Exhibit 10.44
NORDSTROM CREDIT CARD RECEIVABLES LLC,
Transferor,
NORDSTROM fsb,
Servicer,
▇▇▇▇▇ FARGO BANK MINNESOTA, NATIONAL ASSOCIATION,
Indenture Trustee,
and
NORDSTROM CREDIT CARD MASTER NOTE TRUST,
Issuer
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TRANSFER AND SERVICING AGREEMENT
Dated as of April 1, 2002
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TABLE OF CONTENTS
Page
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ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions................................................................................... 1
Section 1.02. Other Definitional Provisions................................................................. 15
ARTICLE TWO
CONVEYANCE OF RECEIVABLES
Section 2.01. Conveyance of Receivables..................................................................... 16
Section 2.02. Acceptance by Trust........................................................................... 18
Section 2.03. Corporate Representations and Warranties of Each Transferor................................... 18
Section 2.04. Other Representations and Warranties of Each Transferor....................................... 20
Section 2.05. Reassignment of Ineligible Receivables........................................................ 22
Section 2.06. Reassignment of Trust Portfolio............................................................... 23
Section 2.07. Covenants of each Transferor.................................................................. 24
Section 2.08. Covenants of each Transferor with Respect to Receivables Purchase Agreements.................. 26
Section 2.09. Addition of Accounts.......................................................................... 27
Section 2.10. Removal of Accounts and Participation Interests............................................... 30
Section 2.11. Account Allocations........................................................................... 31
Section 2.12. Discount Option............................................................................... 32
Section 2.13. Representations and Warranties as to the Security Interest of the Trust in the Receivables.... 32
ARTICLE THREE
ADMINISTRATION AND SERVICING OF RECEIVABLES
Section 3.01. Acceptance of Appointment and Other Matters Relating to the Servicer.......................... 34
Section 3.02. Servicing Compensation........................................................................ 35
Section 3.03. Representations, Warranties and Covenants of the Servicer..................................... 36
Section 3.04. Reports and Records for the Owner Trustee and the Indenture Trustee........................... 38
Section 3.05. Annual Certificate of Servicer................................................................ 39
Section 3.06. Annual Servicing Report of Independent Public Accountants; Copies of Reports Available........ 39
Section 3.07. Tax Treatment................................................................................. 40
Section 3.08. Notices to Nordstrom fsb...................................................................... 40
Section 3.09. Adjustments................................................................................... 40
Section 3.10. Reports to the Commission..................................................................... 41
Section 3.11. Reports to Rating Agencies.................................................................... 41
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ARTICLE FOUR
OTHER TRANSFEROR MATTERS
Page
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Section 4.01. Liability of each Transferor.................................................................. 42
Section 4.02. Merger or Consolidation of, or Assumption of the Obligations of, a Transferor................. 42
Section 4.03. Limitations on Liability of Each Transferor................................................... 43
ARTICLE FIVE
OTHER MATTERS RELATING TO THE SERVICER
Section 5.01. Liability of the Servicer..................................................................... 44
Section 5.02. Merger or Consolidation of, or Assumption of the Obligations of, the Servicer................. 44
Section 5.03. Limitation on Liability of the Servicer and Others............................................ 44
Section 5.04. Servicer Indemnification of the Trust and the Trustees........................................ 45
Section 5.05. Resignation of the Servicer................................................................... 45
Section 5.06. Access to Certain Documentation and Information Regarding the Receivables..................... 46
Section 5.07. Delegation of Duties.......................................................................... 46
Section 5.08. Examination of Records........................................................................ 46
ARTICLE SIX
INSOLVENCY EVENTS
Section 6.01. Rights upon the Occurrence of an Insolvency Event............................................. 47
ARTICLE SEVEN
SERVICER DEFAULTS
Section 7.01. Servicer Defaults............................................................................. 48
Section 7.02. Indenture Trustee To Act; Appointment of Successor............................................ 50
Section 7.03. Notification to Noteholders................................................................... 52
ARTICLE EIGHT
TERMINATION
Section 8.01. Termination of Agreement...................................................................... 53
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ARTICLE NINE
MISCELLANEOUS PROVISIONS
Page
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Section 9.01. Amendment; Waiver of Past Defaults............................................................ 54
Section 9.02. Waiver of Transferor or Servicer Defaults..................................................... 55
Section 9.03. Protection of Right, Title and Interest to Trust Assets....................................... 55
Section 9.04. GOVERNING LAW................................................................................. 56
Section 9.05. Notices; Payments............................................................................. 57
Section 9.06. Severability of Provisions.................................................................... 57
Section 9.07. Further Assurances............................................................................ 57
Section 9.08. No Waiver; Cumulative Remedies................................................................ 57
Section 9.09. Counterparts.................................................................................. 58
Section 9.10. Third-Party Beneficiaries..................................................................... 58
Section 9.11. Actions by Noteholders........................................................................ 58
Section 9.12. Rule 144A Information......................................................................... 58
Section 9.13. Merger and Integration........................................................................ 58
Section 9.14. Headings...................................................................................... 58
Section 9.15. Assignment.................................................................................... 58
Section 9.16. Nonpetition Covenant.......................................................................... 59
Section 9.17. Limitation of Liability....................................................................... 59
EXHIBITS
EXHIBIT A Form of Assignment of Receivables in Additional Accounts................................ A-1
EXHIBIT B Form of Reassignment of Receivables in Removed Accounts................................. B-1
EXHIBIT C Form of Annual Servicer's Certificate................................................... ▇-▇
▇▇▇▇▇▇▇ ▇-▇ Form of Opinion of Counsel with Respect to Amendments................................... ▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇ Form of Opinion of Counsel with Respect to Accounts..................................... ▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇ Provisions to be Included in Annual Opinion of Counsel.................................. D-3-1
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TRANSFER AND SERVICING AGREEMENT
This Transfer and Servicing Agreement, dated as of April 1, 2002, is
between Nordstrom Credit Card Receivables LLC, a Delaware limited liability
company, as Transferor (the "Transferor"), Nordstrom fsb, as Servicer (the
"Servicer"), Nordstrom Credit Card Master Note Trust, a Delaware business trust,
as Issuer (the "Issuer") and ▇▇▇▇▇ Fargo Bank Minnesota, National Association, a
national banking association, as Indenture Trustee (the "Indenture Trustee").
In consideration of the mutual agreements herein contained, each party
agrees as follows for the benefit of the other parties, the Noteholders and any
Series Enhancer (as such capitalized terms are defined below) to the extent
provided herein, in the Master Indenture and in any Indenture Supplement:
ARTICLE One
DEFINITIONS
Section 1.01. Definitions. Whenever used in this Agreement, the
following words and phrases shall have the following meanings, and the
definitions of such terms are applicable to the singular as well as the plural
forms of such terms and to the masculine as well as to the feminine and neuter
genders of such terms.
"Account" means each (i) Initial Account, (ii) Additional Account (but
only from and after the Addition Date with respect thereto), (iii) Related
Account and (iv) Transferred Account, but shall exclude any Account all the
Receivables in which are either: (a) after the Removal Date, Removed Accounts or
Removed Participation Interests, (b) Ineligible Receivables reassigned to the
Transferor pursuant to Section 2.05 or (c) Servicer Repurchase Receivables
assigned and transferred to the Servicer pursuant to Section 3.03.
"Account Originator" means Nordstrom fsb or, upon satisfaction of the
Rating Agency Condition, any other entity which is the issuer of the credit card
relating to an Account pursuant to a Credit Card Agreement.
"Account Owner" means the Account Originator relating to an Account or
any Person who has acquired such Account and has sold the related Receivables to
the Transferor pursuant to a Receivables Purchase Agreement.
"Addition" means the designation of (i) additional Eligible Accounts to
be included as Accounts or (ii) Participation Interests to be included as Trust
Assets, in each case pursuant to Section 2.09(a) or (b).
"Addition Cut-Off Date" means, with respect to any Additional Accounts
or Participation Interests to be included in the Trust, the date on which such
Additional Accounts are designated for inclusion in the Trust.
"Addition Date" means, with respect to (i) Additional Accounts, the
date on which the Receivables in such Additional Accounts are conveyed to the
Trust and (ii) Participation
Interests, the date from and after which such Participation Interests are to be
included as Trust Assets, in each case pursuant to Section 2.09(a) or (b).
"Additional Account" means each VISA(R) or other retail consumer
revolving credit card account established pursuant to a Credit Card Agreement,
and designated pursuant to Section 2.09(a) or (b) to be included as an Account.
"Additional Transferors" means Affiliates of the Transferor designated
by the Transferor to be included as Transferors pursuant to Section 2.09(d).
"Adverse Effect" means, with respect to any action, that such action
will (i) result in the occurrence of a Redemption Event or an Event of Default
or (ii) materially and adversely affect the amount or timing of distributions to
be made to the Noteholders of any Series or Class pursuant to this Agreement,
the Master Indenture or the related Indenture Supplement.
"Affiliate" means, with respect to any specified Person, any other
Person controlling or controlled by or under common control with such specified
Person. For the purposes of this definition, "control" means the power to direct
the management and policies of a Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing.
"Agreement" means this Transfer and Servicing Agreement, as the same
may be amended, supplemented or otherwise modified from time to time.
"Appointment Date" means the day on which an Insolvency Event occurs
with respect to the Transferor.
"Assignment" means an Assignment of Receivables in Additional Accounts,
in substantially the form of Exhibit A.
"Authorized Newspaper" means any major newspaper or newspapers of
general circulation in the Borough of Manhattan, The City of New York, printed
in the English language (and, with respect to any Series or Class, if and so
long as the Notes of such Series are (i) listed on the Luxembourg Stock Exchange
and such Exchange shall so require, in Luxembourg, printed in any language
satisfying the requirements of such Exchange or (ii) Bearer Notes, in such place
as may be specified in the applicable Indenture Supplement) and customarily
published on each business day at such place, whether or not published on
Saturdays, Sundays or holidays.
"Bearer Notes" has the meaning set forth in the Master Indenture.
"Business Day" means any day other than (i) a Saturday or Sunday or
(ii) any other day on which national banking associations or state banking
institutions in Arizona, Colorado, Minnesota, New York, Delaware or any other
state in which the principal executive offices of Nordstrom fsb, the Owner
Trustee, the Indenture Trustee or other Account Owner, as the case may be, are
located, are authorized or obligated by law, executive order or governmental
decree to be closed or (iii) for purposes of any particular Series, any other
day specified in the related Indenture Supplement.
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"Cash Advance Fees" means cash advance transaction fees and cash
advance late fees, if any, as specified in the Credit Card Agreement applicable
to each Account.
"Certificateholder" or "Holder" means each holder of a Transferor
Certificate.
"Class" has the meaning set forth in the Master Indenture.
"Closing Date" means, with respect to any Series, the closing date
specified in the related Indenture Supplement.
"Collections" means all payments by or on behalf of Obligors (including
Insurance Proceeds) received in respect of the Receivables, in the form of cash,
checks, wire transfers, electronic transfers, ATM transfers or any other form of
payment in accordance with a Credit Card Agreement in effect from time to time
and all other amounts specified by this Agreement, the Master Indenture or any
Indenture Supplement as constituting Collections. As specified in any
Participation Interest Supplement or Indenture Supplement, Collections shall
include amounts received with respect to Participation Interests. All Recoveries
with respect to Receivables previously charged off as uncollectible will be
treated as Collections of Finance Charge Receivables. Collections with respect
to any Monthly Period shall include a portion, calculated pursuant to Section
2.07(h), of Interchange paid to the Trust with respect to such Monthly Period,
to be applied as if such amount were Collections of Finance Charge Receivables
for all purposes.
"Commission" has the meaning set forth in the Master Indenture.
"Continued Errors" has the meaning set forth in Section 7.02(e).
"Contractually Delinquent" with respect to an Account, means an Account
as to which the required minimum payment set forth on the related billing
statement has not been received by the due date thereof.
"Corporate Trust Office" has the meaning when used in respect of (i)
the Owner Trustee, specified in the Trust Agreement and (ii) the Indenture
Trustee, specified in the Master Indenture.
"Coupon" has the meaning set forth in the Master Indenture.
"Credit Card Agreement" means, with respect to VISA(R) revolving credit
card accounts or other retail revolving consumer credit card accounts
subsequently conveyed to the Trust, the agreements between an Account Owner and
the Obligor governing the terms and conditions of such account, as such
agreements may be amended, modified or otherwise changed from time to time and
as distributed (including any amendments and revisions thereto) to holders of
such account.
"Credit Card Guidelines" means the written policies and procedures of
the Servicer, the Transferor or any other Account Owner, as the case may be,
relating to the operation of its consumer revolving lending business as they
pertain to VISA(R) credit card accounts or other retail revolving consumer
credit card accounts subsequently conveyed to the Trust, which are
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consistent with prudent practice, including, the written policies and procedures
for determining the creditworthiness of credit card account customers, the
extension of credit to credit card account customers and relating to the
maintenance of credit card accounts and collection of receivables with respect
thereto, as such policies and procedures may be amended, modified or otherwise
changed from time to time.
"Date of Processing" means, with respect to any transaction or receipt
of Collections, the date on which such transaction is first recorded on the
Servicer's computer file of revolving credit card accounts (without regard to
the effective date of such recordation).
"Defaulted Receivables" means, with respect to any Monthly Period, all
Principal Receivables which are charged off as uncollectible in such Monthly
Period in accordance with the Credit Card Guidelines and the Servicer's
customary and usual servicing procedures for servicing VISA(R) or other retail
consumer revolving credit account receivables comparable to the Receivables
(excluding any servicing procedures applicable to receivables arising in Secured
Accounts). A Principal Receivable shall become a Defaulted Receivable on the day
on which such Principal Receivable is recorded as charged off on the Servicer's
computer master file of consumer revolving credit card accounts but, in any
event, shall be deemed a Defaulted Receivable no later than the month following
the day the related Account becomes 151 days Contractually Delinquent unless the
Obligor cures such default by making a partial payment which satisfies the
criteria for curing delinquencies set forth in the applicable Credit Card
Guidelines.
"Determination Date" means, with respect to any Series, the date
specified in the applicable Indenture Supplement.
"Dilution Amount" means the amount by which the Servicer is required to
adjust the amount of Principal Receivables used to calculate the Transferor
Interest pursuant to the first two sentences of Section 3.09.
"Discount Option Date" means, initially the Closing Date and
thereafter, each date on which an increase, withdrawal or reduction of the
Discount Percentage takes effect, as designated by the Transferor pursuant to
Section 2.12 of the Transfer and Servicing Agreement.
"Discount Option Receivable Collections" means on any Date of
Processing, the product of (i) a fraction the numerator of which is the
aggregate amount of Discount Option Receivables and the denominator of which is
the sum of the aggregate amount of Principal Receivables and the aggregate
amount of Discount Option Receivables, in each case at the end of the prior Date
of Processing and (ii) Collections of Principal Receivables on such Date of
Processing prior to any reduction for Finance Charge Receivables which are
Discount Option Receivables received on such Date of Processing.
"Discount Option Receivables" means Principal Receivables (or a
specified portion thereof) existing on or after the Discount Option Date
designated by the Transferor as being treated as Finance Charge Receivables
pursuant to Section 2.12(a). The aggregate amount of Discount Option
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Receivables outstanding on any Date of Processing occurring on or after the
Discount Option Date shall equal the sum of (i) the aggregate amount of Discount
Option Receivables at the end of the prior Date of Processing (which amount,
prior to the Discount Option Date, shall be zero) plus (ii) the aggregate amount
of any new Discount Option Receivables created on such Date of Processing minus
(iii) any Discount Option Receivables Collections received on such Date of
Processing. Discount Option Receivables created on any Date of Processing means
the product of the amount of any Principal Receivables created on such Date of
Processing prior to any reduction for Finance Charge Receivables which are
Discount Option Receivables received on such Date of Processing and the Discount
Percentage.
"Discount Percentage" means 1.0% initially and such other percentage
the Transferor may designate pursuant to Section 2.12(a).
"Distribution Date" means, with respect to any Series, the date
specified in the applicable Indenture Supplement.
"Dollars", "$" or "U.S. $" means United States dollars.
"Early Accumulation Period" has the meaning, with respect to any
Series, specified in the related Indenture Supplement.
"Eligible Account" means a consumer revolving credit card account owned
by an Account Owner identified by the Transferor as of (i) the Initial Cut-Off
Date, in the case of the Initial Accounts or (ii) the applicable Addition
Cut-Off Date, in the case of the Additional Accounts, as having the following
characteristics:
(a) has not been cancelled and is in existence and maintained
by the applicable Account Owner;
(b) is payable in Dollars;
(c) except as provided below, has not been identified as an
Account the credit card or cards with respect to which have been
reported to the applicable Account Owner as having been lost or stolen
or has an Obligor who has not been identified as deceased;
(d) except as provided below, does not have any Receivables
which are Defaulted Receivables;
(e) has at no time been a Secured Account;
(f) except as provided below, does not have any Receivables
which have been identified by the applicable Account Owner or the
relevant Obligor as having been incurred as a result of fraudulent use
of any related credit card;
(g) except as provided below, the Obligor of which has not
been identified by the Servicer in its computer files as having been
declared bankrupt;
(h) is a VISA(R)account originated by the Bank or, subject to
satisfaction of the Rating Agency Condition, other retail revolving
credit card account;
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(i) was created in accordance with the Credit Card Guidelines
or if the Account Owner is not the applicable Account Originator, in
accordance with the underwriting guidelines of the Account Originator,
in either case at the time of creation of such Account;
(j) does not have outstanding Receivables which have been sold
or pledged by the related Account Owner to any party other than the
Transferor pursuant to a Receivables Purchase Agreement; and
(k) does not have outstanding Receivables that give rise to
any claim of any governmental agency including, without limitation, the
government of the United States or any State thereof or any agency,
instrumentality or department thereof.
Eligible Accounts may include Accounts, the Receivables of which have
been written off, or with respect to which the Transferor believes the related
Obligor is bankrupt, or as to which certain Receivables have been identified by
the Obligor as having been incurred as a result of fraudulent use of any credit
cards, or as to which any credit cards have been reported to the Account Owner
or the Servicer as lost or stolen, in each case as of the Initial Cut-Off Date,
with respect to the Initial Accounts, and as of the related Addition Cut-Off
Date, with respect to the Additional Accounts; provided that (i) the balance of
all Receivables included in such Accounts is reflected on the books and records
of the Account Owner (and is treated for purposes of this Agreement) as "zero",
and (ii) charging privileges with respect to all such Accounts have been
canceled in accordance with the relevant Credit Card Guidelines.
"Eligible Investments" has the meaning set forth in the Master
Indenture.
"Eligible Receivable" means each Receivable, including, where
applicable, the underlying receivable:
(a) which has arisen in an Eligible Account;
(b) which was created in compliance in all material respects
with all Requirements of Law applicable to the institution which owned
such Receivable at the time of its creation and pursuant to a Credit
Card Agreement which complies in all material respects with all
Requirements of Law applicable to the Account Originator or Account
Owner, as the case may be;
(c) with respect to which all material consents, licenses,
approvals or authorizations of, or registrations or declarations with,
any Governmental Authority required to be obtained, effected or given
in connection with the creation of such Receivable or the execution,
delivery and performance by the applicable Account Originator and any
subsequent Account Owner of its obligations, if any, under the related
Credit Card Agreement pursuant to which such Receivable was created,
have been duly obtained, effected or given and are in full force and
effect;
(d) as to which at the time of the transfer of such Receivable
to the Trust, the Transferor or the Trust will have good and marketable
title thereto, free and clear of all Liens (other than any Lien for
municipal or other local taxes if such taxes are not then
6
due and payable or if the Transferor is then contesting the validity
thereof in good faith by appropriate proceedings and has set aside on
its books adequate reserves with respect thereto);
(e) which has been the subject of either a valid transfer and
assignment from the Transferor to the Trust of all the Transferor's
right, title and interest therein (including any proceeds thereof), or
the grant of a first priority perfected security interest therein (and
in the proceeds thereof), effective until the termination of the Trust;
(f) which at all times will be the legal, valid and binding
payment obligation of the related Obligor 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);
(g) which, at the time of transfer to the Trust, has not been
waived or modified except as permitted in accordance with the Credit
Card Guidelines and which waiver or modification is reflected in the
Servicer's computer file of revolving credit card accounts;
(h) which, at the time of transfer to the Trust, is not
subject to any right of rescission, setoff, counterclaim or any other
defense (including defenses arising out of violations of usury laws) of
the Obligor, other than defenses arising out of applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws 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 equity) or as to which the Servicer is
required by Section 3.09 to make an adjustment;
(i) as to which, at the time of transfer to the Trust, the
relevant Account Originator and any subsequent Account Owner has
satisfied all of its obligations required to be satisfied by such time;
(j) as to which, at the time of transfer to the Trust, none of
the Transferor, the Bank, or any other Account Owner, as the case may
be, has taken any action which would impair, or omitted to take any
action the omission of which would impair, the rights of the Trust or
the Noteholders therein;
(k) that does not cause the aggregate amount of Receivables
that arises from Accounts that have Obligors with a billing address
outside the United States and its territories to be more than 1.0% of
total amount of Receivables in the Trust;
(l) that does not cause the aggregate amount of Receivables
that arise from Accounts the Obligors for which are employees of
Nordstrom or its affiliates to be more than 6.0% of the total amount of
Receivables in the Trust; and
(m) which constitutes an "account" under and as defined in
Article 9 of the UCC in effect in the State of Delaware and any other
State where the filing of a financing
7
statement is required to perfect the Trust's interest in the
Receivables and the proceeds thereof.
