Exhibit 4.1
EXECUTION COPY
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AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION,
AMERICAN EXPRESS CENTURION BANK
and
AMERICAN EXPRESS BANK, FSB
Transferors
AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC.
Servicer
and
THE BANK OF NEW YORK
Trustee
on behalf of the Certificateholders
of the American Express Master Trust
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AMENDED AND RESTATED MASTER POOLING AND SERVICING AGREEMENT
Dated as of April 16, 2004
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TABLE OF CONTENTS
Page
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Article I DEFINITIONS................................................................................1
Section 1.01 Definitions..................................................................1
Section 1.02 Other Definitional Provisions...............................................18
Article II APPOINTMENT OF TRUSTEE; CONVEYANCE OF RECEIVABLES ISSUANCE OF CERTIFICATES................19
Section 2.01 Appointment of Trustee; Conveyance of Receivables...........................19
Section 2.02 Acceptance by Trustee.......................................................20
Section 2.03 Representations and Warranties..............................................21
Section 2.04 Representations and Warranties of the Transferors Relating
to the Agreement and any Supplement and the Receivables.....................23
Section 2.05 Covenants of the Transferors................................................29
Section 2.06 Addition of Accounts........................................................31
Section 2.07 Removal of Accounts.........................................................34
Article III ADMINISTRATION AND SERVICING OF RECEIVABLES...............................................36
Section 3.01 Acceptance of Appointment and Other Matters Relating to
the Servicer................................................................36
Section 3.02 Servicing Compensation......................................................37
Section 3.03 Representations, Warranties and Covenants of the Servicer...................38
Section 3.04 Reports and Records for the Trustee.........................................41
Section 3.05 Annual Servicer's Certificate...............................................42
Section 3.06 Annual Independent Public Accountant's Servicing Report.....................42
Section 3.07 Tax Treatment...............................................................43
Section 3.08 Adjustments.................................................................43
Section 3.09 Remittance Processing Procedures............................................44
Article IV RIGHTS OF CERTIFICATEHOLDERS AND ALLOCATION AND APPLICATION OF COLLECTIONS................45
Section 4.01 Establishment of Collection Account and Special Funding
Account and Allocations with Respect to the Exchangeable Transferor's
Certificates................................................................45
Article V [ARTICLE V IS RESERVED AND MAY BE SPECIFIED IN ANY SUPPLEMENT WITH RESPECT TO ANY
SERIES]...................................................................................50
Article VI THE CERTIFICATES..........................................................................51
Section 6.01 The Certificates............................................................51
Section 6.02 Authentication of Certificates..............................................51
Section 6.03 Registration of Transfer and Exchange of Certificates.......................52
Section 6.04 Mutilated, Destroyed, Lost, or Stolen Certificates..........................55
Section 6.05 Persons Deemed Owners.......................................................55
Section 6.06 Appointment of Paying Agent.................................................56
Section 6.07 Access to List of Certificateholders' Names and Addresses...................57
Section 6.08 Authenticating Agent........................................................57
Section 6.09 Tender of Exchangeable Transferor Certificate...............................58
Section 6.10 Global Certificate; Euro Certificate Exchange Date..........................60
Section 6.11 Book-Entry Certificates.....................................................61
Section 6.12 Notices to Clearing Agency..................................................62
Section 6.13 Definitive Certificates.....................................................62
Section 6.14 Meetings of Certificateholders..............................................62
Article VII OTHER MATTERS RELATING TO THE TRANSFERORS.................................................65
Section 7.01 Liability of the Transferors................................................65
Section 7.02 Merger or Consolidation of, or Assumption of the
Obligations of, a Transferor................................................65
Section 7.03 Limitation on Liability of the Transferors..................................66
Section 7.04 Liabilities.................................................................66
Article VIII OTHER MATTERS RELATING TO THE SERVICER....................................................67
Section 8.01 Liability of the Servicer...................................................67
Section 8.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer................................................67
Section 8.03 Limitation on Liability of the Servicer and Others..........................67
Section 8.04 Indemnification of the Trust and the Trustee................................68
Section 8.05 The Servicer Not to Resign..................................................68
Section 8.06 Access to Certain Documentation and Information
Regarding the Receivables...................................................69
Section 8.07 Delegation of Duties........................................................69
Section 8.08 Examination of Records......................................................69
Article IX PAY OUT EVENTS............................................................................70
Section 9.01 Pay Out Events..............................................................70
Section 9.02 Additional Rights Upon the Occurrence of Certain Events.....................71
Article X SERVICER DEFAULTS.........................................................................73
Section 10.01 Servicer Defaults...........................................................73
Section 10.02 Trustee to Act; Appointment of Successor....................................75
Section 10.03 Notification to Certificateholders..........................................76
Section 10.04 Waiver of Past Defaults.....................................................77
Article XI THE TRUSTEE...............................................................................78
Section 11.01 Duties of Trustee...........................................................78
Section 11.02 Certain Matters Affecting the Trustee.......................................80
Section 11.03 Trustee Not Liable for Recitals in Certificates.............................81
Section 11.04 Trustee May Own Certificates................................................82
Section 11.05 The Servicer to Pay Trustee's Fees and Expenses.............................82
Section 11.06 Eligibility Requirements for Trustee........................................82
Section 11.07 Resignation or Removal of Trustee...........................................83
ii
Section 11.08 Successor Trustee...........................................................83
Section 11.09 Merger or Consolidation of Trustee..........................................84
Section 11.10 Appointment of Co-Trustee or Separate Trustee...............................84
Section 11.11 Tax Returns.................................................................85
Section 11.12 Trustee May Enforce Claims Without Possession of
Certificates................................................................85
Section 11.13 Suits for Enforcement.......................................................86
Section 11.14 Rights of Certificateholders to Direct Trustee..............................86
Section 11.15 Representations and Warranties of Trustee...................................86
Section 11.16 Maintenance of Office or Agency.............................................86
Section 11.17 Indemnification of the Trustee..............................................87
Article XII TERMINATION...............................................................................88
Section 12.01 Termination of Trust........................................................88
Section 12.02 Optional Purchase; Final Termination Date of Investor
Certificates of any Series..................................................89
Section 12.03 Final Payment with Respect to any Series....................................90
Section 12.04 Transferor's Termination Rights.............................................91
Article XIII MISCELLANEOUS PROVISIONS..................................................................92
Section 13.01 Amendment...................................................................92
Section 13.02 Protection of Right, Title and Interest to Trust............................94
Section 13.03 Limitation on Rights of Certificateholders..................................95
Section 13.04 Governing Law...............................................................95
Section 13.05 Notices.....................................................................96
Section 13.06 Severability of Provisions..................................................97
Section 13.07 Assignment..................................................................97
Section 13.08 Certificates Nonassessable and Fully Paid...................................97
Section 13.09 Further Assurances..........................................................97
Section 13.10 No Waiver; Cumulative Remedies..............................................97
Section 13.11 Counterparts................................................................97
Section 13.12 Third-Party Beneficiaries...................................................97
Section 13.13 Actions by Certificateholders...............................................98
Section 13.14 Merger and Integration......................................................98
Section 13.15 Headings....................................................................98
Section 13.16 Certificates and Opinions of Counsel........................................98
Section 13.17 Effect of Amendment No. 3...................................................99
EXHIBITS
Exhibit A: Form of Exchangeable Transferor Certificate
Exhibit B: Form of Assignment of Receivables in Additional
Accounts
Exhibit C: Form of Reassignment of Receivables
Exhibit D: Form of Initial Servicer's Report
Exhibit E: Form of Monthly Servicer's Certificate
Exhibit F: Form of Annual Servicer's Certificate
Exhibit G: Form of Opinion of Counsel with Respect to the Pooling
and Servicing Agreement and Additional Accounts
Exhibit H: Form of Annual Opinion of Counsel
Exhibit I: [Received]
Exhibit J: Form of Depositary Agreement (Letter of Representations)
Exhibit K: Form of Lock Box Letter
SCHEDULES
Schedule 1: List of Accounts
Schedule 2: Collection Account
Schedule 3: Fees and Charges included in Receivables
Schedule 4: List of Lock Box Banks
AMENDED AND RESTATED MASTER POOLING AND SERVICING AGREEMENT,
dated as of April 16, 2004, among AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION, a Delaware corporation, AMERICAN EXPRESS CENTURION BANK, a
Utah-chartered industrial loan company, and AMERICAN EXPRESS BANK, FSB, a
federally-chartered savings bank, as Transferors, and AMERICAN EXPRESS TRAVEL
RELATED SERVICES COMPANY, INC., a corporation organized under the laws of the
State of New York, as Servicer, and THE BANK OF NEW YORK, a banking corporation
organized under the laws of New York, as Trustee.
WHEREAS, this Master Pooling and Servicing Agreement was
entered into as of June 30, 1992, among American Express Receivables Financing
Corporation, as Transferor, American Express Travel Related Services Company,
Inc., as Servicer, and The Bank of New York, as Trustee, and, prior to the
amendments contained herein, was most recently amended and restated as of May 1,
1998, and as amended and restated as of May 1, 1998, was among American Express
Centurion Bank and American Express Receivables Financing Corporation, as
Transferors, American Express Travel Related Services Company, Inc., as
Servicer, and The Bank of New York, as Trustee (together, the "Original Pooling
Agreement");
WHEREAS, the parties hereto wish to amend and restate the
Original Pooling Agreement in its entirety in order to, among other things,
provide for the addition of American Express Bank, FSB, a federally-chartered
savings bank, as a Transferor hereunder;
WHEREAS, to provide for the addition of American Express Bank,
FSB as a Transferor under this Agreement and for other purposes, the parties
hereto agree to and do hereby amend and restate the Original Pooling Agreement
as of April 16, 2004 to read in its entirety as set forth herein.
NOW, THEREFORE, for good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
agree, for the benefit of each other and for the benefit of the
Certificateholders and the Enhancement Providers, to amend and restate the
Original Pooling Agreement in its entirety to read as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. Whenever used in this Agreement, the
following words and phrases shall have the following meanings:
"Account" shall mean the portion of each charge account, the
full receivable balance of which is due upon receipt of a monthly billing
statement, established pursuant to an Account Agreement between an Account
Originator and any Person, and in each case identified by account number and by
the Receivable balance as of the Cut-Off Date or the applicable Additional
Account Cut-Off Date in each computer file or microfiche list delivered to the
Trustee by the Servicer on behalf of the Transferors on the Closing Date and
pursuant to Section 2.01 and Section 2.06, as applicable. The definition of
Account shall include any account or accounts (each, a "Related Account") having
the following characteristics: (a) (i) such Related Account was originated in
accordance with the Account Guidelines; (ii) the obligor with respect to such
Related Account is the same Person as the Obligor of the Account related to such
Related Account; (iii) such Related Account is originated as a result of the
card associated with an Account being lost or stolen or as a result of
conversions from one type of Account from or into another type of Account or as
a result of the consolidation of an Obligor's accounts with either of the
Account Originators into one account; and (iv) such Related Account can be
traced to, or identified with an Account identified by account number on the
computer file or microfiche list delivered to the Trustee pursuant to Section
2.01 or 2.06, by reference to or by way of the computer or other records of a
Transferor or (b) (i) such Related Account is an Account with respect to which a
new account number has been issued under circumstances not requiring standard
application and credit evaluation procedures under the Account Guidelines; and
(ii) such Related Account can be traced or identified as an account into which
an Account has been transferred by reference to or by way of the computer file
or microfiche list delivered to the Trustee pursuant to Sections 2.01 or 2.06.
The term "Account" shall be deemed to refer to an Additional Account only from
and after the Additional Account Closing Date with respect thereto, and the term
"Account" shall be deemed to refer to any Removed Account only prior to the
Removal Date with respect thereto.
1
"Account Agreement" shall mean, with respect to an Account,
the agreement between an Account Originator and the Obligor governing the terms
and conditions of such Account, as such agreement may be amended, modified or
otherwise changed from time to time.
"Account Guidelines" shall mean, with respect to the Accounts
of each Account Originator, the policies and procedures of such Account
Originator, relating to the operation of its consumer charge card businesses,
including, without limitation, the policies and procedures for determining the
creditworthiness of customers, the extension of privileges and relating to the
maintenance of accounts and collection of receivables, as such policies and
procedures may be amended from time to time.
"Account Originator" shall mean, with respect to an Account,
TRS, Centurion Bank, FSB or any other entity that, pursuant to the Account
Agreement related to such Account, is the issuer of the charge cards related to,
or the owner of, such Account; provided that the Transferors shall have received
written confirmation from Standard & Poor's that the designation of any Account
Originator other than TRS, Centurion Bank or FSB shall not cause the downgrade
or withdrawal of any rating assigned to any outstanding Series by Standard &
Poor's.
"Accumulation Period" with respect to any Series, the period
following the Revolving Period which shall be the Controlled Accumulation Period
or the Early Accumulation Period (each as defined in the related Supplement).
"Additional Account Closing Date" shall mean each date on
which Additional Accounts will be included as Accounts pursuant to Section 2.06.
"Additional Account Cut-Off Date" shall mean, with respect to
any Additional Account, the last day of the Due Period preceding the Additional
Account Closing Date.
2
"Additional Account Selection Date" shall have the meaning set
forth in Section 2.06.
"Additional Accounts" shall have the meaning set forth in
Section 2.06.
"Adjustment Payment" shall have the meaning specified in
Section 3.08(a).
"Affiliate" of any Person shall mean any other Person directly
or indirectly controlling, controlled by or under common control with such
Person.
"Aggregate Invested Amount" shall mean with respect to any
date of determination the sum of the Invested Amounts with respect to all Series
of Investor Certificates then outstanding.
"Aggregate Invested Percentage" shall mean with respect to any
date of determination the sum of the applicable Invested Percentages with
respect to all Series of Investor Certificates then outstanding.
"Agreement" shall mean the Original Pooling Agreement, as (i)
with respect to each Series, supplemented by each related Supplement and (ii)
further amended by this Amended and Restated Master Pooling and Servicing
Agreement and as the same may be further amended, supplemented or otherwise
modified from time to time.
"Amortization Period" shall mean, with respect to any Series,
the period following the Revolving Period which shall be the Controlled
Amortization Period, Early Amortization Period or Rapid Amortization Period
(each as defined in any related Supplement).
"Annual Membership Fees" shall mean any annual fees specified
in the various Account Agreements as they may from time to time be amended.
"Applicants" shall have the meaning specified in Section 6.07.
"Appointment Day" shall have the meaning specified in Section
9.02.
"Authorized Newspaper" shall mean one or more newspapers of
general circulation in the Borough of Manhattan, The City of New York printed in
the English language and customarily published on each Business Day, whether or
not published on Saturdays, Sundays and holidays.
"Average Monthly Privileged Assets Billed Amount" shall mean
for any calendar month, the average amount billed for such month under the
Privileged Assets Program to all American Express Cardmembers who are enrolled
in the Privileged Assets Program, whether or not their related Accounts are
included in the Trust.
"Bearer Certificates" shall mean any certificates issued in
bearer form.
"Bearer Rules" shall mean the provisions of the Internal
Revenue Code, in effect from time to time, governing the treatment of bearer
obligations, including sections 163(f), 871, 881, 1441, 1442 and 4701, and any
regulations thereunder including, to the extent applicable to any Series
proposed or temporary regulations.
3
"Book-Entry Certificates" shall mean Investor Certificates
that are registered in the name of a Clearing Agency or a Foreign Clearing
Agency, or the nominee of either such entity, ownership and transfers of which
shall be evidenced or made through book entries by such Clearing Agency or
Foreign Clearing Agency as described in Section 6.10; provided, that after the
occurrence of a condition whereupon book-entry registration and transfer are no
longer permitted and Definitive Certificates are issued to the Certificate
Owners, such Definitive Certificates shall replace Book-Entry Certificates.
"Business Day" shall mean (i) any day other than (a) a
Saturday or Sunday or (b) any other day on which national banking associations,
federal savings banks or state banking institutions in New York, New York, or
any other State in which the principal executive offices of RFC, Centurion Bank,
FSB, the Trustee, or any Account Owner, as the case may be, are located, are
authorized or obligated by law, executive order or governmental decree to be
closed or (c) for purposes of any particular Series, any other day specified in
the applicable Supplement and (ii) with respect to the determination of LIBOR, a
London Business Day (as such term is defined in the related Supplement).
"Cardmember" shall mean the Obligor of an American Express
Card account.
"Centurion Bank" shall mean American Express Centurion Bank, a
Utah-chartered industrial loan company, and its successors and permitted
assigns.
"Certificate" shall mean one of any Series of the Investor
Certificates or the Exchangeable Transferor Certificates.
"Certificateholder" or "Holder" shall mean the Person in whose
name a Certificate is registered in the Certificate Register.
"Certificate Interest" shall mean interest payable with
respect to the applicable Series of Investor Certificates pursuant to Section
4.06.
"Certificate Owner" shall mean, with respect to a Book-Entry
Certificate, the Person who is the owner of a security entitlement with respect
to such Book-Entry Certificate, as reflected on the books of the Clearing
Agency, or on the books of a Person maintaining an account with such Clearing
Agency (directly or as an indirect participant, in accordance with the rules of
such Clearing Agency).
"Certificate Principal" shall mean principal payable with
respect to the applicable Series of Investor Certificates pursuant to the
applicable Supplement.
"Certificate Rate" shall mean, with respect to any Series of
Certificates, the percentage (or formula on the basis of which such rate shall
be determined) stated in the applicable Supplement; provided that, unless
otherwise provided in the applicable Supplement, in each case such rate shall be
calculated on the basis of a 360-day year consisting of twelve 30-day months.
4
"Certificate Register" shall mean the register maintained
pursuant to Section 6.03, providing for the registration of the applicable
Certificates and transfers and exchanges thereof.
"Clearing Agency" shall mean an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended, or any successor provision thereto.
"Clearing Agency Participant" shall mean a broker, dealer,
bank, other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities deposited
with the Clearing Agency.
"Clearstream" shall mean Clearstream Bank, societe anonyme, a
professional depository incorporated under the laws of Luxembourg, and any
successor thereto.
"Closing Date" shall mean, with respect to any Series, the
date of issuance of such Series of Certificates, as specified in the related
Supplement.
"Collection Account" shall have the meaning specified in
Section 4.01.
"Collections" shall mean all payments (excluding Recoveries)
received by the Servicer with respect to the Receivables, in the form of cash,
checks, wire transfers, ATM transfers or other form of payment in accordance
with the related Account Agreement in effect from time to time on any
Receivable.
"Common Depositary" shall mean the Person appointed as such as
specified in the related Supplement, in its capacity as common depositary for
the respective accounts of a Foreign Clearing Agency. "Controlled Accumulation
Period" with respect to any Series, shall have the meaning specified in the
applicable Supplement.
"Controlled Amortization Period" with respect to any Series,
shall have the meaning specified in the applicable Supplement.
"Conveyance" shall have the meaning set forth in Section 7.05.
"Corporate Trust Office" shall mean the principal office of
the Trustee in The City of New York at which at any particular time its
corporate business shall be administered, which office at the date of the
execution of this Agreement is located at ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ 8 West, New
York, New York 10286, Attention: Corporate Trust Department - Attn: Asset Backed
Finance Unit.
"CRC" shall mean Credco Receivables Corp., a Delaware
corporation, and its successors.
"Cut-Off Date" shall mean, for each Account, other than
Additional Accounts, the close of business on June 30, 1992.
5
"Date of Processing" shall mean, with respect to any
transaction, the Business Day after such transaction is first output in written
form under the Servicer's customary and usual servicing practices, from the
Servicer's computer file of Accounts (without regard to the effective date of
such recordation).
"Default Amount" shall mean, for any Due Period, the product
of (a) the amount of the Receivables in all Accounts which became Defaulted
Accounts during such Due Period at the time such Accounts became Defaulted
Accounts plus any Receivables created in such Due Period on Defaulted Accounts
minus Recoveries, if any, received in such Due Period and (b) one minus the
Yield Factor.
"Defaulted Account" shall mean each Account with respect to
which, in accordance with the Account Guidelines pursuant to which such Account
is governed or the customary and usual servicing procedures of the Servicer for
servicing receivables comparable to the Receivables, the Servicer has charged
off the Receivables in such Account as uncollectible; in any event, an Account
shall be deemed a Defaulted Account no later than when such Account becomes 360
days past due from the date of the initial billing statement. Notwithstanding
any other provision hereof, any Receivables in a Defaulted Account which are
Ineligible Receivables shall be treated as Ineligible Receivables rather than
Receivables in Defaulted Accounts.
"Definitive Certificates" shall have the meaning specified in
Section 6.11.
"Definitive Euro-Certificates" shall have the meaning
specified in Section 6.10.
"Depository Agreement" shall mean the agreement among the
Transferors, the Trustee and the initial Clearing Agency substantially in the
form attached hereto as Exhibit J.
"Determination Date" shall mean, unless otherwise specified in
the Supplement for a particular Series, the earlier of the third Business Day
and the fifth calendar day (or if the fifth calendar day is not a Business Day,
then the preceding Business Day) preceding each Distribution Date.
"Distribution Date" shall mean, with respect to any Series of
Certificates, the date specified in the applicable Supplement.
"Due Period" shall mean, unless otherwise provided in a
Supplement, with respect to each Distribution Date, (i) prior to and including
the May 1998 Distribution Date, the period from and including the first day of
the immediately preceding calendar month and ending at the close of business on
the last day of such calendar month, (ii) for the June 1998 Distribution Date,
the period from and including May 1, 1998 to and including May 27, 1998, and
(iii) commencing with the July 1998 Distribution Date, the period (a) from and
including the second day following the last day of the eighth billing cycle
applicable to the Accounts ending during the second preceding calendar month (b)
to and including the day following the last day of the eighth billing cycle
applicable to the Accounts ending in the calendar month immediately preceding
the month in which such Distribution Date shall occur; provided, however, that
the initial Due Period with respect to any Series will commence on the Closing
Date with respect to such Series.
6
"Early Accumulation Period" with respect to any Series, shall
have the meaning specified in the applicable Supplement.
"Early Amortization Event" with respect to any Series issued
prior to May 1, 1998, shall have the same meaning as the meaning specified in
Section 9.01 for the term "Pay Out Event".
"Early Amortization Period" with respect to any Series, shall
have the meaning specified in the applicable Supplement.
"Eligible Account" shall mean each Account which as of the
Selection Date (or, with respect to Additional Accounts, as of the relevant
Additional Account Selection Date) (i) is an Account and was in existence and
owned by an Account Originator at the close of business on the Selection Date
(or, with respect to Additional Accounts, as of the relevant Additional Account
Selection Date) and whose billed balance is payable in full each month, (ii) is
payable in United States dollars, (iii) is not classified by such Account
Originator as fraudulent, (iv) the card or cards related to which have not been
reported lost or stolen, (v) was created or purchased in accordance with or
under underwriting and credit standards no less stringent than those generally
applied by such Account Originator, (vi) has not been identified by such Account
Originator in its computer files as having a deceased Obligor or having been
cancelled due to the Obligor's bankruptcy or insolvency, (vii) is not classified
by such Account Originator as having been charged off, (viii) the Obligor of
which is a natural person and (ix) has not been identified by such Account
Originator as having been charged off.
Notwithstanding the foregoing, with respect to Additional
Accounts, Eligible Accounts may include Accounts, the Receivables of which have
been written off, or with respect to which the Servicer believes the related
Obligor is bankrupt or insolvent, in each case as of the related Additional
Account Selection Date and/or Additional Account Cut-Off Date; provided that (a)
the balance of all Receivables included in such Accounts is reflected on the
books and records of the related Account Originator (and is treated for purposes
of this Agreement) as "zero", and (b) charging privileges with respect to all
such Accounts have been cancelled in accordance with the Account Guidelines
applicable thereto.
"Eligible Institution" shall mean a depositary institution,
which may include the Trustee, organized under the laws of the United States or
any one of the States thereof including the District of Columbia, the deposits
in which are insured by the FDIC and which at all times has a short-term
unsecured debt rating of at least A-l+ or P-1 by the applicable Rating Agency;
provided, however, that an institution which shall have corporate trust powers
and which maintains the Collection Account, any principal funding account, any
interest funding account or any other account maintained for the benefit of
Certificateholders as a fully segregated trust account with the trust department
of such institution shall not be required to meet the foregoing rating
requirements, and need only at all times have a long-term unsecured debt rating
of at least Baa3 by Moody's so long as ▇▇▇▇▇'▇ is a Rating Agency.
7
"Eligible Investments" shall mean (a) negotiable instruments
or investment property which evidence (i) obligations fully guaranteed by the
United States of America; (ii) time deposits in, or bankers acceptances issued
by, any depositary institution or trust company incorporated under the laws of
the United States of America or any state thereof and subject to supervision and
examination by Federal or state banking or depositary institution authorities,
provided, however, that at the time of the Trust's investment or contractual
commitment to invest therein, the certificates of deposit or short-term
deposits, if any, or long-term unsecured debt obligations (other than such
obligation whose rating is based on collateral or on the credit of a Person
other than such institution or trust company) of such depositary institution or
trust company shall have a credit rating from Moody's and Standard & Poor's of
P-1 and A-l+, respectively, in the case of the certificates of deposit or
short-term deposits, or a rating not lower than one of the two highest
investment categories granted by Moody's and AAA by Standard & Poor's in the
case of long-term unsecured debt obligations; (iii) certificates of deposit
having, at the time of the Trust's investment or contractual commitment to
invest therein, a rating from Moody's and Standard & Poor's of P-1 and A-l+
respectively; (iv) investments in money market funds rated in the highest
investment category (in case of Standard & Poor's, such rating category being
AAAm or AAAm-G) or otherwise approved in writing by the applicable Rating
Agencies, (b) demand deposits in the name of the Trust or the Trustee on behalf
of the Trust in any depositary institution or trust company referred to in
(a)(ii) above, (c) commercial paper (having original or remaining maturities of
no more than 270 days) having, at the time of the Trust's investment or
contractual commitment to invest therein, a credit rating from Moody's and
Standard & Poor's of P-1 and A-l+, respectively, (d) Eurodollar time deposits
having a credit rating from Moody's and Standard & Poor's of P-1 and A-1+,
respectively, and (e) repurchase agreements involving any of the Eligible
Investments described in clauses (a)(i), (a)(iii) and (d) hereof so long as the
other party to the repurchase agreement has at the time of the Trust's
investment therein a rating from Moody's and Standard & Poor's of P-1 and A-1+,
respectively.
"Eligible Receivable" shall mean each Receivable:
(i) which has arisen under an Eligible Account;
(ii) which was created in compliance with all requirements of
law and pursuant to an agreement which complies with all requirements
of law in either case the failure to comply with which would have a
material adverse effect upon Certificateholders;
(iii) with respect to which all material consents, licenses,
approvals or authorizations of, or registrations with, any governmental
authority required to be obtained or given by an Account Originator in
connection with the creation of such Receivable or the execution,
delivery and performance by such Account Originator of the related
agreement have been duly obtained or given and are in full force and
effect as of such date of creation;
(iv) as to which at the time of the transfer of such
Receivable to the Trust, the Trust will have good and marketable title,
free and clear of all liens, encumbrances, charges and security
interests (except those permitted by subsection 2.05(b));
(v) which has been the subject of either a valid transfer and
assignment from a Transferor to the Trust of all of such Transferor's
right, title and interest therein or the grant of a first priority
perfected security interest therein (and in the proceeds thereof to the
extent set forth in the UCC as in effect in the Relevant UCC State),
effective until the termination of the Trust;
8
(vi) which is the legal, valid and binding payment obligation
of the Obligor thereof enforceable against such Obligor in accordance
with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws, now or hereafter in effect, affecting the enforcement of
creditors' rights in general and except as such enforceability may be
limited by general principles of equity (whether considered in a suit
at law or in equity);
(vii) which constitutes either an "account" or a "general
intangible" under and as defined in Article 9 of the UCC as then in
effect in the Relevant UCC State;
(viii) which, at the time of its transfer to the Trust, has
not been waived or modified except as permitted hereunder;
(ix) which is not subject to any right of rescission, setoff,
counterclaim or other defense (including the defense of usury), other
than defenses arising out of applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights in general;
(x) as to which the related Account Originator and Transferors
have satisfied all obligations to be fulfilled at the time it is
transferred to the Trust; and
(xi) as to which no Account Originator or Transferor has done
anything, at the time of its transfer to the Trust, to impair the
rights of the Trust or Certificateholders therein.
"Enhancement" shall mean, with respect to any Series or class
of Certificates within a Series, any letter of credit, guaranteed rate
agreement, maturity guaranty facility, cash collateral account, cash collateral
guaranty, tax protection agreement, interest rate swap, interest rate cap or
other contract or agreement for the benefit of Certificateholders of such Series
or class, as applicable.
"Enhancement Provider" shall mean, with respect to any Series,
that Person designated as such in the applicable Supplement.
"Estimated Trust Privileged Assets Billed Amounts" shall mean,
for any calendar month, the product of (i) the number of Accounts that were
enrolled in the Privileged Assets Program at the end of such calendar month,
(ii) the Average Monthly Privileged Assets Billed Amount for such month and
(iii) 1.25; provided, that if the Servicer has modified its computer programs
such that it can determine the actual Privileged Assets Billed Amounts billed
with respect to the Accounts, such actual amounts shall constitute the Estimated
Trust Privileged Assets Billed Amounts.
"Euro-Certificate Exchange Date" shall mean with respect to
any Series, the date specified in the applicable Supplement.
9
"Euroclear Operator" shall mean Euroclear Bank S.A./N.V., as
operator of the Euroclear System, or any successor thereto.
"Excess Allocation Series" shall mean any Series that,
pursuant to the Supplement related to such Series, is entitled to receive
certain excess Yield Collections as more fully described in such Supplement.
"Excess Principal Collections" shall mean, with respect to a
Distribution Date, the aggregate amount for all outstanding Series of Principal
Collections which the related Supplements specify are to be treated as "Excess
Principal Collections" for such Distribution Date.
"Exchange" shall mean the procedure described under Section
6.09.
"Exchangeable Transferor Certificate" shall mean the
certificate executed by the Transferors and authenticated by the Trustee,
substantially in the form of Exhibit A and exchangeable as provided in Section
6.09 for one or more Series of Investor Certificates and the reissued
Exchangeable Transferor Certificate.
"Exchange Date" shall have the meaning, with respect to any
Series issued pursuant to an Exchange, specified in Section 6.09.
"Exchange Notice" shall have the meaning, with respect to any
Series issued pursuant to an Exchange, specified in Section 6.09.
"FDC" shall mean First Data Corporation, a Delaware
corporation, or any of its subsidiaries.
"FDIC" shall mean the Federal Deposit Insurance Corporation,
or any successor thereto.
"Final Termination Date" shall have the meaning specified in
subsection 12.01(a).
"Foreign Clearing Agency" shall mean with respect to any
Series, Clearstream or the Euroclear Operator or any other established clearing
agency for securities outside the United States designated in the applicable
Supplement.
"FSB" shall mean American Express Bank, FSB, a
federally-chartered savings bank, and its successors and permitted assigns.
"Global Certificate" shall have the meaning set forth in
subsection 6.10(a).
"Governmental Authority" shall mean the United States of
America, any state or other political subdivision thereof and any United States
entity exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"Ineligible Receivable" shall have the meaning specified in
subsection 2.04(d).
10
"Initial Closing Date" shall mean August 3, 1992.
"Initial Invested Amount" shall mean, with respect to any
Series, the amount stated in the applicable Supplement.
"Internal Revenue Code" shall mean the Internal Revenue Code
of 1986, as amended from time to time.
"Invested Amount" shall mean, with respect to any Series, the
meaning specified in the applicable Supplement.
"Invested Percentage" shall have, with respect to each Series,
the meaning set forth in the applicable Supplement.
"Investor Certificate" shall mean any one of the certificates
executed by (i) prior to May 1, 1998, the Transferor or (ii) after May 1, 1998,
the Transferors and, in each case, authenticated by the Trustee and
substantially in the form attached to the applicable Supplement.
"Investor Certificateholder" shall mean the holder of record
of an Investor Certificate.
"Investor Charge-Offs" shall have, with respect to each
Series, the meaning specified in the applicable Supplement.
"Investor Default Amount" shall mean, with respect to each
Series for any Due Period, an amount equal to the product of (a) the Default
Amount and (b) the related Floating Allocation Percentage for such Due Period.
"Investor Monthly Servicing Fee" shall have, with respect to
each Series, the meaning specified in Section 3.02.
"Lien" shall mean any security interest, mortgage, deed of
trust, pledge, hypothecation, assignment, participation, deposit arrangement,
encumbrance, lien (statutory or other), preference, priority right or interest
or other security agreement or preferential arrangement of any kind or nature
whatsoever, including, without limitation, any conditional sale or other title
retention agreement, any financing lease having substantially the same economic
effect as any of the foregoing; provided, however, that any assignment pursuant
to Section 7.02 hereof and the lien created by this Agreement, the Original
Pooling Agreement or any Receivables Purchase Agreement shall not be deemed to
constitute a Lien.
"Lock Box Letters" shall mean such letters, in substantially
the form of Exhibit K hereto, delivered by TRS as Servicer to the Trustee
pursuant to Section 3.09 hereof.
"Manager" shall mean the managing underwriter of any Series.
"Minimum Transferor Percentage" shall mean, with respect to
any Due Period with respect to any Series, the percentage specified in the
applicable Supplement.
11
"Minimum Trust Principal Component" shall mean the aggregate
of the amounts set forth in each Supplement for each outstanding Series as the
"Minimum Trust Principal Component" for such Series.
"Monthly Servicing Fee" shall have the meaning specified in
Section 3.02.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc.
"Obligor" shall mean, with respect to any Account, the Person
or Persons obligated to make payments with respect to such Account, including
any guarantor thereof.
"Officer's Certificate" shall mean a certificate signed by any
Vice President or more senior officer of a Transferor or the Servicer and
delivered to the Trustee.
"Opinion of Counsel" shall mean a written opinion of
independent counsel, who may be counsel for either of the Transferors, and which
shall be reasonably acceptable to the Trustee.
"Original Pooling Agreement" shall have the meaning specified
in the recitals to this Agreement.
"PA Removal Date" means the Determination Date on which
designated Accounts are removed pursuant to subsection 2.07(c).
"Paying Agent" shall mean any paying agent appointed pursuant
to Section 6.06 and shall initially be the Trustee.
"Payment Service Centers" shall mean the service centers
operated by TRS for the purpose of receiving and processing Cardmember
remittances in respect of Accounts, currently located in Chicago, Illinois and
any additional service centers operated by TRS or any agent of TRS from time to
time. TRS agrees to provide prompt notice to the Trustee of any additional
Payment Service Centers.
"Pay Out Event" shall have, with respect to each Series, the
meaning specified in Section 9.01.
"Permitted Activities" means the primary activities of the
Trust, which are:
(a) holding Receivables transferred from the Transferors and
the other assets of the Trust, including passive derivative financial
instruments that pertain to beneficial interests issued or sold to parties other
than the Transferors, their Affiliates or their agents;
(b) issuing Certificates and other interests in the Trust
Property;
(c) receiving Collections and making payments on such
Certificates and interests in accordance with the terms of this Agreement and
any Supplement; and
12
(d) engaging in other activities that are necessary or
incidental to accomplish these limited purposes, which activities cannot be
contrary to the status of the Trust as a qualified special purpose entity under
existing accounting literature.
"Person" shall mean any person or entity, including any
individual, corporation, partnership, joint venture, association, joint-stock
company, trust, unincorporated organization, Governmental Authority or other
entity of similar nature.
"Principal Collections" shall mean Collections other than
Yield Collections.
"Principal Funding Account" with respect to any Series, shall
have the meaning specified in the applicable Supplement.
"Principal Funding Account" shall have, with respect to each
Series, the meaning, if any, specified in the applicable Supplement.
"Principal Shortfalls" shall mean, with respect to a
Distribution Date, the aggregate amount for all outstanding Series which the
related Supplements specify are "Principal Shortfalls" for such Distribution
Date.
"Principal Terms" shall have the meaning, with respect to any
Series issued pursuant to an Exchange, specified in Section 6.09.
"Privileged Assets Applied Dilution Factor" for a Due Period
shall mean the percentage equal to (i) the highest Privileged Assets Monthly
Dilution Rate for the rolling 12 month period ending with the calendar month in
which the last day of such Due Period occurs plus (ii) the product of the
Standard Deviation Factor and 3. The Standard Deviation Factor shall mean the
square root of the result of (a) the sum of the square of the differences
between the Privileged Assets Monthly Dilution Rate for each month occurring in
such 12 month period and the average Privileged Assets Monthly Dilution Rate for
such 12 month period divided by (b) 12.
"Privileged Assets Billed Amounts" shall mean amounts billed
under the Privileged Assets Program to Cardmembers enrolled in such Program.
"Privileged Assets Calculated Amount" shall mean, for a Due
Period, the product of (i) one minus the Yield Factor, (ii) the Estimated Trust
Privileged Assets Billed Amounts for the calendar month in which the last day of
the preceding Due Period occurs and (iii) the Privileged Assets Applied Dilution
Factor for such preceding Due Period.
"Privileged Assets Monthly Dilution Rate" for a calendar month
shall mean one minus the Privileged Assets Monthly Payment Rate for such month;
provided, that for this purpose the Privileged Assets Monthly Payment Rate shall
be capped at 100%.
