EXHIBIT 10.18
NEIMAN MARCUS FUNDING CORPORATION,
Seller
THE NEIMAN MARCUS GROUP, INC.,
Servicer
and
THE BANK OF NEW YORK,
Trustee
NEIMAN MARCUS GROUP CREDIT CARD MASTER TRUST
POOLING AND SERVICING AGREEMENT
Dated as of March 1, 1995
and amended and restated as of July 2, 2000
TABLE OF CONTENTS
Page
ARTICLE I
Definitions
Section 1.01 Definitions . . . . . . . . . . . . . . . . . .1
Section 1.02 Other Definitional Provisions . . . . . . . . 21
ARTICLE II
Conveyance of Receivables
Section 2.01 Conveyance of Receivables . . . . . . . . . . 22
Section 2.02 Acceptance by Trustee . . . . . . . . . . . . 23
Section 2.03 Representations and Warranties of the Seller Relating to
the Seller . . . . . . 24
Section 2.04 Representations and Warranties of the Seller Relating to
the Agreement and any Supplement and the Receivables . . . . . . . . 26
Section 2.05 Reassignment of Ineligible Receivables . . . 28
Section 2.06 Reassignment of Receivables in Trust Portfolio. . 30
Section 2.07 Covenants of the Seller . . . . . . . . . . . 31
Section 2.08 Covenants of The Seller with Respect to the Purchase
Agreements
34
Section 2.09 Addition of Accounts . . 35
Section 2.10 Removal of Accounts . . . . . . . . . . . . . 39
Section 2.11 Account Allocations . . . . . . . . . . . . . 40
Section 2.12 Discount Option . . . . . . . . . . . . . . . 41
Section 2.13 Additional Sellers and Account Originators . 41
ARTICLE III
Administration and Servicing of Receivables
Section 3.01 Acceptance of Appointment and Other Matters Relating to
the Servicer 42
Section 3.02 Servicing Compensation . 43
Section 3.03 Representations, Warranties and Covenants of the
Servicer 43
Section 3.04 Reports for the Trustee. . . 47
Section 3.05 Annual Certificate of Servicer. . . . . . . . 48
Section 3.06 Annual Servicing Report of Independent Public
Accountants; Copies of Reports Available
48
Section 3.07 Tax Treatment . . .49
Section 3.08 Notices to The Neiman Marcus Group, Inc . . . 49
Section 3.09 Adjustments . . . . . . . . . . . . . . . . . 49
Section 3.10 Reports to the Commission . . . . . . . . . . 50
ARTICLE IV
Rights of Certificateholders and Allocation andApplication of Collections
Section 4.01 Rights of Certificateholders. . . . . . . . . 51
Section 4.02 Establishment of Collection Account and Excess Funding
Account 51
Section 4.03 Collections and Allocations. 53
Section 4.04 Shared Principal Collections. . . . . . . . . 54
Section 4.05 Excess Finance Charge Collections . . . . . . 55
Section 4.06 Allocations During Funding Period . . . . . . 55
ARTICLE V
Distributions and Reports to Certificateholders
ARTICLE VI
The Certificates
Section 6.01 The Certificates. . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . .
56
Section 6.02 Authentication of Certificates. . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . 56
Section 6.03 New Issuances . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . .
. . . . . . . . . . . . . . . . . . . . . . . .
56
Section 6.04 Registration of Transfer and Exchange of Certificates
58
Section 6.05 Mutilated, Destroyed, Lost or Stolen
Certificates. . . . . . . . . . . . . . . . . 61
Section 6.06 Persons Deemed Owners . . . . . . . . . . . . 62
Section 6.07 Appointment of Paying Agent . . . . . . . . . 62
Section 6.08 Access to List of Registered Certificateholders' Names
and Addresses 63
Section 6.09 Authenticating Agent . . 63
Section 6.10 Book-Entry Certificates . . . . . . . . . . . 64
Section 6.11 Notices to Clearing Agency . . . . . . . . . 65
Section 6.12 Definitive Certificates . . . . . . . . . . . 65
Section 6.13 Global Certificate. . . . . . . . . . . . . . 66
Section 6.14 Uncertificated Classes. . . . . . . . . . . . 66
ARTICLE VII
Other Matters Relating to the Seller
Section 7.01 Liability of the Seller . . . . . . . . . . . 66
Section 7.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Seller
67
Section 7.03 Limitations on Liability of the Seller . . . 68
Section 7.04 Seller Indemnification of the Trust and the Trustee
68
ARTICLE VIII
Other Matters Relating to the Servicer
Section 8.01 Liability of the Servicer . . . . . . . . . . 69
Section 8.02 Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer
69
Section 8.03 Limitation on Liability of the Servicer and Others
70
Section 8.04 Servicer Indemnification of the Trust and the Trustee
70
Section 8.05 The Servicer Not To Resign . .71
Section 8.06 Access to Certain Documentation and Information
Regarding the Receivables
72
Section 8.07 Delegation of Duties . . 72
Section 8.08 Examination of Records . . . . . . . . . . . 72
ARTICLE IX
Pay Out Events
Section 9.01 Pay Out Events . . . . . . . . . . . . . . . 72
ARTICLE X
Servicer Defaults
Section 10.01 Servicer Defaults . . . . . . . . . . . . . . 73
Section 10.02 Trustee to Act; Appointment of Successor. . . 76
Section 10.03 Notification to Certificateholders. . . . . . 78
ARTICLE XI
The Trustee
Section 11.01 Duties of Trustee . . . . . . . . . . . . . . 78
Section 11.02 Certain Matters Affecting the Trustee . . . . 80
Section 11.03 Trustee Not Liable for Recitals in
Certificates. . . . . . . . . . . . . . . . . 81
Section 11.04 Trustee May Own Certificates. . . . . . . . . 81
Section 11.05 The Servicer To Pay Trustee's Fees and
Expenses. . . . . . . . . . . . . . . . . . . 81
Section 11.06 Eligibility Requirements for Trustee. . . . . 82
Section 11.07 Resignation or Removal of Trustee . . . . . . 82
Section 11.08 Successor Trustee . . . . . . . . . . . . . . 83
Section 11.09 Merger or Consolidation of Trustee. . . . . . 83
Section 11.10 Appointment of CoTrustee or Separate Trustee. 83
Section 11.11 Tax Return. . . . . . . . . . . . . . . . . . 85
Section 11.12 Trustee May Enforce Claims Without Possession of
Certificates 85
Section 11.13 Suits for Enforcement. . 85
Section 11.14 Rights of Certificateholders to Direct Trustee. . 85
Section 11.15 Representations and Warranties of Trustee . . 86
Section 11.16 Maintenance of Office or Agency . . . . . . . 86
Section 11.17 Confidentiality . . . . . . . . . . . . . . . 86
ARTICLE XII
Termination
Section 12.01 Termination of Trust. . . . . . . . . . . . . 87
Section 12.02 Final Distribution. . . . . . . . . . . . . . 87
Section 12.03 Seller's Termination Rights . . . . . . . . . 88
Section 12.04 Defeasance. . . . . . . . . . . . . . . . . . 89
ARTICLE XIII
Miscellaneous Provisions
Section 13.01 Amendment; Waiver of Past Defaults. . . . . . 90
Section 13.02 Protection of Right, Title and Interest to
Trust . . . . . . . . . . . . . . . . . . . . 92
Section 13.03 Limitation on Rights of Certificateholders. . 93
Section 13.04 GOVERNING LAW . . . . . . . . . . . . . . . . 94
Section 13.05 Notices, Payments . . . . . . . . . . . . . . 94
Section 13.06 Rule 144A Information . . . . . . . . . . . . 95
Section 13.07 Severability of Provisions. . . . . . . . . . 95
Section 13.08 Assignment. . . . . . . . . . . . . . . . . . 95
Section 13.09 Certificates Nonassessable and Fully Paid . . 95
Section 13.10 Further Assurances. . . . . . . . . . . . . . 95
Section 13.11 Nonpetition Covenant. . . . . . . . . . . . . 95
Section 13.12 No Waiver; Cumulative Remedies. . . . . . . . 96
Section 13.13 Counterparts. . . . . . . . . . . . . . . . . 96
Section 13.14 Third-Party Beneficiaries . . . . . . . . . . 96
Section 13.15 Actions by Certificateholders . . . . . . . . 96
Section 13.16 Merger and Integration. . . . . . . . . . . . 96
Section 13.17 Headings. . . . . . . . . . . . . . . . . . . 97
Section 13.18 No Proceedings. . . . . . . . . . . . . . . . 97
EXHIBITS
Exhibit A Form of Seller Certificate
Exhibit B Form of Assignment of Receivables in Additional Accounts
Exhibit C Form of Reassignment of Receivables in Removed Accounts
Exhibit D Form of Annual Servicer's Certificate
Exhibit E-1 Private Placement Legend
Exhibit E-2 Representation Letter
Exhibit E-3 ERISA Legend
Exhibit F Example of an Account Agreement
Exhibit G Reserved
Exhibit H-1 Form of Opinion of Counsel with respect to Amendments
Exhibit H-2 Form of Opinion of Counsel with Respect to Accounts
SCHEDULES
Schedule 1 List of Accounts [Deemed Incorporated]
POOLING AND SERVICING AGREEMENT, dated as of March 1 1995 and
amended and restated as of July 2, 2000, among NEIMAN MARCUS FUNDING
CORPORATION, a Delaware corporation, as Seller, THE NEIMAN MARCUS GROUP,
INC., a Delaware corporation, as Servicer, and THE BANK OF NEW YORK, a New
York banking corporation, as Trustee.
Neiman Marcus Funding Corporation, as Seller, and The Neiman
Marcus Group, Inc., as Servicer, originally entered into this Agreement
(the "Existing Agreement") with The Chase Manhattan Bank, N.A., as trustee,
as of March 1, 1995. Pursuant to Section 11.07 of the Existing Agreement,
the Chase Manhattan Bank, N.A. is resigning as trustee, and the Servicer is
appointing The Bank of New York as the replacement trustee.
Seller also wishes to amend certain terms of the Existing
Agreement, in accordance with the requirements of Section 13.01(a) thereof,
and the conditions specified in such Section have been satisfied.
In consideration of the mutual agreements herein contained,
each party agrees as follows for the benefit of the other parties, the
Certificateholders and any Series Enhancer to the extent provided herein
and in any Supplement:
ARTICLE I
Definitions
Definitions
. Whenever used in this Agreement, the following words and
phrases shall have the following meanings, and the definitions of such
terms are applicable to the singular as well as the plural forms of such
terms and to the masculine as well as to the feminine and neuter genders of
such terms.
"Account" shall mean each Initial Account and each Additional
Account, but shall exclude any Account all the Receivables in which are
either reassigned or assigned to the Seller or its designee or the Servicer
in accordance with the terms of this Agreement. The definition of Account
shall include each account into which an Account is transferred (a
"Transferred Account"); provided that (i) such transfer is made in
accordance with the Account Guidelines and (ii) such Transferred Account
can be traced or identified, by reference to or by way of the computer
files, microfiche lists or printed lists delivered to the Trustee pursuant
to Section 2.01 or 2.09(f), as an account into which an Account has been
transferred. The term "Account" shall be deemed to refer to an Additional
Account only from and after the Addition Date with respect thereto, and the
term "Account" shall be deemed to refer to any Removed Account only prior
to the Removal Date with respect thereto.
"Account Agreement" shall mean, with respect to an Account, the
agreements between the Account Originator that owns such Account and the
related Obligor, governing the terms and conditions of such Account, as
such agreements may be amended, modified or otherwise changed from time to
time and as distributed (including any amendments and revisions thereto) to
such Obligors. Examples of Account Agreements are attached as Exhibit F.
"Account Guidelines" shall mean, with respect to an Account,
the written policies and procedures of the Account Originator that owns
such Account relating to the operation of its consumer revolving or
installment lending business, including, without limitation, the written
policies and procedures for determining the creditworthiness of account
customers, the extension of credit to account customers and relating to the
maintenance of accounts and collection of receivables with respect thereto,
as such policies and procedures may be amended, modified, or otherwise
changed from time to time to conform with all Requirements of Law, the
failure to comply with which would have a material adverse effect on
interests hereunder of Investor Certificateholders.
"Account Originator" shall mean (i) The Neiman Marcus Group,
Inc., a Delaware corporation, (ii) Bergdorf Xxxxxxx Inc., a New York
corporation, (iii) any other originator of Accounts that, in either case,
enters into a Purchase Agreement with the Seller in accordance with Section
2.13 and (iv) any transferee of the respective Accounts of any of the
foregoing in accordance with the applicable Purchase Agreement and the
respective successors or assigns of the foregoing under the applicable
Purchase Agreement.
"Accumulation Period" shall mean, with respect to any Series,
the period, if any, specified as such in the related Supplement.
"Act" shall mean the Securities Act of 1933, as amended.
"Addition" shall mean the designation of additional Eligible
Accounts to be included as Accounts pursuant to Section 2.09(a), (b) or
(d) or of Participation Interests to be included as Trust Assets pursuant
to Section 2.09(a) or (b).
"Addition Cut-Off Date" shall mean (a) with respect to
Automatic Additional Accounts, the date of creation thereof and (b) with
respect to other Additional Accounts, the date as of which any Additional
Accounts or Participation Interests are designated for inclusion in the
Trust, as specified in the related Assignment.
"Addition Date" shall mean (a) with respect to Additional
Accounts, the date on which the Receivables in such Additional Accounts are
conveyed to the Trust pursuant to Section 2.09(a), (b) or (d) and (b) with
respect to Participation Interests, the date from and after which such
Participation Interests are to be included as Trust Assets pursuant to
Section 2.09(a) or (b). For the avoidance of doubt, the "Addition Date"
for each account identified in the Restatement Date Account Schedule that
was not designated as an Account prior to the Restatement Date is the
Restatement Date.
"Additional Account" shall mean each revolving credit card
account or other consumer revolving credit or installment account
established pursuant to an Account Agreement, which account is designated
pursuant to Section 2.09(a), (b) or (d) to be included as an Account and is
identified in a computer file, microfiche list or printed list delivered to
the Trustee by the Seller pursuant to Section 2.01 and 2.09(f); provided
that no such identification shall be required for Automatic Additional
Accounts created on or after July 2, 2000. For the avoidance of doubt,
each account identified in the Restatement Date Account Schedule that was
not designated as an Account prior to the Restatement Date is an Additional
Account.
"Adjusted Invested Amount" shall have, with respect to any
Series, the meaning specified in the related Supplement. If the Supplement
for a Series does not specify an "Adjusted Invested Amount," then the
Adjusted Invested Amount of that Series shall equal its Invested Amount.
"Affiliate" shall mean, with respect to any specified Person,
any other Person controlling or controlled by or under common control with
such specified Person. For the purposes of this definition, "control"
shall mean the power to direct the management and policies of a Person,
directly or indirectly, whether through the ownership of voting securities,
by contract or otherwise; and the terms "controlling" and "controlled" have
meaning correlative to the foregoing.
"Aggregate Addition Limit" shall mean the maximum number of
accounts that may be designated as Automatic Additional Accounts. The
Aggregate Addition Limit shall be deemed to be exceeded at any time when
the designation of one more Automatic Additional Account would cause:
(a) the number of accounts so designated during any fiscal quarter to
exceed 15% of the number of Accounts as of the first day of the fiscal year
during which such fiscal quarters fall; or (b) the number of accounts so
designated during any twelve-month period to exceed 20% of the number of
Accounts as of the first day of such twelve-month period. The Aggregate
Addition Limit shall also be deemed to be exceeded from and after the first
Determination Date in any fiscal quarter if: (x) the aggregate balance of
Receivables in Accounts that were designated as Automatic Additional
Accounts during the preceding fiscal quarter is greater than 15% of the
aggregate balance of Receivables as of the beginning of the fiscal year
during which such fiscal quarter falls; or (y) the aggregate balance of
Receivables in Accounts that were designated as Automatic Additional
Accounts during the preceding four consecutive fiscal quarters is greater
than 20% of the aggregate balance of Receivables as of the beginning of the
first of such four preceding fiscal quarters. For purposes of this
definition, references to fiscal quarters and fiscal years refer to fiscal
quarters and fiscal years of The Neiman Marcus Group, Inc., and all
revolving credit card accounts or other consumer revolving credit or
installment accounts established by Bergdorf Xxxxxxx Inc. and in existence
during the four consecutive fiscal quarters ending in July 2000 shall be
deemed to have been Accounts.
"Agreement" shall mean this Pooling and Servicing Agreement and
all amendments hereof and supplements hereto, including, with respect to
any Series or Class, the related Supplement.
"Amortization Period" shall mean, with respect to any Series or
any Class within a Series, a period following the Revolving Period, that
shall be the controlled amortization period, the principal amortization
period, the rapid amortization period, the optional amortization period,
the limited amortization period or other amortization period, in each case
as defined with respect to such Series in the related Supplement.
"Applicants" shall have the meaning specified in Section 6.08.
"Assignment" shall have the meaning specified in Section
2.09(f).
"Authorized Newspaper" shall mean any newspaper or newspapers
of general circulation in the Borough of Manhattan, The City of New York
printed in the English language (and, with respect to any Series or Class,
if and so long as the Investor Certificates of such Series or Class are
listed on the Luxembourg Stock Exchange and such exchange shall so require,
in Luxembourg, printed in any language satisfying the requirements of such
exchange) and customarily published on each business day at such place,
whether or not published on Saturdays, Sundays or holidays.
"Automatic Addition Suspension Date" shall have the meaning
specified in Section 2.09(d).
"Automatic Addition Termination Date" shall have the meaning
specified in Section 2.09(d).
"Automatic Additional Account" shall have the meaning specified
in Section 2.09(d).
"Base Rate" shall have the meaning, with respect to any Series,
specified in the related Supplement.
"Bearer Certificate" shall have the meaning specified in
Section 6.01.
"Benefit Plan" shall have the meaning specified in Section
6.04(c).
"Book-Entry Certificates" shall mean beneficial interests in
the Investor Certificates, ownership and transfers of which shall be made
through book entries by a Clearing Agency as described in Section 6.10.
"Business Day" shall mean any day other than (a) a Saturday or
Sunday, (b) any other day on which national banking associations or state
banking institutions in New York, New York, Dallas, Texas or Boston,
Massachusetts are authorized or obligated by law, executive order or
governmental decree to be closed or (c) for purposes of any particular
Series, any other day specified in the related Supplement.
"Certificate" shall mean any one of the Investor Certificates
or the Seller Certificate.
"Certificate Owner" shall mean, with respect to a Book-Entry
Certificate, the Person who is the owner of such Book-Entry Certificate, as
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing Agency (directly or as an
indirect participant, in accordance with the rules of such Clearing
Agency).
"Certificate Rate" shall mean, with respect to any Series or
Class, the certificate rate specified therefor in the related Supplement.
"Certificate Register" shall mean the register maintained
pursuant to Section 6.04, providing for the registration of the Registered
Certificates and the Seller Certificate and transfers and exchanges
thereof.
"Certificateholder" or "Holder" shall mean an Investor
Certificateholder or a Person in whose name the Seller Certificate is
registered.
"Certificateholders' Interest" shall have the meaning specified
in Section 4.01.
"Class" shall mean, with respect to any Series, any one of the
classes of Investor Certificates of that Series.
"Clearing Agency" shall mean an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended.
"Clearing Agency Participant" shall mean a broker, dealer,
bank, other financial institution or other Person for whom from time to
time a Clearing Agency effects book-entry transfers and pledges of
securities deposited with the Clearing Agency.
"Closing Date" shall mean, with respect to any Series, the
closing date specified in the related Supplement.
"Code" shall mean the Internal Revenue Code of 1986, as amended
from time to time.
"Collection Account" shall have the meaning specified in
Section 4.02.
"Collections" shall mean all payments (including Recoveries of
Principal Receivables or Finance Charge Receivables) received by the
Servicer with respect to the Receivables, in the form of cash, checks (to
the extent collected), wire transfers or other form of payment in
accordance with the Account Agreement in effect from time to time on any
Receivables. If so specified in any Supplement, Collections shall also
include any payments received by the Servicer with respect to Participation
Interests.
"Commission" shall mean the Securities and Exchange Commission.
"Controlled Distribution Amount", with respect to any Series,
shall have the meaning specified in the related Supplement.
"Corporate Trust Office" shall have the meaning specified in
Section 11.16.
"Coupon" shall have the meaning specified in Section 6.01.
"Daily Report" shall have the meaning specified in Section
3.04(c).
"Date of Processing" shall mean, with respect to any
transaction, the Business Day such transaction is first recorded under the
Servicer's (or, in the case of an Account Originator, the Account
Originator's) customary and usual servicing practices on the Servicer's
(or, in the case of an Account Originator, the Account Originator's)
computer file of consumer revolving credit card accounts and other consumer
revolving or installment credit accounts.
"Debtor Relief Laws" shall mean the Bankruptcy Code of the
United States of America and 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.
"Defaulted Amount" shall mean, with respect to any Monthly
Period, an amount (which shall not be less than zero) equal to (a) the
amount of Principal Receivables that became Defaulted Receivables in such
Monthly Period, minus (b) the sum of (i) the amount of any Defaulted
Receivables of which the Seller or the Servicer became obligated to accept
reassignment or assignment in accordance with the terms of this Agreement
during such Monthly Period and (ii) the amount of Recoveries received in
such Monthly Period with respect to Finance Charge Receivables and
Principal Receivables previously charged off as uncollectible; provided,
however, that, if an Insolvency Event occurs with respect to the Seller,
the amount of such Defaulted Receivables that are subject to reassignment
to the Seller in accordance with the terms of this Agreement shall not be
added to the sum so subtracted and, if any of the events described in
Section 10.01(d) occur with respect to the Servicer, the amount of such
Defaulted Receivables that are subject to reassignment or assignment to the
Servicer in accordance with the terms of this Agreement shall not be added
to the sum so subtracted.
"Defaulted Receivable" shall mean, with respect to any Monthly
Period, all Principal Receivables in any Account that are charged off as
uncollectible in such Monthly Period in accordance with the Account
Guidelines and the Servicer's customary and usual servicing procedures for
servicing revolving credit card and installment receivables comparable to
the Receivables. A Principal Receivable in any Account shall become a
Defaulted Receivable on the day on which such Principal Receivable is
recorded as charged off on the Servicer's computer master file of consumer
credit card and installment accounts in accordance with the Account
Guidelines.
"Defeasance" shall have the meaning specified in Section 12.04.
"Defeased Series" shall have the meaning specified in Section
12.04.
"Definitive Certificates" shall have the meaning specified in
Section 6.10.
"Definitive Euro-Certificates" shall have the meaning specified
in Section 6.13.
"Deposit Date" shall mean each day on which the Servicer
deposits Collections in the Collection Account.
"Depositaries" shall mean the Person specified in the
applicable Supplement, in its capacity as depositary for the respective
accounts of any Clearing Agency or, with respect to Global Certificates,
any foreign clearing agencies set forth in the related Supplement.
"Depository Agreement" shall mean, with respect to any Series
or Class, the agreement among the Seller, the Trustee and the applicable
Clearing Agency.
"Determination Date" shall mean the third Business Day prior to
each Distribution Date.
"Discount Option Receivables" shall have the meaning specified
in Section 2.12.
"Discount Option Receivables Collections" shall mean on any
Date of Processing on and after the date on which the Seller's exercise of
its discount option pursuant to Section 2.12 takes effect, the product of
(a) a fraction the numerator of which is the amount of the Discount Option
Receivables and the denominator of which is the amount of all of the
Principal Receivables (including Discount Option Receivables) at the end of
the prior Monthly Period and (b) Collections of Principal Receivables that
arise in the Accounts on such day on or after the date such option is
exercised that would otherwise be Principal Receivables.
"Discount Percentage" shall have the meaning specified in
Section 2.12.
"Distribution Date" shall mean, unless otherwise specified in
the Supplement for the related Series, the 15th day of each calendar month
during the term hereof, or, if such 15th day is not a Business Day, the
next succeeding Business Day.
"Document Delivery Date" shall mean (a) the first Closing Date
in the case of Initial Accounts, (b) July 8, 2000 in the case of all
Accounts designated to the Trust on or prior to July 2, 2000 which were not
identified on Schedule 1 (as supplemented) prior to that date, (c) the
Addition Date in the case of Additional Accounts (other than Automatic
Additional Accounts) and (d) the Removal Date in the case of Removed
Accounts.
"Eligible Account" shall mean a revolving credit card account
or other consumer revolving credit or installment account owned by an
Account Originator that as of the Trust Cut-Off Date with respect to an
Initial Account or as of the related Addition Cut-Off Date with respect to
an Additional Account meets the requirement of either clauses (i) or
(ii) below: (i) (a) is in existence and maintained by the Account
Originator or an Affiliate thereof; (b) is payable in United States
dollars; (c) except as provided below, has not been identified as an
account the credit cards with respect to which have been reported to the
applicable Account Originator as having been lost or stolen; (d) has not
been, and does not have any Receivables which have been, sold, pledged,
assigned or otherwise conveyed to any person (except pursuant to this
Agreement), unless any such pledge or assignment is released on or before
the initial Closing Date or the Addition Date, as applicable; (e) except as
provided below, does not have any Receivables that are Defaulted
Receivables; (f) except as provided below, does not have any Receivables
that have been identified by the applicable Account Originator or the
relevant Obligor as having been incurred as a result of fraudulent use of
any related credit card; and (g) has an Obligor who has provided as his or
her most recent billing address, an address located in the United States or
its territories or possessions or a United States military address;
provided, however, that as of any date of determination, up to 3% of the
Accounts (calculated by number of Accounts) may have Obligors who have
provided addresses outside of such jurisdictions or (ii) with respect to
Additional Accounts, the addition of such Accounts shall have satisfied the
Rating Agency Condition. Eligible Accounts may include accounts, the
receivables of which have been written off, or with respect to which the
applicable Account Originator believes the related Obligor is bankrupt, or
as to which certain receivables have been identified by the Obligor as
having been incurred as a result of fraudulent use of any credit cards, or
as to which any credit cards have been reported to the applicable Account
Originator as lost or stolen; provided that (a) the balance of all
receivables included in such accounts is reflected on the books and records
of the applicable Account Originator (and is treated for purposes of this
Agreement) as "zero", and (b) charging privileges with respect to all such
accounts have been canceled in accordance with the Account Guidelines of
the applicable Account Originator and will not be reinstated by the
applicable Account Originator or the Servicer.
"Eligible Deposit Account" shall mean either (a) a segregated
account with an Eligible Institution or (b) a segregated trust account with
the corporate trust department of a depository institution organized under
the laws of the United States or any one of the states thereof, including
the District of Columbia (or any domestic branch of a foreign bank), and
acting as a trustee for funds deposited in such account, so long as any of
the securities of such depository institution shall have a credit rating
from each Rating Agency in one of its generic credit rating categories that
signifies investment grade.
"Eligible Institution" shall mean (a) a depository institution
(which may be the Trustee or an affiliate) organized under the laws of the
United States or any one of the states thereof that at all times (i) has
either (x) a long-term unsecured debt rating of A2 or better by Moody's or
(y) a certificate of deposit rating of P-1 by Moody's, (ii) has either
(x) a long-term unsecured debt rating of AAA by Standard & Poor's or (y) a
certificate of deposit rating of A-1+ by Standard & Poor's and (iii) is a
member of the FDIC or (b) any other institution that is acceptable to
Moody's and Standard & Poor's.
"Eligible Investments" shall mean book-entry securities,
negotiable instruments or securities represented by instruments in bearer
or registered form that evidence:
(a) direct obligations of, and obligations fully
guaranteed as to timely payment of principal and interest by, the
United States of America;
(b) demand deposits, time deposits or certificates of
deposit (having original maturities of no more than 365 days) 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) and subject to supervision and
examination by federal or state banking or depository institution
authorities; provided that at the time of the Trust's investment or
contractual commitment to invest therein, the shortterm debt rating
of such depository institution or trust company shall be in the
highest investment category of each Rating Agency;
(c) commercial paper or other shortterm obligations
having, at the time of the Trust's investment or contractual
commitment to invest therein, a rating from each Rating Agency in its
highest investment category;
(d) demand deposits, time deposits and certificates of
deposit that are fully insured by the FDIC, with a Person the
commercial paper of which has a credit rating from each Rating Agency
in its highest investment category;
(e) notes or bankers' acceptances (having original
maturities of no more than 365 days) issued by any depository
institution or trust company referred to in (b) above;
(f) investments in money market funds (including funds
of the Trustee or its affiliates as well as funds for which the
Trustee and its affiliates may receive compensation) rated in the
highest investment category by each Rating Agency or otherwise
approved in writing by each Rating Agency;
(g) time deposits, other than as referred to in clause
(d) above, with a Person the commercial paper of which has a credit
rating from each Rating Agency in its highest investment category; or
(h) any other investments approved in writing by each
Rating Agency.
"Eligible Receivable" shall mean each Receivable:
that has arisen under an Eligible Account;
(a) that was created in compliance with the Account
Guidelines and all Requirements of Law applicable to the applicable
Account Originator, the failure to comply with which would have a
material adverse effect on Investor Certificateholders, and pursuant
to an Account Agreement that complies with all Requirements of Law
applicable to the applicable Account Originator, the failure to
comply with which would have a material adverse effect on Investor
Certificateholders;
(b) for which all consents, licenses, approvals or
authorizations of, or registrations with, any Governmental Authority
required to be obtained or given by the applicable Account Originator
in connection with the creation of such Receivable or the execution
and delivery by the applicable Account Originator, and performance by
the applicable Account Originator of its obligations under the
related Account Agreement, have been duly obtained or given and are
in full force and effect as of such date of creation of such
Receivable, if, and to the extent that the failure to so obtain or
give any such consent, license, approval, authorization or
registration would have a material adverse effect on the Investor
Certificateholders;
(c) as to which, at the time of its transfer to the
Trust, the Seller or the Trust will have good and marketable title
free and clear of all Liens (other than any Lien for taxes if such
taxes are not then due and payable or if the Seller is then
contesting the validity thereof in good faith by appropriate
proceedings and has set aside on its books adequate reserves with
respect thereto);
(d) that has been the subject of a valid transfer and
assignment from the Seller to the Trust of all the Seller's right,
title and interest therein;
(e) that at and after the time of transfer to the Trust
is the legal, valid and binding payment obligation of the Obligor
thereon, legally enforceable against such Obligor in accordance with
its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar
laws, now or hereafter in effect, affecting the enforcement of
creditors' rights in general and except as such enforceability may be
limited by general principles of equity (whether considered in a suit
at law or in equity);
(f) that constitutes either an "account" a "general
intangible" or "chattel paper" under and as defined in Article 9 of
the UCC;
(g) that, at the time of its transfer to the Trust, has
not been waived or modified except as permitted in accordance with
Section 3.03(h);
(h) that, at the time of its transfer to the Trust, is
not subject to any right of rescission, setoff, counterclaim or any
other defense of the Obligor (including the defense of usury), other
than defenses arising out of Debtor Relief Laws or other similar laws
affecting the enforcement of creditors' rights in general and except
as such enforceability may be limited by general principles of equity
(whether considered in a suit at law or equity) or as to which the
Servicer is required by Section 3.09 to make an adjustment;
(i) as to which, at the time of its transfer to the
Trust, the Seller has satisfied all obligations to be fulfilled at
the time it is transferred to the Trust; and
(j) as to which, at the time of its transfer to the
Trust, the Seller has not taken any action that, or failed to take
any action the omission of which, would, at the time of its transfer
to the Trust, impair the rights of the Trust or the
Certificateholders therein.
