Exhibit 3.1
AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT
OF
WFN CREDIT COMPANY, LLC
This Amended and Restated Limited Liability Company Agreement (together
with the schedules attached hereto, this "AGREEMENT") of WFN Credit Company, LLC
(the "COMPANY"), is entered into by World Financial Network National Bank, as
the sole equity member (the "ECONOMIC MEMBER"), and ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ and
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, as the Special Members (as defined on Schedule A hereto).
Capitalized terms used and not otherwise defined herein have the meanings set
forth on SCHEDULE A hereto.
The Economic Member, by execution of the Limited Liability Company
Agreement of WFN Credit Company, LLC, dated as of May 1, 2001 (the "EXISTING
LLC AGREEMENT") and filing of the Certificate of Formation, formed the
Company as a limited liability company pursuant to and in accordance with the
Delaware Limited Liability Company Act (6 DEL. C. Section 18-101 ET SEQ.), as
amended from time to time.
The Economic Member now desires to amend and restate in its entirety
the Existing LLC Agreement in order to, among other things, provide for the
admission of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ as Special Members.
The Economic Member, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ hereby
agrees as follows:
Section 1. NAME.
The name of the limited liability company formed hereby is WFN Credit
Company, LLC.
Section 2. PRINCIPAL BUSINESS OFFICE.
The principal business office of the Company shall be located at ▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ or such other location as may
hereafter be determined by the Economic Member.
Section 3. REGISTERED OFFICE.
The address of the registered office of the Company in the State of
Delaware is c/o The Corporation Trust Company, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Section 4. REGISTERED AGENT.
The name and address of the registered agent of the Company for service
of process on the Company in the State of Delaware is The Corporation Trust
Company, ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ of ▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
Section 5. MEMBERS.
(a) The mailing address of the Economic Member is set forth on SCHEDULE
B attached hereto. The Economic Member was admitted to the Company as a member
of the Company upon its execution of a counterpart signature page to the
Existing LLC Agreement.
(b) Subject to SECTION 9(j), the Economic Member may act by written
consent.
(c) Upon the occurrence of any event that causes the Economic Member to
cease to be a member of the Company (other than (i) upon an assignment by the
Economic Member of all of its limited liability company interest in the Company
and the admission of the transferee pursuant to SECTIONS 21 and 23, or (ii) the
resignation of the Economic Member and the admission of an additional member of
the Company pursuant to SECTIONS 22 and 23), each person acting as an
Independent Director pursuant to SECTION 10 shall, without any action of any
Person and simultaneously with the Economic Member ceasing to be a member of the
Company, automatically be admitted to the Company as a Special Member and shall
continue the Company without dissolution. No Special Member may resign from the
Company or transfer its rights as Special Member unless (i) a successor Special
Member has been admitted to the Company as Special Member by executing a
counterpart to this Agreement, and (ii) such successor has also accepted its
appointment as Independent Director pursuant to SECTION 10; provided, however,
the Special Members shall automatically cease to be members of the Company upon
the admission to the Company of a substitute Economic Member. Each Special
Member shall be a member of the Company that has no interest in the profits,
losses and capital of the Company and has no right to receive any distributions
of Company assets. Pursuant to Section 18-301 of the Act, a Special Member shall
not be required to make any capital contributions to the Company and shall not
receive a limited liability company interest in the Company. A Special Member,
in its capacity as Special Member, may not bind the Company. Except as required
by any mandatory provision of the Act, each Special Member, in its capacity as
Special Member, shall have no right to vote on, approve or otherwise consent to
any action by, or matter relating to, the Company, including, without
limitation, the merger, consolidation or conversion of the Company. Nothing in
the immediately preceding sentence shall limit the right of any Special Member
in his or her capacity as an Independent Director to vote on any actions as
further described herein. In order to implement the admission to the Company of
each Special Member, each person acting as an Independent Director pursuant to
SECTION 10 shall execute a counterpart to this Agreement. Prior to its admission
to the Company as Special Member, each person acting as an Independent Director
pursuant to SECTION 10 shall not be a member of the Company.
Section 6. CERTIFICATES.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ is hereby designated as an "authorized person" within
the meaning of the Act, and has executed, delivered and filed the Certificate of
Formation of the Company with the Secretary of State of the State of Delaware.
Upon the filing of the Certificate of Formation
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with the Secretary of State of the State of Delaware, his powers as an
"authorized person" ceased, and the Economic Member thereupon became the
designated "authorized person" and shall continue as the designated "authorized
person" within the meaning of the Act. The Economic Member or an Officer shall
execute, deliver and file any other certificates (and any amendments and/or
restatements thereof) necessary for the Company to qualify to do business in any
other jurisdiction in which the Company may wish to conduct business.
The existence of the Company as a separate legal entity shall continue
until cancellation of the Certificate of Formation as provided in the Act.
Section 7. PURPOSES. The purpose to be conducted or promoted by the Company
is to engage in the following activities:
(a) to purchase or otherwise acquire from World Financial Network
National Bank and its affiliates or trusts formed by World Financial Network
National Bank or its affiliates, and to hold, sell, transfer or pledge or
otherwise exercise ownership rights with respect to credit card receivables (or
interests therein), recoveries and collections related to such credit card
receivables, any rights of World Financial Network National Bank and its
affiliates related to such credit card receivables and any and all proceeds of
the foregoing (the "CREDIT CARD ASSETS");
(b) to act as settlor or depositor of trusts or other entities (a
"TRUST") formed to issue bonds, notes, certificates or other securities secured
by or evidencing beneficial ownership interests in the Credit Card Assets;
(c) to acquire, own, hold, transfer, assign, pledge and otherwise deal
with bonds, notes, certificates and other securities issued by a Trust or
pursuant to an indenture or similar agreement to which such a Trust is a party;
(d) to own equity interests in other limited liability companies or
partnerships whose purposes are restricted to those set forth in clauses (a)
through (c) above;
(e) for federal, state or local tax purposes, to serve as general
partner of any Trust;
(f) to establish any reserve account, spread account or other credit
enhancement for the benefit of any bond, note, certificate or other security
issued by any Trust or under any related indenture and to otherwise invest any
proceeds from Credit Card Assets and any other income as determined by the
Company's board of directors;
(g) to issue membership interests as provided for herein; and
(h) to engage in any lawful act or activity and to exercise any powers
permitted to limited liability companies organized under the laws of the State
of Delaware that are related to or incidental to and necessary, suitable or
convenient for the accomplishment of the purposes specified in CLAUSES (a)
through (g) above (including, without limitation (i) the registration or
qualification of any securities issued by any Trust under the federal securities
laws or the Blue
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Sky laws of any State or jurisdiction and (ii) the entering into of interest
rate or basis swap, cap, floor or collar agreements, currency exchange
agreements or similar hedging transactions and referral, management, servicing
and administration agreements).
