Document:

exv10w2

 

Exhibit 10.2

AMERICAN SHARED HOSPITAL SERVICES

LONG-TERM INCENTIVE COMPENSATION PLAN

ARTICLE I

NAME AND PURPOSE

     1.01 Purpose. American Shared Hospital Services, a corporation duly organized and
existing under the laws of State of California (the “Corporation”), hereby establishes the American
Shared Hospital Services Long-Term Incentive Compensation Plan (the “Plan”) in order to provide a
select group of management and other highly compensated individuals in the Corporation’s employ
with the opportunity to earn additional incentive compensation contingent upon the Corporation’s
attainment of pre-established performance objectives and their completion of designated service
periods and to defer any compensation so earned until the expiration of a designated period of
time, their separation from service with the Corporation or a substantial change in the control or
ownership of the Corporation. The deferral features of the Plan shall function as a so-called “top
hat” plan of deferred compensation and shall be subject to the provisions of the Employee
Retirement Income Security Act of 1974 (as amended from time to time) applicable to such a plan.

     1.02 General. The benefits provided under the Plan shall be paid, as they become due,
either directly from the Corporation’s general assets or through a grantor trust arrangement
established in accordance with the provisions of Article VIII. The interest of each participant
(and his or her beneficiary) in any benefits that become payable under the Plan shall be no greater
than that of an unsecured creditor of the Corporation.

ARTICLE II

ADMINISTRATION OF THE PLAN

     2.01 Plan Administrator. The Plan shall be administered by a committee of two or more
non-employee Board members who qualify as “outside directors” under Code Section 162(m) and Section
1.162-27(e) of the Treasury Regulations thereunder. The Board committee acting in such capacity
shall hereinafter be referred to as the Plan Administrator and shall have full and complete
authority to administer the Plan and select the Eligible Employees who are to participate in the
Plan.

     2.02 Authority. The interpretation and construction of any provision of the Plan and
the adoption of rules and regulations for plan administration shall be made by the Plan
Administrator. Decisions of the Plan Administrator shall be final and binding on all parties who
have an interest in the Plan, including (without limitation) all decisions relating to an
individual’s eligibility for participation in the Plan, his or her entitlement to benefits
hereunder and the amount of any such benefit entitlement. The Plan Administrator shall also have
the discretionary

 

 

authority to determine whether the involuntary termination of any Participant’s Employee
status constitutes a Termination for Cause (pursuant to the criteria set forth in Section 3.18),
and such determination shall be final and binding on the Participant for purposes of such
Participant’s benefit entitlement (if any) under the Plan.

ARTICLE III

DEFINITIONS

     3.01 “Account” shall mean the account maintained on the Corporation’s books and
records for each Participant who elects to defer any Long-Term Incentive Bonus such Participant
earns under the Plan. The Participant’s Account will be divided into a series of subaccounts, and
there will accordingly be a separate Deferral Subaccount for each Long-Term Incentive Bonus the
Participant elects to defer under the Plan. Each outstanding Account under the Plan shall be
adjusted periodically for investment earnings, gains and losses pursuant to Article VII.

     3.02 “Board” shall mean the Corporation’s Board of Directors.

     3.03 “Change in Control” shall mean a change in ownership or control of the
Corporation effected through any of the following transactions:

     a.  a merger, consolidation or other reorganization approved by the
Corporation’s shareholders in which the persons who beneficially owned (within the
meaning of Rule 13d-3 of the 1934 Act) the Corporation’s outstanding voting
securities immediately prior to such transaction do not immediately thereafter
beneficially own, directly or indirectly and in substantially the same proportion,
securities representing more than fifty percent (50%) of the total combined voting
power of the voting securities of the successor corporation, or

     b.  a shareholder-approved sale, transfer or other disposition of all or
substantially all of the Corporation’s assets, or

     c.  the closing of any transaction or series of related transactions pursuant to
which any person or any group of persons comprising a “group” within the meaning of
Rule 13d-5(b)(1) of the 1934 Act (other than the Corporation or a person that, prior
to such transaction or series of related transactions, directly or indirectly
controls, is controlled by or is under common control with, the Corporation) becomes
directly or indirectly the beneficial owner (within the meaning of Rule 13d-3 of the
1934 Act) of securities possessing (or convertible into or exercisable for
securities possessing) more than fifty percent (50%) of the total combined voting
power of the Corporation’s securities (as measured in terms of the power to vote
with respect to the election of Board

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members) outstanding immediately after the consummation of such transaction or
series of related transactions, whether such transaction involves a direct issuance
from the Corporation or the acquisition of outstanding securities held by one or
more of the Corporation’s existing shareholders.

     3.04 “Code” shall mean the Internal Revenue Code of 1986, as amended from time to
time.

     3.05 “Corporation” shall mean American Shared Hospital Services Corporation and any
successor or assignee corporation, whether by way of merger, acquisition or other reorganization.

     3.06 “Deferral Election” shall mean the irrevocable election filed by the Participant
under Article VI of the Plan pursuant to which all or a portion of his or her Long-Term Incentive
Bonus for a particular Earn-Out Period is to be deferred in accordance with the provisions of the
Plan.

     3.07 “Disability or Disabled” shall mean the Participant’s inability to engage in any
substantial gainful employment by reason of any physical or medical impairment which is expected to
result in death or continue for a period of twelve (12) consecutive months or more.

     3.08 “Earn-Out Period” shall mean the period of one or more consecutive calendar years
established by the Plan Administrator over which the Corporation must attain the Performance
Milestones which the Plan Administrator has designated for that period.

     3.09 “Eligible Employee” shall mean any executive officer or any other individual with
management responsibilities who is determined by the Plan Administrator to be a highly compensated
Employee in accordance with the guidelines established from time to time by the Plan Administrator.

     3.10 “Employee” shall mean any person in the employ of the Corporation, subject to
its control and direction as to both the work to be performed and the manner and method of
performance.

     3.11 “Involuntary Termination” shall mean the termination of Employee status by
reason of:

     (i) the Employee’s discharge or dismissal by the Corporation for any reason other than a
Termination for Cause, or

     (ii) the Employee’s death or Disability.

     3.12 “Long-Term Incentive Bonus” shall mean the bonus to which the Participant may
become entitled with respect to a particular Earn-Out Period on the basis of the Corporation’s
attainment of the specific Performance Milestones the Plan Administrator has established for that
Earn-Out Period.

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     3.13 1934 Act shall mean the Securities Exchange of 1934, as amended.

     3.14 Maximum Bonus Amount shall mean the maximum dollar amount of the Long-Term
Incentive Bonus which a Participant may earn for any one Earn-Out Period. Such Maximum Bonus Amount
shall be determined by the Plan Administrator within the first ninety (90) days of the Earn-Out
Period, but in no event shall such amount exceed the dollar amount determined by multiplying the
number of calendar years comprising the Earn-Out Period by Two Hundred Fifty Thousand Dollars
($250,000). For any pro-rated Long-Term Incentive Bonus which becomes payable under the Plan, the
Pro-Rated Maximum Bonus Amount shall be determined by multiplying the Maximum Bonus Amount
for the Earn-Out Period to which that bonus relates by a fraction, the numerator of which is the
number of days the Participant continued in Employee status during that Earn-Out Period and the
denominator of which is the total number of days in the calendar years comprising such Earn-Out
Period.

     3.15 “Participant” shall mean each Eligible Employee who participates in the Plan.

     3.16 “Performance Milestones” shall mean one or more of the following performance
goals as to which the Plan Administrator may designate specific objectives to be attained by the
Corporation for a particular Earn-Out Period: (1) return on total shareholder equity; (2) earnings
per share of Common Stock; (3) net income or operating income (before or after taxes); (4) earnings
before interest, taxes, depreciation and amortization; (5) earnings before interest, taxes,
depreciation, amortization and charges for stock-based compensation, (6) sales or revenue targets;
(7) return on assets, capital or investment; (8) cash flow; (9) market share; (10) cost reduction
goals; (11) budget comparisons; (12) measures of customer satisfaction; (13) any combination of, or
a specified increase in, any of the foregoing; (14) the formation of joint ventures or the
completion of other corporate transactions intended to enhance the Corporation’s revenue or
profitability or enhance its customer base. In addition, such performance goals may be based upon
the attainment of specified levels of the Corporation’s performance under one or more of the
measures described above relative to the performance of other entities and may also be based on the
performance of any of the Corporation’s business units or divisions or any Parent or Subsidiary.

