EXHIBIT 4.5
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AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION V LLC,
Transferor
AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC.,
Servicer and Administrator
AMERICAN EXPRESS ISSUANCE TRUST,
Issuer
and
THE BANK OF NEW YORK,
Indenture Trustee
---------------------------
FORM OF AMENDED AND RESTATED
TRANSFER AND SERVICING AGREEMENT
dated as of March [__], 2006
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ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION
TABLE OF CONTENTS
PAGE
Section 1.1. Definitions................................................................................1
Section 1.2. Other Definitional Provisions.............................................................21
ARTICLE II
TRUST ASSETS
Section 2.1. Conveyance of Trust Assets................................................................23
Section 2.2. Acceptance by Issuer......................................................................25
Section 2.3. Representations and Warranties of Each Transferor Relating to Such Transferor.............25
Section 2.4. Representations and Warranties of Each Transferor.........................................27
Section 2.5. Notice of Breach..........................................................................31
Section 2.6. Transfer of Ineligible Receivables and Ineligible Collateral Certificates.................31
Section 2.7. Reassignment of Trust Assets..............................................................32
Section 2.8. Additional Transferors....................................................................33
Section 2.9. Covenants of Each Transferor..............................................................34
Section 2.10. Covenants of Each Transferor With Respect to Any Applicable Receivables Purchase
Agreement.................................................................................37
Section 2.11. Reinvestment in Trust Assets..............................................................37
Section 2.12. Increases in the Invested Amount of an Existing Collateral Certificate....................38
Section 2.13. Addition of Trust Assets..................................................................39
Section 2.14. Removal of Accounts.......................................................................43
Section 2.15. Account Allocations.......................................................................45
Section 2.16. Discount Option Receivables...............................................................45
ARTICLE III
COLLECTIONS, ALLOCATIONS, DEPOSITS AND PAYMENTS
Section 3.1. Collections and Allocations...............................................................47
Section 3.2. Allocations of Finance Charge Collections and the Default Amount..........................48
Section 3.3. Allocations of Principal Collections......................................................48
Section 3.4. Allocations of the Servicing Fee..........................................................48
Section 3.5. Allocations of Amounts to the Overconcentration Account and Allocations of Amounts
on Deposit in the Overconcentration Account...............................................49
Section 3.6. Allocations of Amounts to the Excess Funding Account and Allocations of Amounts on
Deposit in the Excess Funding Account.....................................................49
Section 3.7. Final Payment.............................................................................50
Section 3.8. Payments within a Series, Class or Tranche................................................50
Section 3.9. Allocations of Finance Charge Collections, the Default Amount, the Servicing Fee
and Principal Collections Allocable to the Transferor Interest............................51
Section 3.10. Adjustments for Miscellaneous Credits and Fraudulent Charges..............................51
Section 3.11. Issuer Rate Fees..........................................................................52
Section 3.12. Designation of Remaining Principal Shortfalls.............................................53
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TABLE OF CONTENTS
(continued)
PAGE
ARTICLE IV
SERVICING OF RECEIVABLES
Section 4.1. Acceptance of Appointment and Other Matters Relating to the Servicer......................54
Section 4.2. Representations, Warranties and Covenants of the Servicer.................................55
Section 4.3. Reports and Records for the Owner Trustee and the Indenture Trustee.......................58
Section 4.4. Annual Certificate of Servicer............................................................58
Section 4.5. Annual Servicing Report of Independent Public Accountants; Copies of Reports
Available.................................................................................58
Section 4.6. Tax Treatment.............................................................................59
Section 4.7. Notices to American Express Entities......................................................59
Section 4.8. Recoveries................................................................................59
Section 4.9. Reports to the Commission.................................................................60
ARTICLE V
ADMINISTRATION OF THE TRUST; DUTIES OF THE ADMINISTRATOR
Section 5.1. Appointment of Administrator; Duties of Administrator.....................................61
Section 5.2. Records...................................................................................65
Section 5.3 Compensation..............................................................................65
Section 5.4 Additional Information to be Furnished to Issuer..........................................65
Section 5.5 Independence of Administrator.............................................................65
Section 5.6 No Joint Venture..........................................................................66
Section 5.7 Other Activities of Administrator.........................................................66
Section 5.8. Termination, Resignation and Removal of
Administrator.............................................................................66
Section 5.9. Action Upon Termination, Resignation or
Removal...................................................................................67
ARTICLE VI
OTHER MATTERS RELATING TO EACH TRANSFEROR
Section 6.1. Liability of Each Transferor..............................................................68
Section 6.2. Merger or Consolidation of, or Assumption of the Obligations of, a Transferor.............68
Section 6.3. Limitations on the Liability of Each Transferor...........................................69
Section 6.4. [RESERVED]................................................................................69
Section 6.5. Assumption of a Transferor's Obligations..................................................69
Section 6.6. Expenses..................................................................................71
ARTICLE VII
OTHER MATTERS RELATING TO THE SERVICER
Section 7.1. Liability of the Servicer.................................................................72
Section 7.2. Merger or Consolidation of, or Assumption of the Obligations of, the Servicer.............72
Section 7.3. Limitations on the Liability of the Servicer and Others...................................72
Section 7.4. Servicer Indemnification of the Trust, the Owner Trustee and the Indenture Trustee........73
Section 7.5. Resignation of the Servicer...............................................................74
Section 7.6. Access to Certain Documentation and Information Regarding the Collateral..................74
Section 7.7. Delegation of Duties......................................................................75
Section 7.8. Examination of Records....................................................................75
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TABLE OF CONTENTS
(continued)
PAGE
ARTICLE VIII
INSOLVENCY EVENTS
Section 8.1. Rights Upon the Occurrence of an Insolvency Event.........................................76
ARTICLE IX
SERVICER DEFAULTS
Section 9.1. Servicer Defaults.........................................................................77
Section 9.2. Indenture Trustee to Act; Appointment of Successor........................................79
Section 9.3. Notification to Noteholders...............................................................81
Section 9.4. Waiver of Past Defaults...................................................................81
ARTICLE X
ACQUISITION OF TRUST ASSETS
Section 10.1. Acquisition of Trust Assets...............................................................82
ARTICLE XI
TERMINATION
Section 11.1. Termination of Agreement..................................................................83
ARTICLE XII
MISCELLANEOUS
Section 12.1. Amendment; Waiver of Past Defaults........................................................84
Section 12.2. Protection of Right, Title and Interest in and to Trust Assets............................86
Section 12.3. Fees Payable by the Transferor............................................................87
Section 12.4. Governing Law; Submission to Jurisdiction; Appointment of Agent for Service of
Process...................................................................................87
Section 12.5. Notices; Payments.........................................................................87
Section 12.6. Severability of Provisions................................................................89
Section 12.7. Further Assurances........................................................................89
Section 12.8. No Waiver; Cumulative Remedies............................................................89
Section 12.9. Counterparts..............................................................................89
Section 12.10. Third-Party Beneficiaries.................................................................89
Section 12.11. Actions by Noteholders....................................................................89
Section 12.12. Rule 144A Information.....................................................................90
Section 12.13. Merger and Integration....................................................................90
Section 12.14. Headings..................................................................................90
Section 12.15. Limitation of Liability...................................................................90
Section 12.16. No Petition...............................................................................90
Section 12.17. Force Majeure.............................................................................91
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TABLE OF CONTENTS
(continued)
PAGE
ARTICLE XIII
COMPLIANCE WITH REGULATION AB
Section 13.1. Intent of Parties; Reasonableness.........................................................92
Section 13.2. Additional Representations and Warranties of the Indenture Trustee........................92
Section 13.3. Information to Be Provided by the Indenture Trustee.......................................92
Section 13.4. Report on Assessment of Compliance and Attestation........................................93
Section 13.5. Additional Representations and Warranties of the Servicer.................................94
Section 13.6. Information to Be Provided by the Servicer................................................94
Section 13.7. Report on Assessment of Compliance and Attestation........................................96
Section 13.8. Use of Subservicers and Servicing Participants............................................97
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TABLE OF CONTENTS
(continued)
PAGE
EXHIBITS
Exhibit A Form of Assignment of Receivables in Aggregate Addition Accounts A-1
Exhibit B Form of Assignment of Collateral Certificates B-1
Exhibit C Form of Assignment of Receivables in New Accounts C-1
Exhibit D Form of Reassignment of Receivables in Removed Accounts D-1
Exhibit E [Reserved] E-1
Exhibit F-1 Form of Opinion of Counsel with respect to Amendments F-1-1
Exhibit F-2 Form of Opinion of Counsel with respect to Aggregate
Addition Accounts F-2-1
Exhibit F-3 Form of Opinion of Counsel with respect to New Accounts F-3-1
Exhibit F-4 Form of Annual Opinion of Counsel F-4-1
Exhibit G Form of Annual Certification G-1
Exhibit H Servicing Criteria to be Addressed in Assessment of Compliance H-1
Exhibit I Form of Annual Certification I-1
Exhibit J Servicing Criteria to be Addressed in Assessment of Compliance J-1
SCHEDULES
Schedule 1 List of Accounts Delivered to Indenture Trustee
Schedule 2 List of Collateral Certificates Delivered to Indenture Trustee
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This AMENDED AND RESTATED TRANSFER AND SERVICING AGREEMENT
among AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION V LLC, a Delaware
limited liability company, as transferor (the "Transferor"), AMERICAN EXPRESS
TRAVEL RELATED SERVICES COMPANY, INC., a New York corporation, as servicer and
administrator (the "Servicer" and the "Administrator"), AMERICAN EXPRESS
ISSUANCE TRUST, a statutory trust created under the laws of the State of
Delaware, as issuer (the "Issuer" or the "Trust"), and THE BANK OF NEW YORK, a
New York banking corporation, in its capacity as indenture trustee (the
"Indenture Trustee"), is made and entered into as of March [__], 2006.
WHEREAS, this Transfer and Servicing Agreement, dated as of
May 19, 2005 (as amended and supplemented, the "Original Transfer Agreement"),
was entered into among the Transferor, the Servicer, the Administrator, the
Issuer and the Indenture Trustee; and
WHEREAS, the parties hereto agree to and do hereby amend and
restate the Original Transfer Agreement as of March [__], 2006, to read in its
entirety as set forth herein.
NOW, THEREFORE, in consideration of the mutual agreements
herein contained, this Agreement is hereby amended and restated to read in its
entirety as follows and each party agrees as follows for the benefit of the
other parties and the Noteholders:
ARTICLE I
DEFINITIONS AND OTHER PROVISIONS OF
GENERAL APPLICATION
Section 1.1. Definitions. Whenever used in this Agreement, the
following words and phrases shall have the following meanings, and the
definitions of such terms are applicable to the singular as well as the plural
forms of such terms and to the masculine as well as to the feminine and neuter
genders of such terms.
"Account" means (a) each Initial Account, (b) each Additional
Account (but only from and after the Addition Date with respect thereto) and (c)
each Related Account. The term "Account" shall include any account replacing an
Account in connection with the transfer of ownership of such Account from an
Account Owner to any other Account Owner (provided that such replacement account
can be traced or identified by reference to, or by way of, the code designation
in the securitization field of such replacement account, which code designation
is contained in the computer or other records of the applicable Account Owner or
TRS used to generate the computer files or microfiche lists delivered to the
Indenture Trustee pursuant to Article II). The term "Account" shall exclude any
Account, all the Receivables of which are either (a) reassigned to a Transferor
pursuant to Section 2.6 or 2.7 or (b) assigned and transferred to the Servicer
pursuant to Section 4.2. The term "Account" shall include any Removed Account
only prior to the Removal Date with respect thereto.
"Account Agreement" means, with respect to an Account, the
agreements between an Account Owner and an Obligor governing the terms and
conditions of such Account, as such agreements may be amended, modified or
otherwise changed from time to time and as distributed (including any amendments
and revisions thereto) to holders of such Account.
"Account Assignment" means, collectively, any Aggregate
Addition Account Assignment and New Account Assignment.
"Account Guidelines" means, with respect to the Accounts of
each Account Owner, the established policies and procedures of such Account
Owner, (a) relating to the operation of its charge business which generally are
applicable to its portfolio of similar accounts, including the policies and
procedures for determining the creditworthiness of customers and the extension
of charge privileges to customers and (b) relating to the maintenance of
accounts and collection of receivables, in each case as such policies and
procedures may be amended, modified or otherwise changed from time to time.
"Account Owner" means, with respect to an Account, TRS,
Centurion, FSB or any other entity that, pursuant to the Account Agreement
related to such Account, is the issuer of the charge card related to, or the
owner of, such Account; provided that the Transferor shall notify each Note
Rating Agency promptly following the designation of any Account Owner other than
TRS, Centurion or FSB.
"Accumulation Period" means, with respect to any Series, Class
or Tranche of Notes, a period following the Revolving Period during which
Principal Collections are accumulated in an account for the benefit of the
Noteholders of such Series, Class or Tranche, which shall be the controlled
accumulation period, the principal accumulation period, the early accumulation
period, the optional accumulation period, the limited accumulation period or
other accumulation period, in each case as defined with respect to such Series,
Class or Tranche in the related Indenture Supplement.
"Addition Cut Off Date" means (i) with respect to Aggregate
Addition Accounts, the date specified as such in the notice delivered with
respect thereto pursuant to subsection 2.13(c) and (ii) with respect to each New
Account, the date on which such New Account is originated.
"Addition Date" means (i) with respect to Aggregate Addition
Accounts, the date from and after which such Aggregate Addition Accounts are to
be included as Accounts pursuant to subsection 2.13(a) or (b), (ii) with respect
to Collateral Certificates, the date from and after which such Collateral
Certificates are to be included as part of the Trust Assets pursuant to
subsection 2.13(a) or (b) and (iii) with respect to each New Account, the close
of business on the last day of the Monthly Period in which such New Account was
originated.
"Addition Limit" means, unless and until each Note Rating
Agency otherwise consents in writing, (i) the aggregate number of Additional
Accounts designated with respect to any three consecutive Monthly Periods shall
not exceed 15% of the aggregate number of Accounts as of the first day of such
three-month period, (ii) the aggregate number of Additional Accounts designated
with respect to any twelve consecutive Monthly Periods shall not exceed 20% of
the aggregate number of Accounts as of first day of such twelve-month period,
(iii) the aggregate amount of Receivables added to the Trust with respect to any
three consecutive Monthly Periods shall not exceed 15% of the aggregate amount
of Receivables in the Trust as of the first day of such three-month period and
(iv) the aggregate amount of Receivables added to the Trust with respect to any
twelve consecutive Monthly Periods shall not exceed 20% of the aggregate amount
of Receivables in the Trust as of the first day of such twelve-month period.
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"Additional Account" means each New Account and each Aggregate
Addition Account.
"Additional Transferor" has the meaning specified in Section
2.8.
"Administrator" means TRS, in its capacity as Administrator of
the Trust, and any successors or assigns thereto.
"Adverse Effect" has the meaning specified in the Indenture.
"Affiliate" has the meaning specified in the Indenture.
"Aggregate Addition" means the designation of additional
Eligible Accounts, other than New Accounts, to be included as Accounts pursuant
to subsection 2.13(a) or (b).
"Aggregate Addition Account" means each charge account
established pursuant to an Account Agreement between an Account Owner and any
Person, which account is designated pursuant to subsection 2.13(a) or (b) to be
included as an Account and identified in the computer file or microfiche list
delivered to the Issuer and the Indenture Trustee by the Transferor pursuant to
Section 2.1 and subsection 2.13(c).
"Aggregate Addition Account Assignment" has the meaning
specified in subsection 2.13(c)(viii).
"Agreement" means the Original Transfer Agreement, as amended
and restated by this Transfer and Servicing Agreement, as the same may be
further amended, supplemented or otherwise modified from time to time.
"Amortization Period" means, with respect to any Series, Class
or Tranche of Notes, a period following the Revolving Period during which
Principal Collections are distributed to Noteholders of such Series, Class or
Tranche, which shall be the controlled amortization period, the principal
amortization period, the early amortization period, the optional amortization
period, the limited amortization period or other amortization period, in each
case as defined with respect to such Series, Class or Tranche in the related
Indenture Supplement.
"Appointment Date" has the meaning specified in Section 8.1.
"Assigned Assets" has the meaning specified in Section 6.5.
"Assumed Obligations" has the meaning specified in
Section 6.5.
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"Assuming Entity" has the meaning specified in Section 6.5.
"Assumption Agreement" has the meaning specified in
subsection 6.5(a).
"Authorized Newspaper" has the meaning specified in the
Indenture.
"Authorized Officer" means:
(a) with respect to the Issuer, any officer of the Owner
Trustee who is authorized to act for the Owner Trustee in matters relating to
the Issuer and who is identified on the list of Authorized Officers, containing
the specimen signature of each such Person, delivered by the Owner Trustee to
the Indenture Trustee from time to time, and any officer of the Administrator
who is authorized to act for the Administrator in matters relating to the Issuer
and to be acted upon by the Administrator pursuant to this Agreement and who is
identified on the list of Authorized Officers, containing the specimen
signatures of such officers, delivered by the Administrator to the Indenture
Trustee from time to time;
(b) with respect to each Transferor, any officer of such
Transferor who is identified on the list of Authorized Officers, containing the
specimen signature of each such Person, delivered by such Transferor to the
Indenture Trustee from time to time; and
(c) with respect to the Servicer, any Servicing Officer.
"Available Overconcentration Account Amount" means, for any
Monthly Period, the lesser of (a) the amount on deposit in the Overconcentration
Account on the related First Note Transfer Date (before giving effect to any
deposit made or to be made pursuant to subsection 3.9(d) to the
Overconcentration Account on such date) and (b) the Required Overconcentration
Account Amount.
"Available Principal Collections" has, with respect to any
Outstanding Series of Notes, the meaning specified in the related Indenture
Supplement for such Series.
"Bearer Notes" has the meaning specified in the Indenture.
"Beneficial Interest" has the meaning specified in the Trust
Agreement.
"Beneficiary" has the meaning specified in the Trust
Agreement.
"Business Day" has the meaning specified in the Indenture.
"Centurion" means American Express Centurion Bank, a Utah
industrial bank, and its permitted successors and assigns.
"Certificate Assignment" has the meaning specified in
subsection 2.13(c)(ix).
"Class" has the meaning specified in the Indenture.
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"Collateral Certificate" means any Investor Certificate issued
pursuant to a Pooling and Servicing Agreement and the related Series Supplement
that has been transferred to the Trust pursuant to subsection 2.13(a) or (b).
"Collateral Certificate Principal Shortfall Payments" means
for any Monthly Period, amounts received on each Collateral Certificate in
respect of Principal Shortfalls (as such term is defined in the applicable
Series Supplement).
"Collection Account" has the meaning specified in the
Indenture.
"Collections" means for any Monthly Period, the sum of (i)
with respect to Receivables included as part of the Trust Assets, all payments
by or on behalf of Obligors (excluding Recoveries) received in respect of the
Receivables, in the form of cash, checks, wire transfers, electronic transfers,
ATM transfers or any other form of payment in accordance with the related
Account Agreement in effect from time to time and all other amounts specified by
this Agreement, the Indenture or the applicable Indenture Supplement as
constituting Collections and (ii) with respect to any Collateral Certificate
included as part of the Trust Assets, collections allocable to the holder of
such Collateral Certificate pursuant to the applicable Series Supplement for
such Collateral Certificate.
"Commercial Obligor" means the corporation, limited liability
company, partnership (general or limited), joint venture, association,
joint-stock company, trust, unincorporated organization, governmental entity or
other entity of similar nature (each, a "commercial entity") who is an Obligor
on the Account Agreement between an Account Owner and such commercial entity.
"Commercial Obligor Overconcentration Amount" means, with
respect to any Monthly Period, and with respect to any Commercial Obligor, the
amount of Principal Receivables due from such Commercial Obligor and (without
duplication) its Related Obligors as of the close of business on the last day of
the preceding Monthly Period which, expressed as a percentage of the Pool
Balance, exceeds (a) 1.50% for Commercial Obligors rated below BBB- (including
any private, confidential, estimated or shadow rating) by Standard & Poor's or
not rated by Standard & Poor's or as otherwise consented to by Standard &
Poor's; (b) 2.75% for Commercial Obligors rated from BBB to BBB- (including any
private, confidential, estimated or shadow rating) by Standard & Poor's or as
otherwise consented to by Standard & Poor's; (c) 4.00% for Commercial Obligors
rated from A to BBB+ (including any private, confidential, estimated or shadow
rating) by Standard & Poor's or as otherwise consented to by Standard & Poor's;
and (d) 5.00% for Commercial Obligors rated A+ (including any private,
confidential, estimated or shadow rating) by Standard & Poor's or as otherwise
consented to by Standard & Poor's; provided that other percentages may be used
to the extent Standard & Poor's has confirmed in writing that a Ratings Effect
will not occur in connection therewith. Receivables due from Commercial Obligors
rated AA- or higher (including any private, confidential, estimated or shadow
rating) by Standard & Poor's or as otherwise consented to by Standard & Poor's,
together with Receivables due from their Related Obligors, will be excluded from
the computation of the Commercial Obligor Overconcentration Amount.
"Commission" means the United States Securities and Exchange
Commission.
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"Corporate Trust Office" has the meaning (i) when used in
respect of the Owner Trustee, specified in the Trust Agreement and (ii) when
used in respect of the Indenture Trustee, specified in the Indenture.
"Credco" means American Express Credit Corporation, a Delaware
corporation, including any subsidiary thereof, and its permitted successors and
assigns.
"Date of Processing" means, with respect to any transaction or
receipt of Collections, the Business Day after such transaction or receipt is
first output in written form under the Servicer's customary and usual servicing
practices, from the Servicer's computer file of accounts comparable to the
Accounts (without regard to the effective date of such recordation).
"Default Amount" means for any Monthly Period, the sum of (i)
with respect to Receivables included as part of the Trust Assets, an amount
(which shall not be less than zero) equal to (a) the aggregate amount of
Principal Receivables (other than Ineligible Receivables) which became Defaulted
Receivables in such Monthly Period, minus (b) the aggregate amount of Recoveries
received in such Monthly Period (not to exceed the amount set forth in clause
(a)) in respect of Defaulted Accounts, minus (c) the amount of any Defaulted
Receivables of which a Transferor or the Servicer became obligated to accept
reassignment or assignment in accordance with the terms of this Agreement during
such Monthly Period; provided, however, that if an Insolvency Event occurs with
respect to any Transferor, the amount of such Defaulted Receivables which are
subject to reassignment to such Transferor in accordance with the terms of this
Agreement shall not be added to the sum so subtracted and, if any of the events
described in subsection 9.1(d) occur with respect to the Servicer, the amount of
such Defaulted Receivables which are subject to assignment to the Servicer in
accordance with the terms of this Agreement shall not be added to the sum so
subtracted, and (ii) with respect to any Collateral Certificate included as part
of the Trust Assets, the investor default amount or similar amount allocated to
the holder of the Collateral Certificate for such Monthly Period pursuant to the
applicable Series Supplement for such Collateral Certificate.
"Defaulted Account" means any Account that has Defaulted
Receivables.
"Defaulted Receivables" means for any Monthly Period, all
Principal Receivables which are charged off as uncollectible in such Monthly
Period in accordance with the Account Guidelines and the Servicer's customary
and usual servicing procedures for servicing receivables comparable to the
Receivables. A Principal Receivable shall become a Defaulted Receivable on the
Date of Processing on which such Principal Receivable is recorded as charged-off
on the Servicer's computer file of Accounts.
"Derivative Agreement" has the meaning specified in the
Indenture.
"Derivative Counterparty" has the meaning specified in the
Indenture.
"Discount Note" has the meaning specified in the Indenture.
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"Discount Option Date" means initially, the date of this
Agreement and thereafter, each subsequent date on which a Discount Option
Percentage designated by the Transferor pursuant to Section 2.16 takes effect.
"Discount Option Percentage" has the meaning specified in
subsection 2.16(a).
"Discount Option Receivables" has the meaning specified in
subsection 2.16(a).
"Discount Option Receivables Collections" means on any Date of
Processing occurring on or after the initial Discount Option Date, the product
of (i) the Discount Option Percentage and (ii) Collections of Receivables
received on such Date of Processing.
"Dollars," "$" or "U.S. $" means United States dollars.
"Early Amortization Event" has the meaning specified in the
Indenture, as supplemented with respect to any Series, Class or Tranche of Notes
by the applicable Indenture Supplement.
"Eligible Account" means each charge account established
pursuant to an Account Agreement between an Account Owner and any Person, which
meets the following requirements as of the applicable Selection Date:
(i) is a charge account in existence and maintained with an
Account Owner;
(ii) is payable in Dollars;
(iii) has not been identified by the Servicer in its computer
files as cancelled due to a related Obligor's
bankruptcy or insolvency;
(iv) has an Obligor who has provided as his or her most
recent billing address an address located in the United
States or its territories or possessions or a United
States military address; provided, however, that as of
such Selection Date, up to 3% of the aggregate amount
of Receivables may have related Obligors who have
provided as their billing addresses, addresses located
outside of such jurisdictions;
(v) if such account is a charge card account, has not been
identified as an account with respect to which a
related card has been lost or stolen;
(vi) has not been sold or pledged to any other party except
for any other Account Owner that either entered into
(or, on or prior to the applicable Addition Date, will
enter into) a Receivables Purchase Agreement or that is
(or, on or prior to the applicable Addition Date, will
be) a Transferor;
(vii) does not have any receivables that have been sold or
pledged by an Account Owner to any Person other than
Credco, TRS or any Transferor; and
7
(viii) does not have receivables that have been written off or
that have been identified by the Servicer as having
been incurred as a result of the fraudulent use of a
related charge card.
Nothwithstanding the above requirements, Eligible Accounts may
include accounts, the receivables of which have been written off, or which have
been identified by the Servicer in its computer files as cancelled due to a
related Obligor's bankruptcy or insolvency, in each case as of the related
Selection Date; provided that (i) the balance of all receivables included in
such accounts is reflected on the books and records of the related Account Owner
(and is treated for purposes of this Agreement) as "zero" and (ii) borrowing and
charging privileges with respect to all such accounts have been cancelled in
accordance with the Account Guidelines applicable thereto.
"Eligible Collateral Certificate" means a Collateral
Certificate that has been duly authorized by the applicable Transferor and
validly issued by the applicable Master Trust and is entitled to the benefits of
the applicable Pooling and Servicing Agreement and with respect to which the
representations and warranties made in subsections 2.4(a), (d), (e), (f), (g)
and (h) are true and correct in all material respects.
"Eligible Deposit Account" has the meaning specified in the
Indenture.
"Eligible Institution" has the meaning specified in the
Indenture.
"Eligible Investments" has the meaning specified in the
Indenture.
"Eligible Receivable" means each Receivable:
(i) which has arisen in an Eligible Account;
(ii) which was created in compliance in all material
respects with all Requirements of Law applicable to the
Account Owner of such Eligible Account and pursuant to
an Account Agreement which complies in all material
respects with all Requirements of Law applicable to
such Account Owner, in either case, the failure to
comply with which would have an Adverse Effect;
(iii) with respect to which all material consents, licenses,
approvals or authorizations of, or registrations or
declarations with, any Governmental Authority required
to be obtained, effected or given in connection with
the creation of such Receivable or the execution,
delivery and performance by the applicable Account
Owner of the Account Agreement pursuant to which such
Receivable was created, have been duly obtained,
effected or given and are in full force and effect;
(iv) as to which, immediately prior to the transfer of such
Receivable to the Trust, the applicable Transferor has
good and marketable title thereto, free and clear of
all Liens (other than any Lien for municipal or other
local taxes of a Transferor or an Account Owner if such
taxes are not then due and payable or if such
Transferor or such Account Owner is then contesting the
validity thereof in good faith by appropriate
proceedings and has set aside on its books and records
adequate reserves with respect thereto);
8
(v) which has been the subject of either a valid transfer
and assignment from a Transferor to the Trust of all
such Transferor's right, title and interest therein
(including any proceeds thereof), or the grant of a
first-priority perfected security interest therein (and
in the proceeds thereof), effective until the
termination of the Trust;
(vi) which is the legal, valid and binding payment
obligation of an Obligor thereon, enforceable against
such Obligor in accordance with its terms, except as
such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or
other similar laws, now or hereafter in effect,
affecting the enforcement of creditors' rights in
general and except as such enforceability may be
limited by general principles of equity (whether
considered in a suit at law or in equity);
(vii) which, at the time of transfer to the Trust, has not
been waived or modified except as permitted in
accordance with the Account Guidelines and which waiver
or modification is reflected in the Servicer's computer
file of Accounts;
(viii) which, at the time of transfer to the Trust, is not
subject to any right of rescission, setoff,
counterclaim or any other defense (including defenses
arising out of violations of usury laws) of an Obligor,
other than defenses arising out of applicable
bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of
creditors' rights in general;
(ix) as to which, at the time of transfer to the Trust, the
Transferor thereof has satisfied all its obligations
required to be satisfied by such time;
(x) as to which, at the time of transfer to the Trust, none
of the Transferor, any Account Owner, Credco or TRS, as
the case may be, has taken any action which would
impair, or omitted to take any action the omission of
which would impair, the rights of the Trust or the
Noteholders therein; and
(xi) which constitutes an "account" or a "general
intangible" under and as defined in Article 9 of the
UCC as then in effect in any jurisdiction where the
filing of a financing statement is then required to
perfect the Trust's interest in such Receivable.
"Eligible Servicer" means TRS, Centurion, FSB or the Indenture
Trustee or, if none of TRS, Centurion, FSB or the Indenture Trustee is acting as
Servicer, an entity which, at the time of its appointment as Servicer, (a) is
servicing a portfolio of charge or credit accounts, (b) is legally qualified and
has the capacity to service the Accounts, (c) in the sole determination of the
Indenture Trustee, which determination shall be conclusive and binding, has
demonstrated the ability to service professionally and competently a portfolio
of similar accounts in accordance with high standards of skill and care, (d) is
qualified to use the software that is then being used to service the Accounts or
obtains the right to use or has its own software which is adequate to perform
its duties under this Agreement and (e) has a net worth of at least $50,000,000
as of the end of its most recent fiscal quarter.
9
"Event of Default" has the meaning specified in the Indenture.
"Excess Funding Account" has the meaning specified in the
Indenture.
"Excess Funding Amount" means, at any time, the aggregate
amount on deposit in the Excess Funding Account.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Execution Date" means May 19, 2005.
"Finance Charge Collections" means for any Monthly Period, the
sum of (i) with respect to Receivables included as part of the Trust Assets, all
Collections received by the Servicer on behalf of the Issuer of Finance Charge
Receivables, (ii) with respect to any Collateral Certificate included as part of
the Trust Assets, collections of finance charge receivables allocable to the
holder of the Collateral Certificate for such Monthly Period pursuant to the
applicable Series Supplement for such Collateral Certificate, (iii) any amounts
received by the Issuer which are designated as Finance Charge Collections
pursuant to this Agreement, the Indenture or any Indenture Supplement for such
Monthly Period and (iv) the amount of investment earnings (net of losses and
investment expenses), if any, on amounts on deposit in the Collection Account,
the Overconcentration Account and the Excess Funding Account for such Monthly
Period.
"Finance Charge Receivables" means the aggregate amount of
Discount Option Receivables.
"First Note Transfer Date" means for any Monthly Period, the
earliest Note Transfer Date for any Series, Class or Tranche of Notes in such
Monthly Period.
"Fitch" means Fitch, Inc., or its successor.
"Floating Allocation Percentage" has, with respect to any
Outstanding Series of Notes, the meaning specified in the related Indenture
Supplement for such Series.
"FSB" means American Express Bank, FSB, a federal savings
bank, and its permitted successors and assigns.
"Governmental Authority" means the United States of America,
any state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
10
"Increase Date" means any date on which the Invested Amount of
an existing Collateral Certificate is increased pursuant to Section 2.11 or
2.12.
"Indenture" means the Amended and Restated Indenture, dated as
of March [__], 2006, between the Issuer and the Indenture Trustee, as the same
may be amended, supplemented or otherwise modified from time to time.
"Indenture Supplement" has the meaning specified in the
Indenture.
"Indenture Trustee" means The Bank of New York, in its
capacity as indenture trustee under the Indenture, its successors in interest
and any successor indenture trustee under the Indenture.
"Ineligible Collateral Certificate" has the meaning specified
in subsection 2.6(b).
"Ineligible Receivables" has the meaning specified in
subsection 2.6(b).
"Initial Account" means each charge account established
pursuant to an Account Agreement between an Account Owner and any Person, which
account is identified in the computer file or microfiche list delivered to the
Issuer and the Indenture Trustee on the Execution Date by the Transferor
pursuant to Section 2.1.
"Initial Cut Off Date" means April 24, 2005.
"Insolvency Event" has the meaning specified in Section 8.1.
"Invested Amount" has, with respect to any Collateral
Certificate, the meaning specified in the applicable Series Supplement for such
Collateral Certificate.
"Investor Certificate" has the meaning specified in the
applicable Pooling and Servicing Agreement.
"Issuance Date" means each date on which a Series, Class or
Tranche of Notes is issued.
"Issuer" has the meaning specified in the first paragraph of
this Agreement.
"Issuer Accounts" means, collectively, the Excess Funding
Account, the Collection Account, the Overconcentration Account and any
Supplemental Issuer Account, including any Sub-Accounts thereof.
"Issuer Rate Fees" shall mean all issuer rate fees payable to
an Account Owner in connection with cardholder charges for goods or services
with respect to the Receivables.
"Issuer Tax Opinion" has the meaning specified in the
Indenture.
"Legal Maturity Date" has, for any Note, the meaning specified
in the related Indenture Supplement.
11
"Lien" means any security interest, mortgage, deed of trust,
pledge, hypothecation, assignment, deposit arrangement, equity interest,
encumbrance, lien (statutory or other), preference, participation interest,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever, including any conditional sale or other title retention
agreement, or any financing lease having substantially the same economic effect
as any of the foregoing; provided, however, that any assignment permitted by
Section 3.02 of the Trust Agreement or Section 6.2 or Section 6.5 and the lien
created by the Original Transfer Agreement or this Agreement shall not be deemed
to constitute a Lien; provided further, however, that the lien created in favor
of the Indenture Trustee under the Original Indenture or the Indenture shall not
be deemed to constitute a Lien.
"Master Trust" has the meaning specified in the Indenture.
"Master Trust Servicer" means the entity responsible for the
servicing obligations under the applicable Pooling and Servicing Agreement.
"Master Trust Tax Opinion" has the meaning specified in the
Indenture.
"Master Trust Transferor" means the entity acting as
transferor under the applicable Pooling and Servicing Agreement.
"Master Trust Trustee" means the entity acting as trustee
under the applicable Pooling and Servicing Agreement.
"Monthly Noteholders' Statement" has the meaning specified in
the Indenture.
"Monthly Interest" has, for any Series of Notes, the meaning
specified in the related Indenture Supplement.
"Monthly Period" has the meaning specified in the Indenture.
"Monthly Servicer's Certificate" means the certificate
delivered by the Servicer as described in subsection 4.3(b) in substantially the
form specified in the related Indenture Supplement.
"Moody's" means Xxxxx'x Investors Service, Inc., or its
successor.
"New Account" means each charge account established pursuant
to an Account Agreement between an Account Owner and any Person, which account
is designated pursuant to subsection 2.13(d) to be included as an Account and
identified in the computer file or microfiche list delivered to the Issuer and
the Indenture Trustee by a Transferor pursuant to Section 2.1 and subsection
2.13(e).
"New Account Assignment" has the meaning specified in
subsection 2.13(e)(vi).
"New Account Delivery Date" means, with respect to any New
Account, the fifteenth calendar day of the month (or, if such 15th calendar day
is not a Business Day, the next succeeding Business Day) following the Monthly
Period in which the Addition Date for such New Account occurs.
12
"Nominal Liquidation Amount" has, with respect to any Series,
Class or Tranche of Notes, the meaning specified in the applicable Indenture
Supplement for such Series, Class or Tranche.
"Nominal Liquidation Amount Deficit" has, with respect to any
Series, Class or Tranche of Notes, the meaning specified in the applicable
Indenture Supplement for such Series, Class or Tranche.
"Note" or "Notes" has the meaning specified in the Indenture.
"Note Owner" has the meaning specified in the Indenture.
"Note Rating Agency" means, with respect to any Outstanding
Notes, each nationally recognized statistical rating agency selected by the
Transferor to rate such Notes as specified in the applicable Indenture
Supplement for such Notes.
"Note Rating Agency Condition" means, with respect to any
action, that each Note Rating Agency shall have notified the Transferor, the
Servicer, the Owner Trustee and the Indenture Trustee in writing that such
action will not result in a reduction or withdrawal of the then existing rating
of any outstanding Series, Class or Tranche of Notes with respect to which it is
a Note Rating Agency; provided, however, that if such Series, Class or Tranche
of Notes has not been rated, the Note Rating Agency Condition with respect to
any such action shall either be defined in the applicable Indenture Supplement
or shall not apply.
"Note Register" has the meaning specified in the Indenture.
"Note Registrar" has the meaning specified in the Indenture.
"Note Transfer Date" means the Business Day prior to the
Payment Date for a Series, Class or Tranche of Notes.
"Noteholder" or "Holder" has the meaning specified in the
Indenture.
"Notice Date" has the meaning specified in subsection
2.13(c)(i).
