Exhibit 10.7

SERIES 2006-ONE SUPPLEMENT

Dated as of March 10, 2006

to

MASTER INDENTURE

Dated as of March 10, 2006

Series 2006-One Asset Backed Notes

Class A Floating Rate Asset Backed Variable Funding Notes

Class B Asset Backed Variable Funding Notes

 

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COMPUCREDIT CREDIT CARD MASTER NOTE BUSINESS TRUST III

SERIES 2006-ONE

 

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among

COMPUCREDIT CREDIT CARD MASTER NOTE BUSINESS TRUST III

Issuer

COMPUCREDIT CORPORATION

Servicer

and

U.S. BANK NATIONAL ASSOCIATION

Indenture Trustee

on behalf of the Series 2006-One Noteholders

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TABLE OF CONTENTS

 

          Page   

ARTICLE I

     

Creation of the Series 2006-One Notes

  

Section 1.01.

   Designation    1   

ARTICLE II

     

Definitions

  

Section 2.01.

   Definitions    2   

ARTICLE III

     

Servicing Fee and Interchange

  

Section 3.01.

   Servicing Compensation; Interchange    13   

ARTICLE IV

     

Rights of Series 2006-One Noteholders and Allocation and Application of
Collections

  

Section 4.01.

   Collections and Allocations    14

Section 4.02.

   Determination of Monthly Interest    18

Section 4.03.

   Limited Redemption; Optional Redemption    18

Section 4.04.

   Class A Required Amount    19

Section 4.05.

   Application of Available Funds and Available Principal Collections    19

Section 4.06.

   Defaulted Amounts; Reduction Amounts    21

Section 4.07.

   Reallocated Principal Collections    21

Section 4.08.

   Excess Finance Charge Collections    21

Section 4.09.

   Reallocated Series Finance Charge Collections    22

Section 4.10.

   Shared Principal Collections    23

Section 4.11.

   Spread Account    23

Section 4.12.

   Principal Amount Increases    25

Section 4.13.

   Series 2006-One Distribution Account    26   

ARTICLE V

     

Distributions and Reports to Series 2006-One Noteholders

  

Section 5.01.

   Distributions    27

Section 5.02.

   Reports and Statements to Series 2006-One Noteholders    27   

ARTICLE VI

     

Early Redemption Events

  

Section 6.01.

   Early Redemption Events    29

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TABLE OF CONTENTS

(continued)

 

          Page   

ARTICLE VII

     

Administrative Redemption; Series Termination

  

Section 7.01.

   Administrative Redemption    31

Section 7.02.

   Stated Maturity Date    31   

ARTICLE VIII

     

Redemption of Series 2006-One Notes; Final Distributions

  

Section 8.01.

  

Sale of Receivables or Redemption of the Notes pursuant to

Section 2.06 or 8.01 of the Transfer and Servicing Agreement and

Sections 5.05 and 5.17 of the Indenture and Section 7.01 of this

Supplement

   31   

ARTICLE IX

     

Miscellaneous Provisions

  

Section 9.01.

   Ratification of Agreement    32

Section 9.02.

   Counterparts    32

Section 9.03.

   Governing Law    32

Section 9.04.

   Tax Matters    32

Section 9.05.

   Transfer of Class B Notes    36

Section 9.06.

   Limitation of Liability    36

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EXHIBITS

 

Exhibit A.

  

Form of Class A Note

Exhibit B.

  

Form of Class B Note

Exhibit C.

  

Form of Monthly Servicer’s Statement

Exhibit D.

  

Form of Class B Increase Notice

Exhibit E.

  

Form of Investment Letter

Exhibit F.

  

Agreed Upon Procedures

Schedule A

  

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SERIES 2006-ONE INDENTURE SUPPLEMENT, dated as of March 10, 2006 (this
“Supplement”), among COMPUCREDIT CREDIT CARD MASTER NOTE BUSINESS TRUST III, a
business trust organized and existing under the laws of the State of Nevada (the
“Issuer”), COMPUCREDIT CORPORATION, a Georgia corporation, as Servicer (the
“Servicer”), and U.S. BANK NATIONAL ASSOCIATION, a national banking association,
not in its individual capacity, but solely as Indenture Trustee (together with
its successors in the trusts thereunder as provided in the Indenture, the
“Indenture Trustee”) under the Master Indenture dated as of March 10, 2006 (the
“Indenture”) among the Issuer, the Servicer and the Indenture Trustee.

Section 2.10 of the Indenture provides that the Issuer may pursuant to one or
more Indenture Supplements direct the Indenture Trustee, on behalf of the
Issuer, to issue one or more Series of Notes and to set forth the Principal
Terms of such Series.

Pursuant to this Supplement, the Issuer and the Indenture Trustee shall create a
new Series of Notes and specify the Principal Terms thereof.

ARTICLE I

Creation of the Series 2006-One Notes.

Section 1.01. Designation.

(a) There is hereby created and designated a Series of Notes to be issued
pursuant to the Indenture and this Supplement to be known as “CompuCredit Credit
Card Master Note Business Trust III, Series 2006-One Notes” or the “Series
2006-One Notes.” The Series 2006-One Notes shall be issued in two Classes, the
first of which shall be known as the “Class A Series 2006-One Floating Rate
Asset Backed Variable Funding Notes” and the second of which shall be known as
the “Class B Series 2006-One Asset Backed Variable Funding Notes.”

(b) Series 2006-One shall be included in Group I and shall be a Principal
Sharing Series. Series 2006-One shall be an Excess Allocation Series. Series
2006-One shall not be subordinated to any other Series. Notwithstanding any
provision in the Indenture or in this Supplement to the contrary, the first
Distribution Date with respect to Series 2006-One shall be May 15, 2006. The
Series 2006-One Notes shall be due and payable on the Stated Maturity Date.

(c) In the event that any term or provision contained herein shall conflict with
or be inconsistent with any term or provision contained in the Indenture, the
terms and provisions of this Supplement shall be controlling.

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ARTICLE II

Definitions

Section 2.01. Definitions.

(a) All capitalized terms not otherwise defined herein are defined in the
Indenture, the Transfer and Servicing Agreement or the Trust Agreement
(including by way of reference to other documents). Each capitalized term
defined herein shall relate only to the Series 2006-One Notes and no other
Series of Notes issued by the Issuer. Whenever used in this Supplement, the
following words and phrases shall have the following meanings, and the
definitions of such terms are applicable to the singular as well as the plural
forms of such terms and the masculine as well as the feminine and neuter genders
of such terms.

“Actual Principal Receivables” shall mean, with respect to any Monthly Period,
Eligible Receivables that (a) did not arise in Accounts which as of their date
of origination had utilized more than 60% of their credit limit or (b) are not
more than 90 days delinquent.

“Administrative Agent” shall mean, “                                ” or any
successor to or assignee thereof (to the extent such assignment is permitted
hereunder and under the Class A Note Purchase Agreement).

“Aggregate Subordination Percentage” shall mean, for any date of determination,
the percentage equivalent of a fraction , the numerator of which is 100 minus
the percentage set forth in Item 1 of Schedule A divided by the percentage set
forth in Item 1 of Schedule A.

“Allocation Amount” shall mean, as of any date of determination, an amount equal
to (a) the Initial Note Principal Balance, plus (b) the total amount of Class A
Note Principal Balance Increases and Class B Note Principal Balance Increases on
or prior to such date, minus (c) the total amount of principal payments made on
the Series 2006-One Notes prior to such date, minus (d) the excess, if any of
the total amount of Reduction Amounts for all prior Distribution Dates and
Reallocated Principal Collections that under Section 4.07 were used to fund the
Class A Required Amount on all prior Distribution Dates over such Reduction
Amounts and Reallocated Principal Collections reimbursed pursuant to subsection
4.05(a)(iv) prior to such date.

“Available Funds” shall mean, for any Distribution Date, an amount equal to the
sum of (a) the Reallocated Series Finance Charge Collections, (b) the Excess
Finance Charge Collections allocated to Series 2006-One and (c) the amount of
funds, if any, to be withdrawn from the Spread Account which, pursuant to
subsection 4.11(c), are required to be included in Available Funds with respect
to such Distribution Date.

“Available Principal Collections” shall mean, with respect to any Monthly
Period, an amount equal to the sum of (a) (i) an amount equal to the
Fixed/Floating Allocation Percentage of Series 2006-One Allocable Principal
Collections received during such Monthly Period minus (ii) the amount of
Reallocated Principal Collections with respect to such Monthly Period which
pursuant to Section 4.07 are required to fund the Class A Required Amount for
the related Distribution Date, (b) any Shared Principal Collections with respect
to other Series that

 

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are allocated to Series 2006-One in accordance with Section 4.02 of the Transfer
and Servicing Agreement and Section 4.10 hereof and (c) any other amounts which
pursuant to subsection 4.05(a) hereof are to be treated as Available Principal
Collections with respect to the related Distribution Date.

“Available Spread Account Amount” shall mean, with respect to any Distribution
Date, the lesser of (a) the principal amount on deposit in the Spread Account on
such date (before giving effect to any deposit to be made to the Spread Account
on such date) and (b) the Required Spread Account Amount.

“Average Allocation Amount” shall mean, for any period, the sum of the
Allocation Amounts for each day in such period divided by the number of days in
such period.

“Average Principal Payment Rate” shall mean, for any date of determination, the
sum of the Monthly Principal Payment Rates for the prior two Monthly Periods
divided by two.

“Average Principal Receivables” shall mean, for any period, the sum of the
Principal Receivables for each day in such period divided by the number of days
in such period.

“Borrowing Base Excess Amount” shall mean, with respect to any Distribution
Date, an amount equal to the excess, if any, of the Class A Note Principal
Balance over the sum of (a) the product of (i) the percentage specified in
Item 2 of Schedule A, (ii) the Series 2006-One Allocation Percentage and
(iii) Actual Principal Receivables plus (b) the Special Funding Amount as of the
last day of the related Monthly Period.

“Class A Average Note Principal Balance” shall mean, for any period, the sum of
the Class A Note Principal Balances for each day in such period divided by the
number of days in such period.

“Class A Initial Note Principal Balance” shall mean the amount specified in
Item 3 of Schedule A.

“Class A Monthly Interest” shall have the meaning specified in subsection
4.02(a).

“Class A Note Principal Balance” shall mean, on any date, (a) the Class A
Initial Note Principal Balance, plus (b) the total amount of Class A Note
Principal Balance Increases made on or prior to such date, minus (c) the total
amount of principal payments made on the Class A Notes on or prior to such date.

“Class A Note Principal Balance Increase” shall have the meaning specified in
subsection 4.12(a).

“Class A Note Purchase Agreement” shall mean the Class A Note Purchase Agreement
dated as of March 10, 2006 among CompuCredit Credit Card Master Note Business
Trust III, as Issuer, CompuCredit Funding Corp., as Transferor, CompuCredit
Corporation, as Servicer, the Class A Purchasers party thereto,
“                                ”, as Administrative Agent and Agent, and the
other Agents party thereto.

 

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“Class A Noteholder” shall mean the Person in whose name a Class A Note is
registered in the Note Register.

“Class A Notes” shall mean any one of the Notes executed by the Issuer and
authenticated by or on behalf of the Indenture Trustee, substantially in the
form of Exhibit A.

“Class A Required Amount” shall have the meaning specified in Section 4.04(a).

“Class B Average Note Principal Balance” shall mean, for any period, the sum of
the Class B Note Principal Balances for each day in such period divided by the
number of days in such period.

“Class B Initial Note Principal Balance” shall mean the amount specified in
Item 4 of Schedule A.

“Class B Monthly Interest” shall have the meaning specified in
subsection 4.02(b).

“Class B Note Principal Balance” shall mean, on any date, (a) the Class B
Initial Note Principal Balance, plus (b) the total amount of Class B Note
Principal Balance Increases made on or prior to such date, minus (c) the total
amount of principal payments made on the Class B Notes on or prior to such date.

“Class B Note Principal Balance Increase” shall have the meaning specified in
subsection 4.12(b).

“Class B Note Rate” shall mean, for any Interest Period with respect to the
Class B Notes, a per annum rate of 0%, provided, however, that upon written
notice to the Indenture Trustee and the Servicer, the Class B Note Rate shall
equal such other rate as shall be agreed upon by the Issuer and the Class B
Noteholder, from time to time.

“Class B Noteholder” shall mean the Person in whose name a Class B Note is
registered in the Note Register.

“Class B Notes” shall mean any one of the Notes executed by the Issuer and
authenticated by or on behalf of the Indenture Trustee, substantially in the
form of Exhibit B.

“Closing Date” shall mean March 10, 2006.

“Commitment Termination Date” shall have the meaning provided in the Class A
Note Purchase Agreement.