     3.17 “Retirement” shall mean the Participant’s termination of Employee status (other
than a Termination for Cause) on or after (i) his or her attainment of age sixty five (65) or (ii)
his or her attainment of age fifty-five (55) and completion of at least fifteen (15) years of
Employee status.

     3.18 “Termination for Cause" shall mean the Corporation’s termination of the
Participant’s status as an Employee for one or more of the following reasons: (i) the
Participant’s failure to correct deficiencies in his or her level of performance within a
reasonable period of time following the identification of those deficiencies by the Board (in the
case of the Chief Executive Officer) or by the Corporation’s Chief Executive Officer (in the case
of any other Participant), (ii) the Participant’s habitual neglect of his or her duties or his or
her repeated absenteeism, excessive tardiness or continued failure to follow established rules and
procedures for the Corporation’s employees, (iii) the Participant’s commission of any act of fraud
or

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embezzlement, (iv) any unauthorized use or disclosure by the Participant of material
confidential information or trade secrets of the Corporation, (v) a material breach by the
Participant of any of his or her fiduciary obligations as an officer of the Corporation or (vi) the
Participant’s intentional and knowing participation in the preparation or release of false or
materially misleading financial statements relating to the Corporation’s operations and financial
condition or his or her intentional and knowing submission of any false or erroneous certification
required of the Participant under the Sarbanes-Oxley Act of 2002 or any securities exchange on
which shares of the Common Stock are at the time listed for trading or (vii) any other intentional
misconduct by the Participant adversely affecting the business or affairs of the Corporation in a
material manner. The foregoing definition shall not in any way preclude or restrict the right of
the Corporation to discharge or dismiss any Participant or other Employee for any other acts or
omissions, but such other acts or omissions shall not be deemed, for purposes of the Plan, to
constitute grounds for Termination for Cause.

     3.19 “Valuation Date” shall mean any date as of which the balance credited to each of
the Participant’s Deferral Subaccounts is to be determined. If the date in question is coincident
with a date on which the U.S. financial markets are open for business, then the Valuation Date
shall be that same date; otherwise, the Valuation Date shall be first date immediately preceding
the date in question on which the U.S. financial markets are open for business.

ARTICLE IV

PARTICIPATION

     4.01 Eligibility Rules. The Plan Administrator shall have absolute discretion in
selecting the Eligible Employees who are to participate in each Earn-Out Period implemented under
the Plan. The Participants for each Earn-Out Period shall be selected not later than the
ninetieth (90th) day after the start date of that Earn-Out Period.

     4.02 Cessation of Participation. The Plan Administrator shall have complete discretion
to exclude one or more individuals from Participant status for one or more subsequent Earn-Out
Periods implemented under the Plan. If any individual is excluded from Participant status for one
or more Earn-Out Periods, then such individual shall not be entitled to any Long-Term Incentive
Bonus for those Earn-Out Periods. However, such individual shall continue to have the right, during
his or her period of continued Employee status, to direct the hypothetical investment of any
Deferral Subaccounts maintained on his or her behalf pursuant to the provisions of Article VI.

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ARTICLE V

LONG-TERM INCENTIVE BONUSES

     5.01 Establishment of Earn-Out Period and Bonus Potential. The Plan Administrator
shall have complete discretion to implement one or more Earn-Out Periods under the Plan in
accordance with the following parameters:

     (i) Each Earn-Out Period shall be coincidental with a period of not less than
one (1) or more than five (5) consecutive calendar years. The Plan Administrator
shall, within the first ninety (90) days of the Earn-Out Period, designate the
actual number of calendar years which shall comprise that Earn-Out Period.

     (ii) The Plan Administrator shall, within the first ninety (90) days of each
Earn-Out Period, establish the specific performance goals and objectives which must
be attained for that Earn-Out Period based on one or more of the Performance
Milestones. For each specific performance objective, the Plan Administrator shall
establish threshold, target and maximum levels of attainment. With respect to any
performance objective which is to be calculated in a manner which deviates from
generally acceptable accounting standards, the Plan Administrator shall specify the
deviations at the time the performance objective is set.

     (iii) The Plan Administrator shall also, within the first ninety (90) days of
the Earn-Out Period, establish for each Participant the formula for calculating the
Long-Term Incentive Bonus to which he or she may become entitled for that Earn-Out
Period based on the level at which each Performance Milestone is actually attained.
Accordingly, for each Performance Milestone, the formula shall designate a
threshold, target and above-target dollar contribution to the Participant’s
Long-Term Incentive Bonus, with the actual dollar amount of such contribution to be
based on the actual level of attainment of each performance objective. The various
levels of contribution designated for each performance objective may be tied to
percentages or multiples of the average of the annual rates of base salary in
effect for the Participant at the start of each calendar year within the applicable
Earn-Out Period.

     5.02 Service Requirement. A Participant shall not become entitled to a Long-Term
Incentive Bonus for a particular Earn-Out Period unless the Participant continues in Service
through the completion of that Earn-Out Period or the Participant ceases Service in that Earn-Out
Period by reason of Retirement or Involuntary Termination (other than Termination for Cause);
provided, however, that a Participant whose Employee status terminates by reason of Retirement or
Involuntary Termination prior to the completion of the Earn-Out Period shall only be entitled to a
pro-rated Long Term Incentive Bonus for that period determined in accordance

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with Section 5.06. Should the Participant cease Service for any other reason prior the
completion of the Earn-Out Period, then he or she shall not be entitled to any Long-Term Incentive
Bonus for that Earn-Out Period.

     5.03 Determination of Individual Bonus Amount. The following provisions shall govern
the determination of the Long-Term Incentive Bonus for each Participant who continues Employee
status through the completion of the Earn-Out Period or is otherwise entitled to a pro-rated bonus
for such Earn-Out Period pursuant to the provisions of Section 5.02:

     (i) As soon as administratively practicable following the completion of the
Earn-Out Period, the Plan Administrator shall, on the basis of the Corporation’s
audited financial statements for the fiscal years included within that Earn-Out
Period, determine the actual level of attainment for each performance objective
designated for that Earn-Out Period and shall then measure that level of attainment
against the threshold level, the target level and the above-target level of
attainment established for that performance objective.

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     (ii) In making such determination and measurement, the Plan Administrator shall
exclude the following items, as calculated and determined in accordance with
generally accepted accounting principles, but only to the extent those items were
designated as potential adjustments to the performance objectives at the time those
objective were established for the Earn-Out Period: all extraordinary, unusual or
non-recurring items of gain, loss or expense; all items of gain, loss or expense
related to (a) the disposal of a business or discontinued operations or (b) the
operations of any business acquired by Corporation during the Earn-Out Period; all
accruals for reorganization and restructuring cost and expenses; and all items of
gain, loss or expense attributable to changes in tax laws and regulations,
accounting principles or other applicable laws or regulations.

     (iii) The Plan Administrator shall certify in writing the actual level of
attainment of each such performance objective, as adjusted for the items specified
in subparagraph (ii) above. Based on such certification and measurement, the Plan
Administrator shall then determine the Long-Term Incentive Bonus for each
Participant by aggregating the dollar amounts earned for each Performance Milestone
based on the actual level of attainment of that particular milestone. To the extent
the actual level of attainment for any Performance Milestone is at a point between
two of the levels established by the Plan Administrator, the dollar amount of the
portion of each Long-Term Incentive Bonus tied to that Performance Milestone shall
be pro-rated between the two points on a straight-line basis. The Long-Term
Incentive Bonus so calculated shall be subject to the pro-ration provisions of
Section 5.05 for certain Participants who ceased Service prior to the completion of
that Performance Period. In no event, however, shall any Long-Term Incentive Bonus
be earned with respect to a particular Performance Milestone if the actual level of
attainment of that Performance Milestone is below the threshold level set for that
milestone. By way of illustration, if the actual level of attainment for one of two
performance objectives is at the threshold level established by the Plan
Administrator and the actual level of attainment for the second performance
objective is at the target level, then the Long-Term Incentive Bonus will be at the
threshold dollar level set for the first performance objective and at the target
dollar level set for the other objective.

     (iii) The Plan Administrator shall have complete and absolute discretion to
reduce the Long-Term Incentive Bonus determined for one or more Participants in
accordance with the foregoing provisions of this Section 5.03; provided, however,
that no such reduction shall result in an increase to the Long-Term Incentive Bonus
of any other Participant or Participants. In no event shall the Long-Term Incentive
Bonus for any Participant exceed the Maximum Bonus Amount for the Earn-Out Period
or, for a Participant entitled to only a pro-rated Long-Term Incentive Bonus under
Section 5.05, the Pro-Rated Maximum Bonus Amount.