"Notices" has the meaning specified in subsection 12.5(a).
"Obligor" means, with respect to any Account, the Person or
Persons obligated to make payments with respect to such Account, including any
guarantor thereof, but excluding any merchant.
"Officer's Certificate" has the meaning specified in the
Indenture.
"Opinion of Counsel" has the meaning specified in the
Indenture.
"Outstanding" has the meaning specified in the Indenture.
13
"Outstanding Dollar Principal Amount" has the meaning
specified in the Indenture.
"Overconcentration Account" has the meaning specified in the
Indenture.
"Owner Trustee" means Wilmington Trust Company, not in its
individual capacity, but solely as owner trustee under the Trust Agreement, its
successors in interest and any successor owner trustee under the Trust
Agreement.
"Paying Agent" has the meaning specified in the Indenture.
"Payment Date" has the meaning specified in the Indenture.
"Payment Instruction" has the meaning specified in the
Indenture.
"Person" has the meaning specified in the Indenture.
"Pool Balance" means, for any Monthly Period, the sum of (i)
the aggregate amount of Principal Receivables as of the close of business on the
last day of such Monthly Period, (ii) the sum of the Invested Amount of each
Collateral Certificate as of the close of business on the last day of such
Monthly Period and (iii) the Excess Funding Amount as of the close of business
on the last day of such Monthly Period.
"Pooling and Servicing Agreement" has the meaning specified in
the Indenture.
"Prefunding Excess Amount" has, with respect to any Series,
Class or Tranche of Notes, the meaning specified in the applicable Indenture
Supplement for such Series, Class or Tranche.
"Principal Allocation Percentage" has, with respect to any
Outstanding Series of Notes, the meaning specified in the related Indenture
Supplement for such Series.
"Principal Collections" means, for any Monthly Period, the sum
of (i) with respect to Receivables, all Collections other than those designated
as Finance Charge Collections for such Monthly Period, (ii) with respect to any
Collateral Certificate, all collections of principal receivables, including
Collateral Certificate Principal Shortfall Payments, allocable to the holder of
such Collateral Certificate for such Monthly Period pursuant to the applicable
Series Supplement for such Collateral Certificate and (iii) the amount of funds
withdrawn from the Excess Funding Account for such Monthly Period which are
required to be deposited into the Collection Account and treated as Principal
Collections in accordance with Section 3.6.
"Principal Funding Account" has, with respect to any Series,
Class or Tranche of Notes, the meaning specified in the applicable Indenture
Supplement for such Series, Class or Tranche.
"Principal Receivables" means, for any date of determination,
all Receivables other than Finance Charge Receivables.
14
"Principal Shortfalls" has the meaning specified in the
applicable Series Supplement for a Collateral Certificate.
"Proposed Principal Shortfall Amount" has the meaning
specified in Section 3.12.
"Ratings Effect" has the meaning specified in the Indenture.
"Reallocation Group" means all Reallocation Series that have
the same Reallocation Group designation.
"Reallocation Series" means a Series that, pursuant to the
Indenture Supplement therefor, will share certain Finance Charge Collections or
other specified amounts with other Series in the same Reallocation Group, as
more specifically specified in such Indenture Supplement.
"Reassignment" has the meaning specified in subsection
2.14(b).
"Reassignment Amount" means, with respect to the Receivables
or a particular Collateral Certificate subject to reassignment pursuant to
Section 2.7, for any First Note Transfer Date, the sum of (i)(a) an amount equal
to the outstanding principal balance of such Receivables as of the last day of
the prior Monthly Period or (b) the Invested Amount of such Collateral
Certificate, and (ii) accrued and unpaid interest through the related Payment
Date on Notes with an outstanding principal amount equal to the applicable
amount specified in clause (i), which interest shall be determined based on the
applicable note interest rates of each such Series, Class or Tranche of Notes
through the related Payment Date of such Series, Class or Tranche.
"Receivables" means all amounts shown on the Servicer's
records as amounts payable by an Obligor on any Account from time to time,
including amounts payable for Principal Receivables and Finance Charge
Receivables. Receivables that become Defaulted Receivables will cease to be
included as Receivables as of the day on which they become Defaulted
Receivables.
"Receivables Purchase Agreement" means (i) any receivables
purchase agreement entered into between an Account Owner and TRS for the sale of
receivables which TRS then sells to a Transferor and (ii) any receivables
purchase agreement entered into between a Transferor and an Account Owner for
the sale of receivables which such Transferor then transfers to the Trust.
"Receivables Servicing Fee" means for any Monthly Period,
one-twelfth of the product of (i) the Servicing Fee Percentage for such Monthly
Period and (ii) the aggregate amount of Principal Receivables as of the close of
business on the last day of the prior Monthly Period.
"Record Date" has the meaning specified in the Indenture.
"Recoveries" shall mean all Recoveries as defined in the
related Receivables Purchase Agreement that are paid to a Transferor as provided
in the related Receivables Purchase Agreement.
15
"Registered Note" has the meaning specified in the Indenture.
"Registered Noteholder" has the meaning specified in the
Indenture.
"Regulation AB" means Subpart 229.1100 - Asset Backed
Securities (Regulation AB), 17 C.F.R. ss.ss.229.1100-229.1123, as such may be
amended from time to time, and subject to such clarification and interpretation
as have been provided by the Commission in the adopting release (Asset-Backed
Securities, Securities Act Release No. 33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan.
7, 2005)) or by the staff of the Commission, or as may be provided by the
Commission or its staff from time to time.
"Reinvestment Amount" means, for any Monthly Period, an amount
equal to (i) the sum of (a) the Principal Collections for such Monthly Period,
(b) the Finance Charge Collections and similar amounts applied with respect to
the Default Amount and the Nominal Liquidation Amount Deficit, if any, for all
Series of Notes for such Monthly Period, (c) Collateral Certificate Principal
Shortfall Payments for such Monthly Period, (d) the portion of the Prefunding
Excess Amount, if any, paid to the Issuer pursuant to the applicable Indenture
Supplement for such Monthly Period, (e) any amounts withdrawn from the
Overconcentration Account and deposited into the Principal Funding Accounts for
all Series of Notes with respect to such Monthly Period or paid to Noteholders
with respect to such Monthly Period, (f) Dollar payments which will be received
under Derivative Agreements with respect to principal for such Monthly Period,
and (g) the aggregate amount of the accretion of principal on all Discount Notes
for such Monthly Period paid pursuant to the applicable Indenture Supplement,
minus (ii) the sum of (a) the aggregate principal amount deposited into the
Principal Funding Accounts for all Series of Notes with respect to such Monthly
Period or paid to Noteholders with respect to such Monthly Period, and (b) the
aggregate amount of Principal Collections reallocated to pay the Monthly
Interest and the Servicing Fee for such Monthly Period.
"Related Account" means each Account with respect to which a
new account number has been issued by the applicable Account Owner or the
Servicer (i) in compliance with the Account Guidelines and the related Account
Agreement, (ii) to the same Obligor or Obligors of such Account, and (iii) (a)
as a result of the charge card with respect to such Account being lost or
stolen; (b) as a result of the related Obligor requesting a change in his or her
billing cycle; (c) as a result of the related Obligor requesting the
discontinuance of responsibility with respect to such Account; (d) as a result
of the related Obligor requesting a product change; or (e) for any other reasons
permitted by the Account Guidelines; provided that such Account can be traced or
identified by reference to or by way of the code designation in the
securitization field of such Account, which code designation is contained in the
computer or other records of the applicable Account Owner or TRS used to
generate the computer files or microfiche lists delivered to the Indenture
Trustee pursuant to Article II.
"Related Agreements" means, with respect to any Series, Class
or Tranche of Notes, collectively, this Agreement, the Indenture, any applicable
Indenture Supplement and the Trust Agreement.
"Related Obligor" means, with respect to any Commercial
Obligor, any Obligor who is an employee of such Commercial Obligor who has
charging privileges.
16
"Remaining Series Available Principal Collections Shortfall"
has, with respect to any Series of Notes, the meaning specified in the
applicable Indenture Supplement for such Series of Notes.
"Removal Date" has the meaning specified in subsection
2.14(a)(i).
"Removal Notice Date" has the meaning specified in subsection
2.14(a)(i).
"Removed Accounts" has the meaning specified in Section 2.14.
"Required Overconcentration Account Amount" means, for any
Monthly Period, an amount equal to the product of (i) the Commercial Obligor
Overconcentration Amount as of the close of business on the last day of such
Monthly Period, (ii) the sum of the aggregate Floating Allocation Percentages
for all Series of Notes and (iii) (a) 100% for any Commercial Obligors rated
below BBB- by Standard & Poor's (including any private, confidential, estimated
or shadow rating) or not rated by Standard & Poor's or as otherwise consented to
by Standard & Poor's or (b) 75% for any Commercial Obligors rated BBB- or above
(including any private, confidential, estimated or shadow rating) by Standard &
Poor's or as otherwise consented to by Standard & Poor's.
"Required Pool Balance" means, for any Monthly Period, the sum
of (i) for all Notes in their Revolving Period, the sum of the Nominal
Liquidation Amounts of such Notes as of the close of business on the last day of
such Monthly Period and (ii) for all Notes in their Amortization Period, the sum
of the Nominal Liquidation Amounts of such Notes as of the close of business on
the last day of the most recent Revolving Period for each of such Notes
(exclusive of (a) any Notes that will be paid in full on the applicable Payment
Date in the following Monthly Period and (b) any Notes that will have a Nominal
Liquidation Amount of zero on the applicable Payment Date in the following
Monthly Period).
"Required Transferor Amount" means, for any Monthly Period,
the product of (i) the Principal Receivables as of the close of business on the
last day of such Monthly Period and (ii) the Required Transferor Amount
Percentage.
"Required Transferor Amount Percentage" means 15% or such
other percentage as shall be designated from time to time by the Transferor;
provided, however, that prior to designating any lesser percentage, the
Transferor shall have provided to the Indenture Trustee an Issuer Tax Opinion
and written confirmation from each Note Rating Agency that such designation
shall not have a Ratings Effect.
"Requirements of Law" means any law, treaty, rule or
regulation, or determination of an arbitrator or Governmental Authority, whether
federal, state or local (including usury laws, the Federal Truth in Lending Act
and Regulation B and Regulation Z of the Board of Governors of the Federal
Reserve System), and, when used with respect to any Person, the certificate of
incorporation and by-laws or other organizational or governing documents of such
Person.
17
"Revolving Credit Agreement" means the RFC V Revolving Credit
Agreement, as the same may be amended, supplemented or otherwise modified from
time to time, and any substantially similar agreement entered into between any
lender and a Transferor.
"Revolving Period" has, with respect to any Series, Class or
Tranche of Notes, the meaning specified in the applicable Indenture Supplement
with respect to such Series, Class or Tranche.
"RFC V" means American Express Receivables Financing
Corporation V LLC, a Delaware limited liability company, and its permitted
successors and assigns.
"RFC V Revolving Credit Agreement" means the Revolving Credit
Agreement by and between TRS and RFC V, dated as of May 19, 2005, as such
agreement may be amended from time to time in accordance therewith, or any
substantially similar agreement entered into between any lender and RFC V.
"Sarbanes Certification" shall have the meaning specified in
Section 13.4.
"Securities Act" means the Securities Act of 1933, as amended.
"Securitization Transaction" shall mean any new issuance of a
Series, Class or Tranche of Notes, pursuant to Section 4.10 of the Indenture,
whether publicly offered or privately placed, rated or unrated.
"Selection Date" means (i) (a) with respect to each Initial
Account with the code designation "AA," the close of business on the cycle
billing date for such Account occurring in the Monthly Period beginning October
2, 2004 and ending at the close of business on October 29, 2004 and (b) with
respect to each Initial Account with the code designation "5," the close of
business on the cycle billing date for such Account occurring in the Monthly
Period beginning March 18, 2004 and ending at the close of business on April 14,
2004, (ii) with respect to each Aggregate Addition Account, the date specified
as such in the notice delivered with respect thereto pursuant to subsection
2.13(c) and (iii) with respect to each New Account, the date on which such New
Account is originated.
"Series" means, with respect to any Notes, the series
specified in the applicable Indenture Supplement.
"Series Available Finance Charge Collections Shortfall" has,
with respect to any Series of Notes, the meaning specified in the applicable
Indenture Supplement for such Series of Notes.
"Series Available Principal Collections Shortfall" has, with
respect to any Series of Notes, the meaning specified in the applicable
Indenture Supplement for such Series of Notes.
"Series Supplement" has the meaning specified in the
Indenture.
"Service Transfer" has the meaning specified in Section 9.1.
18
"Servicer" means TRS, in its capacity as servicer pursuant to
this Agreement, and, after any Service Transfer, the Successor Servicer.
"Servicer Default" has the meaning specified in Section 9.1.
"Servicing Criteria" means mean the "servicing criteria" set
forth in Item 1122(d) of Regulation AB, as such may be amended from time to
time.
"Servicing Fee" has the meaning specified in subsection
3.4(a).
"Servicing Fee Percentage" means 2.00%.
"Servicing Officer" means any officer of the Servicer or an
attorney-in-fact of the Servicer who in either case is involved in, or
responsible for, the administration and servicing of the Receivables and whose
name appears on a list of servicing officers furnished to the Transferor and the
Indenture Trustee by the Servicer, as such list may from time to time be
amended.
"Servicing Participant" means the Servicer, any Subservicer or
any Person that participates in any of the servicing functions specified in Item
1122(d) of Regulation AB with respect to the Receivables. For the avoidance of
doubt, subject to Section 13.1, the term "Servicing Participant" shall not
include the Owner Trustee or the Indenture Trustee.
"Servicing Party" shall have the meaning specified in Section
13.6(a).
"Shared Excess Available Finance Charge Collections" has, with
respect to any Series of Notes, the meaning specified in the applicable
Indenture Supplement for such Series of Notes.
"Shared Excess Available Finance Charge Collections Group" has
the meaning specified in the Indenture.
"Shared Excess Available Principal Collections" has, with
respect to any Series of Notes, the meaning specified in the applicable
Indenture Supplement for such Series of Notes.
"Shared Excess Available Principal Collections Group" has the
meaning specified in the Indenture.
"Small Balances" has the meaning established in accordance
with the Account Guidelines.
"Standard & Poor's" means Standard & Poor's Ratings Services,
or its successor.
"Stated Principal Amount" has the meaning specified in the
Indenture.
"Sub-Account" has the meaning specified in the Indenture.
"Subservicer" shall mean any Person that services the
Receivables on behalf of the Servicer or any Subservicer and is responsible for
the performance (whether directly or through Subservicers or Servicing
Participants) of a substantial portion of the material servicing functions
required to be performed by the Servicer under this Agreement that are
identified in Item 1122(d) of Regulation AB. For the avoidance of doubt, subject
to Section 13.1, the term "Subservicer" shall not include the Owner Trustee or
the Indenture Trustee.
19
"Successor Servicer" has the meaning specified in subsection
9.2(a).
"Supplemental Credit Enhancement" means any Supplemental
Credit Enhancement Agreement or Supplemental Liquidity Agreement entered into
between the Trust and the applicable Supplemental Credit Enhancement Provider or
Supplemental Liquidity Provider.
"Supplemental Credit Enhancement Agreement" has the meaning
specified in the Indenture.
"Supplemental Credit Enhancement Provider" has the meaning
specified in the Indenture.
"Supplemental Issuer Account" has the meaning specified in the
Indenture.
"Supplemental Liquidity Agreement" has the meaning specified
in the Indenture.
"Supplemental Liquidity Provider" has the meaning specified in
the Indenture.
"Surviving Entity" has the meaning specified in subsection
6.2(a).
"Termination Notice" has the meaning specified in Section 9.1.
"Terms Document" has the meaning specified in the Indenture.
"Tranche" has the meaning specified in the Indenture.
"Transaction Document" means the Trust Agreement, the
applicable Pooling and Servicing Agreement, the applicable Series Supplement,
this Agreement, the Indenture or the related Indenture Supplement, as
applicable.
"Transfer Restriction Event" has the meaning specified in
Section 2.15.
"Transferor" means (a) RFC V or its successors under this
Agreement and (b) any Additional Transferor or Additional Transferors.
References to "each Transferor" shall refer to each entity mentioned in the
preceding sentence and references to "the Transferor" shall refer to all of such
entities.
"Transferor Amount" means, for any Monthly Period, an amount,
not less than zero, equal to (i) the Pool Balance for such Monthly Period minus
(ii) the aggregate Nominal Liquidation Amount of all Notes as of close of
business on the last day of such Monthly Period.
"Transferor Interest" means an interest having such rights as
are set forth in this Agreement and the other Transaction Documents, including
the right to receive amounts specified in this Agreement, the Indenture or any
Indenture Supplement to be distributed to the holders of the Transferor
Interest; provided that, as used herein and in any Indenture Supplement,
"Transferor Interest" shall mean either the uncertificated interest in the
Transferor Interest or, if the Transferor elects to evidence its interest in the
Transferor Interest in certificated form, a certificate executed and delivered
by the Issuer and authenticated by the Owner Trustee substantially in the form
of Exhibit B to the Trust Agreement.
20
"Transferor Percentage" means, for any Monthly Period, 100%
minus (a) the sum of the aggregate Principal Allocation Percentages or (b) the
sum of the aggregate Floating Allocation Percentages, as applicable, for all
Series of Notes with respect to Principal Collections, Finance Charge
Collections, the Servicing Fee or the Default Amount, as applicable.
"TRS" means American Express Travel Related Services Company,
Inc., a New York corporation, and its permitted successors and assigns.
"Trust" has the meaning specified in the first paragraph of
this Agreement.
"Trust Agreement" means the Amended and Restated Trust
Agreement relating to the Trust, dated as of March [__], 2006, between the
Transferor and the Owner Trustee, as the same may be amended, supplemented or
otherwise modified from time to time.
"Trust Assets" has the meaning specified in subsection 2.1(a).
"Trust Indenture Act" has the meaning specified in the
Indenture.
"UCC" means the Uniform Commercial Code, as amended from time
to time, as in effect in the relevant jurisdiction.
Section 1.2. Other Definitional Provisions.
(a) The terms defined in this Article have the meanings
assigned to them in this Article, and, along with any other term defined in any
Section of this Agreement, include the plural as well as the singular.
(b) With respect to any Series of Notes, all terms used herein
and not otherwise defined herein shall have meanings ascribed to them in the
applicable Transaction Document.
(c) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(d) As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
otherwise defined in this Agreement or in any such certificate or other
document, and accounting terms partly defined in this Agreement or in any such
certificate or other document to the extent not defined, shall have the
respective meanings assigned to them in accordance with generally accepted
accounting principles and, except as otherwise herein expressly provided, the
term "generally accepted accounting principles" with respect to any computation
required or permitted hereunder means such accounting principles as are
generally accepted in the United States of America at the date of such
computation.
21
(e) The agreements, representations and warranties of RFC V in
this Agreement in its capacity as a Transferor shall be deemed to be the
agreements, representations and warranties of each such entity solely in such
capacity for so long as such entity acts in such capacity under this Agreement.
The agreements, representations and warranties of TRS in this Agreement in its
capacity as the Servicer shall be deemed to be the agreements, representations
and warranties of such entity solely in such capacity for so long as such entity
acts in such capacity under this Agreement.
(f) Any reference to each Note Rating Agency shall only apply
to any specific rating agency if such rating agency is then rating any
Outstanding Series, Class or Tranche of Notes.
(g) Unless otherwise specified, references to any amount as on
deposit or outstanding on any particular date shall mean such amount at the
close of business on such day.
(h) The words "hereof," "herein," "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement; references to any
subsection, Section, Schedule or Exhibit are references to subsections,
Sections, Schedules and Exhibits in or to this Agreement unless otherwise
specified; and the term "including" means "including without limitation." Unless
the context otherwise requires, terms used herein that are defined in the UCC
and not otherwise defined herein shall have the meanings set forth in the UCC.
[END OF ARTICLE I]
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ARTICLE II
TRUST ASSETS
Section 2.1. Conveyance of Trust Assets.
(a) By execution of this Agreement, each Transferor does
hereby transfer, assign, set over and otherwise convey to the Trust, without
recourse except as provided herein, all of its right, title and interest in, to
and under (i) the Receivables existing at the close of business on the Initial
Cut Off Date, in the case of Receivables arising in the Initial Accounts
(including Related Accounts with respect to such Initial Accounts), and
thereafter created from time to time in such Accounts until the termination of
the Trust, (ii) the Receivables existing at the close of business on each
applicable Addition Cut Off Date, in the case of Receivables arising in the
Additional Accounts (including Related Accounts with respect to such Additional
Accounts), and thereafter created from time to time in the Accounts until the
termination of the Trust, (iii) each Collateral Certificate as of each
applicable Addition Date, (iv) the Recoveries allocable to the Trust as provided
in this Agreement, (v) all monies due and to become due with respect to all of
the foregoing, (vi) all amounts received with respect to all of the foregoing
and (vii) all proceeds thereof, but excluding any Issuer Rate Fees allocable to
such Receivables. Each Transferor does hereby further transfer, assign, set over
and otherwise convey to the Trust all of its rights, remedies, powers,
privileges and claims under or with respect to any related Receivables Purchase
Agreement (whether arising pursuant to the terms of such Receivables Purchase
Agreement or otherwise). The property described in the two preceding sentences,
together with all monies and other property on deposit in or credited to the
Issuer Accounts established pursuant to this Agreement and each Indenture
Supplement, the rights of the Trust under this Agreement and the Trust Agreement
and the property conveyed to the Trust under this Agreement and any Series
Supplement shall constitute the assets of the Trust (the "Trust Assets"). The
foregoing does not constitute and is not intended to result in the creation or
assumption by the Trust, the Owner Trustee, the Indenture Trustee or any
Noteholder of any obligation of the Servicer, any Transferor, Credco, any
Account Owner or any other Person in connection with the Trust Assets or under
any agreement or instrument relating thereto, including any obligation to
Obligors, merchants clearance systems or insurers.
(b) Each Transferor agrees to record and file, at its own
expense, financing statements (and amendments to such financing statements when
applicable) with respect to the Trust Assets conveyed by such Transferor meeting
the requirements of applicable state law in such manner and in such
jurisdictions as are necessary to perfect, and maintain the perfection of, the
transfer, assignment, set-over or other conveyance of its interest in such Trust
Assets to the Trust, and to deliver a file-stamped copy of each such financing
statement or amendment or other evidence of such filing to the Owner Trustee and
the Indenture Trustee as soon as practicable after (i) the Execution Date, in
the case of Trust Assets relating to the Initial Accounts, and (ii) if any
additional filing is so necessary, the applicable Addition Date, in the case of
Trust Assets relating to Additional Accounts or Collateral Certificates. Neither
the Owner Trustee nor the Indenture Trustee shall be under any obligation
whatsoever to file such financing statements or amendments to financing
statements or to make any other filing under the UCC in connection with such
transfer, assignment, set-over or other conveyance.
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(c) Each Transferor further agrees, at its own expense, on or
prior to (i) the Execution Date, in the case of the Initial Accounts, (ii) the
applicable Addition Date, in the case of Additional Accounts or Collateral
Certificates and (iii) the applicable Removal Date, in the case of Removed
Accounts, with respect to such Transferor, to indicate in the appropriate
computer files that Receivables created (or reassigned, in the case of Removed
Accounts) in connection with such Accounts and such Collateral Certificates have
been conveyed to the Trust pursuant to this Agreement (or conveyed to such
Transferor or its designee in accordance with Section 2.14, in the case of
Removed Accounts) by including (or deleting, in the case of Removed Accounts) in
the securitization field of such computer files the code "AA" or "5," as
applicable, in the case of the Initial Accounts and, in the case of Additional
Accounts, a similar code designation that shall be specified in the Account
Assignment related thereto. Each Transferor further agrees not to alter the code
referenced in this paragraph with respect to any Account during the term of this
Agreement unless and until such Account becomes a Removed Account.
(d) Each Transferor further agrees, at its own expense, on or
prior to (a) the date that is five Business Days after the Execution Date, in
the case of the Initial Accounts, (b) the date that is five Business Days after
the applicable Addition Date, in the case of Aggregate Addition Accounts, (c)
the applicable New Account Delivery Date, in the case of New Accounts and (d)
the applicable Removal Date, in the case of Removed Accounts, to deliver to the
Issuer and the Indenture Trustee one or more computer files or microfiche lists
containing a true and complete list of all such Accounts, specifying for each
such Account, as of the Initial Cut Off Date, in the case of the Initial
Accounts, as of the applicable Addition Cut Off Date, in the case of Additional
Accounts, and as of the applicable Removal Date, in the case of Removed
Accounts, its account number and the aggregate amount outstanding in such
Account. Such computer files or microfiche lists also shall specify that the
Receivables arising in each such Account have been transferred to the Trust.
Each such file or list, as supplemented from time to time to reflect Related
Accounts, Additional Accounts and Removed Accounts, shall be marked as Schedule
1 to this Agreement and is hereby incorporated into and made a part of this
Agreement. Schedule 1 shall be updated not later than semiannually, beginning
October 2005, to include any new Related Accounts.
(e) Each Transferor further agrees, at its own expense, on or
prior to the date that is five Business Days after the applicable Addition Date,
in the case of Collateral Certificates, to deliver to the Issuer and the
Indenture Trustee one or more schedules containing a true and complete list of
all Collateral Certificates. Each such schedule, as supplemented from time to
time to reflect Collateral Certificates, shall be marked as Schedule 2 to this
Agreement and is hereby incorporated into and made a part of this Agreement.
Each Transferor further agrees (i) with respect to each Collateral Certificate
in certificated form, to cause the Issuer to acquire possession in the State of
New York or the State of Delaware of the related security certificate, endorsed
to the Issuer, or in blank by an effective endorsement, or registered in the
name of the Issuer upon original issue or registration of transfer by the issuer
of such Collateral Certificate, and (ii) with respect to each Collateral
Certificate in uncertificated form, to cause the issuer of such Collateral
Certificate to register the Issuer as the registered owner of such Collateral
Certificate.
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(f) To the extent that a Transferor retains any interest in
the Trust Assets, such Transferor hereby grants to the Trust and the Indenture
Trustee a first priority perfected security interest in all of such Transferor's
right, title and interest, whether now owned or hereafter acquired, in, to and
under the Trust Assets and all proceeds thereof, to secure such Transferor's
obligations hereunder. This Agreement shall constitute a security agreement
under applicable law.
Section 2.2. Acceptance by Issuer
(a) The Issuer hereby acknowledges its acceptance of all
right, title and interest to the Trust Assets conveyed to the Trust pursuant to
Section 2.1. The Issuer further acknowledges that, prior to or simultaneously
with the execution and delivery of this Agreement, the Transferor delivered to
the Issuer and the Indenture Trustee Schedule 1 identifying the Initial
Accounts.
(b) The Owner Trustee and the Trust each hereby agrees (and
the Indenture Trustee shall, pursuant to the Indenture, agree) not to disclose
to any Person any of the account numbers or other information contained in the
computer files or microfiche lists marked as Schedule 1 and delivered to the
Issuer and the Indenture Trustee from time to time except (i) to a Successor
Servicer or as required by a Requirement of Law applicable to the Owner Trustee
or the Trust, (ii) in connection with the performance of the Owner Trustee's or
the Trust's duties hereunder, (iii) to the Indenture Trustee in connection with
its duties in enforcing the rights of Noteholders and in connection with its
duties under this Agreement and the Indenture or (iv) to bona fide creditors or
potential creditors of any Account Owner or any Transferor for the limited
purpose of enabling any such creditor to identify Receivables or Accounts
subject to this Agreement or the Receivables Purchase Agreements. The Owner
Trustee and the Trust each agrees to take such measures as shall be reasonably
requested by any Account Owner or any Transferor to protect and maintain the
security and confidentiality of such information and, in connection therewith,
shall allow each Account Owner and each Transferor or their duly authorized
representatives to inspect the Owner Trustee's security, data protection and
confidentiality arrangements from time to time during normal business hours upon
prior written notice. The Owner Trustee and the Trust shall provide the
applicable Account Owner and the applicable Transferor with notice 15 Business
Days prior to disclosure of any information of the type described in this
subsection 2.2(b).
(c) The Owner 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 any Related Agreement.
Section 2.3. Representations and Warranties of Each Transferor
Relating to Such Transferor. Each Transferor hereby severally represents and
warrants to the Trust (and agrees that the Owner Trustee and the Indenture
Trustee may rely on each such representation and warranty in accepting the
Receivables and Collateral Certificates in trust under this Agreement or the
Indenture, as applicable, and in authenticating the Notes) as of the Execution
Date and each Issuance Date (but only if it was a Transferor on such date and
only if it was a party to the applicable Related Agreement on such date) that:
25
(a) Organization and Good Standing. Such Transferor is an
entity validly existing under the laws of the jurisdiction of its organization
or incorporation and has, in all material respects, full power and authority to
own its properties and conduct its business as presently owned or conducted, and
to execute, deliver and perform its obligations under this Agreement, each
applicable Receivables Purchase Agreement, if any, each applicable Pooling and
Servicing Agreement, if any, and each applicable Series Supplement, if any.
(b) Due Qualification. Such Transferor is duly qualified to do
business and is in good standing and has obtained all necessary licenses and
approvals, in each jurisdiction in which failure to so qualify or to obtain such
licenses and approvals would (i) render any Account Agreement relating to an
Account specified herein or any Receivable or any Collateral Certificate
conveyed by such Transferor to the Trust unenforceable by such Transferor, the
Servicer, the Indenture Trustee or the Owner Trustee and (ii) have a material
adverse effect on any Noteholders; provided, however, that no Transferor makes
any representation or warranty with respect to any qualifications, licenses or
approvals that the Indenture Trustee or the Owner Trustee would have to obtain
to do business in any state in which the Indenture Trustee or the Owner Trustee
seeks to enforce any Receivable or any Collateral Certificate.
(c) Due Authorization. The execution and delivery by such
Transferor of this Agreement, each applicable Receivables Purchase Agreement, if
any, each applicable Pooling and Servicing Agreement, if any, and each
applicable Series Supplement, if any, and the order to the Indenture Trustee to
have the Notes authenticated and delivered and the consummation by such
Transferor of the transactions provided for in this Agreement, each applicable
Receivables Purchase Agreement, if any, each applicable Pooling and Servicing
Agreement, if any, and each applicable Series Supplement, if any, have been duly
authorized by such Transferor by all necessary corporate action on the part of
such Transferor.
(d) No Conflict. The execution and delivery by such Transferor
of this Agreement, each applicable Receivables Purchase Agreement, if any, each
applicable Pooling and Servicing Agreement, if any, and each applicable Series
Supplement, if any, and the performance by such Transferor of the transactions
contemplated by this Agreement, each applicable Receivables Purchase Agreement,
if any, each applicable Pooling and Servicing Agreement, if any, and each
applicable Series Supplement, if any, and the fulfillment by such Transferor of
the terms hereof and thereof applicable to such Transferor, will not conflict
with or violate any Requirements of Law applicable to such Transferor or
conflict with, result in any breach of any of the material terms and provisions
of, or constitute (with or without notice or lapse of time or both) a material
default under, any indenture, contract, agreement, mortgage, deed of trust or
other instrument to which such Transferor is a party or by which it or its
properties are bound.
(e) No Proceedings. There are no proceedings or
investigations, pending or, to the best knowledge of such Transferor, threatened
against such Transferor before any Governmental Authority (i) asserting the
invalidity of this Agreement, any applicable Receivables Purchase Agreement, any
applicable Pooling and Servicing Agreement or any applicable Series Supplement,
(ii) seeking to prevent the consummation of any of the transactions contemplated
by this Agreement, any applicable Receivables Purchase Agreement, any applicable
Pooling and Servicing Agreement or any applicable Series Supplement, (iii)
seeking any determination or ruling that, in the reasonable judgment of such
Transferor, would materially and adversely affect the performance by such
Transferor of its obligations under this Agreement, any applicable Receivables
Purchase Agreement, any applicable Pooling and Servicing Agreement or any
applicable Series Supplement, (iv) seeking any determination or ruling that
would materially and adversely affect the validity or enforceability of this
Agreement, any applicable Receivables Purchase Agreement, any applicable Pooling
and Servicing Agreement or any applicable Series Supplement or (v) seeking to
affect adversely the income or franchise tax attributes of the Trust under the
United States federal or any state income or franchise tax systems.
26
(f) All Consents. All authorizations, consents, orders or
approvals of or registrations or declarations with any Governmental Authority
required to be obtained, effected or given by such Transferor in connection with
the execution and delivery by such Transferor of this Agreement, each applicable
Receivables Purchase Agreement, if any, each applicable Pooling and Servicing
Agreement, if any, and each applicable Series Supplement, if any, and the
performance of the transactions contemplated by this Agreement, each applicable
Receivables Purchase Agreement, if any, each applicable Pooling and Servicing
Agreement, if any, and each applicable Series Supplement, if any, by such
Transferor have been duly obtained, effected or given and are in full force and
effect.
Section 2.4. Representations and Warranties of Each
Transferor. Each Transferor hereby severally represents and warrants to the
Issuer, the Indenture Trustee and the Owner Trustee (but, in each case, only if
it was a Transferor on such date and only if it was a party to the applicable
Related Agreement on such date) that:
(a) as of the Execution Date and each Issuance Date, each of
this Agreement, each applicable Receivables Purchase Agreement, if any, each
applicable Pooling and Servicing Agreement, if any, and each applicable Series
Supplement, if any, constitutes a legal, valid and binding obligation of such
Transferor, enforceable against such Transferor in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally from time to time in effect or general principles of
equity.
