▇ ▇ ▇ ▇ ▇ ▇ ▇ ▇ LIMITED LIABILITY PARTNERSHIP
C H A N C E
CONFORMED COPY
HSBC BANK PLC
as Transferor and Offeror
TURQUOISE RECEIVABLES TRUSTEE LIMITED
as Receivables Trustee
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RECEIVABLES SECURITISATION DEED
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CONTENTS
CLAUSE PAGE
1. Interpretation...............................................................................3
2. Offer Of Receivables.........................................................................5
3. Acceptance Of Offer And Payment For Existing Receivables.....................................7
4. Assignment Of Receivables....................................................................8
5. Payment Of Further Payment, Payment For Future Receivables And Deferred Consideration........9
6. Perfection And Directions As To Payment......................................................9
7. Redesignation And Removal Of Accounts.......................................................11
8. Discount Percentage, Special Fees, Annual Fees And Acquired Interchange.....................13
9. Trust - Failure Of Assignment...............................................................15
10. Reductions In Receivables, Early Collections, Credit Adjustments............................15
11. Breach Of Warranty And Ineligible Receivables...............................................16
12. Currency Of Account And Payment.............................................................18
13. Payments By The Transferor And The Receivables Trustee......................................18
14. Card Operating Account, Card Proceeds Account And Acceptance Price Account..................20
15. The Trustee Collection Account..............................................................20
16. Representations.............................................................................20
17. Covenants...................................................................................21
18. Call Option.................................................................................23
19. Non-Petition................................................................................24
20. Benefit Of Deed.............................................................................24
21. Disclosure Of Information...................................................................25
22. Remedies And Waivers........................................................................25
23. Partial Invalidity..........................................................................26
24. Counterparts................................................................................26
25. Notices.....................................................................................26
26. Termination Of Receivables Trust Deed And Servicing Agreement...............................26
27. Law.........................................................................................27
28. Jurisdiction................................................................................27
29. Rights Of Third Parties.....................................................................27
SCHEDULE 1 ELIGIBLE ACCOUNTS...................................................................28
SCHEDULE 2 ELIGIBLE RECEIVABLES................................................................30
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SCHEDULE 3 FORM OF OFFER.......................................................................31
SCHEDULE 4 CONDITIONS PRECEDENT TO SUBSEQUENT OFFERS...........................................34
SCHEDULE 5 REPRESENTATIONS.....................................................................35
SCHEDULE 6 NOTIFICATION EVENTS.................................................................39
SCHEDULE 7 FORM OF SOLVENCY CERTIFICATE........................................................40
SCHEDULE 8 FORM OF NOTICE OF ASSIGNMENT........................................................42
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THIS DEED is made on the 23 May 2006
BY AND BETWEEN
(1) HSBC BANK PLC, a company registered in England and Wales (registered
number 14259) having its registered office at ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇
▇▇▇ (in this capacity, the "OFFEROR" and "TRANSFEROR"); and
(2) TURQUOISE RECEIVABLES TRUSTEE LIMITED, a company incorporated in Jersey
with registration number 92324 and having its registered office at ▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇ (the "RECEIVABLES TRUSTEE" which shall include
its permitted successors as trustee or trustees of the Receivables Trust).
WHEREAS
(A) The Transferor has owed to it at present and expects to have owed to it in
the future Receivables arising in the course of its business.
(B) The Transferor and the Receivables Trustee have agreed, upon the terms and
subject to the conditions of this Deed, that for the purposes of
facilitating a possible securitisation, the Transferor may from time to
time offer to assign all Receivables (both Existing Receivables and Future
Receivables) arising on Accounts nominated to become Designated Accounts
to the Receivables Trustee and the Receivables Trustee may, if it so
determines, from time to time accept any such offer in the manner provided
for in Clause 3.4.
(C) It is acknowledged by all the parties hereto that any assignment made or
to be made in consequence of any acceptance of any Offer made pursuant to
this Deed will take effect at all times as an equitable assignment unless
and until a Notice of Assignment is given in respect of it in accordance
with Clause 6.6 and any other actions necessary to perfect the assignment
have been taken.
NOW IT IS HEREBY AGREED as follows:
1. INTERPRETATION
1.1 Whenever used in this Deed, the words and phrases defined in the Master
Definitions Schedule set out in Schedule 6 of the Receivables Trust Deed
and Servicing Agreement of even date herewith the parties hereto shall,
unless otherwise defined herein or the context requires otherwise, bear
the same meanings herein (including the recitals hereto).
1.2 In this Deed:
1.2.1 a "CLAUSE" or "SCHEDULE" is, subject to any contrary indication, a
reference to a Clause hereof or a schedule hereto;
1.2.2 "STAMP DUTY" shall be construed as a reference to any stamp,
registration or other transaction or documentary tax (including,
without limitation, any penalty or interest payable in connection
with any failure to pay or any delay in paying any of the same);
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1.2.3 the "ADMINISTRATION", "BANKRUPTCY", "DISSOLUTION", "INSOLVENCY",
"LIQUIDATION", "RECEIVERSHIP" or "WINDING-UP" of any person shall
be construed so as to include any equivalent or analogous
proceedings under the laws of the jurisdiction in which such
person is incorporated (or, if not a company or corporation,
domiciled) or any jurisdiction in which such person carries on
business.
1.2.4 "(POUND)" and "STERLING" denote the lawful currency for the time
being of the United Kingdom of Great Britain and Northern Ireland.
1.3 Save where the contrary is indicated, any reference in this Deed to:
1.3.1 this Deed or any other agreement or document shall be construed as
a reference to this Deed or, as the case may be, such other
agreement or document as the same may have been, or may from time
to time be, amended, varied, novated or supplemented. References
in this Deed to any party shall include references to that party's
successors and permitted assigns;
1.3.2 a statute shall be construed as a reference to such statute as the
same may have been, or may from time to time be, amended or
re-enacted; and
1.3.3 time of day (including opening and closing of business) shall be
construed as a reference to London time.
1.4 Clause and Schedule headings are for ease of reference only.
1.5 VAT:
1.5.1 All sums payable by the Receivables Trustee to the Transferor
hereunder are inclusive of any VAT which is chargeable on the
supply or supplies for which such sums (or any part thereof) are
the whole or part of the consideration for VAT purposes and
section 89 of the VATA shall not apply to affect the amount of
such sums; and
1.5.2 all sums payable by the Transferor (the "PAYER") to the
Receivables Trustee (the "PAYEE") are exclusive of any VAT which
is chargeable on the supply or supplies for which such sums (or
any part thereof) are the whole or part of the consideration for
VAT purposes. Where the Payee makes a supply to the Payer for VAT
purposes pursuant hereto and VAT is or becomes chargeable on such
supply and the Payee is required to account to HM Revenue &
Customs for such VAT, the Payer shall pay to the Payee (in
addition to any other consideration for such supply) a sum equal
to the amount of such VAT, such payment to be made no later than 2
Business Days before the last day (as notified to the Payer in
writing by the Payee) on which the Payee can account to HM Revenue
& Customs for such VAT without incurring any interest or
penalties.
1.5.3 Any reference herein to any fee, cost, disbursement, expense or
liability incurred by any party and in respect of which such party
is to be reimbursed (or indemnified) by any other person or the
amount of which is to be taken into
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account in any calculation or computation shall, save where the
context otherwise requires, include:
(a) where such party is the Receivables Trustee, a reference to
such part of such fee, cost, disbursement, expense or
liability as represents VAT, and any VAT for which such
party is required to account to HM Revenue & Customs under
Section 8 of the VATA in relation to such fee, cost,
disbursement, expense or liability; and
(b) where such party is the Transferor, a reference to such part
of such fee, cost, disbursement, expense or liability as
represents VAT save to the extent that such party is
entitled to obtain credit or repayment in respect of such
VAT from HM Revenue & Customs, and any VAT for which such
party is required to account to HM Customs and Excise under
Section 8 of the VATA in relation to such fee, cost,
disbursement, expense or liability.
1.6 Any reference herein to a party shall (where appropriate) be deemed, at
any time when such party is treated as a member of a group for the
purposes of section 43 to 43D of the VATA and the Value Added Tax (Groups:
eligibility) Order 2004, to include a reference to the representative
member of such group.
2. OFFER OF RECEIVABLES
2.1 The Offeror may nominate any Account to become a Designated Account by
identifying it as a nominated Account in its records. The Offeror may at
any time after the date hereof (subject to receipt by the Receivables
Trustee of the documents referred to in the Closing Documents List in form
and substance satisfactory to the Receivables Trustee), by delivering to
the Receivables Trustee in accordance with Clause 2.3 an Offer
substantially in the form set out in Schedule 3, thereby offer to the
Receivables Trustee in respect of the initial Proposed Addition Date
specified in such Offer an assignment of:
2.1.1 all Existing Receivables, under each Account nominated in respect
of such Offer to become a Designated Account, as of the opening of
business on the initial Proposed Addition Date;
2.1.2 all Future Receivables under each such Account nominated in
respect of such Offer to become a Designated Account which are not
Finance Charge Receivables in respect of Principal Receivables and
which arise before the earliest of:
(a) in respect of each such Account, such time (if any) as such
Account becomes a Redesignated Account;
(b) the termination of the Receivables Trust; or
(c) the occurrence of an Insolvency Event;
2.1.3 all Future Receivables under each Account nominated in respect of
such Offer to become a Designated Account which are Finance Charge
Receivables arising in respect of Receivables which are offered in
accordance with Clauses 2.1.1 and 2.1.2;
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2.1.4 (to the extent such are capable of assignment) the benefit of, and
any proceeds arising from, each guarantee or insurance policy
obtained by the Transferor in respect of the obligations of an
Obligor to make payments on any Account nominated in respect of
such Offer to become a Designated Account, including all Insurance
Proceeds; and
2.1.5 Acquired Interchange in respect of each Monthly Period,
Provided however that prior to making any Offer under this Clause 2.1 the
Offeror shall provide to the Receivables Trustee a Solvency Certificate
substantially in the form of Schedule 7.
2.2 The Offeror may, from time to time following the initial Offer Date but
prior to the termination of the Receivables Trust, nominate any Account to
become a Designated Account. An Account shall be nominated by the
Transferor by identifying it as a nominated Account in its records. On any
subsequent Offer Date, the Offeror may, by delivering to the Receivables
Trustee in accordance with Clause 2.3 an Offer substantially in the form
set out in Schedule 3, offer to the Receivables Trustee in respect of the
related Proposed Addition Date an assignment of:
2.2.1 all Existing Receivables, under each Account nominated in such
Offer to become a Designated Account, as at the opening of
business on the related Proposed Addition Date; and
2.2.2 all Future Receivables under each Account nominated in respect of
such Offer to become a Designated Account which are not Finance
Charge Receivables in respect of Principal Receivables and which
arise before the earliest of:
(a) in respect of each such Account, such time (if any) as such
Account becomes a Redesignated Account;
(b) the termination of the Receivables Trust; or
(c) the occurrence of an Insolvency Event;
2.2.3 all Future Receivables under each Account nominated in respect of
such Offer to become a Designated Account which are Finance Charge
Receivables in respect of Receivables which are offered in
accordance with Clauses 2.2.1 and 2.2.2; and
2.2.4 (to the extent such are capable of assignment) the benefit of, and
any proceeds arising from, each guarantee or insurance policy
obtained by the Transferor in respect of the obligations of an
Obligor to make payments on any Account nominated in any such
Offer to become a Designated Account, including all Insurance
Proceeds,
PROVIDED, HOWEVER, that prior to the making of each such Offer under this
Clause 2.2, the Transferor shall have satisfied the conditions precedent
set out in Schedule 4 save for such conditions precedent have been waived
in writing by the Receivables Trustee if it has received written
confirmation from each relevant Rating Agency that such waiver
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will not result in a withdrawal or reduction in the then current rating
given by such Rating Agency of any Associated Debt.
