Exhibit 99.1
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AMENDED AND RESTATED
POOLING AND SERVICING AGREEMENT
Among
CARD ACQUISITION FUNDING LLC
as Transferor,
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
as Servicer
and
BANKERS TRUST COMPANY,
as Trustee
POOLING AND SERVICING AGREEMENT
Dated as of June 1, 1993
and
AMENDED AND RESTATED
as of February 5, 2002
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TABLE OF CONTENTS
Page
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ARTICLE I
Definitions
SECTION 1.01. Definitions..................................................1
SECTION 1.02. Other Definitional Provisions...............................19
ARTICLE II
Conveyance of Receivables
SECTION 2.01. Conveyance of Receivables...................................20
SECTION 2.02. Acceptance by Trustee; Permitted Trust Activities...........22
SECTION 2.03. Representations and Warranties of the Transferors
Relating to the Transferors...............................23
SECTION 2.04. Representations and Warranties of the Transferors
Relating to the Agreement and Any Supplement
and the Receivables.......................................25
SECTION 2.05. Reassignment of Ineligible Receivables......................28
SECTION 2.06. Reassignment of Receivables in Trust Portfolio..............29
SECTION 2.07. Covenants of the Transferors................................30
SECTION 2.08. Addition of Accounts........................................32
SECTION 2.09. Removal of Accounts.........................................36
SECTION 2.10. Account Allocations.........................................38
ARTICLE III
Administration and Servicing of Receivables
SECTION 3.01. Acceptance of Appointment and Other Matters Relating
to the Servicer...........................................38
SECTION 3.02. Servicing Compensation......................................40
SECTION 3.03. Representations, Warranties and Covenants of the
Servicer..................................................40
SECTION 3.04. Reports and Records for the Trustee.........................43
SECTION 3.05. Annual Certificate of Servicer..............................43
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SECTION 3.06. Annual Servicing Report of Independent Public
Accountants, Copies of Reports Available..................43
SECTION 3.07. Tax Treatment...............................................45
SECTION 3.08. Notices to the Bank.........................................45
SECTION 3.09. Adjustments.................................................45
SECTION 3.10. Reports to the Commission...................................46
ARTICLE IV
Rights of Certificateholders and
Allocation and Application of Collections
SECTION 4.01. Rights of Certificateholders................................46
SECTION 4.02. Establishment of Collection Account and Special
Funding Account...........................................47
SECTION 4.03. Collections and Allocations.................................49
SECTION 4.04. Shared Principal Collections................................52
SECTION 4.05. Additional Finance Charges..................................52
ARTICLE V
Distributions and Reports to Certificateholders
ARTICLE VI
The Certificates
SECTION 6.01. The Certificates............................................53
SECTION 6.02. Authentication of Certificates..............................53
SECTION 6.03. New Issuances...............................................54
SECTION 6.04. Registration of Transfer and Exchange of Certificates.......55
SECTION 6.05. Mutilated, Destroyed, Lost or Stolen Certificates...........58
SECTION 6.06. Persons Deemed Owners.......................................58
SECTION 6.07. Appointment of Paying Agent.................................59
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SECTION 6.08. Access to List of Registered Certificateholders'
Names and Addresses.......................................59
SECTION 6.09. Authenticating Agent........................................60
SECTION 6.10. Book-Entry Certificates.....................................61
SECTION 6.11. Notices to Clearing Agency..................................61
SECTION 6.12. Definitive Certificates.....................................62
SECTION 6.13. Global Certificate; Exchange Date...........................62
SECTION 6.14. Meetings of Certificateholders..............................63
ARTICLE VII
Other Matters Relating to the Transferors
SECTION 7.01. Liability of the Transferors................................65
SECTION 7.02. Merger or Consolidation of, or Assumption of the
Obligations of, the Transferors...........................66
SECTION 7.03. Limitations on Liability of the Transferors.................67
SECTION 7.04. Liabilities.................................................68
ARTICLE VIII
Other Matters Relating to the Servicer
SECTION 8.01. Liability of the Servicer...................................68
SECTION 8.02. Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer..............................68
SECTION 8.03. Limitation on Liability of the Servicer and Others..........69
SECTION 8.04. Servicer Indemnification of the Trust and the Trustee.......70
SECTION 8.05. The Servicer Not To Resign..................................70
SECTION 8.06. Access to Certain Documentation and Information Regarding
the Receivables...........................................70
SECTION 8.07. Delegation of Duties........................................71
SECTION 8.08. Examination of Records......................................71
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ARTICLE IX
Pay Out Events
SECTION 9.01. Pay Out Events..............................................71
SECTION 9.02. Additional Rights upon the Occurrence of Certain Events.....73
ARTICLE X
Servicer Defaults
SECTION 10.01. Servicer Defaults..........................................74
SECTION 10.02. Trustee To Act: Appointment of Successor..................76
SECTION 10.03. Notification to Certificateholders.........................78
ARTICLE XI
The Trustee
SECTION 11.01. Duties of Trustee..........................................78
SECTION 11.02. Certain Matters Affecting the Trustee......................80
SECTION 11.03. Trustee Not Liable for Recitals in Certificates............81
SECTION 11.04. Trustee May Own Certificates...............................81
SECTION 11.05. The Servicer To Pay Trustee's Fees and Expenses............81
SECTION 11.06. Eligibility Requirements for Trustee.......................81
SECTION 11.07. Resignation or Removal of Trustee..........................82
SECTION 11.08. Successor Trustee..........................................82
SECTION 11.09. Merger or Consolidation of Trustee.........................83
SECTION 11.10. Appointment of Co-Trustee or Separate Trustee..............83
SECTION 11.11. Tax Returns................................................84
SECTION 11.12. Trustee May Enforce Claims Without Possession of
Certificates.............................................84
SECTION 11.13. Suits for Enforcement......................................84
SECTION 11.14. Rights of Certificateholders To Direct Trustee.............85
SECTION 11.15. Representations and Warranties of Trustee..................86
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SECTION 11.16. Maintenance of Office or Agency............................86
ARTICLE XII
Termination
SECTION 12.01. Termination of Trust.......................................86
SECTION 12.02. Final Distribution.........................................87
SECTION 12.03. Transferors' Termination Rights............................88
ARTICLE XIII
Miscellaneous Provisions
SECTION 13.01. Amendment; Waiver of Past Defaults.........................88
SECTION 13.02. Protection of Right, Title and Interest to Trust...........90
SECTION 13.03. Limitation on Rights of Certificateholders.................91
SECTION 13.04. GOVERNING LAW..............................................91
SECTION 13.05. Notices; Payments..........................................91
SECTION 13.06. Rule 144A Information......................................92
SECTION 13.07. Severability of Provisions.................................92
SECTION 13.08. Assignment.................................................93
SECTION 13.09. Certificates Nonassessable and Fully Paid..................93
SECTION 13.10. Further Assurances.........................................93
SECTION 13.11. Nonpetition Covenant.......................................93
SECTION 13.12. No Waiver; Cumulative Remedies.............................93
SECTION 13.13. Counterparts...............................................93
SECTION 13.14. Third-Party Beneficiaries..................................94
SECTION 13.15. Actions by Certificateholders..............................94
SECTION 13.16. Merger and Integration.....................................94
SECTION 13.17. Headings...................................................94
SECTION 13.18. Construction of Agreement..................................94
SECTION 13.19. Characterization of the Trust..............................94
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ARTICLE XIV
Transition Provisions
SECTION 14.01. Substitution Date..........................................95
SECTION 14.02. Assumption.................................................95
EXHIBITS
Exhibit A Form of Assignment of Receivables in Additional Accounts
Exhibit B Form of Reassignment of Receivables in Removed Accounts
Exhibit C Form of Annual Servicer's Certificate
Exhibit E-1 Private Placement Legend
Exhibit E-2 Representation Letter
Exhibit E-3 ERISA Legend
Exhibit F Form of Depository Agreement
Exhibit G-1 Form of Certificate of Foreign Clearing Agency
Exhibit G-2 Form of Alternate Certificate to be Delivered to Foreign
Clearing Agency
Exhibit G-3 Form of Certificate to be Delivered to Foreign Clearing Agency
Exhibit H-1 Form of Opinion of Counsel with Respect to Amendments
Exhibit H-2 Form of Opinion of Counsel with Respect to Accounts
Exhibit H-3 Form of Annual Opinion of Counsel
SCHEDULES
Schedule 1 List of Accounts (Deemed Incorporated)
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POOLING AND SERVICING AGREEMENT dated as of June 1,
1993, and amended and restated on February 5, 2002, among
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION, a banking
corporation organized and existing under the laws of the
United States ("Chase USA"; in its capacity as Servicer
hereunder, the "Servicer"); CARD ACQUISITION FUNDING LLC,
a Delaware limited liability company ("LLC" and, after the
Substitution Date, "Transferor"); CHASE USA in its
capacity as Transferor hereunder prior to the Subsitution
Date, and BANKERS TRUST COMPANY, a New York banking
corporation not in its individual capacity, but solely as
Trustee ("Trustee").
WHEREAS, the parties hereto desire to amend and restate the Pooling
and Servicing Agreement to read in its entirety as set forth below;
WHEREAS, the parties hereto desire that LLC agree pursuant hereto to
assume all of the covenants and obligations of the Transferor hereunder; and
WHEREAS, concurrently with the amendment and restatement of the
Pooling and Servicing Agreement, Chase USA is contributing in part and selling
in part the Transferor Interest to LLC.
NOW, THEREFORE, pursuant to Section 13.01(a) of the Pooling and
Servicing Agreement, the parties hereto hereby agree that effective on and as
of the Substitution Date (as defined in Section 14), the Pooling and Servicing
Agreement (including, to the extent provided for herein, schedules and
exhibits thereto) is hereby amended to read in its entirety as set forth
below.
In consideration of the mutual agreements herein contained, each
party agrees as follows for the benefit of the other parties, the
Certificateholders and any Series Enhancer to the extent provided herein and
in any Supplement:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. Whenever used in this Agreement, the
following words and phrases shall have the following meanings, and the
definitions of such terms are applicable to the singular as well as the plural
forms of such terms and to the masculine as well as to the feminine and neuter
genders of such terms.
"Account" shall mean each Initial Account and each Additional
Account, but shall exclude any Account all the Receivables in which are either
reassigned or assigned to a Transferor or its designee or the Servicer in
accordance with the terms of this Agreement. "Account" shall also mean each
account into which an Account is transferred (a "Transferred Account");
provided that (a) such transfer is made in accordance with the Lending
Guidelines and (b) such Transferred Account can be traced or identified, by
reference to or by way of the computer files or microfiche lists delivered to
the Trustee pursuant to Section 2.01 or 2.08(g), as
an account into which an Account has been transferred. The term "Account"
shall be deemed to refer to an Additional Account only from and after the
Addition Date with respect thereto, and the term "Account" shall be deemed to
refer to any Removed Account only prior to the Removal Date with respect
thereto.
"Account Owner" shall mean Chase USA and, when the context so
requires, its predecessors in interest hereunder, and its successors and
assigns and any Additional Account Owner.
"Accumulation Period" shall mean, with respect to any Series, the
period, if any, specified as such in the related Supplement.
"Act" shall mean the Securities Act of 1933, as amended.
"Addition" shall mean the designation of additional Eligible
Accounts to be included as Accounts or of Participation Interests to be
included as Trust Assets pursuant to Section 2.08(a), (b) or (c).
"Addition Date" shall mean (a) with respect to Additional Accounts,
the date on which the Receivables in such Additional Accounts are conveyed to
the Trust pursuant to Section 2.08(a), (b) or (c) and (b) with respect to
Participation Interests, the date from and after which such Participation
Interests are to be included as Trust Assets pursuant to Section 2.08(a) or
(b).
"Additional Account" shall mean each revolving credit card account
or other revolving credit account established pursuant to a Lending Agreement,
which account is designated pursuant to Section 2.08(a), (b) or (c) to be
included as an Account and is identified in a computer file or microfiche list
delivered to the Trustee by the applicable Transferor pursuant to Sections
2.01 and 2.08(g).
"Additional Account Owner" shall have the meaning specified in
Section 2.08(h).
"Additional Cut-Off Date" shall mean the date as of which any
Additional Accounts or Participation Interests are to be included in the
Trust, as specified in the related Assignment.
"Additional Finance Charges" shall have the meaning specified in
Section 4.05.
"Additional Transferor" shall have the meaning specified in Section
2.08(f).
"Adjustment Payment" shall have the meaning specified in Section
3.09(a).
"Affiliate" shall mean, with respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" shall mean
the power to direct the management and policies of a Person, directly or
indirectly, whether through the ownership of voting securities, by contract or
otherwise; and the terms "controlling" and "controlled" have meanings
correlative to the foregoing.
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"Aggregate Addition Limit" shall mean the number of accounts
designated as Automatic Additional Accounts, without prior Rating Agency
consent, and designated as Additional Accounts pursuant to Section 2.08(a),
without the prior Rating Agency notice described under Section 2.08(d)(v),
which would either (x) with respect to any of the three consecutive Monthly
Periods commencing in January, April, July and October of each calendar year
commencing in July 1993 equal 15% of the number of Accounts as of the first
day of the calendar year during which such Monthly Periods commence (or the
Trust Cut-Off Date, in the case of 1993) or (y) with respect to any
twelve-month period equal 20% of the number of Accounts as of the first day of
such twelve-month period.
"Agreement" shall mean this Pooling and Servicing Agreement as
amended and restated and all amendments hereof and supplements hereto,
including, with respect to any Series or Class, the related Supplement.
"Allocated Interchange" shall have the meaning set forth in the
Receivables Purchase Agreement.
"Applicants" shall have the meaning specified in Section 6.08.
"Appointment Date" shall have the meaning specified in Section
9.02(a).
"Assignment" shall have the meaning specified in Section 2.08(g).
"Authorized Newspaper" shall mean any newspaper or newspapers of
general circulation in the Borough of Manhattan, The City of New York, printed
in the English language (and, with respect to any Series or Class, if and so
long as the Investor Certificates of such Series or Class are listed on the
Luxembourg Stock Exchange and such exchange shall so require, in Luxembourg,
printed in any language satisfying the requirements of such exchange) and
customarily published on each business day at such place, whether or not
published on Saturdays, Sundays or holidays.
"Automatic Additional Account" shall mean each revolving credit card
account or other revolving credit account established pursuant to a Lending
Agreement, which account is designated pursuant to Section 2.08(c) to be
included as an Account and is identified in a computer file or microfiche list
delivered to the Trustee by the applicable Transferor pursuant to Sections
2.01 and 2.08(g).
"Bank" shall mean Chase USA and its successors and assigns.
"Bank Portfolio" shall mean the MasterCard and VISA credit card
accounts owned by Chase USA.
"Base Interest" shall mean the interest of the Transferor and any
Additional Transferors in the Trust.
"Bearer Certificates" shall have the meaning specified in Section
6.01.
"Benefit Plan" shall have the meaning specified in Section 6.04(c).
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"Book-Entry Certificates" shall mean beneficial interests in the
Investor Certificates, ownership and transfers of which shall be made through
book entries by a Clearing Agency as described in Section 6.10.
"Business Day" shall mean any day other than (a) a Saturday or
Sunday or (b) any other day on which national banking associations or state
banking institutions in New York, New York are authorized or obligated by law,
executive order or governmental decree to be closed or (c) prior to the
Servicing Transition Date, any other day on which national banking
associations or state banking institutions in ▇▇▇▇▇▇, New Hampshire or San
Francisco, California, are authorized or obligated by law, executive order or
governmental decree to be closed.
"Certificate" shall mean any one of the Investor Certificates.
"Certificate Owner" shall mean, with respect to a Book-Entry
Certificate, the Person who is the owner of such Book-Entry Certificate, as
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing Agency (directly or as an indirect
participant, in accordance with the rules of such Clearing Agency).
"Certificate Rate" shall mean, with respect to any Series or Class,
the certificate rate specified therefor in the related Supplement.
"Certificate Register" shall mean the register maintained pursuant
to Section 6.04, providing for the registration of the Registered Certificates
and transfers and exchanges thereof.
"Certificateholders" or "Holder" shall mean an Investor
Certificateholder or an owner of the Transferors' Interest.
"Certificateholders' Interest" shall have the meaning specified
in Section 4.01.
"Class" shall mean, with respect to any Series, any one of the
classes of Investor Certificates of that Series.
"Clearing Agency" shall mean an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended.
"Clearing Agency Participant" shall mean a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities
deposited with the Clearing Agency.
"Clearstream" shall mean Clearstream Banking, societe anonyme.
"Closing Date" shall mean, with respect to any Series, the closing
date specified in the related Supplement.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"Collection Account" shall have the meaning specified in Section
4.02.
4
"Collections" shall mean (a) all payments (excluding Insurance
Proceeds and other amounts constituting Recoveries of Principal Receivables or
Finance Charge Receivables) received by the Servicer in respect of the
Receivables, in the form of cash, checks (to the extent collected), wire
transfers, ATM transfers or other form of payment in accordance with the
Lending Agreement in effect from time to time on any Receivables and, (b) with
respect to any Monthly Period, the Allocated Interchange to be paid to the
Transferor pursuant to the Receivables Purchase Agreement.
"Commission" shall have the meaning specified in Section 3.10.
"Corporate Trust Office" shall have the meaning specified in Section
11.16.
"Coupon" shall have the meaning specified in Section 6.01.
"Date of Processing" shall mean, with respect to any transaction,
the Business Day such transaction is first recorded under the Servicer's (or,
in the case of any Transferor, such Transferor's) customary and usual
servicing practices on the Servicer's (or, in the case of any Transferor, such
Transferor's) computer file of consumer revolving accounts.
"Defaulted Amount" shall mean, with respect to any Monthly Period,
an amount (which shall not be less than zero) equal to (a) the amount of
Principal Receivables which became Defaulted Receivables in such Monthly
Period, minus (b) the sum of (i) the amount of any Defaulted Receivables
included in any Account the Receivables in which a Transferor or the Servicer
became obligated to accept reassignment or assignment in accordance with the
terms of this Agreement during such Monthly Period, (ii) the amount of
Recoveries received in such Monthly Period with respect to Finance Charge
Receivables and Principal Receivables previously charged off as uncollectible
and (iii) the excess, if any, for the immediately preceding Monthly Period of
the sum computed pursuant to this clause (b) for such Monthly Period over the
amount of Principal Receivables which became Defaulted Receivables in such
Monthly Period; provided, however, that, if an Insolvency Event occurs with
respect to any Transferor, the amount of such Defaulted Receivables which are
subject to reassignment to such Transferor in accordance with the terms of
this Agreement shall not be added to the sum so subtracted and, if any of the
events described in Section 10.01(d) occur with respect to the Servicer, the
amount of such Defaulted Receivables which are subject to reassignment or
assignment to the Servicer in accordance with the terms of this Agreement
shall not be added to the sum so subtracted.
"Defaulted Receivable" shall mean, with respect to any Monthly
Period, all Principal Receivables in any Account which are charged off as
uncollectible in such Monthly Period in accordance with the Lending Guidelines
and the Servicer's customary and usual servicing procedures for servicing
revolving credit card and other consumer revolving credit account receivables
comparable to the Receivables. A Principal Receivable in any Account shall
become a Defaulted Receivable on the day on which such Principal Receivable is
recorded as charged off on the Servicer's computer master file of consumer
credit accounts but, in any event, shall be deemed a Defaulted Receivable no
later than the day such Account becomes 180 days delinquent (210 days after
the date of the billing statement) unless the Obligor cures such default by
making a partial payment which satisfies the criteria for curing delinquencies
set forth in the Lending Guidelines of the Transferor which owns such
Accounts.
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"Definitive Certificates" shall have the meaning specified in
Section 6.10.
"Definitive Euro-Certificates" shall have the meaning specified in
Section 6.13.
"Deposit Date" shall mean each day on which the Servicer deposits
Collections in the Collection Account.
"Depositaries" shall mean the Person specified in the applicable
Supplement, in its capacity as depositary for the respective accounts of any
Clearing Agency or any Foreign Clearing Agencies.
"Depository Agreement" shall mean, with respect to any Series or
Class, the agreement among the Transferors, the Trustee and the initial
Clearing Agency substantially in the form of Exhibit F.
"Determination Date" shall mean the third Business Day prior to each
Distribution Date.
"Distribution Date" shall mean the 15th day of each calendar month
during the term hereof, or, if such 15th day is not a Business Day, the next
succeeding Business Day.
"Document Delivery Date" shall mean the first Closing Date in the
case of Initial Accounts and the Addition Date in the case of Additional
Accounts.
"Early Amortization Period" shall mean, with respect to any Series,
the period beginning at the close of business on the Business Day immediately
preceding the day on which a Pay Out Event is deemed to have occurred with
respect to such Series, and ending upon the earlier to occur of (a) the
payment in full to the Investor Certificateholders of such Series of the
Invested Amount with respect to such Series and the payment in full to any
applicable Series Enhancer with respect to such Series of the Enhancement
Invested Amount, if any, with respect to such Series and (b) the Series
Termination Date with respect to such Series.
"Eligible Account" shall mean a revolving credit card account or
other consumer revolving credit account owned by the Account Owner which as of
the Trust Cut-Off Date with respect to an Initial Account or as of the related
Addition Date with respect to an Additional Account: (a) is in existence and
maintained with the Account Owner or an Affiliate thereof on the Trust Cut-Off
Date or the Addition Date, as the case may be; (b) is payable in United States
dollars; (c) except as provided below, has not been identified as an account
the credit cards or checks, if any, with respect to which have been reported
to the Account Owner as having been lost or stolen; (d) the Obligor of which
has provided, as his or her billing address at the date such account was
opened, an address located in the United States (or its territories or
possessions or a military address); (e) has not been, and does not have any
Receivables which have been, sold, pledged, assigned or otherwise conveyed to
any person (except pursuant to the Receivables Purchase Agreement or this
Agreement), unless any such pledge or assignment is released on or before the
initial Closing Date or the Addition Date, as applicable; (f) except as
provided below, does not have any Receivables which are Defaulted Receivables;
and (g) except as provided below, does not have any Receivables which have
been identified by the Account Owner or the relevant Obligor as having been
incurred as a result of fraudulent use of any related credit card or
6
check. Eligible Accounts may include accounts, the receivables of which have
been written off, or with respect to which the Servicer believes the related
Obligor is bankrupt, or as to which certain receivables have been identified
by the Obligor as having been incurred as a result of fraudulent use of any
credit cards or checks, or as to which any credit cards or checks have been
reported to the Account Owner as lost or stolen; provided that (i) the balance
of all receivables included in such accounts is reflected on the books and
records of such Transferor (and is treated for purposes of this Agreement) as
"zero", and (ii) charging or check writing privileges with respect to all such
accounts have been canceled in accordance with the Lending Guidelines and will
not be reinstated by the Account Owner or the Servicer.
"Eligible Deposit Account" shall mean either (a) a segregated
account with an Eligible Institution or (b) a segregated trust account with
the corporate trust department of a depository institution organized under the
laws of the United States or any one of the states thereof, including the
District of Columbia (or any domestic branch of a foreign bank), and acting as
a trustee for funds deposited in such account, so long as any of the
securities of such depository institution shall have a credit rating from each
Rating Agency in one of its generic credit rating categories which signifies
investment grade.
"Eligible Institution" shall mean a depository institution (which
may be the Trustee) organized under the laws of the United States or any one
of the states thereof which at all times (a) has either (i) a long-term
unsecured debt rating of A2 or better by Moody's or (ii) a certificate of
deposit rating of P-1 by Moody's, (b) has either (i) a long-term unsecured
debt rating of AAA by Standard & Poor's or (ii) a certificate of deposit
rating of A-1+ by Standard & Poor's and (c) is a member of the FDIC.
"Eligible Investments" shall mean any of the following:
(a) direct obligations of, and obligations fully guaranteed as to
timely payment of principal and interest by, the United States of America;
(b) demand deposits, time deposits or certificates of deposit (that
mature no more than 90 days after the date of investment) of depository
institutions or trust companies incorporated under the laws of the United
States of America or any state thereof (or domestic branches of foreign banks)
and subject to supervision and examination by federal or state banking or
depository institution authorities; provided that at the time of the Trust's
investment or contractual commitment to invest therein, the short-term debt
rating of such depository institution or trust company shall be in the highest
investment category of each Rating Agency;
(c) commercial paper or other short-term obligations (that mature no
more than 90 days after the date of investment) having, at the time of the
Trust's investment or contractual commitment to invest therein, a rating from
each Rating Agency in its highest investment category;
(d) demand deposits, time deposits and certificates of deposit (that
mature no more than 90 days after the date of investment) which are fully
insured by the FDIC, with a Person the commercial paper of which has a credit
rating from each Rating Agency in its highest investment category;
7
(e) notes or bankers' acceptances (that mature no more than 90 days
after the date of investment) issued by any depository institution or trust
company referred to in (b) above; or
(f) investments in money market funds rated in the highest
investment category by each Rating Agency or otherwise approved in writing by
each Rating Agency;
provided, however, that no obligation of the Transferor or any
Additional Account Owner or any Affiliate thereof shall constitute an Eligible
Investment.
"Eligible Receivable" shall mean each Receivable:
(a) which has arisen under an Eligible Account;
(b) which was created in compliance with the Lending Guidelines and
all Requirements of Law applicable to the Account Owner, the failure to comply
with which would have a material adverse effect on Investor
Certificateholders, and pursuant to a Lending Agreement which complies with
all Requirements of Law applicable to the Account Owner, the failure to comply
with which would have a material adverse effect on Investor
Certificateholders;
(c) with respect to which all consents, licenses, approvals or
authorizations of, or registrations with, any Governmental Authority required
to be obtained or given by the Account Owner in connection with the creation
of such Receivable or the execution, delivery and performance by the Account
Owner of its obligations, if any, under the related Lending Agreement have
been duly obtained or given and are in full force and effect as of such date
of creation of such Receivable;
(d) as to which, at the time of its transfer to the Trust, the
Transferor transferring the Receivables or the Trust will have good and
marketable title free and clear of all Liens (other than any Lien for
municipal or other local taxes if such taxes are not then due and payable or
if the Account Owner is then contesting the validity thereof in good faith by
appropriate proceedings and has set aside on its books adequate reserves with
respect thereto);
(e) which has been the subject of either a valid transfer and
assignment from such Transferor to the Trust of all such Transferor's right,
title and interest therein or the grant of a first priority perfected security
interest therein (and in the proceeds thereof), effective until the
termination of the Trust;
(f) which at and after the time of transfer to the Trust is the
legal, valid and binding payment obligation of the Obligor thereon, legally
enforceable against such Obligor in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws, now or hereafter in effect,
affecting the enforcement of creditors' rights in general and except as such
enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity);
(g) which constitutes an "account" as defined in Article 9 of the
UCC;
8
(h) which, at the time of its transfer to the Trustee, has not been
waived or modified except as permitted in accordance with Section 3.03(h);
(i) which, at the time of its transfer to the Trustee, is not
subject to any right of rescission, setoff, counterclaim or any other defense
of the Obligor (including the defense of usury), other than defenses arising
out of applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights in general and
except as such enforceability may be limited by general principles of equity
(whether considered in a suit at law or equity) or as to which the Servicer is
required by Section 3.09 to make an adjustment;
(j) as to which, at the time of its transfer to the Trustee, the
Account Owner and such Transferor has satisfied all obligations to be
fulfilled at the time it is transferred to the Trustee;
(k) as to which, at the time of its transfer to the Trustee, neither
the Account Owner nor such Transferor has taken any action which, or failed to
take any action the omission of which, would, at the time of its transfer to
the Trustee, impair the rights of the Trustee or the Certificateholders
therein; and
(l) which, if arising under an Account which was not originated by
the Account Owner or an Affiliate of the Account Owner, will not be designated
as an Additional Account unless the Rating Agency Condition shall have been
satisfied.
"Eligible Servicer" shall mean the Trustee or an entity which, at
the time of its appointment as Servicer,
(a) is servicing a portfolio of consumer revolving credit card
accounts or other consumer revolving credit accounts,
(b) is legally qualified and has the capacity to service the
Accounts,
(c) is qualified to use the software that is then being used to
service the Accounts or obtains the right to use, or has its own, software
which is adequate to perform its duties under this Agreement,
(d) in the sole determination of the Trustee, which determination
shall be conclusive and binding, has demonstrated the ability to
professionally and competently service a portfolio of similar accounts and
(e) has a net worth of at least $50,000,000 as of the end of its
most recent fiscal quarter.
"Enhancement Agreement" shall mean any agreement, instrument or
document governing the terms of any Series Enhancement or pursuant to which
any Series Enhancement is issued or outstanding.
9
"Enhancement Invested Amount", with respect to any Series, shall
have the meaning specified in the related Supplement.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"Euroclear Operator" shall mean Euroclear Bank S.A./N.V., as
operator of the Euroclear System.
"Exchange Date" shall mean, with respect to any Series, any date
that is after the related Series Issuance Date, in the case of Definitive
Euro-Certificates in registered form, or upon presentation of certification of
non-United States beneficial ownership (as described in Section 6.13), in the
case of Definitive Euro-Certificates in bearer form.
"Excluded Series" shall mean any Series designated as such in the
relevant Supplement.
"FDIC" shall mean the Federal Deposit Insurance Corporation or any
successor.
"FDR" shall have the meaning specified in Section 8.07.
"Finance Charge Receivables" shall mean, with respect to any Monthly
Period, all Receivables that represent amounts billed to the Obligors on any
Account at the beginning of such Monthly Period and in respect of (i) Periodic
Finance Charges, (ii) Returned Cash Advance Check Fees, (iii) Late Fees, (iv)
Overlimit Fees, (v) Returned Payment Check Fees and (vi) all other fees and
charges (excluding Principal Receivables). Collections of Finance Charge
Receivables, with respect to any Monthly Period, shall include (i) a portion,
determined pursuant to Section 2.07(i), of the Allocated Interchange paid to
the Account Owner through the MasterCard System, the VISA System and any other
similar entity's or organization's system relating to consumer revolving
credit card accounts with respect to such Monthly Period.
"Finance Charge Shortfalls" shall have the meaning specified in
Section 4.05.
"Floating Allocation Percentage" shall mean, with respect to any
Series, the floating allocation percentage specified in the related
supplement.
"Foreign Clearing Agency" shall mean Clearstream and the Euroclear
Operator.
"Global Certificate" shall have the meaning specified in Section
6.13(a).
"Governmental Authority" shall mean the United States of America,
any state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Group" shall mean, with respect to any Series, the group of Series,
if any, in which the related Supplement specifies such Series is to be
included.
10
"Grouped Charge Off Disposition" shall mean a transaction in which
all or substantially all of the assets sold or re-securitized consist of
previously charged off amounts.
"Ineligible Receivables" shall have the meaning specified in Section
2.05(a).
"Initial Account" shall mean each MasterCard Registered Trademark*
and VISA Registered Trademark* account established pursuant to a Lending
Agreement between the Account Owner and any Person, and identified by account
number and by the Receivable balance in a computer file or microfiche list
delivered to the Trustee by the Account Owner on or prior to the first Closing
Date pursuant to Section 2.01.
"Insolvency Event" shall have the meaning specified in Section
9.01(c).
"Insolvency Proceeds" shall have the meaning specified in Section
9.02(b).
"Insurance Proceeds" shall mean all Insurance Proceeds as defined in
the Receivables Purchase Agreement that are paid to the Transferor as provided
in the Receivables Purchase Agreement.
"Interchange" shall mean interchange fees payable to the Account
Owner, in its capacity as credit card issuer, through the MasterCard System,
the VISA System and any other similar entity's or organization's system
relating to consumer revolving credit card accounts in connection with
cardholder charges for goods and services.
"Interim Processing Agreement" shall mean the Interim Processing
Agreement, dated as of January, 2002 between Chase USA and Providian National
Bank, as the same may from time to time be amended, modified or otherwise
supplemented.
"Invested Amount" shall mean, with respect to any Series and for any
date, an amount equal to the invested amount specified in the related
Supplement.
"Investment Company Act" shall mean the Investment Company Act of
1940, as amended.
"Investor Certificateholder" shall mean the Person in whose name a
Registered Certificate is registered in the Certificate Register or the bearer
of any Bearer Certificate (or the Global Certificate, as the case may be) or
Coupon.
"Investor Certificates" shall mean any one of the certificates
(including the Bearer Certificates, the Registered Certificates or any Global
Certificate) executed by the Transferors and authenticated by or on behalf of
the Trustee, substantially in the form attached to the related Supplement.
* MasterCard Registered Trademark and VISA Registered Trademark are
registered trademarks of MasterCard International Incorporated and of VISA,
USA, Inc., respectively.
11
"Late Fees" shall mean the fees specified in the Lending Agreement
applicable to each Account for late fees with respect to such Account.
"Lending Agreement" shall mean, with respect to an Account, the
agreements between the Account Owner which owns such Account and the related
Obligor, governing the terms and conditions of such Account, as such
agreements may be amended, modified or otherwise changed from time to time and
as distributed (including any amendments and revisions thereto) to holders of
such consumer revolving accounts.
"Lending Guidelines" shall mean, with respect to the Account Owner,
such Account Owner's written policies and procedures relating to the operation
of its consumer revolving lending business, including, without limitation, the
written policies and procedures for determining the creditworthiness of credit
card or other revolving credit account customers, the extension of credit to
credit card and other revolving credit account customers and relating to the
maintenance of credit card and other revolving credit accounts and collection
of receivables with respect thereto, as such policies and procedures may be
amended, modified, or otherwise changed from time to time in conformance with
all Requirements of Law, the failure to comply with which would have a
material adverse effect on interests hereunder of Investor Certificateholders.
"Lien" shall mean any security interest, mortgage, deed of trust,
pledge, hypothecation, assignment, participation or equity interest, deposit
arrangement, encumbrance, lien (statutory or other), preference, priority or
other security agreement or preferential arrangement of any kind or nature
whatsoever, including any conditional sale or other title retention agreement,
any financing lease having substantially the same economic effect as any of
the foregoing, excluding any lien or filing pursuant to this Receivables
Purchase Agreement or this Agreement; provided, however, that any assignment
or transfer pursuant to Section 6.03(c) or (d) or Section 7.02 shall not be
deemed to constitute a Lien.
"Limited Liability Company Agreement" shall mean the Limited
Liability Company Agreement of LLC, dated February 5, 2002, as the same may
from time to time be amended, modified or supplemented.
"Lockbox Institution" shall have the meaning specified in Section
8.07.
"Manager" shall mean the lead manager, manager or co-manager or
person performing a similar function with respect to an offering of Definitive
Euro-Certificates.
"MasterCard" shall mean MasterCard International Incorporated.
"Monthly Period" shall mean with respect to each Distribution Date,
the period from and including the first day of the preceding calendar month to
and including the last day of such calendar month; provided, however, that the
initial Monthly Period with respect to any Series will commence on the Cut-Off
Date with respect to such Series.
"Moody's" shall mean ▇▇▇▇▇'▇ Investors Service, Inc., or its
successor.
"Monthly Servicing Fee" shall have the meaning specified in Section
3.02.
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"Obligor" shall mean, with respect to any Account, the Person or
Persons obligated to make payments with respect to such Account, including any
guarantor thereof, but excluding any merchant.
"Officer's Certificate" shall mean, unless otherwise specified in
this Agreement, a certificate delivered to the Trustee signed by the Chairman
of the Board, President, any Vice President or the Treasurer of a Transferor
or the Servicer, as the case may be.
"Opinion of Counsel" shall mean a written opinion of counsel, who
may be counsel for, or an employee of, the Person providing the opinion and
who shall be reasonably acceptable to the Trustee.
"Overlimit Fees" shall mean the fees specified in the Lending
Agreement applicable to each Account for overlimit fees if such fees are
provided for with respect to such Account.
"Participating Transferor" shall have the meaning specified in
Section 2.08(d).
"Participation Interests" shall have the meaning specified in
Section 2.08(a).
"Pay Out Event" shall mean, with respect to any Series, each event
specified in Section 9.01 and each additional event, if any, specified in the
relevant Supplement as a Pay Out Event with respect to such Series.
"Paying Agent" shall mean any paying agent and co-paying agent
appointed pursuant to Section 6.07.
"Periodic Finance Charges" shall have the meaning specified in the
Lending Agreement applicable to each Account for finance charges (due to
periodic rate) or any similar term.
"Person" shall mean any legal person, including any individual,
corporation, partnership, limited liability company, joint venture,
association, joint-stock company, trust, unincorporated organization,
governmental entity or other entity or any other entity of any nature.
"Principal Allocation Percentage" shall mean, with respect to any
Series, the principal allocation percentage specified in the related
Supplement.
"Principal Receivables" shall mean all Receivables that represent
amounts charged by Obligors for merchandise and services and cash advances,
but shall not include Defaulted Receivables. In calculating the aggregate
amount of Principal Receivables on any day, the amount of Principal
Receivables shall be reduced by the aggregate amount of credit balances in the
Accounts on such day. Any Receivables which the related Transferor is unable
to transfer as provided in Section 2.10 shall not be included in calculating
the aggregate amount of Principal Receivables, except to the extent so
provided in Section 2.10.
"Principal Shortfalls" shall have the meaning specified in Section
4.04.
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"Principal Terms" shall mean, with respect to any Series, (a) the
name or designation; (b) the initial principal amount (or method for
calculating such amount); (c) the Certificate Rate (or method for the
determination thereof); (d) the payment date or dates and the date or dates
from which interest shall accrue; (e) the method for allocating collections to
Certificateholders of such Series; (f) the designation of any Series Accounts
and the terms governing the operation of any such Series Accounts; (g) the
method of calculating the servicing fee with respect thereto; (h) the terms of
any form of Series Enhancement with respect thereto; (i) the terms on which
the Investor Certificates of such Series may be exchanged for Investor
Certificates of another Series, repurchased by the Transferors or remarketed
to other investors; (j) the Series Termination Date; (k) the number of Classes
of Investor Certificates of such Series and, if such Series consists of more
than one Class, the rights and priorities of each such Class; (l) the extent
to which the Investor Certificates of such Series will be issuable in
temporary or permanent global form (and, in such case, the depositary for such
Global Certificate or Certificates, the terms and conditions, if any, upon
which such Global Certificate may be exchanged, in whole or in part, for
Definitive Certificates, and the manner in which any interest payable on a
temporary or Global Certificate will be paid); (m) whether the Investor
Certificates of such Series may be issued as Bearer Certificates and any
limitations imposed thereon; (n) the priority of such Series with respect to
any other Series; (o) the Group, if any, to which such Series belongs; and (p)
any other terms of such Series.
