Exhibit 10.39
NORDSTROM fsb,
as Seller,
and
NORDSTROM CREDIT CARD RECEIVABLES LLC,
as Purchaser
RECEIVABLES PURCHASE AGREEMENT
Dated as of April 1, 2002
TABLE OF CONTENTS
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ARTICLE ONE
DEFINITIONS
Section 1.01.Definitions.................................................................................... 2
Section 1.02.Other Definitional Provisions.................................................................. 6
ARTICLE TWO
PURCHASE AND CONVEYANCE OF RECEIVABLES
Section 2.01.Purchase....................................................................................... 7
Section 2.02.Additional Accounts............................................................................ 8
Section 0.00.Xxxxxxxx of Documents.......................................................................... 9
Section 2.04.Representations and Warranties as to the Security Interest of the Purchaser in the Receivables. 10
ARTICLE THREE
CONSIDERATION AND PAYMENT
Section 3.01.Purchase Price................................................................................. 11
Section 3.02.Adjustments to Purchase Price.................................................................. 11
Section 0.00.Xxxxxxx Contribution........................................................................... 11
ARTICLE FOUR
REPRESENTATIONS AND WARRANTIES
Section 4.01.Representations and Warranties of the Seller................................................... 12
Section 4.02.Representations and Warranties as to the Agreement and the Receivables......................... 13
Section 4.03.Representations and Warranties of the Purchaser................................................ 15
ARTICLE FIVE
COVENANTS
Section 5.01.Covenants of the Seller........................................................................ 17
Section 5.02.Covenants of the Seller with Respect to Receivables Purchase Agreements........................ 18
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ARTICLE SIX
REPURCHASE OBLIGATION
Section 6.01.Reassignment of Ineligible Receivables......................................................... 20
Section 6.02.Reassignment................................................................................... 20
ARTICLE SEVEN
CONDITIONS PRECEDENT
Section 7.01.Conditions to the Purchaser's Obligations Regarding Initial Receivables........................ 22
Section 7.02.Conditions Precedent to the Seller's Obligations............................................... 22
ARTICLE EIGHT
TERM AND PURCHASE TERMINATION
Section 8.01.Term........................................................................................... 24
Section 8.02.Purchase Termination........................................................................... 24
ARTICLE NINE
MISCELLANEOUS PROVISIONS
Section 9.01.Amendment...................................................................................... 25
Section 9.02.Governing Law.................................................................................. 25
Section 9.03.Notices........................................................................................ 25
Section 9.04.Severability of Provisions..................................................................... 25
Section 9.05.Merger, Consolidation of, or Assignment of Obligations of Seller............................... 26
Section 9.06.Acknowledgement and Agreement of the Seller.................................................... 27
Section 9.07.Further Assurances............................................................................. 27
Section 0.00.Xx Waiver; Cumulative Remedies................................................................. 27
Section 9.09.Counterparts................................................................................... 27
Section 9.10.Third-Party Beneficiaries...................................................................... 28
Section 9.11.Merger and Integration......................................................................... 28
Section 9.12.Effect of Headings and Table of Contents....................................................... 28
Section 9.13.Schedules and Exhibits......................................................................... 28
Section 9.14.Survival of Representations and Warranties..................................................... 28
Section 9.15.Nonpetition Covenant........................................................................... 28
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EXHIBITS
Exhibit A - Form of Supplemental Conveyance.................................... A-1
SCHEDULES
Schedule I - List of Accounts................................................... S-1
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RECEIVABLES PURCHASE AGREEMENT
This Receivables Purchase Agreement, dated as of April 1, 2002, is
between Nordstrom fsb (the "Bank"), a federal savings bank (the "Seller"), and
Nordstrom Credit Card Receivables LLC, a Delaware limited liability company (the
"Purchaser").
WHEREAS, in the regular course of its business, the Seller has
originated, and in the future may originate or acquire, certain credit card
accounts and the related receivables;
WHEREAS, the Purchaser desires to purchase, from time to time, certain
Receivables; and
WHEREAS, the Seller desires to sell and assign, from time to time, the
Receivables to the Purchaser upon the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in consideration of the mutual terms and covenants
contained herein and other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:
ARTICLE ONE
DEFINITIONS
Section 1.01. Definitions. Whenever used in this Agreement, the
following words and phrases shall have the following meanings:
"Account" has the meaning set forth in the Transfer and Servicing
Agreement.
"Account Owner" has the meaning set forth in the Transfer and Servicing
Agreement.
"Addition Cut-Off Date" has the meaning set forth in the Transfer and
Servicing Agreement.
"Addition Date" has the meaning set forth in the Transfer and Servicing
Agreement.
"Addition Notice Date" has the meaning specified in Section 2.02(a).
"Additional Account" has the meaning set forth in the Transfer and
Servicing Agreement.
"Adverse Effect" has the meaning set forth in the Transfer and
Servicing Agreement.
"Agreement" means this Receivables Purchase Agreement, as amended or
supplemented from time to time.
"Bank" means Nordstrom fsb, a federal savings bank, and its successors.
"Bankruptcy Code" means Title 11 of the United States Code, as amended.
"Closing Date" means May 1, 2002.
"Collection Account" has the meaning set forth in the Indenture.
"Collections" has the meaning set forth in the Transfer and Servicing
Agreement.
"Conveyance" has the meaning specified in Section 2.01(a).
"Conveyance Papers" has the meaning specified in Section 4.01(a)(iii).
"Credit Adjustment" means, with respect to one or more Receivables
previously conveyed by the Seller to the Purchaser, an amount equal to the
aggregate of (i) the reduction in the principal balance of the related
Receivables described in Section 3.02 multiplied by the quotient (expressed as a
percentage) of (ii) the Purchase Price for Principal Receivables payable on the
related Distribution Date divided by the aggregate of the Principal Receivables
transferred to the Purchaser on such Addition Date.
"Credit Card Agreement" has the meaning set forth in the Transfer and
Servicing Agreement.
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"Credit Card Guidelines" has the meaning set forth in the Transfer and
Servicing Agreement.
"Date of Processing" has the meaning set forth in the Transfer and
Servicing Agreement.
"Debtor Relief Laws" means (i) the Bankruptcy Code and (ii) all other
applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement,
receivership, insolvency, reorganization, suspension of payments, readjustment
of debt, marshalling of assets or similar debtor relief laws of the United
States, any state or any foreign country from time to time in effect affecting
the rights of creditors generally.
"Determination Date" has the meaning set forth in the related Indenture
Supplement.
"Distribution Date" has the meaning set forth in the related Indenture
Supplement.
"Document Delivery Date" has the meaning set forth in Section 2.03.
"Eligible Account" has the meaning set forth in the Transfer and
Servicing Agreement, except that the word "Seller" shall be substituted for each
occurrence of the word "Transferor", the word "Purchaser" shall be substituted
for each occurrence of the word "Trust" and all references to the Notes shall be
ignored.
"Eligible Receivable" has the meaning set forth in the Transfer and
Servicing Agreement, except that the word "Seller" shall be substituted for each
occurrence of the word "Transferor", the word "Purchaser" shall be substituted
for each occurrence of the word "Trust" and all references to the Notes shall be
ignored.
"Event of Default" has the meaning set forth in the Indenture.
"Finance Charge Receivables" has the meaning set forth in the Transfer
and Servicing Agreement.
"Governmental Authority" has the meaning set forth in the Transfer and
Servicing Agreement.
"Indenture" means the Master Indenture, as supplemented by the related
Indenture Supplement, as the same may be amended, supplemented or modified from
time to time.
"Indenture Supplement" means the indenture supplement pursuant to which
a Series is issued.
"Indenture Trustee" means Xxxxx Fargo Bank Minnesota, National
Association, as trustee under the Indenture, and its successors.
"Ineligible Receivables" has the meaning set forth in the Transfer and
Servicing Agreement.
"Initial Account" has the meaning set forth in the Transfer and
Servicing Agreement.
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"Initial Cut-Off Date" means the close of business on February 28,
2002.
"Insolvency Event" has the meaning set forth in the Transfer and
Servicing Agreement.
"Interchange" has the meaning set forth in the Transfer and Servicing
Agreement.
"Lien" has the meaning set forth in the Transfer and Servicing
Agreement.
"Master Indenture" means the master indenture, dated as of April 1,
2002, between the Trust, as Issuer, and the Indenture Trustee, as acknowledged
and agreed by the Transferor and the Servicer, as the same may be amended,
supplemented or otherwise modified from time to time.
"Monthly Period" has the meaning set forth in the related Indenture
Supplement.
"Noteholder" has the meaning set forth in the Transfer and Servicing
Agreement.
"Obligor" has the meaning set forth in the Transfer and Servicing
Agreement.
"Offered Notes" has the meaning set forth in the related Indenture.
"Owner Trustee" means Wilmington Trust Company, as trustee under the
Trust Agreement, and its successors.
"Pay Out Event" has the meaning set forth in the related Indenture.