"Eligible Servicer" means the Indenture Trustee or, if the Indenture
Trustee is not acting as Servicer, an entity which, at the time of its
appointment as Servicer, (i) is servicing a portfolio of revolving credit card
accounts, (ii) is legally qualified and has the capacity to service the
Accounts, (iii) has demonstrated the ability to service professionally and
competently a portfolio of similar accounts in accordance with high standards of
skill and care, (iv) is qualified to use the software that is then being used to
service the Accounts or obtains the right to use or has its own software which
is adequate to perform its duties under this Agreement and (v) has a net worth
of at least $50,000,000 as of the end of its most recent fiscal quarter.
"Enhancement Agreement" has the meaning set forth in the Master
Indenture.
"Errors" has the meaning set forth in Section 7.02(e).
"Event of Default" has the meaning set forth in the Master Indenture.
"Excess Reserve Account Investment Earnings" has the meaning specified
in the related Indenture Supplement.
"Exchange Act" has the meaning set forth in the Master Indenture.
"FDIC" means the Federal Deposit Insurance Corporation, and its
successors.
"Finance Charge Receivables" means all amounts billed to the Obligors
on any Account in respect of all (i) Periodic Rate Finance Charges, (ii) Cash
Advance Fees, (iii) annual membership fees and annual service charges, (iv) Late
Fees, (v) Overlimit Fees, (vi) Discount Option Receivables, (vii) the interest
portion of Participation Interests as shall be determined pursuant to, and only
if so provided in, the applicable Participation Interest Supplement or Indenture
Supplement for any Series, (viii) Recoveries, (ix) Excess Reserve Account
Investment Earnings and (x) Interchange.
"Fitch" means Fitch, Inc. and its successors.
"GAAP" means generally accepted accounting principles.
"Governmental Authority" means the United States, any State or other
political subdivision thereof and any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government.
"Indenture" means the Master Indenture, as supplemented by the related
Indenture Supplement, as the same may be amended, supplemented or otherwise
modified from time to time.
"Indenture Collateral" has the meaning set forth in Section 2.01.
"Indenture Supplement" has the meaning set forth in the Master
Indenture.
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"Indenture Trustee" means ▇▇▇▇▇ Fargo Bank Minnesota, National
Association, and its successors, in its capacity as trustee under the Master
Indenture, its successors in interest and any successor indenture trustee under
the Master Indenture.
"Ineligible Receivables" has the meaning set forth in Section 2.05(a).
"Initial Account" means each VISA credit card account established
pursuant to a Credit Card Agreement between the applicable Account Owner and any
Person, which account is identified in the computer file or microfiche list
delivered to the Owner Trustee by the Transferor pursuant to Section 2.01 on the
Initial Issuance Date.
"Initial Cut-Off Date" means February 28, 2002.
"Initial Issuance Date" means May 1, 2002, the date the Transferor's
Certificate is delivered by the Trust to the Transferor pursuant to the Trust
Agreement.
"Insolvency Event" has the meaning set forth in Section 6.01.
"Insurance Proceeds" means any amounts received pursuant to the payment
of benefits under any credit life insurance policies, credit disability or
unemployment insurance policies covering any Obligor with respect to Receivables
under such Obligor's Account.
"Interchange" means certain fees received by Nordstrom fsb, or any
other Account Owner, in its capacity as credit card issuing bank, from the VISA
U.S.A., Inc. or any other retail credit card association for which the retail
credit card receivables have been added to the Trust, as partial compensation
for taking credit risk, absorbing fraud losses and funding receivables for a
limited period prior to initial billing.
"Invested Amount" means, with respect to any Series and for any date,
an amount equal to the invested amount or adjusted invested amount, as
applicable, specified in the related Indenture Supplement.
"Investor Percentage" means, with respect to any Series, the investor
percentage for such Series specified in the related Indenture Supplement.
"Issuer" means Nordstrom Credit Card Master Note Trust or its
successors.
"Late Fees" has the meaning set forth in the Credit Card Agreement
applicable to each Account for late fees or similar terms.
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit arrangement, equity interest, encumbrance, lien (statutory
or other), preference, participation interest, priority or other security
agreement or preferential arrangement of any kind or nature whatsoever,
including any conditional sale or other title retention agreement, any financing
lease having substantially the same economic effect as any of the foregoing and
the filing of any financing statement under the UCC or comparable law of any
jurisdiction to evidence any of the foregoing; provided, however, that any
assignment permitted by Section 3.06(b) of the Trust
9
Agreement or Section 4.02 hereof, and the lien created by this Agreement shall
not be deemed to constitute a Lien.
"Master Indenture" means the Master Indenture, dated as of April 1,
2002, between the Issuer and the Indenture Trustee, as the same may be amended,
supplemented or otherwise modified from time to time.
"Monthly Period" has the meaning set forth in the Master Indenture.
"Monthly Servicing Fee" means, with respect to any Series and any
Monthly Period, the portion of the Servicing Fee for such Monthly Period
allocable to such Series.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc., and its successors.
"Note Interest Rate" has the meaning set forth in the Master Indenture.
"Note Owner" has the meaning set forth in the Master Indenture.
"Note Register" has the meaning set forth in the Master Indenture.
"Noteholder" or "Holder" has the meaning set forth in the Master
Indenture.
"Notices" means all demands, notices, instructions, directions and
communications under this Agreement.
"Obligor" means, with respect to any Account, the Person or Persons
obligated to make payments with respect to such Account, including any guarantor
thereof, but excluding any merchant.
"Officer's Certificate" has the meaning set forth in the Master
Indenture.
"Opinion of Counsel" has the meaning set forth in the Master Indenture.
"Overlimit Fees" has the meaning set forth in the Credit Card Agreement
applicable to each Account for overlimit fees or similar terms if such fees are
provided for with respect to such Account.
"Owner Trustee" means Wilmington Trust Company, not in its individual
capacity, but solely as owner trustee under the Trust Agreement, its successors
in interest and any successor owner trustee under the Trust Agreement.
"Participating Transferor" means each Transferor who (i) owns any
Additional Account the Receivables in which shall be transferred to the Trust on
an Addition Date or (ii) is transferring a Participation Interest to the Trust
on an Addition Date.
"Participation Interest Supplement" means a supplement to this
Agreement entered into pursuant to Section 2.09(a)(ii) or (b) in connection with
the conveyance of Participation Interests to the Trust.
10
"Participation Interests" has the meaning set forth in Section
2.09(a)(ii).
"Paying Agent" has the meaning set forth in the Master Indenture.
"Periodic Rate Finance Charges" has the meaning set forth in the Credit
Card Agreement applicable to each Account for finance charges (due to periodic
rate) or any similar term.
"Person" means any legal person, including any individual, corporation,
limited liability company, partnership, joint venture, association, joint-stock
company, trust, unincorporated organization, governmental entity or other entity
of any nature.
"Portfolio Yield" has the meaning set forth in the related Indenture
Supplement.
"Predecessor Servicer Work Product" has the meaning set forth in
Section 7.02(e).
"Principal Funding Account" has the meaning, with respect to any
Series, specified in the related Indenture Supplement.
"Principal Funding Account Balance" has the meaning, with respect to
any Series, specified in the related Indenture Supplement.
"Principal Receivables" means all Receivables other than Finance Charge
Receivables or Defaulted Receivables; provided, however, that after the Discount
Option Date, Principal Receivables on any Date of Processing thereafter means
Principal Receivables as otherwise determined pursuant to this definition minus
the amount of any Discount Option Receivables. Principal Receivables shall also
include the principal portion of Participation Interests as shall be determined
pursuant to, and only if so provided in, the applicable Participation Interest
Supplement or Indenture Supplement for any Series. In calculating the aggregate
amount of Principal Receivables on any day, the amount of Principal Receivables
shall be reduced by the aggregate amount of credit balances in the Accounts on
such day. Any Principal Receivables which the Transferor is unable to transfer
as provided in Section 2.11 shall not be included in calculating the amount of
Principal Receivables.
"Rating Agency" has the meaning set forth in the Master Indenture.
"Rating Agency Condition" has the meaning set forth in the Master
Indenture.
"Reassignment" means a Reassignment of Receivables in Removed Accounts,
in substantially the form of Exhibit B.
"Receivables" means all amounts shown on the Servicer's records as
amounts payable by Obligors on any Account from time to time, including amounts
payable for Principal Receivables and Finance Charge Receivables. Receivables
which become Defaulted Receivables will cease to be included as Receivables as
of the day on which they become Defaulted Receivables.
"Receivables Purchase Agreement" means (i) the receivables purchase
agreement, dated as of April 1, 2002, between Nordstrom fsb, as seller, and
Nordstrom Credit Card Receivables LLC, as purchaser, as the same may be amended,
supplemented or otherwise modified from time
11
to time or (ii) any receivables purchase agreement entered into between the
Transferor and an Account Owner, as the same may be amended, supplemented or
otherwise modified from time to time.
"Recoveries" means all amounts received (net of out-of-pocket costs of
collection) including Insurance Proceeds, which are reasonably estimated by the
Servicer to be attributable to Defaulted Receivables, including the net proceeds
of any sale of such Defaulted Receivables by the Transferor or the Servicer.
"Redemption Event" has the meaning set forth in the Master Indenture.
"Registered Notes" has the meaning set forth in the Master Indenture.
"Related Account" means an Account with respect to which a new credit
account number has been issued by the applicable Account Owner or Servicer or
the applicable Transferor under circumstances resulting from a lost or stolen
credit card and not requiring standard application and credit evaluation
procedures under the Credit Card Guidelines.
"Removal Date" means the date specified by the Transferor for removal
of Removed Accounts and Removed Participation Interest.
"Removed Accounts" has the meaning set forth in Section 2.10(a).
"Removed Participation Interests" has the meaning set forth in Section
2.10(a).
"Required Designation Date" has the meaning set forth in Section
2.09(a)(i).
"Required Minimum Principal Balance" means, unless otherwise provided
in an Indenture Supplement relating to any Series, as of any date of
determination, an amount equal to the sum of the numerators used in the
calculation of the Investor Percentages with respect to Principal Receivables
for all outstanding Series on such date; provided that with respect to any
Series in its Early Accumulation Period or such other period as designated in
the related Indenture Supplement with an Invested Amount as of such date of
determination equal to the Principal Funding Account Balance relating to such
Series taking into account the Principal Funding Account Balance relating to
such Series on deposit in the Principal Funding Account on such date of
determination, the numerator used in the calculation of the Investor Percentage
with respect to Principal Receivables relating to such Series shall, solely for
the purpose of the definition of Required Minimum Principal Balance, be deemed
to equal zero.
"Required Transferor Interest" has the meaning set forth in the Master
Indenture.
"Requirements of Law" means any law, treaty, rule or regulation, or
determination of an arbitrator or Governmental Authority, whether federal, state
or local (including usury laws, the Federal Truth in Lending Act and Regulation
B and Regulation Z of the Board of Governors of the Federal Reserve System),
and, when used with respect to any Person, the certificate of incorporation and
by-laws or other organizational or governing documents of such Person.
12
"Secured Account" means any Account for which the related Obligor has
pledged assets or made a cash collateral deposit as security for payment of the
Receivables arising in such Account.
"Seller" has the meaning set forth in the Master Indenture.
"Series" has the meaning set forth in the Master Indenture.
"Series Account" has the meaning set forth in the Master Indenture.
"Series Enhancement" has the meaning set forth in the Master Indenture.
"Series Enhancer" has the meaning set forth in the Indenture.
"Service Transfer" has the meaning set forth in Section 7.01.
"Servicer" means Nordstrom fsb, in its capacity as Servicer pursuant to
this Agreement, and, after any Service Transfer, the Successor Servicer.
"Servicer Default" has the meaning set forth in Section 7.01(a).
"Servicer Repurchase Receivables" has the meaning set forth in Section
3.03(b).
"Servicing Fee" means the servicing fee payable to the Servicer in
respect of each Monthly Period pursuant to Section 3.02 in an amount equal to
one-twelfth of the product of (i) the weighted average of the Servicing Fee
Rates with respect to each outstanding Series (based upon the Servicing Fee Rate
for each Series and the Invested Amount (or such other amount as specified in
the related Indenture Supplement) of such Series, in each case as of the last
day of the prior Monthly Period) and (ii) the amount of Principal Receivables on
the last day of the prior Monthly Period prior to the termination of the Trust
pursuant to Section 8.01 of the Trust Agreement.
"Servicing Fee Rate" means, with respect to any Series, the servicing
fee rate specified in the related Indenture Supplement.
"Special Funding Account" has the meaning set forth in the Master
Indenture.
"Special Funding Amount" has the meaning set forth in the Master
Indenture.
"Standard & Poor's" means Standard & Poor's Ratings Services, a
Division of The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc., and its successors.
"State" has the meaning set forth in the Master Indenture.
"Successor Servicer" has the meaning set forth in Section 7.02(a).
"Supplemental Accounts" means Additional Accounts that the Transferor
designates as Accounts pursuant to Sections 2.09(a)(i) and 2.09(b).
13
"Supplemental Certificate" has the meaning set forth in the Trust
Agreement.
"Tax Opinion" has the meaning set forth in the Master Indenture.
"Termination Notice" has the meaning set forth in Section 7.01.
"Transaction Documents" has the meaning set forth in the Master
Indenture.
"Transfer Agent and Registrar" has the meaning set forth in the Master
Indenture.
"Transfer Restriction Event" means, with respect to a Transferor, that
such Transferor unable for any reason to transfer Receivables to the Trust
pursuant to this Agreement, including by reason of the application of the
provisions of Section 6.01 or any order of any Governmental Authority or, with
respect to the Bank, the Bank is unable for any reason to transfer Receivables
to the Trust pursuant to the Receivables Purchase Agreement.
"Transferor" means (i) Nordstrom Credit Card Receivables LLC, or its
successor under this Agreement and (ii) any Additional Transferor.
"Transferor Certificates" has the meaning set forth in the Trust
Agreement.
"Transferor Interest" has the meaning set forth in the Master
Indenture.
"Transferred Account" means each account into which an Account shall be
transferred; provided, that (i) such transfer was made in accordance with the
Credit Card Guidelines and (ii) such account can be traced or identified as an
account into which an Account has been transferred.
"Trust" means the Nordstrom Credit Card Master Note Trust.
"Trust Agreement" means the Trust Agreement, dated as of April 1, 2002,
between Nordstrom Credit Card Receivables LLC and the Owner Trustee, as the same
may be amended, supplemented or otherwise modified from time to time.
"Trust Assets" has the meaning set forth in Section 2.01.
"Trust Termination Date" has the meaning set forth in the Trust
Agreement.
"Trustees" means the Owner Trustee and the Indenture Trustee.
"UCC" means the Uniform Commercial Code, as amended from time to time,
as in effect in the applicable jurisdiction.
"United States" has the meaning set forth in the Master Indenture
"▇▇▇▇▇ Fargo" means ▇▇▇▇▇ Fargo Bank Minnesota, National Association,
and its successors.
14
Section 1.02. Other Definitional Provisions.
(a) With respect to any Series, all terms used herein and not otherwise
defined herein shall have meanings ascribed to them in the Trust Agreement, the
Master Indenture or the related Indenture Supplement, as applicable.
(b) All terms defined in this Agreement shall have the defined meanings
when used in any certificate or other document made or delivered pursuant hereto
unless otherwise defined therein.
(c) As used in this Agreement and in any certificate or other document
made or delivered pursuant hereto or thereto, accounting terms not defined in
this Agreement or in any such certificate or other document, and accounting
terms partly defined in this Agreement or in any such certificate or other
document to the extent not defined, shall have the respective meanings given to
them under GAAP. To the extent that the definitions of accounting terms in this
Agreement or in any such certificate or other document are inconsistent with the
meanings of such terms under GAAP, the definitions contained in this Agreement
or in any such certificate or other document shall control.
(d) Any reference to each Rating Agency shall only apply to any
specific rating agency if such rating agency is then rating any outstanding
Series.
(e) Unless otherwise specified, references to any amount as on deposit
or outstanding on any particular date means such amount at the close of business
on such day.
(f) For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, (i) terms used herein
include, as appropriate, all genders and the plural as well as the singular,
(ii) references to this Agreement include all Exhibits hereto, (iii) references
to words such as "herein", "hereof" and the like shall refer to this Agreement
as a whole and not to any particular part, Article or Section within this
Agreement, (iv) references to an Article or Section such as "Article One" or
"Section 1.01" and the like shall refer to the applicable Article or Section of
this Agreement, (v) the term "include" and all variations thereof shall mean
"include without limitation", (vi) the term "or" shall include "and/or" and
(vii) the term "proceeds" shall have the meaning ascribed to such term in the
UCC.
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ARTICLE TWO
CONVEYANCE OF RECEIVABLES
Section 2.01. Conveyance of Receivables. By execution of this
Agreement, Nordstrom Credit Card Receivables LLC or, if applicable, any
Additional Transferor, does hereby transfer, assign, set over and otherwise
convey to the Trust, without recourse except as provided herein, all its right,
title and interest in, to and under (i) the Receivables existing at the close of
business on the Initial Cut-Off Date, in the case of Receivables arising in the
Initial Accounts, and on each Addition Cut-Off Date, in the case of Receivables
arising in the Additional Accounts, and in each case thereafter created from
time to time until the termination of the Trust, (ii) Collections and all
Interchange and Recoveries allocable to the Trust as provided herein and all
monies due or to become due and all amounts received or receivable with respect
thereto (including proceeds of the reassignment of the Receivables to the
Transferor pursuant to Section 2.05(a) or 2.06), (iii) all Eligible Investments
and all monies, investment properties, instruments and other property credited
to the Collection Account, the Series Accounts and the Special Funding Account
(including any subaccount of any such account), and all interest, dividends,
earnings, income and other distributions from time to time received, receivable
or otherwise distributed or distributable thereto or in respect thereof
(including any accrued discount realized on liquidation of any investment
purchased at a discount), (iv) all rights, remedies powers, privileges and
claims of the Transferor under or with respect to any Series Enhancement, the
rights of the Transferor under this Agreement and the Trust Agreement with
respect to any Series (whether arising pursuant to the terms of such Enhancement
Agreement, the Trust Agreement or this Agreement or otherwise available to the
Transferor at law or in equity), including the rights of the Transferor to
enforce such Enhancement Agreement, the Trust Agreement or this Agreement, and
to give or withhold any and all consents, requests, notices, directions,
approvals, extensions or waivers under or with respect to such Series
Enhancement, the Trust Agreement or this Agreement to the same extent as the
Transferor could but for the assignment and security interest granted to the
Indenture Trustee for the benefit of the Noteholders, (v) the rights of the
Transferor to any property conveyed to the Trust under any Participation
Interest Supplement and the right to receive Recoveries attributed to cardholder
charges for merchandise and services in the Accounts, (vi) the rights of the
Seller under the Receivables Purchase Agreements, (vii) all Insurance Proceeds
related to the Receivables, (viii) all money, accounts, general intangibles,
chattel paper, instruments, documents, goods, investment property, deposit
accounts, certificates of deposit, letters of credit and advices of credit
consisting of, arising from, or related to the foregoing, (ix) any rights of the
Transferor under the Receivables Purchase Agreements, (x) all present and future
claims, demands, causes and chooses in action in respect of any or all of the
foregoing and (xi) any and all proceeds of the foregoing; in each case,
including any rights of the Owner Trustee and the Trust pursuant to the
Transaction Documents, but excluding the Transferor Interest and all amounts
distributable to the holders of any Certificates pursuant to the terms of any
Transaction Document shall constitute the assets of the Trust (the "Trust
Assets"). The foregoing does not constitute and is not intended to result in the
creation or assumption by the Trust, the Owner Trustee (as such or in its
individual capacity), the Indenture Trustee or any Noteholder of any obligation
of any Account Owner, any Transferor, the Servicer or any other Person in
connection with the Accounts or the Receivables or under any agreement or
instrument relating thereto, including any obligation to Obligors, merchant
banks, merchants clearance
16
systems or insurers. The Obligors shall not be notified in connection with the
creation of the Trust of the transfer, assignment, set-over and conveyance of
the Receivables to the Trust.
