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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) August 2, 1999
AMERICAN EXPRESS AMERICAN EXPRESS RECEIVABLES
CENTURION BANK FINANCING CORPORATION II
(as Originators of the American Express Credit Account Master Trust)
--------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
on behalf of
American Express Credit Account Master Trust
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<S> <C> <C> <C> <C> <C>
Utah 11-2869526 333-67567 Delaware 13-3854638 333-67567
(State or Other (I.R.S. Employer (Commission (State or Other (I.R.S. Employer (Commission
Jurisdiction of Identification File Number) Jurisdiction of Identification File Number
Incorporation or Number) Incorporation or Number
Organization Organization)
</TABLE>
6985 UnionPark Center World Financial Center
Midvale, Utah 84047 200 Vesey Street
(801) 565-5000 New York, New York 10285
(212) 640-2000
(Address, Including Zip Code, and Telephone Number,
Including Area Code, of each Registrant's Principal Executive Offices)
N/A N/A
(Former Name or Former Address, (Former Name or Former Address,
if Changed Since Last Report) if Changed Since Last Report)
<PAGE>
INFORMATION TO BE INCLUDED IN THE REPORT
Item 1. Not Applicable.
Item 2. Not Applicable.
Item 3. Not Applicable.
Item 4. Not Applicable.
Item 5. On August 2, 1999, the Registrant made available to
prospective investors a series term sheet setting forth a
description of the collateral pool and the proposed structure
of $412,500,000 aggregate principal amount of Class A Floating
Rate Asset Backed Certificates, Series 1999-4 and $40,000,000
aggregate principal amount of Class B Floating Rate Asset
Backed Certificates, Series 1999-4, each of the American
Express Credit Account Master Trust. The series term sheet
is attached hereto as Exhibit 99.01.
Item 6. Not Applicable.
Item 7. Exhibits.
The following is filed as an Exhibit to this Report under Exhibit 99.01.
Exhibit 99.01 Series Term Sheet, dated August 2, 1999, with
respect to the proposed issuance of the Class A
Floating Rate Asset Backed Certificates and the Class
B Floating Rate Asset Backed Certificates of the
American Express Credit Account Master Trust, Series
1999-4.
Item 8. Not Applicable.
Item 9. Not Applicable.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, as amended, the registrant has duly caused this report to
be signed on their behalf by the undersigned hereunto duly authorized.
American Express Centurion Bank,
on behalf of the American Express
Credit Account Master Trust
By: /s/Maureen Ryan
-------------------------------------
Name: Maureen Ryan
Title: Assistant Treasurer
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SIGNATURES
Pursuant to the requirements of the Securities
Exchange Act of 1934, as amended, the registrant has duly caused this report to
be signed on their behalf by the undersigned hereunto duly authorized.
American Express Receivables Financing
Corporation II
on behalf of the American Express Credit
Account Master Trust
By: /s/ Leslie R. Scharfstein
--------------------------------------------
Name: Leslie R. Scharfstein
Title: President
4
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EXHIBIT INDEX
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Exhibit Description
Exhibit 99.01 Series Term Sheet, dated August 2, 1999 with respect to the
proposed issuance of the Class A Floating Rate Asset
Backed Certificates and the Class B Floating Rate Asset
Backed Certificates of the American Express Credit
Account Master Trust, Series 1999-4.
5
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EXHIBIT 99.01
<PAGE>
SUBJECT TO REVISION
SERIES TERM SHEET, DATED AUGUST 2, 1999
American Express Credit Account Master Trust
Issuer
American Express Centurion Bank
American Express Receivables Financing Corporation II
Transferors
American Express Travel Related Services Company, Inc.
Servicer
SERIES 1999-4
$412,500,000 Class A Floating Rate Asset Backed Certificates
$40,000,000 Class B Floating Rate Asset Backed Certificates
THE SERIES 1999-4 CERTIFICATES WILL REPRESENT INTERESTS IN THE TRUST
ONLY AND WILL NOT REPRESENT INTERESTS IN OR OBLIGATIONS OF THE TRANSFERORS OR
ANY AFFILIATE THEREOF. NONE OF THE SERIES 1999-4 CERTIFICATES, THE UNDERLYING
ACCOUNTS OR THE RECEIVABLES ARE INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT
INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY.
THIS SERIES TERM SHEET CONTAINS STRUCTURAL AND COLLATERAL INFORMATION
ABOUT THE SERIES 1999-4 CERTIFICATES; HOWEVER, THIS SERIES TERM SHEET DOES NOT
CONTAIN COMPLETE INFORMATION ABOUT THE SERIES 1999-4 CERTIFICATES. THE
INFORMATION PROVIDED HEREIN IS PRELIMINARY, LIMITED IN NATURE AND SUBJECT TO
COMPLETION OR AMENDMENT AND WILL BE SUPERSEDED BY THE INFORMATION CONTAINED IN
THE PROSPECTUS SUPPLEMENT AND THE PROSPECTUS. ADDITIONAL INFORMATION WILL BE
CONTAINED IN THE PROSPECTUS SUPPLEMENT AND THE PROSPECTUS. PURCHASERS ARE URGED
TO READ BOTH THE PROSPECTUS SUPPLEMENT AND THE PROSPECTUS.
THIS SERIES TERM SHEET SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY, NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
SALES OF THE SERIES 1999-4 CERTIFICATES MAY NOT BE CONSUMMATED UNLESS THE
PURCHASER HAS RECEIVED BOTH THE PROSPECTUS SUPPLEMENT AND THE PROSPECTUS.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION.
Underwriters of the Class A Certificates
Credit Suisse First Boston
Chase Securities Inc.
Goldman, Sachs & Co.
