Document:

EXHIBIT 10.2

 

EXECUTION COPY

 

 

CSGQ

TRUST,

 

Issuer

 

CITIBANK, N.A.,

 

Note Administrator

 

and

 

U.S. BANK NATIONAL ASSOCIATION  

 

Indenture Trustee

 

SERIES 2002-1 INDENTURE SUPPLEMENT, TERM NOTES

 

Dated as of June 25, 2002

 

 

 

TABLE OF

CONTENTS

 

	

  ARTICLE

  I

  	

  Creation of the

  Series 2002-1 Notes

  
	

  Section 1.01.

  	

   

  	

  Designation

  
	

  ARTICLE

  II

  	

  Definitions

  
	

  Section 2.01.

  	

   

  	

  Definitions

  
	

  ARTICLE III

  	

  Servicing Fee

  
	

  Section 3.01.

  	

   

  	

  Servicing

  Compensation

  
	

  ARTICLE

  IV

  	

  Rights

  of Series 2002-1 Noteholders  and

  Allocation and Application of Collections

  
	

  Section

  4.01.

  	

   

  	

  Collections

  and Allocations

  
	

  Section

  4.02.

  	

   

  	

  Determination

  of Monthly Interest

  
	

  Section

  4.03.

  	

   

  	

  Daily

  Application of Collections

  
	

  Section 4.04.

  	

   

  	

  Required

  Coverage Amount

  
	

  Section

  4.05.

  	

   

  	

  Application

  of Available Finance Charge Collections and Available Principal Collections

  
	

  Section

  4.06.

  	

   

  	

  Defaulted

  Amounts; Investor Charge-Offs

  
	

  Section

  4.07.

  	

   

  	

  [Reserved]

  
	

  Section

  4.08.

  	

   

  	

  Shared

  Principal Collections

  
	

  Section 4.09.

  	

   

  	

  Determination of

  LIBOR

  
	

  ARTICLE

  V

  	

  Delivery

  of Series 2002-1 Notes; Distributions; Reports to Series 2002-1 Noteholders

  
	

  Section

  5.01.

  	

   

  	

  Delivery

  and Payment for the Series 2002-1 Notes

  
	

  Section 5.02.

  	

   

  	

  Distributions

  
	

  Section

  5.03.

  	

   

  	

  Reports

  and Statements to Series 2002-1 Noteholders

  
	

  ARTICLE

  VI

  	

  Series 2002-1

  Redemption Events; Voting

  
	

  Section

  6.01.

  	

   

  	

  Series

  2002-1 Redemption Events

  
	

  ARTICLE VII

  	

  Redemption

  of Series 2002-1 Notes; Final Distributions; Series Termination

  
	

  Section

  7.01.

  	

   

  	

  Clean-up

  Call; Redemption Event Issuance; Redemption upon Auction; Final Distributions

  
	

  Section 7.02.

  	

   

  	

  Series Termination

  
	

  ARTICLE VIII

  	

  Miscellaneous Provisions

  
	

  Section 8.01.

  	

   

  	

  Ratification of

  Indenture

  
	

  Section 8.03.

  	

   

  	

  Governing Law

  
	

  Section

  8.04.

  	

   

  	

  Private

  Placement of Series 2002-1 Notes; Form of Delivery of Series 2002-1 Notes

  
	

  Section 8.05.

  	

   

  	

  Successors and

  Assigns

  
	

  Section

  8.06.

  	

   

  	

  Transfer

  of the Class B Notes and O/C Certificate

  
	

   

  	

   

  	

   

  

 

i

 

	

  EXHIBITS

  	

   

  
	

   

  	

   

  
	

  EXHIBIT A-1FL

  	

  FORM OF CLASS A-1FL NOTE

  
	

   

  	

   

  
	

  EXHIBIT A-1FX

  	

  FORM OF CLASS A-1FX NOTE

  
	

   

  	

   

  
	

  EXHIBIT A-2FL

  	

  FORM OF CLASS A-2FL NOTE

  
	

   

  	

   

  
	

  EXHIBIT A-2FX

  	

  FORM OF CLASS A-2FX NOTE

  
	

   

  	

   

  
	

  EXHIBIT A-3FL

  	

  FORM OF CLASS A-3FL NOTE

  
	

   

  	

   

  
	

  EXHIBIT A-3FX

  	

  FORM OF CLASS A-3FX NOTE

  
	

   

  	

   

  
	

  EXHIBIT A-4FL

  	

  FORM OF CLASS A-4FL NOTE

  
	

   

  	

   

  
	

  EXHIBIT A-4FX

  	

  FORM OF CLASS A-4FX NOTE

  
	

   

  	

   

  
	

  EXHIBIT B

  	

  FORM OF CLASS B NOTE

  
	

   

  	

   

  
	

  EXHIBIT C

  	

  FORM OF O/C CERTIFICATE

  
	

   

  	

   

  
	

  EXHIBIT D

  	

  FORM OF STATEMENT TO NOTEHOLDERS

  

 

ii

 

An extra section break has been inserted above this paragraph. Do not

delete this section break if you plan to add text after the Table of Contents/Authorities.  Deleting this break will cause Table of

Contents/Authorities headers and footers to appear on any pages following the

Table of Contents/Authorities.

 

 

SERIES 2002-1 INDENTURE SUPPLEMENT, dated as of June

25, 2002 (this “Indenture Supplement”), between CSGQ

Trust, a business trust organized and existing under the laws of the State of

Delaware (herein, the “Issuer” or the “Trust”), U.S. Bank

National Association, 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 Indenture referred to below, the “Indenture

Trustee”) under the Indenture, dated as of June 25, 2002 (as

amended from time to time, the “Indenture”) between the Issuer and the

Indenture Trustee (the Indenture, together with this Indenture Supplement, the

“Agreement”)

and Citibank, N.A., a national association, as note administrator (herein,

together with its successors in the trusts hereunder, called the “Note

Administrator”).

 

Pursuant to Section 2.11 of the Indenture, the

Transferor may direct 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 2002-1 Notes

 

Section 1.01.                                  Designation

 

(a)   There is hereby created and designated a

Series of Notes to be issued pursuant to the Agreement to be known as “CSGQ

Trust, Series 2002-1 Notes” or the “Series 2002-1 Notes.”  The Series 2002-1 Notes shall be issued in

the following classes:  Class A-1FL

Series 2002-1 Floating Rate Asset Backed Notes, Class A-1FX Series 2002-1 Fixed

Rate Asset Backed Notes, Class A-2FL Series 2002-1 Floating Rate Asset Backed

Notes, Class A-2FX Series 2002-1 Fixed Rate Asset Backed Notes, Class A-3FL

Series 2002-1 Floating Rate Asset Backed Notes, Class A-3FXSeries 2002-1 Fixed

Rate Asset Backed Notes, Class A-4FL Series 2002-1 Floating Rate Asset Backed

Notes, Class A-4FX Series 2002-1 Fixed Rate Asset Backed Notes and Class B

Series 2002-1 Floating Rate Asset Backed Notes.  The Series 2002-1 Notes shall be due and payable on the Final

Maturity Date.  The O/C Certificate will

also be issued pursuant to the Agreement as part of Series 2002-1 and will be

entitled to receive the amounts specified hereunder.  The Issuer’s Grant to the Indenture Trustee for the benefit of

holders of the Series 2002-1 Notes of its rights, title and interest in, to and

under the Collateral set forth in the Indenture shall also be made for the

benefit of the O/C Holder and shall secure the O/C Holder’s rights to receive

payments as specified herein and the Issuer hereby confirms that such Grant is

also made for the benefit of the O/C Holder and hereby grants to the Indenture

Trustee a security interest in the Collateral for the benefit of the

Noteholders and the O/C Holder.

 

(b)   Series 2002-1 shall be a Principal Sharing

Series.  Series 2002-1 shall not be

subordinated to any other Series.

 

(c)   The O/C Invested Amount shall be deemed a Series

Enhancement under the Agreement.  The

O/C Holder shall be deemed to be a Series Enhancer for purposes of the notice

and applicable consent provisions under the Agreement.

 

 

(d)   Standard & Poor’s and Moody’s shall be

the Rating Agencies for the Series 2002-1 Notes.

 

[END OF ARTICLE I]

 

2

 

ARTICLE II

 

Definitions

 

Section 2.01.          Definitions

 

(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.

 

“Allocable Finance Charge Collections” shall

mean an amount equal to, with respect to any Monthly Period, the product of

(i) the Floating Allocation Percentage for such Monthly Period and

(ii) Collections of Finance Charge Receivables for such Monthly Period.

 

“Allocable Principal Collections” shall mean an

amount equal to, with respect to any Monthly Period (a) during the

Reinvestment Period and the Special Reinvestment Period, the product of

(i) the Floating Allocation Percentage for such Monthly Period and (ii)

Collections of Principal Receivables for such Monthly Period, and

(b) during the Scheduled Amortization Period, a Partial Reinvestment

Period or a Rapid Amortization Period, the product of (i) the Fixed

Allocation Percentage and (ii) Collections of Principal Receivables for

such Monthly Period.

 

“Available Finance Charge Collections” shall

mean with respect to any Monthly Period an amount equal to the sum of (a)

Allocable Finance Charge Collections for such Monthly Period plus

(b) Reallocated Principal Collections for such Monthly Period.

 

“Available Principal Collections” shall mean,

with respect to any Monthly Period, an amount equal to the sum of (a) the

Allocable Principal Collections for such Monthly Period, (b) any Shared

Principal Collections with respect to other Series that are allocated to Series

2002-1 in accordance with Section 8.05 of the Indenture and Section 4.08

hereof and (c) any other amounts which pursuant to Section 4.05 hereof are

to be treated as Available Principal Collections with respect to the related

Distribution Date.

 

“Class A Invested Amount” shall mean the sum of

the Class A-1 Invested Amount, the Class A-2 Invested Amount, the Class A-3

Invested Amount and the Class A-4 Invested Amount.

 

“Class A Investor Charge-Offs” shall mean, with

respect to any Distribution Date, the sum of the aggregate amounts by which

each of the Class A-1 Invested Amount, the Class A-2 Invested Amount, the Class

A-3 Invested Amount and the Class A-4 Invested Amount have been reduced on all

prior Distribution Dates as the result of Investor Charge-Offs pursuant to

Section 4.06 hereof.

 

“Class A Investor Default Amount” shall mean,

with respect to any Monthly Period, the product of (a) the Investor Default

Amount for such Monthly Period and (b) a fraction, the numerator of which is

the Class A Invested Amount and the denominator of which is the Invested Amount

on the day of determination.

 

3

 

“Class A Notes” shall mean the Class A-1 Notes,

the Class A-2 Notes, the Class A-3 Notes and the Class A-4 Notes.

 

“Class A-1FL Additional Interest” shall have

the meaning specified in subsection 4.02(a).

 

“Class A-1FX Additional Interest” shall have

the meaning specified in subsection 4.02(a).

 

“Class A-1FL Cumulative Monthly Interest” shall

mean, with respect to a Distribution Date, an amount equal to Class A-1FL

Monthly Interest for such Distribution Date plus Class A-1FL Monthly Interest

previously due but not distributed to Class A-1FL Noteholders on a prior

Distribution Date, plus the amount of any Class A-1FL

Additional Interest for such Distribution Date, plus the amount of any Class

A-1FL Additional Interest previously due but not distributed to Class A-1FL

Noteholders on a prior Distribution Date.

 

“Class A-1FX Cumulative Monthly Interest” shall

mean, with respect to a Distribution Date, an amount equal to Class A-1FX

Monthly Interest for such Distribution Date plus Class A-1FX Monthly Interest

previously due but not distributed to Class A-1FX Noteholders on a prior

Distribution Date, plus the amount of any Class A-1FX Additional

Interest for such Distribution Date, plus the amount of any Class A-1FX

Additional Interest previously due but not distributed to Class A-1FX

Noteholders on a prior Distribution Date.

 

“Class A-1FL Cumulative Subordinated Interest”

shall mean, with respect to a Distribution Date, an amount equal to interest on

the Class A-1FL Principal Balance due but not otherwise distributed to the

Class A-1FL Noteholders on such Distribution Date or any prior Distribution

Date pursuant to Section 4.05(a)(iii), at a rate per annum equal to the Class

A-1FL Note Interest Rate (on the same day count basis as the Class A-1FL

Monthly Interest) plus interest on any shortfalls with respect to such amounts

at the Class A-1FL Note Interest Rate.

 

“Class A-1FX Cumulative Subordinated Interest”

shall mean, with respect to a Distribution Date, an amount equal to interest on

the Class A-1FX Principal Balance due but not otherwise distributed to the

Class A-1FX Noteholders on such Distribution Date or any prior Distribution

Date pursuant to Section 4.05(a)(iii), at a rate per annum equal to the Class

A-1FX Note Interest Rate (on the same day count basis as the Class A-1FX

Monthly Interest) plus interest on any shortfalls with respect to such amounts

at the Class A-1FX Note Interest Rate.

 

“Class A-1FL Initial Invested Amount” shall

mean $183,744,000.

 

“Class A-1FX Initial Invested Amount” shall

mean $31,758,000.

 

“Class A-1FL Interest Shortfall” shall have the

meaning specified in subsection 4.02(a).

 

“Class A-1FX Interest Shortfall” shall have the

meaning specified in subsection 4.02(a).

 

4

 

“Class A-1 Initial Invested Amount” shall mean

the sum of the Class A-1FL Initial Invested Amount and the Class A-1FX Initial

Invested Amount.

 

“Class A-1FL Invested Amount” shall mean, with

respect to any date an amount equal to the product of (a) the Class A-1

Invested Amount on such date and (b) a fraction the numerator of which is the

Class A-1FL Initial Invested Amount and the denominator of which is the sum of

the Class A-1FL Initial Invested Amount and the Class A-1FX Initial Invested

Amount.

 

“Class A-1FX Invested Amount” shall mean, with

respect to any date an amount equal to the product of (a) the Class A-1

Invested Amount on such date and (b) a fraction the numerator of which is the

Class A-1FX Initial Invested Amount and the denominator of which is the sum of

the Class A-1FL Initial Invested Amount and the Class A-1FX Initial Invested

Amount.

 

“Class A-1 Invested Amount” shall mean, on any

date of determination, an amount equal to (a) the Class A-1 Initial Invested

Amount; minus

(b) the aggregate amount of principal payments made with respect to the Class

A-1 Notes prior to such date; minus (c) the amount by which the Class

A-1 Invested Amount has been reduced on or prior to such date due to Investor

Charge-Offs that have not been absorbed by a subordinate class of Notes pursuant

to Section 4.06(f); plus (d) the amount by which the Class A-1

Invested Amount has been increased on all prior Distribution Dates due to

reimbursements of Investor Charge-Offs pursuant to Section 4.06(g); and plus

(e) the amount by which the Class A-1 Invested Amount has been increased by the

application of Series Post Payment Adjustment Amounts (if such amount is positive)

on all prior Distribution Dates pursuant to Section 4.06(g); provided,

however, that the Class A-1 Invested Amount shall not be reduced

below zero nor shall it be increased above the Class A-1 Principal Balance.

 

“Class A-1FL Monthly Interest” shall have the

meaning specified in subsection 4.02(a).

 

“Class A-1FX Monthly Interest” shall have the

meaning specified in subsection 4.02(a).

 

“Class A-1FL Note Interest Rate” shall mean a

per annum rate of 0.75% in excess of LIBOR as determined on the related LIBOR

Determination Date with respect to each Interest Period.

 

“Class A-1FX Note Interest Rate” shall mean a

per annum rate of 4.096% with respect to each Interest Period.

 

“Class A-1 Noteholder” shall mean the Person in

whose name a Class A-1 Note is registered in the Note Register.

 

“Class A-1 Notes” shall mean the Class A-1FL

Notes and the Class A-1FX Notes.

 

5

 

“Class A-1FL Notes” shall mean any one of the

Class A-1FL Notes executed by the Issuer and authenticated by or on behalf of

the Indenture Trustee, substantially in the form of Exhibit A-1FL.

 

“Class A-1FX Notes” shall mean any one of the

Class A-1FX Notes executed by the Issuer and authenticated by or on behalf of

the Indenture Trustee, substantially in the form of Exhibit A-1FX.

 

“Class A-1FL Principal Balance” shall mean, on

any date of determination, an amount equal to (a) the Class A-1FL Initial

Invested Amount, minus (b) the aggregate amount of principal payments made to

the Class A-1FL Noteholders on or prior to such date.

 

“Class A-1FX Principal Balance” shall mean, on

any date of determination, an amount equal to (a) the Class A-1FX Initial

Invested Amount, minus (b) the aggregate amount of principal payments made to

the Class A-1FL Noteholders on or prior to such date.

 

“Class A-2FL Additional Interest” shall have

the meaning specified in subsection 4.02(b).

 

“Class A-2FX Additional Interest” shall have

the meaning specified in subsection 4.02(b).

 

“Class A-2FL Cumulative Monthly Interest” shall

mean, with respect to a Distribution Date, an amount equal to Class A-2FL

Monthly Interest for such Distribution Date plus Class A-2FL Monthly Interest

previously due but not distributed to Class A-2FL Noteholders on a prior

Distribution Date, plus the amount of any Class A-2FL

Additional Interest for such Distribution Date, plus the amount of any Class

A-2FL Additional Interest previously due but not distributed to Class A-2FL

Noteholders on a prior Distribution Date.

 

“Class A-2FX Cumulative Monthly Interest” shall

mean, with respect to a Distribution Date, an amount equal to Class A-2FX

Monthly Interest for such Distribution Date plus Class A-2FX Monthly Interest

previously due but not distributed to Class A-2FX Noteholders on a prior

Distribution Date, plus the amount of any Class A-2FX

Additional Interest for such Distribution Date, plus the amount of any Class

A-2FX Additional Interest previously due but not distributed to Class A-2FX

Noteholders on a prior Distribution Date.

 

“Class A-2FL Cumulative Subordinated Interest”

shall mean, with respect to a Distribution Date, an amount equal to interest on

the Class A-2FL Principal Balance due but not otherwise distributed to the

Class A-2FL Noteholders on such Distribution Date or any prior Distribution

Date pursuant to Section 4.05(a)(iv), at a rate per annum equal to the Class

A-2FL Note Interest Rate (on the same day count basis as the Class A-2FL

Monthly Interest) plus interest on any shortfalls with respect to such amounts

at the Class A-2FL Note Interest Rate.

 

“Class A-2FX Cumulative Subordinated Interest”

shall mean, with respect to a Distribution Date, an amount equal to interest on

the Class A-2FX Principal Balance due but not otherwise distributed to the

Class A-2FX Noteholders on such Distribution Date or any prior Distribution

Date pursuant to Section 4.05(a)(iv), at a rate per annum equal to the Class

A-2FX

 

6

 

Note Interest Rate (on the same day count basis as the Class A-2FX

Monthly Interest) plus interest on any shortfalls with respect to such amounts

at the Class A-2FX Note Interest Rate.

 

“Class A-2 Initial Invested Amount” shall mean

the sum of the Class A-2FL Initial Invested Amount and the Class A-2FX Initial

Invested Amount.