"Periodic Rate Finance Charges" has the meaning set forth in the Credit
Card Agreement applicable to each Account for finance charges (due to periodic
rate) or any similar term.
"Principal Receivables" has the meaning set forth in the Transfer and
Servicing Agreement.
"Purchase Price" means, with respect to (i) Receivables transferred to
the Purchaser on the Closing Date, an amount equal $254,490,213, which amount
includes $199,388,450 from the net cash proceeds from the private placement by
the Purchaser of the Offered Notes and $55,101,763 from the capital contribution
from the Seller to the Purchaser made pursuant to Section 3.03, and (ii)
Receivables transferred to the Purchaser after the Closing Date, an amount equal
to 100% of the aggregate balance of Principal Receivables in the related
Accounts as of the Addition Cut-Off Date or an amount determined to be the fair
market value of such Receivables and the related Purchased Assets.
"Purchased Assets" has the meaning set forth in Section 2.01.
"Purchaser" means Nordstrom Credit Card Receivables LLC, in its
capacity as purchaser of the Receivables under this Agreement, and its
successors.
"Rating Agency" has the meaning set forth in the related Indenture.
"Rating Agency Condition" has the meaning set forth in the related
Indenture.
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"Receivables" means all amounts shown on the Bank's records as amounts
payable by Obligors on any Account from time to time including amounts payable
for Principal Receivables and Finance Charge Receivables.
"Receivables Purchase Agreement" means (i) this Agreement or (ii) any
receivables purchase agreement entered into between the Transferor and an
Account Owner, as the same may be amended, supplemented or otherwise modified
from time to time.
"Removed Accounts" has the meaning set forth in the Transfer and
Servicing Agreement.
"Requirements of Law" has the meaning set forth in the Transfer and
Servicing Agreement.
"Securities" means any one of the Notes (as such term is defined in the
Indenture) or the Certificates (as such term is defined in the Trust Agreement).
"Seller" means Nordstrom fsb, in its capacity as seller of the
Receivables under this Agreement, and its successors.
"Series" has the meaning set forth in the Indenture.
"Servicer" means Nordstrom fsb, in its capacity as servicer under the
Transfer and Servicing Agreement, and its successors.
"Supplemental Accounts" has the meaning set forth the Transfer and
Servicing Agreement.
"Supplemental Conveyance" has the meaning set forth in Section 2.03.
"Tax Opinion" has the meaning set forth in the Indenture.
"Transfer Date" has the meaning set forth in the Indenture.
"Transfer and Servicing Agreement" means the transfer and servicing
agreement, dated as of April 1, 2002, among the Bank, the Purchaser and the
Trust, as amended or supplemented from time to time.
"Transferor" means Nordstrom Credit Card Receivables LLC, in its
capacity as Transferor under the Transfer and Servicing Agreement, and its
successors.
"Trust" means the Nordstrom Credit Card Master Note Trust.
"Trust Agreement" means the trust agreement, dated as of April 1, 2002,
between the Purchaser, as Transferor, and the Owner Trustee, as amended or
supplemented from time to time.
"UCC" means the Uniform Commercial Code, as amended from time to time,
as in effect in the applicable jurisdiction.
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Section 1.02. Other Definitional Provisions.
(a) Except as otherwise specified herein or as the context may
otherwise require, for all purposes of this Agreement, capitalized terms used
herein that are not otherwise defined shall have the meanings ascribed thereto
in the Transfer and Servicing Agreement, the Trust Agreement or the Indenture,
as the case may be.
(b) For all purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, (i) terms used herein
include, as appropriate, all genders and the plural as well as the singular,
(ii) references to this Agreement include all Exhibits hereto, (iii) references
to words such as "herein", "hereof" and the like shall refer to this Agreement
as a whole and not to any particular part, Article or Section within this
Agreement, (iv) references to an Article or Section such as "Article One" or
"Section 1.01" and the like shall refer to the applicable Article or Section of
this Agreement, (v) the term "include" and all variations thereof shall mean
"include without limitation", (vi) the term "or" shall include "and/or" and
(vii) the term "proceeds" shall have the meaning ascribed to such term in the
UCC.
(c) All determinations of the principal or finance charge balance of
Receivables, and of any collections thereof, shall be made in accordance with
the Transfer and Servicing Agreement and the Indenture.
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ARTICLE TWO
PURCHASE AND CONVEYANCE OF RECEIVABLES
Section 2.01. Purchase.
(a) The Seller hereby sells, transfers, assigns, sets over and
otherwise conveys to the Purchaser (collectively, the "Conveyance"), without
recourse except as provided herein, all its right, title and interest in, to and
under (i) the Receivables existing at the close of business on the Initial
Cut-Off Date, in the case of Receivables arising in the Initial Accounts, and on
each Addition Cut-Off Date, in the case of Receivables arising in the Additional
Accounts, and in each case thereafter created from time to time until the
termination of this Agreement pursuant to Article Eight, (ii) Collections and
all Interchange and Recoveries allocable to the Purchaser as provided herein and
all monies due or to become due and all amounts received or receivable with
respect thereto (including proceeds of the reassignment of the Receivables to
the Seller pursuant to Sections 6.01(b) and 6.02), (iii) the rights of the
Seller in the Receivables Purchase Agreements, (iv) all Insurance Proceeds
relating to the Receivables, (v) all money, accounts, general intangibles,
chattel paper, instruments, documents, goods, investment property, deposit
accounts, certificates of deposit, letters of credit and advices of credit
consisting of, arising from, or related to the foregoing, (vi) all present and
future claims, demands, causes and choses in action in respect of any or all of
the foregoing and (vii) any and all proceeds of the foregoing (collectively, the
"Purchased Assets").
(b) In connection with such Conveyance, the Seller agrees (i) to record
and file, at its own expense, any financing statements (and continuation
statements with respect to such financing statements when applicable) with
respect to the Receivables existing as of the Initial Cut-Off Date and
thereafter created in the Initial Accounts, and existing as of the Addition
Cut-Off Date and thereafter created in the Additional Accounts, meeting the
requirements of applicable state law in such manner and in such jurisdictions as
are necessary to perfect the first priority nature of the Purchaser's interest
in the Receivables and other Purchased Assets, and maintain perfection of, the
Conveyance of such Receivables and other Purchased Assets from the Seller to the
Purchaser, (ii) that such financing statements shall name the Seller, as seller,
and the Purchaser, as purchaser, of the Receivables and other Purchased Assets
and (iii) to deliver a file-stamped copy of such financing statements or other
evidence of such filings to the Purchaser as soon as is practicable after
filing.
(c) In connection with such Conveyance, the Seller further agrees that
it will, at its own expense, (i) on or prior to (A) the Closing Date, in the
case of Initial Accounts, (B) the applicable Addition Date, in the case of
Additional Accounts, and (C) the applicable Removal Date, in the case of Removed
Accounts, indicate in its computer files that, in the case of the Initial
Accounts or the Additional Accounts, Receivables created in connection with such
Accounts have been conveyed to the Purchaser in accordance with this Agreement
and have been conveyed by the Purchaser to the Trust pursuant to the Transfer
and Servicing Agreement and have been pledged by the Trust to the Indenture
Trustee pursuant to the Indenture for the benefit of the Noteholders by
indicating in such computer files the transfer of the Receivables to the
Purchaser, or in the case of a Removed Account related to the Receivables, that
such Receivables have been reassigned to the Purchaser and (ii) on or prior to
(A) the Closing Date, in the case of
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the Initial Accounts, (B) the applicable Addition Date, in the case of
designation of Supplemental Accounts and (C) the applicable Removal Date, in the
case of Removed Accounts, and (iii) to deliver to the Purchaser a computer file
or microfiche list containing a true and complete list of all such Accounts
specifying for each such Account, as of the Initial Cut-Off Date, in the case of
the Initial Accounts, the applicable Addition Cut-Off Date, in the case of
Supplemental Accounts and the applicable Removal Date, in the case of Removed
Accounts, (1) its account number, (2) the aggregate amount outstanding in such
Account and (3) the aggregate amount of Principal Receivables in such Account.
Each such computer file or microfiche list, as supplemented from time to time to
reflect Additional Accounts or Removed Accounts, shall be marked as Schedule 1
to this Agreement, shall be delivered to the Purchaser and is hereby
incorporated into and made a part of this Agreement. The Seller further agrees
not to alter the computer code referenced in clause (i) of this paragraph with
respect to any Account during the term of this Agreement unless and until such
Account becomes a Removed Account.
(d) The parties hereto intend that the conveyance of the Seller's
right, title and interest in and to the Purchased Assets shall constitute an
absolute sale, conveying good title free and clear of any Liens or rights of
others from the Seller to the Purchaser. It is the intention of the parties
hereto that the arrangements with respect to the Purchased Assets shall
constitute a purchase and sale of such Purchased Assets and not a loan. In the
event, however, that it were to be determined that the transactions evidenced
hereby constitute a loan and not a purchase and sale, it is the intention of the
parties hereto that this Agreement shall constitute a security agreement under
applicable law, and that the Seller shall be deemed to have granted and does
hereby grant to the Purchaser a first priority perfected security interest, in
all of the Seller's right, title and interest, whether owned on the Initial
Cut-Off Date or thereafter acquired, in, to and under the Purchased Assets and
all money, accounts, payment intangibles, chattel paper, instruments, documents,
goods, investment property, deposit accounts, certificates of deposit, letters
of credit and advices of credit consisting of, arising from or related to the
Purchased Assets and all proceeds thereof to secure the obligations of the
Seller hereunder.