Lehman Brothers
Ormes Capital Markets, Inc. The Williams Capital Group, L.P.
Underwriters of the Class B Certificates
Credit Suisse First Boston Lehman Brothers
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SUMMARY OF SERIES TERMS
This Series Term Sheet will be superseded in its entirety by the
information appearing in the Prospectus Supplement, the Prospectus and the
Series 1999-4 Supplement to the Pooling and Servicing Agreement. The information
below addresses only certain limited aspects of the Series 1999-4 Certificates
and their investment characteristics and does not purport to provide a complete
description of such Series 1999-4 Certificates
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<S> <C>
Issuer............................................... American Express Credit Account Master Trust.
Title of Securities.................................. Class A Floating Rate Asset Backed Certificates, Series
1999-4.
Class B Floating Rate Asset Backed Certificates, Series
1999-4.
Initial Invested Amount.............................. $500,000,000.
Class A Initial Invested Amount...................... $412,500,000.
Class B Initial Invested Amount...................... $40,000,000.
Collateral Initial Invested Amount................... $47,500,000.
Class A Certificate Rate............................. One-month LIBOR plus __% per annum.
Class B Certificate Rate............................. One-month LIBOR plus __% per annum.
Distribution Dates................................... The fifteenth day of each month (or, if that day is not
a business day, the next business day); the first
distribution date is September 15, 1999.
Expected Final Payment Date.......................... The July 2002 Distribution Date.
Controlled Accumulation Amount....................... For each distribution date with respect to the controlled
accumulation period, $37,708,333.33. However, if the
beginning of the controlled accumulation period is
delayed, the controlled accumulation amount would be
greater. The controlled accumulation period is scheduled
to commence at the close of business on the last day of
the June 2001 monthly period.
Series Issuance Date................................. August __, 1999.
Series Termination Date.............................. The February 2005 distribution date.
Group................................................ Group II.
</TABLE>
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SUMMARY OF SERIES PROVISIONS
THE TRUST
The certificates will be issued by the American Express Credit Account Master
Trust. The trust is a master trust and its trustee is The Bank of New York.
THE TRANSFERORS AND THE SERVICER
American Express Centurion Bank and American Express Receivables Financing
Corporation II are the transferors of the receivables to the trust and American
Express Travel Related Services Company, Inc. is the servicer of the
receivables.
OFFERED SECURITIES
American Express Credit Account Master Trust is offering:
$412,500,000 of Class A Certificates; and
$40,000,000 of Class B Certificates.
In this document, references to Series 1999-4 Certificates include both Class A
and Class B Certificates.
Beneficial interests in the Series 1999-4 Certificates may be purchased in
minimum denominations of $1,000 and integral multiples of $1,000.
The Series 1999-4 Certificates are expected to be issued on August __, 1999.
Distribution Dates
The distribution dates for the Series 1999-4 Certificates will commence
September 15, 1999 and, after that, will be the 15th day of each month, if the
15th day is a business day and, if not, the following business day.
Interest
Interest on the Series 1999-4 Certificates will be paid on each distribution
date. The Series 1999-4 certificates will accrue interest for each interest
period at the Class A certificate rate and the Class B certificate rate, as
applicable, set on the related LIBOR determination date.
The Class A certificate rate will be a per annum rate equal to __% over
one-month LIBOR.
The Class B certificate rate will be a per annum rate equal to __% over
one-month LIBOR.
Interest accrued during each interest period will be due on each distribution
date. Any interest due but not paid on a distribution date will be payable on
the next distribution date together with additional interest at, as applicable,
the Class A certificate rate or the Class B certificate rate plus 2% per annum.
o Each "interest period" begins on and includes a distribution date and ends
on and excludes the next distribution date. However, the first interest
period will begin on and include August __, 1999, which is the Series
1999-4 closing date, and end on and exclude September 15, 1999, the first
distribution date.
o LIBOR is the rate for deposits in U.S. dollars for a one-month period which
appears on the Dow Jones Telerate Page 3750 (or similar replacement page)
as of 11:00 a.m. London time, on the related LIBOR determination date.
o "LIBOR determination dates" are:
o August __,1999, for the period beginning on and including the Series
1999-4 closing date and ending on and excluding September 15, 1999;
and
o the second London business day prior to the first day of each interest
period, for each interest period following the first interest period.
Principal
Principal on the Series 1999-4 Certificates is expected to be paid on the July
2002 distribution date, or, if that date is not a business day, the next
business day. However, certain circumstances could cause principal to be paid
earlier or later, or in reduced amounts. There is no penalty for early or late
payment of principal. If certain adverse events known as pay-out events occur,
principal may be paid earlier than
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expected. If collections of the credit card receivables are less than expected
or are collected more slowly than expected, then principal payments may be
delayed. No principal will be paid on the Class B Certificates until the Class A
Certificates are paid in full. The final payment of principal and interest on
the Series 1999-4 Certificates will be made no later than the February 2005
distribution date.
THE COLLATERAL INTEREST
The trust is also issuing an interest in the assets of the trust that is
subordinated to the Series 1999-4 Certificates called the collateral interest.
The initial size of the collateral interest is $47,500,000, representing 9.5% of
the initial aggregate principal amount of the Series 1999-4 Certificates and the
collateral interest. The holder of the collateral interest will have voting and
certain other rights as if the collateral interest were a subordinated class of
Series 1999-4 Certificates.
The collateral interest is not being offered through the prospectus supplement
and accompanying prospectus.
CREDIT ENHANCEMENT
Credit enhancement for the Series 1999-4 Certificates is for the benefit of
Series 1999-4 only, and you are not entitled to the benefits of any credit
enhancement available to other series of certificates issued by the trust.
