Exhibit 10.7
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LFI RECEIVABLES MASTER TRUST
AMENDED AND RESTATED
POOLING AGREEMENT
Among
LFI RECEIVABLES CORPORATION
LFI SERVICING CORPORATION
as Master Servicer
and
THE CHASE MANHATTAN BANK
as Trustee
Dated as of February 4, 1997
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TABLE OF CONTENTS
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ARTICLE I
Definitions
SECTION 1.01. Definitions........................................... 2
SECTION 1.02. Other Definitional Provisions......................... 41
ARTICLE II
Conveyance of Receivables; Representations
Warranties and Covenants
SECTION 2.01. Conveyance of Receivables............................. 43
SECTION 2.02. Acceptance by Trustee................................. 47
SECTION 2.03. Representations and Warranties of
the Company Relating to the
Company............................................. 48
SECTION 2.04. Representations and Warranties of
the Company Relating to the
Receivables......................................... 54
SECTION 2.05. Adjustment Payment for Ineligible
Receivables......................................... 55
SECTION 2.06. Purchase of Investor
Certificateholders' Interest in
Trust Portfolio..................................... 57
SECTION 2.07. Affirmative Covenants of the
Company............................................. 58
SECTION 2.08. Negative Covenants of
the Company......................................... 64
TOC Amended and Restated Pooling Agreement Contents, p. 2
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ARTICLE III
Rights of Holders and
Allocation and Application of Collections
SECTION 3.01. Establishment of Collection
Account; Certain Allocations........................ 69
ARTICLE IV
ARTICLE IV IS RESERVED AND MAY BE
SPECIFIED IN ANY SUPPLEMENT WITH
RESPECT TO THE SERIES RELATING THERETO.
ARTICLE V
The Investor Certificates and
Exchangeable Company Interest
SECTION 5.01. The Investor Certificates............................. 77
SECTION 5.02. Authentication of Investor
Certificates........................................ 78
SECTION 5.03. Registration of Transfer and
Exchange of Investor
Certificates........................................ 79
SECTION 5.04. Mutilated, Destroyed, Lost or
Stolen Investor Certificates........................ 82
SECTION 5.05. Persons Deemed Owners................................. 83
SECTION 5.06. Appointment of Paying Agent........................... 84
SECTION 5.07. Access to List of Investor
Certificateholders' Names and
Addresses........................................... 85
SECTION 5.08. Authenticating Agent.................................. 86
SECTION 5.09. Tax Treatment......................................... 88
SECTION 5.10. Exchangeable Company Interest......................... 89
SECTION 5.11. Book-Entry Certificates............................... 93
SECTION 5.12. Notices to Clearing Agency............................ 94
SECTION 5.13. Definitive Certificates............................... 95
TOC Amended and Restated Pooling Agreement Contents, p. 3
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ARTICLE VI
Other Matters Relating to the Company
SECTION 6.01. Liability of the Company.............................. 96
SECTION 6.02. Limitation on Liability of the
Company............................................. 96
ARTICLE VII
Early Amortization Events
SECTION 7.01. Early Amortization Events............................. 96
SECTION 7.02. Additional Rights upon the
Occurrence of Certain Events........................ 99
ARTICLE VIII
The Trustee
SECTION 8.01. Duties of Trustee..................................... 100
SECTION 8.02. Rights of the Trustee................................. 103
SECTION 8.03. Trustee Not Liable for Recitals....................... 106
SECTION 8.04. Trustee May Own Investor
Certificates........................................ 107
SECTION 8.05. Trustee's Fees and Expenses........................... 107
SECTION 8.06. Eligibility Requirements for
Trustee............................................. 109
SECTION 8.07. Resignation or Removal of
Trustee............................................. 109
SECTION 8.08. Successor Trustee..................................... 110
SECTION 8.09. Merger or Consolidation of
Trustee............................................. 111
SECTION 8.10. Appointment of Co-Trustee or
Separate Trustee.................................... 112
SECTION 8.11. Tax Returns........................................... 114
TOC Amended and Restated Pooling Agreement Contents, p. 4
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SECTION 8.12. Trustee May Enforce Claims Without
Possession of Investor
Certificates........................................ 115
SECTION 8.13. Suits for Enforcement................................. 115
SECTION 8.14. Rights of Investor Certificate-
holders To Direct Trustee........................... 116
SECTION 8.15. Representations and Warranties of
Trustee............................................. 116
SECTION 8.16. Maintenance of Office or Agency....................... 117
SECTION 8.17. Limitation of Liability............................... 117
ARTICLE IX
Termination
SECTION 9.01. Termination of Trust.................................. 118
SECTION 9.02. Optional Purchase and Final
Termination Date of Investor
Certificates of Any Series.......................... 119
SECTION 9.03. Final Payment with Respect to Any
Series.............................................. 121
SECTION 9.04. Company's Termination Rights.......................... 123
ARTICLE X
Miscellaneous Provisions
SECTION 10.01. Amendment............................................. 123
SECTION 10.02. Protection of Right, Title and
Interest to Trust.................................... 126
SECTION 10.03. Limitation on Rights of Holders....................... 127
SECTION 10.04. Governing Law......................................... 128
SECTION 10.05. Notices............................................... 128
SECTION 10.06. Severability of Provisions............................ 130
SECTION 10.07. Assignment............................................ 130
SECTION 10.08. Investor Certificates Nonassessable
and Fully Paid...................................... 130
SECTION 10.09. Further Assurances.................................... 130
SECTION 10.10. No Waiver; Cumulative Remedies........................ 131
TOC Amended and Restated Pooling Agreement Contents, p. 5
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SECTION 10.11. Counterparts.......................................... 131
SECTION 10.12. Third-Party Beneficiaries............................. 131
SECTION 10.13. Actions by Investor
Certificateholders.................................. 131
SECTION 10.14. Merger and Integration................................ 132
SECTION 10.15. Headings.............................................. 132
SECTION 10.16. Construction of Agreement............................. 132
SECTION 10.17. No Setoff............................................. 132
SECTION 10.18. No Bankruptcy Petition................................ 133
SECTION 10.19. Limitation of Liability............................... 133
SECTION 10.20. Certain Information................................... 134
TOC Amended and Restated Pooling Agreement Contents, p. 6
EXHIBITS
Exhibits A-1 Forms of Lockbox Agreements
through A-15
Exhibit B Form of Annual Opinion of Counsel
Exhibit C Internal Operating Procedures
Memorandum
Exhibit D Depositary Agreement with BayBank
SCHEDULES
Schedule 1 Receivables
Schedule 2 Identification of the Trust Accounts
Schedule 3 Location of Chief Executive Office of
the Company
APPENDICES
Appendix A Description of Servicer Site Review
Procedures
Appendix B Description of Standby Liquidation
System
AMENDED AND RESTATED POOLING AGREEMENT dated as of
February 4, 1997, among LFI RECEIVABLES CORPORATION, a
Delaware corporation (the "Company"); LFI SERVICING
CORPORATION, a Delaware corporation (in its capacity as master
servicer, the "Master Servicer"); and THE CHASE MANHATTAN
BANK, a New York banking corporation, not in its individual
capacity, but solely as trustee (in such capacity, the
"Trustee").
W I T N E S S E T H :
WHEREAS, as of August 5, 1996, (i) the Company, the Sellers and the
Servicers entered into a Receivables Sale Agreement (as amended and restated on
February 4, 1997, and as amended, supplemented or otherwise modified from time
to time thereafter, the "Receivables Sale Agreement") and (ii) the Company, the
Master Servicer, the Servicers and the Trustee entered into a Servicing
Agreement (as amended and restated on February 4, 1997, and as amended,
supplemented or otherwise modified from time to time thereafter, the "Servicing
Agreement");
WHEREAS, the parties hereto entered into that certain Pooling
Agreement, dated as of August 5, 1996 (the "Original Pooling Agreement") in
order to create a master trust to which the Company would transfer all its
right, title and interest in, to and under the Receivables and other Trust
Assets then or thereafter owned by the Company and such master trust has issued,
and shall, from time to time at the direction of the Company, issue one or more
Series of Investor Certificates, representing interests in the Receivables and
such other Trust Assets as specified in the Supplement related to such Series;
Amended and Restated Pooling Agreement 2
WHEREAS, the parties hereto wish to amend and restate the Original
Pooling Agreement so as to amend various provisions of the Original Pooling
Agreement; and
WHEREAS, the Original Pooling Agreement shall be replaced in whole
by this Amended and Restated Pooling Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants herein contained, the parties hereto agree as follows:
ARTICLE I
Definitions
SECTION 1.01. Definitions. Whenever used in this Agreement, the
following words and phrases shall have the following meanings:
"Accounts" shall have the meaning specified in subsection
2.01(a)(vi) of this Agreement.
"Accrual Period" shall mean, for any Series, the period from and
including a Distribution Date, or, in the case of the initial Accrual Period for
such Series, the Issuance Date for such Series, to but excluding the succeeding
Distribution Date.
"Adjusted Invested Amount" shall mean, with respect to any
Outstanding Series, the definition assigned to such term in the related
Supplement.
"Adjustment Payments" shall mean the collective reference to
payments of Transfer Deposit Amounts and Cash Dilution Payments.
"Affiliate" shall mean, with respect to any specified Person, any
other Person which, directly or
Amended and Restated Pooling Agreement 3
indirectly, is in control of, is controlled by, or is under common control with,
such specified Person. For purposes of this definition "control" of a Person
means the possession, directly or indirectly, of the power to direct or cause
the direction of the management and policies of such Person, whether through the
ownership of voting securities or otherwise, and the terms "controlling" and
"controlled" have meanings correlative to the foregoing.
"Agent" shall mean, with respect to any Series, the Person, if any,
so designated in the related Supplement.
"Aggregate Adjusted Invested Amount" shall mean, with respect to any
date of determination, the sum of the Adjusted Invested Amounts with respect to
all Outstanding Series on such date of determination.
"Aggregate Allocated Receivables Amount" shall mean, with respect to
any date of determination, the sum of the Allocated Receivables Amounts with
respect to all Outstanding Series on such date of determination.
"Aggregate Daily Collections" shall mean, with respect to any
Business Day, the aggregate amount of all Collections deposited into the
Collection Account on such day.
"Aggregate Invested Amount" shall mean, at any date of
determination, the sum of the Invested Amounts with respect to all Outstanding
Series on such date of determination.
"Aggregate Overconcentration Amount" shall mean, with respect to any
date of determination, the sum of the Overconcentration Amounts of all Eligible
Obligors at the end of the preceding Business Day.
"Aggregate Receivables Amount" shall mean, with respect to any date
of determination, (i) the aggregate Principal Amount of all Eligible Receivables
in the Trust at
Amended and Restated Pooling Agreement 4
the end of the Business Day immediately preceding such date minus (ii) the
Aggregate Overconcentration Amount for such date.
"Aggregate Target Receivables Amount" shall mean, with respect to
any date of determination, the sum of the Target Receivables Amounts with
respect to all Outstanding Series on such date of determination.
"Agreement" shall mean this Amended and Restated Pooling Agreement
and all amendments hereof and supplements hereto, and including, unless
expressly stated otherwise, each Supplement.
"Allocable Charged-Off Amount" shall have, with respect to any
Series, the meaning specified in subsection 3.01(e) and in any Supplement for
such Series.
"Allocable Recoveries Amount" shall have, with respect to any
Series, the meaning specified in subsection 3.01(e) and in any Supplement for
such Series.
"Allocated Receivables Amount" shall have, with respect to any
Outstanding Series, the meaning specified in the related Supplement for such
Outstanding Series.
"Amortization Period" shall have, with respect to any Outstanding
Series, the definition assigned to such term in the related Supplement.
"Applicable Insolvency Laws" shall have the meaning specified in
subsection 7.01(a).
"Bankruptcy Code" shall mean the United States Federal Bankruptcy
Code, 11 U.S.C. subsection 101-1330, as amended.
"BayBank Depository Agreement" shall mean the depository agreement
attached as Exhibit D hereto.
Amended and Restated Pooling Agreement 5
"Board" shall mean the Board of Governors of the Federal Reserve
System of the United States of America.
"Book-Entry Certificates" shall mean certificates evidencing a
beneficial interest in the Investor Certificates, ownership and transfers of
which shall be made through book entries by a Clearing Agency as described in
Section 5.11; provided, however, that after the occurrence of a condition
whereupon book-entry registration and transfer are no longer permitted and
Definitive Certificates are issued to the Certificate Book-Entry Holders, such
Investor Certificates shall no longer be "Book-Entry Certificates".
"Business Day" shall mean any day other than (i) a Saturday or a
Sunday or (ii) another day on which commercial banking institutions or trust
companies in the State of New York or in the city where the Corporate Trust
Office is located, are authorized or obligated by law, executive order or
governmental decree to be closed; provided that, when used in connection with
the calculation of Certificate Rates which are determined by reference to LIBOR,
"Business Day" shall mean any Business Day banks are open for dealings in dollar
deposits in the London interbank market.
"Business Day Received" shall mean, except as otherwise set forth in
the applicable Supplement, (i) with respect to funds deposited in the Collection
Account (a) if funds are deposited in the Collection Account by 1:30 p.m., New
York City time, such day of deposit and (b) if funds are deposited in the
Collection Account after 1:30 p.m., New York City time, the Business Day
immediately following such day of deposit and (ii) with respect to funds
deposited in any Lockbox Account (a) if funds are deposited in such Lockbox
Account by the cut-off time established by the related Lockbox Processor for
same-day processing of deposits, such day of deposit and (b) if funds are
deposited in such Lockbox Account after such cut-off time, the Business Day
immediately following such day of deposit.
Amended and Restated Pooling Agreement 6
"Cash Dilution Payment" shall have the meaning specified in
subsection 4.05(a) of the Servicing Agreement.
"Certificate Book-Entry Holder" shall mean, with respect to a
Book-Entry Certificate, the Person who is listed on the books of the Clearing
Agency, or on the books of a Person maintaining an account with such Clearing
Agency, as the beneficial owner of such Book-Entry Certificate (directly or as
an indirect participant, in accordance with the rules of such Clearing Agency).
"Certificate Rate" shall mean with respect to any Series and Class
of Investor Certificates, the percentage interest rate (or formula on the basis
of which such interest rate shall be determined) stated in the applicable
Supplement.
"Certificate Register" shall mean the register maintained pursuant
to subsection 5.03(a), providing for the registration of the Investor
Certificates and transfers and exchanges thereof.
"Charged-Off Receivables" shall mean, with respect to any Settlement
Period, all Receivables which, in accordance with the Policies of the applicable
Seller, have or should have been written off during such Settlement Period as
uncollectible, including without limitation the Receivables of any Obligor which
becomes the subject of any voluntary or involuntary bankruptcy proceeding.
"Class" shall mean, with respect to any Series, any one of the
classes of Investor Certificates of that Series as specified in the related
Supplement.
"Clean-Up Call Repurchase Price" shall have the meaning set forth in
subsection 9.02(a).
"Clearing Agency" shall mean each organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934.
Amended and Restated Pooling Agreement 7
"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 such Clearing Agency.
"Collection Account" shall have the meaning specified in subsection
3.01(a).
"Collections" shall mean all collections and all amounts received in
respect of the Receivables transferred to the Trust, including Recoveries,
Adjustment Payments, indemnification payments made by the Master Servicer, any
Servicer or the Company and payments received in respect of Dilution
Adjustments, together with all collections received in respect of the Related
Property in the form of cash, checks, wire transfers or any other form of cash
payment, and all proceeds of Receivables and collections thereof (including,
without limitation, collections evidenced by an account, note, instrument,
letter of credit, security, contract, security agreement, chattel paper, general
intangible or other evidence of indebtedness or security, whatever is received
upon the sale, exchange, collection or other disposition of, or any indemnity,
warranty or guaranty payable in respect of, the foregoing and all "proceeds" as
defined in Section 9-306 of the UCC as in effect in the State of New York).
"Company" shall mean LFI Receivables Corporation, a Delaware
corporation.
"Company Collection Subaccount" shall have the meaning specified in
subsection 3.01(a).
"Company Exchange" shall have the meaning specified in subsection
5.10(a).
"Company Material Adverse Effect" shall mean (i) any material
impairment of the Company's ability to perform any of its material obligations
or to comply with or
Amended and Restated Pooling Agreement 8
conduct its business in accordance with any of its material representations,
warranties, covenants or agreements under any Transaction Document or (ii) any
material impairment of the interests, rights or remedies of the Trustee or the
Investor Certificateholders against or with respect to the Company under any
Transaction Document.
"Company Subordinated Obligation" shall mean any payment obligation
or other liability designated as such in any Pooling and Servicing Agreement,
each of which payment obligations and other liabilities shall (i) be
subordinated and subject to the prior payment in full of all Company
Unsubordinated Obligations then due, (ii) be made solely from funds available to
the Company that are not required to be applied to Company Unsubordinated
Obligations then due and (iii) not constitute a general recourse claim against
the Company, but only a claim against the Company to the extent of funds
available to the Company after satisfying all Company Unsubordinated Obligations
then due.
"Company Unsubordinated Obligations" shall mean all payment
obligations and other liabilities of the Company under any Pooling and Servicing
Agreement that are not designated as Company Subordinated Obligations.
"Contractual Obligation" shall mean, as to any Person, any provision
of any security issued by such Person or of any agreement, instrument or other
undertaking to which such Person is a party or by which it or any of its
property is bound.
"Corporate Trust Office" shall mean the principal office of the
Trustee at which at any particular time its corporate trust business shall be
administered, which office at the date of the execution of this Agreement is
located at The Chase Manhattan Bank, ▇▇▇ ▇. ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (Attention of Advanced Structured Products Group).
Amended and Restated Pooling Agreement 9
"Credit Agreement" shall mean the Credit Agreement dated as of
August 5, 1996, among: Lifestyle Furnishings International Ltd.; each subsidiary
of Lifestyle Furnishings International Ltd. listed on Schedule 1 thereto;
Furnishings International Inc.; the lenders identified therein; The Chase
Manhattan Bank, as a lender and as administrative agent and collateral agent for
the lenders; and Chase Manhattan Bank Delaware, as a letter of credit issuer
thereunder (including any amendments or modifications thereto or refinancings
thereof).
"Credit Enhancer" shall mean, with respect to any Series, that
Person, if any, designated as such in the applicable Supplement.
"Cut-Off Date", shall mean the close of business on January 29,
1997.
"DCR" shall mean Duff & ▇▇▇▇▇▇ Credit Rating Co., a nationally
recognized statistical rating organization, and any successor thereto.
"Daily Report" shall have the meaning specified in subsection 4.01
of the Servicing Agreement.
"Defaulted Receivable" shall mean any Receivable (a) which is unpaid
in whole or in part for more than 60 days after its original due date or (b)
which is a Charged-Off Receivable.
"Definitive Certificates" shall have the meaning specified in
Section 5.11.
"Depository" shall mean, with respect to any Series, the Clearing
Agency designated as the "Depository" in the related Supplement.
"Depository Agreement" shall mean, with respect to any Series, an
agreement among the Company, the Trustee and a
Amended and Restated Pooling Agreement 10
Clearing Agency, in a form reasonably satisfactory to the Trustee and the
Company.
"Dilution Adjustment" shall mean any payments, rebates, discounts,
refunds or adjustments (including without limitation, as a result of the
application of any special or other discounts or any reconciliations) of any
Receivable, the amount owing for any returns (including, without limitation, as
a result of the return of any defective goods) or cancelations and the amount of
any other reduction of any payment under any Receivable, in each case granted or
made by the Seller to the related Obligor; provided, however, a "Dilution
Adjustment" does not include any Charged-Off Receivable.
"Distribution Date" shall mean, except as otherwise set forth in the
applicable Supplement, the 15th day of the month, or if such 15th day is not a
Business Day, the next succeeding Business Day.
"Dollars", "U.S. Dollars" and "$" shall mean dollars in lawful
currency of the United States of America.
"Early Amortization Event" shall have, with respect to any Series,
the meaning specified in Section 7.01 of this Agreement (without taking into
account any Supplements) and in any Supplement for such Series.
"Early Amortization Period" shall have, with respect to any Series,
the definition assigned to such term in Section 7.01 of this Agreement and in
any Supplement for such Series.
"Eligible Institution" shall mean a depositary institution or trust
company (which may include the Trustee and its Affiliates) organized under the
laws of the United States of America or any one of the states thereof or the
District of Columbia; provided, however, that at all times (i) such depositary
institution or trust company is a member of the Federal Deposit Insurance
Corporation, (ii) the
Amended and Restated Pooling Agreement 11
unsecured and uncollateralized debt obligations of such depositary institution
or trust company are rated in one of the two highest long-term or short-term
rating categories by each Rating Agency and (iii) such depositary institution or
trust company has a combined capital and surplus of at least $100,000,000.
"Eligible Investments" shall mean any book-entry securities,
negotiable instruments or securities represented by instruments in bearer or
registered form which evidence:
(a) direct obligations of, and obligations fully guaranteed as to
timely payment by, the United States of America;
(b) Federal funds, demand deposits, time deposits or certificates of
deposit of any depositary institution or trust company incorporated under
the laws of the United States of America or any state thereof (or any
domestic branch of a foreign bank) and subject to supervision and
examination by federal or state banking or depositary institution
authorities; provided, however, that at the time of the investment or
contractual commitment to invest therein the commercial paper or other
short-term unsecured debt obligations (other than such obligations the
rating of which is based on the credit of a Person other than such
depository institution or trust company) thereof shall have a credit
rating from each of the Rating Agencies rating such investment in the
highest investment category granted thereby;
(c) commercial paper rated, at the time of the investment or
contractual commitment to invest therein, in the highest rating category
by each Rating Agency rating such commercial paper;
(d) investments in money market funds (including funds for which the
Trustee or any of its Affiliates is investment manager or adviser) rated
in the highest
Amended and Restated Pooling Agreement 12
rating category by each Rating Agency rating such money market fund
(provided that, if such Rating Agency is S&P, such rating shall be
AAAm-G);
(e) bankers acceptances issued by any depository institution or
trust company referred to in clause (b) above;
(f) repurchase obligations with respect to any security that is a
direct obligation of, or fully guaranteed by, the United States of America
or any agency or instrumentality thereof the obligations of which are
backed by the full faith and credit of the United States of America, in
either case entered into with a depository institution or trust company
(acting as principal) described in clause (b) above; or
(g) any other investment upon satisfaction of the Rating Agency
Condition with respect thereto.
"Eligible Letter of Credit" shall mean any irrevocable documentary
credit (a direct-pay letter of credit) or any irrevocable standby letter of
credit supporting a Receivable, or two or more Receivables sold to the Company
by the same Seller, that is (a) either (i) issued in favor of such Seller or the
Company and the right to draw under which is, or the proceeds of which are,
legally transferable and assignable to the Trustee or (ii) issued in favor of
the Trustee, (b) governed by the UCC of a state of the United States of America,
governed by the UCP 500 or governed as to certain terms by the UCP 500 and as to
any remaining terms by the UCC of a state of the United States of America, (c)
issued by a commercial bank that (i) has a combined capital and surplus of at
least $50,000,000 and (ii) has (or the holding company parent of which has)
either a long-term or a short-term senior unsecured debt rating in the highest
rating category by each Rating Agency and (d) permits the beneficiary to draw,
upon notice to the issuing bank, an amount equal to the entire Principal Amount
of any Receivable supported thereby in U.S.
Amended and Restated Pooling Agreement 13
Dollars payable by the issuing bank to the Trustee, as assignee or as original
beneficiary, in the case of a documentary credit (a direct-pay letter of
credit), on or before the due date of such Receivable and, in the case of a
standby letter of credit, on or before the fifth day following the due date of
such Receivable.
"Eligible Obligor" shall mean, as of any date of determination, each
Obligor in respect of a Receivable that satisfies the following eligibility
criteria:
(a) it is "located" (within the meaning of Section 9-103(3)(d) of
the UCC as in effect in the State of New York) in the United States;
provided, however, that Obligors that are not so located within the United
States shall be deemed Eligible Obligors if (i) the Receivables of such
Obligor would satisfy the definition of "Eligible Receivable" in all
respects if they were owing by an Eligible Obligor, (ii) each Receivable
of such Obligor is supported by an Eligible Letter of Credit (and all
necessary actions are taken for the perfection of the transfer of such
Eligible Letter of Credit to the Trust, including the delivery requirement
set forth in subsection 2.01(b)) and (iii) as of any date of determination
after giving effect to any proposed transfer of Receivables to the Trust
owing by Obligors that would be deemed Eligible Obligors pursuant to this
proviso, the aggregate Principal Amount of all Receivables included in the
Trust Assets that have been or would be transferred to the Trust on the
basis of this proviso does not exceed 5% of the aggregate Principal Amount
of all Receivables then included in the Trust Assets;
(b) if it is a Federal Government Obligor or if it is a State/Local
Government Obligor, then such Obligor shall be subject to the first
proviso contained in the definition of "Overconcentration Amount";
Amended and Restated Pooling Agreement 14
(c) it is not a Seller or an Affiliate of a Seller; and
(d) it is either (i) not the subject of any voluntary or involuntary
bankruptcy proceeding or (ii) a Qualifying DIP Obligor;
provided, however, that, if 35% or more of the Principal Amount of
Receivables of an Obligor (measured by the Principal Amount of Receivables
in the Trust) is reported as being aged 91 days or more after the
respective due dates of such Receivables as at the end of the Settlement
Period immediately preceding the most recent Settlement Report Date
(commencing with the September 10, 1996 Settlement Report Date), such
Obligor shall not be deemed an Eligible Obligor until such time as the
Master Servicer or the responsible Servicer furnishes the Rating Agencies
with a report (which may be part of a Daily Report or a Monthly Settlement
Statement) indicating that less than 35% of the Principal Amount of
Receivables of such Obligor then in the Trust are aged 91 days or more
after the respective due dates of such Receivables.
