EXHIBIT 4.1
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PEOPLE'S BANK
Seller and Servicer
and
BANKERS TRUST COMPANY
Trustee
on behalf of the Certificateholders
of the People's Bank Credit Card Master Trust
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AMENDED AND RESTATED
POOLING AND SERVICING AGREEMENT
Dated as of March [ ], 1997
amending and restating in its entirety
the Pooling and Servicing Agreement
Dated as of June 1, 1993
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TABLE OF CONTENTS
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ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions...................................... 1
SECTION 1.2 Other Definitional Provisions.................... 23
ARTICLE II
CONVEYANCE OF RECEIVABLES;
ISSUANCE OF CERTIFICATES
SECTION 2.1 Conveyance of Receivables...................... 24
SECTION 2.2 Acceptance by Trustee.......................... 26
SECTION 2.3 Representations and Warranties of the Seller... 27
SECTION 2.4 Representations and Warranties of the Seller
Relating to the Agreement and the Receivables 29
SECTION 2.5 Covenants of the Seller........................ 38
SECTION 2.6 Addition of Accounts........................... 43
SECTION 2.7 Removal of Accounts............................ 47
SECTION 2.8 Periodic Removal of Expired Accounts........... 50
ARTICLE III
ADMINISTRATION AND SERVICING
OF RECEIVABLES
SECTION 3.1 Acceptance of Appointment and Other Matters
Relating to the Servicer...................... 54
SECTION 3.2 Servicing Compensation.......................... 55
SECTION 3.3 Representations and Warranties of the Servicer.. 56
SECTION 3.4 Reports and Records for the Trustee............. 60
SECTION 3.5 Annual Servicer's Certificate................... 61
SECTION 3.6 Annual Independent Accountants' Servicing
Report........................................ 61
SECTION 3.7 Tax Treatment................................... 62
SECTION 3.8 Notices to the Seller........................... 63
ARTICLE IV
RIGHTS OF CERTIFICATEHOLDERS AND ALLOCATION
AND APPLICATION OF COLLECTIONS
SECTION 4.1 Establishment of Accounts and Allocations
with Respect to the Exchangeable Seller
Certificate.................................... 64
SECTION 4.2 Collection and Allocations..................... 66
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ARTICLE V
[ARTICLE V IS RESERVED AND SHALL
BE SPECIFIED IN ANY SUPPLEMENT
WITH RESPECT TO ANY SERIES]
ARTICLE VI
THE CERTIFICATES
SECTION 6.1 The Certificates............................. 71
SECTION 6.2 Authentication of Certificates............... 71
SECTION 6.3 Registration of Transfer and Exchange of
Certificates............................... 72
SECTION 6.4 Mutilated, Destroyed, Lost or Stolen
Certificates............................... 77
SECTION 6.5 Persons Deemed Owners........................ 78
SECTION 6.6 Appointment of Paying Agent.................. 79
SECTION 6.7 Access to List of Certificateholders' Names
and Addresses.............................. 80
SECTION 6.8 Authenticating Agent......................... 81
SECTION 6.9 Tender of Exchangeable Seller Certificate.... 82
SECTION 6.10 Global Certificate; Euro-Certificate Exchange
Date....................................... 85
SECTION 6.11 Book-Entry Certificates...................... 85
SECTION 6.12 Notices to Clearing Agency................... 86
SECTION 6.13 Definitive Certificates...................... 86
SECTION 6.14 Meetings of Certificateholders............... 87
ARTICLE VII
OTHER MATTERS RELATING TO THE SELLER
SECTION 7.1 Liability of the Seller...................... 88
SECTION 7.2 Merger or Consolidation of, or Assumption of
the Obligation of, the Seller.............. 88
SECTION 7.3 Limitation on Liability of the Seller........ 89
ARTICLE VIII
OTHER MATTERS RELATING
TO THE SERVICER
SECTION 8.1 Liability of the Servicer.................... 90
SECTION 8.2 Merger or Consolidation of, or Assumption of
the Obligations of, the Servicer........... 90
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SECTION 8.3 Limitation on Liability of the Servicer and
Others.......................................... 91
SECTION 8.4 Servicer Indemnification of the Trust and
the Trustee..................................... 91
SECTION 8.5 Resignation of the Servicer....................... 92
SECTION 8.6 Access to Certain Documentation and
Information Regarding the Receivables........... 93
SECTION 8.7 Delegation of Duties.............................. 93
SECTION 8.8 Examination of Records............................ 94
ARTICLE IX
PAY OUT EVENTS
SECTION 9.1 Pay Out Events.................................... 95
SECTION 9.2 Additional Rights Upon the Occurrence of
Certain Events.................................. 95
ARTICLE X
SERVICER DEFAULTS
SECTION 10.1 Servicer Defaults................................. 98
SECTION 10.2 Trustee to Act; Appointment of Successor.......... 100
SECTION 10.3 Notification to Certificateholders................ 103
SECTION 10.4 Waiver of Past Defaults........................... 103
ARTICLE XI
THE TRUSTEE
SECTION 11.1 Duties of Trustee................................. 104
SECTION 11.2 Certain Matters Affecting the Trustee............. 106
SECTION 11.3 Trustee Not Liable for Recitals in
Certificates.................................... 107
SECTION 11.4 Trustee May Own Certificates...................... 108
SECTION 11.5 The Servicer to Pay Trustee's Fees and
Expenses........................................ 108
SECTION 11.6 Eligibility Requirements for Trustee.............. 108
SECTION 11.7 Resignation or Removal of Trustee................. 109
SECTION 11.8 Successor Trustee................................. 110
SECTION 11.9 Merger or Consolidation of Trustee................ 110
SECTION 11.10 Appointment of Co-Trustee or Separate Trustee..... 110
SECTION 11.11 Tax Returns....................................... 112
SECTION 11.12 Trustee May Enforce Claims Without Possession
of Certificates................................. 112
SECTION 11.13 Suits for Enforcement............................ 112
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SECTION 11.14 Rights of Certificateholders to Direct
Trustee.................................... 113
SECTION 11.15 Representations and Warranties of Trustee.... 113
SECTION 11.16 Maintenance of Office or Agency.............. 113
ARTICLE XII
TERMINATION
SECTION 12.1 Termination of Trust......................... 115
SECTION 12.2 Optional Purchase and Final Termination of
Investor Certificates of any Series........ 116
SECTION 12.3 Final Payment with Respect to any Series..... 116
SECTION 12.4 Seller's Termination Rights.................. 118
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.1 Amendment.................................... 119
SECTION 13.2 Protection of Right, Title and Interest to
Trust...................................... 121
SECTION 13.3 Limitation on Rights of Certificateholders... 122
SECTION 13.4 GOVERNING LAW................................ 123
SECTION 13.5 Notices...................................... 123
SECTION 13.6 Severability of Provisions................... 124
SECTION 13.7 Certificates Non-Assessable and Fully Paid... 124
SECTION 13.8 Further Assurances........................... 124
SECTION 13.9 No Waiver; Cumulative Remedies............... 124
SECTION 13.10 Counterparts................................. 124
SECTION 13.11 Third-Party Beneficiaries.................... 125
SECTION 13.12 Actions by Certificateholders................ 125
SECTION 13.13 Rule 144A Information........................ 125
SECTION 13.14 Merger and Integration....................... 125
SECTION 13.15 Headings..................................... 125
Exhibit A Form of Exchangeable Seller Certificate
Exhibit B Form of Assignment of Receivables in Additional Accounts
Exhibit C Form of Monthly Servicer's Certificate
Exhibit D Form of Annual Servicer's Certificate
Exhibit E Form of Seller Certificate Designating Banks and Agent Banks
the Accounts of which Constitute Automatic Additional Accounts
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Exhibit F Form of Opinion of Counsel Pursuant to Sections
2.6(g)(vi) and 13.2(d)(i)
Exhibit G Form of Annual Security Interest Opinion Pursuant to
Section 13.2(d)(ii)
Exhibit H Form of Depository Agreement
Exhibit I Form of Reassignment of Removed Accounts
Exhibit J Form of Officer's Certificate Pursuant to Section
2.8(d)(ii)
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AMENDED AND RESTATED POOLING AND SERVICING AGREEMENT, dated as of March [
], 1997, by and between PEOPLE'S BANK, a Connecticut capital stock savings bank,
as Seller and Servicer, and BANKERS TRUST COMPANY, a banking corporation
organized and existing under the laws of the State of New York, as Trustee.
WHEREAS, People's Bank, as Seller and Servicer, and the Trustee entered
into that certain Pooling and Servicing Agreement, dated as of June 1, 1993 (as
amended by an amendment dated as of December 15, 1995, the "Original Pooling and
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Servicing Agreement"); and
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WHEREAS, People's Bank, as Seller and Servicer, and the Trustee desire to
amend and restate the Original Pooling and Servicing Agreement in its entirety;
NOW, THEREFORE, in consideration of the mutual agreements herein contained,
the Original Pooling and Servicing Agreement is hereby amended and restated in
its entirety as follows and each party agrees as follows for the benefit of the
other parties and the Certificateholders:
ARTICLE I
DEFINITIONS
SECTION 1.1 Definitions. Whenever used in this Agreement, the following
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words and phrases shall have the following meanings:
"Account" shall mean each VISA(R)/*/ and MasterCard(R)/*/ credit card
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account (or other consumer revolving credit account to the extent provided
herein), which account is governed by a Credit Card Agreement between the Seller
and any Person identified by account number in each computer file or microfiche
list delivered to the Trustee by the Seller pursuant to Section 2.1 or 2.6. The
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definition of Account shall include each account into which an Account shall be
transferred (a "Transferred Account"); provided, that (i) such transfer was made
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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 or
microfiche lists delivered to the Trustee pursuant to Section 2.1, 2.6, 2.7 or
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3.4(c), as an account into which an Account has been transferred. The term
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"Account" shall be deemed
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/*/ VISA(R) and MasterCard(R) are registered trademarks of VISA USA, Inc. and
of MasterCard International Incorporated, respectively.
to refer to an Additional Account or Automatic Additional Account only from and
after the Addition Date or Automatic Addition Date, as the case may be, 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 Guidelines" shall mean the Seller's policies and procedures
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relating to the operation of its credit card business, including, without
limitation, the policies and procedures for determining the creditworthiness of
credit card customers, the extension of credit to credit card customers, and
relating to the maintenance of credit card accounts and collection of credit
card receivables, as such policies and procedures may be amended from time to
time.
"Account Information" shall have the meaning specified in subsection
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2.2(b).
"Accumulation Period" shall have the meaning specified in any applicable
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Supplement.
"Addition Date" shall mean each date as of which Additional Accounts will
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be included as Accounts pursuant to Section 2.6.
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"Addition Notice Date" shall have the meaning specified in subsection
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2.6(g)(i).
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"Additional Accounts" shall mean additional credit card accounts added as
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Accounts pursuant to subsections 2.6(e) and 2.6(f).
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"Affiliate" of any Person shall mean any other Person controlling,
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controlled by or under common control with such Person except that, for the
purposes of clause (f) of the definition of Eligible Account, "Affiliate" shall
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not mean a natural person.
"Affinity Program Account" shall mean an account originated by the Seller
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through the solicitation of prospective cardholders from identifiable groups
with a common interest or a common cause, with the assistance of an organization
or the members of such group.
"Agent Bank Account" shall mean an account originated by the Seller
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pursuant to an agreement between the Seller and a bank for which the Seller
issues VISA(R) and/or MasterCard(R) credit cards and acts as a sponsor with VISA
USA, Inc. and/or MasterCard International Incorporated.
"Aggregate Finance Charge Receivables" shall mean, as of any date of
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determination, the aggregate amount of the Finance Charge
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Receivables as of the end of the Monthly Period immediately preceding such date
of determination.
"Aggregate Investor Interest" shall mean, as of any date of determination,
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the sum of the Investor Interests of each Series of Certificates issued and
outstanding on such date of determination.
"Aggregate Investor Percentage" with respect to Principal Receivables,
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Finance Charge Receivables and Receivables in Defaulted Accounts, as the case
may be, shall mean, as of any date of determination, the sum of such Investor
Percentages of each Series of Certificates issued and outstanding on such date
of determination; provided, however, that the Aggregate Investor Percentage
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shall not exceed 100%.
"Aggregate Principal Receivables" shall mean, as of any date of
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determination, the aggregate amount of Principal Receivables as of the end of
the Monthly Period immediately preceding such date of determination and the
amount on deposit in the Excess Funding Account (exclusive of any investment
earnings on such amount).
"Aggregate Receivables" shall mean, as of any date of determination, the
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sum of Aggregate Principal Receivables plus Aggregate Finance Charge
Receivables.
"Agreement" shall mean this Amended and Restated Pooling and Servicing
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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, the period
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following the related Revolving Period, which shall be the Accumulation Period,
the Controlled Amortization Period, the early Amortization Period, the Rapid
Amortization Period, or other amortization or accumulation period, in each case
as defined, if applicable, with respect to such Series in the related
Supplement.
"Annual Membership Fee" shall have the meaning specified in the Credit Card
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Agreement applicable to an Account.
"Applicants" shall have the meaning specified in Section 6.7.
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"Appointment Day" shall have the meaning specified in Section 9.2.
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"Assignment" shall have the meaning specified in subsection 2.6(g)(ii).
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"Authorized Newspaper" shall mean a newspaper of general circulation in the
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Borough of Manhattan, The City of New York printed in the English language (and,
with respect to any Series, any additional city specified in the Supplement for
such Series) and customarily published on each Business Day, whether or not
published on Saturdays, Sundays and holidays.
"Automatic Addition Date" shall mean the date upon which the Receivables in
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an Automatic Additional Account are first designated for addition, and added to,
the Trust.
"Automatic Additional Accounts" shall mean those consumer revolving credit
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card accounts coming into existence after the Cut Off Date which meet the
following criteria:
(a) VISA Classic or standard MasterCard account which satisfies the
criteria set forth in the definition of "Eligible Account" originated
through applicant-initiated applications or through the Seller's branch
system:
(i) which is originated during the normal operation of such
Seller's credit card business and is not acquired by the Seller from
another credit card issuer;
(ii) which was in existence and owned by the Seller on the date
on which Receivables generated in such account are to be added to the
Trust and is in existence at the close of business on the date of its
designation for inclusion in the Trust;
(iii) which is payable in U.S. Dollars; and
(iv) the Receivables in which have not been charged off prior to
the date of their designation for inclusion in the Trust;
(b) any other consumer revolving credit card account which satisfies
the criteria set forth in the definition of "Eligible Account" without
regard to the requirement that such account be a VISA(R) or MasterCard(R)
credit card account; provided that the Seller shall have received notice
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from each Rating Agency that the inclusion of such accounts as Automatic
Additional Accounts pursuant to this paragraph (b) will not result in the
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reduction or withdrawal of its then existing rating of any Series of
Investor Certificates then issued and outstanding and shall have delivered
such notice to the Trustee; or
(c) each Visa(R) and MasterCard(R) consumer revolving credit card
account, now existing or hereafter arising,
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which (i) is included in a "bank" or "agent bank" of credit card accounts
(or other grouping of credit card accounts, however denominated) maintained
by Total Systems, Inc. (or its successor) or another records processor on
behalf of the Seller, which records processor may be the Seller or an
Affiliate of the Seller, (ii) is not, as of the date of this Agreement, an
existing Account or Additional Account, and (iii) satisfies the following
criteria:
(A) such account is an Eligible Account and an Eligible
Additional Account;
(B) such account is an account that satisfies the criteria
specified in subclauses (i) through (iv) of clause (a) hereof;
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(C) no selection procedures believed by the Seller to be
materially adverse to the interests of the Investor Certificateholders
(without regard to any Enhancement) were utilized in selecting the
pool of accounts in which such account arises from the available pools
of accounts owned by the Seller;
(D) such account is not originated utilizing underwriting
criteria that (i) are materially different from the Seller's standard
underwriting criteria and (ii) would materially increase the
likelihood, as compared to the average expected probability of default
for an Account in the Trust portfolio, that such account would become
a Defaulted Account;
(E) such account is not originated as a "risk based" product; and
(F) the bank or agent bank (or other grouping) in which such
account is included has been designated by the Seller to the Trustee
as a bank or agent bank (or other grouping) the accounts in which
constitute Accounts, Additional Accounts, or Automatic Additional
Accounts, by delivery to the Trustee of a certificate of designation
substantially in the form annexed hereto as Exhibit E hereto or
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otherwise pursuant hereto.
"Banking Commissioner" shall mean the Banking Commissioner of the State of
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Connecticut.
"Base Rate" shall mean, with respect to any Series of Certificates, the
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percentage (or formula on the basis of which such rate shall be determined)
stated in the related Supplement.
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"Bearer Certificates" shall have the meaning specified in Section 6.1.
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"Bearer Rules" shall mean the provisions of the Internal Revenue Code, in
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effect from time to time, governing the treatment of bearer obligations,
including sections 163(f), 871, 881, 1441, 1442 and 4701, and any regulation
thereunder including, to the extent applicable to any Series, Proposed or
Temporary Regulations.
"Billing Cycle" shall mean, with respect to any Account, the monthly
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billing cycle for such Account determined in accordance with the Account
Guidelines.
"Book-Entry Certificates" shall mean certificates evidencing a beneficial
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interest in the Investor Certificates, ownership and transfers of which shall be
made through book entries by a Clearing Agency as described in Section 6.11;
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provided that after the occurrence of a condition whereupon book-entry
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registration and transfer are no longer authorized and Definitive Certificates
are to be issued to the Certificate Owners, such certificates shall no longer be
"Book-Entry Certificates."
"Business Day" shall mean any day other than a Saturday, a Sunday or a day
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on which banking institutions in New York, New York or Bridgeport, Connecticut
(or, with respect to any Series, any additional city specified in the related
supplement) are authorized or obligated by law or executive order to be closed.
"Cash Advance Fees" shall have the meaning specified in the Credit Card
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Agreement applicable to an Account.
"Cash Advances" shall have the meaning specified in the Credit Card
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Agreement applicable to an Account.
"Certificate" shall mean any one of the Investor Certificates of any Series
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or the Exchangeable Seller Certificate.
"Certificateholders' Interest" shall, with respect to any Series, have the
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meaning specified in Article IV of the Supplement for such Series.
"Certificate Interest" shall mean interest payable in respect of the
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Investor Certificates of any Series pursuant to Article IV of the Supplement for
such Series.
"Certificate Owner" shall mean, with respect to a Book-Entry Certificate,
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the Person who is the beneficial owner of such Book-Entry Certificate, as may be
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an
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account with such Clearing Agency (directly or as an indirect participant, in
accordance with the rules of such Clearing Agency).
"Certificate Principal" shall mean principal payable in respect of the
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Investor Certificates of any Series pursuant to Article IV of the Supplement for
such Series.
"Certificate Rate" shall mean, with respect to any Series of Certificates,
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the percentage (or formula on the basis of which such rate shall be determined)
stated in the related Supplement; provided that, unless otherwise provided in a
Supplement, such rate shall be calculated on the basis of a 360-day year
consisting of twelve 30-day months.
"Certificate Register" shall mean the register maintained pursuant to
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Section 6.3, providing for the registration of the Certificates and transfers
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and exchanges thereof.
"Certificateholder" or "Holder" shall mean the Person in whose name a
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Certificate is registered in the Certificate Register and, if applicable, the
bearer of any Bearer Certificate or Coupon, as the case may be, and, as to any
Series, such other Person deemed to be a "Certificateholder," "Holder,"
"Investor Certificateholder" or "Investor Holder" in any related Supplement
except as otherwise provided in such Supplement.
"Class" shall mean, with respect to any Series, any one of the classes of
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Certificates of that Series as specified in the related Supplement.
"Clearing Agency" shall mean an organization registered as a "clearing
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agency" pursuant to Section 17A of the Securities Exchange Act of 1934, as
amended.
"Clearing Agency Participant" shall mean a broker, dealer, bank, other
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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 date of issuance
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of such Series of Certificates, as specified in the related Supplement.
"Collection Account" shall have the meaning specified in Section 4.1(a).
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"Collections" shall mean all payments (including insurance proceeds on
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Accounts that are not Defaulted Accounts and all Recoveries but excluding
drawings on any Enhancement) received by the Servicer in respect of the
Receivables, in the form of cash,
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checks, wire transfers, ATM transfers or other form of payment in accordance
with the Credit Card Agreement in effect from time to time on any Receivables.
A Collection processed on an Account in excess of the aggregate amount of
Receivables in such Account as of the Date of Processing of such Collection
shall be deemed to be a payment in respect of Principal Receivables to the
extent of such excess. Collections with respect to any Monthly Period shall
include the amount of Interchange and Recoveries allocable to the Trust pursuant
to subsections 2.5(k) and (l) with respect to such Monthly Period (to the extent
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deposited into the Collection Account or, with respect to any Series, the
applicable Series Account, on the Transfer Date following such Monthly Period),
to be applied as if such Collections were Collections of Finance Charge
Receivables for all purposes.
"Collection Subaccount" shall have the meaning specified in subsection
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4.1(a).
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"Corporate Trust Office" shall mean the principal office of the Trustee at
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which at any particular time its corporate trust business shall be administered,
which office at the date of the execution of this Agreement is located at Four
Albany Street, 10th Floor, New York, New York 10006, Attention: Corporate Trust
and Agency Group, Structured Finance Team.
"Coupon" shall have the meaning specified in Section 6.1.
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"Credit Adjustment" shall have the meaning specified in subsection
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4.2(d)(i).
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"Credit Card Agreement" shall mean, with respect to any VISA(R) or
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MasterCard(R) credit card account (or other consumer credit accounts, to the
extent provided herein), the agreement between People's Bank and the Obligor
governing the terms and conditions of such account, as such agreement may be
amended, modified or otherwise changed from time to time.
"Cut-Off Date" shall mean, with respect to each Account the Receivables of
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which are conveyed to the Trust pursuant to Section 2.1 on the Initial Closing
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Date, the close of business on May 31, 1993.
"Date of Processing" shall mean, with respect to any transaction, the date
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(but if such date is not a Business Day, then the next Business Day) on which
such transaction is first recorded on the Servicer's computer master file of
VISA(R) and MasterCard(R) accounts or its computer master file of other consumer
revolving accounts, if any, in the Trust (without regard to the effective date
of such recordation.)
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"Default Amount" shall mean, with respect to any Defaulted Account, the
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amount of Principal Receivables in such Defaulted Account on the day such
Account became a Defaulted Account.
"Default Percentage" shall mean on any Date of Processing a percentage, the
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numerator of which shall be the Seller Percentage of the Default Amount on such
day and the denominator of which shall be the Aggregate Principal Receivables at
the end of the preceding Date of Processing minus the Aggregate Principal
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Receivables on the current Date of Processing prior to the deposit of any amount
in the Excess Funding Account.
"Defaulted Account" shall mean each Account with respect to which, in
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accordance with the Account Guidelines or the Servicer's customary and usual
servicing procedures for servicing credit card receivables comparable to the
Receivables (which as of the date hereof is more than 211 days delinquent from
the payment due date) the Servicer has charged off the Receivables in such
Account as uncollectible; an Account shall become a Defaulted Account on the day
on which such Receivables are recorded as charged off and as uncollectible on
the Servicer's computer master file of VISA(R) and MasterCard(R) accounts.
"Definitive Bearer Certificate" shall mean any Definitive Certificate
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issued in bearer form with Coupons attached.
"Definitive Certificate" shall have the meaning specified in Section 6.11.
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"Definitive Euro-Certificate" shall have the meaning specified in Section
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6.10.
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"Definitive Registered Certificate" shall mean any Definitive Certificate
---------------------------------
issued in registered form.
"Depository Agreement" shall mean, with respect to each Series, the
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agreement among the Seller, the Trustee and the Clearing Agency, in the form
attached hereto as Exhibit H, or as otherwise provided in the related
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Supplement.
"Determination Date" shall mean the 8th Business Day of each calendar month
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but not later than the tenth calendar day of such month (and if such day is not
a Business Day, the preceding Business Day).
"Distribution Date" shall mean, unless otherwise specified in any
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Supplement for the related Series, July 15, 1993 and the fifteenth day of each
calendar month thereafter, or, if such fifteenth day is not a Business Day, the
next succeeding Business Day.
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"Dollars," "$" or "U.S. $" shall mean United States dollars.
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"Eligible Account" shall mean a VISA(R) or MasterCard(R) credit card
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account owned by the Seller which, as of the Cut-Off Date:
(a) is payable in United States dollars;
(b) has not been identified on the computer files of the Seller by the
Seller as relating to a cardholder who has died or commenced action
relating to bankruptcy or who is the subject of an involuntary bankruptcy,
insolvency or similar action;
(c) has not been classified on the Seller's computer files by the
Seller as counterfeit, fraudulent, stolen or lost or as a corporate
business card;
(d) has not been charged off by the Seller in its customary and usual
manner for charging off such Accounts as of the Cut-Off Date;
(e) has not been (and no Receivables in such Account have been) sold
or pledged to any other Person;
(f) is not an Account on which the Seller or an Affiliate of the
Seller is the Obligor; and
(g) as of the date of origination of such Account, the obligor of
which had a billing address in the United States, its territories or
possessions.
"Eligible Additional Account" shall mean as of any Addition Date, (a) a
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VISA(R) or MasterCard(R) credit card account owned by the Seller which satisfies
the criteria set forth in clauses (a) through (g) inclusive of the definition of
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Eligible Account, or (b) any other consumer revolving credit account (i) which
satisfy the criteria set forth in clauses (a) through (g) inclusive of the
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definition of Eligible Account, (ii) the addition of the receivables of which
would not cause the Rating Agency to indicate in writing that such addition
would result in the reduction or withdrawal of its then-existing rating of the
Investor Certificates of any Series of Certificates then issued and outstanding
and (iii) to which, to the extent provided in the related Supplement, the
Enhancement Provider with respect to any Series of Certificates consents, which
consent shall not be unreasonably withheld.
"Eligible Receivable" shall mean each Receivable:
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(a) which has arisen under an Eligible Account (in the case of
Accounts conveyed to the Trust on the Initial
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Closing Date) or an Eligible Additional Account (in the case of Additional
Accounts or Automatic Additional Accounts);
(b) which was created in compliance, in all material respects, with
all Requirements of Law applicable to the Seller and pursuant to a Credit
Card Agreement which complies, in all material respects, with all
Requirements of Law applicable to the Seller;
(c) with respect to which all consents, licenses, approvals or
authorizations of, or registrations or declarations with, any Governmental
Authority required to be obtained, effected or given by the Seller in
connection with the creation of such Receivable or the execution, delivery
and performance by the Seller of the Credit Card Agreement pursuant to
which such Receivable was created, have been duly obtained, effected or
given and are in full force and effect as of such date of creation of such
Receivable;
(d) as to which, at the time of and at all times after the creation of
such Receivable, the Seller or the Trust had good and marketable title
thereto free and clear of all Liens (other than Liens permitted pursuant to
subsection 2.5(b));
-----------------
(e) which is the legal, valid and binding payment obligation of the
Obligor thereon, enforceable against such Obligor in accordance with its
terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws,
now or hereafter in effect, affecting the enforcement of creditors' rights
in general and except as such enforceability may be limited by general
principles of equity (whether considered in a suit at law or in equity);
(f) which constitutes an "account" or a "general intangible" under and
as defined in Article 9 of the UCC as then in effect in the State of New
York;
(g) as to which, at the time of its transfer to the Trust, the Seller
has satisfied all material obligations on its part with respect to such
Receivable required to be satisfied;
(h) which is not, at the time of its transfer to the Trust, subject to
any right of rescission, setoff, counter-claim or defense (including the
defense of usury), other than a defense arising out of applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights in general; and
-11-
(i) as to which the Seller has done nothing to impair, or omitted to take
any action the omission of which would impair, the rights of the Trust or
the Certificateholders therein.
"Eligible Servicer" shall mean the Trustee or an entity which, at the time
-----------------
of its appointment as Servicer, (a) is servicing a portfolio of consumer
revolving credit card accounts, (b) is legally qualified and has the capacity to
service the Accounts, (c) is qualified to use the software that People's Bank,
in its capacity as Servicer hereunder, is then currently using to service the
Accounts or obtains the right to use or has its own software which is adequate
to perform its duties under this Agreement and (d) has either a net worth on a
consolidated basis of at least $50,000,000 as of the end of its most recent
fiscal quarter or is an Affiliate of the Seller which has a net worth of at
least $20,000,000.
"Enhancement" shall mean, with respect to any Series, the cash collateral
-----------
account, collateral interest, surety bond, letter of credit, guaranteed rate
agreement, maturity guaranty facility, tax protection agreement, interest rate
swap or cap or any other contract or agreement for the benefit of the
Certificateholders of such Series, as designated in the related supplement.
"Enhancement Provider" shall mean, with respect to any Series, the Person,
--------------------
if any, designated as such in the related Supplement.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974, as
-----
amended from time to time.
"Euro-Certificate Exchange Date" shall mean, with respect to any Series,
------------------------------
the date, if any, specified in the related Supplement.
"Euro-clear Operator" shall have the meaning, if applicable, specified in
-------------------
the related Supplement.
"Excess Funding Account" shall have the meaning specified in subsection
---------------------- ----------
4.1(b).
------
"Exchange" shall mean either of the procedures described under Section 6.9.
-------- -----------
"Exchangeable Seller Certificate" shall mean the certificate which
-------------------------------
represents the Seller Interest executed by the Seller and authenticated by the
Trustee, substantially in the form of Exhibit A and exchangeable as provided in
---------
Section 6.9; provided that at any time there shall be only one Exchangeable
-----------
Seller Certificate.
-12-
"Exchange Date" shall have the meaning, with respect to any Series issued
-------------
pursuant to an Exchange, specified in Section 6.9.
-----------
"Exchange Notice" shall have the meaning, with respect to any Series issued
---------------
pursuant to an Exchange, specified in Section 6.9.
-----------
"Expired Accounts" shall mean, with respect to any Expired Accounts Removal
----------------
Date, the Accounts listed in a computer file, microfiche list or printed copy
delivered by the Seller to the Trustee, pursuant to Section 2.8(b), not later
--------------
than five Business Days after such Expired Accounts Removal Date as Accounts
that (i) have zero Receivables balances as of such Expired Accounts Removal
Date, (ii) have expired as of such Expired Accounts Removal Date according to
the records maintained by the Seller's records processor (which may be the
Seller or an Affiliate of the Seller), and (iii) have been deleted from the
records maintained by the Seller's records processor and therefore cannot be
reactivated.
"Expired Accounts Removal Date" shall mean each date occurring not less
-----------------------------
than five Business Days after the date of this Agreement and designated as a
date on which the Receivables from Expired Accounts shall be deleted and removed
from the Trust and reassigned to the Seller pursuant to Section 2.8.
-----------
"Extended Trust Termination Date" shall have the meaning specified in
-------------------------------
subsection 12.1(a).
------------------
"FDIC" shall mean the Federal Deposit Insurance Corporation.
----
"Finance Charge Receivables" shall mean Receivables created in respect of
--------------------------
the Periodic Finance Charges, Annual Membership Fees, Cash Advance Fees, Late
Fees, Returned Check Fees, Overlimit Fees, other fees and charges that are
treated as Finance Charge Receivables in the most recent monthly Servicer's
certificate forwarded to the Trustee pursuant to Section 3.4(b) hereof,
investment earnings on the Excess Funding Account and Recoveries and Interchange
allocable to the Trust.
"Foreign Clearing Agency" shall have the meaning specified in the
-----------------------
applicable Supplement.
"Fractional Undivided Interest" shall mean the fractional undivided
-----------------------------
interest in the Certificateholders' Interest evidenced by an Investor
Certificate.
"Global Certificate" shall have the meaning specified in subsection
------------------ ----------
6.10(a).
-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.
"Ineligible Receivable" shall have the meaning specified in subsection
--------------------- ----------
2.4(d).
------
"Initial Closing Date" shall mean July 9, 1993.
--------------------
"Initial Investor Interest" shall mean, with respect to any Series of
-------------------------
Certificates, the amount stated in the related Supplement.
"Interchange" shall mean interchange fees or interchange reimbursement
-----------
fees, paid or payable to the Seller, in its capacity as credit card issuer,
through VISA USA, Inc. and MasterCard International Incorporated in connection
with cardholder purchases for merchandise and services, minus, fees paid by the
-----
Seller to third parties in respect of interchange fees.
"Interest Accrual Period" shall mean, unless otherwise specified in any
-----------------------
Supplement for the related Series, each Monthly Period.
"Internal Revenue Code" shall mean the Internal Revenue Code of 1986, as
---------------------
amended from time to time.
"Investment Company Act" shall mean the Investment Company Act of 1940, as
----------------------
amended from time to time.
"Investor Certificate" shall mean any one of the certificates (including,
--------------------
without limitation, the Bearer Certificates, the Registered Certificates or the
Global Certificates) executed by the Seller and authenticated by the Trustee
substantially in the form (or forms in the case of Series with multiple Classes)
of investor certificate attached to the related Supplement and such other
interest in the Trust deemed to be an "Investor Certificate" in any related
Supplement except as otherwise provided in such Supplement.
"Investor Certificateholder" shall mean the holder of record of an Investor
--------------------------
Certificate.
"Investor Default Amount" shall have, with respect to any Series of
-----------------------
Certificates, the meaning stated in the related Supplement.
"Investor Interest" shall have, with respect to any Series of Certificates,
-----------------
the meaning stated in the related Supplement.
-14-
"Investor Percentage" shall have, with respect to Principal Receivables,
-------------------
Finance Charge Receivables and Receivables in Defaulted Accounts, and any Series
of Certificates, the meaning stated in the related Supplement.
"Late Fees" shall have the meaning specified in the Credit Card Agreement
---------
applicable to an 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, without
limitation, any conditional sale or other title retention agreement, any
financing lease having substantially the same economic effect as any of the
foregoing and the filing of any financing statement under the UCC (other than
any such financing statement filed for informational purposes only) or
comparable law of any jurisdiction to evidence any of the foregoing; provided,
--------
however, that any assignment pursuant to Section 7.2 shall not be deemed to
------- -----------
constitute a Lien.
"Minimum Aggregate Principal Receivables" shall mean, as of any date of
---------------------------------------
determination, the largest "Minimum Aggregate Principal Receivables" specified
in the Supplement with respect to any Series of Certificates issued and
outstanding at such date of determination.
"Minimum Seller Interest" shall mean for any 30-day period 7% or such
-----------------------
higher percentage as may be specified in any Supplement of the average Aggregate
Principal Receivables for each day during such 30-day period.
"Monthly Investor Servicing Fee" shall have the meaning specified in
------------------------------
Section 3.2.
-----------
"Monthly Period" shall mean the period beginning on and including the first
--------------
day of a calendar month to and including the last day of a calendar month. The
first Monthly Period shall begin on and include June 1, 1993, and shall end on
and include June 30, 1993.
"Monthly Seller Servicing Fee" shall have the meaning specified in Section
---------------------------- -------
3.2.
---
"Monthly Servicing Fee" shall have the meaning specified in Section 3.2.
--------------------- -----------
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
-------
-15-
"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 a certificate signed by any Vice
---------------------
President of the Seller or Servicer and delivered to the Trustee.
"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 who shall be
reasonably acceptable to the Trustee.
"Overlimit Fees" shall have the meaning specified in the Credit Card
--------------
Agreement applicable to an Account.
"Paying Agent" shall have the meaning specified in Section 6.6 and shall
------------ -----------
initially be the Trustee.
"Pay Out Commencement Date" shall mean, with respect to each Series, (a)
-------------------------
the date on which a Trust Pay Out Event is deemed to occur pursuant to Section
-------
9.1 or (b) a Series Pay Out Event is deemed to occur pursuant to the Supplement
---
for such Series.
"Pay Out Event" shall mean, with respect to each Series, a Trust Pay Out
-------------
Event or a Series Pay Out Event.
"People's Bank" shall mean People's Bank, a Connecticut capital stock
-------------
savings bank.
"Periodic Finance Charges" shall have the meaning specified in the Credit
------------------------
Card Agreement applicable to an Account for finance charges (monthly periodic
rate) or any similar term.
"Permitted Investments" shall mean, unless otherwise provided in the
---------------------
Supplement with respect to any Series (a) negotiable instruments or securities
represented by instruments in book-entry, bearer or registered form which
evidence (i) obligations of or fully guaranteed with respect to timely payment
by the United States of America; (ii) demand deposits, time deposits or
certificates of deposit of, or bankers' acceptances issued by, any depositary
institution or trust company incorporated under the laws of the United States of
America or any state thereof and subject to supervision and examination by
federal or state banking or depositary institution authorities; provided,
--------
however, that at the time of the Trust's investment or contractual commitment to
-------
invest therein, the certificates of deposit or short-term deposits, if any, or
long-term unsecured debt obligations (other than such obligations whose rating
is based on collateral or on the credit of a Person other than such institution
or trust company) of such depositary
-16-
institution or trust company shall have a credit rating from Moody's and
Standard & Poor's of P-1 and A-1+, respectively, in the case of the certificates
of deposit or short-term deposits, or a rating from Moody's of at least Aa3, and
from Standard & Poor's of AAA, in the case of the long-term unsecured debt
obligations, and the amount of such time deposits, demand deposits or
certificate of deposit are fully insured within the limits of insurance set by
the FDIC; (iii) certificates of deposit having, at the time of the Trust's
investment or contractual commitment to invest therein, a rating from Moody's
and Standard & Poor's of P-1 and A-1+, respectively; (iv) commercial paper
having, at the time of the Trust's investment or contractual commitment to
invest therein, a rating from Moody's and Standard & Poor's of P-1 and A-1+,
respectively; and (v) investments in money market funds and certain open end
diversified investment companies rated AAA-m or AAA-mG by Standard & Poor's and
Aaa by Moody's, or otherwise approved in writing by the Rating Agency; (b)
demand deposits in the name of the Trust or the Trustee in any depositary
institution or trust company referred to in clause (a)(ii) above; and (c)
--------------
securities not represented by an instrument, which are registered in the name of
the Trustee, on behalf of the Trust, upon books maintained for that purpose by
or on behalf of the issuer thereof and identified on books maintained for that
purpose by the Trustee and held for the benefit of the Trust or the
Certificateholders, and consisting of shares of an open end diversified
investment company which is registered under the Investment Company Act and
which (i) invests its assets exclusively in obligations of or guaranteed by the
United States of America or any instrumentality or agency thereof having in each
instance a final maturity date of less than one year from their date of purchase
or other Permitted Investments, (ii) seeks to maintain a constant net asset
value per share, (iii) has aggregate net assets of not less than $100,000,000 on
the date of purchase of such shares, (iv) which is acceptable to the Rating
Agency without causing a reduction in its rating of any Series of Certificates
then outstanding (as confirmed in writing by such rating agency) and (v) which,
to the extent provided in any Supplement, is acceptable to the related
Enhancement Provider.