"Eligible Servicer" shall mean the Trustee, a wholly-owned
subsidiary of the Trustee or an entity that, at the time of its appointment
as Servicer, (a) is servicing a portfolio of consumer revolving credit card
accounts or other consumer revolving credit or installment accounts, (b) is
legally qualified and has the capacity to service the Accounts, (c) is
qualified (or licensed) to use the software that is then being used to
service the Accounts or obtains the right to use, or has its own, software
that is adequate to perform its duties under this Agreement, (d) has, in
the reasonable judgment of the Trustee, the ability to professionally and
competently service a portfolio of similar accounts and (e) has a net worth
of at least $50,000,000 as of the end of its most recent fiscal quarter.
"Enhancement Agreement" shall mean any agreement, instrument or
document governing the terms of any Series Enhancement or pursuant to which
any Series Enhancement is issued or outstanding.
"Enhancement Invested Amount", with respect to any Series,
shall have the meaning specified in the related Supplement.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended.
"Excess Finance Charge Collections" shall have the meaning
specified in Section 4.05.
"Excess Funding Account" shall have the meaning specified in
Section 4.02.
"Excluded Series" shall mean any Series designated as such in
the relevant Supplement.
"Existing Agreement" shall have the meaning specified in the
Recitals.
"FDIC" shall mean the Federal Deposit Insurance Corporation or
any successor.
"Finance Charge Receivables" shall mean, with respect to any
Monthly Period, the sum of (i) all amounts billed to the Obligors on any
Account at the beginning of such Monthly Period in respect of Periodic
Finance Charges and late fees and (ii) Discount Option Receivables.
"Finance Charge Shortfalls" shall have the meaning specified in
Section 4.05.
"Floating Allocation Percentage" shall mean, with respect to
any Series, the floating allocation percentage specified in the related
Supplement.
"Funding Period" shall have the meaning specified in Section
4.06.
"Global Certificate" shall have the meaning specified in
Section 6.13.
"Governmental Authority" shall mean the United States of
America, any state or other political subdivision thereof and any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"Group" shall mean, with respect to any Series, the group of
Series, if any, in which the related Supplement specifies such Series is to
be included.
"Ineligible Receivables" shall have the meaning specified in
Section 2.05(a).
"Initial Account" shall mean each revolving credit card account
or other consumer revolving or installment credit account established
pursuant to an Account Agreement between The Neiman Marcus Group, Inc., as
the initial Account Originator and any Person, and identified by account
number and by the Receivable balance in a computer file, microfiche list or
printed list delivered to the Trustee by the Seller on or prior to the
first Closing Date pursuant to Section 2.01.
"Insolvency Event" shall have the meaning specified in Section
9.01(a).
"Insurance Proceeds" shall mean any amounts recovered by the
Servicer pursuant to any credit insurance policies covering any Obligor
with respect to Receivables under such Obligor's Account.
"Interest Funding Account" shall mean, with respect to any
Series, the account, if any, specified as such in the related Supplement.
"Invested Amount" shall have, with respect to any Series, the
meaning specified in the related Supplement.
"Investment Company Act" shall mean the Investment Company Act
of 1940, as amended.
"Investor Certificateholder" shall mean the Person in whose
name a Registered Certificate is registered in the Certificate Register or
the holder of any Bearer Certificate (or the Global Certificate, as the
case may be) or Coupon.
"Investor Certificates" shall mean any one of the certificates
(including the Bearer Certificates, the Registered Certificates or any
Global Certificate) executed by the Seller and authenticated by or on
behalf of the Trustee, substantially in the form attached to the related
Supplement, other than the Seller Certificate.
"Investor Percentage" shall have, for any Series, with respect
to Principal Receivables, Finance Charge Receivables and Receivables in
Defaulted Accounts, the meaning specified in the related Supplement.
"Late Fees" shall mean the fees specified in the Account
Agreement applicable to each Account for late fees with respect to such
Account.
"Lien" shall mean any mortgage, deed of trust, pledge,
hypothecation, assignment, participation or equity interest, deposit
arrangement, encumbrance, lien (statutory or other), preference, priority
or other security agreement or preferential arrangement of any kind or
nature whatsoever, including 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 (other than any such financing statement filed for
informational purposes only) or comparable law of any jurisdiction to
evidence any of the foregoing, excluding any lien or filing pursuant to
this Agreement; provided, however, that any assignment or transfer pursuant
to Section 6.03(c) or (d) or Section 7.02 shall not be deemed to constitute
a Lien.
"Monthly Period" shall mean each calendar month, unless
otherwise defined in any Supplement.
"Monthly Servicing Fee" shall have the meaning specified in the
related Supplement.
"Moody's" shall mean Xxxxx'x Investors Service, Inc., or its
successor.
"Notices" shall have the meaning specified in Section 13.05(a).
"Obligor" shall mean, with respect to any Account, the Person
or Persons obligated to make payments with respect to such Account,
including any guarantor thereof.
"Officer's Certificate" shall mean, unless otherwise specified
in this Agreement, a certificate delivered to the Trustee signed by the
Chairman of the Board, President, any Vice President or the Treasurer of
the Seller or the Servicer, as the case may be.
"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 which opinion shall be reasonably acceptable to the Trustee.
"Participation Interests" shall have the meaning specified in
Section 2.09(a).
"Paying Agent" shall mean any paying agent and copaying agent
appointed pursuant to Section 6.07.
"Pay Out Event" shall mean, with respect to any Series, each
event specified in Section 9.01 and each additional event, if any,
specified in the relevant Supplement as a Pay Out Event with respect to
such Series.
"Periodic Finance Charges" shall have the meaning specified in
the Account Agreement applicable to each Account for finance charges (due
to periodic rate) or any similar term.
"Person" shall mean any legal person, including any individual,
corporation, partnership, joint venture, association, jointstock company,
trust, unincorporated organization, governmental entity or other entity of
similar nature.
"Portfolio Yield" shall have the meaning, with respect to any
Series, specified in the related Supplement.
"Pre-Funding Account" shall have the meaning specified in
Section 4.06.
"Principal Allocation Percentage" shall mean, with respect to
any Series, the principal allocation percentage specified in the related
Supplement.
"Principal Funding Account" shall mean, with respect to any
Series, the account, if any, specified as such in the related Supplement.
"Principal Receivable" shall mean all Receivables that are not
Finance Charge Receivables. In calculating the aggregate amount of
Principal Receivables on any day, the amount of Principal Receivables shall
not include Defaulted Receivables and shall be reduced by the aggregate
amount of credit balances in the Accounts on such day. Any Receivables
that the Seller is unable to transfer as provided in Section 2.11 shall not
be included in calculating the aggregate amount of Principal Receivables,
except to the extent so provided in Section 2.11.
"Principal Sharing Series" shall mean a Series that, pursuant
to the Supplement therefor, is entitled to receive Shared Principal
Collections.
"Principal Shortfalls" shall have the meaning specified in
Section 4.04.
"Principal Terms" shall mean, with respect to any Series,
(i) the name or designation; (ii) the initial principal amount (or method
for calculating such amount) and its invested amount in the Trust;
(iii) the Certificate Rate (or method for the determination thereof);
(iv) the payment date or dates and the date or dates from which interest
shall accrue; (v) the method for allocating Collections to
Certificateholders of such Series; (vi) the designation of any Series
Accounts and the terms governing the operation of any such Series Accounts;
(vii) the method of calculating the servicing fee with respect thereto;
(viii) the provider, if any, and the terms of any form of Series
Enhancement with respect thereto; (ix) the terms on which the Investor
Certificates of such Series may be exchanged for Investor Certificates of
another Series, repurchased by the Seller or any Affiliate of the Seller or
remarketed to other investors; (x) the Series Termination Date; (xi) the
number of Classes of Investor Certificates of such Series and, if such
Series consists of more than one Class, the rights and priorities of each
such Class; (xii) the extent to which the Investor Certificates of such
Series will be issuable in temporary or permanent global form (and, in such
case, the depositary for such Global Certificate or Certificates, the terms
and conditions, if any, upon which such Global Certificates may be
exchanged, in whole or in part, for Definitive Certificates, and the manner
in which any interest payable on a temporary or Global Certificate will be
paid); (xiii) whether the Investor Certificates of such Series may be
issued as Bearer Certificates and any limitation imposed thereon; (xiv) the
priority of such Series with respect to any other Series; (xv) whether or
not such Series is a Principal Sharing Series; (xvi) the Group, if any, to
which such Series belongs; and (xvii) any other terms of, or with respect
to, such Series.
"Purchase Agreement" shall mean (i) the Receivables Purchase
Agreement, dated as of March 1, 1995 and amended and restated as of July 2,
2000, between The Neiman Marcus Group, Inc. and Neiman Marcus Funding
Corporation, (ii) the Receivables Purchase Agreement, dated as of July 2,
2000, between Bergdorf Xxxxxxx Inc. and Neiman Marcus Funding Corporation
and (iii) any other receivables purchase agreement entered into between
another Account Originator and the Seller in accordance with Section 2.13,
substantially in the form of the Receivables Purchase Agreement referred to
in clause (ii) above.
"Rating Agency" shall mean, with respect to any outstanding
Series or Class, each statistical rating agency selected by the Seller to
rate the Investor Certificates of such Series or Class.
"Rating Agency Condition" shall mean, with respect to any
action, that each Rating Agency shall have notified the Seller, the
Servicer and the Trustee in writing that such action will not result in a
reduction or withdrawal of the rating of any outstanding Series or Class
with respect to which it is a Rating Agency.
"Reassignment" shall have the meaning specified in Section
2.10.
"Receivable" shall mean any amount owing by the Obligor under
an Account from time to time, including amounts owing for purchases of
goods and services, and amounts payable for Finance Charge Receivables and
excluding annual fees and non-sufficient fund fees on the Accounts. A
Receivable shall be deemed to have been created at the end of the day on
the Date of Processing of such Receivable. Receivables that become
Defaulted Receivables shall not be shown on the Servicer's records as
amounts payable (and shall cease to be included as Receivables) on the day
on which they become Defaulted Receivables.
"Record Date" shall mean, with respect to any Distribution
Date, the last Business Day of the preceding calendar month, except as
otherwise provided with respect to a Series in the related Supplement.
"Recoveries" shall mean all amounts, including Insurance
Proceeds, received by the Servicer with respect to Receivables that have
previously become Defaulted Receivables.
"Registered Certificateholder" shall mean the Holder of a
Registered Certificate.
"Registered Certificates" shall have the meaning specified in
Section 6.01.
"Removal Date" shall have the meaning specified in Section
2.10(a).
"Removal Notice Date" shall have the meaning specified in
Section 2.10(a).
"Removed Accounts" shall have the meaning specified in Section
2.10.
"Required Designation Date" shall have the meaning specified in
Section 2.09(a).
"Required Principal Balance" shall mean, as of any date of
determination, the sum of the numerators used at such date to calculate the
Investor Percentage with respect to Principal Receivables for all Series
outstanding on such date.
"Required Retained Interest" shall mean the product of the
Required Retained Percentage and the sum of the outstanding principal
amounts of all classes of all Series.
"Required Retained Percentage" shall mean the highest Required
Retained Percentage specified in any Supplement or such lower amount as is
established by the Seller and as to which a Tax Opinion has been delivered.
"Required Seller's Interest" shall mean, as of any date of
determination, the product of (i) the aggregate Principal Receivables and
(ii) the Required Seller's Percentage; provided that if such percentage is
zero, any amount by which the Seller's Interest is below zero will
constitute the amount by which the Seller's Interest will be less than the
Required Seller's Interest.
"Required Seller's Percentage" shall mean, as of any date of
determination, the weighted average of the Required Seller's Percentages,
based on the Invested Amounts of each Series outstanding as of such date,
specified in the Supplements for all outstanding Series.
"Requirements of Law" with respect to any Person shall mean the
certificate of incorporation or articles of association and bylaws or other
organizational or governing documents of such Person, and any law, treaty,
rule or regulation, or determination of an arbitrator or Governmental
Authority, in each case applicable to or binding upon such Person or to
which such Person is subject, whether Federal, state or local.
"Responsible Officer" shall mean any officer within the
Corporate Trust Department (or any successor group of the Trustee),
including any vice president, assistant vice president, assistant secretary
or any other officer or assistant officer of the Trustee customarily
performing functions similar to those performed by the persons who at the
time shall be such officers, respectively, or to whom any corporate trust
matter is referred at the Trustee's Corporate Trust Office because of such
officer's knowledge of and familiarity with the particular subject.
"Restart Date" shall have the meaning specified in Section
2.09(d).
"Restatement Date" shall mean July 2, 2000.
"Restatement Date Account Schedule" shall mean a computer file,
microfiche list or printed list containing a true and complete list of all
Accounts as of the beginning of the day on the Restatement Date, which is
required to be delivered to the Trustee no later than July 8, 2000.
"Retained Interest" shall mean, on any date of determination,
the sum of the Seller's Interest (excluding the interest represented by any
Supplemental Certificate) and the Invested Amount represented by any Seller
Retained Certificate.
"Retained Percentage" shall mean, on any date of determination,
the percentage equivalent of a fraction the numerator of which is the
Retained Interest and the denominator of which is the aggregate amount of
Principal Receivables at the end of the day immediately prior to such date
of determination plus all amounts on deposit in the Excess Funding Account
(but not including investment earnings on such amounts).
"Revolving Period" shall mean, with respect to any Series, the
period specified as such in the related Supplement.
"Rule 144A" shall mean Rule 144A under the Act, as such Rule
may be amended from time to time.
"Scheduled Amortization Period" shall mean, with respect to any
Series, the period, if any, specified as such in the related Supplement.
"Seller" shall mean Neiman Marcus Funding Corporation, a
Delaware corporation, or its successors or assigns under this Agreement and
additional sellers, if any, designated in accordance with Sections 2.13 or
6.03(d).
"Seller Certificate" shall mean the certificate executed by the
Seller and authenticated by or on behalf of the Trustee, substantially in
the form of Exhibit A.
"Seller Retained Certificates" shall mean Investor Certificates
of any Series that the Seller retained pursuant to the terms of any
Supplement.
"Seller Retained Class" shall mean any Class of Investor
Certificates of any Series that the Seller retained pursuant to the terms
of any Supplement.
"Seller's Interest" shall have the meaning specified in Section
4.01. For purposes of all calculations under this Agreement, the amount of
the Seller's Interest at any time shall equal the result of (i) the sum of
(a) the aggregate Principal Receivables and (b) the amount on deposit in
the Excess Funding Account minus (ii) the sum of the Adjusted Invested
Amounts of all outstanding Series.
"Seller's Percentage" shall mean, with respect to Finance
Charge Receivables and Defaulted Receivables, 100% less the sum of the
Floating Allocation Percentages with respect to all outstanding Series and
with respect to Principal Receivables, 100% less the sum of the Principal
Allocation Percentages with respect to all outstanding Series.
"Series" shall mean any series of Investor Certificates
established pursuant to a Supplement.
"Series Account" shall mean any deposit, trust, escrow or
similar account maintained for the benefit of the Investor
Certificateholders of any Series or Class, as specified in any Supplement.
"Series Allocation Percentage" shall mean with respect to any
Series, on any date of determination, the percentage equivalent of a
fraction the numerator of which is the Series Invested Amount of such
Series and the denominator of which is the sum of the Series Invested
Amounts of all Series then outstanding.
"Series Enhancement" shall mean the rights and benefits
provided to the Investor Certificateholder of any Series or Class pursuant
to any letter of credit, surety bond, cash collateral account, enhancement
invested amount, spread account, guaranteed rate agreement, maturity
liquidity facility, tax protection agreement, interest rate swap agreement,
interest rate cap agreement or other similar arrangement. The
subordination of any Class to another Class shall be deemed to be a Series
Enhancement.
"Series Enhancer" shall mean the Person or Persons providing
any Series Enhancement, other than the Investor Certificateholders of any
Class that is subordinated to another Class.
"Series Invested Amount" shall have, with respect to any
Series, the meaning specified in the related Supplement.
"Series Issuance Date" shall mean, with respect to any Series,
the date on which the Investor Certificates of such Series are to be
originally issued in accordance with Section 6.03 and the related
Supplement.
"Series Termination Date" shall mean, with respect to any
Series, the termination date specified in the related Supplement.
"Service Transfer" shall have the meaning specified in Section
10.01.
"Servicer" shall mean The Neiman Marcus Group, Inc., in its
capacity as Servicer pursuant to this Agreement, and, after any Service
Transfer, the Successor Servicer.
"Servicer Default" shall have the meaning specified in Section
10.01.
"Servicing Fee" shall mean, with respect to any Series, the
servicing fee specified in Section 3.02.
"Servicing Fee Rates" shall mean, with respect to any Series,
the Servicing Fee Rate specified in the related Supplement.
"Servicing Officer" shall mean any officer of the Servicer
involved in, or responsible for, the administration and servicing of the
Receivables whose name appears on a list of servicing officers furnished to
the Trustee by the Servicer, as such list may from time to time be amended.
"Shared Principal Collections" shall have the meaning specified
in Section 4.04.
"Standard & Poor's" shall mean Standard & Poor's Ratings
Group, a division of McGraw Hill Corporation or its successor.
"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
Section 6.03, and all amendments thereof and supplements thereto.
"Supplemental Certificate" shall have the meaning specified in
Section 6.03(c).
"Tax Opinion" shall mean, with respect to any action, an
Opinion of Counsel to the effect that, for Federal income tax purposes,
(a) such action will not adversely affect the tax characterization as debt
of Investor Certificates of any outstanding Series or Class that were
characterized as debt at the time of their issuance, (b) following such
action the Trust will not be deemed to be an association (or publicly
traded partnership) taxable as a corporation and (c) such action will not
cause or constitute an event in which gain or loss would be recognized by
any Investor Certificateholders.
"Termination Notice" shall have the meaning specified in
Section 10.01.
"Transfer Agent and Registrar" shall have the meaning specified
in Section 6.04.
"Transfer Date" shall mean the Business Day immediately
preceding each Distribution Date.
"Transfer Restriction Event" shall have the meaning specified
in Section 2.11.
"Transferred Account" shall have the meaning set forth in the
definition of "Account".
"Trust" shall mean the Neiman Marcus Group Credit Card Master
Trust created by this Agreement.
"Trust Assets" shall have the meaning specified in Section
2.01.
"Trust Cut-Off Date" shall mean March 1, 1995.
"Trustee" shall mean The Bank of New York in its capacity as
trustee on behalf of the Trust, or its successor in interest, or any
successor trustee appointed as herein provided.
"UCC" shall mean the Uniform Commercial Code, as amended from
time to time, as in effect in the State of New York and in any other State
where the filing of a financing statement is required to perfect the
Seller's or the Trust's interest in the Receivables and the proceeds
thereof or in any other specified jurisdiction.
"United States" shall mean the United States of America
(including the States and the District of Columbia), its territories, its
possessions and other areas subject to its jurisdiction.
"U.S. person" or "United States person" shall mean a citizen or
resident of the United States, a corporation, partnership or other entity
created or organized in or under the laws of the United States, or an
estate or trust the income of which is subject to United State Federal
income taxation regardless of its source.
"Variable Funding Certificates" shall have the meaning
specified in any Variable Funding Supplement.
"Variable Funding Supplement" shall mean a Supplement executed
in connection with the issuance of, and otherwise specifying the terms
governing the issuance of, Variable Funding Certificates provided for
therein.
Other Definitional Provisions
(a) . (a) With respect to any Series, all terms used
herein and not otherwise defined herein shall have meanings ascribed
to them in the related Supplement.
(b) 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.
(c) As used in this Agreement and in any certificate or
other document made or delivered pursuant hereto or thereto,
accounting terms not defined in this Agreement or in any such
certificate or other document, and accounting terms partly defined in
this Agreement or in any such certificate or other document to the
extent not defined, shall have the respective meanings given to them
under generally accepted accounting principles. To the extent that
the definitions of accounting terms in this Agreement or in any such
certificate or other document are inconsistent with the meanings of
such terms under generally accepted accounting principles, the
definitions contained in this Agreement or in any such certificate or
other document shall control.
(d) The agreements, representations and warranties of
Neiman Marcus Funding Corporation and The Neiman Marcus Group, Inc.
in this Agreement in each of their respective capacities as Seller
and as Servicer, shall be deemed to be the agreements,
representations and warranties of Neiman Marcus Funding Corporation
and The Neiman Marcus Group, Inc. solely in each such respective
capacity for so long as Neiman Marcus Funding Corporation and The
Neiman Marcus Group, Inc. act in each such capacity under this
Agreement.
(e) Any reference to each Rating Agency shall only
apply to any specific rating agency if such rating agency is then
rating any outstanding Series.
(f) Unless otherwise specified, references to any
amount as on deposit or outstanding on any particular date shall mean
such amount at the close of business on such day.
(g) 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; references to any Section, Schedule or Exhibit are
references to Sections, Schedules and Exhibits in or to this
Agreement unless otherwise specified; and the term "including" means
"including without limitation."
ARTICLE II
Conveyance of Receivables
Conveyance of Receivables
. By execution of this Agreement, the Seller does hereby sell,
transfer, assign, set over and otherwise convey to the Trust, for the
benefit of the Certificateholders, all its right, title and interest in, to
and under the Receivables existing at the close of business on the Trust
Cut-Off Date, in the case of Receivables arising in the Initial Accounts
owned by The Neiman Marcus Group, Inc., as the initial Account Originator,
and on the applicable Addition Date, in the case of Receivables arising in
the Additional Accounts owned by the applicable Account Originator, and in
each case, thereafter created from time to time until the termination of
the Trust, all Recoveries allocable to the Trust as provided herein, all
moneys due or to become due and all amounts received with respect to any of
the foregoing and all proceeds (including "proceeds" as defined in the UCC)
of any of the foregoing. Such property, together with all moneys on
deposit in the Collection Account, the Excess Funding Account, the Series
Accounts and any Series Enhancement shall constitute the assets of the
Trust (the "Trust Assets"). The foregoing does not constitute and is not
intended to result in the creation or assumption by the Trust, the Trustee,
any Investor Certificateholders or any Series Enhancer of any obligation of
any Account Originator, the Servicer, the Seller or any other Person in
connection with the Accounts or the Receivables or under any agreement or
instrument relating thereto, including any obligation to Obligors, merchant
banks, merchants clearance systems or insurers.
The Seller agrees to record and file, at its own expense,
financing statements (and continuation statements when applicable) with
respect to the Receivables and other Trust Assets now existing and
hereafter created in Accounts owned by each Account Originator meeting the
requirements of applicable state law in such manner and in such
jurisdictions as are necessary to perfect, and maintain the perfection of,
the sale and assignment of such Receivables to the Trust, and to deliver a
file stamped copy of each such financing statement or other evidence of
such filing (which may, for purposes of this Section 2.01 consist of
telephone confirmation of such filing promptly followed by delivery to the
Trustee of a filestamped copy) to the Trustee on or prior to the initial
Closing Date, in the case of such Receivables arising in the Initial
Accounts, and (if any additional filing is so necessary) the applicable
Addition Date, in the case of such Receivables arising in Additional
Accounts. The Trustee shall be under no obligation whatsoever to file such
financing or continuation statements or to make any other filing under the
UCC in connection with such sale and assignment.
The Seller further agrees, at its own expense, (a) on or prior
to (x) the initial Closing Date, in the case of the Initial Accounts,
(y) the applicable Addition Date, in the case of Additional Accounts, and
(z) the applicable Removal Date, in the case of Removed Accounts, to
indicate in the appropriate computer files that Receivables created in
connection with the Accounts owned by each Account Originator (other than
Removed Accounts) have been conveyed to the Trust pursuant to this
Agreement for the benefit of the Certificateholders (or conveyed to the
Seller or its designee in accordance with Section 2.10, in the case of
Removed Accounts) by including (or deleting in the case of Removed
Accounts) in such computer files the code identifying each such Account and
(b) on or prior to the applicable Document Delivery Date, to deliver to the
Trustee a computer file, microfiche list or printed list containing a true
and complete list of all such Accounts, specifying for each such Account,
as of the Trust Cut-Off Date, in the case of the Initial Accounts, the
applicable Addition Cut-Off Date, in the case of Additional Accounts (other
than Automatic Additional Accounts), and the Removal Date, in the case of
Removed Accounts, its account number, the aggregate amount outstanding in
such Account and the aggregate amount of Principal Receivables outstanding
in such Account. Such file or list, as supplemented from time to time to
reflect Additional Accounts and Removed Accounts, shall be marked as
Schedule 1 to this Agreement and is hereby incorporated into and made a
part of this Agreement. The Seller further agrees not to alter the code
referenced in this paragraph with respect to any Account during the term of
this Agreement unless and until (a) such Account becomes a Removed Account
or (b) the Seller shall have delivered to the Trustee 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 Trustee in the
Receivables and other Trust Assets to continue to be perfected with the
priority required by this Agreement.
It is the intention of the parties hereto that the conveyance
of the Receivables and all other Trust Assets by the Seller to the Trustee,
on behalf of the Trust, as provided in this Section 2.01 be, and be
construed as, an absolute sale of the Receivables by the Seller to the
Trust, for the benefit of the Certificateholders. Furthermore, it is not
intended that such conveyance be deemed a pledge of the Receivables and the
other Trust Assets by the Seller to the Trustee to secure a debt or other
obligation of the Seller. This Agreement shall also be deemed to be a
security agreement within the meaning of Article 9 of the UCC and the
conveyance provided for in this Section 2.01 shall be deemed to be a grant
by the Seller to the Trustee of a "security interest" within the meaning of
Article 9 of the UCC in all of the Seller's right, title and interest in
and to the Receivables and other Trust Assets and all amounts payable to
the holders of the Receivables after the Closing Date in accordance with
the terms thereof and all proceeds of the conversion, voluntary or
involuntary, of the foregoing into cash, instruments, securities or other
property, including without limitation all amounts from time to time held
or invested in the Series Accounts, whether in the form of cash,
instruments, securities or other property.
Acceptance by Trustee
(a) . (a) The Trustee hereby acknowledges its
acceptance on behalf of the Trust of all right, title and interest to
the property, now existing and hereafter created, conveyed to the
Trust pursuant to Section 2.01 and declares that it shall maintain
such right, title and interest, upon the trust herein set forth, for
the benefit of all Certificateholders. The Trustee further
acknowledges that, prior to or simultaneously with the execution and
delivery of this Agreement, the Seller delivered to the Trustee the
computer file, microfiche list or printed list relating to the
Initial Accounts described in the penultimate paragraph of Section
2.01.
(b) The Trustee hereby agrees not to disclose to any
Person any of the account numbers or other information contained in
the computer files, microfiche lists or printed lists marked as
Schedule 1 or otherwise delivered to the Trustee from time to time,
except (i) to a Successor Servicer or as required by a Requirement of
Law applicable to the Trustee, (ii) in connection with the
performance of the Trustee's duties hereunder or (iii) in enforcing
the rights of Certificateholders. The Trustee (i) agrees to take
such measures as shall be reasonably requested by the Seller to
protect and maintain the security and confidentiality of such
information and (ii) in any event will maintain and preserve such
files or lists and the confidentiality of the information contained
in such files or lists in the same manner and with the same degree of
care that it would exercise with respect to similar files, lists or
information maintained by it for its own account. The Trustee will
also, upon two Business Days prior notice, allow the Seller to
inspect the Trustee's security and confidentiality arrangements from
time to time during normal business hours. The Trustee shall provide
the Seller with notice no later than five Business Days prior to any
disclosure pursuant to this Section.
(c) The Trustee shall have no power to create, assume
or incur indebtedness or other liabilities in the name of the Trust
other than as contemplated in this Agreement or any Supplement.
(d) The Trustee hereby agrees not to use any
information it obtains pursuant to this Agreement, including any of
the account numbers or other information contained in the computer
files, microfiche lists or printed lists marked as Schedule 1 or
otherwise delivered by the Seller to the Trustee pursuant to Sections
2.01, 2.09, 2.10 or 3.04(c), to compete or assist any person in
competing with any Account Originator or the Seller in their
respective businesses.
Representations and Warranties of the Seller Relating to the
Seller
. The Seller hereby represents and warrants to the Trust (and
agrees that the Trustee may rely on each such representation and warranty
in accepting the Receivables in trust and in authenticating the
Certificates) as of each Closing Date that:
(a) Organization and Good Standing. The Seller is a
corporation validly existing in good standing under the laws of the
State of Delaware, and has full corporate power, authority and legal
right to own its properties and conduct its business as such
properties are presently owned and such business is presently
conducted, to execute, deliver and perform its obligations under this
Agreement and each Supplement and to execute and deliver to the
Trustee the Certificates pursuant hereto.
(b) Due Qualification. The Seller is duly qualified to
do business and is in good standing as a foreign corporation (or is
exempt from such requirements), and has obtained all necessary
licenses and approvals in each jurisdiction in which failure to so
qualify or to obtain such licenses and approvals would render any
Account Agreement relating to an Account owned by any Account
Originator or any Receivable transferred to the Trust by the Seller
unenforceable by the Account Originator, the Seller, the Servicer or
the Trustee or would have a material adverse effect on the interests
of the Certificateholders hereunder or under any Supplement.
(c) Due Authorization. The execution, delivery and
performance of this Agreement and each Supplement by the Seller, the
execution and delivery to the Trustee of the Certificates by the
Seller and the consummation by the Seller of the transactions
provided for in this Agreement and each Supplement have been duly
authorized by the Seller by all necessary corporate action on the
part of the Seller and this Agreement and each Supplement will
remain, from the time of its execution, an official record of the
Seller.
(d) No Conflict. The execution and delivery by the
Seller of this Agreement, each Supplement and the Certificates, the
performance by the Seller of the transactions contemplated by this
Agreement and each Supplement and the fulfillment by the Seller of
the terms hereof and thereof 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
any of its properties are bound.
(e) No Violation. The execution and delivery by the
Seller of this Agreement, each Supplement and the Certificates, the
performance by the Seller of the transactions contemplated by this
Agreement and each Supplement and the fulfillment by the Seller of
the terms hereof and thereof will not conflict with or violate any
Requirements of Law applicable to the Seller.
(f) 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 tribunal or governmental
instrumentality (i) asserting the invalidity of this Agreement, any
Supplement or the Certificates, (ii) seeking to prevent the issuance
of the Certificates or the consummation of any of the transactions
contemplated by this Agreement, any Supplement or the Certificates,
(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 Agreement or
any Supplement, (iv) seeking any determination or ruling that would
materially and adversely affect the validity or enforceability of
this Agreement, any Supplement or the Certificates or (v) seeking to
affect adversely the income tax attributes of the Trust under the
Federal or applicable state income or franchise tax systems.
(g) All Consents Required. All approvals,
authorizations, consents, orders or other actions of any Person or of
any governmental body or official required in connection with the
execution and delivery by the Seller of this Agreement, each
Supplement and the Certificates, the performance by the Seller of the
transactions contemplated by this Agreement and each Supplement and
the fulfillment by the Seller of the terms hereof and thereof, have
been obtained.
(h) Insolvency. No Insolvency Event with respect to
any Account Originator or the Seller has occurred and the transfer of
the Receivables by the Seller to the Trust has not been made in
contemplation of the occurrence thereof.
The representations and warranties of the Seller set forth in
this Section 2.03 shall survive the transfer and assignment by the Seller
of the respective Receivables to the Trust. Upon discovery by the Seller,
the Servicer or the Trustee of a breach of any of the representations and
warranties by the Seller set forth in this Section 2.03, the party
discovering such breach shall give prompt written notice to the others and
to each Series Enhancer entitled thereto pursuant to the relevant
Supplement. The Seller agrees to cooperate with the Servicer and the
Trustee in attempting to cure any such breach. For purposes of the
representations and warranties set forth in this Section 2.03, each
reference to a Supplement shall be deemed to refer only to those
Supplements in effect as of the relevant Closing Date.