Subordination of the Class B Certificates provides credit enhancement for the
Class A Certificates. Subordination of the collateral interest provides credit
enhancement for both the Class A Certificates and the Class B Certificates. The
collateral invested amount and the Class B invested amount must be reduced to
zero before the Class A invested amount will suffer any loss of principal or
interest. The collateral invested amount must be reduced to zero before the
Class B invested amount will suffer any loss of principal or interest.
OTHER INTERESTS IN THE TRUST
Other Series of Certificates
The trust has issued other series of certificates, is issuing another series of
certificates simultaneously with this series and expects to issue additional
series of certificates. When issued by the trust, the certificates of each of
those series also represent an interest in the assets of the trust. The trust
may issue additional series with terms that may be different from any other
series without the prior review or consent of any certificateholders. The
material terms of the previously issued and outstanding series of certificates
are described in Annex I hereto.
The Transferor Certificates
The interest in the trust not represented by the Series 1999-4 Certificates, the
collateral interest and the other interests issued by the trust is the
transferors' interest and is represented by the transferor certificates. The
transferors' interest does not provide credit enhancement for your series or any
other series.
THE RECEIVABLES
The primary assets of the trust are receivables in designated Optima(Registered
Mark)* Card, Optima Line of Credit and Sign & Travel(Registered Mark)* revolving
credit accounts and, in the future, may include other charge or credit accounts
or products. The receivables consist of principal receivables and finance charge
receivables.
COLLECTIONS BY THE SERVICER
The servicer will collect payments on the receivables, will deposit those
collections in an account and will keep track of those collections that are
finance charge receivables and those that are principal receivables.
ALLOCATIONS TO YOU AND YOUR SERIES
Each month, the Servicer will allocate collections of finance charge
receivables, collections of principal receivables and the amount of receivables
that are not collected and are written off as uncollectible, called the
defaulted amount. Set forth below, is a brief description of how these finance
charge collections, principal collections and defaulted amounts are
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*Optima(Registered Mark) and Sign & Travel(Registered Mark) are federally
registered servicemarks of American Express Company and its affiliates.
4
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allocated to you and your series, addressed in four steps. Allocations of
finance charge collections involve each of Steps 1, 2, 3 and 4. However,
allocations of principal collections and the defaulted amount involve only Steps
1, 2 and 4.
The following discussion is a simplified description of certain allocation
provisions and is qualified by the full descriptions of these provisions in the
Series 1999-4 prospectus supplement and the accompanying prospectus.
Step 1: Allocations Among Series
Finance Charge Collections, Principal Collections and Defaulted Amount: Each
month, the servicer will allocate finance charge collections, principal
collections and the defaulted amount among:
o your series, based on the size of its invested amount (initially
$500,000,000); and
o other outstanding series, based on the sizes of their respective
invested amounts.
Step 2: Allocations Within Your Series
Finance Charge Collections, Principal Collections and Defaulted Amount: Finance
charge collections, principal collections and the defaulted amount that are
allocated to your series in Step 1 will then be further allocated, based on
varying percentages, between:
o the Series 1999-4 Certificates and the collateral interest, based on
the size of the invested amount of your series; and
o the transferors' interest, which will receive the remainder of these
finance charge collections, principal collections and defaulted
amounts.
Step 3: Reallocations Among Series in Group II
Finance Charge Collections: Collections of finance charge receivables allocated
to the Series 1999-4 Certificates and the collateral interest in Step 2 will
then be combined with the collections of finance charge receivables allocated to
any other series in Group II. These collections will then be reallocated among
the series in Group II (including your series) based upon the relative size of
the required payments to each series in Group II as compared to the total
required payments of all series in Group II.
Step 4: Final Allocations Among Class A, Class B and the Collateral Interest
Finance Charge Collections, Principal Collections and Defaulted Amount: The
finance charge collections reallocated to your series in Step 3, together with
the principal collections and defaulted amount allocated to your series in Step
2, will then be further allocated, based on varying percentages, among:
o the Class A Certificates, based on the Class A invested amount
(initially $412,500,000);
o the Class B Certificates, based on the Class B invested amount
(initially $40,000,000); and
o the collateral interest, based on the collateral invested amount
(initially $47,500,000).
The Series 1999-4 Certificates will be the third series issued by the trust in
Group II. The fourth series in Group II, Series 1999-5, is being issued
simultaneously with Series 1999-4. Any issuance of a new series in Group II may
reduce or increase the amount of finance charge collections allocated to the
Series 1999-4 Certificates.
You are entitled to receive payments of interest and principal based upon
allocations to your series. The invested amount, which is the primary basis for
allocations to your series, is the sum of (a) the Class A invested amount, (b)
the Class B invested amount and (c) the collateral invested amount. The Class A
invested amount, the Class B invested amount and the collateral invested amount
will initially equal the outstanding principal amount of the Class A
Certificates, the Class B Certificates and the collateral interest. The invested
amount of a series or class will decline as a result of principal payments and
may decline if receivables are written off or for other reasons. If the invested
amount for your series or class
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declines, amounts allocated and available for payment to you may be reduced.
APPLICATIONS OF COLLECTIONS
Finance Charge Collections
Collections of finance charge receivables allocated to the Class A Certificates
will be used to pay interest due to Class A and, under certain circumstances,
Class A's portion of the servicing fee due to the servicer 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 due to Class B and, under certain circumstances,
Class B's portion of the servicing fee due to the servicer. 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, under certain circumstances, to pay the collateral interest's
portion of the servicing fee due to the servicer. Any remaining amount will
become excess spread and be applied as described below.
