DISCOVER BANK Master Servicer, Servicer and Seller and U.S. BANK NATIONAL ASSOCIATION Trustee on behalf of the Certificateholders SERIES SUPPLEMENT Dated as of [________], 2007 to AMENDED AND RESTATED POOLING AND SERVICING AGREEMENT Dated as of...
Exhibit 4.4
DISCOVER BANK
Master Servicer, Servicer and Seller
and
U.S. BANK NATIONAL ASSOCIATION
Trustee
on behalf of the Certificateholders
SERIES SUPPLEMENT
Dated as of [________], 2007
to
AMENDED AND RESTATED POOLING AND SERVICING AGREEMENT
Dated as of November 3, 2004, as amended
SERIES 2007-CC
TABLE OF CONTENTS
Page | ||||||
SECTION 1. |
Definitions | 1 | ||||
SECTION 2. |
Subordination | 8 | ||||
SECTION 3. |
Representations and Warranties of the Sellers | 8 | ||||
SECTION 4. |
Representations,
Warranties and Covenants of Discover Bank as Master Servicer and Servicer |
10 | ||||
SECTION 5. |
Representations and Warranties of Other Servicers | 10 | ||||
SECTION 6. |
Representations, Warranties and Covenants of the Trustee | 11 | ||||
SECTION 7. |
Authentication of Certificates | 11 | ||||
SECTION 8. |
Establishment and Administration of Investor Accounts | 11 | ||||
SECTION 9. |
Allocations of Collections | 12 | ||||
SECTION 10. |
Servicing Compensation | 18 | ||||
SECTION 11. |
Investor Certificateholders’ Monthly Statement | 19 | ||||
SECTION 12. |
Purchase of Notes; Sales of Receivables | 19 | ||||
SECTION 13. |
Ratification of Pooling and Servicing Agreement | 20 | ||||
SECTION 14. |
Counterparts | 20 | ||||
SECTION 15. |
Governing Law | 20 | ||||
SECTION 16. |
Intention of Parties | 20 | ||||
SECTION 17. |
Amendment for Sale Accounting Purposes | 20 | ||||
SECTION 18. |
Election Under Delaware Asset-Backed Securities Facilitation Act | 21 | ||||
SECTION 19. |
Increases to Series Investor Interest | 21 |
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EXHIBITS
EXHIBIT A: Form of Series 2007-CC Investor Certificate
EXHIBIT B: Form of Certificateholders’ Monthly Statement
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DISCOVER CARD MASTER TRUST I
SERIES 2007-CC INVESTOR CERTIFICATE
SERIES 2007-CC INVESTOR CERTIFICATE
This Series of Master Trust Certificates is established pursuant to Section 6.06 of that
certain Amended and Restated Pooling and Servicing Agreement, dated as of November 3, 2004, as
amended, by and between DISCOVER BANK, a Delaware banking corporation (“Discover Bank”), as Master
Servicer, Servicer and Seller and U.S. BANK NATIONAL ASSOCIATION (the “Trustee”), as Trustee (the
“Pooling and Servicing Agreement”). The Pooling and Servicing Agreement and this series
supplement, by and among the Master Servicer, the Servicer, the Seller and the Trustee (the “Series
Supplement”) together establish the series of Master Trust Certificates to be known as the DISCOVER
CARD MASTER TRUST I, SERIES 2007-CC INVESTOR CERTIFICATE (“Series 2007-CC”). Series 2007-CC is an
Interchange Series that is a member of Group One of the Discover Card Master Trust I and is
eligible for reallocations to and from other series in Group One. (For purposes of any Series
Supplement for any other Series that requires that Interchange Series be so designated in their
Series Term Sheet, this introductory paragraph shall constitute the Series Terms Sheet for this
Series. For purposes of any Series Supplement for any other Series that allocates payments
sequentially by Class, the entire Series Investor Interest of this Series shall constitute Class
A.)
In consideration of the mutual agreements herein contained, each party agrees as follows for
the benefit of the other parties and for the benefit of the Investor Certificateholder:
SECTION 1. Definitions.
(a) Capitalized terms not otherwise defined in this Series Supplement shall have the meanings
ascribed to them in the Pooling and Servicing Agreement. Capitalized terms that refer to a Series
refer to Series 2007-CC.
(b) The following terms have the definitions set forth below with respect to Series 2007-CC,
unless the context otherwise clearly requires:
“Accumulation Period” with respect to any Note, shall have the meaning set forth in the
applicable Indenture Supplement.
“Additional Collateral Certificate” shall have the meaning set forth in the Indenture.
“Calculation Agent” shall have the meaning set forth in the Indenture.
“Charge-offs” shall have the meaning set forth in the Indenture.
“Class A Cumulative Investor Charged-Off Amount” on any Distribution Date, shall have the
meaning set forth in step (21) (Allocation from the Master Trust Group One Finance Charge
Collections Reallocation Account) of Section 3.01 of the Indenture Supplement for the
DiscoverSeries, as adjusted pursuant to Sections 9(b)(7) and 9(b)(10).
“Class A Principal Distribution Amount Shortfall” shall have the meaning set forth in step
(64) (Allocation from Group One Principal Collections Reallocation Account for Principal Shortfalls
other than Prefunding Shortfalls) of Section 3.01 of the Indenture Supplement for the
DiscoverSeries, as adjusted pursuant to Section 9(b)(15).
“Class A Required Amount Shortfall” on any Distribution Date, shall have the meaning set forth
in step (9) (Allocation from the Master Trust Group One Finance Charge Collections Reallocation
Account) of Section 3.01 of the Indenture Supplement for the DiscoverSeries, as adjusted pursuant
to Section 9(b)(6) and 9(b)(9).
“Clean-Up Call Amount” shall have the meaning set forth in Section 12(a).
“Controlled Liquidation Period” shall mean any period in which the Targeted Principal Deposit
minus the Targeted Prefunding Deposit for any Tranche of Notes is greater than zero.
“Discover Bank” shall have the meaning set forth in the recitals hereto.
“Discount Note” shall have the meaning set forth in the applicable Indenture Supplement.
“Distribution Date” shall mean the 15th day of each calendar month (or, if such day
is not a Business Day, the next succeeding Business Day) commencing in [___], 2007.
“Early Redemption Event” shall have the meaning set forth in the Indenture.
“Event of Default” shall have the meaning set forth in the Indenture.
“Excess Spread Amount” shall have the meaning set forth in the applicable Indenture
Supplement.
“Finance
Charge Allocation Amounts” with respect to any series, class
or Tranche of Notes, shall have the meaning set forth in the
Indenture.
“Finance Charge Amounts” shall have the meaning set forth in the Indenture.
“Group Excess Spread” shall mean, for any Distribution Date, the sum of the Series Excess
Spreads for each Series (including the Series established hereby) that is a member of the same
Group as the Series established hereby, in each case for such Distribution Date.
“Group Finance Charge Collections Reallocation Account” shall have the meaning specified in
Section 8.
“Group Interchange Reallocation Account” shall have the meaning specified in Section 8.
“Group Principal Collections Reallocation Account” shall have the meaning specified in Section
8.
“Indenture” shall mean that certain Indenture, dated as of [___], 2007, by and between
Discover Card Execution Note Trust and U.S. Bank National Association.
“Indenture Supplement” shall mean that certain Indenture Supplement, dated as of [___
___], 2007, by and between Discover Card Execution Note Trust and U.S. Bank National Association or,
as applicable, any subsequent indenture supplement entered into pursuant to the Indenture.
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“Indenture Trustee” shall have the meaning set forth in the Indenture.
“Initial Dollar Principal Amount” with respect to any Note, shall have the meaning set forth
in the applicable Indenture Supplement.
