Risk Factors

        There are material risks associated with an investment in the Series 200  -  notes, and you should consider the matters set forth under " Risk Factors " beginning on page S-11 and on page 2 of the accompanying prospectus.

Ratings

        It is a condition to the issuance of your notes that one of the ratings set forth for each class of Series 200  -  notes under the caption " Offered Notes " above be obtained.

        Any rating assigned to the notes by a credit rating agency will reflect the rating agency's assessment solely of the likelihood that noteholders will receive the payments of interest and principal required to be made under the terms of the series and will be based primarily on the value of the transferred receivables and the credit enhancement provided. The rating is not a recommendation to purchase, hold or sell any notes. The rating does not constitute a comment as to the marketability of any notes, any market price or suitability for a particular investor. Any rating can be changed or withdrawn by a rating agency at any time.

[Exchange Listing

        We will apply to list the Series 200  -  notes on the Luxembourg Stock Exchange. We cannot guarantee that the application for the listing will be accepted.]

RFS Holding, L.L.C.

        Our address is 1600 Summer Street, Stamford, Connecticut 06927. Our phone number is (203) 585-6669.

S-10

        This prospectus supplement uses defined terms. You can find a glossary of terms under the caption " Glossary of Terms for Prospectus Supplement " beginning on page S-36 in this prospectus supplement and under the caption "Glossary of Terms for Prospectus" beginning on page 80 in the accompanying prospectus.

Risk Factors

        In addition to the risk factors described in the prospectus, you should consider the following.

It may not be possible to find a purchaser for your securities.

        There is currently no public secondary market for the notes and we cannot assure you that one will develop. Thus you may not be able to resell your notes at all, or may be able to do so only at a substantial discount. The underwriters may assist in resales of the notes, but they are not required to do so. We do not intend to apply [for listing of the notes on any securities exchange or] for the inclusion of the notes on any automated quotation system. A trading market for the notes may not develop. If a trading market does develop, it might not continue or it might not be sufficiently liquid to allow you to resell any of your notes.

If the ratings of the notes are lowered or withdrawn, the market value of the notes could decrease

        It is a condition to the issuance of the notes that they receive the ratings from the rating agencies set forth under the caption " Offered Notes " in this prospectus supplement. A rating is not a recommendation to purchase, hold or sell the notes, inasmuch as the rating does not comment as to market price or suitability for a particular investor. The ratings of the notes address the likelihood of the timely payment of interest and the ultimate repayment of principal of the notes pursuant to their respective terms. There is no assurance that a rating will remain for any given period of time or that a rating will not be lowered or withdrawn entirely by a rating agency if in its judgment circumstances in the future so warrant. The ratings of the notes are based primarily on the value of the transferred receivables, and the credit enhancement provided. In the event that the rating initially assigned to any notes is subsequently lowered or withdrawn for any reason, you may not be able to resell your notes without a substantial discount.

Payments on the Class B notes are subordinate to payments on the Class A notes.

        If you buy Class B notes, your interest payments will be subordinate to interest payments on the Class A notes, and your principal payments will be subordinate to principal payments on the Class A Notes as follows:

•

You will not receive any interest payments on your Class B notes on any payment date until net swap payments, if any, due from the issuer under the Class A interest rate swap and the full amount of interest then payable on the Class A notes, in each case, has been paid in full.



•

In addition, you will not receive any principal payments on your Class B notes on any payment date until the entire principal balance of the Class A notes has been paid in full.

        As a result of these features, any decrease in the collateral amount for your series due to charge-offs, dilution or reallocation of principal will reduce payments on the Class B notes before reducing payments on the Class A notes.

S-11

         Payments on the Class C notes are subordinate to payments on the Class A notes and the Class B notes.

        If you buy Class C notes, your interest payments will be subordinate to interest payments on the Class A notes and the Class B notes, and your principal payments will be subordinate to principal payments on the Class A notes and Class B notes as follows:

•

You will not receive any interest payments on your Class C notes on any payment date until net swap payments, if any, due from the issuer under the Class A and Class B interest rate swaps and the full amount of interest then payable on the Class A notes and the Class B notes, in each case, has been paid in full.



•

In addition, except under the limited circumstances described under " Description of Series Provisions—Spread Account Distributions ," you will not receive any principal payments on your Class C notes on any payment date until the entire principal balance of the Class A notes and the Class B notes has been paid in full.

        As a result of these features, any decrease in the collateral amount for your series due to charge-offs, dilution or reallocation of principal will reduce payments on the Class C notes before reducing payments on the Class B notes or Class A notes.

Receivables Performance

        The trust portfolio includes a subset of the accounts arising in the bank's private label programs for specified retailers. We refer to these specified retailers as the "approved retailers" and the accounts, whether or not designated for inclusion in the trust portfolio, arising in the private label programs for the approved retailers as the "bank's approved portfolio." The private label programs for the approved retailers [constituting more than [    ]% of the accounts in the trust portfolio] are listed in the table " Composition by Retailer Trust Portfolio " under " The Trust Portfolio " below.

        The tables below contain performance information for the receivables in the bank's approved portfolio for each of the periods shown. The composition of the bank's approved portfolio is expected to change over time and accounts arising in the private label programs for additional retailers may be added to the bank's approved portfolio and the trust portfolio in the future. Because the trust portfolio is only a subset of the bank's approved portfolio, the actual performance of the transferred receivables may be different from that set forth below.

Delinquency and Loss Experience

        The following tables set forth the aggregate delinquency and loss experience for cardholder payments on the credit card accounts in the bank's approved portfolio for each of the dates or periods shown. Receivables outstanding includes both principal receivables and finance charge receivables and Gross Charge-Offs include charge-offs of both principal receivables and finance charge receivables. Average receivables outstanding is the average of the total receivables balances as of the last day of each fiscal month for the bank in the period indicated.

