Exhibit
4.3


 


EXECUTION VERSION


 


SERIES 2004-2 INDENTURE SUPPLEMENT


 


to MASTER INDENTURE


 


 


between


 


SSCE FUNDING, LLC,


as Issuer,


 


and


 


DEUTSCHE
BANK TRUST COMPANY AMERICAS,


as Indenture Trustee


on behalf of the Series 2004-2 Noteholders


 


DATED AS OF NOVEMBER 23, 2004


 



SSCE FUNDING, LLC


VARIABLE FUNDING NOTE, SERIES 2004-2


 





















 


TABLE OF
CONTENTS


 


	
  ARTICLE I

  	
  DEFINITIONS;
  INCORPORATION OF TERMS

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SECTION 1.1

  	
  Definitions

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 1.2

  	
  Incorporation of Terms

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II

  	
  DESIGNATION;
  AUTHENTICATION AND DELIVERY

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SECTION 2.1

  	
  Designation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 2.2

  	
  Authentication and Delivery

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III

  	
  CONDITIONS TO
  ISSUANCE; USE OF PROCEEDS

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SECTION 3.1

  	
  Conditions to Initial
  Issuance

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 3.2

  	
  Use of Proceeds

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 3.3

  	
  Initial
  Issuance; Procedure for Increasing the VFN Collateral Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 3.4

  	
  Procedure
  for Decreasing the VFN Collateral Amount

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV

  	
  PAYMENTS AND ALLOCATIONS

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SECTION 4.1

  	
  Interest

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 4.2

  	
  Series
  Accounts; Series 2004-2 Distribution Account

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 4.3

  	
  Daily
  Calculations and Series Allocations

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 4.4

  	
  Daily
  Allocations of Series Collections

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 4.5

  	
  Withdrawals
  from the Excess Funding Account

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 4.6

  	
  Determination
  of Principal to be Distributed with respect to Series 2004-2

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 4.7

  	
  Available
  Overcollateralization

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 4.8

  	
  Write-Offs and Recoveries

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 4.9

  	
  Certain
  Dilution in a Series 2004-2 Amortization Period

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V

  	
  DISTRIBUTIONS AND REPORTS

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SECTION 5.1

  	
  Distributions

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 5.2

  	
  Daily
  Reports, Monthly Reports and Other Information

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 5.3

  	
  Annual Tax Information

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 5.4

  	
  Periodic Perfection
  Certificate

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI

  	
  SERIES 2004-2 PAY-OUT
  EVENTS

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SECTION 6.1

  	
  Series 2004-2 Pay-Out
  Events

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 6.2

  	
  Early Amortization Period

  	
   

  
					



 


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  ARTICLE VII

  	
  MISCELLANEOUS

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SECTION 7.1

  	
  Amendments, Waivers, Etc

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 7.2

  	
  Indenture Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 7.3

  	
  Instructions in Writing

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 7.4

  	
  Rule 144A

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 7.5

  	
  Restrictions on Transfer

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  SECTION 7.6

  	
  Survival of Agreements

  	
   

  
					



 


ii





















 


EXHIBITS


 


	
  EXHIBIT
  A

  	
   

  	
  Form of Series 2004-2 Notes

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT
  B

  	
   

  	
  Form of Daily Report

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT
  C

  	
   

  	
  Form of Monthly Report

  	
   

  



 


iii





















 


This SERIES 2004-2 INDENTURE SUPPLEMENT,
dated as of November 23, 2004 (as amended, restated, supplemented or
otherwise modified from time to time, this “Indenture Supplement”),
is made between SSCE FUNDING, LLC,
as Issuer, and DEUTSCHE BANK TRUST COMPANY AMERICAS, as Indenture Trustee on
behalf of the Series 2004-2 Noteholders.


 


PRELIMINARY STATEMENT


 


Pursuant to the Master
Indenture, dated as of November 23, 2004 (the “Indenture”), between Issuer and
Indenture Trustee, Issuer may from time to time direct Indenture Trustee to
issue and authenticate, on behalf of Issuer, one or more Series of Notes.  Certain terms applicable to a new Series,
including the Principal Terms thereof, are to be set forth in an Indenture
Supplement. This Indenture Supplement is an “Indenture Supplement” as that term
is defined in the Indenture.


 


ARTICLE I



DEFINITIONS; INCORPORATION OF TERMS


 


SECTION 1.1                          Definitions.


 


(a) Capitalized
terms used and not otherwise defined herein are used as defined in Annex A to
the Indenture. This Indenture Supplement shall be interpreted in accordance
with the conventions set forth in Section 1.2 of the Indenture.


 


(b) Each
reference in this Indenture Supplement to funds on deposit in the Collection
Account refers only to funds in the administrative sub-accounts of those
accounts that are allocated to Series 2004-2. Unless the context otherwise
requires, in this Indenture Supplement: (i) each reference to a “Daily Report”
or “Monthly Report” refers to a Daily Report or Monthly Report for Series
2004-2; (ii) each reference to the “Servicing Fee” refers to the Servicing Fee
allocable to Series 2004-2; and (iii) each reference to the Transaction
Documents shall be deemed to include a reference to the Purchase Agreement (as
defined below).


 


(c) Each
capitalized term defined herein relates only to Series 2004-2 and to no other
Series.  Whenever used in this Indenture
Supplement, the following words and phrases shall have the following meanings:


 


“Accrual
Period” means, with respect to Series 2004-2, the period from and
including a Payment Date to but excluding the succeeding Payment Date; provided that in the case of the initial Accrual Period, it
shall mean the period from and including the Closing Date to but excluding December 15,
2004.


 


“Additional
Amounts” is defined in the Purchase Agreement.


 


“Adjusted Carrying Cost Reserve” at any time of
determination, means the product of (a) the Carrying Cost Receivables Reserve
at such time and (b) a fraction, the numerator of which is


 





















 


one (1.00), and
the denominator of which is the result of one (1.00) minus the VFN Applicable Reserve Ratio at such time.


 


“Agent”
means Société Générale,
in its capacity as agent for the Series 2004-2 Noteholders.


 


“Available
Overcollateralization” means, at any time, the amount then calculated
as such pursuant to Section 4.7.


 


“Average
Dilution Ratio” means, as at any Determination Date and continuing
until (but not including) the next Determination Date, the average of the
Dilution Ratios for the twelve (12) consecutive Settlement Periods ending
immediately prior to such Determination Date.


 


“B&H
Measurement Date” means, for any calendar year, a date, which shall
be selected by the Servicer, falling within the month of December during
such calendar year.


 


“B&H
Ratio” means, for any calendar year, a fraction (expressed as a
percentage), (a) the numerator of which is aggregate of the Unpaid Balances of
all Transferred Receivables which have been billed, but for which the delivery
of the goods or merchandise or the rendering of the services giving rise to
such Transferred Receivable has not been completed, as of the applicable
B&H Measurement Date and (b) the denominator of which is the Aggregate
Receivables Balance as of the applicable B&H Measurement Date.


 


“B&H
Reserve” means, at any date of determination, the product of (a) the
highest of the three most recently calculated B&H Ratios, times (b) 3.5, times (c) the
Aggregate Receivables Balance as of such date of determination.


 


“Carrying
Cost Receivables Reserve” means, on any Business Day in any
Settlement Period, the sum of:


 


(a) the
product of (i) the aggregate Outstanding Principal Balances of the Series
2004-2 Notes on such day, multiplied by (ii) the Carrying Cost Reserve Ratio; plus


 


(b) the
product of (i) the percentage equivalent of a fraction, the numerator of which
is the Outstanding Principal Balances of all Series 2004-2 Notes and the
denominator of which is the aggregate Outstanding Principal Balances of all
Notes of all Series on such day, multiplied by (ii) the aggregate Unpaid Balances of
Transferred Receivables on such day, multiplied by (iii) the Servicing
Reserve Ratio.


 


“Carrying
Cost Reserve Ratio” means, on any date of determination, the amount
as reflected in the most recent Monthly Report equal to (i) 1.5, multiplied by (ii) One-Month LIBOR plus
3.25%, multiplied
by (iii) a fraction, (x) the numerator of which is the product of
(A) 2.0 and (B) the Days Sales Outstanding and (y) the denominator of which is
360.


 


“Charged-Off
Amount” shall mean, with respect to any Settlement Period, the sum
of the amount of Transferred Receivables that were included in the Net Eligible
Receivables and that (i) became 121 to 150 days past due as of the last
Business Day of such Settlement Period or (ii)


 


2





















 


became Defaulted
Receivables during such Settlement Period prior to becoming 121 days past due.


 


“Closing Date”
with respect to Series 2004-2, means November 23, 2004.


 


“Daily Report”
is defined in Section 5.2(a).


 


“Decrease”
means, collectively, each Mandatory Decrease and each Voluntary Decrease.


 


“Default Ratio”
means, as
provided in the most recent Monthly Report, a fraction (expressed as a percentage) having (a) a
numerator equal to the Charged-Off Amount for the Settlement
Period ending on the last day of the Settlement Period preceding the
Determination Date on which such Monthly Report was required to be delivered,
and (b) a denominator equal to the
initial aggregate amount payable pursuant to invoices giving
rise to Transferred Receivables
that were generated during the fifth Settlement Period
immediately preceding the Settlement Period referred to in clause (a) above.


 


“Default
Ratio Average” means, with respect to any Settlement Period, the
average of the Default Ratios applicable to the Settlement Period then ended
and the two immediately preceding Settlement Periods.


 


“Dilution
Horizon Period” means, for each Seller, 60 days; provided, however, such period may be adjusted on an annual
basis upon satisfaction of the Rating Agency Condition following the delivery
of a credit memo sampling provided by the Servicer to the Rating Agencies.


 


“Dilution Horizon
Ratio” means, as of any Determination Date and continuing until (but
not including) the next Determination Date, a fraction (expressed as a
percentage) having (a) a numerator equal to the aggregate Unpaid Balances of
Transferred Receivables originated by the Sellers during the Dilution Horizon Period preceding
the last day of the Settlement Period immediately prior to such earlier Determination
Date and (b) a denominator equal to the Net Eligible Receivables as of the
last day of the Settlement Period immediately prior to such earlier
Determination Date.


 


“Dilution Ratio”
means, as provided in the most recent Monthly Report, a fraction (expressed as
a percentage) having (a) a numerator equal to the aggregate amount of Dilutive
Credits occurring during the Settlement Period ending on the last day of the
Settlement Period preceding the Determination Date on which such Monthly Report
was required to be delivered, and (b) a denominator equal to the aggregate
amounts payable pursuant to invoices giving rise to Transferred Receivables
that were generated by the Sellers
during the second Settlement Period immediately preceding the Settlement Period
referred to in clause (a).


 


“Dilution Reserve
Ratio” means, as provided in the most recent Monthly Report, the
amount (expressed as a percentage) that is calculated for the Series 2004-2
Notes, as follows:


 


3





















 


	
   

  	
  DRR

  	
  =

  	
  [(c
  * d) + [(e – d) * (e/d)]] * f

  
	
   

  	
   

  	
   

  	
   

  
	
  where:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  DRR

  	
  =

  	
  Dilution
  Reserve Ratio;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  a

  	
  =

  	
  the
  product of “g”, multiplied by “h”;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  b

  	
  =

  	
  the
  product of (1-”g”), multiplied by “i”;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  c

  	
  =

  	
  the
  sum of “a” plus “b”;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  d

  	
  =

  	
  the
  Average Dilution Ratio as of the Determination Date on which such Monthly
  Report was required to be delivered;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  e

  	
  =

  	
  the
  highest Dilution Ratio over the past twelve Settlement Periods immediately
  preceding the Determination Date referred to in “d”;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  f

  	
  =

  	
  the
  Dilution Horizon Ratio as of the Determination Date referred to in “d”;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  g

  	
  =

  	
  the
  fraction (expressed as a percentage), (x) the numerator of which is aggregate
  of the Unpaid Balances of all Transferred Receivables originated by the CBM division
  of Smurfit-Stone calculated as of the Determination Date referred to in “d”,
  and (y) the denominator of which is the Aggregate Receivables Balance
  calculated as of the Determination Date referred to in “d”;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  h

  	
  =

  	
  with
  respect to the Series 2004-2 Notes, 2.75; and

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  i

  	
  =

  	
  with
  respect to the Series 2004-2 Notes, 2.25.

