EXHIBIT 4.1
Execution Copy
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AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION III LLC,
AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION IV LLC
and
AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION II,
as Transferors,
AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC.
as Servicer,
and
THE BANK OF NEW YORK,
as Trustee and as Securities Intermediary
AMERICAN EXPRESS CREDIT ACCOUNT MASTER TRUST
POOLING AND SERVICING AGREEMENT
Dated as of May 16, 1996,
as amended and restated as of April 16, 2004
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Table of Contents
Page
ARTICLE I DEFINITIONS............................................................................................1
Section 1.01 Definitions.......................................................................1
Section 1.02 Other Definitional Provisions....................................................25
ARTICLE II CONVEYANCE OF RECEIVABLES............................................................................26
Section 2.01 Conveyance of Receivables........................................................26
Section 2.02 Acceptance by Trustee............................................................28
Section 2.03 Representations and Warranties of Each Transferor Relating to Such
Transferor.......................................................................29
Section 2.04 Representations and Warranties of each Transferor Relating to the
Agreement and any Supplement and the Receivables.................................30
Section 2.05 Reassignment of Ineligible Receivables...........................................33
Section 2.06 Reassignment of Certificateholders' Interest in Trust Portfolio..................34
Section 2.07 Covenants of each Transferor.....................................................34
Section 2.08 Additional Covenants of Each Transferor Regarding the Terms of the
Accounts.........................................................................39
Section 2.09 Addition of Accounts.............................................................43
Section 2.10 Removal of Accounts and Participation Interests..................................44
Section 2.11 Account Allocations..............................................................45
Section 2.12 Discount Option..................................................................46
Section 2.13 Premium Option...................................................................
ARTICLE III ADMINISTRATION AND SERVICING OF RECEIVABLES.........................................................47
Section 3.01 Acceptance of Appointment and Other Matters Relating to the Servicer.............47
Section 3.02 Servicing Compensation...........................................................48
Section 3.03 Representations, Warranties and Covenants of the Servicer........................48
Section 3.04 Reports and Records for the Trustee..............................................50
Section 3.05 Annual Certificate of Servicer...................................................51
Section 3.06 Annual Servicing Report of Independent Public Accountants; Copies of
Reports Available................................................................51
Section 3.07 Tax Treatment....................................................................51
Section 3.08 Notices to American Express Entities.............................................52
Section 3.09 Adjustments......................................................................52
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Table of Contents
(continued)
Page
Section 3.10 Recoveries.......................................................................53
Section 3.11 Reports to the Commission........................................................53
ARTICLE IV RIGHTS OF CERTIFICATEHOLDERS AND ALLOCATION AND APPLICATION OF COLLECTIONS...........................54
Section 4.01 Rights of Certificateholders.....................................................54
Section 4.02 Establishment of Collection Account and Special Funding Account..................54
Section 4.03 Collections and Allocations......................................................57
Section 4.04 Shared Principal Collections.....................................................58
Section 4.05 Allocation of Trust Assets to Series or Groups...................................59
Section 4.06 Issuer Rate Fees.................................................................59
Section 4.07 Manner of Holding Trust Assets...................................................59
ARTICLE V DISTRIBUTIONS AND REPORTS TO CERTIFICATEHOLDERS.......................................................60
ARTICLE VI THE CERTIFICATES.....................................................................................61
Section 6.01 The Certificates.................................................................61
Section 6.02 Authentication of Certificates...................................................61
Section 6.03 New Issuances....................................................................61
Section 6.04 Registration of Transfer and Exchange of Certificates............................63
Section 6.05 Mutilated, Destroyed, Lost or Stolen Certificates................................66
Section 6.06 Persons Deemed Owners............................................................66
Section 6.07 Appointment of Paying Agent......................................................67
Section 6.08 Access to List of Registered Certificateholders' Names and Addresses.............67
Section 6.09 Authenticating Agent.............................................................68
Section 6.10 Book-Entry Certificates..........................................................69
Section 6.11 Notices to Clearing Agency.......................................................70
Section 6.12 Definitive Certificates..........................................................70
Section 6.13 Global Certificate; Exchange Date................................................70
Section 6.14 Meetings of Certificateholders...................................................72
Section 6.15 Uncertificated Classes...........................................................74
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Table of Contents
(continued)
Page
ARTICLE VII OTHER MATTERS RELATING TO EACH TRANSFEROR...........................................................75
Section 7.01 Liability of each Transferor.....................................................75
Section 7.02 Merger or Consolidation of, or Assumption of the Obligations of, a
Transferor.......................................................................75
Section 7.03 Limitations on Liability of each Transferor......................................76
Section 7.04 Liabilities......................................................................76
Section 7.05 Assumption of a Transferor's Obligations.........................................77
Section 7.06 Expenses.........................................................................78
ARTICLE VIII OTHER MATTERS RELATING TO THE SERVICER.............................................................79
Section 8.01 Liability of the Servicer........................................................79
Section 8.02 Merger or Consolidation of, or Assumption of the Obligations of, the
Servicer.........................................................................79
Section 8.03 Limitation on Liability of the Servicer and Others...............................79
Section 8.04 Servicer Indemnification of the Trust and the Trustee............................80
Section 8.05 Resignation of the Servicer......................................................80
Section 8.06 Access to Certain Documentation and Information Regarding the Receivables........81
Section 8.07 Delegation of Duties.............................................................81
Section 8.08 Examination of Records...........................................................81
ARTICLE IX INSOLVENCY EVENTS....................................................................................82
Section 9.01 Rights upon the Occurrence of an Insolvency Event................................82
ARTICLE X SERVICER DEFAULTS.....................................................................................84
Section 10.01 Servicer Defaults................................................................84
Section 10.02 Trustee To Act; Appointment of Successor.........................................86
ARTICLE XI THE TRUSTEE..........................................................................................89
Section 11.01 Duties of Trustee................................................................89
Section 11.02 Certain Matters Affecting the Trustee............................................90
Section 11.03 Trustee Not Liable for Recitals in Certificates..................................92
Section 11.04 Trustee May Own Certificates.....................................................92
Section 11.05 The Servicer To Pay Trustee's Fees and Expenses..................................92
Section 11.06 Eligibility Requirements for Trustee.............................................93
Section 11.07 Resignation or Removal of Trustee................................................93
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Table of Contents
(continued)
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Section 11.08 Successor Trustee................................................................93
Section 11.09 Merger or Consolidation of Trustee...............................................94
Section 11.10 Appointment of Co-Trustee or Separate Trustee....................................94
Section 11.11 Tax Returns......................................................................95
Section 11.12 Trustee May Enforce Claims Without Possession of Certificates....................96
Section 11.13 Suits for Enforcement............................................................96
Section 11.14 Rights of Certificateholders To Direct Trustee...................................96
Section 11.15 Representations and Warranties of Trustee........................................96
Section 11.16 Maintenance of Office or Agency..................................................97
ARTICLE XII TERMINATION.........................................................................................98
Section 12.01 Termination of Trust.............................................................98
Section 12.02 Final Distribution...............................................................98
Section 12.03 Transferor's Termination Rights..................................................99
Section 12.04 Defeasance.......................................................................99
ARTICLE XIII MISCELLANEOUS PROVISIONS..........................................................................102
Section 13.01 Amendment; Waiver of Past Defaults..............................................102
Section 13.02 Protection of Right, Title and Interest to Trust................................105
Section 13.03 Limitation on Rights of Certificateholders......................................106
Section 13.06 Severability of Provisions......................................................108
Section 13.07 Certificates Nonassessable and Fully Paid.......................................108
Section 13.08 Further Assurances..............................................................108
Section 13.09 Nonpetition Covenant............................................................108
Section 13.10 No Waiver; Cumulative Remedies..................................................108
Section 13.11 Counterparts....................................................................108
Section 13.12 Third-Party Beneficiaries.......................................................108
Section 13.13 Actions by Certificateholders...................................................109
Section 13.14 Rule 144A Information...........................................................109
Section 13.15 Merger and Integration..........................................................109
Section 13.16 Headings........................................................................109
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EXHIBITS
Exhibit A Form of Transferor Certificate
Exhibit B Form of Assignment of Receivables in Additional Accounts
Exhibit C Form of Reassignment of Receivables in Removed Accounts
Exhibit D Form of Annual Servicer's Certificate
Exhibit E-1 Form of Opinion of Counsel with respect to Amendments
Exhibit E-2 Form of Opinion of Counsel with respect to Accounts
Exhibit E-3 Form of Annual Opinion of Counsel
Exhibit F-1 Form of Certificate of Foreign Clearing Agency
Exhibit F-2 Form of Alternate Certificate to be delivered to Foreign
Clearing Agency
Exhibit F-3 Form of Certificate to be delivered to Foreign Clearing Agency
Exhibit G-1 Private Placement Legend
Exhibit G-2 Representation Letter
Exhibit G-3 ERISA Legend
SCHEDULES
Schedule 1 List of Accounts Delivered to Trustee
POOLING AND SERVICING AGREEMENT, dated as of May 16, 1996, as
amended and restated as of April 16, 2004, among (i) AMERICAN EXPRESS
RECEIVABLES FINANCING CORPORATION II, a Delaware corporation, AMERICAN EXPRESS
RECEIVABLES FINANCING CORPORATION III LLC, a Delaware limited liability company,
and AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION IV LLC, a Delaware
limited liability company, as Transferors; (ii) AMERICAN EXPRESS TRAVEL RELATED
SERVICES COMPANY, INC., a New York corporation, as Servicer; and (iii) THE BANK
OF NEW YORK, a New York banking corporation, as Trustee.
Reference is made to that certain Pooling and Servicing
Agreement, dated as of May 16, 1996 (as amended and supplemented, the "Original
Pooling Agreement"), among American Express Receivables Financing Corporation II
and American Express Centurion Bank, as Transferors; American Express Travel
Related Services Company, Inc., as Servicer; and The Bank of New York, as
Trustee. The parties hereto wish to amend and restate the Original Pooling
Agreement in its entirety in order to, among other things, provide for the
addition of American Express Receivables Financing Corporation III LLC, a
Delaware limited liability company, and American Express Receivables Financing
Corporation IV LLC, a Delaware limited liability company, each as a Transferor
thereunder.
Therefore, in consideration of the mutual agreements herein
contained, each party agrees, for the benefit of the other parties, the
Certificateholders and any Series Enhancer (as defined below), to amend and
restate the Original Pooling Agreement in its entirety to read as follows:
ARTICLE I
DEFINITIONS
Section 1.01 Definitions. Whenever used in this Agreement, the
following words and phrases shall have the following meanings, and the
definitions of such terms are applicable to the singular as well as the plural
forms of such terms and to the masculine as well as to the feminine and neuter
genders of such terms.
"Account" shall mean (a) each Initial Account, (b) each
Additional Account (but only from and after the Addition Date with respect
thereto), (c) each Related Account and (d) each Transferred Account, but shall
exclude (e) any Account, all the Receivables of which are either (i) after the
Removal Date, removed by a Transferor pursuant to Section 2.10, (ii) reassigned
to a Transferor pursuant to Section 2.05 or (iii) assigned and transferred to
the Servicer pursuant to Section 3.03.
"Account Agreement" shall mean, with respect to an Account,
the agreement between an Account Owner 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.
"Account Owner" shall mean, with respect to an Account,
Centurion Bank, FSB or any other entity that, pursuant to the Account Agreement
related to such Account, is the issuer of the credit or charge cards related to,
or the owner of, such Account; provided that the Transferors shall notify
Standard & Poor's promptly following the designation of any Account Owner other
than Centurion Bank or FSB.
"Accumulation Period" shall mean, with respect to any Series,
or any Class within a Series, a period following the Revolving Period, which
shall be the controlled accumulation period, the principal accumulation period,
the rapid accumulation period, the optional accumulation period, the limited
accumulation period or other accumulation period, in each case as defined with
respect to such Series in the related Supplement.
"Act" shall mean the Securities Act of 1933, as amended.
"Addition Cut-Off Date" shall mean (a) with respect to
Aggregate Addition Accounts or Participation Interests, the date specified as
such in the notice delivered with respect thereto pursuant to subsection 2.09(c)
and (b) with respect to New Accounts, the later of the dates on which such New
Accounts are originated or designated pursuant to subsection 2.09(d).
"Addition Date" shall mean (a) with respect to Aggregate
Addition Accounts, the date from and after which such Aggregate Addition
Accounts are to be included as Accounts pursuant to subsection 2.09(a) or (b),
(b) with respect to Participation Interests, the date from and after which such
Participation Interests are to be included as assets of the Trust pursuant to
subsection 2.09(a) or (b), and (c) with respect to New Accounts, the first
Distribution Date following the calendar month in which such New Accounts are
originated or designated pursuant to subsection 2.09(a) or (b).
"Addition Selection Date" shall mean, for each Aggregate
Addition, the date specified as such in the notice delivered with respect
thereto pursuant to subsection 2.09(c).
"Additional Account" shall mean each New Account and each
Aggregate Addition Account.
"Additional Transferor" shall have the meaning specified in
subsection 2.09(g).
"Adjusted Invested Amount" shall mean, with respect to any
Series and for any date, an amount equal to the "Adjusted Invested Amount" as
specified in the related Supplement.
"Adverse Effect" shall mean, with respect to any action, that
such action will (a) result in the occurrence of a Pay-Out Event or a
Reinvestment Event or (b) materially adversely affect the amount or timing of
distributions to be made to the Investor Certificateholders of any Series or
Class pursuant to this Agreement and the related Supplement.
"Affiliate" shall mean, with respect to any specified Person,
any other Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" shall mean the
power to direct the management and policies of a Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
2
"Aggregate Addition" shall mean the designation of additional
Eligible Accounts, other than New Accounts, to be included as Accounts or of
Participation Interests to be included as Trust Assets pursuant to subsection
2.09(a) or (b).
"Aggregate Addition Account" shall mean each Eligible Account
designated pursuant to subsection 2.09(a) or (b) to be included as an Account
and identified in the computer file or microfiche list delivered to the Trustee
by a Transferor pursuant to Section 2.01 and subsection 2.09(h).
"Aggregate Invested Amount" shall mean, as of any date of
determination, the aggregate Adjusted Invested Amounts of all Series of
Certificates issued and outstanding on such date of determination.
"Agreement" shall mean the Original Pooling Agreement (i) with
respect to each Series, as supplemented by each related Supplement and (ii) as
amended by this Pooling and Servicing Agreement and as the same may be further
amended, supplemented or otherwise modified from time to time.
"American Express Credco" shall mean American Express Credit
Corporation, a Delaware corporation, and its successors and permitted assigns.
"Amortization Period" shall mean, with respect to any Series,
or any Class within a Series, a period following the Revolving Period, which
shall be the controlled amortization period, the principal amortization period,
the early amortization period, the optional amortization period, the limited
amortization period or other amortization period, in each case as defined with
respect to such Series in the related Supplement.
"Applicants" shall have the meaning specified in Section 6.08.
"Appointment Date" shall have the meaning specified in
subsection 9.02(a).
"Assignment" shall have the meaning specified in subsection
2.09(h).
"Authorized Newspaper" shall mean any newspaper or newspapers
of general circulation in the Borough of Manhattan, The City of New York,
printed in the English language (and, with respect to any Series or Class, if
and so long as the Investor Certificates of such Series are listed on the
Luxembourg Stock Exchange and such exchange shall so require, in Luxembourg,
printed in any language satisfying the requirements of such exchange) and
customarily published on each Business Day at such place, whether or not
published on Saturdays, Sundays or holidays.
"Average Rate," unless otherwise provided in any Supplement,
shall mean, as of any date of determination and with respect to any Group, the
percentage equivalent of a decimal equal to the sum of the amounts for each
outstanding Series (or each Class within any Series consisting of more than one
Class) within such Group obtained by multiplying (a) the Certificate Rate
(reduced to take into account the payments received pursuant to any interest
rate agreements net of any amounts payable under such agreements, or, if such
agreements result in a net amount payable, increased by such net amount payable)
for such Series or Class, by (b) a fraction, the numerator of which is the
aggregate unpaid principal amount of the Investor Certificates of such Series or
Class and the denominator of which is the aggregate unpaid principal amount of
all Investor Certificates within such Group.
3
"Bankruptcy Code" shall have the meaning specified in Section
7.02.
"Bearer Certificates" shall have the meaning specified in
Section 6.01.
"Benefit Plan" shall have the meaning specified in subsection
6.04(c).
"Book-Entry Certificates" shall mean Investor Certificates
that are registered in the name of a Clearing Agency or a Foreign Clearing
Agency, or the nominee of either such entity, ownership and transfers of which
shall be made through book entries by such Clearing Agency or Foreign Clearing
Agency as described in Section 6.10.
"Business Day" shall mean (i) any day other than (a) a
Saturday or Sunday or (b) any other day on which national banking associations
or state banking institutions in New York, New York, or any other State in which
the principal executive offices of Centurion Bank, FSB, the Trustee, or any
Account Owner, as the case may be, are located, are authorized or are obligated
by law, executive order or governmental decree to be closed or (c) for purposes
of any particular Series, any other day specified in the applicable Supplement
and (ii) with respect to the determination of LIBOR, a London Business Day (as
such term is defined in the related Supplement).
"Cash Advance Fees" shall mean cash advance transaction fees
and cash advance late fees, if any, as specified in any Account Agreement
applicable to an Account.
"Centurion Bank" shall mean American Express Centurion Bank, a
Utah-chartered industrial loan corporation, and its successors and permitted
assigns.
"Centurion Bank - RFC III Purchase Agreement" shall mean that
certain Receivables Purchase Agreement, dated as of April 16, 2004, between
Centurion Bank and RFC III, as the same may be, or may have been, amended,
supplemented or otherwise modified from time to time.
"Centurion Bank - RFC III Revolving Credit Agreement" shall
mean the Revolving Credit Agreement by and between Centurion Bank and RFC III,
dated as of April 16, 2004, as such agreement may be amended from time to time
in accordance therewith, or any substantially similar agreement entered into
between any lender and RFC III.
"Certificate" shall mean any one of the Investor Certificates
or the Transferor Certificates.
"Certificateholder" or "Holder" shall mean an Investor
Certificateholder or a Person in whose name any one of the Transferor
Certificates is registered.
"Certificateholders' Interest" shall have the meaning
specified in Section 4.01. For purposes of determining whether Holders of
Investor Certificates evidencing a specified percentage of the
Certificateholders' Interest have approved, consented or otherwise agreed to any
action hereunder, such determination shall be made based on the percentage of
the Invested Amount or Adjusted Invested Amount, as specified in the related
Supplement, represented by such Investor Certificates.
4
"Certificate Owner" shall mean, with respect to a Book-Entry
Certificate, the Person who is the owner of a security entitlement with respect
to such Book-Entry Certificate, as reflected on the books of the Clearing
Agency, or on the books of a Person maintaining an account with such Clearing
Agency (directly as a Clearing Agency Participant or as an indirect participant,
in accordance with the rules of such Clearing Agency).
"Certificate Rate" shall mean, as of any particular date of
determination and with respect to any Series or Class, the certificate rate as
of such date specified therefor in the related Supplement.
"Certificate Register" shall mean the register maintained
pursuant to Section 6.04, providing for the registration of the Registered
Certificates and transfers and exchanges thereof.
"Class" shall mean, with respect to any Series, any one of the
classes of Investor Certificates of that Series.
"Clearing Agency" shall mean an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended, and serving as clearing agency for a Series or Class of
Book-Entry Certificates.
"Clearing Agency Participant" shall mean a broker, dealer,
bank, other financial institution or other Person for whom from time to time a
Clearing Agency effects book-entry transfers and pledges of securities deposited
with the Clearing Agency.
"Clearstream" shall mean Clearstream Bank, societe anonyme, a
professional depository incorporated under the laws of Luxembourg, and any
successor thereto.
"Closing Date" shall mean, with respect to any Series, the
closing date specified in the related Supplement.
"Code" shall mean the Internal Revenue Code of 1986, as
amended.
"Collection Account" shall have the meaning specified in
Section 4.02.
"Collections" shall mean all payments by or on behalf of
Obligors (including Insurance Proceeds) received in respect of the Receivables,
in the form of cash, checks, wire transfers, electronic transfers, ATM transfers
or any other form of payment in accordance with the Account Agreement in effect
from time to time and all other amounts specified by this Agreement or any
Supplement as constituting Collections. As specified in any Participation
Interest Supplement, Collections shall include amounts received with respect to
Participation Interests. With respect to any Monthly Period, all Issuer Rate
Fees received with respect to the preceding Monthly Period and all Recoveries
with respect to Receivables previously charged-off as uncollectible will be
treated as Collections of Finance Charge Receivables.
5
"Commission" shall have the meaning specified in subsection
3.01(b).
"Companion Series" shall mean (i) each Series which has been
paired with another Series (which Series may be prefunded or partially
prefunded), such that the reduction of the Invested Amount or Adjusted Invested
Amount of such Series results in the increase of the Invested Amount or Adjusted
Invested Amount, respectively, of such other Series, as described in the related
Supplements, and (ii) such other Series.
"Corporate Trust Office" shall have the meaning specified in
Section 11.16.
"Coupon" shall have the meaning specified in Section 6.01.
"Credco-Centurion Bank Purchase Agreement" shall mean,
collectively, the Receivables Purchase Agreements, each dated as of October 1,
1987, between Centurion Bank and American Express Credco, as the same may be, or
may have been, amended, supplemented or otherwise modified from time to time.
"Credco-RFC II Purchase Agreement" shall mean that certain
Receivables Purchase Agreement, dated as of May 16, 1996, between American
Express Credco and RFC II, as the same may be, or may have been, amended,
supplemented or otherwise modified from time to time.
"Credit Guidelines" shall mean the respective policies and
procedures of Centurion Bank, FSB or any other Account Owner, as the case may
be, as such policies and procedures may be amended from time to time, (a)
relating to the operation of its credit or charge business, as the case may be,
which generally are applicable to its portfolio of similar accounts, including
the policies and procedures for determining the creditworthiness of customers
and the extension of credit or charge privileges to customers, and (b) relating
to the maintenance of accounts and collection of related receivables.
"Date of Processing" shall mean, with respect to any
transaction or receipt of Collections, the Business Day after such transaction
is first output, in written form under the Servicer's customary and usual
practices, from the Servicer's computer file of accounts comparable to the
Accounts (without regard to the effective date of recordation).
"Defaulted Account" shall mean any Account that has Defaulted
Receivables.
"Defaulted Amount" shall mean, with respect to any Monthly
Period, an amount (which shall not be less than zero) equal to (a) the amount of
Principal Receivables which became Defaulted Receivables in such Monthly Period,
minus (b) the amount of any Defaulted Receivables of which a Transferor or the
Servicer became obligated to accept reassignment or assignment in accordance
with the terms of this Agreement during such Monthly Period; provided, however,
that, if an Insolvency Event occurs with respect to any Transferor, the amount
of such Defaulted Receivables which are subject to reassignment to such
Transferor in accordance with the terms of this Agreement shall not be added to
the sum so subtracted and, if any of the events described in subsection 10.01(d)
occur with respect to the Servicer, the amount of such Defaulted Receivables
which are subject to assignment to the Servicer in accordance with the terms of
this Agreement shall not be added to the sum so subtracted.
6
"Defaulted Receivables" shall mean, with respect to any
Monthly Period, all Principal Receivables which are charged off as uncollectible
in such Monthly Period in accordance with the Credit Guidelines and the
Servicer's customary and usual servicing procedures for servicing accounts
comparable to the Accounts. A Principal Receivable shall become a Defaulted
Receivable on the Date of Processing on which such Principal Receivable is
recorded as charged-off on the Servicer's computer file of Accounts.
"Defeasance" shall have the meaning specified in subsection
12.04(a).
"Defeased Series" shall have the meaning specified in
subsection 12.04(a).
"Definitive Certificates" shall have the meaning specified in
Section 6.10.
"Definitive Euro-Certificates" shall have the meaning
specified in subsection 6.13(a).
"Deposit Date" shall mean each day on which the Servicer
deposits Collections in the Collection Account.
"Depository Agreement" shall mean, with respect to any Series
or Class of Book-Entry Certificates, the agreement among the Transferors, the
Trustee and the Clearing Agency substantially in the form attached to the
applicable Supplement.
"Determination Date" shall mean, unless otherwise specified in
the Supplement for a particular Series, the earlier of the third Business Day
and the fifth calendar day (or if the fifth calendar day is not a Business Day,
then the preceding Business Day) preceding each Distribution Date.
"Discount Option Date" shall mean each date on which a
Discount Percentage designated by the Transferors pursuant to Section 2.12 takes
effect.
"Discount Option Receivables" shall have the meaning specified
in Section 2.12. The aggregate amount of Discount Option Receivables outstanding
on any Date of Processing occurring on or after the Discount Option Date shall
equal the sum of (a) the aggregate Discount Option Receivables at the end of the
prior Date of Processing (which amount, prior to the Discount Option Date, shall
be zero) plus (b) any new Discount Option Receivables created on such Date of
Processing minus (c) any Discount Option Receivable Collections received on such
Date of Processing. Discount Option Receivables created on any Date of
Processing shall mean the product of the amount of any Principal Receivables
created on such Date of Processing (without giving effect to the proviso in the
definition of Principal Receivables) and the Discount Percentage.
"Discount Option Receivable Collections" shall mean on any
Date of Processing occurring in any Monthly Period succeeding the Monthly Period
in which the Discount Option Date occurs, the product of (a) the Discount
Percentage and (b) Collections of Principal Receivables on such Date of
Processing (without giving effect to the proviso in the definition of Principal
Receivables).
7
"Discount Percentage" shall mean the percentage, if any,
designated from time to time by the Transferors pursuant to Section 2.11.
"Distribution Date" shall mean, with respect to any Series,
the fifteenth day of each calendar month or, if such fifteenth day is not a
Business Day, the next succeeding Business Day, or the date otherwise specified
in the applicable Supplement for such Series.
"Dollars," "$" or "U.S. $" shall mean United States dollars.
"Eligible Account" shall mean a credit or charge account or
line of credit (if, with respect to the line of credit, the full receivable
balance is not due upon receipt of a monthly billing statement (excluding the
billing statement with respect to the final payment of such balance) and the
line of credit contains a code designation in the related securitization field
as described in Section 2.01) owned by Centurion Bank, in the case of the
Initial Accounts on the selection date related to its date of designation as an
"Account" under the Original Pooling Agreement, or Centurion Bank, FSB or any
other Account Owner, in the case of Additional Accounts, that, with respect to
an Initial Account, as of the selection date related to its date of designation
as an "Account" under the Original Pooling Agreement or, with respect to an
Additional Account, as of the Addition Selection Date, meets the following
requirements:
(a) is a credit or other charge account or line of credit (if,
with respect to the line of credit, the full receivable balance is not due upon
receipt of a monthly billing statement (excluding the billing statement with
respect to the final payment of such balance) and the line of credit contains a
code designation in the related securitization field as described in Section
2.01) in existence and maintained by Centurion Bank, FSB or such other Account
Owner, as the case may be;
(b) is payable in Dollars;
(c) has an Obligor that has not been confirmed by the Servicer
in its computer files as being involved in a voluntary or involuntary bankruptcy
proceeding;
(d) has an Obligor who has provided as his or her most recent
billing address an address located in the United States or its territories or
possessions or Canada or a United States military address; provided, however,
that as of any date of determination, up to 3% of the Accounts (calculated by
number of Accounts) may have Obligors who have provided as their billing
addresses, addresses located outside of such jurisdictions;
(e) if such account is a credit card or charge card account,
has not been identified as an account with respect to which a related card has
been lost or stolen;
(f) has not been sold or pledged to any other party except for
any other Account Owner that has either entered into (or, on or prior to the
Addition Date, will enter into) a Receivables Purchase Agreement or that is (or,
on or prior to the Addition Date, will be) a Transferor;
(g) does not have receivables that have been sold or pledged
by Centurion Bank, FSB or any other Account Owner, as the case may be, to any
Person other than American Express Credco or any Transferor; and
8
(h) does not have receivables that are Defaulted Receivables
or that have been identified by the Servicer as having been incurred as a result
of the fraudulent use of a related credit or charge card.
Notwithstanding the above requirements, Eligible Accounts may include accounts,
the receivables of which have been written off, or with respect to which the
Servicer has confirmed the related Obligor is bankrupt, in each case as of the
selection dates related to their date of designation as "Accounts" under the
Original Pooling Agreement, with respect to Initial Accounts, and as of the
related Addition Selection Date, with respect to Additional Accounts; provided
that (a) the balance of all receivables included in such accounts is reflected
on the books and records of the related Account Owner (and is treated for
purposes of this Agreement) as "zero," and (b) borrowing and charging privileges
with respect to all such accounts have been canceled in accordance with the
Credit Guidelines applicable thereto and will not be reinstated by the related
Account Owner or the Servicer.
"Eligible Deposit Account" shall mean either (a) a segregated
account with an Eligible Institution (other than any Account Owner) or (b) a
segregated trust account with the corporate trust department of a depository
institution (other than any Account Owner) organized under the laws of the
United States or any one of the states thereof, including the District of
Columbia (or any domestic branch of a foreign bank), and acting as a trustee for
funds deposited in such account, so long as any of the unsecured, unguaranteed
senior debt securities of such depository institution shall have a credit rating
from each Rating Agency in one of its generic credit rating categories that
signifies investment grade.
"Eligible Institution" shall mean the Trustee or any
depository institution organized under the laws of the United States, any one of
the states thereof or the District of Columbia (or any domestic branch of a
foreign bank), which depository institution at all times (a) is a member of the
FDIC and (b) has (i) a long-term unsecured debt rating acceptable to each Rating
Agency or (ii) a certificate of deposit rating acceptable to the Rating Agency.
Notwithstanding the previous sentence any institution the appointment of which
satisfies the Rating Agency Condition shall be considered an Eligible
Institution. If so qualified, the Servicer may be considered an Eligible
Institution for the purposes of this definition.
"Eligible Investments" shall mean negotiable instruments or
investment property, or, in the case of deposits described below, deposit
accounts held in the name of the Trustee in trust for the benefit of the
Certificateholders, subject to the exclusive custody and control of the Trustee
and for which the Trustee has sole signature authority, which evidence:
(a) direct obligations of, or obligations fully guaranteed as
to timely payment by, the United States of America;
(b) demand deposits, time deposits or certificates of deposit
(having original maturities of no more than 365 days) of depository institutions
or trust companies incorporated under the laws of the United States of America,
any state thereof or the District of Columbia (or domestic branches of foreign
banks) and subject to supervision and examination by federal or state banking or
depository institution authorities; provided that at the time of the Trust's
investment or contractual commitment to invest therein, the short-term debt of
such depository institution or trust company shall be rated at least "A-1+" by
Standard & Poor's (or any other rating from Standard & Poor's, subject to
receipt by the Transferors, the Servicer and the Trustee of written notification
from Standard & Poor's that investments of such type at such other rating will
not result in Standard & Poor's reducing or withdrawing its then existing rating
of the Certificates of any outstanding Series or Class with respect to which it
is a Rating Agency) and shall be satisfactory to each other Rating Agency;
9
(c) commercial paper (having original or remaining maturities
of no more than 30 days), that shall be rated, at the time of the Trust's
investment or contractual commitment to invest therein, at least "A-1+" by
Standard & Poor's (or any other rating from Standard & Poor's, subject to
receipt by the Transferors, the Servicer and the Trustee of written notification
from Standard & Poor's that investments of such type at such other rating will
not result in Standard & Poor's reducing or withdrawing its then existing rating
of the Certificates of any outstanding Series or Class with respect to which it
is a Rating Agency) and shall be satisfactory to each other Rating Agency;
(d) demand deposits, time deposits and certificates of deposit
which are fully insured by the FDIC having, at the time of the Trust's
investment therein, a rating satisfactory to the Rating Agency;
(e) bankers' acceptances (having original maturities of no
more than 365 days) issued by any depository institution or trust company
referred to in clause (b) above;
(f) time deposits (having maturities not later than the next
Transfer Date) other than as referred to in clause (b) above, with a Person the
commercial paper of which shall be rated at least "A-1+" by Standard & Poor's
(or any other rating from Standard & Poor's, subject to receipt by the
Transferors, the Servicer and the Trustee of written notification from Standard
& Poor's that investments of such type at such other rating will not result in
Standard & Poor's reducing or withdrawing its then existing rating of the
Certificates of any outstanding Series or Class with respect to which it is a
Rating Agency) and shall be satisfactory to each other Rating Agency;
(g) only to the extent permitted by Rule 3a-7 under the
Investment Company Act, (i) money market funds that shall be rated, at the time
of the Trust's investment therein, at least "AAA-m" or "AAAm-G" by Standard &
Poor's (or any other rating from Standard & Poor's, subject to receipt by the
Transferors, the Servicer and the Trustee of written notification from Standard
& Poor's that investments of such type at such other rating will not result in
Standard & Poor's reducing or withdrawing its then existing rating of the
Certificates of any outstanding Series or Class with respect to which it is a
Rating Agency) and in the highest rating category of each other Rating Agency
(including any such fund for which the Trustee or any Affiliate of the Trustee
is investment manager or advisor) or (ii) any other investment of a type or
rating that satisfies the Rating Agency Condition; or
10
(h) any other investments permitted by Rule 3a-7 of the
Investment Company Act and approved in writing by each Rating Agency;
provided that Eligible Investments shall not include securities issued by, or
other obligations of, any Account Owner; and provided further that no Eligible
Investments shall be contrary to the status of the Trust as a qualified special
purpose entity under existing accounting literature.
"Eligible Receivable" shall mean each Receivable:
(a) that has arisen in an Eligible Account;
(b) that was created in compliance in all material respects
with all Requirements of Law applicable to the Account Owner of such Eligible
Account and pursuant to an Account Agreement that complies in all material
respects with all Requirements of Law applicable to such Account Owner, in
either case, the failure to comply with which would have an Adverse Effect;
(c) with respect to which all material consents, licenses,
approvals or authorizations of, or registrations or declarations with, any
Governmental Authority required to be obtained, effected or given in connection
with the creation of such Receivable or the execution, delivery and performance
by such Account Owner of the Account Agreement pursuant to which such Receivable
was created, have been duly obtained, effected or given and are in full force
and effect;
(d) as to which at the time of the transfer of such Receivable
to the Trust, a Transferor or the Trust will have good and marketable title
thereto, free and clear of all Liens (other than any Lien for municipal or other
local taxes of a Transferor or an Account Owner if such taxes are not then due
and payable or if such Transferor or such Account Owner is then contesting the
validity thereof in good faith by appropriate proceedings and has set aside on
its books adequate reserves with respect thereto);
(e) that has been the subject of either a valid transfer and
assignment from a Transferor to the Trust of all such Transferor's right, title
and interest therein (including any proceeds thereof), or the grant of a
first-priority perfected security interest therein (and in the proceeds
thereof), effective until the termination of the Trust;
(f) that 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);
(g) that, at the time of transfer to the Trust, has not been
waived or modified except as permitted in accordance with the Credit Guidelines
and which waiver or modification is reflected in the Servicer's computer file of
accounts;
11
(h) that, at the time of transfer to the Trust, is not subject
to any right of rescission, setoff, counterclaim or any other defense (including
defenses arising out of violations of usury laws) of the Obligor, other than
defenses arising out of applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the enforcement of creditors' rights
in general;
(i) as to which, at the time of transfer to the Trust, the
Transferor thereof has satisfied all its obligations required to be satisfied by
such time;
(j) as to which, at the time of transfer to the Trust, none of
the Transferors, Centurion Bank, FSB, any other Account Owner or American
Express Credco, as the case may be, has taken any action which would impair, or
omitted to take any action the omission of which would impair, the rights of the
Trust or the Certificateholders therein; and
(k) that constitutes either an "account" or a "general
intangible" under and as defined in Article 9 of the UCC as then in effect in
any state where the filing of a financing statement is then required to perfect
the Trust's interest in the Receivables and the proceeds thereof.
"Eligible Servicer" shall mean the Trustee, TRS or Centurion
Bank or, if the Trustee, TRS or Centurion Bank is not acting as Servicer, an
entity, the appointment of which shall satisfy the Rating Agency Condition, or
an entity that, at the time of its appointment as Servicer, (a) is servicing a
portfolio of credit accounts, (b) is legally qualified and has the capacity to
service the Accounts, (c) in the sole determination of the Trustee, which
determination shall be conclusive and binding, has demonstrated the ability to
service professionally and competently a portfolio of similar accounts in
accordance with high standards of skill and care, (d) is qualified to use the
software that is then being used 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 (e) has a net worth of at least $50,000,000 as of the end of its
most recent fiscal quarter.
"Enhancement Agreement" shall mean any agreement, instrument
or document governing the terms of any Series Enhancement or pursuant to which
any Series Enhancement is issued or outstanding.
"ERISA" shall mean the Employee Retirement Income Security Act
of 1974, as amended.
"Euroclear Operator" shall mean Euroclear Bank S.A. / N.V., as
operator of the Euroclear System, and any successor thereto.
"Excess Allocation Series" shall mean any Series that,
pursuant to the Supplement related to such Series, is entitled to receive
certain excess Collections of Finance Charge Receivables as more fully described
in such Supplement.
"Exchange Date" shall mean, with respect to any Series, any
date that is after the related Closing Date, in the case of Definitive
Euro-Certificates in registered form, or upon presentation of certification of
non-United States beneficial ownership (as described in Section 6.13), in the
case of Definitive Euro-Certificates in bearer form.
12
"FDIC" shall mean the Federal Deposit Insurance Corporation or
any successor.
"Finance Charge Receivables" shall mean all amounts billed to
the Obligors on any Account in respect of (i) all Periodic Rate Finance Charges,
(ii) Cash Advance Fees, (iii) annual membership fees and annual service charges,
(iv) Late Fees, (v) Overlimit Fees, (vi) Discount Option Receivables, if any,
and (vii) any other fees with respect to the Accounts designated by the
Transferors at any time and from time to time to be included as Finance Charge
Receivables; provided, however, that after the Premium Option Date, Finance
Charge Receivables on any Date of Processing shall mean the amount of Finance
Charge Receivables as otherwise determined pursuant to this definition less the
amount of Premium Option Receivables. Finance Charge Receivables shall also
include (a) the interest portion of Participation Interests as shall be
determined pursuant to, and only if so provided in, the applicable Participation
Interest Supplement or Series Supplement, (b) any amounts designated to be
Finance Charge Receivables pursuant to Section 4.05, (c) all Recoveries with
respect to Receivables previously charged off as uncollectible and (d) the
Issuer Rate Fees received with respect to the related Monthly Period.
"Foreign Clearing Agency" shall mean Clearstream and the
Euroclear Operator.
"FSB" shall mean American Express Bank, FSB, a federal savings
bank, and its successors and permitted assigns.
"FSB - RFC IV Purchase Agreement" shall mean that certain
Receivables Purchase Agreement, dated as of April 16, 2004, between FSB and RFC
IV, as the same may be, or may have been, amended, supplemented or otherwise
modified from time to time.
"FSB - RFC IV Revolving Credit Agreement" shall mean the
Revolving Credit Agreement by and between FSB and RFC IV, dated as of April 16,
2004, as such agreement may be amended from time to time in accordance
therewith, or any substantially similar agreement entered into between any
lender and RFC IV.
"Global Certificate" shall have the meaning specified in
subsection 6.13(a).
"Governmental Authority" shall mean the United States of
America, any state or other political subdivision thereof and any entity
exercising executive, legislative, judicial, regulatory or administrative
functions of or pertaining to government.
"Group" shall mean, with respect to any Series, the group of
Series, if any, in which the related Supplement specifies such Series is to be
included.