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     5.04 Pro-Rated Award. A Participant whose Employee status terminates prior to the
completion of the Earn-Out Period by reason of Retirement or Involuntary Termination shall be
entitled to a pro-rated Long-Term Incentive Bonus in a dollar amount determined by multiplying (i)
the actual Long-Term Incentive Bonus to which he or she would have been entitled under Section 5.03
had he or she continued in Employee status through the last day of the applicable Earn-Out Period
by (ii) fraction, the numerator of which is the number of days such Participant remained in
Employee status during the Earn-Out Period and the denominator of which is the total number of days
in that Earn-Out Period. The Participant’s pro-rated Long-Term Incentive Bonus for the Earn-Out
Period shall be the lesser of (i) the dollar amount so calculated or (ii) the Pro-Rated Maximum
Bonus Amount for that Earn-Out Period.

     5.05 Change in Control Pro-Ration. Should a Change in Control transaction be
consummated more than six (6) months after the start of the Earn-Out Period but before the date
that period was originally scheduled to be completed, then the Earn-Out Period shall terminate upon
the consummation of the Change in Control, and the following procedures shall govern the
calculation of the pro-rated Long-Term Incentive Bonuses to become payable in connection therewith:

     First, the dollar amount of each Participant’s Long-Term Incentive Bonus shall
be calculated by assuming that each performance objective established for the
Earn-Out Period will be attained at the target level.

     Then, the Long-Term Incentive Bonus so calculated shall, for each Participant
who continued in Employee status through the date of such Change in Control, be
multiplied by a fraction, the numerator of which is the number of days such
Participant remained in Employee status during the portion of the Earn-Out Period
ending with the Change in Control and the denominator of which is the total number
of days for which that Earn-Out Period was originally scheduled to last. The
Participant’s pro-rated Long-Term Incentive Bonus for the Earn-Out Period shall be
the lesser of (i) the dollar amount so calculated or (ii) the Pro-Rated Maximum
Bonus Amount calculated for that Earn-Out Period on the basis of the total number of
days for which that Earn-Out Period was originally scheduled to last.

     Finally, the Long-Term Incentive Bonus of each Participant whose Employee
status was terminated by reason of Retirement or Involuntary Termination during the
Earn-Out Period in which such Change in Control occurred shall be calculated by
multiplying the Long-Term Incentive Bonus calculated for him or her under the first
step above by a fraction, the numerator of which is the number of days such
Participant completed in Employee status during that Earn-Out Period and the
denominator of which is the total number of days for which that Earn-Out Period was
originally scheduled to last. The Participant’s pro-rated Long-Term Incentive Bonus
for the Earn-Out Period shall

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be the lesser of (i) the dollar amount so calculated or (ii) the Pro-Rated Maximum
Bonus Amount calculated for that Earn-Out Period on the basis of the total number of
days for which that Earn-Out Period was originally scheduled to last.

     No Long-Term Incentive Bonuses shall be earned or otherwise become payable with respect to
any Earn-Out Period in which a Change in Control is consummated, if such consummation occurs
within the first six (6) months of that Earn-Out Period.

ARTICLE VI

PAYMENT OR DEFERRAL OF LONG-TERM INCENTIVE BONUSES

     6.01 Payment. The following provisions shall govern the payment of each Long-Term
Incentive Bonus to which a Participant becomes entitled under the Plan:

     A. Except to the extent the Participant has filed a timely Deferral Election, the Long-Term
Incentive Bonus to which the Participant becomes entitled for a particular Earn-Out Period shall be
paid to him or her in a lump sum on March 15 of the calendar year following the calendar year in
which that Earn-Out Period ends or (to the extent applicable) on the thirtieth (30th) day following
the consummation of the Change in Control, unless in either instance it is not administratively
practical to complete the requisite calculations under Article V prior to such date. In such event
payment shall be deferred but shall be made no later than December 31 of the calendar year
following the calendar year in which the Earn-Out Period ends or (with respect to an Earn-Out
Period ending with the Change in Control) the later of (i) the end of the calendar year in which
such Change in Control is consummated or (ii) the fifteenth (15th) day of the third calendar month
following the consummation of the Change in Control.

     B. A Participant may make a Deferral Election with respect to all or part of any Long-Term
Incentive Bonus to which he or she may become entitled under the Plan. However, only one Deferral
Election may be made per Long-Term Incentive Bonus. The Deferral Election must be made by filing an
appropriate election form with the Plan Administrator or its designate in accordance with the
following requirements:

     (i) An individual who is selected as a Participant for an Earn-Out Period on or
before date the performance objectives for that Earn-Out Period are established by
the Plan Administrator may file the Deferral Election with respect to all or part of
any Long-Term Incentive Bonus earned for that period at any time while such
individual remains in Employee status up until the final six (6) months of that
Earn-Out Period. The Deferral Election must specify a payment date or payment event
for the deferred portion in accordance with the events listed below or may specify
that payment is to occur upon the earliest or the latest of any of those events:

     - a specified date which is at least twelve (12) months later than the last day
of the applicable Earn-Out Period,

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     - the Participant’s separation from service (as determined in accordance with
the criteria established under Code Section 409A and the applicable Treasury
Regulations thereunder) at any time following the conclusion of the applicable
Earn-Out Period, or

     - the closing of a Change in Control at any time following the conclusion of
the applicable Earn-Out Period.

     (ii) A Participant who does not otherwise qualify for a Deferral Election under
subparagraph (i) above may file a Deferral Election with respect to all or part of
any Long-Term Incentive Bonus, provided such election is filed at least twelve (12)
months prior to the last day of the Earn-Out Period to which that Long-Term
Incentive Bonus relates. In no event, however, shall such election become effective
or otherwise have any force or applicability until the expiration of the twelve
(12)-month period measured from the date such election is filed with the Plan
Administrator or its designate, and such election shall accordingly become null and
void should a Change in Control be consummated within that twelve (12)-month period.
The Deferral Election must specify a payment date for the deferred portion which is
at least five (5) years later than the March 15 date on which the Long-Term
Incentive Bonus would have otherwise become payable in the absence of such Deferral
Election or any Change in Control.

     6.02 Deferral Account. If a Participant makes a timely Deferral Election under
Section 6.01 with respect to all or part of his or her Long-Term Incentive Bonus, then a Deferral
Subaccount shall be established for the Participant and credited with the dollar amount of the
portion of the Long-Term Incentive Bonus subject to that Deferral Election, as and when that bonus
would have otherwise become due and payable to the Participant in the absence of such Deferral
Election. The Participant shall at all times be fully vested in the balance credited to each of
his or her Deferral Subaccounts, as adjusted periodically for investment earnings, gains and losses
pursuant to Article VII. Distribution of each Deferral Subaccount shall be made or commence on the
payment date or payment event specified in the Deferral Election made with respect to the Long-Term
Incentive Bonus credited to that subaccount or as soon as administratively practicable thereafter,
but in no event later than December 31 of the calendar year in which that payment date or event
occurs or (if later) the fifteenth (15th) day of the third calendar month following such specified
payment date or event. The distribution shall be made in a lump sum payment, unless the
Participant designates an installment distribution over a period not to exceed five (5) years in
his or her Deferral Election with respect to that Deferral Subaccount.

     6.03 Distribution Upon Death or Disability. The following provisions shall govern the
distribution of benefits under the Plan in the event the Participant with one or more Deferred
Subaccounts under the Plan should die while in Employee status or at any time

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thereafter, or become Disabled following cessation of Employee status, while there is an
outstanding balance credited to those subaccounts and shall supersede any provision to the contrary
in Section 6.02.

     A. The undistributed portion shall be paid in a lump sum to the Participant or (in the event
of the Participant’s death) to his or her designated beneficiary(ies) under the Plan. Such payment
shall be made as soon as administratively practical following the Participant’s death or
Disability, but in no event later than December 31 of the calendar year in which Participant dies
or becomes Disable or (if later) the fifteenth (15th) day of the third calendar month following the
date of his or her death or Disability.

     B. The Participant may designate one or more such beneficiaries, or may revoke his or her
existing beneficiary designation and make a new designation, by filing a properly completed
beneficiary designation in accordance with the procedures established by the Plan Administrator or
its designate. Should the Participant die without a valid beneficiary designation in effect or
after the death of his or her designated beneficiary(ies), then any amounts due him or her under
the Plan shall be paid to the personal representative of his or her estate.

