Document:

Exhibit 10.1 Agreement and Plan of Merger

Exhibit 10.1

Agreement and Plan of Merger

dated as of

July 16, 2012

among

Cellteck, Inc.,

a Nevada corporation,

Eos Merger Sub,

a Delaware Corporation

and

Eos Petro, Inc.,

a Delaware corporation

AGREEMENT AND PLAN OF MERGER

This AGREEMENT AND PLAN OF MERGER (the “Agreement”) is dated as of July 16, 2012 (the “Execution Date”) among Cellteck, Inc., a Nevada corporation (“Parent”), Eos Merger Sub, a Delaware corporation wholly owned by Parent (“Sub”), and Eos Petro, Inc., a Delaware corporation (the “Company”).

Recitals

A.  The Company has acquired, is developing and intends to further acquire and develop certain oil and gas properties (the “Opportunity”).

B.  The Boards of Directors of Parent, Sub and the Company have each determined that it is advisable and in the best interests of their respective shareholders to consummate, and have approved, the business combination transaction provided for herein that constitutes a tax-free transaction meeting the requirements of Section 368(a) of the United States Internal Revenue Code of 1986, as amended (the “Code”), in which Sub would merge with and into the Company and the Company would become a wholly-owned subsidiary of Parent (the “Merger”).

C.  Parent, Sub, and the Company desire to make certain representations, warranties and agreements in connection with the Merger and also to prescribe various conditions to the Merger.

Agreement

NOW, THEREFORE, in consideration of the mutual covenants and agreements contained herein, and certain other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto covenant and agree as follows:

Section 1.  The Merger.  

1.1  The Merger.  At the Effective Time (as defined in Section 1.2), upon the terms and subject to the conditions of this Agreement, Sub shall be merged with and into the Company in accordance with Subchapter IX of the Delaware General Corporation Law (the “DGCL”).  The Company shall be the surviving corporation in the Merger (the “Surviving Corporation”).  Sub and the Company are sometimes referred to herein as the “Constituent Corporations.”  As a result of the Merger, the outstanding shares of capital stock of the Constituent Corporations shall be converted or cancelled in the manner provided in Section 2.

1.2  Effective Time.  At the Closing (as defined in Section 1.3), a certificate of merger (the “Certificate of Merger”) shall be duly prepared and executed by the Surviving Corporation and thereafter delivered to the Secretary of State of the State of Delaware (the “Secretary of State”) for filing, as provided in Section 251 and 103 of the DGCL, on, or as soon as practicable after, the Closing Date (as defined in Section 1.3).  The Merger shall become effective at the time of the filing of the Certificate of Merger with the Secretary of State (the date and time of such filing being referred to herein as the “Effective Time”).  

1.3  Closing.  The closing of the Merger (the “Closing”) will take place at the offices of

Company’s counsel, Baker & Hostetler LLP, 12100 Wilshire Boulevard, 15th Floor,

 Los Angeles, CA 

90025,

 or at such other place as the parties hereto mutually agree, on a date and at a time to be specified by the parties, which shall in no event be later than 10:00 a.m., local time, on the first business day following (1) satisfaction of the conditions set forth in Sections 5.2 and 6.2, (2) expiration of any applicable waiting period for the Rule 14f-1 statement (including the mailing of such statement) required by Section 6.14, provided that the other closing conditions set forth in Sections 5 and 6 have been satisfied or, if permissible, waived in accordance with this Agreement, or on such other date as the parties hereto mutually agree (the “Closing Date”).  At the Closing there shall be delivered to Parent, Sub and the Company the certificates and other documents and instruments required to be delivered under Sections 5 and 6.

1.4  Certificate of Incorporation and Bylaws of the Surviving Corporation.  At the Effective Time, (i) the Certificate of Incorporation of the Company as in effect immediately prior to the Effective Time shall be the Certificate of Incorporation of the Surviving Corporation until thereafter amended as provided by law and such Certificate of Incorporation, and (ii) the Bylaws of the Company as in effect immediately prior to the Effective Time shall be the Bylaws of the Surviving Corporation until thereafter amended as provided by law, the Certificate of Incorporation of the Surviving Corporation and such Bylaws.

1.5  Directors and Officers of the Parent and the Surviving Corporation.  From and after the Closing Date, the directors and officers of the Parent shall consist of the directors and officers identified by the Company on Exhibit 1.5, and the directors and officers of the Surviving Corporation shall consist of the directors and officers identified by the Company on Exhibit 1.5, in each case, until their successors shall have been duly elected or appointed and qualified or until their earlier death, resignation or removal in accordance with the Parent’s Articles of Incorporation and Bylaws and the Surviving Corporation’s Certificate of Incorporation and Bylaws.

1.6

  Effects of the Merger.  Subject to the foregoing, the effects of the Merger shall be as provided in the applicable provisions of the DGCL.

1.7

  Further Assurances.  Each party hereto will execute such further documents and instruments and take such further actions as may reasonably be requested by one or more of the others to consummate the Merger, to vest the Surviving Corporation with full title to all assets, properties, rights, approvals, immunities and franchises of either of the Constituent Corporations or to effect the other purposes of this Agreement.  

Section 2.  Conversion of Shares.  

2.1  Conversion of Capital Stock.  At the Effective Time, by virtue of the Merger and without any action on the part of the holder thereof:

(a)

Capital Stock of Sub.  Each issued and outstanding share of the common stock, par value $.001 per share, of Sub (“Sub Common Stock”) shall be converted into and become one fully paid and nonassessable share of common stock, par value $.001 per share, of the Surviving Corporation (“Surviving Corporation Common Stock”).  Each certificate representing outstanding shares of Sub Common Stock shall at the Effective Time represent an equal number of shares of Surviving Corporation Common Stock. 

(b)

Cancellation of Treasury Stock and Stock Owned by Parent and Subsidiaries.  All shares of common stock, par value $.001 per share, of the Company (“Company Common Stock”) that are owned by the Company as treasury stock and any shares of Company Common Stock owned by Parent, Sub or any other wholly-owned Subsidiary (as hereinafter defined) of Parent shall be canceled and retired and shall cease to exist and no stock of Parent or other consideration shall be delivered in exchange therefor.  As used in this Agreement, “Subsidiary” means, with respect to any party, any corporation or other organization, whether incorporated or unincorporated, of which more than fifty percent (50%) of either the equity interests in, or the voting control of, such corporation or other organization is, directly or indirectly through Subsidiaries or otherwise, beneficially owned by such party.

 (c)

Conversion of Company Preferred Stock.  Prior to the Effective Time, all shares Series A Preferred Stock of the Company (the “Company Series A Preferred Stock”) issued and outstanding shall be converted into 804,000 shares of Company Common Stock so that, as of the Effective Time, no shares of Company Series A Preferred Stock will be issued and outstanding. Such shares will then be exchanged for shares of Parent’s Series B Preferred Stock as set forth in Section 2.1(d). 

(d)

Exchange Ratio for Company Common Stock.  Each issued and outstanding share of Company Common Stock (other than shares to be canceled in accordance with Section 2. 1(b)) and other than Dissenting Shares (as defined in Section 2.1(e)) shall be converted into the right to receive one (1) (the “Conversion Number”) fully paid and nonassessable share of Series B Preferred Stock, no par value, of Parent (“Parent Series B Preferred Stock”). All such shares of Company Common Stock shall no longer be outstanding and shall automatically be canceled and retired and shall cease to exist, and each holder of a certificate representing any such shares shall cease to have any rights with respect thereto, except the right to receive the shares of Parent Series B Preferred Stock to be issued in consideration therefor, upon the surrender of such certificate in accordance with Section 2.2, without interest. From the Execution Date through the Closing, Parent shall not pay any dividend in, subdivide, combine into a smaller number of shares or issue by reclassification of its shares, any shares of common stock of Parent (“Parent Common Stock”) or any shares of preferred stock of the Parent unless such transaction is specifically contemplated and permitted by another provision of this Agreement. 

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 (e)

Dissenting Shares.  (i)  Notwithstanding any provision of this Agreement to the contrary, each outstanding share of Company Common Stock the holder of which has not voted in favor of the Merger, has perfected such holder’s right to an appraisal of such holder’s shares in accordance with the applicable provisions of the DGCL and has not effectively withdrawn or lost such right to appraisal (a “Dissenting Share”), shall not be converted into or represent a right to receive shares of Parent Series B Preferred Stock pursuant to Section 2.1(d), but the holder thereof shall be entitled only to such rights as are granted by the applicable provisions of the DGCL; provided, however, that any Dissenting Share held by a person at the Effective Time who shall, after the Effective Time, withdraw the demand for appraisal or lose the right of appraisal, in either case pursuant to the DGCL, shall be deemed to be converted into, as of the Effective Time, the right to receive shares of Parent Series B Preferred Stock pursuant to Section 2.1(d).

(ii)  The Company shall give Parent (x) prompt notice of any written demands for appraisal, withdrawals of demands for appraisal and any other instruments served pursuant to the applicable provisions of the DGCL relating to the appraisal process received by the Company and (y) the opportunity to direct all negotiations and proceedings with respect to demands for appraisal under the DGCL.  The Company will not voluntarily make any payment with respect to any demands for appraisal and will not, except with the prior written consent of Parent, settle or offer to settle any such demands.

2.2  Exchange of Certificates.

(a)

Exchange Agent.  On the Closing Date, Parent shall make available to such person designated by the Company and reasonably acceptable to Parent (the “Exchange Agent”), certificates representing the number of duly authorized shares of Parent Series B Preferred Stock issuable in connection with the Merger, to be held for the benefit of and distributed to the holders of Company Common Stock in accordance with this Section.  The Exchange Agent shall agree to hold such shares of Parent Series B Preferred Stock (such shares of Parent Series B Preferred Stock being referred to herein as the “Exchange Fund”) for delivery as contemplated by this Section and upon such additional terms as may be agreed upon by the Exchange Agent, the Company and Parent.  

(b)

Exchange Procedures.  As soon as reasonably practicable after the Effective Time and subject to the surrender provisions of this Section 2.2(b), the Exchange Agent shall deliver to each holder of record of a certificate or certificates which immediately prior to the Effective Time represented outstanding shares of Company Common Stock (the “Certificates”) whose shares are converted pursuant to Section 2.1(c) into the right to receive shares of Parent Series B Preferred Stock a certificate representing that number of shares of Parent Series B Preferred Stock which such holder has the right to receive pursuant to the provisions of this Section 2.  Upon surrender of a Certificate for cancellation to the Exchange Agent, together with such endorsements for transfer duly executed and completed, the holder of such Certificate shall be entitled to receive in exchange therefor a certificate representing that number of shares of Parent Series B Preferred Stock which such holder has the right to receive pursuant to the provisions of this Section 2, and the Certificate so surrendered shall forthwith be canceled.  In no event shall the holder of any Certificate be entitled to receive interest on any property to be received in the Merger.  In the event of a transfer of ownership of Company Common Stock which is not registered in the transfer records of the Company, a certificate representing that number of whole shares of Parent Series B Preferred Stock may be issued to a transferee if the Certificate representing such Company Common Stock is presented to the Exchange Agent accompanied by all documents required to evidence and effect such transfer and by evidence that any applicable stock transfer taxes have been paid.  Until surrendered as contemplated by this Section 2.2(b), each Certificate shall be deemed at any time after the Effective Time for all corporate purposes of Parent, except as limited by paragraph (c) below, to represent ownership of the number of shares of Parent Series B Preferred Stock into which the number of shares of Company Common Stock shown thereon have been converted as contemplated by this Section 2.

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 (c)

Distributions with Respect to Unexchanged Shares.  No dividends or other distributions declared or made after the Effective Time with respect to Parent Series B Preferred Stock with a record date on or after the Effective Time shall be paid to the holder of any unsurrendered Certificate with respect to the shares of Parent Series B Preferred Stock represented thereby until the holder of record of such Certificate shall surrender such Certificate in accordance with this Section.  Subject to the effect of applicable laws, following surrender of any such Certificate, there shall be paid to the record holder of the certificates representing shares of Parent Series B Preferred Stock issued in exchange therefor, without interest, (i) at the time of such surrender, the amount of dividends or other distributions, if any, with a record date on or after the Effective Time which theretofore became payable, but which were not paid by reason of the immediately preceding sentence, with respect to such whole shares of Parent Series B Preferred Stock, and (ii) at the appropriate payment date, the amount of dividends or other distributions with a record date on or after the Effective Time but prior to surrender and a payment date subsequent to surrender payable with respect to such whole shares of Parent Series B Preferred Stock.

(d)

No Further Ownership Rights in Company Common Stock.  All shares of Parent Series B Preferred Stock issued upon the surrender for exchange of Certificates in accordance with the terms hereof (including any cash paid pursuant to Section 2.2(e)) shall be deemed to have been issued at the Effective Time in full satisfaction of all rights pertaining to the shares of Company Common Stock represented thereby, subject, however, to the Surviving Corporation’s obligation to pay any dividends which may have been declared by the Company on such shares of Company Common Stock in accordance with the terms of this Agreement and which remained unpaid at the Effective Time.  From and after the Effective Time, the stock transfer books of the Company shall be closed and there shall be no further registration of transfers on the stock transfer books of the Surviving Corporation of the shares of Company Common Stock which were outstanding immediately prior to the Effective Time.  If, after the Effective Time, Certificates are presented to the Surviving Corporation for any reason, they shall be canceled and exchanged as provided in this Section.

(e)

Fractional Shares.  Parent may issue certificates or scrip representing fractional shares of Parent Common Stock to be issued in the Merger upon the surrender for exchange of Certificates.  

(f)

Termination of Exchange Fund.  Any portion of the Exchange Fund which still remains undistributed to the shareholders of the Company on the three (3) month anniversary of the Effective Time shall be delivered to the Surviving Corporation, upon demand, and any shareholders of the Company who have not theretofore complied with this Section 2 shall thereafter look only to the Surviving Corporation (subject to abandoned property, escheat and other similar laws) as general creditors for payment of their claim for Parent Series B Preferred Stock, any cash in lieu of fractional shares of Parent Series B Preferred Stock and any dividends or distributions with respect to Parent Series B Preferred Stock.  Neither Parent nor the Surviving Corporation shall be liable to any holder of shares of Company Common Stock for shares of Parent Series B Preferred Stock (or dividends or distributions with respect thereto) or cash payable in respect of fractional share interests delivered to a public official pursuant to any applicable abandoned property, escheat or similar law.

2.3  Company Stock Options.

(a)

Conversion of Stock Options. All outstanding Company stock options or other rights to acquire Company common stock (including all commitments to grant stock options, as listed on Schedule 3.6), whether or not then exercisable or vested (each, a “Company Stock Option” and collectively, the “Company Stock Options”), granted under the Company’s plans, agreements and arrangements providing for equity-based compensation to directors, employees, consultants or independent contractors of the Company or its subsidiaries (collectively, the “Company Stock Plans”) shall cease to represent, as of the Effective Time, a right to acquire shares of Company Common Stock or any other security of the Company and shall be converted, in settlement and cancellation thereof, only into the right to receive (upon payment of any exercise price or other required consideration) the number of shares of Parent Common Stock equal to the product of (x) the amount of shares of Company’s Common Stock the holder was entitled to receive upon exercise of the unexercised portion of the Company Stock Options and (y) 800, and from and after the Effective Time, except as provided in this Section 2.3, such holder shall not have any rights or benefits under any Company Stock Plan or Company Stock Option (or any grant or award letter or agreement issued in respect thereof) to acquire any securities of the Company, Parent, the Surviving Corporation or any subsidiary of Parent. 

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 (b)

Cancellation of Plans. Effective as of the Effective Time, the Company Stock Plans shall terminate, and all rights under any provision of the Company Stock Plans providing for the issuance or grant of any other interest with respect to the capital stock or other equity interests of the Company shall be cancelled, without any liability on the part of the Company (except as otherwise expressly provided in this Agreement). 

2.4  Company Warrants. At the Effective Time, the Parent shall duly execute and deliver new warrants (the “Parent Warrants”) to the holders of all issued and outstanding warrants (including all commitments to issue warrants, as listed on Schedule 3.6) of the Company (the “Company Warrants”), so that the holders of all Company Warrants shall have the right to receive, at a total purchase price not to exceed that payable upon the exercise of the unexercised portion of the Company Warrants, an amount of shares of Parent’s Common Stock equal to the product of (x) the amount of shares of Company’s Common Stock the holder was entitled to receive upon exercise of the unexercised portion of the Company Warrants and (y) 800. Parent Warrants shall provide exercise and adjustment provisions that are as nearly equivalent as may be practicable to the provisions of the Company Warrants. At the Effective Time, the Company Warrants shall be canceled and shall cease to exist, and no stock of Parent or any other consideration shall be delivered in exchange therefor.

2.5  Parent Series A.  As soon as the actions required by Section 6.13 have been completed, Parent shall effect the exchange of 100,000 shares of Parent Series B Preferred Stock for all 40,000,000 outstanding shares of Parent’s Series A Preferred Stock (the “Parent Series A Preferred Stock”).

Section 3.  Representations, Warranties and Covenants of the Company.  The Company represents and warrants to, and covenants with, Parent and Sub that, except as set forth in the corresponding section of the Company Disclosure Schedule accompanying this Agreement:

3.1  Corporate Existence, Power and Authority.  The Company is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite corporate power and authority to conduct the Opportunity as now being conducted, and to own, lease or otherwise hold its properties, to enter into this Agreement, and to carry out the transactions contemplated by this Agreement.

3.2  Corporate Action.  The execution and delivery of this Agreement by the Company and the consummation by the Company of the transactions contemplated by this Agreement have been authorized by all requisite corporate action on the part of the Company, except for approval by the Company’s stockholders.

3.3  Validity.  This Agreement constitutes the legal, valid and binding obligation of the Company enforceable in accordance with its terms except as enforcement may be limited by bankruptcy, reorganization, insolvency, moratorium or other similar laws presently or hereafter in effect affecting the enforcement of creditors’ rights generally and subject to general principles of equity.

3.4  Qualification as a Foreign Corporation.  The Company is duly qualified and in good standing as a foreign corporation and licensed to conduct the Opportunity as now being conducted in each jurisdiction in which the Company is required to be qualified to conduct the Opportunity, except where failure to be so qualified, in good standing and licensed would have no material and adverse impact on the ownership of its assets and properties or the conduct of the Opportunity. 

 

3.5  Conflict with Other Instruments.  Neither the execution and delivery of this Agreement by the Company nor the consummation by the Company of the transactions contemplated in this Agreement will (i) conflict with, or result in a breach of, the terms, conditions or provisions of, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or result in the creation of a lien or encumbrance on, or cause the triggering of a “due on sale” clause or similar restriction or provision affecting, any of its assets or properties pursuant to (A) the articles of incorporation or bylaws of the Company or (B) any material indenture, mortgage, lease, agreement or other instrument to which the Company is a party or by which it, or any of its assets or properties, may be bound or affected, or (ii) violate any provision of law, statute, rule or regulation to which the Company is subject or by which it or its properties are bound except where such violation would have no material and adverse impact on the ownership of its assets or properties or the conduct of the Opportunity.

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3.6  Capitalization.  The authorized capital stock of the Company consists of 100,000,000 shares of common stock, par value $.001 per share and 10,000,000 shares of preferred stock, par value $.001 per share

, of which 1,000 shares had been designated as Series A Preferred Stock (the “Company Series A Preferred Stock”)

..  As of the Execution Date, there are

(i)

37,176,044 shares of common stock of the Company issued and outstanding, and

(ii) 268 shares of Company Series A Preferred Stock issued and outstanding.  Prior to or simultaneously with the Effective Time, all shares of Company Series A Preferred Stock issued and outstanding will be converted into 804,000 shares of common stock of the Company, so that, as of the Effective Time, no shares of Company Series A Preferred Stock will be issued and outstanding and all of the issued and outstanding shares of the Company’s common stock will have been duly authorized and validly issued and will be fully paid and nonassessable and free of preemptive rights, totaling 37,980,044 shares of common stock

..  To the Company’s knowledge, there are no voting trusts, shareholder agreements or other voting arrangements, capacities, charges, liens or encumbrances on any shares of the Company

s

tock that have been entered into by the Company Shareholders.  Except as set forth on Schedule 3.6, there is no outstanding subscription, contract, convertible or exchangeable security, option, warrant, call or other right obligating the Company to issue, sell, exchange, or otherwise dispose of, or to purchase, redeem or otherwise acquire, shares of, or securities convertible into or exchangeable for, capital stock of the Company.

3.7  Material Contracts.  The Company has furnished or made available to Parent accurate and complete copies or detailed descriptions of the Company Material Contracts applicable to the Company including the Patents, Licenses and Permits.  With respect to any the Company Material Contract, the Company is not aware of any existing breach, default or event of default by the Company, or event that with notice or lapse of time or both would constitute a breach, default or event of default by the Company, other than breaches, defaults or events of default that would not have a material adverse effect on the business, assets or prospects of the Company (a “Company Material Adverse Effect”), nor does the Company know of, and the Company has not received notice of, or made a claim with respect to, any breach or default by any other party thereto that would, severally or in the aggregate, have a Company Material Adverse Effect.  As used herein, the term “Company Material Contracts” shall mean all (i) employee benefit plans, share option schemes or agreements and employment, consulting or similar contracts, (ii) contracts that involve remaining aggregate payments by the Company in excess of $10,000 or which have a remaining term in excess of two years, (iii) insurance policies, and (iv) all contracts that would, if terminated, have a Company Material Adverse Effect.

3.8  Assets; Title to Assets.  The assets or properties of the Company consist principally of 

the items described in

Schedule 3.8

 (the “Principal Assets”).  The Company has good and marketable title to the Principal Assets, free and clear of all mortgages, liens, claims or encumbrances of any kind or any conditional sale agreement or other title retention agreement.

3.9  Litigation, Etc.  There are no actions, suits, claims investigations

, arbitrations

 or proceedings pending in any court or by or before any governmental agency to which the Company is a party or otherwise affecting the Principal Assets or the Opportunity as now or heretofore conducted by the Company, and, to the best of the Company’s knowledge, after due inquiry, there is no action, suit, claim, investigation, proceeding, grievance or controversy threatened against the Company with regard to or affecting the Principal Assets or the Opportunity as now or heretofore conducted by it.  There is no action, suit, claim, investigation or proceeding known to the Company, after due inquiry, which is pending or threatened which questions the validity or propriety of this Agreement or any action taken or to be taken by the Company in connection with this Agreement.  

T

he Company is not subject to any judicial injunction or mandate or any quasi-judicial order or quasi-judicial restriction directed to or against it as a result of its ownership of the Principal Assets or its conduct of the Opportunity as now or heretofore conducted by it and no governmental agency has at any time challenged or questioned in writing, or commenced or given notice of intention to commence any investigation relating to, the legal right of the Company to conduct the Opportunity or any part thereof as now or heretofore conducted by it, so as to materially and adversely affect the ownership and use of the Principal Assets.

3.10  Compliance with Laws, Etc.  The Company has complied with all laws and regulations of any applicable jurisdiction with which it is or was required to comply in connection with its ownership of the Principal Assets and its conduct of the Opportunity, the enforcement of which would have a material and adverse effect on the ownership of the Principal Assets or the conduct of the Opportunity.  The Company has all permits and permissions of governments, governmental authorities and quasi-governmental authorities necessary to own the Principal Assets and to conduct the Opportunity as now conducted, except where failure to have such permits and permissions would have no material and adverse effect on the ownership of the Principal Assets or the conduct of the Opportunity.

3.11  Governmental Approvals.  No authorization, consent or approval or other order or action of or filing or registration with any court, administrative agency, or other governmental or regulatory body or authority is required for the execution and delivery by the Company of this Agreement or the Company’s consummation of the transactions contemplated hereby.

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3.12  Hazardous Waste.  To the best of the Company’s knowledge, neither the Company nor any previous owner, tenant, occupant or user of any real property now or previously owned or occupied by the Company (“Real Property”) used, generated, manufactured, treated, handled, refined, processed, released, discharged, stored or disposed of any Hazardous Materials (as hereinafter defined) on, under, in or about the Real Property, or transported any Hazardous Materials to or from the Real Property except in accordance with applicable Hazardous Materials Law (as defined herein).  “Hazardous Materials,” as used herein, refers to any flammable materials, explosives, radioactive materials, asbestos, organic compounds known as polychlorinated biphenyls, chemicals now known to cause cancer or reproductive toxicity, pollutants, contaminants, hazardous wastes, toxic substances or related materials, including, without limitation, any substance defined as or included in the definition of “hazardous substances” under the Hazardous Materials Law.  Except for hydrocarbons intended for extraction as part of the Opportunity, no underground tanks or underground deposits of Hazardous Materials exist on, under, in or about the Real Property.

To the best of the Company’s knowledge, the Company has kept and maintained the Real Property, including the groundwater on or under the Real Property, and conducted the Opportunity in compliance with all applicable federal, state and local laws, ordinances or regulations, now or previously in effect, relating to environmental conditions, industrial hygiene or Hazardous Materials on, under, in or about the Real Property including, without limitation, the Comprehensive Environmental Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. Section 8601 et seq., the Resource Conservation and Recovery Act, 42 U.S.C. Section 6401 et seq., the Toxic Substances Control Act, 15 U.S.C. Sections 2601 through 2629, the Safe Drinking Water Act, 42 U.S.C. Sections 300f through 300j, and any similar State or local laws and ordinances and the regulations now or previously adopted, published and/or promulgated pursuant thereto (collectively, the “Hazardous Materials Laws”).

As of the date hereof, there are no (i) enforcement, clean-up, removal, mitigation or other governmental or regulatory actions instituted, contemplated or threatened pursuant to any Hazardous Materials Laws affecting the Real Property, (ii) claims made or threatened by any third party against the Company or the Real Property relating to damage, contribution, cost recovery, compensation, loss or injury resulting from any Hazardous Materials (the matters set forth in clauses (i) and (ii) above are hereinafter referred to as “Hazardous Materials Claims”) nor (iii) any occurrence or condition on the Real Property or adjoining or in the vicinity of the Real Property which could subject the Company, the Parent or the Real Property to any restrictions on ownership, occupancy, transferability or use of the Real Property under any Hazardous Material Laws.

3.13  Patents, Licenses and Permits.  The Principal Assets constitute all patents, licenses, permits, consents, approvals or authorizations of governments, governmental authorities or quasi-governmental authorities (both United States and foreign) currently owned or held by the Company in connection with the Opportunity (the “Patents, Licenses and Permits”), and the Company is the owner or exclusive licensee of each such Patent, License and Permit.  No claims made by third parties with respect to any of the Patents, Licenses and Permits are pending.  There are no decrees, licenses, sublicenses, agreements or limitations now in effect relating to any of the Patents, Licenses and Permits and there has been no notice to the Company that any Patent, License or Permit infringes the rights of any third party or is being infringed by any third party.

3.14  Trademarks, Tradenames, etc.  The Company does not own or use any registered or unregistered copyrights, trademarks, tradenames, service marks, service names, slogans or assumed names (nor are any of the same used or held for use) in connection with the conduct of the Opportunity other than those listed in Schedule 3.14 (the “Trademarks”), all of which are owned by the Company.  No claims made by third parties with respect to any of the Trademarks are pending.  There are no decrees, licenses, sublicenses, agreements or limitations now in effect relating to any of the Trademarks and there has been no notice to the Company that any Trademark infringes the rights of any third party or is being infringed by any third party.

3.15  Books and Records, etc.  Prior to the Closing Date, the Company will make available to Parent copies of all books and records in the Company’s possession relating to the Opportunity and the Principal Assets, and on the Closing Date the Company will deliver to Parent all such books and records in the Company’s possession.

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3.16 Financial Statements. Schedule 3.16 contains a correct and complete copy of (i) the audited consolidated balance sheet of the Company and its consolidated Subsidiaries as at December 31, 2011, together with the Company’s audited consolidated statement of operations and cash flows for the year ended December 31, 2011; and (ii) the unaudited consolidated balance sheet as at June30, 2012, together with the Company’s unaudited consolidated statement of income and cash flows for the six month period ended June 30, 2012 (collectively, the “Company Financial Statements”).  The Financial Statements were prepared in accordance with United States generally accepted accounting principles applied on a consistent basis throughout the periods involved and fairly present in all material respects the consolidated financial position and the consolidated results of operations and cash flows of the Company and its consolidated Subsidiaries, in each case as of the dates and for the periods referred to therein, except as set forth in the notes thereto, and except that the unaudited interim financial statements contained in the Financial Statements do not include footnotes and are subject to normal, recurring year-end audit adjustments.  For avoidance of doubt, the Company Financial Statements shall be delivered prior to Closing as a closing condition, and not on the Execution  Date.

The Company entered into a Purchase and Sale Agreement, dated June 6, 2011 (the “Works Agreement”), with TEHI Illinois, LLC (“TEHI”), a copy of which has been delivered to Parent.  Pursuant to the Works Agreement, the Company acquired TEHI’s rights in and to a lease for The Works, a property located in the Albion Consolidated Field in Edwards County, Illinois.  Since acquiring the rights to The Works lease, the Company has spent $100,000 to reactivate some of the wells located on The Works property.  During the year ended December 31, 2011, the Company had revenues in excess of $31,000.00 and, during the six months ended June 30, 2012, the Company had revenues in excess of $38,000.  As of June 30, 2012, the Company had liabilities not in excess of $1,500,000.00 (excluding legal, accounting and other expenses relating to the transactions contemplated by this Agreement).  As of June 30, 2012, the Company had assets of at least $2,000,000.00 

3.17  Absence of Certain Changes or Events.  Except as disclosed in the Financial Statements, since June 30, 2012 there has been no material adverse change in the condition, financial or otherwise, of the Opportunity or its assets or properties, or in the prospects thereof or therefor

, other than those occurring as a result of general economic or financial conditions or other developments which are not unique to Company but also generally affect other persons who participate or are engaged in the line of business in which Company participates.  Since June 30,

 2012, none of its assets or properties or the Opportunity has been adversely affected in any material way by, or sustained any material loss, whether or not insured, as a result of any fire, flood, accident, explosion, strike, labor disturbance, riot, act of God or the public enemy or other calamity or casualty.  Except as previously disclosed to Parent in writing pursuant to this Agreement and since June 30

,

 2012, the Company (i) has not become involved in any unresolved labor trouble or dispute which materially and adversely affects the Opportunity, (ii) has not become a party to any collective bargaining agreement, and (iii) has not suffered any liability, judgment, lien or termination of contract or the imposition of any obligation, the effect of which shall be materially adverse to the Opportunity or its assets or properties.  Nothing has come to the attention of the President or Chief Financial Officer of the Company which any of such persons believes will cause a material adverse change in the prospects of the Opportunity. 

3.18  Absence of Undisclosed Liabilities. Except for matters reflected or reserved against the balance sheet for the period ended June 30, 2012, t

he Company and its Subsidiaries have

 no liabilities or obligations 

(

whether absolute, accrued, contingent, 

fixed

or otherwise, 

or whether due or to become due) of any nature that would be required by generally accepted accounting principles to be reflected on a consolidated balance sheet of the Company and its consolidated Subsidiaries (including the notes thereto), except liabilities or obligations (i) which were incurred in the ordinary course of business consistent with past practice or in connection with the transactions contemplated by this agreement and (ii) which do not have, and could not reasonably be expected to have, a materially adverse impact on the ownership of the Principal Assets or the conduct of the Opportunity.

3.19  Tax Returns and Tax Liabilities.  The Company has (i) filed all tax returns required to be filed in any jurisdiction to which it is subject, (ii) collected and timely paid over to the taxing authorities of each such jurisdiction all taxes required to be collected by the Company from other persons, such as sales taxes, payroll taxes, etc., (iii) either timely paid in full all taxes due to be paid by it and all taxes claimed to be due and payable from it by each such jurisdiction (except for any such taxes as are being contested in good faith by appropriate proceedings), and any interest, additions to tax and penalties with respect thereto, or provided adequate reserves for the payment thereof, (iv) fully accrued on its books all taxes, and any interest, additions to tax and penalties with respect thereto, for any period through the Execution Date which are not yet due, including such as are being contested, and (v) the amount of any reserves and accruals in respect of taxes is at least equal to the net amount of all taxes and any interest, additions to tax, penalties and deficiency assessments, payable or which in the future become payable by the Company with respect to all periods up to and including the Execution Date.  

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3.20  Officers and Employees.  Schedule 3.20 contains a list of the name of each officer and each full-time employee of the Company employed in the Opportunity at the Execution Date and such person’s position.  Since

May 2, 2011

, there has been no change of, or agreement to change, any terms of employment, including without limitation, salary, wage rates or other compensation, of any officer or employee of the Company employed in the Opportunity.  The Company will use its commercially reasonable best efforts to induce all employees of the Company employed in the Opportunity to continue their respective employment following the Closing Date.  For each employee hired by the Company after January 1, 2011, the Company has verified appropriate documents and has a verified and signed INS Form I-9 for each such employee, if required.  All such forms are in the Company’s possession and shall be turned over to Parent for each employee accepting employment with Parent as of the Closing.  The Company has not received any information that would lead it to believe that a material number of the employees of the Company employed in the Opportunity will or may cease to be employees of the Company, or will refuse offers of employment from Parent, because of the consummation of the transactions contemplated by this Agreement.

3.21 Principal Assets Constitute the Opportunity, etc.  The Principal Assets comprise all of the assets, property, rights and business owned by and employed by the Company in connection with the Opportunity and will enable the Company to operate the Opportunity in substantially the same manner after the Closing as it is being conducted immediately before the Closing.  All of the physical assets are serviceable for the purposes for which they are being used on the Execution Date.

3.22  Material Information.  To the knowledge of the Company, neither the Company Disclosure Schedules hereto nor any other written material provided by the Company to Parent or its accountants, consultants, counsel or other advisers in connection with the negotiation of this Agreement or the transactions contemplated herein, as of their respective dates contained, nor does this Agreement contain, any untrue statement of a material fact or omit to state a material fact necessary to make information contained therein or herein not misleading.  To the knowledge of the Company, there is no fact or condition which the Company has not disclosed to Parent in writing which materially adversely affects the condition, financial or otherwise, of the Principal Assets or the Opportunity or the prospects thereof or therefor, or the ability of the Company to perform any of its obligations under this Agreement.

3.23  No Other Agreements to Sell Assets or Equity Interests.  Other than pursuant to or contemplated by this Agreement, the Company has no legal obligation, absolute or contingent, to any person or firm to sell the Opportunity or the Principal Assets relating to the Opportunity (other than sales in the ordinary course of the Company’s business) or any equity interest therein, or to effect any merger, consolidation or other reorganization of the Company or to enter into any agreement with respect thereto.

3.24  Accredited Investor Status. As of the Execution Date and as of the Effective Time, all Company shareholders are “accredited investors,” as that term is defined in rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”).

Section 4.  Representations and Warranties of Parent and Sub.  Parent and Sub hereby represent and warrant to the Company that, except as set forth in the corresponding section of the Parent Disclosure Schedule accompanying this Agreement:

4.1  Corporate Existence, Power and Authority.  Each of Parent and Sub is a corporation duly organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation and has all requisite corporate power and authority to conduct its business as now being conducted, and to own, lease or otherwise hold its properties, to enter into this Agreement, and to carry out the transactions contemplated by this Agreement.

4.2  Corporate Action.  The execution and delivery of this Agreement by Parent and Sub and the consummation by Parent and Sub of the transactions contemplated by this Agreement have been authorized by all requisite corporate action on the part of Parent and Sub.

4.3  Validity.  This Agreement constitutes the legal, valid and binding obligation of each of Parent and Sub, enforceable in accordance with its terms except as enforcement may be limited by bankruptcy, reorganization, insolvency, moratorium or other similar laws presently or hereafter in effect affecting the enforcement of creditors’ rights generally and subject to general principles of equity.

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4.4  Qualification as a Foreign Corporation.  Each of Parent and Sub is duly qualified and in good standing as a foreign corporation and licensed to conduct its business as now being conducted in each jurisdiction in which Parent or Sub is required to be qualified to conduct its business, except where failure to be so qualified, in good standing and licensed would have no material and adverse impact on the ownership of its assets and properties or the conduct of Parent’s or Sub’s business as now conducted.  

4.5  Conflict with Other Instruments.  Neither the execution and delivery of this Agreement by Parent or Sub nor the consummation by Parent or Sub of the transactions contemplated in this Agreement will (i) conflict with, or result in a breach of, the terms, conditions or provisions of, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or result in the creation of a lien or encumbrance on, or cause the triggering of a “due on sale” clause or similar restriction or provision affecting, any of its assets or properties pursuant to (A) the articles of incorporation or bylaws of Parent or Sub or (B) any material indenture, mortgage, lease, agreement or other instrument to which Parent or Sub is a party or by which it, or any of its assets or properties, may be bound or affected, or (ii) violate any provision of law, statute, rule or regulation to which Parent or Sub is subject or by which it or its properties are bound except where such violation would have no material and adverse impact on the ownership of its assets or properties or the conduct of Parent’s or Sub’s business as now conducted.