"Person" shall mean any legal person, including any individual,
------
corporation, partnership, joint venture, association, joint-stock company,
trust, unincorporated organization, governmental entity or other entity of
similar nature.
"Pool Amount" shall have, with respect to any Series, the meaning specified
-----------
in the related Supplement.
"Pool Factor" shall mean, unless any Series is issued in more than one
-----------
Class as stated in any related Supplement, with respect to any Series and with
respect to any Record Date, a
-17-
number carried out to seven decimals representing the ratio of the applicable
Investor Interest as of the end of the last day of the preceding Monthly Period
to the Initial Investor Interest.
"Portfolio Yield" shall mean, unless otherwise provided with respect to any
---------------
Series as specified in the related Supplement, with respect to any Monthly
Period, the annualized percentage equivalent of a fraction the numerator of
which is the Finance Charge Receivables billed during such Monthly Period and
allocable to the Aggregate Investor Interest or the Investor Interest with
respect to any Series, as the case may be, during such Monthly Period to be
calculated on a cash basis after subtracting an amount equal to the sum of the
Investor Default Amount with respect to each Series then issued and outstanding
or the Investor Default Amount with respect to the applicable Series, as the
case may be, for such Monthly Period, and the denominator of which is the
Aggregate Investor Interest or the Investor Interest with respect to any Series,
as the case may be, as of the last day of the preceding Monthly Period.
"Principal Receivable" shall mean each Receivable other than (i) Finance
--------------------
Charge Receivables and (ii) Receivables in Defaulted Accounts. A Receivable
shall be deemed to have been created at the end of the day on the Date of
Processing of such receivable. In calculating the aggregate amount of Principal
Receivables on any day, the amount of Principal Receivables shall be reduced by
the aggregate amount of credit balances in the Accounts on such day. Any
Receivables which the Seller is unable to transfer as provided in subsection
----------
2.5(e) shall not be included in calculating the aggregate amount of Principal
------
Receivables.
"Principal Shortfalls" shall mean, with respect to a Distribution Date, the
--------------------
aggregate amount for all outstanding Series which the related Supplements
specify are "Principal Shortfalls" for such Distribution Date.
"Principal Terms" shall have the meaning, with respect to any Series issued
---------------
pursuant to an Exchange, specified in Section 6.9.
-----------
"Qualified Institution" shall have the meaning specified in subsection
--------------------- ----------
4.1(a).
------
"Qualified Trust Institution" shall mean a depository institution having
---------------------------
corporate trust powers under applicable federal and state laws organized under
the laws of the United States of America or any one of the states thereof or the
District of Columbia; provided, however, that the long-term unsecured debt
obligations (other than such obligation whose rating is based on collateral or
on the credit of a Person other than such institution or trust company) of such
depository
-18-
institution or trust company shall have a credit rating from Moody's and
Standard & Poor's of at least Baa3 and BBB-, respectively, and the deposits in
whose accounts are insured to the limits provided by law and as required by the
FDIC.
"Rating Agency" shall mean, with respect to each Series, the rating agency
-------------
or agencies, if any, specified in the related Supplement.
"Reassignment" shall have the meaning set forth in subsection 2.7(b).
------------ -----------------
"Receivable" shall mean any amount owing in respect of the Accounts
----------
including both Principal Receivables and Finance Charge Receivables.
"Record Date" shall mean, with respect to any Distribution Date, (i) so
-----------
long as the Trust has not issued Definitive Certificates, the last Business Day
preceding such Distribution Date and (ii) after the issuance of Definitive
Certificates, the last day of the calendar month preceding such Distribution
Date.
"Recoveries" shall mean all net amounts received by the Servicer with
----------
respect to charged-off credit card receivables in the Seller's portfolio of VISA
and MasterCard accounts.
"Registered Certificates" shall have the meaning specified in Section 6.1.
----------------------- -----------
"Removal Date" shall have the meaning specified in subsection 2.7(a).
------------ -----------------
"Removal Notice Date" shall have the meaning specified in subsection
------------------- ----------
2.7(a).
"Removed Accounts" shall have the meaning specified in subsection 2.7(a).
---------------- -----------------
"Repurchase Terms" shall mean, with respect to any Series, the terms and
----------------
conditions under which the Seller may repurchase such Series of Certificates
pursuant to Section 12.2(a) as provided in the related Supplement.
---------------
"Requirements of Law" for any Person shall mean the certificate of
-------------------
incorporation or articles of association and by-laws 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 (including, without limitation, usury laws, the
federal Truth in Lending Act and
-19-
Regulation Z and Regulation B of the Board of Governors of the Federal Reserve
System).
"Responsible Officer" shall mean any officer within the Corporate Trust
-------------------
Office (or any successor group of the Trustee), including any Vice President,
any Assistant Vice President, any Assistant Secretary, any Assistant Treasurer,
or any other officer of the Trustee customarily performing functions similar to
those performed by any of the above-designated officers and also, with respect
to a particular matter, any other officer to whom such matter is referred
because of such officer's knowledge of and familiarity with the particular
subject.
"Returned Check Fees" shall have the meaning specified in the Credit Card
-------------------
Agreement applicable to an Account.
"Revolving Period" shall have, with respect to each Series, the meaning
----------------
specified in the related Supplement.
"Securities Act" shall mean the Securities Act of 1933, as amended.
--------------
"Securities Exchange Act" shall mean the Securities Exchange Act of 1934,
-----------------------
as amended.
"Seller" shall mean People's Bank, and any entity which purchases or
------
otherwise acquires the Accounts or any of them in accordance with the provisions
of Sections 7.2 and 13.1(a)(ii).
------------ -----------
"Seller Exchange" shall have the meaning specified in Section 6.9.
--------------- -----------
"Seller Interest" shall mean, on any date of determination, the Aggregate
---------------
Principal Receivables at the end of the day immediately prior to such date of
determination, minus the Aggregate Investor Interest at the end of such day.
-----
"Seller Percentage" shall mean, on any date of determination, when used
-----------------
with respect to Principal Receivables, Finance Charge Receivables and
Receivables in Defaulted Accounts, a percentage equal to 100% minus the
-----
Aggregate Investor Percentage with respect to such categories of Receivables.
"Series" shall mean any series of Investor Certificates.
------
"Series Account" shall mean any account established pursuant to a
--------------
Supplement for the benefit of such Series.
"Series Pay Out Event" shall have, with respect to any Series, the meaning
--------------------
specified pursuant to the Supplement for the related Series.
-20-
"Series Servicing Fee Percentage" shall mean, with respect to any Series,
-------------------------------
the amount specified in the related Supplement.
"Series Termination Date" shall mean, with respect to any Series of
-----------------------
Certificates, the date stated in the related Supplement.
"Servicer" shall mean initially People's Bank, and its permitted successors
--------
and assigns and thereafter any Person appointed as successor as herein provided
to service the Receivables.
"Servicer Default" shall have the meaning specified in Section 10.1.
---------------- ------------
"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 Finance Charge Collections" shall mean, with respect to any
---------------------------------
Business Day, the aggregate amount of Finance Charge Collections allocable to
each Series in excess of the amounts necessary to make required payments
specified in the applicable Supplement with respect to each such Series, if any,
and available to cover shortfalls with respect to other Series.
"Shared Principal Collections" shall mean, with respect to a Distribution
----------------------------
Date, the aggregate amount of Collections of Principal Receivables for all
outstanding Series which the related Supplements specify are to be treated as
"Shared Principal Collections" for such Distribution Date.
"Standard & Poor's" shall mean Standard & Poor's Ratings Services, a
-----------------
division of The McGraw Hill Companies, Inc.
"Subject Certificate" shall have the meaning specified in subsection
------------------- ----------
6.3(e).
"Successor Servicer" shall have the meaning specified in Section 10.2.
------------------ ------------
"Supplement" shall mean, with respect to any Series, a supplement to this
----------
Agreement complying with the terms of Section 6.9 of this Agreement, executed in
-----------
conjunction with any issuance of such Series of Certificates.
"Termination Notice" shall have the meaning specified in Section 10.1.
------------------ ------------
-21-
"Transfer Agent and Registrar" shall have the meaning specified in Section
---------------------------- -------
6.3 and shall initially be the Trustee.
---
"Transfer Date" shall mean, with respect to any Series, the Business Day
-------------
immediately prior to each Distribution Date.
"Transferred Account" shall have the meaning specified in the definition of
-------------------
"Account".
"Trust" shall mean the People's Bank Credit Card Master Trust created by
-----
this Agreement.
"Trust Assets" shall have the meaning specified in Section 2.1.
------------ -----------
"Trust Extension" shall have the meaning specified in subsection 12.1(a).
--------------- ------------------
"Trust Pay Out Event" shall have, with respect to each Series, the meaning
-------------------
specified in Section 9.1.
-----------
"Trust Termination Date" shall mean the earlier to occur of (i) unless a
----------------------
Trust Extension shall have occurred, the day after the Distribution Date with
respect to any Series following the date on which funds shall have been
deposited in the Collection Account or the applicable Series Account for the
payment of (a) Investor Certificateholders of each Series then issued and
outstanding in an amount sufficient to pay the Aggregate Investor Interest plus
interest accrued at the applicable Certificate Rate through the end of the
related Interest Accrual Period prior to the Distribution Date with respect to
each such Series in full and (b) each Enhancement Provider with respect to all
amounts owed to such Enhancement Provider as provided herein or in any
Supplement, (ii) if a Trust Extension shall have occurred, the Extended Trust
Termination Date, and (iii) the expiration of 21 years from the death of the
last survivor of the descendants of Xxxxxx X. Xxxxxxx, the father of the late
President of the United States, living on the date of this Agreement.
"Trustee" shall mean the institution executing this Agreement as Trustee,
-------
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 any specified jurisdiction.
"Undivided Interest" shall mean the undivided interest in the Trust of any
------------------
Certificateholder.
-22-
SECTION 1.2 Other Definitional Provisions.
-----------------------------
(a) All terms defined in any Supplement or this Agreement shall have the
defined meanings when used in any certificate or other document made or
delivered pursuant hereto unless otherwise defined therein.
(b) As used herein and in any certificate or other document made or
delivered pursuant hereto or thereto, accounting terms not defined in Section
-------
1.1, and accounting terms partially defined in Section 1.1 to the extent not
--- -----------
defined, shall have the respective meanings given to them under generally
accepted accounting principles or regulatory accounting practices, as
applicable. To the extent that the definitions of accounting terms herein are
inconsistent with the meanings of such terms under generally accepted accounting
principles or regulatory accounting practices, the definitions contained herein
shall control.
(c) The agreements, representations and warranties of People's Bank in
this Agreement and in any Supplement in each of its capacities as Seller and
Servicer shall be deemed to be the agreements, representations and warranties of
People's Bank solely in each such capacity for so long as People's Bank acts in
each such capacity under this Agreement.
(d) The words "hereof," "herein" and "hereunder" and words of similar
import when used in this Agreement shall refer to any Supplement or this
Agreement as a whole and not to any particular provision of this Agreement or
any Supplement; and Section, subsection, Schedule and Exhibit references
contained in this Agreement or any Supplement are references to Sections,
subsections, Schedules and Exhibits in or to this Agreement or any Supplement
unless otherwise specified. The monthly Servicer certificate shall be in
substantially the form of Exhibit C hereto, with such changes as the Servicer
---------
may determine to be necessary or desirable; provided, however, that no such
-------- -------
change shall serve to exclude information required by the Agreement or any
Supplement. The Servicer shall, upon making such determination, deliver to the
Trustee and the Rating Agency an Officer's Certificate to which shall be annexed
the form of the related Exhibit, as so changed. Upon the delivery of such
Officer's Certificate to the Trustee, the related Exhibit, as so changed, shall
for all purposes of this Agreement constitute such Exhibit. The Trustee may
conclusively rely upon such Officer's Certificate as to such changes conforming
to the requirements of this Agreement.
[End of Article I]
-23-
ARTICLE II
CONVEYANCE OF RECEIVABLES;
ISSUANCE OF CERTIFICATES
SECTION 2.1 Conveyance of Receivables. By execution of this Agreement,
-------------------------
the Seller does hereby transfer, assign, set-over, and otherwise convey
(collectively the "Conveyance") to the Trust for the benefit of the
----------
Certificateholders as of the close of business on the Cut-Off Date, without
recourse, all of its right, title and interest in and to (i) the Receivables now
existing and hereafter created and arising in connection with the Accounts and
in connection with any accounts that meet the definition of Automatic Additional
Accounts (other than Receivables in Additional Accounts), (ii) all monies and
investments due or to become due with respect thereto (including all Finance
Charge Receivables), (iii) all proceeds of such Receivables, (iv) Recoveries
allocated to the Trust pursuant to subsection 2.5(l), (v) all funds deposited
-----------------
from time to time in any Series Account now existing and hereafter established,
including any reserve account, principal funding account, cash collateral
account or spread account, and (vi) Interchange allocable to the Trust pursuant
to subsection 2.5(k) and all proceeds thereof, which shall initially constitute
-----------------
the assets of the Trust. Such property, together with all monies and
investments on deposit, from time to time, in the Collection Account, the Excess
Funding Account, the Series Accounts maintained for the benefit of the
Certificateholders of any Series of Certificates, any Enhancement and all monies
available under any Enhancement, to be provided for any Series for payment to
the Certificateholders of such Series, shall constitute the assets of the Trust
(collectively, the "Trust Assets").
------------
In connection with such transfer, assignment, set-over and conveyance, the
Seller agrees to record and file, at its own expense, a financing statement
(including any continuation statements with respect to such financing statements
when applicable) with respect to the Receivables now existing and hereafter
created for the transfer of accounts (as defined in Section 9-106 of the UCC as
in effect in the State of New York or Connecticut, whichever is applicable)
meeting the requirements of applicable state law in such manner and in such
jurisdictions as are necessary to perfect the assignment of the Receivables to
the Trust, and to deliver a file-stamped copy of such financing statement or
continuation statement or other evidence of such filing (which may, for purposes
of this Section 2.1, consist of telephone confirmation of such filing with the
-----------
file-stamped copy to be provided to the Trustee as soon as practicable after
receipt thereof by the Seller) to the Trustee on or prior to the date of
issuance of the Certificates and in the case of any continuation statements
filed pursuant to this Section 2.1, as
-----------
-24-
soon as practicable after receipt thereof by the Seller. The foregoing transfer,
assignment, set-over and conveyance to the Trust shall be made to the Trustee,
on behalf of the Trust, and each reference in this Agreement to such transfer,
assignment, set-over and conveyance shall be construed accordingly. The Trustee,
except when acting as Servicer, shall be under no obligation whatsoever to file
the financing statements or continuation statements referred to herein, or to
make any other filing under the UCC in connection with the foregoing transfer,
assignment, set-over and conveyance.
In connection with such transfer, the Seller agrees, at its own expense, on or
prior to the Initial Closing Date (i) to clearly xxxx its computer files to
indicate that Receivables created in connection with the Accounts (other than
any Additional Accounts) have been transferred to the Trust pursuant to this
Agreement for the benefit of the Certificateholders and (ii) to deliver to the
Trustee a computer file or microfiche list containing a true and complete list
of all such Accounts, identified by account number and setting forth the
Principal Receivable and Receivable balance as of the related Cut Off Date. Such
file or list shall be marked as Schedule 1 to this Agreement, delivered to the
Trustee as confidential and proprietary, and is hereby incorporated into and
made a part of this Agreement. The Seller further agrees not to alter the code
referenced in clause (i) of this paragraph with respect to any Account during
----------
the term of this Agreement unless and until such Account becomes a Removed
Account.
The Seller intends that the transfer and assignment of Receivables hereunder
constitutes either a sale of such Receivables from the Seller to the Trust or
the grant of a security interest in the Trust Assets to the Trust. The Seller,
therefore, transfers and grants to the Trustee, on behalf of the Trust, a first
priority security interest in all of the Seller's right, title and interest in,
to and under the Trust Assets for the purpose of securing a loan in an amount
equal to the unpaid principal amount of the Investor Certificates issued
hereunder and pursuant to a Supplement and the interest accrued at the related
certificate rate and to secure all of the Seller's and the Servicer's
obligations hereunder, including without limitation, the Seller's obligation to
sell or transfer Receivables hereafter created to the Trust. This Agreement
shall constitute a security agreement (as defined in the UCC as in effect in the
State of New York).
Pursuant to the request of the Seller, the Trustee has caused Certificates in
authorized denominations evidencing the entire interest in the Trust to be duly
authenticated and delivered to or upon the order of the Seller pursuant to
Section 6.2.
-----------
-25-
SECTION 2.2 Acceptance by Trustee.
---------------------
(a) The Trustee hereby acknowledges its acceptance, on behalf of the
Trust, of all right, title and interest previously held by the Seller in and to
(i) the Receivables now existing and hereafter created and arising in connection
with the Accounts and in connection with any accounts that meet the definition
of Automatic Additional Accounts (other than Receivables in Additional
Accounts), (ii) all monies due or to become due with respect thereto (including
all Finance Charge Receivables), (iii) all proceeds of such Receivables, (iv)
Recoveries allocable to the Trust pursuant to subsection 2.5(l) and (v)
-----------------
Interchange allocable to the Trust pursuant to subsection 2.5(k) and the
-----------------
proceeds thereof, 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 or microfiche list described in the
third paragraph of Section 2.1.
-----------
(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 notices delivered to the Trustee by the Seller pursuant to Sections
--------
2.1, 2.6, 2.7 and 3.4(c) (the "Account Information") except as is required in
--- --- ------ -------------------
connection with the performance of its duties hereunder or in enforcing the
rights of the Certificateholders or to a Successor Servicer appointed pursuant
to Section 10.2 and except as otherwise provided in this subsection 2.2(b). The
------------ -----------------
Trustee 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, in connection therewith, shall allow the Seller to inspect the
Trustee's security and confidentiality arrangements from time to time during
normal business hours. In the event that the Trustee is required by law to
disclose any Account Information, the Trustee shall provide the Seller with
prompt written notice, unless such notice is prohibited by law, of any such
request or requirement so that the Seller may request a protective order or
other appropriate remedy. In the event that such protective order or other
remedy is not obtained the Trustee may disclose such information and will
exercise its reasonable best efforts to obtain assurance that confidential
treatment will be afforded such information. The Trustee shall use its
reasonable best efforts to provide the Seller with written notice five days
prior to any disclosure permitted by this subsection 2.2(b).
-----------------
(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.
-26-
SECTION 2.3 Representations and Warranties of the Seller. The Seller
--------------------------------------------
hereby represents and warrants to the Trust and the Trustee as of the Initial
Closing Date:
(a) Organization and Good Standing. The Seller is a Connecticut
------------------------------
capital stock savings bank duly organized and validly existing in good
standing under the laws of the State of Connecticut and has full 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, and to execute, deliver and perform its obligations under this
Agreement 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 (or is exempt from such requirement) in any state
required in order to conduct business, and has obtained all necessary
licenses and approvals with respect to the Seller required under federal
and state law; provided, however, that no representation or warranty is
-------- -------
made with respect to any qualifications, licenses or approvals which the
Trustee would have to obtain to do business in any state in which the
Trustee seeks to enforce any Receivable.
(c) Due Authorization. The execution and delivery of this Agreement
-----------------
and the execution and delivery to the Trustee of the Certificates by the
Seller and the consummation of the transactions provided for in this
Agreement have been duly authorized by the Seller by all necessary
corporate action on its part, including due authorization and approval
thereof by the board of directors of the Seller, and this Agreement will
remain, from the time of its execution, an official record of the Seller.
(d) No Conflict. The execution and delivery of this Agreement and
-----------
the Certificates, the performance of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof will not conflict with,
result in any breach of any of the material terms and provisions of, or
constitute (with or without notice or lapse of time or both) a material
default under, any indenture, contract, agreement, mortgage, deed of trust,
or other instrument to which the Seller is a party or by which it or any of
its properties are bound.
(e) No Violation. The execution and delivery of this Agreement and
------------
the Certificates, the performance of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof will not conflict with or
violate any Requirements of Law applicable to the Seller.
-27-
(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 or the Certificates, (ii) seeking to prevent the issuance of the
Certificates or the consummation of any of the transactions contemplated by
this Agreement 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, (iv) seeking any determination or ruling that would
materially and adversely affect the validity or enforceability of this
Agreement or the Certificates or (v) seeking to affect adversely the income
tax attributes of the Trust.
(g) Eligibility of Accounts. As of the Cut-Off Date, each Account
-----------------------
was an Eligible Account.
(h) Seller's Deposit Accounts. As of the Initial Closing Date,
-------------------------
deposits in the Seller's deposit accounts were insured to the limits
provided by law and as required by the FDIC.
(i) All Consents Required. All appraisals, authorizations, consents,
---------------------
orders or other actions of any Person or of any governmental body or
official required in connection with the execution and delivery of this
Agreement and the Certificates, the performance of the transactions
contemplated by this Agreement and the fulfillment of the terms hereof,
have been obtained.
(j) Account Selection. As of the Cut-Off Date, the Accounts
-----------------
represented Eligible Accounts owned by the Seller that are VISA Classic or
standard MasterCard Accounts. No such selection that will have an adverse
effect on the Certificateholders was used.
(k) Solvency. The Seller is not insolvent as of the Initial Closing
--------
Date and will not be insolvent following the consummation on the Closing
Date of the transactions contemplated by this Agreement, including the
transfer by the Seller to the Trust of the property specified in Section
-------
2.1.
---
For the purposes of the representations and warranties contained in this
Section 2.3 and made by the Seller on the Initial Closing Date, "Certificates"
-----------
shall mean the Certificates issued on the Initial Closing Date. The
representations and warranties set forth in this Section 2.3 shall survive the
-----------
-28-
transfer and assignment of the Trust Assets to the Trust, and termination of the
rights and obligations of the Servicer pursuant to Section 10.1. The Seller
------------
hereby represents and warrants to the Trust and the Trustee, with respect to any
Series of Certificates, as of its Closing Date, unless otherwise stated in such
Supplement, that the representations and warranties of the Seller set forth in
Section 2.3 other than as set forth in subsections 2.3(g), 2.3(h) and 2.3(j) are
----------- ------------------ ------ ------
true and correct as of such date (for the purposes of such representations and
warranties, "Certificates" shall mean the Certificates issued on the related
Closing Date). Upon discovery by the Seller, the Servicer or the Trustee of a
breach of any of the foregoing representations and warranties, the party
discovering such breach shall give prompt written notice to the others,
including the related Enhancement Provider. The Trustee's obligations with
respect to such breach are limited as provided in subsection 11.2(g).
------------------
SECTION 2.4 Representations and Warranties of the Seller Relating to the
------------------------------------------------------------
Agreement and the Receivables.
-----------------------------
(a) Binding Obligation; Valid Transfer and Assignment. The Seller hereby
-------------------------------------------------
represents and warrants to the Trust and the Trustee that, as of the Initial
Closing Date:
(i) This Agreement constitutes a legal, valid and binding obligation
of the Seller, enforceable against the Seller in accordance with its terms,
except (A) 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 the rights of creditors of Connecticut capital stock savings
banks, (B) as such enforceability may be limited by general principles of
equity (whether considered in a suit at law or in equity), (C) subject to
the unenforceability of provisions indemnifying a party against liability
where such indemnification is contrary to public policy, (D) the effect of
judicial decisions which have held that, subject to certain covenants and
provisions of agreements, such agreements are unenforceable where (y) the
breach of such covenants or provisions imposes restrictions or burdens
where it cannot be demonstrated that such breach is a material breach of a
material covenant or provisions, or (z) the creditor's enforcement of such
covenants or provisions under the circumstances would violate the
creditor's implied covenant of good faith and fair dealing, and (E) subject
to the unenforceability of provisions herein to the effect that the failure
to exercise or delay in exercising rights or remedies will not operate as a
waiver of any such rights or remedies, or to the effect that
-29-
provisions therein may only be waived in writing to the extent that an oral
agreement modifying such provisions has been entered into.
(ii) This Agreement constitutes either (A) a valid transfer,
assignment, set-over and conveyance to the Trust of all right, title and
interest of the Seller in and to (i) the Receivables now existing and
hereafter created and arising in connection with the Accounts (other than
Receivables in Additional Accounts), (ii) all monies due or to become due
with respect thereto (including all Finance Charge Receivables), (iii) all
proceeds of such Receivables, (iv) Recoveries allocable to the Trust
pursuant to subsection 2.5(l), (v) all funds deposited from time to time in
-----------------
any Series Account, including any reserve account, cash collateral account
or spread account, and (vi) Interchange allocable to the Trust pursuant to
subsection 2.5(k) and all proceeds thereof, which will be held by the Trust
-----------------
free and clear of any Lien of any Person except for (w) the interests of
the Trustee and the Certificateholders, (x) Liens permitted under
subsection 2.5(b) and subject to Section 9-306 of the UCC as in effect in
-----------------
the State of Connecticut or New York, whichever is applicable, (y) the
interest of the Seller as Holder of the Exchangeable Seller Certificate and
(z) the Seller's right, if any, to interest accruing on, and investment
earnings, if any, in respect of the Collection Account, or any Series
Account, as provided in this Agreement or the related Supplement, or (B) a
grant of a security interest (as defined in the UCC as in effect in the
State of New York) in such property to the Trust, which is enforceable with
respect to the (i) Receivables now existing and hereafter created and
arising in connection with the Accounts and in connection with any accounts
that meet the definition of Automatic Additional Accounts (other than
Receivables in Additional Accounts), (ii) all monies due or to become due
with respect thereto (including all Finance Charge Receivables), (iii) all
proceeds of such Receivables, (iv) Recoveries allocable to the Trust
pursuant to subsection 2.5(l), (v) all funds deposited from time to time in
-----------------
any Series Account, including any reserve account, cash collateral account
or spread account and (vi) Interchange allocable to the Trust pursuant to
subsection 2.5(k) and the proceeds thereof upon execution and delivery of
-----------------
this Agreement, and which will be enforceable with respect to such
Receivables hereafter created, the proceeds thereof, Recoveries, funds
deposited in a Series Account and Interchange allocable to the Trust
pursuant to subsections 2.5(k) and (l), upon such creation. If this
------------------ ---
Agreement constitutes the grant of a security interest to the Trust in such
property, upon the filing of the financing statement described in Section
-------
2.1 and in the case of the Receivables
---
-30-
hereafter created and proceeds thereof, Recoveries and Interchange
allocable to the Trust pursuant to subsections 2.5(k) and (l), upon such
------------------ ---
creation, the Trustee, on behalf of the Trust, shall have a first priority
perfected security interest in such property, except for Liens permitted
under subsection 2.5(b) and subject to Section 9-306 of the UCC as in
-----------------
effect in the State of Connecticut or New York, whichever is applicable.
Neither the Seller nor any Person (other than the Trustee and the
Certificateholders) claiming through or under the Seller shall have any
claim to or interest in the Collection Account, the Excess Funding Account
or any Series Account, and, if this Agreement constitutes the grant of a
security interest in such property, the Seller will have an interest in
such property as a debtor for purposes of the UCC as in effect in State of
New York.
(b) Eligibility of Receivables. The Seller hereby represents and warrants
--------------------------
to the Trust and the Trustee as of the Initial Closing Date and as of each
Addition Date and Automatic Addition Date that:
(i) Each Receivable is an Eligible Receivable as of the Cut-Off Date,
the Automatic Addition Date or the end of the related Monthly Period
immediately preceding the Addition Date, as applicable.
(ii) Each Receivable then existing has been conveyed to the Trust
free and clear of any Lien of any Person other than the Trustee and the
Certificateholders (other than Liens permitted under subsection 2.5(b)) and
-----------------
in compliance, in all material respects, with all Requirements of Law
applicable to the Seller.
(iii) With respect to each Receivable then existing, all consents,
licenses, approvals or authorizations of or registrations or declarations
with any Governmental Authority required to be obtained, effected or given
by the Seller in connection with the conveyance of such Receivable to the
Trust have been duly obtained, effected or given and are in full force and
effect.
(iv) On each day on which any new Receivable is created, the Seller
shall be deemed to represent and warrant to the Trust and the Trustee that
(A) each Receivable created on such day is an Eligible Receivable, (B) each
Receivable created on such day has been conveyed to the Trust in
compliance, in all material respects, with all Requirements of Law
applicable to the Seller, (C) with respect to each such Receivable, all
consents, licenses, approvals or authorizations of or registrations or
-31-
declarations with, any Governmental Authority required to be obtained,
effected or given by the Seller in connection with the conveyance of such
Receivable to the Trust have been duly obtained, effected or given and are
in full force and effect and (D) the representations and warranties set
forth in subsection 2.4(a) are true and correct with respect to each
-----------------
Receivable created on such day as if made on such day.
(v) As of the Initial Closing Date, Schedule 1 to this Agreement and,
----------
as of the last day of each Monthly Period during which Automatic Additional
Accounts were added to the Trust or as of the applicable Addition Date with
respect to Additional Accounts, as the case may be, added pursuant to
Section 2.6, the related computer file or microfiche list referred to in
-----------
Section 2.6, is an accurate and complete listing in all material respects
-----------
of all the Accounts as of the Cut-Off Date, the end of the applicable
Monthly Period or the end of the Monthly Period immediately preceding the
applicable Addition Date and the information contained therein with respect
to the identity of such Accounts and the Receivables existing thereunder is
true and correct in all material respects as of the Cut-Off Date, the end
of the applicable Monthly Period or such applicable Addition Date; as of
the Cut-Off Date, the aggregate amount of Receivables in all the Accounts
was $604,049,628.21.
(c) Notice of Breach. The representations and warranties set forth in
----------------
this Section 2.4 shall survive the transfer and assignment 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 set forth in
this Section 2.4, the party discovering such breach shall give prompt written
-----------
notice to the others. The Seller agrees to cooperate with the Servicer and the
Trustee in attempting to cure any such breach. The Seller hereby acknowledges
that the Trustee intends to rely on the representations hereunder in connection
with representations made by the Trustee to secured parties, assignees or
subsequent transferees. The Trustee's obligations with respect to the breach of
any of the representations and warranties contained in this Section 2.4 are
-----------
limited as provided in subsection 11.2(g).
------------------
(d) Transfer of Ineligible Receivables.
----------------------------------
(i) Automatic Removal. In the event of a breach with respect to a
-----------------
Receivable of any representations and warranties set forth in subsection
----------
2.4(b)(ii), or in the event that a Receivable is not an Eligible Receivable
----------
as a result of the failure to satisfy the conditions set forth in clause
------
(b) or (d) of the definition of Eligible Receivable; then, upon the earlier
--- ---
to occur of the discovery of such
-32-
breach or event by the Seller or the Servicer or receipt by the Seller of
written notice of such breach or event given by the Trustee, each such
Receivable shall be automatically removed from the Trust on the terms and
conditions set forth in subsection 2.4(d)(iii).
----------------------
(ii) Removal After Cure Period. In the event of a breach of any of
-------------------------
the representations and warranties set forth in subsection 2.4(b) other
-----------------
than a breach or event as set forth in clause (d)(i) above, and as a result
-------------
of such breach the related Account becomes a Defaulted Account or the
Trust's rights in, to or under the Receivable or its proceeds are impaired
or the ability of the Servicer to collect such Ineligible Receivable is
impaired or the proceeds of such Receivable are not available for any
reason to the Trust free and clear of any Lien, then, upon the expiration
of 60 days (or such longer period as may be agreed to by the Trustee but in
no event longer than 120 days), from the earlier to occur of the discovery
of any such event by either of the Seller or the Servicer, or receipt by
the Seller of written notice of any such event given by the Trustee or the
related Enhancement Provider, or, with respect to breaches relating to
prior Liens, immediately upon the earlier to occur of such discovery or
notice, each such Receivable shall be removed from the Trust on the terms
and conditions set forth in subsection 2.4(d)(iii); provided, however, that
---------------------- -------- -------
no such removal shall be required to be made if, on any day within such
applicable period, such representations and warranties with respect to such
Receivable shall then be true and correct in all material respects as if
such Receivable had been created on such day and provided, further, that if
-------- -------
a defect in any list of Accounts referred to subsection 2.4(b)(v) results
--------------------
in the balance of Receivables in the Accounts being less than the amount
specified in such subsection, the deficiency shall be deemed to be an
Ineligible Receivable for purposes of this subsection 2.4(d).
-----------------
(iii) Procedures for Removal. When the provisions of subsection
---------------------- ----------
2.4(d)(i) or subsection 2.4(d)(ii) above require removal of a Receivable,
--------- ---------------------
the Seller shall accept reassignment of the portion of such Receivable that
is a Principal Receivable (an "Ineligible Receivable") by (i) directing the
---------------------
Servicer to deduct the portion of such Receivable that is a Principal
Receivable from the aggregate amount of Principal Receivables in the Trust
and to decrease the Seller Interest by such amount and (ii) depositing into
the Collection Account an amount equal to the Finance Charge Receivables
collected in respect of such Receivable through the date of such removal;
provided, however, that if the exclusion of an Ineligible Receivable from
-------- -------
the calculation
-33-
of the Seller Interest would cause the Seller Interest to be less than the
Minimum Seller Interest or would otherwise not be permitted by law, such
Ineligible Receivable shall not be automatically removed from the Trust,
but shall be removed from the Trust only upon the making of the deposit to
the Excess Funding Account referred to in the second following sentence.
On and after the date of such removal, each Ineligible Receivable shall be
deducted from the aggregate amount of Principal Receivables used in the
calculation of any Investor Percentage, the Seller Percentage or the Seller
Interest; provided, however, that for the purposes of subsection 2.6(a) and
-------- ------- -----------------
the calculation of the Seller Interest, each Ineligible Receivable shall,
notwithstanding the proviso to the immediately preceding sentence, be
deemed to have been automatically removed from the Trust. In the event
that the exclusion of an Ineligible Receivable from the calculation of the
Seller Interest would cause the Seller Interest to be reduced below the
Minimum Seller Interest, or would otherwise not be permitted by law, the
Seller shall immediately, but in no event later than 10 days after such
event, make a deposit in the Excess Funding Account (for allocation as a
Principal Receivable pursuant to Article IV) in immediately available funds
----------
in an amount equal to the amount by which the Seller Interest (as
determined above) would be reduced below the Minimum Seller Interest. The
portion of such deposit allocated to Investor Certificates of each Series
shall be distributed to the Investor Certificateholders of each such Series
in the manner specified in Article IV, if applicable, on the related
----------
Distribution Date in the Monthly Period following the Monthly Period in
which such deposit is made. Upon the reassignment to the Seller of an
Ineligible Receivable, the Trust shall automatically and without further
action be deemed to transfer, assign, set-over and otherwise convey to the
Seller, without recourse, representation or warranty, all the right, title
and interest of the Trust in and to such Ineligible Receivable, all monies
due or to become due with respect thereto and all proceeds thereof,
Recoveries and Interchange allocated to such Ineligible Receivable pursuant
to subsections 2.5(k) and (l). The Trustee shall execute such documents
------------------ ---
and instruments of transfer or assignment, on behalf of the Trust, and take
other actions as shall reasonably be requested by the Seller to evidence
the conveyance of such Ineligible Receivable pursuant to this subsection
----------
2.4(d)(iii). In the event that on any day within 60 days of the date on
-----------
which the removal of an Ineligible Receivable from the Trust pursuant to
this Section 2.4 is effected, the applicable representations and warranties
-----------
shall be true and correct in all material respects on such date, the Seller
may, but shall not be required to, direct the Servicer to include such
Receivable
-34-
in the Trust by adding the portion of such Receivable which is a Principal
Receivable to the Principal Receivables in the Trust. Upon the addition of
a Receivable to the Trust pursuant to this subsection 2.4(d)(iii), the
----------------------
Seller shall be deemed to have made the applicable representations and
warranties in subsection 2.4(b) as of the date of such addition, as if the
-----------------
Receivable had been created on such date, and shall execute all such
necessary documents and instruments of transfer or assignment and take such
other actions as shall be necessary to effect and perfect the reconveyance
of such Receivable to the Trust. The obligation of the Seller set forth in
this subsection 2.4(d)(iii), or the automatic removal of such Receivable
----------------------
from the Trust, as the case may be, shall constitute the sole remedy
respecting any breach of the representations and warranties set forth in
the above-referenced subsections with respect to such Receivable available
to Certificateholders or the Trustee on behalf of Certificateholders.