  



 


“Distribution
Shortfall” means, on any Business Day:


 


(a) with
respect to Series 2004-2, that the funds available for allocation to the Series
Accounts for Series 2004-2 and the Excess Funding Account on such Business Day
pursuant to Section 4.4
are less than the amounts, if any, required to be deposited in such accounts on
such Business Day; and


 


(b) with
respect to any Series, that the funds available for allocation to a Series
Collection Subaccount on such Business Day pursuant to the Indenture Supplement
for such Series are less than the amounts, if any, required to be deposited in
such accounts on such Business Day pursuant to such Indenture Supplement.


 


“Early Amortization
Period” means the period beginning on the date specified therefor in
Section 6.2, and ending on the
earlier of (i) the day on which the Series 2004-2 Collateral Amount has been
reduced to zero and (ii) ending on the date after the date on which all amounts


 


4





















 


owing to the Agent
and the Series 2004-2 Noteholders by the Issuer under the Indenture, this
Indenture Supplement and the Purchase Agreement have been reduced to zero.


 


“Excess
Program Costs” has the meaning as assigned to such term within the
definition of “Program Costs”.


 


“Group 1” means a group of Series which
will include Series 2004-2 and each other Series specified in the related
Indenture Supplement to be included in Group 1.


 


“Increase”
is defined in Section 3.3(a).


 


“Initial Note
Principal Balance” means the initial outstanding principal amount of
the Series 2004-2 Notes, which is $60,000,000.


 


“Institutional
Accredited Investor” is defined in Section 7.5(a)(iii).


 


“Issuer Indemnified
Losses” is defined in Section 7.1.


 


“Issuer Indemnified
Party” is defined in Section 7.1.


 


“Legal Final Maturity”
means the Payment Date in November, 2010.


 


“London
Business Day” means any day on which dealings in deposits in United
States dollars are transacted in the London interbank market.


 


“Loss Reserve Ratio”
means, as provided in the most recent Monthly Report, the amount (expressed as
a percentage) that is calculated for the Series 2004-2 Notes, as follows:


 


	
   

  	
  LRR

  	
  =

  	
  d *
  b * (a/c) * PTM

  
	
   

  	
   

  	
   

  	
   

  
	
  Where:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  LRR

  	
  =

  	
  Loss
  Reserve Ratio;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  a

  	
  =

  	
  the
  aggregate Unpaid Balances of Transferred Receivables originated by the
  Sellers during the three Settlement Periods immediately preceding the
  Determination Date on which such Monthly Report was required to be delivered;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  b

  	
  =

  	
  the
  highest Default Ratio Average that occurred during the period of twelve
  consecutive Settlement Periods ending prior to the Determination Date
  referred to in “a”;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  c

  	
  =

  	
  the
  Net Eligible Receivables as of the last day of the Settlement Period
  immediately preceding the Determination Date referred to in “a”;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  d

  	
  =

  	
  with
  respect to the Series 2004-2 Notes, 2.25; and

  



 


5





















 


	
   

  	
  PTM

  	
  =

  	
  the
  Payment Term Multiplier as of the most recent Determination Date.

  



 


“Mandatory Decrease”
is defined in Section 3.4(a).


 


“Maximum
Principal Amount” equals $125,000,000, as such amount may be reduced
pursuant to and in accordance with the terms of the Purchase Agreement.


 


“Minimum
Reserve Ratio” means, as provided in the most recent Monthly Report,
the amount (expressed as a percentage) that is calculated for the Series 2004-2
Notes, as follows:


 


	
   

  	
  MRR

  	
  =

  	
  (the
  greater of (a * b) and c), plus d

  
	
   

  	
   

  	
   

  	
   

  
	
  Where:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  MRR

  	
  =

  	
  Minimum
  Reserve Ratio;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  a

  	
  =

  	
  the
  Average Dilution Ratio as of the Determination Date on which such Monthly
  Report was required to be delivered;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  b

  	
  =

  	
  the
  Dilution Horizon Ratio as of the Determination Date referred to in “a”;

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  c

  	
  =

  	
  the
  quotient (expressed as a percentage) of (i) the sum of the aggregate Unpaid
  Balances of all Eligible Receivables for the Top 3 Obligors, divided by (ii) the Net Eligible Receivables as of the
  Determination Date referred to in “a” above; and

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  d

  	
  =

  	
  with
  respect to the Series 2004-2 Notes, 10.0%.

  



 


“Minimum Transferor Percentage” for Series
2004-2, means zero.


 


“Monthly Report”
is defined in Section 5.2(a).


 


“Net
Recoveries” means, with respect to any OC Measuring Period, an
amount equal to the result of (a) the amount of Recoveries received in that OC
Measuring Period, minus (b) the Write-Off Amount
for that OC Measuring Period; provided that
the resulting amount calculated pursuant to this definition shall not be less
than zero.


 


“Noteholder”
means a Noteholder (as defined in the Indenture) of a Series 2004-2 Note.


 


“Notice of
Increase” is defined in the Purchase Agreement.


 


“One-Month LIBOR”
means, for any Accrual Period, the rate per annum, determined by Indenture
Trustee and notified in writing by Indenture Trustee to Servicer, which is the
arithmetic mean (rounded to the nearest 1/100 of 1%) of the offered rates for
dollar deposits having a maturity of one month commencing on the first day of
such Accrual Period that appears on the Telerate British Bankers Assoc.
Interest Settlement Rates Page (defined below) at


 


6





















 


approximately
11:00 a.m., London time on the second full London Business Day prior to such
date; provided,
however,
that if there shall at any time no longer exist a Telerate British Bankers Assoc.
Interest Settlement Rates Page, “One-Month LIBOR” shall be determined on the basis of the
rates at which deposits in United States dollars are offered by the Reference
Banks at approximately 11:00 a.m., London time, on that day to prime banks in
the London interbank market for a period of one-month.  The Indenture Trustee shall request the
principal London office of each of the Reference Banks to provide a quotation
of its rate.  If at least two (2) such
quotations are provided, the rate for that Accrual Period shall be the
arithmetic mean of the quotations.  If
fewer than two (2) quotations are provided as requested, the rate for that
Accrual Period will be the arithmetic mean of the rates quoted by major banks in
New York City, selected by the Servicer, at approximately 11:00 a.m., New York
City time, on that day for loans in United States dollars to leading European
banks for a period of one month.  As used
herein, “Telerate
British Bankers Assoc. Interest Settlement Rates Page” means the
display designated as Page 3750 on the Telerate System Incorporated Service (or
such other page as may replace such page on such service for the purpose of
displaying the rates at which dollar deposits are offered by leading banks in
the London interbank deposit market), as reported by Bloomberg Financial
Markets Commodities News (or by another source selected by Indenture Trustee
and notified by Indenture Trustee to Servicer).


 


“Outstanding Principal
Balance” means, on any date, with respect to the Series 2004-2 Notes,
the actual outstanding principal balance of the Series 2004-2 Notes, taking
into effect all Increases and Decreases and all other payments on account of
principal (but no other payments) with respect to the Series 2004-2 Notes made
on or prior to such date.


 


“Payment Date”
means the 15th day of each month (or if such day is not a Business
Day, the next succeeding Business Day), commencing December 15, 2004.


 


“Payment Term”
means with respect to any Receivable, the number of days between its invoice
date and its Due Date.


 


“Payment Term
Multiplier” means, with respect to each Determination Date, (a) 1.0,
if the Payment Term Variable is not more than 36, (b) 1.1., if the Payment Term
Variable is 37 to 39, (c) 1.17, if the Payment Term Variable is 40 to 45, (d)
1.22, if the Payment Term Variable is 46 to 50, (e) 1.28, if the Payment Term
Variable is 51 to 55, (f) 1.33, if the Payment Term Variable is 56 to 60, and
(g) 1.38, if the Payment Term Variable is 61 to 65; provided
however, that, if the Payment Term Variable exceeds 65, the Payment
Term Multiplier on such Determination Date shall be determined by calculating
the sum of (x) 1.38 and (y) 0.05, for each 5-day increment by which the Payment
Term Variable exceeds 65, it being understood that the same number shall apply
for all Payment Term Variables that fall within a five-day range.


 


“Payment Term
Variable” means, as calculated in each Monthly Report as of the most
recently ended Settlement Period, the weighted average of the Payment Terms of
all Transferred Receivables with an Unpaid Balance as of the last day of such
Settlement Period.


 


“Program
Costs” means, for any Business Day, the sum of (i) the product of
(A) all unpaid fees and expenses due and payable to counsel to, and independent
auditors of, the Issuer


 


7





















 


(other than fees
and expenses payable on or in connection with the closing of the issuance of
any Series) on such Business Day and (B) a fraction, the numerator of which is
the Series 2004-2 Collateral Amount as of the end of the immediately preceding
Business Day and the denominator of which is the sum of the Collateral Amounts
for all Series as of the end of the immediately preceding Business Day, (ii)
all unpaid fees and expenses due and payable to the Rating Agencies rating the
Series 2004-2 Notes and (iii) the product of (A) all unpaid fees and expenses
(including reasonable attorneys’ fees and expenses) due and payable to the
Indenture Trustee and (B) a fraction, the numerator of which is the Series
2004-2 Collateral Amount as of the end of the immediately preceding Business
Day and the denominator of which is the sum of the Collateral Amounts for all
Series as of the end of the immediately preceding Business Day, provided that Program Costs shall not exceed $100,000 in the
aggregate in any calendar year (any amount of the foregoing expenses,
indemnities and fees in excess of $100,000 shall be referred to herein as “Excess Program Costs”).


 


“Purchase Agreement”
means the Variable Funding Note Purchase Agreement, dated November 23,
2004, among the Issuer, Smurfit-Stone, the Agent and the Purchaser, as the same
may be amended, restated, modified or otherwise supplemented from time to
time.  The Purchase Agreement is hereby
designated a “Transaction Document”.


 


“Purchaser”
means Barton Capital LLC, together with its successors and permitted assigns
pursuant to the terms of the Purchase Agreement.


 


“Qualified
Institutional Buyer” is defined in Section 7.5(c).


 


“Rating Agency”
or “Rating
Agencies” for Series 2004-2, means S&P and Moody’s.


 


“Reference
Banks” means four major banks in the London interbank market
selected by the Servicer.


 


“Regulation S”
is defined in Section 7.5(a)(ii).


 


“Required
Amount” means, as calculated on each Business Day during an Accrual
Period with respect to the next Payment Date, the sum of (i) the Series 2004-2
Monthly Interest to be distributed on the next Payment Date, (ii) the aggregate
amount of all previously accrued and unpaid Series 2004-2 Monthly Interest for
prior Payment Dates, (iii) the Servicing Fee for Series 2004-2 and (iv) all
accrued and unpaid Program Costs and Additional Amounts, in each case for such
Accrual Period determined as of such day.