“Controlled Redemption Period” shall mean, unless an Early Redemption Event with
respect to Series 2006-One shall have occurred prior thereto, the period
commencing on the latest Purchase Termination Date (as defined in the Class A
Note Purchase Agreement) and ending upon the first to occur of (a) the
commencement of the Early Redemption Period, (b) the payment in full to Class A
Noteholders and the Class B Noteholders of the Class A Note Principal Balance
and the Class B Note Principal Balance, respectively, and (c) the Stated
Maturity Date.

 

4

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“Default Rate” shall mean, for any Monthly Period, the annualized percentage
equivalent of a fraction the numerator of which is the Defaulted Amount for such
Monthly Period minus Recoveries for such Monthly Period and the denominator of
which is the Average Principal Receivables for such Monthly Period.

“Delinquency Ratio” shall mean, for any Monthly Period, the ratio (expressed as
a percentage) of (a) the balance of all Receivables as to which, as of the last
day of such Monthly Period, any payment remains unpaid for more than 30 days
from the due date with respect thereto, but excludes Ineligible Receivables, to
(b) the balance of all Receivables (excluding Ineligible Receivables) as of the
last day of such Monthly Period.

“Determination Date” shall mean the third Business Day preceding each
Distribution Date.

“Distribution Date” shall mean the fifteenth day of each calendar month, or if
such fifteenth day is not a Business Day, the next succeeding Business Day;
provided, that the first Distribution Date for Series 2006-One shall be May 15,
2006.

“Early Redemption Event” shall mean any Early Redemption Event specified in
Section 5.01 of the Indenture and any Early Redemption Event specified in
Section 6.01 hereof.

“Early Redemption Period” shall mean the period commencing at the close of
business on the Business Day immediately preceding the day on which an Early
Redemption Event with respect to Series 2006-One is deemed to have occurred, and
ending on the first to occur of (a) the payment in full of the Note Principal
Balance or (b) the Stated Maturity Date.

“Excess Finance Charge Collections” shall have the meaning specified in
Section 4.05 of the Transfer and Servicing Agreement, as further described in
Section 4.08 hereof.

“Excess Spread Percentage” shall mean, with respect to any Monthly Period, the
annualized percentage equivalent of a fraction, (A) the numerator of which is
equal to the product of (a) a fraction the numerator of which is the Class A
Note Principal Balance and the denominator of which is the Note Principal
Balance and (b)(i) Series Finance Charge Collections with respect to such
Monthly Period, plus (ii) without duplication of amounts referred to in clause
(b)(i) above, the amount of Interchange to be included as Series 2006-One
Allocable Finance Charge Collections for such Monthly Period pursuant to
subsection 3.01(b), minus (iii) the Series Default Amount for the Distribution
Date with respect to such Monthly Period, and (B) the denominator of which is
the Class A Average Note Principal Balance with respect to such Monthly Period.

“Facility Limit” shall have the meaning specified in the Class A Note Purchase
Agreement.

“Finance Charge Shortfall” shall have the meaning specified in Section 4.08.

 

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“Fixed/Floating Allocation Percentage” shall mean, with respect to any day
during a 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 Series Adjusted Allocation Amount for Series 2006-One as of the last
day of the immediately preceding Monthly Period (or, in the case of the first
Monthly Period, the Initial Note Principal Balance) and (b) during the
Redemption Period or Limited Redemption Period, the Series Adjusted Allocation
Amount for Series 2006-One as of the close of business on the date on which the
Revolving Period shall have terminated or been suspended, as the case may be,
and the denominator of which is the product of (x) the greater of (A) the sum of
(i) the total amount of Principal Receivables as of the last day of the
immediately preceding Monthly Period (or with respect to the first Monthly
Period, the total amount of Principal Receivables as of the Closing Date),
(ii) the Special Funding Amount as of such last day (or with respect to the
first Monthly Period, the Closing Date) and (iii) the amount of Collections of
Principal Receivables on deposit in the Collection Account as of such last day
(or with respect to the first Monthly Period, as of the Closing Date) and
(B) the sum of the numerators used to determine the series allocation
percentages with respect to Collections of Principal Receivables for all Series
of Notes Outstanding, and (y) the Series 2006-One Allocation Percentage as of
the last day of the immediately preceding Monthly Period; provided, however,
that with respect to any Monthly Period in which one or more Reset Dates occurs,
the Fixed/Floating Allocation Percentage shall be recalculated as provided above
but as of such Reset Date for the period from and including such Reset Date to
but excluding the next such Reset Date, if any, or if no other Reset Date occurs
during such Monthly Period, to and including the last day of such Monthly
Period, as applicable.

“Floating Allocation Percentage” shall mean, with respect to any day during a
Monthly Period, the percentage equivalent (which percentage shall never exceed
100%) of a fraction, the numerator of which is the Allocation Amount as of the
last day of the preceding Monthly Period (or in the case of the first Monthly
Period, the Initial Note Principal Balance) and the denominator of which is the
product of (x) the Series 2006-One Allocation Percentage with respect to such
Monthly Period and (y) the greater of (A) the sum of (i) the total amount of
Principal Receivables as of such day (or with respect to the first Monthly
Period, the total amount of Principal Receivables on the Closing Date), (ii) the
Special Funding Amount as of such last day (or with respect to the first Monthly
Period, the Closing Date) and (iii) the amount of Collections of Principal
Receivables on deposit in the Collection Account as of such last day (or with
respect to the first Monthly Period, as of the Closing Date) and (B) the sum of
the numerators used to determine the series allocation percentages with respect
to Collections of Finance Charge Receivables for all Series of Notes
Outstanding; provided, however, that with respect to any Monthly Period in which
one or more Reset Dates occurs, the Floating Allocation Percentage shall be
recalculated as provided above but as of such Reset Date, for the period from
and after the date on which any such Reset Date occurs to but excluding the
date, if any, that another such Reset Date occurs or, if no other Reset Date
occurs during such Monthly Period, to and including the last day of such Monthly
Period, as applicable.

“Group I” shall mean Series 2006-One and each other Series specified in the
related Supplement to be included in Group I.

 

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“Group I Series Additional Amounts” shall mean, with respect to any Monthly
Period, the sum of (a) Series 2006-One Additional Amounts for such Distribution
Date and (b) for all other Series included in Group I, the sum of (i) the
aggregate net amount by which the allocation amounts of such Series have been
reduced as a result of reduction amounts, subordination of principal collections
and, if applicable, funding the series default amounts in respect of any Class
of Notes or Series Enhancement of such Series as of such Distribution Date and
(ii) if the applicable Supplements so provide, the aggregate unpaid amount of
interest at the applicable note interest rates that has accrued on the amounts
described in the preceding clause (i) for such Distribution Date.

“Group I Series Default Amount” shall mean, with respect to any Distribution
Date, the sum of (a) the Series Default Amount for such Distribution Date and
(b) the aggregate amount of the series default amounts for all other Series
included in Group I for such Distribution Date.

“Group I Series Finance Charge Collections” shall mean, with respect to any
Distribution Date, the sum of (a) Series Finance Charge Collections for such
Distribution Date and (b) the aggregate amount of the series finance charge
collections for all other Series included in Group I for such Distribution Date.

“Group I Series Monthly Fees” shall mean, with respect to any Distribution Date,
the sum of (a) Series 2006-One Monthly Fees for such Distribution Date and
(b) the aggregate amount of the servicing fees, series fees, fees payable to any
Series Enhancer and any other similar fees, which are payable out of reallocated
series finance charge collections pursuant to the related Supplements, for all
other Series included in Group I for such Distribution Date.

“Group I Series Monthly Interest” shall mean, with respect to any Distribution
Date, the sum of (a) Series 2006-One Monthly Interest for such Distribution Date
and (b) the aggregate amount of monthly interest, including overdue monthly
interest and interest on such overdue monthly interest, if such amounts are
payable out of reallocated series finance charge collections pursuant to the
related Supplements, for all other Series included in Group I for such
Distribution Date.

“Initial Note Principal Balance” shall mean the sum of (a) the Class A Initial
Note Principal Balance and (b) the Class B Initial Note Principal Balance.

“Interest Period” shall mean, with respect to any Distribution Date, the period
from and including the Distribution Date immediately preceding such Distribution
Date (or, in the case of the first Distribution Date, from and including the
Closing Date) to but excluding such Distribution Date.

“Investment Letter” shall have the meaning specified in subsection 9.04(c).

“Limited Redemption Amount” shall mean for any Distribution Date relating to a
Limited Redemption Period, the excess, if any, of (i) the initial amount
specified in the notice delivered by the Issuer in accordance with
Section 4.03(a) over (ii) the aggregate amount of principal paid on the Class A
Notes on all prior Distribution Dates, if any, in such Limited Redemption
Period.

 

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“Limited Redemption Period” shall mean, unless the Controlled Redemption Period
or the Early Redemption Period shall have commenced prior thereto, a period
beginning on the first day of the Monthly Period specified in the notice
delivered by the Issuer in accordance with Section 4.03(a), and ending upon the
first to occur of (i) the commencement of the Controlled Redemption Period or
the Early Redemption Period and (ii) the last day of the Monthly Period related
to the Distribution Date on which the aggregate amount distributed pursuant to
Section 4.05(c)(i) equals the Limited Redemption Amount for such Distribution
Date.

“Monthly Interest” shall mean, with respect to any Distribution Date, the
Class A Monthly Interest and the Class B Monthly Interest for such Distribution
Date.

“Monthly Principal Payment Rate” shall mean, with respect to any Monthly Period,
a fraction, the numerator of which is the total amount of Collections of
Principal Receivables for such Monthly Period and the denominator of which is
the total amount of Principal Receivables as of the first day of such Monthly
Period.

“Monthly Servicing Fee” shall have the meaning specified in subsection 3.01(a).

“Monthly Supplemental Servicing Fee” shall have the meaning specified in
subsection 3.01(b).

“Note Assignment” shall have the meaning specified in subsection 9.04(e).

“Note Principal Balance” shall mean, for any date of determination, the sum of
the Class A Note Principal Balance and the Class B Note Principal Balance.

“Note Principal Balance Increase” shall mean a Class A Note Principal Balance
Increase or a Class B Note Principal Balance Increase, as applicable.

“Optional Redemption Amount” shall have the meaning specified in Section 4.03.

“Optional Redemption Date” shall have the meaning specified in Section 4.03.

“Optional Redemption Notice” shall have the meaning specified in Section 4.03.

“Participant” shall have the meaning specified in subsection 9.04(f).

“Private Holder” shall mean each holder of a right to receive interest or
principal in respect of any direct or indirect interest in the Issuer, including
any financial instrument or contract the value of which is determined in whole
or in part by reference to the Issuer (including the assets of the Issuer,
income of the Issuer or distributions made by the Issuer), but excluding any
interest in the Issuer represented by any Series or Class of Notes or any other
interest as to which the Transferor has provided to the Indenture Trustee an
Opinion of Counsel to the effect that such Series, Class or other interest will
be treated as debt or otherwise not as an equity interest in either the Issuer
or the Receivables for federal income tax purposes, in each case, provided such
interest is not convertible or exchangeable into an interest in the Issuer or
the Issuer’s income or equivalent value. Notwithstanding the immediately
preceding sentence, (i)

 

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“Private Holder” shall also include any other Person that the Transferor
determines is, may be or may become a “partner” within the meaning of
Section 1.7704-1(h)(1)(ii) (including by reason of Section 1.7704-1(h)(3)) of
the United States Treasury Regulations. “Private Holders” shall include the
Holders of the Trust Certificate, the Transferor Certificates or any interest in
either, the Servicer and the Series 2006-One Noteholders. Any person holding
more than one interest in the Issuer each of which separately would cause such
Person to be a Private Holder shall be treated as a single Private Holder. Each
holder of an interest in a Private Holder which is a partnership, S corporation
or a grantor trust under the Code shall be treated as a Private Holder unless
excepted with the consent of the Transferor (which consent shall be based on an
Opinion of Counsel generally to the effect that the action taken pursuant to the
consent will not cause the Issuer to become a publicly traded partnership
treated as a corporation).

“Reallocated Principal Collections” shall mean, with respect to any Distribution
Date, an amount equal to the lesser of (I) the product of (a) the Series
2006-One Allocable Principal Collections related to Principal Receivables
deposited in the Collection Account for the related Monthly Period and (b) the
Fixed/Floating Allocation Percentage for the related Monthly Period, and (II)
the greater of (x) the Class B Note Principal Balance minus the excess, if any,
of the total amount of Reduction Amounts for all prior Distribution Dates and
Reallocated Principal Collections that under Section 4.07 were used to fund the
Class A Required Amount on all prior Distribution Dates over such Reduction
Amounts and Reallocated Principal Collections reimbursed pursuant to subsection
4.05(a)(iv) prior to such date and (y) 0.

