EXECUTION COPY
AMENDMENT NO. 1
TO THE
SECOND AMENDED AND RESTATED
BANK RECEIVABLES PURCHASE AGREEMENT
THIS AMENDMENT NO. 1 TO THE SECOND AMENDED AND RESTATED BANK RECEIVABLES
PURCHASE AGREEMENT, dated as of June 14, 2002 (this "Amendment No. 1") is by and
between METRIS COMPANIES INC., as buyer (the "Buyer"), and DIRECT MERCHANTS
CREDIT CARD BANK, NATIONAL ASSOCIATION, as seller (the "Seller").
WHEREAS the Buyer and the Seller have executed that certain Second Amended
and Restated Bank Receivables Purchase Agreement, dated as of January 22, 2002
(the "Receivables Purchase Agreement");
WHEREAS the Buyer and the Seller wish to amend the Receivables Purchase
Agreement as provided herein;
NOW THEREFORE, in consideration of the premises and the agreements
contained herein, the parties hereto agree to amend the provisions of the
Receivables Purchase Agreement as follows:
SECTION 1. Amendment of Section 1.1. (a) Section 1.1 of the Receivables
Purchase Agreement shall be and hereby is amended by adding the following
definitions, which in each case shall read in its entirety as follows:
"Determination Date" shall have the meaning set forth
in the Pooling and Servicing Agreement.
"Interchange" shall mean all interchange fees arising
on and after May 1, 2002 payable to the Seller, in its capacity as
credit card issuer, through VISA USA, Inc., MasterCard International,
Incorporated, or any other similar entity in connection with cardholder
charges for goods or services arising in all VISA USA, Inc. and
MasterCard International, Incorporated accounts owned by the Seller,
the amount of which allocable to the Receivables on any day shall be
calculated as provided in subsection 5.1(h).
(b) Section 1.1 of the Receivables Purchase Agreement shall be and hereby
is amended by deleting the definition of "Receivable" in its entirety an by
inserting in its place the following definition, which shall read in its
entirety as follows:
"Receivable" shall mean all amounts shown on the
Seller's records as amounts payable by Obligors on any Account from
time to time, including the right to receive payment of any interest or
finance charges and other obligations of such Obligor with respect
thereto. Each Receivable includes, without limitation, all rights of
the Seller under the applicable Contract. A Receivable shall be deemed
to have been created at the end of the day on the Date of Processing of
such Receivable.
SECTION 2. Amendment of Section 2.1. (a) Section 2.1 of the Receivables
Purchase Agreement shall be and hereby is amended by deleting subsection 2.1(a)
in its entirety and by inserting in its place the following:
(a) In consideration for the Purchase Price and upon
the terms and subject to the conditions set forth herein, the Seller
does hereby sell, assign, transfer, set-over and otherwise convey to
the Buyer, and the Buyer does hereby purchase from the Seller, without
recourse except as specifically set forth herein, all of the Seller's
right, title and interest in, to and under (i) the Receivables now
existing and hereafter created and arising in connection with the
Accounts, including all Additional Accounts, (ii) all Interchange
allocable to such Receivables, (iii) all monies and investments due or
to become due with respect thereto, and (iv) all Collections with
respect to, and all proceeds of, all of the foregoing. The foregoing
sale, transfer, assignment, set-over and conveyance does not constitute
and is not intended to result in a creation or an assumption by the
Buyer of any obligation of the Seller in connection with the Accounts
or any agreement or instrument relating thereto, including, without
limitation, any obligation to any Obligors, merchant banks, merchant
clearance systems, VISA USA, Inc., MasterCard International,
Incorporated or insurers.
(b) Section 2.1 of the Receivables Purchase Agreement shall be and hereby
is further amended by deleting the third sentence of subsection 2.1(d) in its
entirety and by inserting in its place the following:
However, in the event that, notwithstanding the intent of the parties,
the Receivables or other property are held to continue to be property
of the Seller, then (i) this Agreement also shall be deemed to be and
hereby is a security agreement within the meaning of the UCC, and (ii)
the conveyance by the Seller provided for in this Agreement shall be
deemed to be and the Seller hereby grants to the Buyer a security
interest in all of the Seller's right, title and interest in, to and
under (w) all Receivables now existing and hereafter created and
arising in connection with the Accounts, including all Additional
Accounts, (x) all Interchange allocable to such Receivables, (y) all
monies and investments due or to become due with respect to all of the
foregoing, and (z) all Collections with respect to, and all proceeds
of, all of the foregoing, to secure (1) the obligations of the Seller
and (2) a loan to the Seller in the amount of the Purchase Price as set
forth in this Agreement.