(i) The Company, by or through the Economic Member, or any Director or
Officer on behalf of the Company, may enter into and perform the Transaction
Documents and all documents, agreements, certificates, or financing statements
contemplated thereby or related thereto, all without any further act, vote or
approval of any other Person notwithstanding any other provision of this
Agreement, the Act or applicable law, rule or regulation. The foregoing
authorization shall not be deemed a restriction on the powers of the Economic
Member or any Director or Officer to enter into other agreements on behalf of
the Company.
Section 8. POWERS.
Subject to SECTION 9(j), the Company, and the Board of Directors and
the Officers of the Company on behalf of the Company, (i) shall have and
exercise all powers necessary, convenient or incidental to accomplish its
purposes as set forth in SECTION 7 and (ii) shall have and exercise all of the
powers and rights conferred upon limited liability companies formed pursuant to
the Act.
Section 9. MANAGEMENT.
(a) BOARD OF DIRECTORS. Subject to SECTION 9(j), the business and
affairs of the Company shall be managed by or under the direction of a Board of
one or more Directors designated by the Economic Member. Subject to SECTION 10,
the Economic Member may determine at any time in its sole and absolute
discretion the number of Directors to constitute the Board. The authorized
number of Directors may be increased or decreased by the Economic Member at any
time in its sole and absolute discretion, upon notice to all Directors, and
subject in all cases to SECTION 10. The initial number of Directors shall be
five, two of which shall be Independent Directors pursuant to SECTION 10. Each
Director elected, designated or appointed by the Economic Member shall hold
office until a successor is elected and qualified or until such Director's
earlier death, resignation, expulsion or removal. Each Director shall execute
and deliver the Directors Agreement. A Director need not be a Special Member.
The initial Directors designated by the Economic Member are listed on SCHEDULE D
hereto.
(b) POWERS. Subject to SECTION 9(j), the Board of Directors shall have
the power to do any and all acts necessary, convenient or incidental to or for
the furtherance of the purposes described herein, including all powers,
statutory or otherwise. Subject to SECTION 7, the Board of Directors has the
authority to bind the Company.
(c) MEETING OF THE BOARD OF DIRECTORS. The Board of Directors of the
Company may hold meetings, both regular and special, within or outside the State
of Delaware. Regular meetings of the Board may be held without notice at such
time and at such place as shall from time to time be determined by the Board.
Special meetings of the Board may be called by the President on not less than
one day's notice to each Director by telephone, facsimile, mail, telegram or any
other means of communication, and special meetings shall be called by the
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President or Secretary in like manner and with like notice upon the written
request of any one or more of the Directors.
(d) QUORUM: ACTS OF THE BOARD. At all meetings of the Board, a majority
of the Directors shall constitute a quorum for the transaction of business and,
except as otherwise provided in any other provision of this Agreement, the act
of a majority of the Directors present at any meeting at which there is a quorum
shall be the act of the Board. If a quorum shall not be present at any meeting
of the Board, the Directors present at such meeting may adjourn the meeting from
time to time, without notice other than announcement at the meeting, until a
quorum shall be present. Any action required or permitted to be taken at any
meeting of the Board or of any committee thereof may be taken without a meeting
if all members of the Board or committee, as the case may be, consent thereto in
writing, and the writing or writings are filed with the minutes of proceedings
of the Board or committee, as the case may be.
(e) ELECTRONIC COMMUNICATIONS. Members of the Board, or any committee
designated by the Board, may participate in meetings of the Board, or any
committee, by means of telephone conference or similar communications equipment
that allows all Persons participating in the meeting to hear each other, and
such participation in a meeting shall constitute presence in Person at the
meeting. If all the participants are participating by telephone conference or
similar communications equipment, the meeting shall be deemed to be held at the
principal place of business of the Company.
(f) COMMITTEES OF DIRECTORS.
(i) The Board may, by resolution passed by a majority of the
whole Board, designate one or more committees, each
committee to consist of one or more of the Directors of
the Company. The Board may designate one or more Directors
as alternate members of any committee, who may replace any
absent or disqualified member at any meeting of the
committee.
(ii) In the absence or disqualification of a member of a
committee, the member or members thereof present at
any meeting and not disqualified from voting, whether
or not such members constitute a quorum, may
unanimously appoint another member of the Board to
act at the meeting in the place of any such absent or
disqualified member.
(iii) Any such committee, to the extent provided in the
resolution of the Board, shall have and may exercise
all the powers and authority of the Board in the
management of the business and affairs of the
Company. Such committee or committees shall have such
name or names as may be determined from time to time
by resolution adopted by the Board. Each committee
shall keep regular minutes of its meetings and report
the same to the Board when required.
(g) COMPENSATION OF DIRECTORS; EXPENSES. The Board shall have the
authority to fix the compensation of Directors. The Directors may be paid
their expenses, if any, of attendance at
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meetings of the Board, which may be a fixed sum for attendance at each meeting
of the Board or a stated salary as Director. No such payment shall preclude any
Director from serving the Company in any other capacity and receiving
compensation therefor. Members of special or standing committees may be allowed
like compensation for attending committee meetings.
(h) REMOVAL OF DIRECTORS. Unless otherwise restricted by law, any
Director or the entire Board of Directors may be removed or expelled, with or
without cause, at any time by the Economic Member, and any vacancy caused by any
such removal or expulsion may be filled by action of the Economic Member.
(i) DIRECTORS AS AGENTS. To the extent of their powers set forth in
this Agreement and subject to SECTION 9(j), the Directors are agents of the
Company for the purpose of the Company's business, and the actions of the
Directors taken in accordance with such powers set forth in this Agreement shall
bind the Company. Notwithstanding the last sentence of Section 18-402 of the
Act, except as provided in this Agreement or in a resolution of the Directors, a
Director may not bind the Company.
(j) LIMITATIONS ON THE COMPANY'S ACTIVITIES.
(i) This SECTION 9(j) is being adopted in order to comply
with certain provisions required in order to qualify
the Company as a "special purpose" entity.
(ii) The Economic Member shall not, so long as any Obligation
is outstanding, amend, alter, change or repeal the
definition of "Independent Director" or SECTIONS 5(c), 7,
8, 9, 10, 16, 20, 21, 22, 23, 24, 25, 26 or 31 or SCHEDULE
A of this Agreement without the unanimous written consent
of the Board (including all Independent Directors).
Subject to this SECTION 9(j), the Economic Member reserves
the right to amend, alter, change or repeal any provisions
contained in this Agreement in accordance with SECTION 31.