(iv) For the purposes of subsections 2.4(d)(i) and 2.4(d)(ii) above,
--------------------- ----------
proceeds of a Receivable shall not be deemed to be impaired hereunder
solely because such proceeds are held by the Servicer (if the Servicer is
the Seller) for more than the applicable period under Section 9-306(3) of
the UCC as in effect in the State of Connecticut or New York, whichever is
applicable.
(e) Reassignment of Trust Portfolio. In the event of a breach of any of
-------------------------------
the representations and warranties set forth in subsection 2.4(a), either the
-----------------
Trustee, or the Holders of Investor Certificates evidencing Undivided Interests
aggregating more than 50% of the Aggregate Investor Interest, by notice then
given in writing to the Seller (and to the Trustee and the Servicer, if given by
the Investor Certificateholders), may direct the Seller to accept reassignment
of an amount of Principal Receivables (as specified below) within 60 days of
such notice (or within such longer period as may be specified in such notice but
in no event later than 120 days), and the Seller shall be obligated to accept
reassignment of such Principal Receivables on a Distribution Date specified by
the Seller (such Distribution Date, the "Reassignment Date") occurring within
-----------------
such applicable period on the terms and conditions set forth below; provided,
--------
however, that no such reassignment shall be required to be made if, at any time
-------
during such applicable period, the representations and warranties contained in
subsection 2.4(a) shall then be true and correct in all material respects. The
-----------------
Seller shall deposit on the Transfer Date (in New York Clearing House, next day
funds) for the Reassignment Date an amount equal to the reassignment deposit
amount for such Receivables in the Collection Account or Series Account, as
provided in the related Supplement, for distribution
-35-
to the Investor Certificateholders pursuant to Article XII. The reassignment
-----------
deposit amount with respect to each Series for such reassignment, unless
otherwise stated in the related Supplement, shall be equal to (i) the Investor
Interest of such Series at the end of the day on the last day of the Monthly
Period preceding the date on which the reassignment is scheduled to be made,
less the amount, if any, previously allocated (and on deposit in the applicable
Series Account) for payment of principal to such Certificateholders on the
related Distribution Date in the Monthly Period in which the date of
reassignment occurs, plus (ii) an amount equal to all interest accrued but
----
unpaid on the Investor Certificates of such Series at the applicable Certificate
Rate for the related Interest Accrual Period through the last day of such
Interest Accrual Period, less the amount, if any previously allocated for
payment of interest to the Certificateholders of such Series on the related
Distribution Date in the Monthly Period in which the date of reassignment occurs
plus (iii) an amount sufficient to pay all unreimbursed amounts owing to each
----
Enhancement Provider (to the extent set forth in the applicable Supplement).
The reassignment deposit amount with respect to each Series shall be deposited
in the Collection Account or any Series Account, as provided in the related
Supplement, for distribution to the Investor Certificateholders of such Series
pursuant to Section 12.3. Payment of the reassignment deposit amount with
------------
respect to each Series, and all other amounts in the Collection Account or the
applicable Series Account in respect of the preceding Monthly Period shall be
considered a prepayment in full of the Receivables represented by the Investor
Certificates. On the Distribution Date following the Transfer Date on which
such amount has been deposited in full into the Collection Account or the
applicable Series Account, the Receivables and all monies due or to become due
with respect thereto and all proceeds of the Receivables, Recoveries and
Interchange allocated to the Trust pursuant to subsections 2.5(k) and (l) shall
------------------ ---
be released to the Seller, or its designee or assignee, and the Trustee shall
execute and deliver such instruments of transfer or assignment, on behalf of the
Trust, in each case without recourse, representation or warranty, as shall be
reasonably requested by the Seller to vest in the Seller, or its designee or
assignee, all right, title and interest of the Trust in and to the Receivables,
all monies due or to become due with respect thereto and all proceeds of the
Receivables, Recoveries and Interchange allocated to the Trust pursuant to
subsections 2.5(k) and (l). If the Trustee or the Investor Certificateholders
------------------ ---
give notice directing the Seller to accept reassignment as provided above, the
obligation of the Seller to accept reassignment of the Receivables and pay the
reassignment deposit amount pursuant to this subsection 2.4(e) shall constitute
-----------------
the sole remedy respecting a breach of the representations and warranties
contained in subsection 2.4(a) available to the Investor
-----------------
-36-
Certificateholders or the Trustee on behalf of the Investor Certificateholders.
(f) Reassignment of Receivables in Additional Accounts. In the event of a
--------------------------------------------------
breach of any of the representations and warranties set forth in subsection 6(a)
or 6(e) of any Assignment of Receivables in Additional Accounts, in the form
attached hereto as Exhibit B, either the Trustee or the Holders of Investor
---------
Certificates evidencing Undivided Interests aggregating more than 50% of the
Aggregate Investor Interest, by notice then given in writing to the Seller (and
to the Trustee and the Servicer, if given by the Investor Certificateholders),
may direct the Seller to remove from the Trust each Receivable then existing in
an Account, the Receivables of which were conveyed to the Trust pursuant to such
Assignment of Additional Receivables, on the terms and conditions set forth
herein, on or prior to the first Distribution Date next succeeding 60 days after
such notice, and the Seller shall be obligated to remove such Receivables on a
Distribution Date occurring within such applicable period on the terms and
conditions set forth below; provided, however, that no such reassignment shall
-------- -------
be required to be made if, at any time during such applicable period the
representations and warranties contained in subsection 6(a) or 6(e), as the case
may be, of such Assignment of Additional Receivables shall then be true and
correct in all material respects. When the provisions of the preceding sentence
require removal of a Receivable, the Seller shall accept reassignment of the
portion of such Receivable that is a Principal Receivable by (i) directing the
Servicer to deduct the portion of such Receivable that is a Principal Receivable
of each such Ineligible Receivable from the aggregate amount of Principal
Receivables in the Trust and to decrease the Seller Interest by such amount and
(ii) depositing into the Collection Account an amount equal to the Finance
Charge Receivables collected through the date of such removal; provided,
--------
however, that if the exclusion of any Receivable from the calculation of the
-------
Seller Interest would cause the Seller Interest to be less than the Minimum
Seller Interest or would otherwise not be permitted by law, such Receivable
shall not be automatically removed from the Trust, but shall be removed from the
Trust only upon the making of the deposit to the Excess Funding Account referred
to in the second following sentence. On and after the date of such removal,
each such Receivable shall be deducted from the aggregate amount of Principal
Receivables used in the calculation of any Investor Percentage, the Seller
percentage or the Seller Interest; provided, however, that for the purposes of
-------- -------
subsection 2.6(a) and the calculation of the Seller Interest, each Ineligible
-----------------
Receivable shall, notwithstanding the proviso to the immediately preceding
sentence, be deemed to have been automatically removed from the Trust. In the
event that the exclusion of such Receivable from the calculation of the Seller
Interest would
-37-
cause the Seller Interest to be reduced below the Minimum Seller Interest, or
would otherwise not be permitted by law, the Seller shall immediately, but in no
event later than 10 days after such event, make a deposit in the Excess Funding
Account (for allocation as a Principal Receivable pursuant to Article IV) in
----------
immediately available funds in an amount equal to the amount by which the Seller
Interest (as determined above) would be reduced below the Minimum Seller
Interest. The portion of such deposit allocated to Investor Certificates of
each Series shall be distributed to the Investor Certificateholders of each such
Series in the manner specified in Article IV, if applicable, on the related
----------
Distribution Date in the Monthly Period following the Monthly Period in which
such deposit is made. Upon the reassignment to the Seller of any such
Receivable, the Trust shall automatically and without further action be deemed
to transfer, assign, set-over and otherwise convey to the Seller, without
recourse, representation or warranty, all the right, title and interest of the
Trust in and to such Ineligible Receivable, all monies due or to become due with
respect thereto and all proceeds thereof, Recoveries and Interchange allocated
to such Ineligible Receivable pursuant to subsections 2.5(k) and (l). The
------------------ ---
Trustee shall execute such documents and instruments of transfer or assignment,
on behalf of the Trust, and take other actions as shall reasonably be requested
by the Seller to evidence the conveyance of such Ineligible Receivable pursuant
to this subsection 2.4(f).
-----------------
If the Trustee or the Investor Certificateholders give notice directing the
Seller to accept reassignment as provided above, the obligation of the Seller to
accept reassignment of the Receivables and pay the reassignment deposit amount
pursuant to this subsection 2.4(f) shall constitute the sole remedy respecting a
-----------------
breach of the representations and warranties contained in subsection 6(a) or
6(e) of any Assignment of Receivables in Additional Accounts available to the
Investor Certificateholders or the Trustee on behalf of the Investor
Certificateholders.
SECTION 2.5 Covenants of the Seller. The Seller hereby covenants that:
-----------------------
(a) Receivables to be Accounts. The Seller will take no action to
--------------------------
cause any Receivable to be evidenced by any instrument (as defined in the
UCC as in effect in the States of Connecticut and New York) except in
connection with the enforcement or collection of an Account in which event
such Receivable shall be an Ineligible Receivable subject to repurchase in
accordance with Section 2.4(d)(ii). Each Receivable shall be payable
------------------
pursuant to a contract which does not create a Lien on any goods purchased
thereunder. The Seller will take no action to cause any Receivable to be
-38-
anything other than an "account" or a "general intangible" (as defined in
the UCC as in effect in the States of Connecticut and New York).
(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 (other than the
Trustee and the Certificateholders); provided, however, that nothing in
-------- -------
this subsection 2.5(b) shall prevent or be deemed to prohibit the Seller
-----------------
from suffering to exist upon any of the Receivables any Liens for municipal
or other local taxes if such taxes shall not at the time be due and payable
or if the Seller shall currently be contesting the validity thereof in good
faith by appropriate proceedings and shall have set aside on its books
adequate reserves with respect thereto.
(c) Periodic Finance Charges and Other Fees. The Seller hereby
---------------------------------------
agrees that, except as otherwise required by any Requirement of Law, or as
is deemed by the Seller to be necessary in order for the Seller to maintain
its credit card business, based upon a good faith assessment by the Seller,
in its sole discretion, of the nature of the competition in the credit card
business, it shall not at any time reduce the Periodic Finance Charges
assessed on any Receivable or other fees on any Account if, as a result of
such reduction, the Seller's reasonable expectation of the Portfolio Yield
as of such date would be less than the weighted average of the Base Rates
for all Series; provided, however, that the Seller shall not, unless
-------- -------
required by any Requirement of Law, reduce such Periodic Finance Charge if
its reasonable expectation is that the Portfolio Yield would be less than
the highest Certificate Rate with respect to any Series then issued and
outstanding.
(d) Credit Card Agreements and Account Guidelines. The Seller shall
---------------------------------------------
comply with and perform its obligations under the Credit Card Agreements
relating to the Accounts and the Account Guidelines and all applicable
rules and regulations of VISA USA, Inc. and MasterCard International
Incorporated except insofar as any failure so to comply or perform would
not materially and adversely affect the rights of the Trustee, on behalf of
the Trust, or the Certificateholders hereunder or under the Certificates.
The
-39-
Seller may change the terms and provisions of the Credit Card Agreements or
the Account Guidelines in any respect (including, without limitation, the
reduction of the required minimum monthly payment, the calculation of the
amount, or the timing, of charge offs and the Periodic Finance Charges and
other fees to be assessed thereon) with respect to the Accounts only (i) if
the Seller has a comparable segment of consumer revolving credit card
accounts (or consumer revolving accounts), if such change is made
applicable to the comparable segment of the consumer revolving credit card
accounts (or consumer revolving accounts) owned and serviced by the Seller
which have characteristics the same as, or substantially similar to, the
Accounts which are the subject of such change or (ii) if the Seller does
not own such a comparable segment of consumer revolving credit card
accounts (or consumer revolving accounts), if the Seller shall not make
such change with the intent to materially benefit the Seller over the
Certificateholders; provided, however, that the Seller will not increase
-------- -------
the timing of charge offs beyond the time which the Seller deems to be
necessary to maintain its credit card business, based upon a good faith
assessment of the Seller, in its sole discretion, of the nature of the
competition of the credit card business (provided, further, that accounts
-------- -------
purchased by the Seller from other credit card issuers, or other consumer
revolving credit accounts, shall not be considered to be a comparable
segment of revolving credit card accounts for the purposes of this
subsection 2.5(d) until such time as any of the accounts purchased by the
-----------------
Seller from such issuer or consumer revolving credit accounts, as the case
may be, become Accounts pursuant to the provisions of Section 2.6), except
--------------
as otherwise restricted by the terms of the Credit Card Agreements.
(e) Account Allocations.
-------------------
(i) In the event that the Seller is unable for any reason to
transfer Receivables to the Trust in accordance with the provisions of
this Agreement (including, without limitation, by reason of the
application of the provisions of Section 9.2 or an order by any
-----------
federal or state governmental agency having regulatory authority over
the Seller or any court of competent jurisdiction that the Seller not
transfer any additional Principal Receivables to the Trust) then, in
any such event, (A) the Seller agrees to allocate and pay to the
Trust, after the date of such inability, all Collections with respect
to Principal Receivables, and all amounts which would have constituted
Collections with respect to Principal Receivables but for the Seller's
inability to transfer
-40-
such Receivables (up to an amount equal to the Aggregate Principal
Receivables in the Trust on such date); (B) the Seller agrees to have
such amounts applied as Collections in accordance with Article IV; and
----------
(C) for only so long as all Collections and all amounts which would
have constituted Collections are allocated and applied in accordance
with clauses (A) and (B) above, Principal Receivables (and all amounts
----------- ---
which would have constituted Principal Receivables but for the
Seller's inability to transfer Receivables to the Trust) which are
written off as uncollectible in accordance with this Agreement shall
continue to be allocated in accordance with Article IV, and all
----------
amounts which would have constituted Principal Receivables but for the
Seller's inability to transfer Receivables to the Trust shall be
deemed to be Principal Receivables for the purpose of calculating (i)
the applicable Investor Percentage with respect to any Series and (ii)
the Aggregate Investor Percentage thereunder. If the Seller is unable
pursuant to any Requirement of Law to allocate Collections as
described above, the Seller agrees that, solely for purposes of
payments under this Agreement, it shall in any such event allocate,
after the occurrence of such event, payments on each Account with
respect to the principal balance of such Account first to the oldest
principal balance of such Account (it being understood that the
foregoing allocation does not affect, with respect to any Obligor, the
priority of application of cardholder payments provided for in the
related Credit Card Agreement(s)) and to have such payments applied as
Collections in accordance with Article IV. The parties hereto agree
----------
that Finance Charge Receivables, whenever created, accrued in respect
of Principal Receivables which have been conveyed to the Trust, or
which would have been conveyed to the Trust but for the above
described inability to transfer such Receivables, 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.
----------
(ii) In the event that, pursuant to subsection 2.4(d), the
-----------------
Seller accepts reassignment of an Ineligible Receivable as a result of
a breach of the representations and warranties in subsection 2.4(b)
-----------------
relating to such Receivable, then, in any such event, the Seller
agrees to account for payments received with respect to such
Ineligible Receivable separately from its accounting for Collections
on Principal Receivables
-41-
retained by the Trust. If payments received from or on behalf of an
Obligor are not specifically applicable either to an Ineligible
Receivable of such Obligor reassigned to the Seller or to the
Receivables of such Obligor retained in the Trust, then the Seller
agrees to allocate payments proportionately based on the total amount
of Principal Receivables of such Obligor retained in the Trust and the
total amount owing by such Obligor on any Ineligible Receivables
reassigned to the Seller, and the portion allocable to any Principal
Receivables retained in the Trust shall be treated as Collections and
deposited in accordance with the provisions of Article IV.
----------
(f) Delivery of Collections or Recoveries. The Seller agrees to pay
-------------------------------------
to the Servicer all payments received by the Seller in respect of the
Receivables as soon as practicable after receipt thereof by the Seller, but
in no event later than the second Business Day after the Date of Processing
of such payment.
(g) Conveyance of Accounts. The Seller covenants and agrees that it
----------------------
will not convey, assign, exchange or otherwise transfer the Accounts to any
Person prior to the termination of this Agreement pursuant to Article XII;
-----------
provided, however, that the Seller shall not be prohibited hereby from
-------- -------
conveying, assigning, exchanging or otherwise transferring the Accounts in
connection with a transaction complying with the provisions of Section 7.2.
-----------
(h) Notice of Liens. The Seller shall notify the Trustee promptly
---------------
after becoming aware of any Lien on any Receivable other than the
conveyances hereunder and Liens permitted under subsection 2.5(b) hereof.
-----------------
(i) Status of Accounts and Receivables. The Seller agrees to comply
----------------------------------
in all respects with all Requirements of Law applicable to the Seller, the
failure to comply with which would have a material adverse effect on the
Investor Certificateholders.
(j) VISA USA and MasterCard International. The Seller shall use its
-------------------------------------
best efforts to remain, either directly or indirectly, a member in good
standing of both the VISA USA, Inc. and the MasterCard International
Incorporated systems.
(k) Interchange. On each Business Day, the Seller shall pay to the
-----------
Servicer and the Servicer shall deposit into the Collection Account, for
allocation as collections of Finance Charge Receivables in the manner
provided in Article IV (in immediately available funds) the amount of
----------
-42-
Interchange received with respect to the Accounts to be so included as
Collections of Finance Charge Receivables.
(l) Recoveries. On or prior to each Determination Date, the Seller
----------
shall notify the Servicer of the amount of Recoveries to be included as
collections of Finance Charge Receivables with respect to the preceding
Monthly Period, which shall be equal to the product of (y) the total amount
of Recoveries received by the Seller in the preceding Monthly Period, and
(z) a fraction, the numerator of which is the Aggregate Principal
Receivables and the denominator of which is the aggregate principal amount
of the credit card receivables owned by the Seller with respect to such
Monthly Period. On each Transfer Date, the Seller shall pay to the
Servicer and the Servicer shall deposit into the Collection Account, for
allocation as collections of Finance Charge Receivables in the manner
provided in Article IV (in immediately available funds) the amount of
----------
Recoveries to be so included as Collections of Finance Charge Receivables
with respect to the preceding Monthly Period.
SECTION 2.6 Addition of Accounts.
--------------------
(a) All Accounts which meet the definition of Automatic Additional
Accounts which are Eligible Accounts shall be included as Accounts from and
after the date upon which such eligible Automatic Additional Accounts are
created and all Receivables in such Automatic Additional Accounts, whether such
Receivables are then existing or thereafter created, shall be transferred
automatically to the Trust upon origination by the Seller. The Seller, at its
option, may, by providing written notice to the Trustee and the Servicer,
terminate or suspend the inclusion of Automatic Additional Accounts at any time.
For all purposes of this Agreement, all receivables of such Automatic Additional
Accounts shall be treated as Receivables upon their creation and shall be
subject to the eligibility criteria specified in the definitions of "Eligible
Receivable" and "Eligible Account."
(b) On any day Receivables in Automatic Additional Accounts are created,
the Seller will be deemed to have made the representations in Section 2.4.
-----------
(c) Receivables in Automatic Additional Accounts shall be transferred to
the Trust, as Accounts if, in addition to satisfying the requirements of clauses
-------
(a) through (g) of the definition of Eligible Accounts, the following conditions
--- ---
are met: the number of Accounts the Receivables of which are designated to be
added to the Trust pursuant to subsection 2.6(a) since (i) the opening of
-----------------
business on the first day of the eleventh preceding Monthly Period (or, in the
case of any date on which eligible Automatic Additional Accounts are to be added
to
-43-
the Trust which occurs on or before May 31, 1994, the Cut-Off Date) minus the
-----
number of Accounts of the type described in clauses (b) and (c) of the
----------- ---
definition of "Automatic Additional Accounts" which have been added on the
initial day of the addition of such type of Account pursuant to such clauses (b)
-----------
and (c) since the opening of business on the first day of such eleventh
---
preceding Monthly Period (or the Cut-Off Date, as the case may be) plus the
----
number of Accounts, if any, the Receivables of which have been designated to be
added to the Trust since the opening of business on the first day of such
eleventh preceding Monthly Period (or the Cut-Off Date, as the case may be)
pursuant to subsection 2.6(e) minus any Removed Accounts removed since the
----------------- -----
opening of business on the first day of such eleventh preceding Monthly Period
(or the Cut-Off Date, as the case may be) shall not exceed 15% of the number of
Accounts at the opening of business on the first day of such eleventh preceding
Monthly Period (or the Cut-Off Date, as the case may be), and (ii) the opening
of business on the first day of the second preceding Monthly Period (or, in the
case of any date on which eligible Automatic Additional Accounts are to be added
to the Trust which occurs on or before August 31, 1993, the Cut-Off Date) minus
-----
the number of Accounts of the type described in clauses (b) and (c) of the
----------- ---
definition of "Automatic Additional Accounts" have been added on the initial day
of the addition of such type of Account pursuant to such clauses (b) and (c)
----------- ---
since the opening of business on the first day of such second preceding Monthly
Period (or the Cut-Off Date, as the case may be) plus the number of Accounts, if
----
any, the Receivables of which have been designated to be added to the Trust
since the opening of business on the first day of such second preceding Monthly
Period (or the Cut-Off Date, as the case may be) pursuant to subsection 2.6(e)
-----------------
minus any Removed Accounts removed since the first day of such second preceding
-----
Monthly Period (or the Cut-Off Date, as the case may be) shall not exceed 10% of
the number of Accounts at the opening of business on the first day of such
second preceding Monthly Period (or the Cut-Off Date, as the case may be).
(d) The Seller shall provide to the Trustee on each Determination Date, a
list of Automatic Additional Accounts, identified by account number, added
during the preceding Monthly Period.
(e) If (i) on any Record Date the Seller Interest for the related Monthly
Period, is less than the Minimum Seller Interest, the Seller shall designate
additional credit card accounts ("Additional Accounts") to be included as
-------------------
Accounts in a sufficient amount such that the Seller Interest as a percentage of
the Aggregate Principal Receivables for such Monthly Period after giving effect
to such addition is at least equal to the Minimum Seller Interest, or (ii) on
any date of determination the Aggregate Principal Receivables is less than the
Minimum
-44-
Aggregate Principal Receivables, the Seller shall designate Additional Accounts
to be included as Accounts in a sufficient amount such that the aggregate amount
of Principal Receivables will be equal to or greater than the Minimum Aggregate
Principal Receivables. Receivables from such Additional Accounts shall be
transferred to the Trust on or before the tenth Business Day following such
Record Date.
(f) In addition to its obligation under subsection 2.6(e), the Seller may
-----------------
upon twenty Business Days' notice to the Trustee, any Enhancement Provider if so
provided in the applicable Supplement and each Rating Agency, but shall not be
obligated to, designate from time to time Additional Accounts of the Seller to
be included as Accounts.
(g) The Seller agrees that any such transfer of Receivables from
Additional Accounts, under subsection 2.6(e) or (f), shall satisfy the following
----------------- ---
conditions (to the extent provided below):
(i) on or before (A) the twentieth Business Day prior to the Addition
Date for Additional Accounts to be included as Accounts pursuant to
subsection 2.6(f) or (B) the fifth Business Day prior to the Addition Date
-----------------
for Additional Accounts to be included as Accounts pursuant to subsection
----------
2.6(e) (the "Addition Notice Date"), the Seller shall give the Trustee, the
------ --------------------
Rating Agency, any Enhancement Provider if so provided in the applicable
Supplement and the Servicer written notice that such Additional Accounts
will be included and specifying the approximate aggregate amount of the
Receivables to be transferred;
(ii) on or before the Addition Date the Seller shall have delivered
to the Trustee a written assignment (including an acceptance by the Trustee
on behalf of the Trust for the benefit of the Investor Certificateholders)
in substantially the form of Exhibit B (each such assignment, an
---------
"Assignment") and shall record and file a financing statement in accordance
-----------
with the provisions for such filing set forth in Section 2.1 (a copy of
-----------
which shall be delivered to the Trustee) and the Seller shall have
indicated in its computer files that the Receivables created in connection
with the Additional Accounts, have been transferred to the Trust and,
within five Business Days thereafter, the Seller shall have delivered to
the Trustee a computer file or microfiche list containing a true and
complete list of all Additional Accounts, identified by account number,
which computer file or microfiche list shall be as of the date of such
Assignment incorporated into and made a part of such Assignment and this
Agreement;
-45-
(iii) the Seller shall represent and warrant that (x) each Additional
Account is, as of the end of the day immediately preceding the Addition
Date, an Eligible Additional Account, (y) no selection procedures believed
by the Seller to be materially adverse to the interests of the Investor
Certificateholders (without regard to any Enhancement) were utilized in
selecting the Additional Accounts from the available Eligible Additional
Accounts, and (z) as of the Addition Date, the Seller is not insolvent;
(iv) the Seller shall represent and warrant that, as of the Addition
Date, the Assignment constitutes either (x) a valid transfer and assignment
to the Trustee, on behalf of the Trust, of all right, title and interest of
the Seller in and to (A) the Receivables then existing and thereafter
created in the Additional Accounts, (B) all monies due or to become due
with respect thereto (including all Finance Charge Receivables), (C) all
proceeds of such Receivables (as defined in the UCC as in effect in the
State of New York), (D) Recoveries relating to such Receivables, (E) all
funds deposited from time to time in any Series Account then existing,
including any reserve account, cash collateral account or spread account,
and (F) Interchange allocated to the Trust pursuant to subsection 2.5(k)
-----------------
and proceeds thereof, Recoveries and Interchange allocated to the Trust
pursuant to subsections 2.5(k) and (l) will be held by the Trust (other
------------------ ---
than the Trustee and the Certificateholders) free and clear of any Lien of
any Person, except for (i) Liens permitted under subsection 2.5(b) and
-----------------
subject to Section 9-306 of the UCC as in effect in the States of
Connecticut or New York, whichever is applicable, (ii) the interest of the
Seller as Holder of the Exchangeable Seller Certificate and (iii) the
Seller's right to receive interest accruing on, and investment earnings in
respect of, the Collection Account, or any Series Account as provided in
this Agreement and any related Supplement; or (y) the grant of a security
interest (as defined in the UCC as in effect in the State of New York) in
such property to the Trust, which is enforceable with respect to then
existing Receivables of the Additional Accounts, the proceeds (as defined
in the UCC as in effect in the State of New York) thereof, Recoveries and
Interchange allocated to the Trust pursuant to subsections 2.5(k) and (l)
------------------ ---
upon the conveyance of such Receivables to the Trust, and which will be
enforceable with respect to the Receivables thereafter created in respect
of Additional Accounts conveyed on such Addition Date, the proceeds (as
defined in the UCC as in effect in the State of New York) thereof,
Recoveries and Interchange allocated to the Trust pursuant to subsections
-----------
2.5(k) and (l), upon such creation; and (z) if the
------ ---
-46-
Assignment constitutes the grant of a security interest to the Trust in
such property, upon the filing of a financing statement as described in
Section 2.1 with respect to such Additional Accounts and, in the case of
-----------
the Receivables thereafter created in such Additional Accounts and the
proceeds (as defined in the UCC as in effect in the State of New York)
thereof, Recoveries and Interchange allocated to the Trust pursuant to
subsections 2.5(k) and (l), upon such creation, the Trust shall have a
------------------ ---
first priority perfected security interest in such property, except for
Liens permitted under subsection 2.5(b) and subject to Section 9-306 of the
-----------------
UCC as in effect on the States of Connecticut or New York, whichever is
applicable;
(v) the Seller shall deliver a certificate of a Vice President or
more senior officer to the Trustee confirming the items set forth in
paragraphs (iii) and (iv) above and clause 6 of the Assignment;
---------------- ----
(vi) the Seller shall deliver an Opinion of Counsel with respect to
the Receivables in the Additional Accounts to the Trustee with a copy to
the Rating Agency substantially in the form of Exhibit F; and
---------
(vii) Standard & Poor's shall have confirmed in writing that the
inclusion of such accounts as Additional Accounts pursuant to subsection
----------
2.6(e) or (f), as the case may be, and Moody's shall have confirmed in
------ ---
writing that the inclusion of such accounts as Additional Accounts pursuant
to subsection 2.6(f) will not result in the reduction or withdrawal of its
-----------------
then existing rating of any Series of Investor Certificates then issued and
outstanding and the Seller shall have delivered such confirmation to the
Trustee and the related Enhancement Provider to the extent so provided in
the applicable Supplement.
SECTION 2.7 Removal of Accounts.
-------------------
(a) If on any Determination Date the Seller Interest exceeds 10% of the
Aggregate Principal Receivables on such Determination Date, the Seller may, but
shall not be obligated to, designate Receivables from Accounts for deletion and
removal ("Removed Accounts") from the Trust, including Expired Accounts
----------------
designated pursuant to Section 2.8; provided, however, that the Seller shall not
----------- -------- -------
make more than one such designation in any Monthly Period in addition to any
such designation pursuant to Section 2.8. On or before the fifth Business Day
(the "Removal Notice Date") prior to the date on which the designated Removed
-------------------
Accounts will be reassigned by the Trustee to the Seller, including any
reassignment pursuant to Section 2.8 (the "Removal Date"), the Seller shall give
----------- ------------
the Trustee and the Servicer
-47-
written notice that the Receivables from such Removed Accounts are to be
reassigned to the Seller and specifying the approximate aggregate amount of the
Receivables to be reassigned; provided, however, that the provisions set forth
-------- -------
in Section 2.8 shall constitute the notice to the Trustee required by this
-----------
Section 2.7(a) with respect to Receivables from Expired Accounts to be
--------------
designated from time to time for deletion and removal from the Trust and for
reassignment to the Seller on each Expired Account Removal Date.
(b) The Seller shall be permitted to designate and require reassignment to
it of the Receivables from Removed Accounts, including any reassignment pursuant
to Section 2.8, only upon satisfaction of the following conditions:
-----------
(i) [reserved];
(ii) [reserved];
(iii) the removal of any Receivables of any Removed Accounts on any
Removal Date shall not, in the reasonable belief of the Seller, (a) cause a
Pay Out Event to occur; provided, however, that for the purposes of this
-------- -------
subsection 2.7(b)(iii), the Receivables of each Removed Account shall be
----------------------
considered to have been removed as of the Removal Date, (b) cause the
Seller Interest as a percentage of Aggregate Principal Receivables to be
less than 10% on such Removal Date or (c) result in the failure to make any
payment specified in the related Supplement with respect to any Series;
(iv) (A) on or prior to the Removal Date, the Seller shall have
delivered to the Trustee for execution a written assignment in
substantially the form of Exhibit I (the "Reassignment"); provided,
--------- ------------ --------
however, that the provisions set forth in Section 2.8 shall constitute such
------- -----------
a "Reassignment" with respect to Receivables from Expired Accounts to be
designated from time to time for deletion and removal from the Trust and
for reassignment to the Seller on each Expired Accounts Removal Date; and
(B) within five Business Days thereafter or, with respect to any removal
and reassignment of Expired Receivables pursuant to Section 2.8, after the
-----------
applicable Expired Accounts Removal Date, the Seller shall have delivered
to the Trustee a computer file or microfiche list or, in the case of a list
delivered pursuant to Section 2.8(b), a printed copy containing a true and
--------------
complete list of all Removed Accounts identified by account number and the
aggregate amount of the Principal Receivables in such Removed Accounts as
of the Removal Date, which computer file or microfiche list shall as of the
Removal Date modify and amend and be made a part of this Agreement;
-48-
(v) the Seller shall represent and warrant that no selection procedures
believed by the Seller to be materially adverse to the interests of the
Investor Certificateholders without regard to any Enhancement were utilized
in selecting the Removed Accounts to be removed from the Trust;
(vi) the Seller shall have delivered to the Trustee an Officer's
Certificate confirming the items set forth in clauses (iii), (iv), (v)
------------- ---- ---
above and (vii) and (viii) below (which certificate may, in the case of a
----- ------
removal and reassignment pursuant to Section 2.8, be substantially in the
-----------
form of Exhibit J hereto). The Trustee may conclusively rely on such
---------
Officer's Certificate, shall have no duty to make inquiries with regard to
the matters set forth therein and shall incur no liability in so relying;
(vii) on or before the twentieth Business Day prior to the Removal
Date the Rating Agency shall have received notice of such proposed removal
of Accounts (which notice may, in the case of each removal and reassignment
pursuant to Section 2.8, be in the form of a single notice in respect of
-----------
all removals and reassignments of Expired Accounts under Section 2.8);
-----------
(viii) the Seller and the Trustee shall have received notice from the
Rating Agency that such proposed removal of Accounts will not result in the
reduction or withdrawal of its then existing rating of any Series of
Certificates then issued and outstanding (which notice may, in the case of
each removal and reassignment pursuant to Section 2.8, be in the form of a
-----------
single notice from the Rating Agency addressing all removals and
reassignments of Expired Accounts under Section 2.8); and
-----------
(ix) the Seller, the Trustee and the Rating Agencies shall have
received an Opinion of Counsel that the proposed removal (or, in the case
of removals pursuant to Section 2.8, all removals and reassignments under
-----------
Section 2.8) shall not adversely effect the federal income tax
-----------
characterization of the Trust.
Upon satisfaction of the above conditions with respect to any removal and
reassignment of Receivables other than a removal and reassignment pursuant to
Section 2.8, the Trustee shall execute and deliver the Reassignment, on behalf
-----------
of the Trust, to the Seller, and the Receivables from the Removed Accounts shall
no longer constitute a part of the Trust as of the Removal Date. Upon
satisfaction of the above conditions, as applicable, with respect to any removal
and reassignment of Receivables pursuant to Section 2.8, the Receivables from
-----------
the Removed Accounts shall
-49-
no longer constitute a part of the Trust as of the related Expired Accounts
Removal Date.
SECTION 2.8 Periodic Removal of Expired Accounts.
------------------------------------
(a) Reassignment of Expired Accounts; Notice; Release of Liens.
----------------------------------------------------------
(i) The Trustee hereby transfers, assigns, sets-over and otherwise
conveys to the Seller, without recourse, representation or warranty, on
each Expired Accounts Removal Date, all right, title and interest of the
Trust in and to the Receivables from Expired Accounts now existing and
hereafter designated as Expired Accounts, all monies and investments due or
to become due with respect thereto (including all Finance Charge
Receivables and Recoveries), and all proceeds of such Receivables, and the
right to receive amounts paid as Interchange with respect to such Expired
Accounts, which Receivables shall have zero Receivables balances and which
monies, investments, proceeds and rights to receive amounts paid shall be
zero in aggregate amount.
(ii) In connection with the transfer described in Section 2.8(a)(i),
-----------------
the Trustee agrees to execute and deliver to the Seller such UCC
termination statements with respect to the Receivables now existing and
hereafter created in the Expired Accounts as the Seller may reasonably
request from time to time, evidencing the release by the Trust of its Lien
on the Receivables then existing and thereafter created in any such Removed
Accounts, in such manner and such jurisdictions as are necessary or
advisable to remove any such Lien, provided that such UCC termination
statements shall be prepared by the Servicer.
(b) Designation of Expired Accounts. The Seller shall, in accordance with
-------------------------------
Section 2.7(b)(iv)(B), deliver or cause to be delivered to the Trustee, not
---------------------
later than five Business days after each Expired Accounts Removal Date, a
computer file, microfiche list or printed copy containing a true and complete
list of all Accounts constituting Expired Accounts with respect to such Expired
Accounts Removal Date, identified by Account number, and containing the
aggregate amount of the Principal Receivables in such Expired Accounts as of
such Removal Date, which aggregate amount shall be zero.
(c) Representations and Warranties of the Seller Relating to the Expired
--------------------------------------------------------------------
Accounts. The Seller hereby represents and warrants to the Trustee and the
--------
Trust as of the date hereof and as of each Expired Accounts Removal Date as
follows:
-50-
(i) Absence of Pay Out Event or Certain Other Events. The removal of
------------------------------------------------
any Receivables from any Expired Account on any Expired Accounts Removal
Date will not, in the reasonable belief of the Seller (1) cause a Pay Out
Event to occur (for which purposes the Receivables of each Expired Account
shall be considered to have been removed as of the corresponding Expired
Accounts Removal Date), (2) cause the Seller Interest as a percentage of
the Aggregate Principal Receivables to be less than 10% on any such Expired
Accounts Removal Date, or (3) result in the failure to make any payment in
the related Supplement with respect to any Series.
(ii) Selection Procedures. No selection procedures believed by the
--------------------
Seller to be materially adverse to the interests of the Investor
Certificateholders without regard to any Enhancement were utilized or will
be utilized in selecting the Expired Accounts to be removed from the Trust.
(iii) Notice to Moody's and Standard and Poor's. The Seller has
-----------------------------------------
provided notice to each of Moody's and Standard and Poor's of the proposed
deletion and removal from the Trust of Receivables from the Expired
Accounts under this Section 2.8, such notice being provided on or before
the twentieth Business Day prior to any of the Expired Accounts Removal
Dates on which such Receivables will be deleted and removed from the Trust
and reassigned to the Seller.
(d) Conditions to Reassignment. The reassignment by the Trustee set forth
--------------------------
in Section 2.8(a) hereof with respect to any Expired Accounts Removal Date (and,
--------------
with respect to clause (i) below, each portion thereof, as applicable) is
subject to the satisfaction, on or prior to such Expired Accounts Removal Date
(or, in the case of Sections 2.7(b)(iv)(B) and 2.8(b), within five Business Days
---------------------- ------
after such Removal Date), of the conditions set forth in Section 2.7(b) and of
--------------
the following conditions:
(i) No Notice of Cancellation. The Seller shall not have notified
-------------------------
the Trustee on or prior to such Expired Accounts Removal Date that the
deletion and removal of Receivables from the related Expired Accounts as of
such date (or any portion thereof) has been cancelled or designated to
occur on a subsequent date set forth in such notice or to be set forth in a
subsequent notice by the Seller to the Trustee.
