). Any
such reduction in the Class B Invested Amount may have the effect of slowing or
reducing the return of principal and interest to the Class B Certificateholders.
In such case, the Class B Certificateholders will bear directly the credit and
other risks associated with their interests in the Trust. See "--Allocation of
Investor Default Amount" in this Prospectus Supplement.
Reductions of the Class A Invested Amount or Class B Invested Amount will
thereafter be reimbursed and the Class A Invested Amount or Class B Invested
Amount increased to the extent of Excess Spread and Excess Finance Charges
available for such purposes on each Distribution Date. See "--Application of
Collections--Excess Spread; Excess Finance Charges" in this Prospectus
Supplement. When such reductions of the Class A Invested Amount and Class B
Invested Amount have been fully reimbursed, reductions of the Collateral
Invested Amount will be reimbursed until reimbursed in full in a similar manner.
APPLICATION OF COLLECTIONS
Application of Collections to the Collection Account. Except under the
conditions described in the accompanying Prospectus under "Description of the
Certificates--Application of Collections," the Servicer will apply, or will
instruct the Trustee to apply, on or prior to the close of business on the
second Business Day following the date of processing of any collections, all
collections and other funds to be deposited into the Collection Account that are
allocated to the Certificates and the Collateral Interest as follows:
(1) during the Revolving Period, an amount equal to the Floating
Allocation Percentage of the collections of Finance Charge Receivables
processed on such date will be allocated to the Series 1999-C Holders, and
of that allocation, the following amounts will be deposited and retained in
the Collection Account: the difference between (x) Monthly Interest for the
related Distribution Date (plus, if the Bank is not the Servicer, the
Monthly Servicing Fee for such Monthly Period) and (y) the amounts
previously deposited in the Collection Account for such Monthly Period
pursuant to this clause (1);
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(2) during the Accumulation Period or Rapid Amortization Period, an
amount equal to the Floating Allocation Percentage of the collections of
Finance Charge Receivables processed on such date will be allocated to the
Series 1999-C Holders and deposited and retained in the Collection Account;
(3) during the Revolving Period, an amount equal to the Principal
Allocation Percentage of collections of Principal Receivables processed on
such date will be allocated to the Series 1999-C Holders and first, if any
other Principal Sharing Series in Group One is outstanding and in its
amortization period or accumulation period, retained in the Collection
Account for application, to the extent necessary, to other Series in Group
One on the related Distribution Date, and second paid to the holders of the
Seller Certificates; provided that such amount will be paid to the holders
of the Seller Certificates only if the Seller Amount is greater than the
Required Seller Amount and the aggregate amount of Principal Receivables is
greater than the Required Principal Balance and otherwise will be deposited
in the Excess Funding Account until the Seller Amount is greater than the
Required Seller Amount and the aggregate amount of Principal Receivables is
greater than the Required Principal Balance and the remainder will be paid
to the holders of the Seller Certificates;
(4) during the Accumulation Period, an amount equal to the Principal
Allocation Percentage of collections of Principal Receivables processed on
such date (for any such date, a "PERCENTAGE ALLOCATION") will be allocated
to the Series 1999-C Holders and deposited and retained in the Collection
Account; provided, however, that if the sum of such Percentage Allocations
with respect to the same Monthly Period exceeds the Controlled Deposit
Amount for the related Distribution Date (or the Collateral Invested Amount
on the Collateral Expected Final Distribution Date), then such excess shall
not be treated as a Percentage Allocation and shall be first, if any other
Principal Sharing Series in Group One is outstanding and in its
amortization period or accumulation period, retained in the Collection
Account for application, to the extent necessary, as Shared Principal
Collections to other Series in Group One on the related Distribution Date,
and second paid to the holders of the Seller Certificates only if the
Seller Amount on such Date of Processing is greater than the Required
Seller Amount and the aggregate amount of Principal Receivables is greater
than the Required Principal Balance and otherwise will be deposited in the
Excess Funding Account until the Seller Amount is greater than the Required
Seller Amount and the aggregate amount of Principal Receivables is greater
than the Required Principal Balance and the remainder will be paid to the
holders of the Seller Certificates; and
(5) during the Rapid Amortization Period, an amount equal to the
Principal Allocation Percentage of the collections of Principal Receivables
processed on such date will be allocated to the Series 1999-C Holders and
deposited and retained in the Collection Account; provided, however, that
after the date on which an amount of such collections equal to the Invested
Amount has been deposited into the Collection Account and allocated to the
Series 1999-C Holders, such amount in excess of the Invested Amount will be
first, if any other Principal Sharing Series in Group One is outstanding
and in its amortization period or accumulation period, retained in the
Collection Account for application, to the extent necessary, as Shared
Principal Collections to other Series in Group One on the related
Distribution Date, and second paid to the holders of the Seller
Certificates only if the Seller Amount is greater than the Required Seller
Amount and the aggregate amount of Principal Receivables is greater than
the Required Principal Balance and otherwise will be deposited in the
Excess Funding Account until the Seller Amount is greater than the Required
Seller Amount and the aggregate amount of Principal Receivables is greater
than the Required Principal Balance and the remainder will be paid to the
holders of the Seller Certificates.
Withdrawals from Series Accounts. On or before each Distribution Date, the
Servicer will direct the Trustee to make the following withdrawals from the
following Series Accounts:
(1) on each Distribution Date all Principal Funding Investment Proceeds
then on deposit in the Principal Funding Account will be withdrawn from the
Principal Funding Account and deposited into the Collection Account for
distribution as a portion of Class A Available Funds for such Distribution
Date;
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(2) on each Distribution Date after the Reserve Account Funding Date,
all net investment income accrued since the preceding Distribution Date on
funds on deposit in the Reserve Account will be retained in the Reserve
Account (to the extent that the amount on deposit in the Reserve Account is
less than the Required Reserve Account Amount) and the balance, if any,
will be deposited in the Collection Account for distribution as collections
of Finance Charge Receivables allocable to the Certificateholders and the
Collateral Interest Holder; and
(3) on or before each Distribution Date for the Accumulation Period and
on the first Distribution Date for the Rapid Amortization Period, if
applicable, an amount equal to the lesser of (a) the Available Reserve
Account Amount for such Distribution Date and (b) the excess, if any, of a
portion of the Class A Monthly Interest determined in accordance with the
Series Supplement over the Principal Funding Investment Proceeds for such
Distribution Date (provided, that the amount of such withdrawal will be
reduced to the extent that funds otherwise would be available to be
deposited in the Reserve Account on such Distribution Date) will be
withdrawn from the Reserve Account and deposited in the Collection Account
for distribution as a portion of Class A Available Funds for such
Distribution Date.
Payment of Interest, Fees and Other Items. On each Distribution Date, the
Trustee, acting pursuant to the Servicer's instructions, will apply the Class A
Available Funds, Class B Available Funds and Collateral Available Funds (see
"--Interest Payments" above) in the following priority:
(A) On each Distribution Date, an amount equal to the Class A Available
Funds for such Distribution Date will be withdrawn from the Collection
Account and distributed in the following priority:
(1) an amount equal to Class A Monthly Interest for such Distribution
Date, plus the amount of any Class A Monthly Interest previously due but
not paid to the Class A Certificateholders on a prior Distribution Date,
plus any additional interest with respect to Class A Monthly Interest
that was due but not paid to the Class A Certificateholders on a prior
Distribution Date at a rate equal to the Class A Certificate Rate plus
2% per annum ("CLASS A ADDITIONAL INTEREST"), and any Class A Additional
Interest previously due but not distributed to the Class A
Certificateholders on a prior Distribution Date will be distributed to
the Class A Certificateholders;
(2) an amount equal to the Class A Servicing Fee for such
Distribution Date, plus the amount of any Class A Servicing Fee
previously due but not distributed to the Servicer on a prior
Distribution Date, will be distributed to the Servicer;
(3) an amount equal to the Class A Investor Default Amount for such
Distribution Date will be treated as a portion of Available Investor
Principal Collections for such Distribution Date; and
(4) the balance, if any, shall constitute Excess Spread and shall be
allocated and distributed as described under "--Excess Spread; Excess
Finance Charges" below.
(B) On each Distribution Date, an amount equal to the Class B Available
Funds with respect to such Distribution Date will be withdrawn from the
Collection Account and distributed in the following priority:
(1) an amount equal to Class B Monthly Interest for such Distribution
Date, plus the amount of any Class B Monthly Interest previously due but
not paid to the Class B Certificateholders on a prior Distribution Date,
plus any additional interest with respect to Class B Monthly Interest
that was due but not paid to the Class B Certificateholders on a prior
Distribution Date at a rate equal to the Class B Certificate Rate plus
2% per annum ("CLASS B ADDITIONAL INTEREST"), and any Class B Additional
Interest previously due but not distributed to the Class B
Certificateholders on a prior Distribution Date will be distributed to
the Class B Certificateholders;
(2) an amount equal to the Class B Servicing Fee for such
Distribution Date, plus the amount of any Class B Servicing Fee
previously due but not distributed to the Servicer on a prior
Distribution Date, will be distributed to the Servicer; and
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(3) the balance, if any, shall constitute Excess Spread and shall be
allocated and distributed as described under "--Excess Spread; Excess
Finance Charges" below.
(C) On each Distribution Date, an amount equal to the Collateral
Available Funds with respect to such Distribution Date will be withdrawn
from the Collection Account and distributed in the following priority:
(1) if the Bank or the Trustee is no longer the Servicer, an amount
equal to the Collateral Servicing Fee for such Distribution Date, plus
the amount of any Collateral Servicing Fee previously due but not
distributed to the Servicer on a prior Distribution Date, will be
distributed to the Servicer; and
(2) the balance, if any, shall constitute Excess Spread and shall be
allocated and distributed as described under "--Excess Spread; Excess
Finance Charges" below.