(b) as of the applicable Addition Date with respect to
Additional Accounts, each of this Agreement and each applicable Receivables
Purchase Agreement, if any, constitutes a legal, valid and binding obligation of
such Transferor, enforceable against such Transferor in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally from time to time in effect or general principles of
equity;
(c) as of the applicable Addition Date with respect to
Additional Accounts, the related Account Assignment constitutes a legal, valid
and binding obligation of such Transferor, enforceable against such Transferor
in accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights generally from time to time in effect or
general principles of equity;
27
(d) as of the applicable Addition Date with respect to any
Collateral Certificate, each of this Agreement, any applicable Pooling and
Servicing Agreement, any applicable Series Supplement and the related
Certificate Assignment constitutes a legal, valid and binding obligation of such
Transferor, enforceable against such Transferor in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally from time to time in effect or general principles of
equity;
(e) as of each Increase Date, each of this Agreement, any
applicable Pooling and Servicing Agreement and any applicable Series Supplement,
constitutes a legal, valid and binding obligation of such Transferor,
enforceable against such Transferor in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally from time to time in effect or general principles of equity;
(f) (A) as of the Execution Date, with respect to the
Initial Accounts (and the Receivables arising therein), the portion of Schedule
1 to this Agreement under such Transferor's name, as supplemented to such date,
is, as of the Initial Cut Off Date, an accurate and complete listing in all
material respects of the Initial Accounts, the Receivables in which were
transferred by such Transferor as of the Execution Date;
(B) as of the applicable Addition Date, with respect
to Aggregate Addition Accounts (and the Receivables arising therein),
the portion of Schedule 1 to this Agreement under such Transferor's
name, as supplemented to such date, is, as of the related Addition Cut
Off Date, an accurate and complete listing in all material respects of
such Aggregate Addition Accounts, the Receivables in which were
transferred by such Transferor as of the applicable Addition Date;
(C) as of the applicable New Account Delivery Date,
with respect to New Accounts (and the Receivables arising therein), the
portion of Schedule 1 to this Agreement under such Transferor's name,
as supplemented to such date, is, as of the related Addition Cut Off
Date, an accurate and complete listing in all material respects of such
New Accounts, the Receivables in which were transferred by such
Transferor as of the applicable Addition Date; and
(D) as of the applicable Addition Date, with respect
to Collateral Certificates, the portion of Schedule 2 to this Agreement
under such Transferor's name, as supplemented to such date, is, as of
such Addition Date, an accurate and complete listing in all material
respects of each Collateral Certificate transferred to the Trust after
the Execution Date that remains outstanding, including any Collateral
Certificate transferred as of an Addition Date;
and, in each case, the information contained therein with respect to
the identity of such Accounts and the Receivables existing thereunder
as of the Initial Cut Off Date or such Addition Cut Off Date, as the
case may be, or with respect to the identity of such Collateral
Certificate as of such Addition Date, is, in each case, true and
correct in all material respects;
28
(g) as of the Execution Date, each Issuance Date and each
applicable Addition Date, the Receivables or the Collateral Certificates
conveyed by such Transferor to the Trust have been conveyed free and clear of
any Lien (other than as permitted by clause (iv) of the term "Eligible
Receivable");
(h) as of (A) the Execution Date, with respect to the Initial
Accounts (and the Receivables arising therein), (B) the applicable Addition
Date, with respect to Additional Accounts (and the Receivables arising therein),
(C) the applicable Addition Date, with respect to a Collateral Certificate and
(D) the applicable Increase Date, with respect to an increase in the Invested
Amount of an existing Collateral Certificate, all authorizations, consents,
orders or approvals of or registrations or declarations with any Governmental
Authority required to be obtained, effected or given by such Transferor in
connection with the conveyance by such Transferor of such Receivables or
Collateral Certificates or the increase of the Invested Amount of any existing
Collateral Certificate have been duly obtained, effected or given and are in
full force and effect;
(i) as of (A) the Execution Date, (B) each Issuance Date, (C)
the applicable Addition Date with respect to Additional Accounts (and the
Receivables arising therein), (D) the applicable Addition Date with respect to a
Collateral Certificate and (E) the applicable Increase Date with respect to an
increase in the Invested Amount of an existing Collateral Certificate, subject,
in each case pertaining to proceeds, to Section 9-315 of the UCC, and further
subject to any Liens permitted by clause (iv) of the term "Eligible Receivable,"
each of this Agreement, the related Account Assignment (in the case of
Additional Accounts) and the related Certificate Assignment (in the case of
Collateral Certificates) or any increased Invested Amount of an existing
Collateral Certificate (a) constitutes a valid transfer and assignment to the
Trust of all right, title and interest of such Transferor in the Receivables,
any additional Collateral Certificate or any increased Invested Amount of an
existing Collateral Certificate, as applicable, conveyed to the Trust by such
Transferor and the proceeds and Recoveries thereof, or (b) constitutes a grant
of a first-priority security interest (as defined in the applicable UCC) in such
property to the Trust, which security interest is prior to all other Liens, and
is enforceable as such against creditors of and purchasers from such Transferor
and which, in the case of existing Receivables and the proceeds and Recoveries
thereof, is enforceable upon execution and delivery of this Agreement, or with
respect to then existing Receivables in Additional Accounts or additional
Collateral Certificates, as of the applicable Addition Date, or, with respect to
any increased Invested Amount of an existing Collateral Certificate, as of the
applicable Increase Date, and which will be enforceable with respect to such
Receivables hereafter and thereafter created and the proceeds and Recoveries
thereof upon such creation;
(j) as of (A) the Execution Date with respect to the Initial
Accounts (and the Receivables arising therein), (B) the applicable Addition Date
with respect to Aggregate Addition Accounts (and the Receivables arising
therein), (C) the applicable Addition Date with respect to a Collateral
Certificate and (D) the applicable Increase Date with respect to an increase in
the Invested Amount of an existing Collateral Certificate, such Transferor has
caused or will have caused within ten days, the filing of all appropriate
financing statements in the proper filing office in the appropriate
jurisdictions under applicable law in order to perfect the security interest in
such property granted to the Issuer under this Agreement and upon the filing of
all such appropriate financing statements, the Issuer will have a first priority
perfected security or ownership interest in such property and proceeds;
29
(k) as of (A) the Execution Date with respect to the Initial
Accounts (and the Receivables arising therein), (B) the applicable Addition Date
with respect to Additional Accounts (and the Receivables arising therein), (C)
the applicable Addition Date with respect to a Collateral Certificate and (D)
the applicable Increase Date with respect to an increase in the Invested Amount
of an existing Collateral Certificate, other than the security interest granted
to the Trust pursuant to this Agreement or any other security interest that has
been terminated, such Transferor has not pledged, assigned, sold, granted a
security interest in, or otherwise conveyed such property; such Transferor has
not authorized the filing of and is not aware of any financing statements
against such Transferor that include a description of collateral covering such
property other than any financing statement relating to the security interest
granted to the Trust hereunder or that has been terminated; and such Transferor
is not aware of any judgment or tax lien filings against such Transferor;
(l) as of (A) the applicable Increase Date with respect to an
existing Collateral Certificate which is to have its Invested Amount increased
on such date and (B) each Addition Date with respect to a Collateral
Certificate, such existing Collateral Certificate or additional Collateral
Certificate, as applicable, constitutes a "certificated security," an
"uncertificated security," an "instrument," an "account" or a "general
intangible," in each case within the meaning of the applicable UCC; such
Transferor has in its possession all original copies of each certificate that
constitutes or evidences such existing Collateral Certificate or additional
Collateral Certificate, as applicable; the certificates that constitute or
evidence such existing Collateral Certificate or additional Collateral
Certificate do not have any marks or notations indicating that they have been
pledged, assigned or otherwise conveyed to any Person other than the Trust; and
all financing statements filed or to be filed against such Transferor in favor
of the Trust in connection herewith describing such existing Collateral
Certificate or additional Collateral Certificate, as applicable, contain a
statement to the following effect: "A purchase of or security interest in any
collateral described in this financing statement will violate the rights of the
Trust";
(m) as of the applicable Addition Date with respect to a
Collateral Certificate, such Collateral Certificate is an Eligible Collateral
Certificate;
(n) as of the applicable Selection Date, each Initial Account
and each applicable Additional Account is an Eligible Account;
(o) as of (A) the applicable Selection Date with respect to
each Receivable contained in the Initial Accounts conveyed to the Trust by such
Transferor on the Execution Date, (B) the applicable Selection Date with respect
to each Receivable contained in the related Additional Accounts to be conveyed
to the Trust by such Transferor on such Addition Date and (C) each Issuance Date
with respect to all Receivables contained in Accounts which have been conveyed
to the Trust by such Transferor and each new Receivable subsequently conveyed to
the Trust by such Transferor, such Receivable constitutes an "account" or a
"general intangible" within the meaning of the applicable UCC;
30
(p) as of (A) the Selection Date with respect to each
Receivable contained in the Initial Accounts conveyed to the Trust by such
Transferor on the Execution Date, (B) the applicable Selection Date with respect
to each Receivable contained in the related Additional Accounts to be conveyed
to the Trust by such Transferor on the applicable Addition Date and (C) the date
of the creation of any new Receivable conveyed to the Trust by such Transferor,
such Receivable is an Eligible Receivable;
(q) as of (A) the Execution Date with respect to the Initial
Accounts and (B) the applicable Addition Date with respect to Additional
Accounts, no selection procedures believed by such Transferor to be materially
adverse to the interests of the Noteholders have been used in selecting the
Initial Accounts or any Additional Accounts, as applicable; and
(r) on each applicable Increase Date, the existing Collateral
Certificate which is to have its Invested Amount increased is an Eligible
Collateral Certificate.
Section 2.5. Notice of Breach. The representations and
warranties set forth in Section 2.3 and Section 2.4 shall survive the transfers
and assignments of the Trust Assets to the Trust, the pledge of the Receivables
and the Collateral Certificates to the Indenture Trustee pursuant to the
Indenture, and the issuance of the Notes. Upon discovery by any Transferor, the
Servicer, the Indenture Trustee or the Owner Trustee of a breach of any of the
representations and warranties set forth in Section 2.3 or Section 2.4, the
party discovering such breach shall give prompt written notice to the other
parties following such discovery.
Section 2.6. Transfer of Ineligible Receivables and Ineligible
Collateral Certificates.
(a) Reassignment of Collateral. In the event (i) any
representation or warranty contained in subsection 2.4(f), (g), (h), (m), (n),
(o), (p), (q) or (r) of this Agreement is not true and correct in any material
respect as of the date specified therein with respect to any Receivable, any
Collateral Certificate or the related Account and such breach has a material
adverse effect on any Noteholders unless cured within 60 days (or such longer
period, not in excess of 120 days, as may be agreed to by the Indenture Trustee
and the Servicer) after the earlier to occur of the discovery thereof by the
Transferor that conveyed such Receivable or Collateral Certificate to the Trust
or receipt by such Transferor of written notice thereof given by the Indenture
Trustee, the Owner Trustee or the Servicer, or (ii) it is so provided in
subsection 2.9(a) with respect to any Receivables conveyed to the Trust by such
Transferor, then such Transferor shall accept reassignment of the Ineligible
Receivables or the Ineligible Collateral Certificates on the terms and
conditions set forth in paragraph (b) below.
(b) Procedures for Removal. When the provisions of subsection
2.6(a) above require (i) the removal of a Receivable, the applicable Transferor
shall accept reassignment of such Receivable (each such Receivable, an
"Ineligible Receivable") by directing the Servicer to deduct the principal
balance of each such Ineligible Receivable from the Pool Balance and to decrease
the Transferor Amount by the principal balance of such Ineligible Receivable or
(ii) the removal of a Collateral Certificate, the Indenture Trustee and the
Issuer shall deliver such Collateral Certificate (each such Collateral
Certificate, an "Ineligible Collateral Certificate") to the applicable
Transferor with a valid assignment in the name of such Transferor and direct the
Servicer to deduct the Invested Amount of each such Ineligible Collateral
Certificate from the Pool Balance and to decrease the Transferor Amount by the
Invested Amount of each such Ineligible Collateral Certificate. On and after the
date of such removal, the principal balance of each Ineligible Receivable and
the Invested Amount of each Ineligible Collateral Certificate shall be deducted
from the Pool Balance and the Transferor Amount. In the event that the exclusion
of an Ineligible Receivable or an Ineligible Collateral Certificate from the
calculation of the Transferor Amount and the Pool Balance would cause the
Transferor Amount to be reduced below the Required Transferor Amount or the Pool
Balance to be reduced below the Required Pool Balance, the Transferor who
conveyed such Ineligible Receivable or Ineligible Collateral Certificate shall
immediately, but in no event later than 1:00 p.m., New York City time, on the
first Payment Date following the Monthly Period in which such reassignment
obligation arises, make a deposit in the Excess Funding Account in immediately
available funds in an amount equal to the greater of the amount by which (x) the
Transferor Amount would be reduced below the Required Transferor Amount or (y)
the Pool Balance would be reduced below the Required Pool Balance.
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Upon reassignment of any Ineligible Receivable or Ineligible
Collateral Certificate, the Indenture Trustee and the Trust shall automatically
and without further action transfer, assign, set-over and otherwise convey to
the applicable Transferor or its designee, without recourse, representation or
warranty, all the right, title and interest of the Indenture Trustee and the
Trust in and to such Ineligible Receivable or Ineligible Collateral Certificate,
all Recoveries related thereto, all monies and amounts due or to become due and
all proceeds thereof and such reassigned Ineligible Receivable or Ineligible
Collateral Certificate shall be treated by the Indenture Trustee and the Trust
as collected in full as of the date on which it was reassigned. The obligation
of each Transferor to accept reassignment of any Ineligible Receivable or
Ineligible Collateral Certificate conveyed to the Trust by such Transferor, and
to make the deposits, if any, required to be made to the Excess Funding Account
as provided in this Section 2.6, shall constitute the sole remedy respecting the
event giving rise to such obligation available to the Trust or the Noteholders
(or the Indenture Trustee on behalf of the Noteholders). The Trust shall execute
such documents and instruments of transfer or assignment and take such other
actions as shall reasonably be requested and provided by the applicable
Transferor to effect the conveyance of such Ineligible Receivable or Ineligible
Collateral Certificate pursuant to this subsection 2.6(b), but only upon receipt
of an Officer's Certificate from such Transferor that states that all conditions
set forth in this Section 2.6 have been satisfied.
Section 2.7. Reassignment of Trust Assets. (a) In the event
any representation or warranty of a Transferor set forth in subsection 2.3(a) or
(c) or subsection 2.4(a), (b), (c), (d), (e) or (i) of this Agreement is not
true and correct in any material respect and such breach has a material adverse
effect on the Receivables or a particular Collateral Certificate conveyed to the
Trust by such Transferor or the availability of the proceeds thereof to the
Trust then, either the Owner Trustee, the Indenture Trustee or Noteholders
evidencing more than 50% of the aggregate unpaid principal amount of all
Outstanding Notes, by notice then given to the applicable Transferor, the
Administrator and the Servicer (and to the Owner Trustee and the Indenture
Trustee, if given by the Noteholders), may direct such Transferor to accept a
reassignment of the Receivables and/or any such Collateral Certificate conveyed
to the Trust by such Transferor pursuant to this Agreement, if such breach and
any material adverse effect caused by such breach is not cured within 60 days of
such notice (or within such longer period as may be specified in such notice),
and upon those conditions such Transferor shall be obligated to accept such
reassignment on the terms set forth below; provided, however, that the affected
Receivables and the affected Collateral Certificates will not be reassigned to
such Transferor if, on any day during such applicable period the relevant
representation and warranty shall be true and correct in all material respects
as if made on such day. The applicable Transferor shall deposit the portion of
the Reassignment Amount attributable to the applicable Receivables and
Collateral Certificates in the Collection Account to be treated (i) in
connection with amounts determined under clause (a) of the definition of
"Reassignment Amount," as Principal Collections for each Series of Notes and
(ii) in connection with the amounts determined under clause (b) of the
definition of "Reassignment Amount," as Finance Charge Collections for each
Series of Notes, in either case, in immediately available funds not later than
1:00 p.m., New York City time, on the First Note Transfer Date following the
Monthly Period in which such reassignment obligation arises, in payment for such
reassignment.
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(b) If the Owner Trustee, the Indenture Trustee or the
Noteholders give notice directing the applicable Transferor to accept a
reassignment of any Receivables or any Collateral Certificate as provided above,
the obligation of such Transferor to accept such reassignment pursuant to this
Section 2.7 and to make the deposit required to be made to the Collection
Account for each Series of Notes as provided in this Section 2.7 shall
constitute the sole remedy respecting an event of the type specified above in
this Section 2.7 available to the Noteholders (or the Indenture Trustee on
behalf of the Noteholders). Upon reassignment of the affected Receivables and
any affected Collateral Certificate on the First Note Transfer Date following
the Monthly Period in which such obligation arises, the Indenture Trustee and
the Trust shall automatically and without further action transfer, assign,
set-over and otherwise convey to the applicable Transferor, without recourse,
representation or warranty, all the right, title and interest of the Indenture
Trustee and the Trust in and to the affected Receivables and affected Collateral
Certificates, all Recoveries allocable thereto, all monies and amounts due or to
become due with respect thereto and all proceeds thereof (and any costs or
expenses incurred by the Indenture Trustee in connection with such reassignment
shall be reimbursed by the applicable Transferor). The Indenture Trustee and the
Trust shall execute such documents and instruments of transfer or assignment and
take such other actions as shall reasonably be requested by the applicable
Transferor to effect the conveyance of such property pursuant to this
Section 2.7.
Section 2.8. Additional Transferors. The Transferor may
designate Affiliates of the Transferor to be included as Transferors (each, an
"Additional Transferor") under this Agreement in an amendment hereto pursuant to
subsection 12.1(a) and, in connection with such designation, such Transferor
shall (i) if the Transferor Interest is evidenced in uncertificated form, direct
the Owner Trustee to register in the books and records of the Trust such
Additional Transferor's interest in the Transferor Interest or (ii) if the
Transferor Interest is evidenced in certificated form, surrender such
certificate to the Owner Trustee in exchange for a newly issued certificate
modified to reflect such Additional Transferor's interest in the Transferor
Interest; provided, however, that each Additional Transferor shall agree in such
amendment hereto to assume all of the duties and obligations of a Transferor
hereunder; and provided further that prior to any such designation and exchange,
(i) the Owner Trustee shall have received an Issuer Tax Opinion, (ii) the Note
Rating Agency Condition shall have been satisfied, (iii) the Master Trust
Trustee shall have received the Master Trust Tax Opinion, if applicable, and
(iv) any additional conditions to the transfer of a Beneficial Interest provided
in Section 3.02 of the Trust Agreement shall have been satisfied.
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Section 2.9. Covenants of Each Transferor. Each Transferor
hereby severally covenants that:
(a) Receivables Not To Be Evidenced by Promissory Notes.
Except in connection with its enforcement or collection of an Account, such
Transferor will take no action to cause any Receivable conveyed by it to the
Trust to be evidenced by any instrument (as defined in the UCC) and, if any such
Receivable is so evidenced as a result of any action taken by such Transferor,
it shall be deemed to be an Ineligible Receivable in accordance with subsection
2.7(a) and shall be reassigned to such Transferor in accordance with subsection
2.7(b).
(b) Security Interests. Except for the conveyances hereunder,
such Transferor will not sell, pledge, assign or transfer to any other Person,
or grant, create, incur, assume or suffer to exist any Lien (except as permitted
by clause (iv) of the definition of the term "Eligible Receivable") on any
Receivable or Collateral Certificate conveyed by it to the Trust whether now
existing or hereafter created, or any interest therein; and such Transferor
shall defend the right, title and interest of the Trust and the Indenture
Trustee in, to and under the Receivables and any Collateral Certificate, whether
now existing or hereafter created, against all claims of third parties claiming
through or under such Transferor.
(c) Transferor Interest. Except for (i) the conveyances
hereunder, in connection with any transaction permitted by subsection 6.2(a)(i)
and as provided in Section 2.8 of this Agreement and Section 4.04 of the Trust
Agreement or (ii) conveyances with respect to which the Note Rating Agency
Condition shall have been satisfied and an Issuer Tax Opinion shall have been
delivered to the Indenture Trustee and the Owner Trustee, such Transferor
agrees, to the fullest extent permitted by applicable law, not to transfer,
sell, assign, exchange or otherwise convey or pledge, hypothecate or otherwise
grant a security interest in the Transferor Interest and any such attempted
transfer, assignment, exchange, conveyance, pledge, hypothecation, grant or sale
shall be void. Nothing contained in this subsection 2.9(c) shall be interpreted
to prohibit or in any way limit any Transferor's ability to grant to another
Person a participation interest in the Transferor Interest upon the delivery to
the Indenture Trustee and the Owner Trustee of an Issuer Tax Opinion; provided
that any transfer by a Transferor of all or any part of its right, title and
interest in and to the Transferor Interest to Credco will not require delivery
of an Issuer Tax Opinion.
(d) Delivery of Collections or Recoveries. In the event that
such Transferor receives Collections or Recoveries, such Transferor agrees to
pay the Servicer all such Collections and Recoveries as soon as practicable
after receipt thereof.
(e) Notice of Liens. Such Transferor shall notify the Owner
Trustee and the Indenture Trustee promptly after becoming aware of any Lien
(except as permitted by clause (iv) of the definition of the term "Eligible
Receivable") on any Receivable or Collateral Certificate conveyed by it to the
Trust other than the conveyances hereunder and under the Indenture.
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(f) Account Agreements and Guidelines. Each Transferor that is
an Account Owner covenants that it shall comply with and perform its obligations
under the Account Agreements relating to the Accounts and the Account Guidelines
and all applicable rules and regulations of such Transferor except insofar as
any failure to comply or perform would not materially and adversely affect the
rights of the Trust or the Noteholders; provided, however, the applicable
Transferor may change the terms and provisions of the applicable Account
Agreements or the applicable Account Guidelines in any respect (including the
calculation of the amount, or the timing, of charge-offs and other fees to be
assessed thereon) only if such change (i) would not, in the reasonable belief of
such applicable Transferor, cause an Early Amortization Event or Event of
Default to occur, and (ii) is made applicable to any comparable segment of the
charge accounts owned by such applicable Transferor which have characteristics
the same as, or substantially similar to, the Accounts that are the subject of
such change, except as otherwise restricted by an endorsement, sponsorship, or
other agreement between such applicable Transferor and an unrelated third party
or by the terms of the Account Agreements.
(g) Separate Corporate Existence. Each Transferor that is a
securitization special purpose entity shall:
(i) Maintain in full effect its existence, rights and
franchises as a limited liability company under the laws of the state
of its formation or as a corporation under the laws of the state of its
incorporation and will obtain and preserve its qualification to do
business in each jurisdiction in which such qualification is or shall
be necessary to protect the validity and enforceability of this
Agreement and the applicable Receivables Purchase Agreement and each
other instrument or agreement necessary or appropriate to proper
administration hereof and to permit and effectuate the transactions
contemplated hereby.
(ii) Except as provided in this Agreement, maintain its
own deposit, securities and other account or accounts, separate from
those of any Affiliate of such Transferor, with financial institutions.
The funds of such Transferor will not be diverted to any other Person
or for other than the company use of such Transferor, and, except as
may be expressly permitted by this Agreement or the applicable
Receivables Purchase Agreement, the funds of such Transferor shall not
be commingled with those of any other Person.
(iii) Ensure that, to the extent that it shares the same
officers or other employees as any of its members or other 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.
(iv) Ensure that, to the extent that it jointly contracts
with any of its members or other 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
such Transferor 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
and services are provided, and each such entity shall bear its fair
share of such costs.
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(v) Ensure that all material transactions between such
Transferor and any of its Affiliates shall be only on an arm's-length
basis and shall not be on terms more favorable to either party than the
terms that would be found in a similar transaction involving unrelated
third parties.
(vi) Maintain a principal executive and administrative
office through which its business is conducted and a telephone number
separate from those of its members and other Affiliates. To the extent
that such Transferor and any of its members or other Affiliates have
offices in contiguous space, there shall be fair and appropriate
allocation of overhead costs (including rent) among them, and each such
entity shall bear its fair share of such expenses.
(vii) Conduct its affairs strictly in accordance with its
certificate of formation and limited liability company agreement or its
certificate of incorporation and bylaws and observe all necessary,
appropriate and customary company formalities, including, but not
limited to, holding all regular and special members' and directors'
meetings appropriate to authorize all action, keeping separate and
accurate minutes of such 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, intercompany transaction accounts. Regular members' and
directors' meetings shall be held at least annually.
(viii) Ensure that its board of directors shall at all
times include at least one Independent Director (for purposes hereof,
"Independent Director" shall mean any member of the board of directors
of such Transferor that is not and has not at any time been (x) an
officer, agent, advisor, consultant, attorney, accountant, employee,
member or shareholder of any Affiliate of such Transferor which is not
a special purpose entity, (y) a director of any Affiliate of such
Transferor other than an independent director of any Affiliate which is
a special purpose entity or (z) a member of the immediate family of any
of the foregoing).
(ix) Ensure that decisions with respect to its business
and daily operations shall be independently made by such Transferor
(although the officer making any particular decision may also be an
officer or director of an Affiliate of such Transferor) and shall not
be dictated by an Affiliate of such Transferor.
(x) Act solely in its own company name and through its own
authorized officers and agents, and no Affiliate of such Transferor
shall be appointed to act as agent of such Transferor. Such Transferor
shall at all times use its own stationery and business forms and
describe itself as a separate legal entity.
(xi) Other than as provided in the relevant Revolving
Credit Agreement, ensure that no Affiliate of such Transferor shall
advance funds or loan money to such Transferor, and no Affiliate of
such Transferor will otherwise guaranty debts of such Transferor.
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(xii) Other than organizational expenses and as expressly
provided herein, pay all expenses, indebtedness and other obligations
incurred by it using its own funds.
(xiii) Not enter into any guaranty, or otherwise become
liable, with respect to or hold its assets or creditworthiness out as
being available for the payment of any obligation of any Affiliate of
such Transferor nor shall such Transferor make any loans to any Person.
(xiv) Ensure that any financial reports required of such
Transferor shall comply with generally accepted accounting principles
and shall be issued separately from, but may be consolidated with, any
reports prepared for any of its Affiliates so long as such consolidated
reports contain footnotes describing the effect of the transactions
between such Transferor and such Affiliate and also state that the
assets of such Transferor are not available to pay creditors of the
Affiliate.
(xv) Ensure that at all times it is adequately capitalized
to engage in the transactions contemplated in its certificate of
formation and its limited liability company agreement or in its
certificate of incorporation and bylaws.
Section 2.10. Covenants of Each Transferor With Respect to Any
Applicable Receivables Purchase Agreement. Each Transferor, if such Transferor
is a party to a Receivables Purchase Agreement, in its capacity as purchaser of
Receivables from any Account Owner pursuant to any such Receivables Purchase
Agreement, hereby covenants that such Transferor will at all times enforce the
covenants and agreements of any Account Owner in such Receivables Purchase
Agreement, including covenants that the Account Owner shall at all times enforce
the covenants and agreements of it, as the case may be, in any Receivables
Purchase Agreement. Each Transferor further covenants that it will not enter
into any amendment to any Receivables Purchase Agreement to which it is a party,
or enter into a new Receivables Purchase Agreement unless the Note Rating Agency
Condition shall have been satisfied.
Section 2.11. Reinvestment in Trust Assets. (a) On each First
Note Transfer Date, the Reinvestment Amount for the immediately preceding
Monthly Period shall be applied in the following order of priority:
(i) if the Trust Assets include one or more Collateral
Certificates, the Transferor, on behalf of the Issuer, shall specify the amount
of the Reinvestment Amount to be reinvested in each existing Collateral
Certificate, which amount shall be determined by the Transferor, on behalf of
the Issuer, in its own discretion, and no such reinvestment shall be required;
provided, however, that, subject to the restrictions specified in subsection
2.12(c), the Transferor, on behalf of the Issuer, shall be required to increase
the Invested Amount of an existing Collateral Certificate if Trust Assets are
required to be added pursuant to subsection 2.13(a) and the Transferor elects to
cause to be increased the Invested Amount of one or more existing Collateral
Certificates as specified in such Section (so long as the applicable Series
Supplement allows such reinvestment and the transferor or seller for the related
Master Trust agrees to such reinvestment); and
37
(ii) the remainder of such amounts shall be paid to the
holders of the Transferor Interest; provided, however, that if the Commercial
Obligor Overconcentration Amount is greater than zero (after giving effect to
any additions to or removals from the Trust on or prior to such date), the
excess, if any, of the Required Overconcentration Account Amount with respect to
such Monthly Period over the Available Overconcentration Account Amount with
respect to such Monthly Period shall be deposited by the Servicer into the
Overconcentration Account; and provided further, however, that if the Transferor
Amount for the prior Monthly Period did not equal or exceed the Required
Transferor Amount for the prior Monthly Period or the Pool Balance for such
prior Monthly Period did not equal or exceed the Required Pool Balance for such
prior Monthly Period (after taking into consideration the application of the
Reinvestment Amount, if any, pursuant to this Section 2.11 and after giving
effect to any deposits made or to be made to the Overconcentration Account with
respect to such date), the lesser of (i) such remaining amount and (ii) the
greater of the amount by which (x) the Required Transferor Amount is greater
than the Transferor Amount or (y) the Required Pool Balance is greater than the
Pool Balance, in each case with respect to such prior Monthly Period, shall be
deposited by the Servicer into the Excess Funding Account.
(b) Pursuant to this Agreement, each Receivable shall be
transferred to the Trust and pledged to secure the Notes on the day that such
Receivable arises.
Section 2.12. Increases in the Invested Amount of an Existing
Collateral Certificate.
(a) In addition to the increases described in Section 2.11
above, the applicable Transferor may cause to be increased the Invested Amount
of any existing Collateral Certificate on any Business Day in connection with:
(i) the issuance of an additional Series, Class or
Tranche of Notes; or
(ii) the increase of the Transferor Amount.
(b) In connection with any increase in the Invested Amount of
an existing Collateral Certificate, such increase shall either be funded from
the proceeds of the issuance of an additional Series, Class or Tranche of Notes
or be funded by the applicable Transferor.
(c) Notwithstanding any other provision of this Agreement,
with respect to any Monthly Period, the Invested Amount of an existing
Collateral Certificate shall not be increased, including increases pursuant to
Section 2.11 and this Section 2.12, if (i) an Early Amortization Event shall
have occurred with respect to any Notes as a result of a failure to add
Receivables and/or Collateral Certificates to the Trust or a failure to increase
the Invested Amount of an existing Collateral Certificate at a time when the
Pool Balance for the prior Monthly Period is less than the Required Pool Balance
for such prior Monthly Period and (ii) increasing the Invested Amount of or
reinvesting in an existing Collateral Certificate would result in a reduction in
the allocation percentage applicable for principal collections for such existing
Collateral Certificate.
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Section 2.13. Addition of Trust Assets.
(a) Required Additions.
(i) If, at the end of any Monthly Period, (a) the
Transferor Amount for such Monthly Period and for the prior Monthly
Period is less than the Required Transferor Amount for each such
Monthly Period or (b) the Pool Balance for such Monthly Period is less
than the Required Pool Balance for such Monthly Period, the Transferor
shall (1) transfer Receivables in Aggregate Addition Accounts to the
Trust, (2) transfer one or more Collateral Certificates to the Trust or
(3) cause to be increased the Invested Amount of one or more existing
Collateral Certificates pursuant to Section 2.11 or Section 2.12 in a
sufficient amount such that, after giving effect to such addition or
increase, the Transferor Amount for such Monthly Period is at least
equal to the Required Transferor Amount for such Monthly Period and the
Pool Balance is at least equal to the Required Pool Balance for such
Monthly Period.
Any transfer of Receivables in any Aggregate Addition
Accounts to the Trust and/or any transfer of Collateral Certificates to
the Trust and/or any increase in the Invested Amount of one or more
existing Collateral Certificates shall occur on or before the thirtieth
Business Day following the end of such Monthly Period. The failure of
the Transferor to increase the Transferor Amount or the Pool Balance as
provided in this clause (i) solely as a result of the unavailability to
the Transferor of a sufficient amount of Receivables and/or Collateral
Certificates and/or the inability to cause to be increased the Invested
Amount of one or more existing Collateral Certificates shall not
constitute a breach of this Agreement; provided that any such failure
which has not been timely cured (as specified in the related Indenture
Supplement) may nevertheless result in the occurrence of an Early
Amortization Event with respect to each Series for which, pursuant to
the Indenture Supplement therefor, a failure by the Transferor to
convey additional Trust Assets to the Trust or cause to be increased
the Invested Amount of an existing Collateral Certificate by the day on
which it is required to do so pursuant to this subsection 2.13(a)
constitutes an "Early Amortization Event" (as defined in such Indenture
Supplement).
(ii) Any Aggregate Addition Accounts or Collateral
Certificates designated to be included as part of the Trust Assets
pursuant to clause (i) above may only be so included if the applicable
conditions specified in subsection (c) below have been satisfied.
(b) Permitted Aggregate Additions, Additional Collateral
Certificates and Increases in the Invested Amount of Existing Collateral
Certificates. In addition to its obligation under subsection 2.13(a), each
Transferor may, but shall not be obligated to, subject to the conditions in
paragraph (c) below, (i) cause to be designated from time to time Receivables in
Aggregate Addition Accounts to be included as part of the Trust Assets and/or
additional Collateral Certificates to be included as part of the Trust Assets
and (ii) cause to be increased the Invested Amount of an existing Collateral
Certificate. Such additional Trust Assets shall be transferred to the Trust on
the Addition Date or the Increase Date, as applicable.
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(c) Conditions to Aggregate Additions and Additional
Collateral Certificates. On each Addition Date with respect to any Aggregate
Addition Accounts and/or additional Collateral Certificates, the applicable
Receivables in Aggregate Addition Accounts (and such Aggregate Addition Accounts
shall be Accounts for purposes of this Agreement) or the applicable Collateral
Certificate shall be designated as additional Trust Assets, subject to the
satisfaction of the following conditions (which shall not apply with respect to
any increase in the Invested Amount of any existing Collateral Certificate
except as specified in clause (i) below):
(i) on or before the eighth Business Day prior to the
Addition Date or Increase Date, as applicable (the "Notice Date"), the
applicable Transferor shall have delivered to the Owner Trustee, the
Indenture Trustee, the Servicer, the other Transferors, if any, and
each Note Rating Agency written notice (unless such notice requirement
is otherwise waived) that the Receivables in Aggregate Addition
Accounts and/or additional Collateral Certificates will be transferred
to the Trust or an increased Invested Amount of an existing Collateral
Certificate will be included as part of the Trust Assets (the latter
notice requirement shall only apply to increases made pursuant to
subsection 2.13(a); provided, however, that notice shall be delivered
to the Owner Trustee and the Indenture Trustee in connection with any
increase in the Invested Amount of an existing Collateral Certificate),
which notice shall specify, as applicable, (x) the approximate
aggregate amount of the Principal Receivables to be transferred to the
Trust (y) the Invested Amount of the additional Collateral Certificates
to be transferred to the Trust and (z) the amount by which the Invested
Amount of an existing Collateral Certificate is to be increased, as
well as the applicable Addition Date or Increase Date and, in
connection with the Aggregate Addition Accounts, the applicable
Addition Cut Off Date and Selection Date;
(ii) the applicable Transferor shall represent and warrant
that, as of the applicable Selection Date, each Aggregate Addition
Account is an Eligible Account;
(iii) the applicable Transferor shall represent and
warrant as of the applicable Addition Date, each additional Collateral
Certificate is an Eligible Collateral Certificate;
(iv) the applicable Transferor shall have delivered to the
Owner Trustee and the Indenture Trustee copies of UCC financing
statements covering the Receivables in such Aggregate Addition Accounts
and/or additional Collateral Certificates, if necessary to perfect the
interest of the Trust therein;
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(v) to the extent required by Section 3.1, the applicable
Transferor shall have deposited into the Collection Account all
Collections with respect to such (a) Aggregate Addition Accounts since
the applicable Addition Cut Off Date or (b) additional Collateral
Certificates as of such Addition Date;
(vi) as of each of the Addition Cut Off Date and the
Addition Date, no Insolvency Event shall have occurred nor shall the
transfer to the Trust of the Receivables arising in the Aggregate
Addition Accounts have been made in contemplation of the occurrence
thereof;
(vii) as of the Addition Date, no Insolvency Event shall
have occurred nor shall the transfer to the Trust of the additional
Collateral Certificates have been made in contemplation of the
occurrence thereof;
(viii) on or before the Addition Date with respect to
Aggregate Addition Accounts and the Receivables arising thereunder, the
applicable Transferor shall have delivered to the Owner Trustee, on
behalf of the Trust, and the Servicer a written assignment in
substantially the form of Exhibit A (the "Aggregate Addition Account
Assignment"), and the applicable Transferor shall deliver or cause to
be delivered to the Issuer and the Indenture Trustee the computer file
or microfiche list required to be delivered pursuant to Section 2.1 on
the date such file or list is required to be delivered pursuant
thereto, which file or list shall be incorporated into and made a part
of such Aggregate Addition Account Assignment and this Agreement;
(ix) on or before the Addition Date with respect to
Collateral Certificates, the applicable Transferor shall have delivered
to the Owner Trustee, on behalf of the Trust, and the Servicer a
written assignment in substantially the form of Exhibit B (the
"Certificate Assignment") and each Collateral Certificate shall be
delivered and registered in the name of the Trust, and the applicable
Transferor shall deliver or cause to be delivered to the Issuer and the
Indenture Trustee the schedule required to be delivered pursuant to
Section 2.1 on the date such file or list is required to be delivered
pursuant thereto, which file or list shall be incorporated into and
made a part of such Certificate Assignment and this Agreement;
(x) the addition to the Trust of the Receivables arising
in the Aggregate Addition Accounts or of the Collateral Certificates
shall not, in the reasonable belief of the applicable Transferor,
result in an Adverse Effect or in the Commercial Obligor
Overconcentration Amount exceeding zero;
(xi) if prior to the applicable Addition Date, with
respect to any three consecutive Monthly Periods or with respect to any
twelve consecutive Monthly Periods, the Addition Limit shall have been
exceeded, the Transferor shall have received notice from each Note
Rating Agency that the addition pursuant to subsection 2.13(b) of such
Aggregate Addition Accounts in excess of the Addition Limit will not
result in the reduction or withdrawal of its then existing rating of
any Series, Class or Tranche of Notes then issued and Outstanding and
shall have delivered such notice to the Owner Trustee and the Indenture
Trustee, and the Transferor shall have delivered to each Note Rating
Agency an Opinion of Counsel, dated the Addition Date, in accordance
with subsection 12.2(d);
(xii) with respect to the addition of additional
Collateral Certificates, the Transferor shall have received notice from
each Note Rating Agency on or prior to the applicable Addition Date
that the Note Rating Agency Condition shall have been satisfied with
respect to such Note Rating Agency and shall have delivered such notice
to the Owner Trustee and the Indenture Trustee;
41
(xiii) the Transferor shall have delivered to the Owner
Trustee and the Indenture Trustee an Officer's Certificate of the
Transferor, dated the Addition Date, confirming, to the extent
applicable, the items set forth in clauses (ii) through (vii) and
clause (x) above; and
(xiv) the Transferor shall have delivered to the Owner
Trustee and the Indenture Trustee an Opinion of Counsel, dated the
Addition Date, in accordance with subsection 12.2(d).
(d) New Accounts. Each Transferor may, from time to time, at
its sole discretion, subject to the conditions specified in paragraph (e) below,
voluntarily designate newly originated Eligible Accounts to be included as New
Accounts. For purposes of this paragraph, Eligible Accounts shall be deemed to
include only charge accounts of the same nature as those included as Initial
Accounts or which have previously been included in any Aggregate Addition.