Excess Spread
Each month the excess spread will be used in the following order of priority:
o first to make up deficiencies to Class A;
o then to make up deficiencies to Class B;
o then to pay interest on the collateral interest and to make up
deficiencies to the collateral interest;
o then to make up deficiencies that are owed to the servicer;
o then to make up for reductions of the collateral invested amount if it
is below its minimum required amount;
o then to fund, if necessary, a reserve account maintained to cover
certain interest payment shortfalls, if any;
o then to pay any other amounts owing to the provider of the collateral
interest; and
o finally to other series or to the holders of the transferor
certificates.
Principal Collections
Your series' share of principal collections will be applied each month as
follows:
Collections of principal receivables allocated to the collateral interest and
the Class B Certificates may be reallocated, if necessary, to make payments due
on the Class A Certificates that have not been paid by either the Class A's
share of collections of finance charge receivables or excess spread. If required
Class A amounts are satisfied, the collateral interest also provides the same
type of protection to the Class B Certificates.
Collections of principal receivables allocated to your series and not used as
described in the preceding paragraph are combined with shared principal
collections from other series, to the extent necessary and available, and
treated as "available principal collections".
Available principal collections may be paid, or accumulated and then paid, to
you as payments of principal. The amount, priority and timing of your principal
payments, if any, depend on whether your series is in the revolving period, the
controlled accumulation period or the early amortization period.
During the revolving period, no principal will be paid to you or accumulated in
a trust account.
During the controlled accumulation period, principal collections will be
deposited in a trust account, up to a controlled amount, to pay first the Class
A invested amount, then to pay the Class B invested amount and then to pay the
collateral invested amount on their expected final payment date.
During the early amortization period, principal collections will be used to pay
first the Class A invested amount, then to pay the Class B
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invested amount and then to pay the collateral invested amount.
As available principal collections are accumulated for the Class A Certificates
and the Class B Certificates during the controlled accumulation period, the
minimum required credit enhancement (i.e., the collateral interest) will
decrease and the available principal collections will be paid to the holder of
the collateral interest to the extent of this decrease.
Collections of principal receivables allocated to your series and not used as
described above may be paid to other series, to the extent necessary, or to the
holders of the transferor certificates.
PAY-OUT EVENTS
Certain adverse events called pay-out events might lead to the start of an early
amortization period. A pay-out event for your series will include the following
events:
o any transferor does not make any required payment or deposit within
five business days of the date such payment or deposit is due;
o any transferor materially violates any other obligation or agreement
causing you to be adversely affected, if (a) the transferor does not
remedy the violation within 60 days after it has received written
notice and (b) you continue to be materially and adversely affected for
the 60-day period;
o any transferor provides certain representations, warranties or other
information which were materially incorrect at the time they were
provided causing you to be adversely affected, if (a) they continue to
be materially incorrect 60 days after the transferor has received
written notice and (b) you continue to be materially and adversely
affected for the 60-day period;
o a transferor fails to transfer additional assets to the trust within
five business days after the date required;
o certain defaults by the servicer that have a material adverse effect
on you;
o the net yield on the trust portfolio allocated to Series 1999-4
averaged over three consecutive months is less than the weighted
average interest rate for Series 1999-4, calculated by taking into
account the interest rate on Class A, Class B and the collateral
interest, plus the servicing fee for Series 1999-4;
o you are not paid in full on the expected final payment date;
o any transferor is unable to transfer receivables to the trust as
required under the pooling and servicing agreement;
o certain events of insolvency or receivership relating to a transferor
or other holder of the original transferor certificate; or
o the trust becomes an "investment company" under the Investment Company
Act of 1940.
REALLOCATED INVESTOR FINANCE CHARGE COLLECTIONS
Collections of finance charge receivables to be allocated to the investor
certificates of each series in Group II will be combined and will be available
for certain required payments to all series in Group II. These amounts will be
reallocated pro rata, based on the size of the required payment for each of the
series in Group II as compared with the total required payments for all of the
series in Group II.
SHARED PRINCIPAL COLLECTIONS
This series will be included in a group of series designated as "principal
sharing series." To the extent that collections of principal receivables
allocated to this series are not needed to make payments or deposits to a trust
account for the benefit of your series, these collections will be applied to
cover principal payments for other principal sharing series, if any. Any
reallocation for this purpose will not reduce the invested amount for your
series. In addition, you may receive the benefits of collections of principal
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receivables and certain other amounts allocated to other principal sharing
series designated to share collections of principal receivables with your
series. However, there can be no assurance that the trust will issue additional
principal sharing series designated to share collections of principal
receivables with your series.
EXCESS FINANCE CHARGE COLLECTIONS
This series will be included in a group of series designated as "excess
allocation series." To the extent that collections of finance charge receivables
allocable to this series exceed the amount necessary to make required payments
for this series payable from collections of finance charge receivables, such
excess collections may be applied to cover shortfalls of collections of finance
charge receivables allocable to other excess allocation series. In addition, you
may receive the benefits of collections of finance charge receivables allocated
to other excess allocation series designated to share collections of finance
charge receivables with your series. However, there can be no assurance that the
trust will issue additional excess allocation series designated to share
collections of finance charge receivables with your series.
OPTIONAL REPURCHASE
The transferors have the option to repurchase your Series 1999-4 Certificates
when the invested amount for your series has been reduced to 5% or less of the
initial invested amount for your series.
REGISTRATION
The Series 1999-4 Certificates will be registered in the name of Cede & Co., as
the nominee of The Depository Trust Company. You will not receive a definitive
certificate representing your interest, except in limited circumstances.
You may elect to hold your Series 1999-4 Certificates through DTC, in the United
States, or Cedelbank or the Euroclear System in Europe.