"Rating Agency" shall mean, with respect to any outstanding Series
or Class, each statistical rating agency selected by the Transferors to rate
the Investor Certificates of such Series or Class.
"Rating Agency Condition" shall mean, with respect to any action,
that each Rating Agency shall have notified the Transferors, the Servicer and
the Trustee in writing that such action will not result in a reduction or
withdrawal of the rating of any outstanding Series or Class with respect to
which it is a Rating Agency.
"Reassignment" shall have the meaning specified in Section 2.09.
"Receivable" shall mean any amount owing by the Obligor under an
Account from time to time, including amounts owing for purchases of goods and
services, cash advances and access charges and amounts payable for Finance
Charge Receivables to the extent that such amounts owing have been conveyed by
the Account Owner to the Transferor pursuant to the Receivables Purchase
Agreement. A Receivable shall be deemed to have been created at the end of the
day on the Date of Processing of such Receivable. Receivables which become
Defaulted Receivables shall not be shown on the Servicer's records as amounts
payable (and shall cease to be included as Receivables) on the day on which
they become Defaulted Receivables.
"Receivables Purchase Agreement" shall mean, with respect to LLC, as
Transferor, the Receivables Purchase Agreement dated as of February 5, 2002
between Chase USA, as Account Owner, and LLC, as amended and supplemented from
time to time and with respect to any Additional Transferor, the receivables
purchase agreement entered into by such Additional Transferor or another
Account Owner as provided in Section 2.08(h).
14
"Record Date" shall mean, with respect to any Distribution Date, the
last Business Day of the preceding Monthly Period, except as otherwise
provided with respect to a Series in the related Supplement.
"Recoveries" shall mean (i) with respect to any Monthly Period
commencing prior to the Servicing Transition Date, all amounts received by the
Servicer with respect to Receivables which have previously become Defaulted
Receivables, including Insurance Proceeds, and shall include any cash proceeds
received by the Transferors initially upon the sale or re-securitization by
the Transferors of Defaulted Receivables removed from the Trust to the extent
such sale or re-securitization is made pursuant to a Grouped Charge Off
Disposition, and excluding, in the case of any such Defaulted Receivables
removed from the Trust, (a) any amount received by the Transferors other than
pursuant to a Grouped Charge Off Disposition and (b) any amounts received by
the Transferors with respect to Defaulted Receivables removed from the Trust
pursuant to a Grouped Charge Off Disposition if such amounts do not constitute
cash proceeds received by the Transferors upon the initial sale or
re-securitization of such Defaulted Receivables and (ii) with respect to any
Monthly Period commencing on or after the Servicing Transition Date, the
product of (a) all amounts recorded as recoveries on the Bank Portfolio by the
Servicer during such Monthly Period or such shorter period, as the case may
be, and (b) a fraction, the numerator of which shall be the Defaulted
Receivables for such Monthly Period or shorter period, as applicable, and the
denominator of which shall be the aggregate amount of Principal Receivables in
the Bank Portfolio which were charged off by the Servicer as uncollectible for
such Monthly Period.
"Registered Certificateholder" shall mean the Holder of a Registered
Certificate.
"Registered Certificates" shall have the meaning specified in
Section 6.01.
"Removal Date" shall have the meaning specified in Section 2.09(a).
"Removal Notice Date" shall have the meaning specified in subsection
2.09(a).
"Removed Accounts" shall have the meaning specified in Section 2.09.
"Required Designation Date" shall have the meaning specified in
Section 2.08(a).
"Required Principal Balance" shall mean, as of any date of
determination, (a) the sum of the initial Invested Amount of the Investor
Certificates of each Series outstanding on such date (other than any Series or
portion thereof which is designated in the relevant Supplement as being an
Excluded Series) minus (b) the principal amount on deposit in the Special
Funding Account on such date; provided, however, if at any time the only
Series outstanding are Excluded Series and a Pay Out Event has occurred with
respect to one or more of such Series, the Required Principal Balance shall
mean (a) the sum of the Invested Amount of each such Excluded Series as of the
earliest date on which any such Pay Out Event is deemed to have occurred,
minus (b) the principal amount on deposit in the Special Funding Account.
"Required Transferors' Participation Amount" shall mean, with
respect to any date, an amount equal to the product of the Required
Transferors' Percentage and the sum of (a)
15
the aggregate amount of Principal Receivables and (b) the aggregate principal
amount on deposit in the Special Funding Account on such date.
"Required Transferors' Percentage" shall mean 7%; provided, however,
that the Transferors may reduce or increase the Required Transferors'
Percentage upon (x) 30 days' prior notice to the Trustee, each Rating Agency
and any Series Enhancer entitled to receive such notice pursuant to the
relevant Supplement, (y) satisfaction of the Rating Agency Condition with
respect thereto and (z) delivery to the Trustee and each such Series Enhancer
of a certificate of a Vice President or more senior officer of each Transferor
stating that such Transferor reasonably believes that such reduction will not,
based on the facts known to such officer at the time of such certification,
then or thereafter cause a Pay Out Event to occur with respect to any Series;
provided further that the Required Transferors' Percentage shall not at any
time be less than 2% nor more than 7%.
"Requirements of Law" with respect to any Person shall mean the
certificate of incorporation, certificate of formation, or articles of
association and By-laws or limited liability company agreement or other
organizational or governing documents of such Person, and any law, treaty,
rule or regulation, or determination of an arbitrator or Governmental
Authority, in each case applicable to or binding upon such Person or to which
such Person is subject, whether Federal, state or local (including, without
limitation, usury laws, the Federal Truth in Lending Act and Regulation Z and
Regulation B of the Board of Governors of the Federal Reserve System).
"Responsible Officer" shall mean any Vice President, any Assistant
Vice President, any Assistant Secretary, any Assistant Treasurer, or any other
officer of the Trustee customarily performing functions similar to those
performed by any of the above-designated officers and also, with respect to a
particular matter, any other officer to whom such matter is referred because
of such officer's knowledge of and familiarity with the particular subject.
"Returned Cash Advance Check Fee" shall mean the fees specified in
the Lending Agreement applicable to each Account payable for returned checks
drawn on an Account.
"Returned Payment Check Fee" shall mean the fees specified in the
Lending Agreement applicable to each Account for returned payment checks.
"Revolving Period" shall mean, with respect to any Series, the
period specified as such in the related Supplement.
"Rule 144A" shall mean Rule 144A under the Act, as such Rule may be
amended from time to time.
"Scheduled Amortization Period" shall mean, with respect to any
Series, the period, if any, specified as such in the related Supplement.
"Sellers" shall mean the entity or entities which were, on a
specified date, a seller or the sellers to the Trust prior to the Substitution
Date.
16
"Series" shall mean any series of Investor Certificates established
pursuant to a Supplement.
"Series Account" shall mean any deposit, trust, escrow or similar
account maintained for the benefit of the Investor Certificateholders of any
Series or Class, as specified in any Supplement.
"Series Enhancement" shall mean the rights and benefits provided to
the Investor Certificateholders of any Series or Class pursuant to any letter
of credit, surety bond, cash collateral account, spread account, guaranteed
rate agreement, maturity liquidity facility, tax protection agreement,
interest rate swap agreement, interest rate cap agreement or other similar
arrangement. The subordination of any Class to another Class shall be deemed
to be a Series Enhancement.
"Series Enhancer" shall mean the Person or Persons providing any
Series Enhancement, other than the Investor Certificateholders of any Class
which is subordinated to another Class.
"Series Issuance Date" shall mean, with respect to any Series, the
date on which the Investor Certificates of such Series are to be originally
issued in accordance with Section 6.03 and the related Supplement.
"Series Termination Date" shall mean, with respect to any Series,
the termination date specified in the related Supplement.
"Service Transfer" shall have the meaning specified in Section
10.01.
"Servicer" shall mean the Bank, in its capacity as Servicer pursuant
to this Agreement, and, after any Service Transfer, the Successor Servicer.
"Servicer Default" shall have the meaning specified in Section
10.01.
"Servicing Fee" shall have the meaning specified in Section 3.02.
"Servicing Fee Rate" shall mean, with respect to any Series, the
servicing fee rate specified in the related Supplement.
"Servicing Transition Date" shall mean the first date on which all
of the Accounts are processed by FDR.
"Servicing Officer" shall mean any officer of the Servicer involved
in, or responsible for, the administration and servicing of the Receivables
whose name appears on a list of servicing officers furnished to the Trustee by
the Servicer, as such list may from time to time be amended.
"SFAS 140" shall mean Statement of Financial Accounting Standards
No. 140, Accounting for Transfers and Servicing of Financial Assets
and Extinguishments of Liabilities.
17
"Shared Principal Collections" shall have the meaning specified in
Section 4.04.
"Special Funding Account" shall have the meaning specified in
Section 4.02.
"Standard & Poor's" shall mean Standard & Poor's Corporation or its
successor.
"Substitition Date" shall have the meaning specified in Section
14.01.
"Successor Servicer" shall have the meaning specified in Section
10.02(a).
"Supplement" shall mean, with respect to any Series, a Supplement to
this Agreement, executed and delivered in connection with the original
issuance of the Investor Certificates of such Series pursuant to Section 6.03,
and all amendments thereof and supplements thereto.
"Supplemental Interest" shall have the meaning specified in Section
6.03(c).
"Tax Opinion" shall mean, with respect to any action, an Opinion of
Counsel to the effect that, for Federal income tax purposes, (a) such action
will not adversely affect the tax characterization as debt of Investor
Certificates of any outstanding Series or Class that were characterized as
debt at the time of their issuance, (b) following such action the Trust will
not be deemed to be an association (or publicly traded partnership) taxable as
a corporation and (c) such action will not cause or constitute an event in
which gain or loss would be recognized by any Investor Certificateholders or
the Trust.
"Termination Notice" shall have the meaning specified in Section
10.01.
"Transfer Agent and Registrar" shall have the meaning specified in
Section 6.04.
"Transfer Date" shall mean the Business Day immediately preceding
each Distribution Date.
"Transfer Deposit Amount" shall mean, with respect to any
Distribution Date, the amount, if any, deposited into the Collection Account
on such Distribution Date in connection with the reassignment of an Ineligible
Receivable pursuant to Section 2.05 or 2.07(a) or the reassignment or
assignment of a Receivable pursuant to Section 3.03.
"Transfer Restriction Event" shall have the meaning specified in
Section 2.10.
"Transferors" prior to the Substitution Date shall mean Chase USA
and its predecessors, as Sellers, and on and after the Substitution Date shall
mean LLC and any successors and assigns thereof and any Additional Transferor.
"Transferors' Interest" shall mean, collectively, the Base Interest
and any outstanding Supplemental Interest.
"Transferors' Participation Amount" shall mean at any time of
determination an amount equal to the total amount of Principal Receivables and
the principal amount on deposit in
18
the Special Funding Account and any Principal Funding Account (as defined in
any Supplement) in the Trust at such time minus the aggregate Invested Amounts
and Enhancement Invested Amounts, if any, for all outstanding Series at such
time.
"Transferred Account" shall have the meaning set forth in the
definition of "Account".
"Trust" shall mean the common law trust created by this Agreement.
"Trust Assets" shall have the meaning specified in Section 2.01.
"Trust Cut-Off Date" shall mean May 31, 1993.
"Trustee" shall mean Bankers Trust Company in its capacity as
trustee on behalf of the Trust, or its successor in interest, or any successor
trustee appointed as herein provided.
"UCC" shall mean the Uniform Commercial Code, as amended
from time to time, as in effect in the applicable jurisdiction.
"Unallocated Principal Collections" shall have the meaning specified
in Section 4.03(c).
"United States" shall mean the United States of America (including
the States and the District of Columbia), its territories, its possessions and
other areas subject to its jurisdiction.
"U.S. Alien" or "United States Alien" shall mean any corporation,
partnership, individual or fiduciary that, as to the United States, and for
United States income tax purposes, is (a) a foreign corporation, (b) a foreign
partnership one or more of the members of which is, as to the United States, a
foreign corporation, a nonresident alien individual or a nonresident alien
fiduciary of a foreign estate or trust, (c) a nonresident alien individual or
(d) a nonresident alien fiduciary of a foreign estate or trust.
"U.S. Person" or "United States person" shall mean a citizen or
resident of the United States, a corporation, partnership or other entity
created or organized in or under the laws of the United States, or an estate
or trust the income of which is subject to United States Federal income
taxation regardless of its source.
"VISA" shall mean VISA U.S.A., Inc.
SECTION 1.02. Other Definitional Provisions. (a) With respect to
any Series, all terms used herein and not otherwise defined herein shall have
meanings ascribed to them in the related Supplement.
(b) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
19
(c) As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
defined in this Agreement or in any such certificate or other document, and
accounting terms partly defined in this Agreement or in any such certificate
or other document to the extent not defined, shall have the respective
meanings given to them under generally accepted accounting principles or
regulatory accounting principles, as applicable, in the United States. To the
extent that the definitions of accounting terms in this Agreement or in any
such certificate or other document are inconsistent with the meanings of such
terms under such generally accepted accounting principles or regulatory
accounting principles, the definitions contained in this Agreement or in any
such certificate or other document shall control.
(d) The agreements, representations and warranties of each of the
Bank, LLC and any Additional Transferor in this Agreement in its capacity as
Transferor shall be deemed to be the agreements, representations and
warranties of the Bank or LLC or any such Additional Transferor, as the case
may be, solely in such capacity and for so long as such entity acts in such
capacity under this Agreement; the agreements, representations and warranties
of the Bank in this Agreement, as Servicer, shall be deemed to be the
agreements, representations and warranties of the Bank solely in such capacity
for so long as the Bank, acts in such capacity under this Agreement.
(e) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement; references to any
Section, Schedule or Exhibit are references to Sections, Schedules and
Exhibits in or to this Agreement unless otherwise specified; and the term
"including" means "including without limitation".
ARTICLE II
CONVEYANCE OF RECEIVABLES
SECTION 2.01. Conveyance of Receivables. By execution of this
Agreement, each of the Transferors does hereby transfer, assign, set over and
otherwise convey to the Trustee all its right, title and interest in, to and
under the Receivables existing (i) at the close of business on the Trust
Cut-Off Date, in the case of Receivables arising in the Initial Accounts owned
by such Transferor, and (ii) on each Additional Cut-Off Date, in the case of
Receivables arising in the Additional Accounts, and in each case thereafter
created from time to time until the termination of the Trust, all moneys due
or to become due and all amounts received with respect thereto and all
proceeds (including "proceeds" as defined in the UCC) thereof and all of such
Transferor's rights, title and interest in and to the portion determined
pursuant to Section 2.07(i) of all Allocated Interchange paid to the Account
Owner. Each Transferor does hereby further transfer, assign, set over and
otherwise convey to the Trustee all of its rights, remedies, powers,
privileges and claims under or with respect to the Receivables Purchase
Agreement (whether arising pursuant to the terms of the Receivables Purchase
Agreement or otherwise available to the Transferor at law or in equity),
including without limitation, the rights of the Transferor to enforce the
Receivables Purchase Agreement and to give or withhold any and all consents,
requests, notices, directions, approvals, extensions or waivers under or with
respect to the
20
Receivable Purchase Agreements to the same extent as the Transferor could but
for the assignment thereof to the Trustee. The property described in the two
preceding sentences, together with all moneys, instruments, investment
property, and other property credited to, carried in, or on deposit in the
Collection Account, the Series Accounts and any Series Enhancement shall
constitute the assets of the Trust (the "Trust Assets"). The foregoing does
not constitute and is not intended to result in the creation or assumption by
the Trust, the Trustee, any Investor Certificateholder or any Series Enhancer
of any obligation of the Servicer, the Transferors, any Account Owner, any
Additional Transferor or any other Person in connection with the Accounts or
the Receivables or under any agreement or instrument relating thereto,
including any obligation to Obligors, merchant banks, merchants clearance
systems, VISA, MasterCard or insurers. Any reference herein to a conveyance,
assignment, or other transfer to or by the Trust shall be construed as, and
shall be deemed to mean, a conveyance, assignment, or other transfer to or by
the Trustee.
Each Transferor agrees to record and file, at its own expense,
financing statements (and continuation statements and amendments when
applicable) with respect to the Receivables now existing and hereafter created
in Accounts owned by such Transferor meeting the requirements of applicable
state law in such manner and in such jurisdictions as are necessary to
perfect, and maintain the perfection of, the sale and assignment of such
Receivables to the Trustee, and to deliver a file stamped copy of each such
financing statement or other evidence of such filing to the Trustee on or
prior to the Substitution Date, in the case of such Receivables arising in the
Accounts, designated as Accounts on or prior to the Substitution Date and (if
any additional filing is necessary) on or prior to each subsequent Addition
Date, in the case of such Receivables arising in Additional Accounts. The
Trustee shall be under no obligation whatsoever to file such financing or
continuation statements or to make any other filing under the UCC in
connection with such sale and assignment.
Each Transferor further agrees, at its own expense, (a) on or prior
to (x) the Substitution Date and (y) each Addition Date thereafter, in the
case of Additional Accounts owned by such Transferor, and (z) the applicable
Removal Date, in the case of Removed Accounts owned by such Transferor, to
indicate in the appropriate computer files that Receivables created in
connection with the Accounts owned by such Transferor (other than Removed
Accounts) have been conveyed to the Trustee pursuant to this Agreement and (b)
on or prior to the applicable Document Delivery Date, to deliver to the
Trustee a computer file or microfiche list containing a true and complete list
of all such Accounts (other than Removed Accounts) specifying for each such
Account, as of the Substitution Date, in the case of the Accounts designated
on or prior to the Substitution Date, and the applicable Additional Cut-Off
Date, in the case of Additional Accounts, its account number, the aggregate
amount outstanding in such Account and the aggregate amount of Principal
Receivables outstanding in such Account. Such file or list, as supplemented
from time to time to reflect Additional Accounts and Removed Accounts, shall
be marked as Schedule I to this Agreement and is hereby incorporated into and
made a part of this Agreement.
The parties hereto intend that each transfer of Receivables and
other property pursuant to this Agreement or any Assignment constitutes a
sale, and not a secured borrowing, for accounting purposes. If, and to the
extent that the transfer is not deemed to be a sale, the applicable Transferor
shall be deemed hereunder to have granted and does hereby grant to the
21
Trustee a first priority perfected security interest in all of its right,
title and interest, whether now owned or hereafter acquired, in, to and under
all of the Trust Assets, and this Agreement constitutes a security agreement
under applicable law.
SECTION 2.02. Acceptance by Trustee; Permitted Trust Activities. (a)
The Trustee hereby acknowledges its acceptance of all right, title and
interest to the property, now existing and hereafter created, conveyed to the
Trustee pursuant to Section 2.01 and declares that it shall maintain such
right, title and interest, upon the trust herein set forth, for the benefit of
all Certificateholders. The Trustee further acknowledges that, on or prior to
the Substitution Date, the Transferors delivered to the Trustee the computer
file or microfiche list described in Section 2.01 relating to the Accounts
designated on or prior to the Substitution Date.
(b) The Trustee hereby agrees not to disclose to any Person any of
the account numbers or other information contained in the computer files or
microfiche lists marked as Schedule 1 or otherwise delivered to the Trustee
from time to time, except (i) to a Successor Servicer or as required by a
Requirement of Law applicable to the Trustee, (ii) in connection with the
performance of the Trustee's duties hereunder or (iii) in enforcing the rights
of Certificateholders. The Trustee agrees to take such measures as shall be
reasonably requested by the Account Owner and the Transferors to protect and
maintain the security and confidentiality of such information and, in
connection therewith, will allow the Bank or the Transferors to inspect the
Trustee's security and confidentiality arrangements from time to time during
normal business hours. The Trustee shall use its best efforts to provide the
Account Owner and the Transferors with notice five Business Days prior to any
disclosure pursuant to this Section.
(c) The Trustee shall have no power to create, assume or incur
indebtedness or other liabilities in the name of the Trust other than as
contemplated in this Agreement or any Supplement.
(d) The Trustee hereby agrees not to use any information it obtains
pursuant to this Agreement, including any of the account numbers or other
information contained in the computer files or microfiche lists marked as
Schedule 1 or otherwise delivered by the Account Owner or the Transferors to
the Trustee pursuant to Sections 2.01, 2.08, 2.09 or 3.04(c), to compete or
assist any person in competing with the Account Owner or the Transferors in
their businesses.
(e) The purpose of the Trust is to engage in the following
activities:
(i) to accept, acquire and hold, for the benefit of the
Certificateholders or any other owners of beneficial interests in the
Trust or its assets, (a) Trust Assets and all proceeds thereof, (b)
Participation Interests and Series Enhancement, (c) servicing rights with
respect to financial assets it holds, and (d) passive derivative
financial instruments that pertain to beneficial interests issued or sold
to Investor Certificateholders of one or more Series (excluding any
Investor Certificates issued or sold to the Transferors or any Affiliate
or agent of the Transferors), and passive derivative financial
instruments replacing any such instrument that has expired or as to which
the obligor has defaulted or been downgraded, provided that all such
assets held by the Trust do not
22
involve the Trustee in the making of decisions other than those inherent
in servicing or administering the Trust;
(ii) to issue Series of Investor Certificates and to issue the
Transferors' Interest, Supplemental Interests and other beneficial
interests in the Trust and its assets from time to time pursuant to this
Agreement and related Supplements;
(iii) to service, administer, collect, protect, invest and
distribute the assets of the Trust and the proceeds thereof;
(iv) to make distributions and payments to Investor
Certificateholders, to the holders of the Transferors' Interest and any
Supplemental Interests, to providers of Series Enhancement and derivative
financial instruments and to other owners of beneficial interests in the
Trust;
(v) to service or provide for the servicing of the assets of the
Trust and to pay Servicing Fees as provided in this Agreement and the
related Supplements, to pay Trustee's fees and expenses and other fees
and expenses as provided in this Agreement and the related Supplements
and other agreements entered into in connection with the servicing,
administration and operation of the Trust and the assets of the Trust;
(vi) to transfer, assign and otherwise convey any portion of the
Trust Assets released from the Trust; and
(vii) to engage in those activities, including entering into,
executing, delivering and performing agreements, certificates,
instruments, reports, notices, filings and other documents described in
this Agreement and the related Supplements or that are necessary,
suitable or convenient to accomplish the foregoing or are incidental to
the foregoing or are connected therewith;
provided that the foregoing activities are not contrary to the status of the
Trust as a qualified special purpose entity under existing accounting
literature.
The Trust shall not engage in any activity other than in connection
with the foregoing or other than as required or authorized by the terms of
this Agreement and the related Supplements and other related agreements,
certificates, instruments and documents.
SECTION 2.03. Representations and Warranties of the Transferors
Relating to the Transferors. Each of the Transferors hereby severally
represents and warrants to the Trust on behalf of itself only and not as to
any other Transferor and only for so long as it is a Transferor, that as of
each Closing Date and as of the Substitution Date:
(a) Organization and Good Standing. Such Transferor is a limited
liability company duly formed, validly existing in good standing under the
laws of the state of Delaware, and the Transferor has full power, authority
and legal right to own its properties and conduct its consumer revolving
lending business or its receivables purchase and transfer business as such
properties are presently owned and such business is presently conducted, to
execute, deliver and perform its obligations under the Receivables Purchase
Agreement and each Assignment
23
thereunder and under this Agreement and each Supplement and to execute and
deliver to the Trustee the Certificates pursuant hereto.
(b) Due Qualification. Such Transferor is duly qualified to do
business and is in good standing as a foreign corporation (or is exempt from
such requirements), and has obtained all necessary licenses and approvals with
respect to such Transferor, in each jurisdiction in which failure to so
qualify or to obtain such licenses and approvals would render any Lending
Agreement relating to any Account or any Receivable transferred to the Trustee
by such Transferor unenforceable by such Transferor, the Servicer or the
Trustee or would have a material adverse effect on the interests of the
Certificateholders hereunder or under any Supplement and the Account Owner is
duly qualified to do business and is in good standing as a foreign corporation
(or is exempt from such requirements), and has obtained all necessary licenses
and approvals with respect to the Account Owner, in each jurisdiction in which
failure to so qualify or to obtain such licenses and approvals would render
any Lending Agreement relating to any Account or any Receivables transferred
to the Transferor unenforceable by the Account Owner, the Transferor, the
Servicer or the Trustee or would have a material adverse effect on the
interests of the Certificateholders hereunder or under any Supplement.
(c) Due Authorization. The execution, delivery and performance of
this Agreement and each Supplement by such Transferor, the execution and
delivery to the Trustee of the Certificates by such Transferor and the
consummation by such Transferor of the transactions provided for in this
Agreement and each Supplement have been duly authorized by such Transferor by
all necessary corporate action on the part of such Transferor and this
Agreement and each Supplement will remain, from the time of its execution, an
official record of such Transferor.
(d) No Conflict. The execution and delivery by such Transferor of
this Agreement, each Supplement and the Certificates, the performance by such
Transferor of the transactions contemplated by this Agreement and each
Supplement and the fulfillment by such Transferor of the terms hereof and
thereof will not conflict with, result in any breach of any of the material
terms and provisions of, or constitute (with or without notice or lapse of
time or both) a material default under, any indenture, contract, agreement,
mortgage, deed of trust, or other instrument to which such Transferor is a
party or by which it or any of its properties are bound.
(e) No Violation. The execution and delivery by such Transferor of
this Agreement, each Supplement and the Certificates, the performance by such
Transferor of the transactions contemplated by this Agreement and each
Supplement and the fulfillment by such Transferor of the terms hereof and
thereof will not conflict with or violate any Requirements of Law applicable
to such Transferor.
(f) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of such Transferor, threatened against such
Transferor, before any court, regulatory body, administrative agency, or other
tribunal or governmental instrumentality (i) asserting the invalidity of this
Agreement, the Receivables Purchase Agreement, any Supplement or the
Certificates, (ii) seeking to prevent the issuance of the Certificates or the
consummation of any of the transactions contemplated by this Agreement, the
Receivables Purchase Agreement,
24
any Supplement or the Certificates, (iii) seeking any determination or ruling
that, in the reasonable judgment of such Transferor, would materially and
adversely affect the performance by such Transferor of its obligations under
this Agreement, the Receivables Purchase Agreement, or any Supplement, (iv)
seeking any determination or ruling that would materially and adversely affect
the validity or enforceability of this Agreement, the Receivables Purchase
Agreement, any Supplement or the Certificates or (v) seeking to affect
adversely the income tax attributes of the Trust.
(g) All Consents Required. All approvals, authorizations, consents,
orders or other actions of any Person or of any governmental body or official
required in connection with the execution and delivery by such Transferor of
this Agreement, the Receivables Purchase Agreement, each Supplement and the
Certificates, the performance by such Transferor of the transactions
contemplated by this Agreement, the Receivables Purchase Agreement, and each
Supplement and the fulfillment by such Transferor of the terms hereof and
thereof, have been obtained; provided, however, that such Transferor makes no
representation or warranty regarding state securities or "blue sky" laws in
connection with the distribution of the Certificates.
(h) Insolvency. No Insolvency Event with respect to such Transferor
has occurred and the transfer of the Receivables by such Transferor to the
Trust has not been made in contemplation of the occurrence thereof.
The representations and warranties of each Transferor set forth in
this Section 2.03 shall survive the transfer and assignment by such Transferor
of the respective Receivables to the Trustee. Upon discovery by such
Transferor, the Servicer or the Trustee of a breach of any of the
representations and warranties by such Transferor set forth in this Section
2.03, the party discovering such breach shall give prompt written notice to
the others and to each Series Enhancer entitled thereto pursuant to the
relevant Supplement. Such Transferor agrees to cooperate with the Servicer and
the Trustee in attempting to cure any such breach. For purposes of the
representations and warranties set forth in this Section 2.03, each reference
to a Supplement or Certificates shall be deemed to refer only to those
Supplements or Certificates in effect as of the Substitution Date and the
relevant Closing Date that were executed and delivered by such Transferor.
SECTION 2.04. Representations and Warranties of the Transferors
Relating to the Agreement and Any Supplement and the Receivables.
(a) Representations and Warranties. Each of the Transferors hereby
severally represents and warrants, as to itself only and not as to any other
Transferor, to the Trustee as of the Substitution Date and the date of each
Supplement, as of each Closing Date and with respect to Additional Accounts
the Receivables in which are being transferred by such Transferor to the
Trustee, as of the related Addition Date that:
(i) the Receivables Purchase Agreement, this Agreement, each
Supplement and, in the case of Additional Accounts the Receivables in
which are being transferred by such Transferor to the Trustee, the
related Assignment, each constitutes a legal, valid and binding
obligation of such Transferor enforceable against such Transferor in
accordance with its terms, except as such enforceability may be limited
by applicable
25
Bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect affecting the enforcement of creditors' rights
in general and except as such enforceability may be limited by general
principles of equity (whether considered in a suit at law or in equity);
(ii) as of the first Closing Date, and as of the related Addition
Date with respect to Additional Accounts the Receivables in which are
being transferred by such Transferor to the Trustee, Schedule I to this
Agreement, as supplemented to such date, is an accurate and complete
listing in all material respects of all the Accounts owned or designated
by such Transferor as of the Trust Cut-Off Date or such Additional
Cut-Off Date, as the case may be, and the information contained therein
with respect to the identity of such Accounts and the Receivables
existing in such Accounts is true and correct in all material respects as
of the Trust Cut-Off Date or such Additional Cut-Off Date, as the case
may be;
(iii) each Receivable conveyed to the Trustee by such Transferor has
been conveyed to the Trustee free and clear of any Lien of any Person
claiming through or under such Transferor or any of its Affiliates or the
Account Owner (other than Liens permitted under subsection 2.07(b)) and
in compliance, in all material respects, with all Requirements of Law
applicable to such Transferor;
(iv) all authorizations, consents, orders or approvals of or
registrations or declarations with any Governmental Authority required to
be obtained, effected or given by the Account Owner in connection with
the conveyance by the Account Owner under the Receivables Purchase
Agreement or by such Transferor in connection with the conveyance by such
Transferor of Receivables to the Trustee have been duly obtained,
effected or given and are in full force and effect;
(v) either this Agreement or, in the case of Additional Accounts,
the related Assignment constitutes a valid sale, transfer and assignment
to the Trustee of all right, title and interest of such Transferor in the
Receivables conveyed to the Trustee by such Transferor and the proceeds
thereof or, if this Agreement or, in the case of Additional Accounts, the
related Assignment does not constitute a sale of such property, it
constitutes a grant of a security interest in such property to the
Trustee, which, in the case of existing Receivables and the proceeds
thereof, is enforceable upon execution and delivery of this Agreement,
or, with respect to then existing Receivables in Additional Accounts, as
of the applicable Addition Date, and which will be enforceable with
respect to such Receivables hereafter and thereafter created and the
proceeds thereof upon such creation. Upon the filing of the financing
statements pursuant to Section 2.01 and, in the case of Receivables
hereafter created and the proceeds thereof, upon the creation thereof,
the Trustee shall have a first priority perfected security or ownership
interest in such property and proceeds except for Liens permitted under
subsection 2.07(b); provided, however, that such security interest in
proceeds is perfected only to the extent provided in Section 9-315 of the
UCC;
(vi) except as otherwise expressly provided in this Agreement or any
Supplement, neither such Transferor nor any Person claiming through or
under such
26
Transferor has any claim to or interest in the Collection Account, any
Series Account or any Series Enhancement;
(vii) on the Trust Cut-Off Date, each Initial Account was an
Eligible Account and, on the applicable Addition Date, each related
Additional Account is an Eligible Account;
(viii) on the Trust Cut-Off Date, each Receivable then existing in
an Account is an Eligible Receivable and, on the applicable Addition
Date, each Receivable contained in any related Additional Accounts
transferred to the Trustee by such Transferor is an Eligible Receivable;
(ix) as of the date of the creation of any new Receivable in an
Account such Receivable is an Eligible Receivable; and
(x) no selection procedure has been utilized by the Account Owner or
such Transferor which such Transferor reasonably believes would result in
a selection of Initial Accounts (from among the available Eligible
Accounts owned by the Account Owner on the Trust Cut-Off Date) that would
be materially adverse to the interests of the Investor
Certificateholders.
(b) Representations and Warranties of the Transferors Relating to
Security Interest. Each Transferor hereby makes the following representations
and warranties with respect to Receivables transferred by it, and each of the
following representations and warranties shall survive until the termination
of this Agreement and each shall speak as of the Substitution Date and, with
respect to Receivables in Additional Accounts, as of the Addition Date. None
of the following representations and warranties shall be waived by any of the
parties to this Agreement unless the Rating Agency Condition shall have been
satisfied with respect to such waiver.
(i) This Agreement creates a valid and continuing security interest
(as defined in the applicable UCC) in favor of the Trustee in the
Receivables, which security interest is prior to all other liens, and is
enforceable as such against creditors of and purchasers from the
Transferor.
(ii) The Receivables transferred by such Transferor constitute
"accounts" within the meaning of the applicable UCC.
(iii) At the time of its transfer of any item of collateral to the
Trustee pursuant to this Agreement, such Transferor owned and had good
and marketable title to such item of collateral free and clear of any
lien, claim or encumbrance of any Person.
(iv) Such Transferor has caused or will have caused, within ten (10)
days of the Substitution Date, the filing of all appropriate financing
statements in the proper filing office in the appropriate jurisdictions
under applicable law in order to perfect the security interest in the
Receivables granted to the Trustee pursuant to this Agreement.
27
(v) Other than the security interest granted to the Trustee pursuant
to this Agreement or an Assignment, such Transferor has not pledged,
assigned, sold, granted a security interest in, or otherwise conveyed the
Receivables described in Section 2.01 of this Agreement. Such Transferor
has not authorized the filing of and is not aware of any financing
statements against the Transferor that include a description of the
Receivables other than any financing statement relating to the transfer
of the Receivables to the Transferor pursuant to the appropriate
Receivables Purchase Agreement and the security interest granted to the
Trustee pursuant to this Agreement or an Assignment or that has been
terminated. Such Transferor is not aware of any judgment or tax lien
filings against such Transferor.
(c) Notice of Breach. The representations and warranties of each
Transferor set forth in this Section 2.04 shall survive the transfer and
assignment by such Transferor of Receivables to the Trustee. Upon discovery by
such Transferor, the Servicer or the Trustee of a breach of any of the
representations and warranties by such Transferor set forth in this Section
2.04, the party discovering such breach shall give prompt written notice to
the others and to each Series Enhancer entitled thereto pursuant to the
relevant Supplement. Such Transferor agrees to cooperate with the Servicer and
the Trustee in attempting to cure any such breach. For purposes of the
representations and warranties set forth in this Section 2.04, each reference
to a Supplement shall be deemed to refer only to those Supplements in effect
as of the date of the relevant representations or warranties.
SECTION 2.05. Reassignment of Ineligible Receivables. (a)
Reassignment of Receivables. In the event (i) any representation or warranty
of a Transferor contained in Section 2.04(a)(ii), (iii), (iv), (vii), (viii),
(ix) or (x) is not true and correct in any material respect as of the date
specified therein with respect to any Receivable transferred to the Trustee by
such Transferor or an Account owned by such Transferor and as a result of such
breach any Receivables in the related Account become Defaulted Receivables or
the Trustee's rights in, to or under such Receivables or the proceeds of such
Receivables are impaired or such proceeds are not available for any reason to
the Trustee free and clear of any Lien, unless cured within 60 days (or such
longer period, not in excess of 150 days, as may be agreed to by the Trustee)
after the earlier to occur of the discovery thereof by such Transferor or
receipt by such Transferor of notice thereof given by the Trustee (and as soon
as practicable after such discovery or receipt of notice such Transferor shall
endeavor to exclude the aggregate of the Receivables of the related Accounts
from the aggregate of the Receivables in the Trust), or (ii) it is so provided
in Section 2.07(a) with respect to any Receivables transferred to the Trustee
by such Transferor, then such Transferor shall accept reassignment of all
Receivables in the related Account ("Ineligible Receivables") on the terms and
conditions set forth in paragraph (b) below; provided, however, that such
Receivables will not be deemed to be Ineligible Receivables and will not be
reassigned to such Transferor if, on any day prior to the end of such 60-day
or longer period, (x) either (A) in the case of an event described in clause
(i) above the relevant representation and warranty shall be true and correct
in all material respects as if made on such day or (B) in the case of an event
described in clause (ii) above the circumstances causing such Receivable to
become an Ineligible Receivable shall no longer exist and (y) such Transferor
shall have delivered to the Trustee a certificate of an authorized officer
describing the nature of such breach and the manner in which the relevant
representation and warranty became true and correct.
28
(b) Price of Reassignment. The Servicer shall deduct the portion of
the Ineligible Receivables reassigned to a Transferor which are Principal
Receivables from the aggregate amount of Principal Receivables used to
calculate the Transferors' Participation Amount, the Transferors' Interest and
the Floating Allocation Percentage and the Principal Allocation Percentage
applicable to any Series. In the event that, following the exclusion of such
Principal Receivables from the calculation of the Transferors' Participation
Amount, the Transferors' Participation Amount would be a negative number, not
later than 12:00 noon, New York City time, on the first Distribution Date
following the Monthly Period in which such reassignment obligation arises, the
relevant Transferor shall make a deposit into the Collection Account in
immediately available funds in an amount equal to the amount by which the
Transferors' Participation Amount would be below zero (up to the amount of
such Principal Receivables). Any amount deposited into the Collection Account
in connection with the reassignment of an Ineligible Receivable shall be
considered a Transfer Deposit Amount and shall be applied in accordance with
Article IV and the terms of each Supplement.
Upon the deposit, if any, required to be made to the Collection
Account as provided in this Section and the reassignment of Ineligible
Receivables, the Trustee shall automatically and without further action sell,
transfer, assign, set over and otherwise convey to the relevant Transferor,
without recourse, representation or warranty, all the right, title and
interest of the Trustee in and to such Ineligible Receivables, all moneys due
or to become due and all amounts received with respect thereto and all
proceeds thereof. The Trustee shall execute such documents and instruments of
transfer or assignment and take such other actions as shall reasonably be
requested by the relevant Transferor to effect the conveyance of Ineligible
Receivables pursuant to this Section. The obligation of a Transferor to accept
reassignment of any Ineligible Receivables, and to make the deposits, if any,
required to be made to the Collection Account as provided in this Section,
shall constitute the sole remedy respecting the event giving rise to such
obligation available to Certificateholders (or the Trustee on behalf of the
Certificateholders) or any Series Enhancer.
For purposes of subsection 2.05(a) above, proceeds of a Receivable
shall not be deemed to be impaired hereunder solely because such proceeds are
held by the Servicer (if the Bank is the Servicer) for more than the
applicable period under Section 9-315(d) of the UCC.
