Document:

EXHIBIT 4.8

 

	
  (Multicurrency—Cross Border)

  	
   

  	
  2004-C

  CLASS M SWAP

  

 

ISDA®

 

International Swap
Dealers Association, Inc.

 

MASTER AGREEMENT

 

dated as of
September 22, 2004

 

	
  Barclays
  Bank PLC

  (“Party A”)

  	
   

  	
  and

  	
   

  	
  World Financial Network Credit Card
Master Note Trust
(“Party
  B”)

  

 

 

have entered and/or
anticipate entering into one or more transactions (each a “Transaction”) that
are or will be governed by this Master Agreement, which includes the
schedule (the “Schedule”), and the documents and other confirming evidence
(each a “Confirmation”) exchanged between the parties confirming those
Transactions.

 

Accordingly, the parties
agree as follows:—

 

1.                                      Interpretation

 

(a)                                  Definitions. The
terms defined in Section 14 and in the Schedule will have the
meanings therein specified for the purpose of this Master Agreement.

 

(b)                                 Inconsistency. In the
event of any inconsistency between the provisions of the Schedule and the
other provisions of this Master Agreement, the Schedule will prevail.  In the event of any inconsistency between
the provisions of any Confirmation and this Master Agreement (including the
Schedule), such Confirmation will prevail for the purpose of the relevant
Transaction.

 

(c)                                  Single Agreement. All
Transactions are entered into in reliance on the fact that this Master
Agreement and all Confirmations form a single agreement between the parties
(collectively referred to as this “Agreement”), and the parties would not
otherwise enter into any Transactions.

 

2.                                      Obligations

 

(a)                                  General Conditions.

 

(i)                                     Each
party will make each payment or delivery specified in each Confirmation to be
made by it, subject to the other provisions of this Agreement.

 

(ii)                                  Payments
under this Agreement will be made on the due date for value on that date in the
place of the account specified in the relevant Confirmation or otherwise
pursuant to this Agreement, in freely transferable funds and in the manner
customary for payments in the required currency. Where settlement is by
delivery (that is, other than by payment), such delivery will be made for
receipt on the due date in the manner customary for the relevant obligation
unless otherwise specified in the relevant Confirmation or elsewhere in this
Agreement.

 

(iii)                               Each
obligation of each party under Section 2(a)(i) is subject to (1) the
condition precedent that no Event of Default or Potential Event of Default with
respect to the other party has occurred and is continuing, (2) the condition
precedent that no Early Termination Date in respect of the relevant Transaction
has occurred or been effectively designated and (3) each other applicable
condition precedent specified in this Agreement.

 

Copyright © 1992
by International Swap Dealers Association, Inc.

 

 

(b)                                 Change of Account.  Either party may change its
account for receiving a payment or delivery by giving notice to the other party
at least five Local Business Days prior to the scheduled date for the payment
or delivery to which such change applies unless such other party gives timely
notice of a reasonable objection to such change.

 

(c)                                  Netting.  If on any date amounts would otherwise be
payable:—

 

(i)                                     in
the same currency; and

 

(ii)                                  in
respect of the same Transaction,

 

by each party to the
other, then, on such date, each party’s obligation to make payment of any such
amount will be automatically satisfied and discharged and, if the aggregate
amount that would otherwise have been payable by one party exceeds the
aggregate amount that would otherwise have been payable by the other party,
replaced by an obligation upon the party by whom the larger aggregate amount
would have been payable to pay to the other party the excess of the larger
aggregate amount over the smaller aggregate amount.

 

The parties may elect in
respect of two or more Transactions that a net amount will be determined in
respect of all amounts payable on the same date in the same currency in respect
of such Transactions, regardless of whether such amounts are payable in respect
of the same Transaction.  The election
may be made in the Schedule or a Confirmation by specifying that
subparagraph (ii) above will not apply to the Transactions identified as being
subject to the election, together with the starting date (in which case
subparagraph (ii) above will not, or will cease to, apply to such Transactions
from such date).  This election may be
made separately for different groups of Transactions and will apply separately
to each pairing of Offices through which the parties make and receive payments
or deliveries.

 

(d)                                 Deduction or Withholding for Tax.

 

(i)                                     Gross-Up.  All payments under this Agreement will be
made without any deduction or withholding for or on account of any Tax unless
such deduction or withholding is required by any applicable law, as modified by
the practice of any relevant governmental revenue authority, then in
effect.  If a party is so required to
deduct or withhold, then that party (“X”) will:—

 

(1)                                  promptly
notify the other party (“Y”) of such requirement;

 

(2)                                  pay
to the relevant authorities the full amount required to be deducted or withheld
(including the full amount required to be deducted or withheld from any
additional amount paid by X to Y under this Section 2(d)) promptly upon
the earlier of determining that such deduction or withholding is required or
receiving notice that such amount has been assessed against Y;

 

(3)                                  promptly
forward to Y an official receipt (or a certified copy), or other documentation
reasonably acceptable to Y, evidencing such payment to such authorities; and

 

(4)                                  if
such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which
Y is otherwise entitled under this Agreement, such additional amount as is
necessary to ensure that the net amount actually received by Y (free and clear
of Indemnifiable Taxes, whether assessed against X or Y) will equal the full amount
Y would have received had no such deduction or withholding been required.  However, X will not be required to pay any
additional amount to Y to the extent that it would not be required to be paid
but for:—

 

(A)                              the
failure by Y to comply with or perform any agreement contained in
Section 4(a)(i), 4(a)(iii) or 4(d); or

 

(B)                                the
failure of a representation made by Y pursuant to Section 3(f) to be
accurate and true unless such failure would not have occurred but for (I) any
action taken by a taxing authority, or brought in a court of competent
jurisdiction, on or after the date on which a Transaction is entered into
(regardless of whether such action is taken or brought with respect to a party
to this Agreement) or (II) a Change in Tax Law.

 

2

 

(ii)                                  Liability.  If:—

 

(1)                                  X
is required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, to make any deduction or withholding in respect
of which X would not be required to pay an additional amount to Y under
Section 2(d)(i)(4);

 

(2)                                  X
does not so deduct or withhold; and

 

(3)                                  a
liability resulting from such Tax is assessed directly against X,

 

then, except to the
extent Y has satisfied or then satisfies the liability resulting from such Tax,
Y will promptly pay to X the amount of such liability (including any related
liability for interest, but including any related liability for penalties only
if Y has failed to comply with or perform any agreement contained in Section 4(a)(i),
4(a)(iii) or 4(d)).

 

(e)                                  Default Interest; Other Amounts.  Prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant
Transaction, a party that defaults in the performance of any payment obligation
will, to the extent permitted by law and subject to Section 6(c), be
required to pay interest (before as well as after judgment) on the overdue
amount to the other party on demand in the same currency as such overdue
amount, for the period from (and including) the original due date for payment
to (but excluding) the date of actual payment, at the Default Rate.  Such interest will be calculated on the
basis of daily compounding and the actual number of days elapsed.  If, prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant
Transaction, a party defaults in the performance of any obligation required to
be settled by delivery, it will compensate the other party on demand if and to
the extent provided for in the relevant Confirmation or elsewhere in this
Agreement.

 

3.                                      Representations

 

Each party represents to
the other party (which representations will be deemed to be repeated by each
party on each date on which a Transaction is entered into and, in the case of
the representations in Section 3(f), at all times until the termination of
this Agreement) that:—

 

(a)                                  Basic Representations.

 

(i)                                     Status.  It is duly organised and validly existing
under the laws of the jurisdiction of its organisation or incorporation and, if
relevant under such laws, in good standing;

 

(ii)                                  Powers.  It has the power to execute this Agreement
and any other documentation relating to this Agreement to which it is a party,
to deliver this Agreement and any other documentation relating to this
Agreement that it is required by this Agreement to deliver and to perform its
obligations under this Agreement and any obligations it has under any Credit
Support Document to which it is a party and has taken all necessary action to
authorise such execution, delivery and performance;

 

(iii)                               No Violation or Conflict.  Such execution, delivery and performance do
not violate or conflict with any law applicable to it, any provision of its
constitutional documents, any order or judgment of any court or other agency of
government applicable to it or any of its assets or any contractual restriction
binding on or affecting it or any of its assets;

 

(iv)                              Consents.  All governmental and other consents that are
required to have been obtained by it with respect to this Agreement or any
Credit Support Document to which it is a party have been obtained and are in
full force and effect and all conditions of any such consents have been
complied with; and

 

(v)                                 Obligations Binding.  Its obligations under this Agreement and any
Credit Support Document to which it is a party constitute its legal, valid and
binding obligations, enforceable in accordance with their respective terms
(subject to applicable bankruptcy, reorganisation, insolvency, moratorium or
similar laws affecting creditors’ rights generally and subject, as to
enforceability, to equitable principles of general application (regardless of
whether enforcement is sought in a proceeding in equity or at law)).

 

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(b)                                 Absence of Certain Events.  No Event of Default or Potential Event of
Default or, to its knowledge, Termination Event with respect to it has occurred
and is continuing and no such event or circumstance would occur as a result of
its entering into or performing its obligations under this Agreement or any
Credit Support Document to which it is a party.

 

(c)                                  Absence of Litigation.  There is not pending or, to its knowledge,
threatened against it or any of its Affiliates any action, suit or proceeding
at law or in equity or before any court, tribunal, governmental body, agency or
official or any arbitrator that is likely to affect the legality, validity or
enforceability against it of this Agreement or any Credit Support Document to
which it is a party or its ability to perform its obligations under this
Agreement or such Credit Support Document.

 

(d)                                 Accuracy of Specified Information.  All applicable information that is furnished
in writing by or on behalf of it to the other party and is identified for the
purpose of this Section 3(d) in the Schedule is, as of the date of
the information, true, accurate and complete in every material respect.

 

(e)                                  Payer Tax Representation.  Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(e) is
accurate and true.

 

(f)                                    Payee Tax Representations.  Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(f) is
accurate and true.

 

4.                                      Agreements

 

Each party agrees with
the other that, so long as either party has or may have any obligation under
this Agreement or under any Credit Support Document to which it is a party:—

 

(a)                                  Furnish Specified Information.  It will deliver to the other party or, in
certain cases under subparagraph (iii) below, to such government or taxing
authority as the other party reasonably directs:

 

(i)                                     any
forms, documents or certificates relating to taxation specified in the
Schedule or any Confirmation;

 

(ii)                                  any
other documents specified in the Schedule or any Confirmation; and

 

(iii)                               upon
reasonable demand by such other party, any form or document that may be
required or reasonably requested in writing in order to allow such other party
or its Credit Support Provider to make a payment under this Agreement or any
applicable Credit Support Document without any deduction or withholding for or
on account of any Tax or with such deduction or withholding at a reduced rate
(so long as the completion, execution or submission of such form or document
would not materially prejudice the legal or commercial position of the party in
receipt of such demand), with any such form or document to be accurate and
completed in a manner reasonably satisfactory to such other party and to be
executed and to be delivered with any reasonably required certification,

 

in each case by the date
specified in the Schedule or such Confirmation or, if none is specified,
as soon as reasonably practicable.

 

(b)                                 Maintain Authorisations.  It will use all reasonable efforts to
maintain in full force and effect all consents of any governmental or other
authority that are required to be obtained by it with respect to this Agreement
or any Credit Support Document to which it is a party and will use all
reasonable efforts to obtain any that may become necessary in the future.

 

(c)                                  Comply with Laws.  It will comply in all material respects with
all applicable laws and orders to which it may be subject if failure so to
comply would materially impair its ability to perform its obligations under
this Agreement or any Credit Support Document to which it is a party.

 

(d)                                 Tax Agreement.  It will give notice of any failure of a
representation made by it under Section 3(f) to be accurate and true
promptly upon learning of such failure.

 

(e)                                  Payment of Stamp Tax.  Subject to Section 11, it will pay any
Stamp Tax levied or imposed upon it or in respect of its execution or
performance of this Agreement by a jurisdiction in which it is incorporated,
organised, managed and controlled, or considered to have its seat, or in which a
branch or office through

 

4

 

which it is acting for
the purpose of this Agreement is located (“Stamp Tax Jurisdiction”) and will
indemnify the other party against any Stamp Tax levied or imposed upon the
other party or in respect of the other party’s execution or performance of this
Agreement by any such Stamp Tax Jurisdiction which is not also a Stamp Tax
Jurisdiction with respect to the other party.

 

5.                                      Events
of Default and Termination Events

 

(a)                                  Events of Default.  The occurrence at any time with respect to a
party or, if applicable, any Credit Support Provider of such party or any
Specified Entity of such party of any of the following events constitutes an
event of default (an “Event of Default”) with respect to such party:—

 

(i)                                     Failure to Pay or Deliver.  Failure by the party to make, when due, any
payment under this Agreement or delivery under Section 2(a)(i) or 2(e)
required to be made by it if such failure is not remedied on or before the
third Local Business Day after notice of such failure is given to the party;

 

(ii)                                  Breach of Agreement.  Failure by the party to comply with or
perform any agreement or obligation (other than an obligation to make any
payment under this Agreement or delivery under Section 2(a)(i) or 2(e) or
to give notice of a Termination Event or any agreement or obligation under
Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by
the party in accordance with this Agreement if such failure is not remedied on
or before the thirtieth day after notice of such failure is given to the party;

 

(iii)                               Credit Support Default.

 

(1)                                  Failure
by the party or any Credit Support Provider of such party to comply with or
perform any agreement or obligation to be complied with or performed by it in
accordance with any Credit Support Document if such failure is continuing after
any applicable grace period has elapsed;

 

(2)                                  the
expiration or termination of such Credit Support Document or the failing or
ceasing of such Credit Support Document to be in full force and effect for the
purpose of this Agreement (in either case other than in accordance with its
terms) prior to the satisfaction of all obligations of such party under each
Transaction to which such Credit Support Document relates without the written
consent of the other party; or

 

(3)                                  the
party or such Credit Support Provider disaffirms, disclaims, repudiates or
rejects, in whole or in part, or challenges the validity of, such Credit
Support Document;

 

(iv)                              Misrepresentation.  A representation (other than a
representation under Section 3(e) or (f)) made or repeated or deemed to
have been made or repeated by the party or any Credit Support Provider of such
party in this Agreement or any Credit Support Document proves to have been incorrect
or misleading in any material respect when made or repeated or deemed to have
been made or repeated;

 

(v)                                 Default under Specified Transaction.  The party, any Credit Support Provider of
such party or any applicable Specified Entity of such party (1) defaults under
a Specified Transaction and, after giving effect to any applicable notice
requirement or grace period, there occurs a liquidation of, an acceleration of
obligations under, or an early termination of, that Specified Transaction, (2)
defaults, after giving effect to any applicable notice requirement or grace
period, in making any payment or delivery due on the last payment, delivery or
exchange date of, or any payment on early termination of, a Specified
Transaction (or such default continues for at least three Local Business Days
if there is no applicable notice requirement or grace period) or (3)
disaffirms, disclaims, repudiates or rejects, in whole or in part, a Specified
Transaction (or such action is taken by any person or entity appointed or
empowered to operate it or act on its behalf);

 

(vi)                              Cross Default.  If “Cross Default” is specified in the
Schedule as applying to the party, the occurrence or existence of (1) a
default, event of default or other similar condition or event (however

 

5

 

described) in respect of
such party, any Credit Support Provider of such party or any applicable
Specified Entity of such party under one or more agreements or instruments
relating to Specified Indebtedness of any of them (individually or
collectively) in an aggregate amount of not less than the applicable Threshold
Amount (as specified in the Schedule) which has resulted in such Specified
Indebtedness becoming, or becoming capable at such time of being declared, due
and payable under such agreements or instruments, before it would otherwise
have been due and payable or (2) a default by such party, such Credit Support
Provider or such Specified Entity (individually or collectively) in making one
or more payments on the due date thereof in an aggregate amount of not less
than the applicable Threshold Amount under such agreements or instruments
(after giving effect to any applicable notice requirement or grace period);

 

(vii)                           Bankruptcy.  The party, any Credit Support Provider of
such party or any applicable Specified Entity of such party:—

 

(1)                                  is
dissolved (other than pursuant to a consolidation, amalgamation or merger); (2)
becomes insolvent or is unable to pay its debts or fails or admits in writing
its inability generally to pay its debts as they become due; (3) makes a
general assignment, arrangement or composition with or for the benefit of its
creditors; (4) institutes or has instituted against it a proceeding seeking a
judgment of insolvency or bankruptcy or any other relief under any bankruptcy
or insolvency law or other similar law affecting creditors’ rights, or a
petition is presented for its winding-up or liquidation, and, in the case of
any such proceeding or petition instituted or presented against it, such
proceeding or petition (A) results in a judgment of insolvency or bankruptcy or
the entry of an order for relief or the making of an order for its winding-up
or liquidation or (B) is not dismissed, discharged, stayed or restrained in
each case within 30 days of the institution or presentation thereof; (5) has a
resolution passed for its winding-up, official management or liquidation (other
than pursuant to a consolidation, amalgamation or merger); (6) seeks or becomes
subject to the appointment of an administrator, provisional liquidator,
conservator, receiver, trustee, custodian or other similar official for it or
for all or substantially all its assets; (7) has a secured party take
possession of all or substantially all its assets or has a distress, execution,
attachment, sequestration or other legal process levied, enforced or sued on or
against all or substantially all its assets and such secured party maintains
possession, or any such process is not dismissed, discharged, stayed or
restrained, in each case within 30 days thereafter; (8) causes or is subject to
any event with respect to it which, under the applicable laws of any
jurisdiction, has an analogous effect to any of the events specified in clauses
(1) to (7) (inclusive); or (9) takes any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the
foregoing acts; or

 

(viii)                        Merger Without Assumption.  The party or any Credit Support Provider of
such party consolidates or amalgamates with, or merges with or into, or
transfers all or substantially all its assets to, another entity and, at the
time of such consolidation, amalgamation, merger or transfer:—

 

(1)                                  the
resulting, surviving or transferee entity fails to assume all the obligations
of such party or such Credit Support Provider under this Agreement or any
Credit Support Document to which it or its predecessor was a party by operation
of law or pursuant to an agreement reasonably satisfactory to the other party
to this Agreement; or

 

(2)                                  the
benefits of any Credit Support Document fail to extend (without the consent of
the other party) to the performance by such resulting, surviving or transferee
entity of its obligations under this Agreement.

 

(b)                                 Termination Events.  The occurrence at any time with respect to a
party or, if applicable, any Credit Support Provider of such party or any
Specified Entity of such party of any event specified below constitutes an
Illegality if the event is specified in (i) below, a Tax Event if the event is
specified in (ii) below or a Tax Event Upon Merger if the event is specified in
(iii) below, and, if specified to be applicable, a Credit Event

 

6

 

Upon Merger if the event
is specified pursuant to (iv) below or an Additional Termination Event if the
event is specified pursuant to (v) below:—

 

(i)                                     Illegality.  Due to the adoption of, or any change in,
any applicable law after the date on which a Transaction is entered into, or
due to the promulgation of, or any change in, the interpretation by any court,
tribunal or regulatory authority with competent jurisdiction of any applicable
law after such date, it becomes unlawful (other than as a result of a breach by
the party of Section 4(b)) for such party (which will be the Affected
Party):—

 

(1)                                  to
perform any absolute or contingent obligation to make a payment or delivery or
to receive a payment or delivery in respect of such Transaction or to comply
with any other material provision of this Agreement relating to such Transaction;
or

 

(2)                                  to
perform, or for any Credit Support Provider of such party to perform, any
contingent or other obligation which the party (or such Credit Support
Provider) has under any Credit Support Document relating to such Transaction;

 

(ii)                                  Tax Event.  Due to (x) any action taken by a taxing
authority, or brought in a court of competent jurisdiction, on or after the
date on which a Transaction is entered into (regardless of whether such action
is taken or brought with respect to a party to this Agreement) or (y) a Change
in Tax Law, the party (which will be the Affected Party) will, or there is a
substantial likelihood that it will, on the next succeeding Scheduled Payment
Date (1) be required to pay to the other party an additional amount in respect
of an Indemnifiable Tax under Section 2(d)(i)(4) (except in respect of
interest under Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment
from which an amount is required to be deducted or withheld for or on account
of a Tax (except in respect of interest under Section 2(e), 6(d)(ii) or
6(e)) and no additional amount is required to be paid in respect of such Tax
under Section 2(d)(i)(4) (other than by reason of
Section 2(d)(i)(4)(A) or (B));

 

(iii)                               Tax Event Upon Merger.  The party (the “Burdened Party”) on the next
succeeding Scheduled Payment Date will either (1) be required to pay an
additional amount in respect of an Indemnifiable Tax under
Section 2(d)(i)(4) (except in respect of interest under Section 2(e),
6(d)(ii) or 6(e)) or (2) receive a payment from which an amount has been
deducted or withheld for or on account of any Indemnifiable Tax in respect of
which the other party is not required to pay an additional amount (other than
by reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of
a party consolidating or amalgamating with, or merging with or into, or
transferring all or substantially all its assets to, another entity (which will
be the Affected Party) where such action does not constitute an event described
in Section 5(a)(viii);

 

(iv)                              Credit Event Upon Merger.  If “Credit Event Upon Merger” is specified
in the Schedule as applying to the party, such party (“X”), any Credit
Support Provider of X or any applicable Specified Entity of X consolidates or
amalgamates with, or merges with or into, or transfers all or substantially all
its assets to, another entity and such action does not constitute an event
described in Section 5(a)(viii) but the creditworthiness of the resulting,
surviving or transferee entity is materially weaker than that of X, such Credit
Support Provider or such Specified Entity, as the case may be, immediately
prior to such action (and, in such event, X or its successor or transferee, as
appropriate, will be the Affected Party); or

 

(v)                                 Additional Termination Event.  If any “Additional Termination Event” is
specified in the Schedule or any Confirmation as applying, the occurrence
of such event (and, in such event, the Affected Party or Affected Parties shall
be as specified for such Additional Termination Event in the Schedule or
such Confirmation).

 

(c)                                  Event of Default and Illegality.  If an event or circumstance which would
otherwise constitute or give rise to an Event of Default also constitutes an
Illegality, it will be treated as an Illegality and will not constitute an
Event of Default.

 

7

 

6.                                      Early
Termination

 

(a)                                  Right to Terminate Following Event
of Default.  If at any
time an Event of Default with respect to a party (the “Defaulting Party”) has
occurred and is then continuing, the other party (the “Non-defaulting Party”)
may, by not more than 20 days notice to the Defaulting Party specifying the
relevant Event of Default, designate a day not earlier than the day such notice
is effective as an Early Termination Date in respect of all outstanding
Transactions.  If, however, “Automatic
Early Termination” is specified in the Schedule as applying to a party,
then an Early Termination Date in respect of all outstanding Transactions will
occur immediately upon the occurrence with respect to such party of an Event of
Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the extent
analogous thereto, (8), and as of the time immediately preceding the
institution of the relevant proceeding or the presentation of the relevant
petition upon the occurrence with respect to such party of an Event of Default
specified in Section 5(a)(vii)(4) or, to the extent analogous thereto,
(8).

 

(b)                                 Right to Terminate Following
Termination Event.

 

(i)                                     Notice.  If a Termination Event occurs, an Affected
Party will, promptly upon becoming aware of it, notify the other party,
specifying the nature of that Termination Event and each Affected Transaction
and will also give such other information about that Termination Event as the other
party may reasonably require.

 

(ii)                                  Transfer to Avoid Termination Event.  If either an Illegality under
Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected
Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the Affected
Party, the Affected Party will, as a condition to its right to designate an
Early Termination Date under Section 6(b)(iv), use all reasonable efforts
(which will not require such party to incur a loss, excluding immaterial,
incidental expenses) to transfer within 20 days after it gives notice under
Section 6(b)(i) all its rights and obligations under this Agreement in
respect of the Affected Transactions to another of its Offices or Affiliates so
that such Termination Event ceases to exist.

 

If the Affected Party is
not able to make such a transfer it will give notice to the other party to that
effect within such 20 day period, whereupon the other party may effect such a
transfer within 30 days after the notice is given under Section 6(b)(i).

 

Any such transfer by a
party under this Section 6(b)(ii) will be subject to and conditional upon
the prior written consent of the other party, which consent will not be
withheld if such other party’s policies in effect at such time would permit it
to enter into transactions with the transferee on the terms proposed.

 

(iii)                               Two Affected Parties.  If an Illegality under
Section 5(b)(i)(1) or a Tax Event occurs and there are two Affected
Parties, each party will use all reasonable efforts to reach agreement within
30 days after notice thereof is given under Section 6(b)(i) on action to
avoid that Termination Event.

 

(iv)                              Right to Terminate.  If:—

 

(1)                                  a
transfer under Section 6(b)(ii) or an agreement under
Section 6(b)(iii), as the case may be, has not been effected with respect
to all Affected Transactions within 30 days after an Affected Party gives
notice under Section 6(b)(i); or

 

(2)                                  an
Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger or an
Additional Termination Event occurs, or a Tax Event Upon Merger occurs and the
Burdened Party is not the Affected Party,

 

either party in the case
of an Illegality, the Burdened Party in the case of a Tax Event Upon Merger,
any Affected Party in the case of a Tax Event or an Additional Termination
Event if there is more than one Affected Party, or the party which is not the
Affected Party in the case of a Credit Event Upon Merger or an Additional
Termination Event if there is only one Affected Party may, by not more than 20
days notice to the other party and provided that the relevant Termination Event
is then

 

8

 

continuing, designate a
day not earlier than the day such notice is effective as an Early Termination
Date in respect of all Affected Transactions.