Section 2.02. Additional Accounts.
(a) If the Purchaser becomes obligated to designate Supplemental
Accounts pursuant to Section 2.09(a)(i) of the Transfer and Servicing Agreement,
then the Purchaser may, at its option, give the Seller written notice thereof on
or before the tenth Business Day (the "Addition Notice Date") prior to the
Addition Date therefor, and upon receipt of such notice the Seller shall on or
before the Addition Date, designate sufficient Eligible Accounts to be included
as Supplemental Accounts so that after the inclusion thereof the Purchaser will
be in compliance with the requirements of Section 2.09(a)(i) of the Transfer and
Servicing Agreement. Additionally, subject to Sections 2.09(b) and (c) of the
Transfer and Servicing Agreement and Section 2.02(b), from time to time Eligible
Accounts may be designated to be included as Supplemental Accounts, upon the
mutual agreement of the Purchaser and the Seller. In either event, the Seller
shall have sole responsibility for selecting such Supplemental Accounts.
(b) On the Addition Date with respect to any designation by the Seller
of Eligible Accounts to be Supplemental Accounts pursuant to Section 2.02(a),
the Purchaser shall purchase the Seller's right, title and interest in, to and
under the Receivables in such Supplemental
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Accounts (and such Receivables shall be deemed to be Receivables) and the
related Purchased Assets, subject to the satisfaction of the following
conditions on such Addition Date:
(i) all such Supplemental Accounts shall be Eligible Accounts;
(ii) the Seller shall have delivered to the Purchaser copies
of UCC-1 financing statements covering such Supplemental Accounts, if
necessary to perfect the Purchaser's interest in the Receivables
arising therein;
(iii) to the extent required of the Purchaser by Section
2.09(c) of the Transfer and Servicing Agreement, the Seller shall have
transferred to the Servicer for deposit in the Collection Account all
Collections with respect to such Supplemental Accounts since the
Addition Cut-Off Date;
(iv) as of each of the Addition Cut-Off Date and the Addition
Date, no Insolvency Event with respect to the Seller shall have
occurred nor shall the transfer of the Receivables arising in the
Supplemental Accounts to the Purchaser have been made in contemplation
of the occurrence thereof;
(v) the Rating Agency Condition shall have been satisfied with
respect to such Additional Account;
(vi) the Seller shall have delivered to the Purchaser an
Officer's Certificate, dated the Addition Date, confirming, to the
extent applicable, the items set forth in clauses (i) through (v)
above; and
(vii) the transfer of the Receivables arising in the
Supplemental Accounts to the Purchaser will not result in an Adverse
Effect and, in the case of such Supplemental Accounts, the Seller shall
have delivered to the Purchaser an Officer's Certificate, dated the
related Addition Date, stating that the Seller reasonably believes that
the transfer of the Receivables arising in such Supplemental Accounts
to the Purchaser will not have an Adverse Effect.
(c) In addition to designating Additional Accounts pursuant to Section
2.02(a), the Seller may, subject to the satisfaction by the Purchaser of the
conditions relating to the designation by the Purchaser of Accounts to the Trust
set forth in Section 2.09(a)(iii) of the Transfer and Servicing Agreement,
automatically convey newly originated Eligible Accounts to the Purchaser upon
their establishment.
Section 2.03. Delivery of Documents. In the case of the designation of
Supplemental Accounts, the Seller shall deliver to the Purchaser (i) the
computer file or microfiche list required to be delivered pursuant to Section
2.01(c) with respect to such Supplemental Accounts on the date such file or list
is required to be delivered pursuant to Section 2.01(c) (the "Document Delivery
Date") and (ii) a duly executed, written assignment (including an acceptance by
the Purchaser), substantially in the form of Exhibit A (the "Supplemental
Conveyance"), on the Document Delivery Date.
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Section 2.04. Representations and Warranties as to the Security
Interest of the Purchaser in the Receivables. The Seller makes the following
representations and warranties to the Purchaser. The representations and
warranties speak as of the execution and delivery of this Agreement and as of
the Closing Date. Such representations and warranties shall survive the sale,
transfer and assignment of the Receivables to the Transferor and the Trust, the
pledge thereof to the Indenture Trustee and the termination of this Agreement
and shall not be waived by any party hereto unless the Rating Agency Condition
is satisfied.
(a) This Agreement creates a valid and continuing security
interest (as defined in the applicable UCC) in the Receivables in favor
of the Purchaser, which security interest is prior to all other Liens
other than the Lien of each of the Indenture and the Trust, and is
enforceable as such as against creditors of and purchasers from the
Seller.
(b) The Receivables constitute "accounts" within the meaning
of the applicable UCC.
(c) The Seller owns and has good and marketable title to the
Receivables free and clear of any Lien, claim or encumbrance of any
Person.
(d) The Seller has caused or will have caused, within ten
days, the filing of all appropriate financing statements in the proper
filing office in the appropriate jurisdictions under applicable law in
order to perfect the security interest in the Receivables granted to
the Purchaser hereunder.
(e) Other than the security interest granted to the Purchaser
pursuant to this Agreement, the Seller has not pledged, assigned, sold,
granted a security interest in, or otherwise conveyed any of the
Receivables. The Seller has not authorized the filing of and is not
aware of any financing statements against the Seller that include a
description of collateral covering the Receivables other than any
financing statement relating to the security interest granted to the
Purchaser hereunder or that has been terminated. The Seller is not
aware of any judgment or tax lien filings against the Seller.
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ARTICLE THREE
CONSIDERATION AND PAYMENT
Section 3.01. Purchase Price. The Purchase Price for Receivables
relating to (i) Initial Accounts as of the Initial Cut-Off Date and the related
Purchased Assets conveyed to the Purchaser under this Agreement shall be payable
on the Closing Date and (ii) Initial Accounts, Additional Accounts and the
related Purchased Assets to be conveyed after the Closing Date to the Purchaser
under this Agreement, shall be payable in cash on the Distribution Date
following the Monthly Period in which such Receivables and the related Purchased
Assets are conveyed by the Seller to the Purchaser.
Section 3.02. Adjustments to Purchase Price. The Purchase Price shall
be adjusted on each Distribution Date by an amount equal to the Credit
Adjustment with respect to any one or more Receivables previously conveyed to
the Purchaser by the Seller which have since been reduced by the Seller or the
Servicer because of a rebate, refund, unauthorized charge or billing error to an
Obligor because such Receivable was created in respect of merchandise which was
refused or returned by an Obligor or due to the occurrence of any other event
referred to in Section 3.09 of the Transfer and Servicing Agreement. In the
event that the Credit Adjustment pursuant to this Section causes the Purchase
Price to be a negative number, the Seller agrees that, not later than 1:00 p.m.,
New York City time, on such Distribution Date, the Seller shall pay or cause to
be paid to the Purchaser an amount equal to the amount by which the Credit
Adjustment exceeds the Purchase Price. Notwithstanding the foregoing, if as a
result of the occurrence of any event giving rise to a Credit Adjustment,
Purchaser is required to deposit funds into the Special Funding Account pursuant
to Section 3.09 of the Transfer and Servicing Agreement, Seller shall pay
Purchaser an amount equal to such required deposit in immediately available
funds on or before the date Purchaser is required to make such deposit to the
Special Funding Account.
Section 3.03. Capital Contribution. Simultaneously with the closing of
the Purchaser of the private placement of the Offered Notes, the Seller shall
make a capital contribution to the Purchaser of $55,101,763 in consideration of
a membership interest in the Purchaser.
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ARTICLE FOUR
REPRESENTATIONS AND WARRANTIES
Section 4.01. Representations and Warranties of the Seller.
(a) The Seller hereby represents and warrants to, and agrees with, the
Purchaser as of the date of this Agreement, as of the Closing Date and on each
Addition Date, that:
(i) Organization and Good Standing. The Seller is a federal
savings bank validly existing under the laws of the United States of
America, with power and authority to own its properties and conduct its
business as such properties are currently owned and such business is
presently conducted, and had at all relevant times, and has, power,
authority and legal right to acquire, own and sell the Receivables. The
Seller is a member of the Federal Deposit Insurance Corporation.
(ii) Due Qualification. The Seller is duly qualified to do
business and has obtained all necessary licenses and approvals in each
jurisdiction in which the failure to so qualify or to obtain such
licenses and approvals would, in the reasonable judgment of the Seller,
materially and adversely affect the performance by the Seller of its
obligations under this Agreement and the Receivables Purchase
Agreements, or the validity or enforceability of this Agreement, the
Receivables Purchase Agreements or the Receivables.