SECTION 2.06. Reassignment of Receivables in Trust Portfolio. In
the event any representation or warranty of a Transferor set forth in Section
2.03(a) or (c) or Section 2.04(a)(i), (v) or (vi) is not true and correct in
any material respect and such breach has a material adverse effect on the
Certificateholders' Interest in the Receivables transferred to the Trustee by
such Transferor, then either the Trustee or the Holders of Investor
Certificates evidencing not less than 50% of the aggregate unpaid principal
amount of all outstanding Investor Certificates, by notice then given to such
Transferor and the Servicer (and to the Trustee if given by the Investor
Certificateholders), may direct such Transferor to accept a reassignment of
the Receivables transferred to the Trust by such Transferor if such breach and
any material adverse effect caused by such breach is not cured within 60 days
of such notice (or within such longer period, not in excess of 150 days, as
may be specified in such notice), and upon those conditions such Transferor
shall be obligated to accept such reassignment on the terms set forth below;
provided, however, that such Receivables will not be reassigned to such
Transferor if, on any day prior to the end of such 60-day or longer period (i)
the relevant representation and
29
warranty shall be true and correct in all material respects as if made on such
day and (ii) such Transferor shall have delivered to the Trustee a certificate
of an authorized officer describing the nature of such breach and the manner
in which the relevant representation and warranty became true and correct.
The relevant Transferor shall deposit in the Collection Account in
immediately available funds not later than 12:00 noon, New York City time, on
the first Distribution Date following the Monthly Period in which such
reassignment obligation arises, in payment for such reassignment, an amount
equal to the sum of the amounts specified therefor with respect to each
outstanding Series in the related Supplement. Notwithstanding anything to the
contrary in this Agreement, such amounts shall be distributed on such
Distribution Date in accordance with Article IV and the terms of each
Supplement.
Upon the deposit, if any, required to be made to the Collection
Account as provided in this Section and the reassignment of the applicable
Receivables, the Trustee shall automatically and without further action sell,
transfer, assign, set over and otherwise convey to the relevant Transferor or
its designee, without recourse, representation or warranty, all the right,
title and interest of the Trustee in and to such Receivables, all moneys due
or to become due and all amounts received with respect thereto and all
proceeds thereof. The Trustee shall execute such documents and instruments of
transfer or assignment and take such other actions as shall reasonably be
requested by the relevant Transferor to effect the conveyance of such
Receivables pursuant to this Section. The obligation of a Transferor to accept
reassignment of any Receivables, and to make the deposits, if any, required to
be made to the Collection Account as provided in this Section, shall
constitute the sole remedy respecting the event giving rise to such obligation
available to Certificateholders (or the Trustee) or any Series Enhancer.
SECTION 2.07. Covenants of the Transferors. Each Transferor hereby
covenants as follows as to itself only and not as to any other Transferor:
(a) Receivables To Be Accounts. Except in connection with the
enforcement or collection of an Account, such Transferor will take no action
to cause or permit the Account Owner to take any action to cause any
Receivable transferred by it to the Trustee to be evidenced as a result of the
Transferor's action, by any instrument or chattel paper (as defined in the
UCC).
(b) Security Interests. Except for the conveyances hereunder, such
Transferor will not sell, pledge, assign or transfer to any other Person, or
grant, create, incur, assume or suffer to exist any Lien on any Receivable
transferred by it to the Trustee, whether now existing or hereafter created,
or any interest therein; such Transferor will immediately notify the Trustee
of the existence of any Lien on any such Receivable; and such Transferor shall
defend the right, title and interest of the Trustee in, to and under such
Receivables, whether now existing or hereafter created, against all claims of
third parties claiming through or under such Transferor; provided, however,
that nothing in this subsection 2.07(b) shall prevent or be deemed to prohibit
such Transferor from suffering to exist upon any of the Receivables
transferred by it to the Trustee any Liens for municipal or other local taxes
if such taxes shall not at the time be due and payable or if such Transferor
or the Account Owner shall currently be contesting the validity thereof in
good faith by appropriate proceedings and shall have set aside on its books
adequate reserves with respect thereto.
30
(c) Transferors' Interest. Except for the conveyances hereunder, in
connection with any transaction permitted by Section 7.02 and as provided in
Sections 2.08(f) and 6.03, such Transferor agrees not to transfer, assign,
exchange or otherwise convey or pledge, hypothecate or otherwise grant a
security interest in the Transferors' Interest and any such attempted
transfer, assignment, exchange, conveyance, pledge, hypothecation or grant
shall be void.
(d) Delivery of Collections. In the event that such Transferor
receives Collections (other than Interchange to be included as Collections of
Finance Charge Receivables pursuant to Section 2.07(i)), such Transferor
agrees to pay the Servicer all such Collections as soon as practicable after
receipt thereof but in no event later than two Business Days after the Date of
Processing by the Transferor.
(e) Notice of Liens. Such Transferor shall notify the Trustee and
each Series Enhancer entitled to such notice pursuant to the relevant
Supplement promptly after becoming aware of any Lien on any Receivable other
than the conveyances hereunder or Liens permitted under Section 2.07(b).
(f) Periodic Finance Charges and Other Fees. Such Transferor hereby
agrees that it will include in each Receivables Purchase Agreement provisions
under which the Account Owner will agree that except as otherwise required by
any Requirement of Law, or as is deemed by the Account Owner in its sole
discretion to be necessary in order for the Account Owner to maintain its
lending business on a competitive basis based on a good faith assessment by
the Account Owner of the nature of its competition in the lending business, it
shall not at any time reduce the annual percentage rate of the Periodic
Finance Charges assessed on the Receivables transferred by it to such
Transferor or other fees charged on any of the Accounts owned by it if, as a
result of any such reduction, either (i) such Account Owner's reasonable
expectation is that such reduction will cause a Pay Out Event to occur or (ii)
such reduction is not also applied to any comparable segment of consumer
revolving accounts owned by the Account Owner which have characteristics the
same as, or substantially similar to, such Accounts.
(g) Lending Agreements and Guidelines. Such Transferor shall include
in the Receivables Purchase Agreement a covenant by the Account Owner to
comply with and perform its obligations under the Lending Agreements relating
to the Accounts owned by it and the Lending Guidelines and all applicable
rules and regulations of MasterCard and VISA or their respective substantial
equivalents except insofar as any failure so to comply or perform would not
materially and adversely affect the ability of the Account Owner to comply
with its obligations under the Receivables Purchase Agreement or the ability
of such Transferor to comply with its obligations under this Agreement. The
Receivables Purchase Agreement may, however, permit the Account Owner, subject
to compliance with all Requirements of Law, to change the terms and provisions
of the Lending Agreements or the Lending Guidelines with respect to any of the
Accounts owned by it in any respect (including the calculation of the amount,
or the timing, of charge-offs and the Periodic Finance Charges and other fees
to be assessed thereon) only if in the reasonable judgment of the Account
Owner such change is made applicable to any comparable segment of the consumer
revolving accounts owned by the Account Owner which have characteristics the
same as, or substantially similar to, such Accounts.
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(h) MasterCard and VISA. Such Transferor shall include in the
Receivables Purchase Agreement a covenant by the Account Owner to use its best
efforts to remain, either directly or indirectly, a member in good standing of
the MasterCard System, the VISA System and any other similar entity's or
organization's system relating to any other type of revolving credit card
accounts included as Accounts.
(i) Interchange. On or prior to each Determination Date such
Transferor shall notify the Servicer (or notify another Transferor if such
other Transferor is notifying the Servicer on behalf of all Transferors) of
the amount of the Allocated Interchange received by the Transferor under the
Receivables Purchase Agreement and such Allocated Interchange shall be
included as Collections of Finance Charge Receivables with respect to the
preceding Monthly Period.
(j) Limited Liability Agreement. The Transferor will not engage in
any activity or incur any indebtedness or other material liability other than
as contemplated or permitted pursuant to Section 7 and Section 9(j) of the
Limited Liability Company Agreement or this Agreement. The Transferor will not
amend or modify the Limited Liability Company Agreement unless the Rating
Agency Condition is satisfied with respect thereto.
SECTION 2.08. Addition of Accounts. (a) Required Additions. (i)
If, as of the close of business on the last Business Day of any Monthly
Period, either (A) the Transferors' Participation Amount is less than the
Required Transferors' Participation Amount on such date or (B) the aggregate
amount of Principal Receivables is less than the Required Principal Balance on
such date, the Transferors shall on or prior to the close of business on the
10th Business Day following the last Business Day of such Monthly Period (the
"Required Designation Date"), unless the Transferors' Participation Amount
exceeds the Required Transferors' Participation Amount or the aggregate amount
of Principal Receivables exceeds the Required Principal Balance, as the case
may be, in either case as of the close of business on any day after the last
Business Day of such Monthly Period and prior to the Required Designation
Date, designate additional Eligible Accounts to be included as Accounts as of
the Required Designation Date or any earlier date in a sufficient amount such
that, after giving effect to such addition, the Transferors' Participation
Amount as of the close of business on the Addition Date is at least equal to
the Required Transferors' Participation Amount on such date and the aggregate
amount of Principal Receivables equals or exceeds the Required Principal
Balance on such date. The failure of any condition set forth in paragraph (c)
or (d) below, as the case may be, shall not relieve the Transferors of their
obligation pursuant to this paragraph; provided, however, that the failure of
the Transferors to transfer Receivables to the Trustee as provided in this
paragraph solely as a result of the unavailability of a sufficient amount of
Eligible Receivables shall not constitute a breach of this Agreement; provided
further that any such failure which has not been timely cured will
nevertheless result in the occurrence of Pay Out Event described in Section
9.01(d) with respect to each outstanding Series.
(ii) In lieu of, or in addition to, designating Additional Accounts
pursuant to clause (i) above, the Transferors may, subject to the
conditions specified in paragraph (d) below, convey to the Trustee
participations representing undivided interests in a pool of assets
primarily consisting of revolving credit card accounts or other revolving
credit accounts owned by an Account Owner and collections thereon
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("Participation Interests"). The addition of Participation Interests in
the Trust pursuant to this paragraph (a) or paragraph (b) below shall be
effected by an amendment hereto, dated the applicable Addition Date,
pursuant to Section 13.01(a).
(b) Permitted Additions. Each Transferor may from time to time, at
its sole discretion, subject to the conditions specified in paragraph (c) or
(d) below, as the case may be, designate additional Eligible Accounts to be
included as Accounts or Participation Interests to be included as Trust
Assets, in either case as of the applicable Additional Cut-Off Date.
(c) Automatic Additional Accounts. (i) Each Transferor may from time
to time, at its sole discretion, subject to and in compliance with the
limitations specified in clause (ii) below and the applicable conditions
specified in paragraph (d) below, designate Eligible Accounts to be included
as Accounts as of the applicable Additional Cut-Off Date. For purposes of this
paragraph, Eligible Accounts shall include only revolving credit card accounts
or other revolving credit accounts which are (x) originated by an Account
Owner and (y) of a type included as Initial Accounts or which have previously
been included in any Addition which has been effected in accordance with all
of the conditions specified in paragraph (d) below.
(ii) The Transferors shall not be permitted to designate Automatic
Additional Accounts pursuant to clause (i) above with respect to any of
the three consecutive Monthly Periods commencing in January, April, July
and October of each calendar year, commencing in July 1993, unless on or
before the first Business Day of such three consecutive Monthly Periods,
the Transferors shall have requested each Rating Agency to notify, and
each Rating Agency shall have notified, the Transferors, the Servicer and
the Trustee of the limitations (other than the limitations described in
this Agreement), if any, to the right of the Transferors to designate
Automatic Additional Accounts during such three consecutive Monthly
Periods. Following the Addition of any such Automatic Additional Accounts
and any Required Additions made pursuant to Section 2.08(a), the Servicer
shall provide information to Moody's with respect to such Additional
Accounts not later than the last Business Day of the month following the
quarter period in which such Addition occurs in the form approved from
time to time by Moody's and the Servicer. Unless each Rating Agency
otherwise consents, the number of Automatic Additional Accounts plus the
number of Accounts added pursuant to Section 2.08(a), without the prior
Rating Agency notice described under Section 2.08(d)(v), shall not at any
time exceed the Aggregate Addition Limit.
(iii) On or before each Distribution Date, the Transferors shall
have delivered to the Trustee, the Rating Agency and any Series Enhancer
entitled thereto pursuant to the relevant Supplement an opinion of
Counsel in accordance with Section 13.02(d), with respect to the
Automatic Additional Accounts included as Accounts during the preceding
Monthly Period confirming the validity and perfection of each transfer of
the Receivables in such Automatic Additional Accounts. For purposes of
this subsection such Opinion of Counsel shall be provided by in-house or
outside counsel of the Transferors except that if such opinion is
delivered by in-house counsel, an Opinion shall be provided by outside
counsel with respect to the Automatic Additional Accounts included as
Accounts during each of the three consecutive Monthly Periods commencing
in January, April, July and October of each calendar year commencing in
July 1993;
33
provided, however, if the Transferors are not wholly owned (directly or
indirectly) subsidiaries of a company with a long-term unsecured debt
rating of A or better by Standard & Poor's, such Opinion of Counsel shall
be provided by outside counsel of the Transferors with respect to the
Automatic Additional Accounts included as Accounts during the preceding
Monthly Period. If such Opinion of Counsel with respect to any Automatic
Additional Accounts is not so received, the ability of the Transferors to
designate Automatic Additional Accounts will be suspended until such time
as the Rating Agency otherwise consents in writing. If the Transferors
are unable to deliver an Opinion of Counsel with respect to any
Additional Account which has been the subject of an Automatic Addition,
such inability shall be deemed to be a breach of the representation in
Section 2.04(a)(viii) with respect to the Receivables in such Additional
Account for purposes of Section 2.05.
(d) Conditions to Addition. On the Addition Date with respect to any
Additional Accounts or Participation Interests, the Trustee shall acquire the
Receivables in such Additional Accounts (and such Additional Accounts shall be
deemed to be Accounts for purposes of this Agreement) or shall acquire such
Participation Interests, in each case as of the close of business on the
applicable Additional Cut-Off Date, subject to the satisfaction of the
following conditions (provided, however, that the conditions set forth in
clauses (i), (v), (vi) and (vii) shall not apply to the transfer to the
Trustee of Receivables in Automatic Additional Accounts which are governed by
Section 2.08(c)):
(i) on or before the tenth Business Day immediately preceding the
Addition Date, each Transferor which is designating any such Additional
Account or is transferring any such Participation Interest to the Trust
(a "Participating Transferor") shall have given the Trustee, the
Servicer, each Rating Agency and any Series Enhancer entitled thereto
pursuant to the relevant Supplement written notice that the Additional
Accounts or Participation Interests will be included and specifying the
applicable Addition Date, the Additional Cut-Off Date, the approximate
number of accounts expected to be added and the approximate aggregate
balances expected to be outstanding in the accounts to be added;
(ii) in the case of Additional Accounts, the Participating
Transferors shall have delivered to the Trustee copies of UCC-1 financing
statements covering such Additional Accounts, if necessary to perfect the
Trustee's interest in the Receivables arising therein;
(iii) in the case of Additional Accounts, to the extent required by
Section 4.03, the Participating Transferors shall have deposited or
caused to be deposited in the Collection Account all Collections (other
than Interchange to be included as Collections of Finance Charge
Receivables pursuant to Section 2.07(i)) with respect to such Additional
Accounts since the Additional Cut-Off Date;
(iv) as of each of the Additional Cut-Off Date and the Addition
Date, no Insolvency Event with respect to the Participating Transferor or
the Account Owner shall have occurred nor shall the transfer of the
Receivables arising in the Additional
34
Accounts or of the Participation Interests to the Transferor or to the
Trustee have been made in contemplation of the occurrence thereof;
(v) except in the case of an Addition pursuant to Section 2.08(a),
the Rating Agency Condition shall have been satisfied and in the case of
an Addition pursuant to Section 2.08(a) which would exceed the Aggregate
Addition Limit, the Transferors shall have provided to each Rating Agency
at least 15 days prior written notice of such Addition and at or prior to
the end of such 15-day period, the Transferor shall not have received a
notice in writing from a Rating Agency, that such Addition will result in
the lowering or withdrawal of its then existing rating of the Investor
Certificates of any Series;
(vi) each Participating Transferor shall have delivered to the
Trustee and any Series Enhancer entitled thereto pursuant to the relevant
Supplement an Officer's Certificate, dated the Addition Date, stating
that (x) in the case of Additional Accounts, as of the applicable
Addition Date the Additional Accounts are all Eligible Accounts, (y) to
the extent applicable, the conditions set forth in clauses (ii) through
(v) above have been satisfied and (z) such Participating Transferor
reasonably believes that (A) the transfer by such Participating
Transferor of the Receivables arising in the Additional Accounts or of
the Participation Interests to the Trustee will not, based on the facts
known to such officer at the time of such certification, then or
thereafter cause a Pay Out Event to occur with respect to any Series and
(B) in the case of Additional Accounts, no selection procedure was
utilized by the Account Owner or by such Participating Transferor which
would result in a selection of Additional Accounts (from among the
available Eligible Accounts owned by such Participating Transferor) that
would be materially adverse to the interests of the Investor
Certificateholders of any Series as of the Addition Date; and
(vii) the Participating Transferors shall have delivered to the
Trustee, each Rating Agency and any Series Enhancer entitled thereto
pursuant to the relevant Supplement an Opinion of Counsel, dated the
Addition Date, in accordance with Section 13.02(d).
(e) Representations and Warranties. Each of the Participating
Transferors hereby severally represents and warrants to the Trust as of the
related Addition Date as to the matters relating to it set forth in paragraph
(d)(iv) and (vi) above and that, in the case of Additional Accounts designated
by it, the file or list delivered pursuant to paragraph (g) below is, as of
the applicable Additional Cut-Off Date, true and complete in all material
respects.
(f) Additional Transferors. LLC may designate Affiliates of LLC to
be included as Transferors and, as such, Holders of an interest in the
Transferors' Interest ("Additional Transferors") under this Agreement by an
amendment hereto pursuant to Section 13.01(a); provided, however, that prior
to any such designation (i) the conditions set forth in Section 6.03(c) or
6.03(d), as applicable, shall have been satisfied with respect thereto and
(ii) the Rating Agency Condition is satisfied with respect thereto.
35
(g) Delivery of Documents. In the case of the designation of
Additional Accounts, the Participating Transferors shall deliver to the
Trustee (i) the computer file or microfiche list required to be delivered
pursuant to Section 2.01 with respect to such Additional Accounts on the
applicable Document Delivery Date and (ii) a duly executed, written Assignment
(including an acceptance by the Trustee for the benefit of the
Certificateholders), substantially in the form of Exhibit B (the
"Assignment"), on the Document Delivery Date.
(h) Additional Account Owners. In addition to the Receivables
Purchase Agreement entered with the Bank on the Substitution Date, LLC, as
Transferor, or an Additional Transferor may enter into one or more additional
Receivables Purchase Agreements and may purchase Receivables and related
assets under the terms of such Receivables Purchase Agreement or Receivables
Purchase Agreements if (i) the Account Owner and the Transferor under the
additional Receivables Purchase Agreement is an Affiliate of Chase USA, (ii)
the Rating Agency Condition is satisfied and (iii) a Tax Opinion with respect
to the addition of such Additional Account Owner has been delivered to the
Trustee. It is understood that addition to the Trust of Receivables purchased
by the Transferor in the Additional Accounts designated thereunder shall be
subject to the relevant provisions of Section 2.08.
SECTION 2.09. Removal of Accounts. On any day of any Monthly
Period each Transferor shall have the right to require the reassignment to it
or its designee of all the Trust's and the Trustee's right, title and interest
in, to and under the Receivables then existing and thereafter created, all
moneys due or to become due and all amounts received with respect thereto and
all proceeds thereof (but excluding from such reassigned amounts all
Recoveries relating thereto resulting from the sale or re-securitization of
Receivables pursuant to a Grouped Charge Off Disposition) in or with respect
to the Accounts designated by such Transferor (the "Removed Accounts"), upon
satisfaction of the following conditions:
(a) on or before the tenth Business Day immediately preceding the
Removal Date (the "Removal Notice Date"), such Transferor shall have given the
Trustee, the Servicer, each Rating Agency and any Series Enhancer entitled
thereto pursuant to the relevant Supplement written notice of such removal and
specifying the date for removal of the Removed Accounts (the "Removal Date");
(b) on or prior to the date that is 10 Business Days after the
Removal Date, such Transferor shall have amended Schedule 1 by delivering to
the Trustee a computer file or microfiche list containing a true and complete
list of the Removed Accounts specifying for each such Account, as of the
Removal Notice Date, its account number, the aggregate amount outstanding in
such Account and the aggregate amount of Principal Receivables outstanding in
such Account;
(c) such Transferor shall have represented and warranted on or prior
to the date that is 10 Business Days after the Removal Date that the list of
Removed Accounts delivered pursuant to paragraph (b) above was, as of the
Removal Notice Date, true and complete in all material respects;
(d) the Rating Agency Condition shall have been satisfied with
respect to such removal; provided, however, that if (i) the amount of
Principal Receivables outstanding in each
36
such Removed Account is zero and (ii) each such Removed Account (x) has had no
activity in the previous 180 days, (y) has been closed or (z) has had its
Receivables charged off as uncollectible, the Rating Agency Condition shall
not apply;
(e) such Transferor shall have delivered to the Trustee and any
Series Enhancer entitled thereto pursuant to the relevant Supplement an
Officer's Certificate, dated the Removal Date, to the effect that such
Transferor reasonably believes that (i) such removal will not, based on the
facts known to such officer at the time of such certification, then or
thereafter cause a Pay Out Event to occur with respect to any Series and (ii)
no selection procedure was utilized by such Transferor which would result in a
selection of Removed Accounts that would be materially adverse to the
interests of the Investor Certificateholders of any Series as of the Removal
Date;
(f) as of the Removal Notice Date, either (i) the Receivables in the
Accounts owned or designated by such Transferor are not more than 15%
delinquent by estimated principal amount and the weighted average delinquency
of such Receivables is not more than 60 days or (ii) the Receivables in the
Accounts owned by such Transferor are not more than 7% delinquent by estimated
principal amount and the weighted average delinquency of such Receivables does
not exceed 90 days;
(g) subject to the exceptions set forth in Section 2.09(h), (i) no
more than one Removal Date shall occur in any Monthly Period and (ii) for each
Removal Date, the Accounts to be designated as Removed Accounts shall be
selected at random by the Transferor and the Removed Accounts shall not, as of
the Removal Notice Date, contain Principal Receivables which in the aggregate
exceed an amount equal to the excess, if any, of the Transferors'
Participation Amount over the Required Transferors' Participation Amount; and
(h) the following Accounts may be removed on any day and shall not
be subject to the limitations described in Section 2.09(g):
(i) any Accounts that contain Defaulted Receivables;
(ii) any Accounts described in the proviso of Section 2.09(d);
or
(iii) any Accounts originated or acquired under an affinity,
private label, agent bank, co-branding or other arrangement with a
third party, which has been cancelled by such third party or which
has expired without renewal and which cancellation or expiration
without renewal has arisen in response to a third-party action or
decision not to act and not the unilateral action of the Account
Owner and which by its terms permits the third party to purchase the
Accounts or Receivables subject to such arrangement, upon such
cancellation or non-renewal and such third party in fact purchases
such Account or Receivables.
Upon satisfaction of the above conditions, the Trustee shall execute
and deliver to the relevant Transferor a written reassignment in substantially
the form of Exhibit C (the "Reassignment") and shall, without further action,
sell, transfer, assign, set over and otherwise convey to such Transferor or
its designee, effective as of the Removal Date, without recourse,
representation or warranty, all the right, title and interest of the Trustee
in and to the Receivables
37
arising in the Removed Accounts, all moneys due and to become due and all
amounts received with respect thereto and all proceeds thereof. In addition,
the Trustee shall execute such other documents and instruments of transfer or
assignment and take such other actions as shall reasonably be requested by the
relevant Transferor to effect the conveyance of Receivables pursuant to this
Section.
SECTION 2.10. Account Allocations. In the event that any Transferor
is unable for any reason to transfer Receivables to the Trustee in accordance
with the provisions of this Agreement, including by reason of the application
of the provisions of Section 9.02 or any order of any Governmental Authority
(a "Transfer Restriction Event"), then, in any such event, (a) such Transferor
agrees (except as prohibited by any such order) to allocate and pay to the
Trustee, after the date of such inability, all Collections of Receivables
transferred to the Trustee by such Transferor, including Collections of
Receivables transferred to the Trustee by such Transferor prior to the
occurrence of such event, and all amounts which would have constituted
Collections but for such Transferor's inability to transfer Receivables (up to
an aggregate amount equal to the amount of Receivables transferred to the
Trustee by such Transferor in the Trust on such date), (b) such Transferor
agrees that such amounts will be applied as Collections in accordance with
Article IV and the terms of each Supplement and (c) for so long as the
allocation and application of all Collections and all amounts that would have
constituted Collections are made in accordance with clauses (a) and (b) above,
Principal Receivables and all amounts which would have constituted Principal
Receivables but for such Transferor's inability to transfer Receivables to the
Trustee which are written off as uncollectible in accordance with this
Agreement shall continue to be allocated in accordance with Article IV and the
terms of each Supplement. For the purpose of the immediately preceding
sentence, such Transferor shall treat the first received Collections with
respect to the Accounts designated by such Transferor as allocable to the
Trustee until the Trustee shall have been allocated and paid Collections in an
amount equal to the aggregate amount of Principal Receivables in such Accounts
as of the date of the occurrence of such event. If such Transferor is unable
pursuant to any Requirements of Law to allocate Collections as described
above, such Transferor agrees that, after the occurrence of such event,
payments on each Account designated by such Transferor with respect to the
principal balance of such Account shall be allocated first to the oldest
principal balance of such Account and shall have such payments applied as
Collections in accordance with Article IV and the terms of each Supplement.
The parties hereto agree that Finance Charge Receivables, whenever created,
accrued in respect of Principal Receivables which have been conveyed to the
Trust shall continue to be a part of the Trust notwithstanding any cessation
of the transfer of additional Principal Receivables to the Trustee and
Collections with respect thereto shall continue to be allocated and paid in
accordance with Article IV and the terms of each Supplement.
ARTICLE III
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 3.01. Acceptance of Appointment and Other Matters
Relating to the Servicer. (a) The Bank agrees to act as the Servicer under
this Agreement and the Certificateholders by their acceptance of Certificates
consent to the Bank acting as Servicer.
38
(b) The Servicer shall service and administer the Receivables, shall
collect payments due under the Receivables and shall charge off as
uncollectible Receivables, all in accordance with its customary and usual
servicing procedures for servicing credit card and other consumer revolving
credit receivables comparable to the Receivables and in accordance with the
Lending Guidelines. The Servicer shall have full power and authority, acting
alone or through any party properly designated by it hereunder, to do any and
all things in connection with such servicing and administration which it may
deem necessary or desirable. Without limiting the generality of the foregoing,
subject to Section 10.01 and provided the Bank is the Servicer, the Servicer
or its designee (rather than the Trustee) is hereby authorized and empowered
(i) to make withdrawals and payments or to instruct the Trustee to make
withdrawals and payments from the Collection Account and any Series Account,
as set forth in this Agreement or any Supplement, and (ii) to take any action
required or permitted under any Series Enhancement, as set forth in this
Agreement or any Supplement. Without limiting the generality of the foregoing
and subject to Section 10.01, the Servicer or its designee is hereby
authorized and empowered to make any filings, reports, notices, applications
and registrations with, and to seek any consents or authorizations from, the
Securities and Exchange Commission and any state securities authority on
behalf of the Trust as may be necessary or advisable to comply with any
Federal or state securities laws or reporting requirements. The Trustee shall
furnish the Servicer with any powers of attorney or other documents necessary
or appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder.
(c) The Servicer shall not be obligated to use separate servicing
procedures, offices, employees or accounts for servicing the Receivables from
the procedures, offices, employees and accounts used by the Servicer in
connection with servicing other credit card and consumer revolving credit
receivables.
(d) The Servicer shall comply with and perform its servicing
obligations with respect to the Accounts and Receivables in accordance with
the Lending Agreements relating to the Accounts and the Lending Guidelines and
all applicable rules and regulations of VISA, MasterCard and any other similar
entity or organization relating to any other type of revolving credit card
accounts included as Accounts, except insofar as any failure to so comply or
perform would not materially and adversely affect the Trust or the Investor
Certificateholders.
(e) The Servicer shall pay out of its own funds, without
reimbursement, all expenses incurred in connection with the Trust and the
servicing activities hereunder including expenses related to enforcement of
the Receivables, fees and disbursements of the Trustee, any Paying Agent and
any Transfer Agent and Registrar (including the reasonable fees and expenses
of its counsel) in accordance with Section 11.05, fees and disbursements of
independent accountants and all other fees and expenses, including the costs
of filing UCC continuation statements and the costs and expenses relating to
obtaining and maintaining the listing of any Investor Certificates on any
stock exchange, that are not expressly stated in this Agreement to be payable
by the Trust or the Transferors (other than Federal, state, local and foreign
income, franchise and other taxes, if any, or any interest or penalties with
respect thereto, assessed on the Trust).
(f) The Servicer agrees that upon a request by the Transferors it
will use its best efforts at the expense of the Transferors to obtain and
maintain the listing of the Investor
39
Certificates of any Series or Class on any specified securities exchange. If
any such request is made, the Servicer shall give notice to the Transferors
and the Trustee on the date on which such Investor Certificates are approved
for such listing and within three Business Days following receipt of notice by
the Servicer of any actual, proposed or contemplated delisting of such
Investor Certificates by any such securities exchange. The Transferors may
terminate any listing on any such securities exchange at any time subject to
the notice requirements set forth in the preceding sentence.
SECTION 3.02. Servicing Compensation. As full compensation for
its servicing activities hereunder and as reimbursement for any expense
incurred by it in connection therewith, the Servicer shall be entitled to
receive a servicing fee (the "Servicing Fee") with respect to each Monthly
Period, payable monthly on the related Distribution Date, in an amount equal
to one-twelfth of the product of (a) the weighted average of the Servicing Fee
Rates with respect to each outstanding Series (based upon the Servicing Fee
Rate for each Series and the amount of Receivables serviced on behalf of each
Series, in each case as of the last day of the prior Monthly Period) and (b)
the amount of Principal Receivables on the last day of the prior Monthly
Period. The share of the Servicing Fee allocable to (i) the
Certificateholders' Interest of a particular Series with respect to any
Monthly Period (the "Monthly Servicing Fee") and (ii) the Enhancement Invested
Amount, if any, of a particular Series with respect to any Monthly Period will
each be determined in accordance with the relevant Supplement. The portion of
the Servicing Fee with respect to any Monthly Period not so allocated to the
Certificateholders' Interest or the Enhancement Invested Amount, if any, of a
particular Series shall be paid by the Transferors on the related Distribution
Date and in no event shall the Trust, the Trustee, the Investor
Certificateholders of any Series or any Series Enhancer be liable for the
share of the Servicing Fee with respect to any Monthly Period to be paid by
the Transferors. The Servicer agrees that the portion of the Monthly Servicing
Fee allocable to the Transferors shall be payable solely to the extent of, and
from, the Transferors' allocable portion of Collections of Finance Charge
Receivables as provided in Section 4.03 and, to the extent not so paid, that
the Servicer shall have no recourse to the Transferors in respect thereof. The
Transferors agree that the Servicer may deduct the Transferors' allocable
share of the Monthly Servicing Fee from any amounts due to the Transferors
pursuant to Section 4.03.
SECTION 3.03. Representations, Warranties and Covenants of the
Servicer. The Bank, as initial Servicer, hereby makes, and any Successor
Servicer by its appointment hereunder shall make, on each Closing Date (and on
the date of any such appointment), the following representations, warranties
and covenants:
(a) Organization and Good Standing. The Servicer is a national
banking association duly organized, validly existing and in good standing
under the laws of the United States of America or a corporation duly
organized, validly existing and in good standing under the laws of its state
of incorporation, and has full corporate power, authority and legal right to
execute, deliver and perform its obligations under this Agreement and each
Supplement and, in all material respects, to own its properties and conduct
its business as such properties are presently owned and as such business is
presently conducted.
(b) Due Qualification. The Servicer is duly qualified to do business
and is in good standing as a foreign corporation (or is exempt from such
requirements), and has obtained
40
all necessary licenses and approvals in each jurisdiction in which failure to
so qualify or to obtain such licenses and approvals would have a material
adverse effect on the interests of the Investor Certificateholders hereunder
or under any Supplement.
(c) Due Authorization. The execution, delivery, and performance by
the Servicer of this Agreement and each Supplement have been duly authorized
by the Servicer by all necessary corporate action on the part of the Servicer
and this Agreement and each Supplement will remain, from the time of its
execution, an official record of the Servicer.
(d) Binding Obligation. This Agreement and each Supplement
constitutes a legal, valid and binding obligation of the Servicer, enforceable
in accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereinafter in effect, affecting the enforcement of creditors'
rights in general and the rights of creditors of national banking associations
and except as such enforceability may be limited by general principles of
equity (whether considered in a suit at law or in equity).
(e) No Violation. The execution and delivery of this Agreement and
each Supplement by the Servicer, the performance by the Servicer of the
transactions contemplated by this Agreement and each Supplement and the
fulfillment by the Servicer of the terms hereof and thereof applicable to the
Servicer, will not conflict with, violate, result in any breach of any of the
material terms and provisions of, or constitute (with or without notice or
lapse of time or both) a default under, any Requirement of Law applicable to
the Servicer or any indenture, contract, agreement, mortgage, deed of trust or
other instrument to which the Servicer is a party or by which it or any of its
properties are bound.
(f) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of the Servicer, threatened against the
Servicer before any court, regulatory body, administrative agency or other
tribunal or governmental instrumentality seeking to prevent the issuance of
the Certificates or the consummation of any of the transactions contemplated
by this Agreement or any Supplement, seeking any determination or ruling that,
in the reasonable judgment of the Servicer, would materially and adversely
affect the performance by the Servicer of its obligations under this Agreement
or any Supplement, or seeking any determination or ruling that would
materially and adversely affect the validity or enforceability of this
Agreement or any Supplement.
(g) Compliance with Requirements of Law. The Servicer shall duly
satisfy all obligations on its part to be fulfilled under or in connection
with the Receivables and the related Accounts, will maintain in effect all
qualifications required under Requirements of Law in order to properly service
the Receivables and the related Accounts and will comply in all material
respects with all other Requirements of Law in connection with servicing the
Receivables and the related Accounts, the failure to comply with which would
have a material adverse effect on the interests of the Investor
Certificateholders.
(h) No Rescission or Cancelation. Subject to Section 3.09, the
Servicer shall not permit any rescission or cancelation of a Receivable except
as ordered by a court of
41
competent jurisdiction or other Governmental Authority or in the ordinary
course of its business and in accordance with the Lending Guidelines.
(i) Protection of Certificateholders' Rights. The Servicer shall
take no action which, nor omit to take any action the omission of which, would
substantially impair the rights of Certificateholders in any Receivable or
Account, nor shall it, except in the ordinary course of its business and in
accordance with the Lending Guidelines, reschedule, revise or defer
Collections (other than Interchange to be included as Collections of Finance
Charge Receivables pursuant to Section 2.07(i)) due on the Receivables.
(j) Receivables Not To Be Evidenced by Promissory Notes. Except in
connection with its enforcement or collection of an Account, the Servicer will
take no action to cause any Receivable to be evidenced by any instrument (as
defined in the UCC).
(k) All Consents Required. All approvals, authorizations, consents,
orders or other actions of any Person or of any governmental body or official
required in connection with the execution and delivery by the Servicer of this
Agreement and each Supplement, the performance by the Servicer of the
transactions contemplated by this Agreement and each Supplement and the
fulfillment by the Servicer of the terms hereof and thereof, have been
obtained; provided, however, that the Servicer makes no representation or
warranty regarding state securities or "blue sky" laws in connection with the
distribution of the Certificates.
For purposes of the representations and warranties set forth in this
Section 3.03, each reference to a Supplement shall be deemed to refer only to
those Supplements in effect as of the relevant Closing Date or the date of
appointment of a Successor Servicer, as applicable.
In the event any of the representations, warranties or covenants of
the Servicer contained in paragraph (g), (h), (i) or (j) with respect to any
Receivable or the related Account is breached, and as a result of such breach
the Trustee's rights in, to or under any Receivables in the related Account or
the proceeds of such Receivables are impaired or such proceeds are not
available for any reason to the Trustee free and clear of any Lien, then no
later than the expiration of 60 days (or such longer period, not in excess of
150 days, as may be agreed to by the Trustee) from the earlier to occur of the
discovery of such event by the Servicer, or receipt by the Servicer of notice
of such event given by the Trustee, all Receivables in the Account or Accounts
to which such event relates shall be assigned to the Servicer on the terms and
conditions set forth below; provided, however, that such Receivables will not
be assigned to the Servicer if, on any day prior to the end of such 60-day or
longer period, (i) the relevant representation and warranty shall be true and
correct, or the relevant covenant shall have been complied with, in all
material respects and (ii) the Servicer shall have delivered to the Trustee a
certificate of an authorized officer describing the nature of such breach and
the manner in which such breach was cured.
The Servicer shall effect such assignment by making a deposit into
the Collection Account in immediately available funds on the Transfer Date
following the Monthly Period in which such assignment obligation arises in an
amount equal to the amount of such Receivables, which deposit shall be
considered a Transfer Deposit Amount and shall be applied in accordance with
Article IV and the terms of each Supplement. Upon each such assignment to the
Servicer,
42
the Trustee shall automatically and without further action be deemed to sell,
transfer, assign, set over and otherwise convey to the Servicer, without
recourse, representation or warranty, all right, title and interest of the
Trust and the Trustee in and to such Receivables, all moneys due or to become
due and all amounts received with respect thereto and all proceeds thereof.
The Trustee shall execute such documents and instruments of transfer or
assignment and take such other actions as shall be reasonably requested by the
Servicer to effect the conveyance of any such Receivables pursuant to this
Section. The obligation of the Servicer to accept assignment of such
Receivables, and to make the deposits, if any, required to be made to the
Collection Account as provided in the preceding paragraph, shall constitute
the sole remedy respecting the event giving rise to such obligation available
to Certificateholders (or the Trustee on behalf of Certificateholders) or any
Series Enhancer, except as provided in Section 8.04.