"Privileged Assets Monthly Payment Rate" for a calendar month
shall be calculated by dividing the total remittances received under the entire
Privileged Assets Program during such calendar month by the total Privileged
Assets Billed Amounts for the prior month.
13
"Privileged Assets Program" shall mean the program offered by
an Account Originator in conjunction with one or more of its affiliated
insurance subsidiaries, currently called "Privileged Assets", pursuant to which
Cardmembers who enter into an annuity contract with the insurance affiliate can
choose a monthly contribution amount, which amount is billed to their American
Express(R) Card, American Express(R) Gold Card or Platinum Card(R) Accounts.
Payment of such billed contribution amounts is voluntary.
"Rapid Amortization Period" with respect to any Series, shall
have the meaning specified in the applicable Supplement.
"Rating Agency" shall mean, with respect to any Series, each
statistical rating agency or agencies selected by the Transferors to rate the
Investor Certificates of such Series.
"Receivable" shall mean any amount owing by the Obligor under
an Account (including Defaulted Accounts), including any Related Account or
Additional Account, from time to time (including, without limitation, amounts
owing for the payment of merchandise and services and Annual Membership Fees)
and the administrative fees and charges described on Schedule 3 hereto). In
calculating the aggregate amount of Receivables on any day, the amount of
Receivables shall be reduced by the aggregate amount of credit balances, and
other adjustments stated in Section 3.08 hereof, in the Accounts on such day.
Any Receivables which the Transferor is unable to transfer as provided in
subsection 2.05(d) shall not be included in calculating the aggregate amount of
Receivables. For purposes of the computer file or microfiche list to be
delivered to the Trustee pursuant to Section 2.01 and 2.06, for purposes of
Schedule 1 to this Agreement and Schedule 1 to each Assignment of Receivables in
Additional Accounts in the form of Exhibit B to this Agreement and for purposes
of calculating the amount of the Receivables on any day, including without
limitation, in the reports to be delivered pursuant to Section 3.04(c), to
calculate the amount of Receivables transferred to the Trust and for purposes of
any calculation using the term "Receivables", the Privileged Assets Billed
Amounts may be treated in the same manner as Receivables and included in all
such calculations and reports, subject to the requirements provided in the
definition of "Trust Principal Component" and Section 2.07(c). Privileged Assets
Billed Amounts shall not constitute Receivables but shall be treated as
aforesaid, and the Transferor and Servicer representations and warranties shall
not apply to the Privileged Assets Billed Amounts. Receivables in a Defaulted
Account will cease to be included as Receivables at such time as they are sold
as part of the Servicer's collection efforts.
"Receivable Purchase Agreement" shall mean (i) the receivable
purchase agreement, dated as of June 30, 1992, between RFC, as purchaser, and
TRS, as seller, and (ii) any other receivable purchase agreement substantially
in the form of such agreement that may be entered into by RFC, Centurion, FSB or
any other Transferor and an Account Originator in the future, pursuant to which
RFC, Centurion, FSB or such other Transferor will acquire from such Account
Originator Receivables for transfer, directly or indirectly, to the Trust, in
each case as the same may be amended, supplemented or otherwise modified from
time to time; provided that the Transferors shall have received written
confirmation from Standard & Poor's that such other receivable purchase
agreement shall not cause the downgrade or withdrawal of any rating assigned to
any outstanding Series by Standard & Poor's.
14
"Record Date" shall mean, unless otherwise specified with
respect to a Series in the applicable Supplement, with respect to any
Distribution Date, the last Business Day of the immediately preceding calendar
month.
"Recoveries" shall mean all amounts received with respect to
Receivables in Defaulted Accounts, net of expenses allocable thereto, including
the net proceeds of any sale of such Receivables.
"Related Account" shall have the meaning specified for such
term contained in the definition of the term "Account" herein.
"Relevant UCC State" shall mean all jurisdictions where UCC
filing is required to perfect and maintain the security interest of the Trustee.
"Remittance Banks" shall mean the institutions holding
accounts into which TRS shall deposit payments received through the Payment
Service Centers from Cardmembers in respect of Accounts.
"Removal Date" shall mean the date on which the Receivables in
certain designated Removed Accounts will be reassigned by the Trustee to a
Transferor.
"Removal Notice Date" shall mean the tenth Business Day prior
to a Removal Date.
"Removed Accounts" shall have the meaning set forth in Section
2.07.
"Removed PA Accounts" means the Accounts that are designated
for deletion and removal on the PA Removal Date pursuant to subsection 2.07(c)
"Repurchase Terms" shall mean, with respect to any Series
issued pursuant to an Exchange, the terms and conditions under which the
Transferors may repurchase such Series of Certificates pursuant to Section
12.02.
"Requirements of Law" for any Person shall mean the
certificate of incorporation or articles of association and by-laws or other
organizational or governing documents of such Person, and any law, treaty, rule
or regulation, or determination of an arbitrator or Governmental Authority, in
each case applicable to or binding upon such Person or to which such Person is
subject, whether Federal, state or local (including, without limitation, usury
laws, the Federal Truth in Lending Act and Regulation Z and Regulation B of the
Board of Governors of the Federal Reserve System).
"Responsible Officer" shall mean any officer of the Trustee
assigned by it to administer its corporate trust matters.
"Revolving Period" shall mean, with respect to each Series,
the period from and including the date of initial issuance of the Investor
Certificates of such Series to, but not including, the day on which an
Amortization Period or an Accumulation Period for such Series commences.
15
"RFC" shall mean American Express Receivables Financing
Corporation, a Delaware corporation, and its successors.
"Selection Date" shall mean, for each Account, other than
Additional Accounts, the close of business on the cycle billing date for such
Account occurring in the monthly period beginning on the close of business on
March 1, 1992 and ending at the close of business on March 31, 1992.
"Series" shall mean any Series of Investor Certificates, each
as designated in the applicable Supplement.
"Series Factor" shall mean, unless any Series is issued in
more than one class as stated in any related Supplement with respect to any
Series and any Due Period, a number carried out to eight decimals (and rounded
to seven decimals) representing the ratio of the applicable Invested Amount as
of the end of the last day of the preceding Due Period to the applicable Initial
Invested Amount.
"Servicer" shall mean initially TRS and thereafter any Person
appointed as successor as herein provided to service the Receivables.
"Servicer Default" shall have the meaning specified in Section
10.01.
"Service Transfer" shall have the meaning specified in Section
10.01.
"Servicing Fee Percentage" shall mean, with respect to any
Series, the percentage specified in the applicable Supplement.
"Servicing Officer" shall mean any officer of the Servicer
involved in, or responsible for, the administration and servicing of the
Receivables whose name appears on a list of servicing officers furnished to the
Trustee by the Servicer, as such list may from time to time be amended.
"Special Funding Account" shall have the meaning set forth in
Section 4.01.
"Standard & Poor's" shall mean Standard & Poor's, a division
of the ▇▇▇▇▇▇-▇▇▇▇ Company, or any successor thereto.
"Stated Series Termination Date" shall mean, with respect to
any Series, the date stated in the applicable Supplement as the termination date
for such Series.
"Successor Servicer" shall have the meaning specified in
Section 10.02.
"Supplement" shall mean, with respect to any Series, a
supplement to this Agreement complying with the terms of Section 6.09, executed
in conjunction with any issuance of any Series.
"Termination Notice" shall have, with respect to any Series,
the meaning specified in Section 10.01.
16
"Transferee's Certificate" shall have the meaning set forth in
Section 7.05.
"Transfer Agent and Registrar" shall have the meaning
specified in Section 6.03 and shall initially be the Trustee.
"Transferor Amount" shall mean, on any date of determination,
the Trust Principal Component at the end of the day immediately prior to such
date of determination, minus the Aggregate Invested Amount at the end of such
day and plus the principal amount on deposit in the Special Funding Account and
in any principal funding account at the end of such day.
"Transferor Interest" shall have the meaning specified in
Section 4.01(a).
"Transferor Percentage" shall mean, on any date of
determination, when used with respect to Principal Collections, Yield
Collections and Receivables in Defaulted Accounts or otherwise, one hundred
percent minus the sum for all Outstanding Series of the Invested Percentages
calculated on such date with respect to such categories of Receivables as
calculated by the Servicer.
"Transferor" shall mean any of RFC, Centurion Bank or FSB, in
each case, as a transferor of Receivables. References to "each Transferor" shall
refer to each entity mentioned in the preceding sentence and, whenever the
context may so require, references to "the Transferor" shall refer,
collectively, to all of such entities.
"TRS" shall mean American Express Travel Related Services
Company, Inc., a New York corporation, and its successors and assigns.
"Trust" shall mean the trust heretofore created and continued
by this Agreement, the corpus of which shall consist of the Trust Property.
"Trust Average Monthly Payment Rate" for a Due Period means
Collections on Receivables, excluding Recoveries for such Due period, divided by
the aggregate amount of billed Receivables as of the beginning of such Due
Period.
"Trustee" shall mean the institution executing this Agreement
as trustee, or its successor in interest, or any successor trustee appointed as
herein provided.
"Trust Principal Component" shall mean, for any Due Period,
the product of the aggregate amount of Receivables at the end of the prior Due
Period and one minus the Yield Factor or, for any other date of determination,
the product of the aggregate amount of Receivables as of the date so specified
in this Agreement and one minus the Yield Factor; provided, however, that there
shall be subtracted from each such product the Privileged Assets Calculated
Amount for the prior Due Period for the purpose of calculating (A) the
Transferor Amount as a percentage of the Trust Principal Component pursuant to
Section 2.06(a)(1), (B) the Trust Principal Component pursuant to Section
2.06(a)(2), (C) the Transferor Amount as a percentage of the Trust Principal
Component pursuant to Section 2.07(a) and 2.07(b)(iii), (D) the Trust Principal
Component and the Transferor Amount as a percentage of the Trust Principal
Component pursuant to Section 2.07(c), (E) the Transferor Amount as a percentage
of the Trust Principal Component pursuant to the fourth sentence of Section
3.08(a), (F) the Transferor Amount as a percentage of the Trust Principal
Component pursuant to Section 4.01(f), (G) the Trust Principal Component
pursuant to Section 6.09(b), (H) the Transferor Amount as a percentage of the
Trust Principal Component pursuant to Section 9.01(d) and (I) any amount for any
other purpose with respect to a Series as specified in the related Supplement.
17
"Trust Property" shall have the meaning specified in Section
2.01.
"UCC" shall mean the Uniform Commercial Code, as amended from
time to time, as in effect in any specified jurisdiction.
"Undistributed Principal Collections" shall have the meaning
specified in subsection 4.01(f).
"Undivided Interest" shall mean the undivided interest of any
Certificateholder in the Trust.
"Yield Collections" shall mean an amount equal to Collections
received with respect to each Account multiplied by the Yield Factor.
"Yield Factor" shall mean, initially, 3.0% and thereafter such
amount as is determined pursuant to subsection 2.05(g).
Section 1.02 Other Definitional Provisions.
(a) All terms defined in any Supplement or this Agreement
shall have the defined meanings when used in any certificate or other document
made or delivered pursuant hereto unless otherwise defined therein. The
definitions of all terms defined herein shall include the singular as well as
the plural form of such terms and the masculine of such terms as well as the
feminine and neuter genders of such terms.
(b) As used herein and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
Section 1.01, and accounting terms partly defined in Section 1.01 to the extent
not defined, shall have the respective meanings given to them under generally
accepted accounting principles on the date of determination. To the extent that
the definitions of accounting terms herein are inconsistent with the meanings of
such terms under generally accepted accounting principles, the definitions
contained herein shall control.
(c) The agreements and representations and warranties of RFC,
Centurion Bank, FSB and TRS in this Agreement in each of their respective
capacities as Transferor and Servicer, shall be deemed to be the agreements,
representations and warranties of RFC, Centurion Bank, FSB and TRS solely in
each such capacity for so long as RFC, Centurion Bank, FSB and TRS shall act in
each such capacity under this Agreement.
(d) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to any Supplement or this
Agreement as a whole and not to any particular provision of such Supplement or
this Agreement, as the case may be; Section, subsection, Schedule and Exhibit
references contained in this Agreement or any Supplement are references to
Sections, subsections, Schedules and Exhibits in or to this Agreement or any
Supplement unless otherwise specified; and the word "including" means including
without limitation.
[END OF ARTICLE I]
18
ARTICLE II
APPOINTMENT OF TRUSTEE;
CONVEYANCE OF RECEIVABLES
ISSUANCE OF CERTIFICATES
Section 2.01 Appointment of Trustee; Conveyance of Receivables. (a) The
Transferors have appointed and authorized The Bank of New York to act as Trustee
as provided herein and to exercise such powers under this Agreement as are
delegated to the Trustee by the terms hereof together with all such powers as
are reasonably incidental thereto. The Trustee has agreed to act, and has acted,
as the Trustee under the Original Pooling Agreement, and the Trustee hereby
agrees to act as Trustee under this Agreement. The Trustee further agrees to
exercise such powers and perform such functions on behalf of the
Certificateholders from time to time as are specifically delegated to the
Trustee by the terms hereof.
(b) Each Transferor does hereby transfer, assign, set over,
and otherwise convey to the Trustee, for the benefit of the Certificateholders,
without recourse, all of its right, title and interest in and to the
Receivables, now existing and hereafter created, all monies due or to become due
with respect thereto (including Recoveries) on and after the Cut-Off Date, and
all proceeds of such Receivables. Each Transferor does hereby further transfer,
assign, set over and otherwise convey to the Trustee, all of its rights,
remedies, powers, privileges and claims under or with respect to any related
Receivable Purchase Agreement (whether arising pursuant to the terms of such
Receivable Purchase Agreement or otherwise). Such property, together with all
monies as are from time to time deposited in the Collection Account, the Special
Funding Account and any other account or accounts maintained for the benefit of
the Certificateholders and all monies as are from time to time available under
any Enhancement for any Series for payment to Certificateholders shall
constitute the property of the Trust (the "Trust Property"). The foregoing
transfers, assignments, set-overs and conveyances do not constitute and are not
intended to result in a creation or an assumption by the Trust, the Trustee or
any Certificateholder of any obligation of the Servicer, any Transferor or any
other Person in connection with the Accounts, the Receivables or under any
agreement or instrument relating thereto including, without limitation, any
obligation to any Obligors, merchant service establishments or insurers.
In connection with such transfer, each Transferor agrees to
record and file, at its own expense, financing statements (and amendments
thereto when applicable) with respect to the Trust Property conveyed by such
Transferor meeting the requirements of applicable state law in such manner and
in such jurisdictions as are necessary to perfect the transfer, assignment,
set-over or other conveyance of its interest in such Trust Property to the
Trustee, and to deliver a file-stamped copy of such financing statement or
amendment or other evidence of such filing to the Trustee on or prior to the
Closing Date.
19
In connection with such transfer, assignment, set-over or
other conveyance, the Servicer agrees, on behalf of the Transferors, at its own
expense, to indicate clearly and unambiguously in its computer files that the
Receivables created in connection with the Accounts have been transferred to the
Trustee pursuant to this Agreement for the benefit of the Certificateholders by
including in the securitization field of such computer files the code "A", "D",
"E" or "Q" or any other related code designations specified at the dates of
their designation as "Accounts" and, in the case of Additional Accounts, a
similar code designation that shall be specified in the Assignment related
thereto. On behalf of the Transferors, the Servicer further agrees to deliver to
the Trustee (a) a computer file or microfiche list containing a true and
complete list of all such Accounts, identified by account number and by
Receivables balance as of the Cut-Off Date or the applicable Additional Account
Cut-Off Date and (b) within twenty Business Days of any request by the Trustee,
a new computer file or microfiche list containing a true and complete list of
all Accounts identified as described in the preceding clause (a). Such files or
lists shall be marked as Schedule 1 to this Agreement, delivered to the Trustee
as confidential and proprietary, and are hereby incorporated into and made a
part of this Agreement. The Servicer agrees, on behalf of the Transferors, at
its own expense, by the end of the Due Period in which any Related Accounts have
been originated to indicate clearly and unambiguously in its computer files that
the Receivables created in connection with the Related Accounts have been
transferred to the Trustee pursuant to this Agreement for the benefit of the
Certificateholders.
Each Transferor hereby grants to the Trustee a first priority
perfected security interest in all of such Transferor's right, title and
interest in and to the Receivables, now existing and hereafter created, all
monies due or to become due with respect thereto on and after the Cut-Off Date
applicable to the Receivables conveyed to the Trustee by such Transferor
(including Recoveries), all proceeds of such Receivables, such funds as are from
time to time deposited in the Collection Account, the Special Funding Account
and any other account or accounts maintained for the benefit of
Certificateholders, and the benefits of any Enhancement for any Series for
payment to Certificateholders. Each Transferor does hereby further grant to the
Trustee a first priority perfected security interest in all of such Transferor's
rights, remedies, powers, privileges and claims under or with respect to any
related Receivable Purchase Agreement (whether arising pursuant to the terms of
such Receivable Purchase Agreement or otherwise). This Agreement shall
constitute a security agreement under applicable law.
Pursuant to the request of the Transferors, the Trustee has
caused Certificates in authorized denominations evidencing the entire interest
in the Trust to be duly authenticated and delivered to or upon the order of the
Transferor pursuant to Section 6.02.
Section 2.02 Acceptance by Trustee. (a) The Trustee hereby acknowledges
its acceptance, to the extent validly transferred, assigned, set over or
otherwise conveyed to the Trustee as provided in subsection 2.01(b) hereof, on
behalf of the Trust, of all right, title and interest previously held by each
Transferor in and to the Receivables, now existing and hereafter created, all
monies due or to become due with respect thereto on and after the Cut-Off Date
applicable to the Receivables conveyed to the Trustee by such Transferor
(including Recoveries), all proceeds of such Receivables, such funds as are from
time to time deposited in the Collection Account, the Special Funding Account,
and any other account or accounts maintained for the benefit of
Certificateholders, and benefits of any Enhancement for any Series and declares
that it shall hold such right, title and interest, upon the trust herein set
forth, and subject to the terms hereof for the benefit of all
Certificateholders. The Trustee further acknowledges that, prior to or
simultaneously with the execution and delivery of this Agreement, the Servicer
delivered to the Trustee, on behalf of the Transferors, the computer files or
microfiche lists represented by the Servicer to be the computer files or
microfiche lists described in the fourth paragraph of Section 2.01.
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(b) The Trustee hereby agrees not to disclose to any Person
(including any Certificateholder or Certificate Owner) any of the account
numbers or other information contained in the computer files or microfiche lists
delivered to the Trustee by the Servicer on behalf of the Transferors pursuant
to Sections 2.01 and 2.06, except as is required in connection with the
performance of its duties hereunder or in enforcing the rights of the
Certificateholders or to a successor Servicer appointed pursuant to Sections
8.05 or 10.02 or a successor Trustee appointed pursuant to Section 11.08. The
Trustee agrees to take such measures as shall be reasonably requested by the
Transferors to protect and maintain the security and confidentiality of such
information, and, in connection therewith, shall allow the Transferor or the
Servicer on behalf of the Transferor to inspect the Trustee's security and
confidentiality arrangements from time to time during normal business hours. The
Trustee shall provide the Transferors with written notice five Business Days
prior to any disclosure pursuant to this subsection 2.02(b).
(c) The Trustee shall have no power to create, assume or incur
indebtedness or other liabilities in the name of the Trust other than as
contemplated in this Agreement.
Section 2.03 Representations and Warranties. Except as otherwise
provided below, each Transferor hereby severally represents and warrants to the
Trustee, on behalf of the Trust, with respect to any Series of Certificates, as
of the date of any Supplement and the related Closing Date (but only if it was a
Transferor on such date), unless otherwise stated in such Supplement that:
(i) Organization and Good Standing. Such Transferor is a
corporation or federal savings bank duly organized and validly existing
in good standing under the laws of the jurisdiction of its
incorporation or organization, and has full corporate power, authority
and legal right to own its properties and conduct its business as such
properties are presently owned and such business is presently
conducted, and to execute, deliver and perform its obligations under
this Agreement, any Supplement and each Receivable Purchase Agreement
(if any) to which it is a party and to execute and deliver to the
Trustee the Certificates pursuant hereto.
(ii) Due Qualification. Such Transferor is duly qualified to
do business and is in good standing as a foreign corporation, and has
obtained all necessary licenses and approvals, in each jurisdiction in
which failure to so qualify or to obtain such licenses and approvals
would have a material adverse effect on the conduct of its business or
render any Receivable unenforceable; provided, however, that no
representation or warranty is made with respect to any qualifications,
licenses or approvals which the Trustee would have to obtain to do
business in any state in which the Trustee seeks to enforce any
Receivable.
(iii) Due Authorization. The execution and delivery by such
Transferor of this Agreement, any Supplement and each Receivable
Purchase Agreement (if any) to which such Transferor is a party and the
execution and delivery to the Trustee of the Certificates and the
consummation by such Transferor of the transactions provided for in
this Agreement, any Supplement and each such Receivable Purchase
Agreement have been duly authorized by such Transferor by all necessary
corporate action on the part of such Transferor.
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(iv) No Violation. The execution and delivery by such
Transferor of this Agreement, any Supplement, each Receivable Purchase
Agreement (if any) to which such Transferor is a party and the
Certificates, the performance by such Transferor of the transactions
contemplated by this Agreement, any Supplement and each such Receivable
Purchase Agreement and the fulfillment by such Transferor of the terms
hereof will not conflict with, violate or result in any breach of any
of the material terms and provisions of, or constitute (with or without
notice or lapse of time or both) a material default under, any
Requirement of Law applicable to such Transferor or any material
indenture, contract, agreement, mortgage, deed of trust, or other
instrument to which such Transferor is a party or by which it or any of
its properties are bound.
(v) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of such Transferor, threatened
against such Transferor, before any court, regulatory body,
administrative agency, arbitrator or other tribunal or governmental
instrumentality (i) asserting the invalidity of this Agreement, any
Supplement, each Receivable Purchase Agreement (if any) to which such
Transferor is a party or the Certificates, (ii) seeking to prevent the
issuance of the Certificates or the consummation of any of the
transactions contemplated by this Agreement, any Supplement, each such
Receivable Purchase Agreement or the Certificates, (iii) seeking any
determination or ruling that, in the reasonable judgment of such
Transferor, would materially and adversely affect the performance by
such Transferor of its obligations under this Agreement, any Supplement
or each such Receivable Purchase Agreement, (iv) seeking any
determination or ruling that would materially and adversely affect the
validity or enforceability of this Agreement, any Supplement, each such
Receivable Purchase Agreement or the Certificates or (v) seeking to
affect adversely the Federal or State of New York income tax attributes
of the Trust.
(vi) Eligibility of Accounts. As of the Selection Date (or,
with respect to Additional Accounts, as of the applicable Additional
Account Selection Date) applicable to each Account as to which
Receivables thereunder have been transferred by such Transferor, such
Account was an Eligible Account.
(vii) All Consents Required. All approvals, authorizations,
consents, orders or other actions of any Person or of any Governmental
Authority required to be obtained on or prior to the date as of which
this representation is being made by such Transferor in connection with
the execution and delivery of this Agreement, any Supplement, each
Receivable Purchase Agreement (if any) to which such Transferor is a
party and the Certificates, the performance of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof,
have been obtained.
(viii) Amount of Receivables; Computer File. The computer
files or microfiche lists delivered pursuant to Section 2.01 hereof, at
the time of their delivery, were complete and accurately reflected the
information regarding the Receivables under the Accounts in all
material respects.
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The representations and warranties set forth in this Section
2.03 shall survive the transfer and assignment of the Receivables to the Trust,
and termination of the rights and obligations of the Servicer pursuant to
Section 10.01. Upon discovery by any of the Transferors, the Servicer or the
Trustee of a breach of any of the foregoing representations and warranties, the
party discovering such breach shall give prompt written notice to the others.
Section 2.04 Representations and Warranties of the Transferors Relating
to the Agreement and any Supplement and the Receivables.
(a) Binding Obligation; Valid Transfer And Assignment. Each
Transferor hereby severally represents and warrants to the Trustee, on behalf of
the Trust, with respect to any Series of Certificates, as of the date of any
Supplement and the related Closing Date, unless otherwise stated in such
Supplement that:
(i) Each of this Agreement, any Supplement and each Receivable
Purchase Agreement (if any) to which such Transferor is a party,
constitutes a legal, valid and binding obligation of such Transferor,
enforceable against such Transferor, in accordance with its terms,
subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect affecting
the enforcement of creditors' rights and except as such enforceability
may be limited by general principles of equity (whether considered in a
suit at law or in equity).
(ii) This Agreement constitutes either (A) a valid transfer
and assignment to the Trust of all right, title and interest of such
Transferor in and to the Receivables now existing and hereafter
created, all monies due or to become due with respect thereto on and
after the Cut-Off Date applicable to the Receivables conveyed by such
Transferor to the Trust, Recoveries, and all proceeds (as defined in
the UCC as in effect in the Relevant UCC State) of such Receivables,
such funds as are from time to time deposited in the Collection
Account, Special Funding Account and any other account or accounts
maintained for the benefit of Certificateholders and the benefits of
any Enhancement, and such Receivables and all proceeds thereof will be
held by the Trust free and clear of any Lien of any Person claiming
through or under such Transferor or any of its Affiliates except for
(x) Liens permitted under subsection 2.05(b), (y) the interest of such
Transferor as a holder of the Exchangeable Transferor Certificate and
(z) any right of the holder of the Exchangeable Transferor Certificate
to receive interest accruing on, and investment earnings with respect
to, the Collection Account or any other account or accounts maintained
for the benefit of Certificateholders as provided in this Agreement and
any Supplement or (B) a grant of a security interest (as defined in the
UCC as in effect in the Relevant UCC State) in such property to the
Trustee on behalf of the Trust, which is enforceable with respect to
existing Receivables (other than Receivables in Additional Accounts)
and the proceeds thereof to the extent set forth in the UCC in effect
in the Relevant UCC State upon execution and delivery of this
Agreement, and which will be enforceable with respect to such
Receivables thereafter created, and the proceeds thereof to such
extent, upon such creation. If this Agreement constitutes the grant of
a security interest to the Trust in such property, upon the filing of
the applicable financing statements and in the case of the Receivables
hereafter created and proceeds thereof upon such creation, the Trust
shall have a first priority perfected security interest in such
property to the extent set forth in the UCC in effect in the Relevant
UCC State relating to such Receivables, except for Liens permitted
under subsection 2.05(b) hereunder. Neither such Transferor nor any
Person claiming through or under such Transferor shall have any claim
to or interest in the Collection Account or any other account or
accounts maintained for the benefit of Certificateholders, except for
any right of the Transferors to receive interest accruing on, and
investment earnings with respect to, any such account as provided in
this Agreement and any Supplement and, if this Agreement constitutes
the grant of a security interest in such property, except for the
interest of such Transferor in such property as a debtor for purposes
of the UCC as in effect in the Relevant UCC State. Each Receivable
Purchase Agreement constitutes a transfer to the related Transferor of
all right, title and interest of the related Account Originator in and
to the Receivables purported to be sold thereunder, whether then
existing or thereafter created in the applicable Accounts and the
proceeds thereof.
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(b) Eligibility of Receivables. Each Transferor hereby
severally represents and warrants to the Trustee, on behalf of the Trust, as of
the Cut-Off Date or Additional Account Cut-Off Date applicable to the
Receivables conveyed by such Transferor to the Trustee and on each Additional
Account Cut-Off Date applicable to Receivables to be conveyed by it to the
Trustee that (i) each such Receivable then existing is an Eligible Receivable,
(ii) all material information with respect to the Accounts and Receivables
provided to the Trustee by such Transferor was true and correct in all material
respects as of the Selection Date or the related Additional Account Selection
Date, (iii) each Receivable then existing has been conveyed to the Trust free
and clear of any Lien of any Person claiming through or under such Transferor or
any of its Affiliates (other than Liens permitted under subsection 2.05(b)) and
in compliance, in all material respects, with all Requirements of Law applicable
to such Transferor, (iv) with respect to each such Receivable then existing, all
consents, licenses, approvals or authorizations of or registrations or
declarations with any Governmental Authority required to be obtained, effected
or given by such Transferor, in connection with the conveyance of such
Receivable to the Trustee have been duly obtained, effected or given and are in
full force and effect, (v) as of the Initial Closing Date, and, as of the
applicable Additional Account Cut-Off Date with respect to Additional Accounts,
Schedule 1 to this Agreement is and will be an accurate and complete listing of
all the Accounts in all material respects as of such Initial Closing Date or
applicable Additional Account Cut-Off Date, as the case may be, and the
information contained therein with respect to the identity of such Accounts and
the Receivables existing thereunder is and will be true and correct in all
material respects as of such Initial Closing Date or Additional Account Cut-Off
Date and (vi) no selection procedure believed by such Transferor to be adverse
to the interests of the Investor Certificateholders have been used in selecting
the initial Accounts. On each day on which any new Receivable is created, such
Transferor shall be deemed to represent and warrant to the Trust that (A) each
Receivable created on such day is an Eligible Receivable, (B) each Receivable
created on such day has been conveyed to the Trust in compliance, in all
material respects, with all Requirements of Law applicable to such Transferor,
(C) with respect to each such Receivable, all consents, licenses, approvals or
authorizations of or registrations or declarations with any Governmental
Authority required to be obtained, effected or given by such Transferor, in
connection with the conveyance of such Receivable to the Trust have been duly
obtained, effected or given and are in full force and effect and (D) the
representations and warranties set forth in subsection 2.04(a) are true and
correct with respect to each Receivable created on such day as if made on such
day.
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(c) Notice of Breach. The representations and warranties set
forth in this Section 2.04 shall survive the transfer and assignment of the
Receivables to the Trust and the termination of the rights and obligations of
the Servicer pursuant to Section 10.01. Upon discovery by a Transferor, the
Servicer or the Trustee of a breach of any of the representations and warranties
set forth in this Section 2.04, the party discovering such breach shall give
prompt written notice to the others.
(d) Transfer of Ineligible Receivables.
(i) Automatic Removal. In the event of a breach with respect
to a Receivable of any of the representations and warranties set forth
in subsection 2.04(b)(iii) or in the event that a Receivable is not an
Eligible Receivable as a result of the failure to satisfy the
conditions set forth in clause (iv) of the definition of an Eligible
Receivable, and either of the following two conditions is met:
(A) the Lien upon the subject Receivable (1) ranks prior to
the Lien created pursuant to this Agreement, (2) arises in favor of the United
States of America or any state or any agency or instrumentality thereof or
involves taxes or liens arising under Title IV of the Employee Retirement Income
Security Act of 1974, or (3) has been consented to by TRS or by a Transferor; or
(B) the Lien on the subject Receivable is not of the types
described in clause (A) above, and as a result of such breach or event such
Receivable becomes a Receivable in a Defaulted Account, or the related
Transferor's or the Trust's rights in, to or under such Receivable or its
proceeds are materially impaired or the proceeds of such Receivable are not
available for any reason to the Trust free and clear of any Lien except Liens
permitted pursuant to subsection 2.05(b);
then, upon the earlier to occur of the discovery of such breach or event by such
Transferor or the Servicer or receipt by the Transferors or the Servicer of
written notice of such breach or event given by the Trustee, each such
Receivable or, at the option of such Transferor, all such Receivables with
respect to the related Account shall be automatically removed from the Trust on
the terms and conditions set forth below in subsection 2.04(d)(iii).
(ii) Removal after Cure Period. In the event of a breach of
any of the representations and warranties set forth in subsection
2.04(b)(i), (ii), (iv) or (v) with respect to a Receivable (other than
in the event that a Receivable is not an Eligible Receivable as a
result of the failure to satisfy the conditions set forth in clause
(iv) of the definition of Eligible Receivable), and as a result of such
breach or event such Receivable becomes a Receivable which is not an
Eligible Receivable, the Account related to such Receivable becomes a
Defaulted Account or the Trust's rights in, to or under such Receivable
or its proceeds are materially impaired or the proceeds of such
Receivable are not available for any reason to the Trust free and clear
of any Lien except Liens permitted pursuant to subsection 2.05(b),
then, upon the expiration of 60 days or any longer period agreed upon
by the Trustee (not to exceed an additional 60 days) from the earlier
to occur of the discovery of any such event by the Transferors or the
Servicer, or receipt by the Transferors or the Servicer of written
notice of any such event given by the Trustee, each such Receivable or,
at the option of the Transferors, all such Receivables with respect to
the related Account, shall be removed from the Trust on the terms and
conditions set forth in subsection 2.04(d)(iii); provided, however,
that no such removal shall be required to be made if, on any day within
such applicable period, (A) such representations and warranties with
respect to such Receivable shall then be true and correct in all
material respects as if such Receivable had been created on such day,
and (B) such Receivable is an Eligible Receivable, the related Account
is no longer a Defaulted Account as the result of the breach of such
representation and warranty (including those implied by law), and the
Trust's rights in, to or under such Receivable or its proceeds are no
longer impaired as the result of the breach of such representation and
warranty, and the proceeds of such Receivable have become available to
the Trust free and clear of all Liens resulting in the breach of such
representation or warranty, as applicable.
25
(iii) Removal Terms and Conditions. When required or permitted
with respect to a Receivable (an "Ineligible Receivable") by the
provisions of subsection 2.04(d)(i) or subsection 2.04(d)(ii) above,
the Transferors shall remit to the Servicer, for deposit into the
Special Funding Account, the balance of such Receivable within two
Business Days of the date on which such Receivable became an Ineligible
Receivable. Any such deposit into the Special Funding Account in
connection with the reassignment of an Ineligible Receivable shall be
considered a payment in full of the Ineligible Receivable and such
deposit shall be applied in accordance with the provisions of Article
IV. Upon the reassignment to the Transferors of an Ineligible
Receivable, the Trust shall, without further action be deemed to
transfer, assign, set-over and otherwise convey to the Transferors,
without recourse, representation or warranty (including those implied
by law), all the right, title and interest of the Trust in and to such
Ineligible Receivable, all monies due or to become due with respect
thereto and all proceeds thereof. The Trustee shall execute such
documents and instruments of transfer or assignment and take such other
actions as shall reasonably be requested by the Transferors to effect
the conveyance of such Ineligible Receivable pursuant to this
subsection and as shall be specified in an Opinion of Counsel delivered
to the Trustee to the effect that such documents and instruments comply
herewith. In the event that on any day within 60 days, or any longer
period agreed upon by the Trustee (not to exceed an additional 60
days), of the date on which the removal of Receivables which are not
Eligible Receivables from the Trust pursuant to this Section is
effected, (A) the applicable representations and warranties with
respect to such Receivable shall be true and correct in all material
respects on such date and (B) the Receivable is an Eligible Receivable,
the Account corresponding to the Receivable is no longer a Defaulted
Account and the Trust's rights in, to or under such Receivable or its
proceeds are no longer impaired as a result of the breach of such
representation or warranty and the proceeds of such Receivable are
available to the Trust free and clear of all Liens resulting in the
breach of such representation and warranty, or (C) a Transferor has
cured the breach of the representation or warranty, as applicable, the
Transferors may, but shall not be required to, direct the Servicer to
include such Receivable in the Trust. Upon reinclusion of a Receivable
in the Trust pursuant to this subsection, the Transferors shall have
been deemed to have made the applicable representations and warranties
in subsection 2.04(b) as of the date of such addition, as if the
Receivable had been created on such date, and shall execute all such
necessary documents and instruments of transfer or assignment and take
such other actions as shall be necessary to effect and perfect the
reconveyance of such Receivable to the Trust. The obligation of the
Transferors set forth in this subsection shall constitute the sole
remedy respecting any breach of the representations and warranties set
forth in the above-referenced subsections with respect to such
Receivable available to Certificateholders or the Trustee on behalf of
Certificateholders.
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Notwithstanding any other provision of this subsection
2.04(d), a reassignment of an Ineligible Receivable shall not occur if the
Transferors fail to make the deposit required by this subsection 2.04(d) with
respect to such Ineligible Receivable.
(iv) No Impairment. For the purposes of subsections 2.04(d)(i)
and 2.04(d)(ii) above, proceeds of a Receivable shall not be deemed to
be impaired hereunder solely because such proceeds are held by the
Servicer for more than the applicable period under the UCC as in effect
in the Relevant UCC State.