Representations and Warranties of the Seller Relating to the
Agreement and any Supplement and the Receivables
(a) . (a) Representations and Warranties. The Seller
hereby represents and warrants to the Trust (and agrees that the
Trustee may rely on each such representation and warranty in
accepting the Receivables in trust and in authenticating the
Certificates) as of the date of this Agreement and the date of each
Supplement, as of each Closing Date and, with respect to Additional
Accounts, as of the related Addition Date that:
(i) this Agreement, each Supplement and, in the
case of Additional Accounts, the related Assignment, 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 bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect affecting the
enforcement of creditors' rights in general and except as such
enforceability may be limited by general principles of equity
(whether considered in a suit at law or in equity);
(ii) as of the first Closing Date and as of the
related Addition Date with respect to Additional Accounts, and
as of the applicable Removal Date with respect to the Removed
Accounts, Schedule 1 to this Agreement and the related computer
file, microfiche list or printed list delivered pursuant to
this Agreement, as supplemented to such date, is an accurate
and complete listing in all material respects of all the
Accounts owned by each Account Originator as of the Trust Cut-
Off Date, such Additional Cut-Off Date or such Removal Date, as
the case may be, and the information contained therein with
respect to the identity of such Accounts and the Receivables
existing in such Accounts is true and correct in all material
respects as of the Trust Cut-Off Date, such Addition Cut-Off
Date or such Removal Date, as the case may be;
(iii) the Seller is the legal and beneficial owner
of all right, title and interest in each Receivable and the
Seller has the full right to transfer such Receivables to the
Trust, and each Receivable conveyed to the Trust by the Seller
has been conveyed to the Trust 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 subsection
2.07(b)) and in compliance, in all material respects, 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 Receivables to the Trust have been duly obtained,
effected or given and are in full force and effect;
(v) this Agreement or, in the case of Additional
Accounts, the related Assignment constitutes a valid transfer
and assignment to the Trust of all right, title and interest of
the Seller in the Receivables and other Trust Assets conveyed
to the Trust by the Seller and all monies due or to become due
with respect thereto and the proceeds thereof and this
Agreement or, in the case of Additional Accounts, the related
Assignment constitutes a grant of a "security interest" (as
defined in the UCC) in such property to the Trust, that, in the
case of existing Receivables and the proceeds thereof, 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 that will be
enforceable with respect to such Receivables hereafter and
thereafter created and the proceeds thereof upon such creation.
Upon the filing of the financing statements pursuant to Section
2.01 and, in the case of Receivables hereafter created and the
proceeds thereof, upon the creation thereof, the Trust shall
have a first priority security interest in such property and
proceeds (as defined in the UCC) except for Liens permitted
under subsection 2.07(b);
(vi) except as otherwise expressly provided in
this Agreement or any Supplement, neither the Seller nor any
Person claiming through or under the Seller has any claim to or
interest in the Collection Account, the Excess Funding Account,
any Series Account or any Series Enhancement;
(vii) on the Trust Cut-Off Date, each Initial
Account is an Eligible Account (and each such Initial Account
was, as of the Trust Cut-Off Date, a "NM regular account",
"InCircle Card", "NM Plus Card", "NM Signature Account" or
"Platinum Card" revolving credit card or installment account),
and on the applicable Addition Cut-Off Date, each related
Additional Account is an Eligible Account;
(viii) on the Trust Cut-Off Date, each
Receivable then existing is an Eligible Receivable and, on the
applicable Addition Cut-Off Date, each Receivable contained in
any related Additional Account is an Eligible Receivable;
(ix) as of the date of the creation of any new
Receivable, such Receivable is an Eligible Receivable; and
(x) no selection procedure has been utilized by
The Neiman Marcus Group, Inc., as the initial Account
Originator or the Seller that the Seller reasonably believes
would result in a selection of Initial Accounts (from among the
available Eligible Accounts owned by The Neiman Marcus Group,
Inc., as the initial Account Originator on the Trust Cut-Off
Date) that would be materially adverse to the interests of the
Investor Certificateholders.
(b) Notice of Breach. The representations and
warranties of the Seller set forth in this Section 2.04 shall survive
the transfer and assignment by the Seller of Receivables to the
Trust. Upon discovery by the Seller, the Servicer or the Trustee of
a breach of any of the representations and warranties by the Seller
set forth in this Section 2.04, the party discovering such breach
shall give prompt written notice to the others and to each Series
Enhancer entitled thereto pursuant to the relevant Supplement. The
Seller agrees to cooperate with the Servicer and the Trustee in
attempting to cure any such breach. For purposes of the
representations and warranties set forth in this Section 2.04, each
reference to a Supplement shall be deemed to refer only to those
Supplements in effect as of the date of the relevant representations
or warranties.
Reassignment of Ineligible Receivables
(a) . (a) Reassignment of Receivables. In the event
(i) any representation or warranty of the Seller contained in Section
2.04(a)(ii), (iii), (iv), (vii), (viii), (ix) or (x) is not true and
correct in any material respect as of the date specified therein with
respect to any Receivable transferred to the Trust by the Seller or
any Account owned by any Account Originator and as a result of such
breach any Receivables in the related Account become Defaulted
Receivables or the Trust's rights in, to or under such Receivables or
the proceeds of such Receivables are impaired or such proceeds are
not available for any reason to the Trust free and clear of any Lien,
the principal balance of such Receivables shall be reduced to zero
for the purposes of this Agreement and, unless cured within 60 days
(or such longer period, not in excess of 150 days, as may be agreed
to by the Trustee) after the earlier to occur of the discovery
thereof by the Seller or receipt by the Seller or a designee of the
Seller of notice thereof given by the Trustee, or (ii) it is so
provided in Section 2.07(a) with respect to any Receivables
transferred to the Trust by the Seller, then the Seller shall accept
reassignment of all Receivables in the related Account ("Ineligible
Receivables") on the terms and conditions set forth in paragraph
(b) below; provided, however, that such Receivables will not be
deemed to be Ineligible Receivables and will not be reassigned to the
Seller if, on any day prior to the end of such 60day or longer
period, (x) either (A) in the case of an event described in clause
(i) above the relevant representation and warranty shall be true and
correct in all material respects as if made on such day or (B) in the
case of an event described in clause (ii) above the circumstances
causing such Receivable to become an Ineligible Receivable shall no
longer exist and (y) the Seller shall have delivered an Officer's
Certificate describing the nature of such breach and the manner in
which the relevant representation and warranty became true and
correct.
(b) Price of Reassignment. The Servicer shall deduct
the portion of the Ineligible Receivables reassigned to the Seller
that are Principal Receivables from the aggregate amount of Principal
Receivables used to calculate the Seller's Interest, the Retained
Interest and the Floating Allocation Percentage and the Principal
Allocation Percentage applicable to any Series. If, following the
exclusion of such Principal Receivables from the calculation of the
Seller's Interest and the Retained Interest, the Seller's Interest
would be less than the Required Seller's Interest or the Retained
Interest will be less than the Required Retained Interest, the Seller
shall make a deposit into the Excess Funding Account in immediately
available funds prior to the next succeeding Business Day in an
amount equal to the amount by which the Seller's Interest would be
less than the Required Seller's Interest or the amount by which the
Retained Interest would be less than the Required Retained Interest,
as the case may be (up to the amount of such Principal Receivables).
The payment of such deposit amount in immediately available funds
shall otherwise be considered payment in full of all of the
Ineligible Receivables.
Upon the deposit, if any, required to be made to the Excess
Funding Account as provided in this Section and the reassignment of
Ineligible Receivables, the Trustee, on behalf of the Trust, shall
automatically and without further action be deemed to sell, transfer,
assign, set over and otherwise convey to the Seller or its designee,
without recourse, representation or warranty, all the right, title and
interest of the Trust in and to such Ineligible Receivables, all moneys due
or to become due and all amounts received with respect thereto and all
proceeds thereof. The Trustee shall execute such documents and instruments
of transfer or assignment and take such other action as shall reasonably be
requested by the Seller to effect the conveyance of Ineligible Receivables
pursuant to this Section. The obligation of the Seller to accept
reassignment of any Ineligible Receivables, and to make the deposits, if
any, required to be made to the Excess Funding Account as provided in this
Section, shall constitute the sole remedy respecting the event giving rise
to such obligation available to Certificateholders (or the Trustee on
behalf of the Certificateholders) or any Series Enhancer.
Reassignment of Receivables in Trust Portfolio
. If any representation or warranty of the Seller set forth in
Section 2.03(a), (b) or (c) or Section 2.04(a)(i), (v) or (vi) is not true
and correct in any material respect and such breach has a material adverse
effect on the Certificateholders' Interest in the Receivables transferred
to the Trust by the Seller, then either the Trustee or the Holders of
Investor Certificates evidencing not less than 50% of the aggregate unpaid
principal amount of all outstanding Investor Certificates, by notice then
given to the Seller and the Servicer (and to the Trustee if given by the
Investor Certificateholders), may direct the Seller to accept a
reassignment of the Receivables transferred to the Trust by the Seller if
such breach and any material adverse effect caused by such breach is not
cured within 60 days of such notice (or within such longer period, not in
excess of 150 days, as may be specified in such notice), and upon those
conditions the Seller shall be obligated to accept such reassignment on the
terms set forth below; provided, however, that such Receivables will not be
reassigned to the Seller if, on any day prior to the end of such 60day or
longer period (i) the relevant representation and warranty shall be true
and correct in all material respects as if made on such day and (ii) the
Seller shall have delivered an Officer's Certificate describing the nature
of such breach and the manner in which the relevant representation and
warranty became true and correct.
The Seller shall deposit in the Collection Account in
immediately available funds not later than 12:00 noon, New York City time,
on the first Distribution Date following the Monthly Period in which such
reassignment obligation arises, in payment for such reassignment, an amount
equal to the sum of the amounts specified therefor with respect to each
outstanding Series in the related Supplement. Notwithstanding anything to
the contrary in this Agreement, such amounts shall be distributed on such
Distribution Date in accordance with Article IV and the terms of each
Supplement. The payment of such deposit amount in immediately available
funds shall otherwise be considered payment in full of all of the
Receivables.
Upon the deposit, if any, required to be made to the Collection
Account as provided in this Section and the reassignment of the applicable
Receivables, the Trustee, on behalf of the Trust, shall automatically and
without further action be deemed to sell, transfer, assign, set over and
otherwise convey to the Seller or its designee, without recourse,
representation or warranty, all the right, title and interest of the Trust
in and to such Receivables, all moneys due or to become due and all amounts
received with respect thereto and all proceeds thereof. The Trustee 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 Receivables pursuant to this Section. The
obligation of the Seller to accept reassignment of any Receivables, and to
make the deposits, if any, required to be made to the Collection Account as
provided in this Section, shall constitute the sole remedy respecting the
event giving rise to such obligation available to Certificateholders (or
the Trustee on behalf of the Certificateholders).
Covenants of the Seller
. The Seller hereby covenants as follows:
(a) Receivables to be Accounts, General Intangibles or
Chattel Paper. Except in connection with the enforcement or
collection of an Account, the Seller will take no action to cause any
Receivable transferred by it to the Trust to be evidenced by any
instrument (as defined in the UCC) and, if any such Receivable is so
evidenced (whether or not in connection with the enforcement or
collection of an Account), it shall be deemed to be an Ineligible
Receivable in accordance with Section 2.05(a) and shall be reassigned
to the Seller in accordance with Section 2.05(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, whether now existing or hereafter
created, or any interest therein; the Seller will immediately notify
the Trustee of the existence of any Lien on any Receivable; and the
Seller shall defend the right, title and interest of the Trust 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 2.07(b) shall
prevent or be deemed to prohibit the Seller from suffering to exist
upon any of the Receivables any Liens for 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. Notwithstanding the foregoing, nothing in this
Section 2.07(b) shall be construed to prevent or be deemed to
prohibit the transfer of the Seller Certificate and certain other
rights of the Seller in accordance with the terms of this Agreement
and any related Supplement.
(c) Seller's Interest. Except for the conveyances
hereunder, in connection with any transaction permitted by Sections
7.02 and as provided in Sections 2.13 and 6.03, the Seller agrees not
to transfer, assign, exchange or otherwise convey or pledge,
hypothecate or otherwise grant a security interest in the Seller's
Interest represented by the Seller Certificate or any Supplemental
Certificate and any such attempted transfer, assignment, exchange,
conveyance, pledge, hypothecation or grant shall be void.
(d) Delivery of Collections or Recoveries. If the
Seller receives Collections or Recoveries, the Seller agrees to pay
the Servicer 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 by the Seller.
(e) Notice of Liens. The Seller shall notify the
Trustee and each Series Enhancer entitled to such notice pursuant to
the relevant Supplement promptly after becoming aware of any Lien on
any Receivable other than the conveyances hereunder or Liens
permitted under Section 2.07(b).
(f) Separate Corporate Existence. The Seller shall:
(i) Maintain in full effect its existence, rights
and franchises as a corporation under the laws of the state of
its incorporation and will obtain and preserve its
qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity
and enforceability of this Agreement and the Purchase
Agreements and each other instrument or agreement necessary or
appropriate to proper administration hereof and permit and
effectuate the transactions contemplated hereby.
(ii) Maintain its own deposit account or accounts,
separate from those of any Affiliate of the Seller, with
commercial banking institutions. The funds of the Seller will
not be diverted to any other Person or for other than the
corporate use of the Seller, and, except as may be expressly
permitted by this Agreement or the Purchase Agreements, the
funds of the Seller shall not be commingled with those of any
Affiliate of the Seller.
(iii) Ensure that, to the extent that it shares the
same officers or other employees as any of its stockholders or
Affiliates, the salaries of and the expenses related to
providing benefits to such officers and other employees shall
be fairly allocated among such entities, and each such entity
shall bear its fair share of the salary and benefit costs
associated with all such common officers and employees.
(iv) Ensure that, to the extent that it jointly
contracts with any of its stockholders or Affiliates to do
business with vendors or service providers or to share overhead
expenses, the costs incurred in so doing shall be allocated
fairly among such entities, and each such entity shall bear its
fair share of such costs. To the extent that Seller contracts
or does business with vendors or service providers where the
goods and services provided are partially for the benefit of
any other Person, the costs incurred in so doing shall be
fairly allocated to or among such entities for whose benefit
the goods and services are provided, and each such entity shall
bear its fair share of such costs. All material transactions
between the Seller and any of its Affiliates shall be only on
an arm's-length basis and shall receive the approval of the
Seller's Board of Directors including at least one Independent
Director (defined below).
(v) Maintain a principal executive and
administrative office through which its business is conducted
separate from those of its stockholders and Affiliates. To the
extent that the Seller and any of its stockholders or
Affiliates have offices in contiguous space, there shall be
fair and appropriate allocation of overhead costs among them,
and each such entity shall bear its fair share of such
expenses.
(vi) Conduct its affairs strictly in accordance
with its Certificate of Incorporation and observe all
necessary, appropriate and customary corporate formalities,
including, but not limited to, holding all regular and special
stockholders' and directors' meetings appropriate to authorize
all corporate action, keeping separate and accurate minutes of
such meetings, passing all resolutions or consents necessary to
authorize actions taken or to be taken, and maintaining
accurate and separate books, records and accounts, including,
but not limited to, payroll and intercompany transaction
accounts. Regular stockholders' and directors' meetings shall
be held at least annually.
(vii) Ensure that its Board of Directors shall be
elected independently from the Boards of Directors of its
Affiliates and shall at all times include at least one
Independent Director (for purposes hereof, "Independent
Director" shall mean any member of the Board of Directors of
the Seller that is not and has not at any time been (x) a
director, officer, employee or shareholder of any Affiliate of
the Seller or (y) a member of the immediate family of any of
the foregoing).
(viii) Ensure that decisions with respect to
its business and daily operations shall be independently made
by the Seller (although the officer making any particular
decision may also be an officer or director of an Affiliate of
the Seller) and shall not be dictated by an Affiliate of the
Seller.
(ix) Act solely in its own corporate name and
through its own authorized officers and agents, and no
Affiliate of the Seller shall be appointed to act as agent of
the Seller, except as expressly contemplated by this Agreement
or the Purchase Agreements;
(x) Ensure that no Affiliate of the Seller shall
advance funds to the Seller, other than capital contributions
from The Neiman Marcus Group, Inc. made to enable the Seller to
pay the purchase price of Receivables or as is otherwise
provided in any Purchase Agreement, and no Affiliate of the
Seller will otherwise supply funds to, or guaranty debts of,
the Seller; provided, however, that an Affiliate of the Seller
may provide funds to the Seller in connection with
capitalization of the Seller provided to assure that the Seller
has "substantial assets" as described in Treasury Regulation
Section 301.7701-2(d)(2).
(xi) Not enter into any guaranty, or otherwise
become liable, with respect to any obligation of any Affiliate
of the Seller other than with respect to Section 7.04.
(xii) Ensure that any financial reports required of
the Seller shall comply with generally accepted accounting
principles and shall be issued separately from, but may be
consolidated with, any reports prepared for any of its
Affiliates.
(g) 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 misleading within the meaning of Section 9-402(7) of the UCC
(or any other then applicable provision of the UCC) unless the Seller
shall have delivered to the Trustee 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 its chief executive office
or change the location of its principal records concerning the
Receivables, the Trust Assets or the Collections unless it has
delivered to the Trustee 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 Trustee in the Receivables and
other Trust Assets to continue to be perfected with the priority
required by this Agreement.
Covenants of The Seller with Respect to the Purchase Agreements
. The Seller, in its capacity as purchaser of the Receivables
from the Account Originators pursuant to the Purchase Agreements, hereby
covenants that the Seller will at all times enforce the covenants and
agreements of each Account Originator in the applicable Purchase Agreement,
including, without limitation, covenants to the effect set forth below.
(a) Periodic Finance Charges and Other Fees. Except as
otherwise required by any Requirement of Law, or as is deemed by the
applicable Account Originator in its sole discretion to be necessary
it shall not at any time reduce the annual percentage rates of the
Periodic Finance Charges assessed on the Receivables or other fees
charged on any of the Accounts if, as a result of any such reduction,
either (i) the Seller's reasonable expectation is that such reduction
will cause a Pay Out Event to occur or (ii) such reduction is not
also applied to any comparable segment of consumer revolving credit
card accounts or other consumer revolving or installment credit
accounts owned by the applicable Account Originator that have
characteristics the same as, or substantially similar to, such
Accounts.
(b) Account Agreements and Account Guidelines. Each
Account Originator shall comply with and perform its obligations
under the Account Agreements relating to its Accounts and the Account
Guidelines except insofar as any failure so to comply or perform
would not materially and adversely affect the rights of the Trust or
the Certificateholders hereunder or under the Certificates. Subject
to compliance with all Requirements of Law, each Account Originator
may change the terms and provisions of the Account Agreements or the
Account Guidelines with respect to any of the Accounts in any respect
(including the calculation of the amount, or the timing, of charge-
offs and the Periodic Finance Charges and other fees to be assessed
thereon) only if in the reasonable judgment of the Account Originator
such change is made applicable to any comparable segment of the
consumer revolving credit card accounts or other consumer revolving
or installment credit accounts owned by the Account Originator that
have characteristics the same as, or substantially similar to, such
Accounts.
The Seller further covenants that the Seller will not enter
into any amendments to any Purchase Agreement unless the Rating Agency
Condition has been satisfied.
Addition of Accounts
. (a) Required Additions.
(i) (i) If, as of the close of business on the
last Business Day of any Monthly Period, either (i) the
Seller's Interest is less than the Required Seller's Interest
on such date or (ii) the aggregate amount of Principal
Receivables plus amounts on deposit in the Excess Funding
Account is less than the Required Principal Balance on such
date, the Seller shall on or prior to the close of business on
the 10th Business Day following the last Business Day of such
Monthly Period (the "Required Designation Date"), unless the
Retained Interest exceeds the Required Retained Interest or the
aggregate amount of Principal Receivables plus amounts on
deposit in the Excess Funding Account exceeds the Required
Principal Balance, as the case may be, in either case as of the
close of business on any day after the last Business Day of
such Monthly Period and prior to the Required Designation Date,
designate additional Eligible Accounts to be included as
Accounts as of the Required Designation Date or any earlier
date in a sufficient amount such that, after giving effect to
such addition, the Seller's Interest as of the close of
business on the Addition Date is at least equal to the Required
Seller's Interest on such date and the aggregate amount of
Principal Receivables plus amounts on deposit in the Excess
Funding Account equals or exceeds the Required Principal
Balance on such date. The failure of any condition set forth
in paragraph (c) or (d) below, as the case may be, shall not
relieve the Seller of its obligation pursuant to this
paragraph; provided, however, that the failure of the Seller to
transfer Receivables to the Trust as provided in this paragraph
solely as a result of the unavailability of a sufficient amount
of Eligible Receivables shall not constitute a breach of this
Agreement; provided further, that any such failure that has not
been timely cured will nevertheless result in the occurrence of
a Pay Out Event with respect to each Series for which, pursuant
to the Supplement therefor, a failure by the Seller to convey
Receivables in Additional Accounts or Participation Interests
to the Trust by the day on which it is required to convey such
Receivables or Participation Interests constitutes a "Pay Out
Event" (as defined in such Supplement).
(ii) In lieu of, or in addition to, designating
Additional Accounts pursuant to clause (i) above, the Seller
may, subject to the conditions specified in paragraph
(c) below, convey to the Trust participations representing
undivided interests in a pool of assets primarily consisting of
revolving credit card or installment receivables generated in
accounts owned by any Account Originator, and any interests in
the foregoing, including securities representing or backed by
such receivables, and other self-liquidating financial assets
including, without limitation, any "Eligible Assets" as such
term is defined in Rule 3a-7 under the Investment Company Act
of 1940, as amended (or any successor to such Rule) and
collections thereon ("Participation Interests"). The addition
of Participation Interests in the Trust pursuant to this
paragraph (a) or paragraph (b) below shall be effected by a
Supplement, dated the applicable Addition Date, pursuant to
Section 13.01(a).
(b) Permitted Additions. The Seller may from time to
time, at its sole discretion, subject to the conditions specified in
paragraph (c) or (d) below, as the case may be, designate additional
Eligible Accounts to be included as Accounts or Participation
Interests to be included as Trust Assets, in either case as of the
applicable Addition Date.
(c) Conditions to Addition. On the Addition Date with
respect to any Additional Accounts or Participation Interests added
pursuant to Sections 2.09(a) or Section 2.09(b), the Trust shall
purchase the Receivables in such Additional Accounts (and such
Additional Accounts shall be deemed to be Accounts for purposes of
this Agreement) or shall purchase such Participation Interests,
subject to the satisfaction of the following conditions:
(i) on or before the tenth Business Day
immediately preceding the Addition Date, the Seller shall have
given the Trustee, the Servicer, each Rating Agency and any
Series Enhancer entitled thereto pursuant to the relevant
Supplement written notice that the Additional or Participation
Interests will be included and specifying the applicable
Addition Date, the Addition Cut-Off Date, the approximate
number of accounts expected to be added and the approximate
aggregate balances expected to be outstanding in the accounts
to be added;
(ii) in the case of Additional Accounts, the
Seller shall have delivered to the Trustee copies of UCCl
financing statements covering such Additional Accounts, if
necessary to perfect the Trust's interest in the Receivables
arising therein;
(iii) as of each of the Addition Cut-Off Date and
the Addition Date, (x) no Insolvency Event with respect to any
applicable Account Originator or the Seller shall have
occurred, (y) no applicable Account Originator or the Seller
shall be insolvent and (z) the transfer of the Receivables
arising in the Additional Accounts or the Participation
Interests to the Trust shall not have been made in
contemplation of the occurrence of an Insolvency Event or the
insolvency thereof;
(iv) except in the case of an Addition pursuant to
Section 2.09(a), the Rating Agency Condition shall have been
satisfied and in the case of an Addition pursuant to Section
2.09(a) that would exceed the Aggregate Addition Limit, the
Seller shall have provided to Standard & Poor's at least 15
days prior written notice of such Addition and at or prior to
the end of such 15day period, the Seller shall receive a notice
in writing from Standard & Poor's that such Addition will not
result in the lowering or withdrawal of its then existing
rating of the Investor Certificates of any Series;
(v) the Seller shall have delivered to the
Trustee and any Series Enhancer entitled thereto pursuant to
the relevant Supplement an Officer's Certificate, a copy of
which shall be delivered to each Rating Agency, dated the
Addition Date, stating that (x) in the case of Additional
Accounts, as of the applicable Addition Date the Additional
Accounts are all Eligible Accounts, (y) to the extent
applicable, the conditions set forth in clauses (ii) through
(iv) above have been satisfied and (z) the Seller reasonably
believes that (A) the addition by the Seller of the Receivables
arising in the Additional Accounts or of the Participation
Interests to the Trust will not, based on the facts known to
such officer at the time of such certification, then or
thereafter cause a Pay Out Event to occur with respect to any
Series or otherwise have a material adverse effect on any
Series and (B) in the case of Additional Accounts, no selection
procedure was utilized by the Seller that would result in a
selection of Additional Accounts (from among the available
Eligible Accounts owned by the applicable Account Originator)
that would be materially adverse to the interests of the
Investor Certificateholders of any Series as of the Addition
Date; and
(vi) the Seller shall have delivered to the
Trustee, each Rating Agency and any Series Enhancer entitled
thereto pursuant to the relevant Supplement an outside Opinion
of Counsel, dated the Addition Date, in accordance with Section
13.02(d).
(d) Automatic Additional Accounts. Subject to the
limitations specified below in this subsection 2.09(d) and to any
further limitations specified in any Supplement, Automatic Additional
Accounts shall be included as Accounts from and after the date upon
which they are created, and all Receivables in Automatic Additional
Accounts, whether such Receivables are then existing or thereafter
created, shall be transferred automatically to the Trust upon their
creation. For purposes of the foregoing, "Automatic Additional
Accounts" means revolving credit card accounts or other consumer
revolving or installment credit accounts that are (x) originated
after March 1, 1995, by an Account Originator and (y) of a type
included as Initial Accounts or that have previously been listed in
the Restatement Date Account Schedule or included in any Addition
(that, with respect to any Addition, satisfies the Account
Guidelines) effected in accordance with all of the conditions
specified in subsection 2.09(c) or (d); provided however, the Seller
may add other types of Accounts pursuant to this Section 2.09(d) if
the Rating Agencies consent, in writing, to the addition of such
other types of Accounts. The Seller may elect at any time to
terminate the inclusion in Accounts of new accounts which would
otherwise be Automatic Additional Accounts as of any Business Day
(the "Automatic Addition Termination Date"), or suspend any such
inclusion as of any Business Day (an "Automatic Addition Suspension
Date") until a date (the "Restart Date") to be notified in writing by
the Seller to the Trustee by delivering to the Trustee, Servicer and
each Rating Agency at least ten days' prior written notice of such
election with respect to an Automatic Addition Termination Date,
Automatic Addition Suspension Date or Restart Date, as the case may
be. Promptly after each of an Automatic Addition Termination Date,
an Automatic Addition Suspension Date and a Restart Date, the Seller
and the Trustee agree to execute, and the Seller agrees to record and
file at its own expense, an amendment to the financing statements
referred to in Section 2.01 to specify the accounts then subject to
this Agreement (which specification may incorporate a list of
accounts by reference) and, except in connection with any such filing
made after a Restart Date, to release any security interest in any
accounts created after the Automatic Addition Termination Date or
Automatic Addition Suspension Date.
In addition, no accounts created on any day shall be Automatic
Additional Accounts unless all of the following conditions shall have
been satisfied as of that day:
(i) if the Aggregate Addition Limit would be
exceeded as a result of the inclusion of such Automatic
Additional Accounts as Accounts, the Rating Agency Condition
shall have been satisfied with respect thereto;
(ii) the Seller shall have executed and delivered
to the Trustee copies of UCCl financing statements covering
such Automatic Additional Accounts, if necessary to perfect the
Trust's interest in the Receivables arising thereunder; and
(iii) as of each of the Addition Cut-Off Date and
the Addition Date, (x) no Insolvency Event with respect to any
applicable Account Originator or the Seller shall have
occurred, (y) no applicable Account Originator or the Seller
shall be insolvent and (z) the transfer of the Receivables
arising in the Additional Accounts or the Participation
Interests to the Trust shall not have been made in
contemplation of the occurrence of an Insolvency Event or the
insolvency thereof.
(e) Representations and Warranties. The Seller hereby
represents and warrants to the Trust as of the related Addition Date
as to the matters relating to it set forth in paragraph (d)(iii)
above and that the file or list delivered pursuant to paragraph
(f) below is, as of the applicable Addition Cut-Off Date, true and
complete in all material respects.
(f) Delivery of Documents. In the case of the
designation of Additional Accounts (other than Automatic Additional
Accounts), the Seller shall deliver to the Trustee (i) the computer
file, microfiche list or printed list required to be delivered
pursuant to Section 2.01 with respect to such Additional Accounts on
the applicable Document Delivery Date and (ii) a duly executed,
written Assignment (including an acceptance by the Trustee for the
benefit of the Certificateholders), substantially in the form of
Exhibit B (the "Assignment"), on the Document Delivery Date. On each
day, Schedule 1 to this Agreement shall be automatically deemed to be
supplemented to include any Automatic Additional Accounts created on
that day.
Removal of Accounts
. On any day of any Monthly Period the Seller shall have the
right to require the reassignment to it or its designee of all the Trust's
right, title and interest in, to and under the Receivables then existing
and thereafter created, all moneys due or to become due and all amounts
received with respect thereto and all proceeds thereof in or with respect
to the Accounts then designated by the Seller (the "Removed Accounts") or
Participation Interests (unless otherwise set forth in the applicable
Supplement), upon satisfaction of the following conditions:
(a) on or before the tenth Business Day immediately
preceding the Removal Date (the "Removal Notice Date") the Seller
shall have given the Trustee, the Servicer, each Rating Agency and
any Series Enhancer entitled thereto pursuant to the relevant
Supplement written notice of such removal and specifying the date for
removal of the Removed Accounts and Participation Interests (the
"Removal Date");
(b) with respect to Removed Accounts, on or prior to
the date that is 10 Business Days after the Removal Date, the Seller
shall have amended Schedule 1 by delivering to the Trustee a computer
file, microfiche list or printed list containing a true and complete
list of the Removed Accounts specifying for each such Account, as of
the Removal Notice Date, its account number, the aggregate amount
outstanding, and the aggregate amount of Principal Receivables
outstanding in such Account;
(c) with respect to Removed Accounts, the Seller shall
have represented and warranted as of the Removal Date that the list
of Removed Accounts delivered pursuant to paragraph (b) above, as of
the Removal Date, is true and complete in all material respects;
(d) the Rating Agency Condition shall have been
satisfied with respect to such removal;
(e) the Seller shall have delivered to the Trustee and
any Series Enhancer entitled thereto pursuant to the relevant
Supplement an Officer's Certificate, dated as of the Removal Date, to
the effect that the Seller reasonably believes that (i) such removal
will not, based on the facts known to such officer at the time of
such certification, then or thereafter cause a Pay Out Event to occur
with respect to any Series and (ii) no selection procedure was
utilized by the Seller that would result in a selection of Removed
Accounts or Participation Interests that would be materially adverse
to the interests of the Investor Certificateholders of any Series as
of the Removal Date;
(f) the Seller shall not utilize a selection procedure
intended to include a disproportionately higher level of Defaulted
Receivables in the Removed Accounts than exist in the Accounts and
shall not remove such Accounts for the intended purpose of mitigating
losses to the Trust; and
(g) such other conditions and restrictions as may at
any time be specified in an Officer's Certificate of the Seller
delivered to the Trustee shall have been satisfied, it being
understood that (i) no such additional conditions or restrictions may
conflict with or override any of the conditions and restrictions
specified above and (ii) upon delivery of such an Officer's
Certificate to the Trustee the additional conditions and restrictions
specified therein shall be deemed to be incorporated by reference
into and become a part of this Agreement.