     6.04 Valuation. The amount to be distributed from any Deferral Subaccount pursuant
to this Article VI shall be determined on the basis of the balance credited to that subaccount as
of the most recent practicable Valuation Date (as determined by the Plan Administrator or its
designate) preceding the date of the actual distribution.

     6.05 Installment Distribution. To the extent the Participant elects an installment
distribution in his or her Deferral Election with respect to a particular Deferral Subaccount, that
subaccount shall be paid in a series of annual installments over the designated period. The amount
of each annual installment shall be determined by dividing the balance credited to that subaccount
on the Valuation Date immediately prior to the installment by the number of remaining installments
(including the current installment).

     6.06 Withholding Taxes. The Participant shall be responsible for the satisfaction of
all federal, state and local income, employment and other payroll taxes (including FICA taxes)
which are required to be withheld on his or her Long-Term Incentive Bonus, and such taxes shall
accordingly be paid, as and when they become due under applicable law, through the Corporation’s
withholding of those taxes from the wages and earnings payable to the Participant or by any other
means acceptable to the Corporation.

ARTICLE VII

INVESTMENT RETURN

     7.01 Investment Return. Each of the Participant’s Deferral Subaccounts shall be
adjusted periodically to reflect the earnings, gains and losses equal to the actual investment
experience realized for the period by one or more of the investment funds selected by the

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Participant from the investment alternatives identified in Appendix I. At the time a Long-Term
Incentive Bonus is initially credited to the Participant’s Deferral Subaccount, that bonus shall be
automatically deemed invested in the      Fund and shall continue to be deemed so invested until
the Participant reallocates the balance of that subaccount to one or more other investment funds
pursuant to the provisions of Section 7.02. On each day on which the U.S. financial markets are
open, each of the Participant’s Deferral Subaccounts shall be adjusted to reflect the investment
earnings, gains or losses those subaccounts would have actually realized had they been invested on
that day in the selected investment funds.

     7.02 Reallocation of Account Balances Between Funds. A Participant may elect at any
time to reallocate (in such percentages as the Plan Administrator shall authorize) part or all of
the balance of one or more of his or her Deferral Subaccounts among the available investment
alternatives. Accordingly, a separate reallocation may be made as to each such subaccount. Each
designated reallocation shall be effected as soon as reasonably practicable after the new
allocations are filed by the Participant in accordance with procedures established by the Plan
Administrator or its designate.

     7.03 Account Value. The value of each of the Participant’s Deferral Subaccounts on
any Valuation Date in question shall be equal to the balance credited to that subaccount as of the
close of business on that date, including the appropriate adjustments for (i) any deferred
Long-Term Incentive Bonus or investment gains or earnings credited to such subaccount as of such
date and (ii) any investment losses charged against the subaccount as of such date.

     7.04 Statement of Accounts. Following the close of each calendar quarter, each
Participant shall receive a written statement of the value of his or her Deferral Subaccounts as of
the last Valuation Date in that quarter.

     7.05 No Required Investment. Although the investment return on a Participant’s
Account is to be measured by the actual gains, earnings and losses realized by one or more of the
investment alternatives selected by the Participant pursuant to this Article VII, the Corporation
shall not be under any obligation to make the selected investments, and the investment experience
shall only be tracked as debits or credits to the Participant’s book accounts over the deferral
period. To the extent the Corporation should elect to make any actual investments, the Corporation
shall be the sole and exclusive owner of those investments, and no Participant shall have any
right, title or interest in or to those investments.

ARTICLE VIII

MISCELLANEOUS

     8.01 Plan Effective Date. The Plan shall become effective immediately upon approval
by the Corporation’s shareholders at the 2006 Annual Shareholders Meeting. In the event of such
shareholder approval, the first Earn-Out Period may commence with the 2007 or any subsequent
calendar year.

13

 

     8.02 Deferred Commencement Date. Notwithstanding any provision to the contrary in the
Plan, no distribution which becomes due and payable from the Participant’s Deferral Subaccounts by
reason of his or her termination of Employee status shall be made to that Participant prior to the
earlier of (i) the expiration of the six (6)-month period measured from the date of his or her
“separation from service” (as determined in accordance with the criteria established under Code
Section 409A and the applicable Treasury Regulations thereunder) or (ii) the date of his or her
death, if the Participant is deemed at the time of such separation from service to be a “key
employee” within the meaning of that term under Code Section 416(i) and such delayed commencement
is otherwise required in order to avoid a prohibited distribution under Code Section 409A(a)(2).
Upon the expiration of the applicable Code Section 409A(a)(2) deferral period, all payments
deferred pursuant to this Section 8.02 shall be paid in a lump sum to the Participant, and any
remaining payments shall be made on their scheduled payment dates.

     8.03 Benefits Not Funded. The obligation to pay the vested balance of each
Participant’s Account hereunder shall at all times be an unfunded and unsecured obligation of the
Corporation. Except to the extent the Corporation may in its sole discretion elect to implement a
grantor trust to hold funds for the payment of any benefits which become due and payable hereunder,
the Corporation shall not have any obligation to establish any trust, escrow arrangement or other
fiduciary relationship for the purpose of segregating funds for the payment of the balances
credited to the outstanding Accounts under the Plan, nor shall the Corporation be under any
obligation to invest any portion of its general assets in mutual funds, stocks, bonds, securities
or other similar investments in order to accumulate funds for the satisfaction of its respective
obligations under the Plan. The Participant (or his or her beneficiary) shall look solely and
exclusively first to the general assets of the Corporation for the payment of the Account
maintained on the Participant’s behalf under the Plan. Payments from any grantor trust established
by the Corporation under the Plan shall be made as and when benefits become payable to Participants
in accordance with the distribution provisions of Article VI of the Plan.

     8.04 No Employment Right. Neither the action of the Corporation in establishing or
maintaining the Plan, nor any action taken under the Plan by the Plan Administrator, nor any
provision of the Plan itself shall be construed so as to grant any person the right to remain in
the employ or service of the Corporation for any period of specific duration, and the Participant
shall at all times remain an Employee at will and may accordingly be discharged at any time, with
or without cause and with or without advance notice of such discharge.

     8.05 Amendment/Termination. The Board may at any time amend the provisions of the
Plan to any extent and in any manner the Board shall deem advisable, and such amendment shall
become effective at the time of such Board action, subject to any shareholder approval requirements
under Code Section 162(m) or any other applicable law or regulation or the listing regulations of
any securities exchange (or the Nasdaq National Market) on which the Corporation’s common stock is
at the time traded. Without limiting the generality of the foregoing, the Board may amend the Plan
to impose such restrictions upon the timing, filing and effectiveness of Deferral Elections, the
investment procedures and investment alternatives available under Article VII and the distribution
provisions of Article VI which the Board deems

14

 

appropriate or advisable in order to avoid the current income taxation of amounts deferred
under the Plan which might otherwise occur as a result of changes to the tax laws and regulations
governing deferred compensation arrangements such as the Plan and may also, in such event, cease
further deferrals under the Plan. The Board may also at any time terminate the Plan in whole or in
part. Except for such modifications, limitations or restrictions as may otherwise be required to
avoid current income taxation or other adverse tax consequences to Participants as a result of
changes to the tax laws and regulations applicable to the Plan, no such plan amendment or plan
termination authorized by the Board shall adversely affect the benefits of Participants accrued to
date under the Plan or otherwise reduce the then outstanding balances credited to their Deferral
Subaccounts or otherwise adversely affect the distribution provisions in effect for those
subaccounts, and all amounts deferred prior to the date of any such plan amendment or termination
shall, subject to the foregoing exception, continue to become due and payable in accordance with
the distribution provisions of Article VI as in effect immediately prior to such amendment or
termination.

     8.06 Applicable Law. The deferral provisions of Article VI and VII of the Plan are
intended to constitute an unfunded deferred compensation arrangement for a select group of
management and other highly compensated persons, and all rights thereunder shall be construed,
administered and governed in all respects in accordance with the provisions of the Employee
Retirement Income Security Act of 1974 (as amended from time to time) applicable to such an
arrangement and, to the extent not pre-empted thereby, by the laws of the State of California
without resort to its conflict-of-laws provisions. All other provisions of the Plan shall also be
construed, administered and governed by the laws of the State of California without resort to its
conflict-of-laws provisions. If any provision of this Plan shall be held by a court of competent
jurisdiction to be invalid or unenforceable, the remaining provisions of the Plan shall continue in
full force and effect.