 


“Required
Overcollateralization Amount” means,


 


(a)                                  on
any date of determination during the Revolving Period, an amount equal to the
sum of:


 


(i)                                     an
amount equal to the product of (x) the Series 2004-2 Adjusted Collateral Amount
on such day and (y) a fraction, the numerator of which is the VFN Applicable
Reserve Ratio and the denominator of which is one minus the VFN Applicable
Reserve Ratio; plus


 


8





















 


(ii)                                  the
Adjusted Carrying Cost Reserve on such day; and


 


(b)
on any date of determination during the Series 2004-2 Amortization Period, an
amount equal to the Required Overcollateralization Amount on the Series 2004-2
Amortization Period Calculation Date.


 


“Required
Reserve Ratio” means, as provided in the most recent Monthly Report,
for the Series 2004-2 Notes, the sum of the Dilution Reserve Ratio and the Loss
Reserve Ratio for the Series 2004-2 Notes.


 


“Revolving Period”
means the period beginning on the Closing Date and ending on the day before the
first day of the Series 2004-2 Amortization Period.


 


“Rule 144A”
is defined in Section 7.5(a)(i).


 


“Scheduled Revolving
Period Termination Date” means September 14, 2009.


 


“Series
Accounts” with respect to Series 2004-2, is defined in Section 4.2.


 


“Series 2004-2”
is defined in Section 2.1.


 


“Series
2004-2 Adjusted Collateral Amount” means, as of any date of
determination, (i) the Series 2004-2 Collateral Amount on such date, minus (ii) the lesser of (x) the Series 2004-2 Collateral
Amount and (y) the sum of (A) the amount on deposit in the Series 2004-2
Principal Collection Sub-subaccount on such date, plus
(B) the Series 2004-2 Allocation Percentage of the amounts on deposit in the
Excess Funding Account on such date.


 


“Series
2004-2 Allocable Dilution” means, for any OC Measuring Period, the
product of (a) the aggregate amount of Dilution Payment Amounts required to be
made as a result of Dilutive Credits granted during such OC Measuring Period
and as to which no payment has been made by SRC pursuant to Section 2.3 of
the Transfer and Servicing Agreement and (b) the Series 2004-2 Loss Allocation
Percentage for that OC Measuring Period.


 


“Series 2004-2
Allocable Dilution Adjustments” means, for any OC Measuring Period,
the product of (a) the aggregate amount of payments pursuant to or in respect
of Section 2.3 of the Transfer and Servicing Agreement received during
that OC Measuring Period relating to Dilutive Credits that occurred prior to
that OC Measuring Period and (b) the Series 2004-2 Loss Allocation Percentage
for that OC Measuring Period.


 


“Series 2004-2
Allocable Recoveries” means, for any OC Measuring Period, the
product of (a) the Net Recoveries for that OC Measuring Period, and (b) the
Series 2004-2 Loss Allocation Percentage for that OC Measuring Period.


 


“Series 2004-2
Allocable Write-Off Amount” means, for any OC Measuring Period, the
product of (a) the Write-Off
Amount for that OC Measuring Period, and (b) the Series 2004-2 Loss Allocation
Percentage for that OC Measuring Period.


 


9





















 


“Series
2004-2 Allocated Receivables Amount” means, as of any date of
determination, the product of (a) the Net Eligible Receivables and (b) the
percentage equivalent of a fraction, the numerator of which is the Series
2004-2 Target Receivables Amount and the denominator of which is the Aggregate
Target Receivables Amount on such day.


 


“Series 2004-2
Allocation Percentage” for Series 2004-2 means, (a) for any
Business Day during the Revolving Period, a fraction (expressed as a
percentage), (i) the numerator of which is the lesser of the Series 2004-2
Allocated Receivables Amount and the Series 2004-2 Target Receivables Amount as
of the end of the immediately preceding Business Day and (ii) the denominator
of which is the greater of (A) the Net Eligible Receivables as of the end of
the immediately preceding Business Day and (B) the sum of the numerators used
to calculate the Allocation Percentages for all Outstanding Series of Notes on
the Business Day for which such percentage is determined, and (b) during the
Series 2004-2 Amortization Period, the percentage equivalent of a fraction, the
numerator of which is the lesser of the Series 2004-2 Allocated Receivables
Amount and the Series 2004-2 Target Receivables Amount, as of the Series 2004-2
Amortization Period Calculation Date and the denominator of which is the
greater of (A) the Net Eligible Receivables as of the end of the immediately
preceding Business Day and (B) the sum of the numerators used to calculate the
Allocation Percentages for all Outstanding Series on the Business Day for which
such percentage is determined.


 


“Series 2004-2
Amortization Period” means the period (a) beginning on the earliest
of (i) the Scheduled Revolving Period Termination Date, (ii) the date, if any,
on which an Early Amortization Period commences and (iii) the date that occurs
60 days after the date that the Agent and the Indenture Trustee receive written
notice from the Issuer (or the Servicer on behalf of the Issuer) of its
election to end the Revolving Period and (b) ending on the date after the date
on which all amounts owing to the Agent, the Series 2004-2 Noteholders and the
Indenture Trustee by the Issuer under the Indenture, this Indenture Supplement
and the Purchase Agreement have been reduced to zero.


 


“Series 2004-2
Amortization Period Calculation Date” means the day before the first day of the Series 2004-2
Amortization Period.


 


“Series
2004-2 Available Funds” is defined in Section 4.4.


 


“Series 2004-2
Collateral Amount” means, at any time, the VFN Collateral Amount.


 


“Series 2004-2
Collateral Amount Write-Offs” means, as calculated in any Monthly
Report relating to a Settlement Period falling completely or partially in the
Series 2004-2 Amortization Period:


 


(a)                                  if
the Available Overcollateralization is greater than zero for the related OC
Measuring Period, zero; and


 


(b)                                 if
the Available Overcollateralization is less than or equal to zero for the
related OC Measuring Period (taking into account any reduction in the Available
Overcollateralization shown in such Monthly Report), the excess (if any) of (i)
the result of (A) the Series 2004-2 Allocable Write-Off Amount, plus (B) the Series 2004-2


 


10





















 


Allocable
Dilution, minus (C) the Series 2004-2 Allocable
Recoveries, minus (D) the
Series 2004-2 Allocable Dilution Adjustments for the related OC Measuring
Period, over
(ii) the Available Overcollateralization for the immediately preceding OC
Measuring Period.


 


“Series
2004-2 Collection Subaccount” is defined in Section 4.2.


 


“Series 2004-2
Collections” is defined in Section 4.3.


 


“Series
2004-2 Excess Funding Account Deposit Amount” means, at any time,
the product of (a) a fraction, the numerator of which is the Series 2004-2
Collateral Amount as of the end of the immediately preceding Business Day, and
the denominator of which is the sum of the Collateral Amounts for all Series as
of the end of the immediately preceding Business Day, multiplied
by (b) the Excess Funding Account Deposit Amount, after giving
effect to any deposit to be made pursuant to Section 8.6 of the Indenture
on such date.


 


“Series 2004-2 Loss Allocation Percentage”
means, for any day in any OC Measuring Period, a fraction (expressed as a
percentage), (a) the numerator of which is the Series 2004-2 Collateral Amount
as of the last day of the preceding Settlement Period and (b) the denominator
of which is the greater of (i) the sum for all Series of Notes that are
Outstanding of the “Collateral Amount” as defined in the Indenture Supplements
for each such Series and (ii) the Net Eligible Receivables, in each case as of
the last day of the preceding Settlement Period.


 


“Series 2004-2 Monthly
Interest”
for any Accrual Period means the VFN Monthly Interest for such Settlement
Period.


 


“Series 2004-2 Monthly
Principal Amount”
for any Settlement Period means the VFN Monthly Principal for such Settlement
Period.


 


“Series 2004-2
Noteholder” means the Person in whose name a Series 2004-2 Note is
registered on the Note Register.


 


“Series
2004-2 Notes” is defined in Section 2.1.  Each Series 2004-2 Note shall be
substantially in the form of Exhibit A.


 


“Series
2004-2 Non-Principal Collection Sub-subaccount” is defined in Section 4.2.


 


“Series 2004-2 Pay-Out
Event” is defined in Section 6.1.


 


“Series
2004-2 Principal Collection Sub-subaccount” is defined in Section 4.2.


 


“Series
2004-2 Servicer Transfer Cost Allocation” means, for any Business
Day, the product of (a) a fraction, the numerator of which is the Series
2004-2Collateral Amount as of the end of the immediately preceding Business
Day, and the denominator of which is the sum of the Collateral Amounts for all
Series as of the end of the immediately preceding Business Day, multiplied by (b) the amount of Servicer Transfer Costs
payable from Collections pursuant to Section 7.1(b) of the Transfer and
Servicing Agreement.


 


11





















 


“Series
2004-2 Target Receivables Amount” means, on any date of
determination, the sum of (i) the Series 2004-2 Adjusted Collateral Amount on
such day and (ii) the Required Overcollateralization Amount on such day.


 


“Series 2004-2
Weighted Average Note Rate” means, at any date of determination, the
sum of (a) the VFN Note Rate in effect with regard to the Outstanding Series
2004-2 Notes, as of the end of the Settlement Period immediately preceding the
most recent Determination Date, plus (b) an
amount equal to (i) the aggregate amount of fees (other than the Servicing Fee
and Program Costs) accrued with respect to the Series 2004-2 Notes during the
Settlement Period immediately preceding the most recent Determination Date, divided by (ii) the average daily Outstanding Principal
Balance of the Series 2004-2 Notes during such Settlement Period.


 


“Servicing Fee”
shall mean, for any Settlement Period, an amount equal to one-twelfth of the
product of (a) 1.00% and (b) the Series 2004-2 Collateral Amount as of the last
day of the Settlement Period preceding such Payment Date; provided,
however, that with respect to the first
Payment Date, the Servicing Fee shall be pro rated for the actual number of days
in the period beginning on the Closing Date and ending on the last day of the
initial Settlement Period.


 


“Servicing
Reserve Ratio” means an amount (expressed as a percentage), provided
in the most recent Monthly Report,  equal
to (i) the product of (A) 1.00%, (B) 2.00, and (C) the Days Sales Outstanding, divided by (ii) 360.


 


“SSCE Credit
Agreement” means that certain Credit Agreement, dated as of November 1,
2004, among Smurfit-Stone Container Corporation, Smurfit-Stone Container
Enterprises, Inc., Smurfit-Stone Container Canada, Inc., the lenders from time
to time party thereto, JPMorgan Chase Bank, Deutsche Bank Trust Company
Americas and Deutsche Bank AG, as amended, supplemented or otherwise modified
from time to time.


 


“SSCE Credit
Agreement Default Event” means thirty (30) days has elapsed
following the occurrence of an “Event of Default” (under and as defined in the
SSCE Credit Agreement) and such event continues (after giving effect to any
applicable cure period, if any, and any requirement of knowledge or notice
thereunder).


 


“Unmatured Series
Pay-Out Event” means an event or condition that, upon the giving of
notice or the passage of time, would become a Series Pay-Out Event.


 


“VFN Applicable
Reserve Ratio” means, during any Settlement Period, the greater of
(a) the Minimum Reserve Ratio applicable to the Series 2004-2 Notes and (b) the
Required Reserve Ratio applicable to the Series 2004-2 Notes, each as
calculated in the Monthly Report required to be delivered on the Determination
Date in the immediately preceding Settlement Period.