(ii) Officer's Certificate. The Seller shall have delivered to the
---------------------
Trustee within five (5) Business Days after such Expired Accounts Removal
Date an Officer's Certificate substantially in the form of Exhibit J
---------
hereto, certifying that (1) all requirements set forth in Section 2.7(a)
--------------
for
-51-
the designation of Expired Accounts and the deletion and removal from the
Trust and reassignment to the Seller of Receivables from Expired Accounts
have been satisfied as of such Expired Accounts Removal Date, (2) each of
the representations and warranties made by the Seller in Section 2.8(c) is
--------------
true and correct as of such Expired Accounts Removal Date, and (3) each of
the conditions to the deletion and removal from the Trust and reassignment
to the Seller of Receivables from the related Expired Accounts as of such
Expired Accounts Removal Date, set forth in Section 2.7(b) and this Section
-------------- -------
2.8(d), have been satisfied as of such Expired Accounts Removal Date. The
------
Trustee may conclusively rely on such Officer's Certificate, shall have no
duty to make inquiries with regard to the matters set forth therein, and
shall incur no liability in so relying.
(iii) Rating Agency Confirmation On or Prior to Expired Accounts
----------------------------------------------------------
Removal Dates. Each of the Seller and the Trustee shall have received
-------------
notice (in addition to the notice specified in Section 2.7(b)(viii)) from
each Rating Agency on or prior to such Expired Accounts Removal Date that
the proposed deletion and removal from the Trust of Receivables from
Expired Accounts on such Expired Accounts Removal Date pursuant to this
Section 2.8 will not result in the reduction or withdrawal of its then
-----------
existing rating of any Series of Certificates then issued and outstanding;
provided, however, that such additional notice shall be required solely
-------- -------
with respect to Expired Accounts Removal Dates on which (1) the sum of (x)
the number of Expired Accounts the Receivables of which are proposed to be
deleted and removed from the Trust on such Expired Accounts Removal Date
pursuant to this Section 2.8 and (y) the number of Expired Accounts the
-----------
Receivables of which have been deleted and removed from the Trust pursuant
to this Section 2.8 since the last day of the quarterly period immediately
-----------
preceding the quarterly period in which such Expired Accounts Removal Date
occurs (any such quarterly period being, for purposes of this Section 2.8,
-----------
January through March, April through June, July through September or
October through December, as applicable, of the corresponding calendar
year) exceeds 15% of the number of Accounts as of such last day of such
immediately preceding quarterly period or (2) the sum of (x) the number of
Expired Accounts the Receivables of which are proposed to be deleted and
removed from the Trust on such Expired Accounts Removal Date pursuant to
this Section 2.8 and (y) the number of Expired Accounts the Receivables of
-----------
which have been deleted and removed from the Trust pursuant to this Section
-------
2.8 since the last day of the calendar year immediately preceding the
---
calendar year in which such Expired Accounts Removal Date
-52-
occurs exceeds 20% of the number of Accounts as of such last day of the
immediately preceding calendar year.
(e) Reassignment Agreement Superseded. On and after the first Expired
---------------------------------
Accounts Removal Date, the provisions of this Section 2.8 shall supersede the
-----------
Omnibus Reassignment of Receivables Agreement, dated as of December 12, 1996,
between People's Bank and the Trustee, whereupon such agreement shall be of no
further force and effect with respect to all removals and reassignments of
Expired Accounts occurring on and after such Expired Accounts Removal Date.
[End of Article II]
-53-
ARTICLE III
ADMINISTRATION AND SERVICING
OF RECEIVABLES
SECTION 3.1 Acceptance of Appointment and Other Matters Relating to the
-----------------------------------------------------------
Servicer.
--------
(a) The Seller agrees to act as the Servicer under this Agreement. The
Investor Certificateholders by their acceptance of the Certificates consent to
the Seller acting as Servicer.
(b) The Servicer shall service and administer the Receivables and shall
collect payments due under the Receivables in accordance with its customary and
usual servicing procedures for servicing credit card receivables comparable to
the Receivables and in accordance with the Account Guidelines and the covenants
of the Seller set forth in Section 2.5, including the covenants set forth in
-----------
Sections 2.5(e)(i) and (ii) (which the Servicer hereby agrees to perform in
------------------ ----
full), and the Servicer shall have full power and authority, acting alone or
through any party properly designated by it hereunder, to do any and all things
in connection with such servicing and administration which it may deem necessary
or desirable. Without limiting the generality of the foregoing and subject to
Section 10.1, the Servicer is hereby authorized and empowered, (i) unless such
------------
power and authority is revoked by the Trustee on account of the occurrence of a
Servicer Default pursuant to Section 10.1, to make withdrawals and payments, or
------------
to instruct the Trustee to make withdrawals and payments, from the Collection
Account, the Excess Funding Account and any Series Account, in accordance with
such instructions as set forth in this Agreement, (ii) unless such power and
authority is revoked by the Trustee on account of the occurrence of a Servicer
Default pursuant to Section 10.1, to instruct the Trustee in writing, as set
------------
forth in this Agreement, (iii) to execute and deliver, on behalf of the Trust
for the benefit of the Certificateholders, any and all instruments of
satisfaction or cancellation, or of partial or full release or discharge, and
all other comparable instruments, with respect to the Receivables and, after the
delinquency of any Receivable and to the extent permitted under and in
compliance with applicable law and regulations, to commence enforcement
proceedings with respect to such Receivables and (iv) to make any filings,
reports, notices, applications, 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 or reporting requirements laws. The
Trustee agrees that it shall promptly follow the instructions of the Servicer to
withdraw funds from the Collection Account, the Excess Funding Account or any
Series Account and to take any
-54-
action required under any Enhancement at such time as required under this
Agreement. The Trustee shall furnish the Servicer with any documents necessary
or appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder.
(c) [Reserved]
(d) [Reserved]
(e) The Servicer shall not be obligated to use servicing procedures,
offices, employees or accounts for servicing the Receivables which are separate
from the procedures, offices, employees and accounts used by the Servicer in
connection with servicing other credit card receivables.
(f) The Servicer shall maintain blanket bond coverage insuring against
losses through wrongdoing of its officers and employees who are involved in the
servicing of credit card receivables covering such actions and in such amounts
as the Servicer believes to be reasonable from time to time.
SECTION 3.2 Servicing Compensation. As compensation for its servicing
----------------------
activities hereunder and reimbursement for its expenses as set forth in the
immediately following paragraph, the Servicer shall be entitled to receive a
monthly servicing fee in respect of any Monthly Period prior to the termination
of the Trust pursuant to Section 12.1 (with respect to each Monthly Period, the
------------
"Monthly Servicing Fee"). The share of the Monthly Servicing Fee allocable to
---------------------
each Series of Investor Certificateholders with respect to any Monthly Period
(or portion thereof) shall be payable on the related Transfer Date and, with
respect to each Series (unless otherwise provided in the related Supplement),
shall be equal to one-twelfth of the product of (A) the applicable Series
Servicing Fee Percentage per annum and (B) the Investor Interest of such Series
as of the last day of the Monthly Period preceding such Transfer Date (the
"Monthly Investor Servicing Fee") and shall be paid to the Servicer pursuant to
-------------------------------
Article IV. The servicing fee payable by the Holder of the Exchangeable Seller
----------
Certificate shall be equal to the product of one-twelfth of the product of (A)
the Seller Interest and (B) the lesser of 2% and the weighted average Series
Servicing Fee Percentage with respect to any Series of Investor Certificates
then outstanding (the "Monthly Seller Servicing Fee"). The Monthly Servicing
----------------------------
Fee shall equal the sum of (x) the aggregate amount of Monthly Investor
Servicing Fees with respect to each Series then outstanding and (y) the Monthly
Seller Servicing Fee. The Monthly Investor Servicing Fee with respect to any
Series is payable in arrears on the related Transfer Date (unless otherwise
provided in the related Supplement) and the Monthly Seller Servicing Fee is
payable in arrears no later than
-55-
the last Transfer Date with respect to any Series occurring in a Monthly Period.
The Monthly Seller Servicing Fee and, unless otherwise provided in a Supplement,
each Monthly Investor Servicing Fee shall be calculated on the basis of a 360-
day year consisting of twelve 30-day months.
The Servicer's expenses include the amounts due to the Trustee pursuant to
Section 11.5 and of the Paying Agent, Transfer Agent and Registrar and the
------------
reasonable fees and disbursements of independent public accountants and all
other expenses incurred by the Servicer in connection with its activities
hereunder; provided, that the Servicer shall not be liable 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 or local 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). The Servicer shall be required to pay such
expenses for its own account and shall not be entitled to any payment therefor
other than the Monthly Servicing Fee.
SECTION 3.3 Representations and Warranties of the Servicer. People's
----------------------------------------------
Bank, as initial Servicer, hereby makes, and any Successor Servicer by its
appointment hereunder shall make, the following representations and warranties
on which the Trustee has relied in accepting the Receivables in trust and in
authenticating the Certificates issued on the Closing Date:
(a) Organization and Good Standing. The Servicer is duly organized,
------------------------------
validly existing and in good standing under the laws of the State of its
organization and has full power, authority and legal right to own its
properties and conduct its credit card business as such properties are
presently owned and such business is presently conducted, and to execute,
deliver and perform its obligations under this Agreement.
(b) Due Qualification. The Servicer is not required to qualify nor
-----------------
register as a foreign corporation in any state in order to service the
Receivables as required by this Agreement and has obtained all licenses and
approvals necessary in order to so service the Receivables as required
under federal law and the law of the State of its organization. If the
Servicer shall be required by any Requirement of Law to so qualify or
register or obtain such license or approval, then it shall do so.
(c) Due Authorization. The execution, delivery, and performance of
-----------------
this Agreement have been duly authorized by the Servicer, by all necessary
corporate action on the part
-56-
of the Servicer, and this Agreement will remain, from the time of its
execution, an official record of the Servicer.
(d) Binding Obligation. This Agreement 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.
(e) No Violation. The execution and delivery of this Agreement by
------------
the Servicer, and the performance of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof 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 is 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, 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 seeking any determination or ruling that would materially and
adversely affect the validity or enforceability of this Agreement.
(g) Compliance with Requirements of Law. The Servicer shall duly
-----------------------------------
satisfy all obligations on its part to be fulfilled under or in connection
with each Receivable and the related Account, will maintain in effect all
qualifications required under Requirements of Law in order to properly
service each Receivable and the related Account and will comply in all
material respects with all other Requirements of Law in connection with
servicing each Receivable and the related Account the failure to comply
with which would have a material adverse effect on the Certificateholders.
(h) Servicer's Deposit Accounts. As of the Initial Closing Date,
---------------------------
deposits in the Servicer's deposit accounts
-57-
were insured to the limits provided by law and as required by the FDIC.
(i) All Consents Required. All approvals, authorizations, consents,
---------------------
orders or other actions of any Person or of any Governmental Authority or
official required in connection with the execution and delivery of this
Agreement, the performance of the transactions contemplated by this
Agreement and the fulfillment of the terms hereof have been obtained.
(j) Status of Accounts and Receivables. The Servicer hereby agrees
----------------------------------
to comply in all material respects with all Requirements of Law applicable
to the Servicer the failure to comply with which would have a material
adverse effect on the Investor Certificateholders.
(k) No Rescission or Cancellation. The Servicer shall not permit any
-----------------------------
rescission or cancellation of any Receivable except in accordance with the
Account Guidelines or as ordered by a court of competent jurisdiction or
other Governmental Authority.
(l) Protection of Certificateholder's Rights. The Servicer shall
----------------------------------------
take no action which, nor omit to take any action the omission of which,
would impair the rights of Certificateholders in any Receivable or the
related Account, nor shall it reschedule, revise or defer payments due on
any Receivable except in accordance with the Account Guidelines.
(m) Receivables Not To Be Evidenced by Promissory Notes. The
---------------------------------------------------
Servicer will take no action to cause any Receivable to be evidenced by any
instrument (as defined in the UCC as in effect in the State of New York)
except in connection with its enforcement or collection of an Account, in
which event such Receivable shall be reassigned or assigned and transferred
to the Servicer as provided in the following paragraph.
In the event (x) any of the representations and warranties or covenants of
the Servicer contained in subsections (g), (j), (k), (l) and (m) with respect to
--------------- --- --- --- ---
any Receivable or the related Account is breached, and such breach has a
material adverse effect on the Certificateholders' interest in such Receivable
and is not cured within 60 days (or such longer period, not in excess of 120
days, as may be agreed to by the Trustee) of the earlier to occur of the
discovery of such event by the Servicer, or receipt by the Servicer of written
notice of such event given by the Trustee or any Enhancement Provider (to the
extent so provided in the applicable Supplement), or (y) it is so provided in
subsection 3.3(m) with respect to any Receivable, all
-----------------
-58-
Receivables in the Account or Accounts as to which such event relates shall be
reassigned to the Seller (if the Seller is the Servicer) or assigned and
transferred (if the Seller is not the Servicer) to the Servicer on the terms and
conditions set forth below.
If the Holder of the Exchangeable Seller Certificate is the Servicer, such
assignment or reassignment shall be accomplished in the manner set forth in
subsection 2.4(d)(iii) as if the reassigned or assigned Receivables were
----------------------
Ineligible Receivables (including the requirement, if applicable, to reduce the
Seller Interest, the Seller Percentage or the Investor Percentage and to make
deposits into the Excess Funding Account) and any amounts deposited in the
Excess Funding Account to be applied in accordance with Section 4.2(e).
--------------
If the Holder of the Exchangeable Seller Certificate is not the Servicer,
the Servicer shall effect such assignment and transfer by making a deposit into
the Collection Account for allocation pursuant to Article IV in immediately
----------
available funds no later than the Transfer Date following the Monthly Period in
which such assignment and transfer obligation arises in an amount equal to the
amount of such Receivable.
Upon each such reassignment or assignment and transfer to the Servicer of
an Ineligible Receivable, the Trust shall automatically and without further
action be deemed to transfer, assign, set over and otherwise convey to the
Servicer, without recourse, representation or warranty, all the right, title and
interest of the Trust in and to such Ineligible Receivable, all monies due or to
become due with respect thereto and all proceeds thereof, Recoveries and
Interchange allocated to such Ineligible Receivable pursuant to subsections
-----------
2.5(k) and (l). The Trustee shall execute such documents and instruments of
------ ---
transfer or assignment, on behalf of the Trust, and take other actions as shall
reasonably be requested by the Seller to evidence the conveyance of such
Ineligible Receivable pursuant to this Section 3.3. Notwithstanding any other
-----------
provision of this Section 3.3, a reassignment of an Ineligible Receivable to the
-----------
Seller in excess of the amount that would cause the Seller Interest to be less
than the Minimum Seller Interest shall not occur if the Seller fails to make any
deposit required by this Section 3.3 with respect to such Ineligible Receivable.
-----------
The obligation of the Servicer set forth in this Section 3.3 to accept
-----------
reassignment or assignment and transfer of such Ineligible Receivable, as the
case may be, shall constitute the sole remedy respecting any breach of the
representations and warranties set forth in the above-referenced subsections
with respect to such Receivable available to Certificateholders or the Trustee
on behalf of Certificateholders.
-59-
SECTION 3.4 Reports and Records for the Trustee.
-----------------------------------
(a) Daily Reports. On each Business Day, the Servicer, with prior notice,
-------------
shall prepare and make available at the office of the Servicer for inspection by
the Trustee a record setting forth (i) the aggregate amount of Collections
processed by the Servicer on the preceding Business Day, (ii) the Aggregate
Receivables as of the close of business on the second preceding Business Day,
and (iii) in the event Additional Accounts or Automatic Additional Accounts were
added during the Monthly Period immediately preceding the day such Collections
were processed, the aggregate amount of Principal Receivables in such Additional
Accounts or Automatic Additional Accounts. The Servicer shall at all times
maintain its computer files with respect to the Accounts in such a manner so
that the Accounts may be specifically identified and, upon prior request of the
Trustee, shall make available to the Trustee at the servicing center of the
Servicer selected by the Servicer on any Business Day during the Servicer's
normal business hours any computer programs necessary to make such
identification.
(b) Monthly Servicer's Certificate. Unless otherwise stated in the
------------------------------
related Supplement with respect to any Series, on each Determination Date the
Servicer shall forward, as provided in Section 13.5, to the Trustee, the Paying
------------
Agent, and the Rating Agency, a certificate of a Servicing Officer in the form
of Exhibit C (which includes the Schedule thereto specified as such in each
---------
Supplement) setting forth (i) the aggregate amount of Collections processed
during the preceding Monthly Period, (ii) the aggregate amount of the applicable
Investor Percentage of Collections of Principal Receivables processed by the
Servicer pursuant to Article IV during the preceding Monthly Period with respect
----------
to each Series then outstanding, (iii) the aggregate amount of the applicable
Investor Percentage of Collections allocated to Finance Charge Receivables
processed by the Servicer pursuant to Article IV during the preceding Monthly
----------
Period with respect to each Series then outstanding, (iv) the aggregate amount
of Receivables as of the end of the last day of the preceding Monthly Period,
(v) the balance on deposit in the Collection Account (or Collection Subaccount)
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, if any, of withdrawals, drawings or payments
under any Enhancement, if any, for each Series then outstanding required to be
made with respect to the previous Monthly Period in the manner provided in the
related Supplement, (vii) the statement required by Article V in the form
---------
indicated in the Supplement for each Series then outstanding, (viii) the sum of
all amounts payable to the Certificateholders of each Series on the succeeding
Distribution Date with respect to each Series in respect of certificate
-60-
interest and certificate principal, (ix) the excess, if any, of the Aggregate
Principal Receivables over the Aggregate Principal Receivables required to be
maintained pursuant to this Agreement and any Supplement as of such
Determination Date, (x) whether, with respect to each Series then outstanding, a
Series Pay Out Event or a Trust Pay Out Event has occurred or other similar
event is deemed to have occurred and (xi) such other matters as are set forth in
Exhibit C.
---------
(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 thirty (30) days after the
end of the Monthly Period within which the Transferred Account is created, a
notice specifying the new account number for any Transferred Account and the
replaced account number.
SECTION 3.5 Annual Servicer's Certificate. On or before March 31 of each
-----------------------------
calendar year, beginning with March 31, 1994 the Servicer will deliver, as
provided in Section 13.5, to the Trustee, the Rating Agency, and any Certificate
------------
Owner, upon the written request of such Certificate Owner, an Officer's
Certificate substantially in the form of Exhibit D stating that (a) a review of
---------
the activities of the Servicer during the twelve-month period ending on December
31 of such year, or for the initial period, from the Closing Date until December
31, 1993, and of its performance under this Agreement was made under the
supervision of the officer signing such certificate and (b) to the best of such
officer's knowledge, based on such review, the Servicer has fully performed all
its obligations under this Agreement throughout such period, or, if there has
been a default in the performance of any such obligation, specifying each such
default known to such officer and the nature and status thereof. A copy of such
certificate may be obtained by any Investor Certificateholder by a request in
writing to the Trustee addressed to the Corporate Trust Office.
SECTION 3.6 Annual Independent Accountants' Servicing Report.
------------------------------------------------
(a) On or before March 31 of each calendar year, beginning with March 31,
1994, the Servicer shall cause a firm of nationally recognized independent
accountants (who may also render other services to the Servicer or the Seller)
to furnish, as provided in Section 13.5, a report to the Trustee, the Servicer,
------------
the Rating Agency, and any Certificate Owner, upon the written request of such
Certificate Owner, to the effect that such firm has made a study and evaluation
of the Servicer's internal accounting controls relative to the servicing of
Accounts under this Agreement, and that, on the basis of such study and
evaluation, such firm is of the opinion (assuming the
-61-
accuracy of any reports generated by the Servicer's third party agents) that the
system of internal accounting controls in effect on the date set forth in such
report, relating to servicing procedures performed by the Servicer pursuant to
Article IV of this Agreement, taken as a whole, was sufficient for the
----------
prevention and detection of errors and irregularities in amounts that would be
material to the financial statements of the Servicer and that such servicing was
conducted in compliance with Article IV of this Agreement, except for such
----------
exceptions, errors or irregularities as such firm shall believe to be immaterial
to the financial statements of the Servicer and such other exceptions, errors or
irregularities as shall be set forth in such report. Unless otherwise provided
with respect to any Series in the related Supplement, a copy of such report may
be obtained by any Investor Certificateholder by a request in writing to the
Trustee addressed to the Corporate Trust Office.
(b) On or before March 31 of each calendar year, beginning with March 31,
1994, the Servicer shall cause a firm of nationally recognized independent
accountants (who may also render other services to the Servicer or the Seller)
to furnish, as provided in Section 13.5, a report to the Trustee, Servicer, the
------------
Rating Agency and any Certificate Owner, upon the written request of such
Certificate Owner, to the effect that they have compared the amounts set forth
in the monthly statements and certificates forwarded by the Servicer pursuant to
subsection 3.4(b) during the period covered by such report (which shall be the
-----------------
period from January 1 of the preceding calendar year to and including December
31 of such calendar year, or for the initial period, from the Closing Date until
December 31, 1993) with the Servicer's computer reports and statements of any
agents engaged by the Servicer to perform servicing activities which were the
source of such amounts and that on the basis of such comparison, such amounts
are in agreement, except for such exceptions as it believes to be immaterial to
the financial statements of the Servicer and such other exceptions as shall be
set forth in such report. A copy of such report may be obtained by any Investor
Certificateholder by a request in writing to the Trustee addressed to the
Corporate Trust Office.
SECTION 3.7 Tax Treatment. The Seller has structured this Agreement and
-------------
the Certificates with the intention that the Certificates will qualify under
applicable federal, state, local and foreign tax law as indebtedness secured by
the Receivables. The Seller, the Servicer, the Trustee, the Holder of the
Exchangeable Seller Certificate, each Investor Certificateholder, and each
Certificate Owner, agrees to treat and to take no action inconsistent with the
treatment of the Investor Certificates (or beneficial interest therein) as
indebtedness for purposes of federal, state, local and foreign income or
franchise taxes and any other tax imposed on or measured by income. Each
Investor
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Certificateholder and the Holder of the Exchangeable Seller Certificate, by
acceptance of its Certificate and each Certificate Owner, by acquisition of a
beneficial interest in a Certificate, agrees to be bound by the provisions of
this Section 3.7. Each Certificateholder 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 indebtedness under applicable tax law, as
described in this Section 3.7.
-----------
SECTION 3.8 Notices to the Seller. In the event that the Seller is no
---------------------
longer acting as Servicer, any Successor Servicer appointed pursuant to Section
-------
10.2 shall deliver or make available to the Seller each certificate and report
----
required to be prepared, forwarded or delivered thereafter pursuant to Sections
--------
3.4, 3.5 and 3.6.
--- --- ---
[End of Article III]
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ARTICLE IV
RIGHTS OF CERTIFICATEHOLDERS AND ALLOCATION
AND APPLICATION OF COLLECTIONS
SECTION 4.1 Establishment of Accounts and Allocations with Respect to the
-------------------------------------------------------------
Exchangeable Seller Certificate.
-------------------------------
(a) The Collection Account. The Servicer, for the benefit of the
----------------------
Certificateholders, shall establish and maintain in the name of the Trustee, on
behalf of the Trust, or cause to be established and maintained, a non-interest
bearing segregated trust account (the "Collection Account") bearing a
------------------
designation clearly indicating that the funds deposited therein are held in
trust for the benefit of the Certificateholders, with an office or branch
located in the State of Connecticut or New York, of (i) the corporate trust
department of a Qualified Trust Institution or (ii) a depository institution or
trust company (which may include the Servicer, the Trustee or an Affiliate of
the Servicer) having corporate trust powers under applicable federal and state
laws organized under the laws of the United States of America or any one of the
states thereof or the District of Columbia; provided, however, that at all times
-------- -------
the certificates of deposit, short-term deposits or commercial paper or the
long-term unsecured debt obligations (other than such obligation whose rating is
based on collateral or on the credit of a Person other than such institution or
trust company) of such depository institution or trust company shall have a
credit rating from Moody's and Standard & Poor's of P-1 and A-1+, respectively,
in the case of the certificates of deposit, or a rating from Moody's, of at
least Aa3 and from Standard & Poor's of at least AAA in the case of the long-
term unsecured debt obligations and the deposits in whose accounts are insured
to the limits provided by law and by the FDIC (each entity referred to in
clauses (i) and (ii) a "Qualified Institution"); provided further, that upon the
----------- ---- --------------------- -------- -------
insolvency of the Servicer, the Collection Account shall not be permitted to be
maintained with the Servicer. The Supplement for a Series may require the
Trustee to establish and maintain a subaccount of the Collection Account for
such a Series (such subaccount, a "Collection Subaccount") bearing a designation
---------------------
clearly indicating that the funds deposited therein are held in trust for the
benefit of the Certificateholders of such Series with a depository institution
or trust company meeting the criteria provided in the related Supplement. The
Collection Account or any Collection Subaccount may not be invested except as
provided in the related Supplement. The funds on deposit in such Collection
Subaccount may be invested in the manner provided in the related Supplement, and
any earnings resulting from such investment shall be applied as provided in such
Supplement. Pursuant to authority granted to it pursuant to subsection 3.1(b),
-----------------
the Servicer shall have the power,
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revocable by the Trustee, to withdraw funds from the Collection Account or any
Collection Subaccount for the purposes of carrying out its duties hereunder.
Each Series of Investor Certificates shall represent interests in the
Trust, including the benefits of any Enhancement to be provided by an
Enhancement Provider issued with respect to such Series as indicated in the
Supplement relating to such Series, and the right to receive Collections and
other amounts at the times and in the amounts specified in this Article IV to be
----------
deposited in the Collection Account and any Series Accounts maintained for the
benefit of the Certificateholders of such Series or paid to the
Certificateholders of such Series. The Exchangeable Seller Certificate shall
represent the interest in the Trust not represented by any Series of Investor
Certificates then outstanding, including the right to receive Collections and
other amounts at the time and in the amounts specified in this Article IV to be
----------
paid to the Seller (the "Seller Interest"); provided, however, that such
--------------- -------- -------
certificate shall not represent any interest in the Collection Account or any
Series Accounts maintained for the benefit of the Certificateholders of any
Series or the benefits of any Enhancement to be provided by an Enhancement
Provider issued with respect to any Series, except as specifically provided in
this Article IV.
----------
(b) Establishment of the Excess Funding Account. The Servicer, for the
-------------------------------------------
benefit of the Investor Certificateholders and the Holder of the Exchangeable
Seller Certificate, shall establish and maintain or cause to be established and
maintained in the name of the Trustee, on behalf of the Trust, with a Qualified
Institution and held in trust by such Qualified Institution designated by the
Servicer, a segregated trust account within the corporate trust department of
such Qualified Institution (the "Excess Funding Account"), bearing a designation
----------------------
clearly indicating that the funds deposited therein are held in trust for the
benefit of the Investor Certificateholders and the holder of the Exchangeable
Seller Certificate. 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. Pursuant to the authority granted to it pursuant to
subsection 3.1(b), the Servicer shall have the power, revocable by the Trustee,
-----------------
to withdraw funds and to instruct the Trustee to withdraw funds from the Excess
Funding Account for the purposes of carrying out its duties hereunder.
(c) If the entity with which any of the accounts established pursuant to
this Section 4.1 ceases to be a "Qualified Institution", then (i) such entity
-----------
shall provide the Trustee, each Enhancement Provider and the Servicer with
prompt written notice that it is no longer a "Qualified Institution" and (ii)
transfer the funds deposited in each of the accounts in the
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manner directed by the Servicer within 10 Business Days of the day on which such
entity ceased to be a "Qualified Institution".
(d) Allocations for the Exchangeable Seller Certificate. Throughout the
---------------------------------------------------
existence of the Trust, the Servicer shall, prior to the close of business on
the day any Collections are deposited in the Collection Account, allocate to the
Holder of the Exchangeable Seller Certificate an amount equal to the product of
(A) the Seller Percentage for the current Monthly Period and (B) the aggregate
amount of such Collections allocated to Principal Receivables and Finance Charge
Receivables, respectively. The Servicer need not deposit this amount, and other
amounts so allocated to the Exchangeable Seller Certificate pursuant to any
Supplement, into the Collection Account, and shall pay, or be deemed to pay, to
the extent the Servicer is the holder of the Exchangeable Seller Certificate,
such amounts as collected to the Holder of the Exchangeable Seller Certificate;
provided, however, that such payments shall not be made to the Holder of the
-------- -------
Exchangeable Seller Certificate if the Seller Interest is less than the Minimum
Seller Interest or if and to the extent that such payment would cause the Seller
Interest to be less than the Minimum Seller Interest but such amounts shall be
treated as Shared Principal Collections.
SECTION 4.2 Collection and Allocations.
--------------------------
(a) Collections. The Servicer shall, subject to subsection 4.1(d),
----------- -----------------
deposit all Collections in the Collection Account as promptly as possible after
the Date of Processing of such Collections, but in no event later than the
second Business Day following such Date of Processing. In the event of the
insolvency of the Servicer, then, immediately upon the occurrence of such event
and thereafter the Servicer shall deposit all Collections into the Collection
Account which shall be established and maintained with a Qualified Institution
other than the Servicer in accordance with subsection 4.1(a), and in no such
-----------------
event shall the Servicer deposit any Collections thereafter into any account
established, held or maintained with the Servicer.
Interchange shall be allocated, and deposited or paid, on the second
Business Day following the Business Day on which the Servicer receives the same
in the manner provided in subsection 2.5(k). Recoveries shall be allocated and
-----------------
deposited or paid, on each Transfer Date in the manner provided in subsection
----------
2.5(1). The Servicer shall notify the Trustee as to the amount of Recoveries
------
allocable to the Trust on each Determination Date and transfer such amount into
the Collection Account on the Transfer Date.
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The Servicer shall allocate such amounts to each Series of Investor
Certificates and to the Holder of the Exchangeable Seller Certificate in
accordance with Article IV and shall withdraw the required amounts from the
----------
Collection Account or pay such amounts to the Holder of the Exchangeable Seller
Certificate in accordance with Article IV. The Servicer shall make such
----------
deposits or payments on the date indicated therein by wire transfer or as
otherwise provided in the Supplement for any Series of Certificates with respect
to such Series.
Notwithstanding anything in this Agreement to the contrary, for so long as,
and only so long as, the Seller shall remain the Servicer hereunder and (a) (i)
the Servicer provides to the Trustee a letter of credit or other arrangement
covering risk of collection of the Servicer acceptable to the Rating Agency (as
evidenced by letters from the Rating Agency) and (ii) the Seller and the Trustee
shall have received a notice from the Rating Agency that such letter of credit
or other arrangement would not result in the lowering or withdrawal of such
Rating Agency's then-existing rating of any Series of Investor Certificates then
outstanding or (b) the Servicer, or for so long as the Seller is the Servicer
and an Affiliate of People's Bank, People's Bank (unless Moody's or Standard &
Poor's shall have notified the Servicer that making monthly deposits will result
in the reduction or withdrawal of its then-existing rating of the Certificates)
shall have and maintain a certificate of deposit or short-term deposit rating of
P-1 by Moody's and of at least A-1 by Standard & Poor's and deposit insurance as
required by law and by the FDIC, the Servicer need not deposit Collections to
the Collection Account in the manner provided in this Article IV or make
----------
payments to the Holder of the Exchangeable Seller Certificate prior to the close
of business on the day any Collections are deposited in the Collection Account
as provided in Article IV, but may make such deposits, payments and withdrawals
----------
on the Transfer Date in the Monthly Period following the Monthly Period in which
such amounts were collected in an amount equal to the net amount of such
deposits, payments and withdrawals which would have been made but for the
provisions of this paragraph.
(b) Allocation of Collections Between Finance Charge Receivables and
----------------------------------------------------------------
Principal Receivables. On each Business Day, the Servicer shall allocate
---------------------
Collections processed on the Accounts to Finance Charge Receivables to the
extent of the sum of (i) the amount of Finance Charge Receivables billed on such
Accounts on such day and (ii) the amount of any Finance Charge Receivables for
prior days which were not covered by Collections for such prior days or by
Collections thereafter allocated to Finance Charge Receivables; provided,
--------
however, that all Collections which constitute Recoveries and Interchange shall
-------
be allocated to Finance Charge Receivables as shall investment earnings with
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respect to amounts on deposit in the Excess Funding Account. The balance of the
Collections processed on any Account for any Monthly Period shall be allocated
to Principal Receivables.
(c) Allocation of Collections of Recoveries and Defaulted Accounts.
--------------------------------------------------------------
(i) On the date on which an Account becomes a Defaulted Account, the
Trust shall automatically and without further action or consideration be
deemed to transfer, set over, and otherwise convey to the Seller, without
recourse, representation or warranty, all the right, title and interest of
the Trust in and to the Receivables in such Defaulted Account, all monies
due or to become due with respect thereto, all proceeds of such Receivables
and Interchange allocable to the Trust with respect to such Receivables,
excluding Recoveries relating to such Defaulted Account, which shall remain
a part of the Trust Assets.
(ii) On each Determination Date, the Servicer shall calculate the
Investor Default Amount for the preceding Monthly Period with respect to
each Series.
(d) Adjustments for Miscellaneous Credits and Fraudulent Charges.
------------------------------------------------------------
(i) The Servicer shall be obligated to reduce or adjust, as the case
may be, on a net basis the aggregate amount of Principal Receivables as
provided in this subsection 4.2(d) (a "Credit Adjustment") with respect to
----------------- -----------------
any Principal Receivable (A) which was created in respect of merchandise
refused or returned by the Obligor thereunder or as to which the Obligor
thereunder has asserted a counterclaim or defense, (B) which is reduced by
the Servicer by any charge-back or adjustment, (C) which was created as a
result of a fraudulent or counterfeit charge, (D) which is reduced by
adjustments relating to returned or dishonored checks, or (E) which results
from Servicer error.
(ii) In the event that the exclusion of the amount of a Credit
Adjustment from the calculation of the Seller Interest would cause the
Seller Interest to be an amount less than the Minimum Seller Interest, the
Holder of the Exchangeable Seller Certificate shall make a deposit, no
later than the Business Day following the Date of Processing of such Credit
Adjustment, in the Excess Funding Account (for allocation as a Principal
Receivable pursuant to Article IV) in immediately available funds in an
----------
amount equal to the amount by which such Credit Adjustment would have
reduced the Seller Interest below the Minimum Seller Interest.
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(e) Unallocated Principal Collections; Excess Funding Account. On each
---------------------------------------------------------
Business Day, Shared Principal Collections shall be allocated to outstanding
Series pro rata based on the Principal Shortfall, if any, for each such Series.
The Servicer shall pay any remaining Shared Principal Collections on such
Business Day to the holder of the Exchangeable Seller Certificate; provided that
--------
to the extent that the Seller Interest as determined on such Business Day does
not exceed the Minimum Seller Interest, such Shared Principal Collections shall
be deposited in the Excess Funding Account, or, on and after the first day of
the Amortization Period with respect to any Series, such Shared Principal
Collections shall be deposited in the principal funding account of such Series
to the extent specified in the related Supplement until the principal funding
account of such Series has been funded in full or the Holders of the Investor
Certificates of such Series have been paid in full; provided, further, that if
-------- -------
an Amortization Period has commenced and is continuing with respect to more than
one outstanding Series, such Shared Principal Collections shall be allocated to
such Series pro rata based on the Investor Percentage for Principal Receivables
applicable for such Series.
(f) Amounts in Excess Funding Account. Amounts on deposit in the Excess
---------------------------------
Funding Account on any Business Day will be invested by the Seller (or, at the
direction of the Seller, by the Servicer or the Trustee on behalf of the Seller)
in Permitted Investments maturing on the next Business Day. Earnings from such
investments received shall be deposited in the Collection Account and treated as
Collections of Finance Charge Receivables. Any investment instructions to the
Trustee shall be in writing and shall include a certification that the proposed
investment is a Permitted Investment that matures at or prior to the date
required by this Agreement. If on any Business Day the Seller Interest is
greater than the Minimum Seller Interest, amounts on deposit in the Excess
Funding Account shall be released to the Holder of the Exchangeable Seller
Certificate. On each Business Day, amounts on deposit in the Excess Funding
Account (other than investment earnings thereon) shall be allocated to each
outstanding series in an Amortization Period pro rata based on the aggregate
outstanding principal amount of such series on the last day of the applicable
Revolving Period.
[THE REMAINDER OF ARTICLE IV IS RESERVED AND SHALL
BE SPECIFIED IN ANY SUPPLEMENT WITH RESPECT TO ANY
SERIES]
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ARTICLE V
[ARTICLE V IS RESERVED AND SHALL
BE SPECIFIED IN ANY SUPPLEMENT
WITH RESPECT TO ANY SERIES]
-70-
ARTICLE VI
THE CERTIFICATES
SECTION 6.1 The Certificates. Subject to Sections 6.10 and 6.11, the
---------------- ------------- ----
Investor Certificates of each Series and any class thereof may be issued in
bearer form (the "Bearer Certificates") with attached interest coupons and a
-------------------
special coupon (collectively, the "Coupons") or in fully registered form (the
-------
"Registered Certificates"), and shall be substantially in the form of the
exhibits with respect thereto attached to the related Supplement. The
Exchangeable Seller Certificate shall be substantially in the form of Exhibit A.