"Eligible Receivable" shall mean, as of any date of determination,
each Receivable owing by an Eligible Obligor in existence as of such date that
satisfies the following eligibility criteria:
(a) it constitutes either (i) an account within the meaning of
Section 9-106 of the UCC of the state the law of which governs the
perfection of the interest granted in it, (ii) an instrument within the
meaning of Section 9-105 of such UCC, which shall be subject to compliance
with the delivery requirement set forth in subsection 2.01(b), (iii)
chattel paper within the meaning of Section 9-105 of such UCC, which shall
be subject to compliance with the delivery requirement set forth in
subsection 2.01(b), or (iv) a general intangible (including to the extent
that such
Amended and Restated Pooling Agreement 15
Receivable includes interest, finance charges, returned check or late
charges on sales or similar charges) within the meaning of Section 9-106
of such UCC;
(b) it is not a Defaulted Receivable;
(c) the goods related to it shall have been shipped or the services
related to it shall have been performed and such Receivable shall have
been billed to the related Obligor;
(d) it is denominated and payable only in U.S. Dollars in the United
States;
(e) it arose in the ordinary course of business from the sale of
goods, products or services of a Seller and in accordance with the
Policies of such Seller and, at such date of determination, the
Receivables Sale Agreement has not been terminated;
(f) it does not contravene any applicable law, rule or regulation
and the related Seller is not in violation of any law, rule or regulation
in connection with it, in each case which in any way renders such
Receivable unenforceable or would otherwise impair in any material respect
the collectibility of such Receivable;
(g) it is not a Receivable with an original repayment term in excess
of 180 days from the invoice date;
(h) if the Company and the Trust are not excluded from the
definition of "investment company" pursuant to Rule 3a-7 under the 1940
Act, it is an account receivable representing all or part of the sales
price of merchandise, insurance or services within the meaning of Section
3(c)(5) of the 1940 Act;
Amended and Restated Pooling Agreement 16
(i) it is not a Receivable purchased by a Seller from any Person;
(j) it is not a Receivable for which a Seller has established an
offsetting specific reserve;
(k) it is not a Receivable in respect of which a Seller has (i)
entered into an arrangement with the Obligor pursuant to which payment of
any portion of the purchase price has been extended or deferred, whether
by means of a promissory note or by any other means, to a date more than
60 days from the due date or (ii) altered the basis of the aging from the
initial due date for payment such that the final due date extends to a
date more than 60 days from the invoice date or (iii) otherwise made any
modification except in the ordinary course of business and consistent with
the Policies of such Seller;
(l) all required consents, approvals or authorizations necessary for
the creation and enforceability of such Receivable and the effective
assignment and sale thereof by a Seller to the Company and by the Company
to the Trust shall have been obtained with respect to the Receivable;
(m) a Seller is not in default in any material respect under the
terms of the contract, if any, from which such Receivable arose;
(n) all right, title and interest in it has been validly sold by a
Seller to the Company pursuant to the Receivables Sales Agreement;
(o) the Company or the Trust will have legal and beneficial
ownership therein free and clear of all Liens other than such Liens
described in clause (i) of the definition of Permitted Liens and such
Receivable has been the subject of either a valid transfer from the
Company to the Trust or, alternatively, the grant
Amended and Restated Pooling Agreement 17
of a first priority perfected security interest therein to the Trust free
and clear of all Liens other than such Liens described in clause (i) of
the definition of Permitted Liens;
(p) it represents an enforceable obligation of the related Obligor
to pay the full Principal Amount thereof and it is not subject to any
dispute in whole or in part or to any offset, counterclaim or defense;
(q) it is at all times the legal, valid and binding obligation of
the Obligor thereon, enforceable against such Obligor in accordance with
its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws
affecting the enforcement of creditors' rights generally and by general
equitable principles (whether enforcement is sought by proceedings in
equity or law);
(r) as of the related Receivables Purchase Date, neither the Company
nor a Seller has (i) taken any action in contravention of the terms of any
Transaction Document or (ii) failed to take any action required to be
taken by the terms of any Transaction Document that, in either case, is
likely to impair the rights therein of the Trustee or Investor
Certificateholders with respect to such Receivable;
(s) each of the representations and warranties with respect to such
Receivable made in the Receivables Sale Agreement by the related Seller is
true and correct in all material respects; and
(t) at the time such Receivable was sold by the related Seller to
the Company under the Receivables Sale Agreement, no event described in
subsection 7.01(d) of the Receivables Sale Agreement (without giving
effect to any requirement as to the
Amended and Restated Pooling Agreement 18
passage of time) had occurred with respect to such Seller;
provided that a Receivable which would otherwise not qualify as an Eligible
Receivable because of a failure to comply with clause (j) or (p) above shall
constitute an Eligible Receivable to the extent of the Principal Amount of such
Receivable minus the amount of such Receivable which fails to comply with such
clause (j) or (p); provided further that with respect to Receivables owing by
Government Obligors, such Receivables shall constitute Eligible Receivables
notwithstanding the failure of such Receivables to satisfy clause (l) above
except to the extent such failure adversely affects the actual collection of
such Receivables by the Company or the Trust.
"Eligible Successor Servicer" shall mean a Person which, at the time
of its appointment as Servicer (i) is legally qualified and has the corporate
power and authority to service the Receivables transferred to the Trust, (ii)
has demonstrated the ability to service a portfolio of similar receivables in
accordance with high standards of skill and care in the sole determination of
the Master Servicer and (iii) has a combined capital and surplus of at least
$5,000,000.
"Enhancement" shall mean, with respect to any Series (i) the funds
on deposit in or credited to any bank account (or subaccount thereof) of the
Trust, (ii) any surety arrangement, any letter of credit, guaranteed rate
agreement, maturity guaranty facility, tax protection agreement, interest rate
swap, currency swap or other contract, agreement or arrangement, in each case
for the benefit of any Investor Certificateholders of such Series, as designated
in the applicable Supplement and (iii) the subordination of one Class of
Investor Certificates in a Series to another Class in such Series or the
subordination of any Interest to the Investor Certificates of such Series.
Amended and Restated Pooling Agreement 19
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"Exchange Date" shall have the meaning, with respect to any Series
issued pursuant to an Exchange, specified in subsection 5.10(a).
"Exchange Notice" shall have the meaning, with respect to any Series
issued pursuant to an Exchange, specified in subsection 5.10(a).
"Exchange Register" shall have the meaning specified in subsection
5.10(a).
"Exchangeable Company Interest" shall have the meaning specified in
subsection 3.01(b) and shall be exchangeable as provided in Section 5.10.
"Excluded Note" shall mean any receivable (i) which originally
represented obligations owing by the account debtor thereon to more than one
Seller, (ii) which is or will be evidenced by an instrument payable to the
Seller who will administer such Receivable, (iii) which will be treated as an
account receivable on the books and records of such Sellers until an instrument
is executed in favor of the Seller who will administer such Receivable and
thereafter will be treated as a note receivable on the books of such
administering Seller and (iv) for which payments are not at any time to be made
to a Lockbox or Lockbox Account.
"Excluded Receivable" shall mean, as of any date of determination,
any indebtedness and payment obligations of any Person to any Seller arising
from a sale of merchandise or services by such Seller that has the attributes
set forth in any of the following paragraphs:
(a) it is owing by an Obligor that is an Affiliate of any Seller;
Amended and Restated Pooling Agreement 20
(b) it is owing by an Obligor that is not "located" (within the
meaning of Section 9-103(3)(d) of the UCC as in effect in the State of New
York) in the United States and it is not supported by an Eligible Letter
of Credit;
(c) it is an Excluded Note;
(d) it is a Receivable originated by the Beacon Hill division of
▇▇▇▇▇▇ ▇▇▇▇▇ Fabrics, Inc.; or
(e) it is owing by ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ Holding Corporation or any of its
subsidiaries to The Berkline Corporation.
"Federal Government Obligor" shall mean the United States Federal
government or any subdivision thereof or any agency, department or
instrumentality thereof.
"Force Majeure Delay" shall mean, with respect to any Servicer, any
cause or event which is beyond the control and not due to the negligence of such
Servicer which delays, prevents or prohibits such Servicer's delivery of Daily
Reports and/or Monthly Settlement Statements, including, without limitation,
acts of God or the elements and fire, but shall not include strikes; provided
that no such cause or event shall be deemed to be a Force Majeure Delay unless
such Servicer shall have given the Company and the Trustee written notice
thereof as soon as reasonably possible after the beginning of such delay.
"Fractional Undivided Interest" shall mean a fractional undivided
interest, which, with respect to any Investor Certificate, can be expressed as a
percentage of the interest in the Trust Assets represented by the Series or
Class in which it was issued by taking the percentage equivalent of a fraction
the numerator of which is the principal amount of such Investor Certificate and
the denominator of which is the aggregate principal amount of all Investor
Certificates of such Series or Class.
Amended and Restated Pooling Agreement 21
"GAAP" shall mean generally accepted accounting principles in the
United States of America as in effect from time to time.
"General Opinion" shall mean, with respect to any action, an Opinion
of Counsel to the effect that (i) such action has been duly authorized by all
necessary corporate action on the part of the Servicers or the Company, as the
case may be and (ii) any agreement executed in connection with such action
constitutes a legal, valid and binding obligation of the Servicers or the
Company, as the case may be, enforceable in accordance with the terms thereof,
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 and except as such enforceability
may be limited by general principles of equity (whether considered in a
proceeding at law or in equity).
"Government Obligor" shall mean any Federal Government Obligor or
any State/Local Government Obligor.
"Governmental Authority" shall mean any nation or government, any
state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Holders" shall mean the collective reference to the Investor
Certificateholders, the holders of Subordinated Company Interests and the
holders of the Exchangeable Company Interest.
"Indebtedness" shall mean, with respect to any Person at any date,
(a) all indebtedness of such Person for borrowed money, (b) any obligation owed
for the deferred purchase price of property or services which purchase price is
evidenced by a note or similar written instrument, (c) notes payable and drafts
accepted representing extensions of credit whether or not representing
obligations
Amended and Restated Pooling Agreement 22
for borrowed money, (d) that portion of obligations of such Person under capital
leases which is properly classified as a liability on a balance sheet in
conformity with GAAP and (e) all liabilities of the type described in the
foregoing clauses (a) through (d) secured by any Lien on any property owned by
such Person even though such Person has not assumed or otherwise become liable
for the payment thereof.
"Indemnified Person" shall have the meaning specified in Section
10.19.
"Independent Public Accountants" shall mean, with respect to any
Person, any independent certified public accountants of nationally recognized
standing which constitute one of the accounting firms commonly referred to as
the "big six" accounting firms (or any successor thereto); provided that such
firm is independent with respect to such Person within the meaning of Rule
2-01(b) of Regulation S-X under the Securities Act.
"Ineligibility Determination Date" shall have the meaning specified
in subsection 2.05(a).
"Ineligible Receivable" shall have the meaning specified in
subsection 2.05(a).
"Initial Closing Date" shall mean August 5, 1996.
"Initial Invested Amount" shall have, with respect to any Series,
the meaning specified in the related Supplement for such Series.
"Insolvency Event" shall mean the occurrence of any one or more of
the Early Amortization Events specified in paragraph (a) of Section 7.01.
"Interest" shall mean any interest in the Trust Assets issued
pursuant to the Agreement or any Supplement.
Amended and Restated Pooling Agreement 23
"Internal Operating Procedures Memorandum" shall mean the internal
operating procedures memorandum prepared by the Trustee as set forth in Exhibit
C hereto.
"Internal Revenue Code" shall mean the Internal Revenue Code of
1986, as amended from time to time, and the rules and regulations promulgated
thereunder from time to time.
"Invested Amount" shall have, with respect to any Series, the
meaning specified in the related Supplement for such Series.
"Invested Percentage" shall have, with respect to any Series, the
meaning specified in the related Supplement for such Series.
"Investment" shall mean the making by the Company or any Seller of
any advance, loan, extension of credit or capital contribution to, the purchase
of any stock, bonds, notes, debentures or other securities of or any assets
constituting a business unit of, or the making by the Company or any Seller of
any other investment in, any Person.
"Investment Earnings" shall have the meaning specified in subsection
3.01(c).
"Investor Certificateholder" shall mean the holder of record of, or
the bearer of, an Investor Certificate.
"Investor Certificateholders' Interest" shall have the meaning
specified in subsection 3.01(b).
"Investor Certificates" shall mean the certificates executed by the
Company and authenticated by or on behalf of the Trustee, substantially in the
form attached to the applicable Supplement, but shall not include the
Exchangeable Company Interest, any Subordinated Company Interest or any other
Interest held by the Company.
Amended and Restated Pooling Agreement 24
"Issuance Date" shall mean, with respect to any Series, the date of
issuance of such Series, or the date of any increase to the Invested Amount of
such Series, as specified in the related Supplement.
"LHL Guarantee" shall mean the Guarantee dated as of August 5, 1996,
executed by Lifestyle Holdings Ltd. guaranteeing the performance of the
obligations of the Master Servicer under the Pooling and Servicing Agreements.
"LHL Demand Note" shall mean the demand note dated August 5, 1996,
issued by Lifestyle Holdings Ltd. to the Company in the amount of $5 million
"Lien" shall mean, with respect to any asset, (a) any mortgage, deed
of trust, lien, pledge, encumbrance, charge or security interest in or on such
asset, (b) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement relating to such asset and
(c) in the case of securities, any purchase option, call or other similar right
of a third party with respect to such securities; provided, however, that if a
lien is imposed under Section 412(n) of the Internal Revenue Code or Section
302(f) of ERISA for a failure to make a required installment or other payment to
a plan to which Section 412(n) of the Internal Revenue Code or Section 302(f) of
ERISA applies, then such lien shall not be treated as a "Lien" from and after
the time (a)(i) any Person who is obligated to make such payment pays to such
plan the amount of such lien determined under Section 412(n)(3) of the Internal
Revenue Code or Section 302(f)(3) of ERISA, as the case may be, and provides to
the Trustee, the Rating Agencies and any Agent a written statement of the amount
of such lien together with written evidence of payment of such amount, or (ii)
such lien expires pursuant to Section 412(n)(4)(B) of the Internal Revenue Code
or Section 302(f)(4)(B) of ERISA and (b) the Rating Agency Condition shall have
been satisfied.
Amended and Restated Pooling Agreement 25
"Lien Creation" shall mean the creation, incurrence, assumption or
suffering to exist by the Company or any Seller of any Lien upon the
Receivables, Related Property or the proceeds thereof.
"Lockbox" shall mean the post office boxes and accounts listed on
Schedule 2 to the Receivables Sale Agreement to which the Obligors are
instructed to remit payments on the Receivables and/or such other post office
boxes as may be established pursuant to Section 2.03 of the Servicing Agreement.
"Lockbox Account" shall mean the intervening account or accounts
used by a Lockbox Processor for deposit of funds received in a Lockbox prior to
their transfer to the Collection Account; provided, however, that until a
lockbox account is put into use for Collections received in respect of the
Receivables sold by ▇▇▇▇▇▇ ▇▇▇▇▇ Fabrics, Inc., the term "Lockbox Account" shall
include the account specified in the BayBank Depository Agreement used in lieu
of an actual lockbox account until such time as an actual lockbox account can be
put into use for such Collections.
"Lockbox Agreement" shall mean a lockbox agreement substantially in
the form set forth as Exhibit A-1, with such differences from such form as are
permitted upon satisfying the Rating Agency Condition and obtaining the consent
of each Agent as to such differences, or any of the lockbox agreements attached
as Exhibits A-2 through A-15.
"Lockbox Processor" shall mean the depositary institution or
processing company (which may be the Trustee) that processes payments on the
Receivables sent by the Obligors thereon forwarded to a Lockbox; provided,
however, in the case of the BayBank Depository Agreement, the term "Lockbox
Processor" shall include BayBank.
"Margin Stock" shall have the meaning given to such term in
Regulation U of the Board.
Amended and Restated Pooling Agreement 26
"Master Servicer" shall mean LFI Servicing Corporation, a Delaware
corporation, and any Successor Master Servicer under the Transaction Documents.
"Material Adverse Effect" shall mean a material impairment of the
collectibility of the Receivables or a material impairment of the interests,
rights or remedies of the Trustee or the Investor Certificateholders of any
Outstanding Series under or with respect to the Transaction Documents. Without
limiting the generality of the preceding sentence, any effect, result or
circumstance that adversely affects the collectibility of Receivables accounting
for 5% or more of the aggregate Principal Amount of all Receivables in the Trust
shall be deemed to be a Material Adverse Effect.
"Monthly Servicing Fee" shall have the meaning specified in
subsection 2.05(a) of the Servicing Agreement.
"Monthly Settlement Statement" shall have the meaning specified in
Section 4.02 of the Servicing Agreement.
"1940 Act" shall mean the Investment Company Act of 1940, as
amended.
"Obligor" shall mean, with respect to any Receivable, the party
obligated to make payments with respect to such Receivable, including any
guarantor thereof.
"Officer's Certificate" shall mean, with respect to any Person,
unless otherwise specified in this Agreement, a certificate signed by the
Chairman of the Board, any Vice Chairman of the Board, the Chief Executive
Officer, the President, the Chief Financial Officer, any Vice President (however
denominated) or the Treasurer of such Person (or an officer holding an office
with equivalent or more senior responsibilities).
Amended and Restated Pooling Agreement 27
"Opinion of Counsel" shall mean a written opinion or opinions of one
or more counsel (who may be internal counsel) to the Company, the Master
Servicer or any Servicer, designated by the Company, the Master Servicer or such
Servicer, as the case may be, that is reasonably acceptable to the Trustee.
"Optional Repurchase Percentage" shall have, with respect to any
Series, the meaning specified in the related Supplement for such Series.
"Optional Termination Notice" shall have, with respect to any
Series, the meaning specified in the related Supplement for such Series.
"Outstanding Series" shall mean, at any time, a Series issued
pursuant to an effective Supplement for which the Series Termination Date for
such Series has not occurred.
"Overconcentration Amount" shall mean, at any date with respect to
an Eligible Obligor, the Principal Amount of otherwise Eligible Receivables due
from such Obligor which, expressed as a percentage of the Principal Amount of
all Eligible Receivables in the Trust at such date, exceeds the percentage set
forth below for the applicable ratings category of that Obligor (or such larger
percentage upon satisfaction of the Rating Agency Condition);
Amended and Restated Pooling Agreement 28
Minimum Rating
--------------
S&P DCR Percentage
--- --- ----------
A-1+ or AA- D-1 or AA- 15.0%
A-1 or A+ D-1 or A+ 7.5%
A-2 or BBB+ D-2 or BBB+ 5.0%
A-3 or BBB- D-3 or BBB- 3.5%
Less than A-3 or Less than D-3 or
BBB-/Not rated BBB-/Not rated 3.0%
; provided, however, (i) that all Eligible Obligors that are Affiliates of each
other shall be deemed to be a single Eligible Obligor to the extent the Master
Servicer or any Servicer has actual knowledge of the affiliation and in that
case, the applicable debt rating for such group of Obligors shall be the debt
rating of the ultimate parent of the group, (ii) with respect to all Eligible
Obligors that are Government Obligors, such Obligors shall, notwithstanding the
foregoing, be deemed to be a single Eligible Obligor for which the applicable
percentage set forth under the column headed "Percentage" above shall be equal
to the Government Obligor Factor and (iii) with respect to the Obligor ▇▇▇▇▇▇-
▇▇▇▇▇▇ Company, the applicable percentage set forth under the column headed
"Percentage" above shall be 4.5% when its debt rating is "BBB-"; provided
further that the debt ratings set forth under the column headed "DCR" above and
references in the immediately succeeding paragraph to DCR shall apply only if
DCR is a Rating Agency under any Supplement for an Outstanding Series.
If the ratings given by S&P and DCR to the debt of any Obligor (or
the ultimate parent of the affiliated group of which such Obligor is a member,
as the case may be) would result in different applicable percentages under the
table above, the applicable percentage shall be the percentage associated with
the lower rating, as between S&P's rating and DCR's rating, of such Obligor's
(or such ultimate parent's, as the case may be) short-term senior debt;
Amended and Restated Pooling Agreement 29
provided that: (i) if such short-term debt is rated only by S&P, the applicable
percentage will be the percentage associated with the rating issued by S&P and
(ii) if S&P issues no short-term rating with respect to such Obligor's (or such
ultimate parent, as the case may be), then the percentage applicable to such
Obligor (or such ultimate parent, as the case may be) shall be the percentage
associated with the categories "Less than A-3 or BBB-/Not rated" and "Less than
D-3 or BBB-/Not rated." The ratings specified in the table are minimums for each
percentage category, so that a rating not shown in the table falls in the
category associated with the highest rating shown in the table that is lower
than that rating.
"Paying Agent" shall mean any paying agent and co-paying agent
appointed pursuant to Section 5.06 and, unless otherwise specified in the
related Supplement of any Series and with respect to such Series, shall
initially be The Chase Manhattan Bank.
"Permitted Liens" shall mean, at any time, for any Person:
(i) Liens created pursuant to this Agreement or the Receivables Sale
Agreement;
(ii) Liens for taxes, assessments or other governmental charges or
levies not yet due and with respect to which reserves in conformity with
GAAP have been provided on the books of such Person; and
(iii) Liens on a Receivable arising as a result of offsetting specific
reserves and rights of set-off, counterclaim or other defenses with
respect to such Receivable.
"Person" shall mean any individual, partnership, corporation,
business trust, joint stock company, trust, unincorporated association, joint
venture, Governmental Authority or other entity of whatever nature.
Amended and Restated Pooling Agreement 30
"Policies" shall mean, with respect to each Seller, the credit and
collection policies of such Seller, copies of which have been previously
delivered to the Trustee, as the same may be amended, supplemented or otherwise
modified from time to time in accordance with the Transaction Documents.
"Pooling and Servicing Agreements" shall have the meaning specified
in subsection 10.01(a).
"Potential Early Amortization Event" shall mean an event which, with
the giving of notice and/or the lapse of time, would constitute an Early
Amortization Event hereunder or under any Supplement.
"Potential Servicer Default" shall mean an event which, with the
giving of notice and/or the lapse of time, would constitute a Servicer Default
hereunder or under any Supplement.
"Prepayment Request" shall have, with respect to any Series, the
meaning specified in the related Supplement.
"Principal Amount" shall mean, with respect to any Receivable, the
amount due thereunder.
"Principal Terms" shall have the meaning, with respect to any Series
issued pursuant to an Exchange, specified in subsection 5.10(c).
"Program Costs" shall have, with respect to any Series, the meaning
specified in the related Supplement for such Series.
"Qualifying DIP Obligor" shall mean, as of any date of
determination, each Receivable owing by an Obligor (i) that is a "debtor in
possession", for which no trustee or examiner has been appointed and no
application is pending for the appointment of a trustee or examiner, in a case
under Chapter 11 of the Bankruptcy Code in which no motion
Amended and Restated Pooling Agreement 31
has been made for an order liquidating all or any substantial portion of such
debtor's assets and no motion has been made for the conversion of such case to a
case under Chapter 7 of the Bankruptcy Code, (ii) in the case of any proposed
Qualifying DIP Obligor whose Receivables would, if included in the Trust Assets,
account for 1% or more of the aggregate Principal Amount of all Receivables
included in the Trust, each Agent has been given notice at least five Business
Days prior to any transfer of Receivables owing by such Obligor to the Trust of
the proposed inclusion of such Obligor as an Eligible Obligor on the basis of
being a Qualifying DIP Obligor, (iii) as to which no Agent has, in the exercise
of its reasonable discretion, given notice to the Company and the Master
Servicer that such Obligor shall not be included as an Eligible Obligor and (iv)
for which the Obligor has obtained the approval of a bankruptcy court to make
payment thereon.
"Rating Agency" shall mean, with respect to each Outstanding Series,
any rating agency or agencies designated as such in the related Supplement;
provided that (i) in the event that no Outstanding Series has been rated, then
for purposes of the definitions of "Eligible Institution" and "Eligible
Investments", "Rating Agency" shall mean S&P; (ii) except as provided in (i), in
the event no Outstanding Series has been rated, any reference to "Rating Agency"
or the "Rating Agencies" shall be deemed to have been deleted herefrom, except
that references to the term "Rating Agency Condition" shall not be deemed
deleted, but shall be modified as set forth under the definition of such term.
"Rating Agency Condition" shall mean, with respect to any action,
that each Rating Agency shall have notified the Company, the Master Servicer,
any Agent and the Trustee in writing that such action will not result in a
reduction or withdrawal of the rating of any Outstanding Series or any Class of
any such Outstanding Series with respect to which it is a Rating Agency;
provided that in the event that no Outstanding Series has been rated, any
reference to a "Rating Agency Condition" shall be deemed to be a reference
Amended and Restated Pooling Agreement 32
to the prior written consent of the Agent with respect to such action.
"Receivable" shall mean the indebtedness and payment obligations of
any Person to any Seller (including, without limitation, obligations evidenced
by an account, note, instrument, contract, security agreement, chattel paper,
general intangible or other evidence of indebtedness or security) arising from a
sale of merchandise or services by such Seller, including, without limitation,
any right to payment for goods sold or for services rendered, and including the
right to payment of any interest, sales taxes, finance charges, returned check
or late charges and other obligations of such Person with respect thereto, but
not including any Excluded Receivable.
"Receivables Purchase Date" shall mean, with respect to any
Receivable, the Business Day on which the Company purchases such Receivable from
a Seller and transfers such Receivable to the Trust.
"Receivables Sale Agreement" shall mean the Amended and Restated
Receivables Sale Agreement, dated as of the date hereof, among the Sellers, the
Servicers and the Company, as amended, supplemented or otherwise modified from
time to time in accordance with the Transaction Documents.
"Record Date", shall mean, with respect to any Series, the date
specified as such in the applicable Supplement.
"Recoveries" shall mean all amounts collected (net of out-of-pocket
costs of collection) in respect of Charged-Off Receivables.
"Regulation G" shall mean Regulation G of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
Amended and Restated Pooling Agreement 33
"Regulation U" shall mean Regulation U of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"Regulation X" shall mean Regulation X of the Board as from time to
time in effect and all official rulings and interpretations thereunder or
thereof.
"Related Property" shall mean, with respect to each Receivable:
(a) all of a Seller's interest in the goods (including returned
goods), if any, relating to the sale which gave rise to such Receivable;
(b) all other security interests or Liens and property subject
thereto from time to time purporting to secure payment of such Receivable,
whether pursuant to the contract related to such Receivable or otherwise,
together with all financing statements signed by an Obligor describing any
collateral securing such Receivable; and
(c) all guarantees, insurance, letters of credit (including any
Eligible Letter of Credit) and other agreements or arrangements of
whatever character from time to time supporting or securing payment of
such Receivable whether pursuant to the contract related to such
Receivable or otherwise;
including in the case of clauses (b) and (c), without limitation, pursuant to
any obligations evidenced by an account, note, instrument, contract, security
agreement, chattel paper, general intangible or other evidence of indebtedness
or security.
"Reported Day" shall have the meaning specified in subsection
4.01(a) of the Servicing Agreement.
Amended and Restated Pooling Agreement 34
"Requirement of Law" for any Person shall mean the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person, and any law, treaty, rule or regulation, or determination of an
arbitrator or a court or other Governmental Authority, in each case applicable
to or binding upon such Person or any of its property or to which such Person or
any of its property is subject.
"Responsible Officer" shall mean (i) when used with respect to the
Trustee, any officer within the Corporate Trust Office of the Trustee including
any Vice President, any Assistant Vice President, Trust Officer or Assistant
Trust Officer or any other officer of the Trustee customarily performing
functions similar to those performed by any of the above designated officers and
(ii) when used with respect to any other Person, the Chairman of the Board, any
Vice Chairman of the Board, the Chief Executive Officer, the President, the
Chief Financial Officer, any Vice President or the Treasurer of such Person.
"Restricted Payments" shall have the meaning assigned in subsection
2.08(o).
"Revolving Period" shall have, with respect to any Outstanding
Series, the definition assigned to such term in the related Supplement.
"S&P" shall mean Standard & Poor's Ratings Services, a division of
The ▇▇▇▇▇▇-▇▇▇▇ Companies, Inc. or any successor thereto.
"Securities Act" shall mean the Securities Act of 1933.
"Seller" shall mean each Seller listed as a party to, on Schedule 1
of, the Receivables Sale Agreement.
"Seller Material Adverse Effect" shall mean, with respect to any
Seller, (i) any material impairment of such
Amended and Restated Pooling Agreement 35
Seller's ability to perform any of its material obligations or to comply with or
conduct its business in accordance with any of its material representations,
warranties, covenants or agreements under any Transaction Document or (ii) any
material impairment of the interests, rights or remedies of the Trustee or the
Investor Certificateholders against or with respect to such Seller under any
Transaction Document, including any interests, rights or remedies of the Trustee
or the Investor Certificateholders as an assignee or assignees of the Company
under, or a third-party beneficiary or third-party beneficiaries of, the
Receivables Sale Agreement.
"Seller Note" shall have the meaning specified in Section 8.01 of
the Receivables Sale Agreement.
"Series" shall mean any series of Investor Certificates and any
related Subordinated Company Interest, the terms of which are set forth in a
Supplement.