"Independent Director" shall have the meaning specified in
subsection 2.07(h)(vii).
13
"Ineligible Receivables" shall have the meaning specified in
subsection 2.05(a).
"Initial Account" shall mean each Optima(R) Card, Optima Line
of Credit and Sign and Travel(R) credit account established pursuant to an
Account Agreement between Centurion Bank or other Account Owner and any Person,
which account is identified in the computer file or microfiche list delivered to
the Trustee by the Transferors pursuant to Section 2.01 on the Substitution
Date.
"Initial Cut-Off Date" shall mean the close of business on
April 16, 2004.
"Insolvency Event" shall have the meaning specified in
subsection 9.01(a).
"Insolvency Proceeds" shall have the meaning specified in
subsection 9.01(b).
"Insurance Proceeds" shall mean all Insurance Proceeds as
defined in the related Receivables Purchase Agreement that are paid to a
Transferor as provided in the related Receivables Purchase Agreement.
"Invested Amount" shall mean, with respect to any Series and
for any date, an amount equal to the "Invested Amount," as specified in the
related Supplement.
"Investment Company Act" shall mean the Investment Company Act
of 1940, as amended.
"Investor Certificateholder" shall mean the Person in whose
name a Registered Certificate is registered in the Certificate Register or the
bearer of any Bearer Certificate (or the Global Certificate, as the case may be)
or Coupon.
"Investor Certificates" shall mean any certificated or
uncertificated interest in the Trust designated as, or deemed to be, an
"Investor Certificate" in the related Supplement.
"Issuer Rate Fees" shall mean issuer rate fees paid to a
Transferor pursuant to the related Receivables Purchase Agreement.
"Late Fees" shall have the meaning specified in the Account
Agreement applicable to each Account for late fees or similar terms.
"LIBOR" for any Series shall have the meaning specified in the
Supplement related to such Series.
"Lien" shall mean any security interest, mortgage, deed of
trust, pledge, hypothecation, assignment, deposit arrangement, equity interest,
encumbrance, lien (statutory or other), preference, participation interest,
priority or other security agreement or preferential arrangement of any kind or
nature whatsoever, including any conditional sale or other title retention
agreement, or any financing lease having substantially the same economic effect
as any of the foregoing; provided, however, that any assignment permitted by
Section 7.02 or 7.05 and the lien created by this Agreement, the Original
Pooling Agreement or any Receivables Purchase Agreement shall not be deemed to
constitute a Lien.
14
"Manager" shall mean the lead manager, manager or co-manager
or Person performing a similar function with respect to an offering of
Definitive Euro-Certificates.
"Monthly Period" shall mean, with respect to each Distribution
Date, unless otherwise provided in a Supplement, the period (i) from and
including the second day following the last day of the seventh billing cycle
applicable to the Accounts ending during the second preceding calendar month and
(ii) to and including the day following the last day of the seventh billing
cycle applicable to the Accounts ending in the calendar month immediately
preceding the calendar month in which such Distribution Date shall occur;
provided, however, that the initial Monthly Period with respect to any Series
will commence on the Closing Date with respect to such Series.
"Moody's" shall mean Xxxxx'x Investors Service, Inc., or its
successor.
"New Account" shall mean each Optima Card(R), Optima Line of
Credit and Sign & Travel(R) account or other credit or charge account or line of
credit (if, with respect to the line of credit, the full receivable balance is
not due upon receipt of a monthly billing statement (excluding the billing
statement with respect to the final payment of such balance) established
pursuant to an Account Agreement, which account or line of credit is designated
pursuant to subsection 2.09(d) to be included as an Account and is identified in
the computer file or microfiche list delivered to the Trustee by the Transferors
pursuant to Section 2.01 and subsection 2.09(h).
"Notices" shall have the meaning specified in subsection
13.05(a).
"Obligor" shall mean, with respect to any Account, the Person
or Persons obligated to make payments with respect to such Account, including
any guarantor thereof, but excluding any merchant.
"Officer's Certificate" shall mean, unless otherwise specified
in this Agreement, a certificate signed by the President, any Vice President or
the Treasurer of a Transferor or the Servicer, as the case may be, or by the
President, any Vice President or the financial controller (or an officer holding
an office with equivalent or more senior responsibilities) of a Successor
Servicer.
"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.
"Original Pooling Agreement" shall have the meaning specified
in the Recitals to this Agreement.
"Original Transferor Certificate" shall mean the certificate
executed by Centurion Bank and RFC II and authenticated by or on behalf of the
Trustee, substantially in the form of Exhibit A, as the same may be modified in
accordance with Exhibit A.
"Overlimit Fees" shall have the meaning specified in the
Account Agreement applicable to each Account for overlimit fees or similar terms
if such fees are provided for with respect to such Account.
15
"Partial Amortization SFA Amounts" shall mean the amounts
specified by the Transferors pursuant to Section 4.02 which are to be applied to
the partial amortization of each Series as specified in the related Supplement.
"Participation Interest Supplement" shall mean a Supplement
entered into pursuant to subsection 2.09(a)(ii) or (b) in connection with the
conveyance of Participation Interests to the Trust.
"Participation Interests" shall have the meaning specified in
subsection 2.09(a)(ii).
"Paying Agent" shall mean any paying agent appointed pursuant
to Section 6.07 and shall initially be the Trustee; provided that if the
Supplement for a Series so provides, a separate or additional Paying Agent may
be appointed with respect to such Series.
"Pay-Out Event" shall mean, with respect to any Series, any
Pay-Out Event specified in the Supplement related to such Series.
"Periodic Rate Finance Charges" shall have the meaning
specified in the Account Agreement applicable to each Account for finance
charges (due to periodic rate) or any similar term.
"Permitted Activities" means the primary activities of the
Trust, which are:
(a) holding Receivables transferred from the Transferors and
the other assets of the Trust, including passive derivative
financial instruments that pertain to beneficial interests issued or
sold to parties other than the Transferors, their Affiliates or
their agents;
(b) issuing Certificates and other interests in the Trust
Assets;
(c) receiving Collections and making payments on such
Certificates and interests in accordance with the terms of this
Agreement and any Supplement; and
(d) engaging in other activities that are necessary or
incidental to accomplish these limited purposes, which activities
cannot be contrary to the status of the Trust as a qualified special
purpose entity under existing accounting literature.
"Person" shall mean any person or entity, including any
individual, corporation, limited liability company, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization,
governmental entity or other entity of similar nature.
"Portfolio Yield" shall mean with respect to the Trust as a
whole and, with respect to any Monthly Period, the annualized percentage
equivalent of a fraction (a) the numerator of which is the aggregate of the sum
of the Series Allocable Finance Charge Collections for all Series during the
immediately preceding Monthly Period calculated on a cash basis, after
subtracting therefrom the Series Allocable Defaulted Amounts for all Series with
respect to such Monthly Period and (b) the denominator of which is the total
amount of Principal Receivables plus (without duplication) the then outstanding
principal amount of any Participation Interests conveyed to the Trust, plus the
amount of funds on deposit in the Special Funding Account, in each case, as of
the last day of the immediately preceding Monthly Period; provided that, with
respect to any Monthly Period in which an Aggregate Addition occurs or a removal
of Accounts pursuant to Section 2.10 occurs, the amount of Principal Receivables
and Participation Interests referred to in clause (b) shall be the average
amount of Principal Receivables and Participation Interests in the Trust on each
Business Day during such Monthly Period based upon the assumptions that (1) the
aggregate amount of Principal Receivables in the Trust plus the then outstanding
principal amount of any Participation Interests conveyed to the Trust at the end
of the day on the last day of the prior Monthly Period is the aggregate amount
of Principal Receivables and Participation Interests in the Trust on each
Business Day of the period from and including the first day of such Monthly
Period to but excluding the related Addition Date or Removal Date and (2) the
aggregate amount of Principal Receivables in the Trust plus the then outstanding
principal amount of any Participation Interests conveyed to the Trust at the end
of the day on the related Addition Date or Removal Date is the aggregate amount
of Principal Receivables and Participation Interests in the Trust on each
Business Day of the period from and including the related Addition Date or
Removal Date to and including the last day of such Monthly Period.
16
"Premium Option Date" shall mean each date on which a Premium
Percentage designated by the Transferors pursuant to Section 2.13 takes effect.
"Premium Option Receivables" shall have the meaning specified
in Section 2.13. The aggregate amount of Premium Option Receivables outstanding
on any Date of Processing occurring on or after the Premium Option Date shall
equal the sum of (a) the aggregate Premium Option Receivables at the end of the
prior Date of Processing (which amount, prior to the Premium Option Date, shall
be zero) plus (b) any new Premium Option Receivables created on such Date of
Processing minus (c) any Premium Option Receivable Collections received on such
Date of Processing. Premium Option Receivables created on any Date of Processing
shall mean the product of the amount of any Finance Charge Receivables created
on such Date of Processing (without giving effect to the proviso in the
definition of Finance Charge Receivables) and the Premium Percentage.
"Premium Option Receivable Collections" shall mean on any Date
of Processing occurring in any Monthly Period succeeding the Monthly Period in
which the Premium Option Date occurs, the product of (a) the Premium Percentage
and (b) Collections of Finance Charge Receivables on such Date of Processing
(without giving effect to the proviso in the definition of Finance Charge
Receivables).
"Premium Percentage" shall mean the percentage, if any,
designated from time to time by the Transferors pursuant to Section 2.13.
"Principal Receivables" shall mean (i) all amounts charged by
Obligors for merchandise and services and cash advances or otherwise borrowed by
such Obligors under any line of credit existing under an Account, but shall not
include Finance Charge Receivables or Defaulted Receivables plus (ii) Premium
Option Receivables, if any; provided, however, that after the Discount Option
Date, Principal Receivables on any Date of Processing thereafter shall mean
Principal Receivables as otherwise determined pursuant to this definition minus
the amount of any Discount Option Receivables. Principal Receivables shall also
include the principal portion of Participation Interests as shall be determined
pursuant to, and only if so provided in, the applicable Participation Interest
Supplement or Series Supplement. 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 Principal Receivables which a Transferor is unable to transfer as provided
in Section 2.11 shall not be included in calculating the amount of Principal
Receivables.
17
"Principal Shortfalls" shall have the meaning specified in
Section 4.04.
"Principal Sharing Series" shall mean a Series that, pursuant
to the Supplement therefor, is entitled to receive Shared Principal Collections.
"Principal Terms" shall mean, with respect to any Series, (i)
the name or designation; (ii) the initial principal amount (or method for
calculating such amount), the Invested Amount, the Series Invested Amount and
the Required Series Transferor Amount; (iii) the Certificate Rate (or method for
the determination thereof); (iv) the payment date or dates and the date or dates
from which interest shall accrue; (v) the method for allocating Collections to
Investor Certificateholders; (vi) the designation of any Series Accounts and the
terms governing the operation of any such Series Accounts; (vii) the Servicing
Fee; (viii) the issuer and terms of any form of Series Enhancements with respect
thereto; (ix) the terms on which the Investor Certificates of such Series may be
exchanged for Investor Certificates of another Series, repurchased by a
Transferor or remarketed to other investors; (x) the Series Termination Date;
(xi) the number of Classes of Investor Certificates of such Series and, if more
than one Class, the rights and priorities of each such Class; (xii) the extent
to which the Investor Certificates of such Series will be issuable in temporary
or permanent global form (and, in such case, the depositary for such global
certificate or certificates, the terms and conditions, if any, upon which such
global 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); (xiii) whether the Investor Certificates of
such Series may be issued in bearer form and any limitations imposed thereon;
(xiv) the priority of such Series with respect to any other Series; (xv) whether
such Series will be part of a Group; (xvi) whether such Series will be a
Principal Sharing Series; (xvii) whether such Series will be an Excess
Allocation Series; (xviii) the Distribution Date; and (xix) any other terms of
such Series.
"Rating Agency" shall mean, with respect to any outstanding
Series or Class, each rating agency, as specified in the applicable Supplement,
selected by the Transferors to rate the Investor Certificates of such Series or
Class.
"Rating Agency Condition" shall mean, with respect to any
action, that each Rating Agency shall have notified the Transferors, the
Servicer and the Trustee in writing that such action will not result in a
reduction or withdrawal of the then existing rating of any outstanding Series or
Class with respect to which it is a Rating Agency.
"Reassignment" shall have the meaning specified in Section
2.10.
18
"Receivables" shall mean all amounts shown on the Servicer's
records as amounts payable by Obligors on any Account from time to time,
including amounts payable for Principal Receivables and Finance Charge
Receivables. Receivables that become Defaulted Receivables will cease to be
included as Receivables as of the day on which they become Defaulted
Receivables.
"Receivables Purchase Agreements" shall mean (i) the FSB - RFC
IV Purchase Agreement, (ii) the Centurion Bank - RFC III Purchase Agreement,
(iii) the Credco - RFC II Purchase Agreement, (iv) the Credco - Centurion Bank
Purchase Agreement and (v) any other receivables purchase agreement
substantially in the form of any such agreement that may be entered into by RFC
II, RFC III, RFC IV or an Additional Transferor and an Account Owner in the
future, pursuant to which RFC II, RFC III, RFC IV or such Additional Transferor
will acquire from such Account Owner Receivables for transfer, directly or
indirectly, to the Trustee on behalf of the Trust, in each case, as the same may
be amended, supplemented or otherwise modified from time to time.
"Record Date" shall mean, with respect to any Distribution
Date, the last day of the calendar month immediately preceding such Distribution
Date unless otherwise specified for a Series in the applicable Supplement.
"Recoveries" shall mean all Recoveries as defined in the
related Receivables Purchase Agreement that are paid to a Transferor as provided
in the related Receivables Purchase Agreement.
"Registered Certificateholder" shall mean the Holder of a
Registered Certificate.
"Registered Certificates" shall have the meaning specified in
Section 6.01.
"Reinvestment Event" shall mean, with respect to any Series,
the meaning specified in the Supplement related to such Series.
"Reinvestment Period" shall mean, if applicable, with respect
to any Series, any Reinvestment Event specified in the Supplement related to
such Series.
"Related Account" shall mean an Account with respect to which
a new account number has been issued by the applicable Account Owner or the
Servicer (i) resulting from a lost or stolen credit or charge card relating to
such Account (if such Account is a credit or charge card account) or (ii)
under circumstances not requiring the standard application and credit evaluation
procedures under the Credit Guidelines applicable to such Account, and (b) that
can be traced or identified by reference to or by way of Schedule 1 to this
Agreement and the computer or other records of the applicable Account Owner or
the Servicer.
"Removal Date" shall have the meaning specified in Section
2.10.
"Removed Accounts" shall have the meaning specified in Section
2.10.
"Removed Participation Interests" shall have the meaning
specified in Section 2.10.
19
"Required Designation Date" shall have the meaning specified
in subsection 2.09(a).
"Required Minimum Principal Balance" shall mean, with respect
to any date (a) the sum of the Series Invested Amounts for each Series
outstanding on such date plus the sum of the Series Required Transferor Amounts
for each Series outstanding on such date, minus (b) the Special Funding Amount.
"Required Transferor Amount" shall mean, with respect to any
date, an amount equal to the product of (A) the Required Transferor Percentage
and (B) the aggregate amount of Principal Receivables.
"Required Transferor Percentage" shall mean 7% or any other
percentage specified in any Supplement; provided, however, that the Transferors
may reduce the Required Transferor Percentage upon (x) 30 days' prior notice to
the Trustee and each Rating Agency, (y) satisfaction of the Rating Agency
Condition with respect thereto and (z) delivery to the Trustee of a certificate
of a Vice President or more senior officer of each Transferor stating that such
Transferor reasonably believes that such reduction will not, based on the facts
known to such officer at the time of such certification, then or thereafter have
an Adverse Effect; provided further that the Required Transferor Percentage
shall not at any time be less than 2%.
"Requirements of Law" shall mean any law, treaty, rule or
regulation, or determination of an arbitrator or Governmental Authority, whether
Federal, state or local (including, without limitation, usury laws, the Federal
Truth in Lending Act and Regulation B and Regulation Z of the Board of Governors
of the Federal Reserve System), and, when used with respect to any Person, the
certificate of incorporation and by-laws or other organizational or governing
documents of such Person.
"Responsible Officer" shall mean, when used with respect to
the Trustee, any officer within the Corporate Trust Administration Department
(or any successor group) of the Trustee, including any vice president, assistant
vice president, trust officer or any other officer of the Trustee customarily
performing functions similar to those performed by the persons who at the time
shall be such officers or to whom any corporate trust matter is referred at the
Corporate Trust Office because of such officer's knowledge of and familiarity
with the particular subject.
"Revolving Credit Agreements" shall mean (i) the Centurion
Bank - RFC III Revolving Credit Agreement and (ii) the FSB - RFC IV Revolving
Credit Agreement, in each case, as the same may be amended, supplemented or
otherwise modified from time to time.
"Revolving Period" shall mean, with respect to any Series, the
period specified as such in the Supplement related to such Series.
"RFC II" shall mean American Express Receivables Financing
Corporation II, a Delaware corporation, and its successors and permitted
assigns.
"RFC III" shall mean American Express Receivables Financing
Corporation III LLC, a Delaware limited liability company, and its successors
and permitted assigns.
20
"RFC IV" shall mean American Express Receivables Financing
Corporation IV LLC, a Delaware limited liability company, and its successors and
permitted assigns.
"Series" shall mean any series of Investor Certificates issued
pursuant to Section 6.03.
"Series Account" shall mean any deposit, securities, trust,
escrow or similar account maintained for the benefit of the Investor
Certificateholders of any Series or Class, as specified in any Supplement.
"Series Adjusted Invested Amount" shall mean, with respect to
any Series and for any Monthly Period, the Series Invested Amount of such
Series, after subtracting therefrom the excess, if any, of the cumulative amount
(calculated in accordance with the terms of the related Supplement) of investor
charge-offs, subordination of principal collections and funding of the investor
default amount for any other Class of Investor Certificates of such Series or
another Series allocable to the Invested Amount for such Series as of the last
day of the immediately preceding Monthly Period over the aggregate reimbursement
of such investor charge-offs, subordination of principal collections and funding
of the investor default amount for any other Class of Investor Certificates of
such Series or another Series as of such last day, or such lesser amount as may
be provided in the Supplement for such Series.
"Series Allocable Defaulted Amount" shall mean, with respect
to any Series and for any Monthly Period, the product of the Series Allocation
Percentage and the Defaulted Amount with respect to such Monthly Period.
"Series Allocable Finance Charge Collections" shall mean, with
respect to any Series and for any Monthly Period, the product of the Series
Allocation Percentage and the amount of Collections of Finance Charge
Receivables deposited in the Collection Account for such Monthly Period.
"Series Allocable Principal Collections" shall mean, with
respect to any Series and for any Monthly Period, the product of the Series
Allocation Percentage and the amount of Collections of Principal Receivables
deposited in the Collection Account for such Monthly Period.
"Series Allocation Percentage" shall mean, with respect to any
Series and for any Monthly Period, the percentage equivalent of a fraction, the
numerator of which is the Series Adjusted Invested Amount and the denominator of
which is the Trust Adjusted Invested Amount.
"Series Enhancement" shall mean the rights and benefits
provided to the Trust or the Investor Certificateholders of any Series or Class
pursuant to any letter of credit, surety bond, insurance policy, cash collateral
guaranty, subordinated interest in the Trust Assets, cash collateral account,
collateral interest, spread account, guaranteed rate agreement, maturity
liquidity facility, tax protection agreement, interest rate swap agreement,
interest rate cap agreement or other similar arrangement. The subordination of
any Series or Class to another Series or Class shall be deemed to be a Series
Enhancement.
21
"Series Enhancer" shall mean the Person or Persons providing
any Series Enhancement, other than (except to the extent otherwise provided with
respect to any Series in the Supplement for such Series) the Investor
Certificateholders of any Series or Class which is subordinated to another
Series or Class.
"Series Invested Amount" shall have, with respect to any
Series, the meaning specified in the related Supplement.
"Series Issuance Date" shall mean, with respect to any Series,
the date on which the Investor Certificates of such Series are to be originally
issued in accordance with Section 6.03 and the related Supplement.
"Series Required Transferor Amount" shall have the meaning,
with respect to any Series, as specified in the related Supplement.
"Series Termination Date" shall mean, with respect to any
Series, the termination date for such Series specified in the related
Supplement.
"Service Transfer" shall have the meaning specified in Section
10.01.
"Servicer" shall mean TRS, in its capacity as Servicer
pursuant to this Agreement, and, after any Service Transfer, the Successor
Servicer.
"Servicer Default" shall have the meaning specified in Section
10.01.
"Servicing Fee" shall mean, with respect to any Series, the
servicing fee specified in the related Supplement.
"Servicing Officer" shall mean any officer of the Servicer or
an attorney-in-fact of the Servicer who in either case is involved in, or
responsible for, the administration and servicing of the Receivables and whose
name appears on a list of servicing officers furnished to the Transferors and
the Trustee by the Servicer, as such list may from time to time be amended.
"Shared Principal Collections" shall have the meaning
specified in Section 4.04.
"Small Balances" shall have the meaning established in
accordance with the Credit Guidelines.
"Special Funding Account" shall have the meaning set forth in
Section 4.02.
"Special Funding Amount" shall mean the amount on deposit in
the Special Funding Account.
"Standard & Poor's" shall mean Standard & Poor's Ratings
Services or its successor.
"Substitution Date" shall mean the close of business on April
16, 2004.
"Successor Servicer" shall have the meaning specified in
subsection 10.02(a).
22
"Supplement" shall mean, with respect to any Series, a
supplement to this Agreement, executed and delivered in connection with the
original issuance of the Investor Certificates of such Series pursuant to
Section 6.03, and, with respect to any Participation Interest, an amendment to
this Agreement executed pursuant to Section 13.01, and, in either case,
including all amendments thereof and supplements thereto.
"Supplemental Certificate" shall have the meaning specified in
Section 6.03.
"Tax Opinion" shall mean, with respect to any action, an
Opinion of Counsel to the effect that, for federal income tax purposes, (a) such
action will not adversely affect the tax characterization as debt of the
Investor Certificates of any outstanding Series or Class that was characterized
as debt at the time of its issuance, (b) following such action the Trust will
not be deemed to be an association (or publicly traded partnership) taxable as a
corporation, (c) such action will not cause or constitute an event in which gain
or loss would be recognized by any Investor Certificateholder and (d) except as
is otherwise provided in a Supplement, in the case of Section 6.03(b)(vi), the
Investor Certificates of the Series established pursuant to such Supplement will
be properly characterized as debt.
"Termination Notice" shall have the meaning specified in
Section 10.01.
"Termination Proceeds" shall have the meaning specified in
subsection 12.02(c).
"Transfer Agent and Registrar" shall have the meaning
specified in Section 6.04.
"Transfer Date" shall mean the Business Day immediately
preceding each Distribution Date.
"Transfer Restriction Event" shall have the meaning specified
in Section 2.10.
"Transferor Amount" shall mean on any date of determination an
amount equal to (I) the sum of (A) the aggregate balance of Principal
Receivables at the end of the day immediately prior to such date of
determination and (B) the Special Funding Amount at the end of the day
immediately prior to such date of determination minus (II) the Aggregate
Invested Amount at the end of such day.
"Transferor Certificates" shall mean, collectively, the
Original Transferor Certificate and any outstanding Supplemental Certificates.
"Transferors" shall mean (a) prior to the Substitution Date,
Centurion Bank and RFC II and (b) on and after the Substitution Date, (i) RFC
II, RFC III and RFC IV and (ii) any Additional Transferor or Transferors.
References to "each Transferor" shall refer to each entity mentioned in the
preceding sentence and, whenever the context may so require, references to "the
Transferor" shall refer, collectively, to all of such entities.
"Transferors' Interest" shall have the meaning specified in
Section 4.01.
"Transferred Account" shall mean each credit or charge account
or line of credit (if, with respect to the line of credit, the full receivable
balance is not due upon receipt of a monthly billing statement (excluding the
billing statement with respect to the final payment of such balance) and the
line of credit contains a code designation as described in Article II) into
which an Account shall be transferred provided that (i) such transfer was made
in accordance with the Credit Guidelines and (ii) it can be traced or identified
in the applicable Transferor's or Account Owner's computer files with the code
identified in Article II or in the applicable Assignment as a Transferred
Account into which an Account has been transferred by reference to or by way of
the computer files or microfiche lists delivered to the Trustee pursuant to
Article II.
23
"TRS" shall mean American Express Travel Related Services
Company, Inc., a New York corporation, and its successors and permitted assigns.
"TRS Insolvency Event" shall mean any of the following events:
(i) the consent by TRS to, or the failure by TRS to object to, the appointment
of a bankruptcy trustee or conservator, receiver or liquidator in any bankruptcy
proceeding or other insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to TRS or all or substantially
all of TRS' property; (ii) the entering of a decree or order by a court or
agency or supervisory authority having jurisdiction in the premises for the
appointment of a bankruptcy trustee or conservator, receiver or liquidator in
any insolvency, readjustment of debt, marshalling of assets and liabilities or
similar proceedings, or for the winding-up, insolvency, bankruptcy,
reorganization, conservatorship, receivership or liquidation of TRS' affairs,
which decree or order shall have remained in force undischarged or unstayed for
a period of 60 days; (iii) TRS' inability, or the admission by TRS in writing of
TRS' inability, to pay its debts generally as its debts become due; (iv) the
filing of any petition, the effect of which would cause TRS to take advantage of
any applicable bankruptcy, insolvency or reorganization, receivership or
conservatorship statute; (v) the making by TRS of an assignment for the benefit
of TRS' creditors; (vi) the voluntary suspension by TRS of the payment of TRS'
obligations; or (vii) the consent by TRS to, or the failure of TRS to object to,
the filing of any petition described in clause (iv) above, or, if TRS shall have
objected to the filing of any such petition, the failure of such petition to
have been dismissed within 60 days of the filing thereof.
"Trust" shall mean the American Express Credit Account Master
Trust, the trust heretofore created and continued by this Agreement.
"Trust Adjusted Invested Amount" shall mean, with respect to
any Monthly Period, the aggregate Series Adjusted Invested Amounts as adjusted
in any Supplement for all outstanding Series for such Monthly Period.
"Trust Assets" shall have the meaning specified in Section
2.01.
"Trust Excess Principal Collections" shall have the meaning
specified in the applicable Supplement.
"Trustee" shall mean The Bank of New York, a New York banking
corporation, in its capacity as trustee on behalf of the Trust, or its successor
in interest, or any successor trustee appointed as herein provided.
"UCC" shall mean the Uniform Commercial Code, as amended from
time to time, as in effect in any specified jurisdiction.
24
Section 1.02 Other Definitional Provisions.
(a) With respect to any Series, all terms used herein and not
otherwise defined herein shall have meanings ascribed to them in the related
Supplement.
(b) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(c) As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
defined in this Agreement or in any such certificate or other document, and
accounting terms partly defined in this Agreement or in any such certificate or
other document to the extent not defined, shall have the respective meanings
given to them under generally accepted accounting principles as in effect on the
date of this Agreement. To the extent that the definitions of accounting terms
in this Agreement or in any such certificate or other document are inconsistent
with the meanings of such terms under generally accepted accounting principles
or regulatory accounting principles in the United States, the definitions
contained in this Agreement or in any such certificate or other document shall
control.
(d) The agreements, representations and warranties of RFC II,
RFC III, RFC IV and TRS in this Agreement in each of their respective capacities
as Transferor and Servicer shall be deemed to be the agreements, representations
and warranties of RFC II, RFC III, RFC IV and TRS solely in each such capacity
for so long as RFC II, RFC III, RFC IV and TRS shall act in each such capacity
under this Agreement.
(e) For purposes of determining whether Holders of Investor
Certificates evidencing a specified percentage of the Certificateholders'
Interest have approved, voted on, consented or otherwise agreed to any action
hereunder or under a related Supplement, any Investor Certificates owned by a
Transferor, any Affiliate thereof, any agent thereof or any other party
consolidated with such Transferor for purposes of United States generally
accepted accounting principles shall be disregarded when making such
determination.
(f) Any reference to each Rating Agency shall only apply to
any specific rating agency if such rating agency is then rating any outstanding
Series.
(g) Unless otherwise specified, references to any amount as on
deposit or outstanding on any particular date shall mean such amount at the
close of business on such day.
(h) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement; references to any
Section, subsection, Schedule or Exhibit are references to Sections,
subsections, Schedules and Exhibits in or to this Agreement unless otherwise
specified; and the term "including" means "including without limitation."
[END OF ARTICLE I]
25
ARTICLE II
CONVEYANCE OF RECEIVABLES
Section 2.01 Conveyance of Receivables. By execution of this
Agreement, each Transferor 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 except as provided herein, all of its
right, title and interest, whether now owned or hereafter acquired, in, to and
under the Receivables existing at the close of business on the Initial Cut-Off
Date, in the case of Receivables arising in the Initial Accounts (including
Related Accounts and Transferred Accounts with respect to such Initial
Accounts), and at the close of business on each Addition Cut-Off Date, in the
case of Receivables arising in the Additional Accounts (including Related
Accounts and Transferred Accounts with respect to such Additional Accounts), and
in each case thereafter created from time to time in such Accounts until the
termination of the Trust, all Issuer Rate Fees and Recoveries allocable to the
Trust as provided herein, all monies due and to become due and all amounts
received with respect to all of the foregoing and all proceeds (including
Insurance Proceeds and "proceeds" as defined in the UCC) thereof. Each
Transferor does hereby further transfer, assign, set over and otherwise convey
to the Trustee, on behalf of the Trust, all of its rights, remedies, powers,
privileges and claims under or with respect to any related Receivables Purchase
Agreement (whether arising pursuant to the terms of such Receivables Purchase
Agreement or otherwise). Such property, together with all monies and other
property on deposit in the Collection Account, the Series Accounts and the
Special Funding Account, the rights of the Trustee on behalf of the Trust under
this Agreement and any Supplement, the property conveyed to the Trustee on
behalf of the Trust under any Participation Interest Supplement, any Series
Enhancement and the right to receive Recoveries shall constitute the assets of
the Trust (the "Trust Assets"). The foregoing does not constitute and is not
intended to result in the creation or assumption by the Trust, the Trustee, any
Investor Certificateholder or any Series Enhancer of any obligation of Centurion
Bank, FSB, any other Account Owner, American Express Credco, any Transferor, any
Additional Transferor, the Servicer or any other Person in connection with the
Accounts or the Receivables or under any agreement or instrument relating
thereto, including any obligation to Obligors, merchants clearance systems or
insurers. The foregoing transfer, assignment, set-over and other 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.
Each Transferor agrees to record and file, at its own expense,
financing statements (and amendments thereto when applicable) with respect to
the Trust Assets conveyed by such Transferor meeting the requirements of
applicable state law in such manner and in such jurisdictions as are necessary
to perfect, and maintain the perfection of, the transfer, assignment, set-over
or other conveyance of its interest in such Trust Assets to the Trustee, and to
deliver a file-stamped copy of each such financing statement or amendment or
other evidence of such filing to the Trustee as soon as practicable after the
Substitution Date, in the case of Trust Assets relating to the Initial Accounts,
and (if any additional filing is so necessary) as soon as practicable after the
applicable Addition Date, in the case of Trust Assets relating to Additional
Accounts. The Trustee shall be under no obligation whatsoever to file such
financing statements or amendments thereto or to make any other filing under the
UCC in connection with such transfer, assignment, set-over or other conveyance.
26
Each Transferor further agrees, at its own expense, (a) on or
prior to (i) the Substitution Date, in the case of the Initial Accounts, (ii)
the applicable Addition Date, in the case of Additional Accounts, and (iii) the
applicable Removal Date, in the case of Removed Accounts, to indicate in the
appropriate computer files that Receivables created (or reassigned, in the case
of Removed Accounts) in connection with the Accounts have been conveyed to the
Trustee pursuant to this Agreement for the benefit of the Certificateholders (or
conveyed to such Transferor or its designee in accordance with Section 2.10, in
the case of Removed Accounts) by including (or deleting in the case of Removed
Accounts) in the securitization field of such computer files, in the case of the
Initial Accounts, the code "F", "G", "H", "I", "J", "L", "M","N", "O", "P",
"S", "T", or "V", or any other related code designations specified at the
dates of their designation as "Accounts" under the Original Pooling Agreement
and, in the case of Additional Accounts, a similar code designation that shall
be specified in the Assignment related thereto, in each case, identifying each
such account as an Account and (b) on or prior to (w) the date that is five
Business Days after the Substitution Date, in the case of the Initial Accounts,
(x) the date that is five Business Days after the applicable Addition Date, in
the case of Aggregate Additions, (y) the date that is 90 days after the
applicable Addition Date, in the case of New Accounts, and (z) the date that is
five Business Days after the applicable Removal Date, in the case of Removed
Accounts, to deliver to the Trustee a computer file or microfiche list
containing a true and complete list of all such Accounts specifying for each
such Account, as of the Initial Cut-Off Date, in the case of the Initial
Accounts, the applicable Addition Cut-Off Date, in the case of Additional
Accounts, and the applicable Removal Date, in the case of Removed Accounts, its
account number and, other than in the case of New Accounts and the Initial
Accounts, the aggregate amount outstanding in such Account. Each such file or
list, as supplemented, from time to time, to reflect Related Accounts,
Transferred Accounts, Additional Accounts and Removed Accounts, shall be marked
as Schedule 1 to this Agreement and is hereby incorporated into and made a part
of this Agreement. Each Transferor further agrees not to alter the code
referenced in this paragraph with respect to any Account during the term of this
Agreement unless and until such Account becomes a Removed Account.
The parties to this Agreement intend that the conveyance of
Trust Assets pursuant to this Agreement constitute a sale, and not a secured
borrowing, for accounting purposes. Nevertheless, this Agreement also shall
constitute a security agreement under applicable law, and the Transferors hereby
grant to the Trustee a first priority perfected security interest in all of
their right, title and interest, whether now owned or hereafter acquired, in and
to the Receivables and the other Trust Assets, and all money, accounts, general
intangibles, chattel paper, instruments, documents, goods, investment property,
deposit accounts, letters of credit and letter-of-credit rights consisting of,
arising from or related to the Trust Assets, and all proceeds thereof, to secure
their obligations hereunder.
By executing this Agreement and any Receivables Purchase
Agreement, the parties hereto and thereto do not intend to cancel, release or in
any way impair the conveyance made by RFC II or Centurion Bank in their
respective capacities as a "Transferor" under the Original Pooling Agreement.
Without limiting the foregoing, the parties hereto acknowledge and agree as
follows:
(a) The Trust created by and maintained under the Original
Pooling Agreement shall continue to exist and be maintained under this
Agreement.
27
(b) All series of investor certificates issued under the
Original Pooling Agreement shall constitute Series issued and outstanding under
this Agreement, and any supplement existing in connection with such series shall
constitute a Supplement executed hereunder.
(c) All references to the Original Pooling Agreement in any
other instruments or documents shall be deemed to constitute references to this
Agreement. All references in such instruments or documents to Centurion Bank in
its capacity as a "Transferor" of receivables and related assets under the
Original Pooling Agreement shall be deemed to include reference to RFC III and
RFC IV in such capacities hereunder.
(d) Subject to clause (f) below, RFC III and RFC IV hereby
agree to perform all obligations of Centurion Bank, in its capacity as a
"Transferor," under or in connection with the Original Pooling Agreement (as
amended and restated by this Agreement), any Supplements to the Original Pooling
Agreement and any related Enhancement Agreements. RFC II shall remain as a
Transferor under this Agreement on and after the Substitution Date and all
references to "Transferor" shall include references to RFC II.
(e) To the extent this Agreement requires that certain actions
are to be taken as of a date prior to the date of this Agreement, RFC II's or
Centurion Bank's, as applicable, taking of such action under the Original
Pooling Agreement shall constitute satisfaction of such requirement.
(f) All representations, warranties and covenants of RFC II or
Centurion Bank, as applicable, made in Article II of the Original Pooling
Agreement and in any Assignment of Additional Accounts with respect to
receivables and related assets transferred to the Trustee prior to the
Substitution Date, shall remain in full force and effect with respect to RFC II
or Centurion Bank, as applicable.
Section 2.02 Acceptance by Trustee.
(a) The Trustee hereby acknowledges its acceptance on behalf
of the Trust of all right, title and interest to the Trust Assets conveyed to
the Trustee pursuant to Section 2.01 and declares that it shall maintain such
right, title and interest, upon the trust herein set forth, for the benefit of
all Certificateholders. The Trustee further acknowledges that, prior to or
simultaneously with the execution and delivery of this Agreement, the
Transferors delivered to the Trustee the computer file or microfiche list
relating to the Initial Accounts described in the third to last paragraph of
Section 2.01. The Trustee shall maintain a copy of Schedule 1, as delivered from
time to time, at the Corporate Trust Office.
(b) The Trustee hereby agrees not to disclose to any Person
any of the account numbers or other information contained in the computer files
or microfiche lists marked as Schedule 1 delivered to the Trustee, from time to
time, except (i) to a Successor Servicer or as required by a Requirement of Law
applicable to the Trustee, (ii) in connection with the performance of the
Trustee's duties hereunder, (iii) in enforcing the rights of Certificateholders
or (iv) to bona fide creditors or potential creditors of Centurion Bank, FSB,
any other Account Owner, American Express Credco or any Transferor for the
limited purpose of enabling any such creditor to identify Receivables or
Accounts subject to this Agreement or the Receivables Purchase Agreements. The
Trustee agrees to take such measures as shall be reasonably requested by any
Account Owner or any Transferor to protect and maintain the security and
confidentiality of such information and, in connection therewith, shall allow
each Account Owner and each Transferor or their duly authorized representatives
to inspect the Trustee's security and confidentiality arrangements from time to
time during business hours. The Trustee shall provide the applicable Account
Owner and the applicable Transferor with notice five Business Days prior to
disclosure of any information of the type described in this subsection 2.02(b).
28
(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.
Section 2.03 Representations and Warranties of Each Transferor
Relating to Such Transferor. Each Transferor hereby severally represents and
warrants to the Trust (and agrees that the Trustee may rely on each such
representation and warranty in accepting the Receivables in trust and in
authenticating the Certificates) as of the Substitution Date and as of each
Closing Date (but only if it was a Transferor on such date) that:
(a) Organization and Good Standing. Such Transferor is a
limited liability company or corporation validly existing under the laws of the
jurisdiction of its organization or incorporation and has, in all material
respects, full power and authority to own its properties and conduct its
business as presently owned or conducted, and to execute, deliver and perform
its obligations under this Agreement, each Receivables Purchase Agreement (if
any) to which it is a party and each applicable Supplement and to execute and
deliver to the Trustee the Certificates.
(b) Due Qualification. Such Transferor is duly qualified to do
business and is in good standing as a foreign limited liability company or a
foreign corporation and has obtained all necessary licenses and approvals, in
each jurisdiction in which failure to so qualify or to obtain such licenses and
approvals would (i) render any Account Agreement relating to an Account
specified herein or any Receivable conveyed to the Trustee by such Transferor
unenforceable by such Transferor, the Servicer or the Trustee and (ii) have a
material adverse effect on the Investor Certificateholders; provided, however,
that no Transferor makes any representation or warranty with respect to any
qualification, license or approval that 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 by such
Transferor of this Agreement, each Supplement and each Receivables Purchase
Agreement (if any) to which such Transferor is a party and the execution and
delivery to the Trustee of the Certificates and the consummation by such
Transferor of the transactions provided for in this Agreement, each Supplement
and each such Receivables Purchase Agreement (if any) have been duly authorized
by such Transferor by all necessary limited liability company or corporate
action on the part of such Transferor.