(iii) Notwithstanding any other provision of this Agreement and
any provision of law that otherwise so empowers the
Company, the Economic Member, any Special Member, the
Board, any Officer or any other Person, neither the
Economic Member nor any Special Member nor the Board nor
any Officer nor any other Person shall be authorized or
empowered, nor shall they permit the Company, without the
prior unanimous written consent of the Economic Member and
the Board (including all Independent Directors), to take
any Material Action, PROVIDED, HOWEVER, that the Board may
not vote on, or authorize the taking of, any Material
Action, unless there are at least two Independent
Directors then serving in such capacity.
(iv) The Board and the Economic Member shall cause the Company
to do or cause to be done all things necessary to preserve
and keep in full force and effect its existence, rights
(charter and statutory) and franchises; PROVIDED,
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HOWEVER, that the Company shall not be required to
preserve any such right or franchise if: (1) the Board
shall determine that the preservation thereof is no longer
desirable for the conduct of its business and that the
loss thereof is not disadvantageous in any material
respect to the Company and (2) so long as the Obligations
are outstanding, the Rating Agency Condition is satisfied.
The Board also shall cause the Company to:
(A) maintain its own separate books and records and bank
accounts;
(B) at all times hold itself out to the public
and all other Persons as a legal entity
separate from the Economic Member and any
other Person;
(C) have a Board of Directors separate from that of the
Economic Member and any other Person;
(D) file its own tax returns, if any, as may be
required under applicable law, to the extent
(1) not part of a consolidated group filing
a consolidated return or returns or (2) not
treated as a division for tax purposes of
another taxpayer, and pay any taxes so
required to be paid under applicable law;
(E) except as contemplated by the Transaction Documents, not
commingle its assets with assets of any other Person;
(F) conduct its business in its own name and strictly comply
with all organizational formalities to maintain its
separate existence;
(G) maintain separate financial statements;
(H) pay its own liabilities only out of its own funds;
(I) maintain an arm's length relationship with its
Affiliates and the Economic Member;
(J) pay the salaries of its own employees, if any;
(K) not hold out its credit or assets as being available to
satisfy the obligations of others;
(L) allocate fairly and reasonably any overhead for shared
office space;
(M) use separate stationery, invoices and checks;
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(N) except as contemplated by the Transaction Documents, not
pledge its assets for the benefit of any other Person;
(O) correct any known misunderstanding regarding its
separate identity;
(P) maintain adequate capital in light of its contemplated
business purpose, transactions and liabilities;
(Q) cause its Board of Directors to meet at
least annually or act pursuant to written
consent and keep minutes of such meetings
and actions and observe all other Delaware
limited liability company formalities;
(R) not acquire any securities of the Economic Member; and
(S) cause the Directors, Officers, agents and
other representatives of the Company to act
at all times with respect to the Company
consistently and in furtherance of the
foregoing and in the best interests of the
Company.
Failure of the Company, or the Economic
Member or Board on behalf of the Company, to
comply with any of the foregoing covenants
or any other covenants contained in this
Agreement shall not affect the status of the
Company as a separate legal entity or the
limited liability of the Economic Member or
the Directors.
(v) So long as any Obligation is outstanding, the Board shall
not cause or permit the Company to:
(A) except as contemplated by the Transaction Documents,
guarantee any obligation of any Person, including any
Affiliate;
(B) engage, directly or indirectly, in any
business other than the actions required or
permitted to be performed under SECTION 7,
the Transaction Documents or this SECTION
9(j);
(C) incur, create or assume any indebtedness other than as
expressly permitted under the Transaction Documents;
(D) make or permit to remain outstanding any
loan or advance to, or, except as permitted
by SECTION 7 and CLAUSE (j)(iii) of this
SECTION (9), to own or acquire any stock or
securities of, any Person, except that the
Company may invest in those investments
permitted under the Transaction Documents
and may make any advance required or
expressly permitted to be made pursuant to
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any provisions of the Transaction Documents and permit
the same to remain outstanding in accordance with such
provisions;
(E) to the fullest extent permitted by law, engage in any
dissolution or liquidation other than such activities as
are expressly permitted pursuant to any provision of the
Transaction Documents; or
(F) except as permitted by SECTION 7 and CLAUSE (j)(iii) of
this SECTION 9, to form, acquire or hold any subsidiary
(whether corporate, partnership, limited liability
company or other).
Section 10. INDEPENDENT DIRECTOR.
As long as any Obligation is outstanding, the Economic Member shall
cause the Company at all times to have at least two Independent Directors who
will be appointed by the Economic Member. To the fullest extent permitted by
law, including Section 18-1101(c) of the Act, the Independent Directors shall
consider only the interests of the Company, including its respective creditors,
in acting or otherwise voting on the matters referred to in SECTION 9(j)(iii).
No resignation or removal of an Independent Director, and no appointment of a
successor Independent Director, shall be effective until such successor (i)
shall have accepted his or her appointment as an Independent Director by a
written instrument, which may be a counterpart signature page to the Directors
Agreement, and (ii) shall have executed a counterpart to this Agreement as
required by SECTION 5(c). In the event of a vacancy in the position of
Independent Director, the Economic Member shall, as soon as practicable, appoint
a successor Independent Director. All right, power and authority of the
Independent Directors shall be limited to the extent necessary to exercise those
rights and perform those duties specifically set forth in this Agreement. Except
as provided in the second sentence of this SECTION 10, in exercising their
rights and performing their duties under this Agreement, any Independent
Director shall have a fiduciary duty of loyalty and care similar to that of a
director of a business corporation organized under the General Corporation Law
of the State of Delaware. No Independent Director shall at any time serve as
trustee in bankruptcy for any Affiliate of the Company.
Section 11. OFFICERS.
(a) OFFICERS. The initial Officers of the Company shall be designated
by the Economic Member. The additional or successor Officers of the Company
shall be chosen by the Board and shall consist of at least a President, a
Secretary and a Treasurer. The Board of Directors may also choose one or more
Vice Presidents, Assistant Secretaries and Assistant Treasurers. Any number of
offices may be held by the same person. The Board shall choose a President, a
Secretary and a Treasurer. The Board may appoint such other Officers and agents
as it shall deem necessary or advisable who shall hold their offices for such
terms and shall exercise such powers and perform such duties as shall be
determined from time to time by the Board. The salaries of all Officers and
agents of the Company shall be fixed by or in the manner prescribed by the
Board. The Officers of the Company shall hold office until their successors are
chosen and qualified. Any Officer may be removed at any time, with or without
cause, by the affirmative vote of a majority of the Board. Any vacancy occurring
in any office of the
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Company shall be filled by the Board. The initial Officers of the Company
designated by the Economic Member are listed on Schedule E hereto.