(e) Reassignment of Trust Portfolio. In the event of (1) a
breach of any of the representations or warranties set forth in subsection
2.03(i) or 2.04(a) or (2) a material amount of Receivables are not Eligible
Receivables, and in either case such event has a material adverse effect on
Investor Certificateholders, either the Trustee or the Holders of Investor
Certificates evidencing Undivided Interests aggregating more than 50% of the
Aggregate Invested Amount, by notice then given in writing to the Transferors
(and to the Trustee and the Servicer, if given by the Investor
Certificateholders), may direct the Transferors to accept reassignment of all
Receivables within 60 days of such notice, or within such longer period as may
be specified in such notice (not to exceed an additional 60 days) and the
Transferors shall be obligated to accept such reassignment on a Distribution
Date specified by the Transferors occurring within such applicable period on the
terms and conditions set forth below; provided, however, that no such
reassignment shall be required to be made if, on the Business Day prior to such
Distribution Date the representations and warranties contained in subsection
2.03(i) and 2.04(a) shall then be true and correct in all material respects, or
there shall no longer be a material amount of Receivables which are not Eligible
Receivables, as the case may be. The Transferors shall deposit on the Business
Day prior to the Distribution Date (in immediately available funds) an amount
equal to the reassignment deposit amount for such Receivables in the Collection
Account for distribution to the Investor Certificateholders pursuant to Section
12.03. The deposit amount for such reassignment shall be equal to the Aggregate
Invested Amount on the Record Date related to the applicable Distribution Date
on which such deposit is made (less the aggregate principal amount on deposit in
any principal funding account) plus an amount equal to all accrued but unpaid
interest on the Certificates of all Series at the applicable certificate rates
through the end of the interest accrual periods of such Series. Payment of the
reassignment deposit amount and all other amounts in the Collection Account in
respect of the preceding Due Period shall be considered a prepayment in full of
all such Receivables. On the Distribution Date with respect to which such amount
has been deposited in full into the Collection Account, the Receivables and all
monies due or to become due with respect thereto and all proceeds relating
thereto shall be released to the Transferors and the Trustee shall execute and
deliver such instruments of transfer or assignment, in each case without
recourse, representation or warranty, as shall be reasonably requested by the
Transferors to vest in the Transferors or their designees or assignees, all
right, title and interest of the Trust in and to the Receivables, all monies due
or to become due with respect thereto and all proceeds thereof and as shall be
specified in an Opinion of Counsel delivered to the Trustee to the effect that
such documents and instruments comply herewith. If the Trustee or the Investor
Certificateholders give a notice directing the Transferors to accept
reassignment as provided herein, the obligation of the Transferors to accept
reassignment of the Receivables pursuant to this subsection 2.04(e) shall
constitute the sole remedy respecting a breach of the representations and
warranties contained in subsection 2.03(i) or 2.04(a) or there being a material
amount of Receivables which are not Eligible Receivables available to the
Investor Certificateholders or the Trustee on behalf of the Investor
Certificateholders.
27
(f) Nothing contained in this Section 2.04 shall create an
obligation on the part of the Trustee to verify the accuracy or continued
accuracy of the representations or warranties contained in this Section 2.04.
The Trustee shall have no obligation to give any notice pursuant to this Section
2.04 unless it has actual knowledge of facts which would permit the giving of
such notice.
(g) Each Transferor hereby makes the following representations
and warranties with respect to the Receivables it conveys to the Trustee. Such
representations and warranties shall survive until the termination of this
Agreement and each shall speak as of the date of this Agreement and, with
respect to Receivables in Additional Accounts, as of the related Additional
Account Closing Date. None of the following shall be waived by any of the
parties to this Agreement unless each Rating Agency shall have notified the
Transferors, the Servicer and the Trustee in writing that such waiver will not
result in a reduction or withdrawal of the rating of any outstanding Series or
Class to which it is a Rating Agency.
(1) This Agreement creates a valid and continuing security
interest (as defined in the applicable UCC) in favor of the Trustee in
the Receivables described in Section 2.01 of this Agreement or in
Section 3(a) of any Assignment (the "Collateral"), which security
interest is prior to all other Liens except as otherwise permitted
hereunder, and is enforceable as such against creditors of and
purchasers from such Transferor.
(2) The Collateral constitutes "accounts" or "general
intangibles" within the meaning of the applicable UCC.
(3) At the time of its transfer of any Receivable to the
Trustee pursuant to this Agreement or an Assignment, such Transferor
owned and had good and marketable title to such Receivable free and
clear of any lien, claim or encumbrance of any Person except as
otherwise permitted hereunder.
(4) Such Transferor has caused or will have caused, within ten
(10) days of the initial execution of this Agreement and each
Assignment, the filing of all appropriate financing statements in the
proper filing office in the appropriate jurisdictions under applicable
law in order to perfect the security interest in the related Collateral
granted to the Trustee pursuant to this Agreement or such Assignment.
28
(5) Other than the security interest granted to the Trustee
pursuant to this Agreement or an Assignment, such Transferor has not
pledged, assigned, sold, granted a security interest in, or otherwise
conveyed the Collateral. Such Transferor has not authorized the filing
of and is not aware of any financing statements against such Transferor
that include a description of the Collateral other than any financing
statement relating to the security interest granted to the Trust
pursuant to this Agreement or an Assignment or that has been
terminated. Such Transferor is not aware of any judgment or tax lien
filings against such Transferor.
Section 2.05 Covenants of the Transferors. Each Transferor hereby
severally covenants that:
(a) Receivables Not to be Evidenced by Promissory Notes or
Chattel Paper. Such Transferor will take no action to cause any Receivable to be
evidenced by any instrument (as defined in the UCC as in effect in the Relevant
UCC State). Each Receivable shall be payable pursuant to a contract which does
not create a Lien on any goods purchased thereunder.
(b) Security Interests. Except for the conveyances hereunder,
such Transferor will not sell, pledge, assign or transfer to any other Person,
or grant, create, incur, assume or suffer to exist any Lien on any Receivable,
whether now existing or hereafter created, or any interest therein; such
Transferor will notify the Trustee of the existence of any Lien on any
Receivable transferred by such Transferor immediately upon discovery thereof;
and such Transferor will defend the right, title and interest of the Trust in,
to and under the Receivables, whether now existing or hereafter created, against
all claims of third parties claiming through or under such Transferor; provided,
however, that nothing in this subsection 2.05(b) shall prevent or be deemed to
prohibit TRS or a Transferor from suffering to exist upon any of the Receivables
any Liens for municipal or other local taxes and other governmental charges if
such taxes or governmental charges shall not at the time be due and payable or
if TRS or such Transferor shall currently be contesting the validity thereof in
good faith by appropriate proceedings and shall have set aside on its books
adequate reserves with respect thereto; provided, further, that nothing in this
subsection shall prohibit the Transferors from participating an interest in the
Exchangeable Transferor Certificate pursuant to subsection 6.03(b) hereof.
(c) Account Agreements and Guidelines. Such Transferor shall
cause the Account Originators to comply with and perform its obligations under
the applicable Account Agreements relating to the Accounts and the Account
Guidelines except insofar as any failure so to comply or perform would not
materially and adversely affect the rights of the Trust or the Investor
Certificateholders hereunder or under the Certificates. Subject to compliance
with all Requirements of Law the failure to comply with which would have a
material adverse effect on the Investor Certificateholders, an Account
Originator may change the terms and provisions of its Account Agreements or its
Account Guidelines in any respect (including, without limitation, the
calculation of the amount, or the timing, of Charge-Offs) as follows: (a) if
such Account Originator owns a comparable segment of accounts then such change
shall be made applicable to such comparable segment of the accounts owned and
serviced by it that have characteristics the same as, or substantially similar
to, the Accounts that are the subject of such change, and (b) if such Account
Originator does not own such a comparable segment, then it will not make any
such change with the intent to materially benefit itself, or any Transferor over
the Investor Certificateholders.
29
(d) Account Allocations. In the event that such Transferor is
unable for any reason to transfer Receivables to the Trust in accordance with
the provisions of this Agreement (including, without limitation, by reason of
the application of the provisions of Section 9.02 or an order of any court of
competent jurisdiction that such Transferor not transfer any additional
Receivables to the Trust) then, in any such event, (A) such Transferor agrees
(except as prohibited by any such order) to allocate and pay to the Trust, after
the date of such inability, all Principal Collections, and all amounts which
would have constituted Principal Collections but for such Transferor's inability
to transfer such Receivables (up to an aggregate amount equal to the amount of
Trust Principal Component in the Trust on such date); (B) such Transferor agrees
to have such amounts applied as Collections in accordance with Article IV, and
(C) for only so long as the allocation and application of all Collections and
all amounts which would have constituted Collections are made in accordance with
clauses (A) and (B) above, Principal Collections and all amounts which would
have constituted Principal Collections but for such Transferor's inability to
transfer Receivables to the Trust which are charged off as uncollectible in
accordance with this Agreement shall continue to be allocated in accordance with
the related Supplement, and all amounts which would have constituted Principal
Collections but for such Transferor's inability to transfer Receivables to the
Trust shall be deemed to be Principal Collections for the purpose of calculating
the applicable Invested Percentage thereunder. If such Transferor is unable
pursuant to any Requirement of Law to allocate Collections as described above,
such Transferor agrees that it shall, in any such event, allocate, after the
date that it becomes unable to do so, payments on each Account with respect to
the balance of such Account first to the oldest receivable in such Account and
to have such payments applied as Collections in accordance with Article IV.
(e) Delivery of Collections. In the event that such Transferor
receives Collections, such Transferor agrees to pay to the Servicer all payments
received by it with respect to Collections on the Receivables as soon as
practicable after receipt thereof by it, but in no event later than two Business
Days after the receipt by it thereof.
(f) Notice of Liens. Such Transferor shall notify the Trustee
promptly after becoming aware of any Lien on any Receivable other than the
conveyances hereunder.
(g) Change in Yield Factor. Provided that no Pay Out Event
shall have occurred and be continuing, without notice to or the consent of
Certificateholders of any Series, the Transferors may, upon ten Business Days
prior written notice to the Servicer and the Trustee, require that the Yield
Factor be changed from and after the close of business on the date set forth in
such notice as of the effective date of such change. The Transferors may not
increase the Yield Factor above 5.0%. Any such change shall be subject to the
satisfaction of the following conditions:
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(i) Such change in the Yield Factor shall not, in the
reasonable belief of the Transferors cause a Pay Out Event to occur or
an event which, with notice or the lapse of time or both would
constitute a Pay Out Event.
(ii) Such change in the Yield Factor shall not cause the Yield
Factor to be reduced below the initial Yield Factor.
(iii) The Rating Agencies shall have received ten Business
Days' notice of such proposed change and the Transferors shall have
received written confirmation that such proposed change shall not cause
the downgrade or withdrawal of any rating assigned to any outstanding
Series by Moody's (if Moody's shall then be a Rating Agency).
(iv) Each Transferor shall deliver to the Trustee an Officer's
Certificate confirming the items set forth in paragraphs (i) through
(iii) above and the Trustee may conclusively rely on such Officer's
Certificates, shall have no duty to make inquiries with regard to the
matters set forth therein and shall incur no liability in so relying.
In the event that the Servicer is not required to make daily deposits
of Collections in the Collection Account at the date of such change,
the Transferors may specify either the first day of the current Due
Period or the first day of the next succeeding Due Period as the
effective date of such change. If the Servicer is then required to make
daily deposits of Collections in the Collection Account at the time of
such change, the Transferors may specify that the date upon which all
of the conditions specified in this subsection 2.05(g) have been
complied with is the effective date of this change.
Section 2.06 Addition of Accounts.
(a) If, (1) as of the end of any two consecutive Due Periods,
the Transferor Amount as a percentage of the Trust Principal Component is less
than the Minimum Transferor Percentage, the Transferors shall designate
additional Eligible Accounts (the "Additional Accounts") to be included as
Accounts in a sufficient amount such that the Transferor Amount as a percentage
of the Trust Principal Component after giving effect to such addition at least
equals the Minimum Transferor Percentage, or (2) as of the end of any Due
Period, the Trust Principal Component is less than the Minimum Trust Principal
Component, then the Transferor shall designate Additional Accounts to be
included as Accounts in a sufficient amount such that the Trust Principal
Component will be equal to or greater than the Minimum Trust Principal
Component. Receivables from such Additional Accounts shall be transferred to the
Trust, in the case of subclause (i), on or before 15 days following the
Determination Date related to the second of such Due Periods and, in the case of
subclause (2), on or before 15 days following such Determination Date (the
"Additional Account Closing Date").
(b) In addition to its obligation under subsection 2.06(a),
the Transferors may, but shall not be obligated to, designate from time to time
Additional Accounts to be included as Accounts.
(c) The Transferors agree that any such transfers of
Receivables from Additional Accounts under subsection 2.06(a) or (b) shall
satisfy the following conditions:
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(i) On or before the tenth Business Day prior to the
Additional Account Closing Date, the Transferors shall give the Trustee
and the Servicer written notice that such Additional Accounts will be
included and specifying the approximate aggregate amount of the
Receivables to be transferred;
(ii) On or prior to the Additional Account Closing Date, the
Transferors shall have delivered to the Trustee a written assignment
(and the Trustee shall have accepted such assignment on behalf of the
Trust for the benefit of the Investor Certificateholders and any
Enhancement Provider) in substantially the form of Exhibit B (the
"Assignment") and shall have clearly indicated in their respective
computer files that the Receivables created in connection with the
Additional Accounts have been transferred to the Trustee and the
Servicer shall have delivered to the Trustee a computer file or
microfiche list represented by the Servicer to contain a true and
complete list of all Additional Accounts identified by account number
and by Receivable balance in such Additional Accounts as of the
Additional Account Cut-Off Date, which computer file or microfiche list
shall be as of the date of such Assignment incorporated into and made a
part of such Assignment and this Agreement;
(iii) The Transferors shall severally represent and warrant
that (x) each Additional Account was, as of the date of its selection
(the "Additional Account Selection Date"), an Eligible Account, (y) no
selection procedures believed by the Transferors to be materially
adverse to the interests of any Series of Investor Certificates or any
Enhancement Provider were utilized in selecting the Additional Accounts
from the available Eligible Accounts in each Transferor's portfolio;
and (z) as of the Additional Account Closing Date, no Transferor is
insolvent or will be made insolvent by the transfer of the Receivables
of such Additional Accounts;
(iv) The Transferors shall represent and warrant, that, as of
the Additional Account Closing Date, the Assignment constitutes either
(x) a valid transfer and assignment to the Trust of all right, title
and interest of the Transferors in and to the Receivables then existing
and thereafter created in the Additional Accounts, all monies due or to
become due with respect thereto on and after the Additional Account
Cut-Off Date, Recoveries and all proceeds of such Receivables to the
extent set forth in the UCC as in effect in the Relevant UCC State, and
such Receivables and all proceeds thereof will be conveyed to the Trust
free and clear of any Lien of any Person claiming through or under a
Transferor or any of its Affiliates, except for (i) Liens permitted
under subsection 2.05(b) hereunder, (ii) the interest of the holder of
the Exchangeable Transferor Certificate and (iii) any right of the
holder of the Exchangeable Transferor Certificate to receive interest
accruing on, and investment earnings with respect to, the Collection
Account and any other account or accounts maintained for the benefit of
Certificateholders as provided in this Agreement and any Supplement or
(y) a grant of a security interest (as defined in the UCC as in effect
in the Relevant UCC State) in such property to the Trustee on behalf of
the Trust, which is enforceable with respect to then existing
Receivables of the Additional Accounts, and the proceeds thereof to the
extent set forth in the UCC as in effect in the Relevant UCC State upon
the conveyance of such Receivables to the Trust, and which will be
enforceable with respect to the Receivables thereafter created in
respect of Additional Accounts, and the proceeds (to the extent set
forth in the UCC as in effect in the Relevant UCC State) thereof upon
such creation; and (z) if the Assignment constitutes the grant of a
security interest to the Trust in such property, upon the filing of
financing statements as described in Section 2.01 with respect to such
Additional Accounts and in the case of such Receivables of Additional
Accounts thereafter created and the proceeds thereof to the extent set
forth in the UCC in effect in the Relevant UCC State, upon such
creation, the Trust shall have a first priority perfected security
interest in such property, except for Liens permitted under subsection
2.05(b) hereunder;
32
(v) Each Transferor shall deliver to the Trustee (with a copy
to the Rating Agencies) an Officer's Certificate confirming the items
set forth in paragraphs (ii), (iii) and (iv) above and (vii) below and
the Trustee may conclusively rely on such Officer's Certificate, shall
have no duty to make inquiries with regard to the matters set forth
therein and shall incur no liability in so relying;
(vi) The Transferors shall deliver to the Trustee and each
Rating Agency an Opinion of Counsel with respect to the Receivables in
the Additional Accounts substantially in the form of Part One of
Exhibit G; and
(vii) The Rating Agencies shall have received ten (10)
Business Days' notice of such proposed addition of Additional Accounts;
in the event that Additional Accounts are being added pursuant to
subsection 2.06(b), the Transferors shall have received written
confirmation from Moody's (if Moody's shall then be a Rating Agency)
that such addition would not result in a downgrade or withdrawal of its
then current rating of any outstanding Series of Investor Certificates;
and, in the event that the number of Additional Accounts designated
with respect to any three consecutive Due Periods would exceed 15% of
the number of Accounts as of the first day of the calendar year during
which such Due Periods commence or the number of Additional Accounts
designated during any such calendar year would exceed 20% of the number
of Accounts as of the first day of such calendar year, the Transferors
shall have received written confirmation from Standard & Poor's, (if
Standard & Poor's shall then be a Rating Agency) that such addition
would not result in a downgrade or withdrawal of its then current
rating of any outstanding Series of Investor Certificates.
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Section 2.07 Removal of Accounts.
(a) Subject to the conditions set forth below, on each
Determination Date on which the Transferor Amount as a percentage of the Trust
Principal Component exceeds 20% at the end of the related Due Period, the
Transferors may, but shall not be obligated to, designate, from time to time,
Accounts for deletion and removal ("Removed Accounts") from the Accounts;
provided, however, that the Transferors shall not make more than one such
designation in any Due Period. On or before the tenth Business Day (the "Removal
Notice Date") prior to the date on which the designated Removed Accounts will be
reassigned by the Trustee to the Transferors (the "Removal Date"), the
Transferors shall give the Trustee and the Servicer written notice that the
Receivables from such Removed Accounts are to be reassigned to the Transferors.
(b) The Transferors shall be permitted to designate and
require reassignment to them of Receivables from Removed Accounts only upon
satisfaction of the following conditions:
(i) On or prior to the Removal Date, the Transferors shall
have delivered to the Trustee for execution a written instrument of
reassignment in substantially the form of Exhibit C (the
"Reassignment") and a computer file or microfiche list containing a
true and complete list of all Removed Accounts identified by account
number and by the aggregate balance of the Receivables in such Removed
Accounts as of the Removal Notice Date, which computer file or
microfiche list shall as of the Removal Date modify and amend and be
made a part of this Agreement;
(ii) The Transferors shall severally represent and warrant
that no selection procedures believed by the Transferors to be
materially adverse to the interests of any outstanding Series of
Investor Certificates or any Enhancement Provider were utilized in
selecting the Removed Accounts to be removed from the Trust;
(iii) The removal of any Receivables of any Removed Accounts
on any Removal Date shall not, (a) in the reasonable belief of the
Transferors, cause a Pay Out Event to occur or an event, which with
notice or lapse of time or both would constitute a Pay Out Event, to
occur and (b) cause the Transferor Amount as a percentage of the Trust
Principal Component to be less than the Minimum Transferor Percentage
on such Removal Date;
(iv) The Rating Agencies shall have received ten Business
Days' notice of such proposed removal of Accounts and the Transferors
shall have received written notice from the Rating Agencies that such
removal would not result in a downgrade or withdrawal of the then
current rating of any outstanding Series of the Investor Certificates;
and
(v) Each Transferor shall have delivered to the Trustee and
the Rating Agencies an Officer's Certificate confirming the items set
forth in (i) through (iv) above. The Trustee may conclusively rely on
such Officer's Certificates, shall have no duty to make inquiries with
regard to the matters set forth therein and shall incur no liability in
so relying.
34
Upon satisfaction of the above conditions, the Trustee shall
execute and deliver the Reassignment to the Transferors, and the Receivables
from the Removed Accounts shall no longer constitute a part of the Trust.
(c) The Transferors shall be required to designate Accounts
for deletion and removal from the Accounts and to require the Trustee to
reassign the designated Accounts to the Transferor on a Determination Date (the
"PA Removal Date") no later than 120 days after the first Determination Date in
which:
(i) Estimated Trust Privileged Assets Billed Amounts for the
month in which the last day of the second preceding Due Period occurs
exceed 1% of Trust Principal Component for the Due Period immediately
preceding such Determination Date, unless the Transferor Amount as a
percentage of the Trust Principal Component for such immediately
preceding Due Period equals or exceeds 17%; or
(ii) The average of the Privileged Assets Monthly Payment
Rates for the six month period ending on the last day of the second
preceding Due Period does not equal at least 110% of the Trust Average
Monthly Payment Rate for the Due Period immediately preceding such
Determination Date, unless the Transferor Amount as a percentage of the
Trust Principal Component for such immediately preceding Due Period
equals or exceeds 17%.
The Accounts that shall be designated for deletion and removal
pursuant to this Subsection 2.07(c) (the "Removed PA Accounts") shall consist of
all Accounts that are enrolled in the Privileged Assets Program as of a date 60
days or less prior to the PA Removal Date; provided, that the Transferors shall
not be required to designate for removal more Accounts than is necessary to
reduce the Estimated Trust Privileged Assets Billed Amounts determined under
Section 2.07(c)(i) to 0.50% of the Trust Principal Component.
Upon satisfaction of the requirements of subsection 2.07(b)(i)
with respect to the PA Removed Accounts and the delivery by the Transferors to
the Trustee and the Rating Agencies of an Officer's Certificate confirming such
item, the Trustee shall execute and deliver the Reassignment to the Transferors,
and the Receivables from the Removed PA Accounts shall no longer constitute a
part of the Trust. The Trustee may conclusively rely on such Officer's
Certificate, shall have no duty to make inquiries with regard to the matters set
forth therein and shall incur no liability in so relying.
[END OF ARTICLE II]
35
ARTICLE III
ADMINISTRATION AND SERVICING
OF RECEIVABLES
Section 3.01 Acceptance of Appointment and Other Matters Relating to
the Servicer.
(a) TRS has agreed to act, and has acted, as the Servicer
under the Original Pooling Agreement, and TRS hereby agrees to act as the
Servicer under this Agreement. Investor Certificateholders by their acceptance
of the Investor Certificates shall be deemed to consent to TRS acting as
Servicer.
(b) The Servicer shall service and administer the Receivables
and shall collect payments due under the Receivables in accordance with its
customary and usual servicing procedures for servicing consumer charge card
receivables comparable to the Receivables and in accordance with the applicable
Account Guidelines and shall have full power and authority, acting alone or
through any party properly designated by it hereunder, to do any and all things
in connection with such servicing and administration which it may deem necessary
or desirable. Without limiting the generality of the foregoing and subject to
Section 10.01, the Servicer is hereby authorized and empowered (i) to make
withdrawals and payments and to instruct the Trustee to make withdrawals and
payments from the Collection Account, the Special Funding Account or any other
account or accounts maintained for the benefit of the Certificateholders as set
forth in this Agreement and any Supplement, (ii) unless such power and authority
is revoked by the Trustee on account of the occurrence of a Servicer Default
pursuant to Section 10.01 of the Agreement to instruct the Trustee to take any
action permitted or required under any Enhancement at such time as set forth in
this Agreement and any Supplement (iii) to execute and deliver, on behalf of the
Trust for the benefit of the Certificateholders, any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge, and
all other comparable instruments, with respect to the Receivables and, after the
delinquency of any Receivable and to the extent permitted under and in
compliance with applicable law and regulations, to commence enforcement
proceedings with respect to such Receivables, (iv) to make any filings, reports,
notices of applications, or registrations with, and to seek any consents or
authorizations from, the Securities and Exchange Commission and any state
securities laws authority on behalf of the Trust as may be necessary or
advisable to comply with any Federal or state securities laws or reporting
requirements and (v) to delegate its servicer, collection, enforcement and
administrative duties hereunder with respect to the Accounts and the Receivables
to FDC or other Person who agrees to conduct such duties in accordance with the
Account Guidelines; provided, however, that the Servicer shall notify each
Rating Agency in writing of any significant delegation of its duties to a Person
other than FDC and which is not in the ordinary course of the Servicer's
business. No such delegation will relieve the Servicer of its liability and
responsibility with respect to such duties. The Trustee shall promptly follow
the written instructions of the Servicer to withdraw funds from the Collection
Account, the Special Funding Account and any other account or accounts
maintained for the benefit of Certificateholders and with regard to any
Enhancement. The Trustee shall furnish the Servicer with any powers of attorney
and other documents necessary or appropriate to enable the Servicer to carry out
its servicing and administrative duties hereunder and the Trustee shall not be
held responsible for any act or omission by the Servicer in its use of such
powers of attorney.
36
(c) In the event that a Transferor is unable for any reason to
transfer Receivables to the Trust in accordance with the provisions of this
Agreement (including, without limitation, by reason of the application of the
provisions of Section 9.02 or the order of any court of competent jurisdiction
that such Transferor not transfer any additional Receivables to the Trust) then,
in any such event, (A) the Servicer agrees to allocate, after such date, all
Principal Collections, and all amounts which would have constituted Principal
Collections but for such Transferor's inability to transfer such Receivables (up
to an aggregate amount equal to the Trust Principal Component in the Trust as of
such date) in accordance with subsection 2.05(d) and to apply such amounts as
Collections in accordance with Article IV and (B) for only so long as all
Collections and all amounts which would have constituted Collections are
allocated and applied in accordance with clause (A) above, Principal Collections
and all amounts which would have constituted Principal Collections but for such
Transferor's inability to transfer Receivables to the Trust which are charged
off as uncollectible in accordance with this Agreement shall continue to be
allocated in accordance with Article IV and all amounts which would have
constituted Principal Collections but for such Transferor's inability to
transfer Receivables to the Trust shall be deemed to be Principal Collections
for the purpose of calculating the applicable Invested Percentage thereunder;
provided, that if the Servicer is unable pursuant to any Requirement of Law to
allocate payments on the Accounts as described above, the Servicer agrees that
it shall, in any such event, allocate, after the date that the Transferor
becomes unable to do so, payments on the Accounts with respect to the
receivables in such Accounts first to the oldest receivables in such Accounts.
(d) The Servicer shall not be obligated to use separate
servicing procedures, offices, employees or accounts for servicing the
Receivables from the procedures, offices, employees and accounts used by the
Servicer in connection with servicing other consumer charge card receivables.
(e) The Servicer shall maintain fidelity bond coverage
insuring against losses through wrongdoing of its officers and employees who are
involved in the servicing of Receivables covering such actions with such
insurers and in such amounts as the Servicer believes to be reasonable from time
to time.
(f) The Servicer shall apply payments received by the Servicer
in respect of Accounts to Receivables and to Privileged Assets Billed Amounts in
accordance with the applicable guidelines provided in the authorization
agreement pursuant to which Cardmembers enroll in the Privileged Assets Program
or as otherwise determined by the Servicer pursuant to a Cardmember request in
accordance with the Servicer's practices for the Privileged Assets Program;
provided, that in no event shall payments be applied as annuity contributions
under the Privileged Assets Program in priority to past due card charges.
Section 3.02 Servicing Compensation. As compensation for its servicing
activities hereunder and reimbursement for its expenses as set forth in the
immediately following paragraph, the Servicer shall be entitled to receive a
monthly servicing fee in respect of any Due Period (or portion thereof) prior to
the termination of the Trust pursuant to Section 12.01 (the "Monthly Servicing
Fee"), payable in arrears on each Distribution Date in an amount equal to the
sum of, with respect to all Series then outstanding, one-twelfth of the product
of the applicable Servicing Fee Percentages and the sum of an allocable portion
of the Transferor Amount and the Invested Amount of each Series each as of the
last day of the second preceding Due Period. The share of the Monthly Servicing
Fee allocable to each Series of Investor Certificateholders with respect to any
Due Period (or portion thereof) shall be equal to one-twelfth of the product of
(A) the Servicing Fee Percentage for such Series and (B) the Invested Amount of
such Series (after subtracting from the Invested Amount the aggregate amount of
any deposits previously made into any principal funding account) on the last day
of the second preceding Due Period (or, in the case of the first Distribution
Date, the Initial Invested Amount) with respect to any such Series, the
"Investor Monthly Servicing Fee") and shall be paid to the Servicer pursuant to
the applicable Supplement. The remainder of the Monthly Servicing Fee shall be
paid by the Transferor and in no event shall the Trust, the Trustee or the
Investor Certificateholders be liable for the share of the Monthly Servicing Fee
to be paid by the Transferors. In the case of the first Due Period, the Monthly
Servicing Fee and the Investor Monthly Servicing Fee shall accrue from the
Cut-Off Date.
37
The Servicer's expenses include the amounts due to the Trustee
pursuant to Section 11.05 and the reasonable fees and disbursements of
independent accountants and all other expenses incurred by the Servicer in
connection with its activities hereunder, and include, without limitation, all
other fees and expenses of the Trust provided for in Section 8.04 hereof;
provided, that the Servicer shall not be liable for any liabilities, costs or
expenses of the Trust, the Investor Certificateholders or the Certificate owners
arising under any tax law, including without limitation any Federal, state or
local income or franchise taxes or any other tax imposed on or measured by
income (or any interest or penalties with respect thereto or arising from a
failure to comply therewith), except to the extent incurred as a result of the
Servicer's violation of the provisions of this Agreement. The Servicer shall be
required to pay such expenses for its own account and shall not be entitled to
any payment therefor other than the Monthly Servicing Fee.
Section 3.03 Representations, Warranties and Covenants of the Servicer.
TRS, as initial Servicer, hereby makes, and any successor Servicer by its
appointment hereunder shall make, the following representations, warranties and
covenants with respect to any Series of Certificates, as of the date of the
related Supplement and its Closing Date unless otherwise stated in such
Supplement, on which the Trustee has relied in accepting the Receivables and the
other property conveyed pursuant to Section 2.01 in trust and in authenticating
the Certificates:
(a) Organization and Good Standing. The Servicer is a
corporation duly organized, validly existing and in good standing under the laws
of the State of New York, and has full corporate power, authority and legal
right to own its properties and conduct its business as such properties are
presently owned and such business is presently conducted, and to execute,
deliver and perform its obligations under this Agreement and any Supplement.
(b) Due Qualification. The Servicer is duly qualified to do
business and is in good standing (or is exempt from such requirements) as a
foreign corporation in any state where such qualification is necessary in order
to service the Receivables as required by this Agreement and any Supplement and
has obtained all necessary licenses and approvals as required under Federal and
state law, and if the Servicer shall be required by any Requirement of Law to so
qualify or register or obtain such license or approval, then it shall do so
except where the failure to obtain such license or approval does not materially
affect the Servicer's ability to perform its obligations hereunder or the
enforceability of any Receivable.
38
(c) Due Authorization. The execution, delivery, and
performance of this Agreement and any Supplement, and the consummation of the
transactions provided in this Agreement and any Supplement have been duly
authorized by the Servicer by all necessary corporate action on the part of the
Servicer.
(d) Binding Obligation. This Agreement and any Supplement
constitute a legal, valid and binding obligation of the Servicer, enforceable in
accordance with its terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereinafter in effect,
affecting the enforcement of creditors' rights in general and as such
enforceability may be limited by general principles of equity (whether
considered in a proceeding at law or in equity).
(e) No Violation. The execution and delivery of this Agreement
and any Supplement by the Servicer, and the performance of the transactions
contemplated by this Agreement and any Supplement and the fulfillment of the
terms hereof applicable to the Servicer, will not conflict with, violate, result
in any breach of any of the material terms and provisions of, or constitute
(with or without notice or lapse of time or both) a material default under, any
Requirement of Law applicable to the Servicer or any material indenture
contract, agreement, mortgage, deed of trust or other instrument to which the
Servicer is a party or by which it is bound.
(f) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of the Servicer, threatened against the
Servicer before any court, regulatory body, administrative agency or other
tribunal or governmental instrumentality seeking to prevent the issuance of the
Certificates or the consummation of any of the transactions contemplated by this
Agreement or any Supplement, seeking any determination or ruling that, in the
reasonable judgment of the Servicer, would materially and adversely affect the
performance by the Servicer of its obligations under this Agreement or any
Supplement, or seeking any determination or ruling that would materially and
adversely affect the validity or enforceability of this Agreement or any
Supplement.
(g) Compliance with Requirements of Law. The Servicer shall
duly satisfy its obligations in all material respects on its part to be
fulfilled under or in connection with each Receivable and the corresponding
Account, will maintain in effect all material qualifications required under
Requirements of Law in order to service properly each Receivable and the
corresponding Account and will comply in all material respects with all other
Requirements of Law in connection with servicing each Receivable and the related
Account the failure to comply with which would have a material adverse effect on
the Certificateholders.
(h) No Rescission or Cancellation. Except in connection with
an Adjustment Payment pursuant to Section 3.08, the Servicer shall not permit
any rescission or cancellation of any Receivable except as ordered by a court of
competent jurisdiction or other Governmental Authority.
39
(i) Protection of Rights. The Servicer shall take no action
which, nor omit to take any action the omission of which, would impair the
rights of the Trust in any Receivable, nor shall it reschedule, revise, waive or
defer payments due on any Receivable except in accordance with the applicable
Account Guidelines.
(j) All Consents Required. All approvals, authorizations,
consents, orders or other actions of any Person or of any Governmental Authority
required in connection with the execution and delivery by the Servicer of this
Agreement, the performance by the Servicer of the transactions contemplated by
this Agreement and the fulfillment by the Servicer of the terms hereof, have
been obtained, except such as are required by state securities or "Blue Sky"
laws in connection with the distribution of any Series.
(k) Receivables Not to be Evidenced by Promissory Notes or
Chattel Paper. The Servicer will take no action to cause any Receivable to be
evidenced by any instrument (as defined in the UCC as in effect in the Relevant
UCC State). Each Receivable shall be payable pursuant to a contract which does
not create a Lien on any merchandise purchased thereunder.
In the event of a breach of any of the representations and
warranties set forth in subsection 3.03(g), (h), (i) or (j) with respect to a
Receivable, and such breach has a material adverse effect on the Trustee's
Interest in such Receivable then, upon the expiration of 60 days or any longer
period agreed upon by the Trustee (not to exceed an additional 60 days) from the
earlier to occur of the discovery of any such event by the Servicer, or receipt
by the Servicer of written notice of any such event given by the Trustee, each
such Receivable or, at the option of the Transferors, all such Receivables with
respect to the related Account, shall be assigned and transferred to the
Servicer upon the deposit on the Business Day preceding the Distribution Date
related to the Due Period in which such assignment obligation arose by the
Servicer in the Collection Account of an amount equal to the balance of any such
Receivable provided, however, that if the Servicer is then required pursuant to
subsection 4.01(g) to deposit funds into the Collection Account more frequently
than monthly, the Servicer shall make such deposit no later than two Business
Days after the obligation to accept such assignment arose. Any such deposit into
the Collection Account in connection with any such assignment of a Receivable
shall be considered a payment in full of such Receivable and such deposit shall
be applied in accordance with the provisions of Article IV. Upon the assignment
to the Servicer of such a Receivable, the Trust shall, without further action be
deemed to transfer, assign, set-over and otherwise convey to the Servicer,
without recourse, representation or warranty (including those implied by law),
all the right, title and interest of the Trust in and to such Receivable, all
monies due or to become due with respect thereto and all proceeds thereof. The
Trustee shall execute such documents and instruments of transfer or assignment
and take such other actions as shall reasonably be requested by the Servicer to
effect the conveyance of any such Receivable pursuant to this Section and as
shall be specified in an Opinion of Counsel delivered to the Trustee to the
effect that such documents and instruments comply herewith. The obligation of
the Servicer set forth in this Section shall constitute the sole remedy
respecting any breach of the representations and warranties set forth in the
above referenced subsections with respect to such Receivable available to
Certificateholders or the Trustee on behalf of Certificateholders.
Notwithstanding any other provision of this Section 3.03, no assignment of a
Receivable to the Servicer pursuant to this Section 3.03 shall occur if the
Servicer fails to make the deposit required by this Section 3.03 with respect to
such Receivable.
40
Section 3.04 Reports and Records for the Trustee.
(a) Initial Report. On the day on which a Series of the
Investor Certificates are issued (the "Closing Date"), the Servicer shall
prepare and deliver, as provided in Section 13.05, to the Trustee and the Rating
Agencies, an Officer's Certificate substantially in the form of Exhibit D
setting forth the Trust Principal Component as of the end of the Due Period
immediately preceding the Closing Date.
(b) Daily Reports. For so long as deposits of Collections are
required to be made daily by the Servicer pursuant to Section 4.01(g), on each
Business Day commencing on the Closing Date the Servicer shall prepare, and make
available for inspection by the Trustee and maintain at the office of the
Servicer a record setting forth the aggregate amount of Collections processed by
the Servicer on the immediately preceding Business Day.