        We cannot assure you that the future delinquency and loss experience for the receivables in either the bank's approved portfolio or the trust portfolio will be similar to the historical experience for the bank's approved portfolio set forth below.

S-12

S-13

Revenue Experience

        The gross revenues from finance charges and fees related to accounts in the bank's approved portfolio for each of the periods shown are set forth in the following table. Fees include late fees and returned check fees. The amounts of Total Finance Charges and Fees reflected in the following table represent billed amounts before reductions for charge-offs, fraud, customer disputes and other expenses and after reductions for returned merchandise.

        We cannot assure you that the future revenue experience for the receivables in either the bank's approved portfolio or the trust portfolio will be similar to the historical experience for the bank's approved portfolio set forth below.

S-14

The Trust Portfolio

        The receivables to be conveyed to the trust have been or will be generated from transactions made by holders of credit card accounts included in the trust portfolio. A description of the bank's credit card business is contained in the prospectus under the caption " The Bank's Credit Card Activities. "

        As of the end of the day on [            ], 200[  ]:

•

The accounts designated for the trust portfolio had an average principal receivable balance of $                        and an average credit limit of $                        .



•

The percentage of the aggregate total receivable balance to the aggregate total credit limit was            %.



•

The average age of the accounts was approximately            months.

        The following tables summarize the trust portfolio by various criteria as of the end of the day on [            ], 200[  ], except that the Composition by Retailer Trust Portfolio table summarizes the retailers included in the trust portfolio as of the end of the day on [    ], 200[  ]. Because the future composition of the trust portfolio will change over time, these tables are not indicative of the composition of the trust portfolio at any subsequent time.

S-15

S-16

        Cardholders whose accounts are designated for the trust portfolio had billing addresses in all 50 states and the District of Columbia except for    % of the aggregate total principal receivable balance for which cardholders had billing addresses located outside of the United States or the District of Columbia. Except for the five states listed below, no state accounted for more than 5% of the number of accounts or 5% of the total principal receivables balances as of [            ], 200[  ].

S-17

Maturity Considerations

        Series 200  -  will always be in one of three periods—the revolving period, the controlled accumulation period or the early amortization period. Unless an early amortization event occurs, each class of notes will not receive payments of principal until the expected principal payment date for that class. The expected principal payment date for the Class A, Class B and Class C notes will be the payment date in [            ] 200[  ]. We expect, but cannot assure you, that the issuer will have sufficient funds to pay the full principal amount of each class of Series 200  -  notes on the expected principal payment date. However, if an early amortization event occurs, principal payments for the Series 200  -  notes may begin prior to the expected principal payment date.

Controlled Accumulation Period

        During the controlled accumulation period, principal allocated to the Series 200  -  noteholders will accumulate in the principal accumulation account in an amount calculated to pay the Class A, Class B and Class C notes in full on the expected principal payment date. We expect, but cannot assure you, that the amounts available in the principal accumulation account on the expected principal payment date will be sufficient to pay in full the outstanding principal amount of the Series 200  -  notes. If there are not sufficient funds on deposit in the principal accumulation account to pay any class of notes in full on the expected principal payment date, an early amortization event will occur and the early amortization period will begin.

Early Amortization Period

        If an early amortization event occurs during either the revolving period or the controlled accumulation period, the early amortization period will begin. On each payment date during the early amortization period, principal allocated to the Series 200  -  noteholders, including any amount on deposit in the principal accumulation account will be paid:

•

first to Class A noteholders, up to the outstanding principal balance of the Class A notes;



•

then to Class B noteholders, up to the outstanding principal balance of the Class B notes; and



•

then to Class C noteholders, up to the outstanding principal balance of the Class C notes.

        The issuer will continue to pay principal in the priority noted above to the noteholders on each payment date during the early amortization period until the earliest of the date the notes are paid in full, the date on which the collateral amount is reduced to zero and the Series 200  -  final maturity date, which is the                        , 200  payment date. Except as described under " Description of Series Provisions — Spread Account ," no principal will be paid on the Class B notes until the Class A notes have been paid in full. No principal will be paid on the Class C notes until the Class A and Class B notes have been paid in full.

Payment Rates

        The payment rate on the receivables is the most important factor that will determine the size of principal payments during an early amortization period and whether the issuer has funds available to repay the notes on the expected principal payment date. The following table sets forth the highest and lowest cardholder monthly payment rates on the credit card accounts in the bank's approved portfolio during any month in the periods shown and the average cardholder monthly payment rates for all months in the periods shown, in each case calculated as a percentage of average total receivables for each month during the periods shown. Payment rates shown in the table are based on amounts that would be deemed payments of principal receivables and finance charge receivables with respect to the accounts.

S-18

        Although we have provided historical data concerning the payment rates on the receivables, because of the factors described in the prospectus under " Risk Factors, " we cannot provide you with any assurance that the levels and timing of payments on receivables in the trust portfolio from time to time will be similar to the historical experience described in the following table for the bank's approved portfolio or that deposits into the principal accumulation account will equal the applicable controlled accumulation amount. The issuer may shorten the controlled accumulation period and, in that event, we cannot provide any assurance that there will be sufficient time to accumulate all amounts necessary to pay the outstanding principal amount of the Series 200  -  notes on the expected principal payment date.

        We cannot assure you that the cardholder monthly payment rates for the bank's approved portfolio or for the trust portfolio in the future will be similar to the historical experience set forth above. In addition, the amount of collections of receivables may vary from month to month due to seasonal variations, general economic conditions and payment habits of individual cardholders.

Description of Series Provisions

        We have summarized the material terms of the Series 200  -  notes below and under " Description of the Notes " in the accompanying prospectus.

General

        The Class A, Class B and Class C notes comprise the Series 200  -  notes and will be issued under the indenture, as supplemented by the Series 200  -  indenture supplement, in each case between the issuer and the indenture trustee.