---------
The Investor Certificates and the Exchangeable Seller Certificate shall, upon
issuance pursuant hereto or to Section 6.9 or Section 6.11, be executed and
----------- ------------
delivered by the Seller to the Trustee for authentication and redelivery as
provided in Section 6.2. The Investor Certificates shall be issuable in a
-----------
minimum denomination of $1,000 and integral multiples thereof unless otherwise
specified in any Supplement. If specified in the related Supplement for any
Series, the Investor Certificates shall be issued upon initial issuance as a
single certificate in an original principal amount equal to the Initial Investor
Interest as described in Section 6.10. The Exchangeable Seller Certificate
------------
shall also be issued as a single certificate. 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 the individual who was, at the time when such signature was
affixed, authorized to sign on behalf of the Seller or the Trustee shall not be
rendered invalid, notwithstanding that such individual has 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. Unless otherwise
provided in the related Supplement, no Certificate 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 Responsible Officer of the Trustee, and such certificate upon any
Certificate shall be conclusive evidence, and the only evidence, that such
Certificate has been duly authenticated and delivered hereunder. All
Certificates shall be dated the date of their authentication (as applicable)
except Bearer Certificates which shall be dated the applicable Issuance Date as
provided in the related Supplement.
SECTION 6.2 Authentication of Certificates. Contemporaneously with the
------------------------------
initial assignment and transfer of the Receivables, whether now existing or
hereafter created and the other components of the Trust Assets to the Trust, the
Trustee
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shall authenticate and deliver the initial Series of Investor Certificates, upon
the order of the Seller, to the underwriters for the sale of the Book-Entry
Certificates evidenced by such Investor Certificates, and against payment to the
Seller of the Initial Investor Interest (net of any purchase discount or
underwriting discounts). Upon the receipt of such payment and the issuance of
the Investor Certificates, such Investor Certificates shall be fully paid and
non-assessable. The Trustee shall authenticate and deliver the Exchangeable
Seller Certificate to the Seller simultaneously with its delivery to the Seller
of the initial Series of Investor Certificates. Upon an Exchange as provided in
Section 6.9 and the satisfaction of certain other conditions specified therein,
-----------
the Trustee shall authenticate and deliver the Investor Certificates of
additional Series (with the designation provided in the related Supplement),
upon the order of the Seller, to the persons designated in such Supplement.
Upon the order of the Seller, the Certificates of any Series shall be duly
authenticated by or on behalf of the Trustee, in authorized denominations equal
to (in the aggregate) the Initial Investor Interest of such Series of Investor
Certificates. If specified in the related Supplement for any Series, the
Trustee shall authenticate and deliver outside the United States the Global
Certificate that is issued upon original issuance thereof, upon the written
order of the Seller, to the Depository as provided in Section 6.10 against
------------
payment of the purchase price therefor. If specified in the related Supplement
for any Series, the Trustee shall authenticate Book-Entry Certificates that are
issued upon original issuance thereof, upon the written order of the Seller, to
a Clearing Agency or its nominee as provided in Section 6.11 against payment of
------------
the purchase price thereof.
SECTION 6.3 Registration of Transfer and Exchange of Certificates.
-----------------------------------------------------
(a) The Trustee shall cause to be kept at the office or agency to be
maintained by a transfer agent and registrar (the "Transfer Agent and
------------------
Registrar"), 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, the Transfer Agent and Registrar shall provide for the
registration of the Investor Certificates of each Series (unless otherwise
provided in the related Supplement) and of transfers and exchanges of the
Investor Certificates as herein provided. Bankers Trust Company is hereby
initially appointed Transfer Agent and Registrar for the purposes of registering
the Investor Certificates and transfers and exchanges of the Investor
Certificates as herein provided. In the event that Bankers Trust Company shall
no longer be the Transfer Agent and Registrar, the Trustee shall appoint a
successor Transfer Agent and Registrar reasonably acceptable to the Seller and
the Servicer.
-72-
The Trustee may revoke such appointment and remove Bankers Trust Company as
Transfer Agent and Registrar if the Trustee determines in its sole discretion
that Bankers Trust Company failed to perform its obligations under this
Agreement in any material respect. Bankers Trust Company shall be permitted to
resign as Transfer Agent and Registrar upon 30 days' written notice to the
Seller and the Servicer; provided, however, that such resignation shall not be
-------- -------
effective and Bankers Trust Company 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 and the
Servicer.
Upon surrender for registration of transfer of any Certificate at any
office or agency of the Transfer Agent and Registrar, the Seller shall execute
subject to the provisions of subsection 6.3(d), and the Trustee shall
-----------------
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Certificates in authorized denominations of like
aggregate fractional Undivided Interests; provided, however, that the provisions
-------- -------
of this paragraph shall not apply to Bearer Certificates.
At the option of an Investor Certificateholder, Investor Certificates may
be exchanged for other Investor Certificates of the same Series in authorized
denominations of like aggregate fractional Undivided Interests, upon surrender
of the Investor Certificates to be exchanged at any such office or agency. At
the option of any Registered Certificateholder, Registered Certificates may be
exchanged for other Registered Certificates of the same Series in authorized
denominations of like aggregate Undivided Interests in the Trust, upon surrender
of the Registered Certificates to be exchanged at any office or agency of the
Transfer Agent and Register maintained for such purpose. At the option of a
Bearer Certificateholder, subject to applicable laws and regulations, Bearer
Certificates may be exchanged for other Bearer Certificates or Registered
Certificates of the same Series in authorized denominations of like aggregate
Undivided Interests in the Trust, in the manner specified in the Supplement for
such Series 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 6.3 shall
-----------
have attached thereto (or be accompanied by) all unmatured coupons, provided
that any Bearer Certificate so surrendered after the close of business on the
Record Date preceding the relevant Distribution Date after the related Series
Termination Date need not have attached the Coupons related to such Distribution
Date.
-73-
The preceding provisions of this Section 6.3 notwithstanding, the Trustee
-----------
or the Transfer Agent and Registrar, as the case may be, shall not be required
to register the transfer of or exchange any Investor Certificate of any Series
for a period of 15 days preceding the due date for any payment with respect to
the Investor Certificate of such Series.
Whenever any Investor Certificates of any Series are so surrendered for
exchange, the Seller shall execute, and the Trustee shall authenticate and
(unless the Transfer Agent and Registrar is different than the Trustee, in which
case the Transfer Agent and Registrar shall) deliver, the Investor Certificates
of such Series which the 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 and the Transfer Agent and Registrar duly
executed by the Certificateholder thereof or his attorney-in-fact duly
authorized in writing.
Unless otherwise provided in the related Supplement, 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 transfer or exchange of Investor Certificates.
All Investor Certificates (together with any Coupons attached to Bearer
Certificates) surrendered for registration of transfer or exchange shall be
cancelled by the Transfer Agent and Registrar and disposed of in the Trustee's
normal and customary manner. The Trustee shall cancel and destroy the Global
Certificate upon its exchange in full for Definitive Certificates and shall
deliver a certificate of destruction to the Seller. Such certificates shall
also state that a certificate or certificates of each Foreign Clearing Agency
was received with respect to each portion of the Global Certificate exchanged
for Definitive Certificates.
The Seller shall execute and deliver to the Trustee or the Transfer Agent
and Registrar as applicable, 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 and the Certificates.
(b) Except as provided in Section 6.9 or 7.2, in no event shall the
----------- ---
Exchangeable Seller Certificate or any interest therein be transferred
hereunder, in whole or in part, unless the Seller shall have consented in
writing to such transfer and unless the Trustee shall have received (i) a
Supplement specifying the Principal Terms of such Series, if applicable, (ii) if
required
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by the Supplement (if any), the form of Enhancement, (iii) if an Enhancement is
required by the Supplement (if any), an appropriate Enhancement Agreement, (iv)
the existing Exchangeable Seller Certificate and, if applicable, the
certificates representing the Series to be exchanged, (v) an Officer's
Certificate of the Seller that on the date the Exchange or transfer occurs,
after giving effect to such Exchange or transfer, the Seller Interest will be at
least equal to the Minimum Seller Interest, (vi) confirmation in writing from
the Rating Agency that such transfer will not result in a reduction or
withdrawal of its then-existing rating of any Series of Investor Certificates
then outstanding, (vii) an Opinion of Counsel that such transfer (x) does not
adversely affect the Federal or state income tax characterization of any class
of Investor Certificates as indebtedness secured by the Receivables, (y) will
not result in the Trust being classified as an association taxable as a
corporation for Federal income tax purposes, or as a taxable entity for
applicable state income tax purposes and (z) will not be treated as an exchange
to any outstanding class of Investor Certificateholders, and (viii) in the case
of the transfer of the Exchangeable Seller Certificate as a whole, an agreement
supplemental hereto, executed and delivered to the Trustee in form satisfactory
to the Trustee, in which the transferee of the Exchangeable Seller Certificate
expressly assumes the performance of every covenant and obligation of the
Seller, as Holder of the Exchangeable Seller Certificate, as applicable
hereunder, and pursuant to which such transferee shall benefit from all the
rights granted to the Seller, as Holder of the Exchangeable Seller Certificate,
applicable hereunder; provided that a transfer of the Exchangeable Seller
Certificate shall not release the Seller from any of its obligations under this
Agreement unless effected pursuant to Section 7.2(b).
--------------
The Holder of the Exchangeable Seller Certificate, by its acceptance of the
Exchangeable Seller Certificate, acknowledges that its obligation to make the
payments required by Section 4.2(d)(ii) is a full recourse obligation.
------------------
(c) The Transfer Agent and Registrar will maintain at its expense in the
Borough of Manhattan, the City of New York (and subject to Section 6.3, if
-----------
specified in the related Supplement for any Series, any other city designated in
such Supplement) an office or offices or an agency or agencies where Investor
Certificates of such Series 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).
(d) Unless otherwise provided in the related Supplement, registration of
transfer of Registered Certificates containing a
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legend relating to the restrictions on transfer of such Registered Certificates
(which legend shall be set forth in the Supplement relating to such Investor
Certificates) shall be effected only if the conditions set forth in such related
Supplement are satisfied.
Whenever a Registered Certificate containing the legend set forth in the
related Supplement 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. The Transfer Agent and
Registrar and the Trustee shall be entitled to receive written instructions
signed by a Servicing Officer prior to registering any such transfer or
authenticating new Registered Certificates, as the case may be. The Servicer
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 reliance on any such written
instructions furnished pursuant to subsection 6.3(d).
-----------------
(e) Notwithstanding any other provision of this Agreement, any Certificate
for which an Opinion of Counsel has not been issued to the effect that such
Certificate constitutes debt for Federal income tax purposes (each, a "Subject
-------
Certificate") shall be subject to the limitations of this subsection 6.3(e). No
----------- -----------------
Subject Certificates shall be issued in a transaction (or transactions) that is
required to be registered under the Securities Act or, to the extent any such
offering or sale of Subject Certificates is not required to be registered under
the Securities Act by reason of Regulation S (17 CFR 230.901 through 230.904) or
any successor thereto, that would be required to be registered under the
Securities Act if the interests so offered or sold were offered and sold within
the United States of America. No transfer (or purported transfer) of all or any
part of a Subject Certificate (or any economic interest therein), whether to
another Certificateholder or to a Person that is not a Certificateholder, shall
be effective, and any such transfer (or purported transfer) shall be void ab
--
initio, and no Person shall otherwise become a Holder of a Subject Certificate
------
if (i) at the time of such transfer (or purported transfer) any Subject
Certificates or interests therein are traded on an established securities market
or readily tradeable on a secondary market or the substantial equivalent thereof
or (ii) after such transfer (or purported transfer) the Trust would have more
than 100 Holders of Subject Certificates. For purposes of clause (i) of the
----------
immediately preceding sentence, an established securities market is (A) a
national securities exchange that is either registered under Section 6 of the
Exchange Act or exempt from registration because of the limited volume of
transactions, (B) a
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foreign securities exchange that, under the law of the jurisdiction where it is
organized, satisfies regulatory requirements that are analogous to the
regulatory requirements of the Exchange Act, (C) a regional or local exchange,
or (D) an interdealer quotation system that regularly disseminates firm buy or
sell quotations by identified brokers or dealers by electronic means or
otherwise. For purposes of such clause (i), Subject Certificates are readily
----------
tradeable on a secondary market or the substantial equivalent thereof if (1)
Subject Certificates (or interests therein) are regularly quoted by any Person,
such as a broker or dealer, making a market in the interests; (2) any Person
regularly makes available to the public (including customers or subscribers) bid
or offer quotes with respect to Subject Certificates (or interests therein) and
stands ready to effect buy or sell transactions at the quoted prices for itself
or on behalf of others; (3) the Holders of Subject Certificates have a readily
available, regular, and ongoing opportunity to sell or exchange the Subject
Certificates (or interests therein) through a public means of obtaining or
providing information of offers to buy, sell, or exchange such interests; or (4)
prospective buyers and sellers otherwise have the opportunity to buy, sell, or
exchange the Subject Certificates (or interests therein) in a time frame and
with the regularity and continuity that is comparable to that described in
clauses (1), (2) and (3) of this sentence. For purposes of determining whether
----------- --- ---
the Trust will have more than 100 Holders of Subject Certificates, each Person
indirectly owning an interest in a Subject Certificate through a partnership
(including any entity treated as a partnership for federal income tax purposes),
a grantor trust or an S corporation (each such entity a "flow-through entity")
-------------------
shall be treated as a Holder of a Subject Certificate unless the Servicer
determines in its sole discretion, after consulting with qualified tax counsel,
that less than substantially all of the value of the beneficial owner's interest
in the flow-through entity is attributable to the flow-through entity's interest
(direct or indirect) in the Trust.
SECTION 6.4 Mutilated, Destroyed, Lost or Stolen Certificates. If (a) any
-------------------------------------------------
mutilated Certificate (together, in the case of Bearer Certificates, with all
unmatured Coupons, if any, pertaining 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 a bona fide purchaser, the Seller shall execute and the
Trustee shall authenticate and (unless the Transfer Agent and Registrar is
different from the Trustee, in which case the Transfer Agent and Registrar
shall) deliver (in compliance with applicable law), in exchange for or in lieu
of any such
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mutilated, destroyed, lost or stolen Certificate, a new Certificate of like
tenor and aggregate Undivided Interest. In connection with the issuance of any
new Certificate under this Section 6.4, the Trustee or the Transfer Agent and
-----------
Registrar may require the payment 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 the Transfer Agent
and Registrar) connected therewith. Any duplicate Certificate issued pursuant
to this Section 6.4 shall constitute complete and indefeasible evidence of
-----------
ownership in the Trust, as if originally issued, whether or not the lost, stolen
or destroyed Certificate shall be found at any time.
SECTION 6.5 Persons Deemed Owners. Prior to due presentation of a
---------------------
Certificate (other than a Bearer Certificate) for registration of transfer, the
Trustee, the Paying Agent, the Transfer Agent and Registrar and any agent of any
of them may treat the Person in whose name any Certificate is registered as the
owner of such Certificate for the purpose of receiving distributions pursuant to
Article V and for all other purposes whatsoever, and none of the Trustee, the
---------
Paying Agent, the Transfer Agent and Registrar nor any agent of any of them
shall be affected by any notice to the contrary; provided, however, that in
-------- -------
determining whether the holders of Investor Certificates evidencing the
requisite Undivided Interests have given any request, demand, authorization,
direction, notice, consent or waiver hereunder, Investor Certificates owned by
the Seller, the Servicer or any Affiliate thereof shall be disregarded and
deemed not to be outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Investor Certificates which a
Responsible Officer in the Corporate Trust Office of the Trustee knows to be so
owned shall be so disregarded.
In the case of a Bearer Certificate, the Trustee, the Paying Agent, the
Transfer Agent and Registrar and any agent of any of them may 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 Article IV and
----------
Article XII and for all other purposes whatsoever, and neither the Trustee, the
-----------
Paying Agent, the Transfer Agent and Registrar nor any agent of any of them
shall be affected by any notice to the contrary. Certificates so owned which
have been pledged in good faith shall not be disregarded and may be regarded as
outstanding, if the pledgee establishes to the satisfaction of the Trustee the
pledgee's right so to act with respect to such Investor Certificates and that
the pledgee is not the Seller, the Servicer or an Affiliate thereof.
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SECTION 6.6 Appointment of Paying Agent.
---------------------------
(a) The Paying Agent shall make distributions to Investor
Certificateholders from the appropriate account or accounts maintained for the
benefit of Certificateholders as specified in the related Supplement for any
Series pursuant to Articles IV and V hereof. Any Paying Agent shall have the
----------- -
revocable power to withdraw funds from such appropriate account or accounts for
the purpose of making 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 in any material respect or for other than good cause. The
Paying Agent, unless the Supplement with respect to any Series states otherwise,
shall initially be Bankers Trust Company. Bankers Trust Company shall be
permitted to resign as Paying Agent upon 30 days' written notice to the Servicer
effective only upon the appointment of another Paying Agent. In the event that
Bankers Trust Company shall no longer be the Paying Agent, the Trustee shall
appoint a successor to act as Paying Agent (which shall be a bank or trust
company). The Trustee shall cause such successor Paying Agent or any additional
Paying Agent appointed by the Trustee to execute and deliver to the Trustee an
instrument in which such successor Paying Agent or additional Paying Agent shall
agree with the Trustee that as Paying Agent, such successor Paying Agent or
additional Paying Agent 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
Certificateholders. The Paying Agent shall return all unclaimed funds to the
Collection Account or such other Series Account established pursuant to the
Supplement with respect to any Series in the manner provided in the related
Supplement and upon removal of a Paying Agent, such Paying Agent shall return
all funds in its possession to the Collection Account or such other account
established pursuant to the Supplement with respect to any Series in the manner
provided in the related Supplement. The provisions of Sections 11.1, 11.2 and
------------- ----
11.3 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 co-paying agent unless the context requires
otherwise.
If specified in the related Supplement for any Series, so long as the
Investor Certificates of such Series are outstanding, the Seller shall maintain
a co-paying agent in New York City (for Registered Certificates only) or any
other city designated in such Supplement which, if and so long as any Series of
Investor Certificates is listed on the Luxembourg Stock Exchange or other stock
exchange and such exchange so requires, shall be in Luxembourg or the location
required by such other stock exchange.
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(b) The Trustee shall cause the Paying Agent (other than itself) to
execute and deliver to the Trustee an instrument in which such Paying Agent
shall agree with the Trustee that such Paying Agent will hold all sums, if any,
held by it for payment to the Certificateholders in trust for the benefit of the
Certificateholders entitled thereto until such sums shall be paid to such
Certificateholders and shall agree, and if the Trustee is the Paying Agent it
hereby agrees, that it shall comply with all requirements of the Internal
Revenue Code regarding the withholding by the Trustee of payments in respect of
federal income taxes due from Certificate Owners.
SECTION 6.7 Access to List of Certificateholders' Names and Addresses.
---------------------------------------------------------
The Trustee will furnish or cause to be furnished by the Transfer Agent and
Registrar to the Servicer or the Paying Agent, within five Business Days after
receipt by the Trustee of a request therefor from the Servicer or the Paying
Agent, respectively, in writing, a list of the names and addresses of the
Investor Certificateholders (other than Bearer Certificateholders) as of the
most recent Record Date for payment of distributions to Investor
Certificateholders. Unless otherwise provided in the related Supplement, if
holders of Investor Certificates evidencing Undivided Interests aggregating not
less than 10% of the Investor Interest of the Investor Certificates of any
Series then outstanding (the "Applicants") apply in writing to the Trustee, and
----------
such application states that the Applicants desire to communicate with other
Investor Certificateholders of any Series with respect to their rights under
this Agreement or under the Investor Certificates and is accompanied by a copy
of the communication which 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 Certificateholders (other than Bearer Certificateholders) held by the
Trustee and shall give the Servicer notice that such request has been made,
within a reasonable time but in any event not to exceed ten 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
Certificateholder, by receiving and holding a 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 Certificateholders
hereunder, regardless of the source from which such information was obtained.
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SECTION 6.8 Authenticating Agent.
--------------------
(a) The Trustee may appoint one or more authenticating agents with respect
to the Certificates which shall be authorized to act on behalf of the Trustee in
authenticating the Certificates in connection with the issuance, delivery,
registration of transfer, exchange or repayment of the Certificates. Whenever
reference is made in this Agreement to the authentication of Certificates by the
Trustee or the Trustee's certificate of authentication, such reference shall be
deemed to include authentication on behalf of the Trustee by an authenticating
agent and a certificate of authentication executed on behalf of the Trustee by
an authenticating agent. Each authenticating agent must be acceptable to the
Seller.
(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 paper or any further act on the part of the Trustee
or such authenticating agent.
(c) An authenticating agent may at any time resign by giving written
notice of resignation to the Trustee and to the 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.
(d) The Trustee agrees to pay each authenticating agent from time to time
reasonable compensation for its services under this Section 6.8, and the Trustee
-----------
shall be entitled to be reimbursed and the Servicer shall reimburse the Trustee
for such reasonable payments actually made, subject to the provisions of Section
-------
11.5.
----
(e) The provisions of Sections 11.1, 11.2 and 11.3 shall be applicable to
------------- ---- ----
any authenticating agent.
(f) Pursuant to an appointment made under this Section 6.8, 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:
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This is one of the certificates described in the Pooling and Servicing
Agreement.
_____________________________
as Authenticating Agent
for the Trustee,
By: _____________________________
Authorized Officer
SECTION 6.9 Tender of Exchangeable Seller Certificate.
-----------------------------------------
(a) Upon any Exchange, the Trustee shall issue to the Holder of the
Exchangeable Seller Certificate under Section 6.1, for execution and redelivery
-----------
to the Trustee for authentication under Section 6.2, one or more new Series of
-----------
Investor Certificates. Any such Series of Investor Certificates shall be
substantially in the form specified in the related Supplement and shall bear,
upon its face, the designation for such Series to which it belongs so selected
by the Seller. Except as specified in any Supplement for a related Series, all
Investor Certificates of any Series shall be equally and ratably entitled as
provided herein to the benefits hereof (except that the Enhancement provided for
any Series shall not be available for any other Series) without preference,
priority or distinction on account of the actual time or times of authentication
and delivery, all in accordance with the terms and provisions of this Agreement
and the related Supplement.
(b) The Holder of the Exchangeable Seller Certificate may tender the
Exchangeable Seller Certificate to the Trustee in exchange for (i) one or more
newly issued Series of Investor Certificates and (ii) a reissued Exchangeable
Seller Certificate (any such tender, a "Seller Exchange"). In addition, to the
---------------
extent permitted for any Series of Investor Certificates as specified in the
related Supplement, the Seller may tender Investor Certificates of such Series
and the Holder of the Exchangeable Seller Certificate may tender the
Exchangeable Seller Certificate to the Trustee pursuant to the terms and
conditions set forth in such Supplement in exchange for (i) one or more newly
issued Series of Investor Certificates and (ii) a reissued Exchangeable Seller
Certificate (an "Investor Exchange"). The Seller Exchange and Investor Exchange
-----------------
are referred to collectively herein as an "Exchange." The Holder of the
--------
Exchangeable Seller Certificate may perform an Exchange by notifying the
Trustee, in writing at least three days in advance (an "Exchange Notice") of the
---------------
date upon which the Exchange is to occur (an "Exchange Date"). Any Exchange
-------------
Notice shall state the designation of any Series to be issued on the Exchange
Date and, with respect to each such Series: (a) its Initial Investor
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Interest (or the method for calculating such Initial Investor Interest), which
at any time, may not be greater than the current principal amount of the
Exchangeable Seller Certificate at such time (or in the case of an Investor
Exchange, the sum of the portion of the Investor Interest of the Series of
Investor Certificates to be exchanged plus the current principal amount of the
Exchangeable Seller Certificate), (b) its Certificate Rate (or the method for
allocating interest payments or other cash flow to such Series), if any, and (c)
the provider or providers of the Enhancement, if any, with respect to such
Series. On the Exchange Date, the Trustee shall only authenticate and deliver
any such Series of Investor Certificates upon delivery to it of the following:
(a) a Supplement satisfying the criteria set forth in subsection 6.9(c) executed
-----------------
by the Seller and specifying the Principal Terms of such Series, (b) the
applicable Enhancement, if any, (c) the agreement, if any, pursuant to which the
Enhancement Provider agrees to provide the Enhancement, if any, (d) an Opinion
of Counsel to the effect that, unless otherwise stated in the related
Supplement, the newly issued Series of Investor Certificates will be treated as
debt secured by the Receivables for Federal, New York and Connecticut income tax
purposes, that the issuance of the newly issued Series of Investor Certificates
will not adversely affect the Federal, New York and Connecticut income tax
characterization of the Holder of any outstanding Series of Investor
Certificates or any Certificate Owner or result in the trust being subject to
Federal, New York or Connecticut tax at the entity level, (e) written
confirmation from the Rating Agency that the Exchange will not result in the
Rating Agency's reducing or withdrawing its rating on any then outstanding
Series rated by it, (f) an Officer's Certificate signed by a Vice President (or
any more senior officer) of the Seller, that on the Exchange Date (i) the
Seller, after giving effect to such Exchange, would not be required to add
Additional Accounts pursuant to subsection 2.6(e) and (ii) after giving effect
-----------------
to such Exchange, the Seller Interest would be at least equal to the Minimum
Seller Interest, and (g) the existing Exchangeable Seller Certificate or
applicable Investor Certificates, as the case may be. Upon satisfaction of such
conditions, the Trustee shall cancel the existing Exchangeable Seller
Certificate or applicable Investor Certificates, as the case may be, and issue,
as provided above, such Series of Investor Certificates and a new Exchangeable
Seller Certificate, dated the Exchange Date. There is no limit to the number of
Exchanges that may be performed under this Agreement.
(c) In conjunction with an Exchange, the parties hereto shall execute a
Supplement, which shall specify the relevant terms with respect to any Series of
Investor Certificates, which may include without limitation: (i) its name or
designation, (ii) an Initial Investor Interest or the method of calculating
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the Initial Investor Interest, (iii) the Certificate Rate (or formula for the
determination thereof), (iv) the Closing Date, (v) the rating agency or agencies
rating such Series, (vi) the interest payment date or dates and the date or
dates from which interest shall accrue, including the Interest Accrual Period,
(vii) the name of the Clearing Agency, if any, (viii) the rights, if any, of the
Holder of the Exchangeable Seller Certificate that have been transferred to the
Holders of such Series pursuant to such Exchange (including any rights to
allocations of Collections of Finance Charge Receivables and Principal
Receivables), (ix) the method of allocating Collections with respect to
Principal Receivables for such Series and, if applicable, with respect to other
Series and the method by which the principal amount of Investor Certificates of
such Series shall amortize or accrete and the method for allocating Collections
with respect to Finance Charge Receivables and Receivables in Defaulted
Accounts, (x) the names of any accounts to be used by such Series and the terms
governing the operation of any such account, (xi) the Series Servicing Fee
Percentage, (xii) the Minimum Seller Interest, (xiii) the Minimum Aggregate
Principal Receivables, (xiv) the Series Termination Date, (xv) the terms or any
Enhancement with respect to such Series, (xvi) the Enhancement Provider, if
applicable, (xvii) the Base Rate applicable to such Series, (xviii) the
Repurchase Terms or the terms on which the Certificates of such Series may be
remarketed to other investors, (xix) any deposit into any account maintained for
the benefit of the Certificateholders of such Series, (xx) the number of Classes
of such Series, and if more than one Class, the rights and priorities of each
such Class, (xxi) the extent to which the Investor Certificates 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 certificate 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, (xxii) whether the Certificates may be issued
in bearer form and any limitations imposed thereon, (xxiii) whether Interchange
or other fees will be included in the funds available to be paid for such
Series, (xxiv) the priority of any Series with respect to any other Series,
(xxv) the Pool Factor, (xxvi) the Pool Amount and (xxvii) any other relevant
terms of such Series (all such terms, the "Principal Terms" of such Series). If
---------------
on the date of the issuance of such Series there is issued and outstanding one
or more Series of Investor Certificates and no Series of Investor Certificates
then outstanding is currently rated by a Rating Agency, then as a condition to
such Exchange a nationally recognized investment banking firm or commercial bank
shall also deliver to the Trustee an officer's certificate stating, in
substance, that the Exchange will not have an adverse effect on the timing or
distribution of payments to such other Series of Investor Certificates then
issued and outstanding.
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SECTION 6.10 Global Certificate; Euro-Certificate Exchange Date. If
--------------------------------------------------
specified in the related Supplement for any Series, the Investor Certificates
may be initially issued in the form of a single temporary Global Certificate
(the "Global Certificate") in bearer form, without interest coupons, in the
------------------
denomination of the Initial Investor Interest and substantially in the form
attached to the related Supplement. Unless otherwise specified in the related
Supplement, the provisions of this Section 6.10 shall apply to such Global
------------
Certificate. The Global Certificate will be 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 in the
manner described in the related Supplement for Registered and/or Bearer
Certificates in definitive form (the "Definitive Euro-Certificates").
----------------------------
SECTION 6.11 Book-Entry Certificates. Unless otherwise provided in any
-----------------------
related Supplement, the Investor Certificates, upon original issuance, shall be
issued in the form of typewritten Certificates representing the Book-Entry
Certificates, to be delivered to the depository specified in such Supplement
(the "Depository") which shall be the Clearing Agency, by or on behalf of such
----------
Series. The Investor Certificates of each Series shall unless otherwise
provided in the related Supplement initially be registered on the Certificate
Register in the name of the nominee of the Clearing Agency. No Certificate
Owner will receive a definitive certificate representing such Certificate
Owner's interest in the related Series of Investor Certificates, except as
provided in Section 6.13. Unless and until definitive, fully registered
------------
Investor Certificates of any Series ("Definitive Certificates") have been issued
-----------------------
to Certificate Owners pursuant to Section 6.13:
------------
(i) the provision of this Section 6.11 shall be in full force and
------------
effect with respect to each such Series;
(ii) the Seller, the Servicer, the Paying Agent, the Transfer Agent
and Registrar and the Trustee may deal with the Clearing Agency and the
Clearing Agency Participants for all purposes (including the making of
distributions on the Investor Certificates of each such Series) as the
authorized representatives of the Certificate Owners;
(iii) to the extent that the provisions of this Section 6.11 conflict
------------
with any other provisions of this Agreement, the provisions of this Section
-------
6.11 shall control with respect to each such Series; and
----
(iv) the rights of Certificate Owners of each such Series shall be
exercised only through the Clearing Agency and the applicable Clearing
Agency Participants and shall be
-85-
limited to those established by law and agreements between such Certificate
Owners and the Clearing Agency and/or the Clearing Agency Participants.
Pursuant to the Depository Agreement applicable to a Series, unless and
until Definitive Certificates of such Series are issued pursuant to Section
-------
6.13, the initial Clearing Agency will make book-entry transfers among the
----
Clearing Agency Participants and receive and transmit distributions of
principal and interest on the Investor Certificates to such Clearing Agency
Participants.
SECTION 6.12 Notices to Clearing Agency. Whenever notice or other
--------------------------
communication to the Certificateholders is required under this Agreement, unless
and until Definitive Certificates shall have been issued to Certificate Owners
pursuant to Section 6.13, the Trustee shall give all such notices and
------------
communications specified herein to be given to Holders of the Investor
Certificates to the Clearing Agency for distribution to Holders of Investor
Certificates.
SECTION 6.13 Definitive Certificates. If (i) (A) the Seller advises the
-----------------------
Trustee in writing that the Clearing Agency is no longer willing or able to
discharge properly its responsibilities under the applicable Depository
Agreement, and (B) the Trustee or the Seller is unable to locate a qualified
successor, (ii) the Seller, at its option, advises the Trustee in writing that
it elects to terminate the book-entry system through the Clearing Agency with
respect to any Series of Certificates or (iii) after the occurrence of a
Servicer Default, Certificate Owners of a Series representing beneficial
interests aggregating not less than 50% of the Investor Interest of such Series
advise the Trustee and the applicable Clearing Agency through the applicable
Clearing Agency Participants in writing that the continuation of a book-entry
system through the applicable Clearing Agency is no longer in the best interests
of the Certificate Owners, the Clearing Agency shall notify all Certificate
Owners of such Series, through the applicable Clearing Agency Participants, of
the occurrence of any such event and of the availability of Definitive
Certificates to Certificate Owners of such Series requesting the same. Upon
surrender to the Trustee of the Investor Certificates of such Series by the
applicable Clearing Agency, accompanied by written registration instructions
from the applicable Clearing Agency for registration, the Trustee shall issue
the Definitive Certificates of such Series. 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 Definitive Certificates of such Series all references
herein to obligations imposed upon or to be performed by the applicable Clearing
Agency shall be deemed to be imposed upon and performed by the Trustee, to the
extent
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applicable with respect to such Definitive Certificates, and the Trustee shall
recognize the Holders of the Definitive Certificates of such Series as
Certificateholders of such Series hereunder.
SECTION 6.14 Meetings of Certificateholders. To the extent provided by
------------------------------
the Supplement for any Series issued in whole or in part in Bearer Certificates,
the Servicer or the Trustee may at any time call a meeting of the
Certificateholders of such Series, to be held at such time and at such place as
the Servicer or the Trustee, as the case may be, shall determine, for the
purpose of approving a modification of or amendment to, or obtaining a waiver
of, any covenant or condition set forth in this Agreement with respect to such
Series or in the Certificates of such Series, subject to Section 13.1 of the
------------
Agreement.
[End of Article VI]
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ARTICLE VII
OTHER MATTERS RELATING TO THE SELLER
SECTION 7.1 Liability of the Seller. The Seller shall be liable in
-----------------------
accordance herewith to the extent of the obligations specifically undertaken by
the Seller.
SECTION 7.2 Merger or Consolidation of, or Assumption of the Obligation
-----------------------------------------------------------
of, the Seller.
--------------
(a) The Seller shall not consolidate with or merge into any other
corporation or convey or transfer its properties and assets substantially as an
entirety to any Person, unless:
(i) the corporation formed by such consolidation or into which the
Seller is merged or the Person which acquires by conveyance or transfers
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 laws of the United States of America or any State or the District of
Columbia, and shall be a state or national banking association that is not
subject to the Bankruptcy Code of 1978, as amended from time to time, or to
any successor statute, if the Seller is not the surviving entity, and shall
expressly assume, by an agreement supplemental hereto, executed and
delivered to the Trustee and the Enhancement Provider, to the extent so
provided in the applicable Supplement, in form satisfactory to the Trustee,
the performance of every covenant and obligation of the Seller, as
applicable hereunder and shall benefit from all the rights granted to the
Seller, as applicable hereunder (to the extent that any right, covenant or
obligation of the Seller, as applicable hereunder, is inapplicable to the
successor entity (because such successor entity is not a Connecticut
capital stock savings bank), such successor entity shall be subject to such
covenant or obligation, or benefit from such right, as would apply, to the
extent practicable, to such successor entity); and
(ii) the Seller has delivered to the Trustee and the Rating Agencies
an Officer's Certificate signed by a Vice President (or any more senior
officer) of the Seller stating that such consolidation, merger, conveyance
or transfer and such supplemental agreement comply with this Section 7.2
-----------
and that all conditions precedent herein provided for relating to such
transaction have been complied with and an Opinion of Counsel that such
supplemental agreement is legal, valid and binding.
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(b) The obligations of the Seller hereunder shall not be assignable nor
shall any Person succeed to the obligations of the Seller hereunder except (i)
for mergers, consolidations, assumptions or transfers in accordance with the
provisions of the foregoing paragraph or (ii) other sales, transfers, or pledges
including transfers of the Accounts, or other mergers, assumptions or
consolidations other than those permitted by subsection 7.2(a) (A) which the
-----------------
Seller and the Servicer determine will not be adverse to the Interests of the
Certificateholders of any Series, (B) which the Rating Agency has advised the
Seller and the Trustee in writing will not result in the reduction or withdrawal
of its then-existing rating of the Certificates of any Series then outstanding,
(C) 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, as applicable hereunder, and shall
benefit from all the rights granted to the Seller, as applicable hereunder, and
(D) for which the Enhancement Provider, if provided in the related Supplement,
has given its consent, which consent shall not be unreasonably withheld.
SECTION 7.3 Limitation on Liability of the Seller. Subject to Section
------------------------------------- -------
7.1, neither the Seller nor any of its directors, officers, employees or agents
shall be under any liability to the Trust, the Trustee, the Certificateholders
or any other Person for any action taken or for refraining from the taking of
any action pursuant to this Agreement whether arising from express or implied
duties under this Agreement; provided, however, that this provision shall not
-------- -------
protect the Seller or any such Person against any liability which would
otherwise be imposed by reason of willful misfeasance, bad faith or gross
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. The Seller and any director, officer,
employee or agent may rely in good faith on any document of any kind prima facie
----- -----
properly executed and submitted by any Person respecting any matters arising
hereunder.
[End of Article VII]
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ARTICLE VIII
OTHER MATTERS RELATING
TO THE SERVICER
SECTION 8.1 Liability of the Servicer. The Servicer shall be liable in
-------------------------
accordance herewith only to the extent of the obligations specifically
undertaken by the Servicer in such capacity herein.
SECTION 8.2 Merger or Consolidation of, or Assumption of the Obligations
------------------------------------------------------------
of, the Servicer.
