FORM 8-K
CURRENT REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
333-60418, 333-60418-01 31-1772814
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(COMMISSION FILE NUMBER) (I.R.S. EMPLOYER IDENTIFICATION NO.)
220 West Schrock Road, Westerville, Ohio 43801
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(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES) (ZIP CODE)
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ITEM 5. OTHER EVENTS.
On August 21, 2001, World Financial Network Credit Card Master Note Trust issued $702,000,000 Class A Series 2001-A Asset Backed Notes and $76,500,000 Class B Series 2001-A Asset Backed Notes (collectively, the "Notes") described in a Prospectus Supplement dated August 9, 2001 to Prospectus dated August 9, 2001.
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits.
EXHIBIT
NO. DOCUMENT DESCRIPTION
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(a) Not applicable
(b) Not applicable
(c) Exhibit 1.1 Underwriting Agreement, dated August 1, 2001,
among JP Morgan Securities Inc., Representative
of the Underwriters, WFN Credit Company, LLC and
World Financial Network National Bank
Exhibit 3.1 Amended and Restated Limited Liability Company
Agreement of WFN Credit Company, LLC.
Exhibit 4.1 Master Indenture, dated as of August 1, 2001,
between World Financial Network Credit Card
Master Note Trust and BNY Midwest Trust Company
Exhibit 4.2 Indenture Supplement, dated as of August 21, 2001,
between World Financial Network Credit Card Master
Note Trust and BNY Midwest Trust Company, including
form of World Financial Network Credit Card Master
Note Trust Series 2001-A Floating Rate Asset Backed
Notes
Exhibit 4.3 Transfer and Servicing Agreement, dated as of
August 1, 2001, between WFN Credit Company, LLC,
World Financial Network National Bank and World
Financial Network Credit Card Master Note Trust
Exhibit 4.4 Amended and Restated Trust Agreement, dated as of
August 1, 2001, between WFN Credit Company, LLC
and Chase Manhattan Bank USA, National
Association
Exhibit 4.5 Administration Agreement, dated as of August 1,
2001, between World Financial Network Credit Card
Master Note Trust and World Financial Network
National Bank
Exhibit 4.6 Second Amended and Restated Pooling and Servicing
Agreement, dated as of January 17, 1996, amended
and restated as of September 17, 1999 and amended
and restated a second time as of August 1, 2001,
between WFN Credit Company, LLC, World Financial
Network National Bank and BNY Midwest Trust Company
Exhibit 4.7 Collateral Series Supplement, dated as of August 21,
2001, between WFN Credit Company, LLC, World
Financial Network National Bank and BNY Midwest
Trust Company, including form of Collateral
Certificate
Exhibit 4.8 Receivables Purchase Agreement, dated August 1,
2001, between World Financial Network National
Bank and WFN Credit Company, LLC
Exhibit 4.9 ISDA Master Agreement, dated August 21, 2001
between Morgan Guaranty Trust Company of New York
and World Financial Network Credit Card Master
Note Trust
Exhibit 4.10 Schedule A to ISDA Master Agreement, dated
August 21, 2001 between Morgan Guaranty Trust
Company of New York and World Financial Network
Credit Card Master Note Trust
Exhibit 4.11 Class A Confirmation for U.S. Dollar Interest
Rate Swap Transaction under 2001 Master
Agreement, dated August 21, 2001 between Morgan
Guaranty Trust
-2-
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Company of New York and World Financial Network
Credit Card Master Note Trust
Exhibit 4.12 Class B Confirmation for U.S. Dollar Interest Rate
Swap Transaction under 2001 Master Agreement, dated
August 21, 2001 between Morgan Guaranty Trust
Company of New York and World Financial Network
Credit Card Master Note Trust
Exhibit 4.13 Class C Confirmation for U.S. Dollar Interest Rate
Swap Transaction under 2001 Master Agreement, dated
August 21, 2001 between Morgan Guaranty Trust
Company of New York and World Financial Network
Credit Card Master Note Trust
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
WFN CREDIT COMPANY, LLC
(Co-Registrant)
Dated: August 31, 2001 By: /s/ Robert Armiak
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Name: Robert Armiak
Title: Vice President and Treasurer
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WORLD FINANCIAL NETWORK CREDIT
CARD MASTER TRUST
(Co-Registrant)
By: WORLD FINANCIAL NETWORK NATIONAL BANK,
as servicer
Dated: August 31, 2001 By: /s/ Robert Armiak
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Name: Robert Armiak
Title: Vice President and Treasurer
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Exhibit 1.1
August 9, 2001
World Financial Network Credit Card Master Note Trust $702,000,000 Class A Floating Rate Asset Backed Notes, Series 2001-A $76,500,000 Class B Floating Rate Asset Backed Notes, Series 2001-A
J. P. Morgan Securities Inc.,
as Representative of the
Underwriters set forth herein (the "REPRESENTATIVE")
270 Park Avenue
New York, New York 10017
Ladies and Gentlemen:
1. INTRODUCTORY. WFN Credit Company, LLC ("WFN LLC") proposes to cause World Financial Network Credit Card Master Note Trust (the "ISSUER") to issue $702,000,000 aggregate principal amount of World Financial Network Credit Card Master Note Trust Class A Floating Rate Asset Backed Notes, Series 2001-A (the "CLASS A NOTES"), $76,500,000 aggregate principal amount of World Financial Network Credit Card Master Note Trust Class B Floating Rate Asset Backed Notes, Series 2001-A (the "CLASS B NOTES"), and $121,500,000 aggregate principal amount of World Financial Network Credit Card Master Note Trust Class C Asset Backed Notes, Series 2001-A (the "CLASS C NOTES" and, together with the Class A Notes and the Class B Notes, the "NOTES"). The Class A Notes and the Class B Notes are referred to herein, collectively, as the "OFFERED NOTES."
The Issuer will be a Delaware statutory business trust formed pursuant to (a) a Trust Agreement, to be dated as of August 1, 2001 (the "TRUST AGREEMENT"), between WFN LLC, as transferor (the "TRANSFEROR"), and Chase Manhattan Bank USA, National Association ("CHASE"), as owner trustee (the "OWNER TRUSTEE"), and (b) the filing of a certificate of trust with the Secretary of State of Delaware on July 27, 2001. The Notes will be issued pursuant to a Master Indenture, to be dated as of August 1, 2001 (the "MASTER INDENTURE"), between the Issuer and BNY Midwest Trust Company, as indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the Series 2001-A Indenture Supplement with respect to the Notes, to be dated as of August 21, 2001 (the "INDENTURE SUPPLEMENT" and, together with the Master Indenture, the "INDENTURE").
Initially, the primary asset of the Issuer will be a certificate (the "COLLATERAL CERTIFICATE") representing a beneficial interest in the assets held in the World Financial Network Credit Card Master Trust ("WFNMT"), to be issued pursuant to the Second Amended and Restated Pooling and Servicing Agreement, dated as of January 17, 1996, amended and restated as of September 17, 1999 and amended and restated a second time as of August 1, 2001 (as heretofore amended, the "AMENDED AND RESTATED POOLING AND SERVICING AGREEMENT"), among the Transferor, World Financial Network National Bank (the "BANK"), as servicer (the "SERVICER"), and BNY Midwest Trust Company (successor-in-interest to the corporate trust administration of Harris Trust and Savings Bank), as trustee (the "WFNMT TRUSTEE"), and the Collateral Series Supplement to the Amended and Restated Pooling and Servicing Agreement, to be dated as of August 21, 2001 (the "COLLATERAL SUPPLEMENT" and, together with the Amended and Restated Pooling and Servicing Agreement, the "PSA"). The assets of WFNMT include, among other things, certain amounts due (the "RECEIVABLES") on a pool of private label credit card accounts of the Bank (the "ACCOUNTS").
The Receivables are transferred to WFNMT pursuant to the Amended and Restated Pooling Servicing Agreement. The Receivables transferred to WFNMT by the Transferor will be acquired by the Transferor from the Bank pursuant to a Receivables Purchase Agreement, to be dated as of August 1, 2001 (as amended, the "RECEIVABLES PURCHASE AGREEMENT"), between WFN LLC and the Bank. The Collateral Certificate will be transferred by the Transferor to the Issuer pursuant to the Transfer and Servicing Agreement, to be dated as of August 1, 2001 (the "TSA"), among the Transferor, the Servicer, and the Issuer.
The Bank will agree to provide notices and perform on behalf of the Issuer certain other administrative obligations required by the TSA, the Master Indenture and each indenture supplement for each series of notes issued by the Issuer, pursuant to an Administration Agreement, to be dated as of August 1, 2001 (the "ADMINISTRATION AGREEMENT"), between the Bank, as administrator (in such capacity, the "ADMINISTRATOR"), and the Issuer. The TSA, the PSA, the Receivables Purchase Agreement, the Indenture, the Trust Agreement and the Administration Agreement are referred to herein, collectively, as the "PROGRAM DOCUMENTS."
This Underwriting Agreement is referred to herein as this "AGREEMENT." To the extent not defined herein, capitalized terms used herein have the meanings assigned in the Transaction Documents.
The Class C Notes will be sold pursuant to a Class C Note Purchase Agreement, to be dated as of August 21, 2001 (the "CLASS C NOTE PURCHASE AGREEMENT" and, together with the Program Documents, the "TRANSACTION DOCUMENTS"), among the Issuer, the Bank, WFN LLC and the initial purchaser of the Class C Notes named therein.
The Transferor and the Bank hereby agree, severally and not jointly, with the underwriters for the Class A Notes listed on SCHEDULE A hereto (the "CLASS A UNDERWRITERS") and the underwriters for the Class B Notes listed on SCHEDULE A hereto (the "CLASS B UNDERWRITERS" and, together with the Class A Underwriters, the "UNDERWRITERS") as follows:
2. REPRESENTATIONS AND WARRANTIES OF THE TRANSFEROR AND THE BANK. Each of the Transferor (the representations and warranties as to the Transferor being given by the Transferor) and the Bank (the representations and warranties as to the Bank being given by the Bank) represents and warrants to, and agrees with, the Underwriters that:
(a) The Transferor is duly organized, validly existing and in good standing as a limited liability company under the laws of the State of Delaware, and has all requisite power, authority and legal right to own its property, transact the business in which it is now engaged and conduct its business as described in the Registration Statement and Prospectus, and to execute, deliver and perform its obligations under this Agreement, the TSA, the PSA, the Receivables Purchase Agreement and the Trust Agreement and to authorize the issuance of the Notes and the Collateral Certificate.
(b) The Bank is a national banking association duly organized, validly existing and in good standing under the laws of the United States, and has all requisite power, authority and legal right to own its property and conduct its credit card business as such properties are presently owned and such business is presently conducted, and conduct its business as described in the Registration Statement (as hereinafter defined) and Prospectus (as hereinafter defined), and to own the Accounts and to execute, deliver and perform its obligations under the Receivables Purchase Agreement, the TSA, the PSA and the Administration Agreement.
(c) The execution, delivery and performance of each of the Transaction Documents to which it is a party, and the incurrence of the obligations herein and therein set forth and the consummation of the transactions contemplated hereby and thereby, and with respect to the Transferor, the issuance of the Notes and the Collateral Certificate, have been duly and validly authorized by the Transferor and the Bank, as applicable, by all necessary action on the part of the Transferor and the Bank, as applicable.
(d) This Agreement has been duly authorized, executed and delivered by the Transferor and the Bank.
(e) Each of the Program Documents has been, or on or before the Closing Date will be, executed and delivered by the Transferor and the Bank, as applicable, and when executed and delivered by the other parties thereto, will constitute a valid and binding agreement of the Transferor and the Bank, as applicable, enforceable against the Transferor and the Bank, as applicable, in accordance with its terms, except, in each case, to the extent that (i) the enforceability thereof may be subject to bankruptcy, insolvency, reorganization, moratorium, receivership or other similar laws now or hereafter in effect relating to creditors' or other obligees' rights generally or the rights of creditors or other obligees of institutions insured by the FDIC, (ii) the remedy of specific performance and injunctive and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any proceeding therefor may be brought and (iii) certain remedial provisions of the Indenture may be unenforceable in whole or in part under the UCC, but the inclusion of such provisions does not render the other provisions of the Indenture
invalid and notwithstanding that such provisions may be unenforceable in whole or in part, the Indenture Trustee, on behalf of the Noteholders, will be able to enforce the remedies of a secured party under the UCC.
(f) The Notes have been duly authorized and will be issued pursuant to the terms of the Indenture and, when executed by the Owner Trustee on behalf of the Issuer and authenticated by the Indenture Trustee in accordance with the Indenture and delivered pursuant to the Indenture and this Agreement, will be duly and validly executed, issued and outstanding and will constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms, subject to (A) the effect of bankruptcy, insolvency, moratorium, receivership, reorganization, liquidation and other similar laws affecting creditors' rights generally, (B) the effect of general principles of equity including (without limitation) concepts of materiality, reasonableness, good faith, fair dealing (regardless of whether considered and applied in a proceeding in equity or at law), and also to the possible unavailability of specific performance or injunctive relief, and (C) the unenforceability under certain circumstances of provisions indemnifying a party against liability or requiring contribution from a party for liability where such indemnification or contribution is contrary to public policy. The Notes will be in the form contemplated by the Indenture, and the Offered Notes and the Indenture will conform to the descriptions thereof contained in the Prospectus and Registration Statement, as amended or supplemented.
(g) The Collateral Certificate will be issued pursuant to the terms of the PSA and, when executed and authenticated by the WFNMT Trustee in accordance with the PSA, will be validly issued and outstanding. The Collateral Certificate will be in the form contemplated by the PSA, and the Collateral Certificate and the PSA will conform to the descriptions thereof contained in the Prospectus and the Registration Statement, as amended or supplemented.
(h) Neither the Transferor nor the Bank is in violation of any Requirement of Law or in default in the performance or observance of any obligation, agreement, covenant or condition contained in any contract, indenture, mortgage, deed of trust, loan agreement, note, lease or other instrument to which it is a party or by which it is bound or to which any of its property is subject, which violation or defaults separately or in the aggregate would have a material adverse effect on the Transferor or the Bank.
(i) None of the issuance and sale of the Notes, the issuance of the Collateral Certificate or the execution and delivery by the Transferor or the Bank of this Agreement or any Transaction Document to which it is a party, nor the incurrence by the Transferor or the Bank of the obligations herein and therein set forth, nor the consummation of the transactions contemplated hereunder or thereunder, nor the fulfillment of the terms hereof or thereof does or will (i) violate any Requirement of Law presently in effect, applicable to it or its properties or by which it or its properties are or may be bound or affected, (ii) conflict with, or result in a breach of, or constitute a default under, any material indenture, contract, agreement, mortgage, deed of trust or instrument to which it is a party or by which it or its
properties are bound or (iii) result in the creation or imposition of any Lien upon any of its property or assets, except for those encumbrances created under the Transaction Documents.
(j) All approvals, authorizations, consents, orders and other actions of any Person or of any court or other governmental body or official required in connection with the execution and delivery by the Transferor or the Bank of this Agreement or the Transaction Documents to which it is a party or to the consummation of the transactions contemplated hereunder and thereunder, or to the fulfillment of the terms hereof and thereof have been or will have been obtained on or before the Closing Date.
(k) The Bank has authorized the conveyance of the Receivables to the Transferor and WFNMT, as applicable; the Transferor has authorized the conveyance of the Receivables to WFNMT; the Transferor has authorized WFNMT to issue the Collateral Certificate; and the Transferor has authorized the Issuer to issue and sell the Notes.
(l) All actions required to be taken by the Transferor or the Bank as a condition to the offer and sale of the Notes as described herein or the consummation of any of the transactions described in the Prospectus and the Registration Statement have been or, prior to the Closing Date, will be taken.
(m) The Indenture has been duly qualified under the Trust Indenture Act of 1939, as amended (the "TIA"), and complies as to form with the TIA and the rules and regulations of the Securities and Exchange Commission (the "COMMISSION") thereunder.
(n) The representations and warranties made by the Transferor in the TSA, the PSA, the Trust Agreement and the Receivables Purchase Agreement or made in any Officer's Certificate of the Transferor delivered pursuant to any Transaction Document to which it is a party will be true and correct in all material respects at the time made and on and as of the Closing Date as if set forth herein, except that to the extent that any such representation or warranty expressly relates to an earlier date, such representation or warranty is true and correct at and as of such earlier date.
(o) The representations and warranties made by the Bank in the Receivables Purchase Agreement, and in its capacity as Servicer and Administrator, in the TSA, the PSA and the Administration Agreement, respectively, or made in any Officer's Certificate of the Bank delivered pursuant to any Transaction Document to which it is a party will be true and correct in all material respects at the time made and on and as of the Closing Date as if set forth herein, except that to the extent that any such representation or warranty expressly relates to an earlier date, such representation or warranty is true and correct at and as of such earlier date.
(p) The Transferor agrees it has not granted, assigned, pledged or transferred and shall not grant, assign, pledge or transfer to any Person a security interest in, or any other right, title or interest in, the Receivables or the Collateral Certificate, except as
provided in the PSA and the TSA, and agrees to take all action required by the PSA and the TSA in order to maintain the security interest in the Receivables and the Collateral Certificate granted pursuant to the PSA and the TSA, as applicable.
(q) The Bank agrees it has not granted, assigned, pledged or transferred and shall not grant, assign, pledge or transfer to any Person a security interest in, or any other right, title or interest in, the Receivables, except as provided in the PSA or the Receivables Purchase Agreement, as applicable, and agrees to take all action required by the PSA or the Receivables Purchase Agreement, as applicable, in order to maintain the security interests in the Receivables granted pursuant to the Receivables Purchase Agreement and the PSA, as applicable.
(r) A registration statement on Form S-3 (Nos. 333-60418 and 333-60418-01), including a form of prospectus and such amendments thereto as may have been filed prior to the date hereof, relating to the Offered Notes and the offering thereof in accordance with Rule 415 under the Securities Act of 1933, as amended (the "ACT"), has been filed with, and has been declared effective by, the Commission. If any post-effective amendment to such registration statement has been filed with the Commission prior to the execution and delivery of this Agreement, the most recent such amendment has been declared effective by the Commission. For purposes of this Agreement, "EFFECTIVE TIME" means the date and time as of which such registration statement, or the most recent post-effective amendment thereto, if any, was declared effective by the Commission, and "EFFECTIVE DATE" means the date of the Effective Time. Such registration statement, as amended at the Effective Time, is hereinafter referred to as the "REGISTRATION STATEMENT." The Transferor proposes to file with the Commission pursuant to Rule 424(b) ("RULE 424(b)") under the Act a supplement (the "PROSPECTUS SUPPLEMENT") to the prospectus included in the Registration Statement (such prospectus, in the form it appears in the Registration Statement or in the form most recently revised and filed with the Commission pursuant to Rule 424(b), is hereinafter referred to as the "BASE PROSPECTUS") relating to the Offered Notes and the method of distribution thereof. The Base Prospectus and the Prospectus Supplement, together with any amendment thereof or supplement thereto, are hereinafter referred to as the "PROSPECTUS".
(s) On the Effective Date, the Registration Statement did or will conform in all material respects to the applicable requirements of the Act and the rules and regulations of the Commission thereunder (the "RULES AND REGULATIONS") and the TIA and the rules and regulations thereunder and did not or will not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and on the date of this Agreement, the Registration Statement and the Prospectus conform, and at the time of filing of the Prospectus pursuant to Rule 424(b) the Registration Statement and the Prospectus will conform, in all material respects with the requirements of the Act and the Rules and Regulations and the TIA and the rules and regulations thereunder and neither of such documents includes, or will include, any untrue statement of a material fact or omits, or will omit, to state any material fact required to be stated therein or necessary to make the statements therein not
misleading, except that the foregoing does not apply to statements in or omissions from either of such documents based upon written information furnished to the Transferor or the Bank by the Underwriters specifically for use therein. Each of the Transferor and the Bank hereby acknowledges that (i) the only information provided by the Class A Underwriters for inclusion in the Registration Statement and the Prospectus is set forth on the cover page of the Prospectus Supplement in the table under the heading "Class A Notes" and on the line across from "Price to public," in the table listing the Class A Underwriters and the Principal Amount of Class A Notes under the heading "Underwriting" in the Prospectus Supplement, in the table following the third paragraph under the heading "Underwriting" in the Prospectus Supplement in the column labeled "Class A Notes", and in the final paragraph under the heading "Underwriting" in the Prospectus Supplement (the "CLASS A UNDERWRITERS' INFORMATION") and (ii) the only information provided by the Class B Underwriters for inclusion in the Registration Statement and the Prospectus is set forth on the cover page of the Prospectus Supplement in the table under the heading "Class B Notes" and on the line across from "Price to public," in the table listing the Class B Underwriters and the Principal Amount of Class B Notes and under the heading "Underwriting" in the Prospectus Supplement, in the table following the third paragraph under the heading "Underwriting" in the Prospectus Supplement in the column labeled "Class B Notes", and in the final paragraph under the heading "Underwriting" in the Prospectus Supplement (the "CLASS B UNDERWRITERS' INFORMATION").
(t) Since the respective dates as of which information is
given in the Registration Statement and the Prospectus, except as
otherwise set forth therein, there has not been any material adverse
change in (i) the condition, financial or otherwise, or in the
earnings, business or operations, of the Bank or the Transferor and
(ii) the financial or statisitcial information contained in the
Prospectus under the caption "The Trust Portfolio."
3. PURCHASE, SALE, PAYMENT AND DELIVERY OF THE OFFERED NOTES.
(a) On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Transferor agrees to sell to the Class A Underwriters, and the Class A Underwriters agree to purchase from the Transferor, at a purchase price of 99.725% of the principal amount thereof, $702,000,000 aggregate principal amount of the Class A Notes, each Class A Underwriter to purchase the amounts shown on SCHEDULE A hereto.
(b) On the basis of the representations, warranties and agreements herein contained, but subject to the terms and conditions herein set forth, the Transferor agrees to sell to the Class B Underwriters, and the Class B Underwriters agree to purchase from the Transferor, at a purchase price of 99.650% of the principal amount thereof, $76,500,000 aggregate principal amount of the Class B Notes, each Class B Underwriter to purchase the amounts shown on SCHEDULE A hereto.
(c) The Transferor will cause the Issuer to deliver the
Offered Notes to the Underwriters against payment of the purchase price
in immediately available funds, drawn to the order of the Transferor,
at the office of Mayer, Brown & Platt, in Chicago, Illinois at 10:00
a.m., Chicago time, on August 21, 2001, or at such other time not later
than seven full business days thereafter as the Representative and the
Transferor determine, such time being herein referred to as the
"CLOSING DATE." Each of the Class A Notes and the Class B Notes so to
be delivered shall be represented by one or more definitive notes
registered in the name of Cede & Co., as nominee for The Depository
Trust Company. The Notes will be available for inspection by the
Underwriters at the office at which the Notes are to be delivered no
later than five hours before the close of business in New York City on
the business day prior to the Closing Date.
4. OFFERING BY UNDERWRITERS. It is understood that after the Effective Date, the Underwriters propose to offer the Offered Notes for sale to the public (which may include selected dealers) as set forth in the Prospectus.
5. CERTAIN AGREEMENTS OF THE TRANSFEROR. The Transferor agrees with the Underwriters that:
(a) Immediately following the execution of this Agreement, the Transferor will prepare a Prospectus Supplement setting forth the amount of Offered Notes covered thereby and the terms thereof not otherwise specified in the Base Prospectus, the price at which such Offered Notes are to be purchased by the Underwriters, the initial public offering price, the selling concessions and allowances, and such other information as the Transferor deems appropriate. The Transferor will transmit the Prospectus, including such Prospectus Supplement, to the Commission pursuant to Rule 424(b) by a means reasonably calculated to result in filing with the Commission pursuant to Rule 424(b). The Transferor will not file any amendment of the Registration Statement with respect to the Offered Notes or supplement to the Prospectus unless a copy has been furnished to the Representative for its review a reasonable time prior to the proposed filing thereof or to which the Representative shall reasonably object in writing. The Transferor will advise the Representative promptly of (i) the effectiveness of any amendment or supplementation of the Registration Statement or Prospectus, (ii) any request by the Commission for any amendment or supplementation of the Registration Statement or the Prospectus or for any additional information, (iii) the receipt by the Transferor of any notification with respect to the suspension of qualification of the Offered Notes for sale in any jurisdiction or the initiation or threatening of any proceeding for such purposes and (iv) the institution by the Commission of any stop order proceeding in respect of the Registration Statement, and will use its best efforts to prevent the issuance of any such stop order and to obtain as soon as possible its lifting, if issued.
(b) If at any time when a prospectus relating to the Offered Notes is required to be delivered under the Act, any event occurs as a result of which the Prospectus, as then amended or supplemented, would include an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if it is necessary at any time to amend the Prospectus to comply with the Act, the Transferor promptly will notify the Representative of such event and prepare and file with the Commission an amendment or supplement which will correct such statement or omission or an amendment which will effect such compliance. Neither the Underwriters' consent to, nor the Underwriters' delivery of, any such amendment or supplement shall constitute a waiver of any of the conditions set forth in Section 6.
(c) As soon as practicable, the Transferor will cause the Trust to make generally available to the Noteholders an earnings statement or statements of the Trust covering a period of at least 12 months beginning after the Effective Date which will satisfy the provisions of Section 11(a) of the Act and Rule 158 of the Commission promulgated thereunder.
(d) The Transferor will furnish to the Representative copies of the Registration Statement (one of which will be signed and will include all exhibits), the Prospectus and all amendments and supplements to such documents, in each case as soon as available and in such quantities as the Representative reasonably requests.
(e) The Transferor will endeavor to qualify the Offered Notes for sale under the securities or Blue Sky laws of such jurisdictions as the Representative shall reasonably request and the determination of the eligibility for investment of the Offered Notes under the laws of such jurisdictions as the Representative may designate and will continue such qualifications in effect so long as required for the distribution of the Offered Notes; PROVIDED, HOWEVER, that the Transferor shall not be obligated to qualify to do business in any jurisdiction where such qualification would subject the Transferor to general or unlimited service of process in any jurisdiction where it is not now so subject.
(f) So long as any Offered Note is outstanding, the
Transferor will furnish, or cause the Servicer to furnish, to the
Representative copies of each certificate and the annual statements of
compliance delivered to (i) the WFNMT Trustee and each Rating Agency
pursuant to Section 3.5 of the PSA and independent certified public
accountant's servicing reports furnished to the WFNMT Trustee, the
Servicer and each Rating Agency pursuant to Sections 3.6(a) and (b) and
(ii) the Owner Trustee, the Indenture Trustee and each Rating Agency
pursuant to Section 3.5 of the TSA and independent certified public
accountant's servicing reports furnished to the Indenture Trustee, the
Servicer and the Rating Agencies pursuant to Sections 3.6(a) and (b) of
the TSA, by first class mail as soon as practicable after such
certificates, statements and reports are furnished to the WFNMT
Trustee, the Owner Trustee, the Indenture Trustee or the Rating
Agencies, as the case may be.
(g) So long as any Offered Note is outstanding, the Transferor will furnish, or cause the Servicer to furnish, to the Representative, by first-class mail as soon as practicable (i) all documents concerning the Receivables, the Collateral Certificate or the Notes distributed by the Transferor or the Servicer (under each of the PSA and TSA) to the WFNMT Trustee, the Owner Trustee, the Indenture Trustee or the Noteholders, or filed
with the Commission pursuant to the Securities Exchange Act of 1934, as amended (the "EXCHANGE ACT"), (ii) any order of the Commission under the Act or the Exchange Act applicable to the Issuer, to WFNMT, or to the Transferor, or pursuant to a "no-action" letter obtained from the staff of the Commission by the Transferor and affecting the Issuer, WFNMT, or the Transferor and (iii) from time to time, such other information concerning the Issuer or WFNMT as the Representative may reasonably request.
(h) Whether or not the transactions contemplated by this Agreement are consummated or this Agreement is terminated for any reason, except a default by the Underwriters hereunder, the Transferor will pay all expenses incident to the performance of its obligations under this Agreement (except as otherwise agreed in writing between the Transferor and the Representative) and will reimburse the Underwriters for any expenses incurred by them in connection with qualification of the Offered Notes for sale and determination of the eligibility of the Offered Notes for investment under the laws of such jurisdictions as the Representative designates and for any fees charged by investment rating agencies for the rating of the Offered Notes and for any filing fee of the National Association of Securities Dealers, Inc. relating to the Offered Notes. The Transferor and the Underwriters will each bear their own respective fees and disbursements of counsel (which in the case of the Transferor will include all legal fees relating to Blue Sky matters).
(i) To the extent, if any, that any of the ratings provided with respect to the Notes by any Rating Agency are conditional upon the furnishing of documents or the taking of any other actions by the Transferor, the Transferor shall furnish such documents and take any such other actions as are reasonably necessary to satisfy such condition.
6. CONDITIONS OF THE OBLIGATIONS OF THE UNDERWRITERS. The obligation of the Underwriters to purchase and pay for the Offered Notes will be subject to the accuracy of the representations and warranties by the Transferor and the Bank herein, to the accuracy of the statements of officers of Transferor and the Bank made pursuant to the provisions hereof, to the performance by the Transferor and the Bank of their respective obligations hereunder and to the following additional conditions precedent:
(a) The Representative shall have received a letter, dated the date of the Prospectus and addressed to the Underwriters, from Deloitte & Touche, confirming that they are independent public accountants within the meaning of the Act and the applicable published Rules and Regulations thereunder, substantially in the form heretofore agreed to and otherwise in form and in substance satisfactory to the Representative and its counsel.
(b) The Prospectus shall have been filed with the Commission in accordance with the Rules and Regulations and Section 5(a) of this Agreement; and, prior to the Closing Date, no stop order suspending the effectiveness of the Registration Statement shall have been issued and no proceedings for that purpose shall have been instituted or, to the knowledge of the Transferor or the Representative, shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery of this Agreement none of the following shall have occurred: (i) any change, or any development involving a prospective change, in or affecting particularly WFNMT, the Issuer, the business or properties of the Transferor or the Bank which, in the judgment of the Underwriters make it impractical or inadvisable to proceed with the completion and sale of and payment for the Offered Notes, (ii) trading in securities generally on the New York Stock Exchange, the American Stock Exchange or the over-the-counter market shall have been suspended, limited or minimum prices shall have been established on either of such exchanges or such market by the Commission, by such exchange or by any other regulatory body or governmental authority having jurisdiction; (iii) a banking moratorium shall have been declared by Federal or state authorities; and (iv) the United States shall have become engaged in hostilities, there shall have been an escalation of hostilities involving the United States or there shall have been a declaration of a national emergency or war by the United States or any other substantial national or international calamity or emergency which, in the judgment of the Underwriters, the effect of such hostilities, escalation, declaration or other calamity or emergency makes it impractical or inadvisable to proceed with the completion and sale of and payment for the Offered Notes.
(d) The Representative shall have received an opinion, dated the Closing Date, of Carolyn Melvin, General Counsel for World Financial Network National Bank, as counsel for the Transferor and the Bank, satisfactory in form and substance to the Representative and its counsel to the effect that:
(i) The Transferor is a limited liability company in good standing, duly organized and validly existing under the laws of the State of Delaware; the Bank is a national banking association in good standing, duly organized and validly existing under the laws of the United States of America; and each of the Transferor and the Bank (each collectively referred to in this subsection 6(d) as a "WFN ENTITY") is duly qualified to do business and is in good standing under the laws of each jurisdiction which requires such qualification wherein it owns or leases material properties or conducts material business, and has full power and authority to own its properties, to conduct its business as described in the Registration Statement and the Prospectus, to enter into and perform its obligations under the Transaction Documents to which it is a party, and to consummate the transactions contemplated thereby.
(ii) Each of the Transaction Documents and this Agreement has been duly authorized, executed and delivered by each WFN Entity that is a party thereto.
(iii) Neither the execution and delivery of the Transaction Documents and this Agreement by either WFN Entity that is party thereto nor the consummation of any of the transactions contemplated therein nor the fulfillment of the terms thereof, conflicts with or violates, results in a material breach of or constitutes a default under (A) any Requirements of Law applicable to such WFN Entity, (B) any term or provision of any order known to me to be currently applicable to such WFN Entity of any court, regulatory body, administrative agency
or governmental body having jurisdiction over such WFN Entity or (C) any term or provision of any indenture or other agreement or instrument known to me to which such WFN Entity is a party or by which either of them or any of their properties are bound.
(iv) Except as otherwise disclosed in the Prospectus (and any supplement thereto) or the Registration Statement, there is no pending or, to the best of my knowledge, threatened action, suit or proceeding before any court or governmental agency, authority or body or any arbitrator with respect to WFNMT, the Issuer, the Collateral Certificate, the Notes or any of the Transaction Documents or any of the transactions contemplated therein with respect to a WFN Entity which, in the case of any such action, suit or proceeding if adversely determined, would have a material adverse effect on the Notes, the Collateral Certificate, WFNMT or the Issuer or upon the ability of any WFN Entity to perform its obligations under the Transaction Documents; and the statements included in the Prospectus describing statutes, legal proceedings, contracts and other documents relating to the WFN Entities, the Accounts, the Receivables, the business of the Bank, the Transferor, WFNMT and the Issuer fairly summarize the matters therein described.
(e) The Representative shall have received an opinion, dated the Closing Date, of Mayer, Brown & Platt, special counsel to the Transferor and the Bank, satisfactory in form and substance to the Representative and its counsel to the effect that:
(i) Each of the Transaction Documents to which
the Transferor or the Bank is a party constitutes the legal,
valid and binding agreement of the Transferor and the Bank, as
the case may be, under the laws of New York, enforceable
against each such Person in accordance with its terms, subject
to (A) the effect of bankruptcy, insolvency, moratorium,
receivership, reorganization, liquidation and other similar
laws affecting creditors' rights generally and the rights of
creditors of national banking associations (including, without
limitation, the determination pursuant to 12 U.S.C.
Section 1821(e) of any liability for the disaffirmance or
repudiation of any contract), (B) the effect of general
principles of equity including (without limitation) concepts
of materiality, reasonableness, good faith, fair dealing
(regardless of whether considered and applied in a proceeding
in equity or at law), and also to the possible unavailability
of specific performance or injunctive relief, and (C) the
unenforceability under certain circumstances of provisions
indemnifying a party against liability or requiring
contribution from a party for liability where such
indemnification or contribution is contrary to public policy.
(ii) This Agreement constitutes the legal, valid and binding obligation of the Transferor and the Bank under the laws of the State of New York, enforceable against the Transferor and the Bank in accordance with its terms, subject to (A) the effect of bankruptcy, insolvency, moratorium, receivership, reorganization, liquidation and other similar laws affecting creditors' rights generally and the rights of creditors of national banking associations (including, without limitation, the
determination pursuant to 12 U.S.C. Section 1821(e) of any liability for the disaffirmance or repudiation of any contract), (B) the effect of general principles of equity including (without limitation) concepts of materiality, reasonableness, good faith, fair dealing (regardless of whether considered and applied in a proceeding in equity or at law), and also to the possible unavailability of specific performance or injunctive relief, and (C) the unenforceability under certain circumstances of provisions indemnifying a party against liability or requiring contribution from a party for liability where such indemnification or contribution is contrary to public policy.
(iii) The Notes are in due and proper form and when executed, authenticated and delivered as specified in the Indenture, and when delivered against payment of the consideration specified in this Agreement and the Class C Note Purchase Agreement they will be validly issued and outstanding, will constitute legal, valid and binding obligations of the Issuer, enforceable against the Issuer in accordance with their terms and will be entitled to the benefits of the Indenture, subject to (A) the effect of bankruptcy, insolvency, moratorium, receivership, reorganization, liquidation and other similar laws affecting creditors' rights generally, (B) the effect of general principles of equity including (without limitation) concepts of materiality, reasonableness, good faith, fair dealing (regardless of whether considered and applied in a proceeding in equity or at law), and also to the possible unavailability of specific performance or injunctive relief, and (C) the unenforceability under certain circumstances of provisions indemnifying a party against liability or requiring contribution from a party for liability where such indemnification or contribution is contrary to public policy.
(iv) The Collateral Certificate is in due and proper form and when executed, authenticated and delivered as specified in the PSA, and when delivered against payment of the consideration specified therein it will be validly issued and outstanding and will be entitled to the benefits of the PSA.
(v) The Registration Statement has become effective under the Act, and the Prospectus has been filed with the Commission pursuant to Rule 424(b) thereunder in the manner and within the time period required by Rule 424(b). To the best of our knowledge, no stop order suspending the effectiveness of the Registration Statement has been issued and no proceedings for that purpose have been instituted or are pending or threatened or contemplated by the Commission, and the Registration Statement and the Prospectus, and each amendment or supplement thereto, as of their respective effective or issue dates, complied as to form in all material respects with the requirements of the Act.
(vi) No approval, authorization, consent, order, registration, filing, qualification, license or permit of or with any court or governmental agency or body is required for the consummation by the Bank, the Transferor, WFNMT or the Issuer of the transactions contemplated in the Transaction Documents, except such as have been obtained under the Act and such as may be required under the blue sky
laws of any jurisdiction inside the United States in connection with the purchase and distribution of the Offered Notes by the Underwriters.
(vii) The statements in the Base Prospectus under the headings "Risk Factors--If a conservator or receiver were appointed for World Financial Network National Bank, delays or reductions in payment of your notes could occur," "Material Legal Aspects of the Receivables," "ERISA Considerations" and "Federal Income Tax Consequences" and the statements in the Prospectus Supplement under the headings "Structural Summary--Tax Status" and "--ERISA Considerations" to the extent that they constitute matters of law or legal conclusions with respect thereto, have been reviewed by us and are correct in all material respects.
(viii) This Agreement, the Program Documents, the Collateral Certificate and the Notes conform in all material respects to the descriptions thereof contained in the Prospectus.
(ix) The Indenture has been duly qualified under the TIA and complies as to form with the TIA and the rules and regulations of the Commission thereunder. The Issuer is not now, and immediately following the issuance of the Notes pursuant to the Indenture will not be, required to be registered under the Investment Company Act of 1940, as amended.
(x) The PSA need not be qualified under the TIA. WFNMT is not now, and immediately following the issuance of the Collateral Certificate pursuant to the PSA will not be, required to be registered under the Investment Company Act of 1940, as amended.
(xi) Subject to the discussion in the Base Prospectus under the heading "Federal Income Tax Consequences," (A) the Notes will properly be characterized as indebtedness and neither WFNMT nor the Issuer will be treated as an association (or publicly traded partnership) taxable as a corporation, for U.S. federal income tax purposes and (B) the issuance of the Notes will not cause or constitute and event in which gain or loss would be recognized by any holder of Notes or Investor Certificates of any outstanding series or class, for U.S. federal income tax purposes.
(xii) For Texas corporate franchise tax purposes, neither WFNMT nor the Issuer will be treated as an entity subject to tax and Noteholders not otherwise subject to Texas corporate franchise tax will not become subject to the Texas corporate franchise tax by reason of their ownership of the Notes, together with such other opinions related thereto as the Representative reasonably requests.
(xiii) The Indenture constitutes the legal, valid and binding obligation of the Issuer under the laws of the State of New York, subject to (A) the effect of bankruptcy, insolvency, moratorium, receivership, reorganization, liquidation and other similar laws affecting creditors' rights generally, (B) the effect of general
principles of equity including (without limitation) concepts of materiality, reasonableness, good faith, fair dealing (regardless of whether considered and applied in a proceeding in equity or at law), and also to the possible unavailability of specific performance or injunctive relief, and (C) the unenforceability under certain circumstances of provisions indemnifying a party against liability or requiring contribution from a party for liability where such indemnification or contribution is contrary to public policy.
(xiv) Each of the Registration Statement, as of its effective date, and the Prospectus, as of its date, complied as to form in all material respects with the requirements of the Act and the Rules and Regulations under the Act, except that in each case such counsel need not express any opinion as to the financial and statistical data included therein or excluded therefrom or the exhibits to the Registration Statement and, except as and to the extent set forth in paragraphs (vii) and (viii), such counsel does not assume any responsibility for the accuracy, completeness or fairness of the statements contained in the Registration Statement or the Prospectus.
(xv) If the FDIC were appointed as conservator or receiver for the Bank (a) the FDIC regulation entitled "Treatment by the Federal Deposit Insurance Corporation as Conservator or Receiver of Financial Assets Transferred by an Insured Depository Institution in Connection with a Securitization or Participation," 12 CFR Section 360.6 (the "RULE")would be applicable to the transfers of Receivables by the Bank to the Transferor under the Receivables Purchase Agreement, (b) under the Rule, the FDIC could not, by exercise of its authority to disaffirm or repudiate contracts under 12 U.S.C. Section 1821(e), reclaim or recover the Receivables or the proceeds thereof from Transferor or the Trust or recharacterize the Receivables or the proceeds thereof as property of the Bank or of the conservatorship or receivership for the Bank, (c) neither the FDIC (acting for itself as a creditor or as representative of the Bank or its shareholders or creditors) nor any creditor of the Bank would have the right, under any bankruptcy or insolvency law applicable in the conservatorship or receivership of the Bank, to avoid the transfers of Receivables by the Bank to the Transferor under the Receivables Purchase Agreement, to recover the Receivables, or to require the Receivables to be turned over to the FDIC or such creditor (including by way of any order consolidating the assets and liabilities of the Transferor with those of the Bank) and (d) there is no other power exercisable by the FDIC as conservator or receiver for the Bank that would permit the FDIC as such conservator or receiver to reclaim or recover the Receivables from the Transferor or WFNMT or to recharacterize the Receivables as property of the Bank or of the conservatorship or receivership for the Bank; provided, however, that such counsel need not offer any opinion as to whether, in receivership, the FDIC or any creditor of the Bank may reclaim or recover the Receivables from the Transferor or WFNMT, or recharacterize the Receivables as property of the Bank or of the conservatorship or receivership for the Bank, if the Noteholders receive payment of the principal amount of their Notes and the interest earned thereon (at the interest
rates specified in respect of such Notes) through the date the Noteholders are so paid.
(xvi) If the FDIC were to be appointed as a
conservator or receiver for the Bank a court having
jurisdiction over the conservatorship or receivership would
(a) hold the transfers of Receivables by the Bank to the
Transferor under the Receivables Purchase Agreement to be a
true conveyance and not a secured loan or a grant of a
security interest to secure a loan and (b) determine that the
rights, titles, powers, and privileges of the FDIC as
conservator or receiver of the Bank would not extend to the
Receivables.
(xvii) Certain matters relating to the transfer of the Receivables from the Bank to the Transferor under the Receivables Purchase Agreement and from the Bank to WFNMT under the PSA, as applicable, together with such other opinions related thereto as the Representative reasonably requests.
(xviii) Certain matters relating to the transfer of the Receivables from the Transferor to WFNMT under the PSA.
(xix) Certain matters relating to the transfer of the Collateral Certificate from the Transferor to the Issuer under the TSA.
(xx) The perfection of the security interest in favor of the Issuer in the Collateral Certificate and the proceeds thereof.
(xxi) When the Indenture Trustee has taken possession of the Collateral Certificate issued by WFNMT, the Program Documents have been executed and delivered and WFNMT has received payment for the Collateral Certificate, the Indenture Trustee will become the registered holder of the Collateral Certificate, subject to no Liens of record, together with such other opinions related thereto as the Representative reasonably requests.
Such counsel also shall state that they have participated in conferences with representatives of the Transferor and the Bank and their accountants, the Underwriters and counsel to the Underwriters concerning the Registration Statement and the Prospectus and have considered the matters to be stated therein and the matters stated therein, although they are not independently verifying the accuracy, completeness or fairness of such statements (except as stated in paragraph (vii) above) and based upon and subject to the foregoing, nothing has come to such counsel's attention to cause such counsel to believe that the Registration Statement (excluding any exhibits filed therewith), at the time it became effective, contained any untrue statement of a material fact or omitted to state any material fact required to be stated therein or necessary to make the statements therein not misleading, or that the Prospectus, as of the date hereof, contains any untrue statement of a material fact or omits to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not
misleading (it being understood that such counsel has not been requested to, and does not, make any comment in such opinion with respect to the financial statements, supporting schedules and other financial or statistical information contained in the Registration Statement or the Prospectus).
In rendering such opinion, counsel may rely (A) as to matters involving the application of laws of any jurisdiction other than the State of New York and the United States, to the extent deemed proper and stated in such opinion, upon the opinion of other counsel of good standing believed by such counsel to be reliable and acceptable to the Representative and its counsel, and (B) as to matters of fact, to the extent deemed proper and as stated therein, on certificates of responsible officers of the Issuer, the Bank, the Transferor and public officials.
(f) The Representative shall have received from Orrick, Herrington & Sutcliffe LLP, special counsel for the Underwriters, such opinion or opinions, dated the Closing Date, with respect to such matters relating to this transaction as the Representative may require, and the Transferor shall have furnished to such counsel such documents as they request for the purpose of enabling them to pass upon such matters.
(g) The Representative shall have received an opinion, dated the Closing Date, of Arter & Hadden, special Ohio counsel for the Transferor and the Bank, satisfactory in form and substance to the Representative and its counsel with respect to (i) certain matters relating to the transfer of the Receivables from the Bank to the Transferor under the Receivables Purchase Agreement and from the Bank to WFNMT under the PSA, as applicable, (ii) the perfection of the security interest in favor of the Transferor and WFNMT, as applicable, in the Receivables and the proceeds thereof and (iii) for Ohio corporate franchise tax purposes or the Ohio dealers intangibles tax, neither WFNMT nor the Issuer will be treated as an entity subject to tax, and (iv) Noteholders not otherwise subject to Ohio corporate franchise tax or Ohio personal income tax will not become subject to the Ohio corporate franchise tax or Ohio personal income tax by reason of their ownership of the Notes.
(h) The Representative shall have received an opinion, dated the Closing Date, of Richards, Layton & Finger, P.A., special Delaware counsel for the Transferor and the Bank, satisfactory in form and substance to the Representative and its counsel with respect to (i) the perfection of the security interest in favor of WFNMT in the Receivables and the proceeds thereof transferred to WFNMT from the Transferor under the PSA, (ii) the perfection of the security interest in favor of the Issuer in the Collateral Certificate and the proceeds thereof and (iii) the perfection of the security interest in favor of the Indenture Trustee in the Collateral Certificate and the proceeds thereof.
(i) The Representative shall have received a certificate from each of the Transferor and the Bank, dated the Closing Date, of a Treasurer, Vice President or more senior officer of the Transferor or the Bank, as the case may be, in which such officer, to the best of his/her knowledge after reasonable investigation, shall state that (u) the
representations and warranties of the Transferor and the Bank, as the
case may be, in this Agreement are true and correct on and as of the
Closing Date, (v) the Transferor or the Bank, as the case may be, has
complied with all agreements and satisfied all conditions on its part
to be performed or satisfied hereunder at or prior to the Closing Date,
(w) the representations and warranties of the Transferor or the Bank,
as the case may be, contained in this Agreement and the Transaction
Documents to which it is a party are true and correct as of the dates
specified herein and therein, (x) no stop order suspending the
effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are threatened by
the Commission, (y) nothing has come to such officers' attention that
would lead such officers to believe that the Registration Statement or
the Prospectus, and any amendment or supplement thereto, as of its date
and as of the Closing Date, contained an untrue statement of a material
fact or omitted to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which
they were made, not misleading, and (z) subsequent to the date of the
Prospectus, there has been no material adverse change in the financial
position or results of operation of the Bank's credit card business
except as set forth in or contemplated by the Prospectus or as
described in such certificate.
(j) The Representative shall have received an opinion of Richards, Layton & Finger, P.A., counsel to the Owner Trustee, dated the Closing Date, satisfactory in form and substance to the Representative and its counsel, to the effect that:
(i) Chase is duly incorporated and validly existing as a national banking association in good standing under the laws of the United States of America and has the power and authority to execute, deliver and perform the Trust Agreement and to consummate the transactions contemplated thereby, and, on behalf of the Issuer, to execute and deliver the Indenture and the TSA (the Indenture and the TSA collectively referred to in this subsection 6(j) as the "TRUST DOCUMENTS") and to consummate the transactions contemplated thereby.
(ii) The Trust Agreement has been duly authorized, executed and delivered by Chase and constitutes a legal, valid and binding obligation of Chase, enforceable against Chase in accordance with its terms.
(iii) The Trust Documents have been duly authorized, executed and delivered by the Owner Trustee on behalf of the Issuer.
(iv) Neither the execution, delivery or performance by Chase of the Trust Agreement or, as Owner Trustee on behalf of the Issuer, of the Trust Documents, nor the consummation of any of the transactions by Chase or the Owner Trustee, as the case may be, contemplated thereby, requires the consent or approval of, the withholding of objection on the part of, the giving of notice to, the filing, registration or qualification with, or the taking of any other action in respect of, any governmental authority or agency of the State of Delaware or the United States of America governing the banking or trust powers of Chase.
(v) Neither the execution, delivery and performance by Chase of the Trust Agreement or, as Owner Trustee on behalf of the Issuer, of the Trust Documents, nor the consummation of any of the transactions by Chase or the Owner Trustee, as the case may be, contemplated thereby, is in violation of the articles of association or bylaws of Chase or of any law, governmental rule or regulation of the State of Delaware or of the United States of America governing the banking or trust powers of Chase or, to such counsel's knowledge, without independent investigation, any indenture, mortgage, bank credit agreement, note or bond purchase agreement, long-term lease, license or other agreement or instrument to which it is a party or by which it is bound or, to such counsel's knowledge, without independent investigation, or any judgment or order applicable to Chase.
(vi) No consent, approval or other authorization of, or registration, declaration or filing with, any court or governmental agency or commission of the State of Delaware is required by or with respect to Chase, in its individual capacity or as Owner Trustee, as the case may be, for the valid execution and delivery of the Trust Agreement or, as Owner Trustee on behalf of the Issuer, of the Trust Documents, or for the validity or enforceability thereof (other than the filing of the certificate of trust, which certificate of trust has been duly filed).
(vii) To such counsel's knowledge, without independent investigation, there are no pending or threatened actions, suits or proceedings affecting the Owner Trustee before any court or other governmental authority which, if adversely determined, would materially and adversely affect the ability of the Owner Trustee to carry out the transactions contemplated by the Trust Agreement.
(k) The Representative shall have received an opinion of Richards, Layton & Finger, special Delaware counsel to the Issuer, dated the Closing Date, satisfactory in form and substance to the Representative and its counsel, to the effect that:
(i) The Issuer has been duly formed and is validly existing in good standing as a business trust under the Delaware Business Trust Act, 12 DEL. C. 3801 ET SEQ. (referred to in this subsection 6(k) as the "TRUST ACT").
(ii) The Trust Agreement is a legal, valid and binding obligation of the Transferor and the Owner Trustee, enforceable against the Transferor and the Owner Trustee, in accordance with its terms.
(iii) Under the Trust Act and the Trust Agreement, the execution and delivery of the TSA and the Indenture (the TSA and the Indenture collectively referred to in this subsection 6(k) as the "TRUST DOCUMENTS"), the issuance of the Notes, and the granting of the Collateral to the Indenture Trustee as security for the Notes has been duly authorized by all necessary trust action on the part of the Issuer.
(iv) Under the Trust Act and the Trust Agreement, the Issuer has (i) the trust power and authority to execute, deliver and perform its obligations under the Trust Documents and the Notes, and (ii) duly authorized, executed and delivered such agreements and obligations.
(v) The Transferor Interest is entitled to the benefits of the Trust Agreement.
(vi) Neither the execution, delivery and performance by the Issuer of the Trust Documents or the Notes, nor the consummation by the Issuer of any of the transactions by the Issuer contemplated thereby, requires the consent or approval of, the withholding of objection on the part of, the giving of notice to, the filing, registration or qualification with, or the taking of any other action in respect of, any governmental authority or agency of the State of Delaware, other than the filing of the Certificate of Trust with the Delaware Secretary of State (which Certificate of Trust has been duly filed) and the filing of any UCC financing statements with the Delaware Secretary of State pursuant to the Indenture.
(vii) Neither the execution, delivery and performance by the Issuer of the Trust Documents, nor the consummation by the Issuer of the transactions contemplated thereby, is in violation of the Trust Agreement or of any law, rule, or regulation of the State of Delaware applicable to the Issuer.
(viii) Under Section 3805(b) of the Act, no creditor of the holder of the beneficial interest in the Trust shall have any right to obtain possession of, or otherwise exercise legal or equitable remedies with respect to, the property of the Issuer except in accordance with the terms of the Trust Agreement.
(ix) Under Sections 3808(a) and (b) of the Act, the Issuer may not be terminated or revoked by the holder of the beneficial interest in the Trust, and the dissolution, termination or bankruptcy of the holder of the beneficial interest in the Trust shall not result in the termination or dissolution of the Issuer, except to the extent otherwise provided in the Trust Agreement.
(x) The Owner Trustee is not required to hold legal title to the Trust Estate in order for the Issuer to qualify as a business trust under the Act.
(xi) With respect to the Issuer and the Receivables: (a) there is no document, stamp, excise or other similar tax imposed by the State of Delaware upon the perfection of a security interest in the Collateral Certificate or the Receivables, in the transfer of Collateral Certificate or the Receivables to or from the Issuer or the WFNMT or upon the issuance of Collateral Certificate or the Notes; (b) there is no personal property tax imposed by the State of Delaware upon or measured by the corpus of the Issuer or the WFNMT; (c) the characterization of the Issuer and the WFNMT for federal income tax purposes will be determinative of the
characterization of the Issuer and the WFNMT for Delaware income tax purposes and assuming that the Issuer and the WFNMT will not be taxed as associations or as publicly traded partnerships for federal income tax purposes, neither of the Issuer nor the WFNMT will be subject to Delaware income tax and Noteholders who are not otherwise subject to Delaware income tax will not be subject to tax by reason of their ownership of the Notes and the receipt of income therefrom; and (d) any income tax imposed by the State of Delaware that might be applicable to the Issuer would be based upon "federal taxable income," and for the purposes of determining such income, the characterization of such income for federal income tax purpose will be determinative, whether the characterization of the transaction is that of a sale or a loan.
(xii) The Transferor is the sole beneficial owner of the Issuer.
(l) The Representative shall have received an opinion of Emmet, Marvin & Martin, counsel to the Indenture Trustee dated the Closing Date, satisfactory in form and substance to the Representative and its counsel, to the effect that:
(i) The Indenture Trustee is organized and validly existing as an Illinois banking corporation in good standing under the laws of the State of Illinois and is authorized and qualified to accept the trusts imposed by the Indenture and to act as Indenture Trustee under the Indenture.
(ii) The acknowledgment by the Indenture Trustee of the TSA has been duly authorized, executed and delivered by the Indenture Trustee. The Indenture Trustee has duly authorized, executed and delivered the Indenture. Assuming the due authorization, execution and delivery thereof by the other parties thereto, the Indenture is the legal, valid and binding obligation of the Indenture Trustee, enforceable against the Indenture Trustee in accordance with its terms, subject to bankruptcy and insolvency laws and general principles of equity.
(iii) The Indenture Trustee has duly executed and authenticated the Notes.
(iv) The Indenture Trustee is duly authorized and empowered to exercise trust powers under applicable law.
(v) None of (x) the execution and authentication of the Notes, (y) the acknowledgment of the TSA or (z) the execution, delivery and performance of the Indenture by the Indenture Trustee conflicts with or will result in a violation of (A) any law or regulation of the United States of America or the States of Illinois governing the banking or trust powers of the Indenture Trustee or (B) the Organization Certificate or Bylaws of the Indenture Trustee.
(vi) No approval, authorization or other action by, or filing with, any governmental authority of the United States of America or the State of Illinois having jurisdiction over the banking or trust powers of the Indenture Trustee is required in connection with the execution and delivery by the Indenture Trustee of the Indenture or the performance by the Indenture Trustee of the terms of the Indenture or the acknowledgment of the TSA.
(m) The Representative shall have received an opinion of Emmet, Marvin & Martin, counsel to the WFNMT Trustee dated the Closing Date, satisfactory in form and substance to the Representative and its counsel, to the effect that:
(i) The WFNMT Trustee is organized and validly existing as an Illinois banking corporation in good standing under the laws of the State of Illinois and is authorized and qualified to accept the trusts imposed by the PSA and to act as WFNMT Trustee under the PSA.
(ii) The WFNMT Trustee has duly authorized, executed and delivered the PSA. Assuming the due authorization, execution and delivery thereof by the other parties thereto, the PSA is the legal, valid and binding obligation of the WFNMT Trustee, enforceable against the WFNMT Trustee in accordance with its terms, subject to bankruptcy and insolvency laws and general principles of equity.
(iii) The WFNMT Trustee has duly executed and authenticated the Collateral Certificate.
(iv) The WFNMT Trustee is duly authorized and empowered to exercise trust powers under applicable law.
(v) None of (y) the execution and authentication of the Collateral Certificate, and (z) the execution, delivery and performance of the PSA by the WFNMT Trustee conflicts with or will result in a violation of (A) any law or regulation of the United States of America or the States of Illinois governing the banking or trust powers of the WFNMT Trustee or (B) the Organization Certificate or Bylaws of the WFNMT Trustee.
(vi) No approval, authorization or other action by, or filing with, any governmental authority of the United States of America or the State of Illinois having jurisdiction over the banking or trust powers of the WFNMT Trustee is required in connection with the execution and delivery by the WFNMT Trustee of the PSA or the performance by the WFNMT Trustee of the terms of the PSA.
(n) The Representative shall have received reliance letters addressed to the Representative, dated as of the Closing Date, allowing the Representative to rely on each opinion of counsel delivered to a Rating Agency, the Indenture Trustee, the Transferor or the Bank in connection with the issuance of the Notes.
(o) The Representative shall have received an opinion of
Spencer, Fane, Britt & Browne, special Kansas counsel to the Issuer,
dated the Closing Date, satisfactory in form and substance to the
Representative and its counsel, to the effect that (i) if WFNMT or the
Issuer were determined to be a foreign corporation or a foreign
business trust, it would be subject to an annual Kansas franchise tax
up to a maximum of $2,500 per year, but only if it either (A) qualifies
or registers to do business in the State of Kansas or (B) transacts
business in the State of Kansas and if WFNMT or the Issuer were
determined not to be one of these entitites, it will not be subject to
Kansas franchise tax; (ii) for Kansas income tax purposes, neither
WFNMT nor the Issuer will be treated as an entity subject to tax; and
(iii) Noteholders not otherwise subject to Kansas income tax or Kansas
franchise tax will not become subject to the Kansas income tax or
Kansas franchise tax by reason of their ownership of the Notes,
together with such other opinions related thereto as the Representative
reasonably requests.
(p) The Representative shall have received an opinion of Senn, Lewis & Visciano, special Colorado counsel to the Issuer, dated the Closing Date, satisfactory in form and substance to the Representative and its counsel, to the effect that (i) for Colorado income tax purposes, neither WFNMT nor the Issuer will be treated as an entity subject to tax and (ii) Noteholders, not otherwise subject to Colorado income tax, will not become subject to the Colorado income tax by reason of their ownership of the Notes, together with such other opinions related thereto as the Representative reasonably requests.
(q) The Representative shall have received an opinion of
Cozen and O'Connor, special New Jersey counsel to the Issuer, dated the
Closing Date, satisfactory in form and substance to the Representative
and its counsel, to the effect that (i) for New Jersey corporation
business tax purposes or New Jersey gross income tax purposes, neither
WFNMT nor the Issuer will be treated as an entity subject to tax and
(ii) Noteholders, not otherwise subject to New Jersey corporation
business tax, New Jersey gross income tax or New Jersey personal income
tax, will not become subject to the New Jersey corporation business
tax, New Jersey gross income tax or New Jersey personal income tax by
reason of their ownership of the Notes, together with such other
opinions related thereto as the Representative reasonably requests.
(r) The Representative shall have received evidence satisfactory to the Representative that the Class A Notes shall be rated "Aaa" by Moody's Investors Service, Inc. ("MOODY'S"), "AAA" by Standard & Poor's Ratings Services ("STANDARD & POOR'S") and "AAA" by Fitch, Inc. ("FITCH"), that the Class B Notes shall be rated no lower than "A1" by Moody's, "A" by Standard & Poor's and "A+" by Fitch, and that the Class C Notes shall be rated no lower than "Baa2" by Moody's, "BBB" by Standard & Poor's and "Baa3" by Fitch.
The Transferor will furnish the Representative with such conformed copies of such opinions, certificates, letters and documents as the Representative reasonably request.
7. INDEMNIFICATION AND CONTRIBUTION.
(a) The Transferor and the Bank, jointly and severally,
will indemnify and hold harmless each Underwriter and each Person who
controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the 1934 Act from and against any losses, claims, damages
or liabilities, joint or several, to which the Underwriters or any of
them may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof)
arise out of or are based upon any untrue statement or alleged untrue
statement of any material fact contained in the Registration Statement,
the Prospectus or any amendment or supplement thereto, or any related
preliminary prospectus, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not
misleading, and will reimburse each Underwriter and each Person who
controls any Underwriter within the meaning of Section 15 of the Act or
Section 20 of the 1934 Act for any actual legal or other expenses
reasonably incurred by the Underwriter in connection with investigating
or defending any such loss, claim, damage, liability or action as such
expenses are incurred; PROVIDED, HOWEVER, that Transferor and the Bank
will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon an untrue
statement or alleged untrue statement in or omission or alleged
omission from any of such documents in reliance upon and in conformity
with the Class A Underwriters' Information or the Class B Underwriters'
Information; PROVIDED FURTHER, that the Transferor and the Bank will
not be liable to any Underwriter under the indemnity agreement in this
subsection (a) with respect to any preliminary prospectus to the extent
that any loss, claim, damage or liability of such Underwriter results
from the fact that such Underwriter sold Offered Notes to a Person as
to whom it is established that there was not sent or given, at or prior
to written confirmation of such sale, a copy of the Prospectus
(excluding documents incorporated by reference) or of the Prospectus as
then amended or supplemented (excluding documents incorporated by
reference) in any case where such delivery is required by the Act if
the Transferor or the Bank notified the Representative in writing in
accordance with Section 5(a) hereof and previously furnished copies of
the Prospectus (excluding documents incorporated by reference) in the
quantity requested in accordance with Section 5(d) hereof to such
Underwriter and the loss, claim, damage or liability of such
Underwriter results from an untrue statement or omission of a material
fact contained in the preliminary prospectus and corrected in the
Prospectus or the Prospectus as then amended or supplemented.
(b) Each Underwriter, severally and not jointly, agrees
to indemnify and hold harmless the Transferor and the Bank, and each of
their respective directors and officers and each Person who controls
the Transferor and the Bank, respectively, within the meaning of
Section 15 of the Act or Section 20 of the 1934 Act, against any
losses, claims, damages or liabilities to which the Transferor or the
Bank, as the case may be, may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in
the Registration Statement, the Prospectus or any amendment or
supplement thereto, or any related preliminary prospectus, or arise out
of or are based upon the omission or the alleged omission to state
therein a material fact required
to be stated therein or necessary to make the statements therein not misleading, in each case to the extent, but only to the extent, that, with respect to each of the Class A Underwriters and the Class B Underwriters, such untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with the Class A Underwriters' Information or the Class B Underwriters' Information, respectively, and will reimburse any actual legal or other expenses reasonably incurred by the Transferor and the Bank in connection with investigating or defending any such loss, claim, damage, liability or action as such expenses are incurred.
(c) Promptly after receipt by an indemnified party under this section of notice of the commencement of any action or the assertion by a third party of a claim, such indemnified party will, if a claim in respect thereof is to be made against the indemnifying party under subsection (a) or (b) above, notify the indemnifying party in writing of the commencement thereof; but the omission so to notify the indemnifying party will not relieve it from any liability which it may have to any indemnified party except and to the extent of any prejudice to such indemnifying party arising from such failure to provide such notice. In case any such action is brought against any indemnified party and it notifies the indemnifying party of the commencement thereof, the indemnifying party will be entitled to participate therein and, to the extent that it may wish, jointly with any other indemnifying party similarly notified, to assume the defense thereof, with counsel reasonably satisfactory to such indemnified party (who shall not, except with the consent of the indemnified party, be counsel to the indemnifying party), and after notice from the indemnifying party to such indemnified party of its election so to assume the defense thereof, the indemnifying party will not be liable to such indemnified party under this section for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation. No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened action in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party unless such settlement includes an unconditional release of such indemnified party from all liability on any claims that are the subject matter of such action and does not include a statement as to, or an admission of, fault, culpability or failure to act by or on behalf of any indemnified party.
(d) If the indemnification provided for in this section is unavailable or insufficient to hold harmless an indemnified party under subsection (a) or (b) above, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of the losses, claims, damages or liabilities referred to in subsection (a) or (b) above (i) in such proportion as is appropriate to reflect the relative benefits received by the Transferor and the Bank on the one hand and the Underwriters on the other from the offering of the Offered Notes, or (ii) if the allocation provided by clause (i) above is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of the Transferor and the Bank on the one hand and the Underwriters on the other in connection with the statements or omissions which resulted in such losses, claims, damages or liabilities as well as any other relevant equitable considerations. The relative benefits received by the Transferor
and the Bank on the one hand and the Underwriters on the other shall be deemed to be in the same proportion as the total net proceeds from the offering (before deducting expenses) of the Offered Notes received by the Transferor bear to the total underwriting discounts and commissions received by the Underwriters with respect to the Offered Notes. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Transferor and the Bank or the Underwriters and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission with respect to the Offered Notes. The amount paid by an indemnified party as a result of the losses, claims, damages or liabilities referred to in the first sentence of this subsection (d) shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any action or claim which is the subject of this subsection (d). Notwithstanding the provisions of this subsection (d), the Underwriters shall not be required to contribute any amount in excess of the amount by which the total underwriting discount as set forth on the cover page of the Prospectus Supplement exceeds the amount of damages which the Underwriters have otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission with respect to the Offered Notes. No Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation.
(e) The obligations of the Transferor and the Bank under this Section shall be in addition to any liability which the Transferor or the Bank may otherwise have and shall extend, upon the same terms and conditions, to each Person, if any, who controls any Underwriter within the meaning of the Act; and the obligations of any Underwriter under this Section shall be in addition to any liability that such Underwriter may otherwise have and shall extend, upon the same terms and conditions, to each director of the Transferor or the Bank, to each officer of the Transferor who has signed the Registration Statement and to each Person, if any, who controls the Transferor or the Bank within the meaning of the Act.
8. SURVIVAL OF CERTAIN REPRESENTATIONS AND OBLIGATIONS. The respective indemnities, agreements, representations, warranties and other statements of the Transferor and the Bank or their officers and of the Underwriters set forth in or made pursuant to this Agreement will remain in full force and effect, regardless of any investigation, or statement as to the results thereof, made by or on behalf of the Underwriters, the Transferor, the Bank or any of their respective representatives, officers or directors or any controlling person, and will survive delivery of and payment for the Notes. If this Agreement is terminated or if for any reason other than default by the Underwriters the purchase of the Offered Notes by the Underwriters is not consummated, the Transferor and the Bank shall remain responsible for the expenses to be paid by them pursuant to Section 5 and the respective obligations of the Transferor, the Bank and the Underwriters pursuant to Section 7 shall remain in effect. If for any reason the purchase of the Offered Notes by the Underwriters is not consummated other than solely because of the occurrence of any event specified in clause (ii), (iii) or (iv) of Section 6(c), the Transferor and the Bank will reimburse the Underwriters for all out-of-pocket expenses reasonably incurred by them in connection with the offering of the Offered Notes.
9. COMPUTATIONAL MATERIALS AND ABS TERM SHEETS.
(a) Each Underwriter, severally, represents and warrants to the Transferor and the Bank that it has not and will not use any information that constitutes "COMPUTATIONAL MATERIALS," as defined in the Commission's No-Action Letter, dated May 20, 1994, addressed to Kidder, Peabody Acceptance Corporation I, Kidder, Peabody & Co. Incorporated and Kidder Structured Asset Corporation (as made generally applicable to registrants, issuers and underwriters by the Commission's response to the request of the Public Securities Association dated May 27, 1994), with respect of the offering of the Offered Notes.
(b) Each Underwriter, severally, represents and warrants to the Transferor and the Bank that it has not and will not use any information that constitutes "ABS TERM SHEETS," as defined in the Commission's No-Action Letter, dated February 17, 1995, addressed to the Public Securities Association, with respect to the offering of the Offered Notes.
10. OBLIGATIONS OF THE UNDERWRITERS.
(a) Each Underwriter represents and agrees that it has not and will not, directly or indirectly, offer, sell or deliver any of the Offered Notes or distribute the Prospectus or any other offering materials relating to the Offered Notes in or from any jurisdiction except under circumstances that will, to the best of its knowledge and belief, result in compliance with any applicable laws and regulations thereof and that, to the best of its knowledge and belief, will not impose any obligations on the Transferor, the Bank or the Issuer except as set forth herein.
(b) Each Underwriter further represents and agrees that it will not, in connection with the initial distribution of the Offered Notes, transfer, deposit or otherwise convey any Offered Notes into a trust or other type of special purpose vehicle that issues securities or other instruments backed in whole or in part by, or that represents interests in, such Offered Notes unless either (i) the Offered Notes so transferred, together with any other securities issued by the Transferor, the Bank, any of their affiliates or any trust to which the Transferor or the Bank transfers receivables, make up less than 10% of the assets of such special purpose vehicle or (ii) the Bank gives its prior written consent to such conveyance, which consent shall not be unreasonably withheld.
11. DEFAULT BY AN UNDERWRITER. If any one or more Underwriters shall fail to purchase and pay for any of the Offered Notes agreed to be purchased by such Underwriter or Underwriters hereunder and such failure to purchase shall constitute a default in the performance of its or their obligations under this Agreement, the remaining Underwriters shall be obligated severally to take up and pay for (in the respective proportions which the amount of Offered Notes set forth opposite their names in Schedule A hereto bear to the aggregate amount of Offered Notes set forth opposite the names of all the remaining Underwriters) the Offered Notes which the defaulting Underwriter or Underwriters agreed but failed to purchase; PROVIDED, HOWEVER, that in the event that the aggregate amount of Offered Notes which the defaulting Underwriter or Underwriters agreed but failed to
purchase shall exceed 10% of the aggregate amount of Offered Notes set forth in Schedule A hereto, the remaining Underwriters shall have the right to purchase all, but shall not be under any obligation to purchase any, of the Offered Notes, and if such nondefaulting Underwriters do not purchase all the Offered Notes, this Agreement will terminate without liability to any nondefaulting Underwriter, the Transferor or the Bank. In the event of a default by any Underwriter as set forth in this Section 11, the Closing Date shall be postponed for such period, not exceeding seven days, as the Representative shall determine in order that the required changes in the Registration Statement and Prospectus or in any other documents or arrangements may be effected. Nothing contained in this Agreement shall relieve any defaulting Underwriter for its liability, if any, to the Transferor and the Bank and any nondefaulting Underwriter for damages occasioned by its default hereunder.
12. NOTICES. All communications hereunder will be in writing and, if sent to the Underwriters, will be mailed, delivered or telegraphed and confirmed to:
J.P. Morgan Securities Inc. 270 Park Avenue New York, New York 10017 Attention: Anthony Coniglio
13. COUNTERPARTS. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all such counterparts shall together constitute one and the same Agreement.
14. APPLICABLE LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND 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.
15. FINANCIAL SERVICES ACT. Each Underwriter represents and warrants to, and agrees with, the Transferor and the Bank that (w) it has complied and shall comply with all applicable provisions of the Financial Services Act 1986 and the Public Offers of Securities Regulations 1995 (the "REGULATIONS") with respect to anything done by it in relation to the Offered Notes in, from or otherwise involving the United Kingdom; (x) it has only issued or passed on and shall only issue or pass on in the United Kingdom any document received by it in connection with the issue of the Offered Notes to a Person who is of a kind described in Article 11(3) of the Financial Services Act 1986 (Investment Advertisements) (Exemptions) Order 1996 or who is a Person to whom the document may otherwise lawfully be issued or passed on; (y) it has not offered or sold and, during the period of six months from the date hereof, will not offer or sell any Offered Note to Persons in the United Kingdom except to Persons whose ordinary activities involve them in acquiring, holding, managing, or disposing of investments (as principal or agent) for the purposes of their businesses or otherwise in circumstances which have not resulted and will not result in an offer to the public in the United Kingdom within the meaning of the Regulations.
16. REPRESENTATIVE. The representative will act for the several Underwriters in connection with this Agreement and the transactions contemplated hereby and any action undertaken under this Agreement taken by the Representatives will be binding upon the Underwriters.
If you are in agreement with the foregoing, please sign two counterparts hereof and return one to the Transferor whereupon this letter and your acceptance shall become a binding agreement among the Transferor, the Bank and the Underwriters.
Very truly yours,
WFN CREDIT COMPANY, LLC
By /s/ Robert P. Armiak ----------------------------------------- Name: Robert P. Armiak Title:Vice President and Treasurer |
WORLD FINANCIAL NETWORK NATIONAL BANK
By /s/ Robert P. Armiak ----------------------------------------- Name: Robert P. Armiak Title: Vice President and Treasurer |
The foregoing Agreement is
hereby confirmed and accepted
as of the date hereof
J.P. MORGAN SECURITIES INC.
as Representative of the
Underwriters set forth herein
By /s/ Anthony Coniglio
------------------------------------
Name: Amthony Coniglio
Title: Vice President
|
SCHEDULE A
CLASS A NOTES
Underwriters Principal Amount of
------------ Class A Notes
-------------------
J.P. Morgan Securities Inc. $ 141,000,000
Banc One Capital Markets, Inc. 141,000,000
Barclays Capital Inc. 140,000,000
Credit Suisse First Boston Corporation 140,000,000
First Union Securities, Inc. 140,000,000
-------------
Total $ 702,000,000
=============
|
CLASS B NOTES
Underwriters Principal Amount of
------------ Class B Notes
-------------------
J.P. Morgan Securities Inc. $ 38,250,000
Banc One Capital Markets, Inc. $ 38,250,000
------------
Total $ 76,500,000
============
|
Exhibit 3.1
AMENDED AND RESTATED LIMITED LIABILITY COMPANY AGREEMENT
OF
WFN CREDIT COMPANY, LLC
This Amended and Restated Limited Liability Company Agreement (together with the schedules attached hereto, this "AGREEMENT") of WFN Credit Company, LLC (the "COMPANY"), is entered into by World Financial Network National Bank, as the sole equity member (the "ECONOMIC MEMBER"), and Evelyn Echevarria and Douglas K. Johnson, as the Special Members (as defined on Schedule A hereto). Capitalized terms used and not otherwise defined herein have the meanings set forth on SCHEDULE A hereto.
The Economic Member, by execution of the Limited Liability Company Agreement of WFN Credit Company, LLC, dated as of May 1, 2001 (the "EXISTING LLC AGREEMENT") and filing of the Certificate of Formation, formed the Company as a limited liability company pursuant to and in accordance with the Delaware Limited Liability Company Act (6 DEL. C. Section 18-101 ET SEQ.), as amended from time to time.
The Economic Member now desires to amend and restate in its entirety the Existing LLC Agreement in order to, among other things, provide for the admission of Evelyn Echevarria and Douglas K. Johnson as Special Members.
The Economic Member, Evelyn Echevarria and Douglas K. Johnson hereby agrees as follows:
Section 1. NAME.
The name of the limited liability company formed hereby is WFN Credit Company, LLC.
Section 2. PRINCIPAL BUSINESS OFFICE.
The principal business office of the Company shall be located at 220 West Schrock Road, Westerville, Ohio 43801 or such other location as may hereafter be determined by the Economic Member.
Section 3. REGISTERED OFFICE.
The address of the registered office of the Company in the State of Delaware is c/o The Corporation Trust Company, 1209 Orange Street, in the City of Wilmington, County of New Castle, Delaware 19801.
Section 4. REGISTERED AGENT.
The name and address of the registered agent of the Company for service of process on the Company in the State of Delaware is The Corporation Trust Company, 1209 Orange Street, in the City of Wilmington, County of New Castle, Delaware 19801.
Section 5. MEMBERS.
(a) The mailing address of the Economic Member is set forth on SCHEDULE B attached hereto. The Economic Member was admitted to the Company as a member of the Company upon its execution of a counterpart signature page to the Existing LLC Agreement.
(b) Subject to SECTION 9(j), the Economic Member may act by written consent.
(c) Upon the occurrence of any event that causes the Economic Member to
cease to be a member of the Company (other than (i) upon an assignment by the
Economic Member of all of its limited liability company interest in the Company
and the admission of the transferee pursuant to SECTIONS 21 and 23, or (ii) the
resignation of the Economic Member and the admission of an additional member of
the Company pursuant to SECTIONS 22 and 23), each person acting as an
Independent Director pursuant to SECTION 10 shall, without any action of any
Person and simultaneously with the Economic Member ceasing to be a member of the
Company, automatically be admitted to the Company as a Special Member and shall
continue the Company without dissolution. No Special Member may resign from the
Company or transfer its rights as Special Member unless (i) a successor Special
Member has been admitted to the Company as Special Member by executing a
counterpart to this Agreement, and (ii) such successor has also accepted its
appointment as Independent Director pursuant to SECTION 10; provided, however,
the Special Members shall automatically cease to be members of the Company upon
the admission to the Company of a substitute Economic Member. Each Special
Member shall be a member of the Company that has no interest in the profits,
losses and capital of the Company and has no right to receive any distributions
of Company assets. Pursuant to Section 18-301 of the Act, a Special Member shall
not be required to make any capital contributions to the Company and shall not
receive a limited liability company interest in the Company. A Special Member,
in its capacity as Special Member, may not bind the Company. Except as required
by any mandatory provision of the Act, each Special Member, in its capacity as
Special Member, shall have no right to vote on, approve or otherwise consent to
any action by, or matter relating to, the Company, including, without
limitation, the merger, consolidation or conversion of the Company. Nothing in
the immediately preceding sentence shall limit the right of any Special Member
in his or her capacity as an Independent Director to vote on any actions as
further described herein. In order to implement the admission to the Company of
each Special Member, each person acting as an Independent Director pursuant to
SECTION 10 shall execute a counterpart to this Agreement. Prior to its admission
to the Company as Special Member, each person acting as an Independent Director
pursuant to SECTION 10 shall not be a member of the Company.
Section 6. CERTIFICATES.
Michael Perlowski is hereby designated as an "authorized person" within the meaning of the Act, and has executed, delivered and filed the Certificate of Formation of the Company with the Secretary of State of the State of Delaware. Upon the filing of the Certificate of Formation
with the Secretary of State of the State of Delaware, his powers as an "authorized person" ceased, and the Economic Member thereupon became the designated "authorized person" and shall continue as the designated "authorized person" within the meaning of the Act. The Economic Member or an Officer shall execute, deliver and file any other certificates (and any amendments and/or restatements thereof) necessary for the Company to qualify to do business in any other jurisdiction in which the Company may wish to conduct business.
The existence of the Company as a separate legal entity shall continue until cancellation of the Certificate of Formation as provided in the Act.
Section 7. PURPOSES. The purpose to be conducted or promoted by the Company is to engage in the following activities:
(a) to purchase or otherwise acquire from World Financial Network National Bank and its affiliates or trusts formed by World Financial Network National Bank or its affiliates, and to hold, sell, transfer or pledge or otherwise exercise ownership rights with respect to credit card receivables (or interests therein), recoveries and collections related to such credit card receivables, any rights of World Financial Network National Bank and its affiliates related to such credit card receivables and any and all proceeds of the foregoing (the "CREDIT CARD ASSETS");
(b) to act as settlor or depositor of trusts or other entities (a "TRUST") formed to issue bonds, notes, certificates or other securities secured by or evidencing beneficial ownership interests in the Credit Card Assets;
(c) to acquire, own, hold, transfer, assign, pledge and otherwise deal with bonds, notes, certificates and other securities issued by a Trust or pursuant to an indenture or similar agreement to which such a Trust is a party;
(d) to own equity interests in other limited liability companies or partnerships whose purposes are restricted to those set forth in clauses (a) through (c) above;
(e) for federal, state or local tax purposes, to serve as general partner of any Trust;
(f) to establish any reserve account, spread account or other credit enhancement for the benefit of any bond, note, certificate or other security issued by any Trust or under any related indenture and to otherwise invest any proceeds from Credit Card Assets and any other income as determined by the Company's board of directors;
(g) to issue membership interests as provided for herein; and
(h) to engage in any lawful act or activity and to exercise any powers permitted to limited liability companies organized under the laws of the State of Delaware that are related to or incidental to and necessary, suitable or convenient for the accomplishment of the purposes specified in CLAUSES (a) through (g) above (including, without limitation (i) the registration or qualification of any securities issued by any Trust under the federal securities laws or the Blue
Sky laws of any State or jurisdiction and (ii) the entering into of interest rate or basis swap, cap, floor or collar agreements, currency exchange agreements or similar hedging transactions and referral, management, servicing and administration agreements).
(i) The Company, by or through the Economic Member, or any Director or Officer on behalf of the Company, may enter into and perform the Transaction Documents and all documents, agreements, certificates, or financing statements contemplated thereby or related thereto, all without any further act, vote or approval of any other Person notwithstanding any other provision of this Agreement, the Act or applicable law, rule or regulation. The foregoing authorization shall not be deemed a restriction on the powers of the Economic Member or any Director or Officer to enter into other agreements on behalf of the Company.
Section 8. POWERS.
Subject to SECTION 9(j), the Company, and the Board of Directors and the Officers of the Company on behalf of the Company, (i) shall have and exercise all powers necessary, convenient or incidental to accomplish its purposes as set forth in SECTION 7 and (ii) shall have and exercise all of the powers and rights conferred upon limited liability companies formed pursuant to the Act.
Section 9. MANAGEMENT.
(a) BOARD OF DIRECTORS. Subject to SECTION 9(j), the business and affairs of the Company shall be managed by or under the direction of a Board of one or more Directors designated by the Economic Member. Subject to SECTION 10, the Economic Member may determine at any time in its sole and absolute discretion the number of Directors to constitute the Board. The authorized number of Directors may be increased or decreased by the Economic Member at any time in its sole and absolute discretion, upon notice to all Directors, and subject in all cases to SECTION 10. The initial number of Directors shall be five, two of which shall be Independent Directors pursuant to SECTION 10. Each Director elected, designated or appointed by the Economic Member shall hold office until a successor is elected and qualified or until such Director's earlier death, resignation, expulsion or removal. Each Director shall execute and deliver the Directors Agreement. A Director need not be a Special Member. The initial Directors designated by the Economic Member are listed on SCHEDULE D hereto.
(b) POWERS. Subject to SECTION 9(j), the Board of Directors shall have the power to do any and all acts necessary, convenient or incidental to or for the furtherance of the purposes described herein, including all powers, statutory or otherwise. Subject to SECTION 7, the Board of Directors has the authority to bind the Company.
(c) MEETING OF THE BOARD OF DIRECTORS. The Board of Directors of the Company may hold meetings, both regular and special, within or outside the State of Delaware. Regular meetings of the Board may be held without notice at such time and at such place as shall from time to time be determined by the Board. Special meetings of the Board may be called by the President on not less than one day's notice to each Director by telephone, facsimile, mail, telegram or any other means of communication, and special meetings shall be called by the
President or Secretary in like manner and with like notice upon the written request of any one or more of the Directors.
(d) QUORUM: ACTS OF THE BOARD. At all meetings of the Board, a majority of the Directors shall constitute a quorum for the transaction of business and, except as otherwise provided in any other provision of this Agreement, the act of a majority of the Directors present at any meeting at which there is a quorum shall be the act of the Board. If a quorum shall not be present at any meeting of the Board, the Directors present at such meeting may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present. Any action required or permitted to be taken at any meeting of the Board or of any committee thereof may be taken without a meeting if all members of the Board or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board or committee, as the case may be.
(e) ELECTRONIC COMMUNICATIONS. Members of the Board, or any committee designated by the Board, may participate in meetings of the Board, or any committee, by means of telephone conference or similar communications equipment that allows all Persons participating in the meeting to hear each other, and such participation in a meeting shall constitute presence in Person at the meeting. If all the participants are participating by telephone conference or similar communications equipment, the meeting shall be deemed to be held at the principal place of business of the Company.
(f) COMMITTEES OF DIRECTORS.
(i) The Board may, by resolution passed by a majority of the whole Board, designate one or more committees, each committee to consist of one or more of the Directors of the Company. The Board may designate one or more Directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee.
(ii) In the absence or disqualification of a member of a committee, the member or members thereof present at any meeting and not disqualified from voting, whether or not such members constitute a quorum, may unanimously appoint another member of the Board to act at the meeting in the place of any such absent or disqualified member.
(iii) Any such committee, to the extent provided in the resolution of the Board, shall have and may exercise all the powers and authority of the Board in the management of the business and affairs of the Company. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the Board. Each committee shall keep regular minutes of its meetings and report the same to the Board when required.
(g) COMPENSATION OF DIRECTORS; EXPENSES. The Board shall have the authority to fix the compensation of Directors. The Directors may be paid their expenses, if any, of attendance at
meetings of the Board, which may be a fixed sum for attendance at each meeting of the Board or a stated salary as Director. No such payment shall preclude any Director from serving the Company in any other capacity and receiving compensation therefor. Members of special or standing committees may be allowed like compensation for attending committee meetings.
(h) REMOVAL OF DIRECTORS. Unless otherwise restricted by law, any Director or the entire Board of Directors may be removed or expelled, with or without cause, at any time by the Economic Member, and any vacancy caused by any such removal or expulsion may be filled by action of the Economic Member.
(i) DIRECTORS AS AGENTS. To the extent of their powers set forth in this Agreement and subject to SECTION 9(j), the Directors are agents of the Company for the purpose of the Company's business, and the actions of the Directors taken in accordance with such powers set forth in this Agreement shall bind the Company. Notwithstanding the last sentence of Section 18-402 of the Act, except as provided in this Agreement or in a resolution of the Directors, a Director may not bind the Company.
(j) LIMITATIONS ON THE COMPANY'S ACTIVITIES.
(i) This SECTION 9(j) is being adopted in order to comply with certain provisions required in order to qualify the Company as a "special purpose" entity.
(ii) The Economic Member shall not, so long as any Obligation is outstanding, amend, alter, change or repeal the definition of "Independent Director" or SECTIONS 5(c), 7, 8, 9, 10, 16, 20, 21, 22, 23, 24, 25, 26 or 31 or SCHEDULE A of this Agreement without the unanimous written consent of the Board (including all Independent Directors). Subject to this SECTION 9(j), the Economic Member reserves the right to amend, alter, change or repeal any provisions contained in this Agreement in accordance with SECTION 31.
(iii) Notwithstanding any other provision of this Agreement and any provision of law that otherwise so empowers the Company, the Economic Member, any Special Member, the Board, any Officer or any other Person, neither the Economic Member nor any Special Member nor the Board nor any Officer nor any other Person shall be authorized or empowered, nor shall they permit the Company, without the prior unanimous written consent of the Economic Member and the Board (including all Independent Directors), to take any Material Action, PROVIDED, HOWEVER, that the Board may not vote on, or authorize the taking of, any Material Action, unless there are at least two Independent Directors then serving in such capacity.
(iv) The Board and the Economic Member shall cause the Company to do or cause to be done all things necessary to preserve and keep in full force and effect its existence, rights (charter and statutory) and franchises; PROVIDED,
HOWEVER, that the Company shall not be required to preserve any such right or franchise if: (1) the Board shall determine that the preservation thereof is no longer desirable for the conduct of its business and that the loss thereof is not disadvantageous in any material respect to the Company and (2) so long as the Obligations are outstanding, the Rating Agency Condition is satisfied. The Board also shall cause the Company to:
(A) maintain its own separate books and records and bank accounts;
(B) at all times hold itself out to the public and all other Persons as a legal entity separate from the Economic Member and any other Person;
(C) have a Board of Directors separate from that of the Economic Member and any other Person;
(D) file its own tax returns, if any, as may be
required under applicable law, to the extent
(1) not part of a consolidated group filing
a consolidated return or returns or (2) not
treated as a division for tax purposes of
another taxpayer, and pay any taxes so
required to be paid under applicable law;
(E) except as contemplated by the Transaction Documents, not commingle its assets with assets of any other Person;
(F) conduct its business in its own name and strictly comply with all organizational formalities to maintain its separate existence;
(G) maintain separate financial statements;
(H) pay its own liabilities only out of its own funds;
(I) maintain an arm's length relationship with its Affiliates and the Economic Member;
(J) pay the salaries of its own employees, if any;
(K) not hold out its credit or assets as being available to satisfy the obligations of others;
(L) allocate fairly and reasonably any overhead for shared office space;
(M) use separate stationery, invoices and checks;
(N) except as contemplated by the Transaction Documents, not pledge its assets for the benefit of any other Person;
(O) correct any known misunderstanding regarding its separate identity;
(P) maintain adequate capital in light of its contemplated business purpose, transactions and liabilities;
(Q) cause its Board of Directors to meet at least annually or act pursuant to written consent and keep minutes of such meetings and actions and observe all other Delaware limited liability company formalities;
(R) not acquire any securities of the Economic Member; and
(S) cause the Directors, Officers, agents and other representatives of the Company to act at all times with respect to the Company consistently and in furtherance of the foregoing and in the best interests of the Company.
Failure of the Company, or the Economic Member or Board on behalf of the Company, to comply with any of the foregoing covenants or any other covenants contained in this Agreement shall not affect the status of the Company as a separate legal entity or the limited liability of the Economic Member or the Directors.
(v) So long as any Obligation is outstanding, the Board shall not cause or permit the Company to:
(A) except as contemplated by the Transaction Documents, guarantee any obligation of any Person, including any Affiliate;
(B) engage, directly or indirectly, in any business other than the actions required or permitted to be performed under SECTION 7, the Transaction Documents or this SECTION 9(j);
(C) incur, create or assume any indebtedness other than as expressly permitted under the Transaction Documents;
(D) make or permit to remain outstanding any
loan or advance to, or, except as permitted
by SECTION 7 and CLAUSE (j)(iii) of this
SECTION (9), to own or acquire any stock or
securities of, any Person, except that the
Company may invest in those investments
permitted under the Transaction Documents
and may make any advance required or
expressly permitted to be made pursuant to
any provisions of the Transaction Documents and permit the same to remain outstanding in accordance with such provisions;
(E) to the fullest extent permitted by law, engage in any dissolution or liquidation other than such activities as are expressly permitted pursuant to any provision of the Transaction Documents; or
(F) except as permitted by SECTION 7 and CLAUSE (j)(iii) of this SECTION 9, to form, acquire or hold any subsidiary (whether corporate, partnership, limited liability company or other).
Section 10. INDEPENDENT DIRECTOR.
As long as any Obligation is outstanding, the Economic Member shall cause the Company at all times to have at least two Independent Directors who will be appointed by the Economic Member. To the fullest extent permitted by law, including Section 18-1101(c) of the Act, the Independent Directors shall consider only the interests of the Company, including its respective creditors, in acting or otherwise voting on the matters referred to in SECTION 9(j)(iii). No resignation or removal of an Independent Director, and no appointment of a successor Independent Director, shall be effective until such successor (i) shall have accepted his or her appointment as an Independent Director by a written instrument, which may be a counterpart signature page to the Directors Agreement, and (ii) shall have executed a counterpart to this Agreement as required by SECTION 5(c). In the event of a vacancy in the position of Independent Director, the Economic Member shall, as soon as practicable, appoint a successor Independent Director. All right, power and authority of the Independent Directors shall be limited to the extent necessary to exercise those rights and perform those duties specifically set forth in this Agreement. Except as provided in the second sentence of this SECTION 10, in exercising their rights and performing their duties under this Agreement, any Independent Director shall have a fiduciary duty of loyalty and care similar to that of a director of a business corporation organized under the General Corporation Law of the State of Delaware. No Independent Director shall at any time serve as trustee in bankruptcy for any Affiliate of the Company.
Section 11. OFFICERS.
(a) OFFICERS. The initial Officers of the Company shall be designated by the Economic Member. The additional or successor Officers of the Company shall be chosen by the Board and shall consist of at least a President, a Secretary and a Treasurer. The Board of Directors may also choose one or more Vice Presidents, Assistant Secretaries and Assistant Treasurers. Any number of offices may be held by the same person. The Board shall choose a President, a Secretary and a Treasurer. The Board may appoint such other Officers and agents as it shall deem necessary or advisable who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board. The salaries of all Officers and agents of the Company shall be fixed by or in the manner prescribed by the Board. The Officers of the Company shall hold office until their successors are chosen and qualified. Any Officer may be removed at any time, with or without cause, by the affirmative vote of a majority of the Board. Any vacancy occurring in any office of the
Company shall be filled by the Board. The initial Officers of the Company designated by the Economic Member are listed on Schedule E hereto.
(b) PRESIDENT. The President shall be the chief executive officer of the Company, shall preside at all meetings of the Board, shall be responsible for the general and active management of the business of the Company and shall see that all orders and resolutions of the Board are carried into effect. The President or any other Officer authorized by the President or the Board shall execute all bonds, mortgages and other contracts, except: (i) where required or permitted by law or this Agreement to be otherwise signed and executed, including SECTION 7(b); (ii) where signing and execution thereof shall be expressly delegated by the Board to some other Officer or agent of the Company, and (iii) as otherwise permitted in SECTION 11(c).
(c) VICE PRESIDENT. In the absence of the President or in the event of the President's inability to act, the Vice President, if any (or in the event there be more than one Vice President, the Vice Presidents in the order designated by the Directors, or in the absence of any designation, then in the order of their election), shall perform the duties of the President, and when so acting, shall have all the powers of and be subject to all the restrictions upon the President. The Vice Presidents, if any, shall perform such other duties and have such other powers as the Board may from time to time prescribe.
(d) SECRETARY AND ASSISTANT SECRETARY. The Secretary shall be responsible for filing legal documents and maintaining records for the Company. The Secretary shall attend all meetings of the Board and record all the proceedings of the meetings of the Company and of the Board in a book to be kept for that purpose and shall perform like duties for the standing committees when required. The Secretary shall give, or shall cause to be given, notice of all meetings of the Economic Member, if any, and special meetings of the Board, and shall perform such other duties as may be prescribed by the Board or the President, under whose supervision the Secretary shall serve. The Assistant Secretary, or if there be more than one, the Assistant Secretaries in the order determined by the Board (or if there be no such determination, then in order of their election), shall, in the absence of the Secretary or in the event of the Secretary's inability to act, perform the duties and exercise the powers of the Secretary and shall perform such other duties and have such other powers as the Board may from time to time prescribe.
(e) TREASURER AND ASSISTANT TREASURER. The Treasurer shall have the custody of the Company funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Company and shall deposit all moneys and other valuable effects in the name and to the credit of the Company in such depositories as may be designated by the Board. The Treasurer shall disburse the funds of the Company as may be ordered by the Board, taking proper vouchers for such disbursements, and shall render to the President and to the Board, at its regular meetings or when the Board so requires, an account of all of the Treasurer's transactions and of the financial condition of the Company. The Assistant Treasurer, or if there shall be more than one, the Assistant Treasurers in the order determined by the Board (or if there be no such determination, then in the order of their election), shall, in the absence of the Treasurer or in the event of the Treasurer's inability to act, perform the duties and exercise the powers of the Treasurer and shall perform such other duties and have such other powers as the Board may from time to time prescribe.
(f) OFFICERS AS AGENTS. The Officers, to the extent of their powers set forth in this Agreement or otherwise vested in them by action of the Board not inconsistent with this Agreement, are agents of the Company for the purpose of the Company's business and, subject to SECTION 9(J), the actions of the Officers taken in accordance with such powers shall bind the Company.
(g) DUTIES OF BOARD AND OFFICERS. Except to the extent otherwise provided herein, each Director and Officer shall have a fiduciary duty of loyalty and care similar to that of directors and officers of business corporations organized under the General Corporation Law of the State of Delaware.
Section 12. LIMITED LIABILITY.
Except as otherwise expressly provided by the Act, the debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be the debts, obligations and liabilities solely of the Company, and neither the Economic Member nor the Special Members nor any Director shall be obligated personally for any such debt, obligation or liability of the Company solely by reason of being an Economic Member, a Special Member or a Director of the Company.
Section 13. CAPITAL CONTRIBUTIONS.
The Economic Member has contributed to the Company property of an
agreed value as listed on SCHEDULE B attached hereto. In accordance with Section
5(c), the Special Members shall not be required to make any capital
contributions to the Company.
Section 14. ADDITIONAL CONTRIBUTIONS.
The Economic Member is not required to make any additional capital contribution to the Company. However, the Economic Member may make additional capital contributions to the Company at any time upon the written consent of such Economic Member. To the extent that the Economic Member makes an additional capital contribution to the Company, the Economic Member shall revise SCHEDULE B of this Agreement. The provisions of this Agreement, including this SECTION 14, are intended to benefit the Economic Member and the Special Members and, to the fullest extent permitted by law, shall not be construed as conferring any benefit upon any creditor of the Company (and no such creditor of the Company shall be a third- party beneficiary of this Agreement) and the Economic Member and the Special Members shall not have any duty or obligation to any creditor of the Company to make any contribution to the Company or to issue any call for capital pursuant to this Agreement.
Section 15. ALLOCATION OF PROFITS AND LOSSES.
The Company's profits and losses shall be allocated to the Economic Member.
Section 16. DISTRIBUTIONS.
Distributions shall be made to the Economic Member at the times and in the aggregate amounts determined by the Board. Notwithstanding any provision to the contrary contained in this Agreement, the Company shall not be required to make a distribution to the Economic Member on account of its interest in the Company if such distribution would violate Section 18-607 of the Act or any other applicable law or any Transaction Document.
Section 17. BOOKS AND RECORDS.
The Board shall keep or cause to be kept complete and accurate books of account and records with respect to the Company's business. The books of the Company shall at all times be maintained by the Board. The Economic Member and its duly authorized representatives shall have the right to examine the Company books, records and documents during normal business hours. The Company, and the Board on behalf of the Company, shall not have the right to keep confidential from the Economic Member any information that the Board would otherwise be permitted to keep confidential from the Economic Member pursuant to Section 18-305(c) of the Act. The Company's books of account shall be kept using the method of accounting determined by the Economic Member. The Company's independent auditor, if any, shall be an independent public accounting firm selected by the Economic Member.
Section 18. REPORTS.
(a) Within 60 days after the end of each fiscal quarter, the Board shall cause to be prepared an unaudited report setting forth as of the end of such fiscal quarter:
(i) unless such quarter is the last fiscal quarter, a balance sheet of the Company; and
(ii) unless such quarter is the last fiscal quarter, an income statement of the Company for such fiscal quarter.
(b) The Board shall use diligent efforts to cause to be prepared and mailed to the Economic Member, within 90 days after the end of each fiscal year, an audited or unaudited report setting forth as of the end of such fiscal year:
(i) a balance sheet of the Company;
(ii) an income statement of the Company for such fiscal year; and
(iii) a statement of the Economic Member's capital account.
(c) The Board shall, after the end of each fiscal year, use reasonable efforts to cause the Company's independent accountants, if any, to prepare and transmit to the Economic Member as promptly as possible any such tax information as may be reasonably necessary to enable the
Economic Member to prepare its federal, state and local income tax returns relating to such fiscal year.
Section 19. OTHER BUSINESS.
The Economic Member, the Special Members and any Affiliate of the Economic Member or the Special Members may engage in or possess an interest in other business ventures (unconnected with the Company) of every kind and description, independently or with others. The Company shall not have any rights in or to such independent ventures or the income or profits therefrom by virtue of this Agreement.
Section 20. EXCULPATION AND INDEMNIFICATION.
(a) Neither the Economic Member nor the Special Members nor any Officer, Director, employee or agent of the Company nor any employee, representative, agent or Affiliate of the Economic Member or the Special Members (collectively, the "COVERED PERSONS") shall be liable to the Company or any other Person who has an interest in or claim against the Company for any loss, damage or claim incurred by reason of any act or omission performed or omitted by such Covered Person in good faith on behalf of the Company and in a manner reasonably believed to be within the scope of the authority conferred on such Covered Person by this Agreement, except that a Covered Person shall be liable for any such loss, damage or claim incurred by reason of such Covered Person's gross negligence or willful misconduct.
(b) To the fullest extent permitted by applicable law, a Covered Person shall be entitled to indemnification from the Company for any loss, damage or claim incurred by such Covered Person by reason of any act or omission performed or omitted by such Covered Person in good faith on behalf of the Company and in a manner reasonably believed to be within the scope of the authority conferred on such Covered Person by this Agreement, except that no Covered Person shall be entitled to be indemnified in respect of any loss, damage or claim incurred by such Covered Person by reason of such Covered Person's gross negligence or willful misconduct with respect to such acts or omissions; PROVIDED, HOWEVER, that any indemnity under this SECTION 20 by the Company shall be provided out of and to the extent of Company assets only, and the Economic Member and the Special Members shall not have personal liability on account thereof; and PROVIDED FURTHER, that so long as any Obligation is outstanding, no indemnity payment from funds of the Company (as distinct from funds from other sources, such as insurance) of any indemnity under this SECTION 20 shall be payable from amounts allocable to any other Person pursuant to the Transaction Documents.
(c) To the fullest extent permitted by applicable law, expenses (including legal fees) incurred by a Covered Person defending any claim, demand, action, suit or proceeding shall, from time to time, be advanced by the Company prior to the final disposition of such claim, demand, action, suit or proceeding upon receipt by the Company of an undertaking by or on behalf of the Covered Person to repay such amount if it shall be determined that the Covered Person is not entitled to be indemnified as authorized in this SECTION 20.
(d) A Covered Person shall be fully protected in relying in good faith upon the records of the Company and upon such information, opinions, reports or statements presented to the Company by any Person as to matters the Covered Person reasonably believes are within such other Person's professional or expert competence and who has been selected with reasonable care by or on behalf of the Company, including information, opinions, reports or statements as to the value and amount of the assets, liabilities, or any other facts pertinent to the existence and amount of assets from which distributions to the Economic Member might properly be paid.
(e) To the extent that, at law or in equity, a Covered Person has duties (including fiduciary duties) and liabilities relating thereto to the Company or to any other Covered Person, a Covered Person acting under this Agreement shall not be liable to the Company or to any other Covered Person for its good faith reliance on the provisions of this Agreement or any approval or authorization granted by the Company or any other Covered Person. The provisions of this Agreement, to the extent that they restrict the duties and liabilities of a Covered Person otherwise existing at law or in equity, are agreed by the Economic Member and the Special Members to replace such other duties and liabilities of such Covered Person.
(f) The foregoing provisions of this SECTION 20 shall survive any termination of this Agreement.
Section 21. ASSIGNMENTS.
Subject to SECTION 23, the Economic Member may assign in whole or in part its limited liability company interest in the Company. If the Economic Member transfers all of its limited liability company interest in the Company pursuant to this SECTION 21, the transferee shall be admitted to the Company as a member of the Company upon its execution of an instrument signifying its agreement to be bound by the terms and conditions of this Agreement, which instrument may be a counterpart signature page to this Agreement. Such admission shall be deemed effective immediately prior to the transfer and, immediately following such admission, the transferor Economic Member shall cease to be a member of the Company. Notwithstanding anything in this Agreement to the contrary, any successor to the Economic Member by merger or consolidation in compliance with the Transaction Documents shall, without further act, be the Economic Member hereunder, and such merger or consolidation shall not constitute an assignment for purposes of this Agreement and the Company shall continue without dissolution.
Section 22. RESIGNATION.
So long as any Obligation is outstanding, the Economic Member may not resign, except as permitted under the Transaction Documents and if the Rating Agency Condition is satisfied. If the Economic Member is permitted to resign pursuant to this SECTION 22, an additional member of the Company shall be admitted to the Company, subject to SECTION 23, upon its execution of an instrument signifying its agreement to be bound by the terms and conditions of this Agreement, which instrument may be a counterpart signature page to this Agreement. Such admission shall be deemed effective immediately prior to the resignation and, immediately following such admission, the resigning Economic Member shall cease to be a member of the Company.
Section 23. ADMISSION OF ADDITIONAL MEMBERS.
One or more additional members of the Company may be admitted to the Company with the written consent of the Economic Member; PROVIDED, HOWEVER, that, notwithstanding the foregoing, so long as any Obligation remains outstanding, no additional Economic Member may be admitted to the Company unless the Rating Agency Condition is satisfied.
Section 24. DISSOLUTION.
(a) Subject to SECTION 9(j), the Company shall be dissolved, and its affairs shall be wound up upon the first to occur of the following: (i) the termination of the legal existence of the last remaining member of the Company or the occurrence of any other event which terminates the continued membership of the last remaining member of the Company in the Company unless the business of the Company is continued in a manner permitted by this Agreement or the Act or (ii) the entry of a decree of judicial dissolution under Section 18-802 of the Act. Upon the occurrence of any event that causes the last remaining member of the Company to cease to be a member of the Company, to the fullest extent permitted by law, the personal representative of such member is hereby authorized to, and shall, within 90 days after the occurrence of the event that terminated the continued membership of such member in the Company, agree in writing (i) to continue the Company and (ii) to the admission of the personal representative or its nominee or designee, as the case may be, as a substitute member of the Company, effective as of the occurrence of the event that terminated the continued membership of the last remaining member of the Company in the Company.
(b) Notwithstanding any other provision of this Agreement, the Bankruptcy of the Economic Member or a Special Member shall not cause the Economic Member or Special Member, respectively, to cease to be a member of the Company and upon the occurrence of such an event, the business of the Company shall continue without dissolution.
(c) In the event of dissolution, the Company shall conduct only such activities as are necessary to wind up its affairs (including the sale of the assets of the Company in an orderly manner), and the assets of the Company shall be applied in the manner, and in the order of priority, set forth in Section 18-804 of the Act.
(d) The Company shall terminate when (i) all of the assets of the Company, after payment of or due provision for all debts, liabilities and obligations of the Company shall have been distributed to the Economic Member in the manner provided for in this Agreement and (ii) the Certificate of Formation shall have been canceled in the manner required by the Act.
Section 25. WAIVER OF PARTITION; NATURE OF INTEREST.
Except as otherwise expressly provided in this Agreement, to the fullest extent permitted by law, each of the Economic Member and the Special Members hereby irrevocably waives any right or power that such Person might have to cause the Company or any of its assets to be partitioned, to cause the appointment of a receiver for all or any portion of the assets of the Company, to compel any sale of all or any portion of the assets of the Company pursuant to any
applicable law or to file a complaint or to institute any proceeding at law or in equity to cause the dissolution, liquidation, winding up or termination of the Company. The Economic Member shall not have any interest in any specific assets of the Company, and the Economic Member shall not have the status of a creditor with respect to any distribution pursuant to SECTION 16 hereof. The interest of the Economic Member in the Company is personal property.
Section 26. BENEFITS OF AGREEMENT; NO THIRD-PARTY RIGHTS.
None of the provisions of this Agreement shall be for the benefit of or enforceable by any creditor of the Company or by any creditor of the Economic Member or a Special Member. Nothing in this Agreement shall be deemed to create any right in any Person (other than Covered Persons) not a party hereto, and this Agreement shall not be construed in any respect to be a contract in whole or in part for the benefit of any third Person (except as provided in SECTION 29).
Section 27. SEVERABILITY OF PROVISIONS.
Each provision of this Agreement shall be considered severable and if for any reason any provision or provisions herein are determined to be invalid, unenforceable or illegal under any existing or future law, such invalidity, unenforceability or illegality shall not impair the operation of or affect those portions of this Agreement which are valid, enforceable and legal.
Section 28. ENTIRE AGREEMENT.
This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof.
Section 29. BINDING AGREEMENT.
Notwithstanding any other provision of this Agreement, the Economic Member agrees that this Agreement, including, without limitation, SECTIONS 7, 8, 9, 10, 20, 21, 22, 23, 24, 26, 29 and 31, constitutes a legal, valid and binding agreement of the Economic Member, and is enforceable against the Economic Member by the Independent Directors, in accordance with its terms. In addition, the Independent Directors shall be intended beneficiaries of this Agreement.
Section 30. GOVERNING LAW.
This Agreement shall be governed by and construed under the laws of the State of Delaware (without regard to conflict of laws principles), all rights and remedies being governed by said laws.
Section 31. AMENDMENTS.
Subject to Section 9(j), this Agreement may be modified, altered, supplemented or amended pursuant to a written agreement executed and delivered by the Economic Member. Notwithstanding anything to the contrary in this Agreement, so long as any Obligation is outstanding, this Agreement may not be modified, altered, supplemented or amended unless the
Rating Agency Condition is satisfied except: (i) to cure any ambiguity or (ii) to convert or supplement any provision in a manner consistent with the intent of this Agreement and the other Transaction Documents.
Section 32. COUNTERPARTS.
This Agreement may be executed in any number of counterparts, each of which shall be deemed an original of this Agreement and all of which together shall constitute one and the same instrument.
Section 33. NOTICES.
Any notices required to be delivered hereunder shall be in writing and
personally delivered, mailed or sent by telecopy, electronic mail or other
similar form of rapid transmission, and shall be deemed to have been duly given
upon receipt (a) in the case of the Company, to the Company at its address in
SECTION 2, (b) in the case of the Economic Member, to the Economic Member at its
address as listed on SCHEDULE B attached hereto and (c) in the case of either of
the foregoing, at such other address as may be designated by written notice to
the other party.
Section 34. EFFECTIVENESS.
Pursuant to Section 18-201 (d) of the Act, this Agreement shall be effective as of August 21, 2001.
IN WITNESS WHEREOF, the undersigned, intending to be legally bound hereby, has duly executed this Limited Liability Company Agreement as of the 21 day of August, 2001.
ECONOMIC MEMBER:
WORLD FINANCIAL NETWORK
NATIONAL BANK
By: /s/ Daniel T. Groomes
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Name: Daniel T. Groomes
Title: Chief Financial Officer
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SPECIAL MEMBERS:
Evelyn Echevarria
By: /s/ Evelyn Echevarria
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Douglas K. Johnson
By: /s/ Douglas K. Johnson
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SCHEDULE A
DEFINITIONS
A. DEFINITIONS
When used in this Agreement, the following terms not otherwise defined herein have the following meanings:
"ACT" has the meaning set forth in the preamble to this Agreement.
"AFFILIATE" means, with respect to any Person, any other Person directly or indirectly Controlling or Controlled by or under direct or indirect common Control with such Person.
"AGREEMENT" means this Limited Liability Company Agreement of the Company, together with the schedules attached hereto, as amended, restated or supplemented or otherwise modified from time to time.
"BANKRUPTCY" means, with respect to any Person, if such Person (i) makes an assignment for the benefit of creditors, (ii) files a voluntary petition in bankruptcy, (iii) is adjudged a bankrupt or insolvent, or has entered against it an order for relief, in any bankruptcy or insolvency proceedings, (iv) files a petition or answer seeking for itself any reorganization, arrangement, composition, readjustment, liquidation or similar relief under any statute, law or regulation, (v) files an answer or other pleading admitting or failing to contest the material allegations of a petition filed against it in any proceeding of this nature, (vi) seeks, consents to or acquiesces in the appointment of a trustee, receiver or liquidator of the Person or of all or any substantial part of its properties, or (vii) if 90 days after the commencement of any proceeding against the Person seeking reorganization, arrangement, composition, readjustment, liquidation or similar relief under any statute, law or regulation, if the proceeding has not been dismissed, or if within 60 days after the appointment without such Person's consent or acquiescence of a trustee, receiver or liquidator of such Person or of all or any substantial part of its properties, the appointment is not vacated or stayed, or within 90 days after the expiration of any such stay, the appointment is not vacated. The foregoing definition of "Bankruptcy" is intended to replace and shall supersede and replace the definition of"Bankruptcy" set forth in Sections 18-101(1) and 18-304 of the Act.
"BOARD" or "BOARD OF DIRECTORS" means the Board of Directors of the Company.
"CERTIFICATE OF FORMATION" means the Certificate of Formation of the Company filed with the Secretary of State of the State of Delaware on May 1, 2001, as amended or amended and restated from time to time.
"COMPANY" means WFN Credit Company, LLC, a Delaware limited liability company.
"CONTROL" means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ownership of voting
securities or general partnership or managing member interests, by contract or otherwise. "Controlling" and "Controlled" shall have correlative meanings. Without limiting the generality of the foregoing, a Person shall be deemed to Control any other Person in which it owns, directly or indirectly, a majority of the ownership interests.
"COVERED PERSONS" has the meaning set forth in SECTION 20(a).
"CREDIT CARD ASSETS" is defined in SECTION 7.
"DIRECTORS" means the Persons elected to the Board of Directors from time to time by the Member. A Director is hereby designated as a "manager" of the Company within the meaning of Section 18-101(10) of the Act.
"DIRECTORS AGREEMENT" means the agreement of the Directors in the form attached hereto as Schedule C-1 or C-2. The Directors Agreement shall be deemed incorporated into, and a part of, this Agreement.
"ECONOMIC MEMBER" means World Financial Network National Bank, as the initial member of the Company, and includes any Person admitted as an additional member of the Company or a substitute member of the Company pursuant to the provisions of this Agreement, each in its capacity as a member of the Company; provided, however, the term "Economic Member" shall not include the Special Members.
"INDEPENDENT DIRECTOR" means a natural person who, for the five-year
period prior to his or her appointment as Independent Director has not been, and
during the continuation of his or her service as Independent Director is not:
(i) an employee, director, stockholder, member, partner or officer of the
Company or any of its Affiliates (other than his or her service as a Special
Member or an Independent Director of the Company or other Affiliates that are
structured to be "bankruptcy remote"); (ii) a customer or supplier of the
Company or any of its Affiliates; or (iii) any member of the immediate family of
a person described in (i) or (ii).
"MATERIAL ACTION" means to consolidate or merge the Company with or into any Person, or sell all or substantially all of the assets of the Company, or to institute proceedings to have the Company be adjudicated bankrupt or insolvent, or consent to the institution of bankruptcy or insolvency proceedings against the Company or file a petition seeking, or consent to, reorganization or relief with respect to the Company under any applicable federal or state law relating to bankruptcy, or consent to the appointment of a receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the Company or a substantial part of its property, or make any assignment for the benefit of creditors of the Company, or admit in writing the Company's inability to pay its debts generally as they become due, or, to the fullest extent permitted by law, take action in furtherance of any such action, or dissolve or liquidate the Company.
"OBLIGATIONS" shall mean the indebtedness, liabilities and obligations of the Company or any Trust under or in connection with this Agreement, the other Transaction Documents or any related document in effect as of any date of determination.
"OFFICER" means an officer of the Company described in SECTION 11.
"OFFICER'S CERTIFICATE" means a certificate signed by any Officer of the Company who is authorized to act for the Company in matters relating to the Company.
"PERSON" means any individual, corporation, partnership, joint venture, limited liability company, limited liability partnership, association, joint stock company, trust, unincorporated organization, or other organization, whether or not a legal entity, and any governmental authority.
"RATING AGENCY CONDITION" has the meaning assigned to that term in the Transaction Documents.
"SPECIAL MEMBER" means, upon such person's admission to the Company as a member of the Company pursuant to SECTION 5(c), a person acting as Independent Director, in such person's capacity as a member of the Company. A Special Member shall only have the rights and duties expressly set forth in this Agreement.
"TRANSACTION DOCUMENTS" means this Agreement, the Directors Agreement, each pooling and servicing agreement, transfer and servicing agreement, receivables purchase agreement, indenture or other agreement entered into by the Company or by a trust at the direction of the Company from time to time in connection with the acquisition, creation, funding or financing of Credit Card Assets, and all other documents, instruments and certificates delivered in connection therewith.
B. RULES OF CONSTRUCTION
Definitions in this Agreement apply equally to both the singular and plural forms of the defined terms. The words "include" and "including" shall be deemed to be followed by the phrase "without limitation." The terms "herein," "hereof" and "hereunder" and other words of similar import refer to this Agreement as a whole and not to any particular Section, paragraph or subdivision. The Section titles appear as a matter of convenience only and shall not affect the interpretation of this Agreement. All Section, paragraph, clause, Exhibit or Schedule references not attributed to a particular document shall be references to such parts of this Agreement.
SCHEDULE B
MEMBER
Agreed Value of Membership
Name Mailing Address Capital Contribution Interest
---- --------------- -------------------- --------
World Financial 800 Techcenter Drive, $1,000 100%
Network National Gahanna, Ohio 43230
Bank
Attn: Daniel T. Groomes
|
SCHEDULE C-1
Directors Agreement
WFN Credit Company, LLC
[date]
For good and valuable consideration, each of the undersigned Persons, who have been designated as directors of WFN Credit Company, LLC, a Delaware limited liability company (the "Company"), in accordance with the Limited Liability Company Agreement of the Company, dated as of May 1, 2001, as it may be amended or restated from time to time (the "LLC AGREEMENT"), hereby agree as follows:
1. Each of the undersigned accepts such Person's rights and authority as a Director under the LLC Agreement and agrees to perform and discharge such Person's duties and obligations as a Director under the LLC Agreement, and further agrees that such rights, authorities, duties and obligations under the LLC Agreement shall continue until such Person's successor as a Director is designated or until such Person's resignation or removal as a Director in accordance with the LLC Agreement. Each of the undersigned agrees and acknowledges that it has been designated as a "manager" of the Company within the meaning of the Delaware Limited Liability Company Act.
2. So long as any Obligation is outstanding, each of the undersigned agrees, solely in its capacity as a creditor of the Company on account of any indemnification or other payment owing to the undersigned by the Company, not to acquiesce, petition or otherwise invoke or cause the Company to invoke the process of any court or governmental authority for the purpose of commencing or sustaining a case against the Company 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 Company or any substantial part of the property of the Company, or ordering the winding up or liquidation of the affairs of the Company.
3. THIS DIRECTORS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, AND ALL RIGHTS AND REMEDIES SHALL BE GOVERNED BY SUCH LAWS WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAWS.
Initially capitalized terms used and not otherwise defined herein have the meanings set forth in the LLC Agreement.
This Directors Agreement may be executed in any number of counterparts, each of which shall be deemed an original of this Directors Agreement and all of which together shall constitute one and the same instrument.
C-1-1
IN WITNESS WHEREOF, the undersigned have executed this Directors Agreement as of the day and year first above written.
C-1-2
SCHEDULE C-2
form of
INDEPENDENT DIRECTOR AGREEMENT
THIS Agreement ("AGREEMENT"), made as of the ____ day of _______________, 2001, is entered into by and between ___________________ ("INDEPENDENT DIRECTOR") and ____________________ (the "COMPANY").
RECITALS
WHEREAS, the Company is engaged in the business described in the Limited Liability Company Agreement attached as EXHIBIT A; and
WHEREAS, the Company desires to nominate and elect ______________ as the Independent Director.
NOW THEREFORE, the parties agree as follows.
1. INDEPENDENT DIRECTOR. The Company has designated the Independent Director as a Director under Section 9(a) of the Limited Liability Agreement and the Independent Director as an independent Director of the Company, agrees to perform the duties of an independent Director of the Company in a diligent manner, as described in EXHIBIT A attached hereto. The Company and the Independent Director recognize that the services of the Independent Director are to be rendered to the Company on a non-exclusive basis.
2. TERM. The term of this Agreement shall begin and be effective as of the date hereof, and shall end and terminate on ______________, 2002, except if terminated sooner by either party by providing thirty days written notice. Thereafter, this Agreement shall renew for successive one-year terms unless either party notifies the other in writing thirty days prior to the renewal date of that party's desire to cancel the Agreement. The Company understands that this Agreement shall terminate and the Independent Director shall immediately resign as the Independent Director of the Company if any payments due to AMACAR Group, L.L.C. under the terms of any agreement between AMACAR Group, L.L.C. and the Company remain unpaid for 30 days from the date above.
3. BUSINESS EXPENSES. The Company shall pay any reasonable expenses incurred by the Independent Director in the performance of his or her duties in accordance with such policies regarding expenses and travel that the Company may have in effect from time to time; and the Company shall promptly reimburse the Independent Director for such expenses upon the submission of appropriate receipts and vouchers unless AMACAR Group, L.L.C. has been reimbursed for such expenses.
C-2-1
4. CONFIDENTIALITY. From time to time the Independent Director will receive or otherwise obtain from the Company, in connection with the Independent Director's duties as a independent Director, certain information that is non-public, confidential or proprietary in nature (the "CONFIDENTIAL INFORMATION"). The Independent Director agrees to (i) not use any of the Confidential Information except in connection with fulfilling the duties of an independent Director of the Company and (ii) use reasonable efforts to prevent the disclosure of the Confidential Information to any person other than (a) to employees, agents, counsel and accountants of the Independent Director, each of whom the Independent Director will inform of the non-public, confidential and proprietary nature of such information, (b) as required by any regulatory or supervisory authority or (c) as otherwise required by applicable law. This agreement regarding the Confidential Information is not applicable to any Confidential Information that (i) is or becomes generally available to the public through no fault or action on the part of the Independent Director, or the Independent Director's employees, agents, counsel or accountants or (ii) is or becomes available to the Independent Director on a non-confidential basis from a source other than the Company or any of its affiliates. In the event the Independent Director is required to disclose the Confidential Information, the Independent Director will request confidential treatment thereof and provide the Company with written notice of the proposed disclosure prior to the disclosure.
5. ASSIGNMENT. The Independent Director acknowledges that the services to be rendered by him or her are expert, professional and personal. Accordingly, unless provided for elsewhere in this Agreement, the Independent Director may not assign any of his or her rights or delegate any of his or her duties or obligations under this Agreement; provided, however, that the Independent Director may enlist other personnel to assist him or her in carrying out his or her duties and obligations under this Agreement.
6. INDEMNIFICATION. In addition to, and not in limitation of, any
and all rights of indemnification under the Company's Limited Liability
Company Agreement and By-laws or otherwise (including, without limitation,
any insurance policies), the Company agrees to indemnify and hold harmless
the Independent Director from any and all loss, claim, damage or cause of
action, including reasonable attorneys' fees related thereto ("Claims")
incurred by the Independent Director in the performance of his or her duties
and obligations under this Agreement; provided, however, that the Independent
Director shall not be so indemnified for Claims if they arise from the
Independent Director's negligence or willful misconduct. The benefits of this
Section 6 shall survive the termination of this Agreement.
7. GOVERNING LAW. This Agreement shall be governed and construed in accordance with the laws of the State of North Carolina.
8. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between the parties hereto pertaining only to the subject matter hereof.
9. AMENDMENT. No supplement, modification, or amendment of this Agreement shall be binding unless signed and executed in writing by the parties or party to be charged.
C-2-2
10. WAIVER AND CONSENT. Failure of either party at any time to require performance by the other party of any provision hereof shall not affect in any way the right to require such performance at any time thereafter or performance of any other provision hereof, nor shall the waiver by either party of a breach of any provision hereof be taken or held to be a waiver of the provision itself.
11. NOTICES. All notices, requests, demand and communications required, provided for or contemplated in this Agreement must be in writing and sent to the parties at the following addresses:
If to the Independent Director: [name]
6525 Morrison Boulevard, Suite 318
Charlotte, North Carolina 28211
If to the Company: [name and address]
Attn:
----------------------------------
Telephone:
-----------------------------
Telecopy:
------------------------------
|
Or, to such other persons or addresses as any party may request by giving written notice of such change to the other party.
12. SEVERABILITY. The invalidity of any provision of this Agreement, as determined by a Court of competent jurisdiction, shall in no way affect the validity of any other provision thereof.
IN WITNESS WHEREOF, the Independent Director and the Company have signed this Agreement effective and binding as of the date first above written.
[Company]
C-2-3
EXHIBIT A
DUTIES OF THE INDEPENDENT DIRECTOR
Limited Liability Company Agreement
C-2-4
SCHEDULE D
1. Daniel T. Groomes
2. Robert P. Armiak
3. Carolyn S. Melvin
4. Evelyn Echevarria
5. Douglas K. Johnson
SCHEDULE E
OFFICERS TITLE -------- ----- Daniel T. Groomes President Robert P. Armiak Vice President and Treasurer Carolyn S. Melvin Senior Vice President and Secretary Karen Morauski Assistant Secretary Richard E. Schumacher, Jr. Vice President, Tax |
Exhibit 4.1
MASTER INDENTURE
between
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
Issuer,
and
BNY MIDWEST TRUST COMPANY,
Indenture Trustee
Dated as of August 1, 2001
RECONCILIATION AND TIE BETWEEN TRUST INDENTURE
ACT OF 1939 AND INDENTURE PROVISIONS(1)
Trust Indenture
Act Section Indenture Section
--------------- -----------------
310(a)(1)........................................... 6.11
(a)(2)........................................... 6.11
(a)(3)........................................... 6.10
(a)(4)........................................... Not Applicable
(a)(5)........................................... 6.11
(b).............................................. 6.8, 6.11
(c).............................................. Not Applicable
311(a).............................................. 6.12
(b).............................................. 6.12
(c).............................................. Not Applicable
312(a).............................................. 7.1, 7.2(a)
(b).............................................. 7.2(b)
(c).............................................. 7.2(c)
313(a).............................................. 7.4
(b).............................................. 7.4
(c).............................................. 7.3, 7.4
(d).............................................. 7.4
314(a).............................................. 3.9, 7.3(a)
(b).............................................. 3.6
(c)(1)........................................... 8.9,
12.1(a)
(c)(2)........................................... 8.9,
12.1(a)
(c)(3)........................................... 8.9,
12.1(a)
(d)(1)........................................... 8.9,
12.1(b)
(d)(2)........................................... Not Applicable
(d)(3)........................................... Not Applicable
(e).............................................. 12.1(a)
315(a).............................................. 6.1(b)
(b).............................................. 6.2
(c).............................................. 6.1(c)
(d).............................................. 6.1(d)
(d)(1)........................................... 6.1(d)
(d)(2............................................ 6.1(d)
(d)(3)........................................... 6.1(d)
(e).............................................. 5.14
316(a)(1)(A)........................................ 5.12
316(a)(1)(B)........................................ 5.13
316(a)(2)........................................... Not Applicable
316(b).............................................. 5.8
317(a)(1)........................................... 5.4
317(a)(2)........................................... 5.4(d)
317(b).............................................. 5.4(a)
318(a).............................................. 12.7
|
MASTER INDENTURE, dated as of August 1, 2001 (the "INDENTURE"), between World Financial Network Credit Card Master Note Trust, a business trust organized under the laws of the State of Delaware (the "ISSUER"), and BNY Midwest Trust Company, an Illinois trust company, as indenture trustee (the "INDENTURE TRUSTEE"). This Indenture may be supplemented at any time and from time to time by an indenture supplement in accordance with ARTICLE X (an "INDENTURE SUPPLEMENT," and together with this Indenture and any amendments, the "AGREEMENT"). If a conflict exists between the terms and provisions of this Indenture and any Indenture Supplement, the terms and provisions of the Indenture Supplement shall be controlling with respect to the related Series.
PRELIMINARY STATEMENT
Issuer has duly authorized the execution and delivery of this Indenture to provide for an issue of its Notes as provided in this Indenture. All covenants and agreements made by Issuer herein are for the benefit and security of the Noteholders. Issuer is entering into this Indenture, and Indenture Trustee is accepting the trusts created hereby, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged.
Simultaneously with the delivery of this Indenture, Issuer is entering into a Transfer and Servicing Agreement with WFN Credit Company, LLC, a Delaware limited liability company, as Transferor, and World Financial Network National Bank, a national banking association, as Servicer, pursuant to which (a) Transferor will convey to Issuer all of its right, title and interest in, to and under (i) the Collateral Certificate, which Transferor will have received from Certificate Trust pursuant to the Collateral Series Supplement, and (ii) on and after Certificate Trust Termination Date, the Receivables arising in the Accounts from time to time, which Transferor will have received from WFN pursuant to the Receivables Purchase Agreement and (b) Servicer will agree to service the Receivables and make collections thereon on behalf of the Noteholders on and after Certificate Trust Termination Date.
GRANTING CLAUSE
Issuer hereby Grants to Indenture Trustee, for the benefit of the Holders of the Notes and the Enhancement Providers, all of Issuer's right, title and interest, whether now owned or hereafter acquired, in, to and under (a) the Collateral Certificate, (b) the Receivables, (c) Collections and Recoveries related to and all money, instruments, investment property and other property distributed or distributable in respect of (together with all earnings, dividends, distributions, income, issues, and profits relating to) the Receivables pursuant to the terms of the Transfer and Servicing Agreement, this Indenture and any Indenture Supplement; (d) all Eligible Investments and all money, investment property, instruments and other property on deposit from time to time in, credited to or related to the Collection Account, the Series Accounts and the Excess Funding Account (including any subaccounts of any such account), and in all interest, dividends, earnings, income and other distributions from time to time received, receivable or otherwise distributed or distributable thereto or in respect thereof
(including any accrued discount realized on liquidation of any investment purchased at a discount); (e) all rights, remedies, powers, privileges and claims of Issuer under or with respect to any Enhancement and the Transfer and Servicing Agreement (whether arising pursuant to the terms of the related Enhancement Agreement or the Transfer and Servicing Agreement or otherwise available to Issuer at law or in equity), including the rights of Issuer to enforce such Enhancement Agreement or the Transfer and Servicing Agreement, and to give or withhold any and all consents, requests, notices, directions, approvals, extensions or waivers under or with respect to such Enhancement Agreement or the Transfer and Servicing Agreement to the same extent as Issuer could but for the assignment and security interest granted to Indenture Trustee for the benefit of the Noteholders; (f) all Insurance Proceeds; (g) all proceeds of any derivative contracts between Issuer and a counterparty, as described in any Indenture Supplement; (h) all money, accounts, general intangibles, chattel paper, instruments, documents, goods, investment property, deposit accounts, letters of credit, letter-of-credit rights and oil, gas, and other minerals consisting of, arising from or related to the foregoing; (i) all other property of Issuer; (j) all present and future claims, demands, causes and choses in action in respect of any or all of the foregoing and all payments on or under and all proceeds of every kind and nature whatsoever in respect of any or all of the foregoing, including all proceeds, products, rents, receipts or profits of the conversion, voluntary or involuntary, into cash or other property, all cash and non-cash proceeds, and other property consisting of, arising from or relating to all or any part of any of the foregoing; and (k) any proceeds of the foregoing (collectively, the "COLLATERAL").
LIMITED RECOURSE
The obligation of Issuer to make payments of principal, interest and other amounts in respect of the Notes is limited by recourse only to the Collateral.
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS.
Capitalized terms used herein are defined in ANNEX A.
Section 1.2 OTHER DEFINITIONAL PROVISIONS.
(a) All terms defined directly or by reference in this Indenture shall
have the defined meanings when used in any certificate or other document
delivered pursuant hereto unless otherwise defined therein. For purposes of this
Indenture and all such certificates and other documents, unless the context
otherwise requires: (i) accounting terms not otherwise defined in this
Indenture, and accounting terms partly defined in this Indenture to the extent
not defined, shall have the respective meanings given to them under GAAP; (ii)
terms defined in Article 9 of the UCC as in effect in the State of Delaware and
not otherwise defined in this Indenture are used as defined in that Article;
(iii) any reference to
each Rating Agency shall only apply to any specific rating agency if such rating agency is then rating any outstanding Series; (iv) references to any amount as on deposit or outstanding on any particular date means such amount at the close of business on such day; (v) the words "hereof," "herein" and "hereunder" and words of similar import refer to this Indenture (or the certificate or other document in which they are used) as a whole and not to any particular provision of this Indenture (or such certificate or document); (vi) references to any Section, Schedule or Exhibit are references to Sections, Schedules and Exhibits in or to this Indenture (or the certificate or other document in which the reference is made), and references to any paragraph, Section, clause or other subdivision within any Section or definition refer to such paragraph, subsection, clause or other subdivision of such Section or definition; (vii) the term "including" means "including without limitation"; (viii) references to any law or regulation refer to that law or regulation as amended from time to time and include any successor law or regulation; (ix) references to any Person include that Person's successors and assigns; and (x) headings are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof.
(b) Whenever this Indenture refers to a provision of the TIA, the provision is incorporated by reference in and made a part of this Indenture. The following TIA terms used in this Indenture have the following meanings:
"INDENTURE SECURITIES" means the Notes;
"INDENTURE SECURITY HOLDER" means a Noteholder;
"INDENTURE TO BE QUALIFIED" means this Indenture;
"INDENTURE TRUSTEE" or "institutional trustee" means Indenture Trustee; and
"OBLIGOR" on the indenture securities means Issuer and any other obligor on the indenture securities.
All other TIA terms used in this Indenture that are defined by the TIA, defined by TIA reference to another statute or defined by Commission rule have the meanings assigned to them by such definitions.
ARTICLE II
THE NOTES
Section 2.1 FORM GENERALLY. Any Series or Class of Notes, together with Indenture Trustee's certificate of authentication related thereto, may be issued in bearer form (the "BEARER NOTES") with attached interest coupons and a special coupon (collectively, the "COUPONS") or in fully registered form (the "REGISTERED NOTES") and shall be in substantially the form of an exhibit to the related Indenture Supplement with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture or such Indenture Supplement, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon, as may, consistently herewith, be determined by the officers executing such Notes, as evidenced by their execution of such Notes. Any portion of the text of any Note may be set forth on the reverse thereof, with an appropriate reference thereto on the face of the Note. The terms of any Notes set forth in an exhibit to the related Indenture Supplement are part of the terms of this Indenture, as applicable.
The Definitive Notes shall be typewritten, printed, lithographed or engraved or produced by any combination of these methods, all as determined by the officers executing such Notes, as evidenced by their execution of such Notes.
Each Note will be dated the Closing Date and each Definitive Note will be dated as of the date of its authentication.
Section 2.2 DENOMINATIONS. Except as otherwise specified in the related Indenture Supplement and the Notes, each class of Notes of each Series shall be issued in fully registered form in minimum amounts of $1,000 and in integral multiples of $1,000 in excess thereof (except that one Note of each Class may be issued in a different amount, so long as such amount exceeds the applicable minimum denomination for such Class), and shall be issued upon initial issuance as one or more Notes in an aggregate original principal amount equal to the applicable Note Principal Balance for such Class or Series.
Section 2.3 EXECUTION, AUTHENTICATION AND DELIVERY. Each Note shall be executed by manual or facsimile signature on behalf of Issuer by an Authorized Officer.
Notes 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 Issuer shall not be rendered invalid, notwithstanding the fact that such individual ceased to be so authorized prior to the authentication and delivery of such Notes or does not hold such office at the date of issuance of such Notes.
At any time and from time to time after the execution and delivery of this Indenture, Issuer may deliver Notes executed by Issuer to Indenture Trustee for authentication and delivery, and Indenture Trustee shall authenticate at the written direction of Issuer and deliver such Notes as provided in this Indenture or the
related Indenture Supplement and not otherwise. Each Note shall be dated the date of its authentication.
No Note shall be entitled to any benefit under this Indenture or the applicable Indenture Supplement or be valid or obligatory for any purpose, unless there appears on such Note a certificate of authentication substantially in the form provided for herein or in the related Indenture Supplement executed by or on behalf of Indenture Trustee by the manual signature of a duly authorized signatory, and such certificate upon any Note shall be conclusive evidence, and the only evidence, that such Note has been duly authenticated and delivered hereunder.
Section 2.4 AUTHENTICATING AGENT.
(a) Indenture Trustee, at the expense of Servicer, may appoint one or more authenticating agents with respect to the Notes which shall be authorized to act on behalf of Indenture Trustee in authenticating the Notes in connection with the issuance, delivery, registration of transfer, exchange or repayment of the Notes. Whenever reference is made in this Indenture to the authentication of Notes by Indenture Trustee or Indenture Trustee's certificate of authentication, such reference shall be deemed to include authentication on behalf of Indenture Trustee by an authenticating agent and a certificate of authentication executed on behalf of Indenture Trustee by an authenticating agent. Each authenticating agent must be acceptable to Issuer and 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 Indenture Trustee or such authenticating agent.
(c) An authenticating agent may at any time resign by giving written notice of resignation to Indenture Trustee, Issuer and Servicer. Indenture Trustee may at any time terminate the agency of an authenticating agent by giving notice of termination to such authenticating agent and to Issuer and Servicer. 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 Indenture Trustee or Issuer and Servicer, Indenture Trustee may promptly appoint a successor authenticating agent. Any successor authenticating agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an authenticating agent. No successor authenticating agent shall be appointed unless acceptable to Issuer and Servicer.
(d) Issuer agrees to pay to each authenticating agent from time to time reasonable compensation for its services under this SECTION 2.4.
(e) The provisions of SECTIONS 6.1 and 6.4 shall be applicable to any authenticating agent.
(f) Pursuant to an appointment made under this SECTION 2.4, the Notes may have endorsed thereon, in lieu of or in addition to Indenture Trustee's certificate of authentication, an alternative certificate of authentication in substantially the following form:
"This is one of the Notes described in the within-mentioned Agreement.
as Authenticating Agent
for Indenture Trustee
By: _____________________________
Authorized Signatory"
Dated: _________________________
Section 2.5 REGISTRATION OF AND LIMITATIONS ON TRANSFER AND EXCHANGE OF NOTES. Issuer shall cause to be kept a register (the "NOTE REGISTER") in which Issuer shall provide for the registration of Notes and the registration of transfers of Notes. Indenture Trustee initially shall be Transfer Agent and Registrar (in such capacity, the "TRANSFER AGENT AND REGISTRAR") for the purpose of registering Notes and transfers of Notes as herein provided. Upon any resignation of any Transfer Agent and Registrar, Issuer shall promptly appoint a successor or, if it elects not to make such an appointment, assume the duties of Transfer Agent and Registrar.
If a Person other than Indenture Trustee is appointed by Issuer as Transfer Agent and Registrar, Issuer will give Indenture Trustee prompt written notice of the appointment of a Transfer Agent and Registrar and of the location, and any change in the location, of Transfer Agent and Registrar and Note Register. Indenture Trustee shall have the right to inspect the Note Register at all reasonable times and to obtain copies thereof, and Indenture Trustee shall have the right to conclusively rely upon a certificate executed on behalf of Transfer Agent and Registrar by an officer thereof as to the names and addresses of the Noteholders and the principal amounts and numbers of such Notes.
Upon surrender for registration of transfer of any Note at the office or agency of Transfer Agent and Registrar, to be maintained as provided in SECTION 3.2, if the requirements of Section 8-401 of the UCC are met as certified by Administrator to Indenture Trustee, Issuer shall execute, and upon receipt of such surrendered Note Indenture Trustee shall authenticate and deliver to the Noteholder, in the name of the designated transferee or transferees, one or more new Notes (of the same Series and Class) in any authorized denominations of like aggregate principal amount.
At the option of a Noteholder, Notes may be exchanged for other Notes (of the same Series and Class) in any authorized denominations and of like aggregate principal amount, upon surrender of such Notes to be exchanged at the office or agency of Transfer Agent and Registrar. Whenever any Notes are so surrendered for exchange, if the requirements of Section 8-401 of the UCC are met as certified by Administrator to Indenture Trustee, Issuer shall execute, and upon receipt of such surrendered Note Indenture Trustee shall authenticate and deliver to the Noteholder, the Notes which the Noteholder making the exchange is entitled to receive.
All Notes issued upon any registration of transfer or exchange of Notes shall evidence the same obligations, evidence the same debt, and be entitled to the same rights and privileges under this Indenture, as the Notes surrendered upon such registration of transfer or exchange.
Every Note presented or surrendered for registration of transfer or exchange shall be duly endorsed by, or be accompanied by a written instrument of transfer in a form satisfactory to Indenture Trustee duly executed by, the Noteholder thereof or its attorney-in-fact duly authorized in writing, and by such other documents as Indenture Trustee may reasonably require.
Any Note held by Transferor at any time after the date of its initial issuance may be transferred or exchanged only upon the delivery to the Owner Trustee and Indenture 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.
The registration of transfer of any Note shall be subject to the additional requirements, if any, set forth in the related Indenture Supplement.
No service charge shall be made for any registration of transfer or exchange of Notes, but Issuer and Transfer Agent and Registrar may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of such Notes.
All Notes surrendered for registration of transfer and exchange shall be canceled by Issuer and delivered to Indenture Trustee for subsequent destruction without liability on the part of either. Indenture Trustee shall destroy the Global Note upon its exchange in full for Definitive Notes and shall deliver a certificate of destruction to Transferor. Such certificate shall also state that a certificate or certificates of each Foreign Clearing Agency referred to in the applicable Indenture Supplement was received with respect to each portion of the Global Note exchanged for Definitive Notes.
The preceding provisions of this SECTION 2.5 notwithstanding, Issuer shall not be required to make, and Transfer Agent and Registrar need not register, transfers or exchanges of Notes for a period of twenty (20) days preceding the due date for any payment with respect to the Note.
If and so long as any Series of Notes are listed on the Luxembourg Stock Exchange and such exchange shall so require, Issuer shall appoint a co-transfer agent and co-registrar in Luxembourg or another European city. Any reference in this Indenture to Transfer Agent and Registrar shall include any co-transfer agent and co-registrar unless the context otherwise requires. Indenture Trustee will enter into any appropriate agency agreement with any co-transfer agent and co-registrar not a party to this Indenture, which will implement the provisions of this Indenture that relate to such agent.
Notwithstanding any other provision of this Indenture, with respect to any
Notes for which an Opinion of Counsel has not been issued opining on the
treatment of such Notes as debt for federal income tax purposes, no transfer (or
purported transfer) of all or any part of such Notes (or any economic interest
therein) shall be effective, and any such transfer (or purported transfer) shall
be void AB INITIO, and no Person shall otherwise become a Holder of such Notes
if (i) at the time of transfer (or purported transfer) such Notes are traded on
an established securities market or readily tradeable on a secondary market or
(ii) after such transfer (or purported transfer) the Trust would have more than
95 Holders of such Notes and any other interests in the Trust for which an
Opinion of Counsel is not rendered in connection with the issuance of such
interest to the effect that such interest will be characterized as debt for
federal income tax purposes. For purposes of determining whether the Trust will
have more than 95 Holders, each Person indirectly owning an interest in the
Trust through a partnership (including an entity treated as a partnership for
federal income tax purposes), a grantor trust or an S corporation (each such
entity a "FLOW THROUGH ENTITY") shall be treated as a Holder unless the Trustee
determines in its sole discretion after consulting with qualified tax counsel,
that less than substantially all of the value of the beneficial owner's interest
in the flow-through entity is attributable to the flow-through entity's interest
(direct or indirect) in the Trust.
Section 2.6 MUTILATED, DESTROYED, LOST OR STOLEN NOTES. If (a) any mutilated Note is surrendered to Indenture Trustee, or Indenture Trustee receives evidence to its satisfaction of the destruction, loss or theft of any Note, and (b) in case of destruction, loss, or theft there is delivered to Indenture Trustee such security or indemnity as may be required by it to hold Issuer, the Noteholders, Indenture Trustee and Transfer Agent and Registrar harmless, then, in the absence of notice to Issuer, Transfer Agent and Registrar or Indenture Trustee that such Note has been acquired by a protected purchaser (as defined in Section 8-303 of the UCC as in effect in the State of Illinois), Issuer shall execute, and Indenture Trustee shall authenticate and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement Note of like tenor (including the same date of issuance) and principal amount, bearing a number not contemporaneously outstanding; PROVIDED, HOWEVER, that if any such mutilated, destroyed, lost or stolen Note shall have become or within seven (7) days shall be due and payable, or shall have been selected or called for redemption, instead of issuing a replacement Note, Issuer may pay such Note without surrender thereof, except that any mutilated Note shall be surrendered. If, after the delivery of such replacement Note or payment of a destroyed, lost or stolen Note pursuant to the
proviso to the preceding sentence, a protected purchaser (as defined in Section 8-303 of the UCC as in effect in the State of Illinois) of the original Note in lieu of which such replacement Note was issued presents for payment such original Note, Issuer and Indenture Trustee shall be entitled to recover such replacement Note (or such payment) from the Person to whom it was delivered or any Person taking such replacement Note from such Person to whom such replacement Note was delivered or any assignee of such Person, except a protected purchaser, and shall be entitled to recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or expense incurred by Issuer or Indenture Trustee in connection therewith.