(iii) Power and Authority. The Seller has the power and
authority to execute, deliver and perform its obligations under this
Agreement and to carry out its terms; and the execution, delivery and
performance of this Agreement, each Receivables Purchase Agreement, any
other document or instrument delivered pursuant hereto, including any
Supplemental Conveyance, to which the Seller is a party (the
"Conveyance Papers") and the sale of the Receivables has been duly
authorized by it by all necessary corporate action.
(iv) No Violation. The execution, delivery and performance by
the Seller of this Agreement, each Receivables Purchase Agreement, each
Conveyance Paper and the sale of the Receivables, the consummation of
the transactions contemplated hereby and by the Receivables Purchase
Agreements and the fulfillment of the terms hereof and thereof will not
conflict with, result in a breach of any of the terms and provisions
of, or constitute (with or without notice or lapse of time or both) a
default under, its charter or bylaws, or conflict with or breach any of
the material terms or provisions of, or constitute (with or without
notice or lapse of time or both) a default under, any indenture,
agreement or other instrument to which it is a party or by which it
shall be bound; nor result in the creation or imposition of any Lien
upon any of its properties pursuant to the terms of any such indenture,
agreement or other instrument (other than this Agreement); nor violate
any law or, to its knowledge, any order, rule or regulation applicable
to it of any court or of any federal or state regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over it or its properties, which breach,
12
default, conflict, Lien or violation would have a material adverse
effect on the Seller's earnings, business affairs or business prospects
or the Receivables.
(v) No Proceedings. There are no proceedings or investigations
pending, or to the best knowledge of the Seller, threatened against the
Seller, before any court, regulatory body, administrative agency or
other governmental instrumentality having jurisdiction over the Seller
or its properties: (A) asserting the invalidity of this Agreement, the
Receivables Purchase Agreements or the Conveyance Papers, (B) seeking
to prevent the issuance of the Notes or the consummation of any of the
transactions contemplated by this Agreement, the Receivables Purchase
Agreements or the Conveyance Papers, (C) seeking any determination or
ruling that might materially and adversely affect the performance by
the Seller of its obligations under this Agreement, the Receivables
Purchase Agreements or Conveyance Papers or (D) seeking to affect
adversely the income tax attributes of the Trust under federal or
applicable state income or franchise tax systems.
(vi) All Consents Required. All approvals, authorizations,
consents, orders or other actions of any Person or any Governmental
Authority required in connection with the execution and delivery by
Seller of this Agreement or any of the Conveyance Papers and the
performance of the transactions contemplated by this Agreement or any
of the Conveyance Papers by Seller have been obtained.
(vii) Insolvency. Seller is not insolvent and no Insolvency
Event with respect to Seller has occurred, and the transfer of the
Receivables and Purchased Assets by Seller to Purchaser contemplated
hereby has not been made in contemplation of such insolvency or
Insolvency Event.
(b) The representations and warranties set forth in this Section shall
survive the transfer and assignment of the Receivables to the Purchaser. Upon
discovery by the Seller or the Purchaser of a breach of any of the foregoing
representations and warranties, the party discovering such breach shall give
written notice to the other party, the Owner Trustee and the Indenture Trustee
within three Business Days following such discovery.
Section 4.02. Representations and Warranties as to the Agreement and
the Receivables.
(a) Representations and Warranties. The Seller hereby represents and
warrants to the Purchaser as of the date of this Agreement and as of the Closing
Date with respect to the Initial Accounts (and the Receivables arising therein),
and, with respect to Additional Accounts (and the Receivables arising therein),
as of the related Addition Date that:
(i) this Agreement and, in the case of Supplemental Accounts,
the related Supplemental Conveyance, each constitutes a legal, valid
and binding obligation of the Seller enforceable against the Seller in
accordance with its terms, except as such enforceability may be limited
by applicable Debtor Relief Laws or general principles of equity;
(ii) as of the Initial Cut-Off Date, with respect to the
Initial Accounts (and the Receivables arising therein) and as of the
related Addition Cut-Off Date with respect
13
to Additional Accounts (and the Receivables arising therein), Schedule
1 to this Agreement, as supplemented to such date, is an accurate and
complete listing in all material respects of all the Accounts relating
to Receivables as of the Initial Cut-Off Date or such Addition Cut-Off
Date, as the case may be, and the information contained therein with
respect to the identity of such Accounts and the Receivables existing
thereunder is true and correct in all material respects as of the
Initial Cut-Off Date or such applicable Addition Cut-Off Date, as the
case may be;
(iii) each Receivable conveyed to the Purchaser by the Seller
has been conveyed to the Purchaser free and clear of any Lien of any
Person claiming through or under the Seller or any of its Affiliates
(other than Liens permitted under Section 5.01(b)) and in compliance
with all Requirements of Law applicable to the Seller;
(iv) all authorizations, consents, orders or approvals of or
registrations or declarations with any Governmental Authority required
to be obtained, effected or given by the Seller in connection with the
conveyance by the Seller of the Receivables to the Purchaser have been
duly obtained, effected or given and are in full force and effect;
(v) this Agreement or, in the case of Supplemental Accounts,
the related Supplemental Conveyance, upon execution and delivery by the
Seller, constitutes an absolute sale, transfer and assignment to the
Purchaser of all right, title and interest of the Seller in the
Receivables and other Purchased Assets conveyed to the Purchaser by the
Seller and the proceeds thereof and Recoveries identified as relating
to the Receivables conveyed to the Purchaser by the Seller or, if this
Agreement or, in the case of Supplemental Accounts, the related
Supplemental Conveyance, does not constitute a sale of such property,
it constitutes a grant of a first priority perfected "security
interest" (as defined in the UCC) in such property to the Purchaser,
which, in the case of Receivables in Initial Accounts and the proceeds
thereof and Recoveries, is enforceable upon execution and delivery of
this Agreement, or, with respect to then existing Receivables in
Additional Accounts, as of the applicable Addition Date, and which will
be enforceable with respect to such Receivables hereafter and
thereafter created and the proceeds thereof upon such creation; and
upon the filing of the financing statements and, in the case of
Receivables hereafter created and the proceeds thereof, upon the
creation thereof, the Purchaser shall have a first priority perfected
security or ownership interest in such property and proceeds;
(vi) on the Initial Cut-Off Date, each Initial Account
specified in Schedule 1 with respect to the Seller is an Eligible
Account and, on the applicable Addition Cut-Off Date, each related
Additional Account specified in Schedule 1 with respect to the Seller
is an Eligible Account;
(vii) on the Initial Cut-Off Date, each Receivable in Initial
Accounts conveyed to the Purchaser by the Seller is an Eligible
Receivable and, on the applicable Addition Cut-Off Date, each
Receivable conveyed in the related Additional Accounts conveyed to the
Purchaser by the Seller is an Eligible Receivable;
(viii) as of the date of the creation of any new Receivable
transferred to the Purchaser by the Seller, such Receivable is an
Eligible Receivable; and
(ix) the Seller has used random selection procedures and no
selection procedures believed by the Seller to be materially adverse to
the interests of the Noteholders have been used in selecting Accounts
relating to Receivables.
(b) Notice of Breach. The representations and warranties set forth in
this Section shall survive the transfer and assignment of the Receivables to the
Purchaser and the transfer and assignment by the Purchaser of the Receivables to
the Issuer. Upon discovery by either the Seller or the Purchaser of a breach of
any of the representations and warranties set forth in this Section, the party
discovering such breach shall give written notice to the other party, the Owner
Trustee and the Indenture Trustee within three Business Days following such
discovery; provided that the failure to give notice within three Business Days
does not preclude subsequent notice. The Seller hereby acknowledges that the
Purchaser intends to rely on the representations hereunder in connection with
representations made by the Purchaser to secured parties, assignees or
subsequent transferees including transfers made by the Purchaser to the Trust
pursuant to the Transfer and Servicing Agreement and the pledge by the Trust to
the Indenture Trustee pursuant to the Indenture and that the Owner Trustee and
the Indenture Trustee may enforce such representations directly against the
Seller.
Section 4.03. Representations and Warranties of the Purchaser.
(a) As of the Closing Date and each Addition Date, the Purchaser hereby
represents and warrants to, and agrees with, the Seller that:
(i) Organization and Good Standing. The Purchaser has been
duly formed and is validly existing as a limited liability company in
good standing under the laws of the State of Delaware, with power and
authority to own its properties and to conduct its business as such
properties are currently owned and such business is presently
conducted, and had at all relevant times, and has, power, authority and
legal right to acquire, own and purchase the Receivables.
(ii) Due Qualification. The Purchaser is duly qualified to do
business as a foreign limited liability company in good standing and
has obtained all necessary licenses and approvals in each jurisdiction
in which the failure to so qualify or to obtain such licenses and
approvals would, in the reasonable judgment of the Purchaser,
materially and adversely affect the performance by the Purchaser of its
obligations under, or the validity or enforceability of, this
Agreement.