2.3 Each Offer delivered by the Offeror shall:
2.3.1 specify that each Account identified in such Offer has been
identified in the records of the Offeror as an Account in respect
of which an assignment of Existing Receivables and Future
Receivables is being offered to the Receivables Trustee;
2.3.2 be delivered on the Offer Date relating thereto; and
2.3.3 without prejudice to Clause 3.3, constitute an offer by the
Offeror to sell and assign to the Receivables Trustee absolutely
all of the Offeror's right, title and interest in and to the
Existing Receivables under each Account nominated in the Offer as
of the opening of business on the Proposed Addition Date and
Future Receivables arising on each such Account thereafter, at the
related Purchase Price therefor, on the terms and conditions of
this Deed, together with (to the extent such are capable of
assignment) the benefit of each guarantee or insurance policy
obtained by the Transferor in respect of the obligations of an
Obligor to make payments on any such Receivables and, in the case
of the Offer pursuant to Clause 2.1, Acquired Interchange in
respect of each Monthly Period.
2.4 The Transferor agrees that if any Offer is revoked in whole or in respect
of certain nominated Accounts only before it is accepted in accordance
with Clause 3.4, it will ensure that any Account which is nominated in
such Offer in respect of which the Offer is revoked (and which is not
thereafter nominated in any subsequent Offer which is accepted) will not
be identified or treated for any purpose as being a Designated Account.
2.5 The Offeror agrees that it shall in respect of any Offer made to the
Receivables Trustee in accordance with Clause 2.3 provide to the
Receivables Trustee as soon as reasonably practicable following the
Proposed Addition Date a list of the Accounts which were nominated by the
Offeror in such Offer (and shall make such information available to the
Servicer).
3. ACCEPTANCE OF OFFER AND PAYMENT FOR EXISTING RECEIVABLES
3.1 The Receivables Trustee may accept any Offer made in accordance with
Clauses 2.1 to 2.3 in the manner specified in Clause 3.4.
3.2 Each Offer may be accepted by the Receivables Trustee, insofar as it
relates to Receivables, only with respect to the Existing Receivables and
Future Receivables on nominated Accounts referred to therein in respect of
which such Offer has not been revoked, and any purported form of
acceptance of an Offer otherwise than in the manner specified in Clause
3.4 shall be null and void and of no effect (and for the avoidance of
doubt nothing in this Deed or in any Offer shall of itself operate so as
to convey or transfer to any Person any beneficial interest in any
Receivables).
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3.3 Each Offer shall be revocable, in whole or in respect of certain nominated
Accounts only, from the date such Offer is made and may be revoked by the
Offeror in writing addressed to the Receivables Trustee until such time
(if any) as the date such Offer is accepted (if at all).
3.4 Each Offer which has not been revoked in whole in accordance with Clause
3.3 may be accepted on the date specified in such Offer being a Business
Day (such date, the "PROPOSED ADDITION DATE"), by payment in cash by or on
behalf of the Receivables Trustee to the Offeror of the Acceptance Price.
If such Offer is not accepted on the Proposed Addition Date it shall lapse
at the close of business on such date and shall not be capable of
acceptance thereafter. The Receivables Trustee shall not give any
instructions for the payment of the Acceptance Price prior to the time
falling one hour after it has received notification of the Outstanding
Face Amount of the Existing Receivables pursuant to Clause 9.5(a)(ix) of
the Receivables Trust Deed and Servicing Agreement.
4. ASSIGNMENT OF RECEIVABLES
4.1 Upon acceptance of an Offer pursuant to Clause 3.4 each Account nominated
in respect of such Offer (and in respect of which such Offer has not been
revoked) shall thereafter be a Designated Account (until such time, if
any, as such Account becomes a Redesignated Account) and all of the
Transferor's rights, title and interest in and to:
4.1.1 the Existing Receivables under such Designated Account;
4.1.2 the Future Receivables under such Designated Account which are not
Finance Charge Receivables in respect of Principal Receivables and
which arise before the earliest of:
(a) such time (if any), as such Designated Account becomes a
Redesignated Account;
(b) the termination of the Receivables Trust; or
(c) the occurrence of an Insolvency Event;
4.1.3 all Future Receivables under such Designated Account which are
Finance Charge Receivables in respect of Receivables which are
assigned (or purported to be assigned) to the Receivables Trustee
pursuant to paragraphs 4.1.1 and 4.1.2 above;
4.1.4 (to the extent such are capable of assignment) the benefit of, and
any proceeds arising from, each guarantee or insurance policy (if
any) obtained by the Transferor in respect of the obligations of
an Obligor to make payments on such Designated Account, including
all Insurance Proceeds; and
4.1.5 (in respect of the Offer pursuant to Clause 2.1) Acquired
Interchange in respect of each Monthly Period,
shall thereupon vest in the Receivables Trustee on the terms and
conditions of this Deed and the Offer.
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4.2 For the avoidance of doubt, any assignment made pursuant to the acceptance
of an Offer will take effect in equity only unless and until a Notice of
Assignment has been given in respect of it in accordance with the
provisions of Clause 6.6 and such other action is taken as is necessary to
perfect such assignment.
5. PAYMENT OF FURTHER PAYMENT, PAYMENT FOR FUTURE RECEIVABLES AND DEFERRED
CONSIDERATION
5.1 Where a contract is constituted by acceptance of an Offer in the manner
specified in Clause 3.4, the Receivables Trustee shall pay the Further
Payment to the Offeror immediately after such acceptance.
5.2 In consideration of the assignment by the Transferor to the Receivables
Trustee of Future Receivables coming into existence on any day (which
Receivables will have vested in equity in the Receivables Trustee subject
to Clauses 7.4.3 and 7.4.4) and Acquired Interchange in respect of each
Monthly Period, the Receivables Trustee shall pay to the Transferor (and,
in respect of the amount to be paid in cash, in accordance with Clause
6.3), not later than the Business Day which is two Business Days after the
Date of Processing relating to such Future Receivables or such longer
period of time as may be agreed upon by the Transferor and the Receivables
Trustee (if it has received written confirmation from each relevant Rating
Agency that such longer time period will not result in such Rating Agency
reducing or withdrawing the then current rating given by such Rating
Agency of any outstanding Associated Debt), an amount equal to the
Outstanding Face Amount of the Principal Receivables comprised in such
Future Receivables, as calculated by the Transferor and notified to the
Receivables Trustee by the Transferor (and specifying the aggregate amount
of any such Principal Receivables which are Ineligible Receivables) by no
later than 12.00 noon on such day for payment.
5.3 By way of further consideration for the assignment of Receivables on
Designated Accounts and Acquired Interchange by the Transferor to the
Receivables Trustee, the Receivables Trustee shall make payments of
Deferred Consideration to the Transferor on each Transfer Date in respect
of which such Deferred Consideration is calculated to be payable. The
amount of Deferred Consideration payable shall be calculated by the
Servicer in accordance with the Receivables Trust Deed and Servicing
Agreement and the related Supplements.
5.4 For the avoidance of doubt, the purchase price ("PURCHASE PRICE") in
respect of any assignment of Existing Receivables referred to in an Offer
which has been accepted in accordance with Clause 3.4 shall equal the
aggregate of (i) the Acceptance Price in respect of such Offer, (ii) all
amounts payable pursuant to Clauses 5.1 and 5.2 (whether or not payable in
cash) and (iii) the Deferred Consideration payable in accordance with
Clause 5.3.
6. PERFECTION AND DIRECTIONS AS TO PAYMENT
6.1 If the Receivables Trustee determines to accept an Offer on the Proposed
Addition Date in respect thereof then the Acceptance Price payable to the
Transferor in accordance with Clause 3.4 in order to accept such Offer
shall be paid by the Receivables Trustee into the Acceptance Price
Account.
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6.2 The obligation of the Receivables Trustee to pay the Further Payment to
the Transferor pursuant to Clause 5.1 shall be satisfied by:
6.2.1 payment of the amount of Further Payment to be made in cash into
the Card Proceeds Account; and
6.2.2 to the extent the amount of such Further Payment is not made in
cash, an increase in the Transferor Interest in the Receivables
Trust or an increase in the Transferor Ineligible Interest in the
Receivables Trust (as applicable) pursuant to Clause 5.2(c)(ii) of
the Receivables Trust Deed and Servicing Agreement,
such payment or increase when so made or effected to constitute compliance
by the Receivables Trustee with Clause 5.1 in respect of the Existing
Receivables in respect of which the payment is made.
6.3 Each payment due to the Transferor pursuant to Clause 5.2 in respect of
Future Receivables, shall be satisfied by payment of the relevant amount
into the Card Proceeds Account, such payment when so made to constitute
compliance by the Receivables Trustee with Clause 5.2 in respect of the
Future Receivables, in respect of which the payment is made (subject
always to the provisions of Clause 13.3).
6.4 Subject to Clause 6.6, the Transferor will take all such steps and comply
with all such formalities as the Receivables Trustee may require to
perfect or more fully to evidence or secure title to the Receivables and
Acquired Interchange (and the benefit of any guarantee or insurance policy
in respect of the obligations of an Obligor to make payments in respect
thereof) assigned (or purported to be assigned) pursuant to Clause 4 and
the interest of the Receivables Trustee therein.
6.5 Subject to Clause 6.6, to secure the proprietary interest of the
Receivables Trustee relating to the Receivables and Acquired Interchange
(and the benefit of any guarantee or insurance policy in respect of the
obligations of an Obligor to make payments in respect thereof) assigned
(or purported to be assigned) to it by the Transferor and the performance
of the Transferor's obligations in respect thereof, the Transferor hereby
irrevocably appoints by way of security the Receivables Trustee as it
attorney (with full power of delegation) for the purpose of performing and
complying with all and any of such obligations of the Transferor, whether
in the name of the Transferor, or in the name of the Receivables Trustee,
and in such manner as the Receivables Trustee may consider appropriate,
and the Transferor hereby ratifies, confirms and adopts and agrees to
ratify, confirm and adopt whatsoever the Receivables Trustee shall do or
purport to do on its behalf by virtue of and in accordance with this power
of attorney, except in the case of bad faith, fraud or gross negligence on
the part of the Receivables Trustee in so acting.
6.6 The Receivables Trustee (whether in its capacity as donee of the power of
attorney in Clause 6.5 or otherwise) hereby agrees that:
6.6.1 no Notice of Assignment or any other notice in whatever form of
the assignment to the Receivables Trustee of Receivables relating
to any Obligor and, if applicable, the benefit of any related
guarantee or insurance policy shall be given by it (or required by
it to be given) to any such Obligor or any provider
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of any guarantee or insurance policy in respect of the obligations
of such Obligor; and
6.6.2 no written assignment or transfer (whether by deed or otherwise)
of any Receivables (or any guarantee or insurance policy in
respect of the obligations of an Obligor to make payments in
respect thereof) assigned (or purported to be assigned) shall be
required,
unless a Notification Event has occurred and is then subsisting and such
action is required in the opinion of the Receivables Trustee (after
consulting with such legal advisers as it deems necessary) to give effect
to the obligations of the Transferor under Clause 6.4. For the avoidance
of doubt the parties acknowledge that, unless and until a Notice of
Assignment is given following a Notification Event and in relation thereto
or such other action is taken as is necessary to perfect the assignment or
transfer, all assignments or transfers of Receivables pursuant to
acceptance of Offers will take effect at all times in equity only.