(e) Conditions to Addition of New Accounts. On the Addition
Date with respect to any New Accounts, the Trust shall acquire the applicable
Receivables in such New Accounts (and such New Accounts shall be Accounts for
purposes of this Agreement), subject to the satisfaction of the following
conditions:
(i) as of the applicable Selection Date, each New Account
shall be an Eligible Account;
(ii) the applicable Transferor shall have delivered to the
Owner Trustee and the Indenture Trustee copies of UCC financing
statements covering the Receivables in such New Accounts, if necessary
to perfect the interest of the Trust therein;
(iii) to the extent required by Section 3.1, the
applicable Transferor shall have deposited into the Collection Account
all Collections with respect to such New Accounts since the applicable
Addition Cut Off Date;
(iv) as of each of the applicable Addition Cut Off Date
and the applicable Addition Date, no Insolvency Event shall have
occurred nor shall the transfer to the Trust of the Receivables arising
in the New Accounts have been made in contemplation of the occurrence
thereof;
(v) the addition to the Trust of the Receivables arising
in the New Accounts shall not, in the reasonable belief of the
applicable Transferor, result in an Adverse Effect or in the Commercial
Obligor Overconcentration Amount exceeding zero;
(vi) on or before the Addition Date with respect to New
Accounts and the Receivables arising thereunder, the applicable
Transferor shall have delivered to the Owner Trustee, on behalf of the
Trust, and the Servicer a written assignment in substantially the form
of Exhibit C (the "New Account Assignment"), and the applicable
Transferor shall deliver to the Issuer and the Indenture Trustee the
computer file or microfiche list required to be delivered pursuant to
Section 2.1 on the date such file or list is required to be delivered
pursuant thereto, which file or list shall be incorporated into and
made a part of such New Account Assignment and this Agreement;
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(vii) if on or prior to the applicable Addition Date, with
respect to any three-month period or with respect to any twelve-month
period, the Addition Limit shall have been exceeded, the applicable
Transferor shall have received notice from each Note Rating Agency that
the addition pursuant to subsection 2.13(d) of such New Accounts in
excess of the Addition Limit will not result in the reduction or
withdrawal of its then existing rating of any Series, Class or Tranche
of Notes then issued and Outstanding and shall have delivered such
notice to the Owner Trustee and the Indenture Trustee;
(viii) the applicable Transferor shall have delivered to
the Owner Trustee and the Indenture Trustee an Officer's Certificate of
such Transferor, dated the applicable Addition Date, confirming, to the
extent applicable, the items set forth in clauses (i) through (v)
above; and
(ix) the applicable Transferor shall have delivered to the
Owner Trustee and the Indenture Trustee an Opinion of Counsel in
accordance with subsection 12.2(d).
Section 2.14. Removal of Accounts.
(a) On any day of any Monthly Period, each Transferor shall
have the right to require the reassignment to it or its designee of all of the
right, title and interest of the Indenture Trustee and the Trust in, to and
under the Receivables then existing and thereafter created, all Recoveries
related thereto, all monies due or to become due and all amounts received with
respect thereto and all proceeds thereof in or with respect to the Accounts
specified herein (the "Removed Accounts") and designated for removal by such
Transferor, upon satisfaction of the conditions in clauses (i) through (v)
below:
(i) on or before the tenth Business Day (the "Removal
Notice Date") immediately preceding the date for removal of the Removed
Accounts (the "Removal Date"), such Transferor shall have given the
Owner Trustee, the Indenture Trustee, the Servicer, the other
Transferors, if any, and each Note Rating Agency notice (unless such
notice requirement is waived) that the Receivables from such Removed
Accounts are to be reassigned to such Transferor on the Removal Date;
(ii) on or prior to the Removal Date, such Transferor
shall amend Schedule 1 by delivering to the Issuer and the Indenture
Trustee a computer file or microfiche list containing a true and
complete list of the Removed Accounts, specifying for each such
Account, as of the Removal Notice Date, its account number and the
aggregate amount of Receivables outstanding in such Account;
(iii) such Transferor shall have represented and warranted
as of the Removal Date that the list of Removed Accounts delivered
pursuant to paragraph (ii) above, as of the Removal Date, is true and
complete in all material respects;
43
(iv) the Note Rating Agency Condition shall have been
satisfied with respect to the removal of the Removed Accounts; and
(v) such Transferor shall have delivered to the Owner
Trustee and the Indenture Trustee an Officer's Certificate of such
Transferor, dated the Removal Date, to the effect that such Transferor
reasonably believes that (a) such removal of any Receivable of any
Removed Account will not result in an Adverse Effect with respect to
any Series, Class or Tranche of Notes and (b) no selection procedures
believed by such Transferor to be materially adverse to, or materially
beneficial to, the interests of any Noteholders have been used in
selecting the Removed Accounts from among any pool of Accounts of a
similar type.
There may be more than one Removal Date in any Monthly Period
and the Accounts to be designated as Removed Accounts need not be selected at
random by the applicable Transferor.
(b) Upon satisfaction of the above conditions, the Owner
Trustee, on behalf of the Trust, shall execute and deliver to such Transferor a
written reassignment in substantially the form of Exhibit D (the "Reassignment")
and shall, without further action, sell, transfer, assign, set over and
otherwise convey to such Transferor or its designee, effective as of the Removal
Date, without recourse, representation or warranty, all the right, title and
interest of the Indenture Trustee and the Trust in, to and under the Receivables
arising in the Removed Accounts, all Recoveries related thereto, all monies due
and to become due and all amounts received with respect thereto and all proceeds
thereof, and the Receivables from the Removed Accounts shall no longer
constitute a part of the Trust Assets. The Indenture Trustee and the Owner
Trustee may conclusively rely on the Officer's Certificate delivered pursuant to
this Section 2.14 and shall have no duty to make inquiries with regard to the
matters set forth therein and shall incur no liability in so relying.
(c) In addition to the foregoing, on the date when any
Receivable in an Account becomes a Defaulted Receivable (including any related
Finance Charge Receivables), the Indenture Trustee and the Trust shall
automatically and without further action or consideration transfer, set over and
otherwise convey to the applicable Transferor, without recourse, representation
or warranty, all right, title and interest of the Indenture Trustee and the
Trust in, to and under the Defaulted Receivables (including any related Finance
Charge Receivables) in such Account, all monies due or to become due, all
amounts received or receivable with respect thereto and all proceeds thereof;
provided that Recoveries of such Defaulted Receivables shall be applied as
provided in this Agreement. The Indenture Trustee and the Owner Trustee, on
behalf of the Trust, shall execute and deliver such instruments of transfer and
assignment (including any UCC termination statements), in each case without
recourse, as shall be reasonably requested by the applicable Transferor to vest
in such Transferor or its designee all right, title and interest that the
Indenture Trustee and the Trust had in such Defaulted Receivables (including any
related Finance Charge Receivables).
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Section 2.15. Account Allocations. In the event that any
Transferor is unable for any reason to transfer Receivables to the Trust in
accordance with the provisions of this Agreement, including by reason of the
application of the provisions of Section 8.1 or any order of any Governmental
Authority (a "Transfer Restriction Event"), then, in any such event, (a) such
Transferor agrees (except as prohibited by any such order) to allocate and pay
to the Trust, after the date of such inability, all Collections, including
Collections of Receivables transferred to the Trust prior to the occurrence of
such event, and all amounts which would have constituted Collections with
respect to Receivables but for such Transferor's inability to transfer
Receivables (up to an aggregate amount equal to the amount of Receivables
included as part of the Trust Assets on such date transferred to the Trust by
such Transferor), (b) such Transferor and the Servicer agree that such amounts
will be applied as Collections in accordance with the terms of this Agreement,
the Indenture and each Indenture Supplement and (c) for so long as the
allocation and application of all Collections and all amounts that would have
constituted Collections are made in accordance with clauses (a) and (b) above,
Receivables (and all amounts which would have constituted Receivables but for
such Transferor's inability to transfer Receivables to the Trust) which are
written off as uncollectible in accordance with this Agreement shall continue to
be allocated in accordance with the terms of this Agreement, the Indenture and
each Indenture Supplement. For the purpose of the immediately preceding
sentence, such Transferor and the Servicer shall treat the first received
Collections with respect to the Accounts as allocable to the Trust until the
Trust shall have been allocated and paid Collections in an amount equal to the
aggregate amount of Receivables included in the Trust as of the date of the
occurrence of such event. If such Transferor and the Servicer are unable
pursuant to any Requirements of Law to allocate Collections as described above,
such Transferor and the Servicer agree that, after the occurrence of such event,
payments on each Account with respect to the principal balance of such Account
shall be allocated first to the oldest principal balance of such Account and
shall have such payments applied as Collections in accordance with the terms of
this Agreement, the Indenture and each Indenture Supplement.
Section 2.16. Discount Option Receivables.
(a) The Transferor shall have the option to designate at any
time and from time to time a percentage or percentages, which may be a fixed
percentage or a variable percentage based on a formula (the "Discount Option
Percentage"), of all or any specified portion of Receivables conveyed on or
after the Discount Option Date ("Discount Option Receivables") to be treated as
Finance Charge Receivables. The aggregate amount of Discount Option Receivables
outstanding on any Date of Processing occurring on or after the initial Discount
Option Date shall equal (a) the aggregate Discount Option Receivables at the end
of the prior Date of Processing, plus (b) any new Discount Option Receivables
created on such Date of Processing, minus (c) any Discount Option Receivables
Collections received on such Date of Processing. Discount Option Receivables
created on any Date of Processing shall mean the product of the amount of any
Receivables created on such Date of Processing and the applicable Discount
Option Percentage. The Transferor shall also have the option of increasing,
reducing or withdrawing the Discount Option Percentage, at any time and from
time to time, without notice to or the consent of any Noteholder, on or after
such Discount Option Date. The Transferor shall provide to the Servicer, the
Owner Trustee, the Indenture Trustee and any Note Rating Agency 30 days prior
written notice of the Discount Option Date and any such designation or increase,
reduction or withdrawal. Such designation, increase, reduction or withdrawal
shall become effective on the Discount Option Date specified therefor upon
satisfaction of the following conditions:
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(i) each Transferor shall have delivered to the Owner
Trustee and the Indenture Trustee an Officer's Certificate of such
Transferor certifying that, in the reasonable belief of such Transferor
based on facts known to such Transferor at such time, such designation,
increase, reduction or withdrawal will not, at the time of its
occurrence, cause an Early Amortization Event or Event of Default with
respect to any Series, Class or Tranche of Notes to occur or an event
which, with notice or lapse of time or both, would constitute an Early
Amortization Event or Event of Default with respect to any Series,
Class or Tranche of Notes;
(ii) the Note Rating Agency Condition shall have been
satisfied with respect to such designation, increase, reduction or
withdrawal; and
(iii) the Transferor shall have caused an Issuer Tax
Opinion to be delivered to the Owner Trustee and the Indenture Trustee.
(b) Following a change in the Discount Option Percentage, the
Transferor shall apply the new Discount Option Percentage to all or the portion
of the Receivables to which the Discount Option Percentage is to be applied. The
Discount Option Percentage currently is 3%.
(c) After the Discount Option Date, Discount Option
Receivables Collections received with respect to Discount Option Receivables
shall be treated as Finance Charge Collections.
[END OF ARTICLE II]
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ARTICLE III
COLLECTIONS, ALLOCATIONS, DEPOSITS AND PAYMENTS
Section 3.1. Collections and Allocations.
The Servicer pursuant to the terms of this Agreement (or, if
the authority of the Servicer has been revoked pursuant to Section 9.1, the
Indenture Trustee, or, if a Successor Servicer has been appointed, the Successor
Servicer) shall instruct the Indenture Trustee in writing to apply all funds on
deposit in the Collection Account as described in this Article III and in any
Indenture Supplement for any Series of Notes. Except as otherwise provided
below, the Servicer pursuant to the terms of this Agreement shall deposit
Collections with respect to the Receivables into the Collection Account as
promptly as possible after the Date of Processing of such Collections, but in no
event later than the second Business Day following such Date of Processing, and
shall deposit Collections received with respect to the Collateral Certificates
with respect to any Monthly Period into the Collection Account no later than the
First Note Transfer Date in the next succeeding Monthly Period.
Subject to the express terms of any Indenture Supplement, but
notwithstanding anything else in this Agreement or the Indenture to the
contrary, for as long as TRS or an Affiliate of TRS remains the Servicer under
this Agreement and (i) maintains a short-term credit rating (which may be an
implied rating) of not less than "A-1" from Standard & Poor's, "P-1" from
Xxxxx'x and, if rated by Fitch, "F1" from Fitch (or such other rating below
"A-1," "P-1" or, if rated by Fitch, "F1," as the case may be, which is
satisfactory to such Note Rating Agency), (ii) obtains a guarantee or letter of
credit covering risk of collection with respect to its deposit and payment
obligations under this Agreement (in form and substance satisfactory to each
Note Rating Agency) from a guarantor having a short-term credit rating (which
may be an implied rating) of at least "A-1" from Standard & Poor's, "P-1" from
Xxxxx'x and, if rated by Fitch, "F1" from Fitch (or such other rating below
"A-1," "P-1" or, if rated by Fitch, "F1," as the case may be, which is
satisfactory to such Note Rating Agency), or (iii) the Note Rating Agency
Condition will have been satisfied despite the Servicer's inability to satisfy
the rating requirement specified in clause (i) above; and for 30 Business Days
following any reduction of any such rating or failure to satisfy the conditions
specified in clause (ii) or (iii) above, the Servicer need not make the daily
deposits of Collections into the Collection Account as provided in the preceding
paragraph. Rather, the Servicer may make a single deposit into the Collection
Account in immediately available funds not later than 1:00 p.m., New York City
time, on each applicable Note Transfer Date following the Monthly Period with
respect to which such deposit relates.
Notwithstanding anything else in this Agreement to the
contrary, with respect to any Monthly Period, whether the Servicer is required
to make daily or monthly deposits to the Collection Account, (i) the Servicer
will only be required to deposit Collections into the Collection Account up to
the amount required to be deposited or, without duplication, paid in respect of
Notes on or prior to the related Payment Date pursuant to the terms of the
applicable Indenture Supplement and (ii) the Servicer need not deposit into the
Collection Account any amount allocated or to be allocated to the holders of the
Transferor Interest pursuant to any Related Agreement and shall pay such amounts
to the holders of the Transferor Interest on a daily or monthly basis, as
directed by the holders of the Transferor Interest. Subject to the immediately
preceding sentence, the Servicer may retain its Servicing Fee and shall not be
required to deposit such Servicing Fee into the Collection Account. Collections
shall not be required to be invested in Eligible Investments until such time as
they are deposited into the Collection Account.
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Section 3.2. Allocations of Finance Charge Collections and the
Default Amount.
(a) With respect to each Monthly Period, the Indenture
Trustee, at the direction of the Servicer, shall allocate to each Series of
Notes an amount equal to the product of (i) the Floating Allocation Percentage
for Finance Charge Collections for such Monthly Period for such Series and (ii)
the Finance Charge Collections for such Monthly Period.
(b) With respect to each Monthly Period, the Indenture
Trustee, at the direction of the Servicer, shall allocate to each Series of
Notes an amount equal to the product of (i) the Floating Allocation Percentage
for the Default Amount for such Monthly Period for such Series and (ii) the
Default Amount for such Monthly Period.
Section 3.3. Allocations of Principal Collections. With
respect to each Monthly Period, the Indenture Trustee, at the direction of the
Servicer, shall allocate to each Series of Notes an amount equal to the product
of (i) the Principal Allocation Percentage for Principal Collections for such
Monthly Period for such Series and (ii) the Principal Collections for such
Monthly Period. In addition, with respect to each Monthly Period, if there is a
Remaining Series Available Principal Collections Shortfall for any Series of
Notes, the Indenture Trustee shall allocate to each such Series of Notes a
portion of Collateral Certificate Principal Shortfall Payments for such Monthly
Period in an amount equal to the Remaining Series Available Principal
Collections Shortfall for such Series in accordance with the applicable
Indenture Supplement; provided, however, that if the aggregate amount of
Collateral Certificate Principal Shortfall Payments is less than the aggregate
Remaining Series Available Principal Collections Shortfall for all Series, then
Collateral Certificate Principal Shortfall Payments allocable to each Series
shall equal the product of (i) the Collateral Certificate Principal Shortfall
Payments for such Monthly Period and (ii) a fraction, the numerator of which is
the Remaining Series Available Principal Collections Shortfall for such Series
and the denominator of which is the aggregate Remaining Series Available
Principal Collections Shortfall for all Series of Notes for such Monthly Period.
Section 3.4. Allocations of the Servicing Fee.
(a) As compensation for its servicing activities hereunder and
as reimbursement for any expense incurred by it in connection therewith, the
Servicer shall be entitled to receive a servicing fee (the "Servicing Fee") with
respect to each Monthly Period prior to the termination of the Trust pursuant to
Article VIII of the Trust Agreement, payable monthly on the related Payment
Date. For each Monthly Period, the Servicing Fee shall equal the sum of (i) the
Receivables Servicing Fee and (ii) the servicing fee amount for each Collateral
Certificate, as specified in the applicable Series Supplement for such
Collateral Certificate. The Issuer agrees to pay the portion of the servicing
fee owed to each Master Trust Servicer as servicer of the receivables underlying
such Collateral Certificate; provided, however, in no event shall the Owner
Trustee (as such or in its individual capacity), the Indenture Trustee, the
Administrator or any Noteholders be liable for the share of such servicing fee.
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(b) With respect to each Monthly Period, the Indenture
Trustee, at the direction of the Servicer, shall allocate to each Series of
Notes an amount equal to the product of (i) the Servicing Fee for such Monthly
Period and (ii) the Floating Allocation Percentage for the Servicing Fee for
such Monthly Period for such Series of Notes.
Section 3.5. Allocations of Amounts to the Overconcentration
Account and Allocations of Amounts on Deposit in the Overconcentration Account.
(a) If, for any Monthly Period, the Commercial Obligor
Overconcentration Amount is greater than zero (after giving effect to any
additions to or removals from the Trust on or prior to the related First Note
Transfer Date), on the related First Note Transfer Date, the Indenture Trustee
shall, pursuant to subsection 3.9(d), allocate or deposit to the
Overconcentration Account an amount equal to the excess, if any, of the Required
Overconcentration Account Amount with respect to such Monthly Period over the
Available Overconcentration Account Amount with respect to such Monthly Period
(before giving effect to any deposit to, or withdrawal from, the
Overconcentration Account made or to be made with respect to such date).
(b) If no Series of Notes is in an Accumulation Period or an
Amortization Period, amounts on deposit in the Overconcentration Account shall
be released to the holders of the Transferor Interest to the extent that, after
such release, the Available Overconcentration Account Amount with respect to the
related Monthly Period is equal to or greater than the Required
Overconcentration Account Amount for such Monthly Period.
(c) If an Accumulation Period or an Amortization Period has
commenced and is continuing with respect to any Series of Notes, amounts on
deposit in the Overconcentration Account shall be withdrawn from the
Overconcentration Account, deposited into the Collection Account and treated as
Available Principal Collections and, to the extent required, allocated to each
Series of Notes in an amount equal to the product of (A) a fraction, the
numerator of which is the Nominal Liquidation Amount for such Series as of the
last day of the related Monthly Period and the denominator of which is the
aggregate Nominal Liquidation Amounts for all Outstanding Series, in each case
as of the last day of the related Monthly Period and (B) the Available
Overconcentration Account Amount. Any remaining amounts on deposit in the
Overconcentration Account in excess of the amount required to be treated as
Available Principal Collections for a Monthly Period shall be released to the
holders of the Transferor Interest in accordance with the related Indenture
Supplement to the extent that, after such release, the Available
Overconcentration Account Amount with respect to the related Monthly Period is
equal to or greater than the Required Overconcentration Account Amount for such
Monthly Period.
Section 3.6. Allocations of Amounts to the Excess Funding
Account and Allocations of Amounts on Deposit in the Excess Funding Account.
49
(a) If, at the end of any Monthly Period, (i) the Transferor
Amount is, or as a result of a payment on the related First Note Transfer Date
would become, less than the Required Transferor Amount or (ii) the Pool Balance
is, or as a result of a payment on the related First Note Transfer Date would
become, less than the Required Pool Balance, the Indenture Trustee shall,
pursuant to subsection 3.9(d), allocate or deposit to the Excess Funding Account
(after giving effect to any deposit to, or withdrawal from, the
Overconcentration Account made or to be made with respect to such date) an
amount equal to the greater of (i) the amount by which the Transferor Amount
would be less than the Required Transferor Amount and (ii) the amount by which
the Pool Balance would be less than the Required Pool Balance, each determined
with respect to the related Monthly Period.
(b) If no Series of Notes is in an Accumulation Period or an
Amortization Period, amounts on deposit in the Excess Funding Account shall be
released to the holders of the Transferor Interest in accordance with the
related Indenture Supplement to the extent that, after such release, (i) the
Transferor Amount is equal to or greater than the Required Transferor Amount and
(ii) the Pool Balance is equal to or greater than the Required Pool Balance.
(c) If an Accumulation Period or an Amortization Period has
commenced and is continuing with respect to any Series of Notes, amounts on
deposit in the Excess Funding Account shall be withdrawn from the Excess Funding
Account, deposited into the Collection Account and treated as Principal
Collections and, to the extent required, allocated to each Series of Notes in
accordance with the applicable Indenture Supplement. Any remaining amounts on
deposit in the Excess Funding Account in excess of the amount required to be
treated as Principal Collections for a Monthly Period shall be released to the
holders of the Transferor Interest in accordance with the related Indenture
Supplement to the extent that, after such release, (i) the Transferor Amount is
equal to or greater than the Required Transferor Amount and (ii) the Pool
Balance is equal to or greater than the Required Pool Balance.
Section 3.7. Final Payment. Each Series, Class or Tranche of
Notes, as applicable, will be considered to be paid in full in the manner set
forth in the applicable Indenture Supplement. The Holders of such Series, Class
or Tranche of Notes, as applicable, will have no further right or claim, and the
Issuer will have no further obligation or liability with respect to such Series,
Class or Tranche of Notes, as applicable, on the earliest to occur of:
(a) the date of the payment in full of the Stated Principal
Amount of and all accrued, past due and additional interest on that Series,
Class or Tranche of Notes, as applicable;
(b) the date on which the Trust Assets are sold in accordance
with Section 7.08 of the Indenture and the applicable Indenture Supplement; and
(c) the seventh day following the Legal Maturity Date,
in each case after giving effect to all deposits, allocations, reimbursements,
reallocations, sales of Collateral and payments to be made on such date.
Section 3.8. Payments within a Series, Class or Tranche. All
payments of principal, interest or other amounts to the Noteholders will be made
in accordance with the Indenture Supplement for the applicable Series, Class or
Tranche of Notes.
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Section 3.9. Allocations of Finance Charge Collections,
Default Amounts, Servicing Fees and Principal Collections Allocable to the
Transferor Interest.
(a) Unless otherwise stated in any Indenture Supplement, the
Servicer shall allocate to the holders of the Transferor Interest an amount
equal to the product of (i) the Transferor Percentage for Finance Charge
Collections with respect to such Monthly Period and (ii) the Finance Charge
Collections for such Monthly Period. If so specified in any Indenture
Supplement, such amounts may be applied to cover certain shortfalls in the
amount of investment earnings (net of losses and investment expenses) on
investments of funds in certain Supplemental Issuer Accounts.
(b) The Servicer shall allocate to the holders of the
Transferor Interest an amount equal to the product of (i) the Transferor
Percentage for the Default Amount with respect to such Monthly Period and (ii)
the Default Amount with respect to such Monthly Period.
(c) The Servicer shall allocate to the holders of the
Transferor Interest an amount equal to the product of (i) the Transferor
Percentage for the Servicing Fee with respect to such Monthly Period and (ii)
the Servicing Fee with respect to such Monthly Period.
(d) Unless otherwise stated in any Indenture Supplement, the
Servicer shall allocate to the holders of the Transferor Interest an amount
equal to the product of (i) the Transferor Percentage for Principal Collections
with respect to such Monthly Period and (ii) the Principal Collections with
respect to such Monthly Period; provided, however, that amounts payable to the
holders of the Transferor Interest pursuant to this subsection 3.9(d) shall
instead be deposited first, into the Overconcentration Account to the extent
that the Available Overconcentration Account Amount with respect to such Monthly
Period is, or as a result of such payment would become, less than the Required
Overconcentration Account Amount with respect to such Monthly Period and second,
into the Excess Funding Account to the extent that (i) the Transferor Amount is,
or as a result of such payment would become, less than the Required Transferor
Amount or (ii) the Pool Balance is, or as a result of such payment would become,
less than the Required Pool Balance.
Section 3.10. Adjustments for Miscellaneous Credits and
Fraudulent Charges.
(a) If the Servicer adjusts downward the amount of any
Receivable because of a rebate, refund, unauthorized charge or billing error to
an Obligor, because such Receivable was created in respect of merchandise which
was refused or returned by an Obligor, or because the Servicer or applicable
Account Owner processes as a credit adjustment any uncollectible Small Balances,
or if the Servicer otherwise adjusts downward the amount of any Receivable
without receiving Collections therefor or without charging off such amount as
uncollectible, then, in any such case, the amount of Principal Receivables used
to calculate the Transferor Amount, the Transferor Interest and (unless
otherwise specified) any other amount required in any Related Agreement to be
calculated by reference to the amount of Principal Receivables, will be reduced
by the product of one minus the Discount Option Percentage and the amount of the
adjustment. Similarly, the amount of Principal Receivables used to calculate the
Transferor Amount, the Transferor Interest and (unless otherwise specified) any
other amount required in any Related Agreement to be calculated by reference to
the amount of Principal Receivables, will be reduced by the product of one minus
the Discount Option Percentage and the amount of any Receivable which was
discovered as having been created through a fraudulent or counterfeit charge or
with respect to which the covenant contained in subsection 2.9(b) was breached.
Any adjustment required pursuant to either of the two preceding sentences shall
be made on or prior to the end of the Monthly Period in which such adjustment
obligation arises.
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In the event that, following the exclusion of such Principal
Receivables from (x) the calculation of the Transferor Amount, such Transferor
Amount would be an amount less than the Required Transferor Amount or (y) the
calculation of the Pool Balance, such Pool Balance would be an amount less than
the Required Pool Balance, the applicable Transferor shall make a deposit, not
later than 1:00 p.m., New York City time, on the Payment Date following the
Monthly Period in which such adjustment obligation arises, into the Excess
Funding Account in immediately available funds in an amount equal to the greater
of the amount by which (i) the Transferor Amount would be less than the Required
Transferor Amount or (ii) the Pool Balance would be less than the Required Pool
Balance, due to adjustments with respect to Receivables conveyed by such
Transferor (up to the amount of such Principal Receivables).
(b) If (i) the Servicer makes a deposit into the Collection
Account in respect of a Collection of a Receivable and such Collection was
received by the Servicer in the form of a check which is not honored for any
reason or (ii) the Servicer makes a mistake with respect to the amount of any
Collection and deposits an amount that is less than or more than the actual
amount of such Collection, the Servicer shall appropriately adjust the amount
subsequently deposited into the Collection Account to reflect such dishonored
check or mistake. Any Receivable in respect of which a dishonored check is
received shall be deemed not to have been paid. Notwithstanding the first two
sentences of this paragraph, adjustments made pursuant to this Section 3.10
shall not require any change in any report previously delivered.
Section 3.11. Issuer Rate Fees. The Transferor shall have the
option to transfer to the Trust at any time all or a portion of any interchange,
merchant discount, issuer rate fees or other fees or charges derived from
transactions related to the Accounts. All of such interchange, merchant
discount, issuer rate fees or other fees or charges shall be deemed to be, and
shall be treated as, Finance Charge Collections under this Agreement and the
Indenture.
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Section 3.12. Designation of Remaining Principal Shortfalls.
On each First Note Transfer Date, the Servicer shall determine with respect to
the prior Monthly Period whether there is a Remaining Series Available Principal
Collections Shortfall for any Series of Notes after application of Shared Excess
Available Principal Collections for the benefit of such Series of Notes for such
Monthly Period. The Servicer shall determine the aggregate amount of such
Remaining Series Available Principal Collections Shortfalls for all Series of
Notes for such Monthly Period and shall propose, with respect to each Collateral
Certificate, a principal shortfall amount (the "Proposed Principal Shortfall
Amount") for such Monthly Period. The sum of all such Proposed Principal
Shortfall Amounts shall equal the aggregate amount of such Remaining Series
Available Principal Collections Shortfalls for such Monthly Period. In
determining the Proposed Principal Shortfall Amount for each Collateral
Certificate, the Servicer agrees to determine such amount in a manner that shall
maximize the amount of payments received from Collateral Certificates in respect
of Proposed Principal Shortfalls Amounts.
[END OF ARTICLE III]
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ARTICLE IV
SERVICING OF RECEIVABLES
Section 4.1. Acceptance of Appointment and Other Matters
Relating to the Servicer.
(a) TRS has agreed to act, and has acted, as the Servicer
under the Original Transfer Agreement and this Agreement, and TRS hereby agrees
to act as the Servicer under this Agreement. The Noteholders, by their
acceptance of the Notes, shall be deemed to consent to TRS acting as Servicer.
(b) The Servicer shall service and administer the Receivables,
shall collect and deposit into the Collection Account, the Overconcentration
Account, the Excess Funding Account or any Supplemental Issuer Account or
Sub-Account payments due under the Receivables and shall charge off as
uncollectible Receivables, all in accordance with its customary and usual
servicing procedures for servicing charge receivables comparable to the
Receivables and in accordance with the Account Guidelines. The Servicer shall
service and administer the Collateral Certificates and shall collect payments
due under the Collateral Certificates in accordance with the terms and
provisions of each such Collateral Certificate. The Servicer shall have full
power and authority, acting alone or through any party properly designated by it
hereunder, to do any and all things in connection with such servicing and
administration which it may deem necessary or desirable. Without limiting the
generality of the foregoing and subject to Section 9.1, the Servicer or its
designee is hereby authorized and empowered, unless such power is revoked by the
Indenture Trustee on account of the occurrence of a Servicer Default pursuant to
Section 9.1, (i) to instruct the Indenture Trustee to make allocations,
withdrawals and payments to or from the Collection Account, the
Overconcentration Account, the Excess Funding Account and any Supplemental
Issuer Account or Sub-Account as set forth in this Agreement, the Indenture or
any Indenture Supplement, (ii) to take any action required or permitted under
any Supplemental Credit Enhancement Agreement or Derivative Agreement, as set
forth in this Agreement, the Indenture or any Indenture Supplement, (iii) to
instruct the Indenture Trustee or the Owner Trustee in writing, as set forth in
this Agreement, (iv) to execute and deliver, on behalf of the Trust, any and all
instruments of satisfaction or cancellation, or of partial or full release or
discharge, and all other comparable instruments, with respect to the Receivables
or the Collateral Certificates and, after the delinquency of any Receivable and
to the extent permitted under and in compliance with applicable Requirements of
Law, to commence collection or enforcement proceedings with respect to such
Receivables, (v) to execute and deliver, on behalf of the Trust, any and all
instruments deemed necessary or appropriate by it to take any action or fulfill
any obligation with respect to the Collateral Certificates and (vi) at the
expense of the Transferor, to make any filings, reports, notices, applications
and registrations with, and to seek any consents or authorizations from, the
Commission and any state securities authority on behalf of the Trust as may be
necessary or advisable to comply with any federal or state securities or
reporting requirements or other laws or regulations. Each of the Indenture
Trustee and the Owner Trustee agree that it shall promptly follow the
instructions of the Servicer to withdraw funds from the applicable Issuer
Account and to take any action required under any Supplemental Credit
Enhancement Agreement or Derivative Agreement at such time as required under
this Agreement, the Indenture or any Indenture Supplement. Each of the Indenture
Trustee and the Owner Trustee shall execute and furnish the Servicer with such
documents as may be necessary or appropriate to enable the Servicer to carry out
its servicing and administrative duties hereunder.
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(c) The Servicer shall not, and no Successor Servicer shall,
be obligated to use separate servicing procedures, offices, employees or
accounts for servicing the Receivables from the procedures, offices, employees
and accounts used by the Servicer or such Successor Servicer, as the case may
be, in connection with servicing other comparable receivables.
(d) The Servicer shall comply with and perform its servicing
obligations with respect to the Accounts and the Receivables in accordance with
the Account Agreements relating to the Accounts and the Account Guidelines and
all applicable rules and regulations affecting the Accounts and the Receivables,
except insofar as any failure to so comply or perform would not materially and
adversely affect the Trust or the Noteholders.
(e) The Servicer shall pay out of its own funds, without
reimbursement, all expenses incurred in connection with the servicing activities
hereunder, including all expenses related to enforcement of the Receivables and
the Collateral Certificates, fees and disbursements of the Indenture Trustee and
the Owner Trustee (including the reasonable fees and expenses of their
respective outside counsel) and independent accountants for the Servicer.
Section 4.2. Representations, Warranties and Covenants of the
Servicer. TRS, as initial Servicer, hereby makes, and any Successor Servicer by
its appointment hereunder shall make, with respect to itself, on the Execution
Date and on each Issuance Date on which it is the Servicer (and on the date of
any such appointment), the following representations, warranties and covenants
on which the Transferor, the Trust, the Owner Trustee and the Indenture Trustee
shall be deemed to have relied in accepting each Receivable and each Collateral
Certificate in trust under this Agreement or the Indenture, as applicable, and
in entering into this Agreement and the Indenture:
(a) Organization and Good Standing. The Servicer is a
corporation duly incorporated and validly existing under the applicable law of
the jurisdiction of its organization or incorporation and has, in all material
respects, full power and authority to own its properties and conduct its
servicing business as presently owned or conducted, and to execute, deliver and
perform its obligations under this Agreement.
(b) Due Qualification. The Servicer is duly qualified to do
business and is in good standing as a foreign corporation or other foreign
entity (or is exempt from such requirements) and has obtained all necessary
licenses and approvals in each jurisdiction in which the servicing of
Receivables as required by this Agreement requires such qualification, except
where the failure to so qualify or obtain licenses or approvals would not have a
material adverse effect on its ability to perform its obligations as Servicer
under this Agreement.
(c) Due Authorization. The execution, delivery, and
performance by the Servicer of this Agreement and the other agreements and
instruments executed or to be executed by the Servicer as contemplated hereby or
thereby, have been duly authorized by the Servicer by all necessary action on
the part of the Servicer.
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(d) Binding Obligation. This Agreement constitutes a legal,
valid and binding obligation of the Servicer, enforceable in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally from time to time in effect or by general principles
of equity.
(e) No Conflict. The execution and delivery by the Servicer of
this Agreement, the performance by the Servicer of the transactions contemplated
by this Agreement and the fulfillment by the Servicer of the terms hereof
applicable to the Servicer, will not conflict with, violate or result in any
breach of any of the material terms and provisions of, or constitute (with or
without notice or lapse of time or both) a material default under, any
indenture, contract, agreement, mortgage, deed of trust or other instrument to
which the Servicer is a party or by which it or its properties are bound.
(f) No Violation. The execution and delivery of this Agreement
by the Servicer, the performance by the Servicer of the transactions
contemplated by this Agreement and the fulfillment by the Servicer of the terms
hereof applicable to the Servicer, will not conflict with or violate any
Requirements of Law applicable to the Servicer.
(g) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of the Servicer, threatened against the
Servicer before any Governmental Authority seeking to prevent the consummation
of any of the transactions contemplated by this Agreement or seeking any
determination or ruling that, in the reasonable judgment of the Servicer, would
materially and adversely affect the performance by the Servicer of its
obligations under this Agreement.
(h) Compliance With Requirements of Law. The Servicer shall
duly satisfy all obligations on its part to be fulfilled under or in connection
with each Receivable and the related Account, if any, will maintain in effect
all qualifications required under Requirements of Law in order to service
properly each Receivable and the related Account, if any, and will comply in all
material respects with all other Requirements of Law in connection with
servicing each Receivable and the related Account, if any, the failure to comply
with which would have an Adverse Effect.
(i) No Rescission or Cancellation. The Servicer shall not
authorize any rescission or cancellation of any Receivable or any Collateral
Certificate, except in accordance with the Account Guidelines or as ordered by a
court of competent jurisdiction or other Governmental Authority.
(j) Protection of Rights. The Servicer shall take no action
which, nor omit to take any action the omission of which, would impair the
rights of the Trust, the Indenture Trustee or the Noteholders in any Receivable
or in any Collateral Certificate, nor shall it reschedule, revise or defer
payments due on any Receivable except in accordance with the Account Guidelines,
nor shall it sell any Trust Assets except as provided in any Related Agreement.
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(k) Receivables Not To Be Evidenced by Instruments. Except in
connection with its enforcement or collection of an Account, the Servicer will
take no action to cause any Receivable to be evidenced by any instrument (as
defined in the UCC) and, if any Receivable is so evidenced as a result of the
Servicer's action, it shall be assigned to the Servicer as provided in this
Section 4.2.
(l) All Consents. All authorizations, consents, orders or
approvals of, or registrations or declarations with, any Governmental Authority
required to be obtained, effected or given by the Servicer in connection with
the execution and delivery by the Servicer of this Agreement and the performance
by the Servicer of the transactions contemplated by this Agreement, have been
duly obtained, effected or given and are in full force and effect.
In the event any of the representations, warranties or
covenants of the Servicer contained in subsection 4.2(h), (i), (j) or (k) with
respect to any Receivable, the related Account or any Collateral Certificate is
breached, and such breach has a material adverse effect on the interest of the
Indenture Trustee or the Trust in such Receivable or Collateral Certificate, as
applicable, and is not cured within 60 days (or such longer period, not in
excess of 150 days, as may be agreed to by the Indenture Trustee and the
Transferor) of the earlier to occur of the discovery of such event by the
Servicer, or receipt by the Servicer of notice of such event given by the
Indenture Trustee or a Transferor, each such Receivable or, at the option of the
Transferor, all Receivables in the Account or Accounts or each such Collateral
Certificate, as applicable, to which such event relates shall be assigned and
transferred to the Servicer on the terms and conditions set forth below;
provided, however, that such Receivables or Collateral Certificate will not be
assigned to the Servicer if, on any day prior to the end of such 60-day or
longer period, (i) the relevant representation and warranty shall be true and
correct, or the related covenant shall have been complied with, in all material
respects and (ii) the Servicer shall have delivered to the Transferor and the
Indenture Trustee a certificate of an Authorized Officer of the Servicer
describing the nature of the breach and the manner in which such breach was
cured.