"EXCESS SPREAD" means, with respect to any Distribution Date, an amount
equal to the sum of the amounts described in clause (A)(4) above, clause (B)(3)
above and clause (C)(2) immediately above.
Excess Spread; Excess Finance Charges. On each Distribution Date, the
Trustee, acting pursuant to the Servicer's instructions, will apply Excess
Spread and Excess Finance Charges allocated to Series 1999-C with respect to the
related Monthly Period to make the following distributions in the following
priority:
(1) an amount equal to any deficiency pursuant to clauses (A)(1), (2)
and (3) above under "--Payment of Interest, Fees and Other Items" will be
used to fund such deficiency, provided, that in the event such deficiency
exceeds the amount of Excess Spread and Excess Finance Charges allocated to
Series 1999-C, such Excess Spread and Excess Finance Charges shall be
applied first to pay amounts due on such Distribution Date pursuant to
clause (A)(1) above under "--Payment of Interest, Fees and Other Items,"
second to pay the Class A Servicing Fee pursuant to clause (A)(2) above
under "--Payment of Interest, Fees and Other Items" and third to pay the
Class A Investor Default Amount for such Distribution Date pursuant to
clause (A)(3) above under "--Payment of Interest, Fees and Other Items;"
(2) an amount equal to the aggregate amount of Class A Investor
Charge-Offs which have not been previously reimbursed will be treated as a
portion of Available Investor Principal Collections for such Distribution
Date as described under "--Payments of Principal" below;
(3) an amount equal to any deficiency pursuant to clauses (B)(1) and 2)
above under "--Payment of Interest, Fees and Other Items" will be used to
fund such deficiency, provided, that in the event such deficiency for such
Distribution Date exceeds the remaining amount of Excess Spread and Excess
Finance Charges allocated to Series 1999-C, such Excess Spread and Excess
Finance Charges will be applied first to pay amounts due with respect to
such Distribution Date pursuant to clause (B)(1) above under "--Payment of
Interest, Fees and Other Items," and second to pay the Class B Servicing
Fee pursuant to clause (B)(2) above under "--Payment of Interest, Fees and
Other Items";
(4) an amount equal to the Class B Investor Default Amount for such
Distribution Date will be treated as a portion of Available Investor
Principal Collections for such Distribution Date as described under
"--Payments of Principal" below;
(5) an amount equal to the aggregate amount by which the Class B
Invested Amount has been reduced pursuant to clauses (iii), (iv) and (v) of
the definition of "Class B Invested Amount" under "--Allocation
Percentages" above (but not in excess of the aggregate amount of such
reductions which have not been previously reimbursed) will be treated as a
portion of Available Investor Principal Collections for such Distribution
Date;
(6) an amount equal to Collateral Minimum Monthly Interest for such
Distribution Date, plus the amount of any Collateral Minimum Monthly
Interest previously due but not paid to the Collateral Interest Holder on a
prior Distribution Date, plus any additional interest with respect to
Collateral Minimum Monthly Interest that was due but not paid to the
Collateral Interest Holder on a prior
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Distribution Date at a rate equal to the Collateral Minimum Interest Rate
("COLLATERAL ADDITIONAL INTEREST"), and any Collateral Additional Interest
previously due but not distributed to the Collateral Interest Holder on a
prior Distribution Date will be distributed to the Collateral Interest
Holder;
(7) an amount equal to the Collateral Servicing Fee for such
Distribution Date (or if neither the Bank nor the Trustee is the Servicer,
the amount of any Collateral Servicing Fee due but not paid from Collateral
Available Funds) and the amount of any Collateral Servicing Fee due but not
paid to the Servicer on a prior Distribution Date will be paid to the
Servicer;
(8) an amount equal to the Collateral Default Amount for such
Distribution Date will be treated as a portion of Available Investor
Principal Collections for such Distribution Date;
(9) an amount equal to the aggregate amount by which the Collateral
Invested Amount has been reduced pursuant to clauses (iii), (iv) and (v) of
the definition of "Collateral Invested Amount" under "--Allocation
Percentages" above (but not in excess of the aggregate amount of such
reductions which have not been previously reimbursed) will be treated as a
portion of Available Investor Principal Collections for such Distribution
Date;
(10) an amount up to the excess, if any, of the Required Reserve Account
Amount over the principal amount on deposit in the Reserve Account will be
deposited in the Reserve Account; and
(11) the balance, if any, will be distributed to the Collateral Interest
Holder.
Reallocated Principal Collections. On or before each Distribution Date
after giving effect to the distributions above under "--Excess Spread; Excess
Finance Charges," the Trustee, acting pursuant to the Servicer's instructions,
will apply Reallocated Principal Collections for the related Monthly Period to
make the following distributions in the following priority:
(1) if the amount of Excess Spread and Excess Finance Charges allocated
to Series 1999-C for the related Monthly Period is less than the Class A
Required Amount, Reallocated Principal Collections, up to the amount of
such deficiency, will be withdrawn from the Collection Account and
distributed to fund such deficiency in the order of priority set forth in
clause (1) above under "--Excess Spread; Excess Finance Charges";
(2) if the amount of Excess Spread and Excess Finance Charges allocated
to Series 1999-C for the related Monthly Period and not required to fund
the Class A Required Amount or reimburse Class A Investor Charge-Offs is
less than the Class B Required Amount, Reallocated Principal Collections
allocable to the Collateral Interest not required to fund the Class A
Required Amount, up to the amount of such deficiency, will be withdrawn
from the Collection Account and distributed to fund such deficiency in the
order of priority set forth in clauses (3) and (4) above under "--Excess
Spread; Excess Finance Charges."
Payments of Principal. On each Distribution Date, the Trustee, acting
pursuant to the Servicer's instructions, will distribute Available Investor
Principal Collections (see "--Principal Payments" above) in the following
priority:
(1) on each Distribution Date for the Revolving Period, all the
Available Investor Principal Collections, will be treated as Shared
Principal Collections and applied as described under "Description of the
Certificates--Shared Principal Collections" in the accompanying Prospectus;
(2) on each Distribution Date for the Accumulation Period or the Rapid
Amortization Period, all such Available Investor Principal Collections will
be distributed or deposited in the following priority:
(i) an amount equal to Class A Monthly Principal will, during the
Accumulation Period, be deposited in the Principal Funding Account for
payment to the Class A Certificateholders on each Distribution Date
beginning on the earlier to occur of the Class A Expected Final
Distribution Date or the first Distribution Date for the Rapid
Amortization Period and, will, during the Revolving Period, be paid to
the Class A Certificateholders;
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(ii) after giving effect to the distribution referred to in clause
(i) above, an amount equal to the Class B Monthly Principal will, during
the Accumulation Period, be deposited in the Principal Funding Account
for payment to the Class B Certificateholders on each Distribution Date
beginning on the earlier to occur of the Class B Expected Final Payment
Date (but only if the Class A Investor Amount is paid in full on such
date) and the first Distribution Date for the Rapid Amortization Period
on which the Class A Investor Amount is paid in full and, will during
the Revolving Period, be paid to the Class B Certificateholders;
(iii) after giving effect to the distributions referred to in clauses
(i) and (ii) above, an amount equal to Collateral Monthly Principal will
be paid to the Collateral Interest Holder on each Distribution Date
beginning on the earlier to occur of the Collateral Expected Final
Distribution Date (but only if the Class B Investor Amount is paid in
full on or prior to such date) and the first Distribution Date for the
Rapid Amortization Period on which the Class B Investor Amount is paid
in full; and
(iv) the balance, if any, will be treated as Shared Principal
Collections and applied as described under "Description of the
Certificates--Shared Principal Collections" in the accompanying
Prospectus.
The "COLLATERAL EXPECTED FINAL DISTRIBUTION DATE" is November 15, 2004.
PRINCIPAL FUNDING ACCOUNT
Pursuant to the Series Supplement, the Servicer will establish and maintain
the principal funding account as a segregated trust account held for the benefit
of the Class A Certificateholders and the Class B Certificateholders (the
"PRINCIPAL FUNDING ACCOUNT"). During the Accumulation Period the Trustee at the
direction of the Servicer will transfer Available Investor Principal Collections
to the Principal Funding Account as described under "--Application of
Collections--Payments of Principal" in this Prospectus Supplement.
Funds on deposit in the Principal Funding Account will be invested by the
Trustee at the direction of the Servicer in Eligible Investments. Investment
earnings (net of investment losses and expenses) on funds on deposit in the
Principal Funding Account (the "PRINCIPAL FUNDING INVESTMENT PROCEEDS") will be
included in Class A Available Funds for each Distribution Date.
RESERVE ACCOUNT
Pursuant to the Series Supplement, the Servicer will establish and maintain
the reserve account as a segregated trust account held for the benefit of the
Class A Certificateholders (the "RESERVE ACCOUNT"). The Reserve Account is
established to assist with the subsequent distribution of interest on the Class
A Certificates during the Accumulation Period. With respect to each Distribution
Date from and after the Reserve Account Funding Date, but prior to the
termination of the Reserve Account, the Trustee, acting pursuant to the
Servicer's instructions, will apply Excess Spread and Excess Finance Charges
allocated to Series 1999-C (to the extent described above under "--Application
of Collections--Excess Spread; Excess Finance Charges") to increase the amount
on deposit in the Reserve Account (to the extent such amount is less than the
Required Reserve Account Amount).