(c) Monthly Servicer's Certificate. On each Determination Date
the Servicer shall forward, as provided in Section 13.05, to the Trustee, the
Paying Agent and the Rating Agencies, an Officer's Certificate signed by a
Servicing officer substantially in the form of Exhibit E (with the Monthly
Certificateholder's Statement required pursuant to the applicable Supplement
attached) setting forth the following information (which, in the case of clauses
(iii), (iv) and (v) below, will be stated on the basis of an original principal
amount of $1,000 per Certificate): (i) the aggregate amount of Collections
processed for the Due Period for such Determination Date and the aggregate
amount of Yield Collections and the aggregate amount of Principal Collections
processed during such Due Period; (ii) the Invested Percentage on the last day
of the preceding Due Period of each Series of Certificates with respect to
Principal Collections, the Invested Percentage on the last day of the preceding
Due Period of each Series of Certificates with respect to Yield Collections and
Defaulted Receivables; (iii) for each Series and for each class within any such
Series, the total amount to be distributed to Investor Certificateholders on the
next succeeding Distribution Date; (iv) for each Series and for each class
within any such Series, the amount of such distribution allocable to principal;
(v) for each Series and for each class within any such Series, the amount of
such distribution allocable to interest; (vi) the aggregate outstanding balance
of the Accounts which were delinquent by 30 to 59, 60 to 89, 90 to 119 and by
120 days or more as of the close of business on the last day of the Due Period
immediately preceding such Distribution Date (calculated from the day a charge
is first included within an unpaid "Previous Balance" on any monthly billing
statement and is determined by reference to each such Account's billing cycle
closing date occurring immediately prior to such last day); (vii) for each
Series and each class within a Series, the Investor Default Amount for the
immediately preceding Due Period; (viii) for each Series and each class within a
Series, the amount of the Investor Charge-Offs and the amount of the
reimbursements of Investor Charge-Offs for such Distribution Date; (ix) for each
Series, the Investor Monthly Servicing Fee for such Distribution Date; (x) for
each Series, the existing Deficit Controlled Amortization Amount, if applicable;
(xi) the aggregate amount of Receivables in the Trust at the close of business
on the last day of the Due Period preceding such Distribution Date; (xii) for
each Series, the Invested Amount at the close of business on the last day of the
Due Period immediately preceding such Distribution Date; (xiii) the available
amount of any Enhancement for each Series; (xiv)for each Series and each class
within a Series, the Series Factor as of the end of the related Due Period; (xv)
the Yield Factor or Yield Factors applicable with respect to the related Due
Period; (xvi) whether a Pay Out Event with respect to any Series shall have
occurred during or with respect to the related Due Period; and (xvii) the
Special Funding Account balance, if any. The Trustee shall be under no duty to
recalculate, verify or recompute the information supplied to it under this
Section 3.04.
41
Section 3.05 Annual Servicer's Certificate. The Servicer will deliver,
as provided in Section 13.05, to the Trustee and the Rating Agencies on or
before March 31 of each calendar year, beginning with 1993, an Officer's
Certificate substantially in the form of Exhibit F stating (a) that a review of
the activities of the Servicer during the preceding calendar year and of its
performance under this Agreement was made under the supervision of the officer
signing such certificate and (b) that, to the best of such officer's knowledge,
based on such review, either there has occurred no event which, with the giving
of notice or passage of time or both, would constitute a Servicer Default and
the Servicer has fully performed all its obligations under this Agreement
throughout such year, or, if there has occurred such event or a Pay Out Event,
specifying each such event known to such officer and the nature and status
thereof. A copy of such officer's Certificate may be obtained by any Investor
Certificateholder or Certificate Owner by a request in writing to the Trustee
addressed to the Corporate Trust Office.
Section 3.06 Annual Independent Public Accountants' Servicing Report.
(a) On or before March 31 of each calendar year, beginning
with 1993, the Servicer shall cause a firm of nationally recognized independent
public accountants (who may also render other services to the Servicer or a
Transferor) to furnish, as provided in Section 13.05, a report to the Trustee,
the Rating Agencies and, as required, any Enhancement Provider to the effect
that such firm has applied certain procedures agreed upon with the Servicer to
certain documents and records relating to the administration and servicing of
Accounts under this Agreement and any Supplement, and that, based upon such
agreed upon procedures such firm will provide a report stating that the
servicing was conducted in compliance with Article III and IV and Section 8.08
of this Agreement and any Supplement, except for such exceptions or errors as
they believe to be immaterial and such other exceptions as shall be set forth in
such statement. A copy of such report may be obtained by any Investor
Certificateholder by a request in writing to the Trustee addressed to the
Corporate Trust Office.
(b) On or before March 31 of each calendar year, beginning
with 1993 the Servicer shall cause a firm of nationally recognized independent
public accountants (who may also render other services to the Servicer or a
Transferor) to furnish, as provided in Section 13.05, a report prepared using
generally accepted auditing standards to the Trustee, any Enhancement Provider,
as required, and the Rating Agencies to the effect that they have compared the
mathematical calculations of each amount set forth in the monthly certificates
forwarded by the Servicer pursuant to subsection 3.04(c) during the period
covered by such report (which shall be the period from January 1 of the
preceding calendar year to and including December 31 of such calendar year) with
the Servicer's computer reports which were the source of such amounts and that
on the basis of such comparison, such accountants are of the opinion that such
amounts are in agreement, except for such exceptions as they believe to be
immaterial and such other exceptions as shall be set forth in such statement. A
copy of such report may be obtained by any Investor Certificateholder or
Certificate Owner by a request in writing to the Trustee addressed to the
Corporate Trust Office.
42
Section 3.07 Tax Treatment. The Transferors have structured this
Agreement and the Investor Certificates (other than any Investor Certificates
held by the Transferors) have been (or will be) issued with the intention that
such Investor Certificates will qualify under applicable tax law as indebtedness
of the Transferors, and the Transferors, any entity acquiring any direct or
indirect interest in the Exchangeable Transferor Certificate and each Investor
Certificateholder (or Certificate Owner) by acceptance of its Certificate (or,
in the case of a Certificate Owner by virtue of such Certificate Owner's
acquisition of a beneficial interest therein) agree to treat such Investor
Certificates (or beneficial interest therein) for purposes of Federal, state and
local income or franchise taxes and any other tax imposed on or measured by
income as indebtedness. Each Certificateholder agrees that it will cause any
Certificate Owner acquiring an interest in a Certificate through it to comply
with this Agreement as to treatment as indebtedness for certain tax purposes.
Section 3.08 Adjustments. (a) If the Servicer adjusts downward the
amount of any Receivable because of a rebate, refund, unauthorized charge or
billing error to an Obligor, because such Receivable was created in respect of
merchandise which was refused or returned by an Obligor, or if the Servicer
otherwise adjusts downward the amount of any Receivable without receiving
Collections therefor or without charging off such amount as uncollectible, then,
in any such case, the amount of the Trust Principal Component used to calculate
the Transferor Amount, the Transferor Interest and the Floating Allocation
Percentage and the Fixed Allocation Percentage applicable to any Series will be
reduced by the product of one minus the Yield Factor and the amount of such
adjustment. Similarly, the amount of the Trust Principal Component used to
calculate the Transferor Amount, the Transferor Interest and the Floating
Allocation Percentage and the Fixed Allocation Percentage applicable to any
Series will be reduced by the product of one minus the Yield Factor and the
amount of any Receivable which was discovered as having been created through a
fraudulent or counterfeit charge or with respect to which the covenant contained
in subsection 2.05(b) was breached. Any adjustment required pursuant to either
of the two preceding sentences shall be made on or prior to the end of the Due
Period in which such adjustment obligation arises. In the event that, following
any such exclusion, the Transferor Amount as a percentage of the Trust Principal
Component would be less than 3%, within two Business Days of the date on which
such adjustment obligation arises, the Transferor shall pay to the Servicer, for
deposit into the Special Funding Account, in immediately available funds in an
amount equal to the amount by which the Transferor Amount would be reduced below
the product of 3% and the Trust Principal Component. Any amount deposited into
the Special Funding Account in connection with the adjustment of a Receivable
(an "Adjustment Payment") shall be applied in accordance with Article IV and the
terms of each Supplement. In the event that the Servicer adjusts upwards the
amount of any Receivable, the Trust Principal Component shall be increased by
the product of such upward adjustment and one minus the Yield Factor.
(b) If (i) the Servicer makes a deposit into the Special
Funding Account in respect of a Collection of a Receivable and such Collection
was received by the Servicer in the form of a check which is not honored for any
reason or (ii) the Servicer makes a mistake with respect to the amount of any
Collection and deposits an amount that is less than or more than the actual
amount of such Collection, the Servicer shall appropriately adjust the amount
subsequently deposited into the Special Funding Account to reflect such
dishonored check or mistake. Any Receivable in respect of which a dishonored
check is received shall be deemed not to have been paid. Notwithstanding the
first two sentences of this paragraph, no adjustments shall be made pursuant to
this paragraph that will change any amount of Collections previously reported
pursuant to Section 3.04(c).
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(c) Any Privileged Assets Billed Amounts that remain unpaid 60
days after the date of their initial billing statement shall be treated by the
Servicer in the same manner as a Receivable which the Servicer has adjusted
downward without receiving Collections therefor or without charging off such
amount as uncollectible in accordance with Section 3.08(a), and such adjustment
shall be made on or prior to the end of the Due Period in which such adjustment
obligation arises.
Section 3.09 Remittance Processing Procedures. (a) TRS, as initial
Servicer, hereby represents and warrants to the Trustee (it being acknowledged
that the Trustee has relied on such representation and warranty in accepting the
Receivables and the other property conveyed pursuant to Section 2.01 in trust
and in authenticating the Certificates) that the Remittance Banks listed on
Schedule 4 hereto are, as of the Cut-Off Date, the only institutions holding any
accounts into which TRS deposits payments received through the Payment Service
Centers from Obligors in respect of Accounts. TRS shall be permitted to replace
or delete banks from any new schedule and shall promptly provide a revised
schedule to the Trustee, and prior to depositing any payments received from
Obligors in respect of Accounts with any new bank, it shall deliver to the
Trustee the Lock Box Letter referred to in Section 3.09(b) below executed by TRS
and acknowledged by such bank (each such bank, a "Lock Box Bank").
(a) TRS covenants and agrees that, for the term of this
Agreement, unless otherwise agreed to by the Trustee, it shall deposit all
payments received through the Payment Service Centers from Obligors in respect
of Accounts only into accounts maintained at banks which are Remittance Banks.
TRS agrees to provide prompt notice to the Trustee of any additional Payment
Service Centers.
(b) Within ninety (90) days of the Initial Closing Date, TRS,
as initial Servicer, delivered to the Trustee, with respect to all accounts
maintained at Lock Box Banks into which payments from Obligors in respect of
Accounts are deposited, Lock Box Letters in substantially the form of Exhibit K
attached hereto, each of which was executed on behalf of TRS and acknowledged by
the respective Lock Box Bank.
(c) The Trustee, on behalf of Certificateholders, acknowledges
that the accounts maintained by TRS at the Lock Box Banks will contain funds in
addition to payments made by Obligors in respect of Accounts and that the
conduct of TRS' business as presently conducted will depend on the prompt
receipt by TRS of such funds. The Trustee shall have no right, title or interest
in any funds on deposit in such accounts to the extent that such funds do not
represent payments made by Obligors in respect of Accounts and to the extent the
Trustee is exclusively responsible for instructions to the Lock Box Banks, the
Trustee shall instruct the Lock Box Banks to immediately remit such funds to the
Transferors.
[END OF ARTICLE III]
44
ARTICLE IV
RIGHTS OF CERTIFICATEHOLDERS AND ALLOCATION
AND APPLICATION OF COLLECTIONS
Section 4.01 Establishment of Collection Account and Special Funding
Account and Allocations with Respect to the Exchangeable Transferor's
Certificates.
(a) The Collection Account. The Trustee, for the benefit of
the Certificateholders, shall establish and maintain or cause to be established
and maintained in the name of the Trustee, on behalf of the Trust, with an
Eligible Institution a segregated account (the "Collection Account"), bearing a
designation clearly indicating that the funds deposited therein are held for the
benefit of the Certificateholders. The Trustee shall possess all right, title
and interest in all funds on deposit from time to time in the Collection Account
and in all proceeds thereof. The Collection Account shall be under the sole
dominion and control of the Trustee for the benefit of the Investor
Certificateholders. If, at any time, the institution holding the Collection
Account ceases to be an Eligible Institution, the Trustee (or the Servicer on
its behalf) shall within five Business Days establish a new Collection Account
meeting the conditions specified above with an Eligible Institution, transfer
any cash and/or any investments to such new Collection Account and from the date
such new Collection Account is established, it shall be the Collection Account.
Pursuant to the authority granted to the Servicer in subsection 3.01(b), the
Servicer shall have the power, revocable by the Trustee, to make withdrawals and
payments from the Collection Account and to instruct the Trustee to make
withdrawals and payments from the Collection Account for the purposes of
carrying out the Servicer's or Trustee's duties hereunder.
Each Series of Investor Certificates shall represent interests
in the Trust, including the benefits of any Enhancement to be provided by an
Enhancement Provider issued with respect to such Series as indicated in the
Supplement relating to such Series and the right to receive Collections and
other amounts at the times and in the amounts specified in this Article IV to be
deposited in the Collection Account and any other accounts maintained for the
benefit of the Certificateholders or paid to the Investor Certificateholders.
The Exchangeable Transferor Certificates shall represent the interest in the
Trust not represented by any Series of Investor Certificates then outstanding,
including the right to receive Collections and other amounts at the times and in
the amounts specified in this Article IV to be paid to the Transferors (the
"Transferor Interest"), provided, however, that such Exchangeable Transferor
Certificate shall not represent any interest in the Collection Account and any
other accounts maintained for the benefit of the Certificateholders or the
benefits of any Enhancement to be provided by an Enhancement Provider issued
with respect to any Series, except as specifically provided in this Article IV.
(b) Administration of the Collection Account. At the written
direction of the Servicer, funds on deposit in the Collection Account to be so
invested shall be invested by the Trustee in Eligible Investments. All such
Eligible Investments shall be held by the Trustee for the benefit of the
Certificateholders. Investments of funds representing Collections collected
during any Due Period shall be invested in Eligible Investments that will mature
so that such funds will be available before 11:00 a.m. (New York City time) on
the Distribution Date related to such Due Period. Any funds on deposit in the
Collection Account to be so invested shall be invested solely in Eligible
Investments. All Eligible Investments shall be held by the Trustee for the
benefit of the Certificateholders pursuant to Section 4.02. On each Distribution
Date, all interest and other investment earnings (net of losses and investment
expenses) on funds on deposit in the Collection Account shall be paid to the
Holder of the Exchangeable Transferor Certificate, provided, however, that for
Distribution Dates with respect to any Rapid Amortization Period or Early
Amortization Period such interest and earnings shall be considered Yield
Collections hereunder.
45
(c) Identification of Account. Schedule 2, which is hereby
incorporated into and made a part of this Agreement, identifies the Collection
Account by setting forth the account number of such account, the account
designation of such account and the name of the institution with which such
account has been established.
(d) Allocations For the Exchangeable Transferor Certificate.
Throughout the existence of the Trust, the Servicer shall allocate to the Holder
of the Exchangeable Transferor Certificate an amount equal to the product of (A)
the Transferor Percentage and (B) the aggregate amount of such Collections
allocated to Principal Collections and Yield Collections, respectively, in
respect of such Due Period. Notwithstanding anything to the contrary in
subsection 4.01(g), unless specified in any Supplement, the Servicer need not
deposit this amount, and any other amounts so allocated to the Exchangeable
Transferor Certificate pursuant to any Supplement, into the Collection Account
and shall pay such amounts as collected to the Holder of the Exchangeable
Transferor Certificate.
(e) Allocations of Collections Between Yield Collections and
Principal Collections. At all times and for all purposes of this Agreement and
any Supplement, the Servicer shall allocate all Collections received for any
period between Yield Collections and Principal Collections. Such Collections
shall be allocated such that the product of (i) such Collections and (ii) the
Yield Factor in effect with respect to such period shall be considered Yield
Collections and the remainder of such Collections shall be considered Principal
Collections.
(f) Undistributed Principal Collections. On each Distribution
Date, (A) the Servicer shall allocate Excess Principal Collections to each
Series as set forth in the related Supplement and (B) the Servicer shall
withdraw from the Collection Account and pay to the Transferors (i) an amount
equal to the excess, if any, of (x) the aggregate amount for all outstanding
Series of Principal Collections which the related Supplements specify are to be
treated as "Excess Principal Collections" for such Distribution Date over (y)
the aggregate amount for all outstanding Series which the related Supplements
specify are "Principal Shortfalls" for such Distribution Date and, without
duplication, (ii) the aggregate amount for all outstanding Series of that
portion of Principal Collections which the related Supplements specify are to be
allocated and paid to the Transferors with respect to such Distribution Date;
provided, however, that such amounts shall be paid to the Transferors only if
the Transferor Amount (determined after giving effect to any Receivables
transferred to the Trust on such date) exceeds 3% of the Trust Principal
Component. The amount held in the Collection Account as a result of the proviso
in the preceding sentence ("Undistributed Principal Collections") shall be paid
to the Transferors at the time the Transferor Amount as a percentage of the
Trust Principal Component exceeds 3%; provided, however, that any Undistributed
Principal Collections on deposit in the Collection Account at any time during
which any Series is in its Amortization Period or Accumulation Period shall be
allocated and distributed in accordance with the terms of each Supplement.
46
(g) Collections. All payments received by the Servicer in
respect of Accounts and applied by the Servicer to payment of Privileged Assets
Billed Amounts shall be treated in the same manner as Collections with respect
to the Receivables for purposes of this Agreement. The Servicer will apply all
Collections with respect to the Receivables for each Due Period as described in
this Article IV and each Supplement. Except as otherwise provided below, the
Servicer shall deposit Collections into the Collection Account on the Date of
Processing of such Collections. Subject to the express terms of any Supplement,
but notwithstanding anything else in this Agreement to the contrary, for so long
as, and only so long as, TRS or an Affiliate of TRS shall be the Servicer
hereunder and (i) maintain a short-term credit rating (which may be an implied
rating) of P-1 by ▇▇▇▇▇'▇ and of A-1 by Standard & Poor's, or (ii) obtain a
guarantee with respect to the Servicer's deposit and payment obligations
hereunder pursuant to a guaranty in form and substance acceptable to each Rating
Agency provided the guarantor maintains a short-term credit rating of P-1 by
▇▇▇▇▇'▇ and of A-1+ by Standard & Poor's, or (iii) obtains a written
notification from each Rating Agency to the effect that such Rating Agency does
not intend to downgrade or withdraw its then current rating of any outstanding
Series of Certificates despite the Servicer's inability to satisfy the rating
requirement specified in clause (i), and for two Business Days following any
reduction of either such rating or failure to satisfy the conditions of either
clause (ii) or (iii), the Servicer may, but need not, deposit Collections or
amounts received from the Transferors pursuant to subsection 2.04(d)(iii) or
subsection 3.08(a) into the Collection Account or make payments to the holder of
the Exchangeable Transferor Certificate prior to the close of business on the
Date of Processing, but rather may make a single deposit in the Collection
Account in immediately available funds on the Business Day prior to each
Distribution Date in an amount equal to the sum of amounts received from the
Transferors pursuant to subsection 2.04(d)(iii) and subsection 3.08(a) with
respect to the Due Period for each such Distribution Date and the Collections
with respect to the Due Period for each such Distribution Date to the extent
such amounts and Collections are allocated to the Investor Certificateholders in
accordance with Article IV. Collections shall not be required to be invested in
Eligible Investments until such time as they are deposited into the Collection
Account. The Servicer shall notify the Trustee of any downgrade or withdrawal of
its short-term credit rating.
Should the Servicer be required to make daily deposits of
Collections into the Collection Account pursuant to this subsection, during any
Amortization Period or Accumulation Period, the Servicer may cease depositing
Principal Collections received in any Due Period and allocable to a Series in
any Amortization Period or Accumulation Period at such time as an amount of
Principal Collections allocable to such Series and deposited into the Collection
Account or Principal Funding Account, as applicable, equals the amount of
principal scheduled or permitted to be paid or deposited on the next succeeding
Distribution Date with respect to such Series. Principal Collections allocable
to such Series in excess of such amount shall, subject to the provisos in
subsection 4.01(f) and the next succeeding paragraph, be distributed on a daily
basis as they are collected to the Transferors.
47
Should the Servicer be required to make daily deposits of
Collections into the Collection Account pursuant to this subsection, during any
Amortization Period or Accumulation Period, the Servicer may cease depositing
Excess Principal Collections received with respect to a Due Period at such time
as such Excess Principal Collections deposited into the Collection Account or
Principal Funding Account, as applicable, with respect to each Series in an
Amortization Period or Accumulation Period together with Principal Collections
allocable to such Series and deposited into the Collection Account with respect
to such Due Period equals the amount of principal scheduled or permitted to be
paid or deposited with respect to such Series on the next succeeding
Distribution Date.
Should the Servicer be required to make daily deposits of
Collections in the Collection Account or Principal Funding Account pursuant to
this subsection, Excess Principal Collections in excess of amounts allocable to
Series which are in their Amortization Period or Accumulation Period and
deposited in the Collection Account or Principal Funding Account, as applicable,
pursuant to the preceding sentence shall, subject to the provisos in subsection
4.01(f), be distributed to the Transferors on a daily basis.
(h) The Special Funding Account. The Trustee, for the benefit
of the Certificateholders, shall establish and maintain or cause to be
established and maintained in the name of the Trustee, on behalf of the Trust,
with an Eligible Institution a segregated account (the "Special Funding
Account"), bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Certificateholders. The Trustee shall
possess all right, title and interest in all funds on deposit from time to time
in the Special Funding Account and in all proceeds thereof. The Special Funding
Account shall be under the sole dominion and control of the Trustee for the
benefit of the Investor Certificateholders. If, at any time, the institution
holding the Special Funding Account ceases to be an Eligible Institution, the
Trustee (or the Servicer on its behalf) shall within five Business Days
establish a new Special Funding Account meeting the conditions specified above
with an Eligible Institution, transfer any cash and/or any investments to such
new Special Funding Account and from the date such new Special Funding Account
is established, it shall be the Special Funding Account. Pursuant to the
authority granted to the Servicer in subsection 3.01(b), the Servicer shall have
the power, revocable by the Trustee, to make withdrawals and payments from the
Special Funding Account and to instruct the Trustee to make withdrawals and
payments from the Special Funding Account for the purposes of carrying out the
Servicer's or Trustee's duties hereunder.
(i) Administration of the Special Funding Account. At the
written direction of the Servicer, funds on deposit in the Special Funding
Account to be so invested shall be invested by the Trustee in Eligible
Investments. All such Eligible Investments shall be held by the Trustee for the
benefit of the Certificateholders. Investments of funds representing Collections
collected during any Due Period shall be invested in Eligible Investments that
will mature so that such funds will be available before 11:00 a.m. (New York
City time) on the Distribution Date related to such Due Period. Any funds on
deposit in the Special Funding Account to be so invested shall be invested
solely in Eligible Investments. All Eligible Investments shall be held by the
Trustee for the benefit of the Certificateholders pursuant to Section 4.02. On
each Distribution Date, all interest and other investment earnings (net of
losses and investment expenses) on funds on deposit in the Special Funding
Account shall be paid to the Holder of the Exchangeable Transferor Certificate,
provided, however, that for Distribution Dates with respect to any Rapid
Amortization Period or Early Amortization Period such interest and earnings
shall be considered Yield Collections hereunder. The Servicer shall deposit all
amounts received from the Transferors pursuant to subsection 2.04(d)(iii) and
all Adjustment Payments received from the Transferors pursuant to subsection
3.08(a) in the Special Funding Account on the Date of Processing of such
payments.
48
The Transferors may, at their option, instruct the Trustee to
deposit into the Special Funding Account Trust Excess Principal Collections
which are otherwise payable to the Transferors pursuant to the provisions set
forth above. On each Business Day on which funds are on deposit in the Special
Funding Account and on which no Series is in an Early Accumulation Period or
Early Amortization Period, the Servicer shall determine the amount (if any) by
which the Transferor Amount as a percentage of the Trust Principal Component
exceeds the Minimum Transferor Percentage on such date and may instruct the
Trustee to withdraw any such excess from the Special Funding Account and pay
such amount to the Transferors; provided, however, that, if an Accumulation
Period or Amortization Period has commenced and is continuing with respect to
one or more outstanding Series, any funds on deposit in the Special Funding
Account shall be treated as Trust Excess Principal Collections and shall be
allocated and distributed in accordance with this Article IV and the terms of
each Supplement.
Schedule 2 identifies the Special Funding Account by setting
forth the account number of such account, the account designation of such
account and the name of the institution with which such account has been
established.
Section 4.02 Manner of Holding Trust Property. Each item of
Trust Property that constitutes a security entitlement shall be held by the
Trustee through a securities intermediary, and The Bank of New York, as initial
securities intermediary shall agree that (i) such investment property at all
times shall be credited to a securities account of the Trustee, (ii) all
property credited to such securities account shall be treated as a financial
asset, (iii) it shall treat the Trustee as entitled to exercise the rights that
comprise each financial asset credited to such securities account, (iv) it shall
comply with entitlement orders originated by the Trustee without the further
consent of any other Person, (v) it shall not agree with any Person other than
the Trustee to comply with entitlement orders originated by any Person other
than the Trustee, (vi) such securities account and all property credited thereto
shall not be subject to any lien, security interest, right of set-off, or
encumbrance in favor of it or any Person claiming through it (other than the
Trustee), (vii) such agreement between it and the Trustee shall be governed by
the laws of the State of New York, and (viii) the State of New York shall be the
jurisdiction for purposes of the UCC. The Trustee shall maintain possession in
the State of New York of each item of Trust Property that constitutes money, an
instrument, tangible chattel paper, or a certificated security, separate and
apart from all other property held by the Trustee. The issuer of any Trust
Property that constitutes an uncertificated security shall register the Trustee
as the registered owner of such uncertificated security. Any Trust Property that
constitutes a deposit account shall be established and maintained in the name of
the Trustee by a bank, the Relevant UCC State of which is the State of New York.
Notwithstanding any other provision of this Agreement, the Trustee shall not
hold any Trust Property through an agent except as expressly permitted by this
Section 4.02. Each term used in this Section 4.07 and defined in the New York
UCC shall have the meaning set forth in the New York UCC.
49
[THE REMAINDER OF ARTICLE IV IS RESERVED
AND MAY BE SPECIFIED IN ANY SUPPLEMENT
WITH RESPECT TO ANY SERIES]
ARTICLE V
[ARTICLE V IS RESERVED AND
MAY BE SPECIFIED IN ANY SUPPLEMENT
WITH RESPECT TO ANY SERIES]
50
ARTICLE VI
THE CERTIFICATES
Section 6.01 The Certificates. Subject to Sections 6.10 and 6.11, the
Investor Certificates of each Series and any class thereof may be issued in
bearer form (the "Bearer Certificates") with attached interest coupons and a
special coupon (collectively, the "Coupons") or in fully registered form (the
"Registered Certificates"), and shall be substantially in the form of the
exhibits with respect thereto attached to the applicable Supplement. The
Exchangeable Transferor Certificate shall be substantially in the form of
Exhibit A. The Investor Certificates and the Exchangeable Transferor Certificate
shall, upon issue pursuant hereto or to Section 6.09 or Section 6.11, be
executed and delivered by the Transferors to the Trustee for authentication and
redelivery as provided in Section 6.02. Any Investor Certificates shall be
issued in minimum denominations of $1,000 and in integral multiples of $1,000 in
excess thereof, unless otherwise specified in any Supplement. If specified in
the related Supplement for any Series, the Investor Certificates shall be issued
upon initial issuance as a single certificate in an original principal amount
equal to the Initial Invested Amount as described in Section 6.10. The
Exchangeable Transferor Certificate may also be issued in two or more
certificates. Each Certificate shall be executed by manual or facsimile
signature on behalf of the Transferors by their respective Chairman of the
Board, President, Vice Chairman of the Board or any Vice President. Certificates
bearing the manual or facsimile signature of the individual who was, at the time
when such signature was affixed, authorized to sign on behalf of each such
Transferor or the Trustee shall not be rendered invalid, notwithstanding that
such individual has ceased to be so authorized prior to the authentication and
delivery of such Certificates or does not hold such office at the date of such
Certificates. No Certificate shall be entitled to any benefit under this
Agreement or any applicable Supplement or be valid for any purpose unless there
appears on such Certificate a certificate of authentication substantially in the
form provided for herein executed by or on behalf of the Trustee by the manual
signature of a duly authorized signatory, and such certificate upon any
Certificate shall be conclusive evidence, and the only evidence that such
Certificate has been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication, except Bearer
Certificates which shall be dated the Issuance Date.
Section 6.02 Authentication of Certificates. Contemporaneously with the
assignment and transfer of the Receivables, whether now existing or hereafter
created, and the other Trust Property to the Trust, the Trustee authenticated
and delivered the initial Series of Investor Certificates issued upon original
issuance, upon the order of the Transferors, to the underwriters. The Trustee
authenticated and delivered the Exchangeable Transferor Certificate to the
Transferors simultaneously with its delivery of the initial Series of Investor
Certificates. Upon an Exchange as provided in Section 6.09 of the Agreement and
the satisfaction of certain other conditions specified therein, the Trustee
shall authenticate and deliver the Investor Certificates of additional Series
(with the designation provided in the applicable Supplement), upon the order of
the Transferors, to the Persons designated in such Supplement. Upon the order of
the Transferors, the Certificates of any Series shall be duly authenticated by
or on behalf of the Trustee, in authorized denominations equal to (in the
aggregate) the Initial Invested Amount of such Series of Investor Certificates.
If specified in the related Supplement for any Series, the Trustee shall
authenticate and deliver outside the United States the Global Certificate that
is issued upon original issuance thereof, upon the written order of the
Transferors, to the Common Depositary as provided in Section 6.10 against
payment of the purchase price therefor. If specified in the related Supplement
for any Series, the Trustee shall authenticate Book-Entry Certificates that are
issued upon original issuance thereof, upon the written order of the
Transferors, to a Clearing Agency or its nominee as provided in Section 6.11
against payment of the purchase price thereof.
51
Section 6.03 Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at the office or agency
to be maintained by a transfer agent and registrar (which may be the Trustee)
(the "Transfer Agent and Registrar") in accordance with the provisions of
subsection 6.03(c) of the Agreement a register (the "Certificate Register") in
which, subject to such reasonable regulations as it may prescribe, the Transfer
Agent and Registrar shall provide for the registration of the Registered
Certificates and of transfers and exchanges of the Registered Certificates as
herein provided. The Trustee is hereby initially appointed Transfer Agent and
Registrar for the purpose of registering the Registered Certificates and
transfers and exchanges of the Registered Certificates as herein provided. The
Trustee shall be permitted to resign as Transfer Agent and Registrar upon 30
days' written notice to the Transferors and the Servicer; provided, however,
that such resignation shall not be effective and the Trustee shall continue to
perform the duties of Transfer Agent and Registrar until the Transferors have
appointed a successor Transfer Agent and Registrar acceptable to the Transferors
and the Trustee. If specified in the related Supplement for any Series of
Certificates, the Transferors shall appoint any co-transfer agent and
co-registrar chosen by the Transferors, and acceptable to the Trustee,
including, if and so long as the Registered Certificates are listed on the
Luxembourg Stock Exchange or other stock exchange and such exchange shall so
require, a co-transfer agent and co-registrar in Luxembourg or the location
required by such other stock exchange. If specified in such related Supplement,
so long as the Registered Certificates relating to such Supplement are
outstanding, the Transferors shall maintain a co-transfer agent and co-registrar
in New York City or any other city designated in such Supplement and any
reference in this Agreement to the Transfer Agent and Registrar shall include
any co-transfer agent and co-registrar unless the context requires otherwise.
Upon surrender for registration of transfer of any Registered
Certificate at any office or agency of the Transfer Agent and Registrar
maintained for such purpose, the Transferors shall execute, and the Trustee
shall authenticate and deliver, in the name of the designated transferee or
transferee one or more new Registered Certificates in authorized denominations
of the same Series representing like aggregate Undivided Interests in the Trust;
provided, however, that the provisions of this paragraph shall not apply to
Bearer Certificates.
At the option of any Registered Certificateholder, Registered
Certificates may be exchanged for other Registered Certificates of the same
Series in authorized denominations of like aggregate Undivided Interests in the
Trust, upon surrender of the Registered Certificates to be exchanged at any
office or agency of the Transfer Agent and Registrar maintained for such
purpose. At the option of a Bearer Certificateholder, subject to applicable laws
and regulations, Bearer Certificates may be exchanged for other Bearer
Certificates or Registered Certificates of the same Series in authorized
denominations of like aggregate Undivided Interests in the Trust, upon surrender
of the Bearer Certificates to be exchanged at an office or agency of the
Transfer Agent and Registrar located outside the United States, Each Bearer
Certificate surrendered pursuant to this Section 6.03 shall have attached
thereto all unmatured Coupons, provided that any Bearer Certificate so
surrendered after the close of business on the Record Date preceding the
relevant Distribution Date after the related Series Termination Date need not
have attached the Coupon relating to such Distribution Date.
52
The preceding provisions of this Section 6.03 notwithstanding
the Trustee or the Transfer Agent and Registrar, as the case may be, shall not
be required to register the transfer of or exchange of any Certificate of any
Series for a period of 15 days preceding the due date for any payment with
respect to the Certificates of such Series.
Whenever any Investor Certificates of any Series are so
surrendered for exchange, the Transferors shall execute, and the Trustee shall
authenticate and the Transfer Agent and Registrar shall deliver (in the case of
Bearer Certificates, outside the United States), the Investor Certificates of
such Series which the Certificateholder making the exchange is entitled to
receive. Every Investor Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer in
a form satisfactory to the Trustee and the Transfer Agent and Registrar duly
executed by the Certificateholder thereof or his attorney duly authorized in
writing.
Except as provided in any Supplement, no service charge shall
be made for any registration of transfer or exchange of Investor Certificates,
but the Transfer Agent and Registrar and the Trustee or any co-transfer agent
and co-registrar or co-trustee may require payment of a sum sufficient to cover
any tax or governmental charge that may be imposed in connection with any
transfer or exchange of Investor Certificates.
All Investor Certificates (together with any Coupons attached
to Bearer Certificates) surrendered for registration of transfer or exchange
shall be cancelled by the Transfer Agent and Registrar and disposed of in a
manner satisfactory to the Trustee and the Transferors. The Trustee shall cancel
and mutilate the Global Certificate upon its exchange in full for Definitive
Certificates and shall deliver such cancelled and mutilated Global Certificate
to the Transferors. The Trustee shall also forward to the Transferors a copy of
each certificate of each Foreign Clearing Agency to the effect referred to in
Section 6.10 of the Agreement which was received by the Trustee with respect to
each portion of the Global Certificate exchanged for Definitive Certificates.
The Transferors shall execute and deliver to the Trustee or
the Transfer Agent and Registrar, as applicable, Bearer Certificates and
Registered Certificates in such amounts and at such times as are necessary to
enable the Trustee to fulfill its responsibilities under this Agreement and the
Certificates.
(b) Except as provided in Sections 6.09 and 7.02, the
Transferors' interest in the Exchangeable Transferor Certificate shall not be
sold, transferred, assigned, exchanged, pledged, participated or otherwise
conveyed, unless (A) (i) the Servicer has delivered to the Trustee an Officer's
Certificate stating that such sale, transfer, assignment, exchange, pledge or
conveyance will not, while any Series of Certificates remains outstanding,
reduce the Transferors' retained interest in the Exchangeable Transferor
Certificate below the Minimum Transferor Percentage for any Series then
outstanding and (ii) the Trustee receives prior to such sale, transfer,
assignment, exchange, pledge, participation or conveyance written confirmation
from each Rating Agency that such transfer, assignment, exchange, pledge,
participation or conveyance will not result in such Rating Agency's reducing or
withdrawing its rating on any then outstanding Series rated by it or (B) such
transfer, assignment, exchange, pledge or conveyance is made to CRC and, in the
case of (A), the Trustee receives prior thereto an Opinion of Counsel to the
effect that (x) the conveyed interest in the Transferor Exchangeable Certificate
will be treated as either debt or an interest in a partnership for Federal
income tax purposes and that the conveyance of such interest will not cause the
Trust to be characterized for Federal income tax purposes as an association
taxable as a corporation or otherwise have any material adverse impact on the
Federal or applicable state income taxation of any outstanding Series of
Investor Certificates or any Certificate Owner and (y) such transfer will not
cause a taxable event for federal income tax purposes to any Investor
Certificateholder.
53
(c) The Transfer Agent and Registrar will maintain at its
expense in the Borough of Manhattan, the City of New York (and, if specified in
the related Supplement for any Series, Luxembourg (or subject to Section 6.03(a)
of the Agreement any other city designated in such Supplement)), an office or
offices or agency or agencies where Investor Certificates may be surrendered for
registration of transfer or exchange (except that Bearer Certificates may not be
surrendered for exchange at any such office or agency in the United States).
(d) Unless otherwise provided in any related Supplement,
registration of transfer of Registered Certificates containing a legend relating
to the restrictions on transfer of such Registered Certificates (which legend
shall be set forth in the Supplement relating to such Investor Certificates)
shall be effected only if:
(i) (a) the sale is of at least U.S $500,000 principal amount
of such Certificates and (b) a letter from the purchaser satisfactory
to counsel to the Servicer is executed and received; or
(ii) (a) the Registered Certificates are transferred in
compliance with Rule 144 (or any amendment thereto) or Rule 144A (or
any amendment thereto) under the United States Securities Act of 1933,
as amended, and (b) a letter from the purchaser satisfactory to counsel
to the Servicer is executed and received; or
(iii) the Registered Certificates are sold or otherwise
transferred in any other transaction that does not require registration
under the United States Securities Act of 1933 as amended, and, if the
Transferor, the Servicer, the Trustee, the Transfer Agent or Registrar
so request, an Opinion of Counsel satisfactory to it, in form and
substance satisfactory to it, is furnished to such effect.
Registered Certificates issued upon registration of transfer
of, or Registered Certificates issued in exchange for, Registered Certificates
bearing the legend referred to above shall also bear such legend unless the
Transferor, the Servicer, the Trustee and the Transfer Agent and Registrar
receive an Opinion of Counsel satisfactory to each of them, to the effect that
such legend may be removed.