“Reallocated Series Finance Charge Collections” shall mean that portion of
Group I Series Finance Charge Collections allocated to Series 2006-One pursuant
to Section 4.09.

“Redemption Amount” shall mean, with respect to any Distribution Date, after
giving effect to any deposits and distributions otherwise to be made on such
Distribution Date, the sum of (a) the Class A Note Principal Balance plus
(b) Series 2006-One Monthly Interest for such Distribution Date plus (c) any
Series 2006-One Additional Amounts for such Distribution Date plus (d) any
Series 2006-One Monthly Fees for such Distribution Date plus (e) the Class B
Note Principal Balance and any interest accrued thereon.

“Redemption Period” shall mean, with respect to Series 2006-One, the Controlled
Redemption Period or the Early Redemption Period (or both), as the context
requires and, for purposes of Shared Principal Collections, any Limited
Redemption Period and any period commencing on the date of an Optional
Redemption Notice and ending on the related Optional Redemption Date.

“Reduction Amount” shall have the meaning specified in Section 4.06.

“Required Subordinate Amount” shall mean, for any date of determination, with
respect to the Class B Notes, an amount equal to the product of (i) the
percentage set forth in Item 5 of Schedule A and (ii) the Note Principal Balance
on such date of determination, determined after giving effect to all increases
in the principal balance of, or all payments of principal, if any, with respect
to the Series 2006-One Notes on such date of determination.

 

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“Required Spread Account Amount” shall mean, on any date of determination, the
product of (a) the Class A Note Principal Balance as of such date of
determination and (b) the Spread Account Cap Percentage as of such date of
determination.

“Reset Date” shall mean each of (a) an Addition Date, (b) a date on which a Note
Principal Balance Increase occurs, (c) the date of any increase or decrease
(other than regularly scheduled redemptions or early redemptions but including
any optional redemption or limited redemption in the principal balance of the
Notes of any Series) in the note principal balance or allocation amount for
another variable funding Series, (d) any date on which a new Series is issued,
and (e) an Optional Redemption Date.

“Revolving Period” shall mean the period beginning at the close of business on
the Closing Date and ending on the earlier of (a) the close of business on the
day immediately preceding the day the Controlled Redemption Period commences and
(b) the close of business on the day immediately preceding the day the Early
Redemption Period commences; provided, however, that the Revolving Period shall
be temporarily suspended for the duration of any Limited Redemption Period.

“Series 2006-One” shall mean the Series of Notes the terms of which are
specified in this Supplement.

“Series 2006-One Additional Amounts” shall mean, with respect to any
Distribution Date, the amount determined pursuant to subsection 4.05(a)(v) for
such Distribution Date.

“Series 2006-One Allocable Defaulted Amount” shall mean the Series Allocable
Defaulted Amount with respect to Series 2006-One.

“Series 2006-One Allocable Finance Charge Collections” shall mean the Series
Allocable Finance Charge Collections with respect to Series 2006-One.

“Series 2006-One Allocable Principal Collections” shall mean the Series
Allocable Principal Collections with respect to Series 2006-One.

“Series 2006-One Allocation Percentage” shall mean the Series Allocation
Percentage with respect to Series 2006-One, which shall be an amount equal to,
with respect to any Monthly Period, the percentage equivalent of a fraction, the
numerator of which is the Series Adjusted Allocation Amount for Series 2006-One
as of the last day of the immediately preceding Monthly Period plus the Series
Required Transferor Amount as of such last day and the denominator of which is
the Trust Adjusted Allocation Amount plus the Series Required Transferor Amount
as of such last day; provided, however, that with respect to any Monthly Period
in which one or more Reset Dates occurs, the Series 2006-One Allocation
Percentage shall be recalculated as provided above but as of such Reset Date for
the period from and after the date on which any such Reset Date occurs to but
excluding the date, if any, that another such Reset Date occurs or, if no other
Reset Date occurs during such Monthly Period, to and including the last day of
such Monthly Period.

 

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“Series 2006-One Distribution Account” shall have the meaning set forth in
subsection 4.13(a).

“Series 2006-One Monthly Fees” shall mean, with respect to any Distribution
Date, the amount determined pursuant to subsection 4.05(a)(i) and subsection
4.05(a)(vi)

“Series 2006-One Monthly Interest” shall mean the amounts determined pursuant to
subsection 4.02(a) and subsection 4.02(b).

“Series 2006-One Note” shall mean a Class A Note or a Class B Note.

“Series 2006-One Noteholder” shall mean a Class A Noteholder or a Class B
Noteholder.

“Series 2006-One Principal Shortfall” shall have the meaning specified in
Section 4.10.

“Series Allocation Amount” shall mean, for Series 2006-One, with respect to any
date of determination (a) during the Revolving Period or Limited Redemption
Period, the Note Principal Balance as of such date of determination, and
(b) during a Redemption Period, the Note Principal Balance as of the close of
business on the last day of the Revolving Period.

“Series Default Amount” shall mean, with respect to any Monthly Period, an
amount equal to the product of (a) the Series 2006-One Allocable Defaulted
Amount for the related Monthly Period and (b) the Floating Allocation Percentage
for such Monthly Period.

“Series Finance Charge Collections” shall mean, with respect to any Distribution
Date, an amount equal to the product of (a) the Floating Allocation Percentage
for the related Monthly Period and (b) the Series 2006-One Allocable Finance
Charge Collections deposited in the Collection Account for the related Monthly
Period.

“Series Required Transferor Amount” shall mean an amount equal to 0% of the
Allocation Amount.

“Servicing Base Amount” shall have the meaning specified in subsection 3.01(a).

“Servicing Fee Rate” shall mean the percentage set forth in Item 6 of Schedule
A.

“Special Payment Date” shall mean each Distribution Date with respect to any
Redemption Period.

“Spread Account” shall have the meaning specified in subsection 4.11(a).

“Spread Account Cap Percentage” shall mean, for any Distribution Date, zero
unless on such Distribution Date (i) the Excess Spread Percentage for the
related Monthly Period is greater than or equal to the percentage set forth in
the left-hand column of the table below, and less than the percentage set forth
in the second from left column of the table below, or (ii) the Average Principal
Payment Rate for the three consecutive Monthly Periods immediately

 

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preceding such date is greater than or equal to the percentage set forth in the
third from the left column of the table below, and less than the percentage set
forth in the fourth from left column of the table below, in which case, the
Spread Account Cap Percentage shall be the percentage set forth next to such
percentages in the right-hand column of the table below:

 

Excess Spread
Percentage

  Average Principal
Payment Rate    

Greater
Than
or Equal to

  Less
Than   Greater
Than
or Equal to   Less
Than   Spread
Account
Cap %

9.5%

  10.0%   5.75%   6.0%   2.5%

9.0%

  9.5%   5.5%   5.75%   5.0%

8.5%

  9.0%   5.25%   5.5%   7.5%

8.0%

  8.5%   5%   5.25%   10.0%

provided, however, that the Spread Account Cap Percentage with respect to any
Distribution Date may only be reduced by a single step increment from the Spread
Account Cap Percentage applicable to the immediately preceding Distribution
Date.

“Spread Account Draw Amount” shall have the meaning specified in
subsection 4.11(c).

“Spread Account Surplus” shall mean, as of any date of determination, the
amount, if any, by which the amount on deposit in the Spread Account exceeds the
Required Spread Account Amount.

“Stated Maturity Date” shall mean the twelfth month following the latest
Purchase Termination Date (as defined in the Class A Note Purchase Agreement).

“Tangible Net Worth” shall mean, with respect to any Person, the net worth of
such Person calculated in accordance with GAAP after subtracting therefrom the
aggregate amount of such Person’s intangible assets, including, without
limitation, goodwill, franchises, licenses, patents, trademarks, tradenames,
copyrights and service marks.

“Supplemental Servicing Fee Rate” shall mean the percentage set forth in Item 7
of Schedule A.

“Transferor Percentage” shall mean 100% minus (a) the Floating Allocation
Percentage, when used at any time with respect to Defaulted Receivables, (b) the
Floating Allocation Percentage, when used during a Monthly Period in the
Revolving Period, Limited Redemption Period or the Controlled Redemption Period
with respect to Collections of Finance Charge Receivables, (c) the
Fixed/Floating Allocation Percentage, when used during a Monthly Period in the
Early Redemption Period with respect to Collections of Finance Charge
Receivables, and (d) the Fixed/Floating Allocation Percentage, when used at any
time with respect to Collections of Principal Receivables.

 

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(b) The words “hereof,” “herein” and “hereunder” and words of similar import
when used in this Supplement shall refer to this Supplement as a whole and not
to any particular provision of this Supplement; references to any Article,
subsection, Section or Exhibit are references to Articles, subsections, Sections
and Exhibits in or to this Supplement unless otherwise specified; and the term
“including” means “including without limitation.”

ARTICLE III

Servicing Fee and Interchange

Section 3.01. Servicing Compensation; Interchange.

(a) Servicing Fee. The share of the Servicing Fee allocable to the Series
2006-One Noteholders with respect to any Distribution Date (the “Monthly
Servicing Fee”) shall be equal to one-twelfth of the product of (a) the
Servicing Fee Rate and (b) (i) the Average Allocation Amount for the Monthly
Period preceding such Distribution Date, minus (ii) the product of the amount,
if any, on deposit in the Special Funding Account as of the last day of the
Monthly Period preceding such Distribution Date and the Series 2006-One
Allocation Percentage with respect to such Monthly Period (the amount calculated
pursuant to this clause (b) is referred to as the “Servicing Base Amount”). The
remainder of the Servicing Fee shall be paid by the Issuer and the Noteholders
of other Series (as provided in the Transfer and Servicing Agreement and the
related Supplements) and in no event shall the Indenture Trustee or the Series
2006-One Noteholders be liable for the share of the Servicing Fee to be paid by
the Issuer or the Noteholders of any other Series.

(b) Supplemental Servicing Fee. In addition to the Monthly Servicing Fee, there
shall also be allocated to the Series 2006-One Noteholders a monthly
supplemental servicing fee (the “Monthly Supplemental Servicing Fee”), which
shall be equal to one-twelfth of the product of (1) the Supplemental Servicing
Fee Rate and (2) the Servicing Base Amount.

(c) Interchange. On or before each Determination Date, the Servicer shall notify
in writing the Indenture Trustee and the Transferor of the amount of Interchange
to be included as Series 2006-One Allocable Finance Charge Collections with
respect to the preceding Monthly Period as determined pursuant to this
subsection 3.01(c). Such amount of Interchange shall be equal to the product of
(i) the amount of Interchange attributable to the Accounts, as determined by the
Servicer for the preceding Monthly Period, and (ii) the Series 2006-One
Allocation Percentage for the preceding Monthly Period. On each Transfer Date,
pursuant to the Transfer and Servicing Agreement, the Transferor shall pay to
the Servicer, and the Servicer shall deposit into the Collection Account, in
same day funds, the amount of Interchange to be so included as Series 2006-One
Allocable Finance Charge Collections with respect to the preceding Monthly
Period and such Interchange shall be treated as a portion of Series 2006-One
Allocable Finance Charge Collections for all purposes of this Supplement and the
Indenture.

 

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ARTICLE IV

Rights of Series 2006-One Noteholders and

Allocation and Application of Collections

Section 4.01. Collections and Allocations.

(a) Allocations. Collections of Finance Charge Receivables and Principal
Receivables and Defaulted Receivables allocated to Series 2006-One pursuant to
Section 4.01 of the Transfer and Servicing Agreement (and, as described herein,
Collections of Finance Charge Receivables reallocated from other Series in Group
I) shall be allocated and distributed or reallocated as set forth in this
Article.

(b) Payments to the Issuer. The Servicer shall instruct the Indenture Trustee,
on any Business Day requested by the Issuer, to withdraw from the Collection
Account and pay to the Issuer for application as provided in the Trust Agreement
the following amounts:

(i) an amount equal to the Transferor Percentage for the related Monthly Period
of Series 2006-One Allocable Finance Charge Collections deposited in the
Collection Account; provided, however, that if on such date the Available Spread
Account Amount is less than the Required Spread Account Amount (after giving
effect to any deposits into the Spread Account on such date pursuant to
subsections 4.01(c)(ii)(w) or (x) and 4.05(a)(viii)), then such amount shall be
deposited on such date into the Spread Account to the extent of such deficiency;
and

(ii) an amount equal to the Transferor Percentage for the related Monthly Period
of Series 2006-One Allocable Principal Collections deposited in the Collection
Account, if the Transferor Amount (determined after giving effect to any
Principal Receivables transferred to the Issuer on such date) exceeds the
Required Transferor Amount; provided, however, that if on such date the
Available Spread Account Amount is less than the Required Spread Account Amount
(after giving effect to any deposits into the Spread Account on such date
pursuant to subsections 4.01(b)(i), 4.01(c)(ii)(w) or (x) and 4.05(a)(viii)),
then such amount shall be deposited on such date into the Spread Account to the
extent of such deficiency.