4.6  Capitalization.  

(a)

The authorized capital stock of Parent consists solely of 300,000,000 shares of common stock, par value $.0001 per share, and 100,000,000 shares of preferred stock, par value $.0001 per share, of which 40,000,000 shares have been designated as Parent Series A Preferred Stock and 44,000,000 have been designated as Parent Series B Preferred Stock (together with the Parent Series A Preferred Stock, the “Parent Preferred Stock”).  As of the Execution Date, there are 61,633,890 shares of Parent Common Stock and 40,000,000 shares of Parent Series A Preferred Stock issued and outstanding and no shares of Parent Series B Preferred Stock issued and outstanding.  Immediately prior to and as of the Effective Time, there will be 61,633,890 shares of Parent Common Stock and 6,000,000 shares of Parent Series B Preferred Stock issued and outstanding.  All of the issued and outstanding shares of Parent Common Stock and Parent Preferred Stock are, and all shares reserved for issuance will be, upon issuance in accordance with the terms specified in the instruments or agreements pursuant to which they are issuable, duly authorized, validly issued, fully paid and nonassessable.  Except as provided in this Agreement or as contemplated in the Related Transactions, there is no outstanding subscription, contract, convertible or exchangeable security, option, warrant, call or other right obligating Parent to issue, sell, exchange, or otherwise dispose of, or to purchase, redeem or otherwise acquire, shares of, or securities convertible into or exchangeable for, capital stock of Parent.

(b)

To Parent’s knowledge, there are no voting trusts, shareholder agreements or other voting arrangements

, capacities, charges, liens or encumbrances on any shares of Parent stock

 that have been entered into among the shareholders of Parent.

(c)

The Parent Common Stock, upon issuance in accordance with the Merger as provided in this Agreement, will be duly authorized, validly issued, fully paid and nonassessable.

(d)

Except as contemplated in the Related Transactions, there are no outstanding contractual obligations of Parent or any Subsidiary of Parent to repurchase, redeem or otherwise acquire any shares of capital stock or any capital stock of any Subsidiary of Parent or to provide funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in, any Subsidiary of Parent or any other person.

(e)

Attached as Schedule 4.6 is the name of  (i) each person (including any group) who is the beneficial owner of five percent (5%) or more of any class of Parent’s voting securities, (ii) each of Parent’s directors and executive officers, and a description of the beneficial ownership of such securities by each such person,.  For purposes of this Agreement, “beneficial ownership” of a security is determined in accordance with  Rule 13d-3 of the Securities Exchange Act of 1934, as amended,

4.7  Governmental Approvals.  No authorization, consent or approval or other order or action of or filing or registration with any court, administrative agency, or other governmental or regulatory body or authority is required for the execution and delivery by Parent or Sub of this Agreement or Parent’s or Sub’s consummation of the transactions contemplated hereby.

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4.8

Assets; Title to Assets

..  The assets or properties of the Parent consist principally of the items described in

Schedule 4.8

 (the “

Parent Assets

”), and the assets or properties of the Sub consist principally of the items described in

Schedule 4.8

 (the “

Sub Assets

”). Parent has good and marketable title to the Parent Assets, free and clear of all mortgages, liens, claims or encumbrances of any kind or any conditional sale agreement or other title retention agreement. Sub has good and marketable title to the Sub Assets, free and clear of all mortgages, liens, claims or encumbrances of any kind or any conditional sale agreement or other title retention agreement.

4.9

  Litigation.  Except as disclosed in the Parent SEC Reports (as defined in Section 4.11), (i) there are no actions, suits, 

claims investigations,

arbitrations or proceedings pending or, to the 

best

knowledge of Parent

, after due inquiry

, threatened against, relating to or affecting, nor to the 

best

knowledge of Parent

, after due inquiry,

 are there any governmental or regulatory authority investigations or audits pending or threatened against, relating to or affecting, Parent or any of its Subsidiaries or any of their respective assets and properties which, individually or in the aggregate, could be reasonably expected to have a material adverse effect on Parent and its Subsidiaries taken as a whole or on the ability of Parent or Sub to consummate the transactions contemplated by this Agreement, and there are no facts or circumstances known to Parent that could be reasonably expected to give rise to any such action, suit, arbitration, proceeding, investigation or audit, and (ii) neither Parent nor any of its Subsidiaries is subject to any order of any governmental or regulatory authority which, individually or in the aggregate, is having or could be reasonably expected to have a material adverse effect on Parent and its Subsidiaries taken as a whole or on the ability of Parent or Sub to consummate the transactions contemplated by this Agreement.

4.10

  Compliance with Laws, etc.  Each of Parent and Sub has complied with all laws and regulations of any applicable jurisdiction with which it is

 or was

 required to comply, the enforcement of which could materially impair the ability of Parent or Sub to perform its obligations under this Agreement.

4.11

  SEC Reports and Financial Statements.  Parent delivered to the Company prior to the Execution Date, and shall deliver to the Company through the Closing Date, by direction to the SEC’s EDGAR website a true and complete copy of each form, report, schedule, registration statement, definitive proxy statement and other document (together with all amendments thereof and supplements thereto) filed or to be filed by Parent or any of its Subsidiaries with the SEC since December 31, 2008 (as such documents have since the time of their filing been amended or supplemented, the “Parent SEC Reports”), which are all the documents (other than preliminary material) that Parent and its Subsidiaries were required to file with the SEC since such date.  As of their respective dates, the Parent SEC Reports (i) complied as to form in all material respects with the requirements of the Securities Act or the Securities Exchange Act of 1934, as amended (the “Exchange Act”), as the case may be, and (ii) did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.  The audited consolidated financial statements and unaudited interim consolidated financial statements (including, in each case, the notes, if any, thereto) included in the Parent SEC Reports (the “Parent Financial Statements”) complied as to form in all material respects with the published rules and regulations of the SEC with respect thereto, were prepared in accordance with generally accepted accounting principles applied on a consistent basis during the periods involved (except as may be indicated therein or in the notes thereto and except with respect to unaudited statements as permitted by Form 10-Q of the SEC) and fairly present (subject, in the case of the unaudited interim financial statements, to normal, recurring year-end audit adjustments which are not expected to be, individually or in the aggregate, materially adverse to Parent and its Subsidiaries taken as a whole) the consolidated financial position of Parent and its consolidated Subsidiaries as at the respective dates thereof and the consolidated results of their operations and cash flows for the respective periods then ended.  Each Subsidiary of Parent is treated as a consolidated Subsidiary of Parent in the Parent Financial Statements for all periods covered thereby.  The Parent is not a “Shell Company” as defined in Rule 12b-2 of the Securities Exchange Act of 1934.  At all times since at least August 21, 2008, Parent has: (a) been engaged in the business of commercializing the Safe Cell Tab product; (b) pursued a bona fide business strategy to market, sell and distribute the Safe Cell Tab product on a worldwide basis through multiple distribution partners; (c) had a continuing plan of operation that is and has been carried out on a consistent basis; (d) acquired, held and disposed of its assets in a manner that is and has been consistent with its plan of operation; (e) operated continuously and without material interruption or disruption with respect to the Safe Cell Tab business; (f) has made sales of the Safe Cell Tab product; and (g) has generated revenues and made expenditures in connection its operating activities.

4.12

  Absence of Certain Changes or Events.  Except as disclosed in the Parent SEC Reports, (a) since March 31, 2012, there has not been any change, event or development having, or that could be reasonably expected to have, individually or in the aggregate, a material adverse effect on Parent and its Subsidiaries taken as a whole, other than those occurring as a result of general economic or financial conditions or other developments which are not unique to Parent and its Subsidiaries but also generally affect other persons who participate or are engaged in the lines of business in which Parent and its Subsidiaries participate or are engaged and (b) between such date and the Execution Date Parent and its Subsidiaries have conducted their respective businesses only in the ordinary course consistent with past practice or as contemplated in connection with this Agreement.

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4.13

  Absence of Undisclosed Liabilities.  Except for matters reflected or reserved against in the balance sheet for the period ended March 31, 2012, neither Parent nor any of its Subsidiaries had at such date, or has incurred since that date, any liabilities or obligations (whether absolute, accrued, contingent, fixed or otherwise, or whether due or to become due) of any nature that would be required by generally accepted accounting principles to be reflected on a consolidated balance sheet of Parent and its consolidated Subsidiaries (including the notes thereto), except liabilities or obligations (i) which were incurred in the ordinary course of business consistent with past practice or in connection with the transactions contemplated by this Agreement and (ii) which have not been, and could not be reasonably expected to be, individually or in the aggregate, materially adverse to Parent and its Subsidiaries taken as a whole.

4.14

  Tax Returns and Tax Liabilities.  Each of Parent and Sub has (i) filed all tax returns required to be filed in any jurisdiction to which it is subject, (ii) collected and paid over to the taxing authorities of each such jurisdiction all taxes required to be collected by Parent from other persons, such as sales taxes, payroll taxes, etc., (iii) either paid in full all taxes due to be paid by it and all taxes claimed to be due and payable from it by each such jurisdiction (except for any such taxes as are being contested in good faith by appropriate proceedings), and any interest, additions to tax and penalties with respect thereto, or provided adequate reserves for the payment thereof, (iv) fully accrued on its books all taxes, and any interest, additions to tax and penalties with respect thereto, for any period through the Execution Date which are not yet due, including such as are being contested, and (v) the amount of any reserves and accruals in respect of taxes is at least equal to the net amount of all taxes and any interest, additions to tax, penalties and deficiency assessments, payable or which in the future become payable by Parent or Sub with respect to all periods up to and including the Execution Date.  

4.15

  Hazardous Waste.  To the best of Parent’s knowledge, neither Parent or Sub nor any previous owner, tenant, occupant or user of any real property owned, leased or occupied by Parent or Sub used, generated, manufactured, treated, handled, refined, processed, released, discharged, stored or disposed of any Hazardous Materials on, under, in or about such real property, or transported any Hazardous Materials to or from such real property.  No underground tanks or underground deposits of Hazardous Materials exist on, under, in or about such real property.

To the best of Parent’s knowledge, each of Parent and Sub has kept and maintained any real property owned, leased or occupied by Parent or Sub, including the groundwater on or under such real property, and conducted its business in compliance with all applicable federal, state and local laws, ordinances or regulations, now or previously in effect, relating to environmental conditions, industrial hygiene or Hazardous Materials on, under, in or about such real property including, without limitation, the Hazardous Materials Laws.

As of the Execution Date, there are no Hazardous Materials Claims nor has there been any occurrence or condition on any real property owned, leased or occupied by Parent or Sub or adjoining or in the vicinity of such real property which could subject the Company, Parent or Sub or such real property to any restrictions on ownership, occupancy, transferability or use of the Real Property under any Hazardous Material Laws.

4.16

Material Contracts

.. The Parent has furnished or made available to Company accurate and complete copies or detailed descriptions of the Parent or Sub Material Contracts applicable to the Parent or Sub. With respect to any Parent or Sub Material Contract,

each Parent or Sub Material Contract is a valid and binding agreement of Parent or Sub, as applicable, and, to the knowledge of Parent, on each other party thereto, and is in full force and effect, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and similar laws affecting creditors’ rights generally and subject, as to enforceability, to general principles of equity, and

the Parent is not aware of any existing breach, default or event of default by the Parent or Sub, or event that with notice or lapse of time or both would constitute a breach, default or event of default by the Parent or Sub, other than breaches, defaults or events of default that would not have a material adverse effect on the business, assets or prospects of the Parent or Sub (a “

Parent or Sub Material Adverse Effect

”), nor does the Parent know of, and the Parent has not received notice or, or made a claim with respect to any breach or default by any other party thereto that would, severally or in the aggregate, have a Parent or Sub Material Adverse Effect. As used herein, the term “

Parent or Sub Material Contracts

” shall mean (i) all employee benefit plans, share option schemes or agreements and employment, consulting or similar contracts, (ii) contracts that involve remaining aggregate payments by or to

Parent or Sub

 in excess of $10,000 or which have a remaining term in excess of two years, (iii) insurance policies, (iv) the contracts listed on

Schedule 4.16

, and (v) all contracts that would, if terminated, have a Parent or Sub Material Adverse Effect.

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4.17

Patents, Licenses and Permits

.. The Parent Assets and Sub Assets constitute all patents, licenses, permits, consents, approvals or authorizations of governments, governmental authorities or quasi-governmental authorities (both United States and foreign) currently owned or held by the Parent and Sub in connection with the business, assets or prospects of the Parent and Sub (the “

Parent Patents, Licenses and Permits

”), and the Parent or Sub is the owner or exclusive licensee of each Parent Patent, License and Permit. No claims made by third parties with respect to any of the Parent Patents, Licenses and Permits are pending. There are no decrees, licenses, sublicenses, agreements or limitations now in effect relating to any of the Parent Patents, Licenses and Permits and there has been no notice to the Parent or Sub that any of the Parent Patents, Licenses or Permits infringe the rights of any third party or is being infringed by any third party.

4.18

Trademarks, Tradenames, etc

.. The Parent and Sub do not own or use any registered or unregistered copyrights, trademarks, tradenames, service marks, service names, slogans or assumed names (nor are any of the same used or held for use) in connection with the conduct of the Parent and Sub’s business other than those listed in

Schedule 4.18

 (“

Parent Trademarks

”), all of which are owned by the Parent or Sub. No claims made by third parties with respect to any of the Parent Trademarks are pending. There are no decrees, licenses, sublicenses, agreements or limitations now in effect relating to any of the Parent Trademarks and there has been no notice to the Parent or Sub that any Parent Trademark infringes the rights of any third party or is being infringed by any third party.

4.19

Books and Records, etc

..  Prior to the Closing Date, the Parent will make available to Company copies of all books and records in the Parent’s possession relating to the business, assets and prospects of the Parent and Sub, and on the Closing Date the Parent will deliver to Company copies of all such books and records in the Parent’s possession.

4.20

Officers and Employees

..  

(a)

Schedule of Employees

..  

Schedule 4.20(a)

 contains a list of the name of each officer and each full-time employee of the Parent and Sub employed in the business of the Parent or Sub at the Execution Date and such person’s position.  Since December 31, 2010, there has been no change of, or agreement to change, any terms of employment, including without limitation, salary, wage rates or other compensation, of any officer or employee of the Parent or Sub.  

(b)

Employees of Parent and Surviving Corporation

..  The Parent will use its commercially reasonable best efforts to induce all employees identified in

Exhibit 1.5

 to become the officers and directors of the Parent and the Surviving Corporation from and after the Effective Time, as stated in

Exhibit 1.5

..  The Parent has not received any information that would lead it to believe that a material number of the employees of the Parent or Sub identified in

Exhibit 1.5

, may cease or refuse to be employees of the Parent or the Surviving Corporation because of the consummation of the transactions contemplated by this Agreement.  For each employee hired by the Parent after January 1, 2012, the Parent has verified appropriate documents and has a verified and signed INS Form I-9 for each such employee, if required.  All such forms are in the Parent’s possession and shall be turned over to Company for each employee continuing employment with Parent or Surviving Corporation after the Closing.  

4.21

Material Information

..  To the knowledge of Parent, neither the Parent Disclosure Schedule hereto nor any other written material provided by the Parent to Company or its accountants, consultants, counsel or other advisers in connection with the negotiation of this Agreement or the transactions contemplated herein, as of their respective dates contained, nor does this Agreement contain, any untrue statement of a material fact or omit to state a material fact necessary to make information contained therein or herein not misleading. To the knowledge of the Parent, there is no fact or condition which the Parent has not disclosed to Company in writing which materially adversely affects the ability of the Parent or Sub to perform any of their obligations under this Agreement.

4.22

No Other Agreements to Sell Assets or Equity Interests

..  Other than pursuant to or contemplated by this Agreement, the Parent and Sub have no legal obligations, absolute or contingent, to any person or firm to sell the business or assets of the Parent or Sub (other than sales in the ordinary course of business) or any equity interest therein, or to effect any merger, consolidation or other reorganization of the Parent or Sub or to enter into any agreement with respect thereto.

Section 5.  Conditions Precedent to Obligations of Parent and Sub.  All obligations of Parent and Sub under this Agreement to be performed on and after the Closing Date are, at the option of Parent, subject to the satisfaction of the following conditions precedent at the Closing, as indicated below.

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5.1  Proceedings Satisfactory.  All actions, proceedings, instruments, opinions and documents required to carry out this Agreement or incidental hereto, and all other related legal matters, shall be reasonably satisfactory to Parent and to counsel for Parent.  The Company shall have delivered to Parent on the Closing Date such documents and other evidence as Parent may reasonably request in order to establish the consummation of the transactions contemplated by this Agreement, the taking of all corporate and other proceedings in connection therewith and the compliance with the conditions set forth in this Section 5, in form and substance reasonably satisfactory to Parent.

5.2  Shareholder Approval.  This Agreement shall have been adopted by the requisite vote of the shareholders of the Company under the DGCL and the Company’s Certificate of Incorporation, if applicable.  

5.3 Completion and Delivery of Disclosure Schedules. The Company shall have completed and delivered to Parent the Company Disclosure Schedule and all other Company Exhibits and Schedules referenced herein, in form and substance reasonably satisfactory to Parent.  For the avoidance of doubt, the Company is not obligated to supply any of the above-referenced schedules as a condition precedent to the execution of this agreement. 

5.4  Representations and Warranties of the Company Correct.  The representations and warranties made by the Company in Section 3 shall be (and tender by the Company of any documents required to be delivered at the Closing by it shall constitute a representation by the Company as at the Closing that, except as otherwise specifically approved in writing by Parent, such representations and warranties of the Company are) true and correct in all material respects on and as of the Closing Date with the same force and effect as though all such representations and warranties had been made on and as of the Closing Date after giving effect to any transactions or other actions contemplated hereby.

5.5  Compliance with Terms and Conditions.  All the terms, covenants, agreements and conditions of this Agreement to be complied with and performed by the Company on or before the Closing Date shall have been (and tender by the Company of any documents required to be delivered at the Closing shall constitute a representation by the Company as at the Closing that, except as otherwise specifically approved in writing by Parent, they have been) complied with and performed in all material respects.

5.6  No Proceedings Pending.  No action, suit, claim, investigation or proceeding by or before any court, administrative agency or other governmental or regulatory body or authority shall have been instituted or threatened which may restrain, prohibit or invalidate any of the transactions contemplated by this Agreement or which may affect the right of the Company to operate or control after the Closing Date,  the Principal Assets or the Opportunity, or any part thereof.

5.7  No Material Change.  There shall have been no material adverse change in the condition, financial or otherwise, of the Company or the Principal Assets, or in the prospects thereof or therefor, and none of the Company or the Principal Assets shall have been, in the judgment of Parent, adversely affected in any material way by, or sustained any material loss, whether or not insured, as a result of, any fire, flood, accident, explosion, strike, labor disturbance, riot, act of God or the public enemy or other calamity or casualty.  the Company shall not (i) be involved in any unresolved labor trouble or dispute which materially and adversely affects the business or prospects of the Company; (ii) have become a party to any collective bargaining agreement; or (iii) have suffered any liability, judgment, lien or termination of contract or the imposition of any obligation, the effect of which shall, in the judgment of Parent, be materially adverse to the Company, the Principal Assets or the prospects of either. No fact shall have become known to the Parent regarding the Company which shall have caused the Board of Directors of the Parent to conclude that consummation of the transaction contemplated hereby would constitute a material breach of their fiduciary obligation to the Parent.

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5.8  Certificates.  The Company shall have delivered to Parent (i) a copy of the Certificate of Incorporation, as amended, of the Company, certified as of a recent date by the Secretary of State, and a long-form certificate as to the good standing of the Company from such official, in each case dated as of a recent date; (ii) a certificate as to the good standing of the Company as a foreign corporation qualified to do business in Illinois and a tax certificate of good standing from the State of Delaware dated as of a recent date; (iii) a certificate of the Secretary of the Company dated the Closing Date and certifying (A) that attached thereto is a true, correct and complete copy of the by-laws of the Company as in effect on the date of such certificate and at all times since a date prior to the date of the resolutions of the Company described in item (B) below, (B) that attached thereto is a true, correct and complete copy of the resolutions adopted by the Board of Directors of the Company authorizing the execution, delivery and performance of this Agreement and all other documents delivered by the Company in connection herewith and the consummation by the Company of the transactions contemplated by this Agreement and such other documents, and that such resolutions have not been modified, rescinded or amended and are in full force and effect, (C) that the Certificate of Incorporation of the Company has not been amended since the date of the last amendment thereto shown on the certificate of good standing furnished pursuant to (i) above and no action has been taken by the Company or its shareholders, directors or officers in contemplation of the filing of any such amendment or in contemplation of the liquidation or dissolution of the Company, and (D) as to the incumbency and specimen signature of each officer of the Company executing this Agreement or any other document delivered in connection herewith; (iv) a certificate of another officer of the Company dated the Closing Date as to the incumbency and signature of the Secretary of the Company; (v) a certificate of the Chairman of the Board of Directors, President or a Vice President of the Company stating that the representations and warranties of the Company in Section 3 hereof are true and correct as of the Closing Date with the same force and effect as if made on and as of the Closing Date and the Company has complied with all the terms and provisions contained in this Agreement or in the other documents delivered in connection herewith on its part to be observed or performed; and (vi) such other documents as Parent may reasonably request.

5.9  Required Financial Statements. The Company shall have completed and delivered to Parent (i) the financial statements of the Company required to be filed by Item 9.01(a) of Form 8-K, including audited financial statements of the Company for the years ended December 31, 2011  and interim unaudited financial statements of the Company for the six months ended June 30, 2012; and (ii) the pro forma financial information required to be filed pursuant to Item 9.01(b) of Form 8-K (collectively, the “Company Financials”).

5.10  Agreed Lock-Up.  Company shall have caused the security holders of Company’s securities

set forth on

Exhibit 5.10(i)(a)

, as designated by Parent,

 to have agreed to and signed the lock-up agreement attached hereto as Exhibit 5.10(ii). As part of the lock-up agreement, the security holders set forth on Exhibit 5.10(i)(a) shall have consented to the imposition of a legend reflecting such lock-up agreement on the certificates representing such securities.

Section 6.  Conditions Precedent to Obligations of the Company.  All obligations of the Company hereunder to be performed on or after the Closing Date are, at the option of the Company, subject to the satisfaction of the following conditions precedent at the Closing, as indicated below.

6.1  Proceedings Satisfactory.  All actions, proceedings, instruments, opinions and documents required to carry out this Agreement or incidental hereto and all other related legal matters (including the assumption of Parent’s liabilities) shall be reasonably satisfactory to the Company and to counsel for the Company.  Parent shall have delivered to the Company on the Closing Date such documents and other evidence as the Company may reasonably request in order to establish the consummation of the transactions contemplated by this Agreement, the taking of all corporate and other proceedings in connection therewith and the compliance with the conditions set forth in this Section 6, in form and substance reasonably satisfactory to the Company.

6.2  Shareholder Approval.  This Agreement shall have been adopted by the requisite vote of (a) the shareholders of the Company under the DGCL and the Company’s Certificate of Incorporation, if applicable, and the Board of Directors of Parent and the shareholders of Sub under the Nevada Revised Statutes and Parent’s and Sub’s Articles and Certificate of Incorporation, if applicable.  

6.3 Completion and Delivery of Disclosure Schedules. The Parent shall have completed and delivered to Company the Parent Disclosure Schedule and all other Parent Exhibits and Schedules referenced herein, in form and substance reasonably satisfactory to Company.  For the avoidance of doubt, the Parent is not obligated to supply any of the above-referenced schedules as a condition precedent to the execution of this agreement. 

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6.4  Representations and Warranties of Parent and Sub Correct.  The representations and warranties made by Parent and Sub in Section 4 of this Agreement shall be (and tender by Parent or Sub of any documents required to be delivered at the Closing by it shall constitute a representation by Parent and Sub at the Closing that, except as otherwise specifically approved in writing by the Company, such representations and warranties of Parent and Sub are) true and correct in all material respects on and as of the Closing Date with the same force and effect as though all such representations and warranties had been made on and as of the Closing Date after giving effect to any transactions or other actions contemplated hereby.

6.5  Compliance with Terms and Conditions.  All the terms, covenants and conditions of this Agreement to be complied with and performed by Parent or Sub on or before the Closing Date shall have been (and tender by Parent or Sub of any documents required to be delivered at the Closing by it shall constitute a representation by Parent and Sub as at the Closing that, except as otherwise specifically approved in writing by the Company, they have been) complied with and performed in all material respects.

6.6  Tax Matters.  The Company shall have received such advice or opinion as it determines to be necessary or appropriate to the effect that the Merger will be treated for federal and California income tax purposes as a tax-free reorganization within the meaning of Section 368(a) of the Code, dated on or about the Closing Date, which advice or opinion shall not have been withdrawn or modified in any material respect.

6.7  Certificates.  Parent shall have delivered to the Company (i) a copy of the Articles of Incorporation, as amended, of each of Parent and Sub, certified as of a recent date by the Secretary of State of the jurisdiction of its incorporation; (ii) a certificate of the Secretary of Parent dated the Closing Date and certifying (A) that attached thereto is a true, correct and complete copy of the by-laws of each of Parent and Sub as in effect on the date of such certificate and at all times since a date prior to the date of the resolutions of Parent and Sub described in item (B) below, (B) that attached thereto is a true, correct and complete copy of the resolutions adopted by the Board of Directors of each of Parent and Sub authorizing the execution, delivery and performance of this Agreement and all other documents delivered by Parent and Sub in connection herewith and the consummation by Parent and Sub of the transactions contemplated by this Agreement and such other documents, and that such resolutions have not been modified, rescinded or amended and are in full force and effect, (C) that the Articles of Incorporation of Parent and Sub have not been amended since the date of the last amendment thereto furnished pursuant to (i) above and no action has been taken by Parent or Sub or its respective shareholders, directors or officers in contemplation of the filing of any such amendment or in contemplation of the liquidation or dissolution of Parent or Sub, and (D) as to the incumbency and specimen signature of each officer of Parent and Sub executing this Agreement or any other document delivered in connection herewith; (iii) a certificate of another officer of Parent dated the Closing Date as to the incumbency and signature of the Secretary of Parent and Sub; (iv) a certificate of the Chairman of the Board of Directors, President or a Vice President of Parent stating that the representations and warranties of Parent and Sub in Section 4 hereof are true and correct as of the Closing Date with the same force and effect as if made on and as of the Closing Date and each of Parent and Sub has complied with all the terms and provisions contained in this Agreement or in the other documents delivered in connection herewith on its part to be observed or performed; and (v) such other documents as the Company may reasonably request.

6.8  Arrangements as to Employees.  Parent shall have caused all amounts for salary, wages and vacation pay due or accrued to all employees of Parent and Sub through the close of business on the Closing Date to have been satisfied prior to the Effective Time, including all associated remittance to the appropriate authority for all withholding, social security and other employer and employee taxes due or to become due in respect of the operation of Parent’s and Sub’s business through such date.

6.9  Agreed Lock-Up.  Parent shall have caused the security holders of Parent’s securities 

set forth on

Exhibit 5.10(i)(b)

, as designated by the Company,

 to have agreed to and signed the lock-up agreement attached hereto as Exhibit 5.10(ii). As part of the lock-up agreement, the security holders set forth on Exhibit 5.10(i)(b) shall have consented to the imposition of a legend reflecting such lock-up agreement on the certificates representing such securities.

6.10

  Elimination of Liabilities.  Parent shall have eliminated or provided for the elimination of all obligations and liabilities of Parent and Sub  to the satisfaction of the Company and its counsel. 

6.11

  Parent and Sub Director Resignations. Each of the Parent and Sub directors and officers, other than those identified by the Company in Exhibit 1.5, shall have (i) resigned as a director and/or officer of Parent and Sub and (ii) tendered his or her resignation as a director and/or officer of Parent or Sub, to become effective automatically upon expiration of any applicable waiting period under Rule 14f-1 of the Exchange Act.  

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6.12  Series B Preferred Stock. Parent shall have (1) approved and adopted the Certificate of Designation of Series B Convertible Preferred Stock (the “Series B Certificate”) attached hereto as Exhibit 6.12, (2) filed the Series B Certificate with the Nevada Secretary of State, (3) caused its Board of Directors to approve (i) the authorization of 44,000,000 shares of Parent Series B Preferred Stock and (ii) authorization for the Board of Directors to issue the Parent Series B Preferred Stock and (4) prepare the certificates for the Parent Series B Preferred Stock to be issued pursuant to Section 2.1(d), to be delivered at Closing.  Further, (x) Parent and the holders of the outstanding 40,000,000 outstanding shares of Parent Series A Preferred Stock shall have executed and delivered agreements for the exchange of such shares into 100,000 shares of Parent Series B Preferred Stock (and delivered duly endorsed certificates for the related shares to the Company) , to be effective at Closing; and (y) Parent and all holders of Parent’s outstanding indebtedness shall have executed and delivered agreements for the conversion of such indebtedness into an aggregate of 5,900,000 shares of Parent Series B Preferred Stock, to be effective at Closing.

6.13  Securities Filings.  Contemporaneous with or prior to 5:30 p.m. (New York City time) on the fourth (4th) business day following the Execution Date, Parent shall have filed any statement required on Form 8-K (the “Execution Form 8-K”), describing the terms of the transactions contemplated by this Agreement in the forms required by the Exchange Act.  Parent shall have filed and mailed the information required by Rule 14f-1 of the Exchange Act (the “Schedule 14f-1“) in accordance with Rule 14f-1 of the Exchange Act on or prior to the tenth (10th) business day following the Execution Date and at least 10 days prior to the Closing Date.  Parent shall have filed its Quarterly Report on Form 10-Q for the quarter ended June 30, 2012 in a timely manner.  Parent, Sub and the Company shall use their respective best efforts to obtain effectiveness of any statements filed pursuant to this paragraph should any comments arise from the SEC.

6.14  Required Financial Statements. The Company shall have completed and delivered to Parent the Company Financials.

6.15

No Proceedings Pending.  No action, suit, claim, investigation or proceeding by or before any court, administrative agency or other governmental or regulatory body or authority shall have been instituted or threatened which may restrain, prohibit or invalidate any of the transactions contemplated by this Agreement or which may affect the right of Parent or Sub to operate or control after the Closing Date, the Parent Assets or Sub Assets, or any part thereof.

6.16

No Material Change.  There shall have been no material adverse change in the condition, financial or otherwise, of Parent or Sub or the Parent Assets or Sub Assets, or in the prospects thereof or therefor, and none of Parent or Sub or the Parent Assets or Sub Assets shall have been, in the judgment of the Company, adversely affected in any material way by, or sustained any material loss, whether or not insured, as a result of, any fire, flood, accident, explosion, strike, labor disturbance, riot, act of God or the public enemy or other calamity or casualty.  Parent and Sub shall not (i) be involved in any unresolved labor trouble or dispute which materially and adversely affects the business or prospects of Parent or Sub; (ii) have become a party to any collective bargaining agreement; or (iii) have suffered any liability, judgment, lien or termination of contract or the imposition of any obligation, the effect of which shall, in the judgment of the Company, be materially adverse to Parent or Sub, the Parent Assets or Sub Assets or the prospects of either.  No fact shall have become known to the Company  regarding Parent or Sub which shall have caused the Board of Directors of the Company to conclude that consummation of the transaction contemplated hereby would constitute a material breach of their fiduciary obligation to the Company.

Section 7.  Additional Covenants of the Company.  

7.1  Consents.  The Company covenants to Parent and Sub that it will use its commercially reasonable efforts to obtain or cause to be obtained from any required parties any consents, approvals, authorizations or waivers required hereunder in connection with the Merger.

7.2   Cooperation.  The Company covenants to Parent and Sub that, from the Execution Date to and including the Closing Date, it will:

(a)

Access to Information.  Cooperate and cause others under the control of the Company to cooperate to the end of providing Parent and its counsel, accountants and other designated representatives full access during normal business hours to the properties, books, contracts, commitments and other records (including computer files, retrieval programs and related documentation) of the Company relating to the Principal Assets or the Opportunity, and the Company will furnish or cause to be furnished to Parent and such representatives during such period all such information and data concerning the same as Parent or such representatives reasonably may request.  Parent may, from the Execution Date to the Closing Date, contact vendors, customers and manufacturers and others with whom the Company does business in connection with the Opportunity; and

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(b)

Keep Parent Informed.  Promptly notify Parent of any material matter or thing occurring which adversely affects the condition, financial or otherwise, of the Principal Assets or the Opportunity, or the prospects thereof or therefor.

7.3   Preserve the Opportunity.

The Company covenants to Parent and Sub that, from the Execution Date to and including the Closing Date:

(a)

the Company will do or cause to be done all things necessary and appropriate to (A) continue operation of the Opportunity in the ordinary course in the same manner in which it has heretofore been conducted; (B) preserve intact the business organization and reputation of the Company; (C) continue and maintain in force any insurance; (D) except as otherwise contemplated herein, use its best efforts to keep available the services of the management and employees of the Company; and (E) preserve the goodwill of suppliers, customers and others having business relations with the Company; and

(b)

the Company will not, without the prior consent of Parent, (A) sell (except in the ordinary course of the conduct of the Opportunity), pledge, assign, lease, give a security interest in or otherwise encumber any of the Principal Assets; (B) enter into any commitment with respect to the operation of the Opportunity, except in the ordinary course of the conduct of the Opportunity; (C) voluntarily incur or become subject to, or agree to incur or become subject to, any obligation or liability (absolute or contingent) in connection with the Opportunity, except current liabilities incurred and obligations under contracts entered into in the ordinary course of the conduct of the Opportunity; (D) discharge or satisfy any lien or encumbrance or pay any obligation or liability (absolute or contingent) in connection with the Opportunity, except current liabilities incurred in the ordinary course of the conduct of the Opportunity; (E) declare or make, or enter into any agreement to declare or make, any payment of dividends or distributions of any assets of any kind whatsoever to shareholders of the Company, or purchase or redeem, or agree to purchase or redeem, any of its stock or other securities; (F) mortgage, pledge, or suffer any lien, charge or any other encumbrance, or enter into any agreement to do so, in respect to any of the Principal Assets; (G) sell or transfer, or enter into any agreement to sell or transfer, any of the Principal Assets or cancel or enter into any agreement to cancel any debts or claims, except in each case in the ordinary course of the conduct of the Opportunity; (H) bring about or cause to occur any extraordinary losses or waive any rights of substantial value; (I) enter into any transactions other than in the ordinary course of the conduct of the Opportunity; (J) terminate any material contract, agreement, license or other instrument to which it is a party, except agreements which are by their terms terminable in the ordinary course of the conduct of the Opportunity; (K) through negotiation or otherwise, make any commitment or incur any liability or obligation to any labor organization; (L) make, or agree to make, any accrual or arrangement for or payment of bonuses or special compensation of any kind to any officer, employee or agent (except as permitted or required by this Agreement); (M) increase the rate of compensation payable or to become payable by the Company to any of its officers, employees or agents over the rate being paid to them at the Execution Date; (N) directly or indirectly, pay or make a commitment to pay any severance or termination pay to any officer, employee or agent; (O) introduce any new method of accounting in respect of the Principal Assets, Opportunity, or rights applicable thereto; (P) make any capital expenditures or enter into commitments for capital expenditures exceeding in the aggregate $10,000; or (Q) enter into any transactions other than in the ordinary course of the conduct of the Opportunity.

7.4  Ordinary Course.  The Company covenants to Parent and Sub that, notwithstanding Section 7.3, at all times from and after the Execution Date until the Closing Date, it covenants and agrees as to itself and its Subsidiaries that (except as expressly contemplated or permitted by this Agreement, or to the extent that Parent shall otherwise consent in writing) the Company and each of its Subsidiaries shall conduct its businesses only in, and none of the Company and such Subsidiaries shall take any action except in, the ordinary course consistent with past practice.

7.5  Form 8-K, Schedule 14f-1 and Form 10-Q.  The Company shall render to Parent such assistance in drafting the Execution Form 8-K, the Announcing Form 8-K (as defined in Section 8.6), the Schedule 14f-1and the Form 10-Q for the quarter ended June 30, 2012, as the Parent may reasonably require. 

Section 8.  Additional Covenants by Parent and Sub.