The Servicer shall effect such assignment by making a deposit
into the Collection Account in immediately available funds on the First Note
Transfer Date following the Monthly Period in which such assignment obligation
arises in an amount equal to the amount of such Receivables or the Invested
Amount of such Collateral Certificate, as applicable.
Upon each such assignment to the Servicer, the Indenture
Trustee and the Trust shall automatically and without further action sell,
transfer, assign, set over and otherwise convey to the Servicer, without
recourse, representation or warranty, all right, title and interest of the
Indenture Trustee and the Trust in and to such Receivables and/or Collateral
Certificates, all Recoveries with respect thereto, all monies due or to become
due and all amounts received with respect thereto and all proceeds thereof. The
Indenture Trustee and the Trust shall execute such documents and instruments of
transfer or assignment and take such other actions as shall be reasonably
requested by the Servicer to effect the conveyance of any such property pursuant
to this Section 4.2 but only upon receipt of an Officer's Certificate of the
Servicer that states that all conditions set forth in this Section 4.2 have been
satisfied. The obligation of the Servicer to accept assignment of such property,
and to make the deposits, if any, required to be made to the Collection Account
as provided in the preceding paragraph, shall constitute the sole remedy
respecting the event giving rise to such obligation available to Noteholders (or
the Indenture Trustee on behalf of Noteholders) or the Trust, except as provided
in Section 7.4.
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Section 4.3. Reports and Records for the Owner Trustee and the
Indenture Trustee.
(a) Daily Records. For as long as deposits of Collections are
required to be made daily by the Servicer pursuant to Section 3.1, on each
Business Day, the Servicer shall make or cause to be made available at the
office of the Servicer for inspection by the Owner Trustee, the Indenture
Trustee and any Transferor upon request a record setting forth (i) the
Collections in respect of Principal Receivables and Finance Charge Receivables
processed by the Servicer as of the close of business on the second preceding
Business Day in each Account, (ii) the aggregate amount of Receivables as of the
close of business on the second preceding Business Day in each Account and (iii)
if the Trust Assets include one or more Collateral Certificates, the Invested
Amount of each Collateral Certificate as of the close of business on the second
preceding Business Day. The Servicer shall, at all times, maintain its computer
files with respect to the Accounts in such a manner so that the Accounts may be
specifically identified and shall make available to the Indenture Trustee, the
Owner Trustee and any Transferor at the office of the Servicer on any Business
Day any computer programs necessary to make such identification; provided,
however, that the Indenture Trustee, the Owner Trustee and the Transferor shall
enter into such confidentiality agreements (including terms and provisions for
information security and data protection) as the Servicer may deem necessary to
protect its interests.
(b) Monthly Servicer's Certificate. Not later than the second
Business Day preceding each Payment Date, the Servicer shall, with respect to
each outstanding Series, deliver to the Owner Trustee, the Indenture Trustee,
the Transferor and each Note Rating Agency a certificate of an Authorized
Officer substantially in the form specified in the related Indenture Supplement.
Section 4.4. Annual Certificate of Servicer. The Servicer
shall deliver to the Indenture Trustee, the Owner Trustee, the Transferors and
each Note Rating Agency on or before the 90th day following the end of each
fiscal year, beginning with the fiscal year ending December 31, 2006, the
statement of compliance required under Item 1123 of Regulation AB with respect
to such fiscal year, which statement will be in the form of an Officer's
Certificate of the Servicer (with appropriate insertions) to the effect that (a)
a review of the activities of the Servicer during such fiscal year and of its
performance under this Agreement was made under the supervision of the officer
signing such certificate and (b) to the best of such officer's knowledge, based
on such review, the Servicer has fulfilled all its obligations under this
Agreement in all material respects throughout such fiscal year or, if there has
been a failure to fulfill any such obligation in any material respect,
specifying each such failure known to such officer and the nature and status
thereof; provided, however, that on or before March 31, 2006, the Servicer shall
cause to be delivered the Officer's Certificate of the Servicer (with
appropriate insertions) as was required to be delivered pursuant to, and in
accordance with, Section 4.4 of the Original Transfer Agreement.
Section 4.5. Annual Servicing Report of Independent Public
Accountants; Copies of Reports Available.
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(a) On or before the 90th day following the end of each fiscal
year, beginning with the fiscal year ending December 31, 2006, the Servicer
shall cause a firm of nationally recognized independent public accountants (who
may also render other services to the Servicer or the Transferor) to furnish to
the Indenture Trustee, the Owner Trustee, the Servicer, the Transferor and each
Note Rating Agency each attestation report on assessments of compliance with the
Servicing Criteria with respect to the Servicer or any affiliate thereof during
the related fiscal year delivered by such accountants pursuant to Rule 13(a)-18
or Rule 15(d)-18 of the Exchange Act and Item 1122 of Regulation AB; provided,
however, that on or before March 31, 2006, the Servicer shall cause to be
furnished the reports as were required to be delivered pursuant to, and in
accordance with, Section 4.5 of the Original Transfer Agreement.
(b) A copy of each certificate and report provided pursuant to
subsection 4.3(b), or Section 4.4 or 4.5 may be obtained by any Noteholder or
Note Owner by a request in writing to the Indenture Trustee addressed to the
Corporate Trust Office.
Section 4.6. Tax Treatment. Unless otherwise specified in the
Indenture or an Indenture Supplement with respect to a particular Series, Class
or Tranche of Notes, each Transferor has entered into this Agreement, and the
Notes will be issued, with the intention that, for federal, state and local
income and franchise tax purposes, (i) each Series, Class or Tranche of Notes
which are characterized as indebtedness at the time of their issuance will
qualify as indebtedness secured by the Trust Assets and (ii) the Trust shall not
be treated as an association or publicly traded partnership taxable as a
corporation. Each Transferor, by entering into this Agreement, and each
Noteholder, by the acceptance of any such Note (and each Note Owner, by its
acceptance of an interest in the applicable Note), agree to treat such Note for
federal, state and local income and franchise tax purposes as indebtedness of
the Transferor. Each Noteholder agrees that it will cause any Note Owner
acquiring an interest in a Note through it to comply with this Agreement as to
treatment as indebtedness under applicable tax law, as described in this Section
4.6. The parties hereto agree that they shall not cause or permit the making, as
applicable, of any election under Treasury Regulation Section 301.7701-3 whereby
the Trust or any portion thereof would be treated as a corporation for federal
income tax purposes. Subject to Section 8.15 of the Indenture, the parties
hereto shall treat the Trust as a security arrangement for federal income tax
purposes and shall not file any federal income tax returns or obtain any federal
employer identification number for the Trust. The provisions of this Agreement
shall be construed in furtherance of the foregoing intended tax treatment.
Section 4.7. Notices to American Express Entities. In the
event that TRS is no longer acting as Servicer, any Successor Servicer shall
deliver or make available to Centurion, FSB and TRS each certificate and report
required to be provided thereafter pursuant to subsection 4.3(b), Section 4.4
and subsections 4.5(a) and (b), as well as information reasonably requested by
Centurion, FSB or TRS.
Section 4.8. Recoveries. If at any time the Servicer cannot
identify the Recoveries that relate to specific Defaulted Receivables, then the
Servicer shall reasonably estimate, on or prior to each First Note Transfer
Date, the amount of Recoveries to be attributed to such Defaulted Receivables.
59
Section 4.9. Reports to the Commission. The Servicer shall, on
behalf of the Trust and at the expense of the Transferor, cause to be filed with
the Commission any periodic reports required to be filed under the provisions of
the Exchange Act and the rules and regulations of the Commission thereunder. The
applicable Transferor shall, at its own expense, cooperate in any reasonable
request of the Servicer in connection with such filings.
[END OF ARTICLE IV]
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ARTICLE V
ADMINISTRATION OF THE TRUST; DUTIES OF THE ADMINISTRATOR
Section 5.1. Appointment of Administrator; Duties of
Administrator.
(a) The Issuer hereby appoints TRS to act as initial
administrator (the "Administrator"), subject to Section 5.8.
(b) Duties of Administrator with Respect to the Related
Agreements. The Administrator shall consult with the Owner Trustee regarding the
duties of the Issuer and the Owner Trustee under the Related Agreements. The
Administrator shall monitor the performance of the Issuer and shall advise the
Owner Trustee when action is necessary to comply with the Issuer's or the Owner
Trustee's duties under the Related Agreements. The Administrator shall prepare
for execution by the Issuer or the Owner Trustee or shall cause the preparation
by other appropriate Persons of all such documents, reports, filings,
instruments, certificates and opinions as it shall be the duty of the Issuer or
the Owner Trustee to prepare, file or deliver pursuant to any Related Agreement.
In furtherance of the foregoing, the Administrator shall take all appropriate
action that it is the duty of the Issuer or the Owner Trustee to take pursuant
to the Indenture and any Indenture Supplement including such of the foregoing as
are required with respect to the following matters under the Indenture and any
Indenture Supplement (parenthetical references are to Articles or Sections of
the Indenture):
(i) the duty to cause the Note Register to be kept, and
notifying the Indenture Trustee of any appointment of a new Note
Registrar and the location, or change in location, of the Note
Registrar (subsection 4.05(a));
(ii) preparing or obtaining the documents, legal opinions
and instruments required for execution, authentication and delivery of
the Notes, and delivery of the same to the Indenture Trustee for
authentication (Sections 4.03, 4.04 and 4.10), providing for the
replacement of mutilated, destroyed, lost or stolen Notes (Section
4.06), providing for the exchange or transfer of Notes (Section 4.05)
and, to the extent set forth in the related Indenture Supplement,
notifying each Note Rating Agency in writing of the issuance of any
Tranche, Class or Series of Notes;
(iii) directing the Indenture Trustee with respect to the
investment of funds in the Issuer Accounts (Section 5.03);
(iv) preparing or obtaining the documents, legal opinions
and instruments required to be delivered to the Indenture Trustee with
respect to the satisfaction and discharge of the Indenture (subsection
6.01(c)) and preparing the documents necessary for the Indenture
Trustee to acknowledge the same (subsection 6.01(a));
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(v) on the resignation or removal of any Indenture
Trustee, appointing a successor Indenture Trustee (subsection 8.10(e))
and giving written notice of such resignation or removal and
appointment to each Noteholder (subsection 8.10(f));
(vi) preparing or causing to be prepared tax returns for
the Issuer (if required) and the reporting information for the
Noteholders (Section 8.15);
(vii) preparing on behalf of the Issuer written
instructions regarding any action proposed to be taken or omitted by
the Indenture Trustee upon the Indenture Trustee's application therefor
(Section 8.18);
(viii) furnishing to the Indenture Trustee a list of the
names and addresses of the Registered Noteholders not more than 15 days
after each Record Date or at such other times as the Indenture Trustee
may request in writing (Section 9.01);
(ix) establishing reasonable rules for matters relating to
any request, demand, authorization, direction, notice, consent, waiver
or other action provided by the Indenture to be given or taken by, or a
meeting of, Noteholders not otherwise set forth in Section 9.04 of the
Indenture (subsection 9.04(g));
(x) preparing for the Issuer such filings for filing with
the Commission, and providing the Indenture Trustee with copies thereof
once filed, as required by the Exchange Act or otherwise as in
accordance with rules and regulations prescribed from time to time by
the Commission (Section 9.05);
(xi) preparing, completing and delivering to the Indenture
Trustee and the trustee for the applicable Master Trust (with a copy to
each Note Rating Agency), a Monthly Noteholders' Statement (Section
9.06);
(xii) preparing for the Issuer the Payment Instruction
after the Issuer receives each Monthly Servicer's Certificate under the
applicable Series Supplement, delivering a copy thereof to the
Indenture Trustee and the trustee for the applicable Master Trust and
compiling such other information for the Issuer (subsection 9.07(a));
(xiii) preparing or obtaining any necessary Opinion of
Counsel, Issuer Tax Opinion, Officer's Certificate, or other document
or instrument as may be required in connection with any supplemental
indenture or amendment to the Indenture or any Indenture Supplement
(Article X);
(xiv) giving notice to each Note Rating Agency and
collecting the vote of Noteholders, as necessary, in connection with
any supplemental indenture or amendment to the Indenture or any
Indenture Supplement (Article X);
(xv) appointing Paying Agents (Section 11.02) and causing
any such Paying Agents to execute and deliver to the Indenture Trustee
an instrument pursuant to which it agrees to act as Paying Agent as set
forth in Section 11.03 of the Indenture;
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(xvi) preparing Officer's Certificates of the Issuer
directing the Paying Agent to pay to the Indenture Trustee sums held in
trust by the Issuer or such Paying Agent for the purpose of discharging
the Indenture (Section 11.03);
(xvii) preparing written statements for execution by an
Authorized Officer as required by Section 11.04 of the Indenture;
(xviii) performing or causing to be performed all things
necessary to preserve and keep in full force and effect the legal
existence of the Issuer (Section 11.05) and comply with applicable law
(Section 11.07);
(xix) giving prompt written notice to the Indenture
Trustee and each Note Rating Agency of each Event of Default under the
Indenture, each breach on the part of the applicable Master Trust
Servicer or the applicable Master Trust Transferor of its respective
obligations under the applicable Pooling and Servicing Agreement or any
default of a Derivative Counterparty (Section 11.08);
(xx) providing to Noteholders and prospective Noteholders
information required to be provided by the Issuer pursuant to Rule 144A
under the Securities Act (Section 11.11);
(xxi) performing and observing all of the Issuer's
obligations under the Indenture, any Indenture Supplement, the Trust
Agreement and any other instrument or agreement relating to the
Collateral including, without limitation, preparing and causing the
Issuer to file UCC financing statements and continuation statements
(Section 11.12);
(xxii) preparing or obtaining the instruments, documents,
agreements and legal opinions required to be delivered by the Issuer
and preparing any notice required to be given to the Note Rating
Agencies, in connection with the merger or consolidation of the Issuer
with any other Person (subsection 11.13(a)) or the conveyance or
transfer of any of the Issuer's property or assets (subsection
11.13(b));
(xxiii) giving written notice to the affected Noteholders
of any optional repurchase by the Servicer (Section 12.02) and to the
Indenture Trustee and each Note Rating Agency with respect to any such
optional repurchase or Early Amortization Event (Section 12.03);
(xxiv) to the extent set forth herein or in the Indenture,
preparing or obtaining the instruments, documents, agreements and legal
opinions required to be delivered by the Issuer and/or the Indenture
Trustee and preparing any notice required to be given by the Issuer to
the Note Rating Agencies, the Indenture Trustee and the Servicer in
connection with addition or removal of Collateral, and designating such
Collateral to be added or removed, as the case may be;
(xxv) to the extent set forth herein or in the Indenture,
taking, or assisting the Issuer and/or the Indenture Trustee in taking,
all actions necessary and advisable to obtain, maintain and enforce a
perfected lien on and security interest in the Collateral in favor of
the Indenture Trustee and preparing for execution and delivery or
filing by the Issuer all such supplements and amendments to this
Agreement and the Indenture and all such financing statements,
amendments to such financing statements, instruments of further
assurance and other instruments; and
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(xxvi) to the extent set forth herein or in the Indenture,
obtaining legal opinions with respect to the security interest in the
Collateral.
(c) Additional Duties.
(i) In addition to the duties of the Administrator set
forth above, the Administrator shall perform all duties and obligations
of the Issuer under the Related Agreements and shall perform such
calculations and shall prepare for execution by the Issuer and shall
cause the preparation by other appropriate Persons of all such
documents, reports, filings, instruments, certificates and opinions as
it shall be the duty of the Issuer or the Owner Trustee to prepare,
file or deliver pursuant to the Related Agreements, and at the request
of the Issuer shall take all appropriate action that it is the duty of
the Issuer or the Owner Trustee to take pursuant to the Related
Agreements. Subject to Section 5.5 of this Agreement, and in accordance
with the directions of the Issuer, the Administrator shall administer,
perform or supervise the performance of such other activities in
connection with the Collateral (including the Related Agreements) as
are not covered by any of the foregoing provisions and as are expressly
requested by the Owner Trustee and are reasonably within the capability
of the Administrator.
(ii) The Administrator shall perform the duties expressly
required to be performed by the Administrator under the Trust
Agreement.
(iii) In carrying out the foregoing duties or any of its
other obligations under this Agreement, the Administrator may enter
into transactions with or otherwise deal with any of its Affiliates;
provided, however, that the terms of any such transactions or dealings
shall be in accordance with any directions received from the Issuer and
shall be, in the Administrator's opinion, no less favorable to the
Issuer than would be available from unaffiliated parties.
(iv) It is the intention of the parties hereto that the
Administrator shall, and the Administrator hereby agrees to, execute on
behalf of the Issuer all such documents, reports, filings, instruments,
certificates and opinions as it shall be the duty of the Issuer to
prepare, file or deliver pursuant to the Related Agreements. In
furtherance thereof, the Owner Trustee shall, on behalf of the Issuer,
execute and deliver to the Administrator and its agents, and to each
successor Administrator appointed pursuant to the terms hereof, one or
more powers of attorney substantially in the form of Exhibit C,
appointing the Administrator the attorney-in-fact of the Issuer for the
purpose of executing on behalf of the Issuer all such documents,
reports, filings, instruments, certificates and opinions.
(d) Non-Ministerial Matters.
(i) With respect to matters that in the reasonable
judgment of the Administrator are non-ministerial, the Administrator
shall not take any action unless within a reasonable time before the
taking of such action, the Administrator shall have notified the Owner
Trustee of the proposed action and the Owner Trustee shall not have
withheld consent or provided an alternative direction. For the purpose
of the preceding sentence, "non-ministerial matters" shall include:
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1. the amendment of or any supplement to the Indenture;
2. the initiation of any claim or lawsuit by the Issuer
and the compromise of any action, claim or lawsuit brought
by or against the Issuer;
3. the amendment, change or modification of the Related
Agreements;
4. the appointment of successor Note Registrars, successor
Paying Agents and successor trustees pursuant to the
Indenture or the appointment of successor Administrators,
or the consent to the assignment by the Note Registrar,
Paying Agent or trustee of its obligations under the
Indenture; and
5. the removal of the Indenture Trustee.
(ii) Notwithstanding anything to the contrary in this
Agreement, the Administrator shall not be obligated to, and shall not,
(x) make any payments to the Noteholders or any Transferor under the
Related Agreements or (y) take any other action that the Issuer directs
the Administrator not to take on its behalf.
Section 5.2. Records. The Administrator shall maintain
appropriate books of account and records relating to services performed
hereunder, which books of account and records shall be accessible for inspection
by the Issuer, the Owner Trustee, the Indenture Trustee and any Transferor at
any time during normal business hours.
Section 5.3. Compensation. As compensation for the performance
of the Administrator's obligations under this Agreement, the Administrator shall
be entitled to an amount not to exceed $5,000 per month, in addition to
reimbursement for its liabilities and extra out-of-pocket expenses related to
its performance hereunder or under any Related Agreement. Such amounts shall be
paid by the Transferor in accordance with Section 12.3.
Section 5.4. Additional Information To Be Furnished to Issuer.
The Administrator shall furnish to the Issuer or the Indenture Trustee from time
to time such additional information regarding the Related Agreements and the
Trust as each of them shall reasonably request.
Section 5.5. Independence of Administrator. For all purposes
of this Agreement, the Administrator shall be an independent contractor and
shall not be subject to the supervision of the Issuer or the Owner Trustee with
respect to the manner in which it accomplishes the performance of its
obligations hereunder. Unless expressly authorized by the Issuer, the
Administrator shall have no authority to act for or represent the Issuer or the
Owner Trustee in any way and shall not otherwise be deemed an agent of the
Issuer or the Owner Trustee.
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Section 5.6. No Joint Venture. Nothing contained in this
Agreement shall (i) constitute the Administrator and either of the Issuer or the
Owner Trustee as members of any partnership, joint venture, association,
syndicate, unincorporated business or other separate entity, (ii) be construed
to impose any liability as such on any of them or (iii) be deemed to confer on
any of them any express, implied or apparent authority to incur any obligation
or liability on behalf of the others.
Section 5.7. Other Activities of Administrator. Nothing herein
shall prevent the Administrator or its Affiliates from engaging in other
businesses or, in its sole discretion, from acting in a similar capacity as an
administrator for any other person or entity even though such person or entity
may engage in business activities similar to those of the Issuer, the Owner
Trustee or the Indenture Trustee.
Section 5.8. Termination, Resignation and Removal of
Administrator.
(a) Subject to subsection 5.8(d), the Administrator may resign
its duties hereunder by providing the Issuer with at least 60 days prior written
notice.
(b) Subject to subsection 5.8(d), and provided that TRS or an
Affiliate is not the Administrator, the Issuer or the Transferor may, with
written notice to each Note Rating Agency, remove the Administrator without
cause by providing the Administrator with at least 60 days prior written notice.
(c) Subject to subsection 5.8(d), at the sole option of the
Issuer or the Transferor and with written notice to each Note Rating Agency, the
Administrator may be removed immediately upon written notice of termination from
the Issuer to the Administrator if any of the following events shall occur:
(i) the Administrator shall default in the performance of
any of its duties under this Agreement and, after notice of such
default, shall not cure such default within 60 days (or, if such
default cannot be cured in such time, shall not give within 60 days
such assurance of cure as shall be reasonably satisfactory to the
Transferor and the Issuer);
(ii) a court having jurisdiction in the premises shall
enter a decree or order for relief, and such decree or order shall not
have been vacated within 60 days, in respect of the Administrator in
any involuntary case under any applicable bankruptcy, insolvency or
other similar law now or hereafter in effect or appoint a receiver,
liquidator, assignee, custodian, trustee, sequestrator or similar
official for the Administrator or any substantial part of its property
or order the winding-up or liquidation of its affairs; or
(iii) the Administrator shall commence a voluntary case
under any applicable bankruptcy, insolvency or other similar law now or
hereafter in effect, shall consent to the entry of an order for relief
in an involuntary case under any such law, or shall consent to the
appointment of a receiver, liquidator, assignee, trustee, custodian,
sequestrator or similar official for the Administrator or any
substantial part of its property, shall consent to the taking of
possession by any such official of any substantial part of its
property, shall make any general assignment for the benefit of its
creditors or shall fail generally to pay its debts as they become due.
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The Administrator agrees that if any of the events specified in clause
(ii) or (iii) of this subsection 5.8(c) shall occur, it shall give written
notice thereof to the Issuer, the Owner Trustee and the Indenture Trustee within
seven days after the happening of such event.
(d) No termination, resignation or removal of the
Administrator pursuant to this Section 5.8 shall be effective until (i) a
successor Administrator shall have been appointed by the Issuer and (ii) such
successor Administrator shall have agreed in writing to be bound by the terms of
this Agreement in the same manner as the Administrator is bound hereunder.
Section 5.9. Action Upon Termination, Resignation or Removal.
Promptly upon the effective date of termination of the Administrator pursuant to
subsection 5.8(c) or the resignation or removal of the Administrator pursuant to
subsection 5.8(a) or (b), respectively, the Administrator shall be entitled to
be paid all fees and reimbursable expenses accruing to it to the date of such
resignation or removal. The Administrator shall forthwith upon such termination
pursuant to subsection 5.8(c) deliver to the Issuer all property and documents
of or relating to the Collateral then in the custody of the Administrator. In
the event of the resignation or removal of the Administrator pursuant to
subsection 5.8(a) or (b), respectively, the Administrator shall cooperate with
the Issuer and take all reasonable steps requested to assist the Issuer in
making an orderly transfer of the duties of the Administrator.
[END OF ARTICLE V]
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ARTICLE VI
OTHER MATTERS RELATING TO EACH TRANSFEROR
Section 6.1. Liability of Each Transferor. Each Transferor
shall be severally, and not jointly, liable for all obligations, covenants,
representations and warranties of such Transferor arising under or related to
this Agreement. Each Transferor shall be liable only to the extent of the
obligations specifically undertaken by it in its capacity as a Transferor.
Section 6.2. Merger or Consolidation of, or Assumption of the
Obligations of, a Transferor.
(a) No Transferor shall dissolve, liquidate, consolidate with
or merge into any other Person or convey, transfer or sell its properties and
assets substantially as an entirety to any Person (in each case, a "Surviving
Entity") unless:
(i) (x) the Surviving Entity is organized and existing
under the laws of the United States of America or any state or the District of
Columbia, and either is a savings association, national banking association,
bank or other entity which is not eligible to be a debtor in a case under the
United States Bankruptcy Code or is a special purpose entity whose powers and
activities are limited, and shall expressly assume, by an agreement supplemental
hereto, executed and delivered to the Trust and the Indenture Trustee, in form
reasonably satisfactory to the Trust and the Indenture Trustee, the performance
of every covenant and obligation of such Transferor hereunder and shall benefit
from all the rights granted to such Transferor, as applicable hereunder; and (y)
such Transferor has delivered to the Owner Trustee and the Indenture Trustee an
Officer's Certificate of such Transferor and an Opinion of Counsel to the effect
that such consolidation, merger, conveyance, transfer or sale and such
supplemental agreement comply with this Section 6.2 and that such supplemental
agreement is a valid and binding obligation of the Surviving Entity, enforceable
against such Surviving Entity in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, receivership, conservatorship or other similar laws
affecting creditors' rights generally from time to time in effect and except as
such enforceability may be limited by general principles of equity;
(ii) all UCC filings, if any, required to perfect the
interest of the Trust in any Receivables and Collateral Certificates to be
conveyed by the Surviving Entity shall have been made and copies thereof shall
have been delivered to the Owner Trustee and the Indenture Trustee;
(iii) the Owner Trustee and the Indenture Trustee shall
have received one or more Opinions of Counsel to the effect that (a) under the
UCC, the transfer of Receivables and/or Collateral Certificates by the Surviving
Entity shall constitute either a sale of, or the granting of a security interest
in, such Receivables or Collateral Certificates, as the case may be, by the
Surviving Entity to the Trust, (b) the condition specified in paragraph (ii)
above shall have been satisfied, and (c) if the Surviving Entity shall be
subject to the FDIA, the interest of the Trust in such Receivables or Collateral
Certificates, as the case may be, should not be subject to avoidance by the FDIC
if the FDIC were to become the receiver or conservator of the Surviving Entity;
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(iv) the Owner Trustee and the Indenture Trustee shall
have received an Issuer Tax Opinion and any applicable Master Trust Tax Opinion;
and
(v) the Note Rating Agency Condition shall have been
satisfied with respect to such consolidation, merger, conveyance, transfer or
sale.
(b) The obligations of each Transferor hereunder shall not be
assignable nor shall any Person succeed to the obligations of any Transferor
hereunder except in each case in accordance with the provisions of the foregoing
paragraph or Section 6.5.
Section 6.3. Limitations on Liability of Each Transferor.
Subject to Section 6.1, no Transferor nor any of the directors, officers,
employees, members, incorporators or agents of any Transferor acting in such
capacities shall be under any liability to the Trust, the Owner Trustee, the
Indenture Trustee, the Noteholders, the Servicer, any Supplemental Credit
Enhancement Provider, any other Transferor or any other Person for any action
taken, or for refraining from the taking of any action, in good faith in such
capacities pursuant to this Agreement, it being expressly understood that all
such liability is expressly waived and released as a condition of, and
consideration for, the execution of this Agreement, the Indenture and any
Indenture Supplement and the issuance of the Notes; provided, however, that this
provision shall not protect any Transferor or any director, officer, employee,
member, incorporator or agent of any Transferor against any liability which
would otherwise be imposed by reason of willful misfeasance, bad faith or gross
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. Each Transferor and any director, officer,
employee, member, incorporator or agent of such Transferor may rely in good
faith on any document of any kind prima facie properly executed and submitted by
any Person (other than such Transferor) respecting any matters arising
hereunder.
Section 6.4. [Reserved].
Section 6.5. Assumption of a Transferor's Obligations.
Notwithstanding the provisions of Section 6.2, each Transferor may assign,
convey, transfer or sell all of its right, title and interest in, to and under
the Receivables and the Collateral Certificates in which it has an interest
and/or its interest in the Transferor Interest (collectively, the "Assigned
Assets"), together with all servicing functions and other obligations, if any,
under this Agreement or relating to the transactions contemplated hereby
(collectively, the "Assumed Obligations"), to another entity (the "Assuming
Entity") which may be an entity that is not affiliated with such Transferor, and
such Transferor may assign, convey and transfer the Assigned Assets and the
Assumed Obligations to the Assuming Entity, without the consent or approval of
the holders of any Notes, upon satisfaction of the following conditions:
(a) the Assuming Entity, such Transferor, the Trust and the
Indenture Trustee shall have entered into a supplement to this Agreement or an
assumption agreement (in form and substance reasonably satisfactory to the Trust
and the Indenture Trustee) (either, the "Assumption Agreement") providing for
the Assuming Entity to assume the Assumed Obligations, including the obligation
under this Agreement to transfer the Receivables arising under the Accounts, the
Receivables arising under any Additional Accounts and any Collateral
Certificates to the Trust, and such Transferor shall have delivered to the Owner
Trustee and the Indenture Trustee an Officer's Certificate of such Transferor
and an Opinion of Counsel each stating that such transfer and assumption comply
with this Section 6.5, that such Assumption Agreement is a valid and binding
obligation of such Assuming Entity, enforceable against such Assuming Entity in
accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium, receivership,
conservatorship or other similar laws affecting creditors' rights generally from
time to time in effect and except as such enforceability may be limited by
general principles of equity (whether considered in a suit at law or in equity),
and that all conditions precedent herein provided for relating to such
transaction have been complied with;
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(b) all UCC filings required to perfect the interest of the
Trust in the Receivables and/or the Collateral Certificates to be conveyed by
the Assuming Entity shall have been duly made and copies thereof shall have been
delivered to the Owner Trustee and the Indenture Trustee;
(c) (i) if the Assuming Entity shall not be eligible to be a
debtor under the United States Bankruptcy Code, such Transferor shall have
delivered notice of such transfer and assumption to each Note Rating Agency or
(ii) if the Assuming Entity shall be eligible to be a debtor in a case under the
United States Bankruptcy Code, such Transferor shall have delivered copies of
each such written notice to the Servicer, each other Transferor, the Owner
Trustee and the Indenture Trustee, and the Note Rating Agency Condition shall
have been satisfied;
(d) the Owner Trustee and the Indenture Trustee shall have
received one or more Opinions of Counsel to the effect that (i) the transfer of
Receivables and/or Collateral Certificates by the Assuming Entity shall
constitute either a sale of, or the granting of a security interest in, such
Receivables or Collateral Certificates, as the case may be, by the Assuming
Entity to the Trust, (ii) the condition specified in paragraph (b) above shall
have been satisfied, and (iii) if the Assuming Entity shall be subject to the
FDIA, the interest of the Trust in such Receivables or Collateral Certificates
should not be subject to avoidance by the FDIC if the FDIC were to become the
receiver or conservator of the Assuming Entity; and
(e) the Owner Trustee and the Indenture Trustee shall have
received an Issuer Tax Opinion and any applicable Master Trust Tax Opinion.
Upon such transfer to and assumption by the Assuming Entity,
such Transferor shall surrender the certificate, if applicable, evidencing its
interest in the Transferor Interest to the Note Registrar for registration of
transfer and the Note Registrar shall issue a new certificate, if applicable,
evidencing the Transferor Interest in the name of the Assuming Entity (or, if
applicable, register such Assuming Entity's uncertificated interest in the
Transferor Interest). Notwithstanding such assumption, such Transferor shall
continue to be liable for all representations and warranties and covenants made
by it and all obligations performed or to be performed by it in its capacity as
Transferor prior to such transfer.
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Section 6.6. Expenses. The Transferor shall pay out of its own
funds, without reimbursement, all expenses incurred in connection with the
Trust, including the costs of filing any amendment to UCC financing statements,
the costs and expenses relating to obtaining and maintaining the listing of any
Notes on any stock exchange, the fees and disbursements of the Administrator as
provided in Section 12.3, and any stamp, documentary, excise, property (whether
on real, personal or intangible property) or any similar tax levied on the Trust
or the Trust's assets that are not expressly stated in this Agreement to be
payable by the Trust or a Transferor. A Transferor's obligations pursuant to
this Section 6.6 shall not constitute a claim against such Transferor to the
extent such Transferor does not have funds sufficient to make payment of such
obligations.
[END OF ARTICLE VI]
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ARTICLE VII
OTHER MATTERS RELATING TO THE SERVICER
Section 7.1. Liability of the Servicer. The Servicer shall be
liable under this Article VII only to the extent of the obligations specifically
undertaken by the Servicer in its capacity as Servicer.
Section 7.2. Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer. The Servicer shall not consolidate with or merge
into any other Person or convey, transfer or sell its properties and assets
substantially as an entirety to any Person, unless:
(a) (i) the Person formed by such consolidation or into which
the Servicer is merged or the Person which acquires by conveyance,
transfer or sale the properties and assets of the Servicer
substantially as an entirety shall be, if the Servicer is not the
surviving entity, a corporation or a national banking association
organized and existing under the laws of the United States of America
or any state or the District of Columbia or is a special purpose entity
whose powers and activities are limited, and, if the Servicer is not
the surviving entity, such Person shall expressly assume, by an
agreement supplemental hereto, executed and delivered to the Trust and
the Indenture Trustee, in form satisfactory to the Trust and the
Indenture Trustee, the performance of every covenant and obligation of
the Servicer hereunder (to the extent that any right, covenant or
obligation of the Servicer, as applicable hereunder, is inapplicable to
the successor entity, such successor entity shall be subject to such
covenant or obligation, or benefit from such right, as would apply, to
the extent practicable, to such successor entity);
(ii) the Servicer has delivered to the Transferor,
the Owner Trustee and the Indenture Trustee an Officer's Certificate of
the Servicer and an Opinion of Counsel, each stating that such
consolidation, merger, conveyance, transfer or sale comply with this
Section 7.2 and that all conditions precedent herein provided for
relating to such transaction have been complied with; and
(iii) the Servicer shall have given the Note Rating Agencies
prompt notice of such consolidation, merger or transfer of assets; and
(b) the Person formed by such consolidation or into which the
Servicer is merged or the Person which acquires by conveyance, transfer or sale
the properties and assets of the Servicer substantially as an entirety shall be
or shall be immediately thereafter an Eligible Servicer.
Section 7.3. Limitation on Liability of the Servicer and
Others. Except as provided in Section 7.4, neither the Servicer nor any of the
directors, officers, employees, members or agents of the Servicer shall be under
any liability to the Trust, the Owner Trustee, the Indenture Trustee, the
Noteholders, the Transferor or any other Person for any action taken, or for
refraining from the taking of any action, in good faith in its capacity as
Servicer pursuant to this Agreement; provided, however, that this provision
shall not protect the Servicer or any directors, officers, employees, members or
agents of the Servicer against any liability which would otherwise be imposed by
reason of willful misfeasance, bad faith or gross negligence in the performance
of duties or by reason of reckless disregard of obligations and duties
hereunder. The Servicer and any director, officer, employee, member or agent of
the Servicer may rely in good faith on any document of any kind prima facie
properly executed and submitted by any Person (other than the Servicer)
respecting any matters arising hereunder. The Servicer shall not be under any
obligation to appear in, prosecute or defend any legal action which is not
incidental to its duties as Servicer in accordance with this Agreement and which
in its reasonable judgment may involve it in any expense or liability. The
Servicer may, in its sole discretion, undertake any such legal action which it
may deem necessary or desirable for the benefit of the Noteholders with respect
to this Agreement and the rights and duties of the parties hereto and the
interests of the Noteholders hereunder.
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Section 7.4. Servicer Indemnification of the Trust, the Owner
Trustee and the Indenture Trustee. To the fullest extent permitted by applicable
law, the Servicer shall indemnify and hold harmless each of the Transferor (in
the case of clause (a) below), the Trust, the Owner Trustee (as such and in its
individual capacity), the Indenture Trustee and any trustees predecessor thereto
(including the Indenture Trustee in its capacity as Note Registrar or as Paying
Agent) and their respective directors, officers, employees, members and agents
from and against any and all reasonable loss, liability, expense, damage or
injury arising out of or relating to any claims, actions or proceedings brought
or asserted by third parties which are suffered or sustained by reason of (a)
any acts or omissions of the Servicer with respect to the Trust pursuant to this
Agreement or (b) the administration of the Trust by the Owner Trustee, including
any judgment, award, settlement, reasonable attorneys' fees and other costs or
expenses incurred in connection with the defense of any action, proceeding or
claim; provided, however, that the Servicer shall not indemnify any Transferor,
the Trust, the Owner Trustee (as such or in its individual capacity), the
Indenture Trustee, any trustees predecessor thereto (including the Indenture
Trustee in its capacity as Note Registrar or as Paying Agent) or their
respective directors, officers, employees, members and agents, if such acts,
omissions or alleged acts or omissions constitute or are caused by negligence or
willful misconduct by such Transferor, the Trust, the Owner Trustee (as such or
in its individual capacity), the Indenture Trustee, any trustees predecessor
thereto (including the Indenture Trustee in its capacity as Note Registrar or as
Paying Agent) or their respective directors, officers, employees, members and
agents; provided further that the Servicer shall not indemnify the Trust for any
liabilities, costs or expenses of the Trust with respect to any action taken by
the Owner Trustee (as such or in its individual capacity), the Indenture
Trustee, any trustees predecessor thereto (including the Indenture Trustee in
its capacity as Note Registrar or as Paying Agent) or their respective
directors, officers, employees, members and agents at the request of the
Noteholders; provided further that the Servicer shall not indemnify the Trust as
to any losses, claims or damages incurred with respect to the investment in the
Trust Assets, including losses incurred as a result of Defaulted Accounts or
Defaulted Receivables or losses suffered by the Collateral Certificates; and
provided further that the Servicer shall not indemnify the Trust for any
liabilities, costs or expenses of the Trust arising under any tax law, including
any federal, state, local or foreign income or franchise taxes (or any interest
or penalties with respect thereto or arising from a failure to comply therewith)
required to be paid by the Trust in connection herewith to any taxing authority.