We expect that the Series 1999-4 Certificates will be delivered in book-entry
form through the facilities of DTC, Cedelbank and Euroclear on or about August
__, 1999.
TAX STATUS
Subject to important considerations described in the Prospectus, Orrick,
Herrington & Sutcliffe LLP, as special tax counsel to the transferors, is of the
opinion that under existing law your Series 1999-4 Certificates will be
characterized as debt for federal income tax purposes and the trust will not be
taxable as a corporation for such purposes.
ERISA CONSIDERATIONS
Subject to important considerations described in the prospectus supplement and
prospectus, the Class A Certificates are eligible for purchase by persons
investing assets of employee benefit plans or individual retirement accounts.
The Class B Certificates are not eligible for purchase by persons investing
assets of employee benefit plans or individual retirement accounts.
CERTIFICATE RATINGS
At issuance, 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.
EXCHANGE LISTING
An application has been made to list the Series 1999-4 Certificates on the
Luxembourg Stock Exchange. We cannot guarantee that the application for the
listing will be accepted. You should consult with Banque Generale du Luxembourg,
the Luxembourg listing agent, for the Series 1999-4 Certificates, 50 J.F.
Kennedy, L-2951, Luxembourg, phone number 352-4242-3175, to determine whether or
not the Series 1999-4 Certificates are listed on the Luxembourg Stock Exchange.
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THE TOTAL PORTFOLIO
General
The primary assets of the trust (the "Trust Portfolio") are receivables
(the "Receivables") generated from time to time in a portfolio of designated
Optima Card, Optima Line of Credit and Sign & Travel revolving credit accounts
and, in the future, may include other charge or credit accounts or products
(collectively, the "Accounts").
The Accounts were selected from the total portfolio of Optima Card,
Optima Line of Credit and Sign & Travel accounts owned by Centurion (the "Total
Portfolio") based upon the eligibility criteria specified in the Pooling and
Servicing Agreement applied with respect to the Accounts as of their selection
date. Set forth below is certain information with respect to the Total
Portfolio. The Total Portfolio's yield, loss, delinquency and payment rate is
comprised of segments which may, when taken individually, have yield, loss,
delinquency and payment rate characteristics different from those of the overall
Total Portfolio of credit card accounts. As of May 31, 1999, the Receivables in
the Trust Portfolio represented approximately 48% of the Total Portfolio.
Because the Trust Portfolio is only a portion of the Total Portfolio, actual
yield, loss, delinquency and payment rate experience with respect to the
Receivables has been and, in the future, may be different from that set forth
below for the Total Portfolio. There can be no assurance that the yield, loss,
delinquency and payment rate experience relating to the Receivables in the Trust
Portfolio will be comparable to the historical experience relating to the
receivables in the Total Portfolio set forth below.
Loss and Delinquency Experience
The following tables set forth the loss and delinquency experience for
the Total Portfolio for each of the periods shown.
Loss Experience of the Total Portfolio
(Dollars in Thousands)
<TABLE>
<CAPTION>
Five Months Ended Year ended December 31,
May 31, 1999 1998 1997 1996
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<S> <C> <C> <C> <C>
Average Receivables Outstanding (1) $16,007,152 $14,401,299 $13,180,931 $10,535,181
Total Gross Charge-Offs (2) 394,165 971,146 888,025 664,702
Total Recoveries 59,470 118,334 111,577 104,190
------------ ------------ ------------ -----------
Total Net Charge-Offs (3) $ 334,694 $ 852,812 $ 776,448 $ 560,512
============ ============ ============ ===========
Total Net Charge-Offs as a
Percentage of Average
Receivables Outstanding 5.02%(4) 5.92% 5.89% 5.32%
</TABLE>
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(1) Average Receivables Outstanding for each indicated period is calculated
as the average of the month-end receivables balances for such period.
(2) Total Gross Charge-Offs for each indicated period include charge-offs
of principal, finance charges and certain fees for such period.
(3) Total Net Charge-Offs for each indicated period is equal to Total Gross
Charge-Offs for such period, net of recoveries during such period.
(4) This percentage is an annualized figure.
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Average Receivables Delinquent as a Percentage of the Total Portfolio (1)
(Dollars in Thousands)
<TABLE>
<CAPTION>
Year Ended December 31,
Five Months Ended -------------------------------------------------------------------------------
May 31, 1999 1998 1997 1996
-------------------------- -------------------------- --------------------------- -----------------------
Percentage Percentage Percentage Percentage
of of of of
Average Average Average Average
Dollar Receivables Dollar Receivables Dollar Receivables Dollar Receivables
Amount Outstanding(2) Amount Outstanding(2) Amount Outstanding(2) Amount Outstanding(2)
------ -------------- ------ -------------- ------ --------------- ------ -------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Average Receivables
Outstanding (3) $16,007,152 100.00% $14,401,299 100.00% $13,180,931 100.00% $10,535,181 100.00%
Average Receivables
Delinquent:
31 to 60 Days....... 222,351 1.39% 225,604 1.57% 225,595 1.71% 181,542 1.72%
61 to 90 Days....... 114,066 0.71% 113,929 0.79% 107,950 0.82% 79,733 0.76%
91 Days or More .... 154,736 0.97% 154,796 1.07% 141,085 1.07% 103,384 0.98%
------- ---- ------- ---- ------- ---- ------- ----
Total........ $491,153 3.07% $494,330 3.43% $474,629 3.60% $364,659 3.46%
======== ==== ======== ==== ======== ==== ======== ====
</TABLE>
- ---------------
(1) Average Receivables Delinquent for each indicated period is calculated
as the average of month-end delinquent amounts for such period.
(2) The resulting percentages are the result of dividing the Average
Receivables Delinquent for the indicated period by the Average
Receivables Outstanding for such Period.