 

(c)                                  Effect of Designation.

 

(i)                                     If
notice designating an Early Termination Date is given under Section 6(a)
or (b), the Early Termination Date will occur on the date so designated,
whether or not the relevant Event of Default or Termination Event is then
continuing.

 

(ii)                                  Upon
the occurrence or effective designation of an Early Termination Date, no
further payments or deliveries under Section 2(a)(i) or 2(e) in respect of
the Terminated Transactions will be required to be made, but without prejudice
to the other provisions of this Agreement. 
The amount, if any, payable in respect of an Early Termination Date
shall be determined pursuant to Section 6(e).

 

(d)                                 Calculations.

 

(i)                                     Statement.  On or as soon as reasonably practicable
following the occurrence of an Early Termination Date, each party will make the
calculations on its part, if any, contemplated by Section 6(e) and will
provide to the other party a statement (1) showing, in reasonable detail, such
calculations (including all relevant quotations and specifying any amount
payable under Section 6(e)) and (2) giving details of the relevant account
to which any amount payable to it is to be paid.  In the absence of written confirmation from the source of a
quotation obtained in determining a Market Quotation, the records of the party
obtaining such quotation will be conclusive evidence of the existence and
accuracy of such quotation.

 

(ii)                                  Payment Date.  An amount calculated as being due in respect
of any Early Termination Date under Section 6(e) will be payable on the
day that notice of the amount payable is effective (in the case of an Early
Termination Date which is designated or occurs as a result of an Event of
Default) and on the day which is two Local Business Days after the day on which
notice of the amount payable is effective (in the case of an Early Termination
Date which is designated as a result of a Termination Event).  Such amount will be paid together with (to
the extent permitted under applicable law) interest thereon (before as well as
after judgment) in the Termination Currency, from (and including) the relevant
Early Termination Date to (but excluding) the date such amount is paid, at the
Applicable Rate.  Such interest will be
calculated on the basis of daily compounding and the actual number of days
elapsed.

 

(e)                                  Payments on Early Termination.  If an Early Termination Date occurs, the
following provisions shall apply based on the parties’ election in the
Schedule of a payment measure, either “Market Quotation” or “Loss”, and a
payment method, either the “First Method” or the “Second Method”.  If the parties fail to designate a payment
measure or payment method in the Schedule, it will be deemed that “Market
Quotation” or the “Second Method”, as the case may be, shall apply.  The amount, if any, payable in respect of an
Early Termination Date and determined pursuant to this Section will be
subject to any Set-off.

 

(i)                                     Events of Default.  If the Early Termination Date results from
an Event of Default:—

 

(1)                                  First Method
and Market Quotation.  If the
First Method and Market Quotation apply, the Defaulting Party will pay to the
Non-defaulting Party the excess, if a positive number, of (A) the sum of the
Settlement Amount (determined by the Non-defaulting Party) in respect of the
Terminated Transactions and the Termination Currency Equivalent of the Unpaid
Amounts owing to the Non-defaulting Party over (B) the Termination Currency
Equivalent of the Unpaid Amounts owing to the Defaulting Party.

 

(2)                                  First Method
and Loss.  If the First
Method and Loss apply, the Defaulting Party will pay to the Non-defaulting
Party, if a positive number, the Non-defaulting Party’s Loss in respect of this
Agreement.

 

(3)                                  Second
Method and Market Quotation. 
If the Second Method and Market Quotation apply, an amount will be payable
equal to (A) the sum of the Settlement Amount (determined by the

 

9

 

Non-defaulting Party) in
respect of the Terminated Transactions and the Termination Currency Equivalent
of the Unpaid Amounts owing to the Non-defaulting Party less (B) the
Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting
Party.  If that amount is a positive
number, the Defaulting Party will pay it to the Non-defaulting Party; if it is
a negative number, the Non-defaulting Party will pay the absolute value of that
amount to the Defaulting Party.

 

(4)                                  Second
Method and Loss.  If the
Second Method and Loss apply, an amount will be payable equal to the
Non-defaulting Party’s Loss in respect of this Agreement.  If that amount is a positive number, the
Defaulting Party will pay it to the Non-defaulting Party; if it is a negative
number, the Non-defaulting Party will pay the absolute value of that amount to
the Defaulting Party.

 

(ii)                                  Termination Events.  If the Early Termination Date results from a
Termination Event:—

 

(1)                                  One Affected
Party.  If there is one
Affected Party, the amount payable will be determined in accordance with
Section 6(e)(i)(3), if Market Quotation applies, or
Section 6(e)(i)(4), if Loss applies, except that, in either case,
references to the Defaulting Party and to the Non-defaulting Party will be
deemed to be references to the Affected Party and the party which is not the
Affected Party, respectively, and, if Loss applies and fewer than all the
Transactions are being terminated, Loss shall be calculated in respect of all
Terminated Transactions.

 

(2)                                  Two Affected
Parties.  If there are two
Affected Parties:—

 

(A)                              if
Market Quotation applies, each party will determine a Settlement Amount in respect
of the Terminated Transactions, and an amount will be payable equal to (I) the
sum of (a) one-half of the difference between the Settlement Amount of the
party with the higher Settlement Amount (“X”) and the Settlement Amount of the
party with the lower Settlement Amount (“Y”) and (b) the Termination Currency
Equivalent of the Unpaid Amounts owing to X less (II) the Termination Currency
Equivalent of the Unpaid Amounts owing to Y; and

 

(B)                                if
Loss applies, each party will determine its Loss in respect of this Agreement
(or, if fewer than all the Transactions are being terminated, in respect of all
Terminated Transactions) and an amount will be payable equal to one-half of the
difference between the Loss of the party with the higher Loss (“X”) and the Loss
of the party with the lower Loss (“Y”).

 

If the amount payable is
a positive number, Y will pay it to X; if it is a negative number, X will pay
the absolute value of that amount to Y.

 

(iii)                               Adjustment for Bankruptcy.  In circumstances where an Early Termination
Date occurs because “Automatic Early Termination” applies in respect of a
party, the amount determined under this Section 6(e) will be subject to
such adjustments as are appropriate and permitted by law to reflect any
payments or deliveries made by one party to the other under this Agreement (and
retained by such other party) during the period from the relevant Early
Termination Date to the date for payment determined under
Section 6(d)(ii).

 

(iv)                              Pre-Estimate.  The parties agree that if Market Quotation
applies an amount recoverable under this Section 6(e) is a reasonable
pre-estimate of loss and not a penalty. 
Such amount is payable for the loss of bargain and the loss of
protection against future risks and except as otherwise provided in this Agreement
neither party will be entitled to recover any additional damages as a
consequence of such losses.

 

10

 

7.                                      Transfer

 

Subject to
Section 6(b)(ii), neither this Agreement nor any interest or obligation in
or under this Agreement may be transferred (whether by way of security or
otherwise) by either party without the prior written consent of the other
party, except that:—

 

(a)                                  a
party may make such a transfer of this Agreement pursuant to a consolidation or
amalgamation with, or merger with or into, or transfer of all or substantially
all its assets to, another entity (but without prejudice to any other right or
remedy under this Agreement); and

 

(b)                                 a
party may make such a transfer of all or any part of its interest in any amount
payable to it from a Defaulting Party under Section 6(e).

 

Any purported transfer
that is not in compliance with this Section will be void.

 

8.                                      Contractual
Currency

 

(a)                                  Payment in the Contractual Currency.  Each payment under this Agreement will be
made in the relevant currency specified in this Agreement for that payment (the
“Contractual Currency”).  To the extent
permitted by applicable law, any obligation to make payments under this Agreement
in the Contractual Currency will not be discharged or satisfied by any tender
in any currency other than the Contractual Currency, except to the extent such
tender results in the actual receipt by the party to which payment is owed,
acting in a reasonable manner and in good faith in converting the currency so
tendered into the Contractual Currency, of the full amount in the Contractual
Currency of all amounts payable in respect of this Agreement.  If for any reason the amount in the
Contractual Currency so received falls short of the amount in the Contractual
Currency payable in respect of this Agreement, the party required to make the
payment will, to the extent permitted by applicable law, immediately pay such
additional amount in the Contractual Currency as may be necessary to compensate
for the shortfall.  If for any reason
the amount in the Contractual Currency so received exceeds the amount in the
Contractual Currency payable in respect of this Agreement, the party receiving
the payment will refund promptly the amount of such excess.

 

(b)                                 Judgments.  To the extent permitted by applicable law,
if any judgment or order expressed in a currency other than the Contractual
Currency is rendered (i) for the payment of any amount owing in respect of this
Agreement, (ii) for the payment of any amount relating to any early termination
in respect of this Agreement or (iii) in respect of a judgment or order of
another court for the payment of any amount described in (i) or (ii) above, the
party seeking recovery, after recovery in full of the aggregate amount to which
such party is entitled pursuant to the judgment or order, will be entitled to
receive immediately from the other party the amount of any shortfall of the
Contractual Currency received by such party as a consequence of sums paid in
such other currency and will refund promptly to the other party any excess of
the Contractual Currency received by such party as a consequence of sums paid
in such other currency if such shortfall or such excess arises or results from
any variation between the rate of exchange at which the Contractual Currency is
converted into the currency of the judgment or order for the purposes of such
judgment or order and the rate of exchange at which such party is able, acting
in a reasonable manner and in good faith in converting the currency received
into the Contractual Currency, to purchase the Contractual Currency with the
amount of the currency of the judgment or order actually received by such
party.  The term “rate of exchange”
includes, without limitation, any premiums and costs of exchange payable in
connection with the purchase of or conversion into the Contractual Currency.

 

(c)                                  Separate Indemnities.  To the extent permitted by applicable law,
these indemnities constitute separate and independent obligations from the
other obligations in this Agreement, will be enforceable as separate and
independent causes of action, will apply notwithstanding any indulgence granted
by the party to which any payment is owed and will not be affected by judgment
being obtained or claim or proof being made for any other sums payable in
respect of this Agreement.

 

(d)                                 Evidence of Loss.  For the purpose of this Section 8, it
will be sufficient for a party to demonstrate that it would have suffered a
loss had an actual exchange or purchase been made.

 

11

 

9.                                      Miscellaneous

 

(a)                                  Entire Agreement.  This Agreement constitutes the entire
agreement and understanding of the parties with respect to its subject matter
and supersedes all oral communication and prior writings with respect thereto.

 

(b)                                 Amendments.  No amendment, modification or waiver in
respect of this Agreement will be effective unless in writing (including a
writing evidenced by a facsimile transmission) and executed by each of the parties
or confirmed by an exchange of telexes or electronic messages on an electronic
messaging system.

 

(c)                                  Survival of Obligations.  Without prejudice to Sections 2(a)(iii) and
6(c)(ii), the obligations of the parties under this Agreement will survive the
termination of any Transaction.

 

(d)                                 Remedies Cumulative.  Except as provided in this Agreement, the
rights, powers, remedies and privileges provided in this Agreement are
cumulative and not exclusive of any rights, powers, remedies and privileges
provided by law.

 

(e)                                  Counterparts and Confirmations.

 

(i)                                     This
Agreement (and each amendment, modification and waiver in respect of it) may be
executed and delivered in counterparts (including by facsimile transmission),
each of which will be deemed an original.

 

(ii)                                  The
parties intend that they are legally bound by the terms of each Transaction
from the moment they agree to those terms (whether orally or otherwise).  A Confirmation shall he entered into as soon
as practicable and may he executed and delivered in counterparts (including by
facsimile transmission) or be created by an exchange of telexes or by an
exchange of electronic messages on an electronic messaging system, which in
each case will be sufficient for all purposes to evidence a binding supplement
to this Agreement.  The parties will
specify therein or through another effective means that any such counterpart,
telex or electronic message constitutes a Confirmation.

 

(f)                                    No Waiver of Rights.  A failure or delay in exercising any right,
power or privilege in respect of this Agreement will not be presumed to operate
as a waiver, and a single or partial exercise of any right, power or privilege
will not be presumed to preclude any subsequent or further exercise, of that
right, power or privilege or the exercise of any other right, power or
privilege.

 

(g)                                 Headings.  The headings used in this Agreement are for
convenience of reference only and are not to affect the construction of or to
be taken into consideration in interpreting this Agreement.

 

10.                               Offices;
Multibranch Parties

 

(a)                                  If
Section 10(a) is specified in the Schedule as applying, each party
that enters into a Transaction through an Office other than its head or home
office represents to the other party that, notwithstanding the place of booking
office or jurisdiction of incorporation or organisation of such party, the
obligations of such party are the same as if it had entered into the
Transaction through its head or home office. This representation will be deemed
to be repeated by such party on each date on which a Transaction is entered
into.

 

(b)                                 Neither
party may change the Office through which it makes and receives payments or
deliveries for the purpose of a Transaction without the prior written consent
of the other party.

 

(c)                                  If
a party is specified as a Multibranch Party in the Schedule, such Multibranch
Party may make and receive payments or deliveries under any Transaction through
any Office listed in the Schedule, and the Office through which it makes and
receives payments or deliveries with respect to a Transaction will be specified
in the relevant Confirmation.

 

11.                               Expenses

 

A Defaulting Party will,
on demand, indemnify and hold harmless the other party for and against all
reasonable out-of-pocket expenses, including legal fees and Stamp Tax, incurred
by such other party by reason of the enforcement and protection of its rights
under this Agreement or any Credit Support Document

 

12

 

to which the Defaulting
Party is a party or by reason of the early termination of any Transaction,
including, but not limited to, costs of collection.

 

12.                               Notices

 

(a)                                  Effectiveness.  Any notice or other communication in respect
of this Agreement may be given in any manner set forth below (except that a notice
or other communication under Section 5 or 6 may not be given by facsimile
transmission or electronic messaging system) to the address or number or in
accordance with the electronic messaging system details provided (see the
Schedule) and will be deemed effective as indicated:—

 

(i)                                     if
in writing and delivered in person or by courier, on the date it is delivered;

 

(ii)                                  if
sent by telex, on the date the recipient’s answerback is received;

 

(iii)                               if
sent by facsimile transmission, on the date that transmission is received by a
responsible employee of the recipient in legible form (it being agreed that the
burden of proving receipt will be on the sender and will not be met by a
transmission report generated by the sender’s facsimile machine);

 

(iv)                              if
sent by certified or registered mail (airmail, if overseas) or the equivalent
(return receipt requested), on the date that mail is delivered or its delivery
is attempted; or

 

(v)                                 if
sent by electronic messaging system, on the date that electronic message is
received,

 

unless the date of that
delivery (or attempted delivery) or that receipt, as applicable, is not a Local
Business Day or that communication is delivered (or attempted) or received, as
applicable, after the close of business on a Local Business Day, in which case
that communication shall be deemed given and effective on the first following
day that is a Local Business Day.

 

(b)                                 Change of Addresses.  Either party may by notice to the other
change the address, telex or facsimile number or electronic messaging system
details at which notices or other communications are to be given to it.

 

13.                               Governing
Law and Jurisdiction

 

(a)                                  Governing Law.  This Agreement will be governed by and
construed in accordance with the law specified in the Schedule.

 

(b)                                 Jurisdiction.  With respect to any suit, action or
proceedings relating to this Agreement (“Proceedings”), each party
irrevocably:—

 

(i)                                     submits
to the jurisdiction of the English courts, if this Agreement is expressed to be
governed by English law, or to the non-exclusive jurisdiction of the courts of
the State of New York and the United States District Court located in the
Borough of Manhattan in New York City, if this Agreement is expressed to be
governed by the laws of the State of New York; and

 

(ii)                                  waives
any objection which it may have at any time to the laying of venue of any
Proceedings brought in any such court, waives any claim that such Proceedings
have been brought in an inconvenient forum and further waives the right to
object, with respect to such Proceedings, that such court does not have any
jurisdiction over such party.

 

Nothing in this Agreement
precludes either party from bringing Proceedings in any other jurisdiction
(outside, if this Agreement is expressed to be governed by English law, the Contracting
States, as defined in Section 1(3) of the Civil Jurisdiction and Judgments
Act 1982 or any modification, extension or re-enactment thereof for the time
being in force) nor will the bringing of Proceedings in any one or more
jurisdictions preclude the bringing of Proceedings in any other jurisdiction.

 

(c)                                  Service of Process.  Each party irrevocably appoints the Process
Agent (if any) specified opposite its name in the Schedule to receive, for
it and on its behalf, service of process in any Proceedings.  If for any

 

13

 

reason any party’s
Process Agent is unable to act as such, such party will promptly notify the
other party and within 30 days appoint a substitute process agent acceptable to
the other party.  The parties
irrevocably consent to service of process given in the manner provided for
notices in Section 12.  Nothing in
this Agreement will affect the right of either party to serve process in any
other manner permitted by law.

 

(d)                                 Waiver of Immunities.  Each party irrevocably waives, to the
fullest extent permitted by applicable law, with respect to itself and its
revenues and assets (irrespective of their use or intended use), all immunity
on the grounds of sovereignty or other similar grounds from (i) suit, (ii)
jurisdiction of any court, (iii) relief by way of injunction, order for
specific performance or for recovery of property, (iv) attachment of its assets
(whether before or after judgment) and (v) execution or enforcement of any
judgment to which it or its revenues or assets might otherwise be entitled in
any Proceedings in the courts of any jurisdiction and irrevocably agrees, to
the extent permitted by applicable law, that it will not claim any such
immunity in any Proceedings.

 

14.                               Definitions

 

As used in this
Agreement:—

 

“Additional Termination Event” has the
meaning specified in Section 5(b).

 

“Affected Party” has the meaning
specified in Section 5(b).

 

“Affected Transactions” means (a) with
respect to any Termination Event consisting of an Illegality, Tax Event or Tax
Event Upon Merger, all Transactions affected by the occurrence of such
Termination Event and (b) with respect to any other Termination Event, all
Transactions.

 

“Affiliate” means, subject to the
Schedule, in relation to any person, any entity controlled, directly or
indirectly, by the person, any entity that controls, directly or indirectly,
the person or any entity directly or indirectly under common control with the
person.  For this purpose, “control” of
any entity or person means ownership of a majority of the voting power of the
entity or person.

 

“Applicable Rate” means:—

 

(a)                                  in
respect of obligations payable or deliverable (or which would have been but for
Section 2(a)(iii)) by a Defaulting Party, the Default Rate;

 

(b)                                 in
respect of an obligation to pay an amount under Section 6(e) of either
party from and after the date (determined in accordance with
Section 6(d)(ii)) on which that amount is payable, the Default Rate;

 

(c)                                  in
respect of all other obligations payable or deliverable (or which would have
been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default
Rate; and

 

(d)                                 in
all other cases, the Termination Rate.

 

“Burdened Party” has the meaning
specified in Section 5(b).

 

“Change in Tax Law” means
the enactment, promulgation, execution or ratification of, or any change in or
amendment to, any law (or in the application or official interpretation of any
law) that occurs on or after the date on which the relevant Transaction is
entered into.

 

“consent” includes a consent,
approval, action, authorisation, exemption, notice, filing, registration or
exchange control consent.

 

“Credit Event Upon Merger” has the
meaning specified in Section 5(b).

 

“Credit Support Document” means any
agreement or instrument that is specified as such in this Agreement.

 

“Credit Support Provider” has the
meaning specified in the Schedule.

 

“Default Rate” means a rate per annum
equal to the cost (without proof or evidence of any actual cost) to the
relevant payee (as certified by it) if it were to fund or of funding the
relevant amount plus 1% per annum.

 

14

 

“Defaulting Party” has the meaning
specified in Section 6(a).

 

“Early Termination Date” means the
date determined in accordance with Section 6(a) or 6(b)(iv).

 

“Event of Default” has the meaning
specified in Section 5(a) and, if applicable, in the Schedule.

 

“Illegality” has the meaning specified
in Section 5(b).

 

“Indemnifiable Tax” means any Tax
other than a Tax that would not be imposed in respect of a payment under this
Agreement but for a present or former connection between the jurisdiction of
the government or taxation authority imposing such Tax and the recipient of
such payment or a person related to such recipient (including, without
limitation, a connection arising from such recipient or related person being or
having been a citizen or resident of such jurisdiction, or being or having been
organised, present or engaged in a trade or business in such jurisdiction, or
having or having had a permanent establishment or fixed place of business in
such jurisdiction, but excluding a connection arising solely from such
recipient or related person having executed, delivered, performed its
obligations or received a payment under, or enforced, this Agreement or a
Credit Support Document).

 

“law” includes any treaty, law, rule
or regulation (as modified, in the case of tax matters, by the practice of any
relevant governmental revenue authority) and “lawful” and “unlawful” will be
construed accordingly.

 

“Local Business Day” means, subject to
the Schedule, a day on which commercial banks are open for business (including
dealings in foreign exchange and foreign currency deposits) (a) in relation to
any obligation under Section 2(a)(i), in the place(s) specified in the
relevant Confirmation or, if not so specified, as otherwise agreed by the
parties in writing or determined pursuant to provisions contained, or
incorporated by reference, in this Agreement, (b) in relation to any other
payment, in the place where the relevant account is located and, if different,
in the principal financial centre, if any, of the currency of such payment, (c)
in relation to any notice or other communication, including notice contemplated
under Section 5(a)(i), in the city specified in the address for notice
provided by the recipient and, in the case of a notice contemplated by
Section 2(b), in the place where the relevant new account is to be located
and (d) in relation to Section 5(a)(v)(2), in the relevant locations for
performance with respect to such Specified Transaction.

 

“Loss” means, with respect to this
Agreement or one or more Terminated Transactions, as the case may be, and a
party, the Termination Currency Equivalent of an amount that party reasonably
determines in good faith to be its total losses and costs (or gain, in which
case expressed as a negative number) in connection with this Agreement or that
Terminated Transaction or group of Terminated Transactions, as the case may be,
including any loss of bargain, cost of funding or, at the election of such
party but without duplication, loss or cost incurred as a result of its
terminating, liquidating, obtaining or reestablishing any hedge or related
trading position (or any gain resulting from any of them).  Loss includes losses and costs (or gains) in
respect of any payment or delivery required to have been made (assuming
satisfaction of each applicable condition precedent) on or before the relevant
Early Termination Date and not made, except, so as to avoid duplication, if
Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies.  Loss does not include a party’s legal fees
and out-of-pocket expenses referred to under Section 11.  A party will determine its Loss as of the
relevant Early Termination Date, or, if that is not reasonably practicable, as
of the earliest date thereafter as is reasonably practicable.  A party may (but need not) determine its
Loss by reference to quotations of relevant rates or prices from one or more
leading dealers in the relevant markets.

 

“Market Quotation” means, with respect
to one or more Terminated Transactions and a party making the determination, an
amount determined on the basis of quotations from Reference Market-makers.  Each quotation will be for an amount, if any,
that would be paid to such party (expressed as a negative number) or by such
party (expressed as a positive number) in consideration of an agreement between
such party (taking into account any existing Credit Support Document with
respect to the obligations of such party) and the quoting Reference
Market-maker to enter into a transaction (the “Replacement Transaction”) that
would have the effect of preserving for such party the economic equivalent of
any payment or delivery (whether the underlying obligation was absolute or
contingent and assuming the satisfaction of each applicable condition
precedent) by the parties under Section 2(a)(i) in respect of such
Terminated Transaction or group of Terminated Transactions that would, but for
the occurrence of the relevant Early Termination Date, have

 

15

 

been required after that
date.  For this purpose, Unpaid Amounts
in respect of the Terminated Transaction or group of Terminated Transactions
are to be excluded but, without limitation, any payment or delivery that would,
but for the relevant Early Termination Date, have been required (assuming
satisfaction of each applicable condition precedent) after that Early
Termination Date is to be included.  The
Replacement Transaction would be subject to such documentation as such party
and the Reference Market-maker may, in good faith, agree.  The party making the determination (or its
agent) will request each Reference Market-maker to provide its quotation to the
extent reasonably practicable as of the same day and time (without regard to
different time zones) on or as soon as reasonably practicable after the
relevant Early Termination Date.  The
day and time as of which those quotations are to be obtained will be selected
in good faith by the party obliged to make a determination under
Section 6(e), and, if each party is so obliged, after consultation with
the other.  If more than three
quotations are provided, the Market Quotation will be the arithmetic mean of
the quotations, without regard to the quotations having the highest and lowest
values.  If exactly three such
quotations are provided, the Market Quotation will be the quotation remaining
after disregarding the highest and lowest quotations.  For this purpose, if more than one quotation has the same highest
value or lowest value, then one of such quotations shall be disregarded.  If fewer than three quotations are provided,
it will be deemed that the Market Quotation in respect of such Terminated
Transaction or group of Terminated Transactions cannot be determined.

 

“Non-default Rate” means a rate per
annum equal to the cost (without proof or evidence of any actual cost) to the
Non-defaulting Party (as certified by it) if it were to fund the relevant
amount.

 

“Non-defaulting Party” has the meaning
specified in Section 6(a).

 

“Office” means a branch or office of a
party, which may be such party’s head or home office.

 

“Potential Event of Default” means any
event which, with the giving of notice or the lapse of time or both, would
constitute an Event of Default.

 

“Reference Market-makers” means four
leading dealers in the relevant market selected by the party determining a
Market Quotation in good faith (a) from among dealers of the highest credit
standing which satisfy all the criteria that such party applies generally at
the time in deciding whether to offer or to make an extension of credit and (b)
to the extent practicable, from among such dealers having an office in the same
city.