(b) PRESIDENT. The President shall be the chief executive officer of
the Company, shall preside at all meetings of the Board, shall be responsible
for the general and active management of the business of the Company and shall
see that all orders and resolutions of the Board are carried into effect. The
President or any other Officer authorized by the President or the Board shall
execute all bonds, mortgages and other contracts, except: (i) where required or
permitted by law or this Agreement to be otherwise signed and executed,
including SECTION 7(b); (ii) where signing and execution thereof shall be
expressly delegated by the Board to some other Officer or agent of the Company,
and (iii) as otherwise permitted in SECTION 11(c).
(c) VICE PRESIDENT. In the absence of the President or in the event of
the President's inability to act, the Vice President, if any (or in the event
there be more than one Vice President, the Vice Presidents in the order
designated by the Directors, or in the absence of any designation, then in the
order of their election), shall perform the duties of the President, and when so
acting, shall have all the powers of and be subject to all the restrictions upon
the President. The Vice Presidents, if any, shall perform such other duties and
have such other powers as the Board may from time to time prescribe.
(d) SECRETARY AND ASSISTANT SECRETARY. The Secretary shall be
responsible for filing legal documents and maintaining records for the Company.
The Secretary shall attend all meetings of the Board and record all the
proceedings of the meetings of the Company and of the Board in a book to be kept
for that purpose and shall perform like duties for the standing committees when
required. The Secretary shall give, or shall cause to be given, notice of all
meetings of the Economic Member, if any, and special meetings of the Board, and
shall perform such other duties as may be prescribed by the Board or the
President, under whose supervision the Secretary shall serve. The Assistant
Secretary, or if there be more than one, the Assistant Secretaries in the order
determined by the Board (or if there be no such determination, then in order of
their election), shall, in the absence of the Secretary or in the event of the
Secretary's inability to act, perform the duties and exercise the powers of the
Secretary and shall perform such other duties and have such other powers as the
Board may from time to time prescribe.
(e) TREASURER AND ASSISTANT TREASURER. The Treasurer shall have the
custody of the Company funds and securities and shall keep full and accurate
accounts of receipts and disbursements in books belonging to the Company and
shall deposit all moneys and other valuable effects in the name and to the
credit of the Company in such depositories as may be designated by the Board.
The Treasurer shall disburse the funds of the Company as may be ordered by the
Board, taking proper vouchers for such disbursements, and shall render to the
President and to the Board, at its regular meetings or when the Board so
requires, an account of all of the Treasurer's transactions and of the financial
condition of the Company. The Assistant Treasurer, or if there shall be more
than one, the Assistant Treasurers in the order determined by the Board (or if
there be no such determination, then in the order of their election), shall, in
the absence of the Treasurer or in the event of the Treasurer's inability to
act, perform the duties and exercise the powers of the Treasurer and shall
perform such other duties and have such other powers as the Board may from time
to time prescribe.
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(f) OFFICERS AS AGENTS. The Officers, to the extent of their powers set
forth in this Agreement or otherwise vested in them by action of the Board not
inconsistent with this Agreement, are agents of the Company for the purpose of
the Company's business and, subject to SECTION 9(J), the actions of the Officers
taken in accordance with such powers shall bind the Company.
(g) DUTIES OF BOARD AND OFFICERS. Except to the extent otherwise
provided herein, each Director and Officer shall have a fiduciary duty of
loyalty and care similar to that of directors and officers of business
corporations organized under the General Corporation Law of the State of
Delaware.
Section 12. LIMITED LIABILITY.
Except as otherwise expressly provided by the Act, the debts,
obligations and liabilities of the Company, whether arising in contract, tort or
otherwise, shall be the debts, obligations and liabilities solely of the
Company, and neither the Economic Member nor the Special Members nor any
Director shall be obligated personally for any such debt, obligation or
liability of the Company solely by reason of being an Economic Member, a Special
Member or a Director of the Company.
Section 13. CAPITAL CONTRIBUTIONS.
The Economic Member has contributed to the Company property of an
agreed value as listed on SCHEDULE B attached hereto. In accordance with Section
5(c), the Special Members shall not be required to make any capital
contributions to the Company.
Section 14. ADDITIONAL CONTRIBUTIONS.
The Economic Member is not required to make any additional capital
contribution to the Company. However, the Economic Member may make additional
capital contributions to the Company at any time upon the written consent of
such Economic Member. To the extent that the Economic Member makes an additional
capital contribution to the Company, the Economic Member shall revise SCHEDULE B
of this Agreement. The provisions of this Agreement, including this SECTION 14,
are intended to benefit the Economic Member and the Special Members and, to the
fullest extent permitted by law, shall not be construed as conferring any
benefit upon any creditor of the Company (and no such creditor of the Company
shall be a third- party beneficiary of this Agreement) and the Economic Member
and the Special Members shall not have any duty or obligation to any creditor of
the Company to make any contribution to the Company or to issue any call for
capital pursuant to this Agreement.
Section 15. ALLOCATION OF PROFITS AND LOSSES.
The Company's profits and losses shall be allocated to the Economic
Member.
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Section 16. DISTRIBUTIONS.
Distributions shall be made to the Economic Member at the times and in
the aggregate amounts determined by the Board. Notwithstanding any provision to
the contrary contained in this Agreement, the Company shall not be required to
make a distribution to the Economic Member on account of its interest in the
Company if such distribution would violate Section 18-607 of the Act or any
other applicable law or any Transaction Document.
Section 17. BOOKS AND RECORDS.
The Board shall keep or cause to be kept complete and accurate books of
account and records with respect to the Company's business. The books of the
Company shall at all times be maintained by the Board. The Economic Member and
its duly authorized representatives shall have the right to examine the Company
books, records and documents during normal business hours. The Company, and the
Board on behalf of the Company, shall not have the right to keep confidential
from the Economic Member any information that the Board would otherwise be
permitted to keep confidential from the Economic Member pursuant to Section
18-305(c) of the Act. The Company's books of account shall be kept using the
method of accounting determined by the Economic Member. The Company's
independent auditor, if any, shall be an independent public accounting firm
selected by the Economic Member.
Section 18. REPORTS.
(a) Within 60 days after the end of each fiscal quarter, the Board
shall cause to be prepared an unaudited report setting forth as of the end of
such fiscal quarter:
(i) unless such quarter is the last fiscal quarter, a balance
sheet of the Company; and
(ii) unless such quarter is the last fiscal quarter, an income
statement of the Company for such fiscal quarter.
(b) The Board shall use diligent efforts to cause to be prepared and
mailed to the Economic Member, within 90 days after the end of each fiscal year,
an audited or unaudited report setting forth as of the end of such fiscal year:
(i) a balance sheet of the Company;
(ii) an income statement of the Company for such fiscal year; and
(iii) a statement of the Economic Member's capital account.