Upon the issuance of any replacement Note under this SECTION 2.6, Issuer may require the payment by the Holder of such Note of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other reasonable expenses (including the fees and expenses of Indenture Trustee or Transfer Agent and Registrar) connected therewith.
Every replacement Note issued pursuant to this SECTION 2.6 in replacement of any mutilated, destroyed, lost or stolen Note shall constitute complete and indefeasible evidence of an obligation of the Trust, as if originally issued, whether or not the mutilated, destroyed, lost or stolen Note shall be found at any time, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Notes duly issued hereunder.
The provisions of this SECTION 2.6 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes.
Section 2.7 PERSONS DEEMED OWNERS. Prior to due presentment for registration of transfer of any Note, Issuer, Transferor, Indenture Trustee and any agent of Issuer, Transferor or Indenture Trustee shall treat the Person in whose name any Note is registered as the owner of such Note for the purpose of receiving distributions pursuant to the terms of the applicable Indenture Supplement and for all other purposes whatsoever, whether or not such Note is overdue, and neither Issuer, Transferor, Indenture Trustee nor any agent of Issuer, Transferor or Indenture Trustee shall be affected by any notice to the contrary.
Section 2.8 APPOINTMENT OF PAYING AGENT.
(a) Issuer reserves the right at any time to vary or terminate the appointment of a Paying Agent for the Notes, and to appoint additional or other Paying Agents, provided that it will at all times maintain Indenture Trustee as a Paying Agent.
If and so long as any Notes are listed on the Luxembourg Stock Exchange and such exchange shall so require, Issuer will appoint a co-paying agent in Luxembourg or another European city. Indenture Trustee will enter into any appropriate agency agreement with any co-paying agent not a party to this
Indenture, which will implement the provisions of this Indenture that relate to such agent.
Notice of all changes in the identity or specified office of a Paying Agent will be delivered promptly to the Noteholders by Indenture Trustee.
(b) Indenture Trustee shall cause each Paying Agent (other than itself) to execute and deliver to Indenture Trustee an instrument in which such Paying Agent shall agree with Indenture Trustee that such Paying Agent will hold all sums, if any, held by it for payment to the Noteholders in trust for the benefit of the Noteholders entitled thereto until such sums shall be paid to such Noteholders and shall agree, and if Indenture Trustee is Paying Agent it hereby agrees, that it shall comply with all requirements of the Code regarding the withholding by Indenture Trustee of payments in respect of federal income taxes due from the Note Owners.
Section 2.9 ACCESS TO LIST OF NOTEHOLDERS' NAMES AND ADDRESSES.
(a) Issuer will furnish or cause to be furnished to Indenture Trustee, Servicer or Paying Agent, within five (5) Business Days after receipt by Issuer of a written request therefor from Indenture Trustee, Servicer or Paying Agent, respectively, a list of the names and addresses of the Noteholders. Unless otherwise provided in the related Indenture Supplement, the Holders of not less than 10% of the principal balance of the Outstanding Notes of any Series (the "APPLICANTS") may apply in writing to Indenture Trustee, and if such application states that the Applicants desire to communicate with other Noteholders of any Series with respect to their rights under this Indenture or under the Notes and is accompanied by a copy of the communication which such Applicants propose to transmit, then Indenture Trustee, after having been adequately indemnified by such Applicants for its costs and expenses, shall afford or shall cause Transfer Agent and Registrar to afford such Applicants access during normal business hours to the most recent list of Noteholders held by Indenture Trustee and shall give Servicer notice that such request has been made, within five (5) Business Days after the receipt of such application. Such list shall be as of a date no more than forty-five (45) days prior to the date of receipt of such Applicants' request.
(b) Every Noteholder, by receiving and holding a Note, agrees that none of Issuer, Indenture Trustee, Transfer Agent and Registrar and Servicer or any of their respective agents and employees shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the Noteholders hereunder, regardless of the sources from which such information was derived.
Section 2.10 CANCELLATION. All Notes surrendered for payment, registration of transfer, exchange or redemption shall, if surrendered to any Person other than Indenture Trustee, be delivered to Indenture Trustee and shall be promptly canceled by it. Issuer may at any time deliver to Indenture Trustee for cancellation any Notes previously authenticated and delivered hereunder which Issuer may have acquired in any lawful manner whatsoever, and all Notes
so delivered shall be promptly canceled by Indenture Trustee. No Notes shall be authenticated in lieu of or in exchange for any Notes canceled as provided in this SECTION 2.10, except as expressly permitted by this Indenture. All canceled Notes held by Indenture Trustee shall be disposed of by it in its customary manner unless Issuer shall direct Indenture Trustee in a timely manner that they be returned to Issuer.
Section 2.11 NEW ISSUANCES.
(a) Pursuant to one or more Indenture Supplements, Transferor may from time to time direct the Owner Trustee, on behalf of Issuer, to issue one or more new Series of Notes (a "NEW ISSUANCE"). The Notes of all outstanding Series shall be equally and ratably entitled as provided herein to the benefits of this Indenture without preference, priority or distinction, all in accordance with the terms and provisions of this Indenture and the applicable Indenture Supplement except, with respect to any Series or Class, as provided in the related Indenture Supplement. Interest on and principal of the Notes of each outstanding Series shall be paid as specified in the Indenture Supplement relating to such outstanding Series.
(b) On or before the Closing Date relating to any new Series of Notes, the parties hereto will execute and deliver an Indenture Supplement which will specify the Principal Terms of such Series. The terms of such Indenture Supplement may modify or amend the terms of this Indenture solely as applied to such new Series. The obligation of the Owner Trustee to execute, on behalf of Issuer, the Notes of any Series and of Indenture Trustee to authenticate such Notes (other than any Series issued pursuant to an Indenture Supplement dated as of the date hereof) and to execute and deliver the related Indenture Supplement is subject to the satisfaction of the following conditions:
(i) on or before the fifth Business Day immediately preceding the Closing Date Transferor shall have given the Owner Trustee, Indenture Trustee, Servicer and each Rating Agency notice (unless such notice requirement is otherwise waived) of such issuance and the Closing Date;
(ii) Transferor shall have delivered to the Owner Trustee and Indenture Trustee any related Indenture Supplement, in form satisfactory to the Owner Trustee and Indenture Trustee, executed by each party hereto (other than Indenture Trustee);
(iii) Transferor shall have delivered to the Owner Trustee and Indenture Trustee any related Enhancement Agreement executed by Transferor and the Enhancement Provider;
(iv) the Rating Agency Condition shall have been satisfied with respect to such issuance;
(v) Transferor shall have delivered to the Owner Trustee and Indenture Trustee an Officer's Certificate, dated the Closing Date to the
effect that Transferor reasonably believes that such issuance will not, based on the facts known to such officer at the time of such certification have an Adverse Effect;
(vi) Transferor shall have delivered to the Owner Trustee and Indenture Trustee (with a copy to each Rating Agency) a Tax Opinion, dated the Closing Date with respect to such issuance;
(vii) Transferor shall have delivered to the Owner Trustee and Indenture Trustee an Officer's Certificate stating that (A) Transferor Amount shall not be less than the Minimum Transferor Amount and (B) the Aggregate Principal Balance shall not be less than the Required Principal Balance, in each case as of the Closing Date and after giving effect to such issuance; and
(viii) unless Certificate Trust has terminated, all of the conditions set forth in Section 6.3 of the Pooling and Servicing Agreement have been met.
(c) Upon satisfaction of the above conditions, pursuant to SECTION 2.3, the Owner Trustee, on behalf of Issuer, shall execute and Indenture Trustee shall upon written direction of Issuer authenticate and deliver the Notes of such Series as provided in this Indenture and the applicable Indenture Supplement.
(d) Issuer may direct Indenture Trustee in writing to deposit the net proceeds from any New Issuance in the Excess Funding Account. Issuer may also specify that on any Transfer Date the proceeds from the sale of any new Series may be withdrawn from the Excess Funding Account and treated as Shared Principal Collections.
Section 2.12 BOOK-ENTRY NOTES. Unless otherwise provided in any related Indenture Supplement, the Notes, upon original issuance, shall be issued in the form of typewritten or printed Notes representing the Book-Entry Notes to be delivered to the depository specified in such Indenture Supplement which shall be the Clearing Agency or Foreign Clearing Agency, by or on behalf of such Series.
The Notes of each Series shall, unless otherwise provided in the related Indenture Supplement, initially be registered in the Note Register in the name of the nominee of the Clearing Agency or Foreign Clearing Agency for such Book-Entry Notes and shall be delivered to Indenture Trustee or, pursuant to such Clearing Agency's or Foreign Clearing Agency's instructions held by Indenture Trustee's agent as custodian for the Clearing Agency or Foreign Clearing Agency.
Unless and until Definitive Notes are issued under the limited circumstances described in SECTION 2.14, no Note Owner shall be entitled to receive a Definitive Note representing such Note Owner's interest in such Note. Unless and until Definitive Notes have been issued to the Note Owners pursuant to SECTION 2.14:
(a) the provisions of this SECTION 2.12 shall be in full force and effect with respect to each such Series;
(b) Indenture Trustee shall be entitled to deal with the Clearing Agency or Foreign Clearing Agency and the Clearing Agency Participants for all purposes of this Indenture (including the payment of principal of and interest on the Notes of each such Series) as the authorized representatives of the Note Owners;
(c) to the extent that the provisions of this SECTION 2.12 conflict with any other provisions of this Indenture, the provisions of this SECTION 2.12 shall control with respect to each such Series;
(d) the rights of Note Owners of each such Series shall be exercised only through the Clearing Agency or Foreign Clearing Agency and the applicable Clearing Agency Participants and shall be limited to those established by law and agreements between such Note Owners and the Clearing Agency or Foreign Clearing Agency and/or the Clearing Agency Participants. Pursuant to the depository agreement applicable to a Series, unless and until Definitive Notes of such Series are issued pursuant to SECTION 2.14, the initial Clearing Agency shall make book-entry transfers among the Clearing Agency Participants and receive and transmit distributions of principal and interest on the Notes to such Clearing Agency Participants; and
(e) whenever this Indenture requires or permits actions to be taken based upon instructions or directions of the Holders of Notes representing a specified percentage of the Outstanding Amount, the Clearing Agency or Foreign Clearing Agency shall be deemed to represent such percentage only to the extent that they have received instructions to such effect from the Note Owners and/or Clearing Agency Participants owning or representing, respectively, such required percentage of the beneficial interest in the Notes and has delivered such instructions to Indenture Trustee.
Section 2.13 NOTICES TO CLEARING AGENCY OR FOREIGN CLEARING AGENCY. Whenever a notice or other communication to the Noteholders is required under this Indenture, unless and until Definitive Notes shall have been issued to Note Owners pursuant to SECTION 2.14, Indenture Trustee shall give all such notices and communications specified herein to be given to Noteholders to the Clearing Agency or Foreign Clearing Agency, as applicable, and shall have no obligation to the Note Owners.
Section 2.14 DEFINITIVE NOTES. If (i) (A) Transferor advises Indenture Trustee in writing that the Clearing Agency is no longer willing or able to discharge properly its responsibilities as Clearing Agency with respect to the Book-Entry Notes of a given Class or Series and (B) Indenture Trustee or Issuer is unable to locate and reach an agreement on satisfactory terms with a qualified successor, (ii) Transferor, at its option, advises Indenture Trustee in writing that it elects to terminate the book-entry system through the Clearing Agency with respect to such Class or Series or (iii) after the occurrence of a Servicer Default,
Note Owners of Notes evidencing more than 50% of the principal balance of the Outstanding Notes (or such other percentage as specified in the related Indenture Supplement) of such Class or Series, as applicable, advise Indenture Trustee and the applicable Clearing Agency through the applicable Clearing Agency Participants in writing that the continuation of a book-entry system is no longer in the best interests of the Note Owners of such Class or Series, the Clearing Agency shall notify all Note Owners of such Class or Series of the occurrence of such event and of the availability of Definitive Notes to Note Owners of such Class or Series requesting the same. Upon surrender to Indenture Trustee of the Notes of such Class or Series, accompanied by registration instructions from the applicable Clearing Agency, Issuer shall execute and Indenture Trustee shall authenticate Definitive Notes of such Class or Series and shall recognize the registered holders of such Definitive Notes as Noteholders under this Indenture. Neither Issuer nor Indenture Trustee shall be liable for any delay in delivery of such instructions, and Issuer and Indenture Trustee may conclusively rely on, and shall be fully protected in relying on, such instructions. Upon the issuance of Definitive Notes of such Class or Series, all references herein to obligations imposed upon or to be performed by the applicable Clearing Agency or Foreign Clearing Agency shall be deemed to be imposed upon and performed by Indenture Trustee, to the extent applicable with respect to such Definitive Notes, and Indenture Trustee shall recognize the registered holders of the Definitive Notes of such Class or Series as Noteholders of such Class or Series hereunder. Definitive Notes will be transferable and exchangeable at the offices of Transfer Agent and Registrar.
Section 2.15 GLOBAL NOTE. If specified in the related Indenture Supplement for any Series, Notes may be initially issued in the form of a single temporary Global Note (the "GLOBAL NOTE") in bearer form, without interest coupons, in the denomination of the initial principal amount and substantially in the form attached to the related Indenture Supplement. Unless otherwise specified in the related Indenture Supplement, the provisions of this SECTION 2.15 shall apply to such Global Note. The Global Note will be authenticated by Indenture Trustee upon the same conditions, in substantially the same manner and with the same effect as the Definitive Notes. The Global Note may be exchanged in the manner described in the related Indenture Supplement for Registered Notes or Bearer Notes in definitive form. Except as otherwise specifically provided in the Indenture Supplement, any Notes that are issued in bearer form pursuant to this Indenture shall be issued in accordance with the requirements of Code section 163(f)(2).
Section 2.16 MEETINGS OF NOTEHOLDERS. To the extent provided by the Indenture Supplement for any Series issued in whole or in part in Bearer Notes, Servicer or Indenture Trustee may at any time call a meeting of the Noteholders of such Series, to be held at such time and at such place as Servicer and Indenture Trustee, as the case may be, shall determine, for the purpose of approving a modification or amendment to, or obtaining a waiver of, any covenant or condition set forth in this Indenture with respect to such Series or in the Notes of such Series, subject to ARTICLE X.
Section 2.17 UNCERTIFICATED CLASSES. Notwithstanding anything to the contrary contained in this ARTICLE II or in ARTICLE XI, unless otherwise specified in any Indenture Supplement, any provisions contained in this ARTICLE II and in ARTICLE XI relating to the registration, form, execution, authentication, delivery, presentation, cancellation and surrender of Notes shall not be applicable to any uncertificated Notes, PROVIDED, HOWEVER, that, except as otherwise specifically provided in the Indenture Supplement, any such uncertificated Notes shall be issued in "registered form" within the meaning of Code section 163(f)(1).
ARTICLE III
REPRESENTATIONS AND COVENANTS OF ISSUER
Section 3.1 PAYMENT OF PRINCIPAL AND INTEREST.
(a) Issuer will duly and punctually pay principal and interest in accordance with the terms of the Notes as specified in the relevant Indenture Supplement.
(b) The Noteholders of a Series as of the Record Date in respect of a Distribution Date shall be entitled to the interest accrued and payable and principal payable on such Distribution Date as specified in the related Indenture Supplement. All payment obligations under a Note are discharged to the extent such payments are made to the Noteholder of record.
Section 3.2 MAINTENANCE OF OFFICE OR AGENCY. Issuer will maintain an office or agency within the State of New York and such other locations as may be set forth in an Indenture Supplement where Notes may be presented or surrendered for payment, where Notes may be surrendered for registration of transfer or exchange and where notices and demands to or upon Issuer in respect of the Notes and this Indenture may be served. Issuer hereby initially appoints Indenture Trustee at its Corporate Trust Office to serve as its agent for the foregoing purposes. Issuer will give prompt written notice to Indenture Trustee and the Noteholders of the location, and of any change in the location, of any such office or agency. If at any time Issuer shall fail to maintain any such office or agency or shall fail to furnish Indenture Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office, and Issuer hereby appoints Indenture Trustee at its Corporate Trust Office as its agent to receive all such presentations, surrenders, notices and demands.
Section 3.3 MONEY FOR NOTE PAYMENTS TO BE HELD IN TRUST. As specified in
SECTION 8.3 herein and in the related Indenture Supplement, all payments of
amounts due and payable with respect to the Notes which are to be made from
amounts withdrawn from the Collection Account and the Excess Funding Account
shall be made on behalf of Issuer by Indenture Trustee or by Paying Agent, and
no amounts so withdrawn from the Collection Account or the Excess Funding
Account shall be paid over to or at the direction of Issuer except as provided
in this SECTION 3.3 and in the related Indenture Supplement.
Whenever Issuer shall have a Paying Agent in addition to Indenture Trustee, it will, on or before the Business Day next preceding each Distribution Date, direct Indenture Trustee to deposit with such Paying Agent on or before such Distribution Date an aggregate sum sufficient to pay the amounts then becoming due, such sum to be (i) held in trust for the benefit of Persons entitled thereto and (ii) invested, pursuant to an Issuer Order, by Paying Agent in Eligible Investments in accordance with the terms of the related Indenture Supplement. For all investments made by a Paying Agent under this Section 3.3, such Paying Agent shall be entitled to all of the rights and obligations of Indenture Trustee under the related Indenture Supplement, such rights and obligations being incorporated in this paragraph by this reference.
Issuer will cause each Paying Agent other than Indenture Trustee to execute and deliver to Indenture Trustee an instrument in which such Paying Agent shall agree with Indenture Trustee (and if Indenture Trustee acts as Paying Agent, it hereby so agrees), subject to the provisions of this SECTION 3.3, that such Paying Agent, in acting as Paying Agent, is an express agent of Issuer and, further, that such Paying Agent will:
(i) hold all sums held by it for the payment of amounts due with respect to the Notes in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided and pay such sums to such Persons as herein provided;
(ii) give a Trustee Officer of Indenture Trustee written notice of any default by Issuer (or any other obligor upon the Notes) of which it has actual knowledge in the making of any payment required to be made with respect to the Notes;
(iii) at any time during the continuance of any such default, upon the written request of Indenture Trustee, forthwith pay to Indenture Trustee all sums so held in trust by such Paying Agent;
(iv) immediately resign as a Paying Agent and forthwith pay to Indenture Trustee all sums held by it in trust for the payment of Notes if at any time it ceases to meet the standards required to be met by a Paying Agent at the time of its appointment; and
(v) comply with all requirements of the Code with respect to the withholding from any payments made by it on any Notes of any applicable withholding taxes imposed thereon and with respect to any applicable reporting requirements in connection therewith.
Issuer may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, by Issuer Order direct any Paying Agent to pay to Indenture Trustee all sums held in trust by such Paying Agent, such sums to be held by Indenture Trustee upon the same trusts as those upon which such sums were held by such Paying Agent; and upon such payment
by any Paying Agent to Indenture Trustee, such Paying Agent shall be released from all further liability with respect to such sums.
Section 3.4 EXISTENCE. Issuer will keep in full effect its existence, rights and franchises as a business trust under the laws of the State of Delaware (unless it becomes, or any successor Issuer hereunder is or becomes, organized under the laws of any other State or of the United States of America, in which case Issuer will keep in full effect its existence, rights and franchises under the laws of such other jurisdiction) 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 Indenture, the Notes, the Collateral and each other related instrument or agreement.
Section 3.5 PROTECTION OF COLLATERAL. Issuer will from time to time prepare, or cause to be prepared, execute and deliver all such supplements and amendments hereto and all such financing statements, continuation statements, instruments of further assurance and other instruments, and will take such other action necessary or advisable to:
(a) grant more effectively all or any portion of the Collateral as security for the Notes;
(b) maintain or preserve the lien (and the priority thereof) of this Indenture or to carry out more effectively the purposes hereof;
(c) perfect, publish notice of, or protect the validity of any Grant made or to be made under this Indenture;
(d) enforce any of the Collateral; or
(e) preserve and defend title to the Collateral securing the Notes and the rights therein of Indenture Trustee and the Noteholders secured thereby against the claims of all Persons and parties.
Issuer hereby designates Indenture Trustee its agent and attorney-in-fact to execute any financing statement, continuation statement or other instrument required pursuant to this SECTION 3.5 and provided to it.
Issuer shall pay or cause to be paid any taxes levied on all or any part of the Collateral securing the Notes.
Section 3.6 OPINIONS AS TO COLLATERAL.
(a) On the Closing Date relating to any new Series of Notes, Issuer shall furnish to Indenture Trustee an Opinion of Counsel (with a copy to each Rating Agency) either stating that, in the opinion of such counsel, such action has been taken to perfect the lien and security interest of this Indenture, including with respect to the recording and filing of this Indenture, any indentures supplemental hereto, and any other requisite documents, and with respect to the
execution and filing of any financing statements and continuation statements, as are so necessary and reciting the details of such action, or stating that, in the opinion of such counsel, no such action is necessary to maintain the perfection of such lien and security interest.
(b) On or before May 30 in each calendar year, beginning in 2002, Issuer shall furnish to Indenture Trustee an Opinion of Counsel satisfactory to the Rating Agencies either stating that, in the opinion of such counsel, such action has been taken to perfect the lien and security interest of this Indenture, including with respect to the recording, filing, re-recording and refiling of this Indenture, any indentures supplemental hereto and any other requisite documents and with respect to the execution and filing of any financing statements and continuation statements as is so necessary and reciting the details of such action or stating that in the opinion of such counsel no such action is necessary to maintain the perfection of such lien and security interest. Such Opinion of Counsel shall also describe the recording, filing, re-recording and refiling of this Indenture, any indentures supplemental hereto and any other requisite documents and the execution and filing of any financing statements and continuation statements that will, in the opinion of such counsel, be required to maintain the perfection of the lien and security interest of this Indenture until May 30 in the following calendar year.
Section 3.7 PERFORMANCE OF OBLIGATIONS; SERVICING OF RECEIVABLES.
(a) Issuer will not take any action and will use its best efforts not to permit any action to be taken by others that would release any Person from any of such Person's material covenants or obligations under any instrument or agreement included in the Collateral or that would result in the amendment, hypothecation, subordination, termination or discharge of, or impair the validity or effectiveness of, any such instrument or agreement, except as expressly provided in this Indenture, the Pooling and Servicing Agreement, the Transfer and Servicing Agreement or such other instrument or agreement.
(b) Issuer may contract with other Persons to assist it in performing its duties under this Indenture, and any performance of such duties by a Person identified to Indenture Trustee in an Officer's Certificate of Issuer shall be deemed to be action taken by Issuer. Initially, Issuer has contracted with Administrator to assist Issuer in performing its duties under this Indenture.
(c) Issuer will punctually perform and observe all of its obligations and agreements contained in this Indenture, the other Transaction Documents and in the instruments and agreements relating to the Collateral, including but not limited to filing or causing to be filed all UCC financing statements and continuation statements required to be filed by the terms of this Indenture and the Transfer and Servicing Agreement in accordance with and within the time periods provided for herein and therein.
(d) If Issuer shall have knowledge of the occurrence of a Servicer Default under the Transfer and Servicing Agreement, Issuer shall cause Indenture
Trustee to promptly notify the Rating Agencies thereof, and shall cause Indenture Trustee to specify in such notice the action, if any, being taken with respect to such default. If a Servicer Default shall arise from the failure of Servicer to perform any of its duties or obligations under the Transfer and Servicing Agreement with respect to the Receivables, Issuer shall take all reasonable steps available to it to remedy such failure.
(e) On and after the receipt by Servicer of a Termination Notice pursuant
to SECTION 7.1 of the Transfer and Servicing Agreement, Servicer shall continue
to perform all servicing functions under the Transfer and Servicing Agreement
until the date specified in the Termination Notice or until a date mutually
agreed upon by Servicer and Indenture Trustee. As promptly as possible after the
giving of a Termination Notice to Servicer, Indenture Trustee shall appoint a
Successor Servicer, and such Successor Servicer shall accept its appointment by
a written assumption. In the event that a Successor Servicer has not been
appointed and accepted its appointment at the time when Servicer ceases to act
as Servicer, Indenture Trustee in accordance with SECTION 7.2 of the Transfer
and Servicing Agreement without further action shall automatically be appointed
the Successor Servicer. Indenture Trustee may delegate any of its servicing
obligations to an Affiliate or agent in accordance with SECTION 3.1(b) and
SECTION 5.7 of the Transfer and Servicing Agreement. Notwithstanding the
foregoing, Indenture Trustee shall, if it is legally unable so to act, petition
at the expense of Servicer a court of competent jurisdiction to appoint any
established institution qualifying as an Eligible Servicer as the Successor
Servicer. Indenture Trustee shall give prompt notice to each Rating Agency and
each Enhancement Provider upon the appointment of a Successor Servicer. Upon its
appointment, the Successor Servicer shall be the successor in all respects to
Servicer with respect to servicing functions under the Transfer and Servicing
Agreement and shall be subject to all the responsibilities, duties and
liabilities relating thereto placed on Servicer by the terms and provisions
thereof, and all references in this Indenture to Servicer shall be deemed to
refer to the Successor Servicer. In connection with any Termination Notice,
Indenture 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 for servicing compensation, subject to the limitations set
forth in SECTION 7.2 of the Transfer and Servicing Agreement. Notwithstanding
anything else herein to the contrary, in no event shall Indenture Trustee be
liable for any servicing fee.
(f) Without derogating from the absolute nature of the assignment granted to Indenture Trustee under this Indenture or the rights of Indenture Trustee hereunder, Issuer agrees (i) that it will not, without the prior written consent of Indenture Trustee and Noteholders holding a majority of the Outstanding Amount of the Notes of each Series, amend, modify, waive, supplement, terminate or surrender, or agree to any amendment, modification, supplement, termination, waiver or surrender of, the terms of any Collateral (except to the extent otherwise provided in the Transfer and Servicing Agreement) or the Transaction Documents (except to the extent otherwise provided in the Transaction Documents), or waive timely performance or
observance by Servicer or Transferor of their respective obligations under the Transfer and Servicing Agreement; and (ii) that any such amendment shall not (A) increase or reduce in any manner the amount of, or accelerate or delay the timing of, distributions that are required to be made for the benefit of the Noteholders or (B) reduce the aforesaid percentage of the Notes that is required to consent to any such amendment, without the consent of the Holders of all the Outstanding Notes. If any such amendment, modification, supplement or waiver shall be so consented to by Indenture Trustee and such Noteholders, Issuer agrees, to execute and deliver, in its own name and at its own expense, such agreements, instruments, consents and other documents as are necessary or appropriate in the circumstances.
Section 3.8 NEGATIVE COVENANTS. So long as any Notes are Outstanding, Issuer will not:
(a) sell, transfer, exchange, or otherwise dispose of any part of the Collateral unless directed to do so by Indenture Trustee, except as expressly permitted by this Indenture and any Indenture Supplement, the Trust Agreement or the Transfer and Servicing Agreement;
(b) claim any credit on, or make any deduction from, the principal and interest payable in respect of the Notes (other than amounts properly withheld from such payments under the Code or applicable state law) or assert any claim against any present or former Noteholder by reason of the payment of any taxes levied or assessed upon any part of the Collateral;
(c) incur, assume, guarantee or otherwise become liable, directly or indirectly, for any indebtedness other than incurred under the Notes and this Indenture;
(d) (i) permit the validity or effectiveness of this Indenture to be impaired, or permit the lien of this Indenture to be amended, hypothecated, subordinated, terminated or discharged, or permit any Person to be released from any covenants or obligations with respect to the Notes under this Indenture except as may be expressly permitted hereby, (ii) permit any Lien, charge, excise, claim, security interest, mortgage or other encumbrance (other than the lien of this Indenture) to be created on or extend to or otherwise arise upon or burden the Collateral or any part thereof or any interest therein or the proceeds thereof or (iii) permit the lien of this Indenture not to constitute a valid first priority security interest (other than with respect to a tax, mechanics, or similar lien) in the Collateral; or
(e) voluntarily dissolve or liquidate in whole or in part.
Section 3.9 STATEMENTS AS TO COMPLIANCE. Issuer will deliver to Indenture Trustee and the Rating Agencies, within 120 days after the end of each fiscal year of Issuer at the end of which any Notes are outstanding (commencing within 120 days after the end of the fiscal year 2001), an Officer's Certificate stating, as to the Authorized Officer signing such Officer's Certificate, that
(i) a review of the activities of Issuer during the 12-month period ending at the end of such fiscal year and of performance under this Indenture has been made under such Authorized Officer's supervision, and
(ii) to the best of such Authorized Officer's knowledge, based on such review, Issuer has complied with all conditions and covenants under this Indenture throughout such year, or, if there has been a default in the compliance of any such condition or covenant, specifying each such default known to such Authorized Officer and the nature and status thereof.
Section 3.10 ISSUER MAY CONSOLIDATE, ETC., ONLY ON CERTAIN TERMS.
(a) Issuer shall not consolidate or merge with or into any other Person, unless:
(1) the Person (if other than Issuer) formed by or surviving such consolidation or merger (the "SURVIVING PERSON") (i) is organized and existing under the laws of the United States of America or any state or the District of Columbia, (ii) is not subject to regulation as an "investment company" under the Investment Company Act and (iii) expressly assumes, by an indenture supplemental hereto, executed and delivered to Indenture Trustee, in a form satisfactory to Indenture Trustee, the obligation to make due and punctual payment of the principal of and interest on all Notes and the performance of every covenant of this Indenture on the part of Issuer to be performed or observed;
(2) immediately after giving effect to such transaction, no Event of Default or Early Amortization Event shall have occurred and be continuing;
(3) Issuer shall have delivered to Indenture Trustee an
Officer's Certificate and an Opinion of Counsel each stating that
(i) such consolidation or merger and such supplemental indenture
comply with this SECTION 3.10, (ii) all conditions precedent
provided for in this SECTION 3.10 relating to such transaction have
been complied with (including any filing required by the Exchange
Act), and (iii) such supplemental indenture is duly authorized,
executed and delivered and is valid, binding and enforceable against
the Surviving Person;
(4) the Rating Agency Condition shall have been satisfied with respect to such transaction;
(5) Issuer shall have received a Tax Opinion with respect to such consolidation or merger; and
(6) any action that is necessary to maintain the lien and security interest created by this Indenture shall have been taken.
For the avoidance of doubt, this SECTION 3.10 shall not apply to the transfer of the Receivables and other assets to Issuer on Certificate Trust Termination Date.
(b) Issuer shall not convey or transfer any of its properties or assets, including those included in the Collateral, substantially as an entirety to any Person, unless:
(1) the Person that acquires by conveyance or transfer the properties and assets of Issuer the conveyance or transfer of which is hereby restricted (the "ACQUIRING PERSON") (A) is a United States citizen or a Person organized and existing under the laws of the United States of America or any state, or the District of Columbia, (B) is not subject to regulation as an "investment company" under the Investment Company Act, (C) expressly assumes, by an indenture supplemental hereto, executed and delivered to Indenture Trustee, in form satisfactory to Indenture Trustee, the obligation to make due and punctual payments of the principal of and interest on all Notes and the performance of every covenant of this Indenture on the part of Issuer to be performed or observed, (D) expressly agrees by means of such supplemental indenture that all right, title and interest so conveyed or transferred shall be subject and subordinate to the rights of Holders of the Notes, (E) unless otherwise provided in such supplemental indenture, expressly agree to indemnify, defend and hold harmless Issuer against and from any loss, liability or expense arising under or related to this Indenture and the Notes and (F) expressly agrees by means of such supplemental indenture that such Person (or if a group of Persons, then one specified Person) shall make all filings with the Commission (and any other appropriate Person) required by the Exchange Act in connection with the Notes;
(2) immediately after giving effect to such transaction, no Event of Default or Early Amortization Event shall have occurred and be continuing;
(3) the Rating Agency Condition shall have been satisfied with respect to such transaction;
(4) Issuer shall have received a Tax Opinion with respect to such transaction;
(5) any action that is necessary to maintain the lien and security interest created by this Indenture shall have been taken; and
(6) Issuer shall have delivered to Indenture Trustee an
Officer's Certificate and an Opinion of Counsel each stating that
(i) such conveyance or transfer and such supplemental indenture
comply with this SECTION 3.10, (ii) all conditions precedent herein
provided for relating to such transaction have been complied with
(including any filing required by the Exchange Act), and (iii) such
supplemental indenture is duly authorized, executed and delivered
and is valid, binding and enforceable against the Acquiring Person.
Section 3.11 SUCCESSOR SUBSTITUTED. Upon any consolidation or merger, or any conveyance or transfer of the properties and assets of Issuer substantially as an entirety in accordance with SECTION 3.10, the Surviving Person or the Acquiring Person, as the case may be, shall succeed to, and be substituted for, and may exercise every right and power of, Issuer under this Indenture with the same effect as if such Person had been named as Issuer herein. In the event of any such conveyance or transfer, the Person named as Issuer in the first paragraph of this Indenture or any successor which shall theretofore have become such in the manner prescribed in this SECTION 3.11 shall be released from its obligations under this Indenture as issued immediately upon the effectiveness of such conveyance or transfer, provided that Issuer shall not be released from any obligations or liabilities to Indenture Trustee or the Noteholders arising prior to such effectiveness.
Section 3.12 NO OTHER BUSINESS. Issuer shall not engage in any business other than the activities set forth in Section 2.3 of the Trust Agreement.
Section 3.13 INVESTMENTS. Except as contemplated by this Indenture or the Transfer and Servicing Agreement, Issuer shall not own, purchase, repurchase or acquire (or agree contingently to do so) any stock, obligations, assets or securities of, or any other interest in, or make any capital contribution to, any other Person.
Section 3.14 CAPITAL EXPENDITURES. Issuer shall not make any expenditure (by long-term or operating lease or otherwise) for capital assets (either realty or personalty).
Section 3.15 REMOVAL OF ADMINISTRATOR. So long as any Notes are outstanding, Issuer shall not remove Administrator without cause unless the Rating Agency Condition shall have been satisfied in connection with such removal.
Section 3.16 RESTRICTED PAYMENTS. Issuer shall not, directly or indirectly, (i) pay any dividend or make any distribution (by reduction of capital or otherwise), whether in cash, property, securities or a combination thereof, to the Owner Trustee or any owner of a beneficial interest in Issuer or otherwise with respect to any ownership or equity interest or security in or of Issuer or to Servicer, (ii) redeem, purchase, retire or otherwise acquire for value any such ownership or equity interest or security or (iii) set aside or otherwise segregate any amounts for any such purpose; PROVIDED, HOWEVER, that Issuer may make, or
cause to be made, (x) distributions as contemplated by, and to the extent funds are available for such purpose under, the Transaction Documents and (y) payments to Indenture Trustee pursuant to SECTION 6.7. Issuer will not, directly or indirectly, make payments to or distributions from the Collection Account except in accordance with the Transaction Documents.
Section 3.17 NOTICE OF EVENTS OF DEFAULT. Issuer agrees to give a Trustee Officer of Indenture Trustee and the Rating Agencies prompt written notice of each Event of Default hereunder, written notice of each default on the part of Servicer or Transferor of its obligations under the Transfer and Servicing Agreement and each default on the part of RPA Seller of its obligations under the Receivables Purchase Agreement, immediately after obtaining knowledge thereof.
Section 3.18 DERIVATIVE FINANCIAL INVESTMENTS. Issuer shall not hold any derivative financial instrument unless such derivative financial instrument complies with the requirements of paragraph 40 of Statement of Financial Accounting Standards No. 140 issued by the Financial Accounting Standards Board, including any interpretations thereof or any successor regulations issued by the Financial Accounting Standards Board.
Section 3.19 FURTHER INSTRUMENTS AND ACTS. Issuer will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture.
Section 3.20 PERFECTION REPRESENTATIONS AND WARRANTIES. The parties hereto agree that the representations, warranties and covenants set forth in Schedule I shall be a part of this Indenture for all purposes.
ARTICLE IV
SATISFACTION AND DISCHARGE
Section 4.1 SATISFACTION AND DISCHARGE OF THIS INDENTURE. This Indenture shall cease to be of further effect with respect to the Notes except as to (a) rights of registration of transfer and exchange, (b) substitution of mutilated, destroyed, lost or stolen Notes, (c) the rights of Noteholders to receive payments of principal thereof and interest thereon, (d) SECTIONS 3.3, 3.7, 3.8, 3.11, 3.12 and 12.16, (e) the rights and immunities of Indenture Trustee hereunder, including the rights of Indenture Trustee under SECTION 6.7, and the obligations of Indenture Trustee under SECTION 4.2, and (f) the rights of Noteholders as beneficiaries hereof with respect to the property so deposited with Indenture Trustee and payable to all or any of them, and Indenture Trustee, on written demand of and at the expense of Issuer, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture with respect to the Notes when:
(i) either
(A) all Notes theretofore authenticated and delivered (other than (1) Notes which have been destroyed,
lost or stolen and which have been replaced, or paid as provided in SECTION 2.6, and (2) Notes for whose full payment Issuer has theretofore deposited money in trust, which money has thereafter been repaid to Issuer or discharged from such trust, as provided in SECTION 3.3) have been delivered to Indenture Trustee for cancellation; or
(B) all Notes not theretofore delivered to Indenture Trustee for cancellation:
(1) have become due and payable;
(2) will become due and payable at the Series Termination Date for such Class or Series of Notes; or
(3) are to be called for redemption within one year under arrangements satisfactory to Indenture Trustee for the giving of notice of redemption by Indenture Trustee in the name, and at the expense, of Issuer;
(4) and Issuer, in the case of (1), (2) or (3) above, has irrevocably deposited or caused to be irrevocably deposited with Indenture Trustee cash or direct obligations of or obligations guaranteed by the United States of America (which will mature prior to the date such amounts are payable), in trust for such purpose, in an amount sufficient to pay and discharge the entire indebtedness on such Notes not theretofore delivered to Indenture Trustee for cancellation when due at the Series Termination Date for such Class or Series of Notes or the Redemption Date (if Notes shall have been called for redemption pursuant to the related Indenture Supplement), as the case may be;
(ii) Issuer has paid or caused to be paid all other sums payable hereunder by Issuer; and
(iii) Issuer has delivered to Indenture Trustee an Officer's Certificate, an Opinion of Counsel and (if required by the TIA or Indenture Trustee) an Independent Certificate from a firm of certified public accountants, each meeting the applicable requirements of SECTION 12.1(a) and each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the obligations of Issuer to Indenture Trustee under SECTION 6.7 and of Indenture Trustee to the Noteholders under SECTION 4.2 shall survive such satisfaction and discharge.
Section 4.2 APPLICATION OF ISSUER MONEY. All monies deposited with Indenture Trustee pursuant to SECTION 4.1 shall be held in trust and applied by it, in accordance with the provisions of the Notes, this Indenture and the applicable Indenture Supplement, to make payments, either directly or through any Paying Agent to the Noteholders and for the payment in respect of which such monies have been deposited with Indenture Trustee, of all sums due and to become due thereon for principal and interest; but such monies need not be segregated from other funds except to the extent required herein or in the Transfer and Servicing Agreement or required by law.
ARTICLE V
EARLY AMORTIZATION EVENTS, DEFAULTS AND REMEDIES
Section 5.1 EARLY AMORTIZATION EVENTS. If any one of the following events (each, a "TRUST EARLY AMORTIZATION EVENT") shall occur:
(a) the occurrence of an Insolvency Event relating to WFN or Transferor;
(b) WFN shall become unable for any reason to transfer Receivables to Transferor pursuant to the Receivables Purchase Agreement or Transferor shall become unable for any reason to transfer Receivables to Issuer pursuant to the Transfer and Servicing Agreement; or
(c) Certificate Trust or Issuer shall become subject to regulation by the Commission as an "investment company" within the meaning of the Investment Company Act.
then an Early Amortization Event with respect to all Series of Notes shall occur without any notice or other action on the part of Indenture Trustee or the Noteholders immediately upon the occurrence of such event.
Upon the occurrence of an Early Amortization Event, payment on the Notes of each Series will be made in accordance with the terms of the related Indenture Supplement.
Section 5.2 EVENTS OF DEFAULT. "EVENT OF DEFAULT," wherever used herein, means with respect to any Series any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):
(a) default in the payment of the principal of any Note of that Series, if and to the extent not previously paid, when the same becomes due and payable on its Series Termination Date; or
(b) default in the payment of any interest on any Note of that Series when the same becomes due and payable, and such default shall continue for a period of thirty-five (35) days; or
(c) the filing of a decree or order for relief by a court having jurisdiction in the premises in respect of Issuer in an involuntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or appointing a receiver, conservator, liquidator, assignee, custodian, trustee, sequestrator or similar official for Issuer or ordering the winding-up or liquidation of Issuer's affairs, and such decree or order shall remain unstayed and in effect for a period of sixty (60) consecutive days; or
(d) the commencement by Issuer of a voluntary case under any applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or the consent by Issuer to the entry of an order for relief in an involuntary case under any such law, or the consent by Issuer to the appointment of or the taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator, conservator or similar official of Issuer, or the making by Issuer of any general assignment for the benefit of creditors, or the failure by Issuer generally to pay, or the admission in writing by Issuer of its inability to pay, its debts as such debts become due, or the taking of action by Issuer in furtherance of any of the foregoing; or
(e) default in the observance or performance of any covenant or agreement of Issuer made in this Indenture made in respect of the Notes of such Series (other than a covenant or agreement, a default in the observance or performance of which is elsewhere in this SECTION 5.2 specifically dealt with) (all of such covenants and agreements in the Indenture which are not expressly stated to be for the benefit of a particular Series being deemed to be in respect of the Notes of all Series for this purpose) and such default shall continue or not be cured for a period of sixty (60) days after there shall have been given, by registered or certified mail, return receipt requested to Issuer by Indenture Trustee or to Issuer and Indenture Trustee by the Holders of Notes representing at least 25% of the principal balance of the Outstanding Notes of such Series, a written notice specifying such default and requiring it to be remedied and stating that such notice is a "NOTICE OF DEFAULT" hereunder and, as a result of such default, the interests of the Holders of the Notes are materially and adversely affected and continue to be materially and adversely affected during the 60-day period; or
(f) any additional events specified in the Indenture Supplement related to such Series.
Issuer shall deliver to a Trustee Officer of Indenture Trustee, within five (5) days after the occurrence thereof, written notice in the form of an Officer's Certificate of any event which with the giving of notice and the lapse of time would become an Event of Default, its status and what action Issuer is taking or proposes to take with respect thereto.
Section 5.3 ACCELERATION OF MATURITY; RESCISSION AND ANNULMENT. If an Event of Default described in PARAGRAPH (a), (b) or (e) of SECTION 5.2 should occur and be continuing with respect to a Series, then and in every such case Indenture Trustee or the Holders of Notes representing more than 50% of the principal balance of the Outstanding Notes of such Series may declare all the Notes of such Series to be immediately due and payable, by a notice in writing to Issuer (and to a Trustee Officer of Indenture Trustee if declared by Noteholders), and upon any such declaration the unpaid principal amount of such Notes, together with accrued and unpaid interest thereon through the date of acceleration, shall become immediately due and payable.
If an Event of Default described in PARAGRAPH (c) or (d) of SECTION 5.2 should occur and be continuing, then the unpaid principal of the Notes, together with accrued and unpaid interest thereon through the date of acceleration, shall automatically become due and payable.
At any time after such declaration of acceleration of maturity has been made and before a judgment or decree for payment of the money due has been obtained by Indenture Trustee as hereinafter provided in this ARTICLE V, the Holders of Notes representing more than 50% of the principal balance of the Outstanding Notes of such Series, by written notice to Issuer, a Trustee Officer of Indenture Trustee and the Rating Agencies, may rescind and annul such declaration and its consequences; PROVIDED, THAT:
(a) Issuer has paid or deposited with Indenture Trustee a sum sufficient to pay:
(i) all payments of principal of and interest on all Notes and all other amounts that would then be due hereunder or upon such Notes if the Event of Default giving rise to such acceleration had not occurred; and
(ii) all sums paid or advanced by Indenture Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of Indenture Trustee and its agents and counsel; and
(b) all Events of Default, other than the nonpayment of the principal of the Notes that has become due solely by such acceleration, have been cured or waived as provided in SECTION 5.13.
No such rescission shall affect any subsequent default or impair any right consequent thereto.
Section 5.4 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY INDENTURE TRUSTEE.
(a) Issuer covenants that if (i) default is made in the payment of any interest on any Note when the same becomes due and payable, and such default continues for a period of thirty-five (35) days following the date on which such interest became due and payable, or (ii) default is made in the payment of principal of any Note, if and to the extent not previously paid, when the same becomes due and payable on the Series Termination Date, Issuer will, upon demand of Indenture Trustee, pay to it, for the benefit of the Holders of the Notes of the affected Series, the whole amount then due and payable on such Notes for principal and interest, with interest upon the overdue principal, and, to the extent payment at such rate of interest shall be legally enforceable, interest upon overdue installments of interest, as specified in the related Indenture Supplement, and in addition thereto will pay such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of Indenture Trustee and its agents and counsel.
(b) In case Issuer shall fail forthwith to pay such amounts upon such demand, Indenture Trustee, in its own name and as trustee of an express trust, may institute a Proceeding for the collection of the sums so due and unpaid, and may prosecute such Proceeding to judgment or final decree, and may enforce the same against Issuer or other obligor upon such Notes and collect in the manner provided by law out of the property of Issuer or other obligor upon such Notes, wherever situated, the moneys adjudged or decreed to be payable.
(c) If an Event of Default occurs and is continuing, Indenture Trustee may, as more particularly provided in SECTION 5.5, in its discretion, proceed to protect and enforce its rights and the rights of the Noteholders of the affected Series, by such appropriate Proceedings as Indenture Trustee shall deem necessary to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy or legal or equitable right vested in Indenture Trustee by this Indenture or by law.
(d) In case there shall be pending, relative to Issuer or any other obligor upon the Notes of the affected Series, or any Person having or claiming an ownership interest in the Collateral, Proceedings under Title 11 of the United States Code or any other applicable federal or state bankruptcy, insolvency or other similar law now or hereafter in effect, or in case a receiver, conservator, assignee or trustee in bankruptcy or reorganization, liquidator, sequestrator, custodian or other similar official shall have been appointed for or taken possession of Issuer or its property or such other obligor or Person, or in case of any other comparable judicial Proceedings relative to Issuer or other obligor upon the Notes of such Series, or to the creditors or property of Issuer or such other obligor, Indenture Trustee, irrespective of whether the principal of any Notes shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether Indenture Trustee shall have made any demand pursuant
to the provisions of this SECTION 5.4, shall be entitled and empowered, by intervention in such Proceedings or otherwise:
(i) to file and prove a claim or claims for the whole amount of principal and interest owing and unpaid in respect of the Notes of such Series and to file such other papers or documents as may be necessary or advisable in order to have the claims of Indenture Trustee (including any claim for reasonable compensation to Indenture Trustee and each predecessor Indenture Trustee, and their respective agents, attorneys and counsel, and for reimbursement of all expenses and liabilities incurred, and all advances made, by Indenture Trustee and each predecessor Indenture Trustee, except as a result of negligence or willful misconduct) and of the Noteholders of such Series allowed in such Proceedings;
(ii) unless prohibited by applicable law and regulations, to vote on behalf of the Holders of Notes of such Series in any election of a trustee, a standby trustee or Person performing similar functions in any such Proceedings;
(iii) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute all amounts received with respect to the claims of the Noteholders of such Series and of Indenture Trustee on their behalf; and
(iv) to file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of Indenture Trustee or the Holders of Notes of such Series allowed in any judicial Proceedings relative to Issuer, its creditors and its property;
and any trustee, receiver, conservator, liquidator, custodian, assignee, sequestrator or other similar official in any such Proceeding is hereby authorized by each of such Noteholders to make payments to Indenture Trustee, and, in the event that Indenture Trustee shall consent to the making of payments directly to such Noteholders, to pay to Indenture Trustee such amounts as shall be sufficient to cover reasonable compensation to Indenture Trustee, each predecessor Indenture Trustee and their respective agents, attorneys and counsel, and all other expenses and liabilities incurred, and all advances made, by Indenture Trustee and each predecessor Indenture Trustee except as a result of negligence or willful misconduct.
(e) Nothing herein contained shall be deemed to authorize Indenture Trustee to authorize or consent to or vote for or accept or adopt on behalf of any Noteholder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof or to authorize Indenture Trustee to vote in respect of the claim of any Noteholder in any such proceeding except, as aforesaid, to vote for the election of a trustee in bankruptcy or similar Person.
(f) All rights of action and of asserting claims under this Indenture, or under any of the Notes, may be enforced by Indenture Trustee without the possession of any of the Notes or the production thereof in any trial or other Proceedings relative thereto, and any such action or Proceedings instituted by Indenture Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment, subject to the payment of the expenses, disbursements and compensation of Indenture Trustee, each predecessor Indenture Trustee and their respective agents and attorneys, shall be for the benefit of the Holders of the Notes of the affected Series as provided herein.
(g) In any Proceedings brought by Indenture Trustee (and also any Proceedings involving the interpretation of any provision of this Indenture to which Indenture Trustee shall be a party), Indenture Trustee shall be held to represent all the Holders of the Notes of the affected Series, and it shall not be necessary to make any such Noteholder a party to any such Proceedings.
Section 5.5 REMEDIES; PRIORITIES.
(a) If an Event of Default shall have occurred and be continuing with respect to any Series, and the Notes of such Series have been accelerated pursuant to SECTION 5.3, Indenture Trustee may do one or more of the following (subject to SECTIONS 5.6 and 12.16):
(i) institute Proceedings in its own name and as trustee of an express trust for the collection of all amounts then payable on the Notes of the affected Series or under this Indenture with respect thereto, whether by declaration or otherwise, enforce any judgment obtained, and collect from Issuer and any other obligor upon such Notes moneys adjudged due;
(ii) take any other appropriate action to protect and enforce the rights and remedies of Indenture Trustee and the Holders of the Notes of the affected Series;
(iii) cause the Receivables Trust to sell Principal Receivables (or interests therein) in an amount equal to the Collateral Amount of the accelerated Series and the related Finance Charge Receivables in accordance with SECTION 5.16;
PROVIDED, HOWEVER, that Indenture Trustee may not exercise the remedy described in subparagraph (iii) above unless (A) (1) the Holders of Notes representing 100% of the principal balance of the Outstanding Notes of the affected Series consent in writing thereto, (2) Indenture Trustee determines that any proceeds of such exercise distributable to the Noteholders of the affected Series are sufficient to discharge in full all amounts then due and unpaid upon the Notes for principal and interest and is directed to exercise this remedy by Holders of Notes representing more than 50% of the principal balance of the Outstanding Notes of such Series, or (3) Indenture Trustee determines that the Collateral may not continue to provide sufficient funds for the payment of principal of and interest on the Notes as they would have become due if the Notes had not been declared due and
payable, and Indenture Trustee obtains the consent of the Holders of Notes representing at least 66-2/3% of the principal balance of the Outstanding Notes of each Class of such Series and (B) Indenture Trustee has been provided with an Opinion of Counsel to the effect that the exercise of such remedy complies with applicable federal and state securities laws. In determining such sufficiency or insufficiency with respect to clauses (A)(2) and (A)(3), Indenture Trustee may, but need not, obtain and conclusively rely upon an opinion of an Independent investment banking or accounting firm of national reputation as to the feasibility of such proposed action and as to the sufficiency of the Collateral for such purpose.
The remedies provided in this SECTION 5.5(a) are the exclusive remedies provided to the Noteholders with respect to the Collateral and each of the Noteholders (by their acceptance of their respective interests in the Notes) or Indenture Trustee hereby expressly waive any other remedy that might have been available under the applicable UCC.
(b) If Indenture Trustee collects any money or property pursuant to this Article V following the acceleration of the Notes of the affected Series pursuant to Section 5.3 (so long as such a declaration shall not have been rescinded or annulled), it shall pay out the money or property in the following order:
FIRST: to Indenture Trustee for amounts due pursuant to SECTION 6.7;
and
SECOND: unless otherwise specified in the related Indenture
Supplement, to Servicer for distribution in accordance with
Article IV of the related Indenture Supplement with such
amounts being deemed to be Principal Collections and Finance
Charge Collections in the same proportion as (x) the
outstanding principal balance of the Notes bears to (y) the
sum of the accrued and unpaid interest on the Notes and other
fees and expenses payable in connection therewith under the
applicable Indenture Supplement, including the amounts payable
under any Enhancements with respect to such Series.
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(c) Indenture Trustee may, upon notification to Issuer, fix a record date and payment date for any payment to Noteholders of the affected Series pursuant to this SECTION 5.5. At least fifteen (15) days before such record date, Indenture Trustee shall mail or send by facsimile, at the expense of Servicer, to each such Noteholder a notice that states the record date, the payment date and the amount to be paid.
(d) In addition to the application of money or property referred to in
SECTION 5.5(b) for an accelerated Series, amounts then held in the Collection
Account, Excess Funding Account or any Series Accounts for such Series and any
amounts available under the Enhancement for such Series shall be used to make
payments to the Holders of the Notes of such Series and the Enhancement Provider
for such Series in accordance with the terms of this Indenture, the related
Indenture Supplement and the Enhancement for such Series. Following the sale of
any Principal Receivables and related Finance Charge Receivables pursuant to
SECTION 5.5(a)(iii) (or interests therein) for a Series and the application of
the proceeds of such sale to such Series and the application of the amounts then
held in the Collection Account, the Excess Funding Account and any Series
Accounts for such Series as are allocated to such Series and any amounts
available under the Enhancement for such Series, such Series shall no longer be
entitled to any allocation of Collections or other property constituting the
Collateral under this Indenture.
Section 5.6 OPTIONAL PRESERVATION OF THE COLLATERAL. If the Notes of any Series have been declared to be due and payable under SECTION 5.3 following an Event of Default and such declaration and its consequences have not been rescinded and annulled, and Indenture Trustee has not received directions from the Noteholders pursuant to SECTION 5.12, Indenture Trustee may, but need not, elect to maintain possession of the portion of the Collateral which secures such Notes and apply proceeds of the Collateral to make payments on such Notes to the extent such proceeds are available therefor. It is the desire of the parties hereto and the Noteholders that there be at all times sufficient funds for the payment of principal of and interest on the Notes, and Indenture Trustee shall take such desire into account when determining whether or not to maintain possession of the Collateral. In determining whether to maintain possession of the Collateral, Indenture Trustee may, but need not, obtain and conclusively rely upon an opinion of an Independent investment banking or accounting firm of national reputation as to the feasibility of such proposed action and as to the sufficiency of the Collateral for such purpose.
Section 5.7 LIMITATION ON SUITS. No Noteholder shall have any right to institute any proceedings, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless:
(a) the Holders of Notes representing not less than 25% of the principal balance of the Outstanding Notes of each affected Series have made written request to Indenture Trustee to institute such proceeding in its own name as indenture trustee;
(b) such Noteholder or Noteholders has previously given written notice to Indenture Trustee of a continuing Event of Default;
(c) such Noteholder or Noteholders has offered to Indenture Trustee indemnity satisfactory to it against the costs, expenses and liabilities to be incurred in compliance with such request;
(d) Indenture Trustee for sixty (60) days after its receipt of such request and offer of indemnity has failed to institute any such Proceeding; and
(e) no direction inconsistent with such written request has been given to Indenture Trustee during such 60-day period by the Holders of Notes representing more than 50% of the principal balance of the Outstanding Notes of such Series;
it being understood and intended that no one or more Noteholders of the affected Series shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other Noteholders of such Series or to obtain or to seek to obtain priority or preference over any other Noteholders of such Series or to enforce any right under this Indenture, except in the manner herein provided.
In the event Indenture Trustee shall receive conflicting or inconsistent requests and indemnity from two (2) or more groups of Noteholders of such affected Series, each representing no more than 50% of the principal balance of the Outstanding Notes of such Series, Indenture Trustee in its sole discretion may determine what action, if any, shall be taken, notwithstanding any other provisions of this Indenture.
Section 5.8 UNCONDITIONAL RIGHTS OF NOTEHOLDERS TO RECEIVE PRINCIPAL AND INTEREST. Notwithstanding any other provision in this Indenture, each Noteholder shall have the right which is absolute and unconditional to receive payment of the principal of and interest in respect of such Note as such principal and interest becomes due and payable and to institute suit for the enforcement of any such payment, and such right shall not be impaired without the consent of such Noteholder.
Section 5.9 RESTORATION OF RIGHTS AND REMEDIES. If Indenture Trustee or any Noteholder has instituted any Proceeding to enforce any right or remedy under this Indenture and such Proceeding has been discontinued or abandoned, or has been determined adversely to Indenture Trustee or to such Noteholder, then and in every such case Issuer, Indenture Trustee and the Noteholder shall, subject to any determination in such Proceeding, be restored severally and respectively to their former positions hereunder, and thereafter all rights and remedies of Indenture Trustee and the Noteholders shall continue as though no such Proceeding had been instituted.
Section 5.10 RIGHTS AND REMEDIES CUMULATIVE. No right, remedy, power or privilege herein conferred upon or reserved to Indenture Trustee or to the Noteholders is intended to be exclusive of any other right, remedy, power or privilege, and every right, remedy, power or privilege shall, to the extent permitted by law, be cumulative and in addition to every other right, remedy, power or privilege given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or exercise of any right or remedy shall not preclude any other further assertion or the exercise of any other appropriate right or remedy.
Section 5.11 DELAY OR OMISSION NOT WAIVER. No failure to exercise and no delay in exercising, on the part of Indenture Trustee or of any Noteholder or
other Person, any right or remedy occurring hereunder upon any Event of Default shall impair any such right or remedy or constitute a waiver thereof of any such Event of Default or an acquiescence therein. Every right and remedy given by this ARTICLE V or by law to Indenture Trustee or to the Noteholders may be exercised from time to time, and as often as may be deemed expedient, by Indenture Trustee or by the Noteholders, as the case may be.
Section 5.12 RIGHTS OF NOTEHOLDERS TO DIRECT INDENTURE TRUSTEE. The Holders of Notes representing more than 50% of the principal balance of the Outstanding Notes of any affected Series shall have the right to direct in writing the time, method and place of conducting any Proceeding for any remedy available to Indenture Trustee with respect to such Series or exercising any trust or power conferred on Indenture Trustee with respect to such Series; PROVIDED, HOWEVER, that subject to SECTION 6.1 Indenture Trustee shall have the right to decline any such direction if:
(a) Indenture Trustee, after being advised by counsel, determines that the action so directed is in conflict with any rule of law or with this Indenture;
(b) Indenture Trustee in good faith shall, by a Trustee Officer of Indenture Trustee, determine that the Proceedings so directed would be illegal or involve Indenture Trustee in personal liability or be unjustly prejudicial to the Noteholders not parties to such direction; or
(c) Indenture Trustee reasonably believes it will not be adequately indemnified against the costs, expenses and liabilities which might be incurred by it in complying with the action so directed.
Section 5.13 WAIVER OF PAST DEFAULTS. Prior to the declaration of the
acceleration of the maturity of the Notes of the affected Series as provided in
SECTION 5.3, Holders of Notes representing more than 50% of the principal
balance of the Outstanding Notes of such Series (or with respect to any such
Series with two or more Classes, of each Class), may, on behalf of all such
Noteholders, waive in writing any past default, with written notice to Indenture
Trustee, with respect to such Notes and its consequences, except a default:
(a) in the payment of the principal or interest in respect of any Note of such Series, or
(b) in respect of a covenant or provision hereof that under SECTION 10.2 cannot be modified or amended without the consent of the Noteholder of each Outstanding Note affected.
Upon any such written waiver, such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon.
Section 5.14 UNDERTAKING FOR COSTS. All parties to this Indenture agree, and each Noteholder by its acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against Indenture Trustee for any action taken, suffered or omitted by it as Indenture Trustee, the filing by any party litigant in such suit of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees and expenses, against any party litigant (other than Indenture Trustee) in such suit, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this SECTION 5.14 shall not apply to any suit instituted by Indenture Trustee, to any suit instituted by any Noteholder, or group of Noteholders (in compliance with SECTION 5.8), holding Notes representing more than 10% of the principal balance of the Outstanding Notes of the affected Series, or to any suit instituted by any Noteholder for the enforcement of the payment of the principal or interest in respect of any Note on or after the Distribution Date on which any of such amounts was due (or, in the case of redemption, on or after the applicable Redemption Date).
Section 5.15 WAIVER OF STAY OR EXTENSION LAWS. Issuer covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, now or at any time hereafter in force, which may adversely affect the covenants or the performance of this Indenture; and Issuer (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to Indenture Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.
Section 5.16 SALE OF RECEIVABLES.
(a) The method, manner, time, place and terms of any sale of Receivables (or interests therein) pursuant to SECTION 5.5(a)(iii) shall be commercially reasonable. Indenture Trustee may from time to time postpone any sale by public announcement made at the time and place of such sale. Indenture Trustee hereby expressly waives its right to any amount fixed by law as compensation for any sale.
(b) Indenture Trustee is hereby irrevocably appointed the agent and attorney-in-fact of Issuer in connection with any sale of Receivables pursuant to SECTION 5.5(a)(iii). No purchaser or transferee at any such sale shall be bound to ascertain Indenture Trustee's authority, inquire into the satisfaction of any conditions precedent or see to the application of any monies.
(c) In its exercise of the foreclosure remedy pursuant to SECTION 5.5(a)(iii), Indenture Trustee shall solicit, or cause to be solicited, bids for the sale of Principal Receivables (or interests therein) in any amount equal to the Collateral Amount of the affected Series of Notes at the time of sale and the
related Finance Charge Receivables (or interests therein). Indenture Trustee shall sell, or cause to be sold, such Receivables (or interests therein) to the bidder with the highest cash purchase offer. The proceeds of any such sale shall be applied as specified in the applicable Indenture Supplement.
Section 5.17 ACTION ON NOTES. Indenture Trustee's right to seek and recover judgment on the Notes or under this Indenture shall not be affected by the seeking or obtaining of or application for any other relief under or with respect to this Indenture. Neither the lien of this Indenture nor any rights or remedies of Indenture Trustee or the Noteholders shall be impaired by the recovery of any judgment by Indenture Trustee against Issuer or by the levy of any execution under such judgment upon any portion of the Collateral or upon any of the assets of Issuer. Any money or property collected by Indenture Trustee shall be applied as specified in the applicable Indenture Supplement.
ARTICLE VI
INDENTURE TRUSTEE
Section 6.1 DUTIES OF INDENTURE TRUSTEE.
(a) If an Event of Default has occurred and is continuing and a Trustee Officer shall have actual knowledge or written notice of such Event of Default, Indenture Trustee shall exercise the rights and powers vested in it by this Indenture 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 such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) Indenture Trustee undertakes to perform such duties and only such duties as are specifically set forth in this Indenture, and no implied covenants or obligations shall be read into this Indenture against Indenture Trustee; and
(ii) in the absence of bad faith or negligence on its part, Indenture Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to Indenture Trustee and conforming to the requirements of this Indenture; PROVIDED, HOWEVER, Indenture Trustee, upon receipt of any resolutions, certificates, statements, opinions, reports, documents, orders or other instruments furnished to Indenture Trustee which are specifically required to be furnished pursuant to any provision of this Indenture or any Indenture Supplement, shall examine them to determine whether they substantially conform to the requirements of this Indenture or any Indenture Supplement but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein.
(c) If an Early Amortization Event has occurred and is continuing and a Trustee Officer shall have actual knowledge or written notice of such Early Amortization Event, Indenture Trustee shall exercise such of the rights and powers vested in it by this Indenture, 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 such person's own affairs.
(d) No provision of this Indenture shall be construed to relieve Indenture Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:
(i) this SECTION 6.1(d) shall not be construed to limit the effect of SECTION 6.1(a);
(ii) Indenture Trustee shall not be liable for any error of judgment made in good faith by a Trustee Officer, unless it shall be proved that Indenture Trustee was negligent in ascertaining the pertinent facts; and
(iii) Indenture 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 Indenture and/or the direction of the Holders of Notes or for exercising any trust or power conferred upon Indenture Trustee, under this Indenture. Indenture Trustee shall not be liable for any action taken, suffered or omitted to be taken by it in good faith in accordance with the direction of Servicer, Transferor or the Trust in compliance with the terms of this Indenture or any Indenture Supplement.
(e) No provision of this Indenture shall require Indenture Trustee to expend or risk its own funds or otherwise incur any liability, financial or otherwise, in the performance of any of its duties hereunder or in the exercise of any of its rights or powers if it shall have reasonable grounds for believing that repayment of such funds or indemnity satisfactory to it against such risk or liability is not reasonably assured to it.
(f) Every provision of this Indenture that in any way relates to Indenture Trustee is subject to this SECTION 6.1.
(g) Except as expressly provided in this Indenture, Indenture Trustee shall have no power to vary the Collateral, including by (i) accepting any substitute payment obligation for a Receivable initially transferred to the Trust under the Transfer and Servicing Agreement, (ii) adding any other investment, obligation or security to the Trust or (iii) withdrawing from Issuer any Receivable (except as otherwise provided in the Transfer and Servicing Agreement).
(h) Indenture Trustee shall have no responsibility or liability for investment losses on Eligible Investments (other than Eligible Investments on which the institution acting as Indenture Trustee is an obligor). Indenture Trustee shall have no obligation to invest and reinvest any cash held in the absence of
timely and specific written investment direction from Issuer. In no event shall Indenture Trustee be liable for the selection of investments or for investment losses incurred thereon. Indenture Trustee shall have no liability in respect of losses incurred as a result of the liquidation of any investment prior to its stated maturity or the failure of Issuer to provide timely written investment direction.
(i) Indenture Trustee shall notify each Rating Agency (i) of any change in any rating of the Notes by any other Rating Agency of which a Trustee Officer of Indenture Trustee has actual knowledge, and (ii) immediately of the occurrence of any Event of Default or Early Amortization Event of which a Trustee Officer of Indenture Trustee has actual knowledge of or has actual notice from Servicer of potential Early Amortization Events or Events of Default.
(j) For all purposes under this Indenture, Indenture Trustee shall not be deemed to have notice or knowledge of any Event of Default, Early Amortization Event or Servicer Default unless a Trustee Officer assigned to and working in the Corporate Trust Office of Indenture Trustee has actual knowledge thereof or has received written notice thereof. For purposes of determining Indenture Trustee's responsibility and liability hereunder, any reference to an Event of Default, Early Amortization Event or Servicer Default shall be construed to refer only to such event of which Indenture Trustee is deemed to have notice as described in this SECTION 6.1(J).
Section 6.2 NOTICE OF EARLY AMORTIZATION EVENT OR EVENT OF DEFAULT. Upon the occurrence of any Early Amortization Event or Event of Default of which a Trustee Officer has actual knowledge or has received written notice thereof, Indenture Trustee shall transmit by mail to all Noteholders as their names and addresses appear on the Note Register and the Rating Agencies, notice of such Early Amortization Event or Event of Default hereunder known to Indenture Trustee within thirty (30) days after it occurs or within ten (10) Business Days after it receives such notice or obtains actual notice, if later.
Section 6.3 RIGHTS OF INDENTURE TRUSTEE. EXCEPT AS OTHERWISE PROVIDED IN
SECTION 6.1:
(a) Indenture Trustee may conclusively rely and shall fully be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, note or other paper or document (whether in its original or facsimile form) reasonably believed by it to be genuine and to have been signed or presented by the proper party or parties;
(b) whenever in the administration of this Indenture Indenture Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, Indenture Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, conclusively rely upon an Officer's Certificate of Issuer. Issuer shall provide a copy of such Officer's Certificate to the Noteholders at or prior to the time Indenture Trustee receives such Officer's Certificate;
(c) as a condition to the taking, suffering or omitting of any action by it hereunder, Indenture Trustee may consult with counsel of its own selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in-good faith and in reliance thereon;
(d) Indenture Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture or to honor the request or direction of any of the Noteholders pursuant to this Indenture, unless such Noteholders shall have offered to Indenture Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction;
(e) Indenture Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, note or other paper or document, but Indenture Trustee at the written direction of one or more of the Noteholders and at the expense of the Noteholders, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if Indenture Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of Issuer and Servicer, personally or by agent or attorney and shall at the expense of the Servicer incur no liability of any kind by reason of such inquiry or investigation;
(f) Indenture Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents, attorneys,
custodians or nominees and Indenture Trustee shall not be responsible for any
(i) misconduct or negligence on the part of any agent, attorney, custodians or
nominees appointed with due care by it hereunder or (ii) the supervision of such
agents, attorneys, custodians or nominees after such appointment with due care;
(g) Indenture Trustee shall not be liable for any actions taken, suffered or omitted by it in good faith and believed by it to be authorized or within the discretion or rights conferred upon Indenture Trustee by this Indenture; and
(h) in the event that Indenture Trustee is also acting as Paying Agent and Transfer Agent and Registrar and Successor Servicer, if it becomes Successor Servicer pursuant to Section 7.2 of the Transfer and Servicing Agreement, the rights and protections afforded to Indenture Trustee pursuant to this ARTICLE VI shall also be afforded to such Paying Agent and Transfer Agent and Registrar and Successor Servicer, if it becomes Successor Servicer pursuant to Section 7.2 of the Transfer and Servicing Agreement.
Section 6.4 NOT RESPONSIBLE FOR RECITALS OR ISSUANCE OF NOTES. The recitals contained herein and in the Notes, except the certificate of authentication of Indenture Trustee, shall be taken as the statements of Issuer, and Indenture Trustee assumes no responsibility for their correctness. Neither Indenture Trustee
nor any of its agents makes any representation as to the validity or sufficiency of the Agreement, the Notes, or any related document. Indenture Trustee shall not be accountable for the use or application by Issuer of the proceeds from the Notes.
Section 6.5 RESTRICTIONS ON HOLDING NOTES. Indenture Trustee shall not in its individual capacity, but may in a fiduciary capacity, become the owner or pledgee of Notes and may otherwise deal with Issuer with the same rights it would have if it were not Indenture Trustee, Paying Agent, Transfer Agent and Registrar or such other agent. Any Paying Agent, Transfer Agent and Registrar that is not also Indenture Trustee or any other agent of Issuer, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with Issuer with the same rights it would have if it were not Paying Agent, Transfer Agent and Registrar or such other agent.
Section 6.6 MONEY HELD IN TRUST. Money held by Indenture Trustee in trust hereunder need not be segregated from other funds held by Indenture Trustee in trust hereunder except to the extent required herein or required by law. Indenture Trustee shall be under no liability for interest on any money received by it hereunder except as otherwise agreed upon in writing by Indenture Trustee and Issuer.
Section 6.7 COMPENSATION, REIMBURSEMENT AND INDEMNIFICATION. Servicer shall pay to Indenture Trustee from time to time reasonable compensation for all services rendered by Indenture Trustee and the Authenticating Agent under this Agreement (which compensation shall not be limited by any law on compensation of a trustee of an express trust). Servicer shall reimburse Indenture Trustee for all reasonable out-of-pocket expenses incurred or made by it, including costs of collection, in addition to the compensation for its services. Such expenses shall include the reasonable compensation and expenses, disbursements and advances of Indenture Trustee's agents, counsel, accountants and experts. Issuer shall direct Servicer to indemnify, defend and hold harmless, and Servicer shall indemnify Indenture Trustee and its officers, directors, employees and agents against any and all loss, liability, expense, damage or claim (including the fees of either in-house counsel or outside counsel) incurred by it in connection with the administration of this trust and the performance of its duties hereunder and under any other Transaction Document, including any claim arising from any failure by Issuer or Transferor to pay when due any sales, excise, transfer or personal taxes relating to the Receivables. Indenture Trustee shall notify Issuer and Servicer promptly of any claim for which it may seek indemnity. Failure by Indenture Trustee to so notify Issuer and Servicer of a claim of which a Responsible Officer has received written notice shall not relieve Issuer or Servicer of its obligations hereunder unless such loss, liability or expense could have been avoided with such prompt notification and then only to the extent of such loss, expense or liability which could have been so avoided. Servicer shall defend any claim against Indenture Trustee, Indenture Trustee may have separate counsel and, if it does, Servicer shall pay the fees and expenses of such counsel. Neither Issuer nor Servicer need reimburse any expense or indemnify against any loss, liability or expense determined by a
court of competent jurisdiction to have been caused by Indenture Trustee through Indenture Trustee's own willful misconduct or negligence.
Servicer's payment obligations to Indenture Trustee pursuant to this
SECTION 6.7 shall survive the discharge of this Indenture or earlier resignation
or removal of Indenture Trustee. When Indenture Trustee incurs expenses after
the occurrence of an Event of Default specified in SECTION 5.2(c) or 5.2(d) with
respect to Issuer, the expenses are intended to constitute expenses of
administration under Title 11 of the United States Code or any other applicable
federal or state bankruptcy, insolvency or similar law.
To secure Servicer's and Issuer's payment obligations in this SECTION 6.7, Indenture Trustee shall have a lien prior to the Notes on all money or property held or collected by Indenture Trustee, in its capacity as Indenture Trustee, except money or property held in trust to pay principal of, or interest on, the Notes.
Section 6.8 REPLACEMENT OF INDENTURE TRUSTEE. No resignation or removal of Indenture Trustee and no appointment of a successor Indenture Trustee shall become effective until the acceptance of appointment by the successor Indenture Trustee pursuant to this SECTION 6.8. Indenture Trustee may resign at any time by giving thirty (30) days written notice to Issuer and the Rating Agencies. The Holders of Notes representing more than 66 2/3% of the Outstanding Amount may remove Indenture Trustee by so notifying Indenture Trustee in writing and may appoint a successor Indenture Trustee. Administrator shall remove Indenture Trustee upon written notice if:
(i) Indenture Trustee fails to comply with SECTION 6.11;
(ii) Indenture Trustee is adjudged a bankrupt or insolvent;
(iii) a receiver of Indenture Trustee or of its property shall be appointed, or any public officer takes charge of Indenture Trustee or its property or its affairs for the purpose of rehabilitation, conservation or liquidation; or
(iv) Indenture Trustee otherwise becomes legally unable to act.
If Indenture Trustee resigns or is removed or if a vacancy exists in the office of Indenture Trustee for any reason (Indenture Trustee in such event being referred to herein as the retiring Indenture Trustee), Administrator shall promptly appoint a successor Indenture Trustee.
A successor Indenture Trustee shall deliver a written acceptance of its appointment to the retiring Indenture Trustee, Servicer and to Issuer. Thereupon the resignation or removal of the retiring Indenture Trustee shall become effective, and the successor Indenture Trustee shall have all the rights, powers and duties of Indenture Trustee under this Indenture. The successor Indenture Trustee shall mail a notice of its succession to Noteholders. The retiring Indenture Trustee shall promptly transfer all property held by it as Indenture Trustee to the
successor Indenture Trustee, subject to the payment of any and all amounts then due and owing to Indenture Trustee.
If a successor Indenture Trustee does not take office within sixty (60) days after the retiring Indenture Trustee resigns or is removed, the retiring Indenture Trustee, Issuer or the Holders of Notes representing more than 50% of the Outstanding Amount may petition any court of competent jurisdiction for the appointment of a successor Indenture Trustee.
If Indenture Trustee fails to comply with SECTION 6.11, any Noteholder may petition any court of competent jurisdiction for the removal of Indenture Trustee and the appointment of a successor Indenture Trustee.
Notwithstanding the replacement of Indenture Trustee pursuant to this
SECTION 6.8, Issuer's obligations under SECTION 6.7 shall continue for the
benefit of the retiring Indenture Trustee.
Administrator shall notify the Rating Agencies of any replacement of Indenture Trustee pursuant to this SECTION 6.8.
Section 6.9 SUCCESSOR INDENTURE TRUSTEE BY MERGER. If Indenture Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Indenture Trustee; provided that such corporation or banking association shall be otherwise qualified and eligible under SECTION 6.11. Indenture Trustee shall provide the Rating Agencies prior written notice of any such transaction.
In case at the time such successor or successors by merger, conversion, consolidation or transfer to Indenture Trustee shall succeed to the trusts created by this Indenture any of the Notes shall have been authenticated but not delivered, any such successor to Indenture Trustee may adopt the certificate of authentication of any predecessor Indenture Trustee and deliver such Notes so authenticated; and in case at that time any of the Notes shall not have been authenticated, any successor to Indenture Trustee may authenticate such Notes in the name of the successor to Indenture Trustee; and in all such cases such certificates shall have the full force which it is anywhere in the Notes or in this Indenture provided that the certificate of Indenture Trustee shall have.
Section 6.10 APPOINTMENT OF CO-INDENTURE TRUSTEE OR SEPARATE INDENTURE TRUSTEE.
(a) Notwithstanding any other provisions of this Indenture, at any time, for the purpose of meeting any legal requirement of any jurisdiction in which any part of the Collateral may at the time be located, Indenture 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 Collateral, and to vest in such Person or Persons,
in such capacity and for the benefit of the Noteholders, such title to the
Collateral, or any part hereof, and, subject to the other provisions of this
SECTION 6.10, such powers, duties, obligations, rights and trusts as Indenture
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 6.11 and no notice to Noteholders of the appointment of
any co-trustee or separate trustee shall be required under SECTION 6.8.
(b) Every separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or imposed upon Indenture Trustee shall be conferred or imposed upon and exercised or performed by Indenture 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 Indenture 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 Indenture 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 Collateral 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 Indenture Trustee;
(ii) no trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder;
(iii) Indenture Trustee may at any time accept the resignation of or remove any separate trustee or co-trustee; and
(iv) Indenture Trustee shall not be liable for any act or failure to act on the part of any separate trustee or co-trustee.
(c) Any notice, request or other writing given to Indenture 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 Indenture and the conditions of this ARTICLE VI. 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 Indenture Trustee or separately, as may be provided therein, subject to all the provisions of this Indenture, specifically including every provision of this Indenture relating to the conduct of, affecting the liability of, or affording protection to, Indenture Trustee. Every such instrument shall be filed with Indenture Trustee.
(d) Any separate trustee or co-trustee may at any time constitute Indenture 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
Indenture on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by Indenture Trustee, to the extent permitted by law, without the appointment of a new or successor trustee.
Section 6.11 ELIGIBILITY; DISQUALIFICATION. Indenture Trustee shall at all times satisfy the requirements of TIA ss.310(a). Indenture Trustee shall have a combined capital and surplus of at least $50,000,000 as set forth in its most recent published annual report of condition and either its long-term unsecured debt shall be rated at least Baa3 by Moody's and BBB- by Standard & Poor's or its short-term debt shall be rated at least P-2 by Moody's and A-2 by Standard & Poor's. Indenture Trustee shall comply with TIA ss.310(b), including the optional provision permitted by the second sentence of TIA ss.310(b)(9); provided, however, that there shall be excluded from the operation of TIA ss.310(b)(1) any indenture or indentures under which other securities of Issuer are outstanding if the requirements for such exclusion set forth in TIA ss.310(b)(1) are met.
Section 6.12 PREFERENTIAL COLLECTION OF CLAIMS AGAINST. Indenture Trustee shall comply with TIA ss.311(a), excluding any creditor relationship listed in TIA ss.311(b). An Indenture Trustee who has resigned or been removed shall be subject to TIA ss.311(a) to the extent indicated.
Section 6.13 REPRESENTATIONS AND COVENANTS OF INDENTURE TRUSTEE. Indenture Trustee represents, warrants and covenants that:
(i) Indenture Trustee is a trust company duly organized and validly existing under the laws of the State of Illinois;
(ii) Indenture Trustee has full power and authority to deliver and perform this Indenture and has taken all necessary action to authorize the execution, delivery and performance by it of this Indenture and other Transaction Documents to which it is a party; and
(iii) Each of this Indenture and the other Transaction Documents to which it is a party has been duly executed and delivered by Indenture Trustee and constitutes its legal, valid and binding obligation in accordance with its terms.
Section 6.14 CUSTODY OF THE COLLATERAL. Indenture Trustee shall hold such of the Collateral as consists of instruments, deposit accounts, negotiable documents, money, goods, letters of credit, and advices of credit in the State of New York. Indenture Trustee shall hold such of the Collateral as constitutes investment property through a securities intermediary, which securities intermediary shall agree with Indenture Trustee that (a) such investment property shall at all times be credited to a securities account of Indenture Trustee, (b) such securities intermediary shall treat Indenture Trustee as entitled to exercise the rights that comprise each financial asset credited to such securities account, (c) all property credited to such securities account shall be treated as a financial asset,
(d) such securities intermediary shall comply with entitlement orders originated
by Indenture Trustee without the further consent of any other person or entity,
(e) such securities intermediary will not agree with any person or entity other
than Indenture Trustee to comply with entitlement orders originated by such
other person or entity, (f) such securities accounts and the property credited
thereto shall not be subject to any lien, security interest, or right of set-off
in favor of such securities intermediary or anyone claiming through it (other
than Indenture Trustee), and (g) such agreement shall be governed by the laws of
the State of New York. Terms used in the preceding sentence that are defined in
the New York UCC and not otherwise defined herein shall have the meaning set
forth in the New York UCC. Except as permitted by this SECTION 6.14, Indenture
Trustee shall not hold any part of the Trust Estate through an agent or a
nominee.
ARTICLE VII
NOTEHOLDERS' LIST AND REPORTS BY
INDENTURE TRUSTEE AND ISSUER
Section 7.1 ISSUER TO FURNISH INDENTURE TRUSTEE NAMES AND ADDRESSES OF
NOTEHOLDERS. Issuer will furnish or cause to be furnished to Indenture Trustee
(a) upon each transfer of a Note, a list, in such form as Indenture Trustee may
reasonably require, of the names, addresses and taxpayer identification numbers
of the Noteholders as they appear on the Note Register as of such Record Date,
and (b) at such other times, as Indenture Trustee may request in writing, within
ten (10) days after receipt by Issuer of any such request, a list of similar
form and content as of a date not more than ten (10) days prior to the time such
list is furnished; PROVIDED, HOWEVER, that for so long as Indenture Trustee is
Transfer Agent and Registrar, Indenture Trustee shall furnish to Issuer such
list in the same manner prescribed in clause (b) above.
Section 7.2 PRESERVATION OF INFORMATION; COMMUNICATIONS TO NOTEHOLDERS.
(a) Indenture Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of the Noteholders contained in the most recent list furnished to Indenture Trustee as provided in SECTION 7.1 and the names, addresses and taxpayer identification numbers of the Noteholders received by Indenture Trustee in its capacity as Transfer Agent and Registrar. Indenture Trustee may destroy any list furnished to it as provided in SECTION 7.1 upon receipt of a new list so furnished.
(b) Noteholders may communicate, pursuant to TIA ss.312(b), with other Noteholders with respect to their rights under this Indenture or under the Notes.
(c) Issuer, Indenture Trustee and Transfer Agent and Registrar shall have the protection of TIA ss.312(c).
Section 7.3 REPORTS BY ISSUER.
(a) Issuer shall:
(i) file with Indenture Trustee, within fifteen (15) days after Issuer is required to file the same with the Commission, copies of the annual reports and of the information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) which Issuer may be required to file with the Commission pursuant to Section 13 or 15(d) of the Exchange Act;
(ii) file with Indenture Trustee and the Commission in accordance with rules and regulations prescribed from time to time by the Commission such additional information, documents and reports with respect to compliance by Issuer with the conditions and covenants of this Indenture as may be required from time to time by such rules and regulations; and
(iii) supply to Indenture Trustee (and Indenture Trustee shall transmit by mail to all Noteholders described in TIA ss.313(c)) such summaries of any information, documents and reports required to be filed by Issuer pursuant to clauses (i) and (ii) of this SECTION 7.3(a) as may be required by rules and regulations prescribed from time to time by the Commission.
(b) Unless Issuer otherwise determines, the fiscal year of Issuer shall end on December 31 of each year.
(c) Delivery of such reports, information and documents to Indenture Trustee is for informational purposes only and Indenture Trustee's receipt of such shall not constitute constructive notice of any information contained therein or determinable from information contained therein, including Issuer's compliance with any of the covenants hereunder.
Section 7.4 REPORTS BY INDENTURE TRUSTEE. If required by TIA ss.313(a), within sixty (60) days after each March 31 beginning with March 31, 2002, Indenture Trustee shall mail to each Noteholder as required by TIA ss.313(c) a brief report dated as of such date that complies with TIA ss.313(a). Indenture Trustee also shall comply with TIA ss.313(b).
A copy of each report at the time of its mailing to Noteholders shall be filed by Indenture Trustee with the Commission and each stock exchange, if any, on which the Notes are listed. Issuer shall notify Indenture Trustee if and when the Notes are listed on any stock exchange or delisted therefrom.
ARTICLE VIII
ALLOCATION AND APPLICATION OF COLLECTIONS
Section 8.1 COLLECTION OF MONEY. Except as otherwise expressly provided herein and in the related Indenture Supplement, Indenture Trustee may demand payment or delivery of, and shall receive and collect, directly and without intervention or assistance of any fiscal agent or other intermediary, all money and other property payable to or receivable by Indenture Trustee pursuant to this Indenture. Indenture Trustee shall hold all such money and property received by it in trust for the Noteholders and shall apply it as provided in this Indenture. Except as otherwise expressly provided in this Indenture, if any default occurs in the making of any payment or performance under the Transfer and Servicing Agreement or any other Transaction Document, Indenture Trustee may, and upon the written request of the Holders of Notes representing more than 50% of the principal balance of the Outstanding Notes of the affected Series shall, subject to SECTIONS 6.1(e) and 6.3(d), take such action as may be appropriate to enforce such payment or performance, including the institution and prosecution of appropriate Proceedings. Any such action shall be without prejudice to any right to claim an Early Amortization Event or a Default or Event of Default under this Indenture and to proceed thereafter as provided in ARTICLE V.
Section 8.2 RIGHTS OF NOTEHOLDERS. The Collateral shall secure Issuer's obligations to pay to the Holders of the Notes of each Series a portion of Collections allocable to the Noteholders of such Series pursuant to this Indenture and the related Indenture Supplement, funds and other property credited to the Collection Account and the Excess Funding Account (or any subaccount thereof) allocable to the Noteholders of such Series pursuant to this Indenture and such Indenture Supplement, funds and other property credited to any related Series Account and funds available pursuant to any related Enhancement, it being understood that, except as specifically set forth in the Indenture Supplement with respect thereto, the Notes of any Series or Class shall not be secured by any interest in any Series Account or Enhancement pledged for the benefit of any other Series or Class.
Section 8.3 ESTABLISHMENT OF COLLECTION ACCOUNT AND EXCESS FUNDING ACCOUNT.
Servicer, for the benefit of the Holders, shall establish and maintain in the name of Indenture Trustee two Eligible Deposit Accounts (the "COLLECTION ACCOUNT" and the "EXCESS FUNDING ACCOUNT"), each bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Holders. The Collection Account and the Excess Funding Account shall initially be established with Indenture Trustee. Indenture Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Collection Account and the Excess Funding Account and in all proceeds thereof for the benefit of the Holders. The Collection Account and the Excess Funding Account shall be under the sole dominion and control of Indenture Trustee for the benefit of the Holders. Except as expressly provided in this Indenture, Indenture Trustee agrees that it
shall have no right of set-off or banker's lien against, and no right to otherwise deduct from, any funds held in the Collection Account or the Excess Funding Account for any amount owed to it by Issuer, any Holder or any Enhancement Provider. If at any time the Collection Account or the Excess Funding Account ceases to be an Eligible Deposit Account, Indenture Trustee (or Servicer on its behalf) shall within 10 Business Days (or such longer period, not to exceed 30 calendar days, as to which the Rating Agency Condition is satisfied) establish a new Eligible Deposit Account meeting the conditions specified above and transfer any cash or any investments from the affected account to such new account, and from the date such new account is established, it shall be the "Collection Account" or the "Excess Funding Account," as the case may be.
Funds on deposit in the Collection Account and the Excess Funding Account
shall, at the direction of Servicer, be invested by Indenture Trustee in
Eligible Investments selected by Servicer, except that funds on deposit in
either such account on any Transfer Date need not be invested through the
immediately following Distribution Date. All such Eligible Investments shall be
held by Indenture Trustee for the benefit of the Holders. Indenture Trustee
shall maintain for the benefit of the Holders possession of the negotiable
instruments or securities, if any, evidencing such Eligible Investments.
Investments of funds representing Collections collected during any Monthly
Period shall be invested in Eligible Investments that will mature so that all
funds will be available at the close of business on the Transfer Date following
such Monthly Period. No Eligible Investment shall be disposed of prior to its
maturity unless Servicer so directs and either (i) such disposal will not result
in a loss of all or part of the principal portion of such Eligible Investment or
(ii) prior to the maturity of such Eligible Investment, a default occurs in the
payment of principal, interest or any other amount with respect to such Eligible
Investment. On each Distribution Date, all interest and other investment
earnings (net of losses and investment expenses) on funds on deposit in the
Collection Account and the Excess Funding Account shall be treated as
Collections of Finance Charge Receivables with respect to the last day of the
related Monthly Period, except as otherwise specified in any Indenture
Supplement. For purposes of determining the availability of funds or the
balances in the Collection Account or the Excess Funding Account for any reason
under this Agreement, all investment earnings net of investment expenses and
losses on such funds shall be deemed not to be available or on deposit. In no
event shall Indenture Trustee be liable for the selection of investments or for
investment losses incurred thereon. Indenture Trustee shall have no liability in
respect of losses incurred as a result of the liquidation of any such investment
prior to its stated maturity or the failure of the party directing such
investment to provide timely written investment direction. Indenture Trustee
shall have no obligation to invest or reinvest any amounts held hereunder in the
absence of such written investment direction.
Unless otherwise directed by Servicer, funds on deposit in the Excess Funding Account will be withdrawn and paid to Transferor on any day to the extent that the Transferor Amount exceeds the Specified Transferor Amount on such day. On any Transfer Date on which one or more Series is in an
Amortization Period, Servicer shall determine the aggregate amounts of Principal Shortfalls, if any, with respect to each such Series that is a Principal Sharing Series (after giving effect to the allocation and payment provisions in the Indenture Supplement with respect to each such Series), and Servicer shall instruct Indenture Trustee to withdraw such amount from the Excess Funding Account (up to an amount equal to the lesser of (x) the amount on deposit in the Excess Funding Account after application of the preceding sentence on that day and (y) the amount, if any, by which the Transferor Amount would be less than zero if there were no funds on deposit in the Excess Funding Account on that day) on such Transfer Date and allocate such amount among each such Series as specified in each related Indenture Supplement.
Section 8.4 COLLECTIONS AND ALLOCATIONS. From and after Certificate Trust Termination Date:
(a) Servicer shall apply, or instruct Indenture Trustee to apply, all funds on deposit in the Collection Account as described in this ARTICLE VIII and in each Indenture Supplement. Except as otherwise provided below and in each Indenture Supplement, Servicer shall deposit Collections into the Collection Account no later than the second Business Day following the Date of Processing of such Collections. Except as otherwise required by any Indenture Supplement, a Credit Card Originator may permit or require payments owed by any Merchant with respect to In-Store Payments to be netted against amounts owed by that Credit Card Originator to that Merchant, and the Credit Card Originator or Servicer shall deposit into the Collection Account on each Business Day an amount equal to the aggregate amount of In-Store Payments netted against amounts owed by that Credit Card Originator to the various Merchants on that Business Day.
Subject to the express terms of any Indenture Supplement, but notwithstanding anything else in this Indenture to the contrary, if WFN remains Servicer and (x) for so long as WFN maintains a short term debt rating of A-1 or better by S&P, P-1 or better by Moody's, if rated by Fitch, F1 or better by Fitch, and, if rated by any other Rating Agency, the equivalent rating by that Rating Agency (or such other rating below A-1, P-1 or such equivalent rating, as the case may be, which is satisfactory to each Rating Agency, if any), (y) with respect to Collections allocable to any Series, any other conditions specified in the related Indenture Supplement are satisfied or (z) WFN has provided to Indenture Trustee a letter of credit, surety bond or other similar arrangement covering collection risk of Servicer and in each case acceptable to each Rating Agency (as evidenced by a letter from each Rating Agency to the effect that the Rating Agency Condition has been satisfied), if any, Servicer need not make the daily deposits of Collections into the Collection Account as provided in the preceding paragraph, but may make a single deposit in the Collection Account in immediately available funds not later than 12:00 noon, New York City time, on the related Transfer Date.
(b) On each Date of Processing, Collections of Finance Charge Receivables and of Principal Receivables shall be allocated to each Series of Notes in accordance with the related Indenture Supplement. On each
Determination Date, Defaulted Receivables will be allocated to each Series of Notes in accordance with the related Indenture Supplement.
(c) Throughout the existence of Issuer, unless otherwise stated in any Indenture Supplement, on each Date of Processing Servicer shall allocate to Transferor an amount equal to the product of (A) the Transferor Percentage and (B) the aggregate amount of Collections allocated to Principal Receivables and Finance Charge Receivables, respectively, on that Date of Processing; PROVIDED that, if the Transferor Amount (determined after giving effect to any transfer of Principal Receivables to the Trust on such date), is less than or equal to the Specified Transferor Amount, Servicer shall not allocate to Transferor any such amounts that otherwise would be allocated to Transferor, but shall instead deposit such funds in the Excess Funding Account. Unless otherwise stated in any Indenture Supplement, neither Servicer nor Transferor need deposit any amounts allocated to Transferor pursuant to the foregoing into the Collection Account and shall pay, or be deemed to pay, such amounts as collected to Transferor.
The payments to be made to Transferor, pursuant to this SECTION 8.4(c) do
not apply to deposits to the Collection Account or other amounts that do not
represent Collections, including payment of the purchase price for Receivables
pursuant to SECTION 2.4(f) or 7.1 of the Transfer and Servicing Agreement,
proceeds from the sale, disposition or liquidation of Receivables pursuant to
SECTION 5.5 or payment of the purchase price for the Notes of a specific Series
pursuant to the related Indenture Supplement.
Section 8.5 SHARED PRINCIPAL COLLECTIONS. From and after Certificate Trust Termination Date, on each Business Day, Shared Principal Collections may, at the option of Transferor, be applied (or held in the Collection Account for later application) as principal with respect to any Variable Interest or, so long as either no Series is in an Amortization Period or no Series that is in an Amortization Period will have a Principal Shortfall on the related Transfer Date (assuming no Early Amortization Event occurs), withdrawn from the Collection Account and paid to Transferor; and on each Transfer Date, (a) Servicer shall allocate Shared Principal Collections not previously so applied or paid to each applicable Principal Sharing Series, pro rata, in proportion to the Principal Shortfalls, if any, with respect to each such Series, and any remainder may, at the option of Transferor, be applied as principal with respect to any Variable Interest and (b) Servicer shall withdraw from the Collection Account and pay to Transferor any amounts representing Shared Principal Collections remaining after the allocations and applications referred to in CLAUSE (a); PROVIDED that, if, on any day the Transferor Amount (determined after giving effect to any transfer of Principal Receivables to the Trust on such day), is less than or equal to the Specified Transferor Amount, Servicer shall not distribute to Transferor any Shared Principal Collections that otherwise would be distributed to Transferor, but shall deposit such funds in the Excess Funding Account to the extent required so that the Transferor Amount equals the Specified Transferor Amount. Notwithstanding the foregoing, during any Amortization Period for any Series (other than a Variable Interest), Transferor may not apply Shared Principal Collections as
principal with respect to any Variable Interest, unless such application of principal is made on any Transfer Date or related Distribution Date after the application of Shared Principal Collections pursuant to the various Indenture Supplements.
Section 8.6 EXCESS FINANCE CHARGE COLLECTIONS. From and after Certificate
Trust Termination Date, on each Transfer Date, (a) for each Group, Servicer
shall allocate the aggregate amount for all outstanding Series in such Group of
the amounts which the related Indenture Supplements specify are to be treated as
"Excess Finance Charge Collections" for such Transfer Date to each Series in
such Group, pro rata, in proportion to the Finance Charge Shortfalls, if any,
with respect to each such Series, and (b) Servicer shall on the related
Distribution Date withdraw (or shall instruct Indenture Trustee in writing to
withdraw) from the Collection Account and pay to Transferor an amount equal to
the excess, if any, of (x) the aggregate amount for all outstanding Series in a
Group of the amounts which the related Indenture Supplements specify are to be
treated as "Excess Finance Charge Collections" for such Distribution Date over
(y) the aggregate amount for all outstanding Series in such Group which the
related Indenture Supplements specify are "Finance Charge Shortfalls", for such
Distribution Date.
Section 8.7 RELEASE OF COLLATERAL; ELIGIBLE LOAN DOCUMENTS.
(a) Upon the written direction of Issuer, Indenture Trustee may, and when required by the provisions of this Indenture shall, execute instruments to release property from the lien of this Indenture, or convey Indenture Trustee's interest in the same, in a manner and under circumstances which are not inconsistent with the provisions of this Indenture. No party relying upon an instrument executed by Indenture Trustee as provided in this ARTICLE VIII shall be bound to ascertain Indenture Trustee's authority, inquire into the satisfaction of any conditions precedent or see to the application of any monies.
(b) In order to facilitate the servicing of the Receivables by Servicer, Indenture Trustee upon Issuer Order shall authorize Servicer to execute in the name and on behalf of Indenture Trustee instruments of satisfaction or cancellation, or of partial or full release or discharge, and other comparable instruments with respect to the Receivables (and Indenture Trustee shall execute any such documents on written request of Servicer), subject to the obligations of Servicer under the Transfer and Servicing Agreement.
(c) Indenture Trustee shall, at such time as there are no Notes outstanding, release and transfer, without recourse, all of the Collateral that secured the Notes (other than any cash held for the payment of the Notes pursuant to SECTION 4.2). Indenture Trustee shall release property from the lien of this Indenture pursuant to this SECTION 8.9(c) only upon receipt of an Issuer Order accompanied by an Officer's Certificate, an Opinion of Counsel and (if required by the TIA) Independent Certificates in accordance with TIA ss.314(c) and 314(d)(1) meeting the applicable requirements of SECTION 12.1.
(d) Notwithstanding anything to the contrary in this Indenture, the Transfer and Servicing Agreement and the Trust Agreement, immediately prior to the release of any portion of the Collateral or any funds on deposit in the Series Accounts pursuant to this Indenture, Indenture Trustee shall at the written request of Issuer remit to Transferor for its own account any funds that, upon such release, would otherwise be remitted to Issuer.
Section 8.8 OPINION OF COUNSEL. Indenture Trustee shall receive at least
seven (7) days notice when requested by Issuer to take any action pursuant to
SECTION 8.7(a), accompanied by copies of any instruments involved, and Indenture
Trustee shall also be provided with, as a condition to such action, an Opinion
of Counsel stating the legal effect of any such action, outlining the steps
required to complete the same, and concluding that all conditions precedent to
the taking of such action have been complied with and such action will not
materially and adversely impair the security for the Notes or the rights of the
Noteholders in contravention of the provisions of this Indenture; PROVIDED,
HOWEVER, that such Opinion of Counsel shall not be required to express an
opinion as to the fair value of the Collateral. Indenture Trustee and counsel
rendering any such opinion may conclusively rely, without independent
investigation, on the accuracy and validity of any certificate or other
instrument delivered to Indenture Trustee in connection with any such action.
ARTICLE IX
DISTRIBUTIONS AND REPORTS TO NOTEHOLDERS
Distributions shall be made to, and reports shall be provided to, Noteholders as set forth in the applicable Indenture Supplement. The identity of the Noteholders with respect to distributions and reports shall be determined according to the immediately preceding Record Date.
ARTICLE X
SUPPLEMENTAL INDENTURES
Section 10.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF NOTEHOLDERS.
(a) Without the consent of the Holders of any Notes but with prior notice to each Rating Agency with respect to the Notes of all Series rated by such Rating Agency, Issuer and Indenture Trustee, when authorized by an Issuer Order, at any time and from time to time, may enter into one or more indentures supplemental hereto (which shall conform to the provisions of the TIA as in force at the date of the execution thereof), in form satisfactory to Indenture Trustee, for any of the following purposes:
(i) to correct or amplify the description of any property at any time subject to the lien of this Indenture, or better to assure, convey and confirm unto Indenture Trustee any property subject or required to be
subjected to the lien of this Indenture, or to subject to the lien of this Indenture additional property;
(ii) to evidence the succession, in compliance with SECTION 3.11, of another person to Issuer, and the assumption by any such successor of the covenants of Issuer contained herein and in the Notes;
(iii) to add to the covenants of Issuer, for the benefit of the Holders of the Notes, or to surrender any right or power herein conferred upon Issuer;
(iv) to convey, transfer, assign, mortgage or pledge any property to or with Indenture Trustee;
(v) to cure any ambiguity, to correct or supplement any provision herein or in any supplemental indenture that may be inconsistent with any other provision herein or in any supplemental indenture or to make any other provisions with respect to matters or questions arising under this Indenture or in any supplemental indenture; PROVIDED that such action shall not adversely affect the interests of the Holders of the Notes;
(vi) to evidence and provide for the acceptance of the appointment hereunder by a successor indenture trustee with respect to the Notes and to add to or change any of the provisions of this Indenture as shall be necessary to facilitate the administration of the trusts hereunder by more than one indenture trustee, pursuant to the requirements of ARTICLE VI;
(vii) to modify, eliminate or add to the provisions of this Indenture to such extent as shall be necessary to effect the qualification of this Indenture under the TIA or under any similar federal statute hereafter enacted and to add to this Indenture such other provisions as may be expressly required by the TIA; or
(viii) to provide for the issuance of one or more new Series of Notes, in accordance with the provisions of SECTION 2.11.
Indenture Trustee is hereby authorized to join in the execution of any such supplemental indenture and to make any further appropriate agreements and stipulations that may be therein contained.
(b) Issuer and Indenture Trustee, when authorized by an Issuer Order, may, also without the consent of any Noteholders of any Series then Outstanding but upon satisfaction of the Rating Agency Condition with respect to the Notes of all Series, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, or changing in any manner or eliminating any of the provisions of, this Indenture or of modifying in any manner the rights of the Holders of the Notes under this Indenture; PROVIDED, HOWEVER that Transferor shall have delivered to the Owner Trustee and Indenture Trustee (i) an
Officer's Certificate, dated the date of any such action, stating that all requirements for such amendments contained in the Agreement have been met and Transferor reasonably believes that such action will not have an Adverse Effect and (ii) a Tax Opinion. Additionally, notwithstanding the preceding sentence, Issuer and Indenture Trustee, when authorized by an Issuer Order, may, without the consent of any Noteholders of any Series then Outstanding or the Enhancement Providers for any Series, enter into an indenture or indentures supplemental hereto to add, modify or eliminate such provisions as may be necessary or advisable in order to enable all or a portion of Issuer (i) to qualify as, and to permit an election to be made to cause Issuer to be treated as, a "financial asset securitization investment trust" as described in the provisions of Section 860L of the Code, and (ii) to avoid the imposition of state or local income or franchise taxes imposed on Issuer's property or its income; PROVIDED, HOWEVER, that (i) Transferor delivers to Indenture Trustee and the Owner Trustee an Officer's Certificate to the effect that the proposed amendments meet the requirements set forth in this SECTION 10.1(b), (ii) the Rating Agency Condition will have been satisfied and (iii) such amendment does not affect the rights, duties, protections, indemnities, immunities or obligations of Indenture Trustee or the Owner Trustee hereunder. The amendments which Transferor may make without the consent of Noteholders pursuant to the preceding sentence may include the addition of Receivables.
Section 10.2 SUPPLEMENTAL INDENTURES WITH CONSENT OF NOTEHOLDERS. Issuer and Indenture Trustee, when authorized by an Issuer Order, also may, upon satisfaction of the Rating Agency Condition and with the consent of the Holders of Notes representing more than 66-2/3% of the principal balance of the Outstanding Notes of each adversely affected Series, by Act of such Holders delivered to Issuer and Indenture Trustee, enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to, changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of such Noteholders under this Indenture; PROVIDED, HOWEVER that no such supplemental indenture shall, without the consent of the Holder of each outstanding Note affected thereby:
(a) change the due date of any installment of principal of or interest on any Note, or reduce the principal amount thereof, the interest rate specified thereon or the redemption price with respect thereto or change any place of payment where, or the coin or currency in which, any Note or any interest thereon is payable;
(b) impair the right to institute suit for the enforcement of the provisions of this Indenture requiring the application of funds available therefor, as provided in ARTICLE V, to the payment of any such amount due on the Notes on or after the respective due dates thereof (or, in the case of redemption, on or after the Redemption Date);
(c) reduce the percentage of the Outstanding Notes of any Series the consent of the Holders of which is required for any such supplemental indenture, or the consent of the Holders of which is required for any waiver of compliance
with certain provisions of this Indenture or certain defaults hereunder and their consequences as provided for in this Indenture;
(d) reduce the percentage of the Outstanding Notes of any Series, the consent of the Holders of which is required to direct Indenture Trustee to sell or liquidate the Collateral if the proceeds of such sale would be insufficient to pay the principal amount and accrued but unpaid interest on the outstanding Notes of such Series;
(e) decrease the percentage of the Outstanding Notes required to amend the sections of this Indenture which specify the applicable percentage of the Outstanding Notes of any Series necessary to amend the Indenture or any Transaction Documents which require such consent;
(f) modify or alter the provisions of this Indenture prohibiting the voting of Notes held by Issuer, any other Obligor on the Notes, a Transferor or any affiliate thereof; or
(g) permit the creation of any Lien ranking prior to or on a parity with the lien of this Indenture with respect to any part of the Collateral for any Notes or, except as otherwise permitted or contemplated herein, terminate the Lien of this Indenture on any such Collateral at any time subject hereto or deprive the Holder of any Note of the security provided by the Lien of this Indenture.
Indenture Trustee may in its discretion determine whether or not any Notes would be affected by any supplemental indenture and any such determination shall be conclusive upon the Holders of all Notes, whether theretofore or thereafter authenticated and delivered hereunder. Indenture Trustee shall not be liable for any such determination made in good faith.
Satisfaction of the Rating Agency Condition shall not be required with respect to the execution of any supplemental indenture pursuant to this SECTION 10.2 for which the consent of all of the affected Noteholders is required; provided that prior notice of any such supplemental indenture shall be given to each Rating Agency.
It shall not be necessary for any Act of Noteholders under this SECTION 10.2 to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof.
Promptly after the execution by Issuer and Indenture Trustee of any supplemental indenture pursuant to this SECTION 10.2, Indenture Trustee shall mail to the Holders of the Notes to which such amendment or supplemental indenture relates written notice setting forth in general terms the substance of such supplemental indenture. Any failure of Indenture Trustee to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such supplemental indenture.
Section 10.3 EXECUTION OF SUPPLEMENTAL INDENTURES. In executing, or permitting the additional trusts created by, any supplemental indenture permitted by this ARTICLE X or the modification thereby of the trusts created by this Indenture, Indenture Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture and stating that all requisite consents have been obtained or that no consents are required and stating that such supplemental indenture or modification constitutes the legal, valid and binding obligation of Issuer in accordance with its terms. Indenture Trustee may, but shall not be obligated to, enter into any such supplemental indenture that affects Indenture Trustee's own rights, duties, liabilities or immunities under this Indenture or otherwise.
Section 10.4 EFFECT OF SUPPLEMENTAL INDENTURE. Upon the execution of any supplemental indenture under this ARTICLE X, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes, and every Holder of Notes theretofore or thereafter authenticated and delivered hereunder shall be bound thereby. This SECTION 10.4 does not apply to Indenture Supplements.
Section 10.5 CONFORMITY WITH TRUST INDENTURE ACT. Every amendment of this Indenture and every supplemental indenture executed pursuant to this ARTICLE X shall conform to the requirements of the TIA as then in effect so long as this Indenture shall then be qualified under the TIA.
Section 10.6 REFERENCE IN NOTES TO SUPPLEMENTAL INDENTURES. Notes authenticated and delivered after the execution of any supplemental indenture pursuant to this ARTICLE X may, and if required by Indenture Trustee shall, bear a notation in form approved by Indenture Trustee as to any matter provided for in such supplemental indenture. If Issuer shall so determine, new Notes so modified as to conform, in the opinion of Indenture Trustee and Issuer, to any such supplemental indenture may be prepared and executed by Issuer and authenticated and delivered by Indenture Trustee in exchange for the outstanding Notes.
ARTICLE XI
TERMINATION
Section 11.1 TERMINATION OF ISSUER. Issuer and the respective obligations
and responsibilities of Indenture Trustee created hereby (other than the
obligation of Indenture Trustee to make payments to Noteholders as hereinafter
set forth) shall terminate, except with respect to the duties described in
SECTION 11.2(b), as provided in the Trust Agreement.
Section 11.2 FINAL DISTRIBUTION.
(a) Servicer shall give Indenture Trustee and the Rating Agencies at least thirty (30) days prior written notice of the Distribution Date on which the Noteholders of any Series or Class may surrender their Notes for payment of the
final distribution on and cancellation of such Notes (or, in the event of a final distribution resulting from the application of SECTION 2.6 or 7.1 of the Transfer and Servicing Agreement or Section 5.5, notice of such Distribution Date promptly after Servicer has determined that a final distribution will occur, if such determination is made less than thirty (30) days prior to such Distribution Date). Such notice shall be accompanied by an Officer's Certificate setting forth the information specified in SECTION 3.5 of the Transfer and Servicing Agreement 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 Noteholders, Indenture Trustee shall provide notice to Noteholders 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 Notes 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 Notes at the office or offices therein specified (which in the case of Bearer Notes shall be outside the United States). Indenture Trustee shall give such notice to Transfer Agent and Registrar and Paying Agent at the time such notice is given to Noteholders.
(b) Notwithstanding a final distribution to the Noteholders of any Series or Class (or the termination of Issuer), except as otherwise provided in this paragraph, all funds then on deposit in the Collection Account and any Series Account allocated to such Noteholders shall continue to be held in trust for the benefit of such Noteholders and Paying Agent or Indenture Trustee shall pay such funds to such Noteholders upon surrender of their Notes, if certificated (and any excess shall be paid in accordance with the terms of any Enhancement Agreement). If all such Noteholders shall not surrender their Notes for cancellation within six (6) months after the date specified in the notice from Indenture Trustee described in PARAGRAPH (a), Indenture Trustee shall give a second notice to the remaining such Noteholders to surrender their Notes for cancellation and receive the final distribution with respect thereto (which surrender and payment, in the case of Bearer Notes, shall be outside the United States). If within one year after the second notice all such Notes shall not have been surrendered for cancellation, Indenture Trustee may take appropriate steps, or may appoint an agent to take appropriate steps, to contact the remaining such Noteholders concerning surrender of their Notes, 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 Noteholders. Indenture Trustee and, upon the written request of Servicer, Paying Agent shall pay to Issuer any monies held by them for the payment of principal or interest that remains unclaimed for two (2) years. After payment to Issuer, Noteholders entitled to the money must look to Issuer for payment as general creditors unless an applicable abandoned property law designates another Person.
Section 11.3 ISSUER'S TERMINATION RIGHTS. Upon the termination of Issuer pursuant to the terms of the Trust Agreement and upon the written direction of Issuer, Indenture Trustee shall assign and convey to the Holders of the Transferor
Interest or any of their designees, without recourse, representation or
warranty, all right, title and interest of Issuer in the Receivables, whether
then existing or thereafter created, all Recoveries related thereto all monies
due or to become due and all amounts received or receivable 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 Indenture Trustee pursuant
to SECTION 11.2(b). Indenture Trustee shall execute and deliver such instruments
of transfer and assignment, in each case without recourse, as shall be
reasonably requested in writing by the Holders of the Transferor Interest to
vest in the Holders of the Transferor Interest or any of their designees all
right, title and interest which Indenture Trustee had in the Collateral and such
other property.
ARTICLE XII
MISCELLANEOUS
Section 12.1 COMPLIANCE CERTIFICATES AND OPINIONS ETC.
(a) Upon any application or request by Issuer to Indenture Trustee to take any action under any provision of this Indenture, Indenture Trustee shall be entitled to request that Issuer furnish to Indenture Trustee (i) an Officer's Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with (ii) an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with and (iii) (if required by the TIA) an Independent Certificate from a firm of certified public accountants meeting the applicable requirements of this SECTION 12.1, except that, in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture, no additional certificate or opinion need be furnished.
Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include:
(i) a statement that each signatory of such certificate or opinion has read or has caused to be read such covenant or condition and the definitions herein relating thereto;
(ii) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;
(iii) a statement that, in the opinion of each such signatory, such signatory has made such examination or investigation as is necessary to enable such signatory to express an informed opinion as to whether or not such covenant or condition has been complied with; and
(iv) a statement as to whether, in the opinion of each such signatory, such condition or covenant has been complied with.
(b) (i) Prior to the deposit of any Collateral or other property or securities with Indenture Trustee that is to be made the basis for the release of any property or securities subject to the lien of this Indenture, Issuer shall, in addition to any obligation imposed in subsection 12.1(a) or elsewhere in this Indenture, furnish to Indenture Trustee an Officer's Certificate certifying or stating the opinion of each person signing such certificate as to the fair value (within ninety (90) days of such deposit) to Issuer of the Collateral or other property or securities to be so deposited.
(ii) Whenever Issuer is required to furnish to Indenture Trustee an Officer's Certificate certifying or stating the opinion of any signer thereof as to the matters described in clause (i) above, Issuer shall also deliver to Indenture Trustee (if required by the TIA) an Independent Certificate as to the same matters, if the fair value of Issuer of the securities to be so deposited and of all other such securities made the basis of any such withdrawal or release since the commencement of the then current fiscal year of Issuer, as set forth in the certificates delivered pursuant to clause (i) above and this clause (ii), is 10% or more of the Outstanding Amount of the Notes, but such a certificate need not be furnished with respect to any securities so deposited if the fair value thereof to Issuer as set forth in the related Officer's Certificate is less than $25,000 or less than one percent of the Outstanding Amount of the Notes.
(iii) Other than with respect to the release of any Defaulted Receivables and Receivables in Removed Accounts, whenever any property or investment property is to be released from the lien of this Indenture, Issuer shall also furnish to Indenture Trustee an Officer's Certificate certifying or stating the opinion of each person signing such certificate as to the fair value (within ninety (90) days of such release) of the property or securities proposed to be released and stating that in the opinion of such person the proposed release will not impair the security under this Indenture in contravention of the provisions hereof.
(iv) Whenever Issuer is required to furnish to Indenture Trustee an Officer's Certificate certifying or stating the opinion of any signer thereof as to the matters described in clause (iii) above, Issuer shall also furnish to Indenture Trustee (if required by the TIA) an Independent Certificate as to the same matters if the fair value of the property or securities and of all other property, other than Defaulted Receivables and Receivables in Removed Accounts, or securities released from the lien of this Indenture since the commencement of the then current calendar year, as set forth in the certificates required by clause (iii) above and this clause (iv), equals 10% or more of the Outstanding Amounts of the Notes, but such certificate need not be furnished in the case of any release of property or securities if the fair value thereof as set forth in the related Officer's Certificate is less than $25,000 or less than one percent of the then Outstanding Amount of the Notes.
(v) Notwithstanding any other provision of this SECTION 12.1, Issuer may (A) collect, liquidate, sell or otherwise dispose of Receivables as and to the extent permitted or required by the Transaction Documents and (B) make cash payments out of the Series Accounts as and to the extent permitted or required by the Transaction Documents.
Section 12.2 FORM OF DOCUMENTS DELIVERED TO INDENTURE TRUSTEE. In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.
Any certificate or opinion of a Responsible Officer of Issuer may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which such officer's certificate or opinion is based are erroneous. Any such certificate of a Responsible Officer or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of Servicer, a Transferor, Issuer or Administrator, stating that the information with respect to such factual matters is in the possession of Servicer, a Transferor, Issuer or Administrator, unless such Responsible Officer or Counsel has actual knowledge that the certificate or opinion or representations with respect to such matters are erroneous.
Where any Person is required to make, give or execute two (2) or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument.
Whenever in this Indenture, in connection with any application or certificate or report to Indenture Trustee, it is provided that Issuer shall deliver any document as a condition of the granting of such application, or as evidence of Issuer's compliance with any term hereof, it is intended that the truth and accuracy, at the time of the granting of such application or at the effective date of such certificate or report (as the case may be), of the facts and opinions stated in such document shall in such case be conditions precedent to the right of Issuer to have such application granted or to the sufficiency of such certificate or report. The foregoing shall not, however, be construed to affect Indenture Trustee's right to conclusively rely upon the truth and accuracy of any statement or opinion contained in any such document as provided in ARTICLE VI.
Section 12.3 ACTS OF NOTEHOLDERS.
(a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Noteholders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Noteholders in person or by their agents duly appointed in writing and satisfying any requisite percentages as to minimum number or dollar value of outstanding principal amount represented by such Noteholders; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to Indenture Trustee, and, where it is hereby expressly required, to Issuer. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the "ACT" of the Noteholders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and conclusive in favor of Indenture Trustee and Issuer, if made in the manner provided in this SECTION 12.3.
(b) The fact and date of the execution by any Person of any such instrument or writing may be proved in any manner which Indenture Trustee deems sufficient.
(c) The ownership of Notes shall be proved by the Note Register.
(d) Any request, demand, authorization, direction, notice, consent, waiver or other action by the Holder of any Notes shall bind the Holder (and any transferee thereof) of every Note issued upon the registration thereof in exchange therefor or in lieu thereof, in respect of anything done, omitted or suffered to be done by Indenture Trustee or Issuer in reliance thereon, whether or not notation of such action is made upon such Note.
Section 12.4 NOTICES, ETC. TO INDENTURE TRUSTEE AND ISSUER. Any request, demand, authorization, direction, notice, consent, waiver or Act of Noteholders or other documents provided or permitted by the Agreement to be made upon, given or furnished to, or filed with:
(a) Indenture Trustee by any Noteholder or by Issuer shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to a Trustee Officer, by facsimile transmission or by other means acceptable to Indenture Trustee to or with Indenture Trustee at its Corporate Trust Office; or
(b) Issuer by Indenture Trustee or by any Noteholder shall be sufficient for every purpose hereunder if in writing and mailed, first-class postage prepaid, to Issuer addressed to it and received by it c/o Chase Manhattan Bank USA, National Association, c/o JP Morgan Chase, 500 Stanton Christiana Rd., OPS4/3rd Floor, Newark, DE 19713, Attn: Institutional Trust Services, or at any other address previously furnished in writing to Indenture Trustee by Issuer. A copy of each notice to Issuer shall be sent in writing and mailed, first-class
postage prepaid, to Administrator at World Financial Network National Bank, 800 Techcenter Drive, Gahanna, Ohio 43230, Attn.: President.
Section 12.5 NOTICES TO NOTEHOLDERS; WAIVER. Where the Indenture provides for notice to Noteholders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed by registered or certified mail or first class postage prepaid or national overnight courier service to each Noteholder affected by such event, at its address as it appears on the Note Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice. In any case where notice to Noteholders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Noteholder shall affect the sufficiency of such notice with respect to other Noteholders, and any notice which is mailed in the manner herein provided shall conclusively be presumed to have been duly given.
Where this Indenture provides for notice in any manner, such notice may be waived in writing by any Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Noteholders shall be filed with Indenture Trustee but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.
In the event that, by reason of the suspension of regular mail service as a result of a strike, work stoppage or similar activity, it shall be impractical to mail notice of any event to Noteholders when such notice is required to be given pursuant to any provision of this Indenture, then any manner of giving such notice as shall be satisfactory to Indenture Trustee shall be deemed to be a sufficient giving of such notice.
Where this Indenture provides for notice to any Rating Agency, failure to give such notice shall not affect any other rights or obligations created hereunder and shall not under any circumstance constitute a Default or Event of Default.
Section 12.6 ALTERNATE PAYMENT AND NOTICE PROVISIONS. Notwithstanding any provision of this Indenture or any of the Notes to the contrary, Issuer, with the prior written consent of Indenture Trustee, may enter into any agreement with any Holder of a Note providing for a method of payment, or notice by Indenture Trustee or any Paying Agent to such Holder, that is different from the methods provided for in this Indenture for such payments or notices. Issuer will furnish to Indenture Trustee a copy of each such agreement and Indenture Trustee will cause payments to be made and notices to be given in accordance with such agreements.
Section 12.7 CONFLICT WITH TRUST INDENTURE ACT. If any provision hereof limits, qualifies or conflicts with another provision hereof that is required to be included in this indenture by any of the provisions of the TIA, such required provision shall control.
The provisions of TIA ss.ss.310 through 317 that impose duties on any person (including the provisions automatically deemed included herein unless expressly excluded by this Indenture) are a part of and govern this Indenture, whether or not physically contained herein.
Section 12.8 EFFECT OF HEADINGS AND TABLE OF CONTENTS. The Article and
Section headings herein and the Table of Contents are for convenience only and
shall not affect the construction hereof.
Section 12.9 SUCCESSORS AND ASSIGNS. All covenants and agreements in this Indenture by Issuer shall bind its successors and assigns, whether so expressed or not.
Section 12.10 SEPARABILITY. In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality, and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.
Section 12.11 BENEFITS OF INDENTURE. Nothing in this Indenture or in the Notes, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder, and the Noteholders, Servicer and Transferor, any benefit.
Section 12.12 LEGAL HOLIDAYS. In any case where the date on which any payment is due shall not be a Business Day, then (notwithstanding any other provision of the Notes or this Indenture) payment need not be made on such date, but may be made on the next succeeding Business Day with the same force and effect as if made on the date on which nominally due, and no interest shall accrue for the period from and after any such nominal date.
Section 12.13 GOVERNING LAW. THIS INDENTURE AND EACH NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY CONFLICT THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS CHOICE OF LAW PROVISIONS AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 12.14 COUNTERPARTS. This Indenture may be executed in any number of counterparts (and by different parties on separate counterparts), each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.
Section 12.15 ISSUER OBLIGATION. No recourse may be taken, directly or indirectly, with respect to the obligations of Issuer on the Notes or under this Indenture or any certificate or other writing delivered in connection herewith or therewith, against (i) Indenture Trustee or the Owner Trustee in its individual capacity, (ii) any owner of a beneficial interest in Issuer or (iii) any partner, owner, beneficiary, agent, officer, director, employee or agent of Indenture Trustee or the Owner Trustee in its individual capacity, any holder of a beneficial
interest in Issuer, the Owner Trustee or Indenture Trustee or of any successor or assign of Indenture Trustee or the Owner Trustee in its individual capacity, except as any such Person may have expressly agreed (it being understood that Indenture Trustee and the Owner Trustee have no such obligations in their individual capacity) and except that any such partner, owner or beneficiary shall be fully liable, to the extent provided by applicable law, for any unpaid consideration for stock, unpaid capital contribution or failure to pay any installment or call owing to such entity. For all purposes of this Indenture, the Owner Trustee shall be subject to, and entitled to the benefits of, the terms and provisions of ARTICLES V, VI and VII of the Trust Agreement.
Section 12.16 NO PETITION. Indenture Trustee, by entering into this Indenture, and each Noteholder, by accepting a Note, hereby covenant and agree that they will not at any time institute against Issuer, Transferor or Certificate Trust, or solicit or join or cooperate with or encourage any institution against Issuer, Transferor or Certificate Trust of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Notes, this Indenture or any of the Transaction Documents. The foregoing shall not limit the rights of Indenture Trustee to file any claim in or otherwise take any action with respect to any insolvency proceeding that was instituted against Issuer by any Person other than Indenture Trustee.
Section 12.17 SUBORDINATION. Issuer and each Noteholder by accepting a Note acknowledge and agree that such Note represents indebtedness of Issuer and does not represent an interest in any assets (other than the Trust Estate) of Transferor (including by virtue of any deficiency claim in respect of obligations not paid or otherwise satisfied from the Trust Estate and proceeds thereof). In furtherance of and not in derogation of the foregoing, to the extent Transferor enters into other securitization transactions, Issuer as well as each Noteholder by accepting a Note acknowledge and agree that it shall have no right, title or interest in or to any assets (or interest therein) (other than Trust Estate) conveyed or purported to be conveyed by Transferor to another securitization trust or other Person or Persons in connection therewith (whether by way of a sale, capital contribution or by virtue of the granting of a lien) ("Other Assets"). To the extent that, notwithstanding the agreements and provisions contained in the preceding sentences of this subsection, Issuer or any Noteholder either (i) asserts an interest or claim to, or benefit from, Other Assets, whether asserted against or through Transferor or any other Person owned by Transferor, or (ii) is deemed to have any such interest, claim or benefit in or from Other Assets, whether by operation of law, legal process, pursuant to applicable provisions of insolvency laws or otherwise (including by virtue of SECTION 1111(b) of the Federal Bankruptcy Code or any successor provision having similar effect under the Bankruptcy Code), and whether deemed asserted against or through Transferor or any other Person owned by Transferor, then Issuer and each Noteholder by accepting a Note further acknowledges and agrees that any such interest, claim or benefit in or from Other Assets is and shall be expressly subordinated to the indefeasible payment in full
of all obligations and liabilities of Transferor which, under the terms of the relevant documents relating to the securitization of such Other Assets, are entitled to be paid from, entitled to the benefits of, or otherwise secured by such Other Assets (whether or not any such entitlement or security interest is legally perfected or otherwise entitled to a priority of distribution or application under applicable law, including insolvency laws, and whether asserted against Transferor or any other Person owned by Transferor), including, the payment of post-petition interest on such other obligations and liabilities. This subordination agreement shall be deemed a subordination agreement within the meaning of SECTION 510(a) of the Bankruptcy Code. Each Noteholder further acknowledges and agrees that no adequate remedy at law exists for a breach of this SECTION 12.17 and the terms of this SECTION 12.17 may be enforced by an action for specific performance.
IN WITNESS WHEREOF, Issuer and Indenture Trustee have caused this Indenture to be duly executed by their respective officers thereunto duly authorized, all as of the day and year first above written.
WORLD FINANCIAL NETWORK
CARD MASTER NOTE TRUST,
as Issuer
By: Chase Manhattan Bank USA,
National Association,
not in its individual capacity,
but solely as Owner Trustee
By: /s/ Denis Kelly --------------------------------- Name: Denis Kelly Title: Assistant Vice President |
BNY MIDWEST TRUST COMPANY,
as Indenture Trustee
By: /s/ Eric Lindahl --------------------------------- Name: Eric Lindahl Title: Assistant Vice President |
Acknowledged and Accepted:
WFN CREDIT COMPANY, LLC,
as Transferor
By: /s/ Robert P. Armiak
----------------------------------
Name: Robert P. Armiak
Title: Vice President and Treasurer
|
WORLD FINANCIAL NETWORK NATIONAL BANK,
as Servicer
By: /s/ Robert P. Armiak
----------------------------------
Name: Robert P. Armiak
Title: Vice President and Treasurer
|
MASTER INDENTURE SIGNATURE PAGE
ANNEX A
to
MASTER INDENTURE
DEFINITIONS
ANNEX A TO MASTER INDENTURE
DEFINITIONS
"ACCOUNT" means each open end credit card account designated as an "Account" pursuant to (and as defined in) the Pooling and Servicing Agreement on or prior to the Certificate Trust Termination Date. The term "Account" excludes any Account all the Receivables in which are either reassigned or assigned to Transferor or its designee or Servicer in accordance with the Pooling and Servicing Agreement or the Transfer and Servicing Agreement, and any inactive Accounts which in accordance with the Credit Card Guidelines have been removed from the computer records of the Credit Card Originator. The term "Account" includes each account into which an Account is transferred (a "TRANSFERRED ACCOUNT") so long as (a) such transfer is made in accordance with the Credit Card Guidelines and (b) such Transferred Account can be traced or identified, by reference to or by way of the Account Schedule delivered to the Owner Trustee pursuant to SECTION 2.1 or 2.6(d) of the Transfer and Servicing Agreement, as an account into which an Account has been transferred. The term "Account" includes an Automatic Additional Account or a Supplemental Account only from and after its Addition Date and includes any Removed Account only prior to its Removal Date.
"ACCOUNT SCHEDULE" means a computer file or microfiche list containing a
true and complete list of Accounts, identified by account number and setting
forth the Receivable balance as of (a) the Certificate Trust Termination Date
(for the Account Schedule delivered on the Certificate Trust Termination Date),
(b) the end of the related Monthly Period (for any Account Schedule relating to
Automatic Additional Accounts) or (c) the related Addition Cut Off Date (for any
Account Schedule delivered in connection with any designation of Supplemental
Accounts).
"ACQUIRED PORTFOLIO RECEIVABLE" means any receivable acquired by the Credit Card Originator from an Other Originator in connection with the Credit Card Originator's acquisition of a portfolio of revolving credit card accounts from such Other Originator (prior to the transfer of such receivable to the Transferor pursuant to the Receivables Purchase Agreement).
"ACQUIRING PERSON" is defined in SECTION 3.10(b) of the Indenture.
"ACT" is defined in SECTION 12.3(a) of the Indenture.
"ADDITION" means the designation of additional Eligible Accounts to be included as Accounts pursuant to SECTION 2.6(a), (b) or (c) of the Transfer and Servicing Agreement or of Participation Interests to be included as Trust Assets pursuant to SECTION 2.6(b) or (c) of the Transfer and Servicing Agreement, as applicable.
"ADDITION CUT OFF DATE" means the date as of which any Supplemental Accounts or Participation Interests are designated for inclusion in the Trust, as specified in the related Assignment.
"ADDITION DATE" means (a) as to Supplemental Accounts, the date on which
the Receivables in such Supplemental Accounts are conveyed to the Trust pursuant
to SECTION 2.6(b) or (c) of the Transfer and Servicing Agreement, as applicable,
(b) as to Automatic Additional Accounts, the date on which such accounts are
created or otherwise become Automatic Additional Accounts and (c) as to
Participation Interests, the date from and after which such Participation
Interests are to be included as Trust Assets pursuant to SECTION 2.6(b) or (c)
of the Transfer and Servicing Agreement.
"ADDITIONAL ACCOUNT" means an Automatic Additional Account or a Supplemental Account.
"ADDITIONAL LIMITATION EVENT" means the occurrence of either of the following events on any Determination Date:
(1) the average of the default ratio for that Determination Date and the preceding two Determination Dates is greater than 1.25%, where the "default ratio" for any Determination Date equals the percentage equivalent of a fraction (A) the numerator of which is the aggregate of the Default Amounts for all Accounts that became Defaulted Accounts during the related Monthly Period and (B) the denominator of which is the total Receivables as of the end of the sixth preceding Monthly Period; or
(2) the average of the payment rate for that Determination Date and the preceding two Determination Dates is less than 10%, where the "payment rate" for any Determination Date equals the percentage equivalent of a fraction (A) the numerator of which is the aggregate Collections received during the related Monthly Period and (B) the denominator of which is equal to the total Receivables held by the Receivables Trust at the close of business for the Monthly Period immediately prior to such related Monthly Period.
"ADMINISTRATION AGREEMENT" means the Administration Agreement, dated as of August 1, 2001 between the Issuer and the Administrator, as the same may be amended, supplemented or otherwise modified from time to time.
"ADMINISTRATOR" means WFN, its capacity as administrator, under the Administration Agreement, and any successor in that capacity.
"ADVERSE EFFECT" means, with respect to any action, that such action will
(a) result in the occurrence of an Early Amortization Event or an Event of
Default or (b) materially and adversely affect the amount or timing of
distributions to be made to the Noteholders of any Series or Class pursuant to
the Transaction Documents.
"AFFILIATE" means, as to any specified Person, any other Person controlling or controlled by or under common control with such specified Person. For this purpose, "control" means 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 "controlling" and "controlled" have correlative meanings.
"AGGREGATE PRINCIPAL BALANCE" means, as of any time of determination, the sum of (a) the Aggregate Principal Receivables and (b) the amount on deposit in the Excess Funding Account (exclusive of any investment earnings on such amount).
"AGGREGATE PRINCIPAL RECEIVABLES" means, as of any date of determination, the aggregate amount of Principal Receivables as of such date.
"ALLOCATION PERCENTAGE" is defined, for any Series, with respect to Principal Receivables, Finance Charge Receivables and Receivables in Defaulted Accounts, in the related Indenture Supplement.
"AMORTIZATION PERIOD" means, as to any Series or any Class within a Series, any period specified in the related Indenture Supplement during which a share of principal collections is set aside to repay the outstanding principal amount of that Series (excluding repayments of a Variable Interest during its revolving period).
"APPLICANTS" is defined in SECTION 2.9 of the Indenture.
"APPROVED PORTFOLIO" means any Identified Portfolio and any additional portfolio that is designated as an Approved Portfolio pursuant to SECTION 2.6(E) of the Transfer and Servicing Agreement or any portfolio that was designated as an "Approved Portfolio" (as defined in the Pooling and Servicing Agreement) pursuant to SECTION 2.8(e) of the Pooling and Servicing Agreement.
"ASSIGNMENT" is defined in SECTION 2.6(d)(ii) of the Transfer and Servicing Agreement.
"AUTHORIZED NEWSPAPER" means 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 Notes of such Series or Class are listed on the Luxembourg Stock Exchange and such exchange shall so require, in Luxembourg, printed in any language satisfying the requirements of such exchange) and customarily published on each business day at such place, whether or not published on Saturdays, Sundays or holidays.
"AUTHORIZED OFFICER" means:
(a) with respect to the Issuer, any officer of the Owner Trustee who is authorized to act for the Owner Trustee in matters relating to the Issuer and who is identified on the list of Authorized Officers, containing the specimen signature
of each such Person, delivered by the Owner Trustee to the Indenture Trustee on the Initial Closing Date (as such list may be modified or supplemented from time to time thereafter) and any Vice President or more senior officer of the Administrator who is authorized to act for the Administrator in matters relating to the Issuer and to be acted upon by the Administrator pursuant to the Administration Agreement and who is identified on the list of Authorized Officers (containing the specimen signatures of such officers) delivered by the Administrator to the Indenture Trustee on the Initial Closing Date (as such list may be modified or supplemented from time to time thereafter);
(b) with respect to the Transferor, any officer of the Transferor who is authorized to act for the Transferor in matters relating to the Transferor and who is identified on the list of Authorized Officers, containing the specimen signature of each such Person, delivered by the Transferor to the Indenture Trustee on the Initial Closing Date (as such list may be modified or supplemented from time to time thereafter); and
(c) with respect to the Servicer, any officer of the Servicer who is authorized to act for the Servicer in matters relating to the Servicer and who is identified on the list of Authorized Officers, containing the specimen signature of each such Person, delivered by the Servicer to the Indenture Trustee on the Initial Closing Date (as such list may be modified or supplemented from time to time thereafter).
"AUTOMATIC ADDITION LIMITATION EVENT" means the occurrence of either of the following events on any Determination Date:
(1) the average of the default ratio for that Determination Date and the preceding two Determination Dates is greater than 1%, where the "default ratio" for any Determination Date equals the percentage equivalent of a fraction (A) the numerator of which is the aggregate of the Default Amounts for all Accounts that became Defaulted Accounts during the related Monthly Period and (B) the denominator of which is the total Receivables held by the Receivables Trust as of the end of the sixth preceding Monthly Period; or
(2) the average of the payment rate for that Determination Date and the preceding two Determination Dates is less than 10%, where the "payment rate" for any Determination Date equals the percentage equivalent of a fraction (A) the numerator of which is the aggregate Collections received during the related Monthly Period and (B) the denominator of which is equal to the total Receivables held by the Receivables Trust at the close of business for the Monthly Period immediately prior to such related Monthly Period.
"AUTOMATIC ADDITION SUSPENSION DATE" is defined in SECTION 2.6(a) of the Transfer and Servicing Agreement.
"AUTOMATIC ADDITION TERMINATION DATE" is defined in SECTION 2.6(a) of the Transfer and Servicing Agreement.
"AUTOMATIC ADDITIONAL ACCOUNT" means each open end credit card account in
any Approved Portfolio that is established pursuant to a Credit Card Agreement
coming into existence after (a) the Certificate Trust Termination Date (in the
case of an Account in the Identified Portfolio or a portfolio that was
designated as an Approved Portfolio prior to the Certificate Trust Termination
Date) or (b) the Addition Cut Off Date relating to the first Addition Date on
which Receivables from Accounts in the applicable portfolio are transferred to
the Issuer (in the case of an account in any portfolio designated as an Approved
Portfolio after the Certificate Trust Termination Date) and, in either case,
prior to the Automatic Addition Termination Date or an Automatic Addition
Suspension Date, or subsequent to a Restart Date. In addition, Accounts in an
Approved Portfolio that were in existence, but were not Eligible Accounts, on
(x) the Certificate Trust Termination Date (in the case of an Account in the
Identified Portfolio or a portfolio that was designated as an Approved Portfolio
prior to the Certificate Trust Termination Date) or (y) the Addition Cut Off
Date relating to the first Addition Date on which Receivables from Accounts in
the applicable portfolio are transferred to the Trust (in the case of an account
in any other portfolio designated as an Approved Portfolio after the Certificate
Trust Termination Date) but which, in either case, become Eligible Accounts
prior to the Automatic Addition Termination Date or an Automatic Addition
Suspension Date, or subsequent to a Restart Date, shall also be "Automatic
Additional Accounts" and shall be deemed, for purposes of the definition of
"Eligible Account" and SECTION 2.6(a), to have been created on the first day
after the Certificate Trust Termination Date or applicable Addition Cut Off Date
on which they are Eligible Accounts.
"BASE RATE" is defined, with respect to any Series, in the related Indenture Supplement.
"BEARER NOTE" is defined in SECTION 2.1 of the Indenture.
"BOOK-ENTRY NOTES" means beneficial interests in the Notes, ownership and transfers of which shall be made through book entries by a Clearing Agency or Foreign Clearing Agency as described in SECTION 2.13 of the Indenture.
"BUSINESS DAY" means any day other than (a) a Saturday or Sunday, (b) any other day on which national banking associations or state banking institutions in New York, New York, Chicago, Illinois, Columbus, Ohio or Wilmington, Delaware are authorized or obligated by law, executive order or governmental decree to be closed or (c) for purposes of any particular Series, any other day specified in the related Indenture Supplement.
"BUSINESS TRUST STATUTE" shall mean Chapter 38 of Title 12 of the Delaware Code, 12 DEL. C. ss.3801, ET SEQ.
"CERTIFICATE OF TRUST" shall mean the Certificate of Trust in the form attached to the Trust Agreement as Exhibit A, which has been filed for the Issuer pursuant to Section 3810(a) of the Business Trust Statute.
"CERTIFICATE TRUST" means The World Financial Network Credit Card Master Trust.
"CERTIFICATE TRUST TERMINATION DATE" means the date on which the Certificate Trust is terminated and all of the Receivables held by the Certificate Trust are transferred to the Issuer.
"CERTIFICATE TRUST TRUSTEE" means the trustee under the Pooling and Servicing Agreement.
"CLASS" means, with respect to any Series, any one of the classes of Notes of that Series.
"CLEARING AGENCY" means an organization registered as a "clearing agency" pursuant to Section 17A of the Securities Exchange Act of 1934.
"CLEARING AGENCY PARTICIPANT" means 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" means Clearstream Banking, societe anonyme, a professional depository incorporated under the laws of Luxembourg, and its successors.
"CLOSING DATE" means, with respect to any Series, the closing date specified in the related Indenture Supplement.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COLLATERAL" is defined in the Granting Clause of the Indenture.
"COLLATERAL AMOUNT" is defined, with respect to any Series, in the related Indenture Supplement.
"COLLATERAL CERTIFICATE" means the certificate, representing an undivided interest in the assets held in the Certificate Trust, issued pursuant to the Pooling and Servicing Agreement and the Collateral Series Supplement, dated as of August 21, 2001, to the Pooling and Servicing Agreement.
"COLLATERAL SERIES SUPPLEMENT" means a supplement to the Pooling and Servicing Agreement, executed and delivered in connection with the original issuance of the Collateral Certificate pursuant to SECTION 6.3 of the Pooling and Servicing Agreement as the same may be amended, supplemented or otherwise modified from time to time.
"COLLECTION ACCOUNT" is defined in SECTION 8.3(a) of the Indenture.
"COLLECTIONS" means all payments (including Recoveries of Principal Receivables or Finance Charge Receivables and Insurance Proceeds, whether or
not treated as Recoveries) received by Servicer with respect to the Receivables, including In-Store Payments, in the form of cash, checks (to the extent collected), wire transfers or other form of payment in accordance with the Credit Card Agreement in effect from time to time on any Receivables. If so specified in any Indenture Supplement, Collections shall also include any payments received by Servicer with respect to Participation Interests.
"COMMISSION" means the Securities and Exchange Commission.
"CONVEYANCE PAPERS" is defined in SECTION 4.1(a)(iii) of the Receivables Purchase Agreement.
"CORPORATE TRUST OFFICE" means
(a) for the Indenture Trustee, the principal office at which at any particular time its corporate trust business shall be administered, which office at date of the execution of the Indenture is located at 2 North LaSalle Street, Suite 1020, Chicago, Illinois 60602, Attention: Structured Finance Services, or at such other address as the Indenture Trustee may designate from time to time by notice to the Noteholders and the Transferor, or the principal corporate trust office of any successor Indenture Trustee (the address of which the successor Indenture Trustee will notify the Noteholders and the Transferor);
(b) for the Owner Trustee, the principal office at which at any particular time its corporate trust business shall be administered, which office at date of the execution of the Indenture is located at c/o JP Morgan Chase, 500 Stanton Christiana Rd., OPS4/3rd Floor, Newark, DE 19713, Attn: Institutional Trust Services.
"COUPON" is defined in SECTION 2.1 of the Indenture.
"CREDIT ADJUSTMENT" is defined in the SECTION 3.2 of the Receivables Purchase Agreement.
"CREDIT CARD AGREEMENT" means, as to any Account, the agreements between the Credit Card Originator that owns the Account (including WFN as assignee of an Other Originator) and the related Obligor that govern the Account, as amended or otherwise modified from time to time.
"CREDIT CARD GUIDELINES" means the written policies and procedures of the Credit Card Originator relating to the operation of its consumer revolving lending business, including written policies and procedures for determining the creditworthiness of credit card customers, the extension of credit to credit card customers and the maintenance of credit card accounts and collection of related receivables, as amended or otherwise modified from time to time.
"CREDIT CARD ORIGINATOR" means (i) WFN and/or any transferee of the Accounts from WFN or (ii) any other originator of Accounts which is designated from time to time pursuant to SECTION 2.10 of the Transfer and Servicing
Agreement and, directly or indirectly, enters into a receivables purchase agreement with Transferor.
"CREDIT CARD PROCESSING AGREEMENT" means one or more agreements between the Credit Card Originator (including WFN as assignee of an Other Originator) and a Merchant pursuant to which the Credit Card Originator agrees to extend open end credit card accounts to customers of the Merchant and the Merchant agrees to allow purchases to be made at its retail establishments, or in its catalogue sales business, under such accounts.
"DAILY REPORT" is defined in SECTION 3.4(a) of the Transfer and Servicing Agreement.
"DATE OF PROCESSING" means, as to any transaction, the Business Day on which the transaction is first recorded on Servicer's computer file of consumer revolving accounts (without regard to the effective date of such recordation).
"DEBTOR" means the party designated in the Specified Agreement as the "Debtor" for purposes of the Perfection Representations and Warranties.