Each Transferor agrees to record and file, at its own expense,
financing statements (and continuation statements when applicable) with respect
to the Receivables conveyed by such Transferor existing on the Initial Cut-Off
Date and thereafter created meeting the requirements of applicable state law in
such manner and in such jurisdictions as are necessary to perfect, and maintain
the perfection of, the transfer and assignment of its interest in such
Receivables to the Trust, and to deliver a file stamped copy of each such
financing statement or other evidence of such filing to the Owner Trustee as
soon as practicable after the first Closing Date, in the case of Receivables
arising in the Initial Accounts, and (if any additional filing is so necessary)
as soon as practicable after the applicable Addition Date, in the case of
Receivables arising in Additional Accounts. The Owner Trustee shall be under no
obligation whatsoever to file such financing or continuation statements or to
make any other filing under the UCC in connection with such transfer and
assignment.
Each Transferor further agrees, at its own expense, on or prior to (i)
the first Closing Date, in the case of the Initial Accounts, (ii) the applicable
Addition Date, in the case of Additional Accounts with respect to such
Transferor, if any, and (iii) the applicable Removal Date, in the case of
Removed Accounts with respect to such Transferor, (a) to cause each Account
Owner to indicate in its respective computer files that Receivables created (or
reassigned, in the case of Removed Accounts) in connection with the Accounts
have been conveyed to the Trust pursuant to this Agreement (or conveyed to each
such Transferor or its designee in accordance with Section 2.10, in the case of
Removed Accounts) by including (or deleting in the case of Removed Accounts) in
such computer files a clearly specified code correctly indicating the Trust's
ownership of the Receivables, and (b) to deliver to the Owner Trustee a computer
file or microfiche list containing a true and complete list of all such Accounts
specifying for each such Account, as of the Initial Cut-Off Date, in the case of
the Initial Accounts, the applicable Addition Cut-Off Date in the case of
Additional Accounts, and the applicable Removal Date in the case of Removed
Accounts, its account number and the aggregate amount outstanding in such
Account. Each such file or list, as supplemented, from time to time, to reflect
Additional Accounts and Removed Accounts, shall be marked as Schedule 1 to this
Agreement and is hereby incorporated into and made a part of this Agreement.
Each Transferor further agrees not to alter the code referenced in this
paragraph with respect to any Account during the term of this Agreement unless
and until such Account becomes a Removed Account.
If the arrangements with respect to the Receivables hereunder shall
constitute a loan and not a purchase and sale of such Receivables, it is the
intention of the parties hereto that this Agreement shall constitute a security
agreement under applicable law, and each Transferor hereby grants to the Trust a
first priority perfected security interest in all of such Transferor's right,
title and interest, whether owned on the Initial Cut-Off Date or thereafter
acquired, in, to and under the Trust Assets, and all money, accounts, general
intangibles, chattel paper, instruments, documents, goods, investment property,
deposit accounts, certificates of deposit, letters of credit, and advices of
credit consisting of, arising from or related to the Trust Assets, and all
proceeds thereof, to secure its obligations hereunder.
17
To the extent that any Transferor retains any interest in the Trust
Assets, such Transferor grants to the Issuer a security interest in all of such
Transferor's right, title, and interest, whether owned on the Initial Cut-Off
Date or thereafter acquired, in, to and under the Trust Assets, and all money,
accounts, general intangibles, chattel paper, instruments, documents, goods,
investment property, deposit accounts, certificates of deposit, letters of
credit and advices of credit consisting of, arising from, or related to the
Trust Assets, and all proceeds thereof (collectively, the "Indenture
Collateral"), to secure its obligations hereunder. With respect to the Indenture
Collateral, the Issuer shall have all of the rights that it has under the
Indenture and the all of the rights of a secured creditor under the UCC. The
Transferor shall perform all actions necessary to maintain the perfection and
priority of Trust's security interest in the Indenture Collateral.
Section 2.02. Acceptance by Trust.
(a) The Trust hereby acknowledges its acceptance of all right, title
and interest to the property, now existing and hereafter created, conveyed to
the Trust pursuant to Section 2.01. The Trust further acknowledges that, prior
to or simultaneously with the execution and delivery of this Agreement, the
Transferor delivered to the Owner Trustee the computer file or microfiche list
relating to the Initial Accounts described in the third paragraph of Section
2.01. The Trust shall maintain all of its right, title and interest in the
Indenture Collateral until the Lien of the Indenture is released. The Owner
Trustee shall maintain a copy of Schedule 1, as delivered from time to time, at
its Corporate Trust Office.
(b) The Trust hereby agrees not to disclose to any Person any of the
account numbers or other information contained in the computer files or
microfiche lists marked as Schedule 1 and delivered to the Owner Trustee or the
Trust, from time to time, except (i) to the Servicer, a Successor Servicer or as
required by a Requirement of Law applicable to the Owner Trustee, (ii) in
connection with the performance of the Owner Trustee's or the Trust's duties
hereunder, (iii) to the Indenture Trustee in connection with its duties in
enforcing the rights of Noteholders or (iv) to bona fide creditors or potential
creditors of any Account Owner, the Servicer or any Transferor for the limited
purpose of enabling any such creditor to identify applicable Receivables or
Accounts subject to this Agreement or the Receivables Purchase Agreements. The
Trust agrees to take such measures as shall be reasonably requested by any
Transferor to protect and maintain the security and confidentiality of such
information and, in connection therewith, shall allow each Transferor or its
duly authorized representatives to inspect the Owner Trustee's security and
confidentiality arrangements as they specifically relate to the administration
of the Trust from time to time during normal business hours upon prior written
notice. The Trust shall provide the applicable Transferor with notice five
Business Days prior to disclosure of any information of the type described in
this Section.
Section 2.03. Corporate Representations and Warranties of Each
Transferor. Each Transferor hereby severally represents and warrants to the
Trust (and agrees that the Owner Trustee and the Indenture Trustee may
conclusively rely on each such representation and warranty in accepting the
Receivables in trust and in authenticating the Notes, respectively) as of each
Closing Date (but only if it was a Transferor on such date) that:
18
(a) Organization and Good Standing. Such Transferor is duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization and has, in all material respects,
full power and authority to own its properties and conduct its business
as presently owned or conducted, and to execute, deliver and perform
its obligations under this Agreement, each Transaction Document to
which it is a party and each applicable Participation Interest
Supplement.
(b) Due Qualification. Such Transferor is duly qualified to do
business and is in good standing as a foreign limited liability company
or foreign corporation (or is exempt from such requirements) 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 (i) render any Credit Card Agreement relating to an Account
specified in a Receivables Purchase Agreement with such Transferor or
any Receivable conveyed to the Trust by such Transferor unenforceable
by such Transferor or the Trust or (ii) have a material adverse effect
on the Noteholders.
(c) Due Authorization. (i) The execution and delivery of this
Agreement, each Transaction Document to which it is a party and each
applicable Participation Interest Supplement by such Transferor and the
order to the Owner Trustee to have the Notes authenticated and
delivered and the consummation by such Transferor of the transactions
provided for in this Agreement, any Receivables Purchase Agreement to
which it is a party and each applicable Participation Interest
Supplement have been duly authorized by such Transferor by all
necessary limited liability company action on the part of such
Transferor and (ii) this Agreement, each Transaction Document to which
it is a party and each Participation Interest Supplement will remain,
from the time of its execution, an official record of such Transferor.
(d) No Conflict. The execution and delivery by such Transferor
of this Agreement, each Transaction Document to which it is a party and
each applicable Participation Interest Supplement, and the performance
of the transactions contemplated by this Agreement, each Transaction
Document to which it is a party and each applicable Participation
Interest Supplement and the fulfillment of the terms hereof and thereof
applicable to such Transferor, will not conflict with or violate any
Requirements of Law applicable to such Transferor or conflict with,
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 indenture, contract, agreement, mortgage, deed of
trust or other instrument to which such Transferor is a party or by
which it or its properties are bound.
(e) No Proceedings. There are no proceedings or
investigations, pending or, to the best knowledge of such Transferor,
threatened against such Transferor before any Governmental Authority
(i) asserting the invalidity of this Agreement, any Transaction
Document to which it is a party or any applicable Participation
Interest Supplement, (ii) seeking to prevent the consummation of any of
the transactions contemplated by this Agreement, any Transaction
Document to which it is a party or any applicable Participation
Interest Supplement, (iii) seeking any determination or ruling that, in
the reasonable judgment of such Transferor, would materially and
adversely affect the
19
performance by such Transferor of its obligations under this Agreement,
any Receivables Purchase Agreement to which it is a party or any
applicable Participation Interest Supplement, (iv) seeking any
determination or ruling that would materially and adversely affect the
validity or enforceability of this Agreement, any Receivables Purchase
Agreement to which it is a party or any applicable Participation
Interest Supplement or (v) seeking to affect adversely the income or
franchise tax attributes of the Trust under the United States Federal
or any State income or franchise tax systems.
(f) All Consents. All authorizations, consents, orders or
approvals of or registrations or declarations with any Governmental
Authority required to be obtained, effected or given by such Transferor
in connection with the execution and delivery by such Transferor of
this Agreement, each Transaction Document to which it is a party and
each applicable Participation Interest Supplement and the performance
of the transactions contemplated by this Agreement, any each
Transaction Document to which it is a party and each applicable
Participation Interest Supplement by such Transferor have been duly
obtained, effected or given and are in full force and effect.
(g) Insolvency. No Insolvency Event with respect to such
Transferor has occurred and the transfer of the Receivables by such
Transferor to the Trust has not been made in contemplation of the
occurrence thereof or with the intent to hinder, delay or defraud such
Transferor or the creditors of such Transferor.
The representations and warranties of each Transferor set forth in this
Section shall survive the transfer and assignment by such Transferor of the
respective Receivables to the Trust, the pledge of the Receivables to the
Indenture Trustee pursuant to the Indenture, and the issuance of the Notes. Upon
discovery by such Transferor, the Servicer or the Owner Trustee of a breach of
any of the representations and warranties by such Transferor set forth in this
Section, the party discovering such breach shall give prompt written notice to
the other parties and the Indenture Trustee. Such Transferor agrees to cooperate
with the Servicer and the Owner Trustee in attempting to cure any such breach.
Section 2.04. Other Representations and Warranties of Each Transferor.
(a) Representations and Warranties. Each Transferor hereby severally
represents and warrants to the Trust as of the Initial Issuance Date, each
Closing Date and, with respect to Additional Accounts, as of the related
Addition Date (but only if, in either case, it was a Transferor on such date)
that:
(i) each Transaction Document to which it is a party, each
applicable Participation Interest Supplement and, in the case of
Additional Accounts, the related Assignment, each 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 affecting creditors'
rights generally from time to time in effect or general principles of
equity;
20
(ii) as of the Initial Cut-Off Date with respect to the
Initial Accounts (and the Receivables arising therein), and as of the
related Removal Date or Addition Cut-Off Date with respect to Removed
Accounts or Additional Accounts, respectively (and the Receivables
arising therein), the portion of Schedule 1 to this Agreement under
such Transferor's name, as supplemented to such date, is an accurate
and complete listing in all material respects of all the Accounts the
Receivables in which were transferred by such Transferor on the Initial
Issuance Date or such Addition 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 true and correct in
all material respects as of the Initial Cut-Off Date or such Addition
Cut-Off Date, as the case may be;
(iii) each Receivable conveyed to the Trust by such Transferor
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 Section 2.07(b)) and in compliance
with all Requirements of Law applicable to such Transferor;
(iv) all authorizations, consents, orders or approvals of or
registrations or declarations with any Governmental Authority required
to be obtained, effected or given by such Transferor in connection with
the conveyance by such Transferor of Receivables to the Trust have been
duly obtained, effected or given and are in full force and effect;
(v) either this Agreement or, in the case of Supplemental
Accounts, the related Assignment constitutes an absolute sale, transfer
and assignment to the Trust of all right, title and interest of such
Transferor in the Receivables conveyed to the Trust by such Transferor
and the proceeds thereof and Recoveries identified as relating to the
Receivables conveyed to the Trust by such Transferor or, if this
Agreement or, in the case of Additional Accounts, the related
Assignment does not constitute a sale of such property, it constitutes
a grant of a first priority perfected "security interest" (as defined
in the UCC) in such property to the Trust, which, in the case of
existing Receivables and the proceeds thereof and said Recoveries, is
enforceable upon execution and delivery of this Agreement, or, with
respect to then existing Receivables in Additional Accounts, as of the
applicable Addition Date, and which will be enforceable with respect to
such Receivables hereafter and thereafter created and the proceeds
thereof upon such creation. Upon the filing of the financing statements
and, in the case of Receivables hereafter created and the proceeds
thereof, upon the creation thereof, the Trust shall have a first
priority perfected security or ownership interest in such property and
proceeds;
(vi) on the Initial Cut-Off Date, each Initial Account
specified in Schedule 1 with respect to such Transferor is an Eligible
Account and, on the applicable Addition Cut-Off Date, each related
Additional Account specified in Schedule 1 with respect to such
Transferor is an Eligible Account;
(vii) on the Initial Cut-Off Date, each Receivable then
existing and conveyed to the Trust by such Transferor is an Eligible
Receivable and, on the applicable Addition Cut-Off Date, each
Receivable contained in the related Additional Accounts and conveyed to
the Trust by such Transferor is an Eligible Receivable;
21
(viii) as of the date of the creation of any new Receivable
transferred to the Trust by such Transferor, such Receivable is an
Eligible Receivable;
(ix) each Account has been randomly selected and no selection
procedures believed by such Transferor to be materially adverse to the
interests of the Noteholders have been used in selecting such Accounts;
(x) except as otherwise expressly provided in this Agreement
or any Indenture Supplement, neither such Transferor nor any Person
claiming through or under such Transferor has any claim to or interest
in the Collection Account, the Special Funding Account, any Series
Account or any Series Enhancement;
(xi) the aggregate amount of Receivables that arise from
Accounts that have Obligors with a billing address outside the United
States or its territories is less than 1.0% of the total amount of
Receivables in the Trust, and
(xii) the aggregate amount of Receivables that arise from
Accounts for which the Obligors is an employee of Nordstrom or an
Affiliate is less than 6.0% of the total amount of Receivables in the
Trust.
(b) Notice of Breach. The representations and warranties set forth in
Section 2.03 and this Section shall survive the transfers and assignments of the
Receivables to the Trust, the pledge of the Receivables to the Indenture Trustee
pursuant to the Indenture, and the issuance of the Notes. Upon discovery by any
Transferor or the Servicer of a breach of any of the representations and
warranties set forth in Section 2.03 or this Section, the party discovering such
breach shall give notice to the other parties within three Business Days
following such discovery; provided that the failure to give notice within three
Business Days does not preclude subsequent notice.
Section 2.05. Reassignment of Ineligible Receivables.
(a) Reassignment of Receivables. In the event (i) any representation or
warranty contained in Section 2.04(a)(ii), (iv), (vi), (vii), (viii) or (ix) is
not true and correct in any material respect as of the date specified therein
with respect to any Receivable or the related Account and such breach has a
material adverse effect on any Receivable (which determination shall be made
without regard to whether funds are then available pursuant to any Series
Enhancement) unless cured within 60 days (or, if the Transferor is diligently
pursuing a cure of such breach, 150 days) after the earlier to occur of the
discovery thereof by the Transferor which conveyed such Receivables to the Trust
or receipt by such Transferor of written notice thereof given by the Trust, the
Indenture Trustee or the Servicer, (ii) any representation or warranty contained
in Section 2.04(a)(iii) is not true and correct in any material respect as of
the date specified therein with respect to any Receivable and such breach has a
material adverse effect on any Receivable (which determination shall be made
without regard to whether funds are then available pursuant to any Series
Enhancement) or (iii) it is so provided in Section 2.07(a) with respect to any
Receivables conveyed to the Trust by such Transferor, then such Transferor shall
accept reassignment of all Receivables in the related Account ("Ineligible
Receivables") on the terms and conditions set forth in Section 2.05(b).
22
(b) Price of Reassignment. The Servicer shall deduct the portion of
such Ineligible Receivables reassigned to each Transferor which are Principal
Receivables from the aggregate amount of Principal Receivables used to calculate
the Transferor Interest. In the event that, following the exclusion of such
Principal Receivables from the calculation of the Transferor Interest, the
Transferor Interest would be less than the Required Transferor Interest, not
later than 1:00 p.m., New York City time, two Business Days after which such
reassignment obligation arises, the applicable Transferor shall make a deposit
into the Special Funding Account in immediately available funds in an amount
equal to the amount by which the Transferor Interest would be below the Required
Transferor Interest (up to the amount of such Principal Receivables).
Upon reassignment of any Ineligible Receivable, the Trust shall
automatically and without further action be deemed to transfer, assign, set over
and otherwise convey to the applicable Transferor or its designee, without
recourse, representation or warranty, all the right, title and interest of the
Trust in and to such Ineligible Receivable, all Recoveries related thereto, all
monies and amounts due or to become due and all proceeds thereof and such
reassigned Ineligible Receivable shall be treated by the Trust as collected in
full as of the date on which it was transferred. The obligation of each
Transferor to accept reassignment of any Ineligible Receivables conveyed to the
Trust by such Transferor, and to make the deposits, if any, required to be made
to the Special Funding Account as provided in this Section, shall constitute the
sole remedy respecting the event giving rise to such obligation available to the
Trust, the Noteholders (or the Indenture Trustee on behalf of the Noteholders)
or any Series Enhancer. Notwithstanding any other provision of this Section, a
reassignment of an Ineligible Receivable in excess of the amount that would
cause the Transferor Interest to be less than the Required Transferor Interest
shall not occur if the applicable Transferor fails to make any deposit required
by this Section with respect to such Ineligible Receivable. The Trust shall
execute such documents and instruments of transfer or assignment and take such
other actions as shall reasonably be requested and provided by the applicable
Transferor to effect the conveyance of such Ineligible Receivables pursuant to
this Section, but only upon receipt of an Officer's Certificate from such
Transferor that states that all conditions set forth in this Section have been
satisfied.
Section 2.06. Reassignment of Trust Portfolio. In the event any
representation or warranty of a Transferor set forth in Section 2.03(a) or (c)
or Section 2.04(a)(i) or (v) is not true and correct in any material respect and
such breach has a material adverse effect on the Receivables or Participation
Interests conveyed to the Trust by such Transferor or the availability of the
proceeds thereof to the Trust (which determination shall be made without regard
to whether funds are then available pursuant to any Series Enhancement), then
either the Trust, the Indenture Trustee or the Holders of Notes evidencing not
less than 50% of the Outstanding Amount of the Notes of all Series, by notice
then given to such Transferor and the Servicer (and to the Trust and Indenture
Trustee if given by the Noteholders), may direct such Transferor to accept a
reassignment of the Receivables and any Participation Interests conveyed to the
Trust by such Transferor if such breach and any material adverse effect caused
by such breach is not cured within 60 days of such notice (or, if the Transferor
is diligently pursuing a cure of such breach, 150 days), and upon those
conditions such Transferor shall be obligated to accept such reassignment on the
terms set forth below; provided, however, that such Receivables and
Participation Interests will not be reassigned to such Transferor if, on any day
prior to the end of such 60-day or longer period (i) the relevant representation
and warranty shall be true and correct
23
in all material respects as if made on such day and (ii) such Transferor shall
have delivered to the Trust a certificate of an authorized officer describing
the nature of such breach and the manner in which the relevant representation
and warranty has become true and correct.
The applicable Transferor shall deposit in the Collection Account in
immediately available funds not later than 1:00 p.m., New York City time, two
Business Days after which such reassignment obligation arises, in payment for
such reassignment, an amount equal to the sum of the amounts specified therefor
with respect to each outstanding Series in the related Indenture Supplement.
Notwithstanding anything to the contrary in this Agreement, such amounts shall
be distributed to the Noteholders on such Distribution Date in accordance with
the terms of each Indenture Supplement. If the Trust, the Indenture Trustee or
the Noteholders give notice directing the applicable Transferor to accept a
reassignment of the Receivables and Participation Interests as provided above,
the obligation of such Transferor to accept such reassignment pursuant to this
Section and to make the deposit required to be made to the Collection Account as
provided in this paragraph shall constitute the sole remedy respecting an event
of the type specified in the first sentence of this Section available to the
Noteholders (or the Indenture Trustee on behalf of the Noteholders) or any
Series Enhancer. Upon reassignment of the Receivables and the Participation
Interests on such Distribution Date, the Trust shall automatically and without
further action be deemed to transfer, assign, set-over and otherwise convey to
the applicable Transferor, without recourse, representation or warranty, all the
right, title and interest of the Trust in and to the Receivables and the
Participation Interests, all Recoveries allocable to the Trust, and all monies
and amounts due or to become due with respect thereto and all proceeds thereof.