6.7 The Receivables Trustee shall not be entitled to create, assume or incur
indebtedness or other liabilities as trustee of the Receivables Trust
other than as contemplated in this Deed, the Receivables Trust Deed and
Servicing Agreement, any Supplement thereto and any document related
thereto.
7. REDESIGNATION AND REMOVAL OF ACCOUNTS
7.1 Each Designated Account shall continue to be a Designated Account until
such time, if any, that it becomes a Redesignated Account on the date
specified in respect of such Designated Account pursuant to Clause 7.3
(the "REDESIGNATION DATE").
7.2 Subject to Clause 7.5, the Transferor may at any time notify the
Receivables Trustee in writing of any Designated Account which has become
eligible to be redesignated pursuant to Clause 7.5, and which the
Transferor wishes to redesignate as a Redesignated Account with effect
from such Redesignation Date as the Transferor shall specify in that
notice (a "REDESIGNATION NOTICE"). PROVIDED THAT, for the avoidance of
doubt, such Redesignation Notice shall not be in respect of any Eligible
Receivables then outstanding on such Designated Account.
7.3 The Redesignation Date of a Designated Account shall be ascertained as
follows:
7.3.1 in the case of a Zero Balance Account, the Redesignation Date
shall be the day on which the relevant Designated Account is
recorded by the Servicer as being a Zero Balance Account and
removed from the Servicer's computer master file of Accounts;
7.3.2 in the case of a Defaulted Account, the Redesignation Date shall
be the day on which the Receivables thereunder are recorded as
charged-off on the Servicer's computer master file of Accounts.
Notwithstanding any other provision hereof, any Receivables on a
Defaulted Account that are Ineligible Receivables prior to such
date shall be treated as Ineligible Receivables rather than as
Receivables on Defaulted Accounts; and
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7.3.3 in the case of a Designated Account which is not a Defaulted
Account or Zero Balance Account, the Redesignation Date shall be
the day specified in the Redesignation Notice.
7.4 On, and with effect from, the Redesignation Date in respect of a
Designated Account the following shall occur:
7.4.1 such Account shall cease to be a Designated Account and thereafter
shall be a Redesignated Account;
7.4.2 all Receivables which were in existence prior to the Redesignation
Date shall, to the extent the Receivables Trustee has not paid for
such Receivables, be paid for by the Receivables Trustee in
accordance with this Deed;
7.4.3 all Receivables generated on such Redesignated Account which would
have been, if such Redesignated Account had been a Designated
Account, Future Receivables, and either are (i) Principal
Receivables or (ii) Finance Charge Receivables other than those
referred to in Clause 7.4.4, shall not, in either case, be
assigned by the Transferor to the Receivables Trustee; and
7.4.4 all Future Receivables which are Finance Charge Receivables in
respect of Receivables which were in existence prior to such
Redesignation Date, which Future Receivables come into existence
on or following such Redesignation Date, shall continue to be
automatically assigned by the Transferor to the Receivables
Trustee and constitute Trust Property,
PROVIDED, HOWEVER, that, for the avoidance of doubt in the case of
Receivables which are assigned to the Receivables Trustee on the basis
that the same are Eligible Receivables, no Receivable assigned to the
Receivables Trustee shall be reassigned to the Transferor except in the
circumstances set out in Clause 11.3 or the Receivables Trust Deed and
Servicing Agreement.
7.5 The Transferor shall not be permitted to redesignate Designated Accounts
pursuant to Clause 7.2 which are not Defaulted Accounts (except for
Defaulted Accounts the Receivables in which have been assigned pursuant to
the Receivables Trust Deed and Servicing Agreement) or Zero Balance
Accounts unless the additional conditions in this Clause 7.5 are met:
7.5.1 the Designated Account is a Cancelled Account; or
7.5.2 all of the following conditions are satisfied:
(a) such redesignation shall not, in the reasonable belief of
the Transferor, cause a Pay Out Event to occur;
(b) the Transferor shall represent and warrant to the
Receivables Trustee that : (1) the Designated Accounts to be
redesignated have been selected by the Transferor at random,
and (2) the Transferor has secured all necessary regulatory
consents for the Designated Accounts to be redesignated;
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(c) on or before the tenth Business Day prior to the
Redesignation Date, each Rating Agency and the Receivables
Trustee shall have received notice in writing from the
Transferor of such proposed redesignation and the Transferor
and the Receivables Trustee shall have received written
notice prior to the Redesignation Date from each Rating
Agency that such proposed redesignation will not result in a
downgrade or withdrawal of its then current rating of any
outstanding Associated Debt;
(d) the Transferor and the Servicer shall certify to the
Receivables Trustee that Collections (equal to the
Outstanding Face Amount of each Principal Receivable and
Finance Charge Receivable) have been received by the
Receivables Trustee in respect of every Receivable which has
been assigned to the Receivables Trustee in respect of that
Account other than Defaulted Receivables; and
(e) the Transferor shall have delivered to the Receivables
Trustee an Officer's Certificate confirming the items set
out in Clauses 7.5.1(a) to (d),
PROVIDED HOWEVER that the Receivables Trustee may conclusively
rely on the Officer's Certificate referred to in Clause 7.5.1(e)
without making enquiries with regard to the matters set out
therein.
7.6 The parties to this Deed hereby agree and acknowledge that the Transferor
may request that the Servicer designate certain Designated Accounts or
Redesignated Accounts to be Removed Accounts (in accordance with Clause
9.9 of the Receivables Trust Deed and Servicing Agreement) if, but only
if, such request is made by the Transferor solely in response to a third
party action or decision not to act which binds it to make such request,
and is not the unilateral action of the Transferor.
8. DISCOUNT PERCENTAGE, SPECIAL FEES, ANNUAL FEES AND ACQUIRED INTERCHANGE
8.1 The Transferor may at any time, by giving not less than 30 days' prior
notice in writing to the Servicer, the Receivables Trustee and the Rating
Agencies, nominate a Discount Percentage to apply to Principal Receivables
from the date specified in such notice for such period (or additional
period) of time as the Transferor shall specify.
8.2 If the Transferor notifies the Receivables Trustee of the application of a
Discount Percentage in accordance with Clause 8.1 then, during the period
of time specified by the Transferor under Clause 8.1, the relevant amount
of any Further Payment to be paid pursuant to Clause 5.1 shall accordingly
be reduced by a percentage equal to the Discount Percentage, and the
obligation of the Receivables Trustee to make the payments referred to in
Clause 5.3 shall be likewise reduced.
8.3 No nomination by the Transferor pursuant to Clause 8.1 of a Discount
Percentage or the period (or additional period) of time for which it is to
be effective shall be of any effect unless:
8.3.1 each Rating Agency has confirmed in writing that such proposed
nomination or increase in length of the relevant period will not
result in a downgrade or
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withdrawal of its then current rating or ratings of any
outstanding Associated Debt;
8.3.2 the Transferor has provided the Receivables Trustee with an
Officer's Certificate in the form set out in Schedule 7, signed by
an Authorised Officer confirming that:
(a) the performance of the portfolio of Designated Accounts is
such that in the reasonable opinion of the Transferor the
yield of Finance Charge Collections is not generating
adequate cashflows to the Beneficiaries of the Receivables
Trust, and the size of the Discount Percentage is not
intended solely to accelerate amounts paid to the Transferor
as Deferred Consideration; and
(b) the Transferor is able to pay its debts within the meaning
of section 123 of the Insolvency ▇▇▇ ▇▇▇▇ and will not
become unable to pay its debts within the meaning of that
section in consequence of such Discount Percentage coming
into effect, as at the date on which the Discount Percentage
or additional period is to take effect.
8.4 From time to time the Transferor may levy a Special Fee on Accounts
(including Designated Accounts) in respect of all or certain types of
Receivables arising thereon, whether at one time or on an ongoing basis,
and may in respect of such Special Fees on or after the date on which they
are first levied, designate in a certificate to the Receivables Trustee
whether such Special Fees shall be treated as Finance Charge Receivables
or as Principal Receivables, PROVIDED, HOWEVER, that (i) in the absence of
such certificate, such Special Fees shall be treated as Finance Charge
Receivables and Collections in respect thereof shall be treated as Finance
Charge Collections and (ii) any such certificate shall have effect only in
relation to Receivables which are acquired by the Receivables Trustee
(whether as Existing Receivables or as Future Receivables) after the time
when such certificate is issued, PROVIDED FURTHER, HOWEVER, that the
Transferor may not designate Special Fees as Principal Receivables unless
it certifies in such certificate that it has received an Opinion of
Counsel that such Special Fees constitute, for the purpose of tax in the
United Kingdom, repayment in whole or in part of an advance to an Obligor.
8.5 The Transferor may, at any time by giving notice in writing to the
Servicer, the Receivables Trustee and the Rating Agencies, designate in a
certificate to the Receivables Trustee whether Future Receivables arising
after that time and Existing Receivables comprised in Offers accepted by
the Receivables Trustee after that time in respect of Annual Fees shall be
treated as Finance Charge Receivables or as Principal Receivables
PROVIDED, HOWEVER, that in the absence of such certificate, such
Receivables in respect of Annual Fees shall be treated as Finance Charge
Receivables, PROVIDED FURTHER, HOWEVER, that any designation of Annual
Fees as Principal Receivables shall not be of any effect unless the
Transferor certifies in such certificate that it has received an Opinion
of Counsel that such Annual Fees constitute, for the purpose of tax in the
United Kingdom, repayment in whole or in part of an advance to an Obligor.
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8.6 On or before each Transfer Date, the Transferor shall notify the
Receivables Trustee of the amount of Acquired Interchange in respect of
the preceding Monthly Period.
8.7 On each Transfer Date, the Transferor shall cause to be paid to the
Receivables Trustee by depositing into the Trustee Collection Account, in
immediately available funds, the amount representing payments of Acquired
Interchange with respect to the immediately preceding Monthly Period.
9. TRUST - FAILURE OF ASSIGNMENT
9.1 If for any reason any Receivable arising on a Designated Account cannot be
duly assigned to the Receivables Trustee as contemplated hereby but the
Receivables Trustee has accepted the Offer relating to that Receivable
then, with effect from the date on which the Receivables Trustee accepted
such Offer, that Receivable shall be treated as if it had been validly and
duly assigned to the Receivables Trustee and the Transferor shall hold the
same and all Collections related thereto on trust absolutely for the
Receivables Trustee and all such Collections shall be applied as if such
Receivable had been validly and duly assigned.
9.2 The provisions of Clause 9.1 and 9.4 shall be without prejudice to:
9.2.1 any obligations or representations of the Transferor under this
Deed or made in respect of any Offer in relation to any
Receivables; and
9.2.2 any liabilities of the Transferor or rights of the Receivables
Trustee in relation to any breach or inaccuracy on the part of the
Transferor of the matters referred to in Clause 9.2.1.