Any such indemnification shall not be payable from the Trust Assets, but shall
be payable only from the assets of the Servicer. The provisions of this
indemnity shall run directly to and be enforceable by an injured party subject
to the limitations hereof and shall survive the resignation or removal of the
Servicer, the resignation or removal of the Owner Trustee and the Indenture
Trustee and the termination of this Agreement.
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Section 7.5. Resignation of the Servicer. The Servicer shall
not resign from the obligations and duties hereby imposed on it except (a) upon
determination that (i) the performance of its duties hereunder is no longer
permissible under applicable law and (ii) there is no reasonable action which
the Servicer could take to make the performance of its duties hereunder
permissible under applicable law or (b) upon the assumption, by an agreement
supplemental hereto, executed and delivered to the Transferor, the Trust and the
Indenture Trustee, in form satisfactory to the Transferor, the Trust and the
Indenture Trustee, of the obligations and duties of the Servicer hereunder by
any of its Affiliates or by any other entity the appointment of which shall have
satisfied the Note Rating Agency Condition and, in either case, qualifies as an
Eligible Servicer. Any determination permitting the resignation of the Servicer
shall be evidenced as to clause (a) above by an Opinion of Counsel to such
effect delivered to the Transferor, the Owner Trustee and the Indenture Trustee.
No resignation shall become effective until the Indenture Trustee or a Successor
Servicer shall have assumed the responsibilities and obligations of the Servicer
in accordance with Section 9.2. If, within 120 days of the date of the
determination that the Servicer may no longer act as Servicer under clause (a)
above, the Indenture Trustee is unable to appoint a Successor Servicer, the
Indenture Trustee shall serve as Successor Servicer (but shall have continued
authority to appoint another Person as Successor Servicer). Notwithstanding the
foregoing, the Indenture Trustee shall, if it is legally unable so to act,
petition a court of competent jurisdiction at the expense of the resigning
Servicer to appoint any established institution qualifying as an Eligible
Servicer as the Successor Servicer hereunder. The Indenture Trustee shall give
prompt notice to each Note Rating Agency upon the appointment of a Successor
Servicer. Notwithstanding anything in this Agreement to the contrary, TRS,
Centurion or FSB, as Servicer, may assign part or all of its obligations and
duties as Servicer under this Agreement to an Affiliate of TRS so long as TRS,
Centurion or FSB, as the case may be, shall have fully guaranteed the
performance of such obligations and duties under this Agreement and such
assignment will not constitute a resignation within the meaning of this Section
7.5.
Section 7.6. Access to Certain Documentation and Information
Regarding the Collateral. The Servicer shall provide to the Trust and the
Indenture Trustee access to documentation regarding the Accounts, the
Receivables and the Collateral Certificates in such cases where the Indenture
Trustee is required in connection with the enforcement of the rights of
Noteholders or by applicable statutes or regulations to review such
documentation, such access being afforded without charge but only (a) upon
reasonable request, (b) during normal business hours, (c) subject to the
Servicer's normal security, data protection and confidentiality procedures or
such procedures as the Servicer may deem reasonably necessary and (d) at
reasonably accessible offices in the continental United States designated by the
Servicer. Nothing in this Section 7.6 shall derogate from the obligation of the
Transferor, the Trust, the Owner Trustee, the Indenture Trustee and the Servicer
to observe any applicable law prohibiting disclosure of information regarding
the Obligors, and the failure of the Servicer to provide access as provided in
this Section 7.6 as a result of such obligation shall not constitute a breach of
this Section 7.6.
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Section 7.7. Delegation of Duties. Subject to Section 13.8, in
the ordinary course of business, the Servicer may at any time delegate all or
part of its duties hereunder to any Person that agrees to conduct such duties in
accordance with the Account Guidelines and this Agreement. Any such delegation
shall not relieve the Servicer of its liability and responsibility with respect
to such duties, and shall not constitute a resignation within the meaning of
Section 7.5.
Section 7.8. Examination of Records. Each Transferor and the
Servicer shall indicate generally in their computer files or other records that
the Receivables arising in the Accounts have been conveyed to the Trust pursuant
to this Agreement and assigned to the Indenture Trustee under the Indenture.
Each Transferor and the Servicer shall, prior to the sale or transfer to a third
party of any receivable held in its custody, examine its computer records and
other records to determine that such receivable is not, and does not include, a
Receivable. Each Transferor and the Servicer shall also indicate generally in
their computer files or other records that each applicable Collateral
Certificate has been conveyed to the Trust pursuant to this Agreement and
assigned to the Indenture Trustee under the Indenture.
[END OF ARTICLE VII]
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ARTICLE VIII
INSOLVENCY EVENTS
Section 8.1. Rights Upon the Occurrence of an Insolvency Event. If any
Transferor or holder of the Transferor Interest shall consent to or fail to
object to the appointment of a bankruptcy trustee or conservator, receiver or
liquidator in any bankruptcy proceeding or other insolvency, readjustment of
debt, marshalling of assets and liabilities or similar proceedings of or
relating to such Transferor or such holder of the Transferor Interest or of or
relating to all or substantially all of such Person's respective property, or a
decree or order of a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of a bankruptcy trustee or
conservator, receiver or liquidator in any insolvency, readjustment of debt,
marshalling of assets and liabilities or similar proceedings, or for the
winding-up, insolvency, bankruptcy, reorganization, conservatorship,
receivership or liquidation of such Person's respective affairs, shall have been
entered against such Transferor or any holder of the Transferor Interest; or
such Transferor or such holder of the Transferor Interest shall admit in writing
its respective inability, or shall be unable, to pay its debts generally as they
become due, or file a petition to take advantage of any applicable bankruptcy,
insolvency, reorganization, receivership or conservatorship statute, make an
assignment for the benefit of its creditors or voluntarily suspend payment of
its obligations; or such Transferor or holder of the Transferor Interest shall
consent to, or fail to object to, the filing of any such petition, or, if such
Transferor or holder of the Transferor Interest shall so object to the filing of
any such petition, such petition shall not have been dismissed within 60 days of
the filing thereof (any such act or occurrence being an "Insolvency Event");
then each Transferor shall on the day any such Insolvency Event occurs (the
"Appointment Date"), immediately cease to (i) transfer Receivables or Collateral
Certificates and (ii) cause to be increased any Invested Amount of an existing
Collateral Certificate transferred to the Trust by such Transferor and shall
promptly give notice to the Owner Trustee, the Indenture Trustee and the
Servicer of such Insolvency Event. Notwithstanding any cessation of the transfer
to the Trust of additional Receivables, (i) Receivables transferred to the Trust
prior to the occurrence of such Insolvency Event, (ii) Collections in respect of
such Receivables and (iii) Collateral Certificates transferred to the Trust
prior to the occurrence of such Insolvency Event, shall continue to be a part of
the Trust Assets, and Collections with respect thereto shall continue to be
allocated to Noteholders in accordance with the terms of this Agreement, the
Indenture and each Indenture Supplement.
[END OF ARTICLE VIII]
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ARTICLE IX
SERVICER DEFAULTS
Section 9.1. Servicer Defaults. If any one of the following
events (a "Servicer Default") shall occur and be continuing:
(a) any failure by the Servicer to make any payment, transfer
or deposit or to give notice or instructions to the Indenture Trustee to make
any required payment, transfer or deposit on the date the Servicer is required
to do so under the terms of this Agreement, the Indenture or any applicable
Indenture Supplement, or within the applicable grace period, which will not
exceed 35 Business Days; provided, however, that any such failure caused by a
nonwillful act of the Servicer shall not constitute a Servicer Default if the
Servicer promptly remedies such failure within 35 Business Days after receiving
notice of such failure or otherwise becoming aware of such failure;
(b) failure on the part of the Servicer duly to observe or
perform in any material respect any other covenants or agreements of the
Servicer set forth in this Agreement which has an Adverse Effect on any
Noteholders and which continues unremedied for a period of 60 days after the
date on which written notice of such failure, requiring the same to be remedied,
shall have been given to the Servicer by the Owner Trustee or the Indenture
Trustee, or to the Servicer, the Owner Trustee and the Indenture Trustee by
Noteholders evidencing not less than 50% of the aggregate unpaid principal
amount of all Notes sustaining such Adverse Effect (or, with respect to any such
failure that does not relate to all Series, Classes or Tranches of Notes, not
less than 50% of the aggregate unpaid principal amount of all Series, Classes or
Tranches of Notes to which such failure related); or the Servicer shall assign
or delegate its duties under this Agreement, except as permitted by Sections
7.2, 7.5 and 7.7;
(c) any representation, warranty or certification made by the
Servicer in this Agreement or in any certificate delivered pursuant hereto shall
prove to have been incorrect when made, which has an Adverse Effect on the
rights of any Noteholders and which Adverse Effect continues for a period of 60
days after the date on which written notice thereof, requiring the same to be
remedied, shall have been given to the Servicer by the Owner Trustee or the
Indenture Trustee, or to the Servicer, the Owner Trustee and the Indenture
Trustee by Noteholders evidencing not less than 50% of the aggregate unpaid
principal amount of all Notes (or, with respect to any such representation,
warranty or certification that does not relate to all Series, Classes or
Tranches of Notes, not less than 50% of the aggregate unpaid principal amount of
all Series, Classes or Tranches of Notes adversely affected by such
representation, warranty or certification);
(d) the Servicer shall consent to the appointment of a
bankruptcy trustee or conservator or receiver or liquidator in any bankruptcy
proceeding or other insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to the Servicer or of or
relating to all or substantially all its property, or a decree or order of a
court or agency or supervisory authority having jurisdiction in the premises for
the appointment of a bankruptcy trustee or a conservator or receiver or
liquidator in any bankruptcy, insolvency, readjustment of debt, marshalling of
assets and liabilities or similar proceedings, or the winding-up or liquidation
of its affairs, shall have been entered against the Servicer and such decree or
order shall have remained in force undischarged or unstayed for a period of 60
days; or the Servicer shall admit in writing its inability to pay its debts
generally as they become due, file a petition to take advantage of any
applicable bankruptcy, insolvency or reorganization statute, make any assignment
for the benefit of its creditors or voluntarily suspend payment of its
obligations and such petition shall not have been dismissed within 60 days of
the filing thereof; or
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(e) any other Servicer Default described in any Indenture
Supplement;
then, in the event of any Servicer Default, so long as the
Servicer Default shall not have been remedied, either the Indenture Trustee or
Noteholders evidencing more than 50% of the aggregate unpaid principal amount of
all affected Notes, by notice then given in writing to the Servicer and the
Owner Trustee (and to the Indenture Trustee if given by the Noteholders) (a
"Termination Notice"), may terminate all but not less than all the rights and
obligations of the Servicer as Servicer under this Agreement; provided, however,
if within 60 days of receipt of a Termination Notice the Indenture Trustee does
not receive any bids from Eligible Servicers in accordance with subsection
9.2(d) to act as a Successor Servicer and receives an Officer's Certificate of
the Servicer to the effect that the Servicer cannot in good faith cure the
Servicer Default which gave rise to the Termination Notice, the Indenture
Trustee shall, except in the case of a Servicer Default set forth in subsection
9.1(d), grant the Transferor the right of first refusal to purchase the interest
of the Noteholders on the First Note Transfer Date in the next calendar month.
If the Transferor elects not to exercise such right of first refusal, the
Indenture Trustee shall assume the role of Successor Servicer.
The purchase price for the interest of the Noteholders shall
be equal to the sum of the amounts specified therefor with respect to each
Outstanding Series, Class or Tranche of Notes herein or in the applicable
Indenture Supplement. The Transferor shall notify the Indenture Trustee prior to
the Record Date for the First Note Transfer Date of the purchase if the
Transferor is exercising such right of first refusal. If the Transferor
exercises such right of first refusal, the Transferor shall deposit the purchase
price into the Collection Account on such First Note Transfer Date in
immediately available funds. The purchase price shall be allocated and
distributed to the Noteholders in accordance with the terms hereof or the
applicable Indenture Supplement.
After receipt by the Servicer of a Termination Notice, and on
the date that a Successor Servicer is appointed by the Indenture Trustee
pursuant to Section 9.2, all authority and power of the Servicer under this
Agreement shall pass to and be vested in the Successor Servicer (a "Service
Transfer") and, without limitation, the Indenture Trustee is hereby authorized
and empowered (upon the failure of the Servicer to cooperate) to execute and
deliver, on behalf of the Servicer, as attorney-in-fact or otherwise, all
documents and other instruments upon the failure of the Servicer to execute or
deliver such documents or instruments, and to do and accomplish all other acts
or things necessary or appropriate to effect the purposes of such Service
Transfer. The Servicer agrees to cooperate with the Indenture Trustee and such
Successor Servicer in effecting the termination of the responsibilities and
rights of the Servicer to conduct servicing hereunder, including the transfer to
such Successor Servicer of all authority of the Servicer to service the Trust
Assets provided for under this Agreement, including, without limitation, all
authority over all Collections which shall on the date of transfer be held by
the Servicer for deposit, or which have been deposited by the Servicer, in the
Collection Account, or which shall thereafter be received with respect to the
Trust Assets, and in assisting the Successor Servicer. The Servicer shall within
20 Business Days transfer its electronic records or electronic copies thereof
relating to the Trust Assets to the Successor Servicer in such electronic form
as the Successor Servicer may reasonably request and shall promptly transfer to
the Successor Servicer all other records, correspondence and documents necessary
for the continued servicing of the Trust Assets in the manner and at such times
as the Successor Servicer shall reasonably request. To the extent that
compliance with this Section 9.1 shall require the Servicer to disclose to the
Successor Servicer information of any kind which the Servicer deems to be
confidential, the Successor Servicer shall be required to enter into such
customary licensing, security, data protection and confidentiality agreements as
the Servicer shall deem reasonably necessary to protect its interests.
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Notwithstanding the foregoing, a delay in or failure of
performance referred to in paragraph (a) above for a period of 10 Business Days
after the applicable grace period or under paragraph (b) or (c) above for a
period of 60 Business Days after the applicable grace period, shall not
constitute a Servicer Default if such delay or failure could not be prevented by
the exercise of reasonable diligence by the Servicer and such delay or failure
was caused by an act of God or the public enemy, acts of declared or undeclared
war, public disorder, rebellion or sabotage, epidemics, landslides, lightning,
fire, hurricanes, earthquakes, floods or similar causes. The preceding sentence
shall not relieve the Servicer from using all commercially reasonable efforts to
perform its obligations in a timely manner in accordance with the terms of this
Agreement and the Servicer shall provide the Indenture Trustee, the Owner
Trustee and each Transferor with an Officer's Certificate of the Servicer giving
prompt notice of such failure or delay by it, together with a description of its
efforts so to perform its obligations.
Section 9.2. Indenture Trustee To Act; Appointment of
Successor.
(a) On and after the receipt by the Servicer of a Termination
Notice pursuant to Section 9.1, the Servicer shall continue to perform all
servicing functions under this Agreement until the date specified in the
Termination Notice or otherwise specified by the Indenture Trustee or until a
date mutually agreed upon by the Servicer and the Indenture Trustee. The
Indenture Trustee shall as promptly as possible after the giving of a
Termination Notice appoint an Eligible Servicer as a successor servicer (the
"Successor Servicer"), and such Successor Servicer shall accept its appointment
by a written assumption in a form acceptable to the Indenture Trustee and the
Transferor. The Transferor shall have the right to nominate to the Indenture
Trustee the name of a potential successor servicer, which nominee shall be
selected by the Indenture Trustee as the Successor Servicer. In the event that a
Successor Servicer has not been appointed or has not accepted its appointment at
the time when the Servicer ceases to act as Servicer, the Indenture Trustee
without further action shall automatically be appointed the Successor Servicer.
The Indenture Trustee may delegate any of its servicing obligations to an
Affiliate or agent in accordance with subsection 4.1(b) and Section 7.7.
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(b) Notwithstanding the foregoing, the Indenture Trustee
shall, if it is legally unable so to act, petition a court of competent
jurisdiction to appoint any established institution qualifying as an Eligible
Servicer as the Successor Servicer hereunder. The Indenture Trustee shall notify
each Note Rating Agency, the Owner Trustee, the Transferor and the Administrator
upon the removal of the Servicer and upon the appointment of a Successor
Servicer.
(c) Upon its appointment, the Successor Servicer shall be the
successor in all respects to the Servicer with respect to servicing functions
under this Agreement and shall be subject to all the responsibilities, duties
and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof, and all references in this Agreement to the Servicer shall be
deemed to refer to the Successor Servicer.
(d) In connection with any Termination Notice, the Indenture
Trustee will review any bids which it obtains from Eligible Servicers and shall
be permitted to appoint any Eligible Servicer submitting such a bid as a
Successor Servicer or, as provided in subsection 9.2(a), the Successor Servicer
nominated by the Transferor, for servicing compensation not in excess of the
Servicing Fee plus the sum of the amounts with respect to each Series and with
respect to each Payment Date equal to any Finance Charge Collections allocable
to Noteholders of such Series which are payable to the holders of the Transferor
Interest after payment of all amounts owing to the Noteholders of such Series
with respect to such Payment Date or required to be deposited in the applicable
Issuer Accounts or Sub-Accounts with respect to such Payment Date; provided,
however, that any holder of the Transferor Interest shall be responsible for
payment of its portion of such Servicing Fee and all other such amounts in
excess of such Servicing Fee. Each holder of the Transferor Interest agrees
that, if TRS (or any Successor Servicer) is terminated as Servicer hereunder,
the portion of the Collections in respect of Finance Charge Receivables that
such holder is entitled to receive pursuant to any Related Agreement shall be
reduced by an amount sufficient to pay the Transferor's share of the
compensation of the Successor Servicer.
(e) All authority and power granted to the Servicer under this
Agreement shall automatically cease and terminate upon termination of the Trust
pursuant to Article IX of the Trust Agreement, and shall pass to and be vested
in the Transferor and, without limitation, the Transferor is hereby authorized
and empowered to execute and deliver, on behalf of the Servicer as
attorney-in-fact or otherwise, all documents and other instruments, and to do
and accomplish all other acts or things necessary or appropriate to effect the
purposes of such transfer of servicing rights. The Servicer agrees to cooperate
with the Transferor in effecting the termination of the responsibilities and
rights of the Servicer to conduct servicing of the Receivables. The Servicer
shall transfer its electronic records relating to the Receivables to the
Transferor or its designee in such electronic form as it may reasonably request
and shall transfer all other records, correspondence and documents to it in the
manner and at such times as it shall reasonably request. To the extent that
compliance with this Section 9.2 shall require the Servicer to disclose to the
Transferor information of any kind which the Servicer deems to be confidential,
the Transferor shall be required to enter into such customary licensing,
security, data protection and confidentiality agreements as the Servicer shall
deem necessary to protect its interests.
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Section 9.3. Notification to Noteholders. Within five Business
Days after the Servicer becomes aware of any Servicer Default, the Servicer
shall give notice thereof to the Transferor, the Owner Trustee, the Indenture
Trustee and each Note Rating Agency, and the Indenture Trustee shall give notice
to the Noteholders. Upon any termination or appointment of a Successor Servicer
pursuant to this Article, the Indenture Trustee shall give prompt notice thereof
to the Noteholders.
Section 9.4. Waiver of Past Defaults. Noteholders evidencing
more than 66 2/3% of the aggregate unpaid principal amount of the Notes of each
Series or, with respect to any Series with two or more Classes or Tranches, of
each Class or Tranche, as applicable (or, with respect to any default that does
not relate to or affect all Series, 66 2/3% of the aggregate unpaid principal
balance of the Notes of each Series to which such default relates or, with
respect to any such Series with two or more Classes or Tranches, of each Class
or Tranche, as applicable) may, on behalf of all Noteholders of such Series,
Class or Tranche, waive any default by the Transferor or the Servicer in the
performance of its obligations hereunder and its consequences, except the
failure to make any required deposits or payments of interest or principal
relating to such Series, Class or Tranche pursuant to Article III. Upon any such
waiver of a past default, such default shall cease to exist, and any default
arising therefrom shall be deemed to have been remedied for every purpose of
this Agreement. No such waiver shall extend to any subsequent or other default
or impair any right consequent thereon except to the extent expressly so waived.
[END OF ARTICLE IX]
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ARTICLE X
ACQUISITION OF TRUST ASSETS
Section 10.1. Acquisition of Trust Assets. If a Master Trust
Transferor exercises its option to accept retransfer of any Collateral
Certificate pursuant to the terms of the related Series Supplement, the
Transferor shall cause such Master Trust Transferor to (a) acquire the
Collateral Certificate, which acquisition shall be effective as of the date on
which such retransfer occurs, (b) deliver notice of such acquisition to the
Owner Trustee, the Indenture Trustee, the other Master Trust Transferors, if
any, the Transferor and the Servicer on or prior to the Determination Date
following the applicable Monthly Period for which the option is deemed
exercised, (c) deposit in the Collection Account on or prior to the First Note
Transfer Date following the applicable Monthly Period an amount equal to the
Invested Amount of the existing Collateral Certificate on such date and all
other amounts payable to the Noteholders of each related Outstanding Series of
Notes including otherwise unpaid principal and accrued interest on the Notes.
Upon the completion of the foregoing condition, the applicable Master Trust
shall succeed to all interests in and to the Trust with respect to such
Collateral Certificate.
[END OF ARTICLE X]
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ARTICLE XI
TERMINATION
Section 11.1. Termination of Agreement. This Agreement and the
respective obligations and responsibilities of the Trust, each Transferor, the
Administrator and the Servicer under this Agreement shall terminate, except with
respect to the indemnification obligations described in Section 7.4, on the date
on which the Trust is dissolved in accordance with Article IX of the Trust
Agreement.
[END OF ARTICLE XI]
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ARTICLE XII
MISCELLANEOUS PROVISIONS
Section 12.1. Amendment; Waiver of Past Defaults.
(a) This Agreement may be amended from time to time by the
Servicer, the Transferor, the Issuer and the Indenture Trustee, by a written
instrument signed by each of them, without the consent of any of the
Noteholders; provided that (i) each Transferor shall have delivered to the
Indenture Trustee and the Owner Trustee an Officer's Certificate of such
Transferor, dated the date of any such amendment, stating that such Transferor
reasonably believes that such amendment will not have an Adverse Effect and (ii)
the Note Rating Agency Condition shall have been satisfied with respect to any
such amendment; provided further that such action shall not effect a significant
change in the Permitted Activities of the Trust except for those changes
necessary for compliance with accounting requirements or tax requirements or
required to cure any ambiguity or correct or supplement any provision contained
in this Agreement which may be defective or inconsistent with any provisions
thereof.
Additionally, notwithstanding any provision of this Article
XII to the contrary and in addition to the immediately preceding paragraph, this
Agreement may also be amended without the consent of any of the Noteholders,
upon delivery to the Owner Trustee and the Indenture Trustee of an Issuer Tax
Opinion and, to the extent a Collateral Certificate is included in the Trust
Assets, a Master Trust Tax Opinion, to provide for (i) the establishment of
multiple asset pools and the designation of Trust Assets to be included as part
of specific asset pools or (ii) those changes necessary for compliance with
securities law requirements; provided, however, that (i) the Issuer shall
deliver to the Indenture Trustee and the Owner Trustee an Officer's Certificate
to the effect that the Issuer reasonably believes that such amendment will not
have an Adverse Effect and is not reasonably expected to have an Adverse Effect
at any time in the future and (ii) each Note Rating Agency confirms in writing
that such amendment will not cause a Ratings Effect.
Any amendments regarding the addition or removal of
Receivables or Collateral Certificates from the Trust as provided herein,
executed in accordance with the provisions hereof, shall not be considered
amendments to this Agreement for the purpose of subsections 12.1(a) and (b).
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(b) This Agreement may also be amended in writing from time to
time by the Servicer, the Transferor, the Indenture Trustee and the Trust, (A)
in the case of a significant change in the Permitted Activities of the Trust
which is not materially adverse to any Noteholders, with the consent of
Noteholders evidencing not less than 50% of the aggregate unpaid principal
amount of all Series, Classes or Tranches of Notes affected by such change,
unless such change is necessary for compliance with accounting requirements or
tax requirements or required to cure any ambiguity or correct or supplement any
provision contained in this Agreement which may be defective or inconsistent
with any provisions thereof and (B) in all other cases, with the consent of
Noteholders evidencing more than 66 2/3% of the aggregate unpaid principal
amount of all affected Series, Classes or Tranches of Notes for which the
Transferor has not delivered an Officer's Certificate stating that there is no
Adverse Effect, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or of modifying in
any manner the rights of any Noteholders; provided, however, that no such
amendment shall (i) reduce in any manner the amount of or delay the timing of
any distributions (changes in Early Amortization Events or Events of Default
that decrease the likelihood of the occurrence thereof shall not be considered
delays in the timing of distributions for purposes of this clause) to be made to
Noteholders or deposits of amounts to be so distributed or the amount available
under any Supplemental Credit Enhancement Agreement and any Derivative Agreement
without the consent of each affected Noteholder, (ii) change the definition of
or the manner of calculating the interest of any Noteholder without the consent
of each affected Noteholder, (iii) reduce the aforesaid percentage required to
consent to any such amendment without the consent of each Noteholder or (iv)
adversely affect the rating of any Series, Class or Tranche of Notes by each
Note Rating Agency without the consent of Noteholders evidencing not less than
66 2/3% of the aggregate unpaid principal amount of such Series, Class or
Tranche (which shall not be deemed to occur if the Note Rating Agency Condition
shall have been satisfied with respect to such amendment).
(c) Promptly after the execution of any such amendment or
consent (other than an amendment pursuant to paragraph (a)), the Trust shall
furnish notification of the substance of such amendment to each Noteholder, and
the Servicer shall furnish notification of the substance of such amendment to
each Note Rating Agency and each Supplemental Credit Enhancement Provider.
(d) It shall not be necessary for the consent of Noteholders
under this Section 12.1 to approve the particular form of any proposed
amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Noteholders shall be subject to such
reasonable requirements as the Indenture Trustee may prescribe.
(e) Notwithstanding anything in this Section 12.1 (other than
subsection (h) below) to the contrary, no amendment may be made to this
Agreement which would adversely affect in any material respect the interests of
any Supplemental Credit Enhancement Provider without the consent of such
Supplemental Credit Enhancement Provider.
(f) Any Indenture Supplement executed in accordance with the
provisions of Article X of the Indenture shall not be considered an amendment of
this Agreement for the purposes of this Section 12.1. Any supplemental agreement
executed in accordance with the provisions of Section 6.2 or any Assumption
Agreement executed in accordance with the provisions of Section 6.5 shall not be
considered an amendment to this Agreement for purposes of this Section 12.1.
(g) The Owner Trustee and the Indenture Trustee may, but shall
not be obligated to, enter into any such amendment which adversely affects in
any material respect the rights, duties, benefits, protections, privileges or
immunities of the Owner Trustee or the Indenture Trustee, as applicable, under
this Agreement or otherwise. In connection with the execution of any amendment
hereunder, the Owner Trustee and the Indenture Trustee shall be entitled to
receive the Opinion of Counsel described in subsection 12.2(d).
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Section 12.2. Protection of Right, Title and Interest in and
to Trust Assets.
(a) The Transferor shall cause this Agreement, all amendments
and supplements hereto and all financing statements and amendments to financing
statements and any other necessary documents covering the right, title and
interest of the Trust and the Indenture Trustee to the Trust Assets to be
promptly recorded, registered and filed, and at all times to be kept recorded,
registered and filed, all in such manner and in such places as may be required
by law fully to preserve and protect such right, title and interest. The
Transferor shall deliver to the Owner Trustee and the Indenture Trustee
file-stamped copies of, or filing receipts for, any document recorded,
registered or filed as provided above, as soon as available following such
recording, registration or filing.
(b) Within 30 days after any Transferor makes any change in
its name or its type or jurisdiction of organization, such Transferor shall give
the Owner Trustee and the Indenture Trustee notice of any such change and shall
file such financing statements or amendments as may be necessary to continue the
perfection of the security interest or ownership interest of the Trust in the
Trust Assets.
(c) Each Transferor and the Servicer shall give the Owner
Trustee and the Indenture Trustee prompt written notice of any relocation of any
office from which it services Receivables or keeps records concerning the
Receivables and the Collateral Certificates or of its chief executive office and
whether, as a result of such relocation, the applicable provisions of the UCC
would require the filing of any amendment of any previously filed financing
statement or amendment thereto or of any new financing statement and shall file
such financing statements or amendments as may be necessary to perfect or to
continue the perfection of the security interest or ownership interest of the
Trust in the Trust Assets. Each Transferor and the Servicer shall at all times
maintain each office from which it services Receivables and its chief executive
offices within the United States and shall at all times be organized under the
laws of a jurisdiction located within the United States. Each of the Owner
Trustee and the Indenture Trustee shall give each Transferor and the Servicer
prompt notice of any change in its name or any change in its address as shown on
any financing statement filed in connection with the transactions contemplated
by any Related Agreement if the address so shown ceases to be an address from
which information concerning the Trust Assets can be obtained.
(d) The Transferor shall deliver to the Owner Trustee and the
Indenture Trustee (i) upon the execution and delivery of each amendment of this
Agreement pursuant to Section 12.1, an Opinion of Counsel to the effect
specified in Exhibit F-1; (ii) on each Addition Date with respect to the
addition of Aggregate Addition Accounts to be designated to the Trust pursuant
to subsection 2.13(a) or (b), an Opinion of Counsel substantially in the form of
Exhibit F-2; (iii) semi-annually (or, if the applicable Account Owner has a
long-term rating below "A" by Xxxxx'x, "AA-" by Standard & Poor's or, if rated
by Fitch, "AA-" by Fitch, quarterly), beginning six months following the end of
the first Monthly Period in which New Accounts are designated to the Trust
pursuant to subsection 2.13(d), an Opinion of Counsel substantially in the form
of Exhibit F-3; (iv) on each Addition Date on which any Collateral Certificate
is included as part of the Trust Assets pursuant to subsection 2.13(a) or (b),
an Opinion of Counsel covering the same substantive legal issues addressed by
Exhibit F-2; (v) on or before March 31 of each year, beginning with March 31,
2006, an Opinion of Counsel substantially in the form of Exhibit F-4; and (iii)
in connection with the occurrence of any event contemplated in Section 6.2 or
6.5, the Opinions of Counsel, the Issuer Tax Opinion and the Master Trust Tax
Opinion specified therein.
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Section 12.3. Fees Payable by the Transferor. Notwithstanding
anything contained in any other Transaction Document (unless such document
specifically refers to this Section 12.3), the Transferor shall pay out of its
own funds, without reimbursement, all expenses incurred, fees and disbursements
of the Owner Trustee (as such and in its individual capacity), the Administrator
and the Indenture Trustee (including, in each case, the reasonable fees and
expenses of its outside counsel) and independent accountants and all other fees
and expenses relating to the Trust, including the costs of filing UCC
continuation statements, the costs and expenses relating to obtaining and
maintaining the listing of any Notes on any stock exchange, the costs and
expenses relating to maintaining Issuer Accounts, and any stamp, documentary,
excise, property (whether on real, personal or intangible property) or any
similar tax levied on the Trust or the Trust's assets that are not expressly
stated in this Agreement to be payable by the Trust (other than federal, state,
local and foreign income and franchise taxes, if any, or any interest or
penalties with respect thereto, assessed on the Trust, which shall be paid by
the Trust).
Section 12.4. Governing Law; Submission to Jurisdiction;
Appointment of Agent for Service of Process. This Agreement shall be governed by
and construed in accordance with the laws of the State of Delaware, without
regard to principles of conflict of laws. The parties hereto hereby declare that
it is their intention that this Agreement shall be regarded as made under the
laws of the State of Delaware and that the laws of said State shall be applied
in interpreting its provisions in all cases where legal interpretation shall be
required. Each of the parties hereto agrees (a) that this Agreement involves at
least $100,000.00, and (b) that this Agreement has been entered into by the
parties hereto in express reliance upon 6 Del. C. ss. 2708. Each of the parties
hereto hereby irrevocably and unconditionally agrees (a) to be subject to the
jurisdiction of the courts of the State of Delaware and of the federal courts
sitting in the State of Delaware, and (b) (1) to the extent such party is not
otherwise subject to service of process in the State of Delaware, to appoint and
maintain an agent in the State of Delaware as such party's agent for acceptance
of legal process, and (2) that, to the fullest extent permitted by applicable
law, service of process may also be made on such party by prepaid certified mail
with a proof of mailing receipt validated by the United States Postal Service
constituting evidence of valid service, and that service made pursuant to (b)
(1) or (2) above shall, to the fullest extent permitted by applicable law, have
the same legal force and effect as if served upon such party personally within
the State of Delaware.
Section 12.5. Notices; Payments.
(a) All demands, notices, instructions, directions and
communications (collectively, "Notices") under this Agreement shall be in
writing and shall be deemed to have been duly given if personally delivered at,
mailed by certified mail, return receipt requested, or sent by facsimile
transmission or sent by electronic mail:
(i) in the case of TRS, as the Servicer or the Administrator,
to:
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AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Secretary
Fax: (000) 000-0000
(ii) in the case of RFC V, as a Transferor, to:
AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION V LLC
000 Xxxxx Xxxxxx, Xxxx 000X
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
Fax: (000) 000-0000
(iii) in the case of the Trust or the Owner Trustee, to:
Wilmington Trust Company
Xxxxxx Square North
0000 Xxxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Fax: (000) 000-0000
(iv) in the case of the Indenture Trustee, to:
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 0 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Asset Backed Unit
Fax: (000) 000-0000
xxxxxxxxx@xxxxxxxx.xxx
(v) in the case of the Note Rating Agency for a particular
Series, the address, if any, specified in the Indenture Supplement relating to
such Series, and
(vi) to any other Person as specified in the Indenture; or, as
to each party, at such other address, facsimile number or electronic mail
address as shall be designated by such party in a written notice to each other
party.
(b) Any Notice required or permitted to be given to a Holder
of Notes that are Registered Notes shall be given by first-class mail, postage
prepaid, at the address of such Holder as shown in the Note Register. No Notice
shall be required to be mailed to a Holder of Notes that are Bearer Notes but
shall be given as provided below. Any Notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given, whether or not the Noteholder receives such Notice. In addition, (a) if
and so long as any Series, Class or Tranche of Notes is listed on the Luxembourg
Stock Exchange and such stock exchange shall so require, any Notice to
Noteholders shall be published in an Authorized Newspaper of general circulation
in Luxembourg within the time period prescribed in this Agreement and (b) in the
case of any Series, Class or Tranche of Notes with respect to which any Bearer
Notes are Outstanding, any Notice required or permitted to be given to Holders
of such Series, Class or Tranche shall be published in an Authorized Newspaper
within the time period prescribed in this Agreement.
88
Section 12.6. Severability of Provisions. If any one or more
of the covenants, agreements, provisions or terms of this Agreement shall for
any reason whatsoever be held invalid, then such provisions shall be deemed
severable from the remaining provisions of this Agreement and shall in no way
affect the validity or enforceability of the remaining provisions or of the
Notes or the rights of any Noteholders.
Section 12.7. Further Assurances. Each Transferor and the
Servicer agree to do and perform, from time to time, any and all acts and to
execute any and all further instruments required or reasonably requested by the
Owner Trustee and the Indenture Trustee more fully to effect the purposes of
this Agreement, including the authorization and/or filing of any financing
statements or amendments thereto relating to the Receivables and/or the
Collateral Certificates for filing under the provisions of the UCC of any
applicable jurisdiction.
Section 12.8. No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of the Trust, the Owner
Trustee, the Indenture Trustee or any Noteholders, any right, remedy, power or
privilege under this Agreement shall operate as a waiver thereof; nor shall any
single or partial exercise of any right, remedy, power or privilege under this
Agreement preclude any other or further exercise thereof or the exercise of any
other right, remedy, power or privilege. The rights, remedies, powers and
privileges provided under this Agreement are cumulative and not exhaustive of
any rights, remedies, powers and privileges provided by law.
Section 12.9. 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 12.10. Third-Party Beneficiaries. This Agreement will
inure to the benefit of and be binding upon the parties hereto, the Noteholders,
any Supplemental Credit Enhancement Providers, any Derivative Counterparties and
their respective successors and permitted assigns. Except as otherwise expressly
provided in this Agreement, no other Person will have any right or obligation
hereunder.
Section 12.11. Actions by Noteholders.
(a) Wherever in this Agreement a provision is made that an
action may be taken or a Notice, demand or instruction given by Noteholders,
such action, Notice, demand or instruction may be taken or given by any
Noteholder, unless such provision requires a specific percentage of Noteholders.
(b) Any Notice, request, demand, authorization, direction,
consent, waiver or other act by a Noteholder shall bind such Noteholder and
every subsequent Holder of such Note and of any Note issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done or omitted to be done by the Owner Trustee, the
Indenture Trustee, any Transferor or the Servicer in reliance thereon, whether
or not notation of such action is made upon such Note.