(c) The Board shall, after the end of each fiscal year, use reasonable
efforts to cause the Company's independent accountants, if any, to prepare and
transmit to the Economic Member as promptly as possible any such tax information
as may be reasonably necessary to enable the
12
Economic Member to prepare its federal, state and local income tax returns
relating to such fiscal year.
Section 19. OTHER BUSINESS.
The Economic Member, the Special Members and any Affiliate of the
Economic Member or the Special Members may engage in or possess an interest in
other business ventures (unconnected with the Company) of every kind and
description, independently or with others. The Company shall not have any rights
in or to such independent ventures or the income or profits therefrom by virtue
of this Agreement.
Section 20. EXCULPATION AND INDEMNIFICATION.
(a) Neither the Economic Member nor the Special Members nor any
Officer, Director, employee or agent of the Company nor any employee,
representative, agent or Affiliate of the Economic Member or the Special Members
(collectively, the "COVERED PERSONS") shall be liable to the Company or any
other Person who has an interest in or claim against the Company for any loss,
damage or claim incurred by reason of any act or omission performed or omitted
by such Covered Person in good faith on behalf of the Company and in a manner
reasonably believed to be within the scope of the authority conferred on such
Covered Person by this Agreement, except that a Covered Person shall be liable
for any such loss, damage or claim incurred by reason of such Covered Person's
gross negligence or willful misconduct.
(b) To the fullest extent permitted by applicable law, a Covered Person
shall be entitled to indemnification from the Company for any loss, damage or
claim incurred by such Covered Person by reason of any act or omission performed
or omitted by such Covered Person in good faith on behalf of the Company and in
a manner reasonably believed to be within the scope of the authority conferred
on such Covered Person by this Agreement, except that no Covered Person shall be
entitled to be indemnified in respect of any loss, damage or claim incurred by
such Covered Person by reason of such Covered Person's gross negligence or
willful misconduct with respect to such acts or omissions; PROVIDED, HOWEVER,
that any indemnity under this SECTION 20 by the Company shall be provided out of
and to the extent of Company assets only, and the Economic Member and the
Special Members shall not have personal liability on account thereof; and
PROVIDED FURTHER, that so long as any Obligation is outstanding, no indemnity
payment from funds of the Company (as distinct from funds from other sources,
such as insurance) of any indemnity under this SECTION 20 shall be payable from
amounts allocable to any other Person pursuant to the Transaction Documents.
(c) To the fullest extent permitted by applicable law, expenses
(including legal fees) incurred by a Covered Person defending any claim, demand,
action, suit or proceeding shall, from time to time, be advanced by the Company
prior to the final disposition of such claim, demand, action, suit or proceeding
upon receipt by the Company of an undertaking by or on behalf of the Covered
Person to repay such amount if it shall be determined that the Covered Person is
not entitled to be indemnified as authorized in this SECTION 20.
13
(d) A Covered Person shall be fully protected in relying in good faith
upon the records of the Company and upon such information, opinions, reports or
statements presented to the Company by any Person as to matters the Covered
Person reasonably believes are within such other Person's professional or expert
competence and who has been selected with reasonable care by or on behalf of the
Company, including information, opinions, reports or statements as to the value
and amount of the assets, liabilities, or any other facts pertinent to the
existence and amount of assets from which distributions to the Economic Member
might properly be paid.
(e) To the extent that, at law or in equity, a Covered Person has
duties (including fiduciary duties) and liabilities relating thereto to the
Company or to any other Covered Person, a Covered Person acting under this
Agreement shall not be liable to the Company or to any other Covered Person for
its good faith reliance on the provisions of this Agreement or any approval or
authorization granted by the Company or any other Covered Person. The provisions
of this Agreement, to the extent that they restrict the duties and liabilities
of a Covered Person otherwise existing at law or in equity, are agreed by the
Economic Member and the Special Members to replace such other duties and
liabilities of such Covered Person.
(f) The foregoing provisions of this SECTION 20 shall survive any
termination of this Agreement.
Section 21. ASSIGNMENTS.
Subject to SECTION 23, the Economic Member may assign in whole or in
part its limited liability company interest in the Company. If the Economic
Member transfers all of its limited liability company interest in the Company
pursuant to this SECTION 21, the transferee shall be admitted to the Company as
a member of the Company upon its execution of an instrument signifying its
agreement to be bound by the terms and conditions of this Agreement, which
instrument may be a counterpart signature page to this Agreement. Such admission
shall be deemed effective immediately prior to the transfer and, immediately
following such admission, the transferor Economic Member shall cease to be a
member of the Company. Notwithstanding anything in this Agreement to the
contrary, any successor to the Economic Member by merger or consolidation in
compliance with the Transaction Documents shall, without further act, be the
Economic Member hereunder, and such merger or consolidation shall not constitute
an assignment for purposes of this Agreement and the Company shall continue
without dissolution.
Section 22. RESIGNATION.
So long as any Obligation is outstanding, the Economic Member may not
resign, except as permitted under the Transaction Documents and if the Rating
Agency Condition is satisfied. If the Economic Member is permitted to resign
pursuant to this SECTION 22, an additional member of the Company shall be
admitted to the Company, subject to SECTION 23, upon its execution of an
instrument signifying its agreement to be bound by the terms and conditions of
this Agreement, which instrument may be a counterpart signature page to this
Agreement. Such admission shall be deemed effective immediately prior to the
resignation and, immediately following such admission, the resigning Economic
Member shall cease to be a member of the Company.
14
Section 23. ADMISSION OF ADDITIONAL MEMBERS.
One or more additional members of the Company may be admitted to the
Company with the written consent of the Economic Member; PROVIDED, HOWEVER,
that, notwithstanding the foregoing, so long as any Obligation remains
outstanding, no additional Economic Member may be admitted to the Company unless
the Rating Agency Condition is satisfied.
Section 24. DISSOLUTION.
(a) Subject to SECTION 9(j), the Company shall be dissolved, and its
affairs shall be wound up upon the first to occur of the following: (i) the
termination of the legal existence of the last remaining member of the Company
or the occurrence of any other event which terminates the continued membership
of the last remaining member of the Company in the Company unless the business
of the Company is continued in a manner permitted by this Agreement or the Act
or (ii) the entry of a decree of judicial dissolution under Section 18-802 of
the Act. Upon the occurrence of any event that causes the last remaining member
of the Company to cease to be a member of the Company, to the fullest extent
permitted by law, the personal representative of such member is hereby
authorized to, and shall, within 90 days after the occurrence of the event that
terminated the continued membership of such member in the Company, agree in
writing (i) to continue the Company and (ii) to the admission of the personal
representative or its nominee or designee, as the case may be, as a substitute
member of the Company, effective as of the occurrence of the event that
terminated the continued membership of the last remaining member of the Company
in the Company.