The withdrawals to be made from the Collection Account pursuant to this
subsection 4.01(b) do not apply to deposits into the Collection Account that do
not represent Collections, including payment for the reassignment of the
Receivables and Participation Interests pursuant to Section 2.06 of the Transfer
and Servicing Agreement, payment of the purchase price for the Series 2006-One
Notes pursuant to Section 8.01 of the Transfer and Servicing Agreement, payment
of the redemption price for the Series 2006-One Notes pursuant to Section 7.01
and proceeds from the sale, disposition or liquidation of Receivables pursuant
to Section 5.05 of the Indenture.

(c) Allocations to the Series 2006-One Noteholders. The Servicer shall, prior to
the close of business on any Deposit Date, allocate to the Series 2006-One
Noteholders the following amounts as set forth below:

(i) Allocations of Finance Charge Collections. The Servicer shall allocate to
the Series 2006-One Noteholders the following amounts as set forth below:

 

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(x) Allocations During the Revolving Period, Limited Redemption Period and the
Controlled Redemption Period. During the Revolving Period, Limited Redemption
Period and the Controlled Redemption Period, the Servicer shall allocate to the
Series 2006-One Noteholders and retain in the Collection Account for application
as provided herein an amount equal to the product of (A) the Floating Allocation
Percentage and (B) the Series 2006-One Allocation Percentage and (C) the
aggregate amount of Collections of Finance Charge Receivables deposited in the
Collection Account on such Deposit Date; provided, however, that after the date
on which an amount of such Collections of Finance Charge Receivables equal to
the sum of the amounts specified in subsections 4.05(a)(i) through (ix) have
been deposited into the Collection Account and allocated to the Series 2006-One
Noteholders (and, with respect to the amount specified in subsection
4.05(a)(viii), deposited into the Spread Account), such amount shall be paid to
the Issuer for application pursuant to the Trust Agreement.

(y) Allocations During the Early Redemption Period. During the Early Redemption
Period, the Servicer shall allocate to the Series 2006-One Noteholders and
retain in the Collection Account for application as provided herein an amount
equal to the product of (A) the Fixed/Floating Allocation Percentage and (B) the
Series 2006-One Allocation Percentage and (C) the aggregate amount of
Collections of Finance Charge Receivables deposited in the Collection Account on
such Deposit Date; provided, however, that after the date on which an amount of
such Collections of Finance Charge Receivables equal to the sum of the amounts
specified in subsections 4.05(a)(i) through (ix) have been deposited into the
Collection Account and allocated to the Series 2006-One Noteholders (and, with
respect to the amount specified in subsection 4.05(a)(viii), deposited into the
Spread Account), such amount shall be paid to the Issuer for application
pursuant to the Trust Agreement.

(ii) Allocations of Principal Collections. The Servicer shall allocate to the
Series 2006-One Noteholders the following amounts as set forth below:

(w) Allocations During the Limited Redemption Period. During the Limited
Redemption Period, (A) an amount equal to the product of (I) the Aggregate
Subordination Percentage for the immediately preceding Monthly Period and (II)
the Fixed/Floating Allocation Percentage and (III) the Series 2006-One
Allocation Percentage and (IV) the aggregate amount of Collections of Principal
Receivables deposited in the Collection Account on such Deposit Date, shall be
allocated to the Series 2006-One Noteholders and retained in the Collection
Account until applied as provided herein; provided, however, that any such
amount may be withdrawn from the Collection Account by the Indenture Trustee at
the written direction of the Servicer and paid to the Issuer for application
pursuant to the Trust Agreement on any Business Day requested by the Issuer, but
only if (i) the Transferor Amount on such date is greater than the Required
Transferor Amount (after giving effect to all Principal Receivables transferred
to the Issuer on such day) and (ii) the Available Spread Account Amount is equal
to or greater than the Required Spread Account Amount (after giving effect to
any deposits into the Spread Account on such Deposit Date pursuant to subsection
4.05(a)(viii)) and (B) an amount equal to the product of (I) 100 minus the
Aggregate Subordination Percentage for the immediately preceding Monthly Period
and (II) the Fixed/Floating Allocation

 

15

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Percentage and (III) the Series 2006-One Allocation Percentage and (IV) the
aggregate amount of Collections of Principal Receivables deposited in the
Collection Account on such Deposit Date, shall be allocated to the Series
2006-One Noteholders and retained in the Collection Account until applied as
provided herein; provided, however, that, with respect to clause (B) above,
after the date on which an amount of such Collections equal to the Limited
Redemption Amount has been deposited into the Collection Account and allocated
to the Series 2006-One Noteholders, such amount shall be first, if on such
Deposit Date the Available Spread Account Amount is less than the Required
Spread Account Amount (after giving effect to any deposits into the Spread
Account on such Deposit Date pursuant to subsection 4.05(a)(viii)), deposited
into the Spread Account in the amount of such shortfall, second, if any other
Principal Sharing Series is outstanding and in its redemption period or
accumulation period, retained in the Collection Account for application, to the
extent necessary, as Shared Principal Collections on the related Distribution
Date, and third paid to the Issuer for application pursuant to the Trust
Agreement only if the Transferor Amount on such Deposit Date is greater than the
Required Transferor Amount (after giving effect to all Principal Receivables
transferred to the Issuer on such day) and otherwise shall be deposited in the
Special Funding Account.

(x) Allocations During the Revolving Period. During the Revolving Period (A) an
amount equal to the product of (I) the Aggregate Subordination Percentage for
the immediately preceding Monthly Period and (II) the Fixed/Floating Allocation
Percentage and (III) the Series 2006-One Allocation Percentage and (IV) the
aggregate amount of Collections of Principal Receivables deposited in the
Collection Account on such Deposit Date, shall be allocated to the Series
2006-One Noteholders and retained in the Collection Account until applied as
provided herein; provided, however, that any such amount may be withdrawn from
the Collection Account and paid to the Issuer for application pursuant to the
Trust Agreement on any Business Day requested by the Issuer, but only if (i) the
Transferor Amount on such date is greater than the Required Transferor Amount
(after giving effect to all Principal Receivables transferred to the Issuer on
such day) and (ii) the Available Spread Account Amount is equal to or greater
than the Required Spread Account Amount (after giving effect to any deposits
into the Spread Account on such Deposit Date pursuant to subsection
4.05(a)(viii)) and (B) an amount equal to the product of (I) 100% minus the
Aggregate Subordination Percentage for the immediately preceding Monthly Period
and (II) the Fixed/Floating Allocation Percentage and (III) the Series 2006-One
Allocation Percentage and (IV) the aggregate amount of Collections of Principal
Receivables deposited in the Collection Account on such Deposit Date shall, if
such Deposit Date is after an Optional Redemption Notice has been given but
prior to the related Optional Redemption Date, be allocated to the Series
2006-One Noteholders and retained in the Collection Account until applied as
provided herein; provided, however, that, with respect to clause (B) above, if
the sum of such amount and all such preceding amounts since the date the
Optional Redemption Notice was given exceeds the Optional Redemption Amount
(less (x) any amounts which the Servicer has notified the Indenture Trustee in
writing will be available to pay the Optional Redemption Amount from the
proceeds of the issuance of one or more new Series of Notes and (y) any amounts
available in the Special Funding Account to pay such Optional Redemption
Amount), or if no Optional Redemption Notice has been given or the needed amount
has been

 

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allocated, then such excess shall be first, if on such Deposit Date the
Available Spread Account Amount is less than the Required Spread Account Amount
(after giving effect to any deposits into the Spread Account on such Deposit
Date pursuant to subsection 4.05(a)(viii)), deposited into the Spread Account in
the amount of such shortfall, second, if any other Principal Sharing Series is
outstanding and in its redemption period or accumulation period, retained in the
Collection Account for application, to the extent necessary, as Shared Principal
Collections on the related Distribution Date, and third, paid to the Issuer for
application pursuant to the Trust Agreement on each Distribution Date; provided,
however, that any such amount to be paid to the Issuer shall be paid to the
Issuer only if the Transferor Amount on such date is greater than the Required
Transferor Amount (after giving effect to all Principal Receivables transferred
to the Issuer on such day) and otherwise shall be deposited in the Special
Funding Account.

(y) Allocations During the Controlled Redemption Period. During the Controlled
Redemption Period, an amount equal to the product of (I) the Fixed/Floating
Allocation Percentage and (II) the Series 2006-One Allocation Percentage and
(III) the aggregate amount of Collections of Principal Receivables deposited in
the Collection Account on such Deposit Date, shall be allocated to the Series
2006-One Noteholders and retained in the Collection Account until applied as
provided herein; provided, however, that after the date on which an amount of
such Collections equal to the Note Principal Balance has been deposited into the
Collection Account and allocated to the Series 2006-One Noteholders, such amount
shall be first, if any other Principal Sharing Series is outstanding and in its
redemption period or accumulation period, retained in the Collection Account for
application, to the extent necessary, as Shared Principal Collections on the
related Distribution Date, and second paid to the Issuer for application
pursuant to the Trust Agreement on each Distribution Date; provided, however,
that any such amount to be paid to the Issuer shall be paid to the Issuer only
if the Transferor Amount on such date is greater than the Required Transferor
Amount (after giving effect to all Principal Receivables transferred to the
Issuer on such day) and otherwise shall be deposited in the Special Funding
Account.

(z) Allocations During the Early Redemption Period. During the Early Redemption
Period, an amount equal to the product of (I) the Fixed/Floating Allocation
Percentage and (II) the Series 2006-One Allocation Percentage and (III) the
aggregate amount of Collections of Principal Receivables deposited in the
Collection Account on such Deposit Date, shall be allocated to the Series
2006-One Noteholders and retained in the Collection Account until applied as
provided herein; provided, however, that after the date on which an amount of
such Collections equal to the Note Principal Balance has been deposited into the
Collection Account and allocated to the Series 2006-One Noteholders, such amount
shall be first, if any other Principal Sharing Series is outstanding and in its
redemption period or accumulation period, retained in the Collection Account for
application, to the extent necessary, as Shared Principal Collections on the
related Distribution Date, and second paid to the Issuer for application
pursuant to the Trust Agreement on each Distribution Date; provided, however,
that any such amount to be paid to the Issuer shall be paid to the Issuer only
if the Transferor Amount on such date is greater than the Required Transferor
Amount (after giving effect to all Principal Receivables transferred to the
Issuer on such day) and otherwise shall be deposited in the Special Funding
Account.

 

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Section 4.02. Determination of Monthly Interest.

(a) The amount of monthly interest (“Class A Monthly Interest”) distributable
from the Collection Account with respect to the Class A Notes on any
Distribution Date shall be an amount determined as provided in the Class A Note
Purchase Agreement.

(b) The amount of monthly interest (“Class B Monthly Interest”) distributable
from the Collection Account with respect to the Class B Notes on any
Distribution Date shall be an amount equal to the product of (i) (A) a fraction,
the numerator of which is the actual number of days in the immediately preceding
Interest Period and the denominator of which is 360, times (B) the Class B Note
Rate and (ii) the Class B Average Note Principal Balance with respect to the
related Interest Period.

Section 4.03. Limited Redemption; Optional Redemption.

(a) The Issuer may from time to time at its sole discretion, unless an Early
Redemption Event shall have occurred prior thereto, suspend the Revolving Period
and cause a Limited Redemption Period to commence for one or more Monthly
Periods by delivering to the Servicer, the Indenture Trustee and the
Administrative Agent written notice at least two Business Days prior to the
first day of the Monthly Period in which such Limited Redemption Period is
scheduled to commence, which notice shall specify the initial Limited Redemption
Amount for such Limited Redemption Period; provided, however, that any such
initial Limited Redemption Amount shall be in a minimum amount of $1,000,000;
provided further that the Issuer may not cause a Limited Redemption Period to
commence unless, in the reasonable belief of the Issuer, such Limited Redemption
Period would not result in the occurrence of an Early Redemption Event.