9.3 All Collections in respect of any Receivables constituting Trust Property
received by the Transferor (whether or not the appointment of HSBC as
Servicer under the Receivables Trust Deed and Servicing Agreement has been
terminated) shall, pending their application to the Trustee Collection
Account, be held on trust for and to the order of the Receivables Trustee.
9.4 If for any reason Acquired Interchange cannot be duly assigned to the
Receivables Trustee as contemplated hereby but the Receivables Trustee has
accepted an Offer relating to such Acquired Interchange then, with effect
from the date on which the Receivables Trustee accepted such Offer,
Acquired Interchange shall be treated as if it had been validly and duly
assigned to the Receivables Trustee and the Transferor shall hold the same
and all amounts related thereto on trust absolutely for the Receivables
Trustee and all such amounts shall be applied as if such Acquired
Interchange had been validly and duly assigned.
10. REDUCTIONS IN RECEIVABLES, EARLY COLLECTIONS, CREDIT ADJUSTMENTS
10.1 If the amount paid or payable in respect of any Principal Receivable which
has been assigned by the Transferor to the Receivables Trustee is reduced
(other than in respect of a Transferor Section 75 Liability or other
Credit Adjustment) after the Addition Date relating thereto by reason of:
10.1.1 any set-off or counterclaim as between an Obligor and the
Transferor; or
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10.1.2 any other matter as between an Obligor and the Transferor,
(each of 10.1.1 and 10.1.2 above a "REDUCTION")
and the Transferor has received a benefit in money or money's worth as a
consequence of such Reduction (including, without limitation, any
reduction in any liability owing by the Transferor to such Obligor) then
the Transferor shall nevertheless for the purposes of this Deed be treated
as having been paid the amount of such Reduction on the date of such
Reduction in addition to any other amounts which may be paid or payable in
respect of such Receivable.
10.2 If any Existing Receivable which is purported to be assigned pursuant to
any Offer made pursuant to the terms of this Deed shall have been
collected in whole or in part prior to the time of such purported
assignment, then the portion thereof which shall have been so collected
(an "EARLY COLLECTION") shall be treated for the purposes of this Deed as
having been collected by the Transferor immediately following such
purported assignment.
10.3 If any part of the Outstanding Face Amount of any Principal Receivable
assigned by the Transferor to the Receivables Trustee has been (i) created
in respect of any merchandise refused or returned by the Obligor or as to
which the Obligor has asserted any defence, dispute, set-off or
counterclaim (including a Transferor Section 75 Liability) or (ii) reduced
by the Transferor or the Servicer by any rebate, refund, charge-back or
adjustment (including Servicer billing errors) or (iii) created as a
result of a fraudulent or counterfeit charge, (in each case such amount
being a "CREDIT ADJUSTMENT"), then the Transferor shall nevertheless for
the purposes of this Deed be treated as having been paid the amount of
such Credit Adjustment on the date of such Credit Adjustment in addition
to any other amounts which may be paid or payable in respect of such
Principal Receivable, PROVIDED THAT where any amount has been paid
pursuant to Clause 10.1 in respect of a Reduction such amount shall not be
regarded as a Credit Adjustment pursuant to this Clause 10.3.
10.4 Subject to Clause 13.3, the Transferor shall be obliged to pay to the
credit of the Trustee Collection Account an amount equal to the amount of
each Reduction (as referred to in Clause 10.1), Early Collection (as
referred to in Clause 10.2) or Credit Adjustment (as referred to in Clause
10.3) by no later than the second Business Day following the date on which
it became aware of such Reduction, Early Collection or Credit Adjustment
(as the case may be) or was notified thereof by the Servicer.
11. BREACH OF WARRANTY AND INELIGIBLE RECEIVABLES
11.1 If, in respect of any Principal Receivable which has been assigned to the
Receivables Trustee, any representation referred to in Clause 16.2 or 16.3
proves at any time to have been incorrect when made, the Transferor shall
be treated as having received by way of a Collection the Outstanding Face
Amount of such Principal Receivable and, subject to Clause 13.3, the
Transferor shall be obliged to pay by no later than the Distribution Date
following the Monthly Period during which such representation becomes
known to the Transferor to be incorrect, an amount equal to the
Outstanding Face Amount of such Principal Receivable to the Trustee
Collection Account under advice to that effect to the Receivables Trustee,
PROVIDED HOWEVER that such Principal Receivable shall not be
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reassigned to the Transferor but shall thereafter be treated as an
Ineligible Receivable unless and until all Receivables outstanding on the
relevant Account are re-assigned to the Transferor in the circumstances
set out in Clause 11.3.
11.2 The fulfilment of the Transferor's obligation to make payments to the
Receivables Trustee required pursuant to Clause 11.1 in respect of a
Principal Receivable or (as the case may be) all the Principal Receivables
of an Obligor shall be in full satisfaction and discharge of any rights or
remedies which the Receivables Trustee may otherwise have had with respect
to such Principal Receivable as a result of any breach, anticipatory
breach or other circumstance on the part of or affecting the Transferor
arising under this Deed in relation to such Principal Receivable or (as
the case may be) the Obligor concerned, and accordingly, the Receivables
Trustee hereby acknowledges that it will have no further or other rights
with respect to such Principal Receivable as a result of or in connection
with any such breach, anticipatory breach or other circumstance.
11.3 In the event that:
11.3.1 each and every Principal Receivable which has been assigned to the
Receivables Trustee in respect of a Designated Account and which
remains outstanding proves to have been assigned to the
Receivables Trustee in circumstances where any representation
referred to in Clauses 16.2 and 16.3 was incorrect when made with
respect to such Principal Receivables and no Future Receivables
which are Principal Receivables could be generated on such
Designated Account without such Future Receivables breaching one
or more of the representations referred to in Clauses 16.2 and
16.3; and
11.3.2 the obligation of the Transferor with respect to such Principal
Receivables as set out in Clause 11.1 has been fulfilled
then the Transferor shall by five Business Days' written notice require
the Receivables Trustee (at the expense of the Transferor) to offer to
reassign all (but not some only) of the Receivables outstanding on such
Account to the Transferor on the date specified in such notice for a
nominal consideration not to exceed (pound)1 pursuant to an instrument to
be executed and maintained, if so requested by the Transferor, outside of
the United Kingdom. Following such reassignment such Receivables shall be
owned by the Transferor absolutely.
11.4 Where any Ineligible Receivable has been assigned to the Receivables
Trustee pursuant to an Offer which was accepted, and such Ineligible
Receivable was notified to the Receivables Trustee in accordance with
Clause 2.5.1 prior to such assignment and the Outstanding Face Amount of
such Receivable did not form part of the calculation of the Further
Payment payable with respect to such Offer, the Transferor shall by five
Business Days' written notice be entitled to require the Receivables
Trustee (at the expense of the Transferor) to offer to re-assign such
Receivable to the Transferor for a nominal consideration not to exceed
(pound)1 pursuant to an instrument to be executed and maintained, if so
requested by the Transferor, outside of the United Kingdom.
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12. CURRENCY OF ACCOUNT AND PAYMENT
12.1 Sterling is the currency of account and payment for each and every sum at
any time due from any person hereunder PROVIDED, HOWEVER, that:
12.1.1 each payment in respect of costs and expenses shall be made in the
currency in which the same were incurred; and
12.1.2 each payment (if any) which is expressed herein to be payable in
another currency shall be made in that other currency.
12.2 If any sum due from a person (a "RELEVANT PERSON") under this Deed or any
order or judgment given or made in relation hereto has to be converted
from the currency (the "FIRST CURRENCY") in which the same is payable
hereunder or under such order or judgment into another currency (the
"SECOND CURRENCY") for the purpose of (i) making or filing a claim or
proof against the relevant person, (ii) obtaining an order or judgment in
any court or other tribunal or (iii) enforcing any order or judgment given
or made in relation hereto, the relevant person shall indemnify and hold
harmless the person to whom such sum is due from and against any loss
suffered as a result of any discrepancy between (a) the rate of exchange
used for such purpose to convert the sum in question from the first
currency into the second currency and (b) the rate or rates of exchange at
which such person may in the ordinary course of business purchase the
first currency with the second currency upon receipt of a sum paid to it
in satisfaction, in whole or in part, of any such order, judgment, claim
or proof.
12.3 Except as specifically provided in this Deed or any other Transaction
Document all payments made by any person hereunder shall be made free and
clear of and without any deduction for or on account of any set-off or
counterclaim unless otherwise agreed in writing by the Transferor and the
Receivables Trustee.
13. PAYMENTS BY THE TRANSFEROR AND THE RECEIVABLES TRUSTEE
13.1 On each date upon which this Deed requires an amount to be paid in cash by
or on behalf of the Transferor to the Receivables Trustee, the Transferor
shall, save as expressly provided otherwise herein, make the same
available to the Receivables Trustee:
13.1.1 where such amount is denominated in Sterling by payment in
Sterling and in same day funds (or in such other funds as may for
the time being be customary in London for the settlement of
international banking transactions in Sterling) to such account
and bank as the Receivables Trustee shall have specified in
writing from time to time, or, if no such account has been
specified, as the Receivables Trustee shall specify in writing at
least two London Business Days prior to such amount becoming
payable; or
13.1.2 where such amount is denominated in a currency other than
Sterling, by payment in such currency and in immediately
available, freely transferable, cleared funds to such account with
such bank in the principal financial centre of the country of such
currency as the Receivables Trustee shall have specified in
writing for this purpose at least five London Business Days prior
to such amount becoming payable.
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13.2 On each date upon which this Deed requires an amount to be paid in cash to
the Transferor hereunder by or on behalf of the Receivables Trustee, the
Receivables Trustee shall, save as otherwise provided herein, make the
same available to the Transferor:
13.2.1 where such amount is denominated in Sterling, by payment in
Sterling and in same day funds (or in such other funds as may for
the time being be customary in London for the settlement of
international banking transactions in Sterling) to the Transferor
at such account and bank as the Transferor shall have specified in
writing from time to time, or, if no such account has been
specified, as the Transferor shall specify in writing at least two
Business Days prior to such amount becoming payable; or
13.2.2 where such amount is denominated in a currency other than
Sterling, by payment in such currency and in immediately
available, freely transferable, cleared funds to such account with
such bank in the principal financial centre of the country of such
currency as the Transferor shall have specified in writing for
this purpose at least five Business Days prior to such amount
becoming payable.
13.3 Notwithstanding any other provision of this Deed or the Receivables Trust
Deed and Servicing Agreement the Transferor and the Receivables Trustee
hereby agree and acknowledge that:
13.3.1 the amount payable by the Receivables Trustee to the Transferor in
cash pursuant to Clause 5.1 (in respect of payment of the Further
Payment for Existing Receivables) and Clause 5.3 (in respect of
the payment for Future Receivables and Acquired Interchange) on
any Business Day shall be set-off against the amount of any
shortfall in the amount of Cash Available for Investment on that
Business Day which is to be funded by the Transferor as a
beneficiary of the Receivables Trust in the circumstances
contemplated by Clause 5.2(c) of the Receivables Trust Deed and
Servicing Agreement, PROVIDED, HOWEVER, that the Transferor
Interest in the Receivables Trust is increased accordingly (and in
respect of any amount payable in respect of Ineligible
Receivables, the Transferor Ineligible Interest is increased
accordingly);
13.3.2 the obligation of the Transferor to the Receivables Trustee to pay
an amount in cash pursuant to Clause 10.4 (in respect of
reductions in Receivables) and Clause 11.1 (in respect of breach
of warranty) may be fulfilled (in whole or in part) by a reduction
in the amount of the Transferor Interest in the Receivables Trust
in the circumstances contemplated by Clause 5.3(a) or Clause
5.3(d)(i) of the Receivables Trust Deed and Servicing Agreement
PROVIDED, HOWEVER, that such decrease shall not cause the
Transferor Interest to be decreased to an amount which is less
than zero; and
13.3.3 the obligation of the Transferor to pay the (pound)1 payable to
the Receivables Trustee upon the exercise of the call option
pursuant to Clause 18 of the Receivables Trust Deed and Servicing
Agreement may be fulfilled by a reduction in the amount of the
Transferor Interest in the Receivables Trust, PROVIDED, HOWEVER,
19
that such decrease shall not cause the Transferor Interest to be
decreased to an amount which is less than zero.