        The Series 200  -  notes will be issued in denominations of $1,000 and integral multiples of $1,000 and will be available only in book-entry form, registered in the name of Cede & Co., as nominee of DTC. See " Description of the Notes—General ," "— Book-Entry Registration " and "— Definitive Notes " in the accompanying prospectus. Payments of interest and principal will be made on each payment date on which those amounts are due to the noteholders in whose names the Series 200  -  notes were registered on the related record date, which will be the last day of the calendar month preceding that payment date.

        [We will apply to list the notes on the Luxembourg Stock Exchange; however, we cannot assure you that the listing will be obtained. You should consult with the Luxembourg listing agent for the notes, [Address] Luxembourg, phone number (    )            , for the status of the listing.]

S-19

Collateral Amount

        Your notes are secured by collateral consisting of an ownership interest in the transferred receivables. The amount of the collateral for your notes, which we call the collateral amount, will initially be $[            ] and will thereafter be reduced by:

(a)

all principal collections applied to make principal payments on the Series 200  -  notes or deposited into the principal accumulation account;



(b)

reductions in the excess collateral amount that result from reductions in the required amount of the excess collateral as described under "— Excess Collateral Amount " below; and



(c)

all reductions to the collateral amount as a result of defaulted receivables or uncovered dilution allocated to your series or reallocations of principal collections to cover interest or the servicing fee for your series that have not been reversed.

        The collateral amount cannot be less than zero.

        Reductions described in clause (c) above will be reversed to the extent that finance charge collections are available for that purpose on any subsequent payment date.

Allocation Percentages

        The servicer, on behalf of the issuer, will allocate among the collateral amount for your series, the collateral amount of each other series of notes issued and outstanding and the Free Equity Amount, the following items: the issuer's share of collections of finance charge receivables and principal receivables, the issuer's share of defaulted receivables and the issuer's share of dilution amounts that are not offset by the Free Equity Amount or reimbursed by us. The issuer's share of the foregoing amounts will be calculated as described in the accompanying prospectus under the caption " The Trust Portfolio ."

        On any day, the allocation percentage for your series will be the percentage equivalent—which may not exceed 100%—of a fraction:

•

the numerator of which is:



•

for purposes of allocating finance charge collections and defaulted receivables at all times and principal collections during the revolving period, equal to the collateral amount as measured at the end of the prior Monthly Period (or, in the case of the month during which the closing date occurs, on the closing date); and



•

for purposes of allocating principal collections during the controlled accumulation period and the early amortization period, equal to the collateral amount as of the end of the revolving period; and



•

the denominator of which is the greater of:



(a)

the Aggregate Principal Receivables as of a specified date; and



(b)

the sum of the numerators used to calculate the applicable allocation percentages for all series of notes outstanding as of the date of determination.

        The denominator referred to above will initially be set as of the closing date. The denominator will be reset for purposes of allocating principal collections, finance charge collections and defaulted receivables at all times as follows:

•

at the end of each Monthly Period;



•

on each date on which additional accounts are designated to the trust portfolio;



•

on each date on which accounts are removed from the trust portfolio in an aggregate amount approximately equal to the collateral amount of any series that has been paid in full;



•

on each date on which there is an increase in the outstanding balance of any variable interest issued by the issuer; and



•

on each date on which a new series of notes or a class of notes relating to a multiple issuance series is issued.

S-20

Interest Payments

        The Class A notes will accrue interest from and including the closing date through but excluding            , 200  , and for each following interest period, at a rate of        % per year [above LIBOR for the related interest period.]

        The Class B notes will accrue interest from and including the closing date through but excluding            , 200  , and for each following interest period, at a rate of        % per year [above LIBOR for the related interest period.]

        The Class C notes will accrue interest from and including the closing date through but excluding            , 200  , and for each following interest period, at a rate of    % per year [above LIBOR for the related interest period.]

        Each interest period will begin on and include a payment date and end on but exclude the next payment date. However, the first interest period will begin on and include the closing date.

        [For purposes of determining the interest rates applicable to each interest period, LIBOR will be determined two London business days before that interest period begins and will equal the rate per annum displayed in the Bloomberg Financial Markets system as the composite offered rate for London interbank deposits for a one-month period, as of 11:00 a.m., London time, on that date. If that rate does not appear on that display page, the rate for that date will be the rate per annum shown on page 3750 of the Bridge Telerate Services Report screen or any successor page as the composite offered rate for London interbank deposits for a one-month period, as shown under the heading "USD" as of 11:00 a.m., London time, two London business days before that interest period begins. If no rate is shown as described in the preceding two sentence, LIBOR will be the rate per annum based on the rates at which Dollar deposits for a one-month period are displayed on page "LIBOR" of the Reuters Monitor Money Rates Service or such other page as may replace the LIBOR page on that service for the purpose of displaying London interbank offered rates of major banks as of 11:00 a.m., London time, two London business days before that interest period begins; provided that if at lease two rates appear on that page, the rate will be the arithmetic mean of the displayed rates and if fewer than two rates are displayed, or if no rate is relevant, LIBOR will be determined based on the rates at which deposits in United States dollars are offered by four 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 indenture trustee will request the principal London office of each of those banks to provide a quotation of its rate. If at least two quotations are provided, the rate for that date will be the arithmetic mean of the quotations. If fewer than two quotations are provided, the rate for that 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.]

        [The interest rates applicable to the then current and immediately preceding interest period may be obtained by telephoning the indenture trustee at its corporate trust office at [                        ] or any other telephone number identified in a written notice from the indenture trustee to the Series 200  -  noteholders from time to time.]

        Interest on the notes will be calculated on the basis of the [actual number of days in the related interest period and] a 360-day year [of twelve 30-day months].

        If the issuer does not pay interest as calculated above to any class on a payment date, the amount not paid will be due on the next payment date, together with interest on the overdue amount of regular monthly interest at 2% plus the interest rate payable on the notes for the applicable class.