 


“VFN Collateral Amount”
means, at any time, an amount equal to (a) the Initial Note Principal Balance, plus
(b) the aggregate amount of all Increases, minus (c) the aggregate
amount of all distributions that have been made to Series 2004-2 Noteholders on
account of principal (including, without limitation, any Decreases), minus
(d) the aggregate amount of reductions to the VFN Collateral Amount made
pursuant to Section 4.8 on or prior to such
time, plus (d) reinstatements of any such reductions in clause (c) of Section 4.8 on
or prior to such time.


 


12





















 


“VFN Monthly Interest” is defined in Section 4.1.


 


“VFN Monthly Principal” means, with respect
to any Payment Date, (a) if such Payment Date occurs during the Series 2004-2
Amortization Period, the amount necessary to reduce the Outstanding Principal
Balance of the Series 2004-2 Notes to zero and (b) at any other time,
zero.  At no time shall the VFN Monthly
Principal exceed the VFN Collateral Amount at such time.


 


“VFN Note Rate” means (a) to the
extent any Purchaser is funding such Increase during such period through the
issuance of Commercial Paper (as defined in the Purchase Agreement), the CP
Rate (as defined in the Purchase Agreement), (b) to the extent any Purchaser is
not funding such Increase during such period through the issuance of Commercial
Paper, a rate per annum equal to One-Month LIBOR, plus 1.25%; provided,
that if One-Month LIBOR quotations are not available, the VFN Note Rate shall
be the Base Rate (as defined in the Purchase Agreement); provided, further
that on any day after the occurrence and continuance of any Pay-Out Event or an
Event of Default, the VFN Note Rate shall be the rate set forth in clause (a)
or (b) above, as applicable, plus 2% per annum.


 


“Voluntary Decrease”
is defined in Section 3.4(b).


 


(d) All
references herein to “Transferred Receivables”, when used to refer to
Receivables originated at any time prior to the Closing Date, shall mean all
Receivables other than Excluded Receivables, provided that Receivables
originated by the Containerboard Marketing division of the entity formerly
known as Jefferson Smurfit Corporation (U.S.) shall not be considered Excluded
Receivables solely when used to refer to Receivables originated at any time
prior to the Closing Date.


 


SECTION 1.2                          Incorporation of Terms.  The terms of the Indenture are incorporated
in this Indenture Supplement as if set forth in full herein. As supplemented by
this Indenture Supplement, the Indenture is in all respects ratified and
confirmed and both together shall be read, taken and construed as one and the
same agreement. If the terms of this Indenture Supplement and the terms of the
Indenture conflict, the terms of this Indenture Supplement shall control with
respect to the Series 2004-2 Notes.


 


ARTICLE II



DESIGNATION; AUTHENTICATION AND DELIVERY


 


SECTION 2.1                          Designation.  There is hereby created a Series to be known
as “Series
2004-2” or the “Series 2004-2 Notes,” consisting of one class:  the Variable Funding Notes, Series 2004-2
(the “Series 2004-2 Notes”).  Series 2004-2 shall be included in Group
1.  Series 2004-2 will not initially be a
Paired Series.  The Series 2004-2 Notes
will be issued in definitive form. 
Series 2004-2 will not be subordinated to any other Series. The Series
2004-2 Notes will be due and payable on the Legal Final Maturity.


 


13





















 


SECTION 2.2                          Authentication and Delivery.


 


(a) On
the Closing Date, the Issuer shall sign, and shall direct the Indenture Trustee
in writing pursuant to Section 2.2 of the Indenture to duly authenticate, and
the Indenture Trustee, upon receiving such direction, (i) shall authenticate,
subject to Section 3.1,
the Series 2004-2 Notes in accordance with such written directions, and (ii)
subject to Section 2.2(b),
shall deliver the Series 2004-2 Notes to the Agent on behalf of the Purchaser.


 


(b) The
Series 2004-2 Notes shall be issued in definitive form, in the name of the
initial Series 2004-2 Noteholder.


 


(c) The
Series 2004-2 Notes issued hereunder, as provided in Section 2.12
of the Indenture, shall be typewritten, printed, lithographed or
engraved or produced by any combination of these methods (with or without steel
engraved borders), all as determined by the officers executing such Notes, as
evidenced by their execution of such Notes.


 


(d) The
Series 2004-2 Notes shall be executed by manual or facsimile signature on
behalf of the Issuer by any Authorized Officer of the Issuer.


 


(e) The
Series 2004-2 Notes shall be issued in minimum denominations of $1,000,000 and in integral multiples of $100,000 in
excess thereof.


 


ARTICLE III



CONDITIONS TO ISSUANCE; USE OF PROCEEDS


 


SECTION 3.1                          Conditions to Initial Issuance.  The Indenture Trustee shall not authenticate
the Series 2004-2 Notes unless (i) all conditions to the issuance of the Series
2004-2 Notes under Section 2.8 of the Indenture shall have been
satisfied, and (ii) the Servicer shall have delivered an Officer’s Certificate
to the Indenture Trustee and the Agent to the effect that all conditions set
forth in Article IV of the Purchase Agreement shall have been satisfied.


 


SECTION 3.2                          Use of Proceeds.  The Issuer shall ensure that the net funds
made available to the Issuer from the issuance of the Series 2004-2 Notes shall
be used by the Issuer to purchase Receivables from Transferor pursuant to the
Transfer and Servicing Agreement.  The
Transferor shall use the purchase price for such Receivables to purchase
Receivables from the Seller pursuant to the Sale Agreement.  The Seller, in turn, shall use the purchase
price for such Receivables to repurchase Receivables from Jefferson Smurfit
Finance Corporation and Stone Receivables Corporation.  Jefferson Smurfit Finance Corporation and Stone
Receivables Corporation, in turn, shall use the purchase price for such
Receivables to repurchase the Series 1999-1 and Series 1999-2 Certificates
issued by the Stone Receivables Corporation Master Trust and terminate such
Trust and to repay all commercial paper notes issued by Jefferson Smurfit
Finance Corporation and to terminate the related Liquidity Agreement and other
related program documents.


 


14





















 


SECTION 3.3                          Initial
Issuance; Procedure for Increasing the VFN Collateral Amount.


 


(a)                                  (i)
On the Closing Date, the Issuer will issue and, subject to receipt of the
Officer’s Certificate set forth in Section 3.1,
the Indenture Trustee shall authenticate, the Series 2004-2 Notes in accordance
with the terms and provisions of the Indenture in the aggregate initial
principal amount equal to the Initial Note Principal Balance and a maximum
principal amount equal to the Maximum Principal Amount and (ii) on any Business
Day during the Revolving Period, the Issuer may, subject to the satisfaction of
each of conditions set forth in clause (b),
increase the VFN Collateral Amount (each such increase referred to as an “Increase”), upon delivery of a Notice of
Increase to the Indenture Trustee and the Agent received by each such Person
prior to 10:00 a.m. (Central Standard time) on such Business Day.


 


(b)                                 The
VFN Collateral Amount may be increased on any Business Day during the Revolving
Period pursuant to subsection (a)
above, only upon satisfaction of each of the following conditions with respect
to each proposed Increase:


 


(i)                                     The
amount of each Increase shall be equal to or greater than $250,000 (and in integral multiples of $100,000 in
excess thereof);


 


(ii)                                  After
giving effect to such Increase, the Outstanding Principal Balance shall not
exceed the Maximum Principal Amount;


 


(iii)                               Immediately
prior to and after giving effect to such Increase, the Series 2004-2 Allocated
Receivables Amount shall equal or exceed the Series 2004-2 Target Receivables
Amount;


 


(iv)                              All
of the conditions precedent to such Increase set forth in Article II of
the Purchase Agreement shall have been satisfied;


 


(v)                                 Such
Increase and the application of the proceeds thereof shall not result in the
occurrence of (1) a Pay-Out Event for any Series, a Servicer Default or an
Event of Default, or (2) an event or occurrence, which, with the passing of
time or the giving of notice thereof, or both, would become a Pay-Out Event for
any Series, a Servicer Default or an Event of Default; and


 


(vi)                              Immediately
prior to giving effect to any Increase, the Series 2004-2 Notes shall be rated
the same ratings as assigned by each Rating Agency to the Series 2004-2 Notes
on the Closing Date and as set forth in the Purchase Agreement.


 


(c)                                  Upon
receipt of the proceeds of such Increase by or on behalf of the Issuer, a duly
authorized officer of the Agent shall make appropriate notations on the grid
attached to the Series 2004-2 Notes or on its books and records of the amount
of such adjustment to the VFN Collateral Amount, and each of the Issuer, the
Series 2004-2 Noteholders and the Servicer hereby authorizes each duly
authorized officer of the Agent to make such notations on the Series 2004-2
Notes and on its books and records as aforesaid; provided, that
failure to make any such recordation on such grid or in its internal books and
records or any error in such grid or in its internal books and records shall
not adversely affect the Series 2004-2 Noteholders’ rights with respect to
their right to receive payments in respect of the Outstanding Principal
Balance;


 


15





















 


provided, further, that any failure by such
officer of the Agent to make any such notation shall not affect the obligations
of the Issuer under the Series 2004-2 Notes.


 


(d)                                 The
Issuer shall not issue additional Notes of this Series.  For this purpose, neither an Increase
pursuant to subsection (b) above
nor an amendment to this Indenture Supplement to increase the Maximum Principal
Amount shall constitute the issuance of additional Notes.


 


SECTION 3.4                          Procedure for Decreasing the VFN Collateral Amount.


 


(a)                                  Mandatory Decrease.  Without limiting any of the terms and
provisions hereof, if on any date, the Series 2004-2 Allocated Receivables
Amount is less than the Series 2004-2 Target Receivables Amount as of such
date, then, within three (3) Business Days, the Issuer shall pay or cause to be
paid to the Series 2004-2 Noteholders from Series 2004-2 Available Funds
available for payments of principal in accordance with Section 4.4
or amounts otherwise available to the Issuer, a principal payment to decrease
the VFN Collateral Amount by the amount necessary, so that after giving effect
to all Decreases of the VFN Collateral Amount, the Series 2004-2 Allocated
Receivables Amount shall be greater than or equal to the Series 2004-2 Target
Receivables Amount (each such reduction of the VFN Collateral Amount pursuant
to this Section 3.4(a), a “Mandatory Decrease”).  By 10:00 a.m. (Central Standard time) on the
Business Day of payment of such Mandatory Decrease, the Servicer, on behalf of
the Issuer, shall provide written notice thereof to the Indenture Trustee and
the Agent.


 


(b)                                 Voluntary Decrease.  The Issuer may on any Business Day, upon
written notice to the Indenture Trustee and the Agent, which such notice must
be received by each such Person prior to 10:00 a.m. (Central Standard time) on
such Business Day, decrease the VFN Collateral Amount (each such decrease of
the VFN Collateral Amount pursuant to this Section 3.4(b),
a “Voluntary Decrease”) by paying or
causing to be paid to the Series 2004-2 Noteholders from Series 2004-2
Available Funds available for payments of principal in accordance with Section 4.4 or amounts otherwise available to the
Issuer, a principal payment equal to the amount of such Decrease.  Each such Voluntary Decrease shall be in a
minimum principal amount of $250,000 (and in
integral multiples of $100,000 in excess thereof).  Upon such Voluntary Decrease, the Servicer,
on behalf of the Issuer shall reflect such Decrease in the Monthly Report.


 


(c)                                  Principal Amortization.  During the Series 2004-2 Amortization Period,
principal will be allocated to the VFN Collateral Amount and paid to the Series
2004-2 Noteholders in accordance with Section 5.1.