The "RESERVE ACCOUNT FUNDING DATE" will be the Distribution Date for the
Monthly Period which begins no later than three months prior to the Monthly
Period in which, as of the related Determination Date, the Accumulation Period
is scheduled to begin.
The "REQUIRED RESERVE ACCOUNT AMOUNT" for any Distribution Date on or after
the Reserve Account Funding Date will be equal to (a) the product of (i) 0.5% of
the Class A Investor Amount as of the preceding Distribution Date (after giving
effect to all changes therein on such date) and (ii) a fraction, the numerator
of which is the number of Monthly Periods scheduled to be included in the
Accumulation Period as of such date, and the denominator of which is nine,
provided, that if such numerator is one, the Required Reserve Account Amount
will be zero, or (b) any other amount designated by the Seller, provided, that
if such
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designation is of a lesser amount, the Seller shall have provided the Servicer
and the Trustee with evidence that the Rating Agency Condition has been
satisfied and the Seller shall have delivered to the Trustee a certificate of an
authorized officer to the effect that, based on the facts known to such officer
at such time, in the reasonable belief of the Seller, such designation will not
cause a Pay Out Event or an event that, after the giving of notice or the lapse
of time, would cause a Pay Out Event to occur.
On each Distribution Date, after giving effect to any deposit to be made
to, and any withdrawal to be made from, the Reserve Account, the Trustee will
withdraw from the Reserve Account an amount equal to the excess, if any, of the
amount on deposit in the Reserve Account over the Required Reserve Account
Amount and will pay such amount to the Collateral Interest Holder.
Provided that the Reserve Account has not terminated as described below,
all amounts on deposit in the Reserve Account with respect to any Distribution
Date (after giving effect to any deposits to, or withdrawals from, the Reserve
Account to be made on such Distribution Date) will be invested by the Trustee at
the direction of the Servicer in Eligible Investments. The interest and other
investment income (net of investment expenses and losses) earned on such
investments will be retained in the Reserve Account (to the extent the amount on
deposit is less than the Required Reserve Account Amount) or deposited in the
Collection Account and treated as collections of Finance Charge Receivables
allocable to Series 1999-C.
On the Determination Date before each Distribution Date for the
Accumulation Period and on the first Distribution Date for the Rapid
Amortization Period, a withdrawal will be made from the Reserve Account, and the
amount of such withdrawal will be deposited in the Collection Account and
included in Class A Available Funds in an amount equal to the lesser of (a) the
Available Reserve Account Amount for such Distribution Date and (b) the excess,
if any, of a portion of the Class A Monthly Interest determined in accordance
with the Pooling and Servicing Agreement over the Principal Funding Investment
Proceeds for such Distribution Date; provided, that the amount of such
withdrawal shall be reduced to the extent that funds otherwise would be
available to be deposited in the Reserve Account on such Distribution Date. On
each Distribution Date, the amount available to be withdrawn from the Reserve
Account (the "AVAILABLE RESERVE ACCOUNT AMOUNT") will be equal to the lesser of
the amount on deposit in the Reserve Account (before giving effect to any
deposit to be made to the Reserve Account on such Distribution Date) and the
Required Reserve Account Amount for such Distribution Date.
The Reserve Account will be terminated following the earliest to occur of
(a) the termination of the Trust pursuant to the Pooling and Servicing
Agreement, (b) the date on which the Class A Investor Amount is paid in full and
(c) if the Accumulation Period has not begun, the occurrence of a Pay Out Event
or, if the Accumulation Period has begun, the earlier of the first Distribution
Date with respect to the Rapid Amortization Period and the Class A Expected
Final Distribution Date. Upon the termination of the Reserve Account, all
amounts on deposit therein (after giving effect to any withdrawal from the
Reserve Account on such date as described above) will be distributed to the
Collateral Interest Holder. Any amounts withdrawn from the Reserve Account and
distributed to the Collateral Interest Holder as described above will not be
available for distribution to the Certificateholders.
PAIRED SERIES
The Series 1999-C Certificates are subject to being paired with one or more
later issued Series (each, a "PAIRED SERIES") on or after the commencement of
the Accumulation Period or the Rapid Amortization Period. A Paired Series may be
pre-funded with an initial deposit to a funding account or may have a variable
principal amount. Any such funding account will be held for the benefit of such
Paired Series and not for the benefit of the holders of the Series 1999-C
Certificates. Upon payment in full of the Series 1999-C Certificates, assuming
that there have been no unreimbursed charge-offs with respect to any related
Paired Series, the aggregate investor amount of such Paired Series will have
been increased by an amount up to an aggregate amount equal to the Investor
Amount. The issuance of a Paired Series will be subject to the conditions
described under "Description of the Certificates--New Issuances" in the
accompanying Prospectus.
There can be no assurance that the terms of any Paired Series might not
have an impact on the calculation of the Series Percentage or the timing or
amount of payments received by a Certificateholder. The
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full extent by which the timing or amount of payments received by a holder of a
Series 1999-C Certificate may be affected will be dependent on a number of
factors and will not be readily determinable by the change that may occur in the
Series Percentage.
SHARED COLLECTIONS OF PRINCIPAL RECEIVABLES
To the extent that collections of Principal Receivables allocated to the
Series 1999-C are not needed to make payments to or for the benefit of the
Certificateholders or the Collateral Interest Holder, such collections may be
applied to cover principal payments due to or for the benefit of other Principal
Sharing Series in Group One. Any such application of collections will not result
in a reduction of the Invested Amount of the Series 1999-C Certificates or the
Collateral Interest.
Similarly, certain collections of Principal Receivables allocated to other
Principal Sharing Series in Group One, to the extent such collections are not
needed to make payments to or for the benefit of the holders of the certificates
and other interests of such other Series ("SHARED PRINCIPAL COLLECTIONS"), will
be applied, if necessary, to cover payments of principal due to holders of the
Series 1999-C Certificates during the Accumulation Period. There can be no
assurance that such Shared Principal Collections will be available to cover
payments of principal or deposits due on any Distribution Date for the
Accumulation Period. If no such Shared Principal Collections were available to
the Certificates, the Class A Investor Amount might not be paid in full by the
Class A Expected Final Distribution Date and the Class B Investor Amount might
not be paid in full by the Class B Expected Final Distribution Date. Such Shared
Principal Collections may also be allocated to other Series either currently
outstanding or to be issued by the Trust in the future. To the extent such
Shared Principal Collections are allocated to other Series, the pro rata share
of such Shared Principal Collections allocated to Series 1999-C will be reduced.
ALLOCATION OF INVESTOR DEFAULT AMOUNT
On each Determination Date, the Servicer will calculate the Investor
Default Amount for the preceding Monthly Period. The term "INVESTOR DEFAULT
AMOUNT" means, for any Distribution Date an amount equal to the product of (i)
the Defaulted Amount for the related Monthly Period and (ii) the Floating
Allocation Percentage for such Monthly Period. A portion of the Investor Default
Amount will be allocated to the Class A Certificateholders (the "CLASS A
INVESTOR DEFAULT AMOUNT") on each Distribution Date in an amount equal to the
product of the Class A Floating Percentage applicable during the related Monthly
Period and the Investor Default Amount for such Monthly Period. A portion of the
Investor Default Amount will be allocated to the Class B Certificateholders (the
"CLASS B INVESTOR DEFAULT AMOUNT") in an amount equal to the product of the
Class B Floating Percentage applicable during the related Monthly Period and the
Investor Default Amount for such Monthly Period. A portion of the Investor
Default Amount will be allocated to the Collateral Interest Holder (the
"COLLATERAL DEFAULT AMOUNT") on each Distribution Date in an amount equal to the
product of the Collateral Floating Percentage applicable during the related
Monthly Period and the Investor Default Amount for such Monthly Period.
An amount equal to the Class A Investor Default Amount for each Monthly
Period will be paid from Class A Available Funds, Excess Spread and Excess
Finance Charges allocated to Series 1999-C and Reallocated Principal Collections
and applied as described above under "--Application of Collections--Payment of
Interest, Fees and Other Items," "--Application of Collections--Excess Spread;
Excess Finance Charges" and "--Reallocation of Cash Flows."
An amount equal to the Class B Investor Default Amount for each Monthly
Period will be paid from Excess Spread and Excess Finance Charges allocated to
Series 1999-C and Reallocated Principal Collections allocable to the Collateral
Invested Amount and applied as described above under "--Application of
Collections--Excess Spread; Excess Finance Charges" and "--Reallocation of Cash
Flows."
An amount equal to the Collateral Default Amount for each Monthly Period
will be paid from Excess Spread and Excess Finance Charges allocated to Series
1999-C as described above under "--Application of Collections--Excess Spread;
Excess Finance Charges."
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On each Distribution Date, if the Class A Required Amount for such
Distribution Date exceeds the sum of Excess Spread and Excess Finance Charges
allocable to Series 1999-C and Reallocated Principal Collections, the Collateral
Invested Amount will be reduced by the amount of such excess, but not by more
than the Class A Investor Default Amount for such Distribution Date. In the
event that such reduction would cause the Collateral Invested Amount to be a
negative number, the Collateral Invested Amount will be reduced to zero, and the
Class B Invested Amount will be reduced by the amount by which the Collateral
Invested Amount would have been reduced below zero, but not by more than the
excess, if any, of the Class A Investor Default Amount for such Distribution
Date over the amount of such reduction, if any, of the Collateral Invested
Amount with respect to such Distribution Date. In the event that such reduction
would cause the Class B Invested Amount to be a negative number, the Class B
Invested Amount will be reduced to zero, and the Class A Invested Amount will be
reduced by the amount by which the Class B Invested Amount would have been
reduced below zero, but not by more than the excess, if any, of the Class A
Investor Default Amount for such Distribution Date over the amount of the
reductions, if any, of the Collateral Invested Amount and the Class B Invested
Amount with respect to such Distribution Date as described above (a "CLASS A
INVESTOR CHARGE-OFF"), which may have the effect of slowing or reducing the
return of principal to the Class A Certificateholders. If the Class A Invested
Amount has been reduced by the amount of any Class A Investor Charge-Offs, it
will thereafter be increased on any Distribution Date (but not by an amount in
excess of the aggregate Class A Investor Charge-Offs) by the amount of Excess
Spread and Excess Finance Charges allocated to Series 1999-C and available for
such purpose as described above under "--Application of Collections--Excess
Spread; Excess Finance Charges."