“Interchange Series” shall mean this Series and each series issued by the Trust that indicates
in its Series Supplement that it is an Interchange Series.
“Interchange Subgroup Allocable Group Excess Spread” shall mean, if the Group Excess Spread is
greater than or equal to zero, the product of the Group Excess Spread and the Interchange Subgroup
Excess Allocation Percentage; and if the Group Excess Spread is less than zero, the product of the
Group Excess Spread and the Interchange Subgroup Shortfall Allocation Percentage.
“Interchange Subgroup Excess Allocation Percentage” shall mean a ratio, the numerator of which
is the sum of the Series Investor Interest for each Interchange Series that is a member of the same
Group as the Series established hereby (including the Series established hereby); and the
denominator of which is the sum of the Series Investor Interests for each Series that is a member
of the same Group as the Series established hereby (including each Interchange Series and the
Series established hereby).
“Interchange Subgroup Excess Spread” shall mean, for any Distribution Date, the sum of (x) all
amounts deposited into the Group Interchange Reallocation Account for all Interchange Series and
(y) the Interchange Subgroup Allocable Group Excess Spread.
“Interchange Subgroup Shortfall Allocation Percentage” shall mean a ratio, the numerator of
which is the sum of the Series Excess Spread for each Interchange Series that is a member of the
same Group as the Series established hereby (including, if applicable, the Series established
hereby) for which the Series Excess Spread is less than zero; and the denominator of which is the
sum of the Series Excess Spread for each Series that is a member of the same Group as the Series
established hereby (including, if applicable, each Interchange Series and the Series established
hereby) for which the Series Excess Spread is less than zero.
“Investor Accounts” shall mean, in addition to Investor Accounts established pursuant to the
Pooling and Servicing Agreement, the Series Collections Account, the Series Distribution Account,
the Group Finance Charge Collections Reallocation Account, the Group Principal Collections
Reallocation Account and the Group Interchange Reallocation Account.
“Investor Certificateholder” shall mean, at any time, the holder or holders of the Series
2007-CC Collateral Certificate.
“Investor Servicing Fee” shall mean, with respect to any Distribution Date, an amount equal to
the product of the Investor Servicing Fee Percentage and the Series Investor Interest on the first
day of the Due Period related to such Distribution Date (or in the case of the first Distribution
Date for the Series established hereby, the Series Investor Interest on the Series Closing Date).
For purposes of this definition, the Series Investor Interest on the first day of any Due Period in
which an increase in the Series Investor Interest pursuant to Section 19 has occurred shall include
the amount of all such increases in the Series Investor Interest occurring during such Due Period.
3
“Investor Servicing Fee Percentage” shall mean 2.0% per annum calculated on the basis of a
360-day year of twelve 30-day months.
“Investor Servicing Fee Shortfall” shall have the meaning specified in Section 9(b)(3).
“Monthly Interest Accrual Period” shall have the meaning set forth in the applicable Indenture
Supplement.
“Nominal Liquidation Amount” with respect to any Note, shall have the meaning set forth in the
applicable Indenture Supplement.
“Note Issuance Trust” shall mean the Discover Card Execution Note Trust, formed pursuant to
that certain Trust Agreement, dated as of [___], 2007, by and between Discover Bank and
Wilmington Trust Company.
“Note Issuance Trust’s Annual Report Date” shall have the meaning specified in Section 4(b).
“Notes” shall mean any notes created under the applicable Indenture Supplement.
“Outstanding Dollar Principal Amount” with respect to any Note, shall have the meaning set
forth in the applicable Indenture Supplement.
“Paying Agent” shall mean the Corporate Trust Office of the Trustee.
“Pooling and Servicing Agreement” shall have the meaning set forth in the recitals hereto.
“Prefunding Negative Spread” shall have the meaning set forth in the applicable Indenture
Supplement.
“Principal Allocation Amount” with respect to any series, class or Tranche of Notes, shall
have the meaning set forth in the Indenture.
“Principal Distribution Amount Shortfall” when used for purposes of any Series Supplement for
any other series in the Group to which the Series established hereby belongs, shall mean the Class
A Principal Distribution Amount Shortfall.
“Required Daily Deposit” shall have the meaning set forth in the Indenture.
“Revolving Period” shall mean each Due Period, prior to the Series Termination Date, for which
the Targeted Principal Deposit for the related Distribution Date for all Notes is zero.
“Series 2007-CC” shall have the meaning set forth in the recitals hereto.
“Series 2007-CC Collateral Certificate” shall mean the Investor Certificate created under this
Series Supplement and initially issued to the Investor Certificateholder.
“Series 2007-CC Collateral Certificate Percentage” shall have the meaning set forth in the
Indenture.
4
“Series Charge-Off Allocation Percentage” shall mean, with respect to any Distribution Date or
any Trust Distribution Date, as applicable, the percentage equivalent of a fraction the numerator
of which shall be the amount of the Series Investor Interest and the denominator of which shall be
the greater of (i) the amount of Principal Receivables in the Trust and (ii) the Aggregate Investor
Interest, in each case on the first day of the related Due Period; for purposes of this definition,
the Series Investor Interest as of the first day of any Due Period in which the Series Closing Date
has occurred or the Series Investor Interest has been increased in accordance with Section 19 shall
include the Series Investor Interest as of the Series Closing Date and all increases in the Series
Investor Interest during such Due Period, as applicable.
“Series Closing Date” shall mean [___], 2007.
“Series Collections Account” shall have the meaning specified in Section 8.
“Series Distribution Account” shall have the meaning specified in Section 8.
“Series Excess Spread” shall, for any Distribution Date (i) so long as the only collateral
certificate owned by the Note Issuance Trust is the Series 2007-CC Collateral Certificate, mean the
sum of the Excess Spread Amounts for the DiscoverSeries and each additional series of Notes issued
under the Indenture or (ii) during any period when Additional Collateral Certificates are owned by
the Note Issuance Trust, have the meaning set forth in the documents relating to such addition
(provided that such documents are accepted and agreed to by the parties hereto).
“Series Finance Charge Allocation Percentage” shall mean, with respect to any Distribution
Date or any Trust Distribution Date, as applicable,
(a) so long as an Early Redemption Event or an Event of Default is not then continuing with
respect to a series, class or Tranche of Notes issued by the Note Issuance Trust, the percentage
equivalent of a fraction the numerator of which shall be the amount of the Series Investor Interest
on the first day of the related Due Period and the denominator of which shall be the greater of (i)
the amount of Principal Receivables in the Trust on the first day of the related Due Period and
(ii) the sum of the numerators used in calculating the components of the Series Percentage with
respect to Finance Charge Collections for each Series then outstanding (including the Series
established hereby) as of such Distribution Date or Trust Distribution Date, as applicable, or
(b) if an
Early Redemption Event or an Event of Default for any series, class or Tranche of
Notes issued by the Note Issuance Trust has occurred and is then continuing, the percentage
equivalent of a fraction the numerator of which shall be the Finance
Charge Allocation Amounts for each
series, class or Tranche of Notes multiplied by the Series 2007-CC Collateral Certificate Percentage; and the denominator
of which shall be the greater of (i) the amount of Principal Receivables in the Trust on the first
day of the related Due Period and (ii) the sum of the numerators used in calculating the components
of the Series Percentage with respect to Finance Charge Collections for each Series then
outstanding (including the Series established hereby) as of such Distribution Date or Trust
Distribution Date, as applicable;
for purposes of this definition, the Series Investor Interest as of the first day of any Due Period
in which the Series Closing Date has occurred or the Series Investor Interest has been increased in
5
accordance with Section 19 shall include the Series Investor Interest as of the Series Closing Date
and all increases in the Series Investor Interest during such Due Period, as applicable.