S-21

[Interest Rate Swaps

        To hedge the issuer's interest payment obligations, the issuer will enter into an interest rate swap for each of the Class A, Class B and Class C notes, each covering the period from the closing date through the [expected principal payment date] [final maturity date].

        The notional amount of the Class A interest rate swap, the notional amount of the Class B interest rate swap and the notional amount of the Class C interest rate swap for each interest period will be equal to the outstanding principal balance of each of the Class A, Class B and Class C notes, respectively, in each case as of the end of the first day of the related interest period. Under each swap, on each payment date, if one-month LIBOR for the related interest period, exceeds a specified fixed rate, the issuer will receive payments from the swap counterparty equal to:

        where the rate differential equals one-month LIBOR for the related interest period, minus the specified fixed rate. Alternatively, if one-month LIBOR for the related interest period, is less than the applicable specified fixed rate, the issuer will be required to make a payment to the swap counterparty equal to the result of the equation shown above, where the rate differential equals the specified fixed rate minus one-month LIBOR for the related interest period. The specified fixed rate for the Class A interest rate swap is [    ]% per year. The specified fixed rate for the Class B interest rate swap is [    ]% per year. The specified fixed rate for the Class C interest rate swap is [    ]% per year.

        Any net amounts received by the issuer under the interest rate swaps will be treated as collections of finance charge receivables. Any net amounts payable by the issuer under the Class A interest rate swap will be paid from finance charge collections at the same priority as the interest payments on the Class A notes. Any net amounts payable by the issuer under the Class B interest rate swap will be paid from finance charge collections at the same priority as interest payments on the Class B notes. Any net amounts payable by the issuer under the Class C interest rate swap will be paid from finance charge collections at the same priority as interest payments on the Class C notes, but unlike Class C interest payments they will also have the benefit of reallocated principal collections, if necessary.

        The issuer can only enter into and maintain interest rate swap agreements with counterparties that have debt ratings consistent with the standards of the rating agencies for the notes. If one of these rating agencies withdraws or lowers its rating for a swap counterparty, the servicer may obtain a replacement swap from a counterparty having the required credit ratings. Alternatively, it may enter into some other arrangement satisfactory to the rating agencies for the notes. See " Risk Factors—Default by interest rate swap counterparty or termination of interest rate swap could lead to the commencement of an early amortization period " for a discussion of potential adverse consequences in the event the servicer is unable to obtain a replacement swap or enter into any other satisfactory arrangement.]

[Interest Rate Swap Counterparty

        [Description of Swap Counterparty]]

Principal Payments

        During the revolving period, no principal payments will be made on your notes. During the controlled accumulation period and the early amortization period, deposits to the principal

S-22

accumulation account and principal payments on the Series 200  -  notes, as applicable, will be made on each payment date from the following sources:

(a)

principal collections allocated to your series based on your allocation percentage and required to be deposited into the collection account for your series, less any amounts required to be reallocated to cover interest payments on the Series 200  -  notes or servicing fees payments; plus



(b)

any amount on deposit in the excess funding account allocated to your series on that payment date; plus



(c)

any finance charge collections or other amounts required to be treated as principal collections in order to cover the share of defaulted receivables and uncovered dilution amounts allocated to your series or to reinstate prior reductions to the collateral amount; plus



(d)

any principal collections from other series that are shared with your series.

Controlled Accumulation Period

        The controlled accumulation period is scheduled to commence on [            ], 200  -[  ] and to last [    ] months. On each determination date until the controlled accumulation period begins, the servicer, on behalf of the issuer, will review the amount of expected principal collections and determine the number of months expected to be required to fully fund the principal accumulation account by the expected principal payment date as described under " Description of the Notes—Length of Controlled Accumulation Period " in the accompanying prospectus. If the number of months needed to fully fund the principal accumulation account by the expected principal payment date is less than or more than the number of months in the scheduled controlled accumulation period, the issuer will either postpone the controlled accumulation period or start the controlled accumulation period earlier than the then-currently scheduled controlled accumulation period, as applicable, so that the number of months in the scheduled controlled accumulation period equals the number of months expected to be needed to fully fund the principal accumulation account by the expected principal payment date. In no event will the issuer postpone the beginning of the controlled accumulation period to later than [            ], 200[  ].

        On each payment date relating to the controlled accumulation period, funds will be deposited in the principal accumulation account in amount equal to the least of:

(1)

funds available for this purpose for your series with respect to that payment date;



(2)

the outstanding principal balance of the Series 200  -  notes as of the last day of the revolving period, divided by the number of months in the controlled accumulation period;



(3)

an amount equal to the outstanding principal amount of the notes, minus the amount on deposit in the principal accumulation account prior to any deposits on that date; and



(4)

the collateral amount.

        Any remaining funds not deposited in the principal accumulation account first will be made available to other series as shared principal collections and second will either be deposited in the excess funding account under the circumstances described under " Description of the Notes—Excess Funding Account " in the accompanying prospectus or distributed to us or our assigns. During the controlled accumulation period, if the excess collateral amount exceeds the required excess collateral amount, the excess collateral amount will be reduced, but not below the required excess collateral amount, by the amount of funds applied as described in the preceding sentence.

        Unless an early amortization period commences prior to the expected principal payment date, amounts in the principal accumulation account will be paid on the expected principal payment date to

S-23

the Class A noteholders until the outstanding principal balance of the Class A notes has been paid in full, then to the Class B noteholders until the outstanding principal balance of the Class B notes has been paid in full, and then to the Class C noteholders until the outstanding principal balance of the Class C notes has been paid in full.

Early Amortization Period

        On each payment date relating to the early amortization period, the Class A noteholders will be entitled to receive funds available for principal payments for Series 200  -  for the related Monthly Period in an amount up to the outstanding principal balance of the Class A notes.

        After payment in full of the outstanding principal balance of the Class A notes, the Class B noteholders will be entitled to receive, on each payment date relating to the early amortization period, the remaining available funds for Series 200  -  for the related Monthly Period in an amount up to the outstanding principal balance of the Class B notes.