On each Distribution Date, if the Class B Required Amount for such
Distribution Date exceeds the sum of Excess Spread and Excess Finance Charges
allocable to Series 1999-C and not required to pay the Class A Required Amount
and Reallocated Principal Collections allocable to the Collateral Interest and
not required to pay the Class A Required Amount, then the Collateral Invested
Amount will be reduced by the amount of such excess. In the event that such
reduction would cause the Collateral Invested Amount to be a negative number,
the Collateral Invested Amount will be reduced to zero, and the Class B Invested
Amount will be reduced by the amount by which the Collateral Invested Amount
would have been reduced below zero, but not by more than the excess, if any, of
the Class B Investor Default Amount for such Distribution Date over the amount
of such reduction, if any, of the Collateral Invested Amount with respect to
such Distribution Date (a "CLASS B INVESTOR CHARGE-OFF"), which may have the
effect of slowing or reducing the return of principal to the Class B
Certificateholders. If the Class B Invested Amount has been reduced by the
amount of any Class B Investor Charge-Offs, it will thereafter be increased on
any Distribution Date (but not by an amount in excess of the aggregate Class B
Investor Charge-Offs) by the amount of Excess Spread and Excess Finance Charges
allocated to Series 1999-C and available for such purpose as described above
under "--Application of Collections--Excess Spread; Excess Finance Charges."
OPTIONAL REPURCHASE
On any date occurring on or after the date that the Investor Amount is
reduced to 5% or less of the Initial Invested Amount, the Seller will have the
option (to be exercised in its sole discretion) to repurchase the Certificates.
The purchase price of the Certificates and the Collateral Interest will be equal
to the Invested Amount on such Distribution Date on which such purchase occurs
(if the purchase is on a Distribution Date and, if not, the Invested Amount for
the Distribution Date following such repurchase) plus, in each case, accrued and
unpaid interest on the Certificates plus accrued and unpaid interest on the
Collateral Interest. Following any such repurchase, the Certificateholders will
have no further rights with respect to the Receivables; provided, however, that
such repurchase in no way impacts the Certificateholders' rights under the
federal securities law.
Any such optional repurchase may result in an early repayment of the
Certificateholders' investment without any prepayment penalty and there can be
no assurance that a Certificateholder will be able to invest such early
repayment amount at a similar rate of return.
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PAY OUT EVENTS
The Revolving Period will continue through the close of business on
December 31, 2003 (or such later date resulting from postponement of the
Accumulation Period), unless a Pay Out Event occurs prior to such date. A "PAY
OUT EVENT" for Series 1999-C refers to any of the following events, which are
applicable only to Series 1999-C (although other Series may have similar or
identical pay out events):
(a) failure on the part of the Seller (i) to make any payment or deposit
on the date required under the Pooling and Servicing Agreement on or before
the date occurring five Business Days after the date such payment or
deposit is required to be made; or (ii) duly to observe or perform in any
material respect any other covenants or agreements of the Seller in the
Pooling and Servicing Agreement, which failure has a material adverse
effect on the Series 1999-C Holders (which determination will be made
without reference to whether any funds are available pursuant to any credit
enhancement) and continues unremedied for a period of 60 days after written
notice of such failure shall have been given to the Seller by the Trustee,
or to the Seller and the Trustee by Series 1999-C Holders aggregating not
less than 50% of the outstanding principal balance of the Series 1999-C
Interests;
(b) any representation or warranty made by the Seller in the Pooling and
Servicing Agreement or any information required to be given by the Servicer
on behalf of the Seller to identify the Accounts proves to have been
incorrect in any material respect when made or delivered and continues to
be incorrect in any material respect for a period of 60 days after written
notice of such failure shall have been given to the Seller by the Trustee,
or to the Seller and the Trustee by holders of the Certificates aggregating
not less than 50% of the outstanding principal balance of the Certificates
and as a result the interests of the Certificateholders are materially and
adversely affected (which determination shall be made, for so long as the
Collateral Invested Amount is greater than zero without reference to
whether any funds are available pursuant to any credit enhancement);
provided, however, that a Pay Out Event shall not be deemed to have
occurred with respect to this subparagraph (b) if the Seller has accepted
reassignment of the related Receivable or all such Receivables, if
applicable, during such period (or such longer period as the Trustee may
specify) in accordance with the provisions of the Pooling and Servicing
Agreement;
(c) with respect to the end of any Monthly Period (i) with respect to
which the Seller Amount is less than the Required Seller Amount, the
failure of the Seller to convey Receivables in Additional Accounts to the
Trust on or prior to the tenth Business Day following the related
Determination Date such that the Seller Amount is at least equal to the
Required Seller Amount or (ii) with respect to which the aggregate
Principal Receivables are less than the Required Principal Balance, the
failure of the Seller to convey Receivables in Additional Accounts to the
Trust on or prior to the tenth Business Day following the related
Determination Date such that the aggregate Principal Receivables are at
least equal to the Required Principal Balance;
(d) the Net Portfolio Yield averaged over three consecutive Monthly
Periods is less than the Base Rate averaged over such period;
(e) any Servicer Default occurs which would have a material adverse
effect on the Certificateholders (which determination shall be made, for so
long as the Collateral Invested Amount is greater than zero, without
reference to whether any funds are available pursuant to any credit
enhancement); or
(f) the Class A Investor Amount is not paid in full on the Class A
Expected Final Distribution Date or the Class B Investor Amount is not paid
in full on the Class B Expected Final Distribution Date or the Collateral
Invested Amount shall not be paid in full on the Collateral Expected Final
Distribution Date.
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<PAGE> 41
A Pay Out Event for all Series refers to any of the following events, which
are applicable to Series 1999-C and other Series:
(g) an Insolvency Event relating to any Seller (including any Additional
Seller);
(h) the Trust becomes an "investment company" within the meaning of the
Investment Company Act of 1940, as amended; or
(i) the inability of any Seller (including any Additional Seller) for
any reason to transfer Receivables to the Trust in accordance with the
provisions of the Pooling and Servicing Agreement.
In the case of any event described in subparagraphs (a), (b) or (e), a Pay
Out Event will be deemed to have occurred only if, after any applicable grace
period described in such clauses, the Trustee or Series 1999-C Holders
evidencing undivided interests aggregating more than 50% of the aggregate unpaid
principal amount of the Series 1999-C Interests, by written notice to the Seller
and the Servicer (and to the Trustee if given by the Series 1999-C Holders),
declare that a Pay Out Event has occurred with respect to Series 1999-C and in
the case of any event described in subparagraphs (c), (d), (f), (g), (h), or
(i), a Pay Out Event will be deemed to have occurred without any notice or other
action on the part of the Trustee, or the Series 1999-C Holders immediately upon
the occurrence of such event. Upon the occurrence of a Pay Out Event, the Rapid
Amortization Period will commence. In such event, distributions of principal to
the Certificateholders in the priority provided for above will begin on the
first Distribution Date following the month in which the Pay Out Event occurred.
SERVICING COMPENSATION AND PAYMENT OF EXPENSES
The share of the Servicing Fee allocable to the Series 1999-C Interests for
any Distribution Date (the "MONTHLY SERVICING FEE") will be equal to one-twelfth
of the product of (a) 2.0% (the "SERVICING FEE RATE") and (b) the Invested
Amount as of the last day of the Monthly Period preceding such Distribution Date
(the amount calculated pursuant to this clause (b) is referred to as the
"SERVICING BASE AMOUNT"); provided, however, with respect to the first
Distribution Date, the Monthly Servicing Fee will be $187,500.
The share of the Monthly Servicing Fee allocable to the Class A
Certificateholders for any Distribution Date (the "CLASS A SERVICING FEE") will
be equal to one-twelfth of the product of (a) the Class A Floating Percentage,
(b) the Servicing Fee Rate and (c) the Servicing Base Amount; provided, however,
that for the first Distribution Date, the Class A Servicing Fee will be
$157,969. The share of the Monthly Servicing Fee allocable to the Class B
Certificateholders for any Distribution Date (the "CLASS B SERVICING FEE") will
be equal to one-twelfth of the product of (a) the Class B Floating Percentage,
(b) the Servicing Fee Rate and (c) the Servicing Base Amount; provided, however,
that for the first Distribution Date, the Class B Servicing Fee will be $12,656.
The share of the Servicing Fee allocable to the Collateral Interest Holder for
any Distribution Date (the "COLLATERAL SERVICING FEE") will be equal to
one-twelfth of the product of (a) the Collateral Floating Percentage, (b) the
Servicing Fee Rate and (c) the Servicing Base Amount; provided, however, that
for the first Distribution Date, the Collateral Servicing Fee will be $16,875.
The Class A Servicing Fee, the Class B Servicing Fee and the Collateral
Servicing Fee shall be payable to the Servicer solely to the extent amounts are
available for distribution as described under "--Application of
Collections--Payment of Interest, Fees and Other Items" and "--Excess Spread;
Excess Finance Charges" in this Prospectus Supplement.