SECTION 3.04. Reports and Records for the Trustee. (a) Daily
Records. On each Business Day, the Servicer shall make or cause to be made
available at the office of the Servicer during normal business hours for
inspection by the Trustee and the Transferors upon request a record setting
forth (i) the Collections in respect of Principal Receivables and in respect
of Finance Charge Receivables processed by the Servicer on the second
preceding Business Day in respect of each Account and (ii) the amount of
Receivables as of the close of business on the second preceding Business Day
in each Account. The Servicer shall, at all times, maintain its computer files
with respect to the Accounts in such a manner so that the Accounts may be
specifically identified and shall make available to the Trustee and the
Transferors at the office of the Servicer on any Business Day during normal
business hours any computer programs necessary to make such identification.
(b) Monthly Servicer's Certificate. Not later than the third
Business Day preceding each Distribution Date, the Servicer shall, with
respect to each outstanding Series, deliver to the Trustee, the Transferors,
the Paying Agent, each Rating Agency and each Series Enhancer entitled thereto
pursuant to the relevant Supplement a certificate of a Servicing Officer in
substantially the form set forth in the related Supplement.
SECTION 3.05. Annual Certificate of Servicer. The Servicer shall
deliver to the Trustee, the Transferors, each Rating Agency and each Series
Enhancer entitled thereto pursuant to the relevant Supplement, on or before
March 31 of each calendar year, beginning with March 31, 1994, an Officer's
Certificate (with appropriate insertions) substantially in the form of Exhibit
D.
SECTION 3.06. Annual Servicing Report of Independent Public
Accountants, Copies of Reports Available. (a) (i) On or before March 31 of
each calendar year, beginning with March 31, 1994 and ending on March 31,
2002, the Servicer shall cause a firm of nationally recognized independent
public accountants (who may also render other services to the Account Owner,
the Servicer or the Transferors) to furnish a report (addressed to the
Trustee) to the Trustee, the Transferors, the Servicer and each Rating Agency
to the effect that they have applied certain procedures agreed upon with the
Servicer and examined certain documents and records relating to the servicing
of Receivables under this Agreement and each Supplement and that, on the basis
of such agreed-upon procedures, such accountants are of the opinion that the
servicing (including the allocation of Collections) has been conducted in
compliance with the terms and conditions set forth in Articles III and Article
IV and Section 8.08 of this Agreement
43
and the applicable provisions of each Supplement, except for such exceptions
as they believe to be immaterial and such other exceptions as shall be set
forth in such statement. Such report shall set forth the agreed-upon
procedures performed. A copy of such report shall be delivered to each Series
Enhancer entitled thereto pursuant to the relevant Supplement.
(ii) On or before March 31 of each calendar year, beginning
with March 31, 2003, the Servicer shall cause a firm of nationally
recognized independent public accountants (who may also render other
services to the Account Owner, the Servicer or the Transferors) to
furnish a report (addressed to the Trustee) to the Trustee, the
Transferors, the Servicer and each Rating Agency, to the effect that
such firm has examined management's assertion that, as of the date
of such report, the system of internal control over servicing of
securitized credit card receivables met the criteria for effective
internal control described in the report entitled "Internal Control
- Integrated Framework" issued by the Committee of Sponsoring
Organizations of the ▇▇▇▇▇▇▇▇ Commission ("COSO") and that in their
opinion, management's assertion is fairly stated, in all material
respects with such exceptions, if any, as shall be set forth
therein. A copy of such report shall be distributed by the Trustee
to the Rating Agency and will be available for distribution to
Certificateholders upon written request therefor addressed to the
Trustee at the Corporate Trust Office. A copy of such report shall
be delivered to each Series Enhancer entitled thereto pursuant to
the relevant Supplement.
(b) (i) On or before March 31 of each calendar year, beginning with
March 31, 1994 and ending on March 31, 2002, the Servicer shall cause a firm
of nationally recognized independent public accountants (who may also render
other services to the Account Owner, the Servicer or the Transferors) to
furnish a report to the Trustee, the Transferors, the Servicer and each Rating
Agency to the effect that they have applied certain procedures agreed upon
with the Servicer to compare the mathematical calculations of certain amounts
set forth in the Servicer's certificates delivered pursuant to Section 3.04(b)
during the period covered by such report with the Servicer's computer reports
which were the source of such amounts and that on the basis of such
agreed-upon procedures and comparison, such accountants are of the opinion
that such amounts are in agreement, except for such exceptions as they believe
to be immaterial and such other exceptions as shall be set forth in such
statement. A copy of such report shall be delivered to each Series Enhancer
entitled thereto pursuant to the relevant Supplement.
(ii) On or before March 31 of each calendar year, beginning
with March 31, 2003, the Servicer shall cause a firm of nationally
recognized independent public accountants (who may also render other
services to the Account Owner, the Servicer or the Transferors) to
furnish a report to the Trustee, the Transferors, the Servicer and
each Rating Agency prepared using generally accepted attestation
standards, to the effect that they have randomly selected at least
one (1) of the monthly certificates forwarded by the Servicer
pursuant to subsection 3.04(b) during each of the three month
periods ended March 31, June 30, September 30 and December 31 during
the period covered by such report (which shall be the twelve month
period ending on December 31 of the preceding calendar year, or if
shorter the period from the Substitution Date to December 31, 2002)
and compared such amounts with the Servicer's computer reports which
were the source of such amounts and found them to be in agreement or
shall disclose any exceptions noted. Additionally, such firm shall
recalculate the mathematical
44
accuracy of amounts derived in the monthly certificates. A copy of
such report shall be distributed by the Trustee to each Rating
Agency and to each Series Enhancer entitled thereto pursuant to the
relevant Supplement. Notwithstanding the foregoing, it is understood
that for any period covered by such report during which there was
more than one Servicer, the responsibility for such report may be
divided between the accountants for such Servicers, with each
accounting firm issuing a separate report taking responsibility only
for a portion of the period covered as shall be specifed in such
report.
(c) A copy of each certificate and report provided pursuant to
Section 3.04(b), 3.05 or 3.06 may be obtained by any Investor
Certificateholder or Certificate Owner by a request to the Trustee addressed
to the Corporate Trust Office.
SECTION 3.07. Tax Treatment. Chase USA and the Transferors have
entered into this Agreement, and the Certificates will be issued, with the
intention that, for Federal, state and local income and franchise tax purposes
only, the Investor Certificates of each Series which are characterized as
indebtedness at the time of their issuance will qualify as indebtedness of
Chase USA secured by the Receivables. Chase USA and the Transferors, by
entering into this Agreement, and each Certificateholder, by the acceptance of
any such Certificate (and each Certificate Owner, by its acceptance of an
interest in the applicable Certificate), agree to treat such Investor
Certificates for Federal, state and local income and franchise tax purposes as
indebtedness of Chase USA.
SECTION 3.08. Notices to the Bank. In the event that the Bank is
no longer acting as Servicer, any Successor Servicer shall deliver to the Bank
each certificate and report required to be provided thereafter pursuant to
Section 3.04(b), 3.05 or 3.06.
SECTION 3.09. Adjustments. (a) If the Servicer adjusts downward
the amount of any Principal Receivable because of a rebate, refund,
unauthorized charge or billing error to an accountholder, or because such
Principal Receivable was created in respect of merchandise which was refused
or returned by an accountholder, or if the Servicer otherwise adjusts downward
the amount of any Principal Receivable without receiving Collections therefor
or charging off such amount as uncollectible, then, in any such case, the
amount of Principal Receivables used to calculate the Transferors'
Participation Amount, the Transferors' Interest, the Floating Allocation
Percentage and the Principal Allocation Percentage applicable to any Series
will be reduced by the amount of the adjustment. Similarly, the amount of
Principal Receivables used to calculate the Transferors' Participation Amount,
the Transferors' Interest, the Floating Allocation Percentage and the
Principal Allocation Percentage applicable to any Series will be reduced by
the amount of any Principal Receivable which was discovered as having been
created through a fraudulent or counterfeit charge. Any adjustment required
pursuant to either of the two preceding sentences shall be made on or prior to
the second Business Day after the day on which such adjustment obligation
arises. In the event that, following the exclusion of such Principal
Receivables from the calculation of the Transferors' Participation Amount, the
Transferors' Participation Amount would be a negative number, not later than
12:00 noon, New York City time, on the second Business Day following the day
on which such adjustment obligation arises, the Transferor which transferred
such Principal Receivables to the Trustee shall make a deposit into the
Collection Account in immediately available funds in an amount equal to the
amount by which the Transferors' Participation
45
Amount would be below zero (up to the amount of such Principal Receivables).
Any amount deposited into the Collection Account pursuant to the preceding
sentence shall be considered an "Adjustment Payment" and shall be applied in
accordance with Article IV and the terms of each Supplement.
(b) If (i) the Servicer makes a deposit into the Collection Account
in respect of a Collection of a Receivable and such Collection was received by
the Servicer in the form of a check which is not honored for any reason or
(ii) the Servicer makes a mistake with respect to the amount of any Collection
and deposits an amount that is less than or more than the actual amount of
such Collection, the Servicer shall appropriately adjust the amount
subsequently deposited into the Collection Account to reflect such dishonored
check or mistake. Any Receivable in respect of which a dishonored check is
received shall be deemed not to have been paid.
SECTION 3.10. Reports to the Commission. The Servicer shall, on
behalf of the Trust, cause to be filed with the Securities and Exchange
Commission (the "Commission") any periodic reports required to be filed under
the provisions of the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission thereunder. The Transferors, if the
Bank is not the Servicer, shall, at the expense of the Transferor, cooperate
in any reasonable request of the Servicer in connection with such filings.
ARTICLE IV
RIGHTS OF CERTIFICATEHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION 4.01. Rights of Certificateholders. The Investor
Certificates shall represent fractional undivided interests in the Trust,
which, with respect to each Series, shall consist of the right to receive, to
the extent necessary to make the required payments with respect to the
Investor Certificates of such Series at the times and in the amounts specified
in the related Supplement, the portion of Collections allocable to Investor
Certificateholders of such Series pursuant to this Agreement and such
Supplement, funds on deposit in the Collection Account allocable to
Certificateholders of such Series pursuant to this Agreement and such
Supplement, funds on deposit in any related Series Account and funds available
pursuant to any related Series Enhancement (collectively, with respect to all
Series, the "Certificateholders' Interest"), it being understood that the
Investor Certificates of any Series or Class shall not represent any interest
in any Series Account or Series Enhancement for the benefit of any other
Series or Class. The Transferors' Interest shall represent the ownership
interest in the remainder of the Trust Assets not allocated pursuant to this
Agreement or any Supplement to the Certificateholder's Interest, including the
right to receive Collections with respect to the Receivables and other amounts
at the times and in the amounts specified in this Agreement or any Supplement
to be paid to the Transferors on behalf of all holders of the Transferors'
Interest; provided, however, that the Transferors' Interest shall not
represent any interest in the Collection Account, any Series Account or any
Series Enhancement, except as specifically provided in this Agreement or any
Supplement; provided further that the foregoing shall not be construed to
limit the Trustee's obligations to make payments to the Transferors and the
Servicer as and when required under this Agreement and any Supplement.
46
SECTION 4.02. Establishment of Collection Account and Special
Funding Account. The Servicer, for the benefit of the Certificateholders,
shall establish and maintain in the name of the Trustee an Eligible Deposit
Account bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Certificateholders (the "Collection
Account"). The Trustee shall possess all right, title and interest in all
funds on deposit from time to time in the Collection Account and in all
proceeds thereof. The Collection Account shall be under the sole dominion and
control of the Trustee. Except as expressly provided in this Agreement, the
Servicer agrees that it shall have no right of setoff or banker's lien
against, and no right to otherwise deduct from, any funds held in the
Collection Account for any amount owed to it by the Trustee, the Trust, any
Certificateholder or any Series Enhancer. If, at any time, the Collection
Account ceases to be an Eligible Deposit Account, the Trustee (or the Servicer
on its behalf) shall within 10 Business Days (or such longer period, not to
exceed 30 calendar days, as to which each Rating Agency may consent) establish
a new Collection Account meeting the conditions specified above, transfer any
cash and/or any investments to such new Collection Account and from the date
such new Collection Account is established, it shall be the "Collection
Account".
Unless otherwise agreed by each Rating Agency, if at any time
neither the Bank nor any other affiliate of the Bank is the Servicer, the
Collection Account will be moved from the Bank if then maintained there.
Funds on deposit in the Collection Account (other than amounts
deposited pursuant to Section 2.06, 9.02, 10.01 or 12.02) shall at the
direction of the Servicer be invested by the Trustee in Eligible Investments
selected by the Servicer. All such Eligible Investments shall be held by the
Trustee. Investments of funds representing Collections collected during any
Monthly Period shall be invested in Eligible Investments that will mature so
that all funds will be available at the close of business on the Transfer Date
following such Monthly Period. No Eligible Investment shall be disposed of
prior to its maturity; provided, however, that the Trustee shall sell,
liquidate or dispose of an Eligible Investment before its maturity, if so
directed by the Servicer, if a default by, or a downgrade of, the obligor of
such Eligible Investment has occurred. Unless directed by the Servicer, funds
deposited in the Collection Account on a Transfer Date with respect to the
next following Distribution Date are not required to be invested overnight. On
each Distribution Date, all interest and other investment earnings (net of
losses and investment expenses) on funds on deposit in the Collection Account
shall be treated as Collections of Finance Charge Receivables with respect to
the last day of the related Monthly Period, except as otherwise specified in
any Supplement. For purposes of determining the availability of funds or the
balances in the Collection Account for any reason under this Agreement, all
investment earnings net of investment expenses and losses on such funds shall
be deemed to be available or on deposit.
The Servicer, for the benefit of the Certificateholders, shall
establish and maintain in the name of the Trustee an Eligible Deposit Account
bearing a designation clearly indicating that the funds deposited therein are
held for the benefit of the Certificateholders (the "Special Funding
Account"). The Trustee shall possess all right, title and interest in all
funds on deposit from time to time in the Special Funding Account and in all
proceeds thereof. The Special Funding Account shall be under the sole dominion
and control of the Trustee. Except as expressly provided in this Agreement,
the Servicer agrees that it shall have no right of setoff or
47
banker's lien against, and no right to otherwise deduct from, any funds held
in the Special Funding Account for any amount owed to it by the Trustee, the
Trust, any Certificateholder or any Series Enhancer. If, at any time, the
Special Funding Account ceases to be an Eligible Deposit Account, the Trustee
(or the Servicer on its behalf) shall within 10 Business Days (or such longer
period, not to exceed 30 calendar days, as to which each Rating Agency may
consent) establish a new Special Funding Account meeting the conditions
specified above, transfer any cash and/or any investments to such new Special
Funding Account and from the date such new Special Funding Account is
established, it shall be the "Special Funding Account."
Unless otherwise agreed by each Rating Agency, if at any time
neither the Bank nor any other Affiliate of the Bank is the Servicer, the
Special Funding Account will be moved from the Bank if then maintained there.
Funds on deposit in the Special Funding Account shall at the direction of the
Servicer be invested by the Trustee in Eligible Investments selected by the
Servicer. All such Eligible Investments shall be held by the Trustee. Funds on
deposit in the Special Funding Account on any Distribution Date will be
invested in Eligible Investments that will mature so that all funds will be
available at the close of business on the Transfer Date following such Monthly
Period. No Eligible Investment shall be disposed of prior to its maturity;
provided, however, that the Trustee shall sell, liquidate or dispose of an
eligible Investment before its maturity, if so directed by the Servicer, if a
default by, or a downgrade of, the obligor of such Eligible Investment has
occurred. Unless directed by the Servicer, funds deposited in the Special
Funding Account on a Transfer Date with respect to the next following
Distribution Date are not required to be invested overnight. On each
Distribution Date, all interest and other investment earnings (net of losses
and investment expenses) on funds on deposit in the Special Funding Account
shall be treated as Collections of Finance Charge Receivables with respect to
the last day of the related Monthly Period except as otherwise specified in
the related Supplement. Funds on deposit in the Special Funding Account will
be withdrawn and paid to the Transferors on any Distribution Date to the
extent that the Transferors' Participation Amount exceeds the Required
Transferors' Participation Amount and the aggregate amount of Principal
Receivables in the Trust exceeds the Required Principal Balance on such date
(in each case determined after giving effect to any Principal Receivables
transferred to the Trust on such date); provided, however, that, if an
Accumulation Period, Scheduled Amortization Period or Early Amortization
Period has commenced and is continuing with respect to one or more outstanding
Series, any funds on deposit in the Special Funding Account shall be treated
as Shared Principal Collections and shall be allocated and distributed in
accordance with Section 4.04 and the terms of each Supplement. For purposes of
determining the availability of funds or the balances in the Special Funding
Account for any reason under this Agreement, all investment earnings net of
investment expenses and losses on such funds shall be deemed not to be
available or on deposit.
The Trustee shall hold each Eligible Investment (other than such as
are described in clauses (b) or (f) of the definition thereof) that
constitutes investment property through a securities intermediary designated
by the Servicer (which may be the Trustee), which securities intermediary
shall agree with the Trustee that (i) such investment property shall at all
times be credited to a securities account of the Trustee, (ii) such securities
intermediary shall comply with entitlement orders originated by the Trustee
without the further consent of any other person or entity, (iii) all property
credited to such securities account shall be treated as financial assets, (iv)
48
such securities intermediary shall treat the Trustee as entitled to exercise
the rights that comprise each financial asset credited to such securities
account, (v) such securities account and the property credited thereto shall
not be subject to any lien, security interest, or right of set-off in favor of
such securities intermediary or anyone claiming through it (other than the
Trustee), (vi) such securities intermediary shall not agree with any person or
entity other than the Trustee to comply with entitlement orders originated by
such other person or entity, (vii) such agreement shall be governed by the
laws of the State of New York, and (viii) the State of New York shall be the
securities intermediary's jurisdiction for purposes of Article 8 of the New
York UCC. Terms used in this paragraph that are defined in the New York UCC
and not otherwise defined herein shall have the meaning set forth in the New
York UCC. Except as permitted by this paragraph, the Trustee shall not hold
any Eligible Investment through an agent or nominee.
The Trustee shall maintain possession of each other Eligible
Investment not described in the preceding paragraph in the State of New York.
SECTION 4.03. Collections and Allocations. (a) The Servicer will
apply or will instruct the Trustee to apply all funds on deposit in the
Collection Account as described in this Article IV and in each Supplement.
Except as otherwise provided below, the Servicer shall deposit Collections
into the Collection Account no later than the second Business Day following
the Date of Processing of such Collections, except for Collections consisting
of Allocated Interchange, the Certificateholders' allocable portion of which
the Servicer shall deposit into the Collection Account no later than 12:00
noon, New York City time, on the Transfer Date and the Transferors' allocable
portion of which the Transferors shall retain.
Subject to the express terms of any Supplement, but notwithstanding
anything else in this Agreement to the contrary, if and for so long as the
Servicer is the Bank or an Affiliate of the Bank and (x) maintains a
certificate of deposit rating of A-1 or better by Standard & Poor's and P-1 by
Moody's, or (y) the Bank has provided to the Trustee a letter of credit
covering collection risk of the Servicer acceptable to the Rating Agency (as
evidenced by a letter from the Rating Agency), the Servicer need not make the
daily deposits of Collections into the Collection Account as provided in the
preceding sentence, but may make a single deposit in the Collection Account in
immediately available funds not later than 12:00 noon, New York City time, on
the Transfer Date, except for the Transferors' allocable portion of
Collections consisting of Allocated Interchange, which the Transferors shall
retain. Subject to the two provisos in Section 4.04 (assuming for purposes of
this Section 4.03(a) that such provisos applied on a daily basis), but
notwithstanding anything else in this Agreement to the contrary, with respect
to any Monthly Period when the Servicer is required to make deposits of
Collections pursuant to the second sentence of the preceding paragraph, the
Servicer will only be required to deposit Collections into the Collection
Account up to the sum of (x) the aggregate amount of Collections required to
be deposited into any Series Account (including Monthly Interest (as defined
in the related Supplement)) to be distributed on the related Distribution Date
or, without duplication, distributed on or prior to the related Distribution
Date to Investor Certificateholders or to any Series Enhancer pursuant to the
terms of any Supplement or Enhancement Agreement, (y) the aggregate of the
Investor Certificateholders' portions of the daily Defaulted Amounts for such
Monthly Period and (z) the aggregate of the daily allocations of the Monthly
Servicing Fees for such Monthly Period for such Series (calculated pursuant to
Section 3.02 of this Agreement); provided, however, that (i) as long as the
Bank or an Affiliate of the Bank is the Servicer
49
(A) with respect to any Series for which any Monthly Interest is determined on
a floating rate basis, at such time in each Monthly Period when each floating
rate that is used in calculating Monthly Interest for such Series for such
Monthly Period has been determined thereafter, to the extent that all funds
required under clause (x) above have been deposited in the Collection Account
with respect to such Series, then no additional funds will be required to be
deposited pursuant to clause (z) above and (B) with respect to any Series for
which Monthly Interest is determined on a fixed rate basis, to the extent that
all funds required under clause (x) above have been deposited in the
Collection Account with respect to such Series, then no additional funds will
be required to be deposited pursuant to clause (z) above and (ii) if at any
time prior to such Distribution Date the amount of Collections deposited in
the Collection Account exceeds the amount required to be deposited, the
Servicer will be permitted to withdraw the excess from the Collection Account
and pay it to the Holder of the Transferors' Interest. With respect to any
Monthly Period when the Servicer is authorized to make deposits of Collections
pursuant to the last sentence of the preceding paragraph, the Servicer will
only be required to deposit Collections into the Collection Account up to the
aggregate amount of Collections required to be deposited into any Series
Account or, without duplication, distributed on or prior to the related
Distribution Date to Investor Certificateholders or to any Series Enhancer
pursuant to the terms of any Supplement or Enhancement Agreement, provided,
however, that if at any time prior to such Distribution Date the amount of
Collections deposited in the Collection Account exceeds the amount required to
be deposited, the Servicer will be permitted to withdraw the excess from the
Collection Account and pay it to the Holder of the Transferors' Interest.
(b) With respect to each day during each Monthly Period, (i)
Collections of Finance Charge Receivables will be allocated to the
Certificateholders' Interest of a Series in an amount equal to the product of
the amount of such Collections and the Floating Allocation Percentage of such
Series with respect to such day during such Monthly Period, (ii) Collections
of Principal Receivables will be allocated to the Certificateholders' Interest
of such Series in an amount equal to the product of the amount of such
Collections and the Principal Allocation Percentage of such Series with
respect to such day during such Monthly Period and (iii) Adjustment Payments
and Transfer Deposit Amounts will be treated as Shared Principal Collections
and will be allocated and distributed in accordance with Section 4.04 and the
terms of each Supplement. With respect to each Monthly Period, and
notwithstanding the foregoing, the Defaulted Amount and Allocated Interchange
will be allocated to the Certificateholders' Interest of a Series based on the
Floating Allocation Percentage of such Series with respect to such Monthly
Period. Subject to Sections 4.03(c) and 4.04, amounts not allocated to the
Certificateholders' Interest of any Series will be allocated to the
Transferors' Interest.
(c) On the earlier of (A) the second Business Day after the Date of
Processing and (B) the day on which the Servicer actually deposits any
Collections into the Collection Account, the Servicer will pay to the
Transferors (i) the Transferors' allocable portion of Collections of Finance
Charge Receivables (except for such Collections consisting of Interchange, to
the extent that the Transferors have retained their allocable portion thereof
pursuant to Section 4.03(a) and except for the Transferors' allocable share of
the Monthly Servicing Fee which the Servicer is permitted to retain in
accordance with Section 3.02) and (ii) the Transferors' allocable portion of
Collections of Principal Receivables; provided, however, that, in the case of
Collections of Principal Receivables allocated to the Transferors' Interest,
such amounts shall be paid to the Transferors only if the Transferors'
Participation Amount
50
(determined after giving effect to any Principal Receivables transferred to
the Trust on such date) exceeds zero; and provided, further, that in the case
of any Shared Principal Collections that would otherwise be paid to the
Transferors pursuant to Section 4.04, such amounts shall be paid to the
Transferors only if the Transferors' Participation Amount exceeds the Required
Transferors' Participation Amount and the aggregate amount of Principal
Receivables in the Trust exceeds the Required Principal Balance (in each case
determined after giving effect to any Principal Receivables transferred to the
Trust on such date). The amount not paid to the Transferors as a result of the
provisos in the preceding sentence ("Unallocated Principal Collections") shall
be deposited on each Distribution Date in the Special Funding Account;
provided, however, that if any Series is in its Accumulation Period, Scheduled
Amortization Period or Early Amortization Period, any Unallocated Principal
Collections on deposit in the Collection Account shall be deemed to be Shared
Principal Collections and shall be allocated and distributed in accordance
with Section 4.04 and the terms of each Supplement.
The payments to be made to the Transferors pursuant to this Section
4.03(c) do not apply to deposits to the Collection Account or other amounts
that do not represent Collections, including Transfer Deposit Amounts,
Adjustment payment of the purchase price for Receivables pursuant to Section
2.06 or 10.01, proceeds from the sale, disposition or liquidation of
Receivables pursuant to 9.02 or 12.02 or payment of the purchase price for
Certificateholders' Interest of a specific Series pursuant to the related
Supplement.
(d) If the Transferors with respect to Additional Accounts so
designate, the Principal Receivables in Additional Accounts added during any
Monthly Period having an Additional Cut-Off Date as of any day during the
preceding Monthly Period shall be treated as Principal Receivables outstanding
on and after such day for purposes of calculating the Floating Allocation
Percentage and Principal Allocation Percentage for such Monthly Period. Any
such recalculation of the Floating Allocation Percentage and Principal
Allocation Percentage for a Monthly Period shall be effective only on and
after the Addition Date, but the Servicer shall determine the amounts of
Collections and the Defaulted Amounts which would have been allocated to the
Certificateholders Interest of each Series for the portion of such Monthly
Period preceding such Addition Date as if such recalculated Floating
Allocation Percentage and Principal Allocation Percentage had been in effect
and shall adjust the amounts to be allocated for the remainder of such Monthly
Period so that the amounts allocated to the Certificateholders' Interest of
each Series and the Transferors' Interest are equal to the amounts which would
have been allocated to them if such recalculated percentages had been in
effect for the entire Monthly Period.
(e) Unless otherwise provided in any Supplement, on the date on
which (i) an Account becomes a Defaulted Account, (ii) an Account (a) with
respect to which the card has been lost, stolen or authorization prohibited,
and (b) which has had an outstanding balance of zero for at least six months,
has been closed by the Servicer, (iii) an Account (a) which has been
designated by the Servicer as "frozen", revoked or interest accrual
prohibited, and (b) which has had an outstanding balance of zero for at least
two months, has been closed by the Servicer, the Trust shall automatically and
without further action or consideration be deemed to transfer, set over, and
otherwise convey to the Transferor, without recourse, representation or
warranty, all the right, title and interest of the Trust such Defaulted
Accounts and Accounts with zero balances, including, with respect to Defaulted
Accounts, all right, title and interest in and to
51
Receivables in such Defaulted Accounts, all monies due or to become due with
respect to such Receivables, all proceeds of such Receivables and Insurance
Proceeds relating to such Receivables allocable to the Trust with respect to
such Receivables. Notwithstanding any such transfer of Accounts, amounts
recovered with respect to such Defaulted Accounts shall still be allocated to
the Trust to the extent provided for in the definition of Recoveries.
SECTION 4.04. Shared Principal Collections. On each Distribution
Date, (a) the Servicer shall allocate Shared Principal Collections to each
Series, pro rata, in proportion to the Principal Shortfalls, if any, with
respect to each Series and (b) the Servicer shall withdraw from the Collection
Account and pay to the Transferors an amount equal to the excess, if any, of
(x) the aggregate amount for all outstanding Series of Collections of
Principal Receivables which the related Supplements or this Agreement specify
are to be treated as "Shared Principal Collections" for such Distribution Date
over (y) the aggregate amount for all outstanding Series which the related
Supplements specify are "Principal Shortfalls" for such Distribution Date;
provided, however, that such amounts shall be paid to the Transferors only if
the Transferors' Participation Amount for such Distribution Date (determined
after giving effect to any Principal Receivables transferred to the Trust on
such date) exceeds zero; and provided, further, that, if, on any Distribution
Date, the Transferors' Participation Amount is less than or equal to the
Required Transferors' Participation Amount or the aggregate amount of
Principal Receivables is less than or equal to the Required Principal Balance
(in each case determined after giving effect to any Principal Receivables
transferred to the Trust on such date), the Servicer will not distribute to
the Transferors any Shared Principal Collections or any Transfer Deposit
Amounts or Adjustment Payments then on deposit in the Collection Account that
otherwise would be distributed to the Transferors, but shall deposit such
funds in the Special Funding Account.
SECTION 4.05. Additional Finance Charges. On each Distribution
Date, (a) the Servicer shall allocate Additional Finance Charges with respect
to the Series in a Group to each Series in such Group, pro rata, in proportion
to the Finance Charge Shortfalls, if any, with respect to each such Series and
(b) the Servicer shall withdraw (or shall instruct the Trustee to withdraw)
from the Collection Account and pay to the Transferors an amount equal to the
excess, if any, of (x) the aggregate amount for all outstanding Series in a
Group of the amounts which the related Supplements specify are to be treated
as "Additional Finance Charges" for such Distribution Date over (y) the
aggregate amount for all outstanding Series in such Group which the related
Supplements specify are "Finance Charge Shortfalls" for such Distribution
Date; provided, however, that the sharing of Additional Finance Charges among
Series in a Group will continue only until such time, if any, at which a
Transferor shall deliver to the Trustee an Officer's Certificate to the effect
that, in the reasonable belief of such Transferor, the continued sharing of
Additional Finance Charges among Series in any Group would have adverse
regulatory implications with respect to such Transferor or the Account Owner.
Following the delivery by a Transferor of such an Officer's Certificate to the
Trustee there will not be any further sharing of Additional Finance Charges
among Series in any Group.
52
ARTICLE V
DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS
Distributions shall be made to, and reports shall be provided to,
Certificateholders as set forth in the applicable Supplement.
ARTICLE VI
THE CERTIFICATES
SECTION 6.01. The Certificates. The Investor Certificates of any
Series or Class may be issued in bearer form ("Bearer Certificates") with
attached interest coupons and any other applicable coupon (collectively, the
"Coupons") or in fully registered form ("Registered Certificates") and shall
be substantially in the form of the exhibits with respect thereto attached to
the applicable Supplement. The Base Interest, which initially represents the
entire Transferors' Interest, is in uncertificated form. Except as otherwise
provided in Section 6.03 or in any Supplement, Bearer Certificates shall be
issued in minimum denominations of $5,000 and Registered Certificates shall be
issued in minimum denominations of $1,000 and in integral multiples of $1,000
in excess thereof. If specified in any Supplement, the Investor Certificates
of any Series or Class shall be issued upon initial issuance as a single
certificate evidencing the aggregate original principal amount of such Series
or Class as described in Section 6.13. Each Certificate shall be executed by
manual or facsimile signature on behalf of the Transferors by the President or
any Vice President. Certificates bearing the manual or facsimile signature of
an individual who was, at the time when such signature was affixed, authorized
to sign on behalf of one of a Transferor shall not be rendered invalid,
notwithstanding that such individual ceased to be so authorized prior to the
authentication and delivery of such Certificates or does not hold such office
at the date of such Certificates. Any Certificate which was executed by the
manual or facsimile signature of a duly authorized officer of the Person which
was a Transferor at the time of execution of the Certificate, shall not be
rendered invalid, notwithstanding that such Person ceases to be a Transferor
under this Agreement. No Certificates shall be entitled to any benefit under
this Agreement, or be valid for any purpose, unless there appears on such
Certificate a certificate of authentication substantially in the form provided
for herein executed by or on behalf of the Trustee by the manual signature of
a duly authorized signatory, and such certificate upon any Certificate shall
be conclusive evidence, and the only evidence, that such Certificate has been
duly authenticated and delivered hereunder. Bearer Certificates shall be dated
the Series Issuance Date. All Registered Certificates shall be dated the date
of their authentication.
SECTION 6.02. Authentication of Certificates. The Trustee shall
authenticate and deliver the Investor Certificates of each Series and Class
that are issued upon original issuance to or upon the order of the Transferors
against payment to the Transferors of the purchase price therefor. If
specified in the related Supplement for any Series or Class, the Trustee shall
authenticate and deliver outside the United States the Global Certificate that
is issued upon original issuance thereof.
53
SECTION 6.03. New Issuances. (a) The Transferors may from time to
time direct the Trustee to authenticate one or more new Series of Investor
Certificates. The Investor Certificates of all outstanding Series shall be
equally and ratably entitled as provided herein to the benefits of this
Agreement without preference, priority or distinction, all in accordance with
the terms and provisions of this Agreement and the applicable Supplement
except, with respect to any Series or Class, as provided in the related
Supplement.
(b) On or before the Series Issuance Date relating to any new
Series, the parties hereto will execute and deliver a Supplement which will
specify the Principal Terms of such new Series. The terms of such Supplement
may modify or amend the terms of this Agreement solely as applied to such new
Series. The obligation of the Trustee to authenticate the Investor
Certificates of such new Series and to execute and deliver the related
Supplement is subject to the satisfaction of the following conditions:
(i) on or before the fifth Business Day immediately preceding the
Series Issuance Date, the Transferors shall have given the Trustee, the
Servicer, each Rating Agency and any Series Enhancer entitled thereto
pursuant to the relevant Supplement notice of such issuance and the
Series Issuance Date;
(ii) the Transferors shall have delivered to the Trustee the related
Supplement, in form satisfactory to the Trustee, executed by each party
hereto other than the Trustee;
(iii) the Transferors shall have delivered to the Trustee any
related Enhancement Agreement executed by each of the parties thereto,
other than the Trustee;
(iv) the Rating Agency Condition shall have been satisfied with
respect to such issuance;
(v) the Transferors shall have delivered to the Trustee and any
Series Enhancer entitled thereto pursuant to the relevant Supplement an
Officer's Certificate, dated the Series Issuance Date, to the effect that
such Transferor reasonably believes that such issuance will not, based on
the facts known to such officer at the time of such certification, then
or thereafter cause a Pay Out Event to occur with respect to any Series;
(vi) the Transferors shall have delivered to the Trustee, each
Rating Agency and any Series Enhancer entitled thereto pursuant to the
relevant Supplement a Tax Opinion, dated the Series Issuance Date, with
respect to such issuance; and
(vii) the Transferors' Participation Amount (excluding any
Supplemental Interest) (A) shall not be less than 2% of the total amount
of Principal Receivables, in each case as of the Series Issuance Date,
and after giving effect to such issuance and (B) the sum of the Invested
Amounts to be used in calculating the Floating Allocation Percentages of
all outstanding Series, shall not exceed the amount of Principal
Receivables to be used in calculating such Floating Allocation
Percentages, in each case as of the Series Issuance Date and after giving
effect to such issuance.
54
Upon satisfaction of the above conditions, the Trustee shall execute
the Supplement and authenticate the Investor Certificates of such Series upon
execution thereof by the Transferors.
(c) The Transferors may assign all or a portion of the Base Interest
(such assigned interest, a "Supplemental Interest"), the terms of which
Supplemental Interest shall be defined in a Supplement (which Supplement shall
be subject to Section 13.01(a) to the extent that it amends any of the terms
of this Agreement), to a Person designated by the Transferors (or by the
holder of a Supplemental Interest, in the case of an assignment thereof, as
provided below), upon satisfaction of the following conditions:
(i) the Transferors' Participation Amount (excluding any
Supplemental Interest) shall not be less than 2% of the total amount of
Principal Receivables, in each case as of the date of, and after giving
effect to, such assignment;
(ii) the Rating Agency Condition shall have been satisfied with
respect to such assignment; and
(iii) the Transferors shall have delivered to the Trustee, each
Rating Agency and any Series Enhancer entitled thereto pursuant to the
relevant Supplement a Tax Opinion, dated the date of such assignment,
with respect thereto.
Any Supplemental Interest may be assigned only upon satisfaction of the
conditions set forth in clauses (ii) and (iii) above.
(d) The Base Interest (or any interest therein) may be transferred
to a Person which is a member of the "affiliated group" of which ▇.▇. ▇▇▇▇▇▇
▇▇▇▇▇ & Co. is the "common parent" (as such terms are defined in Section
1504(a) of the Code); provided that the Transferors shall have delivered to
the Trustee, each Rating Agency and any Series Enhancer entitled thereto
pursuant to the relevant Supplement a Tax Opinion, dated the date of such
transfer, with respect thereto.
SECTION 6.04. Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at the office or agency to be
maintained in accordance with the provisions of Section 11.16 a register (the
"Certificate Register") in which, subject to such reasonable regulations as it
may prescribe, a transfer agent and registrar (which may be the Trustee) (the
"Transfer Agent and Registrar") shall provide for the registration of the
Registered Certificates and of transfers and exchanges of the Registered
Certificates as herein provided. The Transfer Agent and Registrar shall
initially be Bankers Trust Company and any co-transfer agent and co-registrar
chosen by the Transferors and acceptable to the Trustee, including, if and so
long as any Series or Class is listed on the Luxembourg Stock Exchange and
such exchange shall so require, a co-transfer agent and co-registrar in
Luxembourg. So long as any Investor Certificates are outstanding, the
Transferors shall maintain a co-transfer agent and co-registrar in New York
City. Any reference in this Agreement to the Transfer Agent and Registrar
shall include any co-transfer agent and co-registrar unless the context
requires otherwise.
The Trustee may revoke such appointment and remove any Transfer
Agent and Registrar if the Trustee determines in its sole discretion that such
Transfer Agent and ▇▇▇▇▇▇▇▇▇
▇▇
failed to perform its obligations under this Agreement in any material
respect. Any Transfer Agent and Registrar shall be permitted to resign as
Transfer Agent and Registrar upon 30 days' notice to the Transferors, the
Trustee and the Servicer; provided, however, that such resignation shall not
be effective and such Transfer Agent and Registrar shall continue to perform
its duties as Transfer Agent and Registrar until the Trustee has appointed a
successor Transfer Agent and Registrar reasonably acceptable to the
Transferors.
Subject to paragraph (c) below, upon surrender for registration of
transfer of any Registered Certificate at any office or agency of the Transfer
Agent and Registrar maintained for such purpose, one or more new Registered
Certificates (of the same Series and Class) in authorized denominations of
like aggregate fractional undivided interests in the Certificateholders'
Interest shall be executed, authenticated and delivered, in the name of the
designated transferee or transferees.