“Series Finance Charge Collections” shall mean with respect to any day or any Distribution
Date or Trust Distribution Date, as applicable, an amount equal to the product of (x) the Series
Finance Charge Allocation Percentage for the related Distribution Date and (y) the amount of
Finance Charge Collections for such day or for the related Due Period, as applicable; provided,
however, that Series Finance Charge Collections with respect to any Class of Notes shall be
increased by the lesser of (i) the amount of Series Prefunding Negative Spread for such Class and
(ii) an amount equal to the product of the total amount of Finance Charge Collections otherwise
allocable to Discover Bank on behalf of the Holder of the Seller Certificate for the related Due
Period and a fraction the numerator of which is the Series Invested Amount and the denominator of
which is the Aggregate Invested Amount.
“Series Interchange” shall mean, with respect to any Distribution Date or Trust Distribution
Date, as applicable, an amount equal to the product of (x) the Series Interchange Allocation
Percentage and (y) Interchange for the related Due Period.
“Series Interchange Allocation Percentage” shall mean, with respect to any Distribution Date
or Trust Distribution Date, as applicable, the percentage equivalent of a fraction the numerator of
which shall be the amount of Series Investor Interest and the denominator of which shall be the
greater of (i) the amount of Principal Receivables in the Trust and (ii) the Aggregate Investor
Interest, in each case on the first day of the related Due Period; for purposes of this definition,
the Series Investor Interest as of the first day of any Due Period in which the Series Closing Date
has occurred or the Series Investor Interest has been increased in accordance with Section 19 shall
include the Series Investor Interest of all Investor Certificates as of the Series Closing Date and
all increases in the Series Investor Interest during such Due Period, as applicable.
“Series Invested Amount” shall mean the product of (x) the sum of the Outstanding Dollar
Principal Amounts for all Notes issued by the Note Issuance Trust and (y) the Series 2007-CC
Collateral Certificate Percentage.
“Series Investor Charged-Off Amount” shall mean, with respect to this Series for any
Distribution Date, an amount equal to the product of (a) the Charged-Off Amount for such
Distribution Date and (b) the Series Charge-Off Allocation Percentage.
“Series Investor Interest” shall (i) so long as the only collateral certificate owned by the
Note Issuance Trust is the Series 2007-CC Collateral Certificate, mean an amount equal to the sum,
without duplication, of the Nominal Liquidation Amounts for each series, class or Tranche of Notes
then outstanding or (ii) during any period when Additional Collateral Certificates are owned by the
Note Issuance Trust, have meaning set forth in the documents relating to such addition (provided
that such documents are accepted and agreed to by the parties hereto).
“Series Minimum Principal Receivables Balance” shall mean, with respect to the Series
established hereby, on any date of determination (i) if no series, class or Tranche of Notes has a
Targeted Principal Deposit that is greater than zero, the Series Investor Interest on such date of
determination, divided by 0.93, and (ii) if any series, class or Tranche of Notes has a Targeted
Principal Deposit that is greater than zero, the percentage equivalent of a fraction, the numerator
of which shall be the sum of, without duplication, the Principal Allocation Amounts for each
6
such series, class or Tranche, multiplied by the Series 2007-CC Collateral Certificate
Percentage, divided by 0.93; provided, however, that Discover Bank on behalf of the Holder of the
Seller Certificate may, upon 30 days’ prior notice to the Trustee and the Rating Agencies, reduce
the Series Minimum Principal Receivables Balance by increasing the divisors set forth above,
subject to the condition that Discover Bank on behalf of the Holder of the Seller Certificate shall
have been notified by the Rating Agencies that such reduction would not result in the lowering or
withdrawal of the rating of any Class of any Series then outstanding, and provided, further, that
the divisors set forth above may not be increased to more than 0.98.
“Series Percentage” shall mean, with respect to Principal Collections, the “Series Principal
Collections Allocation Percentage” and with respect to Finance Charge Collections, the “Series
Finance Charge Collections Allocation Percentage.”
“Series Prefunding Negative Spread” shall mean the sum of the amounts of Prefunding Negative
Spread for each Tranche of Notes multiplied by the Series 2007-CC Collateral Certificate
Percentage.
“Series Principal Amounts” shall have the meaning set forth in the applicable Indenture
Supplement.
“Series Principal Collections” shall mean, with respect to any day or any Distribution Date or
Trust Distribution Date, as applicable, an amount equal to the product of (x) the Series Principal
Collections Allocation Percentage and (y) the amount of Principal Collections for such day or for
the related Due Period, as applicable.
“Series Principal Collections Allocation Percentage” shall mean, with respect to any
Distribution Date or any Trust Distribution Date, as applicable,
(a) if no series, class or Tranche of Notes has a Targeted Principal Deposit that is greater
than zero, the percentage equivalent of a fraction the numerator of which shall be the amount of
the Series Investor Interest on the first day of the related Due Period and the denominator of
which shall be the greater of (i) the amount of Principal Receivables in the Trust on the first day
of the related Due Period and (ii) the sum of the numerators used in calculating the components of
the Series Percentage with respect to Principal Collections for each Series then outstanding
(including the Series established hereby) as of such Distribution Date or Trust Distribution Date,
as applicable; or
(b) if any series, class or Tranche of Notes has a Targeted Principal Deposit that is greater
than zero, the percentage equivalent of a fraction, the numerator of which shall be the sum of the
Principal Allocation Amounts for each series, class or Tranche of Notes multiplied by the
Series 2007-CC Collateral Certificate Percentage; and the denominator of which shall be the greater
of (i) the amount of Principal Receivables in the Trust on the first day of the related Due Period
and (ii) the sum of the numerators used in calculating the components of the Series Percentage with
respect to Principal Collections for each Series then outstanding (including the Series established
hereby) as of such Distribution Date or Trust Distribution Date, as applicable;
for purposes of this definition, the Series Investor Interest as of the first day of any Due Period
in which the Series Closing Date has occurred or the Series Investor Interest has been increased in accordance with Section 19 shall include the Series Investor Interest of all Investor
7
Certificates as of the Series Closing Date and all increases in the Series Investor Interest during
such Due Period, as applicable.
“Series Required Principal Amount” shall mean, for this Series, with respect to each
Distribution Date of any Controlled Liquidation Period, the product of (x) (i) if the related Due
Period does not occur in February, 1.25 or (ii) if the related Due Period occurs in February, 1.05,
and (y) the product of (A) the sum of the Targeted Principal Deposits minus the Targeted Prefunding
Deposits for each Tranche of Notes for such Distribution Date and (B) the Series 2007-CC Collateral
Certificate Percentage, and with respect to each other Series that is a member of the same Group as
the Series established hereby, the “Series Required Principal Amount” specified in the Series
Supplement for such series for such Distribution Date.
“Series Servicing Fee” shall have the meaning set forth in the Indenture Supplement.
“Series Supplement” shall have the meaning set forth in the recitals hereto.
“Series Termination Date” shall mean, unless extended by the parties hereto, [___],
[2028] or, if earlier, the date on which the Nominal Liquidation Amount for all series, classes and
Tranches of Notes has been reduced to zero.
“Statement Date” shall mean each Distribution Date, commencing in [___], 2007.
“Targeted Prefunding Amount” shall have the meaning set forth in the applicable Indenture
Supplement.
“Targeted Prefunding Deposit” shall have the meaning set forth in the applicable Indenture
Supplement.
“Targeted Principal Deposit” shall have the meaning set forth in the applicable Indenture
Supplement.
“Tranche” shall have the meaning set forth in the Indenture.