(b) Notwithstanding any other provision of this Agreement, the
Bankruptcy of the Economic Member or a Special Member shall not cause the
Economic Member or Special Member, respectively, to cease to be a member of the
Company and upon the occurrence of such an event, the business of the Company
shall continue without dissolution.
(c) In the event of dissolution, the Company shall conduct only such
activities as are necessary to wind up its affairs (including the sale of the
assets of the Company in an orderly manner), and the assets of the Company shall
be applied in the manner, and in the order of priority, set forth in Section
18-804 of the Act.
(d) The Company shall terminate when (i) all of the assets of the
Company, after payment of or due provision for all debts, liabilities and
obligations of the Company shall have been distributed to the Economic Member in
the manner provided for in this Agreement and (ii) the Certificate of Formation
shall have been canceled in the manner required by the Act.
Section 25. WAIVER OF PARTITION; NATURE OF INTEREST.
Except as otherwise expressly provided in this Agreement, to the
fullest extent permitted by law, each of the Economic Member and the Special
Members hereby irrevocably waives any right or power that such Person might have
to cause the Company or any of its assets to be partitioned, to cause the
appointment of a receiver for all or any portion of the assets of the Company,
to compel any sale of all or any portion of the assets of the Company pursuant
to any
15
applicable law or to file a complaint or to institute any proceeding at law or
in equity to cause the dissolution, liquidation, winding up or termination of
the Company. The Economic Member shall not have any interest in any specific
assets of the Company, and the Economic Member shall not have the status of a
creditor with respect to any distribution pursuant to SECTION 16 hereof. The
interest of the Economic Member in the Company is personal property.
Section 26. BENEFITS OF AGREEMENT; NO THIRD-PARTY RIGHTS.
None of the provisions of this Agreement shall be for the benefit of or
enforceable by any creditor of the Company or by any creditor of the Economic
Member or a Special Member. Nothing in this Agreement shall be deemed to create
any right in any Person (other than Covered Persons) not a party hereto, and
this Agreement shall not be construed in any respect to be a contract in whole
or in part for the benefit of any third Person (except as provided in SECTION
29).
Section 27. SEVERABILITY OF PROVISIONS.
Each provision of this Agreement shall be considered severable and if
for any reason any provision or provisions herein are determined to be invalid,
unenforceable or illegal under any existing or future law, such invalidity,
unenforceability or illegality shall not impair the operation of or affect those
portions of this Agreement which are valid, enforceable and legal.
Section 28. ENTIRE AGREEMENT.
This Agreement constitutes the entire agreement of the parties with
respect to the subject matter hereof.
Section 29. BINDING AGREEMENT.
Notwithstanding any other provision of this Agreement, the Economic
Member agrees that this Agreement, including, without limitation, SECTIONS 7, 8,
9, 10, 20, 21, 22, 23, 24, 26, 29 and 31, constitutes a legal, valid and binding
agreement of the Economic Member, and is enforceable against the Economic Member
by the Independent Directors, in accordance with its terms. In addition, the
Independent Directors shall be intended beneficiaries of this Agreement.
Section 30. GOVERNING LAW.
This Agreement shall be governed by and construed under the laws of the
State of Delaware (without regard to conflict of laws principles), all rights
and remedies being governed by said laws.
Section 31. AMENDMENTS.
Subject to Section 9(j), this Agreement may be modified, altered,
supplemented or amended pursuant to a written agreement executed and delivered
by the Economic Member. Notwithstanding anything to the contrary in this
Agreement, so long as any Obligation is outstanding, this Agreement may not be
modified, altered, supplemented or amended unless the
16
Rating Agency Condition is satisfied except: (i) to cure any ambiguity or (ii)
to convert or supplement any provision in a manner consistent with the intent of
this Agreement and the other Transaction Documents.
Section 32. COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of
which shall be deemed an original of this Agreement and all of which together
shall constitute one and the same instrument.
Section 33. NOTICES.
Any notices required to be delivered hereunder shall be in writing and
personally delivered, mailed or sent by telecopy, electronic mail or other
similar form of rapid transmission, and shall be deemed to have been duly given
upon receipt (a) in the case of the Company, to the Company at its address in
SECTION 2, (b) in the case of the Economic Member, to the Economic Member at its
address as listed on SCHEDULE B attached hereto and (c) in the case of either of
the foregoing, at such other address as may be designated by written notice to
the other party.
Section 34. EFFECTIVENESS.
Pursuant to Section 18-201 (d) of the Act, this Agreement shall be
effective as of August 21, 2001.
17
IN WITNESS WHEREOF, the undersigned, intending to be legally bound
hereby, has duly executed this Limited Liability Company Agreement as of the 21
day of August, 2001.
ECONOMIC MEMBER:
WORLD FINANCIAL NETWORK
NATIONAL BANK
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Chief Financial Officer
SPECIAL MEMBERS:
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
----------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------------------
S-1
SCHEDULE A
DEFINITIONS
A. DEFINITIONS
When used in this Agreement, the following terms not otherwise defined
herein have the following meanings:
"ACT" has the meaning set forth in the preamble to this Agreement.
"AFFILIATE" means, with respect to any Person, any other Person
directly or indirectly Controlling or Controlled by or under direct or indirect
common Control with such Person.
"AGREEMENT" means this Limited Liability Company Agreement of the
Company, together with the schedules attached hereto, as amended, restated or
supplemented or otherwise modified from time to time.
"BANKRUPTCY" means, with respect to any Person, if such Person (i)
makes an assignment for the benefit of creditors, (ii) files a voluntary
petition in bankruptcy, (iii) is adjudged a bankrupt or insolvent, or has
entered against it an order for relief, in any bankruptcy or insolvency
proceedings, (iv) files a petition or answer seeking for itself any
reorganization, arrangement, composition, readjustment, liquidation or similar
relief under any statute, law or regulation, (v) files an answer or other
pleading admitting or failing to contest the material allegations of a petition
filed against it in any proceeding of this nature, (vi) seeks, consents to or
acquiesces in the appointment of a trustee, receiver or liquidator of the Person
or of all or any substantial part of its properties, or (vii) if 90 days after
the commencement of any proceeding against the Person seeking reorganization,
arrangement, composition, readjustment, liquidation or similar relief under any
statute, law or regulation, if the proceeding has not been dismissed, or if
within 60 days after the appointment without such Person's consent or
acquiescence of a trustee, receiver or liquidator of such Person or of all or
any substantial part of its properties, the appointment is not vacated or
stayed, or within 90 days after the expiration of any such stay, the appointment
is not vacated. The foregoing definition of "Bankruptcy" is intended to replace
and shall supersede and replace the definition of"Bankruptcy" set forth in
Sections 18-101(1) and 18-304 of the Act.