FEDERAL INCOME TAX CONSEQUENCES
Based on the application of existing law to the facts as set forth in the
Pooling and Servicing Agreement and other relevant documents, Orrick, Herrington
& Sutcliffe LLP, special counsel to the Bank ("SPECIAL TAX COUNSEL"), is of the
opinion that the Certificates will properly be treated as indebtedness for
federal income tax purposes. See "Federal Income Tax Consequences" in the
accompanying Prospectus.
S-41
<PAGE> 42
ERISA CONSIDERATIONS
GENERAL
Subject to the considerations described below and in the accompanying
Prospectus, the Class A Certificates may be purchased by, on behalf of, or with
"plan assets" of any employee benefit or other plan that is subject to the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or
Section 4975 of the Internal Revenue Code of 1986, as amended (the "CODE")(each,
a "PLAN"). Any Plan fiduciary that proposes to cause a Plan to acquire any of
the Certificates should consult with its counsel with respect to the potential
consequences under ERISA and the Code of the Plan's acquisition and ownership of
such Certificates. See "ERISA Considerations" in the accompanying Prospectus.
Section 406 of ERISA and Section 4975 of the Code prohibit Plans from
engaging in certain transactions involving "plan assets" with persons that are
"parties in interest" under ERISA or "disqualified persons" under the Code
(collectively, "PARTIES IN INTEREST") with respect to the Plan. A violation of
these "prohibited transaction" rules may generate excise tax and other
liabilities under ERISA and Section 4975 of the Code for such persons, unless a
statutory, regulatory or administrative exemption is available. Plans that are
governmental plans (as defined in Section 3(32) of ERISA) and certain church
plans (as defined in Section 3(33) of ERISA) are not subject to ERISA
requirements.
CLASS A CERTIFICATES
The U.S. Department of Labor (the "DOL") has issued an individual
exemption, Prohibited Transaction Exemption 99-39 (Exemption Application No.
D-10643), 64 Fed. Reg. 191 (October 4, 1999), to the Seller (the "EXEMPTION")
relating to (1) the initial purchase, the holding and the subsequent resale by
Plans of senior certificates representing an undivided interest in a credit card
trust with respect to which the Seller is the sponsor; and (2) the servicing,
operation and management of such trust, provided that the general conditions and
certain other conditions set forth in the Exemption are satisfied. The Exemption
will apply to the acquisition, holding and resale of the Class A Certificates
by, on behalf of, or with "plan assets" of a Plan, provided that certain
conditions (certain of which are described below) are met.
Among the conditions which must be satisfied for the Exemption to apply are
the following:
(1) The acquisition of the Class A Certificates by a Plan is on terms
(including the price for such Class A Certificates) that are at least as
favorable to the investing Plan as they would be in an arm's-length
transaction with an unrelated party;
(2) The rights and interests evidenced by the Class A Certificates
acquired by the Plan are not subordinated to the rights and interests
evidenced by other certificates of the Trust;
(3) The Class A Certificates acquired by the Plan have received a rating
at the time of such acquisition in one of the two highest generic rating
categories from a Rating Agency, provided that, notwithstanding such
rating, credit support is provided to the Class A Certificates through a
senior-subordinated structure or other form of third-party credit support
which, at a minimum, represents 5% of the outstanding principal balance of
the Class A Certificates at the time of such acquisition;
(4) The Trustee is not an affiliate of the Underwriters, the Seller, the
Servicer, any obligor whose receivables constitute more than 0.5% of the
fair market value of the aggregate undivided interest in the Trust
allocated to Series 1999-C, or any of their respective affiliates (the
"RESTRICTED GROUP");
(5) The sum of all payments made to and retained by the Underwriters in
connection with the distribution of the Class A Certificates represents not
more than reasonable compensation for underwriting such Class A
Certificates; the consideration received by the Seller as a consequence of
the assignment of Receivables to the Trust, to the extent allocable to the
Class A Certificates, represents not more than the fair market value of
such Receivables; and the sum of all payments made to and retained by the
Servicer, to the extent allocable to the Class A Certificates, represents
not more than reasonable
S-42
<PAGE> 43
compensation for the Servicer's services under the Agreement and
reimbursement of the Servicer's reasonable expenses in connection
therewith;
(6) The Plan investing in the Class A Certificates is an "accredited
investor" as defined in Rule 501(a)(1) of Regulation D of the Securities
and Exchange Commission under the Securities Act of 1933, as amended;
(7) The Trustee is a substantial financial institution or trust company
experienced in trust activities, is familiar with its duties,
responsibilities and liabilities as a fiduciary under ERISA and, as the
legal owner of (or holder of a perfected security interest in) the
Receivables, enforces all the rights created in favor of the
Certificateholders, including Plans;
(8) Prior to the issuance of any new Series, confirmation is received
from the Rating Agencies that such issuance will not result in the
reduction or withdrawal of the then current rating of the Class A
Certificates held by any Plan pursuant to the Exemption;
(9) To protect against fraud, chargebacks or other dilution of the
Receivables, the Pooling and Servicing Agreement and the Rating Agencies
require the Seller to maintain a Sellers' Interest of not less than 2% of
the principal balance of the receivables contained in the Trust;
(10) Each Receivable is an Eligible Receivable, based on criteria of the
Rating Agencies and as specified in the Pooling and Servicing Agreement,
and the Pooling and Servicing Agreement requires that any change in the
terms of the cardholder agreements must be made applicable to the
comparable segment of accounts owned or serviced by the Seller which are
part of the same program or have the same or substantially similar
characteristics;
(11) The Pooling and Servicing Agreement limits the number of newly
originated Accounts to be designated to the Trust, unless the Rating
Agencies otherwise consent in writing, to the following: (a) with respect
to any three-month period commencing in January, April, July and October of
each calendar year, 15% of the number of existing Accounts designated to
the Trust as of the first day of the calendar year during which such
monthly period commenced, and (b) with respect to any calendar year, 20% of
the number of existing Accounts designated to the Trust as of the first day
of such calendar year;
(12) The Pooling and Servicing Agreement requires the Seller to deliver
an opinion of counsel confirming the validity and perfection of the
transfer of Receivables in newly originated Accounts to the Trust for each
interim addition; and
(13) The Pooling and Servicing Agreement requires the Seller and the
Trustee to receive confirmation from each Rating Agency that such Rating
Agency will not reduce or withdraw its then current rating of the Class A
Certificates as a result of (a) an addition of Accounts that is required to
be made because either the Seller Amount is less than the Required Seller
Amount or the Principal Receivables are less than the Required Principal
Balance, and such addition exceeds the limits set forth in paragraph 11
above, or (b) a restricted addition of Accounts made at the discretion of
the Seller as described in the accompanying Prospectus under the caption
"Description of the Certificates--Addition of Accounts--Conditions to
Required and Restricted Additions."
The Trust also must meet the following requirements:
(a) The corpus of the Trust must consist only of Receivables of the type
which have been included in other investment pools;
(b) Certificates evidencing interests in such other investment pools
have been rated in one of the two highest generic rating categories by at
least one of the Rating Agencies for at least one year prior to the Plan's
acquisition of the Class A Certificates; and
(c) Certificates evidencing an interest in such other investment pools
have been purchased by investors other than Plans for at least one year
prior to any Plan's acquisition of the Class A Certificates.
S-43
<PAGE> 44
Moreover, the Exemption provides relief from certain self-dealing/conflict
of interest prohibited transactions that may occur when a Plan fiduciary causes
a Plan to acquire the Class A Certificates if the fiduciary (or its affiliate)
is an obligor on the Receivables held in the Trust, provided that, among other
requirements: (a) in the case of an acquisition in connection with the initial
issuance of the Class A Certificates, at least 50% of each Class of Certificates
in which Plans have invested is acquired by persons independent of the
Restricted Group and at least 50% of the aggregate interest in the Trust is
acquired by persons independent of the Restricted Group; (b) such fiduciary (or
its affiliate) is an obligor with respect to 0.5% or less of the fair market
value of the obligations contained in the Trust; (c) the plan's investment in
the Class A Certificates does not exceed 25% of all of the Class A Certificates
outstanding after the acquisition; and (d) no more than 25% of the asset of the
Plan are invested in securities representing an interest in one or more trusts
containing assets sold or serviced by the same entity.
The Seller believes that the Exemption will apply to the acquisition and
holding of the Class A Certificates by Plans and that all conditions of the
Exemption, other than those within the control of the investors, will be met.
CLASS B CERTIFICATES
The DOL has designated the Exemption an "underwriter exemption." As a
result, an insurance company investing solely assets of its general account may
be able to acquire and hold the Class B Certificates, provided that (i) Class A
Certificates are eligible for relief under the Exemption and (ii) such
acquisition and holding satisfies the conditions applicable under Sections I and
III of PTCE 95-60. Accordingly, the Class B Certificates may not be acquired or
held by, on behalf of, or with "plan assets" of any Plan, other than an
insurance company investing assets of its general account. By its acceptance of
a Class B Certificate, each Class B Certificateholder will be deemed to have
represented and warranted that either (i) it is not and will not be a Plan or
(ii) it is an insurance company, it acquired and will hold the Class B
Certificates solely with assets of its general account, and such acquisition and
holding satisfies the conditions applicable under Sections I and III of PTCE
95-60. See "--Class A Certificates" above and "ERISA Considerations" in the
accompanying Prospectus.