Upon satisfaction of the above conditions, the Trustee shall
execute and deliver to the Seller a written reassignment in substantially
the form of Exhibit C (the "Reassignment") and shall, without further
action, be deemed to sell, transfer, assign, set over and otherwise convey
to the Seller or its designee, effective as of the Removal Date, without
recourse, representation or warranty, all the right, title and interest of
the Trust in and to the Receivables arising in the Removed Accounts or the
Participation Interests, all moneys due and to become due and all amounts
received with respect thereto and all proceeds thereof. In addition, the
Trustee shall execute such other 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 Receivables pursuant to this
Section.
Account Allocations
. If the Seller is unable for any reason to transfer
Receivables to the Trust in accordance with the provisions of this
Agreement, including by reason of any order of any Governmental Authority
(a "Transfer Restriction Event"), then, in any such event, (a) the Seller
and the Servicer agree (except as prohibited by any such order) to allocate
and pay to the Trust, after the date of such inability, all Collections of
Receivables including Collections of Receivables transferred to the Trust
by the Seller prior to the occurrence of such event, and all amounts that
would have constituted Collections but for the Seller's inability to
transfer Receivables (up to an aggregate amount equal to the amount of
Receivables in the Trust on such date), (b) the Seller and the Servicer
agree that such amounts will be applied as Collections in accordance with
Article IV and the terms of each Supplement and (c) for so long as the
allocation and application of all Collections and all amounts that would
have constituted Collections are made in accordance with clauses (a) and
(b) above, Principal Receivables and all amounts that would have
constituted Principal Receivables but for the Seller's inability to
transfer Receivables to the Trust that are written off as uncollectible in
accordance with this Agreement shall continue to be allocated in accordance
with Article IV and the terms of each Supplement. For the purpose of the
immediately preceding sentence, the Seller and the Servicer shall treat the
first received Collections as allocable to the Trust until the Trust shall
have been allocated and paid Collections in an amount equal to the
aggregate amount of Principal Receivables in such Accounts as of the date
of the occurrence of such event. If the Seller or the Servicer is unable
pursuant to any Requirements of Law to allocate Collections as described
above, the Seller and the Servicer agree that, after the occurrence of such
event, payments on each Account with respect to the principal balance of
such Account shall be allocated first to the oldest principal balance of
such Account and shall have such payments applied as Collections in
accordance with Article IV and the terms of each Supplement. The parties
hereto agree that Finance Charge Receivables, whenever created, accrued in
respect of Principal Receivables that have been conveyed to the Trust shall
continue to be a part of the Trust notwithstanding any cessation of the
transfer of additional Principal Receivables to the Trust and Collections
with respect thereto shall continue to be allocated and paid in accordance
with Article IV and the terms of each Supplement.
Discount Option
(a) . (a) The Seller shall have the option to
designate at any time a percentage, that may be a fixed percentage or
a variable percentage based on a formula (the "Discount Percentage"),
of the amount of Receivables arising in the Accounts on or after the
date such designation becomes effective that would otherwise
constitute Principal Receivables to be treated as Finance Charge
Receivables ("Discount Option Receivables"). Without limiting the
generality of the foregoing, Discount Option Receivables shall be
excluded from the amount of Principal Receivables for purposes of all
calculations of the Defaulted Amount, Defaulted Receivables, the
Retained Percentage, the Seller's Interest (including related
calculations under Sections 2.05(b) and 3.09), the aggregate amount
of Principal Receivables for purposes of Section 2.09(a) and the
accrual of the Monthly Servicing Fee pursuant to Section 3.02 or any
Supplement.
(b) On each Date of Processing after the date on which
the Seller's exercise of its discount option takes effect, the Seller
shall treat Discount Option Receivables Collections as Collections of
Finance Charge Receivables.
Additional Sellers and Account Originators
. The Seller may designate Affiliates of the Seller to be
included as Sellers under this Agreement by an amendment to this Agreement
(which amendment shall be subject to Section 13.01 and, in connection with
such designation, the Seller shall surrender the Seller Certificate to the
Trustee in exchange for a newly issued Seller Certificate reflecting such
additional Seller's interest in the Seller's Interest; provided, however,
that prior to any such designation and issuance the conditions set forth in
Section 6.03(c) shall have been satisfied with respect thereto. Upon
satisfaction of the Rating Agency Condition, the Seller may also enter into
additional receivables purchase agreements with Affiliates of The Neiman
Marcus Group, Inc. that are owners of credit card accounts or other
consumer revolving credit or installment accounts, which receivables
purchase agreements shall constitute "Purchase Agreements" and which owners
shall constitute "Account Originators."
ARTICLE III
Administration and Servicing of Receivables
Acceptance of Appointment and Other Matters Relating to the
Servicer
(a) . (a) The Neiman Marcus Group, Inc. agrees to act
as the Servicer under this Agreement and the Certificateholders by
their acceptance of Certificates consent to The Neiman Marcus Group,
Inc. acting as Servicer.
(b) The Servicer shall service and administer the
Receivables, shall collect payments due under the Receivables and
shall charge off as uncollectible Receivables, all in accordance with
its customary and usual servicing procedures for servicing credit
card and other consumer revolving credit or installment receivables
comparable to the Receivables and in accordance with the Account
Guidelines. 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 that it may deem necessary or desirable. Without
limiting the generality of the foregoing, subject to Section 10.01
and provided The Neiman Marcus Group, Inc. is the Servicer, the
Servicer or its designee (rather than the Trustee) is hereby
authorized and empowered (i) to make withdrawals and payments or to
instruct the Trustee to make withdrawals and payments from the
Collection Account and any Series Account, as set forth in this
Agreement or any Supplement, and (ii) to take any action required or
permitted under any Series Enhancement, as set forth in this
Agreement or any Supplement. Without limiting the generality of the
foregoing and subject to Section 10.01, the Servicer or its designee
is hereby authorized and empowered 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. The Trustee shall furnish
the Servicer with any powers of attorney or other documents necessary
or appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder.
(c) The Servicer shall not be obligated to use separate
servicing procedures, offices, employees or accounts for servicing
the Receivables from the procedures, offices, employees and accounts
used by the Servicer in connection with servicing other credit card
receivables.
(d) The Servicer shall comply with and perform its
servicing obligations with respect to the Accounts and Receivables in
accordance with the Account Agreements relating to the Accounts and
the Account Guidelines except insofar as any failure to so comply or
perform would not materially and adversely affect the Trust or the
Investor Certificateholders.
(e) The Servicer shall pay out of its own funds,
without reimbursement, all expenses incurred in connection with the
Trust and the servicing activities hereunder including expenses
related to enforcement of the Receivables, fees and disbursements of
the Trustee, any Paying Agent and any Transfer Agent and Registrar
(including the reasonable fees and expenses of its counsel) in
accordance with Section 11.05, fees and disbursements of independent
accountants and all other fees and expenses, including the costs of
filing UCC continuation statements and the costs and expenses
relating to obtaining and maintaining the listing of any Investor
Certificates on any stock exchange, that are not expressly stated in
this Agreement to be payable by the Trust or the Seller (other than
Federal, state, local and foreign income, franchise and other taxes,
if any, or any interest or penalties with respect thereto, assessed
on the Trust).
(f) The Servicer agrees that upon a request by the
Seller it will use its best efforts to obtain and maintain the
listing of the Investor Certificates of any Series or Class on any
specified securities exchange. If any such request is made, the
Servicer shall give notice to the Seller and the Trustee on the date
on which such Investor Certificates are approved for such listing.
Within three Business Days following receipt of notice by the
Servicer of any actual, proposed or contemplated delisting of such
Investor Certificates by any such securities exchange the Servicer,
in its sole discretion, may terminate any listing on any such
securities exchange.
Servicing Compensation
. As full compensation for its servicing activities hereunder
and as reimbursement for any expense incurred by it in connection
therewith, the Servicer shall be entitled to receive a servicing fee (the
"Servicing Fee") with respect to each Monthly Period, payable monthly on
the related Distribution Date, in an amount equal to one-twelfth of the
product of (a) the weighted average of the Servicing Fee Rates with respect
to each outstanding Series (based upon the Servicing Fee Rate for each
Series and the Invested Amount (or such other amount as specified in the
related Supplement) of such Series, in each case as of the last day of the
prior Monthly Period) and (b) the amount of Principal Receivables on the
last day of the prior Monthly Period. The share of the Servicing Fee
allocable to (i) the Certificateholders' Interest of a particular Series
with respect to any Monthly Period (the "Monthly Servicing Fee") and
(ii) the Enhancement Invested Amount, if any, of a particular Series with
respect to any Monthly Period will each be determined in accordance with
the relevant Supplement. The portion of the Servicing Fee with respect to
any Monthly Period not so allocated to the Certificateholders' Interest or
the Enhancement Invested Amount, if any, of a particular Series shall be
paid by the Holder of the Seller Certificate on the related Distribution
Date and in no event shall the Trust, the Trustee, the Investor
Certificateholders of any Series or any Series Enhancer be liable for the
share of the Servicing Fee with respect to any Monthly Period to be paid by
the Holder of the Seller Certificate.
Representations, Warranties and Covenants of the Servicer
. The Neiman Marcus Group, Inc., as initial Servicer, hereby
makes, and any Successor Servicer by its appointment hereunder shall make,
on each Closing Date (and on the date of any such appointment), the
following representations, warranties and covenants to the Trust (and
agrees that the Trustee may rely on each such representation, warranty and
covenant in accepting the Receivables in trust and in authenticating the
Certificates):
(a) Organization and Good Standing. The Servicer is a
corporation (or with respect to such Successor Servicer, such other
corporate entity as may be applicable) duly organized, validly
existing and in good standing under the laws of its state of
incorporation, and has full corporate power, authority and legal
right to execute, deliver and perform its obligations under this
Agreement and each Supplement and, in all material respects, to own
its properties and conduct its business as such properties are
presently owned and as such business is presently conducted.
(b) Due Qualification. The Servicer is duly qualified
to do business and is in good standing as a foreign corporation (or
is exempt from such requirements), and has obtained all necessary
licenses and approvals in each jurisdiction in which failure to so
qualify or to obtain such licenses and approvals would have a
material adverse effect on the interests of the Investor
Certificateholders hereunder or under any Supplement.
(c) Due Authorization. The execution, delivery, and
performance of this Agreement and each Supplement have been duly
authorized by the Servicer by all necessary corporate action on the
part of the Servicer.
(d) Binding Obligation. This Agreement and each
Supplement constitutes a legal, valid and binding obligation of the
Servicer, enforceable in accordance with its terms, except as
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereinafter
in effect, affecting the enforcement of creditors' rights in general
(or with respect to such Successor Servicer, such other corporate
entity as may be applicable) 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 Violation. The execution and delivery of this
Agreement and each Supplement by the Servicer, the performance of the
transactions contemplated by this Agreement and each Supplement and
the fulfillment of the terms hereof and thereof applicable to the
Servicer, will not conflict with, violate, 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 default under, any
Requirement of Law applicable to the Servicer or any indenture,
contract, agreement, mortgage, deed of trust or other instrument to
which the Servicer is a party or by which it or any of 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 court, regulatory body,
administrative agency or other tribunal or governmental
instrumentality seeking to prevent the issuance of the Certificates
or the consummation of any of the transactions contemplated by this
Agreement or any Supplement, seeking any determination or ruling
that, in the reasonable judgment of the Servicer, would materially
and adversely affect the performance by the Servicer of its
obligations under this Agreement or any Supplement, or seeking any
determination or ruling that would materially and adversely affect
the validity or enforceability of this Agreement or any Supplement.
(g) Compliance with Requirements of Law. The Servicer
shall duly satisfy all obligations on its part to be fulfilled under
or in connection with the Receivables and the related Accounts, will
maintain in effect all qualifications required under Requirements of
Law in order to properly service the Receivables and the related
Accounts and will comply in all material respects with all other
Requirements of Law in connection with servicing the Receivables and
the related Accounts, the failure to comply with which would have a
material adverse effect on the interests of the Investor
Certificateholders.
(h) No Rescission or Cancellation. Subject to Section
3.09, the Servicer shall not permit any rescission or cancellation of
a Receivable except as ordered by a court of competent jurisdiction
or other Governmental Authority or in the ordinary course of its
business and in accordance with the Account Guidelines.
(i) Protection of Certificateholders' Rights. The
Servicer shall take no action that, nor omit to take any action the
omission of which, would substantially impair the rights of
Certificateholders in any Receivable or Account, nor shall it, except
in the ordinary course of its business and in accordance with the
Account Guidelines, reschedule, revise or defer Collections due on
the Receivables.
(j) Receivables Not To Be Evidenced by Promissory
Notes. Except in connection with its enforcement or collection of an
Account, the Servicer will take no action to cause any Receivable to
be evidenced by any instrument, other than an instrument that, taken
together with one or more other writings, constitutes chattel paper
(as such terms are defined in the UCC) and, if any Receivable is so
evidenced (whether or not in connection with the enforcement or
collection of an Account), it shall be reassigned or assigned to the
Servicer as provided in this Section.
(k) All Consents Required. All approvals,
authorizations, consents, orders or other actions of any Person or of
any governmental body or official required in connection with the
execution and delivery by the Servicer of this Agreement and each
Supplement, the performance by the Servicer of the transactions
contemplated by this Agreement and each Supplement and the
fulfillment by the Servicer of the terms hereof and thereof, have
been obtained; provided, however, that the Servicer makes no
representation or warranty regarding state securities or "blue sky"
laws in connection with the distribution of the Certificates.
(l) Maintenance of Records and Books of Account. The
Servicer shall maintain and implement administrative and operating
procedures (including 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, computer
records and other information, reasonably necessary or advisable for
the collection of all the Receivables. Such documents, books and
computer records shall reflect all facts giving rise to the
Receivables, all payments and credits with respect thereto, and such
documents, books and computer records shall indicate the interests of
the Trust in the Receivables.
For purposes of the representations and warranties set forth in
this Section 3.03, each reference to a Supplement shall be deemed to refer
only to those Supplements in effect as of the relevant Closing Date or the
date of appointment of a Successor Servicer, as applicable.
If any of the representations, warranties or covenants of the
Servicer contained in paragraph (g), (h), (i) or (j) with respect to any
Receivable or the related Account is breached, and as a result of such
breach the Trust's rights in, to or under any Receivables in the related
Account or the proceeds of such Receivables are impaired or such proceeds
are not available for any reason to the Trust free and clear of any Lien,
then no later than the expiration of 60 days (or such longer period, not in
excess of 150 days, as may be agreed to by the Trustee) from the earlier to
occur of the discovery of such event by the Servicer, or receipt by the
Servicer of notice of such event given by the Trustee, all Receivables in
the Account or Accounts to which such event relates shall be assigned to
the Servicer on the terms and conditions set forth below; provided,
however, that such Receivables will not be assigned to the Servicer if, on
any day prior to the end of such 60day or longer period, (i) the relevant
representation and warranty shall be true and correct, or the relevant
covenant shall have been complied with, in all material respects and
(ii) the Servicer shall have delivered an Officer's Certificate describing
the nature of such breach and the manner in which such breach was cured.
The Servicer shall effect such assignment by making a deposit
into the Collection Account in immediately available funds prior to the
next succeeding Business Day in an amount equal to the amount of such
Receivables, which deposit shall be considered a Collection with respect to
such Receivables and shall be applied in accordance with Article IV and the
terms of each Supplement.
Upon each such assignment to the Servicer, the Trustee, on
behalf of the Trust, shall automatically and without further action be
deemed to sell, transfer, assign, set over and otherwise convey to the
Servicer, without recourse, representation or warranty, all right, title
and interest of the Trust in and to such Receivables, all moneys due or to
become due and all amounts received with respect thereto and all proceeds
thereof. The Trustee shall execute such documents and instruments of
transfer or assignment and take such other actions as shall be reasonably
requested by the Servicer to effect the conveyance of any such Receivables
pursuant to this Section. The obligation of the Servicer to accept
assignment of such Receivables, and to make the deposits, if any, required
to be made to the Excess Funding Account or the Collection Account as
provided in the preceding paragraph, shall constitute the sole remedy
respecting the event giving rise to such obligation available to
Certificateholders (or the Trustee on behalf of Certificateholders) or any
Series Enhancer, except as provided in Section 8.04.
Section 3.04 Reports for the Trustee.
(a) Daily Reports; Adjustments. On each Business Day,
the Servicer shall prepare and make available at the office of the
Servicer for inspection by the Trustee a report (the "Daily Report")
that shall:
(i) set forth (x) the aggregate amount of
Collections processed by the Servicer on the second preceding
Business Day, (y) the amount on deposit in the Excess Funding
Account on the second preceding Business Day and (z) a
calculation of the Retained Interest and the Required Retained
Interest on the second preceding Business Day and a
determination of whether the Retained Interest on the second
preceding Business Day was greater than the Required Retained
Interest on such Business Day and such other information as may
be specified in any applicable Supplement; and
(ii) allocate for such second preceding Business
Day in the manner specified below, (x) the aggregate amount of
Collections processed by the Servicer with respect to Principal
Receivables and (y) the aggregate amount of Collections
processed by the Servicer with respect to Finance Charge
Receivables.
The estimate of the aggregate amount of Collections processed by the
Servicer with respect to Principal Receivables required by paragraph
(ii) above shall equal the product of (a) the Collections and (b) a
fraction, the numerator of which shall be the aggregate amount of
Collections of Principal Receivables as of the last day of the preceding
Monthly Period and the denominator of which shall be the aggregate amount
of Collections as of such last day. The estimate of the aggregate amount
of Collections processed by the Servicer with respect to Finance Charge
Receivables required by paragraph (ii) above shall equal the product of
(a) the Collections and (b) a fraction, the numerator of which shall be the
aggregate amount of Collections of Finance Charge Receivables and Discount
Option Receivables as of the last day of the preceding Monthly Period and
the denominator of which shall be the aggregate amount of Collections as of
such last day. On the Determination Date following each Monthly Period
during which the foregoing methods of estimating shall have been used by
the Servicer, the Servicer shall make an appropriate "true-up" adjustment
of the aggregate amounts allocated as Collections of Principal Receivables
and Finance Charge Receivables in the Collection Account for such Monthly
Period pursuant to paragraph (ii) above to the actual amount of Collections
on Principal Receivables included in the Trust Assets, the amount of
Discount Option Receivables allocable to the Certificate Rate for such
Monthly Period, and the actual amount of Collections on Finance Charge
Receivables included in the Trust Assets, in each case, to reflect the
difference between (x) the amounts that should have been recorded as
Collections in respect of Principal Receivables and Finance Charge
Receivables if actual Collections of Principal Receivables and Finance
Charge Receivables had been known and (y) the amount allocated thereto
pursuant to the preceding sentence.
(b) Monthly Servicer's Certificate. Unless otherwise
stated in the Supplement related to any Series, on each Determination
Date, the Servicer shall forward to the Trustee, the Paying Agent,
each Rating Agency and each Series Enhancer a certificate of a
Servicing Officer setting forth (i) the aggregate amounts for the
preceding Monthly Period with respect to each of the items specified
in clauses (i)(x) and (ii)(y) of subsection 3.04(a), together with
the amount and nature of any "true-up" adjustment required by Section
3.04(a), (ii) the Defaulted Amount for the preceding Monthly Period,
(iii) Recoveries for the preceding Monthly Period, (iv) a calculation
of the Portfolio Yield and Base Rate for each Series then
outstanding, (v) the aggregate amount of Receivables and the balance
on deposit in the Collection Account (or any subaccount thereof) or
any Series Account applicable to any Series then outstanding with
respect to Collections processed as of the end of the last day of the
preceding Monthly Period, (vi) the aggregate amount of adjustments
from the preceding Monthly Period, (vii) the aggregate amount, if
any, of withdrawals, drawings or payments under any Series
Enhancement with respect to each Series required to be made with
respect to the previous Monthly Period, (viii) the sum of all amounts
payable to the Investor Certificateholders on the succeeding
Distribution Date in respect of interest and principal payable with
respect to the Investor Certificates and (ix) such other amounts,
calculations, and/or information as may be required by any relevant
Supplement.
(c) Transferred Accounts. The Servicer covenants and
agrees hereby to deliver to the Trustee, within a reasonable time
period after any Transferred Account is created, but in any event not
later than 15 days after the end of the month within which the
Transferred Account is created, a notice specifying the new account
number for any Transferred Account and the replaced account number.
Annual Certificate of Servicer
. The Servicer shall deliver to the Trustee, each Rating
Agency and each Series Enhancer entitled thereto pursuant to the relevant
Supplement, on or before October 31 of each calendar year, beginning with
October 31, 1995, an Officer's Certificate (with appropriate insertions)
substantially in the form of Exhibit D.
Annual Servicing Report of Independent Public Accountants;
Copies of Reports Available
(a) . (a) On or before October 31 of each calendar
year, beginning with October 31, 1995, the Servicer shall cause a
firm of nationally recognized independent public accountants (who may
also render other services to the Servicer or the Seller) to furnish
a report (addressed to the Trustee) to the Trustee, the Servicer and
each Rating Agency to the effect that they have applied certain
procedures agreed upon with the Servicer and examined certain
documents relating to the servicing of Accounts under this Agreement
and each Supplement and that, on the basis of such agreed upon
procedures, such firm is of the opinion that the system of internal
accounting controls in effect on the date of such statement relating
to the servicing procedures performed by the Servicer under this
Agreement, taken as a whole, was sufficient for the prevention and
detection of errors and irregularities that would be material to the
assets of the Trust and such servicing procedures have been conducted
in compliance with the terms and conditions set forth in Article III
and Article IV and Section 8.08 of this Agreement and the applicable
provisions of each Supplement, except for such exceptions as they
believe to be immaterial and such other exceptions as shall be set
forth in such statement. Such report shall set forth the agreed upon
procedures performed. A copy of such report shall be delivered to
each Series Enhancer entitled thereto pursuant to the relevant
Supplement.
(b) On or before October 31 of each calendar year,
beginning with October 31, 1995, the Servicer shall cause a firm of
nationally recognized independent public accountants (who may also
render other services to the Servicer or the Seller) to furnish a
report to the Trustee, the Servicer and each Rating Agency to the
effect that they have applied certain procedures agreed upon with the
Servicer to compare the mathematical calculations of certain amounts
set forth in the Servicer's Certificates delivered pursuant to
Section 3.04(b) during the period covered by such report with the
Servicer's computer reports that were the source of such amounts and
that on the basis of such agreed upon procedures and comparison, such
accountants are of the opinion that such amounts are in agreement,
except for such exceptions as they believe to be immaterial and such
other exceptions as shall be set forth in such statement. A copy of
such report shall be delivered to each Series Enhancer entitled
thereto pursuant to the relevant Supplement.
(c) A copy of each certificate and report provided
pursuant to Section 3.04(b), 3.05 or 3.06 may be obtained by any
Investor Certificateholder or Certificate Owner by a request to the
Trustee addressed to the Corporate Trust Office.
Tax Treatment
. The Seller has entered into this Agreement, and the
Certificates will be issued with the intention that, for Federal, state and
local income and franchise tax purposes, the Investor Certificates (except
Seller Retained Certificates that are held by the Seller) of each Series
will qualify as debt secured by the Receivables. The Seller, by entering
into this Agreement, each Certificateholder, by the acceptance of its
Certificate (and each Certificate Owner, by its acceptance of an interest
in the applicable Certificate), agree to treat such Investor Certificates
for Federal, state and local income and franchise tax purposes as debt.
Each Holder of such Investor Certificate agrees that it will cause any
Certificate Owner acquiring an interest in a Certificate through it to
comply with this Agreement as to treatment as debt under applicable tax
law, as described in this Section 3.07. Furthermore, subject to Section
11.11, the Trustee shall treat the Trust as a security device only, and
shall not file tax returns or obtain an employer identification number on
behalf of the Trust.
Notices to The Neiman Marcus Group, Inc
. If The Neiman Marcus Group, Inc. is no longer acting as
Servicer, any Successor Servicer shall deliver to The Neiman Marcus Group,
Inc. each certificate and report required to be provided thereafter
pursuant to Section 3.04(b), 3.05 or 3.06.
Adjustments
(a) . (a) If the Servicer adjusts downward the amount
of any Receivable because of a rebate, refund, unauthorized charge or
billing error to an accountholder, or because such Receivable was
created in respect of merchandise that was refused or returned by an
accountholder, or if the Servicer otherwise adjusts downward the
amount of any Receivable without receiving Collections therefor or
charging off such amount as uncollectible, then, in any such case,
the amount of Principal Receivables used to calculate the Seller's
Interest, the Floating Allocation Percentage and the Principal
Allocation Percentage applicable to any Series will be reduced by the
amount of the adjustment. Similarly, the amount of Principal
Receivables used to calculate the Seller's Interest, the Floating
Allocation Percentage and the Principal Allocation Percentage
applicable to any Series will be reduced by the amount of any
Principal Receivable that was discovered as having been created
through a fraudulent or counterfeit charge or with respect to which
the covenant of the Seller contained in Section 2.07(b) has been
breached. Any adjustment required pursuant to either of the two
preceding sentences shall be made on or prior to the end of the
Monthly Period in which such adjustment obligation arises. If,
following the exclusion of such Principal Receivables from the
calculation of the Seller's Interest, the Seller's Interest would be
less than the Required Seller's Interest, not later than 12:00 noon,
New York City time, on the Distribution Date following the Monthly
Period in which such adjustment obligation arises, the Seller shall
make a deposit into the Excess Funding Account in immediately
available funds in an amount equal to the amount by which the
Seller's Interest would be less than the Required Seller's Interest
(up to the amount of such Principal Receivables). Any amount
deposited into the Excess Funding Account pursuant to the preceding
sentence shall be considered Collections of Principal Receivables and
shall be applied in accordance with Article IV and the terms of each
Supplement.
(b) If (i) the Servicer makes a deposit into the
Collection Account in respect of a Collection of a Receivable and
such Collection was received by the Servicer in the form of a check
that is not honored for any reason or (ii) the Servicer makes a
mistake with respect to the amount of any Collection and deposits an
amount that is less than or more than the actual amount of such
Collection, the Servicer shall appropriately adjust the amount
subsequently deposited into the Collection Account to reflect such
dishonored check or mistake. Any Receivable in respect of which a
dishonored check is received shall be deemed not to have been paid.
Notwithstanding the first two sentences of this paragraph, any
adjustments made pursuant to this paragraph will be reflected in a
current report but will not change any amount of Collections
previously reported pursuant to subsection 3.04(b).
Reports to the Commission
. The Servicer shall, on behalf of the Trust, cause to be
filed with the Commission any periodic reports required to be filed under
the provisions of the Securities Exchange Act of 1934, as amended, and the
rules and regulations of the Commission thereunder. The Seller shall, at
the expense of the Servicer, cooperate in any reasonable request of the
Servicer in connection with such filings.
ARTICLE IV
Rights of Certificateholders andAllocation and Application of Collections
Rights of Certificateholders
. The Investor Certificates shall represent fractional
undivided interests in the Trust, that, with respect to each Series, 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 such Supplement, funds on deposit in
the Collection Account allocable to Certificateholders of such Series
pursuant to this Agreement and such Supplement, funds on deposit in any
related Series Account and funds available pursuant to any related Series
Enhancement (collectively, with respect to all Series, the
"Certificateholders' Interest"), it being understood that, unless otherwise
specified in the Supplement with respect to such Series, the Investor
Certificates of any Series or Class shall not represent any interest in any
Series Account or Series Enhancement for the benefit of any other Series or
Class. The Seller Certificate shall represent the ownership interest in
the remainder of the Trust Assets not allocated pursuant to this Agreement
or any Supplement to the 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 any Supplement
to be paid to the Seller on behalf of the Holder of the Seller Certificate
(the "Seller's Interest"); provided, however, that the Seller Certificate
shall not represent any interest in the Collection Account, any Series
Account or any Series Enhancement, except as specifically provided in this
Agreement or any Supplement.
Establishment of Collection Account and Excess Funding Account
. The Servicer, for the benefit of the Certificateholders,
shall establish and maintain in the name of the Trustee, on behalf of the
Trust, an Eligible Deposit Account bearing a designation clearly indicating
that the funds deposited therein are held for the benefit of the
Certificateholders (the "Collection Account"). The Collection Account
shall initially be established with the Trustee. The Trustee shall possess
all right, title and interest in all funds on deposit from time to time in
the Collection Account and in all proceeds thereof for the benefit of the
Certificateholders. The Collection 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
Collection Account for any amount owed to it by the Trustee, the Trust, any
Certificateholder or any Series Enhancer. If at any time the Collection
Account ceases to be an Eligible Deposit Account, the Trustee (or the
Servicer on its behalf) shall within 10 Business Days (or such longer
period, not to exceed 30 calendar days, as to which each Rating Agency may
consent) establish a new Collection Account meeting the conditions
specified above, transfer any cash or any investments to such new
Collection Account and from the date such new Collection Account is
established, it shall be the "Collection Account".
Funds on deposit in the Collection Account (other than amounts
deposited pursuant to Section 2.06, 10.01 or 12.02) shall at the direction
of the Servicer be invested by the Trustee in Eligible Investments selected
by the Servicer. All such Eligible Investments shall be held by the
Trustee for the benefit of the Certificateholders. The Trustee shall
maintain for the benefit of the Certificateholders possession of the
negotiable instruments or securities, if any, evidencing such Eligible
Investments. Investments of funds representing Collections collected
during any Monthly Period shall be invested in Eligible Investments that
will mature so that all funds will be available at the close of business on
the Transfer Date following such Monthly Period. No Eligible Investment
shall be disposed of prior to its maturity; provided, however, that the
Trustee may sell, liquidate or dispose of an Eligible Investment before its
maturity, at the written direction of the Servicer, if such sale,
liquidation or disposal would not result in a loss of all or part of the
principal portion of such Eligible Investment or if, prior to the maturity
of such Eligible Investment, a default occurs in the payment of principal,
interest or any other amount with respect to such Eligible Investment. On
each Distribution Date, all interest and other investment earnings (net of
losses and investment expenses) on funds on deposit in the Collection
Account shall be treated as Collections of Finance Charge Receivables with
respect to the last day of the related Monthly Period, except as otherwise
specified in any Supplement. For purposes of determining the availability
of funds or the balances in the Collection Account for any reason under
this Agreement, all investment earnings net of investment expenses and
losses on such funds shall be deemed not to be available or on deposit.
The Servicer, for the benefit of the Certificateholders, shall
establish and maintain in the name of the Trustee, on behalf of the Trust,
an Eligible Deposit Account bearing a designation clearly indicating that
the funds deposited therein are held for the benefit of the
Certificateholders (the "Excess Funding Account"). The Excess Funding
Account shall initially be established with the Trustee. The Trustee shall
possess all right, title and interest in all funds on deposit from time to
time in the Excess Funding Account and in all proceeds thereof. The Excess
Funding 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 Excess Funding Account for any amount owed to it by the
Trustee, the Trust, any Certificateholder or any Series Enhancer. If, at
any time, the Excess Funding Account ceases to be an Eligible Deposit
Account, the Trustee (or the Servicer on its behalf) shall within 10
Business Days (or such longer period, not to exceed 30 calendar days, as to
which each Rating Agency may consent) establish a new Excess Funding
Account meeting the conditions specified above, transfer any cash or any
investments to such new Excess Funding Account and from the date such new
Excess Funding Account is established, it shall be the "Excess Funding
Account".