At the option of a Registered Certificateholder, Registered
Certificates (of the same Series and Class) may be exchanged for other
Registered Certificates of authorized denominations of like aggregate
fractional undivided interests in the Certificateholders' Interest, upon
surrender of the Registered Certificates to be exchanged at any such office or
agency; Registered Certificates, including Registered Certificates received in
exchange for Bearer Certificates, may not be exchanged for Bearer
Certificates. At the option of the Holder of a Bearer Certificate, subject to
applicable laws and regulations, Bearer Certificates may be exchanged for
other Bearer Certificates or Registered Certificates (of the same Series and
Class) of authorized denominations of like aggregate fractional undivided
interests in the Certificateholders, Interest, upon surrender of the Bearer
Certificates to be exchanged at an office or agency of the Transfer Agent and
Registrar located outside the United States. Each Bearer Certificate
surrendered pursuant to this Section shall have attached thereto all unmatured
Coupons; provided that any Bearer Certificate, so surrendered after the close
of business on the Record Date preceding the relevant payment date or
distribution date after the expected final payment date need not have attached
the Coupon relating to such payment date or distribution date (in each case,
as specified in the applicable Supplement).
Whenever any Investor Certificates are so surrendered for exchange,
the Transferors shall execute, the Trustee shall authenticate and the Transfer
Agent and Registrar shall deliver (in the case of Bearer Certificates, outside
the United States) the Investor Certificates which the Investor
Certificateholder making the exchange is entitled to receive. Every Investor
Certificate presented or surrendered for registration of transfer or exchange
shall be accompanied by a written instrument of transfer in a form
satisfactory to the Trustee or the Transfer Agent and Registrar duly executed
by the Investor Certificateholder or the attorney-in-fact thereof duly
authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Investor Certificates, but the Transfer Agent and Registrar may
require payment of a sum sufficient to cover any tax or governmental charge
that may be imposed in connection with any such transfer or exchange.
All Investor Certificates (together with any Coupons) surrendered
for registration of transfer and exchange or for payment shall be canceled and
disposed of in a manner
56
satisfactory to the Trustee. The Trustee shall cancel and destroy any Global
Certificate upon its exchange in full for Definitive Euro-Certificates and
shall deliver a Certificate of destruction to the Transferors. Such
certificate shall also state that a certificate or certificates of a Foreign
Clearing Agency to the effect referred to in Section 6.13 was received with
respect to each portion of the Global Certificate exchanged for Definitive
Euro-Certificates.
The Transferors shall execute and deliver to the Trustee Bearer
Certificates and Registered Certificates in such amounts and at such times as
are necessary to enable the Trustee to fulfill its responsibilities under this
Agreement, each Supplement and the Certificates.
(b) The Transfer Agent and Registrar will maintain at its expense in
each of the Borough of Manhattan, The City of New York, and, if and so long as
any Series or Class is listed on the Luxembourg Stock Exchange, Luxembourg, an
office or agency where Investor Certificates may be surrendered for
registration of transfer or exchange (except that Bearer Certificates may not
be surrendered for exchange at any such office or agency in the United
States).
(c) (i) Registration of transfer of Investor Certificates containing
a legend substantially to the effect set forth on Exhibit E-1 shall be
effected only if such transfer (x) is made pursuant to an effective
registration statement under the Act, or is exempt from the registration
requirements under the Act, and (y) is made to a Person which is not an
employee benefit plan, trust or account, including an individual retirement
account, that is subject to ERISA or that is described in Section 4975(e)(1)
of the Code or an entity whose underlying assets include plan assets by reason
of a plan's investment in such entity (a "Benefit Plan"). In the event that
registration of a transfer is to be made in reliance upon an exemption from
the registration requirements under the Act, the transferor or the transferee
shall deliver, at its expense, to the Transferors, the Servicer and the
Trustee, an investment letter from the transferee, substantially in the form
of the investment and ERISA representation letter attached hereto as Exhibit
E-2, and no registration of transfer shall be made until such letter is so
delivered.
Investor Certificates issued upon registration or transfer of, or
investor Certificates issued in exchange for, Investor Certificates bearing
the legend referred to above shall also bear such legend unless the
Transferors, the Servicer, the Trustee and the Transfer Agent and Registrar
receive an opinion of counsel, satisfactory to each of them, to the effect
that such legend may be removed.
Whenever an Investor Certificate containing the legend referred to
above is presented to the Transfer Agent and Registrar for registration of
transfer, the Transfer Agent and Registrar shall promptly seek instructions
from the Servicer regarding such transfer and shall be entitled to receive
instructions signed by a Servicing officer prior to registering any such
transfer. The Transferors hereby agree to indemnify the Transfer Agent and
Registrar and the Trustee and to hold each of them harmless against any loss,
liability or expense incurred without negligence or bad faith on their part
arising out of or in connection with actions taken or omitted by them in
relation to any such instructions furnished pursuant to this clause (i).
57
(ii) Registration of transfer of Investor Certificates containing a
legend to the effect set forth on Exhibit E-3 shall be effected only if
such transfer is made to a Person which is not a Benefit Plan. By
accepting and holding any such Investor Certificate, an Investor
Certificateholder shall be deemed to have represented and warranted that
it is not a Benefit Plan. By acquiring any interest in a Book-Entry
Certificate which contains such legend, a Certificate Owner shall be
deemed to have represented and warranted that it is not a Benefit Plan.
(iii) If so requested by the Transferors, the Trustee will make
available to any prospective purchaser of Investor Certificates who so
requests, a copy of a letter provided to the Trustee by or on behalf of
the Transferor relating to the transferability of any Series or Class to
a Benefit Plan.
SECTION 6.05. Mutilated, Destroyed, Lost or Stolen Certificates. If
(a) any mutilated Certificate (together, in the case of Bearer Certificates,
with all unmatured Coupons (if any) appertaining thereto) is surrendered to
the Transfer Agent and Registrar, or the Transfer Agent and Registrar receives
evidence to its satisfaction of the destruction, loss or theft of any
Certificate and (b) there is delivered to the Transfer Agent and Registrar and
the Trustee such security or indemnity as may be required by them to save each
of them harmless, then, in the absence of notice to the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Transferors shall
execute, the Trustee shall authenticate and the Transfer Agent and Registrar
shall deliver (in the case of Bearer Certificates, outside the United States),
in exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like tenor and aggregate fractional
undivided interest. In connection with the issuance of any new Certificate
under this Section, the Trustee or the Transfer Agent and Registrar may
require the payment by the Certificateholder of a sum sufficient to cover any
tax or other governmental charge that may be imposed in relation thereto and
any other expenses (including the fees and expenses of the Trustee and
Transfer Agent and Registrar) connected therewith. Any duplicate Certificate
issued pursuant to this Section shall constitute complete and indefeasible
evidence of ownership in the Trust, as if originally issued, whether or not
the lost, stolen or destroyed Certificate shall be found at any time.
SECTION 6.06. Persons Deemed Owners. The Trustee, the Transferors,
the Servicer, the Paying Agent, the Transfer Agent and Registrar and any agent
of any of them may (a) prior to due presentation of a Registered Certificate
for registration of transfer, treat the Person in whose name any Registered
Certificate is registered as the owner of such Registered Certificate for the
purpose of receiving distributions pursuant to the terms of the applicable
Supplement and for all other purposes whatsoever, and (b) treat the bearer of
a Bearer Certificate or Coupon as the owner of such Bearer Certificate or
Coupon for the purpose of receiving distributions pursuant to the terms of the
applicable Supplement and for all other purposes whatsoever; and, in any such
case, neither the Trustee, the Transferors, the Servicer, the Paying Agent,
the Transfer Agent and Registrar nor any agent of any of them shall be
affected by any notice to the contrary. Notwithstanding the foregoing, in
determining whether the Holders of the requisite Investor Certificates have
given any request, demand, authorization, direction, notice, consent or waiver
hereunder, Certificates owned by any of the Transferors, the Servicer, any
other Holder of the Transferors' Interest, the Trustee or any Affiliate
thereof, shall be disregarded and deemed not to be outstanding, except that,
in determining whether the Trustee
58
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Certificates which the Trustee
actually knows to be so owned shall be so disregarded. Certificates so owned
which have been pledged in good faith shall not be disregarded and may be
regarded as outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Certificates and
that the pledgee is not any Transferor, the Servicer, any other Holder of the
Transferors' Interest or any Affiliate thereof.
SECTION 6.07. Appointment of Paying Agent. The Paying Agent shall
make distributions to investor Certificateholders from the Collection Account
or any applicable Series Account pursuant to the provisions of the applicable
Supplement and shall report the amounts of such distributions to the Trustee.
Any Paying Agent shall have the revocable power to withdraw funds from the
Collection Account or any applicable Series Account for the purpose of making
the distributions referred to above. The Trustee may revoke such power and
remove the Paying Agent if the Trustee determines in its sole discretion that
the Paying Agent shall have failed to perform its obligations under this
Agreement or any Supplement in any material respect. The Paying Agent shall
initially be Bankers Trust Company and any co-paying agent chosen by the
Transferors and acceptable to the Trustee, including, if and so long as any
Series or Class is listed on the Luxembourg Stock Exchange and such exchange
so requires, a co-paying agent in Luxembourg or another western European city.
Any Paying Agent shall be permitted to resign as Paying Agent upon 30 days'
notice to the Trustee and the Transferors. In the event that any Paying Agent
shall resign, the Trustee shall appoint a successor to act as Paying Agent.
The Trustee shall cause each successor or additional Paying Agent to execute
and deliver to the Trustee an instrument in which such successor or additional
Paying Agent shall agree with the Trustee that it will hold all sums, if any,
held by it for payment to the Investor Certificateholders in trust for the
benefit of the Investor Certificateholders entitled thereto until such sums
shall be paid to such Investor Certificateholders. The Paying Agent shall
return all unclaimed funds to the Trustee and upon removal shall also return
all funds in its possession to the Trustee. The provisions of Sections 11.01,
11.02, 11.03 and 11.05 shall apply to the Trustee also in its role as Paying
Agent, for so long as the Trustee shall act as Paying Agent. Any reference in
this Agreement to the Paying Agent shall include any co-paying agent unless
the context requires otherwise.
SECTION 6.08. Access to List of Registered Certificateholders'
Names and Addresses. The Trustee will furnish or cause to be furnished by the
Transfer Agent and Registrar to the Servicer, the Transferors or the Paying
Agent, within five Business Days after receipt by the Trustee of a request
therefor, a list in such form as the Servicer, the Transferors or the Paying
Agent may reasonably require, of the names and addresses of the Registered
Certificateholders. If any Holder or group of Holders of Investor Certificates
of any Series or all outstanding Series, as the case may be, evidencing not
less than 10% of the aggregate unpaid principal amount of such Series or all
outstanding Series, as applicable (the "Applicants"), apply to the Trustee,
and such application states that the Applicants desire to communicate with
other Investor Certificateholders with respect to their rights under this
Agreement or any Supplement or under the Investor Certificates and is
accompanied by a copy of the communication which such Applicants propose to
transmit, then the Trustee, after having been adequately indemnified by such
Applicants for its costs and expenses, shall afford or shall cause the
Transfer Agent and Registrar to afford such Applicants access during normal
business hours to the most recent list of
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Registered Certificateholders of such Series or all outstanding Series, as
applicable, held by the Trustee, within five Business Days after the receipt
of such application. Such list shall be as of a date no more than 45 days
prior to the date of receipt of such Applicants' request.
Every Registered Certificateholder, by receiving and holding a
Registered Certificate, agrees with the Trustee that neither the Trustee, the
Servicer, the Transferors, the Transfer Agent and Registrar, nor any of their
respective agents, shall be held accountable by reason of the disclosure of
any such information as to the names and addresses of the Registered
Certificateholders hereunder, regardless of the sources from which such
information was derived.
SECTION 6.09. Authenticating Agent. (a) The Trustee may appoint
one or more authenticating agents with respect to the Certificates which shall
be authorized to act on behalf of the Trustee in authenticating the
Certificates in connection with the issuance, delivery, registration of
transfer, exchange or repayment of the Certificates. Whenever reference is
made in this Agreement to the authentication of Certificates by the Trustee or
the Trustee's certificate of authentication, such reference shall be deemed to
include authentication on behalf of the Trustee by an authenticating agent and
certificate of authentication executed on behalf of the Trustee by an
authenticating agent. Each authenticating agent must be acceptable to the
Transferors and the Servicer.
(b) Any institution succeeding to the corporate agency business of
an authenticating agent shall continue to be an authenticating agent without
the execution or filing of any power or any further act on the part of the
Trustee or such authenticating agent. An authenticating agent may at any time
resign by giving notice of resignation to the Trustee and to the Transferors.
The Trustee may at any time terminate the agency of an authenticating agent by
giving notice of termination to such authenticating agent and to the
Transferors. Upon receiving such a notice of resignation or upon such a
termination, or in case at any time an authenticating agent shall cease to be
acceptable to the Trustee or the Transferors, the Trustee promptly may appoint
a successor authenticating agent. Any successor authenticating agent upon
acceptance of its appointment hereunder shall become vested with all the
rights, powers and duties or its predecessor hereunder, with like effect as if
originally named as an authenticating agent. No successor authenticating agent
shall be appointed unless acceptable to the Trustee and the Transferors. The
Transferors agree to pay to each authenticating agent from time to time
reasonable compensation for its services under this Section. The provisions of
Sections 11.01, 11.02 and 11.03 shall be applicable to any authenticating
agent.
(c) Pursuant to an appointment made under this Section, the
Certificates may have endorsed thereon, in lieu of the Trustee's certificate
of authentication, an alternate certificate of authentication in substantially
the following form:
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This is one of the Certificates described in the Pooling and
Servicing Agreement.
----------------------------------------
as Authenticating Agent
for the Trustee,
by
------------------------------------
Authorized Officer
SECTION 6.10. Book-Entry Certificates. Unless otherwise specified
in the related Supplement for any Series or Class, the Investor Certificates,
upon original issuance, shall be issued in the form of one or more typewritten
Investor Certificates representing the Book-Entry Certificates, to be
delivered to the Clearing Agency, by, or on behalf of, the Transferors. The
Investor Certificates shall initially be registered on the Certificate
Register in the name of the Clearing Agency or its nominee, and no Certificate
Owner will receive a definitive certificate representing such Certificate
Owner's interest in the Investor certificates, except as provided in Section
6.12. Unless and until definitive, fully registered Investor Certificates
("Definitive Certificates") have been issued to the applicable Certificate
owners pursuant to Section 6.12 or as otherwise specified in any such
Supplement:
(a) the provisions of this Section shall be in full force and
effect;
(b) the Transferors, the Servicer and the Trustee may deal with the
Clearing Agency and the Clearing Agency Participants for all purposes
(including the making of distributions) as the authorized representatives of
the respective Certificate Owners;
(c) to the extent that the provisions of this Section conflict with
any other provisions of this Agreement, the provisions of this Section shall
control; and
(d) the rights of the respective Certificate Owners shall be
exercised only through the Clearing Agency and the Clearing Agency
Participants and shall be limited to those established by law and agreements
between such Certificate Owners and the Clearing Agency and/or the Clearing
Agency Participants. Pursuant to the Depository Agreement, unless and until
Definitive Certificates are issued pursuant to Section 6.12, the Clearing
Agency will make book-entry transfers among the Clearing Agency Participants
and receive and transmit distributions of principal and interest on the
related Investor Certificates to such Clearing Agency Participants.
For purposes of any provision of this Agreement requiring or
permitting actions with the consent of, or at the direction of, Investor
Certificateholders evidencing a specified percentage of the aggregate unpaid
principal amount of Investor Certificates, such direction or consent may be
given by Certificate Owners (acting through the Clearing Agency and the
Clearing Agency Participants) owning Investor Certificates evidencing the
requisite percentage of principal amount of Investor Certificates.
SECTION 6.11. Notices to Clearing Agency. Whenever any notice or
other communication is required to be given to Investor Certificateholders of
any Series or Class with respect to which Book-Entry Certificates have been
issued, unless and until Definitive
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Certificates shall have been issued to the related Certificate owners, the
Trustee shall give all such notices and communications to the applicable
Clearing Agency.
SECTION 6.12. Definitive Certificates. If Book-Entry Certificates
have been issued with respect to any Series or Class and (a) the Transferors
advise the Trustee that the Clearing Agency is no longer willing or able to
discharge properly its responsibilities under the Depository Agreement with
respect to such Series or Class and the Trustee or the Transferors are unable
to locate a qualified successor, (b) the Transferors, at their option, advise
the Trustee that they elect to terminate the book-entry system with respect to
such Series or Class through the Clearing Agency or (c) after the occurrence
of a Servicer Default, Certificate owners of such Series or Class evidencing
not less than 50% of the aggregate unpaid principal amount of such Series or
Class advise the Trustee and the Clearing Agency through the Clearing Agency
Participants that the continuation of a book-entry system with respect to the
Investor Certificates of such Series or Class through the Clearing Agency is
no longer in the best interests of the Certificate owners with respect to such
Certificates, then the Trustee shall notify all Certificate owners of such
Certificates, through the Clearing Agency, of the occurrence of any such event
and of the availability of Definitive Certificates to Certificate owners
requesting the same. Upon surrender to the Trustee of any such Certificates by
the Clearing Agency, accompanied by registration instructions from the
Clearing Agency for registration, the Transferors shall execute and the
Trustee shall authenticate and deliver such Definitive Certificates. Neither
the Transferors nor the Trustee shall be liable for any delay in delivery of
such instructions and may conclusively rely on, and shall be protected in
relying on, such instructions. Upon the issuance of such Definitive
Certificates all references herein to obligations imposed upon or to be
performed by the Clearing Agency shall be deemed to be imposed upon and
performed by the Trustee, to the extent applicable with respect to such
Definitive Certificates and the Trustee shall recognize the Holders of such
Definitive Certificates as Investor Certificateholders hereunder.
SECTION 6.13. Global Certificate; Exchange Date. (a) If specified
in the related Supplement for any Series or Class, the Investor Certificates
for such Series or Class will initially be issued in the form of a single
temporary global Certificate (the "Global Certificate") in bearer form,
without interest coupons, in the denomination of the entire aggregate
principal amount of such Series or Class and substantially in the form set
forth in the exhibit with respect thereto attached to the related Supplement.
The Global Certificate will be executed by the Transferors and authenticated
by the Trustee upon the same conditions, in substantially the same manner and
with the same effect as the Definitive Certificates. The Global Certificate
may be exchanged an described below for Bearer or Registered Certificates in
definitive form (the "Definitive Euro-Certificates").
(b) The Manager shall, upon its determination of the date of
completion of the distribution of the Investor Certificates of such Series or
Class, so advise the Trustee, the Transferors, the Depositaries, and each
Foreign Clearing Agency forthwith. Without unnecessary delay, but in any event
not prior to the Exchange Date, the Transferors will execute and deliver to
the Trustee at its London office or its designated agent outside the United
States definitive Bearer Certificates in an aggregate principal amount equal
to the entire aggregate principal amount of such Series or Class. All Bearer
Certificates so issued and delivered will have Coupons attached. The Global
Certificate may be exchanged for an equal aggregate principal amount of
Definitive Euro-Certificates only on or after the Exchange Date. An
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institutional investor that is a U.S. Person may exchange the portion of the
Global Certificate beneficially owned by it only for an equal aggregate
principal amount of Registered Certificates bearing the applicable legend set
forth in the form of Registered Certificate attached to the related Supplement
and having a minimum denomination of $500,000, which may be in temporary form
if the Transferors so elect. The Transferors may waive the $500,000 minimum
denomination requirement if they so elect. Upon any demand for exchange for
Definitive Euro-Certificates in accordance with this paragraph, the
Transferors shall cause the Trustee to authenticate and deliver the Definitive
Euro-Certificates to the Holder (x) outside the United States, in the case of
Bearer Certificates, and (y) according to the instructions of the Holder, in
the case of Registered certificates, but in either case only upon presentation
to the Trustee of a written statement substantially in the form of Exhibit G-1
with respect to the Global Certificate or portion thereof being exchanged
signed by a Foreign Clearing Agency and dated on the Exchange Date or a
subsequent date, to the effect that it has received in writing or by tested
telex a certification substantially in the form of (i) in the case of
beneficial ownership of the Global Certificate or a portion thereof being
exchanged by a United States institutional investor pursuant to the second
preceding sentence, the certificate in the form of Exhibit G-2 signed by the
Manager which sold the relevant Certificates or (ii) in all other cases, the
certificate in the form of Exhibit G-3, the certificate referred to in this
clause (ii) being dated on the earlier of the first actual payment of interest
in respect of such Certificates and the date of the delivery of such
Certificate in definitive form. Upon receipt of such certification, the
Trustee shall cause the Global Certificate to be endorsed in accordance with
paragraph (d) below. Any exchange as provided in this Section shall be made
free of charge to the holders and the beneficial owners of the Global
Certificate and to the beneficial owners of the Definitive Euro-Certificates
issued in exchange, except that a person receiving Definitive
Euro-Certificates must bear the cost of insurance, postage, transportation and
the like in the event that such person does not receive such Definitive
Euro-Certificates in person at the offices of a Foreign Clearing Agency.
(c) The delivery to the Trustee by a Foreign Clearing Agency of any
written statement referred to above may be relied upon by the Transferors and
the Trustee as conclusive evidence that a corresponding certification or
certifications has or have been delivered to such Foreign Clearing Agency
pursuant to the terms of this Agreement.
(d) Upon any such exchange of all or a portion of the Global
Certificate for a Definitive Euro-Certificate or Certificates, such Global
Certificate shall be endorsed by or on behalf of the Trustee to reflect the
reduction of its principal amount by an amount equal to the aggregate
principal amount of such Definitive Euro-Certificate or Certificates. Until so
exchanged in full, such Global Certificate shall in all respects be entitled
to the same benefits under this Agreement as Definitive Euro-Certificates
authenticated and delivered hereunder except that the beneficial owners of
such Global Certificate shall not be entitled to receive payments of interest
on the Certificates until they have exchanged their beneficial interests in
such Global Certificate for Definitive Euro-Certificates.
SECTION 6.14. Meetings of Certificateholders. (a) If at the time
any Bearer Certificates are issued and outstanding with respect to any Series
or Class to which any meeting described below relates, the Servicer, the
Transferors, or the Trustee may at any time call a meeting of Investor
Certificateholders of any Series or Class or of all Series, to be held at such
time and at such place as the Servicer, Transferors or the Trustee, as the
case may be, shall
63
determine, for the purpose of approving a modification of or amendment to, or
obtaining a waiver of any covenant or condition set forth in, this Agreement,
any Supplement or the Investor Certificates or of taking any other action
permitted to be taken by Investor Certificateholders hereunder or under any
Supplement. Notice of any meeting of Investor Certificateholders, setting
forth the time and place of such meeting and in general terms the action
proposed to be taken at such meeting, shall be given in accordance with
Section 13.05, the first mailing and publication to be not less than 20 nor
more than 180 days prior to the date fixed for the meeting. To be entitled to
vote at any meeting of Investor Certificateholders a person shall be (i) a
Holder of one or more Investor Certificates of the applicable Series or Class
or (ii) a person appointed by an instrument in writing as proxy by the Holder
of one or more such Investor Certificates. The only persons who shall be
entitled to be present or to speak at any meeting of Investor
Certificateholders shall be the persons entitled to vote at such meeting and
their counsel and any representatives of the Transferors, the Servicer and the
Trustee and their respective counsel.
(b) At a meeting of Investor Certificateholders, persons entitled to
vote Investor Certificates evidencing a majority of the aggregate unpaid
principal amount of the applicable Series or Class or all outstanding Series,
as the case may be, shall constitute a quorum. No business shall be transacted
in the absence of a quorum, unless a quorum is present when the meeting is
called to order. In the absence of a quorum at any such meeting, the meeting
may be adjourned for a period of not less than 10 days; in the absence of a
quorum at any such adjourned meeting, such adjourned meeting may be further
adjourned for a period of not less than 10 days; at the reconvening of any
meeting further adjourned for lack of a quorum, the persons entitled to vote
Investor Certificates evidencing at least 25% of the aggregate unpaid
principal amount of the applicable Series or Class or all outstanding Series,
as the case may be, shall constitute a quorum for the taking of any action set
forth in the notice of the original meeting. Notice of the reconvening of any
adjourned meeting shall be given as provided above except that such notice
must be given not less than five days prior to the date on which the meeting
is scheduled to be reconvened. Notice of the reconvening of an adjourned
meeting shall state expressly the percentage of the aggregate principal amount
of the outstanding applicable Investor Certificates which shall constitute a
quorum.
(c) Any Investor Certificateholder who has executed an instrument in
writing appointing a person as proxy shall be deemed to be present for the
purposes of determining a quorum and be deemed to have voted; provided that
such Investor Certificateholder shall be considered as present or voting only
with respect to the matters covered by such instrument in writing. Subject to
the provisions of Section 13.01, any resolution passed or decision taken at
any meeting of Investor Certificateholders duly held in accordance with this
Section shall be binding on all Investor Certificateholders whether or not
present or represented at the meeting.
(d) The holding of Bearer Certificates shall be proved by the
production of such Bearer Certificates or by a certificate, satisfactory to
the Servicer, executed by any bank, trust company or recognized securities
dealer, wherever situated, satisfactory to the Servicer. Each such certificate
shall be dated and shall state that on the date thereof a Bearer Certificate
bearing a specified serial number was deposited with or exhibited to such
bank, trust company or recognized securities dealer by the person named in
such certificate. Any such certificate may be issued in respect of one or more
Bearer Certificates specified therein. The holding by the person named in any
such certificate of any Bearer Certificate specified therein shall be presumed
to
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continue for a period of one year from the date of such certificate unless
at the time of any determination of such holding (i) another certificate
bearing a later date issued in respect of the same Bearer Certificate shall be
produced, (ii) the Bearer Certificate specified in such certificate shall be
produced by some other person or (iii) the Bearer Certificate specified in
such certificate shall have ceased to be outstanding. The appointment of any
proxy shall be proved by having the signature of the person executing the
proxy guaranteed by any bank, trust company or recognized securities dealer
satisfactory to the Trustee.
(e) The Trustee shall appoint a temporary chairman of the meeting. A
permanent chairman and a permanent secretary of the meeting shall be elected
by vote of the holders of Investor Certificates evidencing a majority of the
aggregate unpaid principal amount of Investor Certificates of the applicable
Series or Class or all outstanding Series, as the case may be, represented at
the meeting. No vote shall be cast or counted at any meeting in respect of any
Investor Certificate challenged as not outstanding and ruled by the chairman
of the meeting to be not outstanding. The chairman of the meeting shall have
no right to vote except as an Investor Certificateholder or proxy. Any meeting
of Investor Certificateholders duly called at which a quorum is present may be
adjourned from time to time, and the meeting may be held as so adjourned
without further notice.
(f) The vote upon any resolution submitted to any meeting of
Investor Certificateholders shall be by written ballot on which shall be
subscribed the signatures of Investor Certificateholders or proxies and on
which shall be inscribed the serial number or numbers of the Investor
Certificates held or represented by them. The permanent chairman of the
meeting shall appoint two inspectors of votes who shall count all votes cast
at the meeting for or against any resolution and who shall make and file with
the secretary of the meeting their verified written reports in duplicate of
all votes cast at the meeting. A record in duplicate of the proceedings of
each meeting of Investor Certificateholders shall be prepared by the secretary
of the meeting, and there shall be attached to said record the original
reports of the inspectors of votes on any vote by ballot taken thereat and
affidavits by one or more persons having knowledge of the facts setting forth
a copy of the notice of the meeting and showing that said notice was published
as provided above. The record shall be signed and verified by the permanent
chairman and secretary of the meeting and one of the duplicates shall be
delivered to the Servicer and the other to the Trustee to be preserved by the
Trustee, the latter to have attached thereto the ballots voted at the meeting.
Any record so signed and verified shall be conclusive evidence of the matters
therein stated.
ARTICLE VII
OTHER MATTERS RELATING TO THE TRANSFERORS
SECTION 7.01. Liability of the Transferors. Each Transferor
(including any Additional Transferors) shall be severally, and not jointly,
liable in all respects for the obligations, covenants, representations and
warranties undertaken by it pursuant to this Agreement or any Supplement and
shall not be liable for the obligations, covenants, representations and
warranties of any other Transferor. A Transferor shall be liable only to the
extent of the obligations specifically undertaken by it in its capacity as
Transferor.
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SECTION 7.02. Merger or Consolidation of, or Assumption of the
Obligations of, the Transferors. (a) None of the Transferors shall consolidate
with or merge into any other corporation or convey or transfer its properties
and assets substantially as an entirety to any Person unless:
(i) (x) the entity formed by such consolidation or into which such
Transferor is merged or the Person which acquires by conveyance or
transfer the properties and assets of such Transferor substantially as an
entirety shall be, if such Transferor is not the surviving entity, a
corporation or limited liability company organized and existing under the
laws of the United States of America or any State or the District of
Columbia, and shall be
(A) a savings and loan association, a national banking
association, a bank or other entity which is not subject to
Title 11 of the United States Code; or
(B) a wholly-owned subsidiary of an entity referred to in
clause (A) that is a special purpose entity whose powers and
activities are limited to substantially the same powers and
activities and are subject to substantially the same
restrictions as provided in the Limited Liability Company
Agreement; and
if such Transferor is not the surviving entity, such corporation or other
entity shall expressly assume, by an agreement supplemental hereto,
executed and delivered to the Trustee, in form satisfactory to the
Trustee, the performance of every covenant and obligation of such
Transferor hereunder, including its obligations under Section 7.04; and
(y) such Transferor has delivered to the Trustee an Officer's Certificate
and an Opinion of Counsel each stating that such consolidation, merger,
conveyance or transfer and such supplemental agreement comply with this
Section, that such supplemental agreement is a valid and binding
obligation of such surviving entity enforceable against such surviving
entity in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws affecting creditors' rights generally from time to
time in effect and except as such enforceability may be limited by
general principles of equity (whether considered in a suit at law or in
equity), and that all conditions precedent herein provided for relating
to such transaction have been complied with;
(ii) the Rating Agency Condition shall have been satisfied with
respect thereto; and
(iii) the relevant Transferor shall have delivered to the Trustee,
each Rating Agency and any Series Enhancer entitled thereto pursuant to
the relevant Supplement a Tax Opinion, dated the date of such
consolidation, merger, conveyance or transfer, with respect thereto.
66
(b) The obligations of the Transferors hereunder shall not be
assignable nor shall any Person succeed to the obligations of the Transferors
hereunder except in each case in accordance with the provisions of Section
7.02(a) or (c).
(c) Notwithstanding anything to the contrary in this Agreement, in
connection with a sale of the Accounts, the Transferor may transfer all of its
right, title and interest in the Transferors' Interest pursuant to a
supplemental agreement (which supplemental agreement shall be subject to
Section 13.01(a) to the extent that it amends any of the terms of this
Agreement or any Supplement), to the Person purchasing such Accounts or to a
wholly-owned subsidiary of such Person, upon satisfaction of the following
conditions:
(i) (x) the transferee of such Transferor's right, title and
interest in the Transferors' Interest shall be a corporation or other
entity organized and existing under the laws of the United States of
America or any State or the District of Columbia, and shall expressly
assume, by an agreement supplemental hereto, executed and delivered to
the Trustee, in form satisfactory to the Trustee, the performance of
every covenant and obligation of such Transferor hereunder, including its
obligations under Section 7.04; and (y) such Transferor shall have
delivered to the Trustee an Officer's Certificate and an Opinion of
Counsel each stating that such transfer of the Transferors' Interest and
such supplemental agreement comply with this Section, that such
supplemental agreement is a valid and binding obligation of such
transferee enforceable against such transferee in accordance with its
terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally from time to time in effect and
except as such enforceability may be limited by general principles of
equity (whether considered in a suit at law or in equity), and that all
conditions precedent herein provided for relating to such transfer have
been complied with;
(ii) the Rating Agency Condition shall have been satisfied with
respect to such transfer and assumption; and
(iii) such Transferor shall have delivered to the Trustee, each
Rating Agency and any Series Enhancer entitled thereto pursuant to the
relevant Supplement a Tax Opinion, dated the date of such transfer, with
respect to such transfer.
SECTION 7.03. Limitations on Liability of the Transferors. Subject
to Sections 7.01 and 7.04, none of the Transferors nor any of the directors,
officers, employees or agents of any of the Transferors acting in their
capacities as Transferors shall be under any liability to the Trust, the
Trustee, the Servicer, the Certificateholders, any Series Enhancer or any
other Person for any action taken or for refraining from the taking of any
action in good faith in their capacities as Transferors pursuant to this
Agreement; provided, however, that this provision shall not protect any
Transferor or any such Person against any liability which would otherwise be
imposed by reason of wilful misfeasance, bad faith or gross negligence in the
performance of duties or by reason of reckless disregard of obligations and
duties hereunder. Each Transferor and any director, officer, employee or agent
of any of the Transferors may rely in good faith on any document of any kind
prima facie properly executed and submitted by any Person (other than such
Transferor) respecting any matters arising hereunder.
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SECTION 7.04. Liabilities. Notwithstanding Section 7.03 (and
notwithstanding Sections 8.03 and 8.04), by entering into this Agreement, each
Transferor agrees to be liable, directly to the injured party, for the entire
amount of any losses, claims, damages or liabilities (other than those
incurred by an Investor Certificateholder in the capacity of an investor in
the Investor Certificates or those which arise from any action by any Investor
Certificateholder) arising out of or based on the arrangement created by this
Agreement (to the extent Trust Assets remaining after the Investor
Certificateholders and Series Enhancers have been paid in full are
insufficient to pay such losses, claims, damages or liabilities) and the
actions of the Servicer taken pursuant hereto. In the event of the appointment
of a Successor Servicer, the Successor Servicer will (from its own assets and
not from the assets of the Trust) indemnify and hold harmless the Transferors
against and from any losses, claims, damages and liabilities of the
Transferors as described in this Section arising from the actions or omissions
of such Successor Servicer.
ARTICLE VIII
OTHER MATTERS RELATING TO THE SERVICER
SECTION 8.01. Liability of the Servicer. The Servicer shall be
liable under this Article only to the extent of the obligations specifically
undertaken by the Servicer in its capacity as Servicer.
SECTION 8.02. Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer. The Servicer shall not consolidate with or merge
into any other corporation or convey or transfer its properties and assets
substantially as an entirety to any Person, unless:
(a) (i) the corporation formed by such consolidation or into which
the Servicer is merged or the Person which acquires by conveyance or transfer
the properties and assets of the Servicer substantially as an entirety shall
be, if the Servicer is not the surviving entity, a corporation organized and
existing under the laws of the United States of America or any State or the
District of Columbia, and shall be a savings and loan association, a national
banking association, a bank or other entity which is not subject to Title 11
of the United States Code and, if the Servicer is not the surviving entity,
such corporation shall expressly assume, by an agreement supplemental hereto,
executed and delivered to the Trustee, in form satisfactory to the Trustee,
the performance of every covenant and obligation of the Servicer hereunder;
(ii) the Servicer has delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel each stating that such
consolidation, merger, conveyance or transfer and such supplemental
agreement comply with this Section, that such supplemental agreement is a
valid and binding obligation of such surviving entity enforceable against
such surviving entity in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors'
rights generally from time to time in effect and except as such
enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity), and that all conditions
precedent herein provided for relating to such transaction have been
complied with;
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(b) the Servicer shall have delivered notice to each Rating Agency
of such consolidation, merger, conveyance or transfer; and
(c) the corporation formed by such consolidation or into which the
Servicer is merged or the Person which acquires by conveyance or transfer the
properties and assets of the Servicer substantially as an entirety shall be an
Eligible Servicer.
(d) Notwithstanding anything to the contrary in this Agreement, in
connection with a transfer of a Transferor's right, title and interest in the
Transferors' Interest pursuant to Section 7.02(c), the Servicer, if it is such
Transferor or an Affiliate of such Transferor, may resign, and such transferee
may appoint itself or one of its Affiliates to be successor Servicer pursuant
to and subject to the following conditions:
(i) such successor Servicer shall be a corporation or other
entity organized and existing under the laws of the United States of
America or any State or the District of Columbia, having an
investment grade long-term unsecured debt rating from a nationally
recognized statistical rating agency, and shall expressly assume, by
an agreement supplemental hereto, executed and delivered to the
Trustee, in form satisfactory to the Trustee, the performance of
every covenant and obligation of the Servicer hereunder;
(ii) the resigning Servicer shall have delivered to the Trustee
an Officer's Certificate and an Opinion of Counsel each stating that
such resignation and appointment and such supplemental agreement
comply with this Section, that such supplemental agreement is a
valid and binding obligation of such successor Servicer enforceable
against such successor Servicer in accordance with its terms, except
as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws
affecting creditors' rights generally from time to time in effect
and except as such enforceability may be limited by general
principles of equity (whether considered in a suit at law or in
equity), and that all conditions precedent herein provided for
relating to such transaction have been complied with;
(iii) the Rating Agency Condition shall have been satisfied
with respect to such resignation and appointment; and
(iv) such successor Servicer shall be an Eligible Servicer.
No such resignation of a Servicer shall become effective until such
successor Servicer shall have assumed the responsibilities and
obligations of the Servicer in accordance with this Section.
SECTION 8.03. Limitation on Liability of the Servicer and Others.
Except as provided in Section 8.04, neither the Servicer nor any of the
directors, officers, employees or agents of the Servicer in its capacity as
Servicer shall be under any liability to the Trust, the Trustee, the
Transferors, the Certificateholders, any Series Enhancer or any other person
for any action taken or for refraining from the taking of any action in good
faith in its capacity as Servicer pursuant to this Agreement; provided,
however, that this provision shall not protect the Servicer or any such Person
against any liability which would otherwise be imposed by reason of
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wilful misfeasance, bad faith or gross negligence in the performance of duties
or by reason of reckless disregard of obligations and duties hereunder. The
Servicer and any director, officer, employee or agent of the Servicer may rely
in good faith on any document of any kind prima facie properly executed and
submitted by any Person (other than the Servicer) respecting any matters
arising hereunder. The Servicer shall not be under any obligation to appear
in, prosecute or defend any legal action which is not incidental to its duties
as Servicer in accordance with this Agreement and which in its reasonable
judgment may involve it in any expense or liability. The Servicer may, in its
sole discretion, undertake any such legal action which it may deem necessary
or desirable for the benefit of the Certificateholders with respect to this
Agreement and the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder.
SECTION 8.04. Servicer Indemnification of the Trust and the
Trustee. The Servicer shall indemnify and hold harmless the Trust and the
Trustee from and against any loss, liability, expense, damage or injury
suffered or sustained by reason of any acts or omissions of the Servicer with
respect to the Trust pursuant to this Agreement, including any judgment,
award, settlement, reasonable attorneys' fees and other costs or expenses
incurred in connection with the defense of any action, proceeding or claim.