CONSULTATION WITH COUNSEL
In light of the foregoing, fiduciaries or other persons contemplating
purchasing the Certificates on behalf of or with "plan assets" of any Plan
should consult their own counsel regarding whether the Trust assets represented
by the Certificates would be considered "plan assets," the consequences that
would apply if the Trust's assets were considered "plan assets," and the
availability of exemptive relief from the prohibited transaction rules, in the
case of the Class A Certificates, under the Exemption or, in the case of the
Class B Certificates and only with respect to an insurance company general
account investor, the Exemption and Sections I and III of PTCE 95-60.
Finally, Plan fiduciaries and other Plan investors should consider the
fiduciary standards under ERISA or other applicable law in the context of the
Plan's particular circumstances before authorizing an investment of a portion of
the Plan's assets in the Certificates. Accordingly, among other factors, Plan
fiduciaries and other Plan investors should consider whether the investment (i)
satisfies the diversification requirement of ERISA or other applicable law, (ii)
is in accordance with the Plan's governing instruments, and (iii) is prudent in
light of the "Risk Factors" and other factors discussed in the accompanying
Prospectus.
S-44
<PAGE> 45
UNDERWRITING
Subject to the terms and conditions set forth in the underwriting agreement
relating to the Class A Certificates and the Class B Certificates, the
"UNDERWRITING AGREEMENT," the Bank has agreed to sell to the underwriters named
below (the "CLASS A UNDERWRITERS"), and each of the Class A Underwriters has
agreed to purchase from the Bank, the principal amount of Class A Certificates
set forth opposite its name below:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT OF
CLASS A UNDERWRITERS CLASS A CERTIFICATES
- -------------------- --------------------
<S> <C>
Salomon Smith Barney Inc. .................................. $ 63,187,500
Credit Suisse First Boston Corporation ..................... $ 63,187,500
Lehman Brothers Inc. ....................................... $ 63,187,500
Merrill Lynch, Pierce, Fenner & Smith
Incorporated .................................. $ 63,187,500
------------
Total............................................. $252,750,000
============
</TABLE>
The Seller has been advised by the Class A Underwriters that the Class A
Underwriters propose initially to offer the Class A Certificates to the public
at the price set forth on the cover page of this Prospectus Supplement and to
certain dealers at such price less a concession not in excess of 0.180% of the
principal amount of the Class A Certificates. The Class A Underwriters may allow
and such dealers may reallow a concession not in excess of 0.110% of the
principal amount of the Class A Certificates to certain other dealers. After the
initial public offering, the public offering price and such concessions may be
changed.
Subject to the terms and conditions set forth in the Underwriting
Agreement, the Bank has agreed to sell to the underwriters named below (the
"CLASS B UNDERWRITERS" and together with the Class A Underwriters, the
"UNDERWRITERS"), and each of the Class B Underwriters has agreed to purchase
from the Bank, the principal amount of Class B Certificates set forth opposite
its name below:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT OF
CLASS B UNDERWRITERS CLASS B CERTIFICATES
- -------------------- --------------------
<S> <C>
Salomon Smith Barney Inc. .................................. $10,125,000
Lehman Brothers Inc. ....................................... $10,125,000
-----------
Total............................................. $20,250,000
===========
</TABLE>
The Seller has been advised by the Class B Underwriters that the Class B
Underwriters propose initially to offer the Class B Certificates to the public
at the price set forth on the cover page of this Prospectus Supplement and to
certain dealers at such price less a concession not in excess of 0.210% of the
principal amount of the Class B Certificates. The Class B Underwriters may allow
and such dealers may reallow a concession not in excess of 0.130% of the
principal amount of the Class B Certificates to certain other dealers. After the
initial public offering, the public offering price and such concessions may be
changed.
The Underwriters will be compensated as set forth in the following table:
<TABLE>
<CAPTION>
UNDERWRITERS' AMOUNT
DISCOUNTS AND PER $1,000 TOTAL
COMMISSIONS OF PRINCIPAL AMOUNT
------------- ------------ --------
<S> <C> <C> <C>
Class A Certificates............................ 0.300% $3.00 $758,250
Class B Certificates............................ 0.350% $3.50 $ 70,875
--------
$829,125
========
</TABLE>
Additional offering expenses are estimated to be $650,000. The Underwriters
have agreed to reimburse the Seller for certain expenses of the issuance and
distribution of the Certificates.
The Seller has agreed that it will indemnify the Underwriters against
certain liabilities, including liabilities under the Act, or contribute to
payments the Underwriters may be required to make in respect thereof.
S-45
<PAGE> 46
Each Underwriter has represented and agreed that (a) it has complied and
will comply with all applicable provisions of the Financial Services Act of 1986
and the Public Offers of Securities Regulations 1995 (the "REGULATIONS") with
respect to anything done by it in relation to the Certificates in, from or
otherwise involving the United Kingdom; (b) it has only issued or passed on and
will only issue or pass on in the United Kingdom any document received by it in
connection with the issue of the Certificates to a person who is of a kind
described in Article 11(3) of the Financial Services Act of 1986 (Investment
Advertisements) (Exemptions) Order 1996 or is a person to whom such document may
otherwise lawfully be issued or passed on; and (c) if it is an authorized person
under Chapter III of part I of the Financial Services Act 1986, it has only
promoted and will only promote (as that term is defined in Regulation 1.02(2) of
the Financial Services (Promotion of Unregulated Schemes) Regulations 1991) to
any person in the United Kingdom the scheme described in this Prospectus
Supplement and the Prospectus if that person is of a kind described either in
Section 76(2) of the Financial Services Act 1986 or in Regulation 1.04 of the
Financial Services (Promotion of Unregulated Schemes) Regulations 1991; and (d)
it is a person of a kind described in Article 11(3) of the Financial Services
Act 1986 (Investment Advertisements) (Exemptions) Order 1996.
The Underwriters may engage in over-allotment transactions, stabilizing
transactions, syndicate covering transactions and penalty bids with respect to
the Certificates in accordance with Regulation M under the Exchange Act.
Over-allotment transactions involve syndicate sales in excess of the offering
size, which creates a syndicate short position. Stabilizing transactions permit
bids to purchase the Certificates so long as the stabilizing bids do not exceed
a specified maximum. Syndicate covering transactions involve purchases of the
Certificates in the open market after the distribution has been completed in
order to cover syndicate short positions. Penalty bids permit the Underwriters
to reclaim a selling concession from a syndicate member when the Certificates
originally sold by such syndicate member are purchased in a syndicate covering
transaction. Such over-allotment transactions, stabilizing transactions,
syndicate covering transactions and penalty bids may cause the price of the
Certificates to be higher than they would otherwise be in the absence of such
transactions. Neither the Bank nor the Underwriters represents that the
Underwriters will engage in any such transactions or that such transactions,
once commenced, will not be discontinued without notice at any time.
LEGAL MATTERS
Certain legal matters relating to the issuance of the Certificates will be
passed upon for the Seller by Linda Morris, Esq., Vice President, Secretary and
General Counsel, Fleet Bank (RI), National Association, and by Orrick,
Herrington & Sutcliffe LLP, Washington, D.C., special counsel to the Seller. In
addition certain legal matters, including matters related to Rhode Island law,
will be passed upon for the Seller by Edwards & Angell, Boston, Massachusetts.
Certain legal matters relating to the federal tax consequences of such issuance
will be passed upon for the Seller by Orrick, Herrington & Sutcliffe LLP,
Washington, D.C. Certain matters relating to the issuance of the Certificates
will be passed upon for the Underwriters by Mayer, Brown & Platt, Chicago,
Illinois.