 

“Class A-2FL Initial Invested Amount” shall

mean $129,693,500.

 

“Class A-2FX Initial Invested Amount” shall

mean $58,101,000.

 

“Class A-2FL Interest Shortfall” shall have the

meaning specified in subsection 4.02(b).

 

“Class A-2FX Interest Shortfall” shall have the

meaning specified in subsection 4.02(b).

 

“Class A-2FL Invested Amount” shall mean, with

respect to any date an amount equal to the product of (a) the Class A-2

Invested Amount on such date and (b) a fraction the numerator of which is the

Class A-2FL Initial Invested Amount and the denominator of which is the sum of

the Class A-2FL Initial Invested Amount and the Class A-2FX Initial Invested

Amount.

 

“Class A-2FX Invested Amount” shall mean, with

respect to any date an amount equal to the product of (a) the Class A-2

Invested Amount on such date and (b) a fraction the numerator of which is the

Class A-2FX Initial Invested Amount and the denominator of which is the sum of

the Class A-2FL Initial Invested Amount and the Class A-2FX Initial Invested

Amount.

 

“Class A-2 Invested Amount” shall mean, on any

date of determination, an amount equal to (a) the Class A-2 Initial Invested

Amount; minus

(b) the aggregate amount of principal payments made with respect to the Class

A-2 Notes prior to such date; minus (c) the amount by which the Class

A-2 Invested Amount has been reduced on or prior to such date due to Investor

Charge-Offs that have not been absorbed by a subordinate class of Notes pursuant

to Section 4.06(e); plus (d) the amount by which the Class A-2

Invested Amount has been increased on all prior Distribution Dates due to

reimbursements of Investor Charge-Offs pursuant to Section 4.06(g); and plus

(e) the amount by which the Class A-2 Invested Amount has been increased by the

application of Series Post Payment Adjustment Amounts (if such amount is

positive) on all prior Distribution Dates pursuant to Section 4.06(g); provided,

however,  that the Class A-2

Invested Amount shall not be reduced below zero nor shall it be increased above

the Class A-2 Principal Balance

 

“Class A-2FL Monthly Interest” shall have the

meaning specified in subsection 4.02(b).

 

“Class A-2FX Monthly Interest” shall have the

meaning specified in subsection 4.02(b).

 

7

 

“Class A-2FL Note Interest Rate” shall mean a

per annum rate of 1.35% in excess of LIBOR as determined on the related LIBOR

Determination Date with respect to each Interest Period.

 

“Class A-2FX Note Interest Rate” shall mean a

per annum rate of 4.685% with respect to each Interest Period.

 

“Class A-2 Noteholder” shall mean the Person in

whose name a Class A-2 Note is registered in the Note Register.

 

“Class A-2 Notes” shall mean the Class A-2FL

Notes and the Class A-2FX Notes.

 

“Class A-2FL Notes” shall mean any one of the

Class A-2FL Notes executed by the Issuer and authenticated by or on behalf of

the Indenture Trustee, substantially in the form of Exhibit A-2FL.

 

“Class A-2FX Notes” shall mean any one of the

Class A-2FX Notes executed by the Issuer and authenticated by or on behalf of

the Indenture Trustee, substantially in the form of Exhibit A-2FX.

 

“Class A-2FL Principal Balance” shall mean, on

any date of determination, an amount equal to (a) the Class A-2FL Initial

Invested Amount, minus (b) the aggregate amount of principal payments made to

the Class A-2FL Noteholders on or prior to such date.

 

“Class A-2FX Principal Balance” shall mean, on

any date of determination, an amount equal to (a) the Class A-2FX Initial

Invested Amount, minus (b) the aggregate amount of principal payments made to

the Class A-2FX Noteholders on or prior to such date.

 

“Class A-3FL Additional Interest” shall have

the meaning specified in subsection 4.02(c).

 

“Class A-3FX Additional Interest” shall have

the meaning specified in subsection 4.02(c).

 

“Class A-3FL Cumulative Monthly Interest” shall

mean, with respect to a Distribution Date, an amount equal to Class A-3FL

Monthly Interest for such Distribution Date plus Class A-3FL Monthly Interest

previously due but not distributed to Class A-3FL Noteholders on a prior

Distribution Date, plus the amount of any Class A-3FL

Additional Interest for such Distribution Date, plus the amount of any Class

A-3FL Additional Interest previously due but not distributed to Class A-3FL

Noteholders on a prior Distribution Date.

 

“Class A-3FX Cumulative Monthly Interest” shall

mean, with respect to a Distribution Date, an amount equal to Class A-3FX

Monthly Interest for such Distribution Date plus Class A-3FX Monthly Interest

previously due but not distributed to Class A-3FX Noteholders on a prior

Distribution Date, plus the amount of any Class A-3FX

Additional Interest for such Distribution Date, plus the amount of any Class

A-3FX Additional Interest previously due but not distributed to Class A-3FX

Noteholders on a prior Distribution Date.

 

8

 

“Class A-3FL Cumulative Subordinated Interest”

shall mean, with respect to a Distribution Date, an amount equal to interest on

the Class A-3FL Principal Balance due but not otherwise distributed to the

Class A-3FL Noteholders on such Distribution Date or any prior Distribution

Date pursuant to Section 4.05(a)(v), at a rate per annum equal to the Class

A-3FL Note Interest Rate (on the same day count basis as the Class A-3FL Monthly

Interest) plus

interest on any shortfalls with respect to such amounts at the Class

A-3FL Note Interest Rate.

 

“Class A-3FX Cumulative Subordinated Interest”

shall mean, with respect to a Distribution Date, an amount equal to interest on

the Class A-3FX Principal Balance due but not otherwise distributed to the

Class A-3FX Noteholders on such Distribution Date or any prior Distribution

Date pursuant to Section 4.05(a)(v), at a rate per annum equal to the Class

A-3FX Note Interest Rate (on the same day count basis as the Class A-3FX

Monthly Interest) plus interest on any shortfalls with respect to such amounts

at the Class A-3FX Note Interest Rate.

 

“Class A-3 Initial Invested Amount” shall mean

the sum of the Class A-3FL Initial Invested Amount and the Class A-3FX Initial

Invested Amount.

 

“Class A-3FL Initial Invested Amount” shall

mean $57,732,700.

 

“Class A-3FX Initial Invested Amount” shall

mean $53,097,000.

 

“Class A-3FL Interest Shortfall” shall have the

meaning specified in subsection 4.02(c).

 

“Class A-3FX Interest Shortfall” shall have the

meaning specified in subsection 4.02(c).

 

“Class A-3FL Invested Amount” shall mean, with

respect to any date an amount equal to the product of (a) the Class A-3

Invested Amount on such date and (b) a fraction the numerator of which is the

Class A-3FL Initial Invested Amount and the denominator of which is the sum of

the Class A-3FL Initial Invested Amount and the Class A-3FX Initial Invested

Amount.

 

“Class A-3FX Invested Amount” shall mean, with

respect to any date an amount equal to the product of (a) the Class A-3

Invested Amount on such date and (b) a fraction the numerator of which is the

Class A-3FX Initial Invested Amount and the denominator of which is the sum of

the Class A-3FL Initial Invested Amount and the Class A-3FX Initial Invested

Amount.

 

“Class A-3 Invested Amount” shall mean, on any

date of determination, an amount equal to (a) the Class A-3 Initial Invested

Amount; minus

(b) the aggregate amount of principal payments made with respect to the Class

A-3 Notes prior to such date; minus (c) the amount by which the Class

A-3 Invested Amount has been reduced on or prior to such date due to Investor

Charge-Offs that have not been absorbed by a subordinate class of Notes pursuant

to Section 4.06(d); plus (d) the amount by which the Class A-3

Invested Amount has been increased on all prior Distribution Dates due to

reimbursements of Investor Charge-Offs pursuant to Section 4.06(g); and plus

(e) the amount by which the Class A-3 Invested Amount has been increased by the

application of Series Post Payment Adjustment Amounts (if such amount is

 

9

 

positive) on all prior Distribution Dates pursuant to Section 4.06(g); provided,

however,  that the Class A-3

Invested Amount shall not be reduced below zero nor shall it be increased above

the Class A-3 Principal Balance.

 

“Class A-3FL Monthly Interest” shall have the

meaning specified in subsection 4.02(c).

 

“Class A-3FX Monthly Interest” shall have the

meaning specified in subsection 4.02(c).

 

“Class A-3FL Note Interest Rate” shall mean a

per annum rate of 3.00% in excess of LIBOR as determined on the related LIBOR

Determination Date with respect to each Interest Period.

 

“Class A-3FX Note Interest Rate” shall mean a

per annum rate of 6.298% with respect to each Interest Period.

 

“Class A-3 Noteholder” shall mean the Person in

whose name a Class A-3 Note is registered in the Note Register.

 

“Class A-3 Notes” shall mean the Class A-3FL

Notes and the Class A-3FX Notes.

 

“Class A-3FL Notes” shall mean any one of the

Class A-3FL Notes executed by the Issuer and authenticated by or on behalf of

the Indenture Trustee, substantially in the form of Exhibit A-3FL.

 

“Class A-3FX Notes” shall mean any one of the

Class A-3FX Notes executed by the Issuer and authenticated by or on behalf of

the Indenture Trustee, substantially in the form of Exhibit A-3FX.

 

“Class A-3FL Principal Balance” shall mean, on

any date of determination, an amount equal to (a) the Class A-3FL Initial

Invested Amount, minus (b) the aggregate amount of principal payments made to

the Class A-3FL Noteholders on or prior to such date.

 

“Class A-3FX Principal Balance” shall mean, on

any date of determination, an amount equal to (a) the Class A-3FX Initial

Invested Amount, minus (b) the aggregate amount of principal payments made to

the Class A-3FL Noteholders on or prior to such date.

 

“Class A-4FL Additional Interest” shall have

the meaning specified in subsection 4.02(d).

 

“Class A-4FX Additional Interest” shall have

the meaning specified in subsection 4.02(d).

 

“Class A-4FL Cumulative Monthly Interest” shall

mean, with respect to a Distribution Date, an amount equal to Class A-4FL

Monthly Interest for such Distribution Date plus Class A-4FL Monthly Interest previously

due but not distributed to Class A-4FL Noteholders on a prior Distribution

Date, plus

the amount of any Class A-4FL Additional

10

 

Interest for such Distribution Date, plus the amount of any Class

A-4FL Additional Interest previously due but not distributed to Class A-4FL

Noteholders on a prior Distribution Date.

 

“Class A-4FX Cumulative Monthly Interest” shall

mean, with respect to a Distribution Date, an amount equal to Class A-4FX

Monthly Interest for such Distribution Date plus Class A-4FX Monthly Interest

previously due but not distributed to Class A-4FX Noteholders on a prior

Distribution Date, plus the amount of any Class A-4FX

Additional Interest for such Distribution Date, plus the amount of any Class

A-4FX Additional Interest previously due but not distributed to Class A-4FX

Noteholders on a prior Distribution Date.

 

“Class A-4FL Cumulative Subordinated Interest”

shall mean, with respect to a Distribution Date, an amount equal to interest on

the Class A-4FL Principal Balance due but not otherwise distributed to the

Class A-4FL Noteholders on such Distribution Date or any prior Distribution

Date pursuant to Section 4.05(a)(vi), at a rate per annum equal to the Class

A-4FL Note Interest Rate (on the same day count basis as the Class A-4FL

Monthly Interest) plus interest on any shortfalls with respect to such amounts

at the Class A-4FL Note Interest Rate.

 

“Class A-4FX Cumulative Subordinated Interest”

shall mean, with respect to a Distribution Date, an amount equal to interest on

the Class A-4FX Principal Balance due but not otherwise distributed to the

Class A-4FX Noteholders on such Distribution Date or any prior Distribution

Date pursuant to Section 4.05(a)(vi), at a rate per annum equal to the Class

A-4FX Note Interest Rate (on the same day count basis as the Class A-4FX

Monthly Interest) plus interest on any shortfalls with respect to such amounts

at the Class A-4FX Note Interest Rate.

 

“Class A-4 Initial Invested Amount” shall mean

the sum of the Class A-4FL Initial Invested Amount and the Class A-4FX Initial

Invested Amount.

 

“Class A-4FL Initial Invested Amount” shall

mean $96,553,500.

 

“Class A-4FX Initial Invested Amount” shall

mean $14,276,000.

 

“Class A-4FL Interest Shortfall” shall have the

meaning specified in subsection 4.02(d).

 

“Class A-4FX Interest Shortfall” shall have the

meaning specified in subsection 4.02(d).

 

“Class A-4FL Invested Amount” shall mean with

respect to any date an amount equal to the product of (a) the Class A-4 Invested

Amount on such date and (b) a fraction the numerator of which is the Class

A-4FL Initial Invested Amount and the denominator of which is the sum of the

Class A-4FL Initial Invested Amount and the Class A-4FX Initial Invested

Amount.

 

“Class A-4FX Invested Amount” shall mean with

respect to any date an amount equal to the product of (a) the Class A-4

Invested Amount on such date and (b) a fraction the numerator of which is the

Class A-4FX Initial Invested Amount and the denominator of which is the sum of

the Class A-4FL Initial Invested Amount and the Class A-4FX Initial Invested

Amount.

 

11

 

“Class A-4 Invested Amount” shall mean, on any

date of determination, an amount equal to (a) the Class A-4 Initial Invested

Amount; minus

(b) the aggregate amount of principal payments made with respect to the Class

A-4 Notes prior to such date; minus (c) the amount by which the Class

A-4 Invested Amount has been reduced on or prior to such date due to Investor

Charge-Offs that have not been absorbed by a subordinate class of Notes pursuant

to Section 4.06(c); and plus (d) the amount by which the Class A-4

Invested Amount has been increased on all prior Distribution Dates due to

reimbursements of Investor Charge-Offs pursuant to Section 4.06(g); and plus

(e) the amount by which the Class A-4 Invested Amount has been increased by the

application of Series Post Payment Adjustment Amounts (if such amount is

positive) on all prior Distribution Dates pursuant to Section 4.06(g); provided,

however, that the Class A-4 Invested Amount shall not be reduced

below zero nor shall it be increased above the Class A-4 Principal Balance.

 

“Class A-4FL Monthly Interest” shall have the

meaning specified in subsection 4.02(d).

 

“Class A-4FX Monthly Interest” shall have the

meaning specified in subsection 4.02(d).

 

“Class A-4FL Note Interest Rate” shall mean a

per annum rate of 5.50% in excess of LIBOR as determined on the related LIBOR

Determination Date with respect to each Interest Period.

 

“Class A-4FX Note Interest Rate” shall mean a

per annum rate of 8.721% with respect to each Interest Period.

 

“Class A-4 Noteholder” shall mean the Person in

whose name a Class A-4 Note is registered in the Note Register.

 

“Class A-4 Notes” shall mean the Class A-4FL

Notes and the Class A-4FX Notes.

 

“Class A-4FL Notes” shall mean any one of the

Class A-4FL Notes executed by the Issuer and authenticated by or on behalf of

the Indenture Trustee, substantially in the form of Exhibit A-4FL.

 

“Class A-4FX Notes” shall mean any one of the

Class A-4FX Notes executed by the Issuer and authenticated by or on behalf of

the Indenture Trustee, substantially in the form of Exhibit A-4FX.

 

“Class A-4FL Principal Balance” shall mean, on

any date of determination, an amount equal to (a) the Class A-4FL Initial

Invested Amount, minus (b) the aggregate amount of principal payments made to

the Class A-4FL Noteholders on or prior to such date.

 

“Class A-4FX Principal Balance” shall mean, on

any date of determination, an amount equal to (a) the Class A-4FX Initial

Invested Amount, minus (b) the aggregate amount of principal payments made to

the Class A-4FX Noteholders on or prior to such date.

 

“Class B Initial Invested Amount” shall mean

$89,279,000.

 

12

 

“Class B Invested Amount” shall mean, on any

date of determination, an amount equal to (a) the Class B Initial Invested

Amount; minus

(b) the aggregate amount of principal payments made with respect to the Class B

Notes prior to such date; minus (c) the amount by which the Class B

Invested Amount has been reduced on or prior to such date due to Investor

Charge-Offs that have not been absorbed by the O/C Invested Amount pursuant to

Section 4.06(b); plus (d) the amount by which the Class B Invested Amount has

been increased on all prior Distribution Dates due to reimbursements of

Investor Charge-Offs pursuant to Section 4.06(g); and plus (e) the amount by which

the Class B Invested Amount has been increased by the application of Series

Post Payment Adjustment Amounts (if such amount is positive) on all prior

Distribution Dates pursuant to Section 4.06(g); provided, however, that the

Class B Invested Amount shall not be reduced below zero nor shall it be

increased above the Class B Principal Balance.

 

“Class B Investor Charge-Offs” shall mean, with

respect to any Distribution Date, the aggregate amount by which the Class B

Invested Amount has been reduced on all prior Distribution Dates as the result

of Investor Charge-Offs pursuant to Section 4.06 hereof.

 

“Class B Investor Default Amount” shall mean,

with respect to any Monthly Period, the product of (a) the Investor Default

Amount for such Monthly Period and (b) a fraction, the numerator of which is

the Class B Invested Amount and the denominator of which is the Invested Amount

on the day of determination.

 

“Class B Monthly Interest” shall have the

meaning specified in subsection 4.02(e).

 

 

“Class B Note Interest Rate” shall mean a per

annum rate of 10.0% in excess of LIBOR as determined on the related LIBOR

Determination Date with respect to each Interest Period; provided that the Class B

Note Interest Rate shall not exceed the Class B Note Interest Rate Cap.

 

“Class B Note Interest Rate Cap” shall mean

15.0% for the first 12 Distribution Dates, 16.0% for the 13th through 24th

Distribution Dates, 17.0% for the next 25th through 36th Distribution Dates and

18.0% for all remaining Distribution Dates.

 

“Class B Noteholder” shall mean the Person in

whose name a Class B Note is registered in the Note Register.

 

“Class B Notes” shall mean any one of the Class

B Notes executed by the Issuer and authenticated by or on behalf of the

Indenture Trustee, substantially in the form of Exhibit B.

 

“Class B Principal Balance” shall mean, on any

date of determination, an amount equal to (a) the Class B Initial Invested

Amount, minus

(b) the aggregate amount of principal payments made to the Class B Noteholders

on or prior to such date.

 

“Clean-up Call” shall have the meaning

specified in Section 7.01(a).

 

“Closing Date” shall mean June 25, 2002.

 

13

 

“Discounted Recoveries“ shall mean any proceeds

received by the Issuer from (i) the repurchase of Receivables at a discount by

the Accounts Owner from the Transferor pursuant to the terms of the Receivables

Purchase Agreement and (ii) the repurchase of Receivables at a discount by

Providian under the terms of the Receivables Purchase Agreement which are the

subject of a credit provided to the related cardholder in connection with the

Class Action Settlement (as such term is defined in the Receivables Purchase

Agreement).

 

“Distribution Date” shall mean July 17, 2002

and the seventeenth day of each calendar month thereafter, or if such

seventeenth day is not a Business Day, the next succeeding Business Day.