        After payment in full of the outstanding principal balance of the Class A notes and the Class B notes, the Class C noteholders will be entitled to receive on each payment date relating to the early amortization period, the remaining available funds for Series 200  -  for the related Monthly Period in an amount up to the outstanding principal balance of the Class C notes.

        See "— Early Amortization Events " below for a discussion of events that might lead to the commencement of the early amortization period.

Subordination

        The Class B notes are subordinated to the Class A notes. The Class C notes are subordinated to the Class A notes and the Class B notes. The excess collateral amount is subordinated to all three classes of notes. Interest payments will be made on the Class A notes prior to being made on the Class B notes and the Class C notes. Interest payments will be made on the Class B notes prior to being made on the Class C notes.

        Principal payments on the Class B notes will not begin until the Class A notes have been paid in full. Except as described under " Description of Series Provisions—Spread Account Distributions," principal payments on the Class C notes will not begin until the Class A notes and the Class B notes have been paid in full.

        The collateral amount for your series will be reduced as the collateral is applied for the benefit of your series, for instance as principal payments are made on your series (other than principal payments made from funds on deposit in the spread account). In addition, the collateral amount can be applied for the benefit of your series in two other ways:

•

by reallocating principal collections to make interest payments and to pay net swap payments due from the issuer, to pay the fees of the indenture trustee, the Owner Trustee, the trustee for RFS Funding Trust and the administrator for the issuer and the servicing fee for your series, when finance charge collections are not sufficient to make these payments; and



•

to absorb your series' share of defaulted receivables and any uncovered dilution amounts, when finance charge collections are not sufficient to cover these amounts.

        The excess collateral amount provides credit enhancement by absorbing these types of reductions. If the total amount of these latter two types of reductions exceeds the excess collateral amount, then the Class C notes may not be repaid in full. If the total amount exceeds the excess collateral amount and the principal amount of the Class C notes, then the Class B notes may not be repaid in full. If the total amount exceeds the sum of the excess collateral amount and the principal amounts of the Class C and Class B notes, then the Class A notes may not be repaid in full.

S-24

        If receivables are sold after an event of default, the net proceeds of that sale would be paid first to the Class A notes, then to the Class B notes and finally to the Class C notes, in each case until the outstanding principal amount of the specified class and all accrued and unpaid interest payable to that class have been paid in full.

Application of Finance Charge Collections

        We refer to your series' share of finance charge collections, including net investment proceeds transferred from the principal accumulation account, net swap receipts, amounts withdrawn from the reserve account and any available excess finance charge collections from other series, collectively, as finance charge collections. On each payment date, the servicer, on behalf of the issuer, will apply your series' share of finance charge collections for the prior month in the following order:

(1)

to pay, pro rata , the accrued and unpaid fees and other amounts owed to the indenture trustee up to a maximum amount of $25,000 for each calendar year accrued and unpaid fees and other amounts owed to the trustee for RFS Funding Trust up to a maximum amount of $25,000, for each calendar year accrued and unpaid fees and other amounts owed to the Owner Trustee up to a maximum amount of $25,000 and for each calendar year accrued and unpaid fees and other amounts owed to the administrator for the issuer up to a maximum amount of $25,000 for each calendar year;



(2)

to pay the servicing fee for your series for the prior Monthly Period and any overdue servicing fee (to the extent not directly paid by the issuer to the servicer during the month);



(3)

to pay, pro rata , interest on the Class A notes, including any overdue interest and additional interest on the overdue interest, and any net swap payments due from the issuer under the Class A interest rate swap;



(4)

to pay, pro rata , interest on the Class B notes, including any overdue interest and additional interest on the overdue interest, and any net swap payments due from the issuer under the Class B interest rate swap;

(5)

to pay interest, pro rata , on the Class C notes, including any overdue interest and additional interest on the overdue interest, and any net swap payments due from the issuer under the Class C interest rate swap;

(6)

an amount equal to your series' share of the defaulted receivables and uncovered dilution, if any, for the related Monthly Period, will be treated as principal collections for the prior Monthly Period;

(7)

an amount equal to any previous reductions to the collateral amount on account of defaulted receivables, uncovered dilution or reallocations of principal collections in each case not previously reversed will be treated as principal collections for the prior Monthly Period;

(8)

on and after the reserve account funding date, to deposit into the reserve account an amount equal to the excess, if any, of the required reserve account amount over the amount then on deposit in the reserve account;

(9)

to deposit into the spread account an amount equal to the excess, if any, of the required spread account amount over the amount then on deposit in the spread account;

(10)

to make various payments and deposits relating to the interest rate swaps;

(11)

to pay, pro rata , any amounts owed to the indenture trustee, the trustee for RFS Funding Trust, the Owner Trustee and the administrator for the issuer to the extent not paid pursuant to clause (1) above;

(12)

to cover any shortfalls in finance charge collections for other outstanding series in group one; and

(13)

if an early amortization event has occurred, to make principal payments on the Class A, Class B and Class C notes, in that order of priority.

S-25

Reallocation of Principal Collections

        If finance charge collections available to your series are not sufficient to pay the aggregate amount of those payments described in clauses (1) through (5) under the caption " —Application of Finance Charge Collections " above, then principal collections allocated to your series will be reallocated to cover these amounts. Any reallocation of principal collections is a use of the collateral for your notes. Consequently, these uses will reduce the remaining collateral amount by the amount that was reallocated. The amount of principal collections that will be reallocated on any payment date will not exceed the sum of the amounts described in the following clauses (1) through (3):

(1)

the lesser of:

•

the excess of (a) the amounts needed to make those payments described in clauses (1), (2) and (3) under the caption " —Application of Finance Charge Collections " above over (b) the amount of finance charge collections available to cover these amounts; and