“Transferred Assets” shall have the meaning set forth in Section 18 hereto.
“Trustee” shall have the meaning set forth in the recitals hereto.
“United States” or “U.S.” shall mean the United States of America, its territories and
possessions, any State of the United States and the District of Columbia.
“Unscheduled Principal Distribution Amount Shortfall” shall have the meaning set forth in the
applicable Indenture Supplement.
SECTION 2. Subordination.
(a) No Subordination of Series. Series 2007-CC shall not be subordinated in right of payment
to any other Series, whether currently outstanding or to be issued in the future. No other series
issued by the Trust may be subordinated in right of payment to Series 2007-CC.
SECTION 3. Representations and Warranties of the Sellers. The representations
and warranties of the Sellers contained in Section 2.04 of the Pooling
and Servicing Agreement and
8
the corresponding sections of any Assignment are true on and as of the
date hereof and/or the date set forth in the Pooling and Servicing Agreement, as applicable. Each
Seller also represents and warrants to the Trust as of the date hereof that:
(a) The execution, delivery and performance of this Series Supplement by such Seller have been
duly authorized by all necessary corporate action, do not require any approval or consent of any
governmental agency or authority, do not and will not conflict with any material provision of the
Certificate of Incorporation or By-Laws of such Seller, do not and will not conflict with, or
result in a breach which would constitute a material default under, any agreement for borrowed
money binding upon or applicable to it or such of its property which is material to it, or, to the
best of such Seller’s knowledge, any law or governmental regulation or court decree applicable to
it or such material property, and this Series Supplement is the valid, binding and enforceable
obligation of such Seller, except as the same may be limited by receivership, insolvency,
reorganization, moratorium or other laws relating to the enforcement of creditors’ rights generally
or by general equity principles.
(b) The Pooling and Servicing Agreement creates a valid and enforceable security interest (as
defined in the applicable UCC) which security interest is prior to all other Liens and is
enforceable as such against creditors of and purchasers from Seller, except as the same may be
limited by receivership, insolvency, reorganization, moratorium or other laws relating to the
enforcement of creditors’ rights generally or by general equity principles.
(c) The Receivables constitute “accounts” within the meaning of Article 9 of the applicable
UCC.
(d) Each Seller has caused or will have caused, within ten days of the date of this Series
Supplement, 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 (as
defined in the applicable UCC) in the Receivables conveyed to the Trustee under the Pooling and
Servicing Agreement.
(e) Other than the sale, transfer, assignment and conveyance of the Receivables to the Trust
and the grant of a security interest therein pursuant to the Pooling and Servicing Agreement, the
Seller has not pledged, assigned, sold, granted a security interest in or otherwise conveyed any of
the Receivables.
(f) The Seller has not authorized the filing of and is not aware of any financing statements
against the Seller that include a description of collateral covering the Receivables, other than
any financing statement (i) relating to the interest of the Trust in the Receivables under the
Pooling and Servicing Agreement or (ii) that has been terminated.
(g) The Seller is not aware of any judgment or tax lien filings against it.
The representations and warranties set forth in this Section 3 shall survive the transfer and
assignment to the Trust of the Receivables transferred to the Trust by the Sellers. None of (i)
compliance with the representations and warranties set forth in this Section 3, (ii) compliance
with the representations and warranties set forth in Sections 2.04(d) and (e) of the Pooling
and Servicing Agreement or (iii) compliance with the provisions of Section 13.02 of the Pooling and
9
Servicing Agreement can be waived by the Trustee without the prior written consent of Standard &
Poor’s.
SECTION 4. Representations, Warranties and Covenants of Discover Bank as Master Servicer and
Servicer.
(a) Representations and Warranties. The representations and warranties of Discover Bank as
the Master Servicer and as a Servicer contained in Section 3.04 of the Pooling and Servicing
Agreement are true on and as of the date hereof. Discover Bank as Master Servicer and Servicer
also represents and warrants to the Trust as of the date hereof that the execution, delivery and
performance of this Series Supplement by Discover Bank have been duly authorized by all necessary
corporate action, do not require any approval or consent of any governmental agency or authority,
do not and will not conflict with any material provision of the Certificate of Incorporation or
By-Laws of Discover Bank, do not and will not conflict with, or result in a breach which would
constitute a material default under, any agreement for borrowed money binding upon or applicable to
it or such of its property which is material to it, or, to the best of Discover Bank’s knowledge,
any law or governmental regulation or court decree applicable to it or such material property, and
this Series Supplement is the valid, binding and enforceable obligation of Discover Bank, except as
the same may be limited by receivership, insolvency, reorganization, moratorium or other laws
relating to the enforcement of creditors’ rights generally or by general equity principles.
(b) Regulation AB Compliance. The Master Servicer and each Servicer agree that the provisions
of Article XIV of the Pooling and Servicing Agreement shall be for the benefit of the Note Issuance
Trust. Without limiting the foregoing, the Master Servicer and each Servicer agree that (i) they
will make available to the depositor for the Note Issuance Trust, on or before the date on which
the Note Issuance Trust is required to file its Annual Report pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934 on Form 10-K with the Securities and Exchange Commission (the
“Note Issuance Trust’s Annual Report Date”), such assessments, attestations, compliance
certificates and other materials consistent in scope with those provided to the Seller under
Article XIV, (ii) they will provide such additional information and disclosures as shall be
necessary for any prospectus or other offering document for the Notes to comply with Regulation AB,
consistent with the requirements of Article XIV, and (iii) they shall use their best efforts to
cause any Servicing Participant used by them (directly or indirectly) for the benefit of the
Sellers to comply with the provisions of this Section 4(b) to the same extent as if such Servicing
Participant were the Master Servicer or the Servicer. The Master Servicer and each Servicer
acknowledge that the depositor for the Note Issuance Trust or any other Person that will be
responsible for signing the Sarbanes Certification on behalf of the Note Issuance Trust may rely on
the certifications provided pursuant to this Section 4(b) in signing a Sarbanes Certification and
filing such certification with the Commission.
SECTION 5. Representations and Warranties of Other Servicers. The representations and
warranties of each Servicer (other than Discover Bank), if any,
contained in Section 3.05 of the Pooling and Servicing Agreement are true and correct on and as
of the date hereof. Each such Servicer also represents and warrants to the Trust as of the
date hereof that the execution, delivery and performance of this Series Supplement by such Servicer
have been duly authorized by all necessary corporate action, do not require any approval or consent
of any governmental agency or authority, do not and will not conflict with any material provision
of the Certificate of Incorporation or By-Laws of such Servicer, do not and will not conflict with,
or result in a
10
breach which would constitute a material default under, any agreement for borrowed
money binding upon or applicable to it or such of its property which is material to it, or, to the
best of such Servicer’s knowledge, any law or governmental regulation or court decree applicable to
it or such material property, and this Series Supplement is the valid, binding and enforceable
obligation of such Servicer, except as the same may be limited by receivership, insolvency,
reorganization, moratorium or other laws relating to the enforcement of creditors’ rights generally
or by general equity principles.
SECTION 6. Representations, Warranties and Covenants of the Trustee.
(a) Representations and Warranties. The representations and warranties of the Trustee
contained in Section 11.16 of the Pooling and Servicing Agreement are true on and as of the date
hereof. The Trustee also represents and warrants as of the date hereof that the Trustee has full
power, authority and right to execute, deliver and perform this Series Supplement, and has taken
all necessary action to authorize the execution, delivery and performance by it of this Series
Supplement, and this Series Supplement has been duly executed and delivered by the Trustee.
(b) Regulation AB Compliance. The Trustee agrees that the provisions of Article XIV of the
Pooling and Servicing Agreement shall be for the benefit of the Note Issuance Trust. Without
limiting the foregoing, the Trustee agrees that (i) it will make available to the depositor for the
Note Issuance Trust, on or before the Note Issuance Trust’s Annual Report Date, such assessments,
attestations, compliance certificates and other materials consistent in scope with those provided
to the Seller under Article XIV and (ii) it will provide such additional information and
disclosures as shall be necessary for any prospectus or other offering document for the Notes to
comply with Regulation AB, consistent with the requirements of Article XIV. The Trustee
acknowledges that the depositor for the Note Issuance Trust or any other Person that will be
responsible for signing the Sarbanes Certification on behalf of the Note Issuance Trust may rely on
the certifications provided pursuant to this Section 6(b) in signing a Sarbanes Certification and
filing such certification with the Commission.
SECTION 7. Authentication of Certificates. Pursuant to the request of
the Sellers, the Trustee shall cause the Series 2007-CC
Collateral Certificate, in substantially the form of Exhibit A hereto, to be duly
authenticated and delivered as of the Series Closing Date to or upon the order of the Sellers
pursuant to Section 6.06 of the Pooling and Servicing Agreement. The 2007-CC Collateral
Certificate shall be issued in fully registered form, without coupons.
SECTION 8. Establishment and Administration of Investor Accounts.
(a) The Series Distribution Account and Series Collections Account. The Trustee, for the
benefit of the Certificateholders, shall cause to be established and maintained in the name of the
Trust, with the corporate trust department of an office or branch of either the Trustee or a
Qualified Institution, two non-interest bearing segregated trust accounts (the “Series Distribution
Account”; and, for Collections the “Series Collections Account”) bearing a designation clearly
indicating that the funds deposited therein are held for the benefit of the Investor
Certificateholder. The Trust shall possess all right, title and interest in all funds on deposit
in the Series Distribution Account and the Series Collections Account; provided, however, that all
interest and earnings (less investment expenses) on funds on deposit in any such account shall be
paid to the Holder of the Seller Certificate in accordance with Section 4.02(c) of
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the Pooling and Servicing Agreement. Pursuant to authority granted to it pursuant to Section 3.01(b) of the
Pooling and Servicing Agreement, the Master Servicer shall have the revocable power to instruct the
Trustee to withdraw funds from the Series Distribution Account and the Series Collections Account
for the purpose of carrying out the duties of the Master Servicer hereunder. The Master Servicer
at all times shall maintain accurate records reflecting each transaction in the Series Distribution
Account and the Series Collections Account. The Paying Agent also shall have the revocable
authority to make withdrawals from the Series Distribution Account.
(b) Reallocation Accounts. The Trustee, for the benefit of the Certificateholders, shall
cause to be established and maintained in the name of the Trust, with the corporate trust
department of an office or branch of either the Trustee or a Qualified Institution, three
non-interest bearing segregated trust accounts for the Group of which the Series established hereby
is a member (for reallocated Series Finance Charge Collections and similar amounts for other
series, the “Group Finance Charge Collections Reallocation Account,” for reallocated Series
Principal Collections and amounts used to reimburse charge-offs for this Series and other series in
the Group of which this Series is a member, the “Group Principal Collections Reallocation Account”
and for reallocated Series Interchange and similar amounts for other series, the “Group Interchange
Reallocation Account”) bearing a designation clearly indicating that the funds deposited therein
are held for the benefit of the Investor Certificateholder. The Trust shall possess all right,
title and interest in all funds on deposit from time to time in the Group Finance Charge
Collections Reallocation Account, the Group Principal Collections Reallocation Account and the
Group Interchange Reallocation Account in all proceeds thereof. Pursuant to authority granted to
it pursuant to Section 3.01(b) of the Pooling and Servicing Agreement, the Master Servicer shall
have the revocable power to instruct the Trustee to withdraw funds from the Group Finance Charge
Collections Reallocation Account, the Group Principal Collections Reallocation Account and the
Group Interchange Reallocation Account for the purpose of carrying out the duties of the Master
Servicer hereunder. The Master Servicer at all times shall maintain accurate records reflecting
each transaction in the Group Finance Charge Collections Reallocation Account, the Group Principal
Collections Reallocation Account and the Group Interchange Reallocation Account.
(c) Transfer of Investor Accounts. If at any time any of the Investor Accounts established in
Sections 8(a) through 8(b) is not being held by the Trustee and the institution holding such
Investor Account ceases to be a Qualified Institution, the Master Servicer shall within 10 Business
Days establish a new Investor Account (meeting any conditions specified in this Series Supplement
with respect to such Investor Account) with a Qualified Institution and transfer any cash and/or
any investments to such new Investor Account.
SECTION 9. Allocations of Collections.
(a) Deposits to Series Collections Account. On or before each Distribution Date, the Master
Servicer shall direct the Trustee in writing to withdraw from the Group Collections Account and
deposit into the Series Collections Account an amount equal to the sum of the Series Finance Charge
Collections, the Series Principal Collections and the Series Interchange for the related Due
Period.
(b) Deposits. The Master Servicer shall, on or before each Distribution Date, direct the
Trustee in writing that funds be paid or deposited in the following amounts, to the
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extent such funds are available and in the order of priority specified, to the account or Person indicated, in
each case as set forth below.
(1) Series Finance Charge Collections and Series Interchange to Series Distribution Account.
An amount equal to the sum of (x) Series Finance Charge Collections and (y) Series
Interchange shall be withdrawn from the Series Collections Account and deposited into the
Series Distribution Account.
(2) Series Principal Collections to Series Distribution Account. An amount equal to the
Series Principal Collections shall be withdrawn from the Series Collections Account and
deposited into the Series Distribution Account.
(3)
Investor Servicing Fee from Series Distribution Account. An amount equal to the lesser of
(x) | the Investor Servicing Fee and | ||
(y) | the portion of the Series Servicing Fee payable to the Master Servicer under step 7 (Series Servicing Fee from Series Finance Charge Amounts) of Section 3.01 of the Indenture Supplement for the DiscoverSeries (and any comparable step under any other Indenture Supplement, as applicable) |
shall be withdrawn from the Series Distribution Account and paid to the Master Servicer. The
amount by which the Investor Serving Fee exceeds the amount of such payment shall be the “Investor
Servicing Fee Shortfall.”
(4) Reallocation to Group Finance Charge Collections Reallocation Account. An amount, if
any, equal to the portion of Series Finance Charge Amounts for the Note Issuance Trust that
are to be reallocated to the Group Finance Charge Collections Reallocation Account under
step (56) (Reallocation of Series Finance Charge Amounts to the Master Trust Group One
Finance Charge Collections Reallocation Account) of Section 3.01 of the Indenture Supplement
for the DiscoverSeries (and any comparable step under any other Indenture Supplement, as
applicable) shall be withdrawn from the Series Distribution Account and deposited into the
Group Finance Charge Collections Reallocation Account.
(5) Reallocation to Group Interchange Reallocation Account. An amount, if any, equal to the
portion of Series Finance Charge Amounts for the Note Issuance Trust that are to be reallocated to
the Group Interchange Reallocation Account under step (57) (Reallocation of Series Finance Charge
Amounts to the Master Trust Group One Interchange Reallocation Account) of Section 3.01 of the
Indenture Supplement for the DiscoverSeries (and any comparable step under any other Indenture
Supplement, as applicable) shall be withdrawn from the Series Distribution Account and deposited
into the Group Interchange Reallocation Account.
(6) Reallocation from Group Finance Charge Collections Reallocation Account for Class A
Required Amount Shortfall. An amount equal to the lesser of
(x) | the Class A Required Amount Shortfall and |
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(y) | the product of |
(1) | a fraction the numerator of which is the Class A Required Amount Shortfall for this Series and the denominator of which is the sum of the Class A Required Amount Shortfalls for this Series and for all Classes designated as Class A of all other series in the Group to which the Series established hereby belongs (after giving effect to provisions in the applicable Series Supplements substantially similar to the clauses preceding this clause (6)) and | ||
(2) | the amount on deposit in the Group Finance Charge Collections Reallocation Account before any withdrawals therefrom with respect to any other series pursuant to a comparable clause in the applicable Series Supplements, |
shall be withdrawn from the Group Finance Charge Collections Reallocation Account and deposited
into the Series Distribution Account. The Class A Required Amount Shortfall shall be reduced by
the amount of such deposit.
(7) Reallocation from Group Finance Charge Collections Reallocation Account for Class A
Cumulative Investor Charged-Off Amount. An amount equal to the lesser of
(x) | the Class A Cumulative Investor Charged-Off Amount and | ||
(y) | the product of |
(1) | a fraction the numerator of which is the Class A Cumulative Investor Charged-Off Amount and the denominator of which is the sum of the Class A Cumulative Investor Charged-Off Amounts for this Series and for all Classes designated as Class A of all other series in the Group to which the Series established hereby belongs (after giving effect to provisions in the applicable Series Supplements substantially similar to the clauses preceding this clause (7)) and | ||
(2) | the amount on deposit in the Group Finance Charge Collections Reallocation Account before any withdrawals therefrom with respect to any other series pursuant to a comparable clause in the applicable Series Supplements, |
shall be withdrawn from the Group Finance Charge Collections Reallocation Account and deposited
into the Series Distribution Account. The Class A Cumulative Investor Charged-Off Amount shall be
reduced by the amount of such deposit.
(8) Reallocation from Group Finance Charge Collections Reallocation Account for other
Series. After the allocations set forth in clauses (6) and (7) are made, then (i) if there
are one or more Subordinate Classes with respect to any other series in the Group to which
the Series established hereby belongs, the allocations set forth in other Series
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Supplements which are substantially similar to clauses (6) and (7) shall be made with respect to each
other such Class, in alphabetical order, to the extent that funds are available pursuant to
this clause (8) and (ii) following the allocations set forth in clause (i), any other
allocations set forth in other Series Supplements with respect to funds on deposit in the
Group Finance Charge Collections Reallocation Account shall be made in accordance with such
Series Supplements, to the extent that funds are available pursuant to this clause (8).
(9) Reallocation from Group Interchange Reallocation Account for Class A Required Amount
Shortfall. An amount equal to the lesser of
(x) | the Class A Required Amount Shortfall and | ||
(y) | the product of |
(1) | a fraction the numerator of which is the Class A Required Amount Shortfall and the denominator of which is the sum of the Class A Required Amount Shortfalls for this Series and for all Classes designated as Class A of all other Interchange Series in the Group to which the Series established hereby belongs (after giving effect to provisions in the applicable Series Supplements substantially similar to the clauses preceding this clause (9)) and | ||
(2) | the amount on deposit in the Group Interchange Reallocation Account before any withdrawals therefrom with respect to any other series pursuant to a comparable clause in the applicable Series Supplements, |
shall be withdrawn from the Group Interchange Reallocation Account and deposited into the Series
Distribution Account. The Class A Required Amount Shortfall shall be reduced by the amount of such
deposit.
(10) Reallocation from Group Interchange Reallocation Account for Class A Cumulative
Charge-Off Amount. An amount equal to the lesser of
(x) | the Class A Cumulative Investor Charged-Off Amount and | ||
(y) | the product of |
(1) | a fraction the numerator of which is the Class A Cumulative Investor Charged-Off Amount and the denominator of which is the sum of the Class A Cumulative Investor Charged-Off Amounts for this Series and for all Classes designated as Class A of all other Interchange Series in the Group to which the Series established hereby belongs (after giving effect to provisions in the applicable Series Supplements substantially similar to the clauses preceding this clause (10)) and |
15
(2) | the amount on deposit in the Group Interchange Reallocation Account before any withdrawals therefrom with respect to any other series pursuant to a comparable clause in the applicable Series Supplements, |
shall be withdrawn from the Group Interchange Reallocation Account and deposited into the Series
Distribution Account. The Class A Cumulative Investor Charged-Off Amount shall be reduced by the
amount of such deposit.
(11) Reallocation from Group Interchange Reallocation Account for other Series After the
allocations set forth in clauses (9) and (10) are made, then (i) if there are one or more
Subordinate Classes with respect to any other series in the Group to which the Series
established hereby belongs, the allocations set forth in other Series Supplements which are
substantially similar to the allocations set forth in clauses (9) and (10) shall be made
with respect to each other such Class, in alphabetical order, to the extent that funds are
available pursuant to this clause (11) and (ii) following the allocations set forth in
clause (i), any other allocations set forth in other Series Supplements with respect to
funds on deposit in the Group Interchange Reallocation Account shall be made in accordance
with such Series Supplements, to the extent that funds are available pursuant to this clause
(11).
(12) Investor Servicing Fee from Series Distribution Account after Reallocations from Group
Finance Charge Collections Reallocation Account. An amount equal to the lesser of
(x) | the Investor Servicing Fee Shortfall after step (3) and | ||
(y) | the portion of the Series Servicing Fee payable to the Master Servicer under step 14 (Series Servicing Fee from Reallocated Finance Charge Amounts) of Section 3.01 of the Indenture Supplement for the DiscoverSeries (and any comparable step under any other Indenture Supplement, as applicable) |
shall be withdrawn from the Series Distribution Account and paid to the Master Servicer. The
Investor Servicing Fee Shortfall shall be reduced by the amount of such payment.
(13) Reallocation from Subordinated Notes Principal for Investor Servicing Fee Shortfall. An
amount equal to the lesser of
(x) | the Investor Servicing Fee Shortfall after step (12) and | ||
(y) | the portion of the Series Servicing Fee payable to the Master Servicer under each of steps (41) (Series Servicing Fee Shortfall from Class D Principal), (42) (Series Servicing Fee Shortfall from Class C Principal) and (43) (Series Servicing Fee Shortfall from Class B Principal), as applicable, of Section 3.01 of the Indenture Supplement for the DiscoverSeries (and any comparable steps under any other Indenture Supplement, as applicable) |
shall be withdrawn from the Series Distribution Account and paid to the Master Servicer.
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(14) Reallocation to Group Principal Collections Reallocation Account. An amount equal to
the portion of Series Principal Amounts for the Note Issuance Trust that are to be
reallocated to the Group Principal Collections Reallocation Account under step (79)
(Reallocation of Series Principal Amounts to the Master Trust Group One Principal
Collections Reallocation Account) of Section 3.01 of the Indenture Supplement for the
DiscoverSeries (and any comparable step under any other Indenture Supplement, as applicable)
shall be withdrawn from the Series Distribution Account and deposited into the Group
Principal Collections Reallocation Account.
(15) Reallocation from Group Principal Collections Reallocation Account for Class A
Principal Distribution Amount Shortfall. An amount equal to the lesser of
(x) | the Class A Principal Distribution Amount Shortfall and | ||
(y) | the product of |
(1) | a fraction the numerator of which is the Class A Principal Distribution Amount Shortfall and the denominator of which is the sum of the Class A Principal Distribution Amount Shortfall for this Series and the portions of the Principal Distribution Amount Shortfalls allocable to all Class A certificates of all other series in the Group to which the Series established hereby belongs that are in their Accumulation Periods or Controlled Liquidation Periods, as applicable (after giving effect to provisions in the applicable Series Supplements substantially similar to the clauses preceding this clause (15)) and | ||
(2) | the amount on deposit in the Group Principal Collections Reallocation Account before any withdrawals therefrom with respect to any other series |
shall be withdrawn from the Group Principal Collections Reallocation Account and deposited into the
Series Distribution Account. The Class A Principal Distribution Amount Shortfall shall be reduced
by the amount of such deposit.
(16) Group Principal Collections Reallocation Account for other Series. After the
allocations set forth in clause (15) are made, then (i) if there are one or more Subordinate
Classes with respect to any other series in the Group to which the Series established
hereby belongs, the allocations set forth in other Series Supplements which are
substantially similar to clause (15) shall be made with respect to each other such Class, in
alphabetical order and (ii) following the allocations set forth in clause (i), any other
allocations set forth in other Series Supplements with respect to funds on deposit in the
Group Principal Collections Reallocation Account shall be made in accordance with such
Series Supplements.
(17) Reallocation from Group Principal Collections Reallocation Account for Unscheduled
Principal Distribution Amount Shortfall. An amount equal to the lesser of
(x) | the Unscheduled Principal Distribution Amount Shortfall and |
17
(y) | the product of |
(1) | a fraction the numerator of which is the Unscheduled Principal Distribution Amount Shortfall and the denominator of which is the sum of the Unscheduled Principal Distribution Amount Shortfall for this Series and any other series in the Group to which the Series established hereby belongs (after giving effect to provisions in the applicable Series Supplements substantially similar to the clauses preceding this clause (17)), and | ||
(2) | the amount on deposit in the Group Principal Collections Reallocation Account before any withdrawals therefrom with respect to any other series |
shall be withdrawn from the Group Principal Collections Reallocation Account and deposited into the
Series Distribution Account.
(18) After all allocations from the Group Principal Collections Reallocation Account to
be made pursuant to any other Series Supplement for any series that is a member of the same
Group of which the Series established hereby is a member have been made, the amount
remaining on deposit in the Group Principal Collections Reallocation Account shall be
withdrawn from the Group Principal Collections Reallocation Account and deposited into the
Collections Account.
(19) An amount equal to the portion of Series Principal Amounts for the Note Issuance Trust
that are to be deposited into the Collections Account pursuant to step (80) (Remaining
Series Principal Amounts to Collections Account for Master Trust for Reinvestment in New
Receivables) of Section 3.01 of the Indenture Supplement for the DiscoverSeries (and any
comparable step under any other Indenture Supplement, as applicable) shall be withdrawn from
the Series Distribution Account and deposited into the Collections Account.
(20) All remaining amounts in the Series Distribution Account shall be paid to the Indenture
Trustee for application in accordance with the Indenture and each applicable Indenture
Supplement.
(21) After all other allocations have been provided for with respect to each series then
outstanding (whether or not such Series is a member of the same Group as the Series
established hereby), the lesser of
(x) | the amount of Seller Interest and | ||
(y) | the amount on deposit in the Collections Account |
shall be paid to the Holder of the Seller Certificate. If, after such payment, any amounts remain
on deposit in the Collections Account, such amounts shall remain in the Collections Account for
allocation as Principal Collections on the next Trust Distribution Date.
SECTION 10. Servicing Compensation. As compensation for its servicing activities hereunder and under the Pooling and Servicing
Agreement and reimbursement of its expenses as
18
set forth in Section 3.03 of the Pooling and
Servicing Agreement, the Master Servicer shall be entitled to receive the Investor Servicing Fees
with respect to the Series established hereby in respect of any Due Period (or portion thereof)
prior to the earlier of the date on which the Series Investor Interest is reduced to zero and the
Series Termination Date. The Investor Servicing Fees shall be paid to the Master Servicer on each
Distribution Date pursuant to the terms hereof and the Indenture and each applicable Indenture
Supplement.
SECTION 11. Investor Certificateholders’ Monthly Statement. On each Statement Date, a statement substantially in the form of Exhibit B as prepared by
the Trustee (based on information provided by the Master Servicer) setting forth the information
listed thereon shall be available to the Investor Certificateholder and to any holder of Notes from
the Trustee, each Paying Agent and, if applicable, the Listing Agent.
SECTION 12. Purchase of Notes; Sales of Receivables.
(a) The Indenture Supplement for the DiscoverSeries and any additional Indenture Supplement
issued with respect to any Notes may provide that if, as of any Distribution Date (after giving
effect to any payments calculated pursuant to Section 3.01 of the applicable indenture supplement
made on such Distribution Date), the Outstanding Dollar Principal Amount with respect to any
series, class or Tranche of Notes is less than or equal to 5% of the Initial Principal Dollar
Amount of each corresponding Tranche or Tranches of Notes, the Note Issuance Trust may elect to
repurchase such series, class or Tranche of Notes. In the event of such election, the Calculation
Agent shall request that Discover Bank, on behalf of the Holder of the Seller Certificate, purchase
and cancel a portion of the Series Investor Interest equal to the product of (x) the Nominal
Liquidation Amount of such series, class or Tranche of Notes and (y) the Series 2007-CC Collateral
Certificate Percentage (such portion, the “Clean-Up Call Amount”) by depositing into the Series
Distribution Account, on the immediately succeeding Distribution Date, an amount equal to the
Clean-Up Call Amount. If Discover Bank on behalf of the Holder of the Seller Certificate deposits
the Clean-Up Call Amount into the Series Distribution Account, the Master Servicer shall direct the
Trustee in writing to withdraw the Clean-Up Call Amount from the Series Distribution Account and pay such amount to the Indenture
Trustee for distribution in accordance with the applicable Indenture Supplement.
(b) If there has been an Event of Default and acceleration of any Tranche of Notes under the
Indenture, and the Indenture Trustee is directed to cause the sale of Receivables in accordance
with Section 705 of the Indenture and the provisions of the applicable Indenture Supplement, or if
the applicable Indenture Supplement otherwise authorizes the Indenture Trustee (in its discretion)
to cause a sale and any conditions precedent thereto have been satisfied, the Indenture Trustee
shall notify the Trustee of the amount of Receivables to be sold, which shall equal the Nominal
Liquidation Amount of each affected Tranche plus accrued interest thereon multiplied by the Series
2007-CC Collateral Certificate Percentage (the “Receivables Sale Amount”). Receivables (or
interests therein) in an amount equal to the Receivables Sale Amount shall be sold on behalf of the
Trust by an institution acceptable to the Trustee, the Indenture Trustee and the Master Servicer
that is either (i) a nationally recognized investment bank, (ii) a nationally recognized commercial
bank or (iii) any other institution whose regular business includes the sale of receivables similar
to the Receivables in the Trust; provided, however, that in no event shall the amount of
Receivables sold hereunder with respect to any Tranche exceed the product of (A) the aggregate
amount of Receivables in the Trust and (B) a fraction the numerator of which is the product of the
Nominal Liquidation Amount of such
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Tranche and the Series 2007-CC Collateral Certificate
Percentage, and the denominator of which is the Aggregate Investor Interest, in each case, on the
Distribution Date in the month immediately preceding the month in which such Receivables sale
occurs; and provided, further, the Receivables selected to be sold hereunder shall not be
materially different from the Receivables remaining in the Trust as of such Distribution Date and
shall be selected at random from the Receivables. The proceeds (the “Receivables Sale Proceeds”)
therefrom shall be paid to the Trust and immediately deposited into the Series Distribution Account
with respect and paid to the Indenture Trustee immediately following such deposit. Such payment
shall be deemed to be the final distribution with respect to the affected Tranche. No Seller and
no affiliate or agent of any Seller shall be permitted to bid for or purchase Receivables pursuant
to this Section 12(b); provided, however, that an affiliate or agent may act as selling institution
for the sale as specified in the first sentence of this Section 12(b), so long as such affiliate or
agent does not act as principal in connection with such sale.
SECTION 13. Ratification of Pooling and Servicing Agreement. As supplemented and amended by this Series Supplement, the Pooling and Servicing Agreement
is in all respects ratified and confirmed and the Pooling and Servicing Agreement as so
supplemented by this Series Supplement shall be read, taken, and construed as one and the same
instrument.
SECTION 14. Counterparts. This Series Supplement may be executed in any number of counterparts, each of which so
executed shall be deemed to be an original, but all of such counterparts shall together constitute
but one and the same instrument.
SECTION 15. Governing Law. This Series Supplement and all disputes arising out of or relating to it shall be construed
in accordance with the internal laws of the State of New York, without reference to its conflict of
law provisions that would result in the application of the law of any state other than New
York, and the obligations, rights and remedies of the parties hereunder shall be determined in
accordance with such laws.
SECTION 16. Intention of Parties. The parties intend the sale, transfer, assignment or conveyance of Receivables, Interchange
and all proceeds thereof in connection herewith to be a sale of financial assets in connection with
a securitization and an absolute transfer for all purposes (other than for federal, state and local
income and franchise tax purposes). The parties intend the sale, transfer, assignment or
conveyance of Receivables in connection herewith to be treated as a sale for accounting purposes.
SECTION 17. Amendment for Sale Accounting Purposes. If any Seller determines that (i) an amendment to this Agreement or the Pooling and
Servicing Agreement is necessary or desirable for such Seller to maintain or establish sale
accounting treatment under then-applicable financial accounting standards, and (ii) such Seller
cannot enter into such amendment pursuant to Section 13.01 of the Pooling and Servicing Agreement
without obtaining the consent of a specified percentage of Investor Certificateholders, then the
Master Servicer, the Sellers, the Trustee and the Servicers may nonetheless enter into such
amendment without obtaining the consent of any Certificateholder of any Investor Certificates of
this Series so long as the Trustee shall have been advised by the Rating Agencies that such
amendment will not result in the downgrading or withdrawal of the rating assigned to any Class of
any Series then outstanding.
Any such amendment may include, without limitation, any changes necessary to convert the Trust
from a “one-tier” securitization structure to a “two-tier” securitization structure.
20
Notwithstanding the foregoing, any Investor Certificateholder that acquires an Investor Certificate
of this Series will be deemed to have consented to any such amendment for all purposes, including
for purposes of calculating whether the requisite consent percentage, if any, under Section 13.01
of the Pooling and Servicing Agreement has been received for any amendment that requires such
consent because of the lack of provisions comparable to this Section 17 in the Series Supplements
for other series then outstanding (except that Investor Certificates beneficially owned by any
Seller or any affiliate or agent of any Seller will not be included in any such calculation).
SECTION 18. Election Under Delaware Asset-Backed Securities Facilitation Act. Without limiting any other provisions of the Pooling and Servicing Agreement or this Series
Supplement, the parties hereto agree that (a) the transactions contemplated hereby constitute a
“securitization transaction” and (b) to the fullest extent permitted under applicable law,
including without limitation, the Asset-Backed Securities Facilitation Act Delaware Code Xxx. tit.
6, § 2703A et seq: (1) all right, title and interest to the Receivables, whether now existing or
hereafter acquired, all monies due or to become due with respect thereto, all proceeds of such
Receivables and all Interchange (the “Transferred Assets”), which have been transferred to the
Trust in connection with the securitization transactions contemplated herein, shall be deemed to no
longer be the property, assets or rights of the Seller; (2) the Seller, its creditors or, in any
insolvency proceeding with respect to the Seller or the Seller’s property, a bankruptcy trustee,
receiver, debtor, debtor in possession or similar person, shall have no rights, legal or
equitable, whatsoever to reacquire, reclaim, recover, repudiate, disaffirm, redeem or
recharacterize as property of the Seller any of the Transferred Assets; and (3) in the event of a
bankruptcy, receivership or other insolvency proceeding with respect to the Seller or the Seller’s
property, such Transferred Assets shall not be deemed to be part of the Seller’s property, assets,
rights or estate.
SECTION 19. Increases to Series Investor Interest. In connection with any issuance of Notes, Discover Bank shall transfer to the Note Issuance
Trust an additional fractional undivided interest in the assets of the Trust as represented by an
increase in the Series Investor Interest for the Series 2007-CC Collateral Certificate from time to
time, subject to the satisfaction of the conditions described below:
(a) The Calculation Agent shall have notified Discover Bank, as Holder of the Seller
Certificate, of the issuance of such Notes and Discover Bank shall have notified the Calculation
Agent of its intention to transfer to the Note Issuance Trust an additional fractional undivided
interest in the assets of the Trust as represented by an increase in the Series Investor Interest
in an amount equal to the product of (i) the Nominal Liquidation Amount of any Notes to be issued
by the Note Issuance Trust and (ii) the percentage of the Nominal Liquidation Amount of such Notes
to be allocated to the Series 2007-CC Collateral Certificate, as determined by Discover Bank as
beneficiary of the Note Issuance Trust;
(b) Discover Bank, as Holder of the Seller Certificate, shall have received an amount equal to
(i) the issuance proceeds received by the Note Issuance Trust in connection with the corresponding
issuance of Notes, multiplied by the percentage of the Nominal Liquidation Amount of such Notes to
be allocated to the Series 2007-CC Collateral Certificate, minus (ii) the sum of (x) any issuance
expenses relating to such notes multiplied by the percentage of the Nominal Liquidation Amount of
such Notes to be allocated to the Series 2007-CC Collateral Certificate and (y) any amounts
required to be retained in any reserve account or subaccount for the Note Issuance Trust in
connection with such issuance of Notes, multiplied by the percentage
21
of the Nominal Liquidation Amount of such Notes to be allocated to the Series 2007-CC Collateral Certificate;
(c) Discover Bank, as Holder of the Seller Certificate, shall have notified the Trustee, in
writing, at least one business day in advance of the date upon which the Series Investor Interest
is to be increased, which notice shall state the amount of such increase in the Series Investor
Interest;
(d) The Sellers shall have delivered to the Trustee written confirmation from the Rating
Agencies that they will not, as a result of the increase, change the rating of any Class of any
Series outstanding at the time of the increase; and
(e) Discover Bank, on behalf of the holder of the Seller Certificate, shall not be required to
designate Additional Accounts or convey a Participation interest to the Trust pursuant to Section
2.10(a) of the Pooling and Servicing Agreement as a result of such increase.
Upon any increase in the Series Investor Interest the Trustee shall make appropriate entries
in the certificate registrar for the Series 2007-CC Collateral Certificate in the amount of the
increase.
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IN WITNESS WHEREOF, the Seller, the Master Servicer, the Servicer and the Trustee have caused this
Series Supplement to be duly executed by their respective officers thereunto duly authorized as of
the date and year first above written.
DISCOVER BANK, | ||||||
as Seller, Master Servicer and Servicer | ||||||
Xxxxxxx X. Xxxxxxx | ||||||
Vice President, Chief Financial Officer and | ||||||
Treasurer | ||||||
U.S. BANK NATIONAL ASSOCIATION, | ||||||
as Trustee | ||||||
Xxxxxxxx X. Child | ||||||
Vice President |
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EXHIBIT A
Form of Series 2007-CC Investor Certificate
EXHIBIT B
Form of Investor Certificateholders’ Monthly Statement
Series 2007-CC Monthly Statement