 

“Estimated Required Coverage Amount” shall mean

with respect to any date in a Monthly Period the sum of (i) Monthly Interest

due on the Distribution Date relating to such Monthly Period, calculated using

LIBOR on the most recent LIBOR Determination Date, (ii) the Program Expenses

due to be paid on the Distribution Date relating to such Monthly Period and

(iii) the estimated Monthly Servicing Fee due on the Distribution Date relating

to such Monthly Period, assuming for the purposes of calculating the estimated

Monthly Servicing Fee that the amount of Principal Receivables and Finance

Charge Receivables on the last day of the related Monthly Period is the greater

of the amount of Principal Receivables and Finance Charge Receivables on the

first day of such Monthly Period and the date of calculation.

 

“Excess Program Expenses” shall mean the

product of (i) any indemnity obligation of the Issuer to the Indenture Trustee,

the Note Administrator, the Owner Trustee, the Certificate Administrator or the

Certificate Trustee in any one-year period beginning on the Closing Date and on

each anniversary thereof in excess of $72,500 in the aggregate and (ii) a

fraction, the numerator of which is the Invested Amount as of the last day of

the immediately preceding Monthly Period (or with respect to the first Monthly

Period, the initial Invested Amount) and the denominator of which is the

Invested Amount for Series 2002-1 and for Series 2002-A.

 

“Final Maturity Date” shall mean the Distribution

Date occurring in June 2012.

 

“Fixed Allocation Percentage” shall mean an

amount equal to, with respect to any Monthly Period during a Rapid Amortization

Period, Partial Reinvestment Period or the Scheduled Amortization Period, the

percentage equivalent of a fraction, the numerator of which is the Invested

Amount as of close of business on the last day of either the Reinvestment

Period or the Special Reinvestment Period, whichever precedes such period, and

the denominator of which is the greater of (a) the aggregate amount of

Principal Receivables and Finance Charge Receivables as of the close of

business on the last day of the prior Monthly Period (or with respect to the

first Monthly Period, the aggregate amount of Principal Receivables and Finance

Charge Receivables as of the Closing Date) and (b) the sum of the

numerators used to calculate the allocation percentages with respect to

Collections of Principal Receivables for all outstanding Series on the date of

determination.

 

“Floating Allocation Percentage” shall mean an

amount equal to, with respect to any Monthly Period, the percentage equivalent

of a fraction, the numerator of which is the Invested Amount as of the last day

of the immediately preceding Monthly Period (or with respect

 

14

 

to the first Monthly Period, the Initial Invested Amount) and the

denominator of which is the greater of (a) the aggregate amount of Principal

Receivables and Finance Charge Receivables as of the last day of the prior

Monthly Period (or with respect to the first Monthly Period, the aggregate

amount of Principal Receivables and Finance Charge Receivables as of the

Closing Date) and (b) the sum of the numerators used to calculate the Floating

Allocation Percentage for all Series.

 

“Initial Invested Amount” shall mean the sum of

the Class A-1 Initial Invested Amount, the Class A-2 Initial Invested Amount,

the Class A-3 Initial Invested Amount, the Class A-4 Initial Invested Amount

the Class B Initial Invested Amount and the O/C Initial Invested Amount.

 

“Insolvency Event” shall mean with respect to

any party, such party’s consent to the appointment of a conservator or receiver

or liquidator in any insolvency, readjustment of debt, marshaling of assets and

liabilities or similar proceedings of or relating to such party or of or

relating to all or substantially all of its property, or a decree or order of a

court or agency or supervisory authority having jurisdiction in the premises

for the appointment of a conservator or receiver or liquidator in any

insolvency, readjustment of debt, marshaling of assets and liabilities or

similar proceedings, or for the winding-up or liquidation of its affairs, shall

have been entered against such party; or such party’s admission in writing of

its inability to pay its debts generally as they become due, filing a petition

to take advantage of any applicable insolvency or reorganization statute, or

making any assignment for the benefit of its creditors.

 

“Interest Period” shall mean, with respect to

any Distribution Date, the period from and including the Distribution Date

immediately preceding such Distribution Date (or, in the case of the first

Distribution Date, from and including the Closing Date) to but excluding such

Distribution Date.

 

“Invested Amount” shall mean the sum of the

Class A-1 Invested Amount, the Class A-2 Invested Amount, the Class A-3

Invested Amount, the Class A-4 Invested Amount, the Class B Invested Amount and

the O/C Invested Amount.

 

“Investor Charge-Offs” shall have the meaning

specified in Section 4.06.

 

“Investor Default Amount” shall mean, with

respect to any Monthly Period, an amount equal to the product of (a) the

Defaulted Amount for such Monthly Period and (b) the Floating Allocation

Percentage for such Monthly Period.

 

“LIBOR” shall have the meaning specified in

Section 4.09.

 

“LIBOR Determination Date” shall mean (i) June

21, 2002 for the first Interest Period and (ii) the second London Business Day

prior to the commencement of the second and each subsequent Interest Period.

 

“London Business Day” shall mean any Business

Day on which dealings in deposits in United States dollars are transacted in

the London interbank market.

 

“Monthly Servicing Fee” shall have the meaning

specified in Section 3.01.

 

15

 

“Notes” shall mean the Class A-1 Notes, the

Class A-2 Notes, the Class A-3 Notes, the Class A-4 Notes and the Class B

Notes.

 

“O/C Certificate” shall mean the certificate

issued by the Issuer representing the right to receive all amounts distributed

hereunder in respect of the O/C Invested Amount,  substantially in the form of Exhibit C.

 

“O/C Holder” shall mean the holder of the O/C

Certificate.

 

“O/C Initial Invested Amount” shall mean

$517,207,554.

 

“O/C Invested Amount” shall mean, on any date

of determination, an amount equal to (a) the O/C Initial Invested Amount; minus

(b) the aggregate amount of payments with respect to the O/C Invested Amount on

or prior to such date; minus (c) the amount by which the O/C

Invested Amount has been reduced on or prior to such date due to Investor

Charge-Offs pursuant to Section 4.06(a); plus (d) the amount by which the O/C

Invested Amount has been increased on all prior Distribution Dates due to

reimbursements of Investor Charge-Offs pursuant to Section 4.06(g); and plus

(e) the amount by which the O/C Invested Amount has been increased by the

application of Series Post Payment Adjustment Amounts (if such amount is

positive) on all prior Distribution Dates pursuant to Section 4.06(g); provided

that the O/C Invested Amount shall not be reduced below zero.

 

“O/C Investor Charge-Offs” shall mean, with

respect to any Distribution Date, the aggregate amount by which the O/C

Invested Amount has been reduced on all prior Distribution Dates as the result

of Investor Charge-Offs pursuant to Section 4.06 hereof.

 

“O/C Investor Default Amount” shall mean, with

respect to any Monthly Period, the product of (a) the Investor Default Amount

for such Monthly Period and (b) a fraction, the numerator of which is the O/C

Invested Amount and the denominator of which is the Invested Amount on the day

of determination.

 

“O/C Principal Percentage” shall mean an amount

equal to, with respect to any date, the percentage equivalent of a fraction,

the numerator of which is (a) the product of the aggregate amount of Principal

Receivables on such date and the Floating Allocation Percentage as of such date

minus

(b) the sum of the Class A Invested Amount and the Class B Invested Amount as

of such date and the denominator of which is the product of the aggregate

amount of Principal Receivables on such date and the Floating Allocation

Percentage as of such date.

 

“O/C Reduction Amount” shall have the meaning

set forth in Section 7.01(c).

 

“Partial Reinvestment Period” shall mean (if a

Redemption Event or the commencement of the Scheduled Amortization Period has

not occurred earlier) the period, if any, beginning on the first day of the

Monthly Period in which the O/C Principal Percentage (after application of all

collections on the Distribution Date on which it is calculated) is below 26.75%

and at least 22.0% and ending on the earlier of (a) the close of business

on the last day of the Monthly Period immediately preceding the Distribution

Date on which the O/C Principal Percentage is at least 26.75% and has been at

least 26.75% for each of the two Distribution Dates immediately preceding such

Distribution Date, in which case a Special Reinvestment Period or

 

16

 

the Reinvestment Period, as applicable, would resume, (b) the

commencement of a Rapid Amortization Period and (c) the commencement of the

Scheduled Amortization Period.

 

“Pre-Adjustment Invested Amount” shall mean on

each Distribution Date (a) the Invested Amount as of the end of the prior

Monthly Period minus (b) the amount by which the Investor Default Amount

exceeds the amount of Available Finance Charge Collections allocated to fund

such amount on such Distribution Date minus (c) the amount of Reallocated

Principal Collections on such Distribution Date minus (d) the amount of

principal paid to reduce the Invested Amount on such Distribution Date plus (e)

the amount of prior Investor Charge-Offs to be reimbursed on such Distribution

Date.

 

“Pre-Adjustment Transferor Amount” shall mean

on each Distribution Date the Transferor Amount as of the end of the prior

Monthly Period minus all Defaulted Amounts and Collections allocated to the

Transferor Amount on the related Determination Date.

 

“Principal Balance” shall mean when used with

respect to any class of Notes, the initial Invested Amount of such class of

Notes minus

the aggregate amount of principal payments made with respect to such class of

Notes.  When used with respect to the

Notes in the aggregate, the sum of the Class A-1 Principal Balance, the Class

A-2 Principal Balance, the Class A-3 Principal Balance, the Class A-4 Principal

Balance and the Class B Principal Balance.

 

“Program Expenses” shall mean the product of

(i) a fraction, the numerator of which is the Invested Amount as of the last

day of the immediately preceding Monthly Period (or with respect to the first

Monthly Period, the initial Invested Amount) and the denominator of which is

the Invested Amount for Series 2002-1 and Series 2002-A and (ii) the fees and

expenses of the Indenture Trustee, the Note Administrator, the Owner Trustee,

the Certificate Administrator and the Certificate Trustee as specified in each

of the related fee agreements with each such party, and any indemnity

obligation of the Issuer to each such party, provided that such indemnity

obligation shall not exceed in the aggregate $72,500 in any one-year period

beginning on the Closing Date and on each anniversary thereof.

 

“Rapid Amortization Period” shall mean the

period commencing at the close of business on the Business Day immediately

preceding the day on which a Redemption Event is deemed to have occurred, and

ending on the first to occur of (i) the payment in full of the Principal

Balance of the Notes and the reduction of the O/C Invested Amount to zero and

(ii) the Final Maturity Date.

 

“Reallocated Principal Collections” shall mean,

with respect to any Distribution Date, the amount of Available Principal

Collections applied by the Indenture Trustee pursuant to Section 4.05(b)(i).

 

“Redemption Amount” shall mean with respect to

any day, the Principal Balance and any accrued and unpaid interest due on the

Notes plus

any amounts due and unpaid with respect to Program Expenses plus

any accrued and unpaid Monthly Servicing Fee (after giving effect as

appropriate to any deposits and distributions otherwise to be made on such day

if such day is a Distribution Date).

 

17

 

“Redemption Event” shall mean, with respect to

Series 2002-1, a Trust Redemption Event or a Series 2002-1 Redemption Event.

 

“Redemption Event Issuance” shall have the

meaning specified in Section 7.01(b).

 

“Redemption upon Auction” shall have the

meaning specified in Section 7.01(c).

 

“Reinvestment Period” shall mean the period

beginning on the Closing Date and ending on the earlier of (a) the close

of business on the day immediately preceding the day the Scheduled Amortization

Period commences or (b) the close of business on the day immediately

preceding the day a Rapid Amortization Period, a Special Reinvestment Period,

or a Partial Reinvestment Period commences; provided, however, that prior to the

commencement of the Scheduled Amortization Period or a Rapid Amortization

Period, a Special Reinvestment Period or a Partial Reinvestment Period may end

and the Reinvestment Period may resume on a Distribution Date after the O/C

Principal Percentage has been at least 29.0% and the Subordinated Principal

Percentage has been at least 25.0% for three consecutive Distribution Dates

since the commencement of the Special Reinvestment Period or Partial

Reinvestment Period.

 

“Required Coverage Amount” shall have the

meaning specified in Section 4.04.

 

“Scheduled Amortization Date” shall mean June

1, 2005.

 

“Scheduled Amortization Period” shall mean,

unless a Redemption Event with respect to Series 2002-1 shall have occurred

prior thereto, the period commencing on the Scheduled Amortization Date and

ending upon the first to occur of (x) the commencement of the Rapid

Amortization Period, (y) the payment in full of the Principal Balance of

the Notes and the reduction of the O/C Invested Amount to zero and (z) the

Final Maturity Date.

 

“Series 2002-1” shall mean the Series the terms

of which are specified in this Indenture Supplement.

 

“Series 2002-1 Notes” shall have the meaning

set forth in Section 1.01(a).

 

“Series Post Payment Adjustment Amount” shall

mean an amount equal to the product of (i) (a) the Pre-Adjustment Invested

Amount relating to Series 2002-1 divided by (b) the Pre-Adjustment

Invested Amounts for all outstanding Series and (ii) the Trust Post Payment

Adjustment Amount.

 

“Series Redemption Event” shall have the

meaning specified in Section 6.01.

 

“Servicing Fee Rate” shall mean 5.00% per

annum.

 

“Shared Principal Collections” shall mean

Shared Principal Collections as defined and described in Section 8.05 of the

Indenture; and amounts to be treated as Shared Principal Collections under this

Indenture Supplement are described in Section 4.05(b)(v).

 

18

 

“Special Reinvestment Period” shall mean (if a

Redemption Event or the commencement of the Scheduled Amortization Period has

not occurred earlier) the period, if any, beginning on the first day of the

Monthly Period in which either (a) the O/C Principal Percentage is below 29.0%

and at least 26.75% or (b) the Subordinated Principal Percentage (after

application of all collections on the Distribution Date on which it is

calculated) is less than 25.0% and ending on the earliest of (a) the close

of business on the last day of the Monthly Period immediately preceding the

Distribution Date on which (i) the O/C Principal Percentage is at least 29.0%

and has been at least 29.0% for each of the two Distribution Dates immediately

preceding such Distribution Date and (ii) the Subordinated Principal Percentage

is at least 25.0% and has been at least 25.0% for each of the two Distribution

Dates immediately preceding such Distribution Date, in which case the

Reinvestment Period would resume, (b) the commencement of a Partial

Reinvestment Period, (c) the commencement of a Rapid Amortization Period and

(d) the commencement of the Scheduled Amortization Period.

 

“Special VFN Allocation” shall have the meaning

set forth in Indenture Supplement relating to the Variable Funding Notes.

 

“Statement to Noteholders” shall have the

meaning specified in Section 5.03.

 

“Subordinated Principal Percentage” shall mean

an amount equal to, with respect to any date, the percentage equivalent of a

fraction, the numerator of which is (a) the product of the aggregate amount of

Principal Receivables on such date and the Floating Allocation Percentage minus

(b) the Class A Invested Amount and the denominator of which is the aggregate

amount of Principal Receivables as of the Cut-Off Date.

 

“Telerate Page 3750“ shall mean the display

page currently so designated on the Moneyline Telerate Service (or any other

page as may replace that page on that service for the purpose of displaying

comparable rates or prices).

 

“Transfer” shall have the meaning set forth in

Section 8.06.

 

“Transferor Amount Reduction Amount” shall mean

the amount required to reduce the Transferor Amount to zero.

 

“Trust Post Payment Adjustment Amount” shall

mean on each Distribution Date an amount (which may be positive or negative)

equal to (i) the aggregate balance of Principal Receivables and Finance Charge

Receivables as of the end of the prior Monthly Period minus (ii) the sum of (x)

the Pre-Adjustment Invested Amounts for all Series and (y) the Pre-Adjustment

Transferor Amount.

 

“Variable Funding Notes” shall mean the

Issuer’s Series 2002-A Variable Funding Notes.

 

“VFN Reduction Amount” shall mean an amount

equal to the outstanding Principal Balance (as such term is defined in the

related Indenture Supplement) of the Variable Funding Notes or such lesser

amount agreed to by the holders of the Variable Funding Notes.

 

19

 

(b)   Each capitalized term defined herein shall

relate to the Series 2002-1 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 the Indenture or the Transfer and Servicing

Agreement.  In the event that any term

or provision contained herein shall conflict with or be inconsistent with any

term or provision contained in the Indenture or the Transfer and Servicing

Agreement, the terms and provisions of this Indenture Supplement shall govern.

 

(c)   The words “hereof,” “herein,” “hereunder” and

words of similar import when used in this Indenture Supplement shall refer to

this Indenture Supplement as a whole and not to any particular provision of

this Indenture Supplement; references to any Article, subsection, Section or

Exhibit are references to Articles, subsections, Sections and Exhibits in or to

this Indenture Supplement unless otherwise specified; and the term “including”

means “including without limitation.”

 

[END OF ARTICLE II]

 

20

 

ARTICLE III

 

Servicing Fee

 

Section 3.01.          Servicing

Compensation.  The

share of the Servicing Fee allocable to the Invested Amount with respect to any

Distribution Date (the “Monthly Servicing Fee”) shall be equal

to one-twelfth (or, with respect to the first Distribution Date, 5/360) of the

product of (a) the Servicing Fee Rate, (b) the Floating Allocation

Percentage and (c)(i) the sum of (A) the amount of Principal Receivables and

Finance Charge Receivables on the first day of the Monthly Period preceding

such Distribution Date (or, with respect to the first Distribution Date, the

Closing Date) and (B) the amount of Principal Receivables and Finance Charge

Receivables on the last day of the Monthly Period preceding such Distribution

Date divided by (ii) two.

 

[END OF ARTICLE III]

 

21

 

ARTICLE IV

Rights of Series 2002-1

Noteholders 

and Allocation and Application of Collections

 

Section 4.01.          Collections

and Allocations.

 

(a)   Allocations.  Prior to the close of business on each Deposit Date, Collections

of Finance Charge Receivables, Principal Receivables and Defaulted Receivables

allocated to Series 2002-1 pursuant to Article VIII of the Indenture shall be

allocated as set forth in this Article.

 

(b)   Allocations to the Series 2002-1

Noteholders.  The Servicer shall

allocate to Series 2002-1 on each Deposit Date the following amounts as set

forth below:

 

(i)  Allocations

of Finance Charge Collections.  The

Servicer shall allocate to Series 2002-1 and retain in the Collection Account

for application as provided herein in an amount equal to the product of (A) the

Floating Allocation Percentage and (B) the aggregate amount of Collections of

Finance Charge Receivables received by the Servicer and deposited to the

Collection Account with respect to such Deposit Date.

 

(ii)  Allocations

of Principal Collections.  The

Servicer shall allocate collections of Principal Receivables to Series 2002–1

as provided herein in an amount equal to the product of (A) during the

Reinvestment Period or the Special Reinvestment Period, the Floating Allocation

Percentage and during the Partial Reinvestment Period, Scheduled Amortization

Period or  Rapid Amortization

Period,  the Fixed Allocation Percentage

and (B) the aggregate amount of Collections of Principal Receivables

received by the Servicer and deposited to the Collection Account with respect

to such Deposit Date.

 

Section 4.02.          Determination

of Monthly Interest.