54
Whenever a Registered Certificate containing the legend set
forth in the related Supplement is presented to the Transfer Agent and Registrar
for registration of transfer, the Transfer Agent and Registrar shall promptly
seek written instructions from the Servicer regarding such transfer. The
Transfer Agent and Registrar and the Trustee shall be entitled to receive
written instructions signed by a Servicing Officer prior to registering any such
transfer or authenticating new Retired Certificates, as the case may be. The
Servicer hereby agrees to indemnify the Transfer Agent and Registrar and the
Trustee and to hold each of them harmless against any loss, liability or expense
incurred without bad faith on their part arising out of or in connection with
actions taken or omitted by them in reliance on and in accordance with any such
written instructions furnished pursuant to this subsection 6.03(d).
Section 6.04 Mutilated, Destroyed, Lost, or Stolen Certificates. If
(a) any mutilated Certificate (together, in the case of Bearer Certificates,
with all unmatured Coupons (if any) appertaining thereto) is surrendered to the
Transfer Agent and Registrar, or the Transfer Agent and Registrar receives
evidence to its satisfaction of the destruction, loss or theft of any
Certificate and (b) there is delivered to the Transfer Agent and Registrar, the
Trustee and the Transferors such security or indemnity as may be required by
them to save each of them harmless, then, in the absence of notice to the
Trustee that such Certificate has been acquired by a protected purchaser, the
Transferors shall execute and the Trustee shall authenticate and the Transfer
Agent and Registrar shall deliver (in the case of Bearer Certificates, outside
the United States), in exchange for or in lieu of any such mutilated, destroyed,
lost or stolen Certificate, a new Certificate of like tenor and aggregate
Undivided Interest, if applicable, In connection with the issuance of any new
Certificate under this Section 6.04, the Trustee or the Transfer Agent and
Registrar may require the payment by the Certificateholder of a sum sufficient
to cover any tax or other governmental expenses (including the fees and expenses
of the Trustee and Transfer Agent and Registrar) connected therewith. Any
duplicate Certificate issued pursuant to this Section 6.04 shall constitute
complete and indefeasible evidence of ownership in the Trust, as if originally
issued, whether or not the lost, stolen or destroyed Certificate shall be found
at any time.
Section 6.05 Persons Deemed Owners. Prior to due presentation of a
Certificate (other than a Bearer Certificate) for registration of transfer, the
Trustee, the Paying Agent, the Transfer Agent and Registrar and any agent of any
of them may treat the person in whose name any Certificate is registered as the
owner of such Certificate for the purpose of receiving distributions pursuant to
Article IV hereof and for all other purposes whatsoever, and neither the
Trustee, the Paying Agent, the Transfer Agent and Registrar nor any agent of any
of them shall be affected by any notice to the contrary, In. the case of a
Bearer Certificate, the Trustee, the Paying Agent, the Transfer Agent and
Registrar and any agent of any of them may treat the bearer of a Bearer
Certificate or Coupon as the owner of such Bearer Certificate or Coupon for the
purpose of receiving distributions pursuant to Article IV and for all other
purposes whatsoever, and neither the Trustee, the Paying Agent, the Transfer
Agent and Registrar nor any agent of any of them shall be affected by any notice
to the contrary. Notwithstanding the foregoing provisions of this Section 6.05,
in determining whether the holders of the requisite interests have given any
request, demand, authorization, direction, notice, consent or waiver hereunder
Certificates owned by the Transferor, the Servicer or any affiliate thereof (as
defined in Rule 405 under the Securities Act of 1933, as amended), shall be
disregarded and deemed not to be outstanding, except that, in determining
whether the Trustee shall be protected in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Certificates which the
Trustee knows to be so owned shall be so disregarded. Certificates so owned
which have been pledged in good faith shall not be disregarded and may be
regarded as outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Certificates and that
the pledgee is not the United States, the Servicer or an affiliate thereof (as
defined above).
55
Section 6.06 Appointment of Paying Agent. The Paying Agent shall make
distributions to Investor Certificateholders from the Collection Account (or any
other account or accounts maintained for the benefit of Certificateholders as
specified in the related Supplement for any Series) pursuant to Articles IV and
V hereof. Any Paying Agent shall have the revocable power to withdraw funds from
the Collection Account (or any other account or accounts maintained for the
benefit of Certificateholders as specified in the related Supplement for any
Series) for the purpose of making distributions referred to above. The Trustee
may revoke such power and remove the Paying Agent if the Trustee determines in
its sole discretion that the Paying Agent shall have failed to perform its
obligations under this Agreement in any material respect. The Paying Agent shall
initially be the Trustee and any co-paying agent chosen by the Transferors and
acceptable to the Trustee, including, if and so long as any Series of Investor
Certificates is listed on the Luxembourg Stock Exchange or other stock exchange
and such exchange so requires, a co-paying agent in Luxembourg or the location
of such other stock exchange. The Trustee shall be permitted to resign as Paying
Agent upon 30 days' written notice to the Servicer and the Transferors. The
Transferors shall notify the Rating Agencies of any resignation or replacement
of the Paying Agent. In the event that the Trustee shall no longer be the Paying
Agent, the Transferors shall appoint a successor to act as Paying Agent and such
successor shall be acceptable to the Trustee. The Trustee shall cause the
initial Paying Agent and each successor Paying Agent or any additional Paying
Agent appointed by the Transferors to execute and deliver to the Trustee an
instrument in which such initial or successor Paying Agent or additional Paying
Agent shall agree with the Trustee that, as Paying Agent, such initial or
successor Paying Agent or additional Paying Agent will hold all sums, if any,
held by it for payment to the Investor Certificateholders in trust for the
benefit of the Investor Certificateholders entitled thereto until such sums
shall be paid to such Certificateholders. The Paying Agent shall return all
unclaimed funds to the Trustee and upon removal of a Paying Agent shall also
return all funds in its possession to the Trustee. The provisions of Sections
11.01, 11.02 and 11.03 of the Agreement shall apply to the Trustee also in its
role as Paying Agent, for so long as the Trustee shall act as Paying Agent. Any
reference in this Agreement to the Paying Agent shall include any co-paying
agent unless the context requires otherwise.
If specified in the related Supplement for any Series, so long
as the Investor Certificates of such Series are outstanding, the Transferors
shall, if the Paying Agent is not located in New York City, appoint a co-paying
agent in New York City (for Registered Certificates only) acceptable to the
Trustee or any other city designated in such Supplement which, if and so long as
any Series of Investor Certificates is listed on the Luxembourg Stock Exchange
or other stock exchange and such exchange so requires, shall be in Luxembourg or
the location required by such other stock exchange.
56
Section 6.07 Access to List of Certificateholders' Names and Addresses.
The Trustee will furnish or cause to be furnished by the Transfer Agent and
Registrar to the Servicer or the Paying Agent (or any agent thereof), within
five Business Days after receipt by the Trustee of a request therefor from the
Servicer or the Paying Agent, respectively, in writing, a list in the form
maintained by the Trustee, of the names and addresses of the Investor
Certificateholders (other than Bearer Certificateholders). If Holders
representing Undivided Interests in the Trust aggregating not less than 10% of
the Invested Amount of the Investor Certificates of such Series (the
"Applicants") apply in writing to the Trustee, and such application states that
the Applicants desire to communicate with other Investor Certificateholders of
such Series with respect to their rights under this Agreement or under the
Investor Certificates and is accompanied by a copy of the communication which
such Applicants propose to transmit, then the Trustee, after having been
adequately indemnified by such Applicants for its costs and expenses, shall
afford or shall cause the Transfer Agent and Registrar to either afford such
Applicants access during normal business hours to the most recent list of
Certificateholders (other than Bearer Certificateholders) held by the Trustee,
or mail or cause to be mailed such list within five Business Days after the
receipt of such application. Such list shall be as of a date no more than 45
days prior to the date of receipt of such Applicants' request.
Every Certificateholder, by receiving and holding a
Certificate agrees with the Trustee that neither the Trustee, the Transfer Agent
and Registrar, nor any of their respective agents shall be held accountable by
reason of the disclosure of any such information as to the names and addresses
of the Certificateholder (other than Bearer Certificateholders) hereunder,
regardless of the sources from which such information was derived.
Section 6.08 Authenticating Agent.
(a) The Trustee may appoint one or more authenticating agents
with respect to the Certificates which shall be authorized to act on behalf of
the Trustee in authenticating the Certificates in connection with the issuance,
delivery, registration of transfer, exchange or repayment of the Certificates.
Whenever reference is made in this Agreement to the authentication of
Certificates by the Trustee or the Trustee's certificate of authentication, such
reference shall be deemed to include authentication on behalf of the Trustee by
an authenticating agent and a certificate of authentication executed on behalf
of the Trustee by an authenticating agent. Each authenticating agent must be
reasonably acceptable to the Transferors.
(b) Any institution succeeding to the corporate agency
business of an authenticating agent shall continue to be an authenticating agent
without the execution or filing of any paper or any further act on the part of
the Trustee or such authenticating agent.
(c) An authenticating agent may at any time resign by giving
written notice of resignation to the Trustee and to the Transferor. The Trustee
may at any time terminate the agency of an authenticating agent by giving notice
of termination to such authenticating agent and to the Transferors. Upon
receiving such a notice of resignation or upon such a termination, or in case at
any time an authenticating agent shall cease to be acceptable to the Trustee or
the Transferors, the Trustee promptly may appoint a successor authenticating
agent. Any successor authenticating agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
authenticating agent. No successor authenticating agent shall be appointed
unless acceptable to the Trustee and the Transferors.
57
(d) The Servicer agrees to pay, on behalf of the Trust, to
each authenticating agent from time to time reasonable compensation for its
services under this Section 6.08.
(e) The provisions of Sections 11.01, 11.02 and 11.03 of the
Agreement shall be applicable to any authenticating agent.
(f) Pursuant to an appointment made under this Section 6.08,
the Certificates may have indorsed thereon, in lieu of the Trustee's certificate
of authentication, an alternate certificate of authentication, in substantially
the following form:
This is one of the Certificates described in the Master
Pooling and Servicing Agreement.
-----------------------------------------
-----------------------------------------
as Authenticating Agent
for the Trustee,
By:______________________________________
Authorized Officer
Section 6.09 Tender of Exchangeable Transferor Certificate.
(a) Upon any Exchange, the Trustee shall issue to the
Transferors under Section 6.01 of the Agreement for execution and redelivery to
the Trustee for authentication under Section 6.02 of the Agreement one or more
new Series of Investor Certificates. Any such Series of Investor Certificates
shall be substantially in the form specified in the applicable Supplement and
shall bear, upon its face, the designation for such Series to which it belongs
so selected by the Transferors. Except as specified in any Supplement for a
related Series, all Investor Certificates of any Series shall be equally and
ratably entitled as provided herein to the benefits hereof without preference,
priority or distinction on account of the actual time or times of authentication
and delivery, all in accordance with the terms and provisions of this Agreement
and the applicable Supplement.
(b) The Transferors may tender the Exchangeable Transferor
Certificate to the Trustee in exchange for (i) one or more newly issued Series
of Investor Certificates and (ii) a reissued Exchangeable Transferor Certificate
(any such tender an "Exchange"). The Transferors may perform an Exchange by
notifying the Trustee, in writing at least three days in advance (an "Exchange
Notice") of the date upon which the Exchange is to occur (an "Exchange Date").
Any Exchange Notice shall state the designation of any Series to be issued on
the Exchange Date and, with respect to each such Series: (x) its Initial
Invested Amount (or the method for calculating such Initial Invested Amount), if
any, which, in the aggregate, at any time, may not be greater than the current
principal amount of the Exchangeable Transferor Certificate less the product of
the Minimum Transferor Percentage and. the Trust Principal Component at such
time, and (y) its Certificate Rate (or the method for allocating interest
payments or other cash flow to such Series), if any. On the Exchange Date, the
Trustee shall only authenticate and deliver any such Series upon delivery to it
of the following: (A) a Supplement in form satisfactory to the Trustee executed
by the Transferors and specifying the Principal Terms of such Series, (B) the
applicable Enhancement, if any, (C) an opinion of Counsel to the effect that the
newly issued Series of Investor Certificates will be characterized as either
indebtedness or an interest in a partnership under existing law for Federal
income tax purposes and that the issuance of the newly issued Series of Investor
Certificates will not have any material adverse impact on the Federal income tax
characterization of any outstanding Series of Investor Certificates that have
been the subject of a previous opinion of tax counsel, (D) an agreement, if any,
pursuant to which the Enhancement Provider agrees to provide Enhancement, (E)
written confirmation from each Rating Agency that the Exchange will not result
in such Rating Agency's reducing or withdrawing its rating on any then
outstanding Series rated by it and (F) the existing Exchangeable Transferor
Certificate. Upon satisfaction of such conditions, the Trustee shall cancel the
existing Exchangeable Transferor Certificate and issue, as provided above, such
Series of Investor Certificates and new Exchangeable Transferor Certificate,
dated the Exchange Date.
58
(c) In conjunction with an Exchange, the parties hereto shall
execute a Supplement, which shall specify the relevant terms with respect to any
Series of Investor Certificates, which may include, without limitation: (i) its
name or designation, (ii) an Initial Invested Amount or the method of
calculating the Initial Invested Amount, (iii) a Certificate Rate (or formula
for the determination thereof), (iv) the rights of the Holders of the
Exchangeable Transferor Certificate that have been transferred to the Holders of
such Series pursuant to such Exchange (including any rights to allocations of
Yield Collections and Principal Collections), (v) the interest payment date or
dates and the date or dates from which interest shall accrue, (vi) the method of
allocating Principal Collections for such Series and, if applicable, with
respect to other Series and the method by which the principal amount of Investor
Certificates of such Series shall amortize or accrete and the method for
allocating Yield Collections and Receivables in Defaulted Accounts, (vii) the
names of any accounts to be used by such Series and the terms governing the
operation of any such account, (viii) the Servicing Fee Percentage, (ix) the
Minimum Transferor Percentage, (x) the Minimum Trust Principal Component, (xi)
the Series Termination Date, (xii) the terms of any Enhancement, (xiii) the
Enhancement Provider, (xiv) the base rate, if any, (xv) the Repurchase Terms or
the terms on which the Certificates of such Series may be remarketed to other
investors, (xvi) any deposit into any account provided for such Series, (xvii)
the number of Classes of such Series, and if more than one Class, the rights and
priorities of each such Class, (xviii) the extent to which the Investor
Certificates will be issuable in temporary or permanent global form, and in such
case, the depository for such global certificate or certificates, the terms and
conditions, if any, upon which such global certificate may be exchanged in whole
or in part for Definitive Certificates, and the manner in which any interest
payable on a temporary or global certificate will be paid, (xix) whether the
Certificates may be issued in bearer form and any limitations imposed thereon,
(xx) the priority of any Series with respect to any other Series, (xxi) whether
such Series will be an Excess Allocation Series, and (xxii) any other relevant
terms of such Series (all such terms, the "Principal Terms" of such Series). If
on the date of the issuance of such Series there is issued and outstanding no
Series of Investor Certificates which is currently rated by a Rating Agency,
then as a condition to such Exchange a nationally recognized investment banking
firm or commercial bank shall also deliver to the Trustee an officer's
certificate stating, in substance, that the Exchange will not have an adverse
effect on the timing or distribution of payments to such other Series of
Investor Certificates then issued and outstanding.
59
Section 6.10 Global Certificate; Euro Certificate Exchange Date.
(a) If specified in the related Supplement for any Series, the
Investor Certificates may be initially issued in the form of a single temporary
Global Certificate (the "Global Certificate") in bearer form, without interest
coupons, in the denomination of the Initial Invested Amount and substantially in
the form attached to the applicable Supplement. Unless otherwise specified in
the applicable Supplement, the provisions of this Section 6.10 shall apply to
such Global Certificate. The Global Certificate will be authenticated by the
Trustee upon the same conditions, in substantially the same manner and with the
same effect as the Definitive Certificates, The Global Certificate may be
exchanged as described below for Bearer and/or Registered Certificates in
definitive form (the "Definitive Euro-Certificates"). Notwithstanding the
foregoing, no Certificates shall be issued in bearer form unless the Transferors
have determined, and deliver an Opinion of Counsel to the Trustee substantially
to the effect that, the terms and procedures governing issuance and transfer of
such Certificates result in favorable treatment to Investor Certificateholders
under the Bearer Rules.
(b) The Manager shall, upon its determination of the date of
completion of the distribution of the Certificates, so advise the Trustee, the
Transferors, the Common Depositary, and each Foreign Clearing Agency in writing
forthwith. Without unnecessary delay, but prior to the Euro-Certificate Exchange
Date, the Transferors will execute and deliver to the Trustee at its office or
designated agent outside the United States definitive Bearer Certificates in an
aggregate principal amount equal to the Initial Invested Amount. All Bearer
Certificates so issued and delivered will have Coupons attached. The Global
Certificate may be exchanged for an equal aggregate principal amount of
Definitive Euro-Certificates only on or after the Euro-Certificate Exchange
Date. Notwithstanding the preceding sentence, a United States institutional
investor may at any time exchange the portion of the Global Certificate
beneficially owned by it for an equal aggregate principal amount of Registered
Certificates bearing the applicable legend set forth in the related Supplement
and having, a minimum denomination of $500,000, which may be in temporary form
if the Transferors so elect. A United States institutional investor will be
required to deliver to the Transferors, the Trustee and the Manager at the time
of its purchase of Registered Certificates a signed certificate substantially in
the form attached to the Supplement for the related Series. Upon any demand for
exchange for Definitive Certificates in accordance with this paragraph, the
Transferors shall cause the Trustee to authenticate and deliver the Definitive
Certificates to the Holder (x) outside the United States, in the case of Bearer
Certificates, and (y) according to the instructions of the Holder, in the case
of Registered Certificates, but only upon presentation to the Trustee of a
written statement, substantially in the form attached to the Supplement for the
related Series with respect to the Global Certificate or portion thereof being
exchanged, signed by a Foreign Clearing Agency, to the effect that it has
received in writing or by tested telex a certification substantially in the form
of (i) in the case of beneficial ownership of the Global Certificate or a
portion thereof being exchanged by a United States institutional investor
pursuant to the second preceding sentence, the certificate attached to the
Supplement for the related Series signed by the Manager (which sold the relevant
Certificates) or (ii) in all other cases, the alternative certificate attached
to the Supplement for the related Series, the alternative certificate referred
to in this clause (ii) being dated no earlier than 15 days prior to the
Euro-Certificate Exchange Date and signed by or on behalf of the person
appearing in the records of a Foreign Clearing Agency as the beneficial owner of
the Global Certificate or portion thereof being exchanged. Upon receipt of such
certification, the Trustee shall cause the Global Certificate to be endorsed in
accordance with paragraph (d) below. Unless otherwise provided in the applicable
Supplement, any exchange as provided in this subsection 6.10(b) shall be made
free of charge to the holders and the beneficial owners of the Global
Certificate and to the beneficial owners of the Definitive Euro-Certificates
issued in exchange, except that a person receiving Definitive Euro-Certificates
must bear the cost of insurance, postage, transportation and the like in the
event that such person does not receive such Definitive Euro-Certificates in
person at the offices of a Foreign Clearing Agency.
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(c) The delivery to the Trustee by a Foreign Clearing Agency
of any written statement referred to above may be relied upon by the Transferor
and the Trustee as conclusive evidence that a corresponding certification or
certifications has or have been delivered to such Foreign Clearing Agency,
pursuant to the terms of this Agreement.
(d) Upon any such exchange of all or a portion of the Global
Certificate for a Definitive Euro-Certificate or Certificates, such Global
Certificate shall be indorsed by or on behalf of the Trustee to reflect the
reduction of its principal amount by an amount equal to the aggregate principal
amount of such Definitive Euro-Certificate or Certificates. Until so exchanged
in full, such Global Certificate shall in all respects be entitled to the same
benefits under this Agreement as Definitive Euro-Certificates authenticated and
delivered hereunder except that the beneficial owners of such Global Certificate
shall not be entitled to receive payments of interest on the Certificates until
they have exchanged their beneficial interests in such Global Certificate for
Definitive Euro-Certificates.
Section 6.11 Book-Entry Certificates. Unless otherwise provided in any
related Supplement, the Investor Certificates, upon original issuance, will be
issued in the form of the requisite number of typewritten Certificates
representing the Book-Entry Certificates, to be delivered to The Depository
Trust Company, the initial Clearing Agency, by, or on behalf of the Transferors.
The Investor Certificates shall initially be registered on the Certificate
Register in the name of CEDE & Co., the nominee of the Clearing Agency, and no
Certificate owner will receive a definitive certificate representing such
Certificate owner's interest in the Investor Certificates, except as provided in
Section 6.13 of the Agreement. Unless and until definitive, fully registered
Investor Certificates (the "Definitive Certificates") have been issued to
Certificate Owners pursuant to Section 6.13 of the Agreement:
(i) the provision of this Section 6.11 shall be in full force
and effect;
(ii) the Transferor, the Servicer, the Paying Agent, the
Transfer Agent and Registrar and the Trustee may deal with the Clearing
Agency and the Clearing Agency Participants for all purposes (including
the making of distributions on the Investor Certificates) as the
authorized representatives of the Certificate Owners;
(iii) to the extent that the provisions of this Section 6.11
conflict with any other provisions of this Agreement, the provisions of
this Section 6.11 shall control;
(iv) the rights of Certificate Owners shall be exercised only
through the Clearing Agency and the Clearing Agency Participants and
shall be limited to those established by law and agreements between
such Certificate Owners and the Clearing Agency and/or the Clearing
Agency Participants. Pursuant to the Depository Agreement, unless and
until Definitive Certificates are issued pursuant to Section 6.13 of
the Agreement, the initial Clearing Agency will make book-entry
transfers among the Clearing Agency Participants and receive and
transmit distributions of principal and interest on the Investor
Certificates to such Clearing Agency Participants; and
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(v) whenever this Agreement requires or permits actions to be
taken based upon instructions or directions of a specified percentage
of the Invested Amount of any or all Series of Certificates
outstanding, the Clearing Agency shall be deemed to represent such
percentage only to the extent that it has received instructions to such
effect from Certificate Owners and/or Clearing Agency Participants
owning or representing, respectively, such required percentage of the
beneficial interest in Investor Certificates.
Section 6.12 Notices to Clearing Agency. Whenever notice or other
communication to the Investor Certificateholders is required under this
Agreement, unless and until Definitive Certificates shall have been issued to
Certificate Owners pursuant to Section 6.13 of the Agreement, the Trustee, the
Servicer and the Paying Agent shall give all such notices and communications
specified herein to be given to Holders of the Investor Certificates to the
Clearing Agencies.
Section 6.13 Definitive Certificates. If Book-Entry Certificates have
been issued pursuant to Section 6.11 and if (i)(A) the Transferors advise the
Trustee in writing that the Clearing Agency is no longer willing or able to
discharge properly its responsibilities under the Depository Agreement, and (B)
the Trustee or the Transferors are unable to locate a qualified successor, (ii)
the Transferors at their option, advise the Trustee in writing that they elects
to terminate the book-entry system through the Clearing Agency with respect to
the Certificates or (iii) after the occurrence of a Servicer Default,
Certificate Owners representing beneficial interests aggregating more than 50%
of the Invested Amount, of any Series advise the Trustee and the Clearing Agency
through the Clearing Agency Participants in writing that the continuation of a
book-entry system through the Clearing Agency is no longer in the best interests
of the Certificate Owners, the Trustee shall notify all Certificate Owners,
through each applicable Clearing Agency, of the occurrence of any such event and
of the availability of Definitive Certificates to Certificate Owners requesting
the same. Upon surrender to the Trustee of the Investor Certificates by the
Clearing Agency, accompanied by registration instructions from the Clearing
Agency for registration the Trustee shall issue the Definitive Certificates.
Neither the Transferors, the Transfer Agent and Registrar nor the Trustee shall
be liable for any delay in delivery of such instructions and may conclusively
rely on, and shall be protected in relying on, such instructions. Upon the
issuance of Definitive Certificates all references herein to obligations imposed
upon or to be performed by the Clearing Agency shall be deemed to be imposed
upon and performed by the Trustee to the extent applicable with respect to such
Definitive Certificates and the Trustee shall recognize the Holders of the
Definitive Certificates as Certificateholders hereunder.
Section 6.14 Meetings of Certificateholders.
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(a) Unless not permitted by the Supplement for any Series
issued in whole or in part in Bearer Certificates, the Transferors, the Servicer
or the Trustee may at any time call a meeting of the Certificateholders of such
Series or of all Series, to be held at such time and at such place as the
Transferors, the Servicer or the Trustee, as the case may be, shall determine,
for the purpose of approving a modification of or amendment to, or obtaining a
waiver of, any covenant or condition set forth in this Agreement with respect to
such Series or in the Certificates of such Series, subject to Section 13.01 of
the Agreement. References in this Section to Certificateholders shall be deemed
to refer to the Exchangeable Transferor Certificates and only those Series of
Investor Certificates for which this Section 6.14 is applicable. Notice of any
meeting of Certificateholders, setting forth the time and place of such meeting
and in general terms the action proposed to be taken at such meeting, shall be
given in accordance with Section 13.05 of the Agreement and at least once in an
Authorized Newspaper and, if and for so long as the Certificates are listed on
the Luxembourg Stock Exchange or other stock exchange and such exchange so
requires, in a newspaper of general circulation in Luxembourg (which newspaper
shall be printed in the English or French language and customarily published on
each business day in Luxembourg) or the location required by such other stock
exchange, the first publication to be not less that 20 nor more than 180 days
prior to the date fixed for the meeting. To be entitled to vote at any meeting
of Certificateholders, a person shall be (i) a Holder of one or more
Certificates of the applicable Series or (ii) a person appointed by an
instrument in writing as proxy by the Holder of one or more Certificates. The
only Persons who shall be entitled to be present or to speak to any meeting of
Certificateholders shall be the Persons entitled to vote at such meeting and
their counsel and any representatives of the Transferors, the Servicer and the
Trustee and their respective counsels.
(b) At a meeting of Investor Certificateholders, persons
entitled to vote Investor Certificates evidencing Undivided Interests
aggregating a majority of the Invested Amount of the applicable Series or all
outstanding Series, as the case may be, shall constitute a quorum. No business
shall be transacted in the absence of a quorum, unless a quorum is present when
the meeting is called to order. In the absence of a quorum at any such meeting,
the meeting may be adjourned for a period of not less than 10 days; in the
absence of a quorum at any such adjourned meeting, such adjourned meeting may be
further adjourned for a period of not less than 10 days; at the reconvening of
any meeting further adjourned for lack of a quorum, the Persons entitled to vote
at least 25% in Undivided Interest of the applicable Series or all outstanding
Series, as the case may be, shall constitute a quorum for the taking of any
action set forth in the notice of the original meeting. Notice of the
reconvening of any adjourned meeting shall be given as provided above except
that such notice must be given not less than five days prior to the date on
which the meeting is scheduled to be reconvened. Notice of the reconvening of an
adjourned meeting shall state expressly the percentage of the aggregate
principal amount of the outstanding Investor Certificates which shall constitute
a quorum.
(c) Any Certificateholder who has executed an instrument in
writing appointing a person as proxy shall be deemed to be present for the
purposes of determining a quorum and be deemed to have voted; provided that such
Certificateholder shall be considered as present or voting only with respect to
the matters covered by such instrument in writing. Subject to the provisions of
Section 13.01 of the Agreement, any resolution passed or decision taken at any
meeting of Investor Certificateholders duly held in accordance with this Section
6.14 shall be binding on all the Investor Certificateholders whether or not
present or represented at the meeting.
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The holding of Bearer Certificates shall be proved by the production of such
Bearer Certificates or by a certificate, satisfactory to the Servicer and the
Trustee, executed by any bank, trust company or recognized securities dealer,
wherever situated, satisfactory to the Servicer and the Trustee. Each such
certificate shall be dated and shall state that on the date thereof a Bearer
Certificate bearing a specified serial number was deposited with or exhibited to
such bank, trust company or recognized securities dealer by the person named in
such certificate. Any such certificate may be issued in respect of one or more
Bearer Certificates specified therein. The holding by the person named in any
such certificate of any Bearer Certificate specified therein shall be presumed
to continue for a period of one year from the date of such certificate unless at
the time of any determination of such holding (i) another certificate bearing a
later date issued in respect of the same Bearer Certificate shall be produced,
(ii) the Bearer Certificate specified in such certificate shall be produced by
some other person or (iii) the Bearer Certificate specified in such certificate
shall have ceased to be outstanding. The appointment of any proxy shall be
proved by having the signature of the person executing the proxy guaranteed by
any bank, trust company or recognized securities dealer satisfactory to the
Trustee. The holding of Registered Certificates shall be proved by the
Certificate Register or by a certificate or certificates of the Transfer Agent
and Registrar.
The Trustee shall appoint a temporary chairman of the meeting. A permanent
chairman and a permanent secretary of the meeting shall be elected by vote of
the holders of a majority in Undivided Interest of the Certificates of such
Series represented at the meeting. No vote shall be cast or counted at any
meeting in respect of any Certificate challenged as not outstanding and ruled by
the chairman of the meeting to be not outstanding, The chairman of the meeting
shall have no right to vote except as a Certificateholder or proxy. Any meeting
of Certificateholders duly called at which a quorum is present may be adjourned
from time to time, and the meeting may be held as so adjourned without further
notice.
(d) The vote upon any resolution submitted to any meeting of
Certificateholders shall be by written ballot on which shall be subscribed the
signatures of the Certificateholders or proxies and on which shall be inscribed
the serial number or numbers of the Certificates held or represented by them.
The permanent chairman of the meeting shall appoint two inspectors of votes who
shall count all votes cast at the meeting for or against any resolution and who
shall make and file with the secretary of the meeting their verified written
reports in duplicate of all votes cast at the meeting. A record in duplicate of
the proceedings of each meeting of Certificateholders shall be prepared by the
secretary of the meeting and there shall be attached to said record the original
reports of the inspectors of votes on any vote by ballot taken thereat and
affidavits by one or more persons having knowledge of the facts setting forth a
copy of the notice of the meeting and showing that said notice was published as
provided above. The record shall be signed and verified by the permanent
chairman and secretary of the meeting and duplicates shall be delivered to the
Servicer and the Trustee to be preserved by the Trustee, the latter to have
attached thereto the ballots voted at the meeting. Any record so signed and
verified shall be conclusive evidence of the matters therein stated.
[END OF ARTICLE VI]
64
ARTICLE VII
OTHER MATTERS RELATING TO THE TRANSFERORS
Section 7.01 Liability of the Transferors. Each Transferor shall be
liable in accordance herewith only to the extent of the obligations specifically
undertaken by such Transferor.
Section 7.02 Merger or Consolidation of, or Assumption of the
Obligations of, a Transferor. No Transferor shall consolidate with or merge into
any other corporation or convey or transfer its properties and assets
substantially as an entirety to any Person, unless:
(i) the corporation formed by such consolidation or into which
such Transferor is merged or the Person which acquires by conveyance or
transfer the properties and assets of such Transferor substantially as
an entirety shall be organized and existing under the laws of the
United States of America or any State or the District of Columbia, and
if such Transferor is not the surviving entity, shall expressly assume,
by an agreement supplemental hereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, the performance of every
covenant and obligation of such Transferor, as applicable hereunder and
shall benefit from all the rights granted to such Transferor, as
applicable hereunder. (To the extent that any right, covenant or
obligation of such Transferor, is inapplicable to the successor entity,
such successor entity shall be subject to such covenant or obligation,
or benefit from such right, as would apply, to the extent practicable,
to such successor entity.);
(ii) such Transferor has delivered to the Trustee an Officer's
Certificate signed by a Vice President of such Transferor and an
Opinion of Counsel each stating that such consolidation, merger,
conveyance or transfer and such supplemental agreement comply with this
Section 7.02 and that all conditions precedent herein provided for
relating to such transaction have been complied with; and
(iii) the Rating Agencies have advised the Transferors and the
Trustee that the rating of the Certificates, after giving effect to
such assignment and succession, will not be lowered or withdrawn.
(b) The obligations of each Transferor hereunder shall not be
assignable nor shall any Person succeed to the obligations of a Transferor
hereunder except in each case in accordance with the provisions of the foregoing
paragraph.
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Section 7.03 Limitation on Liability of the Transferors. The directors,
officers, employees or agents of the Transferors shall not be under any
liability to the Trust, the Trustee, the Certificateholders or any other Person
hereunder or pursuant to any document delivered hereunder, it being expressly
understood that all such liability is expressly waived and released as a
condition of, and as consideration for, the execution of this Agreement and any
Supplement and the issuance of the Certificates; provided, however, that this
provision shall not protect the officers, directors, employees or agents of the
Transferors against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or gross negligence in the performance of duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder. Except as provided in Section 7.04, none of the Transferors will be
under any liability to the Trust, the Trustee, the Certificateholders or any
other Person for any action taken or for refraining from the taking of any
action in its capacity as a Transferor pursuant to this Agreement or any
Supplement whether arising from express or implied duties under this Agreement
or any Supplement; provided, however, that this provision shall not protect a
Transferor against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or gross negligence in the performance of duties
hereunder or by reason of reckless disregard of obligations and duties
hereunder. Each Transferor may rely in good faith on any document of any kind
prima facie properly executed and submitted by any Person respecting any matters
arising hereunder.
Section 7.04 Liabilities. Notwithstanding Section 7.03, by entering
into this Agreement, each of RFC, Centurion Bank and FSB, jointly and severally,
agrees to be liable, directly to the injured party, for the entire amount of any
losses, claims, damages or liabilities (other than those incurred by a
Certificateholder in the capacity of an investor in the Investor Certificates)
arising out of or based on the arrangement created by this Agreement and the
actions of the Servicer taken pursuant hereto as though this Agreement created a
partnership under the Uniform Partnership Act. Each of RFC, Centurion Bank and
FSB, jointly and severally, agrees to pay, indemnify and hold harmless each
Investor Certificateholder against and from any and all such losses, claims,
damages and liabilities except to the extent that they arise from any action by
such Investor Certificateholder. Subject to Sections 8.03 and 8.04, in the event
of a Service Transfer, the Successor Servicer will indemnify and hold harmless
RFC, Centurion Bank and FSB for any losses, claims, damage and liabilities of
RFC, Centurion Bank or FSB, as applicable, as described in this Section 7.04
arising from the actions or omissions of such Successor Servicer. The amount of
each Transferor's liability under this Section 7.04 shall be subordinate to the
security interest of the Trust in the Receivables and shall be payable from the
assets of such Transferor at the time such liability is asserted and at any time
thereafter.
[END OF ARTICLE VII]
66
ARTICLE VIII
OTHER MATTERS RELATING TO THE SERVICER
Section 8.01 Liability of the Servicer. The Servicer shall be liable in
accordance herewith only to the extent of the obligations specifically
undertaken by the Servicer in such capacity herein.
Section 8.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer. The Servicer shall not consolidate with or merge
into any other corporation or convey or transfer its properties and assets
substantially as an entirety to any Person, unless:
(i) the corporation formed by such consolidation or into which
the Servicer is merged or the Person which acquires by conveyance or
transfer the properties and assets of the Servicer substantially as an
entirety shall be a corporation organized and existing under the laws
of the United States of America or any State or the District of
Columbia, and if the Servicer is not the surviving entity, shall
expressly assume, by an agreement supplemental hereto, executed and
delivered to the Trustee, the performance of every covenant and
obligation of the Servicer hereunder. (To the extent that any right,
covenant or obligation of the Transferor, is inapplicable to the
successor entity, such successor entity shall be subject to such
covenant or obligation, or benefit from such right, as would apply, to
the extent practicable, to such successor entity.); and
(ii) the Servicer has delivered to the Trustee an officer's
Certificate and an Opinion of Counsel each stating that such
consolidation, merger, conveyance or transfer and such supplemental
agreement comply with this Section 8.02 and that all conditions
precedent herein provided for relating to such transaction have been
complied with. The Servicer shall promptly advise the Rating Agencies
in writing of any such merger, consolidation, conveyance or transfer.
Section 8.03 Limitation on Liability of the Servicer and Others. The
directors, officers, employees or agents of the Servicer shall not be under any
liability to the Trust, the Transferors, the Trustee, the Certificateholders, or
any other Person hereunder or pursuant to any document delivered hereunder, it
being expressly understood that all such liability is expressly waived and
released as a condition of, and as consideration for, the execution of this
Agreement and any Supplement and the issuance of the Certificates; provided,
however, that this provision shall not protect the directors, officers,
employees and agents of the Servicer against any liability which would otherwise
be imposed by reason of willful misfeasance, bad faith or gross negligence in
the performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder. Except as provided in Section 8.04, the
Servicer shall not be under any liability to the Trust, the Trustee, the
Certificateholders or any other Person for any action taken or for refraining
from the taking of any action in its capacity as Servicer pursuant to this
Agreement or any Supplement whether arising from express or implied duties under
this Agreement or any Supplement; provided, however, that this provision shall
not protect the Servicer against any liability which would otherwise be imposed
by reason of willful misfeasance, bad faith or gross negligence in the
performance of duties hereunder or by reason of reckless disregard of
obligations and duties hereunder. The Servicer may rely in good faith on any
document of any kind prima facie properly executed and submitted by any Person
respecting any matters arising hereunder. The Servicer shall not be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties to service the Receivables in accordance with this
Agreement or any Supplement which in its reasonable opinion may involve it in
any expense or liability.