(iii) Power and Authority. The Purchaser has the power and
authority to execute, deliver and perform its obligations under this
Agreement and to carry out its terms; and the execution, delivery and
performance of this Agreement and the Conveyance Papers has been duly
authorized by the Purchaser by all necessary limited liability company
action.
(iv) No Violation. The execution, delivery and performance by
the Purchaser of this Agreement and the Conveyance Papers and of the
purchase of the
15
Receivables and the consummation of the transactions contemplated
hereby and by the Conveyance Papers and the fulfillment of the terms
hereof and thereof does not conflict with, result in any breach of any
of the terms and provisions of, nor constitute (with or without notice
or lapse of time or both) a default under, the limited liability
company agreement of the Purchaser, nor conflict with or violate any of
the material terms or provisions of, or constitute (with or without
notice or lapse of time or both) a default under, any indenture,
agreement or other instrument to which the Purchaser is a party or by
which it shall be bound; nor result in the creation or imposition of
any Lien upon any of its properties pursuant to the terms of any such
indenture, agreement or other instrument (other than this Agreement);
nor violate any law or any order, rule or regulation applicable to the
Purchaser of any court or of any federal or state regulatory body,
administrative agency or other governmental instrumentality having
jurisdiction over the Purchaser or its properties, which breach,
default, conflict, Lien or violation would have a material adverse
effect on the earnings, business affairs or business prospects of the
Purchaser or on the ability of the Purchaser to perform its obligations
under this Agreement.
(v) No Proceedings. There are no proceedings or investigations
pending, or to the best knowledge of the Purchaser, threatened against
the Purchaser, before any Governmental Authority having jurisdiction
over the Purchaser or its properties: (A) asserting the invalidity of
this Agreement or any Conveyance Papers, (B) seeking to prevent the
issuance of the Notes or the consummation of any of the transactions
contemplated by this Agreement, (C) seeking any determination or ruling
that might materially and adversely affect the performance by the
Purchaser of its obligations under this Agreement or the Conveyance
Papers or (D) seeking to affect adversely the income tax attributes of
the Trust under federal or applicable state income or franchise tax
systems.
(vi) All Consents Required. All approvals, authorizations,
consents, orders or other actions of any Person or any Governmental
Authority required in connection with the execution and delivery by
Purchaser of this Agreement or any of the Conveyance Papers and the
performance of the transactions contemplated by this Agreement or any
of the Conveyance Papers by Purchaser have been obtained, effected or
given and are in full force and effect.
(b) The representations and warranties set forth in this Section shall
survive the Conveyance of the Receivables to the Purchaser. Upon discovery by
the Purchaser or the Seller of a breach of any of the foregoing representations
and warranties, the party discovering such breach shall give prompt written
notice to the other party, the Owner Trustee and the Indenture Trustee.
16
ARTICLE FIVE
COVENANTS
Section 5.01. Covenants of the Seller. The Seller hereby covenants and
agrees with the Purchaser as follows:
(a) Receivables Not to be Evidenced by Promissory Notes.
Except in connection with its enforcement or collection of any
Receivable, the Seller will take no action to cause any Receivable
conveyed by it to the Purchaser to be evidenced by any instrument (as
defined in the UCC) and if any Receivable is so evidenced (whether or
not in connection with the enforcement or collection of a Receivable),
it shall be deemed to be an Ineligible Receivable and shall be
reassigned to the Seller in accordance with Section 6.01(b).
(b) Security Interests. Except for the conveyances hereunder,
the Seller will not sell, pledge, assign or transfer to any other
Person, or grant, create, incur, assume or suffer to exist any Lien on,
any Receivable conveyed by it to the Purchaser, whether now existing or
hereafter created, or any interest therein, and the Seller shall defend
the right, title and interest of the Purchaser in, to and under the
Receivables, whether now existing or hereafter created, against all
claims of third parties claiming through or under the Seller; provided,
however, that nothing in this Section shall prevent or be deemed to
prohibit the Seller from suffering to exist upon any of the Receivables
transferred by it to the Purchaser any Liens for municipal or other
local taxes if such taxes shall not at the time be due and payable or
if the Seller shall currently be contesting the validity thereof in
good faith by appropriate proceedings and shall have set aside on its
books adequate reserves with respect thereto.
(c) Account Allocations. In the event that the Seller is
unable for any reason to transfer Receivables to the Purchaser in
accordance with the provisions of this Agreement (including by reason
of the application of the provisions of Section 8.02 or any order of
any Governmental Authority), then the Seller agrees (except as
prohibited by any such order) to allocate and pay to the Purchaser,
after the date of such inability, all amounts in the manner by which
the Purchaser will allocate and pay such amounts to the Trust after
such inability by the Purchaser to transfer Receivables to the Trust
pursuant to Section 2.11 of the Transfer and Servicing Agreement.
(d) Delivery of Collections or Recoveries. In the event that
the Seller receives Collections or Recoveries, the Seller agrees to pay
to the Purchaser (or to the Servicer if the Purchaser so directs) all
such Collections and Recoveries as soon as practicable after receipt
thereof but in no event later than two Business Days after the Date of
Processing thereof.
(e) Notice of Liens. The Seller shall notify the Purchaser
promptly after becoming aware of any Lien on any Receivable (or on the
underlying receivable) other than the conveyances hereunder, under any
Receivables Purchase Agreements, under the Transfer and Servicing
Agreement or under the Indenture.
17
(f) Continuous Perfection. The Seller shall not change its
name, identity or structure in any manner that might cause any
financing or continuation statement filed pursuant to this Agreement to
be seriously misleading unless the Seller shall have delivered to the
Purchaser at least 30 days' prior written notice thereof and, no later
than 30 days after making such change, shall have taken all action
necessary or advisable to amend such financing statement or
continuation statement so that it is not misleading. The Seller shall
not change the jurisdiction under whose laws it is organized, its chief
execution office or change the location of its principal records
concerning the Receivables unless it has delivered to the Purchaser at
least 30 days' prior written notice of its intention to do so and has
taken such action as is necessary or advisable to cause the interest of
the Purchaser in the Receivables and other Purchased Assets to continue
to be perfected with the priority required by this Agreement.
(g) Interchange. With respect to any Distribution Date, on or
prior to the immediately preceding Determination Date, the Servicer
shall notify the Seller of the amount of Interchange required to be
included as Collections of Finance Charge Receivables with respect to
such Monthly Period, which amount for any Series shall be specified in
the related Indenture Supplement. Not later than 1:00 p.m., New York
City time, on the related Transfer Date, the Seller shall deposit, or
cause to be deposited, into the Collection Account, in immediately
available funds, the amount of the Interchange to be so included as
Collections of Finance Charge Receivables with respect to such Monthly
Period.
Section 5.02. Covenants of the Seller with Respect to Receivables
Purchase Agreements. The Seller, in its capacity as purchaser of Receivables
from the Account Owner pursuant to the Receivables Purchase Agreements between
the Seller and the Account Owner, hereby covenants that it will at all times
enforce the covenants and agreements of the Account Owner in such Receivables
Purchase Agreements, including covenants substantially to the effect set forth
below:
(a) Periodic Rate Finance Charges. Except (i) as otherwise
required by any Requirements of Law or (ii) as is deemed by the Account
Owner to be necessary in order for it to maintain its credit card
business on a competitive basis based on a good faith assessment by it
of the nature of the competition in the credit card business, it shall
not at any time reduce the annual percentage rate of the Periodic Rate
Finance Charges assessed on the Receivables transferred by it to the
Purchaser or other fees charged on any of the Accounts owned by it if
either (A) as a result of any such reduction, such Account Owner's
reasonable expectation is that such reduction will cause a Pay Out
Event or Event of Default to occur or (B) such reduction is not also
applied to all comparable segments of the VISA(R) or other retail
consumer revolving credit card accounts owned by such Account Owner
which have characteristics the same as, or substantially similar to,
such Accounts.
(b) Credit Card Agreements and Guidelines. Subject to
compliance with all Requirements of Law and Section 5.02(a), the
Account Owner may change the terms and provisions of the Credit Card
Agreements or the Credit Card Guidelines with respect to any of the
Accounts owned by it in any respect (including the calculation of the
amount
18
or the timing of charge-offs and the Periodic Rate Finance Charges and
other fees to be assessed thereon) only if such change is made
applicable to all comparable segments of the VISA(R) or other retail
consumer revolving credit card accounts owned by such Account Owner
which have characteristics the same as, or substantially similar to,
such Accounts. Notwithstanding the foregoing, unless required by
Requirements of Law or as permitted by Section 5.02(a), no Account
Owner will take any action with respect to the Credit Card Agreements
or the Credit Card Guidelines, which, at the time of such action, the
Account Owner reasonably believes will have a material adverse effect
on the Noteholders.
The Seller further covenants that it will not enter into any amendments
to the Receivables Purchase Agreements or enter into a new Receivables Purchase
Agreement unless the Rating Agency Condition has been satisfied.