(3) Average Receivables Outstanding for each indicated period is calculated
as the average of the month-end receivables balances for such period.
Revenue Experience
The revenues for the Total Portfolio from finance charges and fees
billed to account holders are set forth in the following table for each of the
periods shown.
The historical revenue figures in the tables include interest on
purchases and cash advances and fees accrued during the cycle. Cash collections
on the receivables may not reflect the historical experience in the table.
During periods of increasing delinquencies, billings of finance charges and fees
may exceed cash payments as amounts collected on receivables lag behind amounts
billed to account holders. Conversely, as delinquencies decrease, cash payments
may exceed billings of finance charges and fees as amounts collected in a
current period may include amounts billed during prior periods. Revenues from
finance charges and fees on both a billed and a cash basis will be affected by
numerous factors, including the periodic finance charges on the receivables, the
amount of fees paid by account holders, the percentage of account holders who
pay off their balances in full each month and do not incur periodic finance
charges on purchases and changes in the level of delinquencies on the
receivables.
10
<PAGE>
Revenue Experience of the Total Portfolio
(Dollars in Thousands)
<TABLE>
<CAPTION>
Year ended December 31,
Five Months Ended -------------------------------------------
May 31, 1999 1998 1997 1996
----------------- ------------- -------------- -----------
<S> <C> <C> <C> <C>
Average Receivables Outstanding (1) $16,007,152 $14,401,299 $13,180,931 $10,535,181
Total Finance Charges and Fees Billed (2) 977,153 2,223,302 2,007,506 1,598,793
Total Finance Charges and Fees Billed as a
Percentage of Average Receivables Outstanding 14.65%(3) 15.44% 15.23% 15.18%
</TABLE>
- ---------------
(1) Average Receivables Outstanding for each indicated period is calculated
as the average of the month-end receivables balances for such period.
(2) Total Finance Charges and Fees Billed are comprised of periodic finance
charges, cash advance fees, annual membership fees and certain other
fees.
(3) This percentage is an annualized figure.
The revenues for the Total Portfolio shown in the table above are
related to finance charges, together with certain fees, billed to holders of the
accounts. The revenues related to finance charges depend in part upon the
collective preference of account holders to use their accounts as revolving
credit facilities for purchases and cash advances and paying off account
balances over several months as opposed to convenience use, where the account
holders prefer instead to pay off their entire account balance each month,
thereby avoiding finance charges. Revenues related to finance charges and fees
also depend on the types of charges and fees assessed by the Account Owners on
the accounts in the Total Portfolio. Accordingly, revenues will be affected by
future changes in the types of charges and fees assessed on the accounts and
other factors. Neither the Servicer nor any Account Owner nor any of their
respective affiliates has any basis to predict how any future changes in the use
of the accounts by account holders or in the terms of accounts may affect the
revenue for the Total Portfolio.
Payment Rates
The following table sets forth the highest and lowest account holder
monthly payment rates for the Total Portfolio during any month in the period
shown and the average account holder monthly payment rates for all months during
each period shown, calculated as the percentage equivalent of a fraction. For
the highest and lowest monthly payment rates, the numerator of the fraction is
equal to all payments from account holders as posted to the accounts during the
applicable month, and the denominator is equal to the aggregate amount of
receivables billed to account holders during the prior month. For the monthly
average payment rate, the numerator of the fraction is equal to all payments
from account holders as posted to the accounts during the indicated period,
divided by the number of months in the period, and the denominator is equal to
the average of the month-end receivables balances for such period.
Account Holder Monthly Payment Rates of the Total Portfolio
<TABLE>
<CAPTION>
Year ended December 31,
Five Months Ended ----------------------------------------------
May 31, 1999 1998 1997 1996
--------------------- --------------- -------------- -----------
<S> <C> <C> <C> <C>
Lowest Month.......................... 14.71% 14.53% 12.99% 9.98%
Highest Month......................... 15.51% 15.33% 14.53% 12.66%
Monthly Average....................... 15.10% 15.02% 13.68% 11.51%
</TABLE>
11
<PAGE>
THE RECEIVABLES
The Receivables (including Receivables in Accounts closed at the
request of account holders) in the accounts, as of May 31, 1999, totaled
$7,685,111,223, comprised of $7,529,613,343 of principal receivables and
$155,497,880 of finance charge receivables.
In the following two paragraphs and in all of the following tables,
references to "Accounts," "Receivables," "Receivables Outstanding" and "Total
Receivables" include, respectively, all Accounts other than Accounts closed at
the request of account holders and all Receivables (including both finance
charge receivables and principal receivables) other than Receivables in Accounts
closed at the request of account holders.
The following tables summarize the Trust Portfolio by various criteria
as of May 31, 1999. Because the future composition of the Trust Portfolio may
change over time, these tables are not necessarily, indicative of the
composition of the Trust Portfolio at any time subsequent to May 31, 1999.