Funds on deposit in the Excess Funding Account shall at the
direction of the Servicer be invested by the Trustee in Eligible
Investments selected by the Servicer. All such Eligible Investments shall
be held by the Trustee for the benefit of the Certificateholders. The
Trustee shall maintain for the benefit of the Certificateholders possession
of the negotiable instruments or securities, if any, evidencing such
Eligible Investments. Funds on deposit in the Excess Funding Account on
any Distribution Date will be invested in Eligible Investments that will
mature so that all funds will be available at the close of business on the
Transfer Date following such Monthly Period. No Eligible Investment shall
be disposed of prior to its maturity; provided, however, that the Trustee
may sell, liquidate or dispose of an Eligible Investment before its
maturity, at the written direction of the Servicer, if such sale,
liquidation or disposal would not result in a loss of all or part of the
principal portion of such Eligible Investment or if, prior to the maturity
of such Eligible Investment, a default occurs, in the payment of principal,
interest or any other amount with respect to such Eligible Investment.
Unless directed by the Servicer, funds deposited in the Excess Funding
Account on a Transfer 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) on funds on deposit in the Excess Funding Account shall be
treated as Collections of Finance Charge Receivables with respect to the
last day of the related Monthly Period except as otherwise specified in the
related Supplement. Unless otherwise directed by the Servicer, funds on
deposit in the Excess Funding Account will be withdrawn and paid to the
Holder of the Seller Certificate on any Distribution Date to the extent
that (x) the Seller's Interest exceeds the Required Seller's Interest and
(y) the Retained Interest exceeds the Required Retained Interest on such
date. On any Transfer Date on which one or more Series is in an
Accumulation Period or Amortization Period, the Servicer shall determine
the aggregate amounts of Principal Shortfalls, if any, with respect to each
such Series that is a Principal Sharing Series (after giving effect to the
allocation and payment provisions in the Supplement with respect to each
such Series), and the Servicer shall instruct the Trustee to withdraw such
amount (up to the amount on deposit in the Excess Funding Account) on the
succeeding Distribution Date and allocate such amount among each such
Series as specified in each related Supplement; provided, however, that
funds shall only be withdrawn from the Excess Funding Account for
allocation to cover such Principal Shortfalls if, and to the extent, that
such allocation will not result in the reduction of (x) the Seller's
Interest to an amount below the Required Seller's Interest or (y) the
Retained Interest to an amount below the Required Retained Interest. For
purposes of determining the availability of funds or the balances in the
Excess Funding Account for any reason under this Agreement, all investment
earnings net of investment expenses and losses on such funds shall be
deemed not to be available or on deposit.
Collections and Allocations
(a) . (a) The Servicer will apply or will instruct
the Trustee to apply all funds on deposit in the Collection Account
as described in this Article IV and in each Supplement. Except as
otherwise provided below and in each Supplement, the Servicer shall
deposit Collections into the Collection Account no later than the
second Business Day following the Date of Processing of such
Collections. Subject to the express terms of any Supplement, but
notwithstanding anything else in this Agreement to the contrary, if
The Neiman Marcus Group, Inc. or an Affiliate of The Neiman Marcus
Group, Inc., remains the Servicer and (x) obtains and for so long as
it maintains a short term debt rating of A-1 or better by Standard &
Poor's and P-1 or better by Moody's (or such other rating below A-1
or P-1, as the case may be, that is satisfactory to each Rating
Agency), or (y) The Neiman Marcus Group, Inc. or such Affiliate has
provided to the Trustee a letter of credit covering collection risk
of the Servicer acceptable to each Rating Agency (as evidenced by a
letter from each Rating Agency to the effect that the Rating Agency
Condition has been satisfied), the Servicer need not make the daily
deposits of Collections into the Collection Account as provided in
the preceding sentence, but may make a single deposit in the
Collection Account in immediately available funds not later than
12:00 noon, New York City time, on the related Transfer Date.
(b) With respect to each day during each Monthly
Period, (i) Collections of Finance Charge Receivables will be
allocated to the Certificateholders' Interest of each Series, and
(ii) Collections of Principal Receivables will be allocated to the
Certificateholders' Interest of each Series, each as set forth in the
Supplement related to such Series.
On each Determination Date, (i) Collections of Recoveries will
be treated as Finance Charge Receivables and allocated to the
Certificateholders' Interest of each Series and (ii) Defaulted Receivables
will be allocated to the Certificateholders' Interest of each Series, each
as set forth in the related Supplement.
(c) Throughout the existence of the Trust, unless
otherwise stated in any Supplement, the Servicer shall allocate to
the Holder of the Seller Certificate an amount equal to the product
of (A) the Seller's Percentage and (B) the aggregate amount of such
Collections allocated to Principal Receivables and Finance Charge
Receivables, respectively, in respect of each Monthly Period.
Notwithstanding anything in this Agreement to the contrary, unless
otherwise stated in any Supplement, the Servicer need not deposit
this amount or any other amounts so allocated to the Seller
Certificate pursuant to any Supplement into the Collection Account
and shall pay, or be deemed to pay, such amounts as collected to the
Holder of the Seller Certificate.
The payments to be made to the Holder of the Seller Certificate
pursuant to this Section 4.03(c) do not apply to deposits to the Collection
Account or other amounts that do not represent Collections, including
payment of the purchase price for Receivables pursuant to Section 2.06 or
10.01, proceeds from the sale, disposition or liquidation of Receivables
pursuant to Section 12.02 or payment of the purchase price for the
Certificateholders' Interest of a specific Series pursuant to the related
Supplement.
Shared Principal Collections
. On each Distribution Date, (a) the Servicer shall allocate
Shared Principal Collections to each Principal Sharing Series, pro rata, in
proportion to the Principal Shortfalls, if any, with respect to each such
Series, and any remainder may, at the option of the Seller, be applied as
principal with respect to any Variable Funding Certificate and (b) the
Servicer shall withdraw from the Collection Account or the Excess Funding
Account and pay to the Holder of the Seller Certificate an amount equal to
the excess, if any, of (x) the aggregate amount for all outstanding Series
of Collections of Principal Receivables that the related Supplements or
this Agreement specify are to be treated as "Shared Principal Collections"
for such Distribution Date over (y) the aggregate amount for all
outstanding Principal Sharing Series that the related Supplements specify
are "Principal Shortfalls" for such Distribution Date; provided, however,
that such amounts shall be paid to the Holder of the Seller Certificate
only if the Seller's Interest for such Distribution Date (determined after
giving effect to any Principal Receivables transferred to the Trust on such
date) exceeds zero; and provided further that, if, on any Distribution Date
the Seller's Interest is less than or equal to the Required Seller's
Interest or the Retained Interest is less than or equal to the Required
Retained Interest, the Servicer will not distribute to the Holder of the
Seller Certificate any Shared Principal Collections that otherwise would be
distributed to the Holder of the Seller Certificate, but shall deposit such
funds in the Excess Funding Account.
Excess Finance Charge Collections
. On each Distribution Date, (a) the Servicer shall allocate
Excess Finance Charge Collections with respect to the Series in a Group to
each Series in such Group, pro rata, in proportion to the Finance Charge
Shortfalls, if any, with respect to each such Series and (b) the Servicer
shall withdraw (or shall instruct the Trustee to withdraw) from the
Collection Account and pay to the Holder of the Seller Certificate an
amount equal to the excess, if any, of (x) the aggregate amount for all
outstanding Series in a Group of the amounts that the related Supplements
specify are to be treated as "Excess Finance Charge Collections" for such
Distribution Date over (y) the aggregate amount for all outstanding Series
in such Group that the related Supplements specify are "Finance Charge
Shortfalls" for such Distribution Date; provided, however, that the sharing
of Excess Finance Charge Collections among Series in a Group will continue
only until such time, if any, at which the Seller shall deliver to the
Trustee an Officer's Certificate to the effect that, in the reasonable
belief of the Seller, the continued sharing of Excess Finance Charge
Collections among Series in any Group would have adverse regulatory
implications with respect to the Seller. Following the delivery by the
Seller of such an Officer's Certificate to the Trustee, there will not be
any further sharing of Excess Finance Charge Collections among Series in
any Group.
Allocations During Funding Period
. To the extent that the Servicer establishes an Eligible
Deposit Account as a pre-funding account (the "Pre-Funding Account") with
respect to any Series, bearing a designation indicating that the funds
deposited therein are for the benefit of such Series, during the period
(the "Funding Period"), as set forth in the related Supplement, that the
Pre-Funding Account maintains a balance, the date upon which an increase in
the Invested Amount of such Series in accordance with the terms of such
related Supplement occurs shall be treated as an Addition Date solely for
the purpose of calculating the Floating Allocation Percentage and the
Principal Allocation Percentage. Such Addition Date shall be deemed to
occur on the date of each such increase and the Floating Allocation
Percentage and Principal Allocation Percentage shall be calculated
accordingly.
ARTICLE V
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
The Certificates
. The Investor Certificates of any Series or Class may be
issued in bearer form ("Bearer Certificates") with attached interest
coupons and any other applicable coupon (collectively, the "Coupons") or in
fully registered form ("Registered Certificates") and shall be
substantially in the form of the exhibits with respect thereto attached to
the applicable Supplement. The Seller Certificate will be issued in
registered form, substantially in the form of Exhibit A, and shall upon
issue, be executed and delivered by the Seller to the Trustee for
authentication and redelivery as provided in Section 6.02. Except as
otherwise provided in Section 6.03 or in any Supplement, Bearer
Certificates shall be issued in minimum denominations of $5,000 and
Registered Certificates shall be issued in minimum denominations of $1,000
and in integral multiples of $1,000 in excess thereof. If specified in any
Supplement, the Investor Certificates of any Series or Class shall be
issued upon initial issuance as a single certificate evidencing the
aggregate original principal amount of such Series or Class as described in
Section 6.13. The Seller Certificate shall initially be a single
certificate and shall initially represent the entire Seller's Interest.
Each Certificate shall be executed by manual or facsimile signature on
behalf of the Seller by its President or any Vice President. Certificates
bearing the manual or facsimile signature of an individual who was, at the
time when such signature was affixed, authorized to sign on behalf of the
Seller 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
be valid for any purpose, unless there appears on such Certificate a
certificate of authentication substantially in the form provided for herein
executed by or on behalf of the Trustee by the manual signature of a duly
authorized signatory, and such certificate of authentication upon any
Certificate shall be conclusive evidence, and the only evidence, that such
Certificate has been duly authenticated and delivered hereunder. Bearer
Certificates shall be dated the Closing Date. All Registered Certificates
and the Seller Certificate shall be dated the date of their authentication.
Authentication of Certificates
. The Trustee shall authenticate and deliver the Investor
Certificates of each Series and Class that are issued upon original
issuance to or upon the order of the Seller against payment to the Seller
of the purchase price therefor. The Trustee shall authenticate and deliver
the Seller Certificate to the Seller simultaneously with its delivery of
the Investor Certificates of the first Series to be issued hereunder. If
specified in the related Supplement for any Series or Class, the Trustee
shall authenticate and deliver outside the United States the Global
Certificate that is issued upon original issuance thereof.
New Issuances
(a) . (a) The Seller may from time to time direct the
Trustee, on behalf of the Trust, to authenticate one or more new
Series of Investor Certificates. 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 or Class, as provided in the related Supplement.
(b) On or before the Closing Date relating to any new
Series, the parties hereto will execute and deliver a Supplement that
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 authenticate the Investor Certificates of such new Series and to
execute and deliver the related Supplement is subject to the
satisfaction of the following conditions; provided, however, that the
conditions set forth in clauses (i), (iii), (iv) and (v) shall not be
applicable to the issuance of the first Series of Investor
Certificates:
(i) on or before the fifth Business Day
immediately preceding the Closing Date, the Seller shall have
given the Trustee, the Servicer, each Rating Agency and any
Series Enhancer entitled thereto pursuant to the relevant
Supplement notice of such issuance and the Closing Date;
(ii) the Seller shall have delivered to the
Trustee the related Supplement, executed by each party hereto
other than the Trustee;
(iii) the Seller shall have delivered to the
Trustee any related Enhancement Agreement executed by each of
the parties thereto, other than the Trustee;
(iv) the Rating Agency Condition shall have been
satisfied with respect to such issuance;
(v) the Seller shall have delivered to the
Trustee and any Series Enhancer entitled thereto pursuant to
the relevant Supplement an Officer's Certificate, dated the
Series Issuance Date, to the effect that the Seller reasonably
believes that such issuance will not, based on the facts known
to such officer at the time of such certification, then or
thereafter cause a Pay Out Event to occur with respect to any
Series;
(vi) the Seller shall have delivered to the
Trustee and each Rating Agency a Tax Opinion, dated the Closing
Date, with respect to such issuance; and
(vii) the Retained Interest shall not be less than
the Required Retained Interest, and the Seller's Interest
(excluding the interest represented by any Supplemental
Certificate) shall not be less than the Required Seller's
Interest, in each case as of the Closing Date and after giving
effect to such issuance.
Upon satisfaction of the above conditions, the Trustee shall execute the
Supplement and authenticate the Investor Certificates of such Series upon
execution thereof by the Seller.
(c) The Seller may surrender the Seller Certificate to
the Trustee in exchange for a newly issued Seller Certificate and one
or more additional certificates (each a "Supplemental Certificate"),
the terms of which shall be defined in a Supplement (which Supplement
shall be subject to Section 13.01(a) to the extent that it amends any
of the terms of this Agreement), to be delivered to or upon the order
of the Seller (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 Retained Interest shall not be less than
the Required Retained Interest, and the Seller's Interest shall
not be less than the Required Seller's Interest, in each case
as of the date of, and after giving effect to, such exchange;
(ii) the Rating Agency Condition shall have been
satisfied with respect to such exchange (or transfer or
exchange as provided below); and
(iii) the Seller shall have delivered to the
Trustee and each Rating Agency a Tax Opinion, dated the date of
such exchange (or transfer or exchange as provided below), with
respect thereto.
Any Supplemental Certificate may be transferred or exchanged only upon
satisfaction of the conditions set forth in clauses (ii) and (iii) above.
(d) The Seller Certificate (or any interest therein)
may be transferred to a Person that is a member of the "affiliated
group" as defined in Code Section 1504(a) of which The Neiman Marcus
Group, Inc. is a member without the consent or approval of the
Holders of the Investor Certificates, provided that the Rating Agency
Condition shall have been satisfied with respect to such transfer and
the Seller shall have delivered to the Trustee and each Rating Agency
a Tax Opinion, dated the date of such transfer, with respect thereto.
In connection with any such transfer, the Seller may at its option
require that the Person to whom the Seller Certificate is transferred
will, by its acquisition and holding of an interest in the Seller
Certificate, assume all of the rights and obligations of the Seller
as described in this Agreement and in any Supplement or amendment
thereto (including the right under this subsection (d) with respect
to subsequent transfers of an interest in the Seller Certificate).
Registration of Transfer and Exchange of Certificates
(a) . (a) The Trustee shall cause to be kept at the
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 Registered Certificates and of transfers and exchanges of the
Registered Certificates as herein provided. The Transfer Agent and
Registrar shall initially be The Bank of New York (replacing The
Chase Manhattan Bank, N.A.) and any cotransfer agent and coregistrar
chosen by the Seller and acceptable to the Trustee, including, if and
so long as any Series or Class is listed on the Luxembourg Stock
Exchange and such exchange shall so require, a co-transfer agent and
coregistrar in Luxembourg; provided, however, that The Chase
Manhattan Bank shall continue to serve as Transfer Agent and
Registrar for the Trust's Series 1995-1 Certificates, and its rights,
duties and obligations in that capacity will continue to be governed
by the Existing Agreement. So long as any Investor Certificates are
outstanding, the Seller shall maintain a cotransfer agent and
coregistrar in New York City. Any reference in this Agreement to the
Transfer Agent and Registrar shall include any cotransfer agent and
co-registrar unless the context requires otherwise.
The Trustee may revoke such appointment and remove any Transfer
Agent and Registrar if the Trustee determines in its sole discretion that
such Transfer Agent and Registrar failed to perform its obligations under
this Agreement in any material respect. Any Transfer Agent and Registrar
shall be permitted to resign as Transfer Agent and Registrar upon 30 days'
notice to the Seller, the Trustee and the Servicer; provided, however, that
such resignation shall not be effective and such Transfer Agent and
Registrar shall continue to perform its duties as Transfer Agent and
Registrar until the Trustee has appointed a successor Transfer Agent and
Registrar reasonably acceptable to the Seller.
Subject to paragraph (c) below, upon surrender for registration
of transfer of any Registered Certificate at any office or agency of the
Transfer Agent and Registrar maintained for such purpose, one or more new
Registered Certificates (of the same Series and Class) in authorized
denominations of like aggregate fractional undivided interests in the
Certificateholders' Interest shall be executed, authenticated and
delivered, in the name of the designated transferee or transferees.
At the option of a Registered Certificateholder, Registered
Certificates (of the same Series and Class) may be exchanged for other
Registered Certificates of authorized denominations of like aggregate
fractional undivided interests in the Certificateholders' Interest, upon
surrender of the Registered Certificates to be exchanged at any such office
or agency; Registered Certificates, including Registered Certificates
received in exchange for Bearer Certificates, may not be exchanged for
Bearer Certificates. At the option of the Holder of a Bearer Certificate,
subject to applicable laws and regulations, Bearer Certificates may be
exchanged for other Bearer Certificates or Registered Certificates (of the
same Series and Class) of authorized denominations of like aggregate
fractional undivided interests in the Certificateholders' Interest, upon
surrender of the Bearer Certificates to be exchanged at an office or agency
of the Transfer Agent and Registrar located outside the United States.
Each Bearer Certificate surrendered pursuant to this Section shall have
attached thereto all unmatured Coupons; provided that any Bearer
Certificate, so surrendered after the close of business on the Record Date
preceding the relevant payment date or distribution date after the expected
final payment date need not have attached the Coupon relating to such
payment date or distribution date (in each case, as specified in the
applicable Supplement).
Whenever any Investor Certificates are so surrendered for
exchange, the Seller shall execute, the Trustee shall authenticate and the
Transfer Agent and Registrar shall deliver (in the case of Bearer
Certificates, outside the United States) the Investor Certificates that the
Investor Certificateholder making the exchange is entitled to receive.
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 Investor Certificateholder or the attorney-
in-fact thereof duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange of Investor Certificates, but the Transfer Agent and
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any such
transfer or exchange.
All Investor Certificates (together with any Coupons)
surrendered for registration of transfer and exchange or for payment shall
be canceled and disposed of in a manner satisfactory to the Trustee. The
Trustee shall cancel and destroy any Global Certificate upon its exchange
in full for Definitive Euro-Certificates and shall deliver a certificate of
destruction to the Seller. Such certificate shall also state that a
certificate or certificates of a Foreign Clearing Agency to the effect
referred to in Section 6.13 was received with respect to each portion of
the Global Certificate exchanged for Definitive Euro-Certificates.
The Seller shall execute and deliver to the Trustee Bearer
Certificates and Registered Certificates in such amounts and at such times
as are necessary to enable the Trustee to fulfill its responsibilities
under this Agreement, each Supplement and the Certificates.
(b) The Transfer Agent and Registrar will maintain at
its expense in the City of New York, and, if and so long as any
Series or Class is listed on the Luxembourg Stock Exchange,
Luxembourg, an office or agency where Investor Certificates may be
surrendered for registration of transfer or exchange (except that
Bearer Certificates may not be surrendered for exchange at any such
office or agency in the United States).
(i)
(i) Registration of transfer of Investor
Certificates containing (x) a legend substantially to the
effect set forth on Exhibit E1-A shall be effected only if such
transfer is made pursuant to an effective registration
statement under the Act or is exempt from the registration
requirements under the Act and (y) a legend substantially to
the effect set forth on Exhibit E-1-B shall be effected only if
such transfer is made to a Person that is not (1) an employee
benefit plan or other plan, trust or account (including an
individual retirement account) that is subject to ERISA or
Section 4975 of the Code or (2) any collective investment fund,
insurance company separate or general account or other entity
(except an entity registered under the Investment Company Act
of 1940, as amended) whose underlying assets include "plan
assets" under ERISA by reason of a plan's investment in such
entity (a "Benefit Plan"). In the event that registration of a
transfer is to be made in reliance upon an exemption from the
registration requirements under the Act, the transferor or the
transferee shall deliver, at its expense, to the Seller, the
Servicer and the Trustee, an investment letter from the
transferee, substantially in the form of the investment
representation letter attached hereto as Xxxxxxx X0, and no
registration of transfer shall be made until such letter is so
delivered.
Investor Certificates issued upon registration or transfer of,
or Investor Certificates issued in exchange for, Investor Certificates
bearing the legend referred to above shall also bear such legend unless the
Seller, the Servicer, the Trustee and the Transfer Agent and Registrar
receive an opinion of counsel, satisfactory to each of them, to the effect
that such legend may be removed.
Whenever an Investor Certificate containing the legend referred
to above is presented to the Transfer Agent and Registrar for registration
of transfer, the Transfer Agent and Registrar shall promptly seek
instructions from the Servicer regarding such transfer and shall be
entitled to receive instructions signed by a Servicing Officer prior to
registering any such transfer. The Seller hereby agrees to indemnify the
Transfer Agent and Registrar and the Trustee and to hold each of them
harmless against any loss, liability or expense incurred without negligence
or bad faith on their part arising out of or in connection with actions
taken or omitted by them in relation to any such instructions furnished
pursuant to this clause (i).
(ii) Registration of transfer of Investor
Certificates containing a legend to the effect set forth on
Exhibit E3 shall be effected only if such transfer is made to a
Person that is not a Benefit Plan. By accepting and holding
any such Investor Certificate, an Investor Certificateholder
shall be deemed to have represented and warranted that it is
not a Benefit Plan. By acquiring any interest in a Book-Entry
Certificate that contains such legend, a Certificate Owner
shall be deemed to have represented and warranted that it is
not a Benefit Plan.
(iii) If so requested by the Seller, the Trustee
will make available to any prospective purchaser of Investor
Certificates who so requests, a copy of a letter provided to
the Trustee by or on behalf of the Seller relating to the
transferability of any Series or Class to a Benefit Plan.
Mutilated, Destroyed, Lost or Stolen Certificates
. If (a) any mutilated Certificate (together, in the case of
Bearer Certificates, with all unmatured Coupons (if any) appertaining
thereto) 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 and the Trustee such security or indemnity
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 by
a bona fide purchaser, the Seller shall execute, the Trustee shall
authenticate and the Transfer Agent and Registrar shall deliver (in the
case of Bearer Certificates, outside the United States), in exchange for or
in lieu of any such mutilated, destroyed, lost or stolen Certificate, a new
Certificate of like tenor and aggregate fractional undivided interest. In
connection with the issuance of any new Certificate under this Section, the
Trustee or the Transfer Agent and Registrar may require the payment by the
Certificateholder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee and Transfer Agent
and Registrar) connected therewith. Any duplicate Certificate issued
pursuant to this Section 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.
Persons Deemed Owners
. The Trustee, the Paying Agent, the Transfer Agent and
Registrar and any agent of any of these may (a) prior to due presentation
of a Registered Certificate for registration of transfer, treat the Person
in whose name any Registered Certificate is registered as the owner of such
Registered Certificate for the purpose of receiving distributions pursuant
to the terms of the applicable Supplement and for all other purposes
whatsoever, and (b) treat the bearer of a Bearer Certificate or Coupon as
the owner of such Bearer Certificate or Coupon for the purpose of receiving
distributions pursuant to the terms of the applicable Supplement and for
all other purposes whatsoever; and, in any such case, neither the Trustee,
the Paying Agent, the Transfer Agent and Registrar nor any agent of any of
these shall be affected by any notice to the contrary. Notwithstanding the
foregoing, in determining whether the Holders of the requisite Investor
Certificates have given any request, demand, authorization, direction,
notice, consent or waiver hereunder, Certificates owned by the Seller, the
Servicer, any other Holder of the Seller Certificate, the Trustee 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 that the Trustee actually knows to be
so owned shall be so disregarded. Certificates so owned that 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 Seller, the Servicer, any other Holder of the Seller
Certificate or any Affiliate thereof.
Appointment of Paying Agent
. The Paying Agent shall make distributions to Investor
Certificateholders from the Collection Account or any applicable Series
Account pursuant to the provisions of the applicable Supplement and shall
report the amounts of such distributions to the Trustee. Any Paying Agent
shall have the revocable power to withdraw funds from the Collection
Account or any applicable Series Account for the purpose of making the
distributions referred to above. The Trustee may revoke such power and
remove the Paying Agent if the Trustee determines in its sole discretion
that the Paying Agent shall have failed to perform its obligations under
this Agreement or any Supplement in any material respect. The Paying Agent
shall initially be The Bank of New York and any copaying agent chosen by
the Seller and acceptable to the Trustee, including, if and so long as any
Series or Class is listed on the Luxembourg Stock Exchange and such
exchange so requires, a copaying agent in Luxembourg or another western
European city; provided, however, that The Chase Manhattan Bank shall
continue to serve as Paying Agent for the Trust's Series 1995-1
Certificates, and its rights, duties and obligations in that capacity will
continue to be governed by the Existing Agreement. Any Paying Agent shall
be permitted to resign as Paying Agent upon 30 days' notice to the Trustee.
In the event that any Paying Agent shall resign, the Trustee shall appoint
a successor to act as Paying Agent. The Trustee shall cause each successor
or additional Paying Agent to execute and deliver to the Trustee an
instrument in which such successor or additional Paying Agent shall agree
with the Trustee that it will hold all sums, if any, held by it for payment
to the Investor Certificateholders in trust for the benefit of the Investor
Certificateholders entitled thereto until such sums shall be paid to such
Investor Certificateholders. The Paying Agent shall return all unclaimed
funds to the Trustee and upon removal shall also return all funds in its
possession to the Trustee. The provisions of Sections 11.01, 11.02, 11.03
and 11.05 shall apply to the Trustee also in its role as Paying Agent, for
so long as the Trustee shall act as Paying Agent. Any reference in this
Agreement to the Paying Agent shall include any copaying agent unless the
context requires otherwise.
Access to List of Registered Certificateholders' Names and
Addresses
. The Trustee will furnish or cause to be furnished by the
Transfer Agent and Registrar to the Servicer or the Paying Agent, within
five Business Days after receipt by the Trustee of a request therefor, a
list in such form as the Servicer or the Paying Agent may reasonably
require, of the names and addresses of the Registered Certificateholders.
If any Holder or group of Holders of Investor Certificates of any Series or
all outstanding Series, as the case may be, evidencing not less than 10% of
the aggregate unpaid principal amount of such Series or all outstanding
Series, as applicable (the "Applicants"), apply to the Trustee, and such
application states that the Applicants desire to communicate with other
Investor Certificateholders with respect to their rights under this
Agreement or any Supplement or under the Investor Certificates and is
accompanied by a copy of the communication that such Applicants propose to
transmit, then the Trustee, after having been adequately indemnified by
such Applicants for its costs and expenses shall afford or shall cause the
Transfer agent and Registrar to afford such Applicants access during normal
business hours to the most recent list of Registered Certificateholders of
such Series or all outstanding Series, as applicable, held by the Trustee,
within five Business Days after the receipt of such application. Such list
shall be as of a date no more than 45 days prior to the date of receipt of
such Applicants' request.
Every Registered Certificateholder, by receiving and holding a
Registered Certificate, agrees with the Trustee that neither the Trustee,
the Transfer Agent and Registrar, 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 Registered Certificateholders hereunder,
regardless of the sources from which such information was derived.
Authenticating Agent
(a) . (a) The Trustee may appoint one or more
authenticating agents with respect to the Certificates that 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 certificate of authentication executed on behalf of the Trustee
by an authenticating agent. Each authenticating agent must be
acceptable to the Seller 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. An authenticating agent may at any time resign by giving
notice of resignation to the Trustee and to the Seller. 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
Seller. 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 Seller, the Trustee
promptly may appoint a successor authenticating agent. Any successor
authenticating agent upon acceptance of its appointment hereunder
shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
authenticating agent. No successor authenticating agent shall be
appointed unless acceptable to the Trustee and the Seller. The
Seller agrees to pay to each authenticating agent from time to time
reasonable compensation for its services under this Section. The
provisions of Sections 11.01, 11.02 and 11.03 shall be applicable to
any authenticating agent.
(c) Pursuant to an appointment made under this Section,
the Certificates may have endorsed thereon, in lieu of the Trustee's
certificate of authentication, an alternate certificate of
authentication in substantially the following form:
This is one of the Certificates described in the Pooling and
Servicing Agreement.
as Authenticating Agent for the Trustee,
By:
Authorized Officer
Book-Entry Certificates
. Unless otherwise specified in the related Supplement for any
Series or Class, the Investor Certificates, upon original issuance, shall
be issued in the form of one or more typewritten Investor Certificates
representing the Book-Entry Certificates, to be delivered to the Clearing
Agency, by, or on behalf of, the Seller. The Investor Certificates shall
initially be registered on the Certificate Register in the name of the
Clearing Agency or its nominee, and no Certificate Owner will receive a
definitive certificate representing such Certificate Owner's interest in
the Investor Certificates, except as provided in Section 6.12. Unless and
until definitive, fully registered Investor Certificates ("Definitive
Certificates") have been issued to the applicable Certificate Owners
pursuant to Section 6.12 or as otherwise specified in any such Supplement:
(a) the provisions of this Section shall be in full
force and effect;
(b) the Seller, the Servicer and the Trustee may deal
with the Clearing Agency and the Clearing Agency Participants for all
purposes (including the making of distributions) as the authorized
representatives of the respective Certificate Owners;
(c) to the extent that the provisions of this Section
conflict with any other provisions of this Agreement, the provisions
of this Section shall control; and
(d) the rights of the respective Certificate Owners
shall be exercised only through the Clearing Agency and the Clearing
Agency Participants and shall be limited to those established by law
and agreements between such Certificate Owners and the Clearing
Agency or the Clearing Agency Participants. Pursuant to the
Depository Agreement, unless and until Definitive Certificates are
issued pursuant to Section 6.12, the Clearing Agency will make book-
entry transfers among the Clearing Agency Participants and receive
and transmit distributions of principal and interest on the related
Investor Certificates to such Clearing Agency Participants.
For purposes of any provision of this Agreement requiring or
permitting actions with the consent of, or at the direction of, Investor
Certificateholders evidencing a specified percentage of the aggregate
unpaid principal amount of Investor Certificates, such direction or consent
may be given by Certificate Owners (acting through the Clearing Agency and
the Clearing Agency Participants) owning Investor Certificates evidencing
the requisite percentage of principal amount of Investor Certificates.
Notices to Clearing Agency
. Whenever any notice or other communication is required to be
given to Investor Certificateholders of any Series or Class with respect to
which Book-Entry Certificates have been issued, unless and until Definitive
Certificates shall have been issued to the related Certificate Owners, the
Trustee shall give all such notices and communications to the applicable
Clearing Agency.
Definitive Certificates
. If Book-Entry Certificates have been issued with respect to
any Series or Class and (a) the Seller advises the Trustee that the
Clearing Agency is no longer willing or able to discharge properly its
responsibilities under the Depository Agreement with respect to such Series
or Class and the Trustee or the Seller is unable to locate a qualified
successor, (b) the Seller, at its option, advises the Trustee that it
elects to terminate the book-entry system with respect to such Series or
Class through the Clearing Agency or (c) after the occurrence of a Servicer
Default, Certificate Owners of such Series or Class evidencing not less
than 50% of the aggregate unpaid principal amount of such Series or Class
advise the Trustee and the Clearing Agency through the Clearing Agency
Participants that the continuation of a book-entry system with respect to
the Investor Certificates of such Series or Class through the Clearing
Agency is no longer in the best interests of the Certificate Owners with
respect to such Certificates, then the Trustee shall notify all Certificate
Owners of such Certificates, through the Clearing Agency, of the occurrence
of any such event and of the availability of Definitive Certificates to
Certificate Owners requesting the same. Upon surrender to the Trustee of
any such Certificates by the Clearing Agency, accompanied by registration
instructions from the Clearing Agency for registration, the Seller shall
execute and the Trustee shall authenticate and deliver such Definitive
Certificates. Neither the Seller nor the Trustee shall be liable for any
delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of
such Definitive Certificates all references herein to obligations imposed
upon or to be performed by the Clearing Agency shall be deemed to be
imposed upon and performed by the Trustee, to the extent applicable with
respect to such Definitive Certificates and the Trustee shall recognize the
Holders of such Definitive Certificates as Investor Certificateholders
hereunder.