 

(a)  The amount

of monthly interest distributable from the Collection Account with respect to

the Class A-1FL Notes pursuant to Section 4.05(a)(iii) on any Distribution Date

(“Class

A-1FL Monthly Interest”) shall be an amount equal to the product

of (i) a fraction, the numerator of which is the actual number of days in the

related Interest Period and the denominator of which is 360 and (ii) the Class

A-1FL Note Interest Rate in effect with respect to the related Interest Period

and (iii) the Class A-1FL Invested Amount 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-1FL Initial Invested Amount).  The holders of the Class A-1FL Notes will

also be entitled to receive distributions in respect of interest on each

Distribution Date as provided in Section 4.05(a)(viii).

 

The amount of monthly interest distributable from the

Collection Account with respect to the Class A-1FX Notes pursuant to Section

4.05(a)(iii) on any Distribution Date

 

22

 

(“Class A-1FX Monthly Interest”) shall be an amount equal to

the product of (i) a fraction, the numerator of which is 30 (except for the

first Interest Period, when the numerator will be 22) and the denominator of which

is 360, (ii) the Class A-1FX Note Interest Rate in effect with respect to the

related Interest Period and (iii) the Class A-1FX Invested Amount 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-1FX Initial Invested

Amount).  The holders of the Class A-1FX

Notes will also be entitled to receive distributions in respect of interest on

each Distribution Date as provided in Section 4.05(a)(viii).

 

On the Determination Date preceding each Distribution

Date, the Servicer shall determine the excess, if any (the “Class

A-1FL Interest Shortfall”), of (x) the Class A-1FL Monthly

Interest for such Distribution Date over (y) the aggregate amount of funds

allocated and available to pay such Class A-1FL Monthly Interest on such

Distribution Date.  If the Class A-1FL

Interest Shortfall with respect to any Distribution Date is greater than zero,

on each subsequent Distribution Date until such Class A-1FL Interest Shortfall

is fully paid, an additional amount (“Class A-FL Additional Interest”)

equal to the product of (i) a fraction, the numerator of which is the actual

number of days in the related Interest Period and the denominator of which is

360, times (ii) the Class A-1FL Note Interest Rate in effect with respect to

the related Interest Period times (iii) such Class A-1FL Interest Shortfall (or

the portion thereof which has not been paid to the Class A-1FL Noteholders)

shall be payable as provided herein with respect to the Class A-1FL Notes.  Notwithstanding anything to the contrary

herein, Class A-1FL Additional Interest shall be payable or distributed to the

Class A-1FL Noteholders only to the extent permitted by applicable law.

 

On the Determination Date preceding each Distribution

Date, the Servicer shall determine the excess, if any (the “Class

A-1FX Interest Shortfall”), of (x) the Class A-1FX Monthly

Interest for such Distribution Date over (y) the aggregate amount of funds

allocated and available to pay such Class A-1FX Monthly Interest on such

Distribution Date.  If the Class A-1FX

Interest Shortfall with respect to any Distribution Date is greater than zero,

on each subsequent Distribution Date until such Class A-1FX Interest Shortfall

is fully paid, an additional amount (“Class A-1FX Additional Interest”)

equal to the product of (i) a fraction, the numerator of which is 30 and the

denominator of which is 360, times (ii) the Class A-1FX Note Interest Rate in

effect with respect to the related Interest Period times (iii) such Class A-1FX

Interest Shortfall (or the portion thereof which has not been paid to the Class

A-1FX Noteholders) shall be payable as provided herein with respect to the

Class A-1FX Notes.  Notwithstanding

anything to the contrary herein, Class A-1FX Additional Interest shall be

payable or distributed to the Class A-1FX Noteholders only to the extent

permitted by applicable law.

 

(b)  The amount

of monthly interest distributable from the Collection Account with respect to

the Class A-2FL Notes pursuant to Section 4.05(a)(iv) on any Distribution Date

(“Class

A-2FL Monthly Interest”) shall be an amount equal to the product

of (i) a fraction, the numerator of which is the actual number of days in the

related Interest Period and the denominator of which is 360 and (ii) the Class

A-2FL Note Interest Rate in effect with respect to the related Interest Period

and (iii) the Class A-2FL Invested Amount 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-2FL Initial Invested Amount).  The holders of the Class A-2FL Notes will

also be

 

23

 

entitled to receive distributions in respect of interest on each

Distribution Date as provided in Section 4.05(a)(ix).

 

The amount of monthly interest distributable from the

Collection Account with respect to the Class A-2FX Notes pursuant to Section

4.05(a)(iv) on any Distribution Date (“Class A-2FX Monthly Interest”) shall be

an amount equal to the product of (i) a fraction, the numerator of which is 30

(except for the first Interest Period, when the numerator will be 22) and the

denominator of which is 360, (ii) the Class A-2FX Note Interest Rate in effect

with respect to the related Interest Period and (iii) the Class A-2FX Invested

Amount 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-2FX

Initial Invested Amount).  The holders

of the Class A-2FX Notes will also be entitled to receive distributions in

respect of interest on each Distribution Date as provided in Section

4.05(a)(ix).

 

On the Determination Date preceding each Distribution

Date, the Servicer shall determine the excess, if any (the “Class

A-2FL Interest Shortfall”), of (x) the Class A-2FL Monthly

Interest for such Distribution Date over (y) the aggregate amount of funds

allocated and available to pay such Class A-2FL Monthly Interest on such

Distribution Date.  If the Class A-2FL

Interest Shortfall with respect to any Distribution Date is greater than zero,

on each subsequent Distribution Date until such Class A-2FL Interest Shortfall

is fully paid, an additional amount (“Class A-2FL Additional Interest”)

equal to the product of (i) a fraction, the numerator of which is the actual

number of days in the related Interest Period and the denominator of which is

360, times (ii) the Class A-2FL Note Interest Rate in effect with respect to

the related Interest Period times (iii) such Class A-2FL Interest Shortfall (or

the portion thereof which has not been paid to the Class A-2FL Noteholders)

shall be payable as provided herein with respect to the Class A-2FL Notes.  Notwithstanding anything to the contrary

herein, Class A-2FL Additional Interest shall be payable or distributed to the

Class A-2FL Noteholders only to the extent permitted by applicable law.

 

On the Determination Date preceding each Distribution

Date, the Servicer shall determine the excess, if any (the “Class

A-2FX Interest Shortfall”), of (x) the Class A-2FX Monthly

Interest for such Distribution Date over (y) the aggregate amount of funds

allocated and available to pay such Class A-2FX Monthly Interest on such

Distribution Date.  If the Class A-2FX

Interest Shortfall with respect to any Distribution Date is greater than zero,

on each subsequent Distribution Date until such Class A-2FX Interest Shortfall

is fully paid, an additional amount (“Class A-2FX Additional Interest”)

equal to the product of (i) a fraction, the numerator of which is 30 and the

denominator of which is 360, times (ii) the Class A-2FX Note Interest Rate in

effect with respect to the related Interest Period times (iii) such Class A-2FX

Interest Shortfall (or the portion thereof which has not been paid to the Class

A-2FX Noteholders) shall be payable as provided herein with respect to the

Class A-2FX Notes.  Notwithstanding

anything to the contrary herein, Class A-2FX Additional Interest shall be

payable or distributed to the Class A-2FX Noteholders only to the extent

permitted by applicable law.

 

(c)  The amount

of monthly interest distributable from the Collection Account with respect to

the Class A-3FL Notes pursuant to Section 4.05(a)(v) on any Distribution Date

(“Class

A-3FL Monthly Interest”) shall be an amount equal to the product

of (i) a fraction, the

 

24

 

numerator of which is the actual number of days in the related Interest

Period and the denominator of which is 360 and (ii) the Class A-3FL Note

Interest Rate in effect with respect to the related Interest Period and (iii)

the Class A-3FL Invested Amount 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-3FL Initial Invested Amount).  The holders of the Class A-3FL Notes will also be entitled to

receive distributions in respect of interest on each Distribution Date as

provided in Section 4.05(a)(x).

 

The amount of monthly interest distributable from the

Collection Account with respect to the Class A-3FX Notes pursuant to Section

4.05(a)(v) on any Distribution Date (“Class A-3FX Monthly Interest”) shall be

an amount equal to the product of (i) a fraction, the numerator of which is 30

(except for the first Interest Period, when the numerator will be 22) and the

denominator of which is 360, (ii) the Class A-3FX Note Interest Rate in effect

with respect to the related Interest Period and (iii) the Class A-3FX Invested

Amount 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-3FX Initial

Invested Amount).  The holders of the

Class A-3FX Notes will also be entitled to receive distributions in respect of

interest on each Distribution Date as provided in Section 4.05(a)(x).

 

On the Determination Date preceding each Distribution

Date, the Servicer shall determine the excess, if any (the “Class

A-3FL Interest Shortfall”), of (x) the Class A-3FL Monthly

Interest for such Distribution Date over (y) the aggregate amount of funds

allocated and available to pay such Class A-3FL Monthly Interest on such

Distribution Date.  If the Class A-3FL

Interest Shortfall with respect to any Distribution Date is greater than zero,

on each subsequent Distribution Date until such Class A-3FL Interest Shortfall

is fully paid, an additional amount (“Class A-3FL Additional Interest”)

equal to the product of (i) a fraction, the numerator of which is the actual

number of days in the related Interest Period and the denominator of which is

360, times (ii) the Class A-3FL Note Interest Rate in effect with respect to

the related Interest Period times (iii) such Class A-3FL Interest Shortfall (or

the portion thereof which has not been paid to the Class A-3FL Noteholders)

shall be payable as provided herein with respect to the Class A-3FL Notes.  Notwithstanding anything to the contrary

herein, Class A-3FL Additional Interest shall be payable or distributed to the

Class A-3FL Noteholders only to the extent permitted by applicable law.

 

On the Determination Date preceding each Distribution

Date, the Servicer shall determine the excess, if any (the “Class

A-3FX Interest Shortfall”), of (x) the Class A-3FX Monthly

Interest for such Distribution Date over (y) the aggregate amount of funds

allocated and available to pay such Class A-3FX Monthly Interest on such

Distribution Date.  If the Class A-3FX

Interest Shortfall with respect to any Distribution Date is greater than zero,

on each subsequent Distribution Date until such Class A-3FX Interest Shortfall

is fully paid, an additional amount (“Class A-3FX Additional Interest”)

equal to the product of (i) a fraction, the numerator of which is 30 and the

denominator of which is 360, times (ii) the Class A-3FX Note Interest Rate in

effect with respect to the related Interest Period times (iii) such Class A-3FX

Interest Shortfall (or the portion thereof which has not been paid to the Class

A-3FX Noteholders) shall be payable as provided herein with respect to the

Class A-3FX Notes.  Notwithstanding

anything to the contrary herein, Class A-3FX Additional Interest shall be

 

25

 

payable or distributed to the Class A-3FX Noteholders only to the

extent permitted by applicable law.

 

(d)  The amount

of monthly interest distributable from the Collection Account with respect to

the Class A-4FL Notes pursuant to Section 4.05(a)(vi) on any Distribution Date

(“Class

A-4FL Monthly Interest”) shall be an amount equal to the product

of (i) a fraction, the numerator of which is the actual number of days in the

related Interest Period and the denominator of which is 360 and (ii) the Class

A-4FL Note Interest Rate in effect with respect to the related Interest Period

and (iii) the Class A-4FL Invested Amount 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-4FL Initial Invested Amount).  The holders of the Class A-4FL Notes will

also be entitled to receive distributions in respect of interest on each

Distribution Date as provided in Section 4.05(a)(xi).

 

The amount of monthly interest distributable from the

Collection Account with respect to the Class A-4FX Notes pursuant to Section

4.05(a)(vi) on any Distribution Date (“Class A-4FX Monthly Interest”) shall be

an amount equal to the product of (i) a fraction, the numerator of which is 30

(except for the first Interest Period, when the numerator will be 22) and the

denominator of which is 360, (ii) the Class A-4FX Note Interest Rate in effect

with respect to the related Interest Period and (iii) the Class A-4FX Invested

Amount 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-4FX

Initial Invested Amount).  The holders

of the Class A-4FX Notes will also be entitled to receive distributions in

respect of interest on each Distribution Date as provided in Section

4.05(a)(xi).

 

On the Determination Date preceding each Distribution

Date, the Servicer shall determine the excess, if any (the “Class

A-4FL Interest Shortfall”), of (x) the Class A-4FL Monthly

Interest for such Distribution Date over (y) the aggregate amount of funds

allocated and available to pay such Class A-4FL Monthly Interest on such

Distribution Date.  If the Class A-4FL

Interest Shortfall with respect to any Distribution Date is greater than zero,

on each subsequent Distribution Date until such Class A-4FL Interest Shortfall

is fully paid, an additional amount (“Class A-4FL Additional Interest”)

equal to the product of (i) a fraction, the numerator of which is the actual

number of days in the related Interest Period and the denominator of which is

360, times (ii) the Class A-4FL Note Interest Rate in effect with respect to

the related Interest Period times (iii) such Class A-4FL Interest Shortfall (or

the portion thereof which has not been paid to the Class A-4FL Noteholders)

shall be payable as provided herein with respect to the Class A-4FL Notes.  Notwithstanding anything to the contrary

herein, Class A-4FL Additional Interest shall be payable or distributed to the

Class A-4FL Noteholders only to the extent permitted by applicable law.

 

On the Determination Date preceding each Distribution

Date, the Servicer shall determine the excess, if any (the “Class A-4FX

Interest Shortfall”), of (x) the Class A-4FX Monthly Interest

for such Distribution Date over (y) the aggregate amount of funds

allocated and available to pay such Class A-4FX Monthly Interest on such

Distribution Date.  If the Class A-4FX

Interest Shortfall with respect to any Distribution Date is greater than zero,

on each subsequent Distribution Date until such Class A-4FX Interest Shortfall

is fully paid, an additional amount (“Class A-4FX Additional Interest”)

equal to the product of (i) a fraction,

 

26

 

the numerator of which is 30 and the denominator of which is 360, times

(ii) the Class A-4FX Note Interest Rate in effect with respect to the related

Interest Period times (iii) such Class A-4FX Interest Shortfall (or the portion

thereof which has not been paid to the Class A-4FX Noteholders) shall be

payable as provided herein with respect to the Class A-4FX Notes.  Notwithstanding anything to the contrary herein,

Class A-4FX Additional Interest shall be payable or distributed to the Class

A-4FX Noteholders only to the extent permitted by applicable law.

 

(e) The amount of monthly interest distributable from

the Collection Account with respect to the Class B Notes pursuant to Section

4.05(a)(xiii) on any Distribution Date (“Class B Monthly Interest”) shall be an

amount equal to the product of (i) a fraction, the numerator of which is the

actual number of days in the related Interest Period and the denominator of

which is 360, (ii) the Class B Note Interest Rate in effect with respect to the

related Interest Period and (iii) the Class B Invested Amount 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 Initial Invested Amount).

 

Section 4.03.          Daily

Application of Collections.  The Servicer shall with respect to each Business Day in a Monthly

Period during the Reinvestment Period, Special Reinvestment Period and Partial

Reinvestment Period distribute Allocable Principal Collections and Allocable

Finance Charge Collections on deposit in the Collection Account on such

Business Day as follows:

 

(i)  to the

Transferor, an amount equal to the product of (1) the Floating Allocation

Percentage and (2) the sum of (A) the amount of all newly created Principal

Receivables, other than Non-Conforming Terms Change Receivables, which are

required to be funded on such Business Day plus (B) the amount of all Principal

Receivables created on a prior Business Day during such Monthly Period which

were not funded for any reason other than that such Principal Receivables were

Non-Conforming Terms Change Receivables; and

 

(ii)  to the

holder of the Variable Funding Notes, an amount equal to the product of (a) the

Floating Allocation Percentage and (b) the aggregate amount of Increase Amounts

(as such term is defined in the Indenture Supplement relating to the Variable

Funding Notes) that were funded during such Monthly Period and have not been

previously reimbursed pursuant to this Section 4.03(ii) or Section 4.03(ii) of

the Indenture Supplement relating to the Variable Funding Notes during such

Monthly Period;

 

provided,

however, that (i) daily releases of Collections of Principal

Receivables and Finance Charge Receivables under this Section 4.03 will be

permitted on or after the 15th day of any Monthly Period only if the

Servicer determines that on any day on or after the 15th day of such

Monthly Period, the Note Administrator, on behalf of the Indenture Trustee, has

on deposit in the Collection Account Collections of Finance Charge Receivables

and Principal Receivables in an amount sufficient to pay the percentage

specified in Schedule I hereto for such day of the Estimated Required Coverage

Amount due on the related Distribution Date and (ii) daily releases of

Collections of Finance Charge Receivables under this Section 4.03 will be

permitted on or after the 10th day of any Monthly Period only if the

Servicer determines that on any day on or after the 10th day of such

Monthly Period, the Note Administrator, on behalf of the Indenture

 

27

 

Trustee, has on deposit Collections of Finance Charge

Receivables and Principal Receivables in an amount sufficient to pay 100% of

the Estimated Required Coverage Amount due on the related Distribution Date; provided

further that notwithstanding any provision to the contrary herein,

during each Monthly Period during the Partial Reinvestment Period, the

aggregate daily releases of Collections of Principal Receivables and Finance

Charge Receivables under this Section 4.03 shall not exceed 0.5% of the

Invested Amount on the last day of the prior Monthly Period and provided

further that no amounts will distributed to the Transferor under this Section

4.03 if after giving effect thereto the Transferor Amount  would be less than zero.

 

Section 4.04.          Required

Coverage Amount. 

With respect to each Distribution Date, the Note Administrator shall

determine, based on the information provided to it by the Servicer no later than

the Determination Date, the amount (the “Required Coverage

Amount”), if any, by which (x) the sum of the Program

Expenses, Monthly Servicing Fee, Class A-1FL Monthly Interest, Class A-1FX

Monthly Interest, Class A-2FL Monthly Interest, Class A-2FX Monthly Interest,

Class A-3FL Monthly Interest, Class A-3FX Monthly Interest, Class A-4FL Monthly

Interest, Class A-4FX Monthly Interest and Class B Monthly Interest for such

Distribution Date exceeds (y) the Allocable Finance Charge Collections for

such Distribution Date available to pay such amounts.