The Trust shall execute such documents and instruments of transfer or assignment
and take such other actions as shall reasonably be requested by the applicable
Transferor to effect the conveyance of such property pursuant to this Section.
Section 2.07. Covenants of each Transferor. Each Transferor hereby
severally covenants that:
(a) Receivables Not Evidenced by Promissory Notes. Except in
connection with its enforcement or collection of any Receivable, such
Transferor will take no action to cause any Receivable conveyed by it
to the Trust to be evidenced by any instrument (as defined in the UCC)
and if any such Receivable is so evidenced (whether or not in
connection with the enforcement or Collection of a Receivable) it shall
be deemed to be an Ineligible Receivable and shall be reassigned to
such Transferor in accordance with Section 2.05(b).
(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 or Participation Interest conveyed by it to the Trust,
whether now existing or hereafter created, or any interest therein, and
such Transferor shall defend the right, title and interest of the Trust
and the Indenture Trustee in, to and under the Receivables and any
Participation Interest, whether now existing or hereafter created,
against all claims of third parties claiming through or under such
Transferor; provided, however, that nothing in this Section shall
prevent or be deemed to prohibit such Transferor from suffering to
exist upon any of the Receivables transferred by it to the Trust any
Liens for municipal or other local taxes if such taxes shall not at the
24
time be due and payable or if 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.
(c) Transferor Interest. Except for the conveyances hereunder,
in connection with any transaction permitted by Section 4.02(a)(i) and
as provided in Section 2.09(d) of this Agreement or Section 2.12 of the
Master Indenture such Transferor agrees not to transfer, sell, assign,
exchange or otherwise convey or pledge, hypothecate or otherwise grant
a security interest in the Transferor Interest, the Transferor
Certificate or any Supplemental Certificate and any such attempted
transfer, assignment, exchange, conveyance, pledge, hypothecation,
grant or sale shall be void; provided, however, that nothing in this
Section shall prevent the owner of an interest in the Transferor
Interest from granting to an Affiliate a participation interest or
other beneficial interest in the rights to receive cash flows related
to the Transferor Interest, if (i) such interest does not grant such
Affiliate any rights hereunder or under any other Transaction Document
or delegate to such Affiliate any obligations or duties hereunder or
under any other Transaction Document, (ii) after giving effect to such
transfer, the interest in the Transferor's Interest owned directly by
the Transferor represents an undivided ownership interest in 2.0% or
more of the Trust Assets and (iii) a Tax Opinion shall have been
delivered to each Trustee.
(d) Delivery of Collections or Recoveries. In the event that
such Transferor receives Collections or Recoveries, such Transferor
agrees to pay the Servicer all such Collections and Recoveries as soon
as practicable after receipt thereof but in no event later than two
Business Days after the Date of Processing.
(e) Notice of Liens. Such Transferor shall notify the Trust,
the Indenture Trustee and each Series Enhancer promptly after becoming
aware of any Lien on any Receivable (or on the underlying receivable)
or Participation Interest conveyed by it to the Trust other than the
conveyances hereunder and under any Receivables Purchase Agreement to
which it is a party and the Indenture.
(f) Notice of Change in Credit Card Guidelines. The Transferor
shall notify the Rating Agencies of any materially adverse change in
the Credit Card Guidelines.
(g) Continuous Perfection. The Transferor shall not change its
name, identity or structure in any manner that might cause any
financing or continuation statement filed pursuant to this Agreement to
be misleading unless the Transferor shall have delivered to the Trust
at least 30 days' prior written notice thereof and, no later than 30
days after making such change, shall have taken all action necessary or
advisable to amend such financing statement or continuation statement
so that it is not misleading. The Transferor shall not change the
jurisdiction under whose laws it is organized, its chief executive
office or change the location of its principal records concerning the
Receivables unless it has delivered to the Trust at least 30 days'
prior written notice of its intention to do so and has taken such
action as is necessary or advisable to cause the interest of the Trust
in the Receivables to continue to be perfected with the priority
required by this Agreement.
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(h) Interchange. With respect to any Distribution Date, on or
prior to the immediately preceding Determination Date, the Servicer
shall notify the Transferor of the amount of Interchange required to be
included as Collections of Finance Charge Receivables with respect to
such Monthly Period, which amount for any Series shall be specified in
the related Indenture Supplement. Not later than 1:00 p.m., New York
City time, on the related Transfer Date, the Transferor shall deposit,
or cause to be deposited, into the Collection Account, in immediately
available funds, the amount of the Interchange to be so included as
Collections of Finance Charge Receivables with respect to such Monthly
Period.
Section 2.08. Covenants of each Transferor with Respect to Receivables
Purchase Agreements.
(a) Each Transferor hereby covenants that it will at all times
enforce the covenants and agreements of the Account Owners under the
terms of the Receivables Purchase Agreements to which it is a party,
including covenants to the effect set forth below:
(i) Periodic Rate Finance Charges and Other Fees.
Except (A) as otherwise required by any Requirements of Law or
(B) as is deemed by the Account Owner to be necessary in order
for it to maintain its credit card business on a competitive
basis based on a good faith assessment by it of the nature of
its competition in the credit card business, it shall not at
any time reduce the Periodic Rate Finance Charges assessed on
the Receivables transferred by it to the Transferor or other
fees charged on any of the Accounts owned by it if either (1)
as a result of any such reduction, such Account Owner's
reasonable expectation is that such reduction will cause a
Redemption Event or Event of Default to occur or (2) such
reduction is not also applied to all comparable segments of
VISA(R) or other retail consumer revolving credit card
accounts owned by such Account Owner which have
characteristics the same as, or substantially similar to, such
Accounts.
(ii) Credit Card Agreements and Guidelines. Such
Account Owner shall comply with and perform its obligations
under the Credit Card Agreements relating to the Accounts
owned by it and the Credit Card Guidelines except insofar as
any failure so to comply or perform would not materially and
adversely affect the rights of the Trust or the Noteholders.
Subject to compliance with all Requirements of Law and Section
2.08(a)(i), such Account Owner may change the terms and
provisions of the Credit Card Agreements or the Credit Card
Guidelines with respect to any of the Accounts owned by it in
any respect (including the calculation of the amount or the
timing of charge-offs and the Periodic Rate Finance Charges
and other fees to be assessed thereon) only if such change is
made applicable to all comparable segments of VISA(R) or other
retail consumer revolving credit card accounts owned by such
Account Owner which have characteristics the same as, or
substantially similar to, such Accounts. Notwithstanding the
foregoing, unless required by Requirements of Law or as
permitted by Section 2.08(a), no Account Owner will take any
action with respect to the applicable Credit Card Agreements
or the applicable Credit Card Guidelines, which, at the time
of such action, the Account Owner reasonably believes will
have a material adverse effect on the Noteholders.
26
(iii) Receivables Purchase Agreement. The Transferor, in its
capacity as Purchaser of Receivables from the Seller under the
Receivables Purchase Agreement, shall enforce the covenants and
agreements of the Seller as set forth in such Receivables Purchase
Agreement, where a failure of the Seller to comply would have an
Adverse Effect.
(b) New or Amendments to Receivables Purchase Agreements.
Each Transferor further covenants that it will not enter into any
amendments to a Receivables Purchase Agreement or enter into a new Receivables
Purchase Agreement unless the Rating Agency Condition has been satisfied.
Section 2.09. Addition of Accounts.
(a) Additional Accounts.
(i) Required Additions. If on any Business Day, either (A) the
Transferor Interest is less than the Required Transferor Interest or
(B) the total amount of Principal Receivables is less than the Required
Minimum Principal Balance on such Business Day, the Transferor shall on
or prior to the close of business on the second Business Day following
such Business Day (the "Required Designation Date"), unless the
Transferor Interest exceeds the Required Transferor Interest and the
total amount of Principal Receivables exceeds the Required Minimum
Principal Balance, in each case, as of the close of business on such
Required Designation Date, cause to be designated additional Eligible
Accounts to be included as Accounts as of the Required Designation Date
or any earlier date in a sufficient amount such that, after giving
effect to such addition, the Transferor Interest as of the close of
business on the applicable Addition Date, is at least equal to the
Required Transferor Interest and the aggregate principal balance of
Principal Receivables, plus the then outstanding principal amount of
any Participation Interests conveyed to the Trust as of the close of
business on the Addition Date, is at least equal to the Required
Minimum Principal Balance on such date. The Transferor shall promptly
give notice to each Rating Agency of any obligation of the Transferor
to designate Accounts pursuant to the preceding sentence. The failure
of any condition set forth in Section 2.09(c) shall not relieve the
Transferor of its obligation pursuant to this paragraph; provided,
however, that the failure of the Transferor to transfer Receivables to
the Trust as provided in this clause solely as a result of the
unavailability of a sufficient amount of Eligible Receivables shall not
constitute a breach of this Agreement; provided further, that any such
failure which has not been timely cured may nevertheless result in the
occurrence of a Pay Out Event.
(ii) Optional Participation Interests. In lieu of, or in
addition to, designating Additional Accounts pursuant to Section
2.09(a)(i), the Transferor may, subject to the conditions specified in
Section 2.09(c), convey to the Trust participations (including 100%
participations) representing undivided interests in a pool of assets
primarily consisting of revolving credit card receivables and any
interests in any of the foregoing, including securities representing or
backed by such receivables and collections thereon ("Participation
Interests"). The addition of Participation Interests in the Trust shall
be
27
effected by a Participation Interest Supplement, dated the applicable
Addition Date and entered into pursuant to Section 9.01(a).
(iii) Optional Additions. In addition to designating
Additional Accounts pursuant to clause (i) above, the Transferor,
subject to the conditions set forth in this Section, may elect on any
date to designate Eligible Accounts to the Trust and/or to
automatically convey newly originated Eligible Receivables to the Trust
upon their establishment. The Transferor hereby elects to automatically
convey newly originated Eligible Receivables to the Trust upon their
establishment. The Transferor shall be permitted to transfer Eligible
Receivables to the Trust pursuant to this clause as long as (A) the
number of new Accounts and the amount of Receivables arising from such
Accounts designated during any fiscal year do not exceed 20% of the
total amount of Accounts designated to the Trust and Receivables in the
Trust, respectively, as of the first day of such year fiscal year or
(B) for any fiscal quarter, the number of new Accounts and the amount
of Receivables arising from such Accounts designated during such fiscal
quarter do not exceed 15% of the total amount of Accounts designated to
the Trust and Receivables in the Trust, respectively, as of the first
day of such quarter. The Transferor shall give prompt notice to each
Rating Agency if any of the limits set forth in the preceding sentence
have been exceeded. If the Transferor elects to suspend or terminate
the automatic addition of Eligible Receivables, it shall do so only
upon providing the Indenture Trustee, the Trust, the Rating Agencies
and the Servicer with notice thereof.
(b) Restricted Additions. Each Transferor may from time to time, at its
sole discretion, subject to the conditions specified in Section 2.09(c),
designate additional Eligible Accounts to be included as Accounts or
Participation Interests to be included as Trust Assets, in either case as of the
applicable Addition Date.
(c) Conditions to Required Additions, Optional Participation Interests
and Restricted Additions. On the Addition Date with respect to any Supplemental
Accounts or Participation Interests designated pursuant to Section 2.09(a) or
(b), the Transferor shall transfer the Receivables in such Supplemental Accounts
(and such Supplemental Accounts shall be deemed to be Accounts for purposes of
this Agreement) or shall transfer such Participation Interests, in each case as
of the close of business on the applicable Addition Date, subject to the
satisfaction of the following conditions:
(i) on or before the tenth Business Day immediately preceding
the Addition Date, each Participating Transferor shall have given the
Trust, the Indenture Trustee and each Rating Agency written notice that
the Supplemental Accounts or Participation Interests will be included
and specifying the applicable Addition Date, the Addition Cut-Off Date
and the approximate number of accounts expected to be added and the
approximate aggregate balances expected to be outstanding in the
accounts to be added (in the case of Supplemental Accounts);
(ii) in the case of Supplemental Accounts, the Participating
Transferor shall have delivered to the Trust and the Indenture Trustee
copies of UCC-1 financing statements covering such Supplemental
Accounts, if necessary to perfect the Trust's interest in the
Receivables arising therein;
28
(iii) as of each of the Addition Cut-Off Date and the Addition
Date, no Insolvency Event with respect to the Participating Transferor
or the Account Owner of the Supplemental Accounts shall have occurred
nor shall the transfer of the Receivables arising in the Supplemental
Accounts or of the Participation Interests to the Trust have been made
in contemplation of the occurrence thereof or with the intent to
hinder, delay or defraud the Transferor or the creditors of the
Transferor;
(iv) the Rating Agency Condition shall have been satisfied
with respect to such Addition;
(v) each Participating Transferor shall have delivered to the
Trust and the Indenture Trustee an Officer's Certificate, dated the
Addition Date, stating that (A) in the case of Supplemental Accounts,
as of the applicable Addition Cut-Off Date, the Supplemental Accounts
are all Eligible Accounts, (B) to the extent applicable, the conditions
set forth in Sections 2.09(c)(ii) through (c)(iv) and (c)(viii) have
been satisfied and (C) such Participating Transferor reasonably
believes that the addition by such Participating Transferor of the
Receivables arising in the Supplemental Accounts or of the
Participation Interests to the Trust will not, based on the facts known
to such officer at the time of such addition, then or thereafter result
in an Adverse Effect with respect to any Series;
(vi) on or prior to each Distribution Date, the Participating
Transferors shall have delivered to the Trust, the Indenture Trustee
and each Rating Agency, an Opinion of Counsel substantially in the form
of Exhibit D-2 with respect to the Supplemental Accounts, if any,
included as Accounts during the related Monthly Periods ending prior to
such Distribution Date; the opinion delivery requirement set forth in
the immediately preceding sentence may be modified provided that the
Rating Agency Condition is satisfied;
(vii) in the case of designation of Supplemental Accounts,
Participating Transferors shall have delivered to the Owner Trustee (A)
the computer file or microfiche list required to be delivered pursuant
to Section 2.01 with respect to such Supplemental Accounts and (B) a
duly executed Assignment; and
(viii) to the extent required by Section 4.03, the Servicer
shall have deposited in the Collection Account all Collections with
respect to such Supplemental Accounts since the Addition Cut-off Date.
(d) Additional Transferors. Upon satisfaction of the Rating Agency
Condition, the Transferor may designate Additional Transferors under this
Agreement in an amendment hereto pursuant to Section 9.01(a) and, in connection
with such designation, the Transferor shall surrender the Transferor Certificate
to the Owner Trustee in exchange for a newly issued Transferor Certificate
modified to reflect such Additional Transferor's interest in the Transferor
Interest; provided, however, that prior to any such designation and exchange the
conditions set forth in clauses (iii) and (v) of Section 3.06(b) of the Trust
Agreement shall have been satisfied with respect thereto.
29
Section 2.10. Removal of Accounts and Participation Interests.
(a) Once per Monthly Period, each Transferor shall have the right to
require the reassignment to it or its designee of all the Trust's right, title
and interest in, to and under the Receivables then existing and thereafter
created, all Recoveries related thereto after the Removal Date, all monies due
or to become due and all amounts received or receivable with respect thereto,
and all proceeds thereof in or with respect to certain specified Accounts (the
"Removed Accounts") or Participation Interests conveyed to the Trust by such
Transferor (the "Removed Participation Interests") (unless otherwise set forth
in the applicable Participation Interest Supplement or Indenture Supplement) and
designated for removal by the Transferor, upon satisfaction of the following
conditions:
(i) on or before the fifth Business Day preceding the Removal
Date, such Transferor shall have given written notice to the Trust, the
Indenture Trustee, the Servicer, the Rating Agency and each Series
Enhancer (unless such notice requirement is otherwise waived) of such
removal and specifying the Removal Date;
(ii) on or prior to the date that is five Business Days on or
before the Removal Date, such Transferor shall amend Schedule 1 by
delivering to the Owner Trustee a computer file or microfiche list
containing a true and complete list of the Removed Accounts specifying
for each such Account, as of the date notice of the Removal Date is
given, its account number, the aggregate amount outstanding in such
Account and the aggregate amount of Principal Receivables outstanding
in such Account;
(iii) the removal will not cause the Transferor Interest to be
less than the Required Transferor Interest;
(iv) such Transferor shall have represented and warranted as
of the Removal Date that the list of Removed Accounts delivered
pursuant to clause (ii) above, as of the Removal Date, is true and
complete in all material respects;
(v) the Rating Agency Condition shall have been satisfied with
respect to the removal of the Removed Accounts and removed
Participation Interests;
(vi) such Transferor shall have delivered to the Trust and the
Indenture Trustee an Officer's Certificate, dated the Removal Date, to
the effect that such Transferor reasonably believes that (A) such
removal will not have a material adverse effect on the Noteholders, (B)
such removal will not result in the occurrence of a Pay Out Event or
Event of Default, and (C) random selection procedures were used and no
selection procedures believed by such Transferor to be materially
adverse to the interests of the Noteholders have been used in selecting
the Removed Accounts; and
(vii) as of the Removal Date, no more than 10% of the
Receivables outstanding are more than 30 days Contractually Delinquent.
(b) Upon satisfaction of the above conditions, the Trust shall execute
and deliver to such Transferor a Reassignment and shall, without further action,
be deemed to transfer, assign, set over and otherwise convey to such Transferor
or its designee, effective as of the Removal
30
Date, without recourse, representation or warranty, all the right, title and
interest of the Trust in and to the Receivables arising in the Removed Accounts
and Removed Participation Interests, all Recoveries related thereto, all monies
due and to become due and all amounts received or receivable with respect
thereto after the Removal Date and all proceeds thereof and any Insurance
Proceeds relating thereto. The Trust and Owner Trustee may conclusively rely on
the Officer's Certificate delivered pursuant to this Section and shall have no
duty to make inquiries with regard to the matters set forth therein and shall
incur no personal liability in so relying.
(c) Notwithstanding the foregoing, upon the effective date of any rules
promulgated under the Financial Accounting Standards No. 140, Accounting for
Transfers and Servicing of Financial Assets and Extinguishment of Liabilities
("FAS 140") that would preclude sale accounting treatment for the conveyance of
the Receivables for FAS 140 purposes because of the existence or continued
effectiveness of the removal provisions of this Section 2.10, then the
Transferor shall no longer have the right to so remove accounts and the
provisions of this Section 2.10 shall no longer be in effect.
Section 2.11. Account Allocations. In the event that a Transfer
Restriction Event occurs with respect to a Transferor, then, (i) such Transferor
and the Servicer agree (except as prohibited by any such order) to allocate and
pay to the Trust, after the date of such inability, all Collections, including
Collections of Receivables transferred to the Trust prior to the occurrence of
such event, and all amounts which would have constituted Collections but for
such Transferor's inability to transfer Receivables (up to an aggregate amount
equal to the amount of Receivables transferred to the Trust by such Transferor
in the Trust on such date), (ii) such Transferor and the Servicer agree that
such amounts will be applied as Collections in accordance with Article Eight of
the Master Indenture and the terms of each Indenture Supplement and (iii) for so
long as the allocation and application of all Collections and all amounts that
would have constituted Collections are made in accordance with clauses (i) and
(ii) above, Principal Receivables and all amounts which would have constituted
Principal Receivables 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
Eight of the Master Indenture and the terms of each Indenture Supplement. For
the purpose of the immediately preceding sentence, such Transferor and the
Servicer shall treat the first received Collections with respect to the Accounts
as allocable to the Trust until the Trust shall have been allocated and paid
Collections in an amount equal to the aggregate amount of Principal Receivables
in the Trust as of the date of the occurrence of such event. If such Transferor
and the Servicer are unable pursuant to any Requirements of Law to allocate
Collections as described above, such Transferor and the Servicer agree that,
after the occurrence of such event, payments on each Account with respect to the
principal balance of such Account shall be allocated first to the oldest
principal balance of such Account and shall have such payments applied as
Collections in accordance with Article Eight of the Master Indenture and the
terms of each Indenture Supplement. The parties hereto agree that Finance Charge
Receivables, whenever created, accrued in respect of Principal Receivables which
have been conveyed to the Trust shall continue to be a part of the Trust
notwithstanding any cessation of the transfer of additional Principal
Receivables to the Trust and Collections with respect thereto shall continue to
be allocated and paid in accordance with Article Eight of the Master Indenture
and the terms of each Indenture Supplement.
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Section 2.12. Discount Option.