 

“Relevant Jurisdiction” means, with
respect to a party, the jurisdictions (a) in which the party is incorporated,
organised, managed and controlled or considered to have its seat, (b) where an
Office through which the party is acting for purposes of this Agreement is
located, (c) in which the party executes this Agreement and (d) in relation to
any payment, from or through which such payment is made.

 

“Scheduled Payment Date” means a date
on which a payment or delivery is to be made under Section 2(a)(i) with
respect to a Transaction.

 

“Set-off” means set-off, offset,
combination of accounts, right of retention or withholding or similar right or
requirement to which the payer of an amount under Section 6 is entitled or
subject (whether arising under this Agreement, another contract, applicable law
or otherwise) that is exercised by, or imposed on, such payer.

 

“Settlement Amount” means, with
respect to a party and any Early Termination Date, the sum of:—

 

(a)                                  the
Termination Currency Equivalent of the Market Quotations (whether positive or
negative) for each Terminated Transaction or group of Terminated Transactions
for which a Market Quotation is determined; and

 

(b)                                 such
party’s Loss (whether positive or negative and without reference to any Unpaid
Amounts) for each Terminated Transaction or group of Terminated Transactions
for which a Market Quotation cannot be determined or would not (in the
reasonable belief of the party making the determination) produce a commercially
reasonable result.

 

“Specified Entity” has the meanings
specified in the Schedule.

 

16

 

“Specified Indebtedness” means,
subject to the Schedule, any obligation (whether present or future, contingent
or otherwise, as principal or surety or otherwise) in respect of borrowed
money.

 

“Specified Transaction” means, subject
to the Schedule, (a) any transaction (including an agreement with respect
thereto) now existing or hereafter entered into between one party to this
Agreement (or any Credit Support Provider of such party or any applicable
Specified Entity of such party) and the other party to this Agreement (or any
Credit Support Provider of such other party or any applicable Specified Entity
of such other party) which is a rate swap transaction, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency
option or any other similar transaction (including any option with respect to
any of these transactions), (b) any combination of these transactions and (c)
any other transaction identified as a Specified Transaction in this Agreement
or the relevant confirmation.

 

“Stamp Tax” means any stamp,
registration, documentation or similar tax.

 

“Tax” means any present or future tax,
levy, impost, duty, charge, assessment or fee of any nature (including
interest, penalties and additions thereto) that is imposed by any government or
other taxing authority in respect of any payment under this Agreement other
than a stamp, registration, documentation or similar tax.

 

“Tax Event” has the meaning specified
in Section 5(b).

 

“Tax Event Upon Merger” has the
meaning specified in Section 5(b).

 

“Terminated Transactions” means with
respect to any Early Termination Date (a) if resulting from a Termination
Event, all Affected Transactions and (b) if resulting from an Event of Default,
all Transactions (in either case) in effect immediately before the
effectiveness of the notice designating that Early Termination Date (or, if
“Automatic Early Termination” applies, immediately before that Early
Termination Date).

 

“Termination Currency” has the meaning
specified in the Schedule.

 

“Termination Currency Equivalent”
means, in respect of any amount denominated in the Termination Currency, such
Termination Currency amount and, in respect of any amount denominated in a
currency other than the Termination Currency (the “Other Currency”), the amount
in the Termination Currency determined by the party making the relevant
determination as being required to purchase such amount of such Other Currency
as at the relevant Early Termination Date, or, if the relevant Market Quotation
or Loss (as the case may be), is determined as of a later date, that later
date, with the Termination Currency at the rate equal to the spot exchange rate
of the foreign exchange agent (selected as provided below) for the purchase of
such Other Currency with the Termination Currency at or about 11:00 a.m. (in
the city in which such foreign exchange agent is located) on such date as would
be customary for the determination of such a rate for the purchase of such
Other Currency for value on the relevant Early Termination Date or that later
date.  The foreign exchange agent will,
if only one party is obliged to make a determination under Section 6(e),
be selected in good faith by that party and otherwise will be agreed by the
parties.

 

“Termination Event” means an
Illegality, a Tax Event or a Tax Event Upon Merger or, if specified to be
applicable, a Credit Event Upon Merger or an Additional Termination Event.

 

“Termination Rate” means a rate per
annum equal to the arithmetic mean of the cost (without proof or evidence of
any actual cost) to each party (as certified by such party) if it were to fund
or of funding such amounts.

 

“Unpaid Amounts” owing to any party
means, with respect to an Early Termination Date, the aggregate of (a) in
respect of all Terminated Transactions, the amounts that became payable (or
that would have become payable but for Section 2(a)(iii)) to such party
under Section 2(a)(i) on or prior to such Early Termination Date and which
remain unpaid as at such Early Termination Date and (b) in respect of each
Terminated Transaction, for each obligation under Section 2(a)(i) which
was (or would have been but for Section 2(a)(iii)) required to be settled
by delivery to such party on or prior to such Early Termination Date and which
has not been so settled as at such Early Termination Date, an amount equal to
the fair market

 

17

 

value of that which was
(or would have been) required to be delivered as of the originally scheduled
date for delivery, in each case together with (to the extent permitted under
applicable law) interest, in the currency, of such amounts, from (and
including) the date such amounts or obligations were or would have been
required to have been paid or performed to (but excluding) such Early
Termination Date, at the Applicable Rate. Such amounts of interest will be
calculated on the basis of daily compounding and the actual number of days
elapsed. The fair market value of any obligation referred to in clause (b) above
shall be reasonably determined by the party obliged to make the determination
under Section 6(e) or, if each party is so obliged, it shall be the
average of the Termination Currency Equivalents of the fair market values
reasonably determined by both parties.

 

IN WITNESS WHEREOF the
parties have executed this document on the respective dates specified below
with effect from the date specified on the first page of this document.

 

 

	
  Barclays Bank PLC (“Barclays”)

  (Name of Party)

  	
   

  	
  World Financial Network Credit Card
  Master

  Note Trust (“Counterparty”)

  
	
   

  	
   

  
	
   

  	
  By:

  	
  Chase Manhattan Bank USA, National

  
	
   

  	
   

  	
  Association, not in its individual capacity, but

  
	
   

  	
   

  	
  solely as Owner Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
  (Name of Party)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Justin Wray

  	
   

  	
  By:

  	
  /s/ John J. Cashin

  	
   

  
	
   

  	
  Name: Justin Wray

  	
   

  	
   

  	
  Name: John J. Cashin

  	
   

  
	
   

  	
  Title: Director

  	
   

  	
   

  	
  Title: Vice President

  	
   

  
	
   

  	
  Date:
  September 22, 2004

  	
   

  	
   

  	
  Date:
  September 22, 2004

  	
   

  
							

 

 

CLASS M SWAP

 

 

SCHEDULE

to the

Master Agreement

 

dated as of
September 22, 2004

 

between

 

	
  Barclays Bank PLC

  	
   

  	
  and

  	
   

  	
  World Financial Network

  
	
   

  	
   

  	
   

  	
   

  	
  Credit Card

  
	
   

  	
   

  	
   

  	
   

  	
  Master Note Trust

  
	
  (“Barclays”)

  	
   

  	
   

  	
   

  	
  (the “Counterparty”)

  

 

 

The only Transaction that
will be governed by the terms of this Agreement will be the Class M Swap (as
defined in the Indenture).  References
in the Agreement to “Transactions” or “Transaction” shall be deemed to be
references to the Class M Swap.

 

Part 1

 

Termination Provisions

 

In this Agreement:-

 

(1)                                  “Specified
Entity” shall not apply.

 

(2)                                  The
“Breach of Agreement” provisions of Section 5(a)(ii) will apply to
Barclays and will not apply to the Counterparty.

 

(3)                                  The
“Credit Support Default” provisions of Section 5(a)(iii) will apply to
Barclays and will not apply to the Counterparty.

 

(4)                                  The
“Misrepresentation” provisions of Section 5(a)(iv) will apply to Barclays
and will not apply to the Counterparty.

 

(5)                                  The
“Default Under Specified Transaction” provisions of Section 5(a)(v) will
not apply to Barclays and will not apply to the Counterparty.

 

(6)                                  The
“Cross Default” provisions of Section 5(a)(vi) will not apply to Barclays
and will not apply to the Counterparty.

 

(7)                                  The
“Merger Without Assumption” provisions of Section 5(a)(viii) will apply to
Barclays and will not apply to the Counterparty.

 

 

(8)                                  The
“Tax Event” provisions of Section 5(b)(ii) will not apply to Barclays and
will not apply to the Counterparty.

 

(9)                                  The
“Tax Event Upon Merger” provisions of Section 5(b)(iii) will not apply to
Barclays and will not apply to the Counterparty.

 

(10)                            The
“Credit Event Upon Merger” provisions of Section 5(b)(iv) will not apply
to Barclays and will not apply to the Counterparty.

 

(11)                            The
“Additional Termination Event” provisions of Section 5(b)(v) will apply as
set forth in Part 1(15) hereof.

 

(12)                            The
“Automatic Early Termination” provisions of Section 6(a) will not apply to
Barclays and will not apply to the Counterparty.

 

(13)                            “Termination
Currency” means United States Dollars.

 

(14)                            For
purposes of computing amounts payable on early termination:

 

(a)                                  Market
Quotation will apply to this Agreement; and

 

(b)                                 The
Second Method will apply to this Agreement.

 

(15)                            The
occurrence of the following event shall constitute an “Additional Termination
Event” for purposes of Section 5(b)(v):

 

(a) the occurrence of an
Additional Termination Event as forth in Part 5 (10) hereof.  If this Additional Termination Event occurs,
Barclays shall be the sole Affected Party and all Transactions then outstanding
between the parties shall be Affected Transactions.

 

Upon the occurrence of an
Additional Termination Event, Barclays shall notify the Rating Agencies of such
occurrence.

 

Part 2

 

Tax Representations

 

(1)                                  Payer
Tax Representation:

 

For the purpose of
Section 3(e) of this Agreement, Barclays and Counterparty each make the
following representation:

 

It is not required by any
applicable law, as modified by the practice of any relevant governmental
revenue authority, of any Relevant Jurisdiction to make any deduction or
withholding for or on account of any Tax from any payment (other than interest
under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to be made by it
to the other party under this Agreement. 
In making this representation, it may rely on:

 

(i)                                     the
accuracy of any representations made by the other party pursuant to
Section 3(f) of this Agreement;

 

 

(ii)                                  the
satisfaction of the agreement of the other party contained in
Section 4(a)(i) or 4(a)(iii) of this Agreement and the accuracy and
effectiveness of any document provided by the other party pursuant to Section 4(a)(i)
or 4(a)(iii) of this Agreement; and

 

(iii)                               the
satisfaction of the agreement of the other party contained in Section 4(d)
of this Agreement, provided that it shall not be a breach of this
representation where reliance is placed on clause (ii) and the other party does
not deliver a form or document under Section 4(a)(iii) of this Agreement
by reason of material prejudice to its legal or commercial position.

 

(2)                                  Barclays
Payee Tax Representations:

 

For the purpose of
Section 3(f), Barclays makes the following representations, which apply to
Barclays with respect to that portion of its payments that are not attributable
to Barclays’ U.S. trade or business:

 

(i)                                     With
respect to payments made to Barclays that are not effectively connected to the
United States: It is a non-U.S. branch of a foreign person for United States
federal income tax purposes;

 

(ii)                                  With
respect to payments made to Barclays that are effectively connected to the
United States: Each payment received or to be received by it in connection with
this Agreement will be effectively connected with its conduct of a trade or
business in the United States; and

 

(iii)                               Each
payment received or to be received by Barclays in connection with this
Agreement may, in whole or in part, be effectively connected with the conduct
of a trade or business by Barclays in the United States and the Counterparty
may treat the full amount of each such payment as effectively connected with
the conduct of a trade or business by Barclays in the United States for United
States information reporting purposes.

 

(3)                                  Counterparty
Payee Tax Representations:

 

For the purpose of
Section 3(f), the Counterparty represents that it is a United States
Person for U.S. federal income tax purposes and either (a) is a financial institution
or (b) is not acting as an agent for a person that is not a United States
Person for U.S. federal income tax purposes.

 

Part 3

 

Agreement to Deliver Documents

 

For the purpose of
Sections 4(a)(i) and (ii), each party agrees to deliver the following
documents, as applicable:

 

(1)                                  For
the purpose of Sections 4(a)(i) and (ii) of this Agreement, Counterparty agrees
to deliver a complete and accurate United States Internal Revenue Service Form
W-9 (or any applicable successor form), in a manner reasonably satisfactory to
Barclays, (I) upon execution of this Agreement; (II) promptly upon reasonable
demand of Barclays, and (III) 

 

 

promptly upon learning
that any such form previously filed by Counterparty has become obsolete or
incorrect.

 

(2)                                  Barclays
will, on demand, deliver a certificate (or, if available, the current
authorized signature book of Barclays) specifying the names, title and specimen
signatures of the persons authorized to execute this Agreement and each
Confirmation on its behalf.

 

(3)                                  The
Counterparty will, on demand, deliver a certificate (or, if available, the
current authorized signature book of the Counterparty) specifying the names,
title and specimen signatures of the persons authorized to execute this
Agreement and each Confirmation on its behalf.

 

(4)                                  The
Counterparty will, upon execution of this Agreement, deliver a conformed copy
of the Indenture and the Indenture Supplement.

 

(5)                                  Each
party will, upon execution of this Agreement, deliver a legal opinion of
counsel in form and substance satisfactory to the other party regarding this
Agreement and any other matters as such other party may reasonably request.

 

(6)                                  The
Counterparty shall supply (and/or shall instruct the Trustee to supply)
Barclays with copies of the monthly servicing reports delivered to the Series
2004-C Noteholders in the form specified in the Indenture.  Copies of such accountings and/or reports
shall be delivered to Barclays at the following address:

 

	
  Barclays Bank PLC

  	
   

  
	
  5 The North Colonnade

  	
   

  
	
  Canary Wharf

  	
   

  
	
  E14 4BB

  	
   

  
	
  e-mail address:

  	
  bgsoperations@barcap.com

  

 

Each of the foregoing
documents (other than the legal opinions described in (5) above) is covered by
the representation contained in Section 3(d) of this Agreement.

 

Part 4

 

Miscellaneous

 

(1)                                  Governing Law.  This Agreement will be governed by and
construed in accordance with the laws of the State of New York without
reference to choice of law doctrine.

 

(2)                                  Notices.

 

(a)                                  In
connection with Section 12(a), all notices to Barclays shall, with respect
to any particular Transaction, be sent to the address, telex number or
facsimile number specified in the relevant Confirmation and any notice for
purposes of Sections 5 or 6 of the Agreement shall be sent to the address or
telex number specified below:

 

Barclays Bank PLC

Attention:  Swaps Documentation

5 The North Colonnade

Canary Wharf

 

 

E14 4BB

Telephone No.: 44 (20)
7773 6810

Facsimile No.:  44 (20) 7773 6461

 

(b)                                 In
connection with Section 12(a), all notices to the Counterparty shall, with
respect to any particular Transaction, be sent to the address, telex number or
facsimile number specified in the relevant Confirmation and any notice for
purposes of Sections 5 or 6 of the Agreement shall be sent to the address or
telex number specified below:

 

World Financial Network
Credit Card Master Note Trust

c/o JP Morgan Chase Bank

4 New York Plaza

15th Floor

New York, NY  10004

Attention: Institutional Trust Services

Telephone No.:

Facsimile No.:

 

With a copy to:

 

World Financial Network
National Bank

800 Techcenter Drive

Gahanna, OH 43230

Attention:  Treasurer

Telephone No.:  614-729-4723

Facsimile No.:  614-729-4899

 

(3)                                  Netting of Payments.  Section 2(c)(ii) of this Agreement will
apply, with the effect that payment netting will not take place with respect to
amounts due and owing in respect of more than one Transaction.

 

(4)                                  Offices; Multibranch Party.  For purposes of Section 10:

 

(a)                                  Section 10(a)
will apply; and

 

(b)                                 For
the purpose of Section 10(c):

 

(i) Barclays is a
Multibranch Party and may act through its London and New York Offices.

 

(ii) The Counterparty is
not a Multibranch Party.

 

(5)                                  Credit Support Documents.

 

With respect to Barclays,
if applicable, any Third Party Credit Support Document delivered by Barclays
shall constitute a Credit Support Document.

 

With respect to Barclays
and the Counterparty, if applicable, any Approved Credit Support Document shall
constitute a Credit Support Document.

 

 

(6)                                  Credit Support Provider.

 

With respect to Barclays,
the party guaranteeing Barclays’ obligations pursuant to a Third Party Credit
Support Document, if any, shall be a Credit Support Provider.

 

(7)                                  Process Agents.  The Counterparty appoints as its Process
Agent for the purpose of Section 13(c):

 

Not applicable

 

Part 5

 

Other Provisions

 

(1)                                  ISDA Definitions.  Reference is hereby made to the 2000 ISDA
Definitions (the “ISDA Definitions”) each as published by the International
Swaps and Derivatives Association, Inc., which are hereby incorporated by
reference herein.  Any terms used and
not otherwise defined herein which are contained in the ISDA Definitions shall
have the meaning set forth therein.

 

(2)                                  Confirmation Procedures.  Each party acknowledges and agrees that the
Confirmation executed as of the date hereof and designated as Reference No.
610072B shall be the only Transaction governed by this Agreement (it being
understood that, in the event such Confirmation shall be amended (in any
respect), such amendment shall not constitute (for purposes of this paragraph)
a separate Transaction or a separate Confirmation).  Party A and Party B shall not enter into any additional
Confirmations or Transactions hereunder.

 

(3)                                  Inconsistency.  In the event of any inconsistency between
any of the following documents, the relevant document first listed below shall
govern:  (i) a Confirmation; (ii) the
Schedule; (iii) the ISDA Definitions; and (iv) the printed form of ISDA Master
Agreement.

 

(4)                                  Calculation Agent.  The Calculation Agent will be Barclays.

 

(5)                                  Waiver of Jury Trial.  Each party waives, to the fullest extent
permitted by applicable law, any right it may have to a trial by jury in
respect of any suit, action or proceeding relating to this Agreement or any
Credit Support Document.  Each party (i)
certifies that no representative, agent or attorney of the other party or any
Credit Support Provider has represented, expressly or otherwise, that such
other party would not, in the event of such a suit, action or proceeding, seek
to enforce the foregoing waiver and (ii) acknowledges that it and the other
party have been induced to enter into this Agreement and provide for any Credit
Support Document, as applicable, by, among other things, the mutual waivers and
certifications in this Section.

 

(6)                                  Severability.  In the event any one or more of the
provisions contained in this Agreement should be held invalid, illegal, or
unenforceable (in whole or in part) in any respect, the remaining terms,
provisions, covenants and conditions hereof shall continue in full force and
effect as if this Agreement had been executed with the invalid or unenforceable
portion eliminated, so long as this Agreement as so modified continues to
express, without material change the original intentions of the parties as to
the subject matter of this Agreement and the deletion of such portion of this
Agreement will not substantially impair the respective benefits or expectations
of the parties to this Agreement; provided, however, that this severability
provision shall not be applicable if any provision of

 

 

Section 2, 5, 6 or
13 (or any definition or provision in Section 14 to the extent it relates
to, or is used in or in connection with any such Section) shall be so held to
be invalid or unenforceable.

 

(7)                                  No Gross-up for Counterparty.  Section 2(d) of the Agreement shall not
apply with respect to the Counterparty so that the Counterparty shall not be
obligated to gross up pursuant thereto.

 

(8)                                  Barclays Acknowledgment.  Notwithstanding anything to the contrary in
this Agreement, Barclays hereby

 

(a) acknowledges and
agrees that the Counterparty has pledged its rights under this Agreement to the
Trustee pursuant to the Indenture and that in the event of an Event of Default
(as defined in the Indenture) the Trustee shall be entitled to exercise all
rights and remedies of a secured party with respect to this Agreement; and

 

(b) agrees that, unless
notified in writing by the Trustee of other payment instructions, any and all
amounts payable by Barclays to the Counterparty shall be paid to the Trustee.

 

(9)                                  No Petition; Limited Recourse.  Barclays hereby agrees that it
shall not institute against, or join any other Person in instituting against
the Counterparty any bankruptcy, reorganization, arrangement, insolvency,
moratorium or liquidation proceedings or other proceedings under U.S. federal
or state or other bankruptcy or similar laws. 
Notwithstanding the foregoing, nothing herein shall prevent Barclays
from participating in any such proceeding once commenced.

 

Barclays hereby
acknowledges and agrees that the Counterparty’s obligations hereunder will be
solely the limited recourse obligations of the Counterparty, and that Barclays
will not have any recourse to any of the directors, officers, employees,
shareholders or affiliates of the Counterparty with respect to any claims,
losses, damages, liabilities, indemnities or other obligations in connection
with any transactions contemplated hereby. 
Notwithstanding any other provisions hereof, recourse in respect of any
obligations of the Counterparty to Barclays hereunder or thereunder will be
limited to the Collateral, subject to and in accordance with the terms of the
priority of payments set forth in Section 4.4 of the Indenture Supplement,
and on the exhaustion thereof all claims against the Counterparty arising from
this Agreement or any other transactions contemplated hereby or thereby shall
be extinguished.

 

(10)                            Ratings Downgrade Provisions.   Unless written notification to the
contrary has been received from the Rating Agencies, following the occurrence
of a Ratings Event I and/or a Ratings Event II, the parties shall comply with
the following provisions, as applicable.

 

I.                                         If
a Ratings Event I shall occur and be continuing with respect to Barclays, then
Barclays shall, within 5 Local Business Days of the occurrence of such Ratings
Event I, give notice of the occurrence of such Ratings Event I to
Counterparty.  Following such notice,
Barclays may either

 

(A) at its sole option
and expense, provide, or cause to be provided, a Third Party Credit Support
Document to Counterparty; or

 

(B) at its sole option
and expense, use reasonable efforts to transfer Barclays’ rights and
obligations under the Agreement and all Confirmations to another party.

 

 

Each of I(A) and I(B)
above shall be subject to satisfaction of the Rating Agency Condition.

 

If, on or prior to the
date that is 30 calendar days after the occurrence of a Ratings Event I,
Barclays has provided a Third Party Credit Support Document as provided in I(A)
above and the Rating Agency Condition has been satisfied, then, for so long as
such Third Party Credit Support Document is in effect and the Rating Agency
Condition continues to be satisfied, Barclays shall have no further obligations
in respect of this Part 5(10)(I).

 

If,

 

(i) on or prior to the
date that is 30 calendar days after the occurrence of a Ratings Event I,
Barclays has not provided a Third Party Credit Support Document as provided in
I(A) above or transferred its rights and obligations as provided in I(B) above,
or

 

(ii) Barclays has
provided a Third Party Credit Support Document as provided in I(A) above but
such Third Party Credit Support Document has ceased to be in effect and/or the
Rating Agency Condition is no longer satisfied,

 

then, on the first Local
Business Day following the date that is 30 calendar days after the occurrence
of the Ratings Event I (in respect of (i) above) or on the first Local Business
Day following the date on which the Third Party Credit Support Document
referred to in (ii) above has ceased to be in effect and/or fails to satisfy
the Rating Agency Condition, Counterparty may demand that Barclays deliver
Eligible Collateral to Counterparty in accordance with the terms of an Approved
Credit Support Document. 
Notwithstanding the foregoing, Barclays’ obligations under this Part
5(10)(I) to post Eligible Collateral under the Approved Credit Support Document
shall remain in effect only for so long as a Ratings Event I is continuing with
respect to Barclays.

 

The failure by Barclays
to comply with the provisions hereof shall constitute an Additional Termination
Event, with Barclays as the sole Affected Party and all Transactions then
outstanding between the parties as Affected Transactions.

 

II.                                     If
a Ratings Event II shall occur and be continuing with respect to Barclays, then
Barclays shall, within 5 Local Business Days of the occurrence of such Ratings
Event II, give notice of the occurrence of such Ratings Event II to
Counterparty.  Following such notice,
Barclays shall either

 

(A) to the extent that is
has not already done so in accordance with Part 5(10)(I), at its sole option
and expense, provide, or cause to be provided, a Third Party Credit Support
Document to Counterparty; or

 

(B) at its sole option
and expense, use reasonable efforts to transfer Barclays’ rights and
obligations under the Agreement and all Confirmations to another party.

 

Each of II(A) and II(B)
above shall be subject to satisfaction of the Rating Agency Condition.

 

If, on or prior to the
date that is 30 calendar days after the occurrence of a Ratings Event II,
Barclays has provided a Third Party Credit Support Document as provided in
II(A) or

 

 

I(A) above and the Rating
Agency Condition has been satisfied, then, for so long as such Third Party
Credit Support Document is in effect and the Rating Agency Condition continues
to be satisfied, then, (i) Barclays shall have no further obligations in
respect of this Part 5(10)(II) and, (ii) if Barclays was delivering Eligible
Collateral to Counterparty in accordance with the terms of an Approved Credit
Support Document pursuant to the provisions of Part 5(10)(I) hereof, Barclays
shall have no further obligations to deliver Eligible Collateral under the
Approved Credit Support Document.