 


(d)                                 Upon
each Decrease and each other payment of principal pursuant to Sections 4.4 and 5.1, a duly
authorized officer of the Agent shall make appropriate notations on the grid
attached to the Series 2004-2 Notes or on its books and records of the amount
of such adjustment to the VFN Collateral Amount, and each of the Issuer, the
Series 2004-2 Noteholders and the Servicer hereby authorizes each duly
authorized officer of the Agent to make such notations on the Series 2004-2
Notes and on its books and records as aforesaid; provided, that
failure to make any such recordation on such grid or in its internal books and
records or any error in such grid or in its internal books and records shall
not adversely affect the Series 2004-2 Noteholders’ rights with respect to
their right to receive payments in respect of the Outstanding Principal
Balance;


 


16





















 


provided, further, that any failure by
such officer of the Agent to make any such notation shall not affect the obligations
of the Issuer under the Series 2004-2 Notes.


 


ARTICLE IV



PAYMENTS AND ALLOCATIONS


 


SECTION 4.1                          Interest.


 


(a)  Interest (“VFN Monthly Interest”) on the Series 2004-2 Notes shall (i)
accrue during each Accrual Period at the VFN Note Rate, (ii) be calculated on
the basis of actual days over a year of 360 days, (iii) be due and payable on
each Payment Date and (iv) be calculated based on the average of the daily
Outstanding Principal Balance of the Series 2004-2 Notes during such Accrual
Period (after giving effect to any distributions of principal on each date).


 


(b)  The Servicer shall calculate
the VFN Monthly Interest in accordance with this Section 4.1
based on the applicable VFN Note Rate. 
Prior to each Payment Date, the Indenture Trustee shall review the
Servicer’s calculation of the VFN Monthly Interest (relying on the VFN Note
Rate reported in the related Monthly Report or directly by the Agent to the
Indenture Trustee) and report any discrepancy to the Servicer, and, with the
Servicer, shall resolve such discrepancy.


 


SECTION 4.2                          Series Accounts;
Series 2004-2 Distribution Account.


 


(a)  The Indenture Trustee shall
cause to be established and maintained in the name of the Indenture Trustee,
(i) for the benefit of the Series 2004-2 Noteholders and (ii) in the case of clauses (A) and (B) below, for
the benefit, subject to the prior and senior interests of the Series 2004-2
Noteholders, of the holder of the Transferor Interest, (A) a subaccount of the
Collection Account (the “Series 2004-2 Collection
Subaccount”), which subaccount is the Series Collection Subaccount
with respect to Series 2004-2; and (B) two subaccounts of the Series 2004-2
Collection Subaccount: (1) the Series 2004-2 Principal Collection
Sub-subaccount and (2) the Series 2004-2 Non-Principal Collection
Sub-subaccount (respectively, the “Series 2004-2 Principal
Collection Sub-subaccount” and the “Series
2004-2 Non-Principal Collection Sub-subaccount”; all accounts
established pursuant to this subsection (a),
collectively, the “Series Accounts”
for Series 2004-2), each Series Account to bear a designation indicating that
the funds deposited therein are held for the benefit of the Persons (and, for
each such Person, to the extent) set forth in clauses (i) and
(ii) above and to otherwise be
maintained in accordance with the terms hereof and of the Indenture (including Sections 8.2 and 8.3 thereof).


 


(b) All Permitted Investments in the Series Accounts shall be invested,
subject to Section 8.3 of the Indenture,
together with funds held in other Sub-subaccounts of the Collection
Account.  After giving effect to any
distribution to the holder of the Transferor Interest pursuant to Section 8.6(f) of the Indenture, amounts on deposit and
available for investment in the Series 2004-2 Principal Collection
Sub-subaccount shall be invested by the Indenture Trustee at the written
direction of the Servicer in Permitted Investments that mature, or that are
payable or redeemable upon demand of the holder thereof, (i) in the case of any
such investment made


 


17





















 


during
the Revolving Period, on or prior to the next Business Day and (ii) in the case
of any such investment made during the Series 2004-2 Amortization Period, on or
prior to the Business Day immediately preceding the next Payment Date.  Amounts on deposit and available for
investment in the Series 2004-2 Non-Principal Collection Sub-subaccount shall
be invested by the Indenture Trustee at the written direction of the Servicer
in Permitted Investments that mature, or that are payable or redeemable upon
demand of the holder thereof, on or prior to the Business Day immediately
preceding the next Payment Date.  As of
the Business Day immediately preceding each Payment Date, all interest and
other investment earnings (net of losses and investment expenses) on funds
deposited in the Series 2004-2 Principal Collection Sub-subaccount shall be
deposited in the Series 2004-2 Non-Principal Collection Sub-subaccount.  Absent its receipt of timely investment
instructions, the Indenture Trustee shall have no obligation to make any
investment and funds shall remain uninvested.


 


SECTION 4.3                          Daily Calculations and Series Allocations.


 


(a) On
each Business Day, the Servicer shall calculate the Series 2004-2 Allocation Percentage,
the Series 2004-2 Allocated Receivables Amount and the Series 2004-2 Target
Receivables Amount.


 


(b) The
funds allocated to Series 2004-2 in accordance with Section 8.6
of the Indenture are called the “Series 2004-2 Collections.”


 


SECTION 4.4                          Daily Allocations of Series Collections.  On each Business Day, the Servicer shall, (a)
determine the sum of (i) the aggregate amount of Series 2004-2 Collections for
such Business Day, and (ii) the amount of funds then available on account of a
Distribution Shortfall (with respect to Series 2004-2) pursuant to the
Indenture Supplements for any other Series in Group 1 to the extent needed to
fund the items described in priorities first and  second below, in the priority
indicated, (collectively, “Series 2004-2 Available
Funds”), (b) indicate the amount of Series 2004-2 Available Funds in
the Daily Report delivered on such Business Day (whether or not a Payment Date)
and (c) direct the Indenture Trustee in the Daily Report to, and upon receipt
of such Daily Report, the Indenture Trustee shall, in reliance on such
instructions and without any independent verification, distribute such Series
2004-2 Available Funds as follows:


 


first, an amount of Series 2004-2 Available
Funds for such Business Day up to the amount necessary to cause the Required
Amount for such day to be on deposit therein, shall be transferred by the
Indenture Trustee from the Series 2004-2 Collection Subaccount to the Series
2004-2 Non-Principal Collection Sub-subaccount;


 


second, following the transfers pursuant to clause first above, any remaining Series 2004-2 Available
Funds shall be transferred by the Indenture Trustee to the Series 2004-2
Principal Collection Sub-subaccount for distribution (in the following
priority):


 


(u)                                 an
amount equal to the lesser of (A) the Series 2004-2 Servicer Transfer Cost
Allocation, if any, on such Business Day and (B) the amount of funds available


 


18





















 


pursuant to this clause second shall
be held in the Series 2004-2 Principal Collection Sub-subaccount for
distribution on the next Payment Date in accordance with Section 5.1;


 


(v)                                 an
amount equal to the lesser of (A) the aggregate amount of all Decreases
pursuant to Section 3.4, and (B) the amount of
funds remaining on deposit in the Series 2004-2 Principal Collection
Sub-subaccount that has not been allocated pursuant to subclause
(u) of this clause second,
for distribution to the Series 2004-2 Noteholders;


 


(w)                               an
amount equal to lesser of (A) the Series 2004-2 Monthly Principal Amount, if
any, on such Business Day, and (B) the amount of funds remaining on deposit in
the Series 2004-2 Principal Collection Sub-subaccount that has not been
allocated pursuant to subclause (u)
of this clause second, shall be held in the
Series 2004-2 Principal Collection Sub-subaccount for distribution in
accordance with Section 5.1 on each Payment
Date during the Series 2004-2 Amortization Period;


 


(x)                                   an
amount equal to the lesser of (A) the Series 2004-2 Excess Funding Account
Deposit Amount, if any, and (B) the amount remaining on deposit in the Series
2004-2 Principal Collection Sub-subaccount that has not been allocated pursuant
to subclauses (u) or (w) of this clause second, shall be deposited in the Excess Funding
Account;


 


(y)                                 an
amount equal to the lesser of (A) unpaid Excess Program Costs at such time and
(B) the amount remaining on deposit in the Series 2004-2 Principal Collection
Sub-subaccount that has not been allocated pursuant to subclauses
(u) or (w) of this clause second,
shall be held in the Series 2004-2 Principal Collection Sub-subaccount for
distribution on the next Payment Date in accordance with Section 5.1;


 


(z)                                   if
there is a Distribution Shortfall with respect to any Series (other than Series
2004-2) in Group 1 on such Business Day an amount equal to the lesser of
(A) the amount of such Distribution Shortfall and (B) the amount remaining
on deposit in the Series 2004-2 Principal Collection Sub-subaccount that has
not been allocated pursuant to subclauses (u), (w) or (y)
of this clause second, shall be transferred to
the Indenture Trustee, for distribution to the applicable accounts or Persons
specified in the Indenture Supplement with respect to such Series, it being
understood that if the Distribution Shortfalls for all Series (other than
Series 2004-2) in Group 1 exceed the amount of funds available pursuant to this
clause second, then such funds shall be
allocated to such Series pro  rata based on their respective
Distribution Shortfalls; and


 


third, the remainder of the Series 2004-2
Available Funds shall be distributed to the holder of the Transferor Interest.


 


SECTION 4.5                          Withdrawals from the Excess Funding Account.  On the first day of the Series 2004-2
Amortization Period, the Servicer shall instruct the Indenture Trustee to
transfer (and the Indenture Trustee shall transfer) the Series 2004-2
Allocation Percentage of the entire balance in the Excess Funding Account to
the Series 2004-2 Principal Collection Sub-subaccount.


 


19





















 


SECTION 4.6                          Determination of Principal to be Distributed with
respect to Series 2004-2. 
The amount of principal distributable on any Payment Date with respect
to the Series 2004-2 Notes shall be determined by the Servicer and set forth on
each Monthly Report.  On each Payment
Date during the Series 2004-2 Amortization Period, an amount equal to the
Series 2004-2 Monthly Principal shall be distributable from the Series 2004-2 Principal
Collection Sub-subaccount with respect to the Series 2004-2 Notes up to the
amount on deposit in such account on the immediately preceding Determination
Date; provided, however,
distributions of such principal shall be in accordance with Section 5.1.


 


SECTION 4.7                          Available
Overcollateralization. 



 


(a) If
a Series 2004-2 Amortization Period begins, the Servicer shall calculate the
Available Overcollateralization as of the Series 2004-2 Amortization Period
Calculation Date and report such amount in the Daily Report for the first
Business Day in the Series 2004-2 Amortization Period.  The Servicer shall also calculate the
Available Overcollateralization as of each Determination Date falling in the
Series 2004-2 Amortization Period, such calculation to be reflected in the
related Monthly Report.


 


(b) The
Available Overcollateralization as of the Series 2004-2 Amortization Period
Calculation Date shall equal the result of:


 


(i) the
Series 2004-2 Allocated Receivables Amount as of the opening of business of the
Series 2004-2 Amortization Period Calculation Date; minus


 


(ii) the
sum of (A) the lesser of (x) the excess of the Series 2004-2 Allocated
Receivables Amount over the Required Overcollateralization Amount and (y) the
Series 2004-2 Collateral Amount and (B) the Adjusted Carrying Cost Reserve, in
each case, at the opening of business on the Series 2004-2 Amortization Period
Calculation Date.