(a) The Transferor shall have the option to designate at any time and
from time to time a percentage or percentages, which may be a fixed percentage
or a variable percentage based on a formula (the "Discount Percentage"), of all
or any specified portion of Principal Receivables existing on or after the
Discount Option Date to be treated as Discount Option Receivables and thereafter
treated as Finance Charge Receivables. As of the Closing Date, the Discount
Percentage is 1.0%. Upon satisfaction of the Rating Agency Condition, the
Transferor shall also have the option of increasing, reducing or withdrawing the
Discount Percentage, at any time and from time to time, on and after the
applicable Discount Option Date. The Transferor shall provide to the Servicer,
the Trustees and any Rating Agency 30 days' prior written notice of the Discount
Option Date, and such designation shall become effective on the Discount Option
Date (i) unless such designation in the reasonable belief of the Transferor
would cause a Redemption Event or Event of Default with respect to any Series to
occur, or an event which, with notice or lapse of time or both, would constitute
a Redemption Event or Event of Default with respect to any Series and (ii) only
if the Rating Agency Condition shall have been satisfied with respect to such
designation.
(b) After the Discount Option Date, Discount Option Receivable
Collections shall be treated as Collections of Finance Charge Receivables.
Section 2.13. Representations and Warranties as to the Security
Interest of the Trust in the Receivables. The Transferor makes the following
representations and warranties to the Trust. The representations and warranties
speak as of the execution and delivery of this Agreement and as of each Closing
Date. Such representations and warranties shall survive the sale, transfer and
assignment of the Receivables to the Trust, the pledge thereof to the Indenture
Trustee and the termination of this Agreement and shall not be waived by any
party hereto unless the Rating Agency Condition is satisfied.
(a) This Agreement creates a valid and continuing security interest (as
defined in the applicable UCC) in the Indenture Collateral in favor of the
Trust, which security interest is prior to all other Liens other than the Lien
of the Indenture, and is enforceable as such as against creditors of and
purchasers from the Transferor.
(b) The Receivables constitute "accounts" within the meaning of the
applicable UCC.
(c) The Transferor owns and has good and marketable title to the
Indenture Collateral free and clear of any Lien, claim or encumbrance of any
Person.
(d) The Transferor has caused or will have caused, within ten days, 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 Indenture Collateral granted to the Trust hereunder.
(e) Other than the security interest granted to the Trust pursuant to
this Agreement, the Transferor has not pledged, assigned, sold, granted a
security interest in, or otherwise conveyed any of the Indenture Collateral. The
Transferor has not authorized
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the filing of and is not aware of any financing statements against the
Transferor that include a description of collateral covering the Indenture
Collateral other than any financing statement relating to the security interest
granted to the Trust hereunder or that has been terminated. The Transferor is
not aware of any judgment or tax lien filings against the Transferor.
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ARTICLE THREE
ADMINISTRATION AND SERVICING
OF RECEIVABLES
Section 3.01. Acceptance of Appointment and Other Matters Relating to
the Servicer.
(a) Nordstrom fsb agrees to act as the Servicer under this Agreement
and the Noteholders, by their acceptance of Notes or a beneficial interest
therein, consent to Nordstrom fsb acting as Servicer.
(b) As agent for each Transferor and the Trust, the Servicer shall
service and administer the Receivables (including the underlying receivables)
and any Participation Interests, shall collect and deposit into the Collection
Account amounts received under the Receivables (including the underlying
receivables) and any Participation Interests and shall charge off as
uncollectible Receivables, all in accordance with its customary and usual
servicing procedures for servicing credit card receivables comparable to the
Receivables and in accordance with the Credit Card Guidelines and the
Transaction Documents. As agent for each Transferor and the Trust, the Servicer
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 reasonably necessary or
desirable, including, but not limited to, billing, collecting and remitting
Collections, providing customer service and performing other activities
customary in servicing credit card receivables. Without limiting the generality
of the foregoing and subject to Section 7.01, the Servicer or its designee is
hereby authorized and empowered, unless such power is revoked by the Indenture
Trustee on account of the occurrence of a Servicer Default, (i) to instruct the
Owner Trustee or the Indenture Trustee to make withdrawals and payments from the
Collection Account, the Special Funding Account and any Series Account, as set
forth in this Agreement, the Master Indenture or any Indenture Supplement, (ii)
to take any action required or permitted under any Series Enhancement, as set
forth in this Agreement, the Master Indenture or any Indenture Supplement, (iii)
to execute and deliver, on behalf of the Trust, 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 Requirements of Law, to commence collection
proceedings with respect to such Receivable and (iv) to make any filings,
reports, notices, applications and registrations with, and to seek any consents
or authorizations from, the Commission and any state securities authority on
behalf of the Trust as may be necessary or advisable to comply with any federal
or state securities or reporting requirements or other laws or regulations. The
Owner Trustee and the Indenture Trustee upon written request therefor shall
furnish the Servicer with any documents necessary or appropriate to enable the
Servicer to carry out its servicing and administrative duties hereunder.
(c) The Servicer shall not, and no Successor Servicer shall, 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 or such Successor Servicer, as the case may be, in
connection with servicing other credit card receivables.
34
(d) The Servicer shall comply with and perform its servicing
obligations with respect to the Accounts and Receivables in accordance with the
Credit Card Agreements relating to the Accounts and the Credit Card Guidelines,
except insofar as any failure to so comply or perform would not materially and
adversely affect the Trust or the Noteholders.
(e) The Servicer shall pay out of its own funds, without reimbursement,
all expenses incurred in connection with the Trust and the servicing activities
hereunder including expenses related to enforcement of the Receivables, fees and
disbursements of the Owner Trustee (as such and in its individual capacity
including amounts owed to the Owner Trustee under the Trust Agreement, the
Administrator and the Indenture Trustee (including the reasonable fees and
expenses of its outside counsel) and independent accountants and all other fees
and expenses, including the costs of filing UCC continuation statements, the
costs and expenses relating to obtaining and maintaining the listing of any
Notes on any stock exchange and any stamp, documentary, excise, property
(whether on real, personal or intangible property) or any similar tax levied on
the Trust or the Trust's assets that are not expressly stated in this Agreement
to be payable by the Trust or the Transferor (other than federal, state, local
and foreign income and franchise taxes, if any, or any interest or penalties
with respect thereto, assessed on the Trust).
(f) The Servicer agrees at its own cost and expense to maintain during
the term of this Agreement adequate fidelity bond coverage of the officers and
employees of the Servicer (as well as any temporary personnel if not covered by
their agency's insurance) who handle or may have occasion to handle or control
any funds handled by the Servicer, documents and/or papers relating to the
Receivables. Such fidelity bond shall be in form and substance reasonable and
customary for companies which service credit card receivables, shall protect
against losses, including losses resulting from forgery, theft, embezzlement and
fraud, and the coverage under the fidelity bond shall be at least $5,000,000.
The Servicer shall furnish to the Administrator certification by the carrier of
such fidelity coverage attesting to the form or type of bond evidencing such
coverage, together with the amount, term, date of commencement, anniversary or
renewal date and name of insured and affirmatively assuring the Administrator
that such coverage cannot be materially changed, other than by an increase in
amount, or canceled without 30 days' prior written notice to the Administrator.
(g) The Servicer is authorized, in it own name, in the name of the
Trust or in the name of the Trustee on behalf of the Trust, to commence, defend
against or otherwise participate in a proceeding relating to or involving the
protection or enforcement of the interests of the Trust or the Trustee on behalf
of the Trust. If the Servicer commences or participates in a legal proceeding in
its own name, each such party shall thereupon be deemed to have automatically
assigned its interest in (excluding legal title to) the related Receivable to
the Servicer to the extent necessary for the purposes of such proceeding.
Section 3.02. Servicing Compensation. As compensation for its servicing
activities hereunder and as reimbursement for any expense incurred by it in
connection therewith, the Servicer shall be entitled to receive the Servicing
Fee with respect to each Monthly Period, payable on the related Distribution
Date. The Monthly Servicing Fee allocable to a Series of Notes with respect to
any Monthly Period (the "Monthly Servicing Fee") shall be determined in
accordance with the relevant Indenture Supplement. The portion of the Servicing
Fee with respect to any Monthly Period not paid pursuant to the preceding
sentence shall be paid by the
35
Holders of the Transferor Certificates on the related Distribution Date and in
no event shall the Trust, the Owner Trustee (as such or in its individual
capacity), the Indenture Trustee, the Noteholders of any Series or any Series
Enhancer be liable for the share of the Servicing Fee with respect to any
Monthly Period to be paid by the Holders of the Transferor Certificates.
Section 3.03. Representations, Warranties and Covenants of the
Servicer.
(a) Nordstrom fsb, as initial Servicer, hereby makes, and any Successor
Servicer by its appointment hereunder shall make, with respect to itself, on
each Closing Date (and on the date of any such appointment), the following
representations, warranties and covenants on which the Trust and the Indenture
Trustee shall be deemed to have relied in accepting the Receivables in trust and
in entering into the Indenture:
(i) Organization and Good Standing. The Servicer is a federal
savings bank duly organized and validly existing in good standing under
the laws of the United States and has, in all material respects, full
power and authority to own its properties and conduct its credit card
servicing business as presently owned or conducted, and to execute,
deliver and perform its obligations under this Agreement.
(ii) Due Qualification. The Servicer is duly qualified to do
business and is in good standing as a foreign corporation or other
foreign entity (or is exempt from such requirements) and has obtained
all necessary licenses and approvals in each jurisdiction in which the
servicing of the Receivables (including the underlying receivables) and
any Participation Interests as required by this Agreement requires such
qualification except where the failure to so qualify or obtain licenses
or approvals would not have a material adverse effect on its ability to
perform its obligations as Servicer under this Agreement.
(iii) Due Authorization. The execution, delivery, and
performance of this Agreement and the other agreements and instruments
executed or to be executed by the Servicer as contemplated hereby, have
been duly authorized by the Servicer by all necessary action on the
part of the Servicer.
(iv) Binding Obligation. This Agreement constitutes a legal,
valid and binding obligation of the Servicer, enforceable in accordance
with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting creditors' rights generally from time to time in
effect or the rights of creditors of federally chartered savings
associations the deposit accounts of which are insured by the FDIC or
which are subject to regulation by the FDIC or by general principles of
equity.
(v) No Conflict. The execution and delivery of this Agreement
by the Servicer, and the performance of the transactions contemplated
by this Agreement and the other Transaction Documents and the
fulfillment of the terms hereof and thereof applicable to the Servicer,
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 indenture,
contract, agreement, mortgage, deed of
36
trust or other instrument to which the Servicer is a party or by which
it or its properties are bound.
(vi) No Violation. The execution and delivery of this
Agreement by the Servicer, the performance of the transactions
contemplated by this Agreement and the other Transaction Documents and
the fulfillment of the terms hereof applicable to the Servicer will not
conflict with or violate any Requirements of Law applicable to the
Servicer or 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 default under any indenture, contract,
agreement, mortgage, deed of trust or other instrument to which the
Servicer is a party or by which it or any of its properties are bound.
(vii) No Proceedings. There are no proceedings or
investigations pending or, to the best knowledge of the Servicer,
threatened against the Servicer before any Governmental Authority
seeking to prevent the consummation of any of the transactions
contemplated by this Agreement or 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 and the other Transaction Documents.
(viii) Compliance with Requirements of Law. The Servicer shall
duly satisfy all obligations on its part to be fulfilled under or in
connection with each Receivable (and the underlying receivable) and the
related Account, if any, will maintain in effect all qualifications
required under Requirements of Law in order to service properly each
Receivable and the related Account, if any, 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 an Adverse Effect.
(ix) No Rescission or Cancellation. Subject to Section 3.09,
the Servicer shall not permit any rescission or cancellation of any
Receivable (or the underlying receivable) except in accordance with the
Credit Card Guidelines or as ordered by a court of competent
jurisdiction or other Governmental Authority.
(x) Protection of Rights. The Servicer shall take no action
which, nor omit to take any action the omission of which, would
substantially impair the rights of the Trust, the Indenture Trustee or
the Noteholders in any Receivable (or the underlying receivable) or the
related Account, if any, nor shall it reschedule, revise or defer
payments due on any Receivable except in accordance with the Credit
Card Guidelines.
(xi) Receivables Not Evidenced by Promissory Notes. Except in
connection with its enforcement or collection of an Account, the
Servicer will take no action to cause any Receivable to be evidenced by
any instrument (as defined in the UCC) and if any Receivable is so
evidenced (whether or not in connection with the enforcement or
collection of an Account) it shall be reassigned or assigned to the
Servicer as provided in this Section.
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(xii) All Consents. All authorizations, consents, orders or
approvals of or registrations or declarations with any Governmental
Authority required to be obtained, effected or given by the Servicer in
connection with the execution and delivery of this Agreement by the
Servicer and the performance of the transactions contemplated by this
Agreement by the Servicer, have been duly obtained, effected or given
and are in full force and effect.
(b) In the event (i) any of the representations, warranties or
covenants of the Servicer contained in Section 3.03(a)(viii), (ix) or (x) with
respect to any Receivable or the related Account is breached, and such breach
has a material adverse effect on such Receivable (which determination shall be
made without regard to whether funds are then available to any Noteholders
pursuant to any Series Enhancement) and is not cured within 60 days (or such
longer period, not in excess of 150 days, as may be agreed to by the Indenture
Trustee and the Transferor) of the earlier to occur of the discovery of such
event by the Servicer, or receipt by the Servicer of notice of such event given
by the Indenture Trustee or the Transferor, or (ii) as provided in Section
3.03(a)(xi) with respect to any Receivable, all Receivables in the Account or
Accounts to which such event relates shall be assigned and transferred to the
Servicer ("Servicer Repurchase Receivables") on the terms and conditions set
forth below.
The Servicer shall effect such assignment by making a deposit into the
Collection Account in immediately available funds two Business Days after which
such assignment obligation arises in an amount equal to the amount of such
Receivables.
Upon each such reassignment or assignment to the Servicer, the Trust
shall automatically and without further action be deemed to sell, transfer,
assign, set over and otherwise convey to the Servicer, without recourse,
representation or warranty, all right, title and interest of the Trust in and to
such Receivables, all Interchange and Recoveries related thereto, all monies due
or to become due and all amounts received or receivable with respect thereto and
all proceeds thereof. The Trust shall execute such documents and instruments of
transfer or assignment and take such other actions as shall be reasonably
requested by the Servicer to effect the conveyance of any such Receivables
pursuant to this Section but only upon receipt of an Officer's Certificate of
the Servicer that states that all conditions set forth in this section have been
satisfied. The obligation of the Servicer to accept reassignment or assignment
of such Receivables, and to make the deposits, if any, required to be made to
the Collection Account as provided in the preceding paragraph, shall constitute
the sole remedy respecting the event giving rise to such obligation available to
Noteholders (or the Indenture Trustee on behalf of Noteholders) or any Series
Enhancer, except as provided in Section 5.04.
Section 3.04. Reports and Records for the Owner Trustee and the
Indenture Trustee.
(a) Daily Records. On each Business Day, the Servicer shall make or
cause to be made available at the office of the Servicer for inspection by the
Owner Trustee and the Indenture Trustee upon request a record setting forth (i)
the Collections in respect of Principal Receivables and in respect of Finance
Charge Receivables processed by the Servicer on the second preceding Business
Day in respect of each Account and (ii) the amount of Receivables as of the
close of business on the second preceding Business Day in each Account. The
Servicer shall, at all times, maintain its computer files with respect to the
Accounts in such a manner so
38
that the Accounts may be specifically identified and shall make available to the
Owner Trustee and the Indenture Trustee at the office of the Servicer on any
Business Day any computer programs necessary to make such identification. The
Owner Trustee and the Indenture Trustee shall enter into such reasonable
confidentiality agreements as the Servicer shall deem necessary to protect its
interests and as are reasonably acceptable in form and substance to the Owner
Trustee and the Indenture Trustee.
(b) Monthly Servicer's Certificate. Not later than the Determination
Date preceding each Distribution Date, the Servicer shall, with respect to each
outstanding Series, deliver to the Owner Trustee, the Indenture Trustee and each
Rating Agency a certificate of an Authorized Officer in substantially the form
set forth in the related Indenture Supplement.
Section 3.05. Annual Certificate of Servicer. The Servicer shall
deliver to the Owner Trustee, the Indenture Trustee and each Rating Agency on or
before April 30 of each calendar year, beginning with April 30, 2003, an
Officer's Certificate substantially in the form of Exhibit C.
Section 3.06. Annual Servicing Report of Independent Public
Accountants; Copies of Reports Available.
(a) On or before April 30 of each fiscal year, beginning with April 30,
2003, the Servicer shall cause a firm of nationally recognized independent
public accountants (who may also render other services to the Servicer or the
Transferor or any Account Owner) to furnish a report (addressed to the Indenture
Trustee) to the Indenture Trustee, the Servicer and each Rating Agency to the
effect that they have applied certain procedures agreed upon with the Servicer
and examined certain documents and records relating to the servicing of the
Receivables under this Agreement, the Master Indenture and each Indenture
Supplement for the prior fiscal year (or since the effective date of this
Agreement in the case of the first such report) and that, on the basis of such
agreed-upon procedures, nothing has come to the attention of such accountants
that caused them to believe that the servicing (including the allocation of
Collections set forth in Article Eight of the Master Indenture and in each
Indenture Supplement) has not been conducted in compliance with the terms and
conditions set forth in Article Three and Section 5.08 of this Agreement,
Article Eight of the Master Indenture and the applicable provisions of each
Indenture Supplement, except for such exceptions as they believe to be
immaterial and such other exceptions as shall be set forth in such statement.
Such report shall set forth the agreed-upon procedures performed.
(b) On or before April 30 of each fiscal year, beginning with April 30,
2003, the Servicer shall cause a firm of nationally recognized independent
public accountants (who may also render other services to the Servicer or
Transferor) to furnish a report to the Indenture Trustee, the Servicer and each
Rating Agency to the effect that they have applied certain procedures agreed
upon with the Servicer to compare the mathematical calculations of certain
amounts set forth in the Servicer's certificates delivered pursuant to Section
3.04(b) during the period covered by such report with the Servicer's computer
reports that were the source of such amounts and that on the basis of such
agreed-upon procedures and comparison, and that such amounts are in agreement,
except for such exceptions as are immaterial and such other
39
exceptions as shall be set forth in such statement. Such report shall set forth
the agreed-upon procedures performed.
(c) In the event such independent public accountants require the
Indenture Trustee to agree to the procedures to be performed by such firm in any
of the reports required to be prepared pursuant to this Section, the Servicer
shall direct the Indenture Trustee in writing to so agree; provided, however,
that the Indenture Trustee will deliver such letter of agreement in conclusive
reliance upon the direction of the Servicer, and the Indenture Trustee will not
make any independent inquiry or investigation as to, and shall have no
obligation or liability in respect of, the sufficiency, validity or correctness
of such procedures.
(d) A copy of each certificate and report provided pursuant to Section
3.04(b), or Section 3.05 or 3.06, may be obtained by any Noteholder or Note
Owner by a request in writing to the Indenture Trustee addressed to the
Corporate Trust Office.
Section 3.07. Tax Treatment. Unless otherwise specified in the Master
Indenture or an Indenture Supplement with respect to a particular Series, the
Transferor has entered into this Agreement, and the Notes will be issued, with
the intention that, for federal, State and local income and franchise tax
purposes, (i) the Notes of each Series which are characterized as indebtedness
at the time of their issuance will qualify as indebtedness secured by the
Receivables and (ii) the Trust shall not be treated as an association or
publicly traded partnership taxable as a corporation. The Transferor, by
entering into this Agreement, and each Noteholder, by the acceptance of any such
Note (and each Note Owner, by its acceptance of an interest in the applicable
Note), agree to treat such Notes for federal, State and local income and
franchise tax purposes as indebtedness of the Transferor. Each Holder of such
Note agrees that it will cause any Note Owner acquiring an interest in a Note
through it to comply with this Agreement as to treatment as indebtedness under
applicable tax law, as described in this Section. The parties hereto agree that
they shall not cause or permit the making, as applicable, of any election under
Treasury Regulation Section 301.7701-3 whereby the Trust or any portion thereof
would be treated as a corporation for federal income tax purposes and, except as
required by Section 6.13 of the Master Indenture, shall not file tax returns or
obtain any federal employer identification number for the Trust but shall treat
the Trust as a security device for federal income tax purposes. The provisions
of this Agreement shall be construed in furtherance of the foregoing intended
tax treatment.
Section 3.08. Notices to Nordstrom fsb. In the event that Nordstrom fsb
is no longer acting as Servicer, any Successor Servicer shall deliver or make
available to Nordstrom fsb each certificate and report required to be provided
thereafter pursuant to Sections 3.04(b), 3.05 and 3.06.
Section 3.09. Adjustments.