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Section 8.04 Indemnification of the Trust and the Trustee. The Servicer
shall indemnify and hold harmless the Trust, for the benefit of the
Certificateholders, and the Trustee, including its officers, directors and
employees from and against any loss, liability, expense, damage or injury
arising out of or relating to any claims, actions or proceedings brought or
asserted by third parties which are suffered or sustained by reason of any acts
or omissions of the Servicer pursuant to this Agreement or any Supplement,
including but not limited to any judgment, award, settlement, reasonable
attorneys' fees and other costs or expenses incurred in connection with the
defense of any actual or threatened action, proceeding or claim; provided,
however, that the Servicer shall not indemnify the Trust, the Trustee or its
officers, directors or employees or the Investor Certificateholders for any
liability, cost or expense of the Trust or the Trustee or its officers,
directors or employees if any such claims, actions or proceedings relate to any
action taken by the Trustee at the request of the Investor Certificateholders or
any Federal, state or local income or franchise taxes (or any interest or
penalties with respect thereto) required to be paid by the Trustee or the
Investor Certificateholders in connection herewith to any taxing authority.
Subject to Sections 7.01 and 7.04 and subsection 10.02(b) of the Agreement, any
indemnification pursuant to this Section shall only be from the assets of the
Servicer. The provisions of this indemnity shall run directly to and be
enforceable by an injured party subject to the limitations hereof and shall
survive the termination of the Agreement and payment in full of the
certificates.
Section 8.05 The Servicer Not to Resign. The Servicer shall not resign
from the obligations and duties hereby imposed on it as such except (a) upon
determination that (i) the performance of its duties hereunder is or will become
impermissible under applicable law, regulation or order and (ii) there is no
reasonable action which the Servicer could take to make the performance of its
duties hereunder permissible under applicable law, or (b) upon the satisfaction
of the following conditions, (i) the assumption, by an agreement supplemental
hereto, executed by and delivered to the Trustee, of the obligations and duties
of the Servicer hereunder by the proposed successor Servicer, (ii) the written
confirmation by the Rating Agencies that the then rating of any Series of
Certificates then outstanding will not, solely as a result of such transfer, be
reduced or withdrawn, (iii) the delivery to the Trustee of an Opinion of Counsel
substantially to the effect that (A) such transfer will not adversely affect the
treatment of any Series of Certificates then outstanding after such transfer as
debt for Federal and state income tax purposes, and (B) such transfer will not
have any material adverse impact on the federal or state income taxation of the
Trust or an Investor Certificateholder or any Certificate Owner, and (iv) the
proposed successor Servicer has a net worth of not less than $50,000,000 and its
regular business includes the servicing of charge card or revolving credit
receivables. Any determination pursuant to clause (a) of this Section permitting
the resignation of the Servicer shall be evidenced as to clause (a)(i) of this
Section by an Opinion of Counsel to such effect delivered to the Trustee.
Notwithstanding anything in this Agreement or any Supplement to the contrary,
any Successor Servicer appointed under clause (b) of this Section shall be
deemed to be a Successor Servicer as defined hereunder. No such resignation
shall become effective until the Trustee or its duly appointed agent (which may
not be the outgoing Servicer) or a Successor Servicer shall have assumed the
responsibilities and obligations of the Servicer in accordance with Section
10.02 hereof. If the Trustee is unable within 120 days of the date of such
determination to appoint a Successor Servicer pursuant to subsection 10.02(a),
the Trustee or its duly appointed agent (which may not be the outgoing Servicer)
shall serve as Successor Servicer hereunder but the Trustee shall have continued
authority to appoint another Person as Successor Servicer.
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Section 8.06 Access to Certain Documentation and Information Regarding
the Receivables. The Servicer shall provide to the Trustee access to the
documentation regarding the Accounts and the Receivables in such cases where the
Trustee is required in connection with the enforcement of the rights of the
Investor Certificateholders, or by applicable statutes or regulations, to review
such documentation such access being afforded without charge but only (i) upon
reasonable request, (ii) during normal business hours, (iii) subject to such
security and confidentiality procedures as the Servicer may deem reasonably
necessary and (iv) at offices designated by the Servicer. Nothing in this
Section 8.06 shall derogate from the obligation of the Transferors, the Trustee
or the Servicer to observe any applicable law prohibiting disclosure of
information regarding the Obligors and the failure of the Servicer to provide
access as provided in this Section 8.06 as a result of such obligation shall not
constitute a breach of this Section 8.06.
Section 8.07 Delegation of Duties. It is understood and agreed by the
parties hereto that the Servicer may delegate its duties hereunder to any Person
who agrees to conduct such duties in accordance with the applicable Account
Guidelines. The fees of any Person to whom such duties are delegated are, and
shall continue to be, for the account of the Servicer. Any such delegations do
not and shall not relieve the Servicer of its liability and responsibility with
respect to such duties, and do not and shall not constitute a resignation within
the meaning of Section 8.05 hereof. If any such additional delegation is to a
Person other than FDC or a subsidiary of FDC or American Express Company or
otherwise is not in the ordinary course of business, notification thereof shall
be given to each Rating Agency.
Section 8.08 Examination of Records. The Transferors and the Servicer
shall clearly and unambiguously identify each Account (including any Additional
Account designated pursuant to Section 2.06) in its computer or other records to
reflect that the Receivables arising in such Account have been conveyed to the
Trust pursuant to this Agreement. The Transferors and the Servicer shall, prior
to the sale or transfer to a third party of any receivable held in its custody,
examine its computer and other records to determine that such receivable is not
a Receivable.
[END OF ARTICLE VIII]
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ARTICLE IX
PAY OUT EVENTS
Section 9.01 Pay Out Events. Unless modified with respect to any Series
of Investor Certificates by any related Supplement, if any one of the following
events shall occur:
(a) any of RFC, Centurion Bank, FSB or TRS shall 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 it 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 any of RFC,
Centurion Bank, FSB or TRS and such decree or order shall have remained in force
undischarged or unstayed for a period of 60 days; or any of RFC, Centurion Bank,
FSB or TRS shall admit in writing its inability to pay its debts generally as
they become due, file a petition to take advantage of any applicable insolvency
or reorganization statute, make an assignment for the benefit of its creditors
or voluntarily suspend payment of its obligations; or any Transferor shall
become unable for any reason to transfer Receivables to the Trust in accordance
with the provisions of this Agreement;
(b) the Trust shall become an "investment company" within the
meaning of the Investment Company Act of 1940, as amended;
(c) after any applicable grace period, a failure by the
Transferors to convey the Receivables in Additional Accounts to the Trust when
required; and
(d) on any Determination Date, the Transferor Amount as of the
last day of the prior Due Period was less than 3.0% of the Trust Principal
Component as of the last day of the prior Due Period;
then, a Pay Out Event with respect to all Series of
Certificates then outstanding shall occur without any notice or other action on
the part of the Trustee or all Investor Certificateholders immediately upon the
occurrence of such event. The Trustee shall advise the Rating Agencies in
writing of the occurrence of any Pay Out Event.
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Section 9.02 Additional Rights Upon the Occurrence of Certain Events.
(a) If any of RFC, Centurion Bank, FSB or TRS voluntarily goes
into liquidation or consents 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 any of RFC, Centurion Bank,
FSB or TRS or of or relating to all or substantially all their respective
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 any of RFC,
Centurion Bank, FSB or TRS; or any of RFC, Centurion Bank, FSB or TRS shall
admit in writing its inability to pay its debts generally as they become due,
file a petition to take advantage of any applicable insolvency or reorganization
statute, make an assignment for the benefit of its creditors or voluntarily
suspend payment of its obligations; or any Transferor shall become unable for
any reason to transfer Receivables to the Trust in accordance with the
provisions of this Agreement (such voluntary liquidation, appointment entering
of such decree, admission, filing, making, suspension or inability, a
"Dissolution Event"), the Transferors or TRS shall promptly give notice of such
event to the Trustee, and TRS shall on the day of such appointment, voluntary
liquidation, entering of such decree, admission, filing, making, suspension or
inability, as the case may be (the "Appointment Day"), immediately cease to sell
Receivables to RFC under the Receivable Purchase Agreement and the Transferors
will immediately cease to transfer Receivables to the Trust hereunder. So long
as any Series issued prior to April 16, 2004 remains outstanding, within 15 days
of the receipt by the Trustee of the notice of a Dissolution Event, the Trustee
shall (i) publish a notice in an Authorized Newspaper that a Dissolution Event
has occurred and that the Trustee intends to sell, dispose of or otherwise
liquidate the Receivables and (ii) send written notice to the Investor
Certificateholders describing the provisions of this Section 9.02 and requesting
instructions from such Holders, which notice shall request each Investor
Certificateholder to advise the Trustee in writing that it elects one of the
following options: (A) the Investor Certificateholder wishes the Trustee to
instruct the Servicer not to sell, dispose of or otherwise liquidate the
Receivables, or (B) the Investor Certificateholder wishes the Trustee to
instruct the Servicer to sell, dispose of or otherwise liquidate the Receivables
and to instruct the Servicer to reconstitute the Trust upon the same terms and
conditions set forth herein, or (C) the Investor Certificateholder refuses to
advise the Trustee as to the specific action the Trustee shall instruct the
Servicer to take. If after 90 days from the day notice pursuant to clause (i)
above is first published (the "Publication Date"), the Trustee shall not have
received written instructions of Holders of Investor Certificates representing
Undivided Interests aggregating in excess of 50% of the related Invested Amount
of each Series (or in the case of a series having more than one class of
investor certificates, each class of such series) to the effect that the Trustee
shall not instruct the Servicer to sell, dispose of, or otherwise liquidate the
Receivables and to instruct the Servicer to reconstitute the Trust upon the same
terms and conditions as set forth herein, the Trustee shall instruct the
Servicer to proceed to use its best efforts to sell, dispose of, or otherwise
liquidate the Receivables, which efforts shall include the solicitation of
competitive bids and the Servicer shall proceed to use its best efforts to
consummate the sale, liquidation or disposition of the Receivables as provided
above on terms equivalent to the best purchase offer for the Receivables. If,
however, with respect to the portion of the Receivables allocable to any
outstanding Series, the holders of more than 50% of the principal amount of each
class of such Series instruct the Trustee not to sell the portion of the
Receivables allocable to such Series, the Trust shall continue with respect to
such Series pursuant to the terms of the Agreement and the Supplement. The
portion of the Receivables allocable to any Series shall be determined in the
same manner as such determination would be made pursuant to Section 12.02(c).
The Transferors or any of their respective Affiliates shall be permitted to bid
for the Receivables. In addition the Transferors or any of their respective
Affiliates shall have the right to match any bid by a third person and be
granted the right to purchase the Receivables at such matched bid price. The
Trustee may obtain a prior determination from the conservator or receiver that
the terms and manner of any proposed, sale, disposition or liquidation are
commercially reasonable. The provisions of Sections 9.01 and 9.02 shall not be
deemed to be mutually exclusive.
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(b) The proceeds from the sale, disposition or liquidation of
the Receivables pursuant to subsection (a) above shall be treated as Collections
on the Receivables and shall be allocated and deposited in accordance with the
provisions of Article IV; provided that the Trustee shall determine conclusively
without liability for such determination the amount of such proceeds which are
allocable to Yield Collections and the amount of such proceeds which are
allocable to Principal Collections. On the day following the Distribution Date
on which such proceeds are distributed to the Investor Certificateholders, the
Trust shall terminate.
[END OF ARTICLE IX]
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ARTICLE X
SERVICER DEFAULTS
Section 10.01 Servicer Defaults. If any one of the following events (a
"Servicer Default") shall occur and be continuing:
(a) any failure by the Servicer to make any payment, transfer
or deposit or to give instructions or notice to the Trustee to make such
payment, transfer or deposit or to give notice to the Trustee as to any required
drawing or payment under any Enhancement on or before the date occurring five
Business Days after the date such payment, transfer, deposit or drawing or such
instruction or notice is required to be made or given, as the case may be, under
the terms of this Agreement or any Supplement; provided, however, that any such
failure caused by a nonwillful act of the Servicer shall not constitute a
Servicer Default if the Servicer promptly remedies such failure within five
Business Days after receiving notice of such failure or otherwise becoming aware
of such failure;
(b) failure on the part of the Servicer duly to observe or
perform any other covenants or agreements of the Servicer set forth in this
Agreement or any Supplement, which has a material adverse effect on the
Certificateholders of any Series then outstanding and which continues unremedied
for a period of 60 days after the date on which the written notice of such
failure requiring the same to be remedied shall have been given to the Servicer
and which continues to materially adversely affect the rights of the Holders of
Investor Certificates of any Series; the Servicer shall delegate its duties
under this Agreement, except as permitted by Section 8.07;
(c) any representation, warranty or certification made by the
Servicer in this Agreement or any Supplement or in any certificate delivered
pursuant to this Agreement or any Supplement shall prove to have been incorrect
when made, which has a material adverse effect on the rights of the
Certificateholders of any Series then outstanding and which continues to be
incorrect in any material respect and which continues to affect materially and
adversely the rights of the Certificateholders of any Series 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 Servicer by the Trustee, or to the
Servicer and the Trustee by the Holders of Investor Certificates evidencing
Undivided Interests aggregating more than 50% of the Invested Amount of any
Series adversely affected thereby; or
(d) the Servicer shall 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
the Servicer 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 the Servicer and such decree or order
shall have remained in force undischarged or unstayed for a period of 60 days;
or the Servicer shall admit in writing its inability to pay its debts generally
as they become due, file a petition to take advantage of any applicable
insolvency or reorganization statute, make any assignment for the benefit of its
creditors or voluntarily suspend payment of its obligations;
73
then, so long as such Servicer Default shall not have been remedied, either the
Trustee or the Holders of Investor Certificates evidencing Undivided Interests
aggregating more than 50% of the Aggregate Invested Amount, by notice then given
in writing to the Servicer (and to the Trustee if given by the Investor
Certificateholders) (a "Termination Notice"), may terminate all of the rights
and obligations of the Servicer as Servicer under this Agreement and in and to
the Receivables and the proceeds thereof and appoint a new Servicer (a "Service
Transfer"). The rights and interests of the Transferor Interest will not be
affected by any Service Transfer. The Trustee, upon giving or receiving a
Termination Notice shall immediately notify the Rating Agencies and any
Enhancement Provider of such notice. After receipt by the Servicer of such
Termination Notice, and on the date that a Successor Servicer shall have been
appointed by the Trustee pursuant to Section 10.02, all authority and power of
the Servicer under this Agreement shall pass to and be vested in a Successor
Servicer; and, without limitation, the Trustee is hereby authorized and
empowered (upon the failure of the Servicer to cooperate) to execute and
deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, all
documents and other instruments upon the failure of the Servicer to execute or
deliver such documents or instruments, and to do and accomplish all other acts
or things necessary or appropriate to effect the purposes of such Service
Transfer. The Servicer agrees to cooperate with the Trustee and such Successor
Servicer in effecting the termination of the responsibilities and rights of the
Servicer to conduct servicing hereunder, including, without limitation, the
transfer to such Successor Servicer of all authority of the Servicer to service
the Receivables provided for under this Agreement, including, without
limitation, all authority over all Collections which shall on the date of
transfer be held by the Servicer for deposit, or which have been deposited by
the Servicer, in the Collection Account, or which shall thereafter be received
with respect to the Receivables, and in assisting the Successor Servicer and in
enforcing all rights to Recoveries. The Servicer shall promptly transfer its
electronic records relating to the Receivables to the Successor Servicer in such
electronic form as the Successor Servicer may reasonably request and shall
promptly transfer to the Successor Servicer all other records, correspondence
and documents necessary for the continued servicing of the Receivables in the
manner and at such times as the Successor Servicer shall reasonably request. To
the extent that compliance with this Section 10.01 shall require the Servicer to
disclose to the Successor Servicer information of any kind which the Servicer
reasonably deems to be confidential, the Successor Servicer shall be required to
enter into such customary licensing and confidentiality agreements as the
Servicer shall deem necessary to protect its interest.
Notwithstanding the foregoing, a delay in or failure of
performance referred to in subsection 10.01(a) for a period of 10 Business Days
after the applicable grace period or under subsection 10.01(b) or (c) for a
period of 60 Business Days after the applicable grace period, shall not
constitute a Servicer Default if such delay or failure could not be prevented by
the exercise of reasonable diligence by the Servicer and such delay or failure
was caused by an act of God or the public enemy, acts of declared or undeclared
war, public disorder, rebellion, riot or sabotage, epidemics, landslides,
lightning, fire, hurricanes, tornadoes, earthquakes, nuclear disasters or
meltdowns, floods, power outages or similar causes. The preceding sentence shall
not relieve the Servicer from using its best efforts to perform its obligations
in a timely manner in accordance with the terms of this Agreement and the
Servicer shall provide the Trustee, any Enhancement Provider, the Transferors
and the Holders of Investor Certificates with an Officer's Certificate giving
prompt notice of such failure or delay by it, together with a description of the
cause of such failure or delay and its efforts so to perform its obligations.
The Servicer shall immediately notify the Trustee in writing of any Servicer
Default.
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Section 10.02 Trustee to Act; Appointment of Successor.
(a) On and after the receipt by the Servicer of a Termination
Notice pursuant to Section 10.01, the Servicer shall continue to perform all
servicing functions under this Agreement until the date specified in the
Termination Notice or otherwise specified by the Trustee in writing or, if no
such date is specified in such Termination Notice, or otherwise specified by the
Trustee, until a date mutually agreed upon by the Servicer and Trustee (not to
exceed 90 days from the date of delivery of such notice). The Trustee shall as
promptly as possible after the giving of a Termination Notice appoint a
successor servicer (the "Successor Servicer"), with the consent of any
Enhancement Provider, and such Successor Servicer shall accept its appointment
by a written assumption in a form acceptable to the Trustee, the Transferors and
any Enhancement Provider. The Transferors shall have the right to nominate to
the Trustee the name of a potential successor servicer which nominee shall be
selected by the Trustee as the Successor Servicer, subject to the consent of any
Enhancement Provider. The Trustee may obtain bids from any potential successor
servicer. If the Trustee is unable to obtain any bids from any potential
successor servicer and the Servicer delivers an Officer's Certificate to the
effect that it cannot in good faith cure the Servicer Default which gave rise to
a transfer of servicing, then the Trustee shall offer the Transferors the right
to accept reassignment of all the Receivables; provided, however, that no such
reassignment shall occur unless the Transferors shall deliver to the Trustee and
the Rating Agencies an Opinion of Counsel reasonably acceptable to the Trustee
that such reassignment would not constitute a fraudulent conveyance by the
Transferor. The reassignment deposit amount for such a reassignment shall be
equal to the Aggregate Invested Amount (less the aggregate principal amount on
deposit in any principal funding account), plus (i) accrued interest thereon, at
the applicable Certificate Rate (through the end of the Due Period for the
subsequent Distribution Date of reassignment), and (ii) any unpaid amounts
payable to any Enhancement Provider under the applicable Enhancement agreement.
In the event that a Successor Servicer has not been appointed and has not
accepted its appointment at the time when the Servicer ceases to act as
Servicer, the Trustee (as trustee hereunder) without further action shall
automatically be appointed the Successor Servicer. Notwithstanding the above,
the Trustee shall, if it is legally unable so to act, petition a court of
competent jurisdiction to appoint any established financial institution having a
net worth of not less than $50,000,000 and whose regular business includes the
servicing of charge card or revolving credit receivables as the Successor
Servicer hereunder. Notwithstanding anything to the contrary in this Agreement,
the entire amount of the reassignment deposit amount shall be distributed to the
Investor Certificateholders of the related Series on the subsequent Distribution
Date for such Series pursuant to Section 12.03 (except for the applicable
Repayment Amount and other amounts payable to any Enhancement Provider under the
applicable Enhancement agreement, which amounts shall be distributed to such
Enhancement Provider.)
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(b) Upon its appointment., the Successor Servicer shall be the
successor in all respects to the Servicer with respect to servicing functions
under this Agreement and shall be subject to all the responsibilities, duties
and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof, and all references in this Agreement to the Servicer shall be
deemed to refer to the Successor Servicer; provided, however, that, the outgoing
Servicer shall not be relieved of any liability hereunder for its actions prior
to the transfer of servicing hereunder; and provided further, that, (i) the
outgoing Servicer shall not indemnify the Trust or the Trustee under Section
8.04 for acts, omissions or alleged acts or omissions by a Successor Servicer
and (ii) the outgoing Servicer shall not pay or reimburse the Trustee pursuant
to Section 11.05 for any expense, disbursement or advance of the Trustee related
to or arising as a result of the negligence or bad faith of the Successor
Servicer. Any Successor Servicer, by its acceptance of its appointment, will
automatically agree to be bound by the terms and provisions of any applicable
Enhancement agreement.
(c) In connection with such appointment and assumption, the
Trustee shall be entitled to such compensation, or may make such arrangements
for the compensation of the Successor Servicer out of Collections, as it and
such Successor Servicer shall agree; provided, however, that no such
compensation shall be in excess of the Monthly Servicing Fee permitted to the
Servicer pursuant to Section 3.02.
(d) All authority and power granted to the Successor Servicer
under this Agreement shall automatically cease and terminate upon termination of
the Trust pursuant to Section 12.01 and shall pass to and be vested in the
Transferors and, without limitation, the Transferors are hereby authorized and
empowered to execute and deliver, on behalf of the Successor Servicer, as
attorney-in-fact or otherwise, all documents and other instruments, and to do
and accomplish all other acts or things necessary or appropriate to effect the
purposes of such transfer of servicing rights. The Successor Servicer agrees to
cooperate with the Transferors in effecting the termination of the
responsibilities and rights of the Successor Servicer to conduct servicing on
the Receivables. The Successor Servicer shall transfer its electronic records
relating to the Receivables to the Transferors in such electronic form as the
Transferors may reasonably request and shall transfer all other records,
correspondence and documents to the Transferors in the manner and at such times
as the Transferors shall reasonably request. To the extent that compliance with
this Section 10,02 shall require the Successor Servicer to disclose to the
Transferors information of any kind which the Successor Servicer deems to be
confidential, the Transferors shall be required to enter into such customary
licensing and confidentiality agreements as the Successor Servicer shall deem
necessary to protect its interests,
Section 10.03 Notification to Certificateholders. Upon the occurrence
of any Servicer Default, the Servicer shall give prompt written notice thereof
to the Trustee, the Rating Agencies and any Enhancement Provider, and the
Trustee shall give notice to the Investor Certificateholders at their respective
addresses appearing in the Certificate Register. Upon any termination or
appointment of a Successor Servicer pursuant to this Article X, the Trustee
shall give prompt written notice thereof to Investor Certificateholders at their
respective addresses appearing in the Certificate Register, the Rating Agencies
and to any Enhancement Provider. Notice to Holders of Bearer Certificates shall
be given by publication in the manner described in Section 13.05 of the
Agreement.
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Section 10.04 Waiver of Past Defaults. The Holders of Investor
Certificates evidencing Undivided Interests aggregating more than 66-2/3% of the
Invested Amount of any Series then outstanding affected by any default by the
Servicer or by a Transferor may, on behalf of all Holders of Certificates of
such affected Series, waive any default by the Servicer or such Transferor in
the performance of their respective obligations hereunder and its consequences,
except a default in the failure to make any required deposits or payments of
interest or principal with respect to any Series of Certificates. Upon any such
waiver of a past default, such default shall cease to exist, and any default
arising therefrom shall be deemed to have been remedied for every purpose of
this Agreement. No such waiver shall extend to any subsequent or other default
or impair any right consequent thereon except to the extent expressly so waived.
[END OF ARTICLE X]
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ARTICLE XI
THE TRUSTEE
Section 11.01 Duties of Trustee.
(a) The Trustee, prior to the occurrence of a Servicer Default
or Pay Out Event and after the curing or waiving of all Servicer Defaults or Pay
Out Events which may have occurred, undertakes to perform such duties and only
such duties as are specifically set forth in this Agreement. If a Servicer
Default or Pay Out Event has occurred (which has not been cured or waived), the
Trustee (as trustee and not Successor Servicer) shall exercise such of the
rights and powers vested in it by this Agreement or any Supplement, and use the
same degree of care and skill in their exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) The Trustee, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Trustee which are specifically required to be
furnished pursuant to any provision of this Agreement or any Supplement, shall
examine them to determine whether they conform as to form to the requirements of
this Agreement or any Supplement, but shall not be required to verify the
accuracy of any information, calculations or conclusions stated therein. The
Trustee shall give prompt written notice to the Certificateholders (or, in the
case of Holders of Bearer Certificates, notice by publication in the manner
described in Section 13.05 of the Agreement) of any material lack of conformity
of any such instrument to the applicable requirements of this Agreement or any
Supplement discovered by the Trustee which would entitle a specified percentage
of the Investor Certificateholders to take any action pursuant to this Agreement
or any Supplement.
(c) Subject to Section 11.01(a) of this Agreement, no
provision of this Agreement or any Supplement shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own willful misconduct; provided, however, that:
(i) the Trustee shall not be liable for an error of judgment
made in good faith by a Responsible Officer or Responsible Officers of
the Trustee, unless it shall be proved that the Trustee was negligent
in ascertaining the pertinent facts;
(ii) the Trustee shall not be personally liable with respect
to any action taken, suffered or omitted to be taken by it in good
faith in accordance with the direction of the Holders of Investor
Certificates evidencing Undivided Interests aggregating more than 50%
of the Invested Amount of any Series adversely affected thereby
relating to the time, method and place of conducting any proceeding for
any remedy available to the Trustee, or exercising any trust or power
conferred upon the Trustee, under this Agreement or any Supplement;
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(iii) the Trustee shall not be charged with knowledge of any
failure by the Servicer (other than the Trustee, in its capacity as
Successor Servicer) to comply with the obligations of the Servicer
referred to in clauses (a), (b) and (c) of Section 10.01 unless a
Responsible Officer of the Trustee obtains actual knowledge of such
failure (it being understood that knowledge of the Servicer, in its
capacity as agent for the Trustee, is not attributable to the Trustee)
or the Trustee receives written notice of such failure from the
Servicer or any Holders of Investor Certificates evidencing Undivided
Interests aggregating more than 50% of the Invested Amount of any
Series adversely affected thereby;
(iv) in making a determination of any material and adverse
effect upon Certificateholders, the Investor Certificates, the Trustee
may, as to matters of law, rely exclusively upon an Opinion of Counsel.
(d) The Trustee (in its capacity as such) shall not be
required to expend or risk its own funds or otherwise incur financial liability
in the performance of any of its duties hereunder, or in the exercise of any of
its rights or powers, if there is reasonable ground for believing that the
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it, and none of the provisions contained in this
Agreement or any Supplement shall in any event require the Trustee to perform,
or be responsible for the manner of performance of, any of the obligations of
the Servicer or the Successor Servicer under this Agreement or any Supplement
except during such time, if any, as the Trustee shall be the Successor Servicer
in accordance with the terms of this Agreement or any Supplement.
(e) Except for actions expressly authorized by this Agreement
or any Supplement, the Trustee shall take no action reasonably likely to impair
the interests of the Trust in any Receivable now existing or hereafter created
or to impair the value of any Receivable now existing or hereafter created.
(f) Except as specifically provided in this Agreement, the
Trustee shall have no power to vary the corpus of the Trust.
(g) In the event that the Paying Agent or the Transfer Agent
and Registrar shall not be the Trustee and fail to perform any obligation, duty
or agreement in the manner or on the day required to be performed by the Paying
Agent or the Transfer Agent and Registrar, as the case may be, under this
Agreement, the Trustee shall be obligated promptly upon its knowledge thereof to
perform such obligation, duty or agreement in the manner so required but shall
not be required to make a payment out of its own funds.
(h) Any action, suit or proceeding brought in respect of one
or more particular Series shall have no effect on the Trustee's rights, duties
and obligations hereunder with respect to any one or more Series not the subject
of such action, suit or proceeding.
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Section 11.02 Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 11.01:
(a) the Trustee may request, rely on and shall be protected in
acting on, or in refraining from acting in accord with, any resolution,
Officer's Certificate, Opinion of Counsel, certificate of independent public
accountants or any other certificate statement, instrument, opinion, report,
notice, request, consent, order, appraisal, bond or other paper or document,
including, without limitation, any request or instruction by the Servicer or the
Transferor to make any deposit or payment or any draw on any Enhancement or to
transfer any Receivables or Accounts, believed by it to be genuine and to have
been signed or presented to it pursuant to this Agreement or any Supplement by
the proper party or parties;
(b) the Trustee may consult with counsel as to matters of law
and any Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or omitted by it hereunder
in good faith and in accordance with such Opinion of Counsel as to any actions
required to be taken or withheld hereunder;
(c) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Agreement or any Supplement, or to
institute, conduct or defend any litigation hereunder or in relation hereto, at
the request, order or direction of any of the Certificateholders or Certificate
Owners, pursuant to the provisions of this Agreement or any Supplement, unless
such Certificateholders or Certificate Owners, shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which may be incurred therein or thereby; nothing contained herein shall,
however, relieve the Trustee (as Trustee but not as Successor Servicer) of the
obligations, upon the occurrence of any Servicer Default (which has not been
cured or waived), to exercise such of the rights and powers vested in it by this
Agreement or any Supplement, and to use the same degree of care and skill in
their exercise as a prudent person would exercise or use under the circumstances
in the conduct of such person's own affairs;
(d) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this Agreement or
any Supplement;
(e) the Trustee shall not be bound to make any investigation
into the facts of matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond or
other paper or document, except to the extent specifically requested in writing
so to do by Holders of Investor Certificates evidencing Undivided Interests
aggregating more than 50% of the Invested Amount of any Series which could be
adversely affected if the Trustee does not perform such acts and the Trustee is
reasonably indemnified therefor;
(f) the Trustee (in its capacity as such) may execute any of
the trusts or powers hereunder or perform any duties hereunder either directly
or by or through agents or attorneys or a custodian, and the Trustee (in its
capacity as such) shall not be responsible for any misconduct or negligence on
the part of any such agent, attorney or custodian appointed with due care by it
hereunder;
(g) except as may be required by subsection 11.01(a) or
11.01(b) hereof, the Trustee shall not be required to make any initial or
periodic examination of any documents or records related to the Receivables or
the Accounts for the purpose of establishing the presence or absence of defects,
the compliance by the Transferor or Servicer with their representations,
warranties or covenants or for any other purpose;
80
(h) whether or not therein expressly so provided, every
provision of this Agreement or any Supplement relating to the conduct or
affecting the eligibility of or affording protection to the Trustee (in its
capacity as such) shall be subject to the provisions of Sections 11.01, 11.02
and 11.03;
(i) the permissive right of the Trustee to take actions
enumerated in this Agreement or any Supplement shall not be construed as a duty;
(j) whenever in the administration of this Agreement or any
Supplement, the Trustee shall deem it desirable that a matter be proved or
established prior to taking, suffering or omitting any action hereunder, the
Trustee (unless other evidence be herein specifically prescribed) may, in the
absence of bad faith on its part, rely upon an Officer's Certificate;
(k) no implied covenants or obligations shall be read into
this Agreement against the Trustee;
(l) without limiting the generality of this Section or Section
11.01, the Trustee shall have no duty (i) to see to any recording, filing, or
depositing of the Agreement or any agreement referred to therein or any
financing statement or continuation statement evidencing a security interest in
the Receivables or the Accounts, or to see to the maintenance of any such
recording, filing or depositing or any rerecording, refiling or redepositing of
any thereof, or (ii) to confirm or verify the contents of any reports or
certificates of the Servicer delivered to the Trustee pursuant to the Agreement
believed by the Trustee to be genuine and to have been signed or presented by
the proper party or parties; and
(m) the Trustee shall not be deemed to be a fiduciary for the
Enhancement Provider, if any, in its capacity as such, and the Trustee's sole
responsibility with respect to the Enhancement Provider in its capacity as such,
shall be to perform those duties with respect to the Enhancement Provider as are
specifically set forth in the Agreement and no implied covenants shall be read
into the Agreement against the Trustee with respect to the Enhancement Provider.
Section 11.03 Trustee Not Liable for Recitals in Certificates. The
Trustee assumes no responsibility for the correctness of the recitals contained
herein and in the Certificates (other than the certificates of authentication on
the Certificates). Except as set forth in Section 11.15, the Trustee makes no
representations as to (i) the validity or sufficiency of this Agreement or any
Supplement or of the Certificates (other than the certificates of authentication
on the Certificates), (ii) the existence or validity of any Receivable, (iii)
the validity of any transfer or assignment of any Receivable to the Trust, (iv)
the validity of any grant of a security interest to the Trust in any Receivable,
(v) the perfection of any security interest (whether as of the date hereof or at
any future time) in any Receivable, (vi) the maintenance of or the taking of any
action to maintain such perfection, (vii) the receipt by the Trustee or the
Servicer of any Receivable, (viii) the performance or enforcement of any
Receivable, (ix) the compliance by the Transferor or the Servicer with any
covenant or representation, (x) the breach by the Transferor or the Servicer of
any warranty or representation made hereunder or in any related document or the
accuracy of any such warranty or representation or (xi) any action taken by the
Servicer in the name of the Trustee. The Trustee shall not be accountable for
the use or application by the Transferor of any of the Certificates or of the
proceeds of such Certificates, or for the use or application of any funds paid
to the Transferors in respect of the Receivables or deposited in or withdrawn
from the Collection Account or other Accounts now or hereafter established to
effectuate the transactions contemplated herein and in accordance with the terms
hereof.
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Section 11.04 Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of Investor
Certificates with the same rights as it would have if it were not the Trustee.
Section 11.05 The Servicer to Pay Trustee's Fees and Expenses. The
Servicer covenants and agrees to pay to the Trustee from time to time, and the
Trustee shall be entitled to receive, reasonable compensation (which shall not
be limited by any provision of law in regard to the compensation of a trustee of
an express trust) for all services rendered by it in the execution of the trust
hereby created and in the exercise and performance of any of the powers and
duties hereunder of the Trustee, and, subject to Section 8.04, the Servicer will
pay or reimburse the Trustee (without reimbursement from the Collection Account
or otherwise) upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any of the
provisions of this Agreement or any Supplement (including the reasonable fees
and expenses of its agents and counsel) except any such expense, disbursement or
advance as may arise from its negligence or bad faith and except as provided in
the following sentence. If the Trustee is appointed Successor Servicer pursuant
to Section 10.02, the provisions of this Section 11.05 shall not apply to
expenses, disbursements and advances made or incurred by the Trustee in its
capacity as Successor Servicer; provided that the Transferors will indemnify,
defend and save harmless the Trustee for any loss, liability or expense incurred
by it as Successor Servicer which is not otherwise reimbursed hereunder, except
to the extent such loss, liability or expense is due to its negligence or bad
faith as Successor Servicer.
The obligations of the Servicer and the Transferor under this
Section 11.05, Section 7.04, Section 8.04 and Section 11.17 shall survive the
termination of the Trust and the resignation or removal of the Trustee or the
Servicer.
Section 11.06 Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be a corporation or national banking association
organized and doing business under the laws of the United States of America or
any state thereof authorized under such laws to exercise corporate trust powers,
having a combined capital and surplus of at least $50,000,000, a rating as to
its long-term unsecured debt obligations of at least Baa3 by ▇▇▇▇▇'▇ (if ▇▇▇▇▇'▇
shall then be a Rating Agency) and a rating as to its short-term deposits or
long-term unsecured debt obligations that satisfies the rating requirement of
any other applicable Rating Agency and subject to supervision or examination by
Federal or state authority. If such corporation or national banking association
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purpose of this Section 11.06, the combined capital and surplus of such
corporation or national banking association shall be deemed to be its combined
capital and surplus as set forth in its most recent report of condition so
published. In case at any time the Trustee shall cease to be eligible in
accordance with the provisions of this Section 11.06, the Trustee shall resign
immediately in the manner and with the effect specified in Section 11.07.
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Section 11.07 Resignation or Removal of Trustee.
(a) The Trustee may at any time resign as Trustee and be
discharged from the trust hereby created by giving written notice thereof to the
Transferors and the Servicer. Upon receiving such notice of resignation, the
Transferors shall promptly appoint a successor trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor trustee. If no successor trustee shall
have been so appointed and have accepted within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 11.06 hereof and shall fail to resign
after written request therefor by the Transferors, or if at any time the Trustee
shall be legally unable to act, or shall be adjudged a bankrupt or insolvent, or
a receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Transferor may, but shall not be required to, remove the Trustee and promptly
appoint a successor trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the Trustee so removed and one copy to
the successor trustee and shall promptly pay all fees owed to the outgoing
Trustee.
(c) Any resignation or removal of the Trustee and appointment
of a successor trustee pursuant to any of the provisions of this Section 11.07
shall not become effective until acceptance of appointment by the successor
trustee as provided in Section 11.08 hereof and payment of all fees and expenses
owed to the outgoing Trustee. Any such liability of the Trustee arising
hereunder shall survive such appointment of a successor trustee.
Section 11.08 Successor Trustee.