 


(c) The
Available Overcollateralization, as of any Determination Date in the Series
2004-2 Amortization Period, shall equal the result of:


 


(i) the
Available Overcollateralization as of the preceding Determination Date (or as
of the Series 2004-2 Amortization Period Calculation Date, in the case of the
first Determination Date falling in the Series 2004-2 Amortization Period); minus


 


(ii) the
Series 2004-2 Allocable Write-Off Amount with respect to the OC Measuring
Period most recently ended prior to that Determination Date; minus


 


(iii) the
Series 2004-2 Allocable Dilution with respect to the OC Measuring Period most
recently ended prior to that Determination; plus


 


(iv) subject
to Section 4.8,
the Series 2004-2 Allocable Recoveries and the Series 2004-2 Allocable Dilution
Adjustments with respect to the OC Measuring Period prior to that Determination
Date.


 


20





















 


(d) Notwithstanding
the foregoing, in no event shall the Available Overcollateralization at any
time be less than zero and in no event shall the Available
Overcollateralization at any time during the Series 2004-2 Amortization Period
be greater than the Available Overcollateralization calculated for the first
Determination Date falling in the Series 2004-2 Amortization Period pursuant to
subsection (c) (other than as a result of Recoveries).


 


SECTION 4.8                          Write-Offs and
Recoveries.  


 


(a) In
each Monthly Report required to be delivered during the Series 2004-2
Amortization Period, the Servicer shall calculate the Series 2004-2 Collateral
Amount Write-Offs and the Series 2004-2 Allocable Recoveries for the most recently
ended OC Measuring Period.


 


(b) If
the Series 2004-2 Collateral Amount Write-Offs calculated in any Monthly Report
exceed zero, the Series 2004-2 Collateral Amount shall be reduced by the amount
of the Series 2004-2 Collateral Amount Write-Offs with effect from the related
Determination Date, subject to the next sentence.  Any such reduction shall be allocated to the
VFN Collateral Amount until the VFN Collateral Amount has been reduced to zero.


 


(c) If
the Series 2004-2 Collateral Amount has been reduced on account of any Series
2004-2 Collateral Amount Write-Offs, then any Series 2004-2 Allocable
Recoveries with respect to any Settlement Period ending after the reduction
takes place shall be applied to reinstate the Series 2004-2 Collateral Amount, to
the extent of such prior reductions that have not previously been reinstated,
with effect from the related Determination Date.  Any such reinstatement shall be allocated to
the VFN Collateral Amount until all prior reductions to the VFN Collateral
Amount on account of Series 2004-2 Collateral Amount Write-Offs have been
reinstated.


 


(d) If
Series 2004-2 Allocable Recoveries are applied pursuant to subsection (c) to
reinstate the Series 2004-2 Collateral Amount on any Payment Date, then Series
2004-2 Allocable Recoveries shall be applied to increase the Available
Overcollateralization on the related Determination Date only to the extent of
the excess, if any, of the Series 2004-2 Allocable Recoveries, minus the
amount of Allocable Recoveries so applied.


 


SECTION 4.9                          Certain Dilution in a Series 2004-2 Amortization
Period.  


 


(a) In
each Monthly Report required to be delivered during the Series 2004-2
Amortization Period, the Servicer shall calculate the Series 2004-2 Allocable
Dilution and the Series 2004-2 Allocable Dilution Adjustments for the most
recently ended OC Measuring Period.


 


(b) If
the Available Overcollateralization or the Series 2004-2 Collateral Amount has
been reduced on account of any Series 2004-2 Allocable Dilution, then any
Series 2004-2 Allocable Dilution Adjustments with respect to any OC Measuring
Period ending after the reduction takes place shall be allocated (x) first, to reinstate the Series 2004-2


 


21





















 


Collateral Amount,
and (y) second, to reinstate the Available
Overcollateralization, in each case to the extent not previously
reinstated.  Any funds so allocated on
any day shall be distributed in accordance with the priorities set forth in Section 4.4.


 


ARTICLE V



DISTRIBUTIONS AND REPORTS


 


SECTION 5.1                          Distributions.  (a) On each Payment Date, the Indenture
Trustee shall distribute (based solely on information provided in the
applicable Monthly Report and, subject to Section 4.1(b),
without any independent review or verification of such information) funds on
deposit in the Series 2004-2 Non-Principal Collection Sub-subaccount in the
following priority to the extent funds are available:


 


first, to the Servicer, the Servicing Fee for
the preceding Settlement Period;


 


second, to the Series 2004-2 Noteholders, an
amount equal to VFN Monthly Interest for such Payment Date, plus the amount of any VFN Monthly Interest previously due
but not distributed to the Series 2004-2 Noteholders on a prior Payment Date;


 


third, to the Series 2004-2 Noteholders, an
amount equal to Additional Amounts for such Payment Date (together with all
Additional Amounts previously due but not distributed to the Series 2004-2
Noteholders on a prior Payment Date) but only to the extent that amounts have
been set aside pursuant to clause first of Section 4.4;


 


fourth, to the Indenture Trustee, any unpaid
Program Costs for the preceding Settlement Period; provided that amounts
payable pursuant to this clause fourth shall
not exceed $50,000 during any calendar year;


 


fifth, to the applicable payees (including the
Indenture Trustee), pro rata, any
unpaid Program Costs for the preceding Settlement Period, to the extent not
paid pursuant to clause fourth above; and


 


sixth, if such Payment Date is during the
Series 2004-2 Amortization Period, to the Series 2004-2 Principal Collection
Sub-subaccount, any remaining funds.


 


To the extent that there are funds remaining in the Series 2004-2
Non-Principal Collection Sub-subaccount after the distribution of funds on
deposit therein as set forth above in this Section 5.1(a),
the Indenture Trustee shall deposit an amount equal to the Excess Funding
Account Deposit Amount, if any, to the Excess Funding Account, and any
remaining funds shall be paid to the holder of the Transferor Interest.


 


(b) On
each Payment Date, the Indenture Trustee shall distribute (based solely on the
information provided in the applicable Monthly Report), funds on deposit in the
Series 2004-2 Principal Collection Sub-subaccount in the following order of
priority to the extent funds are available:


 


22





















 


first, if any amounts are owed to the
Indenture Trustee, on account of Servicer Transfer Costs to the Indenture
Trustee an amount equal to the Series 2004-2 Servicer Transfer Cost Allocation;


 


second,
an amount equal to the Series 2004-2 Monthly Principal Amount for such Payment
Date shall be distributed to the Series 2004-2 Noteholders until repayment in
full of the VFN Collateral Amount;


 


third, any unpaid Excess Program Costs for the
preceding Settlement Period shall be paid, pro rata, to
the applicable payees (including the Indenture Trustee); and


 


fourth, any remaining balance shall be paid to
the holder of the Transferor Interest.


 


(c) The
Indenture Trustee shall send distributions to each Series 2004-2 Noteholder on
each Payment Date by wire transfer of immediately available funds to an account
maintained by such Series 2004-2 Noteholder with a bank in the United States; provided
that such Noteholder notified the Indenture Trustee in writing as to such
account at least five Business Days
prior to such Payment Date (such notice to remain effective with respect to
such Noteholder until different instructions are received by the Indenture
Trustee).  Distributions to Series 2004-2
Noteholders which do not qualify under the preceding sentence shall be made by
check mailed to such Series 2004-2 Noteholders. 
All distributions to Series 2004-2 Noteholders shall be made on a pro rata basis (based on the Outstanding
Principal Balances of the Class A Notes). 
For purposes of distributions to Series 2004-2 Noteholders on a Payment
Date, the status of a Person as a Series 2004-2 Noteholder shall be determined
as of the preceding Record Date.


 


SECTION 5.2                          Daily Reports, Monthly Reports and Other
Information.


 


(a) A
report (the “Daily  Report”) shall be delivered by
the Servicer to Indenture Trustee on each Business Day and each such report
shall be substantially in the form set out in Exhibit B or in such other form
as may be consistent with the terms of this Indenture Supplement.  A report (the “Monthly Report”) shall be
delivered by the Servicer to Indenture Trustee on each Determination Date and
each such report shall be substantially in the form set out in Exhibit C
or in such other form as may be consistent with the terms of this Indenture
Supplement.  The Indenture Trustee shall
provide copies of each Monthly Report to the Agent and the Rating
Agencies.  Each Daily Report and Monthly
Report shall report the required information for all outstanding Series.


 


Without limiting the
preceding paragraph, at the written request of the Servicer, the Indenture
Trustee shall provide or make available electronically via its internet website
(or upon written request, by first class mail or facsimile) each Monthly Report
to the Persons referred to in the preceding paragraph; provided, however,
the Indenture Trustee shall have no obligation to provide such reports
described in this Section 5.2
until it has received the requisite information from the Servicer.


 


23





















 


If the Servicer so
requests that the Indenture Trustee provide or make available electronically
the Monthly Reports, the Indenture Trustee may make available to any Rating
Agency, the Agent, any Noteholder or Note Owner of a Series 2004-2 Note, via
the Indenture Trustee’s internet website or via e-mail to the Agent and each
Noteholder as requested by the Servicer, in writing, all Monthly Reports
available each month and, with the consent or at the direction of the holder of
the Transferor Interest, such other information regarding the Series 2004-2
Notes and/or the Collateral as the Indenture Trustee may have in its
possession, but only, with respect to the Indenture Trustee’s internet website,
with the use of a password provided by the Indenture Trustee or its agent to
such Person.  The Indenture Trustee will
make no representation or warranties as to the accuracy or completeness of such
documents and will assume no responsibility therefor.


 


In connection with
providing access to the Indenture Trustee’s interest website, the Indenture
Trustee may require registration and the acceptance of a disclaimer. The
Indenture Trustee shall not be liable for the dissemination of information in
accordance with this Section 5.2.


 


(b) Notwithstanding
any other provision of this Indenture Supplement:


 


(i) In
the event that a calculation or determination to be made with respect to
periods prior to the Closing Date refers to a Daily Report or Monthly Report,
such calculation or determination shall be made even though Daily Reports or
Monthly Reports were not required to be delivered pursuant to this Indenture
Supplement prior to the Closing Date.


 


(ii) This
Section 5.2 shall not limit the
obligation of the Servicer to make the allocations and calculations required by
this Indenture Supplement on a daily basis.


 


SECTION 5.3                          Annual Tax Information.  During January (and on or before January 31)
of each calendar year, the Indenture Trustee shall furnish or cause to be
furnished to the Agent and each Person who at any time during the preceding
calendar year was a Series 2004-2 Noteholder the information for the preceding
calendar year, or the applicable portion thereof during which the Person was a
Noteholder, as is required to be provided by an issuer of indebtedness under
the Code to the holders of the issuer’s indebtedness and such other customary
information as is necessary to enable such Noteholder to prepare their federal
income tax returns.  Notwithstanding
anything to the contrary contained in this Agreement, the Indenture Trustee
shall, to the extent required by applicable law, from time to time furnish to
the Agent and the appropriate Persons prior to the end of the period required
by applicable law, the information required to complete a Form 1099-INT.


 


SECTION 5.4                          Periodic Perfection Certificate.  Within one hundred five (105) days after the
end of each fiscal year of the Issuer, the Servicer, on behalf of the Issuer,
shall furnish or cause to be furnished to the Indenture Trustee and the Agent
an Officer’s Certificate setting forth a list of all changes in the name,
identity, corporate structure or jurisdiction of incorporation of the Issuer,
the Transferor or any Seller that have taken place since the date of the Officer’s


 


24





















 


Certificate
most recently delivered pursuant to this Section 5.4, or
indicating that no such events have taken place, and stating in each case what
filings of UCC financing statements, or amendments thereto, relating to the
Transaction Documents have been made in connection with each such event
(identifying the date and filing index numbers for each).  If any such new UCC financing statements are
filed, the Servicer shall cause the Indenture Trustee to be named as secured
party (in the case of any filing against the Issuer) or assignee of the secured
party (in the case of any filing against the Transferor or a Seller).  The Indenture Trustee shall be under no obligation
to file and prepare any financing or continuation statements or to take any
other action, such obligation being solely that of the Servicer.