Global Certificate
. If specified in the related Supplement for any Series or
Class, the Investor Certificates for such Series or Class will initially be
issued in the form of a single temporary global Certificate (the "Global
Certificate") in bearer form, without interest coupons, in the denomination
of the aggregate principal amount of such Series or Class and substantially
in the form set forth in the exhibit with respect thereto attached to the
related Supplement. The Global Certificate will be executed by the Seller
and authenticated by the Trustee upon the same conditions, in substantially
the same manner and with the same effect as the Definitive Certificates.
The Global Certificate may be exchanged for Bearer or Registered
Certificates in definitive form (the "Definitive Euro-Certificates")
pursuant to the terms of any applicable Supplement.
Uncertificated Classes
. Notwithstanding anything to the contrary contained in this
Article VI or in Article XII, unless otherwise specified in any Supplement,
any provisions contained in this Article VI and in Article XII relating to
the registration, form, execution, authentication, delivery, presentation,
cancellation and surrender of Certificates shall not be applicable to any
uncertificated Certificates.
ARTICLE VII
Other Matters Relating to the Seller
Liability of the Seller
. The Seller shall be liable in all respects for the
obligations, covenants, representations and warranties of the Seller
arising under or related to this Agreement or any Supplement
. The Seller shall be liable only to the extent of the
obligations specifically undertaken by it in its capacity as Seller.
Merger or Consolidation of, or Assumption of the Obligations
of, the Seller
(a) . (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) (x) the business entity formed by such
consolidation or into which the Seller is merged or the Person
that acquires by conveyance or transfer the properties and
assets of the Seller substantially as an entirety shall be, if
the Seller is not the surviving entity, organized and existing
under the law of the United States of America or any State or
the District of Columbia, and, if the Seller is not the
surviving entity, such business entity shall expressly assume,
by an agreement supplemental hereto, executed and delivered to
the Trustee, in form reasonably satisfactory to the Trustee,
the performance of every covenant and obligation of the Seller
hereunder, including its obligations under Section 7.04;
(y) the Seller has delivered to the Trustee an Officer's
Certificate and an Opinion of Counsel each stating that such
consolidation, merger, conveyance or transfer and such
supplemental agreement comply with this Section, 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), and that all conditions precedent herein provided for
relating to such transaction have been complied with;
(ii) the Rating Agency Condition shall have been
satisfied with respect to such consolidation, merger,
conveyance or transfer;
(iii) the Seller shall have delivered to the
Trustee and each Rating Agency a Tax Opinion, dated the date of
such consolidation, merger, conveyance or transfer, with
respect thereto;
(iv) in connection with any merger or
consolidation, the business entity into which the Seller shall
merge or consolidate shall be (x) a business entity that is not
subject to Title 11 of the United States Code or (y) a special-
purpose corporation, the powers and activities of which shall
be limited to the performance of the Seller's obligations under
this Agreement, any Supplement and the Purchase Agreements; and
(v) if the Seller is not the surviving entity,
the surviving entity shall file new UCC1 financing statements
with respect to the interest of the Trust in the Receivables.
(b) 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 (i) the
provisions of the foregoing paragraph, (ii) Sections 2.13 or 6.03(d),
or (iii) conveyances, mergers, consolidations, assumptions, sales or
transfers to other entities (1) for which the Seller delivers a
Officer's Certificate to the Trustee indicating that the Seller
reasonably believes that such action will not adversely affect in any
material respect the interests of any Investor Certificateholder, (2)
that meet the requirements of clause (ii) of the preceding paragraph
and (3) for which such purchaser, transferee, pledgee or entity shall
expressly assume, in an agreement supplemental hereto, executed and
delivered to the Trustee in writing in form satisfactory to the
Trustee, the performance of every covenant and obligation of the
Seller thereby conveyed.
(c) This Section 7.02 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.
Limitations on Liability of the Seller
. Subject to Sections 7.01 and 7.04, neither the Seller nor
any of the directors, officers, employees or agents of the Seller acting in
such capacities shall be under any liability to the Trust, the Trustee, the
Certificateholders, any Series Enhancer or any other Person for any action
taken or for refraining from the taking of any action in good faith in
their capacities as Seller pursuant to this Agreement; provided, however,
that this provision shall not protect the Seller or any such Person against
any liability that would otherwise be imposed by reason of willful
misfeasance, bad faith or gross negligence in the performance of duties or
by reason of reckless disregard of obligations and duties hereunder
. The Seller and any director, officer, employee or agent of
the Seller may rely in good faith on any document of any kind prima facie
properly executed and submitted by any Person (other than the Seller)
respecting any matters arising hereunder.
Seller Indemnification of the Trust and the Trustee
. Subject to the limitation on remedies specified in Section
2.06, the Seller shall indemnify and hold harmless the Trust and the
Trustee and its officers, directors, employees and agents, from and against
any loss, liability, expense, damage or injury suffered or sustained by
reason of any acts or omissions of the Seller with respect to the Trust
pursuant to this Agreement, including any judgment, award, settlement,
reasonable attorneys' fees and other costs or expenses incurred in
connection with the defense of any action, proceeding or claim; provided,
however, that the Seller shall not indemnify the Trustee if such acts,
omissions or alleged acts or omissions constitute or are caused by fraud,
negligence, or willful misconduct by the Trustee; provided further, that
the Seller shall not indemnify the Trust, the Investor Certificateholders
or the Certificate Owners for any liabilities, costs or expenses of the
Trust with respect to any action taken by the Trustee at the request of the
Investor Certificateholders; provided further, that the Seller shall not
indemnify the Trust, the Investor Certificateholders or the Certificate
Owners as to any losses, claims or damages incurred by any of them in their
capacities as investors, including, without limitation, losses with respect
to market or investment risks associated with ownership of the Investor
Certificates or losses incurred as a result of Defaulted Receivables; and
provided further, that the Seller shall not indemnify the Trust, the
Investor Certificateholders or the Certificate Owners for any liabilities,
costs or expenses of the Trust, the Investor Certificateholders or the
Certificate Owners arising under any tax law, including without limitation,
any Federal, state, local or foreign income or franchise taxes or any other
tax imposed on or measured by income (or any interest or penalties with
respect thereto or arising from a failure to comply therewith) required to
be paid by the Trust, the Investor Certificateholders or the Certificate
Owners in connection herewith to any taxing authority. Indemnification
pursuant to this Section shall be payable solely to the extent that the
Seller has funds sufficient to make payments after satisfying its
obligations then payable under this Agreement and otherwise shall not
constitute a claim against the Seller.
ARTICLE VIII
Other Matters Relating to the Servicer
Liability of the Servicer
. The Servicer shall be liable under this Article only to the
extent of the obligations specifically undertaken by the Servicer in its
capacity as Servicer.
Merger or Consolidation of, or Assumption of the Obligations
of, the Servicer
. The Servicer 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)
(i) the corporation formed by such consolidation or
into which the Servicer is merged or the Person that 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, if the Servicer is not the surviving entity, such
corporation shall expressly assume, by an agreement supplemental
hereto, executed and delivered to the Trustee, in form reasonably
satisfactory to the Trustee, the performance of every covenant and
obligation of the Servicer hereunder;
(ii) the Servicer has delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel each stating
that such consolidation, merger, conveyance or transfer and
such supplemental agreement comply with this Section, 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), and that all conditions precedent herein provided for
relating to such transaction have been complied with; and
(iii) either (x) the corporation formed by such
consolidation or into which the Servicer is merged or the
Person that acquired by conveyance or transfer the properties
and assets of the Servicer substantially as an entirety shall
be an Eligible Servicer (taking into account, in making such
determination, the experience and operations of the predecessor
Servicer) or (y) upon the effectiveness of such consolidation,
merger, conveyance or transfer, a Successor Servicer shall have
assumed the obligations of the Servicer in accordance with this
Agreement.
(b) This Section 8.02 shall not be construed to
prohibit or in any way limit the Servicer's ability to effectuate any
consolidation or merger pursuant to which the Servicer would be the
surviving entity.
(c) The Servicer shall notify each Rating Agency
promptly after any consolidation, merger, conveyance or transfer
effected pursuant to this Section 8.02.
Limitation on Liability of the Servicer and Others
. Except as provided in Sections 8.04 and 11.05, neither the
Servicer nor any of the directors, officers, employees or agents of the
Servicer in its capacity as Servicer shall be under any liability to the
Trust, the Trustee, the Certificateholders, any Series Enhancers or any
other person for any action taken or for refraining from the taking of any
action in good faith in its capacity as Servicer pursuant to this
Agreement; provided, however, that this provision shall not protect the
Servicer or any such Person against any liability that would otherwise be
imposed by reason of willful misfeasance, bad faith or gross negligence in
the performance of duties or by reason of reckless disregard of obligations
and duties hereunder. The Servicer and any director, officer, employee or
agent of the Servicer may rely in good faith on any document of any kind
prima facie properly executed and submitted by any Person (other than the
Servicer) respecting any matters arising hereunder. The Servicer shall not
be under any obligation to appear in, prosecute or defend any legal action
that is not incidental to its duties as Servicer in accordance with this
Agreement and that in its reasonable judgment may involve it in any expense
or liability. The Servicer may, in its sole discretion, undertake any such
legal action that it may deem necessary or desirable for the benefit of the
Certificateholders with respect to this Agreement and the rights and duties
of the parties hereto and the interests of the Certificateholders
hereunder.
Servicer Indemnification of the Trust and the Trustee
. The Servicer shall indemnify and hold harmless the Trust and
the Trustee and its officers, directors, employees and agents, from and
against any loss, liability, expense, damage or injury suffered or
sustained by reason of any acts or omissions of the Servicer with respect
to the Trust pursuant to this Agreement, including any judgment, award,
settlement, reasonable attorneys' fees and other costs or expenses incurred
in connection with the defense of any action, proceeding or claim;
provided, however, that the Servicer shall not indemnify the Trustee if
such acts, omissions or alleged acts or omissions constitute or are caused
by fraud, negligence, or willful misconduct by the Trustee; provided
further, that the Servicer shall not indemnify the Trust, the Investor
Certificateholders or the Certificate Owners for any liabilities, costs or
expenses of the Trust with respect to any action taken by the Trustee at
the request of the Investor Certificateholders; provided further, that the
Servicer shall not indemnify the Trust, the Investor Certificateholders or
the Certificate Owners as to any losses, claims or damages incurred by any
of them in their capacities as investors, including, without limitation,
losses with respect to market or investment risks associated with ownership
of the Investor Certificates or losses incurred as a result of Defaulted
Receivables; and provided further, that the Servicer shall not indemnify
the Trust, the Investor Certificateholders or the Certificate Owners for
any liabilities, costs or expenses of the Trust, the Investor
Certificateholders or the Certificate Owners arising under any tax law,
including without limitation, any Federal, state, local or foreign income
or franchise taxes or any other tax imposed on or measured by income (or
any interest or penalties with respect thereto or arising from a failure to
comply therewith) required to be paid by the Trust, the Investor
Certificateholders or the Certificate Owners in connection herewith to any
taxing authority. Indemnification pursuant to this Section shall not be
payable from the Trust Assets. The provisions of this indemnity shall run
directly to and be enforceable by an injured party subject to the
limitations hereof.
The Servicer Not To Resign
. The Servicer shall not resign from the obligations and
duties hereby imposed on it except (x) upon the determination that (i) the
performance of its duties hereunder is no longer permissible under
Requirements of Law (other than the charter and by-laws of the Servicer)
and (ii) there is no reasonable action that the Servicer could take to make
the performance of its duties hereunder permissible under such Requirements
of Law or (y) as may be required, in connection with the Servicer's
consolidation with, or merger into any other corporation or the Servicer's
conveyance or transfer of its properties and assets substantially as an
entirety to any person in each case, in accordance with Section 8.02. Any
determination permitting the resignation of the Servicer pursuant to clause
(x) above shall be evidenced by an Opinion of Counsel to such effect
delivered 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. If within
120 days of the date of the determination that the Servicer may no longer
act as Servicer, and if the Trustee is unable to appoint a Successor
Servicer, the Trustee shall serve as Successor Servicer. Notwithstanding
the foregoing, the Trustee shall, if it is legally unable so to act,
petition a court of competent jurisdiction to appoint any established
institution having a net worth of not less than $50,000,000 and whose
regular business includes the servicing of credit card accounts as the
Successor Servicer hereunder. The Trustee shall give prompt notice to each
Rating Agency and each Series Enhancer entitled thereto under the terms of
the applicable Supplement upon the resignation of the Servicer or the
appointment of a Successor Servicer.
Access to Certain Documentation and Information Regarding the
Receivables
. The Servicer shall provide to the Trustee access to the
documentation regarding the Accounts and 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 but
only (a) upon reasonable request, (b) during normal business hours,
(c) subject to the Servicer's normal security and confidentiality
procedures and (d) at reasonably accessible offices in the continental
United States designated by the Servicer. Nothing in this Section shall
derogate from the obligation of the Account Originators, the Seller, the
Trustee and the Servicer to observe any applicable law prohibiting
disclosure of information regarding the Obligors and the failure of the
Servicer to provide access as provided in this Section as a result of such
obligation shall not constitute a breach of this Section.
Delegation of Duties
. In the ordinary course of business, the Servicer may at any
time delegate any duties hereunder to any Person who agrees to conduct such
duties in accordance with the Account Guidelines and this Agreement;
provided, however, at least 30 days prior written notice shall be given to
the Trustee, each Rating Agency and each Series Enhancer entitled thereto
pursuant to the relevant Supplement, of such delegation. Any such
delegation shall not relieve the Servicer of its liability and
responsibility with respect to such duties, and shall not constitute a
resignation within the meaning of Section 8.05 hereof.
Examination of Records
. The Seller and the Servicer shall clearly and unambiguously
indicate in their computer files or other records that the Receivables
arising in the Accounts have been conveyed to the Trustee, on behalf of the
Trust, pursuant to this Agreement for the benefit of the
Certificateholders. The Seller and the Servicer shall, prior to the sale
or transfer to a third party of any receivable held in its custody, examine
its computer and other records to determine that such receivable is not a
Receivable.
ARTICLE IX
Pay Out Events
Pay Out Events
. If any one of the following events (each, a "Pay Out Event")
shall occur with respect to any Series:
(a) The Neiman Marcus Group, Inc., the Seller or any
Holder of the Seller Certificate shall fail generally to, or admit in
writing its inability to, pay its debts as they become due; or a
proceeding shall have been instituted in a court having jurisdiction
in the premises seeking a decree or order for relief in respect of
The Neiman Marcus Group, Inc., the Seller or any Holder of the Seller
Certificate in an involuntary case under any Debtor Relief Law, or
for the appointment of a receiver, liquidator, assignee, trustee,
custodian, sequestrator, conservator or other similar official of
such Person or for any substantial part of its property, or for the
winding-up or liquidation of its affairs and, if instituted against
the Seller or any Holder of the Seller Certificate, any such
proceeding shall continue undismissed or unstayed and in effect, for
a period of 60 consecutive days, or any of the actions sought in such
proceeding shall occur; or the commencement by The Neiman Marcus
Group, Inc., the Seller or any Holder of the Seller Certificate, of a
voluntary case under any Debtor Relief Law, or such Person's consent
to the entry of an order for relief in an involuntary case under any
Debtor Relief Law, or consent to the appointment of or taking
possession by a receiver, liquidator, assignee, trustee, custodian,
sequestrator, conservator or other similar official of such Person or
for any substantial part of its property, or any general assignment
for the benefit of creditors; or such Person or any Subsidiary of
such Person shall have taken any corporate action in furtherance of
any of the foregoing actions (any such event, an "Insolvency Event");
(b) the Trust shall become an "investment company"
within the meaning of the Investment Company Act; or
(c) a Transfer Restriction Event shall occur;
then in the case of any such event, a Pay Out Event shall occur with
respect to such Series without any notice or other action on the part of
the Trustee or the Investor Certificateholders, immediately upon the
occurrence of such event.
Section 9.02 Additional Rights upon the Occurrence of
Certain Events. If an Insolvency Event occurs with respect to any Seller
or Holder of the Seller Certificate, the Seller shall on the day any such
Insolvency Event occurs, immediately cease to transfer Principal
Receivables or any Participation Interests to the Trust and shall promptly
give notice to the Trustee thereof. Notwithstanding any cessation of the
transfer to the Trust of additional Principal Receivables or any
Participation Interests, Principal Receivables or any Participation
Interests transferred to the Trust prior to the occurrence of such
Insolvency Event and Collections in respect of such Principal Receivables
and Participation Interests, and Finance Charge Receivables whenever
created accrued in respect of such Principal Receivables, shall continue to
be a part of the Trust. The provisions of Sections 9.01 and 9.02 shall not
be deemed to be mutually exclusive.
ARTICLE X
Servicer Defaults
Servicer Defaults
. If any one of the following events (a "Servicer Default")
shall occur and be continuing:
(a) any failure by the Servicer to make any payment,
transfer or deposit or to give instructions or notice to the Trustee
pursuant to the terms of this Agreement or any Supplement on or
before the date occurring five Business Days after the date such
payment, transfer or deposit or such instruction or notice is
required to be made or given, as the case may be, under the terms of
this Agreement or any Supplement;
(b) failure on the part of the Servicer to duly
observe or perform in any material respect any other covenants or
agreements of the Servicer set forth in this Agreement or any
Supplement that has a material adverse effect on the interests
hereunder of the Investor Certificateholders of any Series or Class
(which determination shall be made without regard to whether funds
are then available pursuant to any Series Enhancement) and that
continues unremedied for a period of 60 days after the date on which
written notice of such failure, requiring the same to be remedied,
shall have been given to the Servicer by the Trustee, or to the
Servicer and the Trustee by Holders of Investor Certificates
evidencing not less than 25% of the aggregate unpaid principal amount
of all Investor Certificates (or, with respect to any such failure
that does not relate to all Series, 25% of the aggregate unpaid
principal amount of all Series to which such failure relates); or the
Servicer shall delegate its duties under this Agreement, except as
permitted by Sections 8.02 and 8.07, a Responsible Officer of the
Trustee has actual knowledge of such delegation and such delegation
continues unremedied for 15 days after the date on which written
notice thereof, requiring the same to be remedied, shall have been
given to the Servicer by the Trustee, or to the Servicer and the
Trustee by Holders of Investor Certificates evidencing not less than
25% of the aggregate unpaid principal amount of all Investor
Certificates;
(c) any representation, warranty or certification made
by the Servicer in this Agreement or any Supplement or in any
certificate delivered pursuant to this Agreement or any Supplement
shall prove to have been incorrect when made, that has a material
adverse effect on the rights of the Investor Certificateholders of
any Series or Class (which determination shall be made without regard
to whether funds are then available pursuant to any Series
Enhancement) and that continues to be incorrect in any material
respect for a period of 60 days after the date on which written
notice of such failure, requiring the same to be remedied, shall have
been given to the Servicer by the Trustee, or to the Servicer and the
Trustee by the Holders of Investor Certificates evidencing not less
than 25% of the aggregate unpaid principal amount of all Investor
Certificates (or, with respect to any such representation, warranty
or certification that does not relate to all Series, 25% of the
aggregate unpaid principal amount of all Series to which such
representation, warranty or certification relates); or
(d) The Servicer shall fail generally to, or admit in
writing its inability to, pay its debts as they become due; or a
proceeding shall have been instituted in a court having jurisdiction
in the premises seeking a decree or order for relief in respect of
the Servicer in an involuntary case under any Debtor Relief Law, or
for the appointment of a receiver, liquidator, assignee, trustee,
custodian, sequestrator, conservator or other similar official of
such Person or for any substantial part of its property, or for the
winding-up or liquidation of its affairs and, if instituted against
the Servicer, any such proceeding shall continue undismissed or
unstayed and in effect, for a period of 60 consecutive days, or any
of the actions sought in such proceeding shall occur; or the
commencement by the Servicer, of a voluntary case under any Debtor
Relief Law, or such Person's consent to the entry of an order for
relief in an involuntary case under any Debtor Relief Law, or consent
to the appointment of or taking possession by a receiver, liquidator,
assignee, trustee, custodian, sequestrator, conservator or other
similar official of such Person or for any substantial part of its
property, or any general assignment for the benefit of creditors; or
such Person or any Subsidiary of such Person shall have taken any
corporate action in furtherance of any of the foregoing actions;
then, in the event of any Servicer Default, so long as the Servicer Default
shall not have been remedied, either the Trustee or the Holders of Investor
Certificates evidencing more than 50% of the aggregate unpaid principal
amount of all Investor Certificates, by notice given to the Servicer (and
to the Trustee and any Series Enhancer entitled thereto pursuant to the
relevant Supplement if given by the Investor Certificateholders) (a
"Termination Notice"), may terminate all but not less than all the rights
and obligations of the Servicer as Servicer under this Agreement and in and
to the Receivables and the proceeds thereof; provided, however, if within
60 days of receipt of a Termination Notice the Trustee does not receive any
bids from Eligible Servicers in accordance with Section 10.02(c) to act as
a Successor Servicer and receives an Officer's Certificate of the Servicer
to the effect that the Servicer cannot in good faith cure the Servicer
Default that gave rise to the Termination Notice, the Trustee shall offer
the Seller the right at its option to purchase the Certificateholders'
Interest on the Distribution Date occurring in the next calendar month.
The purchase price for the Certificateholders' Interest shall be equal to
the sum of the amounts specified therefor with respect to each outstanding
Series in the related Supplement. The Seller shall notify the Trustee
prior to the Record Date for the related Distribution Date of the purchase
if it is exercising such option. If it exercises such option, the Seller
shall (x) deliver to the Trustee an Opinion of Counsel (which must be an
independent outside counsel) to the effect that, in reliance on certain
certificates to the effect that the Receivables constitute fair value for
consideration paid therefor and as to the solvency of the Seller, the
purchase would not be considered a fraudulent conveyance and (y) deposit
the purchase price into the Collection Account not later than 12:00 noon,
New York City time, on such Distribution Date in immediately available
funds. The purchase price shall be allocated and distributed to Investor
Certificateholders in accordance with Article IV and the terms of each
Supplement.
After receipt by the Servicer of such 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 the Successor Servicer;
and, without limitation, the Trustee is hereby authorized and empowered
(upon the failure of the Servicer to cooperate) to execute and deliver, on
behalf of the Servicer, as attorney-in-fact or otherwise, all documents and
other instruments upon the failure of the Servicer to execute or deliver
such documents or instruments, and to do and accomplish all other acts or
things necessary or appropriate to effect the purposes of such transfer of
servicing rights. The Servicer agrees to cooperate with the Trustee and
the Successor Servicer in effecting the termination of the responsibilities
and rights of the Servicer to conduct servicing hereunder including,
without limitation, the transfer to the Successor Servicer of all authority
of the Servicer to service the Receivables provided for under this
Agreement, including, without limitation, all authority over all
Collections that shall on the date of transfer be held by the Servicer for
deposit, or that have been deposited by the Servicer, in the Collection
Account, or that shall thereafter be received with respect to the
Receivables, and in assisting the Successor Servicer and in enforcing all
rights to Insurance Proceeds. The Servicer shall promptly transfer its
electronic records relating to the Receivables to the Successor Servicer in
such electronic form as the Successor Servicer may reasonably request and
shall promptly transfer to the Successor Servicer all other records,
correspondence and documents necessary for the continued servicing of the
Receivables in the manner and at such times as the Successor Servicer shall
reasonably request. To the extent that compliance with this Section 10.01
shall require the Servicer to disclose to the Successor Servicer
information of any kind that the Servicer reasonably deems to be
confidential, the Successor Servicer shall be required to enter into such
customary licensing and confidentiality agreements as the Servicer shall
deem necessary to protect its interests.
Notwithstanding the foregoing, any delay in or failure of
performance under Section 10.01(a) for a period of five Business Days or
under Section 10.01(b) or (c) for a period of 60 days (in addition to any
period provided in Section 10.01(a), (b) or (c)) shall not constitute a
Servicer Default until the expiration of such additional five Business Days
or 60 days, respectively, if such delay or failure could not be prevented
by the exercise of reasonable diligence by the Servicer and such delay or
failure was caused by an act of God or the public enemy, acts of declared
or undeclared war, public disorder, rebellion or sabotage, epidemics,
landslides, lightning, fire, hurricanes, earthquakes, floods or similar
causes. The preceding sentence shall not relieve the Servicer from the
obligation to use its best efforts to perform its obligations in a timely
manner in accordance with the terms of this Agreement and any Supplement
and the Servicer shall provide the Trustee, each Rating Agency, any Series
Enhancer entitled thereto pursuant to the relevant Supplement, the Holder
of the Seller Certificate 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 to so perform its obligations.
Trustee to Act; Appointment of Successor
(a) . (a) On and after the receipt by the Servicer of
a Termination Notice pursuant to Section 10.01, the Servicer shall
continue to perform all servicing functions under this Agreement
until the date specified in the Termination Notice or otherwise
specified by the Trustee or until a date mutually agreed upon by the
Servicer and Trustee. The Trustee shall promptly as possible after
the giving of a Termination Notice appoint an Eligible Servicer as a
successor servicer (the "Successor Servicer"), and such Successor
Servicer shall accept its appointment by a written assumption in a
form acceptable to the Trustee. In the event that a Successor
Servicer has not been appointed or has not accepted its appointment
at the time when the Servicer ceases to act as Servicer, the Trustee
without further action shall automatically be appointed the Successor
Servicer. The Trustee may delegate any of its servicing obligations
to an Affiliate of the Trustee or agent in accordance with Section
3.01(b) and 8.07. Notwithstanding the foregoing, the Trustee shall,
if it is legally unable so to act, petition a court of competent
jurisdiction to appoint any established institution having a net
worth of not less than $50,000,000 and whose regular business
includes the servicing of credit card receivables as the Successor
Servicer hereunder. The Trustee shall give prompt notice to each
Rating Agency and each Series Enhancer entitled thereto pursuant to
the applicable Supplement upon the appointment of a Successor
Servicer.
(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 (except for liabilities
arising during the period of time when the prior Servicer was
performing and acting as Servicer) relating thereto placed on the
Servicer by the terms and provisions hereof, and all references in
this Agreement to the Servicer shall be deemed to refer to the
Successor Servicer.
(c) In connection with any Termination Notice, the
Trustee will review any bids that it obtains from Eligible Servicers
and shall be permitted to appoint any Eligible Servicer submitting
such a bid as a Successor Servicer for servicing compensation not in
excess of the aggregate Servicing Fees for all Series; provided,
however, that the Holder of the Seller Certificate shall be
responsible for payment of the portion of such aggregate Servicing
Fees allocable to the Holder of the Seller Certificate and that no
such monthly compensation paid out of Collections shall be in excess
of such aggregate Servicing Fees. Each Holder of the Seller
Certificate agrees that, if The Neiman Marcus Group, Inc. (or any
Successor Servicer) is terminated as Servicer hereunder, the portion
of the Collections in respect of Finance Charge Receivables that the
Holder of the Seller Certificate is entitled to receive pursuant to
this Agreement or any Supplement shall be reduced by an amount
sufficient to pay the Holder of the Seller Certificate share
(determined by reference to the Supplements with respect to any
outstanding Series) of the compensation of the Successor Servicer.
(d) All authority and power granted to the Successor
Servicer under this Agreement shall automatically cease and terminate
upon termination of the Trust pursuant to Section 12.01 and shall
pass to and be vested in the Seller and, without limitation, the
Seller 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 Seller in effecting the termination of the
responsibilities and rights of the Successor Servicer to conduct
servicing on the Receivables. The Successor Servicer shall transfer
its electronic records relating to the Receivables to the Seller in
such electronic form as the Seller may reasonably request and shall
transfer all other records, correspondence and documents to the
Seller in the manner and at such times as the Seller shall reasonably
request. To the extent that compliance with this Section 10.02 shall
require the Successor Servicer to disclose to the Seller information
of any kind that the Successor Servicer deems to be confidential, the
Seller shall be required to enter into such customary licensing and
confidentiality agreements as the Successor Servicer shall deem
necessary to protect its interests.
Notification to Certificateholders
. Within two Business Days after the Servicer becomes aware of
any Servicer Default, the Servicer shall give notice thereof to the
Trustee, each Rating Agency and any Series Enhancer entitled thereto
pursuant to the relevant Supplement and the Trustee shall give notice to
the Investor Certificateholders. Upon any termination or appointment of a
Successor Servicer pursuant to this Article, the Trustee shall give prompt
notice thereof to the Investor Certificateholders.
ARTICLE XI
The Trustee
Duties of Trustee
(a) . (a) The Trustee, prior to the occurrence of a
Servicer Default and after the curing of all Servicer Defaults that
may have occurred, undertakes to perform such duties and only such
duties as are specifically set forth in this Agreement. If 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 its
exercise, as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs.
(b) The Trustee, upon receipt of all resolutions,
certificates, statements, opinions, reports, documents, orders or
other instruments furnished to the Trustee that are specifically
required to be furnished pursuant to any provision of this Agreement,
shall examine them to determine whether they conform to the
requirements of this Agreement. The Trustee shall give prompt
written notice to the Certificateholders of any material lack of
conformity of any such instrument to the applicable requirements of
this Agreement discovered by the Trustee that would entitle a
specified percentage of the Certificateholders to take any action
pursuant to this Agreement.
(c) Subject to Section 11.01(a), no provision of this
Agreement shall be construed to relieve the Trustee from liability
for its own negligent action, its own negligent failure to act or its
own 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 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
the Holders of Investor Certificates relating to the time,
method and place of conducting any proceeding for any remedy
available to the Trustee, or exercising any trust or power
conferred upon the Trustee, under this Agreement; provided
that, such direction is delivered by the Holder of Investor
Certificates evidencing the percentage of the aggregate unpaid
principal amount of Investor Certificates of all Series to
which such action relates required for such action by the terms
of this Agreement; and
(iii) the Trustee shall not be charged with
knowledge of any failure by the Servicer referred to in clauses
(a) and (b) of Section 10.01 unless a Responsible Officer of
the Trustee obtains actual knowledge of such failure or the
Trustee receives written notice of such failure from the
Servicer, any Holders of Investor Certificates evidencing not
less than 25% of the aggregate unpaid principal amount of all
Investor Certificates (or, with respect to any such failure
that does not relate to all Series, 25% of the aggregate unpaid
principal amount of all Investor Certificates of all Series to
which such failure relates, or the Series Enhancers for all
Series to which such failure relates).
(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 in the exercise of any
of its rights or powers hereunder or thereunder, if there is
reasonable ground for believing that the repayment of such funds or
adequate indemnity against such risk or liability is not reasonably
assured to it, and none of the provisions contained in this Agreement
shall in any event require the Trustee to perform, or be responsible
for the manner of performance of, any of the 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) The Trustee shall have no power to vary the corpus
of the Trust, except as expressly provided in this Agreement.
(f) In the event that the Paying Agent or 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
Paying Agent or the Transfer Agent and Registrar, as the case may be,
under this Agreement, the Trustee shall be obligated as soon as
possible upon knowledge of a Responsible Officer thereof and receipt
of appropriate records, if any, to perform such obligation, duty or
agreement in the manner so required.