(d) No Conflict. The execution and delivery by such Transferor
of this Agreement, each Supplement, and the Certificates, the performance by
such Transferor of the transactions contemplated by this Agreement and each
Supplement and the fulfillment by such Transferor of the terms hereof and
thereof applicable to such Transferor, will not conflict with or violate any
Requirements of Law applicable to such Transferor or conflict with, result in
any breach of any of the material terms and provisions of, or constitute (with
or without notice or lapse of time or both) a material default under, any
indenture, contract, agreement, mortgage, deed of trust or other instrument to
which such Transferor is a party or by which it or its properties are bound.
29
(e) No Proceedings. There are no proceedings or
investigations, pending or, to the best knowledge of such Transferor, threatened
against such Transferor before any Governmental Authority (i) asserting the
invalidity of this Agreement, any Supplement or the Certificates, (ii) seeking
to prevent the issuance of any of the Certificates or the consummation of any of
the transactions contemplated by this Agreement, any Supplement or the
Certificates, (iii) seeking any determination or ruling that, in the reasonable
judgment of such Transferor, would materially and adversely affect the
performance by such Transferor of its obligations under this Agreement or any
Supplement, (iv) seeking any determination or ruling that, in such Transferor's
reasonable judgment, would materially and adversely affect the validity or
enforceability of this Agreement, any Supplement or the Certificates or (v)
seeking to affect adversely the income or franchise tax attributes of the Trust
under the United States Federal or any State income or franchise tax systems.
(f) All Consents. All authorizations, consents, orders or
approvals of or registrations or declarations with any Governmental Authority
required to be obtained, effected or given by such Transferor in connection with
the execution and delivery by such Transferor of this Agreement, each Supplement
and the Certificates and the performance of the transactions contemplated by
this Agreement and each Supplement by such Transferor have been duly obtained,
effected or given and are in full force and effect.
Section 2.04 Representations and Warranties of Each Transferor
Relating to the Agreement and Any Supplement and the Receivables.
(a) Representations and Warranties. Each Transferor hereby
severally represents and warrants to the Trust and the Trustee as of the
Substitution Date, each subsequent Closing Date and, with respect to Additional
Accounts, as of the related Addition Date (but only if it was a Transferor on
such date) that:
(i) each of the Receivables Purchase Agreements (if any) to
which such Transferor is a party, this Agreement, each Supplement
and, in the case of Additional Accounts, each related Assignment,
constitutes a legal, valid and binding obligation of such
Transferor, enforceable against such Transferor in accordance with
its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting creditors' rights generally from time
to time in effect or general principles of equity;
(ii) as of the Initial Cut-Off Date with respect to Initial
Accounts and as of the related Addition Cut-Off Date with respect to
Additional Accounts, Schedule 1 to this Agreement, as supplemented
to such date, is an accurate and complete listing in all material
respects of all the Accounts specified herein as of the Initial
Cut-Off Date or such Addition Cut-Off Date, as the case may be, and
the information contained therein with respect to the identity of
such Accounts and the Receivables existing thereunder is true and
correct in all material respects as of the Initial Cut-Off Date or
such Addition Cut-Off Date, as the case may be;
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(iii) each Receivable conveyed to the Trustee by such
Transferor has been conveyed to the Trustee free and clear of any
Lien (other than as permitted by clause (d) of the term "Eligible
Receivable");
(iv) all authorizations, consents, orders or approvals of or
registrations or declarations with any Governmental Authority
required to be obtained, effected or given by such Transferor in
connection with the conveyance by such Transferor of Receivables to
the Trust have been duly obtained, effected or given and are in full
force and effect;
(v) subject, in each case pertaining to proceeds, to Section
9-315 of the UCC, and further subject to any Liens permitted by
clause (d) of the term "Eligible Receivable"), each of this
Agreement or, in the case of Additional Accounts, the related
Assignment either constitutes a valid transfer and assignment to the
Trustee of all right, title and interest of such Transferor in the
Receivables conveyed to the Trustee by such Transferor and the
proceeds thereof and Recoveries identified as relating to the
Receivables conveyed to the Trustee by such Transferor which have
become Defaulted Receivables, or it constitutes a grant of a
first-priority "security interest" (as defined in the UCC) in such
property to the Trustee, which, in the case of existing Receivables
and the proceeds thereof and such Recoveries, is enforceable upon
execution and delivery of this Agreement, or, with respect to then
existing Receivables in Additional Accounts, as of the applicable
Addition Date, and which will be enforceable with respect to such
Receivables hereafter and thereafter created and the proceeds and
Recoveries thereof upon such creation. Upon the filing of the
financing statements and, in the case of Receivables hereafter
created and the proceeds and Recoveries thereof, upon the creation
thereof, the Trustee shall have a first-priority perfected security
or ownership interest in such property and proceeds;
(vi) on the applicable Addition Selection Date, each related
Additional Account is an Eligible Account;
(vii) on the applicable Addition Selection Date, each
Receivable then existing in the related Additional Accounts and
conveyed to the Trustee by such Transferor is an Eligible
Receivable;
(viii) as of the date of the creation of any new Receivable in
a related Account specified herein, such Receivable is an Eligible
Receivable; and
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(ix) no selection procedures believed by such Transferor to be
materially adverse to the interests of the Investor
Certificateholders have been used in selecting such related
Accounts.
(b) Notice of Breach. The representations and warranties set
forth in Section 2.03, this Section 2.04 and subsection 2.09(f) shall survive
the transfers and assignments of the Trust Assets to the Trustee and the
issuance of the Certificates. Upon discovery by any Transferor, the Servicer or
the Trustee of a breach of any of the representations and warranties set forth
in Section 2.03, this Section 2.04 or subsection 2.09(f), the party discovering
such breach shall give notice to the other parties and to each Series Enhancer
within three Business Days following such discovery; provided that the failure
to give notice within three Business Days does not preclude subsequent notice.
(c) Representations and Warranties of Each Transferor Relating
to Security Interests. Each Transferor hereby makes the following
representations and warranties with respect to the Receivables it conveys to the
Trustee. Such representations and warranties shall survive until the termination
of this Agreement and each shall speak as of the Substitution Date and, with
respect to Receivables in Additional Accounts, as of the related Addition Date.
None of the following shall be waived by any of the parties to this Agreement
unless each Rating Agency shall have notified the Transferors, the Servicer and
the Trustee in writing that such waiver will not result in a reduction or
withdrawal of the rating of any outstanding Series or Class to which it is a
Rating Agency.
(a) This Agreement creates a valid and continuing security
interest (as defined in the applicable UCC) in favor of the Trustee
in the Receivables described in Section 2.01 of this Agreement or in
Section 3(a) of any Assignment (the "Collateral"), which security
interest is prior to all other Liens except as otherwise permitted
hereunder, and is enforceable as such against creditors of and
purchasers from such Transferor.
(b) The Collateral constitutes "accounts" or "general
intangibles" within the meaning of the applicable UCC.
(c) At the time of its transfer of any Receivable to the
Trustee pursuant to this Agreement or an Assignment, such Transferor
owned and had good and marketable title to such Receivable free and
clear of any lien, claim or encumbrance of any Person except as
otherwise permitted hereunder.
(d) Such Transferor has caused or will have caused, within ten
(10) days of the initial execution of this Agreement and each
Assignment, the filing of all appropriate financing statements in
the proper filing office in the appropriate jurisdictions under
applicable law in order to perfect the security interest in the
related Collateral granted to the Trustee pursuant to this Agreement
or such Assignment.
(e) Other than the security interest granted to the Trustee
pursuant to this Agreement or an Assignment, such Transferor has not
pledged, assigned, sold, granted a security interest in, or
otherwise conveyed the Collateral. Such Transferor has not
authorized the filing of and is not aware of any financing
statements against such Transferor that include a description of the
Collateral other than any financing statement relating to the
security interest granted to the Trustee pursuant to this Agreement
or an Assignment or that has been terminated. Such Transferor is not
aware of any judgment or tax lien filings against such Transferor.
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Section 2.05 Reassignment of Ineligible Receivables.
(a) Reassignment of Receivables. In the event (i) any
representation or warranty contained in subsection 2.04(a)(ii), (iii), (iv),
(vi), (vii) or (viii) is not true and correct in any material respect as of the
date specified therein with respect to any Receivable or the related Account and
such breach has a material adverse effect on the Investor Certificateholders
(which determination shall be made without regard to whether funds are then
available pursuant to any Series Enhancement) unless cured within 60 days (or
such longer period, not in excess of 120 days, as may be agreed to by the
Trustee and the Servicer) after the earlier to occur of the discovery thereof by
the Transferor that conveyed such Receivables to the Trust or receipt by such
Transferor of written notice thereof given by the Trustee or the Servicer, or
(ii) it is so provided in subsection 2.07(a) or 2.09(d)(iii) with respect to any
Receivables conveyed to the Trust by such Transferor, then such Transferor shall
accept reassignment of the Certificateholders' Interest in all Receivables in
the related Account ("Ineligible Receivables") on the terms and conditions set
forth in paragraph (b) below.
(b) Price of Reassignment. The Servicer shall deduct the
portion of such Ineligible Receivables reassigned to each Transferor which are
Principal Receivables from the aggregate amount of the Principal Receivables
used to calculate the Transferor Amount. In the event that, following the
exclusion of such Principal Receivables from the calculation of the Transferor
Amount, the Transferor Amount would be less than the Required Transferor Amount,
not later than 1:00 P.M., New York City time, on the first Distribution Date
following the Monthly Period in which such reassignment obligation arises, the
applicable Transferor shall make a deposit into the Special Funding Account in
immediately available funds in an amount equal to the amount by which the
Transferor Amount would be below the Required Transferor Amount (up to the
amount of such Principal Receivables).
Upon reassignment of any Ineligible Receivable, the Trustee,
on behalf of the Trust, shall automatically and without further action sell,
transfer, assign, set over and otherwise convey to the applicable Transferor or
its designee, without recourse, representation or warranty, all the right, title
and interest of the Trustee and the Trust in and to such Ineligible Receivable,
all monies due or to become due and all proceeds thereof and such reassigned
Ineligible Receivable shall be treated by the Trust as collected in full as of
the date on which it was transferred. The obligation of each Transferor to
accept reassignment of any Ineligible Receivables conveyed to the Trustee by
such Transferor, and to make the deposits, if any, required to be made to the
Special Funding Account as provided in this Section, shall constitute the sole
remedy respecting the event giving rise to such obligation available to
Certificateholders (or the Trustee on behalf of the Certificateholders) or any
Series Enhancer. Notwithstanding any other provision of this subsection 2.05(b),
a reassignment of an Ineligible Receivable in excess of the amount that would
cause the Transferor Amount to be less than the Required Transferor Amount shall
not occur if the applicable Transferor fails to make any deposit required by
this subsection 2.05(b) with respect to such Ineligible Receivable. The Trustee
shall execute such documents and instruments of transfer or assignment and take
such other actions as shall reasonably be requested by the applicable Transferor
to effect the conveyance of such Ineligible Receivables pursuant to this
subsection 2.05(b), but only upon receipt of an Officer's Certificate from such
Transferor certifying that all conditions set forth in this Section 2.05 have
been satisfied.
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Section 2.06 Reassignment of Certificateholders' Interest in
Trust Portfolio. In the event any representation or warranty of a Transferor set
forth in subsection 2.03(a) or (c) or subsection 2.04(a)(i) or (v) is not true
and correct in any material respect and such breach has a material adverse
effect on the Investor Certificateholders (which determination shall be made
without regard to whether funds are then available pursuant to any Series
Enhancement), then either the Trustee or the Holders of Investor Certificates
evidencing not less than 50% of the aggregate unpaid principal amount of all
outstanding Investor Certificates, by notice then given to such Transferor and
the Servicer (and to the Trustee if given by the Investor Certificateholders),
may direct such Transferor to accept a reassignment of the Certificateholders'
Interest in the Receivables and any Participation Interests conveyed to the
Trust by such Transferor if such breach and any material adverse effect caused
by such breach is not cured within 60 days of such notice (or within such longer
period, not in excess of 120 days, as may be specified in such notice), and upon
those conditions such Transferor shall be obligated to accept such reassignment
on the terms set forth below; provided, however, that such Receivables will not
be reassigned to such Transferor if, on any day prior to the end of such 60-day
or longer period (i) the relevant representation and warranty shall then be true
and correct in all material respects and (ii) such Transferor shall have
delivered to the Trustee a certificate of an authorized officer describing the
nature of such breach and the manner in which the relevant representation and
warranty has become true and correct.
The applicable Transferor shall deposit in the Collection
Account in immediately available funds not later than 1:00 P.M., New York City
time, on the first Transfer Date following the Monthly Period in which such
reassignment obligation arises, in payment for such reassignment, an amount
equal to the sum of the amounts specified therefor with respect to each
outstanding Series in the related Supplement. Notwithstanding anything to the
contrary in this Agreement, such amounts shall be distributed to the Investor
Certificateholders on such Distribution Date in accordance with the terms of
each Supplement. If the Trustee or the Investor Certificateholders give notice
directing the applicable Transferor to accept a reassignment of the
Certificateholders' Interest in the Receivables as provided above, the
obligation of such Transferor to accept such reassignment pursuant to this
Section and to make the deposit required to be made to the Collection Account as
provided in this paragraph shall constitute the sole remedy respecting an event
of the type specified in the first sentence of this Section available to the
Certificateholders (or the Trustee on behalf of the Certificateholders) or any
Series Enhancer.
Section 2.07 Covenants of Each Transferor. Each Transferor
hereby severally covenants that:
(a) Receivables Not To Be Evidenced by Promissory Notes.
Except in connection with its enforcement or collection of an Account, such
Transferor will take no action to cause any Receivable conveyed by it to the
Trustee to be evidenced by any instrument (as defined in the UCC) and if any
such Receivable is so evidenced as a result of any action taken by such
Transferor it shall be deemed to be an Ineligible Receivable in accordance with
subsection 2.05(a) and shall be reassigned to such Transferor in accordance with
subsection 2.05(b).
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(b) Security Interests. Except for the conveyances hereunder,
such Transferor will not sell, pledge, assign or transfer to any other Person,
or grant, create, incur, assume or suffer to exist (except as permitted by
clause (d) of the definition of the term "Eligible Receivable") any Lien on, any
Receivable or Participation Interest conveyed by it to the Trust, whether now
existing or hereafter created, or any interest therein, and such Transferor
shall defend the right, title and interest of the Trustee in, to and under the
Receivables and any Participation Interest, whether now existing or hereafter
created, against all claims of third parties claiming through or under such
Transferor.
(c) Transferors' Interest. Except for (i) the conveyances
hereunder, in connection with any transaction permitted by Section 7.02 or
Section 7.05 and as provided in subsection 2.09(g) and Section 6.03 or (ii)
conveyances with respect to which the Rating Agency Condition shall have been
satisfied and a Tax Opinion shall have been delivered to the Trustee, such
Transferor agrees not to transfer, sell, assign, exchange or otherwise convey or
pledge, hypothecate or otherwise grant a security interest in, the Transferors'
Interest represented by the Original Transferor Certificate or any Supplemental
Certificate and any such attempted transfer, assignment, exchange, conveyance,
pledge, hypothecation, grant or sale shall be void. Nothing contained in this
subsection 2.07(c) shall be interpreted to prohibit or in any way limit any
Transferor's ability to grant to another Person a participation interest in the
Transferors' Interest upon the delivery to the Trustee of a Tax Opinion.
(d) Delivery of Collections or Recoveries. In the event that
such Transferor receives Collections or Recoveries, such Transferor agrees to
pay the Servicer all such Collections and Recoveries as soon as practicable
after receipt thereof.
(e) Notice of Liens. Such Transferor shall notify the Trustee
and each Series Enhancer promptly after becoming aware of (except as permitted
by clause (d) of the definition of the term "Eligible Receivable") any Lien on
any Receivable or Participation Interest conveyed by it to the Trust other than
the conveyances hereunder and under any Receivables Purchase Agreement to which
such Transferor is a party.
(f) Issuer Rate Fees. On or prior to each Determination Date,
such Transferor shall notify the Servicer of the amount of Issuer Rate Fees to
be included as Collections of Finance Charge Receivables with respect to the
preceding Monthly Period, which shall be equal to the amount of Issuer Rate Fees
paid to such Transferor pursuant to the relevant Receivables Purchase Agreement
with respect to such Monthly Period.
(g) Separate Corporate Existence. Such Transferor shall:
(i) Maintain in full effect its existence, rights and
franchises as a limited liability company under the laws of the
state of its formation or as a corporation under the laws of the
state of its incorporation and will obtain and preserve its
qualification to do business in each jurisdiction in which such
qualification is or shall be necessary to protect the validity and
enforceability of this Agreement and the applicable Receivables
Purchase Agreement and each other instrument or agreement necessary
or appropriate to proper administration hereof and to permit and
effectuate the transactions contemplated hereby.
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(ii) Except as provided herein, maintain its own deposit,
securities and other account or accounts, separate from those of any
Affiliate of such Transferor, with financial institutions. The funds
of such Transferor will not be diverted to any other Person or for
other than the company use of such Transferor, and, except as may be
expressly permitted by this Agreement or the applicable Receivables
Purchase Agreement, the funds of such Transferor shall not be
commingled with those of any other Person.
(iii) Ensure that, to the extent that it shares the same
officers or other employees as any of its members or other
Affiliates, the salaries of and the expenses related to providing
benefits to such officers and other employees shall be fairly
allocated among such entities, and each such entity shall bear its
fair share of the salary and benefit costs associated with all such
common officers and employees.
(iv) Ensure that, to the extent that it jointly contracts with
any of its members or other Affiliates to do business with vendors
or service providers or to share overhead expenses, the costs
incurred in so doing shall be allocated fairly among such entities,
and each such entity shall bear its fair share of such costs. To the
extent that such Transferor contracts or does business with vendors
or service providers where the goods and services provided are
partially for the benefit of any other Person, the costs incurred in
so doing shall be fairly allocated to or among such entities for
whose benefit the goods and services are provided, and each such
entity shall bear its fair share of such costs.
(v) Ensure that all material transactions between such
Transferor and any of its Affiliates shall be only on an
arm's-length basis and shall not be on terms more favorable to
either party than the terms that would be found in a similar
transaction involving unrelated third parties.
(vi) Maintain a principal executive and administrative office
through which its business is conducted and a telephone number
separate from those of its members and other Affiliates. To the
extent that such Transferor and any of its members or other
Affiliates have offices in contiguous space, there shall be fair and
appropriate allocation of overhead costs (including rent) among
them, and each such entity shall bear its fair share of such
expenses.
(vii) Conduct its affairs strictly in accordance with its
certificate of formation and limited liability company agreement or
its certificate of incorporation and bylaws and observe all
necessary, appropriate and customary company formalities, including,
but not limited to, holding all regular and special members' and
directors' meetings appropriate to authorize all action, keeping
separate and accurate minutes of such meetings, passing all
resolutions or consents necessary to authorize actions taken or to
be taken, and maintaining accurate and separate books, records and
accounts, including, but not limited to, intercompany transaction
accounts. Regular members' and directors' meetings shall be held at
least annually.
36
(viii) Ensure that its board of directors shall at all times
include at least one Independent Director (for purposes hereof,
"Independent Director" shall mean any member of the board of
directors of such Transferor that is not and has not at any time
been (x) an officer, agent, advisor, consultant, attorney,
accountant, employee, member or shareholder of any Affiliate of such
Transferor which is not a special purpose entity, (y) a director of
any Affiliate of such Transferor other than an independent director
of any Affiliate which is a special purpose entity or (z) a member
of the immediate family of any of the foregoing).
(ix) Ensure that decisions with respect to its business and
daily operations shall be independently made by such Transferor
(although the officer making any particular decision may also be an
officer or director of an Affiliate of such Transferor) and shall
not be dictated by an Affiliate of such Transferor.
(x) Act solely in its own company name and through its own
authorized officers and agents, and no Affiliate of such Transferor
shall be appointed to act as agent of such Transferor. Such
Transferor shall at all times use its own stationery and business
forms and describe itself as a separate legal entity.
(xi) Other than as provided in the relevant Revolving Credit
Agreement, ensure that no Affiliate of such Transferor shall advance
funds or loan money to such Transferor, and no Affiliate of such
Transferor will otherwise guaranty debts of such Transferor.
(xii) Other than organizational expenses and as expressly
provided herein, pay all expenses, indebtedness and other
obligations incurred by it using its own funds.
(xiii) Not enter into any guaranty, or otherwise become
liable, with respect to or hold its assets or creditworthiness out
as being available for the payment of any obligation of any
Affiliate of such Transferor nor shall such Transferor make any
loans to any Person.
(xiv) Ensure that any financial reports required of such
Transferor shall comply with generally accepted accounting
principles and shall be issued separately from, but may be
consolidated with, any reports prepared for any of its Affiliates so
long as such consolidated reports contain footnotes describing the
effect of the transactions between such Transferor and such
Affiliate and also state that the assets of such Transferor are not
available to pay creditors of the Affiliate.
37
(xv) Ensure that at all times it is adequately capitalized to
engage in the transactions contemplated in its certificate of
formation and its limited liability company agreement or in its
certificate of incorporation and bylaws.
(h) RFC II hereby further covenants that:
(i) Amendment of the Certificate of Incorporation. RFC II will
not amend in any material respect its Certificate of Incorporation
without providing each Rating Agency with notice no later than the
fifth Business Day prior to such amendment (unless the right to such
notice is waived by such Rating Agency) and satisfying the Rating
Agency Condition.
(ii) Other Indebtedness. RFC II shall not incur any additional
debt, unless each Rating Agency is provided with notice no later
than the fifth Business Day prior to the incurrence of such
additional debt (unless the right to such notice is waived by each
Rating Agency) and the Rating Agency Condition is satisfied with
respect to the incurrence of such debt.
Section 2.08 Additional Covenants of Each Transferor Regarding
the Terms of the Accounts. Each Transferor, in its capacity as purchaser of
Receivables from any Account Owner (each, a "Receivables Originator") or
American Express Credco pursuant to a Receivables Purchase Agreement (if any) to
which such Transferor is a party, hereby covenants that such Transferor will at
all times enforce the covenants and agreements of such Receivables Originators
or American Express Credco in such Receivables Purchase Agreements, including
covenants to the effect set forth below only to the extent to which they are
enforceable against such Receivables Originators or American Express Credco
pursuant to such Receivables Purchase Agreements:
(a) Periodic Rate Finance Charges. (i) Except (x) as otherwise
required by any Requirements of Law or (y) as is deemed by Centurion Bank, FSB
or other Account Owner, as the case may be, to be necessary in order for it to
maintain its credit or charge business, as applicable, or a program operated by
such credit or charge business, as applicable, on a competitive basis based on a
good faith assessment by it of the nature of the competition with respect to
such credit or charge business or such program, such Receivables Originator
shall not at any time take any action which would have the effect of reducing
the Portfolio Yield to a level that could be reasonably expected to cause any
Series to experience any Pay-Out Event or Reinvestment Event based on the
insufficiency of the Portfolio Yield or any similar test and (ii) except as
otherwise required by any Requirements of Law, such Receivables Originator shall
not take any action which would have the effect of reducing the Portfolio Yield
to be less than the then-current highest Average Rate for any Group.
(b) Account Agreements and Guidelines. Subject to compliance
with all Requirements of Law and paragraph (a) above, Centurion Bank, FSB or
other Account Owner, as the case may be, may change the terms and provisions of
the applicable Account Agreements or the applicable Credit Guidelines in any
respect (including the calculation of the amount or the timing of charge-offs
and the Periodic Rate Finance Charges to be assessed thereon). Notwithstanding
the above, unless required by Requirements of Law or as permitted by paragraph
(a) above, Centurion Bank, FSB or other Account Owner, as the case may be, will
not take any action with respect to the applicable Account Agreements or the
applicable Credit Guidelines, which, at the time of such action, Centurion Bank,
FSB or other Account Owner, as the case may be, reasonably believes will have a
material adverse effect on the rights of the Trust or the Investor
Certificateholders.
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Each Transferor further covenants that it will not enter into
any amendment to any Receivables Purchase Agreement to which it is a party, or
enter into a new Receivables Purchase Agreement unless the Rating Agency
Condition shall have been satisfied.
Section 2.09 Addition of Accounts.
(a) Required Additional Accounts. (i) If, as of the end of any
Monthly Period, the total amount of Principal Receivables and the then
outstanding principal amount of any Participation Interests theretofore conveyed
to the Trust is less than the Required Minimum Principal Balance on such date,
the Transferors shall on or prior to the close of business on the tenth Business
Day of the next Monthly Period (the "Required Designation Date"), cause to be
designated additional Eligible Accounts to be included as Accounts as of the
Required Designation Date or any earlier date in a sufficient amount (or such
lesser amount as shall represent all Eligible Accounts then available to the
Transferors under the Receivables Purchase Agreements) such that, after giving
effect to such addition, the aggregate principal balance of Principal
Receivables, plus the then outstanding principal amount of any Participation
Interests conveyed to the Trustee as of the close of business on the Addition
Date, is at least equal to the Required Minimum Principal Balance on such date.
(ii) Optional Participation Interests. In lieu of, or in
addition to, causing the designation of Additional Accounts pursuant
to clause (i) above, subject to the conditions specified in
paragraph (c) below, the Transferors may (but shall not be required
to) convey to the Trust participations (including 100%
participations) representing undivided interests in a pool of assets
primarily consisting of one or more of the following ("Participation
Interests"): credit card or other credit account receivables, charge
card or other charge account receivables, consumer loan receivables
(secured and unsecured), and/or any interests in any of the
foregoing, including securities representing or backed by such
receivables, and other self-liquidating financial assets including
any "Eligible Assets" as such term is defined in Rule 3a-7 under the
Investment Company Act (or any successor to such rule) and
collections, together with all earnings, revenues, dividends,
distributions, income, issues and profits thereon. The addition of
Participation Interests in the Trust pursuant to this paragraph (a)
or paragraph (b) below shall be effected by a Participation Interest
Supplement, dated the applicable Addition Date and entered into
pursuant to subsection 13.01(a).
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(iii) Any Additional Accounts or Participation Interests
designated to be included as Trust Assets pursuant to clauses (i) or
(ii) above may only be so included if (x) Standard & Poor's shall
have notified the Transferors, the Servicer and the Trustee in
writing that such addition will not result in a reduction or
withdrawal of the then existing rating of any outstanding Series or
Class with respect to which Standard & Poor's is a Rating Agency and
(y) the applicable conditions specified in paragraph (c) below have
been satisfied.
(b) Permitted Aggregate Additions. Each Transferor may from
time to time, at its sole discretion, subject to the conditions specified in
paragraph (c) below, voluntarily cause the designation of additional Eligible
Accounts to be included as Accounts and the related Receivables and any
Participation Interests to be included as Trust Assets, in either case, as of
the applicable Addition Date.
(c) Conditions to Aggregate Additions. On the Addition Date
with respect to any Aggregate Additions, the Trustee shall acquire the
Receivables existing in Aggregate Addition Accounts (and such Aggregate Addition
Accounts shall be deemed to be Accounts for purposes of this Agreement) as of
the close of business on the applicable Addition Cut-Off Date or shall acquire
such Participation Interests, subject to the satisfaction of the following
conditions:
(i) on or before the eighth Business Day immediately preceding
the Addition Date, the applicable Transferor shall have given the
Trustee, the Servicer and each Rating Agency notice (unless such
notice requirement is otherwise waived) that the Aggregate Addition
Accounts or Participation Interests will be included and specifying
the applicable Addition Date, Addition Cut-Off Date and Addition
Selection Date;
(ii) all Aggregate Addition Accounts shall be Eligible
Accounts;
(iii) the applicable Transferor shall have delivered to the
Trustee copies of UCC financing statements covering such Aggregate
Addition Accounts, if necessary to perfect the Trustee's interest in
the Receivables arising therein;
(iv) to the extent required by Section 4.03, the applicable
Transferor shall have deposited in the Collection Account all
Collections with respect to such Aggregate Addition Accounts since
the Addition Cut-Off Date;
(v) as of each of the Addition Cut-Off Date and the Addition
Date, no Insolvency Event shall have occurred nor shall the transfer
of the Receivables arising in the Aggregate Addition Accounts or of
the Participation Interests to the Trust have been made in
contemplation of the occurrence thereof;
(vi) solely with respect to Aggregate Additions designated
pursuant to subsection 2.09(b), the Rating Agency Condition shall
have been satisfied;
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(vii) the applicable Transferor shall have delivered to the
Trustee an Officer's Certificate of such Transferor, dated the
Addition Date, confirming, to the extent applicable, the items set
forth in clauses (ii) through (vi) above;
(viii) the addition to the Trust of the Receivables arising in
the Aggregate Addition Accounts or of the Participation Interests
will not result in an Adverse Effect and, in the case of Aggregate
Additions, the applicable Transferor shall have delivered to the
Trustee an Officer's Certificate of such Transferor, dated the
Addition Date, stating that such Transferor reasonably believes that
the addition to the Trust of the Receivables arising in the
Aggregate Addition Accounts or of the Participation Interests will
not have an Adverse Effect; and
(ix) the applicable Transferor shall have delivered to the
Trustee and each Rating Agency an Opinion of Counsel, dated the
Addition Date, in accordance with subsection 13.02(d)(ii) or (iv),
as applicable.
(d) New Accounts.
(i) Each Transferor may from time to time, at its sole
discretion, subject to and in compliance with the limitations
specified in clause (ii) below and the conditions specified in
paragraph (e) below, voluntarily designate newly originated Eligible
Accounts to be included as New Accounts. For purposes of this
paragraph, Eligible Accounts shall be deemed to include only credit
or charge accounts of the same nature as those included as Initial
Accounts or which have previously been included in any Aggregate
Addition if the Assignment related to such Aggregate Addition
expressly provides that such type of credit or charge account is
permitted to be designated as a New Account.
(ii) Unless and until each Rating Agency otherwise consents in
writing, the Transferors shall not be permitted to designate New
Accounts and, upon obtaining such consent, the number and balance of
New Accounts designated with respect to any period designated by the
Rating Agency shall not exceed the amounts designated by the Rating
Agency.
(iii) With respect to each semi-annual period in which New
Accounts are added as Accounts, the failure of the applicable
Transferor to deliver an Opinion of Counsel substantially in the
form of Exhibit E-2 (or, if the owner of the applicable Accounts has
a long-term rating below "A" by Moody's or "AA-" by Standard &
Poor's, such Opinion of Counsel shall be delivered quarterly, and if
the long-term rating of the owner of the applicable Accounts is not
rated by Moody's or Standard & Poor's or, if rated, is not rated at
least "A-" by Standard & Poor's and in one of the generic categories
of each other Rating Agency which signifies investment grade, such
Opinion of Counsel shall be delivered monthly) with respect to the
New Accounts included as Accounts shall result in all Receivables
arising in the New Accounts to which such failure relates to be
deemed to be Ineligible Receivables in accordance with subsection
2.05(a) and all such Receivables shall be reassigned to such
Transferor in accordance with subsection 2.05(b). The opinion
delivery requirement set forth in the immediately preceding sentence
may be modified provided that the Rating Agency Condition is
satisfied.
41
(e) Conditions to Addition of New Accounts. On the Addition
Date with respect to any New Accounts, at the direction of the Servicer, the
Trustee, on behalf of the Trust, shall acquire the Receivables existing in such
New Accounts (and such New Accounts shall be deemed to be Accounts for purposes
of this Agreement) as of the close of business on the applicable Addition
Cut-Off Date, subject to the satisfaction of the following conditions:
(i) the New Accounts shall all be Eligible Accounts;
(ii) the applicable Transferor shall have delivered to the
Trustee copies of UCC financing statements covering such New
Accounts, if necessary to perfect the Trustee's interest in the
Receivables arising therein;
(iii) to the extent required by Section 4.03, the applicable
Transferor shall have deposited in the Collection Account all
Collections with respect to such New Accounts since the Addition
Cut-Off Date;
(iv) as of each of the Addition Cut-Off Date and the Addition
Date, no Insolvency Event shall have occurred nor shall the transfer
to the Trustee of the Receivables arising in the New Accounts have
been made in contemplation of the occurrence thereof; and
(v) the addition of the Receivables arising in the New
Accounts to the Trust will not result in the occurrence of a Pay-Out
Event or a Reinvestment Event.
(f) Representations and Warranties. Each Transferor conveying
any Receivables in Additional Accounts or Participation Interests hereby
represents and warrants to the Trust and the Trustee as of the related Addition
Date as to the matters set forth in clauses (v) and (viii) of subsection 2.09(c)
above and that, in the case of Additional Accounts, the list delivered pursuant
to subsection 2.09(h) below is, as of the applicable Addition Cut-Off Date, true
and complete in all material respects.
(g) Additional Transferors. A Transferor may designate
Affiliates of such Transferor to be included as Transferors ("Additional
Transferors") under this Agreement in an amendment hereto pursuant to subsection
13.01(a) and, in connection with such designation, such Transferor shall
surrender the Original Transferor Certificate to the Trustee in exchange for a
newly issued Original Transferor Certificate modified to reflect such Additional
Transferor's interest in the Transferors' Interest; provided, however, that
prior to any such designation and exchange the conditions set forth in clauses
(iv) and (vi) of subsection 6.03(b) shall have been satisfied with respect
thereto.
(h) Delivery of Documents. In the case of the designation of
Additional Accounts, the Transferor designating such Accounts shall deliver to
the Trustee (i) the computer file or microfiche list required to be delivered
pursuant to Section 2.01 with respect to such Additional Accounts on the date
such file or list is required to be delivered pursuant to Section 2.01 and (ii)
a duly executed, written Assignment (including an acceptance by the Trustee for
the benefit of the Certificateholders), substantially in the form of Exhibit B
(the "Assignment"), on the related Addition Date. In addition, in the case of
the designation of New Accounts, the Transferor designating such Accounts shall
deliver to the Trustee on the Addition Date an Officer's Certificate of such
Transferor confirming, to the extent applicable, the items set forth in clauses
(i) through (v) of subsection 2.09(e) above.
42
Section 2.10 Removal of Accounts and Participation Interests.
On any day of any Monthly Period, each Transferor shall have the right to
require the reassignment to it or its designee of all the Trust's right, title
and interest in, to and under the Receivables then existing and thereafter
created, all monies due or to become due and all amounts received thereafter
with respect thereto and all proceeds thereof in or with respect to the Accounts
specified herein (the "Removed Accounts") or Participation Interests conveyed to
the Trust by such Transferor (the "Removed Participation Interests") (unless
otherwise set forth in the applicable Participation Interest Supplement or
Series Supplement), and designated for removal by the Transferor, upon
satisfaction of the conditions in clauses (i), (iii), (iv) and (v) below:
(i) on or before the eighth Business Day immediately preceding
the Removal Date, such Transferor shall have given the Trustee, the
Servicer, the Rating Agency and each Series Enhancer notice (unless
such notice requirement is otherwise waived) of such removal and
specifying the date for removal of the Removed Accounts and removed
Participation Interests (the "Removal Date");
(ii) on or prior to the date that is five Business Days after
the Removal Date, such Transferor shall amend Schedule 1 by
delivering to the Trustee a computer file or microfiche list
containing a true and complete list of the Removed Accounts
specifying for each such Account, as of the date notice of the
Removal Date is given, its account number and the aggregate amount
of Receivables outstanding in such Account;
(iii) such Transferor shall have represented and warranted as
of the Removal Date that the list of Removed Accounts delivered
pursuant to paragraph (ii) above, as of the Removal Date, is true
and complete in all material respects;
(iv) the Rating Agency Condition shall have been satisfied
with respect to the removal of the Removed Accounts and removed
Participation Interests;
(v) such Transferor shall have delivered to the Trustee an
Officer's Certificate of such Transferor, dated the Removal Date, to
the effect that such Transferor reasonably believes that (a) such
removal will not have an Adverse Effect, (b) such removal will not
result in the occurrence of a Pay-Out Event or a Reinvestment Event,
and (c) no selection procedures believed by such Transferor to be
materially adverse to, or materially beneficial to, the interests of
the Investor Certificateholders have been used in selecting the
Removed Accounts from among any pool of Accounts of a similar type.
43
In addition to the terms and conditions contained in clauses
(i)-(v) above, the Transferors' right to require the reassignment to them or
their designees of all the Trustee's right, title and interest in, to and under
the Receivables in Removed Accounts and Removed Participation Interests, shall
be subject to the following restrictions:
(a) Except for Removed Accounts described in clause (b) below,
there shall be no more than one Removal Date in any Monthly Period and the
Accounts to be designated as Removed Accounts shall be selected at random by the
applicable Transferor; and
(b) A Transferor may designate Removed Accounts as provided in
and subject to the terms and conditions contained in this Section 2.10 without
being subject to the restrictions set forth in clause (a) above if the Removed
Accounts are Accounts (i) originated or acquired under a specific affinity
agreement, private label agreement, merchant agreement, co-branding agreement or
other program which is co-owned, operated or promoted, provided that such
agreement has terminated in accordance with the terms therein or (ii) being
removed due to other circumstances caused by requirements of agreements in which
the right to such Removed Accounts or control thereof is determined by a party
or parties to such agreements other than the Transferors, any Affiliate of the
Transferors or any agent of the Transferors.
Upon satisfaction of the above conditions, the Trustee shall
execute and deliver to such Transferor a written reassignment in substantially
the form of Exhibit C (the "Reassignment") and shall, without further action, be
deemed to sell, transfer, assign, set over and otherwise convey to such
Transferor or its designee, effective as of the Removal Date, without recourse,
representation or warranty, all the right, title and interest of the Trust in
and to the Receivables arising in the Removed Accounts and Removed Participation
Interests, all monies due and to become due and all amounts received with
respect thereto and all proceeds thereof and any Insurance Proceeds relating
thereto. The Trustee may conclusively rely on the Officer's Certificate
delivered pursuant to this Section 2.10 and shall have no duty to make inquiries
with regard to the matters set forth therein and shall incur no liability in so
relying.
In addition to the foregoing, on the date when an Account
becomes a Defaulted Account, the Trustee shall automatically and without further
action or consideration transfer, set over and otherwise convey to the
applicable Transferor with respect to such Account, without recourse,
representation or warranty, all right, title and interest of the Trustee and the
Trust in and to the Receivables in such Defaulted Account, all monies due or to
become due with respect thereto, all proceeds thereof and any Insurance Proceeds
relating thereto; provided, that Recoveries of such Defaulted Account shall be
applied as provided herein.
Section 2.11 Account Allocations. In the event that any
Transferor is unable for any reason to transfer Receivables to the Trustee in
accordance with the provisions of this Agreement, including by reason of the
application of the provisions of Section 9.01 or any order of any Governmental
Authority (a "Transfer Restriction Event"), then, in any such event, (a) such
Transferor agrees (except as prohibited by any such order) to allocate and pay
to the Trust, after the date of such inability, all Collections, including
Collections of Receivables transferred to the Trust prior to the occurrence of
such event, and all amounts which would have constituted Collections but for
such Transferor's inability to transfer Receivables (up to an aggregate amount
equal to the amount of Receivables transferred to the Trust by such Transferor
in the Trust on such date), (b) such Transferor and the Servicer agree that such
amounts will be applied as Collections in accordance with Article IV and the
terms of each Supplement and (c) for so long as the allocation and application
of all Collections and all amounts that would have constituted Collections are
made in accordance with clauses (a) and (b) above, Principal Receivables and all
amounts which would have constituted Principal Receivables but for such
Transferor'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 the terms of each Supplement. For
the purpose of the immediately preceding sentence, such Transferor and the
Servicer shall treat the first received Collections with respect to the Accounts
as allocable to the Trust until the Trust shall have been allocated and paid
Collections in an amount equal to the aggregate amount of Principal Receivables
in the Trust as of the date of the occurrence of such event. If such Transferor
and the Servicer are unable pursuant to any Requirements of Law to allocate
Collections as described above, such Transferor and the Servicer agree that,
after the occurrence of such event, payments on each Account with respect to the
principal balance of such Account shall be allocated first to the oldest
principal balance of such Account and shall have such payments applied as
Collections in accordance with Article IV and the terms of each Supplement. The
parties hereto agree that Finance Charge Receivables, whenever created, accrued
in respect of Principal Receivables which have been conveyed to the Trust shall
continue to be a part of the Trust notwithstanding any cessation of the transfer
of additional Principal Receivables to the Trust and Collections with respect
thereto shall continue to be allocated and paid in accordance with Article IV
and the terms of each Supplement.