Composition by Account Balance
Trust Portfolio
<TABLE>
<CAPTION>
Percentage of Percentage of Total
Account Balance Number of Total Number Receivables Receivables
Range Accounts of Accounts Outstanding Outstanding
- ---------------------- ----------------- ------------------ ----------------------- ---------------------
<S> <C> <C> <C> <C>
Credit Balance...... 51,404 0.9% $ (6,023,372) -0.1%
Zero Balance........ 2,726,688 49.8% 0 0.0%
$1 - $1,000......... 1,057,056 19.3% 397,659,781 5.2%
$1,001 - $5,000..... 1,150,101 21.0% 2,921,369,651 38.3%
$5,001 - $10,000.... 356,506 6.5% 2,486,465,731 32.6%
$10,001 - More...... 128,965 2.4% 1,824,405,134 23.9%
--------- ----- -------------- -----
Total...... 5,470,720 100.0% $ 7,623,876,925 100.0%
========= ===== ============== =====
</TABLE>
Composition by Credit Limit
Trust Portfolio
<TABLE>
<CAPTION>
Percentage of Percentage of Total
Account Balance Number of Total Number Receivables Receivables
Range Accounts of Accounts Outstanding Outstanding
- ---------------------- ----------------- ------------------ ----------------------- ---------------------
<S> <C> <C> <C> <C>
Less than $1,000........... 410,639 7.5% $ 97,031,204 1.3%
$1,001 - $5,000............ 1,500,191 27.4% 1,158,831,601 15.2%
$5,001 - $10,000........... 1,531,416 28.0% 1,951,086,280 25.6%
$10,001 and Up............. 564,471 10.3% 1,985,328,331 26.0%
--------- ----- -------------- -----
Total (Optima)........ 4,006,717 73.2% 5,192,277,416 68.1%
No Pre-Set Spending Limit
(Sign & Travel)............ 1,464,003 26.8% 2,431,599,509 31.9%
--------- ------ -------------- ------
Total................. 5,470,720 100.0% $7,623,876,925 100.0%
========= ====== ============== ======
</TABLE>
12
<PAGE>
Composition by Period of Delinquency
Trust Portfolio
<TABLE>
<CAPTION>
Percentage of Percentage of Total
Number of Total Number Receivables Receivables
Period of Delinquency (Days Accounts of Accounts Outstanding Outstanding
Contractually Delinquent)
----------------- ------------------ ----------------------- -----------------------
<S> <C> <C> <C> <C>
Current to 30 Days......... 5,394,223 98.6% $7,378,948,732 96.8%
31 to 60 Day............... 34,976 0.6% 98,747,559 1.3%
61 to 90 Days.............. 15,088 0.3% 52,217,934 0.7%
91 or More Days............ 26,433 0.5% 93,962,700 1.2%
--------- ------ -------------- ------
Total................. 5,470,720 100.0% $7,623,876,925 100.0%
========= ===== ============== ======
</TABLE>
Composition by Account Age
Trust Portfolio
<TABLE>
<CAPTION>
Percentage of Percentage of Total
Number of Total Number Receivables Receivables
Account Age Accounts of Accounts Outstanding Outstanding
- ---------------------- ----------------- ------------------ ----------------------- ---------------------
<S> <C> <C> <C> <C>
Not More than 12 Months....... 237,890 4.3% $ 99,837,117 1.3%
12 Months to 17 Months........ 154,575 2.8% 164,871,422 2.2%
18 Months to 23 Months........ 292,764 5.4% 343,115,546 4.5%
24 Months to 35 Months........ 816,287 14.9% 1,150,493,532 15.1%
36 Months to 47 Months........ 674,483 12.3% 915,844,109 12.0%
48 Months to 59 Months........ 809,220 14.8% 1,005,548,192 13.2%
60 Months to 71 Months........ 867,232 15.9% 796,597,569 10.4%
72 Months and Greater......... 1,618,269 29.6% 3,147,569,438 41.3%
--------- ---- ------------- ----
Total..................... 5,470,720 100.0% $7,623,876,925 100.0%
========= ===== ============== =====
</TABLE>
As of May 31, 1999, approximately 15.85%, 11.74%, 9.13%, 8.04% and
5.91% of the Receivables related to account holders having billing addresses in
California, New York, Texas, Florida, and New Jersey, respectively. Not more
than 5% of the Receivables related to account holders having billing addresses
in any other single state.
13
<PAGE>
ANNEX I
OTHER SERIES
The table below sets forth the principal characteristics of all other
series issued by the trust and currently outstanding. For more specific
information with respect to the Series listed below, any prospective investor
should contact American Express Centurion Bank at (801) 565-5023. Centurion will
provide, without charge, to any prospective purchaser of the Series 1999-4
Certificates, a copy of the Prospectus Supplement for any series listed below.