(a) If the Servicer adjusts downward the amount of any Receivable
because of a rebate, refund, unauthorized charge or billing error to a
cardholder, or because such Receivable was created in respect of merchandise
which was refused or returned by a cardholder, then, in any such case, the
amount of Principal Receivables used to calculate the Transferor Interest, and
(unless otherwise specified) any other amount required herein or in the Master
Indenture or any
40
Indenture Supplement to be calculated by reference to the amount of Principal
Receivables, will be reduced by the amount of the adjustment. Similarly, the
amount of Principal Receivables used to calculate the Transferor Interest and
(unless otherwise specified) any other amount required herein or in any
Indenture Supplement to be calculated by reference to the amount of Principal
Receivables will be reduced by the principal 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 Section 2.07(b) was breached.
Any adjustment required pursuant to either of the two preceding sentences shall
be made on the second Business Day after which such adjustment obligation
arises. In the event that, following the exclusion of such Principal Receivables
from the calculation of the Transferor Interest, the Transferor Interest would
be less than the Required Transferor Interest, not later than 1:00 p.m., New
York City time, on the second Business Day after which such adjustment
obligation arises, the Transferor shall make a deposit into the Special Funding
Account in immediately available funds in an amount equal to the amount by which
the Transferor Interest would be less than the Required Transferor Interest, due
to adjustments with respect to Receivables conveyed by such Transferor (up to
the amount of such Principal Receivables).
(b) If the Servicer (i) makes a deposit into the Collection 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)
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
Collection 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 foregoing, adjustments made pursuant to this
Section shall not require any change in any report previously delivered pursuant
to Section 3.04(a).
Section 3.10. Reports to the Commission. The Servicer shall, on behalf
of the Trust, cause to be filed with the Commission all periodic reports
required to be filed under the provisions of the Exchange Act, and the rules and
regulations of the Commission thereunder. The Transferor shall, at its own
expense, cooperate in any reasonable request of the Servicer in connection with
such filings.
Section 3.11. Reports to Rating Agencies. Not later than each
Determination Date, the Servicer shall deliver to each Rating Agency a written
report (unless one or more of such Rating Agencies agrees in writing to waive
receipt of such reports, in which case, the reports need not be delivered to the
Rating Agency or Rating Agencies which waived the requirement) setting forth, as
of the last day of the related Monthly Period, the number of Accounts which were
with Obligors that had addresses located outside the United States and its
territories, and the amount of Principal Receivables in such Accounts; provided
that the foregoing report shall not be required if the number of such Accounts
is less than 1.0% of all Accounts and the amount of Principal Receivables in
such Accounts is less than 1.0% of all Principal Receivables, in each case as of
the end of such Monthly Period.
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ARTICLE FOUR
OTHER TRANSFEROR MATTERS
Section 4.01. Liability of each Transferor. Each Transferor shall be
severally, and not jointly, liable for all obligations, covenants,
representations and warranties of such Transferor arising under or related to
this Agreement. Each Transferor shall be liable only to the extent of the
obligations specifically undertaken by it in its capacity as a Transferor.
Section 4.02. Merger or Consolidation of, or Assumption of the
Obligations of, a Transferor.
(a) No Transferor shall dissolve, liquidate, consolidate with or merge
into any other corporation or convey, transfer or sell its properties and assets
substantially as an entirety to any Person unless:
(i) (A) the entity formed by such consolidation or into which
such Transferor is merged or the Person which acquires by conveyance,
transfer or sale the properties and assets of the Transferor
substantially as an entirety shall be, if such Transferor is not the
surviving entity, organized and existing under the laws of the United
States or any State, and shall be a depository institution or other
entity which is not eligible to be a debtor in a case under Title 11 of
the United States Code or is a special purpose entity whose powers and
activities are limited to substantially the same degree as provided in
the certificate of formation of the Transferor, and, if such Transferor
is not the surviving entity, shall expressly assume, by an agreement
supplemental hereto, executed and delivered to the Trust and the
Indenture Trustee, in form reasonably satisfactory to the Trust and the
Indenture Trustee, the performance of every covenant and obligation of
such Transferor hereunder, and (B) such Transferor or the surviving
entity, as the case may be, has delivered to the Owner Trustee and the
Indenture Trustee (with a copy to each Rating Agency) an Officer's
Certificate and an Opinion of Counsel each stating that such
consolidation, merger, conveyance, transfer or sale and such
supplemental agreement comply with this Section, that such supplemental
agreement is a valid and binding obligation of such surviving entity
enforceable against such surviving entity in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally from time to time in effect or general
principles of equity, and that all conditions precedent herein provided
for relating to such transaction have been complied with;
(ii) the Rating Agency Condition shall have been satisfied
with respect to such consolidation, merger, conveyance or transfer; and
(iii) the relevant Transferor shall have delivered to the
Trust, the Indenture Trustee and each Rating Agency a Tax Opinion,
dated the date of such consolidation, merger, conveyance or transfer,
with respect thereto.
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(b) Except as permitted by Section 2.07(c), the obligations, rights or
any part thereof of each Transferor hereunder shall not be assignable nor shall
any Person succeed to such obligations or rights of any Transferor hereunder
except for conveyances, mergers, consolidations, assumptions, sales or transfers
(i) in accordance with the provisions of the foregoing paragraph and (ii) to
other entities (A) which such Transferor and the Servicer determine will not
result in an Adverse Effect, (B) which meet the requirements of Section
4.02(a)(ii) and (a)(iii) and (C) for which the related purchaser, transferee,
pledgee or entity shall expressly assume, in an agreement supplemental hereto,
executed and delivered to the Trust and the Indenture Trustee in writing in form
satisfactory to the Trust and the Indenture Trustee, the performance of every
covenant and obligation of such Transferor thereby conveyed.
Section 4.03. Limitations on Liability of Each Transferor. Subject to
Section 4.01, no Transferor nor any of its directors, officers, employees,
incorporators or agents acting in such capacities shall be under any liability
to the Trust, either Trustee, the Noteholders, any Series Enhancer or any other
Person for any action taken, or for refraining from the taking of any action, in
good faith in such capacities pursuant to this Agreement, it being expressly
understood that such liability is expressly waived and released as a condition
of, and consideration for, the execution of this Agreement, the Master Indenture
and any Indenture Supplement and the issuance of the Notes; provided, however,
that this provision shall not protect any Transferor or any such individual
against any liability which would otherwise be imposed by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder. Each
Transferor and any director, officer, employee or agent of such Transferor may
rely in good faith on any document of any kind prima facie properly executed and
submitted by any Person (other than such Transferor) respecting any matters
arising hereunder.
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ARTICLE FIVE
OTHER MATTERS RELATING TO THE SERVICER
Section 5.01. Liability of the Servicer. The Servicer shall be liable
under this Article only to the extent of the obligations specifically undertaken
by the Servicer in its capacity as Servicer.
Section 5.02. 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, transfer or sell its properties and assets
substantially as an entirety to any Person, unless:
(a) (i) the entity formed by such consolidation or into which the
Servicer is merged or the Person which acquires by conveyance, transfer or sale
the properties and assets of the Servicer substantially in their entirety shall
be, if the Servicer is not the surviving entity, a corporation or a depository
institution organized and existing under the laws of the United States or any
State, and, if the Servicer is not the surviving entity, such corporation shall
expressly assume, by an agreement supplemental hereto, executed and delivered to
the Trust, Owner Trustee and the Indenture Trustee, in form satisfactory to the
Trust, Owner Trustee and the Indenture Trustee, the performance of every
covenant and obligation of the Servicer hereunder;
(i) the Servicer has delivered to the Trust, Owner Trustee and
the Indenture Trustee an Officer's Certificate and an Opinion of
Counsel each stating that such consolidation, merger, conveyance,
transfer or sale comply with this Section and that all conditions
precedent herein provided for relating to such transaction are in
compliance; and
(ii) the Rating Agency Condition shall have been satisfied
with respect to such consolidation, merger or transfer or assets; and
(b) 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 in their entirety shall be
an Eligible Servicer.
Section 5.03. Limitation on Liability of the Servicer and Others.
Except as provided in Section 3.01(e) and Section 5.04, neither the Servicer nor
any of its directors, officers, employees or agents shall be under any liability
to the Trust, either Trustee, the Noteholders, any Series Enhancer or any other
Person for any action taken, or for refraining from the taking of any action, in
good faith in its capacity as Servicer pursuant to this Agreement; provided,
however, that this provision shall not protect the Servicer or any such Person
against any liability which would otherwise be imposed by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties or by
reason of reckless disregard of obligations and duties hereunder. The Servicer
and any director, officer, employee or agent of the Servicer may rely in good
faith on any document of any kind prima facie properly executed and submitted by
any Person (other than the Servicer) 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
44
as Servicer in accordance with this Agreement and which in its reasonable
judgment may involve it in any expense or liability. The Servicer may, in its
sole discretion, undertake any such legal action which it may deem necessary or
desirable for the benefit of the Noteholders with respect to this Agreement and
the rights and duties of the parties hereto and the interests of the Noteholders
hereunder.
Section 5.04. Servicer Indemnification of the Trust and the Trustees.
The Servicer shall indemnify and hold harmless each of the Trust, the Owner
Trustee (as such and in its individual capacity), the Indenture Trustee and any
trustees predecessor thereto (including the Indenture Trustee in its capacity as
Transfer Agent and Registrar or as Paying Agent) and their respective directors,
officers, employees and agents from and against any and all loss, liability,
claim, expense or damage suffered or sustained by reason of (i) any acts or
omissions of the Servicer with respect to the Trust pursuant to this Agreement
or (ii) the administration by the Owner Trustee or the Indenture Trustee of the
Trust or the performance by the Indenture Trustee of its duties under the
Indenture (other than such as may arise from the gross negligence or willful
misconduct of the Owner Trustee or the negligence or willful misconduct of the
Indenture Trustee, as applicable), including any judgment, award, settlement,
reasonable attorneys' fees and other costs or expenses incurred in connection
with the defense of any action, proceeding or claim. Indemnification pursuant to
this Section shall not be payable from the Trust Assets. The Servicer's
obligations under this Section shall survive the termination of this Agreement
or the Trust or the earlier removal or resignation of the Owner Trustee or the
Indenture Trustee, as applicable. The Servicer agrees that the Indenture Trustee
is a third party beneficiary of this Section and is entitled to enforce the
provisions hereof for the benefit of the Trust and in its individual capacity.
Section 5.05. Resignation of the Servicer. The Servicer shall not
resign from the obligations and duties hereby imposed on it except (i) upon
determination that (a) the performance of its duties hereunder is no longer
permissible under applicable law and (b) there is no reasonable action which the
Servicer could take to make the performance of its duties hereunder permissible
under applicable law and (ii) upon the assumption, by a supplemental agreement
hereto, executed and delivered to the Trustees, in form satisfactory to each
Trustee, of the obligations and duties of the Servicer hereunder by any of its
Affiliates that is a direct or indirect wholly owned subsidiary of Nordstrom,
Inc. or by any entity the appointment of which shall have satisfied the Rating
Agency Condition and, in either case, qualifies as an Eligible Servicer. Any
determination permitting the resignation of the Servicer shall be evidenced as
to clause (i) above by an Opinion of Counsel to such effect delivered to the
Trust, the Owner Trustee and the Indenture Trustee. No resignation shall become
effective until the Indenture Trustee or a Successor Servicer shall have assumed
the responsibilities and obligations of the Servicer in accordance with Section
7.02. If within 120 days of the date of the determination that the Servicer may
no longer act as Servicer under clause (i) above the Indenture Trustee is unable
to appoint a Successor Servicer, the Indenture Trustee shall serve as Successor
Servicer. Notwithstanding the foregoing, the Indenture Trustee shall, if it is
legally unable so to act, petition a court of competent jurisdiction to appoint
any established institution qualifying as an Eligible Servicer as the Successor
Servicer hereunder. The Trust shall give prompt notice to each Rating Agency and
each Series Enhancer upon the appointment of a Successor Servicer.
Notwithstanding anything in this Agreement to the contrary, Nordstrom fsb may
assign part or all of its obligations and duties as Servicer under this
Agreement to an Affiliate of Nordstrom fsb
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so long as Nordstrom fsb shall have fully guaranteed the performance of such
obligations and duties under this Agreement.
Section 5.06. Access to Certain Documentation and Information Regarding
the Receivables. The Servicer shall provide to the Owner Trustee or the
Indenture Trustee, as applicable, access to the documentation regarding the
Accounts and the Receivables in such cases where the Owner Trustee or the
Indenture Trustee, as applicable, is required in connection with the enforcement
of the rights of Noteholders 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 the
Servicer's normal security and confidentiality procedures and (iv) at reasonably
accessible offices in the continental United States designated by the Servicer.
Nothing in this Section shall derogate from the obligation of the Transferor,
the Owner Trustee, the Indenture Trustee and 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 as a
result of such obligation shall not constitute a breach of this Section.
Section 5.07. Delegation of Duties. In the ordinary course of business,
the Servicer may at any time delegate its duties hereunder with respect to the
Accounts and the Receivables to any Person that agrees to conduct such duties in
accordance with the Credit Card Guidelines and this Agreement. The Servicer
shall promptly give notice to each Rating Agency of any delegation of duties
hereunder. Such delegation shall not relieve the Servicer of its liability and
responsibility with respect to such duties, and shall not constitute a
resignation within the meaning of Section 5.05.
Section 5.08. Examination of Records. Each Transferor and the Servicer
shall indicate generally in their computer files or other records that the
Receivables arising in the Accounts have been conveyed to the Trust, pursuant to
this Agreement. Each Transferor and the Servicer shall, prior to the sale or
transfer to a third party of any receivable held in its custody, examine its
computer records and other records to determine that such receivable is not, and
does not include, a Receivable.
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ARTICLE SIX
INSOLVENCY EVENTS
Section 6.01. Rights upon the Occurrence of an Insolvency Event. If any
Transferor shall consent or fail to object to the appointment of a bankruptcy
trustee or conservator, receiver or liquidator in any bankruptcy proceeding or
other insolvency, readjustment of debt, marshalling of assets and liabilities or
similar proceedings of or relating to any Transferor or relating to all or
substantially all of such Transferor's property, or the commencement of an
action seeking a decree or order of a court or agency or supervisory authority
having jurisdiction in the premises for the appointment of a bankruptcy trustee
or conservator, receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for the
winding-up, insolvency, bankruptcy, reorganization, conservatorship,
receivership or liquidation of such entity's affairs, or notwithstanding an
objection by such Transferor any such action shall have remained undischarged or
unstayed for a period of 60 days or upon entry of any order or decree providing
for such relief; or such Transferor shall admit in writing its inability to pay
its debts generally as they become due, file, or consent or fail to object (or
object without dismissal of any such filing within 60 days of such filing) to
the filing of, a petition to take advantage of any applicable bankruptcy,
insolvency or reorganization, receivership or conservatorship statute, make an
assignment for the benefit of its creditors or voluntarily suspend payment of
its obligations; or any order or decree providing for relief under any
applicable bankruptcy, insolvency or reorganization, receivership or
conservatorship statute shall be entered (any such act or occurrence with
respect to any Person being an "Insolvency Event"), such Transferor shall, on
the related Appointment Date, immediately cease to transfer Principal
Receivables to the Trust and shall promptly give notice to each Rating Agency
and the Trustees thereof. Notwithstanding any cessation of the transfer to the
Trust of additional Principal Receivables, Principal Receivables transferred to
the Trust prior to the occurrence of such Insolvency Event, Collections in
respect of such Principal Receivables and Finance Charge Receivables (whenever
created) accrued in respect of such Principal Receivables shall continue to be a
part of the Trust Assets and shall be allocated and distributed to Noteholders
in accordance with the terms of the Master Indenture and each Indenture
Supplement.
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ARTICLE SEVEN
SERVICER DEFAULTS
Section 7.01. Servicer Defaults.
(a) If any one of the following events (a "Servicer Default") shall
occur and be continuing:
(i) any failure by the Servicer to make any payment, transfer
or deposit or to give instructions or to give notice to the Indenture
Trustee to make such payment, transfer or deposit on or before the date
occurring five Business Days after the date such payment, transfer or
deposit or such instruction or notice is required to be made or given,
as the case may be, under the terms of this Agreement, the Master
Indenture or, with respect to a particular Series of Notes, any
Indenture Supplement;
(ii) failure on the part of the Servicer duly to observe or
perform in any material respect any other covenants or agreements of
the Servicer set forth in this Agreement which has an Adverse Effect
and which continues unremedied for a period of 60 days after the date
on which notice of such failure, requiring the same to be remedied,
shall have been given to the Servicer by the Owner Trustee or the
Indenture Trustee, or to the Servicer, the Owner Trustee and the
Indenture Trustee by Holders of Notes evidencing not less than 10% of
the Outstanding Amount of the Notes of all Series (or, with respect to
any such failure that does not relate to all Series, 10% of the
aggregate unpaid principal amount of all Series to which such failure
relates); or the Servicer shall assign or delegate its duties under
this Agreement, except as permitted by Sections 5.02 and 5.07;
(iii) any representation, warranty or certification made by
the Servicer in this Agreement or in any certificate delivered pursuant
to this Agreement shall prove to have been incorrect when made, which
has an Adverse Effect on the rights of the Noteholders of any Series
(which determination shall be made without regard to whether funds are
then available pursuant to any Series Enhancement) and which Adverse
Effect continues for a period of 60 days after the date on which notice
thereof, requiring the same to be remedied, shall have been given to
the Servicer by the Owner Trustee or the Indenture Trustee, or to the
Servicer, the Owner Trustee and the Indenture Trustee by the Holders of
Notes evidencing not less than 10% of the Outstanding Amount of the
Notes of all Series (or, with respect to any such representation,
warranty or certification that does not relate to all Series, 10% of
the aggregate unpaid principal amount of all Series to which such
representation, warranty or certification relates);
(iv) the Servicer shall consent to the appointment of a
bankruptcy trustee or conservator or receiver or liquidator in any
bankruptcy proceeding or other insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings of or
relating to the Servicer or of or relating to all or substantially all
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
bankruptcy trustee or a conservator or receiver or liquidator in
48
any bankruptcy, insolvency, readjustment of debt, marshalling of assets
and liabilities or similar proceedings, or 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
bankruptcy, insolvency or reorganization statute, make any assignment
for the benefit of its creditors or voluntarily suspend payment of its
obligations; or
(v) with respect to a particular Series of Notes, any other
Servicer Default described in the related Indenture Supplement.
Notwithstanding the foregoing, a delay in or failure of performance
referred to in Section 7.01(a)(i) for a period of ten Business Days after the
applicable grace period or under Section 7.01(a)(ii) or (a)(iii) 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 or sabotage, epidemics, landslides, lightning, fire,
hurricanes, earthquakes, floods or similar causes. The preceding sentence shall
not relieve the Servicer from using all commercially reasonable efforts to
perform its obligations in a timely manner in accordance with the terms of this
Agreement and the Servicer shall provide the Trustees, each Transferor and any
Series Enhancer with an Officer's Certificate giving prompt notice of such
failure or delay by it, together with a description of its efforts so to perform
its obligations.
(b) Upon the occurrence of a Servicer Default, so long as the Servicer
Default shall not have been remedied, either the Indenture Trustee or the
Holders of Notes evidencing more than 50% of the Outstanding Amount of the Notes
of all Series (or, with respect to any such Servicer Default that does not
relate to all Series, 50% of the Outstanding Amount of all Series to which such
Servicer Default relates), by notice then given to the Servicer and the Owner
Trustee (and to the Indenture Trustee if given by the Noteholders) (a
"Termination Notice"), may terminate all but not less than all the rights and
obligations of the Servicer as Servicer under this Agreement with respect to all
Notes or the Notes of one or more affected Series; provided, however, if within
60 days of receipt of a Termination Notice the Indenture Trustee does not
receive any bids from Eligible Servicers in accordance with Section 7.02(c) to
act as a Successor Servicer and receives an Officer's Certificate of the
Servicer to the effect that the Servicer cannot in good faith cure the Servicer
Default which gave rise to the Termination Notice, the Indenture Trustee shall
grant a right of first refusal to the Transferor which would permit the
Transferor at its option to acquire the Notes on the Distribution Date in the
next calendar month.
The price for the Notes shall be equal to the sum of the amounts
specified therefor with respect to each outstanding Series in the related
Indenture Supplement. The Transferor shall notify the Indenture Trustee prior to
the Record Date for the Distribution Date of the acquisition if it is exercising
such right of first refusal. If the Transferor exercises such right of first
refusal, the Transferor shall deposit the price into the Collection Account not
later than 1:00 p.m., New York City time, on such Distribution Date in
immediately available funds. The price shall be allocated and distributed to
Noteholders in accordance with the terms of the Master Indenture and each
Indenture Supplement.