Indemnification pursuant to this Section is solely the obligation of the
Servicer and shall not be payable from the Trust Assets. The Servicer shall
not be entitled to reimbursement from the Trust Assets for payments made
pursuant to this Section.
SECTION 8.05. The Servicer Not To Resign. Except as permitted by
Section 8.02, the Servicer shall not resign from the obligations and duties
hereby imposed on it except upon determination that (i) the performance of its
duties hereunder is no longer permissible under Requirements of Law (other
than the charter and by-laws of the Servicer) and (ii) there is no reasonable
action which the Servicer could take to make the performance of its duties
hereunder permissible under such Requirements of Law. Any determination
permitting the resignation of the Servicer shall be evidenced by an Opinion of
Counsel to such effect delivered to the Trustee. No resignation shall become
effective until the Trustee or a Successor Servicer shall have assumed the
responsibilities and obligations of the Servicer in accordance with Section
10.02. If within 120 days of the date of the determination that the Servicer
may no longer act as Servicer the Trustee is unable to appoint a Successor
Servicer, the Trustee shall serve as Successor Servicer. Notwithstanding the
foregoing, the Trustee shall, if it is legally unable so to act, petition a
court of competent jurisdiction to appoint any established institution having
a net worth of not less than $50,000,000 and whose regular business includes
the servicing of "VISA" and "MasterCard" credit card accounts as the Successor
Servicer hereunder. The Trustee shall give prompt notice to each Rating Agency
and each Series Enhancer entitled thereto under the terms of the applicable
Supplement upon the appointment of a Successor Servicer.
SECTION 8.06. Access to Certain Documentation and Information
Regarding the Receivables. The Servicer shall provide to the Trustee and the
Transferors access to the documentation regarding the Accounts and the
Receivables in such cases where the Trustee or a Transferor is required in
connection with the enforcement of the rights of Certificateholders or by
applicable statutes or regulations to review such documentation, such access
being afforded without charge but only (a) upon reasonable request, (b) during
normal business hours, (c) subject to the Servicer's normal security and
confidentiality procedures and (d) at reasonably
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accessible offices in the continental United States designated by the
Servicer. Nothing in this Section shall derogate from the obligation of the
Transferors, the Trustee and the Servicer to observe any applicable law
prohibiting disclosure of information regarding the Obligors and the failure
of the Servicer to provide access as provided in this Section as a result of
such obligation shall not constitute a breach of this Section.
SECTION 8.07. Delegation of Duties. It is understood and agreed by
the parties hereto that the Servicer may delegate certain of its duties
hereunder to First Data Resources, Inc. ("FDR"), a credit card processor
located in Omaha, Nebraska and to Providian National Bank pursuant to the
Interim Processing Agreement. In the ordinary course of business, the Servicer
may at any time delegate any duties hereunder to any Person who agrees to
conduct such duties in accordance with the Lending Guidelines. Any such
delegations shall not relieve the Servicer of its liability and responsibility
with respect to such duties, and shall not constitute a resignation within the
meaning of Section 8.05. If any such delegation is to a party other than to an
Affiliate of Chase USA or FDR or is pursuant to the Interim Processing
Agreement, notification thereof shall be given to each Rating Agency and the
Trustee.
SECTION 8.08. Examination of Records. The Transferors and the
Servicer shall clearly and unambiguously indicate in their computer files or
other records that the Receivables arising in the Accounts have been conveyed
to the Trustee pursuant to this Agreement for the benefit of the
Certificateholders. The Transferors and the Servicer shall, prior to the sale
or transfer to a third party of any receivable held in its custody, examine
its computer and other records to determine that such receivable is not a
Receivable.
ARTICLE IX
PAY OUT EVENTS
SECTION 9.01. Pay Out Events. If any one of the following events
shall occur with respect to any Series:
(a) failure on the part of the Transferors (i) to make any payment
or deposit required by the terms of this Agreement or the Supplement relating
to such Series on or before the date occurring five Business Days after the
date such payment or deposit is required to be made or (ii) duly to observe or
perform any other covenants or agreements of the Transferors set forth in this
Agreement or the Supplement relating to such series, which failure has a
material adverse effect on the Investor Certificateholders of such Series and
continues unremedied for a period of 60 days after the date on which written
notice of such failure, requiring the same to be remedied, shall have been
given to the Transferors by the Trustee, or to the Transferors and the Trustee
by any Holder of an Investor Certificate; provided that in the case of a
failure by a Transferor to perform its covenants or agreements set forth in
Section 2.05 the cure periods provided in Section 2.05 shall apply and no
additional periods shall be applicable under this Section 9.01(a) and that
only a five-day cure period shall apply in the case of a failure by a
Transferor to perform its covenants set forth in Section 2.07(b) to the extent
such failure relates to the grant of a security interest or other intentional
creation of a Lien on the Receivables;
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(b) any representation or warranty made by the Transferors in this
Agreement or the Supplement relating to such Series or any information
contained in a computer file or microfiche list required to be delivered by
the Transferors pursuant to Section 2.01 or 2.08(g) shall prove to have been
incorrect in any material respect when made or when delivered, which continues
to be incorrect in any material respect for a period of 60 days after the date
on which written notice of such failure, requiring the same to be remedied,
shall have been given to the Transferors by the Trustee, or to the Transferors
and the Trustee by any Holder of an Investor Certificate and as a result of
which the interests of the Investor Certificateholders of such Series are
materially and adversely affected; provided, however, that a Pay Out Event
pursuant to this subparagraph (b) shall not be deemed to have occurred
hereunder if the relevant Transferor has accepted reassignment of the related
Receivable, or all of such Receivables, if applicable, during such period in
accordance with the provisions hereof;
(c) (i) the Account Owner shall consent to the appointment of a
conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities or
similar proceedings of or relating to the Account Owner or of or
relating to all or substantially all of its property, or a decree or
order of a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for
the winding-up or liquidation of its affairs, shall have been
entered against the Account Owner; or the Account Owner shall admit
in writing its inability to pay its debts generally as they become
due, file a petition to take advantage of any applicable insolvency
or reorganization statute, make any assignment for the benefit of
its creditors or voluntarily suspend payment of its obligations; or
(ii) a Transferor (or any Additional Transferor) shall consent
or fail to object to the appointment of a bankruptcy trustee or
conservator, receiver or liquidator in any bankruptcy proceeding or
other insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to such Transferor
or relating to all or substantially all of such Transferor's
property, or the commencement of an action seeking a decree or order
of a court or agency or supervisory authority having jurisdiction in
the premises for the appointment of a bankruptcy trustee or
conservator, receiver or liquidator in any insolvency, readjustment
of debt, marshalling of assets and liabilities or similar
proceedings, or for the winding-up, insolvency, bankruptcy,
reorganization, conservatorship, receivership or liquidation of a
Transferor's affairs, or notwithstanding an objection by the
Transferor any such action shall have remained undischarged or
unstayed for a period of sixty (60) days or upon entry of any order
or decree providing for such relief; or a Transferor shall admit in
writing its inability to pay its debts generally as they become due,
file, or consent or fail to object (or object without dismissal of
any such filing within sixty (60) days of such filing or the earlier
entry of any order providing for such relief) to the filing of, a
petition to take advantage of any applicable bankruptcy, insolvency
or reorganization, receivership or conservatorship statute, make an
assignment for the benefit of its creditors or voluntarily suspend
payment of its obligations (any such event described in this clause
(c) either in provisions (i) or (ii), an "Insolvency Event");
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(d) a failure by a Transferor to convey Receivables in Additional
Accounts or Participation Interests to the Trust by the day on which it is
required to convey such Receivables or Participation Interests pursuant to
Section 2.08(a);
(e) the Trust shall become an "investment company" within the
meaning of the Investment Company Act;
(f) any Servicer Default shall occur; or
(g) a Transfer Restriction Event under this Agreement or under any
Receivables Purchase Agreement shall occur;
then, in the case of any event described in subparagraphs (a), (b)
or (f), after the applicable grace period, if any, set forth in such
subparagraphs, either the Trustee or the Holders of Investor Certificates
evidencing more than 50% of the aggregate unpaid principal amount of the
Investor Certificates of such Series, by notice then given in writing to the
Transferors and the Servicer (and to the Trustee if given by the
Certificateholders), may declare that a pay out event (a "Pay Out Event") has
occurred with respect to such Series as of the date of such notice, and in the
case of any event described in subparagraph (c), (d), (e) or (g), a Pay Out
Event shall occur with respect to such Series without any notice or other
action on the part of the Trustee or the Investor Certificateholders,
immediately upon the occurrence of such event.
SECTION 9.02. Additional Rights upon the Occurrence of Certain
Events. (a) If an Insolvency Event occurs with respect to any of the
Transferors or any of the Transferors violates Section 2.07(c) for any reason,
the Transferors shall on the day any such Insolvency Event or violation occurs
(the "Appointment Date"), immediately cease to transfer Principal Receivables
to the Trust and shall promptly give notice to the Trustee thereof.
Notwithstanding any cessation of the transfer to the Trust of additional
Principal Receivables, Principal Receivables transferred to the Trust prior to
the occurrence of such Insolvency Event and Collections in respect of such
Principal Receivables and Finance Charge Receivables whenever created, accrued
in respect of such Principal Receivables, shall continue to be a part of the
Trust. Within 15 days after receipt of such notice by the Trustee of the
occurrence of such Insolvency Event or violation of Section 2.07(c), the
Trustee shall (i) publish a notice in an Authorized Newspaper that an
Insolvency Event or violation has occurred and that the Trustee intends to
sell, dispose of or otherwise liquidate the Receivables and (ii) give notice
to Investor Certificateholders and each Series Enhancer entitled thereto
pursuant to the relevant Supplement describing the provisions of this Section
and requesting instructions from such Holders. Unless the Trustee shall have
received instructions within 90 days from the date notice pursuant to clause
(i) above is first published from (x) Holders of Investor Certificates
evidencing more than 50% of the aggregate unpaid principal amount of each
Series or, with respect to any Series with two or more Classes, of each Class,
to the effect that such Investor Certificateholders disapprove of the
liquidation of the Receivables and wish to continue having Principal
Receivables transferred to the Trust as before such Insolvency Event or
violation, (y) to the extent provided in the relevant Supplement, any Series
Enhancer with respect to such Series, and (z) each of the Transferors (other
than the Transferor that is the subject of such Insolvency Event or
violation), including any Additional Transferor, any Holder of a Supplemental
Interest and any permitted assignee or successor under Section 7.02, to such
effect, the Trustee shall promptly sell, dispose
73
of or otherwise liquidate the Receivables by the solicitation of competitive
bids and on terms equivalent to the best purchase offer as determined by the
Trustee. The Transferors and Affiliates and agents of the Transferors shall
not be entitled to participate as a bidder in such sale of the Receivables.
The Trustee may obtain a prior determination from any such conservator,
receiver or liquidator that the terms and manner of any proposed sale,
disposition or liquidation are commercially reasonable. The provisions of
Sections 9.01 and 9.02 shall not be deemed to be mutually exclusive.
(b) The proceeds from the sale, disposition or liquidation of the
Receivables pursuant to paragraph (a) ("Insolvency Proceeds") shall be
immediately deposited in the Collection Account. The Trustee shall determine
conclusively the amount of the Insolvency Proceeds which are deemed to be
Finance Charge Receivables and Principal Receivables. The Insolvency Proceeds
shall be allocated and distributed to Investor Certificateholders in
accordance with Article IV and the terms of each Supplement, and the Trust
shall terminate immediately thereafter.
ARTICLE X
SERVICER DEFAULTS
SECTION 10.01. Servicer Defaults. If any one of the following events
(a "Servicer Default") shall occur and be continuing:
(a) any failure by the Servicer to make any payment, transfer or
deposit or to give instructions or notice to the Trustee pursuant to the terms
of this Agreement or any Supplement on or before the date occurring 5 Business
Days after the date such payment, transfer or deposit or such instruction or
notice is required to be made or given, as the case may be, under the terms of
this Agreement or any Supplement;
(b) failure on the part of the Servicer duly to observe or perform
in any material respect any other covenants or agreements of the Servicer set
forth in this Agreement or any Supplement which has a material adverse effect
on the interests hereunder of the Investor Certificateholders of any Series or
Class (which determination shall be made without regard to whether funds are
then available pursuant to any Series Enhancement) and which continues
unremedied for a period of 60 days after the date on which written notice of
such failure, requiring the same to be remedied, shall have been given to the
Servicer by the Trustee, or to the Servicer and the Trustee by Holders of
Investor Certificates evidencing not less than 10% of the aggregate unpaid
principal amount of all Investor Certificates (or, with respect to any such
failure that does not relate to all Series, 10% of the aggregate unpaid
principal amount of all Series to which such failure relates); or the Servicer
shall delegate its duties under this Agreement, except as permitted by
Sections 8.02 and 8.07, a Responsible Officer of the Trustee has actual
knowledge of such delegation and such delegation continues unremedied for 15
days after the date on which written notice thereof, requiring the same to be
remedied, shall have been given to the Servicer by the Trustee, or to the
Servicer and the Trustee by Holders of Investor Certificates evidencing not
less than 10% of the aggregate unpaid principal amount of all Investor
Certificates;
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(c) any representation, warranty or certification made by the
Servicer in this Agreement or any Supplement or in any certificate delivered
pursuant to this Agreement or any Supplement shall prove to have been
incorrect when made, which has a material adverse effect on the rights of the
Investor Certificateholders of any Series or Class (which determination shall
be made without regard to whether funds are then available pursuant to any
Series Enhancement) and which continues to be incorrect in any material
respect for a period of 60 days after the date on which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Servicer by the Trustee, or to the Servicer and the Trustee by the Holders of
Investor Certificates evidencing not less than 10% of the aggregate unpaid
principal amount of all Investor Certificates (or, with respect to any such
representation, warranty or certification that does not relate to all Series,
10% of the aggregate unpaid principal amount of all Series to which such
representation, warranty or certification relates); or
(d) the Servicer shall consent to the appointment of a conservator
or receiver or liquidator in any insolvency, readjustment of debt, marshalling
of assets and liabilities or similar proceedings of or relating to the
Servicer or of or relating to all or substantially all of its property, or a
decree or order of a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of a conservator or receiver
or liquidator in any insolvency, readjustment of debt, marshalling of assets
and liabilities or similar proceedings, or for the winding-up or liquidation
of its affairs, shall have been entered against the Servicer, and such decree
or order shall have remained in force undischarged or unstayed for a period of
60 days; or the Servicer shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable insolvency or reorganization statute, make any assignment for the
benefit of its creditors or voluntarily suspend payment of its
obligations; then, in the event of any Servicer Default, so long as the
Servicer Default shall not have been remedied, either the Trustee, or the
Holders of Investor Certificates evidencing more than 50% of the aggregate
unpaid principal amount of all Investor Certificates, by notice then given to
the Servicer (and to the Trustee and any Series Enhancer entitled thereto
pursuant to the relevant Supplement if given by the Investor
Certificateholders) (a "Termination Notice"), may terminate all but not less
than all the rights and obligations of the Servicer as Servicer under this
Agreement and in and to the Receivables and the proceeds thereof; provided,
however, if within 60 days of receipt of a Termination Notice the Trustee does
not receive any bids from Eligible Servicers in accordance with Section
10.02(c) to act as a Successor Servicer and receives an Officer's Certificate
of the Transferors to the effect that the Servicer cannot in good faith cure
the Servicer Default which gave rise to the Termination Notice, the Trustee
shall offer the Transferors the right at their option to purchase the
Certificateholders' Interest on the Distribution Date next succeeding 105 days
after the receipt by the Servicer of a Termination Notice. The purchase price
for the Certificateholders' Interest shall be equal to the sum of the amounts
specified therefor with respect to each outstanding Series in the related
Supplement. The Transferors shall notify the Trustee prior to the Record Date
for the Distribution Date of the purchase if they are exercising such option.
If they exercise such option, the Transferors shall (x) deliver to the Trustee
an Opinion of Counsel (which must be an independent outside counsel) to the
affect that, in reliance on certain certificates to the effect that the
Transferors have received reasonably equivalent value and as to the solvency
of the Transferors, the purchase would not be considered a fraudulent transfer
and (y) deposit the purchase price into the Collection Account not later than
12:00 noon, New York City time, on such Distribution Date in immediately
75
available funds. The purchase price shall be allocated and distributed to
Investor Certificateholders in accordance with Article IV and the terms of
each Supplement.
After receipt by the Servicer of such Termination Notice, and on the
date that a Successor Servicer shall have been appointed by the Trustee
pursuant to Section 10.02, all authority and power of the Servicer under this
Agreement shall pass to and be vested in a Successor Servicer; and, without
limitation, the Trustee is hereby authorized and empowered (upon the failure
of the Servicer to cooperate) to execute and deliver, on behalf of the
Servicer, as attorney-in-fact or otherwise, all documents and other
instruments upon the failure of the Servicer to execute or deliver such
documents or instruments, and to do and accomplish all other acts or things
necessary or appropriate to effect the purposes of such transfer of servicing
rights. The Servicer agrees to cooperate with the Trustee and such Successor
Servicer in effecting the termination of the responsibilities and rights of
the Servicer to conduct servicing hereunder including, without limitation, the
transfer to such Successor Servicer of all authority of the Servicer to
service the Receivables provided for under this Agreement, including, without
limitation, all authority over all Collections which shall on the date of
transfer be held by the Servicer for deposit, or which have been deposited by
the Servicer, in the Collection Account, or which shall thereafter be received
with respect to the Receivables, and in assisting the Successor Servicer and
in enforcing all rights to Insurance Proceeds. The Servicer shall promptly
transfer its electronic records relating to the Receivables to the Successor
Servicer in such electronic form as the Successor Servicer may reasonably
request and shall promptly transfer to the Successor Servicer all other
records, correspondence and documents necessary for the continued servicing of
the Receivables in the manner and at such times as the Successor Servicer
shall reasonably request. To the extent that compliance with this Section
10.01 shall require the Servicer to disclose to the Successor Servicer
information of any kind which the Servicer reasonably deems to be
confidential, the Successor Servicer shall be required to enter into such
customary licensing and confidentiality agreements as the Servicer shall deem
necessary to protect its interests.
Notwithstanding the foregoing, any delay in or failure of
performance under Section 10.01(a) for a period of five Business Days or under
Section 10.01(b) or (c) for a period of 60 days (in addition to any period
provided in Section 10.01(a), (b) or (c)) shall not constitute a Servicer
Default until the expiration of such additional five Business Days or 60 days,
respectively, if such delay or failure could not be prevented by the exercise
of reasonable diligence by the Servicer and such delay or failure was caused
by an act of God or the public enemy, acts of declared or undeclared war,
public disorder, rebellion or sabotage, epidemics, landslides, lightning,
fire, hurricanes, earthquakes, floods or similar causes. The preceding
sentence shall not relieve the Servicer from using its best efforts to perform
its respective obligations in a timely manner in accordance with the terms of
this Agreement and any Supplement and the Servicer shall provide the Trustee,
each Rating Agency, any Series Enhancer entitled thereto pursuant to the
relevant Supplement, the Holder of the Transferor Certificate and the Investor
Certificateholders with an Officer's Certificate giving prompt notice of such
failure or delay by it, together with a description of its efforts to so
perform its obligations.
SECTION 10.02. Trustee To Act: Appointment of Successor. (a) On and
after the receipt by the Servicer of a Termination Notice pursuant to Section
10.01, the Servicer shall continue to perform all servicing functions under
this Agreement until the date specified in
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the Termination Notice or otherwise specified by the Trustee or until a date
mutually agreed upon by the Servicer and Trustee. The Trustee shall as
promptly as possible after the giving of a Termination Notice appoint an
Eligible Servicer as a successor servicer (the "Successor Servicer"), and such
Successor Servicer shall accept its appointment by a written assumption in a
form acceptable to the Trustee. In the event that a Successor Servicer has not
been appointed or has not accepted its appointment at the time when the
Servicer ceases to act as Servicer, the Trustee without further action shall
automatically be appointed the Successor Servicer. The Trustee may delegate
any of its servicing obligations to an Affiliate of the Trustee or agent in
accordance with Section 3.01(b) and 8.07. Notwithstanding the foregoing, the
Trustee shall, if it is legally unable so to act, petition a court of
competent jurisdiction to appoint any established institution having net worth
of not less than $50,000,000 and whose regular business includes the servicing
of "VISA" and "MasterCard" credit card receivables as the Successor Servicer
hereunder. The Trustee shall give prompt notice to each Rating Agency, the
Transferors and each Series Enhancer entitled thereto pursuant to the
applicable Supplement upon the appointment of a Successor Servicer.
(b) Upon its appointment, the Successor Servicer shall be the
successor in all respects to the Servicer with respect to servicing functions
under this Agreement and shall be subject to all the responsibilities, duties
and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof, and all references in this Agreement to the Servicer shall
be deemed to refer to the Successor Servicer.
(c) In connection with any Termination Notice, the Trustee will
review any bids which it obtains from Eligible Servicers and shall be
permitted to appoint any Eligible Servicer submitting such a bid as a
Successor Servicer for servicing compensation not in excess of the aggregate
Servicing Fees for all Series; provided, however, that the Transferors shall
be responsible for payment of the Transferors' portion of such aggregate
Servicing Fees (subject to the limitations on recourse to the Transferors set
forth in Section 3.02) and that no such monthly compensation paid out of
Collections shall be in excess of such aggregate Servicing Fees. Each Holder
of any interest in the Transferors' Interest agrees that the portion of the
Collections in respect of Finance Charge Receivables that the Transferors are
entitled to receive pursuant to this Agreement or any Supplement shall be
reduced by an amount sufficient to pay the Transferors' share (determined by
reference to the Supplements with respect to any outstanding Series) of the
compensation of the Successor Servicer.
(d) All authority and power granted to the Successor Servicer under
this Agreement shall automatically cease and terminate upon termination of the
Trust pursuant to Section 12.01 and shall pass to and be vested in the
Transferors and, without limitation, the Transferors are hereby authorized and
empowered to execute and deliver, on behalf of the Successor Servicer, as
attorney-in-fact or otherwise, all documents and other instruments, and to do
and accomplish all other acts or things necessary or appropriate to effect the
purposes of such transfer of servicing rights. The Successor Servicer agrees
to cooperate with the Transferors in effecting the termination of the
responsibilities and rights of the Successor Servicer to conduct servicing on
the Receivables. The Successor Servicer shall transfer its electronic records
relating to the Receivables to the Transferors in such electronic form as the
Transferors may reasonably request and shall transfer all other records,
correspondence and documents to the Transferors in the manner and at such
times as the Transferors shall reasonably request. To the extent that
77
compliance with this Section 10.02 shall require the Successor Servicer to
disclose to the Transferors information of any kind which the Successor
Servicer deems to be confidential, the Transferors shall be required to enter
into such customary licensing and confidentiality agreements as the Successor
Servicer shall deem necessary to protect its interests.
SECTION 10.03. Notification to Certificateholders. Within two
Business Days after the Servicer becomes aware of any Servicer Default, the
Servicer shall give notice thereof to the Trustee, each Rating Agency and any
Series Enhancer entitled thereto pursuant to the relevant Supplement and the
Trustee shall give notice to the Investor Certificateholders. Upon any
termination or appointment of a Successor Servicer pursuant to this Article,
the Trustee shall give prompt notice thereof to the Investor
Certificateholders.
ARTICLE XI
THE TRUSTEE
SECTION 11.01. Duties of Trustee. (a) The Trustee, prior to the
occurrence of a Servicer Default and after the curing of all Servicer Defaults
which may have occurred, undertakes to perform such duties and only such
duties as are specifically set forth in this Agreement. If a Servicer Default
has occurred (which has not been cured or waived) the Trustee shall exercise
such of the rights and powers vested in it by this Agreement, and use the same
degree of care and skill in its exercise, as a prudent man would exercise or
use under the circumstances in the conduct of such man's own affairs.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments
furnished to the Trustee which are specifically required to be furnished
pursuant to any provision of this Agreement, shall examine them to determine
whether they conform to the requirements of this Agreement. The Trustee shall
give prompt written notice to the Certificateholders of any material lack of
conformity of any such instrument to the applicable requirements of this
Agreement discovered by the Trustee which would entitle a specified percentage
of the Certificateholders to take any action pursuant to this Agreement.
(c) Subject to Section 11.01(a), no provision of this Agreement
shall be construed to relieve the Trustee from liability for its own negligent
action, its own negligent failure to act or its own misconduct; provided,
however, that:
(i) the Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee, unless it shall be proved that the Trustee
was negligent in ascertaining the pertinent facts;
(ii) the Trustee shall not be personally liable with respect to
any action taken, suffered or omitted to be taken by it in good
faith in accordance with the direction of the Holders of Investor
Certificates evidencing more than 50% of the aggregate unpaid
principal amount of all Investor Certificates (or, with respect to
any such action that does not relate to all Series, 50% of the
aggregate unpaid principal amountof the Investor
78
Certificates of all Series to which such action relates) relating to
the time, method and place of conducting any proceeding for any
remedy available to the Trustee, or exercising any trust or power
conferred upon the Trustee, under this Agreement; and
(iii) the Trustee shall not be charged with knowledge of any
failure by the Servicer referred to in clauses (a) and (b) of
Section 10.01 unless a Responsible Officer of the Trustee obtains
actual knowledge of such failure or the Trustee receives written
notice of such failure from the Servicer or a Transferor, any
Holders of Investor Certificates evidencing not less than 10% of the
aggregate unpaid principal amount of all Investor Certificates (or,
with respect to any such failure that does not relate to all Series,
10% of the aggregate unpaid principal amount of all Investor
Certificates of all Series to which such failure relates, or the
Series Enhancers for all Series to which such failure relates).
(d) The Trustee shall not be required to expend or risk its own
funds or otherwise incur financial liability in the performance of any of its
duties hereunder or in the exercise of any of its rights or powers hereunder
or thereunder, if there is reasonable ground for believing that the repayment
of such funds or adequate indemnity against such risk or liability is not
reasonably assured to it, and none of the provisions contained in this
Agreement shall in any event require the Trustee to perform, or be responsible
for the manner of performance of, any of the obligations of the Servicer under
this Agreement except during such time, if any, as the Trustee shall be the
successor to, and be vested with the rights, duties, powers and privileges of,
the Servicer in accordance with the terms of this Agreement.
(e) Except for actions expressly authorized by this Agreement, the
Trustee shall take no action reasonably likely to (i) impair the interests of
the Trust in any Receivable now existing or hereafter created or (ii) impair
the value of any Receivable now existing or hereafter created.
(f) The Trustee shall have no power to vary the corpus of the Trust,
except as expressly provided in this Agreement.
(g) In the event that the Paying Agent or the Transfer Agent and
Registrar shall fail to perform any obligation, duty or agreement in the
manner or on the day required to be performed by the Paying Agent or the
Transfer Agent and Registrar, as the case may be, under this Agreement, the
Trustee shall be obligated as soon as possible upon knowledge of a Responsible
Officer thereof and receipt of appropriate records, if any, to perform such
obligation, duty or agreement in the manner so required.
(h) If any of the Transferors has agreed to transfer any of its
receivables (other than the Receivables) to another Person, upon the written
request of such Transferor, the Trustee will enter into such intercreditor
agreements with the transferee of such receivables as are customary and
necessary to separately identify the rights of the Trustee and the Trust and
such other Person in such Transferor's receivables; provided that the Trustee
shall not be required to enter into any intercreditor agreement which could
adversely affect the interests of the Certificateholders and, upon the request
of the Trustee, such Transferor will deliver an Opinion
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of Counsel on any matters relating to such intercreditor agreement, reasonably
requested by the Trustee.
SECTION 11.02. Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 11.01:
(a) the Trustee may rely on and shall be protected in acting on, or
in refraining from acting in accord with, any resolution, Officer's
Certificate, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal, bond
or other paper or document believed by it to be genuine and to have been
signed or presented to it pursuant to this Agreement by the proper party or
parties;(b) the Trustee may consult with counsel, and any advice of such
counsel, or Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken or suffered or omitted by it
hereunder in good faith and in accordance with such advice or Opinion of
Counsel;
(b) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement or any Enhancement Agreement,
or to institute, conduct or defend any litigation hereunder or thereunder or
in relation to this Agreement or any Enhancement Agreement, at the request,
order or direction of any of the Certificateholders, pursuant to the
provisions of this Agreement or any Enhancement Agreement, unless such
Certificateholders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby; nothing contained herein shall, however, relieve the
Trustee of the obligations, upon the occurrence of any Servicer Default (which
has not been cured) to exercise such of the rights and powers vested in it by
this Agreement, and to use the same degree of care and skill in its exercise,
as a prudent man would exercise or use under the circumstances in the conduct
of his own affairs;
(c) the Trustee shall not be personally liable for any action taken,
suffered or omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this Agreement;
(d) the Trustee shall not be bound to make any investigation into
the facts of matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, approval, bond
or other paper or document, unless requested in writing so to do by Holders of
Investor Certificates evidencing more than 25% of the aggregate unpaid
principal amount of all Investor Certificates (or, with respect to any such
matters that do not relate to all Series, 25% of the aggregate unpaid
principal amount of the Investor Certificates of all Series to which such
matters relate);
(e) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys or a custodian, and the Trustee shall not be responsible for any
misconduct or negligence on the part of any such agent, attorney or custodian
appointed with due care by it hereunder; and
(f) except as may be required by subsection 11.01(a) hereof, the
Trustee shall not be required to make any initial or periodic examination of
any documents or records related to the Receivables or the Accounts for the
purpose of establishing the presence or absence of
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defects, the compliance by each Transferor with its representations and
warranties or for any other purpose.
SECTION 11.03. Trustee Not Liable for Recitals in Certificates. The
Trustee assumes no responsibility for the correctness of the recitals
contained herein and in the Certificates (other than the certificate of
authentication on the Certificates). Except as set forth in Section 11.15, the
Trustee makes no representations as to the validity or sufficiency of this
Agreement or any Supplement or of the Certificates (other than the certificate
of authentication on the Certificates) or of any Receivable or related
document. The Trustee shall not be accountable for the use or application by
the Transferors of any of the Certificates or of the proceeds of such
Certificates, or for the use or application of any funds paid to the
Transferors or the Holders of the Transferors' Interest in respect of the
Receivables or deposited in or withdrawn from the Collection Account, any
Series Accounts or any other accounts hereafter established to effectuate the
transactions contemplated by this Agreement and in accordance with the terms
of this Agreement.
SECTION 11.04. Trustee May Own Certificates. Subject to Section
6.06, the Trustee in its individual or any other capacity may become the owner
or pledgee of Investor Certificates with the same rights as it would have if
it were not the Trustee.
SECTION 11.05. The Servicer To Pay Trustee's Fees and Expenses. The
Servicer covenants and agrees to pay to the Trustee from time to time, and the
Trustee shall be entitled to receive, reasonable compensation (which shall not
be limited by any provision of law in regard to the compensation of a trustee
of an express trust) for all services rendered by it in the execution of the
trust hereby created and in the exercise and performance of any of the powers
and duties hereunder of the Trustee, and the Servicer will pay or reimburse
the Trustee (without reimbursement from the Collection Account or otherwise)
upon its request for all reasonable expenses, disbursements and advances
incurred or made by the Trustee in accordance with any of the provisions of
this Agreement or any Enhancement Agreement (including the reasonable fees and
expenses of its agents, any co-trustee and counsel) except any such expense,
disbursement or advance as may arise from its own negligence or bad faith and
except as provided in the following sentence. If the Trustee is appointed
Successor Servicer pursuant to Section 10.02, the provisions of this Section
11.05 shall not apply to expenses, disbursements and advances made or incurred
by the Trustee in its capacity as Successor Servicer.
The obligations of the Servicer under Section 8.04 and this Section
11.05 shall survive the termination of the Trust and the resignation or
removal of the Trustee.
SECTION 11.06. Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be a bank or a corporation organized and doing
business under the laws of the United States of America or any state thereof
authorized under such laws to exercise corporate trust powers, having a
combined capital and surplus of at least $50,000,000 and subject to
supervision or examination by Federal or state authority and maintain any
credit or deposit rating required by any Rating Agency (as of the date hereof
Baa3 for ▇▇▇▇▇'▇). If such bank or corporation publishes reports of condition
at least annually, pursuant to law or to the requirements of the aforesaid
supervising or examining authority, then for the purpose of this Section
11.06, the combined capital and surplus of such bank or corporation shall be
deemed to
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be its combined capital and surplus as set forth in its most recent report of
condition so published. In case at any time the Trustee shall cease to be
eligible in accordance with the provisions of this Section 11.06, the Trustee
shall resign immediately in the manner and with the effect specified in
Section 11.07.
SECTION 11.07. Resignation or Removal of Trustee. (a) The Trustee
may at any time resign and be discharged from the trust hereby created by
giving written notice thereof to the Servicer and the Transferors. Upon
receiving such notice of resignation, the Transferors shall promptly appoint a
successor trustee by written instrument, in duplicate, one copy of which
instrument shall be delivered to the resigning Trustee and one copy to the
successor trustee. If no successor trustee shall have been so appointed and
have accepted within 30 days after the giving of such notice of resignation,
the resigning Trustee may petition any court of competent jurisdiction for the
appointment of a successor trustee.
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 11.06 and shall fail to resign after
written request therefor by the Servicer or the Transferors, or if at any time
the Trustee shall be legally unable to act, or shall be adjudged a bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, in which event the Servicer shall remove the Trustee and promptly
appoint a successor trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the Trustee so removed and one copy to
the successor trustee.
(c) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section 11.07
shall not become effective until acceptance of appointment by the successor
trustee as provided in Section 11.08 and any liability of the Trustee arising
hereunder shall survive such appointment of a successor trustee.
SECTION 11.08. Successor Trustee. (a) Any successor trustee
appointed as provided in Section 11.07 shall execute, acknowledge and deliver
to the Transferors, to the Servicer and to its predecessor Trustee an
instrument accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor Trustee shall become effective and such
successor trustee, without any further act, deed or conveyance, shall become
fully vested with all the rights, powers, duties and obligations of its
predecessor hereunder, with the like effect as if originally named as Trustee
herein. The predecessor Trustee shall deliver to the successor trustee all
documents, statements, money and other property held by it hereunder, and the
Servicer and the Transferors and the predecessor Trustee shall execute and
deliver such instruments and do such other things as may reasonably be
required for fully and certainly vesting and confirming in the successor
trustee all such rights, powers, duties and obligations.
(b) No successor trustee shall accept appointment as provided in
this Section 11.08 unless at the time of such acceptance such successor
trustee shall be eligible under the provisions of Section 11.06.
(c) Upon acceptance of appointment by a successor trustee as
provided in this Section, such successor trustee shall provide notice of such
succession hereunder to all Investor
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Certificateholders and the Servicer shall provide such notice to each Rating
Agency and any Series Enhancer entitled thereto pursuant to the relevant
Supplement.
SECTION 11.09. Merger or Consolidation of Trustee. Any Person into
which the Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Person succeeding
to the corporate trust business of the Trustee, shall be the successor of the
Trustee hereunder, provided such corporation shall be eligible under the
provisions of Section 11.06, without the execution or filing of any paper or
any further act on the part of any of the parties hereto, anything herein to
the contrary notwithstanding.
SECTION 11.10. Appointment of Co-Trustee or Separate Trustee. (a)
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any
part of the Trust may at the time be located, the Trustee shall have the power
and may execute and deliver all instruments to appoint one or more Persons to
act as a co-trustee or co-trustees, or separate trustee or separate trustees,
of all or any part of the Trust, and to vest in such Person or Persons, in
such capacity and for the benefit of the Certificateholders, such title to the
Trust, or any part thereof, and, subject to the other provisions of this
Section 11.10, such powers, duties, obligations, rights and trusts as the
Trustee may consider necessary or desirable; provided, however, that the
Trustee shall exercise due care in the appointment of any co-trustee. No
co-trustee or separate trustee hereunder shall be required to meet the terms
of eligibility as a successor trustee under Section 11.06 and no notice to
Certificateholders of the appointment of any co-trustee or separate trustee
shall be required under Section 11.08.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, Powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee
or co-trustee is not authorized to act separately without the
Trustee joining in such act) except to the extent that under any
laws of any jurisdiction in which any particular act or acts are to
be performed (whether as Trustee hereunder or as successor to the
Servicer hereunder) the Trustee shall be incompetent or unqualified
to perform such act or acts, in which event such rights, powers,
duties and obligations (including the holding of title to the Trust
or any portion thereof in any such jurisdiction) shall be exercised
and performed singly by such separate trustee or co-trustee, but
solely at the direction of the Trustee;
(ii) no trustee hereunder shall be personally liable by reason
of any act or omission of any other trustee hereunder; and
(iii) the Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee.
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(c) Any notice, request or other writing given to the Trustee shall
be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement
and the conditions of this Article XI. Each separate trustee and co-trustee,
upon its acceptance of the trusts conferred, shall be vested with the estates
or property specified in its instrument of appointment, either jointly with
the Trustee or separately, as may be provided therein, subject to all the
provisions of this Agreement, specifically including every provision of this
Agreement relating to the conduct of, affecting the liability of, or affording
protection to, the Trustee. Every such instrument shall be filed with the
Trustee and a copy thereof given to the Servicer.
(d) Any separate trustee or co-trustee may at any time constitute
the Trustee its agent or attorney-in-fact with full power and authority, to
the extent not prohibited by law, to do any lawful act under or in respect to
this Agreement on its behalf and in its name. If any separate trustee or
co-trustee shall die, become incapable of acting, resign or be removed, all of
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
SECTION 11.11. Tax Returns. In the event the Trust shall be required
to file tax returns, the Servicer shall prepare or shall cause to be prepared
any tax returns required to be filed by the Trust and shall remit such returns
to the Trustee for signature at least five days before such returns are due to
be filed; the Trustee shall promptly sign such returns and deliver such
returns after signature to the Servicer and such returns shall be filed by the
Servicer. The Servicer in accordance with the terms of each Supplement shall
also prepare or shall cause to be prepared all tax information required by law
to be distributed to Investor Certificateholders. The Trustee, upon request,
will furnish the Servicer with all such information known to the Trustee as
may be reasonably required in connection with the preparation of all tax
returns of the Trust. In no event shall the Trustee or the Servicer (except as
provided in Section 8.04) or the Transferors be liable for any liabilities,
costs or expenses of the Trust or the Investor Certificateholders arising
under any tax law, including without limitation Federal, state, local or
foreign income or excise taxes or any other tax imposed on or measured by
income (or any interest or penalty with respect thereto or arising from a
failure to comply therewith).