     8.07 Satisfaction of Claims. Any payment made to a Participant or his or her legal
representative or beneficiary in accordance with the terms of this Plan shall to the extent thereof
be in full satisfaction of all claims with respect to that payment which such person may have
against the Plan, the Plan Administrator (or its designate) or the Corporation, any of whom may
require the Participant or his or her legal representative or beneficiary, as a condition precedent
to such payment, to execute a receipt and release in such form as shall be determined by the Plan
Administrator.

     8.08 Alienation of Benefits. No person entitled to benefits under the Plan shall have
any right to transfer, assign, alienate, pledge, hypothecate or otherwise encumber his or her
interest in such benefits prior to actual receipt of those benefits. The benefits payable under the
Plan shall not, prior to actual payment, be subject to seizure or sequestration for the payment of
any debts, judgments, alimony or separate maintenance owed by a Participant or any other person and
shall not, to the maximum extent permitted by law, be transferable by operation of law in the event
of the bankruptcy or insolvency of the Participant or any other person.

     8.09 Successors and Assigns. The obligation of the Corporation to make the payments
required hereunder shall be binding upon the successors and assigns of the Corporation, whether by
merger, consolidation, acquisition or other reorganization. Except for

15

 

such modifications, limitations or restrictions as may otherwise be required to avoid current
income taxation or other adverse tax consequences to Participants as a result of changes to the tax
laws and regulations applicable to the Plan, no amendment or termination of the Plan by any such
successor or assign shall adversely affect or otherwise impair the rights of Participants to
receive benefit payments hereunder, to the extent attributable to amounts accrued or deferred prior
to the date of such amendment or termination, in accordance with the applicable vesting and
distribution provisions of Article VI as in effect immediately prior to such amendment or
termination.

ARTICLE IX

BENEFIT CLAIMS

     9.01 Claims Procedure. No application is required for the payment of benefits under
the Plan. However, if any Participant (or beneficiary) believes he or she is entitled to a benefit
from the Plan which differs from the benefit determined by the Administrative Committee, then such
individual may file a written claim for benefits with the Plan Administrator. Each claim shall be
acted upon and approved or disapproved within ninety (90) days following receipt by the Plan
Administrator.

     9.02 Denial of Benefits. In the event any claim for benefits is denied, in whole or
in part, the Plan Administrator shall notify the claimant in writing of such denial and of his or
her right to a review by the Plan Administrator and shall set forth, in a manner calculated to be
understood by the claimant, specific reasons for such denial, specific references to pertinent
provisions of the Plan on which the denial is based, a description of any additional material or
information necessary to perfect the claim, an explanation of why such material or information is
necessary, and an explanation of the review procedure.

     9.03 Review.

     A. Any person whose claim for benefits is denied in whole or in part may appeal to the Plan
Administrator for a full and fair review of the decision by submitting to the Plan Administrator,
within ninety (90) days after receiving written notice from the Plan Administrator of such denial,
a written statement:

     (i) requesting a review by the Plan Administrator of his or her claim for
benefits;

     (ii) setting forth all of the grounds upon which the request for review is
based and any facts in support thereof; and

     (iii) setting forth any issues or comments which the claimant deems pertinent
to his or her claim.

16

 

     B. The Plan Administrator shall act upon each such appeal within sixty (60) days after receipt
of the claimant’s request for review by the Plan Administrator, unless special circumstances
require an extension of time for processing. If such an extension is required, written notice of
the extension shall be furnished to the claimant within the initial sixty (60)-day period, and a
decision shall be rendered as soon as possible, but not later than one hundred twenty (120) days
after receipt of the initial request for review. The Plan Administrator shall make a full and fair
review of each such appeal and any written materials submitted by the claimant or the Participating
Employer in connection therewith and may require the Participating Employer or the claimant to
submit such additional facts, documents or other evidence as the Plan Administrator may, in its
sole discretion, deem necessary or advisable in making such a review. On the basis of its review,
the Plan Administrator shall make an independent determination of the claimant’s eligibility for
benefits under the Plan. The decision of the Plan Administrator on any benefit claim shall be
final and conclusive upon all persons.

     C. Should the Plan Administrator deny an appeal in whole or in part, the Plan Administrator
shall give written notice of such decision to the claimant, setting forth in a manner calculated to
be understood by the claimant the specific reasons for such denial and specific reference to the
pertinent Plan provisions on which the decision was based. Such notice shall also include a
statement that the claimant has a right to bring a civil action under Section 502(a) of the
Employee Retirement Income Security Act of 1974 (as amended from time to time).

17

 

APPENDIX I

LIST OF INVESTMENT FUND ALTERNATIVES

     The investment fund alternatives for the 2005 Plan Year shall be the same as the investment
funds available for such year for salary deferral contributions made under the American Shared
Hospital Services 401(k) Savings Plan.<PAGE>
                                                                     Exhibit 4.4

                             FORM OF THIRD AMENDMENT
                                       TO
                   THE NATIONAL CITY CREDIT CARD MASTER TRUST
                         POOLING AND SERVICING AGREEMENT

     THIS THIRD AMENDMENT TO THE NATIONAL CITY CREDIT CARD MASTER TRUST POOLING
AND SERVICING AGREEMENT, dated as of [ ], 200[ ] (this "Amendment") is by and
between NATIONAL CITY BANK, a national banking association, as Seller and
Servicer, and THE BANK OF NEW YORK (Delaware), a Delaware banking corporation,
as Trustee.

     WHEREAS the Seller and Servicer and the Trustee have executed that certain
Pooling and Servicing Agreement, dated as of June 1, 1995, as amended and
restated as of July 1, 2000 (as amended and supplemented through the date hereof
and as the same may be further amended, supplemented or otherwise modified and
in effect from time to time, the "Pooling and Servicing Agreement");

     WHEREAS the Seller and Servicer and the Trustee wish to amend the Pooling
and Servicing Agreement as provided herein;

     NOW THEREFORE, in consideration of the promises and the agreements
contained herein, the parties hereto agree to amend the provisions of the
Pooling and Servicing Agreement as follows:

     SECTION 1. Amendment of Section 1.01. Section 1.01 of the Pooling and
Servicing Agreement is hereby amended by adding the following definitions in the
appropriate alphabetical order:

          "Exchange Act" shall mean the Securities Exchange Act of 1934, as
     amended.

          "Regulation AB" shall mean Subpart 229.1100 -- Asset Backed Securities
     (Regulation AB), 17 C.F.R. Sections 229.1100-229.1123, as such may be
     amended from time to time, and subject to such clarification and
     interpretation as have been provided by the Commission in the adopting
     release (Asset-Backed Securities, Securities Act Release No. 33-8518, 70
     Fed. Reg. 1,506, 1,531 (January 7, 2005)) or by the staff of the
     Commission, or as may be provided by the Commission or its staff from time
     to time.

          "Sarbanes Certification" shall have the meaning specified in Section
     14.04(iii).

          "Securities Act" shall mean the Securities Act of 1933, as amended.

<PAGE>

          "Securitization Transaction" shall mean any new issuance of Investor
     Certificates, pursuant to Section 6.03, or new notes issued by the National
     City Credit Card Master Note Trust, publicly offered or privately placed,
     rated or unrated.

          "Servicing Criteria" shall mean the "servicing criteria" set forth in
     Item 1122(d) of Regulation AB, as such may be amended from time to time.

     SECTION 2. Amendment of Section 3.05. Section 3.05 of the Pooling and
Servicing Agreement is hereby amended by deleting such Section in its entirety
and inserting in its place the following:

          Section 3.05 Annual Servicer's Certificate. On or before March 15 of
     each calendar year, commencing in 2007, the Servicer will deliver, as
     provided in Section 13.05, to the Trustee, each Rating Agency and each
     Series Enhancer entitled thereto pursuant to the relevant Supplement, the
     statement of compliance required under Item 1123 of Regulation AB with
     respect to the immediately preceding calendar year, which statement will be
     in the form of an Officer's Certificate to the effect that (a) a review of
     the activities of the Servicer during such preceding calendar year and of
     its performance under this Agreement was made under the supervision of the
     officer signing such certificate and (b) to the best of such officer's
     knowledge, based on such review, the Servicer has fulfilled all its
     obligations under this Agreement throughout such preceding calendar year
     or, if there has been a failure to fulfill any such obligation in any
     material respect, specifying each such failure known to such officer and
     the nature and status thereof. A copy of such certificate may be obtained
     by any Investor Certificateholder or Certificate Owner by a request to the
     Trustee addressed to the Corporate Trust Office.