44
Section 2.12 Discount Option.
(a) The Transferors shall have the option to designate at any
time and from time to time a percentage or percentages, which may be a fixed
percentage or a variable percentage (the "Discount Percentage"), of all or any
specified portion of Principal Receivables created after the Discount Option
Date to be treated as Finance Charge Receivables ("Discount Option
Receivables"). The Transferors shall also have the option of increasing,
reducing or withdrawing the Discount Percentage, at any time and from time to
time, on and after such Discount Option Date. The Transferors shall provide to
the Servicer, the Trustee and any Rating Agency 30 days' prior written notice of
the Discount Option Date and any such designation or increase, reduction or
withdrawal, and such designation, increase, reduction or withdrawal shall become
effective on the Discount Option Date specified therefor upon satisfaction of
the following conditions:
(i) each Transferor shall have delivered to the Trustee and
any Series Enhancer entitled thereto (if any) an Officer's
Certificate of such Transferor certifying that, based upon facts
known to such Transferor at such time, such designation, increase,
reduction or withdrawal will not, at the time of its occurrence,
cause a Pay-Out Event or a Reinvestment Event, or an event that,
with notice or the lapse of time or both, would constitute a Pay-Out
Event or a Reinvestment Event, to occur with respect to any Series;
(ii) the Rating Agency Condition shall have been satisfied
with respect to such designation, increase, reduction or withdrawal;
and
45
(iii) only in connection with a reduction or withdrawal of the
Discount Percentage, the Transferors shall have caused an Opinion of
Counsel to the effect described in clause (a) of the definition of
"Tax Opinion" in Section 1.01 to have been delivered to the Trustee.
Notwithstanding any of the foregoing conditions to the designation of the
Discount Percentage, beginning on the Substitution Date, and, beginning on such
date, the initial Discount Percentage shall be 0.0%, and any Collections with
respect to Discount Option Receivables in effect after the close of business on
March 26, 2004 shall be treated as Collections of Principal Receivables.
(b) After any Discount Option Date, Discount Option Receivable
Collections (calculated using the Discount Percentage specified on such Discount
Option Date) shall be treated as Collections of Finance Charge Receivables.
Section 2.13 Premium Option.
(a) The Transferors shall have the option to designate at any
time and from time to time a percentage or percentages, which may be a fixed
percentage or a variable percentage (the "Premium Percentage"), of all or any
specified portion of Finance Charge Receivables created on and after the Premium
Option Date to be treated as Principal Receivables ("Premium Option
Receivables"). The Transferors shall also have the option of increasing,
reducing or withdrawing the Premium Percentage, at any time and from time to
time, on and after such Premium Option Date. The Transferors shall provide to
the Servicer, the Trustee and any Rating Agency 30 days' prior written notice of
the Premium Option Date and any such designation or increase, reduction or
withdrawal, and such designation, increase, reduction or withdrawal shall become
effective on the Premium Option Date specified therefor upon satisfaction of the
following conditions:
(i) each Transferor shall have delivered to the Trustee and
any Series Enhancer entitled thereto (if any) an Officer's
Certificate of such Transferor certifying that, based upon facts
known to such Transferor at such time, such designation, increase,
reduction or withdrawal will not, at the time of its occurrence,
cause a Pay-Out Event or a Reinvestment Event, or an event that,
with notice or the lapse of time or both, would constitute a Pay-Out
Event or a Reinvestment Event, to occur with respect to any Series;
(ii) the Rating Agency Condition shall have been satisfied
with respect to such designation, increase, reduction or withdrawal;
and
(iii) only in connection with the designation or any increase
of the Premium Percentage, the Transferors shall have caused an
Opinion of Counsel to the effect described in clause (a) of the
definition of "Tax Opinion" in Section 1.01 to have been delivered
to the Trustee.
(b) After any Premium Option Date, Premium Option Receivable
Collections (calculated using the Premium Percentage specified on such Premium
Option Date) shall be treated as Collections of Principal Receivables.
[END OF ARTICLE II]
46
ARTICLE III
ADMINISTRATION AND SERVICING
OF RECEIVABLES
Section 3.01 Acceptance of Appointment and Other Matters
Relating to the Servicer.
(a) TRS has agreed to act, and has acted, as the Servicer
under the Original Pooling Agreement, and TRS hereby agrees to act as the
Servicer under this Agreement. The Certificateholders by their acceptance of the
Certificates shall be deemed to consent to TRS acting as Servicer.
(b) As agent for each Transferor and the Trust, the Servicer
shall service and administer the Receivables and any Participation Interests,
shall collect and deposit into the Collection Account payments due under the
Receivables and any Participation Interests and shall charge-off as
uncollectible Receivables, all in accordance with its customary and usual
servicing procedures for servicing credit or charge receivables comparable to
the Receivables and in accordance with the applicable Credit Guidelines. As
agent for each Transferor and the Trust, 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 10.01, the Servicer or its
designee is hereby authorized and empowered, unless such power is revoked by the
Trustee on account of the occurrence of a Servicer Default pursuant to Section
10.01, (i) to instruct the Trustee to make withdrawals and payments from the
Collection Account, the Special Funding Account and any Series Account, as set
forth in this Agreement or any Supplement, (ii) to take any action required or
permitted under any Series Enhancement, as set forth in this Agreement or any
Supplement, (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 Requirements of Law, to commence collection
proceedings with respect to such Receivables and (iv) at the expense of the
Transferors, to make any filings, reports, notices, applications and
registrations with, and to seek any consents or authorizations from, the
Securities and Exchange Commission (the "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 or other laws or
regulations. 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) The Servicer shall not, and no Successor Servicer shall,
be obligated to use separate servicing procedures, offices, employees or
accounts for servicing the Receivables from the procedures, offices, employees
and accounts used by the Servicer or such Successor Servicer, as the case may
be, in connection with servicing other comparable receivables.
(d) The Servicer shall comply with and perform its servicing
obligations with respect to the Accounts and Receivables in accordance with the
Account Agreements relating to the Accounts and the applicable Credit Guidelines
and all applicable rules and regulations affecting the Accounts and the
Receivables, except insofar as any failure to so comply or perform would not
materially and adversely affect the Trust or the Investor Certificateholders.
47
(e) The Servicer shall pay out of its own funds, without
reimbursement, all expenses incurred in connection with the servicing activities
hereunder including all expenses related to enforcement of the Receivables, fees
and disbursements of the Trustee (including the reasonable fees and expenses of
its outside counsel) and independent accountants for the Servicer.
Section 3.02 Servicing Compensation. As full compensation for
its servicing activities hereunder and as reimbursement for any expense incurred
by it in connection therewith, the Servicer shall be entitled to receive the
Servicing Fee specified in any Supplement.
Section 3.03 Representations, Warranties and Covenants of the
Servicer. TRS, as initial Servicer, hereby makes, and any Successor Servicer by
its appointment hereunder shall make, with respect to itself, on each Closing
Date (and on the date of any such appointment), the following representations,
warranties and covenants on which the Trustee shall be deemed to have relied in
accepting the Receivables in trust and in authenticating the Certificates:
(a) Organization and Good Standing. The Servicer is a
corporation or other legal entity validly existing under the applicable law of
the jurisdiction of its organization or incorporation and has, in all material
respects, full power and authority to own its properties and conduct its
servicing business as presently owned or conducted, and to execute, deliver and
perform its obligations under this Agreement and each Supplement.
(b) Due Qualification. The Servicer is duly qualified to do
business and is in good standing as a foreign corporation or other foreign
entity (or is exempt from such requirements) and has obtained all necessary
licenses and approvals in each jurisdiction in which the servicing of the
Receivables and any Participation Interests as required by this Agreement
requires such qualification except where the failure to so qualify or obtain
licenses or approvals would not have a material adverse effect on its ability to
perform its obligations as Servicer under this Agreement.
(c) Due Authorization. The execution, delivery, and
performance by the Servicer of this Agreement and each Supplement, and the other
agreements and instruments executed or to be executed by the Servicer as
contemplated hereby, have been duly authorized by the Servicer by all necessary
action on the part of the Servicer.
(d) Binding Obligation. This Agreement and each Supplement
constitutes a legal, valid and binding obligation of the Servicer, enforceable
in accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights generally from time to time in effect or by
general principles of equity.
(e) No Conflict. The execution and delivery of this Agreement
and each Supplement by the Servicer, and the performance by the Servicer of the
transactions contemplated by this Agreement and each Supplement and the
fulfillment by the Servicer of the terms hereof and thereof applicable to the
Servicer, will not conflict with, violate or 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 Servicer is a party or
by which it or its properties are bound.
48
(f) No Violation. The execution and delivery of this Agreement
and each Supplement by the Servicer, the performance by the Servicer of the
transactions contemplated by this Agreement and each Supplement and the
fulfillment by the Servicer of the terms hereof and thereof applicable to the
Servicer will not conflict with or violate any Requirements of Law applicable to
the Servicer.
(g) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of the Servicer, threatened against the
Servicer before any Governmental Authority seeking to prevent the consummation
of any of the transactions contemplated by this Agreement or any Supplement or
seeking any determination or ruling that, in the reasonable judgment of the
Servicer, would materially and adversely affect the performance by the Servicer
of its obligations under this Agreement or any Supplement.
(h) 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, if any, will maintain in effect
all qualifications required under Requirements of Law in order to service
properly each Receivable and the related Account, if any, 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 an Adverse Effect.
(i) No Rescission or Cancellation. The Servicer shall not
authorize any rescission or cancellation of any Receivable except in accordance
with the applicable Credit Guidelines or as ordered by a court of competent
jurisdiction or other Governmental Authority.
(j) Protection of Rights. The Servicer shall take no action
which, nor omit to take any action the omission of which, would impair the
rights of the Trustee in any Receivable, if any, nor shall it reschedule, revise
or defer payments due on any Receivable except in accordance with the applicable
Credit Guidelines, nor shall it sell any assets in the Trust except as provided
in this Agreement or a related Supplement.
(k) Receivables Not To Be Evidenced by Instruments. Except in
connection with its enforcement or collection of an Account, the Servicer will
take no action to cause any Receivable to be evidenced by any instrument (as
defined in the UCC) and if any Receivable is so evidenced as a result of the
Servicer's action, it shall be assigned to the Servicer as provided in this
Section.
(l) All Consents. All authorizations, consents, orders or
approvals of or registrations or declarations with any Governmental Authority
required to be obtained, effected or given by the Servicer in connection with
the execution and delivery of this Agreement and each Supplement by the Servicer
and the performance of the transactions contemplated by this Agreement and each
Supplement by the Servicer, have been duly obtained, effected or given and are
in full force and effect.
49
In the event (x) any of the representations, warranties or
covenants of the Servicer contained in subsection 3.03(h), (i) or (j) with
respect to any Receivable or the related Account is breached, and such breach
has a material adverse effect on the Trustee's interest in such Receivable
(which determination shall be made without regard to whether funds are then
available to any Investor Certificateholders pursuant to any Series Enhancement)
and is not cured within 60 days (or such longer period, not in excess of 150
days, as may be agreed to by the Trustee and the Transferors) of the earlier to
occur of the discovery of such event by the Servicer, or receipt by the Servicer
of notice of such event given by the Trustee or a Transferor, or (y) as provided
in subsection 3.03(k) with respect to any Receivable, all Receivables in the
Account or Accounts to which such event relates shall be assigned and
transferred to the Servicer on the terms and conditions set forth below.
The Servicer shall effect such assignment by making a deposit
into the Collection Account in immediately available funds on the Transfer Date
following the Monthly Period in which such assignment obligation arises in an
amount equal to the amount of such Receivables.
Upon each such assignment to the Servicer, the Trustee, on
behalf of the Trust, shall automatically and without further action sell,
transfer, assign, set over and otherwise convey to the Servicer, without
recourse, representation or warranty, all right, title and interest of the
Trustee and the Trust in and to such Receivables, all monies due or to become
due and all amounts received with respect thereto and all proceeds thereof. The
Trustee shall execute such documents and instruments of transfer or assignment
and take such other actions as shall be reasonably requested by the Servicer to
effect the conveyance of any such Receivables pursuant to this Section but only
upon receipt of an Officer's Certificate of the Servicer that states that all
conditions set forth in this section have been satisfied. The obligation of the
Servicer to accept assignment of such Receivables, and to make the deposits, if
any, required to be made to the Collection Account as provided in the preceding
paragraph, shall constitute the sole remedy respecting the event giving rise to
such obligation available to Certificateholders (or the Trustee on behalf of
Certificateholders) or any Series Enhancer, except as provided in Section 8.04.
Section 3.04 Reports and Records for the Trustee.
(a) Daily Records. For as long as deposits of Collections are
required to be made daily by the Servicer pursuant to subsection 4.03(a), on
each Business Day, the Servicer shall make or cause to be made available at the
office of the Servicer for inspection by the Trustee or any Transferor upon
request a record setting forth (i) the Collections in respect of Principal
Receivables and in respect of Finance Charge Receivables processed by the
Servicer on the second preceding Business Day in respect of each Account and
(ii) the amount of Receivables as of the close of business on the second
preceding Business Day in each Account. 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 shall make available to the
Trustee and the Transferors at the office of the Servicer on any Business Day
any computer programs necessary to make such identification. The Trustee and the
Transferors shall enter into such confidentiality agreements as the Servicer
shall deem necessary to protect its interests.
50
(b) Monthly Servicer's Certificate. Not later than the second
Business Day preceding each Distribution Date, the Servicer shall, with respect
to each outstanding Series, deliver to the Trustee, the Transferors and each
Rating Agency a certificate of a Servicing Officer in substantially the form set
forth in the related Supplement.
Section 3.05 Annual Certificate of Servicer. The Servicer
shall deliver to the Trustee, the Transferors and the Rating Agency on or before
March 31 of each calendar year, beginning with March 31, 2005, an Officer's
Certificate substantially in the form of Exhibit D.
Section 3.06 Annual Servicing Report of Independent Public
Accountants; Copies of Reports Available.
(a) On or before March 31 of each calendar year, beginning
with March 31, 2005, the Servicer shall cause a firm of nationally recognized
independent public accountants (who may also render other services to the
Servicer or a Transferor) to furnish a report (addressed to the Trustee) to the
Trustee, the Transferors, the Servicer and each Rating Agency to the effect that
they have applied certain procedures agreed upon with the Servicer and examined
certain documents and records relating to the servicing of Accounts under this
Agreement and each Supplement and that, on the basis of such agreed-upon
procedures, nothing has come to the attention of such accountants that caused
them to believe that the servicing (including the allocation of Collections) has
not been conducted in compliance with the terms and conditions as set forth in
Articles III and Article IV and Section 8.08 of this Agreement and the
applicable provisions of each Supplement, except for such exceptions as they
believe to be immaterial and such other exceptions as shall be set forth in such
statement. Such report shall set forth the agreed-upon procedures performed.
(b) On or before March 31 of each calendar year, beginning
with March 31, 2005, the Servicer shall cause a firm of nationally recognized
independent public accountants (who may also render other services to the
Servicer or a Transferor) to furnish a report to the Trustee, the Transferors,
the Servicer and each Rating Agency to the effect that they have applied certain
procedures agreed upon with the Servicer to compare the mathematical
calculations of certain amounts set forth in the Servicer's certificates
delivered pursuant to subsection 3.04(b) during the period covered by such
report with the Servicer's computer reports that were the source of such amounts
and that on the basis of such agreed-upon procedures and comparison, such
accountants are of the opinion that such amounts are in agreement, except for
such exceptions as they believe to be immaterial and such other exceptions as
shall be set forth in such statement. Such report shall set forth the
agreed-upon procedures performed.
(c) A copy of each certificate and report provided pursuant to
subsection 3.04(b), or Section 3.05 or 3.06 may be obtained by any Investor
Certificateholder or Certificate Owner by a request in writing to the Trustee
addressed to the Corporate Trust Office.
Section 3.07 Tax Treatment. Except as otherwise specified in a
Supplement with respect to a particular Series, the Transferors have entered
into this Agreement, and the Certificates will be issued, with the intention
that, for federal, state and local income and franchise tax purposes, (i) the
Investor Certificates of each Series which are characterized as indebtedness at
the time of their issuance will qualify as indebtedness secured by the
Receivables and (ii) the Trust shall not be treated as an association or
publicly traded partnership taxable as a corporation. The Transferor, by
entering into this Agreement, and each Certificateholder, by the acceptance of
any such Certificate (and each Certificate Owner, by its acceptance of an
interest in the applicable Certificate), agree to treat such Investor
Certificates for federal, state and local income and franchise tax purposes as
indebtedness. Each Holder of such Investor Certificate agrees that it will cause
any Certificate Owner acquiring an interest in a Certificate through it to
comply with this Agreement as to treatment as indebtedness under applicable tax
law, as described in this Section 3.07. Subject to Section 11.11, the Trustee
shall treat the Trust as a security arrangement for federal income tax purposes
and shall not file any federal income tax returns or obtain any federal employer
identification number for the Trust. The provisions of this Agreement shall be
construed in furtherance of the foregoing intended tax treatment.
51
Section 3.08 Notices to American Express Entities. In the
event that TRS is no longer acting as Servicer, any Successor Servicer also
shall deliver or make available to Centurion Bank, FSB and TRS each certificate
and report required to be provided thereafter pursuant to subsection 3.04(b) and
Sections 3.05 and 3.06, as well as all information reasonably requested by
Centurion Bank, FSB or TRS.
Section 3.09 Adjustments.
(a) If the Servicer adjusts downward the amount of any
Receivable because of a rebate, refund, unauthorized charge or billing error to
an account Obligor, because such Receivable was created in respect of
merchandise which was refused or returned by an account Obligor, or because the
Servicer or applicable Account Owner charges off as uncollectible Small
Balances, or if the Servicer otherwise adjusts downward the amount of any
Receivable without receiving Collections therefor or charging off such amount as
uncollectible, then, in any such case (other than cases resulting from Servicer
error), the amount of Principal Receivables used to calculate the Transferor
Amount, the Transferors' Interest, and (unless otherwise specified) any other
amount required herein or in any Supplement to be calculated by reference to the
amount of Principal Receivables, will be reduced by the amount of the
adjustment. Similarly, the amount of Principal Receivables used to calculate the
Transferor Amount and (unless otherwise specified) any other amount required
herein or in any Supplement to be calculated by reference to the amount of
Principal Receivables will be reduced by the amount of the Trust's percentage of
any Receivable which was discovered as having been created through a fraudulent
or counterfeit charge or with respect to which the covenant contained in Section
2.07(b) was breached. Any adjustment required pursuant to either of the two
preceding sentences shall be made on or prior to the end of the Monthly Period
in which such adjustment obligation arises. In the event that, following the
exclusion of such Principal Receivables from the calculation of the Transferor
Amount, the Transferor Amount would be less than the Required Transferor Amount,
not later than 1:00 P.M., New York City time, on the Distribution Date following
the Monthly Period in which such adjustment obligation arises, the Transferors
shall make a deposit into the Special Funding Account in immediately available
funds in an amount equal to the amount by which the Transferor Amount would be
less than the Required Transferor Amount, due to adjustments with respect to
Receivables conveyed by such Transferors (up to the amount of such Principal
Receivables).
52
(b) If (i) the Servicer makes a deposit into the Collection
Account in respect of a Collection of a Receivable and such Collection was
received by the Servicer in the form of a check which is not honored for any
reason or (ii) the Servicer makes a mistake with respect to the amount of any
Collection and deposits an amount that is less than or more than the actual
amount of such Collection, the Servicer shall appropriately adjust the amount
subsequently deposited into the Collection Account to reflect such dishonored
check or mistake. Any Receivable in respect of which a dishonored check is
received shall be deemed not to have been paid. Notwithstanding the first two
sentences of this paragraph, adjustments made pursuant to this paragraph shall
not require any change in any report previously delivered pursuant to subsection
3.04(a) or (b).
Section 3.10 Recoveries. If at any time the Servicer cannot
identify the Recoveries that relate to specific Defaulted Receivables, then the
Servicer shall reasonably estimate, on or prior to each Determination Date, the
amount of Recoveries to be attributed to such Defaulted Receivables.
Section 3.11 Reports to the Commission. The Servicer shall, on
behalf of the Trust and at the expense of the Transferors, cause to be filed
with the Commission any periodic reports required to be filed under the
provisions of the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission thereunder. The Transferors shall, at their
expense, cooperate in any reasonable request of the Servicer in connection with
such filings.
[END OF ARTICLE III]
53
ARTICLE IV
RIGHTS OF CERTIFICATEHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS
Section 4.01 Rights of Certificateholders. The Investor
Certificates shall represent fractional undivided interests in the Trust, which,
with respect to each Series, shall consist of the right to receive, to the
extent necessary to make the required payments with respect to the Investor
Certificates of such Series at the times and in the amounts specified in the
related Supplement, the portion of Collections allocable to Investor
Certificateholders of such Series pursuant to this Agreement and such
Supplement, funds on deposit in the Collection Account and the Special Funding
Account allocable to Certificateholders of such Series pursuant to this
Agreement and such Supplement, funds on deposit in any related Series Account
and funds available pursuant to any related Series Enhancement (collectively,
with respect to all Series, the "Certificateholders' Interest"), it being
understood that, except as specifically set forth in the Supplement with respect
thereto, the Investor Certificates of any Series or Class shall not represent
any interest in any Series Account or Series Enhancement for the benefit of any
other Series or Class. The Transferor Certificates shall represent the ownership
interest in the remainder of the Trust Assets not allocated pursuant to this
Agreement or any Supplement to the Certificateholders' Interest, including the
right to receive Collections with respect to the Receivables and other amounts
at the times and in the amounts specified in any Supplement to be paid to the
Transferors on behalf of all holders of the Transferor Certificates (the
"Transferors' Interest"); provided, however, that the Transferor Certificates
shall not represent any interest in the Collection Account, any Series Account
or any Series Enhancement, except as specifically provided in this Agreement or
any Supplement.
Section 4.02 Establishment of Collection Account and Special
Funding Account. The Servicer, for the benefit of the Certificateholders, shall
establish and maintain in the name of the Trustee, on behalf of the Trust, an
Eligible Deposit Account bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Certificateholders (the
"Collection Account"). The Trustee shall possess all right, title and interest
in all monies, instruments, securities, documents, certificates of deposit and
other property on deposit from time to time in the Collection Account and in all
proceeds, earnings, income, revenue, dividends and distributions thereof for the
benefit of the Certificateholders.
The Collection Account shall be under the sole dominion and
control of the Trustee for the benefit of the Certificateholders. Except as
expressly provided in this Agreement, the Servicer agrees that it shall have no
right of setoff or banker's lien against, and no right to otherwise deduct from,
any funds held in the Collection Account for any amount owed to it by the
Trustee, the Trust, any Certificateholder or any Series Enhancer. If, at any
time, the Collection Account ceases to be an Eligible Deposit Account, the
Trustee (or the Servicer on its behalf) shall within 10 Business Days (or such
longer period, not to exceed 30 calendar days, as to which each Rating Agency
may consent) establish a new Collection Account meeting the conditions specified
above, transfer any monies, documents, instruments, investment property,
financial assets, certificates of deposit and other property to such new
Collection Account and from the date such new Collection Account is established,
it shall be the "Collection Account." Pursuant to the authority granted to the
Servicer in subsection 3.01(b), the Servicer shall have the power, revocable by
the Trustee, to make withdrawals and payments from the Collection Account and to
instruct the Trustee to make withdrawals and payments from the Collection
Account for the purposes of carrying out the Servicer's or the Trustee's duties
hereunder. The Servicer shall reduce deposits into the Collection Account
payable by a Transferor on any Deposit Date to the extent that such Transferor
is entitled to receive funds from the Collection Account on such Deposit Date,
but only to the extent such reduction would not reduce the Transferor Amount to
an amount less than the Required Transferor Amount.
54
Funds on deposit in the Collection Account (other than
investment earnings and amounts deposited pursuant to Sections 2.06, 9.01, 10.01
or 12.02) shall at the written direction of the Servicer be invested by the
Trustee in Eligible Investments selected by the Servicer. All such Eligible
Investments shall be held by the Trustee for the benefit of the
Certificateholders pursuant to Section 4.07. Investments of funds representing
Collections collected during any Monthly Period shall be invested in Eligible
Investments that will mature so that such funds will be available no later than
the close of business on the next Transfer Date following such Monthly Period in
amounts sufficient to the extent of such funds to make the required
distributions on such Distribution Date. No such Eligible Investment shall be
disposed of prior to its maturity; provided, however, that the Trustee may sell,
liquidate or dispose of any such Eligible Investment before its maturity, at the
written direction of the Servicer, if such sale, liquidation or disposal would
not result in a loss of all or part of the principal portion of such Eligible
Investment or if, prior to the maturity of such Eligible Investment, a default
occurs in the payment of principal, interest or any other amount with respect to
such Eligible Investment. Unless directed by the Servicer, funds deposited in
the Collection Account on a Transfer Date with respect to the immediately
succeeding Distribution Date are not required to be invested overnight. On each
Distribution Date, all interest and other investment earnings (net of losses and
investment expenses) on funds on deposit in the Collection Account shall be paid
to the Transferors, except as otherwise specified in any Supplement. The Trustee
shall bear no responsibility or liability for any losses resulting from
investment or reinvestment of any funds in accordance with this Section 4.02.
The Servicer, for the benefit of the Certificateholders, shall
establish and maintain in the name of the Trustee, on behalf of the Trust, an
Eligible Deposit Account bearing a designation clearly indicating that the funds
deposited therein are held for the benefit of the Certificateholders (the
"Special Funding Account"). The Trustee shall possess all right, title and
interest in all monies, instruments, investment property, financial assets,
documents, certificates of deposit and other property on deposit from time to
time in the Special Funding Account and in all proceeds, dividends
distributions, earnings, income and revenue thereof for the benefit of the
Certificateholders. The Special Funding Account shall be under the sole dominion
and control of the Trustee for the benefit of the Certificateholders. Except as
expressly provided in this Agreement, the Servicer agrees that it shall have no
right of setoff or banker's lien against, and no right to otherwise deduct from,
any funds held in the Special Funding Account for any amount owed to it by the
Trustee, the Trust, any Certificateholder or any Series Enhancer. If, at any
time, the Special Funding Account ceases to be an Eligible Deposit Account, the
Trustee (or the Servicer on its behalf) shall within 10 Business Days (or such
longer period, not to exceed 30 calendar days, as to which each Rating Agency
may consent) establish a new Special Funding Account meeting the conditions
specified above, transfer any monies, documents, instruments, securities,
certificates of deposit and other property to such new Special Funding Account
and from the date such new Special Funding Account is established, it shall be
the "Special Funding Account."
55
Funds on deposit in the Special Funding Account shall at the
written direction of the Servicer be invested by the Trustee in Eligible
Investments selected by the Servicer. All such Eligible Investments shall be
held by the Trustee for the benefit of the Certificateholders pursuant to
Section 4.07. Funds on deposit in the Special Funding Account on any
Distribution Date will be invested in Eligible Investments that will mature so
that such funds will be available on the next Distribution Date. No such
Eligible Investment shall be disposed of prior to its maturity; provided,
however, that the Trustee may sell, liquidate or dispose of any such Eligible
Investment before its maturity, at the written direction of the Servicer, if
such sale, liquidation or disposal would not result in a loss of all or part of
the principal portion of such Eligible Investment or if, prior to the maturity
of such Eligible Investment, a default occurs in the payment of principal,
interest or any other amount with respect to such Eligible Investment. Unless
directed by the Servicer, funds deposited in the Special Funding Account on a
Transfer Date with respect to the immediately succeeding Distribution Date are
not required to be invested overnight. On each Distribution Date, all interest
and other investment earnings (net of losses and investment expenses) on funds
on deposit in the Special Funding Account shall be treated as Collections of
Finance Charge Receivables with respect to the last day of the related Monthly
Period except as otherwise specified in the related Supplement. On each Business
Day on which funds are on deposit in the Special Funding Account and on which no
Series is in an Accumulation Period or Amortization Period, the Servicer shall
determine the amount (if any) by which the Transferor Amount exceeds the
Required Transferor Amount on such date and the Transferors may instruct the
Trustee to withdraw any such excess from the Special Funding Account and pay
such amount to the Holders of the Transferor Certificates; provided, however,
that, (i) if an Accumulation Period or Amortization Period has commenced and is
continuing with respect to one or more outstanding Series, any funds on deposit
in the Special Funding Account shall be treated as Shared Principal Collections
and shall be allocated and distributed in accordance with Section 4.04 and the
terms of each Supplement to the extent that doing so would not cause the
Transferor Amount to be less than the Required Transferor Amount and (ii) if, at
any time, the Transferors determine that, by decreasing the amount on deposit in
the Special Funding Account, any Series then outstanding which is issued
pursuant to a Supplement which permits partial amortization as provided in this
Section 4.02 may be prevented from experiencing a Pay-Out Event based upon
insufficiency of yield, the Servicer shall on the next succeeding Distribution
Date instruct the Trustee in writing to apply funds on deposit in the Special
Funding Account as "Partial Amortization SFA Amounts" to such Series to reduce
the Invested Amount thereof (or, if more than one such Series, to each such
Series on a pro rata basis according to the Invested Amounts of such Series) in
an amount such that the Special Funding Account is reduced to an amount that,
based on the then current investment yield, (i) would not cause a yield
insufficiency Pay-Out Event to occur for any Series that is then outstanding and
(ii) would not cause the Transferor Amount to be less than the Required
Transferor Amount. In addition, the Servicer shall instruct the Trustee in
writing to apply funds on deposit in the Special Funding Account to each such
Series on such pro rata basis as Partial Amortization SFA Amounts on any
Distribution Date to the extent (subject to the limitations specified in the
preceding sentence) the Transferors so determine in written instructions
provided to the Servicer on or prior to the Determination Date preceding such
Distribution Date.
56
Section 4.03 Collections and Allocations.
(a) The Servicer will apply or will instruct the Trustee to
apply all funds on deposit in the Collection Account as described in this
Article IV and in each Supplement. Except as otherwise provided below, the
Servicer shall deposit Collections into 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 the Date of Processing. Subject to the
express terms of any Supplement, but notwithstanding anything else in this
Agreement to the contrary, for so long as TRS or an Affiliate of TRS remains the
Servicer and (i) maintains a short-term credit rating (which may be an implied
rating) of not less than A-1 by Standard and Poor's and P-1 by Moody's (or such
other rating below A-1 or P-1, as the case may be, which is satisfactory to such
Rating Agency), (ii) obtains a guarantee with respect to the Servicer's deposit
and payment obligations hereunder pursuant to a guaranty in form and substance
acceptable to each Rating Agency provided the guarantor maintains a short-term
credit rating of P-1 by Moody's and of A-1 by Standard & Poor's (or such other
rating below P-1 or A-1, as the case may be, which is satisfactory to such
Rating Agency), or (iii) the Rating Agency Condition will be satisfied despite
the Servicer's inability to satisfy the rating requirement specified in clause
(i) and for five Business Days following any reduction of any such rating or
failure to satisfy the conditions specified in clause (ii) or (iii), the
Servicer need not make the daily deposits of Collections into the Collection
Account as provided in the preceding sentence, but may make a single deposit in
the Collection Account in immediately available funds not later than 1:00 P.M.,
New York City time, on the Transfer Date following the Monthly Period with
respect to which such deposit relates. Subject to the first proviso in Section
4.04, but notwithstanding anything else in this Agreement to the contrary, with
respect to any Monthly Period, whether the Servicer is required to make deposits
of Collections pursuant to the first or the second preceding sentence, (i) the
Servicer will only be required to deposit Collections into the Collection
Account up to the aggregate amount of Collections required to be deposited into
any Series Account or, without duplication, distributed on or prior to the
related Distribution Date to Investor Certificateholders or to any Series
Enhancer pursuant to the terms of any Supplement or Enhancement Agreement and
(ii) if at any time prior to such Distribution Date the amount of Collections
deposited or to be deposited in the Collection Account exceeds the amount
required to be deposited pursuant to clause (i) above, the Servicer, on a daily
basis, as applicable, (x) will distribute to the Transferors any Collections not
required to be so deposited as such Collections are collected or (y) will
withdraw such excess from the Collection Account and distribute such excess to
the Transferors. Subject to the immediately preceding sentence, the Servicer may
retain its Servicing Fee with respect to a Series and shall not be required to
deposit it in the Collection Account.
(b) Collections of Finance Charge Receivables, Principal
Receivables and Defaulted Receivables will be allocated to each Series on the
basis of the Series Allocable Finance Charge Collections of such Series, Series
Allocable Principal Collections of such Series and Series Allocable Defaulted
Amount of such Series and amounts so allocated to any Series will not, except as
specified in the related Supplement, be available to the Investor
Certificateholders of any other Series. Allocations of the foregoing amounts
between the Certificateholders' Interest and the Transferors' Interest, among
the Series and among the Classes in any Series, shall be set forth in the
related Supplement or Supplements.
57
(c) RFC III hereby authorizes and instructs the Servicer to
remit directly to Centurion Bank, at any time during a Monthly Period,
Collections due to be distributed to RFC III as Transferor in an amount equal to
the lesser of (i) the amount of such Collections and (ii) the amount then owed
by RFC III to Centurion Bank under the Centurion Bank - RFC III Purchase
Agreement and the Centurion Bank - RFC III Revolving Credit Agreement. Any such
Collections remitted to Centurion Bank shall be applied to reduce the amount
owed by RFC III to Centurion Bank under the Centurion Bank - RFC III Purchase
Agreement and the Centurion Bank - RFC III Revolving Credit Agreement, and any
such Collections in excess of the amount described in clause (ii) above shall be
remitted to RFC III as Transferor in accordance with this Section 4.03. RFC III
may rescind or amend this authorization and instruction at any time by written
notice delivered to Centurion Bank and the Servicer.
RFC IV hereby authorizes and instructs the Servicer to remit
directly to FSB, at any time during a Monthly Period, Collections due to be
distributed to RFC IV as Transferor in an amount equal to the lesser of (I) the
amount of such Collections and (II) the amount then owed by RFC IV to FSB under
the FSB - RFC IV Purchase Agreement and the FSB - RFC IV Revolving Credit
Agreement. Any such Collections remitted to FSB shall be applied to reduce the
amount owed by RFC IV to FSB under the FSB - RFC IV Purchase Agreement and the
FSB - RFC IV Revolving Credit Agreement, and any such Collections in excess of
the amount described in clause (II) above shall be remitted to RFC IV as
Transferor in accordance with this Section 4.03. RFC IV may rescind or amend
this authorization and instruction at any time by written notice delivered to
FSB and the Servicer.
Section 4.04 Shared Principal Collections. On each
Distribution Date, (a) the Servicer shall allocate Shared Principal Collections
(as described below) to each Principal Sharing Series pro rata, in proportion to
the Principal Shortfalls, if any, with respect to such Series, and (b) the
Servicer shall withdraw from the Collection Account and pay to the Holders of
the Transferor Certificates (i) an amount equal to the excess, if any, of (x)
the aggregate amount for all outstanding Series of Collections of Principal
Receivables which the related Supplements specify are to be treated as "Shared
Principal Collections" for such Distribution Date over (y) the aggregate amount
for all outstanding Series which the related Supplements specify are "Principal
Shortfalls" for such Series and for such Distribution Date and, without
duplication, (ii) the aggregate amount for all outstanding Series of that
portion of Series Allocable Principal Collections which the related Supplements
specify are to be allocated and paid to the Holders of the Transferor
Certificates with respect to such Distribution Date; provided, however, that, in
the case of clauses (i) and (ii), if the Transferor Amount as of such
Distribution Date (determined after giving effect to the Trust's percentage of
any Principal Receivables or Participation Interests transferred to the Trust on
such date) is less than the Required Transferor Amount, the Servicer will not
distribute to the Holders of the Transferor Certificates any such amounts that
otherwise would be distributed to the Holders of the Transferor Certificates,
but shall deposit such funds in the Special Funding Account. The Transferors
may, at their option, instruct the Trustee to deposit Shared Principal
Collections which are otherwise payable to the Holders of the Transferor
Certificates pursuant to the provisions set forth above into the Special Funding
Account.
58
Section 4.05 Allocation of Trust Assets to Series or GroupS.
To the extent so provided in the Supplement for any Series or in an amendment to
this Agreement executed pursuant to subsection 13.01(a), Receivables conveyed to
the Trust pursuant to Section 2.01 and Receivables or Participation Interests
conveyed to the Trust pursuant to Section 2.09 or any Participation Interest
Supplement, and all Collections received with respect thereto may be allocated
or applied in whole or in part to one or more Series or Groups as may be
provided in such Supplement or amendment; provided, however, that any such
allocation or application shall be effective only upon satisfaction of the
following conditions:
(i) on or before the fifth Business Day immediately preceding
such allocation, the Servicer shall have given the Transferors, the
Trustee and each Rating Agency written notice of such allocation;
(ii) the Rating Agency Condition shall have been satisfied
with respect to such allocation; and
(iii) the Servicer shall have delivered to the Trustee an
Officer's Certificate of the Servicer, dated the date of such
allocation, to the effect that the Servicer reasonably believes that
such allocation will not have an Adverse Effect.
Any such Supplement or amendment may provide that (i) such
allocation to one or more particular Series or Groups may terminate upon the
occurrence of certain events specified therein and (ii) that upon the occurrence
of any such event, such assets and any Collections with respect thereto, shall
be reallocated to other Series or Groups or to all Series, all as shall be
provided in such Supplement or amendment.
Section 4.06 Issuer Rate Fees. Each Transferor shall be
permitted to transfer to the Trust for inclusion as Trust Assets all or a
portion of any interchange, merchant discount, issuer rate or other fees or
charges derived from transactions relating to the Accounts. All of such
interchange, merchant discount, issuer rate or other fees or charges shall be
deemed to be, and shall be treated as, Finance Charge Receivables under this
Agreement and each Supplement hereto.
Section 4.07. Manner of Holding Trust Assets. Each Trust Asset
that constitutes a security entitlement shall be held by the Trustee through a
securities intermediary, which securities intermediary shall agree with the
Trustee (and The Bank of New York, as the initial securities intermediary,
hereby agrees with the Trustee) that (i) such investment property at all times
shall be credited to a securities account of the Trustee, (ii) all property
credited to such securities account shall be treated as a financial asset, (iii)
such securities intermediary shall treat the Trustee as entitled to exercise the
rights that comprise each financial asset credited to such securities account,
(iv) such securities intermediary shall comply with entitlement orders
originated by the Trustee without the further consent of any other Person, (v)
such securities intermediary shall not agree with any Person other than the
Trustee to comply with entitlement orders originated by any Person other than
the Trustee, (vi) such securities account and all property credited thereto
shall not be subject to any lien, security interest, right of set-off, or
encumbrance in favor of such securities intermediary or any Person claiming
through such securities intermediary (other than the Trustee), (vii) such
agreement between such securities intermediary and the Trustee shall be governed
by the laws of the State of New York and (viii) the State of New York shall be
the securities intermediary's jurisdiction for purposes of the UCC. The Trustee
shall maintain possession in the State of New York of each Trust Asset that
constitutes money, an instrument, tangible chattel paper, or a certificated
security, separate and apart from all other property held by the Trustee. The
issuer of any Trust Asset that constitutes an uncertificated security shall
register the Trustee as the registered owner of such uncertificated security.
Any Trust Asset that constitutes a deposit account shall be established and
maintained in the name of the Trustee by a bank, the jurisdiction of which for
purposes of the UCC is the State of New York. Notwithstanding any other
provision of this Agreement, the Trustee shall not hold any Trust Asset through
an agent except as expressly permitted by this Section 4.07. Each term used in
this Section 4.07 and defined in the New York UCC shall have the meaning set
forth in the New York UCC.
[END OF ARTICLE IV]
59
ARTICLE V
DISTRIBUTIONS AND REPORTS TO
CERTIFICATEHOLDERS
Distributions shall be made to, and reports shall be provided
to, Certificateholders as set forth in the applicable Supplement. The identity
of the Certificateholders with respect to distributions and reports shall be
determined according to the immediately preceding Record Date.
[END OF ARTICLE V]
60
ARTICLE VI
THE CERTIFICATES
Section 6.01 The CertificateS. The Investor Certificates of
any Series or Class shall be issued in fully registered form (including any
uncertificated Series or Class which is registered in the Certificate Register,
the "Registered Certificates") unless the applicable Supplement provides, in
accordance with then applicable laws, that such Certificates be issued in bearer
form ("Bearer Certificates") with attached interest coupons and a special coupon
(collectively the "Coupons"). Such Registered Certificates or Bearer
Certificates, as the case may be, shall be substantially in the form of the
exhibits with respect thereto attached to the applicable Supplement. The
Original Transferor Certificate will be issued in registered form, substantially
in the form of Exhibit A, and shall upon issue, be executed and delivered by the
Transferors to the Trustee for authentication and redelivery as provided in
Section 6.02. If specified in any Supplement, the Investor Certificates of any
Series or Class shall be issued upon initial issuance as one or more
certificates evidencing the aggregate original principal amount of such Series
or Class as described in Section 6.10. The Original Transferor Certificate shall
be a single certificate and shall initially represent the entire Transferor's
Interest. Each Certificate shall be executed by manual or facsimile signature on
behalf of the Transferors by their respective Presidents, Vice Presidents or
Chief Executive Officers or by attorneys-in-fact duly authorized to execute such
Certificate on behalf of any such officers. Certificates bearing the manual or
facsimile signature of an individual who was, at the time when such signature
was affixed, authorized to sign on behalf of a Transferor shall not be rendered
invalid, notwithstanding that such individual ceased to be so authorized prior
to the authentication and delivery of such Certificates or does not hold such
office at the date of such Certificates. No Certificates shall be entitled to
any benefit under this Agreement, or be valid for any purpose, unless there
appears on such Certificate a certificate of authentication substantially in the
form provided for herein executed by or on behalf of the Trustee by the manual
signature of a duly authorized signatory, and such certificate upon any
Certificate shall be conclusive evidence, and the only evidence, that such
Certificate has been duly authenticated and delivered hereunder. Bearer
Certificates shall be dated the Series Issuance Date. All Registered
Certificates and Transferor's Certificates shall be dated the date of their
authentication.
Section 6.02 Authentication of Certificates. The Trustee shall
authenticate and deliver the Investor Certificates of each Series and Class that
are issued upon original issuance to or upon the order of the Transferors
against payment to the Transferors of the purchase price therefor. The Trustee
authenticated and delivered the Original Transferor Certificate to the
Transferors simultaneously with the delivery of the Series 1996-1 Investor
Certificates. If specified in the related Supplement for any Series or Class,
the Trustee shall authenticate and deliver outside the United States the Global
Certificate that is issued upon original issuance thereof.
Section 6.03 New Issuances.
(a) The Transferors may from time to time direct the Trustee,
on behalf of the Trust, to issue one or more new Series of Investor
Certificates. The Investor Certificates of all outstanding Series shall be
equally and ratably entitled as provided herein to the benefits of this
Agreement without preference, priority or distinction, all in accordance with
the terms and provisions of this Agreement and the applicable Supplement except,
with respect to any Series or Class, as provided in the related Supplement.
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(b) On or before the Series Issuance Date relating to any new
Series, the parties hereto will execute and deliver a Supplement which will
specify the Principal Terms of such new Series. The Trustee shall execute the
Supplement and the Transferors shall execute the Investor Certificates of such
Series and deliver such Investor Certificates to the Trustee for authentication.
In connection with the issuance of a new Series of Investor Certificates, the
designation of an Additional Transferor pursuant to Section 2.09(g) or at any
other time, each Transferor may surrender its Transferor Certificate to the
Trustee in exchange for a newly issued Transferor Certificate and a new
certificate (a "Supplemental Certificate"), the terms of which shall be defined
in a supplement (a "Transferor Certificate Supplement") to this Agreement (which
Transferor Certificate Supplement shall be subject to Section 13.01 to the
extent that it amends any of the terms of this Agreement) to be delivered to or
upon the order of such Transferor. The issuance of any such Investor
Certificates or Supplemental Certificate shall be subject to satisfaction of the
following conditions:
(i) on or before the fifth day immediately preceding the
Series Issuance Date or Transferor Certificate surrender and
exchange, as the case may be, such Transferor shall have given the
Trustee, the Servicer and each Rating Agency notice (unless such
notice requirement is otherwise waived) of such issuance and the
Series Issuance Date or such Transferor Certificate surrender and
exchange, as the case may be;
(ii) such Transferor shall have delivered to the Trustee the
related Supplement or Transferor Certificate Supplement, as
applicable, in form satisfactory to the Trustee, executed by each
party hereto (other than the Trustee and the Holder of the
Supplemental Certificate, if any);
(iii) such Transferor shall have delivered to the Trustee any
related Enhancement Agreement executed by each of the parties
thereto, other than the Trustee;
(iv) the Rating Agency Condition shall have been satisfied
with respect to such issuance or such Transferor Certificate
surrender and exchange, as the case may be;
(v) such issuance or surrender and exchange, as the case may
be, will not result in any Adverse Effect and such Transferor shall
have delivered to the Trustee an Officer's Certificate of such
Transferor, dated the Series Issuance Date or the date of such
surrender and exchange, as the case may be, to the effect that such
Transferor reasonably believes that such issuance or such surrender
and exchange, as the case may be, will not, based on the facts known
to such officer at the time of such certification, have an Adverse
Effect;
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(vi) the Transferors shall have delivered to the Trustee (with
a copy to each Rating Agency) a Tax Opinion, dated the Series
Issuance Date or the date of such surrender and exchange, as the
case may be, with respect to such issuance or surrender and
exchange, respectively, and, in connection with any such exchange,
after giving effect to such exchange, the Transferors or other
Holders of the Original Transferor Certificate shall have a
remaining interest in the Trust of not less than, in the aggregate,
2% of the total amount of Principal Receivables and funds on deposit
in the Special Funding Account and the Principal Funding Account;
and
(vii) the aggregate amount of Principal Receivables plus the
principal amount of any Participation Interest theretofore conveyed
to the Trust as of the Series Issuance Date or the date of such
surrender and exchange, as the case may be, shall be greater than
the Required Minimum Principal Balance as of the Series Issuance
Date or the date of such surrender and exchange, as the case may be,
and after giving effect to such issuance or such surrender and
exchange, respectively.
Any Supplemental Certificate held by any Person, and any
Investor Certificate held by any Transferor at any time after the date of its
initial issuance, may be transferred or exchanged only upon the delivery to the
Trustee of a Tax Opinion dated as of the date of such transfer or exchange, as
the case may be, with respect to such transfer or exchange.
Section 6.04 Registration of Transfer and Exchange of
Certificates.
(a) The Trustee shall cause to be kept at the Corporate Trust
Office a register (the "Certificate Register") in which, subject to such
reasonable regulations as it may prescribe, a transfer agent and registrar
(which may be the Trustee) (the "Transfer Agent and Registrar") shall provide
for the registration of the Registered Certificates and of transfers and
exchanges of the Registered Certificates as herein provided. The Transfer Agent
and Registrar shall initially be the Trustee and any co-transfer agent and
co-registrar chosen by the Transferors and acceptable to the Trustee, including,
if and so long as any Series or Class is listed on the Luxembourg Stock Exchange
and such exchange shall so require, a co-transfer agent and co-registrar in
Luxembourg. Any reference in this Agreement to the Transfer Agent and Registrar
shall include any co-transfer agent and registrar unless the context requires
otherwise.
The Transferors may revoke such appointment and remove any
Transfer Agent and Registrar if the Transferors, after consultation with the
Trustee, determine in their sole discretion that such transfer Agent and
Registrar failed to perform its obligations under this Agreement in any material
respect. Any Transfer Agent and Registrar shall be permitted to resign as
Transfer Agent and Registrar upon 30 days' notice to the Transferors, the
Trustee and the Servicer; provided, however, that such resignation shall not be
effective and such Transfer Agent and Registrar shall continue to perform its
duties as Transfer Agent and Registrar until the Transferors have appointed a
successor Transfer Agent and Registrar reasonably acceptable to the Trustee.
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Subject to subsection 6.04(c) below, upon surrender for
registration of transfer or exchange of any Registered Certificate at any office
or agency of the Transfer Agent and Registrar maintained for such purpose, one
or more new Registered Certificates (of the same Series and Class) in authorized
denominations of like aggregate fractional undivided interests in the
Certificateholders' Interest shall be executed, authenticated and delivered, in
the name of the designated transferee or transferees.
At the option of a Registered Certificateholder, subject to
subsection 6.04(c) below, Registered Certificates (of the same Series and Class)
may be exchanged for other Registered Certificates of authorized denominations
of like aggregate fractional undivided interests in the Certificateholders'
Interest, upon surrender of the Registered Certificates to be exchanged at any
such office or agency; Registered Certificates, including Registered
Certificates received in exchange for Bearer Certificates, may not be exchanged
for Bearer Certificates. At the option of the Holder of a Bearer Certificate,
subject to applicable laws and regulations, Bearer Certificates may be exchanged
for other Bearer Certificates or Registered Certificates (of the same Series and
Class) of authorized denominations of like aggregate fractional undivided
interests in the Certificateholders' Interest, upon surrender of the Bearer
Certificates to be exchanged at an office or agency of the Transfer Agent and
Registrar located outside the United States. Each Bearer Certificate surrendered
pursuant to this Section shall have attached thereto all unmatured Coupons;
provided that any Bearer Certificate, so surrendered after the close of business
on the Record Date preceding the relevant payment date or distribution date
after the expected final payment date need not have attached the Coupon relating
to such payment date or distribution date (in each case, as specified in the
applicable Supplement).
The preceding provisions of this Section 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 Certificate for a period of
15 days preceding the due date for any payment with respect to the Certificate.
Whenever any Investor Certificates are so surrendered for
exchange, the Transferors shall execute, the Trustee shall authenticate and the
Transfer Agent and Registrar shall deliver (in the case of Bearer Certificates,
outside the United States) the Investor Certificates which the Investor
Certificateholder making the exchange is entitled to receive. Every Investor
Certificate presented or surrendered for registration of transfer or exchange
shall be accompanied by a written instrument of transfer in a form satisfactory
to the Trustee or the Transfer Agent and Registrar duly executed by the Investor
Certificateholder or the attorney-in-fact thereof duly authorized in writing.
No service charge shall be made for any registration of
transfer or exchange of Investor Certificates, but the Transfer Agent and
Registrar may require payment of a sum sufficient to cover any tax or
governmental charge that may be imposed in connection with any such transfer or
exchange.
All Investor Certificates (together with any Coupons)
surrendered for registration of transfer and exchange or for payment shall be
canceled and disposed of in a manner satisfactory to the Trustee. The Trustee
shall cancel and destroy any Global Certificate upon its exchange in full for
Definitive Euro-Certificates and shall deliver a certificate of destruction to
the Transferors. Such certificate shall also state that a certificate or
certificates of a Foreign Clearing Agency to the effect referred to in Section
6.13 was received with respect to each portion of the Global Certificate
exchanged for Definitive Euro-Certificates.
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The Transferors shall execute and deliver to the Trustee
Bearer Certificates and Registered Certificates in such amounts and at such
times as are necessary to enable the Trustee to fulfill its responsibilities
under this Agreement, each Supplement and the Certificates.
The interest of any Investor Certificateholder in the Trust
shall not be transferable other than through the transfer of an Investor
Certificate, and except as provided in this Article VI, a Certificate shall not
be transferable or divisible.
(b) The Transfer Agent and Registrar will maintain at its
expense in the Borough of Manhattan, The City of New York, and, if and so long
as any Series or Class is listed on the Luxembourg Stock Exchange, Luxembourg,
an office or agency where Investor Certificates may be surrendered for
registration of transfer or exchange (except that Bearer Certificates may not be
surrendered for exchange at any such office or agency in the United States or
its territories and possessions).
(c) (i) Registration of transfer of Investor Certificates
containing a legend substantially to the effect set forth on Exhibit
G-1 shall be effected only if such transfer (x) is made pursuant to
an effective registration statement under the Act, or is exempt from
the registration requirements under the Act, and (y) is made to a
Person which is not an employee benefit plan, trust or account,
including an individual retirement account, that is subject to ERISA
or that is described in Section 4975(e)(1) of the Code or an entity
whose underlying assets include plan assets by reason of a plan's
investment in such entity (a "Benefit Plan"). In the event that
registration of a transfer is to be made in reliance upon an
exemption from the registration requirements under the Act, the
transferor or the transferee shall deliver, at its expense, to the
Transferors, the Servicer and the Trustee, an investment letter from
the transferee, substantially in the form of the investment and
ERISA representation letter attached hereto as Exhibit G-2, and no
registration of transfer shall be made until such letter is so
delivered.
Investor Certificates issued upon registration or transfer of,
or Investor Certificates issued in exchange for, Investor
Certificates bearing the legend referred to above shall also bear
such legend unless the Transferor, the Servicer, the Trustee and the
Transfer Agent and Registrar receive an Opinion of Counsel,
satisfactory to each of them, to the effect that such legend may be
removed.
Whenever an Investor Certificate containing the legend
referred to above is presented to the Transfer Agent and Registrar
for registration of transfer, the Transfer Agent and Registrar shall
promptly seek instructions from the Transferors regarding such
transfer and shall be entitled to receive instructions signed by an
officer of each Transferor prior to registering any such transfer.
The Transferors hereby agree to indemnify the Transfer Agent and
Registrar and the Trustee and to hold each of them harmless against
any loss, liability or expense incurred without negligence or bad
faith on their part arising out of or in connection with actions
taken or omitted by them in relation to any such instructions
furnished pursuant to this clause (i).
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(ii) Registration of transfer of Investor Certificates
containing a legend to the effect set forth on Exhibit G-3 shall be
effected only if such transfer is made to a Person which is not a
Benefit Plan. By accepting and holding any such Investor
Certificate, an Investor Certificateholder shall be deemed to have
represented and warranted that it is not a Benefit Plan. By
acquiring any interest in a Book-Entry Certificate which contains
such legend, a Certificate Owner shall be deemed to have represented
and warranted that it is not a Benefit Plan.
(iii) If so requested by the Transferors, the Trustee will
make available to any prospective purchaser of Investor Certificates
who so requests, a copy of a letter provided to the Trustee by or on
behalf of the Transferors relating to the transferability of any
Series or Class to a Benefit Plan.
Section 6.05 Mutilated, Destroyed, Lost or Stolen
Certificates. If (a) any mutilated Certificate (together, in the case of Bearer
Certificates, with all unmatured Coupons (if any) appertaining thereto) is
surrendered to the Transfer Agent and Registrar, or the Transfer Agent and
Registrar receives evidence to its satisfaction of the destruction, loss or
theft of any Certificate and (b) there is delivered to the Transfer Agent and
Registrar and the Trustee such security or indemnity as may be required by them
to save each of them harmless, then, in the absence of notice to the Trustee
that such Certificate has been acquired by a protected purchaser, the
Transferors shall execute, the Trustee shall authenticate and the Transfer Agent
and Registrar shall deliver (in the case of Bearer Certificates, outside the
United States), in exchange for or in lieu of any such mutilated, destroyed,
lost or stolen Certificate, a new Certificate of like tenor and aggregate
fractional undivided interest. In connection with the issuance of any new
Certificate under this Section, the Trustee or the Transfer Agent and Registrar
may require the payment by the Certificateholder of a sum sufficient to cover
any tax or other governmental charge that may be imposed in relation thereto and
any other expenses (including the fees and expenses of the Trustee and Transfer
Agent and Registrar) connected therewith. Any duplicate Certificate issued
pursuant to this Section shall constitute complete and indefeasible evidence of
ownership in the Trust, as if originally issued, whether or not the lost, stolen
or destroyed Certificate shall be found at any time.
Section 6.06 Persons Deemed Owners. The Trustee, the Paying
Agent, the Transfer Agent, the Registrar, the Transferors and the Servicer and
any agent of any of them may (a) prior to due presentation of a Registered
Certificate for registration of transfer, treat the Person in whose name any
Registered Certificate is registered as the owner of such Registered Certificate
for the purpose of receiving distributions pursuant to the terms of the
applicable Supplement and for all other purposes whatsoever, and (b) treat the
bearer of a Bearer Certificate or Coupon as the owner of such Bearer Certificate
or Coupon for the purpose of receiving distributions pursuant to the terms of
the applicable Supplement and for all other purposes whatsoever; and, in any
such case, neither the Trustee, the Paying Agent, the Transfer Agent, the
Registrar, any Transferor, the Servicer nor any agent of any of them shall be
affected by any notice to the contrary. Notwithstanding the foregoing, in
determining whether the Holders of the requisite Investor Certificates have
given any request, demand, authorization, direction, notice, consent or waiver
hereunder, Certificates owned by any Transferor, the Servicer, any other Holder
of a Transferor Certificate or any Affiliate thereof, shall be disregarded and
deemed not to be outstanding, except that, in determining whether the Trustee
shall be protected in relying upon any such request, demand, authorization,
direction, notice, consent or waiver, only Certificates which the Trustee knows
to be so owned shall be so disregarded. 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 Certificates and that the pledgee
is not the Transferor, the Servicer, any other Holder of a Transferor
Certificate or any Affiliate thereof. None of the Transferor, the Servicer, the
Trustee, the Registrar or the Paying Agent will have any responsibility or
liability for any of the records relating to or on account of beneficial
ownership in Book-Entry Certificates or for maintaining, supervising or
reviewing records relating thereto.
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Section 6.07 Appointment of Paying Agent. The Paying Agent
shall make distributions to Investor Certificateholders from the Collection
Account or applicable Series Account pursuant to the provisions of the
applicable Supplement and shall report the amounts of such distributions to the
Trustee. Any Paying Agent shall have the revocable power to withdraw funds from
the Collection Account or applicable Series Account for the purpose of making
the distributions referred to above. The Trustee may revoke such power and
remove the Paying Agent if the Trustee determines in its sole discretion that
the Paying Agent shall have failed to perform its obligations under this
Agreement or any Supplement in any material respect. The Paying Agent shall
initially be the Trustee and any co-paying agent chosen by the Transferors and
acceptable to the Trustee, including, if and so long as any Series or Class is
listed on the Luxembourg Stock Exchange and such exchange so requires, a
co-paying agent in Luxembourg or another Western European city. In the event
that any Paying Agent shall resign, the Trustee shall appoint a successor to act
as Paying Agent. The Trustee shall act as Paying Agent until a successor is
appointed. The Trustee shall cause each successor or additional Paying Agent to
execute and deliver to the Trustee an instrument in which such successor or
additional Paying Agent shall agree with the Trustee that it will hold all sums,
if any, held by it for payment to the Investor Certificateholders in trust for
the benefit of the Investor Certificateholders entitled thereto until such sums
shall be paid to such Investor Certificateholders. The Paying Agent shall return
all unclaimed funds to the Trustee and upon removal shall also return all funds
in its possession to the Trustee. The provisions of Sections 11.01, 11.02, 11.03
and 11.05 shall apply to the Trustee also in its role as Paying Agent, for so
long as the Trustee shall act as Paying Agent. Any reference in this Agreement
to the Paying Agent shall include any co-paying agent unless the context
requires otherwise.
Section 6.08 Access to List of Registered Certificateholders'
Names and Addresses. The Trustee will furnish or cause to be furnished by the
Transfer Agent and Registrar to the Transferors, the Servicer or the Paying
Agent, within five Business Days after receipt by the Trustee of a request
therefor, a list in such form as the Transferors, the Servicer or the Paying
Agent may reasonably require, of the names and addresses of the Registered
Certificateholders. If any Holder or group of Holders of Investor Certificates
of any Series or all outstanding Series, as the case may be, evidencing not less
than 10% of the aggregate unpaid principal amount of such Series or all
outstanding Series, as applicable (the "Applicants"), apply to the Trustee, and
such application states that the Applicants desire to communicate with other
Investor Certificateholders with respect to their rights under this Agreement or
any Supplement or under the Investor Certificates and is accompanied by a copy
of the communication 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 Registered Certificateholders of such Series or all outstanding Series,
as applicable, held by the Trustee, within five Business Days after the receipt
of such application. Such list shall be as of a date no more than 45 days prior
to the date of receipt of such Applicants' request.
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With respect to any Series of Registered Certificates, every
Registered Certificateholder, by receiving and holding a Registered Certificate,
agrees with the Trustee that neither the Trustee, the Transfer Agent and
Registrar, nor any of their respective agents, shall be held accountable by
reason of the disclosure of any such information as to the names and addresses
of the Registered Certificateholders hereunder, regardless of the sources from
which such information was derived.
Section 6.09 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 certificate of authentication executed on behalf of
the Trustee by an authenticating agent. Each authenticating agent must be
acceptable to the Transferors and the Servicer.
(b) Any institution succeeding to the corporate agency
business of an authenticating agent shall continue to be an authenticating agent
without the execution or filing of any power or any further act on the part of
the Trustee or such authenticating agent. An authenticating agent may at any
time resign by giving notice of resignation to the Trustee and to the
Transferor. The Trustee may at any time terminate the agency of an
authenticating agent by giving notice of termination to such authenticating
agent and to the Transferor. Upon receiving such a notice of resignation or upon
such a termination, or in case at any time an authenticating agent shall cease
to be acceptable to the Trustee or the Transferor, the Trustee 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 Transferor. The
Transferors agree to pay to each authenticating agent from time to time
reasonable compensation for its services under this Section. The provisions of
Sections 11.01, 11.02 and 11.03 shall be applicable to any authenticating agent.
(c) Pursuant to an appointment made under this Section, the
Certificates may have indorsed 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 Signatory
Section 6.10 Book-entry Certificates. Unless otherwise
specified in the related Supplement for any Series or Class, the Investor
Certificates, upon original issuance, shall be issued in the form of one or more
master Investor Certificates representing the Book-Entry Certificates, to be
delivered to the Clearing Agency, by, or on behalf of, the Transferor. The
Investor Certificates shall initially be registered on the Certificate Register
in the name of the Clearing Agency or its nominee, and no Certificate Owner will
receive a definitive certificate representing such Certificate Owner's interest
in the Investor Certificates, except as provided in Section 6.12. Unless and
until definitive, fully registered Investor Certificates ("Definitive
Certificates") have been issued to the applicable Certificate Owners pursuant to
Section 6.12 or as otherwise specified in any such Supplement:
(a) the provisions of this Section shall be in full force and
effect;
(b) the Transferor, the Servicer and the Trustee may deal with
the Clearing Agency and the Clearing Agency Participants for all purposes
(including the making of distributions) as the authorized representatives of the
respective Certificate Owners;
(c) to the extent that the provisions of this Section conflict
with any other provisions of this Agreement, the provisions of this Section
shall control; and
(d) the rights of the respective Certificate Owners shall be
exercised only through the Clearing Agency and the Clearing Agency Participants
and shall be limited to those established by law and agreements between such
Certificate Owners and the Clearing Agency and/or the Clearing Agency
Participants. Pursuant to the Depository Agreement, unless and until Definitive
Certificates are issued pursuant to Section 6.12, the Clearing Agency will make
book-entry transfers among the Clearing Agency Participants and receive and
transmit distributions of principal and interest on the related Investor
Certificates to such Clearing Agency Participants.
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For purposes of any provision of this Agreement requiring or
permitting actions with the consent of, or at the direction of, Investor
Certificateholders evidencing a specified percentage of the aggregate unpaid
principal amount of Investor Certificates, such direction or consent may be
given by Certificate Owners (acting through the Clearing Agency and the Clearing
Agency Participants) owning Investor Certificates evidencing the requisite
percentage of principal amount of Investor Certificates.
Section 6.11 Notices to Clearing Agency. Whenever any notice
or other communication is required to be given to Investor Certificateholders of
any Series or Class with respect to which Book-Entry Certificates have been
issued, unless and until Definitive Certificates shall have been issued to the
related Certificate Owners, the Trustee shall give all such notices and
communications to the applicable Clearing Agency.
Section 6.12 Definitive Certificates. If Book-Entry
Certificates have been issued with respect to any Series or Class and (a) the
Transferors advise the Trustee that the Clearing Agency is no longer willing or
able to discharge properly its responsibilities under the Depository Agreement
with respect to such Series or Class and the Trustee or the Transferors are
unable to locate a qualified successor, (b) the Transferors, at their option,
advise the Trustee that they elect to terminate the book-entry system with
respect to such Series or Class through the Clearing Agency or (c) after the
occurrence of a Servicer Default, Certificate Owners of such Series or Class
evidencing not less than 50% of the aggregate unpaid principal amount of such
Series or Class advise the Trustee and the Clearing Agency through the Clearing
Agency Participants that the continuation of a book-entry system with respect to
the Investor Certificates of such Series or Class through the Clearing Agency is
no longer in the best interests of the Certificate Owners with respect to such
Certificates, then the Trustee shall notify all Certificate Owners of such
Certificates, through the Clearing Agency, of the occurrence of any such event
and of the availability of Definitive Certificates to Certificate Owners
requesting the same. Upon surrender to the Trustee of any such Certificates by
the Clearing Agency, accompanied by registration instructions from the Clearing
Agency for registration, the Trustee shall authenticate and deliver such
Definitive Certificates. Neither any Transferor nor the Trustee shall be liable
for any delay in delivery of such instructions and may conclusively rely on, and
shall be protected in relying on, such instructions. Upon the issuance of such
Definitive Certificates all references herein to obligations imposed upon or to
be performed by the Clearing Agency shall be deemed to be imposed upon and
performed by the Trustee, to the extent applicable with respect to such
Definitive Certificates and the Trustee shall recognize the Holders of such
Definitive Certificates as Investor Certificateholders hereunder.
Section 6.13 Global Certificate; Exchange Date.
(a) If specified in the related Supplement for any Series or
Class, the Investor Certificates for such Series or Class will initially be
issued in the form of a single temporary global Certificate (the "Global
Certificate") in bearer form, without interest coupons, in the denomination of
the entire aggregate principal amount of such Series or Class and substantially
in the form set forth in the exhibit with respect thereto attached to the
related Supplement. The Global Certificate will be executed by the Transferors
and authenticated by the Trustee upon the same conditions, in substantially the
same manner and with the same effect as the Definitive Certificates. The Global
Certificate may be exchanged as described below for Bearer or Registered
Certificates in definitive form (the "Definitive Euro-Certificates").
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(b) The Manager shall, upon its determination of the date of
completion of the distribution of the Investor Certificates of such Series or
Class, so advise the Trustee, the Transferor, the Depositaries, and each Foreign
Clearing Agency forthwith. Without unnecessary delay, but in any event not prior
to the Exchange Date, the Transferors will execute and deliver to the Trustee at
its London office or its designated agent outside the United States definitive
Bearer Certificates in an aggregate principal amount equal to the entire
aggregate principal amount of such Series or Class. All Bearer Certificates so
issued and delivered will have Coupons attached. The Global Certificate may be
exchanged for an equal aggregate principal amount of Definitive
Euro-Certificates only on or after the Exchange Date. An institutional investor
that is a U.S. Person may exchange the portion of the Global Certificate
beneficially owned by it only for an equal aggregate principal amount of
Registered Certificates bearing the applicable legend set forth in the form of
Registered Certificates attached to the related Supplement and having a minimum
denomination of $500,000, which may be in temporary form if the Transferors so
elect. The Transferors may elect to waive the $500,000 minimum denomination
requirement. Upon any demand for exchange for Definitive Euro-Certificates in
accordance with this paragraph, the Transferors shall cause the Trustee to
authenticate and deliver the Definitive Euro-Certificates to the Holder (x)
outside the United States, in the case of Bearer Certificates, and (y) according
to the instructions of the Holder, in the case of Registered Certificates, but
in either case only upon presentation to the Trustee of a written statement
substantially in the form of Exhibit F-1 with respect to the Global Certificate
or portion thereof being exchanged, signed by a Foreign Clearing Agency and
dated on the Exchange Date or a subsequent date, to the effect that it has
received in writing or by tested telex a certification substantially in the form
of (i) in the case of beneficial ownership of the Global Certificate or a
portion thereof being exchanged by a United States institutional investor
pursuant to the second preceding sentence, the certificate in the form of
Exhibit F-2 signed by the Manager which sold the relevant Certificates or (ii)
in all other cases, the certificate in the form of Exhibit F-3, the certificate
referred to in this clause (ii) being dated on the earlier of the first actual
payment of interest in respect of such Certificates and the date of the delivery
of such Certificate in definitive form. Upon receipt of such certification, the
Trustee shall cause the Global Certificate to be endorsed in accordance with
paragraph (d) below. Any exchange as provided in this Section shall be made free
of charge to the Holders and the beneficial owners of the Global Certificate and
to the beneficial owners of the Definitive Euro-Certificates issued in exchange,
except that a person receiving Definitive Euro-Certificates must bear the cost
of insurance, postage, transportation and the like in the event that such person
does not receive such Definitive Euro-Certificates in person at the offices of a
Foreign Clearing Agency.
(c) The delivery to the Trustee by a Foreign Clearing Agency
of any written statement referred to above may be relied upon by the Transferors
and the Trustee as conclusive evidence that a corresponding certification or
certifications has or have been delivered to such Foreign Clearing Agency
pursuant to the terms of this Agreement.
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(d) Upon any such exchange of all or a portion of the Global
Certificate for a Definitive Euro-Certificate or Certificates, such Global
Certificate shall be indorsed by or on behalf of the Trustee to reflect the
reduction of its principal amount by an amount equal to the aggregate principal
amount of such Definitive Euro-Certificate or Certificates. Until so exchanged
in full, such Global Certificate shall in all respects be entitled to the same
benefits under this Agreement as Definitive Euro-Certificates authenticated and
delivered hereunder except that the beneficial owners of such Global Certificate
shall not be entitled to receive payments of interest on the Certificates until
they have exchanged their beneficial interests in such Global Certificate for
Definitive Euro-Certificates.
Section 6.14 Meetings of Certificateholders.
(a) If at the time any Bearer Certificates are issued and
outstanding with respect to any Series or Class to which any meeting described
below relates, the Transferors or the Trustee may at any time call a meeting of
Investor Certificateholders of any Series or Class or of all Series, to be held
at such time and at such place as the Transferors 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, any Supplement or the Investor Certificates or of taking any
other action permitted to be taken by Investor Certificateholders hereunder or
under any Supplement or any Receivables Purchase Agreement. Notice of any
meeting of Investor Certificateholders, setting forth the time and place of such
meeting and in general terms the action proposed to be taken at such meeting,
shall be given in accordance with Section 13.05, the first mailing and
publication to be not less than 20 nor more than 180 days prior to the date
fixed for the meeting. To be entitled to vote at any meeting of Investor
Certificateholders a Person shall be (i) a Holder of one or more Investor
Certificates of the applicable Series or Class or (ii) a person appointed by an
instrument in writing as proxy by the Holder of one or more such Investor
Certificates. The only persons who shall be entitled to be present or to speak
at any meeting of Investor Certificateholders shall be the persons entitled to
vote at such meeting and their counsel and any representatives of the
Transferor, the Servicer and the Trustee and their respective counsel.
(b) At a meeting of Investor Certificateholders, persons
entitled to vote Investor Certificates evidencing a majority of the aggregate
unpaid principal amount of the applicable Series or Class or all outstanding
Series, as the case may be, shall constitute a quorum. No business shall be
transacted in the absence of a quorum, unless a quorum is present when the
meeting is called to order. In the absence of a quorum at any such meeting, the
meeting may be adjourned for a period of not less than 10 days; in the absence
of a quorum at any such meeting, such adjourned meeting may be further adjourned
for a period of not less than 10 days; at the reconvening of any meeting further
adjourned for lack of a quorum, the persons entitled to vote Investor
Certificates evidencing at least 25% of the aggregate unpaid principal amount of
the applicable Series or Class or all outstanding Series, as the case may be,
shall constitute a quorum for the taking of any action set forth in the notice
of the original meeting. Notice of the reconvening of any adjourned meeting
shall be given as provided above except that such notice must be given not less
than five days prior to the date on which the meeting is scheduled to be
reconvened. Notice of the reconvening of an adjourned meeting shall state
expressly the percentage of the aggregate principal amount of the outstanding
applicable Investor Certificates which shall constitute a quorum.
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(c) Any Investor Certificateholder who has executed an
instrument in writing appointing a person as proxy shall be deemed to be present
for the purposes of determining a quorum and be deemed to have voted; provided
that such Investor Certificateholder shall be considered as present or voting
only with respect to the matters covered by such instrument in writing. Subject
to the provisions of Section 13.01, any resolution passed or decision taken at
any meeting of Investor Certificateholders duly held in accordance with this
Section shall be binding on all Investor Certificateholders whether or not
present or represented at the meeting.
(d) The holding of Bearer Certificates shall be proved by the
production of such Bearer Certificates or by a certificate, satisfactory to the
Transferors, executed by any bank, trust company or recognized securities
dealer, wherever situated, satisfactory to the Transferors. Each such
certificate shall be dated and shall state that on the date thereof a Bearer
Certificate bearing a specified serial number was deposited with or exhibited to
such bank, trust company or recognized securities dealer by the Person named in
such certificate. Any such certificate may be issued in respect of one or more
Bearer Certificates specified therein. The holding by the Person named in any
such certificate of any Bearer Certificate specified therein shall be presumed
to continue for a period of one year from the date of such certificate unless at
the time of any determination of such holding (i) another certificate bearing a
later date issued in respect of the same Bearer Certificate shall be produced,
(ii) the Bearer Certificate specified in such certificate shall be produced by
some other Person or (iii) the Bearer Certificate specified in such certificate
shall have ceased to be outstanding. The appointment of any proxy shall be
proved by having the signature of the Person executing the proxy guaranteed by
any bank, trust company or recognized securities dealer satisfactory to the
Trustee.
(e) The Trustee shall appoint a temporary chairman of the
meeting. A permanent chairman and a permanent secretary of the meeting shall be
elected by vote of the Holders of Investor Certificates evidencing a majority of
the aggregate unpaid principal amount of Investor Certificates of the applicable
Series or Class or all outstanding Series, as the case may be, represented at
the meeting. No vote shall be cast or counted at any meeting in respect of any
Investor Certificate challenged as not outstanding and ruled by the chairman of
the meeting to be not outstanding. The chairman of the meeting shall have no
right to vote except as an Investor Certificateholder or proxy. Any meeting of
Investor Certificateholders duly called at which a quorum is present may be
adjourned from time to time, and the meeting may be held as so adjourned without
further notice.
(f) The vote upon any resolution submitted to any meeting of
Investor Certificateholders shall be by written ballot on which shall be
subscribed the signatures of Investor Certificateholders or proxies and on which
shall be inscribed the serial number or numbers of the Investor Certificates
held or represented by them. The permanent chairman of the meeting shall appoint
two inspectors of votes who shall count all votes cast at the meeting for or
against any resolution and who shall make and file with the secretary of the
meeting their verified written reports in duplicate of all votes cast at the
meeting. A record in duplicate of the proceedings of each meeting of Investor
Certificateholders shall be prepared by the secretary of the meeting and there
shall be attached to said record the original reports of the inspectors of votes
on any vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was published as provided above. The record shall be
signed and verified by the permanent chairman and secretary of the meeting and
duplicates shall be delivered to the Servicer, the Transferors and the Trustee
to be preserved by the Trustee, the latter to have attached thereto the ballots
voted at the meeting. Any record so signed and verified shall be conclusive
evidence of the matters therein stated.
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Section 6.15 Uncertificated Classes. Notwithstanding anything
to the contrary contained in this Article VI or in Article XII, unless otherwise
specified in any Supplement any provisions contained in this Article VI and in
Article XII relating to the registration, form, execution, authentication,
delivery, presentation, cancellation and surrender of Certificates shall not be
applicable to any uncertificated Certificates.
[END OF ARTICLE VI]
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ARTICLE VII
OTHER MATTERS RELATING TO EACH TRANSFEROR
Section 7.01 Liability of Each Transferor. Each Transferor
shall be severally, and not jointly, liable for all obligations, covenants,
representations and warranties of such Transferor arising under or related to
this Agreement or any Supplement. Except as provided in the preceding sentence,
each Transferor shall be liable only to the extent of the obligations
specifically undertaken by it in its capacity as a Transferor.
Section 7.02 Merger or Consolidation Of, or Assumption of the
Obligations Of, a Transferor. (a) No Transferor shall dissolve, liquidate,
consolidate with or merge into any other corporation or convey, transfer or sell
its properties and assets substantially as an entirety to any Person (in each
case, a "Surviving Entity") unless:
(i) (x) the Surviving Entity is a corporation organized and
existing under the laws of the United States of America or any State
or the District of Columbia and shall expressly assume, by agreement
supplemental hereto, executed and delivered to the Trustee (in form
reasonably satisfactory to the Trustee) the performance of every
covenant and obligation of such Transferor hereunder; and (y) such
Transferor has delivered to the Trustee an Officer's Certificate of
such Transferor and an Opinion of Counsel to the effect that such
consolidation, merger, conveyance or transfer and such supplemental
agreement comply with this Section 7.02, that such supplemental
agreement is a valid and binding obligation of the Surviving Entity
enforceable against the Surviving Entity in accordance with its
terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium, receivership,
conservatorship or other similar laws affecting creditors' rights
generally from time to time in effect and except as such
enforceability may be limited by general principles of equity;
(ii) all UCC filings, if any, required to perfect the interest
of the Trustee, on behalf of the Trust, in the Receivables to be
conveyed by the Surviving Entity shall have been duly made and
copies thereof shall have been delivered to the Trustee;
(iii) the Trustee shall have received one or more Opinions of
Counsel to the effect that (i) under the UCC, the transfer of
Receivables by the Surviving Entity shall constitute either a sale
of, or the granting of a security interest in, such Receivables by
the Surviving Entity to the Trust, (ii) the condition specified in
paragraph (ii) shall have been satisfied, and (iii) if the Surviving
Entity shall be subject to the FDIA, the interest of the Trust in
such Receivables should not be subject to avoidance by the FDIC if
the FDIC were to become the receiver or conservator of the Surviving
Entity; and
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(iv) if the Surviving Entity shall not be eligible as a debtor
under Title 11 of the United States Code (the "Bankruptcy Code"), such
Transferor shall have delivered notice of such consolidation, merger, conveyance
or transfer to each Rating Agency or, if the Surviving Entity shall be subject
to the Bankruptcy Code, such Transferor shall have delivered notice to each
Rating Agency (with copies to the Servicer and the Trustee) of such
consolidation, merger, conveyance or transfer and the Rating Agency Condition
shall have been satisfied; and
(v) the Transferors shall have delivered to the Trustee and
each Rating Agency a Tax Opinion, dated the date of such consolidation, merger,
conveyance or transfer, with respect thereto.
(b) The obligations of each Transferor hereunder shall not be
assignable nor shall any Person succeed to the obligations of the Transferors
hereunder except in each case in accordance with the provisions of the foregoing
paragraph or Section 7.05.
Section 7.03 Limitations On Liability of Each Transferor.
Subject to Section 7.01, neither any Transferor nor any of the directors,
officers, employees, incorporators or agents of any Transferor acting in such
capacities shall be under any liability to the Trust, the Trustee, the
Certificateholders, any Series Enhancer, the Servicer, any other Transferor or
any other Person for any action taken or for refraining from the taking of any
action in good faith in such capacities pursuant to this Agreement, it being
expressly understood that such liability is expressly waived and released as a
condition of, and consideration for, the execution of this Agreement and any
Supplement and the issuance of the Certificates; provided, however, that this
provision shall not protect any Transferor 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. Each Transferor and any director,
officer, employee or agent of such Transferor may rely in good faith on any
document of any kind prima facie properly executed and submitted by any Person
(other than such Transferor) respecting any matters arising hereunder.
Section 7.04 Liabilities. Notwithstanding any provision of
this Agreement (including, without limitation, Sections 7.03, 8.03, 8.04 and
13.07), by entering into this Agreement, each Transferor and any Holder of the
Original Transferor Certificate agrees to be liable, directly to the injured
party, for the entire amount of any losses, claims, damages or liabilities
(other than those incurred by a Certificateholder in the capacity of an investor
in the Certificates) arising out of or based on the arrangement created by this
Agreement or the actions of the Servicer taken pursuant hereto (to the extent
Trust Assets remaining after the Investor Certificateholders and Series
Enhancers have been paid in full are insufficient to pay such losses, claims,
damages or liabilities) as though this Agreement created a partnership under the
New York Uniform Partnership Act in which each Transferor and each such Holder
was a general partner. In the event of the appointment of a Successor Servicer,
the Successor Servicer will (from its own assets and not from the assets of the
Trust) indemnify and hold harmless each Transferor and each such Holder against
and from any losses, claims, damages or liabilities of such Person as described
in this Section arising from the actions or omissions of such Successor
Servicer.
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Section 7.05 Assumption of a Transferor's Obligations.
Notwithstanding the provisions of Section 7.02, each Transferor may assign,
convey or transfer all of its right, title and interest in, to and under the
Receivables, the Accounts and the Participation Interests in which it has an
interest and/or its interest in the Transferor Certificates (collectively, the
"Assigned Assets"), together with all servicing functions and other obligations,
if any, under this Agreement or relating to the transactions contemplated hereby
(collectively, the "Assumed Obligations"), to another entity (the "Assuming
Entity") which may be an entity that is not affiliated with such Transferor, and
such Transferor may assign, convey and transfer the Assigned Assets and the
Assumed Obligations to the Assuming Entity, without the consent or approval of
the holders of any Certificates, upon satisfaction of the following conditions:
(a) the Assuming Entity, such Transferor and the Trustee shall
have entered into a supplement to this Agreement or an assumption agreement (in
form and substance reasonably satisfactory to the Trustee) (either, the
"Assumption Agreement") providing for the Assuming Entity to assume the Assumed
Obligations, including the obligation under this Agreement to transfer the
Receivables arising under the Accounts and the Receivables arising under any
Additional Accounts to the Trust, and such Transferor shall have delivered to
the Trustee an Officer's Certificate of such Transferor and an Opinion of
Counsel each stating that such transfer and assumption comply with this Section
7.05, that such Assumption Agreement is a valid and binding obligation of such
Assuming Entity enforceable against such Assuming Entity in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, receivership, conservatorship or other
similar laws affecting creditors' rights generally from time to time in effect
and except as such enforceability may be limited by general principles of equity
(whether considered in a suit at law or in equity), and that all conditions
precedent herein provided for relating to such transaction have been complied
with;
(b) all UCC filings required to perfect the interest of the
Trustee, on behalf of the Trust, in the Receivables to be conveyed by the
Assuming Entity shall have been duly made and copies thereof shall have been
delivered to the Trustee;
(c) (i) if the Assuming Entity shall not be eligible to be a
debtor under the Bankruptcy Code, such Transferor shall have delivered notice of
such transfer and assumption to each Rating Agency or (ii) if the Assuming
Entity shall be eligible to be a debtor in a case under the Bankruptcy Code,
such Transferor shall have delivered copies of each such written notice to the
Servicer and the Trustee and the Rating Agency Condition shall have been
satisfied;
(d) the Trustee shall have received one or more Opinions of
Counsel to the effect that (i) the transfer of such Receivables by the Assuming
Entity shall constitute either a sale of, or the granting of a security interest
in, such Receivables by the Assuming Entity to the Trust, (ii) the condition
specified in paragraph (b) shall have been satisfied, and (iii) if the Assuming
Entity shall be subject to the FDIA, the interest of the Trust in such
Receivables should not be subject to avoidance by the FDIC if the FDIC were to
become the receiver or conservator of the Assuming Entity; and
(e) the Trustee shall have received a Tax Opinion.
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Upon such transfer to and assumption by the Assuming Entity,
such Transferor shall surrender the Transferor Certificate evidencing its
interest in the Trust to the Transfer Agent and Registrar for registration of
transfer and the Transfer Agent and Registrar shall issue a new Transferor
Certificate in the name of the Assuming Entity. Notwithstanding such assumption,
such Transferor shall continue to be liable for all representations and
warranties and covenants made by it and all obligations performed or to be
performed by it in its capacity as Transferor prior to such transfer.
Section 7.06 Expenses. The Transferors shall pay out of their
own funds, without reimbursement, all expenses incurred in connection with the
Trust, including the costs of filing any amendment to UCC financing statements,
the costs and expenses relating to obtaining and maintaining the listing of any
Investor Certificates on any stock exchange, and any stamp, documentary, excise,
property (whether on real, personal or intangible property) or any similar tax
levied on the Trust or the Trust's assets that are not expressly stated in this
Agreement to be payable by the Trust or a Transferor.
[END OF ARTICLE VII]
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ARTICLE VIII
OTHER MATTERS RELATING TO THE SERVICER
Section 8.01 Liability of the Servicer. The Servicer shall be
liable under this Article only to the extent of the obligations specifically
undertaken by the Servicer in its capacity as Servicer.
Section 8.02 Merger or Consolidation Of, or Assumption of the
Obligations Of, the Servicer. The Servicer shall not consolidate with or merge
into any other corporation or convey, transfer or sell its properties and assets
substantially as an entirety to any Person unless:
(a) (i) the corporation formed by such consolidation or into
which the Servicer is merged or the Person which acquires by
conveyance, transfer or sale the properties and assets of the
Servicer substantially as an entirety shall be, if the Servicer is
not the surviving entity, a corporation organized and existing under
the laws of the United States of America or any State or the
District of Columbia, and, if the Servicer is not the surviving
entity, such corporation shall expressly assume, by an agreement
supplemental hereto, executed and delivered to the Trustee, in form
satisfactory to the Trustee, the performance of every covenant and
obligation of the Servicer hereunder;
(ii) the Servicer has delivered to the Transferors and
the Trustee an Officer's Certificate of the Servicer and an
Opinion of Counsel each stating that such consolidation,
merger, conveyance, transfer or sale comply with this Section
and that all conditions precedent herein provided for relating
to such transaction have been complied with;
(iii) the Servicer shall have given the Rating Agencies
notice of such consolidation, merger or transfer of assets;
and
(b) the corporation formed by such consolidation or into which
the Servicer is merged or the Person which acquires by conveyance or transfer
the properties and assets of the Servicer substantially as an entirety shall be
or shall be immediately thereafter an Eligible Servicer.
Section 8.03 Limitation On Liability of the Servicer and
Others. Except as provided in Section 8.04 and Section 11.05, neither the
Servicer nor any of the directors, officers, employees or agents of the Servicer
in its capacity as Servicer shall be under any liability to the Trust, the
Trustee, the Certificateholders, any Series Enhancer, the Transferors or any
other Person for any action taken or for refraining from the taking of any
action in good faith in its capacity as Servicer pursuant to this Agreement;
provided, however, that this provision shall not protect the Servicer or any
such Person against any liability 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
Servicer and any director, officer, employee or agent of the Servicer may rely
in good faith on any document of any kind prima facie properly executed and
submitted by any Person (other than the Servicer) respecting any matters arising
hereunder. The Servicer shall not be under any obligation to appear in,
prosecute or defend any legal action which is not incidental to its duties as
Servicer in accordance with this Agreement and which in its reasonable judgment
may involve it in any expense or liability. The Servicer may, in its sole
discretion, undertake any such legal action which it may deem necessary or
desirable for the benefit of the Certificateholders with respect to this
Agreement and the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder.
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Section 8.04 Servicer Indemnification of the Trust and the
Trustee. The Servicer shall indemnify and hold harmless the Transferors (in the
case of clause (a)) and the Trust and the Trustee from and against any loss,
liability, expense, damage or injury arising out of or relating to any claims,
actions or proceedings brought or asserted by third parties which are suffered
or sustained by reason of (a) any acts or omissions of the Servicer with respect
to the Trust pursuant to this Agreement or (b) the administration by the Trustee
of the Trust (in the case of clause (a) or (b), other than such as may arise
from the negligence or willful misconduct of the Trustee or the Transferors, as
applicable, or as may arise as a result of action taken by the Trustee at the
request of the Investor Certificateholder or any federal, state or local income
or franchise taxes (or any interest or penalties with respect thereto) required
to be paid by the Trustee or the Investor Certificateholder in connection
herewith to any taxing authority), including any judgment, award, settlement,
reasonable attorneys' fees and other costs or expenses incurred in connection
with the defense of any action, proceeding or claim. Indemnification pursuant to
this Section shall not be payable from the Trust Assets, but shall be payable
only from the assets of the Servicer. The provisions of this Section 8.04 shall
survive termination of this Agreement and the resignation and removal of the
Trustee.
Section 8.05 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 Transferors and the Trustee,
in form satisfactory to the Transferors and the Trustee, of the obligations and
duties of the Servicer hereunder by any of its Affiliates or by any other entity
the appointment of which shall have satisfied the Rating Agency Condition and,
in either case, 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 and the Transferors.
No resignation shall become effective until the Trustee or a Successor Servicer
shall have assumed the responsibilities and obligations of the Servicer in
accordance with Section 10.02 hereof. If within 120 days of the date of the
determination that the Servicer may no longer act as Servicer under clause (a)
above the Trustee is unable to appoint a Successor Servicer, the Trustee shall
serve as Successor Servicer. Notwithstanding the foregoing, the Trustee shall,
if it is legally unable so to act, petition a court of competent jurisdiction to
appoint any established institution qualifying as an Eligible Servicer as the
Successor Servicer hereunder. The Trustee shall give prompt notice to each
Rating Agency and each Series Enhancer upon the appointment of a Successor
Servicer. Notwithstanding anything in this Agreement to the contrary, TRS or
Centurion Bank, as Servicer, may assign part or all of its obligations and
duties as Servicer under this Agreement to an Affiliate of TRS so long as TRS or
Centurion Bank, as the case may be, shall have fully guaranteed the performance
of such obligations and duties under this Agreement and such assignment will not
constitute a resignation.
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Section 8.06 Access to Certain Documentation and Information
Regarding the Receivables. The Servicer shall provide to the Trustee access to
the documentation regarding the Accounts and the Receivables in such cases where
the Trustee is required in connection with the enforcement of the rights of
Certificateholders or by applicable statutes or regulations to review such
documentation, such access being afforded without charge but only (a) upon
reasonable request, (b) during normal business hours, (c) subject to the
Servicer's normal security and confidentiality procedures or such procedures as
the Servicer may deem reasonably necessary and (d) at reasonably accessible
offices in the continental United States designated by the Servicer. Nothing in
this Section shall derogate from the obligation of the Transferor, the Trustee
and the Servicer to observe any applicable law prohibiting disclosure of
information regarding the Obligors and the failure of the Servicer to provide
access as provided in this Section as a result of such obligation shall not
constitute a breach of this Section.
Section 8.07 Delegation of Duties. In the ordinary course of
business, the Servicer may at any time delegate all or part of its duties
hereunder with respect to the Accounts and the Receivables to any Person that
agrees to conduct such duties in accordance with the applicable Credit
Guidelines and this Agreement. Such delegation shall not relieve the Servicer of
its liability and responsibility with respect to such duties, and shall not
constitute a resignation within the meaning of Section 8.05.
Section 8.08 Examination of Records. Each Transferor and the
Servicer shall indicate generally in their computer files or other records that
the Receivables arising in the Accounts have been conveyed to the Trustee, on
behalf of the Trust, pursuant to this Agreement for the benefit of the
Certificateholders. Each Transferor and the Servicer shall, prior to the sale or
transfer to a third party of any receivable held in its custody, examine its
computer records and other records to determine that such receivable is not, and
does not include, a Receivable.
[END OF ARTICLE VIII]
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ARTICLE IX
INSOLVENCY EVENTS
Section 9.01 Rights Upon the Occurrence of an Insolvency
Event.
(a) If any Transferor or any Holder of the Original Transferor
Certificate shall consent to or fail to object to the appointment of a
bankruptcy trustee or conservator, receiver or liquidator in any bankruptcy
proceeding or other insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings of or relating to such Transferor or such
Holder of the Original Transferor Certificate of or relating to all or
substantially all of such Person's respective property, or a decree or order of
a court or agency or supervisory authority having jurisdiction in the premises
for the appointment of a bankruptcy trustee or conservator, receiver or
liquidator in any insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or for the winding-up, insolvency,
bankruptcy, reorganization, conservatorship, receivership or liquidation of such
Person's respective affairs, shall have been entered against such Transferor or
any Holder of the Original Transferor Certificate; or such Transferor or such
Holder of the Original Transferor Certificate shall admit in writing its
respective inability, or shall be unable, to pay its debts generally as they
become due, or file a petition to take advantage of any applicable bankruptcy
insolvency or reorganization, receivership or conservatorship statute, make an
assignment for the benefit of its creditors or voluntarily suspend payment of
its obligations; or such Transferor or Holder of the Transferor Certificate
shall consent to, or fail to object to, the filing of any such petition, or, if
such Transferor or Holder of the Original Transferor Certificate shall so object
to the filing of any such petition, such petition shall not have been dismissed
within 60 days of the filing thereof (any such act or occurrence being an
"Insolvency Event"); then each Transferor shall on the day any such Insolvency
Event occurs (the "Appointment Date"), immediately cease to transfer Principal
Receivables to the Trust and shall promptly give notice to the Trustee and the
Servicer thereof. Notwithstanding any cessation of the transfer to the Trust of
additional Principal Receivables, Principal Receivables transferred to the Trust
prior to the occurrence of such Insolvency Event, Collections in respect of such
Principal Receivables and Finance Charge Receivables (whenever created) accrued
in respect of such Principal Receivables shall continue to be a part of the
Trust Assets. Upon the Appointment Date, this Agreement and the Trust shall
terminate, subject to the liquidation and dissolution procedures described
below. So long as any Series issued prior to April 16, 2004 remains outstanding,
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 and
(ii) send written notice to the Investor Certificateholders describing the
provisions of this Section 9.01 and requesting instructions from such Holders.
Unless within 60 days from the day notice pursuant to clause (i) above is first
published the Trustee shall have received written instructions from Holders of
Investor Certificates evidencing more than 50% of the Invested Amount of each
Series issued and outstanding (or, if any such Series has two or more Classes,
each Class) to the effect that such Certificateholders disapprove of the
liquidation of the Receivables and wish to continue having Principal Receivables
transferred to the Trust as before such Insolvency Event, the Trustee shall use
its best efforts to sell, dispose of or otherwise liquidate the Receivables by
the solicitation of competitive bids and on terms equivalent to the best
purchase offer as determined by the Trustee. The Trustee may obtain a prior
determination from any such conservator, receiver or liquidator of a Transferor
that the terms and manner of any proposed sale, disposition or liquidation are
commercially reasonable. The provisions of this Section 9.01 and any provisions
in a Supplement regarding an Insolvency Event shall not be deemed to be mutually
exclusive.
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(b) The proceeds from the sale, disposition or liquidation of
the Receivables and any Participation Interests pursuant to paragraph (a)
("Insolvency Proceeds") shall be immediately deposited in the Collection
Account. The Trustee shall determine conclusively the amount of the Insolvency
Proceeds which are deemed to be Finance Charge Receivables and Principal
Receivables, allocating Insolvency Proceeds to Finance Charge Receivables and
Principal Receivables in the same proportion as the amount of Finance Charge
Receivables and Principal Receivables bear to one another on the prior
Determination Date. The Insolvency Proceeds shall be allocated and distributed
to Investor Certificateholders in accordance with the terms of each Supplement.
[END OF ARTICLE IX]
83
ARTICLE X
SERVICER DEFAULTS
Section 10.01 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 to give notice to the Trustee to make such
payment, transfer or deposit on or before the date occurring five Business Days
after the date such payment, transfer or deposit or such instruction or notice
is required to be made or given, as the case may be, under the terms of this
Agreement or any Supplement; provided, however, that any such failure caused by
a nonwillful act of the Servicer shall not constitute a Servicer Default if the
Servicer promptly remedies such failure within five Business Days after
receiving notice of such failure or otherwise becoming aware of such failure;
(b) failure on the part of the Servicer duly to observe or
perform in any material respect any other covenants or agreements of the
Servicer set forth in this Agreement or any Supplement which has an Adverse
Effect and which continues unremedied for a period of 60 days after the date on
which notice of such failure, requiring the same to be remedied, shall have been
given to the Servicer by the Trustee, or to the Servicer and the Trustee by
Holders of Investor Certificates evidencing not less than 50% of the aggregate
unpaid principal amount of all Investor Certificates (or, with respect to any
such failure that does not relate to all Series, 50% of the aggregate unpaid
principal amount of all Series adversely affected by such failure); or the
Servicer shall assign or delegate its duties under this Agreement, except as
permitted by Sections 8.02 and 8.07;
(c) any representation, warranty or certification made by the
Servicer in this Agreement or any Supplement or in any certificate delivered
pursuant to this Agreement or any Supplement shall prove to have been incorrect
when made, which has an Adverse Effect on the rights of the Investor
Certificateholders of any Series (which determination shall be made without
regard to whether funds are then available pursuant to any Series Enhancement)
and which Adverse Effect continues for a period of 60 days after the date on
which notice thereof, requiring the same to be remedied, shall have been given
to the Servicer by the Trustee, or to the Servicer and the Trustee by the
Holders of Investor Certificates evidencing not less than 50% of the aggregate
unpaid principal amount of all Investor Certificates (or, with respect to any
such representation, warranty or certification that does not relate to all
Series, 50% of the aggregate unpaid principal amount of all Series adversely
affected by such representation, warranty or certification); or
(d) the Servicer shall consent to the appointment of a
bankruptcy trustee or conservator or receiver or liquidator in any bankruptcy
proceeding or other 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 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 bankruptcy trustee or a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshalling of assets and
liabilities or similar proceedings, or 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
bankruptcy, insolvency or reorganization statute, make any assignment for the
benefit of its creditors or voluntarily suspend payment of its obligations or
such Transferor or Holder of the Transferor Certificate shall consent to, or
fail to object to, the filing of any such petition, or, if such Transferor or
Holder of the Original Transferor Certificate shall so object to the filing of
any such petition, such petition shall not have been dismissed within 60 days of
the filing thereof;
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then, in the event of any Servicer Default, so long as the Servicer Default
shall not have been remedied, either the Trustee, or the Holders of Investor
Certificates evidencing more than 50% of the aggregate unpaid principal amount
of all Investor Certificates, by notice then given to the Servicer (and to the
Trustee if given by the Investor Certificateholders) (a "Termination Notice"),
may terminate all but not less than all the rights and obligations of the
Servicer as Servicer under this Agreement; provided, however, if within 60 days
of receipt of a Termination Notice the Trustee does not receive any bids from
Eligible Servicers in accordance with subsection 10.02(c) to act as a Successor
Servicer and receives Officers' Certificates of the Transferors to the effect
that the Servicer cannot in good faith cure the Servicer Default which gave rise
to the Termination Notice, the Trustee shall, except in the case of a Servicer
Default set forth in subsection 10.01(d), grant the Transferors the right of
first refusal to purchase the Certificateholders' Interest on the Distribution
Date in the next calendar month.
The purchase price for the Certificateholders' Interest shall
be equal to the sum of the amounts specified therefor with respect to each
outstanding Series in the related Supplement. The Transferors shall notify the
Trustee prior to the Record Date for the Distribution Date of the purchase if
the Transferors are exercising such right of first refusal. If the Transferors
exercise such right of first refusal, the Transferors shall deposit the purchase
price into the Collection Account on such Distribution Date in immediately
available funds. The purchase price shall be allocated and distributed to
Investor Certificateholders in accordance with the terms of each Supplement.
After receipt by the Servicer of a Termination Notice, and on
the date that a Successor Servicer is appointed by the Trustee pursuant to
Section 10.02, all authority and power of the Servicer under this Agreement
shall pass to and be vested in the Successor Servicer (a "Service Transfer");
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 Service Transfer. 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 the transfer to such Successor Servicer
of all authority of the Servicer to service the Receivables provided for under
this Agreement, including 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, or which shall thereafter
be received with respect to the Receivables, and in assisting the Successor
Servicer. The Servicer shall within 20 Business Days 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 shall require the Servicer to disclose
to the Successor Servicer information of any kind which the Servicer deems to be
confidential, the Successor Servicer shall be required to enter into such
licensing and confidentiality agreements as the Servicer shall deem reasonably
necessary to protect its interests.
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Notwithstanding the foregoing, a delay in or failure of
performance referred to in paragraph (a) above for a period of 10 Business Days
after the applicable grace period or under paragraph (b) or (c) above for a
period of 60 Business Days after the applicable grace period, shall not
constitute a Servicer Default if such delay or failure could not be prevented by
the exercise of reasonable diligence by the Servicer and such delay or failure
was caused by an act of God or the public enemy, acts of declared or undeclared
war, public disorder, rebellion or sabotage, epidemics, landslides, lightning,
fire, hurricanes, earthquakes, floods or similar causes. The preceding sentence
shall not relieve the Servicer from using all commercially reasonable efforts to
perform its obligations in a timely manner in accordance with the terms of this
Agreement and the Servicer shall provide the Trustee, each Transferor and any
Series Enhancer with an Officer's Certificate of the Servicer giving prompt
notice of such failure or delay by it, together with a description of its
efforts so to perform its obligations.
Section 10.02 Trustee to Act; Appointment of Successor.
(a) On and after the receipt by the Servicer of a Termination
Notice pursuant to Section 10.01, the Servicer shall continue to perform all
servicing functions under this Agreement until the date specified in the
Termination Notice or otherwise specified by the Trustee or until a date
mutually agreed upon by the Servicer and Trustee. The Trustee shall as promptly
as possible after the giving of a Termination Notice appoint an Eligible
Servicer as a successor servicer (the "Successor Servicer"), and such Successor
Servicer shall accept its appointment by a written assumption in a form
acceptable to the Trustee and the Transferors. The Transferors shall have the
right to nominate to the Trustee the name of a potential successor servicer
which nominee shall be selected by the Trustee as the Successor Servicer. In the
event that a Successor Servicer has not been appointed or has not accepted its
appointment at the time when the Servicer ceases to act as Servicer, the Trustee
without further action shall automatically be appointed the Successor Servicer.
The Trustee may delegate any of its servicing obligations to an Affiliate or
agent in accordance with subsection 3.01(b) and Section 8.07. Notwithstanding
the foregoing, the Trustee shall, if it is legally unable so to act, petition a
court of competent jurisdiction to appoint any established institution
qualifying as an Eligible Servicer as the Successor Servicer hereunder. The
Trustee shall give prompt notice to the Transferors, each Rating Agency and each
Series Enhancer upon the appointment of a Successor Servicer.
(b) Upon its appointment, the Successor Servicer shall be the
successor in all respects to the Servicer with respect to servicing functions
under this Agreement and shall be subject to all the responsibilities, duties
and liabilities 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.
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(c) In connection with any Termination Notice, the Trustee
will review any bids which it obtains from Eligible Servicers and shall be
permitted to appoint any Eligible Servicer submitting such a bid as a Successor
Servicer or, as provided in subsection 10.02(a), the Successor Servicer
nominated by the Transferors for servicing compensation not in excess of the
aggregate Servicing Fees for all Series plus the sum of the amounts with respect
to each Series and with respect to each Distribution Date equal to any
Collections of Finance Charge Receivables allocable to Investor
Certificateholders of such Series which are payable to the Holders of the
Transferor Certificates after payment of all amounts owing to the Investor
Certificateholders of such Series with respect to such Distribution Date or
required to be deposited in the applicable Series Accounts with respect to such
Distribution Date and any amounts required to be paid to any Series Enhancer for
such Series with respect to such Distribution Date pursuant to the terms of any
Enhancement Agreement; provided, however, that the Holders of the Transferor
Certificates shall be responsible for payment of their portion of such aggregate
Servicing Fees and all other such amounts in excess of such aggregate Servicing
Fees. Each holder of any of the Transferor's Certificates agrees that, if TRS
(or any Successor Servicer) is terminated as Servicer hereunder, the portion of
the Collections in respect of Finance Charge Receivables that the Transferors
are entitled to receive pursuant to this Agreement or any Supplement shall be
reduced by an amount sufficient to pay the Transferors' 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 12.01, and shall pass to and be vested in the
Transferors and, without limitation, the Transferors are 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 Transferors in effecting the termination of the
responsibilities and rights of the Successor Servicer to conduct servicing of
the Receivables. The Successor Servicer shall transfer its electronic records
relating to the Receivables to the Transferors or their designee in such
electronic form as it may reasonably request and shall transfer all other
records, correspondence and documents to it in the manner and at such times as
it shall reasonably request. To the extent that compliance with this Section
shall require the Successor Servicer to disclose to the Transferors information
of any kind which the Successor Servicer deems to be confidential, the
Transferors shall be required to enter into such customary licensing and
confidentiality agreements as the Successor Servicer shall deem necessary to
protect its interests.
Section 10.03 Notification to Certificateholders. Within five
Business Days after the Servicer becomes aware of any Servicer Default, the
Servicer shall give notice thereof to the Transferors, the Trustee, each Rating
Agency and each Series Enhancer and the Trustee shall give notice to the
Investor Certificateholders. Upon any termination or appointment of a Successor
Servicer pursuant to this Article, the Trustee shall give prompt notice thereof
to the Investor Certificateholders.
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[END OF ARTICLE X]
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ARTICLE XI
THE TRUSTEE
Section 11.01 Duties of Trustee.
(a) The Trustee, prior to the occurrence of a Servicer Default
of which a Responsible Officer of the Trustee has actual knowledge and after the
curing of all Servicer Defaults which may have occurred, undertakes to perform
such duties and only such duties as are specifically set forth in this Agreement
and no implied duties or covenants by the Trustee shall be read into this
Agreement. If a Servicer Default to the actual knowledge of a Responsible
Officer of the Trustee has occurred (which has not been cured or waived) the
Trustee shall exercise such of the rights and powers vested in it by this
Agreement and use the same degree of care and skill in their exercise, as a
prudent person would exercise or use under the circumstances in the conduct of
his or her own affairs.
(b) In the absence of bad faith or recklessness on its part,
the Trustee may conclusively rely, as to the truth of the statements and
correctness of the opinions expressed therein, upon all resolutions,
certificates, statements, opinions, reports, documents, orders or other
instruments furnished to the Trustee pursuant to this Agreement. 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 notice to each
Transferor and the Servicer of any material lack of conformity of any such
instrument to the applicable requirements of this Agreement discovered by the
Trustee which would entitle a specified percentage of Investor
Certificateholders to take any action pursuant to this Agreement.
If, within five Business Days, a Transferor or the Servicer
shall not have cured such material lack of conformity, the Trustee shall provide
notice thereof to the Investor Certificateholders.
(c) Subject to subsection 11.01(a), no provision of this
Agreement shall be construed to relieve the Trustee from liability for its own
negligent action, its own negligent failure to act or its own willful
misconduct; provided, however, that:
(i) the Trustee shall not be liable for an error of judgment
made in good faith by a Responsible Officer or Responsible Officers
of the Trustee, unless it shall be proved that the Trustee was
negligent in ascertaining the pertinent facts;
(ii) the Trustee shall not be 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 more than 50% of the aggregate unpaid
principal amount of all Investor Certificates (or, with respect to
any such action that does not relate to all Series, 50% of the
aggregate unpaid principal amount of the Investor Certificates of
all Series to which such action relates) 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; and
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(iii) the Trustee shall not be charged with knowledge of any
failure by the Servicer to comply with the obligations of the
Servicer referred to in subsection 10.01(a) or (b) nor with
knowledge of a Pay-Out Event or Reinvestment Event unless a
Responsible Officer of the Trustee obtains actual knowledge of such
failure or the Trustee receives notice of such failure or event from
any Transferor, the Servicer or any Holders of Investor Certificates
evidencing not less than 10% of the aggregate unpaid principal
amount of all Investor Certificates (or, with respect to any such
failure that does not relate to all Series, 10% of the aggregate
unpaid principal amount of the Investors Certificates of all Series
to which such failure relates).
(d) The Trustee shall not be required to expend or risk its
own funds or otherwise incur financial liability in the performance of any of
its duties hereunder or in the exercise of any of its rights or powers, 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
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 actions reasonably likely to impair the interests of
the Trust in any Receivable now existing or hereafter created or to impair the
value of any Receivable now existing or hereafter created.
(f) Except as expressly provided in this Agreement, the
Trustee shall have no power to vary the corpus of the Trust including by (i)
accepting any substitute obligation for a Receivable initially assigned to the
Trust under Section 2.01 or 2.09, (ii) adding any other investment, obligation
or security to the Trust or (iii) withdrawing from the Trust any Receivables.
(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 its knowledge thereof to perform such
obligation, duty or agreement in the manner so required.
Section 11.02 Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 11.01:
(a) the Trustee may rely on and shall be protected in acting
on, or in refraining from acting in accord with, any resolution, certificate,
statement, instrument, Officer's Certificate, opinion, report, notice, request,
consent, order, appraisal, approval, 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;
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(b) the Trustee may consult with counsel of its choice and any
Opinion of Counsel shall be full and complete authorization and protection in
respect of any action taken or suffered or omitted by it hereunder in good faith
and in accordance with such Opinion of Counsel;
(c) the Trustee shall be under no obligation to exercise any
of the rights or powers vested in it by this Agreement, or to institute, conduct
or defend any litigation hereunder or in relation hereto, at the request, order
or direction of any of the Certificateholders, pursuant to the provisions of
this Agreement, unless such Certificateholders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
which may be incurred therein or thereby; provided, however, that nothing
contained herein shall relieve the Trustee of the obligations, upon the
occurrence of a Servicer Default (which has not been cured or waived) to
exercise such of the rights and powers vested in it by this Agreement, and to
use the same degree of care and skill in their exercise as a prudent person
would exercise or use under the circumstances in the conduct of his or her own
affairs;
(d) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this Agreement;
(e) the Trustee shall not be bound to make any investigation
into the facts of matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, consent, order, appraisal,
approval, bond or other paper or document believed by it to be genuine, unless
requested in writing so to do by Holders of Investor Certificates evidencing
more than 25% of the aggregate unpaid principal amount of all Investor
Certificates (or, with respect to any such matters that do not relate to all
Series, 25% of the aggregate unpaid principal amount of the Investor
Certificates of all Series to which such matters relate); provided, however,
that if the payment within a reasonable time to the Trustee of the costs,
expenses, or liabilities likely to be incurred by it in the making of such
investigation is, in the opinion of the Trustee, not reasonably assured to the
Trustee by the security afforded to it by the terms of this Agreement, the
Trustee may require reasonable indemnity against such cost, expense, or
liability as a condition to so proceed;
(f) the Trustee may execute any of the trusts or powers
hereunder or perform any duties hereunder either directly or by or through
agents or attorneys or a custodian, and the Trustee shall not be responsible for
any misconduct or negligence on the part of any such agent, attorney or
custodian appointed with due care by it hereunder;
(g) except as may be required by subsection 11.01(a), 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
Transferors with their representations and warranties or for any other purpose;
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(h) whether or not therein expressly so provided, every
provision of this Agreement relating to the conduct or affecting the liability
of or affording protection to the Trustee shall be subject to the provisions of
this Section 11.02;
(i) the Trustee shall have no liability with respect to the
acts or omissions of the Servicer (except and to the extent the Servicer is the
Trustee), including, acts or omissions in connection with the servicing,
management or administration of Receivables; calculations made by the Servicer
whether or not reported to the Trustee; and deposits into or withdrawals from
any accounts or funds established pursuant to the terms of this Agreement; and
(j) in the event that the Trustee is also acting as Paying
Agent or Transfer Agent and Registrar hereunder, the rights and protections
afforded to the Trustee pursuant to this Article XI shall also be afforded to
such Paying Agent, Transfer Agent and Registrar.
Section 11.03 Trustee Not Liable for Recitals in CertificateS.
The Trustee assumes no responsibility for the correctness of the recitals
contained herein and in the Certificates (other than the certificate of
authentication on the Certificates). Except as set forth in Section 11.15, the
Trustee makes no representations as to the validity or sufficiency of this
Agreement or any Supplement or of the Certificates (other than the certificate
of authentication on the Certificates) or of any Receivable or related document
or as to the perfection or priority of any security interest therein or as to
the efficacy of the Trust. The Trustee shall not be accountable for the use or
application by the Transferors of any of the Certificates or of the proceeds of
such Certificates, or for the use or application of any funds paid to the
Transferors in respect of the Receivables or deposited in or withdrawn from the
Collection Account, any Series Accounts or any other accounts hereafter
established to effectuate the transactions contemplated by this Agreement and in
accordance with the terms of this Agreement.
Section 11.04 Trustee May Own Certificates. Subject to any
restrictions that may otherwise be imposed by Section 406 of ERISA or Section
4975(e) of the Code, 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 11.05 The Servicer to Pay Trustee's Fees and Expenses.
The Servicer covenants and agrees to pay to the Trustee from time to time, and
the Trustee shall be entitled to receive, reasonable compensation (which shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust) for all services rendered by it in the execution of
the trust hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee, and the Servicer shall pay or
reimburse the Trustee 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 or any Enhancement Agreement (including
the reasonable fees and expenses of its agents, any co-trustee and counsel)
except any such expense, disbursement or advance as may arise from its
negligence or bad faith and except as provided in the following sentence. If the
Trustee is appointed Successor Servicer pursuant to Section 10.02, the
provisions of this Section shall not apply to expenses, disbursements and
advances made or incurred by the Trustee in its capacity as Successor Servicer,
which shall be paid out of the Servicing Fee. The Servicer's covenant to pay the
expenses, disbursements and advances provided for in this Section shall survive
the termination of the Trust and the resignation or removal of the Trustee.
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Section 11.06 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 or any state thereof authorized
under such laws to exercise corporate trust powers, have a net worth of at least
$50,000,000, be subject to supervision or examination by Federal or state
authority and maintain any credit or deposit rating required by any Rating
Agency (which shall be Baa3, in the case of Xxxxx'x unless otherwise notified,
and BBB- in the case of Standard & Poor's unless otherwise notified) or any
higher credit or deposit rating required in connection with the issuance of a
particular Series. If such corporation publishes reports of condition at least
annually, pursuant to law or to the requirements of the aforesaid supervising or
examining authority, then, for the purpose of this Section, 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, the Trustee shall resign immediately in the manner
and with the effect specified in Section 11.07.
Section 11.07 Resignation or Removal of Trustee.
(a) The Trustee may at any time resign and be discharged from
the trust hereby created by giving written notice thereof to the Transferors and
the Servicer. Upon receiving such notice of resignation, the Transferors shall
promptly appoint a successor trustee by written instrument, in duplicate, one
copy of which instrument shall be delivered to the resigning Trustee and one
copy to the successor trustee. If no successor trustee shall have been so
appointed and have accepted appointment within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 11.06 and shall fail to resign after
request therefor by the Transferors, or if at any time the Trustee shall be
legally unable to act, or shall be adjudged a bankrupt or insolvent, or if a
receiver of the Trustee or of its property shall be appointed, or any public
officer shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation, then the
Transferors 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 successor trustee pursuant to any of the provisions of this Section shall not
become effective until acceptance of appointment by the successor trustee as
provided in Section 11.08.
Section 11.08 Successor Trustee.
(a) Any successor trustee appointed as provided in Section
11.07 shall execute, acknowledge and deliver to the Transferors, to the Servicer
and to its predecessor Trustee an instrument accepting such appointment
hereunder, and thereupon the resignation or removal of the predecessor Trustee
shall become effective and such successor trustee, without any further act, deed
or conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with like effect as if originally
named as Trustee herein. The predecessor Trustee shall deliver, at the expense
of the Servicer, to the successor trustee all documents or copies thereof and
statements held by it hereunder; and the Transferors 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.
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(b) No successor trustee shall accept appointment as provided
in this Section unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 11.06.
(c) Notwithstanding any other provisions herein, the
appointment of a successor trustee shall not be effective unless the Rating
Agency Condition shall have been satisfied.
(d) Upon acceptance of appointment by a successor trustee as
provided in this Section, such successor trustee shall provide notice of such
succession hereunder to all Certificateholders and the Servicer shall provide
such notice to each Rating Agency and each Series Enhancer.
Section 11.09 Merger or Consolidation of Trustee. Any Person
into which the Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Person succeeding to
the corporate trust business of the Trustee, shall be the successor of the
Trustee hereunder, provided such corporation shall be eligible under the
provisions of Section 11.06, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
Section 11.10 Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions of this Agreement, at
any time, for the purpose of meeting any Requirements of Law of any jurisdiction
in which any part of the Trust may at the time be located, the Trustee shall
have the power and may execute and deliver all instruments to appoint one or
more persons to act as a co-trustee or co-trustees, or separate trustee or
separate trustees, of all or any part of the Trust, and to vest in such Person
or Persons, in such capacity and for the benefit of the Certificateholders, such
title to the Trust, or any part thereof, and, subject to the other provisions of
this Section, such powers, duties, obligations, rights and trusts as the Trustee
may consider necessary or desirable. No co-trustee or separate trustee hereunder
shall be required to meet the terms of eligibility as a successor trustee under
Section 11.06 and no notice to Certificateholders of the appointment of any
co-trustee or separate trustee shall be required under Section 11.08.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
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(i) all rights, powers, duties and obligations conferred or
imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee
or co-trustee is not authorized to act separately without the
Trustee joining in such act) except to the extent that under any law
of any jurisdiction in which any particular act or acts are to be
performed (whether as Trustee hereunder or as Successor Servicer)
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 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. Each separate trustee and co-trustee, upon its
acceptance of the trusts conferred, shall be vested with the estates or property
specified in its instrument of appointment, either jointly with the Trustee or
separately, as may be provided therein, subject to all the provisions of this
Agreement, specifically including every provision of this Agreement relating to
the conduct of, affecting the liability of, or affording protection to, the
Trustee. Every such instrument shall be filed with the Trustee and a copy
thereof given to the Transferors and the Servicer.
(d) Any separate trustee or co-trustee may at any time
constitute the Trustee, its agent or attorney-in-fact with full power and
authority, to the extent not prohibited by law, to do any lawful act under or in
respect of this Agreement on its behalf and in its name. If any separate trustee
or co-trustee shall die, become incapable of acting, resign or be removed, all
its estates, properties, rights, remedies and trusts shall vest in and be
exercised by the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 11.11 Tax Returns. In the event the Trust shall be
required to file tax returns, the Servicer shall prepare or shall cause to be
prepared such tax returns and shall provide such tax returns to the Trustee for
signature at least five days before such tax returns are due to be filed. The
Servicer, in accordance with the terms of each Supplement, shall also prepare or
shall cause to be prepared all tax information required by law to be distributed
to Investor Certificateholders 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
Investor Certificateholders. The Trustee, upon request, will furnish the
Servicer with all such information known to the Trustee as may be reasonably
required in connection with the preparation of all tax returns of the Trust, and
shall, upon request, execute such returns. The Servicer shall provide the
Transferors with copies of all such tax returns.
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Section 11.12 Trustee May Enforce Claims Without Possession of
Certificates. All rights of action and claims under this Agreement or the
Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee. Any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of the Certificateholders in respect of which such judgment has
been obtained.
Section 11.13 Suits for Enforcement.
(a) If a Servicer Default shall occur and be continuing, the
Trustee, in its discretion may, subject to the provisions of Sections 11.01 and
11.14, proceed to protect and enforce its rights and the rights of the
Certificateholders under this Agreement by suit, action or proceeding in equity
or at law or otherwise, whether for the specific performance of any covenant or
agreement contained in this Agreement or in aid of the execution of any power
granted in this Agreement or for the enforcement of any other legal, equitable
or other remedy as the Trustee, being advised by counsel, shall deem most
effectual to protect and enforce any of the rights of the Trustee or the
Certificateholders.
(b) Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any
Certificateholder any plan of reorganization, arrangement, adjustment or
composition affecting the Investor Certificates or the rights of any Holder
thereof, or to authorize the Trustee to vote in respect of the claim of any
Certificateholder in any such proceeding.
Section 11.14 Rights of Certificateholders to Direct Trustee.
Except as otherwise provided in the applicable Supplement, holders of Investor
Certificates evidencing more than 50% of the aggregate unpaid principal amount
of all Investor Certificates (or, with respect to any remedy, trust or power
that does not relate to all Series, 50% of the aggregate unpaid principal amount
of the Investor Certificates of all Series to which such remedy, trust or power
relates) shall have the right to direct the time, method, and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee; provided, however, that, subject to
Section 11.01, the Trustee shall have the right to decline to follow any such
direction if the Trustee after being advised by counsel determines that the
action so directed may not lawfully be taken, or a Responsible Officer or
Responsible Officers of the Trustee in good faith shall determine that the
proceedings so directed would be illegal or involve it in personal liability or
be unduly prejudicial to the rights of Investor 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 the Investor
Certificateholders.
Section 11.15 Representations and Warranties of Trustee. The
Trustee represents and warrants that:
(i) the Trustee is a banking corporation organized, existing
and in good standing under the laws of the State of New York;
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(ii) the Trustee has full power, authority and right to
execute, deliver and perform this Agreement and each Supplement, and
has taken all necessary action to authorize the execution, delivery
and performance by it of this Agreement and each Supplement;
(iii) this Agreement and each Supplement has been duly
executed and delivered by the Trustee;
(iv) the Trustee satisfies the eligibility requirements
prescribed by Section 11.06; and
(v) the Trustee will not use any office, place of business,
agents or employees of the Trustee in the State of Florida to act
for, or on behalf of, the Trust or the Trustee (in its capacity as
Trustee of the Trust), except to the extent that the Trustee first
provides an opinion (at the sole expense of the Transferor) of
counsel satisfactory to the Transferors and the Servicer stating
that any such activities proposed to be carried on in Florida will
not cause the Trust to be subject to any Florida income, franchise
or property (including intangibles) tax.
Section 11.16 Maintenance of Office or Agency. The Trustee
will maintain at its expense an office or agency (the "Corporate Trust Office")
where notices and demands to or upon the Trustee in respect of the Certificates
and this Agreement may be served in the State of New York. The Trustee maintains
its Corporate Trust Office at 000 Xxxxxxx Xxxxxx, Xxxxx 8 West, New York, New
York 10286, as such office and will give prompt notice to the Servicer and to
Investor Certificateholders of any change in the location of the Certificate
Register or any such office or agency.
[END OF ARTICLE XI]
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ARTICLE XII
TERMINATION
Section 12.01 Termination of Trust. The Trust and the
respective obligations and responsibilities of the Transferors, the Servicer and
the Trustee created hereby (other than the obligation of the Trustee to make
payments to Investor Certificateholders as hereinafter set forth) shall
terminate, except with respect to the duties described in Section 8.04 and
subsection 12.02(b), upon the earlier of (i) May 1, 2030, (ii) at the option of
the Transferors, the day following the Distribution Date on which the Invested
Amount for each Series is zero and (iii) the time provided in Section 9.01.
Section 12.02 Final Distribution.
(a) The Servicer shall give the Transferors and the Trustee at
least 30 days' prior notice of the Distribution Date on which the Investor
Certificateholders of any Series or Class may surrender their Investor
Certificates for payment of the final distribution on and cancellation of such
Investor Certificates (or, in the event of a final distribution resulting from
the application of Section 2.06, 9.01 or 10.01, notice of such Distribution Date
promptly after the Servicer has determined that a final distribution will occur,
if such determination is made less than 30 days prior to such Distribution
Date). Such notice shall be accompanied by an Officer's Certificate of the
Servicer setting forth the information specified in Section 3.05 covering the
period during the then-current calendar year through the date of such notice.
Not later than the fifth day of the month in which the final distribution in
respect of such Series or Class is payable to Investor Certificateholders, the
Trustee shall provide notice to Investor Certificateholders of such Series or
Class specifying (i) the date upon which final payment of such Series or Class
will be made upon presentation and surrender of Investor Certificates of such
Series or Class at the office or offices therein designated, (ii) the amount of
any such final payment and (iii) that the Record Date otherwise applicable to
such payment date is not applicable, payments being made only upon presentation
and surrender of such Investor Certificates at the office or offices therein
specified (which, in the case of Bearer Certificates, shall be outside the
United States). The Trustee shall give such notice to the Transfer Agent and
Registrar and the Paying Agent at the time such notice is given to Investor
Certificateholders.
(b) Notwithstanding a final distribution to the Investor
Certificateholders of any Series or Class (or the termination of the Trust),
except as otherwise provided in this paragraph, all funds then on deposit in the
Collection Account and any Series Account allocated to such Investor
Certificateholders shall continue to be held in trust for the benefit of such
Investor Certificateholders and the Paying Agent or the Trustee shall pay such
funds to such Investor Certificateholders upon surrender of their Investor
Certificates, if certificated (and any excess shall be paid in accordance with
the terms of any Enhancement Agreement). In the event that all such Investor
Certificateholders shall not surrender their Investor Certificates for
cancellation within six months after the date specified in the notice from the
Trustee described in paragraph (a), the Trustee shall give a second notice to
the remaining such Investor Certificateholders to surrender their Investor
Certificates for cancellation and receive the final distribution with respect
thereto (which surrender and payment, in the case of Bearer Certificates, shall
be outside the United States). If within one year after the second notice all
such Investor Certificates shall not have been surrendered for cancellation, the
Trustee may take appropriate steps, or may appoint an agent to take appropriate
steps, to contact the remaining such Investor Certificateholders concerning
surrender of their Investor Certificates, and the cost thereof shall be paid out
of the funds in the Collection Account or any Series Account held for the
benefit of such Investor Certificateholders. The Trustee and the Paying Agent
shall pay to the Transferors any monies held by them for the payment of
principal or interest that remains unclaimed for two years. After payment to the
Transferor, Investor Certificateholders entitled to the money must look to the
Transferors for payment as general creditors unless an applicable abandoned
property law designates another Person.
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(c) In the event that the Invested Amount with respect to any
Series is greater than zero on its Series Termination Date (after giving effect
to deposits and distributions otherwise to be made on such Series Termination
Date) the Trustee will sell or cause to be sold on such Series Termination Date
an amount of Principal Receivables (or interests therein) equal to 100% of the
Invested Amount with respect to such Series on such Series Termination Date plus
related Finance Charge Receivables (after giving effect to such deposits and
distributions); provided, however, that in no event shall such amount exceed the
Series Allocation Percentage of Receivables with respect to such Series on such
Series Termination Date. The proceeds (the "Termination Proceeds") from such
sale shall be immediately deposited into the Collection Account for such Series.
The Termination Proceeds shall be allocated and distributed to Investor
Certificateholders of such Series in accordance with the terms of the applicable
Supplement.
Section 12.03 Transferor's Termination Rights. Upon the
termination of the Trust pursuant to Section 12.01 and the surrender of the
Transferor's Certificates, the Trustee shall sell, assign and convey to the
Holders of the Transferor Certificates or any of their designees, 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 and all amounts received with respect thereto (including all
moneys then held in the Collection Account or any Series Account) and all
proceeds thereof, except for amounts held by the Trustee pursuant to subsection
12.02(b). The Trustee shall execute and deliver such instruments of transfer and
assignment, in each case without recourse, as shall be reasonably requested by
the Transferors to vest in the Holders of the Transferor Certificates or any of
their designees all right, title and interest which the Trust had in the
Receivables.
Section 12.04 Defeasance. Notwithstanding anything to the
contrary in this Agreement or any Supplement:
(a) The Transferors may at their option be discharged from
their obligations hereunder with respect to any Series or all outstanding Series
(each, a "Defeased Series") on the date the applicable conditions set forth in
subsection 12.04(c) are satisfied (a "Defeasance") but only if Defeasance is
explicitly available to such Series in accordance with its related Supplement
(it being understood that Defeasance shall not be available to such Series in
any other case); provided, however, that the following rights, obligations,
powers, duties and immunities shall survive with respect to each Defeased Series
until otherwise terminated or discharged hereunder: (i) the rights of the
Holders of Investor Certificates of the Defeased Series to receive, solely from
the trust fund provided for in subsection 12.04(c), payments in respect of
principal of and interest on such Investor Certificates when such payments are
due; (ii) the Transferors' obligations with respect to such Certificates under
Sections 6.04 and 6.05; (iii) the rights, powers, trusts, duties, and immunities
of the Trustee, the Paying Agent and the Registrar hereunder; and (iv) this
Section 12.04.
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(b) Subject to subsection 12.04(c), the Transferors at their
option may cause Collections allocated to each Defeased Series and available to
acquire additional Receivables to be applied to purchase Eligible Investments
rather than acquire additional Receivables.
(c) The following shall be the conditions precedent to any
Defeasance under subsection 12.04(a):
(i) the Transferors irrevocably shall have deposited or caused
to be deposited with the Trustee (such deposit to be made from other
than the Transferors' or any Affiliate of the Transferors' funds),
under the terms of an irrevocable trust agreement in form and
substance satisfactory to the Trustee, as trust funds in trust for
making the payments described below, (A) Dollars in an amount equal
to, or (B) Eligible Investments which through the scheduled payment
of principal and interest in respect thereof will provide, not later
than the due date of payment thereon, money in an amount equal to,
or (C) a combination thereof, in each case sufficient to pay and
discharge (without relying on income or gain from reinvestment of
such amount), and which shall be applied by the Trustee to pay and
discharge, all remaining scheduled interest and principal payments
on all outstanding Investor Certificates of each Defeased Series on
the dates scheduled for such payments in this Agreement and the
applicable Supplements and all amounts owing to the Series Enhancers
with respect to each Defeased Series;
(ii) a statement from a firm of nationally recognized
independent public accountants (who may also render other services
to the Transferors) to the effect that such deposit is sufficient to
pay the amounts specified in clause (i) above;
(iii) prior to its first exercise of its right pursuant to
this Section 12.04 with respect to a Defeased Series to substitute
money or Eligible Investments for Receivables, the Transferors shall
have delivered to the Trustee an Opinion of Counsel to the effect
contemplated by clause (b) of the definition in Section 1.01 of the
term "Tax Opinion" (the preparation and delivery of which shall not
be at the expense of the Trustee) with respect to such deposit and
termination of obligations, and an Opinion of Counsel to the effect
that (A) such deposit and termination of obligations will not result
in the Trust being required to register as an "investment company"
within the meaning of the Investment Company Act and (B) if the
Transferors' long-term unsecured debt obligations are not rated at
least P-3 or Baa3, respectively, by Moody's, such deposit and
termination of obligations would not be a fraudulent conveyance
(based in reliance on certain certificates to the effect that the
Receivables and termination of obligations constitute fair value for
consideration paid therefor and as to the solvency of the
Transferors);
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(iv) the Transferors shall have delivered to the Trustee an
Officer's Certificate of the Transferors stating the Transferors
reasonably believe that such deposit and termination of obligations
will not, based on the facts known to such officer at the time of
such certification, then cause a Pay-Out Event with respect to any
Series or any event that, with the giving of notice or the lapse of
time, would result in the occurrence of a Pay-Out Event with respect
to any Series; and
(v) the Rating Agency Condition shall have been satisfied and
the Transferors shall have delivered copies of such written notice
to the Servicer and the Trustee.
[END OF ARTICLE XII]
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ARTICLE XIII
MISCELLANEOUS PROVISIONS
Section 13.01 Amendment; Waiver of Past Defaults.
(a) This Agreement may be amended by the parties hereto from
time to time prior to, or in connection with, the issuance of the first Series
of Investor Certificates hereunder without the requirement of any consents or
the satisfaction of any conditions set forth below. This Agreement or any
Supplement may be amended from time to time (including, without limitation, in
connection with the issuance of a Supplemental Certificate, conveyance of a
Participation Interest, allocation of assets pursuant to Section 4.06, the
designation of an Additional Transferor, or to change the definition of Monthly
Period, Determination Date or Distribution Date) by the Servicer, the
Transferors and the Trustee, by a written instrument signed by each of them,
without the consent of any of the Certificateholders; provided that (i) the
Transferors shall have delivered to the Trustee Officer's Certificates of the
Transferors, dated the date of any such amendment, stating that the Transferors
reasonably believe that such amendment will not have an Adverse Effect and (ii)
the Rating Agency Condition shall have been satisfied with respect to any such
amendment; provided further that such action shall not effect a change in the
Permitted Activities of the Trust except for those changes necessary for
compliance with accounting requirements or tax requirements or required to cure
any ambiguity or correct or supplement any provision contained in this Agreement
or any Supplement which may be defective or inconsistent with any provisions
thereof.
(b) This Agreement or any Supplement may also be amended from
time to time (including in connection with the issuance of a Supplemental
Certificate) by the Servicer, the Transferors and the Trustee (A) in the case of
a change in the Permitted Activities of the Trust which is not materially
adverse to Holders of Investor Certificates, with the consent of Holders of
Investor Certificates evidencing not less than 50% of the aggregated unpaid
principal amount of the Investor Certificates of each outstanding Series
affected by such change, unless such change is necessary for compliance with
accounting requirements or tax requirements or required to cure any ambiguity or
correct or supplement any provision contained in this Agreement or any
Supplement which may be defective or inconsistent with any provisions thereof
and (B) in all other cases, with the consent of the Holders of Investor
Certificates evidencing not less than 66-2/3% of the aggregate unpaid principal
amount of the Investor Certificates of all affected Series for which the
Transferors have not delivered Officer's Certificates stating that there is no
Adverse Effect, for the purpose of adding any provisions to or changing in any
manner or eliminating any of the provisions of this Agreement or any Supplement
or of modifying in any manner the rights of the Certificateholders; provided,
however, that no such amendment shall (i) reduce in any manner the amount of or
delay the timing of any distributions to (changes in Pay-Out Events or
Reinvestment Events that decrease the likelihood of the occurrence thereof shall
not be considered delays in the timing of distributions for purposes of this
clause) be made to Investor Certificateholders or deposits of amounts to be so
distributed or the amount available under any Series Enhancement without the
consent of each affected Certificateholder, (ii) change the definition of or the
manner of calculating the interest of any Investor Certificateholder without the
consent of each affected Investor Certificateholder, (iii) reduce the aforesaid
percentage required to consent to any such amendment without the consent of each
Investor Certificateholder or (iv) adversely affect the rating of any Series or
Class by each Rating Agency without the consent of the Holders of Investor
Certificates of such Series or Class evidencing not less than 66-2/3% of the
aggregate unpaid principal amount of the Investor Certificates of such Series or
Class (which shall not be deemed to occur if the Rating Agency Condition shall
have been satisfied with respect to such amendment).
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(c) Promptly after the execution of any such amendment or
consent (other than an amendment pursuant to subsection 13.01(a)), the Trustee
shall furnish notification of the substance of such amendment to each Investor
Certificateholder, and the Servicer shall furnish notification of the substance
of such amendment to each Rating Agency and each Series Enhancer.
(d) It shall not be necessary for the consent of Investor
Certificateholders under this Section to approve the particular form of any
proposed amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Investor Certificateholders shall be
subject to such reasonable requirements as the Trustee may prescribe.
(e) Notwithstanding anything in this Section (other than
subsection (i) below) to the contrary, no amendment may be made to this
Agreement or any Supplement which would adversely affect in any material respect
the interests of any Series Enhancer without the consent of such Series
Enhancer.
(f) Any Supplement executed in accordance with the provisions
of Section 6.03 shall not be considered an amendment to this Agreement for the
purposes of this Section.
(g) The Holders of Investor Certificates evidencing more than
66-2/3% of the aggregate unpaid principal amount of the Investor Certificates of
each Series or, with respect to any Series with two or more Classes, of each
Class (or, with respect to any default that does not relate to or affect all
Series, 66-2/3% of the aggregate unpaid principal amount of the Investor
Certificates of each Series to which such default relates or, with respect to
any such Series with two or more Classes, of each Class) may, on behalf of all
Certificateholders, waive any default by the Transferors or the Servicer in the
performance of their obligations hereunder and its consequences, except the
failure to make any distributions required to be made to Investor
Certificateholders or to make any required deposits of any amounts to be so
distributed. Upon any such waiver of a past default, such default shall cease to
exist, and any default arising therefrom shall be deemed to have been remedied
for every purpose of this Agreement. No such waiver shall extend to any
subsequent or other default or impair any right consequent thereon except to the
extent expressly so waived.
(h) 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. In connection with the execution of any
amendment hereunder, the Trustee shall be entitled to receive the Opinion of
Counsel described in subsection 13.02(d).
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(i) Additionally, this Agreement and any Supplement executed
in accordance with the provisions of subsection 6.03 will be amended by the
Servicer and the Trustee at the direction of the Transferors without the consent
of any of the Certificateholders or Series Enhancers (i) to add, modify or
eliminate such provisions as may be necessary or advisable in order to enable
all or a portion of the Trust to qualify as, and to permit an election to be
made to cause all or a portion of the Trust to be treated as, a "financial asset
securitization investment trust" as described in the provisions of the "Seven
Year Balanced Budget Act of 1995," H.R. 2491, 104th Cong., 1st Sess. (1995), or
to enable all or a portion of the Trust to qualify and an election to be made
for similar treatment under such comparable subsequent federal income tax
provisions as may ultimately be enacted into law, and (ii) in connection with
any such election, to modify or eliminate existing provisions of the Pooling and
Servicing Agreement and any Supplement relating to the intended federal income
tax treatment of the Certificates and the Trust in the absence of the election.
Any amendment under this subsection is subject to the requirements that (i) the
Transferors deliver to the Trustee an Officer's Certificate of the Transferors
to the effect that the proposed amendments meet the requirements set forth in
this subsection and (ii) each Rating Agency will have notified the Transferors,
the Servicer and the Trustee in writing that the amendment will not result in a
reduction or withdrawal of the rating of any outstanding Series or Class to
which it is a Rating Agency. The amendments which the Transferors may make
without the consent of Certificateholders or Series Enhancers in connection with
any election described in this subsection may include, without limitation, the
elimination of any sale of Receivables and subsequent termination of the Trust
upon the occurrence of an Insolvency Event pursuant to Section 9.01 hereof.
(j) Additionally, this Agreement and any Supplement will be
amended by the Transferors without the consent of the Servicer, the Trustee or
any Investor Certificateholder to account for the transfer of assets as sales in
accordance with FASB Statement No. 140 or any successor FASB statement; provided
that the Transferors deliver a Tax Opinion on the date of such amendment.
Promptly after the effectiveness of any amendment pursuant to this subsection,
the Transferors shall deliver a copy of such amendment to each of the Servicer,
the Trustee and each Rating Agency.
(k) In the event that any Receivables Purchase Agreement
provides for any vote or consent by any Investor Certificateholders in
connection with an amendment of such Receivables Purchase Agreement, such
Investor Certificateholders shall be given the opportunity to vote on or consent
to such amendment, in accordance with the terms and conditions specified
therein. In the event that any Receivables Purchase Agreement specifies any
action to be taken by the Transferors, the Trustee or the Servicer, in
connection with any amendment of such Receivables Purchase Agreement, the
Transferors, the Trustee and the Servicer hereby agree to take such action in
accordance with the terms and conditions therein.
(l) Any supplemental agreement executed in accordance with the
provisions of Section 7.02 or any Assumption Agreement executed in accordance
with the provisions of Section 7.05 shall not be considered an amendment to this
Agreement for the purposes of this Section 13.01.
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Section 13.02 Protection of Right, Title and Interest to
Trust.
(a) The Servicer shall cause this Agreement, all amendments
and supplements hereto and all financing statements and amendments to financing
statements and any other necessary documents covering the Certificateholders'
and the Trustee's right, title and interest to the Trust to be promptly
recorded, registered and filed, and at all times to be kept recorded, registered
and filed, all in such manner and in such places as may be required by law fully
to preserve and protect the right, title and interest of the Certificateholders
and the Trustee hereunder to all property comprising the Trust. 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 Transferors shall
cooperate fully with the Servicer in connection with the obligations set forth
above and will execute any and all documents reasonably required to fulfill the
intent of this paragraph.
(b) Within 30 days after any Transferor makes any change in
its name or its type or jurisdiction of organization, such Transferor 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 or ownership interest in the Receivables and the proceeds
thereof.
(c) Each Transferor and the Servicer shall give the Trustee
prompt notice of any relocation of any office from which it services Receivables
or keeps records concerning the Receivables or of its principal executive office
and whether, as a result of such relocation, the applicable provisions of the
UCC would require the filing of any amendment of any previously filed financing
or amendments to financing statement or of any new financing statement and shall
file such financing statements or amendments as may be necessary to perfect or
to continue the perfection of the Trust's security interest in the Receivables
and the proceeds thereof. Each Transferor and the Servicer shall at all times
maintain each office from which it services Receivables and its principal
executive offices within the United States. The Trustee shall give each
Transferor and the Servicer prompt notice of any change in the name of the
Trustee or any change in the Trustee's address as shown on any financing
statement filed in connection with the transactions contemplated by this
Agreement or any Supplement if the address so shown ceases to be an address from
which information concerning the Trustee's (on behalf of the Trust) security
interest or ownership interest in the Receivables and the proceeds thereof can
be obtained. The Transferors shall file such financing statements or amendments
as may be necessary to continue the perfection of the Trust's security interest
or ownership interest in the Receivables and the proceeds thereof.
(d) The Servicer shall deliver to the Trustee (i) upon the
execution and delivery of each amendment of this Agreement pursuant to Section
13.01 or any Supplement, an Opinion of Counsel to the effect specified in
Exhibit E-1; (ii) on each date specified in subsection 2.09(c)(ix) with respect
to Aggregate Additions to be designated as Accounts, an Opinion of Counsel
substantially in the form of Exhibit E-2, (iii) semiannually, with respect to
any New Accounts included as Accounts, an Opinion of Counsel substantially in
the form of Exhibit E-2, (iv) on each Addition Date on which any Participation
Interests are to be included in the Trust pursuant to subsection 2.09(a) or (b),
an Opinion of Counsel covering the same substantive legal issues addressed by
Exhibits E-1 and E-2 but conformed to the extent appropriate to relate to
Participation Interests; (v) on or before March 31 of each year, beginning with
March 31, 2005, an Opinion of Counsel substantially in the form of Exhibit E-3;
and (vi) in connection with the occurrence of any event contemplated by Section
7.02 or Section 7.05, the Opinions of Counsel and the Tax Opinion specified
therein.
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Section 13.03 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 Investor Certificateholder shall have any right to vote
(except as expressly provided in this Agreement) or in any manner otherwise
control the operation and management of the Trust, or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Certificates, be construed so as to constitute the Investor
Certificateholders from time to time as partners or members of an association,
nor shall any Investor Certificateholder be under any liability to any third
person by reason of any action taken by the parties to this Agreement pursuant
to any provision hereof.
(c) No Investor Certificateholder shall have any right by
virtue of any provisions of this Agreement to institute any suit, action or
proceeding in equity or at law upon or under or with respect to this Agreement,
unless such Investor Certificateholder previously shall have made, and unless
the Holders of Investor Certificates evidencing more than 50% of the aggregate
unpaid principal amount of all Investor Certificates (or, with respect to any
such action, suit or proceeding that does not relate to all Series, 50% of the
aggregate unpaid principal amount of the Investor Certificates of all Series to
which such action, suit or proceeding relates) shall have made, a request to the
Trustee to institute such action, suit or proceeding in its own name as Trustee
hereunder and shall have offered to the Trustee such reasonable indemnity as it
may require against the costs, expenses and liabilities to be incurred therein
or thereby, and the Trustee, for 60 days after such request and offer of
indemnity, shall have neglected or refused to institute any such action, suit or
proceeding; it being understood and intended, and being expressly covenanted by
each Investor Certificateholder with every other Investor Certificateholder and
the Trustee, that no one or more Investor Certificateholders shall have any
right in any manner whatever by virtue or by availing itself or themselves of
any provisions of this Agreement to affect, disturb or prejudice the rights of
the holders of any other of the Investor Certificates, or to obtain or seek to
obtain priority over or preference to any other such Investor Certificateholder,
or to enforce any right under this Agreement, except in the manner herein
provided and for the equal, ratable and common benefit of all Investor
Certificateholders except as otherwise expressly provided in this Agreement. For
the protection and enforcement of the provisions of this Section, each and every
Investor Certificateholder and the Trustee shall be entitled to such relief as
can be given either at law or in equity.
Section 13.04 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 OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES
HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
106
Section 13.05 Notices; Payments.
(a) All demands, notices, instructions, directions and
communications (collectively, "Notices") under this Agreement shall be in
writing and shall be deemed to have been duly given if personally delivered at,
mailed by certified mail, return receipt requested, or sent by facsimile
transmission (i) in the case of RFC II, to American Express Receivables
Financing Corporation II, at American Express Tower, 3 World Financial Center,
Room 138, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000-0000, Attention: Secretary
(facsimile no. (000) 000-0000, (ii) in the case of Centurion Bank, to American
Express Centurion Bank, at 0000 Xxxxx 0000 Xxxx, Xxxx Xxxx Xxxx, Xxxx 00000,
Attention: President (facsimile no (000) 000-0000, (iii) in the case of RFC III,
to American Express Receivables Financing Corporation III LLC, at 0000 Xxxxx
0000 Xxxx, Xxxx 0000, 02-01-50, Xxxx Xxxx Xxxx, Xxxx 00000, Attention: President
(facsimile no. (000) 000-0000), with a copy to American Express Travel Related
Services Company, Inc., as administrator, American Express Tower, World
Financial Center, 000 Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: General
Counsel (facsimile no. 212-619-7099), (iv) in the case of TRS, to American
Express Travel Related Services Company, Inc., American Express Tower, 3 World
Financial Center, 000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention: Treasurer
(facsimile no. (000) 000-0000, (v) in the case of FSB, at American Express Bank,
FSB, 0000 Xxxxx 0000 Xxxx, Xxxx Xxxx Xxxx, Xxxx 00000, Attention: President
(facsimile no. (000) 000-0000), (vi) in the case of RFC IV, to American Express
Receivables Financing Corporation IV LLC, at 0000 Xxxxx 0000 Xxxx, Xxxx 0000,
02-01-56, Xxxx Xxxx Xxxx, Xxxx 00000, Attention: President (facsimile no. (801)
945-4060), with a copy to American Express Travel Related Services Company,
Inc., as administrator, American Express Tower, World Financial Center, 000
Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: General Counsel (facsimile
no. 212-619-7099), (vii) in the case of the Trustee, the Paying Agent or
Transfer Agent and Registrar, to The Bank of New York, 000 Xxxxxxx Xxxxxx, Xxxxx
0 Xxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: Asset-Backed Unit (facsimile no.
(000) 000-0000), (viii) in the case of Moody's, to Xxxxx'x Investors Service
Inc. at 00 Xxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Attention: ABS Xxxxxxxxxx
Xxxxxxxxxx, 0xx Xxxxx (facsimile no. (000) 000-0000), (ix) in the case of
Standard & Poor's, to Standard & Poor's Ratings Group at 00 Xxxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000, Attention: Asset Backed Group (facsimile no. (212)
412-0323), and (x) to any other Person as specified in any Supplement; or, as to
each party, at such other address or facsimile number as shall be designated by
such party in a written notice to each other party.
(b) Any Notice required or permitted to be given to a Holder
of Registered Certificates shall be given by first-class mail, postage prepaid,
at the address of such Holder as shown in the Certificate Register. No Notice
shall be required to be mailed to a Holder of Bearer Certificates or Coupons but
shall be given as provided below. Any Notice so mailed within the time
prescribed in this Agreement shall be conclusively presumed to have been duly
given, whether or not the Investor Certificateholder receives such Notice. In
addition, (a) if and so long as any Series or Class is listed on the Luxembourg
Stock Exchange and such Exchange shall so require, any Notice to Investor
Certificateholders shall be published in an Authorized Newspaper of general
circulation in Luxembourg within the time period prescribed in this Agreement
and (b) in the case of any Series or Class with respect to which any Bearer
Certificates are outstanding, any Notice required or permitted to be given to
Investor Certificateholders of such Series or Class shall be published in an
Authorized Newspaper within the time period prescribed in this Agreement.
107
Section 13.06 Severability of Provisions. If any one or more
of the covenants, agreements, provisions or terms of this Agreement shall for
any reason whatsoever be held invalid, then such provisions shall be deemed
severable from the remaining provisions of this Agreement and shall in no way
affect the validity or enforceability of the remaining provisions or of the
Certificates or the rights of the Certificateholders.
Section 13.07 Certificates Nonassessable and Fully Paid. It is
the intention of the parties to this Agreement that the Certificateholders shall
not be personally liable for obligations of the Trust, that the interests in the
Trust represented by the Certificates shall be nonassessable for any losses or
expenses of the Trust or for any reason whatsoever and that the Certificates
upon authentication and delivery thereof by the Trustee pursuant to Section 6.02
are and shall be deemed fully paid.
Section 13.08 Further Assurances. The Transferors and the
Servicer agree to do and perform, from time to time, any and all acts and to
execute any and all further instruments required or reasonably requested by the
Trustee more fully to effect the purposes of this Agreement, including the
execution of any financing statements or amendments to financing statements
relating to the Receivables for filing under the provisions of the UCC of any
applicable jurisdiction.
Section 13.09 Nonpetition Covenant. Notwithstanding any prior
termination of this Agreement, the Investor Certificateholders, the Servicer,
the Trustee, the Transferors, the Paying Agent, the Authenticating Agent, the
Transfer Agent, the Registrar, the Series Enhancers and each Holder of a
Supplemental Certificate shall not, prior to the date which is one year and one
day after the termination of this Agreement with respect to the Trust or any
Transferor, acquiesce, petition or otherwise invoke or cause the Trust or the
Transferors to invoke the process of any Governmental Authority for the purpose
of commencing or sustaining a case against the Trust or any Transferor under any
Federal or state bankruptcy, insolvency or similar law or appointing a receiver,
liquidator, assignee, trustee, custodian, sequestrator or other similar official
of the Trust or any Transferor or any substantial part of its property or
ordering the winding-up or liquidation of the affairs of the Trust or any
Transferor.
Section 13.10 No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of the Trustee or the
Certificateholders, any right, remedy, power or privilege under this Agreement
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege under this Agreement preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges provided under this
Agreement are cumulative and not exhaustive of any rights, remedies, powers and
privileges provided by law.
Section 13.11 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.
Section 13.12 Third-Party Beneficiaries. This Agreement will
inure to the benefit of and be binding upon the parties hereto, the
Certificateholders, any Series Enhancer and their respective successors and
permitted assigns. Except as otherwise expressly provided in this Agreement
(including Section 7.04), no other Person will have any right or obligation
hereunder.
108
Section 13.13 Actions by Certificateholders.
(a) Wherever in this Agreement a provision is made that an
action may be taken or a Notice given by Certificateholders, such action or
Notice may be taken or given by any Certificateholder, unless such provision
requires a specific percentage of Certificateholders.
(b) Any Notice, request, authorization, direction, consent,
waiver or other act by the Holder of a Certificate shall bind such Holder and
every subsequent Holder of such Certificate and of any Certificate issued upon
the registration of transfer thereof or in exchange therefor or in lieu thereof
in respect of anything done or omitted to be done by the Trustee, the
Transferors or the Servicer in reliance thereon, whether or not notation of such
action is made upon such Certificate.
Section 13.14 Rule 144A Information. For so long as any of the
Investor Certificates of any Series or Class are "restricted securities" within
the meaning of Rule 144(a)(3) under the Act, each of the Transferors, the
Trustee, the Servicer and any Series Enhancer agree to cooperate with each other
to provide to any Investor Certificateholders of such Series or Class and to any
prospective purchaser of Certificates designated by such an Investor
Certificateholder, upon the request of such Investor Certificateholder or
prospective purchaser, any information required to be provided to such holder or
prospective purchaser to satisfy the condition set forth in Rule 144A(d)(4)
under the Act.
Section 13.15 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 13.16 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]
109
IN WITNESS WHEREOF, the Transferors, the Servicer and the
Trustee have caused this Pooling and Servicing Agreement to be duly executed by
their respective officers as of the day and year first above written.
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION II, as a Transferor
By: /s/ Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: President
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION III LLC, as a Transferor
By: /s/ L. Xxxxx Xxxxx
-------------------------------------------
Name: L. Xxxxx Xxxxx
Title: President
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION IV LLC, as a Transferor
By: /s/ Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: President
AMERICAN EXPRESS TRAVEL RELATED
SERVICES COMPANY, INC., as the Servicer
By: /s/ Xxxxx X. Xxxxx
-------------------------------------------
Name: Xxxxx X. Xxxxx
Title: Senior Vice President & Treasurer
000
XXX XXXX XX XXX XXXX, as Trustee
By: /s/ Xxxxxxxxx X. Xxxxxxxx
-------------------------------------------
Name: Xxxxxxxxx X. Xxxxxxxx
Title: Assistant Vice President
THE BANK OF NEW YORK,
as Securities Intermediary
By: /s/ Xxxxxxxxx X. Xxxxxxxx
-------------------------------------------
Name: Xxxxxxxxx X. Xxxxxxxx
Title: Assistant Vice President
Acknowledged and Accepted:
AMERICAN EXPRESS CENTURION BANK,
as a Transferor under the Original Pooling Agreement
By: /s/ L. Xxxxx Xxxxx
---------------------------------------
Name: L. Xxxxx Xxxxx
Title: President & Chief Operating Officer
AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION II,
as a Transferor under the Original Pooling Agreement
By: /s/ Xxxxx X. Xxxxx
----------------------------------------
Name: Xxxxx X. Xxxxx
Title: President
111
EXHIBIT A
FORM OF TRANSFEROR CERTIFICATE
THIS TRANSFEROR CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED. NEITHER THIS TRANSFEROR CERTIFICATE NOR ANY
PORTION HEREOF MAY BE OFFERED OR SOLD EXCEPT IN COMPLIANCE WITH THE REGISTRATION
PROVISIONS OF SUCH ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH
REGISTRATION PROVISIONS.
THIS TRANSFEROR CERTIFICATE IS NOT PERMITTED TO BE
TRANSFERRED, ASSIGNED, EXCHANGED OR OTHERWISE PLEDGED OR CONVEYED EXCEPT IN
COMPLIANCE WITH THE TERMS OF THE POOLING AND SERVICING AGREEMENT REFERRED TO
HEREIN.
No. R-_______________ One Unit
American Express Credit Account Master Trust
TRANSFEROR CERTIFICATE
THIS CERTIFICATE REPRESENTS AN INTEREST
IN CERTAIN ASSETS OF THE
AMERICAN EXPRESS CREDIT ACCOUNT MASTER TRUST
Evidencing an interest in a trust, the corpus of which consists primarily of an
interest in receivables generated from time to time in the ordinary course of
business in a portfolio of revolving credit card and other accounts transferred
by American Express Receivables Financing Corporation II, a Delaware corporation
("RFC II"), American Express Receivables Financing Corporation III LLC, a
Delaware limited liability company ("RFC III"), and American Express Receivables
Financing Corporation IV LLC, a Delaware limited liability company ("RFC IV"),
each as a transferor (together, the "Transferors").
(Not an interest in or obligation of the Transferors
or any affiliate thereof)
This certifies that RFC II, RFC III and RFC IV are the
registered owners of a fractional interest in the assets of a trust (the
"Trust") not allocated to the Certificateholders' Interest or the interest of
any Holder of a Supplemental Certificate pursuant to the Pooling and Servicing
Agreement, dated as of May 16, 1996, as amended and restated as of April 16,
2004 (as amended and supplemented, the "Agreement"), among the Transferors,
American Express Travel Related Services Company, Inc., as servicer (the
"Servicer"), and The Bank of New York, a New York banking corporation, as
trustee (the "Trustee"). The corpus of the Trust consists of (i) the
Transferors' fractional undivided interest in a portfolio of certain receivables
(the "Receivables") existing in the revolving credit card and other accounts
identified under the Agreement from time to time (the "Accounts"), (ii) certain
Receivables generated under the Accounts from time to time thereafter, (iii)
certain funds collected or to be collected from accountholders in respect of the
Receivables, (iv) all funds which are from time to time on deposit in the
Collection Account, Special Funding Account and in the Series Accounts, (v) the
benefits of any Series Enhancements issued and to be issued by Series Enhancers
with respect to one or more Series of Investor Certificates and (vi) all other
assets and interests constituting the Trust, including Recoveries and Issuer
Rate Fees allocated to the Trust pursuant to the Agreement and any Supplement.
Although a summary of certain provisions of the Agreement is set forth below,
this Certificate does not purport to summarize the Agreement and reference is
made to the Agreement for information with respect to the interests, rights,
benefits, obligations, proceeds and duties evidenced hereby and the rights,
duties and obligations of the Trustee. A copy of the Agreement may be requested
from the Trustee by writing to the Trustee at the Corporate Trust Office. To the
extent not defined herein, the capitalized terms used herein have the meanings
ascribed to them in the Agreement.
A-1
This Certificate is issued under and is subject to the terms,
provisions and conditions of the Agreement, to which Agreement, as amended and
supplemented from time to time, the Transferors by virtue of the acceptance
hereof assent and are bound.
The Receivables consist of Principal Receivables which arise
generally from the purchase of merchandise and services and amounts advanced to
cardholders as cash advances and Finance Charge Receivables which arise
generally from Periodic Finance Charges, Late Fees and other fees and charges
with respect to the Accounts.
This Certificate is the Transferor Certificate, which
represents the Transferors' interest in certain assets of the Trust, including
the right to receive a portion of the Collections and other amounts at the times
and in the amounts specified in the Agreement. The aggregate interest
represented by the Transferor Certificate at any time in the Receivables in the
Trust shall not exceed the Transferors' Interest at such time. In addition to
the Transferor Certificate, (i) Investor Certificates will be issued to
investors pursuant to the Agreement, which will represent the
Certificateholders' Interest, and (ii) Supplemental Certificates may be issued
pursuant to the Agreement, which will represent that portion of the Transferors'
Interest not allocated to the Transferors. This Transferor Certificate shall not
represent any interest in the Collection Account, the Special Funding Account or
the Series Accounts, except as expressly provided in the Agreement, or any
Series Enhancements.
Unless otherwise specified in a Supplement with respect to a
particular Series the Transferors have entered into the Agreement, and this
Certificate is issued, with the intention that, for federal, state and local
income and franchise tax purposes, (i) the Investor Certificates of each Series
which are characterized as indebtedness at the time of their issuance will
qualify as indebtedness of the Transferors secured by the Receivables and (ii)
the Trust shall not be treated as an association taxable as a corporation. The
Transferors, by entering into the Agreement and by the acceptance of this
Transferor Certificate, agree to treat the Investor Certificates for federal,
state and local income and franchise tax purposes as indebtedness of the
Transferors.
Subject to certain conditions and exceptions specified in the
Agreement, the obligations created by the Agreement and the Trust created
thereby shall terminate upon the earlier of (i) May 1, 2030, (ii) the day
following the Distribution Date on which the Invested Amount and Enhancement
Invested Amount for each Series is zero (provided the Transferors have delivered
a written notice to the Trustee electing to terminate the Trust) and (iii) the
time provided in Section 9.01 of the Agreement.
Unless the certificate of authentication hereon has been
executed by or on behalf of the Trustee, by manual signature, this Certificate
shall not be entitled to any benefit under the Agreement or be valid for any
purpose.
A-2
IN WITNESS WHEREOF, the Transferors have caused this
Certificate to be duly executed.
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION II,
as a Transferor
By:
----------------------------------
Name:
Title:
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION III LLC,
as a Transferor
By:
----------------------------------
Name:
Title:
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION IV LLC,
as a Transferor
By:
----------------------------------
Name:
Title:
Dated: [ , ]
------- ---- -----
A-3
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is the American Express Credit Account Master Trust
Transferor Certificate described in the within-mentioned Agreement.
_____________________________________________________,
as Trustee
By ___________________________________________________
Authorized Signatory
or
By [________________________________________________],
as Authenticating Agent
for the Trustee
By _________________________________________________,
Authorized Signatory
A-4
EXHIBIT B
FORM OF ASSIGNMENT OF RECEIVABLES IN ADDITIONAL ACCOUNTS
(As required by Section 2.09 of
the Pooling and Servicing Agreement)
ASSIGNMENT No. [____] OF RECEIVABLES IN ADDITIONAL ACCOUNTS,
dated as of [________], [_________] (1)/, by and among AMERICAN EXPRESS
RECEIVABLES FINANCING CORPORATION II, a Delaware corporation, AMERICAN EXPRESS
RECEIVABLES FINANCING CORPORATION III LLC, a Delaware limited liability company,
and AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION IV LLC, a Delaware
limited liability company, as transferors (together, the "Transferors"), and THE
BANK OF NEW YORK, 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.
WITNESSETH
WHEREAS, the Transferors, the Trustee and American Express
Travel Related Services Company, Inc., as the Servicer (the "Servicer"), are
parties to the Pooling and Servicing Agreement, dated as of May 16, 1996, as
amended and restated as of April 16, 2004 (as may be amended and supplemented
from time to time, the "Agreement");
WHEREAS, pursuant to the Agreement, the Transferors wish to
designate Additional Accounts to be included as Accounts and to convey the
Receivables of such Additional Accounts, whether now existing or hereafter
created, to the Trustee as part of the corpus of the Trust (as each such term is
defined in the Agreement); and
WHEREAS, the Trustee is willing to accept such designation and
conveyance subject to the terms and conditions hereof.
NOW, THEREFORE, the Transferors and the Trustee hereby agree
as follows:
1. Defined Terms. All capitalized terms used herein shall have
the meanings ascribed to them in the Agreement unless otherwise defined herein.
"Additional Accounts" has the meaning set forth in Section 2.
"Addition Date" shall mean, with respect to the Additional
Accounts designated hereby, [__________], [____________].
"Addition Cut-Off Date" shall mean, with respect to the
Additional Accounts designated hereby, [__________], [____________].
"Addition Selection Date" shall mean [(i)] for the added
accounts with the code designation "[__]," the close of business on the cycle
billing date for such added accounts occurring in the period beginning on the
close of business on [_______], [_____], and ending at the close of business on
[_______], [_____] [and (ii) for the added accounts with the code designation
"[__]," the close of business on the cycle billing date for such added accounts
occurring in the period beginning on the close of business on [_______], [_____]
and ending at the close of business on [_______], [_____]].
--------
(1) / To be dated as of the applicable Addition Date.
B-1
2. Designation of Additional Accounts. On or before the date
hereof, the Transferors will deliver to the Trustee computer files, microfiche
lists or printed lists containing a true and complete schedule identifying all
Additional Accounts designated hereby by code designations "[__]" [and "[__]"]
(the "Additional Accounts") and specifying for each Additional Account its
account number and the aggregate amount of Receivables outstanding in such
Additional Account on the Addition Cut-Off Date, which computer files or lists
shall be marked as Schedule 1 hereto, shall be incorporated herein and made a
part hereof, and shall supplement Schedule 1 to the Agreement.
3. Conveyance of Receivables. (a) The Transferors do hereby
transfer, assign, set over and otherwise convey, without recourse except as set
forth in the Agreement, to the Trustee, on behalf of the Trust, for the benefit
of the Certificateholders, all their respective right, title and interest,
whether now owned or hereafter acquired, in, to and under the Receivables
existing in each of the Additional Accounts (including Related Accounts and
Transferred Accounts with respect to such Additional Accounts) at the close of
business on the Addition Cut-Off Date and thereafter created from time to time
until the termination of the Trust, all monies due or to become due and all
amounts received with respect thereto and all Collections (including allocable
Recoveries and Issuer Rate Fees) and proceeds (including Insurance Proceeds and
"proceeds" as defined in the UCC) thereof. The foregoing does not constitute and
is not intended to result in the creation or assumption by the Trust, the
Trustee, any Investor Certificateholder or any Series Enhancer of any obligation
of the Servicer, the Transferors or any other Person in connection with the
Accounts, the Receivables or under any agreement or instrument relating thereto.
(b) The Transferors agree to record and file, at their own
expense, financing statements (and amendments to such financing statements when
applicable) with respect to the Receivables existing as of the Addition Cut-Off
Date and thereafter created in Additional Accounts, meeting the requirements of
applicable state law in such manner and in such jurisdictions as are necessary
to perfect, and maintain perfection of, the transfer, assignment, set-over or
other conveyance of their interest in such Receivables to the Trust, and to
deliver a file-stamped copy of each such financing statement or amendment or
other evidence of such filing to the Trustee on or prior to the Addition Date.
The Trustee shall be under no obligation whatsoever to file such financing
statements or amendments thereto or to make any other filing under the UCC in
connection with such transfer and assignment.
(c) The Transferors further agree, at their own expense,
on or prior to the date of this Assignment, to indicate in the appropriate
computer files that Receivables created in connection with the Additional
Accounts designated hereby have been conveyed to the Trustee pursuant to the
Agreement and this Assignment for the benefit of the Certificateholders by
including in the securitization field of such computer files the code "[__]"
[or "[__]," as applicable,] for each such Additional Account.
B-2
(d) The parties hereto intend that each transfer of
Receivables and other property pursuant to this Assignment constitute a sale,
and not a secured borrowing, for accounting purposes. Nevertheless, the
Transferors do hereby grant to the Trustee a security interest in all of their
respective right, title and interest, whether now owned or hereafter acquired,
in, to and under the Receivables existing in each of the Additional Accounts
(including Related Accounts and Transferred Accounts with respect to such
Additional Accounts) at the close of business on the Addition Cut-Off Date and
thereafter created from time to time until the termination of the Trust, all
monies due or to become due and all amounts received with respect thereto and
all Collections (including allocable Recoveries and Issuer Rate Fees) and
proceeds (including Insurance Proceeds and "proceeds" as defined in the UCC)
thereof. This Assignment constitutes a security agreement under the UCC.
4. Acceptance by Trustee. The Trustee hereby acknowledges its
acceptance on behalf of the Trust of all right, title and interest to the
property conveyed to the Trustee pursuant to Section 3 of this Assignment, and
declares that it shall maintain such right, title and interest, upon the trust
set forth in the Agreement for the benefit of all Certificateholders. The
Trustee further acknowledges that, prior to or simultaneously with the execution
and delivery of this Assignment, the Transferors delivered to the Trustee the
computer files or lists described in Section 2 of this Assignment.
5. Representations and Warranties of the Transferors. Each
Transferor hereby severally represents and warrants to the Trustee, on behalf of
the Trust, as of the date of this Assignment and as of the Addition Date that:
(a) Legal Valid and Binding Obligation. This Assignment
constitutes a legal, valid and binding obligation of such Transferor,
enforceable against such 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 except as such
enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity);
(b) Eligibility of Accounts. As of the Addition Selection
Date, each related Additional Account designated hereby is an Eligible Account
and each Receivable then existing in each related Additional Account designated
hereby is an Eligible Receivable;
(c) Insolvency. As of the Addition Cut-Off Date and the
Addition Date, no Insolvency Event with respect to such Transferor has occurred
and the transfer by such Transferor of Receivables arising in the Additional
Accounts to the Trust has not been made in contemplation of the occurrence
thereof;
(d) Pay-Out Event. Such Transferor reasonably believes
that (A) the addition of the Receivables arising in the related Additional
Accounts will not, based on the facts known to such Transferor, then or
thereafter cause a Pay-Out Event to occur with respect to any Series and (B) no
selection procedure was utilized by such Transferor which would result in the
selection of Additional Accounts (from among the Eligible Accounts available to
such Transferor) that would be materially adverse to the interests of the
Investor Certificateholders of any Series as of the Addition Date;
B-3
(e) Security Interest. This Assignment constitutes either
a valid transfer and assignment to the Trustee of all right, title and interest,
whether now owned or hereafter acquired, of such Transferor in the Receivables
existing in each of the related Additional Accounts at the close of business on
the Addition Cut-Off Date or thereafter created, all monies due or to become due
and all amounts received with respect thereto and, to the extent set forth in
the UCC in effect in the relevant state, the "proceeds" thereof, or it
constitutes a valid and continuing security interest (as defined in the
applicable UCC) in favor of the Trustee in such property, which security
interest is prior to all other Liens (as defined in the Agreement) except as
permitted under the Agreement, and is enforceable as such as against creditors
of and purchasers from such Transferor. Upon the filing of the financing
statements described in Section 3 of this Assignment and, in the case of the
Receivables hereafter created and the proceeds thereof, upon the creation
thereof, the Trustee shall have a first priority perfected security or ownership
interest in such property, except for (i) Liens permitted under clause (d) of
the definition of "Eligible Receivable" in the Agreement, (ii) the interests of
the holders of the Transferor Certificates under the Agreement and (iii) the
right to receive interest and investment earnings (net of losses and investment
expenses) in respect of the Collection Account as provided in the Agreement or
any Series Account if so provided in the applicable Supplement. The related
Receivables described in Section 3 of this Assignment constitute "accounts" or
"general intangibles" within the meaning of the applicable UCC;
(f) Creation. At the time of its transfer of any
Receivable to the Trustee pursuant to this Assignment, such Transferor owned and
had good and marketable title to such Receivable, free and clear of any Lien
(except as permitted under the Agreement), claim or encumbrance of any Person;
(g) Perfection. Such Transferor has caused or will have
caused, within ten (10) days of the initial execution of this Assignment, the
filing of all appropriate financing statements in the proper filing office in
the appropriate jurisdictions under applicable law in order to perfect the
security interest in the Receivables granted by such Transferor to the Trustee
pursuant to this Assignment;
(h) Priority. Other than the security interest granted to
the Trustee pursuant to this Assignment, such Transferor has not pledged,
assigned, sold, granted a security interest in, or otherwise conveyed the
Receivables described in Section 3 of this Assignment. Such Transferor has not
authorized the filing of and is not aware of any financing statement against
such Transferor that includes a description of such Receivables other than any
financing statement relating to the transfer and security interest granted to
the Trustee pursuant to the Agreement or this Assignment or that has been
terminated. Such Transferor is not aware of any judgment or tax lien filings
against such Transferor;
(i) No Conflict. The execution and delivery by such
Transferor of this Assignment, the performance by such Transferor of the
transactions contemplated by this Assignment and the fulfillment by such
Transferor of the terms hereof applicable to such Transferor, will not conflict
with or violate any Requirements of Law applicable to such Transferor or
conflict with, result in any breach of any of the material terms and provisions
of, or constitute (with or without notice or lapse of time or both) a material
default under, any indenture, contract, agreement, mortgage, deed of trust or
other instrument to which such Transferor is a party or by which it or its
properties are bound;
B-4
(j) No Proceedings. There are no proceedings or
investigations, pending or, to the best knowledge of such Transferor, threatened
against such Transferor before any court, regulatory body, administrative agency
or other tribunal or governmental instrumentality (i) asserting the invalidity
of this Assignment, (ii) seeking to prevent the consummation of any of the
transactions contemplated by this Assignment, (iii) seeking any determination or
ruling that, in the reasonable judgment of such Transferor, would materially and
adversely affect the performance by such Transferor of its obligations under
this Assignment or (iv) seeking any determination or ruling that would
materially and adversely affect the validity or enforceability of this
Assignment;
(k) All Consents. All authorizations, consents, orders or
approvals of any court or other governmental authority required to be obtained
by such Transferor in connection with the execution and delivery of this
Assignment by such Transferor and the performance of the transactions
contemplated by this Assignment by such Transferor, have been obtained; and
(l) List of Accounts. As of the Addition Date, to the best
knowledge of the Transferors, the computer files or lists of Additional Accounts
comply with the requirements of Section 2 hereof.
The representations and warranties in clauses (e) through (h)
above shall survive until the termination of the Agreement. Such representations
and warranties speak as of the date of this Assignment and as of the Addition
Date but shall not be waived by any of the parties to this Assignment unless
each Rating Agency shall have notified the Transferors, the Servicer and the
Trustee in writing that such waiver will not result in a reduction or withdrawal
of the rating of any outstanding Series or Class to which it is a Rating Agency.
6. Ratification of Agreement. As supplemented by this
Assignment, the Agreement is in all respects ratified and confirmed and the
Agreement as so supplemented by this Assignment shall be read, taken and
construed as one and the same instrument.
7. Counterparts. This Assignment may be executed in two or
more counterparts, and by different parties on separate counterparts, each of
which shall be an original, but all of which shall constitute one and the same
instrument.
8. GOVERNING LAW. THIS ASSIGNMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
B-5
IN WITNESS WHEREOF, each Transferor and the Trustee have
caused this Assignment to be duly executed by their respective officers as of
the day and year first above written.
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION II,
as a Transferor
By:
------------------------------------------
Name:
Title:
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION III LLC,
as a Transferor
By:
------------------------------------------
Name:
Title:
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION IV LLC,
as a Transferor
By:
------------------------------------------
Name:
Title:
X-0
XXX XXXX XX XXX XXXX, not in its individual
capacity, but solely as Trustee
By:
------------------------------------------
Name:
Title:
B-7
EXHIBIT C
FORM OF REASSIGNMENT OF RECEIVABLES IN REMOVED ACCOUNTS
(As required by Section 2.10 of
the Pooling and Servicing Agreement)
REASSIGNMENT No. [__] OF RECEIVABLES, dated as of [____],(2)/
by and among AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION II, a Delaware
corporation, AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION III LLC, a
Delaware limited liability company, and AMERICAN EXPRESS RECEIVABLES FINANCING
CORPORATION IV LLC, a Delaware limited liability company, as Transferors (each,
a "Transferor" and, collectively, the "Transferors"), and THE BANK OF NEW YORK,
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.
WITNESSETH:
WHEREAS, the Transferors, the Trustee and American Express
Travel Related Services Company, Inc., as servicer, are parties to the Pooling
and Servicing Agreement, dated as of May 16, 1996, as amended and restated as of
April 16, 2004 (as may be otherwise amended and supplemented from time to time,
the "Agreement");
WHEREAS, pursuant to the Agreement, [____], as a Transferor,
wishes to remove from the Trust all Receivables owned by the Trustee in certain
designated Accounts (the "Removed Accounts") and to cause the Trustee to
reconvey to such Transferor all the Trust's right, title and interest in, to and
under the Receivables then existing and thereafter created, all monies due or to
become due and all amounts received thereafter with respect thereto and all
proceeds thereof in or with respect to such Removed Accounts, whether now
existing or hereafter created; and
WHEREAS, the Trustee on behalf of the Trust 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 Transferors and the Trustee hereby agree
as follows:
1. Defined Terms. All terms defined in the Agreement and used
herein shall have such defined meanings when used herein, unless otherwise
defined herein.
"Removal Date" shall mean, with respect to the Removed
Accounts designated hereby, [__________], [_____].
"Removal Notice Date" shall mean, with respect to the Removed
Accounts, [__________], [_____].
(2) / To be dated as of the Removal Date.
C-1
2. Designation of Removed Accounts. On or before the date that
is five Business Days after the Removal Date, the relevant Transferor will
deliver to the Trustee a computer file or microfiche list containing a true and
complete list of the Removed Accounts, specifying for each such Removed Account,
as of the Removal Notice Date, its account number and the aggregate amount of
Receivables outstanding in such Removed Account, which computer file or
microfiche list shall be marked as Schedule 1 hereto, shall be incorporated
herein and made a part hereof, and shall supplement Schedule 1 to the Agreement.
3. Conveyance of Receivables. (a) The Trustee does hereby
transfer, assign, set over and otherwise convey to such Transferor, without
recourse, on and after the Removal Date, all right, title and interest of the
Trustee in, to and under the Receivables existing at the close of business on
the Removal Date and thereafter created from time to time in the Removed
Accounts designated hereby, all monies due or to become due and all amounts
received with respect thereto and all proceeds and Recoveries thereof.
(b) In connection with such transfer, the Trustee agrees
to execute and deliver to the Transferors on or prior to the date this
Reassignment is delivered, applicable termination statements prepared by the
Transferors with respect to the Receivables existing at the close of business on
the Removal Date and thereafter created from time to time in the Removed
Accounts reassigned hereby and the proceeds thereof evidencing the release by
the Trustee of its interest in the Receivables in the Removed Accounts, and
meeting the requirements of applicable state law, in such manner and such
jurisdictions as are necessary to terminate such interest.
4. Representations and Warranties of the Transferors. Each
Transferor hereby severally represents and warrants to the Trustee, on behalf of
the Trust, as of the Removal Date:
(a) Legal Valid and Binding Obligation. This Reassignment
constitutes a legal, valid and binding obligation of such Transferor enforceable
against such 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 except as such
enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity); and
(b) Pay Out Event. Such Transferor reasonably believes
that (A) the removal of the Receivables existing in the related Removed Accounts
will not, based on the facts known to such Transferor, then or thereafter cause
a Pay Out Event to occur with respect to any Series and (B) no selection
procedure was utilized by such Transferor which would result in a selection of
Removed Accounts that would be materially adverse to the interests of the
Investor Certificateholders of any Series as of the Removal Date.
(c) List of Removed Accounts. The list of Removed Accounts
delivered pursuant to Section 2.10 of the Agreement, as of the Removal Date, is
true and complete in all material respects.
C-2
5. Ratification of Agreement. As supplemented by this
Reassignment, the Agreement is in all respects ratified and confirmed and the
Agreement as so supplemented by this Reassignment shall be read, taken and
construed as one and the same instrument.
6. Counterparts. This Reassignment may be executed in two or
more counterparts, and by different parties on separate counterparts, each of
which shall be an original, but all of which shall constitute one and the same
instrument.
7. GOVERNING LAW. THIS REASSIGNMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS
CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
C-3
IN WITNESS WHEREOF, each Transferor and the Trustee have
caused this Reassignment to be duly executed by their respective officers as of
the day and year first above written.
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION II,
as a Transferor
By:
------------------------------------
Name:
Title:
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION III LLC,
as a Transferor
By:
------------------------------------
Name:
Title:
AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION IV LLC,
as a Transferor
By:
------------------------------------
Name:
Title:
THE BANK OF NEW YORK, not in its individual
capacity, but solely as Trustee
By:
------------------------------------
Name:
Title:
C-4
EXHIBIT D
FORM OF ANNUAL SERVICER'S CERTIFICATE
(To be delivered on or before March 31 of
each calendar year beginning with March 31, 2005,
pursuant to Section 3.05 of the Pooling and
Servicing Agreement referred to below)
AMERICAN EXPRESS TRAVEL RELATED SERVICES COMPANY, INC.
AMERICAN EXPRESS CREDIT ACCOUNT MASTER TRUST
The undersigned, a duly authorized representative of American
Express Travel Related Services Company, Inc., as Servicer ("TRS"), pursuant to
the Pooling and Servicing Agreement, dated as of May 16, 1996, as amended and
restated as of April 16, 2004 (as may be amended and supplemented, the
"Agreement"), among American Express Receivables Financing Corporation II, a
Delaware corporation, AMERICAN EXPRESS RECEIVABLES FINANCING CORPORATION III
LLC, a Delaware limited liability company, and AMERICAN EXPRESS RECEIVABLES
FINANCING CORPORATION IV LLC, a Delaware limited liability company, each as a
transferor, TRS, and The Bank of New York, as Trustee, does hereby certify that:
1. TRS is, as of the date hereof, the Servicer under the
Agreement. Capitalized terms used in this Certificate have their respective
meanings as set forth in the Agreement.
2. The undersigned is a Servicing Officer who is duly
authorized pursuant to the Agreement to execute and deliver this Certificate to
the Trustee.
3. A review of the activities of the Servicer during the year
ended December 31, ____, and of its performance under the Agreement was
conducted under my supervision.
4. Based on such review, the Servicer has, to the best of my
knowledge, performed in all material respects its obligations under the
Agreement throughout such year and no default in the performance of such
obligations has occurred or is continuing except as set forth in paragraph 5
below.
5. The following is a description of each default in the
performance of the Servicer's obligations under the provisions of the Agreement
known to me to have been made by the Servicer during the year ended December 31,
____ which sets forth in detail (i) the nature of each such default, (ii) the
action taken by the Servicer, if any, to remedy each such default and (iii) the
current status of each such default: [If applicable, insert "None."]
IN WITNESS WHEREOF, the undersigned has duly executed this
Certificate this ______ day of __________, 20 ____.
D-1
AMERICAN EXPRESS TRAVEL RELATED
SERVICES COMPANY, INC., as Servicer
By:
--------------------------------------
Name:
Title:
D-2
EXHIBIT E-1
FORM OF OPINION OF COUNSEL
WITH RESPECT TO AMENDMENTS
Provisions to be included in
Opinion of Counsel to be delivered pursuant
to Section 13.02(d)(i)
----------------------
The opinions set forth below may be subject to all the
qualifications, assumptions, limitations and exceptions taken or made in the
Opinions Of Counsel delivered on any applicable Closing Date.
(i) The amendment to the [Pooling and Servicing Agreement],
[Supplement], attached hereto as Schedule 1 (the "Amendment"), has been
duly authorized, executed and delivered by the Transferors and
constitutes the legal, valid and binding agreement of the Transferors,
enforceable in accordance with its terms, except as such enforceability
may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws from time to time in effect affecting
creditors' rights generally. The enforceability of the Transferors'
obligations is also subject to general principles of equity (regardless
of whether such enforceability is considered in a proceeding in equity
or at law).
(ii) The Amendment has been entered into in accordance with
the terms and provisions of Section 13.01 of the Pooling and Servicing
Agreement.
E-1-1
EXHIBIT E-2
FORM OF OPINION OF COUNSEL
WITH RESPECT TO ACCOUNTS
Provisions to be included in
Opinion of Counsel to be
delivered pursuant to
subsection 13.02(d)(ii) or (iii)
--------------------------------
The opinions set forth below may be subject to all the
qualifications, assumptions, limitations and exceptions taken or made in the
Opinions of Counsel delivered on any applicable Closing Date.
1. The Pooling and Servicing Agreement creates in favor of the
Trustee a security interest in the rights of the relevant Transferor in the
Receivables identified in Schedule 1 to the Pooling and Servicing Agreement and
the identifiable proceeds thereof.
2. The security interest described in the paragraph above is
perfected and of first priority.
E-2-1
EXHIBIT E-3
PROVISIONS TO BE INCLUDED IN
ANNUAL OPINION OF COUNSEL
The opinions set forth below may be subject to all the
qualifications, assumptions, limitations and exceptions taken or made in the
Opinions of Counsel delivered on any applicable Closing Date. Unless otherwise
indicated, all capitalized terms used herein shall have the meanings ascribed to
them in the Pooling and Servicing Agreement and in the Assignment.
1. The security interest created by the Pooling and Servicing
Agreement in favor of the Trustee in the rights of the relevant Transferor in
the Receivables identified in Schedule 1 to the Pooling and Servicing Agreement
and the identifiable proceeds thereof is perfected and of first priority.
E-3-1
EXHIBIT F-1
[FORM OF CLEARANCE SYSTEM CERTIFICATE
TO BE GIVEN TO THE TRUSTEE BY
EUROCLEAR OR CLEARSTREAM FOR
DELIVERY OF DEFINITIVE CERTIFICATES
IN EXCHANGE FOR A PORTION OF A
TEMPORARY GLOBAL SECURITY]
AMERICAN EXPRESS CREDIT ACCOUNT MASTER TRUST,
Class [_____] Series [200 - ] [Floating Rate] [ %]
Asset Backed Certificates
[Insert title or sufficient description of
Certificates to be delivered]
We refer to that portion of the temporary Global Certificate in respect
of the above-captioned issue which is herewith submitted to be exchanged for
definitive Certificates (the "Submitted Portion") as provided in the Pooling and
Servicing Agreement, dated as of May 16, 1996, as amended and restated as of
April 16, 2004 (as amended and supplemented, the "Agreement") in respect of such
issue. This is to certify that (i) we have received a certificate or
certificates, in writing or by tested telex, with respect to each of the persons
appearing in our records as being entitled to a beneficial interest in the
Submitted Portion and with respect to such persons beneficial interest either
(a) from such person, substantially in the form of Exhibit G-2 to the Agreement,
or (b) from [ ], substantially in the form of Exhibit G-3 to the Agreement, and
(ii) the Submitted Portion includes no part of the temporary Global Certificate
excepted in such certificates
We further certify that as of the date hereof we have not received any
notification from any of the persons giving such certificates to the effect that
the statements made by them with respect to any part of the Submitted Portion
are no longer true and cannot be relied on as of the date hereof.
We understand that this certificate is required in connection with
certain securities and tax laws in the United States of America. If
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate or a copy thereof to any interested party in
such proceedings.
Dated:(3)/
[Euroclear Bank S.A. / N.V., as operator of the
Euroclear Systems](4)/
[Clearstream Banking, societe anonyme](2)/
By:
---------------------------------------------
-------------------
(3) / To be dated on the Exchange Date.
(4) / Delete the inappropriate reference.
F-1-1
EXHIBIT F-2
[FORM OF CERTIFICATE TO BE DELIVERED
TO EUROCLEAR OR CLEARSTREAM
BY [INSERT NAME OF MANAGER]
WITH RESPECT TO REGISTERED CERTIFICATES SOLD TO
QUALIFIED INSTITUTIONAL BUYERS]
AMERICAN EXPRESS CREDIT ACCOUNT MASTER TRUST,
Class [_____] Series [200 - ] [Floating Rate] [ %]
Asset Backed Certificates
In connection with the initial issuance and placement of the
above referenced Asset Backed Certificates (the "Certificates"), an
institutional investor in the United States ("institutional investor") is
purchasing U.S. $ aggregate principal amount of the Certificates held in our
account at [Euroclear Bank S.A. / N.V., as operator of the Euroclear System]
[Clearstream] on behalf of such investor.
We reasonably believe that such institutional investor is a
qualified institutional buyer as such term is defined under Rule 144A of the
Securities Act of 1933, as amended.
[We understand that this certificate is required in connection
with United States laws. We irrevocably authorize you to produce this
certificate or a copy hereof to any interested party in any administrative or
legal proceedings or official inquiry with respect to the matters covered by
this certificate.]
The Definitive Certificates in respect of this certificate are
to be issued in registered form in the minimum denomination of U.S. $500,000 and
such Definitive Certificates (and, unless the Pooling and Servicing Agreement or
Supplement relating to the Certificates otherwise provides, any Certificates
issued in exchange or substitution for or on registration of transfer of
Certificates) shall bear the following legend:
"THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933 NEITHER THIS CERTIFICATE NOR ANY PORTION HEREOF MAY BE
OFFERED OR SOLD, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES OR TO U.S. PERSONS
(EACH AS DEFINED HEREIN), EXCEPT IN COMPLIANCE WITH THE REGISTRATION PROVISIONS
OF SUCH ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION
PROVISIONS. THE TRANSFER OF THIS CERTIFICATE IS SUBJECT TO CERTAIN CONDITIONS
SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN. THIS
CERTIFICATE CANNOT BE EXCHANGED FOR A BEARER CERTIFICATE."
Dated:
[ ],
By:
-------------------------------------
Authorized Officer
F-2-1
EXHIBIT F-3
[FORM OF CERTIFICATE TO BE DELIVERED
TO EUROCLEAR OR CLEARSTREAM BY A BENEFICIAL OWNER
OF CERTIFICATES, OTHER THAN A QUALIFIED INSTITUTIONAL BUYER]
AMERICAN EXPRESS CREDIT ACCOUNT MASTER TRUST,
Class [____] Series [200 - ] [Floating Rate] [ %]
Asset Backed Certificates
This is to certify that as of the date hereof and except as
provided in the third paragraph hereof, the above-captioned Certificates held by
you for our account (i) are owned by a person that is a United States person, or
(ii) are owned by a United States person that is (A) the foreign branch of a
United States financial institution (as defined in U.S. Treasury Regulations
Section 1.165-12(c)(1)(v)) (a "financial institution") purchasing for its own
account or for resale, or (B) a United States person who acquired the
Certificates through the foreign branch of a financial institution and who holds
the Certificates through the financial institution on the date hereof (and in
either case (A) or (B), the financial institution hereby agrees to comply with
the requirements of Section 165(j)(3)(A), (B) or (C) of the Internal Revenue
Code of 1986, as amended, and the regulations thereunder), or (iii) are owned by
a financial institution for purposes of resale during the Restricted Period (as
defined in U.S. Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)). In
addition, financial institutions described in clause (iii) of the preceding
sentence (whether or not also described in clause (i) or (ii)) certify that they
have not acquired the Certificates for purposes of resale directly or indirectly
to a United States person or to a person within the United States or its
possessions.
We undertake to advise you by tested telex if the above
statement as to beneficial ownership is not correct on the date of delivery of
the above-captioned Certificates in bearer form with respect to such of said
Certificates as then appear in your books as being held for our account.
This certificate excepts and does not relate to U.S. $_______
principal amount of Certificates held by you for our account, as to which we are
not yet able to certify beneficial ownership. We understand that delivery of
Definitive Certificates in such principal amount cannot be made until we are
able to so certify.
We understand that this certificate is required in connection
with certain securities and tax laws in the United States of America. If
administrative or legal proceedings are commenced or threatened in connection
with which this certificate is or would be relevant, we irrevocably authorize
you to produce this certificate or a copy thereof to any interested party in
such proceedings. As used herein, "United States" means the United States of
America (including the States and the District of Columbia), its territories,
its possessions and other areas subject to its jurisdiction; and "United States
Person" means a citizen or resident of the United States, a corporation,
partnership or other entity created or organized in or under the laws of the
United States, or any political subdivision thereof, or an estate or trust the
income of which is subject to United States federal income taxation regardless
of its source.
Dated:(5)/
By:
----------------------------------------------
As, or an agent for, the beneficial owner(s) of
the interest in the Certificates to which this
certificate relates.
(5) / This Certificate must be dated on the earlier of the date of the first
actual payment of interest in respect of the Certificates and the date of
the delivery of the Certificates in definitive form.
F-3-1
EXHIBIT G-1
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "1933 ACT"). NEITHER THIS CERTIFICATE NOR ANY PORTION
HEREOF MAY BE OFFERED, SOLD, PLEDGED, OR OTHERWISE TRANSFERRED EXCEPT IN
COMPLIANCE WITH THE REGISTRATION PROVISIONS OF THE 1933 ACT AND ANY APPLICABLE
PROVISIONS OF ANY STATE BLUE SKY OR SECURITIES LAWS OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM SUCH REGISTRATION PROVISIONS. THE TRANSFER OF THIS CERTIFICATE IS
SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN.
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A BENEFIT
PLAN (AS DEFINED BELOW).
G-1-1
EXHIBIT G-2
[FORM OF UNDERTAKING LETTER]
[Date]
The Bank of New York
000 Xxxxxxx Xxxxxx, Xxxxx 0 Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Asset Backed Group
American Express Receivables Financing Corporation II
American Express Tower
World Financial Center
000 Xxxxx Xxxxxx, Xxxx 000
Xxx Xxxx, Xxx Xxxx 00000
Attention: President
American Express Receivables Financing Corporation III LLC
[address]
American Express Receivables Financing Corporation IV LLC
[address]
Re: Purchase of $______________________(6)/ principal amount of
American Express Credit Account Master Trust
Class [____] Series [20_ - ] [Floating Rate] [ %] Asset
Backed Certificates
Ladies and Gentlemen:
In connection with our purchase of the above-referenced Asset
Backed Certificates (the "Certificates") we confirm that:
(i) we understand that the Certificates are not being
registered under the Securities Act of 1933, as amended (the
"1933 Act"), and are being sold to us in a transaction that is
exempt from the registration requirements of the 1933 Act;
(ii) any information we desire concerning the
Certificates or any other matter relevant to our decision to
purchase the certificates is or has been made available to us;
------------------
(6) / Not less than $250,000 minimum principal amount.
G-2-1
(iii) we have such knowledge and experience in financial
and business matters as to be capable of evaluating the merits
and risks of an investment in the Certificates, and we (and
any account for which we are purchasing under paragraph (iv)
below) are able to bear the economic risk of an investment in
the Certificates; we (and any account for which we are
purchasing under paragraph (iv) below) are an "accredited
investor" (as such term is defined in Rule 501(a)(1), (2) or
(3) of Regulation D under the 0000 Xxx); and we are not, and
none of such accounts is, a Benefit Plan;
(iv) we are acquiring the Certificates for our own
account or for accounts as to which we exercise sole
investment discretion and not with a view to any distribution
of the Certificates, subject, nevertheless, to the
understanding that the disposition of our property shall at
all times be and remain within our control;
(v) we agree that the Certificates must be held
indefinitely by us unless subsequently registered under the
1933 Act or an exemption from any registration requirements of
that Act and any applicable state securities laws available;
(vi) we agree that in the event that at some future time
we wish to dispose of or exchange any of the Certificates
(such disposition or exchange not being currently foreseen or
contemplated), we will not transfer or exchange any of the
Certificates unless
(a) (l) the sale is of at least U.S. $250,000 principal
amount of Certificates to an Eligible Purchaser (as defined
below), (2) a letter to substantially the same effect as
paragraphs (i), (ii), (iii), (iv), (v) and (vi) of this letter
is executed promptly by the purchaser and (3) all offers or
solicitations in connection with the sale, whether directly or
through any agent acting on our behalf, are limited only to
Eligible Purchasers and are not made by means of any form of
general solicitation or general advertising whatsoever; or
(b) the Certificates are transferred pursuant to Rule 144
under the 1933 Act by us after we have held them for more than
three years; or
(c) the Certificates are sold in any other transaction
that does not require registration under the 1933 Act and, if
the Transferors, the Servicer, the Trustee or the Transfer
Agent and Registrar so requests, we theretofore have furnished
to such party an opinion of counsel satisfactory to such
party, in form and substance satisfactory to such party, to
such effect; or
(d) the Certificates are transferred pursuant to an
exception from the registration requirements of the 1933 Act
under Rule 144A under the 1933 Act; and
(vii) we understand that the Certificates will bear a
legend to substantially the following effect:
G-2-2
"THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "1933 ACT") NEITHER THIS CERTIFICATE NOR ANY PORTION
HEREOF MAY BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN
COMPLIANCE WITH THE REGISTRATION PROVISIONS OF THE 1933 ACT AND ANY APPLICABLE
PROVISIONS OF ANY STATE BLUE SKY OR SECURITIES LAWS OR PURSUANT TO AN AVAILABLE
EXEMPTION FROM SUCH REGISTRATION PROVISIONS. THE TRANSFER OF THIS CERTIFICATE IS
SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT
REFERRED TO HEREIN."
"THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A
BENEFIT PLAN (AS DEFINED BELOW)."
The first paragraph of this legend may be removed if the Transferors, the
Servicer, the Trustee and the Transfer Agent and Registrar have received an
opinion of counsel satisfactory to them, in form and substance satisfactory to
them, to the effect that such paragraph may be removed.
"Eligible Purchaser" means either an Eligible Dealer or a corporation,
partnership or other entity which we have reasonable grounds to believe and do
believe can make representations with respect to itself to substantially the
same effect as the representations set forth herein. "Eligible Dealer" means any
corporation or other entity the principal business of which is acting as a
broker and/or dealer in securities. "Benefit Plan" means any employee benefit
plan, trust or account, including an individual retirement account, that is
subject to the Employee Retirement Income Security Act of 1974, as amended, or
that is described in Section 4975(e)(1) of the Internal Revenue Code of 1986, as
amended, or an entity whose underlying assets include plan assets by reason of a
plan's investment in such entity. Capitalized terms used but not defined herein
shall have the meanings given to such terms in the Pooling and Servicing
Agreement, dated as of May 16, 1996, as amended and restated as of April 16,
2004, among American Express Receivables Financing Corporation II, American
Express Receivables Financing Corporation III LLC and American Express
Receivables Financing Corporation IV LLC, each as transferor, American Express
Travel Related Services Company, Inc., as servicer, and The Bank of New York, as
trustee.
Very truly yours,
(Name of Purchaser)
By:
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(Authorized Officer)
G-2-3
EXHIBIT G-3
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A BENEFIT PLAN
(AS DEFINED BELOW).(7)/
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(7) / The following text should be included in any Certificate in which the
above legend appears: The [Certificates] may not be acquired by or for the
account of any employee benefit plan, trust or account, including an
individual retirement account, that is subject to the Employee Retirement
Income Security Act of 1974, as amended, or that is described in Section
4975(e)(1) of the Internal Revenue Code of 1986, as amended, or an entity
whose underlying assets include plan assets by reason of a plan's
investment in such entity (a "Benefit Plan"). By accepting and holding
this Certificate, the Holder hereof shall be deemed to have represented
and warranted that it is not a Benefit Plan. By acquiring any interest in
this Certificate, the applicable Certificate Owner or Owners shall be
deemed to have represented and warranted that it or they are not Benefit
Plans.
G-3-1
SCHEDULE 1
List of Accounts
[Delivered to Trustee]