<TABLE>
<S> <C>
Series 1996-1
Initial Invested Amount..............................................................................$1,000,000,000
Class A Initial Invested Amount........................................................................$865,000,000
Class A Certificate Rate............................................................................6.80% per annum
Class B Initial Invested Amount.........................................................................$60,000,000
Class B Certificate Rate............................................................................6.95% per annum
Controlled Accumulation Amount (subject to adjustment)...............................................$77,083,333.34
Commencement of Controlled Accumulation Period (subject to adjustment)..................................May 1, 2000
Annual Servicing Fee Percentage......................................................................2.0% per annum
Collateral Initial Invested Amount......................................................................$75,000,000
Enhancement for the Class A and Class B Certificates.....................................Collateral Invested Amount
Other enhancement for the Class A Certificates............................Subordination of the Class B Certificates
Expected Final Payment Date..............................................................May 2001 Distribution Date
Series Issuance Date...................................................................................May 16, 1996
Group.......................................................................................................Group I
Series 1997-1
Initial Invested Amount..............................................................................$1,000,000,000
Class A Initial Invested Amount........................................................................$865,000,000
Class A Certificate Rate............................................................................6.40% per annum
Class B Initial Invested Amount.........................................................................$60,000,000
Class B Certificate Rate............................................................................6.55% per annum
Controlled Accumulation Amount (subject to adjustment)...............................................$77,083,333.34
Commencement of Controlled Accumulation Period (subject to adjustment)............................September 1, 2001
Annual Servicing Fee Percentage......................................................................2.0% per annum
Collateral Initial Invested Amount......................................................................$75,000,000
Enhancement for the Class A and Class B Certificates.....................................Collateral Invested Amount
Other enhancement for the Class A Certificates............................Subordination of the Class B Certificates
Expected Final Payment Date........................................................September 2002 Distribution Date
Series Issuance Date................................................................................August 28, 1997
Group.......................................................................................................Group I
Series 1998-1
Initial Invested Amount..............................................................................$1,000,000,000
Class A Initial Invested Amount........................................................................$825,000,000
Class A Certificate Rate.......................................................One-Month LIBOR plus 0.09% per annum
Class B Initial Invested Amount.........................................................................$80,000,000
Class B Certificate Rate.......................................................One-Month LIBOR plus 0.25% per annum
Controlled Accumulation Amount (subject to adjustment)...............................................$75,416,666.67
Commencement of Controlled Accumulation Period (subject to adjustment).................................June 1, 2002
Annual Servicing Fee Percentage......................................................................2.0% per annum
Collateral Initial Invested Amount......................................................................$95,000,000
Enhancement for the Class A and Class B Certificates.....................................Collateral Invested Amount
Other enhancement for the Class A Certificates............................Subordination of the Class B Certificates
Expected Final Payment Date.............................................................June 2003 Distribution Date
Series Issuance Date..................................................................................June 23, 1998
Group......................................................................................................Group II
</TABLE>
A-1
<PAGE>
<TABLE>
<S> <C>
Series 1999-1
Initial Invested Amount..............................................................................$1,000,000,000
Class A Initial Invested Amount........................................................................$865,000,000
Class A Certificate Rate............................................................................5.60% per annum
Class B Initial Invested Amount.........................................................................$60,000,000
Class B Certificate Rate............................................................................5.85% per annum
Controlled Accumulation Amount (subject to adjustment)...............................................$77,083,333.34
Commencement of Controlled Accumulation Period (subject to adjustment)................................April 1, 2003
Annual Servicing Fee Percentage......................................................................2.0% per annum
Collateral Initial Invested Amount......................................................................$75,000,000
Enhancement for the Class A and Class B Certificates.....................................Collateral Invested Amount
Other enhancement for the Class A Certificates............................Subordination of the Class B Certificates
Expected Final Payment Date............................................................April 2004 Distribution Date
Series Issuance Date.................................................................................April 21, 1999
Principal Sharing Series........................................................................................Yes
Excess Allocation Series........................................................................................Yes
Group.......................................................................................................Group I
Series 1999-2
Initial Invested Amount................................................................................$500,000,000
Class A Initial Invested Amount........................................................................$432,500,000
Class A Certificate Rate............................................................................5.95% per annum
Class B Initial Invested Amount.........................................................................$30,000,000
Class B Certificate Rate............................................................................6.10% per annum
Controlled Accumulation Amount (subject to adjustment)...............................................$38,541,666.67
Commencement of Controlled Accumulation Period (subject to adjustment)..................................May 1, 2003
Annual Servicing Fee Percentage......................................................................2.0% per annum
Collateral Initial Invested Amount......................................................................$37,500,000
Enhancement for the Class A and Class B Certificates.....................................Collateral Invested Amount
Other enhancement for the Class A Certificates............................Subordination of the Class B Certificates
Expected Final Payment Date..............................................................May 2004 Distribution Date
Series Issuance Date...................................................................................May 19, 1999
Principal Sharing Series........................................................................................Yes
Excess Allocation Series........................................................................................Yes
Group.......................................................................................................Group I
Series 1999-3
Initial Invested Amount..............................................................................$1,000,000,000
Class A Initial Invested Amount........................................................................$825,000,000
Class A Certificate Rate.......................................................One-Month LIBOR plus 0.14% per annum
Class B Initial Invested Amount.........................................................................$80,000,000
Class B Certificate Rate.......................................................One-Month LIBOR plus 0.34% per annum
Controlled Accumulation Amount (subject to adjustment)...............................................$75,416,666.67
Commencement of Controlled Accumulation Period (subject to adjustment)..................................May 1, 2003
Annual Servicing Fee Percentage......................................................................2.0% per annum
Collateral Initial Invested Amount......................................................................$95,000,000
Enhancement for the Class A and Class B Certificates.....................................Collateral Invested Amount
Other enhancement for the Class A Certificates............................Subordination of the Class B Certificates
Expected Final Payment Date..............................................................May 2004 Distribution Date
Series Issuance Date...................................................................................May 19, 1999
Principal Sharing Series........................................................................................Yes
Excess Allocation Series........................................................................................Yes
Group......................................................................................................Group II
</TABLE>
A-2
<PAGE>
<TABLE>
<S> <C>
Series 1999-5
Initial Invested Amount................................................................................$500,000,000
Class A Initial Invested Amount........................................................................$412,500,000
Class A Certificate Rate.........................................................One-Month LIBOR plus __% per annum
Class B Initial Invested Amount.........................................................................$40,000,000
Class B Certificate Rate.........................................................One-Month LIBOR plus __% per annum
Controlled Accumulation Amount (subject to adjustment)...............................................$37,708,333.33
Commencement of Controlled Accumulation Period (subject to adjustment)....................................June 2003
Annual Servicing Fee Percentage......................................................................2.0% per annum
Collateral Initial Invested Amount......................................................................$47,500,000
Enhancement for the Class A and Class B Certificates.....................................Collateral Invested Amount
Other enhancement for the Class A Certificates............................Subordination of the Class B Certificates
Expected Final Payment Date.............................................................July 2004 Distribution Date
Series Issuance Date................................................................................August __, 1999
Principal Sharing Series........................................................................................Yes
Excess Allocation Series........................................................................................Yes
Group......................................................................................................Group II
</TABLE>
A-3