(b) On any Business Day during the Revolving Period, the Issuer may cause the
Servicer to provide written notice to the Indenture Trustee, the Administrative
Agent and the Series 2006-One Noteholders (an “Optional Redemption Notice”) at
least two Business Days prior to any Business Day (the “Optional Redemption
Date”) stating its intention to cause a full redemption of the Series 2006-One
Notes on the Optional Redemption Date in an amount (the “Optional Redemption
Amount”) of (w) with respect to the Class A Notes, an amount equal to the
Class A Note Principal Balance (plus accrued interest, if any) on such Optional
Redemption Date and (x) with respect to the Class B Notes, an amount equal to
the Class B Note Principal Balance (plus accrued interest, if any) on such
Optional Redemption Date. The Optional Redemption Notice shall state the
Optional Redemption Date and the Optional Redemption Amount. The Optional
Redemption Amount shall be paid from any Available Principal Collections on
deposit in the Collection Account, from funds on deposit in the Special Funding
Account (but only to the extent withdrawals from the Special Funding Account
will not cause the Transferor Amount to be less than the Required Transferor
Amount after giving effect to such withdrawal), from the proceeds of the
issuance of one or more new Series of Notes issued substantially
contemporaneously with such full redemption, or from any other monies available
to the Issuer or the Transferor (or any combination of the above). On the
Optional Redemption

 

18

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Date the Servicer shall pay (x) the Optional Redemption Amount with respect to
the Class A Notes to the Administrative Agent for the benefit of the Class A
Noteholders, and (y) the Optional Redemption Amount with respect to the Class B
Notes to the Class B Noteholders.

Section 4.04. Class A Required Amount.

(a) With respect to each Distribution Date, on the related Determination Date,
the Servicer shall determine the amount (the “Class A Required Amount”), if any,
by which (x) the amount required pursuant to subsections 4.05(a)(ii) and
4.05(a)(v) for such Distribution Date exceeds (y) the Available Funds for such
Distribution Date available to fund such amount. In the event that the Class A
Required Amount for such Distribution Date is greater than zero, the Servicer
shall give written notice to the Indenture Trustee of such Class A Required
Amount on the date of computation.

Section 4.05. Application of Available Funds and Available Principal
Collections. The Servicer shall apply, or shall cause the Indenture Trustee to
apply by written instruction to the Indenture Trustee, on each Distribution
Date, Available Funds and Available Principal Collections on deposit in the
Collection Account with respect to such Distribution Date to make the following
distributions:

(a) On each Distribution Date, an amount equal to the Available Funds with
respect to such Distribution Date will be distributed in the following priority:

(i) an amount equal to the Monthly Servicing Fee for such Distribution Date,
plus the amount of any Monthly Servicing Fee previously due but not distributed
to the Servicer on a prior Distribution Date, shall be distributed to the
Servicer;

(ii) an amount equal to Class A Monthly Interest for such Distribution Date
shall be distributed to the Paying Agent for distribution to the Class A
Noteholders;

(iii) an amount equal to the Series Default Amount for such Distribution Date
shall be treated as a portion of Available Principal Collections for such
Distribution Date;

(iv) an amount equal to the aggregate amount of Reduction Amounts and
Reallocated Principal Collections that under Section 4.07 were used to fund the
Class A Required Amount which have not been previously reimbursed shall be
treated as a portion of Available Principal Collections for such Distribution
Date;

(v) any other amounts (other than principal payments on the Class A Notes or
Class A Monthly Interest) due and owing on such Distribution Date pursuant to
the Class A Note Purchase Agreement shall be distributed to the Paying Agent for
distribution to the Class A Noteholders;

(vi) an amount equal to the Monthly Supplemental Servicing Fee for such
Distribution Date, plus the amount of any Monthly Supplemental Servicing Fee
previously due but not distributed to the Servicer on a prior Distribution Date,
shall be distributed to the Servicer;

 

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(vii) if an Event of Default and acceleration of the maturity of the Series
2006-One Notes pursuant to Section 5.03 of the Indenture has occurred on or
prior to such Distribution Date, an amount up to the Class A Note Principal
Balance on such Distribution Date shall be treated as a portion of Available
Principal Collections for such Distribution Date;

(viii) on each Distribution Date prior to the date on which the Spread Account
terminates pursuant to subsection 4.11(e), an amount up to the excess, if any,
of the Required Spread Account Amount for such Distribution Date over the
Available Spread Account Amount for such Distribution Date shall be deposited
into the Spread Account;

(ix) 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
distributed to Class B Noteholders on a prior Distribution Date, shall be
distributed to the Paying Agent for payment to the Class B Noteholders; and

(x) the balance, if any, will constitute a portion of Excess Finance Charge
Collections for such Distribution Date and will be available for allocation to
other Series or to the Issuer as described in Section 4.05 of the Transfer and
Servicing Agreement.

(b) On each Distribution Date with respect to the Revolving Period, an amount
equal to the Available Principal Collections deposited in the Collection Account
for the related Monthly Period shall be distributed in the following order of
priority:

(i) an amount equal to the Borrowing Base Excess Amount shall be distributed to
the Class A Noteholders; and

(ii) an amount equal to the balance, if any, of such Available Principal
Collections shall be treated as Shared Principal Collections and applied in
accordance with Section 4.02 of the Transfer and Servicing Agreement

(c) On each Distribution Date with respect to the Controlled Redemption Period
or the Early Redemption Period, an amount equal to the Available Principal
Collections deposited in the Collection Account for the related Monthly Period
shall be distributed in the following order of priority:

(i) an amount, to the extent available, equal to the Class A Note Principal
Balance shall be distributed to the Class A Noteholders;

(ii) for each Distribution Date beginning on the Distribution Date on which the
Class A Notes have been paid in full, an amount, to the extent available, equal
to the Class B Note Principal Balance shall be distributed to the Class B
Noteholders; and

(iii) for each Distribution Date beginning on the Distribution Date on which the
Class B Notes are paid in full, an amount equal to the balance, if any, of such
Available Principal Collections shall be treated as Shared Principal Collections
and applied in accordance with Section 4.02 of the Transfer and Servicing
Agreement.

 

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(d) On each Distribution Date with respect to the Limited Redemption Period, an
amount equal to the Available Principal Collections deposited in the Collection
Account for the related Monthly Period shall be distributed in the following
order of priority:

(i) an amount equal to the Limited Redemption Amount shall be distributed to the
Class A Noteholders; and

(ii) the balance of such Available Principal Collections shall be treated as
Shared Principal Collections and applied in accordance with Section 4.02 of the
Transfer and Servicing Agreement.

Section 4.06. Defaulted Amounts; Reduction Amounts.

On each Determination Date, the Servicer shall calculate the Series Default
Amount for the related Distribution Date. If, on any Distribution Date, the
Series Default Amount for the related Monthly Period exceeds the Available Funds
allocated and available for that purpose pursuant to subsection 4.05(a)(iii) for
such Distribution Date, the Allocation Amount (after giving effect to any
reductions for Reallocated Principal Collections that under Section 4.07 were
used to fund the Class A Required Amount on such Distribution Date), will be
reduced, subject to the succeeding sentence, by the amount of such excess, but
not by more than the Series Default Amount for such Distribution Date (a
“Reduction Amount”). In the event that such reduction would cause the Allocation
Amount to be a negative number, the Allocation Amount shall be reduced to zero.
Reduction Amounts shall thereafter be reimbursed and the Allocation Amount
increased (but not by an amount in excess of the aggregate unreimbursed
Reduction Amounts) on any Distribution Date by the amount of Available Funds
allocated and available for that purpose pursuant to subsection 4.05(a)(iv).

Section 4.07. Reallocated Principal Collections.

(a) On each Distribution Date, the Servicer shall apply, or shall cause the
Indenture Trustee to apply, by written instruction delivered to the Indenture
Trustee, Reallocated Principal Collections with respect to such Distribution
Date, to fund the Class A Required Amount.

On each Distribution Date, the Allocation Amount shall be reduced by the amount
of Reallocated Principal Collections used to fund the Class A Required Amount
for such Distribution Date, but in any event the Allocation Amount shall not be
reduced by operation of this subsection 4.07(a) to an amount less than the
Class A Note Principal Balance.

(b) Reallocated Principal Collections used to fund the Class A Required Amount
shall thereafter be reimbursed, and the Allocation Amount increased (but not by
an amount in excess of the aggregate unreimbursed Reallocated Principal
Collections used to fund the Class A Required Amount) on any Distribution Date
by the amount of Available Funds allocated and available for that purpose
pursuant to subsection 4.05(a)(iv).

Section 4.08. Excess Finance Charge Collections. Series 2006-One shall be an
Excess Allocation Series. Subject to Section 4.05 of the Transfer and Servicing
Agreement, Excess Finance Charge Collections with respect to all the Excess
Allocation Series for any

 

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Distribution Date will be allocated to Series 2006-One in an amount equal to the
product of (x) the aggregate amount of Excess Finance Charge Collections with
respect to all the Excess Allocation Series for such Distribution Date and (y) a
fraction, the numerator of which is the Finance Charge Shortfall for Series
2006-One for such Distribution Date and the denominator of which is the
aggregate amount of Finance Charge Shortfalls for all the Excess Allocation
Series for such Distribution Date. The “Finance Charge Shortfall” for Series
2006-One for any Distribution Date will be equal to the excess, if any, of
(a) the full amount required to be paid, without duplication, pursuant to
subsections 4.05(a)(i) through (ix) on such Distribution Date over (b) the
Reallocated Series Finance Charge Collections for such Distribution Date.

Section 4.09. Reallocated Series Finance Charge Collections.

(a) That portion of Group I Series Finance Charge Collections for any
Distribution Date equal to the amount of Reallocated Series Finance Charge
Collections for such Distribution Date will be allocated to Series 2006-One and
will be distributed as set forth in this Supplement.

(b) Reallocated Series Finance Charge Collections with respect to any
Distribution Date shall equal the sum of (i) the aggregate amount of Series
2006-One Monthly Interest, Series Default Amount, Series 2006-One Monthly Fees
and Series 2006-One Additional Amounts for such Distribution Date and (ii) that
portion of excess Group I Series Finance Charge Collections to be included in
Reallocated Series Finance Charge Collections pursuant to subsection (c) hereof;
provided, however, that if the amount of Group I Series Finance Charge
Collections for such Distribution Date is less than the sum of (w) Group I
Series Monthly Interest, (x) Group I Series Default Amount, (y) Group I Series
Monthly Fees and (z) Group I Series Additional Amounts, then Reallocated Series
Finance Charge Collections shall equal the sum of the following amounts for such
Distribution Date:

 

  (A) the product of (I) Group I Series Finance Charge Collections (up to the
amount of Group I Series Monthly Interest) and (II) a fraction, the numerator of
which is Series 2006-One Monthly Interest and the denominator of which is Group
I Series Monthly Interest;

 

  (B) the product of (I) Group I Series Finance Charge Collections less the
amount of Group I Series Monthly Interest (such amount not less than zero) (up
to the Group I Series Default Amount) and (II) a fraction, the numerator of
which is the Series Default Amount and the denominator of which is the Group I
Series Default Amount;

 

  (C) the product of (I) Group I Series Finance Charge Collections less the sum
of (i) Group I Series Monthly Interest and (ii) the Group I Series Default
Amount (such amount not less than zero) (up to Group I Series Monthly Fees) and
(II) a fraction, the numerator of which is Series 2006-One Monthly Fees and the
denominator of which is Group I Series Monthly Fees; and

 

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  (D) the product of (I) Group I Series Finance Charge Collections less the sum
of (i) Group I Series Monthly Interest, (ii) the Group I Series Default Amount
and (iii) Group I Series Monthly Fees (such amount not less than zero) and (II)
a fraction, the numerator of which is Series 2006-One Additional Amounts and the
denominator of which is Group I Series Additional Amounts.

(c) If the amount of Group I Series Finance Charge Collections for such
Distribution Date exceeds the sum of (i) Group I Series Monthly Interest,
(ii) Group I Series Default Amount, (iii) Group I Series Monthly Fees and
(iv) Group I Series Additional Amounts, then Reallocated Series Finance Charge
Collections for such Distribution Date shall include an amount equal to the
product of (x) the amount of such excess and (y) a fraction, the numerator of
which is the Allocation Amount as of the last day of the preceding Monthly
Period and the denominator of which is the sum of such Allocation Amount and the
aggregate allocation amounts for all other Series included in Group I as of such
last day.

Section 4.10. Shared Principal Collections. Subject to Section 4.02 of the
Transfer and Servicing Agreement, Shared Principal Collections for any
Distribution Date will be allocated to Series 2006-One in an amount equal to the
product of (x) the aggregate amount of Shared Principal Collections with respect
to all Principal Sharing Series for such Distribution Date and (y) a fraction,
the numerator of which is the Series 2006-One Principal Shortfall for such
Distribution Date and the denominator of which is the aggregate amount of
Principal Shortfalls for all the Series which are Principal Sharing Series for
such Distribution Date. The “Series 2006-One Principal Shortfall” will be equal
to (a) for any Distribution Date with respect to the Revolving Period, zero;
provided, that if such Distribution Date is an Optional Redemption Date, the
Series 2006-One Shortfall shall be an amount determined by the Issuer not to
exceed the related Optional Redemption Amount, and (b) for any Distribution Date
with respect to the Controlled Redemption Period or the Early Redemption Period,
the excess, if any, of the Allocation Amount over the amount of Available
Principal Collections for such Distribution Date (excluding any portion thereof
attributable to Shared Principal Collections) and (c) for any Distribution Date
with respect to the Limited Redemption Period, the excess, if any, of the
Limited Redemption Amount over the amount of Available Principal Collections for
such Distribution Date (excluding any portion thereof attributable to Shared
Principal Collections).