"BOARD" or "BOARD OF DIRECTORS" means the Board of Directors of the
Company.
"CERTIFICATE OF FORMATION" means the Certificate of Formation of the
Company filed with the Secretary of State of the State of Delaware on May 1,
2001, as amended or amended and restated from time to time.
"COMPANY" means WFN Credit Company, LLC, a Delaware limited liability
company.
"CONTROL" means the possession, directly or indirectly, of the power to
direct or cause the direction of the management or policies of a Person, whether
through the ownership of voting
A-1
securities or general partnership or managing member interests, by contract or
otherwise. "Controlling" and "Controlled" shall have correlative meanings.
Without limiting the generality of the foregoing, a Person shall be deemed to
Control any other Person in which it owns, directly or indirectly, a majority of
the ownership interests.
"COVERED PERSONS" has the meaning set forth in SECTION 20(a).
"CREDIT CARD ASSETS" is defined in SECTION 7.
"DIRECTORS" means the Persons elected to the Board of Directors from
time to time by the Member. A Director is hereby designated as a "manager" of
the Company within the meaning of Section 18-101(10) of the Act.
"DIRECTORS AGREEMENT" means the agreement of the Directors in the form
attached hereto as Schedule C-1 or C-2. The Directors Agreement shall be deemed
incorporated into, and a part of, this Agreement.
"ECONOMIC MEMBER" means World Financial Network National Bank, as the
initial member of the Company, and includes any Person admitted as an additional
member of the Company or a substitute member of the Company pursuant to the
provisions of this Agreement, each in its capacity as a member of the Company;
provided, however, the term "Economic Member" shall not include the Special
Members.
"INDEPENDENT DIRECTOR" means a natural person who, for the five-year
period prior to his or her appointment as Independent Director has not been, and
during the continuation of his or her service as Independent Director is not:
(i) an employee, director, stockholder, member, partner or officer of the
Company or any of its Affiliates (other than his or her service as a Special
Member or an Independent Director of the Company or other Affiliates that are
structured to be "bankruptcy remote"); (ii) a customer or supplier of the
Company or any of its Affiliates; or (iii) any member of the immediate family of
a person described in (i) or (ii).
"MATERIAL ACTION" means to consolidate or merge the Company with or
into any Person, or sell all or substantially all of the assets of the Company,
or to institute proceedings to have the Company be adjudicated bankrupt or
insolvent, or consent to the institution of bankruptcy or insolvency proceedings
against the Company or file a petition seeking, or consent to, reorganization or
relief with respect to the Company under any applicable federal or state law
relating to bankruptcy, or consent to the appointment of a receiver, liquidator,
assignee, trustee, sequestrator (or other similar official) of the Company or a
substantial part of its property, or make any assignment for the benefit of
creditors of the Company, or admit in writing the Company's inability to pay its
debts generally as they become due, or, to the fullest extent permitted by law,
take action in furtherance of any such action, or dissolve or liquidate the
Company.
"OBLIGATIONS" shall mean the indebtedness, liabilities and obligations
of the Company or any Trust under or in connection with this Agreement, the
other Transaction Documents or any related document in effect as of any date of
determination.
A-2
"OFFICER" means an officer of the Company described in SECTION 11.
"OFFICER'S CERTIFICATE" means a certificate signed by any Officer of
the Company who is authorized to act for the Company in matters relating to the
Company.
"PERSON" means any individual, corporation, partnership, joint venture,
limited liability company, limited liability partnership, association, joint
stock company, trust, unincorporated organization, or other organization,
whether or not a legal entity, and any governmental authority.
"RATING AGENCY CONDITION" has the meaning assigned to that term in the
Transaction Documents.
"SPECIAL MEMBER" means, upon such person's admission to the Company as
a member of the Company pursuant to SECTION 5(c), a person acting as Independent
Director, in such person's capacity as a member of the Company. A Special Member
shall only have the rights and duties expressly set forth in this Agreement.
"TRANSACTION DOCUMENTS" means this Agreement, the Directors Agreement,
each pooling and servicing agreement, transfer and servicing agreement,
receivables purchase agreement, indenture or other agreement entered into by the
Company or by a trust at the direction of the Company from time to time in
connection with the acquisition, creation, funding or financing of Credit Card
Assets, and all other documents, instruments and certificates delivered in
connection therewith.
B. RULES OF CONSTRUCTION
Definitions in this Agreement apply equally to both the singular and
plural forms of the defined terms. The words "include" and "including" shall be
deemed to be followed by the phrase "without limitation." The terms "herein,"
"hereof" and "hereunder" and other words of similar import refer to this
Agreement as a whole and not to any particular Section, paragraph or
subdivision. The Section titles appear as a matter of convenience only and shall
not affect the interpretation of this Agreement. All Section, paragraph, clause,
Exhibit or Schedule references not attributed to a particular document shall be
references to such parts of this Agreement.
A-3
SCHEDULE B
MEMBER
Agreed Value of Membership
Name Mailing Address Capital Contribution Interest
---- --------------- -------------------- --------
World Financial ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, $1,000 100%
Network National ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Bank
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
B-1
SCHEDULE C-1
Directors Agreement
WFN Credit Company, LLC
[date]
For good and valuable consideration, each of the undersigned Persons,
who have been designated as directors of WFN Credit Company, LLC, a Delaware
limited liability company (the "Company"), in accordance with the
Limited
Liability Company Agreement of the Company, dated as of May 1, 2001, as it may
be amended or restated from time to time (the "LLC AGREEMENT"), hereby agree as
follows:
1. Each of the undersigned accepts such Person's rights and authority
as a Director under the LLC Agreement and agrees to perform and discharge such
Person's duties and obligations as a Director under the LLC Agreement, and
further agrees that such rights, authorities, duties and obligations under the
LLC Agreement shall continue until such Person's successor as a Director is
designated or until such Person's resignation or removal as a Director in
accordance with the LLC Agreement. Each of the undersigned agrees and
acknowledges that it has been designated as a "manager" of the Company within
the meaning of the Delaware Limited Liability Company Act.
2. So long as any Obligation is outstanding, each of the undersigned
agrees, solely in its capacity as a creditor of the Company on account of any
indemnification or other payment owing to the undersigned by the Company, not to
acquiesce, petition or otherwise invoke or cause the Company to invoke the
process of any court or governmental authority for the purpose of commencing or
sustaining a case against the Company under any federal or state bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Company or any
substantial part of the property of the Company, or ordering the winding up or
liquidation of the affairs of the Company.