13.4 For the avoidance of doubt, the Acceptance Price payable by the
Receivables Trustee pursuant to Clause 3.4 in order to accept an Offer
shall not be subject to the set-off arrangements described in Clause 13.3.
14. CARD OPERATING ACCOUNT, CARD PROCEEDS ACCOUNT AND ACCEPTANCE PRICE ACCOUNT
14.1 The Transferor has opened an account in its name for the purpose of
receiving, inter alia, Collections (the "Card Operating Account").
14.2 Pending application of monies from the Card Operating Account to the
Trustee Collection Account either hereunder or in accordance with the
Receivables Trust Deed and Servicing Agreement, the sums from time to time
standing to the credit of the Card Operating Account shall be held
respectively by the Transferor on trust for and to the order of (1) the
Receivables Trustee, to the extent such sums are Principal Collections,
Finance Charge Collections, Ineligible Collections on Designated Accounts
or Acquired Interchange and (2) otherwise, the Transferor; and the
Transferor hereby confirms that the bank at which the Card Operating
Account is maintained has been notified in writing that such account is a
trust account held on the above basis.
14.3 The Transferor has opened a bank account in its name for the purpose of
receiving inter ▇▇▇▇ ▇▇▇▇ payments due to the Transferor in respect of the
Purchase Price (other than cash payments in relation to the Acceptance
Price) of Receivables (such account, or such other account as the
Transferor may from time to time designate for such purpose, the "Card
Proceeds Account").
14.4 The Transferor has opened a bank account in its name for the purpose of
receiving any Acceptance Price paid to it by the Receivables Trustee
pursuant to Clause 6.1 (such account, or such other account as the
Transferor may from time to time designate for such purpose, the
"Acceptance Price Account").
15. THE TRUSTEE COLLECTION ACCOUNT
The Receivables Trustee hereby confirms that the Trustee Collection
Account has been opened in its name at a Qualified Institution.
16. REPRESENTATIONS
16.1 The Transferor represents as of the date hereof that each of the
statements set out in Parts 1 and 2 of Schedule 5 is true and the
Transferor shall be deemed to repeat such representations by reference to
the facts and circumstances then existing on each Addition Date and the
Closing Date specified in respect of any Supplement.
16.2 On each Addition Date the Transferor shall represent, as of the date
specified in the relevant Offer, that in relation to the relevant Offer
each of the statements set out in Part 3 of Schedule 5 is true with regard
to the Existing Receivables identified in such Offer which are Principal
Receivables (other than such Existing Receivables which have been notified
to the Receivables Trustee as being Ineligible Receivables).
20
16.3 On the Date of Processing in respect of each Future Receivable which is a
Principal Receivable, the Transferor shall be deemed to represent that
each of the statements set out in Part 3 of Schedule 5 is true with regard
to such Receivable unless such Principal Receivable is specified by the
Transferor as being an Ineligible Receivable pursuant to Clause 5.3.
17. COVENANTS
17.1 The Transferor shall:
17.1.1 pay to the Receivables Trustee by payment to the Trustee
Collection Account all payments received by the Transferor in
respect of Receivables on Designated Accounts as soon as
practicable after receipt thereof by the Transferor;
17.1.2 notify the Receivables Trustee of the existence of any Encumbrance
on any Receivable on a Designated Account and defend, at its own
expense, the right, title and interest of the Receivables Trustee
in, to and under the Receivables on Designated Accounts, whether
now existing or created, against all claims of third parties
claiming through or under the Transferor;
17.1.3 comply with and perform its obligations under the Lending
Agreements relating to the Designated Accounts and the Lending
Guidelines and all applicable rules and regulations of MasterCard
International Inc. and its subsidiaries, if any, VISA
International, Inc. and its subsidiaries, if any, and any other
relevant clearing system rules to which it may be subject, except
insofar as any failure to comply or perform would not cause a
Material Adverse Effect;
17.1.4 have in place and maintain a system which shall at all times be
capable of identifying the ownership (including beneficial
ownership) of all Receivables arising under any Accounts;
17.1.5 ensure that, where any proceedings have been initiated against the
Transferor under any applicable liquidation, insolvency,
composition, re-organisation (except a solvent re-organisation) or
similar laws for its winding-up, dissolution, administration, or
re-organisation, the relevant officer of the Transferor
responsible for dealing with such proceedings shall upon notice
thereof take all reasonable steps, acting in good faith, to cause
such proceedings to be promptly dismissed.
17.2 The Transferor shall not, except in accordance with the Transaction
Documents:
17.2.1 sell, assign, convey, transfer, lease, pledge or otherwise dispose
(or purport to do so) of any Designated Account or Receivable
(whether now existing or hereafter created) in a Designated
Account to any person other than the Receivables Trustee; or
17.2.2 grant, create, incur, assume or suffer to exist any Encumbrance
(or purport to do so) over any Receivable (whether now existing or
hereafter created) in a Designated Account or any interest
therein; or
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17.2.3 consolidate with or merge into any other Person or convey or
transfer its properties and assets substantially as an entirety to
any Person unless:
(a) if the Transferor is not the surviving entity, the entity
formed by such consolidation or into which the Transferor is
merged or the entity which acquires by conveyance or
transfer the properties and assets of the Transferor
substantially as an entirety, shall expressly assume, by an
agreement supplemental hereto, executed and delivered to the
Receivables Trustee in form satisfactory to the Receivables
Trustee, the performance of the obligations of the
Transferor hereunder (to the extent that any right, covenant
or obligation of the Transferor hereunder is inapplicable to
the successor entity, such successor entity shall be subject
to such covenant or obligation, or benefit from such right,
as would apply, mutatis mutandis, to such successor entity)
and the Transferor shall also execute such documents as are
necessary for such entity to become the Transferor
Beneficiary as contemplated in the Receivables Trust Deed
and Servicing Agreement;
(b) the Transferor (or the surviving entity if it is not the
Transferor) shall have delivered to the Receivables Trustee
a certificate of an authorised officer stating that such
consolidation, merger, conveyance or transfer and such
supplemental agreement comply with this Clause 17.2.3 and
that all documentation referred to in (a) above and any
conditions precedent specified in such documentation have
been complied with, and an Opinion of Counsel that such
supplemental agreement is legal, valid, binding and
enforceable except (a) as such enforceability may be limited
by applicable bankruptcy, insolvency, moratorium,
re-organisation or other similar laws affecting the
enforcement of the rights of creditors generally and (b) as
such enforceability may be limited by the effect of general
principles of equity; and
(c) the Transferor shall have delivered notice to each Rating
Agency of such consolidation, merger, conveyance or
transfer;
or
17.2.4 disclose the name or address of any Obligor to any Person seeking
to enforce a claim against the Transferor or otherwise in breach
of its obligations of confidentiality to any Obligor, except
pursuant to any Requirement of Law.
17.3 Subject to Clause 17.4, the Transferor may from time to time amend the
standard form terms and conditions of the Lending Agreements (other than
the terms and conditions which relate to the matters referred to in
paragraph (iii) of Schedule 1) or the Lending Guidelines in any respect
(including, without limitation, reducing or increasing the amount of any
required minimum monthly payment or amending the calculation of the amount
or the timing of charge-offs and the Periodic Finance Charges and other
fees assessed thereon), PROVIDED, HOWEVER, that such amendment may only be
made if such amendment is also applied to any comparable segment of
Accounts which are owned and serviced by the Transferor which have
characteristics equivalent or substantially similar
22
to, the Designated Accounts (except as otherwise restricted by an
endorsement, sponsorship or other agreement between the Transferor and an
unrelated third party or by the terms of the relevant Lending Agreements).
17.4 The Transferor hereby agrees that, except as otherwise required by any
Requirement of Law or as may be determined by the Transferor to be
necessary or in its best interests in order to maintain its credit card
business (such determination being based on a good-faith assessment by the
Transferor, in its sole discretion, of the nature of competition in the
credit card business in the United Kingdom as a whole, or, as the case may
be, in respect of Accounts relating to a Permitted Additional
Jurisdiction, of the nature of competition in the credit card business in
such Permitted Additional Jurisdiction as a whole), it shall not at any
time reduce the Periodic Finance Charges assessed on Receivables existing
or arising under any Designated Account or other fees on any Designated
Account if, as a result of such reduction, the Transferor's reasonable
expectation of the Portfolio Yield (as defined in each Supplement) would
be less than the Expense Rate (as defined in each Supplement) for any
Outstanding Issuance, in each case as of the immediately succeeding
Transfer Date.
18. CALL OPTION
18.1 The Receivables Trustee hereby grants to the Transferor the option set out
in Clause 18.2 below.
18.2 The Transferor may, by following the procedure set out in Clause 18.4
below, from time to time require the Receivables Trustee to assign to the
Transferor, for a consideration of (pound)1 (payable on each occasion when
the said option is exercised into the Trustee Collection Account), all
Defaulted Receivables existing at the option exercise time on Defaulted
Accounts, if and to the extent that the same shall not have been assigned
to the Transferor pursuant to any earlier exercise of such option (any
such Receivables being "ASSIGNED DEFAULTED RECEIVABLES").
18.3 Following the exercise of the option, the amount set out below will be
payable in respect of any Offer made in accordance with Clauses 2.1 to 2.3
(avoiding any double counting):
(a) any amount, for the avoidance of doubt excluding Insurance
Proceeds, received by the Transferor with respect to such Assigned
Defaulted Receivables; and
(b) any consideration payable by a third party for the assignment of
such Assigned Defaulted Receivables (net of any costs of the
Transferor in connection with such sale)
(each of (a) and (b) being the "SALE RECOVERIES") which, in accordance
with the obligation set out in Clauses 2.1 to 2.3, shall be paid into the
Trustee Collection Account on the Transfer Date relating to the Monthly
Period during which the Sale Recoveries were realised. For the avoidance
of doubt, Sale Recoveries shall only be paid into the Trustee Collection
Account to the extent that they have been received by the Transferor.
18.4 In order to exercise the option set out in Clause 18.2 above, the
Transferor shall:
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18.4.1 send a notice, substantially in the form of Schedule 3 to the
Receivables Trust Deed and Servicing Agreement, to the Receivables
Trustee (the "OPTION NOTICE") stating that on a specified date
(the "OPTION EXERCISE DATE") it shall require the Receivables
Trustee to assign the property described in Clause 18.2 above; and
18.4.2 send an assignment agreement for the Receivables Trustee to
execute, substantially in the form of Schedule 3 to the
Receivables Trust Deed and Servicing Agreement, (the "OPTION
ASSIGNMENT") stating the Outstanding Face Amount of the Defaulted
Receivables to be assigned to the Transferor on the related Option
Exercise Date.