•

the excess, if any, of (a) [    ]% of the initial collateral amount over (b) the sum of (i) the amount of unreimbursed investor charge-offs after giving effect to investor charge-offs for the related Monthly Period, (ii) the amount of unreimbursed reallocated principal collections as of the previous payment date and (iii) any reductions to the collateral amount on account of reductions to the required excess collateral amount;

(2)

the lesser of:

•

the excess of (a) the sum of the amounts needed to make those payments described in clause (4) under the caption " —Application of Finance Charge Collections " above over (b) the amount of finance charge collections available to cover these amounts; and

•

the excess, if any, of (a) [    ]% of the initial collateral amount over (b) the sum of (i) the amount of unreimbursed investor charge-offs after giving effect to investor charge-offs for the related Monthly Period, (ii) the amount of unreimbursed reallocated principal collections as of the previous payment date and after giving effect to the reallocation of principal collections to make the payments described in clauses (1), (2) and (3) under the caption " —Application of Finance Charge Collections " above on the then current payment date and (iii) any reductions to the collateral amount on account of reductions to the required excess collateral amount; and

(3)

the lesser of:

•

the excess of the sum of (a) the amount needed to make the payment described in clause (5) under the caption " —Application of Finance Charge Collections " above over (b) the amount of finance charge collections and amounts withdrawn from the spread account that are available to cover that amount; and

•

the excess, if any, of (a) [    ]% of the initial collateral amount over (b) the sum of (i) the amount of unreimbursed investor charge-offs after giving effect to investor charge-offs for the related Monthly Period, (ii) the amount of unreimbursed reallocated principal collections as of the previous payment date and after giving effect to the reallocation of principal collections to make the payments described in clauses (1) through (4) under the caption " —Application of Finance Charge Collections " above on the then current payment date and (iii) any reductions to the collateral amount on account of reductions to the required excess collateral amount.

Investor Charge-Offs

        A portion of the issuer's share of the defaulted principal receivables in each charged-off account will be allocated to the collateral amount for your series in an amount equal to your series' allocation percentage on the date the account is charged-off. The allocation percentage is described under

S-26

"— Allocation Percentages " above. The issuer's pro rata share of the defaulted principal receivables will be calculated as described in the accompanying prospectus under the caption " The Trust Portfolio ."

        Dilution will also be allocated to the collateral amount for your series in the circumstances described in " Description of the Notes — Defaulted Receivables; Dilution; Investor Charge-Offs " in the accompanying prospectus. If dilution is allocated among each series for any Monthly Period, your series' share of dilution will equal:

(1)

dilution to be allocated to all series for that Monthly Period, times

(2)

a fraction,

•

the numerator of which is your series' allocation percentage for purposes of allocating finance charge collections for that Monthly Period, as described under "— Allocation Percentages " above, and

•

the denominator of which is the sum of the allocation percentages used by all outstanding series for purposes of allocating finance charge collections;

provided that, if the allocation percentage for finance charge collections for any series has been reset during that Monthly Period, for the portion of the Monthly Period falling on and after each reset date and prior to any subsequent reset date, the fraction described in clause (2) above will be calculated using a denominator which is equal to the sum of the numerators used in determining the allocation percentage for finance charge collections for all outstanding series as of the close of business on the subject reset date.

        On each payment date, if the sum of the defaulted principal receivables and any remaining uncovered dilution allocated to the collateral amount for your series is greater than the finance charge collections used to cover those amounts, then the collateral amount will be reduced by the amount of the excess. Any reductions in the collateral amount on account of defaulted principal receivables and uncovered dilution will be reversed to the extent that finance charge collections are available for that purpose on any subsequent payment date.

Sharing Provisions

        Your series is in group one for purposes of sharing excess finance charge collections. Your series will share excess finance charge collections with other series in group one. See " Description of the Notes—Shared Excess Finance Charge Collections " in the accompanying prospectus.

        Your series is a principal sharing series; however, your series will not be entitled to share excess principal collections from other series on any payment date during the early amortization period that is prior to the expected principal payment date. See " Description of the Notes—Shared Principal Collections " and "— Excess Funding Account " in the accompanying prospectus.

Principal Accumulation Account

        The issuer will establish and maintain a segregated trust account to serve as the principal accumulation account. During the controlled accumulation period, the servicer, on behalf of the issuer, will make deposits to the principal accumulation account as described under "— Principal Payments " in this prospectus supplement.

        Funds on deposit in the principal accumulation account will be invested to the following payment date by the issuer in highly rated liquid investments that meet the criteria described in the indenture supplement. Investment earnings, net of investment losses and expenses, on funds on deposit in the principal accumulation account will be deposited in the collection account and treated as finance

S-27

charge collections available to your series for the related interest period. If, for any payment date, these net investment earnings are less than the sum of:

(a)

the product of (1) a fraction, the numerator of which is equal to the balance of the principal accumulation account, up to the outstanding principal balance of the Class A notes, on the record date immediately preceding that payment date, and the denominator of which is equal to the outstanding principal balance of the Class A notes on the record date immediately preceding that payment date and (2) the Class A monthly interest payment[, plus any net swap payments payable by the issuer under the Class A interest rate swap, minus net swap receipts payable by the swap counterparty under the Class A interest rate swap];



(b)

the product of (1) a fraction, the numerator of which is equal to the lesser of (i) the outstanding principal balance of the Class B notes and (ii) the balance of the principal accumulation account in excess of the outstanding principal balance of the Class A notes on the record date immediately preceding that payment date, and the denominator of which is equal to the outstanding principal balance of the Class B notes on the record date immediately preceding that payment date and (2) the Class B monthly interest payment[, plus any net swap payments payable by the issuer under the Class B interest rate swap, minus net swap receipts payable by the swap counterparty under the Class B interest rate swap];



(c)

the product of (1) a fraction, the numerator of which is equal to the balance of the principal accumulation account in excess of the outstanding principal balance of the Class A notes and Class B notes on the record date immediately preceding that payment date, and the denominator of which is equal to the outstanding principal balance of the Class C notes on the record date immediately preceding that payment date and (2) the Class C monthly interest payment[, plus any net swap payments payable by the issuer under the Class C interest rate swap, minus net swap receipts payable by the swap counterparty under the Class C interest rate swap];

        then the issuer will withdraw the shortfall, to the extent required and available, from the reserve account and deposit it in the collection account for use as finance charge collections that are available to your series.