"DEBTOR RELIEF LAWS" means Title 11 of the United States Code and all other applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement, receivership, insolvency, reorganization, suspension of payments, readjustment of debt, marshalling of assets or similar debtor relief laws of the United States, any state or any foreign country from time to time in effect, affecting the rights of creditors generally.
"DEFAULT" means any occurrence that is, or with notice or the lapse of time or both would become, an Event of Default.
"DEFAULTED RECEIVABLE" means, as to any date of determination, all Principal Receivables in any Account which are charged off as uncollectible on that date in accordance with the Credit Card Guidelines and Servicer's customary and usual servicing procedures for servicing open end credit card account receivables comparable to the Receivables. A Principal Receivable in any Account shall become a Defaulted Receivable on the day on which such Principal Receivable is recorded as charged off in accordance with the Credit Card Guidelines.
"DEFINITIVE NOTES" means Notes in definitive, fully registered form.
"DEMAND NOTE" is defined in SECTION 2.9 of the Transfer and Servicing Agreement.
"DETERMINATION DATE" means, unless otherwise specified in any Indenture Supplement with respect to the related Series, the second Business Day preceding each Distribution Date.
"DISCOUNT OPTION RECEIVABLES" means, on any Date of Processing on and
after the date on which Transferor's exercise of its discount option pursuant to
SECTION 2.8 of the Transfer and Servicing Agreement takes effect, the sum of (a)
the aggregate Discount Option Receivables at the end of the prior day (which
amount, prior to the date on which Transferor's exercise of its discount option
takes effect and with respect to Receivables generated prior to such date, shall
be zero), plus (b) any New Discount Option Receivables created on such day,
minus (c) any Discount Option Receivables Collections received on such Date of
Processing.
"DISCOUNT OPTION RECEIVABLES COLLECTIONS" means on any Date of Processing on and after the date on which Transferor's exercise of its discount option pursuant to SECTION 2.8 of the Transfer and Servicing Agreement takes effect, the product of (a) a fraction the numerator of which is the amount of the Discount Option Receivables and the denominator of which is the sum of the Principal Receivables plus the amount of Discount Option Receivables in each case (for both numerator and denominator) at the end of the prior Monthly Period and (b) Collections of Principal Receivables, prior to any reduction for Finance Charge Receivables which are Discount Option Receivables, received on such Date of Processing.
"DISCOUNT PERCENTAGE" is defined in SECTION 2.8 of the Transfer and Servicing Agreement.
"DISTRIBUTION DATE" means, with respect to any Series, the date specified in the related Indenture Supplement.
"DOCUMENT DELIVERY DATE" means the Addition Date in the case of Supplemental Accounts and the Removal Date in the case of Removed Accounts.
"DOLLARS," "$" or "U.S. $" means United States dollars.
"DTC" means The Depository Trust Company.
"EARLY AMORTIZATION EVENT" means, as to any Series, each event, if any, specified in the relevant Indenture Supplement as an Early Amortization Event for that Series or a Trust Early Amortization Event.
"EFFECTIVE DATE" is defined in the Pooling and Servicing Agreement.
"ELIGIBLE ACCOUNT" means (a) with respect to "Accounts" designated pursuant to (and as defined in) the Pooling and Servicing Agreement prior to the Certificate Trust Termination Date, Accounts which are "Eligible Accounts" under (and as defined in) the Pooling and Servicing Agreement and (b) each Account which, as of the date of creation thereof (in the case of an Automatic Additional Account) or the related Addition Cut Off Date (in the case of a Supplemental Account):
(a) is in existence and is serviced by the Credit Card Originator or any Affiliate of the Credit Card Originator;
(b) is payable in United States dollars;
(c) except as provided below, has not been identified as an account (i) the credit cards for which have been reported to the Credit Card Originator or the related Other Originator (if any) as lost or stolen or (ii) the Obligor of which is the subject of a bankruptcy proceeding;
(d) none of the Receivables in which have been, sold, pledged, assigned or otherwise conveyed to any Person (except by an Other Originator to a Credit Card Originator, by a Credit Card Originator to the Transferor or otherwise pursuant to the Transfer and Servicing Agreement), unless any such pledge or assignment is released on or before the Addition Date;
(e) except as provided below, none of the Receivables in which are Defaulted Receivables or have been identified by the Credit Card Originator or the related Other Originator (if any), or by the relevant Obligor to the Credit Card Originator or the related Other Originator (if any), as having been incurred as a result of fraudulent use of a credit card; and
(f) has an Obligor who has provided as his or her most recent billing address, an address located in the United States or a United States military address, provided that an account shall not fail to be an "Eligible Account" solely due to the Obligor having provided a billing address not satisfying the foregoing if as of the end of the most recently ended Monthly Period (in the case of an Automatic Additional Account) or the related Addition Cut Off Date (in the case of a Supplemental Account) the aggregate Principal Receivables in Accounts the most recent billing address for which does not satisfy the foregoing made up less than 2% (or any higher percentage as to which the Rating Agency Condition has been satisfied) of the aggregate Principal Receivables.
Notwithstanding the foregoing, Eligible Accounts may include accounts, the receivables in which have been written off, or as to which the Credit Card Originator or related Other Originator (if any) believes the related Obligor is bankrupt and certain receivables that have been identified by the Obligor as having been incurred as a result of fraudulent use of credit cards or any credit cards have been reported to the Credit Card Originator or the related Other Originator (if any) as lost or stolen, so long as (1) the balance of all receivables included in such accounts is reflected on the books and records of the Credit Card Originator (and is treated for purposes of the Transaction Documents) as "zero" and (2) charging privileges with respect to all such accounts have been canceled and are not reinstated.
"ELIGIBLE DEPOSIT ACCOUNT" means either (a) a segregated account with an Eligible Institution or (b) a segregated trust account with the corporate trust department of a depository institution organized under the laws of the United States or any one of the states thereof, including the District of Columbia (or any
domestic branch of a foreign bank), and acting as a trustee for funds deposited in such account, so long as any of the securities of such depository institution shall have a credit rating from each of Moody's, S&P and, if rated by Fitch, Fitch in one of its generic credit rating categories that signifies investment grade.
"ELIGIBLE INSTITUTION" means (a) a depository institution (which may be the Owner Trustee or the Indenture Trustee or an affiliate thereof) organized under the laws of the United States or any one of the states thereof (i) that has either (A) a long-term unsecured debt rating of "A2" or better by Moody's or (B) a certificate of deposit rating of "P-1" by Moody's, (ii) that has either (A) a long-term unsecured debt rating of "AAA" by S&P or (B) a certificate of deposit rating of at least "A-1+" by S&P, (iii) that, if rated by Fitch, has either (A) a long-term unsecured debt rating of "AAA" by Fitch or (B) a certificate of deposit rating of at least "F-1+" by Fitch and (iv) the deposits of which are insured by the FDIC or (b) any other institution that is acceptable to each Rating Agency, Servicer and Trustee.
"ELIGIBLE INVESTMENTS" means book-entry securities, negotiable instruments or securities represented by instruments in bearer or registered form which evidence:
(a) direct obligations of, and obligations fully guaranteed as to timely payment of principal and interest by, the United States of America;
(b) demand deposits, time deposits or certificates of deposit (having original maturities of no more than 365 days) of depository institutions or trust companies incorporated under the laws of the United States of America or any state thereof (or domestic branches of foreign banks) and subject to supervision and examination by federal or state banking or depository institution authorities; provided that at the time of the Trust's investment or contractual commitment to invest therein, the short-term debt rating of such depository institution or trust company shall be in the highest investment category of each of Moody's and S&P, which in the case of S&P means A-1+, and, if rated by Fitch, Fitch;
(c) commercial paper or other short-term obligations having, at the time of the Trust's investment or contractual commitment to invest therein, a rating from each of Moody's and S&P in its highest investment category, which in the case of S&P means A-1+, and, if rated by Fitch, Fitch in its highest investment category;
(d) demand deposits, time deposits and certificates of deposit which are fully insured by the FDIC, with a Person the commercial paper of which has a credit rating from each of Moody's and S&P in its highest investment category, which in the case of S&P means A-1+, and, if rated by Fitch, Fitch in its highest investment category;
(e) notes or bankers acceptances (having original maturities of no more than 365 days) issued by any depository institution or trust company referred to in clause (b);
(f) investments in money market funds (including funds of the Owner Trustee or the Indenture Trustee or their affiliates as well as funds for which the Owner Trustee or the Indenture Trustee and their affiliates may receive compensation) rated in the highest investment category by each of Moody's and S&P, which in the case of S&P means A-1+, and, if rated by Fitch, Fitch in its highest investment category, or otherwise approved in writing by each Rating Agency;
(g) time deposits, other than as referred to in clause (d), with a Person the commercial paper of which has a credit rating in its highest investment category, from each of Moody's and S&P, which in the case of S&P means A-1+, and, if rated by Fitch, Fitch in its highest investment category; or
(h) any other investments as to which the Rating Agency Condition is satisfied, PROVIDED that making such investments shall not cause the Trust to be required to register as an investment company within the meaning of the Investment Company Act.
"ELIGIBLE RECEIVABLE" means a Receivable:
(a) that has arisen under an Eligible Account;
(b) that was created in compliance with the Credit Card Guidelines and all Requirements of Law applicable to the Credit Card Originator (or, in the case of an Acquired Portfolio Receivable, the related Other Originator) the failure to comply with which would have a material adverse effect on the Noteholders, and pursuant to a Credit Card Agreement that complies with all Requirements of Law applicable to the Credit Card Originator (and, in the case of an Acquired Portfolio Receivable, the related Other Originator during the time prior to the transfer of such Acquired Portfolio Receivable to the Credit Card Originator), the failure to comply with which would have a material adverse effect on the Noteholders;
(c) with respect to which all consents, licenses, approvals or authorizations of, or registrations with, any Governmental Authority required to be obtained or made by the Credit Card Originator (and, in the case of an Acquired Portfolio Receivable, the related Other Originator with respect to such actions prior to the transfer of such Acquired Portfolio Receivable to the Credit Card Originator) in connection with the creation of such Receivable or the execution, delivery and performance by the Credit Card Originator (and, in the case of an Acquired Portfolio Receivable, the related Other Originator with respect to such actions prior to the transfer of such Acquired Portfolio Receivable to the Credit Card Originator) of the related Credit Card Agreement, have been duly obtained or made and are in full force and effect as of the date of creation of such Receivable, but failure to comply with this clause (c) shall not cause a Receivable not to be an Eligible Receivable if, and to the extent that, the failure to so obtain or make any such consent, license, approval, authorization or registration would not have a material adverse effect on the Noteholders;
(d) as to which, at the time of its transfer to the Receivables Trust, Transferor or the Receivables Trust will have good and marketable title free and clear of all Liens (other than any Lien permitted by SECTION 2.5(b) of the Transfer and Servicing Agreement);
(e) that is the subject of a valid transfer and assignment (or the grant of a security interest) from Transferor to the Trust of all Transferor's right, title and interest therein;
(f) that at and after the time of transfer to the Receivables Trust is the legal, valid and binding payment obligation of the Obligor thereof, legally enforceable against such Obligor in accordance with its terms, except as enforceability may be limited by applicable Debtor Relief Laws, and by general principles of equity (whether considered in a suit at law or in equity);
(g) that constitutes an account;
(h) as to which, at the time of its transfer to the Receivables Trust, Transferor has not taken any action which, or failed to take any action the omission of which, would, at the time of transfer to the Receivables Trust, impair the rights therein of the Receivables Trust or the Holders;
(i) that, at the time of its transfer to the Receivables Trust, has not been waived or modified except as permitted in accordance with SECTION 3.3(h) of the Transfer and Servicing Agreement or the corresponding section of the Pooling and Servicing Agreement;
(j) that, at the time of its transfer to the Trust, is not subject to any right of rescission, setoff, counterclaim or any other defense of the Obligor (including the defense of usury), other than defenses arising out of Debtor Relief Laws and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or equity) or as to which Servicer makes an adjustment pursuant to SECTION 3.9; and
(k) as to which, at the time of its transfer to the Receivables Trust, the Transferor has satisfied all obligations to be fulfilled at the time it is transferred to the Receivables Trust.
"ELIGIBLE SERVICER" means the Indenture Trustee, a wholly owned subsidiary of the Indenture Trustee or an entity that, at the time of its appointment as Servicer: (a) is servicing a portfolio of consumer open end credit card accounts or other consumer open end credit accounts; (b) is legally qualified and has the capacity to service the Accounts; (c) is qualified (or licensed) to use the software that is then being used to service the Accounts or obtains the right to use, or has its own, software which is adequate to perform its duties under the Transfer and Servicing Agreement; (d) has, in the reasonable judgment of the Indenture Trustee, the ability to professionally and competently service a portfolio of similar accounts; and (e) has a net worth of at least $50,000,000 as of the end of its most recent fiscal quarter.
"ENHANCEMENT" means the rights and benefits provided to the Noteholders of any Series or Class pursuant to any letter of credit, surety bond, cash collateral account, guaranty collateral invested amount, spread account, guaranteed rate agreement, maturity guaranty facility, tax protection agreement, interest rate swap agreement, interest rate cap agreement or other similar arrangement. The subordination of any Class to another Class, or a cross support feature which requires collections on Receivables allocated to one Series to be paid as principal and/or interest with respect to another Series shall be deemed to be an Enhancement for the Class or Series benefiting from the subordination or cross support feature.
"ENHANCEMENT AGREEMENT" means any agreement, instrument or document governing any Enhancement or pursuant to which any Enhancement is issued or outstanding.
"ENHANCEMENT PROVIDER" means the Person or Persons providing any Enhancement, other than the Noteholders of any Class which is subordinated to another Class.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"EUROCLEAR OPERATOR" means Euroclear Bank S.A./N.V.
"EVENT OF DEFAULT" is defined in SECTION 5.2 of the Indenture.
"EXCESS ALLOCATION SERIES" means a Series that, pursuant to the Indenture Supplement therefor, is entitled to receive certain excess Collections of Finance Charge Receivables, as more specifically set forth in such Indenture Supplement. If so specified in the Indenture Supplement for a Group of Series, such Series may be Excess Allocation Series only for the Series in such Group.
"EXCESS FINANCE CHARGE COLLECTIONS" means all amounts that any Indenture Supplement designates as "Excess Finance Charge Collections."
"EXCESS FUNDING ACCOUNT" is defined in SECTION 8.3 of the Indenture.
"EXCHANGE ACT" means the Securities Exchange Act of 1934.
"EXISTING ASSETS" means (i) the Transferor Interest (as defined in the Pooling and Servicing Agreement), (ii) the Receivables existing at the opening of business on the Effective Date and arising from the Accounts, (iii) all Related Assets with respect to such Receivables, (iv) all right, title and interest of RPA Seller (in its capacity as Transferor (as defined in the Pooling and Servicing Agreement) but not as Servicer (as defined in the Pooling and Servicing Agreement)) under the Prior PSA and the other Transaction Documents (as defining in the Pooling and Servicing Agreement), including any loan agreements and Supplements executed in connection with any Series of Investor Certificates and (v) all right, title and interest of RPA Seller, in its capacity as Transferor under (and as defined in) the Pooling and Servicing Agreement to any funds on
deposit in any Series Account (as defined in the Pooling and Servicing Agreement) maintained for the benefit of any Series or Class of Investor Certificates.
"EXISTING PSA" is defined in the Pooling and Servicing Agreement.
"EXPENSES" is defined in SECTION 7.2 of the Trust Agreement.
"FDIA" means the Federal Deposit Insurance Act, 12 U.S.C.ss. 1811 et seq., as supplemented, amended or otherwise modified from time to time.
"FDIC" means the Federal Deposit Insurance Corporation.
"FINANCE CHARGE RECEIVABLES" means, with respect to any Monthly Period, the sum of (a) all amounts billed to the Obligors on any Account at the beginning of such Monthly Period in respect of Periodic Finance Charges, (b) Late Fees, return check fees and any other fees that may be charged with respect to any Account, to the extent that Servicer designates such fees to be treated as Finance Charge Receivables in an Officer's Certificate delivered to the Indenture Trustee and (c) Discount Option Receivables. Except as otherwise specified in any Indenture Supplement as to the related Series, Recoveries shall be treated as Collections of Finance Charge Receivables .
"FINANCE CHARGE SHORTFALLS" is defined, as to any Series, in the related Indenture Supplement.
"FITCH" means Fitch, Inc.
"FOREIGN CLEARING AGENCY" means Clearstream and the Euroclear Operator.
"GAAP" means generally accepted accounting principles in the United States of America in effect from time to time.
"GLOBAL NOTE" is defined in SECTION 2.16 of the Indenture.
"GOVERNMENTAL AUTHORITY" means 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.
"GRANT" means to mortgage, pledge, bargain, warrant, alienate, remise, release, convey, assign, transfer, create, and grant a lien upon and a security interest in and right of set-off against, deposit, set over and confirm pursuant to this Indenture. A Grant of the Collateral or of any other agreement or instrument shall include all rights, powers and options (but none of the obligations) of the Granting party thereunder, including if available the immediate and continuing right to claim for, collect, receive and give receipt for principal and interest payments in respect of the Collateral and all other moneys payable thereunder, to give and receive notices and other communications, to make waivers or other
agreements, to exercise all rights and options, to bring Proceedings in the name of the Granting party or otherwise and generally to do and receive anything that the Granting party is or may be entitled to do or receive thereunder or with respect thereto.
"GROUP" means, with respect to any Series, the group of Series, if any, in which the related Indenture Supplement specifies such Series is to be included.
"HOLDER" means a Noteholder or a Person in whose name the Transferor Interest is registered.
"HOLDING" means Alliance Data Systems Corporation, a Delaware corporation.
"IDENTIFIED PORTFOLIO" means any Accounts owned from time to time by WFN and included in the private label credit card programs of Lane Bryant, Inc., Lerner New York, Inc., Express, Inc., Structure, Inc., Victoria's Secret Stores, Inc., Victoria's Secret Catalogue, Inc., The Limited, Abercrombie & Fitch, Inc., Henri Bendel, Inc. and Brylane, L.P. (but limited, in the case of Brylane, L.P., to accounts related to the Lane Bryant, Lerner New York and Roamans catalogues). To avoid doubt, the foregoing programs include all cards issued under the insignia of "Limited Fashion Group."
"IN-STORE PAYMENTS" is defined in SECTION 2.1 of the Transfer and Servicing Agreement.
"INDEMNIFIED PARTIES" is defined in SECTION 7.2 of the Trust Agreement.
"INDENTURE" means the Master Indenture, dated as of August 1, 2001, between the Issuer and the Indenture Trustee, as the same may be amended, supplemented or otherwise modified from time to time.
"INDENTURE SUPPLEMENT" means, with respect to any Series, a supplement to this Indenture, executed and delivered in connection with the original issuance of the Notes of such Series pursuant to SECTION 2.12 of the Indenture, and an amendment to this Indenture executed pursuant to SECTIONS 10.1 or 10.2 of the Indenture, and, in either case, including all amendments thereof and supplements thereto.
"INDENTURE TRUSTEE" means BNY Midwest Trust Company, in its capacity as trustee under this Indenture, its successors in interest and any successor indenture trustee under this Indenture.
"INDEPENDENT" means, when used with respect to any specified Person, that the Person (a) is in fact independent of the Issuer, any other obligor upon the Notes, the Transferor and any Affiliate of any of the foregoing Persons, (b) does not have any direct financial interest or any material indirect financial interest in the Issuer, any such other obligor, the Transferor or any Affiliate of any of the foregoing Persons and (c) is not connected with the Issuer, any such other obligor,
the Transferor or any Affiliate of any of the foregoing Persons as an officer, employee, promoter, underwriter, trustee, partner, director or person performing similar functions.
"INDEPENDENT CERTIFICATE" means a certificate or opinion to be delivered to the Indenture Trustee under the circumstances described in, and otherwise complying with, the applicable requirements of SECTION 12.1 of the Indenture, made by an Independent appraiser or other expert appointed by an Issuer Order, and such opinion or certificate shall state that the signer has read the definition of "Independent" in this Indenture and that the signer is Independent within the meaning thereof.
"INDEPENDENT DIRECTOR" is defined in SECTION 2.5(O)(VII).
"INDIRECT PARTICIPANT" means other Persons such as securities brokers and dealers, banks and trust companies that clear or maintain a custodial relationship with a participant of DTC, either directly or indirectly.
"INELIGIBLE RECEIVABLES" is defined in SECTION 2.4(d) of the Transfer and Servicing Agreement.
"INITIAL CLOSING DATE" means August 21, 2001.
"INITIAL COLLATERAL AMOUNT" with respect to any Series, shall have the meaning specified in the related Indenture Supplement.
"INSOLVENCY EVENT" means, with respect to any Person, that such person shall consent 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 Person or relating to all or substantially all of such Person's property, or the commencement of an action seeking 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 entity's affairs, or notwithstanding an objection by such Person any such action shall have remained undischarged or unstayed for a period of sixty (60) days or upon entry of any order or decree providing for such relief; or such Person shall admit in writing its inability to pay its debts generally as they become due, file, or consent or fail to object (or object without dismissal of any such filing within sixty (60) days of such filing) to the filing of, 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.
"INSURANCE PROCEEDS" means any amounts recovered by Servicer pursuant to any credit insurance policies covering any Obligor with respect to Receivables under such Obligor's Account.
"INTEREST PAYMENT DATE" is defined in SECTION 3.1(C) of the Receivables Purchase Agreement.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940.
"INVESTOR CERTIFICATE" is defined in the Pooling and Servicing Agreement.
"INVESTOR HOLDER" is defined in the Pooling and Servicing Agreement.
"INVOLUNTARY REMOVAL" is defined in SECTION 2.7(A) of the Transfer and Servicing Agreement.
"ISSUER" means the World Financial Network Credit Card Master Note Trust, which is established by the Trust Agreement.
"ISSUER ORDER" and "ISSUER REQUEST" means a written order or request signed in the name of the Issuer by any one of its Authorized Officers and delivered to the Indenture Trustee.
"LATE FEES" means the fees specified in the Credit Card Agreement applicable to each Account for late fees with respect to such Account.
"LIEN" means any mortgage, deed of trust, pledge, hypothecation, assignment, participation or equity interest, deposit arrangement, encumbrance, lien (statutory or other), preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever, including any conditional sale or other title retention agreement, excluding any lien or filing pursuant to the Indenture; provided that any assignment or transfer pursuant to SECTION 3.4 of the Trust Agreement or SECTION 7.2 OF THE TRANSFER AND SERVICING AGREEMENT SHALL NOT CONSTITUTE A LIEN.
"MAJORITY HOLDERS" means the Holders of Notes evidencing more than 50% of the Outstanding Amount.
"MERCHANT" means each of (a) Bath & Body Works, Inc., Brylane, L.P., Cacique, Inc., Lane Bryant, Inc., Lerner New York, Inc., Express, Inc., Structure, Inc., Victoria's Secret Stores, Inc., Victoria's Secret Catalogue, Inc., The Limited Stores, Inc., Limited Too, Inc., Abercrombie & Fitch, Inc., and Henri Bendel, Inc. and (b) any other Person that operates retail establishments at which, or a catalogue sales business in which, goods or services may be purchased under an Account.
"MERCHANT ADJUSTMENT PAYMENT" is defined in SECTION 3.2 of the Receivables Purchase Agreement.
"MINIMUM TRANSFEROR AMOUNT" means, as of any date of determination, the sum of (a) the product of (i) the Aggregate Principal Receivables and (ii) the Required Retained Transferor Percentage plus (b) any additional amounts specified in the Indenture Supplement for any outstanding Series.
"MONTHLY PERIOD" means as to each Distribution Date, the immediately preceding calendar month, unless otherwise defined in any Indenture Supplement.
"MOODY'S" means Moody's Investors Service, Inc.
"NEW DISCOUNT OPTION RECEIVABLES" means, as of any date of determination, the product of the Discount Percentage and the amount of Principal Receivables (before subtracting Finance Charge Receivables which are Discount Option Receivables) arising on such date of determination.
"NEW ISSUANCE" is defined in SECTION 2.12(a) of the Indenture.
"NOTE" means one of the Notes issued by the Issuer pursuant to the Indenture and an Indenture Supplement, substantially in the form attached to the related Indenture Supplement.
"NOTE INTEREST RATE" means, as of any particular date of determination and with respect to any Series or Class, the interest rate as of such date specified therefor in the related Indenture Supplement.
"NOTE OWNER" means, with respect to a Book-Entry Note, the Person who is the owner of such Book-Entry Note, 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).
"NOTE PRINCIPAL BALANCE" means, as of any particular date of determination and with respect to any Series or Class, the amount specified in the related Indenture Supplement.
"NOTE REGISTER" is defined in SECTION 2.5 of the Indenture.
"NOTE TRUST" means World Financial Network Credit Card Master Note Trust.
"NOTEHOLDER" means the Person in whose name a Note is registered on the Note Register and, if applicable, the holder of any Global Note, or Coupon, as the case may be, or such other Person deemed to be a "Noteholder" or "Holder" in any related Indenture Supplement.
"NOTEHOLDER SERVICING FEE" is defined in SECTION 3.2 of the Transfer and Servicing Agreement.
"NOTES" means all Series of Notes issued by the Issuer pursuant to the Indenture and the applicable Indenture Supplements.
"NOTICE DATE" is defined in SECTION 2.6(d) of the Transfer and Servicing Agreement.
"NOTICES" is defined in SECTION 9.4(a) of the Transfer and Servicing Agreement.
"OBLIGOR" means, as to any Account, the Person or Persons obligated to make payments on such Account, including any guarantor.
"OFFICER'S CERTIFICATE" means a certificate delivered to the Indenture Trustee or Owner Trustee signed by the Chairman of the Board, President, any Vice President or the Treasurer or any Assistant Treasurer of Transferor or Servicer, as the case may be.
"OPINION OF COUNSEL" means a written opinion of counsel, who may be counsel for, or an employee of, the Person providing the opinion.
"ORIGINAL TRUST AGREEMENT" is defined in the RECITALS TO THE TRUST
AGREEMENT.
"OTHER ASSETS" is defined in SECTION 12.17 of the Indenture.
"OTHER ORIGINATOR" means any Person from which the Credit Card Originator acquires a portfolio of credit card accounts any or all of which are subsequently designated as Additional Accounts.
"OUTSTANDING" means, as of the date of determination, all Notes theretofore authenticated and delivered under this Indenture except:
(i) Notes theretofore canceled by the Note Registrar or delivered to the Note Registrar for cancellation;
(ii) Notes or portions thereof the payment for which money in the necessary amount has been theretofore deposited with the Indenture Trustee or any Paying Agent in trust for the Holders of such Notes (PROVIDED, HOWEVER, that if such Notes are to be redeemed, notice of such redemption has been duly given pursuant to the Indenture or provision therefor, satisfactory to the Indenture Trustee, has been made); and
(iii) Notes in exchange for or in lieu of other Notes which have been authenticated and delivered pursuant to the Indenture unless proof satisfactory to the Indenture Trustee is presented that any such Notes are held by a protected purchaser;
PROVIDED that in determining whether the Holders of Notes representing the requisite Outstanding Notes have given any request, demand, authorization, direction, notice, consent or waiver hereunder, Notes owned by the Issuer, any other obligor upon the Notes, the Transferor, the Servicer or any Affiliate of any of the foregoing Persons shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Indenture Trustee shall be protected in
relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Notes that a Responsible Officer of the Indenture Trustee actually knows to be so owned shall be so disregarded. Notes so owned that have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Indenture Trustee the pledgee's right so to act with respect to such Notes and that the pledgee is not the Issuer, any other obligor upon the Notes, the Transferor, the Servicer or any Affiliate of any of the foregoing Persons. In making any such determination, the Indenture Trustee may conclusively rely on the representations of the pledgee and shall not be required to undertake any independent investigation.
"OUTSTANDING AMOUNT" means the aggregate principal amount of all Notes Outstanding at the date of determination.
"OWNER TRUSTEE" means Chase Manhattan Bank USA, National Association, not in its individual capacity but solely in its capacity as owner trustee under the Trust Agreement, its successors in interest and any successor owner trustee under the Trust Agreement.
"PARTICIPATION INTERESTS" is defined in SECTION 2.6(b) of the Transfer and Servicing Agreement.
"PAYING AGENT" means any paying agent appointed pursuant to SECTION 2.8 of the Indenture and shall initially be the Indenture Trustee; PROVIDED that if the Indenture Supplement for a Series so provides, a separate or additional Paying Agent may be appointed with respect to such Series.
"PERFECTION REPRESENTATIONS AND WARRANTIES" means the representations and warranties set forth below:
GENERAL. The Specified Agreement creates a valid and continuing security interest (as defined in the applicable UCC) in the Receivables and the proceeds thereof in favor of the Secured Party, which, (a) in the case of existing Receivables and the proceeds thereof, is enforceable upon execution of the Specified Agreement against creditors of and purchasers from Debtor, or with respect to then existing Receivables in Additional Accounts, as of the applicable Addition Date, and which will be enforceable with respect to Receivables hereafter and thereafter created and the proceeds thereof upon such creation, in each case as such enforceability may be limited by applicable Debtor Relief Laws, now or hereafter in effect, and by general principles of equity (whether considered in a suit at law or in equity) and (b) upon filing of the financing statements described in CLAUSE 4 below and, in the case of Receivables hereafter created, upon the creation thereof, will be prior to all other Liens (other than Liens permitted pursuant to CLAUSE 3 below).
GENERAL. The Receivables constitute "accounts" within the meaning of UCC Section 9-102.
CREATION. Immediately prior to the conveyance of the Receivables pursuant to the Specified Agreement, Debtor owns and has good and marketable title to, or has a valid security interest in, the Receivables free and clear of any Lien, claim or encumbrance of any Person; provided that nothing in this CLAUSE 3 shall prevent or be deemed to prohibit Debtor from suffering to exist upon any of the Receivables any Liens for any taxes if such taxes shall not at the time be due and payable or if Transferor or RPA Seller, as applicable, shall currently be contesting the validity thereof in good faith by appropriate proceedings and shall have set aside on its books adequate reserves with respect thereto.
PERFECTION. Debtor has caused or will have caused, within ten days of the Initial Closing Date, 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 granted to the Secured Party under the Specified Agreement in the Receivables arising in the Initial Accounts and Automatic Additional Accounts included in the Identified Portfolio, and (if any additional filing is so necessary) within 10 days of the applicable Addition Date, in the case of such Receivables arising in Supplemental Accounts and related Automatic Additional Accounts.
PRIORITY. Other than the security interest granted to the Secured Party pursuant to the Specified Agreement, Debtor has not pledged, assigned, sold, granted a security interest in, or otherwise conveyed any of the Receivables. Debtor has not authorized the filing of and is not aware of any financing statements against Debtor that include a description of collateral covering the Receivables other than any financing statement (i) relating to the security interest granted to Secured Party under the Specified Agreement, (ii) that has been terminated, or (iii) that has been granted pursuant to the terms of the Transaction Documents.
"PERIODIC FINANCE CHARGES" means any finance charges (due to periodic rate) applicable to any Account.
"PERMITTED ASSIGNEE" means any Person who, if it were to purchase Receivables (or interests therein) in connection with a sale thereof pursuant to SECTIONS 5.5(a) and 5.16 of the Indenture, would not cause the Issuer to be taxable as a publicly traded partnership for federal income tax purposes.
"PERSON" means any legal person, including any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization, governmental entity or other entity of similar nature.
"POOLING AND SERVICING AGREEMENT" means the Second Amended and Restated Pooling and Servicing Agreement, dated as of January 17, 1996, amended and restated as of September 17, 1999 and amended and restated a second time as of August 1, 2001, among WFN Credit Company, LLC, as Transferor, WFN, as Servicer, and BNY Midwest Trust Company, successor to
the corporate trust administration of Harris Trust and Savings Bank, successor to The Bank of New York.
"PORTFOLIO REASSIGNMENT PRICE" means the amount payable by Purchaser to the Receivables Trust Trustee pursuant to SECTION 2.6 of the Pooling and Servicing Agreement or SECTION 2.4(f) of the Transfer and Servicing Agreement with respect to Receivables previously sold pursuant to the Receivables Purchase Agreement.
"PORTFOLIO YIELD" is defined, as to any Series, in the related Indenture Supplement.
"PRINCIPAL RECEIVABLE" means all Receivables other than Finance Charge Receivables. In calculating the aggregate amount of Principal Receivables on any day, the amount of Principal Receivables shall not include Defaulted Receivables and shall be reduced by the aggregate amount of credit balances in the Accounts on such day.
"PRINCIPAL SHARING SERIES" means a Series that, pursuant to the Indenture Supplement therefor, is entitled to receive Shared Principal Collections.
"PRINCIPAL SHORTFALLS" is defined, as to any Series, in the related Indenture Supplement.
"PRINCIPAL TERMS" means, with respect to any Series, (a) the name or
designation; (b) the initial principal amount (or method for calculating such
amount) and the Collateral Amount; (c) the Note Interest Rate for each Class of
Notes of such Series (or method for the determination thereof); (d) the payment
date or dates and the date or dates from which interest shall accrue; (e) the
method for allocating Collections to Holders of such Series; (f) the designation
of any Series Accounts and the terms governing the operation of any such Series
Accounts; (g) the Series Servicing Fee Percentage; (h) the terms of any form of
Enhancement with respect thereto; (i) the terms on which the Notes of such
Series may be exchanged for Notes of another Series, repurchased by the
Transferor or remarketed to other investors; (j) the Series Termination Date;
(k) the number of Classes of Notes of such Series and, if more than one Class,
the rights and priorities of each such Class; (l) the extent to which the Notes
of such Series will be issuable in temporary or permanent global form (and, in
such case, the depositary for such global note or notes, the terms and
conditions, if any, upon which such global note or notes may be exchanged, in
whole or in part, for Definitive Notes, and the manner in which any interest
payable on a temporary or global note will be paid); (m) whether the Notes of
such Series may be issued in bearer form and any limitations imposed thereon;
(n) the priority of such Series with respect to any other Series; (o) whether
such Series will be part of a Group; (p) whether such Series will be a Principal
Sharing Series; (q) whether such Series will be an Excess Allocation Series; (r)
the Distribution Date; (s) the legal final maturity date on which the rights of
the Noteholders of such Series to receive payments from the Issuer will
terminate, which shall not be later than the Scheduled Trust Termination Date;
and (t) whether such Series will or may act as
a paired series with another existing Series and the Series, with which it will be paired, if applicable.
"PROCEEDING" means any suit in equity, action at law or other judicial or administrative proceeding.
"PURCHASE PRICE" is defined in SECTION 3.1(a) of the Receivables Purchase Agreement.
"PURCHASER" means WFN Credit Company, LLC, as purchaser, under the Receivables Purchase Agreement.
"PURCHASER TANGIBLE EQUITY" means, at any date of determination, an amount equal to:
(a) the Transferor Amount, PLUS
(b) the aggregate amount on deposit in all cash collateral accounts or spread accounts established for the benefit of any Series or Class of Notes or any series or class of Investor Certificates; MINUS
(c) the outstanding balance of the Subordinated Note; PLUS
(d) the "Purchaser Tangible Equity" or other similar amounts for any other transactions to which the Purchaser is a party.
"RATING AGENCY" means, as to each Series, the rating agency or agencies, if any, specified in the related Indenture Supplement.
"RATING AGENCY CONDITION" means, with respect to any action, that each Rating Agency, if any, shall have notified Transferor, Servicer and the Indenture Trustee in writing that such action will not result in a reduction or withdrawal of the rating, if any, of any outstanding Series or Class with respect to which it is a Rating Agency.
"REASSIGNMENT" is defined in SECTION 2.7(A) of the Transfer and Servicing Agreement.
"RECEIVABLE" means any amount owing from time to time by an Obligor under an Account, including amounts owing for purchases of goods and services and cash advances, and amounts payable as Finance Charge Receivables. A Receivable shall be deemed to have been created at the end of the day on the Date of Processing of such Receivable. Receivables which become Defaulted Receivables shall not be shown on Servicer's records as amounts payable (and shall cease to be included as Receivables) on the day on which they become Defaulted Receivables.
"RECEIVABLES PURCHASE AGREEMENT" means the Receivables Purchase Agreement dated as of August 1, 2001, between WFN, as Seller, and WFN Credit Company, LLC, as purchaser.
"RECEIVABLES TRUST" means (a) prior to the Certificate Trust Termination Date, the Certificate Trust and (b) on and after the Certificate Trust Termination Date, the Issuer.
"RECEIVABLES TRUST TRUSTEE" means (a) prior to the Certificate Trust Termination Date, the Certificate Trust Trustee and (b) after the Certificate Trust Termination Date, the Indenture Trustee.
"RECORD DATE" means, with respect to any Distribution Date, the last Business Day of the calendar month immediately preceding such Distribution Date unless otherwise specified for a Series in the related Indenture Supplement.
"RECOVERIES" means (a) all amounts received by Servicer with respect to Principal Receivables that have previously become Defaulted Receivables and with respect to Finance Charge Receivables that have been charged off as uncollectible (including Insurance Proceeds) and (b) proceeds of any collateral securing any Receivable, in each case less related collection expenses.
"REDEMPTION DATE" means, with respect to any Series, the date or dates specified in the related Indenture Supplement.
"REGISTERED NOTES" is defined in SECTION 2.1 of the Indenture.
"RELATED ASSETS" means, with respect to any Receivable, all monies due or to become due with respect thereto, all Collections, all Recoveries, all Insurance Proceeds, all rights, remedies, powers and privileges with respect to such Receivables, and all proceeds of the foregoing, and without limiting the generality of the foregoing, all of the RPA Seller's rights to receive In-Store Payments, and all proceeds of such rights.
"REMOVAL DATE" is defined in SECTION 2.7(a) of the Transfer and Servicing Agreement.
"REMOVAL NOTICE DATE" is defined in SECTION 2.7(a) of the Transfer and Servicing Agreement.
"REMOVED ACCOUNTS" is defined in SECTION 2.7(a) of the Transfer and Servicing Agreement.
"REQUIRED PRINCIPAL BALANCE" means, as of any date of determination, the sum of the numerators used at such date to calculate the Allocation Percentages with respect to Principal Receivables for all Series outstanding on such date, less the amount on deposit in the Excess Funding Account as of the date of determination.
"REQUIRED PURCHASER TANGIBLE EQUITY" means, at any date of determination, the sum of:
(a) the product of (i) the Transferor Amount, multiplied by (ii) the higher of (A) 3% and (B) the highest required enhancement percentage then in effect for
any outstanding Class of Notes or Investor Certificates that was rated BBB (or an equivalent rating) by any of Moody's, S&P or Fitch at the time of its issuance, which shall be calculated as the quotient (expressed as a percentage) of (x) the amount of Enhancement (including any cash collateral account, the subordination of other Classes of Notes or the subordination of other interests in the Receivables) that is available or junior to such Class in covering Defaulted Receivables allocated to the related Series, divided by (y) the Initial Collateral Amount for the Series of Notes or Investor Certificates of which such Class is a part; PLUS
(b) the aggregate amount on deposit in all cash collateral accounts or spread accounts established for the benefit of any Series or Class of Notes or any series or class of Investor Certificates aggregate amount of Principal Receivables on such date, PLUS
(c) the "Required Purchaser Tangible Equity" or other similar amounts for any other transactions to which the Purchaser is a party.
"REQUIRED RETAINED TRANSFEROR PERCENTAGE" means, as of any date of determination, 4% or, if less, the highest of the Required Retained Transferor Percentages specified in the Indenture Supplements for all outstanding Series.
"REQUIREMENTS OF LAW" means, as to any Person, the certificate of incorporation or articles of association and by-laws or other organizational or governing documents of such Person, and any law, treaty, rule or regulation, or determination of an arbitrator or Governmental Authority, in each case applicable to or binding upon such Person or to which such Person is subject, whether Federal, state or local.
"RESPONSIBLE OFFICER" means, with respect to the Issuer, the Chairman or any Vice Chairman of the Board of Directors or Trustees of the Administrator; the Chairman or Vice Chairman of the Executive or Standing Committee of the Board of Directors or Trustees of the Administrator; and the President, any Executive Vice President, Senior Vice President, Vice President, any Assistant Vice President, the Secretary, any Assistant Secretary, the Treasurer, any Assistant Treasurer, the Cashier, any Assistant or Deputy Cashier, the Controller and any Assistant Controller or any other officer of the Administrator customarily performing functions similar to those performed by any of the above-designated officers. With respect to the Indenture Trustee, the term "Responsible Officer" means any officer assigned to the Corporate Trust Office, including any vice president, assistant vice president, assistant treasurer, or any other officer of the Indenture Trustee customarily performing functions similar to those performed by any of the above designated officers and having direct responsibility for the administration of the applicable Transaction Documents, and also, with respect to a particular matter, any other officer, to whom such matter is referred because of such officer's knowledge of and familiarity with the particular subject. With respect to the Owner Trustee, the term "Responsible Officer" means any officer within the Corporate Trust Office of the Owner Trustee with direct responsibility for the administration of the Trust, or any other officer to whom such matter is
referred because of such officer's knowledge of and familiarity with the particular subject. The term "Responsible Officer", when used herein with respect to any Person other than the Issuer, the Indenture Trustee or the Owner Trustee, means an officer or employee of such Person corresponding to any officer or employee described in the preceding sentence.
"RESTART DATE" is defined in SECTION 2.6(a) of the Transfer and Servicing Agreement.
"RPA SELLER" means World Financial Network National Bank, as Seller, under the Receivables Purchase Agreement.
"RULE 144A" means Rule 144A under the Securities Act, as such Rule may be amended from time to time.
"S&P" or "STANDARD & POOR'S" means Standard & Poor's Ratings Service, a division of the McGraw Hill Companies, Inc.
"SECURED PARTY" means the party designated in the Specified Agreement as the "Secured Party" for purposes of the Perfection Representations and Warranties.
"SECURITIES ACT" means the Securities Act of 1933.
"SERIES" means any series of Notes, which may include within any such Series a Class or Classes of Notes subordinate to another such Class or Classes of Notes.
"SERIES ACCOUNT" means any deposit, trust, escrow or similar account maintained for the benefit of the Noteholders of any Series or Class, as specified in any Indenture Supplement.
"SERIES SERVICING FEE PERCENTAGE" is defined, as to any Series, in the related Indenture Supplement.
"SERIES TERMINATION DATE" means, with respect to any Series, the termination date for such Series specified in the related Indenture Supplement.
"SERVICE TRANSFER" is defined in SECTION 7.1 of the Transfer and Servicing Agreement.
"SERVICER" means WFN, in its capacity as Servicer pursuant to the Transfer and Servicing Agreement, and, after any Service Transfer, the Successor Servicer.
"SERVICER DEFAULT" is defined in SECTION 7.1 of the Transfer and Servicing Agreement.
"SERVICING FEE" means, as to any Series, the servicing fee specified in
SECTION 3.2 of the Transfer and Servicing Agreement.
"SERVICING OFFICER" means any officer of Servicer involved in, or responsible for, the administration and servicing of the Receivables whose name appears on a list of servicing officers furnished to Indenture Trustee by Servicer, as such list may from time to time be amended.
"SETTLEMENT STATEMENT" is defined in SECTION 3.3 of the Receivables Purchase Agreement.
"SHARED PRINCIPAL COLLECTIONS" means all amounts that any Indenture Supplement designates as "Shared Principal Collections."
"SPECIFIED AGREEMENT" means the agreement specified in a Transaction Document as the "Specified Agreement" for purposes of the Perfection Representations and Warranties.
"SPECIFIED TRANSFEROR AMOUNT" means, as of any date of determination, 0 or, if more, the highest amount identified as the "Specified Transferor Amount" in the Indenture Supplement for any outstanding Series.
"SUBORDINATED NOTE" shall mean a note substantially in the form of EXHIBIT B to the Receivables Purchase Agreement evidencing borrowings made by Purchaser from RPA Seller pursuant to the Receivables Purchase Agreement.
"SUBORDINATED NOTE MATURITY DATE" is defined in SECTION 3.1(c) of the Receivables Purchase Agreement.
"SUBORDINATED NOTE RATE" is defined in SECTION 3.1(c) of the Receivables Purchase Agreement.
"SUCCESSOR SERVICER" is defined in SECTION 7.2(a) of the Transfer and Servicing Agreement.
"SUPPLEMENTAL ACCOUNT" is defined in SECTION 2.6(b) of the Transfer and Servicing Agreement.
"SUPPLEMENTAL CONVEYANCE" is defined in SECTION 2.2(e) of the Receivables Purchase Agreement.
"SUPPLEMENTAL INTEREST" is defined in SECTION 3.4 of the Trust Agreement.
"SURVIVING PERSON" is defined in SECTION 3.10(a) of the Indenture.
"TAX OPINION" means, 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 Notes of any outstanding Series or Class with respect to which an Opinion of Counsel was delivered at the time of their issuance that such Notes would be characterized as debt, (b) such actions will not cause the Trust to be classified, for federal income tax purposes, as an association (or publicly traded partnership) taxable as a corporation and
(c) such action will not cause or constitute an event in which gain or loss would be recognized by any Noteholder.
"TERMINATION NOTICE" is defined in SECTION 7.1 of the Transfer and Servicing Agreement.
"THE LIMITED" means The Limited, Inc., a Delaware corporation.
"TRANSACTION DOCUMENTS" means the Master Indenture, Indenture Supplements, Transfer and Servicing Agreement, Receivables Purchase Agreement, Trust Agreement, Administration Agreement, and, until the Certificate Trust Termination Date, the Pooling and Servicing Agreement and the Collateral Series Supplement, and any other documents related to this transaction.
"TRANSFER AGENT AND REGISTRAR" is defined in SECTION 2.5 of the Indenture.
"TRANSFER AGREEMENT" means (a) prior to the Certificate Trust Termination Date, the Pooling and Servicing Agreement and (b) after the Certificate Trust Termination Date, the Transfer and Servicing Agreement.
"TRANSFER AND SERVICING AGREEMENT" means the Transfer and Servicing Agreement, dated as of August 1, 2001, between the Transferor, the Servicer and the Issuer as the same may be amended, supplemented or otherwise modified from time to time.
"TRANSFER DATE" means the Business Day immediately preceding each Distribution Date.
"TRANSFEROR" means WFN Credit Company, LLC, a Delaware limited liability
company, and additional transferors, if any, designated in accordance with
SECTION 2.11 of the Transfer and Servicing Agreement.
"TRANSFEROR AMOUNT" means, on any date of determination, the result of (a) the aggregate amount of Principal Receivables on such day, plus the principal amount on deposit in the Excess Funding Account on such day, minus (b) the sum of the Collateral Amounts with respect to all Series then outstanding plus (c) the principal amount on deposit in the Principal Accounts (as defined in the various Indenture Supplements) for each Series, to the extent not deducted in calculating the Collateral Amount for the related Series.
"TRANSFEROR INTEREST" means the interest of the Transferor or its assigns in the Issuer and the Receivables, which entitles the Transferor or its assigns to receive the various amounts specified in the Transaction Documents to be paid or transferred to the Holder(s) of the Transferor Interest.
"TRANSFEROR PERCENTAGE" means as to Finance Charge Receivables, Defaulted Receivables and Principal Receivables, 100% less the sum of the applicable Allocation Percentages for all outstanding Series.
"TRANSFEROR RETAINED NOTE" means any Note in any Class of Notes that is designated as a "Transferor Retained Class" in any Indenture Supplement.
"TRANSFERRED ACCOUNT" is defined in the definition of "Account."
"TRUST" means the World Financial Network Credit Card Master Note Trust.
"TRUST AGREEMENT" means the Amended and Restated Trust Agreement relating to the Trust, dated as of August 1, 2001, between the Transferor and the Owner Trustee, as the same may be amended, supplemented or otherwise modified from time to time.
"TRUST ASSETS" is defined in SECTION 2.1 of the Transfer and Servicing Agreement.
"TRUST EARLY AMORTIZATION EVENT" is defined, with respect to each Series, in SECTION 5.1 of the Indenture.
"TRUST ESTATE" means all right, title and interest of the Issuer in and to the property and rights assigned to the Issuer pursuant to SECTION 2.5 of the Trust Agreement and SECTION 2.1 of the Transfer and Servicing Agreement, all monies, investment property, instruments and other property on deposit from time to time in the Collection Account, the Series Accounts and the Excess Funding Account and all other property of the Issuer from time to time, including any rights of the Owner Trustee and the Issuer pursuant to the Transaction Documents.
"TRUST INDENTURE ACT" or "TIA" means the Trust Indenture Act of 1939.
"TRUST TERMINATION DATE" is defined in SECTION 8.1 of the Trust Agreement.
"UCC" means the Uniform Commercial Code, as in effect in the State of Ohio and in any other State where the filing of a financing statement is required to perfect Transferor's or the Trust's interest in the Receivables and the proceeds thereof or in any other specified jurisdiction.
"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.
"VARIABLE INTEREST" means any Note that is designated as a variable funding note in the related Indenture Supplement.
"WELSH, CARSON, ANDERSON & STOWE PARTNERSHIPS" means each Welsh, Carson, Anderson & Stowe limited partnership, as now constituted or as the same may be constituted in the future and any partner, partnership or affiliate of any of them.
"WFN" means World Financial Network National Bank, a national banking association.
Schedule 1
PERFECTION REPRESENTATIONS, WARRANTIES
AND COVENANTS
(a) In addition to the representations, warranties and covenants contained in the Indenture, the Issuer hereby represents, warrants and covenants to the Indenture Trustee as follows as of the Initial Closing Date:
(1) The Indenture creates a valid and continuing security interest (as defined in the applicable Uniform Commercial Code) in the Collateral Certificate in favor of the Indenture Trustee, which security interest is prior to all other Liens, and is enforceable as such against creditors of and purchasers from Issuer.
(2) The Collateral Certificate constitutes an "instrument," a "general intangible" or a "certificated security" within the meaning of the applicable Uniform Commercial Code.
(3) Issuer owns and has good and marketable title to the Collateral Certificate free and clear of any Lien, claim or encumbrance of any Person; PROVIDED that nothing in this PARAGRAPH (a)(3) shall prevent or be deemed to prohibit Issuer from suffering to exist upon any of the Receivables any Liens for any taxes if such taxes shall not at the time be due and payable or if WFN, Transferor, Seller or Issuer, as applicable, shall currently be contesting the validity thereof in good faith by appropriate proceedings and shall have set aside on its books adequate reserves with respect thereto.
(4) There are no consents or approvals required by the terms of the Collateral Certificate for the pledge of the Collateral Certificate to the Indenture Trustee pursuant to the Indenture.
(5) Issuer (or the Administrator on behalf of the Issuer) has caused 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 granted to the Indenture Trustee under the Indenture in the Collateral Certificate.
(6) There is only one executed copy of the Collateral Certificate and such copy has been delivered to the Indenture Trustee. The Collateral Certificate is registered in the name of the Indenture Trustee, upon original issue or registration of transfer by the Issuer. The Collateral Certificate does not have any marks or notations upon it indicating that it has been pledged, assigned or otherwise conveyed to any Person other than the Indenture Trustee.
(7) Other than the pledge of the Collateral Certificate to Indenture Trustee pursuant to the Indenture, Issuer has not pledged, assigned, sold, granted a security interest in, or otherwise conveyed the Collateral Certificate. Issuer has not authorized the filing of and is not aware of any financing statements against Issuer that include a description of collateral covering the Collateral Certificate, except for the financing
Sch-1
statement filed pursuant to the Indenture. Issuer is not aware of any judgment or tax lien filings against Issuer.
(8) The Collateral Certificate does not have any marks or notations indicating that it has been pledged, assigned or otherwise conveyed to any Person other than the Indenture Trustee.
(9) Notwithstanding any other provision of the Indenture, the representations and warranties set forth in this SCHEDULE 1 shall be continuing, and remain in full force and effect, until such time as the Collateral Certificate is retired.
(b) Indenture Trustee covenants that it shall not, without satisfying the Rating Agency Condition, waive a breach of any representation or warranty set forth in this SCHEDULE 1.
(c) Servicer covenants that in order to evidence the interests of Issuer and Indenture Trustee under the Indenture, Servicer shall take such action, or execute and deliver such instruments as may be necessary or advisable (including, without limitation, such actions as are requested by Indenture Trustee) to maintain and perfect, as a first priority interest, Indenture Trustee's security interest in the Collateral Certificate.
Sch-2
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS ...................................................................... 2
Section 1.1 Definitions ................................................................ 2
Section 1.2 Other Definitional Provisions .............................................. 2
ARTICLE II THE NOTES ........................................................................ 4
Section 2.1 Form Generally ............................................................. 4
Section 2.2 Denominations .............................................................. 4
Section 2.3 Execution, Authentication and Delivery ..................................... 4
Section 2.4 Authenticating Agent ....................................................... 5
Section 2.5 Registration of and Limitations on Transfer and Exchange of
Notes ...................................................................... 6
Section 2.6 Mutilated, Destroyed, Lost or Stolen Notes ................................. 8
Section 2.7 Persons Deemed Owners ...................................................... 9
Section 2.8 Appointment of Paying Agent ................................................ 9
Section 2.9 Access to List of Noteholders' Names and Addresses ......................... 10
Section 2.10 Cancellation ............................................................... 10
Section 2.11 New Issuances .............................................................. 11
Section 2.12 Book-Entry Notes ........................................................... 12
Section 2.13 Notices to Clearing Agency or Foreign Clearing Agency ...................... 13
Section 2.14 Definitive Notes ........................................................... 13
Section 2.15 Global Note ................................................................ 14
Section 2.16 Meetings of Noteholders .................................................... 14
Section 2.17 Uncertificated Classes ..................................................... 15
ARTICLE III REPRESENTATIONS AND COVENANTS OF ISSUER .......................................... 15
Section 3.1 Payment of Principal and Interest .......................................... 15
Section 3.2 Maintenance of Office or Agency ............................................ 15
Section 3.3 Money for Note Payments to Be Held in Trust ................................ 15
Section 3.4 Existence .................................................................. 17
Section 3.5 Protection of Collateral ................................................... 17
Section 3.6 Opinions as to Collateral .................................................. 17
Section 3.7 Performance of Obligations; Servicing of Receivables ....................... 18
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TABLE OF CONTENTS
(continued)
PAGE
Section 3.8 Negative Covenants ......................................................... 20
Section 3.9 Statements as to Compliance ................................................ 20
Section 3.10 Issuer May Consolidate, Etc., Only on Certain Terms ........................ 21
Section 3.11 Successor Substituted ...................................................... 23
Section 3.12 No Other Business .......................................................... 23
Section 3.13 Investments ................................................................ 23
Section 3.14 Capital Expenditures ....................................................... 23
Section 3.15 Removal of Administrator ................................................... 23
Section 3.16 Restricted Payments ........................................................ 23
Section 3.17 Notice of Events of Default ................................................ 24
Section 3.18 Derivative Financial Investments ........................................... 24
Section 3.19 Further Instruments and Acts ............................................... 24
Section 3.20 Perfection Representations and Warranties .................................. 24
ARTICLE IV SATISFACTION AND DISCHARGE ....................................................... 24
Section 4.1 Satisfaction and Discharge of this Indenture ............................... 24
Section 4.2 Application of Issuer Money ................................................ 26
ARTICLE V EARLY AMORTIZATION EVENTS, DEFAULTS AND
REMEDIES ......................................................................... 26
Section 5.1 Early Amortization Events .................................................. 26
Section 5.2 Events of Default .......................................................... 26
Section 5.3 Acceleration of Maturity; Rescission and Annulment ......................... 28
Section 5.4 Collection of Indebtedness and Suits for Enforcement by
Indenture Trustee .......................................................... 29
Section 5.5 Remedies; Priorities ....................................................... 31
Section 5.6 Optional Preservation of the Collateral .................................... 33
Section 5.7 Limitation on Suits ........................................................ 33
Section 5.8 Unconditional Rights of Noteholders to Receive Principal and Interest ...... 34
Section 5.9 Restoration of Rights and Remedies ......................................... 34
Section 5.10 Rights and Remedies Cumulative ............................................. 34
Section 5.11 Delay or Omission Not Waiver ............................................... 34
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TABLE OF CONTENTS
(continued)
PAGE
Section 5.12 Rights of Noteholders to Direct Indenture Trustee .......................... 35
Section 5.13 Waiver of Past Defaults .................................................... 35
Section 5.14 Undertaking for Costs ...................................................... 36
Section 5.15 Waiver of Stay or Extension Laws ........................................... 36
Section 5.16 Sale of Receivables ........................................................ 36
Section 5.17 Action on Notes ............................................................ 37
ARTICLE VI INDENTURE TRUSTEE ................................................................ 37
Section 6.1 Duties of Indenture Trustee ................................................ 37
Section 6.2 Notice of Early Amortization Event or Event of Default ..................... 39
Section 6.3 Rights of Indenture Trustee. Except as otherwise provided in
Section 6.1 ................................................................ 39
Section 6.4 Not Responsible for Recitals or Issuance of Notes .......................... 40
Section 6.5 Restrictions on Holding Notes .............................................. 41
Section 6.6 Money Held in Trust ........................................................ 41
Section 6.7 Compensation, Reimbursement and Indemnification ............................ 41
Section 6.8 Replacement of Indenture Trustee ........................................... 42
Section 6.9 Successor Indenture Trustee by Merger ...................................... 43
Section 6.10 Appointment of Co-Indenture Trustee or Separate
Indenture Trustee .......................................................... 43
Section 6.11 Eligibility; Disqualification .............................................. 45
Section 6.12 Preferential Collection of Claims Against .................................. 45
Section 6.13 Representations and Covenants of Indenture Trustee ......................... 45
Section 6.14 Custody of the Collateral .................................................. 45
ARTICLE VII NOTEHOLDERS' LIST AND REPORTS BY INDENTURE
TRUSTEE AND ISSUER ............................................................... 46
Section 7.1 Issuer to Furnish Indenture Trustee Names and Addresses of
Noteholders ................................................................ 46
Section 7.2 Preservation of Information; Communications to Noteholders ................. 46
Section 7.3 Reports by Issuer .......................................................... 47
Section 7.4 Reports by Indenture Trustee ............................................... 47
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TABLE OF CONTENTS
(continued)
PAGE
ARTICLE VIII ALLOCATION AND APPLICATION OF COLLECTIONS ........................................ 47
Section 8.1 Collection of Money ........................................................ 48
Section 8.2 Rights of Noteholders ...................................................... 48
Section 8.3 Establishment of Collection Account and Excess Funding
Account .................................................................... 48
Section 8.4 Collections and Allocations ................................................ 50
Section 8.5 Shared Principal Collections ............................................... 51
Section 8.6 Excess Finance Charge Collections .......................................... 52
Section 8.7 Release of Collateral; Eligible Loan Documents ............................. 52
Section 8.8 Opinion of Counsel ......................................................... 53
ARTICLE IX DISTRIBUTIONS AND REPORTS TO NOTEHOLDERS ......................................... 53
ARTICLE X SUPPLEMENTAL INDENTURES .......................................................... 53
Section 10.1 Supplemental Indentures Without Consent of Noteholders ..................... 53
Section 10.2 Supplemental Indentures with Consent of Noteholders ........................ 55
Section 10.3 Execution of Supplemental Indentures ....................................... 57
Section 10.4 Effect of Supplemental Indenture ........................................... 57
Section 10.5 Conformity With Trust Indenture Act ........................................ 57
Section 10.6 Reference in Notes to Supplemental Indentures .............................. 57
ARTICLE XI TERMINATION ...................................................................... 57
Section 11.1 Termination of Issuer ...................................................... 57
Section 11.2 Final Distribution ......................................................... 57
Section 11.3 Issuer's Termination Rights ................................................ 58
ARTICLE XII MISCELLANEOUS .................................................................... 59
Section 12.1 Compliance Certificates and Opinions etc ................................... 59
Section 12.2 Form of Documents Delivered to Indenture Trustee ........................... 61
Section 12.3 Acts of Noteholders ........................................................ 62
Section 12.4 Notices, Etc. to Indenture Trustee and Issuer .............................. 62
Section 12.5 Notices to Noteholders; Waiver ............................................. 63
Section 12.6 Alternate Payment and Notice Provisions .................................... 63
Section 12.7 Conflict with Trust Indenture Act .......................................... 63
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TABLE OF CONTENTS
(continued)
PAGE
Section 12.8 Effect of Headings and Table of Contents ................................... 64
Section 12.9 Successors and Assigns ..................................................... 64
Section 12.10 Separability ............................................................... 64
Section 12.11 Benefits of Indenture ...................................................... 64
Section 12.12 Legal Holidays ............................................................. 64
Section 12.13 GOVERNING LAW .............................................................. 64
Section 12.14 Counterparts ............................................................... 64
Section 12.15 Issuer Obligation .......................................................... 64
Section 12.16 No Petition ................................................................ 65
Section 12.17 Subordination .............................................................. 65
Annex A Definitions ................................................................ A-1
Schedule 1 Perfection Representations, Warranties and Covenants ......................Sch-1
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Exhibit 4.2
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
Issuer
And
BNY MIDWEST TRUST COMPANY
Indenture Trustee
SERIES 2001-A INDENTURE SUPPLEMENT
Dated as of August 21, 2001
Table of Contents
ARTICLE I. Creation of the Series 2001-A Notes ......................... 1
Section 1.1 Designation ........................................... 1
ARTICLE II. Definitions ................................................. 1
Section 2.1 Definitions ........................................... 1
ARTICLE III. Noteholder Servicing Fee ................................... 16
Section 3.1 Servicing Compensation ............................... 16
Section 3.2 Representations and Warranties ....................... 17
ARTICLE IV. Rights of Series 2001-A Noteholders and Allocation
and Application of Collections ............................. 17
Section 4.1 Collections and Allocations .......................... 17
Section 4.2 Determination of Monthly Interest .................... 20
Section 4.3 Determination of Monthly Principal ................... 21
Section 4.4 Application of Available Finance Charge
Collections and Available Principal
Collections .......................................... 21
Section 4.5 Investor Charge-Offs ................................. 24
Section 4.6 Reallocated Principal Collections .................... 25
Section 4.7 Excess Finance Charge Collections .................... 25
Section 4.8 Shared Principal Collections ......................... 25
Section 4.9 Certain Series Accounts .............................. 26
Section 4.10 Reserve Account ...................................... 27
Section 4.11 Cash Collateral Account .............................. 29
Section 4.12 Spread Account ....................................... 31
Section 4.13 Investment Instructions .............................. 33
Section 4.14 Controlled Accumulation Period ....................... 33
Section 4.15 Suspension of Controlled Accumulation Period ......... 34
Section 4.16 Determination of LIBOR ............................... 35
Section 4.17 Swaps ................................................ 36
ARTICLE V. Delivery of Series 2001-A Notes; Distributions;
Reports to Series 2001-A Noteholders ....................... 36
Section 5.1 Delivery and Payment for the Series 2001-A
Notes ................................................ 36
Section 5.2 Distributions ........................................ 37
Section 5.3 Reports and Statements to Series 2001-A
Noteholders .......................................... 37
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ARTICLE VI. Series 2001-A Early Amortization Events .................... 38
Section 6.1 Series 2001-A Early Amortization Events .............. 38
ARTICLE VII. Redemption of Series 2001-A Notes; Final
Distributions; Series Termination .......................... 40
Section 7.1 Optional Redemption of Series 2001-A Notes;
Final Distributions .................................. 40
Section 7.2 Series Termination ................................... 41
ARTICLE VIII. Miscellaneous Provisions ................................... 41
Section 8.1 Ratification of Indenture; Amendments ................ 41
Section 8.2 Form of Delivery of the Series 2001-A Notes .......... 41
Section 8.3 Counterparts ......................................... 42
Section 8.4 GOVERNING LAW ........................................ 42
Section 8.5 Limitation of Liability .............................. 42
Section 8.6 Rights of the Indenture Trustee ...................... 42
Section 8.7 Additional Provisions ................................ 42
Section 8.8 Additional Requirements for Registration of
and Limitations on Transfer and Exchange of
Notes ................................................ 42
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EXHIBITS
EXHIBIT A-1 FORM OF CLASS A NOTE
EXHIBIT A-2 FORM OF CLASS B NOTE
EXHIBIT A-3 FORM OF CLASS C NOTE
EXHIBIT B FORM OF MONTHLY PAYMENT INSTRUCTIONS AND
NOTIFICATION TO INDENTURE TRUSTEE
EXHIBIT C FORM OF MONTHLY NOTEHOLDERS' STATEMENT
EXHIBIT D FORM OF MONTHLY SERVICER'S CERTIFICATE
EXHIBIT E-1 FORM OF CLASS A SWAP
EXHIBIT E-2 FORM OF CLASS B SWAP
EXHIBIT E-3 FORM OF CLASS C SWAP
SCHEDULE I PERFECTION REPRESENTATIONS, WARRANTIES AND COVENANTS
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SERIES 2001-A INDENTURE SUPPLEMENT, dated as of August 21, 2001 (the
"INDENTURE SUPPLEMENT"), between WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE
TRUST, a business trust organized and existing under the laws of the State of
Delaware (herein, the "Issuer" or the "TRUST"), and BNY MIDWEST TRUST COMPANY, a
trust company organized and existing under the laws of the State of Illinois,
not in its individual capacity, but solely as indenture trustee (herein,
together with its successors in the trusts thereunder as provided in the Master
Indenture referred to below, the "INDENTURE TRUSTEE") under the Master
Indenture, dated as of August 1, 2001 (the "INDENTURE"), between the Issuer and
the Indenture Trustee (the Indenture, together with this Indenture Supplement,
the "AGREEMENT").
Pursuant to SECTION 2.11 of the Indenture, the Transferor may direct the Issuer to issue one or more Series of Notes. The Principal Terms of this Series are set forth in this Indenture Supplement to the Indenture.
ARTICLE I.
CREATION OF THE SERIES 2001-A NOTES
Section 1.1. DESIGNATION.
(a) There is hereby created and designated a Series of Notes to be issued pursuant to the Indenture and this Indenture Supplement to be known as "WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST, SERIES 2001-A" or the "SERIES 2001-A NOTES." The Series 2001-A Notes shall be issued in three Classes, known as the "CLASS A SERIES 2001-A FLOATING RATE ASSET BACKED NOTES," the "CLASS B SERIES 2001-A FLOATING RATE ASSET BACKED NOTES," and the "CLASS C SERIES 2001-A FLOATING RATE ASSET BACKED NOTES."
(b) Series 2001-A shall be included in Group One and shall be a Principal Sharing Series. Series 2001-A shall be an Excess Allocation Series with respect to Group One only. Series 2001-A shall not be subordinated to any other Series.
ARTICLE II.
DEFINITIONS
Section 2.1.DEFINITIONS.
(a) Whenever used in this Indenture Supplement, 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 the masculine as well as the feminine and neuter genders of such terms.
"ACCUMULATION SHORTFALL" means (a) for the first Distribution Date during the Controlled Accumulation Period, zero; and (b) thereafter, for any Distribution Date during the Controlled Accumulation Period, the excess, if any, of the Controlled Deposit Amount for the previous Distribution Date over the amount deposited into the Principal Accumulation Account pursuant to SUBSECTION 4.4(c)(i) for the previous Distribution Date.
"ADDITIONAL INTEREST" means, for any Distribution Date, Class A Additional Interest, Class B Additional Interest and Class C Additional Interest for such Distribution Date.
"ADDITIONAL MINIMUM TRANSFEROR AMOUNT" means (a) as of any date of determination falling in November, December and January of each calendar year, the product of (i) 2% and (ii) the sum of (A) the Aggregate Principal Receivables and (B) if such date of determination occurs prior to the Certificate Trust Termination Date, the amount on deposit in the Excess Funding Account and (b) as of any date of determination falling in any other month, zero; PROVIDED that the amount specified in CLAUSE (a) shall be without duplication with the amount specified as the "Additional Minimum Transferor Amount" in the Supplements relating to the Series 1996-VFC Certificates, Series 1996-A Certificates, Series 1996-B Certificates, Series 1999-A Certificates and Series 2001-VFC Certificates issued by the Certificate Trust (or in any future Indenture Supplement that specifies such an amount and indicates that such amount is without duplication of the amount specified in CLAUSE (a)). The Additional Minimum Transferor Amount is specified pursuant to SECTION 8.7 of this Indenture Supplement as an additional amount to be considered part of the Minimum Transferor Amount.
"AGGREGATE INVESTOR DEFAULT AMOUNT" means, as to any Monthly Period, the sum of the Investor Default Amounts in respect of such Monthly Period.
"ALLOCATION PERCENTAGE" means, with respect to any Monthly Period, the percentage equivalent of a fraction:
(a) the numerator of which shall be equal to:
(i) for Principal Collections during the Revolving Period and for Finance Charge Collections and Default Amounts at any time, the Collateral Amount at the end of the last day of the prior Monthly Period (or, in the case of the Monthly Period in which the Closing Date occurs, on the Closing Date), LESS any reductions to be made to the Collateral Amount on account of principal payments or deposits to the Principal Accumulation Account to be made on the Distribution Date falling in the Monthly Period for which the Allocation Percentage is being calculated; or
(ii) for Principal Collections during the Early Amortization Period and the Controlled Accumulation Period, the Collateral Amount at the end of the last day of the Revolving Period, PROVIDED, HOWEVER, that the Transferor may, by written notice to the Indenture Trustee, the Servicer and the Rating Agencies, reduce the numerator used for purposes of allocating Principal Collections to Series 2001-A at any time if (x) the Rating Agency Condition shall have been satisfied with respect to such reduction and (y) the Transferor shall have delivered to the Indenture Trustee an Officer's Certificate to the effect, based on the facts known to such officer at that time, in the reasonable belief of the Transferor, such designation will not cause an Early Amortization Event or an event that, after the giving of notice or the lapse of time, would cause an Early Amortization Event to occur with respect to Series 2001-A, and
(b) the denominator of which shall be the greater of (x) the Aggregate Principal Receivables determined as of the close of business on the last day of the prior Monthly Period and (y) the sum of the numerators used to calculate the allocation percentages for allocations with respect to Finance Charge Collections, Principal Collections or Default Amounts, as applicable, for all outstanding Series and all outstanding Series under (and as defined in) the Pooling and Servicing Agreement (other than any Series represented by the Collateral Certificate) on such date of determination PROVIDED, that if one or more Reset Dates occur in a Monthly Period, the Allocation Percentage for the portion of the Monthly Period falling on and after such Reset Date and prior to any subsequent Reset Date will be recalculated for such period as of the close of business on the subject Reset Date.
"AVAILABLE CASH COLLATERAL AMOUNT" means with respect to any Transfer
Date, an amount equal to the lesser of (a) the amount on deposit in the Cash
Collateral Account (before giving effect to any deposit to, or withdrawal from,
the Cash Collateral Account made or to be made with respect to such date) and
(b) the Required Cash Collateral Amount for such Transfer Date.
"AVAILABLE FINANCE CHARGE COLLECTIONS" means, for any Monthly Period, an amount equal to the sum of (a) the Investor Finance Charge Collections for such Monthly Period, PLUS (b) the Excess Finance Charge Collections allocated to Series 2001-A for such Monthly Period, PLUS (c) Principal Accumulation Investment Proceeds, if any, with respect to the related Transfer Date, PLUS (d) interest and earnings on funds on deposit in the Reserve Account and Cash Collateral Account which will be deposited into the Finance Charge Account on the related Transfer Date to be treated as Available Finance Charge Collections pursuant to SUBSECTIONS 4.10(b) and 4.11(b), respectively, PLUS (e) amounts, if any, to be withdrawn from the Reserve Account which will be deposited into the Finance Charge Account on the related Transfer Date to be treated as Available Finance Charge Collections pursuant to SUBSECTION 4.10(d), PLUS (f) any Net Swap Receipts for the related Distribution Date.
"AVAILABLE PRINCIPAL COLLECTIONS" means, for any Monthly Period, an amount equal to the sum of (a) the Investor Principal Collections for such Monthly Period, MINUS (b) the amount of Reallocated Principal Collections with respect to such Monthly Period which pursuant to SECTION 4.6 are required to be applied on the related Distribution Date, PLUS (c) any Shared Principal Collections with respect to other Principal Sharing Series (including any amounts on deposit in the Excess Funding Account that are allocated to Series 2001-A for application as Shared Principal Collections), PLUS (d) the aggregate amount to be treated as Available Principal Collections pursuant to SUBSECTIONS 4.4(a)(v) and (vi) for the related Distribution Date.
"AVAILABLE RESERVE ACCOUNT AMOUNT" means, for any Transfer Date, the lesser of (a) the amount on deposit in the Reserve Account (after taking into account any interest and earnings retained in the Reserve Account pursuant to SUBSECTION 4.10(b) on such date, but before giving effect to any deposit made or to be made pursuant to SUBSECTION 4.4(a)(viii) to the Reserve Account on such date) and (b) the Required Reserve Account Amount.
"AVAILABLE SPREAD ACCOUNT AMOUNT" means, for any Transfer Date, an amount equal to the lesser of (a) the amount on deposit in the Spread Account (exclusive of Investment Earnings on such date and before giving effect to any deposit to, or withdrawal from, the Spread Account
made or to be made with respect to such date) and (b) the Required Spread Account Amount, in each case on such Transfer Date.
"BASE RATE" means, for any Monthly Period, the annualized percentage equivalent of a fraction, the numerator of which is equal to the sum of (a) the Monthly Interest, (b) the Net Swap Payments and (c) the Noteholder Servicing Fee, each with respect to the related Distribution Date, and the denominator of which is the Collateral Amount plus amounts on deposit in the Principal Accumulation Account as of the close of business on the last day of such Monthly Period.
"CASH COLLATERAL ACCOUNT" is defined in SECTION 4.11(a)
"CLASS A ADDITIONAL INTEREST" is defined in SUBSECTION 4.2(a).
"CLASS A COUNTERPARTY" means Morgan Guaranty Trust Company of New York or the counterparty under any interest rate swap with respect to the Class A Notes obtained pursuant to SECTION 4.17.
"CLASS A DEFICIENCY AMOUNT" is defined in SUBSECTION 4.2(a).
"CLASS A/B EXPECTED PRINCIPAL PAYMENT DATE" means August 16, 2004.
"CLASS A MONTHLY INTEREST" is defined in SUBSECTION 4.2(a).
"CLASS A NET INTEREST OBLIGATION" means, for any Distribution Date: (a) if there are Class A Net Swap Payments due on that Distribution Date, the sum of the Class A Net Swap Payments and the Class A Monthly Interest for that Distribution Date; (b) if there are Class A Net Swap Receipts due on that Distribution Date, the result of the Class A Monthly Interest for that Distribution Date, MINUS the Class A Net Swap Receipts for that Distribution Date; and (c) if the Class A Swap has terminated for any reason, the Class A Monthly Interest for that Distribution Date.
"CLASS A NET SWAP PAYMENT" means, with respect to any Distribution Date, any net amount payable by the Issuer under the Class A Swap as a result of LIBOR being less than the Class A Swap Rate. For the avoidance of doubt, Class A Net Swap Payments do not include early termination payments or payment of breakage or other miscellaneous costs.
"CLASS A NET SWAP RECEIPT" means, with respect to any Distribution Date, any net amount payable by the Class A Counterparty as a result of LIBOR being greater than the Class A Swap Rate. For the avoidance of doubt, Class A Net Swap Receipts do not include early termination payments.
"CLASS A NOTE INITIAL PRINCIPAL BALANCE" means $702,000,000.
"CLASS A NOTE INTEREST RATE" means a per annum rate of 0.24% in excess of LIBOR as determined on the LIBOR Determination Date for the applicable Distribution Period.
"CLASS A NOTE PRINCIPAL BALANCE" means, on any date of determination, an amount equal to (a) the Class A Note Initial Principal Balance, MINUS (b) the aggregate amount of principal payments made to the Class A Noteholders on or prior to such date.
"CLASS A NOTEHOLDER" means the Person in whose name a Class A Note is registered in the Note Register.
"CLASS A NOTES" means any one of the Notes executed by the Issuer and authenticated by or on behalf of the Indenture Trustee, substantially in the form of EXHIBIT A-1.
"CLASS A REQUIRED AMOUNT" means, for any Distribution Date, an amount equal to the excess of the amounts described in SUBSECTION 4.4(a)(i) over the sum of (a) Available Finance Charge Collections applied to pay such amount pursuant to SUBSECTION 4.4(a) and (b) any amount withdrawn from the Cash Collateral Account and applied to pay such amount pursuant to SUBSECTION 4.11(c).
"CLASS A SWAP" means an interest rate swap agreement with respect to the Class A Notes between the Trust and the Class A Counterparty substantially in the form of EXHIBIT E-1 to this Indenture Supplement, or such other form as shall have satisfied the Rating Agency Condition.
"CLASS A SWAP RATE" means 4.87% per annum.
"CLASS B ADDITIONAL INTEREST" is defined in SUBSECTION 4.2(b).
"CLASS B COUNTERPARTY" means Morgan Guaranty Trust Company of New York or the counterparty under any interest rate swap with respect to the Class B Notes obtained pursuant to SECTION 4.17.
"CLASS B DEFICIENCY AMOUNT" is defined in SUBSECTION 4.2(b).
"CLASS B MONTHLY INTEREST" is defined in SUBSECTION 4.2(b).
"CLASS B NET INTEREST OBLIGATION" means, for any Distribution Date: (a) if there are Class B Net Swap Payments due on that Distribution Date, the sum of the Class B Net Swap Payments and the Class B Monthly Interest for that Distribution Date; (b) if there are Class B Net Swap Receipts due on that Distribution Date, the result of the Class B Monthly Interest for that Distribution Date, MINUS the Class B Net Swap Receipts for that Distribution Date; and (c) if the Class B Swap has terminated for any reason, the Class B Monthly Interest for that Distribution Date.
"CLASS B NET SWAP PAYMENT" means, with respect to any Distribution Date, any net amount payable by the Issuer under the Class B Swap as a result of LIBOR being less than the Class B Swap Rate. For the avoidance of doubt, Class B Net Swap Payments do not include early termination payments or payment of breakage or other miscellaneous costs.
"CLASS B NET SWAP RECEIPT" means, with respect to any Distribution Date, any net amount payable by the Class B Counterparty as a result of LIBOR being greater than the Class B
Swap Rate. For the avoidance of doubt, Class B Net Swap Receipts do not include early termination payments.
"CLASS B NOTE INITIAL PRINCIPAL BALANCE" means $76,500,000.
"CLASS B NOTE INTEREST RATE" means a per annum rate of 0.67% in excess of LIBOR as determined on the LIBOR Determination Date for the applicable Distribution Period.
"CLASS B NOTE PRINCIPAL BALANCE" means, on any date of determination, an amount equal to (a) the Class B Note Initial Principal Balance, MINUS (b) the aggregate amount of principal payments made to the Class B Noteholders on or prior to such date.
"CLASS B NOTEHOLDER" means the Person in whose name a Class B Note is registered in the Note Register.
"CLASS B NOTES" means any one of the Notes executed by the Issuer and authenticated by or on behalf of the Indenture Trustee, substantially in the form of EXHIBIT A-2.
"CLASS B REQUIRED AMOUNT" means, for any Distribution Date, an amount equal to the excess of the amount described in SUBSECTION 4.4(a)(ii) over the sum of (a) Available Finance Charge Collections applied to pay such amount pursuant to SUBSECTION 4.4(a) and (b) any amount withdrawn from the Cash Collateral Account and applied to pay such amount pursuant to SUBSECTION 4.11(c).
"CLASS B SWAP" means an interest rate swap agreement between the Trust and the Class B Counterparty substantially in the form of EXHIBIT E-2 to this Indenture Supplement, or such other form as shall have satisfied the Rating Agency Condition.
"CLASS B SWAP RATE" means 4.87% per annum.
"CLASS C ADDITIONAL INTEREST" is defined in SUBSECTION 4.2(c).
"CLASS C COUNTERPARTY" means Morgan Guaranty Trust Company of New York or the counterparty under any interest rate swap with respect to the Class C Notes obtained pursuant to SECTION 4.19.
"CLASS C DEFICIENCY AMOUNT" is defined in SUBSECTION 4.2(c).
"CLASS C EXPECTED PRINCIPAL PAYMENT DATE" means September 15, 2004.
"CLASS C MONTHLY INTEREST" is defined in SUBSECTION 4.2(c).
"CLASS C NET INTEREST OBLIGATION" means, for any Distribution Date: (a) if there are Class C Net Swap Payments due on that Distribution Date, the sum of the Class C Net Swap Payments and the Class C Monthly Interest for that Distribution Date; (b) if there are Class C Net Swap Receipts due on that Distribution Date, the result of the Class C Monthly Interest for that Distribution Date, MINUS the Class C Net Swap Receipts for that Distribution Date; and (c) if the
Class C Swap has terminated for any reason, the Class C Monthly Interest for that Distribution Date.
"CLASS C NET SWAP PAYMENT" means, with respect to any Distribution Date, any net amount payable by the Issuer under the Class C Swap as a result of LIBOR being less than the Class C Swap Rate. For the avoidance of doubt, Class C Net Swap Payments do not include early termination payments or payment of breakage or other miscellaneous costs.
"CLASS C NET SWAP RECEIPT" means, with respect to any Distribution Date, any net amount payable by the Class C Counterparty as a result of LIBOR being greater than the Class C Swap Rate. For the avoidance of doubt, Class C Net Swap Receipts do not include early termination payments.
"CLASS C NOTE INITIAL PRINCIPAL BALANCE" means $121,500,000.
"CLASS C NOTE INTEREST RATE" means the rate specified in the Class C Note Purchase Agreement; PROVIDED that the Class C Note Interest Rate shall not exceed a per annum rate of 1.70% in excess of LIBOR as determined on the LIBOR Determination Date for the applicable Distribution Period.
"CLASS C NOTE PRINCIPAL BALANCE" means, on any date of determination, an amount equal to (a) the Class C Note Initial Principal Balance, MINUS (b) the aggregate amount of principal payments made to the Class C Noteholders on or prior to such date.
"CLASS C NOTE PURCHASE AGREEMENT" means the Note Purchase Agreement, dated as of August 21, 2001, between WFN, the Transferor and the initial purchaser of the Class C Notes.
"CLASS C NOTEHOLDER" means the Person in whose name a Class C Note is registered in the Note Register.
"CLASS C NOTES" means any one of the Notes executed by the Issuer and authenticated by or on behalf of the Indenture Trustee, substantially in the form of EXHIBIT A-3.
"CLASS C SWAP" means an interest rate swap agreement with respect to the Class C Notes between the Trust and the Class C Counterparty substantially in the form of EXHIBIT E-3 to this Indenture Supplement, or such other form as shall have satisfied the Rating Agency Condition.
"CLASS C SWAP RATE" means 4.92% per annum.
"CLASS C SWAP REQUIRED AMOUNT" means, for any Distribution Date, an amount equal to the excess of the Class C Net Swap Payment for such Distribution Date over the sum of (a) Available Finance Charge Collections applied to pay such Class C Net Swap Payment pursuant to SUBSECTION 4.4(a)(iv)(B) and (b) any amount withdrawn from the Cash Collateral Account and applied to pay such Class C Net Swap Payment pursuant to SUBSECTION 4.11(c).
"CLOSING DATE" means August 21, 2001.
"COLLATERAL AMOUNT" means, as of any date of determination, an amount equal to the result of (a) the Initial Collateral Amount, MINUS (b) the amount of principal previously paid to the Series 2001-A Noteholders (other than any principal payments made from funds on deposit in the Spread Account), MINUS (c) the balance on deposit in the Principal Accumulation Account, MINUS (d) the excess, if any, of the aggregate amount of Investor Charge-Offs and Reallocated Principal Collections OVER the reimbursements of such amounts pursuant to SUBSECTION 4.4(a)(vi) prior to such date.
"CONTROLLED ACCUMULATION AMOUNT" means, (a) for any Transfer Date with respect to the Controlled Accumulation Period occurring prior to the August 2004 Distribution Date, $64,875,000 and (b) on the Transfer Date immediately preceding the Class C Expected Principal Payment Date, the Class C Note Principal Balance; PROVIDED, HOWEVER, that if the Controlled Accumulation Period Length is determined to be less than 12 months pursuant to SECTION 4.14 or 4.15, the amount described in CLAUSE (a) of this definition shall be equal to (i) the sum of the Class A Note Initial Principal Balance and the Class B Note Initial Principal Balance DIVIDED BY (ii) the Controlled Accumulation Period Length; PROVIDED, FURTHER, that the Controlled Accumulation Amount for any Distribution Date shall not exceed the Note Principal Balance minus any amount already on deposit in the Principal Accumulation Account on such Transfer Date.
"CONTROLLED ACCUMULATION PERIOD" means, unless an Early Amortization Event shall have occurred prior thereto, the period commencing at the opening of business on August 1, 2003 or such later date as is determined in accordance with SECTIONS 4.14 and 4.15, and ending on the first to occur of (a) the commencement of the Early Amortization Period and (b) the Series Termination Date.
"CONTROLLED ACCUMULATION PERIOD LENGTH" is defined in SUBSECTION 4.14.
"CONTROLLED DEPOSIT AMOUNT" means, for any Transfer Date with respect to the Controlled Accumulation Period, an amount equal to the sum of the Controlled Accumulation Amount for such Transfer Date and any existing Accumulation Shortfall.
"COUNTERPARTY" means the Class A Counterparty, the Class B Counterparty or the Class C Counterparty.
"COVERED AMOUNT" means an amount, determined as of each Transfer Date for any Distribution Period, equal to the sum of (a) the product of (i) the Class A Net Interest Obligation TIMES (ii) a fraction, (A) the numerator of which is equal to the aggregate amount on deposit in the Principal Accumulation Account, up to the Class A Note Principal Balance as of the Record Date preceding such Transfer Date, and (B) the denominator of which is equal to the Class A Note Principal Balance as of the Record Date preceding such Transfer Date PLUS (b) the product of (i) the Class B Net Interest Obligation TIMES (ii) a fraction (A) the numerator of which is equal to the aggregate amount on deposit in the Principal Accumulation Account in excess of the Class A Note Principal Balance as of the Record Date preceding such Transfer Date, up to the Class B Note Principal Balance as of the Record Date preceding such Transfer Date, and (B) the denominator of which is equal to the Class B Note Principal Balance as of the Record Date preceding such Transfer Date.
"DEFAULT AMOUNT" means, as to any Defaulted Account, the amount of Principal Receivables (other than Ineligible Receivables, unless there is an Insolvency Event with respect to WFN or the Transferor) in such Defaulted Account on the day it became a Defaulted Account.
"DEFAULTED ACCOUNT" means an Account in which there are Defaulted Receivables.
"DESIGNATED MATURITY" means, for any LIBOR Determination Date, one month; provided that LIBOR for the initial Distribution Period will be determined by straight-line interpolation (based on the actual number of days in the initial Distribution Period) between two rates determined in accordance with the definition of LIBOR, one of which will be determined for a Designated Maturity of one month and the other of which will be determined for a Designated Maturity of two months.
"DILUTION" means any downward adjustment made by Servicer in the amount of any Receivable (a) because of a rebate, refund, unauthorized charge, fraudulent or counterfeit charge or billing error to an accountholder, (b) because such Receivable was created in respect of merchandise which was refused or returned by an accountholder or (c) for any other reason other than receiving Collections therefor or charging off such amount as uncollectible.
"DISTRIBUTION ACCOUNT" is defined in SUBSECTION 4.9(a).
"DISTRIBUTION DATE" means October 15, 2001 and the 15th day of each calendar month thereafter, or if such 15th day is not a Business Day, the next succeeding Business Day.
"DISTRIBUTION PERIOD" means, for any Distribution Date, the period from and including the Distribution Date immediately preceding such Distribution Date (or, in the case of the first Distribution Date, from and including the Closing Date) to but excluding such Distribution Date.
"EARLY AMORTIZATION PERIOD" means the period commencing on the date on which a Trust Early Amortization Event or a Series 2001-A Early Amortization Event is deemed to occur and ending on the Series Termination Date.
"ELIGIBLE INVESTMENTS" is defined in Annex A to the Indenture; provided that solely for purposes of Section 4.12(b), references to the "highest investment category" of S&P shall mean A-2.
"EXCESS SPREAD PERCENTAGE" means, for any Monthly Period, a percentage equal to the Portfolio Yield for such Monthly Period, MINUS the Base Rate for such Monthly Period.
"FINANCE CHARGE ACCOUNT" is defined in SECTION 4.9(a).
"FINANCE CHARGE COLLECTIONS" means Collections of Finance Charge Receivables.
"FINANCE CHARGE SHORTFALL" is defined in SECTION 4.7.
"GROUP ONE" means Series 2001-A, the outstanding Series under (and as defined in) the Pooling and Servicing Agreement (other than Series represented by the Collateral Certificate)
and each other Series hereafter specified in the related Indenture Supplement to be included in Group One.
"INITIAL COLLATERAL AMOUNT" means $900,000,000.
"INVESTMENT EARNINGS" means, for any Distribution Date, all interest and earnings on Eligible Investments included in the Spread Account (net of losses and investment expenses) during the period commencing on and including the Distribution Date immediately preceding such Distribution Date and ending on but excluding such Distribution Date.
"INVESTOR CHARGE-OFFS" is defined in SECTION 4.5.
"INVESTOR DEFAULT AMOUNT" means, with respect to any Defaulted Account, an amount equal to the product of (a) the Default Amount and (b) the Allocation Percentage on the day such Account became a Defaulted Account.
"INVESTOR FINANCE CHARGE COLLECTIONS" means, for any Monthly Period, an amount equal to the aggregate amount of Finance Charge Collections (including Net Recoveries treated as Finance Charge Collections) retained or deposited in the Finance Charge Account for Series 2001-A pursuant to SUBSECTION 4.1(b)(i) for such Monthly Period.
"INVESTOR PRINCIPAL COLLECTIONS" means, for any Monthly Period, an amount equal to the aggregate amount of Principal Collections retained or deposited in the Principal Account for Series 2001-A pursuant to SUBSECTION 4.1(b)(ii) for such Monthly Period.
"INVESTOR UNCOVERED DILUTION AMOUNT" means an amount equal to the product
of (x) the Series Allocation Percentage for the related Monthly Period
(determined on a weighted average basis, if a Reset Date occurs during that
Monthly Period), TIMES (y) the aggregate Dilutions occurring during that Monthly
Period as to which any deposit is required to be made to the Excess Funding
Account pursuant to SECTION 3.9(a) of the Transfer and Servicing Agreement or
SECTION 3.9(a) of the Pooling and Servicing Agreement but has not been made,
PROVIDED that, if the Transferor Amount is greater than zero at the time the
deposit referred to in CLAUSE (y) is required to be made, the Investor Uncovered
Dilution Amount for such amount to be deposited shall be deemed to be zero.
"LIBOR" means, for any Distribution Period, an interest rate per annum for each Distribution Period determined by the Indenture Trustee in accordance with the provisions of SECTION 4.16.
"LIBOR DETERMINATION DATE" means (i) August 17, 2001 for the period from and including the Closing Date through and including October 14, 2001 and (ii) the second London Business Day prior to the commencement of the second and each subsequent Distribution Period.
"LONDON BUSINESS DAY" means any day on which dealings in deposits in United States dollars are transacted in the London interbank market.
"MINIMUM TRANSFEROR AMOUNT" means (a) prior to the Certificate Trust Termination Date, the "Minimum Transferor Amount" under (and as defined in) the Pooling and Servicing
Agreement and (b) on and after the Certificate Trust Termination Date, the "Minimum Transfer Amount" as defined in Annex A to the Indenture.
"MONTHLY INTEREST" means, for any Distribution Date, the sum of the Class A Monthly Interest, the Class B Monthly Interest, and the Class C Monthly Interest for such Distribution Date.
"MONTHLY PERIOD" means the period from and including the first day of the calendar month preceding a related Distribution Date to and including the last day of such calendar month; PROVIDED that the Monthly Period related to the October 2001 Distribution Date shall mean the period from and including the Closing Date to and including the last day of September, 2001.
"MONTHLY PRINCIPAL" is defined in SECTION 4.3.
"MONTHLY PRINCIPAL REALLOCATION AMOUNT" means, for any Monthly Period, an amount equal to the sum of:
(a) the lower of (i) the Class A Required Amount and (ii) the greater of (A)(x) the product of (I) 22.00% and (II) the Initial Collateral Amount MINUS (y) the amount of unreimbursed Investor Charge-Offs (after giving effect to Investor Charge-Offs for the related Monthly Period) and unreimbursed Reallocated Principal Collections (as of the previous Distribution Date) and (B) zero; and
(b) the lower of (i) the sum of the Class B Required Amount, the
Servicing Fee Required Amount and the Class C Swap Required Amount and
(ii) the greater of (A)(x) the product of (I) 13.5% and (II) the Initial
Collateral Amount MINUS (y) the amount of unreimbursed Investor
Charge-Offs (after giving effect to Investor Charge-Offs for the related
Monthly Period) and unreimbursed Reallocated Principal Collections (as of
the previous Distribution Date and as required in CLAUSE (a) above) and
(B) zero.
"NET INTEREST OBLIGATION" means, for any Distribution Date, the sum of the Class A Net Interest Obligation, the Class B Net Interest Obligation and the Class C Net Interest Obligation for such Distribution Date.
"NET SWAP PAYMENTS" means, with respect to any Distribution Date, collectively, the Class A Net Swap Payment, the Class B Net Swap Payment and the Class C Net Swap Payment for such Distribution Date.
"NET SWAP RECEIPTS" means, collectively, the Class A Net Swap Receipt, the Class B Net Swap Receipt and the Class C Net Swap Receipt for such Distribution Date.
"NOTE PRINCIPAL BALANCE" means, on any date of determination, an amount equal to the sum of the Class A Note Principal Balance, the Class B Note Principal Balance and the Class C Note Principal Balance.
"NOTEHOLDER SERVICING FEE" is defined in SECTION 3.1.
"PERCENTAGE ALLOCATION" is defined in SUBSECTION 4.1(b)(ii)(y).
"PORTFOLIO ADJUSTED YIELD" means, with respect to any Transfer Date, the average of the percentages obtained for each of the three preceding Monthly Periods by subtracting the Base Rate from the Portfolio Yield for such Monthly Period and deducting 0.50% from the result for each Monthly Period.
"PORTFOLIO YIELD" means, for any Monthly Period, the annualized percentage equivalent of a fraction, (a) the numerator of which is equal to (i) the Available Finance Charge Collections (excluding any Excess Finance Charge Collections), MINUS (ii) the Aggregate Investor Default Amount and the Uncovered Dilution Amount for such Monthly Period and (b) the denominator of which is the Collateral Amount plus amounts on deposit in Principal Accumulation Account as of the close of business on the last day of such Monthly Period.
"PRINCIPAL ACCOUNT" is defined in Section 4.9(a).
"PRINCIPAL ACCUMULATION ACCOUNT" is defined in SUBSECTION 4.9(a).
"PRINCIPAL ACCUMULATION ACCOUNT BALANCE" means, for any date of determination, the principal amount, if any, on deposit in the Principal Accumulation Account on such date of determination.
"PRINCIPAL ACCUMULATION INVESTMENT PROCEEDS" means, with respect to each Transfer Date, the investment earnings on funds in the Principal Accumulation Account (net of investment expenses and losses) for the period from and including the immediately preceding Transfer Date to but excluding such Transfer Date.
"PRINCIPAL COLLECTIONS" means Collections of Principal Receivables.
"PRINCIPAL SHORTFALL" is defined in SUBSECTION 4.8.
"QUALIFIED MATURITY AGREEMENT" means an agreement whereby an Eligible Institution agrees to make a deposit into the Principal Accumulation Account on the Class A/B Expected Principal Payment Date in an amount equal to the initial Note Principal Balance (excluding the Class C Note Initial Principal Balance) and a further deposit into the Principal Accumulation Account on the Class C Expected Principal Payment Date in an amount equal to the Class C Note Initial Principal Balance.
"QUARTERLY EXCESS SPREAD PERCENTAGE" means (a) with respect to the October
2001 Distribution Date, the Excess Spread Percentage for such Distribution Date,
(b) with respect to the November 2001 Distribution Date, the percentage
equivalent of a fraction the numerator of which is the sum of (i) the Excess
Spread Percentage for the October 2001 Distribution Date and (ii) the Excess
Spread Percentage with respect to the November 2001 Distribution Date and the
denominator of which is two, (c) with respect to the December 2001 Distribution
Date, the percentage equivalent of a fraction the numerator of which is the sum
of (i) the Excess Spread Percentage for the October 2001 Distribution Date (ii)
the Excess Spread Percentage with respect to the November 2001 Distribution Date
and (iii) the Excess Spread Percentage with respect to the December 2001
Distribution Date and the denominator of which is three and (d) with respect
to the January 2002 Distribution Date and each Distribution Date thereafter, the percentage equivalent of a fraction the numerator of which is the sum of the Excess Spread Percentages determined with respect to such Distribution Date and the immediately preceding two Distribution Dates and the denominator of which is three.
"RATING AGENCY" means each of Fitch, Moody's and Standard & Poor's.
"REALLOCATED PRINCIPAL COLLECTIONS" means, for any Transfer Date, Investor Principal Collections applied in accordance with SECTION 4.6 in an amount not to exceed the Monthly Principal Reallocation Amount for the related Monthly Period.
"REASSIGNMENT AMOUNT" means, for any Transfer Date, after giving effect to any deposits and distributions otherwise to be made on the related Distribution Date, the sum of (i) the Note Principal Balance on the related Distribution Date, PLUS (ii) Monthly Interest for the related Distribution Date and any Monthly Interest previously due but not distributed to the Series 2001-A Noteholders, PLUS (iii) the amount of Additional Interest, if any, for the related Distribution Date and any Additional Interest previously due but not distributed to the Series 2001-A Noteholders on a prior Distribution Date.
"REFERENCE BANKS" means four major banks in the London interbank market selected by the Servicer.
"REQUIRED CASH COLLATERAL AMOUNT" means, for any Transfer Date, the greatest of (a) an amount equal to 2.5% of the Collateral Amount (after taking into account deposits to the Principal Accumulation Account on such Transfer Date and payments to be made on the related Distribution Date), (b) $9,000,000 and (c) for any Transfer Date occurring on or after the commencement of the Early Amortization Period, an amount equal to 2.5% of the Collateral Amount as of the close of business on the last day of the Revolving Period; PROVIDED that the Required Cash Collateral Amount will never exceed the Note Principal Balance, MINUS the Principal Accumulation Account Balance (after taking into account deposits to the Principal Accumulation Account on such Transfer Date and payments to be made on the related Distribution Date); and PROVIDED, FURTHER, that the Transferor may reduce the Required Cash Collateral Amount at any time if the Indenture Trustee has been provided evidence that the Rating Agency Condition has been satisfied.
"REQUIRED DRAW AMOUNT" is defined in SUBSECTION 4.11(c).
"REQUIRED RESERVE ACCOUNT AMOUNT" means, for any Transfer Date on or after the Reserve Account Funding Date, an amount equal to (a) 0.50% of the sum of the Class A Note Principal Balance and the Class B Note Principal Balance or (b) any other amount designated by the Transferor; PROVIDED, HOWEVER, that if such designation is of a lesser amount, the Transferor shall (i) provide the Servicer and the Indenture Trustee with evidence that the Rating Agency Condition shall have been satisfied and (ii) deliver to the Indenture Trustee a certificate of an Authorized Officer to the effect that, based on the facts known to such officer at such time, in the reasonable belief of the Transferor, such designation will not cause an Early Amortization Event or an event that, after the giving of notice or the lapse of time, would cause an Early Amortization Event to occur with respect to Series 2001-A.
"REQUIRED RETAINED TRANSFEROR PERCENTAGE" means, for purposes of Series 2001-A, 4%.
"REQUIRED SPREAD ACCOUNT AMOUNT" means, for any Distribution Date, (a) the product of (i) the Spread Account Percentage in effect on such date and (ii) during (x) the Revolving Period, the Collateral Amount, and (y) thereafter, the Collateral Amount as of the last day of the Revolving Period; PROVIDED, that in no event will the Required Spread Account Amount exceed the Class C Note Principal Balance (after taking into account any payments to be made on such Distribution Date).
"RESERVE ACCOUNT" is defined in SUBSECTION 4.10(a).
"RESERVE ACCOUNT FUNDING DATE" means the Transfer Date designated by the Servicer which occurs not later than the earliest of (a) the Transfer Date with respect to the Monthly Period which commences 3 months prior to the commencement of the Controlled Accumulation Period (which commencement shall be subject to postponement pursuant to SECTION 4.15); (b) the first Transfer Date for which the Portfolio Adjusted Yield is less than 2%, but in such event the Reserve Account Funding Date shall not be required to occur earlier than the Transfer Date with respect to the Monthly Period which commences 12 months prior to the commencement of the Controlled Accumulation Period; (c) the first Transfer Date for which the Portfolio Adjusted Yield is less than 3%, but in such event the Reserve Account Funding Date shall not be required to occur earlier than the Transfer Date with respect to the Monthly Period which commences 6 months prior to the commencement of the Controlled Accumulation Period; and (d) the first Transfer Date for which the Portfolio Adjusted Yield is less than 4%, but in such event the Reserve Account Funding Date shall not be required to occur earlier than the Transfer Date with respect to the Monthly Period which commences 4 months prior to the commencement of the Controlled Accumulation Period; PROVIDED, HOWEVER, that subject to satisfaction of the Rating Agency Condition, the Reserve Account Funding Date may be any date selected by the Servicer.
"RESERVE ACCOUNT SURPLUS" means, as of any Transfer Date following the Reserve Account Funding Date, the amount, if any, by which the amount on deposit in the Reserve Account exceeds the Required Reserve Account Amount.
"RESERVE DRAW AMOUNT" means, with respect to each Transfer Date relating to the Controlled Accumulation Period or the first Transfer Date relating to the Early Amortization Period, the amount, if any, by which the Principal Accumulation Investment Proceeds for such Distribution Date are less than the Covered Amount determined as of such Transfer Date.
"RESET DATE" means:
(a) each Addition Date and each "Addition Date" (as such term is defined in the Pooling and Servicing Agreement), in each case relating to Supplemental Accounts;
(b) each Removal Date and each "Removal Date" (as such term is defined in the Pooling and Servicing Agreement) on which, if any Series of Notes or any Series under (and as defined in) the Pooling and Servicing Agreement has been paid in full, Principal Receivables equal to the Initial Collateral Amount for that Series are removed from the Receivables Trust;
(c) each date on which there is an increase in the outstanding balance of any Variable Interest or "Variable Interest" (as such term is defined in the Pooling and Servicing Agreement); and
(d) each date on which a new Series or Class of Notes is issued and each date on which a new "Series" or "Class" (each as defined in the Pooling and Servicing Agreement) of investor certificates is issued by the Certificate Trust.
"REVOLVING PERIOD" means the period beginning on the Closing Date and ending at the close of business on the day immediately preceding the earlier of the day the Controlled Accumulation Period commences or the day the Early Amortization Period commences.
"SERIES 2001-A" means the Series of Notes the terms of which are specified in this Indenture Supplement.
"SERIES 2001-A EARLY AMORTIZATION EVENT" is defined in SECTION 6.1.
"SERIES 2001-A FINAL MATURITY DATE" means the June 2008 Distribution Date.
"SERIES 2001-A NOTE" means a Class A Note, a Class B Note or a Class C Note.
"SERIES 2001-A NOTEHOLDER" means a Class A Noteholder, a Class B Noteholder or a Class C Noteholder.
"SERIES ALLOCATION PERCENTAGE" means, with respect to any Monthly Period, the percentage equivalent of a fraction, the numerator of which is the numerator used in determining the Allocation Percentage for Finance Charge Collections for that Monthly Period and the denominator of which is the sum of the numerators used in determining the Allocation Percentage for Finance Charge Receivables for all outstanding Series on such date of determination; PROVIDED that if one or more Reset Dates occur in a Monthly Period, the Series Allocation Percentage for the portion of the Monthly Period falling on and after each such Reset Date and prior to any subsequent Reset Date will be determined using a denominator which is equal to the sum of the numerators used in determining the Allocation Percentage for Finance Charge Receivables for all outstanding Series as of the close of business on the subject Reset Date.
"SERIES SERVICING FEE PERCENTAGE" means 2% PER ANNUM.
"SERIES TERMINATION DATE" means the earliest to occur of (a) the date on which the Note Principal Balance is paid in full, (b) the date on which the Collateral Amount is reduced to zero and (c) the Series 2001-A Final Maturity Date.
"SERVICING FEE REQUIRED AMOUNT" means, for any Distribution Date, an amount equal to the excess of the amount described in SUBSECTION 4.4(a)(iii) over the (a) Available Finance Charge Collections applied to pay such amount pursuant to SUBSECTION 4.4(a) and (b) any amount withdrawn from the Cash Collateral Account and applied to pay such amount pursuant to SUBSECTION 4.11(c).
"SPECIFIED TRANSFEROR AMOUNT" means, at any time, the Minimum Transferor Amount (including the Additional Minimum Transferor Amount, if any) at that time.
"SPREAD ACCOUNT" is defined in SUBSECTION 4.12(a).
"SPREAD ACCOUNT DEFICIENCY" means the excess, if any, of the Required Spread Account Amount over the Available Spread Account Amount.
"SPREAD ACCOUNT PERCENTAGE" is defined in the Class C Note Purchase Agreement.
"TARGET AMOUNT" is defined in SUBSECTION 4.1(b)(i).
"TELERATE PAGE 3750" means the display page currently so designated on the Bridge Telerate Markets Report (or such page as may replace that page in that service for the purpose of displaying comparable rates or prices).
"UNCOVERED DILUTION AMOUNT" means an amount equal to the product of (x) the Series Allocation Percentage for the related Monthly Period (determined on a weighted average basis, if a Reset Date occurs during that Monthly Period), TIMES (y) the aggregate Dilutions occurring during that Monthly Period as to which any deposit is required to be made to the Excess Funding Account pursuant to SECTION 3.9(a) of the Transfer and Servicing Agreement or SECTION 3.9(a) of the Pooling and Servicing Agreement but has not been made; PROVIDED that, if the Transferor Amount is greater than zero at the time the deposit referred to in clause (y) is required to be made, the Uncovered Dilution Amount for such amount to be deposited shall be deemed to be zero.
(b) Each capitalized term defined herein shall relate to the Series 2001-A Notes and no other Series of Notes issued by the Trust, unless the context otherwise requires. All capitalized terms used herein and not otherwise defined herein have the meanings ascribed to them in Annex A to the Master Indenture.
(c) The interpretive rules specified in SECTION 1.2 of the Master Indenture also apply to this Indenture Supplement. If any term or provision contained herein shall conflict with or be inconsistent with any term or provision contained in the Master Indenture, the terms and provisions of this Indenture Supplement shall be controlling.
ARTICLE III.
NOTEHOLDER SERVICING FEE
Section 3.1 SERVICING COMPENSATION. The share of the Servicing Fee allocable to Series 2001-A for any Transfer Date (the "NOTEHOLDER SERVICING FEE") shall be equal to one-twelfth of the product of (a) the Series Servicing Fee Percentage and (b) the Collateral Amount as of the last day of the Monthly Period preceding such Transfer Date; PROVIDED, HOWEVER, that with respect to the first Transfer Date, the Noteholder Servicing Fee shall be equal to $2,050,000. The remainder of the Servicing Fee shall be paid by the holders of the Transferor Interest or the noteholders of other Series (as provided in the related Indenture Supplements) and in no event shall the Trust, the Indenture Trustee or the Series 2001-A Noteholders be liable for
the share of the Servicing Fee to be paid by the holders of the Transferor Interest or the noteholders of any other Series.
Section 3.2 REPRESENTATIONS AND WARRANTIES. The parties hereto agree that the representations, warranties and covenants set forth in Schedule I shall be a part of this Indenture Supplement for all purposes.
ARTICLE IV.
RIGHTS OF SERIES 2001-A NOTEHOLDERS AND ALLOCATION AND APPLICATION OF
COLLECTIONS
Section 4.1 COLLECTIONS AND ALLOCATIONS
(a) ALLOCATIONS. Finance Charge Collections, Principal Collections and Defaulted Receivables allocated to Series 2001-A pursuant to ARTICLE VIII of the Indenture shall be allocated and distributed as set forth in this Article.
(b) ALLOCATIONS TO THE SERIES 2001-A NOTEHOLDERS. The Servicer shall on the Date of Processing, allocate to the Series 2001-A Noteholders the following amounts as set forth below:
(i) ALLOCATIONS OF FINANCE CHARGE COLLECTIONS. The Servicer shall allocate to the Series 2001-A Noteholders an amount equal to the product of (A) the Allocation Percentage and (B) the aggregate Finance Charge Collections processed on such Date of Processing and shall deposit such amount into the Finance Charge Account, PROVIDED that, with respect to each Monthly Period falling in the Revolving Period (and with respect to that portion of each Monthly Period in the Controlled Accumulation Period falling on or after the day on which Collections of Principal Receivables equal to the related Controlled Deposit Amount have been allocated pursuant to SECTION 4.1(b)(ii) and deposited pursuant to SECTION 4.1(c)), so long as the Available Cash Collateral Amount is not less than the Required Cash Collateral Amount on such Date of Processing, Collections of Finance Charge Receivables shall be transferred into the Finance Charge Account only until such time as the aggregate amount so deposited equals the sum (the "TARGET AMOUNT") of (A) the Net Interest Obligation for the related Distribution Date, (B) if WFN is not the Servicer, the Noteholder Servicing Fee (and if WFN is the Servicer, then amounts that otherwise would have been transferred into the Finance Charge Account pursuant to this CLAUSE (B) shall instead by returned to WFN as payment of the Noteholder Servicing Fee), (C) any amount required to be deposited in the Reserve Account, the Spread Account and the Cash Collateral Account on the related Transfer Date and (D) if the Excess Spread Percentage for the preceding Monthly Period was less than 3%, the sum of Default Amounts and any Uncovered Dilution Amounts for the portion of the current Monthly Period that has elapsed through such Date of Processing; PROVIDED FURTHER, that, notwithstanding the preceding proviso, if on any Business Day the Servicer determines that the Target Amount for a Monthly Period exceeds the Target Amount for that Monthly Period as previously calculated by Servicer, then (x) Servicer shall (on the same Business Day) inform Transferor of such determination, and (y) within two Business Days of receiving such notice Transferor shall deposit into the Finance Charge Account funds in an amount equal to the amount of Collections of Finance
Charge Receivables allocated to the Noteholders for that Monthly Period but not deposited into the Finance Charge Account due to the operation of the preceding proviso (but not in excess of the amount required so that the aggregate amount deposited for the subject Monthly Period equals the Target Amount); and PROVIDED, FURTHER, if on any Transfer Date the Transferor Amount is less than the Specified Transferor Amount after giving effect to all transfers and deposits on that Transfer Date, Transferor shall, on that Transfer Date, deposit into the Principal Account funds in an amount equal to the amounts of Available Finance Charge Collections that are required to be treated as Available Principal Collections pursuant to SECTION 4.4(a)(v) and (vi) but are not available from funds in the Finance Charge Account as a result of the operation of second preceding proviso.
With respect to any Monthly Period when deposits of Collections of Finance
Charge Receivables into the Finance Charge Account are limited to deposits up to
the Target Amount in accordance with CLAUSE (i) above, notwithstanding such
limitation: (1) "REALLOCATED PRINCIPAL COLLECTIONS" for the related Transfer
Date shall be calculated as if the full amount of Finance Charge Collections
allocated to the Noteholders during that Monthly Period had been deposited in
the Finance Charge Account and applied on such Transfer Date in accordance with
SECTION 4.4(a); and (2) Collections of Finance Charge Receivables released to
Transferor pursuant to such SECTION 4.1(b)(i) shall be deemed, for purposes of
all calculations under this Indenture Supplement, to have been retained in the
Finance Charge Account and applied to the items specified in SECTIONS 4.4(a) to
which such amounts would have been applied (and in the priority in which they
would have been applied) had such amounts been available in the Finance Charge
Account on such Transfer Date. To avoid doubt, the calculations referred to in
the preceding CLAUSE (2) include the calculations required by CLAUSE (d) of the
definition of Collateral Amount and by the definition of Portfolio Yield.
(ii) ALLOCATIONS OF PRINCIPAL COLLECTIONS. The Servicer shall allocate to the Series 2001-A Noteholders the following amounts as set forth below:
(x) ALLOCATIONS DURING THE REVOLVING PERIOD.
(1) During the Revolving Period an amount equal to the product of the Allocation Percentage and the aggregate amount of Principal Collections processed on such Date of Processing, shall be allocated to the Series 2001-A Noteholders and first, if any other Principal Sharing Series is outstanding and in its accumulation period or amortization period, retained in the Principal Account for application, to the extent necessary, as Shared Principal Collections to other Principal Sharing Series on the related Distribution Date, second deposited in the Excess Funding Account to the extent necessary so that the Transferor Amount is not less than the Specified Transferor Amount and third paid to the holders of the Transferor Interest.
(2) With respect to each Monthly Period falling in the Revolving Period, to the extent that Collections of Principal Receivables allocated to the Series 2001-A Noteholders pursuant to this SUBSECTION 4.1(b)(ii) are paid to Transferor, Transferor shall make an amount equal to the Reallocated Principal
Collections for the related Transfer Date available on that Transfer Date for application in accordance with SECTION 4.6.
(y) ALLOCATIONS DURING THE CONTROLLED ACCUMULATION PERIOD. During the Controlled Accumulation Period an amount equal to the product of the Allocation Percentage and the aggregate amount of Principal Collections processed on such Date of Processing (the product for any such date is hereinafter referred to as a "PERCENTAGE ALLOCATION") shall be allocated to the Series 2001-A Noteholders and transferred to the Principal Account until applied as provided herein; PROVIDED, HOWEVER, that if the sum of such Percentage Allocation and all preceding Percentage Allocations with respect to the same Monthly Period exceeds the Controlled Deposit Amount during the Controlled Accumulation Period for the related Distribution Date, then such excess shall not be treated as a Percentage Allocation and shall be first, if any other Principal Sharing Series is outstanding and in its accumulation period or amortization period, retained in the Principal Account for application, to the extent necessary, as Shared Principal Collections to other Principal Sharing Series on the related Distribution Date, second deposited in the Excess Funding Account to the extent necessary so that the Transferor Amount is not less than the Specified Transferor Amount and third paid to the holders of the Transferor Interest.
(z) ALLOCATIONS DURING THE EARLY AMORTIZATION PERIOD. During the Early Amortization Period, an amount equal to the product of the Allocation Percentage and the aggregate amount of Principal Collections processed on such Date of Processing shall be allocated to the 2001-A Noteholders and transferred to the Principal Account until applied as provided herein; PROVIDED, HOWEVER, that after the date on which an amount of such Principal Collections equal to the Note Principal Balance has been deposited into the Principal Account such amount shall be first, if any other Principal Sharing Series is outstanding and in its accumulation period or amortization period, retained in the Principal Account for application, to the extent necessary, as Shared Principal Collections to other Principal Sharing Series on the related Distribution Date, second deposited in the Excess Funding Account to the extent necessary so that the Transferor Amount is not less than the Specified Transferor Amount and third paid to the holders of the Transferor Interest.
(c) During any period when Servicer is permitted by SECTION 4.3 of the Pooling and Servicing Agreement or SECTION 8.4 of the Indenture to make a single monthly deposit to the Collection Account, amounts allocated to the Noteholders pursuant to SECTIONS 4.1(a) and (b) with respect to any Monthly Period need not be deposited into the Collection Account or any Series Account prior to the related Transfer Date, and, when so deposited, (x) may be deposited net of any amounts required to be distributed to Transferor and, if WFN is Servicer, Servicer, and (y) shall be deposited into the Finance Charge Account (in the case of Collections of Finance Charge Receivables) and the Principal Account (in the case of Collections of Principal Receivables (not including any Shared Principal Collections allocated to Series 2001-A pursuant to SECTION 4.15 of the Pooling and Servicing Agreement or SECTION 8.5 of the Indenture)).
(d) On any date, Servicer may withdraw from the Collection Account or any Series Account any amounts inadvertently deposited in such account that should have not been so deposited.
Section 4.2 DETERMINATION OF MONTHLY INTEREST.
(a) The amount of monthly interest ("CLASS A MONTHLY INTEREST")
distributable from the Distribution Account with respect to the Class A Notes on
any Distribution Date shall be an amount equal to the product of (i) (A) a
fraction, the numerator of which is the actual number of days in the related
Distribution Period and the denominator of which is 360, times (B) the Class A
Note Interest Rate in effect with respect to the related Distribution Period and
(ii) the Class A Note Principal Balance as of the close of business on the last
day of the preceding Monthly Period (or, with respect to the initial
Distribution Date, the Class A Note Initial Principal Balance).
On the Determination Date preceding each Distribution Date, the Servicer shall determine the excess, if any (the "CLASS A DEFICIENCY AMOUNT"), of (x) the aggregate amount accrued pursuant to this SECTION 4.2(a) as of the prior Distribution Date OVER (y) the amount actually transferred from the Distribution Account for payment of such amount. If the Class A Deficiency Amount for any Distribution Date is greater than zero, on each subsequent Distribution Date until such Class A Deficiency Amount is fully paid, an additional amount ("CLASS A ADDITIONAL INTEREST") equal to the product of (i) (A) a fraction, the numerator of which is the actual number of days in the related Distribution Period and the denominator of which is 360, times (B) the Class A Note Interest Rate in effect with respect to the related Distribution Period PLUS 2% per annum and (ii) such Class A Deficiency Amount (or the portion thereof which has not been paid to the Class A Noteholders) shall be payable as provided herein with respect to the Class A Notes. Notwithstanding anything to the contrary herein, Class A Additional Interest shall be payable or distributed to the Class A Noteholders only to the extent permitted by applicable law.
(b) The amount of monthly interest ("CLASS B MONTHLY INTEREST")
distributable from the Distribution Account with respect to the Class B Notes on
any Distribution Date shall be an amount equal to the product of (i) (A) a
fraction, the numerator of which is the actual number of days in the related
Distribution Period and the denominator of which is 360, times (B) the Class B
Note Interest Rate in effect with respect to the related Distribution Period and
(ii) the Class B Note Principal Balance as of the close of business on the last
day of the preceding Monthly Period (or, with respect to the initial
Distribution Date, the Class B Note Initial Principal Balance).
On the Determination Date preceding each Distribution Date, the Servicer shall determine the excess, if any (the "CLASS B DEFICIENCY AMOUNT"), of (x) the aggregate amount accrued pursuant to this SECTION 4.2(b) as of the prior Distribution Date OVER (y) the amount of funds actually transferred from the Distribution Account for payment of such amount. If the Class B Deficiency Amount for any Distribution Date is greater than zero, on each subsequent Distribution Date until such Class B Deficiency Amount is fully paid, an additional amount ("CLASS B ADDITIONAL INTEREST") equal to the product of (i)(A) a fraction, the numerator of which is the actual number of days in the related Distribution Period and the denominator of which is
360, times (B) the Class B Note Interest Rate in effect with respect to the related Distribution Period PLUS 2% per annum and (ii) such Class B Deficiency Amount (or the portion thereof which has not been paid to the Class B Noteholders) shall be payable as provided herein with respect to the Class B Notes. Notwithstanding anything to the contrary herein, Class B Additional Interest shall be payable or distributed to the Class B Noteholders only to the extent permitted by applicable law.
(c) The amount of monthly interest ("CLASS C MONTHLY INTEREST")
distributable from the Distribution Account with respect to the Class C Notes on
any Distribution Date shall be an amount equal to the product of (i) (A) a
fraction, the numerator of which is the actual number of days in the related
Distribution Period and the denominator of which is 360, times (B) the Class C
Note Interest Rate in effect with respect to the related Distribution Period and
(ii) the Class C Note Principal Balance as of the close of business on the last
day of the preceding Monthly Period (or, with respect to the initial
Distribution Date, the Class C Note Initial Principal Balance).
On the Determination Date preceding each Distribution Date, the Servicer shall determine the excess, if any (the "CLASS C DEFICIENCY AMOUNT"), of (x) the aggregate amount accrued pursuant to this SECTION 4.2(c) as of the prior Distribution Date OVER (y) the amount of funds actually transferred from the Distribution Account for payment of such amount. If the Class C Deficiency Amount for any Distribution Date is greater than zero, on each subsequent Distribution Date until such Class C Deficiency Amount is fully paid, an additional amount ("CLASS C ADDITIONAL INTEREST") equal to the product of (i) (A) a fraction, the numerator of which is the actual number of days in the related Distribution Period and the denominator of which is 360, TIMES (B) the Class C Note Interest Rate in effect with respect to the related Distribution Period PLUS 2% per annum and (ii) such Class C Deficiency Amount (or the portion thereof which has not been paid to the Class C Noteholders) shall be payable as provided herein with respect to the Class C Notes. Notwithstanding anything to the contrary herein, Class C Additional Interest shall be payable or distributed to the Class C Noteholders only to the extent permitted by applicable law.
Section 4.3 DETERMINATION OF MONTHLY PRINCIPAL. The amount of monthly principal to be transferred from the Principal Account with respect to the Notes on each Transfer Date (the "MONTHLY PRINCIPAL"), beginning with the Transfer Date in the month following the month in which the Controlled Accumulation Period or, if earlier, the Early Amortization Period, begins, shall be equal to the least of (i) the Available Principal Collections on deposit in the Principal Account with respect to such Transfer Date, (ii) for each Transfer Date with respect to the Controlled Accumulation Period, the Controlled Deposit Amount for such Transfer Date, (iii) the Collateral Amount (after taking into account any adjustments to be made on such Distribution Date pursuant to SECTIONS 4.5 and 4.6) prior to any deposit into the Principal Accumulation Account on such Transfer Date, and (iv) the Note Principal Balance, minus any amount already on deposit in the Principal Accumulation Account on such Transfer Date.
Section 4.4 APPLICATION OF AVAILABLE FINANCE CHARGE COLLECTIONS AND AVAILABLE PRINCIPAL COLLECTIONS. On or before each Transfer Date, the Servicer shall instruct the Indenture Trustee in writing (which writing shall be substantially in the form of EXHIBIT B) to withdraw and the Indenture Trustee, acting in accordance with such instructions, shall withdraw on such
Transfer Date or related Distribution Date, as applicable, to the extent of available funds, the amount required to be withdrawn from the Finance Charge Account, the Principal Account, the Principal Funding Account and the Distribution Account as follows:
(a) On each Transfer Date, an amount equal to the Available Finance Charge Collections with respect to the related Distribution Date will be distributed or deposited in the following priority:
(i) on a pari passu basis (A) an amount equal to Class A Monthly Interest for such Distribution Date, PLUS any Class A Deficiency Amount, PLUS the amount of any Class A Additional Interest for such Distribution Date, PLUS the amount of any Class A Additional Interest previously due but not distributed to Class A Noteholders on a prior Distribution Date shall be deposited by the Servicer or Indenture Trustee into the Distribution Account , and (B) any Class A Net Swap Payment for such Distribution Date shall be paid to the Class A Swap Counterparty;
(ii) on a pari passu basis (A) an amount equal to Class B Monthly Interest for such Distribution Date, PLUS any Class B Deficiency Amount, PLUS the amount of any Class B Additional Interest for such Distribution Date, PLUS the amount of any Class B Additional Interest previously due but not distributed to Class B Noteholders on a prior Distribution Date shall be deposited by the Servicer or Indenture Trustee into the Distribution Account, and (B) any Class B Net Swap Payment for such Distribution Date shall be paid to the Class B Swap Counterparty;
(iii) an amount equal to the Noteholder Servicing Fee for such Transfer Date, PLUS the amount of any Noteholder Servicing Fee previously due but not distributed to the Servicer on a prior Transfer Date, shall be distributed to the Servicer;
(iv) on a pari passu basis (A) an amount equal to Class C Monthly Interest for such Distribution Date, PLUS any Class C Deficiency Amount, PLUS the amount of any Class C Additional Interest for such Distribution Date, PLUS the amount of any Class C Additional Interest previously due but not distributed to the Class C Noteholders on a prior Distribution Date shall be deposited by the Servicer or Indenture Trustee into the Distribution Account, and (B) any Class C Net Swap Payment for such Distribution Date and shall be paid to the Class C Counterparty;
(v) an amount equal to the Aggregate Investor Default Amount and any Investor Uncovered Dilution Amount for such Distribution Date shall be treated as a portion of Available Principal Collections for such Distribution Date and, during the Controlled Accumulation Period or the Early Amortization Period, deposited into the Principal Account on the related Transfer Date;
(vi) an amount equal to the sum of the aggregate amount of Investor Charge-Offs and the amount of Reallocated Principal Collections which have not been previously reimbursed pursuant to this SUBSECTION (vi) shall be treated as a portion of Available Principal Collections for such Distribution Date;
(vii) an amount equal to the excess, if any, of the Required Cash Collateral Amount OVER the Available Cash Collateral Amount shall be deposited into the Cash Collateral Account;
(viii) on each Transfer Date from and after the Reserve Account Funding Date, but prior to the date on which the Reserve Account terminates as described in SUBSECTION 4.10(f), an amount up to the excess, if any, of the Required Reserve Account Amount OVER the Available Reserve Account Amount shall be deposited into the Reserve Account;
(ix) an amount equal to the amounts required to be deposited in the Spread Account pursuant to SECTION 4.12(e) shall be deposited into the Spread Account as provided in SECTION 4.12(e);
(x) on a pari passu basis (A) an amount equal to any partial or early termination payments or other additional payments owed to the Class A Counterparty under the Class A Swap shall be paid to the Class A Counterparty, (B) an amount equal to any partial or early termination payments or other additional payments owed to the Class B Counterparty under the Class B Swap shall be paid to the Class B Counterparty and (C) an amount equal to any partial or early termination payments or other additional payments owed to the Class C Counterparty under the Class C Swap shall be paid to the Class C Counterparty;
(xi) an amount equal to any other payments owed to the Class C Noteholders under the Class C Note Purchase Agreement shall be paid to the Class C Noteholders; and
(xii) the balance, if any, will constitute a portion of Excess Finance Charge Collections for such Distribution Date.
(b) On each Transfer Date with respect to the Revolving Period, an amount
equal to the Available Principal Collections for the related Monthly Period
shall be treated as Shared Principal Collections and applied in accordance with
SECTION 8.5 of the Indenture.
(c) On each Transfer Date with respect to the Controlled Accumulation Period or the Early Amortization Period, an amount equal to the Available Principal Collections for the related Monthly Period shall be distributed or deposited in the following order of priority:
(i) during the Controlled Accumulation Period, an amount equal to the Monthly Principal for such Transfer Date shall be deposited into the Principal Accumulation Account;
(ii) during the Early Amortization Period, an amount equal to the Monthly Principal for such Transfer Date shall be deposited into the Distribution Account on such Transfer Date and on each subsequent Transfer Date for payment to the Class A Noteholders on the related Distribution Date until the Class A Note Principal Balance has been paid in full;
(iii) during the Early Amortization Period, after giving effect to the distribution referred to in CLAUSE (ii) above, an amount equal to the Monthly Principal remaining, if any, shall be deposited into the Distribution Account on such Transfer Date and on each subsequent Transfer Date for payment to the Class B Noteholders on the related Distribution Date until the Class B Note Principal Balance has been paid in full;
(iv) during the Early Amortization Period, after giving effect to the distributions referred to in CLAUSES (ii) and (iii) above, an amount equal to the Monthly Principal remaining, if any, shall be deposited into the Distribution Account on such Transfer Date and on each subsequent Transfer Date for payment to the Class C Noteholders on the related Distribution Date until the Class C Note Principal Balance has been paid in full; and
(v) in the case of each of the Controlled Accumulation Period and the Early Amortization Period, the balance of such Available Principal Collections remaining after application in accordance with CLAUSES (i) through (iv) above shall be treated as Shared Principal Collections and applied in accordance with SECTION 8.5 of the Indenture.
(d) On each Distribution Date, the Indenture Trustee shall pay in accordance with SECTION 5.2 to the Class A Noteholders from the Distribution Account, the amount deposited into the Distribution Account pursuant to SECTION 4.4(a)(i) on the preceding Transfer Date, to the Class B Noteholders from the Distribution Account, the amount deposited into the Distribution Account pursuant to SECTION 4.4(a)(ii) and to the Class C Noteholders from the Distribution Account, the amount deposited into the Distribution Account pursuant to SECTION 4.4(a)(iv).
(e) On the earlier to occur of (i) the first Transfer Date with respect to
the Early Amortization Period and (ii) the Transfer Date immediately preceding
the Class A/B Expected Principal Payment Date, the Indenture Trustee, acting in
accordance with instructions from the Servicer, shall withdraw from the
Principal Accumulation Account and deposit into the Distribution Account amounts
necessary to pay first, to the Class A Noteholders, until paid in full, second,
to the Class B Noteholders, until paid in full, and, if the Early Amortization
Period has commenced, any remainder to the Class C Noteholders, the amounts
deposited into the Principal Accumulation Account pursuant to SUBSECTION
4.4(c)(i). On the Class C Expected Principal Payment Date, if the Early
Amortization Period has not commenced, the Indenture Trustee, acting in
accordance with instructions from the Servicer, shall withdraw from the
Principal Accumulation Account and deposit into the Distribution Account for
payment to the Class C Noteholders the amounts deposited into the Principal
Accumulation Account pursuant to SUBSECTION 4.4(c)(i) on the related Transfer
Date. The Indenture Trustee, acting in accordance with the instructions of the
Servicer, shall in accordance with SECTION 5.2 pay from the Distribution Account
to the Class A Noteholders, the Class B Noteholders and the Class C Noteholders,
as applicable, the amounts deposited for the account of such Noteholders into
the Distribution Account pursuant to this SUBSECTION 4.4(e).
Section 4.5 INVESTOR CHARGE-OFFS. On each Determination Date, the Servicer shall calculate the Aggregate Investor Default Amount and any Investor Uncovered Dilution Amount for the related Distribution Date. If, on any Distribution Date, the sum of the Aggregate Investor Default Amount and any Investor Uncovered Dilution Amount for such Distribution Date
exceeds the sum of the amount of Available Finance Charge Collections and the amount withdrawn from the Cash Collateral Account allocated with respect thereto pursuant to SUBSECTION 4.4(a)(v) and 4.11(c), respectively, with respect to such Distribution Date, the Collateral Amount will be reduced (but not below zero) by the amount of such excess (such reduction, an "INVESTOR CHARGE-OFF").
Section 4.6 REALLOCATED PRINCIPAL COLLECTIONS. On each Transfer Date, the Servicer shall apply, or shall instruct the Indenture Trustee in writing to apply, Reallocated Principal Collections with respect to that Transfer Date, to fund any deficiency pursuant to and in the priority set forth in SUBSECTIONS 4.4(a)(i), (ii), (iii) and (iv)(B), after giving effect to any withdrawal from the Cash Collateral Account or the Spread Account to cover such payments. On each Transfer Date, the Collateral Amount shall be reduced by the amount of Reallocated Principal Collections for such Transfer Date.
Section 4.7 EXCESS FINANCE CHARGE COLLECTIONS. Series 2001-A shall be an Excess Allocation Series with respect to Group One only. For this purpose, each outstanding series of certificates issued by World Financial Network Master Trust (other than series represented by the Collateral Certificate) shall be deemed to be a Series in Group One. Subject to SECTION 8.6 of the Indenture, Excess Finance Charge Collections with respect to the Excess Allocation Series in Group One for any Transfer Date will be allocated to Series 2001-A in an amount equal to the product of (x) the aggregate amount of Excess Finance Charge Collections with respect to all the Excess Allocation Series in Group One for such Distribution Date and (y) a fraction, the numerator of which is the Finance Charge Shortfall for Series 2001-A for such Distribution Date and the denominator of which is the aggregate amount of Finance Charge Shortfalls for all the Excess Allocation Series in Group One for such Distribution Date. The "FINANCE CHARGE SHORTFALL" for Series 2001-A for any Distribution Date will be equal to the excess, if any, of (a) the full amount required to be paid, without duplication, pursuant to SUBSECTIONS 4.4(a)(i) through (xi) on such Distribution Date OVER (b) the Available Finance Charge Collections with respect to such Distribution Date (excluding any portion thereof attributable to Excess Finance Charge Collections).
Section 4.8 SHARED PRINCIPAL COLLECTIONS. Subject to SECTION 4.4 of the Pooling and Servicing Agreement and SECTION 8.5 of the Indenture, Shared Principal Collections allocable to Series 2001-A on any Transfer Date will be equal to the product of (x) the aggregate amount of Shared Principal Collections with respect to all Principal Sharing Series for such Transfer Date and (y) a fraction, the numerator of which is the Principal Shortfall for Series 2001-A for such Transfer Date and the denominator of which is the aggregate amount of Principal Shortfalls for all the Series which are Principal Sharing Series for such Transfer Date. For this purpose, each outstanding series of certificates issued by World Financial Network Master Trust (other than series represented by the Collateral Certificate) shall be deemed to be a Principal Sharing Series. The "PRINCIPAL SHORTFALL" for Series 2001-A will be equal to (a) for any Transfer Date with respect to the Revolving Period or the Early Amortization Period, zero, and (b) for any Transfer Date with respect to the Controlled Accumulation Period, the excess, if any, of the Controlled Deposit Amount with respect to such Transfer Date OVER the amount of Available Principal Collections for such Transfer Date (excluding any portion thereof attributable to Shared Principal Collections).
Section 4.9 CERTAIN SERIES ACCOUNTS.
(a) The Indenture Trustee shall establish and maintain with an Eligible Institution, which may be the Indenture Trustee in the name of the Trust, on behalf of the Trust, for the benefit of the Noteholders, four segregated trust accounts with such Eligible Institution (the "FINANCE CHARGE ACCOUNT", the "PRINCIPAL ACCOUNT", the "PRINCIPAL ACCUMULATION ACCOUNT" and the "DISTRIBUTION ACCOUNT"), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2001-A Noteholders. The Indenture Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account and in all proceeds thereof. The Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Series 2001-A Noteholders. If at any time the institution holding the Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account ceases to be an Eligible Institution, the Transferor shall notify the Indenture Trustee in writing, and the Indenture Trustee upon being notified (or the Servicer on its behalf) shall, within ten (10) Business Days, establish a new Finance Charge Account, a new Principal Account, a new Principal Accumulation Account and a new Distribution Account meeting the conditions specified above with an Eligible Institution, and shall transfer any cash or any investments to such new Finance Charge Account, new Principal Account, new Principal Accumulation Account and new Distribution Account. The Indenture Trustee, at the written direction of the Servicer, shall (i) make withdrawals from the Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account from time to time, in the amounts and for the purposes set forth in this Indenture Supplement, and (ii) on each Transfer Date (from and after the commencement of the Controlled Accumulation Period) prior to the termination of the Principal Accumulation Account, make deposits into the Principal Accumulation Account in the amounts specified in, and otherwise in accordance with, SUBSECTION 4.4(c)(i). Indenture Trustee at all times shall maintain accurate records reflecting each transaction in the Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account.
(b) Funds on deposit in the Finance Charge Account, the Principal Account, the Principal Accumulation Account and the Distribution Account, from time to time shall be invested and reinvested at the direction of the Servicer by the Indenture Trustee in Eligible Investments that will mature so that such funds will be available for withdrawal on or prior to the following Transfer Date.
The Indenture Trustee shall hold such of the Eligible Investments as consists of instruments, deposit accounts, negotiable documents, money, goods, letters of credit, and advices of credit in the State of New York and/or Illinois. The Indenture Trustee shall hold such of the Eligible Investments as constitutes investment property through a securities intermediary, which securities intermediary shall agree with the Indenture Trustee that (a) such investment property shall at all times be credited to a securities account of the Indenture Trustee, (b) such securities intermediary shall treat the Indenture Trustee as entitled to exercise the rights that comprise each financial asset credited to such securities account, (c) all property credited to such securities account shall be treated as a financial asset, (d) such securities intermediary shall comply with entitlement orders originated by the Indenture Trustee without the further consent of any other
person or entity, (e) such securities intermediary will not agree with any person or entity other than the Indenture Trustee to comply with entitlement orders originated by such other person or entity, (f) such securities accounts and the property credited thereto shall not be subject to any lien, security interest or right of set-off in favor of such securities intermediary or anyone claiming through it (other than the Indenture Trustee), and (g) such agreement shall be governed by the laws of the State of New York. Terms used in the preceding sentence that are defined in the New York UCC and not otherwise defined herein shall have the meaning set forth in the New York UCC.
On each Transfer Date with respect to the Controlled Accumulation Period and on the first Transfer Date with respect to the Early Amortization Period, the Indenture Trustee, acting at the Servicer's direction given on or before such Transfer Date, shall transfer from the Principal Accumulation Account to the Finance Charge Account the Principal Accumulation Investment Proceeds on deposit in the Principal Accumulation Account for application as Available Finance Charge Collections in accordance with SECTION 4.4.
Principal Accumulation Investment Proceeds (including reinvested interest) shall not be considered part of the amounts on deposit in the Principal Accumulation Account for purposes of this Indenture Supplement.
Section 4.10 RESERVE ACCOUNT.
(a) The Indenture Trustee shall establish and maintain with an Eligible Institution, which may be the Indenture Trustee in the name of the Trust, on behalf of the Trust, for the benefit of the Series 2001-A Noteholders, a segregated trust account (the "RESERVE ACCOUNT"), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2001-A Noteholders. The Indenture Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Reserve Account and in all proceeds thereof. The Reserve Account shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Series 2001-A Noteholders. If at any time the institution holding the Reserve Account ceases to be an Eligible Institution, the Transferor shall notify the Indenture Trustee, and the Indenture Trustee upon being notified (or the Servicer on its behalf) shall, within ten (10) Business Days, establish a new Reserve Account meeting the conditions specified above with an Eligible Institution, and shall transfer any cash or any investments to such new Reserve Account. The Indenture Trustee, at the direction of the Servicer, shall (i) make withdrawals from the Reserve Account from time to time in an amount up to the Available Reserve Account Amount at such time, for the purposes set forth in this Indenture Supplement, and (ii) on each Transfer Date (from and after the Reserve Account Funding Date) prior to termination of the Reserve Account, make a deposit into the Reserve Account in the amount specified in, and otherwise in accordance with, SUBSECTION 4.4(a)(viii).
(b) Funds on deposit in the Reserve Account shall be invested at the written direction of the Servicer by the Indenture Trustee in Eligible Investments. Funds on deposit in the Reserve Account on any Transfer Date, after giving effect to any withdrawals from the Reserve Account on such Transfer Date, shall be invested in such investments that will mature so that such funds will be available for withdrawal on or prior to the following Transfer Date.
The Indenture Trustee shall hold such of the Eligible Investments as consists of instruments, deposit accounts, negotiable documents, money, goods, letters of credit, and advices of credit in the State of New York. The Indenture Trustee shall hold such of the Eligible Investments as constitutes investment property through a securities intermediary, which securities intermediary shall agree with the Indenture Trustee that (a) such investment property shall at all times be credited to a securities account of the Indenture Trustee, (b) such securities intermediary shall treat the Indenture Trustee as entitled to exercise the rights that comprise each financial asset credited to such securities account, (c) all property credited to such securities account shall be treated as a financial asset, (d) such securities intermediary shall comply with entitlement orders originated by the Indenture Trustee without the further consent of any other person or entity, (e) such securities intermediary will not agree with any person or entity other than the Indenture Trustee to comply with entitlement orders originated by such other person or entity, (f) such securities accounts and the property credited thereto shall not be subject to any lien, security interest, or right of set-off in favor of such securities intermediary or anyone claiming through it (other than the Indenture Trustee), and (g) such agreement shall be governed by the laws of the State of New York. Terms used in the preceding sentence that are defined in the New York UCC and not otherwise defined herein shall have the meaning set forth in the New York UCC.
On each Transfer Date, all interest and earnings (net of losses and investment expenses) accrued since the preceding Transfer Date on funds on deposit in the Reserve Account shall be retained in the Reserve Account (to the extent that the Available Reserve Account Amount is less than the Required Reserve Account Amount) and the balance, if any, shall be deposited into the Finance Charge Account and included in Available Finance Charge Collections for such Transfer Date. For purposes of determining the availability of funds or the balance in the Reserve Account for any reason under this Indenture Supplement, except as otherwise provided in the preceding sentence, investment earnings on such funds shall be deemed not to be available or on deposit.
(c) On or before each Transfer Date with respect to the Controlled Accumulation Period and on or before the first Transfer Date with respect to the Early Amortization Period, the Servicer shall calculate the Reserve Draw Amount; PROVIDED, HOWEVER, that such amount will be reduced to the extent that funds otherwise would be available for deposit in the Reserve Account under SECTION 4.4(a)(viii) with respect to such Transfer Date.
(d) If for any Transfer Date the Reserve Draw Amount is greater than zero, the Reserve Draw Amount, up to the Available Reserve Account Amount, shall be withdrawn from the Reserve Account on such Transfer Date by the Indenture Trustee (acting in accordance with the written instructions of the Servicer) and deposited into the Finance Charge Account for application as Available Finance Charge Collections for such Transfer Date.
(e) If the Reserve Account Surplus on any Transfer Date, after giving effect to all deposits to and withdrawals from the Reserve Account with respect to such Transfer Date, is greater than zero, the Indenture Trustee, acting in accordance with the written instructions of the Servicer, shall withdraw from the Reserve Account an amount equal to such Reserve Account Surplus and (i) deposit such amounts in the Spread Account, to the extent that funds on deposit in the Spread Account are less than the Required Spread Account Amount, and (ii) distribute any
such amounts remaining after application pursuant to SUBSECTION 4.10(e)(i) to the holders of the Transferor Interest.
(f) Upon the earliest to occur of (i) the termination of the Trust pursuant to ARTICLE VIII of the Trust Agreement, (ii) the first Transfer Date relating to the Early Amortization Period and (iii) the Transfer Date immediately preceding the Class A/B Expected Principal Payment Date, the Indenture Trustee, acting in accordance with the instructions of the Servicer, after the prior payment of all amounts owing to the Series 2001-A Noteholders that are payable from the Reserve Account as provided herein, shall withdraw from the Reserve Account all amounts, if any, on deposit in the Reserve Account and (i) deposit such amounts in the Spread Account, to the extent that funds on deposit in the Spread Account are less than the Required Spread Account Amount, and (ii) distribute any such amounts remaining after application pursuant to SUBSECTION 4.10(f)(i) to the holders of the Transferor Interest. The Reserve Account shall thereafter be deemed to have terminated for purposes of this Indenture Supplement. Funds on deposit in the Reserve Account at any time that the Controlled Accumulation Period is suspended pursuant to SECTION 4.15 shall remain on deposit until applied in accordance with SUBSECTION 4.10(d), (e) or (f).
Section 4.11 CASH COLLATERAL ACCOUNT.
(a) The Indenture Trustee shall establish and maintain with an Eligible Institution, which may be the Indenture Trustee in the name of the Trust, on behalf of the Trust, for the benefit of the Series 2001-A Noteholders, a segregated trust account (the "CASH COLLATERAL ACCOUNT"), bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Series 2001-A Noteholders. The Indenture Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Cash Collateral Account and in all proceeds thereof. The Cash Collateral Account shall be under the sole dominion and control of the Indenture Trustee for the benefit of the Series 2001-A Noteholders. If at any time the institution holding the Cash Collateral Account ceases to be an Eligible Institution, the Transferor shall notify the Indenture Trustee, and the Indenture Trustee upon being notified (or the Servicer on its behalf) shall, within ten (10) Business Days, establish a new Cash Collateral Account meeting the conditions specified above with an Eligible Institution, and shall transfer any cash or any investments to such new Cash Collateral Account.