89
Section 12.12. Rule 144A Information. For so long as any of
the Notes are "restricted securities" within the meaning of Rule 144(a)(3) under
the Securities Act, each Transferor and each of the Owner Trustee, the Indenture
Trustee and the Servicer agree to cooperate with each other to provide to any
Holders of such Series, Class or Tranche and to any prospective purchaser of
Assets Pool One Notes designated by such Noteholder, upon the request of such
Noteholder or prospective purchaser, any information required to be provided to
such Holder or prospective purchaser to satisfy the condition set forth in Rule
144A(d)(4) under the Securities Act.
Section 12.13. Merger and Integration. Except as specifically
stated otherwise herein, this Agreement sets forth the entire understanding of
the parties relating to the subject matter hereof, and all prior understandings,
written or oral, are superseded by this Agreement. This Agreement may not be
modified, amended, waived or supplemented except as provided herein.
Section 12.14. Headings. The headings herein are for purposes
of reference only and shall not otherwise affect the meaning or interpretation
of any provision hereof.
Section 12.15. Limitation of Liability. Notwithstanding any
other provision herein or elsewhere, this Agreement has been executed and
delivered by Wilmington Trust Company, not in its individual capacity, but
solely in its capacity as Owner Trustee of the Trust. In no event shall
Wilmington Trust Company in its individual capacity have any liability in
respect of the representations, warranties, or obligations of the Trust
hereunder or under any other document, as to all of which recourse shall be had
solely to the Trust Assets, and for all purposes of this Agreement and each
other document, the Owner Trustee (as such or in its individual capacity) shall
be subject to, and entitled to the benefits of, the terms and provisions of the
Trust Agreement.
Section 12.16. No Petition. To the fullest extent permitted by
applicable law, the Indenture Trustee, the Servicer and each Transferor, by
entering into this Agreement, and each Noteholder, by accepting a Note, agrees
that it will not at any time institute against any Master Trust or the Issuer,
or join in any institution against any Master Trust or the Issuer of, any
bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings,
or other proceedings under any United States federal or state bankruptcy or
similar law in connection with any obligations relating to the Notes and this
Agreement.
90
Section 12.17. Force Majeure. In no event shall the Indenture
Trustee or the Owner Trustee be responsible or liable for any failure or delay
in the performance of its obligations hereunder arising out of or caused by,
directly or indirectly, forces beyond its control, including, without
limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil
or military disturbances, nuclear or natural catastrophes or acts of God, and
interruptions, loss or malfunctions of utilities, communications or computer
(software and hardware) services; it being understood that the Indenture Trustee
and the Owner Trustee shall use reasonable efforts which are consistent with
accepted practices in the banking industry to resume performance as soon as
practicable under the circumstances.
[END OF ARTICLE XII]
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ARTICLE XIII
COMPLIANCE WITH REGULATION AB
Section 13.1. Intent of the Parties; Reasonableness. The
Transferor, the Servicer, the Issuer and the Indenture Trustee acknowledge and
agree that the purpose of this Article XIV is to facilitate compliance by the
Transferor with the provisions of Regulation AB and related rules and
regulations of the Commission. The Transferor shall not exercise its right to
request delivery of information or other performance under these provisions
other than in good faith, or for purposes other than the Transferor's compliance
with the Securities Act, the Exchange Act and the rules and regulations of the
Commission thereunder (or the provision in a private offering of disclosure
comparable to that required under the Securities Act). The Indenture Trustee
acknowledges that interpretations of the requirements of Regulation AB may
change over time, whether due to interpretive guidance provided by the
Commission or its staff, consensus among participants in the asset-backed
securities markets, advice of counsel, or otherwise, and agrees to comply with
requests made by the Transferor in good faith for delivery of information under
these provisions on the basis of evolving interpretations of Regulation AB. The
Indenture Trustee agrees to cooperate in good faith with any reasonable request
by the Transferor for information regarding the Indenture Trustee which is
required in order to enable the Transferor to comply with the provisions of
Items 1103(a)(1), 1109(a), 1109(b), 1117, 1118, 1119 and 1122 of Regulation AB
as it relates to the Indenture Trustee or to the Indenture Trustee's obligations
under this Agreement. The Servicer agrees to cooperate in good faith with any
reasonable request by the Transferor for information regarding the Servicer
which is required in order to enable the Transferor to comply with the
provisions of Items 1103(a)(1), 1105, 1108, 1117, 1118, 1119, 1121, 1122 and
1123 of Regulation AB as it relates to the Servicer or to the Servicer's
obligations under this Agreement.
Section 13.2. Additional Representations and Warranties of the
Indenture Trustee. The Indenture Trustee shall be deemed to represent to the
Transferor, as of the date on which information is provided to the Transferor
under Section 13.3 that, except as disclosed in writing to the Transferor prior
to such date to the best of its knowledge, but without independent
investigation: (i) neither the execution, delivery and performance by the
Indenture Trustee of this Agreement, the performance by the Indenture Trustee of
its obligations under this Agreement nor the consummation of any of the
transactions by the Indenture Trustee contemplated thereby, is in violation of
any indenture, mortgage, bank credit agreement, note or bond purchase agreement,
long-term lease, license or other agreement or instrument to which the Indenture
Trustee is a party or by which it is bound, which violation would have a
material adverse effect on the Indenture Trustee's ability to perform its
obligations under this Agreement, or of any judgment or order applicable to the
Indenture Trustee; and (ii) there are no proceedings pending or threatened
against the Indenture Trustee in any court or before any governmental authority,
agency or arbitration board or tribunal which, individually or in the aggregate,
would have a material adverse effect on the right, power and authority of the
Indenture Trustee to enter into this Agreement or to perform its obligations
under this Agreement.
Section 13.3. Information to Be Provided by the Indenture
Trustee. The Indenture Trustee shall (i) on or before the fifth Business Day of
each month, provide to the Transferor, in writing, such information regarding
the Indenture Trustee as is requested for the purpose of compliance with Item
1117 of Regulation AB, and (ii) as promptly as practicable following notice to
or discovery by the Indenture Trustee of any changes to such information,
provide to the Transferor, in writing, such updated information.
92
The Indenture Trustee shall (i) on or before the fifth
Business Day of each January, April, July and October, provide to the Transferor
such information regarding the Indenture Trustee as is requested for the purpose
of compliance with Items 1103(a)(1), 1109(a), 1109(b), 1118 and 1119 of
Regulation AB, and (ii) as promptly as practicable following notice to or
discovery by the Indenture Trustee of any changes to such information, provide
to the Transferor, in writing, such updated information. Such information shall
include, at a minimum:
(A) the Indenture Trustee's name and form of
organization;
(B) a description of the extent to which the
Indenture Trustee has had prior experience serving as an
Indenture Trustee for asset-backed securities transactions
involving credit or charge card receivables;
(C) a description of any affiliation between the
Indenture Trustee and any of the following parties to a
Securitization Transaction, as such parties are identified to
the Indenture Trustee by the Transferor in writing in advance
of such Securitization Transaction:
(1) the sponsor;
(2) any depositor;
(3) the issuing entity;
(4) any servicer;
(5) any trustee;
(6) any originator;
(7) any significant obligor;
(8) any enhancement or support provider; and
(9) any other material transaction party.
In connection with the above-listed parties, a description of
whether there is, and if so the general character of, any
business relationship, agreement, arrangement, transaction or
understanding that is entered into outside the ordinary course
of business or is on terms other than would be obtained in an
arm's length transaction with an unrelated third party, apart
from the asset-backed securities transaction, that currently
exists or that existed during the past two years and that is
material to an investor's understanding of the asset-backed
securities.
Section 13.4. Report on Assessment of Compliance and
Attestation. On or before the earlier of (a) March 1 and (b) 30 days prior to
the date on which the Trust is required to file the report on Form 10-K in each
calendar year, commencing in 2007, the Indenture Trustee shall:
(i) deliver to the Transferor a report regarding the Indenture
Trustee's assessment of compliance with the Servicing Criteria during
the immediately preceding calendar year, as required under Rules 13a-18
and 15d-18 of the Exchange Act and Item 1122 of Regulation AB. Such
report shall be addressed to the Transferor or the Servicer, as
applicable, and signed by an authorized officer of the Indenture
Trustee, and shall address each of the Servicing Criteria specified in
Exhibit H or such criteria as mutually agreed upon by the Transferor
and the Indenture Trustee;
93
(ii) deliver to the Transferor a report of a registered public
accounting firm reasonably acceptable to the Transferor that attests
to, and reports on, the assessment of compliance made by the Indenture
Trustee and delivered pursuant to the preceding paragraph. Such
attestation shall be in accordance with Rules 1-02(a)(3) and 2-02(g) of
Regulation S-X under the Securities Act and the Exchange Act; and
(iii) deliver to the Transferor and any other Person that will
be responsible for signing the certification (a "Sarbanes
Certification") required by Rules 13a-14(d) and 15d-14(d) under the
Exchange Act (pursuant to Section 302 of the Xxxxxxxx-Xxxxx Act of
2002) on behalf of the Trust or the Transferor with respect to a
Securitization Transaction a certification substantially in the form
attached hereto as Exhibit G or such form as mutually agreed upon by
the Transferor and the Indenture Trustee.
The Indenture Trustee acknowledges that the parties identified
in clause (iii) above may rely on the certification provided by the Indenture
Trustee pursuant to such clause in signing a Sarbanes Certification and filing
such with the Commission.
Section 13.5. Additional Representations and Warranties of the
Servicer. The Servicer shall be deemed to represent to the Transferor, as of the
date on which information is provided to the Transferor under Section 13.6 that,
except as disclosed in writing to the Transferor prior to such date to the best
of its knowledge: (i) the Servicer is not aware and has not received notice that
any default, early amortization or other performance triggering event has
occurred as to any other securitization due to any act or failure to act of the
Servicer; (ii) the Servicer has not been terminated as servicer in a
securitization involving credit card or charge card receivables, either due to a
servicing default or to application of a servicing performance test or trigger;
(iii) no material noncompliance with the applicable servicing criteria with
respect to other securitizations of credit card receivables involving the
Servicer as servicer has been disclosed or reported by the Servicer; (iv) no
material changes to the Servicer's policies or procedures with respect to the
servicing function it will perform under this Agreement have occurred during the
three-year period immediately preceding the related Securitization Transaction;
(v) there are no aspects of the Servicer's financial condition that could have a
material adverse effect on the performance by the Servicer of its servicing
obligations under this Agreement; and (vi) there are no material legal or
governmental proceedings pending (or known to be contemplated) against the
Servicer, any Subservicer or any unaffiliated third-party originator of
Receivables.
Section 13.6. Information to Be Provided by the Servicer. In
connection with any Securitization Transaction, the Servicer shall (i) within
five (5) Business Days following a request by the Transferor, provide to the
Transferor, in writing, the information specified in this Section, and (ii) as
promptly as practicable following notice to or discovery by the Servicer of any
changes to such information, provide to the Transferor, in writing, such updated
information.
94
(a) If so requested by the Transferor, the Servicer shall
provide to the Transferor such information regarding the Servicer and each
Subservicer (each of the Servicer and each Subservicer, for purposes of this
paragraph, a "Servicing Party"), as is requested for the purpose of compliance
with Item 1108 of Regulation AB. Such information shall include, at a minimum:
(A) the Servicing Party's name and form of organization;
(B) a description of how long the Servicing Party has been
servicing credit or charge card receivables; a general discussion of
the Servicing Party's experience in servicing assets of any type as
well as a more detailed discussion of the Servicing Party's experience
in, and procedures for, the servicing function it will perform under
this Agreement; information regarding the size, composition and growth
of the Servicing Party's portfolio of credit card accounts of a type
similar to the Accounts and information on factors related to the
Servicing Party that may be material, in the good faith judgment of the
Transferor, to any analysis of the servicing of the Receivables or the
related asset-backed securities, as applicable, including, without
limitation:
(1) whether any prior securitizations of credit or
charge card receivables involving the Servicing Party
defaulted or experienced an early amortization or other
performance triggering event because of servicing during
the three-year period immediately preceding the related
Securitization Transaction;
(2) the extent of outsourcing the Servicing Party
utilizes;
(3) whether there has been previous disclosure of
material noncompliance with the applicable servicing
criteria with respect to other securitizations of credit
card receivables involving the Servicing Party as a
servicer during the three-year period immediately
preceding the related Securitization Transaction;
(4) whether the Servicing Party has been terminated as
servicer in a securitization of credit or charge card
receivables, either due to a servicing default or to
application of a servicing performance test or trigger;
and
(5) such other information as the Transferor may
reasonably request for the purpose of compliance with Item
1108(b)(2) of Regulation AB;
(C) a description of any material changes during the
three-year period immediately preceding the related Securitization
Transaction to the Servicing Party's policies or procedures with
respect to the servicing function it will perform under this Agreement;
95
(D) information regarding the Servicing Party's financial
condition, to the extent that there is a material risk that an adverse
financial event or circumstance involving the Servicing Party could
have a material adverse effect on the performance by the Servicing
Party of its servicing obligations under this Agreement;
(E) a description of the Servicing Party's processes and
procedures designed to address any special or unique factors involved
in servicing;
(F) a description of the Servicing Party's processes for
handling delinquencies, losses, bankruptcies and recoveries, such as
sale of defaulted receivables; and
(G) information as to how the Servicing Party defines or
determines delinquencies and charge-offs, including the effect of any
grace period, re-aging, restructuring, partial payments considered
current or other practices with respect to delinquency and loss
experience.
(b) As a condition to the succession to the Servicer or
any Subservicer as servicer or subservicer under this Agreement by any Person
(i) into which the Servicer or such Subservicer may be merged or consolidated,
or (ii) which may be appointed as a successor to the Servicer or such
Subservicer, the Servicer shall provide to the Transferor at least fifteen (15)
calendar days prior to the effective date of such succession or appointment, (x)
written notice to the Transferor of such succession or appointment and (y) in
writing and in form and substance reasonably satisfactory to the Transferor, all
information reasonably requested by the Transferor in order to comply with its
reporting obligation under Item 6.02 of Form 8-K with respect to any Series,
Class or Tranche.
(c) In addition to such information as the Servicer is
obligated to provide pursuant to other provisions of this Agreement, if so
requested by the Transferor, the Servicer shall provide to the Transferor such
information regarding the performance or servicing of the Receivables as is
reasonably required to facilitate preparation of distribution reports in
accordance with Item 1121 of Regulation AB. Such information shall be provided
concurrently with the distribution reports otherwise required to be delivered
monthly by the Servicer under this Agreement, commencing with the first such
report due not less than ten (10) Business Days following such request.
Section 13.7. Report on Assessment of Compliance and
Attestation.
(a) On or before the earlier of (a) March 1 and (b) 30
days prior to the date on which the Trust is required to file the report on Form
10-K in each calendar year, commencing in 2007, the Servicer shall:
(i) deliver to the Transferor a report regarding the
Servicer's assessment of compliance with the Servicing
Criteria during the immediately preceding calendar year, as
required under Rules 13a-18 and 15d-18 of the Exchange Act and
Item 1122 of Regulation AB. Such report shall be addressed to
the Transferor and signed by an authorized officer of the
Servicer, and shall address each of the Servicing Criteria
specified in Exhibit J or such criteria as mutually agreed
upon by the Transferor and the Servicer;
96
(ii) deliver to the Transferor a report of a
registered public accounting firm reasonably acceptable to the
Transferor that attests to, and reports on, the assessment of
compliance made by the Servicer and delivered pursuant to the
preceding paragraph. Such attestation shall be in accordance
with Rules 1-02(a)(3) and 2-02(g) of Regulation S-X under the
Securities Act and the Exchange Act;
(iii) cause each Servicing Participant to deliver to
the Transferor an assessment of compliance and accountants'
attestation as and when provided in paragraphs (i) and (ii) of
this Section; and
(iv) deliver to the Transferor and any other Person
that will be responsible for signing the Sarbanes
Certification on behalf of the Trust or the Transferor with
respect to a Securitization Transaction a certification in the
form attached hereto as Exhibit I.
The Servicer acknowledges that the parties identified in
clause (iv) above may rely on the certification provided by the Servicer
pursuant to such clause in signing a Sarbanes Certification and filing such with
the Commission.
(b) Each assessment of compliance provided by a
Subservicer pursuant to Section 13.7(a)(i) shall address each of the Servicing
Criteria specified on a certification substantially in the form of Exhibit K
hereto delivered to the Transferors upon reasonable request of the Transferor
after the execution of this Agreement or, in the case of a Subservicer
subsequently appointed as such, on or prior to the date of such appointment. An
assessment of compliance provided by a Servicing Participant (other than the
Servicer or any Subservicer) pursuant to Section 13.7(a)(iii) need not address
any elements of the Servicing Criteria other than those specified by the
Servicer pursuant to Section 13.8.
Section 13.8. Use of Subservicers and Servicing
Participants. The Servicer shall use its best efforts to hire or otherwise
utilize only the services of Subservicers that agree to comply with the
provisions of paragraph (a) of this Section. The Servicer shall use its best
efforts to hire or otherwise utilize only the services of Servicing
Participants, and shall use its best efforts to ensure that Subservicers hire or
otherwise utilize only the services of Servicing Participants, to fulfill any of
the obligations of the Servicer as servicer under this Agreement, if those
Servicing Participants agree to comply with the provisions of paragraph (b) of
this Section.
(a) It shall not be necessary for the Servicer to seek the
consent of the Transferor to the utilization of any Subservicer. The Servicer
shall use its best efforts to cause any Subservicer used by the Servicer (or by
any Subservicer) for the benefit of the Transferor to comply with the provisions
of this Section and with Sections 4.4, 13.5, 13.6(c) and (d) and 13.7(a)(i) and
(ii) of this Agreement to the same extent as if such Subservicer were the
Servicer. The Servicer shall be responsible for obtaining from each Subservicer
and delivering to the Transferor any servicer compliance statement required to
be delivered by such Subservicer under Section 4.4, any assessment of compliance
and attestation required to be delivered by such Subservicer under Section
13.7(a)(i) or (ii) and the certification, if any, required to be delivered to
the Person that will be responsible for signing the Sarbanes Certification under
Section 13.7 as and when required to be delivered.
97
(b) It shall not be necessary for the Servicer to seek the
consent of the Transferor to the utilization of any Servicing Participant. The
Servicer shall promptly upon request provide to the Transferors a written
description (in form and substance satisfactory to the Transferor) of the role
and function of each Servicing Participant utilized by the Servicer or any
Subservicer, specifying (i) the identity of each such Servicing Participant and
(ii) which elements of the Servicing Criteria will be addressed in assessments
of compliance provided by each Servicing Participant.
(c) As a condition to the utilization of any Servicing
Participant, the Servicer shall use its best efforts to cause any such Servicing
Participant used by the Servicer (or by any Subservicer) for the benefit of the
Transferors to comply with the provisions of Section 13.7 of this Agreement to
the same extent as if such Servicing Participant were the Servicer. The Servicer
shall be responsible for obtaining from each Servicing Participant and
delivering to the Transferors any assessment of compliance and attestation
required to be delivered by such Servicing Participant under Section 13.7, in
each case as and when required to be delivered.
98
IN WITNESS WHEREOF, the Transferor, the Servicer, the
Indenture Trustee and the Trust have caused this Agreement to be executed by
their respective officers as of the day and year first above written.
AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION V LLC,
as Transferor
By:
--------------------------------
Name:
Title:
AMERICAN EXPRESS TRAVEL RELATED SERVICES
COMPANY, INC.,
as Servicer and Administrator
By:
--------------------------------
Name:
Title:
AMERICAN EXPRESS ISSUANCE TRUST
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely
as Owner Trustee on behalf of the Trust
By:
--------------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Indenture Trustee
By:
--------------------------------
Name:
Title:
99
EXHIBIT A
FORM OF ASSIGNMENT OF RECEIVABLES IN AGGREGATE ADDITION ACCOUNTS
INCLUDED IN AMERICAN EXPRESS ISSUANCE TRUST
(as required by section 2.13(c)(viii) of the Transfer and Servicing Agreement)
ASSIGNMENT No. [___] OF RECEIVABLES IN AGGREGATE ADDITION
ACCOUNTS INCLUDED IN AMERICAN EXPRESS ISSUANCE TRUST (this "Assignment"), dated
as of [__________],(1) by and between AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION V LLC ("RFC V"), as transferor (the "Transferor"), and AMERICAN
EXPRESS ISSUANCE TRUST (the "Trust"), as issuer, pursuant to the Transfer and
Servicing Agreement referred to below.
W I T N E S S E T H:
WHEREAS, RFC V, as Transferor, American Express Travel Related
Services Company, Inc., as servicer (the "Servicer") and administrator, the
Trust and The Bank of New York, as Indenture Trustee (the "Indenture Trustee"),
are parties to the Amended and Restated Transfer and Servicing Agreement, dated
as of March [__], 2006 (hereinafter as such agreement may have been, or may from
time to time be, amended, supplemented or otherwise modified, the "Transfer and
Servicing Agreement");
WHEREAS, pursuant to the Transfer and Servicing Agreement, the
Transferor wishes to designate Aggregate Addition Accounts to be included as
Accounts and to convey its right, title and interest in the Receivables of such
Aggregate Addition Accounts, whether existing at the Addition Cut-Off Date or
thereafter created, to the Trust pursuant to the Transfer and Servicing
Agreement; and
WHEREAS, the Trust is willing to accept such designation and
pledge subject to the terms and conditions hereof.
NOW, THEREFORE, the Transferor and the Trust hereby agree as
follows:
1. Defined Terms. All capitalized terms used herein shall have
the meanings ascribed to them in the Transfer and Servicing Agreement unless
otherwise defined herein.
"Addition Cut Off Date" shall mean, with respect to the
Aggregate Addition Accounts, [_______, ___].
"Addition Date" shall mean, with respect to the Aggregate
Addition Accounts, [___________, ___].
"Additional Trust Assets" shall have the meaning set forth in
Subsection 3(a).
-----------
(1) To be dated as of the applicable Addition Date.
A-1
"Aggregate Addition Accounts" shall mean the Aggregate
Addition Accounts, as defined in the Transfer and Servicing Agreement, that are
designated hereby and listed on Schedule 1 hereto.
"Selection Date" shall mean [(i)] for the added accounts with
the code designation "[__]," the close of business on the cycle billing date for
such added accounts occurring in the period beginning on the close of business
on [_______] and ending at the close of business on [______] [and (ii) for the
added accounts with the code designation "[__]," the close of business on the
cycle billing date for such added accounts occurring in the period beginning on
the close of business on [_______] and ending at the close of business on
[_______]].
2. Designation of Aggregate Addition Accounts. The Transferor
shall deliver or cause to be delivered to the Trust and the Indenture Trustee
not later than five Business Days after the Addition Date, a computer file or
microfiche list containing a true and complete list of the Aggregate Addition
Accounts. Such list is incorporated into and made part of this Assignment, shall
be Schedule 1 to this Assignment and shall supplement Schedule 1 to the Transfer
and Servicing Agreement.
3. Conveyance of Receivables. (a) The Transferor does hereby
transfer, assign, set over and otherwise convey to the Trust, without recourse
except as provided in the Transfer and Servicing Agreement, all of its right,
title and interest, whether now owned or hereafter acquired, in, to and under
the Receivables existing at the Addition Cut Off Date and thereafter created and
arising in the Aggregate Addition Accounts (including Related Accounts with
respect to such Aggregate Addition Accounts), all Recoveries allocable to such
Receivables, all monies due or to become due and all amounts received or
receivable with respect thereto, all Collections with respect thereto, and all
proceeds (including "proceeds" as defined in the UCC) thereof (collectively, the
"Additional Trust Assets"). The foregoing does not constitute and is not
intended to result in the creation or assumption by the Trust, the Owner Trustee
(as such or in its individual capacity), the Indenture Trustee, any Noteholders
or any Supplemental Credit Enhancement Providers of any obligation of the
Servicer, the Transferor or any other Person in connection with the Additional
Trust Assets or under any agreement or instrument relating thereto, including
any obligation to Obligors, merchants clearance systems or insurers.
(b) If necessary, the Transferor shall record and file, at
its own expense, any financing statements (and amendments with respect
to such financing statements when applicable) with respect to the
Additional Trust Assets meeting the requirements of applicable state
law in such manner and in such jurisdictions as are necessary to
perfect, and maintain perfection of, the transfer, assignment, set-over
or other conveyance of its interest in such Additional Trust Assets to
the Trust and to deliver a file-stamped copy of each such financing
statement or other evidence of such filing to the Trust and the
Indenture Trustee as soon as practicable after the Addition Date.
Neither the Trust nor the Indenture Trustee shall be under any
obligation whatsoever to file such financing statements or amendments
to statements or to make any filing under the UCC in connection with
such transfer, assignment, set-over or other conveyance.
A-2
(c) The Transferor shall, at its own expense, on or prior
to the Addition Date, indicate in the appropriate computer files that
all Receivables created in connection with the Aggregate Addition
Accounts and the related Additional Trust Assets have been conveyed to
the Trust pursuant to the Transfer and Servicing Agreement and this
Assignment by including in the securitization field of such computer
files the code "[__]" [or "[__]," as applicable,] for each such
Aggregate Addition Account.
(d)______The Transferor does hereby grant to the Trust and the
Indenture Trustee a security interest in all of such Transferor's right, title
and interest, whether now owned or hereafter acquired, in, to and under the
Additional Trust Assets. This Assignment shall constitute a security agreement
under applicable law.
4. Acceptance by Trust. The Trust hereby acknowledges its
acceptance of all right, title and interest in and to the Additional Trust
Assets conveyed to the Trust pursuant to Section 3(a) of this Assignment.
5. Representations and Warranties of the Transferor. The
Transferor hereby acknowledges on the Addition Date that it makes the
representations and warranties in Sections 2.3 and 2.4 of the Transfer and
Servicing Agreement with respect to the Aggregate Addition Accounts.
6. Ratification of the Transfer and Servicing Agreement. The
Transfer and Servicing Agreement is hereby ratified, and all references to the
"Transfer and Servicing Agreement," to "this Transfer and Servicing Agreement"
and "herein" shall be deemed from and after the Addition Date to be a reference
to the Transfer and Servicing Agreement as supplemented and amended by this
Assignment. Except as expressly amended hereby, all the representations,
warranties, terms, covenants and conditions of the Transfer and Servicing
Agreement shall remain unamended and shall continue to be, and shall remain, in
full force and effect in accordance with its terms and, except as expressly
provided herein shall not constitute or be deemed to constitute a waiver of
compliance with or a consent to noncompliance with any term or provision of the
Transfer and Servicing Agreement.
7. Counterparts. This Assignment may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
instrument.
A-3
8. Governing Law; Submission to Jurisdiction; Appointment of
Agent for Service of Process. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware, without regard to
principles of conflict of laws. The parties hereto hereby declare that it is
their intention that this Agreement shall be regarded as made under the laws of
the State of Delaware and that the laws of said State shall be applied in
interpreting its provisions in all cases where legal interpretation shall be
required. Each of the parties hereto agrees (a) that this Agreement involves at
least $100,000.00, and (b) that this Agreement has been entered into by the
parties hereto in express reliance upon 6 Del. C. ss. 2708. Each of the parties
hereto hereby irrevocably and unconditionally agrees (a) to be subject to the
jurisdiction of the courts of the State of Delaware and of the federal courts
sitting in the State of Delaware, and (b) (1) to the extent such party is not
otherwise subject to service of process in the State of Delaware, to appoint and
maintain an agent in the State of Delaware as such party's agent for acceptance
of legal process, and (2) that, to the fullest extent permitted by applicable
law, service of process may also be made on such party by prepaid certified mail
with a proof of mailing receipt validated by the United States Postal Service
constituting evidence of valid service, and that service made pursuant to (b)
(1) or (2) above shall, to the fullest extent permitted by applicable law, have
the same legal force and effect as if served upon such party personally within
the State of Delaware.
A-4
IN WITNESS WHEREOF, the Transferor and the Trust have caused
this Assignment to be duly executed by their respective officers as of the day
and year first above written.
AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION V LLC,
as Transferor
By:
-------------------------------------------
Name:
Title:
AMERICAN EXPRESS ISSUANCE TRUST
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely
as Owner Trustee on behalf of the Trust
By:
-------------------------------------------
Name:
Title:
ACCEPTED AND ACKNOWLEDGED:
THE BANK OF NEW YORK,
as Indenture Trustee
By:
-------------------------------------------
Name:
Title:
Schedule 1 (to Exhibit A)
LIST OF AGGREGATE ADDITION ACCOUNTS
EXHIBIT B
FORM OF ASSIGNMENT OF AN ADDITIONAL COLLATERAL CERTIFICATE
INCLUDED IN AMERICAN EXPRESS ISSUANCE TRUST
(as required by section 2.13(c)(viii) of the Transfer and Servicing Agreement)
ASSIGNMENT No. [__] OF AN ADDITIONAL COLLATERAL CERTIFICATE
INCLUDED IN AMERICAN EXPRESS ISSUANCE TRUST (this "Assignment"), dated as of
[____________],(2) by and between AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION V LLC ("RFC V"), as transferor (the "Transferor"), and AMERICAN
EXPRESS ISSUANCE TRUST (the "Trust"), as issuer, pursuant to the Transfer and
Servicing Agreement referred to below.
W I T N E S S E T H:
WHEREAS, RFC V, as Transferor, American Express Travel Related
Services Company, Inc., as servicer (the "Servicer") and administrator, the
Trust and The Bank of New York, as Indenture Trustee (the "Indenture Trustee"),
are parties to the Amended and Restated Transfer and Servicing Agreement, dated
as of March [__], 2006 (hereinafter as such agreement may have been, or may from
time to time be, amended, supplemented or otherwise modified, the "Transfer and
Servicing Agreement");
WHEREAS, pursuant to the Transfer and Servicing Agreement, the
Transferor wishes to designate an additional Collateral Certificate to be
included as a Collateral Certificate and to convey its right, title and interest
in such additional Collateral Certificate to the Trust pursuant to the Transfer
and Servicing Agreement; and
WHEREAS, the Trust is willing to accept such designation and
pledge subject to the terms and conditions hereof.
NOW, THEREFORE, the Transferor and the Trust agree as follows:
1. Defined Terms. All capitalized terms used herein shall have
the meanings ascribed to them in the Transfer and Servicing Agreement unless
otherwise defined herein.
"Addition Date" shall mean, with respect to the Collateral
Certificate designated on Schedule 1 hereto, [_________, ______].
"Additional Trust Assets" shall have the meaning set forth in
Subsection 3(a).
2. Designation of Additional Collateral Certificate. The
Transferor shall deliver or cause to be delivered to the Trust and the Indenture
Trustee not later than five Business Days after the Addition Date, one or more
lists containing a true and complete list of the Collateral Certificates. Such
list is incorporated into and made part of this Assignment, shall be Schedule 1
to this Assignment and shall supplement Schedule 2 to the Transfer and Servicing
Agreement.
-----------
(2) To be dated as of the applicable Addition Date.
B-1
3. Conveyance of Additional Collateral Certificate. (a) The
Transferor does hereby transfer, assign, set over and otherwise convey to the
Trust, without recourse except as provided in the Transfer and Servicing
Agreement, all of its right, title and interest, whether now owned or hereafter
acquired, in, to and under the additional Collateral Certificate as of the
Addition Date, all monies due or to become due and all amounts received or
receivable with respect thereto, all Collections with respect thereto, and all
proceeds (including "proceeds" as defined in the UCC) thereof (collectively, the
"Additional Trust Assets"). The foregoing does not constitute and is not
intended to result in the creation or assumption by the Trust, the Owner Trustee
(as such or in its individual capacity), the Indenture Trustee, any Noteholders
or any Supplemental Credit Enhancement Providers of any obligation of the
Servicer, the Transferor or any other Person in connection with the Additional
Trust Assets or under any agreement or instrument relating thereto, including
any obligation to Obligors, merchants clearance systems or insurers.
(b) If necessary, the Transferor shall record and file,
at its own expense, financing statements (and amendments with respect to such
financing statements when applicable) with respect to the Additional Trust
Assets meeting the requirements of applicable state law in such manner and in
such jurisdictions as are necessary to perfect, and maintain perfection of, the
transfer, assignment, set-over or other conveyance of its interest in such
Additional Trust Assets to the Trust and to deliver a file-stamped copy of each
such financing statement or other evidence of such filing to the Trust and the
Indenture Trustee as soon as practicable after the Addition Date. Neither the
Trust nor the Indenture Trustee shall be under any obligation whatsoever to file
such financing statements or amendments to statements or to make any filing
under the UCC in connection with such transfer, assignment, set-over or other
conveyance.
(c) The Transferor does hereby grant to the Trust and the
Indenture Trustee a security interest in all of such Transferor's right, title
and interest, whether now owned or hereafter acquired, in, to and under the
Additional Trust Assets. This Assignment shall constitute a security agreement
under applicable law.
4. Acceptance by Trust. The Trust hereby acknowledges its
acceptance of all right, title and interest in and to the Additional Trust
Assets conveyed to the Trust pursuant to Section 3(a) of this Assignment.
5. Representations and Warranties of the Transferor. The
Transferor hereby acknowledges on the Addition Date that it makes the
representations and warranties in Sections 2.3 and 2.4 of the Transfer and
Servicing Agreement with respect to the additional Collateral Certificate.
6. Ratification of the Transfer and Servicing Agreement. The
Transfer and Servicing Agreement is hereby ratified, and all references to the
"Transfer and Servicing Agreement," to "this Transfer and Servicing Agreement"
and "herein" shall be deemed from and after the Addition Date to be a reference
to the Transfer and Servicing Agreement as supplemented and amended by this
Assignment. Except as expressly amended hereby, all the representations,
warranties, terms, covenants and conditions of the Transfer and Servicing
Agreement shall remain unamended and shall continue to be, and shall remain, in
full force and effect in accordance with its terms and, except as expressly
provided herein shall not constitute or be deemed to constitute a waiver of
compliance with or a consent to noncompliance with any term or provision of the
Transfer and Servicing Agreement.
B-2
7. Counterparts. This Assignment may be executed in any number
of counterparts, all of which taken together shall constitute one and the same
instrument.
8. Governing Law; Submission to Jurisdiction; Appointment of
Agent for Service of Process. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware, without regard to
principles of conflict of laws. The parties hereto hereby declare that it is
their intention that this Agreement shall be regarded as made under the laws of
the State of Delaware and that the laws of said State shall be applied in
interpreting its provisions in all cases where legal interpretation shall be
required. Each of the parties hereto agrees (a) that this Agreement involves at
least $100,000.00, and (b) that this Agreement has been entered into by the
parties hereto in express reliance upon 6 Del. C. ss. 2708. Each of the parties
hereto hereby irrevocably and unconditionally agrees (a) to be subject to the
jurisdiction of the courts of the State of Delaware and of the federal courts
sitting in the State of Delaware, and (b) (1) to the extent such party is not
otherwise subject to service of process in the State of Delaware, to appoint and
maintain an agent in the State of Delaware as such party's agent for acceptance
of legal process, and (2) that, to the fullest extent permitted by applicable
law, service of process may also be made on such party by prepaid certified mail
with a proof of mailing receipt validated by the United States Postal Service
constituting evidence of valid service, and that service made pursuant to (b)
(1) or (2) above shall, to the fullest extent permitted by applicable law, have
the same legal force and effect as if served upon such party personally within
the State of Delaware.
B-3
IN WITNESS WHEREOF, the Transferor and the Trust have caused
this Assignment to be duly executed by their respective officers as of the day
and year first above written.
AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION V LLC,
as Transferor
By:
---------------------------------------
Name:
Title:
AMERICAN EXPRESS ISSUANCE TRUST
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely
as Owner Trustee on behalf of the Trust
By:
---------------------------------------
Name:
Title:
ACCEPTED AND ACKNOWLEDGED:
THE BANK OF NEW YORK,
as Indenture Trustee
By:
---------------------------------------
Name:
Title:
Schedule 1 (to Exhibit B)
LIST OF COLLATERAL CERTIFICATES
EXHIBIT C
FORM OF ASSIGNMENT OF RECEIVABLES IN NEW ACCOUNTS
INCLUDED IN AMERICAN EXPRESS ISSUANCE TRUST
(as required by section 2.13(e)(vi) of the Transfer and Servicing Agreement)
ASSIGNMENT No. [___] OF RECEIVABLES IN NEW ACCOUNTS INCLUDED
IN AMERICAN EXPRESS ISSUANCE TRUST (this "Assignment"), dated as of the Addition
Date set forth below, by and between AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION V LLC ("RFC V"), as transferor (the "Transferor"), and AMERICAN
EXPRESS ISSUANCE TRUST (the "Trust"), as issuer, pursuant to the Transfer and
Servicing Agreement referred to below.
W I T N E S S E T H:
WHEREAS, RFC V, as Transferor, American Express Travel Related
Services Company, Inc., as servicer (the "Servicer") and administrator, the
Trust and The Bank of New York, as Indenture Trustee (the "Indenture Trustee"),
are parties to the Amended and Restated Transfer and Servicing Agreement, dated
as of March [__], 2006 (hereinafter as such agreement may have been, or may from
time to time be, amended, supplemented or otherwise modified, the "Transfer and
Servicing Agreement");
WHEREAS, pursuant to the Transfer and Servicing Agreement, the
Transferor wishes to designate New Accounts to be included as Accounts and to
convey its right, title and interest in the Receivables of such New Accounts (as
each such term is defined in the Transfer and Servicing Agreement), whether
existing at the Addition Cut-Off Date of each New Account or thereafter created,
to the Trust pursuant to the Transfer and Servicing Agreement; and
WHEREAS, the Trust is willing to accept such designation and
pledge subject to the terms and conditions hereof.