SECTION 3. Amendment of Section 3.1. Section 3.1 of the Receivables
Purchase Agreement shall be and hereby is amended by deleting subsection 3.1(a)
in its entirety and by inserting in its place the following:
(a) The Purchase Price for the Receivables and
related property conveyed to the Buyer under this Agreement shall be a
dollar amount equal to the aggregate amount of all Principal
Receivables, and of all Finance Charge Receivables as constitute fees
and charges relating to the debt waiver programs administered by the
Seller, so sold, subject to adjustment to reflect such factors as the
Buyer and the Seller mutually agree will result in a Purchase Price
determined to equal the fair market value of such Receivables and
related property.
SECTION 4. Amendment of Section 5.1. Section 5.1 of the Receivables
Purchase Agreement shall be and hereby is amended by adding the following at the
end of Section 5.1, immediately after subsection 5.1(g), which shall read in its
entirety as follows:
(h) On or prior to each Determination Date, the
Seller shall pay to the Buyer or its designee, in immediately available
funds, the amount of Interchange allocable to the Receivables with
respect to the preceding Monthly Period. Such amount of Interchange
shall be equal to the product of (a) the total amount of Interchange
paid to the Seller during the preceding Monthly Period and (b) a
fraction the numerator of which is the aggregate amount of cardholder
charges for goods and services in the Accounts with respect to such
Monthly Period and the denominator of which is the aggregate amount of
cardholder charges for goods and services in all VISA USA, Inc. and
MasterCard International, Incorporated accounts owned by the Seller
with respect to such Monthly Period.
SECTION 5. Amendment of Section 6.1. Section 6.1 of the Receivables
Purchase Agreement shall be and hereby is amended by deleting the second
sentence thereof in its entirety, and inserted in its place shall be the
following:
Upon such payment, without further action, such Ineligible Receivable,
together with all Interchange allocable to such Ineligible Receivable,
shall be reassigned to the Seller.
SECTION 6. Effectiveness. The amendments provided for by this Amendment No.
1 shall become effective upon the occurrence of the following:
(a) Receipt by the Buyer and the Seller of written confirmation from each
Rating Agency to the effect that the terms of this Amendment No. 1 will not
result in a reduction or withdrawal of the rating of any outstanding securities
issued by the Trust to which it is a Rating Agency.
(b) Counterparts of this Amendment No. 1, duly executed by the parties
hereto.
SECTION 7. Receivables Purchase Agreement in Full Force and Effect as
Amended. Except as specifically amended or waived hereby, all of the terms and
conditions of the Receivables Purchase Agreement shall remain in full force and
effect. All references to the Receivables Purchase Agreement in any other
document or instrument shall be deemed to mean such Receivables Purchase
Agreement as amended by this Amendment No. 1. This Amendment No. 1 shall not
constitute a novation of the Receivables Purchase Agreement, but shall
constitute an amendment thereof. The parties hereto agree to be bound by the
terms and obligations of the Receivables Purchase Agreement, as amended by this
Amendment No. 1, as though the terms and obligations of the Receivables Purchase
Agreement were set forth herein.
SECTION 8. Counterparts. This Amendment No. 1 may be executed in any number
of counterparts and by separate parties hereto on separate counterparts, each of
which when executed shall be deemed an original, but all such counterparts taken
together shall constitute one and the same instrument.
SECTION 9. Governing Law. THIS AMENDMENT NO. 1 SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF MINNESOTA, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 10. Defined Terms and Section References. Capitalized terms used
herein and not otherwise defined shall have the meanings assigned to such terms
in the Receivables Purchase Agreement. All Section or subsection references
herein shall mean Sections or subsections of the Receivables Purchase Agreement,
except as otherwise provided herein.
[Signature Page Follows]
IN WITNESS WHEREOF, the Buyer and the Seller each have caused this
Amendment No. 1 to be duly executed by their respective officers as of the day
and year first above written.
DIRECT MERCHANTS CREDIT CARD BANK,
NATIONAL ASSOCIATION,
as Seller
By: /s/ ▇▇▇▇▇ ▇. Than
Name:▇▇▇▇▇ ▇. Than
Title:Sr. Vice President, Treasurer and
Cashier
METRIS COMPANIES INC.,
as Buyer
By: /s/ ▇▇▇▇▇ ▇. Than
Name:▇▇▇▇▇ ▇. Than
Title:Sr. Vice President, Treasurer
Acknowledged and Accepted:
U.S. BANK NATIONAL ASSOCIATION,
as Trustee
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Name:▇▇▇▇▇▇▇ ▇.▇▇▇▇▇
Title: Assistant Vice President