(b) On the Closing Date, Transferor shall deposit $22,500,000 in immediately available funds into the Cash Collateral Account. Funds on deposit in the Cash Collateral Account shall be invested at the written direction of the Servicer by the Indenture Trustee in Eligible Investments. Funds on deposit in the Cash Collateral Account on any Transfer Date, after giving effect to any withdrawals from the Cash Collateral Account on such Transfer Date, shall be invested in such investments that will mature so that such funds will be available for withdrawal on or prior to the following Transfer Date.
The Indenture Trustee shall hold such of the Eligible Investments as consists of instruments, deposit accounts, negotiable documents, money, goods, letters of credit, and advices of credit in the State of New York. The Indenture Trustee shall hold such of the Eligible Investments as constitutes investment property through a securities intermediary, which securities intermediary shall agree with the Indenture Trustee that (a) such investment property
shall at all times be credited to a securities account of the Indenture Trustee,
(b) such securities intermediary shall treat the Indenture Trustee as entitled
to exercise the rights that comprise each financial asset credited to such
securities account, (c) all property credited to such securities account shall
be treated as a financial asset, (d) such securities intermediary shall comply
with entitlement orders originated by the Indenture Trustee without the further
consent of any other person or entity, (e) such securities intermediary will not
agree with any person or entity other than the Indenture Trustee to comply with
entitlement orders originated by such other person or entity, (f) such
securities accounts and the property credited thereto shall not be subject to
any lien, security interest, or right of set-off in favor of such securities
intermediary or anyone claiming through it (other than the Indenture Trustee),
and (g) such agreement shall be governed by the laws of the State of New York.
Terms used in the preceding sentence that are defined in the New York UCC and
not otherwise defined herein shall have the meaning set forth in the New York
UCC.
On each Transfer Date, all interest and earnings (net of losses and investment expenses) accrued since the preceding Transfer Date on funds on deposit in the Cash Collateral Account shall be retained in the Cash Collateral Account (to the extent that the Available Cash Collateral Account Amount is less than the Required Cash Collateral Account Amount) and the balance, if any, shall be deposited into the Finance Charge Account and included in Available Finance Charge Collections for such Transfer Date. For purposes of determining the availability of funds or the balance in the Cash Collateral Account for any reason under this Indenture Supplement, except as otherwise provided in the preceding sentence, interest and earnings on such funds shall be deemed not to be available or on deposit.
(c) On each Determination Date, Servicer shall calculate the amount (the
"REQUIRED DRAW AMOUNT") by which the sum of the amounts required to be
distributed pursuant to SECTIONS 4.4(a)(i) through (v) with respect to the
related Transfer Date exceeds the amount of Available Finance Charge Collections
with respect to the related Monthly Period. If the Required Draw Amount for any
Transfer Date is greater than zero, Servicer shall give written notice to the
Indenture Trustee of such positive Required Draw Amount on the related
Determination Date. On the related Transfer Date, the Required Draw Amount, if
any, up to the Available Cash Collateral Amount, shall be withdrawn from the
Cash Collateral Account and distributed to fund any deficiency pursuant to
SECTION 4.4(a)(i) through (v) (in the order of priority set forth in SECTION
4.4(a)).
(d) If, after giving effect to all deposits to and withdrawals from the Cash Collateral Account with respect to any Transfer Date, the amount on deposit in the Cash Collateral Account exceeds the Required Cash Collateral Amount, the Indenture Trustee acting in accordance with the instructions of the Servicer, shall withdraw an amount equal to such excess from the Cash Collateral Account and (i) deposit such amounts in the Spread Account, to the extent that funds on deposit in the Spread Account are less than the Required Spread Account Amount and (ii) distribute such amounts remaining after application pursuant to SUBSECTION 4.11(d) to the Transferor.
Section 4.12 SPREAD ACCOUNT.
(a) On or prior to the Closing Date, the Indenture Trustee shall establish
and maintain with an Eligible Institution, which may be the Indenture Trustee in
the name of the Trust, on behalf of the Trust, for the benefit of the Class C
Noteholders and the Transferor, a segregated account (the "SPREAD ACCOUNT"),
bearing a designation clearly indicating that the funds deposited therein are
held for the benefit of the Class C Noteholders and the Transferor. Except as
otherwise provided in this SECTION 4.12, the Indenture Trustee shall possess all
right, title and interest in all funds on deposit from time to time in the
Spread Account and in all proceeds thereof. The Spread Account shall be under
the sole dominion and control of the Indenture Trustee for the benefit of the
Class C Noteholders and the holder of the Transferor Interest. If at any time
the institution holding the Spread Account ceases to be an Eligible Institution,
the Servicer shall notify the Indenture Trustee in writing, and the Indenture
Trustee upon being notified (or the Servicer on its behalf) shall, within ten
(10) Business Days (or such longer period as to which the Rating Agencies may
consent) establish a new Spread Account meeting the conditions specified above
with an Eligible Institution and shall transfer any cash or any investments to
such new Spread Account. The Indenture Trustee, at the written direction of the
Servicer, shall (i) make withdrawals from the Spread Account from time to time
in an amount up to the Available Spread Account Amount at such time, for the
purposes set forth in this Indenture Supplement, and (ii) on each Transfer Date
prior to termination of the Spread Account, make a deposit into the Spread
Account in the amount specified in, and otherwise in accordance with, SUBSECTION
4.12(e).
(b) Funds on deposit in the Spread Account shall be invested at the written direction of the Servicer by the Indenture Trustee in Eligible Investments. Funds on deposit in the Spread Account on any Transfer Date, after giving effect to any withdrawals from and deposits to the Spread Account on such Transfer Date, shall be invested in such investments that will mature so that such funds will be available for withdrawal on or prior to the following Transfer Date.
The Indenture Trustee shall hold such of the Eligible Investments as consists of instruments, deposit accounts, negotiable documents, money, goods, letters of credit, and advices of credit in the State of New York. The Indenture Trustee shall hold such of the Eligible Investments as constitutes investment property through a securities intermediary, which securities intermediary shall agree with the Indenture Trustee that (a) such investment property shall at all times be credited to a securities account of the Indenture Trustee, (b) such securities intermediary shall treat the Indenture Trustee as entitled to exercise the rights that comprise each financial asset credited to such securities account, (c) all property credited to such securities account shall be treated as a financial asset, (d) such securities intermediary shall comply with entitlement orders originated by the Indenture Trustee without the further consent of any other person or entity, (e) such securities intermediary will not agree with any person or entity other than the Indenture Trustee to comply with entitlement orders originated by such other person or entity, (f) such securities accounts and the property credited thereto shall not be subject to any lien, security interest, or right of set-off in favor of such securities intermediary or anyone claiming through it (other than the Indenture Trustee), and (g) such agreement shall be governed by the laws of the State of New York. Terms used in the preceding sentence that are defined in the New York UCC and not otherwise defined herein shall have the meaning set forth in the New
York UCC. Except as permitted by this SUBSECTION 4.12(b), the Indenture Trustee shall not hold Eligible Investments through an agent or a nominee.
On each Transfer Date (but subject to SUBSECTION 4.12(c)), the Investment Earnings, if any, accrued since the preceding Transfer Date on funds on deposit in the Spread Account shall be paid to the holders of the Transferor Interest by the Indenture Trustee upon written direction of the Servicer. For purposes of determining the availability of funds or the balance in the Spread Account for any reason under this Indenture Supplement (subject to SUBSECTION 4.12(c)), all Investment Earnings shall be deemed not to be available or on deposit; PROVIDED that after the maturity of the Series 2001-A Notes has been accelerated as a result of an Event of Default, all Investment Earnings shall be added to the balance on deposit in the Spread Account and treated like the rest of the Available Spread Account Amount.
(c) If, on any Transfer Date, the aggregate amount of Available Finance Charge Collections and the amount, if any, withdrawn from the Cash Collateral Account available for deposit into the Distribution Account pursuant to SUBSECTION 4.4(a)(iv) and 4.11(c), respectively, is less than the aggregate amount required to be deposited pursuant to SUBSECTION 4.4(a)(iv), the Indenture Trustee, at the written direction of the Servicer, shall withdraw from the Spread Account the amount of such deficiency up to the Available Spread Account Amount and, if the Available Spread Account Amount is less than such deficiency, Investment Earnings credited to the Spread Account, and deposit such amount in the Distribution Account for payment to the Class C Noteholders in respect of interest on the Class C Notes.
(d) On the earlier of Series 2001-A Final Maturity Date and the date on which the Class A Note Principal Balance and the Class B Note Principal Balance have been paid in full, after applying any funds on deposit in the Spread Account as described in SECTION 4.12(c), the Indenture Trustee at the written direction of the Servicer shall withdraw from the Spread Account an amount equal to the lesser of (i) the Class C Note Principal Balance (after any payments to be made pursuant to SUBSECTION 4.4(c) on such date) and (ii) the Available Spread Account Amount and, if the Available Spread Account Amount is not sufficient to reduce the Class C Note Principal Balance to zero, Investment Earnings credited to the Spread Account up to the amount required to reduce the Class C Note Principal Balance to zero, and the Indenture Trustee upon the written direction of the Servicer or the Servicer shall deposit such amounts into the Collection Account for distribution to the Class C Noteholders in accordance with SUBSECTION 5.2(e).
(e) On any day following the occurrence of an Event of Default with respect to Series 2001-A and acceleration of the maturity of the Series 2001-A Notes pursuant to SECTION 5.3 of the Indenture, Servicer shall withdraw from the Spread Account an amount equal to the Available Spread Account Amount and Indenture Trustee or Servicer shall deposit such amounts into the Distribution Account for distribution to the Class C Noteholders, the Class A Noteholders and the Class B Noteholders, in that order of priority, in accordance with SECTION 5.2, to fund any shortfalls in amounts owed to such Noteholders.
(f) If on any Transfer Date, after giving effect to all withdrawals from the Spread Account, the Available Spread Account Amount is less than the Required Spread Account
Amount then in effect, Available Finance Charge Collections shall be deposited into the Spread Account pursuant to SUBSECTION 4.4(a)(ix) up to the amount of the Spread Account Deficiency.
(g) If, after giving effect to all deposits to and withdrawals from the Spread Account with respect to any Transfer Date, the amount on deposit in the Spread Account exceeds the Required Spread Account Amount, the Indenture Trustee acting in accordance with the instructions of the Servicer, shall withdraw an amount equal to such excess from the Spread Account and distribute such amount to the Transferor. On the date on which the Class C Note Principal Balance has been paid in full, after making any payments to the Noteholders required pursuant to SUBSECTIONS 4.12(c), (d) and (e), the Indenture Trustee, at the written direction of Servicer, shall withdraw from the Spread Account all amounts then remaining in the Spread Account and pay such amounts to the holders of the Transferor Interest.
Section 4.13 INVESTMENT INSTRUCTIONS. Any investment instructions required
to be given to the Indenture Trustee pursuant to the terms hereof must be given
to the Indenture Trustee no later than 11:00 a.m., New York City time, on the
date such investment is to be made. In the event the Indenture Trustee receives
such investment instruction later than such time, the Indenture Trustee may, but
shall have no obligation to, make such investment. In the event the Indenture
Trustee is unable to make an investment required in an investment instruction
received by the Indenture Trustee after 11:00 a.m., New York City time, on such
day, such investment shall be made by the Indenture Trustee on the next
succeeding Business Day. In no event shall the Indenture Trustee be liable for
any investment not made pursuant to investment instructions received after 11:00
a.m., New York City time, on the day such investment is requested to be made.
Section 4.14 CONTROLLED ACCUMULATION PERIOD. The Controlled Accumulation Period is scheduled to commence at the beginning of business on August 1, 2003; PROVIDED that if the Controlled Accumulation Period Length (determined as described below) on any Determination Date on or after the July 2003 Determination Date is less than 12 months, upon written notice to the Indenture Trustee, Transferor and, each Rating Agency, Servicer, at its option, may elect to modify the date on which the Controlled Accumulation Period actually commences to the first Business Day of the month that is the number of whole months prior to the month in which the Class A/B Expected Principal Payment Date occurs at least equal to the Controlled Accumulation Period Length (so that, as a result of such election, the number of Monthly Periods in the Controlled Accumulation Period will at least equal the Controlled Accumulation Period Length); PROVIDED that (i) the length of the Controlled Accumulation Period will not be less than two months, (ii) such determination of the Controlled Accumulation Period Length shall be made on each Determination Date on and after the July 2003 Determination Date but prior to the commencement of the Controlled Accumulation Period, and any election to shorten the Controlled Accumulation Period shall be subject to the subsequent lengthening of the Controlled Accumulation Period to the Controlled Accumulation Period Length determined on any subsequent Determination Date, but the Controlled Accumulation Period shall in no event commence prior to the Controlled Accumulation Date, and (iii) notwithstanding any other provision of this Indenture Supplement to the contrary, no election to postpone the commencement of the Controlled Accumulation Period shall be made after an Early Amortization Event shall have occurred and be continuing with respect to any other Series. The "CONTROLLED ACCUMULATION PERIOD LENGTH" will mean a number of whole months such that the
amount available for distribution of principal on the Class A Notes and the
Class B Notes on the Class A/B Expected Payment Date is expected to equal or
exceed the sum of the Class A Note Principal Balance and the Class B Note
Principal Balance, assuming for this purpose that (1) the payment rate with
respect to Principal Collections remains constant at the lowest level of such
payment rate during the twelve preceding Monthly Periods (or such lower payment
rate as Servicer may select), (2) the total amount of Principal Receivables in
the Trust (and the principal amount on deposit in the Excess Funding Account, if
any) remains constant at the level on such date of determination, (3) no Early
Amortization Event with respect to any Series will subsequently occur and (4) no
additional Series (other than any Series being issued on such date of
determination) will be subsequently issued. Any notice by Servicer electing to
modify the commencement of the Controlled Accumulation Period pursuant to this
SECTION 4.14 shall specify (i) the Controlled Accumulation Period Length, (ii)
the commencement date of the Controlled Accumulation Period and (iii) the
Controlled Accumulation Amount with respect to each Monthly Period during the
Controlled Accumulation Period. The Servicer shall calculate the Controlled
Accumulation Period Length on each Determination Date prior to the July 2003
Determination Date as necessary to determine the Reserve Account Funding Date.
Section 4.15 SUSPENSION OF CONTROLLED ACCUMULATION PERIOD. (a) The
Servicer may elect to suspend the commencement of the Controlled Accumulation
Period with prior notice to the Rating Agencies. The commencement of the
Controlled Accumulation Period shall be suspended upon delivery by the Servicer
to the Indenture Trustee of (i) an Officer's Certificate stating that the
Servicer has elected to suspend the commencement of the Controlled Accumulation
Period and that all conditions precedent to such suspension set forth in this
SECTION 4.15 have been satisfied, (ii) a copy of an executed Qualified Maturity
Agreement and (iii) an Opinion of Counsel addressed to the Indenture Trustee as
to the due authorization, execution and delivery and the validity and
enforceability of such Qualified Maturity Agreement. The Issuer does hereby
transfer, assign, set-over, and otherwise convey to the Indenture Trustee for
the benefit of the Series 2001-A Noteholders, without recourse, all of its
rights under any Qualified Maturity Agreement obtained in accordance with this
SECTION 4.15 and all proceeds thereof. Such property shall constitute part of
the Trust Estate for all purposes of the Indenture. The foregoing transfer,
assignment, set-over and conveyance does not constitute and is not intended to
result in a creation or an assumption by the Indenture Trustee or any Noteholder
of any obligation of the Issuer or any other Person in connection with a
Qualified Maturity Agreement or under any agreement or instrument relating
thereto.
The Indenture Trustee hereby acknowledges its acceptance, to the extent validly transferred, assigned, set-over or otherwise conveyed to the Indenture Trustee, for the benefit of the Series 2001-A Noteholders, of all of the rights previously held by the Issuer under any Qualified Maturity Agreement obtained by the Issuer and all proceeds thereof, and declares that it shall hold such rights upon the trust set forth herein and in the Agreement, and subject to the terms hereof and thereof, for the benefit of the Series 2001-A Noteholders.
(b) The Issuer shall cause the provider of each Qualified Maturity Agreement to deposit into the Principal Accumulation Account on or before the Class A/B Expected Principal Payment Date an amount equal to the initial Note Principal Balance (excluding the Class C Note Initial Principal Balance) and a further deposit into the Principal Accumulation Account on the Class C Expected Principal Payment Date in an amount equal to the Class C Note Initial
Principal Balance; PROVIDED, HOWEVER, that the Issuer may instead elect to fund all or a portion of such deposits with the proceeds of the issuance of a new Series or with the Available Principal Collections with respect to such Transfer Date. The amounts so deposited shall be applied on the Class A/B Expected Principal Payment Date and the Class C Expected Principal Payment Date, respectively, pursuant to SUBSECTION 4.4(c) as if the commencement of the Controlled Accumulation Period had not been suspended.
(c) Each Qualified Maturity Agreement shall terminate at the close of business on the Class C Expected Principal Payment Date; PROVIDED, HOWEVER, that the Issuer may terminate a Qualified Maturity Agreement prior to such Distribution Date, with notice to each Rating Agency, if (i) the Available Reserve Account Amount equals the Required Reserve Account Amount and (ii) one of the following events occurs: (A) the Issuer obtains a substitute Qualified Maturity Agreement, (B) the provider of the Qualified Maturity Agreement ceases to qualify as an Eligible Institution and the Issuer is unable to obtain a substitute Qualified Maturity Agreement or (C) an Early Amortization Event occurs. In addition, the Issuer may terminate a Qualified Maturity Agreement prior to the later of (i) the date on which the Controlled Accumulation Period was scheduled to begin, before giving effect to the suspension of the Controlled Accumulation Period, and (ii) the date to which the commencement of the Controlled Accumulation Period may be postponed pursuant to SECTION 4.14 (as determined on the Determination Date preceding the date of such termination), in which case the commencement of the Controlled Accumulation Period shall be determined as if the Issuer had not elected to suspend such commencement; PROVIDED, HOWEVER, that the available Reserve Account Amount equals the Required Reserve Account Amount. In the event that the provider of a Qualified Maturity Agreement ceases to qualify as an Eligible Institution, the Issuer shall use its best efforts to obtain a substitute Qualified Maturity Agreement.
(d) If a Qualified Maturity Agreement is terminated prior to the earlier of the Class C Expected Principal Payment Date and the commencement of the Early Amortization Period and the Issuer does not obtain a substitute Qualified Maturity Agreement, the Controlled Accumulation Period shall commence on the latest of (i) the beginning of business on August 1, 2003, (ii) at the election of the Issuer, the date to which the commencement of the Controlled Accumulation Period may be postponed pursuant to SECTION 4.L4 (as determined on the date of such termination) and (iii) the first day of the Monthly Period following the date of such termination.
Section 4.16 DETERMINATION OF LIBOR.
(a) On each LIBOR Determination Date in respect of a Distribution Period, the Indenture Trustee shall determine LIBOR on the basis of the rate for deposits in United States dollars for a period of the Designated Maturity which appears on Telerate Page 3750 as of 11:00 a.m., London time, on such date. If such rate does not appear on Telerate Page 3750, the rate for that Distribution Period Determination Date shall be determined on the basis of the rates at which deposits in United States dollars are offered by the Reference Banks at approximately 11:00 a.m., London time, on that day to prime banks in the London interbank market for a period of the Designated Maturity. The Indenture Trustee shall request the principal London office of each of the Reference Banks to provide a quotation of its rate. If at least two (2) such quotations are provided, the rate for that Distribution Period shall be the arithmetic mean of the quotations.
If fewer than two (2) quotations are provided as requested, the rate for that Distribution Period will be the arithmetic mean of the rates quoted by major banks in New York City, selected by the Servicer, at approximately 11:00 a.m., New York City time, on that day for loans in United States dollars to leading European banks for a period of the Designated Maturity.
(b) The Class A Note Interest Rate and Class B Note Interest Rate applicable to the then current and the immediately preceding Distribution Periods may be obtained by telephoning the Indenture Trustee at its corporate trust office at (312) 827-8500 or such other telephone number as shall be designated by the Indenture Trustee for such purpose by prior written notice by the Indenture Trustee to each Series 2001-A Noteholder from time to time.
(c) On each LIBOR Determination Date, the Indenture Trustee shall send to the Servicer by facsimile transmission, notification of LIBOR for the following Distribution Period.
Section 4.17 SWAPS. (a) On or prior to the Closing Date, the Issuer shall enter into a Class A Swap with the Class A Counterparty, a Class B Swap with the Class B Counterparty and a Class C Swap with the Class C Counterparty for the benefit of the Class A Noteholders, the Class B Noteholders and the Class C Noteholders, respectively. The aggregate notional amount under the Class A Swap shall, at any time, be equal to the Class A Note Principal Balance at such time. The aggregate notional amount under the Class B Swap shall, at any time, be equal to the Class B Note Principal Balance at such time. The aggregate notional amount under the Class C Swap shall, at any time, be equal to the Class C Note Principal Balance. Net Swap Receipts payable by the Class A Counterparty, the Class B Counterparty or the Class C Counterparty shall be deposited by the Indenture Trustee in the Collection Account on the day received and treated as Available Finance Charge Collections. On any Distribution Date when there shall be a Class A Net Swap Payment, such Class A Net Swap Payment shall be paid as provided in SUBSECTION 4.4(a)(i). On any Distribution Date when there shall be a Class B Net Swap Payment, such Class B Net Swap Payment shall be paid as provided in SUBSECTION 4.4(a)(ii). On any Distribution Date when there shall be a Class C Net Swap Payment, such Class C Net Swap Payment shall be paid as provided in SUBSECTION 4.4(a)(iv). On any Distribution Date when there shall be early termination payments or any other miscellaneous payments payable by the Issuer to the Counterparties, such amounts shall be paid as provided in SUBSECTION 4.4(a)(x).
(b) The Servicer may, upon satisfaction of the Rating Agency Condition, and, when required under the terms of the existing Class A Swap, Class B Swap or Class C Swap, shall obtain a replacement Class A Swap, Class B Swap or Class C Swap, as applicable.
ARTICLE V.
DELIVERY OF SERIES 2001-A NOTES; DISTRIBUTIONS; REPORTS TO SERIES 2001-A
NOTEHOLDERS
Section 5.1 DELIVERY AND PAYMENT FOR THE SERIES 2001-A NOTES.
The Issuer shall execute and issue, and the Indenture Trustee shall authenticate, the Series 2001-A Notes in accordance with SECTION 2.3 of the Indenture. The Indenture Trustee shall deliver the Series 2001-A Notes to or upon the written order of the Trust when so authenticated.
Section 5.2 DISTRIBUTIONS.
(a) On each Distribution Date, the Indenture Trustee shall distribute to each Class A Noteholder of record on the related Record Date (other than as provided in SECTION 11.2 of the Indenture) such Class A Noteholder's PRO RATA share of the amounts on deposit in the Distribution Account that are allocated and available on such Distribution Date and as are payable to the Class A Noteholders pursuant to this Indenture Supplement.
(b) On each Distribution Date, the Indenture Trustee shall distribute to each Class B Noteholder of record on the related Record Date (other than as provided in SECTION 11.2 of the Indenture) such Class B Noteholder's PRO RATA share of the amounts on deposit in the Distribution Account that are allocated and available on such Distribution Date and as are payable to the Class B Noteholders pursuant to this Indenture Supplement.
(c) On each Distribution Date, the Indenture Trustee shall distribute to
each Class C Noteholder of record on the related Record Date (other than as
provided in SECTION 11.2 of the Indenture) such Class C Noteholder's PRO RATA
share of the amounts on deposit in the Distribution Account (including amounts
withdrawn from the Spread Account (at the times and in the amounts specified in
SECTION 4.12)) that are allocated and available on such Distribution Date and as
are payable to the Class C Noteholders pursuant to this Indenture Supplement.
(d) The distributions to be made pursuant to this SECTION 5.2 are subject to the provisions of SECTIONS 2.6, 6.1 and 7.1 of the Transfer and Servicing Agreement, SECTION 11.2 of the Indenture and SECTION 7.1 of this Indenture Supplement.
(e) Except as provided in SECTION 11.2 of the Indenture with respect to a final distribution, distributions to 2001-A Noteholders hereunder shall be made by (i) check mailed to each Series 2001-A Noteholder (at such Noteholder's address as it appears in the Note Register), except that for any Series 2001-A Notes registered in the name of the nominee of a Clearing Agency and for the Class C Notes, such distribution shall be made by wire transfer of immediately available funds and (ii) without presentation or surrender of any Series 2001-A Note or the making of any notation thereon.
Section 5.3 REPORTS AND STATEMENTS TO SERIES 2001-A NOTEHOLDERS.
(a) On each Distribution Date, the Indenture Trustee shall forward to each Series 2001-A Noteholder a statement substantially in the form of EXHIBIT C prepared by the Servicer.
(b) Not later than the second Business Day preceding each Distribution Date, the Servicer shall deliver to the Owner Trustee, the Indenture Trustee and each Rating Agency (i) a statement substantially in the form of EXHIBIT B prepared by the Servicer and (ii) a certificate of an Authorized Officer substantially in the form of EXHIBIT D; PROVIDED that the Servicer may amend the form of EXHIBIT B from time to time, with the prior written consent of the Indenture Trustee.
(c) A copy of each statement or certificate provided pursuant to PARAGRAPH
(a) or (b) may be obtained by any Series 2001-A Noteholder by a request in
writing to the Servicer.
(d) On or before January 31 of each calendar year, beginning with January 31, 2002, the Indenture Trustee shall furnish or cause to be furnished to each Person who at any time during the preceding calendar year was a Series 2001-A Noteholder, a statement prepared by the Servicer containing the information which is required to be contained in the statement to Series 2001-A Noteholders, as set forth in PARAGRAPH (a) above, aggregated for such calendar year or the applicable portion thereof during which such Person was a Series 2001-A Noteholder, together with other information as is required to be provided by an issuer of indebtedness under the Code. Such obligation of the Indenture Trustee shall be deemed to have been satisfied to the extent that substantially comparable information shall be provided by the Servicer pursuant to any requirements of the Code as from time to time in effect.
ARTICLE VI.
SERIES 2001-A EARLY AMORTIZATION EVENTS
Section 6.1 SERIES 2001-A EARLY AMORTIZATION EVENTS. If any one of the following events shall occur with respect to the Series 2001-A Notes:
(a) failure on the part of Transferor or the "Transferor" under the Pooling and Servicing Agreement (i) to make any payment or deposit required to be made by it by the terms of the Pooling and Servicing Agreement, the Collateral Series Supplement, the Transfer and Servicing Agreement, the Indenture or this Indenture Supplement on or before the date occurring five (5) Business Days after the date such payment or deposit is required to be made therein or herein or (ii) duly to observe or perform in any material respect any other of its covenants or agreements set forth in the Transfer and Servicing Agreement, the Pooling and Servicing Agreement, the Indenture or this Indenture Supplement, which failure has a material adverse effect on the Series 2001-A Noteholders and which continues unremedied for a period of sixty (60) days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Transferor by the Indenture Trustee, or to the Transferor and the Indenture Trustee by any Holder of the Series 2001-A Notes;
(b) any representation or warranty made by Transferor or the "Transferor"
under the Pooling and Servicing Agreement, in the Transfer and Servicing
Agreement or the Pooling and Servicing Agreement or any information contained in
a computer file or microfiche list required to be delivered by it pursuant to
SECTION 2.1 or SUBSECTION 2.6(c) of the Transfer and Servicing Agreement or
SECTION 2.1 or SUBSECTION 2.6(c) of the Pooling and Servicing Agreement shall
prove to have been incorrect in any material respect when made or when
delivered, which continues to be incorrect in any material respect for a period
of sixty (60) days after the date on which written notice of such failure,
requiring the same to be remedied, shall have been given to the Transferor by
the Indenture Trustee, or to the Transferor and the Indenture Trustee by any
Holder of the Series 2001-A Notes and as a result of which the interests of the
Series 2001-A Noteholders are materially and adversely affected for such period;
PROVIDED, HOWEVER, that a Series 2001-A Early Amortization Event pursuant to
this SUBSECTION 6.1(b) shall not be deemed to have occurred hereunder if the
Transferor has accepted reassignment of the related Receivable, or all of such
Receivables, if applicable, during such period in accordance with the provisions
of the Transfer and Servicing Agreement or the Pooling and Servicing Agreement;
(c) a failure by Transferor or the "Transferor" under the Pooling and Servicing Agreement to convey Receivables in Additional Accounts or Participations to the Receivables Trust within five (5) Business Days after the day on which it is required to convey such Receivables pursuant to SUBSECTION 2.6(b) of the Transfer and Servicing Agreement or SUBSECTION 2.8(b) of the Pooling and Servicing Agreement, respectively, PROVIDED that such failure shall not give rise to an Early Amortization Event if, prior to the date on which such conveyance was required to be completed, Transferor causes a reduction in the invested amount of any Variable Interest to occur, so that, after giving effect to that reduction (i) the Transferor Amount is not less than the Minimum Transferor Amount (including the Additional Minimum Transferor Amount, if any) and (ii) the sum of the aggregate amount of Principal Receivables plus amounts on deposit in the Excess Funding Account is not less than the Required Principal Balance;
(d) any Servicer Default or any "Servicer Default" under the Pooling and Servicing Agreement shall occur;
(e) the Portfolio Yield averaged over three consecutive Monthly Periods is less than the Base Rate averaged over such period;
(f) the Class A Note Principal Balance or the Class B Note Principal Balance shall not be paid in full on the Class A/B Expected Principal Payment Date or the Class C Note Principal Balance shall not be paid in full on the Class C Expected Principal Payment Date, respectively;
(g) the Class A Counterparty, the Class B Counterparty or the Class C Counterparty shall fail to pay any net amount payable by such Counterparty under the Class A Swap, Class B Swap or the Class C Swap, as applicable, as a result of LIBOR being greater than the Class A Swap Rate, Class B Swap Rate or the Class C Swap Rate, as applicable, and such failure is not cured within five Business Days;
(h) the Class A Swap shall terminate prior to the earlier of the payment in full of the Class A Notes and the Series Termination Date and the Issuer shall fail to enter into a replacement Class A Swap in accordance with SUBSECTION 4.17(b); the Class B Swap shall terminate prior to the earlier of the payment in full of the Class B Notes and the Series Termination Date and the Issuer shall fail to enter into a replacement Class B Swap in accordance with SUBECTION 4.17(b); or the Class C Swap shall terminate prior to the earlier of the payment in full of the Class C Notes and the Series Termination Date and the Issuer shall fail to enter into a replacement Class C Swap in accordance with SUBSECTION 4.17(b);
(i) without limiting the foregoing, the occurrence of an Event of Default with respect to Series 2001-A and acceleration of the maturity of the Series 2001-A Notes pursuant to SECTION 5.3 of the Indenture; or
(j) the occurrence of an Early Amortization Event as defined in the Pooling and Servicing Agreement and specified in SECTION 9.1 of that Agreement;
then, in the case of any event described in SUBSECTION (a), (b) or (d), after the applicable grace period, if any, set forth in such subparagraphs, either the Indenture Trustee or the holders of Series 2001-A Notes evidencing more than 50% of the aggregate unpaid principal amount of
Series 2001-A Notes by notice then given in writing to the Transferor and the
Servicer (and to the Indenture Trustee if given by the Series 2001-A
Noteholders) may declare that a "Series Early Amortization Event" with respect
to Series 2001-A (a "SERIES 2001-A EARLY AMORTIZATION EVENT") has occurred as of
the date of such notice, and, in the case of any event described in SUBSECTION
(c), (e), (f), (g), (h), (i) or (j) a Series 2001-A Early Amortization Event
shall occur without any notice or other action on the part of the Indenture
Trustee or the Series 2001-A Noteholders immediately upon the occurrence of such
event.
ARTICLE VII.
REDEMPTION OF SERIES 2001-A NOTES; FINAL DISTRIBUTIONS; SERIES TERMINATION
Section 7.1 OPTIONAL REDEMPTION OF SERIES 2001-A NOTES; FINAL DISTRIBUTIONS.
(a) On any day occurring on or after the date on which the outstanding
principal balance of the Series 2001-A Notes is reduced to 5% or less of the
initial outstanding principal balance of Series 2001-A Notes, the Servicer shall
have the option to redeem the Series 2001-A Notes, at a purchase price equal to
(i) if such day is a Distribution Date, the Reassignment Amount for such
Distribution Date or (ii) if such day is not a Distribution Date, the
Reassignment Amount for the Distribution Date following such day.
(b) Servicer shall give the Indenture Trustee at least thirty (30) days prior written notice of the date on which Servicer intends to exercise such optional redemption. Not later than 12:00 noon, New York City time, on such day Servicer shall deposit into the Collection Account in immediately available funds the excess of the Reassignment Amount over the amount, if any, on deposit in the Principal Accumulation Account. Such redemption option is subject to payment in full of the Reassignment Amount. Following such deposit into the Collection Account in accordance with the foregoing, the Collateral Amount for Series 2001-A shall be reduced to zero and the Series 2001-A Noteholders shall have no further security interest in the Receivables. The Reassignment Amount shall be distributed as set forth in SUBSECTION 7.1(d).
(c) (i) The amount to be paid by the Transferor with respect to Series 2001-A in connection with a reassignment of Receivables to the Transferor pursuant to SECTION 2.4(e) of the Transfer and Servicing Agreement shall equal the Reassignment Amount for the first Distribution Date following the Monthly Period in which the reassignment obligation arises under the Transfer and Servicing Agreement.
(ii) The amount to be paid by the Transferor with respect to Series 2001-A in connection with a repurchase of the Notes pursuant to SECTION 7.1 of the Transfer and Servicing Agreement shall equal the Reassignment Amount for the Distribution Date of such repurchase.
(d) With respect to (a) the Reassignment Amount deposited into the Distribution Account pursuant to SECTION 7.1 or (b) the proceeds of any sale of Receivables pursuant to SECTION 5.5(a)(iii) of the Indenture with respect to Series 2001-A, the Indenture Trustee shall, in accordance with the written direction of the Servicer, not later than 12:00 noon, New York City time, on the related Distribution Date, make distributions of the following amounts (in the
priority set forth below and, in each case, after giving effect to any deposits and distributions otherwise to be made on such date) in immediately available funds: (i) (x) the Class A Note Principal Balance on such Distribution Date will be distributed to the Class A Noteholders and (y) an amount equal to the sum of (A) Class A Monthly Interest for such Distribution Date, (B) any Class A Deficiency Amount for such Distribution Date and (C) the amount of Class A Additional Interest, if any, for such Distribution Date and any Class A Additional Interest previously due but not distributed to the Class A Noteholders on any prior Distribution Date, will be distributed to the Class A Noteholders, (ii) (x) the Class B Note Principal Balance on such Distribution Date will be distributed to the Class B Noteholders and (y) an amount equal to the sum of (A) Class B Monthly Interest for such Distribution Date, (B) any Class B Deficiency Amount for such Distribution Date and (C) the amount of Class B Additional Interest, if any, for such Distribution Date and any Class B Additional Interest previously due but not distributed to the Class B Noteholders on any prior Distribution Date, will be distributed to the Class B Noteholders, (iii) (x) the Class C Note Principal Balance on such Distribution Date will be distributed to the Class C Noteholders and (y) an amount equal to the sum of (A) Class C Monthly Interest for such Distribution Date, (B) any Class C Deficiency Amount for such Distribution Date, (C) the amount of Class C Additional Interest, if any, for such Distribution Date and any Class C Additional Interest previously due but not distributed to the Class C Noteholders on any prior Distribution Date and (D) any other amounts owed to the Class C Noteholders under the Class C Note Purchase Agreement will be distributed to the Class C Noteholders and (iv) on a pari passu basis, (A) any amounts owed to the Counterparty under the Class A Swap will be paid to the Class A Counterparty and (B) any amounts owed to the Class B Counterparty under the Class B Swap will be paid to the Class B Counterparty and (v) any excess shall be released to the Issuer.
Section 7.2 SERIES TERMINATION.
On the Series 2001-A Final Maturity Date, the unpaid principal amount of the Series 2001-A Notes shall be due and payable, and the right of the Series 2001-A Noteholders to receive payments from the Issuer will be limited solely to the right to receive payments pursuant to SECTION 5.5 of the Indenture.
ARTICLE VIII.
MISCELLANEOUS PROVISIONS
Section 8.1 RATIFICATION OF INDENTURE; AMENDMENTS. As supplemented by this Indenture Supplement, the Indenture is in all respects ratified and confirmed and the Indenture as so supplemented by this Indenture Supplement shall be read, taken and construed as one and the same instrument. This Indenture Supplement may be amended only by a Supplemental Indenture entered in accordance with the terms of SECTION 10.1 or 10.2 of the Indenture. For purposes of the application of SECTION 10.2 to any amendment of this Indenture Supplement, the Series 2001-A Noteholders shall be the only Noteholders whose vote shall be required.
Section 8.2 FORM OF DELIVERY OF THE SERIES 2001-A NOTES. The Class A Notes and the Class B Notes shall be Book-Entry Notes and shall be delivered as Registered Notes as provided in SECTIONS 2.1 and 2.13 of the Indenture. The Class C Notes shall be Definitive Notes and shall
be registered in the Note Register in the name of the initial purchaser of the Class C Notes identified in the Class C Note Purchase Agreement.
Section 8.3 COUNTERPARTS. This Indenture Supplement 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.
Section 8.4 GOVERNING LAW. THIS INDENTURE SUPPLEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 8.5 LIMITATION OF LIABILITY. Notwithstanding any other provision herein or elsewhere, this Agreement has been executed and delivered by Chase Manhattan Bank USA, National Association, not in its individual capacity, but solely in its capacity as Owner Trustee of the Trust, in no event shall Chase Manhattan Bank USA, National Association in its individual capacity have any liability in respect of the representations, warranties, or obligations of the Trust hereunder or under any other document, as to all of which recourse shall be had solely to the assets of the Trust, and for all purposes of this Agreement and each other document, the Owner Trustee (as such or in its individual capacity) shall be subject to, and entitled to the benefits of, the terms and provisions of the Trust Agreement.
Section 8.6 RIGHTS OF THE INDENTURE TRUSTEE. The Indenture Trustee shall have herein the same rights, protections, indemnities and immunities as specified in the Master Indenture.
Section 8.7 ADDITIONAL PROVISIONS. The Additional Minimum Transferor Amount is hereby specified as an additional amount to be considered part of the Minimum Transferor Amount pursuant to CLAUSE (b) of the definition of Minimum Transferor Amount.
Section 8.8 ADDITIONAL REQUIREMENTS FOR REGISTRATION OF AND LIMITATIONS ON TRANSFER AND EXCHANGE OF NOTES. (a) All transfers will be subject to the transfer restrictions set forth on the Notes. (b) The Class C Notes will be subject to limitations on transfer and exchange set forth in the Class C Note Purchase Agreement.
[SIGNATURE PAGE FOLLOWS]
IN WITNESS WHEREOF, the undersigned have caused this Indenture Supplement to be duly executed and delivered by their respective duly authorized officers on the day and year first above written.
WORLD FINANCIAL NETWORK CREDIT
CARD MASTER NOTE TRUST, as Issuer
By: Chase Manhattan Bank USA, National Association, not in its individual capacity, but solely as Owner Trustee
By: /s/ Denis Kelly
-----------------------------------------
Name: Denis Kelly
Title: Assistant Vice President
|
BNY MIDWEST TRUST COMPANY, as Indenture Trustee
By: /s/ Eric Lindahl
-----------------------------------------
Name: Eric Lindahl
Title: Assistant Vice President
|
Acknowledged and Accepted:
WORLD FINANCIAL NETWORK NATIONAL BANK,
as Servicer
By: /s/ Robert P. Armiak
-----------------------------------
Name: Robert P. Armiak
Title: Vice President and Treasurer
|
WFN CREDIT COMPANY, LLC
as Transferor
By: /s/ Robert P. Armiak
-----------------------------------
Name: Robert P. Armiak
Title: Vice President and Treasurer
|
EXHIBIT A-1
FORM OF CLASS A SERIES 2001-A FLOATING RATE ASSET BACKED NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK ("WFNMT"), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION DOCUMENTS.
THE HOLDER OF THIS CLASS A NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS A NOTES AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.
THE HOLDER OF THIS CLASS A NOTE SHALL BE DEEMED TO REPRESENT AND WARRANT
THAT EITHER (I) IT IS NOT ACQUIRING THE NOTE WITH THE PLAN ASSETS OF AN
"EMPLOYEE BENEFIT PLAN" AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), WHICH IS SUBJECT TO TITLE I
OF ERISA, A "PLAN" AS DEFINED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE"), AN ENTITY DEEMED TO HOLD THE PLAN ASSETS OF ANY
OF THE FOREGOING BY REASON OF INVESTMENT BY AN EMPLOYEE BENEFIT PLAN OR PLAN IN
SUCH ENTITY, OR A GOVERNMENTAL PLAN SUBJECT TO APPLICABLE LAW THAT IS
SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR
SECTION 4975 OF THE CODE (EACH SUCH ENTITY A "BENEFIT PLAN"); OR (II) THE
ACQUISITION AND HOLDING OF THE CLASS A NOTE WILL NOT GIVE RISE TO A NON-EXEMPT
PROHIBITED TRANSACTION UNDER
Exhibit A-1 (Page 1)
SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE (OR, IN THE CASE OF A GOVERNMENTAL PLAN, ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW).
Exhibit A-1 (Page 2)
REGISTERED $______________ *
No. R-_______ CUSIP NO. _______
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES 2001-A
|
CLASS A SERIES 2001-A FLOATING RATE ASSET BACKED NOTE
World Financial Network Credit Card Master Note Trust (herein referred to as the "Issuer" or the "Trust"), a Delaware statutory business trust governed by an Amended and Restated Trust Agreement dated as of August 1, 2001, for value received, hereby promises to pay to Cede & Co., or registered assigns, subject to the following provisions, the principal sum of DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the June 2008 Distribution Date, except as otherwise provided below or in the Indenture. The Issuer will pay interest on the unpaid principal amount of this Note at the Class A Note Interest Rate on each Distribution Date until the principal amount of this Note is paid in full. Interest on this Note will accrue for each Distribution Date from and including the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, for the initial Distribution Date, from and including the Closing Date to but excluding such Distribution Date. Interest will be computed on the basis of a 360-day year and the actual number of days elapsed. Principal of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.
The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.
Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.
Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture or the Indenture Supplement referred to on the reverse hereof, or be valid for any purpose.
Exhibit A-1 (Page 3)
IN WITNESS WHEREOF, the Issuer has caused this Class A Note to be duly executed.
WORLD FINANCIAL NETWORK CREDIT
CARD MASTER NOTE TRUST,
as Issuer
By: Chase Manhattan Bank USA, National
Association, not in its individual capacity
but solely as Owner Trustee under the
Trust Agreement
By:_________________________________________
Name:
Title:
Dated:________________, 200[_]
Exhibit A-1 (Page 4)
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class A Notes described in the within-mentioned Indenture.
BNY MIDWEST TRUST COMPANY, as
Indenture Trustee
By:________________________________________
Authorized Signatory
Dated: ____________________________________
Exhibit A-1 (Page 5)
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES 2001-A
CLASS A SERIES 2001-A FLOATING RATE ASSET BACKED NOTE
Summary of Terms and Conditions
This Class A Note is one of a duly authorized issue of Notes of the Issuer, designated as World Financial Network Credit Card Master Note Trust, Series 2001-A (the "SERIES 2001-A NOTES"), issued under a Master Indenture dated as of August 1, 2001 (the "MASTER INDENTURE"), between the Issuer and BNY Midwest Trust Company, as indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the Indenture Supplement dated as of August 21, 2001 (the "INDENTURE SUPPLEMENT"), and representing the right to receive certain payments from the Issuer. The term "Indenture," unless the context otherwise requires, refers to the Master Indenture as supplemented by the Indenture Supplement. The Notes are subject to all of the terms of the Indenture. All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture. In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall control.
The Class B Notes and the Class C Notes will also be issued under the Indenture.
The Noteholder, by its acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject to any liability under the Indenture.
This Note does not purport to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.
THIS CLASS A NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, THE ISSUER, WORLD FINANCIAL NETWORK NATIONAL BANK, WFN CREDIT COMPANY, LLC, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
The Issuer, the Transferor, the Indenture Trustee and any agent of the Issuer, the Transferor or the Indenture Trustee shall treat the person in whose name this Class A Note is registered as the owner hereof for all purposes, and neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be affected by notice to the contrary.
THIS CLASS A NOTE 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
Exhibit A-1 (Page 6)
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Exhibit A-1 (Page 7)
ASSIGNMENT
Social Security or other identifying number of assignee _______________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto ___________________________ (name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints ___________________________ attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.
Dated:___________________________ _________________________________**
Signature Guaranteed:
----------
|
** The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.
Exhibit A-1 (Page 8)
EXHIBIT A-2
FORM OF CLASS B SERIES 2001-A FLOATING RATE ASSET BACKED NOTE
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK ("WFNMT"), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION DOCUMENTS.
THE HOLDER OF THIS CLASS B NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS B NOTES AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.
THE HOLDER OF THIS CLASS B NOTE SHALL BE DEEMED TO REPRESENT AND WARRANT
THAT EITHER (I) IT IS NOT ACQUIRING THE NOTE WITH THE PLAN ASSETS OF AN
"EMPLOYEE BENEFIT PLAN" AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), WHICH IS SUBJECT TO TITLE I
OF ERISA, A "PLAN" AS DEFINED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE"), AN ENTITY DEEMED TO HOLD THE PLAN ASSETS OF ANY
OF THE FOREGOING BY REASON OF INVESTMENT BY AN EMPLOYEE BENEFIT PLAN OR PLAN IN
SUCH ENTITY, OR A GOVERNMENTAL PLAN SUBJECT TO APPLICABLE LAW THAT IS
SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR
SECTION 4975 OF THE CODE (EACH SUCH ENTITY A "BENEFIT PLAN"); OR (II) THE
ACQUISITION AND HOLDING OF THE CLASS B NOTE
Exhibit A-2 (Page 1)
WILL NOT GIVE RISE TO A NON-EXEMPT PROHIBITED TRANSACTION UNDER SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE (OR, IN THE CASE OF A GOVERNMENTAL PLAN, ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW).
Exhibit A-2 (Page 2)
REGISTERED $______________ *
No. R-_______ CUSIP NO. _______
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES 2001-A
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CLASS B SERIES 2001-A FLOATING RATE ASSET BACKED NOTE
World Financial Network Credit Card Master Note Trust (herein referred to as the "Issuer" or the "Trust"), a Delaware statutory business trust governed by an Amended and Restated Trust Agreement dated as of August 1, 2001, for value received, hereby promises to pay to Cede & Co., or registered assigns, subject to the following provisions, the principal sum of _______ DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the June 2008 Distribution Date, except as otherwise provided below or in the Indenture. The Issuer will pay interest on the unpaid principal amount of this Note at the Class B Note Interest Rate on each Distribution Date until the principal amount of this Note is paid in full. Interest on this Note will accrue for each Distribution Date from and including the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, for the initial Distribution Date, from and including the Closing Date to but excluding such Distribution Date. Interest will be computed on the basis of a 360-day year and the actual number of days elapsed. Principal of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.
The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.
Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.
Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture or the Indenture Supplement referred to on the reverse hereof, or be valid for any purpose.
THIS CLASS B NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS
ON THE CLASS A NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.
Exhibit A-2 (Page 3)
IN WITNESS WHEREOF, the Issuer has caused this Class B Note to be duly executed.
WORLD FINANCIAL NETWORK CREDIT
CARD MASTER NOTE TRUST,
as Issuer
By: Chase Manhattan Bank USA, National
Association, not in its individual capacity
but solely as Owner Trustee under the Trust
Agreement
By:________________________________________
Name:
Title:
Dated: ________________, 20[__]
Exhibit A-2 (Page 4)
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class B Notes described in the within-mentioned Indenture.
BNY MIDWEST TRUST COMPANY,
as Indenture Trustee
By:_______________________________________
Authorized Signatory
Dated: ___________________________________
Exhibit A-2 (Page 5)
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES 2001-
CLASS B SERIES 2001-A FLOATING RATE ASSET BACKED NOTE
Summary of Terms and Conditions
This Class B Note is one of a duly authorized issue of Notes of the Issuer, designated as World Financial Network Credit Card Master Note Trust, Series 2001-A (the "SERIES 2001-A NOTES"), issued under a Master Indenture dated as of August 1, 2001 (the "MASTER INDENTURE"), between the Issuer and BNY Midwest Trust Company, as indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the Indenture Supplement dated as of August 21, 2001 (the "INDENTURE SUPPLEMENT"), and representing the right to receive certain payments from the Issuer. The term "Indenture," unless the context otherwise requires, refers to the Master Indenture as supplemented by the Indenture Supplement. The Notes are subject to all of the terms of the Indenture. All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture. In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall control.
The Class A Notes and the Class C Notes will also be issued under the Indenture.
The Noteholder, by its acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject to any liability under the Indenture.
This Note does not purport to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.
THIS CLASS B NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, THE ISSUER, WORLD FINANCIAL NETWORK NATIONAL BANK, WFN CREDIT COMPANY, LLC, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
The Issuer, the Transferor, the Indenture Trustee and any agent of the Issuer, the Transferor or the Indenture Trustee shall treat the person in whose name this Class B Note is registered as the owner hereof for all purposes, and neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be affected by notice to the contrary.
THIS CLASS B NOTE 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
Exhibit A-2 (Page 6)
PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Exhibit A-2 (Page 7)
ASSIGNMENT
Social Security or other identifying number of assignee _______________.
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto _______________ (name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints _______________ attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.
Dated:________________________, _________________________________**
Signature Guaranteed:
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** The signature to this assigment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.
Exhibit A-2 (Page 8)
EXHIBIT A-3
FORM OF CLASS C SERIES 2001-A FLOATING RATE ASSET BACKED NOTE
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), IN RELIANCE UPON EXEMPTIONS PROVIDED BY THE SECURITIES ACT. NO RESALE OR OTHER TRANSFER OF THIS NOTE MAY BE MADE EXCEPT IN COMPLIANCE WITH THE REGISTRATION PROVISIONS OF THE SECURITIES ACT AND ANY APPLICABLE PROVISIONS UNDER STATE BLUE SKY OR SECURITIES LAWS OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH PROVISIONS. THE TRANSFER OF THIS NOTE IS SUBJECT TO CERTAIN CONDITIONS SET FORTH IN A NOTE PURCHASE AGREEMENT RELATING HERETO.
THE HOLDER OF THIS NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME INSTITUTE AGAINST WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST, A COMMON LAW TRUST ORGANIZED UNDER THE LAWS OF NEW YORK ("WFNMT"), THE TRANSFEROR OR THE ISSUER, OR SOLICIT OR JOIN OR COOPERATE WITH OR ENCOURAGE OR ENCOURAGE ANY INSTITUTION IN INSTITUTING AGAINST WFNMT, THE TRANSFEROR OR THE ISSUER, ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDINGS, OR OTHER PROCEEDINGS UNDER ANY UNITED STATES FEDERAL OR STATE BANKRUPTCY OR SIMILAR LAW IN CONNECTION WITH ANY OBLIGATION RELATING TO THE NOTES, THE INDENTURE OR ANY OF THE TRANSACTION DOCUMENTS.
THE HOLDER OF THIS CLASS C NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS C NOTES AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.
THE HOLDER OF THIS CLASS C NOTE SHALL BE DEEMED TO REPRESENT AND WARRANT
THAT EITHER (I) IT IS NOT ACQUIRING THE NOTE WITH THE PLAN ASSETS OF AN
"EMPLOYEE BENEFIT PLAN" AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT
INCOME SECURITY ACT OF 1974, AS AMENDED ("ERISA"), WHICH IS SUBJECT TO TITLE I
OF ERISA, A "PLAN" AS DEFINED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF
1986, AS AMENDED (THE "CODE"), AN ENTITY DEEMED TO HOLD THE PLAN ASSETS OF ANY
OF THE FOREGOING BY REASON OF INVESTMENT BY AN EMPLOYEE BENEFIT PLAN OR PLAN IN
SUCH ENTITY, OR A GOVERNMENTAL PLAN SUBJECT TO APPLICABLE LAW THAT IS
SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR
SECTION 4975 OF THE CODE (EACH SUCH ENTITY A "BENEFIT PLAN"); OR (II) THE
ACQUISITION AND HOLDING OF THE CLASS C NOTE WILL NOT GIVE RISE TO A NON-EXEMPT
PROHIBITED TRANSACTION UNDER
Exhibit A-3 (Page 1)
SECTION 406 OF ERISA OR SECTION 4975 OF THE CODE (OR, IN THE CASE OF A GOVERNMENTAL PLAN, ANY SUBSTANTIALLY SIMILAR APPLICABLE LAW).
Exhibit A-3 (Page 2)
REGISTERED $______________ *
No. R-_______
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES 2001-A
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CLASS C SERIES 2001-A FLOATING RATE ASSET BACKED NOTE
World Financial Network Credit Card Master Note Trust (herein referred to as the "Issuer" or the "Trust"), a Delaware statutory business trust governed by an Amended and Restated Trust Agreement dated as of August 1, 2001, for value received, hereby promises to pay to ______________., or registered assigns, subject to the following provisions, the principal sum of ______________ DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the June 2008 Distribution Date, except as otherwise provided below or in the Indenture. The Issuer will pay interest on the unpaid principal amount of this Note at the Class C Note Interest Rate on each Distribution Date until the principal amount of this Note is paid in full. Interest on this Note will accrue for each Distribution Date from and including the most recent Distribution Date on which interest has been paid to but excluding such Distribution Date or, for the initial Distribution Date, from and including the Closing Date to but excluding such Distribution Date. Interest will be computed on the basis of a 360-day year and the actual number of days elapsed. Principal of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.
The principal of and interest on this Note are payable in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts.
Reference is made to the further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on the face of this Note.
Unless the certificate of authentication hereon has been executed by or on behalf of the Indenture Trustee, by manual signature, this Note shall not be entitled to any benefit under the Indenture or the Indenture Supplement referred to on the reverse hereof, or be valid for any purpose.
THIS CLASS C NOTE IS SUBORDINATED TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A AND CLASS B NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.
Exhibit A-3 (Page 3)
IN WITNESS WHEREOF, the Issuer has caused this Class C Note to be duly executed.
WORLD FINANCIAL NETWORK CREDIT
CARD MASTER NOTE TRUST,
as Issuer
By: Chase Manhattan Bank USA, National
Association, not in its individual capacity
but solely as Owner Trustee under the Trust
Agreement
By:________________________________________
Name:
Title:
Dated: _______________________, ____
Exhibit A-3 (Page 4)
INDENTURE TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Class C Notes described in the within-mentioned Indenture.
BNY MIDWEST TRUST COMPANY,
as Indenture Trustee
By:________________________________________
Authorized Signatory
Dated: ____________________________________
Exhibit A-3 (Page 5)
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST SERIES 2001-A
CLASS C SERIES 2001-A FLOATING RATE ASSET BACKED NOTE
Summary of Terms and Conditions
This Class C Note is one of a duly authorized issue of Notes of the Issuer, designated as World Financial Network Credit Card Master Note Trust, Series 2001-A (the "SERIES 2001-A NOTES"), issued under a Master Indenture dated as of August 1, 2001 (the "MASTER INDENTURE"), between the Issuer and BNY Midwest Trust Company, as indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the Indenture Supplement dated as of August 21, 2001 (the "INDENTURE SUPPLEMENT"), and representing the right to receive certain payments from the Issuer. The term "Indenture," unless the context otherwise requires, refers to the Master Indenture as supplemented by the Indenture Supplement. The Notes are subject to all of the terms of the Indenture. All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or pursuant to the Indenture. In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall control.
The Class A Notes and the Class B Notes will also be issued under the Indenture.
The Noteholder, by its acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject to any liability under the Indenture.
This Note does not purport to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits, obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.
THIS CLASS C NOTE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, THE ISSUER, WORLD FINANCIAL NETWORK NATIONAL BANK, WFN CREDIT COMPANY LLC, OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY.
The Issuer, the Transferor, the Indenture Trustee and any agent of the Issuer, the Transferor or the Indenture Trustee shall treat the person in whose name this Class C Note is registered as the owner hereof for all purposes, and neither the Issuer, the Transferor, the Indenture Trustee nor any agent of the Issuer, the Transferor or the Indenture Trustee shall be affected by notice to the contrary.
THIS CLASS C NOTE 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.
Exhibit A-3 (Page 6)
ASSIGNMENT
Social Security or other identifying number of assignee _______________________
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers unto _______________________ (name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints _______________________ attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.
Dated: _______________________, ____ _________________________________**
Signature Guaranteed:
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** The signature to this assignment must correspond with the name of the registered owner as it appears on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.
Exhibit A-3 (Page 7)
EXHIBIT B
FORM OF MONTHLY PAYMENT INSTRUCTIONS AND
NOTIFICATION TO INDENTURE TRUSTEE
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A
The undersigned, a duly authorized representative of World Financial Network National Bank ("WFN"), as Servicer pursuant to the Transfer and Servicing Agreement, dated as of August 1, 2001 (the "TRANSFER AND SERVICING AGREEMENT") between WFN, as Servicer, WFN Credit Company, LLC, as transferor (the "TRANSFEROR") and World Financial Network Credit Card Master Note Trust, as issuer (the "ISSUER"), does hereby certify as follows:
A. Capitalized terms used in this Certificate have their respective meanings set forth in the Master Indenture dated as of August 1, 2001 (the "INDENTURE") between the Issuer and BNY Midwest Trust Company, as indenture trustee (the "INDENTURE Trustee") as supplemented by the 2001-A Indenture Supplement dated as of August 21, 2001 between the Issuer and Indenture Trustee (as amended and supplemented, the "INDENTURE SUPPLEMENT").
B. WFN is the Servicer.
C. The undersigned is an Authorized Officer of the Servicer.
I. INSTRUCTION TO MAKE A WITHDRAWAL
Pursuant to SECTION 4.4, the Servicer does hereby instruct the Indenture Trustee (i) to make a withdrawal from the Distribution Account (or other Series Account as specified below) on ____________, 200_, which date is a Distribution Date under the Indenture Supplement, in an aggregate amount (equal to the Available Finance Charge Collections) as set forth below in respect of the following amounts and (ii) to apply the proceeds of such withdrawal in accordance with SECTION 4.4(a):
A. Pursuant to SUBSECTION 4.4(a)(i):
Class A Monthly Interest for the
preceding Interest Period ................. $_______________________
Monthly Interest previously due but not
distributed to Class A Noteholders ........ $_______________________
Additional Interest previously due but
not distributed to Class A Noteholders .... $_______________________
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Exhibit B-1 (Page 1)
Class A Net Swap Payment .................. $_______________________
B. Pursuant to SUBSECTION 4.4(a)(ii):
Class B Monthly Interest for the
preceding Interest Period ................. $_______________________
Monthly Interest previously due but not
distributed to Class B Noteholders ........ $_______________________
Additional Interest previously due but
not distributed to Class B Noteholders .... $_______________________
Class B Net Swap Payment .................. $_______________________
C. Pursuant to SUBSECTION 4.4(a)(iii):
Noteholder Servicing Fee for such
Distribution Date, PLUS the amount of
any Noteholder Servicing Fee previously
due but not distributed to the Servicer
on a prior Distribution Date .............. $_______________________
D. Pursuant to SUBSECTION 4.4(a)(iv):
Class C Monthly Interest for the
preceding Interest Period ................. $_______________________
Monthly Interest previously due but not
distributed to Class C Noteholders ........ $_______________________
Additional Interest previously due but
not distributed to Class C Noteholders .... $_______________________
Class C Net Swap Payment .................. $_______________________
Pursuant to SUBSECTION 4.4(a)(v) from
E. the Principal Account:
Investor Default Amount to be treated
as Available Principal Collections ........ $_______________________
Investor Uncovered Dilution Amount for
such Distribution Date to be treated
as Available Principal Collections ........ $_______________________
F. Pursuant to SUBSECTION 4.4(a)(vi):
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Exhibit B-1 (Page 2)
Investor Charge Offs and the amount of
Reallocated Principal Collections not
previously reimbursed to be treated as
Available Principal Collections ........... $_______________________
G. Pursuant to SUBSECTION 4.4(a)(vii):
Amount to be deposited into the Cash
Collateral Account ........................ $_______________________
H. Pursuant to SUBSECTION 4.4(a)(viii):
Amount to be deposited into the
Reserve Account ........................... $_______________________
I. Pursuant to SUBSECTION 4.4(a)(ix):
Amount to be deposited
in the Spread Account ..................... $_______________________
J. Pursuant to SUBSECTION 4.4(a)(x):
Early termination payments or other
additional payments owed to be paid to
the Class A Counterparty .................. $_______________________
Early termination payments or other
additional payments owed to be paid to
the Class B Counterparty .................. $_______________________
Early termination payments or other
additional payments owed to be paid to
the Class C Counterparty .................. $_______________________
K. Pursuant to SUBSECTION 4.4(a)(xi):
Additional amounts to be paid to the
Class C Noteholders ....................... $_______________________
L. Pursuant to SUBSECTION 4.4(a)(xii):
The balance will constitute Excess
Finance Charge Collections for such
Distribution Date ......................... $_______________________
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Pursuant to SECTION 4.4(b) and (c), the Servicer does hereby instruct the Indenture Trustee (i) to make a withdrawal from the Distribution Account (or other Series Account specified below) on ____________, 200_, which date is a Distribution Date under the Indenture
Exhibit B-1 (Page 3)
Supplement, in an aggregate amount (equal to the Available Principal Collections) as set forth below in respect of the following amounts and (ii) to apply the proceeds of such withdrawal in accordance with SECTION 4.4(b) and (c):
A. Pursuant to SUBSECTION 4.4(b):
During the Revolving Period, amount equal to the
Available Principal Collections to be treated as Shared
Principal Collections and applied in accordance with
SECTION 8.5 of the Indenture. .........................$____________
B. Pursuant to SUBSECTION 4.4(c)(i):
During the Controlled Accumulation Period, Monthly Principal for such Distribution Date to be deposited into the Principal Accumulation Account. ..............$____________
C. Pursuant to SUBSECTION 4.4(c)(ii):
During the Early Amortization Period, Monthly Principal for such Distribution Date for payment to the Class A Noteholders on such Distribution Date until the Class A Note Principal Balance has been paid in full. .........$____________
D. Pursuant to SUBSECTION 4.4(c)(iii):
During the Early Amortization Period, after giving effect to Clause (C) above, if any remaining Monthly Principal, to the Class B Noteholders on such Distribution Date until the Class B Note Principal Balance has been paid in full. ........................$____________
E. Pursuant to SUBSECTION 4.4(c)(iv):
During the Early Amortization Period, after giving effect to Clause (D) above, if any remaining Monthly Principal, to the Class C Noteholders, on such Distribution Date until the Class C Note Principal Balance has been paid in full. ........................$____________
F. Pursuant to SUBSECTION 4.4(c)(v):
Exhibit B-1 (Page 4)
Amount, if any, remaining after giving effect to Clauses (B) through (E) above, to be treated as Shared Principal Collections. ..........................................$____________
Pursuant to SECTION 4.6, the Servicer does hereby instruct the Indenture Trustee (i) to make a withdrawal from the Distribution Account on ____________, 200_, which date is a Distribution Date under the Indenture Supplement, in an aggregate amount (equal to the Available Principal Collections) as set forth below in respect of the following amounts and (ii) to apply the proceeds of such withdrawal in accordance with SECTION 4.6:
Reallocated Principal Collections to fund any deficiency pursuant to and in the priority set forth SUBSECTIONS 4.4(a)(i), (ii), (iii) and (iv) of the Indenture Supplement. ...........................................$____________
Pursuant to SECTION 4.9, the Servicer does hereby instruct the Indenture Trustee to transfer from the Principal Accumulation Account to the Collection Account, the Principal Accumulation Investment Proceeds on deposit in the Principal Accumulation Account for application as Available Finance Charge Collections in the following amount.
...................................................................$____________
Pursuant to SECTION 4.10, the Servicer does hereby instruct the Indenture Trustee to withdraw from the Reserve Account an amount equal to any Reserve Account Surplus to be deposited into the Spread Account in accordance with SECTION 4.10(E), in the following amount.
...................................................................$____________
Pursuant to SECTION 4.12, the Servicer does hereby instruct the Indenture Trustee to withdraw from the Spread Account an amount equal to a deficiency in Class C Monthly Interest up to the Available Spread Account Amount, in the following amount.
...................................................................$____________
II. INSTRUCTIONS TO MAKE CERTAIN PAYMENTS
Pursuant to SECTION 5.2, the Servicer does hereby instruct the Indenture Trustee or the Paying Agent as the case may be, to pay in accordance with SECTION 5.2 from the Collection Account or the Principal Funding Account, as applicable, on _______________, which date is a Distribution Date under the Indenture Supplement, the following amounts:
A. Pursuant to SUBSECTION 5.2(a):
(1) Class A Noteholder's PRO RATA share of the amounts on deposit in the Distribution Account that are allocated and available on ......................................$____________
Exhibit B-1 (Page 5)
such Distribution Date to pay interest on the Class A Notes pursuant to the Indenture Supplement. ...........$____________
(2) Class A Noteholder's PRO RATA share of the amounts on deposit in the Distribution Account that are allocated and available on such Distribution Date to pay principal of the Class A Notes pursuant to the Indenture Supplement. ...........................................$____________
B. Pursuant to SUBSECTION 5.2(b):
(1) Class B Noteholder's PRO RATA share of the amounts on deposit in the Distribution Account that are allocated and available on such Distribution Date to pay interest on the Class B Notes pursuant to the Indenture Supplement. ...........................................$____________
(2) Class B Noteholder's PRO RATA share of the amounts on deposit in the Distribution Account that are allocated and available on such Distribution Date to pay principal of the Class B Notes pursuant to the Indenture Supplement. ...........................................$____________
C. Pursuant to SUBSECTION 5.2(c):
(1) Class C Noteholder's PRO RATA share of the amounts on deposit in the Distribution Account that are allocated and available on such Distribution Date to pay interest of the Class C Notes pursuant to the Indenture Supplement, including amounts withdrawn from the Spread Account. ..............................................$____________
(2) Class C Noteholder's PRO RATA share of the amounts on deposit in the Distribution Account that are allocated and available on such Distribution Date to pay principal on the Class C Notes pursuant to the Indenture Supplement. ...........................................$____________
Exhibit B-1 (Page 6)
IN WITNESS WHEREOF, the undersigned has duly executed this certificate this ___________ day of ________________, 2000_.
WORLD FINANCIAL NETWORK NATIONAL
BANK, as Servicer
By:_____________________________
Name:
Title:
EXHIBIT C
FORM OF MONTHLY NOTEHOLDERS' STATEMENT
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A
Pursuant to the Master Indenture, dated as of 2001-A, (as amended and supplemented, the "INDENTURE") between World Financial Network Credit Card Master Note Trust (the "ISSUER") and BNY Midwest Trust Company, as indenture trustee (the "INDENTURE TRUSTEE"), as supplemented by the Series 2001-A Indenture Supplement (the "INDENTURE SUPPLEMENT"), dated as of 2001-A, between the Issuer and the Indenture Trustee, World Financial Network National Bank, as Servicer (the "SERVICER") under the Transfer and Servicing Agreement, dated as of 2001-A (the "TRANSFER AND SERVICING AGREEMENT") between the Servicer, WFN Credit Company, as LLC, as Transferor and the Issuer is required to prepare certain information each month regarding current distributions to the Series 2001-A Noteholders and the performance of the Trust during the previous month. The information required to be prepared with respect to the Distribution Date of _________________, and with respect to the performance of the Trust during the month of ________ is set forth below. Capitalized terms used herein are defined in the Indenture and the Indenture Supplement.
A. Information regarding distributions in respect of the Notes
1. The total amount of the distribution in respect of
Class A Notes. ........................................$____________
2. The amount of the distribution set forth in
paragraph 1 above in respect of principal of the
Class A Notes. ........................................$____________
3. The amount of the distribution set forth in
paragraph 1 above in respect of interest on the
Class A Notes. ........................................$____________
4. The total amount of the distribution in respect of
Class B Notes. ........................................$____________
5. The amount of the distribution set forth in
paragraph 4 above in respect of principal of the
Class B Notes. ........................................$____________
6. The amount of the distribution set forth in
paragraph 4 above in respect of interest on the
Class B Notes. ........................................$____________
7. The total amount of the distribution in respect of
Class C Notes. ........................................$____________
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Exhibit C-1 (Page 1)
8. The amount of the distribution set forth in paragraph 7 above in respect of principal of the Class C Notes. ........................................$____________
9. The amount of the distribution set forth in paragraph 7 above in respect of interest on the Class C Notes. ........................................$____________
RECEIVABLES -
Beginning of the Month Principal Receivables: $____________ Beginning of the Month Finance Charge Receivables: $____________ Beginning of the Month Discount Option Receivables: $____________ Beginning of the Month Total Receivables: $____________ Removed Principal Receivables: $____________ Removed Finance Charge Receivables: $____________ Removed Total Receivables: $____________ Additional Principal Receivables: $____________ Additional Finance Charge Receivables: $____________ Additional Total Receivables: $____________ Discount Option Receivables Generated this Period: $____________ Net Recoveries for month of __________ 200_ $____________ End of the Month Principal Receivables: $____________ End of the Month Finance Charge Receivables: $____________ End of the Month Discount Option Receivables: $____________ |
Exhibit C-1 (Page 2)
End of the Month Total Receivables: $____________
Excess Funding Account Balance: $____________
Aggregate Principal Balance: $____________
Minimum Aggregate Principal Balance: $____________
End of the Month Transferor Amount: $____________
Minimum Transferor Amount: $____________
DELINQUENCIES AND LOSSES -
End of the Month Delinquencies: RECEIVABLES
30-59 Days Delinquent $____________
60-89 Days Delinquent $____________
90+ Days Delinquent $____________
Total 30+ Days Delinquent $____________
Defaulted Receivables During the Month $____________
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NOTE PRINCIPAL BALANCES -
Class A Note Principal Balance $____________
Class B Note Principal Balance $____________
Class C Note Principal Balance $____________
SERIES 2001-A
ALLOCATION PERCENTAGE ____________%
AVAILABLE FINANCE CHARGE COLLECTIONS $____________
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Exhibit C-1 (Page 3)
INVESTOR DEFAULT AMOUNT $____________
INVESTOR UNCOVERED DILUTION AMOUNT $____________
NOTEHOLDER SERVICING FEES $____________
AVAILABLE PRINCIPAL COLLECTIONS $____________
EXCESS FINANCE CHARGE COLLECTIONS $____________
SHARED PRINCIPAL COLLECTIONS $____________
CASH COLLATERAL ACCOUNT BALANCE $____________
RESERVE ACCOUNT BALANCE $____________
SPREAD ACCOUNT BALANCE $____________
APPLICATION OF COLLECTIONS -
CLASS A MONTHLY INTEREST $____________
CLASS A NET SWAP PAYMENT $____________
CLASS B MONTHLY INTEREST $____________
CLASS B NET SWAP PAYMENT $____________
CLASS C MONTHLY INTEREST $____________
CLASS C NET SWAP PAYMENT $____________
INVESTOR DEFAULT AMOUNT $____________
INVESTOR UNCOVERED DILUTION AMOUNT $____________
INVESTOR CHARGEOFFS AND REALLOCATED
PRINCIPAL COLLECTIONS NOT
PREVIOUSLY REIMBURSED $____________
AMOUNTS TO BE DEPOSITED
IN THE CASH COLLATERAL ACCOUNT $____________
AMOUNTS TO BE DEPOSITED IN THE
RESERVE ACCOUNT $____________
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AMOUNTS TO BE DEPOSITED
Exhibit C-1 (Page 4)
IN THE SPREAD ACCOUNT $____________
EXCESS FINANCE CHARGES COLLECTIONS -
TOTAL EXCESS FINANCE CHARGE COLLECTIONS
FOR ALL ALLOCATION SERIES $____________
SHARED PRINCIPAL COLLECTIONS -
TOTAL SHARED PRINCIPAL COLLECTIONS
FOR ALL ALLOCATIONS SERIES $____________
YIELD AND BASE RATE -
Base Rate (Current Month) _____________%
Base Rate (Prior Month) _____________%
Base Rate (Two Months Ago) _____________%
THREE MONTH AVERAGE BASE RATE ____________%
Portfolio Yield (Current Month) _____________%
Portfolio Yield (Prior Month) _____________%
Portfolio Yield (Two Months Ago) _____________%
THREE MONTH AVERAGE PORTFOLIO YIELD ____________%
PORTFOLIO ADJUSTED YIELD ____________%
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PRINCIPAL COLLECTIONS -
Exhibit C-1 (Page 5)
MONTHLY PRINCIPAL ____________%
PRINCIPAL ACCUMULATION ACCOUNT BALANCE $____________
SERIES 2001-A PRINCIPAL SHORTFALL $____________
SHARED PRINCIPAL COLLECTIONS ALLOCABLE
FROM OTHER PRINCIPAL SHARING SERIES $____________
INVESTOR CHARGE OFFS AND REDUCTIONS -
INVESTOR CHARGE OFFS $____________
REALLOCATED PRINCIPAL COLLECTIONS $____________
REDUCTIONS IN COLLATERAL AMOUNT
(OTHER THAN BY PRINCIPAL PAYMENTS) $____________
REDUCTIONS IN COLLATERAL AMOUNT DUE TO
APPLICATION OF AVAILABLE PRINCIPAL
COLLECTIONS AS SHARED PRINCIPAL
COLLECTIONS $____________
PREVIOUS REDUCTIONS IN COLLATERAL AMOUNT
REIMBURSED $____________
__________________________________________
as Indenture Trustee
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By:_______________________________________ Name:
Title:
Exhibit C-1 (Page 6)
EXHIBIT D
FORM OF MONTHLY SERVICER'S CERTIFICATE
WORLD FINANCIAL NETWORK NATIONAL BANK
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST SERIES 2001-A
The undersigned, a duly authorized representative of World Financial Network National Bank ("WFN"), as Servicer pursuant to the Transfer and Servicing Agreement, dated as of August 1, 2001 (as amended and supplemented, the "TRANSFER AND SERVICING AGREEMENT"), among WFN Credit Company, LLC, as Transferor, World Financial Network National Bank, as Servicer and World Financial Network Master Note Trust (the "TRUST"), as Issuer, does hereby certify as follows:
1. Capitalized terms used in this Certificate have their respective meanings set forth in the Transfer and Servicing Agreement or the Master Indenture dated as of August 1, 2001 (as amended or supplemented, the "MASTER INDENTURE"), between the Trust and BNY Midwest Trust Company, as indenture trustee (the "INDENTURE TRUSTEE") as supplemented by the Series 2001-A Indenture Supplement, dated as of August 21, 2001, between the Trust and the Indenture Trustee (as amended and supplemented, the "INDENTURE SUPPLEMENT") and together with the Master Indenture, the "INDENTURE"), as applicable.
2. WFN is, as of the date hereof, the Servicer under the Transfer and Servicing Agreement.
3. The undersigned is an Authorized Officer of the Servicer.
4. This Certificate relates to the Distribution Date occurring on ________ __, 200_.
5. As of the date hereof, to the best knowledge of the undersigned, the Servicer has performed in all material respects all of its obligations under the Transfer and Servicing Agreement and the Indenture through the Monthly Period preceding such Distribution Date [or, if there has been a default in the performance of any such obligation, set forth in detail the (i) nature of such default, (ii) the action taken by the Servicer, if any, to remedy such default and (iii) the current status of each such default]; if applicable, insert "None".
6. As of the date hereof, to the best knowledge of the undersigned, no Early Amortization Event occurred on or prior to such Distribution Date.
Exhibit D (Page 1)
IN WITNESS WHEREOF, the undersigned has duly executed and delivered this Certificate this ___ day of _____________ __, 20__.
WORLD FINANCIAL NETWORK NATIONAL
BANK, as Servicer
By:_____________________________
Name:
Title:
Exhibit D (Page 2)
EXHIBIT E-1
FORM OF CLASS A SWAP
Included in Exhibit 4.9 (ISDA Master Agreement), Exhibit 4.10 (Schedule A to Master Agreement and Exhibit 4.11 (Class A Confirmation)
Exhibit E-1 (Page 1)
EXHIBIT E-2
FORM OF CLASS B SWAP
Included in Exhibit 4.9 (ISDA Master Agreement), Exhibit 4.10 (Schedule A to Master Agreement) and Exhibit 4.12 (Class B Confirmation)
Exhibit E-2 (Page 1)
EXHIBIT E-3
FORM OF CLASS C SWAP
Included in Exhibit 4.9 (ISDA Master Agreement), Exhibit 4.10 (Schedule A to Master Agreement) and Exhibit 4.13 (Class C Confirmation)
Exhibit E-3 (Page 1)
SCHEDULE 1
PERFECTION REPRESENTATIONS, WARRANTIES
AND COVENANTS
(a) In addition to the representations, warranties and covenants contained in the Indenture, the Issuer hereby represents, warrants and covenants to the Indenture Trustee as follows as of the Closing Date:
(1) The Indenture creates a valid and continuing security interest (as defined in the applicable Uniform Commercial Code) in the Net Swap Receipts in favor of the Indenture Trustee, which security interest is prior to all other Liens, and is enforceable as such against creditors of and purchasers from Issuer.
(2) The Net Swap Receipts constitute "general intangibles" within the meaning of the applicable Uniform Commercial Code.
(3) Issuer owns and has good and marketable title to the Net Swap Receipts free and clear of any Lien, claim or encumbrance of any Person.
(4) There are no consents or approvals required by the terms of the Class A Swap, Class B Swap or Class C Swap for the pledge of the Net Swap Receipts to the Indenture Trustee pursuant to the Indenture.
(5) Issuer (or the Administrator on behalf of the Issuer) has caused 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 granted to the Indenture Trustee under the Indenture in the Net Swap Receipts.
(6) Other than the pledge of the Net Swap Receipts to Indenture Trustee pursuant to the Indenture, Issuer has not pledged, assigned, sold, granted a security interest in, or otherwise conveyed the Net Swap Receipts. Issuer has not authorized the filing of and is not aware of any financing statements against Issuer that include a description of the Net Swap Receipts, except for the financing statement filed pursuant to the Indenture.
(7) Notwithstanding any other provision of the Indenture, the representations and warranties set forth in this SCHEDULE 1 shall be continuing, and remain in full force and effect, until such time as the Series 2001-A Notes are retired.
(b) Indenture Trustee covenants that it shall not, without satisfying the Rating Agency Condition, waive a breach of any representation or warranty set forth in this SCHEDULE 1.
(c) The Servicer covenants that in order to evidence the interests of Issuer and Indenture Trustee under the Indenture, Servicer shall take such action, or execute and deliver such instruments as may be necessary or advisable (including, without limitation, such actions as are requested by Indenture Trustee) to maintain and perfect, as a first priority interest, Indenture Trustee's security interest in the Net Swap Receipts.
Exhibit 4.3
TRANSFER AND SERVICING AGREEMENT
between
WFN CREDIT COMPANY, LLC,
Transferor,
WORLD FINANCIAL NETWORK NATIONAL BANK,
Servicer,
and
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST,
Issuer,
Dated as of August 1, 2001
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS.......................................................................1
Section 1.1 Definitions..............................................................1
Section 1.2 Other Definitional Provisions............................................1
ARTICLE II CONVEYANCE OF RECEIVABLES.........................................................2
Section 2.1 Conveyance of Receivables................................................2
Section 2.2 Acceptance by Issuer.....................................................4
Section 2.3 Representations and Warranties of Transferor Relating to Transferor......4
Section 2.4 Representations and Warranties of Transferor Relating to Transaction
Documents and the Receivables............................................6
Section 2.5 Covenants of Transferor.................................................11
Section 2.6 Addition of Accounts....................................................17
Section 2.7 Removal of Accounts.....................................................22
Section 2.8 Discount Option.........................................................24
Section 2.9 Additional Transferors..................................................25
Section 2.10 Additional Credit Card Originators......................................25
ARTICLE III ADMINISTRATION AND SERVICING OF RECEIVABLES......................................25
Section 3.1 Acceptance of Appointment and Other Matters Relating to Servicer........26
Section 3.2 Servicing Compensation..................................................27
Section 3.3 Representations, Warranties and Covenants of Servicer...................28
Section 3.4 Reports and Records for Indenture Trustee...............................31
Section 3.5 Annual Servicer's Certificate...........................................32
Section 3.6 Annual Independent Public Accountants' Servicing Report.................32
Section 3.7 Tax Treatment...........................................................33
Section 3.8 Notices to Transferor...................................................33
Section 3.9 Adjustments.............................................................33
Section 3.10 Reports to the Commission...............................................34
ARTICLE IV OTHER MATTERS RELATING TO TRANSFEROR.............................................34
Section 4.1 Liability of Transferor.................................................34
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Section 4.2 Merger or Consolidation of, or Assumption of the Obligations of,
Transferor etc..........................................................37
Section 4.3 Limitation on Liability of Transferor...................................38
ARTICLE V OTHER MATTERS RELATING TO SERVICER...............................................39
Section 5.1 Liability of Servicer...................................................39
Section 5.2 Merger or Consolidation of, or Assumption of the
Obligations of, Servicer................................................39
Section 5.3 Limitation on Liability of Servicer and Others..........................40
Section 5.4 Indemnification of Issuer and Owner Trustee.............................40
Section 5.5 Servicer Not to Resign..................................................41
Section 5.6 Access to Certain Documentation and Information
Regarding the Receivables...............................................42
Section 5.7 Delegation of Duties....................................................42
ARTICLE VI INSOLVENCY EVENTS................................................................42
Section 6.1 Rights upon the Occurrence of an Insolvency Event.......................42
ARTICLE VII SERVICER DEFAULTS................................................................43
Section 7.1 Servicer Defaults.......................................................43
Section 7.2 Indenture Trustee to Act; Appointment of Successor......................45
Section 7.3 Notification to Noteholders.............................................47
ARTICLE VIII TERMINATION......................................................................47
Section 8.1 Termination of Agreement................................................47
ARTICLE IX MISCELLANEOUS PROVISIONS.........................................................47
Section 9.1 Amendment; Waiver of Past Defaults......................................47
Section 9.2 Protection of Right, Title and Interest to Issuer.......................50
Section 9.3 GOVERNING LAW...........................................................51
Section 9.4 Notices; Payments.......................................................51
Section 9.5 Severability of Provisions..............................................51
Section 9.6 Further Assurances......................................................52
Section 9.7 No Waiver; Cumulative Remedies..........................................52
Section 9.8 Counterparts............................................................52
Section 9.9 Third-Party Beneficiaries...............................................52
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Section 9.10 Actions by Noteholders..................................................52
Section 9.11 Rule 144A Information...................................................53
Section 9.12 Merger and Integration..................................................53
Section 9.13 No Bankruptcy Petition..................................................53
Section 9.14 Rights of Indenture Trustee.............................................53
Section 9.15 Rights of Owner Trustee.................................................53
EXHIBITS
--------
EXHIBIT A Form of Assignment of Receivables in Additional Accounts ...........................A-1
EXHIBIT B Form of Reassignment of Receivables in Removed Accounts ............................B-1
EXHIBIT C Form of Annual Servicer's Certificate...............................................C-1
EXHIBIT D-1 Form of Opinion of Counsel with Respect to Amendments.............................D-1-1
EXHIBIT D-2 Form of Opinion of Counsel with Respect to Addition of
Supplemental Accounts.............................................................D-2-1
EXHIBIT D-3 Provisions to be Included in Annual Opinion of Counsel............................D-3-1
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SCHEDULE 1 List of Accounts 1-1
TRANSFER AND SERVICING AGREEMENT, dated as of August 1, 2001 (this "AGREEMENT"), among WFN CREDIT COMPANY, LLC, a Delaware limited liability company, as Transferor, WORLD FINANCIAL NETWORK NATIONAL BANK, a national banking association, as Servicer, and WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST, a business trust organized under the laws of the State of Delaware, as Issuer.
In consideration of the mutual agreements herein contained, each party agrees as follows for the benefit of the other parties, the Noteholders and any Enhancement Provider to the extent provided herein, in the Indenture and in any Indenture Supplement:
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. Capitalized terms used herein and not otherwise defined herein are defined in ANNEX A to the Master Indenture, dated as of the date hereof, between World Financial Network Credit Card Master Note Trust and BNY Midwest Trust Company.
Section 1.2 OTHER DEFINITIONAL PROVISIONS. All terms defined directly or by reference in this Agreement shall have the defined meanings when used in any certificate or other document delivered pursuant hereto unless otherwise defined therein. For purposes of this Agreement and all such certificates and other documents, unless the context otherwise requires: (a) accounting terms not otherwise defined in this Agreement, and accounting terms partly defined in this Agreement to the extent not defined, shall have the respective meanings given to them under GAAP; (b) terms defined in Article 9 of the UCC as in effect in the State of Delaware and not otherwise defined in this Agreement are used as defined in that Article; (c) any reference to each Rating Agency shall only apply to any specific rating agency if such rating agency is then rating any outstanding Series; (d) references to any amount as on deposit or outstanding on any particular date means such amount at the close of business on such day; (e) the words "hereof," "herein" and "hereunder" and words of similar import refer to this Agreement (or the certificate or other document in which they are used) as a whole and not to any particular provision of this Agreement (or such certificate or document); (f) references to any Section, Schedule or Exhibit are references to Sections, Schedules and Exhibits in or to this Agreement (or the certificate or other document in which the reference is made), and references to any paragraph, Section, clause or other subdivision within any Section or definition refer to such paragraph, subsection, clause or other subdivision of such Section or definition; (g) the term "including" means "including without limitation"; (h) references to any law or regulation refer to that law or regulation as amended from time to time and include any successor law or regulation; (i) references to any Person include that Person's successors and assigns; and (j) headings are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof.
ARTICLE II
CONVEYANCE OF RECEIVABLES
Section 2.1 CONVEYANCE OF RECEIVABLES. (a) By execution of this
Agreement, Transferor does hereby transfer, assign, set over and otherwise
convey to Issuer, without recourse except as provided herein, all its right,
title and interest in, to and under (a) the Collateral Certificate, and (b)
effective on the Certificate Trust Termination Date, (i) the Receivables
existing at the opening of business on the Certificate Trust Termination Date,
and thereafter created from time to time until the termination of Issuer, all
Collections and Recoveries allocable to Issuer as provided herein and the right
to any Enhancement with respect to any Series, in each case together with all
monies due or to become due and all amounts received or receivable with respect
thereto and all proceeds thereof and Insurance Proceeds relating thereto and
(ii) without limiting the generality of the foregoing or the following, all of
Transferor's rights pursuant to the Receivables Purchase Agreement to receive
from the RPA Seller payments made by any Merchant under any Credit Card
Processing Agreement on account of amounts received by such Merchant in payment
of Receivables ("IN-STORE PAYMENTS") and all proceeds of such rights. Such
property, together with all monies and other property credited to the Collection
Account, the Series Accounts and the Excess Funding Account (including any
subaccounts of any such account) and the rights of Issuer under this Agreement
and the Trust Agreement shall constitute the assets of Issuer (the "TRUST
ASSETS"). The foregoing does not constitute and is not intended to result in the
creation or assumption by Issuer, Owner Trustee, Indenture Trustee or any
Noteholder of any obligation of any Credit Card Originator, Servicer, Transferor
or any other Person in connection with the Accounts or the Receivables or under
any agreement or instrument relating thereto, including any obligation to
Obligors, merchant banks, merchants, clearance systems or insurers. Effective on
the Certificate Trust Termination Date, Transferor does hereby further transfer,
assign, set over and otherwise convey to Issuer all of its right, title and
interest in and under the Receivables Purchase Agreement.
(b) On or prior to the Initial Closing Date, Transferor shall deliver to Issuer a registered certificate representing the Collateral Certificate. On or prior to the Certificate Trust Termination Date, Transferor agrees to record and file, at its own expense, financing statements (and continuation statements when applicable) with respect to the Receivables conveyed by Transferor existing on the Certificate Trust Termination Date and thereafter created 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 and assignment of its interest in such Receivables to Issuer, and to deliver a file stamped copy of each such financing statement or other evidence of such filing (which may, for purposes of this SECTION 2.1 consist of telephone confirmation of such filing promptly followed by delivery to Owner Trustee of a file-stamped copy) to Owner Trustee as soon as practicable after the Certificate Trust Termination Date, and (if any additional filing is so necessary) as soon as practicable after the applicable Addition Date,
in the case of Receivables arising in Supplemental Accounts and any related Automatic Additional Accounts. Owner Trustee shall be under no obligation whatsoever to file such financing or continuation statements or to make any other filing under the UCC in connection with such transfer and assignment.
(c) Transferor further agrees, at its own expense, (i) on or prior
to (w) the Certificate Trust Termination Date, (x) the Automatic Addition
Termination Date or any Automatic Addition Suspension Date, or subsequent
Restart Date, in the case of the Accounts designated pursuant hereto prior to
such date, (y) the applicable Addition Date, in the case of Supplemental
Accounts and (z) 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
owned by the Credit Card Originator have been conveyed to Issuer pursuant to
this Agreement (or conveyed to Transferor or its designee in accordance with
SECTION 2.7, in the case of Removed Accounts) by including in such computer
files the code identifying each such Account (or, in the case of Removed
Accounts, either including such a code identifying the Removed Accounts only if
the removal occurs prior to the Automatic Addition Termination Date or an
Automatic Addition Suspension Date, or subsequent to a Restart Date, or deleting
such code thereafter) and (ii) on or prior to the date referred to in CLAUSES
(i)(w), (x), (y) or (z), as applicable, to deliver to Issuer an Account Schedule
(PROVIDED that such Account Schedule shall be provided in respect of Automatic
Additional Accounts on or prior to the Determination Date relating to the
Monthly Period during which their respective Addition Dates occur), specifying
for each such Account, as of the Certificate Trust Termination Date, in the case
of clause (i)(w), as of the Automatic Addition Termination Date, the Automatic
Addition Suspension Date or Restart Date, in the case of clause (i)(x), the
applicable Addition Cut Off Date, in the case of Supplemental Accounts and the
Removal Date, in the case of Removed Accounts, its account number and, the
aggregate amount outstanding in such Account and the aggregate amount of
Principal Receivables outstanding in such Account. Such Account Schedule, as
supplemented from time to time to reflect Additional Accounts and Removed
Accounts shall be marked as SCHEDULE 1 to this Agreement and is hereby
incorporated into and made a part of this Agreement. Once the code referenced in
CLAUSE (i) of this paragraph has been included with respect to any Account,
Transferor further agrees not to alter such code during the remaining term of
this Agreement unless and until (x) such Account becomes a Removed Account, (y)
a Restart Date has occurred on which Transferor starts including Automatic
Additional Accounts as Accounts or (z) Transferor shall have delivered to Issuer
at least 30 days' prior written notice of its intention to do so and has taken
such action as is necessary or advisable to cause the interest of Issuer in the
Receivables and the other Trust Assets to continue to be perfected with the
priority required by this Agreement.
(d) If the arrangements with respect to the Receivables hereunder shall constitute a loan and not a purchase and sale of such Receivables, it is the intention of the parties hereto that this Agreement shall constitute a security agreement under applicable
law, and that Transferor shall be deemed to have granted to Issuer a first priority perfected security interest in all of Seller's right, title and interest, whether owned on the Certificate Trust Termination Date or thereafter acquired, in, to and under the Receivables and the other Trust Assets conveyed by Transferor, and all money, accounts, general intangibles, chattel paper, instruments, documents, goods, investment property, deposit accounts, certificates of deposit, letters of credit, and advices of credit consisting of, arising from or related to the Trust Assets, to secure its obligations hereunder.
Section 2.2 ACCEPTANCE BY ISSUER.
(a) Issuer hereby acknowledges its acceptance of all right, title and interest to the property, now existing and hereafter created, conveyed to Issuer pursuant to SECTION 2.1. Owner Trustee shall maintain a copy of SCHEDULE 1, as delivered to it from time to time, at its Corporate Trust Office.
(b) Owner Trustee hereby agrees not to disclose to any Person any of the account numbers or other information contained in the Account Schedule marked as SCHEDULE 1 and delivered to Owner Trustee or Issuer, from time to time, except (i) to a Successor Servicer or as required by a Requirement of Law applicable to Owner Trustee, (ii) in connection with the performance of Owner Trustee's or Issuer's duties hereunder, (iii) to Indenture Trustee in connection with its duties in enforcing the rights of Noteholders or (iv) to bona fide creditors or potential creditors of Servicer or Transferor for the limited purpose of enabling any such creditor to identify Receivables or Accounts subject to this Agreement or the Receivables Purchase Agreement. Owner Trustee agrees to take such measures as shall be reasonably requested by Transferor to protect and maintain the security and confidentiality of such information and, in connection therewith, shall allow Transferor or its duly authorized representatives to inspect Owner Trustee's security and confidentiality arrangements as they specifically relate to the administration of Issuer from time to time during normal business hours upon prior written notice. Owner Trustee shall promptly notify the Transferor of any request received by the Owner Trustee to disclose information of the type described in this SECTION 2.2(b), which notice shall in any event be provided no later than five (5) Business Days prior to disclosure of any such information unless the Owner Trustee is compelled pursuant to a Requirement of Law to disclose such information prior to the date that is five (5) Business Days after the giving of such notice.
Section 2.3 REPRESENTATIONS AND WARRANTIES OF TRANSFEROR RELATING TO TRANSFEROR. Transferor hereby represents and warrants to Issuer as of each Closing Date that:
(a) ORGANIZATION AND GOOD STANDING. Transferor is a limited liability company validly existing in good standing under the laws of the State of Delaware, and has full power, authority and legal right to own its properties and conduct its business as presently owned and conducted, to execute, deliver and perform its obligations under each Transaction Document.
(b) DUE QUALIFICATION. Transferor is duly qualified to do business and is in good standing as a foreign corporation (or is exempt from such requirements), and has obtained all necessary licenses and approvals in each jurisdiction in which failure to so qualify or to obtain such licenses and approvals would render any Credit Card Agreement or any Receivable transferred to Issuer by Transferor unenforceable by the Credit Card Originator, Transferor, Servicer, Issuer or Indenture Trustee and would have a material adverse effect on the interests of the Holders.
(c) DUE AUTHORIZATION. The execution, delivery and performance by Transferor of this Agreement and each other Transaction Document to which it is a party, the execution and delivery of the Notes by Transferor and the consummation by Transferor of the transactions provided for in each Transaction Document to which it is a party have been duly authorized by Transferor by all necessary limited liability company action on the part of Transferor.
(d) NO CONFLICT. The execution and delivery by Transferor of each Transaction Document to which it is a party and the Notes, the performance by Transferor of the transactions contemplated by each Transaction Document to which it is a party and the fulfillment by Transferor of the terms hereof and thereof will not conflict with, result in any breach of any of the material terms and provisions of, or constitute (with or without notice or lapse of time or both) a material default under, any indenture, contract, agreement, mortgage, deed of trust, or other instrument to which Transferor is a party or by which it or any of its properties are bound.
(e) NO VIOLATION. The execution and delivery by Transferor of each Transaction Document to which it is a party and the Notes, the performance by Transferor of the transactions contemplated by the Transaction Documents and the fulfillment by Transferor of the terms thereof will not conflict with or violate any Requirements of Law applicable to Transferor.
(f) NO PROCEEDINGS. There are no proceedings or investigations
pending or, to the best knowledge of Transferor, threatened against Transferor,
before any court, regulatory body, administrative agency, or other tribunal or
governmental instrumentality (i) asserting the invalidity of any Transaction
Documents or the Notes, (ii) seeking to prevent the issuance of the Notes or the
consummation of any of the transactions contemplated by any Transaction
Documents or the Notes, (iii) seeking any determination or ruling that, in the
reasonable judgment of Transferor, would materially and adversely affect the
performance by Transferor of its obligations under any Transaction Document,
(iv) seeking any determination or ruling that would materially and adversely
affect the validity or enforceability of any Transaction Documents or the Notes
or (v) seeking to affect adversely the income tax attributes of Issuer under the
Federal or applicable state income or franchise tax systems.
(g) ALL CONSENTS REQUIRED. All approvals, authorizations, consents, orders or other actions of any Person or of any governmental body or official required in
connection with the execution and delivery by Transferor of each Transaction Document and the Notes, the performance by Transferor of the transactions contemplated by each Transaction Document, and the fulfillment of or terms hereof and thereof, have been obtained.
(h) INSOLVENCY. No Insolvency Event with respect to Transferor has occurred. Transferor did not (i) execute the Transaction Documents, (ii) grant to Issuer the security interests described in SECTION 2.1, (iii) cause, permit, or suffer the perfection or attachment of such a security interest, (iv) otherwise effectuate or consummate any transfer to Issuer pursuant to any Transaction Document or (v) acquire its interest in Issuer, in each case:
(A) in contemplation of insolvency;
(B) with a view to preferring one creditor over another or to preventing the application of its assets in the manner required by applicable law or regulations;
(C) after committing an act of insolvency; or
(D) with any intent to hinder, delay, or defraud itself or its creditors.
The representations and warranties set forth in this SECTION 2.3 shall survive the transfer and assignment by Transferor of the respective Receivables and other Trust Assets to Issuer and the pledge thereof to Indenture Trustee pursuant to the Indenture. Upon discovery by Transferor, Servicer or Owner Trustee of a breach of any of the representations and warranties set forth in this SECTION 2.3, the party discovering such breach shall give prompt written notice to the others and each Enhancement Provider, if any, entitled thereto pursuant to the relevant Indenture Supplement. Transferor agrees to cooperate with Servicer and Owner Trustee in attempting to cure any such breach. For purposes of the representations and warranties set forth in this SECTION 2.3, each reference to an Indenture Supplement shall be deemed to refer only to those Indenture Supplements in effect as of the relevant Closing Date.
Section 2.4 REPRESENTATIONS AND WARRANTIES OF TRANSFEROR RELATING TO TRANSACTION DOCUMENTS AND THE RECEIVABLES.
(a) REPRESENTATIONS AND WARRANTIES. Transferor represents and warrants to Issuer as of the date of the Initial Closing Date, each Closing Date, the Certificate Trust Termination Date and, with respect to Additional Accounts, the related Addition Date that:
(i) each Transaction Document and, in the case of Supplemental Accounts, the related Assignment, each constitutes a legal, valid and binding
obligation of Transferor, enforceable against Transferor in accordance with its terms, except as such enforceability may be limited by applicable Debtor Relief Laws now or hereafter in effect and by general principles of equity (whether considered in a suit at law or in equity);
(ii) as of the Automatic Addition Termination Date or any Automatic Addition Suspension Date and as of each subsequent Addition Date with respect to Supplemental Accounts, and as of the applicable Removal Date with respect to the Removed Accounts, the Account Schedule delivered pursuant to this Agreement, as supplemented to such date, is an accurate and complete listing in all material respects of all the Accounts as of such Automatic Addition Termination Date, such Automatic Addition Suspension Date, the related Addition Cut Off Date or such Removal Date, as the case may be, and the information contained therein with respect to the identity of such Accounts and the Receivables existing in such Accounts is true and correct in all material respects as of such specified date;
(iii) Transferor is the legal and beneficial owner of all right, title and interest in each Receivable and Transferor has the full right to transfer such Receivables to Issuer, and each Receivable conveyed to Issuer by Transferor has been conveyed to Issuer free and clear of any Lien of any Person claiming through or under Transferor or any of its Affiliates (other than Liens permitted under SECTION 2.5(b)) and in compliance, in all material respects, with all Requirements of Law applicable to Transferor;
(iv) all authorizations, consents, orders or approvals of or registrations or declarations with any Governmental Authority required to be obtained, effected or given by Transferor in connection with the conveyance by Transferor of the Collateral Certificate and Receivables to Issuer have been duly obtained, effected or given and are in full force and effect;
(v) the transfer and assignment of the Collateral Certificate herein contemplated constitutes either (i) a sale of the Collateral Certificate, (ii) a grant of a perfected security interest therein from Transferor to Issuer or (iii) a grant of a perfected security interest therein from Transferor to Indenture Trustee. The Collateral Certificate has not been sold, transferred, assigned or pledged by Transferor to any Person other than pursuant to this Agreement. Immediately prior to the transfer and assignment herein contemplated, Transferor had good and marketable title to the Collateral Certificate, free and clear of all Liens and rights of others and, immediately upon the transfer thereof, Issuer shall have good and marketable title to the Collateral Certificate, free and clear of all Liens and rights of others or a first priority perfected security interest therein; and the transfer has been perfected, by the filing of appropriate financing statements pursuant to the
UCC, under the UCC. Transferor has no knowledge of any current statutory or other non-consensual liens to which the Collateral Certificate is subject.
(vi) all actions necessary under the applicable UCC in any jurisdiction to be taken (A) to give Issuer a first priority perfected security interest or ownership interest in the Collateral Certificate, and (B) to give Indenture Trustee a first priority perfected security interest in the Collateral (including, without limitation, UCC filings with the Delaware Secretary of State), in each case subject to any statutory or other non-consensual liens with respect to the Collateral Certificate, have been taken. Transferor has no knowledge of any current statutory or other non-consensual liens to which the Collateral Certificate is subject.
(vii) this Agreement or, in the case of Supplemental Accounts, the related Assignment constitutes either a valid sale, transfer and assignment to Issuer of all right, title and interest of Transferor in the Receivables and other Trust Assets conveyed to Issuer by Transferor and all monies due or to become due with respect thereto and the proceeds thereof or a grant of a security interest in such property to Issuer, which, (A) with respect to Receivables existing on the Certificate Trust Termination Date and the proceeds thereof, is enforceable upon the Certificate Trust Termination Date, or (B) with respect to the then existing Receivables in Additional Accounts, as of the applicable Addition Date, and which will be enforceable with respect to such Receivables thereafter created and the proceeds thereof upon such creation, in each case except as such enforceability may be limited by applicable Debtor Relief Laws, now or hereafter in effect, and by general principles of equity (whether considered in a suit at law or in equity). Upon the filing of the financing statements pursuant to SECTION 2.1 and, in the case of Receivables hereafter created and the proceeds thereof, upon the creation thereof, Issuer shall have a first priority perfected security interest in such property and proceeds except for Liens permitted under SECTION 2.5(b);
(viii) except as otherwise expressly provided in this Agreement, the Indenture or any Indenture Supplement, neither Transferor nor any Person claiming through or under Transferor has any claim to or interest in the Collection Account, the Excess Funding Account, any Series Account or any Enhancement;
(ix) on the date of its creation or the date it otherwise becomes an Automatic Additional Account, with respect to each Automatic Additional Account and, on the applicable Addition Cut Off Date, with respect to each related Supplemental Account, each such Account is an Eligible Account;
(x) on the date of creation of each Automatic Additional Account or the date the related account otherwise becomes an Automatic Additional Account, each Receivable contained in such Automatic Additional Account is an Eligible
Receivable and, on the applicable Addition Cut Off Date, each Receivable contained in any related Supplemental Account is an Eligible Receivable; and
(xi) as of the date of the creation of any new Receivable, such Receivable is an Eligible Receivable.
(b) As of the Certificate Trust Termination Date, Transferor agrees that (i) all representations and warranties made by it in its capacity as Transferor under the Pooling and Servicing Agreement with respect to any Account or Receivable pursuant to SECTION 2.4(a) of the Pooling and Servicing Agreement and (ii) all of the covenants made by it under SECTION 2.7 of the Pooling and Servicing Agreement, in each case, shall be deemed for all purposes (including the reassignment obligations under SECTION 2.4(d)) to have been made by Transferor to Issuer pursuant to this Agreement as of the day when each was made or deemed made, as if this Agreement had been in effect on that day.
(c) NOTICE OF BREACH. The representations and warranties of Transferor set forth in this SECTION 2.4 shall survive the transfer and assignment by Transferor of the Collateral Certificate and Receivables to Issuer and the pledge thereof to Indenture Trustee pursuant to the Indenture. Upon discovery by Transferor, Servicer or a Responsible Officer of Owner Trustee of a breach of any of the representations and warranties by Transferor set forth in this SECTION 2.4, the party discovering such breach shall give prompt written notice to the others and to each Enhancement Provider, if any, entitled thereto pursuant to the relevant Indenture Supplement. Transferor agrees to cooperate with Servicer and Owner Trustee in attempting to cure any such breach. For purposes of the representations and warranties set forth in this SECTION 2.4, each reference to an Indenture Supplement shall be deemed to refer only to those Indenture Supplements in effect as of the date of the relevant representations or warranties.
(d) REASSIGNMENT OF INELIGIBLE RECEIVABLES. If (i) any
representation or warranty of Transferor contained in SECTION 2.4(a)(ii), (iii),
(iv), (ix), (x) or (xi) or any representation or warranty of Transferor (as
defined in the Pooling and Servicing Agreement) contained in SECTION 2.4(a)(ii),
(iii), (iv), (vii), (viii) or (ix) of the Pooling and Servicing Agreement and
deemed made under this Agreement pursuant to SECTION 2.4(b) of this Agreement is
not true and correct in any material respect as of the date specified therein
with respect to any Receivable transferred to Issuer by Transferor or any
Account and as a result of such breach any Receivables in the related Account
become Defaulted Receivables or Issuer's rights in, to or under such Receivables
or the proceeds of such Receivables are impaired or such proceeds are not
available for any reason to Issuer free and clear of any Lien, unless cured
within 60 days (or such longer period, not in excess of 150 days, as may be
agreed to by Indenture Trustee) after the earlier to occur of the discovery
thereof by Transferor or receipt by Transferor or a designee of Transferor of
notice thereof given by Indenture Trustee, or (ii) it is so provided in SECTION
2.5(a) with respect to any Receivables transferred to Issuer by Transferor, then
such Receivable shall be designated an "INELIGIBLE RECEIVABLE" and shall be
assigned a
principal balance of zero for the purpose of determining the aggregate amount of
Principal Receivables on any day; PROVIDED that such Receivables will not be
deemed to be Ineligible Receivables but will be deemed Eligible Receivables and
such Principal Receivables shall be included in determining the aggregate
Principal Receivables in Issuer if, on any day prior to the end of such 60-day
or longer period, (x) either (A) in the case of an event described in CLAUSE
(i), the relevant representation and warranty shall be true and correct in all
material respects as if made on such day or (B) in the case of an event
described in CLAUSE (ii), the circumstances causing such Receivable to become an
Ineligible Receivable shall no longer exist and (y) Transferor shall have
delivered an Officer's Certificate describing the nature of such breach and the
manner in which the relevant representation and warranty became true and
correct.
(e) PRICE OF REASSIGNMENT. On and after the date of its designation as an Ineligible Receivable, each Ineligible Receivable shall not be given credit in determining the aggregate amount of Principal Receivables used to calculate the Transferor Amount or the Allocation Percentages applicable to any Series. If, following the exclusion of such Principal Receivables from the calculation of the Transferor Amount, the Transferor Amount would be less than the Specified Transferor Amount, Transferor shall make a deposit into the Excess Funding Account in immediately available funds prior to the next succeeding Business Day in an amount equal to the amount by which the Transferor Amount would be less than the Specified Transferor Amount (up to the amount of such Principal Receivables). The payment of such deposit amount in immediately available funds shall otherwise be considered payment in full of all of the Ineligible Receivables.
The obligation of Transferor to make the deposits, if any, required to be made to the Excess Funding Account as provided in this Section, shall constitute the sole remedy respecting the event giving rise to such obligation available to Issuer, Owner Trustee, the Holders (or Indenture Trustee on behalf of the Noteholders) or any Enhancement Provider.
(f) REASSIGNMENT OF RECEIVABLES IN TRUST PORTFOLIO. If any representation or warranty of Transferor contained in SECTION 2.3(a), (b) or (c) or SECTION 2.4(a)(i), (vii) or (viii) of this Agreement, or any representation or warranty of Transferor (as defined in the Pooling and Servicing Agreement) contained in Section 2.4(a)(i), (v) or (vi) of the Pooling and Servicing Agreement and deemed made under this Agreement pursuant to SECTION 2.4(b) of this Agreement, is not true and correct in any material respect and such breach has a material adverse effect on the Receivables transferred to Issuer by Transferor or the availability of the proceeds thereof to Issuer, then any of Issuer, Indenture Trustee or the Majority Holders, by notice then given to Transferor and Servicer (and to Indenture Trustee if given by the Noteholders), may direct Transferor to accept a reassignment of the Receivables transferred to Issuer by 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 150 days, as may be specified in such notice), and upon those conditions Transferor shall be obligated to
accept such reassignment on the terms set forth below; PROVIDED that such
Receivables will not be reassigned to Transferor if, on any day prior to the end
of such 60-day or longer period (i) the relevant representation and warranty
shall be true and correct in all material respects as if made on such day and
(ii) Transferor shall have delivered an Officer's Certificate describing the
nature of such breach and the manner in which the relevant representation and
warranty became true and correct.
Transferor shall deposit in the Collection Account in immediately available funds not later than 12:00 noon, New York City time, on the first Distribution Date following the Monthly Period in which such reassignment obligation arises, in payment for such reassignment, an amount equal to the sum of the amounts specified therefor with respect to each outstanding Series in the related Indenture Supplement. Notwithstanding anything to the contrary in this Agreement, such amounts shall be distributed on such Distribution Date in accordance with the Indenture and each Indenture Supplement. The payment of such deposit amount in immediately available funds shall otherwise be considered payment in full of all of the Receivables.
Upon the deposit, if any, required to be made to the Collection Account as provided in this SECTION 2.4(f), Issuer shall automatically and without further action be deemed to transfer, assign, set over and otherwise convey to Transferor or its designee, without recourse, representation or warranty, all the right, title and interest of Issuer in and to the applicable Receivables, all moneys due or to become due and all amounts received with respect thereto and all proceeds thereof. Issuer shall execute such documents and instruments of transfer or assignment and take such other actions as shall reasonably be requested by Transferor to effect the conveyance of such Receivables pursuant to this Section. The obligation of Transferor to accept reassignment of any Receivables, and to make the deposits, if any, required to be made to the Collection Account as provided in this Section, shall constitute the sole remedy respecting the event giving rise to such obligation available to Issuer, Owner Trustee, the Holders (or Indenture Trustee on behalf of the Noteholders).
Section 2.5 COVENANTS OF TRANSFEROR. Transferor hereby covenants that:
(a) RECEIVABLES TO BE ACCOUNTS. Except in connection with the enforcement or collection of an Account, Transferor will take no action to cause any Receivable transferred by it to the Trust to be evidenced by any instrument and, if any such Receivable is so evidenced (whether or not in connection with the enforcement or collection of an Account), it shall be deemed to be an Ineligible Receivable in accordance with SECTION 2.4(d) and shall be reassigned to Transferor in accordance with SECTION 2.4(e).
(b) SECURITY INTERESTS. Except for the conveyances hereunder, Transferor will not sell, pledge, assign or transfer or otherwise convey to any other Person, or grant, create, incur, assume or suffer to exist any Lien on any Receivable, whether now existing or hereafter created, or any interest therein; Transferor will immediately notify Issuer and
Indenture Trustee of the existence of any Lien on any Receivable of which Transferor has knowledge; and Transferor shall defend the right, title and interest of the Issuer and Indenture Trustee in, to and under the Receivables, whether now existing or hereafter created, against all claims of third parties claiming through or under Transferor or RPA Seller; PROVIDED that nothing in this SECTION 2.5(b) shall prevent or be deemed to prohibit Transferor from suffering to exist upon any of the Receivables any Liens for taxes if such taxes shall not at the time be due and payable or if Transferor or RPA Seller, as applicable, shall currently be contesting the validity thereof in good faith by appropriate proceedings and shall have set aside on its books adequate reserves with respect thereto. Notwithstanding the foregoing, nothing in this SECTION 2.5(b) shall be construed to prevent or be deemed to prohibit the transfer of the Transferor Interest in accordance with this Agreement and the Trust Agreement.
(c) THE TRANSFEROR INTEREST. Except as otherwise permitted herein and in the Trust Agreement, including in SECTIONS 2.9 and 4.2 of this Agreement and in Section 3.4 of the Trust Agreement, Transferor agrees not to transfer, assign, exchange or otherwise convey or pledge, hypothecate or otherwise grant a security interest in the Transferor Interest (or any interest therein) or any Supplemental Interest (or any interest therein) and any such attempted transfer, assignment, exchange, conveyance, pledge, hypothecation or grant shall be void.
(d) DELIVERY OF COLLECTIONS OR RECOVERIES. If Transferor receives Collections or Recoveries, then Transferor agrees to pay Servicer all such Collections and Recoveries as soon as practicable after receipt thereof but in no event later than two Business Days after the Date of Processing by Transferor.
(e) NOTICE OF LIENS. Transferor shall notify Issuer, Indenture
Trustee and each Enhancement Provider, if any, entitled to such notice pursuant
to the relevant Indenture Supplement promptly after becoming aware of any Lien
on any Receivable other than the conveyances hereunder or Liens permitted under
SECTION 2.5(b).
(f) CONTINUOUS PERFECTION. Transferor shall not change its name, identity or structure in any manner that might cause any financing or continuation statement filed pursuant to this Agreement to be misleading within the meaning of Section 9-402(7) of the UCC (or any other then applicable provision of the UCC) unless Transferor shall have delivered to Issuer at least 30 days prior written notice thereof and, no later than 30 days after making such change, shall have taken all action necessary or advisable to amend such financing statement or continuation statement so that it is not misleading. Transferor shall not change the jurisdiction under whose laws it is organized, its chief executive office or the location of its principal records concerning the Receivables, the Trust Assets or the Collections unless it has delivered to Issuer at least 30 days prior written notice of its intention to do so and has taken such action as is necessary or advisable to cause the interest of Issuer in the Receivables and other Trust Assets to continue to be perfected with the priority required by this Agreement.
(g) CREDIT CARD AGREEMENT AND GUIDELINES. Transferor shall enforce the covenant in the Receivables Purchase Agreement requiring the Credit Card Originator to comply with and perform its obligations under the Credit Card Agreements relating to the Accounts and the Credit Card Guidelines except insofar as any failure to comply or perform would not materially or adversely affect the rights of the Trust or the Holders under any Transaction Document or the Certificates. Transferor may permit the Credit Card Originator to change the terms and provisions of the Credit Card Agreements or the Credit Card Guidelines in any respect (including the reduction of the required minimum monthly payment, the calculation of the amount, or the timing, of charge offs and Periodic Finance Charges and other fees assessed thereon), but only if such change is made applicable to any comparable segment of the revolving credit card accounts owned and serviced by the Credit Card Originator which have characteristics the same as, or substantially similar to, the Accounts that are the subject of such change, except as otherwise restricted by an endorsement, sponsorship or other agreement between the Credit Card Originator and an unrelated third party or by the terms of the Credit Card Agreements.
(h) RECEIVABLES PURCHASE AGREEMENT. Transferor, in its capacity as Purchaser of Receivables from the RPA Seller under the Receivables Purchase Agreement, shall enforce the covenants and agreements of the RPA Seller set forth in such Receivables Purchase Agreement, where a failure of the RPA Seller to comply would have an Adverse Effect.
(i) ACCOUNT ALLOCATIONS. If Transferor is unable for any reason
to transfer Receivables to the Trust in accordance with the provisions of
this Agreement (including by reason of the application of the provisions of
SECTION 6.1 or an order by any Federal governmental agency having regulatory
authority over Transferor or any court of competent jurisdiction that
Transferor not transfer any additional Principal Receivables to the Issuer)
then, in any such event: (A) Transferor agrees to allocate and pay to the
Issuer, after the date of such inability, all Collections with respect to
Principal Receivables, all Discount Option Receivables Collections, and all
amounts which would have constituted Collections with respect to Principal
Receivables and all Discount Option Receivables Collections but for
Transferor's inability to transfer such Receivables (up to an aggregate
amount equal to the amount of Principal Receivables and the Discount Option
Receivables Amount in the Trust on such date); (B) Transferor agrees to have
such amounts applied as Collections in accordance with Article VIII of the
Indenture; and (C) for only so long as all Collections and all amounts which
would have constituted Collections are allocated and applied in accordance
with CLAUSES (A) and (B), Principal Receivables and Discount Option
Receivables (and all amounts which would have constituted Principal
Receivables or Discount Option Receivables, as the case may be, but for
Transferor's inability to transfer Receivables to the Trust) that are charged
off as uncollectible in accordance with this Agreement shall continue to be
allocated in accordance with Article VIII of the Indenture, and all amounts
that would have constituted Principal Receivables or Discount Option
Receivables, as the case may be,
but for Transferor's inability to transfer Receivables to the Trust shall be deemed to be Principal Receivables or Discount Option Receivables, as the case may be, for the purpose of calculating the applicable Allocation Percentage with respect to any Series. If Transferor is unable pursuant to any Requirement of Law to allocate Collections as described above, Transferor agrees that it shall in any such event allocate, after the occurrence of such event, payments on each Account with respect to the principal balance of such Account first to the oldest principal balance of such Account and to have such payments applied as Collections in accordance with Article VIII of the Indenture. The parties hereto agree that Finance Charge Receivables, whenever created, accrued in respect of Principal Receivables that have been conveyed to the Trust, or that would have been conveyed to the Trust but for the above described inability to transfer such Receivables, shall continue to be a part of the Trust notwithstanding any cessation of the transfer of additional Principal Receivables and Discount Option Receivables to the Trust, and Collections with respect thereto shall continue to be allocated and paid in accordance with Article VIII of the Indenture.
(j) PERIODIC FINANCE CHARGES AND OTHER FEES. Transferor hereby agrees that, except as otherwise required by any Requirement of Law, or as is deemed by the Credit Card Originator to be necessary in order for it to maintain its credit card business, based upon the Credit Card Originator's good faith assessment, in its sole discretion, of the nature of the competition in the credit card business, it shall not at any time permit the Credit Card Originator to reduce the Periodic Finance Charges assessed on any Receivable or other fees on any Account if, as a result of such reduction, Transferor's reasonable expectation of the Portfolio Yield for any Series as of such date would be less than the then Base Rate for that Series.
(k) NOTICES OF CERTAIN EVENTS. Transferor shall promptly notify each Rating Agency after Transferor obtains knowledge that: (i) the Welsh, Carson, Anderson & Stowe Partnerships and The Limited and its Affiliates (in the aggregate) fail to own a majority of the outstanding common stock of Holding (PROVIDED that common stock owned by employees, either individually or through employee stock ownership or other stock based benefit plans, shall not be included in the calculation of ownership interests for this purpose); (ii) any Merchant whose program gives rise to more than 10% of the Principal Receivables (measured as of the end of the most recent Monthly Period) terminates its private label credit card program with WFN; (iii) Indenture Trustee gives a resignation notice pursuant to Section 6.8 of the Indenture; or (iv) an Additional Limitation Event or an Automatic Addition Limitation Event occurs.
(l) SALE TREATMENT. Transferor agrees to treat the conveyance hereunder of the Collateral Certificate and the proceeds thereof and the Receivables and the proceeds thereof as a sale for accounting purposes.
(m) AMENDMENT OF THE ORGANIZATIONAL DOCUMENTS. Transferor shall not amend in any material respect its certificate of formation or its limited liability company
agreement without providing the Rating Agencies with notice no later than the fifth Business Day prior to such amendment (unless the right to such notice is waived by the Rating Agency) and satisfying the Rating Agency Condition.
(n) OTHER INDEBTEDNESS. Except as contemplated by the Receivables Purchase Agreement, Transferor shall not incur any additional debt, unless (i) such debt is contemplated by the Transaction Documents or (ii) the Rating Agencies are 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 the Rating Agency) and the Rating Agency Condition is satisfied with respect to the incurrence of such debt.
(o) SEPARATE CORPORATE EXISTENCE. 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 organization 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 Receivables Purchase Agreement and each other instrument or agreement necessary or appropriate to proper administration hereof and permit and effectuate the transactions contemplated hereby.
(ii) Except as provided herein, maintain its own deposit, securities and other account or accounts, separate from those of any Affiliate of Transferor, with financial institutions. The funds of Transferor shall not be diverted to any other Person or for other than the corporate use of Transferor, and, except as may be expressly permitted by this Agreement or the Receivables Purchase Agreement, the funds of Transferor shall not be commingled with those of any other person or entity.
(iii) Ensure that, to the extent that it shares the same officers or other employees as any of its stockholders or Affiliates, the salaries of and the expenses related to providing benefits to such officers and other employees shall be fairly allocated among such entities, and each such entity shall bear its fair share of the salary and benefit costs associated with all such common officers and employees.
(iv) Ensure that, to the extent that it jointly contracts with any of its stockholders or Affiliates to do business with vendors or service providers or to share overhead expenses, the costs incurred in so doing shall be allocated fairly among entities, and each such entity shall bear its fair share of such costs. To the extent that 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. All material transactions between Transferor and any of its Affiliates shall be only on an arm's-length basis and
shall receive the approval of Transferor's Board of Directors including at least one Independent Director (defined below).
(v) Maintain a principal executive and administrative office through which its business is conducted and a telephone number separate from those of its stockholders and Affiliates. To the extent that Transferor and any of its members or 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.
(vi) Conduct its affairs strictly in accordance with its certificate of formation and observe all necessary, appropriate and customary corporate formalities including, but not limited to, holding all regular and special directors' meetings appropriate to authorize all limited liability company 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 directors' meetings shall be held at least annually.
(vii) Ensure that its board of directors shall at all times include at least two Independent Directors (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 or shareholder of any Affiliate which is not a special purpose entity of such Transferor, (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.
(viii) Ensure that decisions with respect to its business and daily operations shall be independently made by Transferor (although the officer making any particular decision may also be an officer or director of an Affiliate of Transferor) and shall not be dictated by any Affiliate of Transferor.
(ix) Act solely in its own legal name and through its own authorized officers and agents, and, except as contemplated by the Transaction Documents, no Affiliate of Transferor shall be appointed to act as agent of Transferor. Transferor shall at all times use its own stationery and business forms and describe itself as a separate legal entity.
(x) Ensure that none of its Affiliates shall advance funds to it, and no Affiliate of Transferor will otherwise guaranty its debts.
(xi) Other than organizational expenses and as expressly provided herein, pay all expenses, indebtedness and other obligations incurred by it using its own funds.
(xii) 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 of its Affiliates.
(xiii) Ensure that any financial reports required of Transferor shall comply with GAAP 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 identifying Transferor as a separate entity and describing the effect of the transactions between Transferor and such Affiliate.
(xiv) Ensure that at all times it is adequately capitalized to engage in the transactions contemplated in its certificate of formation and limited liability company agreement.
Section 2.6 ADDITION OF ACCOUNTS.
(a) AUTOMATIC ADDITIONAL ACCOUNTS. Subject to the limitations specified below in this SECTION 2.6(a) and to any further limitations specified in any Indenture Supplement, Automatic Additional Accounts shall be included as Accounts from and after the date upon which they are created, and all Receivables in Automatic Additional Accounts purchased by Transferor pursuant to the Receivables Purchase Agreement, whether such Receivables are then existing or thereafter created, shall be transferred automatically to the Trust upon their creation. For all purposes of this Agreement, all receivables relating to Automatic Additional Accounts shall be treated as Receivables upon their creation and shall be subject to the eligibility criteria specified in the definitions of "Eligible Receivable" and "Eligible Account." Transferor may elect at any time to terminate the inclusion in Accounts of new accounts which would otherwise be Automatic Additional Accounts as of any Business Day (the "AUTOMATIC ADDITION TERMINATION DATE"), or suspend any such inclusion as of any Business Day (an "AUTOMATIC ADDITION SUSPENSION DATE") until a date (the "RESTART DATE") to be notified in writing by Transferor to Issuer by delivering to Issuer, Indenture Trustee, Servicer and each Rating Agency ten days prior written notice of such election at least 10 days prior to such Automatic Addition Termination Date, Automatic Addition Suspension Date or Restart Date, as the case may be. Promptly after each of an Automatic Addition Termination Date, an Automatic Addition Suspension Date and a Restart Date, Transferor and Issuer agree to execute, and Transferor agrees to record and file at its own expense, an amendment to the financing statements referred to in SECTION 2.1 to specify the accounts then subject to this Agreement (which specification may incorporate a list of accounts by reference) and, except in connection with any such filing made after a Restart Date, to release any security interest in any accounts created after the Automatic Addition Termination Date or Automatic Addition Suspension Date. Notwithstanding
the foregoing, during any period after an Automatic Addition Limitation Event has occurred and before the Rating Agency Condition has been satisfied as to the resumption of treating new accounts as Automatic Additional Accounts, no new accounts that would otherwise be Automatic Additional Accounts shall be treated as such on any Addition Date if the number of such Automatic Additional Accounts would exceed an amount equal to the lesser of:
(i) the excess (if any) of (1) 20% of the aggregate number of Accounts determined as of the first day of the fiscal year of Transferor in which the Addition Date occurs OVER (2) the aggregate amount of Automatic Additional Accounts and Supplemental Accounts the Addition Date for which has occurred since the first day of such fiscal year (including, with respect to the fiscal year in which the Certificate Trust Termination Date occurs, the amount of "Automatic Additional Accounts" and "Supplemental Accounts" under (and as defined in the Pooling and Servicing Agreement), the Addition Date (as defined in the Pooling and Servicing Agreement) for which has occurred since the first day of such fiscal year); and
(ii) the excess (if any) of (1) 15% of the aggregate number of Accounts determined as of the first day of the fiscal quarter of Transferor in which the Addition Date occurs OVER (2) the aggregate amount of Automatic Additional Accounts and Supplemental Accounts the Addition Date for which has occurred since the first day of such fiscal quarter (including, with respect to the fiscal year in which the Certificate Trust Termination Date occurs, the amount of "Automatic Additional Accounts" and "Supplemental Account" under (and as defined in) the Pooling and Servicing Agreement, the Addition Date (as defined in the Pooling and Servicing Agreement) for which has occurred since the first day of such fiscal quarter).
In addition, during any period after an Additional Limitation Event has occurred and before the Rating Agency Condition has been satisfied as to the resumption of treating new accounts as Automatic Additional Accounts, no new accounts that would otherwise be Automatic Additional Accounts shall be treated as such on any Addition Date if:
(i) the aggregate balance of Receivables in Automatic Additional Accounts and Supplemental Accounts designated during a twelve month (or shorter) period beginning on the Additional Limitation Event (or any anniversary thereof) would exceed an amount equal to the excess (if any) of 20% of the aggregate balance of Receivables determined as of the first day after the Additional Limitation Event (or such anniversary); or
(ii) the aggregate balance of Receivables in Automatic Additional Accounts and Supplemental Accounts designated during a three month (or shorter) period beginning on the Additional Limitation Event (or the first day of
the third month commencing thereafter or of any ensuing third month) would exceed 15% of the aggregate balance of Receivables determined as of the first day after the occurrence of the Additional Limitation Event (or the first day of such third month or ensuing third month).
(b) REQUIRED ADDITIONS OF SUPPLEMENTAL ACCOUNTS. On or after the Certificate Trust Termination Date, if during any period of thirty consecutive days, the Transferor Amount averaged over that period is less than the Minimum Transferor Amount for that period, Transferor shall designate additional Eligible Accounts ("SUPPLEMENTAL ACCOUNTS") to be included as Accounts in a sufficient amount such that the average of the Transferor Amount for such 30-day period, computed by assuming that the amount of the Principal Receivables of such Supplemental Accounts shall be deemed to be outstanding in the Trust during each day of such 30-day period, is at least equal to the Minimum Transferor Amount. For purposes of the preceding sentence, the terms "Transferor Amount" and "Minimum Transferor Amount" shall have the meanings ascribed to such terms as set forth in the Pooling and Servicing Agreement with respect to any day falling in the period prior to the Certificate Trust Termination Date. In addition, if on any Business Day on or after the Certificate Trust Termination Date, the Aggregate Principal Balance is less than the Required Principal Balance, Transferor shall designate Supplemental Accounts from any Approved Portfolio to be included as Accounts in a sufficient amount such that the Aggregate Principal Balance will be equal to or greater than the Required Principal Balance. Receivables from all such Supplemental Accounts shall be transferred to the Trust on or before the fifth Business Day following such thirty-day period or Business Day, as the case may be. In lieu of, or in addition to, designating Supplemental Accounts as required above, Transferor may convey to the Trust participations or trust certificates representing undivided legal or beneficial interests in a pool of assets primarily consisting of receivables arising under revolving credit card accounts or other revolving credit accounts owned by Transferor or any of its Affiliates and collections thereon ("PARTICIPATION INTERESTS"). Any addition of Participation Interests to the Trust (whether pursuant to this PARAGRAPH (b) or PARAGRAPH (c) below) shall be effected by an amendment hereto, dated the applicable Addition Date, pursuant to SUBSECTION 9.1(a).
(c) PERMITTED ADDITIONS. In addition to its obligation under PARAGRAPH (b), on or after the Certificate Trust Termination Date Transferor may, but shall not be obligated to, from time to time designate Supplemental Accounts or Participation Interests to be included as Trust Assets, in either case as of the applicable Addition Date, so long as after giving effect to such addition no more than 20% of the Receivables, by outstanding balance, will be 30 or more days delinquent.
(d) CERTAIN CONDITIONS FOR ADDITIONS OF SUPPLEMENTAL ACCOUNTS AND PARTICIPATION INTERESTS. Transferor agrees that any transfer of Receivables from Supplemental Accounts or Participation Interests under PARAGRAPHS (b) or (C) shall occur only upon satisfaction of the following conditions (to the extent applicable):
(i) on or before the tenth Business Day prior to the Addition Date (the "NOTICE DATE"), Transferor shall give Issuer, Indenture Trustee, each Rating Agency and Servicer written notice that such Supplemental Accounts or Participation Interests will be included, which notice shall specify the approximate aggregate amount of the Receivables or Participation Interests to be transferred; and, in the case of any transfer pursuant to PARAGRAPH (c), the Rating Agency Condition shall have been satisfied;
(ii) on or before the Addition Date, Transferor shall have delivered to Issuer a written assignment (including an acceptance by Issuer) in substantially the form of EXHIBIT A (the "ASSIGNMENT") and the Credit Card Originator shall have indicated in its computer files that the Receivables created in connection with the Supplemental Accounts have been transferred to Issuer and, within five Business Days thereafter, Transferor shall have delivered to Issuer an Account Schedule listing such Supplemental Accounts, which as of the date of such Assignment, shall be deemed incorporated into and made a part of such Assignment and this Agreement;
(iii) Transferor shall represent and warrant that (x) each Supplemental Account is, as of the Addition Date, an Eligible Account, and each Receivable in such Supplemental Account is, as of the Addition Cut Off Date, an Eligible Receivable, (y) no selection procedures believed by Transferor to be materially adverse to the interests of the Noteholders were utilized in selecting the Additional Accounts from the available Eligible Accounts in an Approved Portfolio, and (z) as of the Addition Date, Transferor is not insolvent;
(iv) Transferor shall represent and warrant that, as of
the Addition Date, the Assignment constitutes either (x) a valid
transfer and assignment to the Trust of all right, title and interest
of Transferor in and to the Receivables then existing and thereafter
created in the Supplemental Accounts, and all proceeds of such
Receivables and Insurance Proceeds relating thereto and such
Receivables and all proceeds thereof and Insurance Proceeds and
Recoveries relating thereto will be held by the Trust free and clear of
any Lien of any Person claiming through or under Transferor or any of
its Affiliates, except for (i) Liens permitted under SECTION 2.5(b),
(ii) the interest of the Holders of the Transferor Interest and (iii)
Transferor's right to receive interest accruing on, and investment
earnings in respect of, the Excess Funding Account, or any Series
Account as provided in this Agreement, the Indenture and any Indenture
Supplement or (y) a grant of a security interest in such property to
Issuer, which is enforceable with respect to then existing Receivables
in the Supplemental Accounts, the proceeds thereof and Insurance
Proceeds and Recoveries
relating thereto upon the conveyance of such Receivables to the Trust,
and which will be enforceable with respect to the Receivables
thereafter created in respect of Supplemental Accounts conveyed on such
Addition Date, the proceeds thereof and Insurance Proceeds and
Recoveries relating thereto upon such creation; and (z) if the
Assignment constitutes the grant of a security interest to Issuer in
such property, upon the filing of a financing statement as described in
SECTION 2.1 with respect to such Supplemental Accounts and in the case
of the Receivables thereafter created in such Supplemental Accounts and
the proceeds thereof, and Insurance Proceeds and Recoveries relating
thereto, upon such creation, the Trust shall have a first priority
perfected security interest in such property (subject to Section 9-306
of the UCC), except for Liens permitted under SECTION 2.5(b);
(v) Transferor shall deliver an Officer's Certificate to Indenture Trustee confirming the items set forth in CLAUSE (ii); and
(vi) Transferor shall deliver an Opinion of Counsel with respect to the Receivables in the Supplemental Accounts to Indenture Trustee (with a copy to each Rating Agency) substantially in the form of EXHIBIT D-2.
(e) ADDITIONAL APPROVED PORTFOLIOS. On and after the Certificate Trust Termination Date, Transferor may from time to time designate additional portfolios of accounts as "Approved Portfolios" if the Rating Agency Condition is satisfied with respect to that designation (except as to any Series or Class that expressly waives this requirement in the applicable Indenture Supplement). Transferor agrees that prior to any transfer of Receivables from Automatic Additional Accounts arising in a portfolio that is designated as an Approved Portfolio pursuant to the immediately preceding sentence Transferor shall satisfy the following requirements:
(i) on or before the tenth Business Day prior to the Addition Date, Transferor shall give Issuer, Indenture Trustee, each Rating Agency and Servicer written notice that such Automatic Additional Accounts will be included;
(ii) on or before the Addition Date, Transferor shall have delivered to Issuer a written Assignment (including an acceptance by Issuer) substantially in the form of EXHIBIT A (with appropriate modifications) and the Credit Card Originator shall have indicated in its computer files that the Receivables created in connection with the Automatic Additional Accounts have been transferred to the Trust;
(iii) Transferor shall represent and warrant that (x) each Automatic Additional Account is, as of the Addition Date, an Eligible Account, and each Receivable in such Automatic Additional Account is, as of the Addition Date, an Eligible Receivable, (y) no selection procedures believed by Transferor to be materially adverse to the interests of the Noteholders were utilized in selecting the new Approved Portfolio, and (z) as of the Addition Date, Transferor is not insolvent;
(iv) Transferor shall represent and warrant that, as of
the Addition Date, the Assignment constitutes either (x) a valid
transfer and assignment to the Trust of all right, title and interest
of Transferor in and to the Receivables then existing and thereafter
created in the Automatic Additional Accounts, and all proceeds of such
Receivables and Insurance Proceeds relating thereto and such
Receivables and all proceeds thereof and Insurance Proceeds and
Recoveries relating thereto will be held by the Trust free and clear of
any Lien of any Person claiming through or under Transferor or any of
its Affiliates, except for (i) Liens permitted under SECTION 2.5(b),
(ii) the interest of the Holders of the Transferor Interest and (iii)
Transferor's right to receive interest accruing on, and investment
earnings in respect of, the Excess Funding Account, or any Series
Account as provided in this Agreement, the Indenture and any Indenture
Supplement or (y) a grant of a security interest in such property to
Issuer, which is enforceable with respect to then existing Receivables
in the Automatic Additional Accounts, the proceeds thereof and
Insurance Proceeds and Recoveries relating thereto upon the conveyance
of such Receivables to the Trust, and which will be enforceable with
respect to the Receivables thereafter created in respect of Automatic
Additional Accounts conveyed on such Addition Date, the proceeds
thereof and Insurance Proceeds and Recoveries relating thereto upon
such creation; and (z) if the Assignment constitutes the grant of a
security interest to Issuer in such property, upon the filing of a
financing statement as described in SECTION 2.1 with respect to such
Automatic Additional Accounts and in the case of the Receivables
thereafter created in such Automatic Additional Accounts and the
proceeds thereof, and Insurance Proceeds and Recoveries relating
thereto, upon such creation, the Trust shall have a first priority
perfected security interest in such property (subject to Section 9-306
of the UCC), except for Liens permitted under SECTION 2.5(b);
(v) Transferor shall deliver an Officer's Certificate to Indenture Trustee confirming the items set forth in CLAUSE (ii); and
(vi) Transferor shall deliver an Opinion of Counsel with respect to the Receivables in the Automatic Additional Accounts to Indenture Trustee (with a copy to each Rating Agency) substantially in the form of EXHIBIT D-2 (with appropriate modifications).
Section 2.7 REMOVAL OF ACCOUNTS.
(a) On any day of any Monthly Period after the Certificate Trust Termination Date, 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 moneys due or to become due and all amounts received with respect thereto and all proceeds thereof in or with respect to the Accounts then owned by the Credit Card Originator and designated by Transferor (the "REMOVED ACCOUNTS") or
Participation Interests (unless otherwise set forth in the applicable Indenture Supplement), upon satisfaction of the following conditions:
(i) on or before the tenth Business Day immediately preceding the Removal Date (the "REMOVAL NOTICE DATE") Transferor shall have given Issuer, Servicer, each Rating Agency and any Enhancement Provider entitled thereto pursuant to the relevant Indenture Supplement written notice of such removal and specifying the date for removal of the Removed Accounts and Participation Interests (the "REMOVAL DATE"); Transferor shall provide each Rating Agency with such additional information relating to such removal as the Rating Agency shall reasonably request;
(ii) with respect to Removed Accounts, on or prior to the date that is 10 Business Days after the Removal Date, Transferor shall have delivered to Issuer an Account Schedule listing the Removed Accounts and specifying for each such Account, as of the Removal Notice Date, its account number, the aggregate amount outstanding, and the aggregate amount of Principal Receivables outstanding in such Account;
(iii) with respect to Removed Accounts, Transferor shall have represented and warranted as of the Removal Date that the list of Removed Accounts delivered pursuant to PARAGRAPH (ii), as of the Removal Date, is true and complete in all material respects;
(iv) with respect to any removal pursuant to SECTION 2.7(b) that is being made as a result of the applicable Merchant exercising a purchase right as to which Transferor has no reasonable control (an "INVOLUNTARY REMOVAL"), Transferor shall use reasonable efforts to satisfy the Rating Agency Condition; and as to any other removal, the Rating Agency Condition shall have been satisfied;
(v) Transferor shall have delivered to Indenture Trustee
and any Enhancement Provider entitled thereto pursuant to the relevant
Indenture Supplement an Officer's Certificate, dated as of the Removal
Date, to the effect that Transferor reasonably believes that (A) in the
case of any removal other than an Involuntary Removal, such removal
will not, based on the facts known to such officer at the time of such
certification, then or thereafter cause an Early Amortization Event to
occur with respect to any Series, (B) in the case of any Involuntary
Removal, Transferor has used reasonable efforts to avoid having such
removal result in an Early Amortization Event and (C) in either case,
(i) no selection procedure believed by Transferor to be materially
adverse to the interests of the Noteholders has been used in removing
Removed Accounts from among any pool of Accounts or Participation
Interests of a similar type (it being understood that Transferor will
not be deemed to have used such an adverse selection procedure in
connection with any Involuntary Removal); and (ii)
Accounts (or administratively convenient groups of Accounts, such as billing cycles) were chosen for removal on a random basis or another basis that Transferor believes is consistent which achieving derecognition of the Receivables under GAAP;
(vi) in the case of any removal pursuant to SECTION 2.7(a), the aggregate Principal Receivables in the Removed Accounts shall not exceed the lesser of (A) the excess of the Transferor Amount over the Minimum Transferor Amount or (B) the excess of the Aggregate Principal Balance over the Required Principal Balance, all measured as of the end of the most recently ended Monthly Period;
(vii) in the case of any removal pursuant to SECTION 2.7(b), the removal shall not cause the Transferor Amount to be less than the Minimum Transferor Amount or cause the Aggregate Principal Balance to be less than the Required Principal Balance; and
(viii) such removal shall not cause a decrease in the sum of the Collateral Amounts for all outstanding Series.
Upon satisfaction of the above conditions, Issuer shall execute and deliver to Transferor or its designee a written reassignment in substantially the form of EXHIBIT B (the "REASSIGNMENT") and shall, without further action, be deemed to transfer, assign, set over and otherwise convey to 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 or the Participation Interests, all moneys due and to become due and all amounts received with respect thereto and all proceeds thereof. In addition, Issuer shall execute such other documents and instruments of transfer or assignment and take such other actions as shall reasonably be requested by Transferor to effect the conveyance of Receivables pursuant to this Section.
(b) After the Certificate Trust Termination Date, Transferor may from time to time designate as Removed Accounts any Accounts designated for purchase by a Merchant pursuant to the terms of the related Credit Card Processing Agreement. Any repurchase of the Receivables in Removed Accounts designated pursuant to this SECTION 2.7(b) shall be effected in the manner and at a price determined in accordance with SECTION 2.4(e), as if the Receivables being repurchased were Ineligible Receivables. Amounts deposited in the Collection Account in connection therewith shall be deemed to be Collections of Principal Receivables and shall be applied in accordance with the terms of Article VIII of the Indenture and each Indenture Supplement.
Section 2.8 DISCOUNT OPTION. (a) Transferor shall have the option to designate at any time a fixed or floating percentage (the "DISCOUNT PERCENTAGE") of the amount of Receivables arising in the Accounts on or after the date such designation becomes effective that would otherwise constitute Principal Receivables (prior to subtracting from
Principal Receivables, Finance Charge Receivables that are Discount Option Receivables) to be treated as Finance Charge Receivables. Transferor may from time to time increase (subject to the limitations described below), reduce or eliminate the Discount Percentage for Discount Option Receivables arising in the Accounts on and after the date of such change. Transferor must provide 30 days' prior written notice to Servicer, Issuer, Indenture Trustee and each Rating Agency of any such increase, reduction or elimination, and such increase, reduction or elimination shall become effective on the date specified therein only if (i) Transferor has delivered to Indenture Trustee an Officer's Certificate to the effect that, based on the facts known to such officer at the time, Transferor reasonably believes that such increase, reduction or elimination will not at the time of its occurrence cause an Early Amortization Event, or an event which with notice or the lapse of time would constitute an Early Amortization Event, to occur with respect to any Series and (ii) in the case of any increase, the Discount Percentage shall not exceed 3% after giving effect to that increase, unless the Rating Agency Condition has been satisfied with respect to the increase.
(b) On each Date of Processing after the date on which Transferor's exercise of its discount option takes effect, Transferor shall treat Discount Option Receivables Collections as Collections of Finance Charge Receivables.
Section 2.9 ADDITIONAL TRANSFERORS. Transferor may designate additional or substitute Persons to be included as Transferors under this Agreement by an amendment to this Agreement (which amendment shall be subject to SECTION 9.1, any applicable restrictions in the Indenture Supplement for any outstanding Series and satisfaction of the Rating Agency Condition) and in connection with such designation, the initial Transferor shall transfer a portion of the Transferor Interest to such additional Transferor reflecting such additional Transferor's interest in the Transferor Interest; PROVIDED that prior to any such designation and issuance the conditions set forth in Section 3.4(b) of Trust Agreement shall have been satisfied with respect to a transfer of Transferor's Interest.
Section 2.10 ADDITIONAL CREDIT CARD ORIGINATORS. Transferor may designate additional Persons as Credit Card Originators under this Agreement by an amendment to this Agreement (which amendment shall be subject to SECTION 9.1, satisfaction of the Rating Agency condition and any applicable restrictions in the Indenture Supplement for any outstanding Series).
ARTICLE III
ADMINISTRATION AND SERVICING OF RECEIVABLES
Prior to the Certificate Trust Termination Date, the Receivables shall be serviced as provided in the Pooling and Servicing Agreement, and this ARTICLE III will have no effect. On and after the Certificate Trust Termination Date:
Section 3.1 ACCEPTANCE OF APPOINTMENT AND OTHER MATTERS RELATING TO SERVICER.