(g) If the Seller has agreed to transfer any of its
receivables (other than the Receivables) to another Person, upon the
written request of the Seller, the Trustee will enter into such
intercreditor agreements with the transferee of such receivables as
are customary and necessary to separately identify the rights of the
Trust and such other Person in the Seller's receivables; provided
that the Trustee shall not be required to enter into any
intercreditor agreement that could adversely affect the interests of
the Certificateholders and, upon the request of the Trustee, the
Seller will deliver an Opinion of Counsel on any matters relating to
such intercreditor agreement, reasonably requested by the Trustee.
Certain Matters Affecting the Trustee
. Except as otherwise provided in Section 11.01:
(a) the Trustee may rely on and shall be 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
reasonably believed by it 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 any
advice of such counsel, 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 any Enhancement Agreement, or to institute, conduct or defend any
litigation hereunder or thereunder or in relation to this Agreement
or any Enhancement Agreement, at the request, order or direction of
any of the Certificateholders, pursuant to the provisions of this
Agreement or any Enhancement Agreement, unless such
Certificateholders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities
that may be incurred therein or thereby; nothing contained herein
shall, however, relieve the Trustee of the obligations, upon the
occurrence of any Servicer Default (which has not been cured) 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 its
exercise, as a prudent person would exercise or use under the
circumstances in the conduct of such person's own affairs;
(d) the Trustee shall not be personally liable for any
action taken, suffered or omitted by it in good faith and believed by
it to be authorized or within the discretion or rights or powers
conferred upon it by 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, approval, bond or other paper or document, unless
requested in writing to do so by Holders of Investor Certificates
evidencing more than 25% of the aggregate unpaid principal amount of
all Investor Certificates (or, with respect to any such matters that
do not relate to all Series, 25% of the aggregate unpaid principal
amount of the Investor Certificates of all Series to which such
matters relate);
(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 any
such agent, attorney or custodian appointed with due care by it
hereunder; and
(g) except as may be required by subsection 11.01(a)
hereof, the Trustee shall not be required to make any initial or
periodic examination of any documents or records related to the
Receivables or the Accounts for the purpose of establishing the
presence or absence of defects, the compliance by the Seller with its
representations and warranties or for any other purpose.
Trustee Not Liable for Recitals in Certificates
. 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 any Supplement 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 Seller of any of the Certificates or of
the proceeds of such Certificates, or for the use or application of any
funds paid to the Seller or the Holder of the Seller Certificate in respect
of the Receivables or deposited in or withdrawn from the Collection
Account, any Series Accounts or any other accounts hereafter established to
effectuate the transactions contemplated by this Agreement and in
accordance with the terms of this Agreement.
Trustee May Own Certificates
. Subject to Section 6.06, the Trustee in its individual or
any other capacity may become the owner or pledgee of Investor Certificates
with the same rights as it would have if it were not the Trustee.
The Servicer To Pay Trustee's Fees and Expenses
. The Servicer covenants and agrees to pay to the Trustee from
time to time, and the Trustee shall be entitled to receive, reasonable
compensation (which shall not be limited by any provision of law in regard
to the compensation of a trustee of an express trust) for all services
rendered by it in the execution of the trust hereby created and in the
exercise and performance of any of the powers and duties hereunder of the
Trustee, and the Servicer will pay or reimburse the Trustee (without
reimbursement from the Collection Account or otherwise) upon its request
for all reasonable expenses or disbursements incurred or made by the
Trustee in accordance with any of the provisions of this Agreement or any
Enhancement Agreement (including the reasonable fees and expenses of its
agents, any cotrustee and counsel) except any such expense, disbursement or
advance as may arise from its own negligence, willful misconduct or bad
faith and except as provided in the following sentence. If the Trustee is
appointed Successor Servicer pursuant to Section 10.02, the provisions 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.
The obligations of the Servicer under Section 8.04 and this
Section 11.05 shall survive the termination of the Trust and the
resignation or removal of the Trustee.
Eligibility Requirements for Trustee
. The Trustee hereunder shall at all times be a bank, trust
company or a corporation organized and doing business under the laws of the
United States of America or any state thereof authorized under such laws to
exercise corporate trust powers, having a combined capital and surplus of
at least $50,000,000 and subject to supervision or examination by Federal
or state authority and maintain any credit or deposit rating required by
any Rating Agency (as of the date hereof, Baa3 for Moody's and BBB- for
Standard & Poor's). If such bank or corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purpose of this
Section 11.06, the combined capital and surplus of such bank or 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.
Resignation or Removal of Trustee
(a) . (a) The Trustee may at any time resign and be
discharged from the trust hereby created by giving written notice
thereof to the Servicer and to each Rating Agency. Upon receiving
such notice of resignation, the Seller shall promptly appoint a
successor trustee by written instrument, in duplicate, one copy of
which instrument shall be delivered to the resigning Trustee and one
copy to the successor trustee. If no successor trustee shall have
been so appointed and have accepted 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.
(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 the
Seller, or if at any time the Trustee shall be legally unable to act,
or shall be adjudged a bankrupt or insolvent, or 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, in which event the Servicer shall remove the Trustee and
promptly appoint a successor trustee by written instrument, in
duplicate, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor trustee.
(c) Any resignation or removal of the Trustee and
appointment of a 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 and
any liability of the Trustee arising hereunder shall survive such
appointment of a successor trustee.
Successor Trustee
(a) . (a) Any successor trustee appointed as provided
in Section 11.07 shall execute, acknowledge and deliver to the
Seller, to the Servicer and to its predecessor Trustee an instrument
accepting such appointment hereunder, and thereupon the resignation
or removal of the predecessor Trustee shall become effective and such
successor trustee, without any further act, deed or conveyance, shall
become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with the like effect as if
originally named as Trustee herein. The predecessor Trustee shall
deliver to the successor trustee all documents and statements held by
it hereunder, and the Seller 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 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, such successor trustee shall
provide notice of such succession hereunder to all Investor
Certificateholders and the Servicer shall provide such notice to each
Rating Agency and any Series Enhancer entitled thereto pursuant to
the relevant Supplement.
Merger or Consolidation of Trustee
. Any Person into which the Trustee may be merged or converted
or with which it may be consolidated, or any Person resulting from any
merger, conversion or consolidation to which the Trustee shall be a party,
or any Person succeeding to the corporate trust business of the Trustee,
shall be the successor of the Trustee hereunder, provided such corporation
shall be eligible under the provisions of Section 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.
Appointment of CoTrustee or Separate Trustee
(a) . (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 cotrustee 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; provided, however, that the Trustee
shall exercise due care in the appointment of any cotrustee. No
cotrustee 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 cotrustee
or separate trustee shall be required under Section 11.08.
(b) Every separate trustee and cotrustee 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 cotrustee jointly (it being understood that
such separate trustee or cotrustee is not authorized to act
separately without the Trustee joining in such act) except to
the extent that under any laws of any jurisdiction in which any
particular act or acts are to be performed (whether as Trustee
hereunder or as successor to the Servicer hereunder) the
Trustee shall be incompetent or unqualified to perform such act
or acts, in which event such rights, powers, duties and
obligations (including the holding of title to the Trust or any
portion thereof in any such jurisdiction) shall be exercised
and performed singly by such separate trustee or co-trustee,
but solely at the direction of the Trustee;
(ii) no trustee hereunder shall be personally
liable by reason of any act or omission of any other trustee
hereunder; and
(iii) the Trustee may at any time accept the
resignation of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the
Trustee shall be deemed to have been given to each of the then
separate trustees and cotrustees, as effectively as if given to each
of them. Every instrument appointing any separate trustee or
cotrustee shall refer to this Agreement and the conditions of this
Article XI. Each separate trustee and cotrustee, 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 cotrustee 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 to this Agreement on its behalf and in its
name. If any separate trustee or cotrustee shall die, become
incapable of acting, resign or be removed, all of its estates,
properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Tax 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 terms of each Supplement
shall also prepare or shall cause to be prepared all tax information
required by law to be distributed to Investor 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. In no event shall the Trustee
or the Servicer (except as provided in Sections 7.04 or 8.04) be liable for
any liabilities, costs or expenses of the Trust or the Investor
Certificateholders arising under any tax law, including without limitation
Federal, state, local or foreign income or excise taxes or any other tax
imposed or measured by income (or any interest or penalty with respect
thereto or arising from a failure to comply therewith).
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 ratable benefit of the Certificateholders in
respect of which such judgment has been obtained.
Suits for Enforcement
. If a Servicer Default shall occur and be continuing, the
Trustee, in its discretion may, subject to the provisions of Sections 10.01
and 11.14 proceed to protect and enforce its rights and the rights of the
Certificateholders under this Agreement by a 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.
Rights of Certificateholders to Direct Trustee
. Holders of Investor Certificates evidencing more than 50% of
the aggregate unpaid principal amount of all Investor Certificates (or,
with respect to any remedy, trust or power that does not relate to all
Series, 50% of the aggregate unpaid principal amount of the Investor
Certificates of all Series to which such remedy, trust or power relates)
shall have the right to direct the time, method, and place of conducting
any proceeding for any remedy available to the Trustee, or exercising any
trust or power conferred on the Trustee relating to such proceeding;
provided, however, that, subject to Section 11.01, the Trustee shall have
the right to decline to follow any such direction if the Trustee 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; and provided further that nothing in this Agreement shall impair
the right of the Trustee to take any action deemed proper by the Trustee
and that is not inconsistent with such direction.
Representations and Warranties of Trustee
. The Trustee represents and warrants as of each Closing Date
that:
(a) the Trustee is a banking corporation organized,
existing and in good standing under the laws of the state of New
York;
(b) the Trustee has full power, authority and right to
execute, deliver and perform this Agreement and each Supplement, and
has taken all necessary action to authorize the execution, delivery
and performance by it of this Agreement and each Supplement; and
(c) this Agreement and each Supplement has been duly
executed and delivered by the Trustee and is a binding obligation of
the Trustee enforceable against the Trustee in accordance with its
terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect affecting the enforcement of
creditors' rights in general and except as such enforceability may be
limited by general principles of equity (whether considered in a suit
at law or in equity).
Maintenance of Office or Agency
. The Trustee will maintain at its expense 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
(a) in the City of New York, in the case of Registered Certificates and
Holders thereof, and (b) in London or Luxembourg, in the case of Bearer
Certificates and Holders thereof, if and for so long as any Bearer
Certificates are outstanding. The Corporate Trust Office shall initially
be located at 000 Xxxxxxx Xxxxxx, Xxxxx 00X, Xxx Xxxx, Xxx Xxxx 00000. The
Trustee will give prompt notice to the Servicer and to Investor
Certificateholders of any change in the location of the Certificate
Register or any such office or agency.
Confidentiality
. Information provided by the Account Originators or the
Seller to the Trustee related to the transaction effected hereunder,
including all information related to the Obligors with respect to the
Receivables, and any computer software provided to the Trustee in
connection with the transaction effected hereunder or under any Supplement,
in each case whether in the form of documents, reports, lists, tapes, discs
or any other form, shall be "Confidential Information." The Trustee and
its agents, representatives or employees shall at all times maintain the
confidentiality of all Confidential Information and shall not, without the
prior written consent of the applicable Account Originator or the Seller,
as applicable, disclose to third parties (including Certificateholders) or
use such information, in any manner whatsoever, in whole or in part, except
as expressly permitted under this Agreement or under any Supplement or as
required to fulfill an obligation of the Trustee under this Agreement or
under any Supplement, in which case such Confidential Information shall be
revealed only to the extent expressly permitted or only to the Trustee's
agents, representatives and employees who need to know such Confidential
Information to the extent required for the purpose of fulfilling an
obligation of the Trustee under this Agreement or under any Supplement.
Notwithstanding the above, Confidential Information may be disclosed to the
extent required by law or legal process, provided that the Trustee gives
prompt written notice to the applicable Account Originator or the Seller,
as applicable, of the nature and scope of such disclosure.
ARTICLE XII
Termination
Termination of Trust
. The Trust and the respective obligations and
responsibilities of the Seller, the Servicer and the Trustee created hereby
(other than the obligation of the Trustee to make payments to Investor
Certificateholders as hereinafter set forth) shall terminate, except with
respect to the duties described in Sections 7.04, 8.04, and 12.02(b), upon
the earlier of (i) March 1, 2015, and (ii) the day following the
Distribution Date on which the Invested Amount and Enhancement Invested
Amount for each Series is zero (provided that the Seller has delivered a
written notice to the Trustee electing to terminate the Trust).
Section 12.02 Final Distribution. (a) The Servicer shall
give the Trustee at least 30 days prior notice of the Distribution Date on
which the Investor Certificateholders of any Series or Class may surrender
their Investor Certificates for payment of the final distribution on and
cancellation of such Investor Certificates (or, in the event of a final
distribution resulting from the application of Section 2.06, 9.02 or 10.01,
notice of such Distribution Date promptly after the Servicer has determined
that a final distribution will occur, if such determination is made less
than 30 days prior to such Distribution Date). Such notice shall be
accompanied by an Officer's Certificate setting forth the information
specified in Section 3.05 covering the period during the then current
calendar year through the date of such notice. Not later than the fifth
day of the month in which the final distribution in respect of such Series
or Class is payable to Investor Certificateholders, the Trustee shall
provide notice to Investor Certificateholders of such Series or Class
specifying (i) the date upon which final payment of such Series or Class
will be made upon presentation and surrender of Investor Certificates of
such Series or Class at the office or offices therein designated, (ii) the
amount of any such final payment and (iii) that the Record Date otherwise
applicable to such payment date is not applicable, payments being made only
upon presentation and surrender of such Investor Certificates at the office
or offices therein specified (which, in the case of Bearer Certificates,
shall be outside the United States). The Trustee shall give such notice to
the Transfer Agent and Registrar and the Paying Agent at the time such
notice is given to Investor Certificateholders.
Notwithstanding a final distribution to the Investor
Certificateholders of any Series or Class (or the termination of the
Trust), except as otherwise provided in this paragraph, all funds then on
deposit in the Collection Account, the Excess Funding Account and any
Series Account allocated to such Investor Certificateholders shall continue
to be held in trust for the benefit of such Investor Certificateholders and
the Paying Agent or the Trustee shall pay such funds to such Investor
Certificateholders upon surrender of their Investor Certificates (and any
excess shall be paid in accordance with the terms of any relevant
Enhancement Agreement). In the event that all such Investor
Certificateholders shall not surrender their Investor Certificates for
cancellation within six months after the date specified in the notice from
the Trustee described in paragraph (a), the Trustee shall give a second
notice to the remaining such Investor Certificateholders to surrender their
Investor Certificates for cancellation and receive the final distribution
with respect thereto (which surrender and payment, in the case of Bearer
Certificates, shall be outside the United States). If within one year
after the second notice all such Investor 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
such Investor Certificateholders concerning surrender of their Investor
Certificates, and the cost thereof shall be paid out of the funds in the
Collection Account or any Series Account held for the benefit of such
Investor Certificateholders. The Trustee and the Paying Agent shall pay to
the Seller any moneys held by them for the payment of principal or interest
that remains unclaimed for two years. After payment to the Seller,
Investor Certificateholders entitled to the money must look to the Seller
for payment as general creditors unless an applicable abandoned property
law designates another Person.
(a) In the event that the Invested Amount with respect
to any Series is greater than zero on its Series Termination Date or
such earlier date as is specified in the related Supplement (after
giving effect to deposits and distributions otherwise to be made on
such date), the Trustee will sell or cause to be sold on such Series
Termination Date, in accordance with the procedures and subject to
the conditions described in such Supplement, Principal Receivables
and the related Finance Charge Receivables (or interests therein) in
an amount equal to the Invested Amount with respect to such Series on
such date (after giving effect to such deposits and distributions;
provided, however, that in no event shall such amount exceed such
Series' allocable share of Receivables on such Series Termination
Date). The proceeds from any such sale shall be allocated and
distributed in accordance with the terms of the applicable
Supplement.
Seller's Termination Rights
. Upon the termination of the Trust pursuant to Section 12.01
and the surrender of the Seller Certificate and any Supplemental
Certificate, the Trustee shall sell, assign and convey to the Seller or its
designee, without recourse, representation or warranty, all right, title
and interest of the Trust in the Receivables, whether then existing or
thereafter created, all moneys due or to become due and all amounts
received with respect thereto and all proceeds thereof, except for amounts
held by the Trustee pursuant to Section 12.02(b). The Trustee shall
execute and deliver such instruments of transfer and assignment, in each
case without recourse, as shall be reasonably requested by the Seller to
vest in the Seller or its designee all right, title and interest that the
Trust had in the Receivables and such other related assets.
Defeasance
. Notwithstanding anything to the contrary in this Agreement
or any Supplement:
(a) The Seller may at its option be discharged from its
obligations hereunder with respect to any Series or all outstanding
Series (the "Defeased Series") on the date the applicable conditions
set forth in Section 12.04(c) are satisfied ("Defeasance"); provided,
however, that the following rights, obligations, powers, duties and
immunities shall survive with respect to the Defeased Series until
otherwise terminated or discharged hereunder: (i) the rights of
Holders of Investor Certificates of the Defeased Series to receive,
solely from the trust fund provided for in Section 12.04(c), payments
in respect of principal of and interest on such Investor Certificates
when such payments are due; (ii) the Seller's obligations with
respect to such Certificates under Sections 6.04 and 6.05; (iii) the
rights, powers, trusts, duties and immunities of the Trustee, the
Paying Agent and the Transfer Agent and Registrar hereunder; and
(iv) this Section 12.04. Notwithstanding the foregoing, the Seller
may not defease a Series during an Amortization Period for that
Series.
(b) In order to defease a Series, the Seller may direct
the Trustee to apply Collections of Principal Receivables allocated
to the Defeased Series and available to purchase additional
Receivables to be applied to purchase Eligible Investments rather
than additional Receivables.
(c) The following shall be the conditions to Defeasance
under Section 12.04(a): (i) the Seller irrevocably shall have
deposited or caused to be deposited with the Trustee, under the terms
of an irrevocable trust agreement in form and substance satisfactory
to the Trustee, as trust funds in trust for making the payments
described below, Eligible Investments purchased as described in
clause (b) in an amount that through the scheduled payment of
principal and interest in respect thereof will provide, not later
than the due date of payment thereon, money in an amount sufficient
to pay and discharge, and that shall be applied by the Trustee to pay
and discharge, all remaining scheduled interest and principal
payments on all outstanding Investor Certificates of the Defeased
Series on the dates scheduled for such payments in this Agreement and
the applicable Supplements and all amounts owing to the Series
Enhancers with respect to the Defeased Series; (ii) prior to its
first exercise of its right pursuant to this Section 12.04 with
respect to a Defeased Series to substitute money or Eligible
Investments for Receivables, the Seller shall have delivered to the
Trustee a Tax Opinion with respect to such deposit and termination of
obligations and an Opinion of Counsel to the effect that such deposit
and termination of obligations will not result in the Trust being
required to register as an "investment company" within the meaning of
the Investment Company Act; (iii) the Seller shall have delivered to
the Trustee and each Series Enhancer entitled thereto pursuant to the
relevant Supplement an Officer's Certificate of the Seller stating
that the Seller reasonably believes that such deposit and termination
of obligations will not, based on the facts known to such officer at
the time of such certification, then cause a Pay Out Event or any
event that, with the giving of notice or the lapse of time, would
constitute a Pay Out Event to occur with respect to any Series; and
(iv) the Rating Agency Condition has been satisfied.
ARTICLE II
Miscellaneous Provisions
Amendment; Waiver of Past Defaults
. (a) This Agreement or any Supplement may be amended from
time to time by the Servicer, the Seller and the Trustee, without the
consent of any of the Investor Certificateholders including without
limitation in connection with (i) adding covenants, restrictions or
conditions of the Seller, such further covenants, restrictions or
conditions as its Board of Directors and the Trustee shall consider
to be for the benefit or protection of the Investor
Certificateholders, and to make the occurrence, or the occurrence and
continuance, of a default in any of such additional covenants,
restrictions or conditions a default or Pay Out Event permitting the
enforcement of all or any of the several remedies provided in this
Agreement as herein set forth; provided, however, that in respect of
any such additional covenant, restriction or condition such amendment
may provide for a particular period of grace after default or may
provide for an immediate enforcement upon such default or may limit
the remedies available to the Trustee upon such default, (ii) curing
any ambiguity or correcting or supplementing any provision contained
herein or in any Supplement that may be defective or inconsistent
with any other provision contained herein or in any Supplement or to
surrender any right or power conferred upon the Seller, (iii) the
issuance of a Supplemental Certificate, (iv) the addition of a
Participation Interest to the Trust, (v) the assumption by another
entity, in accordance with the provisions of this Agreement, of the
Seller's obligations hereunder, or (vi) the provision of additional
Series Enhancement for the benefit of Certificateholders of any
Series) by the Servicer, the Seller and the Trustee without the
consent of any of the Certificateholders; provided that (x) the
Seller shall have delivered to the Trustee an Officer's Certificate
to the effect that the Seller reasonably believes that such action
shall not adversely affect in any material respect the interests of
any Investor Certificateholder and (y) the Rating Agency Condition
shall have been satisfied with respect to any such amendment. The
designation of additional Sellers pursuant to Section 2.13 shall be
subject to this Section 13.01 only to the extent that the supplement
to this Agreement providing for such designation amends any of the
terms of this Agreement.
This Agreement or any Supplement may also be amended from time
to time by the Servicer, the Seller and the Trustee, with prior written
notice to each Rating Agency and with the consent of the Holders of
Investor Certificates evidencing not less than 662/3% of the aggregate
unpaid principal amount of the Investor Certificates of all adversely
affected Classes, for the purpose of adding any provisions to or changing
in any manner or eliminating any of the provisions of this Agreement or any
Supplement 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 any
distributions to be made to Investor Certificateholders or deposits of
amounts to be so distributed or the amount available under any Series
Enhancement without the consent of each affected Certificateholder
(provided that any amendment of the terms of a Pay Out Event shall not be
deemed to be within the scope of this clause (i)), (ii) change the
definition of or the manner of calculating the interest of any Investor
Certificateholder 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. Any amendment to be effected pursuant to this paragraph
shall be deemed to adversely affect all outstanding Classes, other than any
Classes with respect to which such action shall not, as evidenced by an
Opinion of Counsel for the Seller, addressed and delivered to the Trustee,
adversely affect in any material respect the interests of any Investor
Certificateholder of such Classes. The Trustee may, but shall not be
obligated to, enter into any such amendment that affects the Trustee's
rights, duties or immunities under this Agreement or otherwise.
(a) Promptly after the execution of any such amendment
or consent (other than an amendment pursuant to paragraph (a)), the
Trustee shall furnish notification of the substance of such amendment
to each Investor Certificateholder, and the Servicer shall furnish
notification of the substance of such amendment to each Rating Agency
and each Series Enhancer entitled thereto pursuant to the relevant
Supplement.
(b) It shall not be necessary for the consent of
Investor Certificateholders under this Section 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.
(c) Any Supplement executed in accordance with the
provisions of Section 6.03 shall not be considered an amendment to
this Agreement for the purposes of this Section.
(d) The Holders of Investor Certificates evidencing
more than 662/3% of the aggregate unpaid principal amount of the
Investor Certificates of each Series, or, with respect to any Series
with two or more Classes, of each Class (or, with respect to any
default that does not relate to all Series, 662/3% of the aggregate
unpaid principal amount of the Investor Certificates of each Series
to which such default relates or, with respect to any such Series
with two or more Classes, of each Class) may, on behalf of all
Certificateholders, waive any default by the Seller or the Servicer
in the performance of their obligations hereunder and its
consequences, except the failure to make any distributions required
to be made to Investor Certificateholders or to make any required
deposits of any amounts to be so distributed. Upon any such waiver
of a past default, such default shall cease to exist, and any default
arising therefrom shall be deemed to have been remedied for every
purpose of this Agreement. No such waiver shall extend to any
subsequent or other default or impair any right consequent thereon
except to the extent expressly so waived.
Protection of Right, Title and Interest to Trust
(a) . (a) The Servicer shall cause this Agreement,
all amendments and supplements hereto and all financing statements
and continuation statements and any other necessary documents
covering the Certificateholders' and the Trustee's right, title and
interest to the Trust to be promptly recorded, registered and filed,
and at all times to be kept recorded, registered and filed, all in
such manner and in such places as may be required by law fully to
preserve and protect the right, title and interest of the
Certificateholders and the Trustee hereunder to all property
comprising the Trust Assets. The Servicer shall deliver to the
Trustee filestamped copies of, or filing receipts for, any document
recorded, registered or filed as provided above, as soon as available
following such recording, registration or filing. The Seller shall
cooperate fully 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 paragraph.
(b) Within 30 days after the Seller makes any change in
its name, identity or corporate structure that would make any
financing statement or continuation statement filed in accordance
with paragraph (a) seriously misleading within the meaning of Section
9402(7) (or any comparable provision) of the UCC, the Seller shall
give the Trustee notice of any such change and shall file such
financing statements or amendments as may be necessary to continue
the perfection of the Trust's security interest in the Receivables
and the proceeds thereof.
(c) The Seller and the Servicer will give the Trustee
prompt notice of any relocation of any 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 security
interest in the Receivables and the proceeds thereof. The Seller and
the Servicer will at all times maintain each office from which it
services Receivables and its principal executive offices within the
United States.
(d) The Servicer will deliver to the Trustee and any
Series Enhancer entitled thereto pursuant to the relevant Supplement:
(i) upon the execution and delivery of each amendment of this
Agreement or any Supplement, an Opinion of Counsel to the effect
specified in Exhibit H1; (ii) on each Addition Date on which any
Additional Accounts (other than Automatic Additional Accounts) are to
be designated as Accounts pursuant to Section 2.09(a) or (b), an
Opinion of Counsel substantially in the form of Exhibit H2, and on
each Addition Date on which any Participation Interests are to be
included in the Trust pursuant to Section 2.09(a) or (b), an Opinion
of Counsel covering the same substantive legal issues addressed by
Exhibit H2 but conformed to the extent appropriate to relate to
Participation Interests; and (iii) on or before March 31 of each
year, beginning with March 31, 1996, an Opinion of Counsel
substantially in the form of Exhibit H2.
Limitation on Rights of Certificateholders
(a) . (a) The death or incapacity of any
Certificateholder shall not operate to terminate this Agreement or
the Trust, nor shall such death or incapacity entitle such
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 Investor Certificateholder shall have any right
to vote (except as expressly provided in this Agreement) 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 Investor Certificateholders from
time to time as partners or members of an association, 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 institute any suit,
action or preceding in equity or at law upon or under or with respect
to this Agreement, unless such Investor Certificateholder previously
shall have made, and unless the Holders of Investor Certificates
evidencing more than 50% of the aggregate unpaid principal amount of
all Investor Certificates (or, with respect to any such action, suit
or proceeding that does not relate to all Series, 50% of the
aggregate unpaid principal amount of the Investor Certificates of all
Series to which such action, suit or proceeding relates) shall have
made, a 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 neglected or refused to institute any such
action, suit or proceeding; it being understood and intended, and
being expressly covenanted by each Investor Certificateholder with
every other Investor Certificateholder and the Trustee, that no one
or more Investor 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 other of the Investor Certificates, or
to obtain or seek to obtain priority over or preference to any other
such Investor Certificateholder, or to enforce any right under this
Agreement, except in the manner herein provided and for the equal,
ratable and common benefit of all Investor Certificateholders except
as otherwise expressly provided in this Agreement. For the
protection and enforcement of the provisions of this Section, each
and every Investor Certificateholder and the Trustee shall be
entitled to such relief as can be given either at law or in equity.
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, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Notices, Payments
(a) . (a) All demands, notices, instructions,
directions and communications (collectively, "Notices") under this
Agreement shall be in writing and shall be deemed to have been duly
given if personally delivered at, mailed by registered mail, return
receipt requested, or sent by facsimile transmission (i) in the case
of the Seller, to Neiman Marcus Funding Corporation, c/o The Neiman
Marcus Group, Inc., 00 Xxxxxxxx Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxxxxxxx
00000, Attention of the General Counsel (facsimile no. 000-000-0000),
with a copy to Neiman Marcus Funding Corporation, 0000 Xxx Xxxxxx,
Xxxxxx, Xxxxx 00000, Attention of the President (facsimile
no. 214761-2650), (ii) in the case of the Servicer, to The Neiman
Marcus Group, Inc., 00 Xxxxxxxx Xxxxxx, Xxxxxxxx Xxxx, Xxxxxxxxxxxxx
00000, Attention of the General Counsel (facsimile no. 000-000-0000),
(iii) in the case of the Trustee, to The Bank of New York, 000
Xxxxxxx Xxxxxx, Xxxxx 00X, Xxx Xxxx, Xxx Xxxx, 00000, Attention:
Corporate Trust Administration Asset-Backed Finance Unit
(facsimile 212/815-5544), (iv) in the case of Xxxxx'x, to 00 Xxxxxx
Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention of ABS Monitoring
Department 4th Floor (facsimile no. 2125534600), (v) in the case of
Standard & Poor's, to 00 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention of Asset Backed Group (facsimile no. 2124120323), (vi) in
the case of the Paying Agent or the Transfer Agent and Registrar, to
The Bank of New York , 000 Xxxxxxx Xxxxxx, Xxxxx 00X, Xxx Xxxx, Xxx
Xxxx, 00000, Attention: Corporate Trust Administration Asset-
Backed Finance Unit (facsimile 212/815-5544) and (vii) to any other
Person as specified in any Supplement; or, 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.
(b) Any Notice required or permitted to be given to a
Holder of Registered Certificates shall be given by firstclass mail,
postage prepaid, at the address of such Holder as shown in the
Certificate Register. No Notice shall be required to be mailed to a
Holder of Bearer Certificates or Coupons but shall be given as
provided below. Any Notice so mailed within the time prescribed in
this Agreement shall be conclusively presumed to have been duly
given, whether or not the Investor Certificateholder receives such
Notice. In addition, (a) if and so long as any Series or Class is
listed on the Luxembourg Stock Exchange and such Exchange shall so
require, any Notice to Investor Certificateholders shall be published
in an Authorized Newspaper of general circulation in Luxembourg
within the time period prescribed in this Agreement and (b) in the
case of any Series or Class with respect to which any Bearer
Certificates are outstanding, any Notice required or permitted to be
given to Investor Certificateholders of such Series or Class shall be
published in an Authorized Newspaper within the time period
prescribed in this Agreement.
Rule 144A Information
. For so long as any of the Investor Certificates of any
Series or Class are "restricted securities" within the meaning of Rule
144(a)(3) under the Act, each of the Seller, the Trustee, the Servicer and
any Series Enhancer agree to cooperate with each other to provide to any
Investor Certificateholders of such Series or Class and to any prospective
purchaser of Certificates designated by such 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.
Severability of Provisions
. If any one or more of the covenants, agreements, provisions
or terms of this Agreement shall for any reason whatsoever be held invalid,
then such provisions shall be deemed severable from the remaining
provisions of this Agreement and shall in no way affect the validity or
enforceability of the remaining provisions or of the Certificates or the
rights of the Certificateholders.
Assignment
. Notwithstanding anything to the contrary contained herein,
except as provided in Article VIII, this Agreement may not be assigned by
the Servicer without the prior consent of Holders of Investor Certificates
evidencing not less than 662/3% of the aggregate unpaid principal amount of
all outstanding Investor Certificates.
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.
Further Assurances
. The Seller and the Servicer agree to do and perform, from
time to time, any and all acts and to execute any and all further
instruments required or reasonably requested by the Trustee more fully to
effect the purposes of this Agreement, 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.