 

Section 4.05.          Application

of Available Finance Charge Collections and Available Principal Collections.  (a) The Note Administrator shall apply,

based on the information provided to it by the Servicer no later than the

Determination Date, Available Finance Charge Collections with respect to each

Monthly Period in the following order or priority:

 

(i)          an amount equal to the Program

Expenses for the related Distribution Date shall be distributed to the

Indenture Trustee, Note Administrator, Certificate Administrator, and

Certificate Trustee, as applicable, on the related Distribution Date;

 

(ii)         an amount equal to the Monthly

Servicing Fee for the related Distribution Date plus the amount of any

Monthly Servicing Fee previously due but not distributed to the Servicer on a

prior Distribution Date, shall be distributed to the Servicer on the related

Distribution Date;

 

(iii)        an amount equal to Class A-1FL

Cumulative Monthly Interest and Class A-1FX Cumulative Monthly Interest shall

be distributed to the Note Administrator for payment on the related

Distribution Date to the Class A-1FL Noteholders and the Class A-1FX

Noteholders, respectively, pro rata based on the dollar amount due on

the related Distribution Date;

 

(iv)       an amount equal to Class A-2FL Cumulative

Monthly Interest and Class A-2FX Cumulative Monthly Interest shall be

distributed to the Note Administrator for payment on the related Distribution

Date to the Class A-2FL Noteholders and the Class A-2FX Noteholders,

respectively, pro rata based on the dollar amount due on the related

Distribution Date;

 

 

28

 

(v)        an amount equal to Class A-3FL

Cumulative Monthly Interest and Class A-3FX Cumulative Monthly Interest shall

be distributed to the Note Administrator for payment on the related

Distribution Date to the Class A-3FL Noteholders and the Class A-3FX

Noteholders, respectively, pro rata based on the dollar amount due on

the related Distribution Date;

 

(vi)       an amount equal to Class A-4FL Cumulative

Monthly Interest and Class A-4FX Cumulative Monthly Interest shall be

distributed to the Note Administrator for payment on the related Distribution

Date to the Class A-4FL Noteholders and the Class A-4FX Noteholders, respectively,

pro rata

based on the dollar amount due on the related Distribution Date;

 

(vii)      from Available Finance Charge Collections

other than Reallocated Principal Collections, an amount equal to the Class A

Investor Default Amount for the related Distribution Date shall be treated as

Available Principal Collections for such Monthly Period and applied pursuant to

clause (b) hereof;

 

(viii)     from Available Finance Charge Collections

other than Reallocated Principal Collections, an amount equal to Class A-1FL Cumulative

Subordinated Interest and Class A-1FX Cumulative Subordinated Interest shall be

distributed to the Note Administrator for payment on the related Distribution

Date to the Class A-1FL Noteholders and the Class A-1FX Noteholders,

respectively, pro rata based on the dollar amount due on the related

Distribution Date;

 

(ix)        from Available Finance Charge

Collections other than Reallocated Principal Collections, an amount equal to

Class A-2FL Cumulative Subordinated Interest and Class A-2FX Cumulative Subordinated

Interest shall be distributed to the Note Administrator for payment on the

related Distribution Date to the Class A-2FL Noteholders and the Class A-2FX

Noteholders, respectively, pro rata based on the dollar amount due on

the related Distribution Date;

 

(x)         from Available Finance Charge

Collections other than Reallocated Principal Collections, an amount equal to

Class A-3FL Cumulative Subordinated Interest and Class A-3FX Cumulative

Subordinated Interest shall be distributed to the Note Administrator for

payment on the related Distribution Date to the Class A-3FL Noteholders and the

Class A-3FX Noteholders, respectively, pro rata based on the dollar amount due on

the related Distribution Date;

 

(xi)        from Available Finance Charge

Collections other than Reallocated Principal Collections, an amount equal to

Class A-4FL Cumulative Subordinated Interest and Class A-4FX Cumulative

Subordinated Interest shall be distributed to the Note Administrator for

payment on the related Distribution Date to the Class A-4FL Noteholders and the

Class A-4FX Noteholders, respectively, pro rata based on the dollar amount due on

the related Distribution Date;

 

(xii)       from Available Finance Charge Collections

other than Reallocated Principal Collections, an amount equal to the Class A

Investor Charge-Offs which have

 

29

 

not been previously

reimbursed shall be treated as a portion of Available Principal Collections for

the related Distribution Date and shall be applied pursuant to clause (b)

hereof;

 

(xiii)      an amount equal to Class B Monthly

Interest for the related Distribution Date shall be distributed to the Note

Administrator for payment on the related Distribution Date to Class B

Noteholders on the related Distribution Date;

 

(xiv)      an amount equal to the Class B Investor

Default Amount shall be treated as Available Principal Collections for such

Monthly Period and shall be applied pursuant to clause (b) hereof;

 

(xv)       an amount equal to the Class B Investor

Charge-Offs which have not been previously reimbursed shall be treated as

Available Principal Collections for such Monthly Period and shall be applied

pursuant to clause (b) hereof;

 

(xvi)      an amount equal to the O/C Investor

Default Amount shall be treated as Available Principal Collections for such

Monthly Period and shall be applied pursuant to Clause (b) hereof;

 

(xvii)     an amount equal to the O/C Investor

Charge-Offs which have not been previously reimbursed shall be treated as

Available Principal Collections for such Monthly Period and shall be applied

pursuant to clause (b) hereof; and

 

(xviii)    the balance, if any, shall be treated as

Available Principal Collections.

 

(b)   The Note Administrator shall apply, based on

the information provided to it by the Servicer received no later than the

Determination Date, Available Principal Collections with respect to each

related Monthly Period in the following order of priority:

 

(i)            Subject to Section 4.03, an amount

equal to the Required Coverage Amount shall be distributed on the related

Distribution Date by the Note Administrator to fund the Required Coverage

Amount, if any, in the priority set forth in subsections 4.05(a)(i) through

(vi) and (xiii);

 

(ii)           during the Reinvestment Period, the

Special Reinvestment Period and the Partial Reinvestment Period, to purchase

new Receivables from the Transferor during such Monthly Period or to pay down

draws on the Variable Funding Notes during such Monthly Period; provided,

however, that during the Partial Reinvestment Period, the amount applied

under this subclause (b)(ii) shall not exceed 0.5% of the aggregate amount of

the Invested Amount with respect to such Monthly Period;

 

(iii)          (a) during the Reinvestment Period,

(1) from Available Principal Collections for the related Monthly Period less an

amount equal to Discounted Recoveries, principal shall be paid on the related

Distribution Date pro rata to the holders of the Class A-1 Notes, the Class

A-2 Notes, the Class A-3 Notes, the Class A-4 Notes, the Class B Notes and the

O/C Holder based on the Invested Amount of each as of the end of the prior

Monthly Period until the Principal Balance of each such class or, with

 

30

 

respect to the O/C

Holder, the O/C Invested Amount, is paid in full and (2) from Available

Principal Collections for the related Monthly Period equal to Discounted

Recoveries, principal shall be paid on the related Distribution Date pro rata

to the holders of the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes

and the Class A-4 Notes until the Principal Balance of each such class and then

to the holders of the Class B Notes until the Class B Principal Balance is paid

in full and then to the O/C Holder until the O/C Invested Amount is paid in

full; (b) during the Scheduled Amortization Period, the Special Reinvestment

Period and the Partial Reinvestment Period, principal will be paid on the

related Distribution Date first to the holders of the Class A Notes (pro rata

among the Class A-1 Notes, the Class A-2 Notes, the Class A-3 Notes and the

Class A-4 Notes) until the Principal Balance of the Class A Notes is paid in

full, then to the Class B Notes until the Principal Balance of the Class B

Notes is paid in full, then to the O/C Holder, until the O/C Invested Amount is

paid in full and (c) during the Rapid Amortization Period, principal shall be

paid on the related Distribution Date to the holders of the Class A-1 Notes

until the Principal Balance of the Class A-1 Notes is paid in full, then to the

holders of the Class A-2 Notes until the Principal Balance of the Class A-2

Notes is paid in full, then to the holders of the Class A-3 Notes until the

Principal Balance of the Class A-3 Notes is paid in full, then to the holders

of the Class A-4 Notes until the Principal Balance of the Class A-4 Notes is

paid in full, then to the holders of the Class B Notes until the Principal

Balance of the Class B Notes is paid in full and then to the O/C Holder until

the O/C Invested Amount is paid in full;

 

(iv)          an amount equal to any Excess Program

Expenses for such Distribution Date shall be distributed on the related

Distribution Date to the Indenture Trustee, Note Administrator, Certificate

Administrator, and Certificate Trustee, as applicable; and

 

(v)           an amount equal to the Principal

Shortfalls for all outstanding Series shall be treated as Shared Principal

Collections and applied in accordance with Section 8.05 of the Indenture;

 

(vi)          the balance of such Available

Principal Collections shall be paid to the O/C Holder.

 

On each Distribution Date, the holders of the Class B

Notes shall be entitled to receive from amounts otherwise payable to the O/C

Holder on such Distribution Date an additional amount equal to Class B Monthly

Interest for such Distribution Date calculated without taking into account the

Class B Note Interest Rate Cap, to the extent not paid pursuant to clause

(xiii) of Section 4.05(a), and such amount shall be distributed by the Note

Administrator for payment to the Class B Noteholders on such Distribution Date.

 

On each Distribution Date, an amount equal to the

Special VFN Allocation will be applied to pay principal first to the holders of

the Class A-1 Notes, then to the holders of the Class A-2 Notes and then to the

holders of the Class A-3 Notes until, together with amounts paid pursuant to

clause (iii) of Section 4.05(b), the Principal Balance of each such class is

paid in full, and such amount shall be distributed by the Note Administrator

for payment to the applicable holders on such Distribution Date.

 

31

 

Section 4.06.          Defaulted

Amounts; Investor Charge-Offs.  (a) 

On each Determination Date, the Note Administrator shall calculate the

Investor Default Amount, if any, for the related Distribution Date.  If, on any Distribution Date, the Investor

Default Amount for the related Monthly Period exceeds the amount of Allocable

Finance Charge Collections available to be distributed pursuant to Section

4.05(a)(vii), (xiv) and (xvi) with respect to such Monthly Period, the Invested

Amount shall be reduced by the amount of such excess, but not by more than the

Investor Default Amount for such Distribution Date (together with the amounts

described in the next sentence, an “Investor Charge-Off”).  Investor Charge-Offs will also include, and

the Invested Amount shall be reduced by the amount of, Reallocated Principal

Collections and any Series Post Payment Adjustment Amount (if such amount is

negative).

 

(b)  Investor Charge-Offs will first be applied

to reduce the O/C Invested Amount. If such reduction would cause the O/C

Invested Amount to be a negative number, the O/C Invested Amount will be

reduced to zero and the Class B Invested Amount shall be reduced by the amount

by which the O/C Invested Amount would have been reduced below zero.

 

(c)  If such reduction of the Class B Invested

Amount would cause the Class B Invested Amount to be a negative number, the

Class B Invested Amount will be reduced to zero and the Class A-4 Invested

Amount shall be reduced by the amount by which the Class B Invested Amount

would have been reduced below zero.

 

(d)  If such reduction of the Class A-4 Invested

Amount would cause the Class A-4 Invested Amount to be a negative number, the

Class A-4 Invested Amount will be reduced to zero and the Class A-3 Invested

Amount shall be reduced by the amount by which the Class A-4 Invested Amount

would have been reduced below zero.

 

(e)  If such reduction of the Class A-3 Invested

Amount would cause the Class A-3 Invested Amount to be a negative number, the

Class A-3 Invested Amount will be reduced to zero and the Class A-2 Invested

Amount shall be reduced by the amount by which the Class A-3 Invested Amount

would have been reduced below zero.

 

(f)  If such reduction of the Class A-2 Invested

Amount would cause the Class A-2 Invested Amount to be a negative number, the

Class A-2 Invested Amount will be reduced to zero and the Class A-1 Invested

Amount shall be reduced by the amount by which the Class A-2 Invested Amount

would have been reduced below zero.

 

(g)  The Invested Amount shall be increased on

any Distribution Date by (i) the amount of Allocable Finance Charge Collections

with respect to the related Monthly Period which are allocated and available

for that purpose pursuant to Section 4.05(a)(xii), (xv) and (xvii) and (ii) by

the Series Post Payment Adjustment Amount with respect to such Distribution

Date (if such amount is positive).  Such

increases of the Invested Amount shall be applied to increase the Class A-1 Invested

Amount, Class A-2 Invested Amount, Class A-3 Invested Amount, Class A-4

Invested Amount, Class B Invested Amount and O/C Invested Amount, in that

order, in each case up to the amount of all prior Investor Charge-Offs for such

Class; provided

that the O/C Invested Amount may be increased by the full amount of any Series

Post Payment Adjustment Amount applied to increase the O/C Invested Amount.

 

32

 

(h)  The

Invested Amount for each class of Class A Notes will be increased or decreased pro rata

with respect to each of the fixed rate notes and floating rate notes of the

same class.

 

Section 4.07.          [Reserved].

 

Section 4.08.          Shared

Principal Collections. 

Subject to Section 8.05 of the Indenture, Shared Principal Collections

for any Distribution Date will be allocated to Series 2002-1 in an amount equal

to the product of (x) the aggregate amount of Shared Principal Collections

with respect to all Principal Sharing Series for such Distribution Date and

(y) a fraction, the numerator of which is the Principal Shortfall for such

Distribution Date and the denominator of which is the aggregate amount of

Principal Shortfalls for all the Series which are Principal Sharing Series for

such Distribution Date.  The “Principal

Shortfall” for any Distribution Date will be equal to the

Invested Amount after the application of all Collections other than Shared

Principal Collections on such Distribution Date.

 

Section 4.09.          Determination

of LIBOR.

 

(a)  On each

LIBOR Determination Date, the Note Administrator shall determine LIBOR (“LIBOR”)

on the basis of the rate for deposits in United States dollars for a one-month

period which appears on Telerate Page 3750 as of 11:00 a.m., London time, on

such date.  If such rate does not appear

on Telerate Page 3750, the rate for that LIBOR Determination Date shall be

determined on the basis of the rates at which deposits in United States dollars

are offered by at least two major banks, selected by the Servicer, at

approximately 11:00 a.m., London time, on that day to prime banks in the London

interbank market for a one-month period. 

The Note Administrator shall request the principal London office of each

of such two major banks to provide a quotation of its rate.  If at least two (2) such quotations are

provided, the rate for that LIBOR Determination Date shall be the arithmetic

mean of the quotations.  If fewer than

two quotations are provided as requested, the rate for that LIBOR Determination

Date will be the arithmetic mean of the rates quoted by major banks in New York

City, selected by the Servicer, at approximately 11:00 a.m., New York City

time, on that day for loans in United States dollars to leading European banks

for a one-month period.

 

(b)           On

each LIBOR Determination Date, the Note Administrator shall notify the Servicer

of the LIBOR rate for the following Interest Period.

 

[END OF ARTICLE IV ]

 

33

 

ARTICLE V

 

Delivery of Series 2002-1 Notes;

Distributions; Reports to

Series 2002-1 Noteholders

 

Section 5.01.         Delivery

and Payment for the Series 2002-1 Notes.

 

The Issuer shall execute and issue, and the Indenture

Trustee shall authenticate, the Series 2002-1 Notes and the O/C Certificate in

accordance with Section 2.03 of the Indenture. 

The Note Administrator shall deliver the Series 2002-1 Notes to or upon

the order of the Issuer when so authenticated.

 

Section 5.02.          Distributions.

 

(a)  On each

Distribution Date, the Note Administrator shall distribute to the Series 2002-1

Noteholders of record on the preceding Record Date (other than as provided in

Section 11.02 of the Indenture), such Noteholders’ pro rata share of the

amounts held by the Note Administrator that are allocated and available on such

Distribution Date to pay interest on the related class of Notes pursuant to

this Indenture Supplement.

 

(b)  On each

Distribution Date, the Note Administrator shall distribute to the Series 2002-1

Noteholders of record on the preceding Record Date (other than as provided in

Section 11.02 of the Indenture) or to the O/C Holder, as applicable, such

Noteholders’ or O/C Holders’ pro rata share of the amounts held by the Note

Administrator that are allocated and available on such Distribution Date to pay

principal on the related class of Notes or the O/C Invested Amount, as applicable,

pursuant to this Indenture Supplement up to a maximum amount on any such date

equal to the Class A-1 Principal Balance, the Class A-2 Principal Balance, the

Class A-3 Principal Balance, the Class A-4 Principal Balance, the Class B

Principal Balance or the O/C Invested Amount, as applicable.

 

(c)  The

distributions to be made pursuant to this Section 5.02 are subject to the

provisions of Sections 2.06, 6.01 and 7.01 of the Transfer and Servicing

Agreement, Section 11.02 of the Indenture and Section 7.01 of this

Indenture Supplement.

 

(d)  Except as

provided in Section 11.02 of the Indenture with respect to a final

distribution, distributions to Series 2002-1 Noteholders and the O/C Holder

hereunder shall be made by (i) wire transfer in immediately available

funds and (ii) without presentation or surrender of any Series 2002-1 Note

or the O/C Certificate or the making of any notation thereon.

 

Section 5.03.          Reports

and Statements to Series 2002-1 Noteholders.

 

(a)  On each

Determination Date, the Servicer will provide to the Note Administrator the

information (in electronic format acceptable to the Note Administrator)

necessary for the Note Administrator to prepare, based on such written

information, and provide to the Rating Agencies on each Distribution Date,

statements, substantially in the form of Exhibit B hereto (each, a “Statement

to Noteholders”), setting forth certain information relating to

the Trust and Series 2002-1.

 

34

 

(b)  On or

before January 31 of each calendar year, beginning with calendar year 2003, the

Note Administrator shall furnish or cause to be furnished to each Person who at

any time during the preceding calendar year was a Series 2002-1 Noteholder or

O/C Holder, a statement prepared by the Note Administrator containing the

information which is required to be contained in the statement to Series 2002-1

Noteholders and the O/C Holder as set forth in paragraph (a) above, aggregated

for such calendar year or the applicable portion thereof during which such

Person was a Series 2002-1 Noteholder or O/C Holder, together with other

information as is required to be provided by an issuer of indebtedness under

the Code (in the case of the Series 2002-1 Noteholders) and such other

customary information as is necessary to enable the Series 2002-1 Noteholders

or the O/C Holder to prepare their tax returns.  Such obligation of the Note Administrator 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.