(a) WFN agrees to act as Servicer under this Agreement. The Noteholders by their acceptance of the Notes consent to WFN acting as Servicer.
(b) Subject to the provisions of this Agreement, Servicer shall service and administer the Receivables, shall collect payments due under the Receivables and shall charge off as uncollectible Receivables, all in accordance with its customary and usual servicing procedures for servicing credit card and other consumer open end credit receivables comparable to the Receivables and in accordance with the Credit Card Guidelines. 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, subject to SECTION 7.1, and provided WFN is Servicer, Servicer or its designee (rather than Indenture Trustee or Owner Trustee) is hereby authorized and empowered (i) to make withdrawals from the Collection Account and any Series Account, as set forth in this Agreement, the Indenture or any Indenture Supplement, (ii) to instruct Indenture Trustee to make withdrawals and payments from the Collection Account and any Series Accounts in accordance with such instructions as set forth in this Agreement, the Indenture or any Indenture Supplement, (iii) to instruct Indenture Trustee in writing as provided herein, (iv) to take any action required or permitted under any Enhancement, as set forth in this Agreement, the Indenture or any Indenture Supplement and (v) to execute and deliver, on behalf of Issuer for the benefit of the Noteholders, any and all instruments of satisfaction or cancellation, or of partial or full release or discharge, and all other comparable instruments, with respect to the Receivables and, after the delinquency of any Receivable and to the extent permitted under and in compliance with applicable law and regulations, to commence enforcement proceedings with respect to such Receivables. Without limiting the generality of the foregoing and subject to SECTION 7.1, Servicer or its designee is authorized and empowered to make any filings, reports, notices, applications and registrations with, and to seek any consents or authorizations from, 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 laws or reporting requirements. Indenture Trustee shall furnish Servicer with any powers of attorney or other documents necessary or appropriate to enable Servicer to carry out its servicing and administrative duties hereunder. Owner Trustee shall furnish Servicer with any powers of attorney and other documents necessary or appropriate to enable Servicer to carry out its servicing and administrative duties hereunder.
(c) Servicer shall not be obligated to use separate servicing procedures, offices, employees or accounts for servicing the Receivables from the procedures, offices, employees and accounts used by Servicer in connection with servicing other credit card receivables.
(d) Servicer shall comply with and perform its servicing obligations with respect to the Accounts and Receivables in accordance with the Credit Card Agreements relating to the Accounts and the Credit Card Guidelines except insofar as any failure to so comply or perform would not materially and adversely affect the Trust or the Noteholders.
(e) Servicer shall be liable for the payment, without reimbursement, of all expenses incurred in connection with the Trust and the servicing activities hereunder including expenses related to enforcement of the Receivables, fees and disbursements of Owner Trustee that are due and payable to it under Article 7 of the Trust Agreement, Indenture Trustee, the Administrator, any Paying Agent and any Transfer Agent and Registrar (including the reasonable fees and expenses of its counsel), fees and disbursements of independent accountants and all other fees and expenses, including the costs of filing UCC continuation statements and the costs and expenses relating to obtaining and maintaining the listing of any Notes on any stock exchange, that are not expressly stated in this Agreement to be payable by the Trust, the Noteholders of a Series or Transferor (other than Federal, state, local and foreign income, franchise and other taxes, if any, or any interest or penalties with respect thereto, assessed on the Trust).
(f) Servicer shall maintain fidelity bond or other appropriate insurance coverage insuring against losses through wrongdoing of its officers and employees who are involved in the servicing of credit card receivables covering such actions and in such amounts as Servicer believes to be reasonable from time to time.
Section 3.2 SERVICING COMPENSATION. As full compensation for its servicing activities hereunder and as reimbursement for any expense incurred by it in connection therewith, Servicer shall be entitled to receive a servicing fee (the "SERVICING FEE") with respect to each Monthly Period after the Certificate Trust Termination Date, payable monthly on the related Distribution Date, in an amount equal to one-twelfth of the product of (a) the weighted average of the Series Servicing Fee Percentages with respect to each outstanding Series (based upon the Series Servicing Fee Percentage for each Series and the Collateral Amount (or such other amount as specified in the related Indenture Supplement) of such Series, in each case as of the last day of the prior Monthly Period) and (b) the amount of Principal Receivables on the last day of the prior Monthly Period. The share of the Servicing Fee allocable to each Series with respect to any Monthly Period (the "NOTEHOLDER SERVICING FEE") will be determined in accordance with the relevant Indenture Supplement. The portion of the Servicing Fee with respect to any Monthly Period not so allocated to a particular Series, or otherwise allocated in any Indenture Supplement, shall be paid from Finance Charge Collections allocable to Transferor on the related Distribution Date. In no event shall Issuer, Indenture Trustee, the Noteholders of any Series or any Enhancement Provider be liable for the share of the Servicing Fee with respect to any Monthly Period allocable to the Transferor Amount.
Section 3.3 REPRESENTATIONS, WARRANTIES AND COVENANTS OF SERVICER. WFN, as initial Servicer, hereby makes, and any successor Servicer by its appointment hereunder shall make, on each Closing Date (and on the date of any such appointment) the following representations and warranties and covenants to Issuer on which Owner Trustee has relied in accepting the Receivables in trust, Owner Trustee has relied in executing the Notes and Indenture Trustee has relied in authenticating Notes:
(a) ORGANIZATION AND GOOD STANDING. Servicer is a national banking association (or with respect to such Successor Servicer, such other corporate entity as may be applicable) duly organized, validly existing and in good standing under the laws of the United States, and has full corporate power, authority and legal right to execute, deliver and perform its obligations under this Agreement and, in all material respects, to own its properties and conduct its business as such properties are presently owned and as such business is presently conducted.
(b) DUE QUALIFICATION. Servicer is duly qualified to do business and is in good standing as a foreign corporation (or is exempt from such requirements), and has obtained all necessary licenses and approvals in each jurisdiction in which failure to so qualify or to obtain such licenses and approvals would have a material adverse effect on the interests of the Noteholders.
(c) DUE AUTHORIZATION. The execution, delivery, and performance of this Agreement have been duly authorized by Servicer by all necessary corporate action on the part of Servicer.
(d) BINDING OBLIGATION. This Agreement constitutes a legal, valid and binding obligation of Servicer, enforceable against Servicer in accordance with its terms, except as enforceability may be limited by applicable Debtor Relief Laws now or hereafter in effect (or with respect to such Successor Servicer, such other corporate entity as may be applicable) and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity).
(e) NO VIOLATION. The execution and delivery of this Agreement by Servicer, the performance of the transactions contemplated by this Agreement and the other Transaction Documents and the fulfillment of the terms hereof and thereof applicable to Servicer, will not conflict with, violate, result in any breach of any of the material terms and provisions of, or constitute (with or without notice or lapse of time or both) a material default under, any Requirement of Law applicable to Servicer or any indenture, contract, agreement, mortgage, deed of trust or other instrument to which Servicer is a party or by which it or any of its properties are bound.
(f) NO PROCEEDINGS. There are no proceedings or investigations pending or, to the best knowledge of Servicer, threatened against Servicer before any court, regulatory body, administrative agency or other tribunal or governmental instrumentality seeking to prevent the issuance of the Notes or the consummation of any of the transactions
contemplated by this Agreement and the other Transaction Documents, seeking any determination or ruling that, in the reasonable judgment of Servicer, would materially and adversely affect the performance by Servicer of its obligations under this Agreement and the other Transaction Documents, or seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Agreement and the other Transaction Documents.
(g) COMPLIANCE WITH REQUIREMENTS OF LAW. Servicer shall duly satisfy all obligations on its part to be fulfilled under or in connection with the Receivables and the related Accounts, will maintain in effect all qualifications required under Requirements of Law in order to properly service the Receivables and the related Accounts and will comply in all material respects with all other Requirements of Law in connection with servicing the Receivables and the related Accounts, the failure to comply with which would have a material adverse effect on the interests of the Noteholders.
(h) NO RESCISSION OR CANCELLATION. Servicer shall not permit any rescission or cancellation of a Receivable except as ordered by a court of competent jurisdiction or other Governmental Authority or in the ordinary course of its business and in accordance with the Credit Card Guidelines. Servicer shall reflect any such rescission or cancellation in its computer file of revolving credit card accounts. In addition, Servicer may waive the accrual and/or payment of certain Finance Charge Receivables in respect of certain past due Accounts, the Obligors of which have enrolled with a consumer credit counseling service, and the Receivables in such Accounts shall not fail to be Eligible Receivables solely as a result of such waiver.
(i) PROTECTION OF HOLDERS' RIGHTS. Servicer shall take no action which, nor omit to take any action the omission of which, would materially impair the rights of Holders in any Receivable or Account, nor shall it, except in the ordinary course of its business and in accordance with the Credit Card Guidelines, reschedule, revise or defer Collections due on the Receivables.
(j) RECEIVABLES NOT TO BE EVIDENCED BY PROMISSORY NOTES. Except in connection with its enforcement or collection of an Account, Servicer will take no action to cause any Receivable to be evidenced by any instrument, other than an instrument that, taken together with one or more other writings, constitutes chattel paper and, if any Receivable is so evidenced (whether or not in connection with the enforcement or collection of an Account), it shall be reassigned or assigned to Servicer as provided in this Section.
(k) ALL CONSENTS REQUIRED. All approvals, authorizations, consents, orders or other actions of any Person or of any governmental body or official required in connection with the execution and delivery by Servicer of this Agreement, the performance by Servicer of the transactions contemplated by this Agreement and the other Transaction Documents and the fulfillment by Servicer of the terms hereof and
thereof have been obtained; PROVIDED that Servicer makes no representation or warranty as to state securities or "blue sky" laws.
(l) MAINTENANCE OF RECORDS AND BOOKS OF ACCOUNT. Servicer shall maintain and implement administrative and operating procedures (including the ability to recreate records evidencing the Receivables in the event of the destruction of the originals thereof), and keep and maintain all documents, books, computer records and other information, reasonably necessary or advisable for the collection of all the Receivables. Such documents, books and computer records shall reflect all facts giving rise to the Receivables, all payments and credits with respect thereto, and, to the extent required pursuant to SECTION 2.1, such documents, books and computer records shall indicate the interests of Issuer in the Receivables.
As of the Certificate Trust Termination Date, Servicer agrees that all representations and warranties made by it in its capacity as Servicer under the Pooling and Servicing Agreement with respect to any Account or Receivable pursuant to Section 3.3 of the Pooling and Servicing Agreement shall be deemed for all purposes to have been made by Servicer to Issuer pursuant to this Agreement as of the day when each was made or deemed made, as if this Agreement had been in effect on that day.
After the Certificate Trust Termination Date, if any of the
representations, warranties or covenants of Servicer contained in PARAGRAPH (g),
(h), (i) or (j) of this SECTION 3.3 or PARAGRAPHS (g) (h), (i) or (j) of Section
3.3 of the Pooling and Servicing Agreement with respect to any Receivable or the
related Account is breached, and as a result of such breach Issuer's rights in,
to or under any Receivables in the related Account or the proceeds of such
Receivables are materially impaired or such proceeds are not available for any
reason to Issuer free and clear of any Lien, then no later than the expiration
of 60 days (or such longer period, not in excess of 150 days, as may be agreed
to by Trustee) from the earlier to occur of the discovery of such event by
Servicer, or receipt by Servicer of notice of such event given by Indenture
Trustee, all Receivables in the Account or Accounts to which such event relates
shall be reassigned or assigned to Servicer as set forth below; PROVIDED that
such Receivables will not be reassigned or assigned to Servicer if, on any day
prior to the end of such 60-day or longer period, (i) the relevant
representation and warranty shall be true and correct, or the relevant covenant
shall have been complied with, in all material respects and (ii) Servicer shall
have delivered an Officer's Certificate describing the nature of such breach and
the manner in which such breach was cured.
Servicer shall effect such assignment by making a deposit into the Collection Account in immediately available funds prior to the next succeeding Business Day in an amount equal to the amount of such Receivables, which deposit shall be considered a Collection with respect to such Receivables and shall be applied in accordance with Article VIII of the Indenture and each Indenture Supplement.
Upon each such assignment to Servicer, Issuer shall automatically and without further action be deemed to transfer, assign, set over and otherwise convey to Servicer, without recourse, representation or warranty all right, title and interest of Issuer in and to such Receivables, all moneys due or to become due and all amounts received with respect thereto and all proceeds thereof. Issuer shall execute such documents and instruments of transfer or assignment and take such other actions as shall be reasonably requested by Servicer to effect the conveyance of any such Receivables pursuant to this Section. The obligation of 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 Issuer, Owner Trustee, Holders (or Indenture Trustee on behalf of the Noteholders) or any Enhancement Provider.
Section 3.4 REPORTS AND RECORDS FOR INDENTURE TRUSTEE.
(a) DAILY REPORTS. On the second Business Day immediately
following each Date of Processing, Servicer shall prepare and make available at
the office of Servicer for inspection by Indenture Trustee a report (the "DAILY
REPORT") that shall set forth (i) the aggregate amounts of Collections,
Collections with respect to Principal Receivables and Collections with respect
to Finance Charge Receivables processed by Servicer on such Date of Processing,
(ii) the aggregate amount of Defaulted Receivables for such Date of Processing,
and (iii) the aggregate amount of Principal Receivables in the Receivables Trust
as of such Date of Processing.
(b) MONTHLY SERVICER'S CERTIFICATE. Unless otherwise stated in any
Indenture Supplement as to the related Series, on each Determination Date,
Servicer shall forward to Indenture Trustee, the Paying Agent, each Rating
Agency and each Enhancement Provider, if any, a certificate of a Servicing
Officer setting forth (i) the aggregate amounts for the preceding Monthly Period
with respect to each of the items specified in CLAUSE (i) of SECTION 3.4(a),
(ii) the aggregate Defaulted Receivables and Recoveries for the preceding
Monthly Period, (iii) a calculation of the Portfolio Yield and Base Rate for
each Series then outstanding, (iv) the aggregate amount of Receivables and the
balance on deposit in the Collection Account (or any subaccount thereof) or any
Series Account applicable to any Series then outstanding with respect to
Collections processed as of the end of the last day of the preceding Monthly
Period, (v) the aggregate amount of adjustments from the preceding Monthly
Period, (vi) the aggregate amount, if any, of withdrawals, drawings or payments
under any Enhancement with respect to each Series required to be made with
respect to the previous Monthly Period, (vii) the sum of all amounts payable to
the Noteholders on the succeeding Distribution Date in respect of interest and
principal payable with respect to the Notes and (viii) such other amounts,
calculations, and/or information as may be required by any relevant Indenture
Supplement.
(c) TRANSFERRED ACCOUNTS. Servicer covenants and agrees hereby to deliver to Indenture Trustee, on or prior to the Automatic Addition Termination Date or any Automatic Addition Suspension Date (but in the latter case, prior to a Restart Date) within a reasonable time period after any Transferred Account is created, but in any event not later than 15 days after the end of the month within which the Transferred Account is created, a notice specifying the new account number for any Transferred Account and the replaced account number.
Section 3.5 ANNUAL SERVICER'S CERTIFICATE. Unless Servicer has been relieved of all of its obligations under this Agreement because the final Series has been repaid during the prior calendar year, Servicer shall deliver to Indenture Trustee, any Enhancement Provider and any Rating Agency on or before the 90th day following the end of Servicer's fiscal year in which the Certificate Trust Termination Date occurs and each subsequent fiscal year, an Officer's Certificate substantially in the form of EXHIBIT C.
Section 3.6 ANNUAL INDEPENDENT PUBLIC ACCOUNTANTS' SERVICING REPORT.
(a) On or before the 90th day following the end of Servicer's fiscal year in which the Certificate Trust Termination Date occurs and each subsequent fiscal year, Servicer shall cause a firm of nationally recognized independent public accountants (who may also render other services to Servicer, the Credit Card Originator or Transferor) to furnish a report (addressed to Indenture Trustee) to Indenture Trustee, Servicer and each Rating Agency to the effect that they have applied certain procedures with Servicer and such firm has examined certain documents and records relating to the servicing of Accounts under this Agreement, compared the information contained in Servicer's certificates delivered pursuant to this Agreement during the period covered by such report with such documents and records and that, on the basis of such agreed upon procedures (and assuming the accuracy of any reports generated by Servicer's third party agents), such servicing was conducted in compliance with this Agreement during the period covered by such report (which shall be the prior fiscal year, or the portion thereof falling after the Certificate Trust Termination Date), except for such exceptions, errors or irregularities as such firm shall believe to be immaterial and such other exceptions, errors or irregularities as shall be set forth in such report. Such report shall set forth the agreed upon procedures performed. A copy of such report shall be delivered to each Enhancement Provider, if any, entitled thereto pursuant to the relevant Indenture Supplement.
(b) On or before the 90th day following the end of Servicer's fiscal year in which the Certificate Trust Termination Date occurs and each subsequent fiscal year, Servicer shall cause a firm of nationally recognized independent public accountants (who may also render other services to Servicer, Credit Card Originator or Transferor) to furnish a report to Indenture Trustee, Servicer and each Rating Agency to the effect that they have applied certain procedures agreed upon with Servicer to compare the
mathematical calculations of certain amounts set forth in Servicer's Certificates delivered pursuant to SECTION 3.4(c) during the period covered by such report with Servicer's computer reports which were the source of such amounts and that on the basis of such agreed upon procedures and comparison, such amounts are in agreement, except for such exceptions as they believe to be immaterial and such other exceptions as shall be set forth in such statement. A copy of such report shall be delivered to each Enhancement Provider, if any, entitled thereto pursuant to the relevant Indenture Supplement.
(c) A copy of each certificate and report provided pursuant to
SECTION 3.4(b), 3.5 or 3.6 or the corresponding section of the Pooling and
Servicing Agreement may be obtained by any Noteholder or Note Owner by a request
to Indenture Trustee addressed to the Corporate Trust Office.
(d) In the event such firm rendering a report under this SECTION 3.6 requires Indenture Trustee to agree to the procedures performed by such firm, Servicer shall direct Indenture Trustee in writing to so agree; it being understood and agreed that Indenture Trustee will deliver such letter of agreement in conclusive reliance upon the direction of Servicer, and Indenture Trustee makes no independent inquiry or investigation as to, and shall have no obligation or liability in respect of, the sufficiency, validity or correctness of such procedures.
Section 3.7 TAX TREATMENT. Transferor has structured this Agreement and the Notes to facilitate a secured, credit-enhanced financing on favorable terms with the intention that the Notes will constitute indebtedness of Transferor for federal income and state and local income and franchise tax purposes; and Transferor and each Noteholder by acceptance of its Note (and each Note Owner, by its acceptance of an interest in the applicable Note) agrees to recognize and report the Notes as indebtedness of Transferor for purposes of federal, state and local income and franchise taxes and any other tax imposed on or measured by gross or net income, and to report all receipts and payments relating thereto in a manner that is consistent with such characterization.
Section 3.8 NOTICES TO TRANSFEROR. If WFN is no longer acting as Servicer, any Successor Servicer appointed pursuant to SECTION 7.2 shall deliver or make available to Transferor each certificate and report required to be prepared, forwarded or delivered thereafter pursuant to SECTIONS 3.4(b), 3.5 and 3.6.
Section 3.9 ADJUSTMENTS.
(a) If Servicer adjusts downward the amount of any Receivable because of a rebate, refund, unauthorized charge or billing error to an accountholder, or because such Receivable was created in respect of merchandise which was refused or returned by an accountholder, or if Servicer otherwise adjusts downward the amount of any Receivable without receiving Collections therefor or charging off such amount as uncollectible, then, in any such case, the amount of Principal Receivables used to calculate the Transferor Amount or the Allocation Percentages applicable to any Series will be reduced by the
amount of the adjustment. Similarly, the amount of Principal Receivables used to calculate the Transferor Amount and the Allocation Percentages applicable to any Series will be reduced by the amount of any Principal Receivable which was discovered as having been created through a fraudulent or counterfeit charge or with respect to which the covenant of Transferor contained in SECTION 2.5(b) has been breached. Any adjustment required pursuant to either of the two preceding sentences shall be made on the first Business Day after the Date of Processing for the event giving rise to such adjustment. If, following the exclusion of such Principal Receivables from the calculation of the Transferor Amount, the Transferor Amount would be less than the Specified Transferor Amount, not later than the close of business on such first Business Day, Transferor shall make a deposit into the Excess Funding Account in immediately available funds in an amount equal to the amount by which the Transferor Amount would be less than the Specified Transferor Amount (up to the amount of such Principal Receivables). Any amount deposited into the Excess Funding Account pursuant to the preceding sentence shall be considered Collections of Principal Receivables and shall be applied in accordance with Article VIII of the Indenture and each Indenture Supplement.
(b) If (i) Servicer makes a deposit into the Collection Account in respect of a Collection of a Receivable and such Collection was received by Servicer in the form of a check which is not honored for any reason or (ii) 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, Servicer shall appropriately adjust the amount subsequently deposited into the Collection Account to reflect such dishonored check or mistake. Any Receivable in respect of which a dishonored check is received shall be deemed not to have been paid. Notwithstanding the first two sentences of this paragraph, any adjustments made pursuant to this paragraph will be reflected in a current report but will not change any amount of Collections previously reported pursuant to SECTION 3.4(b).
Section 3.10 REPORTS TO THE COMMISSION. Servicer shall, on behalf of Issuer, cause to be filed with the Commission any periodic reports required to be filed under the provisions of the Securities Exchange Act of 1934, and the rules and regulations of the Commission thereunder. Transferor shall, at its own expense, cooperate in any reasonable request of Servicer in connection with such filings. Issuer agrees to cooperate with Servicer in connection with such filings.
ARTICLE IV
OTHER MATTERS RELATING TO TRANSFEROR
Section 4.1 LIABILITY OF TRANSFEROR. Transferor shall be liable in accordance herewith to the extent, and only to the extent, of the obligations specifically undertaken by it in its capacity as Transferor hereunder.
Section 4.2 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS OF, TRANSFEROR ETC.
(a) Transferor shall not consolidate with or merge into any other corporation or convey or transfer its properties and assets substantially as an entirety to any Person unless:
(i) the Person formed by such consolidation or into which Transferor is merged or the Person which acquires by conveyance or transfer the properties and assets of Transferor substantially as an entirety shall be, if Transferor is not the surviving entity, an entity organized and existing under the laws of the United States of America or any State or the District of Columbia, and, if Transferor is not the surviving entity, such entity shall expressly assume, by an agreement supplemental hereto, executed and delivered to the Owner, in form reasonably satisfactory to Owner Trustee, the performance of every covenant and obligation of Transferor hereunder;
(ii) Transferor has delivered to Indenture Trustee (A) an
Officer's Certificate stating that such consolidation, merger,
conveyance or transfer and such supplemental agreement comply with this
Section and that all conditions precedent herein provided for relating
to such transaction have been complied with, and (B) an Opinion of
Counsel to the effect that such supplemental agreement is a valid and
binding obligation of such surviving entity enforceable against such
surviving entity in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors'
rights generally from time to time in effect and except as such
enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity);
(iii) Transferor shall have delivered to Indenture Trustee and each Rating Agency a Tax Opinion, dated the date of such consolidation, merger, conveyance or transfer, with respect thereto;
(iv) in connection with any merger or consolidation, or any conveyance or transfer referred to above, the business entity into which Transferor shall merge or consolidate, or to which such conveyance or transfer is made, shall be (x) a business entity that may not become a debtor in any case, action or other proceeding under Title 11 of the United States Code or (y) a special-purpose corporation, the powers and activities of which shall be limited to the performance of Transferor's obligations under this Agreement and the other Transaction Documents;
(v) if Transferor is not the surviving entity, the surviving entity shall file new UCC-1 financing statements with respect to the interest of Issuer in the Receivables and the Collateral Certificate, if any; and
(vi) the Rating Agency Condition has been satisfied with respect to such merger, conveyance or transfer.
(b) This SECTION 4.2 shall not be construed to prohibit or in any way limit Transferor's ability to effectuate any consolidation or merger pursuant to which Transferor would be the surviving entity.
(c) Transferor shall notify each Rating Agency promptly after any consolidation, merger, conveyance or transfer effected pursuant to this SECTION 4.2.
(d) The obligations of Transferor hereunder shall not be assignable nor shall any Person succeed to the obligations of Transferor hereunder except in each case in accordance with (i) the provisions of the foregoing paragraphs, (ii) SECTION 2.9 of this Agreement or Section 3.4 of the Trust Agreement or (iii) conveyances, mergers, consolidations, assumptions, sales or transfers to other entities (1) for which Transferor delivers an Officer's Certificate to Indenture Trustee indicating that Transferor reasonably believes that such action will not adversely affect in any material respect the interests of any Noteholder, (2) which meet the requirements of CLAUSE (ii) of PARAGRAPH (a) and (3) for which such purchaser, transferee, pledgee or entity shall expressly assume, in an agreement supplemental hereto, executed and delivered to Owner Trustee and Indenture Trustee in writing in form satisfactory to Owner Trustee and Indenture Trustee, the performance of every covenant and obligation of Transferor thereby conveyed.
Section 4.3 LIMITATION ON LIABILITY OF TRANSFEROR. Subject to SECTION 4.1, neither Transferor, any Holder of the Transferor Interest nor any of their directors, officers, employees or agents of Transferor acting in such capacities shall be under any liability to Issuer, Owner Trustee, the Holders, any Enhancement Provider or any other Person for any action taken or for refraining from the taking of any action in good faith in their capacities as Transferor pursuant to this Agreement; PROVIDED that this provision shall not protect Transferor, any Holder of the Transferor Interest 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. Transferor and any director, officer, employee or agent of Transferor may rely in good faith on any document of any kind prima facie properly executed and submitted by any Person (other than Transferor) respecting any matters arising hereunder.
ARTICLE V
OTHER MATTERS RELATING TO SERVICER
Section 5.1 LIABILITY OF SERVICER. Servicer shall be liable in accordance herewith only to the extent of the obligations specifically undertaken by Servicer in such capacity herein.
Section 5.2 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS OF, SERVICER.
(a) Servicer shall not consolidate with or merge into any other Person or convey or transfer its properties and assets substantially as an entirety to any Person, unless:
(i) the Person formed by such consolidation or into which Servicer is merged or the Person which acquires by conveyance or transfer the properties and assets of Servicer substantially as an entirety shall be a corporation or a banking association organized and existing under the laws of the United States of America or any State or the District of Columbia and, if Servicer is not the surviving entity, shall expressly assume, by an agreement supplemental hereto, executed and delivered to Owner Trustee in form satisfactory to Owner Trustee, the performance of every covenant and obligation of Servicer hereunder;
(ii) Servicer has delivered to Indenture Trustee (A) an
Officer's Certificate stating that such consolidation, merger,
conveyance or transfer and such supplemental agreement comply with this
Section and that all conditions precedent herein provided for relating
to such transaction have been complied with, and (B) an Opinion of
Counsel to the effect that such supplemental agreement is a valid and
binding obligation of such surviving entity enforceable against such
surviving entity in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors'
rights generally from time to time in effect and except as such
enforceability may be limited by general principles of equity (whether
considered in a suit at law or in equity); and
(iii) either (x) the entity formed by such consolidation or into which Servicer is merged or the Person which acquired by conveyance or transfer the properties and assets of Servicer substantially as an entirety shall be an Eligible Servicer (taking into account, in making such determination, the experience and operations of the predecessor Servicer) or (y) upon the effectiveness of such consolidation, merger, conveyance or transfer, a Successor Servicer shall have assumed the obligations of Servicer in accordance with this Agreement;
(b) This SECTION 5.2 shall not be construed to prohibit or in any way limit Servicer's ability to effectuate any consolidation or merger pursuant to which Servicer would be the surviving entity.
(c) Servicer shall notify each Rating Agency promptly after any consolidation, merger, conveyance or transfer effected pursuant to this SECTION 5.2.
Section 5.3 LIMITATION ON LIABILITY OF SERVICER AND OTHERS. Except as provided in SECTION 5.4 with respect to Issuer and Owner Trustee and SECTION 6.7 of the Indenture with respect to Indenture Trustee, neither Servicer nor any of the directors, officers, employees or agents of Servicer in its capacity as Servicer shall be under any liability to Issuer, Owner Trustee, Indenture Trustee, the Holders, any Enhancement Providers 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 that this provision shall not protect 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. Servicer and any director, officer, employee or agent of Servicer may rely in good faith on any document of any kind prima facie properly executed and submitted by any Person (other than Servicer) respecting any matters arising hereunder. 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. Servicer may, in its sole discretion, undertake any such legal action which it may deem necessary or desirable for the benefit of the Holders with respect to this Agreement and the rights and duties of the parties hereto and the interests of the Holders hereunder.
Section 5.4 INDEMNIFICATION OF ISSUER AND OWNER TRUSTEE. Servicer shall
indemnify and hold harmless Issuer and Owner Trustee and their respective
officers, directors, employees and agents, from and against any loss, liability,
expense, damage or injury (i) suffered or sustained by reason of any acts or
omissions of Servicer with respect to Issuer pursuant to this Agreement, and
(ii) arising from or incurred in connection with Owner Trustee's administration
of Issuer and the performance of its duties hereunder or under the Indenture or
Indenture Supplements or any transaction or document contemplated in connection
herewith or therewith including any judgment, award, settlement, reasonable
attorneys' fees and expenses and other costs or expenses incurred in connection
with the defense of any action, proceeding or claim; PROVIDED that (a) Servicer
shall not indemnify Owner Trustee if such acts, omissions or alleged acts or
omissions constitute or are caused by fraud, gross negligence, or willful
misconduct by Owner Trustee, (b) Servicer shall not indemnify Issuer, the
Noteholders or the Note Owners for any liabilities, costs or expenses of Issuer
with respect to any action taken by Owner Trustee at the request of the
Noteholders, (c) Servicer shall not indemnify Issuer, the Noteholders or the
Note Owners as to any losses, claims or damages incurred by any of them in their
capacities as investors, including losses with respect to market or
investment risks associated with ownership of the Notes or losses incurred as a result of Defaulted Receivables and (d) Servicer shall not indemnify Issuer, the Noteholders or the Note Owners for any liabilities, costs or expenses of Issuer, the Noteholders or the Note Owners arising under any tax law, including any Federal, state, local or foreign income or franchise taxes or any other tax imposed on or measured by income (or any interest or penalties with respect thereto or arising from a failure to comply therewith) required to be paid by Issuer, the Noteholders or the Note Owners in connection herewith to any taxing authority. Indemnification pursuant to this Section shall not be payable from the Trust Assets. The provisions of this indemnity shall run directly to and be enforceable by an indemnitee subject to the limitations hereof. This SECTION 5.4 shall survive the termination of this Agreement and the earlier removal or resignation of Owner Trustee.
Servicer shall indemnify Indenture Trustee as provided in Section 6.7 of the Indenture.
Section 5.5 SERVICER NOT TO RESIGN. Servicer shall not resign from the obligations and duties hereby imposed on it except (x) upon the determination that (i) the performance of its duties hereunder is no longer permissible under Requirements of Law (other than the charter and by-laws of Servicer) and (ii) there is no reasonable action which Servicer could take to make the performance of its duties hereunder permissible under such Requirements of Law or (y) as may be required, in connection with Servicer's consolidation with, or merger into any other corporation or Servicer's conveyance or transfer of its properties and assets substantially as an entirety to any person in each case, in accordance with SECTION 5.2. Any determination permitting the resignation of Servicer pursuant to clause (x) above shall be evidenced by an Opinion of Counsel to such effect delivered to Indenture Trustee. No resignation shall become effective until Indenture Trustee or a Successor Servicer shall have assumed the responsibilities and obligations of Servicer in accordance with SECTION 7.2. If within 120 days of the date of the determination that Servicer may no longer act as Servicer, and if Indenture Trustee is unable to appoint a Successor Servicer, Indenture Trustee shall serve as Successor Servicer. Notwithstanding the foregoing, Indenture Trustee shall, if it is legally unable so to act, petition a court of competent jurisdiction to appoint any established institution having a net worth of not less than $50,000,000 and whose regular business includes the servicing of credit card accounts as the Successor Servicer hereunder. Indenture Trustee shall give prompt notice to each Rating Agency and each Enhancement Provider, if any, entitled thereto under the applicable Indenture Supplement upon the appointment of a Successor Servicer.
Section 5.6 ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING THE RECEIVABLES. Servicer shall provide to Indenture Trustee access to the documentation regarding the Accounts and the Receivables in such cases where Indenture Trustee is required in connection with the enforcement of the rights of the Noteholders, or by applicable statutes or regulations to review such documentation, such access being afforded without charge but only (i) upon reasonable request, (ii) during normal business
hours, (iii) subject to Servicer's normal security and confidentiality procedures and (iv) at offices designated by Servicer. Nothing in this SECTION 5.6 shall derogate from the obligation of each Credit Card Originator, Transferor, Indenture Trustee and Servicer to observe any applicable law prohibiting disclosure of information regarding the Obligors and the failure of Servicer to provide access as provided in this SECTION 5.6 as a result of such obligation shall not constitute a breach of this SECTION 5.6.
Section 5.7 DELEGATION OF DUTIES. In the ordinary course of business, Servicer may at any time delegate any duties hereunder to any Person who agrees to conduct such duties in accordance with the Credit Card Guidelines and this Agreement. Any such delegations shall not relieve Servicer of its liability and responsibility with respect to such duties, and shall not constitute a resignation within the meaning of SECTION 5.5, and Servicer shall remain jointly and severally liable with such Person for any amounts which would otherwise be payable pursuant to this ARTICLE V as if Servicer had performed such duty; PROVIDED that in the case of any significant delegation to a Person other than an Affiliate of WFN, at least 30 days' prior written notice shall be given to Indenture Trustee, each Rating Agency and each Enhancement Provider, if any, entitled thereto pursuant to the relevant Indenture Supplement, of such delegation to any entity that is not an Affiliate of Servicer.
ARTICLE VI
INSOLVENCY EVENTS
Section 6.1 RIGHTS UPON THE OCCURRENCE OF AN INSOLVENCY EVENT. If an Insolvency Event occurs with respect to Transferor or any Holder of the Transferor Interest (excluding any Supplemental Interest), Transferor shall on the day any such event occurs, immediately cease to transfer Principal Receivables, or interests in Principal Receivables represented by any Participation Interests to Issuer and shall promptly give notice to Indenture Trustee, Owner Trustee and the Rating Agencies thereof. Notwithstanding any cessation of the transfer to Issuer of additional Principal Receivables or any Participation Interests, Principal Receivables or any Participation Interests transferred to Issuer prior to the occurrence of such Insolvency Event and Collections in respect of such Principal Receivables and Participation Interests, and Finance Charge Receivables whenever created accrued in respect of such Principal Receivables, shall continue to be property of Issuer.
ARTICLE VII
SERVICER DEFAULTS
Section 7.1 SERVICER DEFAULTS. If any one of the following events (a "SERVICER DEFAULT") shall occur and be continuing after the Certificate Trust Termination Date:
(a) any failure by Servicer to make any payment, transfer or deposit or to give instructions or notice to Indenture Trustee on or before the date occurring five Business Days after the date such payment, transfer, deposit, or such instruction or notice is required to be made or given by Servicer, as the case may be, under the terms of this Agreement, the Indenture or any Indenture Supplement; or
(b) failure on the part of Servicer duly to observe or perform in any material respect any other covenants or agreements of Servicer set forth in this Agreement which has a material adverse effect on the Noteholders of any Series or Class (which determination shall be made without regard to whether funds are then available pursuant to any Enhancement), which continues unremedied for a period of 60 days after the date on which written notice of such failure requiring the same to be remedied shall have been given to Servicer by Indenture Trustee, or to Servicer and Indenture Trustee by the Noteholders holding not less than 25% of the Outstanding Amount (or, with respect to any failure that does not relate to all Series, 25% of the aggregate outstanding principal amount of all Series to which such failure relates); or Servicer shall delegate its duties under this Agreement except as permitted by SECTION 5.2 or 5.7, a Responsible Officer of Indenture Trustee has actual knowledge of such delegation and such delegation continues unremedied for 15 days after the date on which written notice thereof, requiring the same to be remedied, shall have been given to Servicer by Indenture Trustee, or to Servicer and Indenture Trustee by Noteholders holding not less than 25% of the Outstanding Amount; or
(c) any representation, warranty or certification made by Servicer in this Agreement or in any certificate delivered pursuant to this Agreement shall prove to have been incorrect when made, which has a material adverse effect on the rights of the Noteholders of any Series or Class (which determination shall be made without regard to whether funds are then available pursuant to any Enhancement) and which continues to be incorrect in any material respect for a period of 60 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to Servicer by Indenture Trustee, or to Servicer and Indenture Trustee by the Noteholders holding not less than 25% of the Outstanding Amount (or, with respect to any such representation, warranty or certification that does not relate to all Series, 25% of the aggregate outstanding principal amount of all Series to which such representation, warranty or certification relates);
(d) Servicer shall fail generally to, or admit in writing its inability to, pay its debts as they become due; or a proceeding shall have been instituted in a court having
jurisdiction in the premises seeking a decree or order for relief in respect of Servicer in an involuntary case under any Debtor Relief Law, or for the appointment of a receiver, liquidator, assignee, trustee, custodian, sequestrator, conservator or other similar official of such Person or for any substantial part of its property, or for the winding-up or liquidation of its affairs and, if instituted against Servicer, any such proceeding shall continue undismissed or unstayed and in effect, for a period of 60 consecutive days, or any of the actions sought in such proceeding shall occur; or the commencement by Servicer, of a voluntary case under any Debtor Relief Law, or such Person's consent to the entry of an order for relief in an involuntary case under any Debtor Relief Law, or consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator, conservator or other similar official of such Person or for any substantial part of its property, or any general assignment for the benefit of creditors; or such Person or any Subsidiary of such Person shall have taken any corporate action in furtherance of any of the foregoing actions; or
(e) with respect to any Series, any other event specified in the Indenture Supplement for such Series, then, in the event of any Servicer Default, so long as Servicer Default shall not have been remedied, either Indenture Trustee or Noteholders holding more than 50% of the Outstanding Amount, by notice given to Servicer (and to Indenture Trustee and any Enhancement Provider entitled thereto pursuant to the relevant Indenture Supplement if given by the Noteholders) (a "TERMINATION NOTICE"), may terminate all but not less than all the rights and obligations of Servicer, as Servicer, under this Agreement and in and to the Receivables and the proceeds thereof. Upon the occurrence of a Servicer Default, the Indenture Trustee shall promptly notify each Rating Agency of such Servicer Default.
After receipt by Servicer of such Termination Notice, and on the date that a Successor Servicer shall have been appointed by Indenture Trustee pursuant to SECTION 7.2, all authority and power of Servicer under this Agreement shall pass to and be vested in the Successor Servicer (a "SERVICE TRANSFER"); and, without limitation, Indenture Trustee is hereby authorized and empowered (upon the failure of Servicer to cooperate) to execute and deliver, on behalf of Servicer, as attorney-in-fact or otherwise, all documents and other instruments upon the failure of Servicer to execute or deliver such documents or instruments, and to do and accomplish all other acts or things necessary or appropriate to effect the purposes of such transfer of servicing rights. Servicer agrees to cooperate with Indenture Trustee and the Successor Servicer in effecting the termination of the responsibilities and rights of Servicer to conduct servicing hereunder including the transfer to the Successor Servicer of all authority of 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 Servicer for deposit, or which have been deposited by Servicer, in the Collection Account, or which shall thereafter be received with respect to the Receivables, and in assisting the Successor Servicer and in enforcing all rights to Insurance Proceeds. Servicer shall promptly transfer its electronic records relating to the
Receivables to the Successor Servicer in such electronic form as the Successor Servicer may reasonably request and shall promptly transfer to the Successor Servicer all other records, correspondence and documents necessary for the continued servicing of the Receivables in the manner and at such times as the Successor Servicer shall reasonably request. To the extent that compliance with this SECTION 7.1 shall require Servicer to disclose to the Successor Servicer information of any kind which Servicer reasonably deems to be confidential, the Successor Servicer shall be required to enter into such customary licensing and confidentiality agreements as Servicer shall deem appropriate to protect its interests.
Notwithstanding the foregoing, any delay in or failure of performance under SECTION 7.1(a) for a period of five Business Days or under SECTION 7.1(b) or (c) for a period of 60 days (in addition to any period provided in SECTION 7.1(a), (b) or (c)) shall not constitute a Servicer Default until the expiration of such additional five Business Days or 60 days, respectively, if such delay or failure could not be prevented by the exercise of reasonable diligence by 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 Servicer from the obligation to use its best efforts to perform its obligations in a timely manner in accordance with this Agreement and Servicer shall provide Indenture Trustee, each Rating Agency, any Enhancement Provider entitled thereto pursuant to the relevant Indenture Supplement and Transferor with an Officer's Certificate giving immediate notice of such failure or delay by it, together with a description of its efforts to so perform its obligations.
Section 7.2 INDENTURE TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR. (a) On
and after the receipt by Servicer of a Termination Notice pursuant to SECTION
7.1, Servicer shall continue to perform all servicing functions under this
Agreement until the date specified in the Termination Notice or otherwise
specified by Indenture Trustee or until a date mutually agreed upon by Servicer
and Indenture Trustee. Indenture 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 Indenture
Trustee. If a Successor Servicer has not been appointed or has not accepted its
appointment at the time when Servicer ceases to act as Servicer, Indenture
Trustee without further action shall automatically be appointed the Successor
Servicer. Indenture Trustee may delegate any of its servicing obligations to an
Affiliate of Indenture Trustee or agent in accordance with SECTION 3.1(b) and
5.7. Notwithstanding the foregoing, Indenture Trustee shall, if it is legally
unable so to act, petition a court of competent jurisdiction to appoint any
established institution having a net worth of not less than $50,000,000 and
whose regular business includes the servicing of credit card receivables as the
Successor Servicer hereunder. Indenture Trustee shall give prompt notice to each
Rating Agency and each Enhancement Provider, if any, entitled thereto pursuant to the applicable Indenture Supplement upon the appointment of a Successor Servicer.
(b) Upon its appointment, the Successor Servicer shall be the successor in all respects to Servicer with respect to servicing functions under this Agreement and shall be subject to all the responsibilities, duties and liabilities (except for liabilities arising during the period of time when the prior Servicer was performing and acting as Servicer) relating thereto placed on Servicer by the terms and provisions hereof, and all references in this Agreement to Servicer shall be deemed to refer to the Successor Servicer.
(c) In connection with any Termination Notice, Indenture 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 for servicing compensation not in excess of the aggregate Servicing Fees for all Series; PROVIDED, HOWEVER, that the Holder of the Transferor Interest shall be responsible for payment of the portion of such aggregate Servicing Fees allocable to the Holder of the Transferor Interest and that no such monthly compensation paid out of Collections shall be in excess of such aggregate Servicing Fees. Each Holder of the Transferor Interest agrees that, if WFN (or any Successor Servicer) is terminated as Servicer hereunder, the portion of the Collections in respect of Finance Charge Receivables that Transferor is entitled to receive pursuant to this Agreement or any Indenture Supplement shall be reduced by an amount sufficient to pay Transferor's share (determined by reference to the Indenture Supplements with respect to any outstanding Series) of the compensation of the Successor Servicer.
(d) All authority and power granted to the Successor Servicer under this Agreement shall automatically cease and terminate upon termination of Issuer pursuant to the Trust Agreement and shall pass to and be vested in Transferor and, Transferor is hereby authorized and empowered to execute and deliver, on behalf of the Successor Servicer, as attorney-in-fact or otherwise, all documents and other instruments, and to do and accomplish all other acts or things necessary or appropriate to effect the purposes of such transfer of servicing rights. The Successor Servicer agrees to cooperate with Transferor in effecting the termination of the responsibilities and rights of the Successor Servicer to conduct servicing on the Receivables. The Successor Servicer shall transfer its electronic records relating to the Receivables to Transferor in such electronic form as Transferor may reasonably request and shall transfer all other records, correspondence and documents to Transferor in the manner and at such times as Transferor shall reasonably request. To the extent that compliance with this SECTION 7.2 shall require the Successor Servicer to disclose to Transferor information of any kind which the Successor Servicer deems to be confidential, Transferor shall be required to enter into such customary licensing and confidentiality agreements as the Successor Servicer shall deem necessary to protect its interests.
Section 7.3 NOTIFICATION TO NOTEHOLDERS. Within two Business Days after Servicer becomes aware of any Servicer Default, Servicer shall give notice thereof to Indenture Trustee, each Rating Agency and any Enhancement Provider entitled thereto pursuant to the relevant Indenture Supplement and Indenture Trustee shall give notice to the Noteholders at their respective addresses appearing in the Note Register. Upon any termination or appointment of a Successor Servicer pursuant to this ARTICLE VII, Indenture Trustee shall give prompt written notice thereof to Noteholders at their respective addresses appearing in the Note Register.
ARTICLE VIII
TERMINATION
Section 8.1 TERMINATION OF AGREEMENT. This Agreement and the respective
obligations and responsibilities of Issuer, Transferor and Servicer under this
Agreement shall terminate, except with respect to the duties described in
SECTION 5.4, on the Trust Termination Date.
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.1 AMENDMENT; WAIVER OF PAST DEFAULTS.
(a) This Agreement may be amended from time to time by Servicer,
Transferor and Issuer, without the consent of any of Indenture Trustee or any
Noteholder to cure any ambiguity, to correct or supplement any provisions herein
which may be inconsistent with any other provisions herein or to add any other
provisions with respect to matters or questions raised under this Agreement
which shall not be inconsistent with the provisions of this Agreement; PROVIDED,
HOWEVER, that such action shall not adversely affect in any material respect the
interests of any of the Noteholders. Additionally, this Agreement may be amended
from time to time by Servicer, Transferor and Issuer by a written instrument
signed by each of them, without the consent of Indenture Trustee or any of the
Noteholders; PROVIDED that (i) Transferor shall have delivered to Indenture
Trustee and Owner Trustee an Officer's Certificate, dated the date of any such
Amendment, stating that Transferor reasonably believes 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. Additionally, notwithstanding the
preceding sentence, this Agreement will be amended by Servicer and Issuer at the
direction of Transferor without the consent of Indenture Trustee or any of the
Noteholders or Enhancement Providers to add, modify or eliminate such provisions
as may be necessary or advisable in order to enable all or a portion of Issuer
(1) to qualify as, and to permit an election to be made to cause Issuer to be
treated as, a "financial asset securitization investment trust" as described in
the provisions of Section 860L of the Code, and (2) to avoid the imposition of
state or local income or franchise taxes imposed on Issuer's
property or its income; PROVIDED, HOWEVER, that (A) Transferor delivers to Indenture Trustee and Owner Trustee an Officer's Certificate to the effect that the proposed amendments meet the requirements set forth in this Section, (B) the Rating Agency Condition has been satisfied, and (C) such amendment does not affect the rights, duties or obligations of Indenture Trustee or Owner Trustee hereunder. The amendments which Transferor may make without the consent of Noteholders or Enhancement Providers pursuant to the preceding sentence may include the addition of a Transferor.
(b) This Agreement may also be amended from time to time by Servicer, Transferor and Issuer, with the consent of the Noteholders holding more than 66 2/3% of the Outstanding principal amount of the Notes of each Series affected thereby for which Transferor has not delivered an Officer's Certificate 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 of modifying in any manner the rights of the Noteholders; PROVIDED, HOWEVER, that no such amendment shall (i) reduce in any manner the amount of or delay the timing of any distributions to be made to Noteholders or deposits of amounts to be so distributed or the amount available under any Enhancement without the consent of each affected Noteholder, (ii) change the definition of or the manner of calculating the interest of any Noteholder without the consent of each affected Noteholder or (iii) reduce the aforesaid percentage required to consent to any such amendment without the consent of each Noteholder or (iv) adversely affect the rating of any Series or Class by any Rating Agency without the consent of the Noteholders of such Series or Class holding more than 66 2/3% of the Outstanding principal amount of the Notes of such Series or Class affected thereby.
(c) Promptly after the execution of any such amendment or consent, Issuer shall furnish notification of the substance of such amendment to Indenture Trustee and each Noteholder, and Servicer shall furnish notification of the substance of such amendment to each Rating Agency and each Enhancement Provider.
(d) It shall not be necessary for the consent of Noteholders under this SECTION 9.1 to approve the particular form of any proposed amendment, but it shall be sufficient if such consent shall approve the substance thereof. The manner of obtaining such consents and of evidencing the authorization of the execution thereof by Noteholders shall be subject to such reasonable requirements as Indenture Trustee may prescribe.
(e) Notwithstanding anything in this SECTION 9.1 to the contrary, no amendment may be made to this Agreement which would adversely affect in any material respect the interests of any Enhancement Provider without the consent of such Enhancement Provider.
(f) Any Indenture Supplement executed in accordance with the provisions of ARTICLE X of the Indenture shall not be considered an amendment of this Agreement for the purposes of this SECTION 9.1.
(g) The Noteholders holding 66 2/3% or more of the Outstanding principal amount of the Notes of each Series or, with respect to any Series with two (2) or more Classes, of each Class (or, with respect to any default that does not relate to all Series, 66 2/3% or more of the principal amount of the Outstanding Notes 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 Noteholders, waive any default by Transferor or Servicer in the performance of their obligations hereunder and its consequences, except the failure to make any distributions required to be made to Noteholders 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. Upon the occurrence of any such waiver, the Indenture Trustee shall promptly notify each Rating Agency of such waiver.
(h) Owner Trustee may, but shall not be obligated to, enter into any such amendment which affects Owner Trustee's rights, duties or immunities under this Agreement or otherwise. In connection with the execution of any amendment hereunder, Owner Trustee shall be entitled to receive the Opinion of Counsel described in SECTION 9.2(d).
Section 9.2 PROTECTION OF RIGHT, TITLE AND INTEREST TO ISSUER.
(a) Transferor shall cause this Agreement, all amendments and supplements hereto and all financing statements and continuation statements and any other necessary documents covering Indenture Trustee's and Issuer's right, title and interest to Issuer 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 Indenture Trustee, Noteholders and Issuer hereunder to all property comprising the Trust Assets. Transferor shall deliver to Indenture 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. Transferor shall cooperate fully with 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 thirty (30) days after Transferor makes any change in its name, identity or corporate structure which would make any financing statement or continuation statement filed in accordance with PARAGRAPH (a) seriously misleading within the meaning of Section 9-402(7) (or any comparable provision) of the UCC, Transferor shall give Indenture Trustee notice of any such change and shall file such financing statements or amendments as may be necessary to continue the perfection of Issuer's security interest or ownership interest in the Receivables and the proceeds thereof.
(c) Each of Transferor and Servicer shall give Indenture Trustee prompt notice of any relocation of its chief principal executive office or any change in the jurisdiction under whose laws it is organized and whether, as a result of such relocation or change, the applicable provisions of the UCC would require the filing of any amendment of any previously filed financing or continuation statement or of any new financing statement and shall file such financing statements or amendments as may be necessary to perfect or to continue the perfection of Issuer's security interest in the Receivables and the proceeds thereof. Each of Transferor and Servicer shall at all times maintain its chief principal executive offices within the United States and shall at all times be organized under the laws of a jurisdiction located within the United States.
(d) Transferor shall deliver to Indenture Trustee, Owner Trustee and any Enhancement Provider entitled thereto pursuant to the relevant Indenture Supplement (i) upon the execution and delivery of each amendment of this Agreement, an Opinion of Counsel to the effect specified in EXHIBIT D-1; (ii) on each Addition Date on which any Supplemental Accounts are to be designated as Accounts pursuant to SECTION 2.8(a) or (b), an Opinion of Counsel substantially in the form of EXHIBIT D-2; and on each Addition Date on which any Participation Interests are to be designated to Issuer pursuant to SECTION 2.8(a) or (b), an Opinion of Counsel covering the same substantive legal issues addressed by EXHIBIT D-2 but conformed to the extent appropriate to relate to Participation Interests; and (iii) on or before March 31 of each year following the year in which the Certificate Trust Termination Date occurs, an Opinion of Counsel substantially in the form of EXHIBIT D-3.
Section 9.3 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.
Section 9.4 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 registered mail, return receipt requested, or sent by facsimile
transmission (i) in the case of Transferor and Servicer, to World Financial
Network National Bank, 800 Techcenter Drive, Gahanna, Ohio 43230, (ii) in the
case of Issuer or Owner Trustee, to the Corporate Trust Office, Attn:
Institutional Trust Services, with a copy to the Administrator, (iii) in the
case of the Rating Agency for a particular Series, the address, if any,
specified in the Indenture Supplement relating to such Series, and (iv) to any
other Person as specified in the Indenture or any Indenture 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 Notes shall be given by first-class mail, postage prepaid, at the address of such Holder as shown in the Note Register. Any Notice so mailed within the time prescribed in this Agreement shall be conclusively presumed to have been duly given, whether or not the Noteholder receives such Notice. In addition, in the case of any Series or Class with respect to which any Notes are outstanding, any Notice required or permitted to be given to Noteholders of such Series or Class shall be published in an Authorized Newspaper within the time period prescribed in this Agreement.
Section 9.5 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 Notes or the rights of the Noteholders.
Section 9.6 FURTHER ASSURANCES. Transferor and 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 Owner Trustee and Indenture Trustee more fully to effect the purposes of this Agreement, including the execution of any financing statements or continuation statements relating to the Receivables for filing under the provisions of the UCC of any applicable jurisdiction.
Section 9.7 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no delay in exercising, on the part of Owner Trustee, Indenture Trustee or the Noteholders, any right, remedy, power or privilege under this Agreement shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege under this Agreement preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges provided under this Agreement are cumulative and not exhaustive of any rights, remedies, powers and privileges provided by law.
Section 9.8 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 9.9 THIRD-PARTY BENEFICIARIES. This Agreement will inure to the benefit of and be binding upon the parties hereto, Indenture Trustee, the Noteholders, and any Enhancement Provider. Except as otherwise expressly provided in this Agreement, no other Person will have any right or obligation hereunder.
Section 9.10 ACTIONS BY NOTEHOLDERS.
(a) Wherever in this Agreement a provision is made that an action may be taken or a Notice given by Noteholders, such action or Notice may be taken or given by any Noteholder, unless such provision requires a specific percentage of Noteholders.
(b) Any Notice, request, authorization, direction, consent, waiver or other act by the Noteholder shall bind such Holder and every subsequent Holder of such Note and of any Note 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 Issuer, Owner Trustee, Transferor or Servicer in reliance thereon, whether or not notation of such action is made upon such Note.
Section 9.11 RULE 144A INFORMATION. For so long as any of the Notes of any Series or Class are "restricted securities" within the meaning of Rule 144(a)(3) under the Securities Act, each of Transferor, Owner Trustee, Indenture Trustee, Servicer and any Enhancement Provider agree to cooperate with each other to provide to any Noteholders of such Series or Class and to any prospective purchaser of Notes designated by such Noteholder, upon the request of such Noteholder 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 Securities Act.
Section 9.12 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 9.13 NO BANKRUPTCY PETITION. Each of Issuer (with respect to Transferor only), Servicer, each Enhancement Provider, if any, and each Holder of a Supplemental Interest and Transferor (with respect to Issuer only) severally and not jointly, hereby covenants and agrees that it will not at any time institute against, solicit or join or cooperate with or encourage any institution against Issuer or Transferor of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or other similar proceeding under any United States federal or state bankruptcy or similar law. Nothing in this SECTION 9.13 shall preclude, or be deemed to estop, any of the foregoing Persons from taking (to the extent such action is otherwise permitted to be taken by such Person hereunder) or omitting to take any action prior to such date in (i) any case or proceeding with respect to Issuer or Transferor voluntarily filed or commenced by or on behalf of Issuer or Transferor, respectively, under or pursuant to any such law or (ii) any involuntary case or proceeding pertaining to Issuer or Transferor, as applicable under or pursuant to any such law.
Section 9.14 RIGHTS OF INDENTURE TRUSTEE. Indenture Trustee shall have herein the same rights, protections, indemnities and immunities as specified in the Indenture.
Section 9.15 RIGHTS OF OWNER TRUSTEE. Each of the parties hereto acknowledges and agrees that this Agreement is being executed and delivered by Chase Manhattan Bank USA, National Association not individually but solely and exclusively in its capacity as Owner Trustee on behalf of World Financial Network Credit Card Master Note Trust for the purpose and with the intention of binding World Financial Network Credit Card Master Note Trust. No obligations or liabilities hereunder shall run against Chase Manhattan Bank USA, National Association in its individual capacity or against its properties or assets.
IN WITNESS WHEREOF, Transferor, Servicer and Issuer have caused this Transfer and Servicing Agreement to be duly executed by their respective officers as of the day and year first above written.
WFN CREDIT COMPANY, LLC, as
Transferor
By: /s/ Robert P. Armiak ------------------------------ Name: Robert P. Armiak Title: Vice President and Treasurer |
WORLD FINANCIAL NETWORK
NATIONAL BANK, as Servicer
By: /s/ Robert P. Armiak ------------------------------ Name: Robert P. Armiak Title: Vice President and Treasurer |
WORLD FINANCIAL NETWORK
CREDIT CARD MASTER NOTE
TRUST, Issuer
By: Chase Manhattan Bank USA, National Association, not in its individual capacity but solely as Owner Trustee on behalf of Issuer
By: /s/ Denis Kelly ------------------------------ Name: Denis Kelly Title: Assistant Vice President |
Acknowledged and Accepted:
BNY MIDWEST TRUST COMPANY,
not in its individual capacity but
solely as Indenture Trustee
By: /s/ Eric Lindahl ------------------------------ Name: Eric Lindahl Title: Assistant Vice President |
EXHIBIT A
to
TRANSFER AND SERVICING AGREEMENT
FORM OF ASSIGNMENT OF RECEIVABLES
IN SUPPLEMENTAL ACCOUNTS
(As required by SECTION 2.6 of the Transfer and Servicing Agreement)
ASSIGNMENT No. __ OF RECEIVABLES IN SUPPLEMENTAL ACCOUNTS dated as of _____________, by and among WFN Credit Company, LLC, a Delaware limited liability company, as Transferor (the "TRANSFEROR"), WORLD FINANCIAL NETWORK NATIONAL BANK, a national banking association, as Servicer (the "SERVICER") and WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST (the "ISSUER"), pursuant to the Transfer and Servicing Agreement referred to below.
WITNESSETH
WHEREAS, Transferor, Servicer and Issuer are parties to the Transfer and Servicing Agreement, dated as of August 1, 2001 (as it may be amended and supplemented from time to time the "AGREEMENT");
WHEREAS, pursuant to the Agreement, Transferor wishes to designate Supplemental Accounts owned by the Credit Card Originator to be included as Accounts and to convey the Receivables of such Supplemental Accounts, whether now existing or hereafter created, to Issuer (as each such term is defined in the Agreement); and
WHEREAS, Issuer is willing to accept such designation and conveyance subject to the terms and conditions hereof;
NOW, THEREFORE, Transferor, Servicer and Issuer hereby agree as follows:
1. DEFINED TERMS. All capitalized terms used herein shall have the meanings ascribed to them in the Agreement unless otherwise defined herein.
"ADDITION DATE" means, with respect to the Supplemental Accounts designated hereby, ____________, _____.
"ADDITION CUT OFF DATE" means, with respect to the Supplemental Accounts designated hereby, _____________, _____.
2. DESIGNATION OF SUPPLEMENTAL ACCOUNTS. On or before the Document Delivery Date, Transferor will deliver to Owner Trustee an Account Schedule containing a true and complete schedule identifying all such Supplemental Accounts specifying for
Exhibit A-1
each such Account, as of the Addition Cut Off Date, its account number, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables outstanding in such Account, which Account Schedule shall supplement any other Account Schedule previously delivered to Issuer pursuant to the Agreement.
3. CONVEYANCE OF RECEIVABLES. (a) Transferor does hereby transfer, assign, set over and otherwise convey, without recourse except as set forth in the Transfer and Servicing Agreement, to Issuer, all its right, title and interest in, to and under the Receivables of such Supplemental Accounts existing at the close of business on the Addition Cut Off Date and thereafter created from time to time until the termination of Issuer, all Recoveries related thereto, all monies due or to become due and all amounts received or receivable with respect thereto and all proceeds thereof. The foregoing does not constitute and is not intended to result in the creation or assumption by Issuer, Owner Trustee, Indenture Trustee, any Noteholders or any Enhancement Provider of any obligation of Servicer, Transferor, the Credit Card Originator or any other Person in connection with the Accounts, the Receivables or under any agreement or instrument relating thereto, including any obligation to Obligors, merchant banks, merchants clearance systems or insurers.
(b) Transferor agrees to record and file, at its own expense, financing statements (and continuation statements when applicable) with respect to the Receivables in Supplemental Accounts existing on the Addition Cut Off Date and thereafter created meeting the requirements of applicable state law in such manner and in such jurisdictions as are necessary to perfect, and maintain perfection of, the sale and assignment of its interest in such Receivables to Issuer, and to deliver a file-stamped copy of each such financing statement or other evidence of such filing to Issuer on or prior to the Addition Date. Owner Trustee shall be under no obligation whatsoever to file such financing or continuation statements or to make any other filing under the UCC in connection with such sale and assignment.
(c) In connection with such assignment, Transferor further agrees, at its own expense, on or prior to the date of this Assignment, to cause the Credit Card Originator to indicate in the appropriate computer files that Receivables created in connection with the Supplemental Accounts and designated hereby have been conveyed to Issuer pursuant to the Agreement and this Assignment.
(d) Transferor does hereby grant to Issuer a security interest in all of its right, title and interest, whether now owned or hereafter acquired, in and to the Receivables in the Supplemental Accounts existing on the Addition Cut Off Date and thereafter created, all Recoveries related thereto, and all proceeds thereof. This Assignment constitutes a security agreement under the UCC.
4. ACCEPTANCE BY ISSUER. Issuer hereby acknowledges its acceptance of all right, title and interest to the property, existing on the Addition Cut Off Date and thereafter created, conveyed to Issuer pursuant to SECTION 3(a) of this Assignment. Issuer
Exhibit A-2
further acknowledges that, prior to or simultaneously with the execution and delivery of this Assignment, Transferor delivered to it the Account Schedule described in SECTION 2 of this Assignment.
5. REPRESENTATIONS AND WARRANTIES OF TRANSFEROR. Transferor hereby represents and warrants to Issuer as of the date of this Assignment and as of the Addition Date:
(a) LEGAL VALID AND BINDING OBLIGATION. This Assignment constitutes a legal, valid and binding obligation of Transferor enforceable against Transferor in accordance with its terms, except as such enforceability may be limited by applicable receivership or conservatorship, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect affecting the enforcement of creditors' rights in general and the rights of creditors of national banking associations 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 AND RECEIVABLES. Each Supplemental Account designated hereby is an Eligible Account and each Receivable in such Accounts is, as of the Addition Cut Off Date, an Eligible Receivable;
(c) INSOLVENCY. As of each of the Addition Cut Off Date and the Addition Date, no Insolvency Event with respect to the Credit Card Originator or Transferor has occurred and the transfer by Transferor of Receivables arising in the Supplemental Accounts to Issuer has not been made in contemplation of the occurrence thereof;
(d) EARLY AMORTIZATION EVENT. Transferor reasonably believes that (A) the addition of the Receivables arising in the Supplemental Accounts will not, based on the facts known to Transferor, then or thereafter cause an Early Amortization Event to occur with respect to any Series and (B) no selection procedure was utilized by Transferor which would result in the selection of Supplemental Accounts (from among the available Eligible Accounts owned by the Credit Card Originator) that would be materially less favorable to the interests of the Noteholders of any Series as of the Addition Date than a random selection;
(e) SECURITY INTEREST. Either this Assignment constitutes a valid transfer and assignment to Issuer of all right, title and interest of Transferor in the Receivables and other Trust Assets conveyed to Issuer by Transferor and all monies due or to become due and all amounts received with respect thereto and the proceeds thereof, or this Assignment constitutes a grant of a security interest in such property to Issuer, which, in the case of existing Receivables and the proceeds thereof, is enforceable upon execution and delivery of this Assignment, and which will be enforceable with respect to such Receivables hereafter created and the proceeds thereof upon such creation. Upon the filing of the financing
Exhibit A-3
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, Issuer shall have a first priority security interest in such property except for Liens permitted under SECTION 2.7(b) of the Agreement;
(f) NO CONFLICT. The execution and delivery by Transferor of this Assignment, the performance of the transactions contemplated by this Assignment and the fulfillment of the terms hereof applicable to Transferor, will not conflict with or violate any Requirements of Law applicable to 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 Transferor is a party or by which it or its properties are bound;
(g) NO PROCEEDINGS. There are no proceedings or investigations pending or, to the best knowledge of Transferor, threatened against 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 Transferor, would materially and adversely affect the performance by Transferor of its obligations under this Assignment, (iv) seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Assignment or (v) seeking to affect adversely the income tax attributes of Issuer under the Federal, or applicable state income or franchise tax systems; and
(h) ALL CONSENTS. All authorizations, consents, orders or approvals or other actions of any Person or of any court or other governmental authority required to be obtained by Transferor in connection with the execution and delivery of this Assignment by Transferor and the performance of the transactions contemplated by this Assignment by Transferor, have been obtained.
7. AMENDMENT OF THE TRANSFER AND SERVICING AGREEMENT. The Transfer and Servicing Agreement is hereby amended to provide that all references therein to the "Transfer and Servicing Agreement", to "this Agreement" and "herein" shall be deemed from and after the Addition Date to be a dual reference to the Transfer and Servicing Agreement as supplemented by this Assignment. Except as expressly amended hereby, all of the representations, warranties, terms, covenants and conditions of the Transfer and Servicing Agreement shall remain unamended and shall continue to be, and shall remain, in full force and effect in accordance with its terms and except as expressly provided herein shall not constitute or be deemed to constitute a waiver of compliance with or a consent to noncompliance with any term or provision of the Transfer and Servicing Agreement.
Exhibit A-4
8. 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 together shall constitute one and the same instrument.
9. RIGHTS OF OWNER TRUSTEE. Each of the parties hereto acknowledges and agrees that this Agreement is being executed and delivered by Chase Manhattan Bank USA, National Association not individually but solely and exclusively in its capacity as Owner Trustee on behalf of World Financial Network Credit Card Master Note Trust for the purpose and with the intention of binding World Financial Network Credit Card Master Note Trust. No obligations or liabilities hereunder shall run against Chase Manhattan Bank USA, National Association in its individual capacity or against its properties or assets.
10. 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.
Exhibit A-5
IN WITNESS WHEREOF, the undersigned have caused this Assignment of Receivables in Additional Accounts to be duly executed and delivered by their respective duly authorized officers on the day and year first above written.
WFN CREDIT COMPANY, LLC,
Transferor
By:_________________________________
Name:
Title:
WORLD FINANCIAL NETWORK
NATIONAL BANK, Servicer
By:_________________________________
Name:
Title:
WORLD FINANCIAL NETWORK
CREDIT CARD MASTER NOTE
TRUST,
Issuer
By: Chase Manhattan Bank USA, National
Association,
not in its individual capacity but solely on
behalf of Issuer
By:_________________________________
Name:
Title:
Exhibit A-6
Schedule 1 to Assignment of Receivables in Additional Accounts
Exhibit A-7
EXHIBIT B
to
TRANSFER AND SERVICING AGREEMENT
FORM OF REASSIGNMENT OF RECEIVABLES
IN REMOVED ACCOUNTS
(As required by SECTION 2.7 of the Transfer and Servicing Agreement)
REASSIGNMENT No. _______ OF RECEIVABLES dated as of _________, by and among WFN CREDIT COMPANY, LLC, a Delaware limited liability company, as Transferor (the "TRANSFEROR"), WORLD FINANCIAL NETWORK NATIONAL BANK, a national banking association, as Servicer (the "SERVICER"), and WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST (the "ISSUER"), pursuant to the Transfer and Servicing Agreement referred to below.
WITNESSETH:
WHEREAS Transferor, Servicer and Issuer are parties to the Transfer and Servicing Agreement, dated as of August 1, 2001 (as it may be amended and supplemented from time to time the "AGREEMENT");
WHEREAS pursuant to the Agreement, Transferor wishes to remove from Issuer all Receivables owned by Issuer in certain designated Accounts and to cause Issuer to reconvey the Receivables of such Removed Accounts, whether now existing or hereafter created, from Issuer to Transferor; and
WHEREAS Issuer is willing to accept such designation and to reconvey the Receivables in the Removed Accounts subject to the terms and conditions hereof;
NOW, THEREFORE, Transferor, Servicer and Issuer 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" means, with respect to the Removed Accounts designated hereby, ___________, ____.
"REMOVAL NOTICE DATE" means, with respect to the Removed Accounts ______________, ____.
2. DESIGNATION OF REMOVED ACCOUNTS. On or before the date that is ten
(10) Business Days after the Removal Date, Transferor will deliver to Issuer an
Account Schedule identifying all Accounts the Receivables of which are being
removed from Issuer, specifying for each such Account, as of the Removal Notice
Date, its account
Exhibit B-1
number, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables in such Account, which Account Schedule shall supplement any Account Schedule previously delivered to Issuer pursuant to the Agreement.
3. CONVEYANCE OF RECEIVABLES. (a) Issuer does hereby transfer, assign, set over and otherwise convey to Transferor, without representation, warranty or recourse, on and after the Removal Date, all right, title and interest of Issuer 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 Recoveries related thereto, all monies due or to become due and all amounts received or receivable with respect thereto and all proceeds thereof.
(b) In connection with such transfer, Issuer agrees to execute and deliver to the Seller on or prior to the date this Reassignment is delivered, applicable termination statements prepared by Transferor 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 Issuer 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 TRANSFEROR. Transferor hereby represents and warrants to Issuer as of the Removal Date:
(a) LEGAL VALID AND BINDING OBLIGATION. This Reassignment Agreement constitutes a legal, valid and binding obligation of Transferor enforceable against 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) EARLY AMORTIZATION EVENT. Transferor reasonably believes that (A) the removal of the Receivables existing in the Removed Accounts will not, based on the facts known to Transferor, then or thereafter cause an Early Amortization Event to occur with respect to any Series, (B) no selection procedure was utilized by Transferor which would result in a selection of Removed Accounts from among any pools of Accounts of a similar type that would be materially adverse to the interests of the Noteholders of any Series as of the Removal Date and (C) Accounts (or administratively convenient groups of Accounts, such as billing cycles) were chosen for removal on a random basis or another basis that Transferor believes is consistent with achieving derecognition of the Receivables under GAAP;
Exhibit B-2
(c) LIST OF REMOVED ACCOUNTS. The list of Removed Accounts delivered pursuant to Section 2.7(a)(ii) of the Agreement, as of the Removal Date, is true and complete in all material respects;
(d) DEFAULTED RECEIVABLES. No selection procedure was utilized by Transferor with the intent to include a disproportionately higher level of Defaulted Receivables in the Removed Accounts than exist in the Accounts or to remove Accounts for the intended purpose of mitigating losses to the Trust;
(e) RECEIVABLES TESTS. The aggregate Principal Receivables in the Removed Accounts did not exceed the lesser of (i) the excess of the Transferor Amount over the Minimum Transferor Amount or (ii) the excess of the Aggregate Principal Balance over the Required Principal Balance, all measured as of the end of the most recently ended Monthly Period; and
(f) COLLATERAL AMOUNTS. Such removal shall not cause a decrease in the sum of the Collateral Amounts for all outstanding Series.
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.
8. RIGHTS OF OWNER TRUSTEE. Each of the parties hereto acknowledges and agrees that this Agreement is being executed and delivered by Chase Manhattan Bank USA, National Association not individually but solely and exclusively in its capacity as Owner Trustee on behalf of World Financial Network Credit Card Master Note Trust for the purpose and with the intention of binding World Financial Network Credit Card Master Note Trust. No obligations or liabilities hereunder shall run against Chase Manhattan Bank USA, National Association in its individual capacity or against its properties or assets.
Exhibit B-3
IN WITNESS WHEREOF, the undersigned have caused this Reassignment Agreement to be duly executed and delivered by their respective duly authorized officers on the day and year first above written.
WFN CREDIT COMPANY, LLC,
Transferor
By:_______________________________
Name:
Title:
WORLD FINANCIAL NETWORK
NATIONAL BANK, Servicer
By:_______________________________
Name:
Title:
WORLD FINANCIAL NETWORK
CREDIT CARD MASTER NOTE
TRUST, Issuer
By: Chase Manhattan Bank USA,
National Association,
not in its individual capacity but solely on
behalf of Issuer
By:_______________________________
Name:
Title:
Exhibit B-4
Schedule 1 to Reassignment Agreement
Exhibit B-5
EXHIBIT C
to
TRANSFER AND SERVICING AGREEMENT
FORM OF ANNUAL SERVICER'S CERTIFICATE
(To be delivered on or before the
90th day following the end of the fiscal year of Transferor pursuant to SECTION 3.5 of the Transfer and Servicing Agreement referred to below)
WORLD FINANCIAL NETWORK NATIONAL BANK
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
The undersigned, a duly authorized representative of World Financial Network National Bank, as Servicer ("WFN"), pursuant to the Transfer and Servicing Agreement dated as of August 1, 2001 (as may be amended and supplemented from time to time, the "AGREEMENT"), among WFN Credit Company, LLC, as Transferor, WFN, as Servicer, and World Financial Network Credit Card Master Note Trust, as Issuer, does hereby certify that:
1. WFN is, as of the date hereof, 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 Indenture Trustee.
3. A review of the activities of Servicer during the fiscal year ended __________, ____, and of its performance under the Agreement was conducted under my supervision.
4. Based on such review, 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.
5. The following is a description of each default in the performance of Servicer's obligations under the provisions of the Agreement known to me to have been made by Servicer during the fiscal year ended ___________, _____, which sets forth in detail (i) the nature of each such default, (ii) the action taken by Servicer, if any, to remedy each such default and (iii) the current status of each such default: if applicable, insert "None."
Exhibit C-1
IN WITNESS WHEREOF, the undersigned has duly executed this Certificate this ______ day of ____________, 20___.
WORLD FINANCIAL NETWORK
NATIONAL BANK, Servicer
By:_______________________________
Name:
Title:
Exhibit C-2
EXHIBIT D-1
to
TRANSFER AND SERVICING AGREEMENT
FORM OF OPINION OF COUNSEL WITH RESPECT
TO AMENDMENTS
(Provisions to be included in
Opinion of Counsel to be delivered pursuant to SECTION 9.2(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 Transfer and Servicing Agreement attached hereto as Schedule 1 (the "AMENDMENT"), has been duly authorized, executed and delivered by Transferor and Servicer and constitutes the legal, valid and binding agreement of Transferor and Servicer, respectively, enforceable in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws from time to time in effect affecting creditors' rights generally or the rights of creditors of national banking associations. The enforceability of the respective obligations of Transferor and Servicer is also subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law)
(ii) The Amendment has been entered into in accordance with the terms and provisions of SECTION 9.1 of the Transfer and Servicing Agreement.
Exhibit D-1-1
EXHIBIT D-2
to
TRANSFER AND SERVICING AGREEMENT
FORM OF OPINION OF COUNSEL WITH RESPECT
TO ADDITION OF SUPPLEMENTAL ACCOUNTS
(Provisions to be included in
Opinion of Counsel to be
delivered pursuant to
SECTION 9.2(d)(ii))
The opinions set forth below may be subject to appropriate qualifications, assumptions, limitations and exceptions.
1. The Receivables arising in such Supplemental Accounts constitute accounts.
2. The Transfer and Servicing Agreement creates in favor of the Trust a security interest in Transferor's rights in the Receivables in such Supplemental Accounts and the proceeds thereof (the "SPECIFIED ASSETS").
3. The security interest in the Specified Assets created by the Pooling and Servicing Agreement will be perfected by the filing of the Financing Statements as described and defined in such opinion. Based solely upon our review of the UCC Searches as described and defined in such opinion, we hereby confirm to you that no Person other than the Trust has filed any financing statement with the Filing Offices as described and defined in such opinion that covers the Specified Assets and that would have priority over the security interest, if any, of the Trust by virtue of such filing.
4. The Receivables Purchase Agreement creates in favor of Transferor a security interest in the RPA Seller's rights in the Specified Assets.
5. The security interest in the Specified Assets created by the Receivables Purchase Agreement will be perfected by the filing of the Financing Statements as described and defined in such opinion. Based solely upon our review of the UCC Searches as described and defined in such opinion, we hereby confirm to you that no Person other than Transferor has filed any financing statement with the Filing Offices as described and defined in such opinion that covers the Specified Assets and that would have priority over the security interest, if any, of Transferor by virtue of such filing.
Exhibit D-2-1
EXHIBIT D-3
PROVISIONS TO BE INCLUDED IN
ANNUAL OPINION OF COUNSEL
The opinions set forth below may be subject to certain qualifications, assumptions, limitations and exceptions taken or made in the opinion of counsel to Transferor with respect to similar matters delivered on the Initial Closing Date. Unless otherwise indicated, all capitalized terms used herein shall have the meanings ascribed to them in the Transfer and Servicing Agreement.
1. No filing or other action, other than such filing or other action described in this opinion letter, is necessary from the date of this opinion letter through March 31 of the following year to continue the perfected status of the security interest of the Trust in the Receivables described in the financing statements referenced in this opinion letter.
2. No filing or other action, other than such filing or other action described in this opinion letter, is necessary from the date of this opinion letter through March 31 of the following year to continue the perfected status of the security interest of Indenture Trustee in the Receivables described in the financing statements referenced in this opinion letter.
Exhibit D-3-1
SCHEDULE 1
[Original list delivered to Owner Trustee]
Exhibit 4.4
AMENDED AND RESTATED TRUST AGREEMENT
between
WFN CREDIT COMPANY, LLC,
as Transferor,
and
CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION
as Owner Trustee
Dated as of August 1, 2001
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS..............................................................1
Section 1.1. Capitalized Terms...............................................1
Section 1.2. Other Definitional Provisions...................................1
ARTICLE II ORGANIZATION.............................................................2
Section 2.1. Name............................................................2
Section 2.2. Office..........................................................2
Section 2.3. Purpose and Powers..............................................2
Section 2.4. Appointment of Owner Trustee....................................3
Section 2.5. Capital Contribution of Trust Estate............................3
Section 2.6. Declaration of Trust............................................3
Section 2.7. Title to Trust Property.........................................4
Section 2.8. Situs of Trust..................................................4
Section 2.9. Representations and Warranties of Transferor....................4
Section 2.10. Liability of Beneficiaries......................................5
ARTICLE III BENEFICIAL INTERESTS.....................................................5
Section 3.1. Initial Ownership...............................................5
Section 3.2. Transferor Interest.............................................5
Section 3.3. Form of Transferor Interest.....................................6
Section 3.4. Restrictions on Transfer; Issuance of Supplemental Interests....6
ARTICLE IV ACTIONS BY OWNER TRUSTEE.................................................7
Section 4.1. Prior Notice to Transferor with Respect to Certain Matters......7
Section 4.2. Restrictions on Power...........................................7
ARTICLE V AUTHORITY AND DUTIES OF OWNER TRUSTEE....................................8
Section 5.1. General Authority...............................................8
Section 5.2. General Duties..................................................8
Section 5.3. Action Upon Instruction.........................................8
Section 5.4. No Duties Except as Specified in this
Agreement or in Instructions....................................9
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Section 5.5. No Action Except under Transaction
Documents or Instructions......................................10
Section 5.6. Restrictions...................................................10
Section 5.7. Tax Returns....................................................10
ARTICLE VI CONCERNING OWNER TRUSTEE................................................10
Section 6.1. Acceptance of Trusts and Duties................................10
Section 6.2. Furnishing of Documents........................................12
Section 6.3. Representations and Warranties.................................12
Section 6.4. Reliance; Advice of Counsel....................................13
Section 6.5. Not Acting in Individual Capacity..............................13
Section 6.6. Owner Trustee Not Liable for Notes or Receivables..............14
Section 6.7. Owner Trustee Not to Own Notes.................................14
ARTICLE VII COMPENSATION OF OWNER TRUSTEE...........................................14
Section 7.1. Owner Trustee's Fees and Expenses..............................14
Section 7.2. Indemnification................................................15
Section 7.3. Payments to Owner Trustee......................................15
ARTICLE VIII TERMINATION OF TRUST AGREEMENT..........................................15
Section 8.1. Termination of Trust Agreement.................................15
ARTICLE IX SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES..................16
Section 9.1. Eligibility Requirements for Owner Trustee.....................16
Section 9.2. Resignation or Removal of Owner Trustee........................16
Section 9.3. Successor Owner Trustee........................................17
Section 9.4. Merger or Consolidation of Owner Trustee.......................18
Section 9.5. Appointment of Co-Trustee or Separate Trustee..................18
ARTICLE X MISCELLANEOUS...........................................................19
Section 10.1. Supplements and Amendments.....................................19
Section 10.2. No Legal Title to Trust Estate in Transferor...................21
Section 10.3. Limitations on Rights of Others................................21
Section 10.4. Notices........................................................22
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Section 10.5. Severability...................................................22
Section 10.6. Separate Counterparts..........................................22
Section 10.7. Successors and Assigns.........................................22
Section 10.8. Non-petition Covenants.........................................22
Section 10.9. No Recourse....................................................23
Section 10.10. Headings.......................................................23
Section 10.11. GOVERNING LAW..................................................23
Section 10.12. Integration of Documents.......................................23
|
AMENDED AND RESTATED TRUST AGREEMENT, dated as of August 1, 2001 (this "AGREEMENT"), between WFN CREDIT COMPANY, LLC, a Delaware limited liability company, as Transferor, and CHASE MANHATTAN BANK USA, NATIONAL ASSOCIATION, a national banking association, as Owner Trustee.
WHEREAS, Transferor and Owner Trustee have entered into that certain Trust Agreement dated as of July 27, 2001 (the "Original Trust Agreement"); and
WHEREAS, pursuant to SECTION 4 of the Original Trust Agreement, the Transferor and the Owner Trustee desire to amend and restate the Original Trust Agreement in its entirety;
NOW, THEREFORE, in consideration of the mutual agreements contained herein, the Original Trust Agreement is hereby amended and restated in its entirety as follows:
ARTICLE I
DEFINITIONS
Section 1.1. CAPITALIZED TERMS. Capitalized terms used herein and not otherwise defined herein are defined in ANNEX A to the Master Indenture, dated as of the date hereof, between World Financial Network Credit Card Master Note Trust and BNY Midwest Trust Company.
Section 1.2. OTHER DEFINITIONAL PROVISIONS. All terms defined
directly or by reference in this Agreement shall have the defined meanings
when used in any certificate or other document delivered pursuant hereto
unless otherwise defined therein. For purposes of this Agreement and all such
certificates and other documents, unless the context otherwise requires: (a)
accounting terms not otherwise defined in this Agreement, and accounting
terms partly defined in this Agreement to the extent not defined, shall have
the respective meanings given to them under GAAP; (b) terms defined in
Article 9 of the UCC as in effect in the State of Delaware and not otherwise
defined in this Agreement are used as defined in that Article; (c) any
reference to each Rating Agency shall only apply to any specific rating
agency if such rating agency is then rating any outstanding Series; (d)
references to any amount as on deposit or outstanding on any particular date
means such amount at the close of business on such day; (e) the words
"hereof," "herein" and "hereunder" and words of similar import refer to this
Agreement (or the certificate or other document in which they are used) as a
whole and not to any particular provision of this Agreement (or such
certificate or document); (f) references to any Section, Schedule or Exhibit
are references to Sections, Schedules and Exhibits in or to this Agreement
(or the certificate or other document in which the reference is made), and
references to any paragraph, Section, clause or other subdivision within any
Section or definition refer to such paragraph, subsection, clause or other
subdivision of such Section or definition;
(g) the term "including" means "including without limitation"; (h) references to any law or regulation refer to that law or regulation as amended from time to time and include any successor law or regulation; (i) references to any Person include that Person's successors and assigns; and (j) headings are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof.
ARTICLE II
ORGANIZATION
Section 2.1. NAME. The trust created hereby shall be known as "World Financial Network Credit Card Master Note Trust," in which name the Trust and Owner Trustee on behalf of the Trust each shall have power and authority and is hereby authorized and empowered to and may conduct the business of the Trust, make and execute contracts and other instruments on behalf of the Trust and sue and be sued.
Section 2.2. OFFICE. The office of the Trust shall be in care of Owner Trustee at the Corporate Trust Office or at such other address in the United States as Owner Trustee may designate by written notice to Transferor and Indenture Trustee.
Section 2.3. PURPOSE AND POWERS. The purpose of the Trust is to engage in the activities set forth in this SECTION 2.3. The Trust shall have power and authority and is hereby authorized and empowered, without the need for further action on the part of the Trust, and Owner Trustee shall have power and authority, and is hereby authorized and empowered, in the name and on behalf of the Trust, to do or cause to be done all acts and things necessary, appropriate or convenient to cause the Trust, to engage in the activities set forth in this SECTION 2.3 as follows:
(i) to execute, deliver and issue the Notes pursuant to the Indenture, to issue the Transferor Interest and to issue the Supplemental Interests, if any, pursuant to this Agreement;
(ii) with the proceeds of the sale of the Notes, to acquire the Trust Estate and to pay Transferor the amounts owed pursuant to SECTION 2.1 of the Transfer and Servicing Agreement;
(iii) to assign, grant, pledge and mortgage the Collateral pursuant to the Indenture and to hold, manage and distribute to the Holder of the Transferor Interest pursuant to the terms of this Agreement and the Transaction Documents any portion of the Collateral released from the lien of, and remitted to the Trust pursuant to, the Indenture;
(iv) to enter into, execute, deliver and perform the Transaction Documents to which it is to be a party;
(v) to engage in those activities, including entering into agreements, that are necessary, suitable or convenient to accomplish the foregoing or are incidental thereto or connected therewith; and
(vi) subject to compliance with the Transaction Documents, to engage in such other activities as may be required in connection with conservation of the Trust Estate and the making of payments to the Noteholders and distributions to the Holder of the Transferor Interest.
The Trust shall not have power, authority or authorization to, and shall not, engage in any activity other than in connection with the foregoing or other than as required or authorized by the Transaction Documents. The Trust shall have no power to hold any derivative financial instrument unless such derivative financial instrument complies with the requirements of paragraph 40 of Statement of Financial Accounting Standards No. 140 issued by the Financial Accounting Standards Board, including any interpretations thereof or any successor regulations issued by the Financial Accounting Standards Board.
Section 2.4. APPOINTMENT OF OWNER TRUSTEE. Transferor hereby appoints Owner Trustee as trustee of the Trust effective as of the date hereof, to have all the rights, powers and duties set forth herein.
Section 2.5. CAPITAL CONTRIBUTION OF TRUST ESTATE. Pursuant to the Transfer and Servicing Agreement, Transferor shall assign, transfer, convey and set over to the Trust, as of the Initial Closing Date, the assets specified in the Transfer and Servicing Agreement. Owner Trustee hereby acknowledges receipt in trust from Transferor, as of the date hereof, of the foregoing contribution, which shall constitute part of the Trust Estate and shall be held by Owner Trustee on behalf of the Trust. Transferor shall pay organizational expenses of the Trust as they may arise or shall, upon the request of Owner Trustee, promptly reimburse Owner Trustee for any such expenses paid by Owner Trustee.
Section 2.6. DECLARATION OF TRUST. Owner Trustee hereby declares that it will hold the Trust Estate in trust upon and subject to the conditions set forth herein for the use and benefit of Transferor, subject to the obligations of the Trust under the Transaction Documents to which it is a party. It is the intention of the parties hereto that the Trust constitute a business trust under the Business Trust Statute and that this Agreement constitute the governing instrument of such trust. It is the intention of the parties hereto that, for income tax purposes, the Trust shall be treated as a security device and not as an entity separate from Transferor and its assets shall be treated as owned in whole by Transferor. The parties hereto agree that they will take no action contrary to the foregoing intention. Effective as of the date hereof, Owner Trustee shall have all rights, powers and authority set forth herein and, to the extent not inconsistent herewith, in the Business Trust
Statute with respect to accomplishing the purposes of the Trust. The Owner Trustee has filed or caused to be filed the Certificate of Trust in the form of EXHIBIT A to the Original Trust Agreement.
Section 2.7. TITLE TO TRUST PROPERTY. Legal title to all the Trust Estate shall be vested at all times in the Trust as a separate legal entity except where applicable law in any jurisdiction requires title to any part of the Trust Estate to be vested in a trustee or trustees, in which case title shall be deemed to be vested in Owner Trustee, a co-trustee and/or a separate trustee, as the case may be.
Section 2.8. SITUS OF TRUST. The Trust will be located and administered in the State of Delaware. All bank accounts maintained by, or on behalf of, the Trust shall be located in the State of Delaware or the State of New York. The Trust shall not have any employees in any state other than Delaware; PROVIDED, HOWEVER, that nothing herein shall restrict or prohibit Owner Trustee from having employees within or without the State of Delaware. Payments will be received by the Trust only in Delaware or New York, and payments will be made by the Trust only from Delaware or New York. The only office of the Trust will be at the Corporate Trust Office.
Section 2.9. REPRESENTATIONS AND WARRANTIES OF TRANSFEROR. Transferor hereby represents and warrants to Owner Trustee (as such or in its individual capacity) that:
(a) Transferor is a limited liability company duly organized and validly existing in good standing under the laws of the State of Delaware and has full corporate power and authority to own its properties and to conduct its business as such properties are presently owned and such business is presently conducted, and to execute, deliver and perform its obligations under the Transaction Documents to which it is a party and to perform its obligations as contemplated thereby.
(b) Transferor is duly qualified to do business and is in good standing (or is exempt from such requirement) in any State required in order to conduct its business, and has obtained all necessary licenses and approvals with respect to Transferor, in each jurisdiction in which failure to so qualify or to obtain such licenses and approvals would have a material adverse effect on its ability to perform its obligations under the Transaction Documents to which it is a party.
(c) The execution and delivery of the Transaction Documents to which Transferor is a party and the consummation of the transactions provided for in the Transaction Documents to which Transferor is a party have been duly authorized by Transferor by all necessary limited liability company action on its part. Transferor has the power and authority to assign the property to be assigned to and deposited with the Trust pursuant to Section 2.5 of this Agreement and Section 2.1 of the Transfer and Servicing Agreement.
(d) The execution and delivery of the Transaction Documents to which Transferor is a party, the performance of the transactions contemplated by the Transaction Documents to which Transferor is a party and the fulfillment of the terms hereof and thereof will not conflict with or violate any Requirements of Law applicable to 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 Transferor is a party or by which it or any of its properties are bound (other than violations of such indentures, contracts, agreements, mortgages, deeds of trust or other instruments which, individually or in the aggregate, would not have a material adverse effect on Transferor's ability to perform its obligations under this Agreement).
(e) There are no proceedings or investigations pending or, to the best knowledge of Transferor, threatened, against Transferor before any court, regulatory body, administrative agency, or other tribunal or governmental instrumentality having jurisdiction over Transferor (i) asserting the invalidity of any of the Transaction Documents to which Transferor is a party, (ii) seeking to prevent the consummation of any of the transactions contemplated by any of the Transaction Documents to which Transferor is a party, (iii) seeking any determination or ruling that, in the reasonable judgment of Transferor, would materially and adversely affect the performance by Transferor of its obligations under the Transaction Documents to which Transferor is a party, or (iv) seeking any determination or ruling that would materially and adversely affect the validity or enforceability of the Transaction Documents to which Transferor is a party.
(f) This Agreement is legal, valid and enforceable against Transferor.
Section 2.10. LIABILITY OF BENEFICIARIES. The Holders of the Transferor Interest, including the Holders of Supplemental Interests, if any, shall be entitled to the same limitation of personal liability extended to stockholders of private corporations for profit organized under the General Corporation Law of the State of Delaware.
ARTICLE III
BENEFICIAL INTERESTS
Section 3.1. INITIAL OWNERSHIP. Transferor, as the Holder of the Transferor Interest (i) shall initially be the only beneficial owner of the Trust and (ii) shall be bound by the provisions of this Trust Agreement.
Section 3.2. TRANSFEROR INTEREST. The Transferor Interest shall represent an undivided beneficial interest in the Trust Estate subject to the lien of the Notes created pursuant to the Indenture, including the right to receive Collections with respect to the Receivables and other amounts at the times and in the amounts
specified in the Indenture and any Indenture Supplement to be paid to the Holder of the Transferor Interest.
Section 3.3. FORM OF TRANSFEROR INTEREST. The Transferor Interest initially shall be an uncertificated interest in the Trust.
Section 3.4. RESTRICTIONS ON TRANSFER; ISSUANCE OF SUPPLEMENTAL INTERESTS. (a) Transferor may from time to time transfer a portion of the Transferor Interest by causing the issuance of one or more additional interests (each a "SUPPLEMENTAL INTEREST"), which shall be in uncertificated form. The form and terms of any Supplemental Interest shall be defined in a supplement to this Agreement (which supplement shall be subject to SECTION 10.1 to the extent that it amends any of the terms of this Agreement) to be delivered to or upon the order of Transferor (or the holder of a Supplemental Interest, in the case of the transfer or exchange thereof, as provided below). The issuance of any such Supplemental Interest to any Person shall be subject to satisfaction of the following conditions:
(i) the Rating Agency Condition shall have been satisfied with respect to such action; and
(ii) Transferor shall have delivered to Owner Trustee, Indenture Trustee and each Rating Agency a Tax Opinion, dated the date of such action (or transfer, exchange or other disposition provided below), with respect to such action and an Opinion of Counsel to the effect that such action, assignment, participation, pledge or other disposition does not require registration of the interest under the Securities Act or any state securities law except for any such registration that has been duly completed and become effective.
A Supplemental Interest may be transferred or exchanged, and the Transferor Interest may be pledged, only upon satisfaction of the conditions set forth in CLAUSE (ii).
(b) The Transferor Interest may be transferred in its entirety
to a Person which is a member of the "affiliated group" as defined in Section
1504(a) of the Code of which Transferor is a member without the consent or
approval of the Noteholders, provided that (i) the Rating Agency Condition
shall have been satisfied with respect to such transfer, (ii) Transferor
shall have delivered to Owner Trustee, Indenture Trustee and each Rating
Agency a Tax Opinion and an Opinion of Counsel of the type described in
SECTION 3.4(a)(ii), dated the date of such transfer, with respect thereto and
(iii) Transferor shall have delivered to Indenture Trustee an Officer's
Certificate stating that Transferor Amount shall not be less than the Minimum
Transferor Amount. In connection with any such transfer, the Person to whom
the Transferor Interest is transferred will, by its acquisition and holding
of an interest in the Transferor Interest, assume all of the rights and
obligations of Transferor as described in this Agreement, each Transaction
Document and in any supplement or amendment thereto (including
the right under this PARAGRAPH (b) with respect to subsequent transfers of an interest in the Transferor Interest).
ARTICLE IV
ACTIONS BY OWNER TRUSTEE
Section 4.1. PRIOR NOTICE TO TRANSFEROR WITH RESPECT TO CERTAIN MATTERS. With respect to the following matters, unless otherwise instructed by Transferor, the Trust shall not take action unless at least thirty (30) days before the taking of such action Owner Trustee shall have notified Transferor:
(a) the initiation of any claim or lawsuit by the Trust (other than an action to collect on the Trust Estate) and the settlement of any action, claim or lawsuit brought by or against the Trust (other than an action to collect on the Trust Estate);
(b) the election by the Trust to file an amendment to the Certificate of Trust;
(c) the amendment of the Indenture by a supplemental indenture in circumstances where the consent of any Noteholder is required;
(d) the amendment of the Indenture by a supplemental indenture in circumstances where the consent of any Noteholder is not required and such amendment materially adversely affects the interest of Transferor;
(e) the amendment, change or modification of the Administration Agreement, except to cure any ambiguity or to amend or supplement any provision in a manner that would not materially adversely affect the interests of Transferor; or
(f) the appointment pursuant to the Indenture of a replacement or successor Transfer Agent and Registrar or Indenture Trustee, or the consent to the assignment by the Transfer Agent and Registrar, Administrator or Indenture Trustee of its obligations under the Indenture.
Section 4.2. RESTRICTIONS ON POWER.
(a) Owner Trustee shall not be required to take or refrain from taking any action if such action or inaction would be contrary to any obligation of the Trust or Owner Trustee (as such or in its individual capacity) under any of the Transaction Documents or would be contrary to SECTION 2.3.
(b) Owner Trustee shall have no power to create, assume or incur indebtedness or other liabilities in the name of the Trust other than as contemplated by the Transaction Documents.
ARTICLE V
AUTHORITY AND DUTIES OF OWNER TRUSTEE
Section 5.1. GENERAL AUTHORITY. Each of the Trust and Owner Trustee in the name and on behalf of the Trust shall have power and authority, and is hereby authorized and empowered, to execute and deliver the Transaction Documents to which the Trust is to be a party and each certificate or other document attached as an exhibit to or contemplated by the Transaction Documents to which the Trust is to be a party, or any amendment thereto or other agreement, in each case, in such form as Transferor shall approve as evidenced conclusively by Owner Trustee's execution thereof and Transferor's execution of the related documents. In addition to the foregoing, Owner Trustee in the name and on behalf of the Trust shall also have power and authority and is hereby authorized and empowered, but shall not be obligated, to take all actions required of the Trust pursuant to the Transaction Documents. Owner Trustee in the name and on behalf of the Trust shall also have power and authority and is hereby authorized and empowered from time to time to take such action as Transferor or Administrator directs in writing with respect to the Transaction Documents.
Section 5.2. GENERAL DUTIES. It shall be the duty of Owner Trustee to discharge (or cause to be discharged) all of its responsibilities pursuant to the terms of this Agreement and the other Transaction Documents to which the Trust is a party and to administer the Trust in the interest of Transferor, subject to the Transaction Documents and in accordance with the provisions of this Agreement. Notwithstanding the foregoing, Owner Trustee shall be deemed to have discharged its duties and responsibilities hereunder and under the other Transaction Documents to the extent Administrator has agreed in the Administration Agreement or another Transaction Document to perform any act or to discharge any duty of Owner Trustee or the Trust under any Transaction Document, and Owner Trustee shall not be personally liable for the default or failure of Administrator to carry out its obligations under the Administration Agreement.
Section 5.3. ACTION UPON INSTRUCTION.
(a) Owner Trustee shall not be required to take any action hereunder or under any other Transaction Document if Owner Trustee shall have reasonably determined, or shall have been advised by counsel, that such action is likely to result in personal liability on the part of Owner Trustee or is contrary to the terms of any Transaction Document or is otherwise contrary to law.
(b) Whenever Owner Trustee is unable to decide between alternative courses of action permitted or required by the terms of any Transaction Document, Owner Trustee shall promptly give notice (in such form as shall be appropriate under the circumstances) to Transferor requesting instruction as to the course of action to be adopted, and to the extent Owner Trustee acts or refrains
from acting in good faith in accordance with any such instruction of Transferor received, Owner Trustee shall not be personally liable on account of such action or inaction to any Person. If Owner Trustee shall not have received appropriate instruction within ten (10) days of such notice (or within such shorter period of time as reasonably may be specified in such notice or may be necessary under the circumstances) it may, but shall be under no duty to, take or refrain from taking such action, not in violation of the Transaction Documents, as it shall deem to be in the best interest of Transferor, and shall have no personal liability to any Person for such action or inaction.
(c) In the event that Owner Trustee is unsure as to the application of any provision of any Transaction Document or any such provision is ambiguous as to its application, or is, or appears to be, in conflict with any other applicable provision, or in the event that this Agreement permits any determination by Owner Trustee or is silent or is incomplete as to the course of action that Owner Trustee is required to take with respect to a particular set of facts, Owner Trustee may give notice (in such form as shall be appropriate under the circumstances) to Transferor requesting instruction and, to the extent that Owner Trustee acts or refrains from acting in good faith in accordance with any such instruction received, Owner Trustee shall not be personally liable, on account of such action or inaction, to any Person. If Owner Trustee shall not have received appropriate instruction within ten (10) days of such notice (or within such shorter period of time as reasonably may be specified in such notice or may be necessary under the circumstances) it may, but shall be under no duty to, take or refrain from taking such action, not in violation of the Transaction Documents, as it shall deem to be in the best interests of Transferor, and shall have no personal liability to any Person for such action or inaction.
(d) The Administrator and the Transferor may, by written instruction, direct the Owner Trustee in the administration of the Trust to the extent permitted by this Agreement and the Administration Agreement.
Section 5.4. NO DUTIES EXCEPT AS SPECIFIED IN THIS AGREEMENT OR IN INSTRUCTIONS. Owner Trustee shall not have any duty or obligation to manage, make any payment with respect to, register, record, sell, dispose of, or otherwise deal with the Trust or the Trust Estate, or to otherwise take or refrain from taking any action under, or in connection with, this Agreement or any document contemplated hereby to which the Trust is a party, except as expressly provided by the terms of this Agreement or in any document or written instruction received by Owner Trustee pursuant to SECTION 5.3; and no implied duties or obligations shall be read into any Transaction Document against Owner Trustee. Owner Trustee shall have no responsibility for any filing or recording, including filing any financing or continuation statement in any public office at any time or to otherwise perfect or maintain the perfection of any security interest or lien granted to it or the Trust hereunder or to prepare or file any Commission filing for the Trust, or to prepare any tax forms, returns or reports or to record any Transaction
Document. Owner Trustee in its individual capacity nevertheless agrees that it will, at its own cost and expense, promptly take all action as may be necessary to discharge any liens on any part of the Trust Estate that result from actions by, or claims against, Owner Trustee in its individual capacity that are not related to the ownership or the administration of the Trust Estate or the transactions contemplated by the Transaction Documents.
Section 5.5. NO ACTION EXCEPT UNDER TRANSACTION DOCUMENTS OR INSTRUCTIONS. Owner Trustee shall not manage, control, use, sell, dispose of or otherwise deal with any part of the Trust Estate except (i) in accordance with the powers granted to and the authority conferred upon Owner Trustee pursuant to this Agreement, (ii) in accordance with the Transaction Documents and (iii) in accordance with any document or instruction delivered to Owner Trustee pursuant to SECTION 5.3.
Section 5.6. RESTRICTIONS. Owner Trustee shall not take any action (a) that, to the actual knowledge of a Responsible Officer of Owner Trustee, would violate the purposes of the Trust set forth in SECTION 2.3 or (b) that, to the actual knowledge of a Responsible Officer of Owner Trustee, would result in the Trust's becoming taxable as a corporation for federal income tax purposes. Transferor shall not direct Owner Trustee to take action that would violate the provisions of this SECTION 5.6.
Section 5.7. TAX RETURNS. In the event the Trust shall be required to
file tax returns, Administrator shall prepare or shall cause to be prepared such
tax returns and shall provide such tax returns to Owner Trustee for signature at
least five (5) days before such tax returns are due to be filed. Administrator,
in accordance with the terms of each Indenture Supplement, shall also prepare or
shall cause to be prepared all tax information required by law to be distributed
to Noteholders and shall deliver such information to Owner Trustee at least five
(5) days prior to the date it is required by law to be distributed to
Noteholders. Owner Trustee, upon request, will furnish Administrator with all
such information known to Owner Trustee as may be reasonably required in
connection with the preparation of all tax returns of the Trust, and shall, upon
request, execute such returns. In no event shall Owner Trustee or Indenture
Trustee be liable for any liabilities, costs or expenses of the Trust or any
Noteholder arising under any tax law, including federal, state or local income
or excise taxes or any other tax imposed on or measured by income (or any
interest or penalty with respect thereto arising from a failure to comply
therewith).
ARTICLE VI
CONCERNING OWNER TRUSTEE
Section 6.1. ACCEPTANCE OF TRUSTS AND DUTIES. Owner Trustee accepts the trusts hereby created and agrees to perform its duties hereunder with respect to such trusts, but only upon the terms of this Agreement. Owner Trustee also agrees
to disburse all moneys actually received by it constituting part of the Trust Estate upon the terms of the Transaction Documents. Owner Trustee shall not be personally answerable or accountable under any Transaction Document under any circumstances, except (i) for its own willful misconduct, bad faith or gross negligence in the performance of its duties or the omission to perform any such duties or (ii) in the case of the inaccuracy of any representation or warranty contained in SECTION 6.3 expressly made by Owner Trustee in its individual capacity. In particular, but not by way of limitation (and subject to the exceptions set forth in the preceding sentence):
(a) Owner Trustee shall not be personally liable for any error of judgment made in good faith by Owner Trustee;
(b) Owner Trustee shall not be personally liable with respect to any action taken or omitted to be taken by it in accordance with the instructions of Administrator or Transferor;
(c) no provision of this Agreement or any other Transaction Document shall require Owner Trustee to expend or risk funds or otherwise incur any personal financial liability in the exercise or performance of any of its duties, rights or powers hereunder or under any other Transaction Document, if Owner Trustee shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured or provided to it (as such and in its individual capacity);
(d) under no circumstances shall Owner Trustee be personally liable for indebtedness evidenced by or arising under any of the Transaction Documents, including the principal of and interest on the Notes;
(e) Owner Trustee shall not be personally responsible for or in respect of the validity or sufficiency of this Agreement, the due execution hereof by Transferor or the form, character, genuineness, sufficiency, value or validity of any of the Trust Estate, the Transaction Documents, the Notes or the Transferor Interest, and Owner Trustee shall in no event assume or incur any personal liability, duty, or obligation to any Noteholder, Transferor, any Holder of the Transferor Interest or any other Person, other than as expressly provided for herein or expressly agreed to in the other Transaction Documents;
(f) Owner Trustee shall not be personally liable for the default or misconduct of, and shall have no duty to monitor the performance of, Transferor, Servicer, Administrator or Indenture Trustee or any other Person under any of the Transaction Documents or otherwise, and Owner Trustee shall have no obligation or personal liability to perform the obligations of the Trust under the Transaction Documents, including those that are required to be performed by Administrator under the Administration Agreement, Indenture Trustee under the Indenture or Servicer under the Transfer and Servicing Agreement;
(g) Owner 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 under this Agreement or otherwise or in relation to any Transaction Document, at the request, order or direction of Transferor, unless the Transferor has offered to Owner Trustee (as such and in its individual capacity) security or indemnity satisfactory to it against the costs, expenses and liabilities that may be incurred by Owner Trustee therein or thereby. The right of Owner Trustee to perform any discretionary act enumerated in any Transaction Document shall not be construed as a duty, and Owner Trustee shall not be answerable or personally liable to any Person for any such act other than liability to the Trust and the beneficial owners of the Trust for its own gross negligence, bad faith or willful misconduct in the performance of any such act or the omission to perform any such act; and
(h) Notwithstanding anything contained herein to the contrary, Owner Trustee shall not be required to take any action in any jurisdiction other than in the State of Delaware if the taking of such action will (i) require the registration with, licensing by or the taking of any other similar action in respect of, any State or other governmental authority or agency of any jurisdiction other than the State of Delaware by or with respect to Owner Trustee (as such or in its individual capacity); (ii) result in any fee, tax or other governmental charge under the laws of any jurisdiction or any political subdivisions thereof in existence on the date hereof other than the State of Delaware becoming payable by Owner Trustee (as such or in its individual capacity); or (iii) subject Owner Trustee (as such or in its individual capacity) to personal jurisdiction in any jurisdiction other than the State of Delaware for causes of action arising from acts unrelated to the consummation of the transactions by Owner Trustee contemplated hereby. Owner Trustee shall be entitled to obtain advice of counsel (which advice shall be an expense of Transferor) to determine whether any action required to be taken pursuant to the Agreement results in the consequences described in clauses (i), (ii) and (iii) of the preceding sentence. In the event that said counsel advises Owner Trustee that such action will result in such consequences, Transferor shall appoint an additional trustee pursuant to SECTION 9.5 to proceed with such action.
Section 6.2. FURNISHING OF DOCUMENTS. Owner Trustee shall furnish to Transferor and Indenture Trustee, promptly upon written request therefor, duplicates or copies of all reports, notices, requests, demands, certificates, financial statements and any other instruments furnished to Owner Trustee under the Transaction Documents.
Section 6.3. REPRESENTATIONS AND WARRANTIES. Owner Trustee (as such and in its individual capacity) hereby represents and warrants to Transferor that:
(a) It is a national banking association duly organized and validly existing in good standing under the federal laws of the United States. It has all requisite corporate power and authority to execute, deliver and perform its obligations under this Agreement.
(b) It has taken all corporate action necessary to authorize the execution and delivery by it of this Agreement, and this Agreement will be executed and delivered by one of its officers who is duly authorized to execute and deliver this Agreement on its behalf.
(c) Neither the execution nor the delivery by it of this Agreement, nor the consummation by it of the transactions contemplated hereby nor compliance by it with any of the terms or provisions hereof will contravene any federal or Delaware law, governmental rule or regulation governing the banking or trust powers of Owner Trustee (as such and in its individual capacity) or any judgment or order binding on it, or constitute any default under its charter documents or by-laws or any indenture, mortgage, contract, agreement or instrument to which it is a party or by which any of its properties may be bound.
Section 6.4. RELIANCE; ADVICE OF COUNSEL.
(a) Owner Trustee shall incur no personal liability to anyone in acting upon any signature, instrument, notice, resolution, request, consent, order, certificate, report, opinion, bond, or other document or paper reasonably believed by it to be genuine and reasonably believed by it to be signed by the proper party or parties. Owner Trustee may accept a certified copy of a resolution of the board of directors or other governing body of any Person as conclusive evidence that such resolution has been duly adopted by such body and that the same is in full force and effect. As to any fact or matter the method of the determination of which is not specifically prescribed herein, Owner Trustee may for all purposes hereof rely on a certificate, signed by the president or any vice president or by the treasurer or other authorized officer of an appropriate Person, as to such fact or matter, and such certificate shall constitute full protection to Owner Trustee for any action taken or omitted to be taken by it in good faith in reliance thereon.
(b) In the exercise or administration of the trusts hereunder and in the performance of its duties and obligations under this Agreement or the other Transaction Documents, Owner Trustee (i) may act directly or through agents or attorneys pursuant to agreements entered into with any of them, and Owner Trustee shall not be personally liable for the conduct or misconduct of such agents or attorneys if such agents or attorneys shall have been selected by Owner Trustee in good faith, and (ii) may consult with counsel, accountants and other skilled Persons to be selected in good faith and employed by it. Owner Trustee shall not be personally liable for anything done, suffered or omitted in good faith by it in accordance with the written opinion or written advice of any such counsel, accountants or other such Persons.
Section 6.5. NOT ACTING IN INDIVIDUAL CAPACITY. Except as expressly provided in this ARTICLE VI, in accepting the trusts hereby created, Chase Manhattan Bank USA, National Association acts solely as Owner Trustee hereunder and not in its individual capacity, and all Persons having any claim against Owner Trustee by reason of the transactions contemplated by any
Transaction Document shall look only to the Trust Estate for payment or satisfaction thereof.
Section 6.6. OWNER TRUSTEE NOT LIABLE FOR NOTES OR RECEIVABLES. The statements contained herein and in the Notes and other Transaction Documents (other than the representations and warranties in SECTION 6.3) shall be taken as the statements of Transferor, and Owner Trustee assumes no responsibility for the correctness thereof. Owner Trustee makes no representations as to the validity or sufficiency of this Agreement or any other Transaction Document, the Notes or related documents. Owner Trustee shall at no time have any responsibility or personal liability for or with respect to the legality, validity and enforceability of the Receivables or the perfection and priority of any security interest in the Receivables or the maintenance of any such perfection and priority, or for or with respect to the sufficiency of the Trust Estate or its ability to generate the payments to be distributed to the Noteholders under the Indenture, including the existence, condition and ownership of the Receivables; the existence and contents of the Receivables on any computer or other record thereof; the validity of the assignment of the Receivables to the Trust or of any intervening assignment; the completeness of the Receivables; the performance or enforcement of the Receivables; the compliance by Transferor with any warranty or representation made under any Transaction Document or in any related document or the accuracy of any such warranty or representation or any action of Administrator, Servicer or Indenture Trustee taken in the name of Owner Trustee.
Section 6.7. OWNER TRUSTEE MAY OWN NOTES. Owner Trustee may become the owner or pledgee of Notes. If Owner Trustee becomes the owner or pledgee of Notes it shall have the same rights as it would have if it were not Owner Trustee. Owner Trustee may deal with Transferor, Administrator, Servicer and Indenture Trustee in banking transactions with the same rights as it would have if it were not Owner Trustee.
ARTICLE VII
COMPENSATION OF OWNER TRUSTEE
Section 7.1. OWNER TRUSTEE'S FEES AND EXPENSES. Owner Trustee (in its individual capacity) shall receive as compensation for its services hereunder such fees as have been separately agreed upon before the date hereof between Transferor and Owner Trustee (in its individual capacity) (which compensation shall not be limited by any law on compensation of a trustee of an express trust), and Owner Trustee (in its individual capacity) shall be entitled to be reimbursed by Transferor for its other reasonable expenses hereunder, including the reasonable compensation, expenses and disbursements of such agents, representatives, experts and counsel as Owner Trustee may employ in connection with the exercise and performance of its rights and its duties hereunder and under the Transaction Documents; PROVIDED, HOWEVER, that Owner Trustee shall have no recourse to the assets pledged under the Indenture with respect to any payments
pursuant to this SECTION 7.1 and Owner Trustee's right to enforce such obligation shall be subject to the provisions of SECTION 10.8.
Section 7.2. INDEMNIFICATION. To the fullest extent permitted by law, Transferor shall indemnify, defend and hold harmless Owner Trustee (as such and in its individual capacity) and its successors, assigns, directors, officers, agents, employees and servants (each an "INDEMNIFIED PARTY" and collectively, the "INDEMNIFIED PARTIES") from and against, any and all liabilities, obligations, losses, damages, taxes, claims, actions and suits, and any and all reasonable costs, expenses and disbursements (including reasonable legal fees and expenses) of any kind and nature whatsoever (collectively, "EXPENSES") which may at any time be imposed on, incurred by, or asserted against Owner Trustee or any Indemnified Party in any way relating to or arising out of the Transaction Documents, the Trust Estate, the acceptance and administration of the Trust Estate or any action or inaction of Owner Trustee; PROVIDED that Transferor shall not be liable for or required to indemnify any Indemnified Party from and against Expenses arising or resulting from any of the matters described in the third sentence of SECTION 6.1 or Expenses for which indemnification is actually received under other Transaction Documents; provided further that Transferor shall not be liable for or required to indemnify an Indemnified Party from and against expenses arising or resulting from (i) the Indemnified Party's own willful misconduct, bad faith or gross negligence, or (ii) the inaccuracy of any representation or warranty contained in SECTION 6.3. No Indemnified Party shall have recourse to the assets pledged under the Indenture with respect to any Expenses payable by Transferor pursuant to this SECTION 7.2. An Indemnified Party's right to enforce such obligation shall be subject to the provisions of SECTION 10.8. The indemnities contained in this SECTION 7.2 shall survive the resignation and termination of Owner Trustee or the termination of this Agreement.
Section 7.3. PAYMENTS TO OWNER TRUSTEE. Any amounts paid to Owner Trustee or any other Indemnified Party pursuant to this ARTICLE VII shall not be construed to be a part of the Trust Estate.
ARTICLE VIII
TERMINATION OF TRUST AGREEMENT
Section 8.1. TERMINATION OF TRUST AGREEMENT.
(a) The Trust shall dissolve upon the date specified by Transferor (the "TRUST TERMINATION DATE", written notice of which shall be provided to Owner Trustee), PROVIDED that the Trust Termination Date shall not be earlier than the day on which the rights of all Series of Notes to receive payments from the Trust have terminated. After satisfaction of liabilities of the Trust as provided by applicable law, any money or other property held as part of the Trust Estate following such distribution shall be distributed to Transferor. The bankruptcy, liquidation, dissolution, termination, death or incapacity of Transferor shall not
(x) operate to terminate this Agreement or annul, dissolve or terminate the Trust, or (y) entitle Transferor's legal representatives or heirs to claim an accounting or to take any action or proceeding in any court for a partition or winding up of all or any part of the Trust or Trust Estate or (z) otherwise affect the rights, obligations and liabilities of the parties hereto.
(b) Except as provided in SECTION 8.1(a), neither Transferor nor any Holder of the Transferor Interest shall be entitled to revoke, dissolve or terminate the Trust.
(c) Upon completion of the winding up of the Trust in accordance with the Business Trust Statute, Owner Trustee shall cause the Certificate of Trust to be canceled by filing a certificate of cancellation with the Secretary of State of the State of Delaware in accordance with the provisions of Section 3810 of the Business Trust Statute and thereupon the Trust and this Agreement (other than ARTICLES VI and VII and SECTION 10.8) shall terminate.
ARTICLE IX
SUCCESSOR OWNER TRUSTEES AND ADDITIONAL OWNER TRUSTEES
Section 9.1. ELIGIBILITY REQUIREMENTS FOR OWNER TRUSTEE. Owner Trustee shall at all times be a Person satisfying the provisions of Section 3807(a) of the Business Trust Statute; authorized to exercise trust powers; having a combined capital and surplus of at least $50,000,000 and subject to supervision or examination by federal or state authorities; and having (or having a parent which has) a rating of at least Baa3 by Moody's, at least BBB- by Standard & Poor's and, if rated by Fitch, at least BBB- by Fitch, or otherwise satisfactory to each Rating Agency. If such Person shall publish 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 9.1, the combined capital and surplus of such Person 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 Owner Trustee shall cease to be eligible in accordance with the provisions of this SECTION 9.1, Owner Trustee shall resign immediately in the manner and with the effect specified in SECTION 9.2.
Section 9.2. RESIGNATION OR REMOVAL OF OWNER TRUSTEE. Owner Trustee may at any time resign and be discharged from the trusts hereby created by giving written notice thereof to Transferor; PROVIDED, HOWEVER, that such resignation and discharge shall only be effective upon the appointment of a successor Owner Trustee. Upon receiving such notice of resignation, Transferor shall promptly appoint a successor Owner Trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to the resigning Owner Trustee and one copy to the successor Owner Trustee. If no successor Owner Trustee shall have been so appointed and have accepted appointment within thirty (30) days after the giving of such notice of resignation, the resigning Owner Trustee at the expense
of Transferor may petition any court of competent jurisdiction for the appointment of a successor Owner Trustee.
If at any time Owner Trustee shall cease to be eligible in accordance with the provisions of SECTION 9.1 and shall fail to resign after written request therefor by Transferor, or if at any time Owner Trustee shall be legally unable to act, or shall be adjudged bankrupt or insolvent, or a receiver of Owner Trustee or of its property shall be appointed, or any public officer shall take charge or control of Owner Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then Transferor may, but shall not be required to, remove Owner Trustee. If Transferor shall remove Owner Trustee under the authority of the immediately preceding sentence, Transferor shall promptly (i) appoint a successor Owner Trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to the outgoing Owner Trustee so removed and one copy to the successor Owner Trustee and (ii) pay all amounts owed to the outgoing Owner Trustee in its individual capacity.
Any resignation or removal of Owner Trustee and appointment of a successor Owner Trustee pursuant to any of the provisions of this SECTION 9.2 shall not become effective until acceptance of appointment by the successor Owner Trustee pursuant to SECTION 9.3 and, in the case of removal, payment of all fees and expenses owed to the outgoing Owner Trustee (as such or in its individual capacity). Transferor shall provide notice of such resignation or removal of Owner Trustee to each Rating Agency.
Section 9.3. SUCCESSOR OWNER TRUSTEE. Any successor Owner Trustee appointed pursuant to SECTION 9.2 shall execute, acknowledge and deliver to Transferor and to its predecessor Owner Trustee an instrument accepting such appointment under this Agreement, and thereupon the resignation or removal of the predecessor Owner Trustee shall become effective and such successor Owner Trustee, without any further act, deed or conveyance, shall become fully vested with all the rights, powers, duties, and obligations of its predecessor under this Agreement, with like effect as if originally named as Owner Trustee. The predecessor Owner Trustee shall upon payment of its fees and expenses deliver to the successor Owner Trustee all documents and statements and monies held by it under this Agreement; and Transferor and the predecessor Owner 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 Owner Trustee all such rights, powers, duties, and obligations.
No successor Owner Trustee shall accept appointment as provided in this
SECTION 9.3 unless at the time of such acceptance such successor Owner Trustee
shall be eligible pursuant to SECTION 9.1.
Upon acceptance of appointment by a successor Owner Trustee pursuant to this SECTION 9.3, Transferor shall mail notice of such acceptance of appointment including the name of such successor Owner Trustee to Transferor, Indenture
Trustee, the Noteholders and each Rating Agency. If Transferor shall fail to mail such notice within ten (10) days after acceptance of appointment by the successor Owner Trustee, the successor Owner Trustee shall cause such notice to be mailed at the expense of Transferor.
Upon acceptance of appointment by a successor Owner Trustee pursuant to this SECTION 9.3, such successor Owner Trustee shall file an amendment to the Certificate of Trust with the Secretary of State of the State of Delaware identifying the name and principal place of business of such successor Owner Trustee in the State of Delaware.
Section 9.4. MERGER OR CONSOLIDATION OF OWNER TRUSTEE. Notwithstanding anything herein to the contrary, any Person into which Owner 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 Owner Trustee shall be a party, or any Person succeeding to all or substantially all of the corporate trust business of Owner Trustee, shall be the successor of Owner Trustee hereunder (PROVIDED that such Person shall meet the eligibility requirements set forth in SECTION 9.1), without the execution or filing of any instrument or any further act on the part of any of the parties hereto; PROVIDED FURTHER that (a) Owner Trustee shall mail notice of such merger or consolidation to each Rating Agency and (b) Owner Trustee shall file any necessary amendments to the Certificate of Trust with the Secretary of State of the State of Delaware.
Section 9.5. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. Notwithstanding any other provisions of this Agreement, at any time, for the purpose of meeting any legal requirements of any jurisdiction in which any part of the Trust Estate may at the time be located, Transferor and Owner Trustee acting jointly shall have the power and shall execute and deliver all instruments to appoint one or more Persons approved by each of Transferor and Owner Trustee to act as co-trustee, jointly with Owner Trustee, or separate trustee or separate trustees, of all or any part of the Trust Estate, and to vest in such Person, in such capacity, such title to the Trust, or any part thereof, and, subject to the other provisions of this SECTION 9.5, such powers, duties, obligations, rights and trusts as Transferor and Owner Trustee may consider necessary or desirable. If Transferor shall not have joined in such appointment within fifteen (15) days after the receipt by it of a request so to do, Owner Trustee alone shall have the power to make such appointment. no co-trustee or separate trustee under this Agreement shall be required to meet the terms of eligibility as a successor trustee pursuant to SECTION 9.1 and no notice of the appointment of any co-trustee or separate trustee shall be required pursuant to SECTION 9.3.
Each separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties, and obligations conferred or imposed upon Owner Trustee shall be conferred upon and exercised or
performed by Owner 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 Owner 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, Owner 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 Owner Trustee;
(ii) no trustee under this Agreement shall be personally liable by reason of any act or omission of any other trustee under this Agreement; and
(iii) Transferor and Owner Trustee acting jointly may at any time accept the resignation of or remove any separate trustee or co-trustee.
Any notice, request or other writing given to Owner 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 IX. 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 Owner 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, Owner Trustee. Each such instrument shall be filed with Owner Trustee and a copy thereof given to Transferor.
Any separate trustee or co-trustee may at any time appoint Owner Trustee, its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect of this Agreement on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by Owner Trustee, to the extent permitted by law, without the appointment of a new or successor trustee.
ARTICLE X
MISCELLANEOUS
Section 10.1. SUPPLEMENTS AND AMENDMENTS. This Agreement may be amended from time to time, by a written amendment duly executed and delivered by Transferor and Owner Trustee, without the consent of any of the Noteholders, to cure any ambiguity, to correct or supplement any provisions in this Agreement or to add any other provisions with respect to matters or questions raised under
this Agreement which shall not be inconsistent with the provisions of this Agreement; PROVIDED, HOWEVER, that such amendment will not, as evidenced by an Officer's Certificate of Transferor addressed and delivered to Owner Trustee and Indenture Trustee, materially and adversely affect the interest of any Noteholder. In addition, this Agreement may be amended from time to time, by a written amendment duly executed and delivered by Transferor and Owner Trustee, without the consent of any of the Noteholders, and upon satisfaction of the Rating Agency Condition, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or modifying in any manner the rights of the Noteholders; PROVIDED, HOWEVER, that such amendment will not (i) as evidenced by an Officer's Certificate of Transferor addressed and delivered to Owner Trustee and Indenture Trustee, materially and adversely affect the interest of any Noteholder and (ii) as evidenced by an Opinion of Counsel addressed and delivered to Owner Trustee and Indenture Trustee, cause the Trust to be classified as an association (or a publicly traded partnership) taxable as a corporation for federal income tax purposes; PROVIDED, FURTHER, that SECTION 2.3 of this Agreement may be amended only with the consent of the Holders of Notes evidencing not less than a majority of the Outstanding Amount of the Notes. Additionally, notwithstanding the preceding sentence, this Agreement will be amended by Transferor and Owner Trustee without the consent of Indenture Trustee or any of the Noteholders to add, modify or eliminate such provisions as may be necessary or advisable in order to enable all or a portion of the Trust (i) to qualify as, and to permit an election to be made to cause the Trust to be treated as, a "financial asset securitization investment trust" as described in the provisions of Section 860L of the Code, and (ii) to avoid the imposition of state or local income or franchise taxes imposed on the Trust's property or its income; PROVIDED, HOWEVER, that (i) Transferor delivers to Indenture Trustee and Owner Trustee an Officer's Certificate to the effect that the proposed amendments meet the requirements set forth in this subsection, (ii) the Rating Agency Condition shall have been satisfied with respect to such amendment and (iii) such amendment does not affect the rights, benefits, protections, privileges, immunities, duties or obligations of Owner Trustee hereunder. The amendments which Transferor may make without the consent of Noteholders pursuant to the preceding sentence may include the addition of a Transferor of Receivables.
This Agreement may also be amended from time to time by a written amendment duly executed and delivered by Transferor and Owner Trustee, with the consent of Indenture Trustee and the Holders of Notes evidencing not less than 66 2/3% of the Outstanding Amount of the Notes, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or of modifying in any manner the rights of the Noteholders; PROVIDED, HOWEVER, that without the consent of all Noteholders, no such amendment shall (a) increase or reduce in any manner the amount of, or accelerate or delay the timing of distributions that are required to be made for the benefit of the Noteholders or (b) reduce the aforesaid percentage of the
Outstanding Amount of the Notes, the Holders of which are required to consent to any such amendment; PROVIDED FURTHER, that such amendment will not, as evidenced by an Opinion of Counsel addressed and delivered to Owner Trustee and Indenture Trustee, cause the Trust to be classified as an association (or a publicly traded partnership) taxable as a corporation for federal income tax purposes.
Promptly after the execution of any such amendment or consent, Transferor shall furnish written notification of the substance of such amendment or consent to Indenture Trustee and each Rating Agency.
It shall not be necessary for the consent of the Noteholders pursuant to this SECTION 10.1 to approve the particular form of any proposed amendment or consent, but it shall be sufficient if such consent shall approve the substance thereof
Promptly after the execution of any amendment to the Certificate of Trust, Owner Trustee shall cause the filing of such amendment with the Secretary of State of the State of Delaware.
Owner Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Officer's Certificate of Transferor to the effect that the conditions to amendment have been satisfied.
Owner Trustee may, but shall not be obligated to, enter into, and unless it has consented thereto in writing shall not be bound by, any amendment which affects Owner Trustee's own rights, duties, benefits, protections, privileges or immunities (as such or in its individual capacity) under this Agreement or otherwise.
Section 10.2. NO LEGAL TITLE TO TRUST ESTATE IN TRANSFEROR. Transferor shall not have legal title to any part of the Trust Estate. No transfer, by operation of law or otherwise, of any right, title, and interest of Transferor to and in its undivided beneficial interest in the Trust Estate shall operate to terminate this Agreement or annul, dissolve or terminate the Trust or entitle any transferee to an accounting or to the transfer to it of legal title to any part of the Trust Estate.
Section 10.3. LIMITATIONS ON RIGHTS OF OTHERS. The provisions of this Agreement are solely for the benefit of Owner Trustee (as such or in its individual capacity), the other Indemnified Parties, Transferor, and, to the extent expressly provided herein, Indenture Trustee and the Noteholders, and nothing in this Agreement, whether express or implied, shall be construed to give to any other Person any legal or equitable right, remedy or claim in the Trust Estate or under or in respect of this Agreement or any covenants, conditions or provisions contained herein.
Section 10.4. NOTICES. Unless otherwise expressly specified or permitted by the terms hereof, all notices and other communications shall be in writing and shall be deemed given upon receipt by the intended recipient or three (3) Business Days after mailing if mailed by certified mail, postage prepaid (except that notice to Owner Trustee, Transferor or Indenture Trustee shall be deemed given only upon actual receipt by Owner Trustee, Transferor or Indenture Trustee), if to Owner Trustee, addressed to the Corporate Trust Office; if to Indenture Trustee, addressed to BNY Midwest Trust Company, 2 North LaSalle Street, Suite 1020, Chicago, Illinois 60602; if to Transferor, addressed to WFN Credit Company, LLC, 220 West Schrock Road, Westerville, Ohio 43801, Attn: President; or, as to each party, at such other address as shall be designated by such party in a written notice to each other party.
Section 10.5. SEVERABILITY. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
Section 10.6. SEPARATE COUNTERPARTS. This Agreement may be executed by the parties hereto in separate counterparts, each of which when so executed and delivered shall be an original, but all such counterparts shall together constitute but one and the same instrument.
Section 10.7. SUCCESSORS AND ASSIGNS. All covenants and agreements contained herein shall be binding upon, and inure to the benefit of, Transferor and its permitted assignees and Owner Trustee (as such or in its individual capacity) and its successors, all as herein provided. Any request, notice, direction, consent, waiver or other instrument or action by Transferor shall bind the successors and assigns of Transferor.
Section 10.8. NON-PETITION COVENANTS. Notwithstanding any prior termination of the Trust or this Agreement, Chase Manhattan Bank USA, National Association, individually or in its capacity as Owner Trustee, shall not at any time institute against the Trust, Transferor or Certificate Trust, or solicit or join or cooperate with or encourage any institution against the Trust, Transferor or Certificate Trust of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law in connection with any obligation relating to the Notes, this Agreement or any of the Transaction Documents; PROVIDED, HOWEVER, that this SECTION 10.8 shall not operate to preclude any remedy described in ARTICLE V of the Indenture.
Notwithstanding any prior termination of the Trust or this Agreement, Transferor shall not at any time institute against the Trust or Certificate Trust, or solicit or join or cooperate with or encourage any institution against the Trust or
Certificate Trust of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Notes, this Agreement or any of the Transaction Documents; PROVIDED, HOWEVER, that this SECTION 10.8 shall not operate to preclude any remedy described in ARTICLE V of the Indenture.
Section 10.9. NO RECOURSE. Each Person holding or owning the Transferor Interest (or any interest therein), by accepting the Transferor Interest (or its interest therein), acknowledges that the Transferor Interest does not represent an interest in or obligation of Servicer, Owner Trustee (as such or in its individual capacity), Indenture Trustee or any Affiliate thereof (other than the Trust), and no recourse may be had against such parties or their assets, or against the assets pledged under the Indenture, except as expressly provided in the Transaction Documents.
Section 10.10. HEADINGS. The headings of the various Articles and Sections herein are for convenience of reference only and shall not define or limit any of the terms or provisions hereof.
Section 10.11. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF DELAWARE, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS AND THE OBLIGATIONS, RIGHTS, AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 10.12. INTEGRATION OF DOCUMENTS. This Agreement constitutes the entire agreement of the parties hereto and thereto with respect to the subject matter hereof and supersedes all prior agreements relating to the subject matter hereof.
[Signature Page to Follow]
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective officers hereunto duly authorized, as of the day and year first above written.
CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION,
as Owner Trustee
By: /s/ Denis Kelly
-----------------------------------
Name: Denis Kelly
Title: Assistant Vice President
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WFN CREDIT COMPANY, LLC,
as Transferor
By: /s/ Robert P. Armiak
-------------------------------------
Name: Robert P. Armiak
Title: Vice President and Treasurer
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Exhibit 4.5
ADMINISTRATION AGREEMENT
between
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
Issuer,
and
WORLD FINANCIAL NETWORK NATIONAL BANK
Administrator
Dated as of August 1, 2001
TABLE OF CONTENTS
PAGE
1. Duties of Administrator....................................................1
2. Records....................................................................6
3. Compensation...............................................................7
4. Additional Information to be Furnished to Issuer...........................7
5. Independence of Administrator..............................................7
6. No Joint Venture...........................................................7
7. Other Activities of Administrator..........................................7
8. Term of Agreement; Resignation and Removal of Administrator................7
9. Action upon Termination, Resignation or Removal............................9
10. Notices....................................................................9
11. Amendments.................................................................9
12. Successors and Assigns....................................................10
13. GOVERNING LAW.............................................................10
14. Headings..................................................................11
15. Counterparts..............................................................11
16. Severability..............................................................11
17. Not Applicable to WFN in Other Capacities.................................11
18. Limitation of Liability of Owner Trustee..................................11
19. Third-Party Beneficiary...................................................11
20. Nonpetition Covenants.....................................................11
21. Successor Administrator...................................................11
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Exhibit A Power of Attorney
ADMINISTRATION AGREEMENT, dated as of August 1, 2001 (this
"AGREEMENT"), between WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST, a
business trust organized and existing under the laws of the State of Delaware
("ISSUER"), and WORLD FINANCIAL NETWORK NATIONAL BANK, a national banking
association, as administrator ("ADMINISTRATOR").
W I T N E S S E T H :
WHEREAS, Issuer has entered into a Master Indenture, dated as of August 1, 2001 (the "INDENTURE"), between Issuer and BNY Midwest Trust Company, as indenture trustee ("INDENTURE TRUSTEE"), to provide for the issuance of its asset backed notes (the "NOTES") from time to time pursuant to one or more indenture supplements. Capitalized terms used herein and not defined herein shall have the meanings assigned to such terms in ANNEX A to the Indenture;
WHEREAS, Issuer has entered into certain agreements in connection with the issuance of the Notes, the issuance of the Transferor Interest and transactions related thereto, including (i) the Transfer and Servicing Agreement, (ii) the Trust Agreement, and (iii) the Indenture (the Transfer and Servicing Agreement, the Trust Agreement, the Indenture and all Indenture Supplements being hereinafter referred to collectively as the "RELATED AGREEMENTS");
WHEREAS, pursuant to the Related Agreements, Issuer and Owner Trustee are required to perform certain duties in connection with (a) the Notes and the Collateral and (b) the Transferor Interest;
WHEREAS, Issuer and Owner Trustee desire to have Administrator perform certain of the duties of Issuer and Owner Trustee referred to in the preceding clause, and to provide such additional services consistent with the terms of this Agreement and the Related Agreements as Issuer and Owner Trustee may from time to time request; and
WHEREAS, Administrator has the capacity to provide the services required hereby and is willing to perform such services for Issuer and Owner Trustee on the terms set forth herein;
NOW, THEREFORE, in consideration of the mutual covenants contained herein, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree as follows:
1. DUTIES OF ADMINISTRATOR.
(a) DUTIES WITH RESPECT TO THE RELATED AGREEMENTS. Administrator shall consult with Owner Trustee regarding the duties of Issuer and Owner Trustee under the Related Agreements. Administrator shall monitor the performance of Issuer and shall advise Owner Trustee when action is necessary to comply with Issuer's or Owner Trustee's duties under the Related Agreements.
Administrator shall prepare for execution by Issuer or Owner Trustee or shall cause the preparation by other appropriate persons of all such documents, reports, filings, instruments, orders, certificates and opinions as it shall be the duty of Issuer or Owner Trustee to prepare, file or deliver pursuant to any Related Agreement. In furtherance of the foregoing, Administrator shall take all appropriate action that it is the duty of Issuer or Owner Trustee to take pursuant to the Indenture including such of the foregoing as are required with respect to the following matters under the Indenture (references are to sections of the Indenture):
(i) the preparation of or obtaining of the documents and instruments required for execution, authentication and delivery of the Notes (whether upon initial issuance, transfer or exchange, or otherwise), if any, and delivery of the same to Indenture Trustee (if applicable) (SECTIONS 2.3, 2.5, 2.6, 2.11(c) or 2.14);
(ii) the duty to cause the Note Register to be kept, to appoint a successor Transfer Agent and Registrar, if necessary, and to give Indenture Trustee notice of any appointment of a new Transfer Agent and Registrar and the location, or change in location, of the Note Register (SECTION 2.5);
(iii) the furnishing of Indenture Trustee, Servicer, any Noteholder or the Paying Agent with the names and addresses of Noteholders after receipt of a written request therefor from Indenture Trustee, Servicer, any Noteholder or the Paying Agent, respectively, or as otherwise specified in the Indenture (SECTIONS 2.9(a) and 7.1);
(iv) the preparation, obtaining or filing of the instruments, opinions and certificates and other documents required for the release of collateral (SECTION 8.7);
(v) the duty to cause Issuer to maintain an office or agency within New York (and as otherwise set forth in an Indenture Supplement) and to give Indenture Trustee and the Noteholders notice of the location, or change in location, of such office or agency (SECTION 3.2);
(vi) the duty to direct Indenture Trustee to deposit with any Paying Agent the sums specified in the Indenture and the preparation of an Issuer Order directing the investment of such funds in Permitted Investments (SECTION 3.3);
(vii) the duty to cause newly appointed Paying Agents, if any, to deliver to Indenture Trustee the instrument specified in the Indenture regarding funds held in trust (SECTION 3.3);
(viii) the direction to Paying Agents to pay to Indenture Trustee all sums held in trust by such Paying Agents (SECTION 3.3);
(ix) the duty to cause Issuer to keep in full force its existence, rights and franchises as a Delaware business trust and the obtaining and preservation of Issuer's qualification to do business in each jurisdiction in which such qualification is or shall be necessary to protect the validity and enforceability of the Indenture, the Notes, the Collateral and each other related instrument and agreement (SECTION 3.4);
(x) the preparation of all supplements, amendments, financing statements, continuation statements, if any, instruments of further assurance and other instruments necessary to protect, maintain and enforce the Collateral (SECTION 3.5);
(xi) the obtaining of the Opinion of Counsel on each Closing Date and the annual delivery of Opinions of Counsel as to the Collateral, and the annual delivery of the Officer's Certificate (SECTIONS 3.6 and 3.9);
(xii) the identification to Indenture Trustee in an Officer's Certificate of a Person with whom Issuer has contracted to assist it in performing its duties under the Indenture (SECTION 3.7(b));
(xiii) causing the delivery of notice by Indenture Trustee to the Rating Agencies of the occurrence of any Servicer Default of which Issuer has knowledge and the action, if any, being taken in connection with such default (SECTION 3.7(d));
(xiv) the delivery to Indenture Trustee, within 120 days after the end of each fiscal year of Issuer of an Officer's Certificate with respect to various matters relating to compliance with the Indenture (SECTION 3.9);
(xv) the preparation and obtaining of documents, certificates, opinions and instruments required in connection with the consolidation or merger by Issuer with or into any other Person or the sale of Issuer's assets substantially as an entirety to any Person (SECTION 3.10);
(xvi) the delivery of notice to Indenture Trustee and the Rating Agencies of (1) each Event of Default, (2) each default by Servicer or Transferor under the Transfer and Servicing Agreement (SECTION 3.18) and (3) each default by the RPA Seller under the Receivables Purchase Agreement;
(xvii) the monitoring of Issuer's obligations as to the satisfaction and discharge of the Indenture and the preparation of an Officer's Certificate and the obtaining of the Opinion of Counsel and the Independent Certificate relating thereto (SECTION 4.1);
(xviii) the compliance with any directive of Indenture Trustee with respect to the sale of the Collateral if an Event of Default shall have
occurred and be continuing and the Notes have been accelerated (SECTION 5.5);
(xix) the preparation of an Officer's Certificate to be delivered to Indenture Trustee and the delivery of such Officer's Certificate to the Noteholders (SECTION 6.3(b));
(xx) the removal of Indenture Trustee, if necessary and in compliance with the Indenture, and the appointment of a successor (SECTION 6.8);
(xxi) the preparation of various reports to be filed with Indenture Trustee and the Commission, as applicable (SECTION 7.3);
(xxii) notifying Indenture Trustee if and when the Notes are listed on any stock exchange (SECTION 7.4);
(xxiii) the preparation of an Issuer Order and Officer's Certificate and the obtaining of an Opinion of Counsel and Independent Certificates, if necessary, for the release of the Collateral (SECTIONS 8.7 and 8.8);
(xxiv) the preparation of Issuer Orders, agreements, certificates, instruments, consents and other documents and the obtaining of Opinions of Counsel with respect to the execution of supplemental indentures (SECTIONS 3.7(f), 10.1, 10.2 and 10.3);
(xxv) the execution of new Notes conforming to any supplemental indenture (SECTION 10.6);
(xxvi) the preparation of all Officers' Certificates, Opinions of Counsel and, if necessary, Independent Certificates with respect to any requests by Issuer to Indenture Trustee to take any action under the Indenture (SECTION 12.1(a));
(xxvii) the preparation and delivery of Officers' Certificates and the obtaining of Independent Certificates, if necessary, in connection with the deposit of any Collateral or other property or securities with Indenture Trustee that is to be made the basis for the release of property from the lien of the Indenture (SECTION 12.1(b));
(xxviii) the preparation and delivery to Noteholders and Indenture Trustee of any agreements with respect to alternate payment and notice provisions (SECTION 12.6); and
(xxix) compliance with the provisions of the Transfer and Servicing Agreement, Indenture Supplement and Trust Agreement applicable to Issuer.
(b) ADDITIONAL DUTIES.
(i) In addition to the duties of Administrator set forth above, but subject to SECTIONS 1(c)(ii) and 5, Administrator shall perform all duties and obligations of Issuer under the Related Agreements, and shall perform such calculations and shall prepare for execution by Issuer and shall cause the preparation by other appropriate persons of all such documents, reports, filings, instruments, certificates and opinions as it shall be the duty of Issuer or Owner Trustee to prepare, file or deliver pursuant to the Related Agreements and shall administer the Trust in the interest of the holder of the Transferor Interest, and at the request of Issuer shall take all appropriate action that it is the duty of Issuer or Owner Trustee to take pursuant to the Related Agreements. Subject to SECTIONS 1(c)(ii) and 5 of this Agreement, and in accordance with the directions of Issuer, Administrator shall administer, perform or supervise the performance of such other activities in connection with the Collateral (including the Related Agreements) as are not covered by any of the foregoing provisions and as are expressly requested by Owner Trustee and are reasonably within the capability of Administrator.
(ii) Administrator shall perform any duties expressly required to be performed by Administrator under the Trust Agreement, including the preparation of tax returns pursuant to SECTION 5.7 of the Trust Agreement.
(iii) In carrying out the foregoing duties or any of its other obligations under this Agreement, Administrator may enter into transactions with or otherwise deal with any of its Affiliates; PROVIDED, HOWEVER, that the terms of any such transactions or dealings shall be in accordance with any directions received from Issuer and shall be, in Administrator's opinion, no less favorable to Issuer than would be available from unaffiliated parties.