"Series Account" shall mean any deposit, trust, escrow, reserve or
similar account maintained for the benefit of the Investor Certificateholders
and the holders of the related Subordinated Company Interest of any Series or
Class, as specified in any Supplement.
"Series Collection Subaccount" shall have the meaning specified in
subsection 3.01(a).
"Series Collection Sub-subaccount" shall have the meaning specified
in subsection 3.01(a).
"Series Non-Principal Collection Sub-subaccount" shall have the
meaning specified in subsection 3.01(a).
"Series Principal Collection Sub-subaccount" shall have the meaning
specified in subsection 3.01(a).
Amended and Restated Pooling Agreement 36
"Series Termination Date" shall have, with respect to any Series,
the meaning specified in the related Supplement for such Series.
"Service Transfer" shall have the meaning specified in Section 6.01
of the Servicing Agreement.
"Servicer" shall initially mean each Servicer identified in Schedule
1 to the Receivables Sale Agreement and, after any Service Transfer, the
Successor Servicer.
"Servicer Default" shall have, with respect to any Series, the
meaning specified in Section 6.01 of the Servicing Agreement and, if applicable,
as supplemented by the related Supplement for such Series.
"Servicer Material Adverse Effect" shall mean, with respect to the
Master Servicer or any Servicer, (i) any material impairment of such Person's
ability to perform any of its material obligations or to comply with or conduct
its business in accordance with any of its material representations, warranties,
covenants or agreements under any Transaction Document or (ii) any material
impairment of the interests, rights or remedies of the Trustee or the Investor
Certificateholders against or with respect to such Person under any Transaction
Document.
"Servicer Site Review" shall mean a review performed by the Trustee
of the servicing operations of the Servicer's central site locations, as
described in Appendix A.
"Servicing Agreement" shall have the meaning specified in the
recitals hereto.
"Servicing Fee" shall have the meaning specified in subsection
2.05(a) of the Servicing Agreement.
"Servicing Fee Percentage" shall mean 1% per annum.
Amended and Restated Pooling Agreement 37
"Settlement Period" shall mean each fiscal month of the Servicers.
"Settlement Report Date" shall mean, except as otherwise set forth
in the applicable Supplement, the 10th day of each calendar month or, if such
10th day is not a Business Day, the next succeeding Business Day.
"Special Allocation Settlement Report Date" shall have the meaning
specified in subsection 3.01(e).
"Specified Bankruptcy Opinion Provisions" shall mean the factual
assumptions (including those contained in the factual certificate referred to
therein) and the actions to be taken by the Sellers or the Company in each case
in the legal opinion of ▇▇▇▇▇▇, ▇▇▇▇▇ & Bockius LLP relating to certain
bankruptcy matters delivered on each Issuance Date.
"Standby Liquidation System" shall mean a system by which the
Trustee will receive and store electronic information regarding Receivables from
the Servicers which may be utilized in the event of a liquidation of the
Receivables to be carried out by the Trustee, as described in Appendix B.
"State/Local Government Obligor" shall mean any state or local
government or any subdivision thereof or any agency, department, or
instrumentality thereof.
"Subordinated Interest Amount" shall have, with respect to any
Outstanding Series, the meaning specified in the related Supplement for such
Outstanding Series.
"Subordinated Company Interest" shall mean any Interest issued to
the Company pursuant to the Supplement for any Series which represents an
interest in the Trust Assets which is subordinated to the Investor Certificates
of such Series.
Amended and Restated Pooling Agreement 38
"Subordinated Interest Register" shall have the meaning specified in
subsection 5.10(d).
"Subsidiary" shall mean, as to any Person, a corporation,
partnership or other entity of which shares of stock or other ownership
interests having ordinary voting power (other than stock or such other ownership
interests having such power only by reason of the happening of a contingency) to
elect a majority of the board of directors or other managers of such
corporation, partnership or other entity are at the time owned, or the
management of which is otherwise controlled, directly or indirectly through one
or more intermediaries, or both, by such Person.
"Successor Master Servicer" shall have the meaning specified in
Section 6.02 of the Servicing Agreement.
"Successor Servicer" shall have the meaning specified in Section
6.02 of the Servicing Agreement.
"Supplement" shall mean, with respect to any Series, a supplement to
this Agreement complying with the terms of Section 5.10(c), executed in
conjunction with the issuance of any Series.
"Target Receivables Amount" shall have, with respect to any
Outstanding Series, the meaning specified in the related Supplement for such
Outstanding Series.
"Tax Opinion" shall mean, unless otherwise specified in the
Supplement for any Series with respect to such Series or any Class within such
Series, with respect to any action, an opinion of counsel (a) to the effect
that, for United States federal income tax purposes, (i) such action will not
adversely affect the characterization as debt of any Investor Certificates of
any Outstanding Series or Class not retained by the Company, (ii) in the case of
Section 5.10, the Investor Certificates of the new Series that are not retained
by the Company will be characterized as debt or should be characterized as debt
and if not so
Amended and Restated Pooling Agreement 39
treated, will be characterized as equity interests in a partnership between the
Company and one or more Classes of the Investor Certificateholders, which
partnership will not be considered a publicly traded partnership taxable as a
corporation and (iii) following such action, the Trust will not be an
association (or publicly traded partnership) taxable as a corporation and (b)
with respect to state taxation issues regarding the taxation of the Trust, in
substantially the form delivered at the Initial Closing Date.
"Tax Sharing Agreement" shall mean the Tax Sharing Agreement, dated
August 5, 1996, among Furnishings International Inc., Lifestyle Furnishings
International Ltd., the Company and ▇▇▇▇▇▇▇ Upholstered Furniture Corporation.
"Termination Notice" shall have the meaning specified in Section
6.01 of the Servicing Agreement.
"Transactions" shall have the meaning specified in subsection
2.03(b).
"Transaction Documents" shall mean the collective reference to this
Agreement, the Servicing Agreement, each Supplement with respect to any
Outstanding Series, the Receivables Sale Agreement, the Lockbox Agreements, the
Investor Certificates, the Tax Sharing Agreement and any other documents
delivered pursuant to or in connection therewith.
"Transfer Agent and Registrar" shall have the meaning specified in
Section 5.03 and shall initially be the Trustee.
"Transfer Deposit Amount" shall have the meaning specified in
subsection 2.05(b).
"Transferred Agreements" shall have the meaning assigned in
subsection 2.01(a)(v).
Amended and Restated Pooling Agreement 40
"Trust" shall mean the LFI Receivables Master Trust created by this
Agreement.
"Trust Assets" shall have the meaning specified in subsection
2.01(a).
"Trust Termination Date" shall have the meaning specified in
subsection 9.01(a).
"Trustee" shall mean the institution executing this Agreement as
trustee, or its successor in interest, or any successor trustee appointed as
herein provided.
"Trustee Force Majeure Delay" shall mean any cause or event that is
beyond the control and not due to the gross negligence of the Trustee that
delays, prevents or prohibits the Trustee's performance of its duties under
Article III, including acts of God, floods, fire, explosions of any kind,
snowstorms and other irregular weather conditions, unanticipated employee
absenteeism, mass transportation disruptions, any of power failure, telephone
failure or computer failure in the office of the Trustee, including without
limitation, failure of the Chemlink or any similar system or failure of the Fed
Wire system operated by the Federal Reserve Bank of New York and all similar
events. The Trustee shall notify the Company as soon as reasonably possible
after the beginning of any such delay.
"UCC" shall mean the Uniform Commercial Code, as amended from time
to time, as in effect in any specified jurisdiction.
"UCP 500" shall mean "The Uniform Customs and Practices for
Documentary Credits", 1993 Revision, International Chamber of Commerce
Publication No. 500.
"Variable Funding Certificates" or "VFC Certificates" shall have the
meaning specified in Section 5.10.
Amended and Restated Pooling Agreement 41
SECTION 1.02. Other Definitional Provisions. (a) All terms defined
in this Agreement, the Servicing Agreement or in any Supplement shall have such
defined meanings when used in any certificate or other document made or
delivered pursuant hereto unless otherwise defined therein.
(b) As used herein and in any certificate or other document made or
delivered pursuant hereto or thereto, accounting terms not defined in Section
1.01, and accounting terms partly defined in Section 1.01 to the extent not
defined, shall have the respective meanings given to them under GAAP. To the
extent that the definitions of accounting terms herein are inconsistent with the
meanings of such terms under GAAP, the definitions contained herein shall
control.
(c) 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; and Section,
subsection, Schedule, Exhibit and Appendix references contained in this
Agreement are references to Sections, subsections, Schedules, Exhibits and
Appendices in or to this Agreement unless otherwise specified.
(d) The definitions contained in Section 1.01 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.
(e) Where a definition contained in Section 1.01 specifies that such
term shall have the meaning set forth in the related Supplement, the definition
of such term set forth in the related Supplement may be preceded by a prefix
indicating the specific Series or Class to which such definition shall apply.
(f) Where reference is made in this Agreement or any related
Supplement to the principal amount of
Amended and Restated Pooling Agreement 42
Receivables, such reference shall, unless explicitly stated otherwise, be deemed
a reference to the Principal Amount (as such term is defined in Section 1.01) of
such Receivables.
(g) Any reference herein or in any other Transaction Document to a
provision of the Bankruptcy Code, the Internal Revenue Code or ERISA shall be
deemed a reference to any successor provision thereto.
(h) Any reference herein to a Schedule, Exhibit or Appendix to this
Agreement shall be deemed to be a reference to such Schedule, Exhibit or
Appendix as it may be amended, modified or supplemented from time to time to the
extent that such Schedule, Exhibit or Appendix may be amended, modified or
supplemented (or any term or provision of any Transaction Document may be
amended that would have the effect of amending, modifying or supplementing
information contained in such Schedule, Exhibit or Appendix) in compliance with
the terms of the Transaction Documents.
(i) Any reference herein to any representation, warranty or covenant
"deemed" to have been made is intended to encompass only representations,
warranties or covenants that are expressly stated to be repeated on or as of
dates following the execution and delivery of this Agreement, and no such
reference shall be interpreted as a reference to any implicit, inferred, tacit
or otherwise unexpressed representation, warranty or covenant.
(j) The words "include", "includes" or "including" shall be
interpreted as if followed, in each case, by the phrase "without limitation".
Amended and Restated Pooling Agreement 43
ARTICLE II
Conveyance of Receivables;
Representations, Warranties and Covenants
SECTION 2.01. Conveyance of Receivables. (a) By execution and
delivery of this Agreement, the Company does hereby assign, set over and
otherwise convey to the Trust for the benefit of the Holders, without recourse
(except as specifically provided herein), all its present and future right,
title and interest in, to and under:
(i) all Receivables, including those existing at the close of
business on the Initial Closing Date and all Receivables thereafter
arising from time to time until but not including the Trust Termination
Date;
(ii) the Related Property;
(iii) all Collections;
(iv) all rights (including rescission, replevin or reclamation)
relating to any Receivable or arising therefrom;
(v) each of the Receivables Sale Agreement and the Servicing
Agreement, including in respect of each agreement, (A) all rights of the
Company to receive monies due and to become due under or pursuant to such
agreement, whether payable as fees, expenses, costs or otherwise, (B) all
rights of the Company to receive proceeds of any insurance, indemnity,
warranty or guaranty with respect to such agreement, (C) claims of the
Company for damages arising out of or for breach of or default under such
agreement, (D) the right of the Company to amend, waive or terminate such
agreement, to perform thereunder and to compel performance and otherwise
exercise all remedies thereunder and (E) all other rights, remedies,
powers, privileges and claims of the Company under or in connection with
such
Amended and Restated Pooling Agreement 44
agreement (whether arising pursuant to such agreement or otherwise
available to the Company at law or in equity), including the rights of the
Company to enforce such agreement and to give or withhold any and all
consents, requests, notices, directions, approvals, extensions or waivers
under or in connection therewith (all of the foregoing set forth in
subclauses (v)(A) through (E), inclusive, the "Transferred Agreements");
(vi) the Collection Account, each Lockbox and each Lockbox Account
(collectively, the "Accounts"), including (A) all funds and other
evidences of payment held therein and all certificates and instruments, if
any, from time to time representing or evidencing any of such Accounts or
any funds and other evidences of payment held therein, (B) all investments
of such funds held in such Accounts and all certificates and instruments
from time to time representing or evidencing such investments, (C) all
notes, certificates of deposit and other instruments from time to time
hereafter delivered or transferred to, or otherwise possessed by, the
Trustee for and on behalf of the Company in substitution for any of the
then existing Accounts and (D) all interest, dividends, cash, instruments
and other property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any and all of the then
existing Accounts; and
(vii) all proceeds of or payments in respect of any and all of the
foregoing clauses (i) through (vi) (including proceeds that constitute
property of the types described in clause (vi) above and including
Collections).
Such property described in the foregoing clauses (i) through (vii), together
with all investments and all monies on deposit in any other bank account or
accounts maintained for the benefit of any Holders for payment to Holders shall
constitute the assets of the Trust (the "Trust Assets").
Amended and Restated Pooling Agreement 45
Subject to Section 5.09, although it is the intent of the parties to
this Agreement that the conveyance of the Company's right, title and interest
in, to and under the Receivables and the other Trust Assets pursuant to this
Agreement shall constitute a purchase and sale and not a loan, in the event that
such conveyance is deemed to be a loan, it is the intent of the parties to this
Agreement that the Company hereby grants to the Trustee for the benefit of the
Holders a perfected first priority security interest in all of the Company's
present and future right, title and interest in, to and under the Receivables
and the other Trust Assets, and that this Agreement shall constitute a security
agreement under applicable law in favor of the Trustee, for the benefit of the
Holders.
(b) The assignment, setover and conveyance to the Trust pursuant to
Section 2.01(a) shall be made to the Trustee, on behalf of the Trust, and each
reference in this Agreement to such assignment, setover and conveyance shall be
construed accordingly. In connection with the foregoing assignment, the Company
and the Master Servicer agree to deliver to the Trustee each Trust Asset
evidencing a Receivable to be included as an Eligible Receivable or any Related
Property with respect thereto (including any original document or instrument
necessary to effect or to perfect such assignment) in which the transfer of an
interest is being perfected under the UCC or otherwise by possession and not by
filing a financing statement or similar document (although a precautionary
filing of a financing statement or similar document is expected to be made in
respect of each such Trust Asset). Without limiting the generality of the
foregoing sentence, the Company and the Master Servicer agree to deliver or
cause to be delivered to the Trustee an original of (i) any promissory note or
other instrument evidencing a Receivable sold to the Trust, (ii) any chattel
paper evidencing a Receivable sold to the Trust and (iii) each Eligible Letter
of Credit related to any Person that is to be considered an Eligible Obligor on
the basis of paragraph (a) of the definition of "Eligible Obligor".
Amended and Restated Pooling Agreement 46
Notwithstanding the assignment of the Transferred Agreements set
forth in Section 2.01(a), the Company does not hereby assign or delegate any of
its duties or obligations under the Receivables Sale Agreement to the Trust or
the Trustee and neither the Trust nor the Trustee accepts such duties or
obligations, and the Company shall continue to have the right and the obligation
to purchase Receivables from the Sellers thereunder from time to time and to
consummate the other transactions and take any actions contemplated thereby. The
foregoing assignment, set-over and conveyance does not constitute and is not
intended to result in a creation or an assumption by the Trust, the Trustee, any
Investor Certificateholder or the Company, in its capacity as a Holder, of any
obligation of the Master Servicer, the Servicers, the Company, the Sellers or
any other Person in connection with the Receivables or under any agreement or
instrument relating thereto, including, without limitation, any obligation to
any Obligor.
In connection with such assignment, the Company agrees to record and
file, or cause to be recorded or filed, at its own expense, any financing
statements (and continuation statements with respect to such financing
statements when applicable) or, where applicable, registrations in the
appropriate records, (i) with respect to the Receivables now existing and
hereafter created and (ii) with respect to any other Trust Assets for which a
security interest may be perfected under the relevant UCC, legislation or
similar statute by such filing or registration, as the case may be, in each case
meeting the requirements of applicable law in such manner and in such
jurisdictions as are necessary to perfect and maintain perfection of the
assignment of the Receivables and such other Trust Assets (excluding returned
merchandise) to the Trust, and to deliver a file-stamped copy or certified
statement of such financing statement or registration or other evidence of such
filing or registration to the Trustee on or prior to the date of issuance of any
Investor Certificates, any Subordinated Company Interest or the
Amended and Restated Pooling Agreement 47
Exchangeable Company Interest. The Trustee shall be under no obligation
whatsoever to file such financing statement, or a continuation statement to such
financing statement, or to make any other filing or other registration under the
UCC, other relevant legislation or similar statute in connection with such
transfer. The Trustee shall be entitled to conclusively rely on the filings or
registrations made by or on behalf of the Company without any independent
investigation and the Company's obligation to make such filings as evidence that
such filings have been made.
In connection with such assignment, the Company further agrees, at
its own expense, on or prior to the Initial Closing Date and each Issuance Date
(a) to indicate, or to cause to be indicated, in its computer files containing
its master database of Receivables and to cause each Seller to indicate in its
records containing its master database of Receivables that Receivables have been
conveyed to the Company or the Trust, as the case may be, pursuant to the
Receivables Sale Agreement or this Agreement, respectively, for the benefit of
the Holders and (b) to deliver or transmit or cause to be delivered or
transmitted to the Trustee computer tapes, diskettes or data transmission
containing a true and complete list of all Receivables transferred to the Trust
specifying for each such Receivable, as of the Cut-Off Date, at least (i) the
name of the Obligor and (ii) the aggregate Principal Amount of the Receivables
owing by such Obligor. Such tapes, diskettes or data transmission shall
constitute Schedule 1 to this Agreement and are hereby incorporated into and
made a part of this Agreement whether they are delivered together with or
separate from this Agreement.
SECTION 2.02. Acceptance by Trustee. (a) The Trustee hereby
acknowledges its acceptance on behalf of the Trust of all right, title and
interest in, to and under the property, now existing and hereafter created,
assigned to the Trust pursuant to Section 2.01 and declares that it shall
maintain such right, title and interest, upon the
Amended and Restated Pooling Agreement 48
trust herein set forth, for the benefit of all Holders. The Trustee further
acknowledges that, prior to or simultaneous with the execution and delivery of
this Agreement, the Company delivered to the Trustee the computer tapes
containing a list of the Receivables described in the last paragraph of Section
2.01. The Trustee shall maintain a copy of Schedule 1, as delivered from time to
time, at the Corporate Trust Office.
(b) 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.
SECTION 2.03. Representations and Warranties of the Company Relating
to the Company. The Company hereby represents and warrants to the Trustee and
the Trust, for the benefit of the Holders, as of the Issuance Date of such
Series, that:
(a) Organization; Powers. The Company (i) is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization, (ii) has all requisite power and authority to
own its property and assets and to carry on its business as now conducted and as
proposed to be conducted, (iii) is qualified to do business in, and is in good
standing in, every jurisdiction where the nature of its business so requires,
except where the failure so to qualify could not reasonably be expected to
result in a Company Material Adverse Effect and (iv) has the corporate power and
authority to execute, deliver and perform its obligations under each of the
Transaction Documents and each other agreement or instrument contemplated hereby
to which it is or will be a party.
(b) Authorization. The execution, delivery and performance by the
Company of each of the Transaction Documents and the other transactions
contemplated hereby (collectively, the "Transactions") (i) have been duly
authorized by all requisite corporate and, if required,
Amended and Restated Pooling Agreement 49
stockholder action and (ii) will not (A) violate (1) any Requirement of Law or
(2) any provision of any Transaction Document or any other material Contractual
Obligation to which the Company is a party or by which it or any of its property
is or may be bound, (B) be in conflict with, result in a breach of or constitute
(alone or with notice or lapse of time or both) a default under, or give rise to
any right to accelerate or to require the prepayment, repurchase or redemption
of any obligation under any Transaction Document or any other material
Contractual Obligation or (C) result in the creation or imposition of any Lien
upon or with respect to any property or assets now owned or hereafter acquired
by the Company (other than any Lien created hereunder or contemplated or
permitted hereby).
(c) Enforceability. This Agreement has been duly executed and
delivered by the Company and constitutes, and each other Transaction Document to
which the Company is a party when executed and delivered by the Company will
constitute, a legal, valid and binding obligation of the Company enforceable
against it in accordance with its respective terms, subject (a) as to
enforcement of remedies, to applicable bankruptcy, insolvency, reorganization,
moratorium and other similar laws affecting the enforcement of creditors' rights
generally, from time to time in effect and (b) to general principles of equity
(whether enforcement is sought by a proceeding in equity or at law).
(d) Governmental Approvals. No action, consent or approval of,
registration or filing with or any other action by any Governmental Authority is
or will be required in connection with the Transactions, except for (i) the
filing of appropriate UCC financing statements and (ii) such as have been made
or obtained and are in full force and effect; provided, however, that with
respect to Receivables owing by Government Obligors, any failure by the Company
to comply with the United States Federal Nonassignment Act (Public Contracts),
41 U.S.C. ss. 15, or Assignment of Claims Act, 31 U.S.C. ss. 3727, or with any
similar legislation of
Amended and Restated Pooling Agreement 50
any State shall not constitute a breach of this subsection 2.03(d).
(e) Litigation; Compliance with Laws. (i) There are not any actions,
suits or proceedings at law or in equity or by or before any Governmental
Authority now pending or, to the knowledge of the Company, threatened against or
affecting the Company or any business, property or rights of the Company, an
adverse decision in which could reasonably be expected to have a Company
Material Adverse Effect.
(ii) The Company is not in default with respect to any judgment,
writ, injunction, decree or order of any Governmental Authority.
(f) Agreements. (i) The Company has no Contractual Obligations other
than (A) the Transaction Documents to which it is a party (including the Seller
Note) and (B) any other agreements or instruments that the Company is not
prohibited from entering into by subsection 2.08(g) and that, in the aggregate,
neither contain payment obligations or other liabilities on the part of the
Company in excess of $50,000 nor would upon default result in a Company Material
Adverse Effect. The Company is not subject to any corporate restriction that
could reasonably be expected to have a Company Material Adverse Effect.
(ii) The Company is not in default in any material respect under any
provision of any Transaction Document or any other material Contractual
Obligation to which it is a party or by which it or any of its properties or
assets are or may be bound.
(g) Federal Reserve Regulations. (i) The Company is not engaged
principally, or as one of its important activities, in the business of extending
credit for the purpose of buying or carrying Margin Stock.
Amended and Restated Pooling Agreement 51
(ii) No part of the proceeds from the issuance of any Investor
Certificates will be used, whether directly or indirectly, and whether
immediately, incidentally or ultimately, for any purpose that entails a
violation of, or that is inconsistent with, the provisions of the Regulations of
the Board, including Regulation G, U or X.
(h) Investment Company Act. Neither the Company nor the Trust is an
"investment company" as defined in, or subject to regulation under, the 1940
Act.
(i) No Early Amortization Event. No Early Amortization Event or
Potential Early Amortization Event has occurred and is continuing.
(j) Tax Returns. The Company has filed or caused to be filed all
Federal, state or other material tax returns required to have been filed by it
and has paid or caused to be paid all taxes due and payable by it and all
assessments received by it to the extent that such failure to file or nonpayment
could reasonably be expected to have a Material Adverse Effect.
(k) Location of Records; Chief Executive Office. The offices at
which the Company keeps its records concerning the Receivables either (x) are
located at the addresses set forth for the Sellers on Schedule 4 of the
Receivables Sale Agreement or (y) the Company has notified the Trustee of the
location thereof in accordance with the provisions of subsection 2.08(j) of this
Agreement. The chief executive office of the Company is located at the address
set forth on Schedule 3 and is the place where the Company is "located" for the
purposes of Section 9-103(3)(d) of the UCC as in effect in the State of New
York. As of the Initial Closing Date, the state and county where the chief
executive office of the Company is "located" for the purposes of Section
9-103(3)(d) of the UCC as in effect in the State of New York has not changed in
the past four months.
Amended and Restated Pooling Agreement 52
(l) Solvency. No Insolvency Event with respect to the Company has
occurred and the transfer of the Receivables by the Company to the Trust has not
been made in contemplation of the occurrence thereof. Both prior to and after
giving effect to the transactions occurring on each Issuance Date, (i) the fair
value of the assets of the Company at a fair valuation will exceed the debts and
liabilities, subordinated, contingent or otherwise, of the Company; (ii) the
present fair salable value of the property of the Company will be greater than
the amount that will be required to pay the probable liability of the Company on
its debts and other liabilities, subordinated, contingent or otherwise, as such
debts and liabilities become absolute and matured; (iii) the Company will be
able to pay its debts and liabilities, subordinated, contingent or otherwise, as
such debts and liabilities become absolute and matured; and (iv) the Company
will not have unreasonably small capital with which to conduct the business in
which it is engaged as such business is now conducted and is proposed to be
conducted. For all purposes of clauses (i) through (iv) above, the amount of
contingent liabilities at any time shall be computed as the amount that, in the
light of all the facts and circumstances existing at such time, represents the
amount that can reasonably be expected to become an actual or matured liability.
The Company does not intend to, nor does it believe that it will, incur debts
beyond its ability to pay such debts as they mature, taking into account the
timing of and amounts of cash to be received by it and the timing of and amounts
of cash to be payable in respect of its Indebtedness.
(m) Ownership; Subsidiaries. All of the issued and outstanding
capital stock of the Company is owned, legally and beneficially, by Lifestyle
Holdings Ltd. The Company has no Subsidiaries.
(n) Names. The legal name of the Company is as set forth in this
Agreement. The Company has no trade names, fictitious names, assumed names or
"doing business as" names.
Amended and Restated Pooling Agreement 53
(o) Liabilities. Other than, (i) the liabilities, commitments or
obligations (whether absolute, accrued, contingent or otherwise) arising under
or in respect of the Transaction Documents and (ii) immaterial amounts due and
payable in the ordinary course of business of a special-purpose company, the
Company does not have any liabilities, commitments or obligations (whether
absolute, accrued, contingent or otherwise), whether due or to become due.
(p) Collection Procedures. The Company and the Sellers have in place
procedures pursuant to the Transaction Documents which are either necessary or
advisable to ensure the timely collection of Receivables.
(q) Lockbox Agreements; Lockbox Accounts. Except to the extent
otherwise permitted under the terms of this Agreement, (i) each Lockbox
Agreement to which the Company is party is in full force and effect and (ii)
each Lockbox Account set forth in Schedule 3 to the Receivables Sales Agreement
is free and clear of any Lien.
(r) Company Material Adverse Effect. Since the incorporation of the
Company, no event has occurred which has had a Company Material Adverse Effect.
The representations and warranties as of the date made set forth in
this Section 2.03 shall survive the transfer and assignment of the Trust Assets
to the Trust. Upon discovery by a Responsible Officer of the Company or a
Servicer or by a Responsible Officer of the Trustee of a breach of any of the
foregoing representations and warranties with respect to any Outstanding
Series as of the Issuance Date of such Series, the party discovering such breach
shall give prompt written notice to the other parties and to each Agent with
respect to all Outstanding Series. The Trustee's obligations in respect of any
breach are limited as provided in Section 8.02(g).