     SECTION 3. Amendment of Section 3.06. Section 3.06 of the Pooling and
Servicing Agreement is hereby amended by deleting such Section in its entirety
and inserting in its place the following:

     Section 3.06 Annual Independent Accountants' Servicing Report. On or before
     March 15 of each calendar year, commencing in 2007, the Servicer, on behalf
     of the Trust, shall cause a firm of nationally recognized independent
     certified public accountants (who may also render other services to the
     Servicer or the Seller) to furnish, as provided in Section 13.05, to the
     Trustee, any Series Enhancer and each Rating Agency each attestation report
     on assessments of compliance with the Servicing Criteria with respect to
     the Servicer or any affiliate thereof during the immediately preceding
     calendar year delivered by such accountants pursuant to Rule 13(a)-18 or
     Rule 15(d)-18 of the Exchange Act and Item 1122 of Regulation AB. A copy of
     such report (or reports, as applicable) may be obtained by any Investor
     Certificateholder or Certificate Owner by a request to the Trustee
     addressed to the Corporate Trust Office.

     SECTION 4. Amendment of Section 6.03. Section 6.03(b) of the Pooling and
Servicing Agreement is hereby amended by the insertion of the following sentence
before the penultimate sentence of such Section:

                                       2
<PAGE>

          In addition, the Seller agrees to provide notice of new issuances of
     Series of Investor Certificates as may be required by and in accordance
     with Item 1121(a)(14) of Regulation AB.

     SECTION 5. Amendment of Section 11.10. Section 11.10(a) of the Pooling and
Servicing Agreement is hereby amended by deleting the first sentence thereof in
its entirety and inserting in its place the following:

          Notwithstanding any other provisions of this Agreement, at any time,
     for the purpose of meeting any legal requirements of any jurisdiction in
     which any part of the Trust may at the time be located, the Trustee shall
     have the power and may execute and deliver all instruments, subject to the
     prior written consent of the Seller, to appoint one or more Persons to act
     as a co-trustee or co-trustees, or separate trustee or separate trustees,
     of all or any part of the Trust, and to vest in such Person or Persons, in
     such capacity and for the benefit of the Certificateholders, such title to
     the Trust, or any part thereof, and, subject to the other provisions of
     this Section 11.10, such powers, duties, obligations, rights and trusts as
     the Trustee may consider necessary or desirable; provided, however, that
     the Trustee shall exercise due care in the appointment of any co-trustee.

     SECTION 6. Addition of Article XIV. The Pooling and Servicing Agreement is
hereby amended by adding the following new Article XIV after Article XIII of the
Pooling and Servicing Agreement:

                                   ARTICLE XIV
                          COMPLIANCE WITH REGULATION AB

          Section 14.01. Intent of the Parties; Reasonableness. The Seller, the
     Trustee and the Servicer acknowledge and agree that the purpose of this
     Article XIV is to facilitate compliance by the Seller with the provisions
     of Regulation AB and related rules and regulations of the Commission. The
     Seller shall not exercise its right to request delivery of information or
     other performance under these provisions other than in good faith, or for
     purposes other than the Seller's compliance with the Securities Act, the
     Exchange Act and the rules and regulations of the Commission thereunder (or
     the provision in a private offering of disclosure comparable to that
     required under the Securities Act). The Trustee agrees to cooperate in good
     faith with any reasonable request by the Seller for information regarding
     the Trustee which is required in order to enable the Seller to comply with
     the provisions of Items 1103(a)(1), 1109(a), 1109(b), 1117, 1118, 1119 and
     1122 of Regulation AB as it relates to the Trustee or to the Trustee's
     obligations under this Agreement or any Supplement. The Servicer shall
     cooperate fully with the Seller to deliver to the Seller (including any of
     its assignees or designees), any and all statements, reports,
     certifications, records and any other information necessary in the good
     faith determination of the Seller to permit the Seller to comply with the
     provisions of Regulation AB, together with such disclosures relating to the
     Servicer and the Accounts, or the servicing of the Receivables, reasonably
     believed by the Seller to be necessary in order to effect such compliance.

                                       3
<PAGE>

          Section 14.02. Additional Representations and Warranties of the
     Trustee. The Trustee shall be deemed to represent to the Seller, as of the
     date on which information is provided to the Seller under Section 14.03
     that, except as disclosed in writing to the Seller prior to such date: (i)
     neither the execution or the delivery by the Trustee of this Agreement or
     any Supplement, the performance by the Trustee of its obligations under
     this Agreement or any Supplement nor the consummation of any of the
     transactions by the Trustee contemplated thereby, is in violation of any
     indenture, mortgage, bank credit agreement, note or bond purchase
     agreement, long-term lease, license or other agreement or instrument to
     which the Trustee is a party or by which it is bound, which violation would
     have a material adverse effect on the Trustee's ability to perform its
     obligations under this Agreement or any Supplement, or of any judgment or
     order applicable to the Trustee; and (ii) there are no proceedings pending
     or threatened against the Trustee in any court or before any governmental
     authority, agency or arbitration board or tribunal which, individually or
     in the aggregate, would have a material adverse effect on the right, power
     and authority of the Trustee to enter into this Agreement or any Supplement
     or to perform its obligations under this Agreement or any Supplement.

          Section 14.03. Information to Be Provided by the Trustee. The Trustee
     shall (i) on or before the [[___] Business Day of each month], provide to
     the Seller, in writing, such information regarding the Trustee as is
     requested for the purpose of compliance with Item 1117 of Regulation AB,
     and (ii) as promptly as practicable following notice to or discovery by the
     Trustee of any changes to such information, provide to the Seller, in
     writing, such updated information.

          The Trustee shall (i) on or before the [___] Business Day of each
     [_______], provide to the Seller such information regarding the Trustee as
     is requested for the purpose of compliance with Items 1103(a)(1), 1109(a),
     1109(b), 1118 and 1119 of Regulation AB, and (ii) as promptly as
     practicable following notice to or discovery by the Trustee of any changes
     to such information, provide to the Seller, in writing, such updated
     information. Such information shall include, at a minimum:

               (A) the Trustee's name and form of organization;

               (B) a description of the extent to which the Trustee has had
          prior experience serving as a trustee for asset-backed securities
          transactions involving credit card receivables;

               (C) a description of any affiliation or relationship between the
          Trustee and any of the following parties to a Securitization
          Transaction, as such parties are identified to the Trustee by the
          Seller in writing in advance of such Securitization Transaction:

                    (1) the sponsor;

                                       4
<PAGE>

                    (2) any depositor;

                    (3) the issuing entity;

                    (4) any servicer;

                    (5) any trustee;

                    (6) any originator;

                    (7) any significant obligor;

                    (8) any enhancement or support provider; and

                    (9) any other material transaction party.

               (D) In connection with the above-listed parties, a description of
          whether there is, and if so the general character of, any business
          relationship, agreement, arrangement, transaction or understanding
          that is entered into outside the ordinary course of business or is on
          terms other than would be obtained in an arm's length transaction with
          an unrelated third party, apart from the asset-backed securities
          transaction, that currently exists or that existed during the past two
          years and that is material to an investor's understanding of the
          asset-backed securities.

          Section 14.04. Report on Assessment of Compliance and Attestation. On
     or before March [1] of each calendar year, commencing in 2007, the Trustee
     shall:

               (i) deliver to the Seller a report regarding the Trustee's
          assessment of compliance with the Servicing Criteria during the
          immediately preceding calendar year, as required under Rules 13a-18
          and 15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such
          report shall be addressed to the Seller and signed by an authorized
          officer of the Trustee, and shall address each of the Servicing
          Criteria specified in Exhibit J hereto or such criteria as mutually
          agreed upon by the Seller and the Trustee;

               (ii) deliver to the Seller a report of a registered public
          accounting firm reasonably acceptable to the Seller that attests to,
          and reports on, the assessment of compliance made by the Trustee and
          delivered pursuant to the preceding paragraph. Such attestation shall
          be in accordance with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X
          under the Securities Act and the Exchange Act; and

               (iii) deliver to the Seller and any other Person that will be
          responsible for signing the certification (a "Sarbanes Certification")
          required by Rules 13a-14(d) and 15d-14(d) under the Exchange Act
          (pursuant to Section 302 of the Sarbanes-Oxley Act of 2002) on behalf
          of the Trust, National City Credit Card Master Note Trust or the
          Seller with respect to a Securitization Transaction a certification
          substantially in the form attached hereto as Exhibit I or such form as
          mutually agreed upon by the Seller and the Trustee.