8.1  Consents and Waivers.  Each of Parent and Sub will use commercially reasonable efforts to assist the Company in obtaining from any required parties any consents, approvals, authorizations or waivers required hereunder in connection with the Merger. 

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8.2  Books and Records.  After the Execution Date, Parent and Sub shall permit the Company and its authorized representatives, in connection with (i) the preparation of the Company’s tax returns, (ii) the determination or enforcement of the Company’s rights and obligations under this Agreement, (iii) the Company’s compliance with the requirements of any governmental or quasi-governmental authority or body or (iv) the matters described in paragraph (c) below, to have reasonable access during normal business hours to the Books and Records relating to the operation of the Opportunity prior to the Closing Date.

8.3  Post-Closing Shareholders Meeting.  As soon as is reasonably practicable after the Closing Date, Parent will take all action necessary to duly call, give notice of, convene and hold a meeting for the Parent shareholders to vote on the Related Transactions required of the Parent pursuant to Section 8.3(b) (the “Shareholders Meeting”). 

(a)

Proxy Statement. In connection with the Shareholders Meeting,  as soon as reasonably practicable following the Closing Date the Parent shall prepare and file the a proxy statement with the SEC. Parent and Sub will cooperate and consult with each other and the Company in the preparation of the proxy statement. The Company shall use its reasonable best efforts to resolve, and each party agrees to consult and cooperate with the other party in resolving, all SEC comments with respect to the proxy statement as promptly as practicable after receipt thereof and to cause the proxy statement in definitive form to be cleared by the SEC and mailed to the Parent’s shareholders as promptly and as reasonably practicable following filing with the SEC. 

(b)

Related Transactions. As soon as is reasonably practicable following the Closing Date, Parent shall effect or implement the following actions (the “Related Transactions”):

(i)

Effect a reverse stock split on a 1-for-800 basis of the outstanding Parent Common Stock (the “Stock Split”), except that the number of shares to be issued to any holder which would have less than 100 shares as a result of the Stock Split shall be rounded up to 100; and

(ii)

Change the name of the Parent from “Cellteck, Inc.” to “Eos Petro, Inc.”

8.4  Public Announcements.  Except as required by applicable law, Parent shall not make any public announcement regarding the transactions contemplated hereby prior to the Closing.  Parent shall consult with, and provide drafts of any proposed release to, the Company prior to the release of any such announcement.

8.5  Ordinary Course.  At all times from and after the Execution Date until the Closing Date, Parent covenants and agrees as to itself and its Subsidiaries that (except as expressly contemplated or permitted by this Agreement, or to the extent that the Company shall otherwise consent in writing) Parent and each of its Subsidiaries shall conduct its businesses only in, and none of Parent and such Subsidiaries shall take any action except in, the ordinary course consistent with past practice.

8.6  Announcing Report, Schedule 14f-1 and Form 10-Q.   Contemporaneous with or prior to 5:30 p.m. (New York City time) on the fourth (4th) business day following the Closing Date, and subject to the covenant of the Company pursuant to Section 7.5, Parent, shall file a Form 8-K with the SEC describing the terms of the transactions contemplated by this Agreement in the form required by the Exchange Act, including any financial statements and other information that would be required in a registration statement on Form 10 (the “Announcing Form 8-K”).  Parent shall file and mail the Schedule 14f-1  in accordance with Rule 14f-1 of the Exchange Act on  or prior to the tenth (10th) business day following the Execution Date and at least 10 days prior to the Closing Date, subject to the covenant of the Company pursuant to Section 7.5.  Parent shall file its Quarterly Report on  Form 10-Q for the quarter ended June 30, 2012 in a timely manner.  

Section 9.  Indemnification.

9.1  Indemnity Agreement of the Company.  Subject to the provisions and limitations of this Section 9, the Company, for itself, its successors and assigns, agrees to indemnify and save harmless each of Parent and Sub and its respective officers, directors, representatives, and agents from and against:

(a)  Failure to Perform Obligations.  Any Event of Loss (as defined below) or Loss (as defined below) arising as a result of the Company’s failure to perform or discharge any of its duties or obligations to be performed by the Company hereunder prior to the Closing Date; and

(b)  Breach of Representation Warranty or Covenant.  Any Event of Loss or Loss arising from any breach of a representation, warranty or covenant of the Company set forth in this Agreement. 

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9.2  Indemnity Agreement of Parent and Sub.  Subject to the provisions and limitations of this Section 9, each of Parent and Sub, for itself, its successors and assigns, agrees to indemnify and save harmless the Company from and against:

(a)

Failure to Perform Obligations.  Any Event of Loss or Loss arising as a result of Parent’s or Sub’s failure to discharge or perform any duties or obligations to be performed by Parent or Sub hereunder prior to the Closing Date; 

(b)

Breach of Representation, Warranty or Covenant.  Any Event of Loss or Loss arising from any breach of a representation, warranty or covenant of Parent or Sub set forth in this Agreement; and

9.3  Definition of “Loss”.  Any party to this Agreement against which indemnification may be sought pursuant to this Section 9 shall be herein called an “Indemnifying Party,” and any person entitled to indemnification pursuant to this Section 9 shall be herein called an “Indemnified Party.”  The occurrence of an event which may result in a loss, cost, expense or liability of an Indemnified Party hereunder as to which the Indemnifying Party shall have received notice from the Indemnified Party shall be herein called an “Event of Loss,” and the amount of any loss, cost, expense or liability of any kind whatsoever (including legal fees and disbursements incurred in connection therewith) incurred by an Indemnified Party shall be herein called a “Loss;” provided, however, that for purposes of computing the amount of Loss incurred by any Indemnified Party, there shall be deducted an amount equal to the amount of any insurance proceeds (other than self-insurance) directly or indirectly received by such Indemnified Party in connection with such Loss or the circumstances giving rise thereto.

Upon payment by an Indemnified Party of any Loss, the Indemnifying Party shall discharge its obligation to indemnify the Indemnified Party against such Loss by paying to the Indemnified Party an amount that, on an after-tax basis reflecting the hypothetical tax consequences, if any, of the receipt of such amount, shall be equal to the hypothetical after-tax amount of such Loss by taking into account the hypothetical tax consequences, if any, to the Indemnified Party of the payment of such Loss.  For purposes of this Section 9, references to “after-tax basis,” “hypothetical” tax consequences and “hypothetical” after-tax amount refer to calculations of foreign, federal, state and local tax at the maximum statutory rate (or rates, in the case of an item of income or deduction taxable or deductible for purposes of more than one tax) applicable to the Indemnified Party for the relevant year, after taking into account, for example, the effect of deductions available for other taxes such as state and local income taxes, which effect would similarly be calculated on the basis of the maximum statutory rate (or rates) of the tax (or taxes) for which such deduction was available.

9.4  Insurance Proceeds Received After Indemnification.  Each party agrees that, if it receives any payments from the other party hereto with respect to any Loss pursuant to this Section 9 and subsequently such party receives any amount of insurance proceeds (other than from self-insurance) in connection with any such Loss or the circumstances giving rise thereto, such party agrees to promptly deliver or cause to be delivered the amount of such insurance proceeds to the party that made such indemnification payments pursuant to this Section 9; provided, however, a party shall not be required to pay (or cause to be paid) to the other party an amount of insurance proceeds in excess of the payment in respect of the related Loss paid by the Indemnifying Party.

9.5  Deductible Amount and Time Period.  An Indemnifying Party shall not be required to make any indemnification payments hereunder for which such Indemnifying Party would otherwise be liable under this Section 9 until (and then only to the extent that) the total of all amounts to which, but for the provisions of this sentence, the Indemnified Party would be entitled pursuant to this Section 9 with respect to all Losses actually exceeds $100,000; provided, however, that the limitations on liability set forth in this sentence shall not be applicable to (i) any claim against an Indemnifying Party alleging fraudulent misrepresentation or (ii) any payments to be made by the Indemnifying Party pursuant to any provision of this Agreement (other than those set forth in this Section 9) or any provision of the instruments of assumption referred to herein.

Notwithstanding anything in this Section 9 to the contrary, the Indemnifying Party shall have (i) no liability for any Loss arising out of claims of a person not a party or an affiliate of a party to this Agreement as to which the Indemnifying Party shall not have received notice within one year from the Closing Date and (ii) no liability for any Loss arising out of claims under this Agreement (other than those referred to in clause (i) of this sentence) as to which the Indemnifying Party shall not have received notice within four years from the Closing Date.

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9.6  Defense of Claims.  In case any legal action shall be commenced or threatened (provided that in the case of a threatened legal action the Indemnified Party believes in good faith that an indemnifiable Loss is likely to occur) against an Indemnified Party which could result in a Loss, the Indemnified Party shall promptly notify the Indemnifying Party in writing.  After receipt of any such notice, the Indemnifying Party shall have the right, exercisable by written notice of exercise to the Indemnified Party promptly after receipt of the notice provided for in the next preceding sentence, (A) to participate in and (B) assume (and control) the defense of such action, at its own expense and with its own counsel, provided such counsel is satisfactory to the Indemnified Party.  If the Indemnifying Party elects to assume the defense of such action, the Indemnifying Party shall keep the Indemnified Party informed of all material developments and events relating to such action.  The Indemnified Party shall have the right to participate in (but not control) the defense of any such action, but the fees and expenses of counsel for the Indemnified Party shall be at its own expense except as set forth in the following sentence.  The Indemnifying Party shall bear the reasonable fees and expenses of counsel retained by the Indemnified Party if (i) the Indemnified Party shall have retained such counsel due to actual or potential conflicting interests between the Indemnified Party and the Indemnifying Party, (ii) the Indemnifying Party shall not elect to assume the defense of the action, (iii) the Indemnifying Party shall not have employed counsel satisfactory to the Indemnified Party to represent the Indemnifying Party in connection with its assumption of the defense of the action within a reasonable time after notice pursuant to the first sentence of this paragraph is delivered to the effect that such action has been commenced or is threatened, or (iv) the Indemnifying Party has authorized the employment of counsel for the Indemnified Party to handle the defense of the action at the expense of the Indemnifying Party.  In no event will the Indemnifying Party be liable for any settlement or admission of liability with respect to any action without its prior written consent, which shall not be unreasonably withheld, but if settled with such consent, the Indemnifying Party shall be liable therefor, subject to the limitations set forth in this Section 9.  The Indemnifying Party may not settle any liability or claim subject to indemnification pursuant to this Section 9 without the consent of the Indemnified Party and on any basis that does not provide for a full release of the Indemnified Party.  Any participation in, or assumption of the defense of, any action by an Indemnifying Party shall be without prejudice to the right of the Indemnifying Party, and shall not be construed as a waiver of its right to deny the obligation to indemnify the Indemnified Party.  The giving of notice as above provided of a loss, damage, cost or expense claimed to be indemnifiable hereunder and the opportunity to exercise the right, as the same is provided (and limited) herein, to participate in and assume control of the defense against such claim shall be a prerequisite to any obligation to indemnify; provided, however, that the Indemnified Party’s rights pursuant to this Section 9 shall not be forfeited by reason of a failure to give such notice or to cooperate in the defense to the extent such failure does not have a material and adverse effect on the defense of such matter.  Notwithstanding any of the above, Parent shall have control of any action arising from a tax claim to the extent such claim is reflected on Parent’s tax returns.

9.7  Payment of Loss; Subrogation.  Any Loss for which an Indemnified Party is entitled to payment hereunder shall be paid by the Indemnifying Party upon written demand by the Indemnified Party.  The Indemnifying Party shall be subrogated to any claims or rights of the Indemnified Party as against any other persons with respect to any Loss paid by the Indemnifying Party under this Section 9.  The Indemnified Party shall cooperate with the Indemnifying Party to a reasonable extent, at the Indemnifying Party’s expense, in the assertion by the Indemnifying Party of any such claims against such other persons.

9.8  Notice of Event of Loss.  Each party agrees that it will give notice to the other party hereunder promptly, but in no event later than 30 days, after the receipt by one of its responsible officers of knowledge of a state of facts which, if not corrected, would be an Event of Loss hereunder.  Each party shall make available to the other party and its counsel and accountants, at reasonable times and for reasonable periods, during normal business hours, all books and records of such party relating to any such possible Event of Loss, and each party will render to the other such assistance as it may reasonably require of the other in order to insure prompt and adequate prosecution of the defense of any suit, claim or proceeding based upon such state of facts.

Section 10.  Termination of Agreement.  This Agreement and the transactions contemplated hereby may be terminated in the following manner:

10.1  This Agreement may be terminated at any time before Closing by the mutual consent of the Board of Directors of Parent (on behalf of Parent and Sub) and the Board of Directors of the Company.

10.2  Either Parent or the Company may terminate this Agreement prior to Closing if:

(a)

the other (with Parent and Sub being one party for this purpose) breaches its representations, warranties or covenants herein in any material respect; 

(b)

any event occurs or fails to occur which renders impracticable satisfaction of any of the conditions to its respective obligations under Sections 5 or 6 hereof;

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(c)

the Company Financials have not been completed and/or delivered to Parent by September 30, 2012; or

(d)

the Closing of the Agreement has not occurred by September 30, 2012. 

The parties acknowledge that time is of the essence with respect to the items described in Sections 10.2(c) and (d).

10.3  Upon termination of this Agreement as provided for above and notwithstanding any other provision of this Agreement, none of the parties hereto shall have any further rights or obligations hereunder.  In the event of the termination of this Agreement as provided for above, the provisions set forth in the first sentence of Section 11.1 and in Section 11.4 shall survive such termination.  

10.4  Written notice of termination of this Agreement, as provided for in this Section 10, shall be given by the party so terminating to the other party hereto, in accordance with the provisions of Section 11.9 hereof.

Section 11.  Miscellaneous Provisions.

11.1  Expenses.  Except as otherwise provided in this Agreement, each party hereto shall pay its own expenses incident to the origination, negotiation and execution of this Agreement and the consummation of the transactions contemplated hereby, including all legal and accounting fees and disbursements.  Notwithstanding the foregoing, from the Execution Date through the earlier to occur of the Closing Date or the termination of this Agreement, the Company shall pay all out of pocket expenses associated with  (i) the preparation and submission of Parent’s filings under the Securities Exchange Act of 1934, including with respect to the Execution Form 8-K, the Announcing Form 8-K, the Schedule 14f-1 and the Form 10-Q for the quarter ended June 30, 2012, except that Parent shall pay all amounts due its internal accountant and independent auditor in respect of the preparation of the financial portion of the Form 10-Q for the quarter ended June 30, 2012 and its attorneys with respect to all such filings, (ii) the printing and mailing of the Schedule 14f-1 to the stockholders of Parent, and (iii) such filings as Parent may be required to make with the Secretary of State of Nevada and Delaware in connection with the Merger; and Parent shall be obligated to pay all other expenses of Parent; provided, that for purposes of clarity, Parent shall be in compliance with the requirement in Section 6.10 of this Agreement that all liabilities of Parent shall have been paid in full or otherwise converted into securities of Parent at Closing, except to the extent such expenses are the obligation of the Company.  The parties acknowledge that the Company has paid for the expense of forming Sub and engaging an agent for service of process for Sub.  Parent will have no obligation to reimburse the Company for expenses paid in connection with the formation and organization of Sub and shall not be required to eliminate those obligations of Sub prior to Closing, as set forth in Section 6.10, which have been incurred with the prior written consent of the Company.  Sub shall not, and Parent will not allow Sub to, incur any expense or liability without the prior written consent of the Company, such consent not to be unreasonably withheld or delayed.  In the event of the termination of this Agreement, the Company shall not look to Parent for reimbursement of such expenses and Parent shall assign, upon the written request of the Company, all rights to the ownership of Sub to the Company (free of liabilities other than those expressly assumed by the Company pursuant to this Agreement).

11.2  Payment and Expenses of Other Parties.  The Company, Parent and Sub agree that if subsequent to the Closing Date any of them shall receive any payment due to another party each shall promptly remit the same to the other (net of any tax imposed upon either party in respect of the receipt of such payment), and if any party shall pay any obligations of the other not assumed by it hereunder, the payment shall be for the account of the party to whom the obligation relates and such party shall promptly reimburse the other party for any such payment.

11.3  Annexes and Schedules.  The Annexes and Schedules attached hereto are incorporated herein and made a part hereof for all purposes.  As used herein, the expression “this Agreement” means the body of this Agreement and such Annexes and Schedules; and the expressions “herein,” “hereof,” and “hereunder” and other words of similar import refer to this Agreement and such Annexes and Schedules as a whole and not to any particular part or subdivision thereof.

11.4  Survival of Obligations.  Subject to the applicable limitations of Section 10 above, the respective representations, warranties, covenants and agreements of the parties to this Agreement shall survive consummation of the transactions contemplated by this Agreement and shall continue in full force and effect after the Closing Date.

22

11.5  Amendments and Waivers.  Except as otherwise specifically stated herein, any provision of this Agreement may be amended by, and only by, a written instrument executed by Parent on one part (acting as a single party for purposes of this Section 11.5 with Sub) and the Company on another part.  The Company may extend the time for or waive the performance of any obligation of Parent or Sub, waive any inaccuracies in the representations or warranties by Parent or Sub or waive compliance by Parent or Sub with any of the terms and conditions contained in this Agreement.  Any such extension or waiver shall be in writing and executed by the Company.  Parent may extend the time for or waive the performance of any obligations of the Company, waive any inaccuracies in the representations or warranties by the Company, or waive compliance by the Company with any of the terms and conditions contained in this Agreement.  Any such extension or waiver shall be in writing and executed by Parent.

11.6  Further Assurances.  From and after the Closing Date, the parties shall, on request, cooperate with one another by furnishing any additional information, executing and delivering any additional documents and instruments, and doing any and all such other things as may be reasonably required by the parties or their counsel to consummate or otherwise implement the transactions contemplated by this Agreement.

11.7  Public Statements.  Except as may be required by law, none of the Company, Parent or Sub shall issue any press release or other public statement concerning the transactions contemplated by this Agreement without first providing the others with a written copy of the text of such release or statement and obtaining the consent of the other (with Parent acting on behalf of itself and Sub) respecting such release or statement.

11.8  Confidentiality.  If the transactions contemplated by this Agreement shall be consummated, (i) the Company shall keep this Agreement, the terms hereof, and all documents and information relating to this Agreement and to the Opportunity confidential, except as may be required by law and (ii) Parent and Sub shall keep this Agreement, the terms hereof, and all documents and information received from the Company, to the extent they relate to anything other than the Opportunity, confidential, except as may be required by law.  In the event that the transactions contemplated by this Agreement shall not be consummated, each party (with Parent acting on behalf of itself and Sub as a single party for purposes of this Section 11.8) (i) shall return to the other party all such documents and written information as it shall have received from the other party in connection with this Agreement, (ii) shall treat such documents and information as confidential, and (iii) shall not disclose or utilize, and shall use its best efforts to prevent any of its employees from disclosing or utilizing, such documents and information.  However, in any event, the restrictions of this Section 11.8 shall not apply (i) in the case of Parent, to any document or information if such document or information (A) was already known to Parent, as evidenced by Parent’s written records, prior to the receipt of such document or information from the Company, (B) was publicly available at the time of the disclosure of such document or information by the Company to Parent or subsequently became publicly available through no fault of Parent, or (C) was approved for public disclosure by the written authorization of the Company and (ii) in the case of the Company, to any document or information, if such document or information (A) was publicly available at the time of disclosure of such document or information by the Company to Parent or subsequently became available through no fault of the Company or (B) was approved for public disclosure by the written authorization of Parent.  Notwithstanding any termination of this Agreement, the parties’ obligations under this Section 11.8 shall continue and survive such termination for a period of five years from the Execution Date.

11.9  Parties Bound.  This Agreement shall apply to, inure to the benefit of and be binding upon and enforceable against the parties hereto and their respective successors and permitted assigns.  The respective rights and obligations of any party hereto shall not be assignable without the consent of the other parties except that any and all obligations, duties, liabilities, rights and benefits owing to Parent or Sub or to be performed by Parent or Sub may be assigned to, and thereafter assumed and performed or received by, any corporation or partnership (designated by Parent by notice to the Company) of which 100% of the capital stock or equity interests are owned directly or indirectly by Parent or any corporation or partnership which owns directly or indirectly 100% of the capital stock of Parent, or a limited partnership of which Parent or a wholly-owned subsidiary of Parent is the sole general partner; provided, however, that Parent or Sub, as applicable, will be liable for all obligations of Parent or Sub, as applicable, to be performed hereunder to the extent not performed by such corporation or partnership in accordance with the terms hereof.

11.10  Governing Law.  This Agreement, and the rights and obligations of the parties hereto, shall be governed by and construed in accordance with the laws of the State of California, provided that the effect of the Merger shall be as provided under the law of the State of Delaware.  Jurisdiction and venue for any action or proceeding shall be in the appropriate federal or state court located within the County of Los Angeles, State of California.

23

11.11  Remedies.  Each party recognizes that money damages may be inadequate to compensate a party for a breach by the other party of its obligations under this Agreement, and each party agrees that in the event of such a breach non-breaching party may apply for an injunction of specific performance or the granting of such other equitable remedies as may be awarded by a court of competent jurisdiction in order to afford the non-breaching party the benefits of this Agreement and that the breaching party shall not object to such application, entry of such injunction or granting of such other equitable remedies on the ground that money damages will be sufficient to compensate the non-breaching party.

11.12  Notices.  Any notice, demand, approval, consent, request, waiver or other communication which may be or is required to be given pursuant to this Agreement shall be in writing and shall be deemed given on the earlier of the day actually received or on the close of business on the second business day next following the day when deposited in the United States mail, postage prepaid, certified or registered, addressed to the party at the address set forth after its respective name below, or at such different address as such party shall have theretofore advised the other party in writing, with copies sent to the persons indicated:

If to the Company:

2049 Century Park East, Suite 3760

Los Angeles, California 90067

Attention:  Nikolas Konstant, Chairman

If to Parent or Sub:

417 Exeter Road

London, ON N6E 2Z3 Canada

Attention:  Gus Rahim, President

12.13  Number and Gender of Words.  Whenever herein the singular number is used, the same shall include the plural where appropriate, and the words of any gender shall include each other gender where appropriate.

12.14  Captions.  The captions, headings and arrangements used in this Agreement are for convenience only and do not affect, limit or amplify the terms and provisions hereof.

12.15  Invalid Provisions.  If any provision hereof is held to be illegal, invalid or unenforceable under present or future laws effective during the term hereof, such provision shall be fully severable; this Agreement shall be construed and enforced as if such illegal, invalid or unenforceable provision had never comprised a part hereof; and the remaining provisions hereof shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable provision or by its severance herefrom.  In lieu of such illegal, invalid or unenforceable provision there shall be added automatically as a part hereof a provision as similar in terms to such illegal, invalid or unenforceable provision as may be possible and be legal, valid and enforceable.

12.16  Accounting Terms.  Unless otherwise specified or agreed to in writing by the parties hereto, all accounting terms used in this Agreement shall be interpreted in accordance with United States generally accepted accounting principles applied on a consistent basis.

12.17  Entirety of Agreement.  This Agreement contains the entire agreement between the parties.  No representation, inducements, promises or agreements, oral or otherwise, which are not embodied herein shall be of any force or effect.  

12.18  Currency.  All dollar amounts stated herein, unless otherwise specified, are stated in United States currency.

12.19  Brokerage and Finder’s Fees.  Each party hereto agrees to pay all expenses and fees it has incurred to the extent that it has engaged a broker or finder in connection with this transaction and further agrees to indemnify and save the other party hereto harmless from any claims by any such brokers or finders in connection with the Merger and the other transactions contemplated by this Agreement.

12.20  Multiple Counterparts; Effectiveness.  This Agreement may be executed in multiple counterparts, each of which shall be deemed an original for all purposes and all of which shall be deemed, collectively, one agreement.  This Agreement shall become effective when executed and delivered by the parties hereto.

24

IN WITNESS WHEREOF, the parties hereto have executed this Agreement and Plan of Merger as of the date first above written.

PARENT:

CELLTECK, INC.

By       /s/ Gus Rahim                                                  

Gus Rahim

President

SUB:

EOS MERGER SUB

By      /s/ Gus Rahim                                                     

Gus Rahim

President

THE COMPANY:

EOS PETRO, INC.

By      /s/ Nikolas Konstant                                          

Nikolas Konstant

Chairman

25exhibit4-1.htm

 

                                                                                                          Exhibit Exhibit 4.1

	  
	
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST

 

	
 

 

 

Issuer

 

 

 

	
and

 

 

 

	
UNION BANK, N.A.

 

 

 

	
Indenture Trustee

 

 

 

	
Series 2012-B INDENTURE SUPPLEMENT

 

 

 

	
Dated as of July 19, 2012

  

  

TABLE OF CONTENTS

	
ARTICLE I.

	
CREATION OF THE SERIES 2012-B NOTES 

	
1

 

	
  

	
Section 1.1

	
Designation 

	
1

 

	
  

	
Section 1.2

	
Transfer Restrictions 

	
2

 

	
ARTICLE II.

	
DEFINITIONS 

	
4

 

	
  

	
Section 2.1

	
Definitions 

	
4

 

	
ARTICLE III.

	
NOTEHOLDER SERVICING FEE 

	
19

 

	
  

	
Section 3.1

	
Servicing Compensation 

	
19

 

	
  

	
Section 3.2

	
Covenants 

	
19

 

	
ARTICLE IV.

	
RIGHTS OF SERIES 2012-B NOTEHOLDERS AND ALLOCATION AND APPLICATION OF COLLECTIONS 

	
19

 

	
  

	
Section 4.1

	
Collections and Allocations 

	
19

 

	
  

	
Section 4.2

	
Determination of Monthly Interest 

	
23

 

	
  

	
Section 4.3

	
Determination of Monthly Principal 

	
25

 

	
  

	
Section 4.4

	
Application of Available Finance Charge Collections and Available Principal Collections 

	
25

 

	
  

	
Section 4.5

	
Investor Charge-Offs 

	
29

 

	
  

	
Section 4.6

	
Reallocated Principal Collections 

	
29

 

	
  

	
Section 4.7

	
Excess Finance Charge Collections 

	
29

 

	
  

	
Section 4.8

	
Shared Principal Collections 

	
29

 

	
  

	
Section 4.9

	
Certain Series Accounts 

	
30

 

	
  

	
Section 4.10

	
Reserve Account 

	
31

 

	
  

	
Section 4.11

	
Spread Account 

	
32

 

	
  

	
Section 4.12

	
Investment Instructions 

	
34

 

	
  

	
Section 4.13

	
Controlled Accumulation Period 

	
35

 

	
  

	
Section 4.14

	
Suspension of Controlled Accumulation Period 

	
35

 

	
ARTICLE V.

	
DELIVERY OF SERIES 2012-B NOTES; DISTRIBUTIONS; REPORTS TO SERIES 2012-B NOTEHOLDERS 

	
37

 

	
  

	
Section 5.1

	
Delivery and Payment for the Series 2012-B Notes 

	
37

 

	
  

	
Section 5.2

	
Distributions 

	
37

 

	
  

	
Section 5.3

	
Reports and Statements to Series 2012-B Noteholders 

	
38

 

	
ARTICLE VI.

	
SERIES 2012-B EARLY AMORTIZATION EVENTS 

	
38

 

	
  

	
Section 6.1

	
Series 2012-B Early Amortization Events 

	
38

 

	 	
i

	  

  

  

  

TABLE OF CONTENTS

(continued)

Page

	
ARTICLE VII.

	
REDEMPTION OF SERIES 2012-B NOTES; FINAL DISTRIBUTIONS; SERIES TERMINATION 

	
40

 

 

	 	
Section 7.1

	
Optional Redemption of Series 2012-B Notes;Final Distributions

	
40

      

	
  

	
Section 7.2

	
Series Termination 

	
42

 

	
ARTICLE VIII.

	
MISCELLANEOUS PROVISIONS 

	
42

 

	
  

	
Section 8.1

	
Ratification of Indenture; Amendments 

	
42

 

	
  

	
Section 8.2

	
Form of Delivery of the Series 2012-B Notes 

	
42

 

	
  

	
Section 8.3

	
Counterparts 

	
42

 

	
  

	
Section 8.4

	
GOVERNING LAW 

	
42

 

	
  

	
Section 8.5

	
Limitation of Liability 

	
43

 

	
  

	
Section 8.6

	
Rights of the Indenture Trustee 

	
43

 

	
  

	
Section 8.7

	
Additional Provisions 

	
43

 

	
  

	
Section 8.8

	
Notice Address for Rating Agencies 

	
43

 

	
  

	
Section 8.9

	
Additional Requirements for Registration of and Limitations on Transfer and Exchange of Notes 

	
43

 

	 	
ii

	  

  

  

  

 

EXHIBITS

 

	 EXHIBIT A-1   	 FORM OF CLASS A NOTE
	 EXHIBIT A-2A	 FORM OF DEFINITIVE CLASS M NOTE
	 EXHIBIT A-2B   	 FORM OF GLOBAL CLASS M NOTE
	 EXHIBIT A-3A       	 FORM OF DEFINITIVE CLASS B NOTE
	 EXHIBIT A-3B	 FORM OF GLOBAL CLASS B NOTE
	 EXHIBIT A-4A	 FORM OF DEFNITIVE GLOBAL CLASS C NOTE
	 EXHIBIT A-4B	 FORM OF GLOBAL CLASS C NOTE
	 EXHIBIT A-5A      	 FORM OF DEFINITIVE CLASS D NOTE
	 EXHIBIT B   	 FORM OF MONTHLY PAYMENT INSTRUCTIONS AND NOTIFICATION TO INDENTURE TRUSTEE
	 EXHIBIT C   	 FORM OF MONTHLY NOTEHOLDERS' STATEMENT
	 SCHEDULE I   	 PERFECTION COVENANTS

 

 

 

 

             

 

 

 

 

 

 

iii

  

    SERIES 2012-B INDENTURE SUPPLEMENT, dated as of July 19, 2012 (the “Indenture Supplement”), between WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST, a statutory trust organized and existing under the laws of the State of Delaware (herein, the “Issuer” or the “Trust”), and UNION BANK, N.A., a national banking association, not in its individual capacity, but solely as indenture trustee (herein, together with its successors in the trusts thereunder as provided in the Master Indenture referred to below, the “Indenture Trustee”) under the Master Indenture, dated as of August 1, 2001, between the Issuer and the Indenture Trustee, as amended by Omnibus Amendment, dated as of March 31, 2003, among WFN Credit Company, LLC (the “Transferor”), the Issuer, World Financial Network Bank, individually and as Servicer, World Financial Network Credit Card Master Trust, Union Bank, N.A. (successor to The Bank of New York Mellon Trust Company, N.A.), as trustee of World Financial Network Credit Card Master Trust and as Indenture Trustee, and as further amended by Supplemental Indenture No. 1 to Master Indenture, dated as of August 13, 2003, Supplemental Indenture No. 2 to Master Indenture, dated as of June 13, 2007, Supplemental Indenture No. 3 to Master Indenture, dated as of May 27, 2008, and Supplemental Indenture No. 4 to Master Indenture, dated as of June 28, 2011, each between the Issuer and the Indenture Trustee, and as supplemented by the Agreement of Resignation, Appointment and Acceptance, dated as of May 27, 2008, by and among the Administrator, the Issuer, BNY Midwest Trust Company (the successor in interest to the corporate trust administration of Harris Trust and Savings Bank), as resigning indenture trustee, and The Bank of New York Mellon Trust Company, N.A., as successor indenture trustee, and as further supplemented by the Agreement of Resignation, Appointment and Acceptance, dated as of June 26, 2012, by and among the Administrator, the Issuer, The Bank of New York Mellon Trust Company, N.A., as resigning indenture trustee, and Union Bank, N.A., as successor indenture trustee (as amended, the “Indenture”, and together with this Indenture Supplement, the “Agreement”).

 

Pursuant to Section 2.11 of the Indenture, the Transferor may direct the Owner Trustee, on behalf of the Issuer, to issue one or more Series of Notes.  The Principal Terms of this Series are set forth in this Indenture Supplement to the Indenture.

 

ARTICLE I.

 

 

Creation of the Series 2012-B Notes

 

Section 1.1                      Designation.

 

(a)           There is hereby created and designated a Series of Notes to be issued pursuant to the Indenture and this Indenture Supplement to be known as “World Financial Network Credit Card Master Note Trust, Series 2012-B” or the “Series 2012-B Notes.”  The Series 2012-B Notes shall be issued in five Classes, known as the “Class A Series 2012-B 1.76% Asset Backed Notes” (or the “Class A Fixed Rate Asset Backed Notes, Series 2012-B”), the “Class M Series 2012-B 3.25% Asset Backed Notes” (or the “Class M Fixed Rate Asset Backed Notes, Series 2012-B”), the “Class B Series 2012-B 3.50% Asset Backed Notes” (or the “Class B Fixed Rate Asset Backed Notes, Series 2012-B”), the “Class C Series 2012-B 4.50% Asset Backed Notes” (or the “Class C Fixed Rate Asset Backed Notes, Series 2012-B”) and the “Class D Series 2012-B 0.00% Asset Backed Notes” (or the “Class D Fixed Rate Asset Backed Notes, Series 2012-B”).

 

  

  

 

(b)           Series 2012-B shall be included in Group One and shall be a Principal Sharing Series.  Series 2012-B shall be an Excess Allocation Series with respect to Group One only.

 

(c)           The Series 2012-B Notes shall be issued in minimum denominations of $1,000 and in integral multiples of $1,000.

 

Section 1.2                      Transfer Restrictions.

 

(a)           The Class M Notes, Class B Notes, Class C Notes and Class D Notes have not been registered under the Securities Act or any state securities law.  None of the Issuer, the Note Registrar or the Indenture Trustee is obligated to register the Class M Notes, Class B Notes, Class C Notes or Class D Notes under the Securities Act or any other securities or “blue sky” laws or to take any other action not otherwise required under this Indenture Supplement or the Trust Agreement to permit the transfer of any Class M Note, Class B Note, Class C Note or Class D Note without registration.

 

(b)           Until such time as any such Class of Notes has been registered under the Securities Act and any applicable state securities law, the Class M Notes, Class B Notes, Class C Notes and Class D Notes may not be sold, transferred, assigned, participated, pledged or otherwise disposed of (any such act, a “Class M Note Transfer”, “Class B Note Transfer”, “Class C Note Transfer” or “Class D Note Transfer”, respectively) to any Person except in accordance with the provisions of this Section 1.2, and any attempted Class M Note Transfer, Class B Note Transfer, Class C Note Transfer or Class D Note Transfer in violation of this Section 1.2 will be null and void.

 

(c)           Each Class M Note, Class B Note, Class C Note and Class D Note will bear a legend to the effect of the following unless determined otherwise by the Administrator (as certified to the Indenture Trustee in an Officer’s Certificate) consistent with applicable law:

 

THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THE NEXT SENTENCE.  BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER OF THIS NOTE:

 

	
  

	
(1)

	
AGREES FOR THE BENEFIT OF THE ISSUER AND THE TRANSFEROR THAT THIS NOTE MAY BE SOLD, TRANSFERRED, ASSIGNED, PARTICIPATED, PLEDGED OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS, AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE l44A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE, OR OTHER

 

  

2

  

	
  

	 	
TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (II) TO THE TRANSFEROR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES; AND

 

	
  

	
(2)

	
AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

(d)           By acceptance of any Class M Note, Class B Note, Class C Note or Class D Note, the Class M Noteholder, Class B Noteholder, Class C Noteholder or Class D Noteholder, as applicable, specifically agrees with and represents to the Transferor, the Issuer and the Transfer Agent and Registrar, that no Class M Note Transfer, Class B Note Transfer, Class C Note Transfer or Class D Note Transfer will be made unless (i) the registration requirements of the Securities Act and any applicable state securities laws have been complied with, (ii) such Class M Note Transfer, Class B Note Transfer, Class C Note Transfer or Class D Note Transfer is to the Transferor or its Affiliates, or (iii) such Class M Note Transfer, Class B Note Transfer, Class C Note Transfer or Class D Note Transfer is exempt from the registration requirements under the Securities Act because such Class M Note Transfer, Class B Note Transfer, Class C Note Transfer or Class D Note Transfer, as applicable, is in compliance with Rule 144A under the Securities Act, to a transferee who the transferor reasonably believes is a “Qualified Institutional Buyer” (as defined in the Securities Act) that is purchasing for its own account or for the account of a Qualified Institutional Buyer and to whom notice is given that such Class M Note Transfer, Class B Note Transfer, Class C Note Transfer or Class D Note Transfer, as applicable, is being made in reliance upon Rule 144A under the Securities Act.