----------------
(a) 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) the corporation formed by such consolidation or into which the
Servicer is merged or the Person which acquires by conveyance or transfers
the properties and assets of the Servicer substantially as an entirety
shall be a corporation organized and existing under the laws of the United
States of America or any State or the District of Columbia, and shall be a
state or national banking association that is not subject to the Bankruptcy
Code of 1978, as amended from time to time, or to any successor statute or
other entity which is not subject to the bankruptcy laws of the United
States of America and shall be an Eligible Servicer, and, if the Servicer
is not the surviving entity, shall expressly assume, by an agreement
supplemental hereto, executed and delivered to the Trustee and the
Enhancement Provider, to the extent so provided in the applicable
Supplement, in form satisfactory to the Trustee, the performance of every
covenant and obligation of the Servicer hereunder (to the extent that any
right, covenant or obligation of the Servicer, as applicable hereunder, is
inapplicable (because such successor entity is not a Connecticut capital
stock savings bank corporation) to the successor entity, such successor
entity shall be subject to such covenant or obligation, or benefit from
such right, as would apply, to the extent practicable, to such successor
entity); and
(ii) the Servicer has delivered to the Trustee and the Rating
Agencies (A) an Officer's Certificate stating that such consolidation,
merger, conveyance or transfer and such supplemental agreement comply with
this Section 8.2 and that all conditions precedent herein provided for
-----------
relating to such transaction have been complied with and (B) an Opinion of
Counsel that such supplemental agreement is legal, valid and binding.
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(b) the obligations or duties of the Servicer hereunder shall not be
assignable nor shall any Person succeed to the obligations of the Servicer
hereunder except for (i) mergers, consolidations, assumptions or transfers in
accordance with the foregoing paragraph; (ii) transfers pursuant to Section 8.5
-----------
and delegations pursuant to Section 8.7; (iii) the appointment of a Successor
-----------
Servicer pursuant to Section 10.2; and (iv) other sales, transfers, pledges or
------------
other mergers, assumptions or consolidations (A) which the Seller and the
Servicer determine will not be adverse to the interests of the
Certificateholders of any Series, (B) which the Rating Agency has advised the
Servicer and the Trustee in writing will not result in the reduction or
withdrawal of its then-existing rating of the Certificates of any Series then
outstanding, (C) 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 Servicer, as applicable to it hereunder,
and shall benefit from all rights granted to the Servicer, as applicable
hereunder and (D) for which the Enhancement Provider, if so provided in the
related Supplement has given its consent, which consent shall not be
unreasonably withheld.
SECTION 8.3 Limitation on Liability of the Servicer and Others. Except as
--------------------------------------------------
provided in Section 8.4 with respect to the Trust and the Trustee, neither the
-----------
Servicer nor any of its directors, officers, employees or agents shall be under
any liability to the Trust, the Trustee, the Certificateholders or any other
Person for any action taken or for refraining from the taking of any action 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 which would otherwise be imposed by reason of willful misfeasance, bad
faith or gross negligence in the performance of duties or by reason of its
reckless disregard of its 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 respecting any matters arising hereunder. The Servicer shall not be
under any obligation to appear in, prosecute or defend any legal action which is
not incidental to its duties to service the Receivables in accordance with this
Agreement which in its reasonable opinion may involve it in any expense or
liability.
SECTION 8.4 Servicer Indemnification of the Trust and the Trustee. The
-----------------------------------------------------
Servicer shall indemnify and hold harmless the Trust and the Trustee from and
against any reasonable loss, liability, expense, damage or injury suffered or
sustained by reason of any acts or omissions or alleged acts or omissions of
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the Servicer with respect to activities of the Trust or of the Trustee pursuant
to this Agreement, including, but not limited to any judgment, award,
settlement, reasonable attorneys' fees and other costs or expenses incurred in
connection with the defense of any actual or threatened action, proceeding or
claim; provided, however, that the Servicer shall not indemnify the Trustee for
-------- -------
any acts, omissions or alleged acts or omissions which constitute or are caused
by fraud, negligence, breach of fiduciary duty 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 incurred
as a result of Defaulted Accounts or Receivables which are written off as
uncollectible; 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 (except to the extent that such
liabilities, taxes or expenses arose as a result of the breach by the Servicer
of its obligations under Section 11.11). Any such indemnification shall not be
-------------
payable from the assets of the Trust. The provisions of this indemnity shall
run directly to and be enforceable by an injured party subject to the
limitations hereof. The obligations of the Servicer under this Section 8.4
-----------
shall survive the termination of the Trust and the resignation or removal of the
Trustee.
SECTION 8.5 Resignation of the Servicer. The Servicer shall not resign
---------------------------
from the obligations and duties hereby imposed on it except (a) upon
determination that (i) the performance of its duties hereunder is no longer
permissible under applicable law and (ii) there is no reasonable action which
the Servicer could take to make the performance of its duties hereunder
permissible under applicable law or (b) upon the assumption, by an agreement
supplemental hereto, executed and delivered to the Trustee, in form satisfactory
to the Trustee, of the obligations and duties of the Servicer hereunder by any
of its Affiliates that is a wholly owned subsidiary of People's Bank or any
other entity as to which (i) the Rating Agency has given written notice
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that such substitution will not result in a reduction or withdrawal of the then
existing ratings of the Investor Certificates then outstanding and (ii) the
Enhancement Provider, where applicable, has given its consent which consent
shall not be unreasonably withheld and, in either case, that qualifies as an
Eligible Servicer. Any determination permitting the resignation of the Servicer
shall be evidenced as to clause (a) above by an Opinion of Counsel to such
----------
effect delivered to the 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 10.2 hereof. If within
------------
120 days of the date of the determination that the Servicer may no longer act as
Servicer hereunder under clause (a) above the Trustee is unable to appoint a
----------
Successor Servicer, the Trustee shall serve as Successor Servicer hereunder.
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 qualifying as an Eligible Servicer as the Successor Servicer
hereunder. The Trustee shall give prompt notice to the Rating Agency and the
Enhancement Provider, if so provided in the related Supplement upon the
appointment of a Successor Servicer.
SECTION 8.6 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 the
Investor Certificateholders, or by applicable statutes or regulations to review
such documentation, such access being afforded without charge but only (i) upon
reasonable request, (ii) during normal business hours, (iii) subject to the
Servicer's normal security and confidentiality procedures and (iv) at offices
designated by the Servicer. Nothing in this Section 8.6 shall derogate from the
-----------
obligation of the Seller, the Trustee or 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 8.6 as a result of
-----------
such obligations shall not constitute a breach of this Section 8.6.
-----------
SECTION 8.7 Delegation of Duties. It is understood and agreed by the
--------------------
parties hereto that the Servicer may delegate certain of its duties hereunder to
any Affiliate of People's Bank. 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. Any such
delegations 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 8.5 hereof. If any such delegation is to a party other than
-----------
an
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Affiliate of People's Bank, notification thereof shall be given to the Rating
Agency.
SECTION 8.8 Examination of Records. The Servicer shall clearly and
----------------------
unambiguously identify each Account (including any Additional Account or
Automatic Additional Account designated pursuant to Section 2.6) in its computer
-----------
or other records to reflect that the Receivables arising in such Account have
been conveyed to the Trust pursuant to this Agreement. 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.
[End of Article VIII]
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ARTICLE IX
PAY OUT EVENTS
SECTION 9.1 Pay Out Events. If any one of the following events shall
--------------
occur:
(a) the Seller shall consent to the appointment of a conservator,
receiver or liquidator in any insolvency, readjustment of debt, marshalling
of assets and liabilities or similar proceedings of or relating to all or
substantially all of its property, or a decree or order of a court or
agency or supervisory authority having jurisdiction in the premises for the
appointment of a conservator or receiver or liquidator in any insolvency,
readjustment of debt, marshalling of assets and liabilities or similar
proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against the Seller; or the Seller shall admit in writing
its inability to pay its debts generally as they become due, file a
petition to take advantage of any applicable insolvency or reorganization
statute, make an assignment for the benefit of its creditors or voluntarily
suspend payment of its obligations; or the Seller shall become unable for
any reason to transfer Receivables to the Trust in accordance with the
provisions of this Agreement; or
(b) the Trust shall become subject to regulation by the Securities
and Exchange Commission as an "investment company" within the meaning of
the Investment Company Act;
then a Pay Out Event with respect to all Series of Certificates (each, a "Trust
-----
Pay Out Event") shall occur without any notice or other action on the part of
-------------
the Trustee or the Investor Certificateholders immediately upon the occurrence
of such event and notice of such Trust Pay Out Event shall be sent by the
Servicer to the Rating Agencies.
SECTION 9.2 Additional Rights Upon the Occurrence of Certain Events.
-------------------------------------------------------
(a) If the Seller shall consent to the appointment of a conservator,
receiver or liquidator for the winding-up or liquidation of its affairs, or a
decree or order of a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of a conservator or receiver or
liquidator for the winding-up or liquidation of its affairs shall have been
entered against the Seller (an "Insolvency Event"), the Seller shall on the day
----------------
of such Insolvency Event (the "Appointment Day") immediately cease to transfer
---------------
Principal Receivables to the Trust and shall promptly give notice to the
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Trustee of such appointment or voluntary liquidation. Notwithstanding any
cessation of the transfer to the Trust of additional Principal Receivables,
Finance Charge Receivables, whenever created, accrued in respect of Principal
Receivables which have been transferred to the Trust shall continue to be a part
of the Trust, and Collections with respect thereto shall continue to be
allocated and paid in accordance with Article IV. Within 15 days of the
----------
Appointment Day, the Trustee shall (i) publish a notice in an Authorized
Newspaper that an Insolvency Event has occurred and that the Trustee intends to
sell, dispose of or otherwise liquidate the Receivables in a commercially
reasonable manner and (ii) send written notice to the Investor
Certificateholders describing the provisions of this Section 9.2 and requesting
-----------
instructions from such Holders. Unless within 90 days from the day notice
pursuant to clause (i) above is first published (the "Publication Date"), the
---------- ----------------
Trustee shall have received written instructions of Holders of Investor
Certificates representing Undivided Interests aggregating in excess of 50% of
the related Invested Amount of each Series (or in the case of a Series having
more than one Class, each Class of such Series) to the effect that the Trustee
shall not instruct the Servicer to sell, dispose of, or otherwise liquidate the
Receivables, the Trustee shall instruct the Servicer to proceed to sell, dispose
of, or otherwise liquidate the portion of Receivables allocable to any Series
that did not vote to disapprove of the liquidation of the Receivables in
accordance with this Agreement in a commercially reasonable manner and on
commercially reasonable terms, which shall include the solicitation of
competitive bids and the Servicer shall proceed to consummate the sale,
liquidation or disposition of the Receivables allocable to any outstanding
Series, unless the holders of more than 50% of the principal amount of each
Class of such Series instruct the Trustee not to sell the portion of the
Receivables allocable to such Series, in which case the Trust shall continue
with respect to such Series pursuant to the terms of the Agreement and the
Supplement. The portion of the Receivables allocable to any Series shall be
equal to the sum of (1) the product of (A) the Seller Percentage, (B) the
aggregate outstanding Principal Receivables and (C) a fraction the numerator of
which is the related Investor Percentage of Collections of Finance Charge
Receivables and the denominator of which is the sum of all Investor Percentages
with respect to Collections of Finance Charge Receivables for all Series
outstanding and (2) the Investor Interest of such Series. The Seller or any of
its Affiliates shall be permitted to bid for the Receivables. In addition, the
Seller or any of its Affiliates shall have the right to match any bid by a third
person and be granted the right to purchase the Receivables at such matched bid
price. The Trustee may obtain a prior determination from any such bankruptcy
trustee, receiver or liquidator that the terms and manner of any proposed sale,
disposition or liquidation are
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commercially reasonable. The provisions of Sections 9.1 and 9.2 shall not be
------------ ---
deemed to be mutually exclusive.
(b) The proceeds from the sale, disposition or liquidation of the
Receivables pursuant to subsection (a) above shall be treated as Collections on
--------------
the Receivables and shall be allocated and deposited in accordance with the
provisions of Article IV; provided, however that the proceeds for any such sale,
---------- -------- -------
disposition or liquidation of Receivables with respect to a Series but not all
of the outstanding Series shall be applied solely to make payments to such
Series; provided, further that the Trustee shall determine conclusively the
-------- -------
amount of such proceeds which are allocable to Finance Charge Receivables and
the amount of such proceeds which are allocable to Principal Receivables. On
the day following the last Distribution Date in the Monthly Period during which
such proceeds are distributed to the Investor Certificateholders of each Series,
the Trust shall terminate.
[End of Article IX]
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ARTICLE X
SERVICER DEFAULTS
SECTION 10.1 Servicer Defaults. If any one of the following events (a
-----------------
"Servicer Default") shall occur and be continuing:
-----------------
(a) any failure by the Servicer to make any payment, transfer or
deposit or to give instructions or notice to the Trustee pursuant to
Article IV or to instruct the Trustee to make any required drawing,
----------
withdrawal, or payment under any Enhancement on or before the date
occurring five Business Days after the date such payment, transfer, deposit
withdrawal or drawing or such instruction or notice is required to be made
or given, as the case may be, under the terms of this Agreement;
(b) failure on the part of the Servicer duly to observe or perform in
any respect any other covenants or agreements of the Servicer set forth in
this Agreement, which has a material adverse effect on the
Certificateholders of any Series (which determination shall be made without
regard to whether funds are available to the Certificateholders of any
Series under any applicable Enhancement) and which continues unremedied for
a period of 60 days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to the Servicer by
the Trustee, or to the Servicer and the Trustee by (i) the Holders of
Investor Certificates evidencing Undivided Interests aggregating not less
than 50% of the Investor Interest of any Series adversely affected thereby
or (ii) to the extent provided in any Supplement by the related Enhancement
Provider, and continues to materially adversely affect such Investor
Certificateholders for such period; or the Servicer shall delegate its
duties under this Agreement, except as permitted by Section 8.7;
-----------
(c) any representation, warranty or certification made by the
Servicer in this Agreement or in any certificate delivered pursuant to this
Agreement shall prove to have been incorrect when made, which has a
material adverse effect on the Certificateholders of any Series (which
determination shall be made without regard to whether funds are available
to the Certificateholders of any Series under any applicable Enhancement)
and which 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 (i) the Holders of Investor
Certificates
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evidencing Undivided Interests aggregating not less than 50% of the
Investor Interest of any Series adversely affected thereby or (ii) to the
extent provided in any Supplement by the related Enhancement Provider, and
continues to materially adversely affect such Investor Certificateholders
for such period; or
(d) the Servicer shall consent to the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshalling
of assets and liabilities or similar proceedings of or relating to the
Servicer or of or relating to all or substantially all of its property, or
a decree or order of a court or agency or supervisory authority having
jurisdiction in the premises for the appointment of a conservator or
receiver or liquidator in any insolvency, readjustment of debt, marshalling
of assets and liabilities or similar proceedings, or for the winding-up or
liquidation of its affairs, shall have been entered against the Servicer,
and such decree or order shall have remained in force undischarged or
unstayed for a period of 60 days; or the Servicer shall admit in writing
its inability to pay its debts generally as they become due, file a
petition to take advantage of any applicable insolvency or reorganization
statute, make any assignment for the benefit of its creditors or
voluntarily suspend payment of its obligations; then, so long as such
Servicer Default shall not have been remedied, either the Trustee, or the
Holders of Investor Certificates evidencing Undivided Interests aggregating
more than 50% of the Aggregate Investor Interest, by notice then given in
writing to the Servicer (and to the Trustee if given by the Investor
Certificateholders) (a "Termination Notice"), may terminate all of the
------------------
rights and obligations of the Servicer as Servicer under this Agreement.
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 10.2, all authority and power of the Servicer under this
------------
Agreement shall pass to and be vested in a 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 and obligations. The Servicer agrees to cooperate with
the Trustee and such Successor Servicer in effecting the termination of the
responsibilities and rights of the Servicer to conduct servicing hereunder
including, without limitation, the
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transfer to such 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 which shall on the
date of transfer be held by the Servicer for deposit, or which have been
deposited by the Servicer, in the Collection Account, the Excess Funding
Account, and any Series Account, or which shall thereafter be received with
respect to the Receivables, and in assisting the Successor Servicer and in
enforcing all rights to Recoveries and Interchange allocable to the Trust.
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 10.1 shall require the Servicer to
------------
disclose to the Successor Servicer information of any kind which 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.
Subject to the immediately preceding sentence, the Servicer agrees to grant
to the Successor Servicer an exclusive, non-transferrable, non-assignable
license to utilize the software which is owned by the Servicer and which is
used by the Servicer in connection with the servicing of the Accounts and
the Receivables; provided, however, that such software shall be used by the
-------- -------
Successor Servicer solely for the purposes of servicing the Accounts and
the Receivables. The Servicer shall, on the date of any servicing
transfer, transfer all of its rights and obligations under the Enhancement
with respect to any Series to the Successor Servicer.
SECTION 10.2 Trustee to Act; Appointment of Successor.
----------------------------------------
(a) On and after the receipt by the Servicer of a Termination Notice
pursuant to Section 10.1, the Servicer shall continue to perform all servicing
------------
functions under this Agreement until the date specified in the Termination
Notice or otherwise specified by the Trustee in writing or, if no such date is
specified in such Termination Notice, or otherwise specified by the Trustee,
until a date mutually agreed upon by the Servicer and Trustee. The Trustee
shall notify the Rating Agency of such removal of the Servicer. The Trustee
shall, as promptly as possible after the giving of a Termination Notice appoint
an Eligible Servicer as successor servicer (the "Successor Servicer"), and such
------------------
Successor Servicer shall accept its
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appointment by a written assumption in a form acceptable to the Trustee. The
Trustee may obtain bids from any potential successor servicer. If the Trustee
is unable to obtain any bids from any potential successor servicer and the
Servicer delivers an Officer's Certificate to the effect that they cannot in
good faith cure the Servicer Default which gave rise to a transfer of servicing,
and if the Trustee is legally unable to act as Successor Servicer then the
Trustee shall offer the Servicer, for so long as People's Bank is the Servicer,
the right to accept reassignment of all of the Receivables and the Seller may
accept reassignment of all the Receivables on a date designated by the Seller
(the "Reassignment Date"); provided, however, that if the short-term deposits or
----------------- -------- -------
long-term unsecured debt obligations of the Seller are not rated at the time of
such purchase at least P-3 or Baa-3, respectively, by Xxxxx'x, no such purchase
by the Seller shall occur unless the Seller shall deliver an Opinion of Counsel
reasonably acceptable to the Trustee that such purchase would not constitute a
fraudulent conveyance of the Seller. The reassignment deposit amount with
respect to each Series for such reassignment shall be equal to the sum of (A)
the higher of (x) the sum of (i) the Investor Interest of such Series as of the
end of the Monthly Period preceding the Reassignment Date less the amount, if
any, previously accumulated for the payment of principal with respect to such
Series as provided in the related Supplement on the related Transfer Date
following the date of such reassignment, plus (ii) an amount equal to all
interest accrued but unpaid on the Investor Certificates less the amount, if
any, accumulated to pay interest with respect to such Series as provided in the
related Supplement on the Transfer Date following the date of such reassignment,
accrued at the applicable Certificate Rate through the date of reassignment and
(y) the average bid price quoted by two recognized dealers for a security
similar to the Investor Certificates of each such Series and rated in the
highest rating category by the Rating Agency and having a remaining maturity
approximately equal to the remaining maturity of such Series and (B) if, as
provided in the related Supplement, certain unpaid amounts to the Enhancement
Provider with respect to such Series. The reassignment deposit amount with
respect to each Series shall be deposited in the Collection Subaccount or any
Series Account, as provided in the related Supplement, for distribution to the
Investor Certificateholders of such Series pursuant to Section 12.3 of the
------------
Agreement. Any payment with respect to the Enhancement Provider of any Series
shall be made in the manner provided in the Supplement with respect to such
Series. 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 agent in accordance with the provisions of subsection 3.1(b).
-----------------
Notwithstanding the above, the
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Trustee shall, if it is legally unable so to act, petition a court of competent
jurisdiction to appoint any established financial institution having a net worth
of not less than $50,000,000 and whose regular business includes the servicer of
VISA or MasterCard credit card receivables as the Successor Servicer hereunder.
(b) Upon its appointment, the Successor Servicer shall be the successor in
all respects to the Servicer with respect to servicing functions under this
Agreement and shall be subject to all the responsibilities, duties and
liabilities relating thereto placed on the Servicer by the terms and provisions
hereof, and all references in this Agreement to the Servicer shall be deemed to
refer to the Successor Servicer; provided, however, that the references to
-------- -------
Servicer contained in Sections 8.4 and 11.5 shall be deemed to refer to the
------------ ----
Servicer with respect to responsibilities, duties and liabilities arising during
or with respect to such time that the Servicer was Servicer under this Agreement
and shall be deemed to refer to the Successor Servicer with respect to
responsibilities, duties and liabilities arising during or with respect to such
time that the Successor Servicer acts as Servicer under this Agreement. Any
Successor Servicer, by its acceptance of its appointment, will automatically
agree to be bound by the terms and provisions of each Enhancement.
(c) In connection with such appointment and assumption, the Trustee shall
be entitled to such compensation, or may make such arrangements for the
compensation of the Successor Servicer out of Collections, as it and such
Successor Servicer shall agree; provided, however, that no such compensation
-------- -------
shall be in excess of the Monthly Servicing Fee permitted to the Servicer
pursuant to Section 3.2. The Seller agrees that if the Servicer is terminated
-----------
hereunder, it will agree, at the request of the Trustee or any Successor
Servicer, to deposit a portion of the Collections in respect of Finance Charge
Receivables that it is entitled to receive pursuant to Article IV to pay its
----------
share 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 12.1 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
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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 10.2 shall require the Successor Servicer to
------------
disclose to the Seller information of any kind which 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.
SECTION 10.3 Notification to Certificateholders. Within three Business
----------------------------------
Days after the Servicer becomes aware of any Servicer Default, the Servicer
shall give prompt written notice thereof to the Trustee and the Trustee shall
give notice to the Investor Certificateholders (other than Bearer
Certificateholders) at their respective addresses appearing in the Certificate
Register. Upon any termination or appointment of a Successor Servicer pursuant
to this Article X, the Trustee shall give prompt written notice thereof to
---------
Investor Certificateholders (other than Bearer Certificateholders) at their
respective addresses appearing in the Certificate Register.
SECTION 10.4 Waiver of Past Defaults. The Holders of Investor
-----------------------
Certificates evidencing Undivided Interests aggregating not less than 50% of the
Investor Interest of each Series adversely affected by any default by the
Servicer may, on behalf of all Holders of Certificates of such Series, waive any
default by the Servicer or Seller in the performance of its obligations
hereunder and its consequences, except a default in the failure to make any
required deposits or payments of interest or principal relating to such Series
pursuant to Article IV which default does not result from the failure of the
----------
Paying Agent to perform its obligations to make any required deposits or
payments of interest and principal in accordance with Article IV. 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 to every purpose of this
Agreement and the Rating Agencies shall be sent notice of any such waiver. No
such waiver shall extend to any subsequent or other default or impair any right
consequent thereon except to the extent expressly so waived.
[End of Article X]
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ARTICLE XI
THE TRUSTEE
SECTION 11.1 Duties of Trustee.
-----------------
(a) The Trustee, prior to the occurrence of any Servicer Default of which
a Responsible Officer of the Trustee has actual knowledge and after the curing
of all Servicer Defaults which may have occurred, undertakes to perform such
duties and only such duties as are specifically set forth in this Agreement. If
a Servicer Default of which a Responsible Officer of the Trustee has actual
knowledge 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 which are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
substantially conform to the requirements of this Agreement. The Trustee shall
give prompt written notice to any Enhancement Provider affected thereby and the
Certificateholders (or, in the case of the Holders of Bearer Certificates,
notice by publication in the manner described in the related Supplement) of any
material lack of conformity of any such instrument to the applicable
requirements of this Agreement discovered by the Trustee which would entitle
such Enhancement Provider or a specified percentage of the Certificateholders,
as the case may be, to take any action pursuant to this Agreement.
(c) Subject to subsection 11.1(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 willful misconduct; provided,
--------
however, that:
-------
(i) the Trustee shall not be personally liable for an error of
judgment made in good faith, 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
evidencing Undivided Interests aggregating more than 50% of the Investor
Interest
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of any Series 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;
(iii) the Trustee shall not be charged with knowledge of any failure
by the Servicer referred to in clauses (a) and (b) of Section 10.1 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 Enhancement Provider or any Holders of Investor Certificates evidencing
Undivided Interests aggregating not less than 10% of the Investor Interest
of any Series adversely affected thereby; and
(iv) in the event that the Trustee is acting as Successor Servicer,
its liability as Servicer shall be limited as specified in Section 8.3.
-----------
(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, 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) Except for actions expressly authorized by this Agreement, the Trustee
shall take no action reasonably likely to impair the interests of the Trust in
any Receivable now existing or hereafter created or to impair the value of any
Receivable now existing or hereafter created.
(f) Except as provided in this subsection 11.1(f), the Trustee shall have
------------------
no power to vary the corpus of the Trust including, without limitation, the
power to (i) accept any substitute obligation for a Receivable initially
assigned to the Trust under Section 2.1 or 2.6 hereof, (ii) add any other
----------- ---
investment, obligation or security to the Trust, except for an addition
permitted under Section 2.6 or (iii) withdraw from the Trust any Receivables,
-----------
except for withdrawal permitted under Section 2.7, 9.2, 10.2, 12.1 or 12.2 or
----------- --- ---- ---- ----
subsection 2.4(d) or 2.4(e) or Article IV.
----------------- ------ ----------
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(g) 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 promptly upon a Responsible Officer's obtaining actual knowledge
thereof to perform such obligation, duty or agreement in the manner so required.
(h) If the Seller has agreed to transfer any of its credit card
receivables (other than the Receivables) to another Person, upon the written
request of the Seller, the Trustee will enter into such intercreditor agreements
(which shall be in form and substance satisfactory to the Trustee) with the
transferee of such receivables as are customary and necessary to separately
identify the rights, if any, of the Trustee, the Trust and such other Person in
the Seller's credit card receivables; provided that the Trustee, on behalf of
--------
the Trust, shall not enter into any intercreditor agreement which could
adversely affect the interests of the Certificateholders, any Enhancement
Provider or the Trustee 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.
SECTION 11.2 Certain Matters Affecting the Trustee. Except as otherwise
-------------------------------------
provided in Section 11.1:
------------
(a) the Trustee may conclusively 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 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 Opinion of Counsel
or written advice 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 Opinion of Counsel or
written advice 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, or to
institute, conduct or defend any litigation hereunder or in relation
hereto, at the request, order or direction of any of the
Certificateholders, pursuant to the provisions of this Agreement, unless
such Certificateholders shall have offered
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to the Trustee reasonable security or indemnity against the costs, expenses
and liabilities which may be incurred therein or thereby; nothing contained
herein shall, however, relieve the Trustee of the obligations, upon the
occurrence of any Servicer Default of which a Responsible Officer has
actual knowledge (which has not been cured), to exercise such of the rights
and powers vested in it by this Agreement or any Enhancement, 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 his 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 so to do by
(i) any Enhancement Provider who, or (ii) Holders of Investor Certificates
evidencing Undivided Interests aggregating more than 50% of the Investor
Interest of any Series which, could be adversely affected if the Trustee
does not perform such acts; provided, however, that the Enhancement
-------- -------
Provider shall reimburse the Trustee for any reasonable out-of-pocket
expenses resulting from any such investigation requested by it;
(f) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents,
nominees, custodians or attorneys, and the Trustee shall not be responsible
for any misconduct or negligence on the part of any such agent, nominee,
custodian or attorney appointed with due care by it hereunder; and
(g) except as may be required by subsection 11.1(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 or the Servicer with its respective
representations and warranties or for any other purpose.
SECTION 11.3 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
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Certificates). Except as set forth in Section 11.15, the Trustee makes no
-------------
representations as to the validity or sufficiency of this Agreement or of the
Certificates (other than the certificates 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 in respect of the Receivables or deposited in or withdrawn from
the Collection Account, the Excess Funding Account, or any Series Account by the
Servicer.
SECTION 11.4 Trustee May Own Certificates. 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.
SECTION 11.5 The Servicer to Pay Trustee's Fees and Expenses. The
-----------------------------------------------
Servicer covenants and agrees to pay 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, the Excess Funding
Account, any Series Account or otherwise) upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any of the provisions of this Agreement (including the
reasonable fees and expenses of its agents, any co-Trustees and counsel) except
any such expense, disbursement or advance as may arise from its own negligence
or bad faith and except as provided in the following sentence. If the Trustee
is appointed Successor Servicer pursuant to Section 10.2, the provisions of this
------------
Section 11.5 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 this Section 11.5 shall survive
------------
the termination of the Trust and the resignation or removal of the Trustee.
SECTION 11.6 Eligibility Requirements for Trustee. The Trustee hereunder
------------------------------------
shall at all times be 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 rated at least Baa-3. If such corporation publishes reports of
condition at least annually,
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pursuant to law or to the requirements of the aforesaid supervising or examining
authority, then for the purpose of this Section 11.6, the combined capital and
------------
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. In
case at any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section 11.6, the Trustee shall resign immediately in the
------------
manner and with the effect specified in Section 11.7.
------------
SECTION 11.7 Resignation or Removal of Trustee.
---------------------------------
(a) The Trustee may at any time resign and be discharged from the Trust
hereby created by giving written notice thereof to the Servicer with a copy to
the Enhancement Provider. Upon receiving such notice of resignation, the
Servicer 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, subject to the consent of the
Enhancement Provider of any Series (if the Supplement relating to such Series so
requires) which shall not be unreasonably withheld. In addition, the Servicer
shall notify the Rating Agency of the removal or discharge of the 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 11.6 hereof and shall fail to resign after
------------
written request therefor by 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, then the
Seller may 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 11.7 shall
------------
not become effective until acceptance of appointment by the successor trustee as
provided in Section 11.8 hereof and any liability of the Trustee arising
------------
hereunder shall survive such appointment of a successor trustee. Notice of any
action under this Section 11.7 shall be sent to the Rating Agencies.
------------
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SECTION 11.8 Successor Trustee.
-----------------
(a) Any successor trustee appointed as provided in Section 11.7 hereof
------------
shall execute, acknowledge and deliver to the Seller 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 11.8 unless at the time of such acceptance such successor trustee shall
------------
be eligible under the provisions of Section 11.6 hereof.
------------
(c) Upon acceptance of appointment by a successor trustee as provided in
this Section 11.8, such successor trustee shall mail notice of such succession
------------
hereunder to all Certificateholders at their addresses as shown in the
Certificate Register. Notice to Bearer Certificateholders shall be given in the
manner provided in the related Supplement.
SECTION 11.9 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 11.6
------------
hereof, without the execution or filing of any paper or any further act on the
part of any of the parties hereto, anything herein to the contrary
notwithstanding.
SECTION 11.10 Appointment of Co-Trustee or Separate Trustee.
---------------------------------------------
(a) Notwithstanding any other provisions of this Agreement, at any time,
for the purpose of meeting any legal requirements of any jurisdiction in which
any part of the Trust may at the time be located, the Trustee shall have the
power and may execute and deliver all instruments to appoint one or more Persons
to act as a co-trustee or co-trustees, or separate trustee or separate trustees,
or all or any part of the Trust, and to vest in such
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Person or Persons, in such capacity and for the benefit of the
Certificateholders, such title to the trust, or any part thereof, and, subject
to the other provisions of this Section 11.10, such powers, duties, obligations,
-------------
rights and trusts as the Trustee may consider necessary or desirable. No co-
trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under Section 11.6 and no notice to
------------
Certificateholders of the appointment of any co-trustee or separate trustee
shall be required under Section 11.8 hereof.
------------
(b) Every separate trustee and co-trustee shall, to the extent permitted
by law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or imposed
upon the Trustee shall be conferred or imposed upon and exercised or
performed by the Trustee and such separate trustee or co-trustee jointly
(it being understood that such separate trustee or co-trustee is not
authorized to act separately without the Trustee joining in such act),
except to the extent that under any 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 co-trustees,
as effectively as if given to each of them. Every instrument appointing any
separate trustee or co-trustee shall refer to this Agreement and the conditions
of this Article XI. Each separate trustee and co-trustee, upon its acceptance
----------
of the trusts conferred, shall be vested with the estates or property specified
in its instrument of appointment, either jointly with the Trustee or separately,
as may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording
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protection to, the Trustee. Every such instrument shall be filed with the
Trustee and a copy thereof given to the Servicer.
(d) Any separate trustee or co-trustee may at any time constitute the
Trustee, its agent or attorney-in-fact with full power and authority, to the
extent not prohibited by law, to do any lawful act under or in respect of this
Agreement on its behalf and in its name. If any separate trustee or co-trustee
shall die, become incapable of acting, resign or be removed, all 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.
SECTION 11.11 Tax Returns. In the event the Trust shall be required to
-----------
file tax returns, the Servicer, as soon as practicable after it is made aware of
such requirement, shall prepare or cause to be prepared any tax returns required
to be filed by the Trust and, to the extent possible, shall remit such returns
to the Trustee for a signature at least five days before such returns are due to
be filed. The Servicer shall prepare or shall cause to be prepared all tax
information required by law to be distributed to Certificateholders and shall
deliver such information to the Trustee at least five days prior to the date it
is required by law to be distributed to Certificateholders. The Trustee, upon
request, will furnish the Servicer with all such information known to the
Trustee as may be reasonably required in connection with the preparation of all
tax returns of the Trust and shall, upon request, execute such returns. In no
event shall the Trustee or the Servicer be liable for any liabilities, costs or
expenses of the Trust, the Investor Certificateholders or the Certificate Owners
arising under any tax law, including without limitation federal, state, local or
foreign income or excise taxes or any other tax imposed on or measured by income
(or any interest or penalty with respect thereto or arising from a failure to
comply therewith).
SECTION 11.12 Trustee May Enforce Claims Without Possession of
------------------------------------------------
Certificates. All rights of action and claims under this Agreement or any
------------
Series of 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 any Series of Certificateholders in respect of which such
judgment has been obtained.
SECTION 11.13 Suits for Enforcement. If a Servicer Default shall occur
---------------------
and be continuing, the Trustee, in its discretion
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may, subject to the provisions of Section 10.1, proceed to protect and enforce
------------
its rights and the rights of any Series of 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 any Series of Certificateholders.
SECTION 11.14 Rights of Certificateholders to Direct Trustee. Holders of
----------------------------------------------
Investor Certificates evidencing Undivided Interests evidencing more than 50% of
the Aggregate Investor Interest (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; provided, however, that, subject to
-------- -------
Section 11.1, 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 which
is not inconsistent with such direction of such Holders of Investor
Certificates.
SECTION 11.15 Representations and Warranties of Trustee. The Trustee
-----------------------------------------
represents and warrants 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 and authority to execute, deliver and
perform this Agreement, and has taken all necessary action to authorize the
execution, delivery and performance by it of this Agreement; and
(c) this Agreement has been duly executed and delivered by the Trustee.
SECTION 11.16 Maintenance of Office or Agency. The Trustee will maintain
-------------------------------
at its expense in the Borough of Manhattan, the
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City of New York, an office or offices or agency or agencies where notices and
demands to or upon the Trustee in respect of the Certificates and this Agreement
may be served. The Trustee initially appoints its Corporate Trust Office as its
office for such purposes in New York. The Trustee will give prompt written
notice to the Servicer, each Enhancement Provider and to Certificateholders (or
in the case of Bearer Certificates, in the manner provided in the related
Supplement) of any change in the location of the Certificate Register or any
such office or agency.
[End of Article XI]
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ARTICLE XII
TERMINATION
SECTION 12.1 Termination of Trust.
--------------------
(a) 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 Certificateholders as hereafter set forth) shall
terminate, except with respect to the duties described in Section 11.5 and
------------
subsection 12.3(b), on the Trust Termination Date; provided, however, that the
------------------ -------- -------
Trust shall not terminate on the date specified in clause (i) of the definition
of "Trust Termination Date" if each of the Servicer and the Holder of the
Exchangeable Seller Certificate notify the Trustee in writing, not later than
five Business Days preceding such date, that they desire that the Trust not
terminate on such date, which notice (such notice, a "Trust Extension") shall
---------------
specify the date on which the Trust shall terminate (such date, the "Extended
--------
Trust Termination Date"); provided, however, that the Extended Trust Termination
---------------------- -------- -------
Date shall be not later than the expiration of 21 years from the death of the
last survivor of the descendants of Xxxxxx X. Xxxxxxx, the father of the late
President of the United States, living on the date of the Agreement. The
Servicer and the Holder of the Seller Certificate may, on any date following the
Trust Extension, so long as no Series of Certificates is outstanding, deliver a
notice in writing to the Trustee changing the Extended Trust Termination Date.
(b) In the event that (i) the Trust has not terminated by the last
Distribution Date occurring in the second month preceding the Trust Termination
Date, and (ii) the Investor Interest of any Series (after giving effect to all
transfers, withdrawals, deposits and drawings to occur on such date and the
payment of principal on any Series of Certificates to be made on the related
Distribution Date during such month pursuant to Article IV) would be greater
----------
than zero, the Servicer shall sell within 30 days after such Transfer Date all
the Receivables. The Seller shall have the right of first refusal to purchase
the Receivables on terms equivalent to the best purchase offer as determined by
the Trustee. The proceeds of any such sale shall be treated as Collections on
the Receivables and shall be allocated and deposited in accordance with Article
-------
IV; provided, however, that the Trustee shall determine conclusively the amount
-- -------- -------
of such proceeds which are allocable to Finance Charge Receivables and the
amount of such proceeds which are allocable to Principal Receivables. During
such period, the Servicer shall continue to collect payments on the Receivables
and allocate and deposit such payments in accordance with the provisions of
Article IV.
----------
-115-
SECTION 12.2 Optional Purchase and Final Termination of Investor
---------------------------------------------------
Certificates of any Series.