Excess Collateral Amount

        An excess collateral amount provides credit enhancement for your series. The initial excess collateral amount will be $ [            ], which equals [    ]% of the initial collateral amount.

        On each payment date during the controlled accumulation period, the excess collateral amount will be decreased by the amount of funds that are available, but not required, to be deposited into the principal accumulation account on that payment date. However, no such reduction will be permitted to reduce the excess collateral amount below the required excess collateral amount. See " Description of Series Provisions—Controlled Accumulation Period " in this prospectus supplement and " Credit Enhancement—Excess Collateral Amount " in the accompanying prospectus.

        The required excess collateral amount for your series on any day is currently equal to [            ]% of the total collateral amount on that day. However, a percentage lower than [    ]% may be used to calculate the required excess collateral amount in the future if each rating agency we designate for the Series 200  -  notes confirms that the use of a lower percentage will not impair its ratings of the notes. In addition:

(a)

except as provided in clause (c), the required excess collateral amount will never be less than [    ]% of the initial collateral amount,

S-28

(b)

except as provided in clause (c), the required excess collateral amount will not be reduced during an early amortization period, and



(c)

the required excess collateral amount will never exceed the aggregate outstanding principal amount of the notes, minus the balance on deposit in the principal accumulation account.

Reserve Account

        The issuer will establish and maintain a segregated account to serve as the reserve account. The reserve account is established to assist with the distribution of interest on the notes during the controlled accumulation period and on the first payment date with respect to the early amortization period. On each payment date from and after the reserve account funding date, but prior to the termination of the reserve account, the issuer will apply finance charge collections available to your series to increase the amount on deposit in the reserve account to the extent the amount on deposit in the reserve account is less than the required reserve account amount.

        Unless each rating agency confirms that the postponement of the reserve account funding date will not impair its rating of the Series 200  -  notes, the reserve account funding date will be a date selected by the servicer, on behalf of the issuer, that is not later than the payment date with respect to the Monthly Period which commences three months prior to the commencement of the controlled accumulation period.

        The required reserve account amount for any payment date on or after the reserve account funding date will be equal to (a) .50% of the outstanding principal balance of the notes or (b) any other amount designated by us. We may only designate a lesser amount if each rating agency confirms that the designation will not impair its rating of any class of the Series 200  -  notes and we will certify to the indenture trustee that, based on the facts known to the certifying officer at the time, in our reasonable belief, the designation will not cause an early amortization event to occur for Series 200  -  .

        On each payment date, after giving effect to any deposit to be made to, and any withdrawal to be made from, the reserve account on that payment date, the issuer will withdraw from the reserve account an amount equal to the excess, if any, of the amount on deposit in the reserve account over the required reserve account amount, and the amount withdrawn will no longer be available for your notes. Any amounts withdrawn from the reserve account and distributed to us or our assigns will not be available for distribution to the noteholders.

        All amounts on deposit in the reserve account on any payment date—after giving effect to any deposits to, or withdrawals from, the reserve account to be made on that payment date—will be invested to the following payment date by the issuer, in highly rated liquid investments that meet the criteria described in the indenture supplement. The interest and other investment income, net of losses and investment expenses, earned on these investments will be either retained in the reserve account to the extent the amount on deposit is less than the required reserve account amount or deposited in the collection account and treated as finance charge collections available to your series.

        On or before each payment date with respect to the controlled accumulation period and on or before the first payment date with respect to the early amortization period, the issuer will withdraw from the reserve account and deposit in the collection account an amount equal to the lesser of:

(1)

the amount then on deposit in the reserve account with respect to that payment date; and

(2)

the amount of the shortfall described under "— Principal Accumulation Account " above.

        Amounts withdrawn from the reserve account on any payment date will be included as finance charge collections available to your series for that payment date.

S-29

        The reserve account will be terminated upon the earliest to occur of:

(1)

the first payment date for the early amortization period;

(2)

the expected principal payment date; and

(3)

the termination of the trust.

        Upon the termination of the reserve account, all amounts on deposit in the reserve account, after giving effect to any withdrawal from the reserve account on that date, will be distributed to us or our assigns. Any amounts withdrawn from the reserve account and distributed to us or our assigns will not be available for distribution to the noteholders.

Spread Account

        The issuer will establish and maintain as a segregated account primarily for the benefit of the Class C noteholders to serve as the spread account. Amounts on deposit in the spread account will be used as described below under "— Spread Account Distributions ."

        The spread account initially will not be funded, but will be funded up to the required spread account amount on each payment date from finance charge collections allocated to your series to the extent available for that purpose.

        The required spread account amount will be determined on each payment date as the product of:

(a)

the spread account percentage determined in accordance with the table below for that date of determination; and



(b)

(1) during the revolving period, the collateral amount; or



(2)

during the controlled accumulation period or early amortization period, the collateral amount as of the last day of the revolving period; provided that prior to the occurrence of an event of default and acceleration of the Series 200  -  notes, the required spread account amount will never exceed the outstanding principal balance of the Class C notes after taking into account any payments to be made on that payment date.

        The spread account percentage will be determined as follows:

        If an early amortization event with respect to Series 200  -  has occurred, the spread account percentage will equal [—]% and may not be subsequently reduced.

        Funds on deposit in the spread account will be invested by the issuer in highly rated liquid investments that meet the criteria described in the indenture supplement. Investment earnings, net of losses and investment expenses, will, except as otherwise indicated in this prospectus supplement, not be deposited into the spread account and will be distributed to the issuer. However, after an event of default and acceleration of the maturity of the Series 200  -  notes, these investment earnings will be available for payment to holders of the Series 200  -  notes as described under "— Spread Account Distributions " below.