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After receipt by the Servicer of a Termination Notice, and on the date
that a Successor Servicer is appointed by the Indenture Trustee pursuant to
Section 7.02, all authority and power of the Servicer under this Agreement with
respect to all Notes or the Notes of one or more affected Series shall pass to
and be vested in the Successor Servicer (each, a "Service Transfer"); and,
without limitation, the Indenture 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 Indenture Trustee and such Successor
Servicer in effecting the termination of the responsibilities and rights of the
Servicer to conduct servicing hereunder, including the transfer to such
Successor Servicer of all authority of the Servicer to service the Receivables
provided for under this Agreement, including 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. The Servicer shall within 20 Business Days 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 shall require the Servicer to
disclose to the Successor Servicer information of any kind which the Servicer
deems to be confidential, the Successor Servicer shall be required to enter into
such customary licensing and confidentiality agreements as the Servicer shall
deem reasonably necessary to protect its interests.
Section 7.02. Indenture Trustee To Act; Appointment of Successor.
(a) On and after the receipt by the Servicer of a Termination Notice
pursuant to Section 7.01, 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 Indenture Trustee or until a date mutually
agreed upon by the Servicer and the Indenture Trustee. The Indenture Trustee
shall as promptly as possible after the giving of a Termination Notice notify
each Rating Agency of such Termination Notice and appoint an Eligible Servicer
as a successor servicer (each, a "Successor Servicer"), and such Successor
Servicer shall accept its appointment by a written assumption in a form
acceptable to the Indenture Trustee. In the event that a Successor Servicer has
not been appointed or has not accepted its appointment at the time when the
Servicer ceases to act as Servicer, the Indenture Trustee without further action
shall automatically be appointed the Successor Servicer. The Indenture Trustee
may delegate any of its servicing obligations to an Affiliate or agent in
accordance with Sections 3.01(b) and 5.07. Notwithstanding the foregoing, the
Indenture Trustee shall, if it is legally unable so to act, petition at the
expense of the Servicer a court of competent jurisdiction to appoint any
established institution qualifying as an Eligible Servicer as the Successor
Servicer hereunder. The Indenture Trustee shall give prompt notice to each
Rating Agency and each Series Enhancer upon the appointment of a Successor
Servicer.
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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.
Notwithstanding the foregoing obligations, the Successor Servicer,
▇▇▇▇▇ Fargo, its successors or assigns, shall have (i) no liability with respect
to any obligation which was required to be performed by the terminated Servicer
prior to the date that the Successor Servicer becomes the Servicer or any claim
of a third party based on any alleged action or inaction of the terminated
Servicer, (ii) no obligation to perform any repurchase obligations, if any, of
the Servicer pursuant to Section 3.03(b), (iii) no obligations of the Servicer
in accordance with the Credit Card Guidelines, (iv) no obligations to maintain
fidelity bond coverage pursuant to Section 3.01(f) and (v) no liability or
obligation with respect to any Servicer indemnification obligations of any prior
Servicer, including the original Servicer.
(c) In connection with any Termination Notice, the Indenture Trustee
will review any bids which it obtains from Eligible Servicers and shall be
permitted to appoint any Eligible Servicer submitting such a bid as a Successor
Servicer for servicing compensation not in excess of the aggregate Servicing
Fees for all Series plus the sum of the amounts with respect to each Series and
with respect to each Distribution Date equal to any Collections of Finance
Charge Receivables allocable to Noteholders of such Series which are payable to
the Holders of the Transferor Certificates after payment of all amounts owing to
the Noteholders of such Series with respect to such Distribution Date or
required to be deposited in the applicable Series Accounts with respect to such
Distribution Date and any amounts required to be paid to any Series Enhancer for
such Series with respect to such Distribution Date pursuant to the terms of any
Enhancement Agreement; provided, however, that the Certificateholders shall be
responsible for payment of the Transferor's portion of such aggregate Servicing
Fees and all other such amounts in excess of such aggregate Servicing Fees. Each
Certificateholder agrees that, if Nordstrom fsb (or any Successor Servicer) is
terminated as Servicer hereunder, the portion of the Collections in respect of
Finance Charge Receivables that the Transferor is entitled to receive pursuant
to this Agreement, the Master Indenture or any Indenture Supplement shall be
reduced by an amount sufficient to pay the Transferor's share of the
compensation of the Successor Servicer.
(d) All authority and power granted to the Servicer under this
Agreement shall automatically cease and terminate upon termination of the Trust
pursuant to Section 8.01 of the Trust Agreement, and shall pass to and be vested
in the Transferor and, without limitation, the Transferor is hereby authorized
and empowered to execute and deliver, on behalf of the 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 Servicer agrees to cooperate
with the Transferor in effecting the termination of the responsibilities and
rights of the Servicer to conduct servicing of the Receivables. The Servicer
shall transfer its electronic records relating to the Receivables to the
Transferor or its designee in such electronic form as it may reasonably request
and shall transfer all other records, correspondence and documents to it in the
manner and at such times as it shall reasonably request. To the extent that
compliance with this Section shall require the Servicer to
51
disclose to the Transferor information of any kind which the Servicer deems to
be confidential, the Transferor shall be required to enter into such customary
licensing and confidentiality agreements as the Servicer shall deem necessary to
protect its interests.
(e) Notwithstanding anything contained in the Transfer and Servicing
Agreement to the contrary, ▇▇▇▇▇ Fargo, as Successor Servicer, is authorized to
accept and rely on all of the accounting records (including computer records)
and work of the prior Servicer relating to the Receivables (collectively, the
"Predecessor Servicer Work Product") without any audit or other examination
thereof, and it shall have no duty, responsibility, obligation or liability for
the acts and omissions of the prior Servicer. If any error, inaccuracy, omission
or incorrect or non-standard practice or procedure (collectively, "Errors")
exist in any Predecessor Servicer Work Product and such Errors make it
materially more difficult to service or should cause or materially contribute to
▇▇▇▇▇ Fargo making or continuing any Errors (collectively, "Continued Errors"),
it shall have no duty, responsibility, obligation or liability to perform
servicing for such Continued Errors; provided, however, that ▇▇▇▇▇ Fargo agrees
to use its best efforts to prevent further Continued Errors. In the event that
▇▇▇▇▇ Fargo becomes aware of Errors or Continued Errors, it shall, with the
prior consent of the Noteholders representing 66-2/3% of the outstanding Notes,
use its best efforts to reconstruct and reconcile such data as is commercially
reasonable to correct such Errors and Continued Errors and to prevent future
Continued Errors. ▇▇▇▇▇ Fargo shall be entitled to recover its costs thereby
expended in accordance with Section 4.03(a) of the Series ▇▇▇▇-▇ ▇▇▇▇▇▇▇▇▇
Supplement or similar section.
Section 7.03. Notification to Noteholders. Within two Business Days
after the Servicer becomes aware of any Servicer Default, the Servicer shall
give notice thereof to the Trustees, each Rating Agency and each Series Enhancer
and the Indenture Trustee shall give notice to the Noteholders. Upon any
termination or appointment of a Successor Servicer pursuant to this Article, the
Indenture Trustee shall give prompt notice thereof to the Noteholders.
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ARTICLE EIGHT
TERMINATION
Section 8.01. Termination of Agreement. This Agreement and the
respective obligations and responsibilities of the parties hereto shall
terminate, except with respect to the duties described in Section 5.04, on the
Trust Termination Date.
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ARTICLE NINE
MISCELLANEOUS PROVISIONS
Section 9.01. Amendment; Waiver of Past Defaults.
(a) This Agreement may be amended by the parties hereto from time to
time prior to, or in connection with, the issuance of the first Series of Notes
hereunder without the requirement of any consents or the satisfaction of any
conditions set forth below. This Agreement may be amended from time to time by
the Servicer, the Transferor, the Indenture Trustee and the Trust, by a written
instrument signed by each of them, without the consent of the Noteholders,
provided that (i) the Transferor shall have delivered to the Trustees an
Officer's Certificate, dated the date of any such amendment, stating that the
Transferor reasonably believes that such amendment will not have an Adverse
Effect, (ii) such amendment does not affect the rights, duties or obligations of
the Servicer or either Trustee hereunder and (iii) the Rating Agency Condition
shall have been satisfied with respect to any such amendment. Additionally,
notwithstanding the preceding sentence, this Agreement may be amended by the
Servicer, the Indenture Trustee and the Trust at the direction of the Transferor
without the consent of any of the Noteholders or Series Enhancers to add, modify
or eliminate such provisions as may be necessary or advisable in order to enable
all or a portion of the Trust (i) 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 Code,
and (ii) to avoid the imposition of state or local income or franchise taxes
imposed on the Trust's property or its income; provided, however, that (A) the
Transferor delivers to the Trustees an Officer's Certificate to the effect that
the proposed amendments meet the requirements set forth in this Section, (B) the
Rating Agency Condition hereunder shall have been satisfied with respect to any
such amendment and (C) such amendment does not affect the rights, duties or
obligations of the Servicer or either Trustee. The amendments which the
Transferor may make without the consent of Noteholders or Series Enhancers
pursuant to the preceding sentence may include the addition of a sale of
Receivables or Participations.
(b) This Agreement may also be amended from time to time by the parties
hereto, with the consent of the Noteholders evidencing not less than 66-2/3% of
the Outstanding Amount of all affected Series for which the Transferor has not
delivered an Officer's Certificate stating that there is no Adverse Effect, 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 Noteholders; provided, however, that such amendment shall satisfy the
Rating Agency Condition and shall not (i) reduce in any manner the amount of or
delay the timing of any distributions (changes in Redemption Events or Events of
Default that decrease the likelihood of the occurrence thereof shall not be
considered delays in the timing of distributions for purposes of this clause) to
be made to Noteholders or deposits of amounts to be so distributed or the amount
available under any Series Enhancement without the consent of each affected
Noteholder, (ii) change the definition of or the manner of calculating the
interest of any Noteholder without the consent of each affected Noteholder,
(iii) reduce the aforesaid percentage required to consent to any such amendment
without the consent of each Noteholder or (iv) change in any material respect
the permitted activities of the Trust or the Servicer.
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(c) Promptly after the execution of any such amendment or consent
(other than an amendment pursuant to Section 9.01(a)), the Servicer shall
furnish notification of the substance of such amendment to the Indenture
Trustee, each Noteholder, each Rating Agency and each Series Enhancer.
(d) It shall not be necessary for the consent of Noteholders under this
Section to approve the particular form of any proposed amendment, but it shall
be sufficient if such consent shall approve the substance thereof. The manner of
obtaining such consents and of evidencing the authorization of the execution
thereof by Noteholders shall be subject to such reasonable requirements as the
Indenture Trustee may prescribe.
(e) Notwithstanding anything in this Section to the contrary, no
amendment may be made to this Agreement or any Participation Interest Supplement
which would adversely affect in any material respect the interests of any Series
Enhancer without the consent of such Series Enhancer.
(f) Any Indenture Supplement executed in accordance with the provisions
of Article Ten of the Master Indenture shall not be considered an amendment of
this Agreement for the purposes of this Section.
(g) The Owner Trustee may, but shall not be obligated to, enter into
any such amendment which affects the Owner Trustee's rights, duties, benefits,
protections, privileges or immunities under this Agreement or otherwise. In
connection with the execution of any amendment hereunder, the Owner Trustee
shall be entitled to receive the Opinion of Counsel described in Section
9.03(d).
Section 9.02. Waiver of Transferor or Servicer Defaults.
The Holders of Notes evidencing more than 66-2/3% of the Outstanding
Amount of the Notes of all Series or, with respect to any Series with two or
more Classes, of each Class (or, with respect to any default that does not
relate to all Series, 66-2/3% of the of the Outstanding Amount of the Notes of
each Series to which such default relates or, with respect to any such Series
with two or more Classes, of each Class) may, on behalf of all Noteholders,
waive any default by the Transferor or the Servicer in the performance of their
obligations hereunder and its consequences, except the failure to make any
distributions required to be made to Noteholders or to make any required
deposits of any amounts to be so distributed. 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. Promptly after any
such waiver of a past default, the Servicer shall furnish notification of the
substance of such waiver to each Rating Agency.
Section 9.03. Protection of Right, Title and Interest to Trust Assets.
(a) The Transferor shall cause this Agreement, all amendments and
supplements hereto and all financing statements and continuation statements and
any other necessary documents covering the Indenture Trustee's and the Trust's
right, title and interest to the Trust Assets to be promptly recorded,
registered and filed, and at all times to be kept recorded,
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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
Indenture Trustee, Noteholders and the Trust hereunder to all property
comprising the Trust Assets. The Transferor shall deliver to the Owner Trustee
and Indenture 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. The 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 paragraph.
(b) Within 30 days after any Transferor makes any change in its name,
identity or corporate structure which would make any financing statement or
continuation statement filed in accordance with Section 9.03(a) seriously
misleading within the meaning of Section 9-506 (or any comparable provision) of
the UCC, such Transferor shall give the Trustees notice of any such change and
shall file such financing statements or amendments as may be necessary to
continue the perfection of the Trust's security interest or ownership interest
in the Receivables and the proceeds thereof.
(c) Each Transferor shall give the Trustees prompt notice of any
relocation of its chief executive office or any change in the jurisdiction under
whose laws it is organized and whether, as a result of such relocation or
change, the applicable provisions of the UCC would require the filing of any
amendment of any previously filed financing or continuation statement or of any
new financing statement and shall file such financing statements or amendments
as may be necessary to perfect or to continue the perfection of the Trust's
security interest in the Receivables and the proceeds thereof. Each Transferor
shall at all times maintain its chief executive offices within the United States
and shall at all times be organized under the laws of a jurisdiction located
within the United States.
(d) The Transferor shall deliver to the Trustees and each Rating Agency
(i) upon the execution and delivery of each amendment of this Agreement, an
Opinion of Counsel to the effect specified in Exhibit D-1, (ii) on each date
specified in Section 2.09(c)(vi) with respect to any Additional Accounts to be
designated as Accounts, an Opinion of Counsel substantially in the form of
Exhibit D-2, (iii) on each Addition Date on which any Participation Interests
are to be included in the Trust pursuant to Section 2.09(a) or (b), an Opinion
of Counsel covering the same substantive legal issues addressed by Exhibits D-1
and D-2 but conformed to the extent appropriate to relate to Participation
Interests and (iv) on or before April 30 of each year, beginning with April 30,
2003, an Opinion of Counsel substantially in the form of Exhibit D-3.
Section 9.04. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT
REFERENCE TO ITS CONFLICT OF LAWS PROVISIONS (OTHER THAN SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW) AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
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Section 9.05. Notices; Payments.
(a) All Notices under this Agreement shall be in writing and shall be
deemed to have been duly given if personally delivered at, mailed by registered
mail, return receipt requested, or sent by facsimile transmission (i) in the
case of the Transferor, to Nordstrom Credit Card Receivables LLC, at ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Legal Department (facsimile
no. (▇▇▇) ▇▇▇-▇▇▇▇), (ii) in the case of the Servicer, to Nordstrom fsb, at
▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention: Legal Department
(facsimile no. (▇▇▇) ▇▇▇-▇▇▇▇), (iii) in the case of the Trust or the Owner
Trustee, to Owner Trustee, ▇▇▇▇▇▇ Square North, ▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention: Corporate Trust Administration (facsimile no.
(▇▇▇) ▇▇▇-▇▇▇▇), (iv) ▇▇▇▇▇ Fargo Bank Minnesota, National Association, ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇-▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Attention:
Corporate Trust, Asset Backed Securities (facsimile no. (▇▇▇) ▇▇▇-▇▇▇▇), (v) in
the case of the Rating Agency for a particular Series, the address, if any,
specified in the Indenture Supplement relating to such Series and (vi) to any
other Person as specified in the Master Indenture or any Indenture Supplement;
or, as to each party, at such other address or facsimile number as shall be
designated by such party in a written notice to each other party.
(b) Any Notice required or permitted to be given to a Holder of
Registered Notes shall be given by first-class mail, postage prepaid, at the
address of such Holder as shown in the Note Register. No Notice shall be
required to be mailed to a Holder of Bearer Notes or Coupons but shall be given
as provided below. Any Notice so mailed within the time prescribed in this
Agreement shall be conclusively presumed to have been duly given, whether or not
the Noteholder receives such Notice. In addition, (i) if and so long as any
Series or Class is listed on the Luxembourg Stock Exchange and such Exchange
shall so require, any Notice to Noteholders shall be published in an Authorized
Newspaper of general circulation in Luxembourg within the time period prescribed
in this Agreement and (ii) in the case of any Series or Class with respect to
which any Bearer Notes are outstanding, any Notice required or permitted to be
given to Noteholders of such Series or Class shall be published in an Authorized
Newspaper within the time period prescribed in this Agreement.
Section 9.06. 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 remaining covenants, agreements, provisions or terms or of
the Notes or the rights of the Noteholders or Note Owners.
Section 9.07. Further Assurances. The Transferor 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 Owner Trustee
and the Indenture Trustee more fully to effect the purposes of this Agreement,
including the execution of any financing statements or continuation statements
relating to the Receivables for filing under the provisions of the UCC of any
applicable jurisdiction.
Section 9.08. No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of the Trust, the Owner Trustee, the
Indenture Trustee or the Noteholders,
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any right, remedy, power or privilege under this Agreement shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege under this Agreement preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege. The
rights, remedies, powers and privileges provided under this Agreement are
cumulative and not exhaustive of any rights, remedies, powers and privileges
provided by law.
Section 9.09. Counterparts. This Agreement 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 9.10. Third-Party Beneficiaries. This Agreement will inure to
the benefit of and be binding upon the parties hereto and inure to the benefit
of the Owner Trustee, the Noteholders and their respective successors and
permitted assigns. Except as otherwise expressly provided in this Agreement, no
other Person will have any right or obligation hereunder.
Section 9.11. Actions by Noteholders.
(a) Wherever in this Agreement a provision is made that an action may
be taken or a Notice given by Noteholders, such action or Notice may be taken or
given by any Noteholder, unless such provision requires a specific percentage of
Noteholders.
(b) Any Notice, request, authorization, direction, consent, waiver or
other act by the Holder of a Note shall bind such Holder and every subsequent
Holder of such Note and of any Note 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 Owner Trustee, the Transferor or the Servicer in
reliance thereon, whether or not notation of such action is made upon such Note.
Section 9.12. Rule 144A Information. For so long as any of the Notes of
any Series or Class are "restricted securities" within the meaning of Rule
144(a)(3) under the Securities Act, each of the Transferor, the Trust, the
Indenture Trustee, the Servicer and any Series Enhancer agree to cooperate with
each other to provide to any Noteholders of such Series or Class and to any
prospective purchaser of Notes designated by such Noteholder, upon the request
of such Noteholder or prospective purchaser, any information in its possession
required to be provided to such holder or prospective purchaser to satisfy the
condition set forth in Rule 144A(d)(4) under the Securities Act.
Section 9.13. 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 not be
modified, amended, waived or supplemented except as provided herein.
Section 9.14. Headings. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.
Section 9.15. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 5.02, this Agreement may not be
assigned by the Servicer without the prior consent of Holders of Notes
evidencing not less than 66-2/3% of the aggregate unpaid
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principal amount of all Series of Notes. The Servicer shall give the Rating
Agencies prior written notice of any such assignment.
Section 9.16. Nonpetition Covenant. Notwithstanding any prior
termination of this Agreement, the Servicer, the Owner Trustee, the Indenture
Trustee, the Seller and each Transferor shall not, prior to the date which is
one year and one day after the termination of this Agreement, acquiesce,
petition or otherwise invoke or cause a Transferor or the Trust to invoke the
process of any Governmental Authority for the purpose of commencing or
sustaining a case against a Transferor or the Trust under any Federal or state
bankruptcy, insolvency or similar law or appointing a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official of a
Transferor or the Trust or any substantial part of its property or ordering the
winding-up or liquidation of the affairs of a Transferor or the Trust.
Section 9.17. Limitation of Liability. Notwithstanding any other
provision herein or elsewhere, this Agreement has been executed and delivered by
the Owner Trustee, not in its individual capacity, but solely in its capacity as
Owner Trustee of the Trust, in no event shall Owner Trustee in its individual
capacity have any liability in respect of the representations, warranties, or
obligations of the Trust hereunder or under any other document, as to all of
which recourse shall be had solely to the assets of the Trust, and for all
purposes of this Agreement and each other document, the Owner Trustee (as such
or in its individual capacity) shall be subject to, and entitled to the benefits
of, the terms and provisions of the Trust Agreement.
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IN WITNESS WHEREOF, the Transferor, the Servicer, the Trust and the
Indenture Trustee have caused this Transfer and Servicing Agreement to be duly
executed by their respective officers as of the day and year first above
written.