 

(e)           The Issuer will make available to the prospective transferor and transferee of a Class M Note, Class B Note, Class C Note and Class D Note information requested to satisfy the requirements of paragraph (d)(4) of Rule 144A.

 

(f)           All Transfers will be subject to the transfer restrictions set forth on the Notes.

 

(g)           Each Class A Note, Class M Note, Class B Note and Class C Note will bear a legend to the effect of the following unless determined otherwise by the Administrator (as certified to the Indenture Trustee in an Officer’s Certificate) consistent with applicable law:

 

BY YOUR ACQUISITION OF THIS NOTE OR ANY INTEREST HEREIN, YOU SHALL BE DEEMED TO REPRESENT, COVENANT AND AGREE, FOR THE BENEFIT OF THE ISSUER, THE INDENTURE TRUSTEE, THE UNDERWRITERS, THE SERVICER, WORLD FINANCIAL NETWORK BANK AND THE TRANSFEROR, THAT EITHER (A) YOU ARE NOT A BENEFIT PLAN (AS DEFINED BELOW) AND THAT YOU ARE NOT PURCHASING OR HOLDING SUCH NOTE OR ANY INTEREST HEREIN ON BEHALF OF, OR WITH THE ASSETS OF, A BENEFIT PLAN OR (B) YOUR PURCHASE, HOLDING AND DISPOSITION OF THIS NOTE OR INTEREST HEREIN WILL NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA (AS DEFINED BELOW),

 

  

3

  

SECTION 4975 OF THE CODE (AS DEFINED BELOW) OR ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW.  FOR THESE PURPOSES, A “BENEFIT PLAN” INCLUDES AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, A “PLAN” (AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF SUCH EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY OR ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION SECTIONS OF ERISA OR SECTION 4975 OF THE CODE.

 

(h)           Each Class D Note will bear a legend to the effect of the following unless determined otherwise by the Administrator (as certified to the Indenture Trustee in an Officer’s Certificate) consistent with applicable law:

 

BY YOUR ACQUISITION OF THIS NOTE OR ANY INTEREST HEREIN, YOU SHALL BE DEEMED TO REPRESENT, COVENANT AND AGREE, FOR THE BENEFIT OF THE ISSUER, THE INDENTURE TRUSTEE, THE SERVICER, WORLD FINANCIAL NETWORK BANK AND THE TRANSFEROR, THAT YOU ARE NOT A BENEFIT PLAN (AS DEFINED BELOW) AND THAT YOU ARE NOT PURCHASING OR HOLDING SUCH NOTE OR ANY INTEREST HEREIN ON BEHALF OF, OR WITH THE ASSETS OF, A BENEFIT PLAN.  FOR THESE PURPOSES, A “BENEFIT PLAN” INCLUDES AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, A “PLAN” (AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF SUCH EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY OR ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION SECTIONS OF ERISA OR SECTION 4975 OF THE CODE.

 

ARTICLE II.

 

 

Definitions

 

Section 2.1                      Definitions.

 

  

4

  

(a)           Whenever used in this Indenture Supplement, the following words and phrases shall have the following meanings, and the definitions of such terms are applicable to the singular as well as the plural forms of such terms and the masculine as well as the feminine and neuter genders of such terms.

 

“Accumulation Shortfall” means (a) for the first Distribution Date during the Controlled Accumulation Period, zero; and (b) thereafter, for any Distribution Date during the Controlled Accumulation Period, the excess, if any, of the Controlled Deposit Amount for the previous Distribution Date over the amount deposited into the Principal Accumulation Account pursuant to subsection 4.4(c)(i) for the previous Distribution Date.

 

“Additional Interest” means, for any Distribution Date, Class A Additional Interest, Class M Additional Interest, Class B Additional Interest, Class C Additional Interest and Class D Additional Interest for such Distribution Date.

 

“Additional Minimum Transferor Amount” means (a) as of any date of determination falling in November, December and January of each calendar year, the product of (i) 2% and (ii) the sum of (A) the Aggregate Principal Receivables and (B) if such date of determination occurs prior to the Certificate Trust Termination Date, the amount on deposit in the Excess Funding Account and (b) as of any date of determination falling in any other month, zero; provided that the amount specified in clause (a) shall be without duplication of the amount specified as the “Additional Minimum Transferor Amount” in any future supplement to the Pooling and Servicing Agreement that specifies such an amount and indicates that such amount is without duplication of the amount specified in clause (a) and in the Indenture Supplement relating to the Series 2006-A Notes, Series 2009-D Notes, Series 2010-A Notes, Series 2011-A Notes, Series 2011-B Notes, Series 2012-A Notes, Series 2012-C Notes or Series 2009-VFN Notes (or in any future Indenture Supplement that specifies such an amount and indicates that such amount is without duplication of the amount specified in clause (a)).  The Additional Minimum Transferor Amount is specified pursuant to Section 8.7 as an additional amount to be considered part of the Minimum Transferor Amount.

 

“Aggregate Investor Default Amount” means, as to any Monthly Period, the sum of the Investor Default Amounts in respect of such Monthly Period.

 

“Allocation Percentage” means, with respect to any Monthly Period, the percentage equivalent of a fraction:

 

(a)           the numerator of which shall be equal to:

 

(i)  (x) for Principal Collections for any Monthly Period (or portion thereof) during the Revolving Period and (y) for Finance Charge Collections and Default Amounts at any time, the Collateral Amount at the end of the last day of the prior Monthly Period (or, in the case of the Monthly Period in which the Closing Date occurs, on the Closing Date), less any reductions to be made to the Collateral Amount on account of principal payments or deposits to the Principal Accumulation Account to be made on the Distribution Date falling in the Monthly Period for which the Allocation Percentage is being calculated; or

 

  

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(ii)  for Principal Collections for any Monthly Period (or portion thereof) during the Early Amortization Period and the Controlled Accumulation Period, the Collateral Amount at the end of the last day of the Revolving Period, less, if sufficient funds have been deposited to a Trust Account to pay the outstanding principal amount of the 2012-B Notes in full on the Distribution Date falling in the Monthly Period for which the Allocation Percentage is being calculated, the aggregate amount of principal payments to be made on such final Distribution Date;

 

provided, however, that the Transferor may, by written notice to the Indenture Trustee, the Servicer and the Rating Agencies, reduce the numerator used for purposes of allocating Principal Collections to Series 2012-B at any time if (x) the Rating Agency Condition shall have been satisfied with respect to such reduction and (y) the Transferor shall have delivered to the Indenture Trustee an Officer’s Certificate to the effect, based on the facts known to such officer at that time, in the reasonable belief of the Transferor, such designation will not cause an Early Amortization Event or an event that, after the giving of notice or the lapse of time, would cause an Early Amortization Event to occur with respect to Series 2012-B; and

 

(b)           the denominator of which shall be the greater of (x) the Aggregate Principal Receivables determined as of the close of business on the last day of the prior Monthly Period and (y) the sum of the numerators used to calculate the allocation percentages for allocations with respect to Finance Charge Collections, Principal Collections or Default Amounts, as applicable, for all outstanding Series and all outstanding Series under (and as defined in) the Pooling and Servicing Agreement (other than any Series represented by the Collateral Certificate) on such date of determination; provided, that if one or more Reset Dates occur in a Monthly Period, the Allocation Percentage for the portion of the Monthly Period falling on and after such Reset Date and prior to any subsequent Reset Date will be recalculated for such period as of the close of business on the subject Reset Date.

 

“Available Finance Charge Collections” means, for any Monthly Period, an amount equal to the sum of (a) the Investor Finance Charge Collections for such Monthly Period, plus (b) the Excess Finance Charge Collections allocated to Series 2012-B for such Monthly Period, plus (c) Principal Accumulation Investment Proceeds, if any, with respect to the related Transfer Date, plus (d) interest and earnings on funds on deposit in the Reserve Account and Spread Account which will be deposited into the Finance Charge Account on the related Transfer Date to be treated as Available Finance Charge Collections pursuant to Sections 4.10(b) and 4.11(b), respectively, plus (e) amounts, if any, to be withdrawn from the Reserve Account which will be deposited into the Finance Charge Account on the related Transfer Date to be treated as Available Finance Charge Collections pursuant to Section 4.10(d).

 

“Available Principal Collections” means, for any Monthly Period, an amount equal to the sum of (a) the Investor Principal Collections for such Monthly Period, minus (b) the amount of Reallocated Principal Collections with respect to such Monthly Period which pursuant to Section 4.6 are required to be applied on the related Transfer Date, plus (c) any Shared Principal

 

  

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Collections with respect to other Principal Sharing Series (including any amounts on deposit in the Excess Funding Account that are allocated to Series 2012-B for application as Shared Principal Collections), plus (d) the aggregate amount to be treated as Available Principal Collections pursuant to subsections 4.4(a)(vi) and (vii) for the related Distribution Date.

 

“Available Reserve Account Amount” means, for any Transfer Date, the lesser of (a) the amount on deposit in the Reserve Account (after taking into account any interest and earnings retained in the Reserve Account pursuant to Section 4.10(b) on such date, but before giving effect to any deposit made or to be made pursuant to subsection 4.4(a)(ix) to the Reserve Account on such date) and (b) the Required Reserve Account Amount.

 

“Available Spread Account Amount” means, for any Transfer Date, an amount equal to the lesser of (a) the amount on deposit in the Spread Account (before giving effect to any deposit to, or withdrawal from, the Spread Account made or to be made with respect to such date) and (b) the Required Spread Account Amount, in each case on such Transfer Date.

 

“Base Rate” means, for any Monthly Period, the annualized percentage (based on a 360-day year of twelve 30-day months, or in the case of the initial Monthly Period, the actual number of days and a 360 day year) equivalent of a fraction, the numerator of which is equal to the sum of (x) the Monthly Interest and (y) the Noteholder Servicing Fee, each with respect to the related Distribution Date, and the denominator of which is the Collateral Amount plus amounts on deposit in the Principal Accumulation Account, each as of the close of business on the last day of such Monthly Period.

 

“Class A Additional Interest” is defined in Section 4.2(a).

 

“Class A Deficiency Amount” is defined in Section 4.2(a).

 

“Class A Monthly Interest” is defined in Section 4.2(a).

 

“Class A Note Initial Principal Balance” means $325,000,000.

 

“Class A Note Interest Rate” means a per annum rate of 1.76%.

 

“Class A Note Principal Balance” means, on any date of determination, an amount equal to (a) the Class A Note Initial Principal Balance, minus (b) the aggregate amount of principal payments made to the Class A Noteholders on or prior to such date.

 

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

 

“Class A Notes” means any one of the Notes executed by the Owner Trustee, on behalf of the Issuer, and authenticated by or on behalf of the Indenture Trustee, substantially in the form of Exhibit A-1.

 

“Class A Required Amount” means, for any Distribution Date, an amount equal to the excess of the amounts described in subsection 4.4(a)(i) over the amount of Available Finance Charge Collections applied to pay such amount pursuant to Section 4.4(a).

 

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        “Class B Additional Interest” is defined in Section 4.2(c).

 

“Class B Deficiency Amount” is defined in Section 4.2(c).

 

“Class B Monthly Interest” is defined in Section 4.2(c).

 

“Class B Note Initial Principal Balance” means $20,583,000.

 

“Class B Note Interest Rate” means a per annum rate of 3.50%.

 

“Class B Note Principal Balance” means, on any date of determination, an amount equal to (a) the Class B Note Initial Principal Balance, minus (b) the aggregate amount of principal payments made to the Class B Noteholders on or prior to such date.

 

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

 

“Class B Note Transfer” is defined in Section 1.2.

 

“Class B Notes” means any one of the Notes executed by the Owner Trustee, on behalf of the Issuer, and authenticated by or on behalf of the Indenture Trustee, substantially in the form of Exhibit A-3.

 

“Class B Required Amount” means, for any Distribution Date, an amount equal to the excess of the amount described in subsection 4.4(a)(iii) over the amount of Available Finance Charge Collections applied to pay such amount pursuant to Section 4.4(a).

 

“Class C Additional Interest” is defined in Section 4.2(d).

 

“Class C Deficiency Amount” is defined in Section 4.2(d).

 

“Class C Monthly Interest” is defined in Section 4.2(d).

 

“Class C Note Initial Principal Balance” means $54,167,000.

 

“Class C Note Interest Rate” means a per annum rate of 4.50%.

 

“Class C Note Principal Balance” means, on any date of determination, an amount equal to (a) the Class C Note Initial Principal Balance, minus (b) the aggregate amount of principal payments made to the Class C Noteholders on or prior to such date.

 

“Class C Noteholder” means the Person in whose name a Class C Note is registered in the Note Register.

 

“Class C Note Transfer” is defined in Section 1.2.

 

“Class C Notes” means any one of the Notes executed by the Owner Trustee, on behalf of the Issuer, and authenticated by or on behalf of the Indenture Trustee, substantially in the form of Exhibit A-4.

 

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“Class C Required Amount” means, for any Distribution Date, an amount equal to the excess of the amount described in subsection 4.4(a)(v) over the sum of the amount of Available Finance Charge Collections applied to pay such amount pursuant to Section 4.4(a) plus any amounts withdrawn from the Spread Account for such purpose.

 

“Class D Additional Interest” is defined in Section 4.2(e).

 

“Class D Deficiency Amount” is defined in Section 4.2(e).

 

“Class D Monthly Interest” is defined in Section 4.2(e).

 

“Class D Note Initial Principal Balance” means $17,334,000.

 

“Class D Note Interest Rate” means a per annum rate of 0.00%.

 

“Class D Note Principal Balance” means, on any date of determination, an amount equal to (a) the Class D Note Initial Principal Balance, minus (b) the aggregate amount of principal payments made to the Class D Noteholders on or prior to such date.

 

“Class D Noteholder” means the Person in whose name a Class D Note is registered in the Note Register.

 

“Class D Note Transfer” is defined in Section 1.2.

 

“Class D Notes” means any one of the Notes executed by the Owner Trustee, on behalf of the Issuer, and authenticated by or on behalf of the Indenture Trustee, substantially in the form of Exhibit A-5.

 

“Class M Additional Interest” is defined in Section 4.2(b).

 

“Class M Deficiency Amount” is defined in Section 4.2(b).

 

“Class M Monthly Interest” is defined in Section 4.2(b).

 

“Class M Note Initial Principal Balance” means $16,250,000.

 

“Class M Note Interest Rate” means a per annum rate of 3.25%.

 

“Class M Note Principal Balance” means, on any date of determination, an amount equal to (a) the Class M Note Initial Principal Balance, minus (b) the aggregate amount of principal payments made to the Class M Noteholders on or prior to such date.

 

“Class M Noteholder” means the Person in whose name a Class M Note is registered in the Note Register.

 

“Class M Note Transfer” is defined in Section 1.2.

 

  

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“Class M Notes” means any one of the Notes executed by the Owner Trustee, on behalf of the Issuer, and authenticated by or on behalf of the Indenture Trustee, substantially in the form of Exhibit A-2.

 

“Class M Required Amount” means, for any Distribution Date, an amount equal to the excess of the amount described in subsection 4.4(a)(ii) over the amount of Available Finance Charge Collections applied to pay such amount pursuant to Section 4.4(a).

 

“Closing Date” means July 19, 2012.

 

“Collateral Amount” means, as of any date of determination, an amount equal to the result of (a) Initial Collateral Amount, minus (b) the amount of principal previously paid to the Series 2012-B Noteholders (other than any principal payments made from funds on deposit in the Spread Account), minus (c) the balance on deposit in the Principal Accumulation Account, minus (d) the excess, if any, of the aggregate amount of Investor Charge-Offs and Reallocated Principal Collections over the reimbursements of such amounts pursuant to subsection 4.4(a)(vii) prior to such date; provided, that, the Collateral Amount will not be less than zero.

 

“Controlled Accumulation Amount” means, for any Transfer Date with respect to the Controlled Accumulation Period, the result of (rounded up to the nearest whole dollar) (i) the Note Principal Balance as of the last day of the Revolving Period divided by (ii) the Controlled Accumulation Period Length; provided, further, that the Controlled Accumulation Amount for any Distribution Date shall not exceed the Note Principal Balance minus any amount already on deposit in the Principal Accumulation Account on such Transfer Date.

 

“Controlled Accumulation Period” means, unless an Early Amortization Event shall have occurred prior thereto, the period commencing at the opening of business on July 1, 2016, or such later date as is determined in accordance with Section 4.13, and ending on the first to occur of (a) the commencement of the Early Amortization Period and (b) the Series Termination Date.

 

“Controlled Accumulation Period Length” is defined in Section 4.13.

 

“Controlled Deposit Amount” means, for any Transfer Date with respect to the Controlled Accumulation Period, an amount equal to the sum of the Controlled Accumulation Amount for such Transfer Date and any existing Accumulation Shortfall.

 

“Covered Amount” means an amount, determined as of each Transfer Date for any Distribution Period, equal to the sum of (a) the product of (i) the Class A Monthly Interest times (ii) a fraction, (A) the numerator of which is equal to the aggregate amount on deposit in the Principal Accumulation Account, up to the Class A Note Principal Balance as of the Record Date preceding such Transfer Date, and (B) the denominator of which is equal to the Class A Note Principal Balance as of the Record Date preceding such Transfer Date, plus (b) the product of (i) the Class M Monthly Interest times (ii) a fraction (A) the numerator of which is equal to the aggregate amount on deposit in the Principal Accumulation Account in excess of the Class A Note Principal Balance as of the Record Date preceding such Transfer Date, up to the Class M Note Principal Balance as of the Record Date preceding such Transfer Date, and (B) the denominator of which is equal to the Class M Note Principal Balance as of the Record Date preceding such Transfer Date, plus (c) the product of (i) the Class B Monthly Interest times (ii) a

 

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fraction (A) the numerator of which is equal to the aggregate amount on deposit in the Principal Accumulation Account in excess of the sum of the Class A Note Principal Balance and the Class M Note Principal Balance as of the Record Date preceding such Transfer Date, up to the Class B Note Principal Balance as of the Record Date preceding such Transfer Date, and (B) the denominator of which is equal to the Class B Note Principal Balance as of the Record Date preceding such Transfer Date, plus (d) the product of (i) the Class C Monthly Interest times (ii) a fraction (A) the numerator of which is equal to the aggregate amount on deposit in the Principal Accumulation Account in excess of the sum of the Class A Note Principal Balance, the Class M Note Principal Balance and the Class B Note Principal Balance, in each case as of the Record Date preceding such Transfer Date, up to the Class C Note Principal Balance as of the Record Date preceding such Transfer Date, and (B) the denominator of which is equal to the Class C Note Principal Balance as of the Record Date preceding such Transfer Date, plus (e) the product of (i) the Class D Monthly Interest times (ii) a fraction (A) the numerator of which is equal to the aggregate amount on deposit in the Principal Accumulation Account in excess of the sum of the Class A Note Principal Balance, the Class M Note Principal Balance, the Class B Note Principal Balance and the Class C Note Principal Balance, in each case as of the Record Date preceding such Transfer Date, up to the Class D Note Principal Balance as of the Record Date preceding such Transfer Date, and (B) the denominator of which is equal to the Class D Note Principal Balance as of the Record Date preceding such Transfer Date.

 

“Default Amount” means, as to any Defaulted Account, the amount of Principal Receivables (other than Ineligible Receivables, unless there is an Insolvency Event with respect to WFN or the Transferor) in such Defaulted Account on the day it became a Defaulted Account.

 

“Defaulted Account” means an Account in which there are Defaulted Receivables.

 

“Dilution” means any downward adjustment made by Servicer in the amount of any Receivable (a) because of a rebate, refund or billing error to an accountholder, (b) because such Receivable was created in respect of merchandise which was refused or returned by an accountholder or because such Receivable is an Excess Fraud Receivable or (c) for any other reason other than receiving Collections therefor or charging off such amount as uncollectible.

 

“Distribution Account” is defined in Section 4.9(a).

 

“Distribution Date” means August 15, 2012 and the 15th day of each calendar month thereafter, or if such 15th day is not a Business Day, the next succeeding Business Day.

 

“Distribution Period” means, for any Distribution Date, the period from and including the Distribution Date immediately preceding such Distribution Date (or, in the case of the first Distribution Date, from and including the Closing Date) to but excluding such Distribution Date.

 

“Early Amortization Period” means the period commencing on the date on which a Trust Early Amortization Event or a Series 2012-B Early Amortization Event is deemed to occur and ending on the Series Termination Date.

 

“Eligible Investments” is defined in Annex A to the Indenture; provided that references within clause (f) of the definition of “Eligible Investments” to the “highest investment category” of S&P shall mean AAAm and of Moody’s shall mean AAA-mf; provided further that solely for

 

  

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purposes of Section 4.11(b), references within the definition of “Eligible Investments” (other than with respect to clause (f) thereof) to the “highest investment category” of S&P shall mean A-2 and of Moody’s shall mean P-2.

 

 “Excess Spread Percentage” means, for any Monthly Period, a percentage equal to the Portfolio Yield for such Monthly Period, minus the Base Rate for such Monthly Period.

 

“Expected Principal Payment Date” means the July 2017 Distribution Date.

 

“Finance Charge Account” is defined in Section 4.9(a).

 

“Finance Charge Collections” means Collections of Finance Charge Receivables.

 

“Finance Charge Shortfall” is defined in Section 4.7.

 

“Group One” means Series 2006-A, Series 2009-D, Series 2010-A, Series 2011-A, Series 2011-B, Series 2012-A, Series 2012-B, Series 2012-C and Series 2009-VFN, the outstanding Series under (and as defined in) the Pooling and Servicing Agreement (other than Series represented by the Collateral Certificate) hereafter specified in the related supplement to the Pooling and Servicing Agreement to be included in Group One and each other Series hereafter specified in the related Indenture Supplement to be included in Group One.

 

“Initial Collateral Amount” means $433,334,000.

 

“Investment Earnings” means, for any Distribution Date, all interest and earnings on Eligible Investments included in the Spread Account (net of losses and investment expenses) during the period commencing on and including the Distribution Date immediately preceding such Distribution Date and ending on but excluding such Distribution Date.

 

“Investor Charge-Offs” is defined in Section 4.5.

 

“Investor Default Amount” means, with respect to any Defaulted Account, an amount equal to the product of (a) the Default Amount and (b) the Allocation Percentage on the day such Account became a Defaulted Account.

 

“Investor Finance Charge Collections” means, for any Monthly Period, an amount equal to the aggregate amount of Finance Charge Collections (including Net Recoveries treated as Finance Charge Collections) retained or deposited in the Finance Charge Account for Series 2012-B pursuant to subsection 4.1(b)(i) for such Monthly Period.

 

“Investor Principal Collections” means, for any Monthly Period, an amount equal to the aggregate amount of Principal Collections retained or deposited in the Principal Account for Series 2012-B pursuant to subsection 4.1(b)(ii) for such Monthly Period.

 

“Investor Uncovered Dilution Amount” means an amount equal to the product of (x) the Series Allocation Percentage for the related Monthly Period (determined on a weighted average basis, if one or more Reset Dates occur during that Monthly Period), times (y) the aggregate Dilutions occurring during that Monthly Period as to which any deposit is required to be made to

 

  

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the Excess Funding Account pursuant to Section 3.9(a) of the Transfer and Servicing Agreement or Section 3.9(a) of the Pooling and Servicing Agreement but has not been made; provided that, if the Transferor Amount is greater than zero at the time the deposit referred to in clause (y) is required to be made, the Investor Uncovered Dilution Amount for such amount to be deposited shall be deemed to be zero.

 

“Minimum Transferor Amount” means (a) prior to the Certificate Trust Termination Date, the “Minimum Transferor Amount” under (and as defined in) the Pooling and Servicing Agreement and (b) on and after the Certificate Trust Termination Date, the “Minimum Transferor Amount” as defined in Annex A to the Indenture.

 

“Monthly Interest” means, for any Distribution Date, the sum of the Class A Monthly Interest, the Class M Monthly Interest, the Class B Monthly Interest, the Class C Monthly Interest and the Class D Monthly Interest for such Distribution Date.

 

“Monthly Period” means the period from and including the first day of the calendar month preceding a related Distribution Date to and including the last day of such calendar month; provided that the Monthly Period related to the August 2012 Distribution Date shall mean the period from and including the Closing Date to and including the last day of July 2012.

 

“Monthly Principal” is defined in Section 4.3.

 

“Monthly Principal Reallocation Amount” means, for any Monthly Period, an amount equal to the sum of:

 

(a)  the lower of (i) the Class A Required Amount and (ii) the greater of (A)(x) the product of (I) 25.0% and (II) the Initial Collateral Amount minus (y) the amount of unreimbursed Investor Charge-Offs (after giving effect to Investor Charge-Offs for the related Monthly Period) and unreimbursed Reallocated Principal Collections (as of the previous Distribution Date) and (B) zero;

 

(b)  the lower of (i) the Class M Required Amount and (ii) the greater of (A)(x) the product of (I) 21.25% and (II) the Initial Collateral Amount minus (y) the amount of unreimbursed Investor Charge-Offs (after giving effect to Investor Charge-Offs for the related Monthly Period) and unreimbursed Reallocated Principal Collections (as of the previous Distribution Date and as required in clause (a) above) and (B) zero;

 

(c)  the lower of (i) the sum of the Class B Required Amount and the Servicing Fee Required Amount and (ii) the greater of (A)(x) the product of (I) 16.5% and (II) the Initial Collateral Amount minus (y) the amount of unreimbursed Investor Charge-Offs (after giving effect to Investor Charge-Offs for the related Monthly Period) and unreimbursed Reallocated Principal Collections (as of the previous Distribution Date and as required in clauses (a) and (b) above) and (B) zero;

 

(d)  the lower of (i) the Class C Required Amount and (ii) the greater of (A)(x) the product of (I) 4.0% and (II) the Initial Collateral Amount minus (y) the amount of unreimbursed Investor Charge-Offs (after giving effect to Investor Charge-Offs for the

 

  

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    related Monthly Period) and unreimbursed Reallocated Principal Collections (as of the previous Distribution Date and as required in clauses (a), (b) and (c) above) and (B) zero.

 

“Note Principal Balance” means, on any date of determination, an amount equal to the sum of the Class A Note Principal Balance, the Class M Note Principal Balance, the Class B Note Principal Balance, the Class C Note Principal Balance and the Class D Note Principal Balance.

 

“Noteholder Servicing Fee” is defined in Section 3.1.

 

“Percentage Allocation” is defined in subsection 4.1(b)(ii)(x).

 

“Potential Shortfall” is defined in subsection 4.1(b)(ii)(x).

 

 “Portfolio Yield” means, for any Monthly Period, the annualized percentage (based on a 360-day year of twelve 30-day months or, in the case of the initial Monthly Period, the actual number of days and a 360 day year) equivalent of a fraction, (a) the numerator of which is equal to (i) the Available Finance Charge Collections (excluding any Excess Finance Charge Collections), minus (ii) the Aggregate Investor Default Amount and the Investor Uncovered Dilution Amount for such Monthly Period and (b) the denominator of which is the Collateral Amount plus amounts on deposit in Principal Accumulation Account, each as of the close of business on the last day of such Monthly Period.

 

“Principal Account” is defined in Section 4.9(a).

 

“Principal Accumulation Account” is defined in Section 4.9(a).

 

“Principal Accumulation Account Balance” means, for any date of determination, the principal amount, if any, on deposit in the Principal Accumulation Account on such date of determination.

 

“Principal Accumulation Investment Proceeds” means, with respect to each Transfer Date, the investment earnings on funds in the Principal Accumulation Account (net of investment expenses and losses) for the period from and including the immediately preceding Transfer Date to but excluding such Transfer Date.

 

“Principal Collections” means Collections of Principal Receivables.

 

“Principal Shortfall” is defined in Section 4.8.

 

“Qualified Maturity Agreement” means an agreement whereby an Eligible Institution agrees to make a deposit into the Principal Accumulation Account on the Expected Principal Payment Date in an amount equal to the initial Note Principal Balance.

 

“Quarterly Excess Spread Percentage” means (a) with respect to the October 2012 Distribution Date, the percentage equivalent of a fraction the numerator of which is the sum of (i) the Excess Spread Percentage for the September 2012 Distribution Date and (ii) the Excess Spread Percentage with respect to the October 2012 Distribution Date and the denominator of which is two and (b) with respect to the November 2012 Distribution Date and each Distribution Date thereafter, the percentage equivalent of a fraction the numerator of which is the sum of the Excess Spread Percentages determined with respect to such Distribution Date and the immediately preceding two Distribution Dates and the denominator of which is three.

 

  

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“Rating Agency” means as of any date and with respect to any Class of the Series 2012-B Notes, the nationally recognized statistical rating organizations that have been requested by the Transferor to provide ratings of such class and that are rating the Series 2012-B Notes on such date.

 

“Rating Agency Condition” means, notwithstanding anything to the contrary in the Indenture, with respect to Series 2012-B and any action subject to such condition, (i) if Standard & Poor’s is a Rating Agency with respect to Series 2012-B, Standard & Poor’s shall have notified the Issuer in writing that such action will not result in a reduction or withdrawal of their respective ratings of any outstanding Class of Series 2012-B Notes and (ii) for any Rating Agency of the Series 2012-B Notes other than Standard & Poor’s, 10 days’ prior written notice (or, if 10 days’ advance notice is impracticable, as much advance notice as is practicable) to each Rating Agency delivered electronically to such email address as may be provided by the applicable Rating Agency.

 

“Reallocated Principal Collections” means, for any Transfer Date, Investor Principal Collections applied in accordance with Section 4.6 in an amount not to exceed the Monthly Principal Reallocation Amount for the related Monthly Period.

 

“Reassignment Amount” means, for any Transfer Date, after giving effect to any deposits and distributions otherwise to be made on the related Distribution Date, the sum of (i) the Note Principal Balance on the related Distribution Date, plus (ii) Monthly Interest for the related Distribution Date and any Monthly Interest previously due but not distributed to the Series 2012-B Noteholders, plus (iii) the amount of Additional Interest, if any, for the related Distribution Date and any Additional Interest previously due but not distributed to the Series 2012-B Noteholders on a prior Distribution Date.

 

“Required Principal Balance” means (a) prior to the Certificate Trust Termination Date, the “Required Principal Balance” under (and as defined in) the Pooling and Servicing Agreement and (b) on and after the Certificate Trust Termination Date, the “Required Principal Balance” as defined in Annex A to the Indenture.

 

“Required Reserve Account Amount” means, for any Transfer Date on or after the Reserve Account Funding Date, an amount equal to (a) 0.50% of the Note Principal Balance or (b) any other amount designated by the Transferor; provided, however, that if such designation is of a lesser amount, the Transferor shall (i) provide the Servicer and the Indenture Trustee with evidence that the Rating Agency Condition shall have been satisfied and (ii) deliver to the Indenture Trustee a certificate of an Authorized Officer to the effect that, based on the facts known to such officer at such time, in the reasonable belief of the Transferor, such designation will not cause an Early Amortization Event or an event that, after the giving of notice or the lapse of time, would cause an Early Amortization Event to occur with respect to Series 2012-B.

 

  

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“Required Retained Transferor Percentage” means, for purposes of Series 2012-B, 4.0%.

 

 “Required Spread Account Amount” means, for the October 2012 Distribution Date and each Distribution Date thereafter, (a) the product of (i) the Spread Account Percentage in effect on such date and (ii) during (x) the Revolving Period, the Collateral Amount, and (y) thereafter, the Collateral Amount as of the last day of the Revolving Period; provided that after the occurrence of an Event of Default resulting in acceleration of the Series 2012-B Notes, the Required Spread Account Amount shall equal the Note Principal Balance (after taking into account any payments to be made on such Distribution Date); and provided, further, that, except as described in the preceding proviso following the acceleration of the Series 2012-B Notes in no event will the Required Spread Account Amount exceed the Class C Note Principal Balance (after taking into account any payments to be made on such Distribution Date).

 

“Reserve Account” is defined in Section 4.10(a).

 

“Reserve Account Funding Date” means the Transfer Date designated by the Servicer which occurs not later than the Transfer Date with respect to the Monthly Period which commences 3 months prior to the commencement of the Controlled Accumulation Period (which commencement shall be subject to postponement pursuant to Section 4.13); provided, however, that subject to satisfaction of the Rating Agency Condition, the Reserve Account Funding Date may be any date selected by the Servicer.

 

“Reserve Account Surplus” means, as of any Transfer Date following the Reserve Account Funding Date, the amount, if any, by which the amount on deposit in the Reserve Account exceeds the Required Reserve Account Amount.

 

“Reserve Draw Amount” means, with respect to each Transfer Date relating to the Controlled Accumulation Period or the first Transfer Date relating to the Early Amortization Period, the amount, if any, by which the Principal Accumulation Investment Proceeds for such Distribution Date are less than the Covered Amount determined as of such Transfer Date.

 

“Reset Date” means:

 

(a)  each Addition Date and each “Addition Date” (as such term is defined in the Pooling and Servicing Agreement), in each case relating to Supplemental Accounts;

 

(b)  each Removal Date and each “Removal Date” (as such term is defined in the Pooling and Servicing Agreement) on which, if any Series of Notes or any Series under (and as defined in) the Pooling and Servicing Agreement has been paid in full, Principal Receivables equal to the Initial Collateral Amount for that Series are removed from the Receivables Trust;

 

(c)  each date on which there is an increase in the outstanding balance of any Variable Interest or “Variable Interest” (as such term is defined in the Pooling and Servicing Agreement); and

 

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(d)  each date on which a new Series, Class or subclass of Notes is issued and each date on which a new “Series” or “Class” (each as defined in the Pooling and Servicing Agreement) of investor certificates is issued by the Certificate Trust.

 

“Revolving Period” means the period beginning on the Closing Date and ending at the close of business on the day immediately preceding the earlier of the day the Controlled Accumulation Period commences or the day the Early Amortization Period commences.

 

“Series 2012-B” means the Series of Notes the terms of which are specified in this Indenture Supplement.

 

“Series 2012-B Early Amortization Event” is defined in Section 6.1.

 

“Series 2012-B Final Maturity Date” means the May 2021 Distribution Date.

 

“Series 2012-B Note” means a Class A Note, a Class M Note, a Class B Note, a Class C Note or a Class D Note.

 

“Series 2012-B Noteholder” means a Class A Noteholder, a Class M Noteholder, a Class B Noteholder, a Class C Noteholder or a Class D Noteholder.

 

“Series Account” means, (a) with respect to Series 2012-B, the Finance Charge Account, the Principal Account, the Principal Accumulation Account, the Distribution Account, the Reserve Account and the Spread Account and (b) with respect to any other Series, the “Series Accounts” for such Series as specified in the Indenture and the applicable Indenture Supplement for such Series.

 

“Series Allocation Percentage” means, with respect to any Monthly Period, the percentage equivalent of a fraction, the numerator of which is the Allocation Percentage for Finance Charge Collections for that Monthly Period and the denominator of which is the sum of the Allocation Percentages for Finance Charge Receivables for all outstanding Series on such date of determination; provided that if one or more Reset Dates occur in a Monthly Period, the Series Allocation Percentage for the portion of the Monthly Period falling on and after each such Reset Date and prior to any subsequent Reset Date will be determined using a denominator which is equal to the sum of the numerators used in determining the Allocation Percentage for Finance Charge Receivables for all outstanding Series as of the close of business on the subject Reset Date.

 

“Series Servicing Fee Percentage” means 2% per annum.

 

“Series Termination Date” means the earliest to occur of (a) the date on which the Note Principal Balance is paid in full, (b) the date on which the Collateral Amount is reduced to zero and (c) the Series 2012-B Final Maturity Date.

 

“Servicing Fee Required Amount” means, for any Distribution Date, an amount equal to the excess of the amount described in subsection 4.4(a)(iv) over the amount of the Available Finance Charge Collections applied to pay such amount pursuant to Section 4.4(a).

 

  

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“Specified Transferor Amount” means, at any time, the Minimum Transferor Amount (including the Additional Minimum Transferor Amount, if any) at that time.

 

“Spread Account” is defined in Section 4.11(a).

 

“Spread Account Deficiency” means the excess, if any, of the Required Spread Account Amount over the Available Spread Account Amount.