Amended and Restated Pooling Agreement 54
SECTION 2.04. Representations and Warranties of the Company Relating
to the Receivables. The Company hereby represents and warrants to the Trustee
and the Trust, for the benefit of the Holders, with respect to each Receivable
transferred to the Trust as of the related Receivables Purchase Date, unless, in
either case, otherwise stated in the applicable Supplement or unless such
representation or warranty expressly relates only to a prior date, that:
(a) Receivables Description. As of the Cut-Off Date, Schedule 1 to
this Agreement sets forth a complete listing of all Receivables,
aggregated by Obligor, transferred to the Trust as of the Cut-Off Date and
the information contained therein specified in clauses (i) and (ii) of the
last paragraph of subsection 2.01(b) with respect to each such Receivable
is true and correct (except for any errors or omissions that do not result
in material impairment of the interests, rights or remedies of the Trustee
or the Investor Certificateholders with respect to any Receivable) as of
the Cut-Off Date. As of the Cut-Off Date, the aggregate amount of
Receivables owned by the Company is accurately set forth in Schedule 1
hereto.
(b) No Liens. Each Receivable existing on the Initial Closing Date
or, in the case of Receivables transferred to the Trust after the Initial
Closing Date, on the date that each such Receivable shall have been
transferred to the Trust, has been conveyed to the Trust free and clear of
any Lien, except for Permitted Liens.
(c) Eligible Receivable. To the Company's knowledge, on the Initial
Closing Date, each Receivable transferred to the Trust that is included in
the calculation of the initial Aggregate Receivables Amount is an Eligible
Receivable and, in the case of Receivables transferred to the Trust after
the Initial Closing Date, on the date such Receivable shall have been
transferred to the Trust, each such Receivable
Amended and Restated Pooling Agreement 55
that is included in the calculation of the Aggregate Receivables Amount on
such date is an Eligible Receivable.
(d) Filings. On or prior to the Initial Closing Date, all filings
and other acts necessary (including but not limited to all filings and
other acts necessary or advisable under the UCC) shall have been made or
performed in order to grant the Trust on the Initial Closing Date a first
priority perfected ownership or security interest in respect of all
Receivables.
The representations and warranties as of the date made set forth in
this Section 2.04 shall survive the transfer and assignment of the Trust Assets
to the Trust. Upon discovery by a Responsible Officer of the Company, the Master
Servicer or a Servicer or a Responsible Officer of the Trustee of a breach of
any of the representations and warranties (or of any Receivable encompassed by
the representation and warranty in subsection 2.04(c) not being an Eligible
Receivable as of the relevant Receivables Purchase Date) with respect to each
Outstanding Series as of the Issuance Date of such Series, the party discovering
such breach shall give prompt written notice to the other parties and to each
Agent with respect to all Outstanding Series. The Trustee's obligations in
respect of any breach are limited as provided in Section 8.02(g).
SECTION 2.05. Adjustment Payment for Ineligible Receivables. (a)
Adjustment Payment Obligation. If (i) any representation or warranty under
subsections 2.04(a) or (b) is not true and correct as of the date specified
therein with respect to any Receivable transferred to the Trust or any
Receivable encompassed by the representation and warranty in subsection 2.04(c)
is determined not to be an Eligible Receivable as of the relevant Receivables
Purchase Date, (ii) there is a breach of any covenant under subsection 2.08(c)
with respect to any Receivable or (iii) the Trust's interest in any Receivable
is not a first priority perfected ownership or security interest at any
Amended and Restated Pooling Agreement 56
time as a result of any action taken by, or the failure to take action by, the
Company (any Receivable as to which the conditions specified in any of clause
(i), (ii) or (iii) of this subsection 2.05(a) exists is referred to herein as an
"Ineligible Receivable") then, after the earlier (the date on which such earlier
event occurs, the "Ineligibility Determination Date"), to occur of the discovery
by the Company of any such event that continues unremedied or receipt by the
Company of written notice given by the Trustee or any Servicer of any such event
that continues unremedied, the Company shall make an adjustment payment with
respect to such Ineligible Receivable on the terms and conditions set forth in
subsection 2.05(b).
(b) Adjustment Payment Amount. Subject to the last sentence of this
subsection 2.05(b), the Company shall make an adjustment payment with respect to
each Ineligible Receivable as required pursuant to subsection 2.05(a) by
depositing in the Collection Account in immediately available funds on the
Business Day following the related Ineligibility Determination Date an amount
equal to the lesser of (x) the amount by which the Aggregate Target Receivables
Amount exceeds the Aggregate Receivables Amount (after giving effect to the
reduction thereof by the Principal Amount of such Ineligible Receivable) and (y)
the aggregate outstanding Principal Amount of all such Ineligible Receivables
(the "Transfer Deposit Amount"). Upon transfer or deposit of the Transfer
Deposit Amount, the Trust shall automatically and without further action be
deemed to have agreed to pay to the Company, without recourse, representation or
warranty, all Collections in respect of each such Ineligible Receivable. Except
as otherwise specified in any Supplement, the obligation of the Company to pay
such Transfer Deposit Amount with respect to any Ineligible Receivables shall
constitute the sole remedy respecting the event giving rise to such obligation
available to Investor Certificateholders (or the Trustee on behalf of Investor
Certificateholders).
Amended and Restated Pooling Agreement 57
SECTION 2.06. Purchase of Investor Certificateholders' Interest in
Trust Portfolio. (a) In the event of any breach of any of the representations
and warranties set forth in paragraph (a), (b), (c), (d) or (e)(i) of Section
2.03 as of the date made, which breach has a Material Adverse Effect, then the
Trustee, at the written direction of holders evidencing more than 50% of the
Invested Amount of each affected Outstanding Series, shall notify the Company to
purchase such Outstanding Series and the Company shall be obligated to make such
purchase on the next Distribution Date occurring at least five Business Days
after receipt of such notice on the terms and conditions set forth below;
provided however, that no such purchase shall be required to be made if, by such
Distribution Date, any Material Adverse Effect caused thereby shall have been
cured.
(b) The Company shall deposit into the Collection Account for credit
to the applicable subaccount of the Collection Account on the Business Day
preceding such Distribution Date an amount equal to the purchase price (as
described in the next succeeding sentence) for the Investor Certificateholders'
Interest for such Outstanding Series on such day. The purchase price for any
such purchase will be equal to (i) the Adjusted Invested Amount of such
Outstanding Series on the date on which the purchase is made plus (ii) an amount
equal to all interest accrued but unpaid on such Series up to the Distribution
Date on which the distribution of such deposit is scheduled to be made pursuant
to Section 9.02 plus (iii) any other amount required to be paid in connection
therewith pursuant to any Supplement. Notwithstanding anything to the contrary
in this Agreement, the entire amount of the purchase price deposited in the
Collection Account shall be distributed to the related Investor
Certificateholders on such Distribution Date pursuant to Section 9.02. If the
Trustee gives notice directing the Company to purchase the Investor Certificates
of an Outstanding Series as provided above, except as otherwise specified in any
Supplement, the obligation of the Company to purchase such Investor Certificates
pursuant to
Amended and Restated Pooling Agreement 58
this Section 2.06 shall constitute the sole remedy respecting an event of the
type specified in the first sentence of this Section 2.06 available to the
applicable Investor Certificateholders (or the Trustee on behalf of such
Investor Certificateholders).
SECTION 2.07. Affirmative Covenants of the Company. The Company
hereby covenants that, until the Trust Termination Date occurs, the Company
shall:
(a) Financial Statements, Reports, etc.
(i) Furnish to the Trustee, each Agent and the Rating
Agencies, within 90 days after the end of each fiscal year, the
balance sheet and related statements of income, stockholders' equity
and cash flows showing the financial condition of the Company as of
the close of such fiscal year and the results of its operations
during such year, all audited by the Company's Independent Public
Accountants and accompanied by an opinion of such accountants (which
shall not be qualified in any material respect) to the effect that
such financial statements fairly present the financial condition and
results of operations of the Company in accordance with GAAP
consistently applied;
(ii) Furnish to the Trustee, each Agent and the Rating Agencies,
within 45 days after the end of each of the first three fiscal
quarters of each fiscal year, the Company's balance sheet and
related statements of income, stockholders' equity and cash flows
showing the financial condition of the Company as of the close of
such fiscal quarter and the results of its operations during such
fiscal quarter and the then elapsed portion of the fiscal year (and,
beginning with the second fiscal year, showing, on a comparative
basis, such information as of and for the corresponding dates and
periods of the preceding fiscal year), all
Amended and Restated Pooling Agreement 59
certified by a Responsible Officer of such Person as fairly
representing the financial condition and results of operations of
the Company in accordance with GAAP consistently applied, subject to
normal year-end audit adjustments; and
(iii) Furnish to the Trustee and each Agent, promptly, from time
to time, such other information regarding the operations, business
affairs and financial condition of the Company, or compliance with
the terms of any Transaction Document, in each case as any Agent or
the Trustee may reasonably request.
(b) Annual Opinion. Deliver to the Trustee and the Rating Agencies
an Opinion of Counsel substantially in the form of Exhibit B, by January
31st of each fiscal year of the Company commencing with the fiscal year
ending December 31, 1997.
(c) Payment of Obligations; Compliance with Obligations. Pay,
discharge or otherwise satisfy at or before maturity or before they become
delinquent, as the case may be, all its obligations of whatever nature,
except where the amount or validity thereof is currently being contested
in good faith by appropriate proceedings and reserves in conformity with
GAAP with respect thereto have been provided on the books of the Company
or where the failure to pay, discharge or otherwise satisfy such
obligation would not have a Company Material Adverse Effect. The Company
shall defend the right, title and interest of the Holders in, to and under
the Receivables and the other Trust Assets, whether now existing or
hereafter created, against all claims of third parties claiming through or
under the Company, the Sellers, the Master Servicer or the Servicers. The
Company will duly fulfill all material obligations on its part to be
fulfilled under or in connection with each Receivable and will do
Amended and Restated Pooling Agreement 60
nothing to impair the rights of the Holders in such Receivable.
(d) Inspection of Property; Books and Records; Discussions. Keep
proper books of records and account in which full, true and correct
entries in conformity with GAAP and all Requirements of Law shall be made
of all dealings and transactions in relation to its business and
activities; and permit representatives of the Trustee upon reasonable
advance notice to visit and inspect any of its properties and examine and
make abstracts from any of its books and records during normal business
hours on any Business Day and as often as may reasonably be requested,
subject to the Company's security and confidentiality requirements, and to
discuss the business, operations, properties and financial and other
condition of the Company with officers and employees of the Company and
with its Independent Public Accountants.
(e) Compliance with Law and Policies.
(i) Comply with all Requirements of Law, the provisions of the
Transaction Documents and all other material Contractual Obligations
applicable to the Company; and
(ii) Cause each of the Sellers to perform its respective
obligations in accordance and compliance with the Policies, as
amended from time to time in accordance with the Transaction
Documents, in regard to the Receivables and the Related Property.
(f) Purchase of Receivables. Purchase Receivables solely in
accordance with the Receivables Sale Agreement or this Agreement.
(g) Delivery of Collections. In the event that the Company receives
Collections directly from
Amended and Restated Pooling Agreement 61
Obligors, deliver (which may be by regular mail) or deposit such
Collections into a Lockbox, a Lockbox Account or the Collection Account
within two Business Days after its receipt thereof.
(h) Notices. Promptly (and, in any event, within two Business Days
after a Responsible Officer of the Company becomes aware of such event)
give written notice to the Trustee, each Rating Agency and each Agent for
any Outstanding Series of:
(i) the occurrence of any Early Amortization Event or
Potential Early Amortization Event; and
(ii) any Lien not permitted by subsection 2.08(c) on Receivables
accounting for 5% or more of the aggregate Principal Amount of all
Receivables in the Trust.
(i) Lockboxes. (i) Maintain, and keep in full force and effect, each
Lockbox Agreement to which the Company is a party, except to the extent
otherwise permitted under the terms of this Agreement and the other
Transaction Documents and (ii) take all reasonable actions necessary to
ensure that each related Lockbox Account shall be free and clear of, and
defend each such Lockbox Account against, any writ, order, stay, judgment,
warrant of attachment or execution or similar process; provided, however,
that, upon satisfaction of the Rating Agency Condition, the Company may
enter into any amendments or modifications of a Lockbox Agreement that the
Company reasonably deems necessary to conform such Lockbox Agreement to
the cash management system of the Company or the applicable Servicer or
Servicers.
(j) Separate Corporate Existence.
(i) Maintain its own deposit account or accounts, separate
from those of any Affiliate,
Amended and Restated Pooling Agreement 62
with commercial banking institutions and ensure that the funds of
the Company will not be diverted to any other Person or for other
than corporate uses of the Company, nor will such funds be
commingled with the funds of any Seller or any Subsidiary or
Affiliate of any Seller;
(ii) To the extent that it shares the same officers or other
employees as any of its stockholders or Affiliates, the salaries of
and the expenses related to providing benefits to such officers and
other employees shall be fairly allocated among such entities, and
each such entity shall bear its fair share of the salary and benefit
costs associated with all such common officers and employees;
(iii) To the extent that it jointly contracts with any of its
stockholders or Affiliates to do business with vendors or service
providers or to share overhead expenses, the costs incurred in so
doing shall be allocated fairly among such entities, and each such
entity shall bear its fair share of such costs. To the extent that
the Company contracts or does business with vendors or service
providers where the goods and services provided are partially for
the benefit of any other Person, the costs incurred in so doing
shall be fairly allocated to or among such entities for whose
benefit the goods or services are provided, and each such entity
shall bear its fair share of such costs. All material transactions
between the Company and any of its Affiliates, whether currently
existing or hereafter entered into, shall be only on an arm's length
basis;
(iv) Maintain office space separate from the office space of
each Seller and its Affiliates (but which may be located at the same
address as one of the Sellers or one of the Sellers'
Amended and Restated Pooling Agreement 63
Affiliates). To the extent that the Company and any of its
stockholders or Affiliates have offices in the same location, there
shall be a fair and appropriate allocation of overhead costs among
them, and each such entity shall bear its fair share of such
expenses;
(v) Issue separate financial statements prepared not less
frequently than quarterly and prepared in accordance with GAAP;
(vi) Conduct its affairs strictly in accordance with its
articles of incorporation and observe all necessary, appropriate and
customary corporate formalities, including, but not limited to,
holding all regular and special stockholders' and directors'
meetings appropriate to authorize all corporate action, keeping
separate and accurate minutes of its meetings, passing all
resolutions or consents necessary to authorize actions taken or to
be taken, and maintaining accurate and separate books, records and
accounts, including, but not limited to, payroll and intercompany
transaction accounts;
(vii) Not assume or guarantee any of the liabilities of any
Seller, any Servicer or any Affiliate thereof; and
(viii) Take, or refrain from taking, as the case may be, all
other actions that are necessary to be taken or not to be taken in
order to (x) ensure that the assumptions and factual recitations set
forth in the Specified Bankruptcy Opinion Provisions remain true and
correct with respect to the Company and (y) comply with those
procedures described in such provisions which are applicable to the
Company.
Amended and Restated Pooling Agreement 64
(k) Preservation of Corporate Existence. (i) Preserve and maintain
its corporate existence, rights, franchises and privileges in the
jurisdiction of its incorporation and (ii) qualify and remain qualified in
good standing as a foreign corporation in each jurisdiction where such
qualification is required other than any jurisdiction where the failure so
to qualify would not have a Company Material Adverse Effect.
(1) Assessments. Promptly pay and discharge all taxes, assessments,
levies and other governmental charges imposed on it except such taxes,
assessments, levies and other governmental charges that (i) are being
contested in good faith by appropriate proceedings and for which the
Company shall have set aside on its books adequate reserves and (ii) the
failure to pay, satisfy or discharge would not, in any event, result in a
Company Material Adverse Effect.
(m) Net Worth. On the Initial Closing Date have a consolidated
common stockholders' equity, and thereafter maintain at all times a net
worth, of at least $33,000,000.
SECTION 2.08. Negative Covenants of the Company. The Company hereby
covenants that, until the Trust Termination Date occurs, it shall not directly
or indirectly:
(a) Limitation on Liabilities. Create, incur, assume or suffer to
exist any Indebtedness, except Indebtedness evidenced by the Seller Note;
or incur any liability or obligation other than (i) liabilities or
obligations representing fees, expenses and indemnities payable pursuant
to and in accordance with the Transaction Documents and (ii) liabilities
or obligations for services supplied or furnished to the Company in an
amount not to exceed $50,000 at any time outstanding.
Amended and Restated Pooling Agreement 65
(b) Limitation on Transfers of Receivables, etc. At any time sell,
transfer or otherwise dispose of any of the Receivables, Related Property
or the proceeds thereof pursuant to
(i) any Lien Creation except for Permitted Liens; or
(ii) any Investment except in respect of or in connection with
(A) the purchase of Receivables and Related Property from the Seller
or its Subsidiaries, (B) an advance or loan made to a Seller or (C)
investments of proceeds as contemplated in any Pooling and Servicing
Agreement.
(c) Limitation on Guarantee Obligations. Become or remain liable,
directly or contingently, in connection with any Indebtedness or other
liability of any other Person, whether by guarantee, endorsement (other
than endorsements of negotiable instruments for deposit or collection in
the ordinary course of business), agreement to purchase or repurchase,
agreement to supply or advance funds, or otherwise other than under or in
connection with any Pooling and Servicing Agreement.
(d) Limitation on Fundamental Changes. Enter into any merger,
consolidation or amalgamation, or liquidate, wind up or dissolve itself
(or suffer any liquidation or dissolution), or make any material change in
its present method of conducting business, or convey, sell, lease, assign,
transfer or otherwise dispose of, all or substantially all of its
property, business or assets other than the assignments and transfers
contemplated hereby.
(e) Business of the Company. Engage at any time in any business or
business activity other than the acquisition of Receivables pursuant to
the Receivables
Amended and Restated Pooling Agreement 66
Sale Agreement, the assignments and transfers hereunder, the other
transactions contemplated by the Transaction Documents or any Pooling and
Servicing Agreement and the holding of the LHL Demand Note, and any
activity incidental to the foregoing and necessary or convenient to
accomplish the foregoing, or enter into or be a party to any agreement or
instrument other than in connection with the foregoing.
(f) Agreements. (i) Become a party to any indenture, mortgage,
instrument, contract, agreement, lease or other undertaking, except the
Transaction Documents, leases of office space, equipment or other
facilities for use by the Company in its ordinary course of business,
employment agreements, service agreements, agreements relating to shared
employees and the other Transaction Documents or any Pooling and Servicing
Agreement and agreements necessary to perform its obligations under the
Transaction Documents or any Pooling and Servicing Agreement, (ii) issue
any power of attorney (except to the Trustee, the Master Servicer or the
Servicers or except for the purpose of permitting any Person to perform
any ministerial functions on behalf of the Company that are not prohibited
by or inconsistent with the terms of the Transaction Documents or any
Pooling and Servicing Agreement), or (iii) amend, supplement, modify or
waive any of the provisions of the Receivables Sale Agreement or any
Lockbox Agreement or request, consent or agree to or suffer to exist or
permit any such amendment, supplement, modification or waiver or exercise
any consent rights granted to it thereunder unless such amendment,
supplement, modification or waiver or such exercise of consent rights
would not have an adverse effect on the interests, rights or remedies of
the Trustee or the Investor Certificateholders of any Outstanding Series
under or with respect to the Transaction Documents and the Rating Agency
Condition shall have been satisfied with respect to any such amendments,
supplements, modifications or waivers.
Amended and Restated Pooling Agreement 67
(g) Policies. Make any change or modification (or permit any change
or modification to be made) in any material respect to the Policies,
except (i) if such changes or modifications are necessary under any
Requirement of Law or (ii) if the Rating Agency Condition is satisfied
with respect thereto; provided, however, that if any change or
modification, other than a change or modification permitted pursuant to
clause (i) above, would be reasonably likely to have a Material Adverse
Effect on the interests of the Investor Certificateholders of a Series
which is not rated by a Rating Agency, the consent of the applicable Agent
(or if none, as specified in the related Supplement) shall be required to
effect such change or modification.
(h) Receivables Not To Be Evidenced by Promissory Notes. Subject to
the delivery requirement set forth in subsection 2.01(b), take any action
to cause any Receivable not evidenced by an "instrument" (as defined in
the UCC as in effect in any state in which the Company's, or the related
Sellers' chief executive offices or books and records relating to such
Receivable are located) upon origination to become evidenced by an
instrument, except in connection with its enforcement or collection of a
Defaulted Receivable.
(i) Offices. Move the location of its chief executive office or of
any of the offices where it keeps its records with respect to the
Receivables, or its legal head office to a new location within or outside
the state where such office is now located, without (i) 30 days prior
written notice to the Trustee and each Rating Agency and (ii) taking all
actions reasonably requested by the Trustee (including but not limited to
all filings and other acts necessary or advisable under the UCC or similar
statute of each relevant jurisdiction) in order to continue the Trust's
first priority perfected ownership or security interest
Amended and Restated Pooling Agreement 68
in all Receivables now owned or hereafter created; provided, however, that
the Company shall not change the location of its chief executive office to
a state which is within the Tenth Circuit unless it delivers an opinion of
counsel reasonably acceptable to the Rating Agencies to the effect that
Octagon Gas Systems, Inc. ▇. ▇▇▇▇▇▇, 995 F.2d 948 (10th Cir. 1993) is no
longer controlling precedent in the Tenth Circuit.
(j) Change in Name. Change its name, identity or corporate structure
in any manner that would or is likely (i) to make any financing statement
or continuation statement (or other similar instrument) relating to this
Agreement seriously misleading within the meaning of Section 9-402(7) of
the UCC, or (ii) to impair the perfection of the Trust's interest in any
Receivable under any other similar law, without 30 days prior written
notice to the Trustee and each Rating Agency.
(k) Charter. Amend or make any change or modification to its
certificate of incorporation without first satisfying the Rating Agency
Condition (other than an amendment, change or modification made pursuant
to changes in law of the state of its incorporation or amendments to
change the Company's name (subject to compliance with clause (k) above),
registered agent or address of registered office).
(l) Addition of Sellers. Agree to the addition of any additional
Seller pursuant to subsection 9.12 of the Receivables Sale Agreement
unless such additional Seller shall have been simultaneously added as a
Servicer party to the Servicing Agreement pursuant to Section 7.04 thereof
or another Servicer has simultaneously agreed to service the Receivables
originated by such additional Seller.
(m) Optional Termination of Seller. Designate any Seller as a Seller
to be terminated as a Seller
Amended and Restated Pooling Agreement 69
pursuant to subsection 9.13(b) of the Receivables Sale Agreement unless,
if such Seller is a Servicer, such Seller shall have been terminated as a
Servicer pursuant to Section 6.04 of the Servicing Agreement.
(n) Limitation on Restricted Payments and Payments on Seller Note.
Declare or pay any dividend on, or make any payment on account of, or set
apart assets for a sinking or other analogous fund for, the purchase,
redemption, defeasance, retirement or other acquisition of, any shares of
any class of capital stock of the Company, whether now or hereafter
outstanding, or make any other distribution in respect thereof, either
directly or indirectly, whether in cash or property or in obligations of
the Company (such declarations, payments, setting apart, purchases,
redemptions, defeasances, retirements, acquisitions and distributions
being herein called "Restricted Payments"), or make, directly or
indirectly, payments in any form in respect of the Seller Note except, in
either case, in accordance with the terms of any Pooling and Servicing
Agreement.
ARTICLE III
Rights of Holders and
Allocation and Application of Collections
THE FOLLOWING PORTION OF THIS ARTICLE III
IS APPLICABLE TO ALL SERIES.
SECTION 3.01. Establishment of Collection Account; Certain
Allocations. (a) The Trustee, for the benefit of the Holders, as their interests
appear in this Agreement, shall cause to be established and maintained in the
name of the Trust with an Eligible Institution or with the corporate trust
department of the Trustee or an Eligible Institution or an affiliate of the
Trustee or an Eligible Institution, a segregated trust account (the "Collection
Amended and Restated Pooling Agreement 70
Account"), bearing a designation clearly indicating that the funds deposited
therein are held for the benefit of the Holders. Schedule 2, which is hereby
incorporated into and made a part of this Agreement, identifies the Collection
Account by setting forth the account number of such account, the account
designation of such account and the name of the institution with which such
account has been established. The Collection Account shall be divided into
individual subaccounts for each Outstanding Series (each, respectively, a
"Series Collection Subaccount" and, collectively, the "Series Collection
Subaccounts") and for the Company (the "Company Collection Subaccount"). For
administrative purposes only, the Trustee shall establish or cause to be
established for each Series, so long as such Series is an Outstanding Series,
sub-subaccounts of the Series Collection Subaccounts with respect to such Series
(respectively, the "Series Principal Collection Sub-subaccount" and "Series
Non-Principal Collection Sub-subaccount" and, collectively, the "Series
Collection Sub-subaccounts").
(b) Authority of the Trustee in Respect of the Collection Account.
(i) 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 for the benefit of the Holders. If, at any time, the Master Servicer or
any Servicer has actual notice or knowledge that any institution holding the
Collection Account has ceased to be an Eligible Institution, any such Servicer
shall immediately notify the Master Servicer and the Master Servicer shall
direct the Trustee to establish within 30 days a substitute account therefor
with an Eligible Institution, transfer any cash and/or any Eligible Investments
to such new account and from the date any such substitute accounts are
established, such account shall be the Collection Account. Neither the Company,
the Master Servicer nor any Servicer, nor any person or entity claiming by,
through or under the Company, the Master Servicer or any Servicer, shall have
any right, title or interest in, except to the extent expressly
Amended and Restated Pooling Agreement 71
provided under the Transaction Documents, or any right to withdraw any amount
from, the Collection Account. Pursuant to the authority granted to the Servicers
in subsection 2.02(a) of the Servicing Agreement, each Servicer shall have the
power to instruct the Trustee in writing to make withdrawals from and payments
to the Collection Account for the purposes of carrying out the Master
Servicer's, the Servicers' or Trustee's duties hereunder.
(ii) The Master Servicer agrees to give written direction (which may
be included within any Daily Report) in a timely manner to the Trustee to apply
all Collections with respect to the Receivables and to make all other
applications, allocations and distributions described in Article III and in the
Supplement with respect to each Outstanding Series.
(iii) Each Series of Investor Certificates shall represent
Fractional Undivided Interests as indicated in the Supplement relating to such
Series and the right to receive Collections and other amounts at the times and
in the amounts specified in this Article III (as supplemented by the Supplement
related to such Series) to be deposited in the Collection Account and any other
accounts maintained for the benefit of the Investor Certificateholders or paid
to the Investor Certificateholders (with respect to each outstanding Series, the
"Investor Certificateholders' Interest"). The Exchangeable Company Interest
shall represent the interest in the Trust not represented by any Series of
Investor Certificates or Subordinated Company Interest then outstanding,
including the right to receive Collections and other amounts at the times and in
the amounts specified in this Article III to be paid to the Company (the
"Exchangeable Company Interest"), and each Subordinated Company Interest, if
any, shall represent the interests granted to such Subordinated Company Interest
pursuant to the related Supplement; provided, however, that no such Subordinated
Company Interest shall represent any interest in any Trust Account and any other
accounts maintained for the benefit of the Investor
Amended and Restated Pooling Agreement 72
Certificateholders, except as specifically provided in this Article III.