NORDSTROM CREDIT CARD RECEIVABLES LLC,
as Transferor
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
NORDSTROM fsb,
as Servicer
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
NORDSTROM CREDIT CARD MASTER NOTE TRUST,
as Issuer
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President
▇▇▇▇▇ FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION,
as Indenture Trustee
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Assistant Vice President
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EXHIBIT A
FORM OF ASSIGNMENT OF RECEIVABLES IN ADDITIONAL ACCOUNTS
(As required by Section 2.09(a)(i) and 2.09(b) of
the Transfer and Servicing Agreement)
ASSIGNMENT No. __ OF RECEIVABLES IN ADDITIONAL ACCOUNTS dated as of
_____________,1 among Nordstrom Credit Card Receivables LLC, as transferor (the
"Transferor"), Nordstrom fsb, as servicer (the "Servicer"), Nordstrom Credit
Card Master Note Trust (the "Trust") and ▇▇▇▇▇ Fargo Bank Minnesota, National
Association, as Trustee (the "Indenture Trustee"), pursuant to the Transfer and
Servicing Agreement referred to below.
WITNESSETH
WHEREAS, the Transferor, the Servicer, the Trust and the Indenture
Trustee are parties to the Transfer and Servicing Agreement, dated as of April
1, 2002 (as amended and supplemented, the "Agreement");
WHEREAS, pursuant to the Agreement, the Transferor wishes 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
Trust; and
WHEREAS, the Trust is willing to accept such designation and conveyance
subject to the terms and conditions hereof.
NOW, THEREFORE, the Transferor, the Servicer, the Trust and the
Indenture Trustee hereby agree as follows:
1. Defined Terms. Capitalized terms used herein that are not otherwise
defined shall have the meanings ascribed thereto in the Transfer and Servicing
Agreement.
"Addition Cut-Off Date" means, with respect to the Additional Accounts
designated hereby, ____________, ____.
"Addition Date" means, with respect to the Additional Accounts
designated hereby, ____________, ____.
2. Designation of Additional Accounts. On or before the date hereof,
the Transferor will deliver to the Owner Trustee a computer file or microfiche
list containing a true and complete schedule identifying all Additional Accounts
designated hereby (the "Additional Accounts") specifying for each such
Additional Account, as of the Addition Cut-Off Date, its
--------
1 To be dated as of the applicable Addition Date.
A-1
account number and the aggregate amount outstanding in such Account, which
computer file or microfiche list shall supplement Schedule 1 to the Agreement.
3. Conveyance of Receivables.
(a) The Transferor does hereby transfer, assign, set over and otherwise
convey, without recourse except as set forth in the Transfer and Servicing
Agreement, to the Trust, all its right, title and interest in, to and under the
Receivables of such Additional Accounts existing at the close of business on the
Addition Cut-Off Date and thereafter created from time to time until the
termination of the Trust, all Interchange and Recoveries related thereto, all
monies due or to become due and all amounts received or receivable with respect
thereto and all proceeds (including "proceeds" as defined in the UCC) thereof.
The foregoing does not constitute and is not intended to result in the creation
or assumption by the Trust, the Owner Trustee (as such or in its individual
capacity), the Indenture Trustee, any Noteholders or any Series Enhancer of any
obligation of the Servicer, the Transferor or any other Person in connection
with the Accounts, the Receivables or under any agreement or instrument relating
thereto, including any obligation to Obligors, merchant banks, merchants
clearance systems or insurers. If necessary, the Transferor agrees to record and
file, at its own expense, financing statements (and continuation statements when
applicable) with respect to the Receivables in Additional Accounts existing on
the Addition Cut-Off Date and thereafter created meeting the requirements of
applicable state law in such manner and in such jurisdictions as are necessary
to perfect, and maintain perfection of, the sale and assignment of its interest
in such Receivables to the Trust, and to deliver a file-stamped copy of each
such financing statement or other evidence of such filing to the Owner Trustee
on or prior to the Addition Date. The Owner Trustee shall be under no obligation
whatsoever to file such financing or continuation statements or to make any
other filing under the UCC in connection with such sale and assignment.
(b) In connection with such sale, the Transferor further agrees, at its
own expense, on or prior to the date of this Assignment, to indicate in the
appropriate computer files that Receivables created in connection with the
Additional Accounts have been conveyed to the Trust pursuant to the Agreement
and this Assignment.
(c) The Transferor does hereby grant to the Trust a security interest
in all of its right, title and interest, whether now owned or hereafter
acquired, in and to the Receivables in the Additional Accounts existing on the
Addition Cut-Off Date and thereafter created from time to time until the
termination of the Trust, all Interchange and Recoveries related thereto, all
monies due or to become due and all amounts received or receivable with respect
thereto, all money, accounts, general intangibles, chattel paper, instruments,
documents, goods, investment property, deposit accounts, certificates of
deposit, letters of credit, and advices of credit consisting of, arising from or
related to the foregoing, and all "proceeds" (including "proceeds" as defined in
the UCC) thereof. This Assignment constitutes a security agreement under the
UCC.
4. Acceptance by Trust. The Trust hereby acknowledges its acceptance of
all right, title and interest to the property, now existing and hereafter
created, conveyed to the Trust pursuant to Section 3 of this Assignment. The
Trust further acknowledges that, prior to or simultaneously with the execution
and delivery of this Assignment, the Transferor delivered to the Owner Trustee
the computer file or microfiche list described in Section 2 of this Assignment.
A-2
5. Representations and Warranties of the Transferor. The Transferor
hereby represents and warrants to the Trust, as the Addition Date that:
(a) Legal Valid and Binding Obligation. This Assignment
constitutes a legal, valid and binding obligation of the Transferor
enforceable against the 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. As of the Addition Cut-Off Date,
each Additional Account designated hereby is an Eligible Account.
(c) Insolvency. As of each of the Addition Cut-Off Date and
the Addition Date, no Insolvency Event with respect to the Transferor
has occurred and the transfer by the Transferor of Receivables arising
in the Additional Accounts to the Trust has not been made in
contemplation of the occurrence thereof.
(d) Redemption Event; Event of Default. The Transferor
reasonably believes that (i) the transfer of the Receivables arising in
the Additional Accounts will not, based on the facts known to the
Transferor, then or thereafter cause a Redemption Event or Event of
Default to occur with respect to any Series and (ii) the Additional
Accounts were randomly selected and no selection procedure was utilized
by the Transferor which would result in the selection of Additional
Accounts (from among the available Eligible Accounts available to the
Transferor) that would be materially adverse to the interests of the
Noteholders of any Series as of the Addition Date.
(e) Security Interest. This Assignment constitutes a valid
sale, transfer and assignment to the Trust of all right, title and
interest, whether owned on the Addition Cut-Off Date or thereafter
acquired, of the Transferor in the Receivables existing on the Addition
Cut-Off Date or thereafter created in the Additional Accounts, all
Interchange and Recoveries related thereto, all monies due or to become
due and all amounts received or receivable with respect thereto and the
"proceeds" (including "proceeds" as defined in the applicable UCC)
thereof, or, if this Assignment does not constitute a sale of such
property, it constitutes a grant of a "security interest" (as defined
in the applicable UCC) in such property to the Trust, which, in the
case of existing Receivables and the proceeds thereof, is enforceable
upon execution and delivery of this Assignment, and which will be
enforceable with respect to such Receivables hereafter created and the
proceeds thereof upon such creation. Upon the filing of the financing
statements described in Section 3 of this Assignment and, in the case
of the Receivables hereafter created and the proceeds thereof, upon the
creation thereof, the Trust shall have a first priority perfected
security or ownership interest in such property.
(f) No Conflict. The execution and delivery by the Transferor
of this Assignment, the performance of the transactions contemplated by
this Assignment and the fulfillment of the terms hereof applicable to
the Transferor, will not conflict with or
A-3
violate any Requirements of Law applicable to the Transferor or
conflict with, 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 indenture, contract, agreement,
mortgage, deed of trust or other instrument to which the Transferor is
a party or by which it or its properties are bound.
(g) No Proceedings. There are no proceedings or
investigations, pending or, to the best knowledge of the Transferor,
threatened against the Transferor before any court, regulatory body,
administrative agency or other tribunal or governmental instrumentality
(i) asserting the invalidity of this Assignment, (ii) seeking to
prevent the consummation of any of the transactions contemplated by
this Assignment, (iii) seeking any determination or ruling that, in the
reasonable judgment of the Transferor, would materially and adversely
affect the performance by the Transferor of its obligations under this
Assignment or (iv) seeking any determination or ruling that would
materially and adversely affect the validity or enforceability of this
Assignment.
(h) All Consents. All authorizations, consents, orders or
approvals of any court or other governmental authority required to be
obtained by the Transferor in connection with the execution and
delivery of this Assignment by the Transferor and the performance of
the transactions contemplated by this Assignment by the Transferor,
have been obtained.
6. Ratification of Agreement. As supplemented by this Assignment, the
Agreement is in all respects ratified and confirmed and the Agreement as so
supplemented by this Assignment shall be read, taken and construed as one and
the same instrument.
7. 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 shall constitute one and the same
instrument.
8. GOVERNING LAW. THIS ASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS
CONFLICT OF LAWS PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW) AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
9. Limitation of Liability. Notwithstanding any other provision herein
or elsewhere, this Assignment has been executed and delivered by Wilmington
Trust Company, not in its individual capacity, but solely in its capacity as
Owner Trustee of the Trust, in no event shall Wilmington Trust Company in its
individual capacity have any liability in respect of the representations,
warranties or obligations of the Trust hereunder or under any other document, as
to all of which recourse shall be had solely to the assets of the Trust and for
all purposes of this Assignment and each other document, the Owner Trustee (as
such or in its individual capacity) shall be subject to, and entitled to the
benefits of, the terms and provisions of the Trust Agreement.
A-4
IN WITNESS WHEREOF, the Transferor, the Servicer, the Trust and the
Indenture Trustee have caused this Assignment to be duly executed by their
respective officers as of the day and year first above written.
NORDSTROM CREDIT CARD RECEIVABLES LLC,
as Transferor
By:
-----------------------------------
Name:
Title:
NORDSTROM fsb,
as Servicer
By:
-----------------------------------
Name:
Title:
NORDSTROM CREDIT CARD MASTER NOTE TRUST,
as Issuer
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee
By:
-----------------------------------
Name:
Title:
▇▇▇▇▇ FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION,
as Indenture Trustee
By:
-----------------------------------
Name:
Title:
A-5
SCHEDULE 1
LIST OF ACCOUNTS
S1-1
EXHIBIT B
FORM OF REASSIGNMENT OF RECEIVABLES IN REMOVED ACCOUNTS
(As required by Section 2.10 of
the Transfer and Servicing Agreement)
REASSIGNMENT No. _______ OF RECEIVABLES dated as of _________,(2) among
Nordstrom Credit Card Receivables LLC, as transferor (the "Transferor"),
Nordstrom fsb, as Servicer (the "Servicer"), Nordstrom Credit Card Master Note
Trust (the "Trust") and ▇▇▇▇▇ Fargo Bank Minnesota, National Association, as
Trustee (the "Indenture Trustee"), pursuant to the Transfer and Servicing
Agreement referred to below.
WITNESSETH:
WHEREAS the Transferor, the Servicer, the Trust and the Indenture
Trustee are parties to the Transfer and Servicing Agreement, dated as of April
1, 2002 (as amended and supplemented, the "Agreement");
WHEREAS pursuant to the Agreement, the Transferor wishes to remove from
the Trust all Receivables owned by the Trust in certain designated Accounts (the
"Removed Accounts") and to cause the Trust to reconvey the Receivables of such
Removed Accounts, whether now existing or hereafter created, from the Trust to
the Transferor; and
WHEREAS the Trust 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 Transferor, the Servicer, the Trust and the
Indenture Trustee hereby agree as follows:
1. Defined Terms. Capitalized terms used herein that are not otherwise
defined shall have the meanings ascribed thereto in the Transfer and Servicing
Agreement.
"Removal Date" means, with respect to the Removed Accounts designated
hereby, ___________, ____
"Removal Notice Date" means, with respect to the Removed Accounts
______________, ____
2. Designation of Removed Accounts. On or before the Removal Date, the
Transferor will deliver to the Owner Trustee a computer file or microfiche list
containing a true and complete schedule identifying all Accounts the Receivables
of which are being removed from the Trust, specifying for each such Account, as
of the Removal Notice Date, its account
--------
(2) To be dated as of the Removal Date.
B-1
number and the aggregate amount outstanding in such Account, which computer file
or microfiche list shall supplement Schedule 1 to the Agreement.
3. Conveyance of Receivables. The Trust does hereby transfer, assign,
set over and otherwise convey to the Transferor, without recourse, all right,
title and interest of the Trust in, to and under the Receivables existing at the
close of business on the Removal Notice Date and thereafter created from time to
time in the Removed Accounts designated hereby, all Interchange and Recoveries
related thereto, all monies due or to become due and all amounts received or
receivable with respect thereto and all proceeds thereof.
In connection with such transfer, the Trust agrees to execute and
deliver to the Transferor on or prior to the date this Reassignment is
delivered, applicable termination statements prepared by the Transferor with
respect to the Receivables existing at the close of business on the Removal Date
and thereafter created from time to time in the Removed Accounts reassigned
hereby and the proceeds thereof evidencing the release by the Trust of its
interest in the Receivables in the Removed Accounts, and meeting the
requirements of applicable state law, in such manner and such jurisdictions as
are necessary to terminate such interest.
4. Representations and Warranties of the Transferor. The Transferor
hereby represents and warrants to the Trust as of the Removal Date:
(a) Legal Valid and Binding Obligation. This Reassignment
constitutes a legal, valid and binding obligation of the Transferor
enforceable against the 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) Redemption Event; Event of Default. The Transferor
reasonably believes that (i) the removal of the Receivables existing in
the Removed Accounts will not, based on the facts known to the
Transferor, then or thereafter cause a Redemption Event or Event of
Default to occur with respect to any Series and (ii) the Removed
Accounts were selected randomly from all of the Accounts and no
selection procedure was utilized by the Transferor which would result
in a selection of Removed Accounts that would be materially adverse to
the interests of the Noteholders of any Series as of the Removal Date.
(c) List of Removed Accounts. The list of Removed Accounts
delivered pursuant to Section 2.10(a)(ii) of the Agreement, as of the
Removal Date, is true and complete in all material respects.
5. Ratification of Agreement. As supplemented by this Reassignment, the
Agreement is in all respects ratified and confirmed and the Agreement as so
supplemented by this Reassignment shall be read, taken and construed as one and
the same instrument.
B-2
6. 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 shall constitute one and the same
instrument.
7. GOVERNING LAW. THIS REASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS
CONFLICT OF LAWS PROVISIONS (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW) AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
8. Limitation of Liability. Notwithstanding any other provision herein
or elsewhere, this Reassignment has been executed and delivered by Wilmington
Trust Company, not in its individual capacity, but solely in its capacity as
Owner Trustee of the Trust, in no event shall Wilmington Trust Company in its
individual capacity have any liability in respect of the representations,
warranties, or obligations of the Trust hereunder or under any other document,
as to all of which recourse shall be had solely to the assets of the Trust, and
for all purposes of this Reassignment and each other document, the Owner Trustee
(as such or in its individual capacity) shall be subject to, and entitled to the
benefits of, the terms and provisions of the Trust Agreement.
B-3
IN WITNESS WHEREOF, the Transferor, the Servicer, the Trust and the
Indenture Trustee have caused this Reassignment to be duly executed by their
respective officers as of the day and year first above written.
NORDSTROM CREDIT CARD RECEIVABLES LLC,
as Transferor
By:
----------------------------------------
Name:
Title:
NORDSTROM fsb,
as Servicer
By:
----------------------------------------
Name:
Title:
NORDSTROM CREDIT CARD MASTER NOTE TRUST,
as Issuer
By: WILMINGTON TRUST COMPANY,
not in its individual capacity
but solely as Owner Trustee
By:
----------------------------------------
Name:
Title:
▇▇▇▇▇ FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION,
as Indenture Trustee
By:
----------------------------------------
Name:
Title:
B-4
EXHIBIT C
FORM OF ANNUAL SERVICER'S CERTIFICATE
(To be delivered on or before March 31 of
each calendar year beginning with March 31, 2003,
pursuant to Section 3.05 of the Transfer and
Servicing Agreement referred to below)
NORDSTROM CREDIT CARD MASTER NOTE TRUST
The undersigned, a duly authorized representative of Nordstrom fsb, as
Servicer (the "Servicer") and Nordstrom Credit Card Receivables LLC, as
Transferor (the "Transferor"), pursuant to the Transfer and Servicing Agreement,
dated as of April 1, 2002 (as amended and supplemented, the "Agreement"), among
Nordstrom Credit Card Receivables LLC, Nordstrom fsb, Nordstrom Credit Card
Master Note Trust and ▇▇▇▇▇ Fargo Bank Minnesota, National Association, does
hereby certify that:
1. Nordstrom fsb is, as of the date hereof, the Servicer under
the Agreement.
2. The undersigned is an Authorized Officer who is duly
authorized pursuant to the Agreement to execute and deliver this
Certificate to the Trust.
3. A review of the activities of the Servicer during the year
ended December 31, ____, and of its performance under the Agreement was
conducted under my supervision.
4. Based on such review, the Servicer has, to the best of my
knowledge, performed in all material respects its obligations under the
Agreement throughout such year and no default in the performance of
such obligations has occurred or is continuing except as set forth in
paragraph 5 below.
5. The following is a description of each default in the
performance of the Servicer's obligations under the provisions of the
Agreement known to me to have been made by the Servicer during the year
ended December 31, ____ which sets forth in detail (i) the nature of
each such default, (ii) the action taken by the Servicer, if any, to
remedy each such default and (iii) the current status of each such
default: [If applicable, insert "None."]
Capitalized terms used in this Certificate have their respective
meanings as set forth in the Agreement.
C-1
IN WITNESS WHEREOF, the undersigned has duly executed this Certificate
this ____ day of __________________, 20__.
NORDSTROM fsb,
as Servicer
By:
-------------------------------------
Name:
Title:
▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF OPINION OF COUNSEL
WITH RESPECT TO AMENDMENTS
Provisions to be included in
Opinion of Counsel to be delivered pursuant
to subsection 9.02(d)(i)
The opinions set forth below may be subject to all the qualifications,
assumptions, limitations and exceptions taken or made in the Opinions Of Counsel
delivered on any applicable Closing Date.
(i) The amendment to the Transfer and Servicing Agreement,
attached hereto as Schedule 1 (the "Amendment"), has been duly
authorized, executed and delivered by the Transferor and constitutes
the legal, valid and binding agreement of the Transferor, enforceable
in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance, fraudulent transfer and other
similar laws relating to or affecting creditors' rights generally and
general equitable principles (regardless of whether considered in a
proceeding in equity or at law), including concepts of commercial
reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief, and with
respect to the Nordstrom fsb, the rights and powers of the Federal
Deposit Insurance Corporation.
(ii) The Amendment has been entered into in accordance with
the terms and provisions of Section 9.01 of the Transfer and Servicing
Agreement.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
FORM OF OPINION OF COUNSEL
WITH RESPECT TO ACCOUNTS
Provisions to be included in
Opinion of Counsel to be
delivered pursuant to
Section 9.02(d)(ii) or (iii)
The opinions set forth below may be subject to all the qualifications,
assumptions, limitations and exceptions taken or made in the Opinions of Counsel
delivered on any applicable Closing Date.
(i) To the extent that the transfer of Additional Receivables
by the Transferor to the Trust pursuant to the Assignment does not
constitute an absolute assignment by the Transferor to the Trust of
such Additional Receivables or the proceeds thereof, the Assignment
creates in favor of the Trust a security interest in the rights of the
Transferor in such Additional Receivables and the proceeds thereof.
(ii) The security interests described in paragraph 1 above is
perfected by filing and there is no security interest prior to the
security interest of the Trust.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
PROVISIONS TO BE INCLUDED IN
ANNUAL OPINION OF COUNSEL
The opinions set forth below may be subject to all the qualifications,
assumptions, limitations and exceptions taken or made in the Opinions of Counsel
delivered on any applicable Closing Date with respect to similar matters. Unless
otherwise indicated, all capitalized terms used herein has the meanings ascribed
to them in the Transfer and Servicing Agreement.
(i) No filing or other action, other than such filing or other
action described in such opinion, is necessary from the date of such
opinion through April 30 of the following year to continue the
perfected status of the security interest of the Trust in the
Receivables described in the financing statements referenced in such
opinion.
D-3-1
SCHEDULE 1
LIST OF ACCOUNTS
[Original list delivered to Owner Trustee]
S-1-1