     The Trustee acknowledges that the parties identified in clause (iii) above
     may rely on the certification provided by the Trustee pursuant to such
     clause in signing a Sarbanes Certification and filing such with the
     Commission.

                                       5
<PAGE>

     SECTION 7. Addition of Exhibits I and J to Pooling and Servicing Agreement.
The Pooling and Servicing Agreement is hereby amended by adding new Exhibits I
and J, in their respective forms attached hereto, after Exhibit H to the Pooling
and Servicing Agreement.

     SECTION 8. Effectiveness. The amendments provided for by this Amendment
shall become effective upon receipt by the Trustee of the following:

          (a) Notification in writing from each Rating Agency to the effect that
     the terms of this Amendment will not result in a reduction or withdrawal of
     the rating of any outstanding Series or Class of Investor Certificates to
     which it is a Rating Agency.

          (b) An Officer's Certificate from the Seller delivered to the Trustee
     to the effect that the Seller reasonably believes the terms of this
     Amendment will not adversely affect in any material respect the interests
     of any Investor Certificateholder.

          (c) Counterparts of this Amendment, duly executed by the parties
     hereto.

     SECTION 9. Pooling and Servicing Agreement in Full Force and Effect as
Amended. Except as specifically amended or waived hereby, all of the terms and
conditions of the Pooling and Servicing Agreement shall remain in full force and
effect. All references to the Pooling and Servicing Agreement in any other
document or instrument shall be deemed to mean such Pooling and Servicing
Agreement as amended by this Amendment. This Amendment shall not constitute a
novation of the Pooling and Servicing Agreement, but shall constitute an
amendment thereof. The parties hereto agree to be bound by the terms and
obligations of the Pooling and Servicing Agreement, as amended by this
Amendment, as though the terms and obligations of the Pooling and Servicing
Agreement were set forth herein.

     SECTION 10. Counterparts. This Amendment may be executed in any number of
counterparts and by separate parties hereto on separate counterparts, each of
which when executed shall be deemed an original, but all such counterparts taken
together shall constitute one and the same instrument.

     SECTION 11. Governing Law; Submission to Jurisdiction; Agent for Service of
Process. This Amendment shall be governed by and construed in accordance with
the laws of the State of Delaware, without regard to principles of conflict of
laws. The parties hereto declare that it is their intention that this Amendment
shall be regarded as made under the laws of the State of Delaware and that the
laws of said State shall be applied in interpreting its provisions in all cases
where legal interpretation shall be required. Each of the parties hereto agrees
(a) that this Amendment involves at least $100,000.00, and (b) that this
Amendment has been entered into by the parties hereto in express reliance upon 6
DEL. C. Section 2708. Each of the parties hereto hereby irrevocably and
unconditionally agrees (a) to be subject to the jurisdiction of the courts of
the State of Delaware and of the federal courts sitting in the State of
Delaware, and (b)(1) to the extent such party is not otherwise subject to
service of process in the State of Delaware, to appoint and maintain an agent in
the State of Delaware as such party's agent for acceptance of

                                       6
<PAGE>

legal process, and (2) that, to the fullest extent permitted by applicable law,
service of process may also be made on such party by prepaid certified mail with
a proof of mailing receipt validated by the United States Postal Service
constituting evidence of valid service, and that service made pursuant to (b)(1)
or (2) above shall, to the fullest extent permitted by applicable law, have the
same legal force and effect as if served upon such party personally within the
State of Delaware.

     SECTION 12. Defined Terms and Section References. Capitalized terms used
herein and not otherwise defined shall have the meanings assigned to such terms
in the Pooling and Servicing Agreement. All Section or subsection references
herein shall mean Sections or subsections of the Pooling and Servicing
Agreement, except as otherwise provided herein.

                                       7
<PAGE>

                  IN WITNESS WHEREOF, the Seller, the Servicer and the Trustee
have caused this Amendment to be duly executed by their respective officers as
of the day and year first above written.

                                                NATIONAL CITY BANK,
                                                AS SELLER AND SERVICER

                                                By: ___________________________
                                                    Name:
                                                    Title:

                                                THE BANK OF NEW YORK (DELAWARE),
                                                AS TRUSTEE

                                                By: ___________________________
                                                    Name:
                                                    Title:

<PAGE>

                                                                       EXHIBIT I

                          FORM OF ANNUAL CERTIFICATION

     Re:  The pooling and servicing agreement dated as of June 1, 1995, as
          Amended and Restated as of July 1, 2000 (as amended, supplemented or
          otherwise modified from time to time, the "Agreement"), between
          National City Bank, a national banking association, as seller (the
          "Seller") and servicer, and The Bank of New York (Delaware), a
          Delaware banking corporation, as trustee.

     I, ______________________, the _______________________ of [NAME OF COMPANY]
(the "Company"), certify to the Seller and its officers, with the knowledge and
intent that they will rely upon this certification, that:

          (1) I have reviewed the report on assessment of the Company's
     compliance provided in accordance with Rules 13a-18 and 15d-18 under the
     Securities Exchange Act of 1934, as amended (the "Exchange Act") and Item
     1122 of Regulation AB (the "Servicing Assessment"), and the registered
     public accounting firm's attestation report provided in accordance with
     Rules 13a-18 and 15d-18 under the Exchange Act and Section 1122(b) of
     Regulation AB (the "Attestation Report") that were delivered by the Company
     to the Seller pursuant to the Agreement (collectively, the "Company
     Information");

          (2) To the best of my knowledge, the Company Information, taken as a
     whole, does not contain any untrue statement of a material fact or omit to
     state a material fact necessary to make the statements made, in the light
     of the circumstances under which such statements were made, not misleading
     with respect to the period of time covered by the Company Information;

          (3) To the best of my knowledge, all of the Company Information
     required to be provided by the Company under the Agreement has been
     provided to the Seller; and

          (4) To the best of my knowledge, except as disclosed in the Compliance
     Statement, the Servicing Assessment or the Attestation Report, the Company
     has fulfilled its obligations under the Agreement.

                                             Date:  ___________________________

                                             By: ______________________________
                                             Name:
                                             Title:

                                       2
<PAGE>

                                                                       EXHIBIT J

         SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE

         The assessment of compliance to be delivered by the Trustee shall
address, at a minimum, the criteria identified as below as "Applicable Servicing
Criteria":

<TABLE>
<CAPTION>
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                                   SERVICING CRITERIA                                      APPLICABLE SERVICING
                                                                                                 CRITERIA
-----------------------------------------------------------------------------------------------------------------
     REFERENCE                                     CRITERIA
-----------------------------------------------------------------------------------------------------------------
                                       GENERAL SERVICING CONSIDERATIONS
-----------------------------------------------------------------------------------------------------------------
<S>                  <C>                                                                <C>
1122(d)(1)(i)        Policies and procedures are instituted to monitor any
                     performance or other triggers and events of default in
                     accordance with the transaction agreements.
-----------------------------------------------------------------------------------------------------------------
1122(d)(1)(ii)       If any material servicing activities are outsourced to
                     third parties, policies and procedures are instituted to
                     monitor the third party's performance and compliance with
                     such servicing activities.
-----------------------------------------------------------------------------------------------------------------
1122(d)(1)(iii)      Any requirements in the transaction agreements to maintain
                     a back-up servicer for the credit card accounts or accounts
                     are maintained.
-----------------------------------------------------------------------------------------------------------------
1122(d)(1)(iv)       A fidelity bond and errors and omissions policy is in
                     effect on the party participating in the servicing function
                     throughout the reporting period in the amount of coverage
                     required by and otherwise in accordance with the terms of
                     the transaction agreements.
-----------------------------------------------------------------------------------------------------------------
                                      CASH COLLECTION AND ADMINISTRATION
-----------------------------------------------------------------------------------------------------------------
1122(d)(2)(i)        Payments on credit card accounts are deposited into the
                     appropriate custodial bank accounts and related bank
                     clearing accounts no more than two business days following
                     receipt, or such other number of days specified in the
                     transaction agreements.
-----------------------------------------------------------------------------------------------------------------
1122(d)(2)(ii)       Disbursements made via wire transfer on behalf of an obligor or to
                     an investor are made only by authorized personnel.
-----------------------------------------------------------------------------------------------------------------
1122(d)(2)(iii)      Advances of funds or guarantees regarding collections, cash
                     flows or distributions, and any interest or other fees
                     charged for such advances, are made, reviewed and approved
                     as specified in the transaction agreements.
-----------------------------------------------------------------------------------------------------------------
                     The related accounts for the transaction, such as cash
                     reserve accounts or accounts established as a form of
                     overcollateralization, are separately maintained (e.g.,
                     with respect to commingling of cash) as set forth in the
                     transaction
1122(d)(2)(iv)       agreements.
-----------------------------------------------------------------------------------------------------------------
1122(d)(2)(v)        Each custodial account is maintained at a federally insured
                     depository institution as set forth in the transaction
                     agreements. For purposes of this criterion, "federally
                     insured depository institution" with respect to a foreign
                     financial institution means a foreign financial institution
                     that meets the requirements of Rule 13k-1(b)(1) of the
                     Securities Exchange Act.
-----------------------------------------------------------------------------------------------------------------
1122(d)(2)(vi)       Unissued checks are safeguarded so as to prevent unauthorized
                     access.
-----------------------------------------------------------------------------------------------------------------
1122(d)(2)(vii)      Reconciliations are prepared on a monthly basis for all
                     asset-backed securities related bank accounts, including custodial
                     accounts and related bank clearing accounts.  These reconciliations
                     are (A) mathematically accurate; (B) prepared within 30 calendar
                     days after the bank statement cutoff date, or such other number of
                     days specified in the transaction agreements; (C) reviewed and
                     approved by someone other than the person who prepared the
                     reconciliation; and (D) contain explanations for reconciling
                     items.  These reconciling items are resolved within 90 calendar
                     days of their original identification, or such other number of days
                     specified in the transaction agreements.
-----------------------------------------------------------------------------------------------------------------
</TABLE>