Nonpetition Covenant
. Notwithstanding any prior termination of this Agreement, the
Servicer, the Trustee, the Seller, each Series Enhancer and each Holder of
a Supplemental Certificate shall not, prior to the date that is one year
and one day after the termination of this Agreement with respect to the
Trust or the Seller, acquiesce, petition or otherwise invoke or cause the
Trust or the Seller to invoke the process of any Governmental Authority for
the purpose of commencing or sustaining a case against the Trust or the
Seller 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 Seller or any
substantial part of their respective property or ordering the windingup or
liquidation of the affairs of the Trust or the Seller.
No Waiver; Cumulative Remedies
. No failure to exercise and no delay in exercising, on the
part of the Trustee or the Certificateholders, 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.
Counterparts
. This Agreement may be executed in two or more counterparts
(and by different parties on separate counterparts), each of which shall be
an original, but all of which together shall constitute one and the same
instrument.
Third-Party Beneficiaries
. This Agreement will inure to the benefit of and be binding
upon the parties hereto, the Certificateholders, any Series Enhancer (to
the extent provided in this Agreement and the related Supplement) and their
respective successors and permitted assigns. Except as otherwise expressly
provided in this Agreement (including, without limitation, Section 7.04),
no other Person will have any right or obligation hereunder.
Actions by Certificateholders
(a) . (a) Wherever in this Agreement a provision is
made that an action may be taken or a Notice given by
Certificateholders, such action or Notice may be taken or given by
any Certificateholder, unless such provision requires a specific
percentage of Certificateholders.
(b) Any Notice, request, authorization, direction,
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.
Merger and Integration
. Except as specifically stated otherwise herein, this
Agreement sets forth the entire understanding of the parties relating to
the subject matter hereof, and all prior understandings, written or oral,
are superseded by this Agreement. This Agreement may not be modified,
amended, waived or supplemented except as provided herein.
Headings
. The headings herein are for purposes of reference only and
shall not otherwise affect the meaning or interpretation of any provision
hereof.
No Proceedings
. Each of the Trustee, the Seller, the Servicer, and each
Certificateholder by acceptance of its Certificate, hereby agrees that it
will not institute against the Holder of the Seller Certificate, or join
any other Person in instituting against the Holder of the Seller
Certificate, on account of its ownership of the Seller Certificate or its
obligations hereunder, any bankruptcy, insolvency, liquidation,
readjustment of debt, marshalling of assets or any similar proceeding so
long as there shall not have elapsed one year plus one day since the last
day on which any Investor Certificates shall have been outstanding.
IN WITNESS WHEREOF, the Seller, the Servicer and the Trustee
have caused this Agreement to be duly executed by their respective officers
as of the day and year first above written.
NEIMAN MARCUS FUNDING
CORPORATION, as Seller,
By:
Name: Xxxx X. Xxxxxxx
Title: Vice President and Treasurer
THE NEIMAN MARCUS GROUP, INC., as Servicer,
By:
Name: Xxxx X. Xxxxxxx
Title: Vice President and Treasurer
THE BANK OF NEW YORK , as Trustee,
By:
Name: Xxxx
Squinteri Title: Assistant Vice
President
EXHIBIT A
FORM OF SELLER CERTIFICATE
THIS SELLER CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. NEITHER THIS SELLER CERTIFICATE NOR ANY
PORTION HEREOF MAY BE OFFERED OR SOLD EXCEPT IN COMPLIANCE WITH THE
REGISTRATION PROVISIONS OF SUCH ACT OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM SUCH REGISTRATION PROVISIONS.
THIS SELLER CERTIFICATE IS NOT PERMITTED TO BE TRANSFERRED,
ASSIGNED, EXCHANGED OR OTHERWISE PLEDGED OR CONVEYED EXCEPT IN COMPLIANCE
WITH THE TERMS OF THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
No. R-1
One Unit
Neiman Marcus Group Credit Card Master TrustSELLER CERTIFICATE
THIS CERTIFICATE REPRESENTS AN INTERESTIN CERTAIN ASSETS OF THENEIMAN MARCUS
GROUP CREDIT CARD MASTER TRUST
Evidencing an interest in a trust, the corpus of which consists
primarily of receivables generated from time to time in the ordinary course
of business in a portfolio of revolving accounts owned by The Neiman Marcus
Group, Inc. (the "Seller").
(Not an interest in or obligation of the Selleror any affiliate thereof)
This certifies that NEIMAN MARCUS FUNDING CORPORATION is the
registered owner of a fractional interest in the assets of a trust (the
"Trust") not allocated to the Certificateholders' Interest or the interest of
any Holder of a Supplemental Certificate pursuant to the Pooling and
Servicing Agreement dated as of March 1, 1995 and amended and restated as of
July 2, 2000 (as amended and supplemented, the "Agreement"), among Neiman
Marcus Funding Corporation, a Delaware corporation, as Seller, The Neiman
Marcus Group, Inc., a Delaware corporation, as Servicer, and The Bank of New
York , a New York banking corporation, as trustee (the "Trustee"). The
corpus of the Trust consists of (i) a portfolio of all receivables (the
"Receivables") existing in the revolving credit card accounts or other
consumer revolving credit or installment accounts identified under the
Agreement from time to time (the "Accounts"), (ii) all Receivables generated
under the Accounts from time to time thereafter, (iii) funds collected or to
be collected from accountholders in respect of the Receivables, (iv) all
funds which are from time to time on deposit in the Collection Account,
Excess Funding Account and in the Series Accounts, (v) the benefits of any
Series Enhancements issued and to be issued by Series Enhancers with respect
to one or more Series of Investor Certificates and (vi) all other assets and
interests constituting the Trust. Although a summary of certain provisions
of the Agreement is set forth below, this Certificate does not purport to
summarize 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. A copy of the Agreement may be requested from the Trustee by
writing to the Trustee at 0 Xxxxxxxxx Xxxxxx, Xxxxxxxx, Xxx Xxxx 00000,
Attention of Corporate Trust Administration. To the extent not defined
herein, the capitalized terms used herein have the meanings ascribed to them
in the Agreement.
This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement, as amended
and supplemented from time to time, the Holder of this Certificate by virtue
of the acceptance hereof assents and is bound.
The Receivables consist of Principal Receivables which arise
generally from the purchase of merchandise and services and Finance Charge
Receivables which arise generally from Periodic Finance Charges, Late Fees
and other fees and charges with respect to the Accounts.
This Certificate is the Seller Certificate, which represents the
Seller's interest in certain assets of the Trust, including the right to
receive a portion of the Collections and other amounts at the times and in
the amounts specified in the Agreement. The aggregate interest represented
by the Seller Certificate at any time in the Receivables in the Trust shall
not exceed the Seller's Interest at such time. In addition to the Seller
Certificate, (i) Investor Certificates will be issued to investors pursuant
to the Agreement, which will represent the Certificateholders' Interest, and
(ii) Supplemental Certificates may be issued pursuant to the Agreement, which
will represent that portion of the Seller's Interest not allocated to the
Holder of the Seller Certificate. This Seller Certificate shall not
represent any interest in the Collection Account, the Excess Funding Account
or the Series Accounts, except as expressly provided in the Agreement, or any
Series Enhancements.
The Seller has entered into the Agreement, and this Certificate
is issued, with the intention that, for Federal, state and local income and
franchise tax purposes only, the Investor Certificates (except Seller
Retained Certificates which are held by the Seller) will qualify as debt
secured by the Receivables. The Seller, by entering into the Agreement and
the Holder of the Seller Certificate by acceptance of this Seller
Certificate, agree to treat such Investor Certificates for Federal, state and
local income and franchise tax purposes as debt under applicable tax law.
Subject to certain conditions and exceptions specified in the
Agreement, the obligations created by the Agreement and the Trust created
thereby shall terminate upon the earlier of (i) March 1, 2015 and (ii) the
day following the Distribution Date on which the Invested Amount and
Enhancement Invested Amount for each Series is zero (provided the Seller has
delivered a written notice to the Trustee electing to terminate the Trust).
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.
IN WITNESS WHEREOF, the Holder of the Seller Certificate has
caused this Certificate to be duly executed.
NEIMAN MARCUS FUNDING CORPORATION, as
Seller,
By:
Name: Title:
Dated: July __, 2000
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is the Seller Certificate described in the within-mentioned
Agreement.
THE BANK OF NEW YORK ,
as Trustee,
By
Authorized Signatory
or
By [_______________________],
as Authenticating Agent
for the Trustee,
By ________________________
Authorized Signatory
EXHIBIT B
FORM OF ASSIGNMENT OF RECEIVABLES IN ADDITIONAL ACCOUNTS
(As required by Section 2.09 ofThe Pooling and Servicing Agreement)
ASSIGNMENT No. ________ OF RECEIVABLES IN ADDITIONAL ACCOUNTS
dated as of ________, /, by and among NEIMAN MARCUS FUNDING CORPORATION, a
Delaware corporation, as Seller (the "Seller"), THE NEIMAN MARCUS GROUP,
INC., as Servicer (the "Servicer"), and THE BANK OF NEW YORK, (as successor
to The Chase Manhattan Bank, N.A.) a New York banking corporation (the
"Trustee"), pursuant to the Pooling and Servicing Agreement referred to
below.
WITNESSETH
WHEREAS the Seller, the Servicer and the Trustee are parties to
the Pooling and Servicing Agreement dated as of March 1, 1995 and amended and
restated as of July 2, 2000 (as may be amended and supplemented from time to
time, the "Agreement");
WHEREAS, pursuant to the Agreement, the Seller wishes to
designate Additional Accounts owned by one or more Account Originators to be
included as Accounts and to convey the Receivables of such Additional
Accounts, whether now existing or hereafter created, to the Trust as part of
the corpus of the Trust (as each such term is defined in the Agreement); and
WHEREAS the Trustee is willing to accept such designation and
conveyance subject to the terms and conditions hereof;
NOW, THEREFORE, the Seller, the Servicer and the Trustee hereby
agree as follows:
1. Defined Terms. All capitalized terms used herein shall
have the meanings ascribed to them in the Agreement unless otherwise defined
herein.
"Addition Date" shall mean, with respect to the Additional
Accounts designated hereby, ________, ____.
"Addition Cut-Off Date" shall mean, with respect to the
Additional Accounts designated hereby, ________, ____.
2. Designation of Additional Accounts. On or before the
Document Delivery Date, the Seller will deliver to the Trustee a computer
file, microfiche list or printed list containing a true and complete schedule
identifying all such Additional Accounts specifying for each such 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
outstanding in such Account, which computer file, microfiche list or printed
list shall supplement Schedule I to the Agreement.
3. Conveyance of Receivables. (a) The Seller does hereby
sell, transfer, assign, set over and otherwise convey to the Trust, for the
benefit of the Certificateholders, all its right, title and interest in, to
and under the Receivables of such Additional Accounts existing at the close
of business on the Addition Date and thereafter created from time to time
until the termination of the Trust, all monies due or to become due and all
amounts received with respect thereto and all proceeds (including "proceeds"
as defined in the UCC) thereof. The foregoing does not constitute and is not
intended to result in the creation or assumption by the Trust, the Trustee,
any Investor Certificateholder or any Series Enhancer of any obligation of
the Servicer, the Seller, any Account Originator or any other Person in
connection with the Accounts, the Receivables or under any agreement or
instrument relating thereto, including any obligation to Obligors, merchant
banks, merchants clearance systems or insurers.
(b) The Seller agrees to record and file, at its own expense,
financing statements (and continuation statements when applicable) with
respect to the Receivables now in Additional Accounts, meeting the
requirements of applicable state law in such manner and in such jurisdictions
as are necessary to perfect, and maintain perfection of, the sale and
assignment of such Receivables to the Trust, and to deliver a filestamped
copy of each such financing statement or other evidence of such filing to the
Trustee on or prior to the Addition Date. The Trustee shall be under no
obligation whatsoever to file such financing or continuation statements or to
make any other filing under the UCC in connection with such sale and
assignment.
(c) In connection with such sale, the Seller further agrees,
at its own expense, on or prior to the date of this Assignment, to cause each
applicable Account Originator to indicate in the appropriate computer files
that Receivables created in connection with the Additional Accounts and
designated hereby have been conveyed to the Trust pursuant to the Agreement
and this Assignment for the benefit of the Certificateholders.
(d) The Seller does hereby grant to the Trustee a security
interest in all of its right, title and interest in and to the Receivables
now existing and hereafter created in the Additional Accounts, all monies due
or to become due and all amounts received with respect thereto and all
"proceeds" (including "proceeds" as defined in the UCC) thereof. This
Assignment constitutes a security agreement under the UCC.
4. Acceptance by Trustee. The Trustee hereby acknowledges
its acceptance on behalf of the Trust of all right, title and interest to
the property, now existing and hereafter created, conveyed to the Trust
pursuant to Section 3(a) of this Assignment, and declares that it shall
maintain such right, title and interest, upon the trust set forth in the
Agreement for the benefit of all Certificateholders. The Trustee further
acknowledges that, prior to or simultaneously with the execution and
delivery of this Assignment, the Seller delivered to the Trustee the
computer file, microfiche list or printed list described in Section 2 of
this Assignment.
5. Representations and Warranties of the Seller. The Seller
hereby represents and warrants to the Trustee, on behalf of the Trust, as of
the date of this Assignment and as of the Addition Date that:
(a) Legal, Valid and Binding Obligation. This
Assignment 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
bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect affecting the enforcement of
creditors' rights in general and except as such enforceability may be
limited by general principles of equity (whether considered in a suit
at law or in equity);
(b) Eligibility of Accounts. Each Additional
Account designated hereby is an Eligible Account;
(c) Insolvency. As of each of the Addition Cut-
Off Date and the Addition Date, no Insolvency Event with respect to
any applicable Account Originator or the Seller has occurred and the
transfer by the Seller of Receivables arising in the Additional
Accounts to the Trust has not been made in contemplation of the
occurrence thereof;
(d) Pay Out Event. The Seller reasonably
believes that (A) the addition of the Receivables arising in the
Additional Accounts will not, based on the facts known to the Seller,
then or thereafter cause a Pay Out Event to occur with respect to any
Series and (B) no selection procedure was utilized by the Seller
which would result in the selection of Additional Accounts (from
among the available Eligible Accounts owned by each applicable
Account Originator) that would be materially adverse to the interests
of the Investor Certificateholders of any Series as of the Addition
Date;
(e) Security Interest. This Assignment
constitutes a valid transfer and assignment to the Trust of all
right, title and interest of the Seller in the Receivables and other
Trust Assets conveyed to the Trust by the Seller and all monies due
or to become due and all amounts received with respect thereto and
the proceeds as defined in the UCC, and this Assignment constitutes a
grant of a "security interest" (as defined in the UCC) in such
property to the Trust, which, in the case of existing Receivables and
the proceeds thereof, is enforceable upon execution and delivery of
this Assignment, and which will be enforceable with respect to such
Receivables hereafter created and the proceeds thereof upon such
creation. Upon the filing of the financing statements described in
Section 3 of this Assignment and, in the case of the Receivables
hereafter created and the proceeds thereof, upon the creation
thereof, the Trust shall have a first priority security interest in
such property except for Liens permitted under Section 2.07(b) of the
Agreement;
(f) No Conflict. The execution and delivery by
the Seller of this Assignment, the performance of the transactions
contemplated by this Assignment 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 or conflict with,
result in any breach of any of the material terms and provisions of,
or constitute (with or without notice or lapse of time or both) a
material default under, any indenture, contract, agreement, mortgage,
deed of trust or other instrument to which the Seller is a party or
by which it or its properties are bound;
(g) 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 tribunal or governmental
instrumentality (i) asserting the invalidity of this Assignment,
(ii) seeking to prevent the consummation of any of the transactions
contemplated by this Assignment, (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 Assignment, (iv) seeking any determination or
ruling that would materially and adversely affect the validity or
enforceability of this Assignment or (v) seeking to affect adversely
the income tax attributes of the Trust under the Federal, or
applicable state income or franchise tax systems; and
(h) All Consents. All authorizations, consents,
orders or approvals or other actions of any Person or of any court or
other governmental authority required to be obtained by the Seller in
connection with the execution and delivery of this Assignment by the
Seller and the performance of the transactions contemplated by this
Assignment by the Seller, have been obtained.
6. Ratification of Agreement. As supplemented by this
Assignment, the Agreement is in all respects ratified and confirmed and the
Agreement as so supplemented by this Assignment shall be read, taken and
construed as one and the same instrument.
7. Counterparts. This Assignment may be executed in two or
more counterparts, and by different parties on separate counterparts, each of
which shall be an original, but all of which shall constitute one and the
same instrument.
8. GOVERNING LAW. THIS ASSIGNMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
IN WITNESS
WHEREOF, the Seller, the Servicer and the Trustee
have caused this Assignment to be duly executed by their respective officers
as of the day and year first above written.
NEIMAN MARCUS FUNDING CORPORATION,as
Seller,
By
Name:Title:
THE NEIMAN MARCUS GROUP, INC., as
Servicer,
By
Name:Title:
THE BANK OF NEW YORK , as Trustee
By
Name:Title:
EXHIBIT C
FORM OF REASSIGNMENT OF RECEIVABLES IN REMOVED ACCOUNTS(As required by
Section 2.10 ofthe Pooling and Servicing Agreement)
REASSIGNMENT No. OF RECEIVABLES dated as of __________,/ by and
among NEIMAN MARCUS FUNDING CORPORATION, a Delaware corporation, as Seller
(the "Seller"), THE NEIMAN MARCUS GROUP, INC., a Delaware corporation, as
Servicer (the "Servicer") and THE BANK OF NEW YORK (as successor to The
Chase Manhattan Bank, N.A.), a New York banking corporation (the
"Trustee"), pursuant to the Pooling and Servicing Agreement referred to
below.
WITNESSETH:
WHEREAS the Seller, the Servicer and the Trustee are parties to the
Pooling and Servicing Agreement dated as of March 1, 1995 and amended and
restated as of July 2, 2000 (as may be amended and supplemented from time
to time, the "Agreement");
WHEREAS pursuant to the Agreement, the Seller wishes to remove from
the Trust all Receivables in certain designated Accounts (the "Removed
Accounts") and to cause the Trustee to reconvey the Receivables of such
Removed Accounts, whether now existing or hereafter created, from the Trust
to the Seller; and
WHEREAS the Trustee is willing to accept such designation and to
reconvey the Receivables in the Removed Accounts subject to the terms and
conditions hereof;
NOW, THEREFORE, the Seller, the Servicer and the Trustee hereby agree
as follows:
1. Defined Terms. All terms defined in the Agreement and
used herein shall have such defined meanings when used herein, unless
otherwise defined herein.
"Removal Date" shall mean, with respect to the Removed Accounts
designated hereby, , .
"Removal Notice Date" shall mean, with respect to the Removed
Accounts, __________ , .
2. Designation of Removed Accounts. On or before the date
that is 10 Business Days after the Removal Date, the Seller will deliver to
the Trustee a computer file, microfiche list or printed list containing a
true and complete schedule identifying all Accounts the Receivables of
which are being removed from the Trust, specifying for each such Account,
as of the Removal Notice Date, its account number, the aggregate amount
outstanding in such Account and the aggregate amount of Principal
Receivables in such Account, which computer file, microfiche list or
printed list shall supplement Schedule 1 to the Agreement.
3. Conveyance of Receivables. (a) The Trustee does hereby
transfer, assign, set over and otherwise convey to the Seller, without
recourse, on and after the Removal Date, all right, title and interest of
the Trust in, to and under the Receivables existing at the close of
business on the Removal Date and thereafter created from time to time in
the Removed Accounts designated hereby, all monies due or to become due and
all amounts received with respect thereto and all proceeds thereof.
(b) In connection with such transfer, the Trustee agrees to
execute and deliver to the Seller on or prior to the date this Reassignment
is delivered, applicable termination statements with respect to the
Receivables existing at the close of business on the Removal Date and
thereafter created from time to time in the Removed Accounts reassigned
hereby and the proceeds thereof evidencing the release by the Trust of its
interest in the Receivables in the Removed Accounts, and meeting the
requirements of applicable state law, in such manner and such jurisdictions
as are necessary to terminate such interest.
4. Representations and Warranties of the Seller. The
Seller hereby represents and warrants to the Trustee, on behalf of the
Trust, as of the Removal Date:
(a) Legal, Valid and Binding Obligation. This Reassignment
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 bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
affecting the enforcement of creditors' rights in general and except as
such enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity);
(b) Pay Out Event. The Seller reasonably believes that (A)
the removal of the Receivables existing in the Removed Accounts will not,
based on the facts known to the Seller, then or thereafter cause a Pay Out
Event to occur with respect to any Series and (B) no selection procedure
was utilized by the Seller which would result in a selection of Removed
Accounts that would be materially adverse to the interests of the Investor
Certificateholders of any Series as of the Removal Date; and
(c) List of Removed Accounts. The list of Removed Accounts
delivered pursuant to Section 2.10(c) of the Agreement, as of the Removal
Date, is true and complete in all material respects.
(d) Defaulted Receivables. No selection procedure was
utilized by the Seller with the intent to include a disproportionately
higher level of Defaulted Receivables in the Removed Accounts than exist in
the Accounts or to remove Accounts for the intended purpose of mitigating
losses to the Trust.
5. Ratification of Agreement. As supplemented by this
Reassignment, the Agreement is in all respects ratified and confirmed and
the Agreement as so supplemented by this Reassignment shall be read, taken
and construed as one and the same instrument.
6. Counterparts. This Reassignment may be executed in two
or more counterparts, and by different parties on separate counterparts,
each of which shall be an original, but all of which shall constitute one
and the same instrument.
7. GOVERNING LAW. THIS REASSIGNMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
IN WITNESS WHEREOF, the Seller, the Servicer and the Trustee
have caused this Reassignment to be duly executed by their respective
officers as of the day and year first above written.
NEIMAN MARCUS FUNDING CORPORATION,
as Seller,
By
Name:Title:
THE NEIMAN MARCUS GROUP, INC., as
Servicer,
By
Name:Title:
THE BANK OF NEW YORK , as Trustee
By
Name:Title:
EXHIBIT D
FORM OF ANNUAL SERVICER'S CERTIFICATE
(To be delivered on or before October 31 ofeach calendar year beginning
with October 31, 1995,pursuant to Section 3.05 of the Pooling andServicing
Agreement referred to below)
NEIMAN MARCUS GROUP
NEIMAN MARCUS GROUP CREDIT CARD MASTER TRUST
The undersigned, a duly authorized representative of The Neiman
Marcus Group, Inc., as Servicer ("NMG"), pursuant to the Pooling and
Servicing Agreement dated as of March 1, 1995 and amended and restated as
of July 2, 2000 (as may be amended and supplemented from time to time, the
"Agreement"), among Neiman Marcus Funding Corporation, as Seller, NMG as
Servicer, and The Bank of New York (as successor to The Chase Manhattan
Bank, N.A.), as Trustee, does hereby certify that:
1. NMG is, as of the date hereof, the Servicer under the
Agreement. Capitalized terms used in this Certificate have their
respective meanings as set forth in the Agreement.
2. The undersigned is a Servicing Officer who is duly
authorized pursuant to the Agreement to execute and deliver this
Certificate to the Trustee.
3. A review of the activities of the Servicer during the
fiscal year ended _________, , and of its performance under the
Agreement was conducted under my supervision.
4. Based on such review, the Servicer has, to the best of my
knowledge, performed in all material respects its obligations under the
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
Agreement known to me to have been made by the Servicer during the fiscal
year ended , , which sets forth in detail (i) the
nature of each such default, (ii) the action taken by the Servicer, if any,
to remedy each such default and (iii) the current status of each such
default: [If applicable, insert "None."]
IN WITNESS WHEREOF, the undersigned
has duly executed this Certificate this ____ day of ________, 20____.
NEIMAN MARCUS GROUP, INC.,
as Servicer,
By
Name:Title:
EXHIBIT E-1-A
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "1933 ACT"). NEITHER THIS CERTIFICATE NOR ANY PORTION
HEREOF MAY BE OFFERED, SOLD, PLEDGED, OR OTHERWISE TRANSFERRED EXCEPT IN
COMPLIANCE WITH THE REGISTRATION PROVISIONS OF THE 1933 ACT AND ANY
APPLICABLE PROVISIONS OF ANY STATE BLUE SKY OR SECURITIES LAWS OR PURSUANT
TO AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION PROVISIONS. THE TRANSFER
OF THIS CERTIFICATE IS SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE
POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
EXHIBIT E-1-B
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A BENEFIT
PLAN (AS DEFINED BELOW).
EXHIBIT E-2
[FORM OF UNDERTAKING LETTER]
[Date]
[
Attention: ]
Neiman Marcus Funding Corporation
0000 Xxx Xxxxxx
Xxxxxx, Xxxxx 00000
Attention: General Counsel
Re: Purchase of $___________/ principal amount of Neiman Marcus
Group Credit Card Master Trust, [Class ___], [ %] [Floating
Rate] Asset Backed Certificates, Series [ ]
Dear Sirs:
In connection with our purchase of the above-referenced Asset Backed
Certificates (the "Certificates") we confirm that:
(i) we understand that the Certificates are not being registered
under the Securities Act of 1933, as amended (the "1933 Act"), and are
being sold to us in a transaction that is exempt from the registration
requirements of the 1933 Act;
(ii) any information we desire concerning the Certificates or any
other matter relevant to our decision to purchase the certificates is or
has been made available to us;
(iii) we have such knowledge and experience in financial and business
matters as to be capable of evaluating the merits and risks of an
investment in the Certificates, and we (and any account for which we are
purchasing under paragraph (iv) below) are able to bear the economic risk
of an investment in the Certificates; we (and any account for which we are
purchasing under paragraph (iv) below) are an "accredited investor" (as
such term is defined in Rule 501(a)(1), (2) or (3) of Regulation D under
the 0000 Xxx); and we are not, and none of such accounts is, a Benefit
Plan;
(iv) we are acquiring the Certificates for our own account or for
accounts as to which we exercise sole investment discretion and not with a
view to any distribution of the Certificates, subject, nevertheless, to the
understanding that the disposition of our property shall at all times be
and remain within our control;
(v) we agree that the Certificates must be held indefinitely by us
unless subsequently registered under the 1933 Act or an exemption from any
registration requirements of that Act and any applicable state securities
laws available;
(vi) we agree that in the event that at some future time we wish to
dispose of or exchange any of the Certificates (such disposition or
exchange not being currently foreseen or contemplated), we will not
transfer or exchange any of the Certificates unless
(A)(1) the sale is of at least U.S. $100,000 principal amount
of Certificates to an Eligible Purchaser (as defined below), (2) a
letter to substantially the same effect as paragraphs (i), (ii),
(iii), (iv), (v) and (vi) of this letter is executed promptly by the
purchaser and (3) all offers or solicitations in connection with the
sale, whether directly or through any agent acting on our behalf, are
limited only to Eligible Purchasers and are not made by means of any
form of general solicitation or general advertising whatsoever; or
(B) the Certificates are transferred pursuant to Rule 144
under the 1933 Act by us after we have held them for more than three
years; or
(C) the Certificates are sold in any other transaction that
does not require registration under the 1933 Act and, if the Seller,
the Servicer, the Trustee or the Transfer Agent and Registrar so
requests, we theretofore have furnished to such party an opinion of
counsel satisfactory to such party, in form and substance
satisfactory to such party, to such effect; or
(D) the Certificates are transferred pursuant to an exception
from the registration requirements of the 1933 Act under Rule 144A
under the 1933 Act; and
we understand that the Certificates will bear a legend to
substantially the following effect:
"THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT").
NEITHER THIS CERTIFICATE NOR ANY PORTION HEREOF MAY BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN
COMPLIANCE WITH THE REGISTRATION PROVISIONS OF THE 1933
ACT AND ANY APPLICABLE PROVISIONS OF ANY STATE BLUE SKY
OR SECURITIES LAWS OR PURSUANT TO AN AVAILABLE EXEMPTION
FROM SUCH REGISTRATION PROVISIONS. THE TRANSFER OF THIS
CERTIFICATE IS SUBJECT TO CERTAIN CONDITIONS SET FORTH IN
THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN."
["THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR
THE ACCOUNT OF A BENEFIT PLAN (AS DEFINED BELOW)."]
The first paragraph of this legend may be removed if the Seller, the
Servicer, the Trustee and the Transfer Agent and Registrar have received an
opinion of counsel satisfactory to them, in form and substance satisfactory
to them, to the effect that such paragraph may be removed.
"Eligible Purchaser" means either an Eligible Dealer or a
corporation, partnership or other entity which we have reasonable grounds
to believe and do believe can make representations with respect to itself
to substantially the same effect as the representations set forth herein.
"Eligible Dealer" means any corporation or other entity the principal
business of which is acting as a broker and/or dealer in securities.
["Benefit Plan" means (a) any employee benefit plan or other plan, trust or
account (including an individual retirement account) that is subject to the
Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or
Section 4975 of the Internal Revenue Code of 1986, as amended, or (b) any
collective investment fund, insurance company separate or general account
or other entity (except an entity registered under the Investment Company
Act of 1940, as amended) whose underlying assets include "plan assets"
under ERISA by reason of a plan's investment in such entity.] Capitalized
terms used but not defined herein shall have the meanings given to such
terms in the Pooling and Servicing Agreement, dated as of March 1, 1995 and
Amended and Restated as of July 2, 2000, among Neiman Marcus Funding
Corporation, The Neiman Marcus Group, Inc. and The Bank of New York, as
Trustee.
Very truly yours,
(Name of Purchaser)
By
(Authorized Officer)
EXHIBIT E-3
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A BENEFIT
PLAN (AS DEFINED BELOW)./
EXHIBIT F
Examples of Account Agreements
EXHIBIT G
RESERVED.
EXHIBIT H1
FORM OF OPINION OF COUNSELWITH RESPECT TO AMENDMENTS
Provisions to be included inOpinion of Counsel to be delivered pursuantto
Section 13.02(d)(i)
The opinions set forth below may be subject to all the
qualifications, assumptions, limitations and exceptions taken or made in
the Opinions Of Counsel delivered on any applicable Closing Date.
(i) The amendment to the [Pooling and Servicing Agreement],
[Supplement], attached hereto as Schedule 1 (the "Amendment" ), has been
duly authorized, executed and delivered by the Seller and the Servicer and
constitutes the legal, valid and binding agreement of the Seller and the
Servicer, respectively, enforceable in accordance with its terms, except as
such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws from time to time in effect
affecting creditors' rights generally or the rights of creditors of New
York banking corporations. The enforceability of the respective
obligations of the Seller and the Servicer is also subject to general
principles of equity (regardless of whether such enforceability is
considered in a proceeding in equity or at law)
(ii) The Amendment has been entered into in accordance with
the terms and provisions of Section 13.01 of the Pooling and Servicing
Agreement.
EXHIBIT H-2
FORM OF OPINION OF COUNSELWITH RESPECT TO ACCOUNTS
Provisions to be included inOpinion of Counsel to bedelivered pursuant
toSection 13.02(d)(ii) or (iii)
The opinions set forth below may be subject to appropriate
qualifications, assumptions, limitations and exceptions. Paragraphs 1-3
are not required if the opinion is being delivered solely under Section
13.02(d)(iii).
1. The Receivables arising in such Additional Accounts constitute
either "general intangibles," "accounts" or "chattel paper," in each case
as defined under Section 9106 of the UCC.
2. The Pooling and Servicing Agreement creates in favor of the
Trust a security interest in the Seller's rights in the Receivables in such
Additional Accounts and the proceeds thereof.
3. The security interest described in paragraph 2 is perfected and
of first priority under the UCC.
4. No further filings or actions are required under the UCC prior to
March 31, _____, in order to maintain the perfection and priority of the
security interest created by the Pooling and Servicing Agreement in favor
of the Trust in the Seller's rights in the Receivables and the proceeds
thereof.
SCHEDULE 1
List of Accounts
[Original list delivered to Trustee]