 

If,

 

(i) on or prior to the
date that is 30 calendar days after the occurrence of a Ratings Event II,
Barclays has not provided a Third Party Credit Support Document as provided in
II(A) above or transferred its rights and obligations as provided in II(B)
above, or

 

(ii) Barclays has
provided a Third Party Credit Support Document as provided in II(A) or I(A)
above but such Third Party Credit Support Document has ceased to be in effect
and/or the Rating Agency Condition is no longer satisfied,

 

then, on the first Local
Business Day following the date that is 30 calendar days after the occurrence
of the Ratings Event II (in respect of (i) above) or on the first Local
Business Day following the date on which the Third Party Credit Support
Document referred to in (ii) above has ceased to be in effect and/or fails to
satisfy the Rating Agency Condition, and only to the extent that Barclays is
not already delivering Eligible Collateral to Counterparty in accordance with
the terms of an Approved Credit Support Document pursuant to the provisions of
Part 5(10)(I) hereof, Barclays will deliver Eligible Collateral to Counterparty
in accordance with the terms of an Approved Credit Support Document.  Concurrently with such delivery of Eligible
Collateral, Barclays shall cause its outside counsel to deliver to Counterparty
an opinion as to the enforceability of Counterparty’s security interest in such
Eligible Collateral in all relevant jurisdictions, if necessary to satisfy the
Rating Agency Condition. 
Notwithstanding Barclays’ posting of Eligible Collateral in accordance
with the terms of the Approved Credit Support Document, Barclays shall use best
efforts to either transfer its rights and obligations to an acceptable third
party or to provide a Third Party Credit Support Document.  Notwithstanding the foregoing, Barclays’
obligations under this Part 5(10)(II) to find a transferee or provide a Third
Party Credit Support Document and to post Eligible Collateral under the
Approved Credit Support Document shall remain in effect only for so long as a
Ratings Event II is continuing with respect to Barclays.

 

The failure by Barclays
to comply with the provisions hereof shall constitute an Additional Termination
Event, with Barclays as the sole Affected Party and all Transactions then
outstanding between the parties as Affected Transactions.

 

As used herein:

 

“Approved Credit Support
Document” means a security agreement in the form of the 1994 ISDA Credit
Support Annex (ISDA Agreements Subject to New York Law Only), as modified by
the Paragraph 13 thereto, which Paragraph 13 will be in the form of Annex A to
this Agreement;

 

“Indenture” means the
Master Indenture dated as of August 1, 2001, between World Financial
Network Credit Card Master Note Trust, as Issuer, and BNY Midwest Trust
Company, as Indenture Trustee, as supplemented by the Series 2004-C Indenture
Supplement dated as of September 22, 2004, between World Financial Network
Credit

 

 

Card Master Note Trust,
as the Issuer, and BNY Midwest Trust Company, as the Indenture Trustee (the
“Indenture Supplement”), in each case, as amended, modified, supplemented,
restated or replaced from time to time.

 

“Moody’s” means Moody’s
Investors Service, Inc. or any successor thereto;

 

“Rating Agencies” means
S&P and Moody’s;

 

“Rating Agency Condition”
has the meaning specified in the Indenture;

 

“Ratings Event I” shall
occur with respect to Barclays (to the extent that Barclays’ relevant
obligations are rated by Moody’s) if Barclays’ long-term senior unsecured debt
rating by Moody’s is lower than A1 or is A1 on negative watch or Barclays’
short-term senior unsecured debt rating by Moody’s is lower than P-1 or is P-1
on negative watch;

 

“Ratings Event II” shall
occur with respect to Barclays (to the extent that Barclays’ relevant
obligations are rated by S&P and/or Moody’s) if (a) Barclays’ short-term
senior unsecured debt rating by S&P is lower than A-1 or (b) Barclays’
long-term senior unsecured debt rating by Moody’s is A3 or lower or Barclays’
short-term senior unsecured debt rating by Moody’s is P-2 or lower;

 

“S&P” means by
Standard & Poor’s Ratings Service or any successor thereto; and

 

“Third Party Credit
Support Document” means any agreement or instrument (including any guarantee,
insurance policy, security agreement or pledge agreement) whose terms provide
for the guarantee of Barclays’ obligations under this Agreement by a third
party.

 

(11)                            Additional Representations.  Section 3 is hereby amended by adding
at the end thereof the following paragraphs:

 

                                                “(g)  It is an “eligible contract participant”
under, and as defined in, Section 1a(12) of the Commodity Exchange Act, as
amended.

 

(h) Each party will be
deemed to represent to the other party on the date on which it enters into a
Transaction that (absent a written agreement between the parties that expressly
imposes affirmative obligations to the contrary for that Transaction):

 

(i)                                     Non-Reliance.  It is acting for its own account, and it has
made its own independent decisions to enter into that Transaction and as to
whether that Transaction is appropriate or proper for it based upon its own
judgment and upon advice from such advisers as it has deemed necessary.  It is not relying on any communication
(written or oral) of the other party as investment advice or as a
recommendation to enter into that Transaction; it being understood that
information and explanations related to the terms and conditions of a
Transaction shall not be considered investment advice or a recommendation to
enter into that Transaction.  No
communication (written or oral) received from the other party shall be deemed
to be an assurance or guarantee as to the expected results of that Transaction.

 

(ii)                                  Assessment
and Understanding.  It is
capable of assessing the merits of and understanding (on its own behalf or
through independent professional advice), and understands and accepts, the
terms, conditions and risks of that Transaction.  It is also capable of assuming, and assumes, the risks of that
Transaction.

 

 

(iii)                               Status of
Parties.  The other party is
not acting as a fiduciary for or an adviser to it in respect of that
Transaction.”

 

(12)                            Amendment to Section 7 of the
Agreement. 
Section 7 of the Agreement is hereby amended by:

 

(i) adding the words “and
the confirmation of the Rating Agencies” immediately following the word “party”
in the third line thereof; and

 

(ii) adding the following
sentence immediately following the final sentence thereof:

 

“In addition, no transfer
shall be effective unless it satisfies the Rating Agency Condition.”.

 

(13)                            Events of Default.  Section 5(a)(i) of the Agreement is
amended by substituting the following therefor:  “Failure by the party to make, when due, any payment under this
Agreement or delivery under Section 2(a)(i) or 2(e) required to be made by
it if such failure is not remedied on or before the fifth Local Business Day
after notice of such failure is given to the party.”

 

(14)                            Owner Trustee.  It is expressly understood and agreed by the
parties hereto that (a) this Agreement is executed and delivered by Chase
Manhattan Bank USA, National Association, not individually or personally but
solely as trustee of the Counterparty in the exercise of the powers and
authority conferred and vested in it under the Amended and Restated Trust
Agreement (as defined in the Indenture), (b) each of the representations,
undertakings and agreements herein made on the part of the Counterparty are
made and intended not as personal representations, undertakings and agreements
by Chase Manhattan Bank USA, National Association, but are made and intended
for the purpose of binding only the Counterparty, and (c) under no
circumstances shall Chase Manhattan Bank USA, National Association be
personally liable for the payment of any indebtedness or expenses of the
Counterparty or be liable for the breach or failure of any obligation,
representations, warranty or covenant made or undertaken by the Counterparty
under this Agreement.

 

(15)                            Amendment to Section 9(b) of
the Agreement. 
Section 9(b) of the Agreement is amended by adding the following
sentence immediately following the end of the first sentence thereof:

 

“In addition, no
amendment modification or waiver in respect of this Agreement will be effective
unless it satisfied the Rating Agency Condition.”

 

(16)                            Amendment to Section 6(e) of
the Agreement. 
Section 6(e) of the Agreement is amended by deleting the last
sentence of the introductory paragraph thereof.

 

(17)                            The
parties agree that there will be no Set-off with respect to this Agreement.

 

 

Please confirm your
agreement to the terms of the foregoing Schedule by signing below.

 

	
   

  	
  BARCLAYS BANK PLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Justin Wray

  
	
   

  	
   

  	
   Name: Justin
  Wray

  
	
   

  	
   

  	
   Title:  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WORLD FINANCIAL NETWORK
  CREDIT CARD MASTER NOTE TRUST

  
	
   

  	
  By: Chase Manhattan
  Bank USA, National Association, not in its individual capacity, but solely as
  Owner Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John J. Cashin

  
	
   

  	
   

  	
  Name: John J. Cashin

  
	
   

  	
   

  	
  Title: Vice President

  

 

2004-C

CLASS M SWAP

 

 

ANNEX A

 

PARAGRAPH 13 TO

CREDIT SUPPORT ANNEX

 

to the
Schedule to the

Master Agreement

 

dated as of
September 22, 2004

 

between

 

	
  Barclays Bank PLC

  (“Barclays”)

  	
   

  	
  and

  	
   

  	
  WORLD FINANCIAL NETWORK

  CREDIT CARD MASTER NOTE TRUST

  (“Counterparty”)

  

 

Paragraph 13. Elections
and Variables

 

(a)                                  Security
Interest for “Obligations”.  The term
“Obligations” as used in this Annex includes no additional obligations with
respect to either party.

 

(b)                                 Credit
Support Obligations.

 

(i)                                     Delivery
Amount, Return Amount and Credit Support Amount.

 

(A)                              “Delivery
Amount” has the meaning specified in Paragraph 3(a), except that the words
“upon a demand made by the Secured Party” shall be deleted and the word “that”
on the second line of Paragraph 3(a) shall be replaced with the word “a”.

 

(B)                                “Return
Amount” has the meaning specified in Paragraph 3(b).

 

(C)                                “Credit
Support Amount” shall not have the meaning specified in Paragraph 3(b) and,
instead, will have the following meaning:

 

“Credit Support Amount”
means, for any Valuation Date, (i) the Secured Party’s Modified Exposure for
that Valuation Date minus (ii) the Pledgor’s Threshold; provided, however,
that the Credit Support Amount will be deemed to be zero whenever the
calculation of Credit Support Amount yields a number less than zero.

 

(ii)                                  Eligible
Collateral.  The following items will
qualify as “Eligible Collateral”:

 

 

	
   

  	
   

  	
   

  	
   

  	
  Barclays

  	
   

  	
  “Valuation

  Percentage”

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (A)

  	
   

  	
  USD Cash

  	
   

  	
  X

  	
   

  	
  100%

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (B)

  	
   

  	
  Negotiable debt
  obligations issued by the U.S. Treasury Department having a remaining
  maturity of one year or less from the Valuation Date

  	
   

  	
  X

  	
   

  	
  98.9%

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (C)

  	
   

  	
  Negotiable debt
  obligations issued by the U.S. Treasury Department having a remaining
  maturity of more than one year but less than ten years from the Valuation
  Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (D)

  	
   

  	
  Negotiable debt
  obligations issued by the U.S. Treasury Department having a remaining
  maturity of ten years or more from the Valuation Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (E)

  	
   

  	
  Agency Securities
  having a remaining maturity of one year or less from the Valuation Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (F)

  	
   

  	
  Agency Securities
  having a remaining maturity of more than one year but less than ten years
  from the Valuation Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (G)

  	
   

  	
  Agency Securities
  having a remaining maturity of ten years or more from the Valuation Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  (H)

  	
   

  	
  USD denominated
  Commercial Paper rated A1/P1 by S&P and Moody’s respectively, that (a)
  settles within DTC, (b) is not issued by Barclays or any of its Affiliates
  and (c) has a remaining maturity of 30 days or less from the Valuation Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  

 

 

For purposes of the
foregoing:

 

(a) “Agency Securities”
means negotiable debt obligations which are fully guaranteed as to both
principal and interest by the Federal National Mortgage Association, the
Government National Mortgage Association or the Federal Home Loan Mortgage
Corporation, but excluding (i) interest only and principal only securities and
(ii) Collateralized Mortgage Obligations, Real Estate Mortgage Investment
Conduits and similar derivative securities.

 

(b) “DTC” shall mean The
Depository Trust & Clearing Corporation, or its successor.

 

(c) “Moody’s” shall mean
Moody’s Investors Service, Inc., or its successor.

 

(d) “S&P” shall mean
Standard & Poor’s Ratings Group, or its successor.

 

(e)
Eligible Collateral of the type described in Paragraph 13(b)(ii)(H) may never
constitute more than 20% of the total Value of Posted Collateral.

 

(f)
With respect to Posted Collateral consisting of Eligible Collateral of the type
described in Paragraph 13(b)(ii)(H), the aggregate Value of such Posted
Collateral issued by the same issuer may never be greater than 33% of the
aggregate Value of all Posted Collateral consisting of Eligible Collateral of
the type described in Paragraph 13(b)(ii)(H).

 

(iii)                               Other
Eligible Support.  There shall be no
“Other Eligible Support” for purposes of this Annex, unless (A) agreed in
writing between the parties and (B) upon the prior written consent of Moody’s
and S&P.

 

(iv)                              Thresholds.

 

(A)                              “Independent
Amount” means zero.

 

(B)                                “Threshold”
shall not apply with respect to the Counterparty and, with respect to Barclays,
shall mean the amounts determined on the basis of the lower of the Credit
Ratings set forth in the following table, provided, however, that
if (i) Barclays has no Credit Rating, or (ii) an Event of Default has occurred
and is continuing with respect to Barclays, Barclays’ Threshold shall be
U.S.$0:

 

 

	
  CREDIT RATING

  (S&P /Moody’s)

  	
   

  	
  THRESHOLD

  Barclays

  
	
   

  	
   

  	
   

  
	
  S&P: A-1
  or above; and

  	
   

  	
  Infinity

  
	
   

  	
   

  	
   

  
	
  Moody’s
  (long-term senior unsecured debt of Barclays): A1 or above; and

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Moody’s (short-term
  senior unsecured debt of Barclays): P-1 or above.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  S&P: Below A-1; or

  	
   

  	
  US$0

  
	
   

  	
   

  	
   

  
	
  Moody’s (long-term
  senior unsecured debt of Barclays): Below A1 or A1 on negative watch; or

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Moody’s (short-term
  senior unsecured debt of Barclays): Below P-1 or P-1 on negative watch.

  	
   

  	
   

  

 

As used herein:

 

“Credit Rating” means,
with respect to (a) S&P, the rating assigned by S&P to the short-term
senior unsecured debt of Barclays, and (b) Moody’s, the rating assigned by
Moody’s to the long-term senior unsecured debt of Barclays or to the short-term
senior unsecured debt of Barclays, as applicable.

 

(C)                                “Minimum
Transfer Amount”, with respect to a party on any Valuation Date, means U.S.
$100,000.

 

Rounding.  The Delivery Amount and the Return Amount
will be rounded up and down to the nearest integral multiple of $10,000,
respectively.

 

(c)                                  Valuation
and Timing.

 

(i)                                     “Valuation
Agent” means Barclays, unless an Event of Default with respect to Barclays is
continuing, in which case “Valuation Agent” shall mean the Counterparty or a
financial institution selected by the Counterparty in its reasonable
discretion.

 

(ii)                                  “Valuation
Date” means weekly on the last Local Business Day of each week or more
frequently if agreed in writing by the parties.

 

(iii)                               “Valuation
Time” means the close of business in the city of the Valuation Agent on the
Valuation Date or date of calculation, as applicable.

 

(iv)                              “Notification
Time” means 12:00 p.m., New York time, on a Local Business Day.

 

(d)                                 Conditions
Precedent.  With respect to
Barclays, any Additional Termination Event (if Barclays is the Affected Party
with respect to such Termination Event) will be a “Specified Condition”.

 

(e)                                  Substitution.

 

 

(i)                                     “Substitution
Date” has the meaning specified in Paragraph 4(d)(ii).

 

(ii)                                  Consent.  Inapplicable.

 

(f)                                    Dispute
Resolution.

 

(i)                                     “Resolution
Time” means 1:00 p.m., New York time, on the Local Business Day following the
date on which the notice is given that gives rise to a dispute under Paragraph
5.

 

(ii)                                  Value.   For the purposes of Paragraphs 5(i)(C) and
5(ii), the Value of Posted Credit Support other than Cash will be calculated as
follows:

 

(A)
with respect to any Eligible Collateral except Cash, the sum of (I) (x) the
mean of the high bid and low asked prices quoted on such date by any principal
market maker for such Eligible Collateral chosen by the Disputing Party, or (y)
if no quotations are available from a principal market maker for such date, the
mean of such high bid and low asked prices as of the first day prior to such
date on which such quotations were available, plus (II) the accrued interest on
such Eligible Collateral (except to the extent Transferred to a party pursuant
to any applicable provision of this Agreement or included in the applicable
price referred to in (I) of this clause (A)) as of such date; multiplied by the
applicable Valuation Percentage.

 

(iii)                               Alternative.  The provisions of Paragraph 5 will apply.

 

(g)                                 Holding
and Using Posted Collateral.

 

(i)                                     Eligibility
to Hold Posted Collateral; Custodians. 
Counterparty and its Custodian will be entitled to hold Posted
Collateral pursuant to Paragraph 6(b); provided that the following conditions
applicable to it are satisfied:

 

(1)                                  Counterparty
is not a Defaulting Party and

 

(2)                                  Posted
Collateral may be held only in the following jurisdictions:

New
York State.

 

Initially, the Custodian
for Counterparty is: Chase Manhattan Bank USA, National Association.

 

(ii)                                  Use
of Posted Collateral.  The provisions of
Paragraph 6(c)(i) will not apply to Counterparty but the provisions of
Paragraph 6(c)(ii) will apply to the Counterparty; provided, however, that the
Counterparty shall invest, or cause to be invested, Posted Collateral in the
form of Cash in such Eligible Investments (as defined in the Indenture) as
designated by Barclays.  The
Counterparty is authorized to liquidate any Posted Credit Support pursuant to
written instructions from Barclays.

 

(iii)                               Holding
Collateral.  The Secured Party shall
cause any Custodian appointed hereunder to open and maintain a segregated
account and to hold, record and identify all the Posted Collateral in such
segregated account and, subject to Paragraphs 6(c) and 8(a), such Posted
Collateral shall at all times be and remain

 

 

the property of the
Pledgor and shall at not time constitute the property of, or be commingled with
the property of, the Secured Party or the Custodian.

 

(h)                                 Distributions
and Interest Amount.

 

(i)                                     Interest
Rate.  Not Applicable

 

(ii)                                  Transfer
of Interest Amount.  The Transfer of the
Interest Amount will be made monthly on the second Local Business Day of each
calendar month.

 

(iii)                               Alternative
to Interest Amount.  The provisions of
Paragraph 6(d)(ii) will not apply and, instead, the Interest Amount payable by
the Counterparty specified in subparagraph (h)(ii) will be the amount of actual
cash earnings on Posted Collateral in the form of Cash during the relevant
Interest Period.

 

(i)                                     Additional
Representation(s).  Not Applicable.

 

(j)                                     Other
Eligible Support and Other Posted Support.

 

(i)                                     “Value”
with respect to Other Eligible Support and Other Posted Support means: Not
Applicable.

 

(ii)                                  “Transfer”
with respect to Other Eligible Support and Other Posted Support means: Not
Applicable

 

(k)                                  Demands
and Notices.

 

All demands,
specifications and notices under this Annex will be made pursuant to the
Notices Section of this Agreement, unless otherwise specified here: N/A

 

Counterparty:

 

 

 

Barclays:

 

	
  For
  cash:

  	
  For
  Treasury Securities:

  
	
   

  	
   

  
	
  Barclays
  Bank PLC, NY

  	
  Bank
  of NYC/BBPLCLDN

  
	
  ABA
  #026-002-574

  	
  ABA

  
	
  F/O:
  Barclays Swaps & Options

  	
   

  
	
  Group NY

  	
   

  
	
  A/C
  #: 050019228

  	
   

  
	
  Ref:
  Collateral

  	
   

  

 

(l)                                     Addresses
for Transfers.

 

Counterparty: as set
forth in notices to Barclays from time to time

 

Barclays:

 

 

(m)                               Other
Provisions:

 

(i)                                     Modification
to Paragraph 1: The following subparagraph (b) is substituted for
subparagraph (b) of this Annex:

 

(b) Secured Party and Pledgor.  All references in this Annex to the “Secured
Party” will be to Counterparty and all corresponding references to the
“Pledgor” will be to Barclays.

 

(ii)                                  Modification
to Paragraph 2:  The following
Paragraph 2 is substituted for Paragraph 2 of this Annex:

 

Paragraph 2.  Security Interest.  The Pledgor hereby pledges to the Secured
Party, as security for its Obligations, and grants to the Secured Party a first
priority continuing security interest in and lien on against all Posted
Collateral Transferred to or received by the Secured Party hereunder.  Upon the Transfer by the Secured Party to
the Pledgor of Posted Collateral, the security interest and lien granted hereunder
on that Posted Collateral will be released immediately and, to the extent
possible, without any further action by either party.

 

(iii)                               Modification
to Paragraph 8(a):  Paragraph 8(a)
is modified by deleting the text of clause (iii) thereof and replacing such
text with the word “Reserved”.

 

(iv)                              Modification
to Paragraph 8(b)(iv):  Paragraph
8(b)(iv) is modified and restated in its entirety to read as follows:

 

“(iv) to the
extent that Posted Collateral or the Interest Amount is not so Transferred
pursuant to (iii) above, the Pledgor may withhold payment of any remaining
amounts payable by the Pledgor with respect to any Obligations, up to the Value
of any remaining Posted Collateral held by the Secured Party, until that Posted
Collateral is Transferred to the Pledgor.”

 

(v)                                 Modification
to Paragraph 8(c):  Paragraph 8(c) is
modified and restated in its entirety to read as follows:

 

“(c)                            Deficiencies and Excess Proceeds.  The Secured Party will Transfer to the
Pledgor any proceeds and Posted Credit Support remaining after liquidation
and/or application under Paragraphs 8(a) and 8(b) after satisfaction in full of
all amounts payable by the Pledgor with respect to any Obligations; the Pledgor
in all events will remain liable for any amounts remaining unpaid after any
liquidation and/or application under Paragraphs 8(a) and 8(b).”

 

(vi)                              Modification
to Paragraph 9:  The following first
clause of Paragraph 9 is substituted for the first clause of Paragraph 9 of
this Annex:

 

Paragraph 9.   Representations.  The Pledgor represents to the Secured Party
(which representations will be deemed to be repeated as of each date on which
it Transfers Eligible Collateral) that:

 

 

(vii)                           Modifications
to Paragraph 12:  The following
definitions of “Pledgor” and “Secured Party” are substituted for the
definitions of those terms contained in Paragraph 12 of this Annex:

 

“Pledgor” means Barclays,
when that party (i) is required to Transfer Eligible Credit Support under
Paragraph 3(a) or (ii) has Transferred Eligible Credit Support under Paragraph
3(a).

 

“Secured Party” means
Counterparty, when that party (i) is entitled to receive Eligible Credit
Support under Paragraph 3(a) or (ii) holds or is deemed to hold Posted Credit
Support.

 

(viii)                        Addition
to Paragraph 12:  The following
definitions of “Modified Exposure” shall be added immediately after the
definition of the term “Minimum Transfer Amount” and immediately prior to the
definition of the term “Notification Time” in Paragraph 12 of this Annex:

 

“Modified Exposure”
means, for any Valuation Date, an amount equal to the greater of (i) the sum of
the Secured Party’s Exposure for that Valuation Date and the Volatility Buffer,
and (ii) the amount of the next scheduled payment that is required to be made
by Barclays pursuant to the Transaction. 
As used herein:

 

“Volatility Buffer”
means, with respect to the Transaction, an amount equal to the product of (a)
the Factor applicable to the Transaction and (b) the Notional Amount of the
Transaction.

 

“Factor” means, with
respect to the Transaction, a percentage dependent on Barclays’ Counterparty
Rating and the original maturity of the Transaction and determined by the
Valuation Agent by reference to the following table:

 

	
  Counterparty Rating

  	
   

  	
  Maturities up to 5

  years (%)

  	
   

  	
  Maturities up to 10

  years (%)

  	
   

  	
  Maturities up to 30

  years (%)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A-2/P-2

  	
   

  	
  3.25

  	
   

  	
  4.00

  	
   

  	
  4.75

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  A-3/P-3

  	
   

  	
  4.00

  	
   

  	
  5.00

  	
   

  	
  6.25

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BB+/Ba1 or lower

  	
   

  	
  4.50

  	
   

  	
  6.75

  	
   

  	
  7.50

  	
   

  

 

 

(ix)                                   Modification
to Paragraph 12:  Clause “(B)” of the
definition of “Value” will be substituted to read in its entirety as follows:

 

“(B) a security, the bid
price obtained by the Valuation Agent from one of the Pricing Sources
multiplied by the applicable Valuation Percentage, if any;”

 

(x)                                      Addition
to Paragraph 12:  The following definition
of “Pricing Sources” shall be added immediately after the definition of the
term “Posted Credit Support” and immediately prior to the definition of the
term “Recalculation Date” in Paragraph 12 of this Annex:

 

 

“Pricing Sources” means
the sources of financial information commonly known as Bloomberg, Bridge
Information Services, Data Resources Inc., Interactive Data Services,
International Securities Market Association, Merrill Lynch Securities Pricing
Service, Muller Data Corporation, Reuters, Wood Gundy, Trepp Pricing, JJ Kenny,
S&P and Telerate.

 

(xi)                                Expenses.  Notwithstanding Paragraph 10, the Pledgor
will be responsible for, and will reimburse the Secured Party for, all transfer
and other taxes and other costs involved in the transfer of Eligible
Collateral.

 

 

	
  Accepted and Agreed:

  	
   

  
	
   

  	
   

  
	
  BARCLAYS BANK PLC

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:
  Chase Manhattan Bank USA, National

  Association, not in its individual capacity, but

  solely as Owner Trustee

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Title:EXHIBIT 4.9

 

	
   

  	
   

  	
  2004-C

  
	
  (Multicurrency-Cross Border)

  	
   

  	
  CLASS B SWAP

  

 

ISDA®

 

International Swap
Dealers Association, Inc.