The Purchaser covenants that it will provide the Seller with such
information as the Seller may reasonably request to enable the Seller to
determine compliance with the covenants contained in Section 5.02(b).
19
ARTICLE SIX
REPURCHASE OBLIGATION
Section 6.01. Reassignment of Ineligible Receivables.
(a) In the event any representation or warranty under Section
4.02(a)(ii), (iii), (iv), (vi), (vii), (viii) or (ix) is not true and correct in
any material respect as of the date specified therein with respect to any
Receivable or the related Account and as a result of such breach the Purchaser
is required to accept reassignment of Ineligible Receivables previously sold by
the Seller to the Purchaser pursuant to Section 2.05(a) of the Transfer and
Servicing Agreement, the Seller shall accept reassignment of such Ineligible
Receivables on the terms and conditions set forth in Section 6.01(b).
(b) The Seller shall accept reassignment of any Ineligible Receivables
previously sold by the Seller to the Purchaser from the Purchaser on the date on
which such reassignment obligation arises, and shall pay for such reassigned
Ineligible Receivables by paying to the Purchaser, not later than 3:00 p.m., New
York City time, on such date, an amount equal to the product of (i) 100% and
(ii) the sum of (A) the unpaid principal balance of such Ineligible Receivables
plus (B) accrued and unpaid finance charges at the annual percentage rate
applicable to such Receivables from the last date billed through the end of the
Monthly Period in which such reassignment obligation arises. Upon reassignment
of such Ineligible Receivables, the Purchaser shall automatically and without
further action be deemed to sell, transfer, assign, set-over and otherwise
convey to the Seller, without recourse, representation or warranty, all the
right, title and interest of the Purchaser in and to such Ineligible
Receivables, all Recoveries related thereto, all monies and amounts due or to
become due with respect thereto and all proceeds thereof; and such reassigned
Ineligible Receivables shall be treated by the Purchaser as collected in full as
of the date on which they were transferred. The Purchaser shall execute such
documents and instruments of transfer or assignment and take such other actions
as shall reasonably be requested by the Seller to effect the conveyance of such
Ineligible Receivables and other property pursuant to this subsection.
Section 6.02. Reassignment. In the event any representation or warranty
set forth in Section 4.01(a) or (c) or Section 4.02(a)(i) or (v) is not true and
correct in any material respect and as a result of such breach the Purchaser is
required to accept a reassignment of the Receivables previously sold by the
Seller to the Purchaser pursuant to Section 2.06 of the Transfer and Servicing
Agreement, the Seller shall be obligated to accept a reassignment of such
Receivables on the terms set forth below.
The Seller shall pay to the Purchaser by depositing in the Collection
Account in immediately available funds, not later than 1:00 p.m., New York City
time, two Business Days after which such reassignment obligation arises, in
payment for such reassignment, an amount equal to the amount specified in
Section 2.06 of the Transfer and Servicing Agreement. Upon reassignment of the
Receivables on such Transfer Date, the Purchaser shall automatically and without
further action be deemed to sell, transfer, assign, set-over and otherwise
convey to the Seller, without recourse, representation or warranty, all the
right, title and interest of the Purchaser in and to the Receivables, all
Recoveries related thereto and all monies and amounts
20
due or to become due with respect thereto and all proceeds thereof. The
Purchaser shall execute such documents and instruments of transfer or assignment
and take such other actions as shall reasonably be requested by the Seller to
effect the conveyance of such property pursuant to this Section.
21
ARTICLE SEVEN
CONDITIONS PRECEDENT
Section 7.01. Conditions to the Purchaser's Obligations Regarding
Initial Receivables. The obligations of the Purchaser to purchase the
Receivables in the Initial Accounts on the Closing Date shall be subject to the
satisfaction of the following conditions:
(a) all representations and warranties of the Seller contained
in this Agreement shall be true and correct on the Closing Date with
the same effect as though such representations and warranties had been
made on such date;
(b) all information concerning the Initial Accounts provided
to the Purchaser shall be true and correct as of the Initial Cut-Off
Date in all material respects;
(c) the Seller shall have (i) delivered to the Purchaser a
computer file or microfiche list containing a true and complete list of
all Initial Accounts identified by account number and by the
Receivables balance as of the Initial Cut-Off Date and (ii)
substantially performed all other obligations required to be performed
by the provisions of this Agreement;
(d) the Seller shall have recorded and filed, at its expense,
any financing statement with respect to the Receivables (other than
Receivables in Additional Accounts) now existing and hereafter created
for the transfer of accounts (as defined in the applicable UCC) meeting
the requirements of applicable law in such manner and in such
jurisdictions as would be necessary to perfect the sale of and security
interest in the Receivables from the Seller to the Purchaser, and shall
deliver a file-stamped copy of such financing statements or other
evidence of such filings to the Purchaser;
(e) on or before the Closing Date, (i) the Purchaser and the
Owner Trustee shall have entered into the Trust Agreement, (ii) the
Purchaser, the Bank, the Indenture Trustee and the Trust shall have
entered into the Transfer and Servicing Agreement, (iii) the Trust and
the Indenture Trustee shall have entered into the Indenture and (iv)
the closing under all such agreements shall take place simultaneously
with the initial closing hereunder; and
(f) all corporate and legal proceedings and all instruments in
connection with the transactions contemplated by this Agreement shall
be satisfactory in form and substance to the Purchaser, and the
Purchaser shall have received from the Seller copies of all documents
(including records of corporate proceedings) relevant to the
transactions herein contemplated as the Purchaser may reasonably have
requested.
Section 7.02. Conditions Precedent to the Seller's Obligations. The
obligations of the Seller to sell Receivables in the Initial Accounts on the
Closing Date shall be subject to the satisfaction of the following conditions:
22
(a) all representations and warranties of the Purchaser
contained in this Agreement shall be true and correct with the same
effect as though such representations and warranties had been made on
such date;
(b) payment or provision for payment of the Purchase Price in
accordance with the provision of Section 3.01 shall have been made; and
(c) all corporate and legal proceedings and all instruments in
connection with the transactions contemplated by this Agreement shall
be satisfactory in form and substance to the Seller, and the Seller
shall have received from the Purchaser copies of all documents
(including records of corporate proceedings) relevant to the
transactions herein contemplated as the Seller may reasonably have
requested.
23
ARTICLE EIGHT
TERM AND PURCHASE TERMINATION
Section 8.01. Term. This Agreement shall commence as of the date of
execution and delivery hereof and shall continue until at least the termination
of the Trust as provided in Article Eight of the Trust Agreement. Thereafter,
this Agreement may be terminated by the mutual agreement of the parties hereto.
Section 8.02. Purchase Termination. If an Insolvency Event occurs with
respect to the Seller, then the Seller shall immediately cease to transfer
Principal Receivables to the Purchaser and shall promptly give notice to the
Purchaser, the Owner Trustee and the Indenture Trustee of such Insolvency Event.
Notwithstanding any cessation of the transfer to the Purchaser of additional
Principal Receivables, Principal Receivables transferred to the Purchaser prior
to the occurrence of such Insolvency Event and Collections in respect of such
Principal Receivables and Finance Charge Receivables whenever created, accrued
in respect of such Principal Receivables, shall continue to be property of the
Purchaser available for transfer by the Purchaser to the Trust pursuant to the
Transfer and Servicing Agreement.
24
ARTICLE NINE
MISCELLANEOUS PROVISIONS
Section 9.01. Amendment. This Agreement and any Conveyance Papers and
the rights and obligations of the parties hereunder and thereunder may not be
changed orally, but only by an instrument in writing signed by the Purchaser and
the Seller in accordance with this Section. This Agreement and any Conveyance
Papers may be amended from time to time by the Purchaser and the Seller (i) to
cure any ambiguity, (ii) to correct or supplement any provisions herein which
may be inconsistent with any other provisions herein or in any such other
Conveyance Papers, (iii) to add any other provisions with respect to matters or
questions arising under this Agreement or any Conveyance Papers which shall not
be inconsistent with the provisions of this Agreement or any Conveyance Papers,
(iv) to change or modify the Purchase Price and (v) to change, modify, delete or
add any other obligation of the Seller or the Purchaser; provided, however, that
no amendment pursuant to clause (ii), (iii), (iv) or (v) shall be effective
unless the Seller and the Purchaser have been notified in writing that the
Rating Agency Condition has been satisfied; provided further that the Seller
shall have delivered to the Purchaser an Officer's Certificate, dated the date
of such action, stating that the Seller reasonably believes that such action
will not have an Adverse Effect unless the Owner Trustee and the Indenture
Trustee shall consent thereto. Any reconveyance executed in accordance with the
provisions hereof shall not be considered to be an amendment to this Agreement.
A copy of any amendment to this Agreement shall be sent to the Rating Agency.