 

“Spread Account Percentage” means, for any Distribution Date, (i) 0.00% if the Quarterly Excess Spread Percentage on such Distribution Date is greater than or equal to 6.5%, (ii) 0.50% if the Quarterly Excess Spread Percentage on such Distribution Date is less than 6.5% and greater than or equal to 6.0%, (iii) 1.75% if the Quarterly Excess Spread Percentage on such Distribution Date is less than 6.0% and greater than or equal to 5.5%, (iv) 2.25% if the Quarterly Excess Spread Percentage on such Distribution Date is less than 5.5% and greater than or equal to 5.0%, (v) 2.75% if the Quarterly Excess Spread Percentage on such Distribution Date is less than 5.0% and greater than or equal to 4.5%, (vi) 3.25% if the Quarterly Excess Spread Percentage on such Distribution Date is less than 4.5% and greater than or equal to 4.0%, (vii) 3.75% if the Quarterly Excess Spread Percentage on such Distribution Date is less than 4.0% and greater than or equal to 3.0%, (viii) 4.25% if the Quarterly Excess Spread Percentage on such Distribution Date is less than 3.0% and greater than or equal to 2.5%, and (ix) 4.75% if the Quarterly Excess Spread Percentage on such Distribution Date is less than 2.5%; provided, that:

 

(a)  if the Spread Account Percentage for a Distribution Date is greater than 1.75%, then the Spread Account Percentage shall not decrease to a lower percentage until the first subsequent Distribution Date on which the arithmetic mean of the Quarterly Excess Spread Percentages for such subsequent Distribution Date and for the two Distribution Dates immediately prior to such subsequent Distribution Date is greater than or equal to the lowest Quarterly Excess Spread Percentage associated with a lower Spread Account Percentage;

 

(b)  if the Spread Account Percentage for a Distribution is equal to 1.75%, then the Spread Account Percentage shall not decrease to a lower percentage until the first subsequent Distribution Date on which the arithmetic mean of the Quarterly Excess Spread Percentages for such subsequent Distribution Date and for the Distribution Date immediately prior to such subsequent Distribution Date is greater than or equal to the lowest Quarterly Excess Spread Percentage associated with a lower Spread Account Percentage;

 

(c)  in no event will the Spread Account Percentage decrease by more than one of the levels specified above between any two Distribution Dates;1 and

 

(d)  if an Early Amortization Event is deemed to occur with respect to Series 2012-B, the Spread Account Percentage shall be 12.50%.

 

 

  

1 For example, if the Spread Account Percentage on one Distribution Date were 2.25%, then the Spread Account Percentage for the next Distribution Date could not be less than 1.75%, even if the Quarterly Excess Spread Percentage on such next Distribution Date were greater than or equal to 6.0%.

 

  

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“Target Amount” is defined in subsection 4.1(b)(i).

 

“Transfer” means any sale, transfer, assignment, exchange, participation, pledge, hypothecation, rehypothecation, or other grant of a security interest in or disposition of, a Note.

 

“Transferor Amount” means (a) prior to the Certificate Trust Termination Date, the “Transferor Amount” under (and as defined in) the Pooling and Servicing Agreement and (b) on and after the Certificate Trust Termination Date, the “Transferor Amount” as defined in Annex A to the Indenture.

 

(b)           Each capitalized term defined herein shall relate to the Series 2012-B Notes and no other Series of Notes issued by the Trust, unless the context otherwise requires.  All capitalized terms used herein and not otherwise defined herein have the meanings ascribed to them in Annex A to the Master Indenture.

 

(c)           The interpretive rules specified in Section 1.2 of the Master Indenture also apply to this Indenture Supplement.  If any term or provision contained herein shall conflict with or be inconsistent with any term or provision contained in the Master Indenture, the terms and provisions of this Indenture Supplement shall be controlling.

 

ARTICLE III.

 

 

Noteholder Servicing Fee

 

Section 3.1                      Servicing Compensation.  The share of the Servicing Fee allocable to Series 2012-B for any Transfer Date (the “Noteholder Servicing Fee”) shall be equal to one-twelfth of the product of (a) the Series Servicing Fee Percentage and (b) the Collateral Amount as of the last day of the Monthly Period preceding such Transfer Date; provided, however, that with respect to the first Transfer Date, the Noteholder Servicing Fee shall be equal to $288,889.33.  The remainder of the Servicing Fee shall be paid by the holders of the Transferor Interest or the noteholders of other Series (as provided in the related Indenture Supplements) and in no event shall the Trust, the Indenture Trustee or the Series 2012-B Noteholders be liable for the share of the Servicing Fee to be paid by the holders of the Transferor Interest or the noteholders of any other Series.

 

Section 3.2                      Covenants.  The parties hereto agree that the covenants set forth in Schedule I shall be a part of this Indenture Supplement for all purposes.

 

 

ARTICLE IV.

 

 

Rights of Series 2012-B Noteholders and Allocation and Application of Collections

 

Section 4.1                      Collections and Allocations

 

(a)           Allocations.  Finance Charge Collections, Principal Collections and Defaulted Receivables allocated to Series 2012-B pursuant to Article VIII of the Indenture shall be allocated and distributed as set forth in this Article.

 

 

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(b)           Allocations to the Series 2012-B Noteholders.  The Servicer shall on the Date of Processing, allocate to the Series 2012-B Noteholders the following amounts as set forth below:

 

(i)           Allocations of Finance Charge Collections. The Servicer shall allocate to the Series 2012-B Noteholders an amount equal to the product of (A) the Allocation Percentage and (B) the aggregate Finance Charge Collections processed on such Date of Processing and shall deposit such amount into the Finance Charge Account, provided that, with respect to each Monthly Period falling in the Revolving Period (and with respect to that portion of each Monthly Period in the Controlled Accumulation Period falling on or after the day on which Collections of Principal Receivables equal to the related Controlled Deposit Amount have been allocated pursuant to Section 4.1(b)(ii) and deposited pursuant to Section 4.1(c)), Collections of Finance Charge Receivables shall be transferred into the Finance Charge Account only until such time as the aggregate amount so deposited equals the sum (the “Target Amount”) of (A) the Monthly Interest for the related Distribution Date, (B) if WFN is not the Servicer, the Noteholder Servicing Fee (and if WFN is the Servicer, then amounts that otherwise would have been transferred into the Finance Charge Account pursuant to this clause (B) shall instead be returned to WFN as payment of the Noteholder Servicing Fee), (C) any amount required to be deposited in the Reserve Account and the Spread Account on the related Transfer Date and (D) the sum of 150% of the Investor Default Amounts from the prior Monthly Period and any Investor Uncovered Dilution Amounts from the prior Monthly Period; provided further, that, notwithstanding the preceding proviso, if on any Business Day the Servicer determines that the Target Amount for a Monthly Period exceeds the Target Amount for that Monthly Period as previously calculated by Servicer, then (x) Servicer shall (on the same Business Day) inform Transferor of such determination, and (y) within two Business Days of receiving such notice Transferor shall deposit into the Finance Charge Account funds in an amount equal to the amount of Collections of Finance Charge Receivables allocated to the Noteholders for that Monthly Period but not deposited into the Finance Charge Account due to the operation of the preceding proviso (but not in excess of the amount required so that the aggregate amount deposited for the subject Monthly Period equals the Target Amount); and provided, further, if on any Transfer Date the Transferor Amount is less than the Specified Transferor Amount after giving effect to all transfers and deposits on that Transfer Date, Transferor shall, on that Transfer Date, deposit into the Principal Account funds in an amount equal to the amounts of Available Finance Charge Collections that are required to be treated as Available Principal Collections pursuant to Section 4.4(a)(vi) and (vii) but are not available from funds in the Finance Charge Account as a result of the operation of the second preceding proviso.

 

With respect to any Monthly Period when deposits of Collections of Finance Charge Receivables into the Finance Charge Account are limited to deposits up to the Target Amount in accordance with clause (i) above, notwithstanding such limitation: (1) “Reallocated Principal Collections” for the related Transfer Date shall be calculated as if the full amount of Finance Charge Collections allocated to the Noteholders during that Monthly Period had been deposited in the Finance Charge Account and applied on such Transfer Date in accordance with Section 4.4(a); and (2) Collections of Finance Charge Receivables released to Transferor pursuant to such Section 4.1(b)(i) shall be deemed, for purposes of all calculations under this Indenture

 

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Supplement, to have been retained in the Finance Charge Account and applied to the items specified in Sections 4.4(a) to which such amounts would have been applied (and in the priority in which they would have been applied) had such amounts been available in the Finance Charge Account on such Transfer Date.  To avoid doubt, the calculations referred to in the preceding clause (2) include the calculations required by clause (d) of the definition of Collateral Amount and by the definition of Portfolio Yield.

 

(ii)           Allocations of Principal Collections.  The Servicer shall allocate to the Series 2012-B Noteholders the following amounts as set forth below:

 

(x)           Allocations During the Revolving Period.

 

(1)           During the Revolving Period an amount equal to the product of the Allocation Percentage and the aggregate amount of Principal Collections processed on such Date of Processing (the product for any such date is hereinafter referred to as a “Percentage Allocation”), shall be allocated to the Series 2012-B Noteholders and such amount shall be applied as follows: (I) first, if there shall not have been credited to the Finance Charge Account an amount equal to the sum of the Monthly Interest and, if the Bank is not the Servicer, the Noteholder Servicing Fee for such Monthly Period (the amount of any such shortfall in the Finance Charge Account being hereinafter referred to as the “Potential Shortfall”), transferred to the Principal Account in an amount equal to the amount of the Potential Shortfall, (II) second, if any other Principal Sharing Series is outstanding and in its accumulation period or amortization period, transferred to the Principal Account for application, to the extent necessary, as Shared Principal Collections to other Principal Sharing Series on the related Distribution Date, (III) third, deposited in the Excess Funding Account to the extent necessary so that the Transferor Amount is not less than the Specified Transferor Amount and (IV) fourth, paid to the holders of the Transferor Interest; provided that if on any date the aggregate amount transferred to the Principal Account in respect of clause (I) exceeds the Potential Shortfall, such excess amount shall be applied pursuant to clauses (II) through (IV) so that the amount credited to the Principal Account in respect of clause (I) equals the Potential Shortfall.

 

(2)           With respect to each Monthly Period falling in the Revolving Period, to the extent that Collections of Principal Receivables allocated to the Series 2012-B Noteholders pursuant to this subsection 4.1(b)(ii) are paid to Transferor, Transferor shall make an amount equal to the Reallocated Principal Collections for the related Transfer Date available on that Transfer Date for application in accordance with Section 4.6.

 

(y)           Allocations During the Controlled Accumulation Period.  During the Controlled Accumulation Period an amount equal to the Percentage Allocation shall be allocated to the Series 2012-B Noteholders and such amount shall be applied as follows: (I) first, if there is a Potential Shortfall, transferred to the Principal Account in an amount equal to the amount of the Potential Shortfall, (II) second, transferred to the Principal Account until the sum of the portion of such

 

  

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Percentage Allocation and all preceding Percentage Allocations with respect to the same Monthly Period that have been transferred to the Principal Account for such purpose equals the Controlled Deposit Amount for the related Distribution Date, (III) third, if any other Principal Sharing Series is outstanding and in its accumulation period or amortization period, transferred to the Principal Account for application, to the extent necessary, as Shared Principal Collections to other Principal Sharing Series on the related Distribution Date, (IV) fourth, deposited in the Excess Funding Account to the extent necessary so that the Transferor Amount is not less than the Specified Transferor Amount and (V) fifth, paid to the holders of the Transferor Interest; provided that if on any date the aggregate amount transferred to the Principal Account in respect of clause (I) exceeds the Potential Shortfall, such excess amount shall be applied pursuant to clauses (II) through (V) so that the amount credited to the Principal Account in respect of clause (I) equals the Potential Shortfall.

 

    (z)           Allocations During the Early Amortization Period.  During the Early Amortization Period, an amount equal to the Percentage Allocation shall be allocated to the Series 2012-B Noteholders and applied as follows: (I) first, if there is a Potential Shortfall, transferred to the Principal Account in an amount equal to the amount of the Potential Shortfall, (II) second, transferred to the Principal Account until the sum of the portion of such Percentage Allocation and all preceding Percentage Allocations that have been transferred to the Principal Account for such purpose equals the Note Principal Balance; (III) third, if any other Principal Sharing Series is outstanding and in its accumulation period or amortization period, transferred to the Principal Account for application, to the extent necessary, as Shared Principal Collections to other Principal Sharing Series on the related Distribution Date, (IV) fourth, deposited in the Excess Funding Account to the extent necessary so that the Transferor Amount is not less than the Specified Transferor Amount and (V) fifth, paid to the holders of the Transferor Interest; provided that if on any date the aggregate amount transferred to the Principal Account in respect of clause (I) exceeds the Potential Shortfall, such excess amount shall be applied pursuant to clauses (II) through (V) so that the amount credited to the Principal Account in respect of clause (I) equals the Potential Shortfall.

 

(c)           During any period when Servicer is permitted by Section 4.3 of the Pooling and Servicing Agreement or Section 8.4 of the Indenture to make a single monthly deposit to the Collection Account, amounts allocated to the Noteholders pursuant to Sections 4.1(a) and (b) with respect to any Monthly Period need not be deposited into the Collection Account or any Series Account prior to the related Transfer Date, and, when so deposited, (x) may be deposited net of any amounts required to be distributed to Transferor and, if WFN is Servicer, Servicer, and (y) shall be deposited into the Finance Charge Account (in the case of Collections of Finance Charge Receivables) and the Principal Account (in the case of Collections of Principal Receivables (not including any Shared Principal Collections allocated to Series 2012-B pursuant to Section 4.15 of the Pooling and Servicing Agreement or Section 8.5 of the Indenture)).

 

  

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(d)           On any date, Servicer may withdraw from the Collection Account or any Series Account any amounts inadvertently deposited in such account that should have not been so deposited.

 

 

 

Section 4.2                      Determination of Monthly Interest.

 

(a)           The amount of monthly interest (“Class A Monthly Interest”) distributable from the Distribution Account with respect to the Class A Notes on any Distribution Date shall be an amount equal to the product of (i) (A) a fraction, the numerator of which is 30 and the denominator of which is 360, times (B) the Class A Note Interest Rate in effect with respect to the related Distribution Period and (ii) the Class A Note Principal Balance as of the close of business on the last day of the preceding Monthly Period (or, with respect to the initial Distribution Date, the Class A Note Initial Principal Balance); provided that the Class A Monthly Interest for the August 2012 Distribution Date shall be $413,111.11.

 

On the Determination Date preceding each Distribution Date, the Servicer shall determine the excess, if any (the “Class A Deficiency Amount”), of (x) the aggregate amount accrued pursuant to this Section 4.2(a) as of the prior Distribution Date over (y) the amount actually transferred from the Distribution Account for payment of such amount.  If the Class A Deficiency Amount for any Distribution Date is greater than zero, on each subsequent Distribution Date until such Class A Deficiency Amount is fully paid, an additional amount (“Class A Additional Interest”) equal to the product of (i) (A) a fraction, the numerator of which is 30 and the denominator of which is 360, times (B) the Class A Note Interest Rate in effect with respect to the related Distribution Period plus 2% per annum and (ii) such Class A Deficiency Amount (or the portion thereof which has not been paid to the Class A Noteholders) shall be payable as provided herein with respect to the Class A Notes.  Notwithstanding anything to the contrary herein, Class A Additional Interest shall be payable or distributed to the Class A Noteholders only to the extent permitted by applicable law.

 

(b)           The amount of monthly interest (“Class M Monthly Interest”) distributable from the Distribution Account with respect to the Class M Notes on any Distribution Date shall be an amount equal to the product of (i) (A) a fraction, the numerator of which is 30 and the denominator of which is 360, times (B) the Class M Note Interest Rate in effect with respect to the related Distribution Period and (ii) the Class M Note Principal Balance as of the close of business on the last day of the preceding Monthly Period (or, with respect to the initial Distribution Date, the Class M Note Initial Principal Balance); provided that the Class M Monthly Interest for the August 2012 Distribution Date shall be $38,142.36.

 

On the Determination Date preceding each Distribution Date, the Servicer shall determine the excess, if any (the “Class M Deficiency Amount”), of (x) the aggregate amount accrued pursuant to this Section 4.2(b) as of the prior Distribution Date over (y) the amount of funds actually transferred from the Distribution Account for payment of such amount.  If the Class M Deficiency Amount for any Distribution Date is greater than zero, on each subsequent Distribution Date until such Class M Deficiency Amount is fully paid, an additional amount (“Class M Additional Interest”) equal to the product of (i) (A) a fraction, the numerator of which is 30 and the denominator of which is 360, times (B) the Class M Note Interest Rate in effect with respect to the related Distribution Period plus 2% per annum and (ii) such Class M

  

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Deficiency Amount (or the portion thereof which has not been paid to the Class M Noteholders) shall be payable as provided herein with respect to the Class M Notes.  Notwithstanding anything to the contrary herein, Class M Additional Interest shall be payable or distributed to the Class M Noteholders only to the extent permitted by applicable law.

 

(c)           The amount of monthly interest (“Class B Monthly Interest”) distributable from the Distribution Account with respect to the Class B Notes on any Distribution Date shall be an amount equal to the product of (i) (A) a fraction, the numerator of which is 30 and the denominator of which is 360, times (B) the Class B Note Interest Rate in effect with respect to the related Distribution Period and (ii) the Class B Note Principal Balance as of the close of business on the last day of the preceding Monthly Period (or, with respect to the initial Distribution Date, the Class B Note Initial Principal Balance); provided that the Class B Monthly Interest for the August 2012 Distribution Date shall be $52,029.25.

 

On the Determination Date preceding each Distribution Date, the Servicer shall determine the excess, if any (the “Class B Deficiency Amount”), of (x) the aggregate amount accrued pursuant to this Section 4.2(c) as of the prior Distribution Date over (y) the amount of funds actually transferred from the Distribution Account for payment of such amount.  If the Class B Deficiency Amount for any Distribution Date is greater than zero, on each subsequent Distribution Date until such Class B Deficiency Amount is fully paid, an additional amount (“Class B Additional Interest”) equal to the product of (i) (A) a fraction, the numerator of which is 30 and the denominator of which is 360, times (B) the Class B Note Interest Rate in effect with respect to the related Distribution Period plus 2% per annum and (ii) such Class B Deficiency Amount (or the portion thereof which has not been paid to the Class B Noteholders) shall be payable as provided herein with respect to the Class B Notes.  Notwithstanding anything to the contrary herein, Class B Additional Interest shall be payable or distributed to the Class B Noteholders only to the extent permitted by applicable law.

 

(d)           The amount of monthly interest (“Class C Monthly Interest”) distributable from the Distribution Account with respect to the Class C Notes on any Distribution Date shall be an amount equal to the product of (i) (A) a fraction, the numerator of which is 30 and the denominator of which is 360, times (B) the Class C Note Interest Rate in effect with respect to the related Distribution Period and (ii) the Class C Note Principal Balance as of the close of business on the last day of the preceding Monthly Period (or, with respect to the initial Distribution Date, the Class C Note Initial Principal Balance); provided that the Class C Monthly Interest for the August 2012 Distribution Date shall be $176,042.75.

 

On the Determination Date preceding each Distribution Date, the Servicer shall determine the excess, if any (the “Class C Deficiency Amount”), of (x) the aggregate amount accrued pursuant to this Section 4.2(d) as of the prior Distribution Date over (y) the amount of funds actually transferred from the Distribution Account for payment of such amount.  If the Class C Deficiency Amount for any Distribution Date is greater than zero, on each subsequent Distribution Date until such Class C Deficiency Amount is fully paid, an additional amount (“Class C Additional Interest”) equal to the product of (i) (A) a fraction, the numerator of which is 30 and the denominator of which is 360, times (B) the Class C Note Interest Rate in effect with respect to the related Distribution Period plus 2% per annum and (ii) such Class C Deficiency Amount (or the portion thereof which has not been paid to the Class C Noteholders) shall be

 

  

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payable as provided herein with respect to the Class C Notes.  Notwithstanding anything to the contrary herein, Class C Additional Interest shall be payable or distributed to the Class C Noteholders only to the extent permitted by applicable law.

 

(e)           The amount of monthly interest (“Class D Monthly Interest”) distributable from the Distribution Account with respect to the Class D Notes on any Distribution Date shall be an amount equal to the product of (i) (A) a fraction, the numerator of which is 30 and the denominator of which is 360, times (B) the Class D Note Interest Rate in effect with respect to the related Distribution Period and (ii) the Class D Note Principal Balance as of the close of business on the last day of the preceding Monthly Period (or, with respect to the initial Distribution Date, the Class D Note Initial Principal Balance); provided that the Class D Monthly Interest for the August 2012 Distribution Date shall be $0.00.

 

On the Determination Date preceding each Distribution Date, the Servicer shall determine the excess, if any (the “Class D Deficiency Amount”), of (x) the aggregate amount accrued pursuant to this Section 4.2(e) as of the prior Distribution Date over (y) the amount of funds actually transferred from the Distribution Account for payment of such amount.  If the Class D Deficiency Amount for any Distribution Date is greater than zero, on each subsequent Distribution Date until such Class D Deficiency Amount is fully paid, an additional amount (“Class D Additional Interest”) equal to the product of (i) (A) a fraction, the numerator of which is 30 and the denominator of which is 360, times (B) the Class D Note Interest Rate in effect with respect to the related Distribution Period plus 2% per annum and (ii) such Class D Deficiency Amount (or the portion thereof which has not been paid to the Class D Noteholders) shall be payable as provided herein with respect to the Class D Notes.  Notwithstanding anything to the contrary herein, Class D Additional Interest shall be payable or distributed to the Class D Noteholders only to the extent permitted by applicable law.

 

Section 4.3                      Determination of Monthly Principal.  The amount of monthly principal to be transferred from the Principal Account with respect to the Notes on each Transfer Date (the “Monthly Principal”), beginning with the Transfer Date in the month following the month in which the Controlled Accumulation Period or, if earlier, the Early Amortization Period, begins, shall be equal to the least of (i) the Available Principal Collections on deposit in the Principal Account with respect to such Transfer Date, (ii) for each Transfer Date with respect to the Controlled Accumulation Period, the Controlled Deposit Amount for such Transfer Date, (iii) the Collateral Amount (after taking into account any adjustments to be made on such Distribution Date pursuant to Sections 4.5 and 4.6) prior to any deposit into the Principal Accumulation Account on such Transfer Date, and (iv) the Note Principal Balance, minus any amount already on deposit in the Principal Accumulation Account on such Transfer Date.

 

Section 4.4                      Application of Available Finance Charge Collections and Available Principal Collections.  On or before each Transfer Date, the Servicer shall instruct the Indenture Trustee in writing (which writing shall be substantially in the form of Exhibit B) to withdraw and the Indenture Trustee, acting in accordance with such instructions, shall withdraw on such Transfer Date or related Distribution Date, as applicable, to the extent of available funds, the amount required to be withdrawn from the Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account as follows:

 

  

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(a)           On each Transfer Date, an amount equal to the Available Finance Charge Collections with respect to the related Distribution Date will be distributed or deposited in the following priority:

 

(i)           an amount equal to Class A Monthly Interest for such Distribution Date, plus any Class A Deficiency Amount, plus the amount of any Class A Additional Interest for such Distribution Date, plus the amount of any Class A Additional Interest previously due but not distributed to Class A Noteholders on a prior Distribution Date shall be deposited by the Servicer or Indenture Trustee into the Distribution Account;

 

(ii)           an amount equal to Class M Monthly Interest for such Distribution Date, plus any Class M Deficiency Amount, plus the amount of any Class M Additional Interest for such Distribution Date, plus the amount of any Class M Additional Interest previously due but not distributed to Class M Noteholders on a prior Distribution Date shall be deposited by the Servicer or Indenture Trustee into the Distribution Account;

 

(iii)           an amount equal to Class B Monthly Interest for such Distribution Date, plus any Class B Deficiency Amount, plus the amount of any Class B Additional Interest for such Distribution Date, plus the amount of any Class B Additional Interest previously due but not distributed to Class B Noteholders on a prior Distribution Date shall be deposited by the Servicer or Indenture Trustee into the Distribution Account;

 

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

 

(v)           an amount equal to Class C Monthly Interest for such Distribution Date, plus any Class C Deficiency Amount, plus the amount of any Class C Additional Interest for such Distribution Date, plus the amount of any Class C Additional Interest previously due but not distributed to the Class C Noteholders on a prior Distribution Date shall be deposited by the Servicer or Indenture Trustee into the Distribution Account;

 

(vi)           an amount equal to the Aggregate Investor Default Amount and any Investor Uncovered Dilution Amount for such Distribution Date shall be treated as a portion of Available Principal Collections for such Distribution Date and, during the Controlled Accumulation Period or the Early Amortization Period, deposited into the Principal Account on the related Transfer Date;

 

(vii)           an amount equal to the sum of the aggregate amount of Investor Charge-Offs and the amount of Reallocated Principal Collections which have not been previously reimbursed pursuant to this subsection (vii) shall be treated as a portion of Available Principal Collections for such Distribution Date;

 

(viii)           an amount equal to Class D Monthly Interest for such Distribution Date, plus any Class D Deficiency Amount, plus the amount of any Class D Additional Interest for such Distribution Date, plus the amount of any Class D Additional Interest previously due but not distributed to the Class D Noteholders on a prior Distribution Date shall be deposited by the Servicer or Indenture Trustee into the Distribution Account;

 

  

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(ix)           on each Transfer Date from and after the Reserve Account Funding Date, but prior to the date on which the Reserve Account terminates as described in Section 4.10(f), an amount equal to the excess, if any, of the Required Reserve Account Amount over the Available Reserve Account Amount shall be deposited into the Reserve Account as provided in Section 4.10(a);

 

(x)           an amount equal to the amounts required to be deposited in the Spread Account pursuant to Section 4.11(f) shall be deposited into the Spread Account as provided in Section 4.11(f);

 

(xi)           any amounts designated in writing by the Transferor to the Servicer and Indenture Trustee as amounts to be paid from Available Finance Charge Collections shall be paid in accordance with the Transferor’s instructions; and

 

(xii)           the balance, if any, will constitute a portion of Excess Finance Charge Collections for such Distribution Date.

 

(b)           On each Transfer Date with respect to the Revolving Period, an amount equal to the Available Principal Collections for the related Monthly Period shall be treated as Shared Principal Collections and applied in accordance with Section 8.5 of the Indenture.

 

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

 

(i)           during the Controlled Accumulation Period, an amount equal to the Monthly Principal for such Transfer Date shall be deposited into the Principal Accumulation Account;

 

(ii)           during the Early Amortization Period, an amount equal to the Monthly Principal for such Transfer Date shall be deposited into the Distribution Account on such Transfer Date and on each subsequent Transfer Date for payment to the Class A Noteholders on the related Distribution Date until the Class A Note Principal Balance has been paid in full;

 

(iii)           during the Early Amortization Period, after giving effect to the distribution referred to in clause (ii) above, an amount equal to the Monthly Principal remaining, if any, shall be deposited into the Distribution Account on such Transfer Date and on each subsequent Transfer Date for payment to the Class M Noteholders on the related Distribution Date until the Class M Note Principal Balance has been paid in full;

 

(iv)           during the Early Amortization Period, after giving effect to the distribution referred to in clauses (ii) and (iii) above, an amount equal to the Monthly Principal remaining, if any, shall be deposited into the Distribution Account on such Transfer Date and on each subsequent Transfer Date for payment to the Class B Noteholders on the related Distribution Date until the Class B Note Principal Balance has been paid in full;

 

  

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(v)           during the Early Amortization Period, after giving effect to the distributions referred to in clauses (ii) through (iv) above, an amount equal to the Monthly Principal remaining, if any, shall be deposited into the Distribution Account on such Transfer Date and on each subsequent Transfer Date for payment to the Class C Noteholders on the related Distribution Date until the Class C Note Principal Balance has been paid in full;

 

(vi)           during the Early Amortization Period, after giving effect to the distributions referred to in clauses (ii) through (v) above, an amount equal to the Monthly Principal remaining, if any, shall be deposited into the Distribution Account on such Transfer Date and on each subsequent Transfer Date for payment to the Class D Noteholders on the related Distribution Date until the Class D Note Principal Balance has been paid in full; and

 

(vii)           in the case of each of the Controlled Accumulation Period and the Early Amortization Period, the balance of such Available Principal Collections remaining after application in accordance with clauses (i) through (vi) above shall be treated as Shared Principal Collections and applied in accordance with Section 8.5 of the Indenture.

 

(d)           On each Distribution Date, the Indenture Trustee shall pay in accordance with Section 5.2 to the Class A Noteholders from the Distribution Account, the amount deposited into the Distribution Account pursuant to Section 4.4(a)(i) on the preceding Transfer Date, to the Class M Noteholders from the Distribution Account, the amount deposited into the Distribution Account pursuant to Section 4.4(a)(ii) on the preceding Transfer Date, to the Class B Noteholders from the Distribution Account, the amount deposited into the Distribution Account pursuant to Section 4.4(a)(iii) on the preceding Transfer Date, to the Class C Noteholders from the Distribution Account, the amount deposited into the Distribution Account pursuant to Section 4.4(a)(v) on the preceding Transfer Date and to the Class D Noteholders from the Distribution Account, the amount deposited into the Distribution Account pursuant to Section 4.4(a)(viii) on the preceding Transfer Date.

 

(e)           On the earlier to occur of (i) the first Transfer Date with respect to the Early Amortization Period and (ii) the Transfer Date immediately preceding the Expected Principal Payment Date, the Indenture Trustee, acting in accordance with instructions from the Servicer, shall withdraw from the Principal Accumulation Account and deposit into the Distribution Account amounts necessary to pay first, to the Class A Noteholders, an amount equal to the Class A Note Principal Balance, second, to the Class M Noteholders, an amount equal to the Class M Note Principal Balance, third, to the Class B Noteholders, an amount equal to the Class B Note Principal Balance, fourth, to the Class C Noteholders, an amount equal to the Class C Note Principal Balance and fifth, to the Class D Noteholders, an amount equal to the Class D Note Principal Balance.  The Indenture Trustee, acting in accordance with the instructions of the Servicer, shall in accordance with Section 5.2 pay from the Distribution Account to the Class A Noteholders, the Class M Noteholders, the Class B Noteholders, the Class C Noteholders and the Class D Noteholders, as applicable, the amounts deposited for the account of such Noteholders into the Distribution Account pursuant to this Section 4.4(e).

 

  

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       Section 4.5                      Investor Charge-Offs.  On each Determination Date, the Servicer shall calculate the Aggregate Investor Default Amount and any Investor Uncovered Dilution Amount for the related Distribution Date.  If, on any Distribution Date, the sum of the Aggregate Investor Default Amount and any Investor Uncovered Dilution Amount for such Distribution Date exceeds the amount of Available Finance Charge Collections allocated with respect thereto pursuant to subsection 4.4(a)(vi) with respect to such Distribution Date, the Collateral Amount will be reduced (but not below zero) by the amount of such excess (such reduction, an “Investor Charge-Off”).

 

Section 4.6                      Reallocated Principal Collections.  On each Transfer Date, the Servicer shall apply, or shall instruct the Indenture Trustee in writing to apply, Reallocated Principal Collections with respect to that Transfer Date, to fund any deficiency pursuant to and in the priority set forth in subsections 4.4(a)(i), (ii), (iii), (iv) and (v), after giving effect to any withdrawal from the Spread Account to cover such payments.  On each Transfer Date, the Collateral Amount shall be reduced (but not below zero) by the amount of Reallocated Principal Collections for such Transfer Date.

 

Section 4.7                      Excess Finance Charge Collections.  Series 2012-B shall be an Excess Allocation Series with respect to Group One only.  For this purpose, each outstanding series of certificates issued by World Financial Network Master Trust (other than series represented by the Collateral Certificate) shall be deemed to be a Series in Group One. Subject to Section 8.6 of the Indenture, Excess Finance Charge Collections with respect to the Excess Allocation Series in Group One for any Transfer Date will be allocated to Series 2012-B in an amount equal to the product of (x) the aggregate amount of Excess Finance Charge Collections with respect to all the Excess Allocation Series in Group One for such Distribution Date and (y) a fraction, the numerator of which is the Finance Charge Shortfall for Series 2012-B for such Distribution Date and the denominator of which is the aggregate amount of Finance Charge Shortfalls for all the Excess Allocation Series in Group One for such Distribution Date.  The “Finance Charge Shortfall” for Series 2012-B for any Distribution Date will be equal to the excess, if any, of (a) the full amount required to be paid, without duplication, pursuant to subsections 4.4(a)(i) through (xi) on such Distribution Date over (b) the Available Finance Charge Collections with respect to such Distribution Date (excluding any portion thereof attributable to Excess Finance Charge Collections).

 

Section 4.8                      Shared Principal Collections.  Subject to Section 4.4 of the Pooling and Servicing Agreement and Section 8.5 of the Indenture, Shared Principal Collections allocable to Series 2012-B on any Transfer Date will be equal to the product of (x) the aggregate amount of Shared Principal Collections with respect to all Principal Sharing Series for such Transfer Date and (y) a fraction, the numerator of which is the Principal Shortfall for Series 2012-B for such Transfer Date and the denominator of which is the aggregate amount of Principal Shortfalls for all the Series which are Principal Sharing Series for such Transfer Date.  For this purpose, each outstanding series of certificates issued by World Financial Network Master Trust (other than series represented by the Collateral Certificate) shall be deemed to be a Principal Sharing Series.  The “Principal Shortfall” for Series 2012-B will be equal to (a) for any Transfer Date with respect to the Revolving Period or any Transfer Date during the Early Amortization Period prior to the earlier of (i) the Expected Principal Payment Date and (ii) the date on which all outstanding Series are in early amortization periods, zero, (b) for any Transfer Date with respect

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to the Controlled Accumulation Period, the excess, if any, of the Controlled Deposit Amount with respect to such Transfer Date over the amount of Available Principal Collections for such Transfer Date (excluding any portion thereof attributable to Shared Principal Collections) and (c) for any Transfer Date on or after the earlier of (i) the Expected Principal Payment Date and (ii) the date on which all outstanding Series are in early amortization periods, the Note Principal Balance.

 

Section 4.9                      Certain Series Accounts.

 

(a)           The Indenture Trustee shall establish and maintain with an Eligible Institution, which may be the Indenture Trustee in the name of the Trust, on behalf of the Trust, for the benefit of the Series 2012-B Noteholders, four segregated trust accounts (the “Finance Charge Account”, the “Principal Account”, the “Principal Accumulation Account” and the “Distribution Account”).  The Principal Account, the Principal Accumulation Account and the Distribution Account shall bear a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2012-B Noteholders.  The Finance Charge Account shall bear a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2012-B Noteholders.  The Indenture Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account and in all proceeds thereof.  The Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Series 2012-B Noteholders.  If at any time the institution holding the Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account ceases to be an Eligible Institution, the Transferor shall notify the Indenture Trustee in writing, and the Indenture Trustee upon being notified (or the Servicer on its behalf) shall, within ten (10) Business Days, establish a new Finance Charge Account, a new Principal Account, a new Principal Accumulation Account and a new Distribution Account meeting the conditions specified above with an Eligible Institution, and shall transfer any cash or any investments to such new Finance Charge Account, new Principal Account, new Principal Accumulation Account and new Distribution Account.  The Indenture Trustee, at the written direction of the Servicer, shall (i) make withdrawals from the Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account from time to time, in the amounts and for the purposes set forth in this Indenture Supplement, and (ii) on each Transfer Date (from and after the commencement of the Controlled Accumulation Period) prior to the termination of the Principal Accumulation Account, make deposits into the Principal Accumulation Account in the amounts specified in, and otherwise in accordance with, subsection 4.4(c)(i).  Indenture Trustee at all times shall maintain accurate records reflecting each transaction in the Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account.

 

(b)           Funds on deposit in the Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account, from time to time shall be invested and reinvested at the direction of the Servicer by the Indenture Trustee in Eligible Investments that will mature so that such funds will be available for withdrawal on or prior to the following Transfer Date.

 

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On each Transfer Date with respect to the Controlled Accumulation Period and on the first Transfer Date with respect to the Early Amortization Period, the Indenture Trustee, acting at the Servicer’s direction given on or before such Transfer Date, shall transfer from the Principal Accumulation Account to the Finance Charge Account the Principal Accumulation Investment Proceeds on deposit in the Principal Accumulation Account for application as Available Finance Charge Collections in accordance with Section 4.4.

 

Principal Accumulation Investment Proceeds (including reinvested interest) shall not be considered part of the amounts on deposit in the Principal Accumulation Account for purposes of this Indenture Supplement.

 

Section 4.10                      Reserve Account.