--------------------------
(a) If so provided in any Supplement, the Seller may, but shall not be
obligated to, cause a final distribution to be made in respect of the related
Series of Certificates on a Distribution Date specified in such Supplement by
depositing into the Collection Account or the applicable Series Account, not
later than the Transfer Date preceding such Distribution Date, for application
in accordance with Article IV, the amount specified in such Supplement;
----------
provided, however, that if the short-term deposits or long-term unsecured debt
-------- -------
obligations of the Seller are not rated at the time of such purchase of
Receivables at least P-3 or Baa-3, respectively, by Xxxxx'x, no such event shall
occur unless the Seller shall deliver an Opinion of Counsel reasonably
acceptable to the Trustee that such deposit into the Collection Account or any
Series Account as provided in the related Supplement would not constitute a
fraudulent conveyance of the Seller.
(b) The amount deposited pursuant to subsection 12.2(a) shall be paid to
------------------
the Investor Certificateholders of the related Series (and the Enhancement
Provider if so provided in the related Supplement) pursuant to Article IV on the
----------
related Distribution Date following the date of such deposit. All Certificates
of a Series which are purchased by the Seller pursuant to subsection 12.2(a)
------------------
shall be delivered by the Seller upon such purchase to, and be cancelled by, the
Transfer Agent and Registrar and be disposed of in a manner satisfactory to the
Trustee and the Seller. The Investor Interest of each Series which is purchased
by the Seller pursuant to subsection 12.2(a) shall, for the purposes of the
------------------
definition of "Seller Interest", be deemed to be equal to zero on the
Distribution Date following the making of the deposit, and the Seller Interest
shall thereupon be deemed to have been increased by the Investor Interest of
such Series.
SECTION 12.3 Final Payment with Respect to any Series.
----------------------------------------
(a) Written notice of any termination, specifying the Distribution Date
upon which the Investor Certificateholders of any Series may surrender their
Certificates for payment of the final distribution with respect to such Series
and cancellation, shall be given (subject to at least 2 Business Days' prior
notice from the Servicer to the Trustee) by the Trustee to Investor
Certificateholders of such Series (and the Enhancement Provider if so provided
in the related Supplement) mailed not later than the fifth day of the month of
such final distribution (or in the manner provided by the Supplement relating to
such Series) specifying (a) the Distribution Date (which shall be the
Distribution Date in the month (x) in which the deposit is made
-116-
pursuant to Section 3.4(e), 9.2, 10.2, or, if applicable, subsection 12.2(a) of
-------------- --- ---- ------------------
the Agreement or such other section as may be specified in the related
Supplement, or (y) in which the related Series Termination Date occurs) upon
which final payment of such Investor Certificates will be made upon presentation
and surrender of such Investor Certificates at the office or offices therein
designated (which, in the case of Bearer Certificates, shall be outside the
United States), (b) the amount of any such final payment and (c) that the Record
Date otherwise applicable to such Distribution Date is not applicable, payments
being made only upon presentation and surrender of the Investor Certificates at
the office or offices therein specified. The Servicer's notice to the Trustee
in accordance with the preceding sentence shall be accompanied by an Officer's
Certificate setting forth the information specified in Article V of the
---------
Agreement covering the period during the then current calendar year through the
date of such notice and setting forth the date of such final distribution. The
Trustee shall give such notice to the Transfer Agent and Registrar and the
Paying Agent at the time such notice is given to such Investor
Certificateholders.
(b) Notwithstanding the termination of the Trust pursuant to subsection
----------
12.1(a) or the occurrence of the Series Termination Date with respect to any
-------
Series, all funds then on deposit in the Collection Account or any Series
Account shall continue to be held in trust for the benefit of the
Certificateholders of the related Series and the Paying Agent or the Trustee
shall pay such funds to the Certificateholders of the related Series upon
surrender of their Certificates (which surrenders and payments, in the case of
Bearer Certificates, shall be made only outside the United States). In the
event that all of the Investor Certificateholders of any Series shall not
surrender their Certificates for cancellation within six months after the date
specified in the above-mentioned notice, the Trustee shall give a second written
notice (in the case of Bearer Certificates, publication notice) to the remaining
Investor Certificateholders of such Series upon receipt of the appropriate
records from the Transfer Agent and Registrar to surrender their Certificates
for cancellation and receive the final distribution with respect thereto. If
within one and one-half years after the second notice with respect to a Series,
all the Investor Certificates of such Series 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 Investor Certificateholders of
such Series concerning surrender of their 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 upon request any monies held by them for
the payment of the principal or interest which remains unclaimed for two years.
After payment to the Seller,
-117-
Investor Certificateholders entitled to the money must look solely to the Seller
for payment as general creditors unless an applicable abandoned property law
designates another Person.
(c) All Certificates surrendered for payment of the final distribution
with respect to such Certificates and cancellation shall be canceled by the
Transfer Agent and Registrar and be disposed of in a manner satisfactory to the
Trustee and the Seller.
SECTION 12.4 Seller's Termination Rights. Upon the termination of the
---------------------------
Trust pursuant to Section 12.1 of the Agreement and the surrender of the
------------
Exchangeable Seller Certificate, the Trustee shall return to the Holder of the
Exchangeable Seller Certificate (without recourse, representation or warranty)
all right, title and interest of the Trust in the Receivables, whether then
existing or thereafter created, all monies due or to become due with respect
thereto and all proceeds thereof and Recoveries and the Interchange allocable to
the Trust pursuant to subsections 2.5(k) and (l) except for amounts held by the
------------------ ---
Trustee pursuant to subsection 12.3(b) of the Agreement. The Trustee shall
------------------
execute and deliver such instruments of transfer and assignment, on behalf of
the Trust, in each case without recourse, as shall be reasonably requested by
the Holder of the Exchangeable Seller Certificate to vest in the Holder of the
Exchangeable Seller Certificate all right, title and interest which the Trust
had in the Receivables.
[End of Article XII]
-118-
ARTICLE XIII
MISCELLANEOUS PROVISIONS
SECTION 13.1 Amendment.
---------
(a) (i) This Agreement may be amended from time to time by the
Servicer, the Seller and the Trustee, without the consent of any holder of
any outstanding Certificate, to cure any ambiguity, to correct or
supplement any provisions herein which may be inconsistent with any other
provisions herein, to add any other provisions with respect to matters or
questions arising under this Agreement which shall not be inconsistent with
the provisions of this Agreement; provided, however, that such action shall
-------- -------
not adversely affect in any material respect the interests of any Investor
Certificateholders. The Trustee may request an Officer's Certificate and/or
an Opinion of Counsel on these matters, prior to executing an amendment.
The Trustee may, but shall not be obligated to, enter into any such
amendment which affects the Trustee's rights, duties or immunities under
this Agreement or otherwise.
(ii) This Agreement may be amended from time to time by the Seller,
the Servicer and the Trustee, with the consent of the Trustee (and the
Enhancement Provider, if so provided in the related Supplement) and without
the consent of the Certificateholders, to (A) provide for the transfer by
the Seller of its interest in and to all or part of the Accounts in
accordance with the provisions of Section 7.2 hereof, (B) provide for the
-----------
purchase of Principal Receivables by the Trust at a price which is less
than 100% of the outstanding balance thereof, and to provide thereafter for
the treatment of Collections of Principal Receivables, in an amount up to
the aggregate amount by which the purchase price of Principal Receivables
sold thereafter is less than 100%, as Collections of Finance Charge
Receivables; provided, however, that any such action shall not adversely
-------- -------
affect in any material respect the interests of the Certificateholders;
further provided that the Servicer and the Trustee shall have received
notice from the Rating Agency that such amendment pursuant to this Section
-------
13.1(a)(ii) will not result in the reduction or withdrawal of its then-
-----------
existing rating of the Certificates of any Series.
(b) This Agreement and any Supplement may also be amended from time to
time by the Servicer, the Seller and the Trustee with the consent of the Holders
of Investor Certificates evidencing Undivided Interests aggregating not less
than 66-2/3% of the Investor Interest of each outstanding Series adversely
-119-
affected by such amendment (and, to the extent provided in any Supplement, with
the consent of the related Enhancement Provider, which consent shall not be
unreasonably withheld) for the purpose of adding any provisions to or changing
in any manner or eliminating any of the provisions of this Agreement or
modifying in any manner the rights of holders of any Series then issued and
outstanding (provided, however, that the right of any Enhancement Provider to
consent pursuant to any Supplement to any such amendment shall be limited to
matters involving (i) the provisions of this Agreement which affect such
Enhancement Provider, (ii) the provisions of the related Supplement, and (iii)
the rights of holders of the related Series); provided, however, that no such
-------- -------
amendment shall (i) reduce in any manner the amount of, or delay the timing of,
distributions which are required to be made on any Investor Certificate without
the consent of each Investor Certificateholder of such Series, (ii) change the
definition of or the manner of calculating the Undivided Interest of any
Investor Certificateholder of such Series without the consent of each Investor
Certificateholder of such Series, (iii) reduce the aforesaid percentage required
to consent to any such amendment, without the consent of each Investor
Certificateholder of all Series adversely affected (and, to the extent provided
in any Supplement, with the consent of the related Enhancement Provider, which
consent shall not be unreasonably withheld) or (iv) result in any withdrawal or
downgrade of the rating of the Certificates.
(c) Notwithstanding anything in this Section 13.1 to the contrary the
------------
Series Supplement with respect to any Series may be amended on the items and in
accordance with the procedures provided in such Series Supplement.
(d) Promptly after the execution of any amendment the Trustee shall
furnish such amendment to any related Enhancement Provider and to the Rating
Agency; provided, however, that the Trustee shall furnish a copy of each such
-------- -------
amendment pursuant to subsection 13.1(a)(ii) to the Rating Agency prior to the
----------------------
execution of such amendment.
(e) It shall not be necessary for the consent of Investor
Certificateholders under this Section 13.1 to approve the particular form of any
------------
proposed amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Investor Certificateholders shall be
subject to such reasonable requirements as the Trustee may prescribe.
-120-
SECTION 13.2 Protection of Right, Title and Interest to Trust.
------------------------------------------------
(a) The Servicer shall cause this Agreement, all amendments hereto and/or
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 or the Trustee, as the case may be,
hereunder to all property comprising the Trust. The Servicer shall deliver to
the Trustee file-stamped copies of, or filing receipts for, any document
recorded, registered or filed as provided above, as soon as available following
such recording, registration or filing. 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
subsection 13.2(a).
------------------
(b) Within 30 days after the Seller makes any change in its name, identity
or corporate structure which would make any financing statement or continuation
statement filed in accordance with paragraph (a) above materially misleading
within the meaning of Section 9-402(7) of the UCC as in effect in the State of
New York, 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) Each of the Seller and the Servicer will give the Trustee prompt
written notice of any relocation of any office from which it services
Receivables or keeps records concerning the Receivables (including the
establishment of any office from which it services the 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 continue the
perfection of the Trust's security interest in the Receivables and the proceeds
thereof. Each of the Seller and the Servicer will at all times maintain each
office from which it services Receivables and its principal executive office
within the United States of America.
(d) The Servicer will deliver to the Trustee: (i) upon the execution and
delivery of each amendment of Article I, II, III or IV hereto (or, with respect
--------- -- --- --
to Article IV, as incorporated in the related Supplement; provided, however,
---------- -------- -------
that the adoption of a
-121-
Supplement pursuant to Section 6.9 of the Agreement which supplements or
modifies Article IV for a particular new Series shall not be considered an
----------
amendment), other than amendments pursuant to subsection 13.1(a), and upon each
------------------
date that any Additional Accounts or Automatic Additional Accounts are to be
included in the Accounts pursuant to Section 2.6 hereof, an Opinion of Counsel
-----------
substantially in the form of Exhibit F; and (ii) on or before March 31 of each
---------
year, beginning with March 31, 1994 an Opinion of Counsel, substantially in the
form of Exhibit G.
---------
SECTION 13.3 Limitation on Rights of Certificateholders.
------------------------------------------
(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 Certificateholder's legal representatives or heirs to claim an
accounting or to take any action or commence any proceeding in any court for a
partition or winding up of the Trust, nor otherwise affect the rights,
obligations and liabilities of the parties hereto or any of them.
(b) No Certificateholder shall have any right to vote (except with respect
to the Investor Certificateholders as provided in Section 13.1 hereof) or in any
------------
manner otherwise control the operation and management of the Trust, or the
obligations of the parties hereto, nor shall anything herein set forth, or
contained in the terms of the Certificates, be construed so as to constitute the
Certificateholders from time to time as partners or members of an association;
nor shall any 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 Certificateholder shall have any right by virtue of any provisions
of this Agreement to institute any suit, action or proceeding in equity or at
law upon or under or with respect to this Agreement, unless such
Certificateholder previously shall have given to the Trustee, and unless the
Holders of Certificates evidencing Undivided Interests aggregating more than 50%
of the Investor Interest of any Series which may be adversely affected but for
the institution of such suit, action or proceeding, shall have made written
request upon 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 its receipt of
such notice, 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 Certificateholder with every other
Certificateholder and the Trustee, that no one or more
-122-
Certificateholders shall have the 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 Certificateholders of any other of the
Certificates, or to obtain or seek to obtain priority over or preference to any
other such 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 Certificateholders. For the protection and enforcement of the
provisions of this Section 13.3, each and every Certificateholder and the
------------
Trustee shall be entitled to such relief as can be given either at law or in
equity.
SECTION 13.4 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.
SECTION 13.5 Notices. All demands, notices, instructions and
-------
communications hereunder shall be in writing and shall be deemed to have been
duly given if personally delivered at or sent by first class mail, facsimile or
courier to (a) in the case of the Seller and the Servicer, to People's Bank, 000
Xxxx Xxxxxx, Xxxxxxxxxx, Xxxxxxxxxxx 00000, Attention: Xxxxxxx X. Xxxxxxxx,
Esq., (b) in the case of the Trustee, Four Albany Street, 10th Floor, New York,
New York 10006, Attention: Corporate Trust and Agency Group, Structured Finance
Team and (c) in the case of the Enhancement Provider for a particular Series,
the address, if any, specified in the Supplement relating to such Series; or, as
to each party, at such other address as shall be designated by such party in a
written notice to each other party. Unless otherwise provided with respect to
any Series in the related Supplement any notice required or permitted to be
mailed to a Certificateholder shall be given by first class mail, postage
prepaid, at the address of such Certificateholder as shown in the Certificate
Register or, with respect to any notice required or permitted to be made to the
Holders of Bearer Certificates, by publication in the manner provided in the
related Supplement. Any notice so mailed within the time prescribed in this
Agreement shall be conclusively presumed to have been duly given, whether or not
the Certificateholder receives such notice. Any notice required to be delivered
hereunder to Certificateholders, any report delivered by Servicer or independent
certified public accountants under Article III, any amendment or supplement
-----------
delivered pursuant to Section 13.1, and any opinion delivered hereunder shall be
------------
given by first class mail, postage prepaid, to Moody's at Xxxxx'x Investors
Service, Inc., 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: ABS
Xxxxxxxxxx Xxxxxxxxxx, 0xx Xxxxx and to Standard & Poor's at Standard and Poor's
Corporation, 00 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Asset-Backed
Surveillance Group or with respect to any other
-123-
Rating Agency, the address supplied by such Rating Agency in writing to the
Servicer. The Seller and the Servicer, as the case may be, shall provide 60
days' prior written notice to the Investor Certificateholders of any sale of
Accounts pursuant to Section 7.2(b) or any transfer of Servicing pursuant to
--------------
Section 8.2(b) or 8.5.
-------------- ---
SECTION 13.6 Severability of Provisions. If any one or more of the
--------------------------
covenants, agreements, provisions or terms of this Agreement shall for any
reason whatsoever be held invalid, then such covenants, agreements, provisions
or terms shall be deemed severable from the remaining covenants, agreements,
provisions or terms of this Agreement and shall in no way affect the validity or
enforceability of the other provisions of this Agreement or of the Certificates
or rights of the Certificateholders thereof.
SECTION 13.7 Certificates Non-Assessable 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 Undivided Interests
represented by the Certificates shall be non-assessable for any losses or
expenses of the Trust or for any reason whatsoever, and that Certificates upon
authentication thereof by the Trustee pursuant to Sections 2.1 and 6.2 are and
------------ ---
shall be deemed fully paid.
SECTION 13.8 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, without limitation, the
execution of any financing statements or continuation statements relating to the
Receivables for filing under the provisions of the UCC of any applicable
jurisdiction.
SECTION 13.9 No Waiver; Cumulative Remedies. No failure to exercise and
------------------------------
no delay in exercising, on the part of the Trustee, any Enhancement Provider or
the Investor Certificateholders, any right, remedy, power or privilege
hereunder, shall operate as a waiver thereof; nor shall any single or partial
exercise of any right, remedy, power or privilege hereunder preclude any other
or further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges herein provided are
cumulative and not exhaustive of any rights, remedies, powers and privileges
provided by law.
SECTION 13.10 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.
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SECTION 13.11 Third-Party Beneficiaries. This Agreement will inure to the
-------------------------
benefit of and be binding upon the parties hereto, the Certificateholders and,
to the extent provided in the related Supplement, the Enhancement Provider named
therein, and their respective successors and permitted assigns. Except as
otherwise provided in this Article XIII, no other Person will have any right or
------------
obligation hereunder.
SECTION 13.12 Actions by Certificateholders.
-----------------------------
(a) Wherever in this Agreement a provision is made that an action may be
taken or a notice, demand or instruction given by Investor Certificateholders,
such action, notice or instruction may be taken or given by any Investor
Certificateholder, unless such provision requires a specific percentage of
Investor Certificateholders.
(b) Any request, demand, authorization, direction, notice, consent, waiver
or other act by a Certificateholder shall bind such Certificateholder and every
subsequent holder of such Certificate issued upon the registration of transfer
thereof or in exchange therefor or in lieu thereof in respect of anything done
or omitted to be done by the Trustee or the Servicer in reliance thereon,
whether or not notation of such action is made upon such Certificate.
SECTION 13.13 Rule 144A Information. For so long as any of the Investor
---------------------
Certificates of any Series or any Class are "restricted securities" within the
meaning of Rule 144(a)(3) under the Securities Act of 1933 each of the Seller,
the Servicer, the Trustee and the Enhancement Provider for such Series agrees to
cooperate with the others to provide to any Investor Certificateholders of such
Series or Class and to any prospective purchaser of Certificates designated by
such an Investor Certificateholder upon the request of such Investor
Certificateholder or prospective purchaser, any information required to be
provided to such holder or prospective purchaser to satisfy the condition set
forth in Rule 144 A(d)(4) under the Act.
SECTION 13.14 Merger and Integration. Except as specifically stated
----------------------
otherwise herein, this Agreement sets forth the entire understanding of the
parties relating to the subject matter hereof, and all prior understandings,
written or oral, are superseded by this Agreement. This Agreement may not be
modified, amended, waived or supplemented except as provided herein.
SECTION 13.15 Headings. The headings herein are for purposes of reference
--------
only and shall not otherwise affect the meaning or interpretation of any
provision hereof.
[End of Article XIII]
-125-
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.
PEOPLE'S BANK,
Seller and Servicer
By:
------------------------------
Name:
Title:
BANKERS TRUST COMPANY,
not in its individual capacity
but solely as Trustee
By:
------------------------------
Name:
Title:
-126-
EXHIBIT A
---------
FORM OF EXCHANGEABLE SELLER CERTIFICATE
---------------------------------------
No. 1 One Unit
PEOPLE'S BANK CREDIT CARD MASTER TRUST
EXCHANGEABLE SELLER CERTIFICATE
THE TRANSFER OF THIS CERTIFICATE IS SUBJECT TO RESTRICTIONS SET FORTH IN THE
AGREEMENT REFERRED TO HEREIN. A COPY OF THE AGREEMENT WILL BE FURNISHED TO THE
HOLDER OF THIS CERTIFICATE BY THE TRUSTEE UPON WRITTEN REQUEST.
This Certificate represents Seller Interest in
----------------------------------------------
People's Bank Credit Card Master Trust
--------------------------------------
Evidencing an interest in a trust, the Corpus of which consists of a portfolio
of VISA/*/ and MasterCard/*/ credit card receivables generated or to be
generated by People's Bank.
(Not an interest in or an obligation of
People's Bank
or any Affiliate thereof.)
This certifies that PEOPLE'S STRUCTURED FINANCE CORP. (the "Holder") is the
------
registered owner of an undivided interest in People's Bank Credit Card Master
Trust (the "Trust") not represented by any Series of Investor Certificates
-----
issued pursuant to the Amended and Restated Pooling and Servicing Agreement
dated as of March [ ], 1997 or any Supplement thereto (as the Amended and
Restated Pooling and Servicing Agreement may be amended, supplemented or
otherwise modified from time to time in accordance with its terms, including by
any Supplement thereto, the "Agreement"). The corpus of the Trust (a) as of
---------
March [ ], 1997 consists of (i) a portfolio of receivables (the "Receivables")
-----------
then existing or thereafter created and arising in connection with certain VISA
and MasterCard credit card accounts (the "Accounts") of People's Bank (the
--------
"Seller"), a Connecticut stock savings bank, and in connection with any accounts
-------
that meet the definition of Automatic Additional Accounts (other than
Receivables in Additional Accounts), (ii) all monies and investments due or to
become due with respect thereto (including all Finance Charge Receivables),
(iii) all proceeds of such Receivables, (iv) Recoveries allocable to the Trust
pursuant to the Agreement, and (v) Interchange allocable to the Trust
-----------------------
/*/ VISA and MasterCard are registered trademarks of VISA USA, Inc. and
MasterCard International Incorporated, respectively.
A-1
pursuant to the Agreement and all proceeds thereof, and (b) consists of or will
from time to time consist of (vi) monies and investments on deposit, from time
to time, in the Collection Account, the Excess Funding Account, the Series
Accounts maintained for the benefit of the Certificateholders of any Series of
Certificates, and (vii) any Enhancement and all monies available under any
Enhancement, provided or to be provided for any Series for payment to the
Certificateholders of such Series (clauses (a) and (b) above, collectively, the
"Trust Assets").
------------
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 that Agreement for information with respect to the interests, rights,
benefits, obligations, proceed and duties evidenced hereby. A copy of the
Agreement, may be requested from the Trustee by writing to the Trustee at Xxxx
Xxxxxx Xxxxxx, Xxx Xxxx, XX 00000; Attention: Corporate Trust Office. To the
extent not defined herein, the capitalized terms used herein have the meanings
assigned in the Agreement. This Certificate is issued under and is subject to
the terms, provisions and conditions of the Agreement, to which Agreement the
Holder by virtue of the acceptance hereof assents and by which the Holder is
bound.
THE AGREEMENT AND THE CERTIFICATES CREATED THEREUNDER 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.
This Certificate has not been registered or qualified under the Securities
Act of 1933, as amended, and any state securities law. No sale, transfer or
other disposition of this Certificate shall be permitted other than in
accordance with the provisions of Sections 6.3 or 6.9 of the Agreement.
The Receivables consist of Principal Receivables which arise generally from
the purchase of goods, services and cash advances and of Finance Charges and
other fees and charges, as more fully specified in the Agreement.
This Certificate is the Exchangeable Seller Certificate (the "Certificate"),
-----------
which represents an interest in the Trust, including the right to receive the
Collections and other amounts at the times and in the amounts specified in the
Agreement to be paid to the Holder of the Exchangeable Seller Certificate. The
aggregate interest represented by this Certificate at any time in the
Receivables in the Trust shall not exceed the Seller Interest at such time. In
addition to this Certificate, Investor Certificates will be issued to investors
from time to time pursuant to the Agreement, each of which will represent the
A-2
interests of Investor Certificateholders of a specific Series in the Trust.
This Certificate shall not represent any interest in the Collection Account, any
Series Account, or any Enhancement. The Seller Interest on any date of
determination will generally be an amount equal to the aggregate amount of
Principal Receivables at the end of the day immediately prior to such date of
determination minus the Aggregate Investor Interest at the end of such day.
-----
This Certificate does not represent an obligation of, or any interest in, the
Seller or the Servicer, and neither the Certificates nor the Accounts or
Receivables are insured or guaranteed by the Federal Deposit Insurance
Corporation or any other government agency. This Certificate has a limited
right of payment to certain Collections respecting the Receivables, all as more
specifically set forth hereinabove and in the Pooling and Servicing Agreement.
Subject to prior termination of the Trust, the Agreement, the obligations
created by the Agreement and the Trust shall terminate on the earlier to occur
of (i) the day after the Distribution Date with respect to any Series following
the date on which funds shall have been deposited in the Collection Account or
the applicable Series Account for the payment of Investor Certificateholders of
each Series then issued and outstanding sufficient to pay the Aggregate Investor
Interest plus interest accrued at the applicable Certificate Rate through the
end of the related Interest Accrual Period prior to the Distribution Date with
respect to each such Series in full (unless a Trust Extension shall have
occurred pursuant to Section 12.1 of the Agreement), (ii) if a Trust Extension
shall have occurred, the Extended Trust Termination Date, and (iii) the
expiration of 21 years from the death of the last survivor of the descendants of
Xxxxxx X. Xxxxxxx, the father of the late President of the United States, living
on the date of the Agreement. Upon the termination of the Trust pursuant to
Section 12.1 of the Agreement, the Trustee shall assign and convey to the Holder
of the Seller Certificate (without recourse, representation or warranty) all
right, title and interest of the Trust in the Receivables, whether then existing
or thereafter created, and all proceeds thereof and Interchange relating thereto
and Recoveries allocable to the Trust and the proceeds thereof. The Trustee
shall execute and deliver such instruments of transfer and assignment, in each
case without recourse, as shall be reasonably requested by the Holder of the
Seller Certificate to vest in such Holder all right, title and interest which
the Trustee had in the Receivables.
Unless the certificate of authentication hereon has been executed by or on
behalf of the Trustee, by manual signature,
A-3
this Certificate shall not be entitled to any benefit under the Agreement, or be
valid for any purpose.
IN WITNESS WHEREOF, People's Bank, has caused this Certificate to be duly
executed by its duly authorized officer.
PEOPLE'S BANK
By: ___________________________
Name:
Title:
Dated ______________, _____
A-4
Form of Trustee's Certificate of Authentication
-----------------------------------------------
This is the Seller Certificate referred to in the within mentioned Amended
and Restated Pooling and Servicing Agreement.
BANKERS TRUST COMPANY
By:___________________________
Authorized Officer
A-5
EXHIBIT B
---------
FORM OF ASSIGNMENT OF RECEIVABLES IN
------------------------------------
ADDITIONAL ACCOUNTS
-------------------
ASSIGNMENT No. ____ OF RECEIVABLES IN ADDITIONAL ACCOUNTS, dated as of
_____________, __________ by and between PEOPLE'S BANK, a Connecticut stock
savings bank (the "Seller"), to Bankers Trust Company, a New York banking
corporation, not in its individual capacity but solely as trustee (the
"Trustee"), pursuant to the Pooling and Servicing Agreement referred to below.
W I T N E S S E T H:
-------------------
WHEREAS, the Seller and the Trustee are parties to the Amended and Restated
Pooling and Servicing Agreement, dated as of March [ ], 1997 (as heretofore
amended, supplemented or otherwise modified, the "Pooling and Servicing
Agreement");
WHEREAS, pursuant to the Pooling and Servicing Agreement the Seller wishes to
designate Additional Accounts of the Seller to be included as Accounts and to
convey the Receivables of such Additional Accounts, whether now existing
hereinafter created, to the Trust as part of the corpus of the Trust (as each
such term is defined in the "Pooling and Servicing Agreement); and
WHEREAS, the Trustee is willing to accept such designation and conveyance
subject to the terms and conditions hereof;
NOW, THEREFORE, the Seller and the Trustee hereby agree as follows:
SECTION 1. Defined Terms. All terms defined in the Pooling and Servicing
-------------
Agreement and used herein shall have such defined meanings when used herein,
unless otherwise defined herein.
"Addition Date" shall mean, with respect to the Additional Accounts
-------------
designated hereby, ____________________, _________________________.
"Addition Notice Date" shall mean, with respect the Additional Accounts
--------------------
designated hereby, ________________, (which shall be a date on or prior to the
fifth Business Day with respect to Accounts added pursuant to Section 2.6(a)
prior to the twentieth Business Day pursuant to Section 2.6(a)(i) prior to the
Addition Date.)
B-1
SECTION 2. Designation of Additional Accounts. The Seller shall deliver to
----------------------------------
the Trustee, on behalf of the Trust, not later than three Business Days after
the Addition Date, a computer file or microfiche list containing a true and
complete list of each VISA and MasterCard account which, as of the Addition Date
shall be deemed to be an Additional Account (such accounts being identified by
account number as of the close of business on the Additional Date by including
in such computer file or microfiche list code "____" with respect to the first
addition of Accounts; "____________________" with respect to the second
addition of Accounts, and so on in sequence, in the dependent number field.
Such list shall be marked as Schedule I to this Agreement and, as of the
Addition Date, shall be incorporated into and made a part of this Assignment.]
SECTION 3. Deposits into the Collection Account.
------------------------------------
(a) Not later than the second Business Day following the completion of each
Billing Cycle in which the Addition Date occurs, the Servicer shall deposit into
the Collection Account any amounts received from the Obligors relating to the
Additional Accounts to which such Billing Cycle relates during such Billing
Cycle to the extent not so deposited pursuant to subsection 3(b) below and
Article IV of the Agreement.
(b) On or before the second Business Day following the end of each Billing
Cycle which occurs during the 30-days immediately following such Addition Date,
the Seller shall deposit into the Collection Account an amount equal to, with
respect to Receivables in the Additional Accounts in each Billing Cycle in which
the Addition Date occurs, the Collections of Finance Charge Receivables and
Principal Receivables processed on each Date of Processing from and including
the first Date of Processing in such Billing Cycle through and including the
Date of Processing immediately preceding the Addition Date.
SECTION 4. Conveyance of Receivables.
-------------------------
(a) The Seller does hereby transfer, assign, set-over and otherwise convey to
the Trustee, on behalf of the Trust, for the benefit of the Certificateholders,
without recourse on and after the Addition Date, all right, title and interest
of the Transferor in and to (i) the Receivables now existing and hereafter
created in the Additional Accounts designated hereby, (ii) all monies due or to
become due with respect thereto (including all Finance Charge Receivables),
(iii) all proceeds of such Receivables, (iv) Insurance proceeds relating to the
Receivables, (v) Recoveries allocable to the Trust and (vi) Interchange related
to such Receivables pursuant to Subsection 2.5(k) of the Pooling and Servicing
Agreement.
B-2
(b) In connection with such transfer, the Seller agrees to record and file,
at its own expense, a financing statement with respect to the Receivables now
existing and hereafter created in the Automatic Additional Accounts designated
hereby (which may be a single financing statement with respect to all such
Receivables) for the transfer of accounts as defined in Section 9-106 of the UCC
as in effect in the State of New York meeting the requirements of applicable
state law in such manner and such jurisdictions as are necessary to perfect the
assignment of such Receivables to the Trust, and to deliver a file-stamped copy
of such financing statement or other evidence of such filing (which may, for
purposes of this Section 4. consist of telephone confirmation of such filing) to
the Trustee on or prior to the date of this Assignment.
(c) In connection with such transfer, the Seller further agrees, at its own
expense, on or prior to the date of this Assignment to indicate in its computer
files by including in such computer file or microfiche list the code "____" with
respect to the first addition of Accounts, "____" with respect to the second
addition of Accounts, and so on in sequence, in the dependent number field that
Receivables created in connection with the Additional Accounts designated hereby
have been transferred to the Trust pursuant to this Assignment for the benefit
of the Certificateholders.
SECTION 5. Acceptance by Trustee. The Trustee hereby acknowledges its
---------------------
acceptance on behalf of the Trust of all right, title and interest previously
held by the Seller in and to (i) the Receivables now existing and hereafter
created in the Additional Accounts designated hereby, (ii) all monies to be due
with respect thereto (including all Finance Charge Receivables), (iii) all
proceeds of such Receivables, (iv) Insurance Proceeds relating to the
Receivables, (v) Recoveries allocated to the Trust and (vi) Interchange relating
to such Receivables pursuant to Subsection 2.5(k) of the Pooling and Servicing
Agreement, and declares that it shall maintain such right, title and interest,
upon the trust set forth in the Pooling and Servicing Agreement, for the benefit
of all Certificateholders.
SECTION 6. Representations and Warranties of the Seller. The Seller hereby
--------------------------------------------
represents and warrants to the Trustee and the Trust as of the Addition Date:
(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 (i) 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'
B-3
rights in general and the rights of creditors of Connecticut stock savings
banks, (ii) as such enforceability may be limited by general principles of
equity (whether considered in a suit at law or in equity), (iii) subject to
the unenforceability of provisions indemnifying a party against liability
where such indemnification is contrary to public policy, (iv) subject to
the effect of judicial decisions which have held that certain covenants and
provisions of agreements are unenforceable where (y) the breach of such
covenants or provisions imposes restrictions or burdens where it cannot be
demonstrated that such breach is a material breach of a material covenant
or provision, or (z) the creditor's enforcement of such covenants or
provisions under the circumstances would violate the creditor's implied
covenant of good faith and fair dealing, and (v) subject to the
unenforceability of provisions herein to the effect that the failure to
exercise or delay in exercising rights or remedies will not operate as a
waiver of any such rights or remedies, or to the effect that provisions
therein may only be waived in writing to the extent that an oral agreement
modifying such provisions has been entered into.
(b) Eligibility of Accounts. Each Additional Account designated
-----------------------
hereby is, as of the end of the related Billing Cycle immediately preceding
the Addition Date, an Eligible Additional Account.
(c) Selection Procedures. No selection procedures believed by the
--------------------
Seller to be materially adverse to the interests of the Investor
Certificateholders were utilized in selecting the Additional Accounts
designated hereby from the available Eligible Additional Accounts owned by
the Seller.
(d) Insolvency. As of the Addition Date, the Seller is not insolvent
----------
and, after giving effect to the conveyance set forth in Section 4 of this
Assignment, will not be insolvent.
(e) Security Interest. This Assignment constitutes either (i) a valid
-----------------
transfer and assignment to the Trust of all right, title and interest of
the Seller in and to Receivables now existing and hereafter created in the
Additional Accounts designated hereby, and all proceeds (as defined in the
UCC as in effect in the State of New York) of such Receivables and
Insurance Proceeds and Recoveries relating thereto, and such Receivables
and any proceeds thereof and Recoveries allocable to the Trust and the
Interchange relating to such Receivables pursuant to Section 2.5(k) of the
Agreement will be held by the Trust free and clear of any Lien of any
Person claiming through or
B-4
under Seller or any of its Affiliates except for (x) Liens permitted under
subsection 2.3(b) of the Pooling and Servicing Agreement and subject to
Section 9.306 of the UCC in effect in the State of New York, (y) the
interest of the Holder of the Seller Certificate and (z) the Seller's right
to interest accruing on, and investment earnings in respect of, the
Collection Account, the Retention Account or any Series Account as provided
in the Pooling and Servicing Agreement; or (ii) it constitutes a grant of a
security interest (as defined in the UCC as in effect in the State of New
York) in such property to the Trust, which is enforceable with respect to
the existing Receivables of the [Additional Accounts] [Automatic Additional
Accounts] designated hereby, the proceeds (as defined in the UCC as in
effect in the State of New York) thereof and Insurance Proceeds relating
thereto upon the conveyance of such Receivables to the Trust, and which
will be enforceable with respect to the Receivables thereafter created in
respect of Additional Accounts designated hereby, the proceeds (as defined
in the UCC as in effect in the State of New York) thereof, Recoveries
allocable to the Trust and Interchange with respect to such Receivables
pursuant to subsection 2.5(k) of the Pooling and Servicing Agreement upon
such creation; and (iii) if this Assignment constitutes the grant of a
security interest to the Trust in such property, upon the filing of a
financing statement described in Section 4 of this Assignment with respect
to the Additional Accounts designated hereby and, in the case of
Receivables hereafter created in such Additional Accounts and the proceeds
(as defined in the UCC as in effect in the State of New York) thereof,
Insurance Proceeds relating to such Receivables, Recoveries allocable to
the Trust and Interchange with respect to such Receivables pursuant to
subsection 2.5(k) of the Pooling and Servicing Agreement, upon such
creation, the Trust shall have a first priority perfected security interest
in such property, except for Liens permitted under subsection 2.5(b) of the
Pooling and Servicing Agreement or as provided in Section 9-306 of the UCC
as in effect in the State of Connecticut or New York, whichever is
applicable.
SECTION 7. Conditions Precedent. The acceptance of the Trustee set forth
--------------------
in Section 5 and the amendment of the Pooling and Servicing Agreement set forth
in Section 8 are subject to the satisfaction, on or prior to the Addition Date,
of the following conditions precedent:
(1) Officer's Certificate. The Seller shall have delivered to the
---------------------
Trustee a certificate of a Vice President or more senior officer,
certifying that (i) all requirements set forth in Section 2.6 of the
Pooling and Servicing Agreement for designating Additional Accounts and
conveying
B-5
the Principal Receivables of such Accounts, whether now existing or
hereafter created, have been satisfied and (ii) each of the representations
and warranties made by the Seller in Section 6 is true and correct as of
the Addition Date. The Trustee may conclusively rely on such Officer's
Certificate, shall have no duty to make inquiries with regard to the
matters set forth therein, and shall incur no liability in so relying.
(2) Opinion of Counsel. The Seller shall have delivered to the
------------------
Trustee an opinion of Counsel with respect to the Additional Accounts
designated hereby substantially in the form of Exhibit F to the Pooling and
Servicing Agreement.