Section 9.02. Governing Law. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS (OTHER THAN SECTION 5-1041 OF THE GENERAL OBLIGATIONS
LAW), AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE
DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 9.03. Notices. Unless otherwise expressly specified or
permitted by the terms hereof, all demands, notices, instruction, directions and
communications hereunder shall be in writing and shall be deemed to have been
duly given if personally delivered at, mailed by registered mail, return receipt
requested or sent by facsimile transmission to (i) in the case of the Seller,
0000 Xxxx Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxxxxxx, Xxxxxxx 00000-0000, Attention:
Legal Department (facsimile no. (000) 000-0000), (ii) in the case of the
Purchaser, 00000 Xxxx Xxxxx Xxxxxx, Xxxxxxxxx, Xxxxxxxx 00000, Attention: Legal
Department (facsimile no. (000) 000-0000), (iii) in the case of the Owner
Trustee, Xxxxxx Square North, 0000 Xxxxx Xxxxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxx
00000-0000, Attention: Corporate Trust Administration (facsimile no. (302)
651-1576), (iv) in the case of the Indenture Trustee, 0000 Xxxxxxxx, Xxxxxx,
Xxxxxxxx 00000-0000, Attention: Corporate Trust and Escrow Services (facsimile
no. (000) 000-0000); or (v) as to each party, at such other address or facsimile
number as shall be designated by such party in a written notice to each other
party.
Section 9.04. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement or any Conveyance
Paper shall for any reason whatsoever be held invalid, then such covenants,
agreements, provisions or terms shall be
25
deemed severable from the remaining covenants, agreements, provisions or terms
of this Agreement or any Conveyance Paper and shall in no way affect the
validity or enforceability of the remaining covenants, agreements, provisions or
terms of this Agreement or of any Conveyance Paper.
Section 9.05. Merger, Consolidation of, or Assignment of Obligations of
Seller.
(a) The Seller shall not consolidate with or merge into any other
corporation or convey or transfer its properties and assets substantially as an
entirety to any Person unless:
(i) the Person formed by such consolidation or into which the
Seller is merged or the Person which acquires by conveyance or transfer
the properties and assets of Seller substantially as an entirety shall
be, if the Seller is not the surviving entity, an entity organized and
existing under the laws of the United States or any State and if the
Seller is not the surviving entity, such entity expressly assumes, by
an agreement supplemental hereto, executed and delivered to the
Purchaser and the Indenture Trustee in form reasonably satisfactory to
the Purchaser and the Indenture Trustee, the performance of every
covenant and obligation of the Seller hereunder;
(ii) the Seller has delivered to the Purchaser and the
Indenture Trustee (A) an Officer's Certificate stating that such
consolidation, merger, conveyance or transfer and such supplemental
agreement comply with this Section and that all conditions precedent
herein provided for relating to such transaction have been complied
with and (B) an Opinion of Counsel to the effect that such supplemental
agreement is a valid and binding obligation of such surviving entity
enforceable against such surviving entity in accordance with its terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
creditors' rights generally from time to time in effect and except as
such enforceability may be limited by general principles of equity
(whether considered in a suit at law or in equity);
(iii) the Seller shall have delivered to the Purchaser and
Indenture Trustee and each Rating Agency a Tax Opinion, dated the date
of such consolidation, merger, conveyance or transfer; and
(iv) if the Seller is not the surviving entity, the surviving
entity shall file new UCC-1 financing statements with respect to the
interest of the purchaser in the Receivables.
(b) This Section shall not be construed to prohibit or in any way limit
the Seller's ability to effectuate any consolidation or merger pursuant to which
the Seller would be the surviving entity.
(c) The Seller shall notify each Rating Agency promptly after any
consolidation, merger, conveyance or transfer effected pursuant to this Section;
(d) The obligations of the Seller hereunder shall not be assignable nor
shall any Person succeed to the obligations of the Seller hereunder except in
each case in accordance with
26
(i) the provisions of the foregoing paragraphs or (ii) conveyances, mergers,
consolidations, assumptions, sales or transfers to other entities (A) for which
the Seller delivers an Officer's Certificate to the Purchaser and the Indenture
Trustee indicating that the Seller reasonably believes that such action will not
adversely affect in any material respect the interests of the Purchaser or any
Noteholder, (B) which meet the requirements of clause (ii) of paragraph (a) and
(C) for which such purchaser, transferee, pledgee or entity shall expressly
assume, in an agreement supplemental hereto, executed and delivered to the
Purchaser and the Indenture Trustee in writing in form satisfactory to the
Seller and the Indenture Trustee, the performance of every covenant and
obligation of the Seller thereby conveyed.
Section 9.06. Acknowledgement and Agreement of the Seller. By execution
below, the Seller expressly acknowledges and agrees that all of the Purchaser's
right, title, and interest in, to, and under this Agreement, including all of
the Purchaser's right, title, and interest in and to the Receivables purchased
pursuant to this Agreement, may be assigned by the Purchaser to the Trust, and a
security interest therein may be granted by the Trust to the Indenture Trustee
for the benefit of the beneficiaries of the Trust, including the Noteholders,
and the Seller consents to such assignment and grant. The Seller further agrees
that notwithstanding any claim, counterclaim, right of setoff or defense which
it may have against the Purchaser, due to a breach by the Purchaser of this
Agreement or for any other reason, and notwithstanding the bankruptcy of the
Purchaser or any other event whatsoever, the Seller's sole remedy shall be a
claim against the Purchaser for money damages, and then only to the extent of
funds available to the Purchaser, and in no event shall the Seller assert any
claim on or any interest in the Receivables or any proceeds thereof or take any
action which would reduce or delay receipt by the Trust of collections with
respect to the Receivables. Additionally, the Seller agrees that any amounts
payable by the Seller to the Purchaser hereunder which are to be paid by the
Purchaser to the Indenture Trustee shall be paid by the Seller, on behalf of the
Purchaser, directly to the Indenture Trustee.
Section 9.07. Further Assurances. The Purchaser and the Seller agree to
do and perform, from time to time, any and all acts and to execute any and all
further instruments required or reasonably requested by the other party and
their respective permitted successors and assigns, the Owner Trustee or the
Indenture Trustee more fully to effect the purposes of this Agreement and the
Conveyance Papers, including the execution of any financing statements or
continuation statements relating to the Receivables for filing under the
provisions of the UCC of any applicable jurisdiction.
Section 9.08. No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of the Purchaser or the Seller, any
right, remedy, power or privilege under this Agreement, shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege under this Agreement preclude any other or further exercise
thereof or the exercise of any other right, remedy, power or privilege. The
rights, remedies, powers and privileges provided under this Agreement are
cumulative and not exhaustive of any rights, remedies, powers and privileges
provided by law.
Section 9.09. Counterparts. This Agreement and all Conveyance Papers
may be executed in separate counterparts, each of which when so executed and
delivered shall be an original, but all of which together shall constitute one
and the same instrument.
27
Section 9.10. Third-Party Beneficiaries. This Agreement and the
Conveyance Papers will inure to the benefit of and be binding upon the parties
hereto and their respective successors and permitted assigns. The Trust and the
Indenture Trustee shall be considered third-party beneficiaries of this
Agreement. Except as otherwise expressly provided in this Agreement, no other
Person will have any right or obligation hereunder.
Section 9.11. Merger and Integration. Except as specifically stated
otherwise herein, this Agreement and the Conveyance Papers set forth the entire
understanding of the parties relating to the subject matter hereof, and all
prior understandings, written or oral, are superseded by this Agreement and the
Conveyance Papers. This Agreement and the Conveyance Papers may not be modified,
amended, waived or supplemented except as provided herein.
Section 9.12. Effect of Headings and Table of Contents. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
Section 9.13. Schedules and Exhibits. The schedules and exhibits
attached hereto and referred to herein shall constitute a part of this Agreement
and are incorporated into this Agreement for all purposes.
Section 9.14. Survival of Representations and Warranties. All
representations, warranties and agreements contained in this Agreement or
contained in any Supplemental Conveyance shall remain operative and in full
force and effect and shall survive conveyance of the Receivables by the
Purchaser to the Trust pursuant to the Transfer and Servicing Agreement and the
grant of a security interest therein by the Trust to the Indenture Trustee
pursuant to the Indenture.
Section 9.15. Nonpetition Covenant. To the fullest extent permitted by
law, notwithstanding any prior termination of this Agreement, the Seller shall
not, prior to the date which is one year and one day after the termination of
this Agreement, acquiesce, petition or otherwise invoke or cause the Purchaser
or the Trust to invoke the process of any Governmental Authority for the purpose
of commencing or sustaining a case against the Purchaser or the Trust under any
Debtor Relief Law or appointing a receiver, conservator, liquidator, assignee,
trustee, custodian, sequestrator or other similar official of the Purchaser or
the Trust or any substantial part of its property or ordering the winding-up or
liquidation of the affairs of the Purchaser or the Trust.
28
IN WITNESS WHEREOF, the Purchaser and the Seller have caused this
Receivables Purchase Agreement to be duly executed by their respective officers
as of the day and year first above written.