(iv) It is the intention of the parties hereto that Administrator shall, and Administrator hereby agrees to, prepare, file and deliver on behalf of Issuer all such documents, reports, filings, instruments, certificates and opinions as it shall be the duty of Issuer to prepare, file or deliver pursuant to the Related Agreements, including any filing, reports, notices, applications and registrations with, and seek any consents or authorizations from, the Securities and Exchange Commission and any state authority on behalf of Issuer as may be necessary or advisable to comply with any federal or state securities or reporting requirements laws, to the extent not provided by Servicer in accordance with SECTION 3.1(a) of the Pooling and Servicing Agreement and SECTION 3.10 of the Transfer and Servicing Agreement. In furtherance thereof, Owner Trustee shall, on behalf of Issuer, execute and deliver to Administrator and its agents, and to each successor Administrator appointed pursuant to the terms hereof,
one or more powers of attorney substantially in the form of EXHIBIT A hereto, appointing Administrator the attorney-in-fact of Issuer for the purpose of executing on behalf of Issuer all such documents, reports, filings, instruments, certificates and opinions.
(c) Non-Ministerial Matters.
(i) With respect to matters that in the reasonable judgment of Administrator are nonministerial, Administrator shall not take any action unless within a reasonable time before the taking of such action, Administrator shall have notified Transferor of the proposed action and Transferor shall not have withheld consent or provided an alternative direction. For the purpose of the preceding sentence, "non-ministerial matters" shall include:
(A) the amendment of or any supplement to the Indenture;
(B) the initiation of any claim or lawsuit by Issuer and the compromise of any action, claim or lawsuit brought by or against Issuer (other than in connection with the collection or enforcement of the Collateral);
(C) the amendment, change or modification of the Related Agreements;
(D) the appointment of successor Transfer Agent and Registrars, successor Paying Agents and successor Indenture Trustees pursuant to the Indenture or the appointment of successor Administrators, or the consent to the assignment by the Transfer Agent and Registrar, Paying Agent or Indenture Trustee of its obligations under the Indenture; and
(E) the removal of Indenture Trustee.
(ii) Notwithstanding anything to the contrary in this
Agreement, Administrator shall not be obligated to, and shall not, (x)
make any payments from its own funds to the Noteholders, the Holders of
the Transferor Interest or any other Person under the Related
Agreements, (y) sell the Receivables (or interests therein) pursuant to
SECTION 5.5 of the Indenture other than pursuant to a written directive
of Indenture Trustee or (z) take any other action that Issuer directs
Administrator not to take on its behalf.
2. RECORDS. Administrator shall maintain appropriate books of account and records relating to services performed hereunder, which books of account and records shall be accessible for inspection by Issuer, Owner Trustee,
Indenture Trustee, Servicer and Transferor at any time during normal business hours.
3. COMPENSATION. As compensation for the performance of Administrator's obligations under this Agreement, Administrator shall be entitled to $100 per month which shall be payable in accordance with Section 3.1(e) of the Transfer and Servicing Agreement. Transferor shall be responsible for payment of Administrator's fees (to the extent not paid pursuant to Section 3.1(e) of the Transfer and Servicing Agreement).
4. ADDITIONAL INFORMATION TO BE FURNISHED TO ISSUER. Administrator shall furnish to Issuer from time to time such additional information regarding the Collateral as Issuer shall reasonably request.
5. INDEPENDENCE OF ADMINISTRATOR. For all purposes of this Agreement, Administrator shall be an independent contractor and shall not be subject to the supervision of Issuer or Owner Trustee with respect to the manner in which it accomplishes the performance of its obligations hereunder. Unless expressly authorized by Issuer, Administrator shall have no authority to act for or represent Issuer or Owner Trustee in any way and shall not otherwise be deemed an agent of Issuer or Owner Trustee.
6. NO JOINT VENTURE. Nothing contained in this Agreement shall
(i) constitute Administrator and either of Issuer or Owner Trustee as members of
any partnership, joint venture, association, syndicate, unincorporated business
or other separate entity, (ii) be construed to impose any liability as such on
any of them or (iii) be deemed to confer on any of them any express, implied or
apparent authority to incur any obligation or liability on behalf of the others.
7. OTHER ACTIVITIES OF ADMINISTRATOR. Nothing herein shall prevent Administrator or its Affiliates from engaging in other businesses or, in its sole discretion, from acting in a similar capacity as an administrator for any other person or entity even though such person or entity may engage in business activities similar to those of Issuer, Owner Trustee or Indenture Trustee.
8. TERM OF AGREEMENT; RESIGNATION AND REMOVAL OF ADMINISTRATOR.
(a) This Agreement shall continue in force until the termination of Issuer, upon which event this Agreement shall automatically terminate.
(b) Subject to SECTIONS 8(e) and (f), Administrator may resign its duties hereunder by providing Issuer with at least sixty (60) days prior written notice.
(c) Subject to SECTIONS 8(e) and (f), Issuer may remove Administrator without cause by providing Administrator with at least sixty (60) days prior written notice.
(d) Subject to SECTIONS 8(e) and (f), at the sole option of Issuer, Administrator may be removed immediately upon written notice of termination from Issuer to Administrator if any of the following events shall occur:
(i) Administrator shall default in the performance of any of its duties under this Agreement and, after notice of such default, shall not cure such default within thirty (30) days (or, if such default cannot be cured in such time, shall not give within thirty (30) days such assurance of cure as shall be reasonably satisfactory to Issuer);
(ii) a court having jurisdiction in the premises shall enter a decree or order for relief, and such decree or order shall not have been vacated within sixty (60) days, in respect of Administrator in any involuntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect or appoint a receiver, conservator, liquidator, assignee, custodian, trustee, sequestrator or similar official for Administrator or any substantial part of its property or order the winding up or liquidation of its affairs; or
(iii) Administrator shall commence a voluntary case under any applicable bankruptcy, insolvency or other similar law now or hereafter in effect, shall consent to the entry of an order for relief in an involuntary case under any such law, or shall consent to the appointment of a receiver, liquidator, assignee, trustee, custodian, sequestrator or similar official for Administrator or any substantial part of its property, shall consent to the taking of possession by any such official of any substantial part of its property, shall make any general assignment for the benefit of creditors, shall admit in writing its inability to pay its debts generally as they become due or shall fail generally to pay its debts as they become due.
Administrator agrees that if any event specified in CLAUSE
(ii) or (iii) of this SECTION 8(d) shall occur, it shall give written
notice thereof to Issuer and Indenture Trustee within seven (7) days
after the happening of such event. After obtaining knowledge of any
event specified in CLAUSE (i), (ii) or (iii) of this SECTION 8(d),
Issuer shall give prompt written notice thereof to the Rating Agencies.
(e) No resignation or removal of Administrator pursuant to this
SECTION 8 shall be effective until (i) a successor Administrator shall have been
appointed by Issuer and (ii) such successor Administrator shall have agreed in
writing to be bound by the terms of this Agreement in the same manner as
Administrator is bound hereunder.
(f) The appointment of any successor Administrator shall be effective only after satisfaction of the Rating Agency Condition with respect to the proposed appointment.
9. ACTION UPON TERMINATION, RESIGNATION OR REMOVAL. Promptly upon
the effective date of termination of this Agreement pursuant to SECTION 8(a) or
the resignation or removal of Administrator pursuant to SECTIONS 8(b), (c) or
(d), respectively, Administrator shall be entitled to be paid all fees and
reimbursable expenses accruing to it to the date of such termination,
resignation or removal. Administrator shall forthwith upon such termination
pursuant to SECTION 8(a) deliver to Transferor all property and documents of or
relating to the Collateral then in the custody of Administrator. In the event of
the resignation or removal of Administrator pursuant to SECTIONS 8(b), (c) or
(d), respectively, Administrator shall cooperate with Issuer and take all
reasonable steps requested to assist Issuer in making an orderly transfer of the
duties of Administrator.
10. NOTICES. Any notice, report or other communication given hereunder shall be in writing and addressed as follows:
(a) if to Issuer or Owner Trustee, to the Corporate Trust Office of the Owner Trustee, with a copy to Administrator;
(b) if to Administrator, to World Financial Network National Bank, 800 Techcenter Drive, Gahanna, Ohio 43230, Attention: President;
(c) if to Indenture Trustee, to BNY Midwest Trust Company, 2 North LaSalle Street, Suite 1020, Chicago, IL 60602, Attention: Structural Finance Services;
(d) if to Transferor, to WFN Credit Company, LLC, 220 West Schrock Road, Westerville, Ohio 43801, Attention: President;
or to such other address as any party shall have provided to the other parties in writing. Any notice required to be in writing hereunder shall be deemed given if such notice is mailed by certified mail, postage prepaid, or hand delivered to the address of such party as provided above, except that notices to Indenture Trustee, Transferor, Administrator or Issuer are effective only upon receipt.
11. AMENDMENTS. This Agreement may be amended from time to time, by a written amendment duly executed and delivered by Issuer and Administrator, with the written consent of Owner Trustee (as such and in its individual capacity), without the consent of any of the Noteholders, the Holders of the Transferor Interest or the Transferor to cure any ambiguity, to correct or supplement any provisions in this Agreement or for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or modifying in any manner the rights of the Noteholders or the Holders of the Transferor Interest in a manner not inconsistent with the provisions of this Agreement; PROVIDED, HOWEVER, that such amendment will not, as evidenced by an Officer's Certificate of Administrator addressed and delivered to Owner Trustee, materially and adversely affect the interests of any Noteholder or any beneficial owner of the Trust.
This Agreement may also be amended from time to time, by a written amendment duly executed and delivered by Issuer and Administrator, with the written consent of Owner Trustee (as such and in its individual capacity), the holders of Notes evidencing not less than 66 2/3% of the Outstanding Amount of the Notes and the Transferor, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or modifying in any manner the rights of Noteholders or any beneficial owner of the Trust; PROVIDED, HOWEVER, that, without the consent of the Holders of all of the Notes then Outstanding, no such amendment shall (a) increase or reduce in any manner the amount of, or accelerate or delay the timing of, collections of payments on the Receivables or distributions that are required to be made for the benefit of the Noteholders or (b) reduce the aforesaid portion of the Outstanding Amount of the Notes, the Holders of which are required to consent to any such amendment.
Prior to the execution of any such amendment or consent, Administrator shall furnish written notification of the substance of such amendment or consent to each Rating Agency. Promptly after the execution of any such amendment or consent, Administrator shall furnish written notification of the substance of such amendment or consent to Indenture Trustee.
It shall not be necessary for the consent of Noteholders pursuant to this Section 11 to approve the particular form of any proposed amendment or consent, but it shall be sufficient if such consent shall approve the substance thereof.
12. SUCCESSORS AND ASSIGNS. This Agreement may not be assigned by Administrator unless such assignment is previously consented to in writing by Issuer, Transferor and Owner Trustee (as such and in its individual capacity) and subject to the satisfaction of the Rating Agency Condition in respect thereof. An assignment with such consent and satisfaction, if accepted by the assignee, shall bind the assignee hereunder in the same manner as Administrator is bound hereunder. Notwithstanding the foregoing, this Agreement may be assigned by Administrator without the consent of Issuer, Transferor, Owner Trustee or the Rating Agencies to a corporation or other organization that is a successor (by merger, consolidation or purchase of assets) to Administrator, provided that such successor organization executes and delivers to Issuer, Transferor and Owner Trustee an agreement in which such corporation or other organization agrees to be bound hereunder by the terms of said assignment in the same manner as Administrator is bound hereunder. Subject to the foregoing, this Agreement shall bind any successors or assigns of the parties hereto.
13. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
14. HEADINGS. The section headings hereof have been inserted for convenience of reference only and shall not be construed to affect the meaning, construction or effect of this Agreement.
15. COUNTERPARTS. This Agreement may be executed in counterparts, each of which when so executed shall together constitute but one and the same agreement.
16. SEVERABILITY. Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.
17. NOT APPLICABLE TO WFN IN OTHER CAPACITIES. Nothing in this Agreement shall affect any obligation WFN may have in any other capacity, other than as Administrator.
18. LIMITATION OF LIABILITY OF OWNER TRUSTEE. Notwithstanding anything contained herein to the contrary, this instrument has been signed by Chase Manhattan Bank USA, National Association not in its individual capacity but solely in its capacity as Owner Trustee of Issuer and in no event shall Chase Manhattan Bank USA, National Association in its individual capacity or any beneficial owner of Issuer have any liability for the representations, warranties, covenants, agreements or other obligations of Issuer hereunder, as to all of which recourse shall be had solely to the assets of Issuer. For all purposes of this Agreement, in the performance of any duties or obligations hereunder, Owner Trustee (as such or in its individual capacity) shall be subject to, and entitled to the benefits of, the terms and provisions of the Trust Agreement.
19. THIRD-PARTY BENEFICIARY. Owner Trustee is a third party beneficiary to this Agreement and is entitled to the rights and benefits hereunder and may enforce the provisions hereof as if it were a party hereto.
20. NONPETITION COVENANTS. Notwithstanding any prior termination of this Agreement, neither Owner Trustee nor Administrator shall at any time institute against Issuer, Transferor or Certificate Trust, or solicit or join or cooperate with or encourage any institution against Issuer, Transferor or Certificate Trust of any bankruptcy, reorganization, arrangement, insolvency to liquidating proceedings under any United States federal or state bankruptcy or similar law in connection with any obligations relating to the Notes, this Administration Agreement or any of the other Transaction Documents; PROVIDED, HOWEVER, that this SECTION 20 shall not operate to preclude any remedy described in Article V of the Indenture.
21. SUCCESSOR ADMINISTRATOR. In the event of a servicing transfer pursuant to Article VII of the Transfer and Servicing Agreement, the successor
servicer under the Transfer and Servicing Agreement shall, upon the date of such servicing transfer, become the successor Administrator hereunder.
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed and delivered as of the day and year first above written.
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST
By: Chase Manhattan Bank USA, National Association,
not in its individual capacity
but solely as Owner Trustee
By: /s/ Denis Kelly -------------------------- Name: Denis Kelly Title: Assistant Vice President |
WORLD FINANCIAL NETWORK
NATIONAL BANK, as Administrator
By: /s/ Robert P. Armiak -------------------------- Name: Robert P. Armiak Title: Vice President and Treasurer |
Acknowledged and Accepted:
WFN CREDIT COMPANY, LLC,
as Transferor
By: Robert P. Armiak --------------------------------- Name: Robert P. Armiak Title: Vice President and Treasurer |
Administration Agreement Signature Page
EXHIBIT A
[Form of Power of Attorney]
POWER OF ATTORNEY
STATE OF DELAWARE )
)
COUNTY OF NEWCASTLE )
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KNOW ALL MEN BY THESE PRESENTS, that World Financial Network Credit Card Master Note Trust, a Delaware business trust ("Trust"), does hereby make, constitute and appoint World Financial Network National Bank, as Administrator under the Administration Agreement (as defined below), and its agents and attorneys, as Attorneys-in-Fact to execute on behalf of the Trust all such documents, reports, filings, instruments, certificates and opinions as it shall be the duty of the Trust to prepare, file or deliver pursuant to the Related Agreements (as defined in the Administration Agreement), including to appear for and represent the Trust in connection with the preparation, filing and audit of federal, state and local tax returns pertaining to the Trust, and with full power to perform any and all acts associated with such returns and audits that the Trust could perform, including the right to distribute and receive confidential information, defend and assert positions in response to audits, initiate and defend litigation, and to execute waivers of restriction on assessments of deficiencies, consents to the extension of any statutory or regulatory time limit, and settlements. For the purpose of this Power of Attorney, the term "Administration Agreement" means the Administration Agreement, dated as of August 1, 2001, between the Trust and World Financial Network National Bank, as Administrator, and as such may be amended from time to time.
This power of attorney is coupled with an interest and shall survive and not be affected by the subsequent bankruptcy or dissolution of the Trust.
All powers of attorney for this purpose heretofore filed or executed by the Trust are hereby revoked.
EXECUTED this ____ day of _________, 2001.
WORLD FINANCIAL NETWORK CREDIT CARD
MASTER NOTE TRUST
By: Chase Manhattan Bank USA,
National Association,
not in its individual capacity
but solely as Owner Trustee
By:_________________________________
Name:_______________________________
Title:______________________________
Exhibit 4.6
WFN CREDIT COMPANY, LLC,
Transferor
WORLD FINANCIAL NETWORK NATIONAL BANK,
Servicer
and
BNY MIDWEST TRUST COMPANY,
Trustee
WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST
SECOND AMENDED AND RESTATED POOLING AND SERVICING AGREEMENT
Dated as of January 17, 1996
amended and restated as of September 17, 1999 and hereby amended and restated a second time as of August 1, 2001
TABLE OF CONTENTS
PAGE
ARTICLE I DEFINITIONS..........................................................1
SECTION 1.1. Definitions..........................................1
SECTION 1.2. Other Interpretive Provisions.......................21
ARTICLE II CONVEYANCE OF RECEIVABLES..........................................21
SECTION 2.1. Conveyance of Receivables...........................21
SECTION 2.2. Acceptance by Trustee...............................24
SECTION 2.3. Representations and Warranties of Transferor
Relating to Transferor..............................24
SECTION 2.4. Representations and Warranties of Transferor
Relating to Transaction Documents and the
Receivables.........................................26
SECTION 2.5. Reassignment of Ineligible Receivables..............28
SECTION 2.6. Reassignment of Receivables in Trust Portfolio......29
SECTION 2.7. Covenants of Transferor.............................30
SECTION 2.8. Addition of Accounts................................35
SECTION 2.9. Removal of Accounts.................................40
SECTION 2.10. Discount Option.....................................42
SECTION 2.11. Additional Transferors..............................43
SECTION 2.12. Additional Credit Card Originators..................43
ARTICLE III ADMINISTRATION AND SERVICING......................................43
SECTION 3.1. Acceptance of Appointment and Other Matters
Relating to Servicer................................43
SECTION 3.2. Servicing Compensation..............................44
SECTION 3.3. Representations, Warranties and Covenants of
Servicer............................................45
SECTION 3.4. Reports to Trustee..................................48
SECTION 3.5. Annual Certificate of Servicer......................48
SECTION 3.6. Annual Servicing Report of Independent
Public Accountants; Copies of Reports
Available ..........................................48
SECTION 3.7. Tax Treatment.......................................49
SECTION 3.8. Notices to Transferor...............................50
SECTION 3.9. Adjustments.........................................50
ARTICLE IV RIGHTS OF HOLDERS; ALLOCATIONS.....................................51
SECTION 4.1. Rights of Holders...................................51
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SECTION 4.2 Establishment of Collection Account and
Excess Funding Account..............................51
SECTION 4.3. Collections and Allocations.........................52
SECTION 4.4. Shared Principal Collections........................54
SECTION 4.5. Excess Finance Charge Collections...................54
ARTICLE V DISTRIBUTIONS AND REPORTS...........................................55
ARTICLE VI THE CERTIFICATES...................................................55
SECTION 6.1. The Certificates....................................55
SECTION 6.2. Authentication of Certificates......................55
SECTION 6.3. New Issuances.......................................55
SECTION 6.4. Registration of Transfer and Exchange of
Certificates........................................57
SECTION 6.5. Mutilated, Destroyed, Lost or Stolen
Certificates........................................61
SECTION 6.6. Persons Deemed Owners...............................62
SECTION 6.7. Appointment of Paying Agent.........................62
SECTION 6.8. Access to List of Registered Holders' Names
and Addresses.......................................63
SECTION 6.9. Authenticating Agent................................63
SECTION 6.10. Book-Entry Certificates.............................64
SECTION 6.11. Notices to Clearing Agency..........................65
SECTION 6.12. Definitive Certificates.............................65
SECTION 6.13. Global Certificate..................................66
SECTION 6.14. Uncertificated Classes..............................66
SECTION 6.15. CUSIP Numbers.......................................66
ARTICLE VII OTHER MATTERS RELATING TO TRANSFEROR..............................66
SECTION 7.1. Liability of Transferor.............................66
SECTION 7.2. Merger or Consolidation of, or Assumption of
the Obligations of, Transferor......................66
SECTION 7.3. Limitations on Liability of Transferor..............68
SECTION 7.4. Liabilities.........................................68
ARTICLE VIII OTHER MATTERS RELATING TO SERVICER...............................68
SECTION 8.1. Liability of Servicer...............................68
SECTION 8.2. Merger or Consolidation of, or Assumption of
the Obligations of, Servicer........................68
SECTION 8.3. Limitation on Liability of Servicer and Others......69
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SECTION 8.4. Servicer Indemnification of the Trust and Trustee...70
SECTION 8.5. Servicer Not to Resign..............................70
SECTION 8.6. Access to Certain Documentation and
Information Regarding the Receivables...............71
SECTION 8.7. Delegation of Duties................................71
ARTICLE IX EARLY AMORTIZATION EVENTS..........................................71
SECTION 9.1. Early Amortization Events...........................71
SECTION 9.2. Additional Rights upon Certain Events...............72
ARTICLE X SERVICER DEFAULTS...................................................73
SECTION 10.1. Servicer Defaults...................................73
SECTION 10.2. Trustee to Act; Appointment of Successor............75
SECTION 10.3. Notification to Holders.............................76
SECTION 10.4. Waiver of Past Defaults.............................76
ARTICLE XI TRUSTEE............................................................77
SECTION 11.1. Duties of Trustee...................................77
SECTION 11.2. Certain Matters Affecting Trustee...................78
SECTION 11.3. Trustee Not Liable for Recitals in Certificates.....80
SECTION 11.4. Trustee Not to Own Certificates.....................80
SECTION 11.5. Servicer to Pay Trustee's Fees and Expenses.........80
SECTION 11.6. Eligibility Requirements for Trustee................81
SECTION 11.7. Resignation or Removal of Trustee...................81
SECTION 11.8. Successor Trustee...................................82
SECTION 11.9. Merger or Consolidation of Trustee..................82
SECTION 11.10. Appointment of Co-Trustee or Separate Trustee.......82
SECTION 11.11. Tax Return..........................................84
SECTION 11.12. Trustee May Enforce Claims Without Possession
of Certificates.....................................84
SECTION 11.13. Suits for Enforcement...............................84
SECTION 11.14. Rights of Holders to Direct Trustee.................84
SECTION 11.15. Representations and Warranties of Trustee...........85
SECTION 11.16. Maintenance of Office or Agency.....................85
SECTION 11.17. Confidentiality.....................................85
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ARTICLE XII TERMINATION.......................................................86
SECTION 12.1. Termination of Trust................................86
SECTION 12.2. Final Distribution..................................86
SECTION 12.3. Transferor's Termination Rights.....................88
ARTICLE XIII MISCELLANEOUS PROVISIONS.........................................88
SECTION 13.1. Amendment; Waiver of Past Defaults..................88
SECTION 13.2. Protection of Right, Title and Interest to Trust....90
SECTION 13.3. Limitation on Rights of Holders.....................91
SECTION 13.4. GOVERNING LAW.......................................91
SECTION 13.5. Notices, Payments...................................91
SECTION 13.6. Rule 144A Information...............................92
SECTION 13.7. Severability of Provisions..........................92
SECTION 13.8. Certificates Nonassessable and Fully Paid...........92
SECTION 13.9. Further Assurances..................................93
SECTION 13.10. Nonpetition Covenant................................93
SECTION 13.11. No Waiver; Cumulative Remedies......................93
SECTION 13.12. Counterparts........................................93
SECTION 13.13. Third-Party Beneficiaries...........................93
SECTION 13.14. Actions by Holders..................................94
SECTION 13.15. Merger and Integration..............................94
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EXHIBITS
Exhibit A Form of Assignment of Receivables in
Supplemental Accounts
Exhibit B Form of Reassignment of Receivables in
Removed Accounts
Exhibit C Form of Annual Servicer's Certificate
Exhibit D-1 Private Placement Legend
Exhibit D-2 Form of Undertaking Letter
Exhibit D3 ERISA Legend
Exhibit E-1 Form of Opinion of Counsel with respect
to Amendments
Exhibit E-2 Form of Opinion of Counsel with respect
to Addition of Supplemental Accounts
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SECOND AMENDED AND RESTATED POOLING AND SERVICING AGREEMENT, dated as of August 1, 2001 among WFN CREDIT COMPANY, LLC, a Delaware limited liability company, as Transferor, WORLD FINANCIAL NETWORK NATIONAL BANK, a national banking association ("WFN"), as Servicer, and BNY MIDWEST TRUST COMPANY (successor to the corporate trust administration of Harris Trust and Savings Bank, successor to The Bank of New York), an Illinois trust company, as Trustee.
WHEREAS, World Financial Network National Bank, as transferor and servicer, and the Trustee are parties to that certain Pooling and Servicing Agreement, dated as of January 17, 1996, as amended and restated as of September 17, 1999 (the "EXISTING PSA");
WHEREAS, the parties desire to amend and restate in its entirety the Existing PSA in order to, among other things, provide for the substitution of WFN Credit Company, LLC for World Financial Network National Bank, in its capacity as Transferor under the Existing PSA;
NOW, THEREFORE, in consideration of the mutual agreements contained herein, the Existing PSA is hereby amended and restated in its entirety as follows and each party agrees as follows for the benefit of the other parties, the Holders and any Enhancement Provider to the extent provided herein and in any Supplement:
ARTICLE I DEFINITIONS
SECTION 1.1. DEFINITIONS. When used in this Agreement, the following words and phrases have the following meanings. 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" means each Initial Account, each open end credit card account in the Restatement Date Portfolios existing on August 20, 2001 and identified in the Account Schedule delivered on that date, each Automatic Additional Account and each Supplemental Account, but excludes any Account all the Receivables in which are either reassigned or assigned to Transferor or its designee or Servicer in accordance with this Agreement and any inactive Accounts which in accordance with the Credit Card Guidelines have been removed from the computer records of the Credit Card Originator. The term "Account" includes each account into which an Account is transferred (a "TRANSFERRED ACCOUNT") so long as (a) such transfer is made in accordance with the Credit Card Guidelines and (b) such Transferred Account can be traced or identified, by reference to or by way of the Account Schedule delivered to Trustee pursuant to SECTION 2.1 OR 2.8(d), as an account into which an Account has been transferred. The term "Account" includes an Automatic Additional Account or a Supplemental Account only from and after its Addition Date and includes any Removed Account only prior to its Removal Date.
"ACCOUNT SCHEDULE" means a computer file or microfiche list containing a true and complete list of Accounts, identified by account number and setting forth the Receivable balance as of (a) the Trust Cut Off Date (for the Account Schedule delivered on the Initial Closing Date), (b) the end of the related Monthly Period (for any Account Schedule relating to Automatic Additional Accounts), (c) July 31, 2001 for the Account Schedule relating to the Restatement
Date Portfolios, or (d) the related Addition Cut Off Date (for any Account Schedule delivered in connection with any designation of Supplemental Accounts).
"ACQUIRED PORTFOLIO RECEIVABLE" means any receivable acquired by the Credit Card Originator from an Other Originator in connection with the Credit Card Originator's acquisition of a portfolio of revolving credit card accounts from such Other Originator (prior to the transfer of such receivable to the Transferor pursuant to the Receivables Purchase Agreement).
"ADDITION" means the designation of additional Eligible Accounts to be included as Accounts pursuant to SECTION 2.8(a), (b) or (c) or of Participation Interests to be included as Trust Assets pursuant to SECTION 2.8(b) or (c), as applicable.
"ADDITION CUT OFF DATE" means the date as of which any Supplemental Accounts or Participation Interests are designated for inclusion in the Trust, as specified in the related Assignment. The "Addition Cut Off Date" for accounts existing in the Restatement Date Portfolios on July 31, 2001 is August 21, 2001.
"ADDITION DATE" means (a) as to Supplemental Accounts, the date on which the Receivables in such Supplemental Accounts are conveyed to the Trust pursuant to SECTION 2.8(b) or (c), as applicable, (b) as to Automatic Additional Accounts, the date on which such accounts are created or otherwise become Automatic Additional Accounts, (c) as to accounts existing in the Restatement Date Portfolios on August 20, 2001, August 21, 2001 and (d) as to Participation Interests, the date from and after which such Participation Interests are to be included as Trust Assets pursuant to SECTION 2.8(b) OR (c).
"ADDITIONAL ACCOUNT" means an Automatic Additional Account or a Supplemental Account.
"ADDITIONAL LIMITATION EVENT" means the occurrence of either of the following events on any Determination Date:
1. the average of the default ratio for that Determination Date and the preceding two Determination Dates is greater than 1.25%, where the "default ratio" for any Determination Date equals the percentage equivalent of a fraction (A) the numerator of which is the aggregate of the Default Amounts for all Accounts that became Defaulted Accounts during the related Monthly Period and (B) the denominator of which is the total Receivables as of the end of the sixth preceding Monthly Period; or
2. the average of the payment rate for that Determination Date and the preceding two Determination Dates is less than 10%, where the "payment rate" for any Determination Date equals the percentage equivalent of a fraction (A) the numerator of which is the aggregate Collections received during the related Monthly Period and (B) the denominator of which is equal to the total Receivables held by the Trust at the close of business for the Monthly Period immediately prior to such related Monthly Period.
"ADJUSTED INVESTED AMOUNT" is defined, as to any Series, in the related Supplement.
"AFFILIATE" means, as to any specified Person, any other Person controlling or controlled by or under common control with such specified Person. For this purpose, "control" means 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 "controlling" and "controlled" have correlative meanings.
"AGREEMENT" means this Second Amended and Restated Pooling and Servicing Agreement and, for purposes of any Series, the related Supplement.
"AMORTIZATION PERIOD" means, as to any Series or any Class within a Series, any period specified in the related Supplement during which a share of principal collections is set aside to repay the principal investment in that Series (excluding repayments of a Variable Interest during its revolving period).
"APPLICANTS" is defined in SECTION 6.8.
"APPOINTMENT DATE" is defined in SECTION 9.2(a).
"APPROVED PORTFOLIO" means any Identified Portfolio and any additional portfolio that is designated as an Approved Portfolio pursuant to SECTION 2.8(e).
"ASSIGNMENT" is defined in SECTION 2.8(d)(ii).
"AUTHORIZED NEWSPAPER" means any newspaper or newspapers of general circulation in the Borough of Manhattan, The City of New York printed in the English language (and, with respect to any Series or Class, if and so long as the Investor Certificates of such Series or Class are listed on the Luxembourg Stock Exchange and such exchange shall so require, in Luxembourg, printed in any language satisfying the requirements of such exchange) and customarily published on each business day at such place, whether or not published on Saturdays, Sundays or holidays.
"AUTOMATIC ADDITION SUSPENSION DATE" is defined in SECTION 2.8(a).
"AUTOMATIC ADDITION TERMINATION DATE" is defined in SECTION 2.8(a).
"AUTOMATIC ADDITIONAL ACCOUNT" means each open end credit card account in any Approved Portfolio that is established pursuant to a Credit Card Agreement coming into existence after (a) the Trust Cut Off Date (in the case of an account in the Identified Portfolio) or (b) the Addition Cut Off Date relating to the first Addition Date on which receivables from accounts in the applicable portfolio are transferred to the Trust (in the case of an account in any other Approved Portfolio) and, in either case, prior to the Automatic Addition Termination Date or an Automatic Addition Suspension Date, or subsequent to a Restart Date. In addition, accounts in an Approved Portfolio that were in existence, but were not Eligible Accounts, on (x) the Trust Cut Off Date (in the case of an account in the Identified Portfolio) or (y) the Addition Cut Off Date relating to the first Addition Date on which receivables from accounts in the applicable portfolio are transferred to the Trust (in the case of an account in any other Approved Portfolio) but which, in either case, become Eligible Accounts prior to the Automatic Addition
Termination Date or an Automatic Addition Suspension Date, or subsequent to a Restart Date, shall also be "Automatic Additional Accounts" and shall be deemed, for purposes of the definition of "Eligible Account" and SECTION 2.8(a), to have been created on the first day after the Trust Cut Off Date or applicable Addition Cut Off Date on which they are Eligible Accounts.
"AUTOMATIC ADDITION LIMITATION EVENT" means the occurrence of either of the following events on any Determination Date:
1. the average of the default ratio for that Determination Date and the preceding two Determination Dates is greater than 1%, where the "default ratio" for any Determination Date equals the percentage equivalent of a fraction (A) the numerator of which is the aggregate of the Default Amounts for all Accounts that became Defaulted Accounts during the related Monthly Period and (B) the denominator of which is the total Receivables as of the end of the sixth preceding Monthly Period; or
2. the average of the payment rate for that Determination Date and the preceding two Determination Dates is less than 10%, where the "payment rate" for any Determination Date equals the percentage equivalent of a fraction (A) the numerator of which is the aggregate Collections received during the related Monthly Period and (B) the denominator of which is equal to the total Receivables held by the Trust at the close of business for the Monthly Period immediately prior to such related Monthly Period.
"BASE RATE" is defined, as to any Series, in the related Supplement.
"BEARER CERTIFICATE" is defined in SECTION 6.1.
"BENEFIT PLAN" is defined in SECTION 6.4(c).
"BOOK-ENTRY CERTIFICATES" means beneficial interests in the Investor Certificates, ownership and transfers of which shall be made through book entries by a Clearing Agency as described in SECTION 6.10.
"BUSINESS DAY" means any day other than (a) a Saturday or Sunday, (b) any other day on which national banking associations or state banking institutions in New York, New York, Chicago, Illinois or Columbus, Ohio are authorized or obligated by law, executive order or governmental decree to be closed or (c) for purposes of any particular Series, any other day specified in the related Supplement.
"CERTIFICATE" means an Investor Certificate or a certificate representing a Supplemental Interest.
"CERTIFICATE OWNER" means, with respect to a Book-Entry Certificate, the Person who is the owner of such Book-Entry Certificate, as reflected on the books of the Clearing Agency, or on the books of a Person maintaining an account with such Clearing Agency (directly or as an indirect participant, in accordance with the rules of such Clearing Agency).
"CERTIFICATE REGISTER" is defined in SECTION 6.4.
"CLASS" means any class of Investor Certificates of any Series.
"CLEARING AGENCY" means an organization registered as a "clearing agency" pursuant to Section 17A of the Exchange Act.
"CLEARING AGENCY PARTICIPANT" means a broker, dealer, bank, other financial institution or other Person for whom from time to time a Clearing Agency effects book-entry transfers and pledges of securities deposited with the Clearing Agency.
"CLOSING DATE" means, as to any Series, the date on which that Series is issued.
"COLLECTION ACCOUNT" is defined in SECTION 4.2.
"COLLECTIONS" means all payments (including Recoveries of Principal Receivables or Finance Charge Receivables and Insurance Proceeds, whether or not treated as Recoveries) received by Servicer with respect to the Receivables, including In-Store Payments, in the form of cash, checks (to the extent collected), wire transfers or other form of payment in accordance with the Credit Card Agreement in effect from time to time on any Receivables. If so specified in any Supplement, Collections shall also include any payments received by Servicer with respect to Participation Interests.
"COMMISSION" means the Securities and Exchange Commission.
"CORPORATE TRUST OFFICE" is defined in SECTION 11.16.
"COUPON" is defined in SECTION 6.1.
"CREDIT CARD AGREEMENT" means, as to any Account, the agreements between the Credit Card Originator that owns the Account (including WFN as assignee of an Other Originator) and the related Obligor that govern the Account, as amended or otherwise modified from time to time.
"CREDIT CARD GUIDELINES" means the written policies and procedures of the Credit Card Originator relating to the operation of its consumer revolving lending business, including written policies and procedures for determining the creditworthiness of credit card customers, the extension of credit to credit card customers and the maintenance of credit card accounts and collection of related receivables, as amended or otherwise modified from time to time.
"CREDIT CARD ORIGINATOR" means (i) WFN and/or any transferee of the Accounts from WFN or (ii) any other originator of Accounts which is designated from time to time pursuant to SECTION 2.12 and, directly or indirectly, enters into a receivables purchase agreement with Transferor.
"CREDIT CARD PROCESSING AGREEMENT" means one or more agreements between the Credit Card Originator (including WFN as assignee of an Other Originator) and a Merchant pursuant to which the Credit Card Originator agrees to extend open end credit card accounts to customers of the Merchant and the Merchant agrees to allow purchases to be made at its retail establishments, or in its catalogue sales business, under such accounts.
"DAILY REPORT" is defined in SECTION 3.4(a).
"DATE OF PROCESSING" means, as to any transaction, the Business Day on which the transaction is first recorded on Servicer's computer file of consumer revolving accounts (without regard to the effective date of such recordation).
"DEBTOR RELIEF LAWS" means Title 11 of the United States Code and all other applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement, receivership, insolvency, reorganization, suspension of payments, readjustment of debt, marshalling of assets or similar debtor relief laws of the United States, any state or any foreign country from time to time in effect, affecting the rights of creditors generally.
"DEFAULTED RECEIVABLE" means, as to any date of determination, all Principal Receivables in any Account which are charged off as uncollectible on that date in accordance with the Credit Card Guidelines and Servicer's customary and usual servicing procedures for servicing open end credit card account receivables comparable to the Receivables. A Principal Receivable in any Account shall become a Defaulted Receivable on the day on which such Principal Receivable is recorded as charged off in accordance with the Credit Card Guidelines.
"DEFINITIVE CERTIFICATES" is defined in SECTION 6.10.
"DEFINITIVE EURO-CERTIFICATES" is defined in SECTION 6.13.
"DEPOSITORY AGREEMENT" means, as to any Series or Class, any agreement among Transferor, Trustee and any applicable Clearing Agency.
"DETERMINATION DATE" means, unless otherwise specified in any Supplement with respect to the related Series, the second Business Day preceding each Distribution Date.
"DISCOUNT OPTION RECEIVABLES" means, on any Date of Processing on and
after the date on which Transferor's exercise of its discount option pursuant to
SECTION 2.10 takes effect, the sum of (a) the aggregate Discount Option
Receivables at the end of the prior day (which amount, prior to the date on
which Transferor's exercise of its discount option takes effect and with respect
to Receivables generated prior to such date, shall be zero), plus (b) any New
Discount Option Receivables created on such day, minus (c) any Discount Option
Receivables Collections received on such Date of Processing.
"DISCOUNT OPTION RECEIVABLES COLLECTIONS" means on any Date of Processing on and after the date on which Transferor's exercise of its discount option pursuant to SECTION 2.10 takes effect, the product of (a) a fraction the numerator of which is the amount of the Discount Option Receivables and the denominator of which is the sum of the Principal Receivables plus the amount of Discount Option Receivables in each case (for both numerator and denominator) at the end of the prior Monthly Period and (b) Collections of Principal Receivables, prior to any reduction for Finance Charge Receivables which are Discount Option Receivables, received on such Date of Processing.
"DISCOUNT PERCENTAGE" is defined in SECTION 2.10.
"DISTRIBUTION DATE" means, with respect to any Series, the date specified in the related Supplement.
"DOCUMENT DELIVERY DATE" means the Initial Closing Date in the case of Initial Accounts, the Addition Date in the case of Supplemental Accounts and the Removal Date in the case of Removed Accounts.
"EARLY AMORTIZATION EVENT" means, as to any Series, each event specified in SECTION 9.1 and each additional event, if any, specified in the relevant Supplement as an Early Amortization Event for that Series.
"EFFECTIVE DATE" shall mean August 21, 2001.
"ELIGIBLE ACCOUNT" means an open end credit card account in an Approved Portfolio owned by the Credit Card Originator that, as of the Trust Cut Off Date (in the case of an Initial Account), the date of creation thereof (in the case of an Automatic Additional Account) or the related Addition Cut Off Date (in the case of a Supplemental Account):
(a) is in existence and is serviced by the Credit Card Originator or any Affiliate of the Credit Card Originator;
(b) is payable in United States dollars;
(c) except as provided below, has not been identified as an account (i) the credit cards for which have been reported to the Credit Card Originator or the related Other Originator (if any) as lost or stolen or (ii) the Obligor of which is the subject of a bankruptcy proceeding;
(d) none of the Receivables in which have been, sold, pledged, assigned or otherwise conveyed to any Person (except by an Other Originator to the Credit Card Originator or otherwise pursuant to this Agreement), unless any such pledge or assignment is released on or before the Initial Closing Date or the Addition Date, as applicable;
(e) except as provided below, none of the Receivables in which are Defaulted Receivables or have been identified by the Credit Card Originator or the related Other Originator (if any), or by the relevant Obligor to the Credit Card Originator or the related Other Originator (if any), as having been incurred as a result of fraudulent use of a credit card; and
(f) has an Obligor who has provided as his or her most recent billing address, an address located in the United States or a United States military address, PROVIDED that an account shall not fail to be an "Eligible Account" solely due to the Obligor having provided a billing address not satisfying the foregoing if as of the Trust Cut Off Date (in the case of an Initial Account), the end of the most recently ended Monthly Period (in the case of an Automatic Additional Account) or the related Addition Cut Off Date (in the case of a Supplemental Account) the aggregate Principal Receivables in Accounts the most recent billing address for which does not satisfy the foregoing made up less than 2% (or any higher percentage as to which the Rating Agency Condition has been satisfied) of the aggregate Principal Receivables.
Notwithstanding the foregoing, Eligible Accounts may include accounts, the receivables in which have been written off, or as to which the Credit Card Originator or related Other Originator (if any) believes the related Obligor is bankrupt and certain receivables that have been identified by the Obligor as having been incurred as a result of fraudulent use of credit cards or any credit cards have been reported to the Credit Card Originator or the related Other Originator (if any) as lost or stolen, so long as (1) the balance of all receivables included in such accounts is reflected on the books and records of the Credit Card Originator (and is treated for purposes of this Agreement) as "zero" and (2) charging privileges with respect to all such accounts have been canceled and are not reinstated.
"ELIGIBLE DEPOSIT ACCOUNT" means either (a) a segregated account with an Eligible Institution or (b) a segregated trust account with the corporate trust department of a depository institution organized under the laws of the United States or any one of the states thereof, including the District of Columbia (or any domestic branch of a foreign bank), and acting as a trustee for funds deposited in such account, so long as any of the securities of such depository institution shall have a credit rating from each of Moody's, S&P and, if rated by Fitch, Fitch in one of its generic credit rating categories that signifies investment grade.
"ELIGIBLE INSTITUTION" means (a) a depository institution (which may be
Trustee or an affiliate) organized under the laws of the United States or any
one of the states thereof (i) that has either (A) a long-term unsecured debt
rating of "A2" or better by Moody's or (B) a certificate of deposit rating of
"P-1" by Moody's, (ii) that has either (A) a long-term unsecured debt rating of
"AAA" by S&P or (B) a certificate of deposit rating of at least "A-1+" by S&P,
(iii) that, if rated by Fitch, has either (A) a long-term unsecured debt rating
of "AAA" by Fitch or (B) a certificate of deposit rating of at least "F-1+" by
Fitch and (iv) the deposits of which are insured by the FDIC or (b) any other
institution that is acceptable to each Rating Agency, Servicer and Trustee.
"ELIGIBLE INVESTMENTS" means book-entry securities, negotiable instruments or securities represented by instruments in bearer or registered form which evidence:
(a) direct obligations of, and obligations fully guaranteed as to timely payment of principal and interest by, the United States of America;
(b) demand deposits, time deposits or certificates of deposit (having original maturities of no more than 365 days) of depository institutions or trust companies incorporated under the laws of the United States of America or any state thereof (or domestic branches of foreign banks) and subject to supervision and examination by federal or state banking or depository institution authorities; PROVIDED that at the time of the Trust's investment or contractual commitment to invest therein, the short-term debt rating of such depository institution or trust company shall be in the highest investment category of each of Moody's and S&P, which in the case of S&P means A-1+, and, if rated by Fitch, Fitch in its highest investment category;
(c) commercial paper or other short-term obligations having, at the time of the Trust's investment or contractual commitment to invest therein, a rating from each of Moody's and S&P in its highest investment category, which in the case of S&P means A-1+, and, if rated by Fitch, Fitch in its highest investment category;
(d) demand deposits, time deposits and certificates of deposit which are fully insured by the FDIC, with a Person the commercial paper of which has a credit rating from each of Moody's and S&P in its highest investment category, which in the case of S&P means A-1+, and, if rated by Fitch, Fitch in its highest investment category;
(e) notes or bankers acceptances (having original maturities of no more than 365 days) issued by any depository institution or trust company referred to in CLAUSE (b);
(f) investments in money market funds (including funds of Trustee or its affiliates as well as funds for which Trustee and its affiliates may receive compensation) rated in the highest investment category by each of Moody's and S&P, which in the case of S&P means A-1+, and, if rated by Fitch, Fitch in its highest investment category, or otherwise approved in writing by each Rating Agency;
(g) time deposits, other than as referred to in CLAUSE (d), with a Person the commercial paper of which has a credit rating in its highest investment category, from each of Moody's and S&P, which in the case of S&P means A-1+, and, if rated by Fitch, Fitch in its highest investment category; or
(h) any other investments approved in writing by each Rating Agency, PROVIDED that making such investments shall not cause the Trust to be required to register as an investment company within the meaning of the Investment Company Act.
"ELIGIBLE RECEIVABLE" means a Receivable:
(a) that has arisen under an Eligible Account;
(b) that was created in compliance with the Credit Card Guidelines and all Requirements of Law applicable to the Credit Card Originator (or, in the case of an Acquired Portfolio Receivable, the related Other Originator) the failure to comply with which would have a material adverse effect on Investor Holders, and pursuant to a Credit Card Agreement that complies with all Requirements of Law applicable to the Credit Card Originator (and, in the case of an Acquired Portfolio Receivable, the related Other Originator during the time prior to the transfer of such Acquired Portfolio Receivable to the Credit Card Originator), the failure to comply with which would have a material adverse effect on Investor Holders;
(c) with respect to which all consents, licenses, approvals or authorizations of, or registrations with, any Governmental Authority required to be obtained or made by the Credit Card Originator (and, in the case of an Acquired Portfolio Receivable, the related Other Originator with respect to such actions prior to the transfer of such Acquired Portfolio Receivable to the Credit Card Originator) in connection with the creation of such Receivable or the execution, delivery and performance by the Credit Card Originator (and, in the case of an Acquired Portfolio Receivable, the related Other Originator with respect to such actions prior to the transfer of such Acquired Portfolio Receivable to the Credit Card Originator) of the related Credit Card Agreement, have been duly obtained or made and are in full force and effect as of the date of creation of such Receivable, but failure to comply with this CLAUSE (c) shall not cause a Receivable not to be an Eligible Receivable if, and to the extent that, the failure to so obtain or
make any such consent, license, approval, authorization or registration would not have a material adverse effect on the Investor Holders;
(d) as to which, at the time of its transfer to the Trust, Transferor or the Trust will have good and marketable title free and clear of all Liens (other than any Lien permitted by SECTION 2.7(b));
(e) that is the subject of a valid transfer and assignment (or the grant of a security interest) from Transferor to the Trust of all Transferor's right, title and interest therein;
(f) that at and after the time of transfer to the Trust is the legal, valid and binding payment obligation of the Obligor thereof, legally enforceable against such Obligor in accordance with its terms, except as enforceability may be limited by applicable Debtor Relief Laws, and by general principles of equity (whether considered in a suit at law or in equity);
(g) that constitutes an account;
(h) as to which, at the time of its transfer to the Trust, Transferor has not taken any action which, or failed to take any action the omission of which, would, at the time of transfer to the Trust, impair the rights therein of the Trust or the Holders;
(i) that, at the time of its transfer to the Trust, has not been waived or modified except as permitted in accordance with SECTION 3.3(h);
(j) that, at the time of its transfer to the Trust, is not subject to any right of rescission, setoff, counterclaim or any other defense of the Obligor (including the defense of usury), other than defenses arising out of Debtor Relief Laws and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or equity) or as to which Servicer makes an adjustment pursuant to SECTION 3.9; and
(k) as to which, at the time of its transfer to the Trust, the Transferor has satisfied all obligations to be fulfilled at the time it is transferred to the Trust.
"ELIGIBLE SERVICER" means Trustee, a wholly owned subsidiary of Trustee or an entity that, at the time of its appointment as Servicer: (a) is servicing a portfolio of consumer open end credit card accounts or other consumer open end credit accounts; (b) is legally qualified and has the capacity to service the Accounts; (c) is qualified (or licensed) to use the software that is then being used to service the Accounts or obtains the right to use, or has its own, software which is adequate to perform its duties under this Agreement; (d) has, in the reasonable judgment of Trustee, the ability to professionally and competently service a portfolio of similar accounts; and (e) has a net worth of at least $50,000,000 as of the end of its most recent fiscal quarter.
"ENHANCEMENT" means the rights and benefits provided to the Investor Holders of any Series or Class pursuant to any letter of credit, surety bond, cash collateral account, guaranty collateral invested amount, spread account, guaranteed rate agreement, maturity guaranty facility, tax protection agreement, interest rate swap agreement, interest rate cap agreement or other similar arrangement. The subordination of any Class to another Class, or a cross support
feature which requires collections on Receivables allocated to one Series to be paid as principal and/or interest with respect to another Series shall be deemed to be an Enhancement for the Class or Series benefiting from the subordination or cross support feature.
"ENHANCEMENT AGREEMENT" means any agreement, instrument or document governing any Enhancement or pursuant to which any Enhancement is issued or outstanding.
"ENHANCEMENT PROVIDER" means the Person or Persons providing any Enhancement, other than the Investor Holders of any Class which is subordinated to another Class.
"ERISA" means the Employee Retirement Income Security Act of 1974.
"EXCESS FINANCE CHARGE COLLECTIONS" means all amounts that any Supplement designates as "Excess Finance Charge Collections."
"EXCESS FUNDING ACCOUNT" is defined in SECTION 4.2.
"EXCHANGE ACT" means the Securities Exchange Act of 1934.
"EXISTING PSA" is defined in the recitals hereto.
"FDIC" means the Federal Deposit Insurance Corporation.
"FINANCE CHARGE RECEIVABLES" means, with respect to any Monthly Period, the sum of (a) all amounts billed to the Obligors on any Account at the beginning of such Monthly Period in respect of Periodic Finance Charges, (b) Late Fees, return check fees and any other fees that may after the Trust Cut Off Date be charged with respect to any Account, to the extent that Servicer designates such fees to be treated as Finance Charge Receivables in an Officer's Certificate delivered to Trustee and (c) Discount Option Receivables. Except as otherwise specified in any Supplement as to the related Series, Recoveries shall be treated as Collections of Finance Charge Receivables .
"FINANCE CHARGE SHORTFALLS" is defined, as to any Series, in the related Supplement.
"FITCH" means Fitch, Inc.
"GLOBAL CERTIFICATE" is defined in SECTION 6.13.
"GOVERNMENTAL AUTHORITY" means 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" means, with respect to any Series, the group of Series, if any, in which the related Supplement specifies such Series is to be included.
"HOLDER" means an Investor Holder or a Person in whose name the Transferor Interest is registered.
"HOLDING" means Alliance Data Systems Corporation, a Delaware corporation.
"IDENTIFIED PORTFOLIO" means any Accounts owned from time to time by WFN and included in the private label credit card programs of Lane Bryant, Inc., Lerner New York, Inc., Express, Inc., Structure, Inc., Victoria's Secret Stores, Inc., Victoria's Secret Catalogue, Inc., The Limited, Abercrombie & Fitch, Inc., Henri Bendel, Inc. and Brylane, L.P. (but limited, in the case of Brylane, L.P., to accounts related to the Lane Bryant, Lerner New York and Roamans catalogues). To avoid doubt, the foregoing programs include all cards issued under the insignia of "Limited Fashion Group."
"INELIGIBLE RECEIVABLES" is defined in SECTION 2.5(a).
"INITIAL ACCOUNT" means each open end credit card account in the Identified Portfolio existing on the Trust Cut Off Date and identified in the Account Schedule delivered on the Initial Closing Date.
"INITIAL CLOSING DATE" means January 17, 1996.
"INSOLVENCY EVENT" means, (a) with respect to the Transferor, that the Transferor shall consent 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 the Transferor or relating to all or substantially all of the Transferor's property, or the commencement of an action seeking 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 entity's affairs, or notwithstanding an objection by the Transferor any such action shall have remained undischarged or unstayed for a period of sixty (60) days or upon entry of any order or decree providing for such relief; or such Person shall admit in writing its inability to pay its debts generally as they become due, file, or consent or fail to object (or object without dismissal of any such filing within sixty (60) days of such filing) to the filing of, 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 and (b) with respect to WFN, WFN shall consent to the appointment of a conservator or receiver or liquidator in any insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings of or relating to all or substantially all of its property, or a decree or order of a court or agency or supervisory authority having jurisdiction in the premises for the appointment of a conservator or receiver or liquidator in any insolvency, readjustment of debt, marshalling of assets and liabilities or similar proceedings, or for the winding-up or liquidation of its affairs, shall have been entered against WFN; or WFN shall admit in writing its inability to pay its debts generally as they become due, file a petition to take advantage of any applicable insolvency or reorganization statute, make an assignment for the benefit of its creditors or voluntarily suspend payment of its obligations.
"INSOLVENCY PROCEEDS" is defined in SECTION 9.2(b).
"INSURANCE PROCEEDS" means any amounts recovered by Servicer pursuant to any credit insurance policies covering any Obligor with respect to Receivables under such Obligor's Account.
"INTERNAL REVENUE CODE" means the Internal Revenue Code of 1986.
"INVESTED AMOUNT" is defined, as to any Series, in the related Supplement.
"INVESTMENT COMPANY ACT" means the Investment Company Act of 1940.
"INVESTOR CERTIFICATE" means any one of the certificates (including the Bearer Certificates, the Registered Certificates or any Global Certificate) executed by Transferor and authenticated by or on behalf of Trustee, substantially in the form attached to the related Supplement, other than any Certificates representing the Supplemental Interests, if any.
"INVESTOR HOLDER" means the Person in whose name a Registered Certificate is registered in the Certificate Register or the holder of any Bearer Certificate (or the Global Certificate, as the case may be) or Coupon.
"INVESTOR INTEREST" is defined in SECTION 4.1.
"INVESTOR PERCENTAGE" is defined, as to any Series, in the related Supplement.
"INVESTOR SERVICING FEE" is defined, as to any Series, in the related Supplement.
"INVOLUNTARY REMOVAL" is defined in SECTION 2.9(a).
"IN-STORE PAYMENTS" is defined in SECTION 2.1.
"LATE FEES" means the fees specified in the Credit Card Agreement applicable to each Account for late fees with respect to such Account.
"LIEN" means any mortgage, deed of trust, pledge, hypothecation, assignment, participation or equity interest, deposit arrangement, encumbrance, lien (statutory or other), preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever, including any conditional sale or other title retention agreement, excluding any lien or filing pursuant to this Agreement; PROVIDED that any assignment or transfer pursuant to SECTION 6.3(c) or (d) or SECTION 7.2 shall not constitute a Lien.
"MAJORITY HOLDERS" means the Holders of Investor Certificates evidencing more than 50% of the aggregate unpaid principal amount of all outstanding Investor Certificates.
"MERCHANT" means each of (a) Bath & Body Works, Inc., Brylane, L.P., Cacique, Inc., Lane Bryant, Inc., Lerner New York, Inc., Express, Inc., Structure, Inc., Victoria's Secret Stores, Inc., Victoria's Secret Catalogue, Inc., The Limited Stores, Inc., Limited Too, Inc., Abercrombie & Fitch, Inc., and Henri Bendel, Inc. and (b) any other Person that operates retail establishments at which, or a catalogue sales business in which, goods or services may be purchased under an Account.
"MERCHANT ADJUSTMENT PAYMENTS" is defined in SECTION 3.9(a).
"MINIMUM TRANSFEROR AMOUNT" means, as of any date of determination, the sum of (a) the product of (i) the sum of (A) the aggregate Principal Receivables and (B) the amounts on deposit in the Excess Funding Account and (ii) the Required Retained Transferor Percentage plus (b) any additional amounts specified in the Supplement for any outstanding Series.
"MONTHLY PERIOD" means as to each Distribution Date, the immediately preceding calendar month, unless otherwise defined in any Supplement.
"MOODY'S" means Moody's Investors Service, Inc.
"NEW DISCOUNT OPTION RECEIVABLES" means, as of any date of determination, the product of the Discount Percentage and the amount of Principal Receivables (before subtracting Finance Charge Receivables which are Discount Option Receivables) arising on such date of determination.
"NOTICE DATE" is defined in SECTION 2.8(d)(i).
"NOTICES" is defined in SECTION 13.5(a).
"OBLIGOR" means, as to any Account, the Person or Persons obligated to make payments on such Account, including any guarantor.
"OFFICER'S CERTIFICATE" means a certificate delivered to Trustee signed by the Chairman of the Board, President, any Vice President or the Treasurer or any Assistant Treasurer of Transferor or Servicer, as the case may be.
"OPINION OF COUNSEL" means a written opinion of counsel, who may be counsel for, or an employee of, the Person providing the opinion.
"OTHER ORIGINATOR" means any Person from which the Credit Card Originator acquires a portfolio of credit card accounts any or all of which are subsequently designated as Additional Accounts.
"PARTICIPATION INTERESTS" is defined in SECTION 2.8(b).
"PAYING AGENT" means any paying agent and co-paying agent appointed pursuant to SECTION 6.7.
"PERFECTION REPRESENTATIONS AND WARRANTIES" means the representations and warranties set forth below:
1. GENERAL. This Agreement creates a valid and continuing security interest (as defined in the applicable UCC) in the Receivables and the proceeds thereof in favor of the Trust, which (a) in the case of existing Receivables and the proceeds thereof, is enforceable upon execution of this Agreement against creditors of and purchasers from Transferor, or with respect to then existing Receivables in Additional Accounts, as of the applicable Addition Date, and which will
be enforceable with respect to Receivables hereafter and thereafter created and the proceeds thereof upon such creation, in each case as such enforceability may be limited by applicable Debtor Relief Laws, now or hereafter in effect, and by general principles of equity (whether considered in a suit at law or in equity) and (b) upon filing of the financing statements described in CLAUSE 4 below and, in the case of Receivables hereafter created, upon the creation thereof, will be prior to all other Liens (other than Liens permitted pursuant to CLAUSE 3 below).
2. GENERAL. The Receivables constitute "accounts" within the meaning of UCC Section 9-102.
3. CREATION. Immediately prior to the conveyance of the Receivables pursuant to this Agreement, Transferor owns and has good and marketable title to the Receivables free and clear of any Lien, claim or encumbrance of any Person; PROVIDED that nothing in this CLAUSE 3 shall prevent or be deemed to prohibit Transferor from suffering to exist upon any of the Receivables any Liens for any taxes if such taxes shall not at the time be due and payable or if Transferor or RPA Seller, as applicable, shall currently be contesting the validity thereof in good faith by appropriate proceedings and shall have set aside on its books adequate reserves with respect thereto.
4. PERFECTION. Transferor has caused or will have caused, within ten days of the Effective Date, 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 granted by the Transferor to the Trust under this Agreement in the Receivables arising in the Initial Accounts and Automatic Additional Accounts included in the Identified Portfolio, and (if any additional filing is so necessary) within 10 days of the applicable Addition Date, in the case of such Receivables arising in Supplemental Accounts and related Automatic Additional Accounts.
5. PRIORITY. Other than the security interest granted to the Trust pursuant to this Agreement, Transferor has not pledged, assigned, sold, granted a security interest in, or otherwise conveyed any of the Receivables. Transferor has not authorized the filing of and is not aware of any financing statements against Transferor that include a description of collateral covering the Receivables other than any financing statement (i) relating to the security interest granted to Trust hereunder or (ii) that has been terminated.
"PERIODIC FINANCE CHARGES" means any finance charges (due to periodic rate) applicable to any Account.
"PERSON" means any legal person, including any individual, corporation, partnership, limited liability company, joint venture, association, joint-stock company, trust, unincorporated organization, governmental entity or other entity of similar nature.
"PORTFOLIO YIELD" is defined, as to any Series, in the related Supplement.
"PRINCIPAL RECEIVABLE" means all Receivables other than Finance Charge Receivables. In calculating the aggregate amount of Principal Receivables on any day, the amount of Principal Receivables shall not include Defaulted Receivables and shall be reduced by the aggregate amount of credit balances in the Accounts on such day.
"PRINCIPAL SHARING SERIES" means a Series that, pursuant to the Supplement therefor, is entitled to receive Shared Principal Collections.
"PRINCIPAL SHORTFALLS" is defined, as to any Series, in the related Supplement.
"PRINCIPAL TERMS" means, with respect to any Series: (a) its name or
designation; (b) its initial principal amount (or method for calculating such
amount) and its invested amount in the Trust; (c) its interest rate (or method
for the determination thereof); (d) the payment date or dates and the date or
dates from which interest shall accrue; (e) the method for allocating
Collections to Holders of such Series; (f) the designation of any Series
Accounts and the terms governing the operation of any such Series Accounts; (g)
the percentage used to calculate the servicing fee with respect thereto; (h) the
provider, if any, and the terms of any form of Enhancement with respect thereto;
(i) the terms on which the Investor Certificates of such Series may be
repurchased by Transferor or any Affiliate of Transferor or remarketed to other
investors; (j) the Series Termination Date; (k) the number of Classes of
Investor Certificates of such Series and, if such Series consists of more than
one Class, the rights and priorities of each such Class; (l) 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 conditions, if any, upon which such Global
Certificates may be exchanged, in whole or in part, for Definitive Certificates,
and the manner in which any interest payable on a Global Certificate will be
paid); (m) whether the Investor Certificates of such Series may be issued as
Bearer Certificates and any limitation imposed thereon; (n) the priority of such
Series with respect to any other Series; (o) the Group, if any, to which such
Series belongs; (p) whether or not such Series is acting as a paired Series with
another existing Series; and (q) any other terms of such Series.
"RATING AGENCY" means, as to each Series, the rating agency or agencies, if any, specified in the related Supplement.
"RATING AGENCY CONDITION" means, with respect to any action, that each Rating Agency, if any, shall have notified Transferor, Servicer and Trustee in writing that such action will not result in a reduction or withdrawal of the rating, if any, of any outstanding Series or Class with respect to which it is a Rating Agency.
"REASSIGNMENT" is defined in SECTION 2.9.
"RECEIVABLE" means any amount owing from time to time by an Obligor under an Account, including amounts owing for purchases of goods and services, and amounts payable as Finance Charge Receivables. A Receivable shall be deemed to have been created at the end of the day on the Date of Processing of such Receivable. Receivables which become Defaulted Receivables shall not be shown on Servicer's records as amounts payable (and shall cease to be included as Receivables) on the day on which they become Defaulted Receivables.
"RECEIVABLES PURCHASE AGREEMENT" means the Receivables Purchase Agreement, dated as of August 1, 2001, between RPA Seller and Transferor.
"RECORD DATE" means, as to any Distribution Date, the date specified in the related Supplement.
"RECOVERIES" means (a) all amounts received by Servicer with respect to Principal Receivables that have previously become Defaulted Receivables and with respect to Finance Charge Receivables that have been charged off as uncollectible (including Insurance Proceeds) and (b) proceeds of any collateral securing any Receivable, in each case less related collection expenses.
"REGISTERED CERTIFICATES" is defined in SECTION 6.1.
"REGISTERED HOLDER" means the Holder of a Registered Certificate.
"REMOVAL DATE" is defined in SECTION 2.9(a).
"REMOVAL NOTICE DATE" is defined in SECTION 2.9(a).
"REMOVED ACCOUNTS" is defined in SECTION 2.9.
"REQUIRED PRINCIPAL BALANCE" means, as of any date of determination, the sum of the numerators used at such date to calculate the Investor Percentage with respect to Principal Receivables for all Series outstanding on such date, less the amount on deposit in the Excess Funding Account as of the date of determination.
"REQUIRED RETAINED TRANSFEROR PERCENTAGE" means, as of any date of determination, 4% or, if less, the highest of the Required Retained Transferor Percentages specified in the Supplements for all outstanding Series.
"REQUIREMENTS OF LAW" means, as to any Person, the certificate of incorporation or articles of association and by-laws or other organizational or governing documents of such Person, and any law, treaty, rule or regulation, or determination of an arbitrator or Governmental Authority, in each case applicable to or binding upon such Person or to which such Person is subject, whether Federal, state or local.
"RESPONSIBLE OFFICER" means any officer within the Corporate Trust Office, including any vice president, assistant vice president, assistant secretary or any other officer of Trustee customarily performing functions similar to those performed by any of the above-designated officers and having direct responsibility for the administration of this Pooling and Servicing Agreement and also, with respect to a particular matter, any other officer to whom any corporate trust matter is referred at Trustee's Corporate Trust Office because of such officer's knowledge of and familiarity with the particular subject.
"RESTART DATE" is defined in SECTION 2.8(a).
"RESTATEMENT DATE PORTFOLIOS" means any Accounts owned from time to time
by WFN and included in the private label credit card programs of Authority
International, Inc., The Sports Authority, Inc., The Sports Authority Florida,
Inc., The Sports Authority Michigan, Inc., GOODY'S FAMILY CLOTHING, INC., GARDEN
RIDGE, L.P., Too, Inc. (formerly known as Limited Too, Inc.), PACIFIC SUNWEAR
STORES CORP. and PACIFIC SUNWEAR.COM CORP.
"RPA SELLER" means WFN, in its capacity as RPA Seller under the Receivables Purchase Agreement.
"RULE 144A" means Rule 144A under the Securities Act, as such Rule may be amended from time to time.
"S&P" means Standard & Poor's Ratings Service, a division of the McGraw Hill Companies, Inc.
"SECURITIES ACT" means the Securities Act of 1933.
"SERIES" means any series of Investor Certificates established pursuant to a Supplement.
"SERIES ACCOUNT" means any deposit, trust, escrow or similar account maintained for the benefit of the Investor Holders of any Series or Class, as specified in any Supplement.
"SERIES SERVICING FEE PERCENTAGE" is defined, as to any Series, in the related Supplement.
"SERIES TERMINATION DATE" is defined, as to any Series, in the related Supplement.
"SERVICE TRANSFER" is defined in SECTION 10.1.
"SERVICER" means WFN, in its capacity as Servicer pursuant to this Agreement, and, after any Service Transfer, the Successor Servicer.
"SERVICER DEFAULT" is defined in SECTION 10.1.
"SERVICING FEE" means, as to any Series, the servicing fee specified in
SECTION 3.2.
"SERVICING OFFICER" means any officer of Servicer involved in, or responsible for, the administration and servicing of the Receivables whose name appears on a list of servicing officers furnished to Trustee by Servicer on the Initial Closing Date, as such list may from time to time be amended in writing.
"SHARED PRINCIPAL COLLECTIONS" means all amounts that any Supplement designates as "Shared Principal Collections."
"SPECIFIED TRANSFEROR AMOUNT" means, as of any date of determination, 0 or, if more, the highest amount identified as the "Specified Transferor Amount" in the Supplement for any outstanding Series.
"SUBJECT CERTIFICATE" is defined in SECTION 6.4(d).
"SUCCESSOR SERVICER" is defined in SECTION 10.2(a).
"SUPPLEMENT" means, as 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 6.3, and all amendments thereof and supplements thereto.
"SUPPLEMENTAL ACCOUNT" is defined in SECTION 2.8(b).
"SUPPLEMENTAL INTEREST" is defined in SECTION 6.3(c).
"TAX OPINION" means, with respect to any action, an Opinion of Counsel to the effect that, for Federal income tax purposes, (a) such action will not adversely affect the tax characterization as debt of Investor Certificates of any outstanding Series or Class with respect to which an Opinion of Counsel was delivered at the time of their issuance that such Investor Certificates would be characterized as debt, (b) such actions will not cause the Trust to be classified, for federal income tax purposes, as an association (or publicly traded partnership) taxable as a corporation and (c) such action will not cause or constitute an event in which gain or loss would be recognized by any Investor Holder.
"TERMINATION NOTICE" is defined in SECTION 10.1.
"THE LIMITED" means The Limited, Inc., a Delaware corporation.
"TRANSACTION DOCUMENTS" means, at any time, this Agreement, the Receivables Purchase Agreement, the Supplement for each outstanding Series, any document pursuant to which any outstanding purchased interest is sold as permitted by SECTION 6.3(b) and any other document designated as a Transaction Document in any Supplement or any document pursuant to which any outstanding purchased interest is sold as permitted by SECTION 6.3(b).
"TRANSFER AGENT AND REGISTRAR" is defined in SECTION 6.4.
"TRANSFER DATE" means the Business Day immediately preceding each Distribution Date.
"TRANSFEROR" means WFN Credit Company, LLC, a Delaware limited liability
company, and additional transferors, if any, designated in accordance with
SECTION 2.11 or 6.3(d).
"TRANSFEROR AMOUNT" means, on any date of determination, the result of (a) the aggregate amount of Principal Receivables on such day, plus the principal amount on deposit in the Excess Funding Account on such day, minus (b) the sum of the Invested Amounts (or, as to any Series that has an Adjusted Invested Amount, the Adjusted Invested Amount) with respect to all Series (but not of any Supplemental Interests) then outstanding (and of any purchased interest sold pursuant to SECTION 6.3(b)), plus (c) the principal amount on deposit in the Principal Accounts (as defined in the various Supplements) for each Series, to the extent not deducted in calculating an Adjusted Invested Amount for the related Series.
"TRANSFEROR INTEREST" is defined in SECTION 4.1.
"TRANSFEROR PERCENTAGE" means as to Finance Charge Receivables, Defaulted Receivables and Principal Receivables, 100% less the sum of the applicable Investor Percentages for all outstanding Series.
"TRANSFEROR RETAINED CERTIFICATE" means any Certificate in any Class of Investor Certificates that is designated as a "Transferor Retained Class" in any Supplement.
"TRANSFERRED ACCOUNT" is defined in the definition of "Account."
"TRUST" means the Trust created by this Agreement, which shall be known as the World Financial Network Credit Card Master Trust.
"TRUST ASSETS" is defined in SECTION 2.1.
"TRUST CUT OFF DATE" means January 12, 1996.
"TRUSTEE" means BNY Midwest Trust Company (successor to the corporate trust administration of Harris Trust and Savings Bank, successor to The Bank of New York), an Illinois banking corporation, in its capacity as trustee of the Trust, or any successor trustee appointed as herein provided.
"UCC" means the Uniform Commercial Code, as in effect in the State of Ohio and in any other State where the filing of a financing statement is required to perfect Transferor's or the Trust's interest in the Receivables and the proceeds thereof or in any other specified jurisdiction.
"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.
"VARIABLE INTEREST" means either of (a) any Investor Certificate that is designated as a variable funding certificate in the related Supplement and (b) any purchased interest sold as permitted by SECTION 6.3(b).
"WELSH, CARSON, ANDERSON & STOE PARTNERSHIPS" means each Welsh, Carson, Anderson & Stowe limited partnership, as now constituted or as the same may be constituted in the future and any partner, partnership or affiliate of any of them.
"WFN" is defined in the PREAMBLE.
SECTION 1.2. OTHER INTERPRETIVE PROVISIONS. With respect to any Series, all terms used and not defined herein are used as defined in the related Supplement. All terms defined in this Agreement shall have the defined meanings when used in any certificate or other document delivered pursuant hereto unless otherwise defined therein. For purposes of this Agreement and all such certificates and other documents, unless the context otherwise requires: (a) accounting terms not otherwise defined in this Agreement, and accounting terms partly defined in this Agreement to the extent not defined, shall have the respective meanings given to them under generally accepted accounting principles; (b) terms defined in Article 9 of the UCC and not otherwise defined in this Agreement are used as defined in that Article; (c) any reference to each Rating Agency shall only apply to any specific rating agency if such rating agency is then rating any outstanding Series; (d) references to any amount as on deposit or outstanding on any particular date means such amount at the close of business on such day; (e) the words "hereof," "herein" and "hereunder" and words of similar import refer to this Agreement (or the certificate or other document in which they are used) as a whole and not to any particular provision of this Agreement (or such certificate or document); (f) references to any Section, Schedule or Exhibit are references to Sections, Schedules and Exhibits in or to this Agreement (or the certificate or
other document in which the reference is made), and references to any paragraph, subsection, clause or other subdivision within any Section or definition refer to such paragraph, subsection, clause or other subdivision of such Section or definition; (g) the term "including" means "including without limitation"; (h) references to any law or regulation refer to that law or regulation as amended from time to time and include any successor law or regulation; (i) references to any agreement refer to that agreement as amended from time to time; (j) references to any Person include that Person's permitted successors and assigns; and (k) headings are for purposes of reference only and shall not otherwise affect the meaning or interpretation of any provision hereof. The agreements, representations and warranties of WFN in this Agreement, in its respective capacities as Transferor and Servicer, shall be deemed to be the separate agreements, representations and warranties of WFN only so long as it remains a party to this Agreement in such capacity (but the foregoing shall not impair rights arising during or with respect to the time that such Person was a party to this Agreement in such capacity).
ARTICLE II CONVEYANCE OF RECEIVABLES
SECTION 2.1. CONVEYANCE OF RECEIVABLES. (a) By execution of this
Agreement, Transferor transfers, assigns, sets over and otherwise conveys to the
Trustee, for the benefit of the Investor Holders, all of its right, title and
interest in, to and under (i) the Receivables existing at the close of business
on the Trust Cut Off Date and thereafter arising from time to time in the
Initial Accounts and the Receivables existing on each applicable Addition Date
and thereafter arising from time to time in the Accounts in the Restatement Date
Portfolios identified in the Account Schedule delivered on August 20, 2001 and
the Automatic Additional Accounts, all Recoveries allocable to the Trust as
provided herein, all moneys due or to become due and all amounts received with
respect to, and proceeds of, any of the foregoing, (ii) all of its rights,
remedies, powers and privileges under the Receivables Purchase Agreement and
(iii) without limiting the generality of the foregoing or the following, all of
Transferor's rights pursuant to the Receivables Purchase Agreement to receive
from the RPA Seller payments made by any Merchant under any Credit Card
Processing Agreement on account of amounts received by such Merchant in payment
of Receivables ("IN-STORE PAYMENTS") and all proceeds of such rights. Such
property, together with all moneys on deposit in the Collection Account, the
Excess Funding Account and the Series Accounts and any Enhancement shall
constitute the assets of the Trust (the "TRUST ASSETS"). The foregoing does not
constitute and is not intended to result in the creation or assumption by the
Trust, Trustee, any Investor Holders or any Enhancement Provider of any
obligation of the Credit Card Originator, Servicer, Transferor or any other
Person in connection with the Accounts or the Receivables or under any agreement
or instrument relating thereto, including any obligation to obligors, merchant
banks, merchants clearance systems or insurers. The parties hereto intend that
each transfer of Receivables and other property pursuant to the Agreement or any
Assignment constitute a sale, and not a secured borrowing, for accounting
purposes. If the foregoing transfer, assignment, setover and conveyance is not
deemed to be an absolute assignment of the subject property to the Trustee, for
the benefit of the Investor Holders, then it shall be deemed to constitute a
grant of a security interest in such property to the Trustee, for the benefit of
the Investor Holders, and the Transferor Interest shall be deemed to represent
Transferor's equity in the collateral granted.
(b) Transferor agrees to record and file, at its own expense, financing statements (and continuation statements when applicable) with respect to the Receivables now existing and
hereafter created in Accounts owned by the Credit Card Originator and other Trust Assets 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 assignment of such Receivables to the Trust, and to deliver a file stamped copy of each such financing statement or other evidence of such filing (which may, for purposes of this SECTION 2.1 consist of telephone confirmation of such filing promptly followed by delivery to Trustee of a file-stamped copy) to Trustee on or prior to the Initial Closing Date, in the case of such Receivables arising in the Initial Accounts and Automatic Additional Accounts included in the Identified Portfolio, and (if any additional filing is so necessary) the applicable Addition Date, in the case of such Receivables arising in Supplemental Accounts and any related Automatic Additional Accounts. Trustee shall be under no obligation whatsoever to file or maintain such financing or continuation statements or to make any other filing under the UCC in connection with such assignment.
(c) Transferor further agrees, at its own expense, (i) on or prior to (A) the Automatic Addition Termination Date or any Automatic Addition Suspension Date, or subsequent to a Restart Date, in the case of the Initial Accounts and any Additional Accounts designated pursuant hereto prior to such date, (B) the applicable Addition Date, in the case of Supplemental Accounts and (C) the applicable Removal Date, in the case of Removed Accounts, to cause to be indicated in the appropriate computer files that Receivables created in connection with the Accounts owned by the Credit Card Originator (other than Removed Accounts) have been conveyed to the Trust pursuant to this Agreement for the benefit of the Holders (or conveyed to Transferor or its designee in accordance with SECTION 2.9, in the case of Removed Accounts) by including in such computer files the code identifying each such Account (or, in the case of Removed Accounts, either including such a code identifying the Removed Accounts only if the removal occurs prior to the Automatic Addition Termination Date or an Automatic Addition Suspension Date, or subsequent to a Restart Date, or deleting such code thereafter) and (ii) on or prior to the date referred to in CLAUSES (i)(A), (B) or (C), as applicable, to deliver to Trustee an Account Schedule (PROVIDED that such Account Schedule shall be provided in respect of Automatic Additional Accounts on or prior to the Determination Date relating to the Monthly Period during which their respective Addition Dates occur), specifying for each such Account, as of the Automatic Addition Termination Date or Automatic Addition Suspension Date, in the case of CLAUSE (i)(B), the applicable Addition Cut Off Date, in the case of Supplemental Accounts, and the Removal Date, in the case of Removed Accounts, its account number, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables outstanding in such Account. Such Account Schedule shall be supplemented from time to time to reflect Supplemental Accounts and Removed Accounts. Once the code referenced in CLAUSE (i) of this paragraph has been included with respect to any Account, Transferor further agrees not to permit such code to be altered during the remaining term of this Agreement unless and until (x) such Account becomes a Removed Account, (y) a Restart Date has occurred on which the Transferor starts including Automatic Additional Accounts as Accounts or (z) Transferor shall have delivered to Trustee at least 30 days' prior written notice of its intention to do so and has taken such action as is necessary or advisable to cause the interest of Trustee in the Receivables and other Trust Assets to continue to be perfected with the priority required by this Agreement.
(d) By executing this Agreement and the Receivables Purchase Agreement, the parties hereto and thereto do not intend to cancel, release or in any way impair the conveyance made by
WFN, in its capacity as "Transferor" under the Existing PSA. Without limiting the foregoing, the parties hereto acknowledge and agree as follows:
(i) Any transfer, assignment or other conveyance by the RPA Seller to the Transferor of assets under the Receivables Purchase Agreement or under any Transaction Document shall be subject to any rights in such assets granted by WFN, as "Transferor" under the Existing PSA, to the Trustee pursuant to the Existing PSA.
(ii) The trust created by and maintained under the Existing PSA shall continue to exist and be maintained under this Agreement.
(iii) All series of investor certificates issued under the Existing PSA shall constitute Series issued and outstanding under this Agreement, and any supplement executed in connection with such series shall constitute a Supplement executed hereunder.
(iv) All references to the Existing PSA in any other instruments or documents shall be deemed to constitute references to this Agreement. All references in such instruments or documents to WFN in its capacity as the "Transferor" of receivables and related assets under the Existing PSA shall be deemed to include reference to the Transferor in such capacity hereunder.
(v) The Transferor hereby assumes and agrees to perform all obligations of WFN, in its capacity as "Transferor" (but not as "Servicer"), under or in connection with the Existing PSA (as amended and restated by this Agreement) and any supplements to the Existing PSA.
(vi) To the extent this Agreement requires that certain actions are to be taken as of the Initial Closing Date or another date prior to the Effective Date, WFN's execution of such action under the Existing PSA shall constitute satisfaction of such requirement.
SECTION 2.2. ACCEPTANCE BY TRUSTEE. (a) Trustee accepts on behalf of the Trust all right, title and interest to the property, now existing and hereafter created, conveyed to the Trust pursuant to SECTION 2.1 and declares that it shall maintain such right, title and interest, upon the trust herein set forth, for the benefit of all Holders.
(b) Trustee shall have no power to create, assume or incur indebtedness or other liabilities in the name of the Trust other than as contemplated in this Agreement or any Supplement. Trustee, in the name of the Trust, shall have no power to hold any derivative financial instrument unless such derivative financial instrument complies with the requirements of paragraph 40 of Statement of Financial Accounting Standards No. 140 issued by the Financial Accounting Standards Board, including any interpretations thereof or any successor regulations issued by the Financial Accounting Standards Board.
SECTION 2.3. REPRESENTATIONS AND WARRANTIES OF TRANSFEROR RELATING TO TRANSFEROR. Transferor represents and warrants to the Trust as of each Closing Date and as of the Effective Date as follows:
(a) ORGANIZATION AND GOOD STANDING. Transferor is a limited liability company validly existing in good standing under the laws of the State of Delaware, and has full power, authority and legal right to own its properties and conduct its business as presently owned and conducted, to execute, deliver and perform its obligations under each Transaction Document and to execute and deliver to Trustee the Certificates.
(b) DUE QUALIFICATION. Transferor is duly qualified to do business and is in good standing as a foreign limited liability company (or is exempt from such requirements), and has obtained all necessary licenses and approvals in each jurisdiction in which failure to so qualify or to obtain such licenses and approvals would render any Credit Card Agreement or any Receivable transferred to the Trust by Transferor unenforceable by the Credit Card Originator, Transferor, Servicer or Trustee and would have a material adverse effect on the interests of the Holders hereunder or under any Supplement.
(c) DUE AUTHORIZATION. The execution, delivery and performance of this Agreement and each other Transaction Document by Transferor, the execution and delivery to Trustee of the Certificates by Transferor and the consummation by Transferor of the transactions provided for in each Transaction Document have been duly authorized by Transferor by all necessary limited liability company action on the part of Transferor.
(d) NO CONFLICT. The execution and delivery by Transferor of each Transaction Document and the Certificates, the performance by Transferor of the transactions contemplated by each Transaction Document and the fulfillment by Transferor of the terms hereof and thereof will not conflict with, result in any breach of any of the material terms and provisions of, or constitute (with or without notice or lapse of time or both) a material default under, any indenture, contract, agreement, mortgage, deed of trust, or other instrument to which Transferor is a party or by which it or any of its properties are bound.
(e) NO VIOLATION. The execution and delivery by Transferor of each Transaction Document and the Certificates, the performance by Transferor of the transactions contemplated by this Agreement and each Supplement and the fulfillment by Transferor of the terms hereof and thereof will not conflict with or violate any Requirements of Law applicable to Transferor.
(f) NO PROCEEDINGS. There are no proceedings or investigations pending or,
to the best knowledge of Transferor, threatened against Transferor, before any
court, regulatory body, administrative agency, or other tribunal or governmental
instrumentality (i) asserting the invalidity of any Transaction Document or the
Certificates, (ii) seeking to prevent the issuance of the Certificates or the
consummation of any of the transactions contemplated by any Transaction Document
or the Certificates, (iii) seeking any determination or ruling that, in the
reasonable judgment of Transferor, would materially and adversely affect the
performance by Transferor of its obligations under any Transaction Document,
(iv) seeking any determination or ruling that would materially and adversely
affect the validity or enforceability of any Transaction Document or the
Certificates or (v) seeking to affect adversely the income tax attributes of the
Trust under the Federal or applicable state income or franchise tax systems.
(g) ALL CONSENTS REQUIRED. All approvals, authorizations, consents, orders or other actions of any Person or of any governmental body or official required in connection with the
execution and delivery by Transferor of each Transaction Document and the Certificates, the performance by Transferor of the transactions contemplated by each Transaction Document and the fulfillment by Transferor of the terms hereof and thereof, have been obtained.
(h) INSOLVENCY. No Insolvency Event with respect to Transferor has occurred. Transferor did not (i) execute the Transaction Documents, (ii) grant to the Trustee the security interests described in SECTION 2.1, (iii) cause, permit, or suffer the perfection or attachment of such a security interest, (iv) otherwise effectuate or consummate any transfer to Trustee pursuant to any Transaction Document or (v) acquire its interest in the Trust, in each case:
(A) in contemplation of insolvency;
(B) with a view to preferring one creditor over another or to preventing the application of its assets in the manner required by applicable law or regulations;
(C) after committing an act of insolvency; or
(D) with any intent to hinder, delay, or defraud itself or its creditors.
(i) TRUSTEE. Trustee is not an insider or Affiliate of Transferor.
The representations and warranties of Transferor set forth in this SECTION 2.3 shall survive the transfer and assignment by Transferor of the respective Receivables to the Trust. Upon discovery by Transferor, Servicer or Trustee of a breach of any of the representations and warranties by Transferor set forth in this SECTION 2.3, the party discovering such breach shall give prompt written notice to the others and to each Enhancement Provider, if any, entitled thereto pursuant to the relevant Supplement. Transferor agrees to cooperate with Servicer and Trustee in attempting to cure any such breach. For purposes of the representations and warranties set forth in this SECTION 2.3, each reference to a Supplement shall be deemed to refer only to those Supplements in effect as of the relevant Closing Date.
SECTION 2.4. REPRESENTATIONS AND WARRANTIES OF TRANSFEROR RELATING TO
TRANSACTION DOCUMENTS AND THE RECEIVABLES. (a) Representations and Warranties.
Transferor represents and warrants to the Trust as of the Effective Date, each
Closing Date and, with respect to Additional Accounts, the related Addition Date
that:
(i) each Transaction Document and, in the case of Supplemental Accounts, the related Assignment, each constitutes a legal, valid and binding obligation of Transferor, enforceable against Transferor in accordance with its terms, except as such enforceability may be limited by applicable Debtor Relief Laws now or hereafter in effect and by general principles of equity (whether considered in a suit at law or in equity);
(ii) as of the Automatic Addition Termination Date or any Automatic Addition Suspension Date and as of each subsequent Addition Date with respect to Supplemental Accounts, and as of the applicable Removal Date with respect to the Removed Accounts, the Account Schedule delivered pursuant to this Agreement, as supplemented to such date, is an accurate and complete listing in all material respects of all the Accounts as of such Automatic Addition Termination Date, such Automatic Addition Suspension Date,
the related Addition Cut Off Date or such Removal Date, as the case may be, and the information contained therein with respect to the identity of such Accounts and the Receivables existing in such Accounts is true and correct in all material respects as of such specified date;
(iii) Transferor is the legal and beneficial owner of all right, title and interest in each Receivable and Transferor has the full right to transfer such Receivables to the Trust, and each Receivable conveyed to the Trust by Transferor has been conveyed to the Trust free and clear of any Lien of any Person claiming through or under Transferor or any of its Affiliates (other than Liens permitted under SECTION 2.7(b)) and in compliance, in all material respects, with all Requirements of Law applicable to Transferor;
(iv) all authorizations, consents, orders or approvals of or registrations or declarations with any Governmental Authority required to be obtained, effected or given by Transferor in connection with the conveyance by Transferor of Receivables to the Trust have been duly obtained, effected or given and are in full force and effect;
(v) this Agreement or, in the case of Supplemental Accounts, the related Assignment constitutes either a valid transfer and assignment to the Trust of all right, title and interest of Transferor in the Receivables and other Trust Assets conveyed to the Trust by Transferor and all monies due or to become due with respect thereto and the proceeds thereof or a grant of a security interest in such property to the Trustee, for the benefit of the Investor Holders, which, in the case of existing Receivables and the proceeds thereof, is enforceable upon execution and delivery of this Agreement, or, with respect to then existing Receivables in Additional Accounts, as of the applicable Addition Date, and which will be enforceable with respect to such Receivables hereafter and thereafter created and the proceeds thereof upon such creation, in each case except as such enforceability may be limited by applicable Debtor Relief Laws, now or hereafter in effect, and by general principles of equity (whether considered in a suit at law or in equity). Upon the filing of the financing statements pursuant to SECTION 2.1 and, in the case of Receivables hereafter created and the proceeds thereof, upon the creation thereof, the Trust shall have a first priority security interest in such property and proceeds except for Liens permitted under SECTION 2.7(b);
(vi) except as otherwise expressly provided in this Agreement or any Supplement, neither Transferor nor any Person claiming through or under Transferor has any claim to or interest in the Collection Account, the Excess Funding Account, any Series Account or any Enhancement;
(vii) on the Trust Cut Off Date, with respect to each Initial Account, on the date of its creation or the date it otherwise becomes an Automatic Additional Account, with respect to each Automatic Additional Account and, on the applicable Addition Cut Off Date, with respect to each related Supplemental Account, each such Account is an Eligible Account;
(viii) on the Trust Cut Off Date, each Receivable then existing is an Eligible Receivable, on the date of creation of each Automatic Additional Account or the date the
related account otherwise becomes an Automatic Additional Account, each Receivable contained in such Automatic Additional Account is an Eligible Receivable and, on the applicable Addition Cut Off Date, each Receivable contained in any related Supplemental Account is an Eligible Receivable; and
(ix) as of the date of the creation of any new Receivable, such Receivable is an Eligible Receivable.
(b) PERFECTION REPRESENTATIONS AND WARRANTIES. Transferor hereby makes the Perfection Representations and Warranties to the Trust. The rights and remedies with respect to any breach of the Perfection Representations and Warranties made under this SECTION 2.4(b) shall be continuing and shall survive any termination of this Agreement. Neither the Trust nor the Trustee shall waive a breach of any Perfection Representation and Warranty. In order to evidence the interests of the Transferor and the Trust under this Agreement, the Transferor and Servicer shall, from time to time take such action, and execute and deliver such instruments (including, without limitation, such actions or filings as are requested by the Trustee and financing statements under the UCC as enacted and then in effect in any other jurisdiction in which the Transferor is organized, has its principal place of business or maintains any books, records, files, or other information concerning the Receivables) in order to maintain and perfect, as a first priority interest, the security interest in the Receivables. The Transferor hereby authorizes Servicer to file financing statements under the UCC without the Transferor's signature where allowed by applicable law.
(c) NOTICE OF BREACH. The representations and warranties of Transferor set forth in this SECTION 2.4 shall survive the transfer and assignment by Transferor of Receivables to the Trust. Upon discovery by Transferor, Servicer or Trustee of a breach of any of the representations and warranties by Transferor set forth in this SECTION 2.4, the party discovering such breach shall give prompt written notice to the others and to each Enhancement Provider, if any, entitled thereto pursuant to the relevant Supplement. Transferor agrees to cooperate with Servicer and Trustee in attempting to cure any such breach. For purposes of the representations and warranties set forth in this SECTION 2.4, each reference to a Supplement shall be deemed to refer only to those Supplements in effect as of the date of the relevant representations or warranties.
SECTION 2.5. REASSIGNMENT OF INELIGIBLE RECEIVABLES. (a) REASSIGNMENT OF
RECEIVABLES. If (i) any representation or warranty of Transferor contained in
SECTION 2.4(a)(ii), (iii), (iv), (vii), (viii) or (ix) is not true and correct
in any material respect as of the date specified therein with respect to any
Receivable transferred to the Trust by Transferor or any Account and as a result
of such breach any Receivables in the related Account become Defaulted
Receivables or the Trust's rights in, to or under such Receivables or the
proceeds of such Receivables are impaired or such proceeds are not available for
any reason to the Trust free and clear of any Lien, unless cured within 60 days
(or such longer period, not in excess of 150 days, as may be agreed to by
Trustee) after the earlier to occur of the discovery thereof by Transferor or
receipt by Transferor or a designee of Transferor of notice thereof given by
Trustee, or (ii) it is so provided in SECTION 2.7(a) with respect to any
Receivables transferred to the Trust by Transferor, then such Receivable shall
be designated an "INELIGIBLE RECEIVABLE" and shall be assigned a principal
balance of zero for the purpose of determining the aggregate amount of Principal
Receivables on any day; PROVIDED that such Receivables will not be deemed to be
Ineligible
Receivables but will be deemed Eligible Receivables and such Principal
Receivables shall be included in determining the aggregate Principal Receivables
in the Trust if, on any day prior to the end of such 60-day or longer period,
(x) either (A) in the case of an event described in CLAUSE (i), the relevant
representation and warranty shall be true and correct in all material respects
as if made on such day or (B) in the case of an event described in CLAUSE (ii),
the circumstances causing such Receivable to become an Ineligible Receivable
shall no longer exist and (y) Transferor shall have delivered an Officer's
Certificate describing the nature of such breach and the manner in which the
relevant representation and warranty became true and correct.
(b) PRICE OF REASSIGNMENT. On and after the date of its designation as an Ineligible Receivable, each Ineligible Receivable shall not be given credit in determining the aggregate amount of Principal Receivables used to calculate the Transferor Amount or the Investor Percentages applicable to any Series. If, following the exclusion of such Principal Receivables from the calculation of the Transferor Amount, the Transferor Amount would be less than the Specified Transferor Amount, Transferor shall make a deposit into the Excess Funding Account in immediately available funds prior to the next succeeding Business Day in an amount equal to the amount by which the Transferor Amount would be less than the Specified Transferor Amount (up to the amount of such Principal Receivables). The payment of such deposit amount in immediately available funds shall otherwise be considered payment in full of all of the Ineligible Receivables.
The obligation of Transferor to make the deposits, if any, required to be made to the Excess Funding Account as provided in this Section, shall constitute the sole remedy respecting the event giving rise to such obligation available to Holders (or Trustee on behalf of the Holders) or any Enhancement Provider.
SECTION 2.6. REASSIGNMENT OF RECEIVABLES IN TRUST PORTFOLIO. If any representation or warranty of Transferor set forth in SECTION 2.3(a), (b) or (c) or SECTION 2.4(a)(i), (v) or (vi) is not true and correct in any material respect and such breach has a material adverse effect on the Investor Interest in the Receivables transferred to the Trust by Transferor, then either Trustee or the Majority Holders, by notice then given to Transferor and Servicer (and to Trustee if given by the Investor Holders), may direct Transferor to accept a reassignment of the Receivables transferred to the Trust by 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 150 days, as may be specified in such notice), and upon those conditions Transferor shall be obligated to accept such reassignment on the terms set forth below; PROVIDED that such Receivables will not be reassigned to Transferor if, on any day prior to the end of such 60-day or longer period (i) the relevant representation and warranty shall be true and correct in all material respects as if made on such day and (ii) Transferor shall have delivered an Officer's Certificate describing the nature of such breach and the manner in which the relevant representation and warranty became true and correct.
Transferor shall deposit in the Collection Account in immediately available funds not later than 12:00 noon, New York City time, on the first Distribution Date following the Monthly Period in which such reassignment obligation arises, in payment for such reassignment, an amount equal to the sum of the amounts specified therefor with respect to each outstanding Series in the related Supplement. Notwithstanding anything to the contrary in this Agreement,
such amounts shall be distributed on such Distribution Date in accordance with ARTICLE IV and each Supplement. The payment of such deposit amount in immediately available funds shall otherwise be considered payment in full of all of the Receivables.
Upon the deposit, if any, required to be made to the Collection Account as provided in this Section or SECTION 2.5, Trustee, on behalf of the Trust, shall automatically and without further action be deemed to transfer, assign, set over and otherwise convey to Transferor or its designee, without recourse, representation or warranty (except for the warranty that since the date of transfer by Transferor, Trustee has not sold, transferred or encumbered any such Receivables or interest therein), all the right, title and interest of the Trust in and to the applicable Receivables, all moneys due or to become due and all amounts received with respect thereto and all proceeds thereof. Trustee shall execute such documents and instruments of transfer or assignment and take such other actions as shall reasonably be requested by Transferor to effect the conveyance of such Receivables pursuant to this Section. The obligation of Transferor to accept reassignment of any Receivables, and to make the deposits, if any, required to be made to the Collection Account as provided in this Section, shall constitute the sole remedy respecting the event giving rise to such obligation available to Holders (or Trustee on behalf of the Holders).
SECTION 2.7. Covenants of Transferor. Transferor covenants as follows:
(a) RECEIVABLES TO BE ACCOUNTS. Except in connection with the enforcement or collection of an Account, Transferor will take no action to cause any Receivable transferred by it to the Trust to be evidenced by any instrument and, if any such Receivable is so evidenced (whether or not in connection with the enforcement or collection of an Account), it shall be deemed to be an Ineligible Receivable in accordance with SECTION 2.5(a) and shall be reassigned to Transferor in accordance with SECTION 2.5(b).
(b) SECURITY INTERESTS. Except for the conveyances hereunder, Transferor will not sell, pledge, assign or transfer or otherwise convey to any other Person, or grant, create, incur, assume or suffer to exist any Lien on any Receivable, whether now existing or hereafter created, or any interest therein; Transferor will immediately notify Trustee of the existence of any Lien on any Receivable of which Transferor has knowledge; and Transferor shall defend the right, title and interest of the Trust in, to and under the Receivables, whether now existing or hereafter created, against all claims of third parties claiming through or under Transferor or RPA Seller; PROVIDED that nothing in this SECTION 2.7(b) shall prevent or be deemed to prohibit Transferor from suffering to exist upon any of the Receivables any Liens for taxes if such taxes shall not at the time be due and payable or if Transferor or RPA Seller, as applicable, shall currently be contesting the validity thereof in good faith by appropriate proceedings and shall have set aside on its books adequate reserves with respect thereto. Notwithstanding the foregoing, nothing in this SECTION 2.7(b) shall be construed to prevent or be deemed to prohibit the transfer of the Transferor Interest and certain other rights of Transferor in accordance with this Agreement and any related Supplement.
(c) TRANSFEROR INTEREST. Except as otherwise permitted herein, including in SECTIONS 2.11, 6.3 and 7.2, Transferor agrees not to transfer, assign, exchange or otherwise convey or pledge, hypothecate or otherwise grant a security interest in the Transferor Interest (or any interest therein) or any Supplemental Interest (or any interest
therein) and any such attempted transfer, assignment, exchange, conveyance, pledge, hypothecation or grant shall be void.
(d) DELIVERY OF COLLECTIONS OR RECOVERIES. If Transferor receives Collections or Recoveries, then Transferor agrees to pay Servicer all such Collections and Recoveries as soon as practicable after receipt thereof but in no event later than two Business Days after the Date of Processing by Transferor.
(e) NOTICE OF LIENS. Transferor shall notify Trustee and each Enhancement Provider, if any, entitled to such notice pursuant to the relevant Supplement promptly after becoming aware of any Lien on any Receivable other than the conveyances hereunder or Liens permitted under SECTION 2.7(b).
(f) CONTINUOUS PERFECTION. Transferor shall not change its name, identity or structure in any manner that might cause any financing or continuation statement filed pursuant to this Agreement to be misleading within the meaning of Section 9-402(7) of the UCC (or any other then applicable provision of the UCC) unless Transferor shall have delivered to Trustee at least 30 days prior written notice thereof and, no later than 30 days after making such change, shall have taken all action necessary or advisable to amend such financing statement or continuation statement so that it is not misleading. Transferor shall not change its chief executive office, jurisdiction of organization or change the location of its principal records concerning the Receivables, the Trust Assets or the Collections unless it has delivered to Trustee at least 30 days prior written notice of its intention to do so and has taken such action as is necessary or advisable to cause the interest of Trustee in the Receivables and other Trust Assets to continue to be perfected with the priority required by this Agreement.
(g) CREDIT CARD AGREEMENT AND GUIDELINES. Transferor shall enforce the covenant in the Receivables Purchase Agreement requiring the Credit Card Originator to comply with and perform its obligations under the Credit Card Agreements relating to the Accounts and the Credit Card Guidelines except insofar as any failure to comply or perform would not materially or adversely affect the rights of the Trust or the Holders under any Transaction Document or the Certificates. Transferor may permit the Credit Card Originator to change the terms and provisions of the Credit Card Agreements or the Credit Card Guidelines in any respect (including the reduction of the required minimum monthly payment, the calculation of the amount, or the timing, of charge offs and Periodic Finance Charges and other fees assessed thereon), but only if such change is made applicable to any comparable segment of the revolving credit card accounts owned and serviced by the Credit Card Originator which have characteristics the same as, or substantially similar to, the Accounts that are the subject of such change, except as otherwise restricted by an endorsement, sponsorship or other agreement between Transferor and an unrelated third party or by the terms of the Credit Card Agreements.
(h) RECEIVABLES PURCHASE AGREEMENT. Transferor, in its capacity as purchaser of Receivables from RPA Seller under the Receivables Purchase Agreement, shall enforce the covenants and agreement of RPA Seller as set forth in the Receivables Purchase Agreement if the failure of RPA Seller to comply with such covenants and agreements would (i) result in the occurrence of an Early Amortization Event or (b) materially and adversely effect the amount or
timing of distributions to be made to the Investor Certificateholders of any Series or Class pursuant to the Transaction Documents.
(i) OFFICIAL RECORDS. The resolutions of Transferor's Board of Directors approving each of the Transaction Documents and all documents relating thereto are and shall be continuously reflected in the minutes of Transferor's Board of Directors. Each of the Transaction Documents and all documents relating thereto are and shall, continuously from the time of their respective execution by Transferor, be official records of Transferor.
(j) ACCOUNT ALLOCATIONS. If Transferor is unable for any reason to transfer Receivables to the Trust in accordance with the provisions of this Agreement (including by reason of the application of the provisions of SECTION 9.2 or an order by any Federal governmental agency having regulatory authority over Transferor or any court of competent jurisdiction that Transferor not transfer any additional Principal Receivables to the Trust) then, in any such event: (A) Transferor agrees to allocate and pay to the Trust, after the date of such inability, all Collections with respect to Principal Receivables, all Discount Option Receivables Collections, and all amounts which would have constituted Collections with respect to Principal Receivables and all Discount Option Receivables Collections but for Transferor's inability to transfer such Receivables (up to an aggregate amount equal to the amount of Principal Receivables and the Discount Option Receivables Amount in the Trust on such date); (B) Transferor agrees to have such amounts applied as Collections in accordance with ARTICLE IV; and (C) for only so long as all Collections and all amounts which would have constituted Collections are allocated and applied in accordance with CLAUSES (A) and (B), Principal Receivables and Discount Option Receivables (and all amounts which would have constituted Principal Receivables or Discount Option Receivables, as the case may be, but for Transferor's inability to transfer Receivables to the Trust) that are charged off as uncollectible in accordance with this Agreement shall continue to be allocated in accordance with ARTICLE IV, and all amounts that would have constituted Principal Receivables or Discount Option Receivables, as the case may be, but for Transferor's inability to transfer Receivables to the Trust shall be deemed to be Principal Receivables or Discount Option Receivables, as the case may be, for the purpose of calculating the applicable Investor Percentage with respect to any Series. If Transferor is unable pursuant to any Requirement of Law to allocate Collections as described above, Transferor agrees that it shall in any such event allocate, after the occurrence of such event, payments on each Account with respect to the principal balance of such Account first to the oldest principal balance of such Account and to have such payments applied as Collections in accordance with ARTICLE IV. The parties hereto agree that Finance Charge Receivables, whenever created, accrued in respect of Principal Receivables that have been conveyed to the Trust, or that would have been conveyed to the Trust but for the above described inability to transfer such Receivables, shall continue to be a part of the Trust notwithstanding any cessation of the transfer of additional Principal Receivables and Discount Option Receivables to the Trust, and Collections with respect thereto shall continue to be allocated and paid in accordance with ARTICLE IV.
(k) PERIODIC FINANCE CHARGES AND OTHER FEES. Transferor hereby agrees that, except as otherwise required by any Requirement of Law, or as is deemed by the Credit Card Originator to be necessary in order for it to maintain its credit card business, based upon a good faith assessment by the Credit Card Originator, in its sole discretion, of the nature of the competition in the credit card business, it shall not at any time permit the Credit Card Originator to reduce the
Periodic Finance Charges assessed on any Receivable or other fees on any Account if, as a result of such reduction, Transferor's reasonable expectation of the Portfolio Yield for any Series as of such date would be less than the then Base Rate for that Series.
(l) NOTICES OF CERTAIN EVENTS. Transferor shall promptly notify each Rating Agency after Transferor obtains knowledge that: (i) the Welsh, Carson, Anderson & Stowe Partnerships and The Limited and its Affiliates (in the aggregate) fail to own a majority of the outstanding common stock of Holding (PROVIDED that common stock owned by employees, either individually or through employee stock ownership or other stock based benefit plans, shall not be included in the calculation of ownership interests for this purpose); (ii) any Merchant whose program gives rise to more than 10% of the Principal Receivables (measured as of the end of the most recent Monthly Period) terminates its private label credit card program with the Bank; (iii) the Trustee gives a resignation notice pursuant to SECTION 11.7; or (iv) an Additional Limitation Event or an Automatic Addition Limitation Event occurs.
(m) AMENDMENT OF ORGANIZATIONAL DOCUMENTS. Transferor shall not amend in any material respect its certificate of formation or its limited liability company agreement without providing the Rating Agencies with notice no later than the fifth Business Day prior to such amendment (unless the right to such notice is waived by the Rating Agency) and satisfying the Rating Agency Condition.
(n) OTHER INDEBTEDNESS. Except as contemplated by the Receivables Purchase Agreement, the Transferor shall not incur any additional debt, unless (i) such debt is contemplated by the Transaction Documents or (ii) the Rating Agencies are 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 the Rating Agency) and the Rating Agency Condition is satisfied with respect to the incurrence of such debt.
(o) SEPARATE CORPORATE EXISTENCE. The 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 organization 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 Receivables Purchase Agreement and each other instrument or agreement necessary or appropriate to proper administration hereof and permit and effectuate the transactions contemplated hereby.
(ii) Except as provided herein, maintain its own deposit, securities and other account or accounts, separate from those of any Affiliate of the Transferor, with financial institutions. The funds of the Transferor shall not be diverted to any other Person or for other than the corporate use of the Transferor, and, except as may be expressly permitted by this Agreement or the Receivables Purchase Agreement, the funds of the Transferor shall not be commingled with those of any other person or entity.
(iii) Ensure that, to the extent that it shares the same officers or other employees as any of its stockholders or Affiliates, the salaries of and the expenses related to
providing benefits to such officers and other employees shall be fairly allocated among such entities, and each such entity shall bear its fair share of the salary and benefit costs associated with all such common officers and employees.
(iv) Ensure that, to the extent that it jointly contracts with any of its stockholders or Affiliates to do business with vendors or service providers or to share overhead expenses, the costs incurred in so doing shall be allocated fairly among entities, and each such entity shall bear its fair share of such costs. To the extent that the 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. All material transactions between the Transferor and any of its Affiliates shall be only on an arm's-length basis and shall receive the approval of the Transferor's Board of Directors including at least one Independent Director (defined below).
(v) Maintain a principal executive and administrative office through which its business is conducted and a telephone number separate from those of its stockholders and Affiliates. To the extent that the Transferor and any of its members or 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.
(vi) Conduct its affairs strictly in accordance with its certificate of formation and observe all necessary, appropriate and customary corporate formalities including, but not limited to, holding all regular and special directors' meetings appropriate to authorize all limited liability company 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 directors' meetings shall be held at least annually.
(vii) Ensure that decisions with respect to its business and daily operations shall be independently made by the Transferor (although the officer making any particular decision may also be an officer or director of an Affiliate of the Transferor) and shall not be dictated by any Affiliate of the Transferor.
(viii) Act solely in its own legal name and through its own authorized officers and agents, and, except as contemplated by the Transaction Documents, no Affiliate of the Transferor shall be appointed to act as agent of the Transferor. The Transferor shall at all times use its own stationery and business forms and describe itself as a separate legal entity.
(ix) Except as contemplated by the Receivables Purchase Agreement, ensure that none of its Affiliates shall advance funds to it, and no Affiliate of the Transferor will otherwise guaranty its debts.
(x) Other than organizational expenses and as expressly provided herein, pay all expenses, indebtedness and other obligations incurred by it using its own funds.
(xi) 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 of its Affiliates.
(xii) Ensure that any financial reports required of the Transferor shall comply with GAAP 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 the Transferor and such Affiliate and also state that the assets of the Transferor are not available to pay creditors of the Affiliate.
(xiii) Ensure that at all times it is adequately capitalized to engage in the transactions contemplated in its certificate of formation and limited liability company agreement.
SECTION 2.8. ADDITION OF ACCOUNTS. (a) AUTOMATIC ADDITIONAL ACCOUNTS.
Subject to the limitations specified below in this SECTION 2.8(a) and to any
further limitations specified in any Supplement, Automatic Additional Accounts
shall be included as Accounts from and after the date upon which they are
created, and all Receivables in Automatic Additional Accounts, whether such
Receivables are then existing or thereafter created, shall be transferred
automatically to the Trust upon their creation. For all purposes of this
Agreement, all receivables relating to Automatic Additional Accounts shall be
treated as Receivables upon their creation and shall be subject to the
eligibility criteria specified in the definitions of "Eligible Receivable" and
"Eligible Account." Transferor may elect at any time to terminate the inclusion
in Accounts of new accounts which would otherwise be Automatic Additional
Accounts as of any Business Day (the "AUTOMATIC ADDITION TERMINATION DATE"), or
suspend any such inclusion as of any Business Day (an "AUTOMATIC ADDITION
SUSPENSION DATE") until a date (the "RESTART DATE") to be notified in writing by
Transferor to Trustee by delivering to Trustee, Servicer and each Rating Agency
ten days prior written notice of such election at least 10 days prior to such
Automatic Addition Termination Date, Automatic Addition Suspension Date or
Restart Date, as the case may be. Promptly after each of an Automatic Addition
Termination Date, an Automatic Addition Suspension Date and a Restart Date,
Transferor and Trustee agree to execute, and Transferor agrees to record and
file at its own expense, an amendment to the financing statements referred to in
SECTION 2.1 to specify the accounts then subject to this Agreement (which
specification may incorporate a list of accounts by reference) and, except in
connection with any such filing made after a Restart Date, to release any
security interest in any accounts created after the Automatic Addition
Termination Date or Automatic Addition Suspension Date. Notwithstanding the
foregoing, during any period after an Automatic Addition Limitation Event has
occurred and before the Rating Agency Condition has been satisfied as to the
resumption of treating new accounts as Automatic Additional Accounts, no new
accounts that would otherwise be Automatic Additional Accounts shall be treated
as such on any Addition Date if the number of such Automatic Additional Accounts
would exceed an amount equal to the greater of:
(i) the excess (if any) of (1) 20% of the aggregate number of Accounts determined as of the first day of the fiscal year of Transferor in which the Addition Date occurs OVER (2) the aggregate amount of Automatic Additional Accounts and Supplemental Accounts the Addition Date for which has occurred since the first day of such fiscal year; and
(ii) the excess (if any) of (1) 15% of the aggregate number of Accounts determined as of the first day of the fiscal quarter of Transferor in which the Addition Date occurs OVER (2) the aggregate amount of Automatic Additional Accounts and Supplemental Accounts the Addition Date for which has occurred since the first day of such fiscal quarter.
In addition, no new account arising in a Restatement Date Portfolio will be treated as an Automatic Additional Account if, as a result of doing so, the aggregate amount of Principal Receivables in Accounts in the Restatement Date Portfolios would exceed 10% of the aggregate amount of Principal Receivables in the Trust; PROVIDED, HOWEVER, such limitation shall no longer apply after S&P shall have confirmed in writing that additions of such Accounts in excess of the 10% limitation shall not cause a reduction or withdrawal of the rating on any then outstanding Series or Class rated by S&P.
In addition, during any period after an Additional Limitation Event has occurred and before the Rating Agency Condition has been satisfied as to the resumption of treating new accounts as Automatic Additional Accounts, no new accounts that would otherwise be Automatic Additional Accounts shall be treated as such on any Addition Date if:
(i) the aggregate balance of Receivables in Automatic Additional Accounts and Supplemental Accounts designated during a twelve month (or shorter) period beginning on the Additional Limitation Event (or any anniversary thereof) would exceed an amount equal to the excess (if any) of 20% of the aggregate balance of Receivables determined as of the first day after the Additional Limitation Event (or such anniversary); or
(ii) the aggregate balance of Receivables in Automatic Additional Accounts and Supplemental Accounts designated during a three month (or shorter) period beginning on the Additional Limitation Event (or the first day of the third month commencing thereafter or of any ensuing third month) would exceed 15% of the aggregate balance of Receivables determined as of the first day after the occurrence of the Additional Limitation Event (or the first day of such third month or ensuing third month).
(b) REQUIRED ADDITIONS OF SUPPLEMENTAL ACCOUNTS. If during any period of thirty consecutive days, the Transferor Amount averaged over that period is less than the Minimum Transferor Amount for that period, Transferor shall designate additional Eligible Accounts ("SUPPLEMENTAL ACCOUNTS") to be included as Accounts in a sufficient amount such that the average of the Transferor Amount, computed by assuming that the amount of the Principal Receivables of such Supplemental Accounts shall be deemed to be outstanding in the Trust during each day of such 30-day period, is at least equal to the Minimum Transferor Amount. In addition, if on any Business Day the aggregate amount of Principal Receivables plus amounts on deposit in the Excess Funding Account is less than the Required Principal Balance, Transferor
shall designate Supplemental Accounts from any Approved Portfolio to be included as Accounts in a sufficient amount such that the aggregate amount of Principal Receivables plus amounts on deposit in the Excess Funding Account will be equal to or greater than the Required Principal Balance. Receivables from all such Supplemental Accounts shall be transferred to the Trust on or before the fifth Business Day following such thirty-day period or Business Day, as the case may be. In lieu of, or in addition to, designating Supplemental Accounts as required above, Transferor may convey to the Trust participations or trust certificates representing undivided legal or beneficial interests in a pool of assets primarily consisting of receivables arising under revolving credit card accounts or other revolving credit accounts owned by Transferor or any of its Affiliates and collections thereon ("PARTICIPATION INTERESTS"). Any addition of Participation Interests to the Trust (whether pursuant to this PARAGRAPH (b) or PARAGRAPH (c) below) shall be effected by an amendment hereto, dated the applicable Addition Date, pursuant to SUBSECTION 13.1(a).
(c) PERMITTED ADDITIONS. In addition to its obligation under PARAGRAPH
(b), Transferor may, but shall not be obligated to, from time to time designate
Supplemental Accounts or Participation Interests to be included as Trust Assets,
in either case as of the applicable Addition Date, so long as after giving
effect to such addition no more than 20% of the Receivables by outstanding
balance, will be 30 or more days delinquent.
(d) CERTAIN CONDITIONS FOR ADDITIONS OF SUPPLEMENTAL ACCOUNTS AND PARTICIPATION INTERESTS. Transferor agrees that any transfer of Receivables from Supplemental Accounts or Participation Interests under PARAGRAPHS (b) or (c) shall occur only upon satisfaction of the following conditions (to the extent applicable):
(i) on or before the tenth Business Day prior to the Addition Date (the "NOTICE DATE"), Transferor shall give Trustee, each Rating Agency and Servicer written notice that such Supplemental Accounts or Participation Interests will be included, which notice shall specify the approximate aggregate amount of the Receivables or Participation Interests to be transferred; and, in the case of any transfer pursuant to PARAGRAPH (c), the Rating Agency Condition shall have been satisfied;
(ii) on or before the Addition Date, Transferor shall have delivered to Trustee a written assignment (including an acceptance by Trustee on behalf of the Trust for the benefit of the Investor Holders) in substantially the form of EXHIBIT A (the "ASSIGNMENT") and the Credit Card Originator shall have indicated in its computer files that the Receivables created in connection with the Supplemental Accounts have been transferred to the Trust and, within five Business Days thereafter, Transferor shall have delivered to Trustee an Account Schedule listing such Supplemental Accounts, which as of the date of such Assignment, shall be deemed incorporated into and made a part of such Assignment and this Agreement;
(iii) Transferor shall represent and warrant that (x) each Supplemental Account is, as of the Addition Date, an Eligible Account, and each Receivable in such Supplemental Account is, as of the Addition Date, an Eligible Receivable, (y) no selection procedures believed by Transferor to be materially adverse to the interests of the Investor Holders were utilized in selecting the Additional Accounts from the available
Eligible Accounts in an Approved Portfolio, and (z) as of the Addition Date, Transferor is not insolvent;
(iv) Transferor shall represent and warrant that, as of the Addition
Date, the Assignment constitutes either (x) a valid transfer and
assignment to the Trust of all right, title and interest of Transferor in
and to the Receivables then existing and thereafter created in the
Supplemental Accounts, and all proceeds of such Receivables and Insurance
Proceeds relating thereto and such Receivables and all proceeds thereof
and Insurance Proceeds and Recoveries relating thereto will be held by the
Trust free and clear of any Lien of any Person claiming through or under
Transferor or any of its Affiliates, except for (i) Liens permitted under
SECTION 2.7(b), (ii) the interest of Transferor as Holder of the
Transferor Interest and (iii) Transferor's right to receive interest
accruing on, and investment earnings in respect of, the Excess Funding
Account, or any Series Account as provided in this Agreement and any
related Supplement or (y) a grant of a security interest in such property
to the Trustee, for the benefit of the Investor Holders, which is
enforceable with respect to then existing Receivables in the Supplemental
Accounts, the proceeds thereof and Insurance Proceeds and Recoveries
relating thereto upon the conveyance of such Receivables to the Trust, and
which will be enforceable with respect to the Receivables thereafter
created in respect of Supplemental Accounts conveyed on such Addition
Date, the proceeds thereof and Insurance Proceeds and Recoveries relating
thereto upon such creation; and (z) if the Assignment constitutes the
grant of a security interest to the Trustee in such property, upon the
filing of a financing statement as described in SECTION 2.1 with respect
to such Supplemental Accounts and in the case of the Receivables
thereafter created in such Supplemental Accounts and the proceeds thereof,
and Insurance Proceeds and Recoveries relating thereto, upon such
creation, the Trust shall have a first priority perfected security
interest in such property (subject to Section 9-306 of the UCC), except
for Liens permitted under SECTION 2.7(b);
(v) Transferor shall deliver an Officer's Certificate to Trustee confirming the items set forth in CLAUSE (ii); and
(vi) Transferor shall deliver an Opinion of Counsel with respect to the Receivables in the Supplemental Accounts to Trustee (with a copy to each Rating Agency) substantially in the form of EXHIBIT E-2.
(e) ADDITIONAL APPROVED PORTFOLIOS. As of August 21, 2001, each of the Restatement Date Portfolios is designated as an Approved Portfolio. The Transferor may also from time to time designate additional portfolios of accounts as "Approved Portfolios" if the Rating Agency Condition is satisfied with respect to that designation (except as to any Series or Class that expressly waives this requirement in the applicable Supplement). Transferor agrees that prior to any transfer of Receivables from Automatic Additional Accounts arising in a portfolio that is designated as an Approved Portfolio pursuant to the immediately preceding sentence Transferor shall satisfy the following requirements:
(i) on or before the tenth Business Day prior to the Addition Date, Transferor shall give Trustee, each Rating Agency and Servicer written notice that such Automatic Additional Accounts will be included;
(ii) on or before the Addition Date, Transferor shall have delivered to Trustee a written Assignment (including an acceptance by Trustee on behalf of the Trust for the benefit of the Investor Holders) substantially in the form of EXHIBIT A (with appropriate modifications) and the Credit Card Originator shall have indicated in its computer files that the Receivables created in connection with the Automatic Additional Accounts have been transferred to the Trust;
(iii) Transferor shall represent and warrant that (x) each Automatic Additional Account is, as of the Addition Date, an Eligible Account, and each Receivable in such Automatic Additional Account is, as of the Addition Date, an Eligible Receivable, (y) no selection procedures believed by Transferor to be materially adverse to the interests of the Investor Holders were utilized in selecting the new Approved Portfolio, and (z) as of the Addition Date, Transferor is not insolvent;
(iv) Transferor shall represent and warrant that, as of the Addition Date, the Assignment constitutes either (x) a valid transfer and assignment to the Trust of all right, title and interest of Transferor in and to the Receivables then existing and thereafter created in the Automatic Additional Accounts, and all proceeds of such Receivables and Insurance Proceeds relating thereto and such Receivables and all proceeds thereof and Insurance Proceeds and Recoveries relating thereto will be held by the Trust free and clear of any Lien of any Person claiming through or under Transferor or any of its Affiliates, except for (i) Liens permitted under SECTION 2.7(b), (ii) the interest of the Holder of the Transferor Interest and (iii) Transferor's right to receive interest accruing on, and investment earnings in respect of, the Excess Funding Account, or any Series Account as provided in this Agreement and any related Supplement or (y) a grant of a security interest in such property to the Trustee, for the benefit of the Investor Holders, which is enforceable with respect to then existing Receivables in the Automatic Additional Accounts, the proceeds thereof and Insurance Proceeds and Recoveries relating thereto upon the conveyance of such Receivables to the Trust, and which will be enforceable with respect to the Receivables thereafter created in respect of Automatic Additional Accounts conveyed on such Addition Date, the proceeds thereof and Insurance Proceeds and Recoveries relating thereto upon such creation; and (z) if the Assignment constitutes the grant of a security interest to the Trustee in such property, upon the filing of a financing statement as described in SECTION 2.1 with respect to such Automatic Additional Accounts and in the case of the Receivables thereafter created in such Automatic Additional Accounts and the proceeds thereof, and Insurance Proceeds and Recoveries relating thereto, upon such creation, the Trust shall have a first priority perfected security interest in such property (subject to Section 9-306 of the UCC), except for Liens permitted under SECTION 2.7(b);
(v) Transferor shall deliver an Officer's Certificate to Trustee confirming the items set forth in CLAUSE (ii); and
(vi) Transferor shall deliver an Opinion of Counsel with respect to the Receivables in the Automatic Additional Accounts to Trustee (with a copy to each Rating Agency) substantially in the form of EXHIBIT E-2 (with appropriate modifications).
SECTION 2.9. REMOVAL OF ACCOUNTS. (a) On any day of any Monthly Period 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 moneys due or to become due and all amounts received with respect thereto and all proceeds thereof in or with respect to the Accounts then owned by the Credit Card Originator and designated by Transferor (the "REMOVED ACCOUNTS") or Participation Interests (unless otherwise set forth in the applicable Supplement), upon satisfaction of the following conditions:
(i) on or before the tenth Business Day immediately preceding the Removal Date (the "REMOVAL NOTICE DATE") Transferor shall have given Trustee, Servicer, each Rating Agency and any Enhancement Provider entitled thereto pursuant to the relevant Supplement written notice of such removal and specifying the date for removal of the Removed Accounts and Participation Interests (the "REMOVAL DATE"); Transferor shall provide each Rating Agency with such additional information relating to such removal as the Rating Agency shall reasonably request;
(ii) with respect to Removed Accounts, on or prior to the date that is 10 Business Days after the Removal Date, Transferor shall have delivered to Trustee an Account Schedule listing the Removed Accounts and specifying for each such Account, as of the Removal Notice Date, its account number, the aggregate amount outstanding, and the aggregate amount of Principal Receivables outstanding in such Account;
(iii) with respect to Removed Accounts, Transferor shall have represented and warranted as of the Removal Date that the list of Removed Accounts delivered pursuant to PARAGRAPH (ii), as of the Removal Date, is true and complete in all material respects;
(iv) with respect to any removal pursuant to SECTION 2.9(b) that is being made as a result of the applicable Merchant exercising a purchase right as to which Transferor has no reasonable control (an "INVOLUNTARY REMOVAL"), Transferor shall use reasonable efforts to satisfy the Rating Agency Condition; and as to any other removal, the Rating Agency Condition shall have been satisfied;
(v) Transferor shall have delivered to Trustee and any Enhancement Provider entitled thereto pursuant to the relevant Supplement an Officer's Certificate, dated as of the Removal Date, to the effect that Transferor reasonably believes that (A) in the case of any removal other than an Involuntary Removal, such removal will not, based on the facts known to such officer at the time of such certification, then or thereafter cause an Early Amortization Event to occur with respect to any Series, (B) in the case of any Involuntary Removal, Transferor has used reasonable efforts to avoid having such removal result in an Early Amortization Event, (C) in either case, no selection procedure believed by Transferor to be materially adverse to the interests of the Investor Holders has been used in removing Removed Accounts from among any pool of Accounts or Participation Interests of a similar type (it being understood that Transferor will not be
deemed to have used such an adverse selection procedure in connection with any Involuntary Removal) and (D) in the case of any Removal other than an Involuntary Removal, Accounts (or administratively convenient groups of Accounts, such as billing cycles) were chosen for removal on a random basis or another basis that the Transferor believes is consistent with achieving derecognition of the Receivables under generally accepted accounting principles in the United States of America in effect from time to time;
(vi) in the case of any removal pursuant to SECTION 2.9(a), the aggregate Principal Receivables in the Removed Accounts shall not exceed the lesser of (A) the excess of the Transferor Amount over the Minimum Transferor Amount or (B) the excess of the aggregate amount of Principal Receivables plus amounts on deposit in the Excess Funding Account over the Required Principal Balance, all measured as of the end of the most recently ended Monthly Period;
(vii) in the case of any removal pursuant to SECTION 2.9(b), the removal shall not cause the Transferor Amount to be less than the Minimum Transferor Amount or cause the sum of the aggregate Principal Receivables plus the Excess Funding Account balance to be less than the Required Principal Balance; and
(viii) such removal shall not cause a decrease in the sum of the Invested Amounts for all outstanding Series.
Upon satisfaction of the above conditions, Trustee shall execute and deliver to Transferor or its designee a written reassignment in substantially the form of EXHIBIT B (the "REASSIGNMENT") and shall, without further action, be deemed to transfer, assign, set over and otherwise convey to 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 or the Participation Interests, all moneys due and to become due and all amounts received with respect thereto and all proceeds thereof. In addition, Trustee shall execute such other documents and instruments of transfer or assignment and take such other actions as shall reasonably be requested by Transferor to effect the conveyance of Receivables pursuant to this Section.
(b) Transferor may from time to time designate as Removed Accounts any
Accounts designated for purchase by a Merchant pursuant to the terms of the
related Credit Card Processing Agreement, PROVIDED THAT no Account included in
the Identified Portfolio may be designated a Removed Account until the Series
1996-A and Series 1996-B Certificates have been paid in full pursuant to this
SECTION 2.9(b). Any Trust's repurchase of the Receivables in Removed Accounts
designated pursuant to this SECTION 2.9(b) shall be effected in the manner and
at a price determined in accordance with SECTION 2.5(b), as if the Receivables
being repurchased were Ineligible Receivables. Amounts deposited in the
Collection Account in connection therewith shall be deemed to be Collections of
Principal Receivables and shall be applied in accordance with the terms of
ARTICLE IV and each Supplement.
SECTION 2.10. DISCOUNT OPTION. (a) Transferor shall have the option to designate at any time a fixed or floating percentage (the "DISCOUNT PERCENTAGE") of the amount of
Receivables arising in the Accounts on or after the date such designation becomes effective that would otherwise constitute Principal Receivables (prior to subtracting from Principal Receivables, Finance Charge Receivables that are Discount Option Receivables) to be treated as Finance Charge Receivables. Transferor may from time to time increase (subject to the limitations described below), reduce or eliminate the Discount Percentage for Discount Option Receivables arising in the Accounts on and after the date of such change. Transferor must provide 30 days' prior written notice to Servicer, Trustee and each Rating Agency of any such increase, reduction or elimination, and such increase, reduction or elimination shall become effective on the date specified therein only if (i) Transferor has delivered to Trustee an Officer's Certificate to the effect that, based on the facts known to such officer at the time, Transferor reasonably believes that such increase, reduction or elimination will not at the time of its occurrence cause an Early Amortization Event, or an event which with notice or the lapse of time would constitute an Early Amortization Event, to occur with respect to any Series and (ii) in the case of any increase, the Discount Percentage shall not exceed 3% after giving effect to that increase, unless the Rating Agency Condition has been satisfied with respect to the increase.
(b) On each Date of Processing after the date on which the Transferor's exercise of its discount option takes effect, the Transferor shall treat Discount Option Receivables Collections as Collections of Finance Charge Receivables.
SECTION 2.11. ADDITIONAL TRANSFERORS. Transferor may designate additional or substitute Persons to be included as Transferors under this Agreement by an amendment to this Agreement (which amendment shall be subject to SECTION 13.1 and to any applicable restrictions in the Supplement for any outstanding Series) and, in connection with such designation, the initial Transferor shall transfer a portion of the Transferor Interest to such additional Transferor reflecting such additional Transferor's interest in the Transferor Interest; PROVIDED THAT prior to any such designation and issuance the conditions set forth in SECTION 6.3(d) shall have been satisfied.
SECTION 2.12. ADDITIONAL CREDIT CARD ORIGINATORS. Transferor may designate additional Persons as Credit Card Originators under this Agreement by an amendment to this Agreement (which amendment shall be subject to SECTION 13.1 and to any applicable restrictions in the Supplement for any outstanding Series).
ARTICLE III ADMINISTRATION AND SERVICING
SECTION 3.1. ACCEPTANCE OF APPOINTMENT AND OTHER MATTERS RELATING TO SERVICER. (a) WFN is appointed, and agrees to act, as Servicer.
(b) Servicer shall service and administer the Receivables, shall collect payments due under the Receivables and shall charge off as uncollectible Receivables, all in accordance with its customary and usual servicing procedures for servicing credit card and other consumer open end credit receivables comparable to the Receivables and in accordance with the Credit Card Guidelines. 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, subject to SECTION 10.1 and provided WFN is Servicer, Servicer or its designee
(rather than Trustee) is hereby authorized and empowered (i) to make withdrawals and payments or to instruct Trustee to make withdrawals and payments from the Collection Account and any Series Account, as set forth in this Agreement or any Supplement, and (ii) to take any action required or permitted under any Enhancement, as set forth in this Agreement or any Supplement. Without limiting the generality of the foregoing and subject to SECTION 10.1, Servicer or its designee is authorized and empowered to make any filings, reports, notices, applications and registrations with, and to seek any consents or authorizations from, 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 laws or reporting requirements. Trustee shall furnish Servicer with any powers of attorney or other documents necessary or appropriate to enable Servicer to carry out its servicing and administrative duties hereunder.
(c) Servicer shall not be obligated to use separate servicing procedures, offices, employees or accounts for servicing the Receivables from the procedures, offices, employees and accounts used by Servicer in connection with servicing other credit card receivables.
(d) Servicer shall comply with and perform its servicing obligations with respect to the Accounts and Receivables in accordance with the Credit Card Agreements relating to the Accounts and the Credit Card Guidelines except insofar as any failure to so comply or perform would not materially and adversely affect the Trust or the Investor Holders.
(e) Servicer shall be liable for the payment, without reimbursement, of
all expenses incurred in connection with the Trust and the servicing activities
hereunder including expenses related to enforcement of the Receivables, fees and
disbursements of Trustee, any Paying Agent and any Transfer Agent and Registrar
(including the reasonable fees and expenses of its counsel) in accordance with
SECTION 11.5, fees and disbursements of independent accountants and all other
fees and expenses, including the costs of filing UCC continuation statements and
the costs and expenses relating to obtaining and maintaining the listing of any
Investor Certificates on any stock exchange, that are not expressly stated in
this Agreement to be payable by the Trust, the Investor Holders of a Series or
Transferor (other than Federal, state, local and foreign income, franchise and
other taxes, if any, or any interest or penalties with respect thereto, assessed
on the Trust).
(f) Servicer shall maintain fidelity bond or other appropriate insurance coverage insuring against losses through wrongdoing of its officers and employees who are involved in the servicing of credit card receivables covering such actions and in such amounts as Servicer believes to be reasonable from time to time.
SECTION 3.2. SERVICING COMPENSATION. As full compensation for its servicing activities hereunder and as reimbursement for any expense incurred by it in connection therewith, Servicer shall be entitled to receive a servicing fee (the "SERVICING FEE") with respect to each Monthly Period, payable monthly on the related Distribution Date, in an amount equal to one-twelfth of the product of (a) the weighted average of the Series Servicing Fee Percentages with respect to each outstanding Series (based upon the Series Servicing Fee Percentage for each Series and the Invested Amount (or such other amount as specified in the related Supplement) of such Series, in each case as of the last day of the prior Monthly Period) and (b) the amount of Principal Receivables on the last day of the prior Monthly Period. The share of the Servicing Fee allocable
to the Investor Interest of each Series with respect to any Monthly Period (the "INVESTOR SERVICING FEE") will be determined in accordance with the relevant Supplement. The portion of the Servicing Fee with respect to any Monthly Period not so allocated to the Investor Interest of a particular Series, or otherwise allocated in any Supplement, shall be paid from Finance Charge Collections allocable to Transferor on the related Distribution Date. In no event shall the Trust, Trustee, the Investor Holders of any Series or any Enhancement Provider be liable for the share of the Servicing Fee with respect to any Monthly Period to be paid by Transferor.
SECTION 3.3. REPRESENTATIONS, WARRANTIES AND COVENANTS OF SERVICER. WFN, in its capacity as initial Servicer, hereby makes, and any Successor Servicer by its appointment hereunder shall make, on each Closing Date (and on the date of any such appointment), the following representations, warranties and covenants to the Trust:
(a) ORGANIZATION AND GOOD STANDING. Servicer is a national banking association (or with respect to such Successor Servicer, such other corporate entity as may be applicable) duly organized, validly existing and in good standing under the laws of the United States, and has full corporate power, authority and legal right to execute, deliver and perform its obligations under this Agreement and each Supplement and, in all material respects, to own its properties and conduct its business as such properties are presently owned and as such business is presently conducted.
(b) DUE QUALIFICATION. Servicer is duly qualified to do business and is in good standing as a foreign corporation (or is exempt from such requirements), and has obtained all necessary licenses and approvals in each jurisdiction in which failure to so qualify or to obtain such licenses and approvals would have a material adverse effect on the interests of the Investor Holders hereunder or under any Supplement.
(c) DUE AUTHORIZATION. The execution, delivery, and performance of this Agreement and each Supplement have been duly authorized by Servicer by all necessary corporate action on the part of Servicer.
(d) BINDING OBLIGATION. This Agreement and each Supplement constitutes a legal, valid and binding obligation of Servicer, enforceable in accordance with its terms, except as enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereinafter in effect, affecting the enforcement of creditors' rights in general (or with respect to such Successor Servicer, such other corporate entity as may be applicable) and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity).
(e) NO VIOLATION. The execution and delivery of this Agreement and each Supplement by Servicer, the performance of the transactions contemplated by this Agreement and each Supplement and the fulfillment of the terms hereof and thereof applicable to Servicer, will not conflict with, violate, result in any breach of any of the material terms and provisions of, or constitute (with or without notice or lapse of time or both) a material default under, any Requirement of Law applicable to Servicer or any indenture, contract, agreement, mortgage, deed of trust or other instrument to which Servicer is a party or by which it or any of its properties are bound.
(f) NO PROCEEDINGS. There are no proceedings or investigations pending or, to the best knowledge of Servicer, threatened against Servicer before any court, regulatory body, administrative agency or other tribunal or governmental instrumentality seeking to prevent the issuance of the Certificates or the consummation of any of the transactions contemplated by this Agreement or any Supplement, seeking any determination or ruling that, in the reasonable judgment of Servicer, would materially and adversely affect the performance by Servicer of its obligations under this Agreement or any Supplement, or seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Agreement or any Supplement.
(g) COMPLIANCE WITH REQUIREMENTS OF LAW. Servicer shall duly satisfy all obligations on its part to be fulfilled under or in connection with the Receivables and the related Accounts, will maintain in effect all qualifications required under Requirements of Law in order to properly service the Receivables and the related Accounts and will comply in all material respects with all other Requirements of Law in connection with servicing the Receivables and the related Accounts, the failure to comply with which would have a material adverse effect on the interests of the Investor Holders.
(h) NO RESCISSION OR CANCELLATION. Servicer shall not permit any rescission or cancellation of a Receivable except as ordered by a court of competent jurisdiction or other Governmental Authority or in the ordinary course of its business and in accordance with the Credit Card Guidelines. Servicer shall reflect any such rescission or cancellation in its computer file of revolving credit card accounts. In addition, Servicer may waive the accrual and/or payment of certain Finance Charge Receivables in respect of certain past due Accounts, the Obligors of which have enrolled with a consumer credit counseling service, and the Receivables in such Accounts shall not fail to be Eligible Receivables solely as a result of such waiver.
(i) PROTECTION OF HOLDERS' RIGHTS. Servicer shall take no action which, nor omit to take any action the omission of which, would materially impair the rights of Holders in any Receivable or Account, nor shall it, except in the ordinary course of its business and in accordance with the Credit Card Guidelines, reschedule, revise or defer Collections due on the Receivables.
(j) RECEIVABLES NOT TO BE EVIDENCED BY PROMISSORY NOTES. Except in connection with its enforcement or collection of an Account, Servicer will take no action to cause any Receivable to be evidenced by any instrument, other than an instrument that, taken together with one or more other writings, constitutes chattel paper and, if any Receivable is so evidenced (whether or not in connection with the enforcement or collection of an Account), it shall be reassigned or assigned to Servicer as provided in this Section.
(k) ALL CONSENTS REQUIRED. All approvals, authorizations, consents, orders or other actions of any Person or of any governmental body or official required in connection with the execution and delivery by Servicer of this Agreement and each Supplement, the performance by Servicer of the transactions contemplated by this Agreement and each Supplement and the fulfillment by Servicer of the terms hereof and thereof, have been obtained; PROVIDED that Servicer makes no representation or warranty as to state securities or "blue sky" laws.
(l) MAINTENANCE OF RECORDS AND BOOKS OF ACCOUNT. Servicer shall maintain and implement administrative and operating procedures (including the ability to recreate records evidencing the Receivables in the event of the destruction of the originals thereof), and keep and maintain all documents, books, computer records and other information, reasonably necessary or advisable for the collection of all the Receivables. Such documents, books and computer records shall reflect all facts giving rise to the Receivables, all payments and credits with respect thereto, and, to the extent required pursuant to SECTION 2.1, such documents, books and computer records shall indicate the interests of the Trust in the Receivables.
For purposes of the representations and warranties set forth in this
SECTION 3.3, each reference to a Supplement shall be deemed to refer only to
those Supplements in effect as of the relevant Closing Date or the date of
appointment of a Successor Servicer, as applicable.
If any of the representations, warranties or covenants of Servicer contained in PARAGRAPH (g), (h), (i) or (j) with respect to any Receivable or the related Account is breached, and as a result of such breach the Trust's rights in, to or under any Receivables in the related Account or the proceeds of such Receivables are materially impaired or such proceeds are not available for any reason to the Trust free and clear of any Lien, then no later than the expiration of 60 days (or such longer period, not in excess of 150 days, as may be agreed to by Trustee) from the earlier to occur of the discovery of such event by Servicer, or receipt by Servicer of notice of such event given by Trustee, all Receivables in the Account or Accounts to which such event relates shall be reassigned or assigned to Servicer as set forth below; PROVIDED that such Receivables will not be reassigned or assigned to Servicer if, on any day prior to the end of such 60-day or longer period, (i) the relevant representation and warranty shall be true and correct, or the relevant covenant shall have been complied with, in all material respects and (ii) Servicer shall have delivered an Officer's Certificate describing the nature of such breach and the manner in which such breach was cured.
Servicer shall effect such assignment by making a deposit into the Collection Account in immediately available funds prior to the next succeeding Business Day in an amount equal to the amount of such Receivables, which deposit shall be considered a Collection with respect to such Receivables and shall be applied in accordance with ARTICLE IV and each Supplement.
Upon each such assignment to Servicer, Trustee, on behalf of the Trust, shall automatically and without further action be deemed to transfer, assign, set over and otherwise convey to Servicer, without recourse, representation or warranty (except for the warranty that since the date of transfer by Transferor, Trustee has not sold, transferred or encumbered any such Receivables or interest therein), all right, title and interest of the Trust in and to such Receivables, all moneys due or to become due and all amounts received with respect thereto and all proceeds thereof. Trustee shall execute such documents and instruments of transfer or assignment and take such other actions as shall be reasonably requested by Servicer to effect the conveyance of any such Receivables pursuant to this Section. The obligation of Servicer to accept assignment of such Receivables, and to make the deposits, if any, required to be made to the Excess Funding Account or the Collection Account as provided in the preceding paragraph, shall constitute the sole remedy respecting the event giving rise to such obligation available to Holders (or Trustee on behalf of Holders) or any Enhancement Provider.
SECTION 3.4. REPORTS TO TRUSTEE.
(a) DAILY REPORTS. On the second Business Day immediately following each Date of Processing, Servicer shall prepare and make available at the office of Servicer for inspection by Trustee a report (the "DAILY REPORT") that shall set forth (i) the aggregate amounts of Collections, Collections with respect to Principal Receivables and Collections with respect to Finance Charge Receivables processed by Servicer on such Date of Processing, (ii) the aggregate amount of Defaulted Receivables for such Date of Processing, and (iii) the aggregate amount of Principal Receivables in the Trust as of such Date of Processing.
(b) MONTHLY SERVICER'S CERTIFICATE. Unless otherwise stated in any
Supplement as to the related Series, on each Determination Date, Servicer shall
forward to Trustee, the Paying Agent, each Rating Agency and each Enhancement
Provider, if any, a certificate of a Servicing Officer setting forth (i) the
aggregate amounts for the preceding Monthly Period with respect to each of the
items specified in CLAUSE (i) of SECTION 3.4(a), (ii) the aggregate Defaulted
Receivables and Recoveries for the preceding Monthly Period, (iii) a calculation
of the Portfolio Yield and Base Rate for each Series then outstanding, (iv) the
aggregate amount of Receivables and the balance on deposit in the Collection
Account (or any subaccount thereof) or any Series Account applicable to any
Series then outstanding with respect to Collections processed as of the end of
the last day of the preceding Monthly Period, (v) the aggregate amount of
adjustments from the preceding Monthly Period, (vi) the aggregate amount, if
any, of withdrawals, drawings or payments under any Enhancement with respect to
each Series required to be made with respect to the previous Monthly Period,
(vii) the sum of all amounts payable to the Investor Holders on the succeeding
Distribution Date in respect of interest and principal payable with respect to
the Investor Certificates and (viii) such other amounts, calculations, and/or
information as may be required by any relevant Supplement.
(c) TRANSFERRED ACCOUNTS. Servicer covenants and agrees hereby to deliver to Trustee, on or prior to the Automatic Addition Termination Date or any Automatic Addition Suspension Date (but in the latter case, prior to a Restart Date) within a reasonable time period after any Transferred Account is created, but in any event not later than 15 days after the end of the month within which the Transferred Account is created, a notice specifying the new account number for any Transferred Account and the replaced account number.
SECTION 3.5. ANNUAL CERTIFICATE OF SERVICER. Servicer shall deliver to Trustee, each Rating Agency and each Enhancement Provider, if any, entitled thereto pursuant to the relevant Supplement, on or before the 90th day following the end of the Servicer's fiscal year 1996 and each subsequent fiscal year, an Officer's Certificate (with appropriate insertions) substantially in the form of EXHIBIT C.
SECTION 3.6. ANNUAL SERVICING REPORT OF INDEPENDENT PUBLIC ACCOUNTANTS; COPIES OF REPORTS AVAILABLE. (a) On or before the 90th day following the end of the Servicer's fiscal year 1996 and each subsequent fiscal year, Servicer shall cause a firm of nationally recognized independent public accountants (who may also render other services to Servicer, the Credit Card Originator or Transferor) to furnish a report (addressed to Trustee) to Trustee, Servicer and each Rating Agency to the effect that they have applied certain procedures with Servicer and such firm has examined certain documents and records relating to the servicing of Accounts under this
Agreement and each Supplement, compared the information contained in Servicer's certificates delivered pursuant to this Agreement during the period covered by such report with such documents and records and that, on the basis of such agreed upon procedures (and assuming the accuracy of any reports generated by Servicer's third party agents), such servicing was conducted in compliance with this Agreement during the period covered by such report (which shall be the prior calendar year, or the portion thereof falling after the Initial Closing Date), except for such exceptions, errors or irregularities as such firm shall believe to be immaterial and such other exceptions, errors or irregularities as shall be set forth in such report. Such report shall set forth the agreed upon procedures performed. A copy of such report shall be delivered to each Enhancement Provider, if any, entitled thereto pursuant to the relevant Supplement.
(b) On or before the 90th day following the end of the Servicer's fiscal year 1996 and each subsequent fiscal year, Servicer shall cause a firm of nationally recognized independent public accountants (who may also render other services to Servicer, the Credit Card Originator or Transferor) to furnish a report to Trustee, Servicer and each Rating Agency to the effect that they have applied certain procedures agreed upon with Servicer to compare the mathematical calculations of certain amounts set forth in Servicer's Certificates delivered pursuant to SECTION 3.4(c) during the period covered by such report with Servicer's computer reports which were the source of such amounts and that on the basis of such agreed upon procedures and comparison, such amounts are in agreement, except for such exceptions as they believe to be immaterial and such other exceptions as shall be set forth in such statement. A copy of such report shall be delivered to each Enhancement Provider, if any, entitled thereto pursuant to the relevant Supplement.
(c) A copy of each certificate and report provided pursuant to SECTION 3.4(c), 3.5 or 3.6 may be obtained by any Investor Holder or Certificate Owner by a request to Trustee addressed to the Corporate Trust Office.
(d) In the event such firm rendering a report under this Section 3.6 requires the Trustee to agree to the procedures performed by such firm, the Servicer shall direct the Trustee in writing to so agree; it being understood and agreed that the Trustee will deliver such letter of agreement in conclusive reliance upon the direction of the Servicer, and the Trustee makes no independent inquiry or investigation as to, and shall have no obligation or liability in respect of, the sufficiency, validity or correctness of such procedures.
SECTION 3.7. TAX TREATMENT. Transferor has entered into this Agreement, and the Certificates will be issued, with the intention that for Federal, state and local income and franchise tax purposes, the Investor Certificates (except Transferor Retained Certificates which are held by Transferor) of each Series will qualify as debt secured by the Receivables. Transferor, by entering into this Agreement, each Holder, by the acceptance of its Certificate (and each Certificate Owner, by its acceptance of an interest in the applicable Certificate), agree to treat such Investor Certificates for Federal, state and local income and franchise tax purposes as debt. Each Holder of such Investor Certificate agrees that it will cause any Certificate owner acquiring an interest in a Certificate through it to comply with this Agreement as to treatment as debt under applicable tax law, as described in this SECTION 3.7. Furthermore, subject to SECTION 11.11, or unless Transferor shall determine that the filing of returns is appropriate, Trustee shall
treat the Trust solely as a security device and not as an entity separate from the Transferor and shall not file tax returns or obtain an employer identification number on behalf of the Trust.
SECTION 3.8. NOTICES TO TRANSFEROR. If WFN is no longer acting as Servicer, any Successor Servicer shall deliver to Transferor each certificate and report required to be provided thereafter pursuant to SECTION 3.4(c), 3.5 or 3.6.
SECTION 3.9. ADJUSTMENTS. (a) If Servicer adjusts downward the amount of any Receivable because of a rebate, refund, unauthorized charge or billing error to an accountholder, or because such Receivable was created in respect of merchandise which was refused or returned by an accountholder, or if Servicer otherwise adjusts downward the amount of any Receivable without receiving Collections therefor or charging off such amount as uncollectible ("MERCHANT ADJUSTMENT PAYMENTS"), then, in any such case, the amount of Principal Receivables used to calculate the Transferor Interest or the Investor Percentages applicable to any Series will be reduced by the amount of the adjustment. Similarly, the amount of Principal Receivables used to calculate the Transferor Amount and the Investor Percentages applicable to any Series will be reduced by the amount of any Principal Receivable which was discovered as having been created through a fraudulent or counterfeit charge or with respect to which the covenant of Transferor contained in SECTION 2.7(b) has been breached. Any adjustment required pursuant to either of the two preceding sentences shall be made on the first Business Day after the Date of Processing for the event giving rise to such adjustment. If, following the exclusion of such Principal Receivables from the calculation of the Transferor Amount, the Transferor Amount would be less than the Specified Transferor Amount, not later than the close of business on such first Business Day, Transferor shall make a deposit into the Excess Funding Account in immediately available funds in an amount equal to the amount by which the Transferor Amount would be less than the Specified Transferor Amount (up to the amount of such Principal Receivables). Any amount deposited into the Excess Funding Account pursuant to the preceding sentence shall be considered Collections of Principal Receivables and shall be applied in accordance with ARTICLE IV and each Supplement.
(b) If (i) Servicer makes a deposit into the Collection Account in respect of a Collection of a Receivable and such Collection was received by Servicer in the form of a check which is not honored for any reason or (ii) 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, Servicer shall appropriately adjust the amount subsequently deposited into the Collection Account to reflect such dishonored check or mistake. Any Receivable in respect of which a dishonored check is received shall be deemed not to have been paid. Notwithstanding the first two sentences of this paragraph, any adjustments made pursuant to this paragraph will be reflected in a current report but will not change any amount of Collections previously reported pursuant to SECTION 3.4(c).
ARTICLE IV RIGHTS OF HOLDERS; ALLOCATIONS
SECTION 4.1. RIGHTS OF HOLDERS. 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 Holders of such Series pursuant to this Agreement and such Supplement, funds on deposit in the Collection Account allocable to Holders 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 Enhancement (the "INVESTOR INTEREST"), it being understood that, unless otherwise specified in the Supplements with respect to each affected Series, the Investor Certificates of any Series or Class shall not represent any interest in any Series Account or Enhancement for the benefit of any other Series or Class. The Transferor shall own the remaining interest in the Trust Assets not allocated pursuant to this Agreement or any Supplement to the Investor Interest (the "TRANSFEROR INTEREST"), including the right to receive Collections with respect to the Receivables and other amounts at the times and in the amounts specified in this Agreement or any Supplement to be paid on account of the Transferor Interest; PROVIDED that (x) the Transferor Interest shall not represent any interest in the Collection Account, any Series Account or any Enhancement, except as specifically provided in this Agreement or any Supplement and (y) if this Agreement or, in the case of Supplemental Accounts, the related Assignment is deemed to constitute a grant to the Trustee, for the benefit of the Investor Holders, of a security interest in the Receivables and other Trust Assets, then the Transferor Interest shall be deemed to represent Transferor's equity in the collateral granted.
SECTION 4.2. ESTABLISHMENT OF COLLECTION ACCOUNT AND EXCESS FUNDING ACCOUNT. Servicer, for the benefit of the Holders, shall establish and maintain in the name of Trustee, on behalf of the Trust, two Eligible Deposit Accounts (the "COLLECTION ACCOUNT" and the "EXCESS FUNDING ACCOUNT"), each bearing a designation clearly indicating that the funds deposited therein are held for the benefit of the Holders. The Collection Account and the Excess Funding Account shall initially be established with Trustee. Trustee shall possess all right, title and interest in all funds on deposit from time to time in the Collection Account and the Excess Funding Account and in all proceeds thereof for the benefit of the Holders. The Collection Account and the Excess Funding Account shall be under the sole dominion and control of Trustee for the benefit of the Holders. Except as expressly provided in this Agreement, Trustee agrees that it shall have no right of set-off or banker's lien against, and no right to otherwise deduct from, any funds held in the Collection Account or the Excess Funding Account for any amount owed to it by the Trust, any Holder or any Enhancement Provider. If at any time the Collection Account or the Excess Funding Account ceases to be an Eligible Deposit Account, Trustee (or Servicer on its behalf) shall within 10 Business Days (or such longer period, not to exceed 30 calendar days, as to which the Rating Agency Condition is satisfied) establish a new Eligible Deposit Account meeting the conditions specified above and transfer any cash or any investments from the affected account to such new account, and from the date such new account is established, it shall be the "Collection Account" or the "Excess Funding Account," as the case may be.
Funds on deposit in the Collection Account and the Excess Funding Account shall, at the direction of Servicer, be invested by Trustee in Eligible Investments selected by Servicer, except that funds on deposit in either such account on any Transfer Date need not be invested through the immediately following Distribution Date. All such Eligible Investments shall be held by Trustee for the benefit of the Holders. Trustee shall maintain for the benefit of the Holders possession of the negotiable instruments or securities, if any, evidencing such Eligible Investments. Investments of funds representing Collections collected during any Monthly Period shall be invested in Eligible Investments that will mature so that all funds will be available at the
close of business on the Transfer Date following such Monthly Period. No Eligible Investment shall be disposed of prior to its maturity unless Servicer so directs and either (i) such disposal will not result in a loss of all or part of the principal portion of such Eligible Investment or (ii) prior to the maturity of such Eligible Investment, a default occurs in the payment of principal, interest or any other amount with respect to such Eligible Investment. On each Distribution Date, all interest and other investment earnings (net of losses and investment expenses) on funds on deposit in the Collection Account and the Excess Funding Account shall be treated as Collections of Finance Charge Receivables with respect to the last day of the related Monthly Period, except as otherwise specified in any Supplement. For purposes of determining the availability of funds or the balances in the Collection Account or the Excess Funding Account for any reason under this Agreement, all investment earnings net of investment expenses and losses on such funds shall be deemed not to be available or on deposit. In no event shall the Trustee be liable for the selection of investments or for investment losses incurred thereon. The Trustee shall have no liability in respect of losses incurred as a result of the liquidation of any such investment prior to its stated maturity or the failure of the party directing such investment to provide timely written investment direction. The Trustee shall have no obligation to invest or reinvest any amounts held hereunder in the absence of such written investment direction.
Unless otherwise directed by Servicer, funds on deposit in the Excess Funding Account will be withdrawn and paid to Transferor on any day to the extent that the Transferor Amount exceeds the Specified Transferor Amount on such day. On any Transfer Date on which one or more Series is in an Amortization Period, Servicer shall determine the aggregate amounts of Principal Shortfalls, if any, with respect to each such Series that is a Principal Sharing Series (after giving effect to the allocation and payment provisions in the Supplement with respect to each such Series), and Servicer shall instruct Trustee to withdraw such amount from the Excess Funding Account (up to an amount equal to the lesser of (x) the amount on deposit in the Excess Funding Account after application of the preceding sentence on that day and (y) the amount, if any, by which the Transferor Amount would be less than zero if there were no funds on deposit in the Excess Funding Account on that day) on such Transfer Date and allocate such amount among each such Series as specified in each related Supplement.
SECTION 4.3. COLLECTIONS AND ALLOCATIONS. (a) Servicer shall apply, or instruct Trustee to apply, all funds on deposit in the Collection Account as described in this ARTICLE IV and in each Supplement. Except as otherwise provided below and in each Supplement, Servicer shall deposit Collections into the Collection Account no later than the second Business Day following the Date of Processing of such Collections. Except as otherwise required by any Supplement, Transferor may permit or require payments owed by any Merchant with respect to In-Store Payments to be netted against amounts owed by the Credit Card Originator to that Merchant, and Transferor shall require the Credit Card Originator to deposit into the Collection Account on each Business Day an amount equal to the aggregate amount of In-Store Payments netted against amounts owed by the Credit Card Originator to the various Merchants on that Business Day.
Subject to the express terms of any Supplement, but notwithstanding anything else in this Agreement to the contrary, if WFN remains Servicer and (x) for so long as WFN maintains a short term debt rating of A-1 or better by S&P, P-1 or better by Moody's, if rated by Fitch, F1 or better by Fitch, and, if rated by any other Rating Agency, the equivalent rating by that Rating Agency (or such other rating below A-1, P-1 or such equivalent rating, as the case may be, which
is satisfactory to each Rating Agency, if any), (y) with respect to Collections allocable to any Series, any other conditions specified in the related Supplement are satisfied or (z) WFN has provided to Trustee a letter of credit, surety bond or other similar arrangement covering collection risk of Servicer and in each case acceptable to each Rating Agency (as evidenced by a letter from each Rating Agency to the effect that the Rating Agency Condition has been satisfied), if any, Servicer need not make the daily deposits of Collections into the Collection Account as provided in the preceding paragraph, but may make a single deposit in the Collection Account in immediately available funds not later than 12:00 noon, New York City time, on the related Transfer Date.
(b) On each Date of Processing, Collections of Finance Charge Receivables and of Principal Receivables shall be allocated to the Investor Interest of each Series in accordance with the related Supplement. On each Determination Date, Defaulted Receivables will be allocated to the Investor Interest of each Series in accordance with the related Supplement.
(c) Throughout the existence of the Trust, unless otherwise stated in any Supplement, on each Date of Processing Servicer shall allocate to Transferor an amount equal to the product of (A) the Transferor Percentage and (B) the aggregate amount of Collections allocated to Principal Receivables and Finance Charge Receivables, respectively, on that Date of Processing; PROVIDED that, if the Transferor Amount (determined after giving effect to any transfer of Principal Receivables to the Trust on such date), is less than or equal to the Specified Transferor Amount, Servicer shall not allocate to Transferor any such amounts that otherwise would be allocated to Transferor, but shall instead deposit such funds in the Excess Funding Account. Unless otherwise stated in any Supplement, neither Servicer nor Transferor need deposit any amounts allocated to the Transferor pursuant to the foregoing into the Collection Account and shall pay, or be deemed to pay, such amounts as collected to Transferor.
The payments to be made to Transferor, pursuant to this SECTION 4.3(c) do not apply to deposits to the Collection Account or other amounts that do not represent Collections, including payment of the purchase price for Receivables pursuant to SECTION 2.6 or 10.1, proceeds from the sale, disposition or liquidation of Receivables pursuant to SECTION 9.2 or 12.2 or payment of the purchase price for the Investor Interest of a specific Series pursuant to the related Supplement.
SECTION 4.4. SHARED PRINCIPAL COLLECTIONS. On each Business Day, Shared Principal Collections may, at the option of Transferor, be applied (or held in the Collection Account for later application) as principal with respect to any Variable Interest or, so long as either no Series is in an Amortization Period or no Series that is in an Amortization Period will have a Principal Shortfall on the related Transfer Date (assuming no Early Amortization Event occurs), withdrawn from the Collection Account and paid to Transferor; and on each Transfer Date, (a) Servicer shall allocate Shared Principal Collections not previously so applied or paid to each applicable Principal Sharing Series, pro rata, in proportion to the Principal Shortfalls, if any, with respect to each such Series, and any remainder may, at the option of Transferor, be applied as principal with respect to any Variable Interest and (b) Servicer shall withdraw from the Collection Account and pay to Transferor any amounts representing Shared Principal Collections remaining after the allocations and applications referred to in CLAUSE (a); PROVIDED that, if, on any day the Transferor Amount (determined after giving effect to any transfer of Principal Receivables to the Trust on such day), is less than or equal to the Specified Transferor Amount,
Servicer shall not distribute to Transferor any Shared Principal Collections that otherwise would be distributed to Transferor, but shall deposit such funds in the Excess Funding Account to the extent required so that the Transferor Amount equals the Specified Transferor Amount. Notwithstanding the foregoing, during any Amortization Period for any Series (other than a Variable Interest), Transferor may not apply Shared Principal Collections as principal with respect to any Variable Interest, unless such application of principal is made on any Transfer Date or related Distribution Date after the application of Shared Principal Collections pursuant to the various Supplements.
SECTION 4.5. EXCESS FINANCE CHARGE COLLECTIONS. On each Transfer Date, (a) for each Group, Servicer shall allocate the aggregate amount for all outstanding Series in such Group of the amounts which the related Supplements specify are to be treated as "Excess Finance Charge Collections" for such Transfer Date to each Series in such Group, pro rata, in proportion to the Finance Charge Shortfalls, if any, with respect to each such Series, and (b) Servicer shall on the related Distribution Date withdraw (or shall instruct Trustee in writing to withdraw) from the Collection Account and pay to Transferor an amount equal to the excess, if any, of (x) the aggregate amount for all outstanding Series in a Group of the amounts which the related Supplements specify are to be treated as "Excess Finance Charge Collections" for such Distribution Date over (y) the aggregate amount for all outstanding Series in such Group which the related Supplements specify are "Finance Charge Shortfalls", for such Distribution Date.
THE REMAINDER OF ARTICLE IV IS RESERVED AND SHALL BE SPECIFIED IN ANY
SUPPLEMENT WITH RESPECT TO ANY SERIES
ARTICLE V DISTRIBUTIONS AND REPORTS
DISTRIBUTIONS SHALL BE MADE TO, AND REPORTS SHALL BE PROVIDED TO, HOLDERS
AS SET FORTH IN THE APPLICABLE SUPPLEMENT.
ARTICLE VI THE CERTIFICATES
SECTION 6.1. THE CERTIFICATES. The Investor Certificates of any Series or Class may be issued in bearer form ("BEARER CERTIFICATES") with attached interest coupons and any other applicable coupon (collectively, the "COUPONS") or in fully registered form ("REGISTERED CERTIFICATES") and shall be substantially in the form of the exhibits with respect thereto attached to the applicable Supplement. Except as otherwise provided in SECTION 6.3 or in any Supplement, Bearer Certificates shall be issued in minimum denominations of $5,000 and Registered Certificates shall be issued in minimum denominations of $1,000 and in integral multiples of $1,000 in excess thereof. If specified in any Supplement, the Investor Certificates of any Series or Class shall be issued upon initial issuance as a single certificate evidencing the aggregate original principal amount of such Series or Class as described in SECTION 6.13. Each Certificate shall be executed by manual or facsimile signature on behalf of Transferor by its President, Treasurer or any Vice President. Certificates bearing the manual or facsimile signature of an individual who was, at the time when such signature was affixed, authorized to sign on behalf of 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 Trustee by the manual or facsimile signature of a duly authorized signatory, and such certificate of authentication upon any Certificate shall be conclusive evidence, and the only evidence, that such Certificate has been duly authenticated and delivered hereunder. Bearer Certificates shall be dated the applicable Closing Date. All Registered Certificates shall be dated the date of their authentication.
SECTION 6.2. AUTHENTICATION OF CERTIFICATES. 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 Transferor against payment to Transferor of the purchase price therefor. If specified in the related Supplement for any Series or Class, Trustee shall authenticate and deliver outside the United States the Global Certificate that is issued upon original issuance thereof.
SECTION 6.3. NEW ISSUANCES. (a) Transferor may from time to time direct Trustee, on behalf of the Trust, to authenticate one or more new Series of Investor Certificates. The Investor Certificates of all outstanding Series shall be equally and ratably entitled as provided herein to the benefits of this Agreement without preference, priority or distinction, all in accordance with the terms and provisions of this Agreement and the applicable Supplement except, with respect to any Series or Class, as provided in the related Supplement.
(b) On or before the Closing Date for any new Series, the parties hereto will execute and deliver a Supplement specifying the Principal Terms of the new Series. Such Supplement may modify or amend the terms of this Agreement solely as applied to the new Series and may grant the Holders of the Investor Certificates in that Series, or an agent or other representative of such Holders, notice and consultation rights with respect to any rights or actions of Trustee. Trustee's obligation to authenticate the Investor Certificates of a new Series and to execute and deliver the related Supplement is subject to the satisfaction of the following conditions (except that the conditions set forth in CLAUSES (i), (iii), (iv) and (v) shall not be applicable to the issuance of the first Series):
(i) on or before the fifth Business Day immediately preceding the Closing Date, Transferor shall have given Trustee, Servicer, each Rating Agency and any Enhancement Provider entitled thereto pursuant to the relevant Supplement notice of such issuance and the Closing Date;
(ii) Transferor shall have delivered to Trustee the related Supplement, executed by each party hereto other than Trustee;
(iii) Transferor shall have delivered to Trustee any related Enhancement Agreement executed by each of the parties thereto, other than Trustee;
(iv) the Rating Agency Condition shall have been satisfied with respect to such issuance;
(v) Transferor shall have delivered to Trustee and any Enhancement Provider entitled thereto pursuant to the relevant Supplement an Officer's Certificate, dated the
applicable Closing Date, to the effect that Transferor reasonably believes that such issuance will not, based on the facts known to such officer at the time of such certification, then or thereafter cause an Early Amortization Event to occur with respect to any Series;
(vi) Transferor shall have delivered to Trustee and each Rating Agency a Tax Opinion, dated the Closing Date, with respect to such issuance; and
(vii) Transferor shall have delivered to Trustee an Officer's Certificate stating that (A) the Transferor Amount shall not be less than the Minimum Transferor Amount and (B) the aggregate Principal Receivables plus the Excess Funding Account balance shall not be less than the Required Principal Balance, in each case as of the Closing Date and after giving effect to such issuance.
Upon satisfaction of the above conditions, Trustee shall execute the Supplement and authenticate the Investor Certificates of such Series upon execution thereof by Transferor.
(c) Transferor may from time to time transfer a portion of the Transferor Interest by causing the issuance of one or more additional interests (each a "SUPPLEMENTAL INTEREST"), which may be in certificated or uncertificated form. The form and terms of any Supplemental Interest shall be defined in a Supplement (which Supplement shall be subject to SECTION 13.1(a) to the extent that it amends any of the terms of this Agreement), to be delivered to or upon the order of Transferor (or the Holder of a Supplemental Interest, in the case of the transfer or exchange thereof, as provided below), upon satisfaction of the following conditions:
(i) the Rating Agency Condition shall have been satisfied with respect to such action; and
(ii) Transferor shall have delivered to Trustee and each Rating Agency a Tax Opinion, dated the date of such action (or transfer, exchange or other disposition as provided below), with respect thereto and an Opinion of Counsel to the effect that such action, assignment, participation, pledge or other disposition does not require registration of the interest under the Securities Act or any state securities law except for any such registration that has been duly completed and become effective.
Any Supplemental Interest may be transferred or exchanged, and the Transferor Interest may be pledged, only upon satisfaction of the conditions set forth in CLAUSE (ii).
(d) The Transferor Interest may be transferred in its entirety to a Person which is a member of the "affiliated group" as defined in Section 1504(a) of the Code which WFN is a member without the consent or approval of the Holders of the Investor Certificates, provided that (i) the Rating Agency Condition shall have been satisfied with respect to such transfer, (ii) Transferor shall have delivered to Trustee and each Rating Agency Opinions of Counsel of the type described in SECTION 6.3(c)(ii), dated the date of such transfer, with respect thereto and (iii) Transferor shall have delivered to Trustee an Officer's Certificate stating that the Transferor Amount shall not be less than the Minimum Transferor Amount. In connection with any such transfer, the Person to whom the Transferor Interest is transferred will, by its acquisition and
holding of its interest in the Transferor Interest, assume all of the rights and obligations of Transferor as described in this Agreement and in any Supplement or amendment thereto (including the right under this PARAGRAPH (d) with respect to subsequent transfers the Transferor Interest).
SECTION 6.4. REGISTRATION OF TRANSFER AND EXCHANGE OF CERTIFICATES. (a) Trustee shall cause to be kept at the office or agency to be maintained in accordance with the provisions of SECTION 11.16 a register (the "CERTIFICATE REGISTER") in which, subject to such reasonable regulations as it may prescribe, a transfer agent and registrar (which may be 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 on the Effective Date shall be BNY Midwest Trust Company and any co-transfer agent and co-registrar chosen by Transferor and acceptable to 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. So long as any Investor Certificates are outstanding, Transferor shall maintain a Transfer Agent and Registrar in New York City. Any reference in this Agreement to the Transfer Agent and Registrar shall include any co-transfer agent and co-registrar unless the context requires otherwise.
Trustee may revoke such appointment and remove any Transfer Agent and Registrar if Trustee determines in its sole discretion that such Transfer Agent and Registrar failed to perform its obligations under this Agreement in any material respect. Any Transfer Agent and Registrar shall be permitted to resign as Transfer Agent and Registrar upon 30 days' notice to Transferor, Trustee and Servicer; PROVIDED 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 Trustee has appointed a successor Transfer Agent and Registrar reasonably acceptable to Transferor.
Subject to PARAGRAPH (c), upon surrender for registration of transfer of any Registered Certificate at any office or agency of the Transfer Agent and Registrar maintained for such purpose, one or more new Registered Certificates (of the same Series and Class) in authorized denominations of like aggregate fractional undivided interests in the Investor Interest shall be executed, authenticated and delivered, in the name of the designated transferee or transferees.
At the option of a Registered Holder, 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
Investor 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 Investor Interest, upon surrender of the Bearer Certificates to
be exchanged at an office or agency of the Transfer Agent and Registrar located
outside the United States. Each Bearer Certificate surrendered pursuant to this
Section shall have attached thereto all unmatured Coupons; PROVIDED that any
Bearer Certificate, so surrendered after the close of business on the Record
Date preceding the relevant payment date or distribution date
after the expected final payment date need not have attached the Coupon relating to such payment date or distribution date (in each case, as specified in the applicable Supplement).
Whenever any Investor Certificates are so surrendered for exchange, Transferor shall execute, 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 Holder 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 Trustee or the Transfer Agent and Registrar duly executed by the Investor Holder 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 Trustee. 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 Transferor. Such certificate shall also state that a certificate or certificates of a foreign Clearing Agency to the effect required by the applicable Supplement was received with respect to each portion of the Global Certificate exchanged for Definitive Euro-Certificates.
Transferor shall execute and deliver to Trustee Bearer Certificates and Registered Certificates in such amounts and at such times as are necessary to enable Trustee to fulfill its responsibilities under this Agreement, each Supplement and the Certificates.
(b) The Transfer Agent and Registrar will maintain at its expense in the City of New York and 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). If and so long as any Series or Class is listed on the Luxembourg Stock Exchange an agent shall be appointed, at the Servicer's expense, in Luxembourg.
(c) (i) Registration of transfer of Investor Certificates containing (x) a legend substantially to the effect set forth on EXHIBIT D-1 shall be effected only if such transfer is made pursuant to an effective registration statement under the Securities Act or is exempt from the registration requirements under the Securities Act and (y) a legend substantially to the effect set forth on EXHIBIT D-3 shall be effected only if such transfer is made to a Person that is not (1) an employee benefit plan or other plan, trust or account (including an individual retirement account) within the meaning of Section 3.3 of ERISA, whether or not subject to ERISA (including, without limitation, Foreign and governmental plans) or described by Section 4975(e)(1) of the Internal Revenue Code or (2) any collective investment fund, insurance company separate or general account or other entity whose underlying assets include "plan assets" of the foregoing by reason of an employee benefit plan's or other plan's investment in such entity (each, a "BENEFIT PLAN") unless it is an insurance company using the assets of its general account and, at the time
of acquisition and throughout its holding of the certificate (a) it is not a service provider to the trust or an affiliate of the foregoing, and would not otherwise be excluded under 29 C.F.R. 2510.3-101(f)(1), and (b) each of the accounts to which such certificate is allocated is an insurance company general account (1) that is eligible for and meets the requirements of Department of Labor Prohibited Transaction Class Exemption 95-60 and (2) of which less than 25% of the assets are (or represent) assets of a Benefit Plan. If registration of a transfer is to be made in reliance upon an exemption from the registration requirements under the Securities Act, the transferor or the transferee shall deliver, at its expense, to Transferor, Servicer and Trustee, an investment letter from the transferee, substantially in the form of the investment representation letter attached hereto as EXHIBIT D-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 a legend referred to above shall also bear such legend unless Transferor, Servicer, 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 a 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 Servicer regarding such transfer and shall be entitled to receive instructions signed by a Servicing Officer prior to registering any such transfer. Transferor hereby agrees to indemnify the Transfer Agent and Registrar and Trustee and their respective officers, directors, agents and employees 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 paragraph. The preceding sentence shall survive the termination of this Agreement and the earlier removal or resignation of the Trustee.
(ii) Registration of transfer of Investor Certificates containing a legend to the effect set forth on EXHIBIT D-3 shall be effected only if such transfer is made to a Person which is not a Benefit Plan, unless such Person is an insurance company meeting the specific requirements set forth in subsection (i) immediately above. By accepting and holding any such Investor Certificate, an Investor Holder shall be deemed to have represented and warranted that it is not a Benefit Plan, unless such Person is an insurance company meeting the specific requirements set forth in subsection (i) immediately above. 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, unless such Person is an insurance company meeting the specific requirements set forth in subsection (i) immediately above.
(iii) If so requested by Transferor, Trustee will make available to any prospective purchaser of Investor Certificates who so requests, a copy of a letter provided to Trustee by or on behalf of Transferor relating to the transferability of any Series or Class to a Benefit Plan.
(d) Notwithstanding any other provision of this Agreement, any Certificate for which an Opinion of Counsel has not been issued opining on the treatment of such Certificates as debt for
Federal income tax purposes (each, a "SUBJECT CERTIFICATE") shall be subject to
the following. No transfer (or purported transfer) of all or any part of a
Subject Certificate (or any economic interest therein), whether to another
Certificateholder or to a person who is not a Certificateholder, shall be
effective, and any such transfer (or purported transfer) shall be void AB
INITIO, and no Person shall otherwise become a Holder of a Subject Certificate
if (i) at the time of such transfer (or purported transfer) any Subject
Certificates are traded on an established securities market or readily tradable
on a secondary market or the substantial equivalent thereof or (ii) after such
transfer (or purported transfer) (A) the Trust would have more than 95 Holders
of Subject Certificates and any other interests in the Trust for which an
Opinion of Counsel is not rendered in connection with the issuance of such
interest to the effect that such interest will be characterized as debt for
federal income tax purposes and (B) the Subject Certificates have been issued in
a transaction or transactions that were not required to be registered under the
Securities Act, and to the extent such offerings or sales were not required to
be registered under the Securities Act by reason of Regulation S (17 CFR 230.901
through 230.904 or any successor thereto) such offerings or sales would not have
been required to be registered under the Securities Act if the interests so
offered or sold had been offered and sold within the United States. For purposes
of CLAUSE (i) of the preceding sentence, an established securities market is a
national securities exchange that is either registered under Section 6 of the
Exchange Act or exempt from registration because of the limited volume of
transactions, a foreign securities exchange that, under the law of the
jurisdiction where it is organized, satisfies regulatory requirements that are
analogous to the regulatory requirements of the Exchange Act, a regional or
local exchange, or an interdealer quotation system that regularly disseminates
firm buy or sell quotations by identified brokers or dealers by electronic means
or otherwise. For purposes of such CLAUSE (i), Subject Certificates are readily
tradable on a secondary market or the substantial equivalent thereof if (1)
Subject Certificates (or interests therein) are regularly quoted by any person,
such as a broker or dealer, making a market in the interests; (2) any person
regularly makes available to the public (including customers or subscribers) bid
or offer quotes with respect to Subject Certificates (or interests therein) and
stands ready to effect buy or sell transactions at the quoted prices for itself
or on behalf of others; (3) the holders of Subject Certificates have a readily
available, regular, and ongoing opportunity to sell or exchange the Subject
Certificates (or interests therein) through a public means of obtaining or
providing information of offers to buy, sell, or exchange such interests; or (4)
prospective buyers and sellers otherwise have the opportunity to buy, sell, or
exchange Subject Certificates (or interests therein) in a time frame and with
the regularity and continuity that is comparable to that described in CLAUSES
(1), (2) and (3) of this sentence. For purposes of determining whether the Trust
will have more than 95 Holders of Subject Certificates, each Person indirectly
owning an interest in the Trust through a partnership (including any entity
treated as a partnership for federal income tax purposes), a grantor trust or an
S corporation (each such entity a "FLOW-THROUGH ENTITY") shall be treated as a
Holder of a Subject Certificate unless Servicer determines in its sole
discretion, after consulting with qualified tax counsel, that less than
substantially all of the value of the beneficial owner's interest in the
flow-through entity is attributable to the flow-through entity's interest
(direct or indirect) in the Trust.
SECTION 6.5. 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 Trustee such security or indemnity as may be required by them to save each of them harmless, then, in the absence of notice to Trustee that such Certificate has been acquired by a bona fide purchaser, Transferor shall execute, 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, Trustee or the Transfer Agent and Registrar may require the payment by the Holder 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 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 6.6. PERSONS DEEMED OWNERS. Trustee, the Paying Agent, the Transfer Agent and Registrar and any agent of any of these may (a) prior to due presentation of a Registered Certificate for registration of transfer, treat the Person in whose name any Registered Certificate is registered as the owner of such Registered Certificate for the purpose of receiving distributions pursuant to the 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 applicable Supplement and for all other purposes whatsoever; and, in any such case, neither Trustee, the Paying Agent, the Transfer Agent and Registrar nor any agent of any of these shall be affected by any notice to the contrary. Notwithstanding the foregoing, in determining whether the Holders of the requisite Investor Certificates have given any request, demand, authorization, direction, notice, consent or waiver hereunder, Certificates owned by Transferor, Servicer, any Holder of the Transferor Interest, Trustee or any Affiliate thereof, shall be disregarded and deemed not to be outstanding, except that, in determining whether Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Certificates which a Responsible Officer of the Trustee actually knows to be so owned shall be so disregarded. Certificates 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 Trustee the pledgee's right so to act with respect to such Certificates and that the pledgee is not Transferor, Servicer, any other Holder of the Transferor Interest or any Affiliate thereof.
SECTION 6.7. APPOINTMENT OF PAYING AGENT. The Paying Agent shall make distributions to Investor Holders from the Collection Account or any applicable Series Account pursuant to the provisions of the applicable Supplement and shall report the amounts of such distributions to Trustee. Any Paying Agent shall have the revocable power to withdraw funds from the Collection Account or any applicable Series Account for the purpose of making the distributions referred to above. Trustee may revoke such power and remove the Paying Agent if 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 Trustee, and any co-paying agent chosen by Transferor and acceptable to 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. Any Paying Agent shall be permitted to resign as Paying Agent upon 30 days' notice to Trustee. If any Paying Agent shall resign, Trustee shall appoint a successor to act as Paying Agent. Trustee shall cause each successor or additional Paying Agent to execute and deliver to Trustee an instrument in which such successor or additional Paying Agent shall agree with Trustee that it will hold all sums, if any, held by it for payment to the Investor Holders in trust for the benefit of the Investor Holders entitled thereto until such sums shall be paid to such Investor Holders. The Paying Agent shall return all unclaimed funds to Trustee and upon removal shall also return all funds in its possession to Trustee. The provisions of SECTIONS 11.1, 11.2, 11.3 and 11.5 shall apply to Trustee also in its role as Paying Agent, for so long as 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 6.8. ACCESS TO LIST OF REGISTERED HOLDERS' NAMES AND ADDRESSES. Trustee will furnish or cause to be furnished by the Transfer Agent and Registrar to Servicer or the Paying Agent, within five Business Days after receipt by Trustee of a request therefor, a list in such form as Servicer or the Paying Agent may reasonably require, of the names and addresses of the Registered Holders. 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 Trustee, and such application states that the Applicants desire to communicate with other Investor Holders 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 Trustee, after having been indemnified to its reasonable satisfaction 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 Holders of such Series or all outstanding Series, as applicable, held by Trustee, within five Business Days after the receipt of such application. Such list shall be as of a date no more than 45 days prior to the date of receipt of such Applicants' request.
Every Registered Holder, by receiving and holding a Registered Certificate, agrees with Trustee that neither 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 Holders hereunder, regardless of the sources from which such information was derived.
SECTION 6.9. AUTHENTICATING AGENT. (a) Trustee may appoint one or more authenticating agents with respect to the Certificates which shall be authorized to act on behalf of 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 Trustee or Trustee's certificate of authentication, such reference shall be deemed to include authentication on behalf of Trustee by an authenticating agent and certificate of authentication executed on behalf of Trustee by an authenticating agent. Each authenticating agent must be acceptable to Transferor and 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 Trustee or such authenticating agent. An authenticating agent may at any time resign by giving notice of resignation to Trustee and to Transferor. Trustee may at any time terminate the agency of an authenticating agent by giving notice of termination to such authenticating agent and to 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 Trustee or Transferor, 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 Trustee and Transferor. Transferor agrees to pay to each authenticating agent from time to time reasonable compensation for its services under this Section. The provisions of SECTIONS 11.1, 11.2 and 11.3 shall be applicable to any authenticating agent.
(c) Pursuant to an appointment made under this Section, the Certificates may have endorsed thereon, in lieu of Trustee's certificate of authentication, an alternate certificate of authentication in substantially the following form:
This is one of the Certificates described in the Pooling and Servicing Agreement.
as Authenticating Agent for Trustee,
By: ____________________________________
Authorized Officer
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 typewritten
Investor Certificates representing the Book-Entry Certificates, to be delivered
to the Clearing Agency, by, or on behalf of, 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) Transferor, Servicer and Trustee may deal with the Clearing Agency and the Clearing Agency Participants for all purposes (including the making of distributions) as the authorized representatives of the respective Certificate Owners;
(c) to the extent that the provisions of this Section conflict with any other provisions of this Agreement, the provisions of this Section shall control; and
(d) the rights of the respective Certificate Owners shall be exercised only through the Clearing Agency and the Clearing Agency Participants and shall be limited to those established by law and agreements between such Certificate Owners and the Clearing Agency or the Clearing Agency Participants. Pursuant to the Depository Agreement, unless and until Definitive Certificates are issued pursuant to SECTION 6.12, the Clearing Agency will make book-entry transfers among the Clearing Agency Participants and receive and transmit distributions of principal and interest on the related Investor Certificates to such Clearing Agency Participants.
For purposes of any provision of this Agreement requiring or permitting actions with the consent of, or at the direction of, Investor Holders 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 Holders 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, 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) Transferor advises 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 Trustee or Transferor is unable to engage a qualified successor, (b) Transferor, at its option, advises Trustee that it elects to terminate the book-entry system with respect to such Series or Class through the Clearing Agency or (c) after the occurrence of a Servicer Default, Certificate Owners of such Series or Class evidencing not less than 50% of the aggregate unpaid principal amount of such Series or Class advise 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 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 Trustee of any such Certificates by the Clearing Agency, accompanied by registration instructions from the Clearing Agency for registration, Transferor shall execute and Trustee shall authenticate and deliver such Definitive Certificates. Neither Transferor nor Trustee shall be liable for any delay in delivery of such instructions and may conclusively rely on, and shall be fully 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 Trustee, to the extent applicable with respect to such Definitive Certificates and Trustee shall recognize the Holders of such Definitive Certificates as Investor Holders hereunder.
SECTION 6.13. GLOBAL CERTIFICATE. If specified in the related Supplement for any Series, or Class, the Investor Certificates for such Series or Class will initially be issued in the form of a single temporary global Certificate (the "GLOBAL CERTIFICATE") in bearer form, without interest coupons, in the denomination of the aggregate principal amount of such Series or Class and substantially in the form set forth in the exhibit with respect thereto attached to the related Supplement. The Global Certificate will be executed by Transferor and authenticated by Trustee upon the same conditions, in substantially the same manner and with the same effect as the Definitive Certificates. The Global Certificate may be exchanged for Bearer or Registered Certificates in definitive form (the "DEFINITIVE EURO-CERTIFICATES") pursuant to any applicable Supplement.
SECTION 6.14. UNCERTIFICATED CLASSES. Unless otherwise specified in any Supplement, the provisions of this ARTICLE VI and ARTICLE XII relating to the registration, form, execution, authentication, delivery, presentation, cancellation and surrender of Certificates shall not apply to any uncertificated Certificates.
SECTION 6.15. CUSIP NUMBERS. The Transferor in issuing the Certificates may use "CUSIP" or "private placement" numbers (if then generally in use), and, if so, the Trustee shall indicate the "CUSIP" or "private placement" numbers of the Certificates in notices of redemption and related materials as a convenience to Holders; PROVIDED that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Certificates or as contained in any notice of redemption and related materials. The Transferor shall promptly notify the Trustee of any change in the CUSIP numbers.
ARTICLE VII OTHER MATTERS RELATING TO TRANSFEROR
SECTION 7.1. LIABILITY OF TRANSFEROR. Transferor shall be liable for its obligations, covenants, representations and warranties under this Agreement and any Supplement, but only to the extent of the obligations specifically undertaken by it in its capacity as Transferor.
SECTION 7.2. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS OF, TRANSFEROR. (a) Transferor shall not consolidate with or merge into any Person or convey or transfer its properties and assets substantially as an entirety to any Person unless:
(i) the Person formed by such consolidation or into which Transferor is merged or the Person which acquires by conveyance or transfer the properties and assets of Transferor substantially as an entirety shall be, if Transferor is not the surviving entity, an entity organized and existing under the laws of the United States of America or any State or the District of Columbia, and, if Transferor is not the surviving entity, such entity shall expressly assume, by an agreement supplemental hereto, executed and delivered to Trustee, in form reasonably satisfactory to Trustee, the performance of every covenant and obligation of Transferor hereunder, including its obligations under SECTION 7.4;
(ii) Transferor has delivered to Trustee (A) an Officer's Certificate stating that such consolidation, merger, conveyance or transfer and such supplemental agreement comply with this Section and that all conditions precedent herein provided for relating to such transaction have been complied with, and (B) an Opinion of Counsel to the effect that such supplemental agreement is a valid and binding obligation of such surviving entity enforceable against such surviving entity in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors' rights generally from time to time in effect and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity);
(iii) Transferor shall have delivered to Trustee and each Rating Agency a Tax Opinion, dated the date of such consolidation, merger, conveyance or transfer, with respect thereto;
(iv) in connection with any merger or consolidation, or any conveyance or transfer referred to above, the business entity into which Transferor shall merge or consolidate, or to which such conveyance or transfer is made, shall be (x) a business entity that may not become a debtor in any case, action or other proceeding under Title 11 of the United States Code or (y) a special-purpose entity, the powers and activities of which shall be limited to the performance of Transferor's obligations under this Agreement and any Supplement; and
(v) if Transferor is not the surviving entity, the surviving entity shall file new UCC-1 financing statements with respect to the interest of the Trust in the Receivables.
(b) This SECTION 7.2 shall not be construed to prohibit or in any way limit Transferor's ability to effectuate any consolidation or merger pursuant to which Transferor would be the surviving entity.
(c) Transferor shall notify each Rating Agency promptly after any consolidation, merger, conveyance or transfer effected pursuant to this SECTION 7.2;
(d) The obligations of Transferor hereunder shall not be assignable nor
shall any Person succeed to the obligations of Transferor hereunder except in
each case in accordance with (i) the provisions of the foregoing paragraphs,
(ii) SECTIONS 2.11 or 6.3(d), or (iii) conveyances, mergers, consolidations,
assumptions, sales or transfers to other entities (1) for which Transferor
delivers an Officer's Certificate to Trustee indicating that Transferor
reasonably believes that such action will not adversely affect in any material
respect the interests of any Investor Holder, (2) which meet the requirements of
CLAUSE (ii) of PARAGRAPH (a) and (3) for which such purchaser, transferee,
pledgee or entity shall expressly assume, in an agreement supplemental hereto,
executed and delivered to Trustee in writing in form satisfactory to Trustee,
the performance of every covenant and obligation of Transferor thereby conveyed.
SECTION 7.3. LIMITATIONS ON LIABILITY OF TRANSFEROR. Subject to SECTIONS 7.1 and 7.4, neither Transferor, any Holder of the Transferor Interest nor any of their directors, officers, employees or agents of Transferor acting in such capacities shall be under any liability to the
Trust, Trustee, the Holders, any Enhancement Provider or any other Person for any action taken or for refraining from the taking of any action in good faith in their capacities as Transferor pursuant to this Agreement; PROVIDED that this provision shall not protect Transferor, any Holder of the Transferor Interest or any such Person against any liability which would otherwise be imposed by reason of willful misfeasance, bad faith or negligence in the performance of duties or by reason of reckless disregard of obligations and duties hereunder. Transferor and any director, officer, employee or agent of Transferor may rely in good faith on any document of any kind prima facie properly executed and submitted by any Person (other than Transferor) respecting any matters arising hereunder.
SECTION 7.4. LIABILITIES. Notwithstanding SECTIONS 7.3, 8.3 and 8.4, Transferor by entering into this Agreement, and any Holder of the Transferor Interest by its acceptance of an interest therein, agree to be liable, directly to the injured party, for the entire amount of any losses, claims, damages or liabilities (other than those that would be incurred by an Investor Holder if the Investor Certificates were notes secured by the Receivables, for example, as a result of the performance of the Receivables, market fluctuations, a shortfall or failure to make payment under any Enhancement or other similar market or investment risks associated with ownership of the Investor Certificates) arising out of or based on the arrangement created by this Agreement or the actions of Servicer taken pursuant hereto (to the extent Trust Assets remaining after the Investor Holders and Enhancement Providers, if any, have been paid in full are insufficient to pay any such losses, claims, damages or liabilities) as though this Agreement created a partnership under the Delaware Revised Uniform Partnership Act in which Transferor and such Holder of the Transferor Interest were general partners.
ARTICLE VIII OTHER MATTERS RELATING TO SERVICER
SECTION 8.1. LIABILITY OF SERVICER. Servicer shall be liable under this Agreement only to the extent of the obligations specifically undertaken by Servicer in its capacity as Servicer.
SECTION 8.2. MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS OF, SERVICER. (a) Servicer shall not consolidate with or merge into any other corporation or convey or transfer its properties and assets substantially as an entirety to any Person, unless:
(i) the corporation formed by such consolidation or into which Servicer is merged or the Person which acquires by conveyance or transfer the properties and assets of Servicer substantially as an entirety shall be, if 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 Servicer is not the surviving entity, such corporation shall expressly assume, by an agreement supplemental hereto, executed and delivered to Trustee, in form reasonably satisfactory to Trustee, the performance of every covenant and obligation of Servicer hereunder;
(ii) Servicer has delivered to Trustee (A) an Officer's Certificate stating that such consolidation, merger, conveyance or transfer and such supplemental agreement comply with this Section and that all conditions precedent herein provided for relating to such transaction have been complied with, and (B) an Opinion of Counsel to the effect that such supplemental agreement is a valid and binding obligation of such surviving entity
enforceable against such surviving entity in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors' rights generally from time to time in effect and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity); and
(iii) either (x) the corporation formed by such consolidation or into which Servicer is merged or the Person which acquired by conveyance or transfer the properties and assets of Servicer substantially as an entirety shall be an Eligible Servicer (taking into account, in making such determination, the experience and operations of the predecessor Servicer) or (y) upon the effectiveness of such consolidation, merger, conveyance or transfer, a Successor Servicer shall have assumed the obligations of Servicer in accordance with this Agreement.
(b) This SECTION 8.2 shall not be construed to prohibit or in any way limit Servicer's ability to effectuate any consolidation or merger pursuant to which Servicer would be the surviving entity.
(c) Servicer shall notify each Rating Agency promptly after any consolidation, merger, conveyance or transfer effected pursuant to this SECTION 8.2.
SECTION 8.3. LIMITATION ON LIABILITY OF SERVICER AND OTHERS. Except as provided in SECTIONS 8.4 and 11.5, neither Servicer nor any of the directors, officers, employees or agents of Servicer in its capacity as Servicer shall be under any liability to the Trust, Trustee, the Holders, any Enhancement Providers 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 that this provision shall not protect Servicer or any such Person against any liability which would otherwise be imposed by reason of willful misfeasance, bad faith or negligence in the performance of duties or by reason of reckless disregard of obligations and duties hereunder. Servicer and any director, officer, employee or agent of Servicer may rely in good faith on any document of any kind prima facie properly executed and submitted by any Person (other than Servicer) respecting any matters arising hereunder. 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. Servicer may, in its sole discretion, undertake any such legal action which it may deem necessary or desirable for the benefit of the Holders with respect to this Agreement and the rights and duties of the parties hereto and the interests of the Holders hereunder.
SECTION 8.4. SERVICER INDEMNIFICATION OF THE TRUST AND TRUSTEE. Servicer shall indemnify and hold harmless the Trust and Trustee and its officers, directors, employees and agents, from and against any loss, liability, expense, damage or injury (i) suffered or sustained by reason of any acts or omissions of Servicer with respect to the Trust pursuant to this Agreement, and (ii) arising from or incurred in connection with the Trustee's administration of this Trust and the performance of its duties hereunder under the Series Supplements or any transaction or document contemplated in connection herewith or therewith including any judgment, award, settlement, reasonable attorneys' fees and expenses and other costs or expenses incurred in connection with the defense of any action, proceeding or claim; PROVIDED that (a) Servicer shall
not indemnify Trustee if such acts, omissions or alleged acts or omissions
constitute or are caused by fraud, negligence, or willful misconduct by Trustee,
(b) Servicer shall not indemnify the Trust, the Investor Holders or the
Certificate Owners for any liabilities, costs or expenses of the Trust with
respect to any action taken by Trustee at the request of the Investor Holders,
(c) Servicer shall not indemnify the Trust, the Investor Holders or the
Certificate Owners as to any losses, claims or damages incurred by any of them
in their capacities as investors, including losses with respect to market or
investment risks associated with ownership of the Investor Certificates or
losses incurred as a result of Defaulted Receivables and (d) Servicer shall not
indemnify the Trust, the Investor Holders or the Certificate Owners for any
liabilities, costs or expenses of the Trust, the Investor Holders or the
Certificate Owners arising under any tax law, including any Federal, state,
local or foreign income or franchise taxes or any other tax imposed on or
measured by income (or any interest or penalties with respect thereto or arising
from a failure to comply therewith) required to be paid by the Trust, the
Investor Holders or the Certificate Owners in connection herewith to any taxing
authority. Indemnification pursuant to this Section shall not be payable from
the Trust Assets. The provisions of this indemnity shall run directly to and be
enforceable by an indemnitee subject to the limitations hereof. This SECTION 8.4
shall survive the termination of this Agreement and the earlier removal or
resignation of the Trustee.
SECTION 8.5. SERVICER NOT TO RESIGN. Servicer shall not resign from the obligations and duties hereby imposed on it except (x) upon the determination that (i) the performance of its duties hereunder is no longer permissible under Requirements of Law (other than the charter and by-laws of Servicer) and (ii) there is no reasonable action which Servicer could take to make the performance of its duties hereunder permissible under such Requirements of Law or (y) as may be required, in connection with Servicer's consolidation with, or merger into any other corporation or Servicer's conveyance or transfer of its properties and assets substantially as an entirety to any person in each case, in accordance with SECTION 8.2. Any determination permitting the resignation of Servicer pursuant to clause (x) above shall be evidenced by an Opinion of Counsel to such effect delivered to Trustee. No resignation shall become effective until Trustee or a Successor Servicer shall have assumed the responsibilities and obligations of Servicer in accordance with SECTION 10.2. If within 120 days of the date of the determination that Servicer may no longer act as Servicer, and if Trustee is unable to appoint a Successor Servicer, Trustee shall serve as Successor Servicer. Notwithstanding the foregoing, Trustee shall, if it is legally unable so to act, petition a court of competent jurisdiction to appoint any established institution having a net worth of not less than $50,000,000 and whose regular business includes the servicing of credit card accounts as the Successor Servicer hereunder. Trustee shall give prompt notice to each Rating Agency and each Enhancement Provider, if any, entitled thereto under the applicable Supplement upon the appointment of a Successor Servicer.
SECTION 8.6. ACCESS TO CERTAIN DOCUMENTATION AND INFORMATION REGARDING THE RECEIVABLES. Servicer shall provide to Trustee access to the documentation regarding the Accounts and the Receivables in such cases where Trustee is required in connection with the enforcement of the rights of Holders 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 Servicer's normal security and confidentiality procedures and (d) at reasonably accessible offices in the continental United States designated by
Servicer. Nothing in this Section shall derogate from the obligation of each Credit Card Originator, Transferor, Trustee and Servicer to observe any applicable law prohibiting disclosure of information regarding the Obligors, and the failure of Servicer to provide access as provided in this Section as a result of such obligation shall not constitute a breach of this Section.
SECTION 8.7. DELEGATION OF DUTIES. In the ordinary course of business, Servicer may at any time delegate any duties hereunder to any Person who agrees to conduct such duties in accordance with the Credit Card Guidelines and this Agreement. Any such delegations shall not relieve Servicer of its liability and responsibility with respect to such duties, and shall not constitute a resignation within the meaning of SECTION 8.5, and Servicer shall remain jointly and severally liable with such Person for any amounts which would otherwise be payable pursuant to this ARTICLE VIII as if Servicer had performed such duty; PROVIDED that in the case of any significant delegation to a Person other than an Affiliate of WFN, at least 30 days' prior written notice shall be given to Trustee, each Rating Agency and each Enhancement Provider, if any, entitled thereto pursuant to the relevant Supplement, of such delegation to any entity that is not an Affiliate of Servicer.
ARTICLE IX EARLY AMORTIZATION EVENTS
SECTION 9.1. EARLY AMORTIZATION EVENTS. Each of the following shall constitute an "EARLY AMORTIZATION EVENT" with respect to each Series:
(a) the occurrence of an Insolvency Event relating to WFN or the Transferor;
(b) the Trust shall become an "investment company" within the meaning of the Investment Company Act; or
(c) WFN shall become unable for any reason to transfer Receivables to the Transferor pursuant to the Receivables Purchase Agreement or Transferor shall become unable for any reason to transfer Receivables to the Trust pursuant to this Agreement.
SECTION 9.2. ADDITIONAL RIGHTS UPON CERTAIN EVENTS. (a) If an Insolvency Event occurs with respect to Transferor or any Holder of the Transferor Interest (excluding any Supplemental Interest), Transferor shall on the day any such event occurs (the "APPOINTMENT DATE"), immediately cease to transfer Principal Receivables, or interests in Principal Receivables represented by any Participation Interests to the Trust and shall promptly give notice to Trustee thereof. Notwithstanding any cessation of the transfer to the Trust of additional Principal Receivables or any Participation Interests, Principal Receivables or any Participation Interests transferred to the Trust prior to the occurrence of such Insolvency Event and Collections in respect of such Principal Receivables and Participation Interests, and Finance Charge Receivables whenever created accrued in respect of such Principal Receivables, shall continue to be a part of the Trust. Upon the Appointment Date, this Agreement and the Trust shall be deemed to have terminated, subject to the liquidation, winding up and dissolution procedures described below. Within 15 days of the Appointment Date, Trustee shall (i) publish a notice in an Authorized Newspaper that an Insolvency Event has occurred, that the Trust has terminated, and that Trustee intends to sell, dispose of or otherwise liquidate the Receivables and any Participation Interests on commercially reasonable terms and in a commercially reasonable
manner and (ii) give notice to Investor Holders and each Enhancement Provider, if any, or other Person entitled thereto pursuant to the relevant Supplement describing the provisions of this Section. Trustee shall then promptly sell, dispose of or otherwise liquidate the Receivables and any Participation Interests in a commercially reasonable manner and on commercially reasonable terms, which shall include the solicitation of competitive bids. The Trustee shall be entitled to hire and consult with financial advisors and agents in connection with such sale, disposition or liquidation, at the expense of the Servicer and/or the Trust. Trustee may obtain a prior determination from any conservator, receiver or liquidator that the terms and manner of any proposed sale, disposition or liquidation are commercially reasonable and may conclusively rely on such determination. The provisions of SECTIONS 9.1 and 9.2 shall not be deemed to be mutually exclusive.
(b) The proceeds from the sale, disposition or liquidation of the Receivables and any Participation Interests pursuant to PARAGRAPH (a) ("INSOLVENCY PROCEEDS") shall be immediately deposited in the Collection Account. Insolvency Proceeds shall be allocated to Finance Charge Receivables and Principal Receivables in the same proportion such Receivables bore to one another on the prior Determination Date, although Trustee shall, in consultation with the Servicer, determine conclusively the amount of the Insolvency Proceeds which are deemed to be Finance Charge Receivables and Principal Receivables. The Insolvency Proceeds shall be allocated and distributed to Investor Holders in accordance with ARTICLE IV and each such Supplement.
ARTICLE X SERVICER DEFAULTS
SECTION 10.1. SERVICER DEFAULTS. If any one of the following events (a "SERVICER DEFAULT") shall occur and be continuing:
(a) any failure by Servicer to make any payment, transfer or deposit or to give instructions or notice to Trustee pursuant to this Agreement or any Supplement on or before the date occurring five Business Days after the date such payment, transfer or deposit or such instruction or notice is required to be made or given, as the case may be, under this Agreement or any Supplement;
(b) failure on the part of Servicer to duly observe or perform in any material respect any other covenants or agreements of Servicer set forth in this Agreement or any Supplement which has a material adverse effect on the interests hereunder of the Investor Holders of any Series or Class (which determination shall be made without regard to whether funds are then available pursuant to any Enhancement) and which continues unremedied for a period of 60 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to Servicer by Trustee, or to Servicer and Trustee by Holders of Investor Certificates evidencing not less than 25% of the aggregate unpaid principal amount of all Investor Certificates (or, with respect to any such failure that does not relate to all Series, 25% of the aggregate unpaid principal amount of all Series to which such failure relates); or Servicer shall delegate its duties under this Agreement, except as permitted by SECTIONS 8.2 and 8.7, a Responsible Officer of Trustee has actual knowledge of such delegation and such delegation continues unremedied for 15 days after the date on which written notice thereof, requiring the same to be remedied, shall have been given to Servicer by Trustee, or to Servicer and Trustee by
Holders of Investor Certificates evidencing not less than 25% of the aggregate unpaid principal amount of all Investor Certificates;
(c) any representation, warranty or certification made by 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 a material adverse effect on the rights of the Investor Holders of any Series or Class (which determination shall be made without regard to whether funds are then available pursuant to any Enhancement) and which continues to be incorrect in any material respect for a period of 60 days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to Servicer by Trustee, or to Servicer and Trustee by the Holders of Investor Certificates evidencing not less than 25% of the aggregate unpaid principal amount of all Investor Certificates (or, with respect to any such representation, warranty or certification that does not relate to all Series, 25% of the aggregate unpaid principal amount of all Series to which such representation, warranty or certification relates); or
(d) Servicer shall fail generally to, or admit in writing its inability to, pay its debts as they become due; or a proceeding shall have been instituted in a court having jurisdiction in the premises seeking a decree or order for relief in respect of Servicer in an involuntary case under any Debtor Relief Law, or for the appointment of a receiver, liquidator, assignee, trustee, custodian, sequestrator, conservator or other similar official of such Person or for any substantial part of its property, or for the winding-up or liquidation of its affairs and, if instituted against Servicer, any such proceeding shall continue undismissed or unstayed and in effect, for a period of 60 consecutive days, or any of the actions sought in such proceeding shall occur; or the commencement by Servicer, of a voluntary case under any Debtor Relief Law, or such Person's consent to the entry of an order for relief in an involuntary case under any Debtor Relief Law, or consent to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator, conservator or other similar official of such Person or for any substantial part of its property, or any general assignment for the benefit of creditors; or such Person or any Subsidiary of such Person shall have taken any corporate action in furtherance of any of the foregoing actions;
then, in the event of any Servicer Default, so long as the Servicer Default shall not have been remedied, either Trustee or the Holders of Investor Certificates evidencing more than 50% of the aggregate unpaid principal amount of all Investor Certificates, by notice given to Servicer (and to Trustee and any Enhancement Provider entitled thereto pursuant to the relevant Supplement if given by the Investor Holders) (a "TERMINATION NOTICE"), may terminate all but not less than all the rights and obligations of Servicer, as Servicer, under this Agreement and in and to the Receivables and the proceeds thereof.
After receipt by Servicer of such Termination Notice, and on the date that a Successor Servicer shall have been appointed by Trustee pursuant to SECTION 10.2, all authority and power of Servicer under this Agreement shall pass to and be vested in the Successor Servicer (a "SERVICE TRANSFER"); and, without limitation, Trustee is hereby authorized and empowered (upon the failure of Servicer to cooperate) to execute and deliver, on behalf of Servicer, as attorney-in-fact or otherwise, all documents and other instruments upon the failure of Servicer to execute or deliver such documents or instruments, and to do and accomplish all other acts or things
necessary or appropriate to effect the purposes of such transfer of servicing rights. Servicer agrees to cooperate with Trustee and the Successor Servicer in effecting the termination of the responsibilities and rights of Servicer to conduct servicing hereunder including the transfer to the Successor Servicer of all authority of 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 Servicer for deposit, or which have been deposited by Servicer, in the Collection Account, or which shall thereafter be received with respect to the Receivables, and in assisting the Successor Servicer and in enforcing all rights to Insurance Proceeds. Servicer shall promptly transfer its electronic records relating to the Receivables to the Successor Servicer in such electronic form as the Successor Servicer may reasonably request and shall promptly transfer to the Successor Servicer all other records, correspondence and documents necessary for the continued servicing of the Receivables in the manner and at such times as the Successor Servicer shall reasonably request. To the extent that compliance with this SECTION 10.1 shall require Servicer to disclose to the Successor Servicer information of any kind which Servicer reasonably deems to be confidential, the Successor Servicer shall be required to enter into such customary licensing and confidentiality agreements as Servicer shall deem appropriate to protect its interests.
Notwithstanding the foregoing, any delay in or failure of performance
under SECTION 10.1(a) for a period of five Business Days or under SECTION
10.1(b) or (c) for a period of 60 days (in addition to any period provided in
SECTION 10.1(a), (b) or (c)) shall not constitute a Servicer Default until the
expiration of such additional five Business Days or 60 days, respectively, if
such delay or failure could not be prevented by the exercise of reasonable
diligence by 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 Servicer from
the obligation to use its best efforts to perform its obligations in a timely
manner in accordance with this Agreement and any Supplement and Servicer shall
provide Trustee, each Rating Agency, any Enhancement Provider entitled thereto
pursuant to the relevant Supplement, Transferor and the Investor Holders with an
Officer's Certificate giving immediate notice of such failure or delay by it,
together with a description of its efforts to so perform its obligations.
SECTION 10.2. TRUSTEE TO ACT; APPOINTMENT OF SUCCESSOR. (a) On and after the receipt by Servicer of a Termination Notice pursuant to SECTION 10.1, Servicer shall continue to perform all servicing functions under this Agreement until the date specified in the Termination Notice or otherwise specified by Trustee or until a date mutually agreed upon by Servicer and Trustee. 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 Trustee. If a Successor Servicer has not been appointed or has not accepted its appointment at the time when Servicer ceases to act as Servicer, Trustee without further action shall automatically be appointed the Successor Servicer. Trustee may delegate any of its servicing obligations to an Affiliate of Trustee or agent in accordance with SECTION 3.1(b) and 8.7. Notwithstanding the foregoing, Trustee shall, if it is legally unable so to act, petition a court of competent jurisdiction to appoint any established institution having a net worth of not less than $50,000,000 and whose regular business includes the servicing of credit card receivables as the Successor Servicer hereunder. Trustee shall give prompt notice to each Rating Agency and each Enhancement Provider, if any,
entitled thereto pursuant to the applicable Supplement upon the appointment of a Successor Servicer.
(b) Upon its appointment, the Successor Servicer shall be the successor in all respects to Servicer with respect to servicing functions under this Agreement and shall be subject to all the responsibilities, duties and liabilities (except for liabilities arising during the period of time when the prior Servicer was performing and acting as Servicer) relating thereto placed on Servicer by the terms and provisions hereof, and all references in this Agreement to Servicer shall be deemed to refer to the Successor Servicer.
(c) In connection with any Termination Notice, 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 for servicing compensation not in excess of the aggregate Servicing Fees for all Series; PROVIDED, HOWEVER, that the Holder of the Transferor Interest shall be responsible for payment of the portion of such aggregate Servicing Fees allocable to the Holder of the Transferor Interest and that no such monthly compensation paid out of Collections shall be in excess of such aggregate Servicing Fees. Each Holder of the Transferor Interest agrees that, if WFN (or any Successor Servicer) is terminated as Servicer hereunder, the portion of the Collections in respect of Finance Charge Receivables that Transferor is entitled to receive pursuant to this Agreement or any Supplement shall be reduced by an amount sufficient to pay Transferor's share (determined by reference to the Supplements with respect to any outstanding Series) of the compensation of the Successor Servicer.
(d) All authority and power granted to the Successor Servicer under this Agreement shall automatically cease and terminate upon termination of the Trust pursuant to SECTION 12.1 and shall pass to and be vested in Transferor and, without limitation, Transferor is hereby authorized and empowered to execute and deliver, on behalf of the Successor Servicer, as attorney-in-fact or otherwise, all documents and other instruments, and to do and accomplish all other acts or things necessary or appropriate to effect the purposes of such transfer of servicing rights. The Successor Servicer agrees to cooperate with Transferor in effecting the termination of the responsibilities and rights of the Successor Servicer to conduct servicing on the Receivables. The Successor Servicer shall transfer its electronic records relating to the Receivables to Transferor in such electronic form as Transferor may reasonably request and shall transfer all other records, correspondence and documents to Transferor in the manner and at such times as Transferor shall reasonably request. To the extent that compliance with this SECTION 10.2 shall require the Successor Servicer to disclose to Transferor information of any kind which the Successor Servicer deems to be confidential, Transferor shall be required to enter into such customary licensing and confidentiality agreements as the Successor Servicer shall deem appropriate to protect its interests.
SECTION 10.3. NOTIFICATION TO HOLDERS. Within two Business Days after Servicer becomes aware of any Servicer Default, Servicer shall give notice thereof to Trustee, each Rating Agency and any Enhancement Provider entitled thereto pursuant to the relevant Supplement and Trustee shall give notice to the Investor Holders. Upon any termination or appointment of a Successor Servicer pursuant to this Article, Trustee shall give prompt notice thereof to the Investor Holders.
SECTION 10.4. WAIVER OF PAST DEFAULTS. The Holders of Investor Certificates evidencing undivided interests in the Trust aggregating more than 66-2/3% of the Invested Amount of each Series then outstanding affected by any default by Servicer may, on behalf of all Holders of Certificates of such affected Series, waive any default by Servicer in the performance of its obligations hereunder and its consequences, except a default in the failure to make any required deposits or payments of interest or principal with respect to any Series of Certificates. 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.
ARTICLE XI TRUSTEE
SECTION 11.1. DUTIES OF TRUSTEE. (a) Trustee, prior to the occurrence of a Servicer Default 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 covenants or obligations shall be read into this Agreement against the Trustee. If a Servicer Default has occurred (which has not been cured or waived) Trustee shall exercise such of the rights and powers vested in it by this Agreement, and use the same degree of care and skill in its exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs.
(b) Trustee, upon receipt of all resolutions, certificates, statements, opinions, reports, documents, orders or other instruments furnished to Trustee which are specifically required to be furnished pursuant to any provision of this Agreement (but need not confirm or investigate the accuracy of any mathematical calculations or other facts stated therein), shall examine them to determine whether they substantially conform to the requirements of this Agreement. Trustee shall give prompt written notice to the Holders of any material lack of conformity of any such instrument to the applicable requirements of this Agreement discovered by Trustee which would entitle a specified percentage of the Holders to take any action pursuant to this Agreement.
(c) Subject to SECTION 11.1(a), no provision of this Agreement shall be construed to relieve Trustee from liability for its own negligent action, its own negligent failure to act or its own misconduct; PROVIDED that:
(i) Trustee shall not be personally liable for an error of judgment made in good faith by a Responsible Officer or Responsible Officers of Trustee, unless it shall be proved that Trustee was negligent in ascertaining the pertinent facts;
(ii) Trustee shall not be personally liable with respect to any action taken, suffered or omitted to be taken by it in good faith in accordance with the direction of the Holders of Investor Certificates relating to the time, method and place of conducting any proceeding for any remedy available to Trustee, or exercising any trust or power conferred upon Trustee, under this Agreement; PROVIDED that, such direction is delivered by the Holder of Investor Certificates evidencing the percentage of the aggregate unpaid principal amount of Investor Certificates of all Series to which such action relates required for such action by this Agreement; and
(iii) Trustee shall not be charged with knowledge of (x) any failure by Servicer referred to in SECTION 10.1 or (y) any Early Amortization Event unless a Responsible Officer of Trustee obtains actual knowledge of such failure or Early Amortization Event or Trustee receives written notice of such failure or Early Amortization Event from Servicer, any Holders of Investor Certificates evidencing not less than 25% of the aggregate unpaid principal amount of all Investor Certificates (or, with respect to any such failure that does not relate to all Series, 25% of the aggregate unpaid principal amount of all Investor Certificates of all Series to which such failure relates, or the Enhancement Providers, if any, for all Series to which such failure relates).
(d) Trustee shall not be required to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or in the exercise of any of its rights or powers hereunder or thereunder, if there is reasonable ground for believing that the repayment of such funds or indemnity reasonably satisfactory to it against such risk or liability is not reasonably assured to it, and none of the provisions contained in this Agreement shall in any event require Trustee to perform, or be responsible for the manner of performance of, any of the obligations of Servicer under this Agreement except during such time, if any, as Trustee shall be the successor to, and be vested with the rights, duties, powers and privileges of, Servicer in accordance with this Agreement.
(e) Trustee shall have no power to vary the corpus of the Trust, except as expressly provided in this Agreement.
(f) If 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, Trustee shall be obligated promptly upon knowledge of a Responsible Officer thereof and receipt of appropriate records, if any, to perform such obligation, duty or agreement in the manner so required.
(g) If Credit Card Originator has agreed to transfer any of its receivables (other than the Receivables) to another Person other than the Transferor, upon the written request of Credit Card Originator, Trustee will enter into such intercreditor agreements with the transferee of such receivables as are customary and necessary to separately identify the rights of the Trust and such other Person in Credit Card Originator's receivables; PROVIDED that Trustee shall not be required to enter into any intercreditor agreement which could adversely affect the interests of the Holders and, upon the request of Trustee, Credit Card Originator will deliver an Opinion of Counsel relating to such intercreditor agreement.
SECTION 11.2. CERTAIN MATTERS AFFECTING TRUSTEE. Except as otherwise provided in Section 11.1:
(a) Trustee may conclusively rely on and shall be fully protected in acting on, or in refraining from acting in accord with, any resolution, Officer's Certificate, certificate of auditors or any other certificate, statement, instrument, opinion, report, notice, request, consent, order, appraisal, bond or other paper or document (whether in its original or facsimile form) reasonably believed by it to be genuine and to have been signed or presented to it pursuant to this
Agreement by the proper party or parties. The Trustee need not investigate any fact or matter stated in the document;
(b) Trustee may consult with counsel selected by it, and any advice of such counsel, or Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken or suffered or omitted by it hereunder in good faith and in accordance with such advice or Opinion of Counsel;
(c) Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Agreement or any Enhancement Agreement, or to institute, conduct or defend any litigation hereunder or thereunder or in relation to this Agreement or any Enhancement Agreement, at the request, order or direction of any of the Holders, pursuant to the provisions of this Agreement or any Enhancement Agreement, unless such Holders shall have offered to Trustee security or indemnity reasonably satisfactory to it against the costs, expenses and liabilities which may be incurred therein or thereby; nothing contained herein shall, however, relieve Trustee of the obligations, upon the occurrence of any Servicer Default (which has not been cured) to exercise such of the rights and powers vested in it by this Agreement, and to use the same degree of care and skill in its exercise, as a prudent person would exercise or use under the circumstances in the conduct of such person's own affairs;
(d) Trustee shall not be personally liable for any action taken, suffered or omitted by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Agreement;
(e) Trustee shall not be bound to make any investigation into the facts of matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, consent, order, approval, bond or other paper or document, unless requested in writing to do so by Holders of Investor Certificates evidencing more than 25% of the aggregate unpaid principal amount of all Investor Certificates (or, with respect to any such matters that do not relate to all Series, 25% of the aggregate unpaid principal amount of the Investor Certificates of all Series to which such matters relate);
(f) Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys, custodians or nominees, and Trustee shall not be responsible for any misconduct or negligence on the part of any such agent, attorney, custodian or nominee appointed with due care by it hereunder;
(g) except as may be required by SECTION 11.1(a), 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 Transferor with its representations and warranties or for any other purpose;
(h) Money held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law. The Trustee shall be under no liability for interest on any money received by it hereunder;
(i) Before the Trustee acts or refrains from acting, it may require an Officers' Certificate or an Opinion of Counsel. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers' Certificate or Opinion of Counsel;
(j) The Trustee shall not be required to give any bond or surety in respect of the performance of its powers and duties hereunder;
(k) The Trustee shall not be bound to ascertain or inquire as to the performance or observance of any covenants, conditions or agreements on the part of the Transferor or the Servicer;
(l) The permissive rights of the Trustee to do things enumerated in this Agreement shall not be construed as a duty and the Trustee shall not be answerable for other than its negligence or willful default; and
(m) 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 or Transfer Agent or Registrar.
SECTION 11.3. TRUSTEE NOT LIABLE FOR RECITALS IN CERTIFICATES. 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, 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. Trustee shall not be accountable for the use or application by Transferor of any of the Certificates or of the proceeds of such Certificates, or for the use or application of any funds paid to Transferor or the Holder of the Transferor Interest 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 this Agreement.
SECTION 11.4. TRUSTEE NOT TO OWN CERTIFICATES. Trustee shall not in its individual capacity, but may in a fiduciary capacity, become the owner or pledgee of Investor Certificates. If Trustee becomes the owner or pledgee of Investor Certificates in a fiduciary capacity it shall have the same rights as it would have if it were not Trustee.
SECTION 11.5. SERVICER TO PAY TRUSTEE'S FEES AND EXPENSES. Servicer covenants and agrees to pay to Trustee from time to time, and 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 Trustee, and Servicer will pay or reimburse Trustee (without reimbursement from the Collection Account or otherwise) upon its request for all reasonable expenses or disbursements incurred or made by 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 shall be determined to have been caused by its own negligence, willful misconduct or bad faith and except as provided
in the following sentence. If Trustee is appointed Successor Servicer pursuant to SECTION 10.2, the provisions of this SECTION 11.5 shall not apply to expenses, disbursements and advances made or incurred by Trustee in its capacity as Successor Servicer. When the Trustee incurs expenses or renders services in connection with an Insolvency Event or a Servicer Default under Section 10.1(d), such expenses (including the fees and expenses of its counsel and agents) and the compensation for such services are intended to constitute expenses of administration under any bankruptcy law or law relating to creditors rights generally.
The obligations of Servicer under SECTION 8.4 and this SECTION 11.5 shall survive the termination of the Trust and the resignation or removal of Trustee.
SECTION 11.6. ELIGIBILITY REQUIREMENTS FOR TRUSTEE. Trustee shall at all
times be a bank, trust company or a corporation organized and doing business
under the laws of the United States of America or any state thereof authorized
under such laws to exercise corporate trust powers, having a combined capital
and surplus of at least $50,000,000 and subject to supervision or examination by
Federal or state authority and maintain any credit or deposit rating required by
any Rating Agency (as of the date hereof Baa3 for Moody's) that is not an
Affiliate of the Transferor. If such bank or corporation publishes reports of
condition at least annually, pursuant to law or to the requirements of the
aforesaid supervising or examining authority, then for the purpose of this
SECTION 11.6, the combined capital and surplus of such bank or corporation shall
be deemed to be its combined capital and surplus as set forth in its most recent
report of condition so published. In case at any time Trustee shall cease to be
eligible in accordance with the provisions of this SECTION 11.6, Trustee shall
resign immediately in the manner and with the effect specified in SECTION 11.7.
SECTION 11.7. RESIGNATION OR REMOVAL OF TRUSTEE. (a) Trustee may at any time resign and be discharged from the trust hereby created by giving written notice thereof to Servicer. Upon receiving such notice of resignation, Transferor shall promptly appoint a successor trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to the resigning Trustee and one copy to the successor trustee. If no successor trustee shall have been so appointed and have accepted within 30 days after the giving of such notice of resignation, the resigning Trustee may petition at the expense of the transferor any court of competent jurisdiction for the appointment of a successor trustee.
(b) If at any time Trustee shall cease to be eligible in accordance with the provisions of SECTION 11.6 and shall fail to resign after written request therefor by Servicer or Transferor, or if at any time Trustee shall be legally unable to act, or shall be adjudged a bankrupt or insolvent, or a receiver of Trustee or of its property shall be appointed, or any public officer shall take charge or control of Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, in which event Servicer shall remove Trustee and promptly appoint a successor trustee by written instrument, in duplicate, one copy of which instrument shall be delivered to Trustee so removed and one copy to the successor trustee. If no successor trustee shall have been so appointed and have accepted within 30 days of the giving of such notice of removal, the removed trustee may petition any court of competent jurisdiction for the appointment of a successor trustee.
(c) Any resignation or removal of Trustee and appointment of a successor trustee pursuant to any of the provisions of this SECTION 11.7 shall not become effective until acceptance of appointment by the successor trustee as provided in SECTION 11.8 and any liability of Trustee arising hereunder shall survive such appointment of a successor trustee.
SECTION 11.8. SUCCESSOR TRUSTEE. (a) Any successor trustee appointed as provided in SECTION 11.7 shall execute, acknowledge and deliver to Transferor, to Servicer and to its predecessor Trustee an instrument accepting such appointment hereunder, and thereupon the resignation or removal of the predecessor Trustee shall become effective and such successor trustee, without any further act, deed or conveyance, shall become fully vested with all the rights, powers, duties and obligations of its predecessor hereunder, with the like effect as if originally named as Trustee herein. Upon payment in full of all fees and expenses due and owing to it hereunder, the predecessor Trustee shall deliver to the successor trustee all documents and statements held by it hereunder, and Transferor and the predecessor Trustee shall execute and deliver such instruments and do such other things as may reasonably be required for fully and certainly vesting and confirming in the successor trustee all such rights, powers, duties and obligations.
(b) No successor trustee shall accept appointment as provided in this
SECTION 11.8 unless at the time of such acceptance such successor trustee shall
be eligible under SECTION 11.6.
(c) Upon acceptance of appointment by a successor trustee as provided in this Section, such successor trustee shall provide notice of such succession hereunder to all Investor Holders and Servicer shall provide such notice to each Rating Agency and any Enhancement Provider entitled thereto pursuant to the relevant Supplement.
SECTION 11.9. MERGER OR CONSOLIDATION OF TRUSTEE. Any Person into which 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 Trustee shall be a party, or any Person succeeding to the corporate trust business of Trustee, shall be the successor of Trustee hereunder, provided such corporation shall be eligible under the provisions of SECTION 11.6, without the execution or filing of any paper or any further act on the part of any of the parties hereto, anything herein to the contrary notwithstanding.
SECTION 11.10. APPOINTMENT OF CO-TRUSTEE OR SEPARATE TRUSTEE. (a) Notwithstanding any other provisions of this Agreement, at any time, for the purpose of meeting any legal requirements of any jurisdiction in which any part of the Trust may at the time be located, 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 Holders, such title to the Trust, or any part thereof, and, subject to the other provisions of this SECTION 11.10, such powers, duties, obligations, rights and trusts as Trustee may consider necessary or desirable; PROVIDED, that Trustee shall exercise due care in the appointment of any co-trustee. No co-trustee or separate trustee hereunder shall be required to meet the terms of eligibility as a successor trustee under SECTION 11.6 and no notice to Holders of the appointment of any co-trustee or separate trustee shall be required under SECTION 11.8.
(b) Every separate trustee and co-trustee shall, to the extent permitted by law, be appointed and act subject to the following provisions and conditions:
(i) all rights, powers, duties and obligations conferred or imposed upon Trustee shall be conferred or imposed upon and exercised or performed by 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 Trustee joining in such act) except to the extent that under any laws of any jurisdiction in which any particular act or acts are to be performed (whether as Trustee hereunder or as successor to Servicer hereunder) 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 Trustee;
(ii) no trustee hereunder shall be personally liable by reason of any act or omission of any other trustee hereunder; and
(iii) 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 Trustee shall be deemed to have been given to each of the then separate trustees and co-trustees, as effectively as if given to each of them. Every instrument appointing any separate trustee or co-trustee shall refer to this Agreement and the conditions of this ARTICLE XI. Each separate trustee and co-trustee, upon its acceptance of the trusts conferred, shall be vested with the estates or property specified in its instrument of appointment, either jointly with 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, Trustee. Every such instrument shall be filed with Trustee and a copy thereof given to Servicer.
(d) Any separate trustee or co-trustee may at any time constitute Trustee its agent or attorney-in-fact with full power and authority, to the extent not prohibited by law, to do any lawful act under or in respect to this Agreement on its behalf and in its name. If any separate trustee or co-trustee shall die, become incapable of acting, resign or be removed, all of its estates, properties, rights, remedies and trusts shall vest in and be exercised by Trustee, to the extent permitted by law, without the appointment of a new or successor trustee.
SECTION 11.11. TAX RETURN. If the Trust is required to file tax returns, Servicer shall prepare or shall cause to be prepared any tax returns required to be filed by the Trust and shall remit such returns to Trustee for signature at least five days before such returns are due to be filed; Trustee shall promptly sign such returns and deliver such returns after signature to Servicer and such returns shall be filed by Servicer. Servicer in accordance with each Supplement shall also prepare or shall cause to be prepared all tax information required by law to be distributed to Investor Holders. Trustee upon written request, will furnish Servicer with all such information known to Trustee as may be reasonably required in connection with the preparation of all tax returns of the Trust. In no event shall Trustee or Servicer (except as provided in SECTIONS 7.4 or 8.4) be liable for any liabilities, costs or expenses of the Trust or the Investor Holders arising
under any tax law, including Federal, state, local or foreign income or excise taxes or any other tax imposed or measured by income (or any interest or penalty with respect thereto or arising from a failure to comply therewith).
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 Trustee without the possession of any of the Certificates or the production thereof in any proceeding relating thereto, and any such proceeding instituted by 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 Trustee, its agents and counsel, be for the ratable benefit of the Holders in respect of which such judgment has been obtained.
SECTION 11.13. SUITS FOR ENFORCEMENT. If a Servicer Default shall occur and be continuing of which a Responsible Officer of Trustee has received written notice, Trustee, in its discretion may, subject to the provisions of SECTIONS 10.1 and 11.14, proceed to protect and enforce its rights and the rights of the Holders under this Agreement by a suit, action or proceeding in equity or at law or otherwise, whether for the specific performance of any covenant or agreement contained in this Agreement or in aid of the execution of any power granted in this Agreement or for the enforcement of any other legal, equitable or other remedy as Trustee, being advised by counsel, shall deem most effectual to protect and enforce any of the rights of Trustee or the Holders.
SECTION 11.14. RIGHTS OF HOLDERS TO DIRECT TRUSTEE. Holders of Investor Certificates evidencing more than 50% of the aggregate unpaid principal amount of all Investor Certificates (or, with respect to any remedy, trust or power that does not relate to all Series, 50% of the aggregate unpaid principal amount of the Investor Certificates of all Series to which such remedy, trust or power relates) shall have the right to direct the time, method, and place of conducting any proceeding for any remedy available to Trustee, or exercising any trust or power conferred on Trustee relating to such proceeding; PROVIDED that, subject to SECTION 11.1, Trustee shall have the right to decline to follow any such direction if Trustee being advised by counsel determines that the action so directed may not lawfully be taken, or if Trustee in good faith shall, by a Responsible Officer or Responsible Officers of Trustee, determine that the proceedings so directed would be illegal or involve it in personal liability and PROVIDED FURTHER that nothing in this Agreement shall impair the right of Trustee to take any action deemed necessary by Trustee and which is not inconsistent with such direction.
SECTION 11.15. REPRESENTATIONS AND WARRANTIES OF TRUSTEE. Trustee represents and warrants as of each Closing Date that:
(a) Trustee is an Illinois trust company organized, existing and in good standing under the laws of the State of Illinois;
(b) Trustee has full power, authority and right to execute, deliver and perform this Agreement and has taken all necessary action to authorize the execution, delivery and performance by it of this Agreement; and
(c) this Agreement has been duly executed and delivered by Trustee and is a binding obligation of Trustee enforceable against Trustee in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws now or hereafter in effect affecting the enforcement of creditors' rights in general and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity).
SECTION 11.16. MAINTENANCE OF OFFICE OR AGENCY. Trustee will maintain at its expense an office or agency (the "CORPORATE TRUST OFFICE") where notices and demands to or upon Trustee in respect of the Certificates and this Agreement may be served in Chicago, Illinois, in the case of Registered Certificates and Holders thereof. The Corporate Trust Office shall initially be located at 311 West Monroe Street, 12th Floor, Chicago, Illinois 60606, Attention Indenture Trust Administration (facsimile No. (312) 461-3525). Trustee will give prompt notice to Servicer and to Investor Holders of any change in the location of the Certificate Register or any such office or agency.
SECTION 11.17. CONFIDENTIALITY. Information provided by the Credit Card Originator or Transferor to Trustee related to the transaction effected hereunder, including all information related to the Obligors with respect to the Receivables, and any computer software provided to Trustee in connection with the transaction effected hereunder or under any Supplement, in each case whether in the form of documents, reports, lists, tapes, discs or any other form, shall be "CONFIDENTIAL INFORMATION." Trustee and its agents, representatives or employees shall at all times maintain the confidentiality of all Confidential Information and shall not, without the prior written consent of the Credit Card Originator or Transferor, as applicable, disclose to third parties (including Holders) or use such information to compete or assist any other Person in competing with the Credit Card Originator or Transferor or in any manner whatsoever, in whole or in part, except as expressly permitted under this Agreement or under any Supplement or as required to fulfill an obligation of Trustee under this Agreement or under any Supplement, in which case such Confidential Information shall be revealed only to the extent expressly permitted or only to Trustee's agents, representatives and employees who need to know such Confidential Information to the extent required for the purpose of fulfilling an obligation of Trustee under this Agreement or under any Supplement. Notwithstanding the above, Confidential Information may be disclosed to the extent required by law, statute, rule, regulation or legal process (including any subpoena, civil investigative demand or similar demand or request of any court, regulatory authority, arbitrator or arbitration to which the Trustee or an affiliate or an officer, director, employee or shareholder thereof is a party), provided that Trustee gives prompt written notice to the Credit Card Originator or Transferor, as applicable, of the nature and scope of such disclosure. Notwithstanding anything herein to the contrary, the foregoing shall not be construed to prohibit (i) disclosure of any and all information that is or become publicly known, or information obtained by the Trustee from sources other than the Servicer or the Transferor, (ii) disclosure of any and all information (A) to any government agency or regulatory body having or claiming authority to regulate or oversee any aspects of the Trustee's business or that of its affiliates, (B) in any preliminary or final offering circular, registration statement or contract or other document pertaining to the transactions contemplated herein approved in advance by the Servicer or the Transferor or (C) to any affiliate, independent or internal auditor, or attorney of the Trustee having a need to know the same, provided that the
Trustee advises such recipient of the confidential nature of the information being disclosed, or (iii) any other disclosure authorized by the Servicer or the Transferor.
ARTICLE XII TERMINATION
SECTION 12.1. TERMINATION OF TRUST. The Trust and the respective obligations and responsibilities of Transferor, Servicer and Trustee created hereby (other than the obligation of Trustee to make payments to Investor Holders as hereinafter set forth) shall terminate, except with respect to the duties described in SECTIONS 7.4, 8.4 and 12.2(b), upon the earlier of (i) January 1, 2021, (ii) the day following the Distribution Date on which the Invested Amount for each Series is zero (PROVIDED that Transferor has delivered a written notice to Trustee electing to terminate the Trust) and (iii) the date provided in SECTION 9.2.
SECTION 12.2. FINAL DISTRIBUTION. (a) Servicer shall give Trustee at least 30 days prior notice of the Distribution Date on which the Investor Holders 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 2.6, 9.2 or 10.1, notice of such Distribution Date promptly after Servicer has determined that a final distribution will occur, if such determination is made less than 30 days prior to such Distribution Date). Such notice shall be accompanied by an Officer's Certificate setting forth the information specified in SECTION 3.5 covering the period during the then current Servicer fiscal 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 Holders, Trustee shall provide notice to Investor Holders 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). Trustee shall give such notice to the Transfer Agent and Registrar and the Paying Agent at the time such notice is given to Investor Holders.
(b) Notwithstanding a final distribution to the Investor Holders of any Series or Class (or the termination of the Trust), except as otherwise provided in this paragraph, all funds then on deposit in the Collection Account, the Excess Funding Account and any Series Account allocated to such Investor Holders shall continue to be held in trust for the benefit of such Investor Holders and the Paying Agent or Trustee shall pay such funds to such Investor Holders upon surrender of their Investor Certificates (and any excess shall be paid in accordance with any relevant Enhancement Agreement). If all such Investor Holders shall not surrender their Investor Certificates for cancellation within six months after the date specified in the notice from Trustee described in PARAGRAPH (a), Trustee shall give a second notice to the remaining such Investor Holders 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, Trustee may take appropriate steps, or may appoint an agent to take appropriate steps, to contact the remaining such Investor Holders 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 Holders. Trustee and the Paying Agent shall pay to Transferor any moneys held by them for the payment of principal or interest that remains unclaimed for two years. After payment to Transferor, Investor Holders entitled to the money must look to Transferor for payment as general creditors unless an applicable abandoned property law designates another Person.
(c) If the Invested Amount with respect to any Series is greater than zero on its Series Termination Date or such earlier date as is specified in the related Supplement (after giving effect to deposits and distributions otherwise to be made on such date), Trustee will sell or cause to be sold on such Series Termination Date, in accordance with the procedures and subject to the conditions described in such Supplement, Principal Receivables and the related Finance Charge Receivables (or, if a Tax Opinion is obtained, interests therein) in an amount up to 110% of the Invested Amount with respect to such Series on such date (after giving effect to such deposits and distributions; PROVIDED that in no event shall such amount exceed an amount of Principal Receivables (and all associated Finance Charge Receivables) equal to the sum of (i) the product of (A) Transferor Percentage, (B) the aggregate outstanding Principal Receivables, and (C) a fraction the numerator of which is the related Investor Percentage of Collections of Finance Charge Receivables and the denominator of which is the sum of all Investor Percentages with respect to Collections of Finance Charge Receivables of all Series outstanding and (ii) the Invested Amount of such Series). The proceeds from any such sale shall be allocated and distributed in accordance with the applicable Supplement.
SECTION 12.3. TRANSFEROR'S TERMINATION RIGHTS. Upon the termination of the Trust pursuant to SECTION 12.1, Trustee shall assign and convey to the holder of the Transferor Interest or its designee, without recourse, representation or warranty, all right, title and interest of the Trust in the Receivables, whether then existing or thereafter created, all moneys due or to become due and all amounts received with respect thereto and all proceeds thereof, except for amounts held by Trustee pursuant to SECTION 12.2(b). Trustee shall execute and deliver such instruments of transfer and assignment, in each case without recourse, as shall be reasonably requested by Transferor to vest in Transferor or its designee all right, title and interest which the Trust had in the Receivables and such other related assets.
ARTICLE XIII MISCELLANEOUS PROVISIONS
SECTION 13.1. AMENDMENT; WAIVER OF PAST DEFAULTS. (a) This Agreement or
any Supplement may be amended from time to time (including in connection with
(i) adding covenants, restrictions or conditions of Transferor, such further
covenants, restrictions or conditions as its Board of Directors and Trustee
shall consider to be for the benefit or protection of the Investor Holders, and
to make the occurrence, or the occurrence and continuance, of a default in any
of such additional covenants, restrictions or conditions a default or Early
Amortization Event permitting the enforcement of all or any of the several
remedies provided in this Agreement as herein set forth; PROVIDED, HOWEVER, that
in respect of any such additional covenant, restriction or condition such
amendment may provide for a particular period of grace after default or may
provide for an immediate enforcement upon such default or may limit the remedies
available to Trustee upon such default, (ii) curing any ambiguity or correcting
or supplementing any provision contained herein or in any Supplement which may
be defective or inconsistent with any other provision contained herein or in any
Supplement or to surrender any
right or power conferred upon Transferor, (iii) the issuance of a Supplemental Interest, (iv) the addition of a Participation Interest or receivables arising in VISA, MasterCard or any other type of open end revolving credit card account to the Trust, (v) the assumption by another entity, in accordance with the provisions of this Agreement, of Transferor's obligations hereunder, or (vi) the provision of additional Enhancement for the benefit of Holders of any Series) by Servicer, Transferor and Trustee without the consent of such Holders as provided for in the applicable Supplement, PROVIDED that (x) Transferor shall have delivered to Trustee an Officer's Certificate to the effect that Transferor reasonably believes that such action shall not adversely affect in any material respect the interests of any Investor Holder, (y) the Rating Agency Condition shall have been satisfied with respect to any such amendment and (z) a Tax Opinion is delivered in connection with any such amendment. The designation of additional or substitute Transferors or additional Credit Card Originators pursuant to SECTION 2.11 or 2.12 shall be subject to this SECTION 13.1 only to the extent that the supplement to this Agreement providing for such designation amends any of the terms of this Agreement.
(b) This Agreement or any Supplement may also be amended from time to time by Servicer, Transferor and Trustee, with the consent of the Holders of Investor Certificates (acting for themselves or through any designated agents, as provided for in any applicable Supplement) evidencing not less than 66-2/3% of the aggregate unpaid principal amount of the Investor Certificates of all adversely affected Series and, unless the Rating Agency Condition is satisfied, of each Class of each such Series, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this Agreement or any Supplement or of modifying in any manner the rights of the Holders; PROVIDED, HOWEVER, that no such amendment shall (i) reduce in any manner the amount of or delay the timing of any distributions to be made to any Investor Holders or deposits of amounts to be so distributed or the amount available under any Enhancement without the consent of each affected Holder (provided that any amendment of the terms of an Early Amortization Event shall not be deemed to be within the scope of this CLAUSE (i)), (ii) change the definition of or the manner of calculating the interest of any Investor Holder without the consent of each affected Investor Holder (acting for themselves or through any designated agents, as provided for in any applicable Supplement) or (iii) reduce the aforesaid percentage required to consent to any such amendment without the consent of each Investor Holder (acting for themselves or through any designated agents, as provided for in any applicable Supplement) and, unless the Rating Agency Condition is satisfied, of each Class of each such Series. Any amendment to be effected pursuant to this paragraph shall be deemed to adversely affect all outstanding Series, other than any Series with respect to which such action shall not, as evidenced by an Opinion of Counsel for Transferor, addressed and delivered to Trustee, adversely affect in any material respect the interests of any Investor Holder of such Series. Trustee may, but shall not be obligated to, enter into any such amendment which affects Trustee's rights, duties or immunities under this Agreement or otherwise.
(c) Promptly after the execution of any such amendment or consent (other than an amendment pursuant to PARAGRAPH (a)), Trustee shall furnish notification of the substance of such amendment to each Investor Holder; and Servicer shall furnish prior notification of the substance of such amendment to (i) each Rating Agency and (ii) each Enhancement Provider, if any, entitled thereto pursuant to the relevant Supplement.
(d) It shall not be necessary for the consent of Investor Holders 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 Holders shall be subject to such reasonable requirements as Trustee may prescribe.
(e) Any Supplement executed in accordance with the provisions of SECTION 6.3 shall not be considered an amendment to this Agreement for the purposes of this Section.
(f) 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 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 Holders, waive any default by Transferor or Servicer in the performance of their obligations hereunder and its consequences, except the failure to make any distributions required to be made to Investor Holders 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.
SECTION 13.2. PROTECTION OF RIGHT, TITLE AND INTEREST TO TRUST. (a) Transferor shall cause this Agreement, all amendments and supplements hereto and all financing statements and continuation statements and any other necessary documents covering the Holders, and 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 Holders and Trustee hereunder to all property comprising the Trust Assets. Transferor shall deliver to 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.
(b) Within 30 days after Transferor makes any change in its name, identity or corporate structure which would make any financing statement or continuation statement filed in accordance with PARAGRAPH (a) seriously misleading within the meaning of Section 9-402(7) (or any comparable provision) of the UCC, Transferor shall give Trustee notice of any such change and shall file such financing statements or amendments as may be necessary to continue the perfection of the Trust's security interest in the Receivables and the proceeds thereof.
(c) Transferor and Servicer will give Trustee prompt notice of any relocation of any office from which it services Receivables or keeps records concerning the Receivables or of its principal executive office and whether, as a result of such relocation, the applicable provisions of the UCC would require the filing of any amendment of any previously filed financing or continuation statement or of any new financing statement and shall file such financing statements or amendments as may be necessary to perfect or to continue the perfection of the Trust's security interest in the Receivables and the proceeds thereof. Transferor and Servicer will at all
times maintain each office from which it services Receivables and its principal executive offices within the United States.
(d) Transferor will deliver to Trustee and any Enhancement Provider
entitled thereto pursuant to the relevant Supplement: (i) upon the execution and
delivery of each amendment of this Agreement or any Supplement, an Opinion of
Counsel to the effect specified in EXHIBIT E-1; (ii) on each Addition Date on
which any Supplemental Accounts are to be designated as Accounts pursuant to
SECTION 2.8(a) or (b), an Opinion of Counsel to the effect specified in EXHIBIT
E-2, and on each Addition Date on which any Participation Interests are to be
included in the Trust pursuant to SECTION 2.8(a) or (b), an Opinion of Counsel
covering the same substantive legal issues addressed by EXHIBIT E-2 but
conformed to the extent appropriate to relate to Participation Interests; and
(iii) on or before March 31 of each year, beginning with March 31, 1996, an
Opinion of Counsel to the effect specified in EXHIBIT E-2.
SECTION 13.3. LIMITATION ON RIGHTS OF HOLDERS. (a) The death or incapacity of any Holder shall not operate to terminate this Agreement or the Trust, nor shall such death or incapacity entitle such Holders' 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 Holder 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 Holders from time to time as partners or members of an association, nor shall any Investor Holder be under any liability to any third person by reason of any action by the parties to this Agreement pursuant to any provision hereof.
(c) No Investor Holder 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 Holder 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 which such action, suit or proceeding relates) shall have made written request to Trustee to institute such action, suit or proceeding in its own name as Trustee hereunder and shall have offered to Trustee such reasonable indemnity as it may require against the costs, expenses and liabilities to be incurred therein or thereby, and Trustee, for 60 days after its receipt of 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 Holder with every other Investor Holder and Trustee, that no one or more Investor Holders 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 Holders of any other of the Investor Certificates, or to obtain or seek to obtain priority over or preference to any other Investor Holder, 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 Holders except as otherwise expressly provided in this Agreement. For the protection and enforcement of the
provisions of this Section, each and every Investor Holder and Trustee shall be entitled to such relief as can be given either at law or in equity.
SECTION 13.4. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
SECTION 13.5. NOTICES, PAYMENTS. (a) All demands notices, instructions, directions, consents and communications (collectively, "NOTICES") under this Agreement shall be in writing and shall be deemed to have been duly given if personally delivered at, mailed by registered mail, return receipt requested, or sent by facsimile transmission (i) in the case of Servicer, to WFN, 800 Techcenter Drive, Gahanna, Ohio 43230, Attention: Robert Armiak (facsimile no. 614/729-4899), (ii) in the case of Trustee, BNY Midwest Trust Company, 2 North LaSalle Street, Suite 1020, Chicago, Illinois 60602, Attention Structured Finance Services (facsimile No. (312) 461-3525] , (iii) in the case of Transferor, to WFN Credit Company, LLC, 220 West Schrock Road, Westerville, Ohio 43801, (iv) in the case of the Paying Agent or the Transfer Agent and Registrar, to Trustee at the address above and (v) 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 Holder receives such Notice. In addition, (i) 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 Holders shall be published in an Authorized Newspaper of general circulation in Luxembourg within the time period prescribed in this Agreement and (ii) 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 Holders of such Series or Class shall be published in an Authorized Newspaper within the time period prescribed in this Agreement.
SECTION 13.6. 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 Securities Act, each of Transferor, Trustee, Servicer and any Enhancement Provider agree to cooperate with each other to provide to any Investor Holders of such Series or Class and to any prospective purchaser of Certificates designated by such Investor Holder, upon the request of such Investor Holder 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 Securities Act.
SECTION 13.7. 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 Holders.
SECTION 13.8. CERTIFICATES NONASSESSABLE AND FULLY PAID. It is the intention of the parties to this Agreement that the Holders shall not be personally liable for obligations of the Trust, that the interests in the Trust represented by the Certificates shall be nonassessable for any losses or expenses of the Trust or for any reason whatsoever and that Certificates upon authentication thereof by Trustee pursuant to SECTION 6.2 are and shall be deemed fully paid.
SECTION 13.9. FURTHER ASSURANCES. Transferor and 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 Trustee more fully to effect the purposes of this Agreement, including the execution of any financing statements or continuation statements relating to the Receivables for filing under the provisions of the UCC of any applicable jurisdiction.
SECTION 13.10. NONPETITION COVENANT. Notwithstanding any prior termination of this Agreement, Servicer, Trustee, each Holder and each Enhancement Provider, if any, and each Holder of a Supplemental Interest and (with respect to the Trust only) the Transferor shall not, (i) prior to the date which is one year and one day after the last day on which any Investor Certificates shall have been outstanding, with respect to the Trust or (ii) at any time, with respect to the Trust or the Transferor, petition or otherwise invoke or cause the Trust or the Transferor to invoke the process of any Governmental Authority for the purpose of commencing or sustaining a case against the Trust or the Transferor under any Federal or state bankruptcy, insolvency or similar law or appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official of the Trust or the Transferor or any substantial part of its property or ordering the winding-up or liquidation of the affairs of the Trust or the Transferor; PROVIDED, HOWEVER, that nothing herein shall prohibit the Trustee from filing proofs of claim or otherwise participating in such proceedings instituted by any other person.
SECTION 13.11. NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no delay in exercising, on the part of Trustee or the Holders, 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 13.12. 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 13.13. THIRD-PARTY BENEFICIARIES. This Agreement will inure to the benefit of and be binding upon the parties hereto, the Holders, any Enhancement Provider (to the extent provided in this Agreement and the related Supplement) and their respective successors and permitted assigns. Except as otherwise expressly provided in this Agreement (including SECTION 7.4), no other Person will have any right or obligation hereunder.
SECTION 13.14. ACTIONS BY HOLDERS. (a) Wherever in this Agreement a provision is made that an action may be taken or a Notice given by Holders, such action or Notice may be taken or given by any Holder, unless such provision requires a specific percentage of Holders.
(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 Trustee or Servicer in reliance thereon, whether or not notation of such action is made upon such Certificate.
SECTION 13.15. MERGER AND INTEGRATION. Except as specifically stated otherwise herein, this Agreement 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.
IN WITNESS WHEREOF, Transferor, Servicer and Trustee have caused this Agreement to be duly executed by their respective officers as of the day and year first above written.
WFN CREDIT COMPANY, LLC,
as Transferor
By /s/ Robert P. Armiak ----------------------------------- Name: Robert P. Armiak Title: Vice President and Treasurer |
WORLD FINANCIAL NETWORK
NATIONAL BANK, as Servicer
By /s/ Robert P. Armiak ----------------------------------- Name: Robert P. Armiak Title: Vice President and Treasurer |
BNY MIDWEST TRUST COMPANY ,
not in its individual capacity,
but solely as Trustee
By /s/ Eric Lindahl ----------------------------------- Name: Eric Lindahl Title: Assistant Vice President |
EXHIBIT A
FORM OF ASSIGNMENT OF RECEIVABLES IN SUPPLEMENTAL ACCOUNTS
(As required by SECTION 2.8 of
the Pooling and Servicing Agreement)
ASSIGNMENT No. _______ OF RECEIVABLES IN SUPPLEMENTAL ACCOUNTS dated as of _____________, ___(1) by and among WFN CREDIT COMPANY, LLC, a Delaware limited liability company, as Transferor ("TRANSFEROR"), WORLD FINANCIAL NETWORK NATIONAL BANK, a national banking association, as Servicer ("SERVICER"), and BNY MIDWEST TRUST COMPANY (successor to the corporate trust administration of Harris Trust and Savings Bank (successor to The Bank of New York), an Illinois trust company ("TRUSTEE"), pursuant to the Second Amended and Restated Pooling and Servicing Agreement referred to below.
WITNESSETH
WHEREAS Transferor, Servicer and Trustee are parties to the Second Amended and Restated Pooling and Servicing Agreement dated as of August 1, 2001 (as may be amended and supplemented from time to time, the "AGREEMENT");
WHEREAS, pursuant to the Agreement, Transferor wishes to designate Supplemental Accounts owned by the Credit Card Originator to be included as Accounts and to convey the Receivables of such Supplemental Accounts, whether now existing or hereafter created, to the Trust as part of the corpus of the Trust (as each such term is defined in the Agreement); and
WHEREAS Trustee is willing to accept such designation and conveyance subject to the terms and conditions hereof;
NOW, THEREFORE, Transferor, Servicer and Trustee hereby agree as follows:
1. DEFINED TERMS. All capitalized terms used herein shall have the meanings ascribed to them in the Agreement unless otherwise defined herein.
"Addition Date" means, with respect to the Supplemental Accounts designated hereby, ________, ____.
"Addition Cut Off Date" means, with respect to the Supplemental Accounts designated hereby, ________, ____.
(1) To be dated as of the applicable Addition Date.
Exhibit A, Page 1
2. DESIGNATION OF SUPPLEMENTAL ACCOUNTS. On or before the Document Delivery Date, Transferor will deliver to Trustee an Account Schedule containing a true and complete schedule identifying all such Supplemental Accounts specifying for each such Account, as of the Addition Cut Off Date, its account number, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables outstanding in such Account, which Account Schedule shall supplement any other Account Schedule previously delivered to Trustee pursuant to the Agreement.
3. CONVEYANCE OF RECEIVABLES. Transferor does hereby transfer, assign, set over and otherwise convey to the Trust, for the benefit of the Holders, all its right, title and interest in, to and under the Receivables of such Supplemental Accounts existing at the close of business on the Addition Date and thereafter created from time to time until the termination of the Trust, all monies due or to become due and all amounts received with respect thereto and all proceeds thereof. The foregoing does not constitute and is not intended to result in the creation or assumption by the Trust, Trustee, any Investor Holder or any Enhancement Provider of any obligation of Servicer, Transferor, the Credit Card Originator or any other Person in connection with the Accounts, the Receivables or under any agreement or instrument relating thereto, including any obligation to Obligors, merchant banks, merchants clearance systems or insurers.
Transferor agrees to record and file, at its own expense, financing statements (and continuation statements when applicable) with respect to the Receivables now in Supplemental 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 assignment of such Receivables to the Trust, and to deliver a file-stamped copy of each such financing statement or other evidence of such filing to Trustee on or prior to the Addition Date. Trustee shall be under no obligation whatsoever to file or maintain such financing or continuation statements or to make any other filing under the UCC in connection with such assignment.
In connection with such assignment, Transferor further agrees, at its own expense, on or prior to the date of this Assignment, to cause the Credit Card Originator to indicate in the appropriate computer files that Receivables created in connection with the Supplemental Accounts and designated hereby have been conveyed to the Trust pursuant to the Agreement and this Assignment for the benefit of the Holders.
Transferor does hereby grant to Trustee a security interest in all of its right, title and interest in and to the Receivables now existing and hereafter created in the Supplemental Accounts, all monies due or to become due and all amounts received with respect thereto and all proceeds thereof. This Assignment constitutes a security agreement under the UCC.
4. ACCEPTANCE BY TRUSTEE. Trustee hereby acknowledges its acceptance on behalf of the Trust of all right, title and interest to the property, now existing and hereafter created, conveyed to the Trust pursuant to SECTION 3(a) of this Assignment, and declares that it shall maintain such right, title and interest, upon the trust set forth in the Agreement for the benefit of all Holders. Trustee further acknowledges that, prior to or simultaneously with the execution and delivery of this Assignment, Transferor delivered to Trustee the Account Schedule described in SECTION 2 of this Assignment.
Exhibit A, Page 2
5. REPRESENTATIONS AND WARRANTIES OF TRANSFEROR. Transferor hereby represents and warrants to 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 Transferor enforceable against 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. Each Supplemental Account designated hereby is an Eligible Account;
(c) INSOLVENCY. As of each of the Addition Cut Off Date and the Addition Date, no Insolvency Event with respect to the Credit Card Originator or Transferor has occurred and the transfer by Transferor of Receivables arising in the Supplemental Accounts to the Trust has not been made in contemplation of the occurrence thereof;
(d) EARLY AMORTIZATION EVENT. Transferor reasonably believes that (A) the addition of the Receivables arising in the Supplemental Accounts will not, based on the facts known to Transferor, then or thereafter cause an Early Amortization Event to occur with respect to any Series and (B) no selection procedure was utilized by Transferor which would result in the selection of Supplemental Accounts (from among the available Eligible Accounts owned by the Credit Card Originator) that would be materially less favorable to the interests of the Investor Holders of any Series as of the Addition Date than a random selection;
(e) SECURITY INTEREST. Either this Assignment constitutes a valid transfer and assignment to the Trust of all right, title and interest of Transferor in the Receivables and other Trust Assets conveyed to the Trust by Transferor and all monies due or to become due and all amounts received with respect thereto and the proceeds thereof, or this Assignment constitutes a grant of a security interest in such property to the Trustee, for the benefit of the Investor Holders, which, in the case of existing Receivables and the proceeds thereof, is enforceable upon execution and delivery of this Assignment, and which will be enforceable with respect to such Receivables hereafter created and the proceeds thereof upon such creation. Upon the filing of the financing statements described in SECTION 3 of this Assignment and, in the case of the Receivables hereafter created and the proceeds thereof, upon the creation thereof, the Trust shall have a first priority security interest in such property except for Liens permitted under SECTION 2.7(b) of the Agreement;
(f) NO CONFLICT. The execution and delivery by Transferor of this Assignment, the performance of the transactions contemplated by this Assignment and the fulfillment of the terms hereof applicable to Transferor, will not conflict with or violate any
Exhibit A, Page 3
Requirements of Law applicable to 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 Transferor is a party or by which it or its properties are bound;
(g) NO PROCEEDINGS. There are no proceedings or investigations pending or, to the best knowledge of Transferor, threatened against 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 Transferor, would materially and adversely affect the performance by Transferor of its obligations under this Assignment, (iv) seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Assignment or (v) seeking to affect adversely the income tax attributes of the Trust under the Federal, or applicable state income or franchise tax systems; and
(h) ALL CONSENTS. All authorizations, consents, orders or approvals or other actions of any Person or of any court or other governmental authority required to be obtained by Transferor in connection with the execution and delivery of this Assignment by Transferor and the performance of the transactions contemplated by this Assignment by Transferor, have been obtained.
6. RATIFICATION OF AGREEMENT. As supplemented by this Assignment, the Agreement is in all respects ratified and confirmed and the Agreement as so supplemented by this Assignment shall be read, taken and construed as one and the same instrument.
7. COUNTERPARTS. This Assignment may be executed in two or more counterparts, and by different parties on separate counterparts, each of which shall be an original, but all of which shall constitute one and the same instrument.
8. GOVERNING LAW. THIS ASSIGNMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Exhibit A, Page 4
IN WITNESS WHEREOF, Transferor, Servicer and Trustee have caused this Assignment to be duly executed by their respective officers as of the day and year first above written.
WFN CREDIT COMPANY, LLC,
as Transferor
By _____________________________________
Name:Robert P. Armiak
Title: Vice President and Treasurer
WORLD FINANCIAL NETWORK
NATIONAL BANK,
as Servicer,
By _____________________________________
Name:Robert P. Armiak
Title: Vice President and Treasurer
BNY MIDWEST TRUST COMPANY,
not in its individual capacity, but
solely as Trustee,
By _____________________________________
Name:Eric Lindahl
Title: Assistant Vice President
Exhibit A, Page 5
EXHIBIT B
FORM OF REASSIGNMENT OF RECEIVABLES IN REMOVED ACCOUNTS
(As required by SECTION 2.9 of
the Pooling and Servicing Agreement)
REASSIGNMENT No. _______ OF RECEIVABLES dated as of _________, ____(1) by and among WFN CREDIT COMPANY, LLC, a Delaware limited liability company, as Transferor ("TRANSFEROR"), WORLD FINANCIAL NETWORK NATIONAL BANK, a national banking association, as Servicer ("SERVICER"), and BNY MIDWEST TRUST COMPANY (successor to the corporate trust administration of Harris Trust and Savings Bank (as successor to The Bank of New York), an Illinois trust company ("TRUSTEE"), pursuant to the Second Amended and Restated Pooling and Servicing Agreement referred to below.
WITNESSETH:
WHEREAS Transferor, Servicer and Trustee are parties to the Second Amended and Restated Pooling and Servicing Agreement dated as of August 1, 2001 (as may be amended and supplemented from time to time, the "AGREEMENT");
WHEREAS pursuant to the Agreement, Transferor wishes to remove from the Trust all Receivables in certain designated Accounts owned by the Credit Card Originator (the "REMOVED ACCOUNTS") and to cause Trustee to reconvey the Receivables of such Removed Accounts, whether now existing or hereafter created, from the Trust to Transferor; and
WHEREAS Trustee is willing to accept such designation and to reconvey the Receivables in the Removed Accounts subject to the terms and conditions hereof;
NOW, THEREFORE, Transferor, Servicer and 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" means, with respect to the Removed Accounts designated hereby, ____________, _____.
"REMOVAL NOTICE DATE" means, with respect to the Removed Accounts, ___________, ___.
2. DESIGNATION OF REMOVED ACCOUNTS. On or before the date that is 10 Business Days after the Removal Date, Transferor will deliver to Trustee an Account Schedule identifying all Accounts the Receivables of which are being removed from the Trust, specifying for each such
(1) To be dated as of the Removal Date.
Exhibit B, Page 1
Account, as of the Removal Notice Date, its account number, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables in such Account, which Account Schedule shall supplement any Account Schedule previously delivered to Trustee pursuant to the Agreement.
3. CONVEYANCE OF RECEIVABLES. (a) Trustee does hereby transfer, assign, set over and otherwise convey to Transferor, without representation, warranty or recourse, on and after the Removal Date, all right, title and interest of the Trust in, to and under the Receivables existing at the close of business on the Removal Date and thereafter created from time to time in the Removed Accounts designated hereby, all monies due or to become due and all amounts received with respect thereto and all proceeds thereof.
(b) In connection with such transfer, Trustee agrees to execute and deliver to Transferor on or prior to the date this Reassignment is delivered, applicable termination statements with respect to the Receivables existing at the close of business on the Removal Date and thereafter created from time to time in the Removed Accounts reassigned hereby and the proceeds thereof evidencing the release by the Trust of its interest in the Receivables in the Removed Accounts, and meeting the requirements of applicable state law, in such manner and such jurisdictions as are necessary to terminate such interest.
4. REPRESENTATIONS AND WARRANTIES OF TRANSFEROR. Transferor hereby represents and warrants to 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 Transferor enforceable against 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) EARLY AMORTIZATION EVENT. Transferor reasonably believes that (A) the removal of the Receivables existing in the Removed Accounts will not, based on the facts known to Transferor, then or thereafter cause an Early Amortization Event to occur with respect to any Series and (B) no selection procedure was utilized by Transferor which would result in a selection of Removed Accounts from among any pools of Accounts of a similar type that would be materially adverse to the interests of the Investor Holders of any Series as of the Removal Date; and
(c) LIST OF REMOVED ACCOUNTS. The list of Removed Accounts delivered pursuant to SECTION 2.9(a)(ii) of the Agreement, as of the Removal Date, is true and complete in all material respects.
(d) DEFAULTED RECEIVABLES. No selection procedure was utilized by Transferor with the intent to include a disproportionately higher level of Defaulted Receivables in the Removed Accounts than exist in the Accounts or to remove Accounts for the intended purpose of mitigating losses to the Trust.
Exhibit B, Page 2
(e) RECEIVABLES TESTS. The aggregate Principal Receivables in the Removed Accounts did not exceed the lesser of (i) the excess of the Transferor Amount over the Minimum Transferor Amount or (ii) the excess of the aggregate amount of Principal Receivables plus amounts on deposit in the Excess Funding Account over the Required Principal Balance, all measured as of the end of the most recently ended Monthly Period.
(f) INVESTED AMOUNTS. Such removal shall not cause a decrease in the sum of the Invested Amounts for all outstanding Series.
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.
Exhibit B, Page 3
IN WITNESS WHEREOF, Transferor, Servicer and Trustee have caused this Reassignment to be duly executed by their respective officers as of the day and year first above written.
WFN CREDIT COMPANY, LLC,
as Transferor
By _____________________________________
Name:
Title:
WORLD FINANCIAL NETWORK
NATIONAL BANK,
as Servicer,
By _____________________________________
Name:
Title:
BNY MIDWEST TRUST COMPANY,
not in its individual capacity,
but solely as Trustee,
By _____________________________________
Name:
Title:
Exhibit B, Page 4
EXHIBIT C
FORM OF ANNUAL SERVICER'S CERTIFICATE
(To be delivered on or before the
90th day following the end of the fiscal year of Transferor beginning with December 31, 1996, pursuant to SECTION 3.5 of the Pooling and Servicing Agreement referred to below)
WORLD FINANCIAL NETWORK NATIONAL BANK
WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST
The undersigned, a duly authorized representative of World Financial Network National Bank, as Servicer ("WFN"), pursuant to the Second Amendment and Restated Pooling and Servicing Agreement dated as of August 1, 2001 (as may be amended and supplemented from time to time, the "AGREEMENT"), among WFN Credit Company. LLC, as Transferor, WFN, as Servicer, and BNY Midwest Trust Company (successor to the corporate trust administration of Harris Trust and Savings Bank, successor to The Bank of New York), as Trustee, does hereby certify that:
1. WFN is, as of the date hereof, 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 Trustee.
3. A review of the activities of Servicer during the fiscal year ended __________, ____, and of its performance under the Agreement was conducted under my supervision.
4. Based on such review, 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.
5. The following is a description of each default in the performance of Servicer's obligations under the provisions of the Agreement known to me to have been made by Servicer during the fiscal year ended ___________, _____, which sets forth in detail (i) the nature of each such default, (ii) the action taken by Servicer, if any, to remedy each such default and (iii) the current status of each such default: if applicable, insert "None."
Exhibit C, Page 1
IN WITNESS WHEREOF, the undersigned has duly executed this Certificate this ______ day of ____________, 20___.
WORLD FINANCIAL NETWORK
NATIONAL BANK,
as Servicer,
By _____________________________________
Name:
Title:
Exhibit C, Page 2
EXHIBIT D-1
THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES 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 SECURITIES ACT AND ANY APPLICABLE PROVISIONS OF ANY STATE BLUE SKY OR SECURITIES LAWS OR PURSUANT TO AN AVAILABLE EXEMPTION FROM SUCH REGISTRATION PROVISIONS. THE TRANSFER OF THIS CERTIFICATE IS SUBJECT TO CERTAIN CONDITIONS SET FORTH IN THE POOLING AND SERVICING AGREEMENT REFERRED TO HEREIN.
Exhibit D-1
EXHIBIT D-2
FORM OF UNDERTAKING LETTER
Date
Trustee Bank
Attention:
World Financial Network
National Bank
800 Techcenter Drive
Gahanna, Ohio 43230
Attention:
Re: Purchase of $___________(1) principal amount of World Financial Network Credit Card Master Trust, Class __, __% Floating Rate Asset Backed Certificates, Series
Dear Sirs:
In connection with our purchase of the above-referenced Asset Backed Certificates (the "CERTIFICATES") we confirm that:
(i) we understand that the Certificates are not being registered under the Securities Act of 1933, as amended (the "SECURITIES ACT"), and are being sold to us in a transaction that is exempt from the registration requirements of the Securities Act;
(ii) any information we desire concerning the Certificates or any other matter relevant to our decision to purchase the certificates is or has been made available to us;
(iii) we have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of an investment in the Certificates, and we (and any account for which we are purchasing under PARAGRAPH (iv)) 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)) are an "accredited investor" (as such term is defined in Rule 501(a)(1), (2) or (3) of Regulation D under the Securities Act); 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
(1) Not less than $250,000 minimum principal amount.
Exhibit D-2, Page 1
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 Securities Act or an exemption from any registration requirements of that Act and any applicable state securities laws available;
(vi) we agree that if at some future time we wish to dispose of or exchange any of the Certificates (such disposition or exchange not being currently foreseen or contemplated), we will not transfer or exchange any of the Certificates unless
(A) (1) the sale is of at least U.S. $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 Securities 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 Securities Act and, if Transferor, Servicer, 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 Securities Act under Rule 144A under the Securities Act; or
(E) The Certificates are not transferred to any Benefit Plan (as defined below), unless the transferee is an insurance company general account that represents and warrants that at the time of acquisition and throughout its holding of the certificate (a) it is not a service provider to the trust or an affiliate of the foregoing, and would not otherwise be excluded under 29 C.F.R. 2510.3-101(f)(1), and (b) each of the accounts to which such certificate is allocated is an insurance company general account (1) that is eligible for and meets the requirements of Department of Labor Prohibited Transaction Class Exemption 95-60 and (2) of which less than 25% of the assets are (or represent) assets of a Benefit Plan.(2)
(2) This bracketed text should be included only if the Certificate(s) to be purchased include the legend specified on EXHIBIT D-3.
Exhibit D-2, Page 2
(vii) we understand that the Certificates will bear a legend to substantially the following effect:
"THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES 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 SECURITIES 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) UNLESS IT IS AN INSURANCE COMPANY USING THE ASSETS OF ITS GENERAL ACCOUNT AND, AT THE TIME OF ACQUISITION AND THROUGHOUT ITS HOLDING OF THE CERTIFICATE (A) IT IS NOT A SERVICE PROVIDER TO THE TRUST OR AN AFFILIATE OF THE FOREGOING, AND WOULD NOT OTHERWISE BE EXCLUDED UNDER 29 C.F.R. 2510.3-101(f)(1), AND (B) EACH OF THE ACCOUNTS TO WHICH SUCH CERTIFICATE IS ALLOCATED IS AN INSURANCE COMPANY GENERAL ACCOUNT (1) THAT IS ELIGIBLE FOR AND MEETS THE REQUIREMENTS OF DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 AND (2) OF WHICH LESS THAN 25% OF THE ASSETS ARE (OR REPRESENT) ASSETS OF A BENEFIT PLAN."*
The first paragraph of this legend may be removed if Transferor, Servicer, 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" within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (whether or not subject to ERISA and including foreign and governmental plans), any plan, trust or account (including an individual retirement plan) described in Section 4975(e)(1) of the Internal Revenue Code of 1986, as amended, or any collective investment fund, insurance company separate or general account or other entity deemed to hold plan assets of the foregoing by reason of any such employee benefit plan's or other plan's investment in such entity. Capitalized terms used but not defined herein shall have the
* This bracketed text should be included only if the Certificate(s) to be purchased include the legend specified on EXHIBIT D-3.
Exhibit D-2, Page 3
the meanings given to such terms in the Second Amended and Restated Pooling and Servicing Agreement, dated as of [_________], between WFN Credit Company, LLC, as Transferor, World Financial Network National Bank, as Servicer, and BNY Midwest Trust Company (successor to the corporate trust administration of Harris Trust and Savings Bank, successor to The Bank of New York), as Trustee.
Very truly yours,
By: ____________________________________
(Authorized Officer)
Exhibit D-2, Page 4
EXHIBIT D-3
THIS CERTIFICATE MAY NOT BE ACQUIRED BY OR FOR THE ACCOUNT OF A BENEFIT PLAN (AS DEFINED BELOW) UNLESS IT IS AN INSURANCE COMPANY USING THE ASSETS OF ITS GENERAL ACCOUNT AND, AT THE TIME OF ACQUISITION AND THROUGHOUT ITS HOLDING OF THE CERTIFICATE (A) IT IS NOT A SERVICE PROVIDER TO THE TRUST OR AN AFFILIATE OF THE FOREGOING, AND WOULD NOT OTHERWISE BE EXCLUDED UNDER 29 C.F.R. 2510.3-101(f)(1), AND (B) EACH OF THE ACCOUNTS TO WHICH SUCH CERTIFICATE IS ALLOCATED IS AN INSURANCE COMPANY GENERAL ACCOUNT (1) THAT IS ELIGIBLE FOR AND MEETS THE REQUIREMENTS OF DEPARTMENT OF LABOR PROHIBITED TRANSACTION CLASS EXEMPTION 95-60 AND (2) OF WHICH LESS THAN 25% OF THE ASSETS ARE (OR REPRESENT) ASSETS OF A BENEFIT PLAN.(1)
(1) 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" within the meaning of Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended (whether or not subject
to ERISA and including foreign and governmental plans), any plan, trust or
account (including an individual retirement plan) described in Section
4975(e)(1) of the Internal Revenue Code of 1986, as amended, or any
collective investment fund, insurance company separate or general account
or other entity deemed to hold plan assets of the foregoing by reason of
any such employee benefit plan's or other plan's investment in such entity
(each, a "Benefit Plan"), unless the purchaser or transferee is an
insurance company general account that represents and warrants that at the
time of acquisition and throughout its holding of the certificate (a) it
is not a service provider to the trust or an affiliate of the foregoing,
and would not otherwise be excluded under 29 C.F.R. 2510.3-101(f)(1), and
(b) each of the accounts to which such certificate is allocated is an
insurance company general account (1) that is eligible for and meets the
requirements of Department of Labor Prohibited Transaction Class Exemption
95-60 and (2) of which less than 25% of the assets are (or represent)
assets of a Benefit Plan. By accepting and holding this Certificate, the
Holder hereof shall be deemed to have represented and warranted that it is
not, and is not acting on behalf of, a Benefit Plan unless it is an
insurance company meeting the foregoing requirements. By acquiring an
interest in this Certificate, each applicable Certificate Owner shall be
deemed to have represented and warranted that it is not, and is not acting
on behalf of, a Benefit Plan."
By accepting and holding this Certificate, the Holder hereof shall be deemed to have represented and warranted that it is not, and is not acting on behalf of, a Benefit Plan. By acquiring any interest in this Certificate, each applicable Certificate Owner shall be deemed to have represented and warranted that it is not, and is not acting on behalf of, a Benefit Plan.
Exhibit D-3
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 13.2(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 Transferor and Servicer and constitutes the legal, valid and binding agreement of Transferor and Servicer, respectively, enforceable in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other laws from time to time in effect affecting creditors' rights generally or the rights of creditors of national banking associations. The enforceability of the respective obligations of Transferor and Servicer is also subject to general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law)
(ii) The Amendment has been entered into in accordance with the terms and provisions of SECTION 13.1 of the Pooling and Servicing Agreement.
Exhibit E-1
EXHIBIT E-2
FORM OF OPINION OF COUNSEL WITH RESPECT
TO ADDITION OF SUPPLEMENTAL ACCOUNTS
Provisions to be included in
Opinion of Counsel to be
delivered pursuant to
SECTION 13.2(d)(ii) or (iii)
The opinions set forth below may be subject to appropriate qualifications, assumptions, limitations and exceptions. PARAGRAPHS 1-3 are not required if the opinion is being delivered solely under SECTION 13.2(d)(iii).
1. The Receivables arising in such Supplemental Accounts constitute accounts.
2. The Pooling and Servicing Agreement creates in favor of the Trust a security interest in Transferor's rights in the Receivables in such Supplemental Accounts and the proceeds thereof (the "SPECIFIED ASSETS").
3. The security interest in the Specified Assets created by the Pooling and Servicing Agreement will be perfected by the filing of the Financing Statements as described and defined in such opinion. Based solely upon our review of the UCC Searches as described and defined in such opinion, we hereby confirm to you that no Person other than Trustee has filed any financing statement with the Filing Offices as described and defined in such opinion that covers the Specified Assets and that would have priority over the security interest, if any, of the Trustee by virtue of such filing.
4. No further filings or actions are required under the UCC or other Ohio law prior to _______, ____ , in order to maintain the perfection and priority of the security interest created by the Pooling and Servicing Agreement in favor of the Trust in Transferor's rights in the Receivables and the proceeds thereof.
Exhibit 4.7
WFN CREDIT COMPANY, LLC,
Transferor,
WORLD FINANCIAL NETWORK NATIONAL BANK,
Servicer,
and
BNY MIDWEST TRUST COMPANY,
Trustee
on behalf of the Collateral Certificateholder
COLLATERAL SERIES SUPPLEMENT
Dated as of August 21, 2001
to
SECOND AMENDED AND RESTATED POOLING AND SERVICING AGREEMENT
Dated as of August 1, 2001
WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST
TABLE OF CONTENTS
Page
SECTION 1. Designation..............................................1
SECTION 2. Definitions..............................................2
SECTION 3. Reassignment and Transfer Terms..........................4
SECTION 4. Delivery and Payment for the Collateral Certificates.....4
SECTION 5. Form of Delivery of Collateral Certificates..............5
SECTION 6. Article IV of Agreement..................................5
SECTION 7. Early Amortization Events and Events of Default..........6
SECTION 8. Modification to and Ratification of Agreement............6
SECTION 9. Counterparts.............................................7
SECTION 10. Successors and Assigns...................................7
SECTION 11. Governing Law............................................7
SECTION 12. No Petition..............................................7
SECTION 13. Amendments...............................................7
EXHIBIT
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Exhibit A Collateral Certificate
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COLLATERAL SERIES SUPPLEMENT dated as of August 21, 2001 (this "SERIES SUPPLEMENT"), among WFN Credit Company, LLC, a Delaware limited liability company, as Transferor, World Financial Network National Bank, a national banking association, as Servicer, and BNY Midwest Trust Company (successor to the corporate trust administration of Harris Trust and Savings Bank, successor to The Bank of New York), as Trustee under the Second Amended and Restated Pooling and Servicing Agreement dated as of August 1, 2001, among Transferor, the Servicer and the Trustee (the "AGREEMENT").
Section 6.3 of the Agreement provides, among other things, that the Transferor and the Trustee may at any time and from time to time enter into a Supplement to the Agreement for the purpose of authorizing the delivery by Trustee to Transferor for the execution and redelivery to the Trustee for authentication of one or more Series of Investor Certificates.
Pursuant to this Series Supplement, Transferor and Trustee shall create a new Series of Investor Certificates and shall specify the Principal Terms thereof and add and amend certain provisions of the Agreement.
SECTION 1. DESIGNATION. There is hereby created a Series of Investor Certificates to be issued pursuant to the Agreement and this Series Supplement to be known as the "COLLATERAL CERTIFICATES." The Collateral Certificates will be transferred by the Transferor to World Financial Network Credit Card Master Note Trust (the "NOTE TRUST") pursuant to a Transfer and Servicing Agreement dated as of August 1, 2001 among the Transferor, the Servicer and the Note Trust. The Note Trust will pledge the Collateral Certificates as collateral for one or more series of notes (each, a "NOTE SERIES") to be issued by the Note Trust pursuant to a Master Indenture dated as of August 1, 2001 between the Note Trust and BNY Midwest Trust Company, as indenture trustee, and one or more supplements to the Master Indenture (each, an "INDENTURE SUPPLEMENT" and, together with the Master Indenture referred to above, the "INDENTURE"). The portions of the Collateral Certificates primarily securing each Note Series shall be treated as separate Series (each, a "COLLATERAL SERIES") under the Agreement and this Series Supplement. Certain terms pertaining to each Collateral Series will be defined in the applicable Indenture Supplements (but are hereby incorporated by reference into this Series Supplement), including whether or not such Collateral Series is a Principal Sharing Series and the Specified Transferor Amount for such Collateral Series. Unless and until the Trust has been terminated as permitted by Section 3(b) of this Series Supplement: (a) each Indenture Supplement executed and delivered by the Note Trust shall be deemed to supplement this Series Supplement; (b) a new Collateral Series shall be deemed to be issued upon the issuance of each Note Series and shall have the same designation (E.G., Series 2001-A) and belong to the same Group as the related Note Series; (c) the amounts payable as interest and principal on such Collateral Series shall equal the aggregate of the amounts payable on the related Note Series and shall be payable at the times and in the amounts specified in the Indenture
Supplement for such Note Series, (d) all amounts available and applied as credit
enhancement with respect to such Note Series shall be deemed to be available and
applied as credit enhancement with respect to such Collateral Series; (e) all
amounts payable to the Transferor pursuant to the related Indenture Supplement
shall be deemed to be payable to the Transferor pursuant to this Series
Supplement; (f) any "Additional Minimum Transferor Amount" specified in an
Indenture Supplement as an additional amount to be considered part of the
"Minimum Transferor Amount" pursuant to clause (b) of the definition thereof in
Annex A to the Master Indenture shall be deemed to be an additional amount to be
considered part of the Minimum Transferor Amount pursuant to clause (b) of the
definition of Minimum Transferor Amount and (g) the conditions defined in
Section 6.3 of the Agreement for issuance of new Series must be satisfied in
connection with each issuance of a Note Series.
SECTION 2. DEFINITIONS. If any term or provision contained herein shall conflict with or be inconsistent with any provision contained in the Agreement, the terms and provisions of this Series Supplement shall govern. All Article, Section or subsection references herein shall mean Article, Section or subsections of the Agreement, as amended or supplemented by this Series Supplement, except as otherwise provided herein. All capitalized terms not otherwise defined herein are used herein as defined in the Agreement. Each capitalized term defined herein shall relate only to the Collateral Certificates and no other Series of Certificates issued by the Trust.
"AMORTIZATION PERIOD" means, for any Collateral Series, any period specified in the related Indenture Supplement during which a share of principal collections is set aside to repay the principal investment in the related Note Series.
"BASE RATE" is defined for each Collateral Series in the related Indenture Supplement.
"BUSINESS DAY" is defined in Annex A to the Indenture.
"CLOSING DATE" means, for any Collateral Series, the "Closing Date" for the related Note Series, as defined in the related Indenture Supplement.
"COLLATERAL CERTIFICATES" is defined in Section 1 of this Series Supplement.
"COLLATERAL SERIES" is defined in Section 1 of this Series Supplement.
"DISTRIBUTION DATE" is defined for each Collateral Series in the related Indenture Supplement.
"EXCESS FINANCE CHARGE COLLECTIONS" means for any Collateral Series, all amounts identified as such in the related Indenture Supplement.
"FINANCE CHARGE SHORTFALL" means, for any Collateral Series, the Finance Charge Shortfall for the related Note Series, as defined in the related Indenture Supplement.
"INDENTURE" is defined in Section 1 of this Series Supplement.
"INDENTURE SUPPLEMENT" is defined in Section 1 of this Series Supplement.
"INVESTED AMOUNT" means, for any Collateral Series, the "Collateral Amount" of the related Note Series, as defined in the related Indenture Supplement.
"INVESTOR CERTIFICATE" means a Collateral Certificate.
"INVESTOR HOLDER" means the holder of record of any Investor Certificate.
"INVESTOR PERCENTAGE" means, for any Collateral Series, the "Allocation Percentage" for the related Note Series, as defined in the related Indenture Supplement.
"INVESTOR SERVICING FEE" means for any Collateral Series, the "Noteholder Servicing Fee" for the related Note Series as defined in the related Indenture Supplement.
"NOTE SERIES" is defined in Section 1 of this Series Supplement.
"NOTE TRUST" is defined in Section 1 of this Series Supplement.
"PORTFOLIO YIELD" is defined for each Collateral Series in the related Indenture Supplement.
"PRINCIPAL SHORTFALL" means, for any Collateral Series, the "Principal Shortfall" for the related Note Series, as defined in the related Indenture Supplement.
"RATING AGENCY" means, for any Collateral Series, the rating agencies for the related Note Series, as defined in the related Indenture Supplement.
"RECORD DATE" is defined for each Collateral Series in the related Indenture Supplement.
"REQUIRED RETAINED TRANSFEROR PERCENTAGE" is defined for each Collateral Series in the related Indenture Supplement.
"SERIES ACCOUNTS" means, for any Collateral Series, any "Series Accounts" established for the benefit of the related Note Series, as defined in the related Indenture Supplement.
"SERIES SERVICING FEE PERCENTAGE" is defined for each Collateral Series in the related Indenture Supplement.
"SERIES TERMINATION DATE" means, for any Collateral Series, the final maturity date for the related Note Series defined in the related Indenture Supplement.
"SHARED PRINCIPAL COLLECTIONS" means, for any Collateral Series, all amounts identified as such in the related Indenture Supplement.
SECTION 3. REASSIGNMENT AND TRANSFER TERMS.
(a) If the Servicer purchases, redeems or prepays any Note Series pursuant to an optional redemption provision under the related Indenture Supplement, then the related Collateral Series shall be deemed to have been retired. Upon the termination of any Note Series pursuant to the Indenture, the related Collateral Series shall also terminate.
(b) Once each Series of Certificates issued under the
Agreement has been retired, other than the Collateral Series and any other
Series the requisite holders of which have consented to the following
transactions, the holder of the Transferor Interest shall have the option to
transfer the Transferor Interest to the Note Trust, upon which transfer the
Trust shall terminate, and all of the Trust Assets shall be distributed to the
Note Trust, as holder of all of the beneficial interests in the Trust; PROVIDED
that such termination shall not take effect until Transferor has delivered to
the Indenture Trustee a Tax Opinion (as defined in Annex A to the Master
Indenture) with respect to the termination and favorable legal opinions as to
(i) the enforceability of any documents executed by Transferor in connection
with the termination and (ii) the validity and priority of the security interest
in the Receivables and the proceeds thereof granted by Transferor to Issuer
pursuant to the Transfer and Servicing Agreement, on terms substantially similar
to the most recent legal opinion delivered by Transferor's counsel as to the
validity and priority of the security interest granted by Transferor to the
Trust in connection with the then most recently issued Note Series.
SECTION 4. DELIVERY AND PAYMENT FOR THE COLLATERAL CERTIFICATES. Transferor shall execute and deliver the Collateral Certificates to Trustee for authentication in accordance with Section 6.1 of the Agreement. The Trustee shall deliver the Collateral Certificates when authenticated in accordance with Section 6.2 of the Agreement. For convenience, the Collateral Certificate shall be registered in the name of Indenture Trustee, notwithstanding that the Collateral Certificate shall have been initially issued to Transferor, transferred by Transferor to Issuer pursuant to the Transfer and Servicing Agreement and pledged by Issuer to Indenture Trustee pursuant to the Master Indenture.
SECTION 5. FORM OF DELIVERY OF COLLATERAL CERTIFICATES.
(a) The Collateral Certificates shall be delivered as Definitive Certificates, substantially in the form of EXHIBIT A hereto.
(b) Each Collateral Certificate shall constitute a "security"
within the meaning of (i) Article 8 of the Uniform Commercial Code (including
Section 8-102(a)(15) thereof) as in effect from time to time in the State of
Delaware and (ii) the Uniform Commercial Code of any other applicable
jurisdiction that presently or hereafter substantially includes the 1994
revisions to Article 8 thereof as adopted by the American Law Institute and the
National Conference of Commissioners on Uniform State Laws and approved by the
American Bar Association on February 14, 1995.
(c) For purposes of voting with respect to any consent or other matter under the Agreement or this Series Supplement, each class of notes included in any Note Series shall be deemed to be a Class of Certificates in the related Collateral Series, and the provisions for voting by beneficial owners of such notes specified in the Indenture shall apply MUTATIS MUTANDIS to voting under the Agreement and this Series Supplement.
(d) The Collateral Certificates may not be sold, participated, transferred, assigned or otherwise pledged or conveyed in whole or in part except upon the prior delivery to the Trustee and the Owner Trustee of a Tax Opinion (as defined in each of the Agreement and the Indenture, respectively) with respect thereto.
SECTION 6. ARTICLE IV OF AGREEMENT. Sections 4.1, 4.2, 4.3, 4.4 and 4.5 of the Agreement shall read in their entirety as provided in the Agreement. The remainder of Article IV of the Agreement shall read in its entirety as follows and shall be applicable only to the Collateral Certificates:
ARTICLE IV
RIGHTS OF CERTIFICATEHOLDERS AND
ALLOCATION AND APPLICATION OF COLLECTIONS
Section 4.1A RIGHTS OF INVESTOR CERTIFICATEHOLDERS. The Collateral Certificates shall represent undivided interests in the Trust, consisting of the right to receive (a) the related Allocation Percentage (as defined in the related Indenture Supplement) of Collections, (b) funds on deposit in the Collection Account and the Excess Funding Account allocable to the Collateral Certificates and funds on deposit in the Series Accounts, (c) Shared Principal Collections allocated to the Collateral Certificates in accordance with SUBSECTION 4.4, (d) Excess Finance Charge Collections allocated to the Collateral Certificates in accordance with SECTION 4.5 and (e) any related Enhancement for the Collateral Certificates and related Note Series. Unless otherwise specified in the related
Indenture Supplement, each Collateral Series shall consist of a single Class and shall not be senior or subordinated to any other Series. The Transferor Interest shall not represent any interest in the Collection Account or any Series Accounts, except as specifically provided in this Article IV and the related Indenture Supplement.
Section 4.6 ALLOCATIONS. The Servicer shall, prior to the close of business on the day any Collections are deposited in the Collection Account, allocate from the Collection Account to the Collateral Series related to each Note Series the amounts specified in the related Indenture Supplement, which shall be deposited or otherwise applied as provided in such Indenture Supplement.
SECTION 7. EARLY AMORTIZATION EVENTS AND EVENTS OF DEFAULT. In addition to the Early Amortization Events specified in Section 9.1 of the Agreement, the Early Amortization Events applicable to each Collateral Series shall be the Early Amortization Events specified in the related Indenture Supplement, as well as the Trust Early Amortization Events specified in the Indenture. In addition, each Note Series will have the benefit of applicable "Events of Default," as defined in the Indenture. Upon the occurrence of an applicable Event of Default, the Indenture Trustee shall have the right to foreclose upon a portion of the Receivables, as defined (and subject to the limitations stated) in the Indenture notwithstanding the continuing existence of the Trust, and the Trustee shall cooperate with the Indenture Trustee in the exercise of such right.
SECTION 8. MODIFICATION TO AND RATIFICATION OF AGREEMENT. For purposes of this Supplement and each Collateral Series:
(a) Notwithstanding anything to the contrary in Section 3.2 of the Agreement, the Servicing Fee payable with respect to each Note Series and the related Collateral Series shall be solely as set forth in the related Indenture Supplement; and
(b) Sections 3.7 and 12.2(c) shall not be applicable to any Collateral Series.
In addition, to the extent that the terms of this Series Supplement (directly or as supplemented by any Indenture Supplement) are deemed to be inconsistent with the terms of the Agreement, this Series Supplement shall be deemed to modify or amend the terms of the Agreement solely as applied to each Collateral Series affected by any such inconsistency, as permitted by Section 6.3(b) of the Agreement. Otherwise, as supplemented by this Series Supplement (and the various Indenture Supplements executed form time to time), the Agreement is in all respects ratified and confirmed and the Agreement as so amended and supplemented by this Series Supplement shall be read, taken and construed as one and the same instrument.
SECTION 9. COUNTERPARTS. This Series Supplement may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all of such counterparts shall together constitute but one and the same instrument.
SECTION 10. SUCCESSORS AND ASSIGNS. This Series Supplement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns.
SECTION 11. GOVERNING LAW. This Series Supplement shall be construed in accordance with the laws of the State of New York, without reference to its conflict of law provisions, and the obligations, rights and remedies of the parties hereunder shall be determined in accordance with such laws.
SECTION 12. NO PETITION. Servicer, Trustee and (with respect to the Trust only) Transferor, by entering into this Series Supplement and each Holder, by accepting a Collateral Certificate hereby covenant and agree that they will not at any time institute against the Trust or the Transferor, or join in any institution against the Trust or the Transferor of, any bankruptcy proceedings under any United States Federal or state bankruptcy or similar law in connection with any obligations relating to the Investor Holders, the Agreement or this Series Supplement provided, however that nothing herein shall prohibit the Trustee from filing proofs of claim or otherwise participating in any such proceedings instituted by any other person.
SECTION 13. AMENDMENTS. This Series Supplement may be amended
pursuant to Section 13.1 of the Agreement. This Series Supplement may also be
amended by Transferor without the consent of Servicer, Trustee or any Investor
Holder if Transferor provides Trustee with: (i) an Opinion of Counsel to the
effect that such amendment or modification would (A) reduce the risk that the
Trust would be treated as taxable as a publicly traded partnership pursuant to
Internal Revenue Code section 7704 or (B) permit the Trust or a relevant portion
thereof to be treated as a "financial asset securitization investment trust" and
(C) in either case, (1) would not cause the Trust to be classified, for Federal
income tax purposes, as an association (or publicly traded partnership) taxable
as a corporation and (2) would not cause or constitute an event in which gain or
loss would be recognized by any Investor Holder; (ii) a certificate that such
amendment or modification would not materially and adversely affect any Investor
Holder and (iii) satisfaction of the Rating Agency Condition; PROVIDED that no
such amendment shall be deemed effective without Trustee's consent, if Trustee's
rights, duties and obligations hereunder are thereby modified. Prior to the
execution of any such amendment (other than an amendment pursuant to SECTION
13.1(a) of the Agreement), Trustee shall furnish notification of the substance
of such amendment to each Rating Agency.