 

MASTER AGREEMENT

 

dated as of
September 22, 2004

 

	
  Barclays
  Bank PLC  

  (“Party
  A”)

  	
   

  	
  and

  	
   

  	
  World
  Financial Network Credit 

  Card  

  Master Note Trust  

  (“Party
  B”)

  

 

have entered and/or
anticipate entering into one or more transactions (each a “Transaction”) that
are or will be governed by this Master Agreement, which includes the
schedule (the “Schedule”), and the documents and other confirming evidence
(each a “Confirmation”) exchanged between the parties confirming those
Transactions.

 

Accordingly, the parties
agree as follows:—

 

1.             Interpretation

 

(a)           Definitions. The terms defined in
Section 14 and in the Schedule will have the meanings therein
specified for the purpose of this Master Agreement.

 

(b)           Inconsistency. In the event of any
inconsistency between the provisions of the Schedule and the other
provisions of this Master Agreement, the Schedule will prevail.  In the event of any inconsistency between
the provisions of any Confirmation and this Master Agreement (including the
Schedule), such Confirmation will prevail for the purpose of the relevant
Transaction.

 

(c)           Single Agreement. All Transactions are
entered into in reliance on the fact that this Master Agreement and all
Confirmations form a single agreement between the parties (collectively
referred to as this “Agreement”), and the parties would not otherwise enter
into any Transactions.

 

2.             Obligations

 

(a)           General Conditions.

 

(i)            Each party will make
each payment or delivery specified in each Confirmation to be made by it,
subject to the other provisions of this Agreement.

 

(ii)           Payments under this
Agreement will be made on the due date for value on that date in the place of
the account specified in the relevant Confirmation or otherwise pursuant to
this Agreement, in freely transferable funds and in the manner customary for
payments in the required currency. Where settlement is by delivery (that is,
other than by payment), such delivery will be 

 

 

made for receipt on the
due date in the manner customary for the relevant obligation unless otherwise
specified in the relevant Confirmation or elsewhere in this Agreement.

 

(iii)          Each obligation of each
party under Section 2(a)(i) is subject to (1) the condition precedent that
no Event of Default or Potential Event of Default with respect to the other
party has occurred and is continuing, (2) the condition precedent that no Early
Termination Date in respect of the relevant Transaction has occurred or been
effectively designated and (3) each other applicable condition precedent
specified in this Agreement.

 

(b)           Change of Account. 
Either party may change its account for receiving a payment
or delivery by giving notice to the other party at least five Local Business
Days prior to the scheduled date for the payment or delivery to which such
change applies unless such other party gives timely notice of a reasonable
objection to such change.

 

(c)           Netting. 
If on any date amounts would otherwise be payable:—

 

(i)            in the same currency;
and

 

(ii)           in respect of the same
Transaction,

 

by each party to the
other, then, on such date, each party’s obligation to make payment of any such
amount will be automatically satisfied and discharged and, if the aggregate
amount that would otherwise have been payable by one party exceeds the
aggregate amount that would otherwise have been payable by the other party,
replaced by an obligation upon the party by whom the larger aggregate amount
would have been payable to pay to the other party the excess of the larger
aggregate amount over the smaller aggregate amount.

 

The parties may elect in
respect of two or more Transactions that a net amount will be determined in
respect of all amounts payable on the same date in the same currency in respect
of such Transactions, regardless of whether such amounts are payable in respect
of the same Transaction.  The election
may be made in the Schedule or a Confirmation by specifying that
subparagraph (ii) above will not apply to the Transactions identified as being
subject to the election, together with the starting date (in which case
subparagraph (ii) above will not, or will cease to, apply to such Transactions
from such date).  This election may be
made separately for different groups of Transactions and will apply separately
to each pairing of Offices through which the parties make and receive payments
or deliveries.

 

(d)           Deduction or
Withholding for Tax.

 

(i)            Gross-Up. 
All payments under this Agreement will be made without any deduction or
withholding for or on account of any Tax unless such deduction or withholding
is required by any applicable law, as modified by the practice of any relevant
governmental revenue authority, then in effect.  If a party is so required to deduct or withhold, then that party
(“X”) will:—

 

(1)           promptly notify the
other party (“Y”) of such requirement;

 

(2)           pay to the relevant
authorities the full amount required to be deducted or withheld (including the
full amount required to be deducted or withheld from any additional amount paid
by X to Y under this Section 2(d)) promptly upon the earlier of
determining that such deduction or withholding is required or receiving notice
that such amount has been assessed against Y;

 

2

 

(3)           promptly forward to Y
an official receipt (or a certified copy), or other documentation reasonably
acceptable to Y, evidencing such payment to such authorities; and

 

(4)           if such Tax is an
Indemnifiable Tax, pay to Y, in addition to the payment to which Y is otherwise
entitled under this Agreement, such additional amount as is necessary to ensure
that the net amount actually received by Y (free and clear of Indemnifiable
Taxes, whether assessed against X or Y) will equal the full amount Y would have
received had no such deduction or withholding been required.  However, X will not be required to pay any
additional amount to Y to the extent that it would not be required to be paid
but for:—

 

(A)  the failure by Y to comply with or perform
any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d); or

 

(B)  the failure of a representation made by Y
pursuant to Section 3(f) to be accurate and true unless such failure would
not have occurred but for (I) any action taken by a taxing authority, or
brought in a court of competent jurisdiction, on or after the date on which a
Transaction is entered into (regardless of whether such action is taken or
brought with respect to a party to this Agreement) or (II) a Change in Tax Law.

 

(ii)           Liability. 
If:—

 

(1)           X is required by any
applicable law, as modified by the practice of any relevant governmental
revenue authority, to make any deduction or withholding in respect of which X
would not be required to pay an additional amount to Y under Section 2(d)(i)(4);

 

(2)           X does not so deduct or
withhold; and

 

(3)           a liability resulting
from such Tax is assessed directly against X,

 

then, except to the
extent Y has satisfied or then satisfies the liability resulting from such Tax,
Y will promptly pay to X the amount of such liability (including any related
liability for interest, but including any related liability for penalties only
if Y has failed to comply with or perform any agreement contained in
Section 4(a)(i), 4(a)(iii) or 4(d)).

 

(e)           Default Interest; Other Amounts.  Prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant
Transaction, a party that defaults in the performance of any payment obligation
will, to the extent permitted by law and subject to Section 6(c), be
required to pay interest (before as well as after judgment) on the overdue
amount to the other party on demand in the same currency as such overdue
amount, for the period from (and including) the original due date for payment
to (but excluding) the date of actual payment, at the Default Rate.  Such interest will be calculated on the
basis of daily compounding and the actual number of days elapsed.  If, prior to the occurrence or effective
designation of an Early Termination Date in respect of the relevant
Transaction, a party defaults in the performance of any obligation required to
be settled by delivery, it will compensate the other party on demand if and to
the extent provided for in the relevant Confirmation or elsewhere in this Agreement.

 

3

 

3.             Representations

 

Each party represents to
the other party (which representations will be deemed to be repeated by each
party on each date on which a Transaction is entered into and, in the case of
the representations in Section 3(f), at all times until the termination of
this Agreement) that:—

 

(a)           Basic Representations.

 

(i)            Status. 
It is duly organised and validly existing under the laws of the
jurisdiction of its organisation or incorporation and, if relevant under such
laws, in good standing;

 

(ii)           Powers. 
It has the power to execute this Agreement and any other documentation
relating to this Agreement to which it is a party, to deliver this Agreement
and any other documentation relating to this Agreement that it is required by
this Agreement to deliver and to perform its obligations under this Agreement
and any obligations it has under any Credit Support Document to which it is a
party and has taken all necessary action to authorise such execution, delivery
and performance;

 

(iii)          No Violation or Conflict.  Such execution, delivery and performance do
not violate or conflict with any law applicable to it, any provision of its
constitutional documents, any order or judgment of any court or other agency of
government applicable to it or any of its assets or any contractual restriction
binding on or affecting it or any of its assets;

 

(iv)          Consents. 
All governmental and other consents that are required to have been
obtained by it with respect to this Agreement or any Credit Support Document to
which it is a party have been obtained and are in full force and effect and all
conditions of any such consents have been complied with; and

 

(v)           Obligations Binding.  Its obligations under this Agreement and any
Credit Support Document to which it is a party constitute its legal, valid and
binding obligations, enforceable in accordance with their respective terms
(subject to applicable bankruptcy, reorganisation, insolvency, moratorium or
similar laws affecting creditors’ rights generally and subject, as to
enforceability, to equitable principles of general application (regardless of
whether enforcement is sought in a proceeding in equity or at law)).

 

(b)           Absence of Certain Events.  No Event of Default or Potential Event of
Default or, to its knowledge, Termination Event with respect to it has occurred
and is continuing and no such event or circumstance would occur as a result of
its entering into or performing its obligations under this Agreement or any Credit
Support Document to which it is a party.

 

(c)           Absence of Litigation.  There is not pending or, to its knowledge,
threatened against it or any of its Affiliates any action, suit or proceeding
at law or in equity or before any court, tribunal, governmental body, agency or
official or any arbitrator that is likely to affect the legality, validity or
enforceability against it of this Agreement or any Credit Support Document to
which it is a party or its ability to perform its obligations under this Agreement
or such Credit Support Document.

 

(d)           Accuracy of Specified Information.  All applicable information that is furnished
in writing by or on behalf of it to the other party and is identified for the
purpose of this Section 3(d) in the Schedule is, as of the date of
the information, true, accurate and complete in every material respect.

 

4

 

(e)           Payer Tax Representation.  Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(e) is
accurate and true.

 

(f)            Payee Tax Representations.  Each representation specified in the
Schedule as being made by it for the purpose of this Section 3(f) is
accurate and true.

 

4.             Agreements

 

Each party agrees with
the other that, so long as either party has or may have any obligation under
this Agreement or under any Credit Support Document to which it is a party:—

 

(a)           Furnish Specified Information.  It will deliver to the other party or, in
certain cases under subparagraph (iii) below, to such government or taxing
authority as the other party reasonably directs:

 

(i)            any forms, documents
or certificates relating to taxation specified in the Schedule or any
Confirmation;

 

(ii)           any other documents
specified in the Schedule or any Confirmation; and

 

(iii)          upon reasonable demand
by such other party, any form or document that may be required or reasonably
requested in writing in order to allow such other party or its Credit Support
Provider to make a payment under this Agreement or any applicable Credit
Support Document without any deduction or withholding for or on account of any
Tax or with such deduction or withholding at a reduced rate (so long as the
completion, execution or submission of such form or document would not
materially prejudice the legal or commercial position of the party in receipt
of such demand), with any such form or document to be accurate and completed in
a manner reasonably satisfactory to such other party and to be executed and to
be delivered with any reasonably required certification,

 

in each case by the date
specified in the Schedule or such Confirmation or, if none is specified,
as soon as reasonably practicable.

 

(b)           Maintain Authorisations.  It will use all reasonable efforts to
maintain in full force and effect all consents of any governmental or other
authority that are required to be obtained by it with respect to this Agreement
or any Credit Support Document to which it is a party and will use all
reasonable efforts to obtain any that may become necessary in the future.

 

(c)           Comply with Laws.  It will comply in all material respects with all applicable laws
and orders to which it may be subject if failure so to comply would materially
impair its ability to perform its obligations under this Agreement or any Credit
Support Document to which it is a party.

 

(d)           Tax Agreement.  It will give notice of any failure of a representation made by it
under Section 3(f) to be accurate and true promptly upon learning of such
failure.

 

(e)           Payment of Stamp Tax.  Subject to Section 11, it will pay any
Stamp Tax levied or imposed upon it or in respect of its execution or
performance of this Agreement by a jurisdiction in which it is incorporated,
organised, managed and controlled, or considered to have its seat, or in which
a branch or office through which it is acting for the purpose of this Agreement
is located (“Stamp Tax Jurisdiction”) and will indemnify the other party
against any Stamp Tax levied or imposed upon the other party or in respect of
the other party’s execution or performance of this Agreement by any such Stamp
Tax Jurisdiction which is not also a Stamp Tax Jurisdiction with respect to the
other party.

 

5

 

5.             Events of Default
and Termination Events

 

(a)           Events of Default.  The occurrence at any time with respect to a party or, if
applicable, any Credit Support Provider of such party or any Specified Entity
of such party of any of the following events constitutes an event of default
(an “Event of Default”) with respect to such party:—

 

(i)            Failure to Pay or Deliver.  Failure by the party to make, when due, any
payment under this Agreement or delivery under Section 2(a)(i) or 2(e)
required to be made by it if such failure is not remedied on or before the
third Local Business Day after notice of such failure is given to the party;

 

(ii)           Breach of Agreement.  Failure by the party to comply with or
perform any agreement or obligation (other than an obligation to make any
payment under this Agreement or delivery under Section 2(a)(i) or 2(e) or
to give notice of a Termination Event or any agreement or obligation under
Section 4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by
the party in accordance with this Agreement if such failure is not remedied on
or before the thirtieth day after notice of such failure is given to the party;

 

(iii)          Credit Support Default.

 

(1)           Failure by the party or
any Credit Support Provider of such party to comply with or perform any
agreement or obligation to be complied with or performed by it in accordance
with any Credit Support Document if such failure is continuing after any
applicable grace period has elapsed;

 

(2)           the expiration or
termination of such Credit Support Document or the failing or ceasing of such
Credit Support Document to be in full force and effect for the purpose of this
Agreement (in either case other than in accordance with its terms) prior to the
satisfaction of all obligations of such party under each Transaction to which
such Credit Support Document relates without the written consent of the other
party; or

 

(3)           the party or such
Credit Support Provider disaffirms, disclaims, repudiates or rejects, in whole
or in part, or challenges the validity of, such Credit Support Document;

 

(iv)          Misrepresentation.  A representation (other than a representation under
Section 3(e) or (f)) made or repeated or deemed to have been made or
repeated by the party or any Credit Support Provider of such party in this
Agreement or any Credit Support Document proves to have been incorrect or
misleading in any material respect when made or repeated or deemed to have been
made or repeated;

 

(v)           Default under Specified Transaction.  The party, any Credit Support Provider of
such party or any applicable Specified Entity of such party (1) defaults under
a Specified Transaction and, after giving effect to any applicable notice
requirement or grace period, there occurs a liquidation of, an acceleration of
obligations under, or an early termination of, that Specified Transaction, (2)
defaults, after giving effect to any applicable notice requirement or grace
period, in making any payment or delivery due on the last payment, delivery or
exchange date of, or any payment on early termination of, a Specified
Transaction (or such default continues for at least three Local Business Days
if there is no applicable notice requirement or grace period) or (3)
disaffirms, disclaims, repudiates or rejects, in whole or in part, a Specified
Transaction (or such action is taken by any person or entity appointed or
empowered to operate it or act on its behalf);

 

6

 

(vi)          Cross Default.  If “Cross Default” is specified in the Schedule as applying
to the party, the occurrence or existence of (1) a default, event of default or
other similar condition or event (however described) in respect of such party,
any Credit Support Provider of such party or any applicable Specified Entity of
such party under one or more agreements or instruments relating to Specified
Indebtedness of any of them (individually or collectively) in an aggregate
amount of not less than the applicable Threshold Amount (as specified in the
Schedule) which has resulted in such Specified Indebtedness becoming, or
becoming capable at such time of being declared, due and payable under such
agreements or instruments, before it would otherwise have been due and payable
or (2) a default by such party, such Credit Support Provider or such Specified
Entity (individually or collectively) in making one or more payments on the due
date thereof in an aggregate amount of not less than the applicable Threshold
Amount under such agreements or instruments (after giving effect to any
applicable notice requirement or grace period);

 

(vii)         Bankruptcy. 
The party, any Credit Support Provider of such party or any applicable
Specified Entity of such party:—

 

(i) is dissolved (other
than pursuant to a consolidation, amalgamation or merger); (2) becomes
insolvent or is unable to pay its debts or fails or admits in writing its
inability generally to pay its debts as they become due; (3) makes a general
assignment, arrangement or composition with or for the benefit of its
creditors; (4) institutes or has instituted against it a proceeding seeking a
judgment of insolvency or bankruptcy or any other relief under any bankruptcy
or insolvency law or other similar law affecting creditors’ rights, or a
petition is presented for its winding-up or liquidation, and, in the case of
any such proceeding or petition instituted or presented against it, such
proceeding or petition (A) results in a judgment of insolvency or bankruptcy or
the entry of an order for relief or the making of an order for its winding-up
or liquidation or (B) is not dismissed, discharged, stayed or restrained in
each case within 30 days of the institution or presentation thereof; (5) has a
resolution passed for its winding-up, official management or liquidation (other
than pursuant to a consolidation, amalgamation or merger); (6) seeks or becomes
subject to the appointment of an administrator, provisional liquidator,
conservator, receiver, trustee, custodian or other similar official for it or
for all or substantially all its assets; (7) has a secured party take
possession of all or substantially all its assets or has a distress, execution,
attachment, sequestration or other legal process levied, enforced or sued on or
against all or substantially all its assets and such secured party maintains
possession, or any such process is not dismissed, discharged, stayed or
restrained, in each case within 30 days thereafter; (8) causes or is subject to
any event with respect to it which, under the applicable laws of any
jurisdiction, has an analogous effect to any of the events specified in clauses
(1) to (7) (inclusive); or (9) takes any action in furtherance of, or
indicating its consent to, approval of, or acquiescence in, any of the
foregoing acts; or

 

(viii)        Merger Without Assumption.  The party or any Credit Support Provider of
such party consolidates or amalgamates with, or merges with or into, or
transfers all or substantially all its assets to, another entity and, at the
time of such consolidation, amalgamation, merger or transfer:—

 

(1)           the resulting,
surviving or transferee entity fails to assume all the obligations of such
party or such Credit Support Provider under this Agreement or any Credit
Support Document to which it or its predecessor was a party by operation of law
or pursuant to an agreement reasonably satisfactory to the other party to this
Agreement; or

 

7

 

(2)           the benefits of any
Credit Support Document fail to extend (without the consent of the other party)
to the performance by such resulting, surviving or transferee entity of its
obligations under this Agreement.

 

(b)           Termination Events.  The occurrence at any time with respect to a party or, if
applicable, any Credit Support Provider of such party or any Specified Entity
of such party of any event specified below constitutes an Illegality if the event
is specified in (i) below, a Tax Event if the event is specified in (ii) below
or a Tax Event Upon Merger if the event is specified in (iii) below, and, if
specified to be applicable, a Credit Event Upon Merger if the event is
specified pursuant to (iv) below or an Additional Termination Event if the
event is specified pursuant to (v) below:—

 

(i)            Illegality. 
Due to the adoption of, or any change in, any applicable law after the
date on which a Transaction is entered into, or due to the promulgation of, or
any change in, the interpretation by any court, tribunal or regulatory
authority with competent jurisdiction of any applicable law after such date, it
becomes unlawful (other than as a result of a breach by the party of
Section 4(b)) for such party (which will be the Affected Party):—

 

(1)           to perform any absolute
or contingent obligation to make a payment or delivery or to receive a payment
or delivery in respect of such Transaction or to comply with any other material
provision of this Agreement relating to such Transaction; or

 

(2)           to perform, or for any
Credit Support Provider of such party to perform, any contingent or other
obligation which the party (or such Credit Support Provider) has under any
Credit Support Document relating to such Transaction;

 

(ii)           Tax Event. 
Due to (x) any action taken by a taxing authority, or brought in a court
of competent jurisdiction, on or after the date on which a Transaction is
entered into (regardless of whether such action is taken or brought with
respect to a party to this Agreement) or (y) a Change in Tax Law, the party
(which will be the Affected Party) will, or there is a substantial likelihood
that it will, on the next succeeding Scheduled Payment Date (1) be required to
pay to the other party an additional amount in respect of an Indemnifiable Tax
under Section 2(d)(i)(4) (except in respect of interest under
Section 2(e), 6(d)(ii) or 6(e)) or (2) receive a payment from which an
amount is required to be deducted or withheld for or on account of a Tax
(except in respect of interest under Section 2(e), 6(d)(ii) or 6(e)) and
no additional amount is required to be paid in respect of such Tax under
Section 2(d)(i)(4) (other than by reason of Section 2(d)(i)(4)(A) or
(B));

 

(iii)          Tax Event Upon Merger.  The party (the “Burdened Party”) on the next
succeeding Scheduled Payment Date will either (1) be required to pay an
additional amount in respect of an Indemnifiable Tax under
Section 2(d)(i)(4) (except in respect of interest under Section 2(e),
6(d)(ii) or 6(e)) or (2) receive a payment from which an amount has been
deducted or withheld for or on account of any Indemnifiable Tax in respect of
which the other party is not required to pay an additional amount (other than
by reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of
a party consolidating or amalgamating with, or merging with or into, or
transferring all or substantially all its assets to, another entity (which will
be the Affected Party) where such action does not constitute an event described
in Section 5(a)(viii);

 

(iv)          Credit Event Upon Merger.  If “Credit Event Upon Merger” is specified
in the Schedule as applying to the party, such party (“X”), any Credit
Support Provider of X or any applicable Specified Entity of X consolidates or
amalgamates with, or merges with or into, or transfers all or substantially all
its assets to, another entity and such action does not constitute an event
described 

 

8

 

in
Section 5(a)(viii) but the creditworthiness of the resulting, surviving or
transferee entity is materially weaker than that of X, such Credit Support
Provider or such Specified Entity, as the case may be, immediately prior to
such action (and, in such event, X or its successor or transferee, as
appropriate, will be the Affected Party); or

 

(v)           Additional Termination Event.  If any “Additional Termination Event” is
specified in the Schedule or any Confirmation as applying, the occurrence
of such event (and, in such event, the Affected Party or Affected Parties shall
be as specified for such Additional Termination Event in the Schedule or
such Confirmation).

 

(c)           Event of Default and Illegality.  If an event or circumstance which would
otherwise constitute or give rise to an Event of Default also constitutes an
Illegality, it will be treated as an Illegality and will not constitute an
Event of Default.

 

6.             Early Termination

 

(a)           Right to Terminate Following Event of Default.  If at any time an Event of Default with
respect to a party (the “Defaulting Party”) has occurred and is then
continuing, the other party (the “Non-defaulting Party”) may, by not more than
20 days notice to the Defaulting Party specifying the relevant Event of
Default, designate a day not earlier than the day such notice is effective as
an Early Termination Date in respect of all outstanding Transactions.  If, however, “Automatic Early Termination”
is specified in the Schedule as applying to a party, then an Early
Termination Date in respect of all outstanding Transactions will occur
immediately upon the occurrence with respect to such party of an Event of
Default specified in Section 5(a)(vii)(1), (3), (5), (6) or, to the extent
analogous thereto, (8), and as of the time immediately preceding the
institution of the relevant proceeding or the presentation of the relevant
petition upon the occurrence with respect to such party of an Event of Default
specified in Section 5(a)(vii)(4) or, to the extent analogous thereto,
(8).

 

(b)           Right to Terminate
Following Termination Event.

 

(i)            Notice. 
If a Termination Event occurs, an Affected Party will, promptly upon
becoming aware of it, notify the other party, specifying the nature of that
Termination Event and each Affected Transaction and will also give such other
information about that Termination Event as the other party may reasonably
require.

 

(ii)           Transfer to Avoid Termination Event.  If either an Illegality under
Section 5(b)(i)(1) or a Tax Event occurs and there is only one Affected
Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the Affected
Party, the Affected Party will, as a condition to its right to designate an
Early Termination Date under Section 6(b)(iv), use all reasonable efforts
(which will not require such party to incur a loss, excluding immaterial,
incidental expenses) to transfer within 20 days after it gives notice under
Section 6(b)(i) all its rights and obligations under this Agreement in
respect of the Affected Transactions to another of its Offices or Affiliates so
that such Termination Event ceases to exist.

 

If the Affected Party is
not able to make such a transfer it will give notice to the other party to that
effect within such 20 day period, whereupon the other party may effect such a
transfer within 30 days after the notice is given under Section 6(b)(i).

 

Any such transfer by a
party under this Section 6(b)(ii) will be subject to and conditional upon
the prior written consent of the other party, which consent will not be
withheld if such other party’s 

 

9

 

policies in effect at
such time would permit it to enter into transactions with the transferee on the
terms proposed.

 

(iii)          Two Affected Parties.  If an Illegality under
Section 5(b)(i)(1) or a Tax Event occurs and there are two Affected
Parties, each party will use all reasonable efforts to reach agreement within
30 days after notice thereof is given under Section 6(b)(i) on action to
avoid that Termination Event.

 

(iv)          Right to Terminate.  If:—

 

(1)           a transfer under
Section 6(b)(ii) or an agreement under Section 6(b)(iii), as the case
may be, has not been effected with respect to all Affected Transactions within
30 days after an Affected Party gives notice under Section 6(b)(i); or

 

(2)           an Illegality under
Section 5(b)(i)(2), a Credit Event Upon Merger or an Additional
Termination Event occurs, or a Tax Event Upon Merger occurs and the Burdened
Party is not the Affected Party,

 

either party in the case
of an Illegality, the Burdened Party in the case of a Tax Event Upon Merger,
any Affected Party in the case of a Tax Event or an Additional Termination
Event if there is more than one Affected Party, or the party which is not the
Affected Party in the case of a Credit Event Upon Merger or an Additional
Termination Event if there is only one Affected Party may, by not more than 20
days notice to the other party and provided that the relevant Termination Event
is then continuing, designate a day not earlier than the day such notice is
effective as an Early Termination Date in respect of all Affected Transactions.