(c) Administration of the Collection Account. At the written
direction of the Company, funds on deposit in the Collection Account available
for investment, shall be invested by the Trustee in Eligible Investments
selected by the Company. All such Eligible Investments shall be held by the
Trustee for the benefit of the Investor Certificateholders. Amounts on deposit
in each Series Non-Principal Collection Sub-subaccount shall, if applicable, be
invested in Eligible Investments that will mature, or that are payable or
redeemable upon demand of the holder thereof, so that such funds will be
available on or before the Business Day immediately preceding the next
Distribution Date. None of such Eligible Investments shall be disposed of prior
to the maturity date with respect thereto unless such disposition is reasonably
determined by the Company to be necessary to prevent a loss. All interest and
investment earnings (net of losses and investment expenses) on funds deposited
in a Series Non-Principal Collection Sub-subaccount shall be deposited in such
sub-subaccount. Amounts on deposit in the Series Principal Collection Sub-
subaccount and any other sub-subaccounts as specified in the related Supplement
shall be invested in Eligible Investments that mature, or that are payable or
redeemable upon demand of the holder thereof, so that such funds will be
available not later than the date which is specified in any Supplement. The
Trustee, or its nominee or custodian, shall maintain possession of the
negotiable instruments or securities, if any, evidencing any Eligible
Investments from the time of purchase thereof until the time of sale or
maturity. Any earnings (net of losses and investment expenses) (the "Investment
Earnings") on such invested funds in a Series Principal Collection
Sub-subaccount and any other sub-subaccounts as specified in the related
Supplement will be deposited by the Trustee in the related Series Non-Principal
Collection Sub-subaccount.
Amended and Restated Pooling Agreement 73
(d) Daily Collections. (i) Promptly following its receipt of
Collections in the form of available funds in a Lockbox Account, but in no event
later than 1:30 p.m., New York City time, on the Business Day following the
Business Day Received, the related Servicer shall transfer, or cause to be
transferred, all Collections on deposit (less the aggregate amount of set-offs
permitted to be retained pursuant to any applicable Lockbox Agreement) in the
form of available funds in the Lockbox Accounts directly to the Collection
Account.
(ii) If the Aggregate Daily Collections are deposited into the
Collection Account pursuant to the preceding subsection 3.01(d)(i) at or before
1:00 p.m., New York City time, and the Daily Report specified in subsection
3.01(b)(ii) is received by the Trustee at or before 1:00 p.m., New York City
time, the Trustee shall transfer, within a reasonable time, on such Business
Day, from such Aggregate Daily Collections, to the respective Series Collection
Subaccount, an amount equal to the product of (x) the applicable Invested
Percentage for such Outstanding Series and (y) such Aggregate Daily Collections
in accordance with the Daily Report.
(iii) If the Aggregate Daily Collections are deposited into the
Collection Account at or before 1:00 p.m., New York City time, and the Daily
Report is received by the Trustee at or before 1:00 p.m., New York City time, as
set forth in the preceding subsection 3.01(d)(ii), the Trustee shall allocate,
within a reasonable time, on such Business Day, funds transferred to the Series
Collection Subaccount for each Outstanding Series pursuant to the preceding
subsection 3.01(d)(ii) to the Series Non-Principal Collection Sub-subaccount and
the Series Principal Collection Sub-subaccount of each such Series in accordance
with the Daily Report and the related Supplement for such Series.
(iv) Except as otherwise provided in a Supplement, if the Aggregate
Daily Collections are deposited into the
Amended and Restated Pooling Agreement 74
Collection Account at or before 1:00 p.m., New York City time, and the Daily
Report is received by the Trustee at or before 1:00 p.m., New York City time, as
set forth in subsection 3.01(d)(ii), the Trustee shall, in accordance with the
Daily Report, transfer, within a reasonable time, on such Business Day, to the
Company Collection Subaccount the remaining funds, if any, on deposit in the
Collection Account on such day after giving effect to transfers to be made
pursuant to subsection 3.01(d)(ii).
(e) Certain Allocations Following an Amortization Period. (i) If, on
any Settlement Report Date, an Amortization Period has occurred and is
continuing with respect to any Outstanding Series and at such Settlement Report
Date, a Revolving Period is still in effect with respect to any other
Outstanding Series (a "Special Allocation Settlement Report Date"), then the
Master Servicer shall make the following calculations:
(A) the amount (the "Allocable Charged-Off Amount") equal to the
excess, if any, of (I) the aggregate Principal Amount of
Charged-Off Receivables for the related Settlement Period over
(II) the aggregate Principal Amount of Recoveries received
during the related Settlement Period;
(B) the amount (the "Allocable Recoveries Amount") equal to the
excess, if any, of (I) the aggregate Principal Amount of
Recoveries received during the related Settlement Period over
(II) the aggregate Principal Amount of Charged-Off Receivables
for the related Settlement Period; and
(ii) If, on any Special Allocation Settlement Report Date, either of
the Allocable Charged-off Amount or the Allocable Recoveries Amount is greater
than zero for the related Settlement Period, the Trustee shall (in accordance
with written directions received pursuant to subsection (b)(ii) above) make (A)
a pro rata allocation to each Outstanding Series (based on the Invested
Percentage for such Series) of
Amended and Restated Pooling Agreement 75
a portion (as determined in clause (iii) below) of each such positive amount and
(B) an allocation to the Exchangeable Company Interest of the remaining portion
of each such positive amount.
(iii) With respect to each portion of the Allocable Charged-off
Amount and the Allocable Recoveries Amount which is allocated to an Outstanding
Series pursuant to subsection 3.01(e)(ii), the Trustee shall (in accordance with
the written direction of the Master Servicer) apply each such amount to such
Series in accordance with the related Supplement for such Series.
(f) Allocations for the Exchangeable Company Interest. Until the
occurrence and continuation of an Early Amortization Period, on each Business
Day and, after the occurrence and continuation of an Early Amortization Period
and until the Trust Termination Date, on each Distribution Date, after making
all allocations required pursuant to subsection 3.01(d), the Trustee shall (in
accordance with the written direction of the Master Servicer) transfer, using
its best efforts to transfer within two hours of receipt of the Aggregate Daily
Collections and the Daily Report and, if the Aggregate Daily Collections and the
Daily Report are received by the Trustee no later than 1:00 p.m., New York City
time, making such transfer no later than 3:00 p.m., New York City time, on such
Business Day, the amounts on deposit in the Company Collection Subaccount to the
holder of the Exchangeable Company Interest or to such accounts or such Persons
as the holder of the Exchangeable Company Interest may direct in writing (which
direction may consist of standing instructions provided by the holder of the
Exchangeable Company Interest that shall remain in effect until changed by the
holder of the Exchangeable Company Interest in writing); provided, however, that
a transfer for purposes of this subsection 3.01(f) shall be deemed to have
occurred at such time as the Trustee instructs the Federal Reserve Bank of New
York of the outgoing amount; provided further that a failure of the Trustee to
transfer funds by 3:00 p.m., New York City time,
Amended and Restated Pooling Agreement 76
shall not be a breach of this subsection 3.01(f) if (i) Chemlink or a similar
program is not used by both the Company and the Trustee to make such transfers
or (ii) a Trustee Force Majeure Delay occurs, and in either such event the
Trustee shall use its best efforts to transfer funds within a reasonable time.
(g) Setoff. In addition to the provisions of Section 8.05, (i) if
the Company shall fail to make a payment as provided in this Agreement or any
Supplement, the Master Servicer or the Trustee may set off and apply any amounts
otherwise payable to the Company under any Pooling and Servicing Agreement. The
Company hereby waives demand, notice or declaration of such setoff and
application; provided that notice will promptly be given to the Company of such
setoff and application; provided further that failure to give such notice shall
not affect the validity of such setoff; and (ii) in the event any Servicer shall
fail to make a payment as provided in any Pooling and Servicing Agreement, the
Trustee may set off and apply any amounts otherwise payable to such Servicer in
its capacity as Servicer under the Transaction Documents on account of such
obligation. Each Servicer hereby waives demand, notice or declaration of such
setoff and application; provided that notice will promptly be given to such
Servicer of such setoff; provided further that failure to give such notice shall
not affect the validity of such setoff.
(h) Allocation and Application of Funds. The Master Servicer shall
direct the Trustee in writing (which may be given in the form of the Daily
Reports and the Monthly Settlement Statements) to apply all Collections with
respect to the Receivables as described in this Article III and in the
Supplement with respect to each Outstanding Series. The Master Servicer shall
direct the Trustee in writing to pay Collections to the holder of the
Exchangeable Company Interest to the extent such Collections are allocated to
the Exchangeable Company Interest under subsection 3.01(f) and as otherwise
provided in Article III. Unless otherwise provided in one or more Supplement, if
the
Amended and Restated Pooling Agreement 77
Trustee receives any Daily Report at or before 1:00 p.m., New York City time, on
any Business Day, the Trustee shall make any applications of funds required
thereby on the same Business Day and otherwise on the next succeeding Business
Day.
THE REMAINDER OF ARTICLE III SHALL BE SPECIFIED
IN THE SUPPLEMENT WITH RESPECT TO EACH SERIES.
SUCH REMAINDER SHALL BE APPLICABLE ONLY TO THE
SERIES RELATING TO THE SUPPLEMENT IN WHICH
SUCH REMAINDER APPEARS.
ARTICLE IV
ARTICLE IV IS RESERVED
AND MAY BE SPECIFIED IN ANY SUPPLEMENT
WITH RESPECT TO THE SERIES RELATING THERETO.
ARTICLE V
The Investor Certificates and
Exchangeable Company Interest
SECTION 5.01. The Investor Certificates. The Investor Certificates
of each Series and any Class thereof shall be in fully registered form and shall
be substantially in the form of the exhibits with respect thereto attached to
the applicable Supplement. The Investor Certificates shall, upon issue, be
executed and delivered by the Company to the Trustee for authentication and
redelivery as provided in Section 5.02. Except as otherwise set forth as to any
Series or Class in the related Supplement, the Investor Certificates shall be
issued in minimum denominations of $500,000 and in integral multiples of
$100,000 in excess thereof. Unless otherwise specified in any Supplement for any
Series, the Investor Certificates shall be issued upon initial issuance as a
single global certificate in an
Amended and Restated Pooling Agreement 78
original principal amount equal to the Initial Invested Amount with respect to
such Series. The Company is hereby authorized to execute and deliver each
Investor Certificate and any documents related thereto on behalf of the Trust.
Each Investor Certificate shall be executed by manual or facsimile signature on
behalf of the Company by a Responsible Officer. Investor Certificates bearing
the manual or facsimile signature of the individual who was, at the time when
such signature was affixed, authorized to sign on behalf of the Company or the
Trustee shall not be rendered invalid, notwithstanding that such individual has
ceased to be so authorized prior to or on the date of the authentication and
delivery of such Investor Certificates or does not hold such office at the date
of such Investor Certificates. No Investor Certificate shall be entitled to any
benefit under this Agreement, or be valid for any purpose, unless there appears
on such Investor 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 of
authentication upon any Investor Certificate shall be conclusive evidence, and
the only evidence, that such Investor Certificate has been duly authenticated
and delivered hereunder. All Investor Certificates shall be dated the date of
their authentication but failure to do so shall not render them invalid.
SECTION 5.02. Authentication of Investor Certificates. The Trustee
shall authenticate and deliver the initial Series of Investor Certificates that
is issued upon the written order of the Company in a form reasonably
satisfactory to the Trustee, to the holders of the initial Series of Investor
Certificates, against payment to the Company of the Initial Invested Amount. The
Investor Certificates shall be duly authenticated by or on behalf of the Trustee
in authorized denominations equal to (in the aggregate) the Initial Invested
Amount. Upon a Company Exchange as provided in Section 5.10 and the satisfaction
of certain other conditions specified therein, the Trustee shall authenticate
and deliver the Investor Certificates of
Amended and Restated Pooling Agreement 79
additional Series (with the designation provided in the applicable Supplement)
(or, if provided in any Supplement, the additional Investor Certificates of an
existing Series), upon the written order of the Company, to the Persons
designated in such Supplement. Upon the written order of the Company, the
Investor Certificates of any Series shall be duly authenticated by or on behalf
of the Trustee, in authorized denominations equal to (in the aggregate) the
Initial Invested Amount of such Series of Investor Certificates.
SECTION 5.03. Registration of Transfer and Exchange of Investor
Certificates. (a) The Trustee shall cause to be kept at the office or agency to
be maintained by a transfer agent and registrar (which may be the Trustee) (the
"Transfer Agent and Registrar") in accordance with the provisions of Section
8.16 a register (the "Certificate Register") in which, subject to such
reasonable regulations as the Trustee may prescribe, the Transfer Agent and
Registrar shall provide for the registration of the Investor Certificates and of
transfers and exchanges of the Investor Certificates as herein provided. The
Company hereby appoints The Chase Manhattan Bank as Transfer Agent and Registrar
for the purpose of registering the Investor Certificates and transfers and
exchanges of the Investor Certificates as herein provided. The Chase Manhattan
Bank shall be permitted to resign as Transfer Agent and Registrar upon 30 days
prior written notice to the Company, the Trustee and the Master Servicer;
provided, however, that such resignation shall not be effective and The Chase
Manhattan Bank 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 Company and such successor Transfer Agent
and Registrar has accepted such appointment. The provisions of Sections 8.01,
8.02, 8.03, 8.05 and 10.19 shall apply to The Chase Manhattan Bank (or the
Trustee to the extent it is so acting) also in its role as Transfer Agent or
Registrar, as the case may be, for so long as The Chase Manhattan Bank
Amended and Restated Pooling Agreement 80
(or the Trustee to the extent it is so acting) shall act as Transfer Agent or
Registrar, as the case may be.
The Company hereby agrees to provide the Trustee from time to time
sufficient funds, on a timely basis and in accordance with and subject to
Section 8.05, for the payment of any reasonable compensation payable to the
Transfer Agent and Registrar for its services under this Section 5.03 and under
Section 5.10. The Trustee hereby agrees that, upon the receipt of such funds
from the Company, it shall pay the Transfer Agent and Registrar such amounts.
Upon surrender for registration of transfer of any Investor
Certificate at any office or agency of the Transfer Agent and Registrar
maintained for such purpose, the Company shall execute, and the Trustee shall,
upon the written order of the Company, authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Investor Certificates
in authorized denominations of the same Series representing like aggregate
Fractional Undivided Interests and which bear numbers that are not
contemporaneously outstanding.
At the option of an Investor Certificateholder, Investor
Certificates may be exchanged for other Investor Certificates of the same Series
in authorized denominations of like aggregate Fractional Undivided Interests,
bearing numbers that are not contemporaneously outstanding, upon surrender of
the Investor Certificates to be exchanged at any such office or agency of the
Transfer Agent and Registrar maintained for such purpose.
Whenever any Investor Certificates of any Series are so surrendered
for exchange, the Company shall execute, and the Trustee shall, upon the written
order of the Company, authenticate and (unless the Transfer Agent and Registrar
is different from the Trustee, in which case the Transfer Agent and Registrar
shall) deliver, the Investor Certificates of such Series which the Investor
Certificateholder making the exchange is entitled to
Amended and Restated Pooling Agreement 81
receive. Every Investor Certificate presented or surrendered for registration of
transfer or exchange shall be accompanied by a written instrument of transfer,
with sufficient instructions, duly executed by the Investor Certificateholder
thereof or his attorney-in-fact duly authorized in writing delivered to the
Trustee (unless the Transfer Agent and Registrar is different from the Trustee,
in which case to the Transfer Agent and Registrar) and complying with any
requirements set forth in the applicable Supplement.
No service charge shall be made for any registration of transfer or
exchange of Investor Certificates, but the Transfer Agent and Registrar may
require any Investor Certificateholder that is transferring or exchanging one or
more Investor Certificates to pay a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any transfer or
exchange of Investor Certificates.
All Investor Certificates surrendered for registration of transfer
and exchange shall be canceled and disposed of in a customary manner
satisfactory to the Trustee.
The Company shall execute and deliver Investor Certificates to the
Trustee or the Transfer Agent and Registrar in such amounts and at such times as
are necessary to enable the Trustee and the Transfer Agent and Registrar to
fulfill their respective responsibilities under this Agreement and the Investor
Certificates.
(b) The Transfer Agent and Registrar will maintain at its expense in
the Borough of Manhattan, The City of New York and, subject to subsection
5.03(a), if specified in the related Supplement for any Series, any other city
designated in such Supplement, an office or offices or agency or agencies where
Investor Certificates may be surrendered for registration or transfer or
exchange.
Amended and Restated Pooling Agreement 82
(c) Unless otherwise stated in any related Supplement, registration
of transfer of Investor Certificates containing a legend relating to
restrictions on transfer of such Investor Certificates (which legend shall be
set forth in the Supplement relating to such Investor Certificates) shall be
effected only if the conditions set forth in the related Supplement are complied
with.
Investor Certificates issued upon registration or transfer of, or in
exchange for, Investor Certificates bearing the legend referred to above shall
also bear such legend unless the Company, the Master 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.
SECTION 5.04. Mutilated, Destroyed, Lost or Stolen Investor
Certificates. If (a) any mutilated Investor Certificate 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 Investor
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 the
Trust, each of them and the Company harmless, then, in the absence of actual
notice to the Trustee or Transfer Agent and Registrar that such Investor
Certificate has been acquired by a bona fide purchaser, the Company shall
execute and, upon the written request of the Company, the Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Investor Certificate, a new Investor Certificate of
like tenor and aggregate Fractional Undivided Interest and bearing a number that
is not contemporaneously outstanding. In connection with the issuance of any new
Investor Certificate under this Section 5.04, the Trustee or the Transfer Agent
and Registrar may require the payment by the Investor Certificateholder of a sum
sufficient to cover any tax or other governmental expenses (including the fees
and expenses of the Trustee and Transfer Agent and Registrar) connected
Amended and Restated Pooling Agreement 83
therewith. Any duplicate Investor Certificate issued pursuant to this Section
5.04 shall constitute complete and indefeasible evidence of ownership in the
Trust, as if originally issued, whether or not the lost, stolen or destroyed
Investor Certificate shall be found at any time.
SECTION 5.05. Persons Deemed Owners. At all times prior to due
presentation of an Investor Certificate for registration of transfer, the
Company, the Trustee, the Paying Agent, the Transfer Agent and Registrar, any
Agent and any agent of any of them may treat the Person in whose name any
Investor Certificate is registered as the owner of such Investor Certificate for
the purpose of receiving distributions pursuant to Article IV of the related
Supplement and for all other purposes whatsoever, and neither the Trustee, 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
provisions of this Section 5.05, in determining whether the Investor
Certificateholders of the requisite Fractional Undivided Interests have given
any request, demand, authorization, direction, notice, consent or waiver
hereunder, Investor Certificates owned by the Company, the Master Servicer or
any Servicer or any Affiliate thereof, shall be disregarded and deemed not to be
outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Investor Certificates which a Responsible Officer of the
Trustee actually knows to be so owned shall be so disregarded. Investor
Certificates so owned by the Company, the Master Servicer or any Servicer or any
Affiliate thereof 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
Investor Certificates and that the pledgee is not the Company, the Master
Servicer or any Servicer or any Affiliate thereof.
Amended and Restated Pooling Agreement 84
SECTION 5.06. Appointment of Paying Agent. The Paying Agent shall
make distributions to Investor Certificateholders from the Collection Account
(and/or any other account or accounts maintained for the benefit of Investor
Certificateholders as specified in the related Supplement for any Series)
pursuant to Articles III and IV. 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
in any material respect. Unless otherwise specified in the related Supplement
for any Series and with respect to such Series, the Paying Agent shall initially
be The Chase Manhattan Bank and any co-paying agent chosen by The Chase
Manhattan Bank. Each Paying Agent shall have a combined capital and surplus of
at least $50,000,000. The Paying Agent shall be permitted to resign upon 30 days
prior written notice to the Trustee. In the event that the Paying Agent shall so
resign, the Trustee shall appoint a successor to act as Paying Agent (which
shall be a depositary institution or trust company) reasonably acceptable to the
Company which appointment shall be effective on the date on which the Person so
appointed gives the Trustee written notice that it accepts the appointment. Any
resignation or removal of the Paying Agent and appointment of successor Paying
Agent pursuant to this Section 5.06 shall not become effective until acceptance
of appointment by the successor Paying Agent, as provided in this Section 5.06.
The Trustee shall cause such successor Paying Agent or any additional Paying
Agent appointed by the Trustee to execute and deliver to the Trustee an
instrument in which such successor Paying Agent or additional Paying Agent shall
agree with the Trustee that as Paying Agent, such successor Paying Agent or
additional Paying Agent 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 of a Paying Agent such Paying Agent shall also
return all funds in its possession to the Trustee. The
Amended and Restated Pooling Agreement 85
provisions of Sections 8.01, 8.02, 8.03, 8.05 and 10.19 shall apply to The Chase
Manhattan Bank (or the Trustee to the extent it is so acting) also in its role
as Paying Agent, for so long as The Chase Manhattan Bank (or the Trustee to the
extent it is so acting) 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.
The Company hereby agrees to provide the Trustee from time to time
sufficient funds, on a timely basis and in accordance with and subject to
Section 8.05, for the payment of any reasonable compensation payable to the
Paying Agent for its services under this Section 5.06. The Trustee hereby agrees
that, upon the receipt of such funds from the Company, it shall pay the Paying
Agent such amounts.
SECTION 5.07. Access to List of Investor Certificateholders' Names
and Addresses. The Trustee will furnish or cause to be furnished by the Transfer
Agent and Registrar to the Company, the Master Servicer or the Paying Agent,
within 10 Business Days after receipt by the Trustee of a request therefor from
the Company, the Master Servicer or the Paying Agent, respectively, in writing,
a list of the names and addresses of the Investor Certificateholders as then
recorded by or on behalf of the Trustee. The costs and expenses incurred in
connection with the provision of such list shall constitute Program Costs under
the Supplement for the applicable Series. If three or more Investor
Certificateholders of record or any Investor Certificateholder of any Series or
a group of Investor Certificateholders of record representing Fractional
Undivided Interests aggregating not less than 10% of the Invested Amount of the
related Outstanding Series (the "Applicants") apply in writing to the Trustee,
and such application states that the Applicants desire to communicate with other
Investor Certificateholders of any Series with respect to their rights under
this Agreement or under the Investor Certificates and is accompanied by a copy
of the communication which such Applicants propose to transmit,
Amended and Restated Pooling Agreement 86
then the Trustee, after having been adequately indemnified by such Applicants
for its costs and expenses, shall transmit or shall cause the Transfer Agent and
Registrar to transmit, such communication to the Investor Certificateholders
reasonably promptly after the receipt of such application.
Every Investor Certificateholder, by receiving and holding an
Investor Certificate, agrees with the Trustee that neither the Trustee, the
Transfer Agent and Registrar, nor any of their respective agents, officers,
directors or employees shall be held accountable by reason of the disclosure or
mailing of any such information as to the names and addresses of the Investor
Certificateholders hereunder, regardless of the sources from which such
information was derived.
As soon as practicable following each Record Date, the Trustee shall
provide to the Paying Agent or its designee, a list of Investor
Certificateholders in such form as the Paying Agent may reasonably request.
SECTION 5.08. Authenticating Agent. (a) The Trustee may appoint one
or more authenticating agents with respect to the Investor Certificates which
shall be authorized to act on behalf of the Trustee in authenticating the
Investor Certificates in connection with the issuance, delivery, registration of
transfer, exchange or repayment of the Investor Certificates. Whenever reference
is made in this Agreement to the authentication of Investor 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 a certificate of authentication executed on behalf of the Trustee by
an authenticating agent.
(b) Any institution succeeding to the corporate trust business of an
authenticating agent shall continue to be an authenticating agent without the
execution or filing
Amended and Restated Pooling Agreement 87
of any paper or any further act on the part of the Trustee or such
authenticating agent.
(c) An authenticating agent may at any time resign by giving written
notice of resignation to the Trustee. Upon the receipt by the Trustee of any
such notice of resignation and upon the giving of any such notice of termination
by the Trustee, the Trustee shall immediately give notice of such resignation or
termination to the Company. Any resignation of an authenticating agent shall not
become effective until acceptance of appointment by the successor authenticating
agent as provided in this Section 5.08. The Trustee may at any time terminate
the agency of an authenticating agent by giving notice of termination to such
authenticating agent. 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, 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
of its predecessor hereunder, with like effect as if originally named as an
authenticating agent. No successor authenticating agent (other than an Affiliate
of the Trustee) shall be appointed unless reasonably acceptable to the Trustee
and the Company.
(d) The Company hereby agrees to provide the Trustee from time to
time sufficient funds, on a timely basis and in accordance with and subject to
Section 8.05, for the payment of any reasonable compensation payable to each
authenticating agent for its services under this Section 5.08. The Trustee
hereby agrees that, upon the receipt of such funds from the Company it shall pay
each authenticating agent such amounts.
(e) The provisions of Sections 8.01, 8.02, 8.03 and 8.05 shall be
applicable to any authenticating agent.
Amended and Restated Pooling Agreement 88
(f) Pursuant to an appointment made under this Section 5.08, the
Investor Certificates may have endorsed thereon, in lieu of the Trustee's
certificate of authentication, an alternate certificate of authentication in
substantially the following form:
"This is one of the Investor Certificates described in the Amended
and Restated Pooling Agreement dated as of February 4, 1997, among LFI
Receivables Corporation, LFI Servicing Corporation, as Master Servicer and
The Chase Manhattan Bank, as Trustee.
THE CHASE MANHATTAN BANK
as Authenticating Agent
for the Trustee
By____________________________
Authorized Signatory
SECTION 5.09. Tax Treatment. It is the intent of the Master
Servicer, the Servicers, the Company, the Investor Certificateholders and the
Trustee that, under applicable U.S. Federal, state and local income and
franchise tax laws, the Investor Certificates will qualify as indebtedness of
the Company secured by the Trust Assets and the Trust will not be characterized
as an association or publicly traded partnership taxable as a corporation. The
Company and the Trustee, by entering into this Agreement, and each Investor
Certificateholder, by its acceptance of its Investor Certificate, agree to treat
the Investor Certificates for applicable U.S. Federal, state and local income
and franchise tax purposes as indebtedness of the Company. The provisions of
this Agreement and all related Transaction Documents shall be construed to
further these intentions of the parties. This Section 5.09 shall survive
Amended and Restated Pooling Agreement 89
the termination of this Agreement and shall be binding on all transferees of any
of the foregoing persons.