Section 4.11. Spread Account.

(a) The Servicer shall establish and maintain, in the name of the Indenture
Trustee, for the benefit of the Class A Noteholders and the Class B Noteholders,
an Eligible Deposit Account (the “Spread Account”) bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Class A Noteholders and the Class B Noteholders. The Spread Account shall
initially be established with the Indenture Trustee. The Indenture Trustee shall
possess all right, title and interest in all funds on deposit from time to time
in the Spread Account and in all proceeds thereof. The Spread Account shall be
under the sole dominion and control of the Indenture Trustee for the benefit of
the Class A Noteholders and the Class B Noteholders. If at any time the Spread
Account ceases to be an Eligible Deposit Account, the Indenture Trustee (or the
Servicer on its behalf) shall within 10 Business Days (or such longer period,
not to exceed 30 calendar days, as to which the Administrative Agent shall

 

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consent) establish a new Spread Account meeting the conditions specified above
as an Eligible Deposit Account, and shall transfer any cash or any investments
to such new Spread Account. The Indenture Trustee, at the written direction of
the Servicer, shall (i) make withdrawals from the Spread Account from time to
time in an amount up to the Available Spread Account Amount at such time, for
the purposes set forth in this Supplement, and (ii) on each Distribution Date
prior to the termination of the Spread Account make a deposit into the Spread
Account in the amount specified in, and otherwise in accordance with, subsection
4.05(a)(viii).

(b) Funds on deposit in the Spread Account shall be invested at the written
direction of the Servicer by the Indenture Trustee in Eligible Investments. In
no event shall the Indenture Trustee be liable for the selection of Eligible
Investments or for investment losses incurred thereon, except with respect to
investments on which the institution acting as the Indenture Trustee is an
obligor. The Indenture Trustee shall have no liability in respect of losses
incurred as a result of the liquidation of any Eligible Investment prior to its
stated maturity or the failure of the Servicer to provide timely written
investment direction. The Indenture Trustee shall have no obligation to invest
or reinvest any amounts held hereunder in the absence of written investment
direction. Funds on deposit in the Spread Account on any Transfer Date, after
giving effect to any withdrawals from the Spread Account on such Transfer Date,
shall be invested in such investments that will mature so that such funds will
be available for withdrawal on or prior to the following Transfer Date. The
Indenture Trustee shall hold such Eligible Investments as provided in
Section 6.15 of the Indenture. No such Eligible Investment shall be disposed of
prior to its maturity; provided, however, that the Indenture Trustee may sell,
liquidate or dispose of any such Eligible Investment before its maturity, at the
written direction of the Servicer, if such sale, liquidation or disposal would
not result in a loss of all or part of the principal portion of such Eligible
Investment or if, prior to the maturity of such Eligible Investment, a default
occurs in the payment of principal, interest or any other amount with respect to
such Eligible Investment. On each Distribution Date, all interest and earnings
(net of losses and investment expenses) accrued since the preceding Distribution
Date on funds on deposit in the Spread Account shall be retained in the Spread
Account (to the extent that the Available Spread Account Amount is less than the
Required Spread Account Amount) and the balance, if any, shall be deposited in
the Collection Account and treated as Collections of Finance Charge Receivables
allocable to Series 2006-One. For purposes of determining the availability of
funds or the balance in the Spread Account for any reason under this Supplement,
except as otherwise provided in the preceding sentence, investment earnings on
such funds shall be deemed not to be available or on deposit.

(c) In the event that for any Distribution Date (x) the sum of the amounts
required pursuant to subsections 4.05(a)(i) through (vi) exceeds (y) the amount
of Reallocated Series Finance Charge Collections and Excess Finance Charge
Collections allocated to Series 2006-One (any such excess, the “Spread Account
Draw Amount”), the Spread Account Draw Amount, up to the Available Spread
Account Amount, shall be withdrawn from the Spread Account on the related
Transfer Date by the Indenture Trustee (acting in accordance with the written
instructions of the Servicer), deposited into the Collection Account and
included in Available Funds for such Distribution Date. Notwithstanding anything
else to the contrary in this Section 4.11, if an Event of Default shall have
occurred with respect to Series 2006-One and the maturity of the Series 2006-One
Notes shall have been accelerated under Section 5.03 of the

 

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Indenture, any amounts remaining on deposit in the Spread Account shall be
applied to pay interest and principal on the Class A Notes as provided in
Section 5.03 of the Indenture.

(d) In the event that the Spread Account Surplus on any Distribution Date, after
giving effect to all deposits to and withdrawals from the Spread Account with
respect to such Distribution Date, is greater than zero, the Indenture Trustee,
acting in accordance with the written instructions of the Servicer, shall
withdraw from the Spread Account, and pay to the Issuer for distribution
pursuant to the Trust Agreement, an amount equal to such Spread Account Surplus.

(e) Upon the earlier to occur of (i) the day on which the principal balance of
the Class A Notes and all other accrued and unpaid amounts owing to the Class A
Noteholders, the Administrative Agent or the Agents pursuant to the Class A Note
Purchase Agreement are paid in full and (ii) the termination of the Issuer
pursuant to the Trust Agreement, the Indenture Trustee, acting in accordance
with the instructions of the Servicer, after the prior payment of all amounts
owing to the Class A Noteholders, or their respective agents, which are payable
from the Spread Account as provided herein, shall withdraw from the Spread
Account and pay to the Issuer (or if the Issuer has been terminated, the
Transferor) for application pursuant to the Trust Agreement all amounts, if any,
on deposit in the Spread Account and the Spread Account shall be deemed to have
terminated for purposes of this Supplement.

Section 4.12. Principal Amount Increases.

(a) The Class A Noteholders agree, by acceptance of the Class A Notes, that the
Issuer may from time to time, prior to the commencement of the Controlled
Redemption Period or the Early Redemption Period, request upon two Business Days
prior irrevocable written notice to each of the Indenture Trustee, the Servicer
and the Class A Noteholders substantially in the form of Exhibit A to the
Class A Note Purchase Agreement that the Class A Noteholders fund increases in
the outstanding principal balance of the Class A Notes in the specified amounts
(each such amount, a “Class A Note Principal Balance Increase”); provided,
however, that any applicable conditions set forth in Section 3.2 of the Class A
Note Purchase Agreement shall have been satisfied or waived as provided therein.
The Class A Noteholders shall fund a Class A Note Principal Balance Increase,
upon payment, in same day funds, to the Issuer of the amount of such Class A
Note Principal Balance Increase, in accordance with the payment instructions
specified in the notice delivered with respect to such Class A Note Principal
Increase.

(b) The Class B Noteholders agree, by acceptance of the Class B Notes, that the
Issuer may from time to time, prior to the commencement of the Controlled
Redemption Period or the Early Redemption Period, request upon one Business Day
prior written notice to each of the Indenture Trustee, the Servicer and the
Class B Noteholders substantially in the form of Exhibit D that the Class B
Noteholders fund increases in the outstanding principal balance of the Class B
Notes (each such amount, a “Class B Note Principal Balance Increase”); provided,
however, that (i) after giving effect to such Class B Note Principal Balance
Increase, the Transferor Amount shall not be less than the Series Required
Transferor Amount and (ii) after giving effect to such Class B Note Principal
Balance Increase, (a) the product of the Transferor Amount and the Series
2006-One Allocation Percentage shall not be less than (b) the Series

 

25

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Required Transferor Amount. The Class B Noteholders shall fund such increase
through a reduction of the Transferor Amount by the amount of such Class B Note
Principal Balance Increase.

(c) The Issuer may on any Business Day permanently reduce the Facility Limit. In
order to effect the reduction of the Facility Limit pursuant to this subsection
4.12(c), the Issuer shall deliver to the Servicer, the Indenture Trustee and the
Administrative Agent at least five Business Days prior to such reduction a
written notice executed by an Authorized Officer of the Issuer specifying the
decrease in the Facility Limit, the date on which such decrease is to become
effective and the Class A Note Principal Balance on such date. The
Administrative Agent shall, subject to the provisions of the Class A Note
Purchase Agreement, take all actions necessary to reduce the Commitments to an
amount that will permit the specified reduction of the Facility Limit. Upon the
date specified in such notice, if the conditions set forth in this subsection
4.12(c) have been met, the Facility Limit shall be reduced by the amount
specified in such notice.

(d) No decrease in the outstanding principal balance of the Class A Notes
pursuant to Section 4.03 shall limit the ability of the Issuer to increase the
outstanding principal balance of the Class A Notes pursuant to subsection
4.12(a).

Section 4.13. Series 2006-One Distribution Account.

(a) The Servicer shall establish and maintain, in the name of the Indenture
Trustee, for the benefit of the Series 2006-One Noteholders, a Series Account
(the “Series 2006-One Distribution Account”) bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the
Series 2006-One Noteholders. The Series 2006-One Distribution Account shall
initially be established with the Indenture Trustee. The Indenture Trustee shall
possess all right, title and interest in all funds on deposit from time to time
in the Series 2006-One Distribution Account and in all proceeds thereof. The
Series 2006-One Distribution Account shall be under the sole dominion and
control of the Indenture Trustee for the benefit of the Series 2006-One
Noteholders. If at any time the Series 2006-One Distribution Account ceases to
be an Eligible Deposit Account, the Indenture Trustee (or the Servicer on its
behalf) shall within 10 Business Days (or such longer period, not to exceed 30
calendar days, as to which the Series 2006-One Noteholders shall consent)
establish a new Series 2006-One Distribution Account meeting the conditions
specified above as an Eligible Deposit Account, and shall transfer any cash or
any investments to such new Series 2006-One Distribution Account.

(b) On each Distribution Date, the Indenture Trustee, at the written direction
of the Servicer, shall withdraw from the Collection Account and deposit into the
Series 2006-One Distribution Account Collections of Finance Charge Receivables
and Principal Receivables allocated to Series 2006-One on such Distribution Date
for application pursuant to Section 4.05.

 

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ARTICLE V

Distributions and Reports to

Series 2006-One Noteholders

Section 5.01. Distributions.

(a) On each Distribution Date, the Paying Agent, in accordance with the
statement delivered pursuant to subsection 5.02(a)(i), shall distribute to each
Class A Noteholder (other than as provided in Section 10.02 of the Indenture)
such amounts held by the Paying Agent that are allocated and available on such
Distribution Date to pay the Class A Monthly Interest.

(b) On each Special Payment Date, the Paying Agent, in accordance with the
statement delivered pursuant to subsection 5.02(a)(i), shall distribute to each
Class A Noteholder of record on the related Record Date (other than as provided
in Section 10.02 of the Indenture) such amounts held by the Paying Agent that
are allocated and available on such date to pay principal of the Class A Notes
pursuant to this Supplement up to a maximum amount on any such date equal to the
Class A Note Principal Balance on such date.

(c) On each Distribution Date, the Paying Agent, in accordance with the
statement delivered pursuant to subsection 5.02(a)(i), shall distribute to each
Class B Noteholder of record on the related Record Date (other than as provided
in Section 10.02 of the Indenture) such amounts held by the Paying Agent that
are allocated and available on such Distribution Date to pay interest on the
Class B Notes pursuant to this Supplement.

(d) On each Special Payment Date, the Paying Agent, in accordance with the
statement delivered pursuant to subsection 5.02(a)(i), shall distribute to each
Class B Noteholder of record on the related Record Date (other than as provided
in Section 10.02 of the Indenture) such amounts held by the Paying Agent that
are allocated and available on such date to pay principal of the Class B Notes
pursuant to this Supplement up to a maximum amount on any such date equal to the
Class B Note Principal Balance on such date.

(e) The distributions to be made pursuant to this Section 5.01 are subject to
the provisions of Sections 2.06 and 8.01 of the Transfer and Servicing
Agreement, Section 5.05 of the Indenture and Section 8.01 of this Supplement.

(f) Except as provided in Section 10.02 of the Indenture with respect to a final
distribution, distributions to Series 2006-One Noteholders hereunder shall be
made by wire transfer of same day funds to the account that has been designated
by the applicable Noteholders not less than ten Business Days prior to such
Distribution Date.