 

(c)           Effect of Designation.

 

(i)            If notice designating
an Early Termination Date is given under Section 6(a) or (b), the Early
Termination Date will occur on the date so designated, whether or not the
relevant Event of Default or Termination Event is then continuing.

 

(ii)           Upon the occurrence or
effective designation of an Early Termination Date, no further payments or
deliveries under Section 2(a)(i) or 2(e) in respect of the Terminated
Transactions will be required to be made, but without prejudice to the other provisions
of this Agreement.  The amount, if any,
payable in respect of an Early Termination Date shall be determined pursuant to
Section 6(e).

 

(d)           Calculations.

 

(i)            Statement. 
On or as soon as reasonably practicable following the occurrence of an
Early Termination Date, each party will make the calculations on its part, if
any, contemplated by Section 6(e) and will provide to the other party a
statement (1) showing, in reasonable detail, such calculations (including all
relevant quotations and specifying any amount payable under Section 6(e))
and (2) giving details of the relevant account to which any amount payable to
it is to be paid.  In the absence of
written confirmation from the source of a quotation obtained in determining a
Market Quotation, the records of the party obtaining such quotation will be
conclusive evidence of the existence and accuracy of such quotation.

 

(ii)           Payment Date.  An amount calculated as being due in respect of any Early
Termination Date under Section 6(e) will be payable on the day that notice
of the amount payable is effective 

 

10

 

(in the case of an Early
Termination Date which is designated or occurs as a result of an Event of
Default) and on the day which is two Local Business Days after the day on which
notice of the amount payable is effective (in the case of an Early Termination
Date which is designated as a result of a Termination Event).  Such amount will be paid together with (to
the extent permitted under applicable law) interest thereon (before as well as
after judgment) in the Termination Currency, from (and including) the relevant
Early Termination Date to (but excluding) the date such amount is paid, at the
Applicable Rate.  Such interest will be
calculated on the basis of daily compounding and the actual number of days
elapsed.

 

(e)           Payments on Early Termination.  If an Early Termination Date occurs, the
following provisions shall apply based on the parties’ election in the
Schedule of a payment measure, either “Market Quotation” or “Loss”, and a
payment method, either the “First Method” or the “Second Method”.  If the parties fail to designate a payment
measure or payment method in the Schedule, it will be deemed that “Market
Quotation” or the “Second Method”, as the case may be, shall apply.  The amount, if any, payable in respect of an
Early Termination Date and determined pursuant to this Section will be
subject to any Set-off.

 

(i)            Events of Default.  If the Early Termination Date results from an Event of Default:—

 

(1)           First Method and Market Quotation.  If the First Method and Market Quotation
apply, the Defaulting Party will pay to the Non-defaulting Party the excess, if
a positive number, of (A) the sum of the Settlement Amount (determined by the
Non-defaulting Party) in respect of the Terminated Transactions and the
Termination Currency Equivalent of the Unpaid Amounts owing to the
Non-defaulting Party over (B) the Termination Currency Equivalent of the Unpaid
Amounts owing to the Defaulting Party.

 

(2)           First Method and Loss.  If the First Method and Loss apply, the
Defaulting Party will pay to the Non-defaulting Party, if a positive number,
the Non-defaulting Party’s Loss in respect of this Agreement.

 

(3)           Second Method and Market Quotation.  If the Second Method and Market Quotation
apply, an amount will be payable equal to (A) the sum of the Settlement Amount
(determined by the Non-defaulting Party) in respect of the Terminated
Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing
to the Non-defaulting Party less (B) the Termination Currency Equivalent of the
Unpaid Amounts owing to the Defaulting Party. 
If that amount is a positive number, the Defaulting Party will pay it to
the Non-defaulting Party; if it is a negative number, the Non-defaulting Party
will pay the absolute value of that amount to the Defaulting Party.

 

(4)           Second Method and Loss.  If the Second Method and Loss apply, an
amount will be payable equal to the Non-defaulting Party’s Loss in respect of
this Agreement.  If that amount is a
positive number, the Defaulting Party will pay it to the Non-defaulting Party;
if it is a negative number, the Non-defaulting Party will pay the absolute
value of that amount to the Defaulting Party.

 

(ii)           Termination Events.  If the Early Termination Date results from a Termination Event:—

 

(1)           One Affected Party.  If there is one Affected Party, the amount
payable will be determined in accordance with Section 6(e)(i)(3), if
Market Quotation applies, or Section 6(e)(i)(4), if Loss applies, except
that, in either case, references to the Defaulting Party and to the
Non-defaulting Party will be deemed to be references to the Affected Party and 

 

11

 

the party which is not
the Affected Party, respectively, and, if Loss applies and fewer than all the
Transactions are being terminated, Loss shall be calculated in respect of all
Terminated Transactions.

 

(2)           Two Affected Parties.  If there are two Affected Parties:—

 

(A)  if Market Quotation applies, each party will
determine a Settlement Amount in respect of the Terminated Transactions, and an
amount will be payable equal to (I) the sum of (a) one-half of the difference
between the Settlement Amount of the party with the higher Settlement Amount
(“X”) and the Settlement Amount of the party with the lower Settlement Amount
(“Y”) and (b) the Termination Currency Equivalent of the Unpaid Amounts owing
to X less (II) the Termination Currency Equivalent of the Unpaid Amounts owing
to Y; and

 

(B)  if Loss applies, each party will determine
its Loss in respect of this Agreement (or, if fewer than all the Transactions
are being terminated, in respect of all Terminated Transactions) and an amount
will be payable equal to one-half of the difference between the Loss of the
party with the higher Loss (“X”) and the Loss of the party with the lower Loss
(“Y”).

 

If the amount payable is
a positive number, Y will pay it to X; if it is a negative number, X will pay
the absolute value of that amount to Y.

 

(iii)          Adjustment for Bankruptcy.  In circumstances where an Early Termination
Date occurs because “Automatic Early Termination” applies in respect of a
party, the amount determined under this Section 6(e) will be subject to
such adjustments as are appropriate and permitted by law to reflect any
payments or deliveries made by one party to the other under this Agreement (and
retained by such other party) during the period from the relevant Early
Termination Date to the date for payment determined under Section 6(d)(ii).

 

(iv)          Pre-Estimate.  The parties agree that if Market Quotation applies an amount
recoverable under this Section 6(e) is a reasonable pre-estimate of loss
and not a penalty.  Such amount is
payable for the loss of bargain and the loss of protection against future risks
and except as otherwise provided in this Agreement neither party will be
entitled to recover any additional damages as a consequence of such losses.

 

7.             Transfer

 

Subject to
Section 6(b)(ii), neither this Agreement nor any interest or obligation in
or under this Agreement may be transferred (whether by way of security or
otherwise) by either party without the prior written consent of the other
party, except that:—

 

(a)           a party may make such a
transfer of this Agreement pursuant to a consolidation or amalgamation with, or
merger with or into, or transfer of all or substantially all its assets to,
another entity (but without prejudice to any other right or remedy under this
Agreement); and

 

(b)           a party may make such a
transfer of all or any part of its interest in any amount payable to it from a
Defaulting Party under Section 6(e).

 

Any purported transfer
that is not in compliance with this Section will be void.

 

12

 

8.             Contractual
Currency

 

(a)           Payment in the Contractual Currency.  Each payment under this Agreement will be
made in the relevant currency specified in this Agreement for that payment (the
“Contractual Currency”).  To the extent
permitted by applicable law, any obligation to make payments under this
Agreement in the Contractual Currency will not be discharged or satisfied by
any tender in any currency other than the Contractual Currency, except to the
extent such tender results in the actual receipt by the party to which payment
is owed, acting in a reasonable manner and in good faith in converting the
currency so tendered into the Contractual Currency, of the full amount in the
Contractual Currency of all amounts payable in respect of this Agreement.  If for any reason the amount in the
Contractual Currency so received falls short of the amount in the Contractual
Currency payable in respect of this Agreement, the party required to make the
payment will, to the extent permitted by applicable law, immediately pay such
additional amount in the Contractual Currency as may be necessary to compensate
for the shortfall.  If for any reason
the amount in the Contractual Currency so received exceeds the amount in the
Contractual Currency payable in respect of this Agreement, the party receiving
the payment will refund promptly the amount of such excess.

 

(b)           Judgments. 
To the extent permitted by applicable law, if any judgment or order
expressed in a currency other than the Contractual Currency is rendered (i) for
the payment of any amount owing in respect of this Agreement, (ii) for the
payment of any amount relating to any early termination in respect of this
Agreement or (iii) in respect of a judgment or order of another court for the
payment of any amount described in (i) or (ii) above, the party seeking
recovery, after recovery in full of the aggregate amount to which such party is
entitled pursuant to the judgment or order, will be entitled to receive
immediately from the other party the amount of any shortfall of the Contractual
Currency received by such party as a consequence of sums paid in such other
currency and will refund promptly to the other party any excess of the
Contractual Currency received by such party as a consequence of sums paid in
such other currency if such shortfall or such excess arises or results from any
variation between the rate of exchange at which the Contractual Currency is
converted into the currency of the judgment or order for the purposes of such
judgment or order and the rate of exchange at which such party is able, acting
in a reasonable manner and in good faith in converting the currency received
into the Contractual Currency, to purchase the Contractual Currency with the
amount of the currency of the judgment or order actually received by such
party.  The term “rate of exchange”
includes, without limitation, any premiums and costs of exchange payable in
connection with the purchase of or conversion into the Contractual Currency.

 

(c)           Separate Indemnities.  To the extent permitted by applicable law,
these indemnities constitute separate and independent obligations from the
other obligations in this Agreement, will be enforceable as separate and
independent causes of action, will apply notwithstanding any indulgence granted
by the party to which any payment is owed and will not be affected by judgment
being obtained or claim or proof being made for any other sums payable in
respect of this Agreement.

 

(d)           Evidence of Loss.  For the purpose of this Section 8, it will be sufficient for
a party to demonstrate that it would have suffered a loss had an actual
exchange or purchase been made.

 

9.             Miscellaneous

 

(a)           Entire Agreement.  This Agreement constitutes the entire agreement and understanding
of the parties with respect to its subject matter and supersedes all oral
communication and prior writings with respect thereto.

 

13

 

(b)           Amendments. 
No amendment, modification or waiver in respect of this Agreement will
be effective unless in writing (including a writing evidenced by a facsimile
transmission) and executed by each of the parties or confirmed by an exchange
of telexes or electronic messages on an electronic messaging system.

 

(c)           Survival of Obligations.  Without prejudice to Sections 2(a)(iii) and
6(c)(ii), the obligations of the parties under this Agreement will survive the
termination of any Transaction.

 

(d)           Remedies Cumulative.  Except as provided in this Agreement, the
rights, powers, remedies and privileges provided in this Agreement are
cumulative and not exclusive of any rights, powers, remedies and privileges
provided by law.

 

(e)           Counterparts and
Confirmations.

 

(i)            This Agreement (and
each amendment, modification and waiver in respect of it) may be executed and
delivered in counterparts (including by facsimile transmission), each of which
will be deemed an original.

 

(ii)           The parties intend that
they are legally bound by the terms of each Transaction from the moment they
agree to those terms (whether orally or otherwise).  A Confirmation shall he entered into as soon as practicable and
may he executed and delivered in counterparts (including by facsimile
transmission) or be created by an exchange of telexes or by an exchange of
electronic messages on an electronic messaging system, which in each case will
be sufficient for all purposes to evidence a binding supplement to this
Agreement.  The parties will specify
therein or through another effective means that any such counterpart, telex or
electronic message constitutes a Confirmation.

 

(f)            No Waiver of Rights.  A failure or delay in exercising any right,
power or privilege in respect of this Agreement will not be presumed to operate
as a waiver, and a single or partial exercise of any right, power or privilege
will not be presumed to preclude any subsequent or further exercise, of that
right, power or privilege or the exercise of any other right, power or
privilege.

 

(g)           Headings. 
The headings used in this Agreement are for convenience of reference
only and are not to affect the construction of or to be taken into
consideration in interpreting this Agreement.

 

10.          Offices; Multibranch
Parties

 

(a)           If Section 10(a)
is specified in the Schedule as applying, each party that enters into a
Transaction through an Office other than its head or home office represents to
the other party that, notwithstanding the place of booking office or
jurisdiction of incorporation or organisation of such party, the obligations of
such party are the same as if it had entered into the Transaction through its
head or home office. This representation will be deemed to be repeated by such
party on each date on which a Transaction is entered into.

 

(b)           Neither party may
change the Office through which it makes and receives payments or deliveries
for the purpose of a Transaction without the prior written consent of the other
party.

 

(c)           If a party is specified
as a Multibranch Party in the Schedule, such Multibranch Party may make and
receive payments or deliveries under any Transaction through any Office listed
in the Schedule, and the Office through which it makes and receives payments or
deliveries with respect to a Transaction will be specified in the relevant
Confirmation.

 

14

 

11.          Expenses

 

A Defaulting Party will,
on demand, indemnify and hold harmless the other party for and against all
reasonable out-of-pocket expenses, including legal fees and Stamp Tax, incurred
by such other party by reason of the enforcement and protection of its rights
under this Agreement or any Credit Support Document to which the Defaulting
Party is a party or by reason of the early termination of any Transaction,
including, but not limited to, costs of collection.

 

12.          Notices

 

(a)           Effectiveness.  Any notice or other communication in respect of this Agreement
may be given in any manner set forth below (except that a notice or other
communication under Section 5 or 6 may not be given by facsimile
transmission or electronic messaging system) to the address or number or in
accordance with the electronic messaging system details provided (see the
Schedule) and will be deemed effective as indicated:—

 

(i)            if in writing and
delivered in person or by courier, on the date it is delivered;

 

(ii)           if sent by telex, on
the date the recipient’s answerback is received;

 

(iii)          if sent by facsimile
transmission, on the date that transmission is received by a responsible
employee of the recipient in legible form (it being agreed that the burden of
proving receipt will be on the sender and will not be met by a transmission
report generated by the sender’s facsimile machine);

 

(iv)          if sent by certified or
registered mail (airmail, if overseas) or the equivalent (return receipt
requested), on the date that mail is delivered or its delivery is attempted; or

 

(v)           if sent by electronic
messaging system, on the date that electronic message is received,

 

unless the date of that
delivery (or attempted delivery) or that receipt, as applicable, is not a Local
Business Day or that communication is delivered (or attempted) or received, as
applicable, after the close of business on a Local Business Day, in which case
that communication shall be deemed given and effective on the first following
day that is a Local Business Day.

 

(b)           Change of Addresses.  Either party may by notice to the other change
the address, telex or facsimile number or electronic messaging system details
at which notices or other communications are to be given to it.

 

13.          Governing Law and
Jurisdiction

 

(a)           Governing Law.  This Agreement will be governed by and construed in accordance
with the law specified in the Schedule.

 

(b)           Jurisdiction.  With respect to any suit, action or proceedings relating to this
Agreement (“Proceedings”), each party irrevocably:—

 

(i)            submits to the
jurisdiction of the English courts, if this Agreement is expressed to be
governed by English law, or to the non-exclusive jurisdiction of the courts of
the State of New York and the United States District Court located in the
Borough of Manhattan in New York City, if this Agreement is expressed to be governed
by the laws of the State of New York; and

 

15

 

(ii)           waives any objection
which it may have at any time to the laying of venue of any Proceedings brought
in any such court, waives any claim that such Proceedings have been brought in
an inconvenient forum and further waives the right to object, with respect to
such Proceedings, that such court does not have any jurisdiction over such
party.

 

Nothing in this Agreement
precludes either party from bringing Proceedings in any other jurisdiction
(outside, if this Agreement is expressed to be governed by English law, the
Contracting States, as defined in Section 1(3) of the Civil Jurisdiction
and Judgments Act 1982 or any modification, extension or re-enactment thereof
for the time being in force) nor will the bringing of Proceedings in any one or
more jurisdictions preclude the bringing of Proceedings in any other
jurisdiction.

 

(c)           Service of Process.  Each party irrevocably appoints the Process Agent (if any)
specified opposite its name in the Schedule to receive, for it and on its
behalf, service of process in any Proceedings. 
If for any reason any party’s Process Agent is unable to act as such,
such party will promptly notify the other party and within 30 days appoint a
substitute process agent acceptable to the other party.  The parties irrevocably consent to service
of process given in the manner provided for notices in Section 12.  Nothing in this Agreement will affect the
right of either party to serve process in any other manner permitted by law.

 

(d)           Waiver of Immunities.  Each party irrevocably waives, to the
fullest extent permitted by applicable law, with respect to itself and its
revenues and assets (irrespective of their use or intended use), all immunity
on the grounds of sovereignty or other similar grounds from (i) suit, (ii)
jurisdiction of any court, (iii) relief by way of injunction, order for
specific performance or for recovery of property, (iv) attachment of its assets
(whether before or after judgment) and (v) execution or enforcement of any
judgment to which it or its revenues or assets might otherwise be entitled in
any Proceedings in the courts of any jurisdiction and irrevocably agrees, to
the extent permitted by applicable law, that it will not claim any such
immunity in any Proceedings.

 

14.          Definitions

 

As used in this
Agreement:—

 

“Additional Termination Event” has the
meaning specified in Section 5(b).

 

“Affected Party” has the meaning
specified in Section 5(b).

 

“Affected Transactions” means (a) with
respect to any Termination Event consisting of an Illegality, Tax Event or Tax
Event Upon Merger, all Transactions affected by the occurrence of such
Termination Event and (b) with respect to any other Termination Event, all
Transactions.

 

“Affiliate” means, subject to the
Schedule, in relation to any person, any entity controlled, directly or
indirectly, by the person, any entity that controls, directly or indirectly,
the person or any entity directly or indirectly under common control with the
person.  For this purpose, “control” of
any entity or person means ownership of a majority of the voting power of the
entity or person.

 

“Applicable Rate” means:—

 

(a)           in respect of
obligations payable or deliverable (or which would have been but for
Section 2(a)(iii)) by a Defaulting Party, the Default Rate;

 

16

 

(b)           in respect of an
obligation to pay an amount under Section 6(e) of either party from and
after the date (determined in accordance with Section 6(d)(ii)) on which
that amount is payable, the Default Rate;

 

(c)           in respect of all other
obligations payable or deliverable (or which would have been but for
Section 2(a)(iii)) by a Non-defaulting Party, the Non-default Rate; and

 

(d)           in all other cases, the
Termination Rate.

 

“Burdened Party” has the meaning
specified in Section 5(b).

 

“Change in Tax Law” means the
enactment, promulgation, execution or ratification of, or any change in or
amendment to, any law (or in the application or official interpretation of any
law) that occurs on or after the date on which the relevant Transaction is
entered into.

 

“consent” includes a consent,
approval, action, authorisation, exemption, notice, filing, registration or
exchange control consent.

 

“Credit Event Upon Merger” has the
meaning specified in Section 5(b).

 

“Credit Support Document” means any
agreement or instrument that is specified as such in this Agreement.

 

“Credit Support Provider” has the
meaning specified in the Schedule.

 

“Default Rate” means a rate per annum
equal to the cost (without proof or evidence of any actual cost) to the
relevant payee (as certified by it) if it were to fund or of funding the
relevant amount plus 1% per annum.

 

“Defaulting Party” has the meaning
specified in Section 6(a).

 

“Early Termination Date” means the
date determined in accordance with Section 6(a) or 6(b)(iv).

 

“Event of Default” has the meaning
specified in Section 5(a) and, if applicable, in the Schedule.

 

“Illegality” has the meaning specified
in Section 5(b).

 

“Indemnifiable Tax” means any Tax
other than a Tax that would not be imposed in respect of a payment under this
Agreement but for a present or former connection between the jurisdiction of
the government or taxation authority imposing such Tax and the recipient of
such payment or a person related to such recipient (including, without
limitation, a connection arising from such recipient or related person being or
having been a citizen or resident of such jurisdiction, or being or having been
organised, present or engaged in a trade or business in such jurisdiction, or
having or having had a permanent establishment or fixed place of business in
such jurisdiction, but excluding a connection arising solely from such
recipient or related person having executed, delivered, performed its
obligations or received a payment under, or enforced, this Agreement or a
Credit Support Document).

 

“law” includes any treaty, law, rule
or regulation (as modified, in the case of tax matters, by the practice of any
relevant governmental revenue authority) and “lawful” and “unlawful” will be
construed accordingly.

 

“Local Business Day” means, subject to
the Schedule, a day on which commercial banks are open for business (including
dealings in foreign exchange and foreign currency deposits) (a) in relation to
any 

 

17

 

obligation under
Section 2(a)(i), in the place(s) specified in the relevant Confirmation
or, if not so specified, as otherwise agreed by the parties in writing or determined
pursuant to provisions contained, or incorporated by reference, in this
Agreement, (b) in relation to any other payment, in the place where the
relevant account is located and, if different, in the principal financial
centre, if any, of the currency of such payment, (c) in relation to any notice
or other communication, including notice contemplated under
Section 5(a)(i), in the city specified in the address for notice provided
by the recipient and, in the case of a notice contemplated by Section 2(b),
in the place where the relevant new account is to be located and (d) in
relation to Section 5(a)(v)(2), in the relevant locations for performance
with respect to such Specified Transaction.

 

“Loss” means, with respect to this
Agreement or one or more Terminated Transactions, as the case may be, and a
party, the Termination Currency Equivalent of an amount that party reasonably
determines in good faith to be its total losses and costs (or gain, in which
case expressed as a negative number) in connection with this Agreement or that
Terminated Transaction or group of Terminated Transactions, as the case may be,
including any loss of bargain, cost of funding or, at the election of such
party but without duplication, loss or cost incurred as a result of its terminating,
liquidating, obtaining or reestablishing any hedge or related trading position
(or any gain resulting from any of them). 
Loss includes losses and costs (or gains) in respect of any payment or
delivery required to have been made (assuming satisfaction of each applicable
condition precedent) on or before the relevant Early Termination Date and not
made, except, so as to avoid duplication, if Section 6(e)(i)(1) or (3) or
6(e)(ii)(2)(A) applies.  Loss does not
include a party’s legal fees and out-of-pocket expenses referred to under
Section 11.  A party will determine
its Loss as of the relevant Early Termination Date, or, if that is not
reasonably practicable, as of the earliest date thereafter as is reasonably
practicable.  A party may (but need not)
determine its Loss by reference to quotations of relevant rates or prices from
one or more leading dealers in the relevant markets.

 

“Market Quotation” means, with respect
to one or more Terminated Transactions and a party making the determination, an
amount determined on the basis of quotations from Reference Market-makers.  Each quotation will be for an amount, if
any, that would be paid to such party (expressed as a negative number) or by
such party (expressed as a positive number) in consideration of an agreement
between such party (taking into account any existing Credit Support Document
with respect to the obligations of such party) and the quoting Reference
Market-maker to enter into a transaction (the “Replacement Transaction”) that
would have the effect of preserving for such party the economic equivalent of
any payment or delivery (whether the underlying obligation was absolute or
contingent and assuming the satisfaction of each applicable condition
precedent) by the parties under Section 2(a)(i) in respect of such
Terminated Transaction or group of Terminated Transactions that would, but for
the occurrence of the relevant Early Termination Date, have been required after
that date.  For this purpose, Unpaid
Amounts in respect of the Terminated Transaction or group of Terminated
Transactions are to be excluded but, without limitation, any payment or
delivery that would, but for the relevant Early Termination Date, have been
required (assuming satisfaction of each applicable condition precedent) after
that Early Termination Date is to be included. 
The Replacement Transaction would be subject to such documentation as
such party and the Reference Market-maker may, in good faith, agree.  The party making the determination (or its
agent) will request each Reference Market-maker to provide its quotation to the
extent reasonably practicable as of the same day and time (without regard to
different time zones) on or as soon as reasonably practicable after the
relevant Early Termination Date.  The
day and time as of which those quotations are to be obtained will be selected
in good faith by the party obliged to make a determination under
Section 6(e), and, if each party is so obliged, after consultation with
the other.  If more than three
quotations are provided, the Market Quotation will be the arithmetic mean of
the quotations, without regard to the quotations having the highest and lowest
values.  If exactly three such
quotations are provided, the Market Quotation will be the quotation remaining
after disregarding the highest and lowest quotations.  For this purpose, if more than one quotation has the same highest
value or lowest value, then one of such 

 

18

 

quotations shall be
disregarded.  If fewer than three
quotations are provided, it will be deemed that the Market Quotation in respect
of such Terminated Transaction or group of Terminated Transactions cannot be
determined.

 

“Non-default Rate” means a rate per
annum equal to the cost (without proof or evidence of any actual cost) to the
Non-defaulting Party (as certified by it) if it were to fund the relevant
amount.

 

“Non-defaulting Party” has the meaning
specified in Section 6(a).

 

“Office” means a branch or office of a
party, which may be such party’s head or home office.

 

“Potential Event of Default” means any
event which, with the giving of notice or the lapse of time or both, would
constitute an Event of Default.

 

“Reference Market-makers” means four
leading dealers in the relevant market selected by the party determining a
Market Quotation in good faith (a) from among dealers of the highest credit
standing which satisfy all the criteria that such party applies generally at
the time in deciding whether to offer or to make an extension of credit and (b)
to the extent practicable, from among such dealers having an office in the same
city.

 

“Relevant Jurisdiction” means, with
respect to a party, the jurisdictions (a) in which the party is incorporated,
organised, managed and controlled or considered to have its seat, (b) where an
Office through which the party is acting for purposes of this Agreement is
located, (c) in which the party executes this Agreement and (d) in relation to
any payment, from or through which such payment is made.