(3) Additional Information. The Seller shall have delivered to the
----------------------
Trustee such information as was reasonably requested by the Trustee to
satisfy itself as to the accuracy of the representation and warranty set
forth in subsection 6(d) to this Agreement.
(4) Notice of Addition of Accounts. The Seller (i) shall have
------------------------------
provided the Rating Agency, the Servicer and the Enhancement Provider, if
so provided in the Supplement with respect to any Series, with the notice
specified provided in subsections 2.6(f) of the Pooling and Servicing
Agreement, at the time specified therein.
SECTION 8. Amendment of the Pooling and Servicing Agreement. The Pooling
------------------------------------------------
and Servicing Agreement is hereby amended to provided that all references
therein to the "Pooling and Servicing Agreement," to "this Agreement" and
"herein" shall be deemed from and after the Addition Date to be a dual reference
to the Pooling a Servicing Agreement as supplemented by this Assignment. Except
as expressly amended hereby, all of the representations, warranties, terms,
covenants and conditions of the Pooling and Servicing Agreement shall remain
unamended and shall continue to be, and shall remain, in full force and effect
in accordance with its terms and except as expressly provided herein shall not
constitute or be deemed to constitute a waiver of compliance with or a consent
to noncompliance with any term or provision of the Pooling and Servicing
Agreement.
SECTION 9. Counterparts. This Assignment may be executed in two or more
------------
counterparts (and by different parties or separate counterparts), each of which
shall be an original, but all of which together shall constitute one and the
same instrument.
SECTION 10. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
-------------
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS
CONFLICT OF LAWS PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
B-6
IN WITNESS WHEREOF, the undersigned have caused this Assignment of
Receivables in Additional Accounts to be duly executed and delivered by their
respective duly authorized officers on the day and year first above written.
PEOPLE'S BANK
By: ___________________________
Name:
Title:
BANKERS TRUST COMPANY, not in its
individual capacity, but solely
as Trustee
By: ___________________________
Name:
Title:
B-7
Schedule 1
to Assignment of
Receivables in
Additional Accounts
-------------------
ADDITIONAL ACCOUNTS
[Deemed Incorporated]
B-8
EXHIBIT C
---------
FORM OF MONTHLY SERVICER'S CERTIFICATE
--------------------------------------
__________________________________
PEOPLE'S BANK
__________________________________
People's Bank Credit Card Master Trust, Series ______
__________________________________
For the __________ Determination Date
For the __________ Monthly Period
The undersigned, a duly authorized representative of The People's Bank, as
Servicer pursuant to the Amended and Restated Pooling and Servicing Agreement
dated as of March [ ], 1997 (as heretofore amended, supplemented or otherwise
modified, the "Pooling and Servicing Agreement") by and between People's Bank
and Bankers Trust Company, as Trustee, does hereby certify as follows:
1. Capitalized terms used in this Certificate have their respective
meanings set forth in the Pooling and Servicing Agreement; provided, that
--------
the "preceding Monthly Period" shall mean the Monthly Period immediately
preceding the calendar month in which this Certificate is delivered. This
Certificate is delivered pursuant to subsection 3.4(b) of the Pooling and
Servicing Agreement. References herein to certain sections and subsections
are references to the respective sections and subsections of the Pooling
and Servicing Agreement, as amended by the applicable Series Supplement.
2. People's Bank is Servicer under the Pooling and Servicing
Agreement.
3. The undersigned is a Servicing Officer.
4. The date of this Certificate is _______________, 199__ which is a
Determination Date under the Pooling and
Servicing Agreement.
5. The aggregate amount of Collections processed during the preceding
Monthly Period (equal to 5(a) plus 5(b)) was equal to $_______________
C-1
(a) The aggregate amount of Collections of Finance Charge
Receivables collected during the preceding Monthly Period (the "Collections
of Finance Charge
Receivables') was equal to $_______________
(b) The aggregate amount of Collections of Principal Receivables
collected during the preceding Monthly Period (the "Collections of
Principal Receivables") was equal to $_______________
6. The aggregate amount of Receivables as of the end of the last day
of the preceding Monthly Period was equal to $_______________
7. Attached hereto is a true and correct copy of the statements
required to be delivered by the Servicer on the date of this Certificate to
the Paying Agent pursuant to Article V.
8. To the knowledge of the undersigned, there are no Liens on any
Receivables in the Trust except as described below:
[If applicable, insert "None".]
9. The amount by which the Aggregate Principal Receivables exceeds
the Aggregate Principal Receivables required to be maintained pursuant to
the Pooling and Servicing Agreement, is equal to $_______________
C-2
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this certificate this _______ day of ___________________, ___________.
PEOPLE'S BANK,
Servicer
By:
---------------------------
Name:
Title:
C-3
Schedule - to Monthly
Servicer's Certificate/*/
PEOPLE'S BANK
___________________________________
People's Bank Credit Card Master Trust, Series _________
___________________________________
For the _________ Determination Date
For the _________ Monthly Period
1. The aggregate amount of Collections processed during the preceding
Monthly Period (equal to 1(a) plus 1(b)) was equal to $_______________
(a) The aggregate amount of Collections of Finance Charge Receivables
collected during the preceding Monthly Period (the "Collections of Finance
Charge Receivables") allocated to Series ___ was equal to
$_______________
(b) The aggregate amount of Collections of Principal Receivables
collected during the preceding Monthly Period (the "Collections of
Principal Receivables") allocated to Series ___ was equal to
$_______________
2. The aggregate amount of funds on deposit in the [Collection Account
applicable to Series __] [Collection Subaccount with respect to Series __]
[Series Account with respect to Series __] with respect to Collections
processed during the preceding Monthly Period, and applicable to Series __]
as of the Closing Date relating to the preceding Monthly Period was equal
to $_______________
3. (a) The aggregate amount of funds on deposit in the [Principal Account]
with respect to Collections processed during the preceding Monthly Period
and allocated to Series ___, as of the end of the last day of the preceding
Monthly Period was equal to $_______________
--------------------
/*/ A separate schedule is to be attached for each Series, with appropriate
changes to reflect the specifics of the related Series Supplement.
C-4
(b) The aggregate amount of funds which will be on deposit in
the [Principal Account] on the Transfer Date following this Determination
Date, will be $_______________
4. The aggregate amount to funds on deposit in the Retention
Subaccount relating to Series ___ as of the end of the last day of the
preceding Monthly Period was equal to $_______________
5. The aggregate amount of [drawings] [withdrawals] [payments] required to
be made under the [Letter of Credit] [Cash Collateral Account] [other form
of Enhancement] pursuant to Section ___ or ___ on the Date in the current
calendar month is equal to $_______________
6. (a) The aggregate amount of Interchange to be deposited to the
Collection Account and allocated to Series ___ on the [next succeeding
Transfer Date] is equal to $_______________
(b) The amount of earnings (net of losses and investment expenses) on funds
on deposit in the Principal Funding Account to be transferred from the
Principal Funding Account to the [Finance Charge Account] on the (next
succeeding Transfer Date] is equal to $_______________
7. The sum of all amounts payable to the Investor Certificateholders
of Series on the Distribution Date in the current Monthly Period is equal
to:
Payable in respect of
principal ______________ $_______________
Payable in respect of
interest ______________ $_______________
Total $_______________
8. [No Series Pay Out Event or Trust Pay Out Event has occurred.] [The
following [Series Pay Out Event] [Trust Pay Out Event] has occurred:
__________________.]
C-5
Form of Series 1997-1 Monthly Servicer's Report
PEOPLE'S BANK CREDIT CARD MASTER TRUST SERIES 1997-1
MONTHLY SERVICER'S REPORT
Number of Months Series in Existence
Monthly Period Ended
Distribution Date
Determination Date
Number of Days in Period
------------------------------------------------------
1. Trust Activity Series 1997-1
Beginning of Month - Aggregate Principal Receivables
Principal Collections on the Receivables
Finance Charge Receivables
Receivables in Defaulted Accounts
End of Month - Aggregate Principal Receivables
Investor Interest Series 1993-1
Investor Interest Series 1994-1
Investor Interest Series 1994-2
Investor Interest Series 1995-1
Investor Interest Series 1997-1
Seller Principal Receivables
Total Investor Percentage with respect to...
Finance Charges
Charged-Off Accounts
Principal Receivables
Class A Percentage with respect to...
Finance Charges
Charged-Off Accounts
Principal Receivables
Class B Percentage with respect to...
Finance Charges
Charged-Off Accounts
Principal Receivables
Seller Percentage with respect to ...
Finance Charges
Charged-Off Accounts
Principal Receivables
---------------------------------------------------------------------
2. Allocation of Funds in Collection Account
Class A Available Finance Charge Collections
Class A Monthly Cap Interest Payable to Class A Certificateholders
(See "Calculation of Certificate Interest" #3)
Unpaid Class A Monthly Cap Interest
Class A Monthly Servicing Fee
(See"Calculation of Monthly Servicing Fee" #6)
Unpaid Class A Monthly Servicing Fee
Class A Investor Default Amount
Unreimbursed Class A Investor Charge-offs
Excess Spread from Class A Finance Charge Collections
Class A Required Amount
Class B Available Finance Charge Collections
Class B Monthly Cap Interest Payable to Class B Certificateholders
(See "Calculation of Certificate Interest" #3)
Unpaid Class B Monthly Cap Interest
Class B Monthly Servicing Fee
(See"Calculation of Monthly Servicing Fee" #6)
Unpaid Class B Monthly Servicing Fee
Class B Investor Default Amount
Unreimbursed Class B Investor Charge-offs
Excess Spread from Class B Finance Charge Collections
Class B Required Amount
Total Excess Spread
---------------------------------------------------------------------
2. Allocation of Funds in Collection Account (con't)
Excess Spread used to Satisfy Class A Required Amount
Excess Spread used to satisfy Unpaid Class A Monthly Cap Interest
Excess Spread used to satisfy Unpaid Class A Monthly Servicing Fee
Excess Spread used to satisfy Unreimbursed Class A Investor Charge-offs
Remaining Class A Required Amount
Excess Spread used to satisfy Class B Required Amount
Excess Spread used to satisfy Unpaid Class B Monthly Cap Interest
Excess Spread used to satisfy Unpaid Class B Monthly Servicing Fee
Excess Spread used to satisfy Unreimbursed Class B Investor Charge-offs
Remaining Class B Required Amount
Shared Finance Charges used to satisfy Remaining Class A Required Amount
Shared Finance Charges used to satisfy Unpaid Class A Monthly Cap Interest
Shared Finance Charges used to satisfy Unpaid Class A Monthly Servicing
Fee
Shared Finance Charges used to satisfy Unreimbursed Class A Investor
Charge-offs
Remaining Class A Required Amount
Cash Collateral Withdrawal used to satisfy Remaining Class A Required Amount
Cash Collateral Withdrawal used to satisfy Unpaid Class A Monthly Cap
Interest
Cash Collateral Withdrawal used to satisfy Unpaid Class A Monthly
Servicing Fee
Cash Collateral Withdrawal used to satisfy Unreimbursed Class A Investor
Charge-offs
Remaining Class A Required Amount
Class B Reallocated Amount used to satisfy Remaining Class A Required Amount
Class B Reallocated Amount used to satisfy Unpaid Class A Monthly Cap
Interest
Class B Reallocated Amount used to satisfy Unpaid Class A Monthly
Servicing Fee
Class B Reallocated Amount used to satisfy Unreimbursed Class A Investor
Charge-offs
Remaining Class A Required Amount
Class B Investor Interest used to satisfy Unreimbursed Class A Investor
Charge-offs
Shared Finance Charges used to satisfy Remaining Class B Required Amount
Shared Finance Charges used to satisfy Unpaid Class B Monthly Cap Interest
PEOPLE'S BANK CREDIT CARD MASTER TRUST SERIES 1997-1
MONTHLY SERVICER'S REPORT
Number of Months Series in Existence
Monthly Period Ended
Distribution Date
Determination Date
Number of Days in Period
----------------------------------------------------------------------
Shared Finance Charges used to satisfy Unpaid Class B Monthly Servicing
Fee
Shared Finance Charges used to satisfy Unreimbursed Class B Investor
Charge-offs
Remaining Class B Required Amount
----------------------------------------------------------------------
2. Allocation of Funds in Collection Account (con't)
Cash Collateral Withdrawal used to satisfy Remaining Class B Required Amount
Cash Collateral Withdrawal used to satisfy Unpaid Class B Monthly Cap
Interest
Cash Collateral Withdrawal used to satisfy Unpaid Class B Monthly
Servicing Fee
Cash Collateral Withdrawal used to satisfy Unreimbursed Class B Investor
Charge-offs
Remaining Class B Required Amount
Excess Spread used to satisfy interest on overdue Class A
(See "Calculation of Certificate Interest" #3)
Excess Spread used to satisfy interest on overdue Class B
(See "Calculation of Certificate Interest" #3)
Excess Spread used to satisfy reimbursements of Class B Interest
Excess Spread used to satisfy deposits into Required Cash Collateral Account
Excess Spread used to satisfy shortfalls of the Class A Interest Payments
Excess Spread used to satisfy shortfalls of the Class B Interest Payments
Excess Spread used to satisfy payments per Loan Agreement
Excess Spread used to satisfy Class A Excess Interest
Excess Spread used to satisfy Class B Excess Interest
Remaining Excess Servicing (dollars)
Remaining Excess Servicing (percentage of Investor Interest)
Class A Investor Certificate Interest Shortfall (Deficiency Amounts)
Class A Charge-offs
Unreimbursed Class A Charge Offs
Unreimbursed Class A Charge Offs per $1,000 Original Investment
Class A Monthly Servicing Fee Shortfall
Class B Investor Certificate Interest Shortfall
----------------------------------------------------------------------
2. Allocation of Funds in Collection Account (con't)
Class B Charge-offs
Unreimbursed Class B Charge Offs
Unreimbursed Class B Charge Offs per $1,000 Original Investment
Class B Monthly Servicing Fee Shortfall
Available Principal Collections
Monthly Principal Payable To Class A Certificateholders
(See "Calculation of Monthly Principal" #4)
Monthly Principal Payable To Class B Certificateholders
(See "Calculation of Monthly Principal" #4)
Monthly Principal Reinvested In Receivables
(See "Calculation of Monthly Principal" #4)
(Net Deposit)/Draws on Shared Principal Collections
Required Shared Finance Charge Collections from other Series
Draw on Shared Finance Charge Collections from other Series
Withdrawal from Cash Collateral Account
Class B Investor Certificate Interest Shortfall (Deficiency Amounts)
Required Shared Finance Charge Collections for other Series
Deposit of Shared Finance Charge Collections for other Series
Total Distribution to Class A Investors
Total Distribution to Class A Investors per $1,000 Invested
Total Distribution to Class B Investors
Total Distribution to Class B Investors per $1,000 Invested
----------------------------------------------------------------------
3. Calculation of Certificate Interest
Class A Certificate Rate
Class A Interest Rate Cap Provider Deposit
Previous Month's Class A Deficiency Amount
Class A Interest at the Certificate Rate + 0.5% on Deficiency Amount
This Month Class A Certificate Interest
PEOPLE'S BANK CREDIT CARD MASTER TRUST SERIES 1997-1
MONTHLY SERVICER'S REPORT
Number of Months Series in Existence
Monthly Period Ended
Distribution Date
Determination Date
Number of Days in Period
--------------------------------------------------
Expected Class B Principal
This Month Class B Cap Shortfall
Class B Excess Interest
Total Class B Interest Distributable to Class B Certificateholders
Total Class B Interest Distributable per $1,000 of Class B Original
Investment
Total Certificate Interest Distributable to Certificateholders
Total Certificate Interest Distributable per $1,000 of Original Investment
--------------------------------------------------
4. Calculation of Monthly Principal
Beginning Investor Interest
Beginning Class A Interest
Class A Available Principal Collections
Class A Monthly Unreimbursed Charge-Offs
Total Class A Monthly Principal
Class A Monthly Principal Reinvested in Receivables
Class A Controlled Amortization Amount
Maximum Monthly Principal to Class A Certificateholders
Class A Deficit Controlled Amortization Amount
Monthly Principal Payable to Class A Certificateholders
Class A Monthly Principal Payable per $1,000 of Original Investment
Beginning Class B Interest
Class B Available Principal Collections
Class B Monthly Unreimbursed Charge-Offs
Total Class B Monthly Principal
Class B Reallocated Principal
Prior Month's Cumulative Class B Reallocated Principal
Class B Reduction of Interest
Prior Month's Cumulative Class B Reduction of Interest
Class B Monthly Principal Reinvested in Receivables
Class B Controlled Amortization Amount
Maximum Monthly Principal to Class B Certificateholders
--------------------------------------------------
4. Calculation of Monthly Principal (con't)
Required Shared Principal Collections for other Series
Deposit of Shared Principal Collections for other Series
Required Shared Principal Collections from other Series
Draw on Shared Principal Collections from other Series
Class B Deficit Controlled Amortization Amount
Monthly Principal Payable to Class B Certificateholders
Class B Monthly Principal Payable per $1,000 of Original Investment
Ending Investor Interest
Ending Class A Interest
Ending Class B Interest
5. Calculation of Pool Factor
Pool Factor
(Ending Certificate Balance divided by Initial Principal Amount to 7 decimal
places)
6. Calculation of Monthly Servicing Fee
Series Servicing Fee Percentage
Beginning Class A Investor Interest
Beginning Class B Investor Interest
Beginning Investor Interest
Class A Monthly Servicing Fee
Class B Monthly Servicing Fee
Total Monthly Servicing Fee
7. Cash Collateral Account Activity
Beginning of Month Balance
Required Cash Collateral Account Amount
Excess Spread used to satisfy payments per Loan Agreement
Cash Collateral Account Deposits
Reinvestment Income Received on Cash Collateral Account
Aggregate Cash Collateral Account Draws
Available Cash Collateral Amount (Dollars)
Available Cash Collateral Amount (Percentage)
--------------------------------------------------
8. Past Due Statistics
(past due on a contractual basis)
1-30 days past due Dollars
Percent Dollars
Number of Accts
Percent Number of Accts
31-60 days past due Dollars
Percent Dollars
Number of Accts
Percent Number of Accts
61-90 days past due Dollars
Percent Dollars
Number of Accts
Percent Number of Accts
91-120 days past due Dollars
Percent Dollars
Number of Accts
Percent Number of Accts
PEOPLE'S BANK CREDIT CARD MASTER TRUST SERIES 1997-1
MONTHLY SERVICER'S REPORT
Number of Months Series in Existence
Monthly Period Ended
Distribution Date
Determination Date
Number of Days in Period
------------------------------------------------------------------
121-150 days past due Dollars
Percent Dollars
Number of Accts
Percent Number of Accts
151-180 days past due Dollars
Percent Dollars
Number of Accts
Percent Number of Accts
181 + days past due Dollars
Percent Dollars
Number of Accts
Percent Number of Accts
------------------------------------------------------------------
9. Base Rate Calculation
Base Rate
Portfolio Yield (net of losses)
Excess of Portfolio Yield over Base Rate
10. Number of Accounts in the Trust
Number of Additional Accounts
Number of Removed Accounts
Number of Automatic Additonal Accounts
Ending Number of Accounts
EXHIBIT D
---------
FORM OF ANNUAL SERVICER'S CERTIFICATE
-------------------------------------
PEOPLE'S BANK
__________________________________
People's Bank Credit Card Master Trust Series
__________________________________
The undersigned, a duly authorized representative of People's Bank, as
Servicer pursuant to the Amended and Restated Pooling and Servicing Agreement
dated as of March [ ], 1997 (as heretofore amended, supplemented or otherwise
modified, the "Pooling and Servicing Agreement") by and between People's Bank
and Bankers Trust Company, as trustee (the "Trustee"), does hereby certify that:
1. People's Bank is Servicer under the Pooling and Servicing
Agreement.
2. The undersigned is duly authorized pursuant to the Pooling and
Servicing Agreement to execute and deliver this Certificate to the Trustee.
3. This Certificate is delivered pursuant to Section 3.5 of the
Pooling and Servicing Agreement.
4. A review of the activities of the Servicer during [the period from
the Closing Date until] [the calendar year ended] December 31, ____ was
conducted under my supervision.
5. Based on such review, the Servicer has, to the best of my
knowledge, fully performed all its obligations under the Pooling and
Servicing Agreement throughout such [period] [calendar year] and no default
in the performance of such obligations has occurred or is continuing except
as set forth in paragraph 6 below.
6. The following is a description of each default in the performance
of the Servicer's obligations under the provisions of the Pooling and
Servicing Agreement including any Supplement known to me to have been made
during [such period] [the calendar year ended ____________, _________,]
which sets forth in detail (i) the nature of 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."]
D-1
IN WITNESS WHEREOF, the undersigned has duly executed and delivered this
certificate this ____ day of _______________, _______.
PEOPLE'S BANK
By:
-----------------------------
Name:
Title:
D-2
EXHIBIT E
---------
FORM OF
SELLER CERTIFICATE DESIGNATING BANKS AND
AGENT BANKS THE ACCOUNTS OF WHICH
CONSTITUTE AUTOMATIC ADDITIONAL ACCOUNTS
----------------------------------------
This Certificate is delivered pursuant to that certain Amended and Restated
Pooling and Servicing Agreement dated as of March [ ], 1997 (as heretofore
amended, supplemented or otherwise modified, the "Pooling and Servicing
Agreement") by and between People's Bank, a Connecticut stock savings bank, as
seller and servicer (the "Seller"), and Bankers Trust Company, a banking
corporation organized and existing under the laws of the State of New York, as
trustee (the "Trustee"). Capitalized terms used and not otherwise defined
herein shall have the meanings ascribed to such terms in the Pooling and
Servicing Agreement.
Pursuant to the Pooling and Servicing Agreement, the Seller is hereby
designating to the Trustee the following ["banks" and "agent banks"] [insert
name of other applicable grouping] of credit card accounts maintained by [Total
Systems, Inc. (or its successor)] [insert name of other records processor] on
behalf of the Seller as [banks and agent banks] [name of other grouping] the
accounts in which (other than existing Accounts or Additional Accounts)
constitute Automatic Additional Accounts:
[insert bank and agent bank (or other grouping) identification codes]
E-1
IN WITNESS WHEREOF, the undersigned has duly executed and delivered this
certificate this __ day of _____.
PEOPLE'S BANK
By:
------------------------
Name:
Title:
Acknowledged by:
BANKERS TRUST COMPANY,
as Trustee under the
Pooling and Servicing
Agreement
By:
---------------------------
Name:
Title:
E-2
EXHIBIT F
---------
FORM OF
OPINION OF COUNSEL PURSUANT TO
SECTIONS 2.6(G)(VI) AND 13.2(D)(I)
OF THE POOLING AND SERVICING AGREEMENT
--------------------------------------
[PULLMAN AND XXXXXX TO PROVIDE]
-------------------------------
F-1
EXHIBIT G
---------
FORM OF
ANNUAL SECURITY INTEREST OPINION PURSUANT TO
SECTIONS 13.2(D)(II) OF THE
POOLING AND SERVICING AGREEMENT
-------------------------------
PULLMAN & XXXXXX, LLC
Attorneys At Law
000 XXXX XXXXXX X.X. XXX 0000
XXXXXXXXXX, XX 00000-0000
Reply to: Bridgeport
Telephone: (000) 000-0000
March [ ], 1997
VIA AIRBORNE EXPRESS
Bankers Trust Company
Four Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
RE: PEOPLE'S BANK CREDIT CARD MASTER TRUST (THE "TRUST")
----------------------------------------------------
Ladies and Gentlemen:
We have been asked, in our capacity as special Connecticut counsel for
People's Bank, a Connecticut capital stock savings bank (the "Servicer"), to
provide an opinion to you pursuant to Section 13.2(d)(ii) of an Amended and
Restated Pooling and Servicing Agreement dated as of March [ ], 1997 (the
"Pooling and Servicing Agreement") by and between you, as Trustee, and the
Servicer.
In connection with this opinion, we have had reference to: our opinion
dated July 9, 1993 delivered to you in connection with the issuance by the Trust
of its 4.80% Asset Backed Certificates, Series 1993-1; our opinion dated
February 16, 1994 delivered to you in connection with the issuance by the Trust
of its 5.10% Asset Backed Certificates, Series 1994-1; our opinion dated October
4, 1994 delivered to you in connection with the transfer and assignment of New
Receivables to the Trust; our opinion dated October 27, 1994 delivered to you
in connection with the issuance by the Trust of its Floating Rate Class A Asset
Backed Certificates, Series 1994-2 and its Floating Rate Class B Asset Backed
Certificates, Series 1994-2; our opinion dated March 28, 1995 delivered to you
in connection with the issuance by the Trust of its Floating Rate Class A Asset
Backed Certificates, Series 1995-1 and its Floating Rate Class B Asset Backed
Certificates, Series 1995-1; our opinion dated July 14, 1995 delivered to you in
connection with the transfer and assignment of additional New Receivables to the
Trust; our opinion dated July 2, 1996 delivered to you in connection with the
issuance by the Trust of its Floating Rate Class A Asset Backed Certificates,
Series 1997-1 and Floating Rate Class B Asset Backed Certificates, Series 1996-
1; and our opinion dated October 1, 1996 delivered to you in connection with the
transfer and assignment of additional New Receivables to the Trust
(collectively, the "Prior Opinions"). Copies of the Prior Opinions are attached
hereto.
PULLMAN & XXXXXX, LLC
Page 2
We have also had reference to copies of (i) a Form UCC-1 filed with the
Office of the Secretary of State of the State of Connecticut, UCC Division (the
"Connecticut Secretary of State") on July 9, 1993 in connection with the initial
transfer and assignment of Receivables to the Trust, (ii) a Form UCC-1 filed
with the Connecticut Secretary of State on October 4, 1994 in connection with
the transfer and assignment of certain New Receivables to the Trust, (iii) a
Form UCC-3 filed with the Connecticut Secretary of State on October 28, 1994,
amending the Form UCC-1 filed with the Connecticut Secretary of State on October
4, 1994, (iv) a Form UCC-1 filed with the Connecticut Secretary of State on July
13, 1995, in connection with the transfer and assignment of certain additional
New Receivables to the Trust, and (v) a Form UCC-1 filed with the Connecticut
Secretary of State on September 23, 1996, in connection with the transfer and
assignment of certain additional New Receivables (collectively, the "UCC
Financing Statements"). Copies of the UCC Financing Statements described in the
immediately preceding sentence are also attached hereto.
Unless otherwise specified, capitalized terms used herein shall have the
same meanings as set forth in the Prior Opinions, and capitalized terms defined
differently in one or more of the Prior Opinions shall have the meanings set
forth in the Prior Opinion bearing the most recent date. This opinion is
rendered subject to all of the qualifications, assumptions, limitations and
exceptions taken or made in the Prior Opinions, whether expressly stated or
incorporated by reference therein.
This opinion is provided as of the date above first set forth. We disclaim
any obligation to advise you as to subsequent changes of facts, circumstances,
or applicable law or regulation that might affect the validity of the opinion
set forth herein.
Based upon the foregoing, we are of the opinion that no filing or other
action is necessary from the date hereof through March 1, 1998 to continue the
perfected status of the interest of the Trust in such of the Receivables and the
proceeds thereof as constitute "accounts" or "general intangibles". This
opinion is subject to the limitations noted in the Prior Opinions as to
Receivables and the proceeds thereof generally, and as to Receivables that are
generated in connection with Automatic Additional Accounts.
This opinion is rendered to you in compliance with Section 13.2(d)(ii) of
the Pooling and Servicing Agreement, is intended solely for your benefit, and is
not intended for the use, benefit or reliance of any other person, and may not
be relied upon by you or any other person for any other purpose. Your
acceptance of this letter or reliance on this opinion, or any part thereof, will
be presumed conclusively to evidence the Servicer's compliance with the
provisions of Section 13.2(d)(ii) of the Pooling and Servicing Agreement and the
satisfaction of you and your counsel with the form, scope and substance of this
letter.
PULLMAN & XXXXXX, LLC
Page 3
This letter, together with each of the Prior Opinions, constitutes a single
integrated document, and no portion hereof may be relied upon without reference
to the entirety of this letter and each of the Prior Opinions, and each other
part hereof and thereof.
Very truly yours,
PULLMAN & XXXXXX, LLC
P&C/nadh:dc
cc: Xxxxxxx X. Xxxxxxxx, Esquire
Xxxxx XxXxxxxx, Esquire
EXHIBIT H
---------
FORM OF DEPOSITORY AGREEMENT
----------------------------
H-1
EXHIBIT I
---------
FORM OF REASSIGNMENT OF REMOVED ACCOUNTS
----------------------------------------
REASSIGNMENT No. ___ of RECEIVABLES, dated as of ______________, ___ (this
"Reassignment"), by and between PEOPLE'S BANK, a Connecticut capital stock
savings bank (the "Transferor"), and BANKERS TRUST COMPANY, a banking
corporation organized and existing under the laws of the State of New York (the
"Trustee"), pursuant to the Pooling and Servicing Agreement referred to below.
WHEREAS, the Transferor and the Trustee are parties to the Amended and
Restated Pooling and Servicing Agreement, dated as of March [ ], 1997
(hereinafter as such agreement may have been, or may from time to time be,
amended, supplemented or otherwise modified, the "Pooling and Servicing
Agreement");
WHEREAS, pursuant to the Pooling and Servicing Agreement, the Transferor
wishes to remove all Receivables (such term and other capitalized terms used
herein without definition being defined in Section 1 hereof) from the Accounts
designated pursuant to Section 3 hereof (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 Transferor; 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 Transferor and the Trustee hereby agree as follows:
1. Defined Terms. Capitalized terms used but not otherwise defined herein
-------------
shall have the meanings assigned to such terms in the Pooling and Servicing
Agreement.
"Removal Date" shall mean, with respect to the Removed Accounts designated
------------
hereby, _____________, 19___.
"Removal Notice Date" shall mean, with respect to the Removed Accounts
-------------------
designated hereby, _____________, 19___, which shall be a date on or prior to
the fifth Business Day prior to the Removal Date).
2. Conveyance of Receivables. (a) The Trustee does hereby transfer,
-------------------------
assign, set-over and otherwise convey to the Transferor without recourse, on and
after the Removal Date, all
I-1
right, title and interest of the Trust in and to the Receivables now existing
and hereafter created in the Removed Accounts designated hereby, all monies due
or to become due with respect thereto (including all Finance Charge
Receivables), all proceeds (as defined in Section 9-306 of the UCC as in effect
in the State of Connecticut or New York) of such Receivables and the right to
receive amounts paid as Interchange with respect to such Removed Accounts
pursuant to the Pooling and Servicing Agreement.
(b) In connection with such transfer, the Trustee agrees to execute and
deliver to the Transferor of the Removed Accounts, on or prior to the date of
this Reassignment, a termination statement with respect to the Receivables now
existing and hereafter created in the Removed Accounts designated hereby (which
may be a single termination statement with respect to all such Receivables)
evidencing the release by the Trust of its lien on the Receivables in the
Removed Accounts, and meeting the requirements of applicable state law, in such
manner and such jurisdictions as are necessary to remove such lien, provided
that such termination statement shall be prepared by the Transferor.
3. Designation of Removed Accounts. The Transferor of the Removed Accounts
-------------------------------
shall deliver to the Trustee, not later than five Business Days after the
Removal Date, a computer file or microfiche list containing a true and complete
list of each Account which as of the Removal Date shall be deemed to be a
Removed Account, such Accounts being identified by account number and by the
aggregate amount of Principal Receivables in such Accounts as of the close of
business on the Removal Date. Such list shall be marked as Schedule 1 to this
Reassignment and shall be incorporated into and made a part of this Reassignment
as of the Removal Date.
4. Acceptance by Trustee. The Trustee hereby acknowledges and agrees that,
---------------------
prior to or simultaneously with the execution and delivery of this Reassignment,
the Transferor delivered to the Trustee the computer file or microfiche list
described in Section 2 of this Reassignment.
5. Representations and Warranties of the Transferor. The Transferor hereby
------------------------------------------------
represents and warrants to the Trust as of the Removal Date as follows:
(a) Legal Valid and Binding Obligation. This Reassignment constitutes a
----------------------------------
legal, valid and binding obligation of such Transferor enforceable against the
Transferor in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect affecting the enforcement of
creditors' rights in general and the rights of creditors of state-chartered
banking associations and except as
I-2
such enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity).
(b) Absence of Pay Out Event or Certain Other Events. The removal of any
------------------------------------------------
Receivables of any Removed Accounts on any Removal Date will not, in the
reasonable belief of the Transferor, (i) cause a Pay Out Event to occur (for
which determination the Receivables of each Removed Account shall be considered
to have been removed as of the Removal Date), (ii) cause the Seller Interest as
a percentage of Aggregate Principal Receivables to be less than 10% on such
Removal Date or (iii) result in the failure to make any payment specified in the
related Supplement with respect to any Series.
(c) Selection Procedures. No selection procedures believed by the
--------------------
Transferor to be materially adverse to the interests of the Investor
Certificateholders without regard to any Enhancement were utilized in selecting
the Removed Accounts designated hereby.
6. Conditions to Reassignment. The removal from the Trust and reassignment
--------------------------
to the Transferor of the Receivables in the Removed Accounts as of the Removal
Date is subject to the satisfaction, on or prior to the date hereof, of the
following conditions:
(a) Notice Designating Removed Accounts. Within five Business Days after
-----------------------------------
the Removal Date, the Transferor shall have delivered or caused to be delivered
to the Trustee, pursuant to Section 3 hereof, a computer file or microfiche list
containing a true and complete list of all Removed Accounts identified by
account number and the aggregate amount of the Principal Receivables in such
Removed Accounts as of the Removal Date.
(b) Officer's Certificate. The Transferor shall have delivered to the
---------------------
Trustee an Officer's Certificate certifying that (i) as of the Removal Date, all
requirements set forth in Section 2.7 of the Pooling and Servicing Agreement for
designating Removed Accounts and reconveying the Receivables of such Removed
Accounts, whether now existing or hereafter created, have been satisfied, other
than the delivery by the Transferor to the Trustee within five Business Days
after the Removal Date of a computer file or microfiche list of the Removed
Accounts, and (ii) each of the representations and warranties made by the
Transferor of the Removed Accounts in Section 5 hereof is true and correct as of
the Removal Date. The Trustee may conclusively rely on such Officer's
Certificate, shall have no duty to make inquiries with regard to the matters set
forth therein and shall incur no liability in so relying.
I-3
(c) Notice to Rating Agency. On or before the twentieth Business Day prior
-----------------------
to the Removal Date, the Rating Agency shall have received notice of such
proposed removal of Accounts.
(d) Rating Agency Confirmation. The Transferor and the Trustee shall have
--------------------------
received notice from the Rating Agency that such proposed removal of Accounts
will not result in the reduction or withdrawal of its then exiting rating of any
Series of Certificates then issued and outstanding.
(e) Opinion of Counsel The Transferor, the Trustee and the Rating Agencies
------------------
shall have received an Opinion of Counsel that the proposed removal shall not
adversely effect the federal income tax characterization of the Trust.
7. 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 together shall constitute one and the
same instrument.
IN WITNESS WHEREOF, the undersigned have caused this Reassignment to be duly
executed and delivered by their respective duly authorized officers on the day
and year first above written.
PEOPLE'S BANK,
as Transferor
By: ___________________________
Name:
Title:
BANKERS TRUST COMPANY, not in its
individual capacity, but solely as
Trustee
By: ___________________________
Name:
Title:
I-4
EXHIBIT J
---------
FORM OF
OFFICER'S CERTIFICATE PURSUANT TO
SECTION 2.8(d)(ii) OF THE
POOLING AND SERVICING AGREEMENT
-------------------------------
The undersigned, _________________, a duly authorized officer of People's
Bank, a Connecticut stock savings bank, hereby certifies, not in [his][her]
individual capacity, but solely as a duly authorized officer of People's Bank,
as follows:
(i) This Certificate is delivered pursuant to Section 2.8(d)(ii) of
the Amended and Restated Pooling and Servicing Agreement dated as of March
[ ], 1997 (as heretofore amended, supplemented or otherwise modified, the
"Pooling and Servicing Agreement") by and between People's Bank, a
-------------------------------
Connecticut stock savings bank, as seller and servicer (the "Seller"), and
------
Bankers Trust Company, a New York banking corporation, not in its
individual capacity but solely as trustee (the "Trustee") of the People's
-------
Bank Credit Card Master Trust pursuant to the Pooling and Servicing
Agreement. Capitalized terms used herein and not otherwise defined herein
shall have the meanings set forth in the Pooling and Servicing Agreement.
(ii) The undersigned is duly authorized pursuant to the Pooling and
Servicing Agreement to execute and deliver this Certificate.
(iii) All requirements set forth in Sections 2.7(a) of the Pooling
and Servicing Agreement for the designation of Expired Accounts and the
deletion and removal from the Trust and reassignment to the Seller of
Receivables from Expired Accounts have been satisfied as of the date
hereof.
(iv) Each of the representations and warranties made by the Seller in
Section 2.8(c) of the Pooling and Servicing Agreement is true and correct
as of the Expired Account Removal Date occurring on ____________, ____; and
(v) Each of the conditions to the deletion and removal from the Trust
and reassignment to the Seller of Receivables from Removed Accounts set
forth in Sections 2.7(b) and 2.8(d) of the Pooling and Servicing Agreement
have been satisfied as of the Expired Account Removal Date.
J-1
IN WITNESS WHEREOF, the undersigned has duly executed and delivered
this certificate this ___ day of ________, ____.
PEOPLE'S BANK
By:
-----------------------------
Name:
Title:
J-2