 

[END OF ARTICLE V]

 

35

 

ARTICLE VI

 

Series 2002-1 Redemption

Events; Voting

 

Section 6.01.          Series

2002-1 Redemption Events.  If any one of the following events shall occur with respect to

Series 2002-1:

 

(a)  (i)  the occurrence of an Insolvency Event

relating to the Transferor, the Servicer or Providian (with respect to

Providian, only while Providian is acting as subservicer to the Servicer

pursuant to the Interim Subservicing Agreement); (ii) the Account Owner shall

cease, or become unable, for any reason, to transfer  Receivables to the Transferor as provided in the Receivables

Purchase  Agreement or the Transferor

shall cease, or become unable, for any reason, to transfer Receivables to the

Trust as provided in the Transfer and Servicing Agreement;  (iii) the Accounts Owner shall become

unable, for any reason, to  transfer

good title to the Receivables to the Transferor as provided in the Receivables

Purchase Agreement; (iv) the Transferor shall become unable, for any reason, to

transfer good title to the Receivables to the Trust as provided in the Transfer

and Servicing Agreement; or (v) the Accounts Owner shall cease to settle newly

generated Receivables under applicable VISA and MasterCard agreements;

 

(b)  the Trust

or the Transferor becomes an “investment company” within the meaning of the

Investment Company Act;

 

(c)  failure to

pay interest due to any of the Class A Notes or the Class B Notes within 5

Business Days of the applicable Distribution Date;

 

(d)  the

Transferor or the Servicer shall fail (i) to make any payment or deposit

required by the terms of the Transfer and Servicing Agreement, the Indenture or

this Indenture Supplement on or before the date occurring five Business Days

after the date such payment or deposit is required to be made therein or herein

or (ii) to observe or perform any other covenants or agreements of the

Transferor or the Servicer set forth in the Transfer and Servicing Agreement,

the Indenture or this Indenture Supplement, which failure has a material

adverse effect on any class of the Series 2002-1 Noteholders and which

continues unremedied for a period of 60 days after the date on which written

notice of such failure, requiring the same to be remedied, shall have been

given to the Transferor or the Servicer, as applicable, by the Indenture

Trustee, or to the Transferor or the Servicer, as applicable;

 

(e)  any

representation or warranty made by the Transferor, the Issuer or the Servicer

in the Transfer and Servicing Agreement shall prove to have been incorrect in

any material respect when made or when delivered and continues to be incorrect

in any material respect for a period of 60 days after the date on which written

notice of such failure, requiring the same to be remedied, shall have been

given to the Transferor, the Issuer or the Servicer, as applicable, by the

Indenture Trustee, or to the Transferor, the Servicer or the Issuer, as

applicable, and the Indenture Trustee or any Holder of the Series 2002-1 Notes,

and as a result of which the interests of any class of the Series 2002-1

Noteholders are materially and adversely affected for such period; provided,

however, that a Series 2002-1 Redemption Event pursuant to this Section

6.01(e) shall not be deemed to have occurred with respect to the Transferor and

the

 

36

 

Transfer and Servicing Agreement if the Accounts Owner 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;

 

(f)  a court of

competent jurisdiction shall issue a final non-appealable order to the effect

that the Indenture Trustee shall, for any reason, fail to have a valid and

perfected first priority security interest in the Receivables;

 

(g)  without

limiting any of the foregoing, the occurrence of an Event of Default with respect

to Series 2002-1 and acceleration of the maturity of the Series 2002-1 Notes in

accordance with Section 5.03 of the Indenture; or

 

(h)  the O/C

Principal Percentage is less than 22.0%; 

 

then, in the case of any event described in subparagraph (d) or (e) ,

after the applicable grace period, if any, set forth in such subparagraphs, the

Indenture Trustee may, and at the direction of the Holders of Series 2002-1

Notes evidencing more than 50% of the aggregate unpaid principal amount of

Series 2002-1 Notes shall, by notice then given in writing to the Transferor

and the Servicer, declare that a “Series Redemption Event” with respect to

Series 2002-1 (a “Series 2002-1 Redemption Event”) has

occurred as of the date of such notice, and, in the case of any event described

in subparagraph (a), (b), (c), (f), (g) or (h) a Series 2002-1 Redemption Event

shall occur without any notice or other action on the part of the Indenture

Trustee or the Series 2002-1 Noteholders immediately upon the occurrence of

such event.

 

Section 6.02.          Voting in Event of Default.  The requirement set forth in Section

5.05(a)(iii) of the Indenture that the Indenture Trustee obtain the consent of

66–2/3% of the Outstanding Amount of the Class A Notes prior to

exercising the foreclosure remedy of selling Receivables shall be deemed to be

met with respect to Series 2002-1 only if the holders of 66–2/3% of the

Outstanding Amount of each of the Class A-1 Notes, the Class A-2 Notes, the

Class A-3 Notes and the Class A-4 Notes so consents.

 

[END OF ARTICLE VI]

 

37

 

ARTICLE VII

 

Redemption of Series

2002-1 Notes; Final Distributions; Series Termination

 

Section 7.01.          Clean-up

Call; Redemption Event Issuance; Redemption upon Auction; Final Distributions.

 

(a)  On any day

occurring on or after the date on which the Invested Amount is reduced to 10%

or less of the Initial Invested Amount and it is determined that continued

servicing would be administratively burdensome, the Servicer shall have the

option to repurchase the Series 2002-1 Notes (a “Clean-up Call”) at a

purchase price equal to the Redemption Amount. 

The Servicer shall give the Note Administrator and the Indenture Trustee

at least thirty (30) days prior written notice of the date on which the

Servicer intends to exercise such optional redemption.

 

(b)  The Issuer shall redeem the Notes (a “Redemption

Event Issuance”) at a price equal to the Redemption Amount

within 90 days after the occurrence of a Redemption Event; provided, that (i) the Issuer

receives an amount at least equal to the Redemption Amount, the VFN Reduction

Amount and the Transferor Amount Reduction Amount, to the extent such

Transferor Amount Reduction Amount represents Receivables funded by the

Transferor other than Non-Conforming Terms Change Receivables, through the

issuance of a new series of Notes within 90 days of such Redemption Event; (ii)

issuance of such new series of notes complies with all relevant regulatory,

legal, tax and rating agency criteria, including the New Issuance procedures in

Section 2.11 of the Indenture and the criteria that the new notes would have

ratings from Moody’s and Standard and Poor’s that are equal to or higher than

the ratings on the Notes being redeemed; (iii) the relative sizes of the rated tranches

of the new notes will be the same as or as similar as possible to the relative

sizes of the Class A Notes and the Class B Notes; (iv) the new series of notes

provides that the reinvestment period for such notes will be scheduled to end

on the same date that the Reinvestment Period of the Series 2002-1 Notes is

scheduled to end; and (v) the interest rate structure on each new class of

notes (i.e., fixed or floating rate) will be the same as the interest rate

structure of the Class A Notes and Class B Notes.

 

(c)  The Issuer shall redeem the Notes (a “Redemption

upon Auction”) at a price equal to the Redemption Amount on the

July 2005 Distribution Date if (i) no Redemption Event has occurred on or prior

to such date and (ii) the Note Administrator, on behalf of the Indenture

Trustee, has received sufficient proceeds from an auction of the Receivables to

pay the Redemption Amount, the VFN Reduction Amount, the Transferor Amount

Reduction Amount and an amount, as certified to in writing by the Servicer, equal

to the amount retained in the capital account of CSG, LLC at the time that such

redemption is scheduled to occur (the “O/C Reduction Amount”).  During the 90-day period prior to the July

2005 Distribution Date, the Servicer shall solicit bids for the sale of the

Receivables for settlement on such Distribution Date.  The Note Administrator, on behalf of the Indenture Trustee, will

determine which bid is the highest cash purchase offer, and if the proceeds are

sufficient to pay the Redemption Amount, the VFN Reduction Amount, the

Transferor Amount Reduction Amount and the O/C Reduction Amount, the applicable

Servicer will facilitate the sale of the applicable Receivables to the highest

cash bidder. The Note Administrator will be entitled to obtain (at the expense

of the

 

38

 

Issuer) and rely on the determination of an investment

banking firm in connection with this determination. The Transferor, its

affiliates or agents may not participate or bid in the auction. If the Note

Administrator, on behalf of the Indenture Trustee, is not able to receive

sufficient proceeds, the Receivables will not be sold, and the Scheduled

Amortization Period will commence.

 

(d)  Not later than 9:00 a.m., New York City

time, on the day on which the Notes are to be redeemed pursuant to a Clean-up

Call, Redemption Event Issuance or Redemption upon Auction is to occur, the

Servicer shall deposit into the Collection Account in immediately available

funds the Redemption Amount, the VFN Reduction Amount, the Transferor Amount

Reduction Amount and the O/C Reduction Amount, as applicable.  Following such deposit into the Collection

Account in accordance with the foregoing, the Invested Amount for Series 2002-1

shall be reduced to zero and the Indenture Trustee shall release the

Noteholder’s security interest in the Receivables.  The Redemption Amount, the VFN Reduction Amount, the Transferor

Amount Reduction Amount and the O/C Reduction Amount shall be distributed as

set forth in subsection 7.01(e).

 

(e)  With respect to the Redemption Amount, the

VFN Reduction Amount, the Transferor Amount Reduction Amount and the O/C

Reduction Amount deposited into the Collection Account pursuant to Section

7.01(d), as applicable, the Note Administrator shall, in accordance with the

written direction of the Servicer, not later than 9:00 a.m., New York City

time, on the related Distribution Date, make deposits or distributions of the

following amounts (in each case, after giving effect to any deposits and distributions

otherwise to be made on such date) in immediately available funds:  (i) the Principal Balance and any accrued

and unpaid interest on the Principal Balance of the Class A-1 Notes will be

distributed to the Note Administrator for payment to the Class A-1 Noteholders,

(ii) the Principal Balance and any accrued and unpaid interest on the Principal

Balance of the Class A-2 Notes will be distributed to the Note Administrator

for payment to the Class A-2 Noteholders, (iii) the Principal Balance and any

accrued and unpaid interest on the Principal Balance of the Class A-3 Notes

will be distributed to the Note Administrator for payment to the Class A-3

Noteholders, (iv) the Principal Balance and any accrued and unpaid interest on

the Principal Balance of the Class A-4 Notes will be distributed to the Note

Administrator for payment to the Class A-4 Noteholders, (v) the Principal Balance and any accrued and unpaid interest

on the Principal Balance of the Class B Notes will be distributed to the Note

Administrator for payment to the Class B Noteholders; (vi) to pay any amounts

due but unpaid with respect to Program Expenses and Excess Program Expenses,

(vii) to pay any amounts due but unpaid with respect to the Monthly Servicing

Fee; (viii) with respect to a Redemption Event Issuance or Redemption upon

Auction, to pay to the holders of the Variable Funding Notes the Variable

Funding Amount and to the holder of the Transferor Amount the Transferor Amount

Reduction Amount; (ix) with respect to a Redemption Event Issuance or

Redemption upon Auction, to pay to the O/C Holder the O/C Reduction Amount, and

(x) any amounts remaining in the Collection Account to be distributed to the O/C Holder.

 

Notwithstanding anything

to the contrary in this Indenture Supplement, the Indenture or the Transfer and

Servicing Agreement, all amounts distributed to the Note Administrator pursuant

to subsection 7.01(e) for payment to the Series 2002-1 Noteholders shall be

deemed distributed in full to the Series 2002-1 Noteholders on the date on

which such funds

 

39

 

are distributed to the Note Administrator pursuant to

this Section 7.01 and shall be deemed to be a final distribution pursuant

to Section 11.02 of the Indenture.

 

Section 7.02.          Series

Termination.  On

the Final Maturity Date, the right of the Series 2002-1 Noteholders to receive

payments from the Issuer will be limited solely to the right to receive

payments pursuant to Section 5.05 of the Indenture.

 

[END OF ARTICLE VII]

 

40

 

ARTICLE VIII

 

Miscellaneous Provisions

 

Section 8.01.          Ratification

of Indenture.  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.

 

Section 8.02.          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 or facsimile, but all of which shall

constitute one and the same instrument.

 

Section 8.03.          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.

 

Section 8.04.          Private

Placement of Series 2002-1 Notes; Form of Delivery of Series 2002-1 Notes.

 

(a)   The Series 2002-1 Notes and the O/C

Certificate have not been registered under the Securities Act or any state

securities law.  No transfer of any

Series 2002-1 Note or the  O/C

Certificate shall be made except in accordance with the terms of this Indenture

Supplement  and either (i) pursuant

to an effective registration under the Securities Act and applicable state

securities or “blue sky” laws or (ii) in a transaction exempt from the

registration requirements of the Securities Act and applicable state securities

or “blue sky” laws, to (A) a person who the transferor reasonably believes

is a Qualified Institutional Buyer within the meaning thereof in Rule 144A

under the Securities Act that is aware that the resale or other transfer is

being made in reliance on Rule 144A, (2) a person who is an

accredited investor as defined in Rule 501(a) under the Securities Act or

(3) an institution which has such knowledge and experience in financial

and business matters as to be capable of evaluating the merits and risks of the

investment therein.  The Series 2002-1

Notes and the O/C Certificate shall bear legends to the effect set forth in Exhibit A-1FL

through Exhibit C. 

None of the Transferor, the Transfer Agent and Registrar, the Owner

Trustee, the Indenture Trustee or the Note Administrator is obligated to

register the Series 2002-1 Notes or the O/C Certificate under the Securities

Act or any other securities or “blue sky” law or to take any other action not

otherwise required under this Indenture Supplement, the Indenture or the

Transfer and Servicing Agreement to permit the transfer of Series 2002-1 Notes

or the O/C Certificate without registration or as described above.

 

(b)   The Series 2002-1 Notes shall be Definitive

Notes and shall be delivered as Registered Notes as provided in

Section 2.01 of the Indenture.

 

Section 8.05.          Successors

and Assigns.  This

Indenture Supplement shall be binding upon and inure to the benefit of the

parties hereto and their respective permitted

 

41

 

successors and assigns, except that the Issuer may not

assign or transfer any of its rights under this Indenture Supplement without

the prior written notice to each Rating Agency.

 

Section 8.06.          Transfer

of the Class B Notes and O/C Certificate.  Notwithstanding anything to the contrary in

this Indenture Supplement, no interest in the Class B Notes or the O/C

Certificate may be directly or indirectly sold, conveyed, assigned,

hypothecated, pledged, participated, exchanged or otherwise transferred (each a

“Transfer”)

except to a Person who is a “United States person” for United States federal

income tax purposes and only upon the prior delivery of a Tax Opinion to the

Indenture Trustee and the Note Administrator with to respect to such Transfer,

and any Transfer in violation of these requirements shall be null and void ab initio.

 

Section 8.07.          Limitation of Liability.  Notwithstanding any other provision herein

or elsewhere, this Indenture Supplement has been executed and delivered by

Wilmington Trust Company, not in its individual capacity, but solely in its

capacity as Owner Trustee of the Trust. 

In no event shall Wilmington Trust Company 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.

 

[END OF ARTICLE VIII]

 

[SIGNATURE PAGE FOLLOWS]

 

42

 

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.

 

	

   

  	

   

  	

   

  	

  CSGQ TRUST, as Issuer

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  By:

  	

  Wilmington Trust Company

  
	

   

  	

   

  	

   

  	

  not in its individual capacity, but solely as Owner

  Trustee

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  Name:

  
	

   

  	

   

  	

   

  	

  Title

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  U.S. BANK NATIONAL ASSOCIATION,

  
	

   

  	

   

  	

  as Indenture Trustee

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  Name:

  
	

   

  	

   

  	

   

  	

  Title

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

  CITIBANK, N.A.,

  
	

   

  	

   

  	

  as Note Administrator

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

  Name:

  
	

   

  	

   

  	

   

  	

  Title

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

  Acknowledged and Accepted:

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

  COMPUCREDIT CORPORATION,

  	

   

  	

   

  
	

  as Servicer

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

  By:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:

  	

   

  	

   

  
	

   

  	

  Title:

  	

   

  	

   

  
							

 

E-1

 

	

  PACCT, LLC,

  	

   

  	

   

  
	

  as Transferor

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

  [on behalf of Providian National Bank,

  	

   

  	

   

  
	

  managing member]

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

  By:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:

  	

   

  	

   

  
	

   

  	

  Title:

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

  CSG FUNDING, LLC,

  	

   

  	

   

  
	

  as O/C Holder

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

  [on behalf of CSG, LLC,

  	

   

  	

   

  
	

  managing member]

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  	

   

  
	

  By:

  	

   

  	

   

  	

   

  	

   

  
	

   

  	

  Name:

  	

   

  	

   

  
	

   

  	

  Title:

  	

   

  	

   

  

 

E-2

 

SCHEDULE I

 

 

	

  Day

  	

   

  	

  Target%

  	

   

  
	

  15

  	

   

  	

  85.00

  	

  %

  
	

  16

  	

   

  	

  86.50

  	

  %

  
	

  17

  	

   

  	

  88.00

  	

  %

  
	

  18

  	

   

  	

  89.50

  	

  %

  
	

  19

  	

   

  	

  91.00

  	

  %

  
	

  20

  	

   

  	

  92.50

  	

  %

  
	

  21

  	

   

  	

  94.00

  	

  %

  
	

  22

  	

   

  	

  95.50

  	

  %

  
	

  23

  	

   

  	

  97.00

  	

  %

  
	

  24

  	

   

  	

  98.50

  	

  %

  
	

  25

  	

   

  	

  100.00

  	

  %

  
	

  26

  	

   

  	

  100.00

  	

  %

  
	

  27

  	

   

  	

  100.00

  	

  %

  
	

  28

  	

   

  	

  100.00

  	

  %

  
	

  29

  	

   

  	

  100.00

  	

  %

  
	

  30

  	

   

  	

  100.00

  	

  %

  
	

  31

  	

   

  	

  100.00

  	

  %

  

 

S-1EXHIBIT

10.2(a)

 

EXECUTION

COPY

 

 

CSGQ

TRUST,

 

Issuer

 

CITIBANK,

N.A.

 

Note Administrator

 

and

 

U.S.

BANK NATIONAL ASSOCIATION

 

Indenture Trustee

 

 

SERIES

2002-A INDENTURE SUPPLEMENT, VARIABLE FUNDING NOTES

 

Dated as of June 25, 2002

 

 

 

TABLE OF

CONTENTS

 

	

  ARTICLE

  I

  	

  Creation of the

  Series 2002-A Notes

  
	

  Section 1.01.

  	

  Designation

  
	

  ARTICLE

  II

  	

  Definitions

  
	

  Section 2.01.

  	

  Definitions

  
	

  ARTICLE III

  	

  Servicing Fee

  
	

  Section 3.01.

  	

  Servicing

  Compensation

  
	

  ARTICLE

  IV

  	

  Rights of Series

  2002-A Noteholders  and Allocation and

  Application of Collections

  
	

  Section

  4.01.

  	

  Collections

  and Allocations

  
	

  Section 4.02.

  	

  Principal

  Balance Increases

  
	

  Section 4.03.

  	

  Daily Application of

  Collections; Reimbursement of Intra-Month Increase Amounts

  
	

  Section 4.04.

  	

  Required Coverage

  Amount

  
	

  Section 4.05.

  	

  Application of Available

  Finance Charge Collections and Available Principal Collections

  
	

  Section 4.06.

  	

  Defaulted Amounts;

  Investor Charge-Offs

  
	

  Section 4.07.

  	

  Determination of

  LIBOR

  
	

  Section

  4.08.

  	

  Shared

  Principal Collections

  
	

  ARTICLE

  V

  	

  Delivery of Series

  2002-A Notes; Distributions; Reports to Series 2002-A Noteholders

  
	

  Section 5.01.

  	

  Delivery and Payment

  for the Series 2002-A Notes

  
	

  Section 5.02.

  	

  Distributions

  
	

  Section 5.03.

  	

  Reports and

  Statements to Series 2002-A Noteholders

  
	

  ARTICLE

  VI

  	

  Series 2002-A Voting

  
	

  Section 6.01.

  	

  Voting in Event of

  Default

  
	

  ARTICLE VII

  	

  Redemption

  of Series 2002-A Notes; Final Distributions; Series Termination

  
	

  Section 7.01.

  	

  Clean-up Call; Redemption

  Event Issuance; Redemption upon Auction; Final Distributions

  
	

  ARTICLE VIII

  	

  Miscellaneous Provisions

  
	

  Section 8.01.

  	

  Ratification of Indenture

  
	

  Section 8.02.

  	

  Counterparts

  
	

  Section 8.03.

  	

  Governing Law

  
	

  Section 8.04.