 

(a)           The Indenture Trustee shall establish and maintain with an Eligible Institution, which may be the Indenture Trustee in the name of the Trust, on behalf of the Trust, for the benefit of the Series 2012-B Noteholders, a segregated trust account (the “Reserve Account”), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2012-B Noteholders.  The Indenture Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Reserve Account and in all proceeds thereof.  The Reserve Account shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Series 2012-B Noteholders.  If at any time the institution holding the Reserve Account ceases to be an Eligible Institution, the Transferor shall notify the Indenture Trustee, and the Indenture Trustee upon being notified (or the Servicer on its behalf) shall, within ten (10) Business Days, establish a new Reserve Account meeting the conditions specified above with an Eligible Institution, and shall transfer any cash or any investments to such new Reserve Account.  The Indenture Trustee, at the direction of the Servicer, shall (i) make withdrawals from the Reserve Account from time to time in an amount up to the Available Reserve Account Amount at such time, for the purposes set forth in this Indenture Supplement, and (ii) on each Transfer Date (from and after the Reserve Account Funding Date) prior to termination of the Reserve Account, make a deposit into the Reserve Account in the amount specified in, and otherwise in accordance with, subsection 4.4(a)(ix).

 

(b)           Funds on deposit in the Reserve Account shall be invested at the written direction of the Servicer by the Indenture Trustee in Eligible Investments.  Funds on deposit in the Reserve Account on any Transfer Date, after giving effect to any withdrawals from the Reserve Account on such Transfer Date, shall be invested in such investments that will mature so that such funds will be available for withdrawal on or prior to the following Transfer Date.

 

On each Transfer Date, all interest and earnings (net of losses and investment expenses) accrued since the preceding Transfer Date on funds on deposit in the Reserve Account shall be retained in the Reserve Account (to the extent that the Available Reserve Account Amount is less than the Required Reserve Account Amount) and the balance, if any, shall be deposited into the Finance Charge Account and included in Available Finance Charge Collections for such Transfer Date.  For purposes of determining the availability of funds or the balance in the Reserve Account for any reason under this Indenture Supplement, except as otherwise provided in the preceding sentence, investment earnings on such funds shall be deemed not to be available or on deposit.

 

  

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(c)           On or before each Transfer Date with respect to the Controlled Accumulation Period and on or before the first Transfer Date with respect to the Early Amortization Period, the Servicer shall calculate the Reserve Draw Amount; provided, however, that such amount will be reduced to the extent that funds otherwise would be available for deposit in the Reserve Account under Section 4.4(a)(ix) with respect to such Transfer Date.

 

(d)           If for any Transfer Date the Reserve Draw Amount is greater than zero, the Reserve Draw Amount, up to the Available Reserve Account Amount, shall be withdrawn from the Reserve Account on such Transfer Date by the Indenture Trustee (acting in accordance with the written instructions of the Servicer) and deposited into the Finance Charge Account for application as Available Finance Charge Collections for such Transfer Date.

 

(e)           If the Reserve Account Surplus on any Transfer Date, after giving effect to all deposits to and withdrawals from the Reserve Account with respect to such Transfer Date, is greater than zero, the Indenture Trustee, acting in accordance with the written instructions of the Servicer, shall withdraw from the Reserve Account an amount equal to such Reserve Account Surplus and (x) deposit such amounts in the Spread Account, to the extent that funds on deposit in the Spread Account are less than the Required Spread Account Amount, and (y) distribute any such amounts remaining after application pursuant to the preceding clause (x) to the holders of the Transferor Interest.

 

(f)           Upon the earliest to occur of (i) the termination of the Trust pursuant to Article VIII of the Trust Agreement, (ii) the first Transfer Date relating to the Early Amortization Period and (iii) the Transfer Date immediately preceding the Expected Principal Payment Date, the Indenture Trustee, acting in accordance with the instructions of the Servicer, after the prior payment of all amounts owing to the Series 2012-B Noteholders that are payable from the Reserve Account as provided herein, shall withdraw from the Reserve Account all amounts, if any, on deposit in the Reserve Account and deposit such amounts into the Finance Charge Account for application in the priority set forth in Section 4.4(a), to the extent such payments or deposits have not be made pursuant to Section 4.4(a).  The Reserve Account shall thereafter be automatically terminated for purposes of this Indenture Supplement.

 

Section 4.11                      Spread Account.

 

(a)           On or prior to the Closing Date, the Indenture Trustee shall establish and maintain with an Eligible Institution, which may be the Indenture Trustee in the name of the Trust, on behalf of the Trust, for the benefit of the Class C Noteholders and the Transferor, a segregated account (the “Spread Account”), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Class C Noteholders and the Transferor.  Except as otherwise provided in this Section 4.11, the Indenture Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Spread Account and in all proceeds thereof.  The Spread Account shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Class C Noteholders and the holder of the Transferor Interest.  If at any time the institution holding the Spread Account ceases to be an Eligible Institution, the Servicer shall notify the Indenture Trustee in writing, and the Indenture Trustee upon being notified (or the Servicer on its behalf) shall, within ten (10) Business Days (or such longer period as to which the Rating Agencies may consent) establish a new Spread Account meeting the conditions specified above with an Eligible Institution and shall transfer any cash or any investments to such new Spread Account.  The Indenture Trustee, at the written direction of the Servicer, shall (i) make withdrawals from the Spread Account from time to time in an amount up to the Available Spread Account Amount at such time, for the purposes set forth in this Indenture Supplement, and (ii) on each Transfer Date prior to termination of the Spread Account, make a deposit into the Spread Account in the amount specified in, and otherwise in accordance with, Section 4.11(f).

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(b)           Funds on deposit in the Spread Account shall be invested at the written direction of the Servicer by the Indenture Trustee in Eligible Investments.  Funds on deposit in the Spread Account on any Transfer Date, after giving effect to any withdrawals from and deposits to the Spread Account on such Transfer Date, shall be invested in such investments that will mature so that such funds will be available for withdrawal on or prior to the following Transfer Date.

 

On each Transfer Date (but subject to Section 4.11(c)), the Investment Earnings, if any, accrued since the preceding Transfer Date on funds on deposit in the Spread Account shall be retained in the Spread Account (to the extent that the Available Spread Account Amount is less than the Required Spread Account Amount) and the balance, if any, shall be deposited into the Finance Charge Account and included in Available Finance Charge Collections for such Transfer Date.  For purposes of determining the availability of funds or the balance in the Spread Account for any reason under this Indenture Supplement (subject to Section 4.11(c)), all Investment Earnings shall be deemed not to be available or on deposit.

 

(c)           If, on any Transfer Date, the aggregate amount of Available Finance Charge Collections available for deposit into the Distribution Account pursuant to subsection 4.4(a)(v) is less than the aggregate amount required to be deposited pursuant to subsection 4.4(a)(v), the Indenture Trustee, at the written direction of the Servicer, shall withdraw from the Spread Account the amount of such deficiency up to the Available Spread Account Amount and, if the Available Spread Account Amount is less than such deficiency, Investment Earnings credited to the Spread Account, and deposit such amount in the Distribution Account to fund any deficiency pursuant to subsection 4.4(a)(v).

 

(d)           On the earlier of Series 2012-B Final Maturity Date and the date on which the Class A Note Principal Balance, the Class M Note Principal Balance and the Class B Note Principal Balance have been paid in full, after applying any funds on deposit in the Spread Account as described in Section 4.11(c), the Indenture Trustee at the written direction of the Servicer shall withdraw from the Spread Account an amount equal to the lesser of (i) the Class C Note Principal Balance (after any payments to be made pursuant to Section 4.4(c) on such date) and (ii) the Available Spread Account Amount and, if the Available Spread Account Amount is not sufficient to reduce the Class C Note Principal Balance to zero, Investment Earnings credited to the Spread Account up to the amount required to reduce the Class C Note Principal Balance to zero, and the Indenture Trustee upon the written direction of the Servicer or the Servicer shall deposit such amounts into the Distribution Account for distribution to the Class C Noteholders in accordance with Section 5.2(f).

 

(e)           On any day following the occurrence of an Event of Default with respect to Series 2012-B and acceleration of the maturity of the Series 2012-B Notes pursuant to Section 5.3 of

 

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the Indenture, Servicer shall withdraw from the Spread Account an amount equal to the Available Spread Account Amount and Indenture Trustee or Servicer shall deposit such amounts into the Distribution Account for distribution to the Class C Noteholders, the Class A Noteholders, the Class M Noteholders, the Class B Noteholders and the Class D Noteholders, in that order of priority, in accordance with Section 5.2, to fund any shortfalls in amounts owed to such Noteholders.

 

(f)           If on any Transfer Date, after giving effect to all withdrawals from the Spread Account, the Available Spread Account Amount is less than the Required Spread Account Amount then in effect, Available Finance Charge Collections, to the extent available, shall be deposited into the Spread Account pursuant to subsection 4.4(a)(x) up to the amount of the Spread Account Deficiency.

 

(g)           If, after giving effect to all deposits to and withdrawals from the Spread Account with respect to any Transfer Date, the amount on deposit in the Spread Account exceeds the Required Spread Account Amount, the Indenture Trustee acting in accordance with the instructions of the Servicer, shall withdraw an amount equal to such excess from the Spread Account and distribute such amount to the Transferor.  On the date on which the Class C Note Principal Balance has been paid in full, after making any payments to the Noteholders required pursuant to Sections 4.11(c), (d) and (e), the Indenture Trustee, at the written direction of Servicer, shall withdraw from the Spread Account all amounts then remaining in the Spread Account and pay such amounts to the Transferor.

 

Section 4.12                      Investment Instructions.

 

(a)           Any investment instructions required to be given to the Indenture Trustee pursuant to the terms hereof must be given to the Indenture Trustee no later than 11:00 a.m., New York City time, on the date such investment is to be made.  In the event the Indenture Trustee receives such investment instruction later than such time, the Indenture Trustee may, but shall have no obligation to, make such investment.  In the event the Indenture Trustee is unable to make an investment required in an investment instruction received by the Indenture Trustee after 11:00 a.m., New York City time, on such day, such investment shall be made by the Indenture Trustee on the next succeeding Business Day.  In no event shall the Indenture Trustee be liable for any investment not made pursuant to investment instructions received after 11:00 a.m., New York City time, on the day such investment is requested to be made.

 

(b)           The Indenture Trustee shall hold such of the Eligible Investments in the Series Accounts as consists of instruments, deposit accounts, negotiable documents, money, goods, letters of credit, and advices of credit in the State of New York and/or Illinois. The Indenture Trustee shall hold such of the Eligible Investments as constitutes investment property through a securities intermediary, which securities intermediary shall agree with the Indenture Trustee that (a) such investment property shall at all times be credited to a securities account of the Indenture Trustee, (b) such securities intermediary shall treat the Indenture Trustee as entitled to exercise the rights that comprise each financial asset credited to such securities account, (c) all property credited to such securities account shall be treated as a financial asset, (d) such securities intermediary shall comply with entitlement orders originated by the Indenture Trustee without the further consent of any other person or entity, (e) such securities intermediary will not agree

 

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with any person or entity other than the Indenture Trustee to comply with entitlement orders originated by such other person or entity, (f) such securities accounts and the property credited thereto shall not be subject to any lien, security interest or right of set-off in favor of such securities intermediary or anyone claiming through it (other than the Indenture Trustee), and (g) such agreement shall be governed by the laws of the State of New York. Terms used in the preceding sentence that are defined in the New York UCC and not otherwise defined herein shall have the meaning set forth in the New York UCC.

 

Section 4.13                      Controlled Accumulation Period.  The Controlled Accumulation Period is scheduled to commence at the beginning of business on July 1, 2016; provided that if the Controlled Accumulation Period Length (determined as described below) on any Determination Date on or after the May 2016 Determination Date is less than 12 months, upon written notice to the Indenture Trustee, Transferor and, each Rating Agency, Servicer shall postpone the date on which the Controlled Accumulation Period actually commences so that the number of Monthly Periods in the Controlled Accumulation Period will equal the Controlled Accumulation Period Length; provided that (i) the length of the Controlled Accumulation Period will not be less than one month, (ii) such determination of the Controlled Accumulation Period Length shall be made on each Determination Date on and after the May 2016 Determination Date but prior to the commencement of the Controlled Accumulation Period, and any postponement of the Controlled Accumulation Period shall be subject to the subsequent lengthening of the Controlled Accumulation Period to the Controlled Accumulation Period Length determined on any subsequent Determination Date, but the Controlled Accumulation Period shall in no event commence prior to the Controlled Accumulation Date, and (iii) notwithstanding any other provision of this Indenture Supplement to the contrary, no postponement of the Controlled Accumulation Period shall be made after an Early Amortization Event shall have occurred and be continuing with respect to any other Series.  The “Controlled Accumulation Period Length” will mean a number of whole months such that the amount available for distribution of principal on the Class A Notes, the Class M Notes, the Class B Notes, the Class C Notes and the Class D Notes on the Expected Principal Payment Date is expected to equal or exceed the Note Principal Balance, assuming for this purpose that (1) the payment rate with respect to Principal Collections remains constant at the lowest level of such payment rate during the twelve preceding Monthly Periods (or such lower payment rate as Servicer may select), (2) the total amount of Principal Receivables in the Trust (and the principal amount on deposit in the Excess Funding Account, if any) remains constant at the level on such date of determination, (3) no Early Amortization Event with respect to any Series will subsequently occur and (4) no additional Series (other than any Series being issued on such date of determination) will be subsequently issued; provided that the Servicer may on any Determination Date increase the Controlled Accumulation Period Length calculated as described in the preceding sentence by either 1 month or 2 months.  Any notice by Servicer modifying the commencement of the Controlled Accumulation Period pursuant to this Section 4.13 shall specify (i) the Controlled Accumulation Period Length, (ii) the commencement date of the Controlled Accumulation Period and (iii) the Controlled Accumulation Amount with respect to each Monthly Period during the Controlled Accumulation Period.  The Servicer shall calculate the Controlled Accumulation Period Length on each Determination Date prior to the May 2016 Determination Date as necessary to determine the Reserve Account Funding Date.

 

Section 4.14                      Suspension of Controlled Accumulation Period.

 

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(a)           The commencement of the Controlled Accumulation Period shall be suspended upon delivery by the Servicer to the Indenture Trustee of (i) an Officer’s Certificate stating that all conditions precedent to such suspension set forth in this Section 4.14 have been satisfied, (ii) a copy of an executed Qualified Maturity Agreement, (iii) an Opinion of Counsel addressed to the Indenture Trustee as to the due authorization, execution and delivery and the validity and enforceability of such Qualified Maturity Agreement and (iv) a Tax Opinion concerning the effect of entering into the Qualified Maturity Agreement.  The Servicer shall deliver a prior notice to the Rating Agencies of such suspension.  The Issuer does hereby transfer, assign, set-over, and otherwise convey to the Indenture Trustee for the benefit of the Series 2012-B Noteholders, without recourse, all of its rights under any Qualified Maturity Agreement obtained in accordance with this Section 4.14 and all proceeds thereof.  Such property shall constitute part of the Trust Estate for all purposes of the Indenture.  The foregoing transfer, assignment, set-over and conveyance does not constitute and is not intended to result in a creation or an assumption by the Indenture Trustee or any Noteholder of any obligation of the Issuer or any other Person in connection with a Qualified Maturity Agreement or under any agreement or instrument relating thereto.

 

The Indenture Trustee hereby acknowledges its acceptance, to the extent validly transferred, assigned, set-over or otherwise conveyed to the Indenture Trustee, for the benefit of the Series 2012-B Noteholders, of all of the rights previously held by the Issuer under any Qualified Maturity Agreement obtained by the Issuer and all proceeds thereof, and declares that it shall hold such rights upon the trust set forth herein and in the Agreement, and subject to the terms hereof and thereof, for the benefit of the Series 2012-B Noteholders.

 

(b)           The Issuer shall cause the provider of each Qualified Maturity Agreement to deposit into the Principal Accumulation Account on or before the Expected Principal Payment Date an amount equal to the initial Note Principal Balance; provided, however, that, if provided in the related Qualified Maturity Agreement, all or a portion of such deposits may be funded with the proceeds of the issuance of a new Series or with the Available Principal Collections with respect to such Transfer Date.  The amounts so deposited shall be applied on the Expected Principal Payment Date pursuant to Section 4.4(c) as if the commencement of the Controlled Accumulation Period had not been suspended.

 

(c)           Each Qualified Maturity Agreement shall terminate at the close of business on the Expected Principal Payment Date; provided, however, that the Issuer shall terminate a Qualified Maturity Agreement prior to such Distribution Date, with notice to each Rating Agency, if (i) the Available Reserve Account Amount equals the Required Reserve Account Amount and (ii) one of the following events occurs: (A) the Issuer obtains a substitute Qualified Maturity Agreement, (B) the provider of the Qualified Maturity Agreement ceases to qualify as an Eligible Institution and the Issuer is unable to obtain a substitute Qualified Maturity Agreement or (C) an Early Amortization Event occurs.  In the event that the provider of a Qualified Maturity Agreement ceases to qualify as an Eligible Institution, the Issuer shall use its best efforts to obtain a substitute Qualified Maturity Agreement.

 

(d)           If a Qualified Maturity Agreement is terminated prior to the earlier of the Expected Principal Payment Date and the commencement of the Early Amortization Period and the Issuer does not obtain a substitute Qualified Maturity Agreement, the Controlled

 

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Accumulation Period shall commence on the latest of (i) the beginning of business on July 1, 2016, (ii) the date to which the commencement of the Controlled Accumulation Period is postponed pursuant to Section 4.l3 (as determined on the date of such termination) and (iii) the first day of the Monthly Period following the date of such termination.

 

ARTICLE V.

 

 

Delivery of Series 2012-B Notes; Distributions; Reports to Series 2012-B Noteholders

 

Section 5.1                      Delivery and Payment for the Series 2012-B Notes.  The Owner Trustee, on behalf of the Issuer, shall execute and issue, and the Indenture Trustee shall authenticate, the Series 2012-B Notes in accordance with Section 2.3 of the Indenture.  The Indenture Trustee shall deliver the Series 2012-B Notes to or upon the written order of the Trust when so authenticated.

 

Section 5.2                      Distributions.

 

(a)           On each Distribution Date, the Indenture Trustee shall distribute to each Class A Noteholder of record on the related Record Date (other than as provided in Section 11.2 of the Indenture) such Class A Noteholder’s pro rata share of the amounts on deposit in the Distribution Account that are allocated and available on such Distribution Date and as are payable to the Class A Noteholders pursuant to this Indenture Supplement.

 

(b)           On each Distribution Date, the Indenture Trustee shall distribute to each Class M Noteholder of record on the related Record Date (other than as provided in Section 11.2 of the Indenture) such Class M Noteholder’s pro rata share of the amounts on deposit in the Distribution Account that are allocated and available on such Distribution Date and as are payable to the Class M Noteholders pursuant to this Indenture Supplement.

 

(c)           On each Distribution Date, the Indenture Trustee shall distribute to each Class B Noteholder of record on the related Record Date (other than as provided in Section 11.2 of the Indenture) such Class B Noteholder’s pro rata share of the amounts on deposit in the Distribution Account that are allocated and available on such Distribution Date and as are payable to the Class B Noteholders pursuant to this Indenture Supplement.

 

(d)           On each Distribution Date, the Indenture Trustee shall distribute to each Class C Noteholder of record on the related Record Date (other than as provided in Section 11.2 of the Indenture) such Class C Noteholder’s pro rata share of the amounts on deposit in the Distribution Account (including amounts withdrawn from the Spread Account (at the times and in the amounts specified in Section 4.11)) that are allocated and available on such Distribution Date and as are payable to the Class C Noteholders pursuant to this Indenture Supplement.

 

(e)           On each Distribution Date, the Indenture Trustee shall distribute to each Class D Noteholder of record on the related Record Date (other than as provided in Section 11.2 of the Indenture) such Class D Noteholder’s pro rata share of the amounts on deposit in the Distribution Account that are allocated and available on such Distribution Date and as are payable to the Class D Noteholders pursuant to this Indenture Supplement.

 

  

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(f)           The distributions to be made pursuant to this Section 5.2 are subject to the provisions of Sections 2.6, 6.1 and 7.1 of the Transfer and Servicing Agreement, Section 11.2 of the Indenture and Section 7.1 of this Indenture Supplement.

 

(g)           Except as provided in Section 11.2 of the Indenture with respect to a final distribution, distributions to Series 2012-B Noteholders hereunder shall be made by (i) check mailed to each Series 2012-B Noteholder (at such Noteholder’s address as it appears in the Note Register), except that for any Series 2012-B Notes registered in the name of the nominee of a Clearing Agency, such distribution shall be made by wire transfer of immediately available funds and (ii) without presentation or surrender of any Series 2012-B Note or the making of any notation thereon.

 

Section 5.3                      Reports and Statements to Series 2012-B Noteholders.

 

(a)           On each Distribution Date, the Indenture Trustee shall forward to each Series 2012-B Noteholder a statement substantially in the form of Exhibit C prepared by the Servicer; provided that the Servicer may amend the form of Exhibit C from time to time, with the prior written consent of the Indenture Trustee and with written notice to the Rating Agencies.

 

(b)           Not later than the second Business Day preceding each Distribution Date, the Servicer shall deliver to the Owner Trustee, the Indenture Trustee and each Rating Agency a statement substantially in the form of Exhibit B prepared by the Servicer; provided that the Servicer may amend the form of Exhibit B from time to time, with the prior written consent of the Indenture Trustee.

 

(c)           A copy of each statement or certificate provided pursuant to paragraph (a) or (b) may be obtained by any Series 2012-B Noteholder by a request in writing to the Servicer.

 

(d)           On or before January 31 of each calendar year, beginning with January 31, 2013, the Indenture Trustee shall furnish or cause to be furnished to each Person who at any time during the preceding calendar year was a Series 2012-B Noteholder, a statement prepared by the Servicer containing the information which is required to be contained in the statement to Series 2012-B Noteholders, as set forth in paragraph (a) above, aggregated for such calendar year or the applicable portion thereof during which such Person was a Series 2012-B Noteholder, together with other information as is required to be provided by an issuer of indebtedness under the Code.  Such obligation of the Indenture Trustee shall be deemed to have been satisfied to the extent that substantially comparable information shall be provided by the Servicer pursuant to any requirements of the Code as from time to time in effect.

 

 

ARTICLE VI.

 

 

Series 2012-B Early Amortization Events

 

Section 6.1                      Series 2012-B Early Amortization Events.  If any one of the following events shall occur with respect to the Series 2012-B Notes:

 

(a)           failure on the part of Transferor or the “Transferor” under the Pooling and Servicing Agreement (i) to make any payment or deposit required to be made by it by the terms

 

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of the Pooling and Servicing Agreement, the Collateral Series Supplement, the Transfer and Servicing Agreement, the Indenture or this Indenture Supplement on or before the date occurring five (5) Business Days after the date such payment or deposit is required to be made therein or herein or (ii) duly to observe or perform in any material respect any other of its covenants or agreements set forth in the Transfer and Servicing Agreement, the Pooling and Servicing Agreement, the Indenture or this Indenture Supplement, which failure has a material adverse effect on the Series 2012-B Noteholders and which continues unremedied for a period of sixty (60) days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Transferor by the Indenture Trustee, or to the Transferor and the Indenture Trustee by any Holder of the Series 2012-B Notes;

 

(b)           any representation or warranty made by Transferor or the “Transferor” under the Pooling and Servicing Agreement, in the Transfer and Servicing Agreement or the Pooling and Servicing Agreement or any information contained in a computer file or microfiche list required to be delivered by it pursuant to Section 2.1 or Section 2.6(c) of the Transfer and Servicing Agreement or Section 2.1 or Section 2.6(c) of the Pooling and Servicing Agreement shall prove to have been incorrect in any material respect when made or when delivered, which continues to be incorrect in any material respect for a period of sixty (60) days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Transferor by the Indenture Trustee, or to the Transferor and the Indenture Trustee by any Holder of the Series 2012-B Notes and as a result of which the interests of the Series 2012-B Noteholders are materially and adversely affected for such period; provided, however, that a Series 2012-B Early Amortization Event pursuant to this Section 6.1(b) shall not be deemed to have occurred hereunder if the Transferor has accepted reassignment of the related Receivable, or all of such Receivables, if applicable, during such period in accordance with the provisions of the Transfer and Servicing Agreement or the Pooling and Servicing Agreement;

 

(c)           a failure by Transferor or the “Transferor” under the Pooling and Servicing Agreement to convey Receivables in Additional Accounts or Participations to the Receivables Trust within five (5) Business Days after the day on which it is required to convey such Receivables pursuant to Section 2.6(b) of the Transfer and Servicing Agreement or Section 2.8(b) of the Pooling and Servicing Agreement, respectively; provided, however, that a Series 2012-B Early Amortization Event pursuant to this Section 6.1(c) shall not be deemed to have occurred hereunder if, prior to the date on which such conveyance was required to be completed, Transferor causes a reduction in the Collateral Amount of any Variable Interest to occur or a reduction in the “Invested Amount” or “Adjusted Invested Amount” (as such terms are defined in the Pooling and Servicing Agreement) of any “Variable Interest” (as defined in the Pooling and Servicing Agreement) so that, after giving effect to that reduction (i) the Transferor Amount is not less than the Minimum Transferor Amount and (ii) the sum of the aggregate amount of principal receivables plus amounts on deposit in the Excess Funding Account is not less than the Required Principal Balance;

 

(d)           any Servicer Default or any “Servicer Default” under the Pooling and Servicing Agreement shall occur and as a result of which the interests of the Series 2012-B Noteholders are materially and adversely affected;

 

 

  

39

 

    

    (e)           (i) the average of the Portfolio Yield for the two Monthly Periods immediately preceding the October 2012 Payment Date is less than the average of the Base Rates for the same Monthly Periods, or (ii) beginning with the three consecutive Monthly Periods immediately preceding the November 2012 Payment Date, the Portfolio Yield averaged over any three consecutive Monthly Periods is less than the Base Rate averaged over such period;

 

(f)           the Note Principal Balance shall not be paid in full on the Expected Principal Payment Date;

 

(g)           without limiting the foregoing, the occurrence of an Event of Default with respect to Series 2012-B and acceleration of the maturity of the Series 2012-B Notes pursuant to Section 5.3 of the Indenture; or

 

(h)           the occurrence of an Early Amortization Event as defined in the Pooling and Servicing Agreement and specified in Section 9.1 of that Agreement;

 

then, in the case of any event described in Section (a), (b) or (d), after the applicable grace period, if any, set forth in such subparagraphs, either the Indenture Trustee or the holders of Series 2012-B Notes evidencing more than 50% of the aggregate Outstanding Amount of Series 2012-B Notes (or, if 100% of the principal amount of the Series 2012-B Notes are held by the Transferor or any Affiliate of the Transferor, then the holders of Series 2012-B Notes evidencing more than 50% of the aggregate unpaid principal amount of the Series 2012-B Notes) by notice then given in writing to the Transferor and the Servicer (and to the Indenture Trustee if given by the Series 2012-B Noteholders) may declare that a “Series Early Amortization Event” with respect to Series 2012-B (a “Series 2012-B Early Amortization Event”) has occurred as of the date of such notice, and, in the case of any event described in Section (c), (e), (f), (g) or (h) a Series 2012-B Early Amortization Event shall occur without any notice or other action on the part of the Indenture Trustee or the Series 2012-B Noteholders immediately upon the occurrence of such event.

 

 

ARTICLE VII.

 

Redemption of Series 2012-B Notes; Final Distributions; Series Termination

 

Section 7.1                      Optional Redemption of Series 2012-B Notes; Final Distributions.

 

(a)           On any day occurring on or after the date on which the outstanding principal balance of the Series 2012-B Notes is reduced to 5% or less of the initial outstanding principal balance of Series 2012-B Notes, the Servicer shall have the option to redeem the Series 2012-B Notes, at a purchase price equal to (i) if such day is a Distribution Date, the Reassignment Amount for such Distribution Date or (ii) if such day is not a Distribution Date, the Reassignment Amount for the Distribution Date following such day.

 

(b)           Servicer shall give the Indenture Trustee at least thirty (30) days prior written notice of the date on which Servicer intends to exercise such optional redemption.  Not later than 12:00 noon, New York City time, on such day Servicer shall deposit into the Collection Account in immediately available funds the excess of the Reassignment Amount over the amount, if any, on deposit in the Principal Accumulation Account.  Such redemption option is subject to

 

40

  

  

  

payment in full of the Reassignment Amount.  Following such deposit into the Collection Account in accordance with the foregoing, the Collateral Amount for Series 2012-B shall be reduced to zero and the Series 2012-B Noteholders shall have no further security interest in the Receivables.  The Reassignment Amount shall be distributed as set forth in Section 7.1(d).

 

(c)           (i)           The amount to be paid by the Transferor with respect to Series 2012-B in connection with a reassignment of Receivables to the Transferor pursuant to Section 2.4(e) of the Transfer and Servicing Agreement shall equal the Reassignment Amount for the first Distribution Date following the Monthly Period in which the reassignment obligation arises under the Transfer and Servicing Agreement.

 

(ii)           The amount to be paid by the Transferor with respect to Series 2012-B in connection with a repurchase of the Notes pursuant to Section 7.1 of the Transfer and Servicing Agreement shall equal the Reassignment Amount for the Distribution Date of such repurchase.

 

(d)           With respect to (a) the Reassignment Amount deposited into the Distribution Account pursuant to Section 7.1 or (b) the proceeds of any sale of Receivables pursuant to Section 5.5(a)(iii) of the Indenture with respect to Series 2012-B, the Indenture Trustee shall, in accordance with the written direction of the Servicer, not later than 12:00 noon, New York City time, on the related Distribution Date, make distributions of the following amounts (in the priority set forth below and, in each case, after giving effect to any deposits and distributions otherwise to be made on such date) in immediately available funds:  (i) (x) the Class A Note Principal Balance on such Distribution Date will be distributed to the Class A Noteholders and (y) an amount equal to the sum of (A) Class A Monthly Interest for such Distribution Date, (B) any Class A Deficiency Amount for such Distribution Date and (C) the amount of Class A Additional Interest, if any, for such Distribution Date and any Class A Additional Interest previously due but not distributed to the Class A Noteholders on any prior Distribution Date, will be distributed to the Class A Noteholders, (ii) (x) the Class M Note Principal Balance on such Distribution Date will be distributed to the Class M Noteholders and (y) an amount equal to the sum of (A) Class M Monthly Interest for such Distribution Date, (B) any Class M Deficiency Amount for such Distribution Date and (C) the amount of Class M Additional Interest, if any, for such Distribution Date and any Class M Additional Interest previously due but not distributed to the Class M Noteholders on any prior Distribution Date, will be distributed to the Class M Noteholders, (iii) (x) the Class B Note Principal Balance on such Distribution Date will be distributed to the Class B Noteholders and (y) an amount equal to the sum of (A) Class B Monthly Interest for such Distribution Date, (B) any Class B Deficiency Amount for such Distribution Date and (C) the amount of Class B Additional Interest, if any, for such Distribution Date and any Class B Additional Interest previously due but not distributed to the Class B Noteholders on any prior Distribution Date, will be distributed to the Class B Noteholders, (iv) (x) the Class C Note Principal Balance on such Distribution Date will be distributed to the Class C Noteholders and (y) an amount equal to the sum of (A) Class C Monthly Interest for such Distribution Date, (B) any Class C Deficiency Amount for such Distribution Date, and (C) the amount of Class C Additional Interest, if any, for such Distribution Date and any Class C Additional Interest previously due but not distributed to the Class C Noteholders on any prior Distribution Date will be distributed to the Class C Noteholders, (v) (x) the Class D Note Principal Balance on such Distribution Date will be distributed to the Class D Noteholders and

 

  

41

 

(y) an amount equal to the sum of (A) Class D Monthly Interest for such Distribution Date, (B) any Class D Deficiency Amount for such Distribution Date, and (C) the amount of Class D Additional Interest, if any, for such Distribution Date and any Class D Additional Interest previously due but not distributed to the Class D Noteholders on any prior Distribution Date will be distributed to the Class D Noteholders, and (vi) any excess shall be released to the Issuer.

 

Section 7.2                      Series Termination.  On the Series 2012-B Final Maturity Date, the unpaid principal amount of the Series 2012-B Notes shall be due and payable, and the right of the Series 2012-B Noteholders to receive payments from the Issuer will be limited solely to the right to receive payments pursuant to Section 5.5 of the Indenture.

 

ARTICLE VIII.

 

 

Miscellaneous Provisions

 

Section 8.1                      Ratification of Indenture; Amendments.  As supplemented by this Indenture Supplement, the Indenture is in all respects ratified and confirmed and the Indenture as so supplemented by this Indenture Supplement shall be read, taken and construed as one and the same instrument.  This Indenture Supplement may be amended only by a Supplemental Indenture entered in accordance with the terms of Section 10.1 or 10.2 of the Indenture.  For purposes of the application of Section 10.2 to any amendment of this Indenture Supplement, the Series 2012-B Noteholders shall be the only Noteholders whose vote shall be required.  The Issuer hereby agrees to provide notice of any amendment to this Indenture Supplement to Moody’s within five (5) Business Days of execution thereof.

 

Section 8.2                      Form of Delivery of the Series 2012-B Notes.  The Class  A Notes shall be Book-Entry Notes and shall be delivered as Registered Notes as provided in Sections 2.1 and 2.13 of the Indenture. The Class D Notes shall be, and the Class M Notes, Class B Notes and Class C Notes shall initially be, Definitive Notes registered in the Note Register in the name of the Transferor.  Subject to satisfaction of the conditions specified in Section 8.9 of this Indenture Supplement and Sections 2.3 and 12.1 of the Indenture, if the Transferor desires to sell 100% of outstanding principal amount of the Class M Notes, Class B Notes or Class C Notes to one or more purchasers (other than one or more persons which are considered the same person as WFN or the Transferor for U.S. Federal income tax purposes), the Transferor may exchange the corresponding Definitive Note for a Global Note in the form attached as Exhibit A-2B, Exhibit A-3B, or Exhibit A-4B, respectively, upon surrender of such Definitive Note to the Indenture Trustee; it being understood that the Transferor may not retain any portion of the Definitive Note so exchanged for a Global Note upon a Transfer contemplated by this sentence.  Such exchange shall not constitute an amendment of this Indenture Supplement.

 

Section 8.3                      Counterparts.  This Indenture Supplement may be executed in two or more counterparts, and by different parties on separate counterparts, each of which shall be an original, but all of which shall constitute one and the same instrument.

 

Section 8.4                      GOVERNING LAW.  THIS INDENTURE SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

  42

 

  

  

       Section 8.5                      Limitation of Liability.  Notwithstanding any other provision herein or elsewhere, this Agreement has been executed and delivered by U.S. Bank Trust National Association, not in its individual capacity, but solely in its capacity as Owner Trustee of the Trust, in no event shall U.S. Bank Trust National Association in its individual capacity have any liability in respect of the representations, warranties, or obligations of the Trust hereunder or under any other document, as to all of which recourse shall be had solely to the assets of the Trust, and for all purposes of this Agreement and each other document, the Owner Trustee (as such or in its individual capacity) shall be subject to, and entitled to the benefits of, the terms and provisions of the Trust Agreement.

 

Section 8.6                      Rights of the Indenture Trustee.  The Indenture Trustee shall have herein the same rights, protections, indemnities and immunities as specified in the Master Indenture.

 

Section 8.7                      Additional Provisions.

 

(a)           The Additional Minimum Transferor Amount is hereby specified as an additional amount to be considered part of the Minimum Transferor Amount pursuant to clause (b) of the definition of Minimum Transferor Amount.

 

(b)           Transferor shall not exercise its right to require reassignment to it or its designee of the Receivables in any Removed Account or “Removed Account” (as defined in the Pooling and Servicing Agreement) pursuant to Section 2.7(a) of the Transfer and Servicing Agreement or Section 2.9(a) of the Pooling and Servicing Agreement more than once during any Monthly Period; it being understood that this Section 8.7(b) shall not limit any right of the Transferor pursuant to Section 2.7(b) of the Transfer and Servicing Agreement or Section 2.9(b) of the Pooling and Servicing Agreement.

 

(c)           Transferor shall not exercise its discount option pursuant to Section 2.10 of the Pooling and Servicing Agreement or Section 2.8 of the Transfer and Servicing Agreement.

 

Section 8.8                      Notice Address for Rating Agencies.  Delivery of any notices required to be delivered to the Rating Agencies by the Issuer, the Indenture Trustee or the Owner Trustee shall be sufficient for the purposes of this Indenture Supplement and the other Transaction Documents if sent to such mailing addresses or such email addresses as may be provided by the Rating Agencies.

 

Section 8.9                      Additional Requirements for Registration of and Limitations on Transfer and Exchange of Notes.

 

(a)           All Transfers will be subject to the transfer restrictions set forth on the Notes.