SECTION 5.10. Exchangeable Company Interest. (a) The Company may
decrease the amount of the Exchangeable Company Interest in exchange for (i) an
increase in the Invested Amount of a Class of Investor Certificates of an
Outstanding Series and an increase in any related Subordinated Company Interest
in connection with an issuance of additional Investor Certificates of such
Outstanding Series or (ii) one or more newly issued Series of Investor
Certificates and any related newly issued Subordinated Company Interest (any
such decrease a "Company Exchange"). (A Company Exchange shall not be necessary
in connection with an increase in the Invested Amount of any Investor
Certificates issued in a Series with an Invested Amount that may increase or
decrease from time to time. Such Investor Certificates are expected to be
designated as "Variable Funding Certificates" or "VFC Certificates".) The
Company may perform a Company Exchange by notifying the Trustee, in writing at
least three days in advance (an "Exchange Notice") of the date upon which the
Company Exchange is to occur (an "Exchange Date"). Any Exchange Notice shall
state the designation of any Series to be issued on the Exchange Date and, with
respect to each such Series: (a) its additional or Initial Invested Amount, as
the case may be, if any, which in the aggregate at any time may not be greater
than the current principal amount of the Exchangeable Company Interest, if any,
at such time and (b) its Certificate Rate (or the method for allocating interest
payments or other cash flow to such Series), if any. On the Exchange Date, the
Trustee shall only (i) authenticate and deliver any Investor Certificates
evidencing an increase in the Invested Amount of a Class of Investor
Certificates or a newly issued Series and (ii) permit the issuance of any
related Subordinated Company Interest, upon delivery by the Company to the
Trustee of the following (together with the delivery by the Company to the
Trustee of any additional agreements, instruments or other documents as are
specified in the related Supplement):
Amended and Restated Pooling Agreement 90
(a) a Supplement executed by the Company and specifying the Principal Terms of
such Series (provided that no such Supplement shall be required for any increase
in the Invested Amount of a Class of Investor Certificates, and any related
increase in the related Subordinated Company Interest, unless it is so required
by the related Supplement), (b) a Tax Opinion addressed to the Trustee and the
Trust, (c) a General Opinion addressed to the Trustee and the Trust, (d) an
Officer's Certificate certifying that all conditions precedent to the
authentication and delivery of such Investor Certificates have been satisfied
and upon which Officer's Certificate the Trustee may conclusively rely, (e)
written confirmation from each Rating Agency that the Company Exchange will not
result in the Rating Agency's reducing or withdrawing its rating on any then
Outstanding Series or any Class of any such Outstanding Series rated by it, (f)
written instructions of an officer of the Company specifying the amount, Series,
Investor Certificates and other Interests to be issued with respect to such
Company Exchange and (g) the applicable Investor Certificates if necessary. Upon
delivery of the items listed in clauses (a) through (g) above, the Trustee shall
cancel the applicable tendered Investor Certificates and Subordinated Company
Interest, as the case may be, and issue, as provided above, such Series of
Investor Certificates and allow the issuance of such Subordinated Company
Interest, if applicable, dated the Exchange Date. The Trustee shall cause to be
kept at the office or agency to be maintained by the Transfer Agent and
Registrar in accordance with the provisions of Section 8.16 a register (the
"Exchange Register") in which, subject to such reasonable regulations as the
Trustee may prescribe, the Transfer Agent and Registrar shall record all Company
Exchanges and the amount of the Exchangeable Company Interest following any such
Company Exchange. There is no limit to the number of Company Exchanges that the
Company may perform under this Agreement. If the Company shall, on any Exchange
Date, retain any Investor Certificates issued on such Exchange Date, it shall,
prior to transferring any such Investor Certificates to another Person, obtain a
Tax
Amended and Restated Pooling Agreement 91
Opinion. Additional restrictions relating to a Company Exchange may be set forth
in any Supplement.
(b) Upon any Company Exchange, the Trustee, in accordance with the
written directions of the Company, shall issue to the Company under Section
5.01, for execution and redelivery to the Trustee for authentication under
Section 5.02, (i) one or more Investor Certificates representing an increase in
the Invested Amount of an Outstanding Series, or (ii) one or more new Series of
Investor Certificates. Any such Investor Certificates shall be substantially in
the form specified in the applicable Supplement and each shall bear, upon its
face, the designation for such Series to which each such certificate belongs so
selected by the Company.
(c) In conjunction with a Company Exchange, the parties hereto
shall, except as otherwise provided in subsection (a) above, execute a
supplement to this Agreement, which shall define, with respect to any additional
Investor Certificates or newly issued Series, as the case may be: (i) its name
or designation, (ii) its additional or initial principal amount, as the case may
be, (or method for calculating such amount), (iii) its coupon rate (or formula
for the determination thereof), (iv) the interest payment date or dates and the
date or dates from which interest shall accrue, (v) the method for allocating
Collections to Holders, (vi) the names of any accounts to be used by such Series
and the terms governing the operation of any such accounts, (vii) the issue and
terms of a letter of credit or other form of Enhancement, if any, with respect
thereto, (viii) the terms on which the certificates of such Series may be
repurchased by the Company or may be remarketed to other investors, (viii) the
Series Termination Date, (ix) any deposit account maintained for the benefit of
Holders, (x) the number of classes of such Series, and if more than one class,
the rights and priorities of each such class, (xi) the rights of the holder of
the Exchangeable Company Interest that have been transferred to the holders of
such Series, (xii) the designation of any Series Accounts
Amended and Restated Pooling Agreement 92
and the terms governing the operation of any such Series Accounts, (xiii)
provisions acceptable to the Trustee concerning the payment of the Trustee's
fees and expenses and (xiv) other relevant terms (all such terms, the "Principal
Terms" of such Series). The Supplement executed in connection with the Company
Exchange shall contain administrative provisions which are reasonably acceptable
to the Trustee.
(d) The Company shall not transfer, assign, exchange or otherwise
dispose of the Exchangeable Company Interest or any Subordinated Company
Interest without (i) the prior satisfaction of the Rating Agency Condition and
(ii) delivery of a Tax Opinion. If the Company shall transfer, assign, exchange
or otherwise dispose of all or any portion of the Exchangeable Company Interest
or any Subordinated Company Interest, in accordance with the preceding sentence,
the Transfer Agent and Registrar shall record the transfer, assignment, exchange
or other disposition of (i) the Exchangeable Company Interest in the Exchange
Register and (ii) any Subordinated Company Interest in a register maintained by
the Transfer Agent and Registrar at its office or agency (the "Subordinated
Interest Register"). Any Holder who wishes to transfer, assign, exchange or
otherwise dispose of all or any portion of the Exchangeable Company Interest or
any Subordinated Company Interest held by it shall deliver instructions and a
written instrument of transfer, with sufficient instructions, duly executed by
the Holder or his attorney-in-fact duly authorized in writing delivered to the
Trustee (unless the Transfer Agent and Registrar is different from the Trustee,
in which case to the Transfer Agent and Registrar) and complying with any
requirements set forth in the applicable Supplement. No service charge shall be
made for any registration of transfer or exchange of all or any portion of the
Exchangeable Company Interest or any Subordinated Company Interest, but the
Transfer Agent and Registrar may require any Holder that is transferring or
exchanging all or any portion of the Exchangeable Company Interest or any
Subordinated Company Interest to pay a sum sufficient to
Amended and Restated Pooling Agreement 93
cover any tax or governmental charge that may be imposed in connection with any
transfer or exchange of all or any portion of the Exchangeable Company Interest
or the Subordinated Company Interest.
(e) Except as specified in any Supplement for a related Series, all
Investor Certificates of any Series shall be equally and ratably entitled as
provided herein to the benefits hereof without preference, priority or
distinction on account of the actual time or times of authentication and
delivery, all in accordance with the terms and provisions of this Agreement and
the applicable Supplement.
SECTION 5.11. Book-Entry Certificates. If specified in any related
Supplement, the Investor Certificates, or any portion thereof, 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
depository specified in such Supplement (the "Depository") which shall be the
Clearing Agency, specified by, or on behalf of, the Company for such Series. The
Investor Certificates shall initially be registered on the Certificate Register
in the name of the nominee of such Clearing Agency, and no Certificate
Book-Entry Holder will receive a definitive certificate representing such
Certificate Book-Entry Holder's interest in the Investor Certificates, except as
provided in Section 5.13. Unless and until definitive, fully registered Investor
Certificates ("Definitive Certificates") have been issued to Investor
Certificateholders pursuant to Section 5.13 or the related Supplement:
(a) the provisions of this Section 5.11 shall be in full force and
effect;
(b) the Company, the Master Servicer, the Servicers and the Trustee
may deal with each Clearing Agency for all purposes (including the making
of
Amended and Restated Pooling Agreement 94
distributions on the Investor Certificates) as the Investor
Certificateholder without respect to whether there has been any actual
authorization of such actions by the Certificate Book-Entry Holders with
respect to such actions;
(c) to the extent that the provisions of this Section 5.11 conflict
with any other provisions of this Agreement, the provisions of this
Section 5.11 shall control; and
(d) the rights of Certificate Book-Entry Holders shall be exercised
only through the Clearing Agency and the related Clearing Agency
Participants and shall be limited to those established by law and
agreements between such related Certificate Book-Entry Holders and the
Clearing Agency and/or the Clearing Agency Participants. Pursuant to the
Depository Agreement, the initial Clearing Agency will make book-entry
transfers among the Clearing Agency Participants and receive and transmit
distributions of principal and interest on the Investor Certificates to
such Clearing Agency Participants.
Notwithstanding the foregoing, no Class or Series of Investor
Certificates may be issued as Book-Entry Certificates (but, instead, shall be
issued as Definitive Certificates) unless at the time of issuance of such Class
or Series, the Company and the Trustee receive an opinion of independent counsel
that the Investor Certificates of such Class or Series will be treated as
indebtedness for Federal income tax purposes.
SECTION 5.12. Notices to Clearing Agency. Whenever notice or other
communication to the Investor Certificateholders is required under this
Agreement, unless and until Definitive Certificates shall have been issued to
Certificate Book-Entry Holders pursuant to Section 5.13, the Trustee shall give
all such notices and communications
Amended and Restated Pooling Agreement 95
specified herein to be given to the Investor Certificateholders to the Clearing
Agencies.
SECTION 5.13. Definitive Certificates. If (a) (i) the Company
advises the Trustee in writing that any Clearing Agency is no longer willing or
able to properly discharge its responsibilities under the applicable Depository
Agreement, and (ii) the Company is unable to locate a qualified successor, (b)
the Company, at its option, advises the Trustee in writing that it elects to
terminate the book-entry system through the Clearing Agency or (c) after the
occurrence of a Servicer Default, Certificate Book-Entry Holders representing
Fractional Undivided Interests aggregating more than 50% of the Invested Amount
held by such Certificate Book-Entry Holders of each affected Series then issued
and outstanding advise the Clearing Agency through the Clearing Agency
Participants in writing, and the Clearing Agency shall so notify the Trustee,
that the continuation of a book-entry system through the Clearing Agency is no
longer in the best interests of the Certificate Book-Entry Holders, the Trustee
shall notify the Clearing Agency, which shall be responsible to notify the
Certificate Book-Entry Holders, of the occurrence of any such event and of the
availability of Definitive Certificates to Certificate Book-Entry Holders
requesting the same. Upon surrender to the Trustee of the Book-Entry
Certificates by the Clearing Agency, accompanied by registration instructions
from the Clearing Agency for registration, the Trustee shall issue the
Definitive Certificates. Neither the Company 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.
Amended and Restated Pooling Agreement 96
ARTICLE VI
Other Matters Relating to the Company
SECTION 6.01. Liability of the Company. The Company shall be liable
for all obligations, covenants, representations and warranties of the Company
arising under or related to this Agreement or any Supplement. Except as provided
in the preceding sentence and otherwise herein, the Company shall be liable only
to the extent of the obligations specifically undertaken by it in its capacity
as Company hereunder.
SECTION 6.02. Limitation on Liability of the Company. Subject to
Sections 6.01 and 10.19, neither the Company nor any of its directors or
officers or employees or agents shall be under any liability to the Trust, the
Trustee, the Holders or any other Person for any action taken or for refraining
from the taking of any action pursuant to this Agreement whether or not such
action or inaction arises from express or implied duties under any Transaction
Document; provided, however, that this provision shall not protect the Company
against any liability which would otherwise be imposed by reason of wilful
misconduct, bad faith or negligence in the performance of any duties or by
reason of reckless disregard of any obligations and duties hereunder. The
Company and any director or officer or employee or agent of the Company may rely
in good faith on any document of any kind prima facie properly executed and
submitted by any Person (other than, in the case of the Company, the Company or
any Servicer) respecting any matters arising hereunder.
ARTICLE VII
Early Amortization Events
SECTION 7.01. Early Amortization Events. Unless modified with
respect to any Series of Investor Certificates
Amended and Restated Pooling Agreement 97
by any related Supplement, if any one of the following events (each, an "Early
Amortization Event") shall occur:
(a) (i) a court having jurisdiction in the premises shall enter a
decree or order for relief in respect of the Company in an involuntary
case under the Bankruptcy Code or any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect (the Bankruptcy Code and all
other such applicable laws being collectively, "Applicable Insolvency
Laws"), which decree or order is not stayed or any other similar relief
shall be granted under any applicable federal or state law now or
hereafter in effect and shall not be stayed; (ii) (A) an involuntary case
is commenced against the Company under any Applicable Insolvency Law now
or hereafter in effect, a decree or order of a court having jurisdiction
in the premises for the appointment of a receiver, liquidator,
sequestrator, trustee, custodian or other officer having similar powers
over the Company, or over all or a substantial part of the property of the
Company shall have been entered, an interim receiver, trustee or other
custodian of the Company for all or a substantial part of the property of
the Company is involuntarily appointed, a warrant of attachment, execution
or similar process is issued against any substantial part of the property
of the Company, and (B) any event referred to in clause (ii)(A) above
continues for 60 days unless dismissed, bonded or discharged; (iii) the
Company shall at its request have a decree or an order for relief entered
with respect to it or commence a voluntary case under any Applicable
Insolvency Law, consent to the entry of a decree or an order for relief in
an involuntary case, or to the conversion of an involuntary case to a
voluntary case, under any Applicable Insolvency Law, consent to the
appointment of or taking possession by a receiver, trustee or other
custodian for all or a substantial part of its property; (iv) the making
by the Company of any general assignment for the benefit of creditors;
Amended and Restated Pooling Agreement 98
(v) the inability or failure of the Company generally to pay its debts as
such debts become due; or (vi) the Board of Directors of the Company
adopts any resolution or otherwise authorizes action to approve any of the
foregoing;
(b) the Trust or the Company shall become an "investment company"
within the meaning of the 1940 Act;
(c) the Trust shall receive a written notice from the Internal
Revenue Service taking the position that the Trust should be characterized
for United States federal income tax purposes as a "publicly traded
partnership" or as an association taxable as a corporation and counsel to
the Company cannot provide an opinion that such claim is without merit; or
(d) the Trustee shall be appointed Successor Master Servicer or
Successor Servicer pursuant to the Servicing Agreement;
then, an "Early Amortization Period" with respect to all Outstanding Series
shall commence without any notice or other action on the part of the Trustee or
any Investor Certificateholder immediately upon the occurrence of such event.
The Master Servicer shall notify each Rating Agency and the Trustee in writing
of the occurrence of any Early Amortization Period. Upon the commencement
against the Company of a case, proceeding or other action described in clause
(a)(ii) above, the Company shall cease to purchase Receivables from any Seller
and cease to transfer Receivables to the Trust, until such time, if any, as such
case, proceeding or other action is vacated, discharged, or stayed or bonded
pending appeal. If an Insolvency Event with respect to the Company occurs, the
Company shall immediately cease to transfer Receivables to the Trust (or, if the
Company has previously suspended the transfer of Receivables to the Trust to
comply with the preceding sentence, such suspension shall become a permanent
cessation
Amended and Restated Pooling Agreement 99
of the transfer of Receivables to the Trust) and shall promptly give written
notice to the Trustee of such occurrence. Notwithstanding any cessation of the
transfer to the Trust of additional Receivables, Receivables transferred to the
Trust prior to the occurrence of such Insolvency Event and Collections in
respect of such Receivables and interest, whenever created, accrued in respect
of such Receivables, shall continue to be a part of the Trust.
Additional Early Amortization Events and the consequences thereof
may be set forth in each Supplement with respect to the Series relating thereto.
SECTION 7.02. Additional Rights upon the Occurrence of Certain
Events. (a) After the appointment of the Trustee as Successor Master Servicer or
Successor Servicer pursuant to the Servicing Agreement, the Trustee shall
proceed to sell, dispose of, or otherwise liquidate the Receivables in a
commercially reasonable manner and on commercially reasonable terms, which shall
include the solicitation of competitive bids and the Trustee shall proceed to
consummate the sale, liquidation or disposition of the Receivables as provided
above with the highest bidder for the Receivables. The Company or any of its
Affiliates shall be permitted to bid for the Receivables. In addition, the
Company or any of its Affiliates shall have the right to match any bid by a
third person and be granted the right to purchase the Receivables at such
matched bid price. The provisions of Sections 7.01 and 7.02 shall be cumulative.
All reasonable costs and expenses incurred by the Trustee in such sale shall be
reimbursable to the Trustee as provided in Section 8.05.
(b) The proceeds from the sale, disposition or liquidation of the
Receivables pursuant to subsection (a) above shall be treated as Collections on
the Receivables and such proceeds shall be released to the Trustee in an amount
equal to the amount of any expenses incurred by the Trustee acting in its
capacity either as Trustee or as liquidating
Amended and Restated Pooling Agreement 100
agent under this Section 7.02 that have not otherwise been reimbursed and the
remainder, if any, will be distributed to holders of each Series after
immediately being deposited in the Collection Account, in accordance with the
provisions of Section 3.01(e) and the related Supplement for such Series. After
giving effect to all such distributions, the remainder, if any, shall be
allocated to the Exchangeable Company Interest and shall be released to the
holders of the Exchangeable Company Interest pro-rata based on the amount of the
Exchangeable Company Interest held by each holder thereof.
ARTICLE VIII
The Trustee
SECTION 8.01. Duties of Trustee. (a) The Trustee, prior to the
occurrence of a Servicer Default or Early Amortization Event of which a
Responsible Officer of the Trustee has actual knowledge and after the curing of
all Servicer Defaults and Early Amortization Events which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in the Pooling and Servicing Agreements or any Supplement and no implied
covenants or obligations shall be read into such Pooling and Servicing
Agreements against the Trustee. If a Servicer Default or Early Amortization
Event of which a Responsible Officer of the Trustee has actual knowledge
occurred (which has not been cured or waived), the Trustee shall exercise the
rights and powers vested in it by any Pooling and Servicing Agreement or any
Supplement and shall use the same degree of care and skill in their exercise as
a prudent person would exercise or use under the circumstances in the conduct of
such person's own affairs.
(b) The Trustee may conclusively rely as to the truth of the
statements and the correctness of the opinions expressed therein upon
resolutions, certificates, statements, opinions, reports, documents, orders or
other
Amended and Restated Pooling Agreement 101
instruments furnished to the Trustee; provided, that (i) in the case of any of
the above which are specifically required to be furnished to the Trustee
pursuant to any provision of the Pooling and Servicing Agreements, the Trustee
shall, subject to Section 8.02, examine them to determine whether they appear on
their face to conform to the requirements of this Agreement and (ii) in the case
of any of the above as to which the Trustee is required to perform procedures
pursuant to the Internal Operating Procedures Memorandum, the Trustee shall
perform said procedures in accordance with the Internal Operating Procedures
Memorandum.
(c) Subject to subsection 8.01(a), no provision of this Agreement or
any Supplement shall be construed to relieve the Trustee from liability for its
own grossly negligent action, its own grossly negligent failure to act or its
own wilful misconduct; provided, however, that:
(i) the Trustee shall not be liable for an error of judgment unless
it shall be proved that the Trustee was grossly negligent, or acted in bad
faith, in ascertaining the pertinent facts;
(ii) the Trustee shall not be liable with respect to any action
taken, suffered or omitted to be taken by it in good faith;
(iii) the Trustee shall not be charged with knowledge of any failure
by the Master Servicer or any Servicers to comply with any of their
obligations, unless a Responsible Officer of the Trustee obtains actual
knowledge of such failure or the Trustee receives written notice of such
failure from the Master Servicer or any Servicer, any Agent or any
Investor Certificateholder;
(iv) the Trustee shall not be charged with knowledge of a Servicer
Default or Early Amortization Event unless a Responsible Officer of the
Trustee obtains actual knowledge of such event or the Trustee
Amended and Restated Pooling Agreement 102
receives written notice of such default or event from the Master Servicer
or any Servicer, any Agent or any holder of Investor Certificates;
(v) the Trustee shall not be liable for any investment losses
resulting from any investments of funds on deposit in the Accounts or any
subaccounts thereof (provided that such investments are Eligible
Investments); and
(vi) the Trustee shall have no duty to monitor the performance of
the Master Servicer or any Servicer, nor shall it have any liability in
connection with malfeasance or nonfeasance by the Master Servicer or any
Servicer; the Trustee shall have no liability in connection with
compliance of the Master Servicer or any Servicer or the Company with
statutory or regulatory requirements related to the Receivables; and the
Trustee shall have no duty to perform, except as otherwise required
pursuant to the Internal Operating Procedures Memorandum, any
recalculation or verification of any calculation with respect to data
provided to the Trustee by the Master Servicer or any Servicer.
(d) The Trustee shall not be required to expend or risk its own
funds or otherwise incur any financial liability in the performance of any of
its duties under any Pooling and Servicing Agreement or in the exercise of any
of its rights or powers, 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 any
Pooling and Servicing Agreement shall in any event require the Trustee to
perform, or be responsible for the manner of performance of, any obligations of
the Master Servicer or any Servicer under such 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,
Amended and Restated Pooling Agreement 103
the Master Servicer or any Servicer in accordance with the terms of such
Agreement.
(e) The Trustee shall not be required to advance its own funds in
the performance of any of its duties under any Pooling and Servicing Agreement
or the exercise of any of its rights or powers.
(f) Except as expressly provided in any Pooling and Servicing
Agreement, the Trustee shall have no power to vary the corpus of the Trust.
(g) Provided that the Master Servicer or any Servicer and the
Company shall have provided to the Trustee promptly upon request all books,
records and other information reasonably requested by the Trustee and shall have
provided the Trustee with all necessary access to the properties, books and
records of the Master Servicer or any Servicer and the Company which the Trustee
may reasonably require, then within 90 days following the Initial Closing Date,
the Trustee shall have (i) completed the Servicer Site Review and (ii)
established the Standby Liquidation System, and shall have notified the Master
Servicer or any Servicer, each Rating Agency and each Investor Certificateholder
of such events.
(h) The Trustee shall prepare, within 45 days of the Initial Closing
Date, the Internal Operating Procedures Memorandum. Once prepared, the Trustee
shall take such actions as are set forth in the Internal Operating Procedures
Memorandum unless prevented from doing so through
no fault of the Trustee.
SECTION 8.02. Rights of the Trustee. Except as otherwise provided in
Section 8.01 and in the Internal Operating Procedures Memorandum:
(a) The Trustee may conclusively rely on and shall be protected in
acting on, or in refraining from acting in accord with, any resolution,
Officers
Amended and Restated Pooling Agreement 104
Certificate, certificate of auditors or any other certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
appraisal, bond, note or other paper or document believed by it to be
genuine and to have been signed or presented to it pursuant to any Pooling
and Servicing Agreement by the proper party or parties.
(b) The Trustee may consult with counsel and any Opinion of Counsel
and any advice of such 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 Opinion of Counsel.
(c) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by any Pooling and Servicing Agreement, or
to institute, conduct or defend any litigation hereunder or in relation
hereto, at the request, order or direction of any of the Holders, pursuant
to the provisions of any Pooling and Servicing Agreement, unless such
Holders shall have offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which may be incurred therein
or thereby; provided, however, that nothing contained herein shall relieve
the Trustee of the obligations, upon the occurrence of a Servicer Default
or Early Amortization Event (which has not been cured), to exercise such
of the rights and powers vested in it by any Pooling and Servicing
Agreement, and to use the same degree of care and skill in their exercise
as a prudent person would exercise or use under the circumstances in the
conduct of such person's own affairs. The right of the Trustee to perform
any discretionary act enumerated in this Agreement shall not be construed
as a duty, and the Trustee shall not be answerable for other than its
gross negligence or wilful misconduct in the performance of any such act.
Amended and Restated Pooling Agreement 105
(d) 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 any Pooling and Servicing Agreement; provided that the Trustee shall be
liable for its gross negligence or wilful misconduct.
(e) 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, direction, order,
approval, bond, note or other paper or document, unless requested in
writing so to do by the holders of Investor Certificates evidencing
Fractional Undivided Interests aggregating more than 50% of the Invested
Amount of any Series which could be materially and adversely affected if
the Trustee does not perform such acts; provided, however, that such
holders of Investor Certificates shall indemnify and reimburse the Trustee
for any liability or expense resulting from any such investigation
requested by them; provided further that the Trustee shall be entitled to
make such further inquiry or investigation into such facts or matters as
it may reasonably see fit, and if the Trustee shall determine to make such
further inquiry or investigation, it shall be entitled to examine the
books and records of the Company, personally or by agent or attorney, at
the sole cost and expense of the Company.
(f) The Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through affiliates,
agents or attorneys or a custodian or nominee, and the Trustee shall not
be responsible for any misconduct or negligence on the part of, or for the
supervision of, any such affiliate, agent, attorney, custodian or nominee
appointed with due care by it hereunder.
Amended and Restated Pooling Agreement 106
(g) 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 defects, the compliance by the Company with its
representations and warranties or for any other purpose.
(h) In the event that the Trustee is also acting as Paying Agent or
Transfer Agent and Registrar hereunder, the rights and protections
afforded to the Trustee pursuant to this Article VIII shall also be
afforded to such Paying Agent or Transfer Agent and
Registrar.
SECTION 8.03. Trustee Not Liable for Recitals. The Trustee assumes
no responsibility for the correctness of the recitals contained herein and in
the Investor Certificates (other than the certificate of authentication on the
Investor Certificates). Except as set forth in Section 8.15, the Trustee makes
no representations as to the validity or sufficiency of any Pooling and
Servicing Agreement, of the Investor Certificates (other than the certificate of
authentication on the Investor Certificates), of the Exchangeable Company
Interest, of any Subordinated Company Interest, of any Receivable or related
document or interest. The Trustee shall not be accountable for the use or
application by the Company of any of the Investor Certificates, any Subordinated
Company Interest or the Exchangeable Company Interest or of the proceeds of such
Investor Certificates, such Subordinated Company Interest or the Exchangeable
Company Interest or for the use or application of any funds paid to the Company
in respect of the Receivables or deposited in or withdrawn from the Accounts or
other accounts hereafter established to effectuate the transactions contemplated
herein and in accordance with the terms of any Pooling and Servicing Agreement.
Amended and Restated Pooling Agreement 107
The Trustee shall not be accountable for the use or application by
the Master Servicer or any Servicer of any of the Investor Certificates or of
the proceeds of such Investor Certificates, or for the use or application of any
funds paid to the Master Servicer or any Servicer in respect of the Receivables
or deposited in or withdrawn from the Accounts or any Lockbox by or at the
direction of the Servicers or Lockbox Processors. The Trustee shall at no time
have any responsibility or liability for or with respect to the legality,
validity and enforceability of any Receivable.
SECTION 8.04. Trustee May Own Investor Certificates. The Trustee in
its individual or any other capacity (a) may become the owner or pledgee of
Investor Certificates with the same rights as it would have if it were not the
Trustee and (b) may transact any banking and trust business with the Company,
the Master Servicer or any Servicer or the Sellers as it would were it not the
Trustee.