Section 5.02. Reports and Statements to Series 2006-One Noteholders.

(a) Not later than each Determination Date, the Servicer shall deliver to the
Indenture Trustee, the Paying Agent and the Administrative Agent (i) a statement
substantially in the form of Exhibit C prepared by the Servicer and (ii) a
certificate of a Servicing Officer substantially in the form attached thereto.

 

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(b) A copy of each statement or certificate provided pursuant to
subsection 5.02(a) may be obtained by any Series 2006-One Noteholder or any
beneficial owner thereof by a request in writing to the Servicer.

(c) On or before January 31 of each calendar year, beginning with calendar year
2007, the Paying Agent, on behalf of the Indenture Trustee, shall furnish or
cause to be furnished to each Person who at any time during the preceding
calendar year was a Series 2006-One Noteholder, a statement prepared by the
Servicer containing the information which is required to be contained in the
statement to Series 2006-One Noteholders, as set forth in paragraph (a) above
aggregated for such calendar year or the applicable portion thereof during which
such Person was a Series 2006-One Noteholder, together with other information as
is required to be provided by an issuer of indebtedness under the Code. Such
obligation of the Servicer shall be deemed to have been satisfied to the extent
that substantially comparable information shall be provided by the Paying Agent
pursuant to any requirements of the Code as from time to time in effect.

(d) On or before June 30th each calendar year, beginning with June 30, 2007, the
Servicer shall cause a firm of nationally recognized independent public
accountants (who may also render other services to the Servicer or Transferor)
to deliver a report (addressed to the Servicer) to the effect that the
accountants have applied certain procedures that the accountants are reasonably
able to review and perform under such accounting firm’s policies and are agreed
upon with the Servicer to compare the mathematical calculations of certain
amounts set forth in the Servicer’s certificates delivered pursuant to
subsection 5.02(b) during the period covered by such report with the Servicer’s
computer reports that were the source of such amounts and that on the basis of
such agreed-upon procedures and comparison, such accountants are of the opinion
that such amounts are in agreement, except for such exceptions as they believe
to be immaterial and such other exceptions as shall be set forth in such
statement. Such report shall set forth the agreed-upon procedures performed in
accordance with Exhibit F. The Servicer shall deliver copies thereof to each of
the Issuer, the Transferor, the Indenture Trustee, the Owner Trustee and the
Administrative Agent; provided, that, if required by the accounting firm
preparing such report, delivery of such copy shall be contingent upon such
recipient reaching an agreement with such accounting firm concerning any
potential terms or conditions associated with the release of such report to such
recipient. In the event such firm requires the Indenture Trustee to agree to the
procedures performed by such firm, the Servicer shall direct the Indenture
Trustee in writing to so agree; it being understood and agreed that the
Indenture Trustee will deliver such letter of agreement in conclusive reliance
upon the direction of the Servicer, and the Indenture Trustee makes no
independent inquiry or investigation as to, and shall have no obligation or
liability in respect of, the sufficiency, validity or correctness of such
procedures.

 

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ARTICLE VI

Early Redemption Events

Section 6.01. Early Redemption Events. If any one of the following events shall
occur with respect to the Series 2006-One Notes:

(a) (i) failure on the part of the Transferor or the Issuer to make any payment
or deposit required by the terms of the Transfer and Servicing Agreement, the
Indenture or this Supplement on or before the date occurring five Business Days
after the date such payment or deposit is required to be made therein or herein
or (ii) failure on the part of the Transferor duly to observe or perform any
other covenants or agreements of the Transferor set forth in the Transfer and
Servicing Agreement or the CFC Receivables Purchase Agreement, or failure on the
part of the Issuer duly to observe or perform any other covenants of the Issuer
set forth in the Indenture or this Supplement, which failure has a material
adverse effect on the Series 2006-One Noteholders and which continues unremedied
for a period of 60 days after the date on which the Issuer or the Transferor, as
applicable, obtains actual knowledge of such failure or on which written notice
of such failure requiring the same to be remedied, shall have been given to the
Transferor and the Issuer by the Indenture Trustee, or to the Transferor, the
Issuer and the Indenture Trustee by the Administrative Agent or any Holder of a
Class A Note;

(b) any representation or warranty made by (i) the Transferor in the Transfer
and Servicing Agreement or (ii) the Issuer in the Indenture or this Supplement
shall prove to have been incorrect when made or when delivered, which continues
to be incorrect for a period of 60 days after the date on which written notice
of such failure, requiring the same to be remedied, shall have been given to the
Transferor and the Issuer by the Indenture Trustee, or to the Transferor, the
Issuer and the Indenture Trustee by any Holder of the Series 2006-One Notes, and
as a result of which the interests of the Series 2006-One Noteholders are
materially and adversely affected for such period; provided, however, that an
Early Redemption Event pursuant to this subsection 6.01(b) shall not be deemed
to have occurred hereunder if the Transferor has accepted reassignment of the
related Receivable, or all of such Receivables, if applicable, during such
period in accordance with the provisions of the Transfer and Servicing
Agreement;

(c) the occurrence of a Servicer Default;

(d) the Excess Spread Percentage for any Monthly Period is less than 8.0%;

(e) the Delinquency Ratio for any Monthly Periods exceeds 45%;

(f) the Indenture Trustee shall, for any reason, fail to have a valid and
perfected first priority security interest in such of the Receivables as shall
constitute part of the Trust Estate;

(g) any material adverse change in the operations of the Transferor or the
Servicer, or any other event, which materially affects the Transferor’s or the
Servicer’s ability to collect upon the Receivables or the Transferor’s or the
Servicer’s ability to perform thereunder;

 

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(h) the average Monthly Principal Payment Rate for any three consecutive Monthly
Periods is less than 5.0%;

(i) the average Default Rate for any three consecutive Monthly Periods is
greater than 35%;

(j) without limiting any of the foregoing, the occurrence of an Event of Default
with respect to Series 2006-One and acceleration of the maturity of the Series
2006-One Notes in accordance with Section 5.03 of the Indenture;

(k) the occurrence of a material adverse change in the business, operations,
condition (financial or otherwise) or prospect of CompuCredit Corporation;

(l) no affinity agreement between an Account Owner and CompuCredit is in full
force and effect;

(m) CompuCredit fails to maintain a Tangible Net Worth at any time greater than
or equal to the sum of (i) $400,000,000 plus (ii) 75% of the cumulative positive
net income (without deduction for negative net income) of CompuCredit for each
fiscal quarter having been completed since September 30, 2005, as reported in
each annual report on Form 10-K and periodic report on Form 10-Q filed by
CompuCredit with the Securities and Exchange Commission plus (iii) 75% of the
net proceeds of any equity issued by CompuCredit since September 30, 2005 minus
(iv) the purchase price of all common stock of CompuCredit repurchased after
September 30, 2005; for the purpose of this paragraph, any potential changes in
the Tangible Net Worth of CompuCredit caused by any future change in GAAP that
may affect the off balance sheet classification of any securitization
arrangement will not be considered in this calculation; and

(n) the occurrence of a Termination Event (as defined in the Class A Note
Purchase Agreement);

then, in the case of any event described in subparagraph (a), (b), (c), (g), or
(k), after the applicable grace period, if any, set forth in such subparagraphs,
either the Indenture Trustee or the Holders of Class A Notes evidencing more
than 50% of the Class A Note Principal Balance, by notice then given in writing
to the Issuer, the Servicer and the Indenture Trustee may declare that an Early
Redemption Event has occurred with respect to Series 2006-One as of the date of
such notice, and, in the case of any event described in subparagraph (d), (e),
(f), (h), (i), (j), (l), (m) or (n), an Early Redemption Event shall occur with
respect to Series 2006-One without any notice or other action on the part of the
Indenture Trustee or the Series 2006-One Noteholders immediately upon the
occurrence of such event, unless such Early Redemption Event is waived by the
Holders of Class A Notes evidencing more than 50% of the Class A Note Principal
Balance, by notice given in writing to the Indenture Trustee, the Issuer and the
Servicer.

 

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ARTICLE VII

Administrative Redemption; Series Termination

Section 7.01. Administrative Redemption.

(a) On any day occurring on or after the date on which the Note Principal
Balance is reduced to 20% or less of the highest Note Principal Balance at any
time on or after the Closing Date, the Issuer, at the direction of the
Transferor, shall have the option to redeem the Series 2006-One Notes, at a
redemption price equal to (i) if such day is a Distribution Date, the Redemption
Amount for such Distribution Date or (ii) if such day is not a Distribution
Date, the Redemption Amount for the Distribution Date first following such day.

(b) The Issuer shall give the Servicer and the Indenture Trustee at least 30
days prior written notice of the date on which the Issuer intends to exercise
such redemption option. The Issuer shall deposit the Redemption Amount into the
Collection Account in same day funds on the day prior to such scheduled
redemption. Such redemption option is subject to payment in full of the
Redemption Amount. Following the deposit of the Redemption Amount into the
Collection Amount in accordance with the foregoing, the Allocation Amount for
Series 2006-One shall be reduced to zero and the Series 2006-One Noteholders
shall have no further interest in the Trust Estate. The Redemption Amount shall
be distributed as set forth in subsection 8.01(b).

Section 7.02. Stated Maturity Date.

On the Stated Maturity Date, the right of the Series 2006-One Noteholders to
receive payments from the Issuer will be limited solely to the right to receive
payments pursuant to Section 5.05 of the Indenture and Section 8.01 of this
Supplement.

ARTICLE VIII

Redemption of Series 2006-One Notes; Final Distributions

Section 8.01. Sale of Receivables or Redemption of the Notes pursuant to
Section 2.06 or 8.01 of the Transfer and Servicing Agreement and Sections 5.05
and 5.17 of the Indenture and Section 7.01 of this Supplement.

(a) (i) The amount to be paid by the Transferor with respect to Series 2006-One
in connection with a reassignment of Receivables to the Transferor pursuant to
Section 2.06 of the Transfer and Servicing Agreement shall equal the Redemption
Amount for the first Distribution Date following the Monthly Period in which the
reassignment obligation arises under the Transfer and Servicing Agreement.

(ii) The amount to be paid by the Transferor with respect to Series 2006-One in
connection with any purchase of the Notes, pursuant to the exercise of a right
of first refusal contained in Section 8.01(d) of the Transfer and Servicing
Agreement shall be an amount equal to the Redemption Amount for the Distribution
Date of any such purchase.

 

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(b) With respect to the Redemption Amount deposited into the Collection Account
pursuant to Section 7.01 or subsection 8.01(a) or any amounts allocable to the
Series 2006-One Notes deposited into the Collection Account pursuant to Sections
5.05 and 5.17 of the Indenture, the Indenture Trustee shall, in accordance with
the written direction of the Servicer, not later than 2:30 p.m., New York City
time, on the related Distribution Date, make deposits or distributions of the
following amounts (in the priority set forth below and, in each case after
giving effect to any deposits and distributions otherwise to be made on such
date) in same day funds: (i) (x) the Class A Note Principal Balance on such
Distribution Date will be distributed to the Paying Agent for payment to the
Class A Noteholders and (y) an amount equal to the sum of (A) Class A Monthly
Interest for such Distribution Date and (B) any Class A Monthly Interest
previously due but not distributed to the Class A Noteholders on a prior
Distribution Date will be distributed to the Paying Agent for payment to the
Class A Noteholders, (ii) the Series 2006-One Additional Amounts shall be
distributed to the Paying Agent for payment to the Administrative Agent,
(iv) the Series 2006-One Monthly Fees will be distributed to the Servicer and
(v) the Class B Note Principal Balance and any accrued interest thereon will be
distributed to the Paying Agent for payment to the Class B Noteholders.

(c) Notwithstanding anything to the contrary in this Supplement or the
Indenture, all amounts distributed to the Paying Agent pursuant to subsection
8.01(b) for payment to the Series 2006-One Noteholders shall be deemed
distributed in full to the Series 2006-One Noteholders on the date on which such
funds are distributed to the Paying Agent pursuant to this Section and the
Series 2006-One Notes shall be deemed to be no longer Outstanding as such term
is defined in Section 1.01 of the Indenture.

ARTICLE IX

Miscellaneous Provisions

Section 9.01. Ratification of Agreement. As supplemented by this Supplement, the
Indenture is in all respects ratified and confirmed and the Indenture as so
supplemented by this Supplement shall be read, taken and construed as one and
the same instrument.

Section 9.02. Counterparts. This Supplement may be executed in two or more
counterparts, and by different parties on separate counterparts, each of which
shall be an original, but all of which shall constitute one and the same
instrument.

Section 9.03. Governing Law. THIS SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE
PERFORMED THEREIN.

Section 9.04. Tax Matters.