18.5 Upon receipt of an Option Notice and an Option Assignment referred to in
Clause 18.4 above, the Receivables Trustee shall execute such Option
Assignment.
19. NON-PETITION
19.1 HSBC, in any capacity in which it acts under the Transaction Documents,
covenants with the Receivables Trustee that it shall not take any
corporate action or other steps or legal proceedings for the winding-up,
dissolution or re-organisation, or for the appointment of a receiver,
administrator, administrative receiver, trustee, liquidator, sequestrator
or similar officer, of the Receivables Trustee (either in its own capacity
or as trustee of the Receivables Trust or otherwise) or any Investor
Beneficiary, or of any or all of the revenues and assets of any of them.
19.2 The Transferor acknowledges that the obligations of the Receivables
Trustee under this Deed at any time are limited to the lesser, at such
time, of (a) the nominal amount thereof (the "NOMINAL AMOUNT") and (b) an
amount (the "AVAILABLE AMOUNT") equivalent to the value of the Transferor
Interest at such time. The Transferor shall not have a right to have
recourse to, or make demand or initiate proceedings against the
Receivables Trustee at any time whilst the nominal amount exceeds the
available amount. The Receivables Trustee shall incur no liability and be
under no additional duty to any person solely as a result of any inability
on its part to make payments or to perform other obligations under this
Deed, which inability results from the operation of the foregoing
provisions of this Clause 19.2.
19.3 The Transferor agrees that it shall have no recourse, in respect of any
obligation, covenant or agreement of the Receivables Trustee, against any
shareholder, officer, agent or director of the Receivables Trustee.
20. BENEFIT OF DEED
20.1 This Deed shall be binding upon and enure to the benefit of each party
hereto and its successors and permitted assigns.
20.2 Except in the circumstances contemplated by the provisions of Clause
17.2.3 the Transferor in its capacity as such shall not be entitled to
assign or transfer all or any of its rights, benefits and obligations
hereunder. The Receivables Trustee agrees that it shall, at the expense of
the Transferor, execute such documents as the Transferor may reasonably
require to effect the matters permitted pursuant to Clause 17.2.3.
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20.3 The Receivables Trustee shall not be entitled to assign or transfer all or
any of its rights, benefits and obligations hereunder except to the extent
permitted and in the manner provided by the Receivables Trust Deed and
Servicing Agreement.
21. DISCLOSURE OF INFORMATION
21.1 The Receivables Trustee hereby agrees that it shall not disclose any
Account Information to any person except in the following circumstances
and only to the extent permitted by applicable law:
21.1.1 if required in connection with the performance of its duties
hereunder or under the Receivables Trust Deed and Servicing
Agreement and any Supplement thereto;
21.1.2 if required in order to enforce the rights of any Beneficiary of
the Receivables Trust, or in connection with the appointment or
duties of a Successor Servicer appointed pursuant to Clause 11.3
of the Receivables Trust Deed and Servicing Agreement;
21.1.3 with the consent of the Transferor, in connection with any
security interest any Investor Beneficiary has created or is
proposing to create over its beneficial interest in the
Receivables Trust in connection with an issue of Related Debt or
Associated Debt; or
21.1.4 pursuant to any Requirement of Law.
21.2 The Receivables Trustee agrees to take such measures as shall be
reasonably requested by the Transferor to protect and maintain the
security and confidentiality of Account Information and, in connection
therewith, shall allow the Transferor (at the Transferor's expense) to
inspect the Receivables Trustee's security and confidentiality
arrangements from time to time during normal business hours and upon
reasonable notice being given.
21.3 If the Receivables Trustee is required by any Requirement of Law to
disclose any Account Information, the Receivables Trustee shall provide
the Transferor with prompt written notice, unless such notice is
prohibited by law, of any such request or requirement. The Receivables
Trustee shall make reasonable efforts to provide the Transferor with
written notice no later than five Business Days prior to any such
disclosure unless compliance with this requirement would or might breach
any law.
22. REMEDIES AND WAIVERS
22.1 No failure to exercise, nor any delay in exercising, on the part of any
party hereto, any right or remedy hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any right or remedy
prevent any further or other exercise thereof or the exercise of any other
right or remedy.
22.2 The rights and remedies herein provided are cumulative and not exclusive
of any rights or remedies provided by law.
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23. PARTIAL INVALIDITY
23.1 Without prejudice to any other provision hereof, if one or more provisions
hereof is or becomes invalid, illegal or unenforceable in any respect in
any jurisdiction or with respect to any party such invalidity, illegality
or unenforceability in such jurisdiction or with respect to such party or
parties shall not, to the fullest extent permitted by applicable law,
render invalid, illegal or unenforceable such provision or provisions in
any other jurisdiction or with respect to any other party or parties
hereto.
24. COUNTERPARTS
24.1 This Deed may be executed in any number of counterparts and by different
parties hereto in separate counterparts, each of which when so executed
shall be deemed to be an original and all of which when taken together
shall constitute one and the same Agreement.
25. NOTICES
25.1 Unless otherwise stated herein, each communication or notice to be made
hereunder shall be made in writing and may be made by fax or letter.
25.2 Any communication, notice or document to be made or delivered by any one
person to another pursuant to this Deed shall (unless that other person
has by fifteen days' written notice to the other parties hereto specified
another address) be made or delivered to that other person at the address
identified below and shall be deemed to have been made or delivered when
despatched and confirmation of transmission received by the sending
machine (in the case of any communication made by fax) or (in the case of
any communication made by letter) when left at that address or (as the
case may be) ten days after being deposited in the post postage prepaid in
an envelope addressed to it at that address PROVIDED, HOWEVER, that each
fax communication made by one party hereto to another shall be made to
that other person at the fax number notified to such party by that other
person from time to time:
25.2.1 in the case of the Transferor to HSBC Bank plc, ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇ ▇▇▇, fax number: ▇▇▇ ▇▇▇▇ ▇▇▇▇ attention: HSBC Cards
Services; and
25.2.2 in the case of the Receivables Trustee to ▇▇ ▇▇▇ ▇▇, ▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇ ▇▇▇, fax number: ▇▇▇ (▇) ▇▇▇▇ ▇▇▇
729, attention: the Directors.
26. TERMINATION OF RECEIVABLES TRUST DEED AND SERVICING AGREEMENT
26.1 Notwithstanding any other provision of this Deed, the parties hereto
acknowledge that if following the occurrence of any Insolvency Event the
Receivables Trust is dissolved in accordance with the provisions of Clause
6.3 of the Receivables Trust Deed and Servicing Agreement, then the
provisions of this Deed shall also terminate without further action by the
parties hereto, PROVIDED, HOWEVER, that such termination shall be without
prejudice to any rights existing on or prior to the date of such
Insolvency Event (including rights relating to the giving of notice to
Obligors as set out in Clause 6 hereof).
26
27. LAW
27.1 This Deed shall be governed by, and construed in accordance with, English
law.
28. JURISDICTION
28.1 Each of the parties hereto irrevocably agrees for the benefit of each
other party that the courts of England shall have non-exclusive
jurisdiction to hear and determine any suit, action or proceeding, and to
settle any disputes, which may arise out of or in connection with this
Deed and, for such purposes, irrevocably submits to the exclusive
jurisdiction of such courts. Each of the parties hereto also agrees for
the benefit of each other party that any proceedings against any party to
this Deed arising out of or based upon this Deed may be instituted in a
court of Jersey, Channel Islands.
28.2 Each party hereto irrevocably waives any objection which it might now or
hereafter have to the courts referred to in Clause 28.1 being nominated as
the forum to hear and determine any suit, action or proceeding, and to
settle any disputes, which may arise out of or in connection with this
Deed and agrees not to claim that any such court is not a convenient or
appropriate forum.
28.3 The Receivables Trustee irrevocably appoints the person specified against
its name below to accept service of any process on its behalf and further
undertakes to the other parties hereto that it will at all times during
the continuance of this Deed maintain the appointment of some person in
England as its agent for the service of process and irrevocably agrees
that service of any writ, notice or other document for the purposes of any
suit, action or proceeding in the courts of England shall be duly served
upon it if delivered or sent by registered post to the address of such
appointee (or to such other address in England as that party may notify to
the other parties hereto).
29. RIGHTS OF THIRD PARTIES
Without prejudice to the rights of any shareholder, officer, agent or
director as referred to at clause 19.3 to enforce clause 19.3, a person
who is not a party to this Deed has no right under the Contracts (Rights
of Third Parties) ▇▇▇ ▇▇▇▇ to enforce any terms of this Deed, but this
does not affect any right or remedy of a third party which exists or is
available apart from that Act.
IN WITNESS WHEREOF the parties hereto have caused this Deed to be executed and
delivered by their duly authorised representatives as a deed on the day and year
first before written.
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SCHEDULE 1
ELIGIBLE ACCOUNTS
An Account will be an "Eligible Account" if it is an Account:
(i) where the Obligor is an individual, natural person, and is not a
company or partnership for the purposes of Section 349(2) of the
Income and Corporation Taxes ▇▇▇ ▇▇▇▇;
(ii) which was in existence and maintained with the Transferor prior to
its designation as a Designated Account;
(iii) which is payable in pounds sterling or the lawful currency of a
Permitted Additional Jurisdiction (where the Account is in a
Permitted Additional Jurisdiction);
(iv) which is governed by one of the Transferor's standard form credit
card agreements or if it was acquired by the Transferor was
originated on contractual terms not materially different from that
standard form;
(v) which is governed by a Lending Agreement without waiver or
amendment in any material respect of the following matters:
governing law, assignment and disclosure of information to persons
who may assume rights under the Lending Agreement, or else, if
acquired by the Transferor, is governed by contractual terms not
materially different from such Lending Agreement in relation to
those matters listed previously;
(vi) which is governed in whole or in part by the Consumer Credit ▇▇▇
▇▇▇▇, and creates legal, valid and binding obligations between the
Transferor and the relevant Obligor and is enforceable against the
relevant Obligor in accordance with the Consumer Credit ▇▇▇ ▇▇▇▇,
subject to applicable bankruptcy laws, other similar laws
affecting creditor's rights, general equitable principles and
limitations on enforcement in the jurisdiction of the relevant
Obligor and which was otherwise created and complies with all
other applicable laws;
(vii) the Obligor of which has provided as its most recent billing
address an address which is located in either England, Wales,
Scotland, Northern Ireland or a Permitted Additional Jurisdiction
or a Restricted Additional Jurisdiction, Provided however that the
aggregate balance of Receivables in any Designated Accounts which
would have fallen outside the foregoing criteria but for this
proviso (including any Existing Receivables comprised in the same
Offer as the Receivables in the Account in respect of which this
representation is being made), would equal an amount which
represents less than 10 per cent. of the total aggregate balance
of Receivables in the Securitised Portfolio;
(viii) any card in respect of which the Transferor has not classified on
its electronic records as counterfeit, cancelled, fraudulent,
stolen or lost;
(ix) which has been originated or purchased by the Transferor;
28
(x) which has been operated, in all material respects, in accordance
with the Transferor's policies and procedures and usual practices
for the operation of its credit card business;
(xi) which has not been, and does not have any Receivables which have
been, sold, pledged, assigned or otherwise conveyed to any person
(except to the Receivables Trustee following its acceptance of an
Offer);
(xii) the receivables in respect of which have not been charge-off by
the Transferor on the date the Account is specified as a
Designated Account;
(xiii) subject as provided below, which is not a Defaulted Account; and
(xiv) which relates to an Obligor who is not identified by the
Transferor in its computer files as being the subject of a
voluntary or involuntary bankruptcy or equivalent proceeding.