  	

  Private Placement of

  Series 2002-A Notes; Form of Delivery of Series 2002-A Notes

  
	

  Section 8.05.

  	

  Successors and Assigns

  
	

  Section

  8.06.

  	

  [Reserved].

  
	

  Section 8.07.

  	

  Transfer of the

  Notes

  

 

i

 

	

  EXHIBITS

  	

   

  
	

  EXHIBIT A

  	

  FORM OF NOTE

  
	

   

  	

   

  
	

  EXHIBIT B

  	

  FORM OF STATEMENT TO

  NOTEHOLDERS

  

 

ii

 

An extra section break has been inserted above this paragraph. Do not

delete this section break if you plan to add text after the Table of

Contents/Authorities.  Deleting this

break will cause Table of Contents/Authorities headers and footers to appear on

any pages following the Table of Contents/Authorities.

 

 

SERIES 2002-A INDENTURE SUPPLEMENT, dated as of June

25, 2002 (this “Indenture Supplement”), between CSGQ

Trust, a business trust organized and existing under the laws of the State of

Delaware (herein, the “Issuer” or the “Trust”), U.S. Bank

National Association, a banking corporation organized and existing under the

laws of the State of New York, 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 June 25, 2002

(as amended to date, the “Indenture”) between the Issuer and the

Indenture Trustee (the Indenture, together with this Indenture Supplement, the

“Agreement”)

and Citibank, N.A., a national association, as note administrator (herein,

together with its successors in the trusts hereunder, called the “Note

Administrator”).

 

Pursuant to Section 2.11 of the Indenture, the

Transferor may direct 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 2002-A NOTES

 

Section 1.01.          Designation

 

(a)           There

is hereby created and designated a Series of Notes to be issued pursuant to the

Indenture and this Indenture Supplement to be known as “CSGQ Trust, Series

2002-A Variable Funding Notes” or the “Series 2002-A Notes.”  The Series 2002-A Notes shall be issued in a

single class.  The Series 2002-A Notes

shall be due and payable on the Final Maturity Date.  The Series 2002-A Notes shall be issued in minimum amounts of

$1.00.

 

(b)           Series

2002-A shall be a Principal Sharing Series. 

Series 2002-A shall not be subordinated to any other Series.

 

(c)           Notwithstanding

section 3.07 of the Transfer and

Servicing Agreement, the Issuer agrees, and

each Purchaser and the Transferor will be deemed to agree, to treat the Series

2002-A Notes for federal, state and local income and franchise tax purposes as

representing an equity interest in the assets of the Trust.

 

[END OF ARTICLE I]

 

 

ARTICLE II

 

DEFINITIONS

 

Section 2.01.          Definitions

 

(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.

 

“Allocable Finance Charge Collections” shall

mean an amount equal to, with respect to any Monthly Period, the product of

(i) the Floating Allocation Percentage and (ii) Collections of

Finance Charge Receivables for such Monthly Period.

 

“Allocable Principal Collections” shall mean an

amount equal to, with respect to any Monthly Period the product of (i) the

Fixed Allocation Percentage and (ii) Collections of Principal Receivables

for such Monthly Period.

 

“Available Finance Charge Collections” shall

mean with respect to any Monthly Period an amount equal to the sum of (a)

Allocable Finance Charge Collections for such Monthly Period plus

(b) Reallocated Principal Collections for such Monthly Period.

 

“Available Principal Collections” shall mean,

with respect to any Monthly Period, an amount equal to the sum of (a) the

Allocable Principal Collections for such Monthly Period, (b) any Shared

Principal Collections with respect to other Series that are allocated to Series

2002-A in accordance with Section 8.05 of the Indenture and Section 4.08

hereof and (c) any other amounts which pursuant to Section 4.05(a)(iii)

and (iv) hereof are to be treated as Available Principal Collections with

respect to the related Distribution Date.

 

“Clean-up Call” shall have the meaning

specified in subsection 7.01(a).

 

“Closing Date” shall mean June 25, 2002.

 

“Distribution Date” shall mean July 17, 2002

and the seventeenth day of each calendar month thereafter, or if such

seventeenth day is not a Business Day, the next succeeding Business Day.

 

“Final Maturity Date” shall mean the

Distribution Date occurring in June 2012.

 

“Fixed Allocation Percentage” shall mean an

amount equal to the percentage equivalent of a fraction, the numerator of which

is either (a) with respect to any Monthly Period during a rapid amortization

period with respect to the Issuer’s Series 2002-1 Notes, the Invested Amount as

of the close of business on the last day of the Monthly Period preceding the

commencement of the rapid amortization period with respect to the Issuer’s

Series 2002-1 Notes or (b) with respect to all other Monthly Periods, the

Invested Amount on the close of

 

2

 

business on the last day of the prior Monthly Period and the

denominator of which is the greater of (a) the aggregate amount of

Principal Receivables and Finance Charge Receivables as of the close of

business on the last day of the prior Monthly Period (or with respect to the

first Monthly Period, the aggregate amount of Principal Receivables and Finance

Charge Receivables as of the close of business on the Cut-Off Date) and

(b) the sum of the numerators used to calculate the allocation percentages

with respect to Principal Collections for all outstanding series on the date of

determination.

 

“Floating Allocation Percentage” shall mean an

amount equal to, with respect to any Monthly Period, the percentage equivalent

of a fraction, the numerator of which is the Invested Amount as of the last day

of the immediately preceding Monthly Period (or with respect to the first

Monthly Period, the initial Invested Amount) and the denominator of which is

the greater of (a) the aggregate amount of Principal Receivables and Finance

Charge Receivables as of the last day of the prior Monthly Period (or with

respect to the first Monthly Period, the aggregate amount of Principal

Receivables and Finance Charge Receivables as of the Cut-Off Date) and (b) the

sum of the numerators used to calculate the Floating Allocation Percentage for

all Series.

 

“Funding Event” shall mean the failure of the

Purchaser to fund a Net Purchase Requirement under Section 4.02 herein and in

the Note Purchase Agreement.

 

“Increase Amount” shall mean, on any Business

Day and with respect to a Note, the amount remitted by the related Purchaser to

fund an increase in the principal balance of such Note pursuant to Section

4.02(a).

 

“Increase Date” shall have the meaning

specified in subsection 4.02(a) of this Indenture Supplement.

 

“Initial Invested Amount” shall mean $0.

 

“Interest Period” shall mean, with respect to

any Distribution Date, the period from and including the Distribution Date

immediately preceding such Distribution Date (or, in the case of the first

Distribution Date, from and including the Closing Date) to but excluding such

Distribution Date.

 

“Invested Amount” shall mean, on any date of

determination, an amount equal to (a) the Initial Invested Amount plus (b)

the aggregate principal amount of Increase Amounts pursuant to Section 4.02 on

or prior to such date that were not reimbursed during the related Monthly

Period pursuant to Section 4.03(ii) minus (c) the aggregate amount of

principal payments made with respect to the Notes prior to such date pursuant

to Section 4.05(b)(ii) minus (d) the amount by which the Invested

Amount has been reduced on or prior to such date due to Investor Charge-Offs

pursuant to Section 4.06(a); plus (e) the amount by which the Invested

Amount has been increased on all prior Distribution Dates due to reimbursements

of Investor Charge-Offs pursuant to Section 4.06(b) plus the amount by which the

Invested Amount has been increased by the application of Series Post Payment

Adjustment Amounts (if such amount is positive) on all prior Distribution Dates

pursuant to Section 4.06(b); provided, however, that the Invested

Amount shall not be reduced below zero.

 

“Investor Charge-Offs” shall have the meaning

specified in Section 4.06.

 

3

 

“Investor Default Amount” shall mean, with

respect to any Monthly Period, an amount equal to the product of (a) the

Defaulted Amount for such Monthly Period and (b) the Floating Allocation

Percentage for such Monthly Period.

 

“LIBOR” shall have the meaning specified in Section 4.07.

 

“LIBOR Determination Date” shall mean (i) June

21, 2002 for the first Interest Period and (ii) the second London Business Day

prior to the commencement of the second and each subsequent Interest Period.

 

“London Business Day” shall mean any Business

Day on which dealings in deposits in United States dollars are transacted in

the London interbank market.

 

“Monthly Interest” shall mean an amount equal

to the product of (i) a fraction, the numerator of which is the actual number

of days in the related Interest Period and the denominator of which is 360,

(ii) the Note Interest Rate in effect with respect to the related Interest

Period and (iii) the 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 Initial Invested Amount).

 

“Monthly Servicing Fee” shall have the meaning

specified in Section 3.01.

 

“Net Purchase Requirement” shall mean with

respect to any Business Day (a) the purchase price for Principal Receivables

required to be paid by the Issuer to the Transferor with respect to such

Business Day minus (b) the amount of Collections of Receivables which are

allocable to any Series and available for the purchase of new Principal

Receivables with respect to such Business Day plus (c) the aggregate amount of

any Net Purchase Requirements which were not previously funded by the

Purchasers to the extent such amounts were not funded for reasons other than a

failure of a Secondary Purchaser to fund its obligations pursuant to this

Agreement or the Note Purchase Agreement.

 

“Non-Conforming Terms Change Receivables” shall

mean Receivables with respect to which (a) the Accounts Owner (i) fails to

implement a change requested by CSG, LLC under the Accounts Ownership Agreement

and (ii) fails to present documentation, within ten (10) Business Days after

receiving such request for an Account change, evidencing the rights of such

Accounts Owner to object to, and decline to implement, such change in

accordance with the terms of Section 2.02 of the Accounts Ownership Agreement,

and (b) the Servicer has notified the Purchaser and the Trust that CSG, LLC has

determined to suspend purchases rather than seek injunctive relief with respect

to such failure pursuant to such Section.

 

“Noteholder” shall mean the Person in whose

name a Note is registered in the Note Register.

 

“Note Interest Rate” shall mean a per annum

rate of 3.00% in excess of LIBOR as determined on the related LIBOR

Determination Date with respect to each Interest Period.

 

4

 

“Note Purchase Agreement” shall mean the Note

Purchase Agreement, dated as of June 25, 2002, among the Issuer, CSG, LLC, and

the Secondary Purchasers and the Purchaser, and all amendments thereto.

 

“Notes” shall mean any one of the Series 2002-A

Variable Funding Notes executed by the Issuer and authenticated by or on behalf

of the Indenture Trustee, substantially in the form of Exhibit A.

 

“Pre-Adjustment Invested Amount” shall mean on

each Distribution Date (a) the Invested Amount as of the end of the prior

Monthly Period minus (b) the amount by which the Investor Default Amount

exceeds the amount of Available Finance Charge Collections allocated to fund

such amount on such date minus (c) the amount of Reallocated Principal

Collections on such date minus (d) the amount of principal paid to reduce the

Invested Amount on such date plus (e) the amount of prior Investor Charge-Offs

to be reimbursed on such date.

 

“Pre-Adjustment Transferor Amount” shall mean

on each Distribution Date the Transferor Amount as of the end of the prior

Monthly Period minus all Defaulted Amounts and Collections allocated to the

Transferor Amount on the related Determination Date.

 

“Principal Balance” shall mean an amount equal

to (a) the initial Invested Amount plus (b) the aggregate amount of the

Increase Amounts of the Notes minus (c) all payments on the Notes

pursuant to Section 4.03(ii) and Section 4.05(b)(iii).

 

“Principal Shortfall” shall have the meaning

set forth in Section 4.08.

 

“Program Expenses” shall mean the product of (i)

the fees and certain expenses of the Indenture Trustee, the Note Administrator,

the Owner Trustee, the Certificate Administrator and the Certificate Trustee as

specified in each of the related fee agreements with each such party and

certain other program expenses, including any indemnity obligation of the

Issuer, and (ii) a fraction, the numerator of which is the Invested Amount as

of the last day of the immediately preceding Monthly Period (or with respect to

the first Monthly Period, the Initial Invested Amount) and the denominator of

which is the Invested Amount for Series 2002-1 and Series 2002-A.

 

“Purchasers” shall mean CSG, LLC, a Delaware

limited liability company, together with its successors and permitted assigns

and the Secondary Purchasers.

 

“Reallocated Principal Collections” shall mean,

with respect to any Distribution Date, the amount of Available Principal

Collections applied pursuant to Section 4.05(b)(i).

 

“Redemption Amount” shall mean with respect to

any day an amount equal to (a) with respect to a Clean-up Call or Redemption

upon Auction (i) the Principal Balance of the Notes plus any amounts due with

respect to Program Expenses which are due but unpaid plus any accrued unpaid

Monthly Servicing Fee (after giving effect to any deposits and distributions

otherwise to be made on such day if such day is a Distribution Date) plus

any Available Finance Charge Collections received prior to the effective date

of the related Clean-up Call, Redemption Event Issuance or Redemption upon

Auction, as applicable, in excess of the amount required to pay any due but

unpaid Program Expenses and Monthly Servicing Fee or (ii) such lesser amount

 

5

 

agreed to by the Noteholder or (b) with respect to a Redemption Event

Issuance, (i) the amount required to reduce the Principal Balance of the Notes

to zero or (ii) such lesser amount agreed to by the Noteholder other than with

respect to Program Expenses and any accrued unpaid Monthly Servicing Fee.

 

“Redemption Event Issuance” shall have the

meaning specified in Section 7.01(b).

 

“Redemption upon Auction” shall have the

meaning specified in Section 7.01(c).

 

“Required Coverage Amount” shall have the

meaning specified in Section 4.04.

 

“Reserve Account” shall have the meaning

specified in the Reserve Account Agreement.

 

“Reserve Account Agreement” shall mean the

Reserve Account Agreement dated as of June 25, 2002 between the Citibank, N.A.,

as Reserve Account Administrator and CSG, LLC.

 

“Secondary Purchaser” shall have the meaning

specified in the Note Purchase Agreement.

 

“Series 2002-A” shall mean the Series of Notes

the terms of which are specified in this Indenture Supplement.

 

“Series Post Payment Adjustment Amount” shall

mean an amount equal to the product of (i) (a) the Pre-Adjustment Invested

Amount relating to Series 2002-A divided by (b) the Pre-Adjustment Invested

Amounts for all outstanding Series and (ii) the Trust Post Payment Adjustment

Amount.

 

“Servicing Fee Rate” shall mean 5.00% per

annum.

 

“Shared Principal Collections” shall mean

Shared Principal Collections as defined and described in Section 8.05 of the

Indenture; and amounts to be treated as Shared Principal Collections under this

Supplement are described in Sections 4.05(b)(iv).

 

“Special VFN Allocation” shall mean on each

Distribution Date an amount equal to the amount required to pay, after

application of Section 4.05(b)(iii) of the Indenture Supplement relating to the

Issuer’s Series 2002-1 on such Distribution Date, the outstanding principal balance

of the Issuer’s Series 2002-1 Class A-1 Notes, Class A-2 Notes and Class A-3

Notes in full.

 

“Statement to Noteholders” shall have the

meaning specified in Section 5.03.

 

“Transfer” shall have the meaning set forth in

Section 8.07.

 

“Trust Post Payment Adjustment Amount” shall mean on each

Distribution Date an amount (which may be positive or negative) equal to (i)

the aggregate balance of Principal

 

6

 

Receivables and Finance Charge Receivables as of the

end of the prior Monthly Period minus (ii) the sum of (x) the

Pre-Adjustment Invested Amount for all Series and (y) the Pre-Adjustment

Transferor Amount

 

(b) Each capitalized term defined herein shall relate

to the Series 2002-A 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 the Indenture or the Transfer and Servicing

Agreement.  In the event that any term

or provision contained herein shall conflict with or be inconsistent with any

term or provision contained in the Indenture or the Transfer and Servicing

Agreement, the terms and provisions of this Indenture Supplement shall govern.

 

(c) The words “hereof,” “herein,” “hereunder” and

words of similar import when used in this Indenture Supplement shall refer to

this Indenture Supplement as a whole and not to any particular provision of

this Indenture Supplement; references to any Article, subsection, Section or

Exhibit are references to Articles, subsections, Sections and Exhibits in or to

this Indenture Supplement unless otherwise specified; and the term “including”

means “including without limitation.”

 

[END OF ARTICLE II]

 

7

 

ARTICLE III

 

SERVICING FEE

 

Section 3.01.          Servicing

Compensation.  The

share of the Servicing Fee allocable to the Series 2002-A Noteholders with

respect to any Distribution Date (the “Monthly Servicing Fee”) shall be equal

to one-twelfth (or, with respect to the first Distribution Date, 5/360) of the

product of (a) the Servicing Fee Rate, (b) the Floating Allocation

Percentage and (c)(i) the sum of (A) the amount of Principal Receivables and

Finance Charge Receivables on the first day of the Monthly Period preceding

such Distribution Date (or, with respect to the first Distribution Date, the

Closing Date) and (B) the amount of Principal Receivables and Finance Charge

Receivables on the last day of the Monthly Period preceding such Distribution

Date divided by (ii) two.

 

[END OF ARTICLE III]

 

8

 

ARTICLE IV

 

RIGHTS OF SERIES 2002-A NOTEHOLDERS

AND ALLOCATION AND APPLICATION OF COLLECTIONS

 

Section 4.01.          Collections

and Allocations.

 

(a) Allocations.  Prior to the close of business on each Deposit Date, Collections

of Finance Charge Receivables and Principal Receivables and Defaulted

Receivables allocated to Series 2002-A pursuant to Article VIII of the Indenture

shall be allocated and distributed as set forth in this Article.

 

(b) Allocations to the Series 2002-A Noteholders.  On each Deposit Date, the Servicer shall

allocate to the Series 2002-A Noteholders the following amounts as set forth

below:

 

(i)            Allocations of Finance Charge

Collections.  The Servicer shall

allocate to the Series 2002-A Noteholders and retain in the Collection Account

on each Deposit Date for application as provided herein an amount equal to the

product of (A) the Floating Allocation Percentage and (B) the aggregate amount

of Collections of Finance Charge Receivables received by the Servicer and

deposited to the Collection Account on such Deposit Date.

 

(ii)           Allocations of Principal

Collections.  The Servicer shall

allocate collections of Principal Receivables to the Series 2002-A Noteholders

as provided herein in an amount equal to the product of (i) the Fixed

Allocation Percentage and (ii) the aggregate amount of collections of

Principal Receivables received by the Servicer and deposited to the Collection

Account with respect to such Deposit Date.

 

Section 4.02.          Principal

Balance Increases

 

(a) The Series 2002-A Noteholders agree, by acceptance

of their Series 2002-A Notes, that the Servicer, acting on behalf of the Note

Administrator, shall, from time to time, request the Noteholders to fund

increases to the principal balance of their Notes on any Business Day (an “Increase Date”)

in an aggregate amount equal to the Net Purchase Requirement with respect to

such Business Day and the Noteholders hereby agree to fund such increases.  Each and every increase in the Principal

Balance shall, however, be subject to the terms, conditions and restrictions

set forth in the Note Purchase Agreement unless, with respect to any

Noteholder, such Noteholder has waived any such terms, conditions and

restrictions.  Any increase shall be

made in accordance with the following procedures:

 

(i)            No

later than 11:00 a.m. on any Business Day, the Note Administrator, upon receipt

of timely instructions from the Servicer, shall withdraw such amounts as are

available in the Reserve Account up to the Net Purchase Requirement for such

day and remit such amounts to the Transferor on such Increase Date.