(a) Any successor trustee appointed as provided in Section
11.07 hereof shall execute, acknowledge and deliver to the Transferors and to
its predecessor Trustee an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the predecessor Trustee shall become
effective and such successor trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder and under any Supplement, with like
effect as if originally named as Trustee herein. The predecessor Trustee shall
upon payment of its fees and expenses deliver to the successor trustee all
documents held by it hereunder, and the Transferors and the predecessor Trustee
shall execute and deliver such instruments and do such other things as may
reasonably be required for fully and certainly vesting and confirming in the
successor trustee all such rights, powers, duties and obligations.
(b) No successor trustee shall accept appointment as provided
in this Section 11.08 unless at the time of such acceptance such successor
trustee shall be eligible under the provisions of Section 11.06 hereof.
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(c) Upon acceptance of appointment by a successor trustee as
provided in this Section 11.08 hereof, such successor trustee shall mail notice
of such succession hereunder to all Certificateholders (other than Holders of
Bearer Certificates) at their addresses as shown in the Certificate Register.
Notice to Holders of Bearer Certificates shall be given by publication in the
manner described in Section 13.05 of the Agreement.
Section 11.09 Merger or Consolidation of Trustee. Any Person into which
the Trustee may be merged or converted or with which it may be consolidated, or
any Person resulting from any merger, conversion or consolidation to which the
Trustee shall be a party, or any Person succeeding to the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder
provided such Person shall be eligible under the provisions of Section 11.06
hereof, without the execution or filing of any paper or any further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding.
Section 11.10 Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provision of this Agreement or
any Supplement, at any time, for the purpose of meeting any legal requirements
of any jurisdiction in which any part of the Trust may at the time be located,
the Trustee shall have the power and may execute and deliver all instruments to
appoint one or more Persons to act as a co-trustee, or separate trustee, of all
or any part of the Trust, and to vest in such Person, in such capacity and for
the benefit of the Certificateholders, such title to the trust, or any part
thereof, and, subject to the other provisions of this Section 11.10, such
powers, duties, obligations, rights and trusts as the Trustee may consider
necessary or desirable. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
11.06 and no notice to Certificateholders of the appointment of any co-trustee
or separate trustee shall be required under Section 11.08 hereof.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee or
co-trustee is not authorized to act separately without the Trustee
joining in such act), except to the extent that under any laws of any
jurisdiction in which any particular act or acts are to be performed
(whether as Trustee hereunder or as successor to the Servicer
hereunder), the Trustee shall be incompetent or unqualified to perform
such act or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust or any portion
thereof in any such jurisdiction) shall be exercised and performed
singly by such separate trustee or co-trustee, but solely at the
direction of the Trustee;
(ii) no trustee hereunder shall be personally liable by reason
of any act or omission of any other trustee hereunder appointed with
due care; and
(iii) the Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee,
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(c) Any notice, request or other writing given to the Trustee
shall be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article XI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement or any Supplement, specifically including every provision of
this Agreement or any Supplement relating to the conduct of, affecting the
liability of, or affording protection to, the Trustee. Every such instrument
shall be filed with the Trustee and a copy thereof given to the Servicer.
(d) Any separate trustee or co-trustee may at any time appoint
the Trustee, its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect to this
Agreement or any Supplement on its behalf and in its name. If any separate
trustee or co-trustee shall die, become incapable of acting, resign or be
removed, all of its estates, properties, rights, remedies and trusts shall vest
in and be exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 11.11 Tax Returns. In the event the Trust shall be required to
file tax returns, the Servicer shall prepare or cause to be prepared and is
authorized hereunder to sign any tax returns required to be filed by the Trust
and, to the extent possible, shall file such returns at least five days before
such returns are due to be filed. The Servicer shall prepare or shall cause to
be prepared all tax information required by law to be distributed to
Certificateholders and Certificate Owners and shall deliver such information to
the Paying Agent at least five days prior to the date it is required by law to
be distributed to Certificateholders and Certificate Owners. The Servicer will
furnish to the Trustee an opinion of Counsel as to the preparation of all tax
returns of the Trust. In no event shall the Trustee, the Paying Agent, the
Transferors or the Servicer be liable for any liabilities, costs or expenses of
the Trust, the Investor Certificateholders or the Certificate Owners arising
under any tax law, including without limitation, Federal, state or local income
or excise taxes or any other tax imposed on or measured by income (or any
interest or penalty with respect thereto or arising from a failure to comply
therewith), except to the extent that such tax is imposed as a result of a
violation by such Person of the provisions of this Agreement or any Supplement.
Section 11.12 Trustee May Enforce Claims Without Possession of
Certificates. All rights of action and claims under this Agreement or any
Supplement or the Certificates may be prosecuted and enforced by the Trustee
without the possession of any of the Certificates or the production thereof in
any proceeding relating thereto, and any such proceeding instituted by the
Trustee shall be brought in its own name as trustee. Any recovery of judgment
shall, after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Certificateholders in respect of which such judgment has
been obtained.
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Section 11.13 Suits for Enforcement. If a Servicer Default shall occur
and be continuing, the Trustee, in its discretion may, subject to the provisions
of Section 10.01, proceed to protect and enforce its rights and the rights of
the Certificateholders under this Agreement or any Supplement, by such suit,
action or proceeding in equity or at law or otherwise, whether for the specific
performance of any covenant or agreement contained in this Agreement or any
Supplement or in aid of the execution of any power granted in this Agreement or
any Supplement or for the enforcement of any other legal, equitable or other
remedy as the Trustee, being advised by counsel, shall deem effectual to protect
and enforce any of the rights of the Trustee or the Certificateholders.
Section 11.14 Rights of Certificateholders to Direct Trustee. Holders
of Investor Certificates evidencing Undivided Interests aggregating more than
50% of the Invested Amount of any Series affected by the conduct of any
proceeding or the exercise of any right conferred on the Trustee shall have the
right to direct the times, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power conferred on
the Trustee; provided, however, that, subject to Section 11.01, the Trustee
shall have the right to decline to follow any such direction if the Trustee
being advised by counsel determines that the action so directed may not lawfully
be taken, or if the Trustee in good faith shall, by a Responsible Officer or
Responsible Officers of the Trustee, determine that the proceedings so directed
would be illegal or involve it in personal liability or be unduly prejudicial to
the rights of Certificateholders not parties to such direction; and provided
further that nothing in this Agreement or any Supplement shall impair the right
of the Trustee to take any action deemed proper by the Trustee and which is not
inconsistent with such direction.
Section 11.15 Representations and Warranties of Trustee. The Trustee
represents and warrants that:
(i) The Trustee is a banking corporation, organized, existing
and in good standing under the laws of the State of New York;
(ii) The Trustee has full power, authority and right to
execute, deliver and perform this Agreement and any Supplement, and has
taken all necessary action to authorize the execution, delivery and
performance by it of this Agreement and any Supplement; and
(iii) This Agreement and any Supplement has been duly executed
and delivered by the Trustee, and assuming due execution and delivery
by the other parties thereto constitutes a legal, valid and binding
obligation of the Trustee enforceable against the Trustee in accordance
with its terms.
Section 11.16 Maintenance of Office or Agency. The Trustee will
maintain at its expense in the Borough of Manhattan, The City of New York, an
office or offices or agency or agencies where notices and demands to or upon the
Trustee in respect of the Certificates and this Agreement may be served. The
Trustee initially appoints its Corporate Trust Office as its office for such
purposes in New York. The Trustee will give prompt written notice (or in the
case of Holders of Bearer Certificates, notice by publication in the manner
described in Section 13.05 of the Agreement) to the Servicer and to
Certificateholders of any change in the location of the Certificate Register or
any such office or agency.
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Section 11.17 Indemnification of the Trustee. The Transferors shall
jointly and severally indemnify the Trustee for, and hold it harmless against,
any loss, liability or expense incurred without negligence or willful misconduct
on the part of the Trustee arising out of any third-party claim or alleged
third-party claim in connection with the exercise or performance of any of its
powers or duties under this Agreement, The Trustee shall have a lien on any and
all amounts which are payable to the Transferors with respect to amounts due and
owing to the Trustee pursuant to this Section 11.17. The amount of the
Transferors' liability under this Section 11.17 shall be subordinate to the
security interest of the Trust in the Receivables and shall be payable from the
assets of the Transferors at the time such liability is asserted and at any time
thereafter. The provisions of this Section 11.17 shall survive the termination
of this Agreement and the resignation or removal of the Trustee.
[END OF ARTICLE XI]
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ARTICLE XII
TERMINATION
Section 12.01 Termination of Trust.
(a) The respective obligations and responsibilities of each
Transferor, the Servicer, the Paying Agent and the Trustee and their agents
hereunder created hereby (other than the obligation of the Trustee to make
payments to Certificateholders as hereafter set forth) shall terminate, except
with respect to the duties described in Sections and subsections 2.04(c), 7.04,
8.04, 11.05, 11.17 and 12.03(b), upon the earlier of (i) the day following the
date on which funds shall have been deposited in the Collection Account
sufficient to pay the Aggregate Invested Amount plus applicable Certificate
Interest accrued through the last day of the interest accrual period preceding
such Distribution Date in full on all Series of Investor Certificates and (ii)
July 15, 2092 (the "Final Termination Date") provided, however, that in no event
shall the trust created by this Agreement continue beyond the expiration of 21
years from the death of the last survivor of the descendants of ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇, formerly United States representative at the Court of St. ▇▇▇▇▇, of the
Commonwealth of Massachusetts, living on the date of this Agreement.
(b) If on the Distribution Date in the month immediately
preceding the month in which the Final Termination Date occurs (after giving
effect to all transfers, withdrawals, deposits and drawings to occur on such
date and the payment of principal on any Series of Certificates to be made on
such Distribution Date pursuant to Article IV) the Invested Amount of any Series
would be greater than zero, the Servicer shall sell on or prior to the
succeeding Distribution Date all of the Receivables in a commercially reasonable
manner and on commercially reasonable terms which shall include the solicitation
of competitive bids and shall consummate the sale with the highest bidder for
the Receivables. Each of the Transferors or any of their respective Affiliates
shall be permitted to bid for the Receivables. In addition, each of the
Transferors or their respective Affiliates shall have the right to match any bid
by a third Person and be granted the right to purchase the Receivables at such
matched bid price. The proceeds of any such sale shall be treated as Collections
on the Receivables and shall be allocated in accordance with Article IV;
provided, however, that the Trustee shall determine conclusively the amount of
such proceeds which are allocable to Yield Collections and the amount of such
proceeds which are allocable to Principal Collections. Prior to such sale of
Receivables, the Servicer shall continue to collect Collections on the
Receivables and allocate such payments in accordance with the provisions of
Article IV.
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Section 12.02 Optional Purchase; Final Termination Date of Investor
Certificates of any Series.
(a) If provided in any Supplement with respect to a Series on
any Distribution Date either or both of the Transferors may, but shall not be
obligated to, purchase any such Series of Investor Certificates by depositing
into the Collection Account, on the Distribution Date, an amount equal to the
Invested Amount thereof plus interest accrued and unpaid thereon at the
applicable Certificate Rate through the interest accrual period related to such
Distribution Date on which the purchase will be made; provided, however, that no
such purchase of any Series of Investor Certificates shall occur unless the
Transferors shall deliver to the Trustee and the Rating Agencies an Opinion of
Counsel reasonably acceptable to the Trustee that such purchase of any Series of
Investor Certificates would not constitute a fraudulent conveyance of any
Transferor. Nothing herein limits the right of TRS or any Affiliate to purchase
Investor Certificates on the open market and submit them to the Trustee for
cancellation.
(b) The amount deposited pursuant to subsection 12.02(a) of
the Agreement shall be paid to the Investor Certificateholders of the related
Series pursuant to Article IV on the Distribution Date following the date of
such deposit. All Certificates of a Series which are purchased by either or both
of the Transferors pursuant to subsection 12.02(a) of the Agreement shall be
delivered by the Transferors upon such purchase to, and be cancelled by, the
Transfer Agent and Registrar and be disposed of in a manner satisfactory to the
Trustee and the Transferors.
(c) All principal or interest with respect to any Series of
Investor Certificates shall be due and payable no later than the Stated Series
Termination Date with respect to such Series. Unless otherwise provided in a
Supplement, in the event that the Invested Amount of any Series of Certificates
is greater than zero on its Stated Series Termination Date (after giving effect
to all transfers, withdrawals, deposits and drawings to occur on such date and
the payment of principal to be made on such Series on such date), the Trustee
will sell or cause to be sold, and pay the proceeds to all Certificateholders of
such Series pro rata in final payment of all principal of and accrued interest
on such Series of Certificates, an amount of Receivables or interests in
Receivables up to 110% of the Invested Amount of such Series at the close of
business on such date (but not more than an amount of Receivables equal to the
sum of (1) the product of (A) the Transferor Percentage, (B) the Trust Principal
Component and (C) a fraction the numerator of which is the related Invested
Percentage of Yield Collections and the denominator of which is the sum of all
Invested Percentages with respect to Yield Collections of all Series outstanding
and (2) the Invested Amount of such Series). The Trustee shall conduct the sale
of Receivables in a commercially reasonable manner and on commercially
reasonable terms which shall include the solicitation of competitive bids and
shall consummate the sale with the highest bidder for the Receivables. The
Transferors or any of their respective Affiliates shall be permitted to bid for
the Receivables. In addition, the Transferors or any of their respective
Affiliates shall have the right to match any bid by a third Person and be
granted the right to purchase the Receivables at such matched bid price, Any
proceeds of such sale in excess of such principal and interest paid shall be
paid to the Holder of the Exchangeable Transferor Certificate. Upon such Stated
Series Termination Date with respect to the applicable Series of Certificates,
final payment of all amounts allocable to any Investor Certificates of such
Series shall be made in the manner provided in Section 12.03 of the Agreement.
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Section 12.03 Final Payment with Respect to any Series.
(a) Written notice of any termination, specifying the
Distribution Date upon which the Investor Certificateholders of any Series may
surrender their Certificates for payment of the final distribution with respect
to such Series and cancellation, shall be given (subject to at least two
Business Days' prior notice from the Servicer to the Trustee) by the Trustee to
Investor Certificateholders of such Series mailed not later than the fifth day
of the month of such final distribution (or in the case of the Holders of Bearer
Certificates by the publication by the Trustee of a notice at least once in a
newspaper of general circulation in Luxembourg (which newspaper shall be printed
in the English language and customarily published on each business day in
Luxembourg) and, so long as the Investor Certificates are listed on the
Luxembourg Stock Exchange or other stock exchange and such exchange so requires,
in Luxembourg or the location required by such other stock exchange) specifying
(a) the Distribution Date (which shall be the Distribution Date in the month in
which the deposit is made pursuant to Section 2.07 or subsection 12.02(a) of the
Agreement) upon which final payment of such Investor Certificates will be made
upon presentation and surrender of such Investor Certificates at the office or
offices therein designated, (which, in the case of Bearer Certificates, shall be
outside the United States), (b) the amount of any such final payment and (c)
that the Record Date otherwise applicable to such Distribution Date is not
applicable, payments being made only upon presentation and surrender of the
Investor Certificates at the office or offices therein specified. The Servicer's
notice to the Trustee in accordance with the preceding sentence shall be
accompanied by an Officers' Certificate setting forth the information specified
in the applicable Supplement covering the period during the then current
calendar year through the date of such notice and setting forth the date of such
final distribution. The Trustee shall give such notice to the Transfer Agent and
Registrar and the Paying Agent at the time such notice is given to such Investor
Certificateholders.
(b) Notwithstanding the termination of the Trust pursuant to
subsection 12.01(a) of the Agreement or the occurrence of the Stated Series
Termination Date with respect to any Series pursuant to Section 12.02 of the
Agreement, all funds then on deposit in the Collection Account shall continue to
be held in trust for the benefit of the Certificateholders and the Paying Agent
or the Trustee shall pay such funds to the Certificateholders upon surrender of
their Certificates (which surrenders and payments, in the case of Bearer
Certificates, shall be made only outside the United States). In the event that
all of the Investor Certificateholders of such Series shall not surrender their
Certificates for cancellation within six months after the date specified in the
above-mentioned notice, the Trustee shall give a second written notice (or in
the case of Bearer Certificates, publication notice) to the remaining Investor
Certificateholders of such Series upon receipt of the appropriate records from
the Transfer Agent and Registrar to surrender their Certificates for
cancellation and receive the final distribution with respect thereto. If within
one and one-half years after the second notice all the Investor Certificates of
such Series shall not have been surrendered for cancellation, the Trustee may
take appropriate steps, or may appoint an agent to take appropriate steps, to
contact the remaining Investor Certificateholders of such Series concerning
surrender of their Certificates, and the cost thereof shall be paid out of the
funds in the Collection Account held for the benefit of such Investor
Certificateholders.
(c) All Certificates surrendered for payment of the final
distribution with respect to such Certificates and cancellation shall be
cancelled by the Transfer Agent and Registrar and be disposed of in a manner
satisfactory to the Trustee and the Transferors.
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Section 12.04 Transferors' Termination Rights. Upon the termination of
the Trust pursuant to Section 12.01 and the surrender of the Exchangeable
Transferor Certificate, the Trustee shall return to the Transferors (without
recourse, representation or warranty) all right, title and interest of the Trust
in the Receivables, whether then existing or hereafter created, and all monies
due or to become due with respect thereto, all proceeds thereof except for
amounts held by the Paying Agent pursuant to subsection 12.03(b). The Trustee
shall execute and deliver such instruments of transfer and assignment, in each
case without recourse, as shall be reasonably requested by the Transferors to
vest in itself all right, title and interest which the Trust had in the
applicable Receivables and the Trustee shall be entitled to receive and rely
conclusively upon an Opinion of Counsel as to its execution and delivery of such
instruments being in compliance herewith.
[END OF ARTICLE XII]
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ARTICLE XIII
MISCELLANEOUS PROVISIONS
Section 13.01 Amendment.
(a) This Agreement and any Supplement may be amended from time
to time by the Servicer, the Transferors and the Trustee, without the consent of
any of the investor Certificateholders, to cure any ambiguity, to correct or
supplement any provisions herein which may be inconsistent with any other
provisions herein or to add any other provisions with respect to matters or
questions raised under this Agreement which shall not be inconsistent with the
provisions of this Agreement, including (i) any matters arising under subsection
2.05(d) of the Agreement necessary to effect the conveyance contemplated
thereunder, (ii) to add, modify or eliminate such provisions as the Transferors
may deem necessary or advisable in order to enable all or a portion of the Trust
(A) to qualify as, and to permit an election to be made to cause the Trust to be
treated as, a "financial asset securitization investment trust" as described in
the provisions of Section 860L of the Internal Revenue Code and (B) to avoid the
imposition of state or local income or franchise taxes imposed on the Trust's
property or its income and (iii) the addition or deletion of a sale of
Receivables and termination of the Trust upon the occurrence of an insolvency of
either of the Transferors; provided, however, that such action shall not
adversely affect in any material respect the interests of any of the Investor
Certificateholders. Additionally, this Agreement and any Supplement may be
amended from time to time by the Servicer, the Transferors and the Trustee,
without the consent of any of the Certificateholders, to add to or change any of
the provisions of this Agreement to provide that Bearer Certificates may be
registrable as to principal, to change or eliminate any restrictions on the
payment of principal of (or premium, if any) or any interest on Bearer
Certificates to comply with the Bearer Rules, to permit Bearer Certificates to
be issued in exchange for Registered Certificates (if then permitted by the
Bearer Rules), to permit Bearer Certificates to be issued in exchange for Bearer
Certificates of other authorized denominations or to permit the issuance of
Certificates in uncertificated form, provided any such action shall not
adversely affect the interests of the Holders of Bearer Certificates of any
Series or any related Coupons in any material respect unless such amendment is
necessary to comply with the Bearer Rules. Prior to executing any amendment in
accordance with this subsection 13.01(a), the Trustee shall receive and shall be
permitted to rely upon an Opinion of Counsel to the effect that the conditions
and requirements of this subsection 13.01(a) have been satisfied.
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(b) This Agreement and any Supplement may also be amended from
time to time by the Servicer, the Transferors and the Trustee, without the
consent of any of the Certificateholders, for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
this Agreement, or of modifying in any manner the rights of the Holders of
Investor Certificates; provided that (i) the Servicer shall have provided an
Opinion of Counsel to the Trustee to the effect that such amendment will not
materially and adversely affect the interests of the Investor Certificateholders
of any outstanding Series (or 100% of the class of Certificateholders so
affected shall have consented), (ii) such amendment shall not, as evidenced by
an Opinion of Counsel, cause the Trust to be characterized for Federal income
tax purposes as an association taxable as a corporation or otherwise have any
material adverse impact on the Federal income taxation of any outstanding Series
of Investor Certificates or any Certificate Owner and (iii) the Rating Agencies
shall confirm that such amendment shall not cause a reduction or withdrawal of
the rating of any outstanding Series of Certificates; provided, further, that
such amendment shall not reduce in any manner the amount of, or delay the timing
of, distributions which are required to be made on any Investor Certificate of
such Series without the consent of the related Investor Certificateholder,
change the definition of or the manner of calculating the interest of any
Investor Certificateholder of such Series without the consent of the related
Investor Certificateholder or reduce the percentage pursuant to clause (b)
required to consent to any such amendment, in each case without the consent of
all such Investor Certificateholders; provided further that such action shall
not effect a change in the Permitted Activities of the Trust except for those
changes necessary for compliance with accounting requirements or tax
requirements or required to cure any ambiguity or correct or supplement any
provision contained in this Agreement or any Supplement which may be defective
or inconsistent with any provisions thereof.
(c) This Agreement and any Supplement may also be amended from
time to time by the Servicer, the Transferors and the Trustee (A) in the case of
a change in the Permitted Activities of the Trust which is not materially
adverse to Holders of Investor Certificates, with the consent of Holders of
Investor Certificates evidencing not less than 50% of the aggregated unpaid
principal amount of the Investor Certificates of each outstanding Series
affected by such change, unless such change is necessary for compliance with
accounting requirements or tax requirements or required to cure any ambiguity or
correct or supplement any provision contained in this Agreement or any
Supplement which may be defective or inconsistent with any provisions thereof
and (B) in all other cases with the consent of the Holders of Investor
Certificates evidencing Undivided Interests aggregating not less than 66-2/3% of
the Invested Amount of all Series adversely affected, for the purpose of adding
any provisions to or changing in any manner or eliminating any of the provisions
of this Agreement or modifying in any manner the rights of the Investor
Certificateholders of any Series then issued and outstanding; provided, however,
that no such amendment shall (i) reduce in any manner the amount of, or delay
the timing of, distributions which are required to be made on any Investor
Certificate of such Series without the consent of the related Investor
Certificateholders, (ii) change the definition of or the manner of calculating
the Invested Amount, the Invested Percentage, the applicable available amount
under any Enhancement or the Investor Default Amount of such Series without the
consent of each related Investor Certificateholders or (iii) reduce the
aforesaid percentage required to consent to any such amendment, without the
consent of each related Investor Certificateholder.
(d) Promptly after the execution of any such amendment or
consent the Trustee shall furnish written notification (or in the case of Bearer
Certificates, publication notice in the manner described in Section 13.05 of the
Agreement) of the substance of such amendment to each Investor
Certificateholder, and the Servicer shall furnish written notification of the
substance of such amendment to any related Enhancement Provider and each Rating
Agency.
(e) It shall not be necessary for the consent of Investor
Certificateholders under this Section 13.01 to approve the particular form of
any proposed amendment, but it shall be sufficient if such Certificateholders
shall approve the substance thereof. The manner of obtaining such consents and
of evidencing the authorization of the execution thereof by Investor
Certificateholders shall be subject to such reasonable requirements as the
Trustee may prescribe.
93
(f) Any Assignment or Reassignments regarding the addition to
or removal of Receivables from the Trust respectively, as provided in Sections
2.06 and 2.07, respectively, of the Agreement executed in accordance with the
provisions hereof shall not be considered amendments to this Agreement,
including, without limitation, for the purpose of subsections 13.01(a), (b), (c)
and (g) of the Agreement,
(g) Prior to the execution of any amendment to the Agreement,
the Trustee shall be entitled to receive and rely upon an Opinion of Counsel
substantially in the form of Part Two of Exhibit G, The Trustee may, but shall
not be obligated to enter into any such amendment which affects the Trustee's
own rights, duties or immunities under the Agreement or otherwise.
Section 13.02 Protection of Right, Title and Interest to Trust.
(a) The Servicer shall cause this Agreement, any Supplement,
all amendments hereto and/or all financing statements, amendments to financing
statements and any other necessary documents covering the right, title and
interest of the Trust in the property conveyed hereunder to be promptly
recorded, registered and filed, and at all times to be kept recorded, registered
and filed, all in such manner and in such places as may be required by law fully
to preserve and protect the right, title and interest of the Trustee hereunder
to all property comprising the Trust. The Servicer shall deliver to the Trustee
file-stamped copies of, or filing receipts for, any document recorded,
registered or filed as provided above, as soon as available following such
recording, registration or filing. Each Transferor shall cooperate fully with
the Servicer in connection with the obligations set forth above and will execute
any and all documents reasonably required to fulfill the intent of this
subsection 13.02(a).
(b) Within 30 days after a Transferor makes any change in its
name or its type or jurisdiction of organization, such Transferor shall give the
Trustee notice of any such change and shall file such financing statements or
amendments thereto as may be necessary to continue the perfection of the Trust's
interest in the property conveyed hereunder.
(c) The Transferors and the Servicer will give the Trustee
prompt written notice of any relocation of any office from which the Servicer
services Receivables or keeps records concerning the Receivables or of its
principal executive office and whether, as a result of such relocation, the
applicable provisions of the UCC would require the filing of any amendment of
any previously filed financing statement (or amendment thereto) or of any new
financing statement and shall file such financing statements or amendments
thereto as may be necessary to continue the perfection of the Trust's security
interest in the Receivables and the proceeds thereof notwithstanding any
relocation of any office from which the Servicer services Receivables or keeps
records concerning the Receivables or of its principal executive office. The
Servicer will at all times maintain each office from which it services
Receivables, and the Transferors and the Servicer will at all times maintain
their respective principal executive offices within the United States of
America.
(d) The Servicer will deliver to the Trustee: (i) upon each
date that any Additional Accounts are to be included in the Accounts pursuant to
Section 2.06 hereof, an Opinion of Counsel substantially in the form of Part One
of Exhibit G; and (ii) on or before March 1 of each year, beginning with 1993 an
Opinion of Counsel, dated as of a date within 90 days of such day, substantially
in the form of Exhibit H.
94
Section 13.03 Limitation on Rights of Certificateholders.
(a) The death or incapacity of any Investor Certificateholder
shall not operate to terminate this Agreement or the Trust, nor shall such death
or incapacity entitle such Certificateholder's legal representatives or heirs to
claim at accounting or to take any action or commence any proceeding in any
court for a partition or winding up of the Trust, nor otherwise affect the
rights, obligations and liabilities of the parties hereto or any of them.
(b) No Investor Certificateholder shall have any right to vote
(except as provided herein) or in any manner otherwise control the operation and
management of the Trust, or the obligations of the parties hereto, nor shall any
Investor Certificateholder be under any liability to any third person by reason
of any action taken by the parties to this Agreement pursuant to any provision
hereof.
(c) No Investor Certificateholder shall have any right by
virtue of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Agreement,
unless such Certificateholder previously shall have given notice to the Trustee,
and unless the Holders of Certificates evidencing Undivided Interests
aggregating more than 66-2/3% of the Invested Amount of any Series which may be
adversely affected but for the institution of such suit, action or proceeding
shall have made written request upon the Trustee to institute such action, suit
or proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs, expenses
and liabilities to be incurred therein or thereby, and the Trustee, for 60 days
after its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to institute any such action, suit or proceeding; it being
understood and intended, and being expressly covenanted by each
Certificateholder with every other Certificateholder and the Trustee, that no
one or more Certificateholders shall have the right in any manner whatever by
virtue or by availing itself or themselves of any provisions of this Agreement
to affect, disturb or prejudice the rights of the Certificateholders of any
other of the Certificates, or to obtain or seek to obtain priority over or
preference to any other such Certificateholder, or to enforce any right under
this Agreement, except in the manner herein provided and for the equal, ratable
and common benefit of all Certificateholders. For the protection and enforcement
of the provisions of this Section 13.03, each and every Certificateholder and
the Trustee shall be entitled to such relief as can be given either at law or in
equity. Each Certificate Owner by its acquisition of a Book Entry Certificate
shall be deemed to have consented to the provisions of this Section 13.03.
Section 13.04 Governing Law. This Agreement 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.
95
Section 13.05 Notices. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered at, mailed by certified mail, return receipt requested, or
sent by facsimile transmission, to (a) in the case of RFC, to American Express
Receivables Financing Corporation, Room 507A, American Express Tower, World
Financial Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
Secretary, telecopy number (▇▇▇) ▇▇▇-▇▇▇▇, with copies to American Express
Travel Related Services Company, Inc., American Express Tower, World Financial
Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: General Counsel,
telecopy number (▇▇▇) ▇▇▇-▇▇▇▇, (b) in the case of Centurion Bank, to American
Express Centurion Bank, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
Attention: President, telecopy number (▇▇▇) ▇▇▇-▇▇▇▇, (c) in the case of FSB, at
American Express Bank, FSB, ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇,
Attention: President (facsimile no. (▇▇▇) ▇▇▇-▇▇▇▇), (d) in the case of the
Servicer, to American Express Travel Related Services Company, Inc., American
Express Tower, World Financial Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: Treasurer, telecopy number (▇▇▇) ▇▇▇-▇▇▇▇, with copies to
American Express Travel Related Services Company, Inc., American Express Tower,
World Financial Center, ▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
General Counsel, telecopy number (▇▇▇) ▇▇▇-▇▇▇▇, (e) in the case of the Trustee,
to The Bank of New York, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇, Attention: Corporate Trust Department - Asset Backed Finance Unit,
telecopy number (▇▇▇) ▇▇▇-▇▇▇▇; or, as to each party, at such other address as
shall be designated by such party in a written notice to each other party. Any
notice required or permitted to be mailed to a Certificateholder shall be given
by first class mail, postage prepaid, at the address of such Certificateholder
as shown in the Certificate Register. Any notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given, whether or not the Certificateholder receives such notice.
Any notice required or permitted to be made to Holders of Bearer
Certificates by publication shall be published in an Authorized Newspaper and,
if the Certificates of such Series are then listed on the Luxembourg Stock
Exchange and such stock exchange shall so require, in a newspaper of general
circulation in Luxembourg (which newspaper shall be printed in the English
language and customarily published on each business day in Luxembourg) and, if
the Certificates of such Series are listed on any other stock exchange and such
stock exchange shall so require, in any other city required by such stock
exchange outside the United States, or, if not practicable, elsewhere in Europe.
In case by reason of the suspension of publication of any Authorized
Newspaper or permitted newspaper with respect to Luxembourg or by reason of any
other cause it shall be impracticable to publish any notice to Holders of Bearer
Certificates as provided above, then such notification to Holders of Bearer
Certificates as shall be given with approval of the Trustee shall constitute
sufficient notice to such Holders for every purpose hereunder. Neither the
failure to give notice by publication to Holders of Bearer Certificates as
provided above, nor any defect in any notice so published, shall affect the
sufficiency of any notice mailed to Holders of Registered Certificates as
provided above.
Copies of all notices, reports, certificates and amendments delivered
hereunder shall be mailed to the Rating Agency as follows: ▇▇▇▇▇'▇ Investors
Service, Inc., ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ABS
Monitoring Department - 4th Floor, telecopy number (▇▇▇) ▇▇▇-▇▇▇▇, and Standard
& Poor's Ratings Services, ▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
ABS Credit Card, telecopy number (▇▇▇) ▇▇▇-▇▇▇▇).
96
Section 13.06 Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall for any
reason whatsoever be held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or rights of the Certificateholders thereof.
Section 13.07 Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 7.02, 7.05, 8.02 and 8.05, this
Agreement, including any Supplement, may not be assigned by a Transferor or the
Servicer, as the case may be, without the prior consent of Holders of Investor
Certificate, evidencing Undivided Interests aggregating more than 51% of the
Aggregate Invested Amount,
Section 13.08 Certificates Nonassessable and Fully Paid. It is the
intention of the parties to this Agreement that the Certificateholders (and the
Certificate owners) shall not be personally liable for obligations of the Trust,
that the Undivided Interests represented by the Certificates shall be
nonassessable for any losses or expenses of the Trust or for any reason
whatsoever, and that Certificates upon authentication thereof by the Trustee
pursuant to Section 6.02 are and shall be deemed fully paid.
Section 13.09 Further Assurances. The Transferors and the Servicer
agree to do and perform, from time to time, any and all acts and to execute any
and all further instruments required or reasonably requested by the Trustee more
fully to effect the purposes of this Agreement including, without limitation,
the execution of any financing statements or amendments thereto relating to the
property of the Trust for filing under the provisions of the UCC of the Relevant
UCC State.
Section 13.10 No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of the Trustee or the Investor
Certificateholders, any right, remedy, power or privilege hereunder, shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exhaustive of any rights, remedies, powers and privileges provided by law.
Section 13.11 Counterparts. This Agreement and any 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 together
shall constitute one and the same instrument.
Section 13.12 Third-Party Beneficiaries. This Agreement and any
Supplement will inure to the benefit of and be binding upon the parties hereto,
the Certificateholders and the Certificate Owners and their respective
successors and permitted assigns. Except as otherwise provided in this
Agreement, no other person will have any right or obligation hereunder provided,
however, that if so specified in the applicable Supplement, an Enhancement
Provider may be deemed to be a third party beneficiary of this Agreement.
97
Section 13.13 Actions by Certificateholders.
(a) Wherever in this Agreement or any Supplement a provision
is made that an action may be taken or a notice, demand or instruction given by
Investor Certificateholders, such action, notice or instruction may be taken or
given by any Investor Certificateholder of any Series, unless such provision
requires a specific percentage of Investor Certificateholders of a certain
Series or all Series.
(b) Any request, demand, authorization, direction, notice,
consent, waiver or other act by a Certificateholder shall bind such
Certificateholder and every subsequent holder of such Certificate issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done or omitted to be done by the Trustee or the Servicer
in reliance thereon, whether or not notation of such action is made upon such
Certificate.
Section 13.14 Merger and Integration. Except as specifically stated
otherwise herein, this Agreement sets forth the entire understanding of the
parties relating to the subject matter hereof, and all prior understandings,
written or oral, are superseded by this Agreement. This Agreement may hot be
modified, amended, waived or supplemented except as provided herein.
Section 13.15 Headings. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.
Section 13.16 Certificates and Opinions of Counsel.
(a) Any certificate delivered may be based, insofar as it
relates to legal matters, upon an Opinion of Counsel, unless the Person
delivering such certificate knows, or in the exercise of reasonable care should
know, that such opinion with respect to the matters upon which such certificate
may be based as aforesaid is erroneous. Any Opinion of Counsel or certificate
delivered hereunder may be based, insofar as it relates to factual matters, upon
a certificate or opinion of, or representations by, an officer or officers of
the Servicer or a Transferor, stating that the information with respect to such
factual matters is in the possession of such Person, unless the Person
delivering such certificate or such counsel knows, or in the exercise of
reasonable care should know, that such certificate opinion or representations
with respect to such matters are erroneous. Any Opinion of Counsel delivered
hereunder may contain necessary exceptions and qualifications.
(b) Any Opinion of Counsel or certificate delivered hereunder
may be based, insofar as it relates to accounting matters, upon a certificate or
opinion of or representations by an independent public accountant or firm of
accountants, unless such counsel or the Person delivering such certificate as
the case may be, knows that the certificate or opinions or representations with
respect to the accounting matters upon which the certificate or opinion may be
based as aforesaid are erroneous, or in the exercise of reasonable care should
know that the same are erroneous. Any certificate, opinion or representations of
any firm of independent public accountants filed with the Trustee shall contain
a statement that such firm is independent.
(c) Where any Person is required to make, give or execute two
or more applications, requests, consents, certificates, statements, opinions or
other instruments, hereunder, they may, but need not, be consolidated and form
one instrument.
98
Section 13.17 Effect of Amendment No. 3. Reference is made to Amendment
No. 3 to the Original Pooling Agreement, dated as of September 12, 1994. This
Agreement contains the amendments to the Original Pooling Agreement in effect
pursuant to such Amendment No. 3. Such Amendment No. 3 provides that Amendment
No. 3 shall be null and void and of no further force and effect on the date
specified by the Servicer in an Officer's Certificate delivered to the Trustee
stating that the Servicer has modified its computer programs such that from and
after such date no amounts billed to Cardmembers under the Privileged Assets
Program will be included in any calculation of Receivables balances. This
Agreement shall be deemed amended to delete all provisions hereof contained in
such Amendment No. 3 as of the date so specified by the Servicer.
[END OF ARTICLE ▇▇▇▇]
▇▇
IN WITNESS WHEREOF, the Transferors, the Servicer and the
Trustee have caused this Pooling and Servicing Agreement to be duly executed by
their respective officers as of the day and year first above written.