 

“Scheduled Payment Date” means a date
on which a payment or delivery is to be made under Section 2(a)(i) with
respect to a Transaction.

 

“Set-off” means set-off, offset,
combination of accounts, right of retention or withholding or similar right or
requirement to which the payer of an amount under Section 6 is entitled or
subject (whether arising under this Agreement, another contract, applicable law
or otherwise) that is exercised by, or imposed on, such payer.

 

“Settlement Amount” means, with
respect to a party and any Early Termination Date, the sum of:—

 

(a)           the Termination
Currency Equivalent of the Market Quotations (whether positive or negative) for
each Terminated Transaction or group of Terminated Transactions for which a
Market Quotation is determined; and

 

(b)           such party’s Loss
(whether positive or negative and without reference to any Unpaid Amounts) for
each Terminated Transaction or group of Terminated Transactions for which a
Market Quotation cannot be determined or would not (in the reasonable belief of
the party making the determination) produce a commercially reasonable result.

 

“Specified Entity” has the meanings
specified in the Schedule.

 

“Specified Indebtedness” means,
subject to the Schedule, any obligation (whether present or future, contingent
or otherwise, as principal or surety or otherwise) in respect of borrowed
money.

 

19

 

“Specified Transaction” means, subject
to the Schedule, (a) any transaction (including an agreement with respect
thereto) now existing or hereafter entered into between one party to this
Agreement (or any Credit Support Provider of such party or any applicable
Specified Entity of such party) and the other party to this Agreement (or any
Credit Support Provider of such other party or any applicable Specified Entity
of such other party) which is a rate swap transaction, basis swap, forward rate
transaction, commodity swap, commodity option, equity or equity index swap,
equity or equity index option, bond option, interest rate option, foreign
exchange transaction, cap transaction, floor transaction, collar transaction,
currency swap transaction, cross-currency rate swap transaction, currency
option or any other similar transaction (including any option with respect to
any of these transactions), (b) any combination of these transactions and (c)
any other transaction identified as a Specified Transaction in this Agreement
or the relevant confirmation.

 

“Stamp Tax” means any stamp,
registration, documentation or similar tax.

 

“Tax” means any present or future tax,
levy, impost, duty, charge, assessment or fee of any nature (including
interest, penalties and additions thereto) that is imposed by any government or
other taxing authority in respect of any payment under this Agreement other
than a stamp, registration, documentation or similar tax.

 

“Tax Event” has the meaning specified
in Section 5(b).

 

“Tax Event Upon Merger” has the
meaning specified in Section 5(b).

 

“Terminated Transactions” means with
respect to any Early Termination Date (a) if resulting from a Termination
Event, all Affected Transactions and (b) if resulting from an Event of Default,
all Transactions (in either case) in effect immediately before the
effectiveness of the notice designating that Early Termination Date (or, if “Automatic
Early Termination” applies, immediately before that Early Termination Date).

 

“Termination Currency” has the meaning
specified in the Schedule.

 

20

 

“Termination Currency Equivalent”
means, in respect of any amount denominated in the Termination Currency, such
Termination Currency amount and, in respect of any amount denominated in a
currency other than the Termination Currency (the “Other Currency”), the amount
in the Termination Currency determined by the party making the relevant
determination as being required to purchase such amount of such Other Currency
as at the relevant Early Termination Date, or, if the relevant Market Quotation
or Loss (as the case may be), is determined as of a later date, that later
date, with the Termination Currency at the rate equal to the spot exchange rate
of the foreign exchange agent (selected as provided below) for the purchase of
such Other Currency with the Termination Currency at or about 11:00 a.m. (in
the city in which such foreign exchange agent is located) on such date as would
be customary for the determination of such a rate for the purchase of such
Other Currency for value on the relevant Early Termination Date or that later
date.  The foreign exchange agent will,
if only one party is obliged to make a determination under Section 6(e),
be selected in good faith by that party and otherwise will be agreed by the
parties.

 

“Termination Event” means an
Illegality, a Tax Event or a Tax Event Upon Merger or, if specified to be
applicable, a Credit Event Upon Merger or an Additional Termination Event.

 

“Termination Rate” means a rate per
annum equal to the arithmetic mean of the cost (without proof or evidence of
any actual cost) to each party (as certified by such party) if it were to fund
or of funding such amounts.

 

“Unpaid Amounts” owing to any party
means, with respect to an Early Termination Date, the aggregate of (a) in
respect of all Terminated Transactions, the amounts that became payable (or
that would have become payable but for Section 2(a)(iii)) to such party
under Section 2(a)(i) on or prior to such Early Termination Date and which
remain unpaid as at such Early Termination Date and (b) in respect of each
Terminated Transaction, for each obligation under Section 2(a)(i) which
was (or would have been but for Section 2(a)(iii)) required to be settled
by delivery to such party on or prior to such Early Termination Date and which
has not been so settled as at such Early Termination Date, an amount equal to
the fair market 

 

 

value of that which was
(or would have been) required to be delivered as of the originally scheduled
date for delivery, in each case together with (to the extent permitted under
applicable law) interest, in the currency, of such amounts, from (and
including) the date such amounts or obligations were or would have been
required to have been paid or performed to (but excluding) such Early
Termination Date, at the Applicable Rate. Such amounts of interest will be
calculated on the basis of daily compounding and the actual number of days
elapsed. The fair market value of any obligation referred to in clause (b)
above shall be reasonably determined by the party obliged to make the
determination under Section 6(e) or, if each party is so obliged, it shall
be the average of the Termination Currency Equivalents of the fair market
values reasonably determined by both parties.

 

IN WITNESS WHEREOF the
parties have executed this document on the respective dates specified below
with effect from the date specified on the first page of this document.

 

 

	
  Barclays Bank PLC (“Barclays”)

  	
   

  	
  World Financial Network Credit Card Master 

  
	
  (Name of Party)

  	
   

  	
  Note Trust (“Counterparty”)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  Chase Manhattan Bank USA, National

  
	
   

  	
   

  	
   

  	
  Association, not in its individual capacity,

  but solely as Owner Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (Name of Party)

  

 

 

	
  By:

  	
  /s/ Justin Wray

  	
   

  	
   

  	
  By:

  	
  /s/ John J. Cashin

  	
   

  
	
   

  	
  Name: Justin Wray

  	
   

  	
   

  	
  Name:  John J. Cashin

  
	
   

  	
  Title:   Director

  	
   

  	
   

  	
  Title:   Vice President

  
	
   

  	
  Date:   September 22, 2004

  	
   

  	
   

  	
  Date:   September 22, 2004

  

 

CLASS B
SWAP

 

 

SCHEDULE

to the

Master Agreement

 

dated as of
September 22, 2004

 

between

 

 

	
  Barclays
  Bank PLC

  	
  and

  	
  World
  Financial Network Credit Card

  Master Note Trust

  
	
   

  	
   

  	
   

  
	
  (“Barclays”)

  	
   

  	
  (the
  “Counterparty”)

  
	
   

  	
   

  	
   

  

 

The only Transaction that
will be governed by the terms of this Agreement will be the Class B Swap (as
defined in the Indenture).  References
in the Agreement to “Transactions” or “Transaction” shall be deemed to be
references to the Class B Swap.

 

Part 1

 

Termination Provisions

 

In this Agreement:-

 

(1)           “Specified Entity”
shall not apply.

 

(2)           The “Breach of
Agreement” provisions of Section 5(a)(ii) will apply to Barclays and will
not apply to the Counterparty.

 

(3)           The “Credit Support
Default” provisions of Section 5(a)(iii) will apply to Barclays and will
not apply to the Counterparty.

 

(4)           The “Misrepresentation”
provisions of Section 5(a)(iv) will apply to Barclays and will not apply
to the Counterparty.

 

(5)           The “Default Under
Specified Transaction” provisions of Section 5(a)(v) will not apply to
Barclays and will not apply to the Counterparty.

 

(6)           The “Cross Default”
provisions of Section 5(a)(vi) will not apply to Barclays and will not
apply to the Counterparty.

 

(7)           The “Merger Without
Assumption” provisions of Section 5(a)(viii) will apply to Barclays and
will not apply to the Counterparty.

 

(8)           The “Tax Event”
provisions of Section 5(b)(ii) will not apply to Barclays and will not
apply to the Counterparty.

 

(9)           The “Tax Event Upon
Merger” provisions of Section 5(b)(iii) will not apply to Barclays and will
not apply to the Counterparty.

 

 

(10)         The “Credit Event Upon
Merger” provisions of Section 5(b)(iv) will not apply to Barclays and will
not apply to the Counterparty.

 

(11)         The “Additional
Termination Event” provisions of Section 5(b)(v) will apply as set forth
in Part 1(15) hereof.

 

(12)         The “Automatic Early
Termination” provisions of Section 6(a) will not apply to Barclays and
will not apply to the Counterparty.

 

(13)         “Termination Currency”
means United States Dollars.

 

(14)         For purposes of computing
amounts payable on early termination:

 

(a)           Market Quotation will
apply to this Agreement; and

 

(b)           The Second Method will
apply to this Agreement.

 

(15)         The occurrence of the
following event shall constitute an “Additional Termination Event” for purposes
of Section 5(b)(v):

 

(a) the occurrence of an
Additional Termination Event as forth in Part 5 (10) hereof.  If this Additional Termination Event occurs,
Barclays shall be the sole Affected Party and all Transactions then outstanding
between the parties shall be Affected Transactions.

 

Upon the occurrence of an
Additional Termination Event, Barclays shall notify the Rating Agencies of such
occurrence.

 

Part 2

 

Tax Representations

 

(1)           Payer Tax
Representation:

 

For the purpose of
Section 3(e) of this Agreement, Barclays and Counterparty each make the
following representation:

 

It is not required by any
applicable law, as modified by the practice of any relevant governmental
revenue authority, of any Relevant Jurisdiction to make any deduction or
withholding for or on account of any Tax from any payment (other than interest
under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to be made by it
to the other party under this Agreement. 
In making this representation, it may rely on:

 

(i)            the accuracy of any
representations made by the other party pursuant to Section 3(f) of this
Agreement;

 

(ii)           the satisfaction of the
agreement of the other party contained in Section 4(a)(i) or 4(a)(iii) of
this Agreement and the accuracy and effectiveness of any document provided by
the other party pursuant to Section 4(a)(i) or 4(a)(iii) of this
Agreement; and

 

(iii)          the satisfaction of the
agreement of the other party contained in Section 4(d) of this Agreement,
provided that it shall not be a breach of this representation where reliance is
placed on clause (ii) and the other party does not deliver a form or document
under 

 

 

Section 4(a)(iii)
of this Agreement by reason of material prejudice to its legal or commercial
position.

 

(2)           Barclays Payee Tax
Representations:

 

For the purpose of
Section 3(f), Barclays makes the following representations, which apply to
Barclays with respect to that portion of its payments that are not attributable
to Barclays’ U.S. trade or business:

 

(i)            With respect to
payments made to Barclays that are not effectively connected to the United
States: It is a non-U.S. branch of a foreign person for United States federal
income tax purposes;

 

(ii)           With respect to
payments made to Barclays that are effectively connected to the United States:
Each payment received or to be received by it in connection with this Agreement
will be effectively connected with its conduct of a trade or  business in the United States; and

 

(iii)          Each payment received or
to be received by Barclays in connection with this Agreement may, in whole or
in part, be effectively connected with the conduct of a trade or business by
Barclays in the United States and the Counterparty may treat the full amount of
each such payment as effectively connected with the conduct of a trade or business
by Barclays in the United States for United States information reporting
purposes.

 

(3)           Counterparty Payee Tax
Representations:

 

For the purpose of
Section 3(f), the Counterparty represents that it is a United States
Person for U.S. federal income tax purposes and either (a) is a financial
institution or (b) is not acting as an agent for a person that is not a United
States Person for U.S. federal income tax purposes.

 

Part 3

 

Agreement to Deliver Documents

 

For the purpose of
Sections 4(a)(i) and (ii), each party agrees to deliver the following
documents, as applicable:

 

(1)           For the purpose of
Sections 4(a)(i) and (ii) of this Agreement, Counterparty agrees to deliver a
complete and accurate United States Internal Revenue Service Form W-9 (or any
applicable successor form), in a manner reasonably satisfactory to Barclays,
(I) upon execution of this Agreement; (II) promptly upon reasonable demand of
Barclays, and (III) promptly upon learning that any such form previously filed
by Counterparty has become obsolete or incorrect.

 

(2)           Barclays will, on
demand, deliver a certificate (or, if available, the current authorized
signature book of Barclays) specifying the names, title and specimen signatures
of the persons authorized to execute this Agreement and each Confirmation on
its behalf.

 

(3)           The Counterparty will,
on demand, deliver a certificate (or, if available, the current authorized
signature book of the Counterparty) specifying the names, title and specimen
signatures of the persons authorized to execute this Agreement and each
Confirmation on its behalf.

 

 

(4)           The Counterparty will,
upon execution of this Agreement, deliver a conformed copy of the Indenture and
the Indenture Supplement.

 

(5)           Each party will, upon
execution of this Agreement, deliver a legal opinion of counsel in form and
substance satisfactory to the other party regarding this Agreement and any
other matters as such other party may reasonably request.

 

(6)           The Counterparty shall
supply (and/or shall instruct the Trustee to supply) Barclays with copies of
the monthly servicing reports delivered to the Series 2004-C Noteholders in the
form specified in the Indenture.  Copies
of such accountings and/or reports shall be delivered to Barclays at the
following address:

 

	
  Barclays
  Bank PLC

  	
   

  	
   

  
	
  5
  The North Colonnade

  	
   

  	
   

  
	
  Canary
  Wharf

  	
   

  	
   

  
	
  E14
  4BB

  	
   

  	
   

  
	
  e-mail
  address:

  	
   

  	
  bgsoperations@barcap.com

  

 

Each of the foregoing
documents (other than the legal opinions described in (5) above) is covered by
the representation contained in Section 3(d) of this Agreement.

 

Part 4

 

Miscellaneous

 

(1)           Governing Law.  This Agreement will be governed by and construed in accordance
with the laws of the State of New York without reference to choice of law
doctrine.

 

(2)           Notices.

 

(a)           In connection with
Section 12(a), all notices to Barclays shall, with respect to any
particular Transaction, be sent to the address, telex number or facsimile
number specified in the relevant Confirmation and any notice for purposes of
Sections 5 or 6 of the Agreement shall be sent to the address or telex number
specified below:

 

Barclays Bank PLC

Attention:  Swaps Documentation

5 The North Colonnade

Canary Wharf

E14 4BB

Telephone No.: 44 (20) 7773 6810

Facsimile No.:  44 (20) 7773 6461

 

(b)           In connection with
Section 12(a), all notices to the Counterparty shall, with respect to any
particular  Transaction, be sent to the
address, telex number or facsimile number specified in the relevant
Confirmation and any notice for purposes of Sections 5 or 6 of the Agreement
shall be sent to the address or telex number specified below:

 

World Financial Network
Credit Card Master Note Trust

c/o JP Morgan Chase Bank

 

4 New York Plaza

15th Floor

New York, NY  10004

Attention: Institutional Trust Services

Telephone No.:  

Facsimile No.:

 

With a copy to:

 

World Financial Network
National Bank

800 Techcenter Drive

Gahanna, OH 43230

Attention:  Treasurer

Telephone No.:  614-729-4723

Facsimile No.:  614-729-4899

 

(3)           Netting of Payments.  Section 2(c)(ii) of this Agreement will
apply, with the effect that payment netting will not take place with respect to
amounts due and owing in respect of more than one Transaction.

 

(4)           Offices; Multibranch Party.  For purposes of Section 10:

 

(a)           Section 10(a) will
apply; and

 

(b)           For the purpose of
Section 10(c):

 

(i) Barclays is a
Multibranch Party and may act through its London and New York Offices.

 

(ii) The Counterparty is
not a Multibranch Party.

 

(5)           Credit Support Documents.

 

With respect to Barclays,
if applicable, any Third Party Credit Support Document delivered by Barclays
shall constitute a Credit Support Document.

 

With respect to Barclays
and the Counterparty, if applicable, any Approved Credit Support Document shall
constitute a Credit Support Document.

 

(6)           Credit Support Provider.

 

With respect to Barclays,
the party guaranteeing Barclays’s obligations pursuant to a Third Party Credit
Support Document, if any, shall be a Credit Support Provider.

 

(7)           Process Agents.  The Counterparty appoints as its Process Agent for the purpose of
Section 13(c):

 

Not applicable

 

 

Part 5

 

Other Provisions

 

(1)           ISDA Definitions.  Reference is hereby made to the 2000 ISDA Definitions (the “ISDA
Definitions”) each as published by the International Swaps and Derivatives
Association, Inc., which are hereby incorporated by reference herein.  Any terms used and not otherwise defined
herein which are contained in the ISDA Definitions shall have the meaning set
forth therein.

 

(2)           Confirmation Procedures.  Each party acknowledges and agrees that the
Confirmation executed as of the date hereof and designated as Reference No.
610022B shall be the only Transaction governed by this Agreement (it being
understood that, in the event such Confirmation shall be amended (in any
respect), such amendment shall not constitute (for purposes of this paragraph)
a separate Transaction or a separate Confirmation).  Party A and Party B shall not enter into any additional
Confirmations or Transactions hereunder.

 

(3)           Inconsistency.  In the event of any inconsistency between any of the following
documents, the relevant document first listed below shall govern:  (i) a Confirmation; (ii) the Schedule; (iii)
the ISDA Definitions; and (iv) the printed form of ISDA Master Agreement.

 

(4)           Calculation Agent.  The Calculation Agent will be Barclays.

 

(5)           Waiver of Jury Trial.  Each party waives, to the fullest extent
permitted by applicable law, any right it may have to a trial by jury in
respect of any suit, action or proceeding relating to this Agreement or any
Credit Support Document.  Each party (i)
certifies that no representative, agent or attorney of the other party or any
Credit Support Provider has represented, expressly or otherwise, that such
other party would not, in the event of such a suit, action or proceeding, seek
to enforce the foregoing waiver and (ii) acknowledges that it and the other
party have been induced to enter into this Agreement and provide for any Credit
Support Document, as applicable, by, among other things, the mutual waivers and
certifications in this Section.

 

(6)           Severability.  In the event any one or more of the provisions contained in this
Agreement should be held invalid, illegal, or unenforceable (in whole or in
part) in any respect, the remaining terms, provisions, covenants and conditions
hereof shall continue in full force and effect as if this Agreement had been
executed with the invalid or unenforceable portion eliminated, so long as this
Agreement as so modified continues to express, without material change the
original intentions of the parties as to the subject matter of this Agreement
and the deletion of such portion of this Agreement will not substantially
impair the respective benefits or expectations of the parties to this
Agreement; provided, however, that this severability provision shall not be
applicable if any provision of Section 2, 5, 6 or 13 (or any definition or
provision in Section 14 to the extent it relates to, or is used in or in
connection with any such Section) shall be so held to be invalid or
unenforceable.

 

(7)           No Gross-up for Counterparty.  Section 2(d) of the Agreement shall not
apply with respect to the Counterparty so that the Counterparty shall not be
obligated to gross up pursuant thereto.

 

(8)           Barclays Acknowledgment.  Notwithstanding anything to the contrary in
this Agreement, Barclays hereby

 

(a) acknowledges and
agrees that the Counterparty has pledged its rights under this Agreement to the
Trustee pursuant to the Indenture and that in the event of an Event of Default
(as defined in the 

 

 

Indenture) the Trustee
shall be entitled to exercise all rights and remedies of a secured party with
respect to this Agreement; and

 

(b) agrees that, unless
notified in writing by the Trustee of other payment instructions, any and all
amounts payable by Barclays to the Counterparty shall be paid to the Trustee.

 

(9)           No Petition; Limited Recourse.  Barclays hereby agrees that it shall not
institute against, or join any other Person in instituting against the
Counterparty any bankruptcy, reorganization, arrangement, insolvency,
moratorium or liquidation proceedings or other proceedings under U.S. federal
or state or other bankruptcy or similar laws. 
Notwithstanding the foregoing, nothing herein shall prevent Barclays
from participating in any such proceeding once commenced.

 

Barclays hereby
acknowledges and agrees that the Counterparty’s obligations hereunder will be
solely the limited recourse obligations of the Counterparty, and that Barclays
will not have any recourse to any of the directors, officers, employees,
shareholders or affiliates of the Counterparty with respect to any claims,
losses, damages, liabilities, indemnities or other obligations in connection
with any transactions contemplated hereby. 
Notwithstanding any other provisions hereof, recourse in respect of any
obligations of the Counterparty to Barclays hereunder or thereunder will be
limited to the Collateral, subject to and in accordance with the terms of the
priority of payments set forth in Section 4.4 of the Indenture Supplement,
and on the exhaustion thereof all claims against the Counterparty arising from
this Agreement or any other transactions contemplated hereby or thereby shall
be extinguished.

 

(10)         Ratings Downgrade Provisions.  Unless written notification to the contrary
has been received from the Rating Agencies, following the occurrence of a
Ratings Event I and/or a Ratings Event II, the parties shall comply with the
following provisions, as applicable.

 

I.         If a Ratings Event I
shall occur and be continuing with respect to Barclays, then Barclays shall,
within 5 Local Business Days of the occurrence of such Ratings Event I, give
notice of the occurrence of such Ratings Event I to Counterparty.  Following such notice, Barclays may either

 

(A) at its sole option
and expense, provide, or cause to be provided, a Third Party Credit Support
Document to Counterparty; or

 

(B) at its sole option
and expense, use reasonable efforts to transfer Barclays’ rights and
obligations under the Agreement and all Confirmations to another party.

 

Each of I(A) and I(B)
above shall be subject to satisfaction of the Rating Agency Condition.

 

If, on or prior to the
date that is 30 calendar days after the occurrence of a Ratings Event I,
Barclays has provided a Third Party Credit Support Document as provided in I(A)
above and the Rating Agency Condition has been satisfied, then, for so long as
such Third Party Credit Support Document is in effect and the Rating Agency
Condition continues to be satisfied, Barclays shall have no further obligations
in respect of this Part 5(10)(I).

 

If,

 

(i) on or prior to the
date that is 30 calendar days after the occurrence of a Ratings Event I,
Barclays has not provided a Third Party Credit Support Document as provided in
I(A) above or transferred its rights and obligations as provided in I(B) above,
or

 

 

(ii) Barclays has provided
a Third Party Credit Support Document as provided in I(A) above but such Third
Party Credit Support Document has ceased to be in effect and/or the Rating
Agency Condition is no longer satisfied,

 

then, on the first Local
Business Day following the date that is 30 calendar days after the occurrence
of the Ratings Event I (in respect of (i) above) or on the first Local Business
Day following the date on which the Third Party Credit Support Document
referred to in (ii) above has ceased to be in effect and/or fails to satisfy
the Rating Agency Condition, Counterparty may demand that Barclays deliver
Eligible Collateral to Counterparty in accordance with the terms of an Approved
Credit Support Document.  Notwithstanding
the foregoing, Barclays’ obligations under this Part 5(10)(I) to post Eligible
Collateral under the Approved Credit Support Document shall remain in effect
only for so long as a Ratings Event I is continuing with respect to Barclays.

 

The failure by Barclays
to comply with the provisions hereof shall constitute an Additional Termination
Event, with Barclays as the sole Affected Party and all Transactions then
outstanding between the parties as Affected Transactions.

 

II.       If a Ratings Event II shall
occur and be continuing with respect to Barclays, then Barclays shall, within 5
Local Business Days of the occurrence of such Ratings Event II, give notice of
the occurrence of such Ratings Event II to Counterparty.  Following such notice, Barclays shall either

 

(A) to the extent that is
has not already done so in accordance with Part 5(10)(I), at its sole option
and expense, provide, or cause to be provided, a Third Party Credit Support
Document to Counterparty; or

 

(B) at its sole option
and expense, use reasonable efforts to transfer Barclays’ rights and
obligations under the Agreement and all Confirmations to another party.

 

Each of II(A) and II(B)
above shall be subject to satisfaction of the Rating Agency Condition.

 

If, on or prior to the
date that is 30 calendar days after the occurrence of a Ratings Event II,
Barclays has provided a Third Party Credit Support Document as provided in
II(A) or I(A) above and the Rating Agency Condition has been satisfied, then,
for so long as such Third Party Credit Support Document is in effect and the
Rating Agency Condition continues to be satisfied, then, (i) Barclays shall
have no further obligations in respect of this Part 5(10)(II) and, (ii) if
Barclays was delivering Eligible Collateral to Counterparty in accordance with
the terms of an Approved Credit Support Document pursuant to the provisions of
Part 5(10)(I) hereof, Barclays shall have no further obligations to deliver
Eligible Collateral under the Approved Credit Support Document.