SECTION 8.05. Trustee's Fees and Expenses. The Master Servicer and
each Servicer covenant and agree to pay, but only from funds available to them
as the Servicing Fee paid under the Servicing Agreement, to the Trustee annually
in advance on the Initial Closing Date and on or about each one year anniversary
thereof, and the Trustee shall be entitled to receive, such reasonable
compensation as is agreed upon in writing between the Trustee and the Company
(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. The Trustee shall be
entitled to reimbursement upon its request for all reasonable expenses
(including, without limitation, expenses incurred in connection with notices,
requests for documentation or other communications to Holders), disbursements,
losses, liabilities, damages and advances incurred or made by the Trustee in
accordance with any of the provisions of any Pooling and Servicing Agreement or
by
Amended and Restated Pooling Agreement 108
reason of its status as Trustee under any Pooling and Servicing Agreement
(including the reasonable fees and expenses of its agents, any co-trustee and
counsel) except any such expense, disbursement, loss, liability, damage or
advance as may arise from its gross negligence or bad faith. To the extent the
fees and expenses of the Trustee are not paid on a current basis, the Trustee
shall be entitled to be paid such items from amounts that would be distributable
to the Company under Article III of this Agreement and, to the extent still
unpaid in full, the Company will pay or reimburse the Trustee upon its request
for such items. Notwithstanding anything contained in this Agreement to the
contrary, the Trustee shall not be entitled to reimbursement for any costs or
expenses incurred in connection with the review, negotiation, preparation,
execution and delivery of any of the Transaction Documents or in connection with
the issuance of any Investor Certificates on the Initial Closing Date except for
such costs and expenses as have been agreed to in writing between the Trustee
and Company. If the Trustee is appointed Successor Master Servicer or a
Successor Servicer in accordance with the Servicing Agreement, the provisions of
this Section 8.05 shall not apply to expenses, disbursements, losses,
liabilities, damages and advances made or incurred by the Trustee in its
capacity as Successor Master Servicer or a Successor Servicer, which items shall
be paid, first, out of the Servicing Fee, second, from amounts which would be
distributable to the Company under Article III of this Agreement, third, from
amounts distributable to the Company pursuant to Section 9.04 and fourth, to the
extent still unpaid in full, the Company will pay or reimburse the Trustee upon
its request for such items. The provisions of this Section 8.05 shall apply to
the reasonable expenses, disbursements and advances made or incurred by the
Trustee, or any other Person, in its capacity as liquidating agent, to the
extent not otherwise paid. The covenants to pay the expenses, disbursements,
losses, liabilities, damages and advances provided for in this Section shall
survive the termination of any Pooling and Servicing Agreement and shall be
binding on the Company, the Master Servicer, the
Amended and Restated Pooling Agreement 109
Servicers and any Successor Master Servicer or Successor Servicer. The
Company's, the Master Servicer's and the Servicers' covenants and agreements
contained in this Section 8.05 shall survive the termination of this Agreement.
SECTION 8.06. Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be 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 (or having a holding
company parent with) a combined capital and surplus of at least $50,000,000 and
subject to supervision or examination by federal or state authority. If such
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 8.06, the combined capital and surplus of such
corporation shall be deemed to 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 8.06, the Trustee shall resign immediately in the manner and with the
effect specified in Section 8.07.
SECTION 8.07. Resignation or Removal of Trustee. (a) Subject to
paragraph (c) below, the Trustee may at any time resign and be discharged from
the trust hereby created by giving written notice thereof to the Company, the
Master Servicer and the Rating Agencies. Upon receiving such notice of
resignation, the Company 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 such appointment 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.
Amended and Restated Pooling Agreement 110
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 8.06 hereof and shall fail to resign
after written request therefor by the Master Servicer, or if at any time the
Trustee shall be legally unable to act, or shall be adjudged a bankrupt or
insolvent, or if 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, then the Company may 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
successor trustee pursuant to any of the provisions of this Section 8.07 shall
not become effective until acceptance of appointment by the successor trustee as
provided in Section 8.08.
(d) The obligations of the Company described in Section 8.05 hereof
and the obligations of the Master Servicer described in Section 8.05 hereof and
Section 5.01 of the Servicing Agreement shall survive the removal or resignation
of the Trustee as provided in this Agreement.
(e) No Trustee under this Agreement shall be personally liable for
any action or omission of any successor trustee.
SECTION 8.08. Successor Trustee. (a) Any successor trustee appointed
as provided in Section 8.07 shall execute, acknowledge and deliver to the
Company 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,
Amended and Restated Pooling Agreement 111
with like effect as if originally named as Trustee herein. The predecessor
Trustee shall deliver to the successor trustee all documents or copies thereof,
at the expense of the Master Servicer, and statements held by it hereunder; and
the Company 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,
power, duties and obligations. The Master Servicer shall immediately give
notice, but in no event less than 10 days prior to any such resignation or
removal, to each Rating Agency upon the appointment of a successor trustee.
(b) No successor trustee shall accept appointment as provided in
this Section 8.08 unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 8.06.
(c) Upon acceptance of appointment by a successor trustee as
provided in this Section 8.08, such successor trustee shall mail notice of such
succession hereunder to all Holders at their addresses as shown in the
Certificate Register, the Exchange Register or the Subordinated Interest
Register, as applicable.
SECTION 8.09. 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 8.06, 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. The Trustee shall promptly give notice (except to the
extent prohibited under any Requirement of Law or Contractual Obligation), but
in no event less than 10 days prior to any such merger or consolidation, to the
Company, the Master
Amended and Restated Pooling Agreement 112
Servicer and the Rating Agencies upon any such merger or consolidation of the
Trustee. Information as to such merger or consolidation that is made publicly
available by the Trustee in at least two Authorized Newspapers shall be deemed
to satisfy the notice requirement of this Section 8.09.
SECTION 8.10. Appointment of Co-Trustee or Separate Trustee. (a)
Notwithstanding any other provisions of any Pooling and Servicing 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 Holders, such title to
the Trust, or any part thereof, and, subject to the other provisions of this
Section 8.10, such powers, duties, obligations, rights and trusts as the Trustee
may consider necessary. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
8.06 and no notice to Holders of the appointment of any co-trustee or separate
trustee shall be required under Section 8.08. The Trustee shall promptly notify
each Rating Agency of the appointment of any co-trustee.
(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 statute of any jurisdiction in
Amended and Restated Pooling Agreement 113
which any particular act or acts are to be performed (whether as Trustee
hereunder or as successor to the Master 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.
(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 VIII. 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 any Pooling and Servicing Agreement, specifically including every provision
of any Pooling and Servicing 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 Master Servicer
and the Company.
(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
Amended and Restated Pooling Agreement 114
by law, to do any lawful act under or in respect to any Pooling and Servicing
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 8.11. Tax Returns. In the event the Trust shall be required
to file U.S. Federal, state, local or foreign income tax returns, the Company
shall prepare and file or shall cause to be prepared and filed any such tax
returns required to be filed by the Trust and shall remit such tax returns to
the Trustee for signature at least five Business Days before such tax returns
are due to be filed (including extensions). The Company shall also prepare or
shall cause to be prepared all U.S. Federal tax information in connection with
this Agreement required by law to be distributed to Holders and shall deliver
such information to the Trustee at least five Business Days prior to the date it
is required by law to be distributed to the Holders. The Trustee, upon request,
will furnish the Company with all such information known to the Trustee as may
be reasonably determined by the Company to be required in connection with the
preparation of all U.S. Federal, state, local or foreign income tax returns of
the Trust, and shall, upon the Company's written request, execute such tax
returns. In no event shall the Trustee in its individual capacity be liable for
any liabilities, costs or expenses of the Trust, the Holders, the Company the
Master Servicer, or the Servicers arising under any U.S. Federal, state, local
or foreign income tax law or regulation, including, without limitation, excise
taxes or any other tax imposed by a Governmental Authority on or measured by
income (or any interest or penalty with respect thereto or arising from any
failure to comply therewith). The Trustee shall not be required to determine
whether any filing of tax returns is required.
Amended and Restated Pooling Agreement 115
SECTION 8.12. Trustee May Enforce Claims Without Possession of
Investor Certificates. All rights of action and claims under any Pooling and
Servicing Agreement or the Investor Certificates may be prosecuted and enforced
by the Trustee without the possession of any of the Investor 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 Investor Certificateholders in
respect of which such judgment has been obtained.
SECTION 8.13. Suits for Enforcement. If a Servicer Default shall
occur and be continuing, the Trustee may, as provided in Section 6.01 of the
Servicing Agreement, proceed to protect and enforce its rights and the rights of
the Holders under this Agreement or any other Transaction Document by suit,
action or proceeding (including any suit, action or proceeding on behalf of the
Holders against any third party) in equity or at law or otherwise, whether for
the specific performance of any covenant or agreement contained in this
Agreement or any other Transaction Document or in aid of the execution of any
power granted in this Agreement or any other Transaction Document 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 Holders. In furtherance of and without limiting the
generality of subsection 8.01(d), the Trustee shall have the right to obtain,
before initiating any such action, such reasonable indemnity from the Investor
Certificateholders as the Trustee may require against the costs, expenses and
liabilities that may be incurred therein or thereby. Nothing herein contained
shall be deemed to authorize the Trustee to authorize or consent to or accept or
adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Investor Certificates, the Subordinated
Company Interests or
Amended and Restated Pooling Agreement 116
the Exchangeable Company Interest or the rights of any holder thereof, or
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.
SECTION 8.14. Rights of Investor Certificateholders To Direct
Trustee. Investor Certificateholders evidencing more than 50% of the Invested
Amount of any Series affected by the conduct of any proceeding or the exercise
of any right conferred on the Trustee 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; provided,
however, that nothing in any Pooling and Servicing 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 of the Investor Certificateholders;
provided further in furtherance and without limiting the generality of
subsection 8.01(d), the Trustee shall have the right to obtain, before acting in
accordance with any such direction of the Investor Certificateholders, such
reasonable indemnity from the Investor Certificateholders as the Trustee may
require against the costs, expenses and liabilities that may be incurred in so
acting.
SECTION 8.15. Representations and Warranties of Trustee. The Trustee
represents and warrants that:
(a) the Trustee is a banking corporation organized, existing and in
good standing under the laws of the State of New York and is duly
authorized to exercise trust powers under applicable law;
(b) the Trustee has the power and authority to enter into this
Agreement and any Supplement, and has taken all necessary action to
authorize the execution, delivery and performance by it of this Agreement
and any Supplement; and
Amended and Restated Pooling Agreement 117
(c) each Pooling and Servicing Agreement and each of the Transaction
Documents executed by it have been duly executed and delivered by the
Trustee and, in the case of all such Transaction Documents, are legal,
valid and binding obligations of the Trustee, enforceable in accordance
with their respective 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 generally and except as such enforceability may be
limited by general principles of equity (whether considered in a suit at
law or in equity).
SECTION 8.16. Maintenance of Office or Agency. The Trustee will
maintain at its expense in the Borough of Manhattan, The City of New York, an
office or offices or agency or agencies where notices and demands to or upon the
Trustee in respect of the Investor Certificates or any other Interests and the
Pooling and Servicing Agreements may be served. The Trustee will give prompt
written notice to the Company, the Master Servicer and the Holders of any change
in the location of the Certificate Register, the Exchange Register, the
Subordinated Interest Register or any such office or agency.
SECTION 8.17. Limitation of Liability. The Investor Certificates are
executed by the Trustee, not in its individual capacity but solely as Trustee of
the Trust, in the exercise of the powers and authority conferred and vested in
it by the Trust Agreement. Each of the undertaking and agreements made on the
part of the Trustee in the Investor Certificates is made and intended not as a
personal undertaking or agreement by the Trustee but is made and intended for
the purpose of binding only the Trust.
Amended and Restated Pooling Agreement 118
ARTICLE IX
Termination
SECTION 9.01. Termination of Trust. (a) The Trust and the respective
obligations and responsibilities of the Company, the Servicers and the Trustee
created hereby (other than the obligation of the Trustee to make payments to
Holders as hereafter set forth) shall terminate, except with respect to any such
obligations or responsibilities expressly stated to survive such termination, on
the earliest of (i) the last day of the July 2011 Settlement Period, (ii) at the
option of the Company, at any time when the Aggregate Invested Amount is zero,
(iii) following the occurrence of any of the Early Amortization Events specified
in Section 7.01 of this Agreement, at any time when the Aggregate Invested
Amount is zero and (iv) upon completion of distribution of the amounts referred
to in subsection 7.02(b) (the "Trust Termination Date").
(b) If on the Distribution Date in the month immediately preceding
the month in which the Trust Termination Date occurs (after giving effect to all
transfers, withdrawals, deposits and drawings to occur on such date and the
payment of principal on any Series of Investor Certificates to be made on the
related Distribution Date pursuant to Article III) the Invested Amount of any
Series would be greater than zero (as certified in writing by the Master
Servicer), the Trustee, at the written direction of the Master Servicer, shall
make reasonable efforts to sell within 30 days of such Distribution Date all of
the Receivables. The proceeds of such sale shall be treated as Collections on
the Receivables and shall be allocated in accordance with Article III. During
such 30-day period, the Servicers shall continue to collect Collections on the
Receivables and allocate Collections in accordance with the provisions of
Article III. The reasonable costs and expenses incurred by the Trustee in such
sale shall be reimbursable to the Trustee as provided in Section 8.05.
Amended and Restated Pooling Agreement 119
SECTION 9.02. Optional Purchase and Final Termination Date of
Investor Certificates of Any Series. (a) On any Distribution Date during the
Amortization Period with respect to any Series on which the Invested Amount (or
such other amount as may be set forth in the related Supplement) of such Series
is reduced to an amount equal to or less than the Optional Repurchase Percentage
of the Initial Invested Amount (or such other amount as may be set forth in the
related Supplement) for such Series as of the day preceding the beginning of
such Amortization Period, the Company shall have the option to repurchase the
entire Investor Certificateholders' Interest of such Series, at a purchase price
equal to (i) the outstanding Invested Amount of the Investor Certificates of
such Series plus (ii) accrued and unpaid interest through such Distribution Date
(after giving effect to any payment of principal and monthly interest on such
date of purchase) plus (iii) all other amounts payable to all Investor
Certificateholders of such Series under the related Supplement (such purchase
price, the "Clean-Up Call Repurchase Price"). The amount of the Clean-Up Call
Repurchase Price will be deposited into the Collection Account for credit to the
Series Collection Subaccount for such Series on such Distribution Date in
immediately available funds and will be passed through in full to the applicable
Investor Certificateholders. Following any such repurchase, such Investor
Certificateholders' Interest in the Receivables shall terminate and such
interest therein will be allocated to the Exchangeable Company Interest and such
Investor Certificateholders will have no further rights with respect thereto. In
the event that the Company fails for any reason to deposit the Clean-Up Call
Repurchase Price for such Receivables, the Investor Certificateholders' Interest
in the Receivables will continue and monthly payments will continue to be made
to the Investor Certificateholders.
(b) The amount deposited pursuant to subsection 9.02(a) shall be
paid to the Investor Certificateholders of the related Series pursuant to
Article III on the Distribution Date following the date of
Amended and Restated Pooling Agreement 120
such deposit. All Investor Certificates of a Series which are purchased by the
Company pursuant to subsection 9.02(a) shall be delivered by the Company upon
such purchase to, and be canceled by (in accordance with the written directions
of the Company), the Transfer Agent and Registrar and be disposed of in a manner
satisfactory to the Trustee and the Company.
(c) All principal or interest with respect to any Series of Investor
Certificates shall be due and payable no later than the Series Termination Date
with respect to such Series. Unless otherwise provided in a Supplement, in the
event that the Invested Amount of any Series of Investor Certificates is greater
than zero on its Series Termination Date (after giving effect to all transfers,
withdrawals, deposits and drawings to occur on such date and the payment of
principal to be made on such Series on such date), the Trustee will sell or
cause to be sold, in accordance with the directions of 50% of the Investor
Certificateholders of such Series (upon which the Trustee may conclusively rely)
and pay the proceeds to all Investor Certificateholders of such Series pro rata
(except that unless expressly provided to the contrary in the related
Supplement, no payment shall be made to Investor Certificateholders of any Class
of any Series that is by its terms subordinated to any other Class until such
senior Class of Investor Certificates have been paid in full) in final payment
of all principal of and accrued interest on such Series of Investor
Certificates, an amount of Receivables or interests in Receivables up to the
Invested Amount of such Series at the close of business on such date; provided,
however, in furtherance and without limiting the generality of subsection
8.01(d), the Trustee shall have the right to obtain, before acting in accordance
with any such direction of the Investor Certificateholders, such reasonable
indemnity from the Investor Certificateholders as the Trustee may require
against the costs, expenses and liabilities that may be incurred in so acting.
Absent such direction from Investor Certificateholders representing more than
50% of the Invested Amount of such Series or absent such reasonable
Amended and Restated Pooling Agreement 121
indemnity as the Trustee may require in connection with such direction, the
Trustee shall continue to hold the Trust Assets in respect of such Series in
accordance with the terms of the Pooling and Servicing Agreements until the
Trust Termination Date (or until a majority of the Investor Certificateholders
shall otherwise direct the Trustee); provided that the terms of this Agreement,
the related Supplement and the Servicing Agreement shall be deemed to remain in
full force and effect, except that no additional Receivables shall be allocated
with respect to such Series. The reasonable costs and expenses incurred by the
Trustee in such sale shall be reimbursable to the Trustee as provided in Section
8.05. Any proceeds of such sale in excess of such principal and interest paid
shall be paid to the holder of the Exchangeable Company Interest, unless and to
the extent otherwise specified in any applicable Supplement. Upon such Series
Termination Date with respect to the applicable Series, final payment of all
amounts allocable to any Investor Certificates of such Series shall be made in
the manner provided in this Section 9.02.
SECTION 9.03. Final Payment with Respect to Any Series. (a) Written
notice of any termination, specifying the Distribution Date upon which the
Investor Certificateholders of any Series may surrender their Investor
Certificates for payment of the final distribution with respect to such series
and cancelation, shall be given (subject to at least 30 days prior written
notice from the Master Servicer to the Trustee containing all information
required for the Trustee's notice or such shorter period as is acceptable to the
Trustee) by the Trustee to Investor Certificateholders of such Series mailed not
later than the fifth day of the month of such final distribution specifying (i)
the Distribution Date upon which final payment of the Investor Certificates will
be made upon presentation and surrender of Investor Certificates 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 Distribution Date is not
applicable, payments being made only upon presentation and surrender of the
Investor
Amended and Restated Pooling Agreement 122
Certificates at the office or offices therein specified. The Master Servicer's
notice to the Trustee in accordance with the preceding sentence shall be
accompanied by an Officer's Certificate setting forth the information specified
in Section 4.04 of the Servicing Agreement covering the period during the then
current calendar year through the date of such notice. The Trustee shall give
such notice to the Transfer Agent and Registrar and the Paying Agent at the time
such notice is given to such Investor Certificateholders.
(b) Notwithstanding the termination of the Trust pursuant to
subsection 9.01(a) or the occurrence of the Series Termination Date with respect
to any Series pursuant to Section 9.02, all funds then on deposit in the
Collection Account (but only to the extent necessary to pay all outstanding and
unpaid amounts to Holders) shall continue to be held in trust for the benefit of
the Holders and the Paying Agent or the Trustee shall pay such funds to the
Investor Certificateholders upon surrender of their Investor Certificates in
accordance with the terms hereof. Any Investor Certificate not surrendered on
the date specified in subsection 9.03(a)(i) shall cease to accrue any interest
provided for such Investor Certificate from and after such date. In the event
that all of the Investor Certificateholders shall not surrender their Investor
Certificates for cancelation within six months after the date specified in the
above-mentioned written notice, the Trustee shall give a second written notice
to the remaining Investor Certificateholders of such Series to surrender their
Investor Certificates for cancelation and receive the final distribution with
respect thereto. If within one year after the second notice all the Investor
Certificates of such Series 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 Investor Certificateholders of such Series
concerning surrender of their Investor Certificates, and the cost thereof shall
be paid out of the funds in the Collection Account held for the benefit of such
Investor
Amended and Restated Pooling Agreement 123
Certificateholders. The Trustee and the Paying Agent shall pay to the Company
upon request any monies held by them for the payment of principal or interest
that remains unclaimed for two years and neither the Trustee nor the Paying
Agent shall be liable to any Investor Certificateholder for such payment to the
Company upon its request. After payment to the Company, Holders entitled to the
money must look to the Company for payment as general creditors unless an
applicable abandoned property law designates another Person.
(c) All Investor Certificates surrendered for payment of the final
distribution with respect to such Investor Certificates and cancelation shall be
canceled by the Transfer Agent and Registrar and be disposed of in a customary
manner satisfactory to the Trustee.
SECTION 9.04. Company's Termination Rights. Upon the termination of
the Trust pursuant to Section 9.01 and payment to the Trustee (in its capacity
as such and/or in its capacity as Successor Master Servicer) of all amounts owed
to it under any Pooling and Servicing Agreement, the Trustee shall assign and
convey to the Company (without recourse, representation or warranty) in exchange
for the Exchangeable Company Interest all right, title and interest of the Trust
in the Trust Assets, whether then existing or thereafter created, and all
proceeds thereof except for amounts held by the Trustee pursuant to subsection
9.03(b). The Trustee shall execute and deliver such instruments of transfer and
assignment, in each case without recourse, representation or warranty, as shall
be reasonably requested by the Company to vest in the Company all right, title
and interest which the Trust had in the Trust Assets.
ARTICLE X
Miscellaneous Provisions
SECTION 10.01. Amendment. (a) This Agreement, the Servicing
Agreement and each Supplement in respect of an
Amended and Restated Pooling Agreement 124
Outstanding Series (collectively, the "Pooling and Servicing Agreements") may be
amended in writing from time to time by the Master Servicer, the Company and the
Trustee, without the consent of any Holder, to cure any ambiguity, to correct or
supplement any provisions herein or therein which may be inconsistent with any
other provisions herein or therein or to add any other provisions hereof to
change in any manner or eliminate any of the provisions with respect to matters
or questions raised under any Pooling and Servicing Agreement which shall not be
inconsistent with the provisions of any Pooling and Servicing Agreement;
provided, however, that such action shall not, as evidenced by an Officer's
Certificate delivered to the Trustee, have a Material Adverse Effect or a
Company Material Adverse Effect (but, to the extent that the determination of
whether such action would have a Material Adverse Effect or a Company Material
Adverse Effect requires a conclusion as to a question of law, an Opinion of
Counsel shall be delivered to the Trustee in addition to such Officer's
Certificate); provided further any amendment that is entered into to provide
additional Enhancement for any Outstanding Series shall be deemed to have no
Material Adverse Effect or Company Material Adverse Effect. The Trustee may, but
shall not be obligated to, enter into any such amendment pursuant to this
paragraph or paragraph (b) below which affects the Trustee's rights, duties or
immunities under any Pooling and Servicing Agreement or otherwise.
(b) Any Pooling and Servicing Agreement and, to the extent provided
in any Pooling and Servicing Agreement, any other agreement relating to the
Receivables may also be amended (other than in the circumstances referred to in
the preceding paragraph (a)) in writing from time to time by the Master
Servicer, the Company and the Trustee with the consent of Investor
Certificateholders evidencing more than 50% of the Invested Amount of any Series
adversely affected in any material respect by the amendment (or, if any such
Series shall have more than one Class of Investor Certificates adversely
affected in any material respect by the amendment, more than 50% of the Invested
Amount of each
Amended and Restated Pooling Agreement 125
such Class) for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of such Pooling and Servicing
Agreement or such other agreement or of modifying in any manner the rights of
holders of any Series then issued and outstanding; provided, however, that no
such amendment shall (i) reduce in any manner the amount of, or delay the timing
of, distributions which are required to be made on any Investor Certificate of
such Series without the consent of such Investor Certificateholder of such
Series; (ii) change the definition of or the manner of calculating the interest
of any Investor Certificateholder of such Series without the consent of such
Investor Certificateholder; or (iii) reduce the aforesaid percentage of the
Invested Amount of any adversely affected Series or Class the holders of which
are required to consent to any such amendment without the consent of all
Investor Certificateholders of each Series adversely affected in any material
respect.
(c) Notwithstanding anything in this Section 10.01 to the contrary,
the Supplement with respect to any Series may be amended on the terms and with
the procedures provided in such Supplement.
(d) Promptly after the execution of any such amendment or consent,
the Trustee shall furnish written notification of the substance of such
amendment to each Investor Certificateholder of each Outstanding Series (or with
respect to an amendment of a Supplement, to each Investor Certificateholder of
the applicable Series), and the Master Servicer shall furnish written
notification of the substance of such amendment to each Rating Agency. No such
amendment (including without limitation, the amendment of any Supplement
notwithstanding anything to the contrary contained in any Supplement) shall be
effective until the Rating Agency Condition has been satisfied.
(e) It shall not be necessary for the consent of Investor
Certificateholders under this Section 10.01 to approve the particular form of
any proposed amendment, but
Amended and Restated Pooling Agreement 126
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.
(f) In executing or accepting any amendment pursuant to this Section
10.01, the Trustee shall, upon request, be entitled to receive and rely upon (i)
an Opinion of Counsel stating that such amendment is authorized pursuant to a
specific provision of a Pooling and Servicing Agreement and complies with such
provision, (ii) a certificate from a Responsible Officer of the Company stating
that such (A) amendment shall not adversely affect the interests of the holders
of any outstanding Investor Certificates in any material respect except for
holders of the Series whose consent to such amendment has been obtained in
accordance with clause (b) of this Section 10.01 and (B) all conditions
precedent to the execution and delivery of such amendment shall have been
satisfied in full and (iii) a Tax Opinion.
SECTION 10.02. Protection of Right, Title and Interest to Trust. The
Company shall cause each Pooling and Servicing Agreement, all amendments thereto
and/or all financing statements and continuation statements and any other
necessary documents covering the Holders' and the Trustee's right, title and
interest to the Trust 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 Trustee hereunder to all property comprising the Trust. The
Company shall deliver to the Trustee 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. In the event that the Company
fails to file such financing or continuation statements and the Trustee has
received an opinion of counsel, at the expense of the Company, that such filing
is
Amended and Restated Pooling Agreement 127
necessary to fully to preserve and to protect the Trustee's right, title and
interest in any Trust Asset then the Trustee shall have the right to file the
same on behalf of the Company and the Trustee shall be reimbursed and
indemnified by the Company for making such filing.
SECTION 10.03. Limitation on Rights of Holders. (a) The death or
incapacity of any Holder shall not operate to terminate this Agreement or the
Trust, nor shall such death or incapacity entitle such Holders' 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) Except with respect to the Investor Certificateholders as
expressly provided in any Pooling and Servicing Agreement, no Holder shall have
any right to vote or in any manner otherwise control the operation and
management of the Trust, or the obligations of the parties hereto. Nor shall any
Holder 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 Holder 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 Holder previously
shall have given to the Trustee, written request 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 its receipt of such notice, request and offer of indemnity, shall have
neglected or refused to initiate any such action, suit or proceeding; it being
understood and intended, and being expressly covenanted by each Holder with
every other Holder and the Trustee, that no one or more Holder shall have any
Amended and Restated Pooling Agreement 128
right in any manner whatever by virtue or by availing itself or themselves of
any provisions of the Pooling and Servicing Agreements to affect, disturb or
prejudice the rights of any other of the Interests, or to obtain or seek to
obtain priority over or preference to any other such Holder, or to enforce any
right under this Agreement, except in the manner herein provided and for the
equal, ratable and common benefit of all Holders. For the protection and
enforcement of the provisions of this Section 10.03, each and every Holder and
the Trustee shall be entitled to such relief as can be given either at law or in
equity.
(d) By their acceptance of Interests pursuant to this Agreement and
the applicable Supplement, the Holders agree to the provisions of this Section
10.03.
SECTION 10.04. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT
REFERENCE TO ANY CONFLICTS OF LAWS PRINCIPLES, EXCEPT TO THE EXTENT THAT ISSUES
OF PERFECTION ARE GOVERNED BY THE LAWS OF ANOTHER JURISDICTION.
SECTION 10.05. Notices. All notices, requests and demands to or upon
the respective parties hereto to be effective shall be in writing (including by
telecopy), and, unless otherwise expressly provided herein, shall be deemed to
have been duly given or made when delivered by hand, or three days after being
deposited in the mail, postage prepaid, or, in the case of telecopy notice, when
received, addressed as follows (i) in the case of the Company, the
Amended and Restated Pooling Agreement 129
Master Servicer and the Trustee, or to such other address as may be hereafter
notified by the respective parties hereto:
The Company:
LFI Receivables Corporation
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Attention of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to the Master Servicer
The Master Servicer:
LFI Servicing Corporation
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Attention of ▇▇▇▇▇ Milan and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
The Trustee:
The Chase Manhattan Bank
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▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention of Advanced Structured Products Group
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Any notice required or permitted to be mailed to a Holder shall be given by
first-class mail, postage prepaid, at the address of such Holder as shown in the
Certificate Register, the Exchange Register or the Subordinated Interest
Register, as the case may be. Any notice so mailed within the time prescribed in
any Pooling and Servicing Agreement shall be conclusively presumed to have been
duly given, whether or not the Holder receives such notice.