PROVIDED, HOWEVER, that notwithstanding (i) to (xiv) above an Account will be an
Eligible Account if the Transferor and the Receivables Trustee have received
confirmation from each Rating Agency that the inclusion of such Account (or each
Account with such characteristics) will not result in a withdrawal or reduction
of the then current rating of any outstanding debt secured directly or
indirectly on the property of the Receivables Trust.
Eligible Accounts may include Accounts, the Receivables of which have been
written off, provided that:
(c) the balance of all Receivables included in such Accounts is
reflected on the books and records of the Transferor as "zero"
(and is treated as such, whether or not such Account has been
designated a Zero Balance Account); and
(d) charging privileges with respect to all such Accounts have been
cancelled in accordance with the Lending Guidelines and will not
be reinstated by the Transferor or the Servicer.
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SCHEDULE 2
ELIGIBLE RECEIVABLES
A Receivable will be an "Eligible Receivable" if:
(i) it has arisen under an Eligible Account;
(ii) it was originated under the Transferor's standard form credit card
agreements and is governed, in whole or in part, by the Consumer
Credit ▇▇▇ ▇▇▇▇, or else , if the related Account was acquired by
the Transferor, under contractual terms that are materially the
same as the standard form credit card agreements and are governed
in whole or in part by the Consumer Credit ▇▇▇ ▇▇▇▇;
(iii) it has been otherwise created in compliance with all other
applicable laws and all consents, licenses, approvals,
authorisations, registrations or declarations required to be
obtained, effected or given by the Transferor or the Servicer in
connection with the creation and assignment of Receivables have
been obtained, effected or given, and are in full force and effect
as of the date of creation;
(iv) it was originated in accordance with the Transferor's policies and
procedures and usual practices for its credit card business (or in
respect of a Receivable which has arisen on an Account acquired by
the Transferor prior to the date of acquisition by the Receivables
Trustee, it was, to the best of the Transferor's knowledge and
belief, originated in accordance with the lending guidelines of
the originator of such Account);
(v) it is not a defaulted receivable as at the Offer Date or Addition
Date, as applicable;
(vi) it is free and clear of any Encumbrances exercisable against the
Transferor or the Receivables Trustee arising under or through the
Transferor (or any of its Affiliates) and to which, at the time of
creation of such Receivable (or at the time of acquisition of such
Receivable by the Transferor if such Receivable was originated by
any person other than the Transferor) and at all times thereafter,
the Transferor or the Receivables Trustee had good and marketable
title;
(vii) it constitutes legal, valid and binding obligations of the
relevant Obligor enforceable against such Obligor in accordance
with the terms of the relevant credit card agreement under which
it was originated subject only to (a) applicable bankruptcy,
insolvency, reorganisation, moratorium or other similar laws
affecting the enforcement of the rights of creditors generally and
(b) the effect of general principles of equity and limitation on
enforcement in the relevant cardholder's jurisdiction of
residence;
(viii) it is not currently subject to any defence, dispute, event,
set-off counterclaim or enforcement order; and
(ix) at the time of transfer to the Receivables Trustee, it has not
been waived or modified except as permitted in accordance with the
terms of this Deed.
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SCHEDULE 3
FORM OF OFFER
To: The Receivables Trustee
From: HSBC BANK PLC
Dated: [o]
SUBJECT TO CONTRACT
(UNLESS AND UNTIL ACCEPTED)
OFFER
1. We refer to the Receivables Securitisation Deed (as from time to time
amended, supplemented or novated, the "RECEIVABLES SECURITISATION DEED")
dated on or about [o] and made between ourselves and yourselves.
2. Terms defined in (or incorporated by reference into) the Receivables
Securitisation Deed shall bear the same meaning herein.
3. We have identified on our system (and identified therein) certain Accounts
which, should you decide to accept this Offer by payment of the Acceptance
Price, are to become Designated Accounts (subject to any revocation
pursuant to paragraph 8, the "NEW DESIGNATED ACCOUNTS"). If you accept
this Offer the New Designated Accounts will be identified with the
designation "[o]" in the Designated Account File maintained by the
Servicer. We hereby offer you an assignment of:
(i) the Existing Receivables under each such New Designated Account as
of the opening of business on the Proposed Addition Date (defined
below) in respect of this Offer;
(ii) all Future Receivables under each such New Designated Account
which are not Finance Charge Receivables in respect of Principal
Receivables and which arise before the earliest of:
(a) in respect of each New Designated Account, such time (if
any) as such Account becomes a Redesignated Account;
(b) the termination of the Receivables Trust; or
(c) the occurrence of an Insolvency Event;
(iii) all Future Receivables arising on each New Designated Account
which are Finance Charge Receivables in respect of Receivables
which are offered to the Receivables Trustee pursuant to
paragraphs (i) and (ii) above;
(iv) (to the extent such are capable of assignment) the benefit of, and
any proceeds arising from, each guarantee or insurance policy
obtained by ourselves in respect of the obligations of an Obligor
to make payments on such New Designated Accounts, including all
Insurance Proceeds; and
31
(v) [in respect of the Offer pursuant to Clause 2.1 of the Receivables
Securitisation Deed only] Acquired Interchange in respect of each
Monthly Period.
4. The Acceptance Price payable in order to accept this Offer is
[(pound)10,000]. The Offer may be accepted on the date hereof (being the
"PROPOSED ADDITION DATE") at any time falling at least one hour after it
has received notification of the Outstanding Face Amount of the Existing
Receivables pursuant to Clause 9.5(a)(ix) of the Receivables Trust Deed
and Servicing Agreement. If this Offer is not accepted on the Proposed
Addition Date, it shall lapse at the close of business on such date and
shall not be capable of acceptance thereafter.
5. Save in respect of those Existing Receivables which we have identified as
an Ineligible Receivables, we will warrant to you in respect of each
Existing Receivable which is a Principal Receivable which is offered to
you hereby, that each of the representations referred to in Clause 16.2 of
the Receivables Securitisation Deed is true on and as of the following
date: [specify relevant date].
6. We acknowledge that if you accept the Offer contained herein we will be
deemed to represent in respect of each Future Receivable which is a
Principal Receivable arising on the New Designated Accounts on the Date of
Processing relating thereto that each of the representations referred to
in Clause 16.3 of the Receivables Securitisation Deed is true on and as of
such Date of Processing save in respect of a Principal Receivable which we
have identified as an Ineligible Receivable.
7. In respect of the New Designated Accounts we certify and represent that:
(i) no selection procedures adverse to the Investor Beneficiaries of
any Outstanding Issuance have been employed by us in selecting the
New Designated Accounts from amongst the Eligible Accounts in our
portfolio of Accounts; and
(ii) [in respect of Offers pursuant to Clause 2.2 of the Receivables
Securitisation Deed only, and where there is outstanding
Associated Debt which is rated by a Rating Agency] [the Offer
satisfies the Maximum Addition Amount criteria] or [the Offer does
not satisfy the Maximum Addition Amount criteria but we have
received written confirmation from each Rating Agency that the
inclusion of such New Designated Accounts as Designated Accounts
pursuant to Clause 2.2 of the Receivables Securitisation Deed will
not result in a withdrawal or downgrading of the current rating of
any Associated Debt].
8. This Offer shall be revocable, in whole or in respect of certain nominated
Accounts only, from the date of this Offer until such time as this Offer
is accepted by you (if at all). We will inform you in writing if we intend
to revoke this Offer either in whole or in respect of certain nominated
Accounts only.
Yours faithfully
32
for and on behalf of
HSBC BANK PLC
33
SCHEDULE 4
CONDITIONS PRECEDENT TO SUBSEQUENT OFFERS
The Transferor shall provide the following documents to the Receivables Trustee
(which shall be in form and substance satisfactory to the Receivables Trustee):
1. A Solvency Certificate from the Transferor substantially in the form set
out in the Schedule 7.
2. A statement from the Transferor in the relevant Offer substantially in the
form set out in paragraph 7 of the form of Offer in Schedule 3 confirming
either:
(i) the Offer satisfies the Maximum Addition Amount criteria; or
(ii) if the Offer does not satisfy the Maximum Addition Amount criteria
but the Transferor has received written notice from each Rating
Agency that the inclusion of such Accounts as Designated Accounts
pursuant to Clause 2.2 will not result in the reduction or
withdrawal of its then current rating of any outstanding Related
Debt or Associated Debt,
PROVIDED THAT this paragraph 2 shall not be a condition precedent to any
Offer if on the related Offer Date there is no outstanding Associated Debt
for which a rating has been provided by a Rating Agency.
3. If applicable, a legal opinion addressed to the Receivables Trustee in
respect of Receivables arising in any new Permitted Additional
Jurisdiction from reputable legal advisers qualified to practise in such
new Permitted Additional Jurisdiction.
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SCHEDULE 5
REPRESENTATIONS
PART 1 - REPRESENTATIONS AS TO MATTERS OF LAW
1. ORGANISATION: It is a limited liability company duly incorporated under
the laws of England, with full corporate power, authority and legal right
to own its assets and conduct its business as such assets are presently
owned and its business is presently conducted and with power to enter into
this Deed and the other Transaction Documents to which it is party and
each assignment in respect of any Receivables assigned pursuant to any
acceptance of an Offer (in this Schedule 5, each a "RECEIVABLES
ASSIGNMENT") and to exercise its rights and perform its obligations
thereunder, and all corporate and other action required to authorise its
execution and delivery of each Transaction Document to which it is party
and each Receivables Assignment and its performance of its obligations
thereunder has been duly taken or will be taken prior to the execution of
such Transaction Document or Receivables Assignment (as the case may be).
2. DUE AUTHORISATION: All acts, conditions and things required to be done,
fulfilled and performed in order (a) to enable it lawfully to enter into,
exercise its rights under and perform and comply with the obligations
expressed to be assumed by it in each Transaction Document to which it is
party or in any Receivables Assignment, (b) to ensure that the obligations
expressed to be assumed by it in each Transaction Document to which it is
party or in any Receivables Assignment are legal, valid and binding on it
and (c) to make each Transaction Document to which it is party and each
Receivables Assignment admissible in evidence in England have been done,
fulfilled and performed or will be done, fulfilled or performed prior to
the execution of such Transaction Document or Receivables Assignment (as
the case may be) save for the payment of stamp duty in respect of any
assignment of Receivables or any agreement to assign Receivables (or any
memorandum of such an assignment or agreement) under any Requirement of
Law (where payable).
3. NO VIOLATION: The execution of each Transaction Document to which it is
party by it and its entry into any Receivables Assignment, and the
exercise of its rights and the performance of its obligations under any
such document or assignment will not conflict with or violate any
Requirement of Law.
4. DOCUMENTARY REQUIREMENTS: Under the laws of England in force as at the
date of making this representation, it is not necessary that any
Transaction Document or any Receivables Assignment be filed, recorded or
enrolled with any court or other authority in England or that any stamp,
registration or similar tax be paid on or in relation to any Transaction
Document or any Receivables Assignment, save for the payment of stamp duty
on any Receivables Assignment under any Requirement of Law (where
payable).