 


ARTICLE VI



SERIES 2004-2 PAY-OUT EVENTS


 


SECTION 6.1                          Series 2004-2 Pay-Out Events.  Each of the following shall constitute a “Series 2004-2 Pay-Out Event”:


 


(a) The
occurrence of an Issuer Pay-Out Event.


 


(b) The
Series 2004-2 Allocated Receivables Amount shall be less than the Series 2004-2
Target Receivables Amount for any period of five (5) consecutive Business Days.


 


(c) The
failure (i) on the part of the Transferor, the Issuer or the Servicer to make
(x) any payment or deposit of principal or interest required by the terms of
the Indenture or this Indenture Supplement or the Transfer and Servicing
Agreement on or before three (3) Business Days after the date such payment or
deposit is required to be made or (y) any other payment or deposit required by
the Indenture or this Indenture Supplement or the Transfer and Servicing
Agreement on or before five (5) Business Days after
the date such other payment or deposit is required to be made; or (ii) on the
part of the Transferor or the Issuer to duly observe or perform in any material
respect any other covenants or agreements of the Transferor or the Issuer set
forth in the Indenture or this Indenture Supplement or the Transfer and
Servicing Agreement; or (iii) on the part of the Servicer to deliver the Daily
Report required on any Business Day pursuant to the Indenture or this Indenture
Supplement or the Transfer and Servicing Agreement; which failure with respect
to clause (ii), continues unremedied for
ten (10) days or, with respect to clause (iii)
continues unremedied for five (5) days, in each case after the date on which
written notice of such failure, requiring the same to be remedied, shall have
been given to the Transferor, the Issuer or the Servicer by the Indenture
Trustee, or to the Transferor and the Indenture Trustee by the Agent on behalf
of the Series 2004-2 Noteholders.


 


(d) Any
representation or warranty made by the Transferor or the Issuer in the
Indenture, this Indenture Supplement or the Transfer and Servicing Agreement,
or any information contained in a computer file, microfiche list or hard copy
list required to be delivered by the Transferor or the Issuer pursuant to the
Indenture, any Indenture Supplement or the Transfer and Servicing Agreement shall
prove to have been incorrect


 


25





















 


in any material
respect when made or when delivered, which continues to be incorrect in any
material respect for a period of sixty (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 or the Issuer by the Indenture Trustee, or to the
Transferor by the Indenture Trustee after receipt of notice from the Agent on
behalf of the Series 2004-2 Noteholders and as a result of which the interests
of the Series 2004-2 Noteholders are materially and adversely affected.


 


(e) The
occurrence of an SSCE Credit Agreement Default Event.


 


(f) Any
Rating Agency shall downgrade, suspend or withdraw the rating assigned by it on
the Closing Date to the Series 2004-2 Notes.


 


SECTION 6.2                          Early Amortization Period.  (a) If a Series 2004-2 Pay-Out Event
described in Section 6.1(b) occurs and
such deficiency in the Series 2004-2 Allocated Receivables Amount is not cured
within five (5) Business Days after the five (5) Business Day period specified
in Section 6.1(b), notwithstanding
such cure, the Early Amortization Period shall automatically commence at the
end of such additional five (5) Business Day period unless the Agent on behalf
of the Series 2004-2 Noteholders agrees in writing to waive the occurrence of
the Series 2004-2 Pay-Out Event described in Section 6.1(b)
and the commencement of the Early Amortization Period.  Notwithstanding the foregoing, the Agent on
behalf of the Series 2004-2 Noteholders may cause the commencement of the Early
Amortization Period prior to the end of the additional five (5) Business Day
period specified in the previous sentence by written notice delivered to the
Indenture Trustee if a Series 2004-2 Pay-Out Event described in Section 6.1(b) has occurred and is continuing.  Upon the occurrence of a Series 2004-2
Pay-Out Event described in Section 6.1(b),
the Indenture Trustee shall notify the Agent on behalf of the Series 2004-2
Noteholders of such event and shall review each Daily Report delivered
thereafter to determine whether the deficiency in the Series 2004-2 Allocated
Receivables Amount is reported to be cured within five (5) Business Days after
the five (5) Business Day period specified in Section 6.1(b).  If the deficiency in the Series 2004-2
Allocated Receivables Amount is not cured within five (5) Business Days after
the five (5) Business Day period specified in Section 6.1(b),
the Early Amortization Period shall automatically commence.


 


(b) Upon
the occurrence and continuance of any Series 2004-2 Pay-Out Event described in Section 6.1(a), the Early Amortization Period shall
commence immediately on the date of such occurrence without any notice or other
action on the part of any Person.


 


(c) If
a Series 2004-2 Pay-Out Event described in Section 6.1(c)(ii),
(c)(iii), (d),
(e) or (f)
occurs, the Agent on behalf of the Series 2004-2 Noteholders may, and the Indenture
Trustee, shall, at the direction of the Agent, by notice given in writing to
the Issuer and the Servicer (and to the Indenture Trustee if given by the
Agent) commence the Early Amortization Period as of the date of such notice.


 


(d) If
a Series 2004-2 Pay-Out Event described in Section 6.1(c)(i)
occurs, unless within fifteen (15) days of any such event (after the applicable
grace period) the Agent on


 


26





















 


behalf of the
Series 2004-2 Noteholders waives such event, the Early Amortization Period
shall commence immediately without any notice on the part of the Series 2004-2
Noteholders or Indenture Trustee.


 


(e) After
the occurrence of a Series 2004-2 Pay-Out Event, the Indenture Trustee shall
promptly notify the Rating Agencies of such event and deliver to the Rating
Agencies, upon request, and the Agent any information that the Indenture
Trustee has received from the Servicer regarding the Transferred Receivables or
the transaction contemplated by this 
Indenture Supplement and the other Transaction Documents.


 


ARTICLE VII



MISCELLANEOUS


 


SECTION 7.1                          Amendments, Waivers, Etc.  This Indenture Supplement shall not be
amended, modified or waived except in accordance with Article IX
of the Indenture.


 


SECTION 7.2                          Indenture Trustee.  The Indenture Trustee shall not be
responsible in any manner whatsoever for or in respect of the validity or
sufficiency of this Indenture Supplement or for or in respect of the
representations or recitals contained herein, all of which representations and
recitals are made solely by the Issuer and the Servicer.


 


SECTION 7.3                          Instructions in Writing.  All instructions given by the Servicer to the
Indenture Trustee pursuant to this Indenture Supplement shall be in writing,
and may be included in a Daily Report or Monthly Report.


 


SECTION 7.4                          Rule 144A.  So long as any of the Series 2004-2 Notes are
“restricted securities” within the meaning of Rule 144(a)(3) under the
Securities Act, Issuer shall, unless it becomes subject to and complies with
the reporting requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, provide to any Holder or Note Owner of such
restricted securities, or to any prospective Holder or Note Owner of such
restricted securities designated by a Holder or Note Owner, upon the request of
such Holder or Note Owner or prospective Holder or Note Owner, any information
required to be provided by Rule 144A(d)(4) under the Securities Act.


 


SECTION 7.5                          Restrictions on Transfer.


 


(a) On
the Closing Date, the Issuer shall sell the Series 2004-2 Notes to the initial
Series 2004-2 Noteholder pursuant to the Purchase Agreement and deliver such
Series 2004-2 Notes in accordance herewith and therewith.  Thereafter, no Series 2004-2 Note may be
sold, transferred or otherwise disposed of except as follows:


 


(i) to
Persons that the transferring Person reasonably believes are Qualified
Institutional Buyers in reliance on the exemption from the registration
requirements of Rule 144A under the Securities Act (“Rule 144A”);
or


 


27





















 


(ii) in
offshore transactions to non-U.S. Persons in reliance on Regulation S under the
Securities Act (“Regulation S”); or


 


(iii) to
institutional “accredited investors” within the meaning of Rule 501(a)(1), (2),
(3) or (7) of Regulation D under the Securities Act (“Institutional
Accredited Investors”) that take delivery of such Series 2004-2 Note
in an amount of at least one million dollars ($1,000,000) and that deliver
certification thereof to Indenture Trustee; or


 


(iv) to
a Person who is taking delivery of such Series 2004-2 Note pursuant to a
transaction that is otherwise exempt from the registration requirements of the
Securities Act, as confirmed in an Opinion of Counsel addressed to Indenture
Trustee and Issuer which counsel and opinion are satisfactory to Indenture
Trustee and Issuer;


 


and, in each case in
accordance with all applicable laws and regulations of the United States and
the States thereof, and (if applicable) foreign laws and regulations.


 


Indenture Trustee shall
have no obligations or duties with respect to determining whether any transfers
of the Series 2004-2 Notes are made in accordance with the Securities Act or
any other law; provided that with respect to
Definitive Notes, Indenture Trustee shall enforce such transfer restrictions in
accordance with the terms set forth on the related Series 2004-2 Note and the
provisions of this Indenture Supplement.


 


(b) Transfers
of Definitive Notes, in whole or in part, shall only be made in accordance with
this Section 7.5(b).


 


(i) Transfer of Definitive Notes.  If a Noteholder of a Definitive Note wishes
at any time to transfer such Definitive Note, such Noteholder may transfer or
cause the transfer of such interest (in an equivalent principal amount) in one
or more Definitive Notes as provided below. 
Upon receipt by the Note Registrar of (A) such holder’s Definitive
Note properly endorsed for assignment to the transferee and (B) a
certificate given by the prospective transferee of such interest, in
substantially the form of Exhibit D hereto, stating that the transfer of such
interest has been made in accordance with the applicable restrictions in the
Indenture, including that the transferee (x) if such Note is being offered, sold
or delivered in reliance on Rule 144A, such transferee is a Qualified
Institutional Buyer or (y) if such Note is being offered and sold in reliance
on Regulation S of the Securities Act, such transferee is not a U.S. Person and
is located outside of the United States, then the Note Registrar, shall cancel
such Definitive Note in accordance with Section 2.9
of the Indenture, record the transfer in the Note Register in accordance with Section 2.4(a) of the Indenture and Issuer shall
execute and Indenture Trustee shall authenticate and deliver one or more
Definitive Notes of the same Series, registered in the names specified in the
assignment described in clause (A) above, in principal amounts designated by the transferee
(the aggregate of such amounts being equal to the interest in the


 


28





















 


Definitive Notes
surrendered by the transferor), which shall not be less than the minimum
denomination for the related Series.


 


(ii) Exchange of Definitive Notes.  If a Noteholder of a Definitive Note wishes
at any time to exchange such Definitive Notes for one or more Definitive Notes
of different principal amounts of the same Series (but not less than the
minimum authorized denomination applicable thereto) that will be owned by such
Noteholder, such Noteholder may exchange or cause the exchange of such interest
for an equivalent interest in Definitive Notes of the same Series as provided
below.  Upon receipt by the Note
Registrar of (A) such Noteholder’s Definitive Notes properly endorsed for
such exchange and (B) written instructions from the Noteholder of such
Definitive Note designating the number and principal amounts of the Definitive
Notes to be exchanged (the aggregate of such principal amounts being equal to
the aggregate principal amount of the Definitive Notes surrendered for
exchange) and certifying that such exchange does not represent a change in
ownership, then the Note Registrar, shall cancel such Definitive Note in
accordance with Section 2.9 of the
Indenture, record the exchange in the Note Register in accordance with Section 2.4(a) of the Indenture and Issuer shall
execute and Indenture Trustee shall authenticate and deliver one or more
Definitive Notes of the same Series, registered in the same names as the Definitive
Notes surrendered by such holder or such different names as are specified in
the endorsement described in clause (A) above, in principal amounts designated by such
Noteholder (the aggregate of such amounts being equal to the interest in the
Definitive Notes surrendered by such holder) and in no less than the minimum
denomination for the related Series.