 

(b)           No Transfer (or purported Transfer) of a Class M Note, Class B Note, Class C Note or Class D Note (or economic interest therein) shall be made by WFN, the Transferor or any person which is considered the same person as WFN or the Transferor for U.S. Federal income tax

  43

  

  

  

  

purposes (except to a person which is considered the same person as WFN for such purposes) and any such Transfer (or purported Transfer) of such Notes shall be void ab initio unless an Opinion of Counsel is first delivered to the Indenture Trustee to the effect that such Notes will constitute debt for U.S. federal income tax purposes; provided that any such Note may be pledged to a Federal Reserve Bank provided that the pledge thereof and the exercise of remedies by the Federal Reserve Bank in connection therewith shall be subject to the requirement that such Note shall not be further transferrable unless an Opinion of Counsel is first delivered to the Indenture Trustee to the effect that such Notes will constitute debt for U.S. federal income tax purposes.

 

 

 

 

[SIGNATURE PAGE FOLLOWS]

 

  44

 

  

  

IN WITNESS WHEREOF, the undersigned have caused this Indenture Supplement to be duly executed and delivered by their respective duly authorized officers on the day and year first above written.

 

WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST, as Issuer

 

By:  U.S. Bank Trust National Association, not in its individual capacity, but solely as Owner Trustee

 

By:  /s/Annette Morgan        

 

  Name:               Annette Morgan   

 

  Title:                 Assistant Vice President

 

UNION BANK, N.A., as Indenture Trustee

 

By:  /s/Eva Aryeetey         

 

  Name:               Eva Aryeetey

 

  Title:                 Vice President

 

Acknowledged and Accepted:

WORLD FINANCIAL NETWORK BANK,

  as Servicer

By:  /s/ Timothy P. King        

 

  Name:  Timothy P. King

 

  Title:  President

 

WFN CREDIT COMPANY, LLC

 

  as Transferor

 

By:  /s/ Ronald C. Reed         

 

  Name:  Ronald C. Reed

 

  Title:  Assistant Treasurer

 

 

S-1             Indenture Supplement

 

  

  

 

 

EXHIBIT A-1

 

FORM OF CLASS A SERIES 2012-B 1.76% ASSET BACKED NOTE

 

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK (“WFNMT”), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION DOCUMENTS.

 

THE HOLDER OF THIS CLASS A NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS A NOTES AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

BY YOUR ACQUISITION OF THIS NOTE OR ANY INTEREST HEREIN, YOU SHALL BE DEEMED TO REPRESENT, COVENANT AND AGREE, FOR THE BENEFIT OF THE ISSUER, THE INDENTURE TRUSTEE, THE UNDERWRITERS, THE SERVICER, WORLD FINANCIAL NETWORK BANK AND THE TRANSFEROR, THAT EITHER (A) YOU ARE NOT A BENEFIT PLAN (AS DEFINED BELOW) AND THAT YOU ARE NOT PURCHASING OR HOLDING SUCH NOTE OR ANY INTEREST HEREIN ON BEHALF OF, OR WITH THE ASSETS OF, A BENEFIT PLAN OR (B) YOUR PURCHASE, HOLDING AND DISPOSITION OF THIS NOTE OR INTEREST HEREIN WILL NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA (AS DEFINED BELOW), SECTION 4975 OF THE CODE (AS DEFINED BELOW) OR ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW.  FOR THESE PURPOSES, A “BENEFIT PLAN” INCLUDES AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS

 

	 	
Exhibit A-1 (Page 1)

	  

  

  

  

SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, A “PLAN” (AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF SUCH EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY OR ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION SECTIONS OF ERISA OR SECTION 4975 OF THE CODE.

 

	 	
Exhibit A-1 (Page 2 )

	  

  

  

  

REGISTERED  $325,000,000

 

No. R-                     CUSIP NO. 981464 DB3

 

 

 

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS A SERIES 2012-B 1.76% ASSET BACKED NOTE

 

World Financial Network Credit Card Master Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust governed by an Amended and Restated Trust Agreement dated as of August 1, 2001 (as amended and supplemented), for value received, hereby promises to pay to Cede & Co., or registered assigns, subject to the following provisions, the principal sum of THREE HUNDRED TWENTY FIVE MILLION DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the May 2021 Distribution Date, except as otherwise provided below or in the Indenture.  The Issuer will pay interest on the unpaid principal amount of this Note at the Class A Note Interest Rate on each Distribution Date until the principal amount of this Note is paid in full.  Interest on this Note will accrue for each Distribution Date from and including the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, for the initial Distribution Date, from and including the Closing Date to but excluding such Distribution Date.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.  Principal of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.

 

The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.

 

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture or the Indenture Supplement referred to on the reverse hereof, or be valid for any purpose.

 

	 	
Exhibit A-1 (Page 3 )

	  

  

  

  

IN WITNESS WHEREOF, the Issuer has caused this Class A Note to be duly executed.

 

WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST,

as Issuer

 

By:           U.S. Bank Trust National Association, not in its individual capacity but solely as Owner Trustee under the Trust Agreement

 

By: _______________________

 

  Name:                 

  Title:                 

 

 

Dated:  ________________, 20[__]

 

	 	
Exhibit A-1 (Page 4 )

	  

  

  

  

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class A Notes described in the within-mentioned Indenture.

 

UNION BANK, N.A., as Indenture Trustee

 

By:   _____________________________________                                  

    Authorized Signatory

 

Dated: ____________________________________

 

 

Exhibit A-1 (Page 5)

  

  

  

 

 

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS A SERIES 2012-B 1.76% ASSET BACKED NOTE

 

 

Summary of Terms and Conditions

 

This Class A Note is one of a duly authorized issue of Notes of the Issuer, designated as World Financial Network Credit Card Master Note Trust, Series 2012-B (the “Series 2012-B Notes”), issued under a Master Indenture dated as of August 1, 2001 (as amended and supplemented, the “Master Indenture”), between the Issuer and Union Bank, N.A., as indenture trustee (the “Indenture Trustee”), as supplemented by the Indenture Supplement dated as of July 19, 2012 (the “Indenture Supplement”), and representing the right to receive certain payments from the Issuer.  The term “Indenture,” unless the context otherwise requires, refers to the Master Indenture as supplemented by the Indenture Supplement.  The Notes are subject to all of the terms of the Indenture.  All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.  In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall control.

 

The Class B Notes, the Class M Notes, the Class C Notes and the Class D Notes will also be issued under the Indenture.

 

The Noteholder, by its acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject to any liability under the Indenture.

 

This Note does not purport to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS A NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, WORLD FINANCIAL NETWORK BANK, WFN CREDIT COMPANY, LLC, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

 

The Issuer, the Transferor, the Indenture Trustee and any agent of the Issuer, the Transferor or the Indenture Trustee shall treat the person in whose name this Class A Note is registered as the owner hereof for all purposes, and neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be affected by notice to the contrary.

 

THIS CLASS A NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

  

Exhibit A-1 (Page 6)

  

 

 

 

  

ASSIGNMENT

 

Social Security or other identifying number of assignee

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto                                   (name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints                              attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

	
  

	
Dated:________________________

	 	 

 

	
  

	
Signature Guaranteed: ___________________________________**

 

 

  

 

 

 

 

    **The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

	 	
Exhibit A-1 (Page 8 )

	  

  

  

  

 

EXHIBIT A-2A

FORM OF DEFINITIVE CLASS M SERIES 2012-B 3.25% ASSET BACKED NOTE

 

THIS CLASS M NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THE NEXT SENTENCE.  BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER OF THIS NOTE:

 

	
  

	
(1)  AGREES FOR THE BENEFIT OF THE ISSUER AND THE TRANSFEROR THAT THIS CLASS M NOTE MAY BE SOLD, TRANSFERRED, ASSIGNED, PARTICIPATED, PLEDGED OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS, AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE l44A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (II) TO THE DEPOSITOR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES; AND

 

	
  

	
(2)  AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS CLASS M NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK (“WFNMT”), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION DOCUMENTS.

 

THE HOLDER OF THIS CLASS M NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS M NOTES AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL,

 

	 	
Exhibit A-2A (Page 1 )

	  

  

  

  

STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

BY YOUR ACQUISITION OF THIS NOTE OR ANY INTEREST HEREIN, YOU SHALL BE DEEMED TO REPRESENT, COVENANT AND AGREE, FOR THE BENEFIT OF THE ISSUER, THE INDENTURE TRUSTEE, THE UNDERWRITERS, THE SERVICER, WORLD FINANCIAL NETWORK BANK AND THE TRANSFEROR, THAT EITHER (A) YOU ARE NOT A BENEFIT PLAN (AS DEFINED BELOW) AND THAT YOU ARE NOT PURCHASING OR HOLDING SUCH NOTE OR ANY INTEREST HEREIN ON BEHALF OF, OR WITH THE ASSETS OF, A BENEFIT PLAN OR (B) YOUR PURCHASE, HOLDING AND DISPOSITION OF THIS NOTE OR INTEREST HEREIN WILL NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA (AS DEFINED BELOW), SECTION 4975 OF THE CODE (AS DEFINED BELOW) OR ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW.  FOR THESE PURPOSES, A “BENEFIT PLAN” INCLUDES AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, A “PLAN” (AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF SUCH EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY OR ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION SECTIONS OF ERISA OR SECTION 4975 OF THE CODE.

 

TRANSFER OF THIS NOTE IS SUBJECT TO RESTRICTIONS AS PROVIDED IN THE INDENTURE SUPPLEMENT.  NO TRANSFER OF THIS NOTE SHALL BE MADE BY WORLD FINANCIAL NETWORK BANK (“WFN”), THE TRANSFEROR OR ANY PERSON WHICH IS CONSIDERED THE SAME PERSON AS WFN OR THE TRANSFEROR FOR U.S. FEDERAL INCOME TAX PURPOSES (EXCEPT TO A PERSON WHICH IS CONSIDERED THE SAME PERSON AS WFN FOR SUCH PURPOSES) AND ANY SUCH TRANSFER SHALL BE VOID AB INITIO UNLESS AN OPINION OF COUNSEL IS FIRST DELIVERED TO THE INDENTURE TRUSTEE TO THE EFFECT THAT SUCH NOTES WILL CONSTITUTE DEBT FOR U.S. FEDERAL INCOME TAX PURPOSES; PROVIDED THAT THIS NOTE MAY BE PLEDGED TO A FEDERAL RESERVE BANK PROVIDED THAT THE  PLEDGE THEREOF AND THE EXERCISE OF REMEDIES BY THE FEDERAL RESERVE BANK IN CONNECTION THEREWITH SHALL BE SUBJECT TO THE REQUIREMENT THAT THIS NOTE SHALL NOT BE FURTHER TRANSFERRABLE UNLESS AN OPINION OF COUNSEL IS FIRST DELIVERED TO THE INDENTURE TRUSTEE TO THE EFFECT THAT SUCH NOTES WILL CONSTITUTE DEBT FOR U.S. FEDERAL INCOME TAX PURPOSES.

 

 

	 	
Exhibit A-2A (Page 2 )

	  

  

  

  

REGISTERED   $16,250,000

 

No. R-                      CUSIP No. 981464 DC1

 

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS M SERIES 2012-B 3.25% ASSET BACKED NOTE

 

World Financial Network Credit Card Master Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust governed by an Amended and Restated Trust Agreement dated as of August 1, 2001 (as amended and supplemented), for value received, hereby promises to pay to ______________, or registered assigns, subject to the following provisions, the principal sum of SIXTEEN MILLION TWO HUNDRED FIFTY THOUSAND DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the May 2021 Distribution Date, except as otherwise provided below or in the Indenture.  The Issuer will pay interest on the unpaid principal amount of this Note at the Class M Note Interest Rate on each Distribution Date until the principal amount of this Note is paid in full.  Interest on this Note will accrue for each Distribution Date from and including the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, for the initial Distribution Date, from and including the Closing Date to but excluding such Distribution Date.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.  Principal of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.

 

The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.

 

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture or the Indenture Supplement referred to on the reverse hereof, or be valid for any purpose.

 

THIS CLASS M NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.

 

	 	
Exhibit A-2A (Page 3)

	  

  

  

  

IN WITNESS WHEREOF, the Issuer has caused this Class M Note to be duly executed.

 

WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST,

as Issuer

 

By:U.S. Bank Trust National Association, not in its individual capacity but solely as Owner Trustee under the Trust Agreement

 

By:  _____________________

  Name:                 

 

  Title:                 

 

 

 

 

Dated: ____________________, 20[__]

 

	 	
Exhibit A-2A (Page  4)

	  

  

  

  

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class M Notes described in the within-mentioned Indenture.

 

UNION BANK, N.A.,

as Indenture Trustee

 

By:  ___________________________________ 

                Authorized Signatory                                                                      

 

Dated: ___________________________________

	 	
Exhibit A-2A (Page 5)

	  

  

  

  

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS M SERIES 2012-B 3.25% ASSET BACKED NOTE

 

 

Summary of Terms and Conditions

 

This Class M Note is one of a duly authorized issue of Notes of the Issuer, designated as World Financial Network Credit Card Master Note Trust, Series 2012-B (the “Series 2012-B Notes”), issued under a Master Indenture dated as of August 1, 2001 (as amended and supplemented, the “Master Indenture”), between the Issuer and Union Bank, N.A., as indenture trustee (the “Indenture Trustee”), as supplemented by the Indenture Supplement dated as of July 19, 2012 (the “Indenture Supplement”), and representing the right to receive certain payments from the Issuer.  The term “Indenture,” unless the context otherwise requires, refers to the Master Indenture as supplemented by the Indenture Supplement.  The Notes are subject to all of the terms of the Indenture.  All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.  In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall control.

 

The Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes will also be issued under the Indenture.

 

Payments of principal and interest on the Class M Notes are subordinated to payments of principal and interest on the Class A Notes pursuant to and in accordance with the Indenture.

 

The Noteholder, by its acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject to any liability under the Indenture.

 

This Note does not purport to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS M NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, WORLD FINANCIAL NETWORK BANK, WFN CREDIT COMPANY, LLC, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

 

The Issuer, the Transferor, the Indenture Trustee and any agent of the Issuer, the Transferor or the Indenture Trustee shall treat the person in whose name this Class M Note is registered as the owner hereof for all purposes, and neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be affected by notice to the contrary.

 

	 	
Exhibit A-2A (Page 6)

	  

  

  

  

THIS CLASS M NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

	 	
Exhibit A-2A (Page 7)

	  

  

  

  

ASSIGNMENT

 

Social Security or other identifying number of assignee                                .

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto                                   (name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints                              attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

	
  

	
    Dated: ________________________

	
    

    Signature Guaranteed:____________________________**

	
 

	
 

 

	
  

	 

 

 

  

       **The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

	 	
Exhibit A-2A (Page 8 )

	  

  

  

EXHIBIT A-2B

FORM OF GLOBAL CLASS M SERIES 2012-B 3.25% ASSET BACKED NOTE

 

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THIS CLASS M NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THE NEXT SENTENCE.  BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER OF THIS NOTE:

 

	
  

	
(1)  AGREES FOR THE BENEFIT OF THE ISSUER AND THE TRANSFEROR THAT THIS CLASS M NOTE MAY BE SOLD, TRANSFERRED, ASSIGNED, PARTICIPATED, PLEDGED OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS, AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE l44A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (II) TO THE DEPOSITOR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES; AND

 

	
  

	
(2)  AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS CLASS M NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK (“WFNMT”), THE TRANSFEROR OR

 

	 	
Exhibit A-2B (Page 1 )

	  

  

  

 

THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION DOCUMENTS.

 

THE HOLDER OF THIS CLASS M NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS M NOTES AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

BY YOUR ACQUISITION OF THIS NOTE OR ANY INTEREST HEREIN, YOU SHALL BE DEEMED TO REPRESENT, COVENANT AND AGREE, FOR THE BENEFIT OF THE ISSUER, THE INDENTURE TRUSTEE, THE UNDERWRITERS, THE SERVICER, WORLD FINANCIAL NETWORK BANK AND THE TRANSFEROR, THAT EITHER (A) YOU ARE NOT A BENEFIT PLAN (AS DEFINED BELOW) AND THAT YOU ARE NOT PURCHASING OR HOLDING SUCH NOTE OR ANY INTEREST HEREIN ON BEHALF OF, OR WITH THE ASSETS OF, A BENEFIT PLAN OR (B) YOUR PURCHASE, HOLDING AND DISPOSITION OF THIS NOTE OR INTEREST HEREIN WILL NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA (AS DEFINED BELOW), SECTION 4975 OF THE CODE (AS DEFINED BELOW) OR ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW.  FOR THESE PURPOSES, A “BENEFIT PLAN” INCLUDES AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, A “PLAN” (AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF SUCH EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY OR ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION SECTIONS OF ERISA OR SECTION 4975 OF THE CODE.

 

	 	
Exhibit A-2B (Page 2 )

	  

  

  

 

REGISTERED $16,250,000

 

No. R-                       CUSIP No. 981464 DC1

 

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS M SERIES 2012-B 3.25% ASSET BACKED NOTE

 

World Financial Network Credit Card Master Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust governed by an Amended and Restated Trust Agreement dated as of August 1, 2001 (as amended and supplemented), for value received, hereby promises to pay to Cede & Co., or registered assigns, subject to the following provisions, the principal sum of SIXTEEN MILLION TWO HUNDRED FIFTY THOUSAND DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the May 2021 Distribution Date, except as otherwise provided below or in the Indenture.  The Issuer will pay interest on the unpaid principal amount of this Note at the Class M Note Interest Rate on each Distribution Date until the principal amount of this Note is paid in full.  Interest on this Note will accrue for each Distribution Date from and including the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, for the initial Distribution Date, from and including the Closing Date to but excluding such Distribution Date.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.  Principal of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.

 

The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.

 

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture or the Indenture Supplement referred to on the reverse hereof, or be valid for any purpose.

 

THIS CLASS M NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.

 

	 	
Exhibit A-2B (Page 3)

	  

  

  

  

IN WITNESS WHEREOF, the Issuer has caused this Class M Note to be duly executed.

 

WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST,

as Issuer

 

By:U.S. Bank Trust National Association, not in its individual capacity but solely as Owner Trustee under the Trust Agreement

 

 

By:  ______________________________                                                                    

 

Name:

Title:

 

Dated: _________________, 20[__]

 

	 	
Exhibit A-2B (Page 4)

	  

  

  

  

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class M Notes described in the within-mentioned Indenture.

 

UNION BANK, N.A.,

as Indenture Trustee

 

By:   ____________________________________

           Authorized Signatory      

 

                       

Dated: ___________________________________

	 	
Exhibit A-2B (Page 5)

	  

  

  

  

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS M SERIES 2012-B 3.25% ASSET BACKED NOTE

 

 

Summary of Terms and Conditions

 

This Class M Note is one of a duly authorized issue of Notes of the Issuer, designated as World Financial Network Credit Card Master Note Trust, Series 2012-B (the “Series 2012-B Notes”), issued under a Master Indenture dated as of August 1, 2001 (as amended and supplemented, the “Master Indenture”), between the Issuer and Union Bank, N.A., as indenture trustee (the “Indenture Trustee”), as supplemented by the Indenture Supplement dated as of July 19, 2012 (the “Indenture Supplement”), and representing the right to receive certain payments from the Issuer.  The term “Indenture,” unless the context otherwise requires, refers to the Master Indenture as supplemented by the Indenture Supplement.  The Notes are subject to all of the terms of the Indenture.  All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.  In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall control.

 

The Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes will also be issued under the Indenture.

 

Payments of principal and interest on the Class M Notes are subordinated to payments of principal and interest on the Class A Notes pursuant to and in accordance with the Indenture.

 

The Noteholder, by its acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject to any liability under the Indenture.

 

This Note does not purport to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS M NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, WORLD FINANCIAL NETWORK BANK, WFN CREDIT COMPANY, LLC, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

 

The Issuer, the Transferor, the Indenture Trustee and any agent of the Issuer, the Transferor or the Indenture Trustee shall treat the person in whose name this Class M Note is registered as the owner hereof for all purposes, and neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be affected by notice to the contrary.

 

	 	
Exhibit A-2B (Page 6 )

	  

  

  

  

THIS CLASS M NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

	 	
Exhibit A-2B (Page 7 )

	  

  

  

 

ASSIGNMENT

 

Social Security or other identifying number of assignee                               .

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto                                   (name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints                              attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

	
  

	
Dated:______________________

	 	
 

	
 

 

	
  

	
Signature Guaranteed:_____________________**

 

 

  

       **The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

	 	
Exhibit A-2B (Page 8 )

	  

  

  

  

EXHIBIT A-3A

 

FORM OF DEFINITIVE CLASS B SERIES 2012-B 3.50% ASSET BACKED NOTE

 

THIS CLASS B NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THE NEXT SENTENCE.  BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER OF THIS CLASS B NOTE:

 

	
  

	
(1)  AGREES FOR THE BENEFIT OF THE ISSUER AND THE TRANSFEROR THAT THIS NOTE MAY BE SOLD, TRANSFERRED, ASSIGNED, PARTICIPATED, PLEDGED OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS, AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE l44A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (II) TO THE DEPOSITOR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES; AND

 

	
  

	
(2)  AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS CLASS B NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK (“WFNMT”), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION DOCUMENTS.

 

THE HOLDER OF THIS CLASS B NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS B NOTES AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

	 	
Exhibit A-3A (Page 1 )

	  

 

  

  

  

 

BY YOUR ACQUISITION OF THIS NOTE OR ANY INTEREST HEREIN, YOU SHALL BE DEEMED TO REPRESENT, COVENANT AND AGREE, FOR THE BENEFIT OF THE ISSUER, THE INDENTURE TRUSTEE, THE UNDERWRITERS, THE SERVICER, WORLD FINANCIAL NETWORK BANK AND THE TRANSFEROR, THAT EITHER (A) YOU ARE NOT A BENEFIT PLAN (AS DEFINED BELOW) AND THAT YOU ARE NOT PURCHASING OR HOLDING SUCH NOTE OR ANY INTEREST HEREIN ON BEHALF OF, OR WITH THE ASSETS OF, A BENEFIT PLAN OR (B) YOUR PURCHASE, HOLDING AND DISPOSITION OF THIS NOTE OR INTEREST HEREIN WILL NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA (AS DEFINED BELOW), SECTION 4975 OF THE CODE (AS DEFINED BELOW) OR ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW.  FOR THESE PURPOSES, A “BENEFIT PLAN” INCLUDES AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, A “PLAN” (AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF SUCH EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY OR ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION SECTIONS OF ERISA OR SECTION 4975 OF THE CODE.

 

TRANSFER OF THIS NOTE IS SUBJECT TO RESTRICTIONS AS PROVIDED IN THE INDENTURE SUPPLEMENT.  NO TRANSFER OF THIS NOTE SHALL BE MADE BY WORLD FINANCIAL NETWORK BANK (“WFN”), THE TRANSFEROR OR ANY PERSON WHICH IS CONSIDERED THE SAME PERSON AS WFN OR THE TRANSFEROR FOR U.S. FEDERAL INCOME TAX PURPOSES (EXCEPT TO A PERSON WHICH IS CONSIDERED THE SAME PERSON AS WFN FOR SUCH PURPOSES) AND ANY SUCH TRANSFER SHALL BE VOID AB INITIO UNLESS AN OPINION OF COUNSEL IS FIRST DELIVERED TO THE INDENTURE TRUSTEE TO THE EFFECT THAT SUCH NOTES WILL CONSTITUTE DEBT FOR U.S. FEDERAL INCOME TAX PURPOSES; PROVIDED THAT THIS NOTE MAY BE PLEDGED TO A FEDERAL RESERVE BANK PROVIDED THAT THE  PLEDGE THEREOF AND THE EXERCISE OF REMEDIES BY THE FEDERAL RESERVE BANK IN CONNECTION THEREWITH SHALL BE SUBJECT TO THE REQUIREMENT THAT THIS NOTE SHALL NOT BE FURTHER TRANSFERRABLE UNLESS AN OPINION OF COUNSEL IS FIRST DELIVERED TO THE INDENTURE TRUSTEE TO THE EFFECT THAT SUCH NOTES WILL CONSTITUTE DEBT FOR U.S. FEDERAL INCOME TAX PURPOSES.

 

 

	 	
Exhibit A-3A (Page 2 )

	  

  

  

 

REGISTERED   $20,583,000

 

No. R-                       CUSIP No. 981464 DD9

 

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS B SERIES 2012-B 3.50% ASSET BACKED NOTE

 

World Financial Network Credit Card Master Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust governed by an Amended and Restated Trust Agreement dated as of August 1, 2001 (as amended and supplemented), for value received, hereby promises to pay to __________, or registered assigns, subject to the following provisions, the principal sum of TWENTY MILLION FIVE HUNDRED EIGHTY THREE THOUSAND DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the May 2021 Distribution Date, except as otherwise provided below or in the Indenture.  The Issuer will pay interest on the unpaid principal amount of this Note at the Class B Note Interest Rate on each Distribution Date until the principal amount of this Note is paid in full.  Interest on this Note will accrue for each Distribution Date from and including the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, for the initial Distribution Date, from and including the Closing Date to but excluding such Distribution Date.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.  Principal of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.

 

The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.

 

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture or the Indenture Supplement referred to on the reverse hereof, or be valid for any purpose.

 

THIS CLASS B NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A NOTES AND THE CLASS M NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.

 

	 	
Exhibit A-3A (Page 3)

	  

  

  

 

IN WITNESS WHEREOF, the Issuer has caused this Class B Note to be duly executed.

 

WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST,

as Issuer

 

By:U.S. Bank Trust National Association, not in its individual capacity but solely as Owner Trustee under the Trust Agreement

 

 

By:       _____________________                                                                  

 

Name:

Title:

 

Dated: ________________, 20[__]

 

	 	
Exhibit A-3A (Page 4 )

	  

  

  

  

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class B Notes described in the within-mentioned Indenture.

 

UNION BANK, N.A.,

as Indenture Trustee

 

By:  _____________________________________ 

          Authorized Signatory                                                                      

 

                       

Dated: ___________________________________

	 	
Exhibit A-3A (Page 5 )

	  

  

  

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS B SERIES 2012-B 3.50% ASSET BACKED NOTE

 

 

Summary of Terms and Conditions

 

This Class B Note is one of a duly authorized issue of Notes of the Issuer, designated as World Financial Network Credit Card Master Note Trust, Series 2012-B (the “Series 2012-B Notes”), issued under a Master Indenture dated as of August 1, 2001 (as amended and supplemented, the “Master Indenture”), between the Issuer and Union Bank, N.A., as indenture trustee (the “Indenture Trustee”), as supplemented by the Indenture Supplement dated as of July 19, 2012 (the “Indenture Supplement”), and representing the right to receive certain payments from the Issuer.  The term “Indenture,” unless the context otherwise requires, refers to the Master Indenture as supplemented by the Indenture Supplement.  The Notes are subject to all of the terms of the Indenture.  All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.  In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall control.

 

The Class A Notes, the Class M Notes, the Class C Notes and the Class D Notes will also be issued under the Indenture.

 

Payments of principal and interest on the Class B Notes are subordinated to payments of principal and interest on the Class A Notes and the Class M Notes pursuant to and in accordance with the Indenture.

 

The Noteholder, by its acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject to any liability under the Indenture.

 

This Note does not purport to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS B NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, WORLD FINANCIAL NETWORK BANK, WFN CREDIT COMPANY, LLC, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

 

The Issuer, the Transferor, the Indenture Trustee and any agent of the Issuer, the Transferor or the Indenture Trustee shall treat the person in whose name this Class B Note is registered as the owner hereof for all purposes, and neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be affected by notice to the contrary.

 

	 	
Exhibit A-3A (Page 6 )

	  

  

  

    THIS CLASS B NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

	 	
Exhibit A-3A (Page 7)

	  

  

  

  

ASSIGNMENT

 

Social Security or other identifying number of assignee                                .

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto                                   (name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints                              attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

	
  

	
Dated:_______________________

	 	
 

	
 

	
 

	 Signature Guaranteed: __________________________**

 

 

  

       **The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

	 	
Exhibit A-3A (Page 8 )

	  

  

  

  

EXHIBIT A-3B

FORM OF GLOBAL CLASS B SERIES 2012-B 3.50% ASSET BACKED NOTE

 

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THIS CLASS B NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THE NEXT SENTENCE.  BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER OF THIS CLASS B NOTE:

 

	
  

	
(1)  AGREES FOR THE BENEFIT OF THE ISSUER AND THE TRANSFEROR THAT THIS NOTE MAY BE SOLD, TRANSFERRED, ASSIGNED, PARTICIPATED, PLEDGED OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS, AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE l44A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (II) TO THE DEPOSITOR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES; AND

 

	
  

	
(2)  AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS CLASS B NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK (“WFNMT”), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION DOCUMENTS.

	  	
 

Exhibit A-3B (Page 1 )

	  

 

  

  

  

THE HOLDER OF THIS CLASS B NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS B NOTES AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

BY YOUR ACQUISITION OF THIS NOTE OR ANY INTEREST HEREIN, YOU SHALL BE DEEMED TO REPRESENT, COVENANT AND AGREE, FOR THE BENEFIT OF THE ISSUER, THE INDENTURE TRUSTEE, THE UNDERWRITERS, THE SERVICER, WORLD FINANCIAL NETWORK BANK AND THE TRANSFEROR, THAT EITHER (A) YOU ARE NOT A BENEFIT PLAN (AS DEFINED BELOW) AND THAT YOU ARE NOT PURCHASING OR HOLDING SUCH NOTE OR ANY INTEREST HEREIN ON BEHALF OF, OR WITH THE ASSETS OF, A BENEFIT PLAN OR (B) YOUR PURCHASE, HOLDING AND DISPOSITION OF THIS NOTE OR INTEREST HEREIN WILL NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA (AS DEFINED BELOW), SECTION 4975 OF THE CODE (AS DEFINED BELOW) OR ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW.  FOR THESE PURPOSES, A “BENEFIT PLAN” INCLUDES AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, A “PLAN” (AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF SUCH EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY OR ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION SECTIONS OF ERISA OR SECTION 4975 OF THE CODE.

 

 

	  	
Exhibit A-3B (Page 2 )

	  

  

  

  

REGISTERED  $20,583,000

 

No. R-                      CUSIP No. 981464 DD9

 

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS B SERIES 2012-B 3.50% ASSET BACKED NOTE

 

World Financial Network Credit Card Master Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust governed by an Amended and Restated Trust Agreement dated as of August 1, 2001 (as amended and supplemented), for value received, hereby promises to pay to Cede & Co., or registered assigns, subject to the following provisions, the principal sum of TWENTY MILLION FIVE HUNDRED EIGHTY THREE THOUSAND DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the May 2021 Distribution Date, except as otherwise provided below or in the Indenture.  The Issuer will pay interest on the unpaid principal amount of this Note at the Class B Note Interest Rate on each Distribution Date until the principal amount of this Note is paid in full.  Interest on this Note will accrue for each Distribution Date from and including the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, for the initial Distribution Date, from and including the Closing Date to but excluding such Distribution Date.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.  Principal of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.

 

The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.

 

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture or the Indenture Supplement referred to on the reverse hereof, or be valid for any purpose.

 

THIS CLASS B NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A NOTES AND THE CLASS M NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.

 

	  	
Exhibit A-3B (Page 3)

	  

  

  

 

IN WITNESS WHEREOF, the Issuer has caused this Class B Note to be duly executed.

 

WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST,

as Issuer

 

By:U.S. Bank Trust National Association, not in its individual capacity but solely as Owner Trustee under the Trust Agreement

 

 

By:      ___________________________                                                              

 

Name:

Title:

 

Dated: ____________________, 20[__]

 

	  	
Exhibit A-3B (Page 4)

	  

  

  

 

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class B Notes described in the within-mentioned Indenture.

 

UNION BANK, N.A.,

as Indenture Trustee

 

By: _________________________________

          Authorized Signatory                                                                      

 

                       

Dated: ______________________________

	  	
Exhibit A-3B (Page 5)

	  

  

  

  

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS B SERIES 2012-B 3.50% ASSET BACKED NOTE

 

 

Summary of Terms and Conditions

 

This Class B Note is one of a duly authorized issue of Notes of the Issuer, designated as World Financial Network Credit Card Master Note Trust, Series 2012-B (the “Series 2012-B Notes”), issued under a Master Indenture dated as of August 1, 2001 (as amended and supplemented, the “Master Indenture”), between the Issuer and Union Bank, N.A., as indenture trustee (the “Indenture Trustee”), as supplemented by the Indenture Supplement dated as of July 19, 2012 (the “Indenture Supplement”), and representing the right to receive certain payments from the Issuer.  The term “Indenture,” unless the context otherwise requires, refers to the Master Indenture as supplemented by the Indenture Supplement.  The Notes are subject to all of the terms of the Indenture.  All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.  In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall control.

 

The Class A Notes, the Class M Notes, the Class C Notes and the Class D Notes will also be issued under the Indenture.

 

Payments of principal and interest on the Class B Notes are subordinated to payments of principal and interest on the Class A Notes and the Class M Notes pursuant to and in accordance with the Indenture.

 

The Noteholder, by its acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject to any liability under the Indenture.

 

This Note does not purport to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS B NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, WORLD FINANCIAL NETWORK BANK, WFN CREDIT COMPANY, LLC, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

 

The Issuer, the Transferor, the Indenture Trustee and any agent of the Issuer, the Transferor or the Indenture Trustee shall treat the person in whose name this Class B Note is registered as the owner hereof for all purposes, and neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be affected by notice to the contrary.

 

 

Exhibit A-3B (Page 6)

  

  

 

THIS CLASS B NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

	  	
Exhibit A-3B (Page 7)

	  

  

  

  

ASSIGNMENT

 

Social Security or other identifying number of assignee                                .

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto                                   (name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints                              attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

	
  

	
Dated: _________________________

	 Signature Guaranteed:__________________________**

 

 

 

  

    **The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

	  	
Exhibit A-3B (Page 8 )

	  

  

  

  

EXHIBIT A-4A

FORM OF DEFINITIVE CLASS C SERIES 2012-B 4.50% ASSET BACKED NOTE

 

THIS CLASS C NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THE NEXT SENTENCE.  BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER OF THIS CLASS C NOTE:

 

	
  

	
(1)  AGREES FOR THE BENEFIT OF THE ISSUER AND THE TRANSFEROR THAT THIS NOTE MAY BE SOLD, TRANSFERRED, ASSIGNED, PARTICIPATED, PLEDGED OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS, AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE l44A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (II) TO THE DEPOSITOR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES; AND

 

	
  

	
(2)  AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS CLASS C NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK (“WFNMT”), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION DOCUMENTS.

 

THE HOLDER OF THIS CLASS C NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS C NOTES AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

	  	
Exhibit A-4A (Page 1)

	  

  

  

  

 

BY YOUR ACQUISITION OF THIS NOTE OR ANY INTEREST HEREIN, YOU SHALL BE DEEMED TO REPRESENT, COVENANT AND AGREE, FOR THE BENEFIT OF THE ISSUER, THE INDENTURE TRUSTEE, THE UNDERWRITERS, THE SERVICER, WORLD FINANCIAL NETWORK BANK AND THE TRANSFEROR, THAT EITHER (A) YOU ARE NOT A BENEFIT PLAN (AS DEFINED BELOW) AND THAT YOU ARE NOT PURCHASING OR HOLDING SUCH NOTE OR ANY INTEREST HEREIN ON BEHALF OF, OR WITH THE ASSETS OF, A BENEFIT PLAN OR (B) YOUR PURCHASE, HOLDING AND DISPOSITION OF THIS NOTE OR INTEREST HEREIN WILL NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA (AS DEFINED BELOW), SECTION 4975 OF THE CODE (AS DEFINED BELOW) OR ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW.  FOR THESE PURPOSES, A “BENEFIT PLAN” INCLUDES AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, A “PLAN” (AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF SUCH EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY OR ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION SECTIONS OF ERISA OR SECTION 4975 OF THE CODE.