S-30

Spread Account Distributions

        On or before each payment date, the issuer will withdraw from the spread account, and deposit in the distribution account for payment to the Class C noteholders and the swap counterparty under the Class C interest rate swap an amount equal to the lesser of:

(1)

the amount on deposit in the spread account with respect to that payment date; and

(2)

the shortfall, if any, in the amount of finance charge collections that are available to cover the interest payable on the Class C notes and any net payments due under the Class C interest rate swap.

        Unless an early amortization event occurs, the issuer will withdraw from the spread account and deposit into the collection account for distribution to the Class C noteholders on the expected principal payment date an amount equal to the lesser of:

(1)

the amount on deposit in the spread account after application of any amounts as set forth in the immediately preceding paragraph; and

(2)

the outstanding principal balance of the Class C notes after the application of any amounts on that payment date.

Except as provided in the following paragraph, if an early amortization event occurs, the amount, if any, remaining on deposit in the spread account, after making the payments described in the second preceding paragraph, will be applied to pay principal on the Class C notes on the earlier of the final maturity date and the first payment date on which the outstanding principal amount of the Class A and Class B notes has been paid in full.

        In addition, on any day after the occurrence of an event of default with respect to Series 200  -  and the acceleration of the maturity date, the issuer will withdraw from the spread account the outstanding amount on deposit in the spread account and deposit that amount into the distribution account for distribution to the Class C noteholders, the Class A noteholders and the Class B noteholders, in that order of priority, to fund any shortfalls in amounts owed to those noteholders.

Early Amortization Events

        An early amortization event may occur for the Series 200  -  notes upon the occurrence of any of the following events:

(a)

our failure (1) to make any payment or deposit on the date required to be made under the trust receivables purchase agreement or the transfer agreement on or before the date that is five business days after the date the payment or deposit is required to be made or (2) to observe or perform in any material respect its other covenants or agreements set forth in the trust receivables purchase agreement or the transfer agreement which failure has a material adverse effect on the Series 200  -  noteholders and which continues unremedied for a period of 60 days after written notice of the failure, requiring the same to be remedied has been given to us by the indenture trustee or to us and the indenture trustee by any holder of the Series 200  -  notes;



(b)

any representation or warranty made by us in the trust receivables purchase agreement or the transfer agreement or any information required to be given by us to identify the accounts proves to have been incorrect in any material respect when made or delivered and which continues to be incorrect in any material respect for a period of 60 days after written notice of the failure, requiring the same to be remedied, and as a result of which the interests of the noteholders are materially and adversely affected and continues to be materially and adversely

S-31

affected for the designated period; except that an early amortization event described in this subparagraph (b) will not occur if we have accepted reassignment of the related receivable or all related receivables, if applicable, within the designated period;

(c)

our failure to convey receivables in additional accounts or participations to the trust when required to do so;



(d)

any material servicer default after giving effect to applicable grace periods;



(e)

the average of the Portfolio Yields for any 3 consecutive Monthly Periods is less than the average of the Base Rates for the same Monthly Periods;



(f)

the outstanding principal balance of the Class A notes, the Class B notes or the Class C notes is not paid in full on the expected principal payment date;



(g)

specified bankruptcy, insolvency, liquidation, conservatorship, receivership or similar events relating to us or the bank;



(h)

we are unable for any reason to transfer receivables to the trust or the bank is unable to transfer receivables to us;



(i)

RFS Funding Trust or the issuer becomes subject to regulation as an "investment company" within the meaning of the Investment Company Act of 1940, as amended; or



(j)

an event of default for Series 200  -  and an acceleration of the maturity of the Series 200  -  notes occurs under the indenture.

        In the case of any event described in clause (a), (b) or (d) above, an early amortization event will be deemed to have occurred with respect to the notes only if, after any applicable grace period, either the indenture trustee or the Series 200  -  noteholders evidencing interests aggregating more than 50% of the aggregate unpaid principal amount of the Series 200  -  notes, by written notice to the issuer, with a copy to the indenture trustee if notice is given by the Series 200  -  noteholders, declare that an early amortization event has occurred with respect to the Series 200  -  notes as of the date of the notice.

        In the case of any event described in clause (g), (h) or (i), an early amortization event with respect to all series then outstanding, and in the case of any event described in clause (c), (e), (f) or (j) an early amortization event with respect to only the Series 200  -  notes, will occur without any notice or other action on the part of the indenture trustee or the Series 200  -  noteholders immediately upon the occurrence of the event.

        On the date on which an early amortization event is deemed to have occurred, the early amortization period will begin.

        See " Description of the Notes—Early Amortization Events " in the accompanying prospectus for an additional discussion of the consequences of insolvency, conservatorship or receivership events related to us and the bank.

Events of Default

        The events of default for Series 200  -  , as well as the rights and remedies available to the indenture trustee and the Series 200  -  noteholders when an event of default occurs, are described under " The Indenture—Events of Default; Rights Upon Event of Default " in the accompanying prospectus.

        In the case of an event of default involving bankruptcy, insolvency or similar events relating to the issuer, the principal amount of the Series 200  -   notes automatically will be deemed to be immediately due and payable. If any other event of default for Series 200  -  occurs, the indenture trustee or the

S-32

holders of not less than a majority of the then-outstanding principal balance of the Series 200  -  notes may declare the Series 200  -  notes to be immediately due and payable. If the Series 200  -  notes are accelerated, you may receive principal prior to the expected principal payment date for your class of notes.

Servicing Compensation and Payment of Expenses

        The servicing fee rate for your series is 2% per year. Your series' share of the servicing fee for each month will be calculated as described under " Description of the Notes—Servicing Compensation and Payment of Expenses " in the accompanying prospectus. However, the monthly servicing fee allocable to your series for the first payment date will equal $[            ].