3. THIS DIRECTORS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, AND ALL RIGHTS AND REMEDIES
SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF
LAWS.
Initially capitalized terms used and not otherwise defined herein have
the meanings set forth in the LLC Agreement.
This Directors Agreement may be executed in any number of counterparts,
each of which shall be deemed an original of this Directors Agreement and all of
which together shall constitute one and the same instrument.
C-1-1
IN WITNESS WHEREOF, the undersigned have executed this Directors
Agreement as of the day and year first above written.
_____________________________________
_____________________________________
_____________________________________
C-1-2
SCHEDULE C-2
form of
INDEPENDENT DIRECTOR AGREEMENT
THIS Agreement ("AGREEMENT"), made as of the ____ day of
_______________, 2001, is entered into by and between ___________________
("INDEPENDENT DIRECTOR") and ____________________ (the "COMPANY").
RECITALS
WHEREAS, the Company is engaged in the business described in the
Limited Liability Company Agreement attached as EXHIBIT A; and
WHEREAS, the Company desires to nominate and elect ______________ as
the Independent Director.
NOW THEREFORE, the parties agree as follows.
1. INDEPENDENT DIRECTOR. The Company has designated the Independent
Director as a Director under Section 9(a) of the Limited Liability Agreement and
the Independent Director as an independent Director of the Company, agrees to
perform the duties of an independent Director of the Company in a diligent
manner, as described in EXHIBIT A attached hereto. The Company and the
Independent Director recognize that the services of the Independent Director are
to be rendered to the Company on a non-exclusive basis.
2. TERM. The term of this Agreement shall begin and be effective as of
the date hereof, and shall end and terminate on ______________, 2002, except if
terminated sooner by either party by providing thirty days written notice.
Thereafter, this Agreement shall renew for successive one-year terms unless
either party notifies the other in writing thirty days prior to the renewal date
of that party's desire to cancel the Agreement. The Company understands that
this Agreement shall terminate and the Independent Director shall immediately
resign as the Independent Director of the Company if any payments due to AMACAR
Group, L.L.C. under the terms of any agreement between AMACAR Group, L.L.C. and
the Company remain unpaid for 30 days from the date above.
3. BUSINESS EXPENSES. The Company shall pay any reasonable
expenses incurred by the Independent Director in the performance of his or
her duties in accordance with such policies regarding expenses and travel
that the Company may have in effect from time to time; and the Company shall
promptly reimburse the Independent Director for such expenses upon the
submission of appropriate receipts and vouchers unless AMACAR Group, L.L.C.
has been reimbursed for such expenses.
C-2-1
4. CONFIDENTIALITY. From time to time the Independent Director will
receive or otherwise obtain from the Company, in connection with the
Independent Director's duties as a independent Director, certain information
that is non-public, confidential or proprietary in nature (the "CONFIDENTIAL
INFORMATION"). The Independent Director agrees to (i) not use any of the
Confidential Information except in connection with fulfilling the duties of
an independent Director of the Company and (ii) use reasonable efforts to
prevent the disclosure of the Confidential Information to any person other
than (a) to employees, agents, counsel and accountants of the Independent
Director, each of whom the Independent Director will inform of the
non-public, confidential and proprietary nature of such information, (b) as
required by any regulatory or supervisory authority or (c) as otherwise
required by applicable law. This agreement regarding the Confidential
Information is not applicable to any Confidential Information that (i) is or
becomes generally available to the public through no fault or action on the
part of the Independent Director, or the Independent Director's employees,
agents, counsel or accountants or (ii) is or becomes available to the
Independent Director on a non-confidential basis from a source other than the
Company or any of its affiliates. In the event the Independent Director is
required to disclose the Confidential Information, the Independent Director
will request confidential treatment thereof and provide the Company with
written notice of the proposed disclosure prior to the disclosure.
5. ASSIGNMENT. The Independent Director acknowledges that the services
to be rendered by him or her are expert, professional and personal. Accordingly,
unless provided for elsewhere in this Agreement, the Independent Director may
not assign any of his or her rights or delegate any of his or her duties or
obligations under this Agreement; provided, however, that the Independent
Director may enlist other personnel to assist him or her in carrying out his or
her duties and obligations under this Agreement.
6. INDEMNIFICATION. In addition to, and not in limitation of, any
and all rights of indemnification under the Company's
Limited Liability
Company Agreement and By-laws or otherwise (including, without limitation,
any insurance policies), the Company agrees to indemnify and hold harmless
the Independent Director from any and all loss, claim, damage or cause of
action, including reasonable attorneys' fees related thereto ("Claims")
incurred by the Independent Director in the performance of his or her duties
and obligations under this Agreement; provided, however, that the Independent
Director shall not be so indemnified for Claims if they arise from the
Independent Director's negligence or willful misconduct. The benefits of this
Section 6 shall survive the termination of this Agreement.
7. GOVERNING LAW. This Agreement shall be governed and
construed in accordance with the laws of the State of North Carolina.
8. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties hereto pertaining only to the subject matter
hereof.
9. AMENDMENT. No supplement, modification, or amendment of this
Agreement shall be binding unless signed and executed in writing by the
parties or party to be charged.
C-2-2
10. WAIVER AND CONSENT. Failure of either party at any time to require
performance by the other party of any provision hereof shall not affect in any
way the right to require such performance at any time thereafter or performance
of any other provision hereof, nor shall the waiver by either party of a breach
of any provision hereof be taken or held to be a waiver of the provision itself.
11. NOTICES. All notices, requests, demand and communications
required, provided for or contemplated in this Agreement must be in writing
and sent to the parties at the following addresses:
If to the Independent Director: [name]
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
If to the Company: [name and address]
Attn:
----------------------------------
Telephone:
-----------------------------
Telecopy:
------------------------------
Or, to such other persons or addresses as any party may request by
giving written notice of such change to the other party.
12. SEVERABILITY. The invalidity of any provision of this
Agreement, as determined by a Court of competent jurisdiction, shall in no
way affect the validity of any other provision thereof.
IN WITNESS WHEREOF, the Independent Director and the Company have
signed this Agreement effective and binding as of the date first above
written.
----------------------------------------
[Independent Director]
[Company]
By:
------------------------------------
Its:
-----------------------------------
C-2-3
EXHIBIT A
DUTIES OF THE INDEPENDENT DIRECTOR
Limited Liability Company Agreement
C-2-4
SCHEDULE D
DIRECTORS
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1. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
2. ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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D-1
SCHEDULE E
OFFICERS TITLE
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ President
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Vice President and Treasurer
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Senior Vice President and Secretary
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Assistant Secretary
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, ▇▇. Vice President, Tax
E-1