Amended and Restated Pooling Agreement 130
SECTION 10.06. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of any Pooling and Servicing
Agreement shall for any reason whatsoever be held invalid, then such covenants,
agreements, provisions or terms shall be deemed severable from the remaining
covenants, agreements, provisions or terms of such Pooling and Servicing
Agreement and shall in no way affect the validity or enforceability of the other
provisions of any Pooling and Servicing Agreement or of the Investor
Certificates or rights of the Holders.
SECTION 10.07. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 5.03 of the Servicing Agreement,
no Pooling and Servicing Agreement may be assigned by the Company, the Master
Servicer or any Servicer without the prior written consent of the Trustee acting
on behalf of the holders of 66-2/3% of the Invested Amount of each Outstanding
Series and without the Rating Agency Condition having been satisfied with
respect to such assignment.
SECTION 10.08. Investor Certificates Nonassessable and Fully Paid.
It is the intention of the parties to each Pooling and Servicing Agreement that
the Investor Certificateholders shall not be personally liable for obligations
of the Trust, that the interests in the Trust represented by the Investor
Certificates shall be nonassessable for any losses or expenses of the Trust or
for any reason whatsoever and that Investor Certificates upon authentication
thereof by the Trustee pursuant to Section 5.02 are and shall be deemed fully
paid.
SECTION 10.09. Further Assurances. The Company and the Master
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 each Pooling and Servicing
Agreement, including, without limitation, the execution of any financing
statements or continuation
Amended and Restated Pooling Agreement 131
statements relating to the Receivables for filing under the provisions of the
UCC of any applicable jurisdiction.
SECTION 10.10. No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of the Trustee or the Investor
Certificateholders, any right, remedy, power or privilege, hereunder, shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, remedy, power or privilege hereunder preclude any other or further
exercise thereof or the exercise of any other right, remedy, power or privilege.
The rights, remedies, powers and privileges herein provided are cumulative and
not exhaustive of any rights, remedies, powers and privileges provided by law.
SECTION 10.11. Counterparts. This Agreement may be executed in two
or more counterparts (and by different parties on separate counterparts), each
of which shall be an original, but all of which together shall constitute one
and the same instrument.
SECTION 10.12. Third-Party Beneficiaries. This Agreement will inure
to the benefit of and be binding upon the parties hereto, the Holders and their
respective successors and permitted assigns. Except as otherwise provided in
this Section 10.12, no other Person will have any right or obligation hereunder.
SECTION 10.13. Actions by Investor Certificateholders. (a) Wherever
in any Pooling and Servicing Agreement a provision is made that an action may be
taken or a notice, demand or instruction given by Investor Certificateholders,
such action, notice or instruction may be taken or given by any Investor
Certificateholders of any Series, unless such provision requires a specific
percentage of Investor Certificateholders of a certain Series or all Series.
(b) Any request, demand, authorization, direction, notice, consent,
waiver or other act by an
Amended and Restated Pooling Agreement 132
Investor Certificateholder shall bind such Investor Certificateholder and every
subsequent holder of such Investor 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, the Company, the Master
Servicer or any Servicer in reliance thereon, whether or not notation of such
action is made upon such Investor Certificate.
SECTION 10.14. 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 and the Servicing Agreement.
This Agreement and the Servicing Agreement may not be modified, amended, waived,
or supplemented except as provided herein.
SECTION 10.15. Headings. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.
SECTION 10.16. Construction of Agreement. (a) The Company hereby
grants to the Trustee, for the benefit of the Holders a security interest in all
of the Company's right, title and interest in, to and under the Receivables and
the other Trust Assets now existing and hereafter created, all monies due or to
become due and all amounts received with respect thereto and all "proceeds"
thereof (including Recoveries), to secure all of the Company's and the Master
Servicers' obligations hereunder, including, without limitation, the Company's
obligation to sell or transfer Receivables hereafter created to the Trust.
(b) This Agreement shall constitute a security agreement under
applicable law.
SECTION 10.17. No Setoff. Except as expressly provided in this
Agreement or any other Transaction
Amended and Restated Pooling Agreement 133
Document, the Trustee 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 Company, the Master
Servicer, any Servicers or any Holder.
SECTION 10.18. No Bankruptcy Petition. Each of the Trustee and the
Master Servicer hereby covenant and agree that, prior to the date which is one
year and one day after the date of the end of the Amortization Period with
respect to all Outstanding Series, it will not institute against, or join any
other Person in instituting against, the Company any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings, or other proceedings under
any Federal or state bankruptcy or similar law.
SECTION 10.19. Limitation of Liability. It is expressly understood
and agreed by the parties hereto that (a) each Pooling and Servicing Agreement
is executed and delivered by the Trustee, not individually or personally but
solely as Trustee of the Trust, in the exercise of the powers and authority
conferred and vested in it, (b) except with respect to Section 8.15 hereof the
representations, undertakings and agreements herein made on the part of the
Trust are made and intended not as personal representations, undertakings and
agreements by the Trustee, but are made and intended for the purpose of binding
only the Trust, (c) nothing herein contained shall be construed as creating any
liability on the Trustee, individually or personally, to perform any covenant
either expressed or implied contained herein, all such liability, if any, being
expressly waived by the parties who are signatories to this Agreement and by any
Person claiming by, through or under such parties; provided, however, the
Trustee shall be liable in its individual capacity for its own wilful misconduct
or gross negligence and for any tax assessed against the Trustee based on or
measured by any fees, commission or compensation received by it for acting as
Trustee and (d) under no circumstances shall the Trustee be personally liable
for the payment of any indebtedness or expenses of the Trust or be
Amended and Restated Pooling Agreement 134
liable for the breach or failure of any obligation, representation, warranty or
covenant made or undertaken by the Trust under any Pooling and Servicing
Agreement; provided further that the foregoing clauses (a) through (d) shall
survive the resignation or removal of the Trustee.
The Company hereby agrees to indemnify and hold harmless the Trustee
and the Trust (for the benefit of the Holders) (each, an "Indemnified Person")
from and against any loss, liability, expense, damage or injury suffered or
sustained by reason of any acts, omissions or alleged acts or omissions arising
out of, or relating to, activities of the Company pursuant to any Pooling and
Servicing Agreement to which it is a party, including but not limited to any
judgment, award, settlement, reasonable attorneys' fees and other reasonable
costs or expenses incurred in connection with the defense of any actual or
threatened action, proceeding or claim, except to the extent such loss,
liability, expense, damage or injury resulted from the gross negligence, bad
faith or wilful misconduct of an Indemnified Person or resulted from the
performance of any Receivable, market fluctuations or other market or investment
risk not attributable to acts or omissions or alleged acts or omissions of the
Company; provided, however, that any payments to be made by the Company pursuant
to this subsection shall be Company Subordinated Obligations.
SECTION 10.20. Certain Information. The Master Servicer and the
Company shall promptly provide to the Trustee such information in computer tape,
hard copy or other form regarding the Receivables as the Trustee may reasonably
determine to be necessary to perform its obligations hereunder.
Amended and Restated Pooling Agreement 135
IN WITNESS WHEREOF, the Company, the Master 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.
LFI RECEIVABLES CORPORATION,
by_____________________________
Name:
Title:
LFI SERVICING CORPORATION, as
Master Servicer,
by_____________________________
Name:
Title:
THE CHASE MANHATTAN BANK, not
in its individual capacity but
solely as Trustee,
by_____________________________
Name:
Title:
SCHEDULE 1 to the
AMENDED AND RESTATED
POOLING AGREEMENT
Receivables
Delivered or transmitted via computer tapes, diskettes or data
transmission pursuant to Section 2.01.
SCHEDULE 2 to the
AMENDED AND RESTATED
POOLING AGREEMENT
Identification of Trust Accounts
The following accounts have been established by and at The Chase
Manhattan Bank:
Name Number
---- ------
Collection Account
Company Collection Subaccount
SCHEDULE 3 to the
AMENDED AND RESTATED
POOLING AGREEMENT
Location of Chief Executive Office of the Company
LFI Receivables Corporation
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▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Exhibit B to the
AMENDED AND RESTATED
Pooling Agreement
FORM OF ANNUAL OPINION OF COUNSEL
PROVISIONS TO BE INCLUDED
IN ANNUAL OPINION OF COUNSEL DELIVERED PURSUANT TO
SECTION 2.07(b) OF THE POOLING AGREEMENT ON JANUARY ,
OF EACH YEAR COMMENCING WITH JANUARY , 1998
The opinion set forth below, which is to be delivered pursuant to
Section 2.07(b) of the Amended and Restated Pooling Agreement, dated as of
February [4], 1997, among LFI Receivables Corporation, LFI Servicing
Corporation, as Master Servicer, and The Chase Manhattan Bank, as Trustee, may
be subject to certain qualifications, assumptions, limitations and exceptions
taken or made in the opinions of counsel delivered on the Initial Issuance Date
with respect to similar matters. In addition, the opinion may contain the
following qualification as applicable:
With your permission, we have based our opinions set forth in paragraphs
1, 2 and 3 below as they relate to the laws of [states in which the opiner
does not have an office] (each a "UCC State") solely upon our review of
the relevant provisions of Sections 9-102, 9-103, 9-105, 9-106, 9-302,
9-304, 9-306, 9-401, 9-402 and 9-403 [and such additional Sections as the
opiner may determine] of the Uniform Commercial Code as enacted in each
UCC State as set forth in [the CCH Secured Transactions Guide or a similar
compilation]. We have assumed such provisions are presently in effect and
have not been modified in any respect by any other statute, regulation or
court decision with respect to the laws of each such UCC State or
otherwise. We call to your attention that we are not licensed to practice
in any of the UCC States nor do we profess any expertise with respect to
the laws thereof.
1. With respect to the transfer by each Seller to LFI Receivables
Corporation of all of such Seller's right, title and interest in, to and under
the Receivables, Related Property, Collections and all rights (including
2
rescission, replevin or reclamation) relating to any Receivable originated by
such Seller or arising therefrom (collectively, the "Seller Property") pursuant
to the terms of the Receivables Sale Agreement, dated as of August 5, 1996 (as
amended and restated on February [4], 1997 and as amended, supplemented or
otherwise modified thereafter, the "Receivables Sale Agreement"), among LFI
Receivables Corporation, the Sellers named therein and the Servicers named
therein, no filing or other action, other than such filing or action described
in the [opinions of counsel delivered on the Initial Issuance Date] [or the
opinions delivered on [ ] of the prior year pursuant to Section 2.07(b) of the
Pooling Agreement] with respect to similar matters, is necessary from the date
of such opinions through 90 days into the following calendar year to continue
the perfected and priority status of the interest of LFI Receivables Corporation
in such Seller Property.
2. With respect to the transfer by LFI Receivables Corporation to
the Trust of all of LFI Receivables Corporation's right, title and interest in,
to and under the Receivables and the other Trust Assets (as defined in the
Pooling Agreement) (collectively, the "Trust Property") pursuant to the terms of
the Pooling Agreement, no filing or other action, other than such filing or
action described in the [opinions of counsel delivered on the initial Issuance
Date] [or the opinions delivered on [ ] of the prior year pursuant to Section
2.07(b) of the Pooling Agreement] with respect to similar matters is necessary
from the date of such opinions through 90 days into the following calendar year
to continue the perfected and priority status of the interest of the Trust in
such Trust Property.
3. Set forth on Schedule __ to this opinion is a list of all UCC
Financing Statements which have been filed by each Seller relating to the Seller
Property and by LFI Receivables Corporation relating to the Trust Property and
the earliest and latest date under the applicable UCC on
3
which continuation statements may be filed for each such financing statement.(1)
----------
(1) In the event that the earliest date for filing any continuation
statement occurs prior to January 30 of the following year, such opinion shall
also be delivered to each Seller, LFI Receivables Corporation and the Servicers
with a notice stating that such continuation statements shall be filed on such
earliest date.
Exhibit B to the
AMENDED AND RESTATED
Pooling Agreement
FORM OF ANNUAL OPINION OF COUNSEL
PROVISIONS TO BE INCLUDED
IN ANNUAL OPINION OF COUNSEL DELIVERED PURSUANT TO
SECTION 2.07(b) OF THE POOLING AGREEMENT ON JANUARY ,
OF EACH YEAR COMMENCING WITH JANUARY , 1998
The opinion set forth below, which is to be delivered pursuant to
Section 2.07(b) of the Amended and Restated Pooling Agreement, dated as of
February [4], 1997, among LFI Receivables Corporation, LFI Servicing
Corporation, as Master Servicer, and The Chase Manhattan Bank, as Trustee, may
be subject to certain qualifications, assumptions, limitations and exceptions
taken or made in the opinions of counsel delivered on the Initial Issuance Date
with respect to similar matters. In addition, the opinion may contain the
following qualification as applicable:
With your permission, we have based our opinions set forth in paragraphs
1, 2 and 3 below as they relate to the laws of [states in which the opiner
does not have an office] (each a "UCC State") solely upon our review of
the relevant provisions of Sections 9-102, 9-103, 9-105, 9-106, 9-302,
9-304, 9-306, 9-401, 9-402 and 9-403 [and such additional Sections as the
opiner may determine] of the Uniform Commercial Code as enacted in each
UCC State as set forth in [the CCH Secured Transactions Guide or a similar
compilation]. We have assumed such provisions are presently in effect and
have not been modified in any respect by any other statute, regulation or
court decision with respect to the laws of each such UCC State or
otherwise. We call to your attention that we are not licensed to practice
in any of the UCC States nor do we profess any expertise with respect to
the laws thereof.
1. With respect to the transfer by each Seller to LFI Receivables
Corporation of all of such Seller's right, title and interest in, to and under
the Receivables, Related Property, Collections and all rights (including
2
rescission, replevin or reclamation) relating to any Receivable originated by
such Seller or arising therefrom (collectively, the "Seller Property") pursuant
to the terms of the Receivables Sale Agreement, dated as of August 5, 1996 (as
amended and restated on February [4], 1997 and as amended, supplemented or
otherwise modified thereafter, the "Receivables Sale Agreement"), among LFI
Receivables Corporation, the Sellers named therein and the Servicers named
therein, no filing or other action, other than such filing or action described
in the [opinions of counsel delivered on the Initial Issuance Date] [or the
opinions delivered on [ ] of the prior year pursuant to Section 2.07(b) of the
Pooling Agreement] with respect to similar matters, is necessary from the date
of such opinions through 90 days into the following calendar year to continue
the perfected and priority status of the interest of LFI Receivables Corporation
in such Seller Property.
2. With respect to the transfer by LFI Receivables Corporation to
the Trust of all of LFI Receivables Corporation's right, title and interest in,
to and under the Receivables and the other Trust Assets (as defined in the
Pooling Agreement) (collectively, the "Trust Property") pursuant to the terms of
the Pooling Agreement, no filing or other action, other than such filing or
action described in the [opinions of counsel delivered on the initial Issuance
Date] [or the opinions delivered on [ ] of the prior year pursuant to Section
2.07(b) of the Pooling Agreement] with respect to similar matters is necessary
from the date of such opinions through 90 days into the following calendar year
to continue the perfected and priority status of the interest of the Trust in
such Trust Property.
3. Set forth on Schedule __ to this opinion is a list of all UCC
Financing Statements which have been filed by each Seller relating to the Seller
Property and by LFI Receivables Corporation relating to the Trust Property and
the earliest and latest date under the applicable UCC on
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which continuation statements may be filed for each such financing statement.(1)
----------
(1) In the event that the earliest date for filing any continuation
statement occurs prior to January 30 of the following year, such opinion shall
also be delivered to each Seller, LFI Receivables Corporation and the Servicers
with a notice stating that such continuation statements shall be filed on such
earliest date.
EXHIBIT B-1 to the
POOLING AGREEMENT
[FORM OF LOCKBOX AGREEMENT]
, 1996
[Name and address of Lockbox Bank]
Attention:
Ladies and Gentlemen:
LFI Receivables Corporation, a Delaware corporation (the "Company"),
has agreed to purchase certain receivables (the "Receivables") from a number of
Sellers (the "Sellers", and in their capacity as servicers pursuant to the
Transaction Documents, the "Servicers") pursuant to the Receivables Sale
Agreement, dated as of August 5, 1996 (as amended, supplemented or otherwise
modified from time to time, the "Receivables Sale Agreement"), among the
Sellers, the Servicers and the Company. The Company has in turn assigned the
Receivables to a master trust (the "Master Trust") pursuant to a Pooling
Agreement, dated as of August 5, 1996 (as amended, supplemented or otherwise
modified from time to time, the "Pooling Agreement"), among the Company, LFI
Servicing Corporation, as master servicer (in such capacity, the "Master
Servicer") and The Chase Manhattan Bank, a New York banking corporation, as
trustee (the "Trustee"). The Receivables are serviced pursuant to the terms of a
Servicing Agreement, dated as of August 5, 1996 (as the same may be amended,
supplemented or otherwise modified from time to time, the "Servicing Agreement";
and, collectively with the Pooling Agreement, the "Pooling and Servicing
Agreements") among the Company, the Servicers, the Master Servicer and the
Trustee. Capitalized terms used herein but not defined herein shall have the
meanings assigned to such terms in the Pooling Agreement.
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Pursuant to the terms of the Pooling and Servicing Agreements and
except as otherwise provided therein, (i) each of the Servicers has agreed to
instruct all Obligors under the Receivables originated by it as Seller to make
all payments in respect of such Receivables to a blocked deposit account (each,
a "Lockbox Account") designated by such Servicer to such Obligor and (ii) the
Company has agreed to grant a security interest in its right, title and interest
in each Lockbox Account and all funds and other evidences of payment held
therein to the Trustee. Furthermore, the Company, the Master Servicer, each of
the Servicers and the Trustee have agreed, pursuant to the Pooling and Servicing
Agreements, to enter into an agreement with each bank maintaining a Lockbox
Account and hereby request that [name of Lockbox Bank] (the "Lockbox Bank") act
as, and the Lockbox Bank hereby agrees to act as, a lockbox deposit bank for the
Company with respect to the Lockbox Account. This Letter Agreement defines
certain rights and obligations with respect to the appointment of the Lockbox
Bank.
Accordingly, the Company, the Master Servicer, the Servicer party
hereto, the Trustee and the Lockbox Bank agree as follows:
Reference is made to the Lockbox Account (Account No.___________),
including box number ____________ thereunder (collectively, the "Specified
Account"), maintained with you by the related Servicer. The related Servicer
hereby transfers the Specified Account to the Company and hereafter the
Specified Account shall be in the name of the Company and maintained by the
Lockbox Bank for the benefit of the Company and the Trustee, as set forth
herein. All funds and other evidences of payment received by the Lockbox Bank in
its capacity as Lockbox Bank shall be deposited in the Specified Account. Such
payments shall not be commingled with other funds. All funds and other evidences
of payment at any time on deposit in the Specified Account shall be held by the
Lockbox Bank for application strictly in accordance with the terms of this
Letter Agreement. The Lockbox Bank agrees to give the Trustee, the Company, the
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Master Servicer and the related Servicer prompt notice if the Specified Account
shall become subject to any writ, judgment, warrant of attachment, execution or
similar process.
The Trustee shall have sole and exclusive dominion over and control
of the Specified Account and all Collections and other property from time to
time deposited therein, and shall have the sole right of withdrawal from the
Specified Account. Each of the Company, the Master Servicer and the related
Servicer acknowledges and agrees that it shall not have any dominion over or
control of the Specified Account or any Collections or other property from time
to time deposited therein including any right to withdraw or utilize any funds
or other evidences of payment on deposit in the Specified Account, other than
the right to authorize transfers to the Collection Account as set forth herein
and pursuant to the terms of the Pooling and Servicing Agreements. The Lockbox
Bank shall automatically, by 1:00 p.m., New York City time, at least as often as
once each day that is a business day for the Lockbox Bank and for the Trustee,
transfer, by means of the Automated Clearing House System, all available funds
on deposit in the Specified Account, including all funds transferred from
Obligors on or before the end of the preceeding day, along with, subject to the
next succeeding sentence, all remittance advisements and payment invoices on
deposit therein, to the Collection Account. The Lockbox Bank acknowledges that,
until it receives instructions from the Trustee to the contrary, the Lockbox
Bank shall return to the Company, upon the Company's reasonable request
therefor, any remittance advisements and payment invoices deposited into the
Specified Account.
Deposited checks with respect to the Specified Account returned to
the Lockbox Bank for any reason will be charged against the Specified Account.
Nothing contained in the previous sentence shall be construed to prejudice other
rights of the Lockbox Bank, which rights include the right
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of recourse against the Company for any overdrafts in the Specified Account.
The Trustee is authorized to receive mail delivered to the Lockbox
Bank with respect to the Specified Account and the Company has filed a form of
standing delivery order with the United States Postal Service authorizing the
Trustee to receive mail delivered to the Lockbox Bank with respect to the
Specified Account.
The Lockbox Bank shall also furnish the Trustee with statements, in
the form and manner typical for the Lockbox Bank, of amounts of deposits in, and
amounts transferred to the Collection Account from, the Specified Account
pursuant to any reasonable request of the Trustee but in any event not less
frequently than monthly and such other information relating to the Specified
Account at such times as shall be reasonably requested by the Trustee.
For purposes of this Letter Agreement, any officer of the Trustee
shall be authorized to act, and to give instructions and notice, on behalf of
the Trustee hereunder.
The fees for the services of the Lockbox Bank shall be mutually
agreed upon between the Company and the Lockbox Bank and paid by the Company.
Neither the Trustee nor any investor in the Master Trust shall have any
responsibility or liability for the payment of any such fee.
The Lockbox Bank may perform any of its duties hereunder by or
through its officers, employees or agents and shall be entitled to rely upon the
advice of counsel as to its duties. The Lockbox Bank shall not be liable to the
Trustee, the Master Servicer, any Servicer or the Company for any action taken
or omitted to be taken by it in good faith, nor shall the Lockbox Bank be
responsible to the Trustee, the Master Servicer, any Servicer or the Company for
the consequences of any oversight or error of judgment or be answerable to the
Trustee for the same, unless such action, omission, oversight or error of
judgment shall
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happen through the Lockbox Bank's negligence or willful misconduct.
The Lockbox Bank hereby represents and warrants that (a) it is a
banking corporation duly organized, validly existing and in good standing under
the laws of [ ] and has full corporate power and authority under such laws to
execute, deliver and perform its obligations under this Agreement and (b) the
execution, delivery and performance of this Agreement by the Lockbox Bank have
been duly and effectively authorized by all necessary coporate action and this
Agreement has been duly executed and delivered by the Lockbox Bank and
constitutes a valid and binding obligation of the Lockbox Bank enforceable in
accordance with its terms.
The Lockbox Bank may resign at any time as Lockbox Bank hereunder by
delivery to the Trustee and the Company of written notice of resignation not
less than 30 days prior to the effective date of such resignation. The Company
may, with the written consent of the Trustee, and, if the Company shall refuse
any demand by the Trustee to do so in the event (i) an Early Amortization Event
shall occur and be continuing or (ii) there has been a failure by the Lockbox
Bank to perform any of its material obligations hereunder and such failure could
adversely affect the Trustee's interest in any Receivable or the Trustee's
rights, or ability to exercise any remedies, under this Letter Agreement or the
Pooling and Servicing Agreements, the Trustee may close the Specified Account at
any time by delivery of notice to the Lockbox Bank and the Company at the
addresses appearing below. This Letter Agreement shall terminate upon receipt of
such notice of closing, or delivery of such notice of resignation, except that
the Lockbox Bank shall immediately transfer to the Collection Account, or any
other account designated by the Trustee all available funds or, subject to the
Company's reasonable request to retain such items, any remittance advisements or
payment invoices, if any, then on deposit in, or otherwise to the credit of, the
Specified Account and deliver any
6
available funds or such remittance advisements or payment invoices relating to
the Receivables received by the Lockbox Bank after such notice directly to the
Collection Account or any other account designated by the Trustee.
All notices and communications hereunder shall be in writing (except
where telephonic instructions or notices are authorized herein) and shall be
deemed to have been received and shall be effective on the day on which
delivered (including delivery by telex):
(i) in the case of the Trustee, to it at:
The Chase Manhattan Bank
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Advanced Structured Products
Group
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) in the case of the Lockbox Bank, to it at:
Attention:
Telecopy No.:
(iii) in the case of the Company, to it at:
LFI Receivables Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ Milan and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
7
(iv) in the case of the Master Servicer, to it at:
LFI Servicing Corporation
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ Milan and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telecopy No.: (▇▇▇) ▇▇▇-▇▇▇▇
(v) in the case of the Servicer party hereto, to it at:
Attention:
Telecopy No.:
The Lockbox Bank shall not assign or transfer any of its rights or
obligations hereunder (other than to the Trustee) without the prior written
consent of the Trustee. Notwithstanding anything herein to the contrary, upon
the succession of the Master Servicer to the Servicer party hereto in accordance
with and under the [Servicing Agreement], the Master Servicer shall succeed to,
and be substituted for, and may exercise every right and power of, the Servicer
party hereto under this Letter Agreement with the same effect as if the Master
Servicer had been named as the Servicer party hereto. This Letter Agreement may
be amended only by a written instrument executed by the Company, the Master
Servicer, the Servicer party hereto, the Trustee and the Lockbox Bank, acting by
their representative officers thereunto duly authorized. Except with respect to
the amount of its fees payable hereunder, the Lockbox Bank hereby
unconditionally and irrevocably waives (so long as the Pooling and Servicing
Agreements are in effect) any rights of setoff or banker's lien against, or to
otherwise deduct from, any funds or other evidences of payment held in any
Specified Account for any indebtedness or other claim owed by the Company, the
Master Servicer or any Servicer to the Lockbox Bank.
THIS LETTER AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF NEW
8
YORK, EXCEPT TO THE EXTENT THAT THE VALIDITY OR PERFECTION OF THE SECURITY
INTEREST OR REMEDIES HEREUNDER IN RESPECT OF ANY RECEIVABLE MAY BE GOVERNED BY
THE LAW OF A JURISDICTION OTHER THAN NEW YORK.
This Letter Agreement (i) shall inure to the benefit of, and be
binding upon, the Company, the Servicers, the Master Servicer, the Trustee, the
Lockbox Bank and their respective successors and assigns and (ii) may be
executed in two or more counterparts, each of which shall be deemed an original
but all of which together shall constitute one and the same instrument. Delivery
of an executed counterpart of a signature page to this Letter Agreement by
facsimile transmission shall be effective as delivery of a manually executed
counterpart of this Letter Agreement.
IN WITNESS WHEREOF, the parties hereto have caused this Letter
Agreement to be executed by their duly authorized officers as of the date first
above written.
Very truly yours,
LFI RECEIVABLES CORPORATION,
by __________________________
Title:
[ ], as Servicer,
by __________________________
Title:
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LFI SERVICING CORPORATION, as Master
Servicer,
by __________________________
Title:
Agreed to and accepted:
[NAME OF LOCKBOX BANK],
as Lockbox Bank
by ___________________________
Title:
THE CHASE MANHATTAN BANK, as Trustee
by ___________________________
Title: