ITEM 14
EXHIBIT 10.10
EXECUTION COPY
================================================================================
XXXXXXXXXX TRADE RECEIVABLES MASTER TRUST
POOLING AND SERVICING AGREEMENT
Dated as of August 23, 1996
Among
XXXXXXXXXX FINANCIAL CORPORATION,
as Transferor
X. XXXXXXXXXX & CO., INC.,
as Servicer
and
BANKERS TRUST COMPANY,
as Trustee
================================================================================
Pooling and Servicing Agreement
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions........................................... 1
SECTION 1.02. Other Definitional Provisions......................... 25
ARTICLE II
TRANSFER OF RECEIVABLES
SECTION 2.01. Transfer of Receivables............................... 25
SECTION 2.02. Acceptance by Trustee................................. 27
SECTION 2.03. Representations and Warranties of the Transferor
Relating to the Transferor.......................... 27
SECTION 2.04. Representations and Warranties of the Transferor
Relating to the Trust Assets........................ 32
SECTION 2.05. Affirmative Covenants of the Transferor............... 36
SECTION 2.06. Negative Covenants of the Transferor.................. 40
SECTION 2.07. Addition and Removal of Originators................... 44
ARTICLE III
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 3.01. Acceptance of Appointment and Other Matters
Relating to the Servicer............................ 45
SECTION 3.02. Servicing Compensation; Servicer's Expenses........... 47
SECTION 3.03. Representations and Warranties of the Servicer........ 48
SECTION 3.04. Covenants of the Servicer............................. 50
SECTION 3.05. Reports and Records for the Trustee................... 56
SECTION 3.06. Annual Certificate of Servicer........................ 56
SECTION 3.07. Semi-Annual Servicing Report of Independent Public
Accountants......................................... 56
SECTION 3.08. Tax Treatment......................................... 56
SECTION 3.09. Notices to Xxxxxxxxxx................................. 57
SECTION 3.10. Adjustments........................................... 57
SECTION 3.11. Securities and Exchange Commission Filings............ 57
Pooling and Servicing Agreement
(ii)
ARTICLE IV
RIGHTS OF CERTIFICATEHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION 4.01. Rights of Certificateholders.......................... 57
SECTION 4.02. Establishment of Concentration Account and
Xxxxxxxxxx Collection Accounts...................... 58
SECTION 4.03. Allocation of Collections............................. 61
ARTICLE V
DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS
SECTION 5.01. Distributions and Reports to Certificateholders....... 61
ARTICLE VI
THE CERTIFICATES
SECTION 6.01. The Certificates...................................... 61
SECTION 6.02. Authentication of Certificates........................ 62
SECTION 6.03. Registration of Transfer and Exchange of Certificates. 62
SECTION 6.04. Mutilated, Destroyed, Lost or Stolen Certificates..... 64
SECTION 6.05. Persons Deemed Owners................................. 64
SECTION 6.06. Access to List of Certificateholders' Names and
Addresses........................................... 65
SECTION 6.07. Authenticating Agent.................................. 65
SECTION 6.08. New Issuances......................................... 66
ARTICLE VII
OTHER MATTERS RELATING TO THE TRANSFEROR
SECTION 7.01. Obligations Not Assignable............................ 69
SECTION 7.02. Limitations on Liability.............................. 69
SECTION 7.03. Indemnification of the Trustee, the Certificateholders,
the Program Agent and the Enhancement Provider...... 69
Pooling and Servicing Agreement
(iii)
ARTICLE VIII
OTHER MATTERS RELATING TO THE SERVICER
SECTION 8.01. Liability of the Servicer............................. 72
SECTION 8.02. Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer........................ 72
SECTION 8.03. Limitations on Liability.............................. 73
SECTION 8.04. Servicer Indemnification.............................. 73
SECTION 8.05. The Servicer Not to Resign............................ 75
SECTION 8.06. Examination of Records................................ 76
SECTION 8.07. Confidentiality....................................... 76
ARTICLE IX
TRUST EARLY AMORTIZATION EVENTS
SECTION 9.01. Trust Early Amortization Events....................... 76
SECTION 9.02. Additional Rights upon the Occurrence of Any Trust
Early Amortization Event............................ 79
ARTICLE X
SERVICER DEFAULTS
SECTION 10.01. Servicer Defaults.................................... 80
SECTION 10.02. Trustee to Act; Appointment of Successor Servicer.... 83
SECTION 10.03. Notification to Certificateholders................... 85
ARTICLE XI
THE TRUSTEE
SECTION 11.01. Duties of the Trustee................................ 85
SECTION 11.02. Certain Matters Affecting the Trustee................ 88
SECTION 11.03. Trustee Not Liable for Recitals in Certificates or
Receivables........................................ 89
SECTION 11.04. Trustee May Own Certificates......................... 89
SECTION 11.05. Compensation; Trustee's Expenses..................... 90
SECTION 11.06. Eligibility Requirements for Trustee................. 90
SECTION 11.07. Resignation or Removal of Trustee.................... 91
SECTION 11.08. Successor Trustee.................................... 92
Pooling and Servicing Agreement
(iv)
SECTION 11.09. Merger or Consolidation of Trustee................... 92
SECTION 11.10. Appointment of Co-Trustee or Separate Trustee........ 92
SECTION 11.11. Tax Returns.......................................... 93
SECTION 11.12. Trustee May Enforce Claims Without Possession of
Certificates....................................... 94
SECTION 11.13. Suits for Enforcement................................ 94
SECTION 11.14. Rights of Certificateholders to Direct Trustee....... 95
SECTION 11.15. Representations and Warranties of Trustee............ 95
SECTION 11.16. Maintenance of Office or Agency...................... 95
ARTICLE XII
TERMINATION
SECTION 12.01. Termination of Trust................................. 96
SECTION 12.02. Final Distribution................................... 96
SECTION 12.03. Transferor's Termination Rights...................... 97
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.01. Amendment............................................ 97
SECTION 13.02. Protection of Right, Title and Interest to Trust..... 99
SECTION 13.03. Limitation on Rights of Certificateholders........... 100
SECTION 13.04. Notices; Payments.................................... 101
SECTION 13.05. Rule 144A Information................................ 102
SECTION 13.06. Severability of Provisions........................... 103
SECTION 13.07. Assignment........................................... 103
SECTION 13.08. Certificates Nonassessable and Fully Paid............ 103
SECTION 13.09. Further Assurances................................... 103
SECTION 13.10. Nonpetition Covenant................................. 103
SECTION 13.11. No Waiver; Cumulative Remedies....................... 104
SECTION 13.12. Counterparts......................................... 104
SECTION 13.13. Third-Party Beneficiaries............................ 104
SECTION 13.14. Actions by Certificateholders........................ 104
SECTION 13.15. Merger and Integration............................... 104
SECTION 13.16. Headings............................................. 105
SECTION 13.17. Construction of Agreement............................ 105
SECTION 13.18. Governing Law; Jurisdiction; Consent to Service of
Process............................................ 105
Pooling and Servicing Agreement
(v)
EXHIBITS
Exhibit A Form of Transferor Certificate
Exhibit B Form of Annual Servicer's Certificate
Exhibit C-1 Form of CoreStates Collection Account Letter
Exhibit C-2 Form of Hong Kong and Singapore Collection Account Letter
Exhibit D Form of Rule 144A and Non-Rule 144A Letters
Exhibit E Form of Daily Report
Exhibit F Xxxxxxxxxx Credit Policy Manual
Exhibit G Form of Annual Servicing Report of Independent Public Accountants
Pooling and Servicing Agreement
1
POOLING AND SERVICING AGREEMENT, dated as of August 23, 1996, among
XXXXXXXXXX FINANCIAL CORPORATION, as Transferor, X. XXXXXXXXXX & CO., INC., as
Servicer, and BANKERS TRUST COMPANY, as Trustee.
In consideration of the mutual agreements herein contained, each
party agrees as follows for the benefit of the other parties, the
Certificateholders and the Enhancement Provider to the extent provided herein:
ARTICLE I
DEFINITIONS
SECTION 1.01. Definitions. Whenever used in this Agreement, the
following words and phrases shall have the following meanings, and the
definitions of such terms are applicable to the singular as well as the plural
forms of such terms and to the masculine as well as to the feminine and neuter
genders of such terms. Capitalized terms not otherwise defined in this Agreement
have the same meanings as specified in the related Supplement.
"Accommodation Obligation" means any contractual obligation,
contingent or otherwise, of one Person with respect to any Indebtedness of
another, if the primary purpose or intent thereof by the Person incurring the
Accommodation Obligation is to provide assurance to the obligee of such
Indebtedness of another that such Indebtedness will be paid or discharged, or
that any agreements relating thereto will be complied with, or that the holders
thereof will be protected (in whole or in part) against loss in respect thereof
including, without limitation, direct and indirect guarantees, endorsements
(except for collection or deposit in the ordinary course of business), notes
co-made or discounted, recourse agreements, take-or-pay agreements, keep-well
agreements, agreements to purchase or repurchase such Indebtedness or any
security thereof or to provide funds for the payment or discharge thereof,
agreements to maintain solvency, assets, level of income, or other financial
condition, and agreements to make payment other than for value received. The
amount of any Accommodation Obligation shall be equal to the lesser of (i) the
principal amount payable under such Accommodation Obligation (if quantifiable),
and (ii) the portion of the obligation so guaranteed or otherwise supported.
"Act" shall mean the Securities Act of 1933, as amended from time to
time.
"Additional Originator" shall have the meaning specified in Section
2.07(a).
"Affiliate" shall mean, with respect to any specified Person, any
other Person controlling, controlled by or under common control with such
specified Person and, without limiting the generality of the foregoing, shall be
presumed to include (A) any Person which
Pooling and Servicing Agreement
2
beneficially owns or holds 12.5% or more of any class of voting securities
(after giving effect to any capital stock which is convertible into voting
stock) of such designated Person or 12.5% or more of the equity interest in such
designated Person and (B) any Person of which such designated Person
beneficially owns or holds 12.5% or more of any class of voting securities
(after giving effect to any capital stock which is convertible into voting
stock). For the purposes of this definition, (i) "control" when used with
respect to any specified Person shall mean the power to direct the management
and policies of such specified Person, directly or indirectly, whether through
the ownership of voting securities, by contract or otherwise; and the terms
"controlling" and "controlled" have meanings correlative to the foregoing and
(ii) Mobil Corporation shall not be deemed an Affiliate of Xxxxxxxxxx solely as
a result of its ownership interest in the Series A Preferred Stock, par value
$0.01 per share, issued by Xxxxxxxxxx Holding Corporation, a Delaware
corporation, but only so long as Mobil Corporation has no representative on the
board of directors of Xxxxxxxxxx Holding Corporation.
"Aggregate Certificateholders' Interest" shall have the meaning
specified in Section 4.01(a).
"Aggregate Non-Investment Grade/Non-Rated Country Receivables
Balance Concentration Limit" shall mean, on any date, 40% or such different
percentage as shall be selected by the Transferor upon satisfaction of the
Rating Agency Condition.
"Agreement" shall mean this Pooling and Servicing Agreement, as the
same may from time to time be amended, modified or otherwise supplemented,
including, with respect to any Series, the related Supplement.
"Amortization Date" shall mean, with respect to any Series, the
amortization date specified in the related Supplement.
"Amortization Period" shall mean, with respect to any Series, unless
otherwise specified in the related Supplement, the period beginning on the
related Amortization Date and ending upon the payment in full to the Investor
Certificateholders of such Series of the Invested Amount with respect to such
Series, all accrued and unpaid interest thereon and all other amounts owed to
the Investor Certificateholders hereunder.
"Beneficiary" shall mean, as of any date of determination, any of
the Trustee, the then holders of the Investor Certificates and any Enhancement
Provider.
"Benefit Plan" means a defined benefit plan as defined in Section
3(35) of ERISA (other than a Multiemployer Plan) in respect of which the
Transferor or any ERISA Affiliate is, or within the immediately preceding six
(6) years was, an "employer" as defined in Section 3(5) of ERISA.
Pooling and Servicing Agreement
3
"Business Day" shall mean any day other than (a) a Saturday or
Sunday or any other day on which national banking associations or state banking
institutions in New York, New York or the city in which the Corporate Trust
Office is located are authorized or obligated by law, executive order or
governmental decree to be closed and (b) with respect to non-financial reporting
requirements of the Servicer or the Transferor, any day on which the Servicer or
the Transferor is closed and (c) if during any applicable interest period an
interest rate or certificate rate is calculated by reference to a eurodollar
rate, a day on which dealings in deposits in United States dollars are not
customarily transacted in the London interbank market and (d) any other day
specified in a Supplement as a "Business Day".
"Certificate" shall mean any one of the Investor Certificates or the
Transferor Certificate.
"Certificate Rate" shall mean, with respect to any Series, the
certificate rate specified therefor in the related Supplement.
"Certificate Register" shall have the meaning specified in Section
6.03(a).
"Certificateholder" or "Holder" shall mean an Investor
Certificateholder or the Person in whose name the Transferor Certificate is
registered in the Certificate Register.
"Certificateholders' Interest" shall have the meaning specified in
Section 4.01(a).
"Collection Period" shall mean, with respect to any Distribution
Date, the calendar month (or, in the case of the calendar month in which the
Closing Date occurs, the portion of such calendar month following the Closing
Date) immediately preceding the calendar month in which such Distribution Date
occurs.
"Collections" shall mean (a) all cash payments by or on behalf of
the Obligors deposited to any Xxxxxxxxxx Collection Account or the Concentration
Account, or received by the Servicer, in respect of Receivables in the form of
cash, checks, wire transfers, electronic transfers or any other form of cash
payment and (b) all interest and other investment earnings (net of losses and
investment expenses) on Collections (including, without limitation, funds on
deposit in the Cure Accounts) as a result of the investment thereof pursuant to
Section 4.02(a).
"Concentration Account" shall have the meaning specified in Section
4.02(a).
"Concentration Account Bank" shall initially be Bankers Trust
Company, and shall have the meaning specified in Section 4.02(a).
Pooling and Servicing Agreement
4
"Confidential Information" shall mean any written information
delivered or made available by or on behalf of Xxxxxxxxxx (or its Affiliates or
subsidiaries), the Servicer, the Transferor or Xxxxxxxxxx International to any
Person in connection with or pursuant to this Agreement or the transactions
contemplated hereby which is proprietary in nature and clearly marked or
identified in writing as being confidential information, other than information
(i) which was publicly known, or otherwise known to such Person, at the time of
disclosure or (ii) which subsequently becomes publicly known through no act or
omission by such Person.
"Consolidated Tangible Net Worth" means, with respect to any Person,
at any time, (i) total consolidated assets of such Person (including the
capitalized portion of any interest rate exchange, swap, collar, future,
protection, cap, floor or similar agreement providing interest rate protection),
plus (ii) any negative cumulative foreign exchange translation adjustments
applicable to such Person, minus (iii) total consolidated liabilities of such
Person (excluding any accrued and unpaid dividends payable on the capital stock
of such Person (regardless of class or designation) and all warrants, options,
purchase rights, conversion or exchange rights, voting rights, calls or claims
of any character with respect thereto), minus (iv) any positive cumulative
foreign exchange translation adjustments applicable to such Person. There shall
be excluded therefrom all general intangibles (as defined in Section 9-106 of
the UCC or in any similar statute of Canada, the United Kingdom or any other
relevant jurisdiction, or any political subdivision thereof) (except goodwill,
tax refunds, tax refund claims, rights and claims against carriers, shippers,
franchises, lessors and lessees, and rights to indemnification), organizational
expenses and all unamortized debt discount and deferred charges (including
deferred taxes) and non-current pension liabilities or assets. Assets and
liabilities shall be determined in accordance with generally accepted accounting
principles, except that investments in and moneys due from Affiliates of the
Transferor (other than such moneys in respect of trade accounts receivables and
payables in the ordinary course of business) shall be excluded from total
consolidated assets.
"Contract" shall mean an agreement between an Originator and an
Obligor, containing terms pursuant to or under which such Obligor shall be
obligated to pay from time to time for merchandise delivered or to be delivered
or services performed or to be performed.
"Controlled Affiliate" shall mean any specified Person controlled by
or under common control with Xxxxxxxxxx, the Servicer or the Transferor or as to
which Xxxxxxxxxx, the Servicer or the Transferor beneficially owns or holds 50%
or more of any class of securities of such Person the holders of which are
ordinarily entitled to vote for the election of directors of such Person or 50%
or more of the equity interest in such Person. For the purposes of this
definition, "control" when used with respect to any specified Person shall mean
the power to direct the management and policies of such specified Person,
directly or indirectly, whether through the ownership of voting securities, by
contract or otherwise; and the terms "controlling" and "controlled" have
meanings correlative to the foregoing.
Pooling and Servicing Agreement
5
"Corporate Trust Office" shall have the meaning specified in Section
11.16.
"Country Concentration Limit" shall mean, on any date with respect
to any country the percentage set forth below opposite the category of Public
Debt Rating applicable to such country (including "Non-Rated" as a Public Debt
Rating") or such different percentage as shall be selected by the Transferor;
provided that the Rating Agency Condition shall have first been satisfied with
respect to such different percentage:
S&P Moody's Percentages
--- ------- -----------
AA or higher Aa2 or higher No Limit
A to AA- A2 to Aa3 7.0%
BBB- to A- Baa3 to A3 5.5%
Non-Investment Grade/Non-Rated Countries
6 Largest Countries (measured by Outstanding
Balance of Receivables) 4.0%
All Other Countries 1.5%
"Country Receivable" means, with respect to any country, Receivables
owed by Obligors who are domiciled in such country.
"Credit Agreement" means the Credit Agreement dated February 9, 1996
among X. Xxxxxxxxxx & Co., Inc., Xxxxxxxxxx Holding Corporation, Xxxxxxxxxx
International, Ltd., Pegasus Polymers International Inc., and X. Xxxxxxxxxx and
Co. (Canada) Limited, the lenders named therein or from time to time parties
thereto, the issuing banks named therein from time to time parties thereto and
Citicorp USA, Inc., as agent, and Citibank, Canada, as Canadian agent, as
amended, supplemented, modified, restated, replaced or refinanced from time to
time.
"Cure Account" with respect to any Series shall have the meaning
specified in the related Supplement, and "Cure Accounts" shall refer to all the
Cure Accounts established for outstanding Series in accordance with the terms of
the related Supplements.
"Cure Funds" shall mean Collections which, from time to time, are
deposited by the Transferor into a Cure Account.
Pooling and Servicing Agreement
6
"Cure Period" shall mean, if the Transferor has elected to begin
depositing Cure Funds into the Cure Accounts, the period beginning on and
including a Pool Non-compliance Date and ending on but excluding the earlier of
(a) the first date thereafter on which the Net Receivables Balance equals or
exceeds the Required Net Receivables Balance and (b) the fifth consecutive
Business Day following the occurrence of such Pool Non-compliance Date.
"Daily Report" shall mean an Officer's Certificate of the Servicer
substantially in the form of Exhibit E hereto.
"Defaulted Receivable" shall mean a Receivable (i) as to which an
Insolvency Event has occurred with respect to the Obligor thereof, (ii) as to
which any payment, or part thereof, remains unpaid by the Obligor thereof for 91
days or more from the original due date for such payment specified in the
relevant invoice or (iii) which, consistent with the Xxxxxxxxxx Credit Policy
Manual, would be or has been written off as uncollectible.
"Deposit Date" shall mean each Business Day on which any Collections
are deposited in the Concentration Account.
"Determination Date" shall mean, with respect to any Distribution
Date, the fourth Business Day preceding such Distribution Date.
"Determination Date Certificate" shall mean, with respect to any
Determination Date and any Series, a report prepared by an officer of the
Servicer for such Determination Date as of the end of the most recently
completed calendar month, substantially in the form set forth in the related
Supplement.
"Diluted Receivable" shall mean that portion of any Receivable which
is either (a) reduced or cancelled as a result of (i) any failure by any
Originator to deliver any merchandise or provide any services or otherwise to
perform under the underlying Contract or invoice, (ii) any change in the terms
of, or cancellation of, a Contract or invoice or any other adjustment by the
Servicer which reduces the amount payable by the Obligor on the related
Receivable, (iii) a check or other similar instrument issued by the Originator
to the Obligor as a discount or rebate on the underlying Contract or invoice or
(iv) any set-off by an Obligor in respect of any claim by such Obligor as to
amounts owed by it on the related Receivable or (b) subject to any dispute,
offset, counterclaim or defense whatsoever asserted (except the discharge in
bankruptcy of the Obligor thereof); provided that Diluted Receivables are
calculated assuming that all chargebacks are resolved in the Obligor's favor and
do not include contractual adjustments to the amount payable by an Obligor that
are eliminated from the Receivables balance sold to the Trust through a
reduction in the Purchase Price for the related Receivable.
"Discount Amount" shall mean, with respect to any Series, the amount
set forth
Pooling and Servicing Agreement
7
in the related Supplement.
"Distribution Date" shall mean, with respect to any Collection
Period, the fifteenth day of the calendar month immediately following such
Collection Period, or, if such day is not a Business Day, the next succeeding
Business Day or such other day as set forth in the Supplement for any Series.
"DOL" means the United States Department of Labor and any Person
succeeding to the functions thereof.
"Early Amortization Period" shall mean, with respect to any Series,
unless otherwise specified in the related Supplement, the period beginning at
the close of business on the Business Day immediately preceding the day on which
an Early Amortization Event is deemed to have occurred, and ending upon the
Termination Date with respect to such Series.
"Eligible Institution" shall mean a depository institution organized
under the laws of the United States of America or any state thereof, or the
District of Columbia (or any domestic branch of a foreign bank authorized under
any such laws), (a) whose long-term unsecured debt obligations are rated at
least (i) if S&P is a Rating Agency, A- or better, and (ii) if Xxxxx'x is a
Rating Agency, A3 or better, and (b) which is subject to regulation regarding
fiduciary funds on deposit substantially similar to 12 C.F.R. Section 9.10(b)
and (c) which has a combined capital and surplus of at least $500,000,000.
"Eligible Investments" shall mean book-entry securities entered on
the books of the registrar of such securities and held in the name or on behalf
of the Trustee, negotiable instruments or securities represented by instruments
in bearer or registered form (registered in the name of the Trustee or its
nominee) which evidence:
(a) direct obligations of, or obligations fully guaranteed as to
timely payment by, the United States of America or any agency thereof;
(b) demand deposits, time deposits or certificates of deposit
(having original maturities which mature no later than the Business Day
prior to the next Distribution Date) of depository institutions or trust
companies incorporated under the laws of the United States of America or
any state thereof (or domestic branches of foreign banks), subject to
supervision and examination by federal or state banking or depository
institution authorities, and having, at the time of the Trust's investment
or contractual commitment to invest therein, the highest short-term
unsecured debt rating from each Rating Agency;
(c) commercial paper (having original maturities of no more than 270
days) having, at the time of the Trust's investment or contractual
commitment to invest
Pooling and Servicing Agreement
8
therein, the highest short-term rating from each Rating Agency;
(d) investments in no-load money market funds having a rating from
each Rating Agency rating such fund in its highest investment category
(including such funds for which the Trustee or any of its Affiliates is
investment manager or advisor); or
(e) notes or bankers' acceptances (having original maturities of no
more than 270 days) issued by any depository institution or trust company
described in clause (b) above.
"Eligible Receivable" shall mean, at any time, unless otherwise
specified, each Receivable or portion thereof, satisfying the following
criteria:
(a) as to which, at the time of the Transfer of such Receivable to
the Trust, the Transferor or the Trust will have good and marketable title
thereto free and clear from any and all Liens except as created hereunder,
and which has been the subject of either a valid transfer and assignment
from the Transferor to the Trust of all the Transferor's right, title and
interest therein (and in the proceeds thereof), or the grant of a first
priority perfected "security interest" (within the meaning of the UCC of
the State of New York and of the jurisdiction the law of which governs the
perfection of the interest in such Receivable created hereunder) therein
(and in the proceeds thereof);
(b) which is not a Defaulted Receivable or a Diluted Receivable;
(c) which arose in the ordinary course of business of any Originator
and is an account receivable representing all or part of the sales price
of merchandise or services within the meaning of Section 3(c)(5) of the
Investment Company Act, the Obligor of which is primarily liable with
respect thereto;
(d) which is an "account" (within the meaning of Section 9-106 of
the UCC of the State of New York and of the jurisdiction the law of which
governs the perfection of the interest in such Receivable created
hereunder);
(e) which is denominated and payable only in United States dollars.
(f) which will at all times be the legal and assignable payment
obligation of the Obligor of such Receivable, enforceable against such
Obligor in accordance with its terms except as such enforceability may be
limited by applicable bankruptcy, reorganization, insolvency, moratorium
or other laws affecting creditors' rights generally, and except as such
enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity);
Pooling and Servicing Agreement
9
(g) which was created in compliance with, and which, at the time of
the Transfer of such Receivable to the Trust, does not contravene any
applicable Requirement of Law, and the Obligor of which is not in
violation of any such Requirement of Law with respect to such Receivable;
(h) which satisfies all applicable requirements of the Muehlstein
Credit Policy Manual;
(i) with respect to which all 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 have been duly obtained, effected or given
and are in full force and effect;
(j) which is not subject to any specific waiver or modification
except for a Receivable which is subject to a waiver or modification as
permitted in accordance with the Muehlstein Credit Policy Manual and which
waiver or modification is reflected in the Servicer's records and computer
files relating thereto;
(k) which is not subject to any provision prohibiting the transfer
or assignment by any Originator of such payment obligation;
(l) the payment terms of which do not exceed 120 days after the
invoice date and otherwise conform to the provisions of the Muehlstein
Credit Policy Manual;
(m) the Obligor of which is not a Controlled Affiliate of
Muehlstein, the Servicer or the Transferor;
(n) the Obligor of which is not a Governmental Authority;
(o) the Obligor of which is not a supplier to, or creditor of, any
Originator; provided that Receivables of which the Obligor is a supplier
to, or creditor of, any Originator shall be "Eligible Receivables" to the
extent that the aggregate Outstanding Balance of such Receivables exceeds
the maximum amount of such Obligor's right of set-off in respect thereof;
(p) the Obligor of which has been directed to remit payments with
respect thereto to a Muehlstein Post Office Box or a Muehlstein Collection
Account;
(q) the Obligor of which has no more than 10% of all its Receivables
91 days or more past their respective due dates;
(r) the Obligor of which is not domiciled in a country (other than
the United
Pooling and Servicing Agreement
10
States of America) (i) which has more than 20% of its Country Receivables
91 days or more past their respective due dates, calculated in each case
after giving effect to the Receivables of such Obligor or (ii) a national
Governmental Authority of which has failed to pay when due any
Indebtedness in an aggregate principal amount in excess of $50 million (or
the equivalent in any other currency) payable in a currency other than the
currency of such country to a Person resident or having a head office or
chief place of business outside the territory of such country, or (iii)
whose government or central bank shall have prohibited the sale of the
currency of such country in exchange for United States dollars or shall
have admitted in writing its inability to pay its debts as the same become
due or shall have declared a moratorium on the payment of its debts or the
debts of any national Governmental Authority of such country or shall have
ceased to be a member of the International Monetary Fund or ceased to be
eligible to use the resources of the International Monetary Fund;
(s) the Obligor of which is not domiciled in Cuba, Libya, North
Korea, Iran, Iraq, Angola or any other country with respect to which the
United States shall have imposed Category I economic sanctions (i.e. under
31 C.F.R. ss. 500.201) under 31 C.F.R. 500 dealing with Foreign Assets
Control Regulations; and
(t) the Obligor of which is not domiciled in a country in Latin
America that is a Non-Investment Grade/Non-Rated Country if at such time
either (i) the aggregate Outstanding Balance of all Receivables which are
91 days or more past due of Obligors domiciled in all countries in Latin
America exceeds 12% of the aggregate Outstanding Balance of all
Receivables of all Obligors domiciled in all countries in Latin America
(other than any country in Latin America described in subclause (r)
above), or (ii) with respect the countries of the Federative Republic of
Brazil, the United Mexican States and the Republic of Argentina, all three
shall concurrently experience one of the following events: (A) a national
Governmental Authority of such country shall have failed to pay when due
any Indebtedness in an aggregate principal amount in excess of $50 million
(or the equivalent in any other currency) payable in a currency other than
the currency of such country to a Person resident or having a head office
or chief place of business outside the territory of such country, or (B)
the national government or central bank of such country (1) shall have
prohibited the sale of the currency of such country in exchange for United
States dollars or (2) shall have admitted in writing its inability to pay
its debts as the same become due or (3) shall have declared a moratorium
on the payment of its debts or the debts of any national Governmental
Authority of such country or (4) shall have ceased to be a member of the
International Monetary Fund or ceased to be eligible to use the resources
of the International Monetary Fund.
"Eligible Servicer" shall mean Muehlstein, Citibank, N.A., the
Trustee or another entity which, at the time of its appointment as Servicer, (a)
is servicing a portfolio of
Pooling and Servicing Agreement
11
trade receivables and has demonstrated the ability to service professionally and
competently a portfolio of similar trade receivables with reasonable standards
of skill and care, (b) is legally qualified and has the capacity to service the
Receivables and (c) has been approved by the Enhancement Provider.
"Enhancement" shall mean, with respect to any Series, any letter of
credit, surety bond, cash collateral account, spread account, guaranteed rate
agreement, maturity liquidity facility, tax protection agreement, interest rate
swap agreement or other similar arrangement for the benefit of the
Certificateholders of such Series.
"Enhancement Agreement" shall mean any agreement, instrument or
document governing the terms of any Enhancement of any Series or pursuant to
which any Enhancement of any Series is issued or outstanding.
"Enhancement Provider" shall mean, for any Series, the Person
identified as such in the applicable Supplement.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended from time to time, any successor statute, and the regulations
promulgated and rulings issued thereunder.
"ERISA Affiliate" means (i) any corporation which is a member of the
same controlled group of corporations (within the meaning of Section 414(b) of
the Internal Revenue Code) as the Transferor; (ii) a partnership or other trade
or business (whether or not incorporated) which is under common control (within
the meaning of Section 414(c) of the Internal Revenue Code) with the Transferor;
(iii) a member of the same affiliated service group (within the meaning of
Section 414(m) of the Internal Revenue Code) as the Transferor, any corporation
described in clause (i) above or any partnership or trade or business described
in clause (ii) above; and (iv) any other Person which is required to be
aggregated with the Transferor pursuant to regulations promulgated under Section
414(o) of the Internal Revenue Code.
"Expected Final Payment Date" with respect to any Series, shall have
the meaning specified in the related Supplement.
"Fee Letter" shall mean, for each Series, that certain letter
entered into by the Transferor and the Program Agent dated the date of the
certificate purchase agreement with respect to such Series, as such letter may
be modified from time to time in accordance with the terms thereof.
"Financial Officer" means, with respect to the Transferor, the chief
financial officer, treasurer, controller or other officer or member of
management of the Transferor with
Pooling and Servicing Agreement
12
significant responsibility for the financial affairs of the Transferor.
"Floating Allocation Percentage" shall mean, with respect to each
Series, the floating allocation percentage specified in the related Supplement;
provided, however, that the aggregate of the Floating Allocation Percentages
with respect to all outstanding Series shall not exceed 100%.
"GAAP" shall mean United States generally accepted accounting
principles.
"Government Receivable" shall mean a Receivable with respect to
which the Obligor is a Governmental Authority.
"Governmental Authority" shall mean any country or nation, any
political subdivision, state or municipality of such country or nation, and any
entity exercising executive, legislative, judicial, regulatory or administrative
functions of any country or nation or political subdivision thereof.
"Indebtedness" shall mean, as applied to any Person, at any time,
without duplication, (a) all indebtedness, obligations or other liabilities of
such Person (i) for borrowed money or evidenced by debt securities, debentures,
acceptances, notes or other similar instruments, together with, in each case,any
accrued interest, fees and charges relating thereto, (ii) in respect of
obligations (A) to redeem, repurchase or exchange for cash any Securities at a
fixed or determinable date, at the option of another Person or upon the
occurrence of a condition not solely within the control of such Person, as of
the time such payment date becomes fixed or determined, such option is exercised
or such condition is satisfied, as the case may be, or (B) to pay cash dividends
in respect of any stock, (iii) with respect to letters of credit issued for such
Person's account, (iv) to pay the deferred purchase price of property or
services, except (A) accounts payable and accrued expenses arising in the
ordinary course of business and (B) any obligation arising solely in respect of
the conversion in the ordinary course of business of any current liability into
a long-term obligation in a like amount and bearing interest at a rate not in
excess of a market rate of interest, (v) in respect of the lease of any property
(whether real, personal or mixed) by such Person as lessee which, in conformity
with GAAP, is accounted for as a capital lease on the balance sheet of such
Person, (vi) which are Accommodation Obligations, (vii) upon which interest
charges are customarily paid (including zero coupon instruments but excluding
obligations referred to in clauses (iv)(A) or (iv)(B) above) or (viii) under
conditional sale or other title retention agreements relating to property
purchased by such Person; (b) all indebtedness, obligations or other liabilities
of such Person secured by a Lien on any property of such Person, whether or not
such indebtedness, obligations or liabilities are assumed by such Person, all as
of such time (it being understood that if recourse with respect to such
indebtedness, obligations or liabilities is limited to such property, such
indebtedness, obligations or other liabilities shall be limited to the fair
market value of such property); (c) all indebtedness, obligations or other
liabilities of such Person in
Pooling and Servicing Agreement
13
respect of interest rate exchange, swap, collar, future, protection, cap, floor
or similar agreements providing interest rate protection and any foreign
exchange contract, currency swap agreement or other similar agreement or
arrangement, net of liabilities owed to such Person by the counterparties
thereon; and (d) all contingent contractual obligations with respect to any of
the foregoing.
"Indemnified Amounts" shall have the meaning specified in Section
7.03.
"Indemnified Party" shall have the meaning specified in Section
7.03.
"Independent Public Accountants" means any of (a) Xxxxxx Xxxxxxxx &
Co., (b) Deloitte & Touche LLP, (c) Coopers & Xxxxxxx, (d) Ernst & Young, (e)
KPMG Peat Marwick and (f) Price Waterhouse or any of their respective successors
so long as such successor is one of the six largest United States accounting
firms; provided that such firm is independent with respect to the Servicer
within the meaning of the Act.
"Initial Invested Amount" shall mean, with respect to any Series and
for any date, an amount equal to the initial invested amount specified in the
related Supplement.
"Initial Issuance Date" shall mean, with respect to any Series, the
"Closing Date" specified in the related Supplement.
"Insolvency Event" shall mean, with respect to a specified Person,
(a) the commencement of a case in respect of such Person or any substantial part
of its property under any applicable bankruptcy, insolvency or other similar law
now or hereafter in effect, or the filing of a decree or order by a court having
jurisdiction in the premises appointing a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official for such Person or for all
or any substantial part of its property, or the ordering of the winding-up or
liquidation of such Person's business, and such case, decree or order shall
remain unstayed and in effect for a period of 60 consecutive days, or the filing
of a decree or order for relief by a court having jurisdiction in the premises
in respect of such Person or any substantial part of its property in an
involuntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect; or (b) the commencement by such Person or by a
Controlled Affiliate of such Person (provided that in the case of Muehlstein or
any of its Affiliates, such Controlled Affiliate is domiciled in the United
States and has assets which constitute 2.5% or more of the assets of Muehlstein,
or is Pegasus Polymers International Inc., Polymers International Financial
Corporation, the Transferor or an Originator) of a voluntary case under any
applicable bankruptcy, insolvency or other similar law now or hereafter in
effect, or the consent by such Person to the entry of an order for relief in an
involuntary case under any such law, or the consent by such Person to the
appointment of or taking possession by a receiver, liquidator, assignee for the
benefit of creditors, custodian, trustee, sequestrator or similar official for
such Person or for all or any substantial part of its property, or the making by
such
Pooling and Servicing Agreement
14
Person of any general assignment for the benefit of creditors; or (c) the
failure by such Person generally to pay its debts as such debts become due or
the admission by such Person in writing (as to which the Trustee shall have
written notice) of its inability to pay its debts generally as they become due.
"Intercreditor Agreement" shall mean the agreement among Citicorp
North America, Inc., the Transferor, Muehlstein, Xxxxxxxxxx International, Ltd.,
the Trustee, Citicorp USA, Inc., Citibank Canada, AMBAC Indemnity Corporation
and FINOVA Capital Corporation, dated as of the date hereof, as the same may
from time to time be amended, modified or otherwise supplemented.
"Internal Revenue Code" shall mean the Internal Revenue Code of
1986, as amended from time to time.
"Invested Amount" shall mean, with respect to any Series and for any
date, an amount equal to the invested amount specified in the related
Supplement.
"Investment Company Act" shall mean the Investment Company Act of
1940, as amended from time to time.
"Investor Certificate" shall mean any one of the certificates
executed by the Transferor and authenticated by or on behalf of the Trustee, in
substantially the form attached to the related Supplement, other than the
Transferor Certificate.
"Investor Certificateholder" shall mean the Person in whose name an
Investor Certificate is registered in the Certificate Register.
"Investor Collections" shall mean, with respect to each Series,
investor collections for such Series specified in the related Supplement.
"IRS" means the Internal Revenue Service and any Person succeeding
to the functions thereof.
"Knowledge" (and the related term "Know") means, with respect to the
Transferor's knowledge, the knowledge of a Responsible Officer of the
Transferor.
"Latin America" shall mean all of Xxxxx Xxxxxxx, Xxxxxxx Xxxxxxx xxx
Xxxxx Xxxxxxx except for the United States of America and Canada.
"Lien" shall mean any mortgage, deed of trust, pledge,
hypothecation, assignment, encumbrance, lien (statutory or other), preference,
participation interest, priority or other security agreement or preferential
arrangement of any kind or nature whatsoever
Pooling and Servicing Agreement
15
resulting in an encumbrance against real or personal property of a Person,
including, without limitation, any conditional sale or other title retention
agreement, any financing lease having substantially the same economic effect as
any of the foregoing and the filing of any financing statement under the UCC or
comparable law of any jurisdiction to evidence any of the foregoing.
"Loss and Dilution Reserve" shall mean, with respect to any Series,
the amount set forth in the related Supplement as the loss and dilution reserve
for such Series.
"Majority in Interest" shall mean the Holders of Certificates
evidencing 51% or more of the Aggregate Certificateholders' Interest or, if in
respect of any Series, the Holders of Certificates evidencing 51% or more of the
aggregate Certificateholders' Interest in such Series or in relation to any
Series which has an Enhancement as otherwise specified in the Supplement related
to such Series.
"Mobil Corporation" shall mean Mobil Corporation, a New York
corporation.
"Moody's" shall mean Xxxxx'x Investors Service, Inc. or its
successor.
"Muehlstein" shall mean X. Xxxxxxxxxx & Co., Inc., a New York
corporation.
"Muehlstein Collection Account" shall have the meaning specified in
Section 4.02(b).
"Muehlstein Collection Account Bank" shall have the meaning
specified in Section 4.02(b).
"Muehlstein Collection Account Letter" shall have the meaning
specified in Section 4.02(b).
"Muehlstein Credit Policy Manual" shall mean those credit and
collection policies and practices of the Servicer described in the credit policy
and procedures manual, substantially in the form of Exhibit F hereto, in effect
on the date hereof relating to Receivables, as the same may be amended or
modified from time to time in compliance with Section 3.04(j).
"Xxxxxxxxxx International" shall mean Xxxxxxxxxx International,
Ltd., a New York corporation.
"Muehlstein Post Office Box" shall have the meaning specified in
Section 4.02(b).
Pooling and Servicing Agreement
16
"Multiemployer Plan" means a multiemployer plan, as defined in
Section 4001(a)(3) of ERISA, to which the Transferor or any ERISA Affiliate is
making or accruing an obligation to make contributions, or has within any of the
preceding five plan years made an accrued obligation to make contributions.
"Multiple Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of the
Transferor or any ERISA Affiliate and at least one Person other than the
Transferor and the ERISA Affiliates or (b) was so maintained and in respect of
which the Transferor or any ERISA Affiliate could have liability under Section
4064 or 4069 of ERISA in the event such plan has been or were to be terminated.
"Net Receivables Balance"shall mean at any time the Outstanding
Balance of all Receivables then included in the Trust Assets which are then
Eligible Receivables (whether or not any such Receivable was an Eligible
Receivable when acquired or thereafter) reduced, without duplication, in the
order set forth below, by
(i) the aggregate amount by which the Outstanding Balance of all
such Eligible Receivables of any Obligor and its Affiliates taken together
exceeds the product of (A) the Obligor Concentration Limit for such
Obligor multiplied by (B) the Outstanding Balance of all Receivables
included in the Trust Assets which are Eligible Receivables at such time,
and
(ii) the aggregate amount by which the Outstanding Balance (net of
amounts deducted under clause (i) above) of all such Eligible Receivables
of all Obligors domiciled in any country exceeds the product of (A) the
Country Concentration Limit for such country multiplied by (B) the
Outstanding Balance (net of amounts deducted under clause (i) above) of
all Receivables included in the Trust Assets which are Eligible
Receivables at such time, and
(iii) the aggregate amount by which the Outstanding Balance (net of
amounts deducted under clauses (i) and (ii) above) of all such Eligible
Receivables of all Obligors domiciled in any Non-Investment
Grade/Non-Rated Country exceeds the product of (A) the Aggregate
Non-Investment Grade/Non-Rated Country Concentration Limit multiplied by
(B) the Outstanding Balance (net of amounts deducted under clauses (i) and
(ii) above) of all Receivables included in the Trust Assets which are
Eligible Receivables at such time; and
(iv) the aggregate amount by which the Outstanding Balance (net of
amounts deducted under clauses (i), (ii) and (iii) above) of all such
Eligible Receivables the payment of which is supported by a letter of
credit exceeds 15% of the Outstanding Balance of all Receivables included
in the Trust Assets at such time.
Pooling and Servicing Agreement
17
"Non-Investment Grade/Non-Rated Country" shall mean any country any
class of whose non-credit enhanced long-term senior unsecured debt is not rated
by Xxxxx'x and S&P or is rated below investment grade by either Moody's or S&P.
"Obligor" shall mean each Person who is obligated to pay for
merchandise or services provided by any Originator which gave rise to a
Receivable, including any guarantor of such Person's obligations.
"Obligor Concentration Limit" shall mean, on any date with respect
to any Obligor, the percentage set forth below opposite the Public Debt Rating
of such Obligor or such different percentage as shall be selected by the
Transferor; provided that the Rating Agency Condition shall have first been
satisfied with respect to such different percentage, provided further that in
the case of an Obligor with any Affiliate that is also an Obligor, the
Concentration Limit shall be applicable as if such Obligor and such Affiliate
were one Obligor:
S&P Moody's Percentage
--- ------- ----------
BBB- or A3 or better Baa3 or P3 or better 4.0%
Non-Rated or Other Non-Rated or Other 2.0%
"Officer's Certificate" shall mean, unless otherwise specified in
this Agreement, a certificate signed by the President, Vice-President, Chief
Financial Officer, Secretary- Treasurer, Controller, or Assistant Treasurer of
the Transferor, Servicer or any Successor Servicer, or any Responsible Officer
of the Trustee in the event the Trustee is acting as Successor Servicer, as the
case may be, and delivered to the Trustee, each Rating Agency and any
Enhancement Provider.
"Opinion of Counsel" shall mean a written opinion of counsel, who
may be counsel for, or an employee of, the Person providing the opinion (and,
with respect to the Originators and the Transferor, may be XxXxxxxxx, Will &
Xxxxx) and who shall be reasonably acceptable to the Trustee.
"Originator" shall mean Muehlstein, Xxxxxxxxxx International and any
other Person or division of any Person designated from time to time as an
Originator pursuant to the terms of both Section 2.07 and the Receivables
Purchase Agreements.
"Outstanding Balance" of any Receivable or designated class of
Receivables at any time shall mean the then outstanding principal balance
thereof, whether or not written-off as uncollectible, converted to an
"instrument" or transferred to a "suspense" account and whether or not payment
thereon has been deferred.
Pooling and Servicing Agreement
18
"Parent Undertaking Agreement" shall mean the agreement among
Muehlstein and the Trustee, dated as of the date hereof, governing the terms and
conditions upon which Muehlstein shall cause the performance of certain
obligations of the Servicer, as the same may from time to time be amended,
modified or otherwise supplemented.
"Partial Amortization Period" shall mean, a period beginning on and
including a Pool Non-compliance Date and ending on but excluding the earlier of
(a) the first date thereafter on which the Net Receivables Balance equals or
exceeds the Required Net Receivables Balance and (b) the fifth consecutive
Business Day following the occurrence of such Pool Non-compliance Date.
"PBGC" means the Pension Benefit Guaranty Corporation (or any
successor).
"Person" shall mean any individual, corporation, partnership,
limited liability company, joint venture, association, joint-stock company,
trust, unincorporated organization, Governmental Authority or any other entity
of a similar nature.
"Plan" means a Single Employer Plan or Multiple Employer Plan.
"Plan Event" means (a) (i) the occurrence of a reportable event,
within the meaning of Section 4043 of ERISA, with respect to any Plan unless the
30-day notice requirement with respect to such event has been waived by the
PBGC, or (ii) the requirements of subsection (1) of Section 4043(b) of ERISA
(without regard to subsection (2) of such Section) are met with respect to a
contributing sponsor, as defined in Section 4001(a)(13) or ERISA, of a Plan, and
an event described in paragraph (9), (10), (11), (12) or (13) of Section 4043(c)
of ERISA is reasonably expected to occur with respect to such Plan within the
following 30 days; (b) the application for a minimum funding waiver with respect
to a Plan; (c) the provision by the administrator of any Plan of a notice of
intent to terminate such Plan, pursuant to Section 4041(a)(2) of ERISA
(including any such notice with respect to a plan amendment referred to in
Section 4041(3) of ERISA); (d) the cessation of operations at a facility of any
Originator or any ERISA Affiliate in the circumstances described in Section
4062(e) of ERISA; (e) the withdrawal by any Originator or any ERISA Affiliate
from a Multiple Employer Plan during a plan year for which it was a substantial
employer, as defined in Section 4001(a)(2) of ERISA; (f) the conditions for
imposition of a lien under Section 302(f) of ERISA shall have been met with
respect to any Plan; (g) the adopting of an amendment to a Plan requiring the
provision of security to such Plan pursuant to Section 307 of ERISA; or (h) the
institution by the PBGC of proceedings to terminate a Plan pursuant to Section
4042 of ERISA, or the occurrence of any event or condition described in Section
4042 of ERISA that constitutes grounds for the termination of, or the
appointment of a trustee to administer, such Plan.
"Pool Non-compliance Date" shall mean any day on which the Net
Receivables
Pooling and Servicing Agreement
19
Balance falls below the Required Net Receivables Balance.
"Principal Terms" shall mean, with respect to any Series: (a) the
name or designation; (b) the initial principal amount (or method for calculating
such amount); (c) the Certificate Rate (or method for the determination
thereof); (d) the payment date or dates and the date or dates from which
interest shall accrue; (e) the method for allocating Collections to Investor
Certificateholders of such Series; (f) the designation of any Series Accounts
and the terms governing the operation of any such Series Accounts; (g) the
issuer and terms or any form of Enhancement with respect thereto; (h) the terms,
if any, on which the Investor Certificates of such Series may be exchanged for
Investor Certificates of another Series, repurchased or redeemed by the
Transferor or remarketed to other investors; (i) the Series Servicing Fee and
the Series Trustee's Fee; (j) the Amortization Date and the Termination Date for
such Series; and (k) any other terms of such Series.
"Public Debt Rating" shall mean, as of any date and with respect to
any Person or country, the lowest rating that has been most recently announced
by either Moody's or S&P, as the case may be, for any class of non-credit
enhanced long-term or short-term senior unsecured debt issued by such Person or
country, as the case may be.
"Purchase Price" shall mean, with respect to any Receivable, the
purchase price therefor specified in each Receivables Purchase Agreement
applicable to such Receivable.
"Rating Agency" shall mean each such nationally recognized
statistical rating organization which has rated any Series of Certificates at
the request of the Transferor.
"Rating Agency Condition" shall mean, with respect to any specified
action, that each Rating Agency, upon the written request of the Transferor, the
Servicer or the Trustee, shall have notified all of such parties in writing that
such action in and of itself will not result in a reduction or withdrawal of the
rating of any outstanding Series with respect to which it is a Rating Agency
and, in relation to a Series with respect to which an Enhancement is in effect,
the Enhancement Provider has given its prior written consent thereto.
"Receivable" shall mean an account receivable or other indebtedness
shown on the records of any Originator as of the Transfer Date, and as of each
date from time to time thereafter, arising from the sale or delivery of
merchandise or providing of services by any Originator (whether constituting an
account, contract right, chattel paper, instrument, general intangible or
otherwise) and including without limitation all monies due or to become due
(whether as payment of purchase price, interest, finance charges or otherwise)
and all Collections and other amounts received or receivable from time to time
with respect to such indebtedness and all proceeds (including, without
limitation, all cash collections and all "proceeds" as defined in the UCC of the
State of New York and of the jurisdiction the law of which governs the
perfection of all rights, titles, interests, remedies, powers and privileges
Pooling and Servicing Agreement
20
purported to be transferred by or pursuant to this Agreement) thereof,
including, without limitation, all amounts on deposit in any Muehlstein
Collection Accounts, and "Receivables" shall mean all such Receivables.
"Receivables Purchase Agreement" shall mean each of the agreements
between either Muehlstein or Xxxxxxxxxx International, as seller, and the
Transferor, as purchaser, dated as of the date hereof which govern terms and
conditions upon which the Transferor shall have acquired and shall acquire the
Receivables transferred to the Trust, as the same may from time to time be
amended, modified or otherwise supplemented.
"Reconveyed Receivable" shall have the meaning specified in Section
2.04.
"Record Date" shall mean, with respect to any Distribution Date, the
last day of the preceding calendar month.
"Related Security" means with respect to any Transferor Receivable
(i) all of the Transferor's interest in each Contract related thereto, including
all rights pursuant to each such Contract to repossess or receive merchandise
relating to the sale which gave rise to such Receivable; (ii) all other Liens
and property subject to such Liens from time to time purporting to secure
payment of such Receivable, whether pursuant to the Contract related to such
Receivable or otherwise, together with all financing statements signed by an
Obligor describing any collateral securing such Receivable and (iii) all
guarantees, letters of credit, insurance and other agreements or arrangements of
whatever character from time to time supporting or securing payment of such
Receivable, whether pursuant to the Contract related to such Receivable or
otherwise; provided, however, that the foregoing shall not include any inventory
of any Originator prior to the sale thereof.
"Removed Originator" shall have the meaning specified in Section
2.07(b).
"Required Net Receivables Balance" shall mean, as of any day of
determination, the sum of (i) the aggregate of the Loss and Dilution Reserves
for all outstanding Series, plus (ii) the aggregate of the Yield/Fee Reserves
for all outstanding Series plus (iii) the aggregate of all Invested Amounts for
all outstanding Series (computed as if reduced by (A) the aggregate amount of
Cure Funds held in the Cure Account for each Series and (B) the cumulative
amount of funds held at such time in the Concentration Account as all or a
portion of the Trust Partial Amortization Amount allocable to each such Series).
"Requirement of Law" shall mean any law, treaty, rule or regulation,
or final determination of an arbitrator or Governmental Authority, and, when
used with respect to any Person, the certificate of incorporation and by-laws or
other organizational or governing documents of such Person.
Pooling and Servicing Agreement
21
"Responsible Officer" shall mean, (i) when used with respect to the
Trustee, any officer within the Corporate Trust Office of the Trustee including
any Managing Director, Vice-President, Assistant Vice-President, Assistant
Secretary, Treasurer, Assistant Treasurer or any other officer of the Trustee
who customarily performs functions similar to those performed by the Persons who
at the time shall be such officers, respectively, or to whom any matter is
referred because of such officer's knowledge of and familiarity with the
particular subject, and (ii) when used with respect to the Transferor, the
Servicer, Muehlstein or Xxxxxxxxxx International, any of the President,
Vice-President, Chief Financial Officer, Secretary-Treasurer, Assistant
Secretary or Assistant Treasurer.
"Revolving Period" shall mean, with respect to any Series, the
period specified in the related Supplement.
"S&P" shall mean Standard & Poor's Ratings Services, a division of
The XxXxxx-Xxxx Companies.
"Series" shall mean any series of Investor Certificates.
"Series Account" shall mean any deposit, trust, escrow, reserve or
similar account maintained for the benefit of the Investor Certificateholders of
any Series, as specified in any Supplement.
"Series Allocation Percentage" shall mean, with respect to any
Series, the percentage equivalent of a fraction, the numerator of which is the
sum of (a) the Invested Amount for such Series (computed as if reduced by (A)
the amount of Cure Funds held in the Cure Account for such Series and (B) the
cumulative amount of funds held at such time in the Concentration Account
allocated to the portion of the Trust Partial Amortization Amount allocable to
such Series) plus (b) the Yield/Fee Reserve for such Series, plus (c) the Loss
and Dilution Reserve for such Series, and the denominator of which is the
aggregate of the amounts specified in clauses (a), (b) and (c) for all
outstanding Series.
"Series Servicing Fee" shall mean, with respect to any Series, the
amount of the servicing fee specified in the applicable Supplement.
"Series Trustee's Fee" shall mean, with respect to any Series, the
amount of the Trustee's fee specified in the applicable Supplement.
"Service Transfer" shall have the meaning specified in Section 10.01
"Servicer" initially shall mean Muehlstein and, after any Service
Transfer, shall mean the Successor Servicer.
Pooling and Servicing Agreement
22
"Servicer Default" shall have the meaning specified in Section
10.01.
"Servicing Fee" shall have the meaning specified in Section 3.02(a).
"Single Employer Plan" means a single employer plan, as defined in
Section 4001(a)(15) of ERISA, that (a) is maintained for employees of any
Originator and the ERISA Affiliates or (b) was so maintained and in respect of
which any Originator or any other ERISA Affiliate could have liability under
Section 4069 of ERISA in the event such plan has been or were to be terminated.
"Subordinated Note" shall mean any note issued pursuant to a
Receivables Purchase Agreement which evidences a loan for the excess, if any, of
the Purchase Price over the actual payment therefor, which loan is deemed to be
made by the Seller of the Receivables to the Purchaser.
"Successor Servicer" shall have the meaning specified in Section
10.02(a).
"Supplement" shall mean, with respect to any Series, a supplement to
this Agreement, executed and delivered in connection with the original issuance
of the Investor Certificates of such Series pursuant to Article VI, and all
amendments, modifications or supplements to such supplement or this Agreement.
"Supplemental Certificate" shall have the meaning specified in
Section 6.08(c).
"Tax Opinion" shall mean, with respect to any action, an Opinion of
Counsel who is not an employee of the Servicer or any Affiliate of the Servicer
to the effect that, for federal and Connecticut (and any other State where
substantial servicing activities in respect of Receivables are conducted by the
Transferor or the Servicer if there is a substantial change from present
servicing activities) state income and franchise tax purposes, (a) such action
will not adversely affect the characterization of the Investor Certificates of
any outstanding Series as debt of the Transferor for tax purposes, (b) such
action will not cause a taxable event to any Investor Certificateholder, (c)
following such action the Trust should not be treated as an association (or
publicly traded partnership) taxable as a corporation, (d) in the case of the
original issuance of Certificates, either (i) the Investor Certificates will
properly be characterized as debt of the Transferor or (ii) the Investor
Certificates should properly be characterized as debt of the Transferor, or if
not debt, as an interest in a partnership and not in an association taxable as a
corporation and (e) in the case of Section 6.08(b), the Investor Certificates of
the new Series will properly be characterized as debt of the Transferor.
"Termination Date" shall mean, with respect to any Series, the
termination date specified in the related Supplement.
Pooling and Servicing Agreement
23
"Termination Notice" shall have the meaning specified in Section
10.01.
"Transaction Documents" shall mean the collective reference to this
Agreement, each Supplement, each Certificate, each Receivables Purchase
Agreement, each Enhancement Agreement, the Parent Undertaking Agreement, the
Intercreditor Agreement, each certificate purchase agreement and the Fee Letter
for each Series.
"Transfer" shall have the meaning specified in Section 2.01(a), it
being understood that the date of Transfer of any Receivable or other Trust
Asset shall be (i) for each Receivable and Trust Asset in existence on the
Transfer Date, the Transfer Date and (ii) for each other Receivable and Trust
Asset, the date on which such Receivable or other Trust Asset shall be created
or otherwise arise and, in the case of such Receivable, be acquired by the
Transferor under the applicable Receivables Purchase Agreement.
"Transfer Agent and Registrar" shall have the meaning specified in
Section 6.03(a).
"Transfer Date" shall mean September 25, 1996, the initial date of
Transfer of Receivables into the Trust.
"Transferor" shall mean Muehlstein Financial Corporation, a Delaware
corporation.
"Transferor Certificate" shall mean the certificate executed by the
Transferor and authenticated by or on behalf of the Trustee, in substantially
the form of Exhibit A hereto.
"Transferor Interest" shall have the meaning specified in Section
4.01(a).
"Transferor Percentage" shall mean at any time 100% minus the
aggregate of the Floating Allocation Percentages of all outstanding Series at
such time.
"Transferor Receivable" shall mean a Receivable acquired by the
Transferor pursuant to a Receivables Purchase Agreement.
"Transferor's Account" shall mean the special account designated
under the account name "Muehlstein Financial Corporation", being account number
4070-6702 under the dominion and control of the Transferor, for deposits by the
Servicer pursuant to the applicable Supplement, maintained at Citibank, N.A. in
New York, New York or such other account at such other bank, under the dominion
and control of the Transferor, as the Transferor may designate for such purpose
from time to time.
"Trust" shall mean the Muehlstein Trade Receivables Master Trust
created by
Pooling and Servicing Agreement
24
this Agreement, the corpus of which shall consist of the Trust Assets.
"Trust Assets" shall have the meaning specified in Section 2.01(a).
"Trust Early Amortization Event" shall have the meaning specified in
Section 9.01.
"Trust Invested Amount" shall mean, at any time, the sum of the
Invested Amounts for all outstanding Series at such time.
"Trust Partial Amortization Amount" shall mean, with respect to any
date of determination during a Partial Amortization Period, the amount by which
the Net Receivables Balance is less than the Required Net Receivables Balance.
"Trustee" shall mean Bankers Trust Company, not in its individual
capacity but solely in its capacity as trustee on behalf of the Trust, or its
successor in interest, or any successor trustee appointed as herein provided.
"Trustee's Account" with respect to each Series, shall have the
meaning specified in the related Supplement.
"Trustee's Fee" shall have the meaning specified in Section
11.05(a).
"UCC" shall mean the Uniform Commercial Code, as amended from time
to time, as in effect in any applicable or specified jurisdiction.
"Undivided Fractional Interest" with respect to each Series, shall
have the meaning specified in the related Supplement.
"Yield/Fee Reserve" shall mean, with respect to each Series, the
amount set forth in the related Supplement as the yield/fee reserve for such
Series.
SECTION 1.02. Other Definitional Provisions. (a) 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.
(b) As used herein and in any certificate or other document made or
delivered pursuant hereto or thereto, accounting terms not defined in this
Agreement, and accounting terms partly defined in this Agreement to the extent
not completely defined, shall have the respective meanings given to them under
GAAP or regulatory accounting principles, as applicable and in effect from time
to time. To the extent that the definitions of accounting terms herein are
inconsistent with the meanings of such terms under GAAP or regulatory
Pooling and Servicing Agreement
25
accounting principles, the definitions contained herein shall control.
(c) The words "hereof", "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement; Section, Schedule
and Exhibit references contained in this Agreement are references to Sections,
Schedules and Exhibits in or to this Agreement unless otherwise specified; the
term "including" means "including without limitation".
ARTICLE II
TRANSFER OF RECEIVABLES
SECTION 2.01. Transfer of Receivables. (a) By execution of this
Agreement, the Transferor does hereby transfer, assign, set-over and otherwise
convey without recourse, except as expressly provided herein (the making of such
transfer, assignment, set-over and conveyance being a "Transfer", and so to
transfer, assign, set-over and otherwise convey being to "Transfer") to the
Trust for the benefit of the Certificateholders:
(i) all of the Transferor's right, title and interest in, to and
under all Transferor Receivables existing at the close of business on the
Transfer Date and thereafter created from time to time, and conveyed to
the Transferor under the Receivables Purchase Agreements from time to
time, until the termination of the Revolving Period of the last
outstanding Series, and all monies due or to become due and all
Collections in respect of such Transferor Receivables and other amounts
received or receivable from time to time with respect to such Transferor
Receivables and all proceeds (including, without limitation, "proceeds" as
defined in the UCC of the State of New York and of the jurisdiction the
law of which governs the perfection of the interest in the Transferor
Receivables transferred hereunder) thereof;
(ii) all of the Transferor's rights, remedies, powers and privileges
under the Receivables Purchase Agreements existing at the close of
business on the Transfer Date and thereafter created from time to time;
and
(iii) all of the Transferor's right, title and interest in, to and
under the Related Security.
Such property described in the preceding sentence, together with all monies from
time to time on deposit in, and all Eligible Investments and other securities,
instruments and other investments purchased from funds on deposit in, the
Concentration Account, the Muehlstein Collection Accounts and any Series
Account, and any Enhancement issued with respect to any Series (the drawing on
or payment of such Enhancement not being available to
Pooling and Servicing Agreement
26
Certificateholders of any other Series) and all of the Transferor's rights,
remedies, powers, and privileges under the Receivables Purchase Agreements shall
constitute the assets of the Trust (collectively the "Trust Assets").
The foregoing Transfer does not constitute and is not intended to
result in an assumption by the Trust, the Trustee or any Certificateholder of
any obligation of the Servicer, Muehlstein, the Transferor or any other Person
in connection with the Receivables or under any Receivables Purchase Agreement
or under any agreement or instrument relating thereto, including, without
limitation, any obligation to any Obligor. The foregoing Transfer to the Trust
is and shall be made to the Trustee, on behalf of the Trust, and each reference
in this Agreement to such Transfer shall be construed accordingly.
The Transferor agrees to record and file from time to time, at its
own expense, financing statements and other documents (and amendments thereto,
assignments thereof and continuation statements, when applicable) with respect
to the Receivables and the other Trust Assets now existing and hereafter created
meeting the requirements of applicable law in such manner and in such
jurisdictions as are necessary to perfect, and maintain perfection of, the
Transfers of the Receivables and the other Trust Assets to the Trust, and to
deliver a file- stamped copy of any such financing statement or other document
or other evidence of such filing to the Trustee on or prior to the Transfer
Date. The Trustee shall be under no obligation whatsoever to file any such
financing statements, documents, amendments, assignments or continuation
statements or to make any other filing under the UCC in connection with such
Transfer or to monitor the status of the perfection evidenced by such filings.
The Servicer and the Transferor further agree, at their own expense,
on or prior to the Transfer Date to xxxx their computer records in a manner
reasonably calculated to indicate that the Trust Assets have been conveyed, in
the case of any Originator, to the Transferor in accordance with the Receivables
Purchase Agreements and, in the case of the Transferor, to the Trust in
accordance with this Agreement for the benefit of the Certificateholders.
(b) The Trustee agrees to use its best efforts, and shall cause its
agents or representatives to use their best efforts, to hold in confidence all
Confidential Information; provided that nothing herein shall prevent the Trustee
from delivering copies of any financial statements and other documents
constituting Confidential Information, or disclosing any other Confidential
Information, (i) to a Successor Servicer or as required by a Requirement of Law
applicable to the Trustee, (ii) as required in the performance of the Trustee's
duties hereunder, (iii) as required in enforcing the rights of the
Certificateholders hereunder, (iv) to each Enhancement Provider, (v) as provided
in any Supplement or (vi) to any affiliate, independent or internal auditor,
agent, employee or attorney of the Trustee having a need to know the same,
provided that the Trustee advises such recipient of the confidential nature of
the information being disclosed and each such recipient agrees to be bound by
the terms of this
Pooling and Servicing Agreement
27
Section. The Trustee will allow the Transferor to inspect the Trustee's security
and confidentiality arrangements upon prior written notice from time to time
during normal business hours and agrees to provide reasonable advance notice to
the Transferor of any permitted disclosure. The Trustee shall provide reasonable
prior written notice to the Transferor whenever any disclosure not otherwise
permitted by this Section 2.01(b) is to be made.
SECTION 2.02. Acceptance by Trustee. (a) There is hereby created the
Muehlstein Trade Receivables Master Trust. The Trustee hereby acknowledges its
acceptance on behalf of the Trust of all right, title and interest in and to the
Trust Assets now existing and hereafter created and transferred to the Trust
pursuant to Section 2.01 and the Trustee declares that it shall maintain such
right, title and interest upon the trust herein set forth for the benefit of all
Certificateholders.
(b) The Trustee shall have no power to create, assume or incur
indebtedness or other liabilities in the name of the Trust or to transfer or
place Liens on Trust Assets other than as contemplated in this Agreement.
(c) The Trustee is hereby authorized and directed to execute and
deliver to the other parties thereto each Transaction Document to which the
Trustee is a party.
SECTION 2.03. Representations and Warranties of the Transferor
Relating to the Transferor. The Transferor hereby represents and warrants to the
Trustee for the benefit of the Trust as of the date hereof and, by accepting on
the Transfer Date the proceeds of such Transfer, as of the Transfer Date and,
with respect to any Series, as of the date of the related Supplement and the
related Initial Issuance Date, unless otherwise stated in such Supplement, that:
(a) Organization and Good Standing. The Transferor is a corporation
duly organized and validly existing under the laws of the State of
Delaware and has full power, authority and legal right to own and convey
its properties and conduct its business as presently owned or conducted,
to execute, deliver and perform its obligations under this Agreement and
the Receivables Purchase Agreements, and to execute and deliver the
Certificates to the Trustee pursuant hereto.
(b) Due Qualification. The Transferor is duly qualified to do
business and has obtained all necessary licenses or approvals in each
jurisdiction in which failure to so qualify or to obtain such licenses or
approvals could have a material adverse effect on the Transferor's ability
to perform its obligations hereunder, under the applicable Supplement or
under the Receivables Purchase Agreements.
(c) Due Authorization. The execution, delivery and performance of
this
Pooling and Servicing Agreement
28
Agreement, the applicable Supplement and the Receivables Purchase
Agreements by the Transferor, the execution and delivery by the Transferor
to the Trustee of the Certificates, and the consummation by the Transferor
of the transactions contemplated by this Agreement, the applicable
Supplement and the Receivables Purchase Agreements, have been duly and
validly authorized by all necessary action on the part of the Transferor,
and this Agreement and the other agreements and instruments executed or to
be executed in connection herewith have been duly executed and delivered
on behalf of the Transferor.
(d) Enforceability. Each of this Agreement, the applicable
Supplement and the Receivables Purchase Agreements 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, reorganization, insolvency,
moratorium or other similar laws affecting creditors' rights generally,
now or hereafter 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). Each of the Receivables Purchase Agreements is in full
force and effect, and is not subject, as to any party thereto, to any
specific dispute, offset, counterclaim or defense of such party.
(e) No Conflict. The Transferor's execution and delivery of this
Agreement, any Supplement, the Receivables Purchase Agreements and the
Certificates, performance of the transactions contemplated by this
Agreement, any Supplement and the Receivables Purchase Agreements, and
fulfillment of the terms hereof applicable to the Transferor, do not
contravene (1) the Transferor's articles of incorporation, (2) conflict
with or violate any Requirement of Law applicable to the Transferor,
violate any provision of, or require any filing (except for the filings
under the UCC required hereof, each of which has been or is being duly
made and will be in full force and effect on the applicable Initial
Issuance Date), registration, consent or approval under, any Requirement
of Law presently in effect having applicability to the Transferor, except
for such filings, registrations, consents or approvals as have already
been obtained and are in full force and effect, (3) conflict with, result
in any breach of any of the terms and provisions of, or constitute (with
or without notice or lapse of time or both) a default under, any
indenture, contract, agreement, mortgage, deed of trust or other
instrument to which the Transferor is a party or by which it or its
properties or assets are bound, or (4) result in, or require, the creation
or imposition of any Lien upon or with respect to any of the properties
now owned or hereafter acquired by the Transferor other than as
specifically contemplated by this Agreement.
(f) No Proceedings. There are no proceedings, injunctions, writs,
restraining orders or other orders or investigations pending or, to the
best knowledge of the Transferor, threatened against the Transferor before
any Governmental Authority.
Pooling and Servicing Agreement
29
(g) Consents. No authorization, consent, license, order or approval
of, registration or declaration with, any Person or Governmental Authority
is required to be obtained, effected or given by the Transferor in
connection with the execution and delivery of this Agreement, the
applicable Supplement, the Receivables Purchase Agreements, the transfer
of the Trust Assets and the Certificates to the Trust by the Transferor or
the performance of its obligations under this Agreement, the applicable
Supplement and the Receivables Purchase Agreements or the transactions
contemplated hereby and thereby and the fulfillment by the Transferor of
the terms hereof, except for (i) authorizations, consents, licenses,
orders, approvals and the filing of the financing statements or other
documents required to have been filed on or prior to the Transfer Date
pursuant to Section 2.01, all of which were so obtained or filed and are
in full force and effect, and (ii) the filing from time to time of any
amendments, assignments or continuation statements which may become
applicable pursuant to Section 2.01.
(h) Liens on Properties. Except as created hereby, and except for
Liens that will be terminated prior to the Transfer Date, there are no
Liens of any nature whatsoever on any Receivable. The Transferor is not a
party to any contract, agreement, lease or instrument (other than this
Agreement or as contemplated by this Agreement) the performance of which,
either unconditionally or upon the happening of an event, will result in
or require the creation of any Lien on any Receivable, or otherwise result
in a violation of this Agreement.
(i) Contractual Obligations. (i) The Transferor is not a party to
any indenture, loan or credit agreement or any lease or other agreement or
instrument, or subject to any Requirement of Law, that would have an
adverse effect on the ability of the Transferor to carry out its
obligations under this Agreement or any Transaction Documents to which it
is a party, and (ii) neither the Transferor nor, to the best knowledge of
the Transferor, any other party is in default in any respect under or with
respect to the Receivables Purchase Agreements or any other contract,
agreement, lease or instrument to which the Transferor is a party.
(j) Investment Company Act. The Transferor is not an "investment
company", or an "affiliated person" of, or "promoter" or "principal
underwriter" for, or a company controlled by, an "investment company",
within the meaning of and as such terms are defined in the Investment
Company Act.
(k) Locations. The chief place of business and chief executive
office of the Transferor, and the office where the Transferor keeps the
originals of its books, records and documents regarding the Receivables
and the other Trust Assets of the Transferor are located at the address of
the Transferor specified in Section 13.04. The Transferor maintains no
other business locations.
Pooling and Servicing Agreement
30
(l) Tradenames. The legal name of the Transferor is as set forth on
the signature page of this Agreement and the Transferor has no tradenames,
fictitious names, assumed names or "doing business as" names.
(m) Subsidiaries. The Transferor has no subsidiaries.
(n) Accuracy of Information. Each certificate, information, exhibit,
financial statement, document, book, record or report furnished by the
Transferor to the Trustee, any Enhancement Provider or the Servicer in
connection with this Agreement is accurate in all material respects as of
its date.
(o) Solvency. The Transferor is solvent and will not become
insolvent after giving effect to the transactions contemplated by this
Agreement; the Transferor is currently repaying all of its indebtedness as
such indebtedness becomes due; and, after giving effect to the
transactions contemplated by this Agreement, the Transferor will have
adequate capital to conduct its business as presently conducted and as
contemplated by this Agreement.
(p) Compliance. The Transferor has complied, and will comply on each
Initial Issuance Date, (i) with each Requirement of Law with respect to
all Receivables transferred to the Trust hereunder and the Contracts
related thereto and (ii) in all material respects, with each Requirement
of Law with respect to its business or properties.
(q) Taxes. The Transferor has filed all tax returns (federal, state
and local) which it reasonably believes are required to be filed and has
paid or made adequate provision for the payment of all taxes, assessments
and other governmental charges due from the Transferor or is contesting
any such tax, assessment or other governmental charge in good faith
through appropriate proceedings as to which adequate reserves are being
maintained and no lien with respect thereto has attached to its property
and become enforceable against its other creditors. The Transferor knows
of no reasonable basis for any additional tax assessment for any fiscal
year for which adequate reserves have not been established.
(r) Use of Proceeds. No proceeds of the issuance of any Certificate
will be used by the Transferor to acquire any security in a transaction
that is subject to Sections 13 and 14 of the Securities Exchange Act of
1934, as amended, or to purchase or carry any margin security in violation
of any applicable law or regulation.
(s) Xxxxxxxxxx Collection Accounts. The Xxxxxxxxxx Collection
Account Banks are the only institutions holding Xxxxxxxxxx Collection
Accounts for the receipt of payments from Xxxxxxxxxx Post-Office Boxes in
respect of Receivables (subject to
Pooling and Servicing Agreement
31
such changes as may be made from time to time in accordance with Section
4.02(b)), and all Obligors, and only such Obligors, have been instructed
or, upon the creation of Receivables, will be instructed to make payments
only to Xxxxxxxxxx Collection Accounts and such instructions have not been
modified or revoked by the Transferor and such instructions that have been
given are in full force and effect.
(t) Trust Early Amortization Event. As of the Initial Issuance Date
for any Series, no Trust Early Amortization Event and no condition that
with the giving of notice and/or the passage of time would constitute a
Trust Early Amortization Event, has occurred and is continuing.
(u) ERISA. No Plan has any accumulated funding deficiency, as
defined in Section 3.02(q) of ERISA, whether or not waived. The Transferor
and each ERISA Affiliate has timely made all contributions required to be
made by it to any Plan. No Plan Event with respect to any Plan has
occurred or could reasonably be expected to occur that could result,
directly or indirectly, in any Lien being imposed on the property of the
Transferor. Neither the Transferor nor any ERISA Affiliate has incurred,
or could reasonably be expected to incur, withdrawal liability to, or
liability in connection with, the reorganization, termination or
insolvency of any Multiemployer Plan.
(v) Fraudulent Conveyance. The Transferor is not entering into the
transactions contemplated hereby with the intent of hindering, delaying or
defrauding creditors.
(x) Limited Purpose. The Transferor engages in no activities other
than those contemplated by the Transaction Documents.
(x) Certificates. Each Certificate, when executed and authenticated
by the Trustee in accordance with the terms of Section 6.01 and delivered
to and paid for by the Investor Certificateholder pursuant to the related
Supplement, will be validly issued and outstanding and entitled to the
benefits of this Agreement and the related Supplement.
The representations and warranties set forth in this Section 2.03
shall survive the Transfer of the Receivables to the Trust and the issuance of
the Certificates, and shall cease and be of no effect upon the indefeasible
repayment in full of the Invested Amount of the last outstanding Series and all
other obligations of the Transferor hereunder. Upon discovery by the Transferor,
the Servicer or a Responsible Officer of the Trustee of a breach of any of the
foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the other parties and to any Enhancement
Provider. The Trustee's obligations in respect of any such breach are limited as
provided in Section 11.02(g).
Pooling and Servicing Agreement
32
SECTION 2.04. Representations and Warranties of the Transferor
Relating to the Trust Assets. The Transferor hereby represents and warrants to
the Trustee, for the benefit of the Trust, as of the date hereof and, by
accepting on the Transfer Date the proceeds of such Transfer, as of the Transfer
Date and, except for the representation and warranty contained in subparagraph
(j), by accepting on each date during the Revolving Period for any Series the
proceeds of each Transfer of Receivables, as of such date, that:
(a) Valid Transfer. Each of the Receivables Purchase Agreements
creates a valid sale, transfer and assignment to the Transferor of, and
the Transferor is the legal and beneficial owner of, all right, title and
interest of the Originators in and to the Receivables and Related Security
now existing and hereafter created during the Revolving Period and the
proceeds thereof. This Agreement constitutes a valid transfer and
assignment to the Trust of all right, title and interest of the Transferor
in and to the Receivables now existing and hereafter created and purchased
by the Transferor pursuant to the Receivables Purchase Agreements, and in
and to all other Trust Assets and the proceeds thereof and such funds as
are required to be deposited pursuant to this Agreement from time to time
in the Concentration Account, the Xxxxxxxxxx Collection Accounts and any
Series Account, or, if this Agreement does not constitute such a transfer
and assignment, constitutes a valid grant to the Trust of a first priority
perfected "security interest" (as defined in the UCC of the State of New
York and of the jurisdiction the law of which governs the perfection of
the interest in the Receivables and other Trust Assets created hereunder)
in all right, title and interest of the Transferor in and to the
Receivables now existing and hereafter created and purchased by the
Transferor pursuant to the Receivables Purchase Agreements, and in and to
all other Trust Assets and the proceeds thereof which, in the case of
existing Receivables and the other existing Trust Assets and the proceeds
thereof, is enforceable (except as such enforceability may be limited by
applicable bankruptcy, reorganization, insolvency, moratorium or other
similar laws affecting creditors' rights generally, now or hereafter 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) by
the Trustee upon execution and delivery of this Agreement, and which, in
the case of the Receivables and all other Trust Assets hereafter created
and the proceeds thereof, will be enforceable (except as such
enforceability may be limited by applicable bankruptcy, reorganization,
insolvency, moratorium or other similar laws affecting creditors' rights
generally, now or hereafter 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) by the Trustee upon such creation. Upon the
filing of the appropriate financing statements and, in the case of
Receivables hereafter created and the proceeds thereof, upon the creation
thereof and payment therefor, the Trust shall have an ownership or first
priority perfected security interest in those Trust Assets (except for
perfection outside of Connecticut in respect of returned merchandise) and
the proceeds thereof in which a
Pooling and Servicing Agreement
33
security interest may be perfected by filing appropriate financing
statements. The Transferor has caused the Servicer to clearly and
unambiguously xxxx all its computer records and all its microfiche storage
files, if any, in a manner reasonably calculated to indicate that the
Trust Assets are the property of the Trust and shall cause the Servicer to
maintain such records in a manner such that the Trust's perfected first
priority interest in the Receivables shall not be adversely affected.
(b) No Claim or Interest. Except as otherwise provided in this
Agreement or any applicable Supplement, neither the Transferor nor any
Person claiming through or under the Transferor has any claim to or
interest in the Concentration Account, the Xxxxxxxxxx Collection Accounts
or any Series Account. Each Receivable and the Collections with respect
thereto has been or will be transferred to the Trust free and clear of any
adverse claim or interest of any other Person (other than disputes with
Obligors in the ordinary course of business or in connection with an
Insolvency Event of the related Obligor) not holding through the Trust.
(c) Outstanding Balance; Net Receivables Balance. As of the Initial
Issuance Date for any Series, the Net Receivables Balance is at least
equal to the Required Net Receivables Balance.
(d) Liens. Each Receivable and all other Trust Assets have been
Transferred to the Trust free and clear of any Lien except as created
hereby or by the Receivables Purchase Agreements.
(e) Eligibility. Each Receivable was purchased in accordance with
the terms of the Receivables Purchase Agreements and each Receivable that
was classified as an "Eligible Receivable" by the Transferor in any
document or report delivered hereunder satisfied, at the time of such
classification, the requirements of eligibility contained in the
definition of Eligible Receivable.
(f) Investment Company Act. Each Transfer of Receivables to the
Trust hereunder constitutes a purchase or other acquisition of notes,
drafts, acceptances, open accounts receivable or other obligations
representing part or all of the sales price of merchandise or services
within the meaning of Section 3(c)(5) of the Investment Company Act.
(g) Collection Accounts and Post Office Boxes. The Xxxxxxxxxx
Collection Account Banks are the only institutions holding Xxxxxxxxxx
Collection Accounts for the receipt of payments from Xxxxxxxxxx Post
Office Boxes in respect of Receivables (subject to such changes as may be
made from time to time in accordance herewith) and all Obligors, and only
such Obligors, have been instructed or, upon the creation of Receivables,
will be instructed to make payments only to Xxxxxxxxxx Collection
Pooling and Servicing Agreement
34
Accounts and such instructions have not been modified or revoked by the
Transferor and such instructions that have been given are in full force
and effect.
(h) No Rescission. Neither any Receivable transferred hereunder nor
any Contract giving rise to any such Receivable has been satisfied,
subordinated or rescinded or, except as disclosed in writing to the
Trustee or otherwise permitted hereunder, amended in any manner and such
Receivables have not, except as permitted hereunder, been compromised,
adjusted, extended, satisfied, subordinated, rescinded or modified.
(i) No Payment. The Transferor has no knowledge of any fact which
would lead it to reasonably expect that, when billed, any Receivable
transferred hereunder would not be paid in accordance with its terms when
due.
(j) Offering of Certificates. Neither the Transferor nor any agent
acting on its behalf has, directly or indirectly, offered any Certificate
or any similar security of the Transferor for sale to, or solicited any
offer to buy any Certificate or any similar security of the Transferor
from, or otherwise approached or negotiated with respect thereto, with any
Person which, and neither the Transferor nor any agent acting on its
behalf has taken or will take any action which, would subject the issuance
or sale of any Certificate to the provisions of Section 5 of the Act or to
the qualification provisions of any securities or blue sky law of any
applicable jurisdiction.
In the event of a breach with respect to any Receivable of the
representation and warranty set forth in Section 2.04(e) on the date of Transfer
for such Receivable (a) which cannot be cured by the Business Day following the
first day on which a Responsible Officer of the Transferor has knowledge thereof
and (b) which causes the Net Receivables Balance to be less than the Required
Net Receivables Balance, the Transferor shall repurchase such Receivable (a
"Reconveyed Receivable") from the Trust such that the payment for such
Reconveyed Receivable is sufficient to cause the Net Receivables Balance to be
equal to or greater than the Required Net Receivables Balance. The Servicer
shall deduct the unpaid balance of such Reconveyed Receivable from the balance
of Eligible Receivables in the Trust and on and after the date of such removal,
such Reconveyed Receivable shall not be included in the calculation of the Net
Receivables Balance. As payment for such Reconveyed Receivable, the Transferor
shall make or cause to be made a deposit in the Cure Account of each outstanding
Series in immediately available funds in an amount equal to the ratable share
for such Series (determined pursuant to Section 4.03) of the aggregate of the
unpaid principal balance of such Reconveyed Receivable. The Transferor shall
make such deposits, or cause such deposits to be made, by the close of business
on the Business Day following the day a Responsible Officer of the Transferor
obtains knowledge of the existence of such Reconveyed Receivable. Such deposits
shall be considered payment in full for such Reconveyed Receivable during the
Collection Period in which such payment occurs. Upon the written
Pooling and Servicing Agreement
35
instruction of the Servicer, Collections related to Reconveyed Receivables shall
be withdrawn from the Cure Account and deposited by the Trustee to the
Transferor Account. At the option and expense of the Servicer or the Transferor,
the Trustee shall execute such documents and instruments of transfer or
assignment as shall be prepared by the Transferor or the Servicer, and shall
take such other actions as shall reasonably be requested by the Transferor, to
effect the removal of such Reconveyed Receivable from the Trust pursuant to this
paragraph. Upon removal of a Reconveyed Receivable from the Trust, the Trustee
shall automatically and without further action be deemed to transfer, assign,
set-over and otherwise convey to or upon the order of the Transferor, without
recourse, representation or warranty, all the right, title and interest of the
Trust in and to such Reconveyed Receivable and Collections with respect thereto
and all proceeds thereof. The obligation of the Transferor set forth in this
paragraph shall constitute the sole remedy respecting any breach of the
representations and warranties set forth in this Section 2.04(e) made on the
date of Transfer of and with respect to such Receivable available to the
Investor Certificateholders (or the Trustee on behalf of the Investor
Certificateholders) or any other Indemnified Party.
The representations and warranties set forth in this Section 2.04
shall survive the Transfer of the Receivables to the Trust and the issuance of
the Certificates, and shall cease and be of no effect upon the indefeasible
repayment in full of the Invested Amount of the last outstanding Series and all
other obligations of the Transferor hereunder. Upon discovery by the Transferor,
the Servicer or the Trustee of a breach of any of the foregoing representations
and warranties, the party discovering such breach shall give prompt written
notice to the other parties and to any Enhancement Provider. The Trustee's
obligations in respect of any such breach are limited as provided in Section
11.02(g).
SECTION 2.05. Affirmative Covenants of the Transferor. The
Transferor hereby covenants and agrees that, until termination of the Trust:
(a) Compliance with Law. The Transferor shall duly satisfy all
obligations on its part to be fulfilled under or in connection with the
Receivables, will maintain in effect all qualifications required under
Requirement of Law in order to properly purchase and convey the
Receivables and other Trust Assets to the Trust and will comply in all
respects with all Requirements of Law applicable to the Transferor, its
business and properties and the Trust Assets, where failure to so comply
would have an adverse effect on the Trust Assets or the ability of the
Transferor to perform its obligations hereunder or under the Receivables
Purchase Agreements.
(b) Preservation of Legal Existence. The Transferor will preserve
and maintain its legal existence, rights, franchises and privileges in the
jurisdiction of its formation, and qualify and remain qualified in each
jurisdiction where the failure to maintain such qualification could
materially adversely affect (i) the interests of the Trustee or of the
Investor Certificateholders hereunder or in the Trust Assets, (ii) the
Pooling and Servicing Agreement
36
collectibility of any Receivable or (iii) the ability of the Transferor or
the Servicer to perform its obligations hereunder or under the Receivables
Purchase Agreements.
The Transferor shall provide to the Trustee access to the
documentation regarding the Receivables in such cases where the Trustee is
required in connection with the enforcement of the rights of
Certificateholders or by applicable statutes or regulations to review such
documentation, such access being afforded without charge and at the sole
cost of the Transferor but only (i) upon reasonable written request, (ii)
during normal business hours, (iii) subject to the Transferor's normal
security and confidentiality procedures and (iv) at reasonably accessible
offices in the continental United States designated by the Transferor.
(c) Keeping of Records and Books of Account. The Transferor will (i)
keep proper books of record and account, which shall be maintained or
caused to be maintained by the Transferor and shall be separate and apart
from those of any Affiliate of the Transferor, in which full and correct
entries shall be made of all financial transactions and the assets and
business of the Transferor in accordance with generally accepted
accounting principles consistently applied, (ii) maintain and implement
administrative and operating procedures (including, without limitation,
the ability to recreate records evidencing the Receivables in the event of
the destruction of the originals thereof) and (iii) keep and maintain all
documents, books, records and other information necessary or reasonably
advisable for the collection of all Receivables (including, without
limitation, records adequate to permit the daily identification of each
new Receivable and all Collections of and adjustments to each existing
Receivable).
(d) Location of Records. The Transferor will keep its chief place of
business, chief executive office and the office where it keeps the books,
records and documents regarding the Receivables and the other Trust Assets
at the address of the Transferor referred to in Section 13.04; provided,
however, that the Transferor may change any such address if the Transferor
delivers to the Trustee (i) written notice of such change at least 30 days
prior to the effective date thereof, and (ii) prior to the effective date
thereof, an Opinion of Counsel, in form and substance satisfactory to the
Trustee, as to such organization and the Transferor's valid existence and
good standing and the continued perfection of the interests of the Trustee
in and to the Receivables and other Trust Assets conveyed hereby (to the
same extent as such interest was perfected or required hereby to be
perfected on the Transfer Date with respect to the Receivables then owned
by the Transferor) and (ii) such financing statements (Forms UCC-1 and
UCC-3) executed by the Transferor required to reflect such change,
together with such documents and instruments required in connection
therewith to monitor the continued perfection of the interests of the
Trustee.
Pooling and Servicing Agreement
37
(e) Maintenance of Separate Directors. The Transferor will maintain
at least two independent directors who are not officers, directors,
shareholders (holding, with respect to Mobil Corporation only, more than a
1% interest in) or employees of (i) Xxxxxxxxxx, the Transferor or Mobil
Corporation or (ii) any Affiliate of Xxxxxxxxxx, the Transferor or Mobil
Corporation, or a parent, child, spouse or sibling of any such Person;
provided, however, that if either such independent director dies or
resigns, the Transferor shall have 30 Business Days to replace that Person
with another independent director. The Transferor will not, without the
consent of the two independent directors, acquiesce, petition or otherwise
invoke the process of any Governmental Authority for the purpose of
commencing or sustaining a case against the Transferor under any federal
or state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar
official of the Transferor or any substantial part of its property or
ordering the winding-up or liquidation of the affairs of the Transferor.
(f) Payment of Taxes, Etc. The Transferor will pay promptly when due
all taxes, assessments and governmental charges or levies imposed upon it
or any Trust Asset, or in respect of its income or profits therefrom, and
any and all claims of any kind, except that no such amount need be paid if
(i) such nonpayment could not reasonably be expected to subject any
Indemnified Party to civil or criminal penalty or liability or involve any
risk of the sale, forfeiture or loss of any of the property, rights or
interests covered hereunder or under any Supplement or under any
Receivables Purchase Agreement and (ii) the charge or levy is being
contested in good faith through appropriate proceedings as to which
adequate reserves are being maintained and no Lien with respect thereto
has attached to its property and become enforceable against its creditors.
(g) Reporting Requirements. The Transferor will:
(i) within one Business Day after a Responsible Officer of the
Transferor obtains knowledge of the occurrence of any Trust Early
Amortization Event, the commencement of a Partial Amortization
Period or Cure Period or any event which, with the giving of notice
or lapse of time or both, would constitute a Trust Early
Amortization Event, notify (either orally or in writing) the Trustee
of such occurrence;
(ii) as soon as possible and in any event (A) within three
Business Days after a Responsible Officer of the Transferor obtains
knowledge of the occurrence of any Trust Early Amortization Event,
the commencement of a Partial Amortization Period or Cure Period, or
any event which, with the giving of notice or lapse of time or both,
would constitute a Trust Early Amortization Event, furnish to the
Trustee, each Rating Agency and each Enhancement
Pooling and Servicing Agreement
38
Provider the written statement of a Responsible Officer setting
forth details of such Trust Early Amortization Event, the
commencement of such Partial Amortization Period or Cure Period or
such event and the action which the Transferor has taken and
proposes to take with respect thereto, and (B) within three Business
Days after a Responsible Officer obtains knowledge thereof, give
written notice to the Trustee, each Rating Agency and each
Enhancement Provider of any other event, development or information
which is reasonably likely to materially and adversely affect the
ability of the Transferor to perform its obligations under this
Agreement or the Receivables Purchase Agreements;
(iii) promptly, from time to time, furnish to the Trustee such
other information, documents, records or reports regarding the
Receivables, the other Trust Assets or the condition or operations,
financial or otherwise, of the Transferor as the Trustee may from
time to time reasonably request;
(iv) within thirty (30) days after the end of each fiscal
month in each Fiscal Year, deliver to the Trustee, each Rating
Agency and each Enhancement Provider the consolidated balance sheets
of the Transferor and its Subsidiaries as at the end of such period
and the related consolidated statements of income and cash flow of
the Transferor and its Subsidiaries for such fiscal month and for
the period from the beginning of the then current Fiscal Year to the
end of such fiscal month, and for the corresponding period during
the previous Fiscal Year, and a comparison of the statement of the
year to date earnings and cash flow to the corresponding statement
for the corresponding period from the previous Fiscal Year certified
by a Financial Officer of the Transferor as fairly presenting the
consolidated financial position of the Transferor and its
Subsidiaries as at the dates indicated and the results of their
operations and cash flow for the periods indicated in accordance
with GAAP, subject to normal year end adjustments;
(v) within ninety (90) days after the end of each Fiscal Year
deliver to the Trustee and each Rating Agency audited consolidated
financial statements of the Transferor and its Subsidiaries reported
on by independent certified public accountants of recognized
national standing acceptable to the Majority in Interest, which
report shall be unqualified (or, if qualified, only as to
non-material matters) and shall state that such financial statements
fairly present the consolidated financial position of the Transferor
and its Subsidiaries as at the dates indicated in conformity with
GAAP applied on a basis consistent with prior years (except for
changes with which such independent certified public accountants
shall concur and which shall have been disclosed in the notes to the
financial statements) and that the examination by such accountants
in connection with such consolidated financial statements has been
made in accordance with generally accepted auditing standards; and
Pooling and Servicing Agreement
39
(vi) as soon as possible and in any event within 30 days after
a Responsible Officer of the Transferor obtains knowledge that one
of the following events has occurred or is reasonably expected to
occur: (i) the occurrence of any Plan Event with respect to any Plan
or (ii) the withdrawal by the Transferor or any of its ERISA
Affiliates from, or the termination, reorganization or insolvency
of, any Multiemployer Plan.
(h) Receivables Purchase Agreements. The Transferor will at its
expense timely perform and comply with all provisions, covenants and other
promises required to be observed by it under the Receivables Purchase
Agreements, maintain the Receivables Purchase Agreements in full force and
effect, enforce its rights under the Receivables Purchase Agreements
substantially in accordance with the terms thereof and comply with its
obligations under all contracts and invoices giving rise to Receivables.
The Transferor shall, within one Business Day after a Responsible Officer
obtains knowledge of the occurrence of any Termination Event or any event
which, with the giving of notice or lapse of time or both, would
constitute a Termination Event, notify the Trustee in writing of such
occurrence. The Transferor shall promptly furnish to the Trustee copies of
any notices, reports or certificates given or delivered to the Transferor
under the Receivables Purchase Agreements.
(i) UCC Opinion. The Transferor shall deliver to the Trustee within
90 days after the end of each fiscal year, beginning with December 31,
1997, an Opinion of Counsel to the Transferor (who may be counsel employed
by the Transferor or an Affiliate of the Transferor), dated as of a date
during such 90-day period, substantially to the effect that, in the
opinion of such counsel, either (A) such action has been taken with
respect to the recording, registering, filing, re-recording,
re-registering and re-filing of financing statements, continuation
statements or other instructions or documents as is necessary to continue
the perfection of the interests of the Trustee in and to the Receivables
conveyed hereby and the other Trust Assets conveyed hereunder (to the same
extent as such interest was perfected on the Transfer Date with respect to
the Receivables and other Trust Assets then owned by the Transferor) and
reciting the details of such action or referring to prior Opinions of
Counsel in which such details are given or (B) no such action is necessary
to continue the perfection of such interests.
(j) Further Action. The Transferor shall, from time to time, execute
and deliver to the Trustee any instruments, financing or continuation
statements or other writings necessary to maintain the perfection or
priority of the Trustee's ownership or security interest in the
Receivables and the Collections under the UCC or other applicable law. The
Transferor shall, from time to time, execute and deliver to the Obligors
on the Receivables any bills, statements and letters or other writings
necessary to carry out the terms and provisions of this Agreement and to
facilitate the collection
Pooling and Servicing Agreement
40
of the Receivables in a manner consistent with the Muehlstein Credit
Policy Manual.
(k) Special Purpose Covenants. The Transferor shall conduct its
affairs in a manner at all times consistent with the assumptions set forth
in Parts III through VI, inclusive, of the opinion of Messrs. XxXxxxxxx,
Will & Xxxxx delivered pursuant to Section 3.01(a)(vii) of each of the
Receivables Purchase Agreements; provided that any references therein to
any agreements shall refer to such agreements as amended, restated,
refinanced, supplemented or otherwise modified from time to time.
SECTION 2.06. Negative Covenants of the Transferor. The Transferor
hereby further covenants that, unless it shall have received the written consent
of a Majority in Interest of each outstanding Series and the Rating Agency
Condition (for which the applicable Enhancement Provider shall not have
unreasonably withheld its consent) shall have been satisfied, until termination
of the Trust:
(a) No Liens. Except for the Transfer hereunder the Transferor will
not sell, pledge, assign or transfer any Receivable or any interest
therein or any other Trust Asset to any other Person, or grant, create,
incur, assume or suffer to exist any Lien on, any Trust Asset or any other
property or asset of the Transferor (other than the Transferor
Certificate, any Supplemental Certificate and funds deposited to the
Transferor's Account pursuant to the applicable Supplement or the
Transferor Certificate), whether now existing or hereafter created, or any
interest therein, and the Transferor shall defend the right, title and
interest of the Trust in and to the Trust Assets, whether now existing or
hereafter created, against all claims of third parties claiming through or
under the Transferor.
(b) Activities of the Transferor. The Transferor will not engage in,
enter into or be a party to any business, activity or transaction of any
kind other than the businesses, activities and transactions contemplated
and authorized by this Agreement or the Receivables Purchase Agreements or
any document related hereto or thereto or incidental to its ability to
carry out its obligations under such agreements.
(c) Indebtedness. Except for the Subordinated Notes, the Transferor
will not create, incur or assume any Indebtedness (other than Indebtedness
related to operating expenses incurred in the performance of or incidental
to its obligations under this Agreement which shall not exceed $100,000
per annum) or sell or transfer any Receivable to a trust or other Person
which issues securities in respect of any such Receivables, other than as
contemplated by the Transaction Documents.
(d) Guarantees. Except as provided herein, the Transferor will not
become or remain liable, directly or indirectly, in connection with any
Indebtedness or other liability of any other Person, whether by guarantee,
endorsement (other than
Pooling and Servicing Agreement
41
endorsements of negotiable instruments for deposit or collection in the
ordinary course of business), agreement to purchase or repurchase,
agreement to supply or advance funds, or otherwise.
(e) Investments. The Transferor will not make or suffer to exist any
loans or advances to, or extend any credit to, or make any investments (by
way of transfer of property, contributions to capital, purchase of stock
or securities or evidences of indebtedness, acquisition of the business or
assets, or otherwise) in, any of its Affiliates or any other Person except
for purchases of Receivables pursuant to the terms of the Receivables
Purchase Agreements, investments in Eligible Investments in accordance
with the terms of this Agreement and holding the Transferor Certificate.
(f) Extension or Amendment of Receivables. The Transferor will not
extend, amend or otherwise modify (or consent or fail to object to any
such extension, amendment or modification by the Servicer), except as
permitted in Section 3.01(c), the terms of any Receivable, or amend,
modify or waive (or consent or fail to object to any such amendment,
modification or waiver by the Servicer) any payment term or condition of
any invoice related thereto (other than as provided in the Muehlstein
Credit Policy Manual) if the effect of such amendment, modification or
waiver would impair the collectibility or delay the payment of any then
existing Receivable beyond 120 days from the date of the invoice. The
Transferor will not rescind or cancel, or permit the rescission or
cancellation of, any Receivable except as ordered by a court of competent
jurisdiction or other Governmental Authority. Notwithstanding the
foregoing provisions of this Section 2.06(f), each of the Transferor and
the Servicer may extend, amend, modify, cancel or rescind (and the
Transferor need not object to any such action by the Servicer) any Diluted
Receivable in connection with a valid dispute; provided, however, that
such amendment, modification, cancellation or rescission shall not have a
material adverse effect on the interests of any Beneficiary.
(g) Change in Legal Name. The Transferor will not (i) make any
change to its legal name, identity or business structure in any manner or
chief executive office or use any trade names, fictitious names, assumed
names or "doing business as" names unless, prior to the effective date of
any such name change, change in chief executive office, or use, the
Transferor delivers to the Trustee such financing statements (Forms UCC-1
and UCC-3) executed by the Transferor required to reflect such name
change, change in chief executive office, or use, together with such other
documents and instruments required in connection therewith to maintain the
continued perfection of the interests of the Trustee, or (ii) change its
jurisdiction of organization unless the Trustee shall have received from
the Transferor (A) written notice of such change at least 30 days prior to
the effective date thereof, and (B) prior to the effective date thereof,
an Opinion of Counsel, in form and substance satisfactory to the Trustee,
as to such organization and the Transferor's valid existence and good
standing and the continued
Pooling and Servicing Agreement
42
perfection of the interests of the Trustee in and to the Receivables and
other Trust Assets conveyed hereby (to the same extent as such interest
was perfected on the Transfer Date with respect to the Receivables then
owned by the Transferor).
(h) Receivables Purchase Agreements. The Transferor will not (i)
cancel or terminate the Receivables Purchase Agreements or consent to or
accept any cancellation or termination thereof, (ii) amend or otherwise
modify any term or condition of the Receivables Purchase Agreements or
give any consent, waiver or approval thereunder, (iii) waive any default
under or breach of the Receivables Purchase Agreements or (iv) take any
other action under the Receivables Purchase Agreements not contemplated or
required by the terms thereof.
(i) Organization. The Transferor will not amend its certificate of
incorporation or bylaws.
(j) Maintenance of Separate Existence. The Transferor will not (i)
fail to do all things necessary to maintain its existence as a corporation
separate and apart from the Servicer, Xxxxxxxxxx International,
Muehlstein, any Affiliate of Muehlstein, and any Affiliate of the
Transferor including, without limitation, conducting business
correspondence in its own name and maintaining appropriate and separate
books, records and financial statements; (ii) suffer any limitation on the
authority of its own directors and officers to conduct its business and
affairs in accordance with their independent business judgment, or
authorize or suffer any Person other than its own directors and officers
to act on its behalf with respect to matters (other than matters
customarily delegated to others under powers of attorney) for which a
corporation's own directors and officers would customarily be responsible;
(iii) fail to (A) maintain or cause to be maintained by an agent of the
Transferor under the Transferor's control physical possession of all its
books and records, (B) maintain capitalization adequate for the conduct of
its business, (C) account for and manage its liabilities separately from
those of any other Person, including, without limitation, payment of all
payroll and other administrative expenses and taxes from its own assets,
(D) segregate and identify separately all of its money and assets from
those of any other Person (including, but not limited to, maintaining
separate bank accounts in its own name), and (E) maintain offices through
which its business is conducted separate from those of the Servicer,
Xxxxxxxxxx International, Muehlstein, any Affiliate of Muehlstein and any
Affiliate of the Transferor (provided that, to the extent that the
Transferor and any of its Affiliates have offices in the same location,
there shall be a fair and appropriate allocation of overhead costs and
expenses among them, and each such entity shall bear its fair share of
such costs and expenses and each such office shall be conspicuously
identified as the office of such entity); (iv) commingle its money or
other assets with those of the Servicer, Xxxxxxxxxx International,
Muehlstein, any Affiliate of Muehlstein or any Affiliate of the
Transferor, or use its funds for other than the Transferor's uses; (v)
fail
Pooling and Servicing Agreement
43
to (A) maintain its books, financial statements, accounting records and
other business documents and records separate from those of the Servicer,
Xxxxxxxxxx International, Muehlstein and each other Person, (B) act solely
in its legal name and through its own authorized officers and agents, (C)
make investments directly or by brokers engaged and paid by the Transferor
or its agents (provided that if any such agent is an Affiliate of the
Transferor it shall be compensated at a fair market rate for its
services), (D) separately manage its liabilities from those of the
Servicer, Xxxxxxxxxx International, Muehlstein or any Affiliate of
Muehlstein and pay its own liabilities, including all administrative
expenses, from its own separate assets (provided that, to the extent the
employees of the Transferor participate in pension, insurance and other
benefit plans of Muehlstein or any Affiliate thereof, the Transferor will
reimburse Muehlstein or such Affiliate, as the case may be, for an
appropriate share of the costs thereof), (E) pay from its assets all
obligations and indebtedness of any kind incurred by it and (F) abide by
all corporate legal formalities, including the maintenance of current
corporate records; (vi) assume the liabilities of the Servicer, Xxxxxxxxxx
International, Muehlstein or any Affiliate of Muehlstein; (vii) guarantee
the liabilities of the Servicer, Xxxxxxxxxx International, Muehlstein or
any Affiliate of Muehlstein; (viii) be involved in the day-to-day
management of the Servicer, Xxxxxxxxxx International, or Muehlstein; (ix)
act as agent of the Servicer, Xxxxxxxxxx International,
Muehlstein or any Affiliate of Muehlstein or allow the Servicer,
Xxxxxxxxxx International, Muehlstein or any Affiliate of Muehlstein to act
as its agent (other than as Servicer hereunder or pursuant to a contract
on terms no less favorable to the Transferor than it would have obtained
in a similar contract with a Person not an Affiliate of the Transferor);
(x) make any advances to the Servicer, Xxxxxxxxxx International,
Muehlstein or any Affiliate of Muehlstein; (xi) have insufficient officers
and personnel to conduct its business and operations; (xii) enter into
business transactions with any of its Affiliates unless the terms are not
more or less favorable to the Transferor than terms and conditions
available at the time to the Transferor for comparable transactions with
unaffiliated persons and a majority of the board of directors of the
Transferor including each director who is an independent director approve
the transaction; (xiii) if the Transferor is included within the
consolidated financial statements of Muehlstein or any Affiliate thereof,
fail to disclose in a note in the financial reports required to be
delivered quarterly and annually the existence of the Transferor as a
separate legal entity and the participation of the Transferor in the
transactions contemplated by the Transaction Documents; or (xiv) fail to
establish investment guidelines and criteria by a majority of the board of
directors including at least two directors who are independent directors.
(k) Ownership; Merger. The Transferor will not (i) sell any shares
of any class of its capital stock to any Person (other than Muehlstein or
any of its Controlled Affiliates), or enter into any transaction of merger
or consolidation, or convey or otherwise dispose of all or substantially
all of its assets (except as contemplated herein),
Pooling and Servicing Agreement
44
or (ii) terminate, liquidate or dissolve itself (or suffer any
termination, liquidation or dissolution), or (iii) acquire or be acquired
by any Person, except indirectly in connection with a consolidation or
merger of Muehlstein with any of its Controlled Affiliates, in connection
with which the Trustee shall have received an Opinion of Counsel, which
counsel shall not be an employee of the Transferor, Muehlstein or any of
their respective Affiliates, that such consolidation or merger does not
affect the separate existence of the Transferor.
SECTION 2.07. Addition and Removal of Originators. (a) At any time
following the Transfer Date, the Transferor may designate any Affiliate of
Muehlstein or any division of (1) Xxxxxxxxxx International, or (2) any other
Affiliate of Muehlstein as an Originator (an "Additional Originator"); provided
that the following conditions are satisfied: (A) either (i) the average of the
aggregate Outstanding Balance of all Receivables generated by such Additional
Originator as of the last day of each of the immediately preceding twelve months
does not exceed 5% of the average of the aggregate Outstanding Balance of
Eligible Receivables owned by the Trust as of the last day of each of such
twelve months or (ii) the Rating Agency Condition (for which the applicable
Enhancement Provider shall not have unreasonably withheld its consent) shall
have been satisfied, (B) such Additional Originator shall be subject to the
provisions of the Parent Undertaking Agreement and shall become a party to such
Transaction Documents as the Trustee shall reasonably request and (C) Xxxxxxxxxx
International or Muehlstein, as the case may be, shall guarantee all obligations
of such Additional Originator pursuant to the Transaction Documents.
(b) The Transferor may cause any Originator to no longer be
designated as an Originator (being a "Removed Originator"), and the Transferor
shall cease purchasing Receivables from such Removed Originator, provided that
(i) the average of the aggregate Outstanding Balance of Receivables generated by
such Removed Originator as of the last day of each of the immediately preceding
twelve months does not exceed 5% of the average of the aggregate Outstanding
Balance of Eligible Receivables owned by the Trust as of the last day of each of
such twelve months, (ii) the Transferor provides timely written notice of such
change in designation to each Rating Agency, (iii) the Rating Agency Condition
(for which the applicable Enhancement Provider shall not have unreasonably
withheld its consent) shall have been satisfied and (iv) the Transferor shall
have delivered to the Trustee and any Enhancement Provider an Officer's
Certificate stating that the Transferor reasonably believes that the removal of
such Removed Originator will not result in the occurrence of a Trust Early
Amortization Event.
(c) Notwithstanding anything in this Section 2.07 to the contrary, a
consent by the Majority in Interest of each outstanding Series to changes in the
foregoing subsections (a) and (b) hereof shall be effective only if (i) the
Rating Agency Condition (for which the applicable Enhancement Provider shall not
have unreasonably withheld its consent) shall be satisfied and (ii) written
notice thereof has been given to the Trustee.
Pooling and Servicing Agreement
45
ARTICLE III
ADMINISTRATION AND SERVICING OF RECEIVABLES
SECTION 3.01. Acceptance of Appointment and Other Matters Relating
to the Servicer. (a) Muehlstein agrees to act as the Servicer for the benefit of
the Certificateholders under this Agreement (subject to Article X) and the
Certificateholders by their acceptance of the Certificates consent to Muehlstein
so acting as Servicer.
(b) The Servicer shall (subject to Article X) enforce its respective
rights and interests in, to and under the Receivables and the other Trust Assets
on behalf of the Trust. The Servicer shall service, administer and collect the
Receivables and, in connection therewith, the Servicer shall take or cause to be
taken all such actions as may be necessary or advisable to collect each
Receivable from time to time, all in accordance with applicable laws, rules and
regulations, with reasonable care and diligence, and in accordance with the
Muehlstein Credit Policy Manual; provided, however, that in the event the
Trustee is acting as Servicer hereunder, it shall service the Receivables in
accordance with customary industry standards in effect from time to time.
(c) Provided that no Trust Early Amortization Event or Servicer
Default shall have occurred and be continuing, and no Partial Amortization
Period shall have commenced and be continuing, the Servicer may, in accordance
with the Muehlstein Credit Policy Manual, extend the maturity, adjust the
Outstanding Balance, or otherwise modify the terms of any Defaulted Receivable
or amend, modify or waive any payment term or condition of any invoice related
thereto, all as it may determine to be appropriate to maximize Collections
thereof; provided that, for all purposes hereunder, any such Receivable shall
remain a "Defaulted Receivable" in the amount of its Outstanding Balance
(without giving effect to any such extension, adjustment, amendment,
modification or waiver) until paid in full or charged off as uncollectible.
(d) 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, subject to the terms and conditions of this Agreement
and the applicable Supplement. Without limiting the generality of the foregoing
and subject to Section 10.01 and any limitations provided in any Supplement, the
Servicer or its designee is hereby authorized and empowered (i) to instruct the
Trustee to make withdrawals and payments from the Concentration Account, subject
to the limitations set forth in Section 4.02(a) and as otherwise set forth in
this Agreement, (ii) to instruct the Trustee to make withdrawals and payments
from the Series Accounts, subject to the limitations set forth in the related
Supplement and as otherwise set forth in this Agreement,
Pooling and Servicing Agreement
46
(iii) to instruct the Trustee to take any action required or permitted under any
Enhancement, (iv) to make any filings, reports, notices, applications and
registrations with, and to seek any consents or authorizations from, the
Securities and Exchange Commission and any state securities authority on behalf
of the Trust as may be necessary or advisable to comply with any federal or
state securities laws or reporting requirements, and (v) only (A) with the prior
consent of a Majority in Interest of each outstanding Series and (B) upon
satisfaction of the Rating Agency Condition (for which the applicable
Enhancement Provider shall not have unreasonably withheld its consent), to
subcontract with any other Person (excluding the Transferor and, so long as
Muehlstein shall be the Servicer, any wholly-owned Subsidiary of Muehlstein) (at
the Servicer's expense) for servicing, administering or collecting the
Receivables; provided that such Person shall not become Servicer hereunder and
the Servicer shall remain liable for the performance of the duties and
obligations of the Servicer pursuant to the terms hereof. The Trustee shall
execute any documents furnished by the Servicer which are necessary or
appropriate to enable the Servicer to carry out its servicing administrative
duties hereunder and acceptable in form and substance to the Trustee. The
Trustee shall, upon the written request of the Servicer, furnish the Servicer
with any documents then in the Trustee's possession which are necessary or
appropriate to enable the Servicer to carry out its servicing and administrative
duties hereunder.
(e) The Servicer shall not, and no Successor Servicer shall be
obligated to, use servicing procedures, offices, employees or accounts for
servicing the Receivables which differ in any material respect 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 trade
receivables or its business in general.
(f) The relationship of the Servicer (and of any Successor Servicer
under this Agreement) to the Trustee under this Agreement is intended by the
parties to be that of an independent contractor to or with the Trust and shall
not be construed to be that of a joint venturer, partner, or agent, such that
the acts of the Servicer (or any Successor Servicer) are in any way vicariously
attributable to the Trustee in its individual capacity prior to such time as the
Trustee may serve as Servicer pursuant to the provisions of Article X.
Pooling and Servicing Agreement
47
SECTION 3.02. Servicing Compensation; Servicer's Expenses. (a)
Compensation. As full compensation for its servicing activities hereunder, the
Servicer shall be entitled to receive a monthly servicing fee (the "Servicing
Fee") for each Collection Period (or portion thereof) from the Initial Issuance
Date for each Series until the termination of the Amortization Period, payable
in arrears on the Distribution Date with respect to such Collection Period (or
portion), in an amount equal to the aggregate of the Series Servicing Fees
specified in the Supplements. The Servicing Fee shall be payable only from
Investor Collections pursuant to, and subject to the priority of payment set
forth in, the Supplements; provided, however, that if the Trustee is appointed
Successor Servicer, and Investor Collections are insufficient to pay the
Servicing Fee in full, the Trustee may seek payment of the Servicing Fee from
Muehlstein under the Parent Undertaking Agreement.
(b) Expenses. The Servicer's expenses include the Trustee's Fee (to
the extent not paid from Collections) and all documented reasonable expenses and
liabilities (other than any liability of the Trust with respect to any amount
payable solely out of Collections or any personal liability of the Trust to
repay the Certificates) of the Trust not expressly stated herein to be for the
account of the Certificateholders, including, without limitation, reasonable
expenses related to enforcement of the Receivables and the other amounts due to
the Trustee pursuant to Section 11.05, the reasonable fees and disbursements of
the Independent Public Accountants in connection with this Agreement, any
Supplement and the Receivables Purchase Agreements, and other reasonable fees
and documented expenses including but not limited to the costs of filing UCC
continuation statements; provided that in no event shall the Servicer be liable
for any federal, state or local income or franchise tax, or any interest or
penalties with respect thereto, assessed on the Trust, the Trustee or the
Certificateholders except as expressly provided in Section 7.03(d)(ix). Such
expenses shall be payable, first, by the Servicer out of the Servicing Fee,
second, to the extent not paid by the Servicer, by the Transferor for its own
account, and third, to the extent the Transferor shall fail to pay any of such
expenses, by the Servicer for its own account, and the Servicer shall not be
entitled to any payment for any such expenses other than the Servicing Fee and
reimbursement from the Transferor. In addition, to the extent not paid from the
Servicing Fee, the Transferor shall pay for its own account, and, if the
Transferor fails to do so, the Servicer will pay, all fees and expenses incurred
by or on behalf of the Servicer in connection with its servicing activities
hereunder (including, without limitation, expenses related to enforcement of the
Receivables and the costs of a Service Transfer) or otherwise in connection
herewith (including, without limitation, the fees and expenses set forth above),
and the Servicer will not be entitled to any fee or other payment from, or claim
on, any of the Trust Assets (other than the Servicing Fee and reimbursement from
the Transferor). The Transferor's and Servicer's covenant to pay the expenses
and disbursements provided in this Section 3.02(b) shall survive the termination
of the Trust.
SECTION 3.03. Representations and Warranties of the Servicer.
Muehlstein, as initial Servicer, hereby represents and warrants, and each
Successor Servicer (except for the
Pooling and Servicing Agreement
48
Trustee in such capacity) by acceptance of its appointment hereunder shall
represent and warrant, in the case of the initial Servicer as of the date hereof
and as of the Transfer Date, and, with respect to any Series, as of the date of
the related Supplement and the related Initial Issuance Date or, in the case of
any Successor Servicer, the date of such appointment and, with respect to any
Series issued after such date, as of the date of the related Supplement and the
related Initial Issuance Date, in each case unless otherwise stated in such
Supplement:
(a) Organization. The Servicer is a corporation duly organized and
validly existing under the applicable laws of New York and has full power,
authority and legal right to own its properties and conduct its business
including its receivables servicing business as such properties are
presently owned and as such business is presently conducted and as is
proposed to be conducted under the Transaction Documents, and to execute,
deliver and perform its obligations under the Transaction Documents.
(b) Due Qualification. The Servicer is duly qualified to do business
(or is exempt from such requirements), and has obtained all necessary
licenses and approvals, in each jurisdiction in which the servicing of the
Receivables in accordance with the terms of the Transaction Documents
requires such qualification, except where failure to so qualify or to
obtain such licenses or approvals would not have a material adverse effect
upon a Beneficiary or on the Servicer's ability to perform its obligations
as Servicer under the Transaction Documents.
(c) Due Authorization. The Servicer's execution, delivery and
performance of the Transaction Documents to which it is a party and the
other agreements and instruments executed or to be executed by the
Servicer as contemplated hereby or thereby, and the consummation of the
transactions contemplated by the Transaction Documents, have been duly and
validly authorized by all necessary action on the part of the Servicer.
(d) Binding Obligation. Each of the Transaction Documents to which
it is a party constitutes a legal, valid and binding obligation of the
Servicer enforceable against it in accordance with its terms except as
such enforceability may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting
creditors' rights generally, now and hereafter 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).
(e) No Conflict. The Servicer's execution and delivery of the
Transaction Documents to which it is a party, performance of the
transactions contemplated by the Transaction Documents, and fulfillment of
the terms hereof and thereof applicable to the Servicer, do not conflict
with or violate any Requirement of Law applicable to the Servicer or
solely with respect to the servicing of Receivables, do not conflict with
or
Pooling and Servicing Agreement
49
violate in any material respect any Requirement of Law, or conflict with,
result in any breach of any of the terms or provisions of, or constitute
(with or without notice or lapse of time or both) a 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 Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of the Servicer, threatened against the
Servicer before any Governmental Authority (i) asserting the illegality,
invalidity or unenforceability, or seeking any determination or ruling
that would affect the legality, binding effect, validity or
enforceability, of the Transaction Documents, (ii) seeking to prevent the
issuance of the Certificates or the consummation of any of the
transactions contemplated by the Transaction Documents, or (iii) seeking
any determination or ruling that may materially and adversely affect the
financial condition or operations of the Servicer and its Subsidiaries
taken as a whole or the performance by the Servicer of its obligations
under the Transaction Documents.
(g) No Consents. No authorization, consent, license, order or
approval of or registration or declaration with any Person or Governmental
Authority is required to be obtained, effected or given by the Servicer in
connection with the execution and delivery of the Transaction Documents to
which it is a party by the Servicer or the performance of its obligations
hereunder and thereunder, except for authorizations, consents, licenses,
orders, approvals, registrations and declarations that have been duly
obtained, given or made and are in full force and effect.
(h) Muehlstein Post Office Boxes, Muehlstein Collection Accounts and
the Concentration Account. Specified on Schedule 3.03(h) hereto are (i)
the Muehlstein Post Office Box numbers, (ii) the names, addresses and ABA
numbers of all the Muehlstein Collection Account Banks, together with the
account numbers of the Muehlstein Collection Accounts and the name of a
contact person at each Muehlstein Collection Account Bank and (iii) the
name, address and ABA number of the Concentration Account Bank, together
with the account number and the name of a contact person for the
Concentration Account.
(i) Payment Instructions. The Servicer has notified the Obligor on
each Receivable to make payments on such Receivable to either one of the
Muehlstein Post Office Boxes or one of the Muehlstein Collection Accounts.
(j) Daily Reports and Determination Date Certificates. Each Daily
Report and Determination Date Certificate delivered by the Servicer
pursuant to this Agreement shall be true and correct in all material
respects as of the date such report or certificate is delivered.
Pooling and Servicing Agreement
50
(k) Servicer Default. No Servicer Default has occurred or is
continuing.
(l) Trust Early Amortization Event. No Trust Early Amortization
Event has occurred or is continuing.
The representations and warranties set forth in this Section 3.03
shall survive the Transfer of the Receivables to the Trust and the issuance of
the Certificates, and shall cease and be of no effect upon the indefeasible
repayment in full of the Invested Amount of the last outstanding Series and all
other obligations of the Transferor hereunder. Upon a discovery by the
Transferor, the Servicer or the Trustee of a breach of any of the foregoing
representations and warranties, the party discovering such breach shall give
prompt written notice to the other parties and to each Enhancement Provider, if
any. The Trustee's obligations in respect of any such breach are limited as
provided in Section 11.02(g).
SECTION 3.04. Covenants of the Servicer. The Servicer hereby
covenants and agrees that, until termination of the Trust:
(a) Change in Accounts. The Servicer will not (i) make any changes
to Schedule 3.03(h) hereto or (ii) amend any instruction to any Obligor or
any Muehlstein Collection Account Bank with respect to any Muehlstein Post
Office Box or Muehlstein Collection Account or (iii) terminate or
substitute any Cure Account, in any case (A) except as otherwise required
or permitted pursuant to Section 4.02 or the applicable Supplement and (B)
unless the Trustee shall have received written notice of such change,
amendment, termination or substitution and executed copies of Muehlstein
Collection Account Letters to each new Muehlstein Collection Account Bank.
(b) Collections. (i) In the event that the Servicer receives any
Collections, the Servicer agrees to hold all such Collections in trust and
to deposit such Collections to the appropriate Collection Account as soon
as practicable, but in no event later than two Business Days after receipt
thereof.
(ii) In the event that any Affiliate of the Servicer receives any
Collections, the Servicer agrees to cause such Affiliate to hold all such
Collections in trust and to cause such Affiliate to deposit such
Collections to the appropriate Collection Account as soon as practicable,
but in no event later than five Business Days after receipt thereof.
(c) Compliance with Requirement of Law. The Servicer will (i) duly
satisfy all obligations on its part to be fulfilled under or in connection
with each Receivable in accordance with the Muehlstein Credit Policy
Manual, (ii) maintain in effect all qualifications required under any
Requirement of Law in order to service properly each
Pooling and Servicing Agreement
51
Receivable in accordance with the Muehlstein Credit Policy Manual and the
Transaction Documents, and (iii) comply in all material respects with all
other Requirements of Law in connection with servicing each Receivable.
(d) Extension or Amendment of Receivables. The Servicer will not
extend, amend or otherwise modify (or consent or fail to object to any
such extension, amendment or modification by the Transferor), except as
permitted in Section 3.01(c), the terms of any Receivable, or amend,
modify or waive (or consent or fail to object to any such amendment,
modification or waiver by the Transferor) any payment term or condition of
any invoice related thereto (other than as provided in the Muehlstein
Credit Policy Manual) if the effect of such amendment, modification or
waiver would impair the collectibility or delay the payment of any then
existing Receivable beyond 120 days from the date of the invoice; provided
that the Servicer may extend, amend or otherwise modify the date of
payment of any Receivable beyond 120 days from the date of invoice if such
extension, amendment or modification is reasonably calculated to enhance
the collectibility of such Receivable. The Servicer will not rescind or
cancel, or permit the rescission or cancellation of, any Receivable except
as ordered by a court of competent jurisdiction or other Governmental
Authority. Notwithstanding the foregoing provisions of this Section
3.04(d), each of the Servicer and the Transferor may extend, amend,
modify, cancel or rescind (and the Servicer need not object to any such
action by the Transferor) any Diluted Receivable in connection with a
valid dispute; provided, however, that such amendment, modification,
cancellation or rescission shall not have a material adverse effect on the
interests of any Beneficiary.
(e) Protection of Certificateholders' Rights. The Servicer will take
no action which would impair the rights of any Beneficiary in any
Receivable or Trust Asset, except as provided in this Agreement.
(f) Deposits to Concentration Account, any Muehlstein Collection
Account or any Series Account. The Servicer will not deposit or otherwise
credit, or cause to be so deposited or credited, or consent or fail to
object to any such deposit or credit known to it, cash or cash proceeds
other than Collections to the Concentration Account, any Muehlstein
Collection Account or any Series Account.
(g) Receivables Not to Be Evidenced by Promissory Notes. The
Servicer will take no action to cause any Receivable to be evidenced by
any "instrument" (as defined in the UCC of the jurisdiction the law of
which governs the perfection of the interest in such Receivable created
hereunder), except in connection with its enforcement, in which event the
Transferor shall deliver such instrument to the Trustee as soon as
reasonably practicable but in no event more than three Business Days after
execution thereof.
Pooling and Servicing Agreement
52
(h) Reporting Requirements. The Servicer will:
(i) furnish to the Trustee within one Business Day after a
Responsible Officer of the Servicer obtains knowledge of the
occurrence of a Servicer Default or an Early Amortization Event, or
the commencement of a Partial Amortization Period or Cure Period, or
any event which, with the giving of notice or lapse of time or both,
would constitute a Servicer Default or Early Amortization Event,
notify (either orally or in writing) the Trustee of such occurrence;
(ii) as soon as possible and in any event within three
Business Days after a Responsible Officer of the Servicer obtains
knowledge of the occurrence of a Servicer Default or any Early
Amortization Event, or the commencement of a Partial Amortization
Period or Cure Period, or any event which, with the giving of notice
or lapse of time or both, would constitute a Servicer Default or an
Early Amortization Event, furnish to the Trustee and to each
Enhancement Provider the written statement of a Responsible Officer
setting forth details of such Servicer Default or Early Amortization
Event, the commencement of such Partial Amortization Period or Cure
Period or such event and the action which the Servicer has taken and
proposes to take with respect thereto;
(iii) as soon as possible and in any event within three
Business Days after a Responsible Officer of the Servicer obtains
knowledge of any other event, development or information which may
materially adversely affect the ability of the Servicer to perform
its obligations under this Agreement, provide to the Trustee, each
Rating Agency and each Enhancement Provider a written statement of a
Responsible Officer of the Servicer with regard to such event,
development or information;
(iv) promptly, from time to time, furnish to the Trustee and
each Enhancement Provider such other information, documents, records
or reports regarding the Receivables, the other Trust Assets or the
condition or operations, financial or otherwise, of the Servicer as
the Trustee and each Enhancement Provider may from time to time
reasonably request;
(v) within thirty (30) days after the end of each fiscal month
in each Fiscal Year, deliver to the Trustee, each Rating Agency and
each Enhancement Provider the consolidated balance sheets of the
Servicer and its Subsidiaries as at the end of such period and the
related consolidated statements of income and cash flow of the
Servicer and its Subsidiaries for such fiscal month and for the
period from the beginning of the then current Fiscal Year to the end
of such
Pooling and Servicing Agreement
53
fiscal month, and for the corresponding period during the previous
Fiscal Year, and a comparison of the statement of the year to date
earnings and cash flow to the corresponding statement for the
corresponding period from the previous Fiscal Year, and the most
recently prepared forecasted consolidated balance sheet and
consolidated statement of earnings and cash flow of the Servicer and
its Subsidiaries for and as of the end of such Fiscal Year, and a
comparison of the statement of year to date earnings and cash flow
to the annual operating plan, certified by a Financial Officer of
the Servicer as fairly presenting the consolidated financial
position of the Servicer and its Subsidiaries as at the dates
indicated and the results of their operations and cash flow for the
periods indicated in accordance with GAAP, subject to normal year
end adjustments; and
(vi) within ninety (90) days after the end of each Fiscal Year
deliver to the Trustee, each Rating Agency and each Enhancement
Provider audited consolidated financial statements of the Servicer
and its Subsidiaries reported on by independent certified public
accountants of recognized national standing acceptable to the
Majority in Interest, which report shall be unqualified (or, if
qualified, only as to non-material matters) and shall state that
such financial statements fairly present the consolidated position
of the Servicer and its Subsidiaries as at the dates indicated in
conformity with GAAP applied on a basis consistent with prior years
(except for changes with which such independent certified public
accountants shall concur and which shall have been disclosed in the
notes to the financial statements) and that the examination by such
accountants in connection with such consolidated financial
statements has been made in accordance with generally accepted
auditing standards.
The Servicer shall provide to the Trustee access to the
documentation regarding the Receivables in such cases where the Trustee is
required in connection with the enforcement of the rights of
Certificateholders or by applicable statutes or regulations to review such
documentation, such access being afforded without charge and at the sole
cost and expense of the Servicer but only (i) upon reasonable request,
(ii) during normal business hours, (iii) subject to the Servicer's normal
security and confidentiality procedures and (iv) at reasonably accessible
offices in the continental United States designated by the Servicer.
(i) Filing of Continuation Statements. The Servicer shall prepare
and file such continuation statements and any other documents requested by
the Trustee, the Transferor or any of the Certificateholders or which may
otherwise be required by law to fully preserve and protect the interest of
the Trustee, the Transferor or any of the Certificateholders hereunder in
and to the Receivables.
Pooling and Servicing Agreement
54
(j) Change the Muehlstein Credit Policy Manual. The Servicer shall
comply with and perform its servicing obligations with respect to the
Receivables in accordance with the Muehlstein Credit Policy Manual, except
insofar as any failure to so comply or perform would not materially
adversely affect the Certificateholders. Subject to compliance with all
Requirements of Law, the Transferor or the Servicer, as applicable, may
change the terms and provisions of the Muehlstein Credit Policy Manual;
provided, however, that (i) with respect to a material change of
collection policies, the Rating Agency Condition is satisfied with respect
thereto and (ii) with respect to a change of collection procedures, no
material adverse effect on any Series of Certificate would result.
(k) Notification of Obligors. The Servicer will notify the Obligor
on each Receivable purchased by the Trust on or after the Transfer Date to
make payments on such Receivable to one of the Muehlstein Collection
Accounts.
(l) Modification of Systems. The Servicer agrees, promptly after the
material replacement or any material modification of any material
computer, automation or other operating systems (in respect of hardware or
software) used to provide the Servicer's services as Servicer or to make
any calculations or reports hereunder, to give written notice of any such
material replacement or modification to the Trustee.
(m) Servicer Business Days. No later than December 1 of each year,
the Servicer shall furnish the Trustee with a list of days other than
Saturday and Sunday, on which the Servicer shall be closed during the
immediately succeeding calendar year, except that with respect to the
calendar year 1996, the Servicer shall furnish such list to the Trustee on
or before the Transfer Date.
(n) Keeping of Records and Books of Account. The Servicer shall
maintain and implement administrative and operating procedures (including,
without limitation, the ability to recreate records evidencing the
Receivables in the event of the destruction of the originals thereof), and
keep and maintain all documents, books, microfiche, computer records and
other information necessary or reasonably advisable for the collection of
all the Receivables. Such documents, books, microfiche, and computer
records shall reflect all customary facts giving rise to the Receivables,
all payments and credits with respect thereto, and the computer records
shall be clearly marked to show the interests of the Trust in the
Receivables. The Servicer shall hold on behalf of the Trust (to the extent
of its interest therein) any document evidencing or securing a Receivable
and any Contract related to such Receivable and necessary to the servicing
of such Receivable and the collection thereof in accordance with the terms
of this Agreement. Such holding by the Servicer shall be in trust and
shall be deemed to be the holding thereof by the Trustee for purposes of
perfecting the Trust's rights therein
Pooling and Servicing Agreement
55
as provided in the UCC.
(o) Maintenance of Insurance. The Servicer shall use its best
efforts to maintain with a responsible company, and at its own expense,
its current commercial crime insurance (including, without limitation,
commercial fraud insurance) as is commercially available at a cost that is
not generally regarded as excessive by industry standards, with coverage
on all officers, employees or other Persons acting in any capacity
requiring such Persons to handle funds, money, documents or papers
relating to the Receivables.
Notwithstanding anything herein to the contrary and in accordance with Section
3.01(b), if the Trustee is acting as Successor Servicer hereunder it will not be
bound to follow the Muehlstein Credit Policy Manual but shall service the
Receivables in accordance with customary industry standards in effect from time
to time.
SECTION 3.05. Reports and Records for the Trustee. (a) Daily
Records. On each Business Day, the Servicer shall provide by telecopy to the
Trustee, and upon request to any Enhancement Provider and each Investor
Certificateholder, the Daily Report and, to the extent not covered in the Daily
Report, a record setting forth (i) the Collections in respect of the Receivables
processed by the Servicer on the immediately preceding Business Day, (ii) the
amount of Eligible Receivables as of the close of business on the immediately
preceding Business Day and (iii) the Floating Allocation Percentage for each
Series at the close of business on the immediately preceding Business Day.
(b) Determination Date Certificate. On or before each Determination
Date with respect to each outstanding Series, the Servicer shall deliver by
telecopy to the Trustee each Rating Agency and each Enhancement Provider and the
Trustee shall deliver to each Investor Certificateholder a Determination Date
Certificate for such Determination Date.
SECTION 3.06. Annual Certificate of Servicer. On or before April 30
of each calendar year, beginning with April 30, 1997, the Servicer shall deliver
to the Trustee, each Rating Agency and each Enhancement Provider an Officer's
Certificate, executed by the chief financial officer of the Servicer,
substantially in the form of Exhibit B hereto. A copy of each such certificate
will be sent to each Investor Certificateholder by the Trustee.
SECTION 3.07. Semi-Annual Servicing Report of Independent Public
Accountants. Within 90 days after the Transfer Date and on an semi-annual basis
on or before March 31 and September 30 of each calendar year, beginning with
March 31, 1997, the Servicer shall at the Transferor's expense cause the
Independent Public Accountants to furnish a report (addressed to the Trustee) to
the Trustee, the Servicer, each Rating Agency and each Enhancement Provider
substantially to the effect set forth in Exhibit G; provided, however, that all
such Persons and a Majority of all Certificateholders may approve an alternative
Pooling and Servicing Agreement
56
arrangement.
SECTION 3.08. Tax Treatment. The Transferor has entered into this
Agreement, and the Investor Certificates have been (or will be) issued to and
acquired by the Investor Certificateholders, with the intention that, for
federal, state and local income and franchise tax law purposes, the Investor
Certificates will be indebtedness of the Transferor secured by the Receivables.
The Transferor, by entering into this Agreement, and each Certificateholder, by
the acceptance of its Certificate, agree to treat the Certificates for purposes
of federal, state and local income and franchise taxes as indebtedness of the
Transferor. Unless either (i) the Trustee or the Servicer shall receive an
Opinion of Counsel based on a change in applicable law occurring after the date
hereof that the Internal Revenue Code requires such a filing or (ii) the
Internal Revenue Service shall determine that the Trust is required to file such
a return in accordance with the foregoing, the Transferor agrees that it will
report its income for such federal, state and local income or franchise taxes on
the basis that it is the owner of the Receivables.
SECTION 3.09. Notices to Muehlstein. In the event that Muehlstein is
no longer acting as Servicer, any Successor Servicer shall deliver or make
available to Xxxxxxxxxx International, Muehlstein and the Transferor each
certificate and report required to be delivered thereafter pursuant to Sections
3.05, 3.06 and 3.07.
SECTION 3.10. Adjustments. If the Servicer makes a mistake with
respect to the amount of any Collection and deposits or pays 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 Trustee's
Account or Transferor's Account or paid to reflect such mistake and send written
notice thereof to the Trustee. Any Receivable in respect of which a dishonored
check is received shall be deemed not to have been paid.
SECTION 3.11. Securities and Exchange Commission Filings. For so
long as Muehlstein or any of its Affiliates is the Servicer, the Servicer shall
deliver or cause to be delivered to the Trustee, the Investor Certificateholders
and each Rating Agency copies of each report of Muehlstein, the Transferor,
Muehlstein, Xxxxxxxxxx International and any other Affiliate of Muehlstein which
is a party to any Transaction Document filed with the Securities and Exchange
Commission on Forms 10-K and 10-Q promptly after any such filing has been made.
Pooling and Servicing Agreement
57
ARTICLE IV
RIGHTS OF CERTIFICATEHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS
SECTION 4.01. Rights of Certificateholders. (a) The Investor
Certificates shall represent fractional undivided beneficial interests in the
Trust (with respect to each Series, the "Certificateholders' Interest"), which
shall consist of the right to receive, to the extent necessary to make the
required payments with respect to the Investor Certificates of such Series at
the times and in the amounts specified in the related Supplement, the portion of
Collections allocable to Investor Certificateholders of such Series pursuant to
this Agreement and the related Supplement from funds on deposit in the
Concentration Account allocable to Certificateholders of such Series and funds
on deposit in any related Series Account and funds available pursuant to any
related Enhancement (collectively with respect to all Series, the "Aggregate
Certificateholders' Interest"), it being understood that the Investor
Certificates of any Series shall not represent any interest in any Series
Account or Enhancement for the benefit of any other Series. The Transferor
Certificate shall represent the fractional undivided beneficial interest in the
remainder of the Trust Assets not allocated pursuant to this Agreement or any
Supplement to the Aggregate Certificateholders' Interest, including the right to
receive Collections with respect to the Receivables and other amounts at the
times and in the amounts specified in this Agreement or in any Supplement to be
paid to the Holder of the Transferor Certificate (the "Transferor Interest");
provided, however, that the Transferor Certificate shall not represent any
interest in the Concentration Account, any Muehlstein Collection Account, any
Series Account or any Enhancement, except as specifically provided in this
Agreement or any Supplement.
(b) The Floating Allocation Percentage for each Series, which is the
percentage that determines the portion of the Aggregate Certificateholders'
Interest allocable to such Series, and the Transferor Percentage, which is the
percentage that determines the Transferor Interest, shall be initially computed
by the Servicer as of the opening of business of the Servicer on the Initial
Issuance Date for the related Series. Thereafter until the commencement of an
Amortization Period for a Series, an Early Amortization Period for a Series or
the Partial Amortization Period, the Floating Allocation Percentage for each
Series and the Transferor Percentage, and through the recomputations thereof the
Certificateholders' Interest for each Series and the Transferor Interest, shall
be recomputed by the Servicer as of the close of business of the Servicer on
each Business Day. Each of the Certificateholders' Interests, the Floating
Allocation Percentage for each Series, the Transferor Interest and the
Transferor Percentage (i) shall remain constant from the time as of which any
such computation or recomputation is made until the time as of which the next
such recomputation, if any, shall be made and (ii) as computed as of the close
of business of the Servicer on the Business Day immediately preceding the
commencement of an Amortization Period for a
Pooling and Servicing Agreement
58
Series, an Early Amortization Period for a Series or a Partial Amortization
Period, shall remain constant at all times during such Amortization Period,
Early Amortization Period or such Partial Amortization Period.
SECTION 4.02. Establishment of Concentration Account and Muehlstein
Collection Accounts. (a) Concentration Account. On or prior to the Transfer
Date, the Servicer, for the benefit of the Certificateholders, shall establish
and maintain or cause to be established and maintained in the name of the
Trustee, on behalf of the Trust, with an Eligible Institution a segregated trust
account accessible by the Trustee (such account being the "Concentration
Account" and such institution holding such account being the "Concentration
Account Bank"), such account bearing a designation clearly indicating that the
funds deposited therein are held for the benefit of the Certificateholders. The
Trustee shall possess all right, title and interest in and to all funds from
time to time on deposit in the Concentration Account and in all proceeds
thereof. The Concentration Account shall be under the sole dominion and control
of the Trustee for the benefit of the Certificateholders. Except as expressly
provided in this Agreement, the Servicer agrees that it shall have no right of
set-off or banker's lien against, and no right to otherwise deduct from, any
funds held in the Concentration Account for any amount owed to it by the
Trustee, the Trust or any Certificateholder. The Servicer shall cause
Collections to be deposited into the Concentration Account on each Business Day
as promptly as is reasonably practicable after receipt in the Collection
Account. The Transferor will require the Originators to deposit any Collections
received by any of them into a Muehlstein Collection Account within two Business
Days following the Business Day on which such Collections are so received or, if
such day is not a Business Day, the next succeeding Business Day.
Notwithstanding the foregoing, if and to the extent that funds that are not
Collections are deposited into the Concentration Account, the Servicer may
direct in writing the Trustee to withdraw such funds from the Concentration
Account and deposit them in the related Transferor's Account.
If, at any time, the institution holding the Concentration Account
ceases to be an Eligible Institution, the Servicer, upon obtaining actual
knowledge thereof, for the benefit of the Certificateholders, shall within 15
Business Days (i) establish a new Concentration Account meeting the conditions
specified above with an Eligible Institution, (ii) transfer any cash and/or any
investments held therein or with respect thereto to such new Concentration
Account and (iii) in the case of any new Concentration Account, deliver to all
Muehlstein Collection Account Banks new Muehlstein Collection Account Letters
(with copies thereof to the Trustee) referring to such new Concentration
Account, and from the date such new Concentration Account is established, it
shall be the "Concentration Account". Pursuant to the authority granted to the
Servicer in Section 3.01, the Servicer shall have the power to instruct the
Trustee to make withdrawals and payments from the Concentration Account for the
purposes of carrying out the Servicer's or the Trustee's duties specified in
this Agreement.
Funds on deposit in the Concentration Account or, in the case of
funds on
Pooling and Servicing Agreement
59
deposit on any Deposit Date or Distribution Date, funds required pursuant to the
applicable Supplement to be deposited to the Trustee's Account or the
Transferor's Account on such date, shall at the direction of the Servicer be
invested by the Trustee or the Eligible Institution maintaining such accounts in
Eligible Investments as instructed by the Servicer in writing (which may be a
standing instruction) (or if not so instructed, then invested by the Trustee or
the Eligible Institution maintaining such accounts in any Eligible Investments
listed in clause (d) of the definition of Eligible Investments). All such
Eligible Investments shall be held by the Trustee or the Eligible Institution
maintaining such accounts for the benefit of the Certificateholders. Such funds
shall be invested in Eligible Investments that will mature so that funds will be
available in amounts sufficient for the Servicer to make each distribution
required under the applicable Supplement on the Distribution Date with respect
to such Collection Period. Funds deposited in the Concentration Account on a
Determination Date with respect to the next following Distribution Date are not
required to be invested overnight. On each Distribution Date, all interest and
other investment earnings (net of losses and investment expenses) received on
funds on deposit in the Concentration Account, to the extent such investment
income is not needed to pay the Certificateholders on such Distribution Date,
shall be paid to the Transferor, except as otherwise specified in any
Supplement. The Trustee is hereby authorized, unless otherwise directed by the
Servicer, to effect transactions in Eligible Investments through a capital
markets affiliate of the Trustee.
(b) Xxxxxxxxxx Collection Accounts. On or prior to the Transfer
Date, the Servicer, for the benefit of the Certificateholders, shall establish
and maintain or cause to be established and maintained (i) post-office boxes to
which Obligors will remit payments with respect to any Receivable (each such
post-office box, a "Xxxxxxxxxx Post Office Box") and (ii) in the name of the
Trustee, on behalf of the Trust, with an Eligible Institution, segregated
accounts accessible by the Trustee (each such account, a "Xxxxxxxxxx Collection
Account"). Obligors will be directed to remit payments with respect to their
Receivables to a Xxxxxxxxxx Post-Office Box or a Xxxxxxxxxx Collection Account.
The Xxxxxxxxxx Post Office Boxes and Xxxxxxxxxx Collection Accounts shall be
under the sole dominion and control of the Trustee for the benefit of the
Certificateholders; provided, however, that each Xxxxxxxxxx Post Office Box
shall be accessible by the Trustee for the purpose of transferring Collections
to a Xxxxxxxxxx Collection Account and each Xxxxxxxxxx Collection Account shall
be accessible by the Servicer for the purpose of transferring Collections to the
Concentration Account in the manner set forth in Section 4.02(a). Specified on
Schedule 3.03(h) hereto are (i) the Xxxxxxxxxx Post Office Box numbers, (ii) the
names, addresses and ABA numbers of all the Xxxxxxxxxx Collection Account Banks,
together with the account numbers of the Xxxxxxxxxx Collection Accounts and the
name of a contact person at each Xxxxxxxxxx Collection Account Bank and (iii)
the name, address and ABA number of the Concentration Account Bank, together
with the account number and the name of a contact person for the Concentration
Account. Each Xxxxxxxxxx Collection Account shall be maintained with
documentation and instructions in form and substance satisfactory to the
Trustee. Such documentation shall provide, among other things, that available
amounts shall be promptly transferred to the Concentration
Pooling and Servicing Agreement
60
Account. The Servicer will not (i) make any changes to Schedule 3.03(h) hereto
or (ii) amend any instruction to any Obligor or any Xxxxxxxxxx Collection
Account Bank with respect to any Xxxxxxxxxx Post Office Box or Xxxxxxxxxx
Collection Account unless the Trustee (if directed to do so by a Majority in
Interest of any outstanding Series or, if the related Supplement so provides,
the Enhancement Provider for such Series) shall have given its prior consent to
such change or amendment and shall have received executed copies of the
Xxxxxxxxxx Collection Account Letters to each new Xxxxxxxxxx Collection Account
Bank.
The Servicer hereby agrees and acknowledges that (i) it has executed
and delivered to the Trustee a letter and executed acknowledgement thereto
substantially in the form of Exhibit C hereto (each, a "Xxxxxxxxxx Collection
Account Letter"), addressed to each banking institution with which a Xxxxxxxxxx
Collection Account is maintained (each, a "Xxxxxxxxxx Collection Account Bank")
and (ii) it shall execute and deliver a substantially similar Xxxxxxxxxx
Collection Account Letter prior to the establishment by it of any additional or
alternative Xxxxxxxxxx Collection Account. The Servicer hereby agrees, and the
Trustee hereby acknowledges, that the execution and delivery of a Xxxxxxxxxx
Collection Account Letter transfers all right, title and interest in all monies,
securities and instruments in the applicable Xxxxxxxxxx Collection Account to
the Trustee. The Servicer agrees to amend Schedule 3.03(h) hereto to reflect any
change in the Xxxxxxxxxx Collection Account Banks and to execute such further
documents and take such other actions as may be reasonably requested by the
Trustee in order to effect such transfer.
SECTION 4.03. Allocation of Collections. Collections will be
allocated to each Series as specified in the related Supplement, and amounts so
allocated to any Series will not, except as specified in the related Supplement,
be available to the Investor Certificateholders of any other Series. Allocations
thereof between the Certificateholders' Interest and the Transferor Interest,
among the Series or to any Enhancement Agreement and to any Enhancement Provider
shall be set forth in the related Supplement or Supplements. If, on any day, the
sum of the Floating Allocation Percentages for all outstanding Series exceeds
100%, as set forth on the applicable Daily Report, then the aggregate of the
Investor Collections for all outstanding Series shall be allocated pro rata
among all outstanding Series on the basis of the Series Allocation Percentage
for each such Series; provided, however, that if on any day the amount of
Investor Collections for any Series is not sufficient to pay the full amount of
interest due and payable on such day to the Investor Certificateholders of each
Series on such day, then the aggregate of the Investor Collections for all
outstanding Series shall be allocated pro rata among all outstanding Series on
the basis of a fraction, for each Series, the numerator of which is the Invested
Amount of such Series and the denominator of which is the Trust Invested Amount.
Pooling and Servicing Agreement
61
ARTICLE V
DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS
SECTION 5.01. Distributions and Reports to Certificateholders.
Distributions shall be made to, and reports shall be provided to,
Certificateholders as set forth in the applicable Supplement.
ARTICLE VI
THE CERTIFICATES
SECTION 6.01. The Certificates. The Investor Certificates of any
Series shall be issued in registered form and shall be in substantially the form
set forth as an exhibit to the applicable Supplement and shall upon issue be
executed and delivered by the Transferor to the Trustee for authentication and
redelivery as provided in Section 6.02. The Investor Certificates shall be
issued in minimum denominations of $1,000,000 and in integral multiples of
$1,000 in excess thereof (except that one Certificate may be issued in a
denomination that includes any residual amount), and shall be issued upon
initial issuance as one or more Investor Certificates in an aggregate original
principal amount equal to the Initial Invested Amount. The Transferor
Certificate shall be a single certificate, substantially in the form of Exhibit
A hereto, and shall represent the entire Transferor Interest. Each Certificate
shall be executed by manual or facsimile signature on behalf of the Transferor
by the President, any Vice President, the Chief Administrative and Credit
Officer, Treasurer or the Secretary of the general partner of the Transferor, or
by any other officer or assistant officer duly authorized to execute such
Certificate on behalf of the Transferor. Certificates bearing the manual or
facsimile signature of the individual who was, at the time when such signature
was affixed, authorized to sign on behalf of the Transferor shall not be
rendered invalid, notwithstanding that such individual ceased to be so
authorized prior to the authentication and delivery of such Certificates or does
not hold such office at the date of such Certificates. No Certificates shall be
entitled to any benefit under this Agreement or the applicable Supplement or be
valid for any purpose, unless there appears on such Certificate a certificate of
authentication in substantially the form provided in Exhibit A hereto executed
by or on behalf of the Trustee by the manual signature of a duly authorized
signatory, and such certificate upon any Certificate shall be conclusive
evidence, and the only evidence, that such Certificate has been duly
authenticated and delivered hereunder. All Certificates shall be dated the date
of their authentication.
SECTION 6.02. Authentication of Certificates. The Trustee shall
authenticate
Pooling and Servicing Agreement
62
and deliver the Investor Certificates of each Series to, and upon the written
order of, the Transferor against payment to the Transferor of the purchase price
therefor. The Trustee shall authenticate and deliver the Transferor Certificate
to the Transferor simultaneously with its delivery of the first Series of
Investor Certificates to be issued hereunder. The Certificates of any Series
shall be duly authenticated by or on behalf of the Trustee, in authorized
denominations equal to (in the aggregate), in the case of the Investor
Certificates, the Initial Invested Amount, and, in the case of the Transferor
Certificate, in the denomination equal to the Transferor Interest from time to
time, and together evidencing the entire ownership of the Trust.
SECTION 6.03. Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at its Corporate Trust Office, such
office or agency to be maintained in accordance with the provisions of Section
11.16, a register (the "Certificate Register") in which, subject to such
reasonable regulations as it may prescribe, a transfer agent and registrar
(which may be the Trustee) (the "Transfer Agent and Registrar") shall provide
for the registration of the Certificates and of transfers and exchanges of the
Certificates as herein provided. The Transfer Agent and Registrar shall
initially be the Trustee, and any co- transfer agent and co-registrar chosen by
the Trustee and acceptable to the Servicer. Any reference in this Agreement to
the Transfer Agent and Registrar shall include any co-transfer agent and
co-registrar unless the context requires otherwise.
The Trustee shall be permitted to resign as Transfer Agent and
Registrar upon 30 days' (60 days' during an Amortization Period) written notice
to the Transferor and the Servicer; provided, however, that such resignation
shall not be effective and the Trustee shall continue to perform its duties as
Transfer Agent and Registrar until the Servicer has appointed a Successor
Trustee pursuant to Section 11.07, which Successor Trustee shall act as the
successor Transfer Agent and Registrar hereunder.
Upon surrender for registration of transfer of any Investor
Certificate at any office or agency of the Transfer Agent and Registrar
maintained for such purpose, the Transferor shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Investor Certificates (of the same Series) in
authorized denominations of like aggregate Undivided Fractional Interests in the
Aggregate Certificateholders' Interest.
At the option of an Investor Certificateholder, Investor
Certificates may be exchanged for other Investor Certificates (of the same
Series) in authorized denominations of like aggregate Undivided Fractional
Interests in the Certificateholders' Interest, upon surrender of the Investor
Certificates to be exchanged at any such office or agency. Whenever any Investor
Certificates are so surrendered for exchange, the Transferor shall execute, and
the Trustee shall authenticate and deliver, the Investor Certificates which the
Certificateholder making the exchange is entitled to receive.
Pooling and Servicing Agreement
63
Every Investor Certificate presented or surrendered for registration
of transfer or exchange shall be accompanied by a written instrument of transfer
in a form satisfactory to the Trustee or the Transfer Agent and Registrar duly
executed by the Certificateholder thereof or his attorney-in-fact duly
authorized in writing. Each Holder must satisfy all transfer restrictions set
forth in the Certificates.
Each Investor Certificate shall be registered at all times as herein
provided, and any transfer or exchange of such Investor Certificate will be
valid for purposes hereunder only upon registration of such transfer or exchange
by the Trustee or the Transfer Agent and Registrar as provided herein. Payments
on any Distribution Date shall be made to Holders of record on the immediately
preceding Record Date.
No service charge shall be made for any registration of transfer or
exchange of Investor Certificates, but the Transfer Agent and Registrar or any
co-transfer agent and co-registrar may require payment of a sum sufficient to
cover any tax or governmental charge that may be imposed in connection with any
transfer or exchange of Investor Certificates.
All Investor Certificates surrendered for registration of transfer
or exchange, or for payment, shall be cancelled and disposed of in a manner
reasonably satisfactory to the Trustee.
(b) The Transfer Agent and Registrar will maintain at its expense in
New York, New York an office or offices or agency or agencies where Investor
Certificates may be surrendered for registration of transfer or exchange.
(c) Notwithstanding any other provision of this Section 6.03, no
registration of transfer of any Investor Certificate shall be made unless the
Transferor or the transferee shall deliver, at its expense, to the Transferor,
the Servicer and the Trustee a representation letter, substantially in the form
attached as Exhibit D to this Agreement, stating that such transferee is not a
"benefit plan investor" as defined in Section 2510.3101(f)(2) of the Labor
Regulations promulgated under ERISA; provided, however that this provision shall
not apply to any Enhancement Provider.
SECTION 6.04. Mutilated, Destroyed, Lost or Stolen Certificates. If
(a) any mutilated Certificate is surrendered to the Transfer Agent and
Registrar, or the Transfer Agent and Registrar receives evidence to its
satisfaction of the destruction, loss or theft of any Certificate and (b) there
is delivered to the Transfer Agent and Registrar, the Trustee, the Transferor
and the Servicer such indemnity (provided that a letter of indemnity from (i) an
insurance company or (ii) an institutional investor, in either case, of
investment grade credit rating shall satisfy such requirement) as may be
required by them to save each of them harmless, then, in the absence of notice
to the Trustee that such Certificate has been acquired
Pooling and Servicing Agreement
64
by a bona fide purchaser, the Transferor shall execute and the Trustee shall
authenticate and deliver, in exchange for or in lieu of any such mutilated,
destroyed, lost or stolen Certificate, a new Certificate of like tenor and (in
the case of any new Investor Certificate) Undivided Fractional Interest. In
connection with the issuance of any new Certificate under this Section 6.04, the
Trustee or the Transfer Agent and Registrar may require the payment by the
Certificateholder of a sum sufficient to pay any tax or other governmental
charge that may be imposed in relation thereto. Any duplicate Certificate issued
pursuant to this Section 6.04 shall constitute complete and indefeasible
evidence of ownership in the Trust, as if originally issued, whether or not the
lost, stolen or destroyed Certificate shall be found at any time.
SECTION 6.05. Persons Deemed Owners. At all times prior to due
presentation of a Certificate for registration of transfer, the Trustee, the
Transfer Agent and Registrar and any agent of any of them shall treat the Person
in whose name any Certificate is registered as the owner of such Certificate for
the purpose of receiving distributions pursuant to the terms of the applicable
Supplement and for all other purposes whatsoever and neither the Trustee, the
Transfer Agent and Registrar nor any agent of any of them shall be affected by
any notice to the contrary. Notwithstanding the foregoing, in determining
whether the Holders of the requisite Undivided Fractional Interests have given
any request, demand, authorization, direction, notice, consent or waiver
hereunder, Certificates owned by the Transferor, the Servicer or any Affiliate
thereof shall be disregarded and deemed not to be outstanding, except that, in
determining whether the Trustee shall be protected in relying upon any such
request, demand, authorization, direction, notice, consent or waiver, only
Certificates which a Responsible Officer of the Trustee actually knows to be so
owned shall be so disregarded. Certificates (other than a Transferor
Certificate) so owned which have been pledged in good faith shall not be
disregarded and may be regarded as outstanding if the pledgee establishes to the
satisfaction of the Trustee the pledgee's right so to act with respect to such
Certificates and that the pledgee is not the Transferor, the Servicer or an
Affiliate thereof or if a Responsible Officer of the Trustee has received
written notice thereof.
SECTION 6.06. Access to List of Certificateholders' Names and
Addresses. The Trustee will furnish or cause to be furnished by the Transfer
Agent and Registrar to the Servicer, the Transferor or any Investor
Certificateholder, within five Business Days after receipt by the Trustee of a
written request therefor from the Servicer, the Transferor or any Investor
Certificateholder, respectively, a list of the names and addresses of the
Certificateholders.
Every Certificateholder, by receiving and holding a Certificate,
agrees that neither the Trustee, the Transfer Agent and Registrar, the
Transferor, the Servicer, Xxxxxxxxxx, nor any of their respective agents, shall
be held accountable by reason of the disclosure of any such information as to
the names and addresses of the Certificateholders hereunder, regardless of the
sources from which such information was derived.
Pooling and Servicing Agreement
65
SECTION 6.07. Authenticating Agent. (a) The Trustee may appoint one
or more authenticating agents with respect to the Certificates which shall be
authorized to act on behalf of the Trustee in authenticating the Certificates in
connection with the issuance, delivery, registration of transfer, exchange or
repayment of the Certificates. Whenever reference is made in this Agreement to
the authentication of Certificates by the Trustee or the Trustee's certificate
of authentication, such reference shall be deemed to include authentication on
behalf of the Trustee by an authenticating agent and a certificate of
authentication executed on behalf of the Trustee by an authenticating agent.
Each authenticating agent must be acceptable to the Transferor and the Servicer.
(b) Any institution succeeding to the corporate agency business of
an authenticating agent shall continue to be an authenticating agent without the
execution or filing of any power or any further act on the part of the Trustee
or such authenticating agent.
(c) An authenticating agent may at any time resign by giving written
notice of resignation to the Trustee and to the Transferor. The Trustee may at
any time terminate the agency of an authenticating agent by giving notice of
termination to such authenticating agent and to the Transferor. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
an authenticating agent shall cease to be acceptable to the Trustee or the
Transferor, the Trustee may promptly appoint a successor authenticating agent.
Any successor authenticating agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an authenticating agent.
No successor authenticating agent shall be appointed unless acceptable to the
Trustee and the Transferor.
(d) The Transferor agrees to pay to each authenticating agent, from
time to time, reasonable compensation for its services under this Section 6.07.
(e) The provisions of Sections 7.03, 8.04, 11.01, 11.02 and 11.03
shall be applicable to any authenticating agent.
(f) Pursuant to an appointment made under this Section 6.07, the
Certificates may have endorsed thereon, in lieu of or in addition to the
Trustee's certificate of authentication, an alternate certificate of
authentication in substantially the following form:
Pooling and Servicing Agreement
66
This is one of the Certificates described in the Pooling and
Servicing Agreement among Xxxxxxxxxx Financial Corporation, X.
Xxxxxxxxxx & Co., Inc. and Bankers Trust Company, dated as of August
23, 1996.
_________________________________________
_________________________________________
as Authenticating Agent for the Trustee
By:______________________________________
Authorized Signer
SECTION 6.08. New Issuances. (a) The Transferor may from time to
time direct the Trustee, on behalf of the Trust, to issue one or more new Series
of Investor Certificates pursuant to a Supplement. The Investor Certificates of
all outstanding Series shall be equally and ratably entitled as provided herein
to the benefits of this Agreement without preference, priority or distinction,
all in accordance with the terms and provisions of this Agreement and the
applicable Supplement except, with respect to any Series, as provided in the
related Supplement.
(b) On or before the Initial Issuance Date relating to any new
Series, the parties hereto will execute and deliver a Supplement which will
specify the Principal Terms of such new Series. The terms of such Supplement may
modify or amend the terms of this Agreement solely as applied to such new
Series. The obligation of the Trustee to issue the Investor Certificates of such
new Series and to execute and deliver the related Supplement is subject to the
satisfaction of the following conditions:
(i) on or before the tenth Business Day immediately preceding the
Initial Issuance Date for such Series, the Transferor shall have given the
Trustee, the Servicer, each Rating Agency and any Enhancement Provider
written notice of such issuance and the Initial Issuance Date for such
Series;
(ii) the Transferor shall have delivered to the Trustee the related
Supplement, in form satisfactory to the Trustee, executed by each party
hereto other than the Trustee;
(iii) the Transferor shall have delivered to the Trustee any related
Enhancement Agreement executed by each party hereto other than the
Trustee;
Pooling and Servicing Agreement
67
(iv) each Rating Agency shall have notified the Transferor, the
Servicer, the Trustee, and any Enhancement Provider in writing that the
issuance of such new Series of Investor Certificates will not result in a
reduction or withdrawal of the rating of any outstanding Series with
respect to which it is a Rating Agency;
(v) such issuance will not result in the occurrence of a Trust Early
Amortization Event and the Transferor shall have delivered to the Trustee
and any Enhancement Provider an Officer's Certificate, dated the Initial
Issuance Date for such Series (upon which the Trustee may conclusively
rely), to the effect that the Transferor reasonably believes that such
issuance will not result in the occurrence of a Trust Early Amortization
Event and is not reasonably expected to result in the occurrence of a
Trust Early Amortization Event at any time in the future;
(vi) the Transferor shall have delivered to the Trustee and any
Enhancement Provider an Opinion of Counsel to the effect that the issuance
of the Investor Certificates of such Series (A) has been, or need not be,
registered under the Act and will not result in the requirement that any
other Series of Investor Certificates not registered under the Act be so
registered (unless the Transferor has elected, in its sole discretion, to
register such Certificates), (B) will not result in the Trust becoming
subject to registration as an investment company under the Investment
Company Act and (C) will not require this Agreement or the related
Supplement to be qualified under the Trust Indenture Act of 1939, as
amended;
(vii) the Transferor shall have delivered to the Trustee and any
Enhancement Provider a Tax Opinion, dated the Initial Issuance Date for
such Series, with respect to such issuance;
(viii) such issuance will not result in the aggregate of the
Floating Allocation Percentages for all outstanding Series (after giving
effect to such new issuance) exceeding 100%; and
(ix) the Receivables Purchase Agreements and the Parent Undertaking
Agreement shall be in full force and effect.
Upon satisfaction of the above conditions, the Trustee shall execute the
Supplement and the Transferor shall execute and deliver to the Trustee the
Investor Certificates of such Series for authentication and redelivery to or
upon the written order of the Transferor. Notwithstanding the provisions of this
section 6.08(b), prior to the execution of any Supplement, the Trustee shall be
entitled to receive and rely upon an Opinion of Counsel stating that the
execution of such Supplement is authorized or permitted by this Agreement and
any Supplement related to any outstanding Series. The Trustee may, but shall not
be obligated to, enter into any such Supplement which adversely affects the
rights, duties or immunities under this Agreement of
Pooling and Servicing Agreement
68
the Person, solely in its individual capacity then serving as Trustee (but not
its rights, duties or immunities as Trustee).
(c) The Transferor may surrender the Transferor Certificate to the
Trustee in exchange for a newly issued Transferor Certificate and a second
certificate (a "Supplemental Certificate"), the terms of which shall be subject
to Section 13.01 to the extent that it amends any of the terms of this
Agreement, to be delivered to or upon the order of the Transferor (or the holder
of a Supplemental Certificate, in the case of the transfer or exchange thereof,
as provided below), upon satisfaction of the following conditions:
(i) the Transferor shall have delivered to the Trustee an Officer's
Certificate certifying that the result obtained by multiplying (x) an
amount equal to the excess of the Net Receivables Balance over the Trust
Invested Amount by (y) the percentage equivalent of the portion of the
Transferor Interest represented by the Transferor Certificate, shall not
be less than 2% of the Outstanding Balance of all Receivables owned by the
Trust, in each case as of the date of, and after giving effect to, such
exchange;
(ii) the Rating Agency Condition (for which the applicable
Enhancement Provider shall not have unreasonably withheld its consent)
shall have been satisfied with respect to such exchange (or transfer or
exchange as provided below); and
(iii) the Transferor shall have delivered to the Trustee and any
Enhancement Provider a Tax Opinion, dated the date of such exchange (or
transfer or exchange as provided below), with respect thereto.
The Transferor Certificate will at all times be beneficially owned by the
Transferor. Any Supplemental Certificate may be transferred or exchanged only
upon satisfaction of the conditions set forth in clauses (ii) and (iii) above.
ARTICLE VII
OTHER MATTERS RELATING TO THE TRANSFEROR
SECTION 7.01. Obligations Not Assignable. The obligations of the
Transferor hereunder shall not be assignable nor shall any Person succeed to the
obligations of the Transferor hereunder.
SECTION 7.02. Limitations on Liability. None of the directors,
officers, employees or agents of the Transferor, past, present or future, shall
be under any liability to the Trust, the Trustee, the Certificateholders, the
Enhancement Provider or any other Person
Pooling and Servicing Agreement
69
for any action taken or for refraining from the taking of such action in such
capacities pursuant to this Agreement or for any obligation or covenant under
this Agreement; provided, however, that this provision shall not protect any
such Person against any liability which would otherwise be imposed by reason of
willful misconduct or gross negligence in the performance by such Person of such
Person's duties or the reckless disregard by such Person of any of his, her or
its obligations and duties hereunder. The Transferor and any director, officer,
employee or agent of the Transferor may rely in good faith on any document of
any kind prima facie properly executed and submitted by any Person (other than
the Transferor or any Affiliate thereof) respecting any matters arising
hereunder or under any Supplement or the Receivables Purchase Agreements.
SECTION 7.03. Indemnification of the Trustee, the
Certificateholders, the Program Agent and the Enhancement Provider. Without
limiting any other rights which the Trustee, the Certificateholders (other than
the Transferor and its Affiliates), the Program Agent or any Enhancement
Provider and their respective assignees and their respective officers,
directors, employees, agents and affiliates (each, an "Indemnified Party" and
collectively the "Indemnified Parties") may have hereunder or under applicable
law, the Transferor hereby agrees to indemnify each Indemnified Party from and
against any and all claims, damages, losses and liabilities and related costs
and expenses (including reasonable attorneys' fees and disbursements) (all of
the foregoing being collectively referred to as "Indemnified Amounts") awarded
against or incurred by any of them arising out of or resulting from this
Agreement, the activities of the Trustee in connection herewith, the
Transferor's use of proceeds of Transfers of Receivables or reinvestments of
Collections, the interest conveyed hereunder in Trust Assets, or in respect of
any Receivable or the Receivables Purchase Agreements (excluding however (a)
Indemnified Amounts resulting from gross negligence or willful misconduct on the
part of such Indemnified Party to which such Indemnified Amount would otherwise
be due, (b) losses in respect of Receivables to the extent reimbursement
therefor would constitute credit recourse to the Transferor for nonpayment of
any Receivable by any Obligor, (c) any income or franchise taxes or similar
taxes (or any interest or penalties with respect thereto) incurred by such
Indemnified Party arising out of or as a result of this Agreement or the
interest conveyed hereunder in Trust Assets or in respect of any Receivable or
the Receivables Purchase Agreements and (d) Indemnified Amounts resulting from
the acts or omissions of the Servicer (unless the Servicer is Muehlstein or any
Affiliate of Muehlstein)), to the extent caused by:
(i) reliance on any representation, warranty or covenant made or
statement made or deemed made by the Transferor (or any of its Responsible
Officers) under or in connection with this Agreement or the Receivables
Purchase Agreements which shall have been incorrect in any material
respect when made or deemed made or which the Transferor shall have failed
to perform;
(ii) the failure by the Transferor to comply with this Agreement or
any
Pooling and Servicing Agreement
70
applicable Requirement of Law with respect to any Receivable or the
Related Security or related Contract or the Receivables Purchase
Agreements, or the failure of any Receivable or the Related Security or
related Contract to conform to the applicable Receivables Purchase
Agreements or any Requirement of Law;
(iii) the failure to vest in the Trustee on behalf of the Trust for
the benefit of the Investor Certificateholders either an undivided
fractional beneficial interest, to the extent of their respective
Undivided Fractional Interests, or a perfected first priority security
interest in the Receivables and the other Trust Assets, free and clear of
any Lien;
(iv) the failure to have filed, or any delay in filing, any
financing statements or other similar instruments or documents under the
UCC of any applicable jurisdiction or other applicable laws that are
necessary for perfection or priority of the ownership and security
interest created by this Agreement;
(v) any commingling of Collections by the Transferor with other
funds of the Transferor or any of its Affiliates;
(vi) any investigation, litigation or proceeding related to this
Agreement or the Receivables Purchase Agreements or the use of proceeds or
reinvestments of proceeds by the Transferor, Xxxxxxxxxx International or
Muehlstein of Transfers of Receivables or the ownership of or security
interest in Trust Assets or in respect of any Receivable or Contract,
except to the extent of Indemnified Amounts attributable to any portion of
an investigation, litigation or proceeding relating to such Indemnified
Party's affairs which pertains to matters or transactions in addition to
those contemplated by the Transaction Documents;
(vii) any claim brought by any Person other than an Indemnified
Party arising from any activity by the Transferor or any Affiliate of the
Transferor in servicing, administering or collecting any Receivable;
(viii) any failure by the Transferor to perform its duties or
obligations in accordance with the provisions of this Agreement or any
Receivables Purchase Agreement; or
(ix) any tax (other than any income or franchise or similar tax, or
any interest or penalties with respect thereto) imposed by reason of
ownership of the Receivables or other Trust Assets by the Trustee on
behalf of the Trust.
Any Indemnified Amounts due hereunder shall be payable within
fifteen Business Days of submission of a claim by the Indemnified Party which
describes in
Pooling and Servicing Agreement
71
reasonable detail the basis for such claim.
Indemnification pursuant to this Section 7.03 shall only be payable
from assets of the Transferor. The agreement contained in this Section 7.03
shall survive the collection of all Receivables, the termination of the Trust
and the payment of all amounts otherwise payable hereunder.
Promptly after receipt by an Indemnified Party of any notice of the
commencement of any action, claim or other legal or arbitral proceeding (a
"Proceeding") which such Indemnified Party reasonably anticipates would subject
it to any Indemnified Amount, such Indemnified Party will, if a claim in respect
thereof is to be made by such Indemnified Party against the Transferor under
this Section 7.03, notify the Transferor in writing of the commencement thereof;
provided that (i) the omission so to notify the Transferor will not relieve it
from any liability which it may have hereunder unless and except to the extent
it did not otherwise learn of such Proceeding and such failure results in the
forfeiture by the Transferor of substantial rights or defenses which may arise
under this provision or otherwise, and (ii) the omission so to notify the
Transferor will not relieve it from liability which it may have to an
Indemnified Party otherwise than on account of this Section 7.03. In case any
such Proceedings are brought against any Indemnified Party and it notifies the
Transferor of the commencement thereof, the Transferor will be entitled to
participate therein, and to the extent that it may elect by written notice
delivered to the Indemnified Party, to assume the defense thereof, with counsel
reasonably satisfactory to such Indemnified Party; provided that if the
defendants in any such Proceedings include both the Indemnified Party and the
Transferor and the Indemnified Party shall have reasonably concluded that there
may be legal defenses available to it which are different from or additional to
those available to the Transferor, the Transferor shall not have the right to
direct the defense of such Proceeding on behalf of such Indemnified Party, and
the Indemnified Party shall have the right to select separate counsel to assert
such legal defenses on behalf of such Indemnified Party. Upon receipt of notice
from the Transferor to such Indemnified Party of the Transferor's election so to
assume the defense of such Proceedings and approval by the Indemnified Party of
counsel, the Transferor will not be liable to such Indemnified Party for
expenses incurred thereafter by the Indemnified Party in connection with the
defense thereof (other than reasonable costs of investigation prior to the
assumption of the defense by the Transferor's legal counsel) unless (i) the
Indemnified Party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the preceding
sentence, (ii) the Transferor shall not have employed counsel reasonably
satisfactory to the Indemnified Party to represent the Indemnified Party within
a reasonable time after notice by the relevant Indemnified Party to the
Transferor of commencement of the Proceedings or (iii) the Transferor has
authorized in writing the employment of counsel for the Indemnified Party at the
Transferor's expense. The indemnity, reimbursement and contribution obligations
of the Transferor hereunder shall be in addition to any other liability the
Transferor may otherwise have to an Indemnified Party and shall be binding upon
and inure to the benefit of any successors and assigns of the Transferor
Pooling and Servicing Agreement
72
and any Indemnified Party. No party subject to this Section 7.03 shall settle,
compromise or consent to the entry of any judgment in any Proceeding in respect
of which indemnification may be sought under this Section 7.03 (whether or not
any Indemnified Party is an actual or potential party to such Proceeding)
without the written consent of the other such parties, unless such settlement,
compromise or consent includes an unconditional release of each Indemnified
Party from all liability arising out of such Proceeding.
ARTICLE VIII
OTHER MATTERS RELATING TO THE SERVICER
SECTION 8.01. Liability of the Servicer. The Servicer shall be
liable under this Agreement only to the extent of the obligations specifically
undertaken by the Servicer in its capacity as Servicer. No implied duties or
covenants shall be read into this Agreement against the Servicer.
SECTION 8.02. Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer. The Servicer shall not consolidate with or merge
into any other Person or convey or transfer 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 or transfer
the properties and assets of the Servicer substantially as an entirety
shall be, if the Servicer is not the surviving entity, a corporation
organized and existing under the laws of the United States of America or
any State or the District of Columbia, and such corporation shall have
expressly assumed, by an agreement supplemental hereto, executed and
delivered to the Trustee in form satisfactory to the Trustee the
performance of every covenant and obligation of the Servicer hereunder;
(ii) the Servicer shall have delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel each in form satisfactory to the
Trustee and stating that such consolidation, merger, conveyance or
transfer complies with this Section 8.02 and that all conditions precedent
provided for in this Section 8.02(a) relating to such transaction have
been complied with; and (iii) the Rating Agency Condition shall have been
satisfied; and
(b) the corporation formed by such consolidation or into which the
Servicer is merged or which acquires by conveyance or transfer the
properties and assets of the Servicer substantially as an entirety shall
have all licenses and approvals of Governmental Authorities required to
service the Receivables.
SECTION 8.03. Limitations on Liability. None of the directors,
officers, employees or agents of the Servicer, past, present or future, shall be
under any liability to the
Pooling and Servicing Agreement
73
Trust, the Trustee, the Certificateholders or any other Person for any action
taken or for refraining from the taking of any action in such capacities
pursuant to this Agreement or for any obligation or covenant under this
Agreement, it being understood that, with respect to the Servicer, this
Agreement and the obligations created hereunder are solely the obligations of
the Servicer; provided, however, that this provision shall not protect the
Servicer or any such Person against any liability which would otherwise be
imposed by reason of willful misconduct or gross negligence by such Person of
any of his, her or its obligations and duties. The Servicer and any partner,
director, officer, employee or agent of the Servicer may rely in good faith on
any document of any kind prima facie properly executed and submitted by any
Person (other than the Servicer or any Affiliate thereof) 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 reasonably related to its
duties as Servicer in accordance with this Agreement and which may involve it in
any expense or liability.
SECTION 8.04. Servicer Indemnification. The Servicer hereby agrees
to indemnify each Indemnified Party from and against Indemnified Amounts awarded
against or incurred by any of them arising out of or resulting from this
Agreement, the activities of the Trust or the Trustee in connection herewith,
the Transferor's use of proceeds of Transfers of Receivables or reinvestments of
Collections, the interest conveyed hereunder in Trust Assets, or in respect of
any Receivable or the Receivables Purchase Agreements (excluding however (a)
Indemnified Amounts resulting from gross negligence or willful misconduct on the
part of such Indemnified Party to which such Indemnified Amount would otherwise
be due, (b) losses in respect of Receivables to the extent reimbursement
therefor would constitute credit recourse to the Transferor for nonpayment of
any Receivable by any Originator and (c) any income or franchise taxes or
similar taxes or any interest or penalties with respect thereto) incurred by
such Indemnified Party arising out of or as a result of this Agreement or the
interest conveyed hereunder in Trust Assets or in respect of any Receivable or
the Receivables Purchase Agreements to the extent caused by:
(i) reliance on any representation, warranty or covenant made by the
Servicer (or any of its Responsible Officers) under or in connection with
this Agreement which shall have been incorrect in any material respect
when made or which the Servicer shall have failed to perform;
(ii) the failure by the Servicer to comply with any applicable
Requirement of Law with respect to any Receivable or the Related Security
or related Contract;
(iii) any commingling by the Servicer of Collections with other
funds of the Servicer or any Affiliate;
(iv) any claim brought by any Person other than an Indemnified Party
arising from any activity by the Servicer or any Affiliate of the Servicer
in servicing,
Pooling and Servicing Agreement
74
administering or collecting any Receivable;
(v) any failure by the Servicer to perform its duties or obligations
in accordance with the provisions of this Agreement; or
(vi) the acceptance by the Seller as payment of any Receivable funds
denominated in a currency other than US Dollars.
Indemnification pursuant to this Section 8.04 shall only be payable
from the assets of the Servicer. The agreement contained in this Section 8.04
shall survive the collection of all Receivables, the termination of the Trust
and the payment of all amounts otherwise due hereunder.
Any Indemnified Amounts due hereunder shall be payable within
fifteen Business Days of submission of a claim by the Indemnified Party which
describes in reasonable detail the basis for such claim.
Promptly after receipt by an Indemnified Party of any notice of the
commencement of any action, claim or other legal or arbitral proceeding (a
"Proceeding") which such Indemnified Party reasonably anticipates would subject
it to any Indemnified Amount, such Indemnified Party will, if a claim in respect
thereof is to be made by such Indemnified Party against the Servicer under this
Section 8.04, notify the Servicer in writing of the commencement thereof;
provided that (i) the omission so to notify the Servicer will not relieve it
from any liability which it may have hereunder unless and except to the extent
it did not otherwise learn of such Proceeding and such failure results in the
forfeiture by the Servicer of substantial rights or defenses which may arise
under this provision or otherwise, and (ii) the omission so to notify the
Servicer will not relieve it from liability which it may have to an Indemnified
Party otherwise than on account of this Section 8.04. In case any such
Proceedings are brought against any Indemnified Party and it notifies the
Servicer of the commencement thereof, the Servicer will be entitled to
participate therein, and to the extent that it may elect by written notice
delivered to the Indemnified Party, to assume the defense thereof, with counsel
reasonably satisfactory to such Indemnified Party; provided that if the
defendants in any such Proceedings include both the Indemnified Party and the
Servicer and the Indemnified Party shall have reasonably concluded that there
may be legal defenses available to it which are different from or additional to
those available to the Servicer, the Servicer shall not have the right to direct
the defense of such Proceeding on behalf of such Indemnified Party, and the
Indemnified Party shall have the right to select separate counsel to assert such
legal defenses on behalf of such Indemnified Party. Upon receipt of notice from
the Servicer to such Indemnified Party of the Servicer's election so to assume
the defense of such Proceedings and approval by the Indemnified Party of
counsel, the Servicer will not be liable to such Indemnified Party for expenses
incurred thereafter by the Indemnified Party in connection with the defense
thereof (other than reasonable costs of investigation prior to the
Pooling and Servicing Agreement
75
assumption of the defense by the Servicer's legal counsel) unless (i) the
Indemnified Party shall have employed separate counsel in connection with the
assertion of legal defenses in accordance with the proviso to the next preceding
sentence, (ii) the Servicer shall not have employed counsel reasonably
satisfactory to the Indemnified Party to represent the Indemnified Party within
a reasonable time after notice by the relevant Indemnified Party to the Servicer
of commencement of the Proceedings or (iii) the Servicer has authorized in
writing the employment of counsel for the Indemnified Party at the Servicer's
expense. The indemnity, reimbursement and contribution obligations of the
Servicer hereunder shall be in addition to any other liability the Servicer may
otherwise have to an Indemnified Party and shall be binding upon and inure to
the benefit of any successors and assigns of the Servicer and any Indemnified
Party. No party subject to this Section 8.04 shall settle, compromise or consent
to the entry of any judgment in any Proceeding in respect of which
indemnification may be sought under this Section 8.04 (whether or not any
Indemnified Party is an actual or potential party to such Proceeding) without
the written consent of the other such parties, unless such settlement,
compromise or consent includes an unconditional release of each Indemnified
Party from all liability arising out of such Proceeding.
SECTION 8.05. The Servicer Not to Resign. The Servicer shall not
resign from the obligations and duties hereby imposed on it except upon
determination that (i) its performance of its duties hereunder is no longer
permissible under applicable law and (ii) there is no reasonable action which
the Servicer could take without incurring material liabilities to make its
performance of its duties hereunder permissible under applicable law. Any
determination permitting the resignation of the Servicer shall be evidenced by
an Opinion of Counsel who is not an employee of the Servicer or any Affiliate of
the Servicer with respect to clause (i) above, delivered to, and in form
reasonably satisfactory to, the Trustee. No resignation shall become effective
until the Trustee or a Successor Servicer shall have assumed the
responsibilities and obligations of the Servicer in accordance with Section
10.02.
SECTION 8.06. Examination of Records. The Servicer shall xxxx its
computer records to give proper notice that the Receivables and other Trust
Assets have been transferred to the Trustee, on behalf of the Trust, pursuant to
this Agreement for the benefit of the Certificateholders. The Servicer (and the
Transferor) shall, prior to the sale or transfer to a party other than the
Transferor of any receivable held in its custody, examine its records to
determine that such receivable is not a Receivable.
SECTION 8.07. Confidentiality. The Servicer agrees to use its best
efforts, and shall cause its agents or representatives to use their best
efforts, to hold in confidence all Confidential Information; provided that
nothing herein shall prevent the Servicer from delivering copies of any
financial statements and other documents constituting Confidential Information
or disclosing any other Confidential Information (i) to a Successor Servicer or
as required by a Requirement of Law applicable to the Servicer, (ii) as required
in the performance of the Servicer's duties hereunder, (iii) as required in
enforcing the rights of the
Pooling and Servicing Agreement
76
Certificateholders hereunder or (iv) as provided in any Supplement. The Servicer
agrees to take such measures as shall be reasonably requested by the Transferor
to protect and maintain the security and confidentiality of all Confidential
Information and, in connection therewith, will allow the Transferor to inspect
the Servicer's security and confidentiality arrangements from time to time
during normal business hours. The Servicer shall use its best efforts to provide
the Transferor written notice at least five Business Days prior to any
disclosure pursuant to this Section 8.07 and in any event will provide written
notice whenever any such disclosure is made.
ARTICLE IX
TRUST EARLY AMORTIZATION EVENTS
SECTION 9.01. Trust Early Amortization Events. If any one of the
following events shall occur:
(a) any failure by the Transferor or the Servicer to make any
payment, transfer or deposit required to be paid, effected or made by it
hereunder (including pursuant to Section 3.04 (b))within two Business Days
after the same shall become due; or
(b) any representation or warranty (other than a representation and
warranty under Section 2.04 (e) that shall have given rise to a repurchase
obligation under Section 2.04), certification or written statement made or
deemed made by the Transferor or the Servicer under or in connection with
this Agreement, or by Muehlstein under or in connection with the Parent
Undertaking Agreement, or in any statement, record, certificate, financial
statement or other document delivered pursuant to this Agreement or the
Parent Undertaking Agreement, or in connection with this Agreement the
Parent Undertaking Agreement shall prove to have been incorrect in any
respect on or as of the date made or deemed made which has a material
adverse effect on the interests of any Beneficiary of any Series; or
(c) the Transferor or the Servicer shall fail to observe or perform
any covenant or agreement applicable to it contained herein which has a
material adverse effect on any Beneficiary if such failure shall remain
unremedied for ten days; or
(d) any Receivables Purchase Agreement shall for any reason cease to
be in full force and effect or an Early Termination (as defined therein)
shall occur; or
(e) the Net Receivables Balance is less than the Required Net
Receivables Balance on the fifth consecutive Business Day following a Pool
Non-compliance Date;
Pooling and Servicing Agreement
77
or
(f) an Insolvency Event shall occur with respect to any Originator,
the Transferor, the Servicer, Muehlstein or the Trust; or
(g) the Securities and Exchange Commission or other regulatory body
having jurisdiction reaches a final determination that the Trust is an
"investment company" within the meaning of the Investment Company Act; or
(h) (i) any purchase of any Receivables by the Transferor under any
Receivables Purchase Agreement shall cease to create a valid sale,
transfer and assign ment to the Transferor of all right, title and
interest of the Originator in and to such Receivables and the proceeds
thereof, or (ii) any Transfer of any Receivables on any date shall for any
reason cease to create a valid transfer and assignment to the Trust of all
right, title and interest of the Transferor in and to such Receivables and
the proceeds thereof or, if such Transfer does not constitute such a sale,
transfer and assignment, cease to create a valid and perfected first
priority "security interest" (as defined in the UCC of the State of New
York and of the jurisdiction the law of which governs the perfection of
the interest in such Receivables created hereunder) in such Receivables
and the proceeds thereof, or (iii) the Investor Certificates delivered
hereunder shall for any reason (other than due to the acts or omissions of
the Investor Certificateholders) cease to evidence the transfer to the
Investor Certificateholders of, or the Investor Certificateholders shall
otherwise cease to have, a beneficial interest in a trust owning or the
Trustee on behalf of the Trust having a perfected first priority security
interest in the Receivables and the other Trust Assets now existing and
hereafter arising and the proceeds thereof to the extent of their
respective Undivided Fractional Interests; or
(i) the Trust at any time receives a final determination that it
will be treated as an association (or publicly traded partnership) taxable
as a corporation for federal income tax purposes; or
(j) a Servicer Default shall have occurred and be continuing; or
(k) the Servicer shall have resigned in accordance with the terms of
this Agreement; or
(l) Muehlstein shall fail to observe or perform any covenant or
agreement (within any applicable cure period) applicable to it contained
in the Parent Undertaking Agreement, or the Parent Undertaking Agreement
shall cease to be in effect; or
(m) any material adverse change shall occur in the collectibility of
the Receivables taken as a whole or in the financial condition of the
Transferor, Muehlstein
Pooling and Servicing Agreement
78
and its subsidiaries taken as a whole or the Servicer and its subsidiaries
taken as a whole, or in the ability of any of them to perform its
obligations under any Transaction Document; or
(n) any breach, default or event of default shall occur or any other
condition shall exist under any instrument, agreement or indenture
pertaining to any Indebtedness of Muehlstein in excess of $3 million if
the effect thereof is to cause an acceleration, mandatory redemption or
other required repurchase of such Indebtedness; or any such Indebtedness
shall be otherwise declared to be due and payable (by acceleration or
otherwise) or required to be prepaid, redeemed or otherwise repurchased by
Muehlstein (other than by a regularly scheduled required prepayment,
mandatory redemption or required repurchase) prior to the stated maturity
thereof; or
(o) Muehlstein and its subsidiaries shall at any time fail to have
Consolidated Tangible Net Worth of at least $15 million; or
(p) the Intercreditor Agreement shall cease to be in full force and
effect; or
(q) (i) any Plan Event shall have occurred, (ii) the Transferor or
any ERISA Affiliate shall have withdrawn from a Multiemployer Plan, or
(iii) any Multiemployer Plan shall have been terminated or reorganized or
become insolvent, and as a result of one or more such events the
Transferor or any ERISA Affiliate has incurred or is reasonably expected
to incur liability in excess of $1,000,000; or
(r) a Termination Event (other than a Termination Event based upon
an Insolvency Event) under any Receivables Purchase Agreement shall occur.
then, if any of the events set forth in paragraphs (a), (d), (e), (f), (g), (i),
(j), (k), (l), (m), (n), (o), (p) or (q) above shall have occurred, a "Trust
Early Amortization Event" shall occur without any notice, demand, protest or
other requirement of any kind immediately upon the occurrence of such event,
and, if any of the events set forth in paragraphs (b), (c), (h) or (r) above
shall have occurred, the Trustee may (and, if directed to do so by a Majority in
Interest of any outstanding Series or, if the related Supplement so provides,
the Enhancement Provider for such Series, shall), by notice to the Transferor,
the Servicer, and each Enhancement Provider, declare that a "Trust Early
Amortization Event" shall occur as of the date set forth in such notice. Upon
the occurrence of either (i) a Trust Early Amortization Event or (ii) an event
described in clause (a) of the definition "Insolvency Event" (without giving
effect to the 60-day grace period therein) with respect to the Transferor or any
Originator, then additional Receivables will not be transferred to the Trust;
provided, however, that if (x) an event described in the preceding clause (ii)
shall occur and (y) in clause (a) of the definition of "Insolvency Event" within
the 60-day grace period referred to each case, decree or order giving rise to
such event shall have been stayed, dismissed or otherwise rescinded, then, so
Pooling and Servicing Agreement
79
long as no Trust Early Amortization Event shall have occurred, additional
Receivables shall thereafter be transferred to the Trust as if such case, decree
or order had not been filed. The Trustee shall be deemed to have knowledge of a
Trust Early Amortization Event only if a Responsible Officer of the Trustee has
actual knowledge or if a Responsible Officer of the Trustee has received written
notice thereof.
A Majority in Interest of each outstanding Series (or, if so
specified in the related Supplement, each Enhancement Provider for such Series)
may, on behalf of all Certificateholders, waive any default (other than a
default described in paragraph (e) above) by the Transferor or the Servicer in
the performance of their obligations hereunder and its consequences, except the
failure to make any distributions or payments required to be made to
Certificateholders or to make any required deposits of any amounts to be so
distributed or paid. Holders of Certificates evidencing 67% or more of the
aggregate Certificateholders' Interest of each outstanding Series (or, if so
specified in the related Supplement, each Enhancement Provider for such Series)
may, on behalf of all Certificateholders, waive any default described in
paragraph (e) above and its consequences. No such waiver shall extend to any
subsequent or other default or impair any right consequent thereon except to the
extent expressly so waived.
SECTION 9.02. Additional Rights upon the Occurrence of Any Trust
Early Amortization Event. (a) Upon the occurrence and during the continuance of
any Trust Early Amortization Event, in addition to all other rights and remedies
under this Agreement or otherwise and all other rights and remedies provided
under the UCC of the applicable jurisdiction and other applicable laws (which
rights shall be cumulative), each of the Servicer, at the direction of the
Trustee, and the Trustee may exercise any and all rights and remedies of the
Transferor under or in connection with the Receivables Purchase Agreements,
including, without limitation, any and all rights of the Transferor to demand or
otherwise require payment of any amount under, or performance of any provision
of, the Receivables Purchase Agreements. Further, the Trustee may exercise any
and all rights and remedies under the Parent Undertaking Agreement.
(b) If an Insolvency Event with respect to the Transferor occurs,
the Transferor shall immediately cease to transfer Receivables to the Trust and
shall promptly give written notice to the Trustee, who shall, within two
Business Days, forward such notice to the Certificateholders, each Rating
Agency, each Enhancement Provider and the Servicer of such event.
Notwithstanding the above, Receivables transferred to the Trust prior to the
occurrence of such Insolvency Event and collections relating to such Receivables
shall continue to be part of the Trust. Unless, within 10 Business Days of the
date of the notice provided for above, the Trustee receives written instructions
from a Majority in Interest of each outstanding Series (or, if so specified in
the related Supplement, the Enhancement Provider for the Series) instructing the
Trustee not to sell, dispose of or liquidate the Receivables, the Trustee or its
agent shall promptly proceed to sell, dispose of, or otherwise liquidate the
Receivables in a
Pooling and Servicing Agreement
80
commercially reasonable manner and on commercially reasonable terms; provided,
however, that, if the amount available to the Trust for distribution after such
sale, disposition or liquidation would be less than the aggregate principal
amount of the Investor Certificates plus any unpaid Discount Amount thereon
through the Distribution Date next succeeding the date of such sale, the Trustee
or its agent shall not proceed with such sale, disposition or liquidation unless
a Majority in Interest of each outstanding Series (or, if so specified in the
related Supplement, the Enhancement Provider for such Series) shall have
consented in writing thereto. The proceeds from such sale, disposition or
liquidation of the Receivables shall be treated as Collections on the
Receivables and shall be distributed in accordance with the terms of this
Agreement after being deposited in the Concentration Account.
ARTICLE X
SERVICER DEFAULTS
SECTION 10.01. Servicer Defaults. If any one of the following events
(each being a "Servicer Default") shall occur and be continuing:
(a) any failure by the Servicer to make any payment, transfer or
deposit (including pursuant to Section 3.04(b)), or, if applicable, to
give instructions or notice to the Trustee to make such payment, transfer
or deposit, or to give notice to the Trustee as to any action to be taken
under any Enhancement Agreement, or any failure to provide a Determination
Date Certificate to the Trustee within two Business Days after the same
shall become due; or
(b) the Servicer shall fail to observe or perform any other covenant
or agreement applicable to it contained herein which has a material
adverse effect on any Beneficiary if such failure shall remain unremedied
for ten days; or
(c) any representation, warranty or certification made by the
Servicer under or in connection with this Agreement, or in any certificate
or information delivered pursuant to or in connection with this Agreement,
shall prove to have been incorrect in any respect when made and which has
a material adverse effect on the interests of any Beneficiary; or
(d) an Insolvency Event shall occur with respect to the Servicer; or
(e) the Servicer assigns its duties under this Agreement, except as
specifically permitted by Section 8.02;
then, as long as such Servicer Default shall not have been remedied and is
continuing, either
Pooling and Servicing Agreement
81
the Trustee (unless otherwise directed by a Majority in Interest of each
outstanding Series or, if so specified in the related Supplement, the
Enhancement Provider for such Series) or the Majority in Interest of each Series
(or, if so specified in the related Supplement, the Enhancement Provider for
such Series), by notice then given in writing to the Servicer (and to the
Trustee if given by such Investor Certificateholders) (each such being a
"Termination Notice"), may terminate all but not less than all the rights and
obligations of the Servicer as Servicer under this Agreement. The Trustee shall
be deemed to have knowledge of a Servicer Default only if a Responsible Officer
of the Trustee has actual knowledge or if a Responsible Officer of the Trustee
has received written notice thereof.
Notwithstanding the foregoing, a delay in or failure of performance
referred to in Section 10.01(a) or (b) for a period of five Business Days shall
not constitute a Servicer Default if such delay or failure could not have been
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, union strikes, work stoppages
or similar causes. The preceding sentence shall not relieve the Servicer from
using its best efforts to perform its obligations in a timely manner in
accordance with the terms of this Agreement, and the Servicer shall provide the
Trustee, the Transferor, any Enhancement Provider and the Investor
Certificateholders with an Officer's Certificate giving prompt notice of such
failure or delay by it, together with a description of its efforts so to perform
its obligations.
A Majority in Interest of each outstanding Series (or, if so
specified in the related Supplement, the Enhancement Provider for such Series)
may, on behalf of all Certificateholders, waive any default by the Servicer in
the performance of its obligations hereunder and its consequences, except the
failure to make any distributions or payments required to be made to
Certificateholders or to make any required deposits of any amounts to be so
distributed or paid. No such waiver shall extend to any subsequent or other
default or impair any right consequent thereon except to the extent expressly so
waived.
After receipt by the Servicer of a Termination Notice, and on the
date that a Successor Servicer shall have been appointed by the Trustee pursuant
to Section 10.02, all authority and power of the Servicer under this Agreement
shall pass to and be vested in such Successor Servicer (a "Service Transfer")
and, without limitation, the Trustee is hereby authorized, empowered and
instructed (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, at its expense, with the Trustee and
such Successor Servicer in (i) effecting the termination of the responsibilities
and rights of the Servicer to conduct servicing hereunder, including, without
limitation, the transfer to such Successor Servicer of all authority of the
Servicer to service the
Pooling and Servicing Agreement
82
Receivables as provided under this Agreement, including all authority over all
Collections which shall on the date of such Service Transfer be held by the
Servicer for deposit to the Concentration Account, any Xxxxxxxxxx Collection
Account, the Trustee's Account or the Transferor's Account, or which have been
deposited by the Servicer to the Concentration Account, any Xxxxxxxxxx
Collection Account, or any other account, or which shall thereafter be received
with respect to the Receivables, (ii) taking such measures as shall be
reasonably requested by the Transferor to protect and maintain the security and
confidentiality of all Confidential Information in accordance with Section 8.07
and (iii) assisting the Successor Servicer until all servicing activities have
been transferred to such Successor Servicer, such assistance to include, without
limitation, (x) assisting any accountants selected by the Successor Servicer to
verify collection records and reports made prior to the Service Transfer and (y)
assisting to make the computer systems of the Servicer and the Successor
Servicer compatible to the extent necessary to effect the Servicer Transfer. The
Servicer shall, at its expense, within five Business Days of such Service
Transfer, (A) assemble such documents, instruments and other records (including
computer tapes and disks), which evidence the Receivables and the other Trust
Assets, and which are necessary or desirable to collect the Receivables, and
shall make the same available to the Successor Servicer or the Trustee or its
designee at a place selected by the Successor Servicer or the Trustee and in
such form as the Successor Servicer or the Trustee may reasonably request, and
(B) segregate all cash, checks and other instruments received by it from time to
time constituting Collections of Receivables in a manner acceptable to the
Successor Servicer and the Trustee, and, promptly upon receipt, remit all such
cash, checks and instruments to the Successor Servicer or the Trustee or its
designee.
At any time following a Termination Notice:
(1) the Servicer shall, at the Trustee's request and at the
Servicer's expense, give notice of the Trust's ownership of the
Receivables to the related Obligors and direct that payments be made
directly to the Trustee or its designee;
(2) if the Servicer fails to provide the notice to the Obligors
required in paragraph (1) above, the Trustee may direct the Obligors of
Receivables, or any of them, that payment of all amounts payable under any
such Receivables be made directly to the Trustee or its designee; and
(3) each of the Transferor and each Certificateholder hereby
authorizes the Trustee to take any and all steps in the Transferor's name
and on behalf of the Transferor and the Certificateholders necessary or
desirable, in the determination of the Trustee, to collect all amounts due
under any and all Receivables, including, without limitation, endorsing
the Transferor's name on checks and other instruments representing
Collections in respect of such Receivables and enforcing such Receivables.
Pooling and Servicing Agreement
83
SECTION 10.02. Trustee to Act; Appointment of Successor Servicer.
(a) On and after the receipt by the Servicer of a Termination Notice pursuant to
Section 10.01 or upon a resignation by the Servicer pursuant to Section 8.05,
the Servicer shall continue to perform all servicing functions under this
Agreement until (i) in the case of any such receipt, the date specified in such
Termination Notice or otherwise specified by the Trustee in writing or, if no
such date is specified in such Termination Notice or otherwise specified by the
Trustee, until the earlier of a date agreed upon by the Servicer and the Trustee
and a date specified by the Trustee in a written notice to the Servicer and (ii)
in the case of any such resignation, until the Trustee or a Successor Servicer
shall have assumed the responsibilities and obligations of the Servicer pursuant
to this Section 10.02. The Trustee shall as promptly as possible after the
giving of a Termination Notice or such a resignation appoint an Eligible
Servicer (which may be Citibank, N.A.) as a successor servicer (the "Successor
Servicer"), subject to the consent of any Enhancement Provider which consent
shall not be unreasonably withheld or delayed and if specified in any
Supplement, the consent of a Majority in Interest of such Series, which consent
shall not be unreasonably withheld or delayed, and such Successor Servicer shall
accept its appointment by a written assumption in a form acceptable to the
Trustee. In the event that a Successor Servicer has not been appointed or has
not accepted its appointment by the earlier of 30 days after the date of such
Termination Notice or at the time when the Servicer ceases to act as Servicer,
the Trustee without further action shall automatically be appointed the
Successor Servicer. The Trustee may delegate any of its servicing obligations to
an affiliate or agent of the Trustee in accordance with the terms of this
Agreement. Notwithstanding the foregoing, the Trustee shall, if it is unable or
unwilling so to act as Successor Servicer, petition a court of competent
jurisdiction to appoint any established institution that is an Eligible Servicer
(other than the Trustee) as the Successor Servicer hereunder.
(b) Upon its appointment, the Successor Servicer shall be the
successor in all respects to the Servicer with respect to servicing functions
under this Agreement and shall be subject to all the responsibilities, duties
and liabilities relating thereto placed on the Servicer by the terms and
provisions hereof, and all references in this Agreement to the Servicer shall be
deemed to refer to such Successor Servicer; provided, however, that neither the
Trustee (solely in its capacity as such) nor any Successor Servicer shall be
deemed in default hereunder as a result of the predecessor Servicer's failure to
deliver necessary Trust Assets, documents, or records to the Trustee (solely in
its capacity as such) or to such Successor Servicer; and provided further that
the Successor Servicer shall not be liable for any acts or omissions of the
Servicer occurring prior to such succession or for any breach by the Servicer of
any of its representations and warranties contained herein or in any related
document or agreement. The Successor Servicer shall be reimbursed by the
Transferor for any reasonable transition fees, costs and out-of-pocket expenses
incurred in connection with a Service Transfer in accordance with Section
3.02(b). Any Successor Servicer, by its acceptance of its appointment, will
automatically agree to be bound by the terms and provisions of any Enhancement
Agreement.
Pooling and Servicing Agreement
84
(c) In connection with any Termination Notice, the Trustee shall be
permitted to appoint any Eligible Servicer as a Successor Servicer for servicing
compensation not in excess of the Servicing Fee, unless the Trustee shall agree
to pay the excess over the Servicing Fee of the compensation of any such
Successor Servicer and such excess shall not be unreasonable under the
applicable circumstances.
(d) All authority and power granted to the Successor Servicer under
this Agreement shall automatically terminate upon termination of the Trust 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 Successor Servicer, as attorney-in-fact or otherwise, all documents and
other instruments, and to do and accomplish all other acts or things, necessary
or appropriate to effect the purposes of such transfer of servicing rights. The
Successor Servicer agrees to cooperate with the Transferor in effecting the
termination of the responsibilities and rights of the Successor Servicer to
conduct servicing of the Receivables. Upon such termination of the Trust, the
Successor Servicer shall transfer its electronic records relating to the
Receivables to the Transferor in such electronic form as the Transferor may
reasonably request and shall transfer all other records, correspondence and
documents to the Transferor in the manner and at such times as the Transferor
shall reasonably request.
SECTION 10.03. Notification to Certificateholders. Promptly and in
any event within two Business Days after a Responsible Officer of the Servicer
obtains knowledge of any Servicer Default, the Servicer shall give written
notice thereof to a Responsible Officer of the Trustee, and the Trustee shall
promptly deliver a copy of such notice to the Certificateholders, each
Enhancement Provider and each Rating Agency. Upon any termination or appointment
of a Successor Servicer pursuant to this Article X, the Trustee shall give
prompt written notice thereof to the Transferor and the Certificateholders.
ARTICLE XI
THE TRUSTEE
SECTION 11.01. Duties of the Trustee. (a) Other than while acting in
its capacity as Successor Servicer, the Trustee, prior to the occurrence of a
Servicer Default of which a Responsible Officer of the Trustee has actual
knowledge and after the curing of all Servicer Defaults which may have occurred,
undertakes to perform such duties and only such duties as are specifically set
forth in this Agreement, and no implied duties or covenants shall be read into
this Agreement against the Trustee. If a Responsible Officer of the Trustee has
actual knowledge that a Servicer Default has occurred (which has not been cured
or waived), the Trustee shall exercise such of the rights and powers vested in
it by this Agreement and use the same degree of care and skill in their
exercise, as a prudent person would exercise or use under the circumstances in
the conduct of his or her own affairs.
Pooling and Servicing Agreement
85
(b) The Trustee, upon receipt of any resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee which are specifically required to be furnished pursuant to any
provision of this Agreement or any Supplement, shall examine them to determine
whether they substantially conform to the requirements of this Agreement or any
Supplement. The Trustee shall give prompt written notice to the
Certificateholders, any Enhancement Provider and each Rating Agency of any
material lack of conformity of any such instrument to the applicable
requirements of this Agreement or any Supplement discovered by the Trustee which
would entitle any Enhancement Provider or a specified percentage of the Investor
Certificateholders to take any action pursuant to this Agreement or any
Supplement.
(c) Subject to Section 11.01(a), no provision of this Agreement
shall be construed to relieve the Trustee from liability for its own grossly
negligent action, its own grossly negligent failure to act or its own willful
misconduct; provided, however, that:
(i) the Trustee shall not be personally liable for an error of
judgment made in good faith by a Responsible Officer or Responsible
Officers of the Trustee, unless it shall be proved that the Trustee was
grossly negligent in ascertaining the pertinent facts;
(ii) the Trustee shall not be personally liable with respect to any
action taken, suffered or omitted to be taken by it in good faith in
accordance with the direction of a Majority in Interest of each
outstanding Series relating to the time, method and place of conducting
any proceeding for any remedy available to the Trustee in accordance with
the terms of this Agreement, or exercising any trust or power conferred
upon the Trustee, under this Agreement; and
(iii) the Trustee shall not be charged with knowledge of any failure
by the Servicer to comply with the obligations of the Servicer referred to
in Section 10.01 or of any Trust Early Amortization Event unless a
Responsible Officer of the Trustee obtains actual knowledge of such
failure or such event or the Trustee receives written notice of such
failure or such event from the Servicer, each Enhancement Provider or the
Certificateholders of any outstanding Series evidencing not less than 20%
of the Invested Amount for such Series.
(d) The Trustee shall not be required to expend or risk its own
funds or otherwise incur financial liability in the performance of any of its
duties hereunder or under any Supplement or in the exercise of any of its rights
or powers if there is reasonable grounds for believing that the repayment of
such funds or indemnity satisfactory to it against such risk or liability is not
reasonably assured to it, and none of the provisions contained in this Agreement
shall in any event require the Trustee to perform, or be responsible for the
manner
Pooling and Servicing Agreement
86
of performance of, any obligations of the Servicer under this Agreement except
during such time, if any, as the Trustee shall be the successor to, and be
vested with the rights, duties, powers and privileges of, the Servicer in
accordance with the terms of this Agreement.
(e) Except for actions expressly authorized by this Agreement, the
Trustee shall take no action reasonably likely to impair the interests of the
Trust in any Receivable now existing or hereafter created or to impair the value
of any Receivable now existing or hereafter created.
(f) Except as expressly provided in this Agreement, the Trustee
shall have no power to vary the corpus of the Trust including, without
limitation, by (i) accepting any substitute obligation for a Receivable
initially Transferred to the Trust under Section 2.01, (ii) adding any other
investment, obligation or security to the Trust, or (iii) withdrawing from the
Trust any Receivable.
(g) In the event that the Transfer Agent and Registrar shall fail to
perform any obligation, duty or agreement in the manner or on the day required
to be performed by the Transfer Agent and Registrar, as the case may be, under
this Agreement or under any Supplement, the Trustee shall be obligated promptly
upon its actual knowledge thereof to perform such obligation, duty or agreement
in the manner so required.
(h) The Trustee shall have no responsibility or liability for the
selection of, or investment losses on, Eligible Investments.
(i) Notwithstanding any other provision contained herein, the
Trustee is not acting as, and shall not be deemed to be, a fiduciary for any
Enhancement Provider in its capacity as such or as a Beneficiary, and the
Trustee's sole responsibility with respect to any such Enhancement Provider
shall be to perform those duties with respect to any such Enhancement Provider
as are specifically set forth herein, and no implied duties or obligations shall
be read into this Agreement against the Trustee with respect to any such
Enhancement Provider.
(j) The Trustee shall notify each Rating Agency and each Enhancement
Provider (i) of any notice which the Trustee receives pursuant to Section
2.05(g)(i), 2.05(h) or 3.04(h)(i), (ii) of any change in any rating of the
Certificates of any other Rating Agency and (iii) immediately of the occurrence
of any Trust Early Amortization Event under Article IX.
(k) The Trustee shall, with respect to each Daily Report (upon which
the Trustee may conclusively rely), (A) compare the Collections reported that
day by the Servicer to the actual Collections deposited to the Collection
Account, (B) with respect to the reconciliation of each of the trust accounts,
compare the beginning balance as reported by the Servicer to the amount on
deposit in the trust accounts per the accounting records of the
Pooling and Servicing Agreement
87
Trustee and (C) perform each of the account transfers set forth in the Daily
Report, as directed by the Servicer.
(l) The Trustee shall follow the following procedures with respect
to each Determination Date Certificate (upon which the Trustee may conclusively
rely):
(i) with respect to the reconciliation of each of the trust
accounts, compare the beginning and ending balances to the amounts which
were on deposit in the trust accounts per the accounting records of the
Trustee as of the applicable date; and
(ii) examine potential Early Amortization Events for positive
indications by the Servicer of Early Amortization Events pursuant to such
requirement in each applicable supplement.
(m) Notwithstanding any other provision of this Agreement or any
Supplement, upon discovery of any material discrepancy between the amounts
reported by the Servicer and the amounts calculated as provided above, the
Servicer shall have ten days to resolve such discrepancy before the Trustee
shall be obligated to give notice to the Certificateholders, each Enhancement
Provider and each Rating Agency.
SECTION 11.02. Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 11.01:
(a) the Trustee may conclusively rely on and shall be fully
protected in acting on, or in refraining from acting in accord with, any
resolution, Officer's Certificate, certificate of auditors or any other
certificate, statement, instrument, opinion, report, notice, request,
consent, order, appraisal, bond or other paper or document believed by it
in good faith to be genuine and to have been signed or presented to it
pursuant to this Agreement by the proper party or parties;
(b) the Trustee may consult with counsel and, as a condition to
taking, suffering or omitting to take any action, may demand an Opinion of
Counsel, and any advice or opinion of counsel shall be full and complete
authorization and protection in respect of any action taken or suffered or
omitted by it hereunder in good faith and in accordance with such advice
or opinion of counsel;
(c) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement, or to institute, conduct
or defend any litigation hereunder or in relation hereto, at the request,
order or direction of any of the Certificateholders, pursuant to the
provisions of this Agreement, unless such Certificateholders shall have
offered to the Trustee security or indemnity satisfactory to it against
the costs, expenses and liabilities which may be incurred therein or
thereby;
Pooling and Servicing Agreement
88
provided, however, that nothing contained herein shall relieve the Trustee
of the obligations, upon the occurrence of a Servicer Default (which has
not been cured or waived), to exercise such of the rights and powers
vested in it by this Agreement, and to use the same degree of care and
skill in their exercise as a prudent person would exercise or use under
the circumstances in the conduct of his or her own affairs;
(d) subject to Section 11.01(c), the Trustee shall not be personally
liable for any action taken, suffered or omitted by it in good faith and
believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Agreement;
(e) the Trustee shall not be bound to make any investigation into
the facts of matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal,
approval, bond or other paper or document, unless requested in writing so
to do by Certificateholders of any outstanding Series evidencing not less
than 20% of the Invested Amount for such Series or, if so specified in any
Supplement, the Enhancement Provider therefor;
(f) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys or a custodian, and the Trustee shall not be responsible for any
misconduct or negligence on the part of, or for the supervision of any
such agent, attorney or custodian appointed with due care by it hereunder;
(g) except as required by Section 11.01, the Trustee shall not be
required to make any initial or periodic examination of any documents or
records related to the Receivables for the purpose of establishing the
presence or absence of defects, the compliance by the Transferor with its
representations and warranties or for any other purpose; and
(h) nothing in this Agreement shall be construed to require the
Trustee to monitor the performance of the Servicer or act as a guarantor
of the Servicer's performance.
SECTION 11.03. Trustee Not Liable for Recitals in Certificates or
Receivables. The Trustee assumes no responsibility for the correctness of the
recitals contained herein and in the Certificates (other than the certificate of
authentication on the Certificates). Except as set forth in Section 11.15, the
Trustee makes no representations as to the validity or sufficiency of this
Agreement or of the Certificates (other than the certificate of authentication
on the Certificates) or of any Receivable or related document. The Trustee shall
not be accountable for the use or application by the Transferor of any of the
Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the
Pooling and Servicing Agreement
89
Transferor in respect of the Receivables or deposited in or withdrawn from the
Concentration Account, any Xxxxxxxxxx Collection Account, the Transferor's
Account, the Trustee's Account or any other account hereafter established to
effectuate the transactions contemplated by and in accordance with the terms of
this Agreement and any Supplement. The Trustee shall at no time
have any responsibility or liability for or with respect to the
legality, validity and enforceability of any security interest in any
Receivable, or the perfection and priority of such security interest or the
maintenance of any such perfection and priority or the accuracy, content or
completeness of any offering documents used in connection with the sale of the
Certificates.
SECTION 11.04. Trustee May Own Certificates. The Trustee in its
individual or any other capacity may become the owner or pledgee of Investor
Certificates and may otherwise deal, and transact banking business, with the
Servicer and the Transferor with the same rights as it would have if it were not
the Trustee.
SECTION 11.05. Compensation; Trustee's Expenses. (a) The Trustee
shall be entitled to receive a monthly Trustee's fee (which shall not be limited
by any provision of law in regard to the compensation of a trustee of an express
trust, such fee being the "Trustee's Fee") in respect of each Collection Period
(or portion thereof) from the date hereof until the termination of the
Amortization Period, payable in arrears on each Distribution Date in an amount
agreed upon in writing by the Trustee and the Transferor. The Trustee's Fee
shall be the aggregate of the Series Trustee's Fees specified in the
Supplements. The Trustee's Fee shall be payable, first, from Investor
Collections pursuant to, and subject to the priority of payment set forth in,
Section 5.01 of the applicable Supplement, second, to the extent not paid from
Investor Collections, by the Transferor, third, to the extent not paid from
Investor Collections or by the Transferor, by the Servicer pursuant to Section
3.02(b) and, fourth, from Xxxxxxxxxx pursuant to the Parent Undertaking
Agreement. When the Trustee incurs expenses or renders services in connection
with an Insolvency Event such expenses (including the reasonable fees and
expenses of its counsel) and the compensation for such services are intended to
constitute expenses of administration under any bankruptcy law or law relating
to creditors rights generally.
Pooling and Servicing Agreement
90
(b) Expenses. The Transferor will pay or reimburse the Trustee upon
its request or at least 5 Business Days' notice providing reasonable detail, and
if the Transferor shall fail to do so, the Servicer will so pay or reimburse the
Trustee (with a right to reimbursement from the Transferor) pursuant to Section
3.02(b), and if both the Transferor and the Servicer shall fail to do so,
Xxxxxxxxxx will so pay or reimburse the Trustee (with a right to reimbursement
from the Transferor) pursuant to the Parent Undertaking Agreement, for all
reasonable expenses, disbursements and advances incurred or made by the Trustee
in accordance with any of the provisions of this Agreement or any Supplement or
in connection with any amendment hereto (including the reasonable fees and
expenses of its agents, any co-trustee and counsel and fees incurred in
connection with a Servicer Default or a Trust Early Amortization Event) except
any such expense, disbursement or advance as may arise from its gross negligence
or willful misconduct and except as provided in the following sentence. If the
Trustee is appointed Successor Servicer pursuant to Section 10.02, the provision
of this Section 11.05 shall not apply to expenses, disbursements and advances
made or incurred by the Trustee in its capacity as Successor Servicer, which
shall be paid, first, out of the Servicing Fee and, second, to the extent not
paid out of the Servicing Fee, by the Transferor pursuant to Section 3.02(b).
The Transferor's and Servicer's covenant provided in this Section 11.05 shall
survive the termination of the Trust.
SECTION 11.06. Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be an Eligible Institution. If the Trustee
publishes reports of condition at least annually, pursuant to law or to the
requirements of any supervising or examining authority, then, for the purpose of
this Section 11.06, the combined capital and surplus of such corporation shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. In case at any time the Trustee shall cease to
be eligible in accordance with the provisions of this Section 11.06, the Trustee
shall resign immediately in the manner and with the effect specified in Section
11.07.
SECTION 11.07. Resignation or Removal of Trustee. (a) The Trustee
may at any time resign and be discharged from the trust hereby created by giving
30 days' written notice thereof to the Transferor and the Servicer. Upon
receiving such notice of resignation, the Servicer shall promptly appoint a
successor trustee acceptable to each Enhancement Provider and a Majority in
Interest of each outstanding Series by written instrument, in duplicate, one
copy of which instrument shall be delivered to the resigning Trustee and one
copy to the successor trustee. If no successor trustee shall have been so
appointed and have accepted appointment within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.
Pooling and Servicing Agreement
91
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 11.06 and shall fail to resign after
written request therefor by the Servicer, or if at any time the Trustee shall be
legally unable to act, or shall be adjudged as bankrupt or insolvent, or if a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Servicer may remove the Trustee and promptly appoint a successor trustee
acceptable to each Enhancement Provider and to a Majority in Interest of each
outstanding Series by written instrument, in duplicate, one copy of which
instrument shall be delivered to the Trustee so removed and one copy to the
successor trustee.
(c) If at any time the Trustee shall fail to perform its obligations
under this Agreement, a Majority in Interest of each outstanding Series may
remove the Trustee and direct the Servicer to promptly appoint a successor
trustee acceptable to each Enhancement Provider and to a Majority in Interest of
each outstanding Series by written instrument, in duplicate, one copy of which
instrument shall be delivered to the Trustee so removed and one copy to the
successor trustee; provided that if all other procedures fail and a successor
trustee has not accepted an appointment pursuant to this Section 11.07(c) within
30 days after the Trustee shall have received notice from the Majority in
Interest of each outstanding Series of their intention to remove such Trustee,
the Trustee may petition any court of competent jurisdiction for the appointment
of a successor trustee.
(d) Notwithstanding anything herein to the contrary, any resignation
or removal of the Trustee and appointment of successor trustee pursuant to any
of the provisions of this Section 11.07 shall not become effective until
acceptance of appointment by the successor trustee as provided in Section 11.08.
SECTION 11.08. Successor Trustee. (a) Any successor trustee
appointed as provided in Section 11.07 shall execute, acknowledge and deliver to
the Transferor, the Servicer and its predecessor Trustee an instrument accepting
such appointment hereunder, and thereupon the resignation or removal of the
predecessor Trustee shall become effective, and such successor trustee, without
any further act, deed or conveyance, shall become fully vested with all the
rights, powers, duties and obligations of its predecessor hereunder, with like
effect as if originally named as Trustee herein. The predecessor Trustee shall
deliver (with the expense therefor payable out of the Trustee's Fee, and by the
Transferor and the Servicer, pursuant to Sections 3.02(b) and 11.05(b)) to the
successor trustee all documents or copies thereof and statements held by it
hereunder, and the Transferor and the predecessor Trustee shall execute and
deliver such instruments and do such other things as may reasonably be required
for fully and certainly vesting and confirming in the successor trustee all such
rights, powers, duties and obligations.
(b) No successor trustee shall accept appointment as provided in
this Section
Pooling and Servicing Agreement
92
11.08 unless at the time of such acceptance such successor trustee shall be
eligible under the provisions of Section 11.06.
(c) Upon acceptance of appointment by a successor trustee as
provided in this Section 11.08, such successor trustee shall mail notice of such
succession hereunder to all Investor Certificateholders, each Enhancement
Provider and to and each Rating Agency.
SECTION 11.09. Merger or Consolidation of Trustee. Any Person into
which the Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Person succeeding to
the corporate trust business of the Trustee, shall be the successor of the
Trustee hereunder, provided that such corporation shall be eligible under the
provisions of Section 11.06, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
SECTION 11.10. Appointment of Co-Trustee or Separate Trustee. (a)
Notwithstanding any other provisions of this Agreement, at any time, for the
purpose of meeting any legal requirements of any jurisdiction in which any part
of the Trust may at the time be located, the Trustee shall have the power and
may execute and deliver all instruments to appoint one or more Persons to act as
a co-trustee or co-trustees, or separate trustee or separate trustees, of all or
any part of the Trust, and to vest in such Person or Persons, in such capacity
and for the benefit of the Certificateholders, such title to the Trust, or any
part thereof, and, subject to the other provisions of this Section 11.10, such
powers, duties, obligations, rights and trusts as the Trustee may consider
necessary or desirable. No co-trustee or separate trustee hereunder shall be
required to meet the terms of eligibility as a successor trustee under Section
11.06 and no notice to Certificateholders of the appointment of any co-trustee
or separate trustee shall he required under Section 11.08.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred or imposed
upon the Trustee shall be conferred or imposed upon and exercised or
performed by the Trustee and such separate trustee or co-trustee jointly
(it being understood that such separate trustee or co-trustee is not
authorized to act separately without the Trustee joining in such act),
except to the extent that, under any law of any jurisdiction in which any
particular act or acts are to be performed (whether as Trustee hereunder
or as Successor Servicer hereunder), the Trustee shall be incompetent or
unqualified to perform such act or acts, in which event such rights,
powers, duties and obligations (including the holding of title to the
Trust or any portion thereof in any such jurisdiction) shall be exercised
and performed singly by such separate trustee or co-trustee, but solely at
the direction of the Trustee;
Pooling and Servicing Agreement
93
(ii) no Trustee hereunder shall be personally liable by reason of
any act or omission of any other Trustee hereunder; and
(iii) the Trustee may at any time accept the resignation of or
remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Trustee shall
be deemed to have been given to each of the then separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article XI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in its instrument of appointment, either jointly with the
Trustee or separately, as may be provided therein, subject to all the provisions
of this Agreement, specifically including every provision of this Agreement
relating to the conduct of, affecting the liability of, or affording protection
to, the Trustee. Every such instrument shall be filed with the Trustee and a
copy thereof given to the Servicer.
(d) Any separate trustee or co-trustee may at any time constitute
the Trustee, its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all its estates,
properties, rights, remedies and trusts shall vest in and be exercised by the
Trustee, to the extent permitted by law, without the appointment of a new or
successor trustee.
SECTION 11.11. Tax Returns. No federal income tax return shall be
filed on behalf of the Trust unless either (i) the Trustee or the Servicer shall
receive an Opinion of Counsel based on a change in applicable law occurring
after the date hereof that the Internal Revenue Code requires such a filing or
(ii) the Internal Revenue Service shall determine that the Trust is required to
file such a return. In the event the Trust shall be required to file tax
returns, the Servicer shall prepare or shall cause to be prepared any tax
returns required to be filed by the Trust and shall remit such returns to the
Trustee for signature at least five days before such returns are due to be
filed. The Trustee shall promptly sign such returns and deliver such returns
after signature to the Servicer, and such returns shall be filed by the
Servicer. The Servicer in accordance with the Supplements shall also prepare or
shall cause to be prepared all tax information required by law to be distributed
to Investor Certificateholders and shall deliver such information to the Trustee
at least five days prior to the date it is required by law to be distributed to
the Certificateholders. The Trustee, upon request, will furnish the Servicer
with all such information known to the Trustee as may be reasonably required in
connection with the preparation of all tax returns of the Trust, and shall, upon
request, execute such returns. In no event shall the Trustee, the Servicer or
the Transferor be liable for any liabilities, costs or expenses of the Trust or
the Investor Certificateholders
Pooling and Servicing Agreement
94
arising out of the application of any tax law, including federal, state, foreign
or local income or franchise taxes or any other tax imposed on or measured by
income (or any interest, penalty or addition to tax with respect thereto or
arising from a failure to comply therewith).
SECTION 11.12. Trustee May Enforce Claims Without Possession of
Certificates. All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as Trustee. Any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
benefit of the Certificateholders in respect of which such judgment has been
obtained.
SECTION 11.13. Suits for Enforcement. (a) If a Servicer Default
shall occur and be continuing, the Trustee, in its discretion may, subject to
the provisions of Sections 11.01 and 11.14, proceed to protect and enforce its
rights and the rights of the Certificateholders under this Agreement by suit,
action or proceeding in equity or at law or otherwise, whether for the specific
performance of any covenant or agreement contained in this Agreement or in aid
of the execution of any power granted in this Agreement or for the enforcement
of any other legal, equitable or other remedy as the Trustee, being advised by
counsel, shall deem most effectual to protect and enforce any of the rights of
the Trustee or the Certificateholders.
(b) Nothing herein contained shall be deemed to authorize the
Trustee to authorize, consent to, accept or adopt on behalf of any
Certificateholder any plan of reorganization, arrangement, adjustment or
composition affecting the Certificates or the rights of any Holder thereof, or
to authorize the Trustee to vote in respect of the claim of any
Certificateholder in any such proceeding.
SECTION 11.14. Rights of Certificateholders to Direct Trustee. A
Majority in Interest of any outstanding Series (or, if so specified in the
related Supplement, the Enhancement Provider for such Series) shall have the
right to direct the time, method, and place of conducting any proceeding for any
remedy available to the Trustee under any Transaction Document, or exercising
any trust or power conferred on the Trustee under any Transaction Document;
provided, however, that, subject to Section 11.01, the Trustee shall have the
right to decline to follow any such direction if the Trustee after being advised
by counsel determines that the action so directed may not lawfully be taken, or
if the Trustee in good faith shall, by a Responsible Officer or Responsible
Officers of the Trustee, determine that the proceedings so directed would be
illegal or involve it in personal liability or be unduly prejudicial to the
rights of Certificateholders not parties to such direction.
SECTION 11.15. Representations and Warranties of Trustee. The
Trustee
Pooling and Servicing Agreement
95
represents and warrants that:
(a) the Trustee is a banking corporation duly organized, validly
existing and in good standing under the laws of the State of New York, and
has the power to own its assets and to transact the business in which it
is presently engaged;
(b) the Trustee has full power, authority and right to execute,
deliver and perform this Agreement, and has taken all necessary action to
authorize the execution, delivery and performance by it of this Agreement;
and
(c) this Agreement has been duly executed and delivered by the
Trustee and constitutes a legal, valid and binding obligation of the
Trustee enforceable against the Trustee in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting
creditors' rights generally, now or hereafter 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).
SECTION 11.16. Maintenance of Office or Agency. The Trustee will
maintain at its expense in New York, New York an office or agency (the
"Corporate Trust Office") where notices and demands to or upon the Trustee in
respect of the Certificates and this Agreement may be served. The Trustee
initially designates its office or agency at Four Xxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx, 00000 Attn: Corporate Trust and Agency Group/ Structured Finance, as such
office. The Trustee will give prompt written notice to the Transferor, the
Servicer and to the Certificateholders of any change in the location of the
Certificate Register or any such office or agency.
ARTICLE XII
TERMINATION
SECTION 12.01. Termination of Trust. The Trust and the respective
obligations and responsibilities of the Transferor, the Servicer and the Trustee
created hereby (other than the obligation of the Trustee to make payments to
Certificateholders as hereinafter set forth) shall terminate, except with
respect to the duties described in Sections 2.01(b), 3.02(b), 7.03, 8.04, 8.07,
11.05 and 12.02(b), upon the earlier to occur of (i) the Termination Date of the
last outstanding Series of Certificates and (ii) December 31, 2016.
SECTION 12.02. Final Distribution. (a) The Servicer shall give the
Trustee and the Trustee shall give each Certificateholder at least 30 days'
prior written notice of the date on which (i) the Trust is expected to terminate
in accordance with Section 12.01 and
Pooling and Servicing Agreement
96
(ii) the Certificateholders may surrender their Certificates for payment of the
final distribution on and cancellation of such Certificates. Such notice shall
be accompanied by an Officer's Certificate setting forth the information
specified in Section 3.06 covering the period during the then-current calendar
year through the date of such notice. Not later than five days after the Trustee
shall receive such notice, the Trustee shall mail notice to the
Certificateholders specifying (i) the date upon which such final distribution
will be made upon presentation and surrender of such Certificates at the office
or offices therein designated, (ii) the amount of any such final distribution
and (iii) that the Distribution Date otherwise applicable to such final
distribution is not applicable, payments being made only upon presentation and
surrender of such Certificates at the office or offices therein specified. Each
such Certificateholder shall surrender its Certificate to the Trustee following
receipt of the final distribution thereon. The Trustee shall give such notice to
the Transfer Agent and Registrar at the time such notice is given to the
Certificateholders.
(b) Notwithstanding the Servicer's delivery to the Trustee, or the
Trustee's delivery to the Certificateholders, of the notices required under
Section 12.02(a), all funds then on deposit in the Concentration Account, any
Xxxxxxxxxx Collection Account, any Series Account, the Transferor's Account or
the Trustee's Account shall continue to be held in trust for the benefit of the
Certificateholders, and the Trustee shall pay such funds to the
Certificateholders upon surrender of their Certificates pursuant to, and subject
to the priorities set forth in, the applicable Supplement, as if such surrender
date were on a Distribution Date (and any excess shall be paid in accordance
with the terms of any Enhancement Agreement). In the event that all
Certificateholders do not surrender their Certificates for cancellation within
six months after the date specified in the above-mentioned written notice from
the Trustee, the Trustee shall give a second written notice to the remaining
Certificateholders to surrender their Certificates for cancellation and receive
the final distribution with respect thereto. If within one year after the second
notice all the Certificates shall not have been surrendered for cancellation,
the Trustee may take appropriate steps, or may appoint an agent to take
appropriate steps, to contact the remaining Certificateholders concerning
surrender of their Certificates, and the cost thereof shall be paid out of the
funds in the Trustee's Account (if such Certificateholders are Investor
Certificateholders) or the Transferor's Account (if any such Certificateholder
is the Holder of the Transferor Certificate) held for the benefit of such
Certificateholders. The Trustee shall pay to the Transferor any monies held by
it for the payment of principal or interest that remains unclaimed for two years
after the date specified in the initial above-mentioned written notice from the
Trustee. After payment to the Transferor, Investor Certificateholders entitled
to any monies must look to the Transferor for payment as general creditors
unless an applicable abandoned property law designates another Person.
SECTION 12.03. Transferor's Termination Rights. Upon the termination
of the Trust, the indefeasible payment in full of all amounts due to the
Investor Certificateholders, payment of Trustee's fees and expenses and the
surrender of the Transferor Certificate, the Trustee shall assign and convey to
the Holder of the Transferor Certificate or
Pooling and Servicing Agreement
97
its designee, without recourse, representation or warranty (except for the
representation that each Receivable and all other Trust Assets will be free and
clear of all Liens which arose as a result of any claim against or affecting, or
any act or omission of, the Trustee in its individual capacity not related to
the transactions contemplated by the Transaction Documents), all right, title
and interest of the Trust in and to the Receivables, whether then existing or
thereafter created, and all other Trust Assets, and all proceeds thereof except
for amounts held in any account by the Trustee pursuant to Section 12.02(b). The
Trustee at the expense of the Transferor shall execute and deliver such
instruments of transfer and assignment, in each case without recourse,
representation or warranty, as shall be prepared by the Transferor for execution
by the Trustee which are reasonably requested by the Transferor to vest in the
Transferor all right, title and interest which the Trust had in the Receivables
and all other Trust Assets.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.01. Amendment. (a) This Agreement or any Supplement may
be amended from time to time by the Servicer, the Transferor and the Trustee
without the consent of any of the Investor Certificateholders (i) to cure any
ambiguity or (ii) to correct or supplement any provision herein which may be
inconsistent with any other provision herein; provided that any amendment
pursuant to this clause (a) shall not, as evidenced by an Opinion of Counsel,
adversely affect in any material respect the interests of any Beneficiary.
(b) This Agreement or any Supplement may be amended from time to
time by the Servicer, the Transferor and the Trustee, so long as the Rating
Agency Condition is satisfied, with the consent of a Majority in Interest of
each adversely affected Series (or, if so specified in the related Supplement,
the Enhancement Provider for such Series), 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 the
Certificateholders; provided, however, that no such amendment shall (i) reduce
in any manner the amount of, or delay the timing of, distributions to be made to
any Certificateholder or deposits of amounts to be so distributed or the amount
available under any Enhancement without the consent of each such
Certificateholder, (ii) change the definition of or the manner of calculating
the Certificateholders' Interest or the Aggregate Certificateholders' Interest
or any Investor Certificateholder's interest therein without the consent of each
affected Investor Certificateholder or (iii) reduce the aforesaid percentage
required to consent to any such amendment without the consent of each Investor
Certificateholder. The Trustee may request an Officer's Certificate and Opinion
of Counsel with respect to an amendment entered into pursuant to this Section
13.01(b) concerning compliance with the requirements of this Agreement. Any
amendment to be effected pursuant to this paragraph shall be deemed to
Pooling and Servicing Agreement
98
adversely affect all outstanding Series, other than any Series with respect to
which such action shall not, as evidenced by an Opinion of Counsel (which
counsel shall not be an employee of, or counsel for, Xxxxxxxxxx, the Servicer or
the Transferor), addressed and delivered to the Trustee adversely affect the
interests of any Investor Certificateholder of such Series.
(c) Promptly after the execution of any such amendment or consent
(other than an amendment pursuant to Section 13.01(a)), the Trustee shall
furnish written notification of the substance of such amendment to each Rating
Agency, Investor Certificateholder and Enhancement Provider.
(d) It shall not be necessary for the consent of Investor
Certificateholders under this Section 13.01 to approve the particular form of
any proposed amendment, but it shall be sufficient if such consent shall approve
the substance thereof. The manner of obtaining such consents and of evidencing
the authorization of the execution thereof by Investor Certificateholders shall
be subject to such reasonable requirements as the Trustee may prescribe.
(e) Notwithstanding anything in this Section 13.01 to the contrary,
no amendment may be made to this Agreement or any Supplement which would
adversely affect the interests of any Enhancement Provider without the consent
of such Enhancement Provider.
(f) Any supplement executed in accordance with the provisions of
Section 6.08 shall not be considered an amendment to this Agreement for the
purposes of this Section 13.01.
(g) Prior to the execution of any amendment to this Agreement or any
Supplement, the Trustee and any Enhancement Provider shall be entitled to
receive and rely upon an Opinion of Counsel stating that the execution of such
amendment is authorized or permitted by this Agreement. The Trustee may, but
shall not be obligated to, enter into any such amendment which adversely affects
its own rights, duties, indemnities or immunities in its individual capacity
under this Agreement, any Supplement or otherwise.
SECTION 13.02. Protection of Right, Title and Interest to Trust. (a)
The Servicer shall cause this Agreement, all amendments hereto and all financing
statements and continuation statements and any other necessary documents
covering the Certificateholders' and the Trustee's right, title and interest in
and to the Trust to be promptly recorded, registered and filed, and at all times
to be kept recorded, registered and filed, all in such manner and in such places
as may be required by law to preserve and protect fully the right, title and
interest of the Certificateholders and the Trustee hereunder in and to all
property comprising the Trust. The Servicer shall deliver to the Trustee
file-stamped copies of, or filing receipts for, each document recorded,
registered or filed as provided above, as soon as available following such
recording, registration or filing. The Transferor shall cooperate fully
Pooling and Servicing Agreement
99
with the Servicer in connection with the obligations set forth above and will
execute any and all documents reasonably required to fulfill the intent of this
Section 13.02(a).
(b) Within 45 days after the Transferor makes any change in its
name, identity or legal structure which would make any financing statement or
continuation statement filed in accordance with the terms of this Agreement
seriously misleading within the meaning of Section 9-402(7) (or any comparable
provision) of the UCC as in effect in the State of New York or in the
jurisdiction the law of which governs the perfection of the interest in the
Trust Assets created hereunder, the Transferor shall give the Trustee written
notice of such change and shall file such financing statements or amendments as
may be necessary to continue the perfection of the Trust's interest in the Trust
Assets and the proceeds thereof contemplated by Section 2.01.
(c) The Transferor and the Servicer will give the Trustee prompt
written notice of any relocation of the office from which it services
Receivables or keeps records concerning the Receivables or of its principal
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 or continuation statement 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 Trust's interest in
the Receivables and the other Trust Assets and the proceeds thereof contemplated
by Section 2.01. The Transferor and the Servicer will at all times maintain each
office from which it services Receivables and its principal executive offices
within the United States of America.
SECTION 13.03. Limitation on Rights of Certificateholders. (a) The
death or incapacity of any Investor Certificateholder shall not operate to
terminate this Agreement or the Trust, nor shall such death or incapacity
entitle such Investor Certificateholders' legal representatives or heirs to
claim an accounting or to take any action or commence any proceeding in any
court for a partition or winding up of the Trust, nor otherwise affect the
rights, obligations and liabilities of the parties hereto or any of them.
(b) No Certificateholder shall have the right to vote (except as
expressly provided in this Agreement, including, without limitation, under
Section 11.14) or in any manner otherwise control the operation and management
of the Trust, or the obligations of the parties hereto, nor shall anything
herein set forth, or contained in the terms of the Certificates, be construed so
as to constitute the Certificateholders from time to time as partners or members
of an association for any reason, nor shall any Investor Certificateholder be
under any liability to any third person by reason of any action taken by the
parties to this Agreement pursuant to any provision hereof.
(c) No Investor Certificateholder shall have any right by virtue of
any provisions of this Agreement to file or otherwise institute any suit, action
or proceeding in
Pooling and Servicing Agreement
100
equity or at law upon or under or with respect to this Agreement, unless such
Investor Certificateholder previously shall have made, and unless a Majority in
Interest of each outstanding Series shall have made, a written request to the
Trustee to institute such action, suit or proceeding in its own name as Trustee
hereunder and shall have offered to the Trustee such reasonable indemnity as it
may require against the costs, expenses and liabilities to be incurred therein
or thereby, and the Trustee, for 60 days after such request and offer of
indemnity, shall have failed to file or otherwise refused to institute any such
action, suit or proceeding; it being understood, intended, and expressly
covenanted, by each Certificateholder with every other Certificateholder and the
Trustee, that no one or more Certificateholders shall have any right in any
manner whatever by virtue or by availing itself or themselves of any provisions
of this Agreement to affect, disturb or prejudice the rights of the Holders of
any of the Investor Certificates, or to obtain or seek to obtain priority over
or preference to any such Investor Certificateholder, or to enforce any right
under this Agreement, except in the manner herein provided. For the protection
and enforcement of the provisions of this Section 13.03, each and every Investor
Certificateholder and the Trustee shall be entitled to such relief as can be
given either at law or in equity. Notwithstanding any other provision of this
Agreement, the Certificates or any Supplement, each Investor Certificateholder
shall have the right to receive the payments of all amounts due hereunder under
the Certificates held by such Holder and under the Supplement relating to the
Series of Certificates held by such Holder and the right to institute suit for
the enforcement of any such payment without the consent of the Trustee or any
other Holder.
(d) By its acceptance of the Transferor Certificate, the Holder
thereof agrees that it will take no action with respect to such Holder's rights
under this Agreement that is inconsistent with, or adverse to, the interests of
any Beneficiary.
SECTION 13.04. Notices; Payments. (a) All notices and other
communications provided for hereunder shall, unless otherwise stated herein, be
in writing (including telex and facsimile communication) and shall be personally
delivered or sent by certified mail, postage prepaid, or overnight courier or
facsimile, to the intended party at the address or facsimile number of such
party set forth below or at such other address or facsimile number as shall be
designated by such party in a written notice to the other parties hereto. All
such notices and communications shall be effective (a) if personally delivered,
when received, (b) if sent by certified mail, four Business Days after having
been deposited in the mail, postage prepaid, (c) if sent by overnight courier,
two Business Days after having been given to such courier, unless sooner
received by the addressee and (d) if transmitted by facsimile, when sent, upon
receipt confirmed by telephone or electronic means. Notices and communications
sent hereunder on a day that is not a Business Day shall be deemed to have been
sent on the following Business Day.
Pooling and Servicing Agreement
101
If to the Transferor,
Muehlstein Financial Corporation
c/o X. Xxxxxxxxxx & Co., Inc.
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Tel.: (000) 000-0000
Fax: (000) 000-0000
Attn.: Xxxxxx X. Xxxxxxx
If to the Servicer,
X. Xxxxxxxxxx & Co., Inc.
000 Xxxxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Tel.: (000) 000-0000
Fax: (000) 000-0000
Attn.: Xxxxxx X. Xxxxxxx
If to the Trustee,
Bankers Trust Company, as Trustee
Xxxx Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel.: (000) 000-0000
Fax: (000) 000-0000
Attn.: Corporate Trust and Agency Group/Structured Finance
If to the Transfer Agent and Registrar,
Bankers Trust Company
Four Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Tel.: (000) 000-0000
Fax: (000) 000-0000
Attn.: Corporate Trust and Agency Group/Structured Finance
If to the Enhancement Provider or to the Program Agent, to the
address of such Person specified in the related Supplement.
If the Servicer is not Muehlstein, notices shall be given to the
Servicer at the
Pooling and Servicing Agreement
102
address designated by such Servicer, with a copy to Muehlstein at the address
designated above.
(b) Any notice required or permitted to be mailed to an Investor
Certificateholder shall be given by first-class mail, postage prepaid, at the
address of such Certificateholder as shown in the Certificate Register. Notice
so mailed within the time prescribed in this Agreement shall be conclusively
presumed to have been duly given, whether or not the Certificateholder receives
such notice.
(c) If the Transferor is not the Holder of the Transferor
Certificate, the Holder of the Transferor Certificate shall be entitled to
receive all notices which the Investor Certificateholders receive.
SECTION 13.05. Rule 144A Information. For so long as any of the
Investor Certificates of any Series are "restricted securities" within the
meaning of Rule 144(a)(3) under the Act, the Transferor, the Servicer and any
Enhancement Provider agree to cooperate with each other to provide to each
Investor Certificateholder of such Series and to each prospective purchaser of
Investor Certificates designated by such an Investor Certificateholder, upon the
request of such Investor Certificateholder or prospective purchaser, any
information required to be provided to such holder or prospective purchaser to
satisfy the condition set forth in Rule 144A(d)(4) under the Act (or any
successor provision).
SECTION 13.06. 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 covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other covenants, agreements, provisions or terms of this
Agreement or of the Certificates or rights of the Certificateholders.
SECTION 13.07. Assignment. Notwithstanding anything to the contrary
contained herein, (i) this Agreement may not be assigned by the Transferor and
(ii) except as provided in Section 8.02, this Agreement may not be assigned by
the Servicer without the prior consent of a Majority in Interest of each
outstanding Series.
SECTION 13.08. Certificates Nonassessable and Fully Paid. It is the
intention of the parties to this Agreement that the Certificateholders shall not
be personally liable for obligations of the Trust, that the interests in the
Trust represented by the Certificates shall be nonassessable for any losses or
expenses of the Trust or for any reason whatsoever and that Certificates upon
authentication thereof by the Trustee pursuant to Section 6.02 are and shall be
deemed fully paid.
SECTION 13.09. Further Assurances. The Transferor and the Servicer
agree
Pooling and Servicing Agreement
103
to do and perform, from time to time, any and all acts and to execute any and
all further instruments and documents required or reasonably requested by the
Trustee more fully to effect the purposes of this Agreement, including, without
limitation, the execution of any financing statements or continuation statements
relating to the Receivables for filing under the provisions of the UCC of any
applicable jurisdiction.
SECTION 13.10. Nonpetition Covenant. Notwithstanding any prior
termination of the Trust, (a) the Servicer, the Trustee and the
Certificateholders shall not, prior to the date which is one year and one day
after the termination of the Trust, acquiesce, petition or otherwise invoke or
cause the Trust or the Transferor to invoke the process of any Governmental
Authority for the purpose of commencing or sustaining a case against the Trust
or the Transferor under any federal or state bankruptcy, insolvency or similar
law or appointing a receiver, liquidator, assignee, trustee, custodian,
sequestrator or other similar official of the Trust or the Transferor or any
substantial part of its property or ordering the winding-up or liquidation of
the affairs of the Trust or the Transferor and (b) the Transferor shall not,
prior to the date which is one year and one day after the termination of the
Trust, acquiesce, petition or otherwise invoke or cause the Trust to invoke the
process of any Governmental Authority for the purpose of commencing or
sustaining a case against the Trust under any federal or state bankruptcy,
insolvency or similar law or appointing a receiver, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Trust or any
substantial part of its property or ordering the winding-up or liquidation of
the affairs of the Trust. Notwithstanding the foregoing, nothing herein will
prohibit the Trustee from filing proofs of claim or otherwise participate in any
such proceedings instituted by any other Person.
SECTION 13.11. No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of any Person, any right,
remedy, power or privilege hereunder shall operate as a waiver thereof, nor
shall any single or partial exercise of any right, remedy, power or privilege
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 herein provided are cumulative and not exhaustive of any
rights, remedies, powers and privileges provided by law.
SECTION 13.12. Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which taken together shall constitute one and the same agreement. Delivery of an
executed counterpart of a signature page to this Agreement by telecopier shall
be effective as delivery of a manually executed counterpart of this Agreement.
SECTION 13.13. Third-Party Beneficiaries. This Agreement will inure
to the benefit of and be binding upon the parties hereto, the
Certificateholders, any Enhancement
Pooling and Servicing Agreement
104
Providers and their respective successors and permitted assigns. Except as
otherwise provided in this Agreement, no other Person will have any right or
obligation hereunder.
SECTION 13.14. Actions by Certificateholders. (a) Whenever in this
Agreement a provision is made that an action may be taken or a notice given by
Investor Certificateholders, such action or notice may be taken or given by any
Investor Certificateholder, unless such provision requires a specific percentage
of Investor Certificateholders.
(b) Any notice, consent, waiver or other act by the Holder of a
Certificate shall bind such Holder and every subsequent Holder of such
Certificate and of any Certificate issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof in respect of anything done
or omitted to be done by the Trustee or the Servicer in reliance thereon,
whether or not notation of such action is made upon such Certificate.
SECTION 13.15. Merger and Integration. Except as specifically stated
otherwise herein, this Agreement and the other Transaction Documents set forth
the entire understanding of the parties relating to the subject matter hereof
and thereof, and all prior understandings, written or oral, are superseded by
the Transaction Documents. This Agreement may not be modified, amended, waived
or supplemented except as provided herein.
SECTION 13.16. Headings. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.
SECTION 13.17. Construction of Agreement. The Transferor hereby
grants to the Trustee on behalf of the Trust a security interest in all of the
Transferor's right, title and interest in, to and under the Receivables now
existing and hereafter created, all monies due or to become due and all amounts
received with respect thereto, and all other Trust Assets, and all "proceeds"
thereof, to secure all the Transferor's and Servicer's obligations hereunder,
including, without limitation, the Transferor's obligation to sell or transfer
to the Trust all Receivables existing on the date hereof or hereafter created
and transferred to the Transferor from time to time under the Receivables
Purchase Agreements. This Agreement shall constitute a security agreement under
applicable law.
SECTION 13.18. Governing Law; Jurisdiction; Consent to Service of
Process. (a) Governing Law. THIS AGREEMENT, INCLUDING THE RIGHTS AND DUTIES OF
THE PARTIES HERETO, SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
LAWS OF THE STATE OF NEW YORK, EXCEPT TO THE EXTENT THAT THE PERFECTION OF THE
INTERESTS OF THE TRUSTEE ON BEHALF OF THE TRUST IN THE TRUST ASSETS IS GOVERNED
BY THE LAWS OF A JURISDICTION OTHER THAN THE STATE OF NEW YORK.
Pooling and Servicing Agreement
105
(b) Jurisdiction. (i) Each of the parties hereto hereby irrevocably
and unconditionally submits, for itself and its property, to the nonexclusive
general jurisdiction of any New York State court or federal court of the United
States of America sitting in New York City, and any appellate court from any
thereof, in any action or proceeding arising out of or relating to this
Agreement or any of the other Transaction Documents to which it is a party, or
for recognition or enforcement of any judgment, and each of the parties hereto
hereby irrevocably and unconditionally agrees that all claims in respect of any
such action or proceeding may be heard and determined in any such New York State
court or, to the extent permitted by law, in such federal court. Each of the
parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law. Nothing in this Agreement shall
affect any right that any party may otherwise have to bring any action or
proceeding relating to this Agreement or any of the other Transaction Documents
in the courts of any jurisdiction.
(ii) Each of the parties hereto irrevocably and unconditionally
waives, to the fullest extent it may legally and effectively do so, any
objection that it may now or hereafter have to the laying of venue of any suit,
action or proceeding arising out of or relating to this Agreement or any of the
other Transaction Documents to which it is a party in any New York State or
federal court. Each of the parties hereto hereby irrevocably waives, to the
fullest extent permitted by law, the defense of an inconvenient forum to the
maintenance of such action or proceeding in any such court.
(c) Consent to Service of Process. Each party to this Agreement
irrevocably consents to service of process by personal delivery, certified mail,
postage prepaid or overnight courier. Nothing in this Agreement will affect the
right of any party to this Agreement to serve process in any other manner
permitted by law.
Pooling and Servicing Agreement
106
(d) Waiver of Jury Trial. Each party to this Agreement waives any
right to a trial by jury in any action or proceeding to enforce or defend any
rights under or relating to this Agreement, any other Transaction Document or
any amendment, instrument, document or agreement delivered or which may in the
future be delivered in connection herewith or therewith or arising from any
course of conduct, course of dealing, statements (whether oral or written),
actions of any of the parties hereto and the liquidity providers or any other
relationship existing in connection with this Agreement or any other Transaction
Document, and agrees that any such action or proceeding shall be tried before a
court and not before a jury.
IN WITNESS WHEREOF, the parties hereto have caused this Pooling and
Servicing Agreement to be duly executed by their respective officers thereunto
duly authorized as of the day and year first above written.
MUEHLSTEIN FINANCIAL
CORPORATION,
as Transferor
By: __________________________________
Name:
Title:
X. XXXXXXXXXX & CO., INC.,
as Servicer
By: __________________________________
Name:
Title:
BANKERS TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By: __________________________________
Name:
Title:
Pooling and Servicing Agreement
SCHEDULE 1.01
DESIGNATED COUNTRIES
Pooling and Servicing Agreement
SCHEDULE 3.03(h)
MUEHLSTEIN POST OFFICE BOXES, COLLECTION ACCOUNTS
AND CONCENTRATION ACCOUNT
X. XXXXXXXXXX POST OFFICE BOXES
================================================================================
Bank Location Post Office Box Number
--------------------------------------------------------------------------------
1. CoreStates Bank, N.A. Xxxxxxxxxxxx, XX 00000 P.O. Box 8500-55960
--------------------------------------------------------------------------------
2. CoreStates Bank, N.A. Xxxxxxxxxxxx, XX 00000 P.O. Box 8500-53580
--------------------------------------------------------------------------------
3. CoreStates Bank, N.A. Xxxxxxxxxxxx, XX 00000 P.O. Box 8500-51105
================================================================================
X. XXXXXXXXXX COLLECTION ACCOUNTS
================================================================================
Name Address and Contact ABA Number Account Number
--------------------------------------------------------------------------------
1. CoreStates Bank, N.A. 0000 Xxxxxxxx Xxxxxx 0000000000
X.X. Xxx 0000
Xxxxxxxxxxxx, XX 00000-0000
Xxxxx X. Xxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
--------------------------------------------------------------------------------
2. CoreStates Bank, N.A. 0000 Xxxxxxxx Xxxxxx 0001295314
X.X. Xxx 0000
Xxxxxxxxxxxx, XX 00000-0000
Xxxxx X. Xxxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
--------------------------------------------------------------------------------
3. Citibank N.A. Citibank, N.A. 0868-0434 (US$)
(Hong Kong) 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxx Xxxxxx
--------------------------------------------------------------------------------
4. Citibank N.A. Citibank, N.A. 0860-9381 (HK$)
(Hong Kong) 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxx Xxxxxx
--------------------------------------------------------------------------------
5. Citibank N.A. Citibank, N.A. 0/709353/012
(Singapore) 000 Xxxx Xxxxxx (XXx)
Xxx Xxxx, XX 00000
Xxxxx Xxxxxx
--------------------------------------------------------------------------------
6. Citibank N.A. Citibank, N.A. 0/709353/004
Pooling and Servicing Agreement
--------------------------------------------------------------------------------
(Singapore) 000 Xxxx Xxxxxx (Xx)
Xxx Xxxx, XX 00000
Xxxxx Xxxxxx
--------------------------------------------------------------------------------
7. Citibank N.A. Citibank, N.A. 011/3058/013
(Malaysia) 000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxx Xxxxxx
================================================================================
X. XXXXXXXXXX CONCENTRATION ACCOUNT
================================================================================
Name Address and Contact ABA Number Account Number
--------------------------------------------------------------------------------
Bankers Trust Company Four Albany Street 021-001-003 003300712
Xxx Xxxx, XX 00000
Xxxxx Xxxx
Tel: (000) 000-0000
Fax: (000) 000-0000
================================================================================
Pooling and Servicing Agreement
EXHIBIT A
FORM OF TRANSFEROR CERTIFICATE
September 25, 1996
THIS CERTIFICATE HAS NOT BEEN AND WILL NOT BE REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"). NEITHER THIS
CERTIFICATE NOR ANY PORTION HEREOF MAY BE OFFERED OR SOLD EXCEPT PURSUANT TO AN
EXEMPTION FROM THE REGISTRATION PROVISIONS OF THE SECURITIES ACT.
THE HOLDER HEREOF AGREES FOR THE BENEFIT OF THE TRUST THAT THIS
CERTIFICATE MAY NOT BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED.
MUEHLSTEIN TRADE RECEIVABLES MASTER TRUST
TRANSFEROR CERTIFICATE
THIS CERTIFICATE REPRESENTS AN UNDIVIDED INTEREST
IN CERTAIN ASSETS OF THE MUEHLSTEIN TRADE RECEIVABLES
MASTER TRUST
the corpus of which consists primarily of certain receivables generated from
time to time by X. Xxxxxxxxxx & Co., Inc. and X. Xxxxxxxxxx International, Ltd.
(the "Originators") and any other entities designated in the future as
"Originators" pursuant to the terms of the Pooling and Servicing Agreement
referred to below and purchased by Muehlstein Financial Corporation (the
"Transferor"), which in turn transfers and assigns such receivables to the
Muehlstein Trade Receivables Master Trust. This certificate does not represent
any recourse obligation of, and is not guaranteed by, the Transferor, Muehlstein
or any Affiliate of any of them.
This certifies that MUEHLSTEIN FINANCIAL CORPORATION is the
registered owner of the fractional undivided interest (the "Transferor
Interest") in the assets of the Muehlstein Trade Receivables Master Trust (the
"Trust") not represented by the Investor Certificates pursuant to that certain
Pooling and Servicing Agreement dated as of August 23, 1996 (as supplemented or
modified, the "Agreement") by and among the Transferor, X. Xxxxxxxxxx & Co., Inc
(the "Servicer"), and Bankers Trust Company (the "Trustee"). To the extent not
defined herein, the capitalized terms used herein have the meanings ascribed to
them in the Agreement.
The corpus of the Trust consists of (i) a portfolio of receivables
(the "Receivables") identified under the Agreement from time to time, (ii) funds
collected or to be collected from Obligors in respect of the Receivables, (iii)
all funds which are from time to time on deposit in the Concentration Account,
the Muehlstein Collection Accounts and any
Pooling and Servicing Agreement
A-2
other account or accounts held for the benefit of Certificateholders and (iv)
all other assets and interests constituting the Trust Assets.
This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement. Although a summary of certain
provisions of the Agreement is set forth below, this Certificate does not
purport to summarize the Agreement and is qualified in its entirety by the terms
and provisions of the Agreement, and reference is made to the Agreement for
information with respect to the interests, rights, benefits, obligations,
proceeds and duties evidenced hereby and the rights, duties and obligations of
the Trustee, the Servicer and the other parties bound by the Agreement.
This Certificate is the Transferor Certificate, which represents an
interest in the Trust, including the right to receive Collections and other
amounts at the times and in the amounts specified in the Agreement to be paid to
the holder of the Transferor Certificate. In addition to this Certificate,
Investor Certificates are being issued to investors pursuant to the Agreement,
which will represent the interests of Investor Certificateholders in the Trust.
This Certificate shall not represent any interest in the Concentration Account,
any Muehlstein Collection Account or other account or Trust Asset except as
provided in the Agreement.
Subject to certain conditions in the Agreement, the obligations
created by the Agreement and the Trust created thereby shall terminate upon the
earlier of (i) December 31, 2016 and (ii) the Termination Date of the last
outstanding Series of Certificates.
By its acceptance of this Transferor Certificate, the Holder hereof
agrees that it will take no action with respect to such Holder's rights under
the Agreement that would violate the terms of the Agreement.
Upon termination of the Trust pursuant to Article XII of the
Agreement, subject to the provisions of the Agreement, payment in full of the
Investor Certificateholders and the surrender of this Certificate, the Trustee
shall assign and convey to the Holder of the Transferor Certificate (without
recourse, representation or warranty (except for the representation that each
Receivable and all other Trust Assets will be free and clear of all Liens)) all
right, title and interest of the Trust in the Trust Assets, whether then
existing or thereafter created, including the Receivables and all proceeds
thereof, except for amounts held by the Trustee pursuant to Section 12.02(b) of
the Agreement. The Trustee shall execute and deliver such instruments of
transfer and assignment, in each case without recourse, as shall be reasonably
requested by the Transferor to vest in the Transferor all right, title and
interest which the Trust has in the Trust Assets.
Unless the certificate of authentication hereon has been executed by
or on behalf of the Trustee, by manual signature, this Certificate shall not be
entitled to any benefit under the Agreement or be valid for any purpose.
Pooling and Servicing Agreement
A-3
IN WITNESS WHEREOF, the Transferor has caused this Certificate to be
duly executed.
Dated:________________________
MUEHLSTEIN FINANCIAL
CORPORATION
By: ___________________________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Certificates described in the within-mentioned
Pooling and Servicing Agreement.
Dated: September 25, 1996
BANKERS TRUST COMPANY,
not in its individual capacity but
solely as Trustee
By: ___________________________OR
Authorized Signer
__________________________________________
Authenticating Agent for the Trustee
By: _____________________________________
Authorized Signer
Pooling and Servicing Agreement
EXHIBIT B
FORM OF ANNUAL SERVICER'S CERTIFICATE
(As required to be delivered on or before April 30 of each calendar
year beginning with April 30, 1997, pursuant to
Section 3.06 of the Pooling and Servicing Agreement)
MUEHLSTEIN FINANCIAL CORPORATION
--------------------------------
MUEHLSTEIN TRADE FINANCIAL MASTER TRUST
--------------------------------
The undersigned, chief financial officer of X. Xxxxxxxxxx & Co.,
Inc. ("Muehlstein"), as servicer (the "Servicer"), pursuant to the Pooling and
Servicing Agreement, dated as of August 23, 1996 (as amended and supplemented or
otherwise modified from time to time, the "Pooling and Servicing Agreement"), by
and among Muehlstein Financial Corporation, as transferor, X. Xxxxxxxxxx & Co.,
Inc., as servicer (the "Servicer"), and Bankers Trust Company, as trustee, do
hereby certify that:
1. Muehlstein is, as of the date hereof, the Servicer under the
Pooling and Servicing Agreement.
2. The undersigned chief financial officer is duly authorized
pursuant to the Pooling and Servicing Agreement to execute and deliver
this Certificate to the Trustee, each Rating Agency and any Enhancement
Provider.
3. A review of the activities of the Servicer during the calendar
year ended December 31, ____, and its performance under the Pooling and
Servicing Agreement was conducted under my supervision.
4. Based on such review, the Servicer has, to the best of my
knowledge, performed all of its obligations under the Pooling and
Servicing Agreement throughout such year, and no default in the
performance of such obligations has occurred or is continuing except as
set forth in paragraph 5 below.
5. The following is a description of each default in the performance
of the Servicer's obligations under the provisions of the Pooling and
Servicing Agreement known to me to have been made by the Servicer during
the calendar year ended December 31, ____, which sets forth in detail the
(a) nature of such default, (b) the action taken by the Servicer, if any,
to remedy each such default and (c) the current status of each such
default: [If applicable, insert "None."]
Capitalized terms used but not defined herein shall have the meaning
specified
Pooling and Servicing Agreement
B-2
in the Pooling and Servicing Agreement.
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this _____ day of __________, ____.
X. XXXXXXXXXX & CO., INC., or
[NAME OF SUCCESSOR SERVICER]
By: _____________________________________
Name:
Title:
Pooling and Servicing Agreement
EXHIBIT C-1
FORM OF CORESTATES COLLECTION ACCOUNT AGREEMENT
September 25, 1996
CoreStates Bank, N.A.
0000 Xxxxxxxx Xxxxxx
P.O. Box 7618
Philadelphia, Pennsylvania 19101-7618
Attention: Xxxxx X. Xxxxx
Corporate Banking
Gentlemen/Ladies:
Reference is made to collection accounts nos. 0000000000 and
0001295314 into which certain monies, instruments and other properties are
deposited from time to time (the "Collection Accounts") maintained with
CoreStates Bank, N.A. ("you" or the "Bank") by X. Xxxxxxxxxx & Co., Inc. (the
"Company"). Pursuant to that certain Collection Account Agreement dated February
9, 1996 (the "February 1996 Collection Agreement") among you, the Company and
Citicorp USA, Inc., as agent (the"Agent") under the Credit Agreement described
in the February 1996 Collection Agreement (for your convenience, a copy of the
executed February 1996 Agreement is attached hereto as Exhibit A), the
Collection Accounts and the other Account Collateral (as hereinafter defined)
were assigned to the Agent. The Company and certain of its affiliates have
entered into a transaction (the "Receivables Transaction") to, among other
things, refinance in part advances made under the Credit Agreement (as defined
in the February 1996 Collection Agreement). Pursuant to the Receivables
Transaction, the Collection Accounts and the other Account Collateral are to be
transferred to Bankers Trust Company, as trustee for Xxxxxxxxxx Trade
Receivables Master Trust, established pursuant to a Pooling and Servicing
Agreement (the "Pooling and Servicing Agreement") dated as of August 23, 1996
among Xxxxxxxxxx Financial Corporation, the Company, as servicer (in such
capacity, the "Servicer"), and Bankers Trust Company, as trustee (the
"Trustee"). By execution of this Collection Account Agreement, the Agent hereby
transfers and assigns all of its right, title and interest in the February 1996
Collection Agreement to the Trustee. It is a condition precedent to the
Receivables Transaction that you execute and deliver this Collection Account
Agreement.
Pursuant to the Receivables Transaction, the Company and certain of
its affiliates have granted to the Trustee a security interest in certain
property of the Company, including, among other things, the following (the
"Account Collateral"): the Lockboxes referred to below, the Collection Accounts,
all funds held therein and all certificates and instruments, if any, from time
to time representing or evidencing such Collection Accounts, all interest,
dividends, cash, instruments and other property from time to time received,
Pooling and Servicing Agreement
C-1-2
receivable or otherwise distributed in respect of or in exchange for any or all
of the then existing Account Collateral and all proceeds of any and all of the
foregoing Account Collateral and, to the extent not otherwise included, all (i)
payments under insurance (whether or not the Trustee is the loss payee thereof),
or any indemnity, warranty or guaranty, payable by reason of loss or damage to
or otherwise with respect to any of the foregoing Account Collateral and (ii)
cash.
The Company hereby grants, to the Trustee, for the benefit of the
Trust, and the other Holders referred to in the Pooling and Servicing Agreement,
a security interest in, and a pledge to, all of its right, title and interest in
and to the Lockboxes referred to below, the Collection Accounts and all Account
Collateral now or hereinafter on deposit in the Lockboxes and/or the Collection
Accounts and agrees that all funds in the Collection Accounts shall be
transferred to the Trustee on behalf of the Trust in accordance with the
instructions set forth herein. It is a condition to the continued maintenance of
the Lockboxes and Collection Accounts with you that you agree to this letter
agreement. The Company further agrees that the Trustee shall have, subject to
the terms of the Lockbox Agreement (as defined in paragraph (b) below), full and
irrevocable right, power and authority to demand, collect, withdraw, receive or
xxx for all amounts now or hereafter on deposit in the Lockboxes and/or
Collection Accounts and at its discretion to take any other action which it
deems necessary or appropriate to protect its interest in the Lockboxes and
Collection Accounts. Except as provided in paragraphs (e) and (i) herein, the
Lockboxes and Collection Accounts shall not be subject to deductions, setoff,
banker's lien or any other right in favor of any person or entity other than the
Trustee, the Trust or the other Holders referred to in the Pooling and Servicing
Agreement.
We hereby direct you to change the name on the Collection Accounts
from "Citicorp USA, Inc., as Agent, Re: X. Xxxxxxxxxx & Co., Inc" to "Bankers
Trust Company, as Trustee, Re: X. Xxxxxxxxxx & Co., Inc.".
By signing this letter agreement you confirm that, as of the date
hereof, you have received no notice of any other pledge or assignment of the
Lockboxes and/or Collection Accounts other than to the Agent pursuant to the
February 1996 Collection Agreement. Further, you hereby agree with the Trustee
as follows:
(a) The Company maintains with the Bank the Collection Account in
the name of "Bankers Trust Company, as Trustee, Re: X. Xxxxxxxxxx & Co.,
Inc." The Company's account debtors make payment directly to the post
office boxes ("Lockboxes") and the addresses used for such boxes are:
X.X. Xxx 0000-X0000
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
X.X. Xxx 0000-X0000
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Pooling and Servicing Agreement
X-0-0
X.X. Xxx 0000-X0000
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
(b) The Bank will have exclusive and unrestricted access to the
Lockboxes and will have complete and exclusive authority to receive, pick
up and open all mail therein addressed to the Company, whether registered,
certified, insured or otherwise. The Company will have no control over the
Lockboxes or any mail received in the Lockboxes. The Bank will open all
mail contained in the Lockboxes and remove and inspect the enclosures and
will deposit in the Collection Accounts all checks, drafts and other
payment orders on which the payee or endorsee is the Company. The Company
agrees that it will not, and the Bank agrees that it will not permit the
Company to, establish new lockbox accounts with the Bank unless such
lockbox accounts are the subject of an agreement with the Trustee on terms
and conditions substantially identical to those contained herein. To the
extent not inconsistent with the terms and provisions of this Letter, the
Lockboxes and the Collection Accounts shall continue to be governed by the
terms of the Wholesale Lockbox Service Product Operating Procedures (as
amended, supplemented or otherwise modified form time to time in
accordance with the immediately succeeding sentence, the "Lockbox
Agreement") in effect between the Company and the Bank, a copy of which is
attached hereto as Exhibit B. The Company agrees not to change or amend
any provision of the Lockbox Agreement without the prior written consent
of the Trustee.
(c) Notwithstanding anything to the contrary in the Lockbox
Agreement or any other agreement relating to the Collection Accounts, the
Collection Accounts will be maintained solely for the benefit of the
Trustee and will be subject to written instructions only from an
authorized officer of the Trustee. The Trustee will provide you with a
listing of such authorized officers, which listing is attached hereto as
Schedule 1 (as such Schedule may be amended from time to time). All of the
Account Collateral shall be in the sole dominion and control of the
Trustee, and the Company shall have no control thereover.
(d) You will follow your usual operating procedures for the handling
of any remittance received in the Lockboxes or the Collection Accounts
that contains restrictive endorsements, irregularities (such as a variance
between the written and numerical amounts), undated or postdated items,
missing signatures, incorrect payees, etc.
(e) You will mail all checks returned unpaid because of uncollected
or insufficient funds under appropriate advice to the Company (with a copy
of the notification of return to the Trustee), and you may charge the
Collection Accounts for the face amount thereof. In the event insufficient
funds remain in the Collection Accounts to cover any returned,
uncollected, reversed or charged back items, the Company shall indemnify
you for the uncollected amounts of any such items upon your demand.
Pooling and Servicing Agreement
C-1-4
(f) You will maintain a record of all checks and other remittance
items received in the Lockboxes and the Collection Accounts and, in
addition to providing the Company with photostats, vouchers, enclosures,
etc. of such checks and remittance items on a daily basis, furnish to the
Trustee a monthly statement of the Lockboxes and Collection Accounts to:
Bankers Trust Company, as Trustee, Xxxx Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, Attention: Corporate Trust and Agency/Structured Finance Group,
with a copy to the Company.
(g) You will transfer, in same day funds, on each of your business
days, all available funds collected from the Collection Accounts on such
day to the following account (the "Concentration Account"):
ABA Number: 000000000
Bankers Trust Company
Xxxx Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Account Name: BTCO f/a/x Xxxxxxxxxx
Cash Collateral Account
Account Number: 00000000
Reference: Xxxxxxxxxx Concentration Account
Attn: Xxxxx Xxxx
or to such other account as the Trustee may from time to time
designate in writing.
(h) Subject to paragraphs (e) and (i) herein, all transfers referred
to in paragraphs (b) and (g) above shall be made by the undersigned
irrespective of, and without deduction for, any counterclaim, defense,
recoupment or set-off and shall be final, and the undersigned will not
seek to recover from the Trustee for any reason any such payment once
made.
(i) All service charges and fees with respect to the Lockboxes or
the Collection Accounts shall, in accordance with the Lockbox Agreement,
be debited to the applicable Collection Account. In the event insufficient
funds remain in such Account to cover such service charges and fees, the
Company shall pay and indemnify you for the amounts of such service
charges and fees.
(j) The Trustee shall be entitled to exercise any and all rights of
the Company in respect of the Lockboxes and the Collection Accounts in
accordance with the terms of the Pooling and Servicing Agreement, and the
undersigned shall, subject to the terms of the Lockbox Agreement, comply
in all respects with such exercise.
(k) Notwithstanding any other provisions of this letter agreement:
Pooling and Servicing Agreement
C-1-5
(1) Unless you are grossly negligent or engage in willful
misconduct in performance or non-performance in connection with this
letter agreement and the Collection Accounts, the Company agrees to
hold you harmless from any claims, damages, losses or expenses
incurred by any party in connection herewith. In the event you
breach the standard of care set forth herein, the Company and the
Trustee expressly agree that your liability shall be limited to
damages directly caused by such breach and in no event shall you be
liable for any incidental, indirect, punitive or consequential
damages whatsoever.
(2) The Company agrees that you may act on the instructions of
the Trustee without making any special inquiry into the authority of
the Trustee, and you will not be held liable for reasonable reliance
on such instructions.
(3) You shall not be liable for any failure, inability to
perform, or delay in performance hereunder if such failure,
inability or delay is due to acts of God, war, civil commotion,
governmental action, fire, explosion, strikes, other industrial
disturbance, equipment malfunction, action, non-action or delayed
action on the part of either the Company or the Trustee or any other
entity or any other causes that are beyond your reasonable control.
(4) The Company's responsibility under paragraphs (e), (i) and
(k) shall survive the termination of this letter agreement.
The letter agreement shall be binding upon and shall inure to the
benefit of you, the Company, the Agent, the Trustee, the Program Agent, the
Holders and their respective successors, transferees and assigns. You may
terminate this letter agreement only upon thirty days' prior written notice to
the Company and the Trustee. The Trustee may terminate this letter agreement
upon ten days' prior written notice to you and the Company. Upon such
termination you shall close the Lockboxes and the Collection Accounts and
transfer all funds in the Lockboxes and the Collection Accounts to the
Concentration Account. After any such termination, you shall nonetheless remain
obligated promptly to transfer to the Concentration Account or to the Trustee
all funds and other property received in respect of the Lockboxes or any
Collection Account.
Pooling and Servicing Agreement
C-1-6
This letter agreement may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which when taken together
shall constitute one and the same instrument. Delivery of an executed
counterpart of a signature page to this letter Agreement by telecopier shall be
effective as delivery of a manually executed counterpart of this letter
agreement.
This letter agreement supersedes all prior agreements, oral or
written, with respect to the subject matter hereof and may not be amended,
modified or supplemented except by a writing signed by the Trustee, the Company
and you.
Upon acceptance of this letter agreement it will be the valid and
binding obligation of the Company, the Agent, the Trustee and you, in accordance
with its terms.
THIS LETTER AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAW OF THE STATE OF NEW YORK.
Very truly yours,
X. XXXXXXXXXX & CO., INC.
By: __________________________________
Name:
Title:
CITICORP USA, INC., as Agent
By: __________________________________
Name:
Title:
Pooling and Servicing Agreement
C-1-7
BANKERS TRUST COMPANY, not in its
individual capacity but solely as Trustee
By: __________________________________
Name:
Title:
Acknowledged and agreed to as of
the date first above written:
CORESTATES BANK, N.A.
By: ___________________________
Name:
Title:
Pooling and Servicing Agreement
Schedule 1
LIST OF AUTHORIZED OFFICERS
Xxxxx Xxxx
Xxxxxxx Xxxx-Xxxxxxx
Xxxxx Xxxxxxx
Xxxx Xxxxx
Xxxxx Xxxxxx
Xxxx XxXxxxx
Pooling and Servicing Agreement
EXHIBIT X-0
XXXX XX XXXX XXXX, XXXXXXXXX AND MALAYSIA
COLLECTION ACCOUNT AGREEMENT
September 25, 1996
Citibank, N.A.
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxx Xxxxxx
Gentlemen/Ladies:
Reference is made to the U.S. Dollar collection account no.
_________ and the local currency account no. ________, into which certain
monies, instruments and other properties are deposited from time to time (the
"Collection Accounts") maintained with Citibank, N.A. ("you" or the "Bank") by
Pegasus Polymers Asia Limited ("Pegasus Asia"). Pursuant to (a) that certain
Receivables Purchase Agreement dated February 9, 1996 (the "February 1996
Receivables Purchase Agreement") among Pegasus Asia and Xxxxxxxxxx International
Limited (the "Company"), Pegasus Asia agreed to transfer to the Company, and the
Company agreed to acquire from Pegasus Asia, all of Pegasus Asia's right, title
and interest in and to the monies, instruments and other properties deposited
from time to time in the Collection Accounts for the term thereof and (b) that
certain Debenture in Relation to Revolving Credit of Up to U.S. $125,000,000
dated February 9, 1996 (the "February 1996 Debenture") executed by the Company
in favor of Citicorp USA, Inc., as agent (the"Agent") under the Credit Agreement
described in the February 1996 Debenture (for your convenience, copies of the
executed February 1996 Receivables Purchase Agreement and the executed February
1996 Debenture are attached hereto as Exhibit A and Exhibit B, respectively),
the Collection Accounts and the other Account Collateral (as hereinafter
defined) were assigned to the Agent. The Company and certain of its affiliates
have entered into a transaction (the "Receivables Transaction") to, among other
things, refinance in part advances made under the Credit Agreement described in
the February 1996 Debenture. Pursuant to the Receivables Transaction, the
Collection Accounts and the other Account Collateral are to be transferred to
Bankers Trust Company, as trustee for Xxxxxxxxxx Trade Receivables Master Trust,
established pursuant to a Pooling and Servicing Agreement (the "Pooling and
Servicing Agreement") dated as of August 23, 1996 among Xxxxxxxxxx Financial
Corporation, X. Xxxxxxxxxx & Co., Inc., as servicer (in such capacity, the
"Servicer"), and Bankers Trust Company, as trustee (the "Trustee"). By execution
of this Collection Account Agreement, the Agent hereby transfers and assigns all
of its right, title and interest in the Collection Accounts to the Trustee. It
is a condition precedent to the Receivables Transaction that you execute and
deliver this Collection Account Agreement.
Pooling and Servicing Agreement
C-2-2
Pursuant to the Receivables Transaction, the Company and certain of
its affiliates have granted to the Trustee a security interest in certain
property of the Company, including, among other things, the following (the
"Account Collateral"): the Collection Accounts, all funds held therein and all
certificates and instruments, if any, from time to time representing or
evidencing such Collection Accounts, all interest, dividends, cash, instruments
and other property from time to time received, receivable or otherwise
distributed in respect of or in exchange for any or all of the then existing
Account Collateral and all proceeds of any and all of the foregoing Account
Collateral and, to the extent not otherwise included, all (i) payments under
insurance (whether or not the Trustee is the loss payee thereof), or any
indemnity, warranty or guaranty, payable by reason of loss or damage to or
otherwise with respect to any of the foregoing Account Collateral and (ii) cash.
The Company hereby grants, to the Trustee, for the benefit of the
Trust, and the other Holders referred to in the Pooling and Servicing Agreement,
a security interest in, and a pledge to, all of its right, title and interest in
and to the Collection Accounts and all Account Collateral now or hereinafter on
deposit in the Collection Accounts and agrees that all funds in the Collection
Accounts shall be transferred to the Trustee on behalf of the Trust in
accordance with the instructions set forth herein. It is a condition to the
continued maintenance of the Collection Accounts with you that you agree to this
letter agreement. The Company further agrees that the Trustee shall have full
and irrevocable right, power and authority to demand, collect, withdraw, receive
or xxx for all amounts now or hereafter on deposit in the Collection Accounts
and at its discretion to take any other action which it deems necessary or
appropriate to protect its interest in the Collection Accounts. Except as
provided in paragraphs (d) and (h) herein, the Collection Accounts shall not be
subject to deductions, setoff, banker's lien or any other right in favor of any
person or entity other than the Trustee, the Trust or the other Holders referred
to in the Pooling and Servicing Agreement.
We hereby direct you to change the name on the Collection Accounts
from "F/A/X Xxxxxxxxxx Int'l Inc." to "Bankers Trust Company, as Trustee, Re:
Pegasus Polymers Asia Ltd.".
By signing this letter agreement you confirm that, as of the date
hereof, you have received no notice of any other pledge or assignment of the
Collection Accounts other than to the Agent pursuant to the February 1996
Debenture. Further, you hereby agree with the Trustee as follows:
(a) The Company maintains with the Bank the Collection Accounts in
the name of "Bankers Trust Company, as Trustee, Re: Pegasus Polymers Asia
Ltd."
(b) Notwithstanding anything to the contrary in any agreement
relating to the Collection Accounts, the Collection Accounts will be
maintained solely for the benefit of the Trustee and will be subject to
written instructions only from an authorized officer of the Trustee. The
Trustee will provide you with a listing of such authorized officers, which
listing is attached hereto as Schedule 1 (as such schedule may be amended
from time to time). All of the Account Collateral shall be in the sole
Pooling and Servicing Agreement
C-2-3
dominion and control of the Trustee, and the Company shall have no control
thereover.
(c) You will follow your usual operating procedures for the handling
of any remittance received in the Collection Accounts that contains
restrictive endorsements, irregularities (such as a variance between the
written and numerical amounts), undated or postdated items, missing
signatures, incorrect payees, etc.
(d) You will mail all checks returned unpaid because of uncollected
or insufficient funds under appropriate advice to the Company (with a copy
of the notification of return to the Trustee), and you may charge the
Collection Accounts for the face amount thereof. In the event insufficient
funds remain in the Collection Accounts to cover any returned,
uncollected, reversed or charged back items, the Company shall indemnify
you for the uncollected amounts of any such items upon your demand.
(e) You will maintain a record of all checks and other remittance
items received in the Collection Accounts and, in addition to providing
the Company with photostats, vouchers, enclosures, etc. of such checks and
remittance items on a daily basis, furnish to the Trustee a monthly
statement of the Collection Accounts to: Bankers Trust Company, as Trustee
for Xxxxxxxxxx Trade Receivables Master Trust, Four Albany Street, 10th
floor, New York, New York 10006, Attention: Corporate Trust and
Agency/Structured Finance Group, with a copy to the Company.
(f) You will transfer, in same day funds, on each of your business
days, all available funds collected from the Collection Accounts on such
day to the following account (the "Concentration Account"):
ABA Number: 000000000
Bankers Trust Company
Xxxx Xxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Account Name: BTCO f/a/x Xxxxxxxxxx
Cash Collateral Account
Account Number: 00000000
Reference: Xxxxxxxxxx Concentration Account
Attn: Xxxxx Xxxx
or to such other account as the Trustee may from time to time
designate in writing.
(g) Subject to paragraphs (d) and (h) herein, all transfers referred
to in paragraph (f) above shall be made by the undersigned irrespective
of, and without deduction for, any counterclaim, defense, recoupment or
set-off and shall be final, and the undersigned will not seek to recover
from the Trustee for any reason any such
Pooling and Servicing Agreement
C-2-4
payment once made.
(h) All service charges and fees with respect to the Collection
Accounts shall be debited to the applicable Collection Account. In the
event insufficient funds remain in such Account to cover such service
charges and fees, the Company shall pay and indemnify you for the amounts
of such service charges and fees.
(i) The Trustee shall be entitled to exercise any and all rights of
the Company in respect of the Collection Accounts in accordance with the
terms of the Pooling and Servicing Agreement, and the undersigned shall
comply in all respects with such exercise.
(j) Notwithstanding any other provisions of this letter agreement:
(1) Unless you are grossly negligent or engage in willful
misconduct in performance or non-performance in connection with this
letter agreement and the Collection Accounts, the Company agrees to
hold you harmless from any claims, damages, losses or expenses
incurred by any party in connection herewith. In the event you
breach the standard of care set forth herein, the Company and the
Trustee expressly agree that your liability shall be limited to
damages directly caused by such breach and in no event shall you be
liable for any incidental, indirect, punitive or consequential
damages whatsoever.
(2) The Company agrees that you may act on the instructions of
the Trustee without making any special inquiry into the authority of
the Trustee, and you will not be held liable for reasonable reliance
on such instructions.
(3) You shall not be liable for any failure, inability to
perform, or delay in performance hereunder if such failure,
inability or delay is due to acts of God, war, civil commotion,
governmental action, fire, explosion, strikes, other industrial
disturbance, equipment malfunction, action, non-action or delayed
action on the part of either the Company or the Trustee or any other
entity or any other causes that are beyond your reasonable control.
(4) The Company's responsibility under paragraphs (d), (h) and
(j) shall survive the termination of this letter agreement.
This letter agreement shall be binding upon and shall inure to the
benefit of you, the Company, the Agent, the Trustee, the Program Agent, the
Holders and their respective successors, transferees and assigns. You may
terminate this letter agreement only upon thirty days' prior written notice to
the Company and the Trustee. The Trustee may terminate this letter agreement
upon ten days' prior written notice to you and the Company. Upon such
termination you shall close the Collection Accounts and transfer all funds in
the Collection Accounts to the Concentration Account. After any such
termination, you shall nonetheless remain obligated promptly to transfer to the
Concentration Account or to the Trustee all funds
Pooling and Servicing Agreement
C-2-5
and other property received in respect of any Collection Account.
This letter agreement may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed shall be deemed to be an original and all of which when taken together
shall constitute one and the same instrument. Delivery of an executed
counterpart of a signature page to this letter Agreement by telecopier shall be
effective as delivery of a manually executed counterpart of this letter
agreement.
This letter agreement supersedes all prior agreements, oral or
written, with respect to the subject matter hereof and may not be amended,
modified or supplemented except by a writing signed by the Trustee, Pegasus
Asia, the Company, the Agent, and you.
Upon acceptance of this letter agreement it will be the valid and
binding obligation of the Trustee, Pegasus Asia, the Company, the Agent, and
you, in accordance with its terms.
Pooling and Servicing Agreement
C-2-6
THIS LETTER AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAW OF THE STATE OF NEW YORK.
Very truly yours,
PEGASUS POLYMERS ASIA LIMITED
By: __________________________________
Name:
Title:
XXXXXXXXXX INTERNATIONAL, LTD.
By: __________________________________
Name:
Title:
CITICORP USA, INC., as Agent
By: __________________________________
Name:
Title:
Pooling and Servicing Agreement
C-2-7
BANKERS TRUST COMPANY, not in its
individual capacity but solely as Trustee
By: __________________________________
Name:
Title:
Acknowledged and agreed to as of
the date first above written:
CITIBANK, N.A.
By: _______________________________
Name:
Title:
Pooling and Servicing Agreement
Schedule 1
LIST OF AUTHORIZED OFFICERS
Xxxxx Xxxx
Xxxxxxx Xxxx-Xxxxxxx
Xxxxx Xxxxxxx
Xxxx Xxxxx
Xxxxx Xxxxxx
Xxxx XxXxxxx
Pooling and Servicing Agreement
EXHIBIT D
FORM OF RULE 144A LETTER
[Date]
[Trustee]
Xxxxxxxxxx Financial Corporation
Re: Xxxxxxxxxx Trade Receivables Master Trust,
[ ]% Receivables Backed Certificates,
Series [ ]
Ladies and Gentlemen:
In connection with our acquisition of the Certificates referred to
above, we certify that (a) we understand that the Certificates are not being
registered under the Securities Act of 1933, as amended (the "Securities Act"),
or any state securities laws and are being transferred to us in a transaction
that is exempt from the registration requirements of the Act and any such laws,
(b) we have such knowledge and experience in financial and business matters that
we are capable of evaluating the merits and risks of investment in the
Certificates, (c) we have had the opportunity to ask questions of and receive
answers from [___________] concerning the purchase of the Certificates and all
matters relating thereto or any additional information deemed necessary to our
decision to purchase the Certificates, (d) we are not a "benefit plan investor"
as defined in Section 2510.3-101(f)(2) of the Labor Regulations promulgated
under the Employee Retirement Income Security Act of 1974, as amended,] (e) we
have not, nor has anyone acting on our behalf, offered, transferred, pledged,
sold or otherwise disposed of the Certificates, any interest in the Certificates
or any other similar security to, or solicited any offer to buy or accept a
transfer, pledge or other disposition of the Certificates, any interest in the
Certificates or any other similar security from, or otherwise approached or
negotiated with respect to the Certificates, any interest in the Certificates or
any other similar security with, any person in any manner, or made any general
solicitation by means of general advertising or in any other manner, or taken
any other action, that would constitute a distribution of the Certificates under
the Securities Act or that would render the disposition of the Certificates a
violation of Section 5 of the Securities Act or require registration pursuant
thereto, nor will it act, nor has it authorized or will it authorize any person
to act, in such manner with respect to the Certificates, and (f) we are a
"qualified institutional buyer" as that term is defined in Rule 144A under the
Securities Act and have
Pooling and Servicing Agreement
D-2
completed either of the forms of certification to that effect attached hereto as
Annex 1 or Annex 2. We are aware that the sale to us is being made in reliance
on Rule 144A. We are acquiring the Certificates for our own account or for
resale pursuant to Rule 144A, and we understand that the Certificates may be
resold, pledged or transferred only (i) to a person reasonably believed to be a
qualified institutional buyer that purchases for its own account or for the
account of a qualified institutional buyer to whom notice is given that the
resale, pledge or transfer is being made in reliance on Rule 144A or (ii)
pursuant to another exemption from registration under the Securities Act.
Very truly yours,
[NAME OF INSTITUTION]
By: _______________________________
Name:
Title:
Pooling and Servicing Agreement
FORM OF NON-RULE 144A LETTER
[Date]
[Trustee]
Xxxxxxxxxx Financial Corporation
Re: Xxxxxxxxxx Trade Receivables Master Trust,
[ ]% Receivables Backed Certificates
Series [ ]
Ladies and Gentleman:
In connection with our acquisition of the Certificates referred to
above, we certify that (a) we understand that the Certificates are not being
registered under the Securities Act of 1933, as amended (the "Act") , or any
state securities laws, and are being transferred to us in a transaction that is
exempt from the registration requirements of the Act and any such laws, (b) we
are an "accredited investor," as defined in Regulation D under the Act, and have
such knowledge and experience in financial and business matters that we are
capable of evaluating the merits and risks of investment in the Certificates,
(c) we have had the opportunity to ask questions of and receive answers from
[_______________] concerning the purchase of the Certificates and all matters
relating thereto or any additional information deemed necessary to our decision
to purchase the Certificates, (d) we are not a "benefit plan investor" as
defined in Section 2510.3-101(f)(2) of the Labor Regulations promulgated under
the Employee Retirement Income Security Act of 1974, as amended, (e) we are
acquiring the Certificates for investment for our own account and not with a
view to any distribution of such Certificates (but without prejudice to our
right at all times to sell or otherwise dispose of the Certificates in
accordance with clause (g) below), (f) we have not, nor has anyone acting on our
behalf, offered, transferred, pledged, sold or otherwise disposed of the
Certificates, any interest in the Certificates or any other similar security to,
or solicited any offer to buy or accept a transfer, pledge or other disposition
of the Certificates, any interest in the Certificates or any other similar
security from, or otherwise approached or negotiated with respect to the
Certificates, any interest in the Certificates or any other similar security
with, any person in any manner, or made any general solicitation by means of
general advertising or in any other manner, or taken any other action, that
would constitute a distribution of the Certificates under the Securities Act or
that would render the disposition of the Certificates a violation of Section 5
of the Securities Act or require registration pursuant thereto, nor will it act,
nor has it authorized or will it authorize any person to act, in such manner
with respect to the Certificates, and (g) we will not sell, transfer or
otherwise dispose of any Certificates unless
Pooling and Servicing Agreement
D-2
(1) such sale, transfer or other disposition is made pursuant to an effective
registration statement under the Act or is exempt from such registration
requirements, (2) the purchaser or transferee of such Certificate has executed
and delivered to you a certificate to substantially the same effect as this
certificate, and (3) the purchaser or transferee has otherwise complied with any
conditions for transfer set forth in the Pooling and Servicing Agreement.
Very truly yours,
[NAME]
By: _________________________________
Name:
Title:
Pooling and Servicing Agreement
EXHIBIT E
FORM OF DAILY REPORT
[TO BE PROVIDED]
Pooling and Servicing Agreement
EXHIBIT F
Xxxxxxxxxx Credit Policy Manual
[TO BE PROVIDED]
Pooling and Servicing Agreement
EXHIBIT G
FORM OF SEMI-ANNUAL SERVICING REPORT OF
INDEPENDENT PUBLIC ACCOUNTANTS
To Xxxxxxxxxx Financial Corporation, the Trustee, the Rating Agencies and the
Certificateholders:
At your request, we have performed the procedures enumerated below
with respect to the receivables of Xxxxxxxxxx Financial Corporation (the
"Company") that are serviced by X.Xxxxxxxxxx & Co., Inc. (the "Servicer") for
the period from __________, 199_ to __________, 199_ as set forth in the
accompanying Determination Date Statements (the "Statements") and in the five
accompanying Daily Reports (which were selected on a random basis from the
above-referenced period) (the "Daily Reports"). These procedures, which were
specified by you, were performed solely to assist you, and this report is solely
for your information and should not be used by those who did not participate in
determining the procedures. The procedures and findings are as follows:
A. We obtained all Statements for the period from __________,
199_ through __________, 199_ (the "Fiscal Period") and
performed the following:
- We recalculated the mathematical accuracy of the
Statements.
- With respect to Receivables, we agreed the amounts
appearing as principal amounts and the related aging
buckets to either schedules prepared by the Servicer or
reports generated by the Servicer's system.
B. For a selection of three Statements (one of which was the
Statement for the last Collection Period of the Fiscal
Period), we performed the following procedures:
With respect to the amount appearing as Collections on such
Statements:
- Obtained a daily listing of collections for the
Collection Period and agreed the total on the Statements
to a cumulative total of the daily listing of
collections for that period.
- Agreed a random sample of at least ten of the daily
collections appearing on the daily listing of
collections to the bank statements of the Xxxxxxxxxx
Receivables Master Trust (the "Trust").
- Agreed the aggregate amount of Receivables received
during that Collection Period to the Servicer's
system-generated reports.
Pooling and Servicing Agreement
G-2
- For each Obligor the amount of whose Receivables is
greater than 3% of the aggregate amount of all
Receivables, agreed the aggregate amount of all
Receivables with respect to such Obligor to the
Servicer's system-generated reports.
With respect to the amount appearing as Defaulted Receivables:
- Agreed the total Defaulted Receivables to the Servicer's
system-generated reports.
- From a random sample of at least 10 Defaulted
Receivables during the month, agreed the default amount
to the Obligor's file in the Servicer's system.
With respect to the amount appearing as Diluted Receivables:
- Agreed the total Diluted Receivables to the Servicer's
system generated reports.
- From a random sample of at least 10 Diluted Receivables
during the month, agreed the default amount to the
Obligor's file in the Service system.
With respect to the amount appearing as Eligible Receivables:
- Recalculated the mathematical accuracy of the Company's
schedule of Eligible Receivables.
- Agreed the amounts appearing in this schedule to a
statement generated by the Servicer's system.
C. With respect to each of the Daily Reports, we agreed amounts
to the system-generated reports provided by each Originator
for such day.
Because the above procedures do not constitute an audit conducted in accordance
with generally accepted auditing standards, we do not express an opinion on the
Statements for the period from __________, 199_ to __________, 199_. This report
relates only to the accounts and items specified above and does not extend to
any financial statements of the Servicer or the Company, taken as a whole.
Pooling and Servicing Agreement