SECTION 11.12. Trustee May Enforce Claims Without Possession of
Certificates. All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee. Any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Certificateholders in respect of which such judgment
has been obtained.
SECTION 11.13. Suits for Enforcement. (a) If a Servicer Default
shall occur and be continuing, the Trustee, in its discretion may, subject to
the provisions of Sections 10.01 and 11.14, proceed to protect and enforce its
rights and the rights of the Certificateholders under this Agreement by a
suit, action or proceeding in equity or at law or otherwise, whether for the
specific performance of any covenant or agreement contained in this Agreement
or in aid of
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the execution of any power granted in this Agreement or for the enforcement of
any other legal, equitable or other remedy as the Trustee, being advised by
counsel, shall deem most effectual to protect and enforce any of the rights of
the Trustee or the Certificateholders.
(b) If an Insolvency Event shall have occurred with respect to a
Transferor, the Trustee shall, irrespective of whether the principal of any
Series or Class of Investor Certificates shall then be due and payable:
(i) unless prohibited by applicable law promptly take or cause
to be taken any and all necessary or advisable commercially
reasonable action as a secured creditor on behalf of the
Certificateholders to recover, repossess, collect or liquidate the
Receivables or any other Trust Assets on a "self-help" basis or
otherwise and exercise any rights or remedies of a secured party
under the applicable UCC and take any other appropriate action to
protect and enforce the rights and remedies of the Trustee and the
Certificateholders;
(ii) promptly, and in any case within any applicable claims bar
period specified under applicable law, file and prove a claim or
claims under applicable law, by filing proofs of claim, protective
proofs of claim or otherwise, for the whole amount of unpaid
principal and interest in respect of the Investor Certificates and
to file such other papers or documents as may be necessary or
advisable in order to have the claims of the Trustee and the
Certificateholders allowed in any judicial, administrative,
corporate or other proceedings relating to such Transferor, its
creditors or its property, including any actions relating to the
preservation of deficiency claims or for the protection against loss
of any claim in the event the Trustee's or the Certificateholders'
status as secured creditors are successfully challenged; and
(iii) collect and receive any moneys or other property payable
or deliverable on any such claims and distribute all amounts with
respect to the claims of the Certificateholders to the
Certificateholders.
(c) Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any
Certificateholder any plan of reorganization, arrangement, adjustment or
composition affecting the Investor Certificates or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Certificateholder in any such proceeding.
SECTION 11.14. Rights of Certificateholders To Direct Trustee.
Holders of Investor Certificates evidencing more than 50% of the aggregate
unpaid principal amount of all Investor Certificates (or, with respect to any
remedy, trust or power that does not relate to all Series, 50% of the
aggregate unpaid principal amount of the Investor Certificates of all Series
to which such remedy, trust or power relates) shall have the right to direct
the time, method, and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power conferred on the
Trustee relating to such proceeding; provided, however, that, subject to
Section 11.01, the Trustee shall have the right to decline to follow any such
direction if the Trustee being advised by counsel determines that the action
so directed may not lawfully be taken, or if the Trustee in good faith shall,
by a Responsible Officer or Responsible Officers of
85
the Trustee, determine that the proceedings so directed would be illegal or
involve it in personal liability or be unduly prejudicial to the rights of
Certificateholders not parties to such direction; and provided further that
nothing in this Agreement shall impair the right of the Trustee to take any
action deemed proper by the Trustee and which is not inconsistent with such
direction.
SECTION 11.15. Representations and Warranties of Trustee. The
Trustee represents and warrants as of each Closing Date that:
(a) the Trustee is a banking corporation organized, existing and in
good standing under the laws of the State of New York;
(b) the Trustee has full power, authority and right to execute,
deliver and perform this Agreement and each Supplement, and has taken all
necessary action to authorize the execution, delivery and performance by it of
this Agreement and each Supplement; and
(c) this Agreement and each Supplement has been duly executed and
delivered by the Trustee.
SECTION 11.16. Maintenance of Office or Agency. The Trustee will
maintain at its expense an office or agency (the "Corporate Trust Office")
where notices and demands to or upon the Trustee in respect of the
Certificates and this Agreement may be served (a) in the Borough of Manhattan,
The City of New York, in the case of Registered Certificates and Holders
thereof, and (b) in London or Luxembourg, in the case of Bearer Certificates
and Holders thereof, if and for so long as any Bearer Certificates are
outstanding. The Corporate Trust Office shall initially be located at Four
▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇. The Trustee will give prompt notice
to the Servicer, to the Transferors and to Investor Certificateholders of any
change in the location of the Certificate Register or any such office or
agency.
SECTION 11.17. Receivables. It is expressly understood and agreed by
the parties hereto that (a) the Trustee accepts all right, title and interest
to the Receivables, the proceeds thereof, and the other property, now existing
and hereafter created, conveyed to the Trustee under this Agreement on behalf
of the Trust, for the benefit of the Certificateholders, and not in its
individual capacity, (b) under no circumstance will the Trustee be deemed to
make any representations or warranties in its individual capacity in respect
of the Receivables so conveyed, (c) the Trustee shall have no obligation to
expend its own funds to purchase Receivables pursuant to the terms of this
Agreement, and (d) under no circumstance shall Bankers Trust Company be
personally liable for the payment of any indebtedness or expenses of the
Trust.
ARTICLE XII
TERMINATION
SECTION 12.01. Termination of Trust. The Trust and the respective
obligations and responsibilities of the Transferors, the Servicer and the
Trustee created hereby (other than the obligation of the Trustee to make
payments to Investor Certificateholders as hereinafter set forth) shall
terminate, except with respect to the duties described in Sections 7.04, 6.04,
12.02(b) and 13.11 upon the earlier of (a) June 1, 2022, (ii) the day
following the Distribution Date on
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which the Invested Amount and Enhancement Invested Amount for each Series is
zero (provided that the Transferors have delivered a written notice to the
Trustee electing to terminate the Trust) and (b) the time provided in Section
9.02(b).
SECTION 12.02. Final Distribution. (a) The Servicer shall give the
Trustee at least 30 days prior notice of the Distribution Date on which the
Investor Certificateholders of any Series or Class may surrender their
Investor Certificates for payment of the final distribution on and cancelation
of such Investor Certificates (or, in the event of a final distribution
resulting from the application of Section 2.06, 9.02 or 10.01, notice of such
Distribution Date promptly after the Servicer has determined that a final
distribution will occur, if such determination is made less than 30 days prior
to such Distribution Date). Such notice shall be accompanied by an Officer's
Certificate setting forth the information specified in Section 3.05 covering
the period during the then-current calendar year through the date of such
notice. Not later than the fifth day of the month in which the final
distribution in respect of such Series or Class is payable to Investor
Certificateholders, the Trustee shall provide notice to Investor
Certificateholders of such Series or Class specifying (i) the date upon which
final payment of such Series or Class will be made upon presentation and
surrender of Investor Certificates of such Series or Class at the office or
offices therein designated, (ii) the amount of any such final payment and
(iii) that the Record Date otherwise applicable to such payment date is not
applicable, payments being made only upon presentation and surrender of such
Investor Certificates at the office or offices therein specified (which, in
the case of Bearer Certificates, shall be outside the United States). The
Trustee shall give such notice to the Transfer Agent and Registrar and the
Paying Agent at the time such notice is given to Investor Certificateholders.
(b) Notwithstanding a final distribution to the Investor
Certificateholders of any Series or Class (or the termination of the Trust),
except as otherwise provided in this paragraph, all funds then on deposit in
the Collection Account and any Series Account allocated to such Investor
Certificateholders shall continue to be held in trust for the benefit of such
Investor Certificateholders and the Paying Agent or the Trustee shall pay such
funds to such Investor Certificateholders upon surrender of their Investor
Certificates (and any excess shall be paid in accordance with the terms of any
relevant Enhancement Agreement). In the event that all such Investor
Certificateholders shall not surrender their Investor Certificates for
cancelation within six months after the date specified in the notice from the
Trustee described in paragraph (a), the Trustee shall give a second notice to
the remaining such Investor Certificateholders to surrender their Investor
Certificates for cancelation and receive the final distribution with respect
thereto (which surrender and payment, in the case of Bearer Certificates,
shall be outside the United States). If within one year after the second
notice all such Investor Certificates shall not have been surrendered for
cancelation, the Trustee may take appropriate steps, or may appoint an agent
to take appropriate steps, to contact the remaining such Investor
Certificateholders concerning surrender of their Investor Certificates, and
the cost thereof shall be paid out of the funds in the Collection Account or
any Series Account held for the benefit of such Investor Certificateholders.
The Trustee and the Paying Agent shall pay to the Transferors any moneys held
by them for the payment of principal or interest that remains unclaimed for
two years. After payment to the Transferors, Investor Certificateholders
entitled to the money must look to the Transferors for payment as general
creditors unless an applicable abandoned property law designates another
Person.
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(c) In the event that the Invested Amount with respect to any Series
is greater than zero on its Series Termination Date or such earlier date as is
specified in the related Supplement (after giving effect to deposits and
distributions otherwise to be made on such date), the Trustee will sell or
cause to be sold on such Series Termination Date, in accordance with the
procedures and subject to the conditions described in such Supplement,
Principal Receivables and the related Finance Charge Receivables (or interests
therein) in an amount equal to the Invested Amount with respect to such Series
on such date (after giving effect to such deposits and distributions;
provided, however, that in no event shall such amount exceed such Series'
allocable share of Receivables on such Series Termination Date). None of the
Transferor, any Affiliate of the Transferor or any agent of the Transferor
shall be permitted to purchase such Receivables in such case. The proceeds
from any such sale shall be allocated and distributed in accordance with the
terms of the applicable Supplement.
SECTION 12.03. Transferors' Termination Rights. Upon the termination
of the Trust pursuant to Section 12.01 and the assignment of any Supplemental
Interest to the Transferors, the Trustee shall sell, assign and convey to the
Transferors or their designee, without recourse, representation or warranty,
all right, title and interest of the Trustee in the Receivables, whether then
existing or thereafter created, all moneys due or to become due and all
amounts received with respect thereto and all proceeds thereof, except for
amounts held by the Trustee pursuant to Section 12.02(b). The Trustee shall
execute and deliver such instruments of transfer and assignment, in each case
without recourse, as shall be reasonably requested by the Transferors to vest
in the Transferors or their designee all right, title and interest which the
Trustee had in the Receivables and such other related assets.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.01. Amendment; Waiver of Past Defaults. (a) This
Agreement or any Supplement may be amended from time to time (including in
connection with (x) the issuance of a Supplemental Interest, (y) the addition
of a Participation Interest to the Trust or (z) the designation of an
Additional Transferor or Additional Account Owner) by the Servicer, the
Transferors and the Trustee without the consent of any of the
Certificateholders, provided that (i) each Transferor shall have delivered to
the Trustee an Officer's Certificate to the effect that such Transferor
reasonably believes that such action shall not adversely affect in any
material respect the interests of any Investor Certificateholder and (ii) the
Rating Agency Condition shall have been satisfied with respect to any such
amendment; provided, however, that notwithstanding the fact that clauses (i)
and (ii) of this Section 13.01(a) would otherwise apply, any amendment that
significantly changes the permitted activities of the Trust described in
Section 2.02(e) shall require the consent of the Holders of Investor
Certificates evidencing more than 50% of the aggregate unpaid principal amount
of the Investor Certificates of all outstanding Series.
(b) This Agreement or any Supplement may also be amended from time
to time by the Servicer, the Transferors and the Trustee, with the consent of
the Holders of Investor Certificates evidencing not less than 66-2/3% of the
aggregate unpaid principal amount of the Investor Certificates of all
adversely affected Series, for the purpose of adding any provisions to
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or changing in any manner or eliminating any of the provisions of this
Agreement or any Supplement or of modifying in any manner the rights of the
Certificateholders; provided, however, that no such amendment shall (i) reduce
in any manner the amount of or delay the timing of any distributions to be
made to Investor Certificateholders or deposits of amounts to be so
distributed or the amount available under any Series Enhancement without the
consent of each affected Certificateholder (provided that any amendment of the
terms of a Pay Out Event shall not be deemed to be within the scope of this
clause (i)), (ii) change the definition of or the manner of calculating the
interest of any Investor Certificateholder without the consent of each
affected Investor Certificateholder, (iii) reduce the aforesaid percentage
required to consent to any such amendment without the consent of each Investor
Certificateholder or (iv) adversely affect the rating of any Series or Class
by each Rating Agency without the consent of the Holders of Investor
Certificates of such Series or Class evidencing not less than 66-2/3% of the
aggregate unpaid principal amount of the Investor Certificates of such Series
or Class. Any amendment to be effected pursuant to this paragraph shall be
deemed to adversely affect all outstanding Series, other than any Series with
respect to which such action shall not, as evidenced by an Opinion of Counsel
for the Transferors, addressed and delivered to the Trustee, adversely affect
in any material respect the interests of any Investor Certificateholder of
such Series. The Trustee may, but shall not be obligated to, enter into any
such amendment which affects the Trustee's rights, duties or immunities under
this Agreement or otherwise.
(c) Promptly after the execution of any such amendment or consent
(other than an amendment pursuant to paragraph (a)), the Trustee shall furnish
notification of the substance of such amendment to each Investor
Certificateholder, and the Servicer shall furnish notification of the
substance of such amendment to each Rating Agency and each Series Enhancer
entitled thereto pursuant to the relevant Supplement.
(d) It shall not be necessary for the consent of Investor
Certificateholders under this Section to approve the particular form of any
proposed amendment, but it shall be sufficient if such consent shall approve
the substance thereof. The manner of obtaining such consents and of evidencing
the authorization of the execution thereof by Investor Certificateholders
shall be subject to such reasonable requirements as the Trustee may prescribe.
(e) Any Supplement executed in accordance with the provisions of
Section 6.03 shall not be considered an amendment to this Agreement for the
purposes of this Section.
(f) The Holders of Investor Certificates evidencing more than
66-2/3% of the aggregate unpaid principal amount of the Investor Certificates
of each Series, or, with respect to any Series with two or more Classes, of
each Class (or, with respect to any default that does not relate to all
Series, 66-2/3% of the aggregate unpaid principal amount of the Investor
Certificates of each Series to which such default relates or, with respect to
any such Series with two or more classes, of each Class) may, on behalf of all
Certificateholders, waive any default by the Transferors or the Servicer in
the performance of their obligations hereunder and its consequences, except
the failure to make any distributions required to be made to Investor
Certificateholders or to make any required deposits of any amounts to be so
distributed. Upon any such waiver of a past default, such default shall cease
to exist, and any default arising therefrom shall be deemed to have been
remedied for every purpose of this Agreement. No such
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waiver shall extend to any subsequent or other default or impair any right
consequent thereon except to the extent expressly so waived.
SECTION 13.02. Protection of Right, Title and Interest to Trust. (a)
The Transferors shall cause this Agreement, all amendments and supplements
hereto and/or all financing statements and continuation statements and any
other necessary documents covering the Certificateholders' and the Trustee's
right, title and interest to the Trust Assets to be promptly recorded,
registered and filed, and at all times to be kept recorded, registered and
filed, all in such manner and in such places as may be required by law fully
to preserve and protect the right, title and interest of the
Certificateholders and the Trustee hereunder to all property comprising the
Trust. The Transferors shall deliver to the Trustee file-stamped copies of, or
filing receipts for, any document recorded, registered or filed as provided
above, as soon as available following such recording, registration or filing.
The Transferors shall cooperate fully with the Servicer in connection with the
obligations set forth above and will execute any and all documents reasonably
required to fulfill the intent of this paragraph.
(b) No Transferor shall change its name, or its type or jurisdiction
of organization unless it has first (i) made all filings in all relevant
jurisdictions under the UCC and other applicable law as are necessary to
continue and maintain the first-priority perfected ownership or, security
interest of the Trustee in the Receivables, the proceeds thereof, and the
other property conveyed to the Trustee hereunder, and (ii) delivered to the
Servicer and the Trustee an Opinion of Counsel to the effect that all
necessary filings have been made under the UCC in all relevant jurisdictions
as are necessary to continue and maintain the first-priority perfected
ownership or security interest of the Trustee in the Receivables, the proceeds
thereof, and the other property conveyed to the Trustee hereunder.
(c) Each Transferor and the Servicer will at all times maintain
records concerning the Receivables and its principal executive offices within
the United States; provided, however, that each Transferor and the Servicer
may maintain offices outside the United States that engage in servicing
activities with respect to the Receivables, so long as the information
necessary to perfect or to continue the perfection of the Trustee's security
interest in the Receivables and proceeds thereof, including the account
number, the aggregate amount outstanding in such Account and the aggregate
amount of Principal Receivables outstanding in such Account, is also
maintained in its servicing records located in the United States.
(d) The Transferors will deliver to the Trustee and any Series
Enhancer entitled thereto pursuant to the relevant Supplement: (i) upon the
execution and delivery of each amendment of this Agreement or any Supplement,
an Opinion of Counsel to the effect specified in Exhibit H-1; (ii) on each
Addition Date on which any Additional Accounts (other than Automatic
Additional Accounts) are to be designated as Accounts pursuant to Section 2.08
(a) or (b) and on each date specified in Section 2.08(c)(iii) with respect to
the inclusion of Automatic Additional Accounts as Accounts, an Opinion of
Counsel substantially in the form of Exhibit H-2, and on each Addition Date on
which any Participation Interests are to be included in the Trust pursuant to
Section 2.08(a) or (b), an opinion of Counsel covering the same substantive
legal issues addressed by Exhibit H-2 but conformed to the extent appropriate
to relate to Participation Interests; and (iv) on or before March 31 of each
year, beginning with March 31, 1994, an Opinion of Counsel substantially in
the form of Exhibit H-3.
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SECTION 13.03. Limitation on Rights of Certificateholders. (a) The
death or incapacity of any Certificateholder shall not operate to terminate
this Agreement or the Trust, nor shall such death or incapacity entitle such
Certificateholders' legal representatives or heirs to claim an accounting or
to take any action or commence any proceeding in any court for a partition or
winding up of the Trust, nor otherwise affect the rights, obligations and
liabilities of the parties hereto or any of them.
(b) No Investor Certificateholder shall have any right to vote
(except as expressly provided in this Agreement) or in any manner otherwise
control the operation and management of the Trust, or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Certificates, be construed so as to constitute the Investor
Certificateholders from time to time as partners or members of an association,
nor shall any Investor Certificateholder be under any liability to any third
person by reason of any action taken by the parties to this Agreement pursuant
to any provision hereof.
(c) No Investor Certificateholder shall have any right by virtue of
any provisions of this Agreement to institute any suit, action or proceeding
in equity or at law upon or under or with respect to this Agreement, unless
such Investor Certificateholder previously shall have made, and unless the
Holders of Investor Certificates evidencing more than 50% of the aggregate
unpaid principal amount of all Investor Certificates (or, with respect to any
such action, suit or proceeding that does not relate to all Series, 50% of the
aggregate unpaid principal amount of the Investor Certificates of all Series
to which such action, suit or proceeding relates) shall have made, a request
to the Trustee to institute such action, suit or proceeding in its own name as
Trustee hereunder and shall have offered to the Trustee such reasonable
indemnity as it may require against the costs, expenses and liabilities to be
incurred therein or thereby, and the Trustee, for 60 days after such request
and offer of indemnity, shall have neglected or refused to institute any such
action, suit or proceeding; it being understood and intended, and being
expressly covenanted by each Investor Certificateholder with every other
Investor Certificateholder and the Trustee, that no one or more Investor
Certificateholders shall have any right in any manner whatever by virtue or by
availing itself or themselves of any provisions of this Agreement to affect,
disturb or prejudice the rights of the holders of any other of the Investor
Certificates, or to obtain or seek to obtain priority over or preference to
any other such Investor Certificateholder, or to enforce any right under this
Agreement, except in the manner herein provided and for the equal, ratable and
common benefit of all Investor Certificateholders except as otherwise
expressly provided in this Agreement. For the protection and enforcement of
the provisions of this Section, each and every Investor Certificateholder and
the Trustee shall be entitled to such relief as can be given either at law or
in equity.
SECTION 13.04. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AND THE OBLIGATIONS, RIGHTS
AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH
SUCH LAWS.
SECTION 13.05. Notices; Payments. (a) All demands, notices,
instructions, directions and communications (collectively, "Notices") under
this Agreement shall be in writing and shall be deemed to have been duly given
if personally delivered at, mailed by registered mail, return receipt
requested, or sent by facsimile transmission (i) in the case of the
Transferors
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to, __________, __________, Attention: _________, (ii) in the case
of the Servicer, to _____, (iii) in the case of the Trustee, to Bankers Trust
Company, Four ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of Corporate
Trust Agency Group (facsimile no. (▇▇▇) ▇▇▇-▇▇▇▇), (iv) in the case of
Moody's, to ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of ABS
Monitoring Department 4th Floor (facsimile no. 212-553-4600), (v) in the case
of Standard & Poor's, to ▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of
Asset Backed Group, 15th Floor (facsimile no. 212-412-0323), (vi) in the case
of the Paying Agent or the Transfer Agent and Registrar, to Bankers Trust
Company, Four ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention of Corporate
Trust Agency Group (facsimile no. (▇▇▇) ▇▇▇-▇▇▇▇) and (vii) to any other
Person as specified in any supplement; or, as to each party, at such other
address or facsimile number as shall be designated by such party in a written
notice to each other party.
(b) Any Notice required or permitted to be given to a Holder of
Registered Certificates shall be given by first-class mail, postage prepaid,
at the address of such Holder as shown in the Certificate Register. No Notice
shall be required to be mailed to a Holder of Bearer Certificates or Coupons
but shall be given as provided below. Any Notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given, whether or not the Investor Certificateholder receives such Notice. In
addition, (i) if and so long as any Series or Class is listed on the
Luxembourg Stock Exchange and such Exchange shall so require, any Notice to
Investor Certificateholders shall be published in an Authorized Newspaper of
general circulation in Luxembourg within the time period prescribed in this
Agreement and (ii) in the case of any Series or Class with respect to which
any Bearer Certificates are outstanding, any Notice required or permitted to
be given to Investor Certificateholders of such Series or Class shall be
published in an Authorized Newspaper within the time period prescribed in this
Agreement.
(c) All Notices to be made to the Transferors shall be deemed given
if one notice is provided to the address of LLC. All payments hereunder to the
Bank, as Servicer, shall be made to such account as the Bank may specify in
writing. All payments hereunder to the Transferors shall be deemed made if
made to the account of LLC.
SECTION 13.06. Rule 144A Information. For so long as any of the
Investor Certificates of any Series or Class are "restricted securities"
within the meaning of Rule 144(a)(3) under the Act, each of the Transferors,
the Trustee, the Servicer and any Series Enhancer agree to cooperate with each
other to provide to any Investor Certificateholders of such Series or Class
and to any prospective purchaser of Certificates designated by such an
Investor Certificateholder, upon the request of such Investor
Certificateholder or prospective purchaser, any information required to be
provided to such holder or prospective purchaser to satisfy the condition set
forth in Rule 144A(d)(4) under the Act.
SECTION 13.07. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall for any
reason whatsoever be held invalid, then such provisions shall be deemed
severable from the remaining provisions of this Agreement and shall in no way
affect the validity or enforceability of the remaining provisions or of the
Certificates or the rights of the Certificateholders.
92
SECTION 13.08. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 8.02, this Agreement may not
be assigned by the Servicer without the prior consent of Holders of Investor
Certificates evidencing not less than 66-2/3% of the aggregate unpaid
principal amount of all outstanding Investor Certificates. The Transferor will
notify the Rating Agencies of any such assignment.
SECTION 13.09. Certificates Nonassessable and Fully Paid. It is the
intention of the parties to this Agreement that the Certificateholders shall
not be personally liable for obligations of the Trust, that the interests in
the Trust represented by the Certificates shall be nonassessable for any
losses or expenses of the Trust or for any reason whatsoever and that
Certificates upon authentication thereof by the Trustee pursuant to Section
6.02 are and shall be deemed fully paid.
SECTION 13.10. Further Assurances. The Transferors and the Servicer
agree to do and perform, from time to time, any and all acts and to execute
any and all further instruments required or reasonably requested by the
Trustee more fully to effect the purposes of this Agreement, including the
execution of any financing statements or continuation statements relating to
the Receivables for filing under the provisions of the UCC of any applicable
jurisdiction.
SECTION 13.11. Nonpetition Covenant. Notwithstanding any prior
termination of this Agreement, the Servicer, the Trustee, each Transferor,
each Series Enhancer and each holder of a Supplemental Interest shall not,
prior to the date which is one year and one day after the termination of this
Agreement with respect to the Trust, acquiesce, petition or otherwise invoke
or cause the Trust to invoke the process of any Governmental Authority for the
purpose of commencing or sustaining a case against the Trust under any Debtor
Relief Law or appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of the Trust or any substantial part of
its property or ordering the winding-up or liquidation of the affairs of the
Trust.
Notwithstanding any prior termination of this Agreement, neither the
Servicer, the Trustee nor the Certificateholders shall institute, or join in
instituting a proceeding against any Transferor under any Debtor Relief Law or
other proceedings under any United States federal or state bankruptcy or
similar law.
SECTION 13.12. No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of the Trustee or the
Certificateholders, any right, remedy, power or privilege under this Agreement
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege under this Agreement preclude any other
or further exercise thereof or the exercise of any other right, remedy, power
or privilege. The rights, remedies, powers and privileges provided under this
Agreement are cumulative and not exhaustive of any rights, remedies, powers
and privileges provided by law.
SECTION 13.13. Counterparts. This Agreement may be executed in two
or more counterparts (and by different parties on separate counterparts), each
of which shall be an original, but all of which together shall constitute one
and the same instrument.
93
SECTION 13.14. Third-Party Beneficiaries. This Agreement will inure
to the benefit of and be binding upon the parties hereto, the
Certificateholders, any Series Enhancer (to the extent provided in this
Agreement and the related Supplement) and their respective successors and
permitted assigns. Except as otherwise expressly provided in this Agreement,
no other Person will have any right or obligation hereunder.
SECTION 13.15. Actions by Certificateholders. (a) Wherever in this
Agreement a provision is made that an action may be taken or a Notice given by
Certificateholders, such action or Notice may be taken or given by any
Certificateholder, unless such provision requires a specific percentage of
Certificateholders.
(b) Any Notice, request, authorization, direction, consent, waiver
or other act by the Holder of a Certificate shall bind such Holder and every
subsequent Holder of such Certificate and of any Certificate issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done or omitted to be done by the Trustee or the Servicer
in reliance thereon, whether or not notation of such action is made upon such
Certificate.
SECTION 13.16. Merger and Integration. Except as specifically stated
otherwise herein, this Agreement sets forth the entire understanding of the
parties relating to the subject matter hereof, and all prior understandings,
written or oral, are superseded by this Agreement. This Agreement may not be
modified, amended, waived or supplemented except as provided herein.
SECTION 13.17. Headings. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.
SECTION 13.18. Construction of Agreement. The Transferors hereby
grant to the Trustee a security interest for the benefit of (a) the
Certificateholders and (b) any Series Enhancer to the extent of the
Enhancement Invested Amount, if any, provided for in the relevant Supplement
(which interest, in the case of any Series Enhancer, will be subordinated to
the interest of the Certificateholders of such Series in accordance with the
relevant Supplement), in all of the Transferors' right, title and interest in,
to and under the Receivables now existing and hereafter created, all moneys
due or to become due and all amounts received with respect thereto and all
"proceeds" thereof and any other Trust Assets, to secure all the Transferors'
and Servicer's obligations hereunder, including the Transferors' obligation to
sell or transfer Receivables hereafter created to the Trust. This Agreement
shall constitute a security agreement under applicable law.
SECTION 13.19. Characterization of the Trust. For purposes of SFAS
140, the parties hereto intend that the Trust shall be treated as a
"qualifying special purpose entity" as such term is used in SFAS 140 and any
successor rule thereto and its permitted activities shall be limited in
accordance with paragraph 35 thereof.
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ARTICLE XIV
Transition Provisions
SECTION 14.01. Substitution Date. This amendment and restatement of
this Agreement shall become effective upon the satisfaction of the following
conditions (the effective date, the "Substitution Date"):
(a) Chase USA shall have contributed or sold the Transferor Interest
to LLC;
(b) The relevant conditions to this amendment set forth in Section
13.01(a) shall have been satisfied.
(c) UCC financing statements naming LLC as debtor and the Trustee as
secured party shall have been filed in accordance with Section 13.02.
(d) The Receivables Purchase Agreement shall have been executed and
delivered by the parties thereto and shall be in full force and effect and all
conditions to the initial sale of Receivables thereunder shall have been
satisfied.
(e) This amendment shall have been executed and delivered by the
parties hereto.
(f) Chase USA shall have delivered to the Trustee an Officer's
Certificate confirming the items set forth in clauses (a) through (d) above.
The Trustee may conclusively rely on such Officer's Certificate, shall have no
duty to make inquiries with regard to the matters set forth therein and shall
incur no liability in so relying.
SECTION 14.02. Assumption. On the Substitution Date and without any
further action on the part of any party hereto, LLC shall become the
Transferor hereunder and shall assume all of the covenants and obligations
including obligations under Section 7.04, and shall be entitled to all of the
benefits, of the Transferor hereunder. Simultaneously with such assumption,
Chase USA shall automatically be released from all of such obligations and
shall thereupon cease to be a party to this Agreement as Transferor. For the
avoidance of doubt, such assumption and release is equally effective for all
Series Supplements in effect on the Substitution Date and all agreements
relating to Series Enhancement in effect on the Substitution Date and for each
Transfer and Administration Agreement, Loan Agreement, Collateral Agreement,
Purchase Agreement, Security Agreement or other agreement entered into in
connection with any Series Supplement in effect on the Substitution Date to
which Chase USA is party in its capacity as Transferor, and by its execution
of this Agreement LLC shall assume the performance of all obligations of the
Transferor thereunder.
95
IN WITNESS WHEREOF, the Bank, as Transferor prior to the
Substitution Date, Card Acquisition Funding LLC, as Transferor, the Bank, as
the Servicer and the Trustee have caused this Agreement to be duly executed by
their respective officers as of the day and year first above written.
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION,
as Transferor prior to the Substitution Date and as Servicer,
By: /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Title: President
CARD ACQUISITION FUNDING LLC,
as Transferor after the Substitution Date,
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: President
BANKERS TRUST COMPANY, not in its individual capacity, but
solely as Trustee,
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇
-----------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇
Title: Assistant Vice President
EXHIBIT A
FORM OF ASSIGNMENT OF RECEIVABLES IN ADDITIONAL
ACCOUNTS (As required by Section 2.08 of the Pooling
and Servicing Agreement)
ASSIGNMENT NO. OF RECEIVABLES IN ADDITIONAL ACCOUNTS dated as of
______, 200_, by and among CARD ACQUISITION FUNDING LLC, a Delaware limited
liability company as Transferor (together with its permitted successors and
assigns) (the "Transferor"), CHASE MANAHATTAN BANK USA, NATIONAL ASSOCIATION,
a banking corporation organized and existing under the laws of the United
States (together with its permitted successors and assigns) as Servicer
("Servicer") and BANKERS TRUST COMPANY, a New York banking corporation as
Trustee ("Trustee") pursuant to the Pooling and Servicing Agreement referred
to below.
W I T N E S S E T H :
WHEREAS, the Transferor, Servicer and the Trustee are parties to the
Pooling and Servicing Agreement dated as of June 1, 1993, as amended and
restated on February 5, 2002 (as amended and supplemented, the "Agreement");
WHEREAS, pursuant to the Agreement, the Transferor wishes to
designate Additional Accounts owned by the Account Owners to be included as
Accounts and to convey the Receivables of such Additional Accounts, whether
now existing or hereafter created, to the Trust as part of the corpus of the
Trustee (as each such term is defined in the Agreement); and
WHEREAS, the Trustee is willing to accept such designation and
conveyance subject to the terms and conditions hereof;
NOW, THEREFORE, the Transferor and the Trustee hereby agree as
follows:
1. Defined Terms. All capitalized terms defined in this Assignment
and used herein shall have the meanings ascribed to them in the Agreement
unless otherwise defined herein.
"Addition Date" shall mean, with respect to the Additional Accounts
designated hereby, _______, 200_.
"Additional Cut-Off Date" shall mean, with respect to the Additional
Accounts designated hereby,_________, 200_.
2. Designation of Additional Accounts. On or before the Document
Delivery Date, the Tranferor will deliver to the Trustee a computer file or
microfiche list containing a true and complete schedule identifying all such
Additional Accounts specifying for each such Account, as of the Additional
Cut-Off Date, its account number, the aggregate amount outstanding in such
Account and the aggregate amount of Principal Receivables outstanding in such
Account, which computer file or microfiche list shall supplement Schedule I to
the Agreement.
A-1
3. Conveyance of Receivables.
(a) The Transferor does hereby transfer, assign, set over and other-
wise convey to the Trustee without recourse on and after the Addition Date, all
its right, title and interest in, to and under the Receivables of such
Additional Accounts, without recourse owned by the Transferor existing at the
close of business on the Additional Cut-Off Date and thereafter created from
time to time until the termination of the Trust, all monies due or to become
due with respect thereto and all proceeds (including "proceeds" as defined in
the UCC) thereof.
(b) In connection with the assignment, the Tranferor agrees to
record and file, at its own expense, financing statements (and continuation
statements when applicable) with respect to the Receivables now in Additional
Accounts owned by the Account Owners, meeting the requirements of applicable
state law in such manner and in such jurisdictions as are necessary to
perfect, and maintain perfection of, the sale and assignment of such
Receivables to the Trust, and to deliver a file-stamped copy of each such
financing statement or other evidence of such filing to the Trustee on or
prior to the Addition Date. The Trustee shall be under no obligation
whatsoever to file such financing or continuation statements or to make any
other filing under the UCC in connection with such sale and assignment.
(c) In connection with such sale, the Transferor further agrees, at
its own expense, on or prior to the date of this Assignment, to indicate in
the appropriate computer files that Receivables created in connection with the
Additional Accounts owned by the Account Owners and designated hereby have
been conveyed to the Transferor pursuant to the Agreement and this Assignment.
(d) The parties hereto intend that each transfer of Receivables and
other property pursuant pursuant to this Assignment constitutes a sale, and
not a secured borrowing, for all purposes.
4. Acceptance by Trustee. The Trustee hereby acknowledges its
acceptance of all right, title and interest to the property, now existing and
hereafter created, conveyed to the Trustee pursuant to Section 3(a) of this
Assignment, and declares that it shall maintain such right, title and
interest, upon the trust set forth in the Agreement for the benefit of all
Investor Certificateholders.
5. Representations and Warranties of the Transferor. The Transferor
hereby severally represents and warrants to the Trustee as of the Addition
Date that the representations and warranties of the Transferor set forth in
the Agreement that are to be made as of the Addition Date with respect to this
assignment are true and correct as of such date.
(a) Legal, Valid and Binding Obligation. This Assignment constitutes
a legal, valid and binding obligation of the Transferor enforceable against
the Transferor in accordance with its terms, except as such enforceability may
be limited by applicable Debtor Relief Laws and except as such enforceability
may be limited by general principles of equity (whether considered in a suit
at law or in equity).
(b) Eligibility of Accounts. With respect to additional accounts, on
the applicable Addition Date, each related Additional Account is an Eligible
Account.
A-2
(c) Insolvency. As of each of the Additional Cut-Off Date and the
Addition Date, no Insolvency Event with respect to the Transferor has occurred
and the transfer of Receivables arising in the Additional Accounts to the
Trust has not been made in contemplation of the occurrence thereof.
(d) Pay Out Event. The Transferor reasonably believes that (i) the
addition of the Receivables arising in the Additional Accounts will not, based
on the facts known to the Transferor, then or thereafter cause a Pay Out Event
to occur with respect to any Series and (ii) no selection procedure was
utilized by the Transferor or the Account Owner which would result in the
selection of Additional Accounts (from among the available Eligible Accounts
owned by the Account Owners) that would be materially adverse to the interests
of the Investor Certificateholders of any Series as of the Addition Date.
(e) Security Interest. This Assignment constitutes a valid sale,
transfer and assignment to the Trust of all right, title and interest of the
Transferor in the Receivables now existing or hereafter created in the
Additional Accounts designated by the Transferor, all monies due or to become
due and all amounts received with respect thereto and the "proceeds"
(including "proceeds" as defined in the UCC) thereof.
(f) No Conflict. Each Receivables conveyed to the Trust as of the
related Addition Date has been conveyed to the Trust free and clear of any
Lien of any Person claiming through or under the Transferor or any of its
Affliliates and in compliance, in all material respects, with all Requirements
of Law applicable to the Transferor.
(h) All Consents. All authorizations, consents, orders or approvals
of any court or other Governmental Authority required to be obtained by the
Transferor in connection with the execution and delivery of this Assignment
and the Transferor's performance of the transactions contemplated by this
Assignment by the Transferor, have been obtained.
6. Ratification Of Agreement. As supplemented by this Assignment,
the Agreement is in all respects ratified and confirmed and the Agreement as
so supplemented by this Assignment shall be read, taken and construed as one
and the same instrument.
7. Counterparts. This Assignment may be executed in two or more
counterparts, and by different parties on separate counterparts, each of which
shall be an original, but all of which shall constitute one and the same
instrument.
8. GOVERNING LAW. THIS ASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
A-4
IN WITNESS WHEREOF, the Transferor and the Trustee have caused this
Assignment to be duly executed by their respective officers as of the day and
year first above written.
CARD ACQUISITION FUNDING LLC
as Transferor,
By:
----------------------------------------------
Name:
Title:
BANKERS TRUST COMPANY, not in its individual capacity,
but solely as Trustee,
By:
----------------------------------------------
Name:
Title:
EXHIBIT B
FORM OF REASSIGNMENT OF RECEIVABLES IN
ACCOUNTS (As required by Section 2.09 of the Pooling
and Servicing Agreement)
REASSIGNMENT No. ______ OF RECEIVABLES dated as of _______, 200_ by
and among Card Acqusition Funding LLC, a Delaware limited liability company as
Transferor ("Transferor"), Chase Manhattan Bank USA, National Association, a
national banking association, Servicer (the "Servicer"), and BANKERS TRUST
COMPANY, a New York banking corporation (the "Trustee"), pursuant to the
Pooling and Servicing Agreement referred to below.