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION,
as Transferor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
AMERICAN EXPRESS CENTURION BANK,
as Transferor
By: /s/ L. ▇▇▇▇▇ ▇▇▇▇▇
-------------------------------------
Name: L. ▇▇▇▇▇ ▇▇▇▇▇
Title: President and Chief Operating Officer
AMERICAN EXPRESS BANK, FSB,
as Transferor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Title: President and Chief Operating Officer
AMERICAN EXPRESS TRAVEL RELATED
SERVICES COMPANY, INC.,
as Servicer
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Senior Vice President and Treasurer
THE BANK OF NEW YORK,
as Trustee and Paying Agent
By: /s/ ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-------------------------------------
Name: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Title: Assistant Vice President
100
SCHEDULE 1
LIST OF ACCOUNTS
Delivered to Trustee only
101
SCHEDULE 2
COLLECTION ACCOUNT
No:
Designation:
Where established:
SCHEDULE 3
ADMINISTRATIVE FEES AND CHARGES
The following administrative fees and charges assessed on the
Accounts are included within the definition of "Receivable".
[LIST TO COME FROM TRS]
EXHIBIT A TO THE
POOLING AND SERVICING AGREEMENT
EXCHANGEABLE TRANSFEROR
CERTIFICATE
THIS CERTIFICATE OR ANY INTEREST HEREIN MAY NOT BE TRANSFERRED, ASSIGNED,
EXCHANGED OR CONVEYED, EXCEPT IN ACCORDANCE WITH SECTIONS 6.03, 6.09 AND 7.02
OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
No. R-1 One Unit
AMERICAN EXPRESS MASTER TRUST
EXCHANGEABLE TRANSFEROR CERTIFICATE
This Certificate represents an interest in
the American Express Master Trust
Evidencing an undivided interest in a trust, the corpus of which
consists of receivables generated or to be generated in a portfolio of
designated charge Accounts.
(Not an interest in or recourse obligation of American Express
Receivables Financing Corporation, American Express Credit Corporation, American
Express Centurion Bank, American Express Bank, FSB, American Express Travel
Related Services Company, Inc. ("TRS"), American Express Company or any of their
affiliates)
This certifies that American Express Receivables Financing Corporation,
American Express Centurion Bank and American Express Bank, FSB are the
registered owners of an undivided interest in the American Express Master Trust
(the "Trust") issued pursuant to the Amended and Restated Master Pooling and
Servicing Agreement, dated as of April 16, 2004 (the "Pooling and Servicing
Agreement"; such term to include any Supplement thereto) by and among American
Express Receivables Financing Corporation, American Express Centurion Bank
("Centurion") and American Express Bank, FSB ("FSB"), as Transferors (the
"Transferors"), TRS, as Servicer (in such capacity, the "Servicer"), and The
Bank of New York, as Trustee (the "Trustee"). The corpus of the Trust consists
of all of the Transferors' right, title and interest in and to a portfolio of
receivables now existing and hereafter created (the "Receivables") arising under
certain charge accounts from time to time owned by TRS, Centurion and FSB and
identified in the Pooling and Servicing Agreement (collectively, the
"Accounts"), all monies due or to become due with respect thereto (including
Recoveries) on and after the Cut Off Date, all proceeds of such Receivables, all
right, title and interest of the Transferors in, to and under any Receivable
Purchase Agreement, all monies as are from time to time deposited in the
Collection Account and any other account or accounts maintained for the benefit
of the Certificateholders and all monies as are from time to time available
under any Enhancement for any Series for payment to Certificateholders. The
Receivables consist of Receivables which arise generally from the purchase of
merchandise and services, annual membership fees and other administrative fees
billed to obligors, as more fully specified in the Pooling and Servicing
Agreement, including Recoveries on Receivables in Defaulted Accounts.
A-1
Although a summary of certain provisions of the Pooling and Servicing
Agreement is set forth below, this Certificate does not purport to summarize the
Pooling and Servicing Agreement and reference is made to the Pooling and
Servicing Agreement for information with respect to the interests, rights,
benefits, obligations, proceeds, and duties evidenced hereby and the rights,
duties and obligations of the Trustee, A copy of the Pooling and Servicing
Agreement may be requested from the Trustee by writing to the Trustee at The
Bank of New York, ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇,
Attention: Corporate Trust Division. To the extent not defined herein
capitalized terms used herein have the meanings ascribed to them in the Pooling
and Servicing Agreement,
This Certificate is the Exchangeable Transferor Certificate, which
represents a fractional undivided interest in the Trust including the right to
receive the Collections and other amounts at the times and in the amounts
specified in the Pooling and Servicing Agreement to be paid to the holder of the
Exchangeable Transferor Certificate. This Certificate is issued under and is
subject to the terms, provisions and conditions of the Pooling and Servicing
Agreement, to which Pooling and Servicing Agreement, as amended from time to
time, the holder hereof by virtue of the acceptance hereof assents and by which
the holder hereof is bound.
The interest represented by this Exchangeable Transferor Certificate at
any time in the Receivables in the Trust shall not exceed the Transferor
Interest at such time. In addition to the Exchangeable Transferor Certificate,
Investor Certificates will be issued to investors pursuant to the Pooling and
Servicing Agreement, which will represent the interests of Investor
Certificateholders in the Trust. This Certificate shall not represent any
interest in the Collection Account or any other account or any Enhancement
except as specifically provided in the Pooling and Servicing Agreement.
The Transferors have entered into the Pooling and Servicing Agreement,
and this Certificate is issued, with the intention that, for Federal, state and
local income and franchise tax purposes, the Investor Certificates (other than
those held by the Transferors) will qualify as indebtedness secured by the
Receivables. The Transferors, by entering into the Pooling and Servicing
Agreement and by the acceptance of the Exchangeable Transferor Certificate,
agree to treat the Investor Certificates (other than those held by the
Transferors) for Federal, state and local income and franchise tax purposes as
indebtedness.
Subject to certain conditions in the Pooling and Servicing Agreement,
the obligations created by the Pooling and Servicing Agreement and the Trust
created thereby shall terminate upon the earlier of (i) July 15, 2092 and (ii)
the day after the date on which funds shall have been deposited in the
Collection Account sufficient to pay the Aggregate Invested Amount plus
applicable Certificate Interest accrued through the last day of the interest
accrual period for such Distribution Date in full on all Series of Investor
Certificates.
Upon the termination of the Trust pursuant to Article XII of the
Pooling and Servicing Agreement and the surrender of the Exchangeable Transferor
Certificate, the Trustee shall assign and convey to the Transferors (without
recourse, representation or warranty) all right, title and interest of the Trust
in the Receivables, whether then existing or thereafter created, and all
proceeds thereof except for amounts held by the Paying Agent and all other Trust
Property. The Trustee shall execute and deliver such instruments of transfer and
assignment in each case without recourse as shall be reasonably requested by the
Transferors to vest in the Transferors all right, title and interest which the
Trustee had in the applicable Receivables.
A-2
Unless the certificate of authentication hereon has been executed by or
on behalf of the Trustee, by manual signature, this Certificate shall not be
entitled to any benefit under the Pooling and Servicing Agreement, or be valid
for any purpose.
IN WITNESS WHEREOF, American Express Receivables Financing Corporation,
American Express Centurion Bank and American Express Bank, FSB have caused this
Exchangeable Transferor Certificate to be duly executed under their respective
official seals.
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION
By
----------------------------------------
Authorized Signatory
[SEAL]
AMERICAN EXPRESS CENTURION BANK
By
----------------------------------------
Authorized Signatory
[SEAL]
AMERICAN EXPRESS BANK, FSB
By
----------------------------------------
Authorized Signatory
[SEAL]
A-3
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is the Exchangeable Transferor Certificate referred to in
the within-mentioned Pooling and Servicing Agreement.
Dated: THE BANK OF NEW YORK
as Trustee
By
----------------------------------------
Authorized Signatory
A-4
EXHIBIT B
TO THE POOLING
AND SERVICING AGREEMENT
FORM OF ASSIGNMENT OF RECEIVABLES IN ADDITIONAL ACCOUNTS
(As required by Subsection 2.06(d)(ii) of the Master
Pooling and Servicing Agreement)
ASSIGNMENT No. __ OF RECEIVABLES IN ADDITIONAL ACCOUNTS, dated as of
__________, ____, from AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION, a
corporation organized under the laws of the State of Delaware, AMERICAN EXPRESS
CENTURION BANK, a Utah-chartered industrial loan corporation, and AMERICAN
EXPRESS BANK, FSB, a federally-chartered savings bank (collectively, the
"Transferors"), to The Bank of New York, a New York banking corporation (the
"Trustee") pursuant to the Pooling and Servicing Agreement referred to below.
WI T N E S S E T H:
WHEREAS, the Transferors, American Express Travel Related Services
Company, Inc., as Servicer, and the Trustee are parties to the Amended and
Restated Master Pooling and Servicing Agreement, dated as of April 16, 2004,
including any Supplement thereto (hereinafter as such agreement may have been,
or may from time to time be, amended, supplemented or otherwise modified, the
"Pooling and Servicing Agreement"); and
WHEREAS, pursuant to the Pooling and Servicing Agreement, the
Transferors wish to designate Additional Accounts to be included as Accounts and
to convey the Receivables of such Additional Accounts, whether now existing or
hereafter created, to the Trustee as part of the corpus of the Trust (as each
such term is defined in the Pooling and Servicing Agreement); and
WHEREAS, the Trustee is willing to accept such designation and
conveyance subject to the terms and conditions hereof;
NOW THEREFORE, the Transferors and the Trustee hereby agree as follows:
1. Defined Terms. Unless otherwise defined herein, capitalized terms
used herein shall have the meanings ascribed to them in the Pooling and
Servicing Agreement.
"Additional Account Closing Date" shall mean, with respect to the
Additional Accounts designated hereby, __________, ____.
"Additional Account Cut Off Date" shall mean, with respect to the
Additional Accounts designated hereby, __________, ____.
"Additional Account Selection Date" shall mean, with respect to the
Additional Accounts designated hereby __________.
B-1
2. Designation of Additional Accounts. The Servicer shall deliver to
the Trustee on or prior to the Additional Account Closing Date, a computer file
or microfiche list containing a true and complete list of all Accounts which as
of the Additional Account Closing Date shall be deemed to be Additional
Accounts, identified by account number and by the Receivables balance in such
accounts as of the close of business on the Additional Account Cut-Off Date.
Such list shall be marked as Schedule 1 to this Assignment and, as of the
Additional Account Closing Date, shall be incorporated into and made a part of
this Assignment and the Pooling and Servicing Agreement.
3. Conveyance of Receivables. (a) Each Transferor does hereby transfer,
assign, set-over and otherwise convey to the Trustee for the benefit of the
Certificateholders, without recourse, on and after the Additional Account
Closing Date, all right, title and interest of such Transferor in and to the
Receivables now existing and hereafter created in the Additional Accounts
designated on Schedule 1, all monies due or to become due on and after the
Additional Account Cut-Off Date and all amounts received with respect thereto,
including all Recoveries related thereto, and all proceeds thereof.
(b) In connection with such transfer, each Transferor agrees to record
and file, at its own expense, financing statements (and amendments thereto when
applicable) with respect to the Receivables now existing and hereafter created
in the Additional Accounts designated on Schedule 1 meeting the requirements of
Relevant UCC State law in such manner and such jurisdictions as are necessary to
perfect the assignment of such Receivables to the Trustee, and to deliver a
file-stamped copy of such financing statement, amendment or other evidence of
such filing (which may, for purposes of this Section 3, consist of telephone
confirmation of such filing, confirmed within 24 hours in writing) to the
Trustee on or prior to the Additional Account Closing Date.
(c) In connection with such transfer, each Transferor further agrees,
at its own expense, on or prior to the Additional Account Closing Date, to
indicate clearly and unambiguously in its computer files that Receivables
created in connection with the Additional Accounts designated hereby have been
transferred to the Trustee pursuant to this Assignment for the benefit of
Certificateholders by including in the securitization field of such computer
files the code "[__]" for each such Additional Account.
4. Acceptance by Trustee. Subject to the satisfaction of the conditions
set forth in Section 6 of this Assignment, the Trustee hereby acknowledges its
acceptance on behalf of the Trust of all right, title and interest previously
held by each Transferor in and to the Receivables now existing and hereafter
created, and declares that it shall maintain such right, title and interest,
upon the trust herein set forth, for the benefit of all Certificateholders and
any Enhancement Provider. The Trustee further acknowledges that, prior to or
simultaneously with the execution and delivery of this Assignment, each
Transferor delivered to the Trustee the computer file or microfiche list
described in Section 2 of this Assignment.
5. Representations and Warranties of Each Transferor. Each Transferor
hereby represents and warrants to the Trust as of the Additional Account Closing
Date that:
B-2
(a) Legal, Valid and Binding obligation. This Assignment constitutes a
legal, valid and binding obligation of such Transferor, enforceable against such
Transferor in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect affecting the enforcement of
creditors' rights in general and except as such enforceability may be limited by
general principles of equity (whether considered in a suit at law or in equity).
(b) Eligibility of Accounts. Each Additional Account designated hereby
as of the Additional Account Selection Date is an Eligible Account.
(c) Selection Procedures. No selection procedures believed by such
Transferor to be materially adverse to the interests of any Series of Investor
Certificates or any Enhancement Provider were utilized in selecting the
Additional Accounts designated hereby from the available Eligible Accounts in
such Transferor's portfolio of charge card accounts.
(d) Insolvency. Such Transferor is not insolvent and, after giving
effect to the conveyance set forth in Section 3 of this Assignment, will not be
insolvent.
(e) Security Interest. This Assignment constitutes either (i) a valid
transfer and assignment to the Trust of all right, title and interest of such
Transferor in and to Receivables now existing and hereafter created in
Additional Accounts designated on Schedule 1 hereto, all monies due or to become
due with respect thereto on and after the Additional Account Cut Off Date,
Recoveries and all proceeds of all Receivables to the extent set forth in the
UCC in effect in the Relevant UCC State of such Receivables, and such
Receivables and all proceeds thereof will be conveyed to the Trust free and
clear of any Lien of any Person claiming through or under the Transferor or any
of its Affiliates except for (x) Liens permitted under subsection 2.05(b),of the
Pooling and Servicing Agreement, (y) the interest of the holder of the
Exchangeable Transferor Certificate and (z) any right of the holder of the
Exchangeable Transferor Certificate to receive interest accruing on, and
investment earnings with respect to, the Collection Account and any other
account or accounts maintained for the benefit of Certificateholders as provided
in the Pooling and Servicing Agreement and any Supplement; or (ii) a grant of a
security interest (as defined in the UCC as in effect in the Relevant UCC State)
in such property to the Trustee on behalf of the Trust, which is enforceable
with respect to the existing Receivables of the Additional Accounts designated
on Schedule 1 hereto, and the proceeds (as defined in the UCC as in effect in
the Relevant UCC State) thereof to the extent set forth in the UCC as in effect
in the Relevant UCC upon the conveyance of such Receivables to the Trust, and
which will be enforceable with respect to the Receivables thereafter created in
respect of Additional Accounts designated on Schedule 1 hereto and the proceeds
(to the extent set forth in the UCC as in effect in the Relevant UCC State)
thereof upon such creation; and (iii) if this Assignment constitutes the grant
of a security interest to the Trust in such property, upon the filing of
financing statements described in Section 3 of this Assignment with respect to
the Additional Accounts designated hereby and in the case of the Receivables of
such Additional Accounts thereafter created and the proceeds (to the extent set
forth in the UCC as in effect in the Relevant UCC State) thereof upon such
creation, the Trust shall have a first priority perfected security interest in
such property to the extent set forth in the UCC as in effect in the Relevant
UCC, with respect to proceeds, except for Liens permitted under subsection
2.05(b) of the Pooling and Servicing Agreement.
B-3
6. Conditions Precedent. The acceptance of the Trustee set forth in
Section 4 and the amendment of the Pooling and Servicing Agreement set forth in
Section 7 are subject to the satisfaction, on or prior to the Additional Account
Closing Date, of the following conditions precedent:
(a) Officer's Certificate. Each Transferor shall have delivered to the
Trustee an Officer's Certificate dated as of the Additional Account Closing
Date, certifying that (i) all requirements set forth in Section 2.06 of the
Pooling and Servicing Agreement for designating Additional Accounts and
conveying the Receivables of such Accounts, whether now existing or hereafter
created, have been satisfied and (ii) each of the representations and warranties
made by such Transferor in Section 5 is true and correct as of the Additional
Account Closing Date, The Trustee may conclusively rely on such Officer's
Certificate, shall have no duty to make inquiries with regard to the matters set
forth therein, and shall incur no liability in so relying.
(b) Opinion of Counsel. Each Transferor shall have delivered to the
Trustee and each Rating Agency an Opinion of Counsel with respect to the
Receivables in the Additional Accounts designated hereby substantially in the
form of Part One of Exhibit G to the Pooling and Servicing Agreement.
7. Amendment of the Pooling and Servicing Agreement. The Pooling and
Servicing Agreement is hereby amended to provide that all references therein to
the "Pooling and Servicing Agreement," to "this Agreement" and "herein" shall be
deemed from and after the Additional Account Closing Date to be a dual reference
to the Pooling and Servicing Agreement as supplemented by this Assignment.
Except as expressly amended hereby, all of the representations, warranties,
terms, covenants and conditions of the Pooling and Servicing Agreement shall
remain unamended and shall continue to be, and shall remain, in full force and
effect in accordance with its terms and except as expressly provided herein
shall not constitute or be deemed to constitute a waiver of compliance with or a
consent to non-compliance with any term or provision of the Pooling and
Servicing Agreement,
8. Counterparts. This Assignment 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 together shall constitute one and the
same instrument.
9. GOVERNING LAW. THIS ASSIGNMENT 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.
B-4
IN WITNESS WHEREOF, the undersigned have caused this
Assignment of Receivables in Additional Accounts to be duly executed and
delivered by their respective duly authorized officers on the day and year first
above written.
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION,
as Transferor of the
Additional Accounts
By
-------------------------------------
Name:
Title:
AMERICAN EXPRESS CENTURION BANK,
as Transferor of the
Additional Accounts
By
-------------------------------------
Name:
Title:
AMERICAN EXPRESS BANK, FSB,
as Transferor of the
Additional Accounts
By
-------------------------------------
Name:
Title:
THE BANK OF NEW YORK
as Trustee and Paying Agent
By
-------------------------------------
Name:
Title:
Acknowledged:
AMERICAN EXPRESS TRAVEL RELATED
SERVICES COMPANY, INC.
By
-----------------------------
Name:
Title:
B-5
Schedule 1
to Assignment of
Receivables in
Additional Accounts
ADDITIONAL ACCOUNTS
B-6
EXHIBIT C
TO THE POOLING
AND SERVICING AGREEMENT
FORM OF REASSIGNMENT OF RECEIVABLES
(As required by Section 2.07(c)(i) of the
Pooling and Servicing Agreement)
REASSIGNMENT No. OF RECEIVABLES, dated as of __________, ____, between
AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION, a corporation organized
under the laws of the State of Delaware, american express centurion bank, a
Utah-chartered industrial loan corporation, and american express bank, fsb, a
federally-chartered savings bank (collectively, the "Transferors"), and The Bank
of New York, a New York banking corporation (the "Trustee") pursuant to the
Pooling and Servicing Agreement referred to below.
W I T N E S S E T H:
WHEREAS, the Transferors, American Express Travel Related Services
Company, Inc., as servicer, and the Trustee are parties to the Amended and
Restated Master Pooling and Servicing Agreement, dated as of April 16, 2004,
including any Supplement (hereinafter as such agreement may have been, or may
from time to time be, amended, supplemented or otherwise modified, the "Pooling
and Servicing Agreement"); and
WHEREAS, pursuant to the Pooling and Servicing Agreement, the
Transferors wish to remove from the Trust all Receivables from certain
designated Accounts (the "Removed Accounts") and to cause the Trustee to
reconvey the Receivables of such Removed Accounts, whether now existing or
hereafter created, to the Transferors (as each such term is defined in the
Pooling and Servicing Agreement); and
WHEREAS, the Trustee is willing to accept such designation and to
reconvey the Receivables in the Removed Accounts subject to the terms and
conditions hereof;
NOW THEREFORE, the Transferors and the Trustee hereby agree as follows:
1. Defined Terms. Unless otherwise defined herein, capitalized terms
used herein shall have the meanings ascribed to them in the Pooling and
Servicing Agreement.
"Removal Date" shall mean, with respect to the Removed Accounts
designated hereby, __________, ____.
"Removal Notice Date" shall mean, with respect to the Removed Accounts
designated hereby, __________, ____ (which shall be a date on or prior to the
tenth Business Day prior to the Removal Date).
C-1
2. Designation of Removed Accounts. Each Transferor shall deliver to
the Trustee herewith, a computer file or microfiche list containing a true and
complete list of each Account which as of the Removal Date shall be deemed to be
a Removed Account, such Accounts being identified by account number and by the
aggregate balance of the Receivables in all such Removed Accounts as of the
Removal Notice Date. Such list shall be marked as Schedule 1 to this
Reassignment and shall be incorporated into and made a part of this Reassignment
and the Pooling and Servicing Agreement as of the Removal Date.
3. Conveyance of Receivables. (a) The Trustee does hereby transfer,
assign, set over and otherwise convey to the Transferors, without recourse or
representation (included those implied by law) on and after the Removal Date,
all right, title and interest of the Trustee in and to the Receivables now
existing and hereafter created in the Removed Accounts designated on Schedule 1
hereto, all monies due or to become due and all amounts received with respect
thereto, including all Recoveries related thereto, and all proceeds thereof.
(b) In connection with such transfer, the Trustee agrees to execute and
deliver to each Transferor on or prior to the date of this Reassignment, a
termination statement with respect to the Receivables now existing and hereafter
created in the Removed Accounts designated hereby (which may be a single
termination statement with respect to all such Receivables) evidencing the
release by the Trustee of its lien on the Receivables in the Removed Accounts,
and meeting the requirements of applicable state law, in such manner and such
jurisdictions as are necessary to remove such lien. Each Transferor shall be
responsible for filing any such termination statement and the Trustee shall have
no responsibility to see to any recording or filing of any such termination
statement.
4. Acceptance by Trustee. The Trustee hereby acknowledges that, prior
to or simultaneously with the execution and delivery of this Reassignment, each
Transferor delivered to the Trustee the computer file or microfiche list
represented by such Transferor to be as described in Section 2 of this
Reassignment.
5. Representations and warranties of the Transferor. Each Transferor
hereby represents and warrants to the Trustee as of the Removal Date:
(a) Valid and Legally Binding Obligation. This Reassignment constitutes
a valid and legally binding obligation of such Transferor enforceable against
such Transferor in accordance with its terms, subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
affecting the enforcement of creditors' rights in general and except as such
enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity); and
(b) Selection Procedures. No selection procedures believed by such
Transferor to be materially adverse to the interests of any outstanding Series
of Investor Certificates or any Enhancement Provider were utilized in selecting
the Removed Accounts designated hereby.
C-2
6. Conditions Precedent. The amendment of the Pooling and Servicing
Agreement set forth in Section 7 hereof is subject to the satisfaction, on or
prior to the Removal Date, of the following condition precedent:
(a) Officer's Certificate. Each Transferor shall have delivered to the
Trustee and the Rating Agencies an Officer's Certificate certifying that (i) on
the Removal Date, all requirements set forth in Section 2.07 of the Pooling and
Servicing Agreement for designating Removed Accounts and reconveying the
Receivables of such Removed Accounts, whether now existing or hereafter created,
have been satisfied, and (ii) each of the representations and warranties made by
such Transferor in Section 5 hereof is true and correct as of the Removal Date,
The Trustee may conclusively rely on such Officer's Certificate, shall have no
duty to make inquiries with regard to the matters set forth therein and shall
incur no liability in so relying.
7. Amendment of the Pooling and Servicing Agreement. The Pooling and
Servicing Agreement is hereby amended to provide that all references therein to
the "Pooling and Servicing Agreement," to "this Agreement" and "herein" shall be
deemed from and after the Removal Date to be a dual reference to the Pooling and
Servicing Agreement as supplemented by this Reassignment, Except as expressly
amended hereby, all of the representations, warranties, terms, covenants and
conditions of the Pooling and Servicing Agreement shall remain unamended and
shall continue to be, and shall remain, in full force and effect in accordance
with its terms and except as expressly provided herein shall not constitute or
be deemed to constitute a waiver of compliance with or a consent to
non-compliance with any term or provision of the Pooling and Servicing
Agreement.
8. Counterparts. This Reassignment 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 together shall constitute one and the
same instrument.
9. GOVERNING LAW. THIS REASSIGNMENT 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.
C-3
IN WITNESS WHEREOF, the undersigned have caused this Reassignment of
Receivables to be duly executed and delivered by their respective duly
authorized officers on the day and year first above written.
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION,
as Transferor of the Receivables in the
Removed Accounts
By
-------------------------------------------
Name:
Title:
AMERICAN EXPRESS CENTURION BANK,
as Transferor of the Receivables in the
Removed Accounts
By
-------------------------------------------
Name:
Title:
AMERICAN EXPRESS BANK, FSB,
as Transferor of the Receivables in the
Removed Accounts
By
-------------------------------------------
Name:
Title:
THE BANK OF NEW YORK
as Trustee and Paying Agent
By
-------------------------------------------
Name:
Title:
C-4
Schedule 1
to Reassignment
of Receivables
REMOVED ACCOUNTS
C-5
EXHIBIT D TO THE
POOLING AND
SERVICING AGREEMENT
FORM OF INITIAL SERVICER'S REPORT
AMERICAN EXPRESS TRAVEL
RELATED SERVICES COMPANY, INC.
-----------------------------
AMERICAN EXPRESS MASTER TRUST
-----------------------------
The undersigned, duly authorized representative of American Express
Travel Related Services Company, Inc, ("TRS") as Servicer pursuant to the
Amended and Restated Master Pooling and Servicing Agreement, dated as of April
16, 2004 (the "Pooling and Servicing Agreement"), by and among TRS, as Servicer,
American Express Receivables Financing Corporation, American Express Centurion
Bank, and American Express Bank, FSB, as Transferors, and The Bank of New York,
as trustee (the "Trustee"), does hereby certify to the best of his or her
knowledge after reasonable investigation that:
1. TRS is as of the date hereof the Servicer under the Pooling and
Servicing Agreement. Capitalized terms used in this Certificate have their
respective meanings set forth in the Pooling and Servicing Agreement.
2. The undersigned is duly authorized pursuant to the Pooling and
Servicing Agreement to execute and deliver this certificate to the Trustee.
3. This certificate is delivered pursuant to Section 3.04(a) of the
Pooling and Servicing Agreement.
4. The Trust Principal Component as of the end of the day two Business
Days preceding the Closing Date was $[ ].
D-1
IN WITNESS WHEREOF, the undersigned, a duly authorized officer of the
Servicer, has duly executed this Certificate this [ ] day of [ ].
AMERICAN EXPRESS TRAVEL RELATED
SERVICES COMPANY, INC. as Servicer
By
--------------------------------------
Name:
Title:
D-2
EXHIBIT F
FORM OF ANNUAL SERVICER'S CERTIFICATE
AMERICAN EXPRESS TRAVEL
RELATED SERVICES COMPANY, INC.
-----------------------------
AMERICAN EXPRESS MASTER TRUST
-----------------------------
The undersigned, duly authorized representative of American Express
Travel Related Services Company, Inc. ("TRS") as Servicer pursuant to the
Amended and Restated Master Pooling and Servicing Agreement dated as of April
16, 2004 (the "Pooling and Servicing Agreement"), by and among TRS, as Servicer,
American Express Receivables Financing Corporation, American Express Centurion
Bank and American Express Bank, FSB, as Transferors, and The Bank of New York,
as trustee (the "Trustee"), does hereby certify to the best of his or her
knowledge after reasonable investigation that:
1. TRS is as of the date hereof the Servicer under the Pooling and
Servicing Agreement, Capitalized terms used in this Certificate have their
respective meanings set forth in the Pooling and Servicing Agreement.
2. The undersigned is duly authorized pursuant to the Pooling and
Servicing Agreement to execute and deliver this certificate to the Trustee.
3. This certificate is delivered pursuant to Section 3.05 of the
Pooling and Servicing Agreement.
4. A review of the activities of the Servicer during the calendar year
ended December 31, ____ and of its performance under the Pooling and Servicing
Agreement was conducted under my supervision.
5. Based on such review, to the best of the undersigned's knowledge the
Servicer has fully performed all its obligations under the Pooling and Servicing
Agreement throughout such calendar year and no event which, with the giving of
notice or passage of time or both, would constitute a Servicer Default has
occurred or is continuing except as set forth in paragraph 6 below.
6. The following is a description of each Servicer Default in the
performance of the Servicer's obligations or Early Amortization Event under the
provisions of the Pooling and Servicing Agreement known to me to have been made
during the calendar year ended December 31, __, which sets forth in detail the
(i) nature of each such Servicer Default or Early Amortization Event, (ii) the
action taken by the Servicer, if any, to remedy each such Servicer Default or
Early Amortization Event and (iii) the current status of each such default: [If
applicable, insert "None."]
F-1
IN WITNESS WHEREOF, the undersigned, a duly authorized officer of the
Servicer, has duly executed this Certificate this __ day of ________, __.
By
------------------------------------
Name:
Title:
F-2
EXHIBIT G TO
POOLING
AND SERVICING
AGREEMENT
PART ONE
PROVISIONS TO BE INCLUDED IN
OPINION OF COUNSEL TO BE
DELIVERED PURSUANT TO
SUBSECTION 2.06(d)(vi) OF THE
POOLING AND SERVICING AGREEMENT
The opinions set forth below may be subject to certain qualifications,
assumptions, limitations and exceptions taken or made in the opinion of the
relevant Transferor's counsel with respect to similar matters delivered on the
Closing Date. Such counsel may rely as to factual matters on certificates of
officers of each Transferor and the Servicer.
(i) The Assignment has been duly authorized, executed and delivered by
the relevant Transferor and constitutes the valid and legally binding agreement
of the relevant Transferor, enforceable against such Transferor in accordance
with its terms subject to bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and similar laws of general applicability relating to
or affecting creditor's rights and to general equity principles.
(ii) The provisions of the Pooling and Servicing Agreement are
effective to create, in favor of the Trustee for the benefit of the Holders of
the Certificates, a valid security interest in the Receivables and the
identifiable proceeds thereof. Such security interest constitutes a first
priority perfected security interest in such Receivables and the identifiable
proceeds thereof. No other security interest of any creditor of the relevant
Transferor is equal or prior to the security interest of the Trustee in such
Receivables.
(iii) No filing or other action, other than the filing of a Uniform
Commercial Code financing statement in the recording offices in the Relevant UCC
State is necessary to perfect or maintain the security interest in the
Receivables and the identifiable proceeds thereof, except that (a) appropriate
Uniform Commercial Code continuation statements must be filed within the period
of six months prior to the expiration of five years from the date of the
original filing, (b) if the relevant Transferor changes its name, identity or
corporate structure, appropriate Uniform Commercial Code financing statements
must be filed prior to the expiration of four months after the Transferor
changes its name, identity or corporate structure and (c) if the Transferor
changes its chief executive office or principal place of business to a
jurisdiction other than the State of New York, such security interest must be
perfected in such jurisdiction within four months of the date on which the
change occurs (or earlier, if perfection under the laws of such jurisdiction
would have otherwise ceased as set forth in clause (a) above).
G-1
PART TWO
PROVISIONS TO BE INCLUDED IN
OPINION OF COUNSEL PURSUANT
TO SUBSECTION 13.01(g)
The counsel rendering this opinion may rely on certificates of officers
of the Servicer as regards factual matters.
(i) The Amendment to the Pooling and Servicing Agreement, attached
hereto as Exhibit A (the "Amendment"), has been duly authorized, executed and
delivered by each Transferor and constitutes the valid and legally binding
agreement of each Transferor, enforceable in accordance with its terms subject
to bankruptcy, insolvency, fraudulent transfer, reorganization moratorium and
similar laws of general applicability relating to or affecting creditor's rights
and to general equity principles.
(ii) The Amendment has been entered into in accordance with the terms
and provisions of Section 13.01 of the Pooling and Servicing Agreement.
[(iii) The Amendment will not materially and adversely affect the
interests of the Investor Certificateholders.]
G-2
EXHIBIT H TO POOLING
AND SERVICING AGREEMENT
PROVISIONS TO BE INCLUDED
IN ANNUAL OPINION OF COUNSEL
The opinion set forth below, which is to be delivered pursuant to
subsection 13.02(d)(ii) of the Pooling and Servicing Agreement, may be subject
to certain qualifications, assumptions, limitations and exceptions taken or made
in the opinion of counsel delivered on the Closing Date with respect to similar
matters.
No filing or other action, other than such filing or action described
in such opinion, is necessary from the date of such opinion through March 1 of
the following year to continue the perfected status of the interest of the Trust
in the collateral described in the financing statements referred to in such
opinion.
H-1
EXHIBIT K TO POOLING
AND SERVICING AGREEMENT
__________ __, ____
[NAME AND ADDRESS OF LOCK-BOX BANK]
Ladies and Gentlemen:
We refer to account no._______________ (the "Account") that American
Express Travel Related Services Company, Inc. ("TRS") has established with you.
TRS has transferred exclusive dominion and control of its rights in the
Account to The Bank of New York as trustee (herein, together with its successors
and assigns, called the "Trustee") under the Amended and Restated Master Pooling
and Servicing Agreement dated as of April 16, 2004 among the Trustee, TRS, as
Servicer, and American Express Receivables Financing Corporation, American
Express Centurion Bank and American Express Bank, FSB, as Transferors, effective
when the Trustee shall have given you written notice of its election to assume
such dominion and control, which notice be substantially in the form attached
hereto as Annex A. Upon receipt of such notice, you shall be entitled to rely on
(and to assume) the authority of any purported employee of the Trustee and are
hereby authorized to act on any notice purportedly executed on behalf of the
Trustee.
By executing this letter agreement, you acknowledge the existence of
the Trustee's right, to the exclusion of TRS, to dominion and control over the
contents of the Account upon the Trustee's delivery to you of the aforementioned
notice, and agree that, from and after the date of receipt of such notice, you
shall change the name of the Account to The Bank of New York, as Trustee of
American Express Master Trust, and you shall maintain the Account and all money,
documents instruments and other items from time to time therein (and you shall
designate the Account on your records as being held) for the benefit and subject
to the interests of the Trustee and all correspondence concerning the Account
shall be sent to the Trustee (with a copy to TRS).
TRS will continue to pay all fees and other assessments due under the
Account at all times,
TRS hereby irrevocably instructs you, at all times from and after the
date of your receipt of written notice from the Trustee as described above,
until receipt of contrary instructions from the Trustee, to hold all moneys,
documents instruments and other items delivered to the Account for the benefit
of the Trustee and upon the direction of the Trustee to transfer and withdraw
funds from the Account as you may be instructed by TRS, on behalf of the
Trustee, until such time as the Trustee notifies you otherwise and provides
other instructions.
By executing this letter agreement, you waive and agree not to assert,
claim or endeavor to exercise, and bar and estop yourself from asserting,
claiming or exercising, until your receipt of written notice from the Trustee
that this letter agreement is terminated, any right of set-off, banker's lien or
other purported form of claim with respect to the items deposited into the
Account, or any funds from time to time in such Account or in transit thereto,
except that you may debit any such Account for any items erroneously deposited
therein and for items deposited therein that are returned or otherwise not
collected and for all charges, fees, commissions and expenses incurred by you in
providing services relating to or otherwise connected with the Account
arrangements, all in accordance with your customary practices for the chargeback
of returned items and expenses.
This letter agreement may not be terminated or amended without the
prior written consent of the Trustee. This letter agreement will be governed by
and construed in accordance with the laws of the State of New York. This letter
agreement may be executed in counterparts.
All notices to the Trustee should be addressed as follows until you
receive written notice from the Trustee to the contrary:
The Bank of New York
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Attention:
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Telephone No.:
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Fax No.:
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Please acknowledge your agreement to the terms set forth in this letter
agreement by signing two (2) copies of this letter agreement in the space
provided below and returning such copies to us.
Very truly yours,
AMERICAN EXPRESS TRAVEL
RELATED SERVICES COMPANY, INC.
By:
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Title:
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TO: American Express Travel
Related Services Company, Inc.
The Bank of New York
The undersigned hereby acknowledges and agrees to the foregoing letter
agreement as of the __ day of _________________, ______.
[NAME OF LOCK-BOX BANK]
By:
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Title:
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K-2
Annex A
[Letterhead of The Bank of New York]
[NAME AND ADDRESS OF LOCK-BOX BANK]
Re: American Express Travel
Related Services Company, Inc.
Account at [NAME OF LOCK-BOX BANK]
Ladies and Gentlemen:
Reference is made to the letter agreement dated as of __________, ____
(as amended, supplemented, amended and restated or otherwise modified from time
to time, the "Lock-Box Letter") between you and American Express Travel Related
Services Company, Inc., concerning account no. __________ (the "Account"). We
hereby give you notice of our assumption of exclusive dominion and control over
the contents of the Account as provided in the Lock-Box Letter and hereby
instruct you to change the name of the Account to "The Bank of New York, as
Trustee of American Express Master Trust."
[You are hereby specifically authorized to continue to take
instructions regarding the transfer and withdrawal of funds from the Account as
you may be instructed by TRS, until such time as we notify you otherwise.]
or
[You are hereby specifically instructed that we are revoking TRS' right
to give instructions with respect to the Account and that hereafter you shall
only accept and act in accordance with instructions from us.]
Very truly yours,
THE BANK OF NEW YORK, as
Trustee
By:
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Title:
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K-3