 

9

 

(ii)           To

the extent additional funds are required to fund the Net Purchase Requirement

after giving effect to the amounts to be remitted pursuant to clause (i) above,

the Note Administrator upon receipt of instructions received no later than

11:00 a.m. on such Business Day from the Servicer shall notify CSG, LLC and the

Transferor of the amount of any additional funds that are required to fund the

Net Purchase Requirement.

 

(b) After giving effect to all remittances made by or

on behalf of any Purchaser (including any Secondary Purchaser) with respect to the

Net Purchase Requirement pursuant to Section 4.02(a) above, the Note

Administrator, on the written instruction of the Servicer in accordance with

the Note Purchase Agreement, shall promptly annotate the Note Register to

reflect the Increase Amount with respect to each Note.

 

Section 4.03.          Daily

Application of Collections; Reimbursement of

Intra-Month Increase Amounts.  The

Note Administrator, on the written instruction of the Servicer in accordance

with the Note Purchase Agreement, shall with respect to each Business Day in a

Monthly Period during the reinvestment period, special reinvestment period or

partial reinvestment period of the Issuer’s Series 2002-1 Notes distribute

Allocable Principal Collections and Allocable Finance Charge Collections on deposit

in the Collection Account on such Business Day in the following order of

priority:

 

(i)            to

the Transferor, an amount equal to the product of (1) the Floating Allocation

Percentage and (2) the sum of (A) the amount of all newly created Principal

Receivables, other than Non-Conforming Terms Change Receivables, which are

required to be funded on such Business Day plus (B) the amount of all Principal

Receivables created on a prior Business Day during such Monthly Period which

were not funded for any reason other than that such Principal Receivables were

Non-Conforming Terms Change Receivables; and

 

(ii)           to

the holders of the Notes, pro rata based on the outstanding principal balances

of the Notes, an amount equal to the product of (a) the Floating Allocation

Percentage and (b) aggregate amount of Increase Amounts that were funded during

such Monthly Period and have not previously been reimbursed pursuant to this

Section 4.03(ii) during such Monthly Period.

 

Section 4.04.          Required

Coverage Amount. 

With respect to each Distribution Date, the Note Administrator shall

determine, based on the information provided to it by the Servicer no later

than the Determination Date, the amount (the “Required Coverage Amount”),

if any, by which (x) the sum of the amounts required pursuant to

subsections 4.05(a)(i) and (ii) for such Distribution Date exceeds (y) the

Allocable Finance Charge Collections for such Distribution Date and available

to pay such amounts.

 

10

 

Section 4.05.          Application

of Available Finance Charge Collections and Available

Principal Collections.

 

(a) The Note

Administrator shall apply, based on the information provided to it by the

Servicer no later than the Determination Date, Available Finance Charge Collections

with respect to each related Monthly Period in the following order of priority:

 

(i)            an amount equal to the Program

Expenses for such Distribution Date plus the amount of any Program Expenses

previously due but not distributed on a prior Distribution Date shall be

distributed to the Indenture Trustee, Note Administrator, Certificate

Administrator, and Certificate Trustee, as applicable, on the related

Distribution Date;

 

(ii)           an amount equal to the Monthly

Servicing Fee for such Distribution Date plus the amount of any Monthly Servicing

Fee previously due but not distributed to the Servicer on a prior Distribution

Date, shall be distributed to the Servicer on the related Distribution Date;

 

(iii)          an amount equal to the Investor

Default Amount for such Distribution Date shall be treated as Available

Principal Collections for such Distribution Date and applied pursuant to clause

(b) hereof;

 

(iv)          an amount equal to the Investor

Charge-Offs with respect to the Notes which have not been previously reimbursed

shall be treated as a portion of Available Principal Collections for such

Distribution Date and shall be applied pursuant to clause (b) hereof;

 

(v)           an amount equal to Monthly Interest

shall be paid to the Noteholders on the related Distribution Date; and

 

(vi)          the balance, if any, shall be paid to

the Noteholders on the related Distribution Date.

 

(b) The Note

Administrator shall apply, based on the information provided to it by the

Servicer no later than the Determination Date, Available Principal Collections

with respect to each related Monthly Period in the following order or priority:

 

(i)            an amount equal to the Required

Coverage Amount shall be distributed on the related Distribution Date by the

Note Administrator to fund the Required Coverage Amount, if any, in the

priority set forth in subsections 4.05(a)(i) and (ii);

 

(ii)           if a Funding Event has occurred and

has not been cured, an amount equal to the Special VFN Allocation will be made

available to the Issuer’s Series 2002-1 and distributed on the related

Distribution Date in accordance with the applicable Indenture Supplement;

 

(iii)          an amount equal to the unpaid

Principal Balance shall be paid to the Noteholders on the related Distribution

Date until the Principal Balance has been paid in full; and

 

11

 

 

(iv)          an amount equal to the Principal

Shortfalls for all outstanding Series shall be treated as Shared Principal

Collections and applied in accordance with Section 8.05 of the Indenture;

and

 

(v)           the balance of such Available

Principal Collections shall be paid to the O/C Holder.

 

Section 4.06.          Defaulted

Amounts; Investor Charge-Offs.  (a) On each Determination Date, the Note

Administrator shall calculate the Investor Default Amount, if any, for the

related Distribution Date.  If, on any

Distribution Date, the Investor Default Amount for the related Monthly Period

exceeds the amount of Allocable Finance Charge Collections available to be

distributed pursuant to Section 4.05(a)(iii) with respect to such Monthly

Period, the Invested Amount shall be reduced by the amount of such excess, but

not by more than the Investor Default Amount for such Distribution Date

(together with the amounts described in the next sentence, an “Investor

Charge-Off”).  Investor

Charge-Offs will also include, and the Invested Amount shall be reduced by the

amount of, Reallocated Principal Collections and any Series Post Payment

Adjustment Amount (if such amount is negative).

 

(b)  The

Invested Amount shall be increased on any Distribution Date by the amount of

Allocable Finance Charge Collections with respect to the related Monthly Period

which are allocated and available for that purpose pursuant to Section

4.05(a)(iv) (but not by an amount in excess of the aggregate unreimbursed

Investor Charge-Offs) and by the Series Post Payment Adjustment Amount with

respect to such Distribution Date (if such amount is positive).

 

Section 4.07.          Determination

of LIBOR.

 

(a)  On each

LIBOR Determination Date, the Note Administrator shall determine LIBOR (“LIBOR”)

on the basis of the rate for deposits in United States dollars for a one-month

period which appears on Telerate Page 3750 as of 11:00 a.m., London time, on

such date.  If such rate does not appear

on Telerate Page 3750, the rate for that LIBOR Determination Date shall be

determined on the basis of the rates at which deposits in United States dollars

are offered by at least two major banks, selected by the Servicer, at

approximately 11:00 a.m., London time, on that day to prime banks in the London

interbank market for a one-month period. 

The Note Administrator shall request the principal London office of each

of such two major banks to provide a quotation of its rate.  If at least two (2) such quotations are

provided, the rate for that LIBOR Determination Date shall be the arithmetic

mean of the quotations.  If fewer than

two quotations are provided as requested, the rate for that LIBOR Determination

Date will be the arithmetic mean of the rates quoted by major banks in New York

City, selected by the Servicer, at approximately 11:00 a.m., New York City

time, on that day for loans in United States dollars to leading European banks

for a one-month period.

 

(b)  On each

LIBOR Determination Date, the Note Administrator shall notify the Servicer of

LIBOR for the following Interest Period.

 

Section 4.08.          Shared

Principal Collections. 

Subject to Section 8.05 of the Indenture, Shared Principal Collections

for any Distribution Date will be allocated to Series 2002-A in an amount equal

to the product of (x) the aggregate amount of Shared Principal

 

12

 

Collections with respect to all Principal Sharing Series for such

Distribution Date and (y) a fraction, the numerator of which is the

Principal Shortfall for such Distribution Date and the denominator of which is

the aggregate amount of Principal Shortfalls for all the Series which are

Principal Sharing Series for such Distribution Date.  The “Principal Shortfall” for any

Distribution Date will be equal to the Invested Amount after the application of

all Collections other than Shared Principal Collections on such Distribution

Date.

 

[END OF ARTICLE IV]

 

13

 

ARTICLE V

 

DELIVERY OF SERIES 2002-A NOTES;

DISTRIBUTIONS; REPORTS TO SERIES 2002-A NOTEHOLDERS

 

Section 5.01.          Delivery

and Payment for the Series 2002-A Notes.  The Issuer shall execute and issue, and the

Indenture Trustee shall authenticate, the Series 2002-A Notes in accordance

with Section 2.03 of the Indenture.  The

Note Administrator shall deliver the Series 2002-A Notes to or upon the order

of the Issuer when so authenticated.

 

Section 5.02.          Distributions

 

(a)  On each

Distribution Date, the Note Administrator shall distribute to the Series 2002-A

Noteholders of record on the preceding Record Date (other than as provided in

Section 11.02 of the Indenture), such Noteholders’ pro rata share of the

collections of Finance Charge Receivables held by the Note Administrator that

are allocated and available on such Distribution Date to be distributed to the

Noteholders pursuant to this Indenture Supplement.

 

(b)  On each

Distribution Date, the Note Administrator shall distribute to the Series 2002-A

Noteholders of record on the preceding Record Date (other than as provided in

Section 11.02 of the Indenture), such Noteholders’ pro rata share of the

amounts held by the Note Administrator that are allocated and available on such

Distribution Date to pay principal on the Notes pursuant to this Indenture Supplement

up to a maximum amount on any such date equal to the outstanding principal

balance on such date with respect to the Notes.

 

(c)  The

distributions to be made pursuant to this Section 5.02 are subject to the

provisions of Sections 2.06, 6.01 and 7.01 of the Transfer and Servicing

Agreement, Section 11.02 of the Indenture and Section 7.01 of this

Indenture Supplement.

 

(d)  Except as

provided in Section 11.02 of the Indenture with respect to a final

distribution, distributions to Series 2002-A Noteholders hereunder shall be

made by (i) wire transfer in immediately available funds and

(ii) without presentation or surrender of any Series 2002-A Note or the

making of any notation thereon.

 

Section 5.03.          Reports

and Statements to Series 2002-A Noteholders.

 

(a)  On each

Determination Date, the Servicer will provide to the Note Administrator the

information (in electronic format acceptable to the Note Administrator)

necessary for the Note Administrator to prepare, based on such written

information, and provide to the Rating Agencies on each Distribution Date,

statements, substantially in the form of Exhibit B hereto (each, a “Statement

to Noteholders”), setting forth certain information relating to

the Trust and Series 2002-1.

 

(b)  On or

before January 31 of each calendar year, beginning with calendar year 2003, the

Note Administrator shall prepare and furnish or cause to be furnished to each

Person who at any time during the preceding calendar year was a Series 2002-A

Noteholder, a statement containing the information which is required to be

contained in the statement to Series 2002-A 

 

14

 

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 2002-A Noteholder.

 

[END OF ARTICLE V]

 

15

 

ARTICLE VI

 

SERIES

2002-A VOTING

 

Section 6.01.          Voting

in Event of Default.  For purposes of the voting provisions set forth in Article V of

the Indenture, the Notes shall be deemed the Class A Notes of Series 2002-A.

 

[END OF ARTICLE VI]

 

16

 

ARTICLE VII

 

REDEMPTION OF SERIES 2002-A

NOTES; FINAL DISTRIBUTIONS;

SERIES

TERMINATION

 

Section 7.01.          Clean-up

Call; Redemption Event Issuance; Redemption upon

Auction; Final Distributions

 

(a)  On any day

occurring on or after the date on which the Invested Amount of the Notes is

reduced to 10% of the highest Invested Amount on any prior day and it is

determined that continued servicing would be administratively burdensome, the

Servicer shall have the option to repurchase the Series 2002-A Notes (a “Clean-up

Call”) at a purchase price equal to the Redemption Amount.  The Servicer shall give the Note

Administrator, the Indenture Trustee and the Note Purchaser at least thirty

(30) days prior written notice of the date on which the Servicer intends to

exercise such optional redemption.

 

(b)  The Issuer

shall pay to the Noteholders (a “Redemption Event Issuance”) an amount

equal to the Redemption Amount upon the occurrence of a Redemption Event

Issuance of the Issuer’s Series 2002-1 Notes.

 

(c)  The Issuer

shall redeem the Notes (a “Redemption upon Auction”) at a price

equal to the Redemption Amount upon the occurrence of a Redemption upon Auction

of the Issuer’s Series 2002-1 Notes.

 

(d)  Not later

than 9:00 a.m., New York City time, on the day on which a Clean-up Call,

Redemption Event Issuance or Redemption upon Auction, the Note Administrator

shall deposit into the Collection Account in immediately available funds the

Redemption Amount.  Any Clean-up Call,

Redemption Event Issuance or Redemption upon Auction is subject to payment in

full of the Redemption Amount. 

Following such deposit into the Collection Account in accordance with

the foregoing, the Invested Amount for Series 2002-A shall be reduced to zero

and the Series 2002-A Noteholders shall have no further security interest in

the Receivables.  The Redemption Amount

shall be distributed as set forth in subsection 7.01(e).

 

(e)  With

respect to the Redemption Amount deposited into the Collection Account pursuant

to Section 7.01(d), the Note Administrator shall, in accordance with the

written direction of the Servicer, on the related Distribution Date, make

deposits or distributions of the following amounts (in the priority set forth

below and, in each case, after giving effect to any deposits and distributions

otherwise to be made on such date) in immediately available funds:  the portion of the Redemption Amount

representing Available Finance Charge Collections received prior to the

effective date of the Clean-up Call, Redemption Event Issuance or Redemption

upon Auction, as applicable, but not previously distributed shall be applied

first to pay any amounts due but unpaid with respect to Program Expenses, then

to pay any amounts due but unpaid with respect to the Monthly Servicing Fee,

and then any remaining Available Finance Charge Collections shall be paid to

the Noteholders.

 

17

 

Notwithstanding anything to the contrary in this

Indenture Supplement, the Indenture or the Transfer and Servicing Agreement,

all amounts distributed to the Note Administrator pursuant to subsection

7.01(e) for payment to the Series 2002-A Noteholders shall be deemed

distributed in full to the Series 2002-A Noteholders on the date on which such

funds are distributed to the Note Administrator pursuant to this

Section 7.01 and shall be deemed to be a final distribution pursuant to

Section 11.02 of the Indenture.

 

[END OF ARTICLE VII]

 

18

 

ARTICLE VIII

 

MISCELLANEOUS PROVISIONS

 

Section 8.01.          Ratification

of Indenture.  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.

 

Section 8.02.          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 8.03.          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.

 

Section 8.04.          Private

Placement of Series 2002-A Notes; Form of Delivery of

Series 2002-A Notes.

 

(a)  The Series

2002-A Notes have not been registered under the Securities Act or any state

securities law.  No transfer of any

Series 2002-A Note shall be made except to the Purchaser or in accordance with

the terms of the Note Purchase Agreement and either (i) pursuant to an

effective registration under the Securities Act and applicable state securities

or “blue sky” laws or (ii) in a transaction exempt from the registration

requirements of the Securities Act and applicable state securities or “blue

sky” laws, to (A) a person who the transferor reasonably believes is a

Qualified Institutional Buyer within the meaning thereof in Rule 144A

under the Securities Act that is aware that the resale or other transfer is

being made in reliance on Rule 144A, (2) a person who is an

accredited investor as defined in Rule 501(a) under the Securities Act or

(3) an institution which has such knowledge and experience in financial

and business matters as to be capable of evaluating the merits and risks of the

investment therein.  The Series 2002-A

Notes shall bear legends to the effect set forth in Exhibit A.  None of the Transferor, the Transfer Agent

and Registrar, the Owner Trustee, the Indenture Trustee or the Note

Administrator is obligated to register the Series 2002-A Notes under the

Securities Act or any other securities or “blue sky” law or to take any other

action not otherwise required under this Indenture Supplement, the Indenture or

the Transfer and Servicing Agreement to permit the transfer of Series 2002-A

Notes without registration or as described above.

 

(b)   The Series 2002-A Notes shall be Definitive

Notes and shall be delivered as Registered Notes as provided in

Section 2.03 of the Indenture.

 

Section 8.05.          Successors

and Assigns. 

This Indenture Supplement shall be binding upon and inure to the benefit

of the parties hereto and their respective permitted

 

19

 

successors and assigns, except that the Issuer may not

assign or transfer any of its rights under this Indenture Supplement without

the prior written notice to each Rating Agency.

 

Section 8.06.          [Reserved]

 

Section 8.07.          Transfer

of the Notes.  Notwithstanding

anything to the contrary in this Indenture Supplement, no interest in a Note

may be directly or indirectly sold, conveyed, assigned, hypothecated, pledged,

participated, exchanged or otherwise transferred (each a “Transfer”) (other than

in connection with its initial issuance to the Issuer) except to a Person who

is a “United States person” for United States federal income tax purposes and

only upon the prior delivery of a Tax Opinion to the Indenture Trustee and the

Note Administrator, and any such transfer in violation of these requirements

shall be null and void ab initio.

 

Section 8.08.          Limitation of Liability.  Notwithstanding any other provision herein

or elsewhere, this Indenture Supplement has been executed and delivered by

Wilmington Trust Company, not in its individual capacity, but solely in its

capacity as Owner Trustee of the Trust. 

In no event shall Wilmington Trust Company 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.

 

[END OF ARTICLE VIII]

 

[SIGNATURE PAGE FOLLOWS]

 

20

 

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.

 

	

   

  	

  CSGQ Trust, as Issuer

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

  Wilmington Trust Company

  
	

   

  	

   

  	

  not in its individual capacity, but solely as

  Owner Trustee

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:

  
	

   

  	

   

  	

  Title

  
	

   

  	

   

  	

   

  
	

   

  	

  U.S. Bank National

  Association,

  
	

   

  	

  as Indenture Trustee

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:

  
	

   

  	

   

  	

  Title

  
	

   

  	

   

  	

   

  
	

   

  	

  CITIBANK, N.A.,

  
	

   

  	

  as Note Administrator

  
	

   

  	

   

  	

   

  
	

   

  	

   

  	

   

  
	

   

  	

  By:

  	

   

  	

   

  
	

   

  	

   

  	

  Name:

  
	

   

  	

   

  	

  Title

  
	

   

  	

   

  
									

 

Acknowledged and Accepted:

 

COMPUCREDIT CORPORATION,

as Servicer

 

 

	

  By:

  	

   

  	

   

  
	

   

  	

  Name:

  
	

   

  	

  Title:

  

 

E-1

 

PACCT, LLC,

as Transferor

 

 

	

  By:

  	

   

  	

   

  
	

   

  	

  Name:

  
	

   

  	

  Title:

  

 

 

E-2

 

EXHIBIT A

 

FORM OF

SERIES 2002-A VARIABLE FUNDING NOTE

 

E-3

 

EXHIBIT

B

 

FORM

OF STATEMENT TO NOTEHOLDERS

 

E-4

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