NORDSTROM fsb,
as Seller
By: /s/ Xxxxx X. Xxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President
NORDSTROM CREDIT CARD RECEIVABLES LLC,
as Servicer
By: /s/ Xxxxx X. Xxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President
29
EXHIBIT A
FORM OF SUPPLEMENTAL CONVEYANCE
(As required by Section 2.03 of the Receivables Purchase Agreement)
This Supplemental Conveyance No. ___ dated as of ____________, 200_, is
between Nordstrom fsb, as seller (the "Seller"), and Nordstrom Credit Card
Receivables LLC, as purchaser (the "Purchaser"), pursuant to the Receivables
Purchase Agreement referred to below.
WHEREAS, the Seller and the Purchaser are parties to a receivables
purchase agreement, dated as of April 1, 2002 (as such agreement may have been
amended or supplemented from time to time, the "Receivables Purchase
Agreement");
WHEREAS, pursuant to the Receivables Purchase Agreement, the Seller
wishes to designate Additional Accounts to be included as Accounts and the
Seller wishes to convey its right, title and interest in the Receivables of such
Additional Accounts, whether now existing or hereafter created, to the Purchaser
pursuant to the Receivables Purchase Agreement (as each such term is defined in
the Receivables Purchase Agreement); and
WHEREAS, the Purchaser is willing to accept such designation and
conveyance subject to the terms and conditions hereof.
NOW, THEREFORE, the Seller and the Purchaser hereby agree as follows:
1. Defined Terms. Capitalized terms used herein that are not otherwise
defined shall have the meanings ascribed thereto in the Receivables Purchase
Agreement.
"Addition Date" means, with respect to the Additional Accounts
designated hereby __________ ___, ____.
"Addition Cut-Off Date" means, with respect to the Additional Accounts
designated hereby, __________ ___, ____.
2. Designation of Additional Accounts. The Seller delivers herewith a
computer file or microfiche list containing a true and complete schedule
identifying all such Additional Accounts (the "Additional Accounts") and
specifying for each such Additional Account, as of the Addition Cut-Off Date,
its account number, the aggregate amount outstanding in such Account and the
aggregate amount of Principal Receivables in such Account. Such computer file,
microfiche list or other documentation shall be as of the date of this
Supplemental Conveyance incorporated into and made part of this Supplemental
Conveyance and is marked as Schedule 1 to this Supplemental Conveyance.
3. Conveyance of Receivables.
(a) The Seller does hereby sell, transfer, assign, set over
and otherwise convey to the Purchaser, without recourse except as
provided in the Receivables Purchase
A-1
Agreement, all its right, title and interest in, to and under the
Receivables arising in such Additional Accounts, existing at the close
of business on the Addition Cut-Off Date and thereafter created until
termination of the Receivables Purchase Agreement, all Interchange and
Recoveries with respect to such Receivables, all monies due or to
become due and all amounts received or receivable with respect thereto
and all proceeds thereof.
(b) In connection with such sale and if necessary, the Seller
agrees to record and file, at its own expense, one or more financing
statements (and continuation statements with respect to such financing
statements when applicable) with respect to the Receivables, existing
on the Addition Cut-Off Date and thereafter created, meeting the
requirements of applicable state law in such manner and in such
jurisdictions as are necessary to perfect the sale and assignment of
and the security interest in the Receivables to the Purchaser, and to
deliver a file-stamped copy of such financing statement or other
evidence of such filing to the Purchaser.
(c) In connection with such sale, the Seller further agrees,
at its own expense, on or prior to the date of this Supplemental
Conveyance, to indicate in the appropriate computer files or microfiche
list that all Receivables created in connection with the Additional
Accounts designated hereby have been conveyed to the Purchaser pursuant
to this Supplemental Conveyance.
4. Acceptance by the Purchaser. The Purchaser hereby acknowledges its
acceptance of all right, title and interest to the property, existing on the
Addition Cut-Off Date and thereafter created, conveyed to the Purchaser pursuant
to Section 3(a) and declares that it shall maintain such right, title and
interest. The Purchaser further acknowledges that, prior to or simultaneously
with the execution and delivery of this Supplemental Conveyance, the Seller
delivered to the Purchaser the computer file or microfiche list described in
Section 2.
5. Representations and Warranties of the Seller. The Seller hereby
represents and warrants to the Purchaser as of the date of this Supplemental
Conveyance and as of the Addition Date that:
(a) Legal, Valid and Binding Obligation. This Supplemental
Conveyance constitutes a legal, valid and binding obligation of the
Seller enforceable against the Seller in accordance with its terms,
except as such enforceability may be limited by applicable Debtor
Relief Laws or general principles of equity.
(b) Eligibility of Accounts. On the Addition Cut-Off Date, each
Additional Account designated hereby is an Eligible Account.
(c) No Liens. Each Receivable in an Additional Account designated
hereby has been conveyed to the Purchaser free and clear of any Lien
and each underlying receivable is free and clear of all Liens.
(d) Eligibility of Receivables. On the Addition Cut-Off Date, each
Receivable existing in an Additional Account designated hereby is an
Eligible Receivable
A-2
and as of the date of creation of any Receivable in an Additional
Account designated hereby, such Receivable is an Eligible Receivable.
(e) Selection Procedures. Each Account has been randomly selected
and no selection procedures believed by the Seller to be adverse to the
interests of the Purchaser or the Noteholders were utilized in
selecting the Additional Accounts.
(f) Transfer of Receivables. This Supplemental Conveyance
constitutes an absolute sale, transfer and assignment to the Purchaser
of all right, title and interest of the Seller in the Receivables
arising in the Additional Accounts designated hereby existing on the
Addition Cut-Off Date or thereafter created, the Recoveries with
respect thereto, all monies due or to become due and all amounts
received with respect thereto and the "proceeds" (including "proceeds"
as defined in Article 9 of the UCC) thereof.
(g) No Conflict. The execution and delivery of this Supplemental
Conveyance, the performance of the transactions contemplated by this
Supplemental Conveyance and the fulfillment of the terms hereof, will
not conflict with, result in any breach of any of the material terms
and provisions of, or constitute (with or without notice or lapse of
time or both) a material default under, any indenture, contract,
agreement, mortgage, deed of trust or other instrument to which the
Seller is a party or by which it or its properties are bound.
(h) No Violation. The execution and delivery of this Supplemental
Conveyance by the Seller, the performance of the transactions
contemplated by this Supplemental Conveyance and the fulfillment of the
terms hereof applicable to the Seller will not conflict with or violate
any Requirements of Law applicable to the Seller.
(i) No Proceedings. There are no proceedings or investigations,
pending or, to the best knowledge of the Seller, threatened, against
the Seller before any Governmental Authority (i) asserting the
invalidity of this Supplemental Conveyance, (ii) seeking to prevent the
consummation of any of the transactions contemplated by this
Supplemental Conveyance, (iii) seeking any determination or ruling
that, in the reasonable judgment of the Seller, would materially and
adversely affect the performance by the Seller of its obligations under
this Supplemental Conveyance or (iv) seeking any determination or
ruling that would materially and adversely affect the validity or
enforceability of this Supplemental Conveyance.
(j) All Consents. All authorizations, consents, orders or approvals
of any Governmental Authority required to be obtained by the Seller in
connection with the execution and delivery of this Supplemental
Conveyance by the Seller and the performance of the transactions
contemplated by this Supplemental Conveyance by the Seller, have been
obtained.
6. Ratification of the Receivables Purchase Agreement. The Receivables
Purchase Agreement is hereby ratified, and all references to the "Receivables
Purchase Agreement", "this Agreement" and "herein" shall be deemed from and
after the Addition Date to be a reference to the Receivables Purchase Agreement
as supplemented by this Supplemental Conveyance.
A-3
Except as expressly amended hereby, all the representations, warranties, terms,
covenants and conditions of the Receivables Purchase Agreement shall remain
unamended and shall continue to be, and shall, remain, in full force and effect
in accordance with its terms and except as expressly provided herein shall not
constitute or be deemed to constitute a waiver of compliance with or consent to
non-compliance with any term or provision of the Receivables Purchase Agreement.
7. Counterparts. This Supplemental Conveyance may be executed in
separate counterparts, each of which when so executed and delivered shall be an
original, but all of which together shall constitute one and the same
instrument.
8. Governing Law. This Supplemental Conveyance shall be construed in
accordance with the laws of the State of New York, without reference to its
conflict of law provisions (other than Section 5-1401 of the General Obligations
Law), and the obligations, rights and remedies of the parties hereunder shall be
determined in accordance with such laws.
A-4
IN WITNESS WHEREOF, the undersigned have caused this Supplemental
Conveyance to be duly executed and delivered by their respective duly authorized
officers on the day and the year first above written.
NORDSTROM fsb,
as Seller
By:
------------------------------------
Name:
Title:
NORDSTROM CREDIT CARD RECEIVABLES LLC,
as Purchaser
By:
------------------------------------
Name:
Title:
A-5
Schedule 1 to
Supplemental
Conveyance
Additional Accounts
A-6
Schedule 1
List of Accounts
[Delivered to the Owner Trustee and Indenture Trustee at Closing]
S-1