 

If,

 

(i) on or prior to the
date that is 30 calendar days after the occurrence of a Ratings Event II,
Barclays has not provided a Third Party Credit Support Document as provided in
II(A) above or transferred its rights and obligations as provided in II(B)
above, or

 

(ii) Barclays has
provided a Third Party Credit Support Document as provided in II(A) or I(A)
above but such Third Party Credit Support Document has ceased to be in effect
and/or the Rating Agency Condition is no longer satisfied,

 

then, on the first Local
Business Day following the date that is 30 calendar days after the occurrence
of the Ratings Event II (in respect of (i) above) or on the first Local
Business Day following the 

 

 

date on which the Third
Party Credit Support Document referred to in (ii) above has ceased to be in
effect and/or fails to satisfy the Rating Agency Condition, and only to the
extent that Barclays is not already delivering Eligible Collateral to
Counterparty in accordance with the terms of an Approved Credit Support
Document pursuant to the provisions of Part 5(10)(I) hereof, Barclays will
deliver Eligible Collateral to Counterparty in accordance with the terms of an
Approved Credit Support Document. 
Concurrently with such delivery of Eligible Collateral, Barclays shall
cause its outside counsel to deliver to Counterparty an opinion as to the
enforceability of Counterparty’s security interest in such Eligible Collateral
in all relevant jurisdictions, if necessary to satisfy the Rating Agency
Condition.  Notwithstanding Barclays’
posting of Eligible Collateral in accordance with the terms of the Approved
Credit Support Document, Barclays shall use best efforts to either transfer its
rights and obligations to an acceptable third party or to provide a Third Party
Credit Support Document.  Notwithstanding
the foregoing, Barclays’ obligations under this Part 5(10)(II) to find a
transferee or provide a Third Party Credit Support Document and to post
Eligible Collateral under the Approved Credit Support Document shall remain in
effect only for so long as a Ratings Event II is continuing with respect to
Barclays.

 

The failure by Barclays
to comply with the provisions hereof shall constitute an Additional Termination
Event, with Barclays as the sole Affected Party and all Transactions then
outstanding between the parties as Affected Transactions.

 

As used herein:

 

“Approved Credit Support
Document” means a security agreement in the form of the 1994 ISDA Credit
Support Annex (ISDA Agreements Subject to New York Law Only), as modified by
the Paragraph 13 thereto, which Paragraph 13 will be in the form of Annex A to
this Agreement;

 

“Indenture” means the
Master Indenture dated as of August 1, 2001, between World Financial
Network Credit Card Master Note Trust, as Issuer, and BNY Midwest Trust
Company, as Indenture Trustee, as supplemented by the Series 2004-C Indenture
Supplement dated as of September 22, 2004, between World Financial Network
Credit Card Master Note Trust, as the Issuer, and BNY Midwest Trust Company, as
the Indenture Trustee (the “Indenture Supplement”), in each case, as amended,
modified, supplemented, restated or replaced from time to time.

 

“Moody’s” means Moody’s
Investors Service, Inc. or any successor thereto;

 

“Rating Agencies” means
S&P and Moody’s;

 

“Rating Agency Condition”
has the meaning specified in the Indenture;

 

“Ratings Event I” shall
occur with respect to Barclays (to the extent that Barclays’s relevant
obligations are rated by Moody’s) if Barclays’ long-term senior unsecured debt
rating by Moody’s is lower than A1 or is A1 on negative watch or Barclays’
short-term senior unsecured debt rating by Moody’s is lower than P-1 or is P-1
on negative watch;

 

“Ratings Event II” shall
occur with respect to Barclays (to the extent that Barclays’ relevant
obligations are rated by S&P and/or Moody’s) if (a) Barclays’ short-term
senior unsecured debt rating by S&P is lower than A-1 or (b) Barclays’
long-term senior unsecured debt rating by Moody’s is A3 or lower or Barclays’
short-term senior unsecured debt rating by Moody’s is P-2 or lower;

 

“S&P” means by
Standard & Poor’s Ratings Service or any successor thereto; and

 

 

“Third Party Credit
Support Document” means any agreement or instrument (including any guarantee,
insurance policy, security agreement or pledge agreement) whose terms provide
for the guarantee of Barclays’ obligations under this Agreement by a third
party.

 

(11)         Additional Representations.  Section 3 is hereby amended by adding
at the end thereof the following paragraphs:

 

“(g)  It is an “eligible contract participant”
under, and as defined in, Section 1a(12) of the Commodity Exchange Act, as
amended.

 

(h) Each party will be
deemed to represent to the other party on the date on which it enters into a
Transaction that (absent a written agreement between the parties that expressly
imposes affirmative obligations to the contrary for that Transaction):

 

(i)            Non-Reliance.  It is acting for its own account, and it has
made its own independent decisions to enter into that Transaction and as to
whether that Transaction is appropriate or proper for it based upon its own
judgment and upon advice from such advisers as it has deemed necessary.  It is not relying on any communication
(written or oral) of the other party as investment advice or as a
recommendation to enter into that Transaction; it being understood that
information and explanations related to the terms and conditions of a
Transaction shall not be considered investment advice or a recommendation to
enter into that Transaction.  No
communication (written or oral) received from the other party shall be deemed
to be an assurance or guarantee as to the expected results of that Transaction.

 

(ii)           Assessment and Understanding.  It is capable of assessing the merits of and
understanding (on its own behalf or through independent professional advice),
and understands and accepts, the terms, conditions and risks of that
Transaction.  It is also capable of
assuming, and assumes, the risks of that Transaction.

 

(iii)          Status of Parties.  The other party is not acting as a fiduciary
for or an adviser to it in respect of that Transaction.”

 

(12)         Amendment to Section 7 of the Agreement.  Section 7 of the Agreement is hereby
amended by:

 

(i) adding the words “and
the confirmation of the Rating Agencies” immediately following the word “party”
in the third line thereof; and

 

(ii) adding the following
sentence immediately following the final sentence thereof:

 

“In addition, no transfer
shall be effective unless it satisfies the Rating Agency Condition.”.

 

(13)         Events of Default.  Section 5(a)(i) of the Agreement is amended by substituting the
following therefor:  “Failure by the
party to make, when due, any payment under this Agreement or delivery under
Section 2(a)(i) or 2(e) required to be made by it if such failure is not
remedied on or before the fifth Local Business Day after notice of such failure
is given to the party.”

 

(14)         Owner Trustee.  It is expressly understood and agreed by the parties hereto that
(a) this Agreement is executed and delivered by Chase Manhattan Bank USA,
National Association, not individually or personally but solely as trustee of
the Counterparty in the exercise of the powers 

 

 

and authority conferred
and vested in it under the Amended and Restated Trust Agreement (as defined in
the Indenture), (b) each of the representations, undertakings and agreements herein
made on the part of the Counterparty are made and intended not as personal
representations, undertakings and agreements by Chase Manhattan Bank USA,
National Association, but are made and intended for the purpose of binding only
the Counterparty, and (c) under no circumstances shall Chase Manhattan Bank
USA, National Association be personally liable for the payment of any
indebtedness or expenses of the Counterparty or be liable for the breach or
failure of any obligation, representations, warranty or covenant made or
undertaken by the Counterparty under this Agreement.

 

(15)         Amendment to Section 9(b) of the Agreement.  Section 9(b) of the Agreement is
amended by adding the following sentence immediately following the end of the
first sentence thereof:

 

“In addition, no
amendment modification or waiver in respect of this Agreement will be effective
unless it satisfied the Rating Agency Condition.”

 

(16)         Amendment to
Section 6(e) of the Agreement. 
Section 6(e) of the Agreement is amended by deleting the last
sentence of the introductory paragraph thereof.

 

(17)         The parties agree that
there will be no Set-off with respect to this Agreement.

 

 

Please confirm your
agreement to the terms of the foregoing Schedule by signing below.

 

	
   

  	
   

  	
  BARCLAYS BANK PLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Justin Wray

  
	
   

  	
   

  	
   

  	
  Name:  Justin Wray

  
	
   

  	
   

  	
   

  	
  Title:  Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WORLD FINANCIAL NETWORK CREDIT CARD 

  MASTER NOTE TRUST

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:  Chase Manhattan Bank USA, National
  Association, not in its individual capacity, but solely as Owner Trustee

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:  

  	
  /s/ John J. Cashin

  
	
   

  	
   

  	
   

  	
  Name:  John J. Cashin

  
	
   

  	
   

  	
   

  	
  Title:  Vice President

  

 

2004-C

CLASS B SWAP

 

 

ANNEX A

 

PARAGRAPH 13 TO

CREDIT SUPPORT ANNEX

 

to the
Schedule to the

Master Agreement

 

dated as of
September 22, 2004

 

between

 

	
  Barclays
  Bank PLC

  (“Barclays”)

  	
  and

  	
  WORLD
  FINANCIAL NETWORK CREDIT 

  CARD MASTER NOTE TRUST

  (“Counterparty”)

  

 

Paragraph 13. Elections
and Variables

 

(a)           Security Interest for
“Obligations”.  The term “Obligations”
as used in this Annex includes no additional obligations with respect to either
party.

 

(b)           Credit Support
Obligations.

 

(i)            Delivery Amount,
Return Amount and Credit Support Amount.

 

(A)          “Delivery Amount” has
the meaning specified in Paragraph 3(a) , except that the words “upon a demand
made by the Secured Party” shall be deleted and the word “that” on the second
line of Paragraph 3(a) shall be replaced with the word “a”.

 

(B)           “Return Amount” has the
meaning specified in Paragraph 3(b).

 

(C)           “Credit Support Amount”
shall not have the meaning specified in Paragraph 3(b) and, instead, will have
the following meaning:

 

“Credit Support Amount”
means, for any Valuation Date, (i) the Secured Party’s Modified Exposure for
that Valuation Date minus (ii) the Pledgor’s Threshold; provided, however,
that the Credit Support Amount will be deemed to be zero whenever the
calculation of Credit Support Amount yields a number less than zero.

 

(ii)           Eligible
Collateral.  The following items will
qualify as “Eligible Collateral”:

 

	
   

  	
   

  	
   

  	
   

  	
  Barclays

  	
   

  	
  “Valuation Percentage”

  
	
  (A)

  	
   

  	
  USD Cash

  	
   

  	
  X

  	
   

  	
  100%

  
	
  (B)

  	
   

  	
  Negotiable debt
  obligations issued by the U.S. Treasury Department having a remaining
  maturity of one year or less from the Valuation Date

  	
   

  	
  X

  	
   

  	
  98.9%

  

 

 

	
  (C)

  	
   

  	
  Negotiable debt
  obligations issued by the U.S. Treasury Department having a remaining
  maturity of more than one year but less than ten years from the Valuation
  Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  
	
  (D)

  	
   

  	
  Negotiable debt
  obligations issued by the U.S. Treasury Department having a remaining
  maturity of ten years or more from the Valuation Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  
	
  (E)

  	
   

  	
  Agency Securities
  having a remaining maturity of one year or less from the Valuation Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  
	
  (F)

  	
   

  	
  Agency Securities
  having a remaining maturity of more than one year but less than ten years
  from the Valuation Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  
	
  (G)

  	
   

  	
  Agency Securities
  having a remaining maturity of ten years or more from the Valuation Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  
	
  (H)

  	
   

  	
  USD denominated
  Commercial Paper rated A1/P1 by S&P and Moody’s respectively, that (a)
  settles within DTC, (b) is not issued by Barclays or any of its Affiliates
  and (c) has a remaining maturity of 30 days or less from the Valuation Date

  	
   

  	
  X

  	
   

  	
  To be determined
  and subject to the prior written consent of Moody’s and S&P

  

 

For purposes of the
foregoing:

 

 

(a) “Agency Securities”
means negotiable debt obligations which are fully guaranteed as to both
principal and interest by the Federal National Mortgage Association, the
Government National Mortgage Association or the Federal Home Loan Mortgage
Corporation, but excluding (i) interest only and principal only securities and
(ii) Collateralized Mortgage Obligations, Real Estate Mortgage Investment
Conduits and similar derivative securities.

 

(b) “DTC” shall mean The
Depository Trust & Clearing Corporation, or its successor.

 

(c) “Moody’s” shall mean
Moody’s Investors Service, Inc., or its successor.

 

(d) “S&P” shall mean
Standard & Poor’s Ratings Group, or its successor.

 

(e) Eligible Collateral
of the type described in Paragraph 13(b)(ii)(H) may never constitute more than
20% of the total Value of Posted Collateral.

 

(f) With respect to
Posted Collateral consisting of Eligible Collateral of the type described in
Paragraph 13(b)(ii)(H), the aggregate Value of such Posted Collateral issued by
the same issuer may never be greater than 33% of the aggregate Value of all
Posted Collateral consisting of Eligible Collateral of the type described in
Paragraph 13(b)(ii)(H).

 

(iii)          Other Eligible
Support.  There shall be no “Other
Eligible Support” for purposes of this Annex, unless (A) agreed in writing
between the parties and (B) upon the prior written consent of Moody’s and
S&P.

 

(iv)          Thresholds.

 

(A)          “Independent Amount”
means zero.

 

(B)           “Threshold” shall not
apply with respect to the Counterparty and, with respect to Barclays, shall
mean the amounts determined on the basis of the lower of the Credit Ratings set
forth in the following table, provided, however, that if (i)
Barclays has no Credit Rating, or (ii) an Event of Default has occurred and is
continuing with respect to Barclays, Barclays’ Threshold shall be U.S.$0:

 

	
  CREDIT RATING

  (S&P /Moody’s)

  	
   

  	
  THRESHOLD 

  Barclays

  
	
   

  	
   

  	
   

  
	
  S&P:
  A-1 or above; and

  	
   

  	
  Infinity

  
	
   

  	
   

  	
   

  
	
  Moody’s
  (long-term senior unsecured debt of Barclays): A1 or above; and

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Moody’s
  (short-term senior unsecured debt of Barclays): P-1 or above.

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  S&P:
  Below A-1;or

  	
   

  	
  US$0

  
	
   

  	
   

  	
   

  
	
  Moody’s
  (long-term senior unsecured debt of Barclays): Below A1 or A1 on negative
  watch; or

  	
   

  	
   

  

 

 

	
  Moody’s (short-term senior unsecured debt of Barclays): Below P-1 or
  P-1 on negative watch.

  	
   

  	
   

  

 

As used herein:

 

“Credit Rating” means,
with respect to (a) S&P, the rating assigned by S&P to the short-term
senior unsecured debt of Barclays, and (b) Moody’s, the rating assigned by
Moody’s to the long-term senior unsecured debt of Barclays or to the short-term
senior unsecured debt of Barclays, as applicable.

 

(C)           “Minimum Transfer
Amount”, with respect to a party on any Valuation Date, means U.S. $100,000.

 

Rounding.  The Delivery Amount and the Return Amount
will be rounded up and down to the nearest integral multiple of $10,000,
respectively.

 

(c)           Valuation and Timing.

 

(i)            “Valuation Agent”
means Barclays, unless an Event of Default with respect to Barclays is
continuing, in which case “Valuation Agent” shall mean the Counterparty or a
financial institution selected by the Counterparty in its reasonable
discretion.

 

(ii)           “Valuation Date” means
weekly on the last Local Business Day of each week or more frequently if agreed
in writing by the parties.

 

(iii)          “Valuation Time” means
the close of business in the city of the Valuation Agent on the Valuation Date
or date of calculation, as applicable.

 

(iv)          “Notification Time”
means 12:00 p.m., New York time, on a Local Business Day.

 

(d)           Conditions Precedent.  With respect to Barclays, any Additional
Termination Event (if Barclays is the Affected Party with respect to such
Termination Event) will be a “Specified Condition”.

 

(e)           Substitution.

 

(i)            “Substitution Date”
has the meaning specified in Paragraph 4(d)(ii).

 

(ii)           Consent.  Inapplicable.

 

(f)            Dispute Resolution.

 

(i)            “Resolution Time”
means 1:00 p.m., New York time, on the Local Business Day following the date on
which the notice is given that gives rise to a dispute under Paragraph 5.

 

(ii)           Value.   For the purposes of Paragraphs 5(i)(C) and
5(ii), the Value of Posted Credit Support other than Cash will be calculated as
follows:

 

 

(A)          with respect to any
Eligible Collateral except Cash, the sum of (I) (x) the mean of the high bid
and low asked prices quoted on such date by any principal market maker for such
Eligible Collateral chosen by the Disputing Party, or (y) if no quotations are
available from a principal market maker for such date, the mean of such high
bid and low asked prices as of the first day prior to such date on which such
quotations were available, plus (II) the accrued interest on such Eligible
Collateral (except to the extent Transferred to a party pursuant to any
applicable provision of this Agreement or included in the applicable price
referred to in (I) of this clause (A)) as of such date; multiplied by the
applicable Valuation Percentage.

 

(iii)          Alternative.  The provisions of Paragraph 5 will apply.

 

(g)           Holding and Using
Posted Collateral.

 

(i)            Eligibility to Hold
Posted Collateral; Custodians. 
Counterparty and its Custodian will be entitled to hold Posted
Collateral pursuant to Paragraph 6(b); provided that the following conditions
applicable to it are satisfied:

 

(1)           Counterparty is not a
Defaulting Party and

 

(2)           Posted Collateral may
be held only in the following jurisdictions:

 

New
York State.

 

Initially, the Custodian
for Counterparty is: Chase Manhattan Bank USA, National Association.

 

(ii)           Use of Posted
Collateral.  The provisions of Paragraph
6(c)(i) will not apply to Counterparty but the provisions of Paragraph 6(c)(ii)
will apply to the Counterparty; provided, however, that the Counterparty shall
invest, or cause to be invested, Posted Collateral in the form of Cash in such
Eligible Investments (as defined in the Indenture) as designated by
Barclays.  The Counterparty is
authorized to liquidate any Posted Credit Support pursuant to written
instructions from Barclays.

 

(iii)          Holding Collateral.  The Secured Party shall cause any Custodian
appointed hereunder to open and maintain a segregated account and to hold,
record and identify all the Posted Collateral in such segregated account and,
subject to Paragraphs 6(c) and 8(a), such Posted Collateral shall at all times
be and remain the property of the Pledgor and shall at not time constitute the
property of, or be commingled with the property of, the Secured Party or the
Custodian.

 

(h)           Distributions and
Interest Amount.

 

(i)            Interest Rate.  Not Applicable.

 

(ii)           Transfer of Interest
Amount.  The Transfer of the Interest
Amount will be made monthly on the second Local Business Day of each calendar
month.

 

(iii)          Alternative to Interest
Amount.  The provisions of Paragraph
6(d)(ii) will not apply and, instead, the Interest Amount payable by the
Counterparty specified in subparagraph (h)(ii) 

 

 

 

will be the amount of
actual cash earnings on Posted Collateral in the form of Cash during the
relevant Interest Period.

 

(i)            Additional
Representation(s).  Not Applicable.

 

(j)            Other Eligible Support
and Other Posted Support.

 

(i)            “Value” with respect
to Other Eligible Support and Other Posted Support means: Not Applicable.

 

(ii)           “Transfer” with respect
to Other Eligible Support and Other Posted Support means: Not Applicable

 

(k)           Demands and Notices.

 

All demands,
specifications and notices under this Annex will be made pursuant to the
Notices Section of this Agreement, unless otherwise specified here: N/A

 

Counterparty:

 

 

 

Barclays:

 

	
  For
  cash:

  	
   

  	
  For
  Treasury Securities:

  
	
   

  	
   

  	
   

  
	
  Barclays
  Bank PLC, NY

  	
   

  	
  Bank
  of NYC/BBPLCLDN ABA

  
	
  ABA
  #026-002-574

  	
   

  	
   

  
	
  F/O:
  Barclays Swaps & Options

  	
   

  	
   

  
	
  Group NY

  	
   

  	
   

  
	
  A/C
  #: 050019228

  	
   

  	
   

  
	
  Ref:
  Collateral

  	
   

  	
   

  

 

(l)            Addresses for
Transfers.

 

Counterparty: as set
forth in notices to Barclays from time to time

 

Barclays:

 

(m)          Other Provisions:

 

(i)            Modification to
Paragraph 1: The following subparagraph (b) is substituted for subparagraph
(b) of this Annex:

 

 

(b) Secured Party and Pledgor.  All references in this Annex to the “Secured
Party” will be to Counterparty and all corresponding references to the
“Pledgor” will be to Barclays.

 

(ii)           Modification to
Paragraph 2:  The following
Paragraph 2 is substituted for Paragraph 2 of this Annex:

 

Paragraph 2.  Security Interest.  The Pledgor hereby pledges to the Secured
Party, as security for its Obligations, and grants to the Secured Party a first
priority continuing security interest in and lien on against all Posted
Collateral Transferred to or received by the Secured Party hereunder.  Upon the Transfer by the Secured Party to
the Pledgor of Posted Collateral, the security interest and lien granted
hereunder on that Posted Collateral will be released immediately and, to the
extent possible, without any further action by either party.

 

(iii)          Modification to
Paragraph 8(a):  Paragraph 8(a) is
modified by deleting the text of clause (iii) thereof and replacing such text
with the word “Reserved”.

 

(iv)          Modification to
Paragraph 8(b)(iv):  Paragraph
8(b)(iv) is modified and restated in its entirety to read as follows:

 

“(iv) to the extent that
Posted Collateral or the Interest Amount is not so Transferred pursuant to
(iii) above, the Pledgor may withhold payment of any remaining amounts payable
by the Pledgor with respect to any Obligations, up to the Value of any
remaining Posted Collateral held by the Secured Party, until that Posted Collateral
is Transferred to the Pledgor.”

 

(v)           Modification to
Paragraph 8(c):  Paragraph 8(c) is
modified and restated in its entirety to read as follows:

 

“(c)         Deficiencies and Excess Proceeds.  The Secured Party will Transfer to the
Pledgor any proceeds and Posted Credit Support remaining after liquidation
and/or application under Paragraphs 8(a) and 8(b) after satisfaction in full of
all amounts payable by the Pledgor with respect to any Obligations; the Pledgor
in all events will remain liable for any amounts remaining unpaid after any
liquidation and/or application under Paragraphs 8(a) and 8(b).”

 

(vi)          Modification to
Paragraph 9:  The following first
clause of Paragraph 9 is substituted for the first clause of Paragraph 9 of
this Annex:

 

Paragraph 9.  Representations.  The Pledgor represents to the Secured Party
(which representations will be deemed to be repeated as of each date on which
it Transfers Eligible Collateral) that:

 

(vii)         Modifications to
Paragraph 12:  The following
definitions of “Pledgor” and “Secured Party” are substituted for the
definitions of those terms contained in Paragraph 12 of this Annex:

 

“Pledgor” means Barclays,
when that party (i) is required to Transfer Eligible Credit Support under
Paragraph 3(a) or (ii) has Transferred Eligible Credit Support under Paragraph
3(a).

 

 

“Secured Party” means
Counterparty, when that party (i) is entitled to receive Eligible Credit
Support under Paragraph 3(a) or (ii) holds or is deemed to hold Posted Credit
Support.

 

(viii)        Addition to Paragraph
12:  The following definitions of
“Modified Exposure” shall be added immediately after the definition of the term
“Minimum Transfer Amount” and immediately prior to the definition of the term
“Notification Time” in Paragraph 12 of this Annex:

 

“Modified Exposure”
means, for any Valuation Date, an amount equal to the greater of (i) the sum of
the Secured Party’s Exposure for that Valuation Date and the Volatility Buffer,
and (ii) the amount of the next scheduled payment that is required to be made by
Barclays pursuant to the Transaction. 
As used herein:

 

“Volatility Buffer”
means, with respect to the Transaction, an amount equal to the product of (a)
the Factor applicable to the Transaction and (b) the Notional Amount of the
Transaction.

 

“Factor” means, with
respect to the Transaction, a percentage dependent on Barclays’ Counterparty
Rating and the original maturity of the Transaction and determined by the
Valuation Agent by reference to the following table:

 

 

	
  Counterparty Rating

  	
   

  	
  Maturities
  up to 5 years

  (%)

  	
   

  	
  Maturities
  up to 10

  years (%)

  	
   

  	
  Maturities
  up to 30

  years (%)

  	
   

  
	
  A-2/P-2

  	
   

  	
  3.25

  	
   

  	
  4.00

  	
   

  	
  4.75

  	
   

  
	
  A-3/P-3

  	
   

  	
  4.00

  	
   

  	
  5.00

  	
   

  	
  6.25

  	
   

  
	
  BB+/Ba1
  or lower

  	
   

  	
  4.50

  	
   

  	
  6.75

  	
   

  	
  7.50

  	
   

  

 

(ix)           Modification to
Paragraph 12:  Clause “(B)” of the
definition of “Value” will be substituted to read in its entirety as follows:

 

“(B) a security, the bid
price obtained by the Valuation Agent from one of the Pricing Sources
multiplied by the applicable Valuation Percentage, if any;”

 

(x)            Addition to
Paragraph 12:  The following definition
of “Pricing Sources” shall be added immediately after the definition of the
term “Posted Credit Support” and immediately prior to the definition of the
term “Recalculation Date” in Paragraph 12 of this Annex:

 

“Pricing Sources” means
the sources of financial information commonly known as Bloomberg, Bridge
Information Services, Data Resources Inc., Interactive Data Services,
International Securities Market Association, Merrill Lynch Securities Pricing
Service, Muller Data Corporation, Reuters, Wood Gundy, Trepp Pricing, JJ Kenny,
S&P and Telerate.

 

 

(xi)           Expenses.  Notwithstanding Paragraph 10, the Pledgor
will be responsible for, and will reimburse the Secured Party for, all transfer
and other taxes and other costs involved in the transfer of Eligible
Collateral.

 

 

Accepted and Agreed:

 

BARCLAYS BANK PLC

 

 

	
  By:

  	
   

  
	
  Name:

  
	
  Title:

  
	
   

  
	
   

  
	
  WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST

  
	
   

  
	
  By:

  	
  Chase Manhattan Bank
  USA, National

  
	
   

  	
  Association, not in its
  individual capacity, but

  
	
   

  	
  solely as Owner Trustee

  
	
   

  
	
   

  
	
  By:

  	
   

  
	
  Name:

  
	
  Title:

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