(a) Notwithstanding anything to the contrary herein, each of the Paying Agent,
Servicer or Indenture Trustee shall be entitled to withhold any amount that it
determines in its sole discretion is required to be withheld pursuant to
Section 1446 of the Code and such amount shall be deemed to have been paid for
all purposes of the Indenture.

 

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(b) Each of the Series 2006-One Noteholders agrees that prior to the date on
which the first interest payment hereunder is due thereto, it will provide to
the Servicer and the Indenture Trustee (i) if such Series 2006-One Noteholder is
created or organized in or under the laws of a jurisdiction outside the United
States, two duly completed copies of the United States Internal Revenue Service
Form W-8ECI or, if the Transferor in its sole discretion consents, Form W-8BEN
claiming treaty benefits, or in either case successor applicable or required
forms, (ii) in any other case, a duly completed copy of United States Internal
Revenue Service Form W-9 or successor applicable or required forms, and
(iii) such other forms and information as may be reasonably required to confirm
the availability of any applicable exemption from United States federal, state
or local withholding taxes. Each Series 2006-One Noteholder agrees to provide to
the Servicer and Indenture Trustee like additional subsequent duly completed
forms (subject to like consent) satisfactory to the Servicer and Indenture
Trustee on or before the date that any such form expires or becomes obsolete, or
upon the occurrence of any event requiring an amendment, resubmission or change
in the most recent form previously delivered by it, and to provide such
extensions or renewals as may be reasonably requested by the Servicer or
Indenture Trustee. Each Series 2006-One Noteholder certifies, represents and
warrants that as of the date of this Agreement, or in the case of a Series
2006-One Noteholder which is an assignee as of the date of such Note Assignment,
that it is entitled (x) to receive payments under this Supplement without
deduction or withholding (other than pursuant to Section 1446 of the Code, if
applicable) of any United States federal income taxes and (y) to an exemption
from United States backup withholding tax. Each Series 2006-One Noteholder
represents and warrants that it shall pay any taxes imposed on such Series
2006-One Noteholder attributable to its interest in the Series 2006-One Notes.

(c) Each Series 2006-One Noteholder agrees with the Transferor that: (1) such
Series 2006-One Noteholder will deliver to the Transferor on or before the
Closing Date or the effective date of any participation or Note Assignment a
letter (an “Investment Letter”) in the form of Exhibit E, executed by such
assignee Series 2006-One Noteholder, in the case of a Note Assignment, or by the
Participant, in the case of a participation, with respect to the purchase by
such Series 2006-One Noteholder or Participant of a portion of an interest
relating to the Series 2006-One Note and (2) all of the statements made by such
Series 2006-One Noteholder or Participant, as applicable in its Investment
Letter shall be true and correct as of the date made.

(d) Each Series 2006-One Noteholder, by its holding of an interest in the Series
2006-One Notes, hereby severally represents, warrants and covenants, and each
Series 2006-One Noteholder that acquires an interest in the Series 2006-One
Notes by Note Assignment shall be deemed to have severally represented,
warranted and covenanted upon such Note Assignment that: (i) such Series
2006-One Noteholder has not acquired and shall not sell, trade or transfer any
interest in the Series 2006-One Notes, nor cause any interest in the Series
2006-One Notes to be marketed, on or through either (A) an “established
securities market (or the substantial equivalent thereof)” within the meaning of
Section 7704(b)(1) of the Code (including an interdealer quotation system that
regularly disseminates firm buy or sell quotations by identified brokers or
dealers by electronic means or otherwise) or (B) a “secondary market (or the
substantial equivalent thereof)” within the meaning of Section 7704(b)(2) of the
Code (including a market wherein interests in the Series 2006-One Notes are
regularly quoted by any person making a market in such interests and a market
wherein any person regularly makes available bid or offer quotes with respect to
interests in the Series 2006-One Notes and stands

 

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ready to effect buy or sell transactions at the quoted prices for itself or on
behalf of others), and (ii) unless the Transferor consents otherwise, such
Series 2006-One Noteholder (A) is properly classified as, and shall remain
classified as, a “corporation” as described in Section 7701(a)(3) of the Code
and (B) is not, and shall not become, an “S corporation” as described in
Section 1361 of the Code. Each Series 2006-One Noteholder represents, warrants
and covenants that it shall (A) cause each of its Participants otherwise
permitted hereunder to make representations, warranties and covenants similar to
the foregoing for the benefit of the Transferor and the Issuer at the time such
Participant becomes a Participant and (B) forward a copy of such
representations, warranties and covenants to the Indenture Trustee. In the event
of any breach of the representation, warranty and covenant of a Series 2006-One
Noteholder or its Participant that such Series 2006-One Noteholder or
Participant shall remain classified as a corporation other than an S
corporation, such Series 2006-One Noteholder shall notify the Transferor
promptly upon such Series 2006-One Noteholder’s becoming aware of such breach,
and thereupon the Series 2006-One Noteholder hereby agrees to use reasonable
efforts to procure a replacement investor which is acceptable to the Transferor
not so affected to replace such affected Series 2006-One Noteholder. In any such
event, the Transferor shall also have the right to procure a replacement
investor. Each affected Series 2006-One Noteholder hereby agrees to take all
actions necessary to permit a replacement investor to succeed to its rights and
obligations hereunder. Each Series 2006-One Noteholder which has a Participant
which has breached its representation, warranty and covenant that it shall
remain classified as a corporation other than an S corporation hereby agrees
(without limiting the right of the Transferor to procure a replacement investor
for such Series 2006-One Noteholder as provided above in this paragraph) to
notify the Transferor of such breach promptly upon such Series 2006-One
Noteholder’s becoming aware thereof and to use reasonable efforts to procure a
replacement Participant, as applicable, not so affected which is acceptable to
the Transferor to replace any such Participant.

(e) Subject to the provisions of subsection 9.04(g), each Series 2006-One
Noteholder may at any time sell, assign or otherwise transfer, to the extent of
such Series 2006-One Noteholder’s interest in the Series 2006-One Notes (each, a
“Note Assignment”), to any Permitted Transferee (as defined in the Class A Note
Purchase Agreement), all or part of its interest in the Series 2006-One Notes;
provided, however, that any Note Assignment shall be void unless (i) the minimum
amount of such Note Assignment shall be $5,000,000, (ii) such assignee Series
2006-One Noteholder shall comply with this Section 9.04 and shall have delivered
to the Indenture Trustee, prior to the effectiveness of such Note Assignment, a
copy of an agreement under which such assignee Series 2006-One Noteholder has
made the representations, warranties and covenants required to be made pursuant
to this Section 9.04, (iii) following the Note Assignment there shall not be in
the aggregate more than the number set forth in Item 8 of Schedule A of
beneficial owners of an interest or Participants holding an interest in the
Class A Notes, and (iv) such proposed assignee shall provide the forms described
in clauses (i), (ii) and (iii) of subsection 9.04(b) (subject to the
Transferor’s consent, as applicable and as set forth therein) in the manner
described therein. In connection with any Note Assignment, the assignor Series
2006-One Noteholder shall request in writing to the Indenture Trustee (who shall
promptly deliver it to the Transferor) for the consent of the Transferor (the
Transferor shall respond to any such request within ten (10) Business Days after
its receipt and the Transferor will not unreasonably withhold such consent) it
being understood that, except in the case of a Note Assignment to a Permitted
Transferee, the obtaining of such consent is a condition to the effectiveness of
the Note Assignment. Each assignee Series 2006-One

 

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Noteholder is subject to the terms and conditions of subsection 9.04(b) on an
ongoing basis and hereby makes the certifications, representations and
warranties contained therein.

(f) Subject to the provisions of subsection 9.04(g), any Series 2006-One
Noteholder may at any time grant a participation in all or part (but not less
than $5,000,000) of its interest in Series 2006-One Notes to any Permitted
Transferee (as defined in the Class A Note Purchase Agreement) (each such
Person, a “Participant”); provided, however, that such participation shall be
void, unless (i) such Participant complies with the applicable provisions of
this Section 9.04, (ii) such Series 2006-One Noteholder delivers to the
Indenture Trustee, prior to the effectiveness of its participation, a copy of an
agreement under which such Participant has made the representations, warranties
and covenants required to be made pursuant to this Section 9.04, and
(iii) following the participation there would not be in the aggregate more than
the number set forth in Item 8 of Schedule A of beneficial owners of an interest
or Participants holding an interest in the Class A Notes. In connection with the
granting of any such participation to any Person, the granting Series 2006-One
Noteholder shall provide a written request to the Indenture Trustee (who shall
promptly deliver it to the Transferor) for the consent of the Transferor to the
granting of the specified interest to any identified prospective Participant.
The Transferor shall respond to any such request within ten (10) Business Days
after its receipt, it being understood that, except in the case of a
Participation to a Permitted Transferee, the obtaining of such consent is a
condition to the effectiveness of a participation. Each Series 2006-One
Noteholder hereby acknowledges and agrees that any such participation will not
alter or affect in any way whatsoever such Series 2006-One Noteholder’s direct
obligations hereunder and that the Transferor shall have no obligation to have
any communication or relationship whatsoever with any Participant of such Series
2006-One Noteholder in order to enforce the obligations of such Series 2006-One
Noteholder hereunder. Each Series 2006-One Noteholder shall promptly notify the
Indenture Trustee (which shall promptly notify the Transferor) in writing of the
identity and interest of each Participant upon any such disposition. As a
condition of granting any participation, the Series 2006-One Noteholder hereby
agrees to deliver to the Transferor a certification of the proposed Participant
pursuant to which the Participant certifies, represents and warrants that
(i) such Participant is entitled to (x) receive payments with respect to its
participation without deduction or withholding of any United States federal
income taxes and (y) an exemption from United States backup withholding tax,
(ii) prior to the date on which the first interest payment is due to the
Participant, such Series 2006-One Noteholder will provide to the Servicer and
Indenture Trustee, the forms described in clauses (i), (ii) and (iii) of
subsection 9.04(b) (subject to the Transferor’s consent, as applicable and as
set forth therein) as though the Participant were a Series 2006-One Noteholder,
(iii) such Series 2006-One Noteholder similarly will provide subsequent forms as
described in subsection 9.04(b) with respect to such Participant as though it
were a Series 2006-One Noteholder, and (iv) such Participant will pay any taxes
imposed on its participation interest in the Series 2006-One Notes.

(g) Except (i) as provided in subsections 9.04(e) and (f) above and (ii) in
connection with any pledge to any Federal Reserve Bank to secure any obligation
of a Series 2006-One Noteholder, no Series 2006-One Noteholder may sell,
transfer, assign, exchange, participate or otherwise convey or pledge,
hypothecate, rehypothecate, or otherwise grant a security interest in a Series
2006-One Note and any such attempted sale, transfer, assignment, exchange,
participation, conveyance, pledge, hypothecation, rehypothecation or grant shall
be void.

 

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Section 9.05. Transfer of Class B Notes . Any transfer of the Class B Notes
shall be subject to delivery to the Indenture Trustee of a Tax Opinion with
respect to such transfer.

Section 9.06. Limitation of Liability. It is expressly understood and agreed by
the parties hereto that (a) this Supplement is executed and delivered by
Wilmington Trust, FSB, not individually or personally but solely as trustee of
the Issuer, in the exercise of the powers and authority conferred and vested in
it under the Trust Agreement, (b) each of the representations, undertakings and
agreements herein made on the part of the Issuer is made and intended not as
personal representations, undertakings and agreements by Wilmington Trust, FSB
but is made and intended for the purpose of binding only the Issuer and
(c) under no circumstances shall Wilmington Trust, FSB be personally liable for
the payment of any indebtedness or expenses of the Issuer or be liable for the
breach or failure of any obligation, representation, warranty or covenant made
or undertaken by the Issuer under this Supplement or any other document to which
the Issuer is a party.

 

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IN WITNESS WHEREOF, the Issuer, the Servicer and the Indenture Trustee have
caused this Indenture Supplement to be duly executed by their respective
officers thereunto duly authorized, all as of the date first above written.

 

COMPUCREDIT CREDIT CARD MASTER NOTE

BUSINESS TRUST III,

Issuer

By:

  WILMINGTON TRUST FSB  

not in its individual capacity, but solely

 

as Owner Trustee

By:

 

/s/ Mindy Riddle

 

Name: Mindy Riddle

 

Title:   Senior Financial Services Officer

U.S. BANK NATIONAL ASSOCIATION,

Indenture Trustee

By:  

/s/ Tamara Schultz-Fugh

 

Name: Tamara Schultz-Fugh

 

Title:   Vice President

COMPUCREDIT CORPORATION,

Servicer

By:

 

/s/ William R. McCamey

 

Name: William R. McCamey

 

Title:   Treasurer