S-46
<PAGE> 47
INDEX OF PRINCIPAL TERMS
<TABLE>
<S> <C>
Accumulation Period............... S-25
Accumulation Period Length........ S-27
Act............................... S-11
Additional Accounts............... S-15
Advanta........................... S-15
Available Investor Principal
Collections..................... S-25
Available Reserve Account
Amount.......................... S-37
Bank.............................. S-11
Base Rate......................... S-19
Business Day...................... S-24
Certificate Owner................. S-23
Certificateholders................ S-11
Certificates...................... S-11
Class A Additional Interest....... S-33
Class A Available Funds........... S-24
Class A Certificate Rate.......... S-24
Class A Certificateholders........ S-11
Class A Certificates.............. S-11
Class A Expected Final
Distribution Date............... S-19, S-25
Class A Floating Percentage....... S-28
Class A Initial Invested Amount... S-29
Class A Invested Amount........... S-29
Class A Investor Amount........... S-30
Class A Investor Charge-Off....... S-39
Class A Investor Default Amount... S-38
Class A Monthly Interest.......... S-24
Class A Monthly Principal......... S-26
Class A Principal Percentage...... S-28
Class A Required Amount........... S-30
Class A Servicing Fee............. S-41
Class A Underwriters.............. S-45
Class B Additional Interest....... S-33
Class B Available Funds........... S-24
Class B Certificate Rate.......... S-24
Class B Certificateholders........ S-11
Class B Certificates.............. S-11
Class B Expected Final
Distribution Date............... S-19, S-25
Class B Floating Percentage....... S-28
Class B Initial Invested Amount... S-29
Class B Invested Amount........... S-29
Class B Investor Amount........... S-30
Class B Investor Charge-Off....... S-39
Class B Investor Default Amount... S-38
Class B Monthly Interest.......... S-24
Class B Monthly Principal......... S-26
Class B Principal Percentage...... S-29
Class B Required Amount........... S-31
Class B Servicing Fee............. S-41
Class B Underwriters.............. S-45
Closing Date...................... S-11
Code.............................. S-42
Collateral Additional Interest.... S-35
Collateral Available Funds........ S-24
Collateral Default Amount......... S-30, S-38
Collateral Expected Final
Distribution Date............... S-36
Collateral Floating Percentage.... S-28
Collateral Initial Invested
Amount.......................... S-29
Collateral Interest............... S-11
Collateral Interest Holder........ S-11
Collateral Invested Amount........ S-29
Collateral Minimum Interest
Rate............................ S-25
Collateral Minimum Monthly
Interest........................ S-25
Collateral Monthly Principal...... S-26
Collateral Principal Percentage... S-29
Collateral Servicing Fee.......... S-41
Controlled Accumulation Amount.... S-26
Controlled Deposit Amount......... S-19, S-26
Criteria.......................... S-15
Deficit Controlled Accumulation
Amount.......................... S-26
Definitive Certificate............ S-23
Determination Date................ S-19
Distribution Date................. S-23
DOL............................... S-42
DTC............................... S-23
Eligible Account.................. S-15
ERISA............................. S-42
Excess Finance Charges............ S-24
Excess Spread..................... S-34
Exemption......................... S-42
FBC............................... S-11
FFG............................... S-11
Fleet............................. S-15
Fleet "A" Credit Card Portfolio... S-12
Fleet "B" Credit Card Portfolio... S-12
Fleet Credit Card Portfolio....... S-12
Floating Allocation Percentage.... S-27
Group One......................... S-11
Initial Accounts.................. S-15
Initial Closing Date.............. S-15
Initial Cut-Off Date.............. S-15
</TABLE>
S-47
<PAGE> 48
<TABLE>
<S> <C>
Initial Invested Amount........... S-22
Interest Period................... S-24
Invested Amount................... S-30
Investor Amount................... S-30
Investor Default Amount........... S-38
Master Pooling and Servicing
Agreement....................... S-11
Monthly Period.................... S-24, S-27
Monthly Servicing Fee............. S-41
Net Portfolio Yield............... S-19
Paired Series..................... S-37
Parties in Interest............... S-42
Pay Out Event..................... S-40
Percentage Allocation............. S-32
Plan.............................. S-42
Pooling and Servicing Agreement... S-11
Principal Allocation Percentage... S-28
Principal Funding Account......... S-36
Principal Funding Account
Balance......................... S-29
Principal Funding Investment
Proceeds........................ S-36
Rapid Amortization Period......... S-20
Reallocated Principal
Collections..................... S-30
Record Date....................... S-24
Regulations....................... S-46
Relevant Cut-Off Date............. S-15
Required Reserve Account Amount... S-36
Reserve Account................... S-36
Reserve Account Funding Date...... S-36
Restricted Group.................. S-42
Revolving Period.................. S-25
Seller............................ S-11
Seller Amount..................... S-23
Seller Percentage................. S-23
Sellers' Interest................. S-23
Series 1999-C..................... S-11
Series 1999-C Certificates........ S-11
Series 1999-C Holders............. S-11
Series 1999-C Interests........... S-11
Series 1999-C Termination Date.... S-23
Series Investor Amount............ S-30
Series Percentage................. S-22
Series Supplement................. S-11
Servicer.......................... S-11
Servicing Base Amount............. S-41
Servicing Fee Rate................ S-41
Shared Principal Collections...... S-38
Special Tax Counsel............... S-41
Trust............................. S-11
Trust Portfolio................... S-12
Trustee........................... S-11
Underwriters...................... S-45
Underwriting Agreement............ S-45
</TABLE>
S-48
<PAGE> 49
ANNEX I
OTHER SERIES ISSUED
The Certificates will be the twenty-first Series to be issued by the Trust.
The table below sets forth the principal characteristics of the fourteen other
Series heretofore issued by the Trust and currently outstanding. Such Series are
the Series 1994-B Certificates, the Series 1995-A Certificates, the Series
1995-C Certificates, the Series 1995-D Certificates, the Series 1995-F
Certificates, the Series 1995-G Certificates, the Series 1996-A Certificates,
the Series 1996-B Certificates, the Series 1996-C Certificates, the Series
1996-D Certificates, the Series 1996-E Certificates, the Series 1998-A
Certificates, the Series 1999-A Certificate and the Series 1999-B Certificates.
In addition, the table below sets forth certain of the principal characteristics
of Series 1999-D anticipated to be issued substantially concurrently with this
Series 1999-C. Solely for purposes of this Annex I, "LIBOR" shall mean London
interbank offered quotations for United States dollar deposits determined as set
forth in the related Series Supplements.
<TABLE>
<S> <C>
SERIES 1994-B
Initial Invested Amount......................... $450,000,000
Initial Pre-Funded Amount....................... $300,000,000
Invested Amount as of September 30, 1999........ $262,016,460
Class A Certificate Rate........................ One Month LIBOR plus .28% per annum (capped at
12% per annum)
Class B Certificate Rate........................ One Month LIBOR plus .53% per annum (capped at
12% per annum)
Collateral Rate................................. No higher than One Month LIBOR plus 1.00% per
annum
Initial Enhancement Amount...................... $75,000,000
Series Servicing Fee Rate....................... 2% per annum
Stated Series 1994-B Termination Date........... October 1, 2001
Series Issuance Date............................ July 19, 1994
SERIES 1995-A
Initial Invested Amount......................... $600,000,000
Initial Pre-Funded Amount....................... $100,000,000
Invested Amount as of September 30, 1999........ $700,000,000
Class A Certificate Rate........................ One Month LIBOR plus .180% per annum
Class B Certificate Rate........................ One Month LIBOR plus .375% per annum
Collateral Rate................................. No higher than One Month LIBOR plus 1.00% per
annum
Initial Enhancement Amount...................... $73,500,000
Series Servicing Fee Rate....................... 2% per annum
Stated Series 1995-A Termination Date........... January 1, 2003
Series Issuance Date............................ January 18, 1995
SERIES 1995-C
Initial Invested Amount......................... $375,000,000
Initial Pre-Funded Amount....................... $200,000,000
Investor Amount as of September 30, 1999........ $575,000,000
Class A Certificate Rate........................ Three Month LIBOR plus .20% per annum
Class B Certificate Rate........................ Three Month LIBOR plus .34% per annum
Collateral Rate................................. No higher than One Month LIBOR plus 1.00% per
annum
Initial Enhancement Amount...................... $60,375,000
Series Servicing Fee Rate....................... 2% per annum
Stated Series 1995-C Termination Date........... January 1, 2005
Series Issuance Date............................ April 27, 1995
</TABLE>
I-1
<PAGE> 50
<TABLE>
<S> <C>
SERIES 1995-D
Initial Invested Amount......................... $450,000,000
Initial Pre-Funded Amount....................... $150,000,000
Investor Amount as of September 30, 1999........ $600,000,000
Class A Certificate Rate........................ One Month LIBOR plus .19% per annum
Class B Certificate Rate........................ One Month LIBOR plus .32% per annum
Initial Enhancement Amount...................... $63,000,000
Series Servicing Fee Rate....................... 2% per annum
Stated Series 1995-D Termination Date........... February 1, 2004
Series Issuance Date............................ July 25, 1995
SERIES 1995-F
Initial Invested Amount......................... $750,000,000
Initial Pre-Funded Amount....................... $100,000,000
Investor Amount as of September 30, 1999........ $850,000,000
Class A-1 Certificate Rate...................... 6.05% per annum
Class A-2 Certificate Rate...................... One Month LIBOR plus .19% per annum
Class B Certificate Rate........................ One Month LIBOR plus .30% per annum
Initial Enhancement Amount...................... $65,875,000
Series Servicing Fee Rate....................... 2% per annum
Series 1995-F Termination Date.................. August 1, 2003
Series Issuance Date............................ November 21, 1995
SERIES 1995-G
Initial Invested Amount......................... $500,000,000
Investor Amount as of September 30, 1999........ $500,000,000