5. BINDING OBLIGATIONS: The obligations expressed to be assumed by it in each
Transaction Document to which it is party and each Receivables Assignment
are legal and valid obligations binding on it and enforceable against it
in accordance with its terms (or will be so upon execution of each such
Transaction Document or completion of such Receivables Assignment), except
(a) as such enforceability may be limited by applicable
35
bankruptcy, insolvency, moratorium, re-organisation or other similar laws
affecting the enforcement of the rights of creditors generally or by
regulatory duties and obligations under the Banking ▇▇▇ ▇▇▇▇ or any
successor or replacement legislation and (b) as such enforceability may be
limited by the effect of general principles of equity.
6. ALL CONSENTS REQUIRED: All approvals, authorisations, consents, orders or
other actions of any person or of any governmental or regulatory body or
official required in connection with the execution and delivery of each
Transaction Document to which it is party, the performance of the
transactions contemplated by each Transaction Document to which it is
party and/or its completion of any Receivables Assignment have been
obtained, other than those that would not materially and adversely affect
the validity or enforceability of the Transaction Documents or relevant
Receivables Assignment.
36
PART 2 - REPRESENTATIONS AS TO MATTERS OF FACT
7. NO PROCEEDINGS: There are no proceedings or investigations commenced or,
to the best of its knowledge, pending or threatened against the Transferor
before any Court, regulatory body, arbitral tribunal or public or
administrative body or agency (i) asserting the invalidity of any
Transaction Document or of any Receivables Assignment made in the manner
therein contemplated; (ii) seeking to prevent the entering into of any
such Receivables Assignment or of any of the transactions contemplated by
any Transaction Document; (iii) seeking any determination or ruling that,
in the Transferor's reasonable opinion, would materially and adversely
affect the performance by it of its obligations under any Transaction
Document; or (iv) seeking any determination or ruling that would
materially and adversely affect the validity or enforceability of any
Transaction Document or any Receivables Assignment to be made in the
manner therein contemplated.
8. NO CONFLICT: The execution of any Transaction Document or completion of
any Receivables Assignment in the manner therein contemplated and the
exercise by the Transferor of its rights and the performance of its
obligations thereunder with regard to such Receivables will not conflict
with, result in any breach of the material terms and provisions of, or
constitute a material default under, any agreement, indenture, contract,
mortgage, deed of charge or other instrument to which it is a party or by
which it or any of its assets is otherwise bound.
9. DUE QUALIFICATION: All licences, approvals, authorisations and consents
which may be reasonably considered to be necessary in connection with the
performance of its credit card business and in particular any applicable
authorisations under the Consumer Credit ▇▇▇ ▇▇▇▇ and the Data Protection
Act 1998 have been obtained and remain in force in all material respects.
10. INSOLVENCY: None of the events described in paragraphs 1 to 4 of Schedule
6 has occurred and is continuing with respect to the Transferor.
11. ACCOUNTS NOT DELINQUENT: In relation to any Account which becomes a
Designated Account on an Addition Date on which this representation is
made, no Receivables on such Account have remained outstanding for more
than 180 days after the initial due date for payment thereof.
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PART 3 - REPRESENTATIONS RELATING TO RECEIVABLES
1. ELIGIBILITY: Unless identified as an Ineligible Receivable, each Existing
Receivable is an Eligible Receivable and has arisen under an Eligible
Account and, unless specified in any Servicer Daily Report provided to the
Receivables Trustee by the Servicer pursuant to Clause 9.6(a) of the
Receivables Trust Deed and Servicing Agreement, each Future Receivable
which is a Principal Receivable is on the relevant Date of Processing an
Eligible Receivable and has arisen from an Eligible Account in the amount
specified in such Servicer Daily Report.
2. ASSIGNMENT EFFECTIVE: The assignment of each Receivable the subject of an
Offer will be effective to pass to the Receivables Trustee good and
marketable title thereto and the benefit thereof (including in such
context, any Collections and other rights in connection therewith such as
related guarantees and Insurance Proceeds) free of any Encumbrances in
favour of any person claiming through or under the Transferor or any of
its Affiliates to the Receivables Trustee and, subject to any limitations
arising on enforcement in the jurisdiction of the relevant Obligor, no
further act, condition or thing will be required to be done in connection
therewith to enable the Receivables Trustee to require payment of any such
Receivable or to enforce any such right in the courts of England and
Wales, Scotland or Northern Ireland or any Permitted Additional
Jurisdiction without the participation of the Transferor other than:
(1) the giving of a Notice of Assignment and completion of a written
transfer in respect of such Receivables and the payment of any
applicable United Kingdom stamp duty; or
(2) the joinder of the Transferor as a party to proceedings by the
Receivables Trustee against the relevant Obligor.
3. COMPLIANCE: The assignment of each Receivable the subject of an Offer is
in compliance with Requirements of Law applicable to the Transferor on the
date of such assignment.
4. SELECTION: No selection procedures adverse to the Investor Beneficiaries,
whether direct or indirect, have been employed by the Transferor in
selecting the Eligible Accounts from amongst the accounts originated or
acquired by the Transferor.
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SCHEDULE 6
NOTIFICATION EVENTS
1. A duly authorised officer of the Transferor shall admit in writing that
the Transferor is unable to pay its debts as they fall due within the
meaning of Section 123(1) of the Insolvency ▇▇▇ ▇▇▇▇ or the Transferor
makes a general assignment for the benefit of or a composition with its
creditors or voluntarily suspends payment of its obligations with a view
to the general readjustment or rescheduling of its indebtedness.
2. Either:
(a) the Transferor shall consent to or take any corporate action
relating to the appointment of a receiver, administrator,
administrative receiver, trustee, liquidator or similar officer of
it or relating to all or substantially all of its revenues and
assets; or
(b) proceedings shall be initiated against the Transferor under any
applicable liquidation, insolvency, composition, re-organisation
or similar laws for its winding-up, dissolution, administration or
reorganisation (except for a solvent reorganisation) and such
proceedings are not discharged within 60 days; or
(c) a receiver, administrator, administrative receiver, liquidator,
trustee or similar officer of the Transferor or relating to all or
substantially all of its revenues and assets is legally and
validly appointed and such appointment is not discharged within 14
days.
3. Any execution or distress is levied against, or an encumbrancer takes
possession of, the whole or any material part of the property, undertaking
or assets of the Transferor or any event occurs which under the laws of
any jurisdiction has a similar or analogous effect.
4. The Transferor (or the Servicer on behalf of the Transferor) fails to pay
any sum due from it to the Receivables Trustee hereunder in respect of the
Designated Accounts within 5 Business Days of the due date thereof or the
date of demand, if payable on demand, in the currency and in the manner
specified herein, and such failure is not remedied within 10 Business Days
after the Receivables Trustee has given notice thereof to the Transferor.
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SCHEDULE 7
FORM OF SOLVENCY CERTIFICATE
[on letterhead of the Transferor]
("the Company")
To: The Receivables Trustee
[Address]
dated [o]
IN RELATION TO THE OFFER FOR THE SALE OF
CREDIT CARD RECEIVABLES BY
HSBC BANK PLC
IT IS HEREBY CERTIFIED that, having duly considered the provisions of Sections
123 (as to when a company is deemed to be unable to pay its debts) and 238 to
241 (as to transactions at an undervalue and preferences) of the Insolvency Act
1986 (the "Act") the Company has determined that:
(1) as at the date hereof, the Company is able to pay its debts within the
meaning of Section 123 of the Act and would not become unable to do so as
a consequence of the sale by way of assignment of credit card receivables
pursuant to the Offer of even date herewith] (the "Offer") [and effect of
the proposed Discount Percentage nomination] made pursuant to the terms of
Clause [2.1/2.2] of the receivables securitisation agreement (the "RSD")
dated [o] and entered into between the Company and the Receivables
Trustee;
(2) no order has been made or resolution passed for the winding-up or
administration of the Company and, to the best of my knowledge and belief:
(a) no petition had been presented for the winding-up or administration
of the Company; and
(b) no receiver, administrative receiver, or receiver and manager has
been appointed in relation to all or any material part of the
Company's property, assets or undertaking
(disregarding proceedings which are not being pursued or are discharged or
are being contested in good faith on proper grounds where less than 60
days have expired since their commencement);
(3) the value in money or money's worth of the consideration which would be
receivable by the Company in accordance with the RSD following any
acceptance of the Offer would not be significantly less than the value, in
money or money's worth, of the consideration provided by the Company under
the RSD;
40
(4) any assignment of the Receivables to the Receivables Trustee which would
occur upon acceptance of the Offer and all matters concerning the Company
in connection with such matters would, to the extent to which these were
to be carried out by the Company, be effected by the Company in good faith
and for the purpose of carrying on its business, and there are reasonable
grounds for believing that the assignment of the Receivables and all
related matters would benefit the Company;
(5) in submitting the Offer to the Receivables Trustee the Company has not
been influenced by a desire to prefer one of the Company's creditors
and/or prejudice the general body of creditors of the Company; [and]
(6) [in respect of a Discount Percentage only] in the reasonable opinion of
the Company the performance of the portfolio of Designated Accounts is
such that the yield of Finance Charge Collections is not generating
adequate cashflows for the Beneficiaries of the Receivables Trust and the
size of the Discount Percentage is not intended by the Company solely to
accelerate distributions of Deferred Consideration to the Transferor].
Words and expressions defined in the RSD shall, unless the context otherwise
requires, bear the same meanings when used herein.
DATED
----------------------------------
Signed for and on behalf of
HSBC BANK PLC
41
SCHEDULE 8
FORM OF NOTICE OF ASSIGNMENT
From: HSBC BANK PLC
To: [Obligor]
Account ref: [o]
Notice of Assignment
We are writing to notify you that on [o] HSBC Bank plc transferred its rights to
receive all amounts payable by you in respect of your [description of product]
account to Turquoise Receivables Trustee Limited to be held on trust for, among
others, HSBC Bank plc. This transfer related only to amounts payable for charges
incurred on your account. The account itself continued to be legally held with
HSBC Bank plc and the terms and conditions on which the account is held did not
change as a consequence of the transfer.
Following your receipt of this notice all payments which you are required to
make for charges on your account will now be made directly to Turquoise
Receivables Trustee Limited as the party entitled to receive those payments.
However, please note that this notice is for your information only and you do
not need to do anything further in relation to your account.
HSBC BANK PLC
*[Note: This notice could attract stamp duty if signed manually, so should
rather be stamped.]
IN WITNESS WHEREOF, the parties hereto have caused this Deed to be executed and
delivered by their duly authorised representatives on the day and year first
before written.
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EXECUTION
TRANSFEROR AND OFFEROR
EXECUTED AS A DEED )
By ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ) ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
acting as attorney )
for and on behalf of )
HSBC BANK PLC )
in the presence of: )
Signature of witness: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
---------------------------------
Name of witness: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
---------------------------------
Address: 8 CANADA SQ, LONDON
---------------------------------
Occupation: LEGAL ADVISER
---------------------------------
RECEIVABLES TRUSTEE
EXECUTED as a Deed by )
TURQUOISE RECEIVABLES )
TRUSTEE LIMITED )
Pursuant to a resolution of the board ) S.M. HOLLYWOOD
DIRECTOR
43