 

TRANSFER OF THIS NOTE IS SUBJECT TO RESTRICTIONS AS PROVIDED IN THE INDENTURE SUPPLEMENT.  NO TRANSFER OF THIS NOTE SHALL BE MADE BY WORLD FINANCIAL NETWORK BANK (“WFN”), THE TRANSFEROR OR ANY PERSON WHICH IS CONSIDERED THE SAME PERSON AS WFN OR THE TRANSFEROR FOR U.S. FEDERAL INCOME TAX PURPOSES (EXCEPT TO A PERSON WHICH IS CONSIDERED THE SAME PERSON AS WFN FOR SUCH PURPOSES) AND ANY SUCH TRANSFER SHALL BE VOID AB INITIO UNLESS AN OPINION OF COUNSEL IS FIRST DELIVERED TO THE INDENTURE TRUSTEE TO THE EFFECT THAT SUCH NOTES WILL CONSTITUTE DEBT FOR U.S. FEDERAL INCOME TAX PURPOSES; PROVIDED THAT THIS NOTE MAY BE PLEDGED TO A FEDERAL RESERVE BANK PROVIDED THAT THE  PLEDGE THEREOF AND THE EXERCISE OF REMEDIES BY THE FEDERAL RESERVE BANK IN CONNECTION THEREWITH SHALL BE SUBJECT TO THE REQUIREMENT THAT THIS NOTE SHALL NOT BE FURTHER TRANSFERRABLE UNLESS AN OPINION OF COUNSEL IS FIRST DELIVERED TO THE INDENTURE TRUSTEE TO THE EFFECT THAT SUCH NOTES WILL CONSTITUTE DEBT FOR U.S. FEDERAL INCOME TAX PURPOSES.

 

	 	
Exhibit A-4A (Page 2 )

	  

  

  

 

REGISTERED $54,167,000

 

No. R-                      CUSIP NO. 981464 DE7

 

                                                                                          

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS C SERIES 2012-B 4.50% ASSET BACKED NOTE

 

World Financial Network Credit Card Master Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust governed by an Amended and Restated Trust Agreement dated as of August 1, 2001 (as amended and supplemented), for value received, hereby promises to pay to ___________, or registered assigns, subject to the following provisions, the principal sum of FIFTY FOUR MILLION ONE HUNDRED SIXTY SEVEN THOUSAND DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the May 2021 Distribution Date, except as otherwise provided below or in the Indenture.  The Issuer will pay interest on the unpaid principal amount of this Note at the Class C Note Interest Rate on each Distribution Date until the principal amount of this Note is paid in full.  Interest on this Note will accrue for each Distribution Date from and including the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, for the initial Distribution Date, from and including the Closing Date to but excluding such Distribution Date.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.  Principal of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.

 

The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.

 

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture or the Indenture Supplement referred to on the reverse hereof, or be valid for any purpose.

 

THIS CLASS C NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A NOTES, THE CLASS M NOTES AND THE CLASS B NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.

 

	 	
Exhibit A-4A (Page 3 )

	  

  

  

  

IN WITNESS WHEREOF, the Issuer has caused this Class C Note to be duly executed.

 

WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST,

as Issuer

 

By:           U.S. Bank Trust National Association, not in its individual capacity but solely as Owner Trustee under the Trust Agreement

 

 

By:     __________________________                                                                 

 

Name:

Title:

 

Dated:  ____________, 20[__]

 

	 	
Exhibit A-4A (Page 4)

	  

  

  

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class C Notes described in the within-mentioned Indenture.

 

UNION BANK, N.A., as Indenture Trustee

 

By:    _____________________________________                                                                     

                Authorized Signatory

 

Dated: ____________________________________

 

 

 

	 	
Exhibit A-4A (Page 5)

	  

 

 

  

  

  

 

 

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS C SERIES 2012-B 4.50% ASSET BACKED NOTE

 

 

Summary of Terms and Conditions

 

This Class C Note is one of a duly authorized issue of Notes of the Issuer, designated as World Financial Network Credit Card Master Note Trust, Series 2012-B (the “Series 2012-B Notes”), issued under a Master Indenture dated as of August 1, 2001 (as amended and supplemented, the “Master Indenture”), between the Issuer and Union Bank, N.A., as indenture trustee (the “Indenture Trustee”), as supplemented by the Indenture Supplement dated as of July 19, 2012 (the “Indenture Supplement”), and representing the right to receive certain payments from the Issuer.  The term “Indenture,” unless the context otherwise requires, refers to the Master Indenture as supplemented by the Indenture Supplement.  The Notes are subject to all of the terms of the Indenture.  All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.  In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall control.

 

The Class A Notes, the Class M Notes, the Class B Notes and the Class D Notes will also be issued under the Indenture.  Payments of principal and interest on the Class C Notes are subordinated to payments of principal and interest on the Class A Notes, the Class M Notes and the Class B Notes pursuant to and in accordance with the Indenture.

 

The Noteholder, by its acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject to any liability under the Indenture.

 

This Note does not purport to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS C NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, WORLD FINANCIAL NETWORK BANK, WFN CREDIT COMPANY, LLC, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

 

The Issuer, the Transferor, the Indenture Trustee and any agent of the Issuer, the Transferor or the Indenture Trustee shall treat the person in whose name this Class C Note is registered as the owner hereof for all purposes, and neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be affected by notice to the contrary.

 

Exhibit A-4A (Page 6)

  

  

 

 

THIS CLASS C NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

	 	
Exhibit A-4A (Page 7 )

	  

  

  

  

ASSIGNMENT

 

Social Security or other identifying number of assignee

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto                                   (name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints                              attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

    Dated:  ___________________________                

                         Signature Guaranteed:______________________________**

 

  

    **The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

	 	
Exhibit A-4A (Page 8 )

	  

  

  

  

EXHIBIT A-4B

FORM OF GLOBAL CLASS C SERIES 2012-B 4.50% ASSET BACKED NOTE

 

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THIS CLASS C NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THE NEXT SENTENCE.  BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER OF THIS CLASS C NOTE:

 

	
  

	
(1)  AGREES FOR THE BENEFIT OF THE ISSUER AND THE TRANSFEROR THAT THIS NOTE MAY BE SOLD, TRANSFERRED, ASSIGNED, PARTICIPATED, PLEDGED OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS, AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE l44A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (II) TO THE DEPOSITOR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES; AND

 

	
  

	
(2)  AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS CLASS C NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK (“WFNMT”), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION DOCUMENTS.

 

Exhibit A-4B (Page 1)

  

  

  

    THE HOLDER OF THIS CLASS C NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS C NOTES AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

BY YOUR ACQUISITION OF THIS NOTE OR ANY INTEREST HEREIN, YOU SHALL BE DEEMED TO REPRESENT, COVENANT AND AGREE, FOR THE BENEFIT OF THE ISSUER, THE INDENTURE TRUSTEE, THE UNDERWRITERS, THE SERVICER, WORLD FINANCIAL NETWORK BANK AND THE TRANSFEROR, THAT EITHER (A) YOU ARE NOT A BENEFIT PLAN (AS DEFINED BELOW) AND THAT YOU ARE NOT PURCHASING OR HOLDING SUCH NOTE OR ANY INTEREST HEREIN ON BEHALF OF, OR WITH THE ASSETS OF, A BENEFIT PLAN OR (B) YOUR PURCHASE, HOLDING AND DISPOSITION OF THIS NOTE OR INTEREST HEREIN WILL NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA (AS DEFINED BELOW), SECTION 4975 OF THE CODE (AS DEFINED BELOW) OR ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW.  FOR THESE PURPOSES, A “BENEFIT PLAN” INCLUDES AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, A “PLAN” (AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF SUCH EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY OR ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION SECTIONS OF ERISA OR SECTION 4975 OF THE CODE.

 

	  	
Exhibit A-4B (Page 2)

	  

  

  

  

REGISTERED  $54,167,000

 

No. R-                      CUSIP NO. 981464 DE7

 

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS C SERIES 2012-B 4.50% ASSET BACKED NOTE

 

World Financial Network Credit Card Master Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust governed by an Amended and Restated Trust Agreement dated as of August 1, 2001 (as amended and supplemented), for value received, hereby promises to pay to Cede & Co., or registered assigns, subject to the following provisions, the principal sum of FIFTY FOUR MILLION ONE HUNDRED SIXTY SEVEN THOUSAND DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the May 2021 Distribution Date, except as otherwise provided below or in the Indenture.  The Issuer will pay interest on the unpaid principal amount of this Note at the Class C Note Interest Rate on each Distribution Date until the principal amount of this Note is paid in full.  Interest on this Note will accrue for each Distribution Date from and including the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, for the initial Distribution Date, from and including the Closing Date to but excluding such Distribution Date.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.  Principal of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.

 

The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.

 

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture or the Indenture Supplement referred to on the reverse hereof, or be valid for any purpose.

 

THIS CLASS C NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A NOTES, THE CLASS M NOTES AND THE CLASS B NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.

 

	  	
Exhibit A-4B (Page 3)

	  

  

  

  

IN WITNESS WHEREOF, the Issuer has caused this Class C Note to be duly executed.

 

WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST,

as Issuer

 

By:           U.S. Bank Trust National Association, not in its individual capacity but solely as Owner Trustee under the Trust Agreement

 

 

By:    __________________________                                                                     

 

Name:

Title:

 

Dated:  ____________________, 20[__]

 

	  	
Exhibit A-4B (Page 4)

	  

  

  

  

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class C Notes described in the within-mentioned Indenture.

 

UNION BANK, N.A., as Indenture Trustee

 

By:    ____________________________________

             Authorized Signatory                                                                   

 

 Dated: __________________________________

	  	
Exhibit A-4B (Page 5)

	  

  

  

  

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS C SERIES 2012-B 4.50% ASSET BACKED NOTE

 

 

Summary of Terms and Conditions

 

This Class C Note is one of a duly authorized issue of Notes of the Issuer, designated as World Financial Network Credit Card Master Note Trust, Series 2012-B (the “Series 2012-B Notes”), issued under a Master Indenture dated as of August 1, 2001 (as amended and supplemented, the “Master Indenture”), between the Issuer and Union Bank, N.A., as indenture trustee (the “Indenture Trustee”), as supplemented by the Indenture Supplement dated as of July 19, 2012 (the “Indenture Supplement”), and representing the right to receive certain payments from the Issuer.  The term “Indenture,” unless the context otherwise requires, refers to the Master Indenture as supplemented by the Indenture Supplement.  The Notes are subject to all of the terms of the Indenture.  All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.  In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall control.

 

The Class A Notes, the Class M Notes, the Class B Notes and the Class D Notes will also be issued under the Indenture.  Payments of principal and interest on the Class C Notes are subordinated to payments of principal and interest on the Class A Notes, the Class M Notes and the Class B Notes pursuant to and in accordance with the Indenture.

 

The Noteholder, by its acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject to any liability under the Indenture.

 

This Note does not purport to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS C NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, WORLD FINANCIAL NETWORK BANK, WFN CREDIT COMPANY, LLC, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

 

The Issuer, the Transferor, the Indenture Trustee and any agent of the Issuer, the Transferor or the Indenture Trustee shall treat the person in whose name this Class C Note is registered as the owner hereof for all purposes, and neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be affected by notice to the contrary.

 

 

Exhibit A-4B (Page 6)

  

  

  

THIS CLASS C NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

	  	
Exhibit A-4B (Page 7)

	  

  

  

  

ASSIGNMENT

 

Social Security or other identifying number of assignee

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto                                   (name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints                              attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

 

    Dated: _______________________________    

                        Signature Guaranteed: _______________________________**

 

  

    **The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

	  	
Exhibit A-4B (Page 8)

	  

  

  

  

EXHIBIT A-5A

FORM OF DEFINITIVE CLASS D SERIES 2012-B 0.00% ASSET BACKED NOTE

 

THIS CLASS D NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THE NEXT SENTENCE.  BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER OF THIS CLASS D NOTE:

 

	
  

	
(1)  AGREES FOR THE BENEFIT OF THE ISSUER AND THE TRANSFEROR THAT THIS NOTE MAY BE SOLD, TRANSFERRED, ASSIGNED, PARTICIPATED, PLEDGED OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE LAWS, AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE l44A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE, OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (II) TO THE DEPOSITOR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES; AND

 

	
  

	
(2)  AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS CLASS D NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK (“WFNMT”), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION DOCUMENTS.

 

THE HOLDER OF THIS CLASS D NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS D NOTES AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME, UNLESS AND UNTIL OTHERWISE REQUIRED BY AN APPLICABLE TAXING AUTHORITY.

 

Exhibit A-5A (Page 1)

  

  

  

 

BY YOUR ACQUISITION OF THIS NOTE OR ANY INTEREST HEREIN, YOU SHALL BE DEEMED TO REPRESENT, COVENANT AND AGREE, FOR THE BENEFIT OF THE ISSUER, THE INDENTURE TRUSTEE, THE SERVICER, WORLD FINANCIAL NETWORK BANK AND THE TRANSFEROR, THAT YOU ARE NOT A BENEFIT PLAN (AS DEFINED BELOW) AND THAT YOU ARE NOT PURCHASING OR HOLDING SUCH NOTE OR ANY INTEREST HEREIN ON BEHALF OF, OR WITH THE ASSETS OF, A BENEFIT PLAN.  FOR THESE PURPOSES, A “BENEFIT PLAN” INCLUDES AN “EMPLOYEE BENEFIT PLAN” (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION PROVISIONS OF ERISA, A “PLAN” (AS DEFINED IN SECTION 4975(e)(1) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, ANY ENTITY WHOSE UNDERLYING ASSETS INCLUDE “PLAN ASSETS” BY REASON OF SUCH EMPLOYEE BENEFIT PLAN’S OR PLAN’S INVESTMENT IN THE ENTITY OR ANY OTHER PLAN THAT IS SUBJECT TO ANY LAW SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY OR PROHIBITED TRANSACTION SECTIONS OF ERISA OR SECTION 4975 OF THE CODE.

 

TRANSFER OF THIS NOTE IS SUBJECT TO RESTRICTIONS AS PROVIDED IN THE INDENTURE SUPPLEMENT.  NO TRANSFER OF THIS NOTE SHALL BE MADE BY WORLD FINANCIAL NETWORK BANK (“WFN”), THE TRANSFEROR OR ANY PERSON WHICH IS CONSIDERED THE SAME PERSON AS WFN OR THE TRANSFEROR FOR U.S. FEDERAL INCOME TAX PURPOSES (EXCEPT TO A PERSON WHICH IS CONSIDERED THE SAME PERSON AS WFN FOR SUCH PURPOSES) AND ANY SUCH TRANSFER SHALL BE VOID AB INITIO UNLESS AN OPINION OF COUNSEL IS FIRST DELIVERED TO THE INDENTURE TRUSTEE TO THE EFFECT THAT SUCH NOTES WILL CONSTITUTE DEBT FOR U.S. FEDERAL INCOME TAX PURPOSES; PROVIDED THAT THIS NOTE MAY BE PLEDGED TO A FEDERAL RESERVE BANK PROVIDED THAT THE  PLEDGE THEREOF AND THE EXERCISE OF REMEDIES BY THE FEDERAL RESERVE BANK IN CONNECTION THEREWITH SHALL BE SUBJECT TO THE REQUIREMENT THAT THIS NOTE SHALL NOT BE FURTHER TRANSFERRABLE UNLESS AN OPINION OF COUNSEL IS FIRST DELIVERED TO THE INDENTURE TRUSTEE TO THE EFFECT THAT SUCH NOTES WILL CONSTITUTE DEBT FOR U.S. FEDERAL INCOME TAX PURPOSES.

 

	  	
Exhibit A-5A (Page 2)

	  

  

  

 

REGISTERED  $17,334,000

 

No. R-                      CUSIP NO. 981464 DF4

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST SERIES 2012-B

 

 

CLASS D SERIES 2012-B 0.00% ASSET BACKED NOTE

 

World Financial Network Credit Card Master Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust governed by an Amended and Restated Trust Agreement dated as of August 1, 2001 (as amended and supplemented), for value received, hereby promises to pay to ___________, or registered assigns, subject to the following provisions, the principal sum of SEVENTEEN MILLION THREE HUNDRED THIRTY FOUR THOUSAND DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the May 2021 Distribution Date, except as otherwise provided below or in the Indenture.  The Issuer will pay interest on the unpaid principal amount of this Note at the Class D Note Interest Rate on each Distribution Date until the principal amount of this Note is paid in full.  Interest on this Note will accrue for each Distribution Date from and including the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, for the initial Distribution Date, from and including the Closing Date to but excluding such Distribution Date.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.  Principal of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.

 

The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.

 

Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.

 

Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture or the Indenture Supplement referred to on the reverse hereof, or be valid for any purpose.

 

THIS CLASS D NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A NOTES, THE CLASS M NOTES, THE CLASS B NOTES AND THE CLASS C NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.

 

	  	
Exhibit A-5A (Page 3)

	  

  

  

  

IN WITNESS WHEREOF, the Issuer has caused this Class D Note to be duly executed.

 

WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST,

as Issuer

 

By:           U.S. Bank Trust National Association, not in its individual capacity but solely as Owner Trustee under the Trust Agreement

 

 

By:    __________________________                                                            

 

Name:

Title:

 

Dated:  _________________, 20[__]

 

	  	
Exhibit A-5A (Page 4)

	  

  

  

 

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class D Notes described in the within-mentioned Indenture.

 

UNION BANK, N.A., as Indenture Trustee

 

By:  ____________________________________

             Authorized Signatory                                                                   

 

    

Dated: __________________________________

	  	
Exhibit A-5A (Page 5)

	  

  

 

 

  

WORLD FINANCIAL NETWORK CREDIT CARD

MASTER NOTE TRUST SERIES 2012-B

 

CLASS D SERIES 2012-B 0.00% ASSET BACKED NOTE

 

 

Summary of Terms and Conditions

 

This Class D Note is one of a duly authorized issue of Notes of the Issuer, designated as World Financial Network Credit Card Master Note Trust, Series 2012-B (the “Series 2012-B Notes”), issued under a Master Indenture dated as of August 1, 2001 (as amended and supplemented, the “Master Indenture”), between the Issuer and Union Bank, N.A., as indenture trustee (the “Indenture Trustee”), as supplemented by the Indenture Supplement dated as of July 19, 2012 (the “Indenture Supplement”), and representing the right to receive certain payments from the Issuer.  The term “Indenture,” unless the context otherwise requires, refers to the Master Indenture as supplemented by the Indenture Supplement.  The Notes are subject to all of the terms of the Indenture.  All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture.  In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall control.

 

The Class A Notes, the Class M Notes, the Class B Notes and the Class C Notes will also be issued under the Indenture.  Payments of principal and interest on the Class D Notes are subordinated to payments of principal and interest on the Class A Notes, the Class M Notes, the Class B Notes and the Class C Notes pursuant to and in accordance with the Indenture.

 

The Noteholder, by its acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject to any liability under the Indenture.

 

This Note does not purport to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS D NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, WORLD FINANCIAL NETWORK BANK, WFN CREDIT COMPANY, LLC, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.

 

The Issuer, the Transferor, the Indenture Trustee and any agent of the Issuer, the Transferor or the Indenture Trustee shall treat the person in whose name this Class D Note is registered as the owner hereof for all purposes, and neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be affected by notice to the contrary.

 

THIS CLASS D NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

	  	
Exhibit A-5A (Page 6)

	  

  

  

  

ASSIGNMENT

 

Social Security or other identifying number of assignee

 

FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto                                   (name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints                              attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

    Dated:  _________________________________            

                            Signature Guaranteed:  ______________________________**

 

 

 

  

    **The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

	  	
Exhibit A-5A (Page 7)

	  

 

  

 

 

EXHIBIT B

 

FORM OF MONTHLY PAYMENT INSTRUCTIONS AND

 

NOTIFICATION TO INDENTURE TRUSTEE

 

	
WORLD FINANCIAL NETWORK BANK

	
WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST Series 2006-A, 2009-B, 2009-D, 2010-A, 2011-A, 2011-B and 2012-A

	
MONTHLY PERIOD ENDING

	
[                                     ]

I.  INSTRUCTIONS TO MAKE CERTAIN PAYMENTS

 

WFN, as Servicer does hereby instruct The Bank of New York Mellon Trust Company, N.A., as Indenture Trustee, to pay in accordance with the Series 2006-A Indenture Supplement, dated as of April 28, 2006, the Series 2009-B Indenture Supplement, dated as of August 13, 2009, the Series 2009-D Indenture Supplement, dated as of August 13, 2009, the Series 2010-A Indenture Supplement, dated as of July 8, 2010, the Series 2011-A Indenture Supplement, dated as of November 9, 2011, the Series 2011-B Indenture Supplement, dated as of November 9, 2011, and the Series 2012-A Indenture Supplement, dated as of April 12, 2012 [additional indenture supplements as applicable from time to time] (each, an “Indenture Supplement”) from the Distribution Account (or other Series Account as specified below) on [ ] which date is a Transfer Date under each Indenture Supplement, amounts so deposited pursuant to each Indenture Supplement as set below. Defined terms used herein have the meanings specified in the related Indenture Supplements.

 

 

	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 2011-B

	  	

Series 2012-A

	  	

 

Total

	
INTEREST PAYMENTS

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(From Distribution Accounts)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
1.Amount to be distributed to the Class A Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
2.Amount to be distributed to the Class M Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
3.Amount to be distributed to the Class B Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
4.Amount to be distributed to the Class C Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
5.Amount to be distributed to the Class D Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
6.Amount to be distributed to the Swap Provider

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
7.Amount to be received from the Swap Provider

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  

 

 

 

	  	
Exhibit B (Page 1)

	  

  

  

  

	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 2011-B

	  	

Series 2012-A

	  	

 

Total

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
8.Amount to be returned to WFN

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
PRINCIPAL PAYMENTS

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(From Principal Accounts)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
1.Amount to be distributed to the Class A Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
2.Amount to be distributed to the Class M Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
3.Amount to be distributed to the Class B Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
4.Amount to be distributed to the Class C Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
5.Amount to be distributed to the Class D Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
TRANSFER OF INTEREST EARNINGS

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(from Accounts below to Finance Charge Accounts)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
1.Cash Collateral Account (if applicable)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
2.Spread Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
3.Principal Accumulation Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
4.Principal Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
5.Reserve Account

 

 

	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  

	
World Financial Network Bank, as Servicer

By:____________________________

Name:_________________________

Title:__________________________

 

	  	
Exhibit B (Page 2)

	  

  

  

  

EXHIBIT C

 

FORM OF MONTHLY NOTEHOLDERS’ STATEMENT

 

MONTHLY NOTEHOLDER’S STATEMENT

 

WORLD FINANCIAL NETWORK CREDIT CARD

 

MASTER NOTE TRUST

 

SERIES 2006-A, SERIES 2009-B, SERIES 2009-D,

 

SERIES 2010-A, SERIES 2011-A, SERIES 2011-B AND SERIES 2012-A

 

Pursuant to the Master Indenture, dated as of August 1, 2001, (as amended and supplemented, the “Indenture”) between World Financial Network Credit Card Master Note Trust (the “Issuer”) and The Bank of New York Mellon Trust Company, N.A., as indenture trustee (the “Indenture Trustee”), the Series 2006-A Indenture Supplement, dated as of April 28, 2006, the Series 2009-A Indenture Supplement, dated as of April 14, 2009, the Series 2009-B Indenture Supplement, dated as of August 13, 2009, the Series 2009-D Indenture Supplement, dated as of August 13, 2009, the Series 2010-A Indenture Supplement, dated as of July 8, 2010, the Series 2011-A Indenture Supplement, dated as of November 9, 2011, the Series 2011-B Indenture Supplement, dated as of November 9, 2011, and the Series 2012-A Indenture Supplement, dated as of April 12, 2012 (each, an “Indenture Supplement”), World Financial Network Bank, as Servicer (the “Servicer”) under the Transfer and Servicing Agreement, dated as of August 1, 2001 (as amended, the “Transfer and Servicing Agreement”) between the Servicer, WFN Credit Company, LLC, as Transferor and the Issuer, is required to prepare certain information each month regarding current distributions to the Noteholders and the performance of the Trust during the previous month.  The information required to be prepared with respect to the Distribution Date of [  ], 20[  ], and with respect to the performance of the Trust during the month of [  ], 20[  ] is set forth below.  Capitalized terms herein are defined in the Indenture and the Indenture Supplements.

 

 

	  	
Monthly Period:

	  
	  	
Determination Date:

	  
	  	
Distribution Date:

	  
	  	
Number of Days in Period:

	  
	  	
Number of Days in Month:

	  
	  	
Record Date:

	  

 

I. DEAL PARAMETERS

 

	  	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
(a) Class A Initial Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b) Class M Initial Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c) Class B Initial Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d) Class C Initial Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(e) Class D Initial Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(f) Total Initial Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(g) Class A Initial Note Principal Balance %

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(h) Class M Initial Note Principal

Balance %

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(i) Class B Initial Note Principal Balance %

	  	  	  	  	  	  	  	  	  	  	  	  	  	  

 

 

	  	
Exhibit C (Page 1)

	  

  

  

  

	  	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
(j) Class C Initial Note Principal Balance %

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(k) Class D Initial Note Principal Balance %

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(l) Required Retained Transferor Percentage

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(m) Additional Minimum Transferor Percentage (2% Nov-Jan; 0% otherwise)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(n) LIBOR rate as of most recent reset day

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(o) Class A Rate

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(p) Class A Swap Rate, if applicable

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(q) Class M Rate

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(r) Class M Swap Rate, if applicable

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(s) Class B Rate

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(t) Class B Swap Rate, if applicable

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(u) Class C Rate

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(v) Class C Swap Rate, if applicable

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(w) Class D Rate

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(x) Class D Swap Rate, if applicable

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(y) Servicing Fee Percentage

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  

 

II. COLLATERAL AMOUNTS AND ALLOCATION PERCENTAGES

	  	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
Monthly Period

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(a) Initial Collateral Amount

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b) Principal Payments made to Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c) Principal Accumulation Account Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d) Unreimbursed Investor Charge-offs and Reallocated Principal Collections

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(e) Collateral Amount- End of Current Monthly Period

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(f) Beginning Class A Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(g) Beginning Class M Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(h) Beginning Class B Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(i) Beginning Class C Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(j) Beginning Class D Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(k) Total Beginning Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(l) Ending Class A Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(m) Ending Class M Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(n) Ending Class B Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(o) Ending Class C Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(p) Ending Class D Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(q) Total Ending Note Principal Balance

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(r) Allocation Percentage- Finance Charges Collections and Default Amounts

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(s) Allocation Percentage- Principal Collections

	  	  	  	  	  	  	  	  	  	  	  	  	  	  

	  	
Exhibit C (Page 2)

	  

  

  

  

III. RECEIVABLES IN THE TRUST

 

	  	  	

Series

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
(a) Beginning of the Month Principal Receivables

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b) Collection of Principal Receivables

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c) Defaulted Receivables (principal charge-offs):

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d) Dilution (Principal net of Debit Adjustments):

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(e) Sales (principal receivables generated):

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(f) Net (Removal)/Addition of Principal Receivables:

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(g) End of Month Principal Receivables (a - b - c - d + e + f)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(h) Recoveries of previously Charged-off Receivables:

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(i)  Beginning of the Month Finance Charge Receivables

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(j)  End of the Month Finance Charge Receivables

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  

	  	
Exhibit C (Page 3)

	  

  

  

  

IV.  RECEIVABLES PERFORMANCE SUMMARY

	  	  	

Series

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
COLLECTIONS:

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(a) Collections of Principal Receivables

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b) Collections of Finance Charge Receivables

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c) Total Collections (a+b).

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d) Monthly Payment Rate (% of Beginning Total Receivables Outstanding)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
DELINQUENCIES AND LOSSES:

	  	

Series

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
End of the month delinquencies:

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(e) 1-30 days delinquent (CA1)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(f) 31-60 days delinquent (CA2)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(g) 61-90 days delinquent (CA3)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(h) 91-120 days delinquent (CA4)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(i) 121-150 days delinquent (CA5)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(j) 151+ days delinquent (CA6)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(k) Total delinquencies (e +f + g  + h + i + j)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
CHARGE-OFFS:

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(l) Defaulted Receivables (principal charge-offs):

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(m) Recoveries of previously Charged-off Receivables

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(n) Gross Principal Charge-Offs (% of End of Month Total Principal Receivables)

(annualized)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(o) Net Principal Charge-Offs (% of End of Month Total Principal Receivables)

(annualized)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  

 

V.  TRANSFEROR INTEREST

	  	  	

Series

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
(a) Required Retained Transferor Percentage

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b) Additional Minimum Transferor Percentage (2% Nov-Jan; 0% otherwise)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c) Beginning Transferor’s Amount

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d) Ending Transferor’s Amount

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(e) Minimum Transferor’s Amount

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(f) Excess Funding Account Balance at end of Monthly Period

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(g) Principal Accounts Balance at end of Monthly Period

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(h) Sum of Principal Receivables, Excess Funding Account and Principal Accounts at end of Monthly Period

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  

 

	  	
Exhibit C (Page 4)

	  

  

  

  

VI.  TRUST ACCOUNT BALANCES AND EARNINGS

	  	  	

Series

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
BEGINNING ACCOUNT BALANCES:

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(a) Finance Charge Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b) Cash Collateral Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c) Spread Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d) Reserve Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(e) Principal Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(f) Principal Accumulation Account

 

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
ENDING ACCOUNT BALANCES:

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
(g) Finance Charge Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(h) Cash Collateral Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(i) Spread Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(j) Reserve Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(k) Principal Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(l) Principal Accumulation Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
INTEREST AND EARNINGS:

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
(m) Interest and Earnings on Finance Charge Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(n) Interest and Earnings on Cash Collateral Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(o) Interest and Earnings on Spread Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(p) Interest and Earnings on Reserve Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(q) Interest and Earnings on Principal Accumulation Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(r) Interest and Earnings on Principal Funding Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  

VII.  ALLOCATION AND APPLICATION of COLLECTIONS

	  	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
APPLICATIONS OF FINANCE CHARGE COLLECTIONS:

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(a) Floating Allocation of Finance Charges

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b) Class A Monthly Interest

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c) Class A Swap Payment Due to (from) Swap Provider, if applicable

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d) Class M Monthly Interest

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(e) Class M Swap Payment Due to (from) Swap Provider, if applicable

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(f) Class B Monthly Interest

	  	  	  	  	  	  	  	  	  	  	  	  	  	  

 

	  	
Exhibit C (Page 5)

	  

  

  

  

	 	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
(g) Class B Swap Payment Due to (from) Swap Provider, if applicable

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(h) Servicing Fee (Beginning Collateral Amount*2%/12)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(i) Class C Monthly Interest

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(j) Class C Swap Payment Due to (from) Swap Provider, if applicable

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(k) Class D Monthly Interest

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(l) Class D Swap Payment Due to (from) Swap Provider, if applicable

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(m) Investor Default Amounts

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(n) Uncovered Dilution Amounts

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(o) Unreimbursed Investor Chargeoffs and Reallocated Principal Collections

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(p) Required to be Deposited into Cash Collateral Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(q) Required Reserve Account Amount

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(r) Required to be Deposited into the Spread Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(s) Required Payments and Deposits Relating to Interest Rate Swaps

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(t) Other Payments Required to be made

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(u) Excess Finance Charge Collections (a-b-c-d-e-f-g-h-i-j-k-l-m-n-o-p-q-r-s-t)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
APPLICATION OF PRINCIPAL COLLECTIONS:

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	

Series

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
(a) Investor Principal Collections

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b) Less Reallocated Principal Collections

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c) Plus Shared Principal Collections from other Principal Sharing Series

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d) Plus Aggregate amount of Finance Charge Collections applied to cover Defaults and Uncovered Dilution and to be treated as Available Principal Collections

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(e) Available Principal Collections (a+b+c+d)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(f) Deposits to Principal Accumulation Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(g) Monthly Principal applied for payments to the Class A Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(h) Monthly Principal applied for payments to the Class M Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(i) Monthly Principal applied for payments to the Class B Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(j) Monthly Principal applied for payments to the Class C Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(k) Monthly Principal applied for payments to the Class D Noteholders

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(l) Shared Principal Collections applied to other Principal Sharing

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  

 

	  	
Exhibit C (Page 6)

	  

  

  

  

VIII.  INVESTOR CHARGE-OFFS

	  	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series

2011-B

	  	

Series 

2012-A

	
(a) Investor Defaults and Uncovered Dilution

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b) Reimbursed from Available Funds

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c) Reimbursed from Cash Collateral Account

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d) Total reimbursed in respect of Investor Defaults and Dilution

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(e) Investor Charge-off (a - d)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  

 

IX.  YIELD AND BASE RATE

	  	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
Base Rate

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(Monthly interest, any net swap payments and monthly servicing fees divided by collateral amounts plus amounts on deposit in the principal accumulation account)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(a) Base Rate (current month)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b) Base Rate (prior month)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c) Base Rate (2 months prior)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d) 3 Month Average Base Rate

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
Portfolio Yield

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(Finance charge collections less defaults allocable to each series divided by collateral amounts plus amounts on deposit in the principal accumulation account)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(e) Portfolio Yield (current month)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(f) Portfolio Yield (prior month)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(g) Portfolio Yield (2 months prior)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(h) 3 Month Average Portfolio Yield

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
Excess Spread Percentage

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(Portfolio Yield less Base Rate)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(i) Portfolio Adjusted Yield (current month)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(j) Portfolio Adjusted Yield (prior month)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(k) Portfolio Adjusted Yield (2 months prior)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(l) Portfolio Adjusted Yield (3 month average)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  

 

	  	
Exhibit C (Page 7)

	  

  

  

  

IX.  PRINCIPAL ACCUMULATION ACCOUNT

	  	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
(a)Cumulative Class A principal distributed to PAA (as of prior distribution date)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b)Class A Principal deposited in the Principal Accumulation Account (PAA)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c)Total Class A Principal deposited in the PAA (a + b)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d)Cumulative Class M principal distributed to PAA (as of prior distribution date)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(e)Class M Principal deposited in the Principal Accumulation Account (PAA)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(f)Total Class M Principal deposited in the PAA (d +e)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(g)Cumulative Class B principal distributed to PAA (as of prior distribution date)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(h)Class B Principal deposited in the Principal Accumulation Account (PAA)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(i)Total Class B Principal deposited in the PAA (g + h)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(j)Cumulative Class C principal distributed to PAA (as of prior distribution date)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(k)Class C Principal deposited in the Principal Accumulation Account (PAA)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(l)Total Class C Principal deposited in the PAA (j + k)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(m)Cumulative Class D principal distributed to PAA (as of prior distribution date)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(n)Class D Principal deposited in the Principal Accumulation Account (PAA)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(o)Total Class D Principal deposited in the PAA (m + n)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(m)Ending PAA balance (c + f + i + l + o)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	  	  	  	  	  	  	  	  	  	  	  	  	  	  	  

X.  PRINCIPAL REPAYMENT

	  	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
(a) Class A Principal Paid (as of prior distribution dates)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(b) Class A Principal Payments

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(c) Total Class A Principal Paid (a + b)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(d) Class M Principal Paid (as of prior distribution dates)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  

 

 

	  	
Exhibit C (Page 8)

	  

  

  

  

	 	  	

Series 

2006-A

	  	

Series

2009-B

	  	

Series

2009-D

	  	

Series

2010-A

	  	

Series

2011-A

	  	

Series 

2011-B

	  	

Series 

2012-A

	
(e) Class M Principal Payments

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(f) Total Class M Principal Paid (d + e)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(g) Class B Principal Paid (as of prior distribution dates)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(h) Class B Principal Payments

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(i) Total Class B Principal Paid (g + h)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(j) Class C Principal Paid (as of prior distribution dates)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(k) Class C Principal Payments

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(l) Total Class C Principal Paid (j + k)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(m) Class D Principal Paid (as of prior distribution dates)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(n) Class D Principal Payments

	  	  	  	  	  	  	  	  	  	  	  	  	  	  
	
(o) Total Class D Principal Paid (m + n)

	  	  	  	  	  	  	  	  	  	  	  	  	  	  

	  	
World Financial Network Bank, as Servicer

By:____________________________

Name:_________________________

Title:__________________________

 

	  

 

 

	  	
Exhibit C (Page 9)

	  

  

  

  

SCHEDULE 1

 

 

PERFECTION COVENANTS

 

Indenture Trustee covenants that it shall retain possession of the Collateral Certificate and that it shall not cause or allow possession of the Collateral Certificate to be transferred to any other entity, including any Affiliate of Indenture Trustee, unless (i) the Indenture Trustee provides written notice of its intent to transfer possession of the Collateral Certificate to the Owner Trustee, the Issuer and the Administrator at least sixty (60) days prior to such transfer,  (ii) each of the Issuer and the Indenture Trustee receives an Opinion of Counsel of the Administrator stating that the Indenture Trustee will continue to have a perfected security interest in the Collateral Certificate free of any adverse claim and (iii) the Indenture Trustee receives a certificate of the Administrator, on behalf of the Issuer, signed by the Chairman of the Board, President, any Vice President or the Treasurer or any Assistant Treasurer, stating that the lien of the Indenture continues to constitute a valid first priority perfected security interest in the Collateral Certificate (other than with respect to a tax, mechanics or similar lien).

 

 

 

-1-

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