WITNESSETH:
WHEREAS, the Transferor, the Servicer and the Trustee are parties to
the Pooling and Servicing Agreement dated as of June 1, 1993, amended and
restated as of February 5, 2002 (as amended and supplemented, the
"Agreement");
WHEREAS, pursuant to the Agreement, the Transferor wishes to remove
from the Trust all Receivables in certain designated Accounts (the "Removed
Accounts") and to cause the Trustee to reconvey the Receivables of such
Removed Accounts, whether now existing or hereafter created, from the Trust to
the Transferor; and
WHEREAS, the Trustee is willing to accept such designation and to
reconvey the Receivables in the Removed Accounts subject to the terms and
conditions hereof.
NOW, THEREFORE, the Transferor and the Trustee hereby agree as
follows:
1. Defined Terms. All terms defined in the Agreement and used herein
shall have such defined meanings when used herein, unless otherwise defined
herein.
"Removal Date" shall mean, with respect to Removed Accounts
designated hereby, ____________, 200_.
"Removal Notice Date" shall mean, with respect to the Removed
Accounts, ____________, 200_.
2. Designation of Removed Accounts. On or before the date that is 10
Business Days after the Removal Date, the Transferor will deliver to the
Trustee a computer file or microfiche list containing a true and complete
schedule identifying all Accounts the Receivables of which are being removed
from the Trust, specifying for each such Account, as of the Removal Notice
Date, its account number, the aggregate amount outstanding in such Account and
the aggregate amount of Principal Receivables in such Account, which computer
file or microfiche list shall supplement Schedule 1 to the Agreement.
B-1
3. Conveyance of Receivables. (a) The Trustee does hereby transfer,
assign, set over and otherwise convey to the Transferor, without recourse, on
and after the Removal Date, all right, title and interest of the Trustee and
the Trust in, to and under the Receivables existing at the close of business
on the Removal Date and thereafter created from time to time in the Removed
Accounts designated hereby which are owned by such Participating Transferor,
all monies due or to become due and all amounts received with respect thereto
and all proceeds thereof but excluding all Recoveries relating thereto
resulting from the sale or re-securitization of Receivables pursuant to a
Grouped Charge Off Disposition.
(b) In connection with such transfer, the Trustee agrees to execute
and deliver to the Transferors on or prior to the date this Reassignment is
delivered, applicable termination statements with respect to the Receivables
existing at the close of business on the Removal Date and thereafter created
from time to time in the Removed Accounts reassigned hereby and the proceeds
thereof evidencing the release by the Trust of its interest in the Receivables
in the Removed Accounts, and meeting the requirements of applicable state law,
in such manner and such jurisdictions as are necessary to terminate such
interest.
4. Representations and Warranties of the Transferor. Each of the
Transferors hereby severally represents and warrants to the Trustee, on behalf
of the Trust, as of the Removal Date:
(a) Legal, Valid and Binding Obligation. This Reassignment
constitutes a legal, valid and binding obligation of the Transferor
enforceable against such Transferor, in accordance with its terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
affecting the enforcement of creditors' rights in general and the rights of
creditors of national banking associations and except as such enforceability
may be limited by general principles of equity (whether considered in a suit
at law or in equity).
(b) Pay Out Event. The Transferor reasonably believes that (i) the
removal of the Receivables existing in the Removed Accounts owned by the
Transferor will not, based on the facts known to such Transferor, then or
thereafter cause a Pay Out Event to occur with respect to any Series and (ii)
no selection procedure was utilized by the Transferor which would result in a
selection of Removed Accounts that would be materially adverse to the
interests of the Investor Certificateholders of any Series as of the Removal
Date.
(c) List of Removed Accounts. The list of Removed Accounts delivered
pursuant to Section 2.09(b) of the Agreement is true and complete in all
material respects as of the Removal Date (except that the balances set forth
in such list of Removed Accounts are true and correct in all material respects
as of the Removal Notice Date).
5. Ratification of Agreement. As supplemented by this Reassignment,
the Agreement is in all respects ratified and confirmed and the Agreement as
so supplemented by this Reassignment shall be read, taken and construed as one
and the same instrument.
B-2
6. Counterparts. This Reassignment may be executed in two or more
counterparts, and by different parties on separate counterparts, each of which
shall be an original, but all of which shall constitute one and the same
instrument.
7. GOVERNING LAW. THIS REASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF NEW YORK AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH
LAWS.
IN WITNESS WHEREOF, the Transferor and the Trustee have caused this
Reassignment to be duly executed by their respective officers as of the day
and year first above written.
CARD ACQUISITION FUNDING, as Transferor
By: __________________________________
Name:
Title:
CHASE MANHATTAN BANK USA, as Servicer
By: __________________________________
Name:
Title:
BANKERS TRUST COMPANY, not in its individual
capacity, but solely as Trustee,
By: __________________________________
Name:
Title:
B-3
EXHIBIT C
FORM OF ANNUAL SERVICER'S CERTIFICATE
(To be delivered on or before March 31 of each calendar
year beginning with March 31, 200_, pursuant to
Section 3.05 of the Pooling and Servicing Agreement
referred to below)
CHASE MANHATTAN BANK USA
--------------------------------------
PROVIDIAN MASTER TRUST
--------------------------------------
The undersigned, a duly authorized representative of Chase Manhattan
Bank USA, National Association, as Servicer ("Chase USA"), pursuant to the
Pooling and Servicing Agreement dated as of June 1, 1993, as amended and
restated as of February 5, 2002 (as amended and supplemented, the
"Agreement"), among Card Acquisition Funding LLC as Transferor, Chase USA, as
Servicer, and Bankers Trust Company, as Trustee, does hereby certify that:
1. Chase USA is, as of the date hereof, the Servicer under the
Agreement. Capitalized terms used in this Certificate have their respective
meanings as set forth in the Agreement.
2. The undersigned is a servicing officer who is duly authorized
pursuant to the Agreement to execute and deliver this Certificate to the
Trustee.
3. A review of the activities of the Servicer during the calendar
year ended December 31, 200_, and of its performance under the Agreement was
conducted under my supervision.
4. Based on such review, the Servicer has, to the best of my
knowledge, performed in all material respects its obligations under the
Agreement throughout such year and no default in the performance of such
obligations has occurred or is continuing except as set forth in paragraph 5
below.
5. The following is a description of each default in the performance
of the Servicer's obligations under the provisions of the Agreement known to
me to have been made by the Servicer during the year ended December 31, 200_,
which sets forth in detail (a) the nature of each such default, (b) the action
taken by the Servicer, if any, to remedy each such default and (c) the current
status of each such default: [if applicable, insert "None."]
c-1
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this day of __________, 200_ .
CHASE MANHATTAN BANK USA, NATIONAL
ASSOCIATION, as Servicer,
By:
------------------------------------
Name:
Title:
C-2
EXHIBIT E-1
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "1933 ACT"). NEITHER THIS CERTIFICATE NOR ANY PORTION
HEREOF MAY BE OFFERED OR SOLD EXCEPT IN COMPLIANCE WITH THE REGISTRATION
PROVISIONS OF THE 1933 ACT AND ANY APPLICABLE PROVISIONS OF ANY STATE BLUE SKY
OR SECURITIES LAWS OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH
REGISTRATION PROVISIONS. THE TRANSFER OF THIS CERTIFICATE IS SUBJECT TO
CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED
TO HEREIN.
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A
BENEFIT PLAN (AS DEFINED BELOW).
E-1
EXHIBIT E-2
FORM OF UNDERTAKING LETTER
_______________, 200_
Bankers Trust Company
Four ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention:
Chase Manhattan Bank USA, National Association
▇▇▇▇▇ ▇▇▇▇ Center Building ▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Card Acquisition Funding LLC
▇▇▇▇▇ ▇▇▇▇ Center Building ▇▇▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Re: Purchase of $______ principal amount of
Providian Master Trust, [ %]
Asset Backed Certificates, Series [ ]
Ladies and Gentlemen:
In connection with our purchase of the above Asset Backed
Certificates (the "Certificates") we confirm that:
(i) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the "1933 Act"), and are
being sold to us in a transaction that is exempt from the registration
requirements of the 1933 Act;
(ii) any information we desire concerning the Certificates or any
other matter relevant to our decision to purchase the Certificates is or
has been made available to us;
(iii) we have such knowledge and experience in financial and
business matters as to be capable of evaluating the merits and risks of
an investment in the Certificates, and we (and any account for which we
are purchasing under paragraph (iv) below) are able to bear the economic
risk of an investment in the Certificates; we (and any account for which
we are purchasing under paragraph (iv) below) are an "accredited
investor" (as
E-1
such term is defined in Rule 501(a)(1), (2) or (3) of Regulation D under
the ▇▇▇▇ ▇▇▇); and we are not, and none of such accounts is, a Benefit
Plan;
(iv) we are acquiring the Certificates for our own account or for
accounts as to which we exercise sole investment discretion and not with
a view to any distribution of the Certificates, subject, nevertheless, to
the understanding that the disposition of our property shall at all times
be and remain within our control;
(v) we agree that the Certificates must be held indefinitely by us
unless subsequently registered under the 1933 Act or an exemption from
any registration requirements of that Act and any applicable state
securities law is available;
(vi) we agree that in the event that at some future time we wish to
dispose of or exchange any of the Certificates (such disposition or
exchange not being currently foreseen or contemplated), we will not
transfer or exchange any of the Certificates unless:
(A)(1) the sale is of at least U.S. $_____ principal amount of
Certificates to an Eligible Purchaser (as defined below), (2) a
letter to substantially the same effect as paragraphs (i), (ii),
(iii), (iv), (v) and (vi) of this letter is executed promptly by the
purchaser and (3) all offers or solicitations in connection with the
sale, whether directly or through any agent acting on our behalf,
are limited only to Eligible Purchasers and are not made by means of
any form of general solicitation or general advertising whatsoever;
or
(B) the Certificates are transferred pursuant to Rule 144 under
the 1933 Act by us after we have held them for more than three
years; or
(C) the Certificates are sold in any other transaction that
does not require registration under the 1933 Act and, if the
Transferors, the Servicer, the Trustee or the Transfer Agent and
Registrar so requests, we theretofore have furnished to such party
an opinion of counsel satisfactory to such party, in form and
substance satisfactory to such party, to such effect; or
(D) the Certificates are transferred pursuant to an exception
from the registration requirements of the 1933 Act under Rule 144A
under the 1933 Act; and
(vii) we understand that the Certificates will bear a legend to
substantially the following effect:
"THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
OF 1933, AS AMENDED (THE "1933 ACT"). NEITHER THIS CERTIFICATE NOR ANY PORTION
HEREOF MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN
COMPLIANCE WITH THE REGISTRATION PROVISIONS OF THE 1933 ACT AND ANY APPLICABLE
PROVISIONS OF ANY STATE BLUE SKY OR SECURITIES LAWS OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM SUCH PROVISIONS. THE TRANSFER OF THIS CERTIFICATE IS
SUBJECT TO CERTAIN CONDITIONS SET
E-2
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN."
"THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A
BENEFIT PLAN (AS DEFINED BELOW)."
The first paragraph of this legend may be removed if the Transferor,
the Servicer, the Trustee and the Transfer Agent and Registrar have received
an opinion of counsel satisfactory to them, in form and substance satisfactory
to them, to the effect that such paragraph may be removed.
"Eligible Purchaser" means either an Eligible Dealer or a
corporation, partnership or other entity which we have reasonable grounds to
believe and do believe can make representations with respect to itself to
substantially the same effect as the representations set forth herein.
"Eligible-Dealer" means any corporation or other entity the
principal business of which is acting as a broker and/or dealer in securities.
"Benefit Plan" means any employee benefit plan, trust or account,
including an individual retirement account, that is subject to the Employee
Retirement Income Security Act of 1974, as amended, or that is described in
Section 4975(e)(1) of the Internal Revenue Code of 1986, as amended, or an
entity whose underlying assets include plan assets by reason of a plan's
investment in such entity.
Capitalized terms used but not defined herein shall have the
meanings given to such terms in the Pooling and Servicing Agreement dated as
of June 1, 1993, as amended from time to time among Card Acquisition Funding
LLC, as Transferor, Chase Manhattan Bank, USA, National Association, as
Servicer and Bankers Trust Company, as Trustee.
Very truly yours,
----------------------------------
(Name of Purchaser)
By: ______________________________
(Authorized Officer)
E-3
EXHIBIT E-3
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A
BENEFIT PLAN (AS DEFINED BELOW).*
--------------
* The following text should be included in any Certificate in which the
above legend appears:
The (Certificates) may not be acquired by or for the account of any
employee benefit plan, trust or account, including an individual
retirement account, that is subject to the Employee Retirement
Income Security Act of 1974, as amended, or that is described in
Section 4975(e)(1) of the Internal Revenue Code of 1986, as amended,
or an entity whose underlying assets include plan assets by reason
of a plan's investment in such entity (a "Benefit Plan"). By
accepting and holding this Certificate, the Holder hereof shall be
deemed to have represented and warranted that it is not a Benefit
Plan. By acquiring any interest in this Certificate, the applicable
Certificate Owner or Owners shall be deemed to have represented and
warranted that it or they are not Benefit Plans.
E-1
EXHIBIT F
BOOK-ENTRY-ONLY COLLATERALIZED MORTGAGE OBLIGATIONS
(CMOs)(WITHOUT OWNER OPTION TO REDEEM)OTHER ASSET-BACKED
SECURITIES AND PASS-THROUGH CERTIFICATES(1)
Letter of Representations
[To be Completed by Issuer and Trustee]
---------------------------------------
[Name of Issuer]
---------------------------------------
[Name of Trustee]
-----------------
(Date)
Attention: General Counsel's Office
The Depository Trust Company
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Re: _________________________________________________
-------------------------------------------------
-------------------------------------------------
(Issue Description)
Ladies and Gentlemen:
This letter sets forth our understanding with respect to certain
matters relating to the above-referenced issue (the "Securities"). Trustee
will act as trustee with respect to the Securities pursuant to a trust
indenture dated _____________, 199__ (the "Document"). ______________
("Underwriter") is distributing the Securities through The Depository Trust
Company ("DTC").
To induce DTC to accept the Securities as eligible for deposit at
DTC, and to act in accordance with its Rules with respect to the Securities,
Issuer and Trustee make the following representations to DTC:
-----------------
(1) This document is a DTC form and may be amended by the parties.
F-1
1. Prior to closing on the Securities on ____________, 199__, there
shall be deposited with DTC one Security certificate registered in the name of
DTC's nominee, Cede & Co., for each stated maturity of the Securities in the
face amounts set forth on Schedule A hereto, the total of which represents
100% of the principal amount of such Securities. If, however, the aggregate
principal amount of any maturity exceeds $150 million, one certificate will be
issued with respect to each $150 million of principal amount and an additional
certificate will be issued with respect to any remaining principal amount.
Each $150 million certificate shall bear the following legend:
Unless this certificate is presented by an authorized representative
of The Depository Trust Company, a New York corporation ("DTC"), to
Issuer or its agent for registration of transfer, exchange, or payment,
and any certificate issued is registered in the name of Cede & Co. or in
such other name as is requested by an authorized representative of DTC
(and any payment is made to Cede & Co. or to such other entity as is
requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE,
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an
interest herein.
2. In the event of any solicitation of consents from or voting by
holders of the Securities, Issuer or Trustee shall establish a record date for
such purposes (with no provision for revocation of consents or votes by
subsequent holders) and shall, to the extent possible, send notice of such
record date to DTC not less than 15 calendar days in advance of such record
date. Notices to DTC pursuant to this Paragraph by telecopy shall be sent to
DTC's Reorganization Department at (▇▇▇) ▇▇▇-▇▇▇▇ or (▇▇▇) ▇▇▇-▇▇▇▇, and
receipt of such notices shall be confirmed by telephoning (▇▇▇) ▇▇▇-▇▇▇▇.
Notices to DTC pursuant to this Paragraph by mail or by any other means shall
be sent to DTC's Reorganization Department as indicated in Paragraph 4.
3. In the event of a full or partial redemption, Issuer or Trustee
shall send a notice to DTC specifying: (a) the amount of the redemption or
refunding; (b) in the case of a refunding, the maturity date(s) established
under the refunding; and (c) the date such notice is to be mailed to Security
holders or published (the "Publication Date"). Such notice shall be sent to
DTC by a secure means (e.g., legible telecopy, registered or certified mail,
overnight delivery) in a timely manner designed to assure that such notice is
in DTC's possession no later than the close of business on the business day
before or, if possible, two business days before the Publication Date. Issuer
or Trustee shall forward such notice either in a separate secure transmission
for each CUSIP number or in a secure transmission for multiple CUSIP numbers
(if applicable) which includes a manifest or list of each CUSIP number
submitted in that transmission. (The party sending such notice shall have a
method to verify subsequently the use of such means and the timeliness of such
notice.) The Publication Date shall be not less than 30 days nor more than 60
days prior to the redemption date or, in the case of an advance refunding, the
date that the proceeds are deposited in escrow. Notices to DTC pursuant to
this Paragraph by telecopy shall be sent to DTC's Call Notification Department
at (▇▇▇) ▇▇▇-▇▇▇▇ or (▇▇▇) ▇▇▇-▇▇▇▇. If the party sending the notice does not
receive a telecopy receipt from DTC confirming that the notice has been
received, such party shall telephone (▇▇▇) ▇▇▇-▇▇▇▇. Notices to DTC pursuant
to this Paragraph by mail or by any other means shall be sent to:
F-2
Manager; Call Notification Department
The Depository Trust Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
4. In the event of an invitation to tender the Securities, notice by
Issuer or Trustee to Security holders specifying the terms of the tender and
the Publication Date of such notice shall be sent to DTC by a secure means in
the manner set forth in the preceding Paragraph. Notices to DTC pursuant to
this Paragraph and notices of other corporate actions (including mandatory
tenders, exchanges, and capital changes) by telecopy shall be sent to DTC's
Reorganization Department at (▇▇▇) ▇▇▇-▇▇▇▇ or (▇▇▇) ▇▇▇-▇▇▇▇, and receipt of
such notices shall be confirmed by telephoning (▇▇▇) ▇▇▇-▇▇▇▇. Notices to DTC
pursuant to the above by mail or by any other means shall be sent to:
Manager; Reorganization Department
Reorganization Window
The Depository Trust Company
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
5. All notices and payment advices sent to DTC shall contain the
CUSIP number of the Securities.
6. Trustee shall send DTC written notice with respect to the dollar
amount per $1,000 original face value (or other minimum authorized
denomination if less than $1,000 face value) payable on each payment date
allocated as to the interest and principal portions thereof preferably five,
but not less than two, business days prior to such payment date. Such notices,
which shall also contain the current pool factor and Trustee contact's name
and telephone number, shall be sent by telecopy to DTC's Dividend Department
at (▇▇▇) ▇▇▇-▇▇▇▇, or if by mail or by any other means to:
Manager; Announcements Dividend Department
The Depository Trust Company
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
7. [Note: Issuer must represent one of the following, and cross out
the other:] [The interest accrual period is record date to record date.] [The
interest accrual period is payment date to payment date.]
8. Interest payments and principal payments that are part of
periodic principal-and-interest payments shall be received by Cede & Co., as
nominee of DTC, or its registered assigns in same-day funds on each payment
date (or the equivalent in accordance with existing arrangements between
Issuer or Trustee and DTC). Such payment shall be made payable to the order of
Cede & Co. Absent any other existing arrangements, such payments shall be
addressed as follows:
F-3
Manager; Cash Receipts
Dividend Department
The Depository Trust Company
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
9. [Note: Issuer must represent one of the following, and cross out
the other:]
Securities Eligible for DTC's Same-Day Funds Settlement ("SDFS")
System.
Other principal payments (redemption payments) shall be made in
same-day funds by Trustee in the manner set forth in the SDFS Paying Agent
Operating Procedures, a copy of which previously has been furnished to
Trustee.
Securities Eligible for DTC's Next-Day Funds Settlement ("NDFS")
System.
Other principal payments (redemption payments) shall be made in
next-day funds by Trustee to Cede & Co., as nominee of DTC, or its registered
assigns, on each payment date. Such payments shall be made payable to the
order of Cede & Co., and shall be addressed as follows:
NDFS Redemptions Manager
Reorganization/Redemptions Department
The Depository Trust Company
▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
10. DTC may direct Issuer or Trustee to use any other number or
address as the number or address to which notices or payments of interest or
principal may be sent.
11. In the event of a redemption, acceleration, or any other similar
transaction (e.g., tender made and accepted in response to Issuer's or
Trustee's invitation) necessitating a reduction in the aggregate principal
amount of Securities outstanding or an advance refunding of part of the
Securities outstanding, DTC, in its discretion: (a) may request Issuer or
Trustee to issue and authenticate a new Security certificate; or (b) may make
an appropriate notation on the Security certificate indicating the date and
amount of such reduction in principal except in the case of final maturity, in
which case the certificate will be presented to Issuer or Trustee prior to
payment, if required.
12. In the event that Issuer determines that beneficial owners of
Securities shall be able to obtain certificated Securities, Issuer or Trustee
shall notify DTC of the availability of certificates. In such event, Issuer or
Trustee shall issue, transfer, and exchange certificates in appropriate
amounts, as required by DTC and others.
13. DTC may discontinue providing its services as securities
depository with respect to the Securities at any time by giving reasonable
notice to Issuer or Trustee (at which time DTC will confirm with Issuer or
Trustee the aggregate principal amount of Securities outstanding). Under such
circumstances, at DTC's request Issuer and Trustee shall cooperate
F-4
fully with DTC by taking appropriate action to make available one or more
separate certificates evidencing Securities to any DTC Participant having
Securities credited to its DTC accounts.
14. Issuer: (a) understands that DTC has no obligation to, and will
not, communicate to its Participants or to any person having an interest in
the Securities any information contained in the Security certificate(s); and
(b) acknowledges that neither DTC's Participants nor any person having an
interest in the Securities shall be deemed to have notice of the provisions of
the Security certificates by virtue of submission of such certificate(s) to
DTC.
15. Nothing herein shall be deemed to require Trustee to advance
funds on behalf of Issuer.
F-5
Notes: Very truly yours,
A. If there is a Trustee (as defined
in this Letter of Representations), Trustee
as well as Issuer must sign this
Letter. If there is no Trustee,
in signing this Letter Issuer itself ---------------------------------
undertakes to perform all of the (Issuer)
obligations set forth herein.
By: ----------------------------------
B. Schedule B contains statements (Authorized Officer's Signature)
that DTC believes accurately describe
DTC, the method of effecting
book-entry transfers of securities ----------------------------------
distributed through DTC, and (Trustee)
certain related matters.
By: ---------------------------------
(Authorized Officer's Signature)
Received and Accepted:
THE DEPOSITORY TRUST COMPANY
By: _______________________
cc: Underwriter
Underwriter's Counsel
E-6
SCHEDULE A
(Describe Issue)
CUSIP Principal Amount Maturity Date Interest Rate
F-7
SCHEDULE B
SAMPLE OFFERING DOCUMENT LANGUAGE
DESCRIBING BOOK-ENTRY-ONLY ISSUANCE
(Prepared by DTC-bracketed material may be
applicable only to certain issues)
1. The Depository Trust Company ("DTC"), New York, NY, will act as
securities depository for the securities (the "Securities"). The Securities
will be issued as fully registered securities registered in the name of Cede &
Co. (DTC's partnership nominee). One fully registered Security certificate
will be issued for [each issue of] the Securities [each] in the aggregate
principal amount of such issue, and will be deposited with DTC. [If, however,
the aggregate principal amount of [any] issue exceeds $150 million, one
certificate will be issued with respect to each $150 million of principal
amount and an additional certificate will be issued with respect to any
remaining principal amount of such issue.]
2. DTC is a limited-purpose trust company organized under the New
York Banking Law, a "banking organization" within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a "clearing corporation"
within the meaning of the New York Uniform Commercial Code, and a "clearing
agency" registered pursuant to the provisions of Section 17A of the Securities
Exchange Act of 1934. DTC holds securities that its participants
("Participants") deposit with DTC. DTC also facilitates the settlement among
Participants of securities transactions, such as transfers and pledges, in
deposited securities through electronic computerized book-entry changes in
Participants' accounts, thereby eliminating the need for physical movement of
securities certificates. Direct Participants include securities brokers and
dealers, banks, trust companies, clearing corporations, and certain other
organizations. DTC is owned by a number of its Direct Participants and by the
New York Stock Exchange, Inc., the American Stock Exchange, Inc. and the
National Association of Securities Dealers, Inc. Access to the DTC system is
also available to others such as securities brokers and dealers, banks, and
trust companies that clear through or maintain a custodial relationship with a
Direct Participant, either directly or indirectly ("Indirect Participants").
The Rules applicable to DTC and its Participants are on file with the
Securities and Exchange Commission.
3. Purchase of Securities under the DTC system must be made by or
through Direct Participants, which will receive a credit for the Securities on
DTC's records. The ownership interest of each actual purchaser of each
Security ("Beneficial Owner") is in turn to be recorded on the Direct and
Indirect Participants' records. Beneficial Owners will not receive written
confirmation from DTC of their purchase, but Beneficial Owners are expected to
receive written confirmations providing details of the transaction, as well as
periodic statements of their holdings, from the Direct or Indirect Participant
through which the Beneficial Owner entered into the transaction. Transfers of
ownership interests in the Securities are to be accomplished by entries made
on the books of Participants acting on behalf of Beneficial Owners. Beneficial
Owners will not receive certificates representing their ownership interests in
Securities, except in the event that use of the book-entry system for the
Securities is discontinued.
F-8
4. To facilitate subsequent transfers, all Securities deposited by
Participants with DTC are registered in the name of DTC's partnership nominee,
Cede & Co. The deposit of Securities with DTC and their registration in the
name of Cede & Co. effect no change in beneficial ownership. DTC has no
knowledge of the actual Beneficial Owners of the Securities; DTC's records
reflect only the identity of the Direct Participants to whose accounts such
Securities are credited, which may or may not be the Beneficial Owners. The
Participants will remain responsible for keeping account of their holdings on
behalf of their customers.
5. Conveyance of notices and other communications by DTC to Direct
Participants, by Direct Participants to Indirect Participants, and by Direct
Participants and Indirect Participants to Beneficial Owners will be governed
by arrangements among them, subject to any statutory or regulatory
requirements as may be in effect from time to time.
[6. Redemption notices shall be sent to Cede & Co. If less than all
of the Securities within an issue are being redeemed, DTC's practice is to
determine by lot the amount of the interest of each Direct Participant in such
issue to be redeemed.]
7. Neither DTC nor CEDE & Co. will consent or vote with respect to
Securities. Under its usual procedures, DTC mails an Omnibus Proxy to the
Issuer as soon as possible after the record date. The Omnibus Proxy assigns
Cede & Co.'s consenting or voting rights to those Direct Participants to whose
accounts the Securities are credited on the record date (identified in a
listing attached to the Omnibus Proxy).
8. Principal and interest payments on the Securities will be made to
DTC. DTC's practice is to credit Direct Participants' accounts on payable date
in accordance with their respective holdings shown on DTC's records unless DTC
has reason to believe that it will not receive payment on payable date.
Payments by Participants to Beneficial Owners will be governed by standing
instructions and customary practices, as is the case with securities held for
the accounts of customers in bearer form or registered in "street name", and
will be the responsibility of such Participant and not of DTC, the Agent, or
the Issuer, subject to any statutory or regulatory requirements as may be in
effect from time to time. Payment of principal and interest to DTC is the
responsibility of the Issuer or the Agent, disbursement of such payments to
Direct Participants shall be the responsibility of DTC, and disbursement of
such payments to the Beneficial Owners shall be the responsibility of Direct
and Indirect Participants.
[9. A Beneficial Owner shall give notice to elect to have its
Securities purchased or tendered, through its Participant, to the
[Tender/Remarketing] Agent, and shall effect delivery of such Securities by
causing the Direct Participant to transfer the Participant's interest in the
Securities, on DTC's records, to the [Tender/Remarketing] Agent. The
requirement for physical delivery of Securities in connection with a demand
for purchase or a mandatory purchase will be deemed satisfied when the
ownership rights in the Securities are transferred by Direct Participants on
DTC's records.]
10. DTC may discontinue providing its services as securities
depository with respect to the Securities at any time by giving reasonable
notice to the Issuer or the Agent. Under such circumstances, in the event that
a successor securities depository is not obtained, Security certificates are
required to be printed and delivered.
F-9
11. The Issuer may decide to discontinue use of the system of
book-entry traders through DTC (or a successor securities depository). In that
event, Security certificates will be printed and delivered.
12. The information in this section concerning DTC and DTC's
book-entry system has been obtained from sources that the Issuer believes to
be reliable, but the Issuer takes no responsibility for the accuracy thereof.
F-10
EXHIBIT G-1
FORM OF CLEARANCE SYSTEM CERTIFICATE
TO BE GIVEN TO THE TRUSTEE BY
EUROCLEAR OR CEDE FOR
DELIVERY OF DEFINITIVE CERTIFICATES
IN EXCHANGE FOR A PORTION OF A
TEMPORARY GLOBAL SECURITY
PROVIDIAN MASTER TRUST,
[ ]% Asset Backed
Certificates, Series [ ]
[Insert title or sufficient description
of Certificates to be delivered]
We refer to that portion of the temporary Global Certificate in
respect of the above-captioned issue which is herewith submitted to be
exchanged for definitive Certificates (the "Submitted Portion") as provided in
the Pooling and Servicing Agreement dated as of June 1, 1993 as amended and
restated on February 5, 2002 (as amended and supplemented, the "Agreement"),
in respect of such issue. This is to certify that (i) we have received a
certificate or certificates, in writing or by tested telex, with respect to
each of the persons appearing in our records as being entitled to a beneficial
interest in the Submitted Portion and with respect to such persons, beneficial
interest either (a) from such person, substantially in the form of Exhibit G-2
to the Agreement, or (b) from [ ], substantially in the form of Exhibit G-3 to
the Agreement, and (ii) the Submitted Portion includes no part of the
temporary Global Certificate excepted in such certificates.
We further certify that as of the date hereof we have not received
any notification from any of the persons giving such certificates to the
effect that the statements made by them with respect to any part of the
Submitted Portion are no longer true and cannot be relied on as of the date
hereof.
We understand that this certificate is required in connection with
certain securities and tax laws in the United States of America. If
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate or a copy thereof to any interested party in
such proceedings.
Dated: _________, 200_* [_______________, as operator of the Euroclear
System]
By: ________________________________
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* To be dated on the Exchange Date.
G-1
EXHIBIT G-2
FORM OF CERTIFICATE TO BE DELIVERED
TO EUROCLEAR OR CEDE
BY ___________________________
WITH RESPECT TO REGISTERED CERTIFICATES SOLD TO
QUALIFIED INSTITUTIONAL BUYERS
PROVIDIAN MASTER TRUST,
[ ]% Asset Backed Certificates, Series [ ]
In connection with the initial issuance and placement of the
above-referenced Asset Backed Certificates (the "Certificates"), an
institutional investor in the United States ("institutional investor") is
purchasing U.S. $______ aggregate principal amount of the Certificates held in
our account at [_______________, as operator of the Euroclear System] [Cedel
S.A.] on behalf of such investor.
We reasonably believe that such institutional investor is a
qualified institutional buyer as such term is defined under Rule 144A of the
Securities Act of 1933, as amended.
[We understand that this certificate is required in connection with
United States laws. We irrevocably authorize you to produce this certificate
or a copy hereof to any interested party in any administrative or legal
proceedings or official inquiry with respect to the matters covered by this
certificate.]
The Definitive Certificates in respect of this certificate are to be
issued in registered form in the minimum denomination of U.S. $500,000 and
such Definitive Certificates (and, unless the Pooling and Servicing Agreement
or Supplement relating to the Certificates otherwise provides, any
Certificates issued in exchange or substitution for or on registration of
transfer of Certificates) shall bear the following legend:
"THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE UNITED
STATES SECURITIES ACT OF 1933. NEITHER THIS CERTIFICATE NOR ANY
PORTION HEREOF MAY BE OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE
UNITED STATES OR TO U.S. PERSONS (EACH AS DEFINED HEREIN), EXCEPT IN
COMPLIANCE WITH THE REGISTRATION PROVISIONS OF SUCH ACT OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION PROVISIONS. THE
TRANSFER OF THIS CERTIFICATE IS SUBJECT TO CERTAIN CONDITIONS SET
FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. THIS
CERTIFICATE CANNOT BE EXCHANGED FOR A BEARER CERTIFICATE."
Dated: , [ ],
By: ________________________
Authorized Officer
G-2
FORM OF CERTIFICATE TO BE DELIVERED
TO EUROCLEAR OR CEDE BY A BENEFICIAL OWNER
OF CERTIFICATES, OTHER THAN A QUALIFIED INSTITUTIONAL BUYER
PROVIDIAN MASTER TRUST,
[ ]% Asset Backed Certificates, Series [ ]
This is to certify that as of the date hereof and except as provided
in the third paragraph hereof, the above-captioned Certificates held by you
for our account (i) are owned by a person that is a United States person, or
(ii) are owned by a United States person that is (A) the foreign branch of a
United States financial institution (as defined in U.S. Treasury Regulations
Section 1.165-12(c)(1)(v)) (a "financial institution") purchasing for its own
account or for resale, or (B) a United States person who acquired the
Certificates through the foreign branch of a financial institution and who
holds the Certificates through the financial institution on the date hereof
(and in either case (A) or (B), the financial institution hereby agrees to
comply with the requirements of Section 165(j)(3)(A), (B) or (C) of the
Internal Revenue Code of 1986, as amended, and the regulations thereunder), or
(iii) are owned by a financial institution for purposes of resale during the
Restricted Period (as defined in U.S. Treasury Regulations Section
1.163-5(c)(2)(i)(D)(7)). In addition, financial institutions described in
clause (iii) of the preceding sentence (whether or not also described in
clause (i) or (ii)) certify that they have not acquired the Certificates for
purposes of resale directly or indirectly to a United States person or to a
person within the United States or its possessions.
We undertake to advise you by tested telex if the above statement as
to beneficial ownership is not correct on the date of delivery of the
above-captioned Certificates in bearer form with respect to such of said
Certificates as then appear in your books as being held for our account.
This Certificate excepts and does not relate to U.S. $____ principal
amount of certificates held by you for our account, as to which we are not yet
able to certify beneficial ownership. We understand that delivery of
Definitive Certificates in such principal amount cannot be made until we are
able to so certify.
We understand that this Certificate is required in connection with
certain securities and tax laws in the United States of America. If
administrative or legal proceedings are commenced or threatened in connection
with which this Certificate is or would be relevant, we irrevocably authorize
you to produce this certificate or a copy thereof to any interested party in
such proceedings. As used herein, "United States" means the United States of
America (including the States and the District of Columbia), its territories,
its possessions and other areas subject to its jurisdiction; and "United
States Person" means a citizen or resident of the United States, a
corporation, partnership or other entity created or organized in or under the
laws of the
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▇▇▇▇▇▇ ▇▇▇▇▇▇, or any political subdivision thereof, or an estate or trust the
income of which is subject to United States federal income taxation regardless
of its source.
Dated: * By: __________________________________
As, or as agent for, the beneficial owner(s) of
the interest in the Certificates to which this
Certificate relates.
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* This Certificate must be dated on the earlier of the date of the
first actual payment of interest in respect of the Certificates and
the date of the delivery of the Certificates in definitive form.
G-4
EXHIBIT H-1
FORM OF OPINION OF COUNSEL
WITH RESPECT TO AMENDMENTS
Provisions to be included in the
Opinion of Counsel to be
delivered pursuant to Section 13.01(d)(i)(2)
The opinions may be subject to all the qualifications, assumptions,
limitations and exceptions taken or made in the opinion of counsel delivered
on any applicable Closing Date or Substitution Date and shall address:
(a) The amendment to the [Pooling and Servicing Agreement],
[Supplement], attached hereto as Schedule 1 (the "Amendment"), has been duly
authorized, executed and delivered by the Transferors and constitutes the
legal, valid and binding agreement of the Transferors, enforceable in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other laws
from time to time in effect affecting creditors' rights generally or the
rights of creditors of national banking associations. The enforceability of
the Transferors' obligations is also subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law).
(b) The Amendment has been entered into in accordance with the terms
and provisions of Section 13.01 of the Pooling and Servicing Agreement.
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(2) The opinions or any portion hereof may be provided by one or more counsel.
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FORM OF OPINION OF COUNSEL
WITH RESPECT TO ACCOUNTS
Provisions to be included in the
Opinion of Counsel to be
delivered pursuant to Section 13.02(d)(iii)(3)
The opinions may be subject to all the qualifications, assumptions,
limitations and exceptions taken or made in the opinion of counsel delivered
on any applicable Closing Date or Substitution Date and shall address:
(a) The Agreement creates a valid security interest in favor of the
Trustee, for the benefit of the Certificateholders in the Transferors' right,
title and interest in and to the Receivables and the proceeds thereof.
(b) For purposes of Section 9-307 of the New York UCC, the Transfer
is located in [insert jurisdiction]. For purposes of Section 9-301 of the New
York UCC, the local law of [insert jurisdiction] governs perfection, the
effect of perfection or nonperfection and the priority of the security
interest in the Receivables in favor of the Trustee granted under the
Agreement;
(c) the security interest of the Trust in the Receivables
transferred from the LLC is perfected under the law of [insert applicable
jurisdiction].
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(3) The opinions or any portion thereof may be set forth by various
business firms in whole or in part as designated by the parties.
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FORM OF ANNUAL OPINION OF COUNSEL
Provisions to be included in the
Opinion of Counsel to be
delivered pursuant to Section 13.02(d)(iv)(4)
The opinions may be subject to all the qualifications, assumptions,
limitations and exceptions taken or made in the opinion of counsel delivered
on any applicable Closing Date or Substitution Date and shall address:
(a) The Agreement creates a valid security interest in favor of the
Trustee, for the benefit of the Certificateholders in the Transferors' right,
title and interest in and to the Receivables and the proceeds thereof.
(b) For purposes of Section 9-307 of the New York UCC, the Transfer
is located in [insert jurisdiction]. For purposes of Section 9-301 of the New
York UCC, the local law of [insert jurisdiction] governs perfection, the
effect of perfection or nonperfection and the priority of the security
interest in the Receivables in favor of the Trustee granted under the
Agreement;
(c) the security interest of the Trust in the Receivables
transferred from the LLC is perfected under the law of [insert applicable
jurisdiction].
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(4) The opinions or any portion thereof may be set forth by various business
firms in whole or in part as designated by the parties.
H-1
SCHEDULE 1
List of Accounts
[Original list delivered to Trustee]
H-1