NOW, THEREFORE, the Transferor and the Trust hereby agree as
follows:
1. Defined Terms. All capitalized terms used herein shall have
the meanings ascribed to them in the Transfer and Servicing Agreement unless
otherwise defined herein.
"Addition Cut Off Date" shall mean, with respect to each New
Account, the date on which such New Account is originated.
"Addition Date" shall mean, with respect to each New Account,
[________].
"Additional Trust Assets" shall have the meaning set forth in
Subsection 3(a).
"New Account Delivery Date" shall mean the fifteenth calendar
day of the month (or, if such fifteenth calendar day is not a Business Day, the
next succeeding Business Day) following the Monthly Period in which the Addition
Date occurs.
C-1
"New Accounts" shall mean the New Accounts, as defined in the
Transfer and Servicing Agreement, that are designated hereby and to be listed on
Schedule 1 hereto.
"Selection Date" shall mean, with respect to each New Account,
the date on which such New Account is originated.
2. Designation of New Accounts. The New Accounts are
designated hereby. On the New Account Delivery Date, the Transferor shall
deliver or cause to be delivered to the Trust and the Indenture Trustee a
computer file or microfiche list containing a true and complete list of the New
Accounts. Such list is incorporated into and made part of this Assignment, shall
be Schedule 1 to this Assignment and shall supplement Schedule 1 to the Transfer
and Servicing Agreement.
3. Pledge of Receivables. (a) The Transferor does hereby
transfer, assign, set over and otherwise convey to the Trust, without recourse
except as provided in the Transfer and Servicing Agreement, all of its right,
title and interest, whether now owned or hereafter acquired, in, to and under
the Receivables existing at the close of business at the applicable Addition Cut
Off Date of each New Account and thereafter created and arising in the New
Accounts (including Related Accounts with respect to such Aggregate Addition
Accounts), all Recoveries allocable to such Receivables, all monies due or to
become due and all amounts received or receivable with respect thereto, all
Collections with respect thereto, and all proceeds (including "proceeds" as
defined in the UCC) thereof (collectively, the "Additional Trust Assets"). The
foregoing does not constitute and is not intended to result in the creation or
assumption by the Trust, the Owner Trustee (as such or in its individual
capacity), the Indenture Trustee, any Noteholders or any Supplemental Credit
Enhancement Providers of any obligation of the Servicer, the Transferor or any
other Person in connection with the Additional Trust Assets or under any
agreement or instrument relating thereto, including any obligation to Obligors,
merchants clearance systems or insurers.
(b) If necessary, the Transferor shall record and file, at
its own expense, financing statements (and amendments with respect to
such financing statements when applicable) with respect to the
Additional Trust Assets meeting the requirements of applicable state
law in such manner and in such jurisdictions as are necessary to
perfect, and maintain perfection of, the transfer, assignment, set-over
or other conveyance of its interest in such Additional Trust Assets to
the Trust, and to deliver a file-stamped copy of each such financing
statement or other evidence of such filing to the Trust and the
Indenture Trustee as soon as practicable after the Addition Date.
Neither the Trust nor the Indenture Trustee shall be under any
obligation whatsoever to file such financing statements or amendments
to statements or to make any filing under the UCC in connection with
such transfer, assignment, set-over or other conveyance.
(c) The Transferor shall, at its own expense, on or prior
to the Addition Date, indicate in the appropriate computer files that
all Receivables created in connection with the New Accounts and the
related Additional Trust Assets have been conveyed to the Trust
pursuant to this Assignment by including in the securitization field of
such computer files the code "[__]" [or "[__]," as applicable,] for
each such New Account.
C-2
(d) The Transferor does hereby grant to the Trust and the
Indenture Trustee a security interest in all of such Transferor's
right, title and interest, whether now owned or hereafter acquired, in,
to and under the Additional Trust Assets. This Assignment shall
constitute a security agreement under applicable law.
4. Acceptance by Trust. The Trust hereby acknowledges its
acceptance of all right, title and interest in and to the Additional Trust
Assets conveyed to the Trust pursuant to Section 3(a) of this Assignment.
5. Representations and Warranties of the Transferor. The
Transferor hereby acknowledges on the Addition Date that it makes the
representations and warranties in Sections 2.3 and 2.4 of the Transfer and
Servicing Agreement with respect to the New Accounts.
6. Ratification of the Transfer and Servicing Agreement. The
Transfer and Servicing Agreement is hereby ratified, and all references to the
"Transfer and Servicing Agreement," to "this Transfer and Servicing Agreement"
and "herein" shall be deemed from and after the Addition Date to be a reference
to the Transfer and Servicing Agreement as supplemented and amended by this
Assignment. Except as expressly amended hereby, all the representations,
warranties, terms, covenants and conditions of the Transfer and Servicing
Agreement shall remain unamended and shall continue to be, and shall remain, in
full force and effect in accordance with its terms and, except as expressly
provided herein shall not constitute or be deemed to constitute a waiver of
compliance with or a consent to noncompliance with any term or provision of the
Transfer and Servicing Agreement.
7. Counterparts. This Assignment may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument.
C-3
8. Governing Law; Submission to Jurisdiction; Appointment of
Agent for Service of Process. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware, without regard to
principles of conflict of laws. The parties hereto hereby declare that it is
their intention that this Agreement shall be regarded as made under the laws of
the State of Delaware and that the laws of said State shall be applied in
interpreting its provisions in all cases where legal interpretation shall be
required. Each of the parties hereto agrees (a) that this Agreement involves at
least $100,000.00, and (b) that this Agreement has been entered into by the
parties hereto in express reliance upon 6 Del. C. ss. 2708. Each of the parties
hereto hereby irrevocably and unconditionally agrees (a) to be subject to the
jurisdiction of the courts of the State of Delaware and of the federal courts
sitting in the State of Delaware, and (b) (1) to the extent such party is not
otherwise subject to service of process in the State of Delaware, to appoint and
maintain an agent in the State of Delaware as such party's agent for acceptance
of legal process, and (2) that, to the fullest extent permitted by applicable
law, service of process may also be made on such party by prepaid certified mail
with a proof of mailing receipt validated by the United States Postal Service
constituting evidence of valid service, and that service made pursuant to (b)
(1) or (2) above shall, to the fullest extent permitted by applicable law, have
the same legal force and effect as if served upon such party personally within
the State of Delaware.
C-4
IN WITNESS WHEREOF, the Transferor and the Trust have caused
this Assignment to be duly executed by their respective officers as of the day
and year first above written.
AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION V LLC,
as Transferor
By:
---------------------------------------
Name:
Title:
AMERICAN EXPRESS ISSUANCE TRUST
By: WILMINGTON TRUST COMPANY,
not in its individual capacity but solely
as Owner Trustee on behalf of the Trust
By:
---------------------------------------
Name:
Title:
ACCEPTED AND ACKNOWLEDGED:
THE BANK OF NEW YORK,
as Indenture Trustee
By:
---------------------------------------
Name:
Title:
Schedule 1 (to Exhibit C)
LIST OF NEW ACCOUNTS
EXHIBIT D
FORM OF REASSIGNMENT OF RECEIVABLES IN REMOVED ACCOUNTS
FROM AMERICAN EXPRESS ISSUANCE TRUST
(as required by section 2.14(b) of the Transfer and Servicing Agreement)
REASSIGNMENT No. [___] OF RECEIVABLES INCLUDED IN AMERICAN
EXPRESS ISSUANCE TRUST (this "Reassignment"), dated as of [___________],(3) by
and between AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION V LLC ("RFC V"),
as transferor (the "Transferor"), and AMERICAN EXPRESS ISSUANCE TRUST (the
"Trust"), as issuer, pursuant to the Transfer and Servicing Agreement referred
to below.
W I T N E S S E T H:
WHEREAS, RFC V, as Transferor, American Express Travel Related
Services Company, Inc., as Servicer (the "Servicer") and administrator, the
Trust and The Bank of New York, as Indenture Trustee (the "Indenture Trustee"),
are parties to the Amended and Restated Transfer and Servicing Agreement, dated
as of March [__], 2006 (hereinafter as such agreement may have been, or may from
time to time be, amended, supplemented or otherwise modified, the "Transfer and
Servicing Agreement");
WHEREAS, pursuant to the Transfer and Servicing Agreement, the
Trust wishes to remove from the Trust all Receivables in certain designated
Accounts (the "Removed Accounts") and to cause the Trust to reassign the
Receivables of such Removed Accounts, whether now existing or hereafter created,
from the Trust to the Transferor; and
WHEREAS, the Trust is willing to accept such designation and
to reconvey the Receivables in the Removed Accounts subject to the terms and
conditions hereof.
NOW, THEREFORE, the Trust and the Transferor hereby agree as
follows:
1. Defined Terms. All terms defined in the Transfer and
Servicing Agreement and used herein shall have such defined meanings when used
herein, unless otherwise defined herein.
"Removal Date" shall mean, with respect to the Removed
Accounts, [________, ____].
"Removal Notice Date" shall mean, with respect to the Removed
Accounts, [_____, ____].
"Removed Accounts" shall mean the Removed Accounts, as defined
in the Transfer and Servicing Agreement, that are designated hereby and listed
on Schedule 1 hereto.
2. Designation of Removed Accounts. On or prior to the
Removal Date, the Transferor shall deliver or cause to be delivered to the Trust
and the Indenture Trustee a computer file or microfiche list containing a true
and complete list of the Removed Accounts. Such list is incorporated into and
made part of this Assignment, shall be Schedule 1 to this Reassignment and shall
supplement Schedule 1 to the Transfer and Servicing Agreement.
-----------
(3) To be dated as of the Removal Date.
D-1
3. Conveyance of Receivables. (a) The Trust does hereby sell,
transfer, assign, set over and otherwise convey to the Transferor, effective as
of the Removal Date, without recourse, representation or warranty, all the
right, title and interest of the Trust in, to and under the Receivables arising
in the Removed Accounts, all Recoveries allocable to such Receivables, all
monies due or to become due and all amounts received or receivable with respect
thereto, all Collections with respect thereto, and all proceeds (including
"proceeds" as defined in the UCC) thereof (collectively, the "Removed Trust
Assets").
(b) In connection with such reassignment, the Trust agrees
to execute and deliver to the Transferor, on or prior to the date this
Reassignment is delivered, applicable termination statements prepared
by the Trust with respect to the Removed Trust Assets evidencing the
release by the Trust of its security interest in the Receivables in the
Removed Accounts, and meeting the requirements of applicable state law,
in such manner and such jurisdictions as necessary to terminate such
interest.
(c) The Transferor shall, at its own expense, on or prior
to the Removal Date, indicate in the appropriate computer files that
all Receivables reassigned in connection with the Removed Accounts and
the related Removed Trust Assets have been conveyed to the Transferor
pursuant to this Reassignment by deleting in the securitization field
of such computer files the code "[__]"[or "[__]," as applicable,] for
each such Removed Account.
4. Representations and Warranties. The Transferor hereby
represents and warrants to the Indenture Trustee as of the Removal Date:
(a) Legal Valid and Binding Obligation. This Reassignment
constitutes a legal, valid and binding obligation of the Transferor
enforceable against the Transferor, in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect affecting the enforcement of creditors' rights in
general and except as such enforceability may be limited by general
principles of equity (whether considered in a suit at law or in
equity); and
(b) List of Removed Accounts. The list of Removed Accounts
delivered pursuant to subsection 2.14(a)(ii) of the Transfer and
Servicing Agreement, as of the Removal Date, is true and complete in
all material respects.
5. Ratification of the Transfer and Servicing Agreement. The
Transfer and Servicing Agreement is hereby ratified, and all references to the
"Transfer and Servicing Agreement," to "this Transfer and Servicing Agreement"
and "herein" shall be deemed from and after the removal Date to be a reference
to the Transfer and Servicing Agreement as supplemented and amended by this
Reassignment. Except as expressly amended hereby, all the representations,
warranties, terms, covenants and conditions of the Transfer and Servicing
Agreement shall remain unamended and shall continue to be, and shall remain, in
full force and effect in accordance with its terms and, except as expressly
provided herein shall not constitute or be deemed to constitute a waiver of
compliance with or a consent to noncompliance with any term or provision of the
Transfer and Servicing Agreement.
D-2
6. Counterparts. This Reassignment may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument.
7. Governing Law; Submission to Jurisdiction; Appointment of
Agent for Service of Process. This Agreement shall be governed by and construed
in accordance with the laws of the State of Delaware, without regard to
principles of conflict of laws. The parties hereto hereby declare that it is
their intention that this Agreement shall be regarded as made under the laws of
the State of Delaware and that the laws of said State shall be applied in
interpreting its provisions in all cases where legal interpretation shall be
required. Each of the parties hereto agrees (a) that this Agreement involves at
least $100,000.00, and (b) that this Agreement has been entered into by the
parties hereto in express reliance upon 6 Del. C. ss. 2708. Each of the parties
hereto hereby irrevocably and unconditionally agrees (a) to be subject to the
jurisdiction of the courts of the State of Delaware and of the federal courts
sitting in the State of Delaware, and (b) (1) to the extent such party is not
otherwise subject to service of process in the State of Delaware, to appoint and
maintain an agent in the State of Delaware as such party's agent for acceptance
of legal process, and (2) that, to the fullest extent permitted by applicable
law, service of process may also be made on such party by prepaid certified mail
with a proof of mailing receipt validated by the United States Postal Service
constituting evidence of valid service, and that service made pursuant to (b)
(1) or (2) above shall, to the fullest extent permitted by applicable law, have
the same legal force and effect as if served upon such party personally within
the State of Delaware.
D-3
IN WITNESS WHEREOF, the Trust and the Transferor have caused
this Reassignment to be duly executed by their respective officers as of the day
and year first above written.
AMERICAN EXPRESS ISSUANCE TRUST
By: WILMINGTON TRUST COMPANY, not in its
individual capacity but solely as Owner
Trustee on behalf of the Trust
By:
--------------------------------------
Name:
Title:
AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION V LLC,
as Transferor
By:
--------------------------------------
Name:
Title:
ACCEPTED AND ACKNOWLEDGED:
THE BANK OF NEW YORK,
as Indenture Trustee
By:
--------------------------------------
Name:
Title:
D-4
Schedule 1 (to Exhibit D)
REMOVED ACCOUNTS
D-5
EXHIBIT E
[RESERVED]
E-1
EXHIBIT F-1
FORM OF OPINION OF COUNSEL
WITH RESPECT TO AMENDMENTS
Provisions to be included in
Opinion of Counsel to be delivered pursuant
to Section 12.2(d)(i)
The opinions set forth below may be subject to all the
qualifications, assumptions, limitations and exceptions taken or made in the
Opinions Of Counsel delivered on any applicable amendment date.
(i) The amendment to the Transfer and Servicing Agreement,
attached hereto as Schedule 1 (the "Amendment"), has
been duly authorized, executed and delivered by the
Transferor and constitutes the legal, valid and binding
agreement of the Transferor, enforceable in accordance
with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws from time to
time in effect affecting creditors' rights generally.
The enforceability of the Transferor's obligations is
also subject to general principles of equity
(regardless of whether such enforceability is
considered in a proceeding in equity or at law).
(ii) The Amendment has been entered into in accordance with
the terms and provisions of Section 12.1 of the
Transfer and Servicing Agreement.
F-1-1
EXHIBIT F-2
FORM OF OPINION OF COUNSEL
WITH RESPECT TO AGGREGATE ADDITION ACCOUNTS
Provisions to be included in
Opinion of Counsel to be
delivered pursuant to
subsection 12.2(d)(ii) or (iv)
The opinions set forth below may be subject to all the
qualifications, assumptions, limitations and exceptions taken or made in the
Opinions of Counsel delivered on any applicable Issuance Date.
1. The Transfer and Servicing Agreement creates in favor
of the Trust a security interest in the rights of the
Transferor in the Receivables identified in Schedule 1
to the Transfer and Servicing Agreement and the
identifiable proceeds thereof.
2. The security interest described in the paragraph above
is perfected.
3. The UCC search report obtained from the Secretary of
State of the State of Delaware (Uniform Commercial Code
Section) (the "Division") against the Transferor sets
forth the proper filing office and the proper debtor
necessary to identify those persons who under the
Delaware Uniform Commercial Code have on file financing
statements against the Transferor covering the
Receivables as of the effective time of the UCC search
report. The UCC search report identifies no secured
party (other than The Bank of New York) who has on file
with the Division a currently effective financing
statement naming the Transferor as debtor.
F-2-1
EXHIBIT F-3
FORM OF OPINION OF COUNSEL
WITH RESPECT TO NEW ACCOUNTS
Provisions to be included in
Opinion of Counsel to be
delivered pursuant to
subsection 12.2(d)(iii)
The opinions set forth below may be subject to all the
qualifications, assumptions, limitations and exceptions taken or made in the
Opinions of Counsel delivered on any applicable Issuance Date.
1. The Transfer and Servicing Agreement creates in favor
of the Trust a security interest in the rights of the
Transferor in the Receivables identified in Schedule 1
to the Transfer and Servicing Agreement and the
identifiable proceeds thereof.
2. The security interest described in the paragraph above
is perfected.
3. The UCC search report obtained from the Secretary of
State of the State of Delaware (Uniform Commercial Code
Section) (the "Division") against the Transferor sets
forth the proper filing office and the proper debtor
necessary to identify those persons who under the
Delaware Uniform Commercial Code have on file financing
statements against the Transferor covering the
Receivables as of the effective time of the UCC search
report. The UCC search report identifies no secured
party (other than The Bank of New York) who has on file
with the Division a currently effective financing
statement naming the Transferor as debtor.
F-3-1
EXHIBIT F-4
PROVISIONS TO BE INCLUDED IN
ANNUAL OPINION OF COUNSEL
The opinions set forth below may be subject to all the
qualifications, assumptions, limitations and exceptions taken or made in the
Opinions of Counsel delivered on any applicable Issuance Date. Unless otherwise
indicated, all capitalized terms used herein shall have the meanings ascribed to
them in the Transfer and Servicing Agreement and in the Assignment.
4. The security interest created by the Transfer and Servicing
Agreement in favor of the Trust in the rights of the Transferor in the
Receivables identified in Schedule 1 to the Transfer and Servicing Agreement and
the identifiable proceeds thereof is perfected.
5. A UCC search report has been obtained from the Secretary of
State of the State of Delaware (Uniform Commercial Code Division) (the
"Division") that confirms that the financing statement(s) filed to perfect the
security interest of the Trust in the Receivables is(are) still effective and of
record with the Division.
F-4-1
EXHIBIT G
FORM OF ANNUAL CERTIFICATION
Re: The Amended and Restated Transfer and Servicing Agreement,
dated as of March [__], 2006 (the "Agreement"), among American
Express Receivables Financing Corporation V LLC, as
transferor, American Express Travel Related Services Company,
Inc., as servicer and administrator, American Express Issuance
Trust, as issuer, and The Bank of New York, as indenture
trustee
I, ________________________________, the _______________________ of THE
BANK OF NEW YORK (the "Company"), certify to the Transferor, and their
respective officers, with the knowledge and intent that they will rely upon this
certification, that:
(1) I have reviewed the report on assessment of the Company's
compliance provided in accordance with Rules 13a-18 and 15d-18 under
the Securities Exchange Act of 1934, as amended (the "Exchange Act")
and Item 1122 of Regulation AB (the "Servicing Assessment"), and the
registered public accounting firm's attestation report provided in
accordance with Rules 13a-18 and 15d-18 under the Exchange Act and
Section 1122(b) of Regulation AB (the "Attestation Report"), that were
delivered by the Company to the Transferor pursuant to the Agreement
(collectively, the "Company Information");
(2) To the best of my knowledge, the Company Information,
taken as a whole, does not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements
made, in the light of the circumstances under which such statements
were made, not misleading with respect to the period of time covered by
the Company Information;
(3) To the best of my knowledge, all of the Company
Information required to be provided by the Company under the Agreement
has been provided to the Transferor; and
(4) To the best of my knowledge, except as disclosed in the
Servicing Assessment or the Attestation Report, the Company has
fulfilled its obligations in all material respects under the Agreement.
Date:
-----------------------------------
By:
-----------------------------------
Name:
Title:
G-1
EXHIBIT H
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by the Indenture Trustee
shall address, at a minimum, the criteria identified as below as "Applicable
Servicing Criteria":
------------------------------------------------------------------------------------------ ----------------------
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
------------------------------------------------------------------------------------------ ----------------------
REFERENCE CRITERIA
-------------------- --------------------------------------------------------------------- ----------------------
GENERAL SERVICING CONSIDERATIONS
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(1)(i) Policies and procedures are instituted to monitor any
performance or other triggers and events of default in
accordance with the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(1)(ii) If any material servicing activities are outsourced to
third parties, policies and procedures are instituted to
monitor the third party's performance and compliance with
such servicing activities.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(1)(iii) Any requirements in the transaction agreements to maintain
a back-up servicer for the credit card accounts or accounts
are maintained.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(1)(iv) A fidelity bond and errors and omissions policy is in
effect on the party participating in the servicing function
throughout the reporting period in the amount of coverage
required by and otherwise in accordance with the terms of
the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
CASH COLLECTION AND ADMINISTRATION
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(2)(i) Payments on credit card accounts are deposited into the |X|(1)
appropriate |X|(4) custodial bank accounts and related bank
clearing accounts no more than two business days following
receipt, or such other number of days specified in the
transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of an obligor or to |X|
an investor are made only by authorized personnel.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(2)(iii) Advances of funds or guarantees regarding collections, cash
flows or distributions, and any interest or other fees
charged for such advances, are made, reviewed and approved
as specified in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(2)(iv) The related accounts for the transaction, such as cash
reserve accounts or accounts established as a form of
overcollateralization, are separately maintained (e.g.,
with respect to commingling of cash) as set forth in the
transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(2)(v) Each custodial account is maintained at a federally insured
depository institution as set forth in the transaction
agreements. For purposes of this criterion, "federally
insured depository institution" with respect to a foreign
financial institution means a foreign financial institution
that meets the requirements of Rule 13k-1(b)(1) of the
Securities Exchange Act.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent
unauthorized access.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis for all
asset-backed securities related bank accounts, including
custodial accounts and related bank clearing accounts.
These reconciliations are (A) mathematically accurate; (B)
prepared within 30 calendar days after the bank statement
cutoff date, or such other number of days specified in the
transaction agreements; (C) reviewed and approved by
someone other than the person who prepared the
reconciliation; and (D) contain explanations for
reconciling items. These reconciling items are resolved
within 90 calendar days of their original identification,
or such other number of days specified in the transaction
agreements.
-------------------- --------------------------------------------------------------------- ----------------------
-----------
(1) Solely with regard to deposits made by the Indenture Trustee.
H-1
------------------------------------------------------------------------------------------ ----------------------
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
------------------------------------------------------------------------------------------ ----------------------
REFERENCE CRITERIA
-------------------- --------------------------------------------------------------------- ----------------------
INVESTOR REMITTANCES AND REPORTING
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(3)(i) Reports to investors, including those to be filed with the
Commission, are maintained in accordance with the
transaction agreements and applicable Commission
requirements. Specifically, such reports (A) are prepared
in accordance with timeframes and other terms set forth in
the transaction agreements; (B) provide information
calculated in accordance with the terms specified in the
transaction agreements; (C) are filed with the Commission
as required by its rules and regulations; and (D) agree
with investors' or the trustee's records as to the total
unpaid principal balance and number of credit card accounts
serviced by the Servicer.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(3)(ii) Amounts due to investors are allocated and remitted in accordance |X|
with timeframes, distribution priority and other terms set forth in
the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(3)(iii) Disbursements made to an investor are posted within two business
days to the Servicer's investor records, or such other number of |X|
days specified in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(3)(iv) Amounts remitted to investors per the investor reports
agree with cancelled checks, or other form of payment, or
custodial bank statements. |X|
-------------------- --------------------------------------------------------------------- ----------------------
POOL ASSET ADMINISTRATION
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(i) Collateral or security on credit card accounts is maintained as |X|
required by the transaction agreements or related asset pool
documents.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(ii) Account and related documents are safeguarded as required by the |X|
transaction agreements
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(iii) Any additions, removals or substitutions to the asset pool
are made, reviewed and approved in accordance with any
conditions or requirements in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(iv) Payments on credit card accounts, including any payoffs,
made in accordance with the related credit card accounts
documents are posted to the Servicer's obligor records
maintained no more than two business days after receipt, or
such other number of days specified in the transaction
agreements, and allocated to principal, interest or other
items (e.g., escrow) in accordance with the related asset
pool documents.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(v) The Servicer's records regarding the accounts and the
accounts agree with the Servicer's records with respect to
an obligor's unpaid principal balance.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(vi) Changes with respect to the terms or status of an obligor's
account (e.g., loan modifications or re-agings) are made,
reviewed and approved by authorized personnel in accordance
with the transaction agreements and related pool asset
documents.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., forbearance
plans, modifications and deeds in lieu of foreclosure,
foreclosures and repossessions, as applicable) are
initiated, conducted and concluded in accordance with the
timeframes or other requirements established by the
transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(viii) Records documenting collection efforts are maintained
during the period a Account is delinquent in accordance
with the transaction agreements. Such records are
maintained on at least a monthly basis, or such other
period specified in the transaction agreements, and
describe the entity's activities in monitoring delinquent
Accounts including, for example, phone calls, letters and
payment rescheduling plans in cases where delinquency is
deemed temporary (e.g., illness or unemployment).
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(ix) Adjustments to interest rates or rates of return for
Accounts with variable rates are computed based on the
related Account documents.
-------------------- --------------------------------------------------------------------- ----------------------
H-2
------------------------------------------------------------------------------------------ ----------------------
APPLICABLE SERVICING
SERVICING CRITERIA CRITERIA
------------------------------------------------------------------------------------------ ----------------------
REFERENCE CRITERIA
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(x) Regarding any funds held in trust for an obligor (such as
escrow accounts): (A) such funds are analyzed, in
accordance with the obligor's Account documents, on at
least an annual basis, or such other period specified in
the transaction agreements; (B) interest on such funds is
paid, or credited, to obligors in accordance with
applicable Account documents and state laws; and (C) such
funds are returned to the obligor within 30 calendar days
of full repayment of the related Accounts, or such other
number of days specified in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(xi) Payments made on behalf of an obligor (such as tax or
insurance payments) are made on or before the related
penalty or expiration dates, as indicated on the
appropriate bills or notices for such payments, provided
that such support has been received by the servicer at
least 30 calendar days prior to these dates, or such other
number of days specified in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(xii) Any late payment penalties in connection with any payment
to be made on behalf of an obligor are paid from the
servicer's funds and not charged to the obligor, unless the
late payment was due to the obligor's error or omission.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are posted
within two business days to the obligor's records
maintained by the servicer, or such other number of days
specified in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible accounts are
recognized and recorded in accordance with the transaction
agreements.
-------------------- --------------------------------------------------------------------- ----------------------
1122(d)(4)(xv) Any external enhancement or other support, identified in
Item 1114(a)(1) through (3) or Item 1115 of Regulation AB,
is maintained as set forth in the transaction agreements.
-------------------- --------------------------------------------------------------------- ----------------------
-------------------- --------------------------------------------------------------------- ----------------------
[NAME OF INDENTURE TRUSTEE]
Date:
-----------------------------------
By:
-----------------------------------
Name:
Title:
H-3
EXHIBIT I
FORM OF ANNUAL CERTIFICATION
Re: The [ ] agreement dated as of [ ], 200[ ]
(the "Agreement"), among [IDENTIFY PARTIES]
I, ________________________________, the _______________________ of
[NAME OF COMPANY] (the "Company"), certify to the Transferor, and its officers,
with the knowledge and intent that they will rely upon this certification, that:
(1) I have reviewed the report on assessment of the Company's
compliance provided in accordance with Rules 13a-18 and 15d-18 under
the Securities Exchange Act of 1934, as amended (the "Exchange Act")
and Item 1122 of Regulation AB (the "Servicing Assessment"), and the
registered public accounting firm's attestation report provided in
accordance with Rules 13a-18 and 15d-18 under the Exchange Act and
Section 1122(b) of Regulation AB (the "Attestation Report"), that were
delivered by the Company to the Transferor pursuant to the Agreement
(collectively, the "Company Information");
(2) To the best of my knowledge, the Company Information,
taken as a whole, does not contain any untrue statement of a material
fact or omit to state a material fact necessary to make the statements
made, in the light of the circumstances under which such statements
were made, not misleading with respect to the period of time covered by
the Company Information;
(3) To the best of my knowledge, all of the Company
Information required to be provided by the Company under the Agreement
has been provided to the Transferor; and
(4) To the best of my knowledge, except as disclosed in the
Servicing Assessment or the Attestation Report, the Company has
fulfilled its obligations in all material respects under the Agreement.
Date:
-----------------------------------
By:
-----------------------------------
Name:
Title:
I-1
EXHIBIT J
SERVICING CRITERIA TO BE ADDRESSED IN ASSESSMENT OF COMPLIANCE
The assessment of compliance to be delivered by the [Servicer]
[Subservicer] shall address, at a minimum, the criteria identified as below as
"Applicable Servicing Criteria":
--------------------------------------------------------------------------------------- -------------- -----------------
SERVICING CRITERIA APPLICABLE APPLICABLE
SERVICING SERVICING
CRITERIA FOR CRITERIA FOR A
SERVICER SUBSERVICER
-------------------- ------------------------------------------------------------------ -------------- -----------------
REFERENCE CRITERIA
-------------------- ------------------------------------------------------------------ -------------- -----------------
GENERAL SERVICING CONSIDERATIONS
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(1)(i) Policies and procedures are instituted to monitor any
performance or other triggers and events of default in
accordance with the transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(1)(ii) If any material servicing activities are outsourced to
third parties, policies and procedures are instituted to
monitor the third party's performance and compliance with
such servicing activities.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(1)(iii) Any requirements in the transaction agreements to maintain
a back-up servicer for the credit card accounts or accounts
are maintained.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(1)(iv) A fidelity bond and errors and omissions policy is in
effect on the party participating in the servicing function
throughout the reporting period in the amount of coverage
required by and otherwise in accordance with the terms of
the transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
CASH COLLECTION AND ADMINISTRATION
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(2)(i) Payments on credit card accounts are deposited into the
appropriate custodial bank accounts and related bank
clearing accounts no more than two business days following
receipt, or such other number of days specified in the
transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(2)(ii) Disbursements made via wire transfer on behalf of an
obligor or to an investor are made only by authorized
personnel.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(2)(iii) Advances of funds or guarantees regarding collections, cash
flows or distributions, and any interest or other fees
charged for such advances, are made, reviewed and approved
as specified in the transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(2)(iv) The related accounts for the transaction, such as cash
reserve accounts or accounts established as a form of
overcollateralization, are separately maintained (e.g.,
with respect to commingling of cash) as set forth in the
transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(2)(v) Each custodial account is maintained at a federally insured
depository institution as set forth in the transaction
agreements. For purposes of this criterion, "federally
insured depository institution" with respect to a foreign
financial institution means a foreign financial institution
that meets the requirements of Rule 13k-1(b)(1) of the
Securities Exchange Act.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(2)(vi) Unissued checks are safeguarded so as to prevent
unauthorized access.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(2)(vii) Reconciliations are prepared on a monthly basis for all
asset-backed securities related bank accounts, including
custodial accounts and related bank clearing accounts.
These reconciliations are (A) mathematically accurate; (B)
prepared within 30 calendar days after the bank statement
cutoff date, or such other number of days specified in the
transaction agreements; (C) reviewed and approved by
someone other than the person who prepared the
reconciliation; and (D) contain explanations for
reconciling items. These reconciling items are resolved
within 90 calendar days of their original identification,
or such other number of days specified in the transaction
agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
J-1
--------------------------------------------------------------------------------------- -------------- -----------------
SERVICING CRITERIA APPLICABLE APPLICABLE
SERVICING SERVICING
CRITERIA FOR CRITERIA FOR A
SERVICER SUBSERVICER
-------------------- ------------------------------------------------------------------ -------------- -----------------
REFERENCE CRITERIA
-------------------- ------------------------------------------------------------------ -------------- -----------------
INVESTOR REMITTANCES AND REPORTING
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(3)(i) Reports to investors, including those to be filed with the
Commission, are maintained in accordance with the
transaction agreements and applicable Commission
requirements. Specifically, such reports (A) are prepared
in accordance with timeframes and other terms set forth in
the transaction agreements; (B) provide information
calculated in accordance with the terms specified in the
transaction agreements; (C) are filed with the Commission
as required by its rules and regulations; and (D) agree
with investors' or the trustee's records as to the total
unpaid principal balance and number of credit card accounts
serviced by the Servicer.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(3)(ii) Amounts due to investors are allocated and remitted in
accordance with timeframes, distribution priority and other
terms set forth in the transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(3)(iii) Disbursements made to an investor are posted within two
business days to the Servicer's investor records, or such
other number of days specified in the transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(3)(iv) Amounts remitted to investors per the investor reports
agree with cancelled checks, or other form of payment, or
custodial bank statements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
POOL ASSET ADMINISTRATION
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(i) Collateral or security on credit card accounts is
maintained as required by the transaction agreements or
related asset pool documents.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(ii) Account and related documents are safeguarded as required by the
transaction agreements
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(iii) Any additions, removals or substitutions to the asset pool
are made, reviewed and approved in accordance with any
conditions or requirements in the transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(iv) Payments on credit card accounts, including any payoffs,
made in accordance with the related credit card accounts
documents are posted to the Servicer's obligor records
maintained no more than two business days after receipt, or
such other number of days specified in the transaction
agreements, and allocated to principal, interest or other
items (e.g., escrow) in accordance with the related asset
pool documents.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(v) The Servicer's records regarding the accounts and the
accounts agree with the Servicer's records with respect to
an obligor's unpaid principal balance.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(vi) Changes with respect to the terms or status of an obligor's
account (e.g., loan modifications or re-agings) are made,
reviewed and approved by authorized personnel in accordance
with the transaction agreements and related pool asset
documents.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(vii) Loss mitigation or recovery actions (e.g., forbearance
plans, modifications and deeds in lieu of foreclosure,
foreclosures and repossessions, as applicable) are
initiated, conducted and concluded in accordance with the
timeframes or other requirements established by the
transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(viii) Records documenting collection efforts are maintained
during the period a Account is delinquent in accordance
with the transaction agreements. Such records are
maintained on at least a monthly basis, or such other
period specified in the transaction agreements, and
describe the entity's activities in monitoring delinquent
Accounts including, for example, phone calls, letters and
payment rescheduling plans in cases where delinquency is
deemed temporary (e.g., illness or unemployment).
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(ix) Adjustments to interest rates or rates of return for
Accounts with variable rates are computed based on the
related Account documents.
-------------------- ------------------------------------------------------------------ -------------- -----------------
J-2
--------------------------------------------------------------------------------------- -------------- -----------------
SERVICING CRITERIA APPLICABLE APPLICABLE
SERVICING SERVICING
CRITERIA FOR CRITERIA FOR A
SERVICER SUBSERVICER
-------------------- ------------------------------------------------------------------ -------------- -----------------
REFERENCE CRITERIA
-------------------- ------------------------------------------------------------------ -------------- -----------------
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(x) Regarding any funds held in trust for an obligor (such as
escrow accounts): (A) such funds are analyzed, in
accordance with the obligor's Account documents, on at
least an annual basis, or such other period specified in
the transaction agreements; (B) interest on such funds is
paid, or credited, to obligors in accordance with
applicable Account documents and state laws; and (C) such
funds are returned to the obligor within 30 calendar days
of full repayment of the related Accounts, or such other
number of days specified in the transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(xi) Payments made on behalf of an obligor (such as tax or
insurance payments) are made on or before the related
penalty or expiration dates, as indicated on the
appropriate bills or notices for such payments, provided
that such support has been received by the servicer at
least 30 calendar days prior to these dates, or such other
number of days specified in the transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(xii) Any late payment penalties in connection with any payment
to be made on behalf of an obligor are paid from the
servicer's funds and not charged to the obligor, unless the
late payment was due to the obligor's error or omission.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(xiii) Disbursements made on behalf of an obligor are posted
within two business days to the obligor's records
maintained by the servicer, or such other number of days
specified in thev transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(xiv) Delinquencies, charge-offs and uncollectible accounts are
recognized and recorded in accordance with the transaction
agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
1122(d)(4)(xv) Any external enhancement or other support, identified in
Item 1114(a)(1) through (3) or Item 1115 of Regulation AB,
is maintained as set forth in the transaction agreements.
-------------------- ------------------------------------------------------------------ -------------- -----------------
-------------------- ------------------------------------------------------------------ -------------- -----------------
[NAME OF [SERVICER] [SUBSERVICER]
Date:
-----------------------------------
By:
-----------------------------------
Name:
Title:
J-3
SCHEDULE 1
List of Accounts
[Delivered to Indenture Trustee]
SCHEDULE 2
List of Collateral Certificates
[Delivered to Indenture Trustee]