                                       3
<PAGE>

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
                                   SERVICING CRITERIA                                      APPLICABLE SERVICING
                                                                                                 CRITERIA
-----------------------------------------------------------------------------------------------------------------
     REFERENCE                                     CRITERIA
-----------------------------------------------------------------------------------------------------------------
                                      INVESTOR REMITTANCES AND REPORTING
-----------------------------------------------------------------------------------------------------------------
<S>                  <C>                                                                <C>
1122(d)(3)(i)        Reports to investors, including those to be filed with the
                     Commission, are maintained in accordance with the transaction
                     agreements and applicable Commission requirements.  Specifically,
                     such reports (A) are prepared in accordance with timeframes and
                     other terms set forth in the transaction agreements; (B) provide
                     information calculated in accordance with the terms specified in
                     the transaction agreements; (C) are filed with the Commission as
                     required by its rules and regulations; and (D) agree with
                     investors' or the trustee's records as to the total unpaid
                     principal balance and number of credit card accounts serviced by
                     the Servicer.
-----------------------------------------------------------------------------------------------------------------
1122(d)(3)(ii)       Amounts due to investors are allocated and remitted in
                     accordance with timeframes, distribution priority and other
                     terms set forth in the transaction agreements.
-----------------------------------------------------------------------------------------------------------------
                     Disbursements made to an investor are posted within two
                     business days to the Servicer's investor records, or such
                     other number of
1122(d)(3)(iii)      days specified in the transaction agreements.
-----------------------------------------------------------------------------------------------------------------
                     Amounts remitted to investors per the investor reports
                     agree with cancelled checks, or other form of payment, or
                     custodial bank
1122(d)(3)(iv)       statements.
-----------------------------------------------------------------------------------------------------------------
                                          POOL ASSET ADMINISTRATION
-----------------------------------------------------------------------------------------------------------------
1122(d)(4)(i)        Collateral or security on credit card accounts is
                     maintained as required by the transaction agreements or
                     related asset pool documents.
-----------------------------------------------------------------------------------------------------------------
                     Account and related documents are safeguarded as required by the
1122(d)(4)(ii)       transaction agreements
-----------------------------------------------------------------------------------------------------------------
1122(d)(4)(iii)      Any additions, removals or substitutions to the asset pool
                     are made, reviewed and approved in accordance with any
                     conditions or requirements in the transaction agreements.
-----------------------------------------------------------------------------------------------------------------
1122(d)(4)(iv)       Payments on credit card accounts, including any payoffs, made in
                     accordance with the related credit card accounts documents are
                     posted to the Servicer's obligor records maintained no more than
                     two business days after receipt, or such other number of days
                     specified in the transaction agreements, and allocated to
                     principal, interest or other items (e.g., escrow) in accordance
                     with the related asset pool documents.
-----------------------------------------------------------------------------------------------------------------
1122(d)(4)(v)        The Servicer's records regarding the accounts and the
                     accounts agree with the Servicer's records with respect to
                     an obligor's unpaid principal balance.
-----------------------------------------------------------------------------------------------------------------
1122(d)(4)(vi)       Changes with respect to the terms or status of an obligor's
                     account (e.g., loan modifications or re-agings) are made,
                     reviewed and approved by authorized personnel in accordance
                     with the transaction agreements and related pool asset
                     documents.
-----------------------------------------------------------------------------------------------------------------
1122(d)(4)(vii)      Loss mitigation or recovery actions (e.g., forbearance
                     plans, modifications and deeds in lieu of foreclosure,
                     foreclosures and repossessions, as applicable) are
                     initiated, conducted and concluded in accordance with the
                     timeframes or other requirements established by the
                     transaction agreements.
-----------------------------------------------------------------------------------------------------------------
1122(d)(4)(viii)     Records documenting collection efforts are maintained during the
                     period a Account is delinquent in accordance with the transaction
                     agreements.  Such records are maintained on at least a monthly
                     basis, or such other period specified in the transaction
                     agreements, and describe the entity's activities in monitoring
                     delinquent Accounts including, for example, phone calls, letters
                     and payment rescheduling plans in cases where delinquency is deemed
                     temporary (e.g., illness or unemployment).
-----------------------------------------------------------------------------------------------------------------
1122(d)(4)(ix)       Adjustments to interest rates or rates of return for
                     Accounts with variable rates are computed based on the
                     related Account documents.
-----------------------------------------------------------------------------------------------------------------
1122(d)(4)(x)        Regarding any funds held in trust for an obligor (such as escrow
                     accounts): (A) such funds are analyzed, in accordance with the
                     obligor's Account documents, on at least an annual basis, or such
                     other period specified in the transaction agreements; (B) interest
                     on such funds is paid, or credited, to obligors in accordance with
                     applicable Account documents and state laws; and (C) such funds are
                     returned to the obligor within 30 calendar days of full repayment
                     of the related Accounts, or such other number of days specified in
                     the transaction agreements.
-----------------------------------------------------------------------------------------------------------------
</TABLE>

                                       4
<PAGE>

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------
                                   SERVICING CRITERIA                                      APPLICABLE SERVICING
                                                                                                 CRITERIA
-----------------------------------------------------------------------------------------------------------------
     REFERENCE                                     CRITERIA
-----------------------------------------------------------------------------------------------------------------
<S>                  <C>                                                                <C>

1122(d)(4)(xi)       Payments made on behalf of an obligor (such as tax or
                     insurance payments) are made on or before the related
                     penalty or expiration dates, as indicated on the
                     appropriate bills or notices for such payments, provided
                     that such support has been received by the servicer at
                     least 30 calendar days prior to these dates, or such other
                     number of days specified in the transaction agreements.
-----------------------------------------------------------------------------------------------------------------
1122(d)(4)(xii)      Any late payment penalties in connection with any payment
                     to be made on behalf of an obligor are paid from the
                     servicer's funds and not charged to the obligor, unless the
                     late payment was due to the obligor's error or omission.
-----------------------------------------------------------------------------------------------------------------
                     Disbursements made on behalf of an obligor are posted
                     within two business days to the obligor's records
                     maintained by the servicer, or such other number of days
                     specified in the transaction
1122(d)(4)(xiii)     agreements.
-----------------------------------------------------------------------------------------------------------------
1122(d)(4)(xiv)       Delinquencies, charge-offs and uncollectible accounts are
                     recognized and recorded in accordance with the transaction
                     agreements.
-----------------------------------------------------------------------------------------------------------------
                     Any external enhancement or other support, identified in
                     Item 1114(a)(1) through (3) or Item 1115 of Regulation AB,
                     is maintained
1122(d)(4)(xv)       as set forth in the transaction agreements.
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------

</TABLE>

                                             [NAME OF TRUSTEE]

                                             Date: ____________________________

                                             By: ______________________________
                                             Name:
                                             Title:

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