Class A Certificate Rate........................ One Month LIBOR plus .14% per annum
Class B Certificate Rate........................ One Month LIBOR plus .29% per annum
Collateral Rate................................. No higher than One Month LIBOR plus 1.00% per
annum
Initial Enhancement Amount...................... $50,000,000
Series Servicing Fee Rate....................... 2% per annum
Series 1995-G Termination Date.................. June 2002 Distribution Date
Series Issuance Date............................ December 15, 1995
SERIES 1996-A
Initial Invested Amount......................... $400,000,000
Initial Pre-Funded Amount....................... $100,000,000
Investor Amount as of September 30, 1999........ $500,000,000
Class A-1 Certificate Rate...................... 6.0% per annum
Class A-2 Certificate Rate...................... One Month LIBOR plus .23% per annum
Class B Certificate Rate........................ One Month LIBOR plus .35% per annum
Collateral Rate................................. No higher than One Month LIBOR plus 1.00% per
annum
Initial Enhancement Amount...................... $43,750,000
Series Servicing Fee Rate....................... 2% per annum
Series 1996-A Termination Date.................. November 2005 Distribution Date
Series Issuance Date............................ January 18, 1996
</TABLE>
I-2
<PAGE> 51
<TABLE>
<S> <C>
SERIES 1996-B
Initial Invested Amount......................... $750,000,000
Investor Amount as of September 30, 1999........ $750,000,000
Class A Certificate Rate........................ Three Month LIBOR plus .230% per annum
Class B Certificate Rate........................ Three Month LIBOR plus .375% per annum
Collateral Rate................................. No higher than One Month LIBOR plus 1.00% per
annum
Initial Enhancement Amount...................... $75,000,000
Series Servicing Fee Rate....................... 2% per annum
Series 1996-B Termination Date.................. January 2007 Distribution Date
Series Issuance Date............................ March 26, 1996
SERIES 1996-C
Initial Invested Amount......................... $700,000,000
Investor Amount as of September 30, 1999........ $700,000,000
Class A Certificate Rate........................ Three Month LIBOR plus .120% per annum
Class B Certificate Rate........................ Three Month LIBOR plus .250% per annum
Collateral Rate................................. No higher than Three Month LIBOR plus 1.00% per
annum
Initial Enhancement Amount...................... $70,000,000
Series Servicing Fee Rate....................... 2% per annum
Series 1996-C Termination Date.................. November 2003 Distribution Date
Series Issuance Date............................ May 13, 1996
SERIES 1996-D
Initial Invested Amount......................... $575,000,000
Initial Pre-Funded Amount....................... $125,000,000
Investor Amount as of September 30, 1999........ $700,000,000
Class A Certificate Rate........................ One Month LIBOR plus .15% per annum
Class B Certificate Rate........................ One Month LIBOR plus .30% per annum
Collateral Rate................................. No higher than One Month LIBOR plus 1.00% per
annum
Initial Enhancement Amount...................... $70,000,000
Series Servicing Fee Rate....................... 2% per annum
Series 1996-D Termination Date.................. June 2005 Distribution Date
Series Issuance Date............................ June 18, 1996
SERIES 1996-E
Initial Invested Amount......................... $450,000,000
Initial Pre-Funded Amount....................... $50,000,000
Investor Amount as of September 30, 1999........ $500,000,000
Class A Certificate Rate........................ One Month LIBOR plus .10% per annum
Class B Certificate Rate........................ One Month LIBOR plus .33% per annum
Collateral Rate................................. No higher than One Month LIBOR plus 1.00% per
annum
Initial Enhancement Amount...................... $50,000,000
Series Servicing Fee rate....................... 2% per annum
Series 1996-E Termination Date.................. May 2004 Distribution Date
Series Issuance Date............................ November 1, 1996
</TABLE>
I-3
<PAGE> 52
<TABLE>
<S> <C>
SERIES 1998-A
Initial Invested Amount......................... $862,500,000
Initial Pre-Funded Amount....................... $287,500,000
Investor Amount as of September 30, 1999........ $1,150,000,000
Class A Certificate Rate........................ One Month LIBOR plus .04% per annum
Class B Certificate Rate........................ One Month LIBOR plus .24% per annum
Collateral Rate................................. No higher than One Month LIBOR plus 1.00% per annum
Initial Enhancement Amount...................... $120,750,000
Series Servicing Fee Rate....................... 2% per annum
Series 1998-A Termination Date.................. July 2003 Distribution Date
Series Issuance Date............................ February 6, 1998
SERIES 1999-A
Initial Invested Amount......................... $600,000,000
Investor Amount as of September 30, 1999........ $600,000,000
Class A Certificate Rate........................ One Month LIBOR plus .11% per annum
Class B Certificate Rate........................ One Month LIBOR plus .33% per annum
Class C Interest................................ No higher than One Month LIBOR plus 2.00% per annum
Initial Enhancement Amount...................... $66,000,000
Series Servicing Fee Rate....................... 2% per annum
Series 1999-A Termination Date.................. September 2004 Distribution Date
Series Issuance Date............................ March 23, 1999
SERIES 1999-B
Initial Invested Amount......................... $500,000,000
Investor Amount as of September 30, 1999........ $500,000,000
Class A Certificate Rate........................ One Month LIBOR plus .20% per annum
Class B Certificate Rate........................ One Month LIBOR plus .39% per annum
Collateral Rate................................. No higher than One Month LIBOR plus 2.00% per annum
Initial Enhancement Amount...................... $55,000,000
Series Servicing Fee Rate....................... 2% per annum
Series 1999-B Termination Date.................. January 2007 Distribution Date
Series Issuance Date............................ July 22, 1999
SERIES 1999-D
Initial Invested Amount......................... $600,000,000
Class A Certificate Rate........................ One Month LIBOR plus 0.22% per annum
Class B Certificate Rate........................ One Month LIBOR plus 0.50% per annum
Collateral Minimum Interest Rate................ Not to exceed 9.5% per annum
Initial Enhancement Amount...................... $66,000,000
Series Servicing Fee Rate....................... 2% per annum
Series 1999-D Termination Date.................. April 2007 Distribution Date
Series Issuance Date............................ November 3, 1999
</TABLE>
I-4
<PAGE> 53
ANNEX II
RECEIVABLES IN ADDITIONAL ACCOUNTS
CONVEYED TO THE TRUST
<TABLE>
<CAPTION>
NUMBER OF RECEIVABLES
ASSIGNMENT DATE RECEIVABLES ADDITIONAL IN ADDITIONAL
NUMBER TRANSFERRED TO TRUST RELEVANT CUT-OFF DATE ACCOUNTS(1) ACCOUNTS(1)
- ---------- -------------------- --------------------- ----------- -------------
<C> <S> <C> <C> <C>
1 May 16, 1994 March 31, 1994 276,371 $367,091,261
2 July 1, 1994 May 31, 1994 157,629 $202,859,562
3 August 17, 1994 July 31, 1994 226,342 $351,961,171
4 September 23, 1994 August 31, 1994 192,815 $299,924,106
5 November 18, 1994 October 31, 1994 332,866 $406,625,727
6 January 6, 1995 November 30, 1994 217,320 $316,458,944
7 March 15, 1995 February 28, 1995 291,057 $348,693,399
8 April 18, 1995 March 31, 1995 143,714 $168,739,171
9 May 23, 1995 April 30, 1995 98,330 $137,485,579
10 July 18, 1995 June 30, 1995 322,271 $432,984,240
11 August 15, 1995 July 31, 1995 126,338 $188,302,827
12 August 31, 1995 August 11, 1995 67,968 $ 94,548,321
13 November 21, 1995 October 25, 1995 285,122 $491,863,655
14 December 15, 1995 November 26, 1995 265,376 $369,389,253
15 January 18, 1996 December 26, 1995 182,985 $330,263,251
16 February 19, 1996 January 31, 1996 269,467 $560,543,656
17 March 26, 1996 February 29, 1996 150,460 $330,531,723
18 May 1, 1996 March 31, 1996 68,056 $251,797,517
19 May 13, 1996 March 31, 1996 219,150 $499,241,938
20 June 18, 1996 April 30, 1996 244,770 $636,632,670
21 June 30, 1996 May 31, 1996 73,771 $200,155,226
22 September 1, 1996 July 31, 1996 217,130 $640,152,919
23 November 1, 1996 September 30, 1996 151,051 $500,113,079
24 November 1, 1996 September 30, 1996 30,631 $100,564,456
25 November 15, 1996 October 31, 1996 100,603 $250,370,356
26 January 17, 1997 December 31, 1996 118,232 $368,278,729
27 February 14, 1997 January 31, 1997 111,777 $307,635,708
28 March 14, 1997 February 28, 1997 169,598 $400,826,266
29 April 18, 1997 March 31, 1997 204,546 $450,500,767
30 May 14, 1997 April 30, 1997 155,299 $450,053,037
31 June 13, 1997 May 31, 1997 148,940 $241,091,790
32 June 29, 1997 May 31, 1997 5,757 $ 10,065,454
33 September 12, 1997 August 31, 1997 250,570 $499,607,860
34 September 30, 1997 August 31, 1997 218,401 $301,830,170
35 November 14, 1997 October 31, 1997 167,351 $322,443,973
36 December 12, 1997 November 30, 1997 228,234 $203,845,007
37 January 30, 1998 December 31, 1997 492,821 $729,961,299
38 February 13, 1998 January 31, 1998 246,990 $363,909,199
39 April 14, 1998 March 31, 1998 227,285 $907,447,235
40 May 14, 1998 April 30, 1998 249,490 $602,772,032
41 July 1, 1998 May 31, 1998 284,855 $582,539,789
42 September 1, 1998 July 31, 1998 209,559 $500,442,550
</TABLE>
II-1
<PAGE> 54
<TABLE>
<CAPTION>
NUMBER OF RECEIVABLES
ASSIGNMENT DATE RECEIVABLES ADDITIONAL IN ADDITIONAL
NUMBER TRANSFERRED TO TRUST RELEVANT CUT-OFF DATE ACCOUNTS(1) ACCOUNTS(1)
- ---------- -------------------- --------------------- ----------- -------------
<C> <S> <C> <C> <C>
43 October 1, 1998 August 31, 1998 126,098 $364,789,653
44 November 13, 1998 October 31, 1998 276,577 $648,197,959
45 December 14, 1998 November 30, 1998 65,326 $166,800,025
46 December 31, 1998 November 30, 1998 79,855 $210,815,757
47 January 28, 1999 December 31, 1998 77,427 $197,913,305
48 January 31, 1999 December 31, 1998 312,662 $704,718,352
49 February 16, 1999 January 31, 1999 189,409 $393,818,299
50 March 10, 1999 January 31, 1999 145,162 $248,815,264
51 March 24, 1999 February 28, 1999 152,894 $206,886,377
52 April 14, 1999 March 31, 1999 56,776 $105,666,192
53 April 16, 1999 March 31, 1999 124,643 $304,064,904
54 May 14, 1999 April 30, 1999 95,437 $123,248,542
55 June 1, 1999 April 30, 1999 400,682 $925,598,651
56 July 19, 1999 May 31, 1999 89,208 $118,401,838
57 July 23, 1999 June 30, 1999 182,395 $332,801,715
58 September 21, 1999 August 31, 1999 399,265 $920,892,601
59 October 15, 1999 September 30, 1999 147,493 $300,519,356
</TABLE>
- ------------
(1) The amounts shown are as of the Relevant Cut-Off Date.
II-2