 


(c) Each
purchaser (other than the initial Series 2004-2 Noteholder) of the Series
2004-2 Notes shall be deemed to have acknowledged and agreed as follows (terms
used in this paragraph that are defined in Rule 144A or Regulation S under the
Securities Act and used herein as defined therein):


 


(1)                                  It
is either (a)(i) a qualified institutional buyer as defined in Rule 144A (“Qualified Institutional Buyer”), (ii) is aware that the sale
of the Series 2004-2 Notes to it is being made in reliance on the exemption
from registration provided by Rule 144A, and (iii) is acquiring the Series
2004-2 Notes for its own account or for one or more accounts, each of which is
a Qualified Institutional Buyer, and as to each of which the owner exercises
sole investment discretion, and in a principal amount of not less than the
minimum denomination of such Note for the purchaser and for each such account
or (b) is not a U.S. Person and is purchasing the Note pursuant to Rule 903 or
904 of Regulation S, and in a principal amount of not less than the minimum
denomination of such Note.  Any purported
transfer of the Series 2004-2 Notes to a purchaser that does not comply with the
requirements of this paragraph shall be null and void ab initio.  Issuer or Indenture Trustee on its behalf,
may sell any Notes acquired in violation of the foregoing at the cost and risk
of purported owner.


 


29





















 


(2)                                  It
understands that the Series 2004-2 Notes will bear a legend substantially as
set forth in the Exhibit A hereto.  The
Series 2004-2 Notes may not at any time be held by or on behalf of any Person
that is not a Qualified Institutional Buyer or a Non-U.S. Person purchasing in
accordance with Regulation S.


 


(3)                                  It
understands that the Series 2004-2 Notes are being offered only in a
transaction not involving any public offering in the United States within the
meaning of the Securities Act, the Series 2004-2 Notes have not been and will
not be registered under the Securities Act, and, if in the future the
transferee decides to offer, resell, pledge or otherwise transfer the Series
2004-2 Notes, such Series 2004-2 Notes may only be offered, resold, pledged or
otherwise transferred in accordance with the Indenture, this Indenture
Supplement and the applicable legend on such Series 2004-2 Notes.  It acknowledges that no representation is
made by Issuer as to the availability of any exemption under the Securities Act
or any applicable state securities laws for resale of the Series 2004-2 Notes.


 


(4)                                  It
understands that an investment in the Series 2004-2 Notes involves certain
risks, including the risk of loss of all or a substantial part of its
investment under certain circumstances. 
It has had access to such financial and other information concerning
Issuer and the Series 2004-2 Notes as it deemed necessary or appropriate in
order to make an informed investment decision with respect to purchase of the
Series 2004-2 Notes, including an opportunity to ask questions of and request
information from Servicer and Issuer.  It
has such knowledge and experience in financial and business matters as to be
capable of evaluating the merits and risks of its investment in the Series
2004-2 Notes, and it and any accounts for which it is acting are each able to
bear the economic risk of the holder’s or of its investment.


 


(5)                                  It
acknowledges that Indenture Trustee, the Note Registrar, any Paying Agent,
Issuer, their affiliates, and others will rely upon the truth and accuracy of
the foregoing acknowledgments, representations and agreements.  If it is acquiring the Series 2004-2 Notes or
any interest therein for the account of one or more qualified institutional
buyers, it represents that it has sole investment discretion with respect to
each such account and that it has full power to make the foregoing
acknowledgments, representations and agreements on behalf of each such account.


 


(6)                                  Either (a) it is not acquiring the Series
2004-2 Notes with the plan assets of any “employee benefit plan” as defined in Section 3(3)
of ERISA, which is subject to Title I of ERISA, a “plan” as defined in Section 4975
of the Internal Revenue Code of 1986, as amended (the “Code”),
or a “governmental plan” as defined in Section 3(32) of ERISA which is
subject to any law substantially similar to ERISA or Section 4975 of the
Code or (b) its acquisition and holding of the Series 2004-2 Note will not give
rise to a nonexempt prohibited transaction


 


30





















 


under Section 406 of ERISA, Section 4975 of the Code or any
substantially similar applicable law.


 


(7)                                  It
is purchasing one or more Series 2004-2 Notes in an amount of at least one
million dollars ($1,000,000) and it understands that such Series 2004-2 Notes
may be resold, pledged or otherwise transferred only in an amount of at least
one million dollars ($1,000,000).


 


(8)                                  Each
investor described in subclause (1)(b)
above understands that the Series 2004-2 Notes have not and shall not be
registered under the Securities Act, that any offers, sales or deliveries of
the Series 2004-2 Notes purchased by it in the United States or to U.S. Persons
prior to the date that is 40 days after the later of (i) the commencement of
the distribution of the Series 2004-2 Notes and (ii) the Closing Date, may
constitute a violation of United States law.


 


SECTION 7.6                          Survival of Agreements.  All covenants, agreements, representations
and warranties made herein and in the Series 2004-2 Notes delivered pursuant
hereto shall survive the execution and delivery of this Indenture Supplement
and the Series 2004-2 Notes and shall continue in full force and effect,
and this Indenture Supplement shall not terminate, until the Outstanding Principal
Balance of the Series 2004-2 Notes shall have been reduced to zero, all accrued
and unpaid interest thereon shall have been paid in full, and all other
obligations owed in respect of the Series 2004-2 Notes have been paid and
performed in full.  In addition, Section 7.4 and this Section 7.6
shall survive termination of this Indenture Supplement.


 


[Signature
Pages Follow]


 


31





















 


IN WITNESS WHEREOF, the Issuer and the
Indenture Trustee have caused this Indenture Supplement to be duly executed as
of the day and year first above written.


 


 


	
   

  	
  SSCE FUNDING, LLC, as Issuer

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Richard P. Marra

  	
   

  
	
   

  	
   

  	
  Name: Richard P. Marra

  
	
   

  	
   

  	
  Title: Assistant Treasurer

  



 


S-1





















 


 


	
   

  	
  DEUTSCHE BANK TRUST COMPANY

  AMERICAS, as Indenture Trustee

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jenna Kaufman

  	
   

  
	
   

  	
   

  	
  Name: Jenna Kaufman

  
	
   

  	
   

  	
  Title: Vice President

  



 


S-2





















 


	
  Acknowledged and Accepted:

  
	
   

  
	
  STONE
  RECEIVABLES CORPORATION, as Transferor

  
	
   

  
	
  By:

  	
  /s/ Richard P. Marra

  	
   

  
	
  Name: Richard P. Marra

  
	
  Title: Assistant Treasurer

  
	
   

  
	
   

  
	
  SMURFIT-STONE
  CONTAINER ENTERPRISES, INC., as Servicer

  
	
   

  
	
  By:

  	
  /s/ Richard P. Marra

  	
   

  
	
  Name: Richard P. Marra

  
	
  Title: Assistant Treasurer

  



 


S-3





















 


EXHIBIT
A

to the Series 2004-2 Indenture Supplement


 


FORM OF SERIES 2004-2
NOTE


 


 


1





















 


EXHIBIT B


to the Series 2004-2
Indenture Supplement


 


FORM OF DAILY REPORT


 


 


1





















 


EXHIBIT C


to the Series 2004-2
Indenture Supplement


 


FORM OF MONTHLY REPORT


 


 


1





















 


EXHIBIT D

to the Series 2004-2 Indenture Supplement


 


FORM OF PURCHASER LETTER


 


                        ,
20   


 


SSCE Funding, LLC


[Address]


 


Deutsche Bank Trust Company Americas


[Address]


 


Stone Receivables Corporation


[Address]


 


Smurfit-Stone Container Enterprises, Inc., as Servicer


[Address]


 


Société Générale


[Address]


 


Ladies and Gentlemen:


 


We are delivering this
letter in connection with the transfer of $                    
of the VARIABLE FUNDING NOTE, Series 2004-2 (the “Notes”) issued by SSCE Funding, LLC (the “Issuer”) created under the Master
Indenture, dated as of November 23, 2004 (as the same may be amended,
restated, supplemented or otherwise modified from time to time,  the “Indenture”),
between Issuer and Deutsche Bank Trust Company Americas, as Indenture Trustee
(the “Indenture Trustee”), and
the Series 2004-2 Indenture Supplement thereto, dated as of November 23,
2004 (as the same may be amended, restated, supplemented or otherwise modified
from time to time, the “Series 2004-2
Indenture Supplement”), among Issuer and Indenture Trustee.  Capitalized terms used herein without
definition shall have the meanings assigned thereto in (or by reference in) the
Series 2004-2 Indenture Supplement.


 


We hereby confirm that:


 


(i) we
are a “qualified
institutional buyer” (a “QIB”) as set forth in Rule 144A
under the Securities Act of 1933, as amended (the “Securities Act”);


 


(ii) we
are purchasing the Series 2004-2 Notes for our own account or for the account
of one or more other QIBs;


 


1





















 


(iii) we
are taking delivery of Notes in an amount of at least $1,000,000 for our own account or for each separate
account for which we are acting;


 


(iv) we
have such knowledge and experience in financial and business matters, we are
capable of evaluating the merits and risks of purchasing Notes and we, or the
account for which we are purchasing Notes, can bear the economic risks of
investing in the Series 2004-2 Notes for an indefinite period of time;


 


(v) we
are acquiring Notes for investment and not with a view to any distribution
thereof in a transaction that would violate the Securities Act or the
securities laws of any state of the United States or any other applicable
jurisdiction; provided that the
disposition of our property and the property of any accounts for which we are
acting as fiduciary shall remain at all times within our control; and


 


(vi) we
represent to Issuer, Transferor Indenture Trustee, Servicer and any successor
Servicer that [to be updated upon final 7.5]


 


We understand that the
Series 2004-2 Notes are being offered in a transaction not involving any public
offering within the meaning of the Securities Act and that the Series 2004-2
Notes have not been registered under the Securities Act, and we agree, on our
own behalf and on behalf of each account for which we acquire any Notes, that
such Notes may be resold, pledged or transferred only in a transaction meeting
the requirements of Rule 144A (“Rule 144A”)
under the Securities Act, to a person that we reasonably believe is a “qualified
institutional buyer” (as defined in Rule 144A) that purchases for its own
account (or for the account or accounts of a qualified institutional buyer) and
to whom notice is given that the resale, pledge or other transfer is being made
in reliance on Rule 144A.


 


We understand that the
Paying Agent and Indenture Trustee shall not be required to accept for
registration of transfer any Notes, except upon presentation of evidence
satisfactory to Issuer that the foregoing restrictions on transfer have been
complied with.


 


We understand that the
Series 2004-2 Notes shall bear a legend substantially to the effect set forth
in the Exhibits to the Series 2004-2 Indenture Supplement.


 


We understand that this
letter is required in connection with certain securities laws.  If administrative or other proceedings are
commenced in connection with which this letter is or would be relevant, we
irrevocably authorize you to produce this letter or a copy of this letter to
any interested party in such proceedings.


 


THIS
LETTER WILL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF NEW YORK.


 


2





















 


IN WITNESS WHEREOF, the
undersigned has caused its name to be signed hereby by its duly authorized
officer, as of the day and year written above.


 


	
   

  	
  [NAME OF INVESTOR]

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  



 


3