IN WITNESS WHEREOF, the parties have caused this Series Supplement to be duly executed by their respective officers as of the day and year first above written.
WFN CREDIT COMPANY, LLC,
as Transferor
By: /s/ Robert P. Armiak --------------------------------- Name: Robert P. Armiak Title: Vice President and Treasurer |
WORLD FINANCIAL NETWORK NATIONAL BANK
as Servicer
By: /s/ Robert P. Armiak --------------------------------- Name: Robert P. Armiak Title: Vice President and Treasurer |
BNY MIDWEST TRUST COMPANY,
as Trustee
By: /s/ Eric Lindahl --------------------------------- Name: Eric Lindahl Title Assistant Vice President |
COLLATERAL SERIES SUPPLEMENT SIGNATURE PAGE
EXHIBIT A
to
COLLATERAL SERIES SUPPLEMENT
FORM OF COLLATERAL CERTIFICATE
No.
WORLD FINANCIAL NETWORK CREDIT CARD MASTER TRUST
COLLATERAL CERTIFICATE
Evidencing an undivided interest in the World Financial Network National Credit Card Master Trust, the corpus of which consists of a portfolio of receivables created under credit card accounts originated by World Financial Network National Bank ("WFN") and other assets and interests constituting the trust under the Pooling and Servicing Agreement described below.
(Not an interest in or obligation of WFN)
This certifies that BNY MIDWEST TRUST COMPANY (the "CERTIFICATEHOLDER") is the registered owner of an undivided interest in a trust (the "TRUST"), the corpus of which consists of a portfolio of receivables (the "RECEIVABLES") now existing or hereafter created under selected credit card accounts originated by WFN and transferred to the Trust, all monies due or to become due with respect thereto and the other assets and interests constituting the Trust pursuant to the Second Amended and Restated Pooling and Servicing Agreement, dated as of August 1, 2001, as amended and supplemented, including by the Collateral Series Supplement, dated as of August 21, 2001 (collectively, the "POOLING AND SERVICING AGREEMENT"), among WFN Credit Company, LLC, as Transferor, WFN, as Servicer, and BNY Midwest Trust Company, (successor to the corporate trust administration of Harris Trust and Savings Bank, successor to The Bank of New York), as trustee.
THIS COLLATERAL CERTIFICATE DOES NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, WFN, AND NONE OF THIS CERTIFICATE, THE RECEIVABLES AND THE ACCOUNTS IS INSURED OR GUARANTEED BY THE FDIC OR ANY OTHER GOVERNMENTAL AGENCY. THIS COLLATERAL CERTIFICATE IS LIMITED IN RIGHT OF PAYMENT TO CERTAIN COLLECTIONS RESPECTING THE RECEIVABLES, ALL AS MORE SPECIFICALLY SET FORTH IN THE POOLING AND SERVICING AGREEMENT.
To the extent not defined herein, capitalized terms used herein have the meanings assigned in the Pooling and Servicing Agreement. This Collateral Certificate is issued under and is subject to the terms, provisions and conditions of
the Pooling and Servicing Agreement, to which Pooling and Servicing Agreement, as amended from time to time, the Certificateholder by virtue of its acceptance hereof assents and by which the Certificateholder is bound.
This Certificate represents series of Certificates entitled "World Financial Network Credit Card Master Trust Collateral Certificates" (the "COLLATERAL CERTIFICATES"), which represents an undivided interest in the Trust.
Unless the certificate of authentication hereon has been executed by or on behalf of the Trustee, by manual or facsimile signature of a duly authorized signatory, this Certificate shall not be entitled to any benefit under the Pooling and Servicing Agreement or be valid for any purpose.
IN WITNESS WHEREOF, the Trustee has caused this Collateral Certificate to be duly executed under its official seal.
BNY MIDWEST TRUST COMPANY,
as Trustee
Trustee's Certificate of Authentication
This is one of the Collateral Certificates referred to in the within- mentioned Pooling and Servicing Agreement.
BNY MIDWEST TRUST COMPANY,
as Trustee
By:________________________
Authorized Officer
Exhibit 4.8
RECEIVABLES PURCHASE AGREEMENT
between
WORLD FINANCIAL NETWORK NATIONAL BANK
RPA Seller,
and
WFN CREDIT COMPANY, LLC
Purchaser
Dated as of August 1, 2001
TABLE OF CONTENTS
PAGE
----
ARTICLE I DEFINITIONS .................................................. 1
Section 1.1 Definitions ............................................ 1
Section 1.2 Other Definitional Provisions .......................... 2
ARTICLE II SALE AND CONTRIBUTION OF RECEIVABLES ......................... 3
Section 2.1 Sales and Contributions ................................ 3
Section 2.2 Addition of Additional Accounts ........................ 5
Section 2.3 Removal of Accounts .................................... 7
ARTICLE III CONSIDERATION AND PAYMENT .................................... 7
Section 3.1 Purchase Price ......................................... 7
Section 3.2 Adjustments to Purchase Price .......................... 8
Section 3.3 Settlement and Ongoing Payment of Purchase
Price .................................................. 9
Section 3.4 Netting Arrangements ................................... 9
ARTICLE IV REPRESENTATIONS AND WARRANTIES .............................. 10
Section 4.1 Representations and Warranties of RPA Seller
Relating to RPA Seller ................................ 10
Section 4.2 Representations and Warranties of RPA Seller
Relating to the Agreement and the Receivables ......... 12
Section 4.3 Representations and Warranties of Purchaser ........... 14
ARTICLE V COVENANTS ................................................... 15
Section 5.1 RPA Seller Covenants .................................. 15
ARTICLE VI REPURCHASE OBLIGATION ....................................... 18
Section 6.1 Reassignment of Ineligible Receivables ................ 18
Section 6.2 Reassignment of Holders' Interest in Trust
Portfolio ............................................. 18
Section 6.3 Conveyance of Reassigned Receivables .................. 19
ARTICLE VII CONDITIONS PRECEDENT ........................................ 19
Section 7.1 Conditions to Purchase ................................ 19
Section 7.2 Conditions to Purchaser's Obligations
Regarding Additional Receivables ...................... 19
Section 7.3 Conditions Precedent to Obligations of RPA
Seller ................................................ 20
-i-
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TABLE OF CONTENTS
(CONTINUED)
PAGE
----
ARTICLE VIII TERM AND PURCHASE TERMINATION ............................... 20
Section 8.1 Term .................................................. 20
Section 8.2 Purchase Termination .................................. 20
ARTICLE IX MISCELLANEOUS PROVISIONS .................................... 20
Section 9.1 Amendment ............................................. 21
Section 9.2 GOVERNING LAW .......................................... 21
Section 9.3 Notices ............................................... 21
Section 9.4 Severability of Provisions ............................ 22
Section 9.5 Merger or Consolidation of, or Assumption of
the Obligations of, RPA Seller ........................ 22
Section 9.6 Acknowledgement and Agreement of RPA Seller ........... 23
Section 9.7 Further Assurances .................................... 24
Section 9.8 Nonpetition Covenant .................................. 24
Section 9.9 No Waiver; Cumulative Remedies ........................ 24
Section 9.10 Counterparts .......................................... 24
Section 9.11 Binding Third-Party Beneficiaries ..................... 24
Section 9.12 Merger and Integration ................................ 24
Section 9.13 Schedules and Exhibits ................................ 25
Exhibit A Form of Supplemental Conveyance ............................... A-1
Exhibit B Form of Subordinated Note ..................................... B-1
Schedule I Account Schedule .............................................. S-1
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RECEIVABLES PURCHASE AGREEMENT, dated as of August 1, 2001 (this "AGREEMENT") between WORLD FINANCIAL NETWORK NATIONAL BANK, a national banking association ("WFN"), as seller ("RPA SELLER"), and WFN CREDIT COMPANY, LLC, a Delaware limited liability company, as purchaser ("PURCHASER").
R E C I T A L S:
WHEREAS, Purchaser desires to purchase, from time to time, certain Receivables arising under certain specified Accounts of RPA Seller;
WHEREAS, RPA Seller desires to sell and assign such Receivables to Purchaser, from time to time, upon the terms and conditions hereinafter set forth;
WHEREAS, prior to the Certificate Trust Termination Date, it is contemplated that the Receivables purchased hereunder will be transferred by Purchaser to BNY Midwest Trust Company ("CERTIFICATE TRUST TRUSTEE"), as Trustee for World Financial Network Credit Card Master Trust (the "CERTIFICATE TRUST"), pursuant to the Second Amended and Restated Pooling and Servicing Agreement dated as of August 1, 2001 (the "POOLING AND SERVICING AGREEMENT") among WFN Credit Company, LLC, as Transferor, WFN, as Servicer, and Certificate Trust Trustee in connection with the issuance of certain Investor Certificates;
WHEREAS, after the Certificate Trust Termination Date, it is contemplated that the Receivables purchased hereunder will be transferred by Purchaser to World Financial Network Credit Card Master Note Trust (the "NOTE TRUST") pursuant to the Transfer and Servicing Agreement, dated as of August 1, 2001 between WFN Credit Company, LLC, as Transferor, WFN, as Servicer and the Note Trust, and that the Note Trust will thereafter pledge all of its right, title and interest therein to BNY Midwest Trust Company ("INDENTURE TRUSTEE"), as Indenture Trustee for the benefit of the Noteholders under Indenture, dated as of August 1, 2001 (the "INDENTURE") among Indenture Trustee and the Note Trust;
NOW, THEREFORE, it is hereby agreed by and between Purchaser and RPA Seller as follows:
ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. Each capitalized term used herein or in any certificate, document, or Conveyance Paper made or delivered pursuant hereto, and not defined herein or therein, shall (i) prior to the Certificate Trust Termination Date, have the meaning (if any) specified in the Pooling and Servicing Agreement, and, if not otherwise defined therein, shall have the meaning specified in Annex A to the Indenture and (ii) after the Certificate Trust Termination Date, shall have the meaning specified in Annex A to the Indenture. In addition, the following words and phrases shall have the following meanings:
"CLOSING DATE" means, collectively, (a) prior to the Certificate Trust Termination Date, any "Closing Date" (as defined in the Pooling and Servicing Agreement) and (b) any "Closing Date" (as defined in Annex A to the Indenture).
"ENHANCEMENT" means, collectively, (a) prior to the Certificate Trust Termination Date, any "Enhancement" (as defined in the Pooling and Servicing Agreement) and (b) any "Enhancement" (as defined in Annex A to the Indenture).
"ENHANCEMENT PROVIDER" means, collectively, (a) prior to the Certificate Trust Termination Date, any "Enhancement Provider" (as defined in the Pooling and Servicing Agreement) and (b) any "Enhancement Provider" (as defined in Annex A to the Indenture).
"HOLDERS" means the Investor Holders and the Noteholders.
"RATING AGENCY" means (a) with respect to any Series of Investor Certificates, a "Rating Agency" (as defined in the Pooling and Servicing Agreement) for such Series, and (b) with respect to any Series of Notes, a "Rating Agency" (as defined in Annex A to the Indenture) for such Series.
"RATING AGENCY CONDITION" means, with respect to any action, that the "Rating Agency Condition" (as defined in the Pooling and Servicing Agreement) shall have been satisfied with respect to each outstanding Series of Investor Certificates and that the "RATING AGENCY CONDITION" (as defined in Annex A to the Indenture) shall have been satisfied with respect to each outstanding Series of Notes.
"SERIES" means, as the context requires, (a) any Series (as defined in the Pooling and Servicing Agreement) or (b) any "Series" (as defined in Annex A to the Indenture).
"SUPPLEMENT" means any "SUPPLEMENT" to (and as defined in) the Pooling and Servicing Agreement and any Indenture Supplement.
"TRANSACTION DOCUMENTS" means, collectively, (a) prior to the Certificate Trust Termination Date, the "TRANSACTION DOCUMENTS" (as defined in the Pooling and Servicing Agreement) and (b) the "Transaction Documents" (as defined in Annex A to the Indenture).
Section 1.2 OTHER DEFINITIONAL PROVISIONS. All terms defined directly or by reference in this Agreement shall have the defined meanings when used in any certificate or other document delivered pursuant hereto unless otherwise defined therein. For purposes of this Agreement and all such certificates and other documents, unless the context otherwise requires: (i) accounting terms not otherwise defined in this Agreement, and accounting terms partly defined in this Agreement to the extent not defined, shall have the respective meanings given to them under generally accepted accounting principles; (ii) terms defined in Article 9 of the UCC as in effect in the State of Ohio and not otherwise defined in this Agreement are used as defined in that Article; (iii) any reference to each Rating Agency shall only apply to any specific rating agency if such rating agency is then rating any outstanding Series; (iv) references to any
amount as on deposit or outstanding on any particular date means such amount at
the close of business on such day; (v) the words "hereof," "herein" and
"hereunder" and words of similar import refer to this Agreement (or the
certificate or other document in which they are used) as a whole and not to any
particular provision of this Agreement (or such certificate or document); (vi)
references to any Section, Schedule or Exhibit are references to Sections,
Schedules and Exhibits in or to this Agreement (or the certificate or other
document in which the reference is made), and references to any paragraph,
Section, clause or other subdivision within any Section or definition refer to
such paragraph, subsection, clause or other subdivision of such Section or
definition; (vii) the term "including" means "including without limitation";
(viii) references to any law or regulation refer to that law or regulation as
amended from time to time and include any successor law or regulation; (ix)
references to any Person include that Person's successors and assigns; and (x)
headings are for purposes of reference only and shall not otherwise affect the
meaning or interpretation of any provision hereof.
ARTICLE II
SALE AND CONTRIBUTION OF RECEIVABLES
Section 2.1 SALES AND CONTRIBUTIONS.
(a) In consideration of the membership interest in Purchaser held by RPA Seller, RPA Seller agrees to contribute, and does hereby contribute to Purchaser, and Purchaser agrees to accept, and does hereby accept, from RPA Seller on the Effective Date, $ 118,100,280.27 of Existing Assets. The Existing Assets not so contributed to Purchaser on the Effective Date are hereby sold, transferred, set over, assigned and otherwise conveyed by RPA Seller to Purchaser for a purchase price to be agreed to by RPA Seller and Purchaser, which purchase price shall be payable on the Effective Date and shall not be materially less favorable to RPA Seller than prices for transactions of a generally similar character taking into account the quality of such Existing Assets and other pertinent factors. The purchase price for the Existing Assets (other than Existing Assets contributed to Purchaser) shall be deemed to be a borrowing under the Subordinated Note. The contribution and sales of the Existing Assets from RPA Seller to Purchaser are subject in each case to any rights in the Existing Assets transferred, assigned, set over or otherwise conveyed to the Certificate Trust Trustee pursuant to the Existing PSA. It is understood and agreed that the obligations of RPA Seller specified herein with respect to the Receivables, including its repurchase obligations under ARTICLE VI of this Agreement, shall apply to all Receivables, whether originated before, on or after the Effective Date. RPA Seller and Purchaser hereby agree that each existing Receivable sold by RPA Seller to the Certificate Trust pursuant to the Existing PSA before the Effective Date shall be deemed to have been sold by RPA Seller to Purchaser on the date on which it was so sold to the Certificate Trust.
(b) RPA Seller hereby transfers, assigns, sets over and otherwise conveys to Purchaser without recourse (except as expressly provided herein), and Purchaser purchases and/or accepts as a capital contribution, as applicable, from RPA Seller, all of RPA Seller's right, title and interest in and to the Receivables now existing and arising
from time to time in the Accounts and Related Assets with respect thereto (other than the Existing Assets); PROVIDED, HOWEVER, that Principal Receivables originated after the occurrence of an Insolvency Event with respect to RPA Seller shall not be conveyed hereunder.
(c) RPA Seller agrees (i) to record and file, at its own expense, financing statements (and continuation statements when applicable) with respect to the Receivables now existing and hereafter created, meeting the requirements of applicable state law in such manner and in such jurisdictions as are necessary to perfect, and maintain perfection of, the conveyance of the Receivables to Purchaser and the first priority nature of Purchaser's interest in the Receivables and to deliver a file-stamped copy of such financing statements or other evidence of such filings to Purchaser and Receivables Trust Trustee (which evidence may, for purposes of this SECTION 2.1, consist of telephone confirmation of such filing to Purchaser and Receivables Trust Trustee, followed by delivery of a file stamped copy to Receivables Trust Trustee with a copy to Purchaser as soon as is practicable after filing) on or prior to the Effective Date, and in the case of any continuation statements filed pursuant to this SECTION 2.1, as soon as practicable after receipt thereof by RPA Seller.
(d) RPA Seller further agrees, at its own expense, (i) on or prior to (A) the Automatic Addition Termination Date or an Automatic Addition Suspension Date, or subsequent to a Restart Date, in the case of any Accounts designated pursuant hereto prior to such date, (B) the applicable Addition Date, in the case of Supplemental Accounts, and (C) the applicable Removal Date, in the case of Removed Accounts, to indicate in its appropriate computer files that Receivables created in connection with the Accounts (other than Removed Accounts) have been sold to Purchaser pursuant to this Agreement and transferred by Purchaser to the Receivables Trust pursuant to the applicable Transfer Agreement for the benefit of the Holders (or conveyed to the Transferor or its designee in accordance with SECTION 2.9 of the Pooling and Servicing Agreement or SECTION 2.7 of the Transfer and Servicing Agreement, as the case may be, in the case of Removed Accounts) by including in such computer files the code identifying each such Account (or, in the case of Removed Accounts, either including such a code identifying the Removed Accounts only if the removal occurs prior to the Automatic Addition Termination Date or Automatic Addition Suspension Date or subsequent to a Restart Date, or deleting such code thereafter) and (ii) on or prior to the date referred to in CLAUSES (i)(A), (B) or (C), as applicable, to deliver to Purchaser and Receivables Trust Trustee an Account Schedule (PROVIDED that such Account Schedule shall be provided in respect of Automatic Additional Accounts on or prior to the Determination Date relating to the Monthly Period during which the respective Addition Dates occur) specifying for each such Account, as of the Automatic Addition Termination Date or Automatic Addition Suspension Date, in the case of CLAUSE (i)(A), the applicable Addition Cut Off Date, in the case of Supplemental Accounts, and the Removal Date, in the case of Removed Accounts, its account number, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables in such Account. Such Account Schedule shall be supplemented from time to time to reflect Supplemental Accounts and Removed Accounts. Once the code referenced in CLAUSE (i) of this paragraph has been included with respect to any Account, RPA Seller
further agrees not to alter such code or other notation during the term of this Agreement unless and until (x) such Account becomes a Removed Account, (y) a Restart Date has occurred on which Purchaser starts including Automatic Additional Accounts as Accounts or (z) RPA Seller shall have delivered to Purchaser and Receivables Trust Trustee and, after the Certificate Trust Termination Date, the Owner Trustee at least 30 days prior written notice of its intention to do so and has taken such action as is necessary or advisable to cause the respective interests of Purchaser and Receivables Trust Trustee in the Receivables and other Trust Assets to continue to be perfected with the priority required by this Agreement and the applicable Transfer Agreement, respectively.
(e) It is the intention of the parties hereto that the conveyances of the Existing Assets, the Receivables and the other Related Assets by RPA Seller to Purchaser as provided in this SECTION 2.1 be, and be construed as, an absolute sales or capital contributions, including for accounting purposes, without recourse except as explicitly provided herein, of the Existing Assets, the Receivables and the other Related Assets by RPA Seller to Purchaser. Furthermore, it is not intended that such conveyance be deemed a pledge of the Existing Assets, the Receivables and the other Related Assets by RPA Seller to Purchaser to secure a debt or other obligation of RPA Seller. If, however, notwithstanding the intention of the parties, the conveyance provided for in this SECTION 2.1 is determined to be a transfer for security, then this Agreement shall also be deemed to be a security agreement and RPA Seller hereby grants to Purchaser a security interest in all of RPA Seller's right, title and interest in and to the Existing Assets, the Receivables and the other Related Assets.
Section 2.2 ADDITION OF ADDITIONAL ACCOUNTS.
(a) REQUIRED ADDITIONS. If Purchaser is required, pursuant to SECTION 2.8(b) of the Pooling and Servicing Agreement or SECTION 2.6 of the Transfer and Servicing Agreement, to designate additional Eligible Accounts as Supplemental Accounts or to convey Participation Interests to the Receivables Trust, Purchaser shall so notify RPA Seller. RPA Seller shall designate such Eligible Accounts as Supplemental Accounts and shall convey to Purchaser Receivables in such Supplemental Accounts or (if it so elects) shall convey such Participation Interests to Purchaser, subject to the same qualifications and restrictions as are set forth in SECTION 2.8 of the Pooling and Servicing Agreement or SECTION 2.6 of the Transfer and Servicing Agreement, as applicable, with respect to Purchaser; PROVIDED, HOWEVER, that the failure of RPA Seller to transfer Receivables or Participation Interests to Purchaser as provided in this paragraph solely as a result of the unavailability of a sufficient amount of Eligible Receivables shall not constitute a breach of this Agreement; PROVIDED FURTHER, that any such failure which has not been timely cured will nevertheless result in the occurrence of an Early Amortization Event with respect to each Series for which, pursuant to the Supplement therefor, a failure by Purchaser to convey Receivables in Additional Accounts or Participation Interests to the Receivables Trust by the day on which it is required to convey such Receivables or Participation Interests constitutes an "EARLY AMORTIZATION EVENT" (as defined in such Supplement).
(b) PERMITTED ADDITIONS. Subject to the restrictions and qualifications set forth in SECTION 2.8 of the Pooling and Servicing Agreement or SECTION 2.6 of the Transfer and Servicing Agreement, Purchaser shall exercise its rights to designate additional Eligible Accounts as Supplemental Accounts or Automatic Additional Accounts pursuant to SECTIONS 2.8(A) and (C) of the Pooling and Servicing Agreement or SECTIONS 2.6(A) and (C) of the Transfer and Servicing Agreement when requested to do so by RPA Seller.
(c) ADDITIONAL APPROVED PORTFOLIOS. Subject to the restrictions and qualifications set forth in SECTION 2.8(E) of the Pooling and Servicing Agreement or SECTION 2.6 of the Transfer and Servicing Agreement, Purchaser shall exercise its rights to designate additional portfolios of accounts as "Approved Portfolios" when requested to do so by RPA Seller.
(d) DELIVERY OF DOCUMENTS. RPA Seller agrees to provide to Purchaser such
information, certificates, financing statements, opinions and other materials as
are reasonably necessary to enable Purchaser to satisfy its obligations under
SECTION 2.8 of the Pooling and Servicing Agreement and SECTION 2.6 of the
Transfer and Servicing Agreement with respect to Supplemental Accounts,
Automatic Additional Accounts or Participation Interests of RPA Seller. In the
case of the designation of Supplemental Accounts, RPA Seller shall deliver to
Purchaser on the date designated by Purchaser (i) the computer file, microfiche
list or written list required to be delivered pursuant to SECTION 1.1 with
respect to such Supplemental Accounts and (ii) a duly executed, written
assignment, substantially in the form of EXHIBIT A (the "SUPPLEMENTAL
CONVEYANCE").
(e) REPRESENTATIONS AND WARRANTIES. In connection with the designation of any Eligible Account as a Supplemental Account, the conveyance of any Participation Interests to Purchaser, RPA Seller shall represent and warrant that:
(i) each Supplemental Account is, as of the Addition Date, an Eligible Account, and each Receivable in such Supplemental Account is, as of the Addition Cut Off Date, an Eligible Receivable; no selection procedures believed by RPA Seller to be materially adverse to the interests of Purchaser or the Holders were utilized in selecting the Additional Accounts from the available Eligible Accounts in an Approved Portfolio; and that as of the Addition Date, RPA Seller is not insolvent; and
(ii) as of the Addition Date, the Supplemental Conveyance constitutes a valid sale to Purchaser of all right, title and interest of RPA Seller in and to the Receivables and the Related Assets then existing and thereafter created from time to time in the Supplemental Accounts, and such property will be held by Purchaser free and clear of any Lien of any Person claiming through or under RPA Seller or any of its Affiliates
Section 2.3 REMOVAL OF ACCOUNTS. Purchaser may remove Accounts from the Receivables Trust in accordance with SECTION 2.9 of the Pooling and Servicing
Agreement or SECTION 2.7 of the Transfer and Servicing Agreement. On each day on which Accounts are removed from the Receivables Trust pursuant to SECTION 2.9 of the Pooling and Servicing Agreement or SECTION 2.7 of the Transfer and Servicing Agreement, RPA Seller and Purchaser may, but shall not be required to, by mutual agreement, remove Accounts from the operation of this Agreement. RPA Seller agrees to provide to Purchaser such information, certificates, financing statement, opinions and other materials as are reasonably necessary to enable Purchaser to satisfy its obligations under SECTION 2.9 of the Pooling and Servicing Agreement and SECTION 2.7 of the Transfer and Servicing Agreement with respect to the removal of Accounts.
ARTICLE III
CONSIDERATION AND PAYMENT
Section 3.1 PURCHASE PRICE.
(a) The "PURCHASE PRICE" for the Receivables (including Receivables in Additional Accounts) to be conveyed to Purchaser under this Agreement that come into existence on or after the Effective Date shall be payable on each Business Day on which such Receivables are conveyed by RPA Seller to Purchaser in an amount equal to 100% of the Principal Receivables so conveyed, adjusted from time to time with respect to Principal Receivables originated hereafter to reflect such factors as RPA Seller and Purchaser mutually agree will result in a Purchase Price determined to approximate the fair market value of such Principal Receivables. If and to the extent that Purchaser shall not have funds available to pay RPA Seller the Purchase Price for the Receivables transferred on any day, an amount equal to the portion of the Purchase Price for such Receivables for which Purchaser shall not have funds shall be deemed to be a borrowing by Purchaser from RPA Seller under the Subordinated Note in the amount of such deficiency; PROVIDED that no borrowing may be made under the Subordinated Note if, after giving effect to such borrowing, Purchaser Tangible Equity would be less than Required Purchaser Tangible Equity; and PROVIDED, FURTHER, that RPA Seller may, in its discretion, contribute Receivables on any Business Day and the Purchase Price of such Receivables shall be deemed to be a capital contribution from RPA Seller to Purchaser.
(b) RPA Seller is hereby authorized by Purchaser to endorse on the schedule attached to the Subordinated Note (or a continuation of such schedule attached thereto and made a part thereof) an appropriate notation evidencing the date and amount of each borrowing thereunder, as well as the date and amount of each payment made with respect thereto; PROVIDED that the failure of any Person to make such a notation shall not affect any obligations of Purchaser thereunder.
(c) The terms and conditions of the Subordinated Note and all borrowings thereunder shall be as follows:
(i) All amounts paid by Purchaser with respect to the Subordinated Note shall be allocated first to the repayment of accrued interest until all such
interest is paid, and then to the outstanding principal amount of the Subordinated Note.
(ii) The outstanding principal amount of the Subordinated Note shall bear interest at a fixed rate per annum of 10% from the Effective Date, calculated based on a 360-day year consistently of twelve thirty-day months, or such other rate as shall be agreed upon by RPA Seller and Purchaser from time to time (such rate as in effect from time to time, the "SUBORDINATED NOTE RATE"). Interest on the Subordinated Note shall be payable on October 15, 2001 and the 15th day of each calendar month thereafter, or if the 15th is not a Business Day, the next succeeding Business Day (each such date, an "INTEREST PAYMENT DATE"). If on any Interest Payment Date, the amount of funds available to pay interest on the Subordinated Note is insufficient to pay any amount due under the Subordinated Note, then interest shall be payable only to the extent funds are available thereof. All interest in the Subordinated Note that is not paid when due pursuant to this paragraph shall be payable on the next Interest Payment Date on which funds are available therefore and all such unpaid interest shall accrue interest at the Subordinated Note Rate until paid in full.
(iii) Purchaser may at its option, prepay the Subordinated Note at
any time and from time to time; provided that in no event shall RPA Seller
or any holder of the Subordinated Note have any right to demand any
payment of principal under the Subordinated Note prior to the date that is
one year and one day after the latest occurring Series Termination Date
for any Series of Investor Certificates or any Series of Notes (the
"SUBORDINATED NOTE MATURITY DATE").
Section 3.2 ADJUSTMENTS TO PURCHASE PRICE. During any Monthly Period, if
(a) Servicer adjusts downward the amount of any Receivable because of a rebate,
refund, unauthorized charge or billing error to an accountholder, or because
such Receivable was created in respect of merchandise which was refused or
returned by an accountholder, or if Servicer otherwise adjusts downward the
amount of any Receivable without receiving Collections therefor or charging off
such amount as uncollectible or (b) any Principal Receivable is discovered by
Servicer as having been created through a fraudulent or counterfeit charge, then
the Purchase Price shall be reduced as provided below (a "CREDIT ADJUSTMENT").
The amount of such Credit Adjustment with respect to any Receivable adjusted
downward as described in CLAUSE (a) of the preceding sentence, shall be equal to
the amount of such adjustment and, with respect to any Receivable described in
clause (b) of the preceding sentence, shall equal either (i) the Purchase Price
paid with respect to such Receivable (including any portion thereof deemed to be
a borrowing under the Subordinated Note or deemed to be a capital contribution
from RPA Seller to Purchaser) as determined on the date on which such Receivable
was purchased computed in accordance with SECTION 3.1 or (ii) in the case of any
Receivable that was deemed to have been sold to Purchaser by RPA Seller prior to
the Effective Date, the principal balance of such Receivable. The amount of any
Credit Adjustment may be offset against any amounts due from Purchaser to RPA
Seller on such day; provided that, subject to the following proviso, RPA Seller
shall not be obligated to make any cash payment with respect to a Credit
Adjustment until the Distribution Date
following the Monthly Period in which such Credit Adjustment arose in accordance with SECTION 3.3; provided, further, that, if, as a result of the occurrence of any event giving rise to a Credit Adjustment, Purchaser is required to deposit funds into the Excess Funding Account pursuant to SECTION 3.9 of the Pooling and Servicing Agreement or SECTION 3.9 of the Transfer and Servicing Agreement, RPA Seller shall pay Purchaser the amount by which the Purchase Price would be reduced in immediately available funds on or before the date Purchaser is required to make such deposit to the Excess Funding Account. To secure its obligations to make the payments required by the preceding sentence, RPA Seller hereby grants to Purchaser and its assigns, a security interest in (i) its rights to receive payments from any Merchant under any Credit Card Processing Agreement on account of rebates, refunds, unauthorized charges, refused or returned merchandise or any other event or circumstance that causes Servicer to adjust downward the amount of any Receivable without receiving Collections therefor or charging off such amount as uncollectible ("MERCHANT ADJUSTMENT PAYMENTS"), (ii) any collateral security granted to, or guaranty for the benefit of, RPA Seller with respect to Merchant Adjustment Payments, (iii) all amounts received from any Merchant on account of Merchant Adjustment Payments and (iv) all proceeds of such rights and such amounts.
Section 3.3 SETTLEMENT AND ONGOING PAYMENT OF PURCHASE PRICE. On each Distribution Date, RPA Seller shall deliver a settlement statement (the "SETTLEMENT STATEMENT"), showing the aggregate Purchase Price of Receivables conveyed to Purchaser during the prior Monthly Period (or, with respect to the first Distribution Date following the Effective Date, the period from and including the Effective Date through the last day of the calendar month preceding such Distribution Date), and the amount which remains unpaid as Credit Adjustments made with respect to such period pursuant to SECTION 3.2 or any adjustment to the Purchase Price of Receivables with respect to such period pursuant to SECTION 6.1, each of which shall reduce the aggregate Purchase Price payable by Purchaser for such period. Any balance due from Purchaser to RPA Seller shall be paid in accordance with SECTION 3.1. Any balance due from RPA Seller to Purchaser shall be paid in immediately available funds.
Section 3.4 NETTING ARRANGEMENTS. Except as otherwise required by SECTION 4.3 of the Pooling and Servicing Agreement or SECTION 8.4(a) of the Indenture (with respect to In-Store Payments) and the terms of any Supplement, RPA Seller may permit or require payments owed by any Merchant with respect to In-Store Payments and Merchant Adjustment Payments to be netted against amounts owed by RPA Seller to that Merchant. RPA Seller shall pay to Purchaser (or, so long as RPA Seller is Servicer, deposit directly into the Collection Account) on each Business Day an amount equal to the aggregate amount of In-Store Payments netted against amounts owed by RPA Seller to the various Merchants on that Business Day. If, however, Purchaser is required under any Supplement to require RPA Seller to discontinue such netting as to any Merchant, then RPA Seller shall not permit In-Store Payments or Merchant Adjustment Payments to be netted against amounts payable by RPA Seller to that Merchant, but instead RPA Seller shall cause that Merchant to transfer to RPA Seller, not later than the second Business Day following receipt by such Merchant of any In-Store Payments or any
event obligating that Merchant to make a Merchant Adjustment Payment, an amount equal to the sum of such In-Store Payments and Merchant Adjustment Payments.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.1 REPRESENTATIONS AND WARRANTIES OF RPA SELLER RELATING TO RPA SELLER.
(a) REPRESENTATIONS AND WARRANTIES. RPA Seller hereby represents and warrants to, and agrees with, Purchaser as of the Effective Date and on each Closing Date, that:
(i) ORGANIZATION AND GOOD STANDING. RPA Seller is a national banking association validly existing in good standing under the laws of the United States, and has full corporate power, authority and legal right to own its properties and conduct its business as presently owned and conducted, and to execute, deliver and perform its obligations under this Agreement.
(ii) DUE QUALIFICATION. RPA Seller is duly qualified to do business and is in good standing (or is exempt from such requirements), and has obtained all necessary licenses and approvals in each jurisdiction in which failure to so qualify or to obtain such licenses and approvals would render any Credit Card Agreement relating to an Account owned by RPA Seller or any Receivable unenforceable by RPA Seller, Purchaser, the Servicer or Receivables Trust Trustee or would have a material adverse effect on the interests of Purchaser or the Holders.
(iii) DUE AUTHORIZATION. The execution, delivery and performance of this Agreement and any other document or instrument delivered pursuant hereto (such other documents or instruments, collectively, the "CONVEYANCE PAPERS") and the consummation of the transactions provided for in this Agreement or any other Conveyance Papers have been duly authorized by all necessary corporate action on the part of RPA Seller.
(iv) NO CONFLICT. The execution and delivery of this Agreement and the Conveyance Papers by RPA Seller, the performance of the transactions contemplated by this Agreement and the Conveyance Papers, and the fulfillment of the terms of this Agreement and the Conveyance Papers applicable to RPA Seller will not conflict with, result in any breach of any of the material terms and provisions of, or constitute (with or without notice or lapse of time or both) a material default under, any indenture, contract, agreement, mortgage, deed of trust, or other instrument to which RPA Seller is a party or by which it or any of its properties are bound.
(v) NO VIOLATION. The execution, delivery and performance of this Agreement and the Conveyance Papers by RPA Seller and the fulfillment by
RPA Seller of the terms hereof and thereof will not conflict with or violate any Requirements of Law applicable to RPA Seller.
(vi) NO PROCEEDINGS. There are no proceedings or investigations pending or, to the best knowledge of RPA Seller, threatened against RPA Seller, before any court, regulatory body, administrative agency or other tribunal or governmental instrumentality (i) asserting the invalidity of this Agreement or any of the Conveyance Papers, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement or any of the Conveyance Papers, (iii) seeking any determination or ruling that, in the reasonable judgment of RPA Seller, would materially and adversely affect the performance by RPA Seller of its obligations under this Agreement or any of the Conveyance Papers, (iv) seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Agreement or any of the Conveyance Papers or (v) seeking to affect adversely the income tax attributes of the Certificate Trust or the Note Trust under Federal or applicable state income or franchise tax systems.
(vii) ALL CONSENTS REQUIRED. All approvals, authorizations, consents, orders or other actions of any Person or any governmental body or official required in connection with the execution and delivery by RPA Seller of this Agreement or any of the Conveyance Papers and the performance of the transactions contemplated by this Agreement or any of the Conveyance Papers by RPA Seller have been obtained.
(viii)INSOLVENCY. RPA Seller is not insolvent and no Insolvency Event with respect to RPA Seller has occurred, and the transfer of the Existing Assets, the Receivables and Related Assets by RPA Seller to Purchaser contemplated hereby has not been made in contemplation of such insolvency or Insolvency Event.
(b) NOTICE OF BREACH; RELIANCE. The representations and warranties of RPA Seller set forth in this SECTION 4.1 shall survive the transfer and assignment by RPA Seller of the Receivables to Purchaser and the transfer and assignment by Purchaser of the Receivables to the Receivables Trust. Upon discovery by RPA Seller or Purchaser of a breach of any of the representations and warranties by RPA Seller set forth in this SECTION 4.1, the party discovering such breach shall give prompt written notice to the other and to each Enhancement Provider, if any, entitled thereto pursuant to the relevant Supplement. RPA Seller hereby acknowledges that Purchaser intends to rely on the representations hereunder in connection with representations made by Purchaser to secured parties, assignees or subsequent transferees, including transfers made by Purchaser to the Certificate Trust pursuant to the Pooling and Servicing Agreement and to the Note Trust pursuant to the Transfer and Servicing Agreement. RPA Seller agrees to cooperate with Purchaser, Servicer and Receivables Trust Trustee in attempting to cure any such breach.
Section 4.2 REPRESENTATIONS AND WARRANTIES OF RPA SELLER RELATING TO THE AGREEMENT AND THE RECEIVABLES.
(a) REPRESENTATIONS AND WARRANTIES. RPA Seller hereby represents and warrants to Purchaser as of the Effective Date and, with respect to Additional Accounts, as of the related Addition Date that:
(i) this Agreement and, in the case of Supplemental Accounts, the related Supplemental Conveyance, when executed and delivered on behalf of RPA Seller, each constitutes a legal, valid and binding obligation of RPA Seller, enforceable against RPA Seller in accordance with its terms, except as such enforceability may be limited by applicable Debtor Relief Laws now or hereafter in effect and by general principles of equity (whether considered in a suit at law or in equity);
(ii) as of the Automatic Addition Termination Date or an Automatic Addition Suspension Date, as of each subsequent Addition Date with respect to Supplemental Accounts, and as of the applicable Removal Date with respect to Removed Accounts, the Account Schedule delivered pursuant to this Agreement, as supplemented to such date, is an accurate and complete listing in all material respects of all the Accounts as of such Automatic Addition Termination Date or Automatic Addition Suspension Date, the related Addition Cut Off Date or such Removal Date, as the case may be, and the information contained therein with respect to the identity of such Accounts and the Receivables existing thereunder is true and correct in all material respects as of such specified date;
(iii) RPA Seller is the legal and beneficial owner of all right, title and interest in each Receivable and RPA Seller has the full right, power and authority to transfer the Receivables pursuant to this Agreement, and each Receivable conveyed to Purchaser by RPA Seller has been conveyed to Purchaser free and clear of any Lien of any Person claiming through or under RPA Seller or any of its Affiliates (other than Liens permitted under SECTION 5.1(b), SECTION 2.7(b) of the Pooling and Servicing Agreement or SECTION 2.5(b) of the Transfer and Servicing Agreement) and in compliance, in all material respects, with all Requirements of Law applicable to RPA Seller;
(iv) all authorizations, consents, orders or approvals of or registrations or declarations with any Governmental Authority required to be obtained, effected or given by RPA Seller in connection with the conveyance of such Receivable to Purchaser have been duly obtained, effected or given and are in full force and effect;
(v) this Agreement or, in the case of Supplemental Accounts, the related Supplemental Conveyance, upon execution and delivery on behalf of RPA Seller, constitutes a valid transfer and assignment to Purchaser of all right,
title and interest of RPA Seller in and to the Existing Assets, the Receivables and the other Related Assets conveyed to Purchaser by RPA Seller;
(vi) except as otherwise expressly provided in this Agreement, the Pooling and Servicing Agreement or any Supplement thereto, the Transfer and Servicing Agreement, the Indenture or any Indenture Supplement neither RPA Seller nor any Person claiming through or under RPA Seller has any claim to or interest in the Collection Account, the Excess Funding Account, any Series Account or any Enhancement;
(vii) with respect to each Automatic Additional Account, on the date of its creation or the date it otherwise becomes an Automatic Additional Account, and with respect to each Supplemental Account, on the related Addition Cut Off Date each such Account is classified as an Eligible Account;
(viii)on the date of creation of each Automatic Additional Account or on the date the related account otherwise becomes an Automatic Additional Account, each Receivable contained in such Automatic Additional Account is an Eligible Receivable and, on the applicable Additional Cut Off Date, each Receivable contained in any related Supplemental Account is an Eligible Receivable; and
(ix) as of the date of the creation of any new Receivable, such Receivable is an Eligible Receivable.
(b) PERFECTION REPRESENTATIONS AND WARRANTIES. Debtor hereby makes the Perfection Representations and Warranties to the Secured Party. For purposes of this SECTION 4.2(b): Debtor shall mean RPA Seller, Secured Party shall mean Transferor, and Specified Agreement shall mean this Receivables Purchase Agreement. The rights and remedies with respect to any breach of the Perfection Representations and Warranties made under this SECTION 4.2(b) shall be continuing and shall survive any termination of the Specified Agreement. Secured Party shall not waive a breach of any Perfection Representation and Warranty. In order to evidence the interests of Debtor and Secured Party under the Specified Agreement, the Debtor and Servicer shall, from time to time take such action, and execute and deliver such instruments (including, without limitation, such actions or filings as are requested by the Secured Party and financing statements under the UCC as enacted and then in effect in any other jurisdiction in which the Debtor is organized, has its principal place of business or maintains any books, records, files or other information concerning the Receivables) in order to maintain and perfect, as a first priority interest, the Secured Party's security interest in the Receivables. The Debtor hereby authorizes Servicer to file financing statements under the UCC without the Debtor's signature where allowed by applicable law.
(c) NOTICE OF BREACH; RELIANCE. The representations and warranties of RPA Seller set forth in this SECTION 4.2 shall survive the transfer and assignment by RPA Seller of the Receivables to Purchaser and the transfer and assignment by Purchaser of
the Receivables to the Receivables Trust. Upon discovery by RPA Seller or Purchaser of a breach of any of the representations and warranties by RPA Seller set forth in this SECTION 4.2, the party discovering such breach shall give prompt written notice to the other and to each Enhancement Provider, if any, entitled thereto pursuant to the relevant Supplement. RPA Seller hereby acknowledges that Purchaser intends to rely on the representations hereunder in connection with representations made by Purchaser to secured parties, assignees or subsequent transferees, including transfers made by Purchaser to the Certificate Trust pursuant to the Pooling and Servicing Agreement and to the Note Trust pursuant to the Transfer and Servicing Agreement. RPA Seller agrees to cooperate with Purchaser, Servicer and Receivables Trust Trustee in attempting to cure any such breach.
Section 4.3 REPRESENTATIONS AND WARRANTIES OF PURCHASER.
(a) REPRESENTATIONS AND WARRANTIES. As of the Effective Date and each Closing Date, Purchaser hereby represents and warrants to, and agrees with, RPA Seller that:
(i) ORGANIZATION AND GOOD STANDING. Purchaser is a limited liability company validly existing in good standing under the laws of the State of Delaware and has full power and authority to own its properties and conduct its business as presently owned and conducted and to execute, deliver and perform its obligations under this Agreement and the Conveyance Papers.
(ii) DUE AUTHORIZATION. The execution and delivery of this Agreement and the Conveyance Papers and the consummation of the transactions provided for in this Agreement and the Conveyance Papers have been duly authorized by Purchaser by all necessary limited liability company action on the part of Purchaser.
(iii) NO CONFLICT. The execution and delivery of this Agreement and the Conveyance Papers, the performance of the transactions contemplated by this Agreement and the Conveyance Papers, and the fulfillment of the terms hereof and thereof, will not conflict with, result in any breach of any of the material terms and provisions of, or constitute (with or without notice or lapse of time or both) a material default under, any indenture, contract, agreement, mortgage, deed of trust or other instrument to which Purchaser is a party or by which it or any of its properties are bound.
(iv) NO VIOLATION. The execution, delivery and performance of this Agreement and the Conveyance Papers by Purchaser and the fulfillment by Purchaser of the terms contemplated herein and therein will not conflict with or violate any Requirements of Law applicable to Purchaser.
(v) NO PROCEEDINGS. There are no proceedings or investigations pending or, to the best knowledge of Purchaser, threatened against Purchaser, before any court, regulatory body, administrative agency, or other tribunal or
governmental instrumentality (i) asserting the invalidity of this Agreement or any of the Conveyance Papers, (ii) seeking to prevent the consummation of any of the transactions contemplated by this Agreement or any of the Conveyance Papers, (iii) seeking any determination or ruling that, in the reasonable judgment of Purchaser, would materially and adversely affect the performance by Purchaser of its obligations under this Agreement or any of the Conveyance Papers or (iv) seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Agreement or any of the Conveyance Papers.
(vi) ALL CONSENTS REQUIRED. All approvals, authorizations, consents, orders or other actions of any Person or of any governmental body or official required in connection with the execution and delivery by Purchaser of this Agreement and Conveyance Papers, the performance by Purchaser of the transactions contemplated by this Agreement and the Conveyance Papers and the fulfillment by Purchaser of the terms hereof and thereof, have been obtained.
(b) NOTICE OF BREACH. The representations and warranties of RPA Seller set forth in this SECTION 4.3 shall survive the transfer and assignment by RPA Seller of the Receivables to Purchaser. Upon discovery by RPA Seller or Purchaser of a breach of any of the representations and warranties by Purchaser set forth in this SECTION 4.3, the party discovering such breach shall give prompt written notice to Receivables Trust Trustee, the Owner Trustee, and to each Enhancement Provider, if any, entitled thereto pursuant to the relevant Supplement. Purchaser agrees to cooperate with RPA Seller, Servicer and Receivables Trust Trustee in attempting to cure any such breach. For purposes of the representations and warranties set forth in this SECTION 4.3, each reference to a Supplement shall be deemed to refer only to those Supplements in effect as of the relevant Closing Date.
ARTICLE V
COVENANTS
Section 5.1 RPA SELLER COVENANTS. RPA Seller hereby covenants and agrees with Purchaser as follows:
(a) RECEIVABLES NOT TO BE EVIDENCED BY PROMISSORY NOTES. Except in connection with the enforcement or collection of an Account, RPA Seller will take no action to cause any Receivable transferred by it pursuant hereto to be evidenced by any "instrument," and, if any such Receivable is so evidenced (whether or not in connection with the enforcement or collection of an Account), it shall be deemed to be an Ineligible Receivable in accordance with SECTION 6.1.
(b) SECURITY INTERESTS. Except for the conveyances hereunder or as otherwise provided herein, RPA Seller will not sell, pledge, assign or transfer to any other Person, or grant, create, incur, assume or suffer to exist, any Lien on any Receivable, whether now existing or hereafter created, or any interest therein; and RPA Seller will
immediately notify Purchaser of the existence of any Lien on any Receivable of which RPA Seller has knowledge; and RPA Seller shall defend the right, title and interest of Purchaser in, to and under the Receivables, whether now existing or hereafter created, against all claims of third parties claiming through or under RPA Seller; PROVIDED that nothing in this SECTION 5.1(b) shall prevent or be deemed to prohibit RPA Seller from suffering to exist upon any of the Receivables any Lien for taxes if such taxes shall not at the time be due and payable or if RPA Seller shall currently be contesting the validity thereof in good faith by appropriate proceedings and shall have set aside on its books adequate reserves with respect thereto.
(c) DELIVERY OF COLLECTIONS OR RECOVERIES. If RPA Seller receives Collections or Recoveries, RPA Seller agrees to pay to Purchaser (or the Servicer if Purchaser so directs) all such Collections and Recoveries as soon as practicable after receipt thereof but in no event later than two Business Days after the Date of Processing by RPA Seller; PROVIDED that for so long as RPA Seller is acting as Servicer pursuant to the applicable Transfer Agreement, RPA Seller shall apply Collections and Recoveries received by it in accordance with the applicable Transfer Agreement.
(d) NOTICE OF LIENS. RPA Seller shall notify Purchaser promptly after becoming aware of any Lien on any Receivable other than the conveyances hereunder or under the Pooling and Servicing Agreement, the Transfer and Servicing Agreement or the Indenture or any Lien permitted under SECTION 5.1(b) hereof, SECTION 2.7(B) of the Pooling and Servicing Agreement or SECTION 2.5(b) of the Transfer and Servicing Agreement.
(e) DOCUMENTATION OF TRANSFER. RPA Seller shall cause to be executed,
filed and delivered to Trustee (with copies to Purchaser) any documents
(including financing statements and/or continuation statements under the UCC)
that would be necessary to perfect and maintain the security interest in and to
the Existing Assets, the Receivables and the Related Assets contemplated by this
Agreement.
(f) APPROVAL. The execution, delivery and performance of RPA Seller's obligations under this Agreement, and the transactions contemplated hereby, have been duly approved by RPA Seller's Board of Directors.
(g) SALE. RPA Seller agrees to treat the conveyance of the Receivables to Purchaser hereunder as a sale for all purposes (including all tax and financial accounting purposes).
(h) CONTINUOUS PERFECTION. RPA Seller shall not change its name, identity or structure in any manner that might cause any financing or continuation statement filed pursuant to this Agreement to be misleading unless RPA Seller shall have delivered to Purchaser at least 30 days prior written notice thereof and, no later than 30 days after making such change, shall have taken all action necessary or advisable to amend such financing statement or continuation statement so that it is not misleading. RPA Seller shall not change the jurisdiction under whose laws it is organized, its chief executive office or change the location of its principal records concerning the Receivables or the
Collections unless it has delivered to Purchaser at least 30 days prior written notice of its intention to do so and has taken such action as is necessary or advisable to cause the interest of Purchaser in the Receivables and other Related Assets to continue to be perfected with the priority required by this Agreement.
(i) CREDIT CARD AGREEMENTS AND GUIDELINES. RPA Seller shall comply with and perform its obligations under the Credit Card Agreements relating to the Accounts and the Credit Card Guidelines except insofar as any failure to comply or perform would not materially or adversely affect the rights of the Receivables Trust, the Issuer, the Investor Holders or the Noteholders. RPA Seller may change the terms and provisions of the Credit Card Agreements or the Credit Card Guidelines in any respect (including the reduction of the required minimum monthly payment, the calculation of the amount, or the timing, of charge offs and Periodic Finance Charges and other fees assessed thereon), but only if such change is made applicable to any comparable segment of the revolving credit card accounts owned and serviced by RPA Seller which have characteristics the same as, or substantially similar to, the Accounts that are the subject of such change, except as otherwise restricted by an endorsement, sponsorship or other agreement between RPA Seller and an unrelated third party or by the terms of the Credit Card Agreements. In addition, except as otherwise required by any Requirement of Law, or as is deemed by RPA Seller to be necessary in order for RPA Seller to maintain its credit card business, based upon a good faith assessment by RPA Seller, in its sole discretion, of the nature of the competition in the credit card business, RPA Seller shall not at any time reduce the Periodic Finance Charges assessed on any Receivable or other fees on any Account if, as a result of such reduction, Transferor's reasonable expectation of the Portfolio Yield (as defined in any Supplement) as of such date would be less than the then Base Rate (as defined in such Supplement).
(j) INSURED STATUS UNDER THE FDIA. RPA Seller shall preserve its status as an insured bank under the FDIA by insuring its deposits with the FDIC in accordance with the provisions of the FDIA and FDIC regulations.
(k) SEPARATE CORPORATE EXISTENCE. The RPA Seller hereby acknowledges that the Certificate Trust Trustee, the Indenture Trustee, the Holders and the Issuer are, and will be, entering into the transactions contemplated by the Transaction Documents in reliance upon Purchaser's identity as a legal entity separate from RPA Seller, the Servicer and any other Person. Therefore, RPA Seller shall take all reasonable steps to maintain its existence as a corporation separate and apart from Purchaser and to make it apparent to third parties that the is an entity with assets and liabilities distinct from those of Purchaser and that Purchaser is not a division of RPA Seller.
ARTICLE VI
REPURCHASE OBLIGATION
Section 6.1 REASSIGNMENT OF INELIGIBLE RECEIVABLES. If (a) any representation or warranty under SECTION 4.2(a)(ii), (iii), (iv), (vii), (viii) or (ix) is not true and correct in any material respect as of the date specified therein with respect to any Receivable or
any related Account or (b) any representation or warranty made by RPA Seller
pursuant to SECTION 2.4(a)(ii), (iii), (iv), (vii), (viii) or (ix) of the
Existing PSA is not true and correct in any material respect as of the date
specified therein with respect to any Receivable transferred to the Certificate
Trust prior to the Effective Date or any related Account and, in either case, as
a result thereof Purchaser is required to accept a reassignment of Ineligible
Receivables pursuant to SECTION 2.5 of the Pooling and Servicing Agreement or
SECTION 2.4(d) of the Transfer and Servicing Agreement, RPA Seller shall pay to
Purchaser an amount in cash equal to either (i) the Purchase Price paid for any
such Ineligible Receivable by Purchaser to RPA Seller (including any portion
thereof deemed to be a borrowing under the Subordinated Note or deemed to be a
capital contribution from RPA Seller to Purchaser) or (ii) in the case of any
Receivable that was deemed to have been sold to Purchaser by RPA Seller prior to
the Effective Date, the principal balance of such Receivable. Such amount may be
offset against any amounts due from Purchaser to RPA Seller with respect to the
Purchase Price for Receivables sold to Purchaser on such day; PROVIDED that RPA
Seller shall not be obligated to make any such cash payment until the
Distribution Date following a Monthly Period with respect to amounts owing for
such Monthly Period in accordance with SECTION 3.3. The obligation of RPA Seller
set forth in this Section shall constitute the sole remedy respecting any breach
of the representations and warranties set forth in the above-referenced Sections
or failure to meet the conditions set forth in the definition in the Pooling and
Servicing Agreement or the Indenture of Eligible Receivable with respect to such
Receivable available to Purchaser.
Section 6.2 REASSIGNMENT OF HOLDERS' INTEREST IN TRUST PORTFOLIO. If (a)
any representation or warranty set forth in SECTION 4.1(a)(i), (ii) or (iii) or
SECTION 4.2(a)(i), (v) or (vi) is not true and correct in any material respect
or (b) any representation or warranty made by RPA Seller pursuant to SECTION
2.3(a), (b) or (c) of the Existing PSA or SECTION 2.4(a)(i), (v) or (vi) of the
Existing PSA with respect to any Receivable transferred to the Certificate Trust
prior to the Effective Date or any related Account is not true and correct in
any material respect and, in either case, as a result thereof Purchaser is
required to accept a reassignment of the Receivables transferred to the
Receivables Trust by Purchaser pursuant to SECTION 2.6 of the Pooling and
Servicing Agreement or SECTION 2.4(f) of the Transfer and Servicing Agreement,
RPA Seller shall be obligated to accept a reassignment of Purchaser's interest
in such Receivables on the terms set forth below.
RPA Seller shall pay to Purchaser by depositing in the Collection Account in same-day funds, not later than 10:00 A.M. New York City time, on the Transfer Date following the Monthly Period in which such reassignment obligation arises, in payment for such reassignment, an amount equal to the Portfolio Reassignment Price. The obligation of RPA Seller set forth in this Section shall constitute the sole remedy respecting any breach of the representations and warranties set forth in the above-referenced Sections available to Purchaser.
Section 6.3 CONVEYANCE OF REASSIGNED RECEIVABLES. Upon the request of RPA Seller, Purchaser shall execute and deliver to RPA Seller a reconveyance substantially in such form and upon such terms as shall be acceptable to RPA Seller,
pursuant to which Purchaser evidences the conveyance to RPA Seller of all of Purchaser's right, title, and interest in any Receivables reconveyed to RPA Seller pursuant to SECTIONS 6.1 and 6.2. Purchaser shall (and shall cause Receivables Trust Trustee to) execute such other documents or instruments of conveyance or take such other actions as RPA Seller may reasonably require to effect any repurchase of Receivables pursuant to this ARTICLE VI.
ARTICLE VII
CONDITIONS PRECEDENT
Section 7.1 CONDITIONS TO PURCHASE. The obligations of Purchaser to make its initial purchase of Receivables hereunder shall be subject to RPA Seller delivering to Purchaser on or before the Effective Date such document, certificates and resolutions that Purchaser is required to deliver to the Certificate Trust Trustee, any Enhancement Provider or any Rating Agency in connection with the amendment and restatement of the Pooling and Servicing Agreement on the date of this Agreement.
Section 7.2 CONDITIONS TO PURCHASER'S OBLIGATIONS REGARDING ADDITIONAL RECEIVABLES. The obligations of Purchaser to purchase any Receivables created on or after the Effective Date shall be subject to the satisfaction of the following conditions:
(a) All representations and warranties of RPA Seller contained in this Agreement shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on the date of such purchase;
(b) All information (concerning any Account to which such Receivables relate) provided to Purchaser shall be true and correct in all material respects as of the date of such purchase; and
(c) RPA Seller shall have recorded and filed, at its expense, any UCC-1 or other financing statement as required as of the date of such purchase pursuant to SECTION 2.1(b).
Section 7.3 CONDITIONS PRECEDENT TO OBLIGATIONS OF RPA SELLER. The obligations of RPA Seller to sell on any date Receivables shall be subject to the satisfaction of the following conditions:
(a) All representations and warranties of Purchaser contained in this Agreement shall be true and correct in all material respects with the same effect as though such representations and warranties had been made on the date of such sale; and
(b) Payment or provision for payment of the Purchase Price in accordance with the provision of SECTIONS 3.1, 3.2 and 3.3 hereof shall have been made.
ARTICLE VIII
TERM AND PURCHASE TERMINATION
Section 8.1 TERM. This Agreement shall commence as of the date of
execution and delivery hereof and shall continue until the later of the
termination of the Certificate Trust as provided in ARTICLE XII of the Pooling
and Servicing Agreement or the termination of the Note Trust as provided in
SECTION 8.1 of the Trust Agreement.
Section 8.2 PURCHASE TERMINATION. If an Insolvency Event shall occur with respect to RPA Seller, then RPA Seller shall immediately cease to transfer Principal Receivables to Purchaser and shall promptly give notice to Purchaser and Receivables Trust Trustee of such Insolvency Event. Notwithstanding any cessation of the transfer to Purchaser of additional Principal Receivables, Principal Receivables transferred to Purchaser prior to the occurrence of such Insolvency Event and Collections in respect of such Principal Receivables and Finance Charge Receivables whenever created, accrued in respect of such Principal Receivables, shall continue to be property of Purchaser transferable by Purchaser to the Receivables Trust pursuant to the Pooling and Servicing Agreement or the Transfer and Servicing Agreement, as applicable.
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.1 AMENDMENT. This Agreement and any Conveyance Papers and the
rights and obligations of the parties hereunder may not be changed orally, but
only by an instrument in writing signed by Purchaser and RPA Seller in
accordance with this SECTION 9.1. This Agreement and any Conveyance Papers may
be amended from time to time by Purchaser and RPA Seller (i) to cure any
ambiguity, (ii) to correct or supplement any provisions herein which may be
inconsistent with any other provisions herein or in any such other Conveyance
Papers, (iii) to add any other provisions with respect to matters or questions
arising under this Agreement or any Conveyance Papers that shall not be
inconsistent with the provisions of this Agreement or any Conveyance Papers,
(iv) to change or modify the Purchase Price, (v) to change, modify, delete or
add any other obligation of RPA Seller or Purchaser and (vi) to provide for the
transfer by RPA Seller or Purchaser of its interest in and to all or part of the
Accounts in accordance with the provisions of the Pooling and Servicing
Agreement or the Transfer and Servicing Agreement (if such transfer is for less
than all of the Accounts, the respective rights, duties and obligations of
Purchaser, RPA Seller and Servicer will be determined at the time of such
transfer); PROVIDED that no amendment pursuant to CLAUSE (v) of this SECTION 9.1
shall be effective unless RPA Seller and Purchaser have been notified in writing
that the Rating Agency Condition has been satisfied. Any reconveyance executed
in accordance with the provisions hereof shall not be considered to be an
amendment to this Agreement. A copy of any amendment to this Agreement shall be
sent to Trustee and each Rating Agency.
SECTION 9.2 GOVERNING LAW. THIS AGREEMENT AND THE CONVEYANCE PAPERS SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
Section 9.3 NOTICES. All demands, notices, instructions, directions and communications under this Agreement shall be in writing and shall be deemed to have been duly given if personally delivered at, mailed by registered mail, return receipt requested, or sent by facsimile transmission to (a) in the case of Purchaser, to WFN Credit Company, LLC, 220 West Schrock Road, Westerville, Ohio 43801, Attention: President, (b) in the case of RPA Seller, to World Financial Network National Bank, 800 Techcenter Drive, Gahanna, Ohio 43230, Attention: President, (c) in the case of the Certificate Trust Trustee or the Indenture Trustee, to BNY Midwest Trust Company, 2 North LaSalle Street, Suite 1020, Chicago, Illinois 60602, Attention: Structured Finance Services and (d) in the case of the Rating Agency for a particular Series, the address, if any, specified in the Supplement relating to such Series.
Section 9.4 SEVERABILITY OF PROVISIONS. If any one or more of the covenants, agreements, provisions or terms of this Agreement or any Conveyance Paper shall for any reason whatsoever be held invalid, then such covenants, agreements, provisions, or terms shall be deemed severable from the remaining covenants, agreements, provisions, and terms of this Agreement or any Conveyance Paper and shall in no way affect the validity or enforceability of the other provisions of this Agreement or of any Conveyance Paper.
Section 9.5 MERGER OR CONSOLIDATION OF, OR ASSUMPTION OF THE OBLIGATIONS OF, RPA SELLER. (a) RPA Seller shall not consolidate with or merge into any other corporation or convey or transfer its properties and assets substantially as an entirety to any Person unless:
(i) the Person formed by such consolidation or into which RPA Seller is merged or the Person which acquires by conveyance or transfer the properties and assets of RPA Seller substantially as an entirety shall be, if RPA Seller is not the surviving entity, an entity organized and existing under the laws of the United States of America or any State or the District of Columbia, and, if RPA Seller is not the surviving entity, such entity shall expressly assume, by an agreement supplemental hereto, executed and delivered to Purchaser and Receivables Trust Trustee, in form reasonably satisfactory to Purchaser and Receivables Trust Trustee, the performance of every covenant and obligation of RPA Seller hereunder;
(ii) RPA Seller has delivered to Purchaser and Receivables Trust Trustee (A) an Officer's Certificate stating that such consolidation, merger, conveyance or transfer and such supplemental agreement comply with this Section and that all conditions precedent herein provided for relating to such
transaction have been complied with, and (B) an Opinion of Counsel to the effect that such supplemental agreement is a valid and binding obligation of such surviving entity enforceable against such surviving entity in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting creditors' rights generally from time to time in effect and except as such enforceability may be limited by general principles of equity (whether considered in a suit at law or in equity);
(iii) RPA Seller shall have delivered to Purchaser and Receivables Trust Trustee and each Rating Agency a Tax Opinion, dated the date of such consolidation, merger, conveyance or transfer, with respect thereto;
(iv) if Transferor is not the surviving entity, the surviving entity shall file new UCC-1 financing statements with respect to the interest of Purchaser in the Receivables; and
(v) satisfaction of the Rating Agency Condition.
(b) This SECTION 9.5 shall not be construed to prohibit or in any way limit RPA Seller's ability to effectuate any consolidation or merger pursuant to which RPA Seller would be surviving entity.
(c) RPA Seller shall notify each Rating Agency promptly after any consolidation, merger, conveyance or transfer effected pursuant to this SECTION 9.5;
(d) The obligations of RPA Seller hereunder shall not be assignable nor
shall any Person succeed to the obligations of RPA Seller hereunder except in
each case in accordance with (i) the provisions of the foregoing paragraphs or
(ii) conveyances, mergers, consolidations, assumptions, sales or transfers to
other entities (1) for which RPA Seller delivers an Officer's Certificate to
Purchaser and Receivables Trust Trustee indicating that RPA Seller reasonably
believes that such action will not adversely affect in any material respect the
interests of Purchaser or any Noteholder, (2) which meet the requirements of
CLAUSE (ii) of PARAGRAPH (a) and (3) for which such purchaser, transferee,
pledgee or entity shall expressly assume, in an agreement supplemental hereto,
executed and delivered to Purchaser and Receivables Trust Trustee in writing in
form satisfactory to RPA Seller and Receivables Trust Trustee, the performance
of every covenant and obligation of RPA Seller thereby conveyed.
Section 9.6 ACKNOWLEDGEMENT AND AGREEMENT OF RPA SELLER. (a) By execution below, RPA Seller expressly acknowledges and agrees that all of Purchaser's right, title, and interest in, to, and under this Agreement, including all of Purchaser's right, title, and interest in and to the Receivables purchased pursuant to this Agreement, will be assigned by Purchaser to the Certificate Trust Trustee for the benefit of the Holders and after the Certificate Trust Termination Date will be assigned by Purchaser to the Note Trust, and RPA Seller consents to such assignment. Additionally, RPA Seller agrees for the benefit of the Certificate Trust Trustee, the Holders and the Note
Trust that any amounts payable by RPA Seller to Purchaser hereunder which are to be paid by Purchaser to Receivables Trust Trustee for the benefit of the Holders shall be paid by RPA Seller, on behalf of Purchaser, directly to Receivables Trust Trustee. Any payment required to be made on or before a specified date in same-day funds may be made on the prior business day in next-day funds.
(b) To the extent that RPA Seller retains any interest in the Receivables now existing and arising from time to time in the Accounts and the Related Assets, RPA Seller hereby grants to (a) the Certificate Trust Trustee for the benefit of the Investor Certificateholders and (b) effective as of the Certificate Trust Termination Date, the Indenture Trustee for benefit of the Noteholders, a security interest in all of RPA Seller's right, title and interest, whether now owned or hereafter arising, in, to and under (i) the Receivables existing at the opening of business on the Effective Date and arising from the Accounts and all Related Assets with respect to such Receivables and (ii) the Receivables now existing and arising from time to time in the Accounts and the Related Assets with respect thereto (other than the Existing Assets), (iii) its right to receive Merchant Adjustment Payments from any Merchant, (iv) any collateral security granted to, or guaranty for the benefit of, RPA Seller with respect to Merchant Adjustment Payments, (v) all amounts received from any Merchant on account of Merchant Adjustment Payments and (vi) all proceeds of such rights and such amounts, to secure the performance of all of the obligations of RPA Seller hereunder, under the Pooling and Servicing Agreement, the Indenture and the other Transaction Documents.
Section 9.7 FURTHER ASSURANCES. Each of Purchaser and RPA Seller agrees 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 each other and by their respective permitted successors and assigns in order to more fully to effect the purposes of this Agreement and the Conveyance Papers, including the execution of any UCC financing statements or continuation statements or equivalent documents relating to the Receivables for filing under the provisions of the UCC or other law of any applicable jurisdiction.
Section 9.8 NONPETITION COVENANT. Notwithstanding any prior termination of this Agreement, RPA Seller shall not, at any time, institute against, solicit or join or cooperate with or encourage any institution against Purchaser of, any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings or other similar proceedings under any United States federal or state bankruptcy or similar law.
Section 9.9 NO WAIVER; CUMULATIVE REMEDIES. No failure to exercise and no delay in exercising, on the part of Purchaser or RPA Seller, any right, remedy, power or privilege hereunder, shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy, power or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power or privilege. The rights, remedies, powers and privileges herein provided are cumulative and not exhaustive of any rights, remedies, powers and privileges provided by law.
Section 9.10 COUNTERPARTS. This Agreement and all Conveyance Papers 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 9.11 BINDING THIRD-PARTY BENEFICIARIES. This Agreement and the Conveyance Papers will inure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns. The parties hereto intend that the Certificate Trustee, the Note Trust and the Indenture Trustee shall be third-party beneficiaries of this Agreement.
Section 9.12 MERGER AND INTEGRATION. Except as specifically stated otherwise herein, this Agreement and the Conveyance Papers set forth the entire understanding of the parties relating to the subject matter hereof, and all prior understandings, written or oral, are superseded by this Agreement and the Conveyance Papers.
Section 9.13 SCHEDULES AND EXHIBITS. The schedules and exhibits attached hereto and referred to herein shall constitute a part of this Agreement and are incorporated into this Agreement for all purposes.
IN WITNESS WHEREOF, Purchaser and RPA Seller have caused this Agreement to be duly executed by their respective officers as of the day and year first above written.
WFN CREDIT COMPANY, LLC,
as Purchaser
By: /s/ Robert P. Armiak
-----------------------------------
Name: Robert P. Armiak
Title: Vice President and Treasurer
|
WORLD FINANCIAL NETWORK
NATIONAL BANK, as RPA Seller
By: /s/ Robert P. Armiak
-----------------------------------
Name: Robert P. Armiak
Title: Vice President and Treasurer
|
Acknowledged and Accepted:
BNY MIDWEST TRUST COMPANY,
as Certificate Trust Trustee and
as Indenture Trustee
By: /s/ Eric Lindahl
--------------------------------
Name: Eric Lindahl
Title: Assistant Vice President
|
EXHIBIT A
FORM OF SUPPLEMENTAL CONVEYANCE
(As required by Section 2.2 of
the Receivables Purchase Agreement)
SUPPLEMENTAL CONVEYANCE NO. ______ dated as of ___________ 20_, by and between WORLD FINANCIAL NETWORK NATIONAL BANK ("RPA SELLER") and WFN CREDIT COMPANY, LLC, ("PURCHASER") pursuant to the Receivables Purchase Agreement referred to below.
WITNESSETH:
WHEREAS, RPA Seller and Purchaser are parties to a Receivables Purchase Agreement, dated as of August 1, 2001 (hereinafter as such agreement may have been, or may from time to time be, amended, supplemented or otherwise modified, the "RECEIVABLES PURCHASE AGREEMENT");
WHEREAS, pursuant to the Receivables Purchase Agreement, RPA Seller wishes to designate Supplemental Accounts to be included as Accounts and RPA Seller wishes to convey the Receivables of such Supplemental Accounts, whether now existing or hereafter created, to Purchaser pursuant to the Receivables Purchase Agreement (as each such term is defined in the Receivables Purchase Agreement); and
WHEREAS, Purchaser is willing to accept such designation and conveyance subject to the terms and conditions hereof.
NOW, THEREFORE, RPA Seller and Purchaser hereby agree as follows:
1. DEFINED TERMS. Each capitalized term used herein shall have the meanings specified in the Receivables Purchase Agreement unless otherwise defined herein.
"ADDITION DATE" shall mean, with respect to the Supplemental Accounts designated hereby, _________ 200_.
2. DESIGNATION OF SUPPLEMENTAL ACCOUNTS. RPA Seller delivers herewith an Account Schedule containing a true and complete schedule identifying all such Supplemental Accounts and specifying for each such Account, as of the Additional Cut Off Date, its account number, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables in such Account. Such Account Schedule shall be, as of the date of this Supplemental Conveyance, incorporated into and made part of this Supplemental Conveyance and is marked as Schedule I to this Supplemental Conveyance.
3. CONVEYANCE OF RECEIVABLES.
(a) RPA Seller sells, transfers, assigns, sets over and otherwise conveys to Purchaser (collectively, the "CONVEYANCE"), without recourse, all of its right, title and interest in, to and under the Receivables generated by such Supplemental Accounts, now existing and hereafter arising, all Recoveries allocable to such Supplemental Accounts and all monies due or to become due thereunder and all amounts received with respect thereto and all proceeds thereof. The foregoing sale, transfer, assignment, set-over and conveyance does not constitute and is not intended to result in a creation or an assumption by Purchaser of any obligation of Servicer, RPA Seller or any other Person in connection with the Accounts, the Receivables or under any agreement or instrument relating thereto.
(b) In connection with the Conveyance and in accordance with SECTION 2.1(B) of the Receivables Purchase Agreement, RPA Seller agrees to record and file, at its own expense, one or more UCC financing statements (and continuation statements with respect to such financing statements when applicable) with respect to the Receivables, now existing and hereafter created, for the sale of accounts meeting the requirements of applicable state law in such manner and in such jurisdictions as may be necessary or advisable to perfect or evidence the sale and assignment of the Receivables to Purchaser, and to deliver a file-stamped copy of such financing statement or other evidence of such filing to Purchaser.
(c) In connection with such sale, RPA Seller further agrees, at its own expense, on or prior to the date of this Supplemental Conveyance, to indicate in its appropriate computer files or other records that all Receivables created in connection with the Supplemental Accounts designated hereby have been conveyed to Purchaser pursuant to this Supplemental Conveyance.
4. ACCEPTANCE BY PURCHASER. Subject to the satisfaction of the conditions set forth in SECTION 6 of this Supplemental Conveyance, Purchaser hereby acknowledges its acceptance of all right, title and interest to the property, now existing and hereafter arising, conveyed to Purchaser pursuant to SECTION 3(A) of this Supplemental Conveyance, and declares that it shall maintain such right, title and interest. Purchaser further acknowledges that, prior to or simultaneously with the execution and delivery of this Supplemental Conveyance, RPA Seller delivered to Purchaser the Account Schedule described in SECTION 2 of this Supplemental Conveyance.
5. REPRESENTATIONS AND WARRANTIES OF RPA SELLER. RPA Seller hereby represents and warrants to Purchaser as of the date of this Supplemental Conveyance and as of the Addition Date that:
(a) LEGAL, VALID AND BINDING OBLIGATION. This Supplemental Conveyance constitutes a legal, valid and binding obligation of RPA Seller
enforceable against RPA Seller in accordance with its terms, except as such enforceability may be limited by applicable Debtor Relief Laws now or hereinafter in effect and by general principles of equity (whether considered in a suit at law or in equity);
(b) ELIGIBILITY OF ACCOUNTS. Each Supplemental Account designated hereby is an Eligible Account;
(c) SELECTION PROCEDURES. No selection procedure was used by RPA Seller which would result in a selection of Supplemental Accounts that would have a result that would be materially less favorable to the interests of Purchaser or the Investor Holders of any Series as of the Addition Date than a random selection;
(d) INSOLVENCY. RPA Seller is not insolvent and, after giving effect to the conveyance set forth in Section 3 of this Supplemental Conveyance, will not be insolvent;
(e) SALE OF RECEIVABLES. This Supplemental Conveyance constitutes a valid sale, transfer and assignment to Purchaser of all right, title and interest of RPA Seller in the Receivables and other Related Assets now existing or hereafter arising, all monies due or to become due and all amounts received with respect thereto and the proceeds thereof, relating thereto;
(f) NO CONFLICT. The execution and delivery of this Supplemental Conveyance, the performance of the transactions contemplated by this Supplemental Conveyance and the fulfillment of the terms hereof, will not conflict with, result in any breach of any of the material terms and provisions of, or constitute (with or without notice or lapse of time or both) a material default under, any indenture, contract, agreement, mortgage, deed of trust or other instrument to which RPA Seller is a party or by which it or its properties are bound;
(g) NO VIOLATION. The execution and delivery of this Supplemental Conveyance by RPA Seller, the performance of the transactions contemplated by this Supplemental Conveyance and the fulfillment of the terms hereof applicable to RPA Seller will not conflict with or violate any Requirements of Law applicable to RPA Seller;
(h) NO PROCEEDINGS. There are no proceedings or investigations, pending or, to the best knowledge of RPA Seller, threatened against RPA Seller before any court, regulatory body, administrative agency or other tribunal or governmental instrumentality (i) asserting the invalidity of the Receivables Purchase Agreement or this Supplemental Conveyance, (ii) seeking to prevent the consummation of any of the transactions contemplated by the Receivables Purchase Agreement or this Supplemental Conveyance, (iii) seeking any determination or ruling that, in the reasonable judgment of RPA Seller, would
materially and adversely affect the performance of RPA Seller of its obligations under the Receivables Purchase Agreement or this Supplemental Conveyance or (iv) seeking any determination or ruling that would materially and adversely affect the validity or enforceability of this Supplemental Conveyance; and
(i) ALL CONSENTS. All authorizations, consents, orders or approvals of any court or other governmental authority required to be obtained by RPA Seller in connection with the execution and delivery of this Supplemental Conveyance by RPA Seller and the performance of the transactions contemplated by this Supplemental Conveyance by RPA Seller, have been obtained.
6. CONDITIONS PRECEDENT. The acceptance of Purchaser set forth in SECTION 4 of this Supplemental Conveyance is subject to the satisfaction, on or prior to the Addition Date, of the following conditions precedent:
(a) REPRESENTATIONS AND WARRANTIES. Each of the representations and warranties made by RPA Seller in SECTION 5 of this Supplemental Conveyance shall be true and correct in all material respects as of the date of this Supplemental Conveyance and as of the Addition Date;
(b) OFFICER'S CERTIFICATE. RPA Seller shall have delivered to Purchaser an Officer's Certificate confirming that (i) the Supplemental Accounts shall be Eligible Accounts or specify which, if any, of such Accounts are not Eligible Accounts and (ii) (A) no selection procedure was used by RPA Seller or Purchaser which would result in a selection of Supplemental Accounts that would have a result that would be materially less favorable to the interests of the Investor Holders of any Series as of the Addition Date than a random selection; and (B) the list of Supplemental Accounts, as of the Additional Cut Off Date, is a true and complete schedule identifying all such Supplemental Accounts and specifies for each such Account, as of the Additional Cut Off Date, its account number, the aggregate amount outstanding in such Account and the aggregate amount of Principal Receivables in such Account; and
(c) ADDITIONAL INFORMATION. RPA Seller shall have delivered to
Purchaser such information as was reasonably requested by Purchaser to satisfy
itself as to the accuracy of the representation and warranty set forth in
Section 5(d) of this Supplemental Conveyance.
7. Ratification of the Receivables Purchase Agreement. The Receivables Purchase Agreement is hereby ratified, and all references to the "RECEIVABLES PURCHASE AGREEMENT," to "THIS AGREEMENT" and "HEREIN" shall be deemed from and after the Addition Date to be a reference to the Receivables Purchase Agreement as supplemented by this Supplemental Conveyance. Except as expressly amended hereby, all the representations, warranties, terms, covenants and conditions of the Receivables Purchase Agreement shall remain unamended and shall continue to be, and shall, remain, in full force and effect in accordance with its terms and except as expressly provided herein shall not constitute or be
deemed to constitute a waiver of compliance with or consent to non-compliance with any term or provision of the Receivables Purchase Agreement.
8. Counterparts. This Supplemental Conveyance may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument.
IN WITNESS WHEREOF, the undersigned have caused this Supplemental Conveyance to be duly executed and delivered by their respective duly authorized officers on the day and the year first above written.
WFN CREDIT COMPANY, LLC,
as Purchaser
By: ____________________________________
Name:
Title
WORLD FINANCIAL NETWORK
NATIONAL BANK, as RPA Seller
By: ____________________________________
Name:
Title
Schedule I to Supplemental Conveyance
SUPPLEMENTAL ACCOUNTS
EXHIBIT B
SUBORDINATED NOTE
FOR VALUE RECEIVED, the undersigned, a Delaware limited liability company ("PURCHASER"), hereby unconditionally promises to pay to the order of WORLD FINANCIAL NETWORK NATIONAL BANK ("WFN") in lawful money of the United States of America in immediately available funds on the Subordinated Note Maturity Date, the aggregate unpaid amount (as shown in the records of RPA Seller or, at the RPA Seller's option, on the schedule attached hereto and any continuation thereof) of all borrowings made by Purchaser from RPA Seller to fund the acquisition of Receivables in connection with the transactions contemplated by the Receivables Purchase Agreement, dated as of August 1, 2001 (as amended and supplemented from time to time, the "RECEIVABLES PURCHASE AGREEMENt"), among Purchaser and RPA Seller. Purchaser may at its option prepay this Note in whole or in part at any time and from time to time; provided that in no event shall the holder hereof have any right to demand any payment of principal hereunder prior to the Subordinated Note Maturity Date.
Capitalized terms used and not otherwise defined herein have the meanings assigned to them in the Receivables Purchase Agreement.
The undersigned further agrees to pay interest from the date hereof on the unpaid principal amount hereof from time to time at the rate and at the times specified in the Receivables Purchase Agreement. Interest shall be payable in arrears on each Interest Payment Date and upon final payment of the unpaid principal amount hereof.
This Note is subordinate and junior in right and time of payment to all "SENIOR DEBT" of Purchaser, which is any Indebtedness of Purchaser and all renewals, extensions, refinancings and refundings thereof, except any such Indebtedness that expressly provides that it is not senior or superior in right of payment hereto. "INDEBTEDNESS" is any indebtedness, whether or not contingent, in respect of borrowed money or evidenced by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereto) and guarantees of any of the foregoing, whether or not any such indebtedness would appear as a liability on a balance sheet of Purchaser prepared on a consolidated basis in accordance with generally accepted accounting principles.
All scheduled payments of principal and interest in respect of Senior Debt must be paid before this Note shall be payable, and all scheduled payments of principal and interest on this Note shall be payable only to the extent that Purchaser, after paying all its accounts payable and other expenses and obligations, has the funds to make such payments. Purchaser agrees, and the
holder hereof by accepting this Note agrees, to the subordination provisions herein contained.
Upon prior written notice to Purchaser, the holder hereof may sell, pledge, assign or otherwise transfer this Note; PROVIDED, that prior to such sale, pledge, assignment or transfer, the Rating Agency Condition is satisfied.
This Note shall be governed by and construed in accordance with the laws of the State of New York.
The holder of this Note, by its acceptance hereof, hereby covenants and agrees that it will not at any time institute against Purchaser any bankruptcy, reorganization, arrangement, insolvency or liquidation proceedings, or other proceedings under any United States federal or state bankruptcy or similar law.
IN WITNESS WHEREOF, Purchaser has caused this Subordinated Note to be duly executed as of the day and year first above written.
WFN CREDIT COMPANY, LLC
By: ____________________________________
Name:
Title:
Schedule Attached to Note dated _________, __________ of WFN CREDIT COMPANY, LLC payable to the order of WORLD FINANCIAL NETWORK NATIONAL BANK.
Date and Amount Date and Amount Unpaid Principal of Borrowing of Repayment Balance Notation Made by |
Schedule I
ACCOUNT SCHEDULE
DEEMED INCORPORATED BY REFERENCE
Exhibit 4.9
(MULTICURRENCY--CROSS BORDER)
ISDA(R)
International Swap Dealers Association. Inc.
MASTER AGREEMENT
dated as of AUGUST 21, 2001
MORGAN GUARANTY TRUST COMPANY and WORLD FINANCIAL NETWORK CREDIT
OF NEW YORK CARD MASTER NOTE TRUST
have entered and/or anticipate entering into one or more transactions (each a "Transaction") that are or will be governed by this Master Agreement, which includes the schedule (the "Schedule"), and the documents and other confirming evidence (each a "Confirmation") exchanged between the parties confirming those Transactions.
Accordingly, the parties agree as follows:--
1. INTERPRETATION
(a) DEFINITIONS. The terms defined in Section 14 and in the Schedule will have the meanings therein specified for the purpose of this Master Agreement.
(b) INCONSISTENCY. In the event of any inconsistency between the provisions of the Schedule and the other provisions of this Master Agreement, the Schedule will prevail. In the event of any inconsistency between the provisions of any Confirmation and this Master Agreement (including the Schedule), such Confirmation will prevail for the purpose of the relevant Transaction.
(c) SINGLE AGREEMENT. All Transactions are entered into in reliance on the fact that this Master Agreement and all Confirmations form a single agreement between the parties (collectively referred to as this "Agreement"), and the parties would not otherwise enter into any Transactions.
2. OBLIGATIONS
(a) GENERAL CONDITIONS.
(i) Each party will make each payment or delivery specified in each Confirmation to be made by it, subject to the other provisions of this Agreement.
(ii) Payments under this Agreement will be made on the due date for value on that date in the place of the account specified in the relevant Confirmation or otherwise pursuant to this Agreement, in freely transferable funds and in the manner customary for payments in the required currency. Where settlement is by delivery (that is, other than by payment), such delivery will be made for receipt on the due date in the manner customary for the relevant obligation unless otherwise specified in the relevant Confirmation or elsewhere in this Agreement.
(iii) Each obligation of each party under Section 2(a)(i) is subject to
(1) the condition precedent that no Event of Default or Potential Event of
Default with respect to the other party has occurred and is continuing,
(2) the condition precedent that no Early Termination Date in respect of
the relevant Transaction has occurred or been effectively designated and
(3) each other applicable condition precedent specified in this Agreement.
Copyright(C)1992 by International Swap Dealers Association, Inc.
(b) CHANGE OF ACCOUNT. Either party may change its account for receiving a payment or delivery by giving notice to the other party at least five Local Business Days prior to the scheduled date for the payment or delivery to which such change applies unless such other party gives timely notice of a reasonable objection to such change.
(c) NETTING. If on any date amounts would otherwise be payable:--
(i) in the same currency; and
(ii) in respect of the same Transaction,
by each party to the other, then, on such date, each party's obligation to make payment of any such amount will be automatically satisfied and discharged and, if the aggregate amount that would otherwise have been payable by one party exceeds the aggregate amount that would otherwise have been payable by the other party, replaced by an obligation upon the party by whom the larger aggregate amount would have been payable to pay to the other party the excess of the larger aggregate amount over the smaller aggregate amount.
The parties may elect in respect of two or more Transactions that a net amount will be determined in respect of all amounts payable on the same date in the same currency in respect of such Transactions, regardless of whether such amounts are payable in respect of the same Transaction. The election may be made in the Schedule or a Confirmation by specifying that subparagraph (ii) above will not apply to the Transactions identified as being subject to the election, together with the starting date (in which case subparagraph (ii) above will not, or will cease to, apply to such Transactions from such date). This election may be made separately for different groups of Transactions and will apply separately to each pairing of Offices through which the parties make and receive payments or deliveries.
(d) DEDUCTION OR WITHHOLDING FOR TAX.
(i) GROSS-UP. All payments under this Agreement will be made without any deduction or withholding for or on account of any Tax unless such deduction or withholding is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, then in effect. If a party is so required to deduct or withhold, then that party ("X") will:--
(1) promptly notify the other party ("Y") of such requirement;
(2) pay to the relevant authorities the full amount required to be deducted or withheld (including the full amount required to be deducted or withheld from any additional amount paid by X to Y under this Section 2(d)) promptly upon the earlier of determining that such deduction or withholding is required or receiving notice that such amount has been assessed against Y;
(3) promptly forward to Y an official receipt (or a certified copy), or other documentation reasonably acceptable to Y, evidencing such payment to such authorities; and
(4) if such Tax is an Indemnifiable Tax, pay to Y, in addition to the payment to which Y is otherwise entitled under this Agreement, such additional amount as is necessary to ensure that the net amount actually received by Y (free and clear of Indemnifiable Taxes, whether assessed against X or Y) will equal the full amount Y would have received had no such deduction or withholding been required. However, X will not be required to pay any additional amount to Y to the extent that it would not be required to be paid but for:--
(A) the failure by Y to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d); or
(B) the failure of a representation made by Y pursuant to
Section 3(f) to be accurate and true unless such failure would
not have occurred but for (I) any action taken by a taxing
authority, or brought in a court of competent jurisdiction, on
or after the date on which a Transaction is entered into
(regardless of whether such action is taken or brought with
respect to a party to this Agreement) or (II) a Change in Tax
Law.
2 ISDA (R) 1992
(ii) LIABILITY. If:--
(1) X is required by any applicable law, as modified by the practice of any relevant governmental revenue authority, to make any deduction or withholding in respect of which X would not be required to pay an additional amount to Y under Section 2(d)(i)(4);
(2) X does not so deduct or withhold; and
(3) a liability resulting from such Tax is assessed directly against X,
then, except to the extent Y has satisfied or then satisfies the liability resulting from such Tax, Y will promptly pay to X the amount of such liability (including any related liability for interest, but including any related liability for penalties only if Y has failed to comply with or perform any agreement contained in Section 4(a)(i), 4(a)(iii) or 4(d)).
(e) DEFAULT INTEREST; OTHER AMOUNTS. Prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party that defaults in the performance of any payment obligation will, to the extent permitted by law and subject to Section 6(c), be required to pay interest (before as well as after judgment) on the overdue amount to the other party on demand in the same currency as such overdue amount, for the period from (and including) the original due date for payment to (but excluding) the date of actual payment, at the Default Rate. Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed. If, prior to the occurrence or effective designation of an Early Termination Date in respect of the relevant Transaction, a party defaults in the performance of any obligation required to be settled by delivery, it will compensate the other party on demand if and to the extent provided for in the relevant Confirmation or elsewhere in this Agreement.
3. REPRESENTATIONS
Each party represents to the other party (which representations will be deemed to be repeated by each party on each date on which a Transaction is entered into and, in the case of the representations in Section 3(f), at all times until the termination of this Agreement) that:--
(a) BASIC REPRESENTATIONS.
(i) STATUS. It is duly organised and validly existing under the laws of the jurisdiction of its organisation or incorporation and, if relevant under such laws, in good standing;
(ii) POWERS. It has the power to execute this Agreement and any other documentation relating to this Agreement to which it is a party, to deliver this Agreement and any other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform its obligations under this Agreement and any obligations it has under any Credit Support Document to which it is a party and has taken all necessary action to authorise such execution, delivery and performance;
(iii) NO VIOLATION OR CONFLICT. Such execution, delivery and performance do not violate or conflict with any law applicable to it, any provision of its constitutional documents, any order or judgment of any court or other agency of government applicable to it or any of its assets or any contractual restriction binding on or affecting it or any of its assets;
(iv) CONSENTS. All governmental and other consents that are required to have been obtained by it with respect to this Agreement or any Credit Support Document to which it is a party have been obtained and are in full force and effect and all conditions of any such consents have been complied with; and
(v) OBLIGATIONS BINDING. Its obligations under this Agreement and any Credit Support Document to which it is a party constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms (subject to applicable bankruptcy, reorganisation, insolvency, moratorium or similar laws affecting creditors' rights generally and subject, as to enforceability, to equitable principles of general application (regardless of whether enforcement is sought in a proceeding in equity or at law)).
3 ISDA (R) 1992
(b) ABSENCE OF CERTAIN EVENTS. No Event of Default or Potential Event of Default or, to its knowledge, Termination Event with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement or any Credit Support Document to which it is a party.
(c) ABSENCE OF LITIGATION. There is not pending or, to its knowledge, threatened against it or any of its Affiliates any action, suit or proceeding at law or in equity or before any court, tribunal, governmental body, agency or official or any arbitrator that is likely to affect the legality, validity or enforceability against it of this Agreement or any Credit Support Document to which it is a party or its ability to perform its obligations under this Agreement or such Credit Support Document.
(d) ACCURACY OF SPECIFIED INFORMATION. All applicable information that is furnished in writing by or on behalf of it to the other party and is identified for the purpose of this Section 3(d) in the Schedule is, as of the date of the information, true, accurate and complete in every material respect.
(e) PAYER TAX REPRESENTATION. Each representation specified in the Schedule as being made by it for the purpose of this Section 3(e) is accurate and true.
(f) PAYEE TAX REPRESENTATIONS. Each representation specified in the Schedule as being made by it for the purpose of this Section 3(f) is accurate and true.
4. AGREEMENTS
Each party agrees with the other that, so long as either party has or may have any obligation under this Agreement or under any Credit Support Document to which it is a party:--
(a) FURNISH SPECIFIED INFORMATION. It will deliver to the other party or, in certain cases under subparagraph (iii) below, to such government or taxing authority as the other party reasonably directs:--
(i) any forms, documents or certificates relating to taxation specified in the Schedule or any Confirmation;
(ii) any other documents specified in the Schedule or any Confirmation; and
(iii) upon reasonable demand by such other party, any form or document that may be required or reasonably requested in writing in order to allow such other party or its Credit Support Provider to make a payment under this Agreement or any applicable Credit Support Document without any deduction or withholding for or on account of any Tax or with such deduction or withholding at a reduced rate (so long as the completion, execution or submission of such form or document would not materially prejudice the legal or commercial position of the party in receipt of such demand), with any such form or document to be accurate and completed in a manner reasonably satisfactory to such other party and to be executed and to be delivered with any reasonably required certification,
in each case by the date specified in the Schedule or such Confirmation or, if none is specified, as soon as reasonably practicable.
(b) MAINTAIN AUTHORISATIONS. It will use all reasonable efforts to maintain in full force and effect all consents of any governmental or other authority that are required to be obtained by it with respect to this Agreement or any Credit Support Document to which it is a party and will use all reasonable efforts to obtain any that may become necessary in the future.
(c) COMPLY WITH LAWS. It will comply in all material respects with all applicable laws and orders to which it may be subject if failure so to comply would materially impair its ability to perform its obligations under this Agreement or any Credit Support Document to which it is a party.
(d) TAX AGREEMENT. It will give notice of any failure of a representation made by it under Section 3(f) to be accurate and true promptly upon learning of such failure.
(e) PAYMENT OF STAMP TAX. Subject to Section 11, it will pay any Stamp Tax levied or imposed upon it or in respect of its execution or performance of this Agreement by a jurisdiction in which it is incorporated,
4 ISDA (R) 1992
organised, managed and controlled, or considered to have its seat, or in which a branch or office through which it is acting for the purpose of this Agreement is located ("Stamp Tax Jurisdiction") and will indemnify the other party against any Stamp Tax levied or imposed upon the other party or in respect of the other party's execution or performance of this Agreement by any such Stamp Tax Jurisdiction which is not also a Stamp Tax Jurisdiction with respect to the other party.
5. EVENTS OF DEFAULT AND TERMINATION EVENTS
(a) EVENTS OF DEFAULT. The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any of the following events constitutes an event of default (an "Event of Default") with respect to such party:--
(i) FAILURE TO PAY OR DELIVER. Failure by the party to make, when due, any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) required to be made by it if such failure is not remedied on or before the third Local Business Day after notice of such failure is given to the party;
(ii) BREACH OF AGREEMENT. Failure by the party to comply with or perform
any agreement or obligation (other than an obligation to make any payment
under this Agreement or delivery under Section 2(a)(i) or 2(e) or to give
notice of a Termination Event or any agreement or obligation under Section
4(a)(i), 4(a)(iii) or 4(d)) to be complied with or performed by the party
in accordance with this Agreement if such failure is not remedied on or
before the thirtieth day after notice of such failure is given to the
party;
(iii) CREDIT SUPPORT DEFAULT.
(1) Failure by the party or any Credit Support Provider of such party to comply with or perform any agreement or obligation to be complied with or performed by it in accordance with any Credit Support Document if such failure is continuing after any applicable grace period has elapsed;
(2) the expiration or termination of such Credit Support Document or the failing or ceasing of such Credit Support Document to be in full force and effect for the purpose of this Agreement (in either case other than in accordance with its terms) prior to the satisfaction of all obligations of such party under each Transaction to which such Credit Support Document relates without the written consent of the other party; or
(3) the party or such Credit Support Provider disaffirms, disclaims, repudiates or rejects, in whole or in part, or challenges the validity of, such Credit Support Document;
(iv) MISREPRESENTATION. A representation (other than a representation under Section 3(e) or (f)) made or repeated or deemed to have been made or repeated by the party or any Credit Support Provider of such party in this Agreement or any Credit Support Document proves to have been incorrect or misleading in any material respect when made or repeated or deemed to have been made or repeated;
(v) DEFAULT UNDER SPECIFIED TRANSACTION. The party, any Credit Support
Provider of such party or any applicable Specified Entity of such party
(1) defaults under a Specified Transaction and, after giving effect to any
applicable notice requirement or grace period, there occurs a liquidation
of, an acceleration of obligations under, or an early termination of, that
Specified Transaction, (2) defaults, after giving effect to any applicable
notice requirement or grace period, in making any payment or delivery due
on the last payment, delivery or exchange date of, or any payment on early
termination of, a Specified Transaction (or such default continues for at
least three Local Business Days if there is no applicable notice
requirement or grace period) or (3) disaffirms, disclaims, repudiates or
rejects, in whole or in part, a Specified Transaction (or such action is
taken by any person or entity appointed or empowered to operate it or act
on its behalf);
(vi) CROSS DEFAULT. If "Cross Default" is specified in the Schedule as applying to the party, the occurrence or existence of (1) a default, event of default or other similar condition or event (however
5 ISDA (R) 1992
described) in respect of such party, any Credit Support Provider of such party or any applicable Specified Entity of such party under one or more agreements or instruments relating to Specified Indebtedness of any of them (individually or collectively) in an aggregate amount of not less than the applicable Threshold Amount (as specified in the Schedule) which has resulted in such Specified Indebtedness becoming, or becoming capable at such time of being declared, due and payable under such agreements or instruments, before it would otherwise have been due and payable or (2) a default by such party, such Credit Support Provider or such Specified Entity (individually or collectively) in making one or more payments on the due date thereof in an aggregate amount of not less than the applicable Threshold Amount under such agreements or instruments (after giving effect to any applicable notice requirement or grace period);
(vii) BANKRUPTCY. The party, any Credit Support Provider of such party or any applicable Specified Entity of such party:--
(1) is dissolved (other than pursuant to a consolidation,
amalgamation or merger); (2) becomes insolvent or is unable to pay
its debts or fails or admits in writing its inability generally to
pay its debts as they become due; (3) makes a general assignment,
arrangement or composition with or for the benefit of its creditors;
(4) institutes or has instituted against it a proceeding seeking a
judgment of insolvency or bankruptcy or any other relief under any
bankruptcy or insolvency law or other similar law affecting
creditors' rights, or a petition is presented for its winding-up or
liquidation, and, in the case of any such proceeding or petition
instituted or presented against it, such proceeding or petition (A)
results in a judgment of insolvency or bankruptcy or the entry of an
order for relief or the making of an order for its winding-up or
liquidation or (B) is not dismissed, discharged, stayed or
restrained in each case within 30 days of the institution or
presentation thereof; (5) has a resolution passed for its
winding-up, official management or liquidation (other than pursuant
to a consolidation, amalgamation or merger); (6) seeks or becomes
subject to the appointment of an administrator, provisional
liquidator, conservator, receiver, trustee, custodian or other
similar official for it or for all or substantially all its assets;
(7) has a secured party take possession of all or substantially all
its assets or has a distress, execution, attachment, sequestration
or other legal process levied, enforced or sued on or against all or
substantially all its assets and such secured party maintains
possession, or any such process is not dismissed, discharged, stayed
or restrained, in each case within 30 days thereafter; (8) causes or
is subject to any event with respect to it which, under the
applicable laws of any jurisdiction, has an analogous effect to any
of the events specified in clauses (1) to (7) (inclusive); or (9)
takes any action in furtherance of, or indicating its consent to,
approval of, or acquiescence in, any of the foregoing acts; or
(viii) MERGER WITHOUT ASSUMPTION. The party or any Credit Support Provider of such party consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and, at the time of such consolidation, amalgamation, merger or transfer:--
(1) the resulting, surviving or transferee entity fails to assume all the obligations of such party or such Credit Support Provider under this Agreement or any Credit Support Document to which it or its predecessor was a party by operation of law or pursuant to an agreement reasonably satisfactory to the other party to this Agreement; or
(2) the benefits of any Credit Support Document fail to extend (without the consent of the other party) to the performance by such resulting, surviving or transferee entity of its obligations under this Agreement.
(b) TERMINATION EVENTS. The occurrence at any time with respect to a party or, if applicable, any Credit Support Provider of such party or any Specified Entity of such party of any event specified below constitutes an Illegality if the event is specified in (i) below, a Tax Event if the event is specified in (ii) below or a Tax Event upon Merger if the event is specified in (iii) below, and, if specified to be applicable, a Credit Event
6 ISDA (R) 1992
Upon Merger if the event is specified pursuant to (iv) below or an Additional Termination Event if the event is specified pursuant to (v) below:--
(i) ILLEGALITY. Due to the adoption of, or any change in, any applicable law after the date on which a Transaction is entered into, or due to the promulgation of, or any change in, the interpretation by any court, tribunal or regulatory authority with competent jurisdiction of any applicable law after such date, it becomes unlawful (other than as a result of a breach by the party of Section 4(b)) for such party (which will be the Affected Party):--
(1) to perform any absolute or contingent obligation to make a payment or delivery or to receive a payment or delivery in respect of such Transaction or to comply with any other material provision of this Agreement relating to such Transaction; or
(2) to perform, or for any Credit Support Provider of such party to perform, any contingent or other obligation which the party (or such Credit Support Provider) has under any Credit Support Document relating to such Transaction;
(ii) TAX EVENT. Due to (x) any action taken by a taxing authority, or
brought in a court of competent jurisdiction, on or after the date on
which a Transaction is entered into (regardless of whether such action is
taken or brought with respect to a party to this Agreement) or (y) a
Change in Tax Law, the party (which will be the Affected Party) will, or
there is a substantial likelihood that it will, on the next succeeding
Scheduled Payment Date (1) be required to pay to the other party an
additional amount in respect of an Indemnifiable Tax under Section
2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or
6(e)) or (2) receive a payment from which an amount is required to be
deducted or withheld for or on account of a Tax (except in respect of
interest under Section 2(e), 6(d)(ii) or 6(e)) and no additional amount is
required to be paid in respect of such Tax under Section 2(d)(i)(4) (other
than by reason of Section 2(d)(i)(4)(A) or (B));
(iii) TAX EVENT UPON MERGER. The party (the "Burdened Party") on the next
succeeding Scheduled Payment Date will either (1) be required to pay an
additional amount in respect of an Indemnifiable Tax under Section
2(d)(i)(4) (except in respect of interest under Section 2(e), 6(d)(ii) or
6(e)) or (2) receive a payment from which an amount has been deducted or
withheld for or on account of any Indemnifiable Tax in respect of which
the other party is not required to pay an additional amount (other than by
reason of Section 2(d)(i)(4)(A) or (B)), in either case as a result of a
party consolidating or amalgamating with, or merging with or into, or
transferring all or substantially all its assets to, another entity (which
will be the Affected Party) where such action does not constitute an event
described in Section 5(a)(viii);
(iv) CREDIT EVENT UPON MERGER. If "Credit Event Upon Merger" is specified in the Schedule as applying to the party, such party ("X"), any Credit Support Provider of X or any applicable Specified Entity of X consolidates or amalgamates with, or merges with or into, or transfers all or substantially all its assets to, another entity and such action does not constitute an event described in Section 5(a)(viii) but the creditworthiness of the resulting, surviving or transferee entity is materially weaker than that of X, such Credit Support Provider or such Specified Entity, as the case may be, immediately prior to such action (and, in such event, X or its successor or transferee, as appropriate, will be the Affected Party); or
(v) ADDITIONAL TERMINATION EVENT. If any "Additional Termination Event" is specified in the Schedule or any Confirmation as applying, the occurrence of such event (and, in such event, the Affected Party or Affected Parties shall be as specified for such Additional Termination Event in the Schedule or such Confirmation).
(c) EVENT OF DEFAULT AND ILLEGALITY. If an event or circumstance which would otherwise constitute or give rise to an Event of Default also constitutes an Illegality, it will be treated as an Illegality and will not constitute an Event of Default.
7 ISDA (R) 1992
6. EARLY TERMINATION
(a) RIGHT TO TERMINATE FOLLOWING EVENT OF DEFAULT. If at any time an Event of Default with respect to a party (the "Defaulting Party") has occurred and is then continuing, the other party (the "Non-defaulting Party") may, by not more than 20 days notice to the Defaulting Party specifying the relevant Event of Default, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all outstanding Transactions. If, however, "Automatic Early Termination" is specified in the Schedule as applying to a party, then an Early Termination Date in respect of all outstanding Transactions will occur immediately upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(l), (3), (5), (6) or, to the extent analogous thereto, (8), and as of the time immediately preceding the institution of the relevant proceeding or the presentation of the relevant petition upon the occurrence with respect to such party of an Event of Default specified in Section 5(a)(vii)(4) or, to the extent analogous thereto, (8).
(b) RIGHT TO TERMINATE FOLLOWING TERMINATION EVENT.
(i) NOTICE. If a Termination Event occurs, an Affected Party will, promptly upon becoming aware of it, notify the other party, specifying the nature of that Termination Event and each Affected Transaction and will also give such other information about that Termination Event as the other party may reasonably require.
(ii) TRANSFER TO AVOID TERMINATION EVENT. If either an Illegality under
Section 5(b)(i)(l) or a Tax Event occurs and there is only one Affected
Party, or if a Tax Event Upon Merger occurs and the Burdened Party is the
Affected Party, the Affected Party will, as a condition to its right to
designate an Early Termination Date under Section 6(b)(iv), use all
reasonable efforts (which will not require such party to incur a loss,
excluding immaterial, incidental expenses) to transfer within 20 days
after it gives notice under Section 6(b)(i) all its rights and obligations
under this Agreement in respect of the Affected Transactions to another of
its Offices or Affiliates so that such Termination Event ceases to exist.
If the Affected Party is not able to make such a transfer it will give notice to the other party to that effect within such 20 day period, whereupon the other party may effect such a transfer within 30 days after notice is given under Section 6(b)(i).
Any such transfer by a party under this Section 6(b)(ii) will be subject to and conditional upon the prior written consent of the other party, which consent will not be withheld if such other party's policies in effect at such time would permit it to enter into transactions with the transferee on the terms proposed.
(iii) TWO AFFECTED PARTIES. If an Illegality under Section 5(b)(i)(1) or a Tax Event occurs and there are two Affected Parties, each party will use all reasonable efforts to reach agreement within 30 days after notice thereof is given under Section 6(b)(i) on action to avoid that Termination Event.
(iv) RIGHT TO TERMINATE. If:--
(1) a transfer under Section 6(b)(ii) or an agreement under Section
6(b)(iii), as the case may be, has not been effected with respect to
all Affected Transactions within 30 days after an Affected Party
gives notice under Section 6(b)(i); or
(2) an Illegality under Section 5(b)(i)(2), a Credit Event Upon Merger or an Additional Termination Event occurs, or a Tax Event Upon Merger occurs and the Burdened Party is not the Affected Party,
either party in the case of an Illegality, the Burdened Party in the case of a Tax Event Upon Merger, any Affected Party in the case of a Tax Event or an Additional Termination Event if there is more than one Affected Party, or the party which is not the Affected Party in the case of a Credit Event Upon Merger or an Additional Termination Event if there is only one Affected Party may, by not more than 20 days notice to the other party and provided that the relevant Termination Event is then
8 ISDA (R) 1992
continuing, designate a day not earlier than the day such notice is effective as an Early Termination Date in respect of all Affected Transactions.
(c) EFFECT OF DESIGNATION.
(i) If notice designating an Early Termination Date is given under Section 6(a) or (b), the Early Termination Date will occur on the date so designated, whether or not the relevant Event of Default or Termination Event is then continuing.
(ii) Upon the occurrence or effective designation of an Early Termination Date, no further payments or deliveries under Section 2(a)(i) or 2(e) in respect of the Terminated Transactions will be required to be made, but without prejudice to the other provisions of this Agreement. The amount if any, payable in respect of an Early Termination Date shall be determined pursuant to Section 6(e).
(d) CALCULATIONS.
(i) STATEMENT. On or as soon as reasonably practicable following the occurrence of an Early Termination Date, each party will make the calculations on its part, if any, contemplated by Section 6(e) and will provide to the other party a statement (1) showing, in reasonable detail, such calculations (including all relevant quotations and specifying any amount payable under Section 6(e)) and (2) giving details of the relevant account to which any amount payable to it is to be paid. In the absence of written confirmation from the source of a quotation obtained in determining a Market Quotation, the records of the party obtaining such quotation will be conclusive evidence of the existence and accuracy of such quotation.
(ii) PAYMENT DATE. An amount calculated as being due in respect of any Early Termination Date under Section 6(e) will be payable on the day that notice of the amount payable is effective (in the case of an Early Termination Date which is designated or occurs as a result of an Event of Default) and on the day which is two Local Business Days after the day on which notice of the amount payable is effective (in the case of an Early Termination Date which is designated as a result of a Termination Event). Such amount will be paid together with (to the extent permitted under applicable law) interest thereon (before as well as after judgment) in the Termination Currency, from (and including) the relevant Early Termination Date to (but excluding) the date such amount is paid, at the Applicable Rate. Such interest will be calculated on the basis of daily compounding and the actual number of days elapsed.
(e) PAYMENTS ON EARLY TERMINATION. If an Early Termination Date occurs. the following provisions shall apply based on the parties' election in the Schedule of a payment measure, either "Market Quotation" or "Loss", and a payment method, either the "First Method" or the "Second Method". If the parties fail to designate a payment measure or payment method in the Schedule, it will be deemed that "Market Quotation" or the "Second Method", as the case may be, shall apply. The amount, if any, payable in respect of an Early Termination Date and determined pursuant to this Section will be subject to any Set-off.
(i) EVENTS OF DEFAULT. If the Early Termination Date results from an Event of Default:--
(1) FIRST METHOD AND MARKET QUOTATION. If the First Method and Market Quotation apply, the Defaulting Party will pay to the Non-defaulting Party the excess, if a positive number, of (A) the sum of the Settlement Amount (determined by the Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the Non-defaulting Party over (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party.
(2) FIRST METHOD AND LOSS. If the First Method and Loss apply, the Defaulting Party will pay to the Non-defaulting Party, if a positive number, the Non-defaulting Party's Loss in respect of this Agreement.
(3) SECOND METHOD AND MARKET QUOTATION. If the Second Method and Market Quotation apply, an amount will be payable equal to (A) the sum of the Settlement Amount (determined by the
9 ISDA (R) 1992
Non-defaulting Party) in respect of the Terminated Transactions and the Termination Currency Equivalent of the Unpaid Amounts owing to the Non-defaulting Party less (B) the Termination Currency Equivalent of the Unpaid Amounts owing to the Defaulting Party. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party.
(4) SECOND METHOD AND LOSS. If the Second Method and Loss apply, an amount will be payable equal to the Non-defaulting Party's Loss in respect of this Agreement. If that amount is a positive number, the Defaulting Party will pay it to the Non-defaulting Party; if it is a negative number, the Non-defaulting Party will pay the absolute value of that amount to the Defaulting Party.
(ii) TERMINATION EVENTS. If the Early Termination Date results from a Termination Event:--
(1) ONE AFFECTED PARTY. If there is one Affected Party, the amount payable will be determined in accordance with Section 6(e)(i)(3), if Market Quotation applies, or Section 6(e)(i)(4), if Loss applies, except that, in either case, references to the Defaulting Party and to the Non-defaulting Party will be deemed to be references to the Affected Party and the party which is not the Affected Party, respectively, and, if Loss applies and fewer than all the Transactions are being terminated, Loss shall be calculated in respect of all Terminated Transactions.
(2) TWO AFFECTED PARTIES. If there are two Affected Parties:--
(A) if Market Quotation applies, each party will determine a Settlement Amount in respect of the Terminated Transactions, and an amount will be payable equal to (I) the sum of (a) one-half of the difference between the Settlement Amount of the party with the higher Settlement Amount ("X") and the Settlement Amount of the party with the lower Settlement Amount ("Y") and (b) the Termination Currency Equivalent of the Unpaid Amounts owing to X less (II) the Termination Currency Equivalent of the Unpaid Amounts owing to Y; and
(B) if Loss applies, each party will determine its Loss in respect of this Agreement (or, if fewer than all the Transactions are being terminated, in respect of all Terminated Transactions) and an amount will be payable equal to one-half of the difference between the Loss of the party with the higher Loss ("X") and the Loss of the party with the lower Loss ("Y").
If the amount payable is a positive number, Y will pay it to X; if it is a negative number, X will pay the absolute value of that amount to Y.
(iii) ADJUSTMENT FOR BANKRUPTCY. In circumstances where an Early Termination Date occurs because "Automatic Early Termination" applies in respect of a party, the amount determined under this Section 6(e) will be subject to such adjustments as are appropriate and permitted by law to reflect any payments or deliveries made by one party to the other under this Agreement (and retained by such other party) during the period from the relevant Early Termination Date to the date for payment determined under Section 6(d)(ii).
(iv) PRE-ESTIMATE. The parties agree that if Market Quotation applies an amount recoverable under this Section 6(e) is a reasonable pre-estimate of loss and not a penalty. Such amount is payable for the loss of bargain and the loss of protection against future risks and except as otherwise provided in this Agreement neither party will be entitled to recover any additional damages as a consequence of such losses.
10 ISDA (R) 1992
7. TRANSFER
Subject to Section 6(b)(ii), neither this Agreement nor any interest or obligation in or under this Agreement may be transferred (whether by way of security or otherwise) by either party without the prior written consent of the other party, except that:--
(a) a party may make such a transfer of this Agreement pursuant to a consolidation or amalgamation with, or merger with or into, or transfer of all or substantially all its assets to, another entity (but without prejudice to any other right or remedy under this Agreement); and
(b) a party may make such a transfer of all or any part of its interest in any amount payable to it from a Defaulting Party under Section 6(e).
Any purported transfer that is not in compliance with this Section will be void.
8. CONTRACTUAL CURRENCY
(a) PAYMENT IN THE CONTRACTUAL CURRENCY. Each payment under this Agreement will be made in the relevant currency specified in this Agreement for that payment (the "Contractual Currency"). To the extent permitted by applicable law, any obligation to make payments under this Agreement in the Contractual Currency will not be discharged or satisfied by any tender in any currency other than the Contractual Currency, except to the extent such tender results in the actual receipt by the party to which payment is owed, acting in a reasonable manner and in good faith in converting the currency so tendered into this Contractual Currency, of the full amount in the Contractual Currency of all amounts payable in respect of this Agreement. If for any reason the amount in the Contractual Currency so received falls short of the amount in the Contractual Currency payable in respect of this Agreement, the party required to make the payment will, to the extent permitted by applicable law, immediately pay such additional amount in the Contractual Currency as may be necessary to compensate for the shortfall. If for any reason the amount in the Contractual Currency so received exceeds the amount in the Contractual Currency payable in respect of this Agreement, the party receiving the payment will refund promptly the amount of such excess.
(b) JUDGMENTS. To the extent permitted by applicable law, if any judgment or
order expressed in a currency other than the Contractual Currency is rendered
(i) for the payment of any amount owing in respect of this Agreement, (ii) for
the payment of any amount relating to any early termination in respect of this
Agreement or (iii) in respect of a judgment or order of another court for the
payment of any amount described in (i) or (ii) above, the party seeking
recovery, after recovery in full of the aggregate amount to which such party is
entitled pursuant to the judgment or order, will be entitled to receive
immediately from the other party the amount of any shortfall of the Contractual
Currency received by such party as a consequence of sums paid in such other
currency and will refund promptly to the other party any excess of the
Contractual Currency received by such party as a consequence of sums paid in
such other currency if such shortfall or such excess arises or results from any
variation between the rate of exchange at which the Contractual Currency is
converted into the currency of the judgment or order for the purposes of such
judgment or order and the rate of exchange at which such party is able, acting
in a reasonable manner and in good faith in converting the currency received
into the Contractual Currency, to purchase the Contractual Currency with the
amount of the currency of the judgment or order actually received by such party.
The term "rate of exchange" includes, without limitation, any premiums and costs
of exchange payable in connection with the purchase of or conversion into the
Contractual Currency.
(c ) SEPARATE INDEMNITIES. To the extent permitted by applicable law, these indemnities constitute separate and independent obligations from the other obligations in this Agreement, will be enforceable as separate and independent causes of action, will apply notwithstanding any indulgence granted by the party to which any payment is owed and will not be affected by judgment being obtained or claim or proof being made for any other sums payable in respect of this Agreement.
(d) EVIDENCE OF LOSS. For the purpose of this Section 8, it will be sufficient for a party to demonstrate that it would have suffered a loss had an actual exchange or purchase been made.
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9. MISCELLANEOUS
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire agreement and understanding of the parties with respect to its subject matter and supersedes all oral communication and prior writings with respect thereto.
(b) AMENDMENTS. No amendment, modification or waiver in respect of this Agreement will be effective unless in writing (including a writing evidenced by a facsimile transmission) and executed by each of the parties or confirmed by an exchange of telexes or electronic messages on an electronic messaging system.
(c) SURVIVAL OF OBLIGATIONS. Without prejudice to Sections 2(a)(iii) and
6(c)(ii), the obligations of the parties under this Agreement will survive the
termination of any Transaction.
(d) REMEDIES CUMULATIVE. Except as provided in this Agreement, the rights, powers, remedies and privileges provided in this Agreement are cumulative and not exclusive of any rights, powers, remedies and privileges provided by law.
(e) COUNTERPARTS AND CONFIRMATIONS.
(i) This Agreement (and each amendment, modification and waiver in respect of it) may be executed and delivered in counterparts (including by facsimile transmission), each of which will be deemed an original.
(ii) The parties intend that they are legally bound by the terms of each Transaction from the moment they agree to those terms (whether orally or otherwise). A Confirmation shall be entered into as soon as practicable and may be executed and delivered in counterparts (including by facsimile transmission) or be created by an exchange of telexes or by an exchange of electronic messages on an electronic messaging system, which in each case will be sufficient for all purposes to evidence a binding supplement to this Agreement. The parties will specify therein or through another effective means that any such counterpart, telex or electronic message constitutes a Confirmation.
(f) NO WAIVER OF RIGHTS. A failure or delay in exercising any right, power or privilege in respect of this Agreement will not be presumed to operate as a waiver, and a single or partial exercise of any right, power or privilege will not be presumed to preclude any subsequent or further exercise, of that right, power or privilege or the exercise of any other right, power or privilege.
(g) HEADINGS. The headings used in this Agreement are for convenience of reference only and are not to affect the construction of or to be taken into consideration in interpreting this Agreement.
10. OFFICES; MULTIBRANCH PARTIES
(a) If Section 10(a) is specified in the Schedule as applying, each party that enters into a Transaction through an Office other than its head or home office represents to the other party that, notwithstanding the place of booking office or jurisdiction of incorporation or organisation of such party, the obligations of such party are the same as if it had entered into the Transaction through its head or home office. This representation will be deemed to be repeated by such party on each date on which a Transaction is entered into.
(b) Neither party may change the Office through which it makes and receives payments or deliveries for the purpose of a Transaction without the prior written consent of the other party.
(c) If a party is specified as a Multibranch Party in the Schedule, such Multibranch Party may make and receive payments or deliveries under any Transaction through any Office listed in the Schedule, and the Office through which it makes and receives payments or deliveries with respect to a Transaction will be specified in the relevant Confirmation.
11. EXPENSES
A Defaulting Party will, on demand, indemnify and hold harmless the other party for and against all reasonable out-of-pocket expenses, including legal fees and Stamp Tax, incurred by such other party by reason of the enforcement and protection of its rights under this Agreement or any Credit Support Document
12 ISDA (R) 1992
to which the Defaulting Party is a party or by reason of the early termination of any Transaction, including, but not limited to, costs of collection.
12. NOTICES
(a) EFFECTIVENESS. Any notice or other communication in respect of this Agreement may be given in any manner set forth below (except that a notice or other communication under Section 5 or 6 may not be given by facsimile transmission or electronic messaging system) to the address or number or in accordance with the electronic messaging system details provided (see the Schedule) and will be deemed effective as indicated:--
(i) if in writing and delivered in person or by courier, on the date it is delivered;
(ii) if sent by telex, on the date the recipient's answerback is received;
(iii) if sent by facsimile transmission, on the date that transmission is received by a responsible employee of the recipient in legible form (it being agreed that the burden of proving receipt will be on the sender and will not be met by a transmission report generated by the sender's facsimile machine);
(iv) if sent by certified or registered mail (airmail, if overseas) or the equivalent (return receipt requested), on the date that mail is delivered or its delivery is attempted; or
(v) if sent by electronic messaging system, on the date that electronic message is received,
unless the date of that delivery (or attempted delivery) or that receipt, as applicable, is not a Local Business Day or that communication is delivered (or attempted) or received, as applicable, after the close of business on a Local Business Day, in which case that communication shall be deemed given and effective on the first following day that is a Local Business Day.
(b) CHANGE OF ADDRESSES. Either party may by notice to the other change the address, telex or facsimile number or electronic messaging system details at which notices or other communications are to be given to it.
13. GOVERNING LAW AND JURISDICTION
(a) GOVERNING LAW. This Agreement will be governed by and construed in accordance with the law specified in the Schedule.
(b) JURISDICTION. With respect to any suit, action or proceedings relating to this Agreement ("Proceedings"), each party irrevocably:--
(i) submits to the jurisdiction of the English courts, if this Agreement is expressed to be governed by English law, or to the non-exclusive jurisdiction of the courts of the State of New York and the United States District Court located in the Borough of Manhattan in New York City, if this Agreement is expressed to be governed by the laws of the State of New York; and
(ii) waives any objection which it may have at any time to the laying of venue of any Proceedings brought in any such court, waives any claim that such Proceedings have been brought in an inconvenient forum and further waives the right to object, with respect to such Proceedings, that such court does not have any jurisdiction over such party.
Nothing in this Agreement precludes either party from bringing Proceedings in any other jurisdiction (outside, if this Agreement is expressed to be governed by English law, the Contracting States, as defined in Section 1(3) of the Civil Jurisdiction and Judgments Act 1982 or any modification, extension or re-enactment thereof for the time being in force) nor will the bringing of Proceedings in any one or more jurisdictions preclude the bringing of Proceedings in any other jurisdiction.
(c) SERVICE OF PROCESS. Each party irrevocably appoints the Process Agent (if any) specified opposite its name in the Schedule to receive, for it and on its behalf, service of process in any Proceedings. If for any
13 ISDA (R) 1992
reason any party's Process Agent is unable to act as such, such party will promptly notify the other party and within 30 days appoint a substitute process agent acceptable to the other party. The parties irrevocably consent to service of process given in the manner provided for notices in Section 12. Nothing in this Agreement will affect the right of either party to serve process in any other manner permitted by law.
(d) WAIVER OF IMMUNITIES. Each party irrevocably waives, to the fullest extent permitted by applicable law, with respect to itself and its revenues and assets (irrespective of their use or intended use), all immunity on the grounds of sovereignty or other similar grounds from (i) suit, (ii) jurisdiction of any court, (iii) relief by way of injunction, order for specific performance or for recovery of property, (iv) attachment of its assets (whether before or after judgment) and (v) execution or enforcement of any judgment to which it or its revenues or assets might otherwise be entitled in any Proceedings in the courts of any jurisdiction and irrevocably agrees, to the extent permitted by applicable law, that it will not claim any such immunity in any Proceedings.
14. DEFINITIONS
As used in this Agreement:--
"ADDITIONAL TERMINATION EVENT" has the meaning specified in Section 5(b).
"AFFECTED PARTY" has the meaning specified in Section 5(b).
"AFFECTED TRANSACTIONS" means (a) with respect to any Termination Event consisting of an Illegality, Tax Event or Tax Event Upon Merger, all Transactions affected by the occurrence of such Termination Event and (b) with respect to any other Termination Event, all Transactions.
"AFFILIATE" means, subject to the Schedule, in relation to any person, any entity controlled, directly or indirectly, by the person, any entity that controls, directly or indirectly, the person or any entity directly or indirectly under common control with the person. For this purpose, "control" of any entity or person means ownership of a majority of the voting power of the entity or person.
"APPLICABLE RATE" means:--
(a) in respect of obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Defaulting Party, the Default Rate;
(b) in respect of an obligation to pay an amount under Section 6(e) of either party from and after the date (determined in accordance with Section 6(d)(ii)) on which that amount is payable, the Default Rate;
(c) in respect of all other obligations payable or deliverable (or which would have been but for Section 2(a)(iii)) by a Non-defaulting Party, the Non-default Rate; and
(d) in all other cases, the Termination Rate.
"BURDENED PARTY" has the meaning specified in Section 5(b).
"CHANGE IN TAX LAW" means the enactment, promulgation, execution or ratification of, or any change in or amendment to, any law (or in the application or official interpretation of any law) that occurs on or after the date on which the relevant Transaction is entered into.
"CONSENT" includes a consent, approval, action, authorisation, exemption, notice, filing, registration or exchange control consent.
"CREDIT EVENT UPON MERGER" has the meaning specified in Section 5(b).
"CREDIT SUPPORT DOCUMENT" means any agreement or instrument that is specified as such in this Agreement.
"CREDIT SUPPORT PROVIDER" has the meaning specified in the Schedule.
"DEFAULT RATE" means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the relevant payee (as certified by it) if it were to fund or of funding the relevant amount plus 1% per annum.
14 ISDA (R) 1992
"DEFAULTING PARTY" has the meaning specified in Section 6(a).
"EARLY TERMINATION DATE" means the date determined in accordance with Section 6(a) or 6(b)(iv).
"EVENT OF DEFAULT" has the meaning specified in Section 5(a) and, if applicable, in the Schedule.
"ILLEGALITY" has the meaning specified in Section 5(b).
"INDEMNIFIABLE TAX" means any Tax other than a Tax that would not be imposed in respect of a payment under this Agreement but for a present or former connection between the jurisdiction of the government or taxation authority imposing such Tax and the recipient of such payment or a person related to such recipient (including, without limitation, a connection arising from such recipient or related person being or having been a citizen or resident of such jurisdiction, or being or having been organised, present or engaged in a trade or business in such jurisdiction, or having or having had a permanent establishment or fixed place of business in such jurisdiction, but excluding a connection arising solely from such recipient or related person having executed, delivered, performed its obligations or received a payment under, or enforced, this Agreement or a Credit Support Document).
"LAW" includes any treaty, law, rule or regulation (as modified, in the case of tax matters, by the practice of any relevant governmental revenue authority) and "LAWFUL" and "UNLAWFUL" will be construed accordingly.
"LOCAL BUSINESS DAY" means, subject to the Schedule, a day on which commercial
banks are open for business (including dealings in foreign exchange and foreign
currency deposits) (a) in relation to any obligation under Section 2(a)(i), in
the place(s) specified in the relevant Confirmation or, if not so specified, as
otherwise agreed by the parties in writing or determined pursuant to provisions
contained, or incorporated by reference, in this Agreement, (b) in relation to
any other payment, in the place where the relevant account is located and, if
different, in the principal financial centre, if any, of the currency of such
payment, (c) in relation to any notice or other communication, including notice
contemplated under Section 5(a)(i), in the city specified in the address for
notice provided by the recipient and, in the case of a notice contemplated by
Section 2(b), in the place where the relevant new account is to be located and
(d) in relation to Section 5(a)(v)(2), in the relevant locations for performance
with respect to such Specified Transaction.
"LOSS" means, with respect to this Agreement or one or more Terminated Transactions, as the case may be, and a party, the Termination Currency Equivalent of an amount that party reasonably determines in good faith to be its total losses and costs (or gain, in which case expressed as a negative number) in connection with this Agreement or that Terminated Transaction or group of Terminated Transactions, as the case may be, including any loss of bargain, cost of funding or, at the election of such party but without duplication, loss or cost incurred as a result of its terminating, liquidating, obtaining or reestablishing any hedge or related trading position (or any gain resulting from any of them). Loss includes losses and costs (or gains) in respect of any payment or delivery required to have been made (assuming satisfaction of each applicable condition precedent) on or before the relevant Early Termination Date and not made, except, so as to avoid duplication, if Section 6(e)(i)(1) or (3) or 6(e)(ii)(2)(A) applies. Loss does not include a party's legal fees and out-of-pocket expenses referred to under Section 11. A party will determine its Loss as of the relevant Early Termination Date, or, if that is not reasonably practicable, as of the earliest date thereafter as is reasonably practicable. A party may (but need not) determine its Loss by reference to quotations of relevant rates or prices from one or more leading dealers in the relevant markets.
"MARKET QUOTATION" means, with respect to one or more Terminated Transactions and a party making the determination, an amount determined on the basis of quotations from Reference Market-makers. Each quotation will be for an amount, if any, that would be paid to such party (expressed as a negative number) or by such party (expressed as a positive number) in consideration of an agreement between such party (taking into account any existing Credit Support Document with respect to the obligations of such party) and the quoting Reference Market-maker to enter into a transaction (the "Replacement Transaction") that would have the effect of preserving for such party the economic equivalent of any payment or delivery (whether the underlying obligation was absolute or contingent and assuming the satisfaction of each applicable condition precedent) by the parties under Section 2(a)(i) in respect of such Terminated Transaction or group of Terminated Transactions that would, but for the occurrence of the relevant Early Termination Date, have
15 ISDA (R) 1992
been required after that date. For this purpose, Unpaid Amounts in respect of the Terminated Transaction or group of Terminated Transactions are to be excluded but, without limitation, any payment or delivery that would, but for the relevant Early Termination Date, have been required (assuming satisfaction of each applicable condition precedent) after that Early Termination Date is to be included. The Replacement Transaction would be subject to such documentation as such party and the Reference Market-maker may, in good faith, agree. The party making the determination (or its agent) will request each Reference Market-maker to provide its quotation to the extent reasonably practicable as of the same day and time (without regard to different time zones) on or as soon as reasonably practicable after the relevant Early Termination Date. The day and time as of which those quotations are to be obtained will be selected in good faith by the party obliged to make a determination under Section 6(e), and, if each party is so obliged, after consultation with the other. If more than three quotations are provided, the Market Quotation will be the arithmetic mean of the quotations, without regard to the quotations having the highest and lowest values. If exactly three such quotations are provided, the Market Quotation will be the quotation remaining after disregarding the highest and lowest quotations. For this purpose, if more than one quotation has the same highest value or lowest value, then one of such quotations shall be disregarded. If fewer than three quotations are provided, it will be deemed that the Market Quotation in respect of such Terminated Transaction or group of Terminated Transactions cannot be determined.
"NON-DEFAULT RATE" means a rate per annum equal to the cost (without proof or evidence of any actual cost) to the Non-defaulting Party (as certified by it) if it were to fund the relevant amount.
"NON-DEFAULTING PARTY" has the meaning specified in Section 6(a).
"OFFICE" means a branch or office of a party, which may be such party's head or home office.
"POTENTIAL EVENT OF DEFAULT" means any event which, with the giving of notice or the lapse of time or both, would constitute an Event of Default.
"REFERENCE MARKET-MAKERS" means four leading dealers in the relevant market selected by the party determining a Market Quotation in good faith (a) from among dealers of the highest credit standing which satisfy all the criteria that such party applies generally at the time in deciding whether to offer or to make an extension of credit and (b) to the extent practicable, from among such dealers having an office in the same city.
"RELEVANT JURISDICTION" means, with respect to a party, the jurisdictions (a) in which the party is incorporated, organised, managed and controlled or considered to have its seat, (b) where an Office through which the party is acting for purposes of this Agreement is located, (c) in which the party executes this Agreement and (d) in relation to any payment, from or through which such payment is made.
"SCHEDULED PAYMENT DATE" means a date on which a payment or delivery is to be made under Section 2(a)(i) with respect to a Transaction.
"SET-OFF" means set-off, offset, combination of accounts, right of retention or withholding or similar right or requirement to which the payer of an amount under Section 6 is entitled or subject (whether arising under this Agreement, another contract, applicable law or otherwise) that is exercised by, or imposed on, such payer.
"SETTLEMENT AMOUNT" means, with respect to a party and any Early Termination Date, the sum of:--
(a) the Termination Currency Equivalent of the Market Quotations (whether positive or negative) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation is determined; and
(b) such party's Loss (whether positive or negative and without reference to any Unpaid Amounts) for each Terminated Transaction or group of Terminated Transactions for which a Market Quotation cannot be determined or would not (in the reasonable belief of the party making the determination) produce a commercially reasonable result.
"SPECIFIED ENTITY" has the meaning specified in the Schedule.
16 ISDA (R) 1992
"SPECIFIED INDEBTEDNESS" means, subject to the Schedule, any obligation (whether present or future, contingent or otherwise, as principal or surety or otherwise) in respect of borrowed money.
"SPECIFIED TRANSACTION" means, subject to the Schedule, (a) any transaction (including an agreement with respect thereto) now existing or hereafter entered into between one party to this Agreement (or any Credit Support Provider of such party or any applicable Specified Entity of such party) and the other party to this Agreement (or any Credit Support Provider of such other party or any applicable Specified Entity of such other party) which is a rate swap transaction, basis swap, forward rate transaction, commodity swap, commodity option, equity or equity index swap, equity or equity index option, bond option, interest rate option, foreign exchange transaction, cap transaction, floor transaction, collar transaction, currency swap transaction, cross-currency rate swap transaction, currency option or any other similar transaction (including any option with respect to any of these transactions), (b) any combination of these transactions and (c) any other transaction identified as a Specified Transaction in this Agreement or the relevant confirmation.
"STAMP TAX" means any stamp, registration, documentation or similar tax.
"TAX" means any present or future tax, levy, impost, duty, charge, assessment or fee of any nature (including interest, penalties and additions thereto) that is imposed by any government or other taxing authority in respect of any payment under this Agreement other than a stamp, registration, documentation or similar tax.
"TAX EVENT" has the meaning specified in Section 5(b).
"TAX EVENT UPON MERGER" has the meaning specified in Section 5(b).
"TERMINATED TRANSACTIONS" means with respect to any Early Termination Date (a) if resulting from a Termination Event, all Affected Transactions and (b) if resulting from an Event of Default, all Transactions (in either case) in effect immediately before the effectiveness of the notice designating that Early Termination Date (or, if "Automatic Early Termination" applies, immediately before that Early Termination Date).
"TERMINATION CURRENCY" has the meaning specified in the Schedule.
"TERMINATION CURRENCY EQUIVALENT" means, in respect of any amount denominated in the Termination Currency, such Termination Currency amount and, in respect of any amount denominated in a currency other than the Termination Currency (the "Other Currency"), the amount in the Termination Currency determined by the party making the relevant determination as being required to purchase such amount of such Other Currency as at the relevant Early Termination Date, or, if the relevant Market Quotation or Loss (as the case may be), is determined as of a later date, that later date, with the Termination Currency at the rate equal to the spot exchange rate of the foreign exchange agent (selected as provided below) for the purchase of such Other Currency with the Termination Currency at or about 11:00 a.m. (in the city in which such foreign exchange agent is located) on such date as would be customary for the determination of such a rate for the purchase of such Other Currency for value on the relevant Early Termination Date or that later date. The foreign exchange agent will, if only one party is obliged to make a determination under Section 6(e), be selected in good faith by that party and otherwise will be agreed by the parties.
"TERMINATION EVENT" means an Illegality, a Tax Event or a Tax Event Upon Merger or, if specified to be applicable, a Credit Event Upon Merger or an Additional Termination Event.
"TERMINATION RATE" means a rate per annum equal to the arithmetic mean of the cost (without proof or evidence of any actual cost) to each party (as certified by such party) if it were to fund or of funding such amounts.
"UNPAID AMOUNTS" owing to any party means, with respect to an Early Termination
Date, the aggregate of (a) in respect of all Terminated Transactions, the
amounts that became payable (or that would have become payable but for Section
2(a)(iii)) to such party under Section 2(a)(i) on or prior to such Early
Termination Date and which remain unpaid as at such Early Termination Date and
(b) in respect of each Terminated Transaction, for each obligation under Section
2(a)(i) which was (or would have been but for Section 2(a)(iii)) required to be
settled by delivery to such party on or prior to such Early Termination Date and
which has not been so settled as at such Early Termination Date, an amount equal
to the fair market
17 ISDA (R) 1992
value of that which was (or would have been) required to be delivered as of the originally scheduled date for delivery, in each case together with (to the extent permitted under applicable law) interest, in the currency of such amounts, from (and including) the date such amounts or obligations were or would have been required to have been paid or performed to (but excluding) such Early Termination Date, at the Applicable Rate. Such amounts of interest will be calculated on the basis of daily compounding and the actual number of days elapsed. The fair market value of any obligation referred to in clause (b) above shall be reasonably determined by the party obliged to make the determination under Section 6(e) or, if each party is so obliged, it shall be the average of the Termination Currency Equivalents of the fair market values reasonably determined by both parties.
IN WITNESS WHEREOF the parties have executed this document on the respective dates specified below with effect from the date specified on the first page of this document.
J.P. MORGAN SECURITIES, INC., AS WORLD FINANCIAL NETWORK CREDIT
AGENT FOR MORGAN GUARANTY TRUST CARD MASTER NOTE TRUST
COMPANY OF NEW YORK BY: CHASE MANHATTAN BANK USA,
NATIONAL ASSOCIATION, NOT IN ITS
INDIVIDUAL CAPACITY, BUT SOLELY
AS OWNER TRUSTEE
By: /s/ James Dwyer By: /s/ Denis Kelly
------------------------------- ------------------------------
Name: James Dwyer Name: Denis Kelly
Title: Vice President Title: Assistant Vice President
Date: 8/20/01 Date: 8/21/01
18 ISDA (R) 1992
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Exhibit 4.10
(MULTICURRENCY--CROSS BORDER)
ISDA(R)
International Swap Dealers Association, Inc.
SCHEDULE
TO THE
MASTER AGREEMENT
dated as of August 21, 2001
between MORGAN GUARANTY TRUST and WORLD FINANCIAL NETWORK
COMPANY OF NEW YORK CREDIT CARD MASTER NOTE
TRUST
("Party A") ("Party B")
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PART 1: TERMINATION PROVISIONS
(a) "INDENTURE" means the Master Indenture dated as of August 1, 2001, between World Financial Network Credit Card Master Note Trust, as Issuer, and BNY Midwest Trust Company, as Indenture Trustee, as supplemented by the Series 2001-A Indenture Supplement dated as of August 21, 2001, between World Financial Network Credit Card Master Note Trust, as the Issuer, and BNY Midwest Trust Company, as the Indenture Trustee, in each case, as amended, modified, supplemented, restated or replaced from time to time.
(b) "SPECIFIED ENTITY" means in relation to Party A for the purpose of:-
Section 5(a)(v) (Default under Specified Transaction), none;
Section 5(a)(vi) (Cross Default), none;
Section 5(a)(vii) (Bankruptcy), none; and
Section 5(b)(iv) (Credit Event Upon Merger), none;
in relation to Party B for the purpose of:-
Section 5(a)(v) (Default under Specified Transaction) none;
Section 5(a)(vi) (Cross Default), none;
Section 5(a)(vii) (Bankruptcy), none; and
Section 5(b)(iv) (Credit Event Upon Merger), none.
(c) "SPECIFIED TRANSACTION" will have the meaning specified in Section 14.
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
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(d) THE "BREACH OF AGREEMENT" provisions of Section 5(a)(ii), the "MISREPRESENTATION" provisions of Section 5(a)(iv), the "DEFAULT UNDER SPECIFIED TRANSACTIONS" provisions of Section 5(a)(v) and the "CROSS DEFAULT" provisions of Section 5(a)(vi) will not apply to Party A or Party B.
(e) The "ILLEGALITY" provision of Section 5(b)(i)
will not apply to Party A
will not apply to Party B.
(f) The "TAX EVENT" provision of Section 5(b)(ii)
will not apply to Party A
will not apply to Party B.
(g) The "TAX EVENT UPON MERGER" provision of Section 5(b)(iii)
will not apply to Party A
will not apply to Party B.
(h) The "CREDIT EVENT UPON MERGER" provisions of Section 5(b)(iv)
will not apply to Party A
will not apply to Party B.
(i) The "AUTOMATIC EARLY TERMINATION" provision of Section 6(a)
will not apply to Party A
will not apply to Party B.
(j) PAYMENTS ON EARLY TERMINATION. For the purpose of Section 6(e):
(i) Market Quotation will apply.
(ii) The First Method will apply.
(k) "TERMINATION CURRENCY" means United States Dollars.
(l) ADDITIONAL TERMINATION EVENT; REDEMPTION OF THE SECURED NOTES.
(i) Party B shall, as provided in the Indenture, direct the Indenture Trustee to notify Party A if notice is given pursuant to the Indenture of a redemption by Party B of all of the Notes (any such redemption by Party B of all of the Notes, a "Redemption Event").
(ii) If a Redemption Event occurs it shall be an Additional Termination Event for which Party B shall be the sole Affected Party and each Transaction shall be an Affected Transaction.
(iii) If a Redemption Event is to occur, the Early Termination Date in respect of each Affected Transaction shall be deemed to occur on the Distribution Date in respect of such Redemption Event. Any Settlement Amount payable in respect
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
2 SERIES 2001-A SWAP SCHEDULE
of such Redemption Event shall be paid, in the case of Party A and Party B, on the date of such Early Termination Date; provided that no such payments shall be made by Party B until the Note Principal Balance (as defined in the Indenture Supplement) has been reduced to zero.
(m) UNAUTHORIZED AMENDMENTS. Party B shall deliver to Party A a copy of any proposed Supplemental Indenture before such document takes effect.
(n) DOWNGRADE OF PARTY A. If a Ratings Event (as defined below) shall occur and be continuing with respect to Party A, then Party A shall, within 5 Local Business Days of such Ratings Event, (A) give notice to Party B of the occurrence of such Ratings Event, and (B) use reasonable efforts to transfer Party A's rights and obligations under the Agreement and all Confirmations to another party, subject to satisfaction of the Rating Agency Condition (as defined below), and at the cost of Party A. If such a transfer by Party A has not occurred within 20 Local Business Days after the occurrence of a Ratings Event, Party B shall demand that Party A deliver Eligible Collateral on a mark-to-market basis, to secure Party B's exposure, if any, to Party A, and such Eligible Collateral shall be delivered in accordance with a Credit Support Annex to be attached hereto and made a part hereof within 10 Local Business Days of Party B's demand therefor. The Eligible Collateral to be posted and the Credit Support Annex to be executed and delivered shall be subject to the Rating Agency Condition. Notwithstanding the addition of the Credit Support Annex and the posting of Eligible Collateral, Party A shall continue to use reasonable efforts to transfer its rights and obligations to an acceptable third party; provided, however, that Party A's obligations to find a transferee and to post Eligible Collateral under such Credit Support Annex shall remain in effect only for so long as a Ratings Event is continuing with respect to Party A. For the purpose of this Part 1(k), a "Ratings Event" shall occur with respect to Party A if the long-term and short-term senior unsecured deposit ratings of Party A cease to be at least A+ and A-1 by Standard & Poor's Ratings Service or any successor thereto ("S&P"), or at least A1 and P-1 by Moody's Investors Service, Inc. or any successor thereto ("Moody's"), or at least A+ and F1 by Fitch Ratings, Inc. or any successor thereto ("Fitch"), to the extent such obligations are rated by S&P, Moody's or Fitch. "Rating Agency Condition" has the meaning specified in the Indenture defined in Part 1(a) of this Schedule.
The failure by Party A to post Eligible Collateral in accordance herewith shall constitute an Event of Default with Party A as the Defaulting Party.
(o) Notwithstanding anything to the contrary in Section 6(e) of the Agreement, if an Early Termination Date is designated due to the occurrence of a Termination Event or an Additional Termination Event and the Settlement Amount calculated in respect thereof is a negative number, then the Settlement Amount shall be deemed to be zero.
PART 2: TAX REPRESENTATIONS
(a) PAYER TAX REPRESENTATIONS. For the purpose of Section 3(e) of this Agreement, Party A and Party B will make the following representation:-
It is not required by any applicable law, as modified by the practice of any relevant governmental revenue authority of any Relevant Jurisdiction to make any deduction or withholding for or on account of any Tax from any payment (other than interest under Section 2(e), 6(d)(ii) or 6(e) of this Agreement) to be made by it to the other party under this Agreement. In making this representation, it may rely on (x) the accuracy of any representations made by the other party
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
3 SERIES 2001-A SWAP SCHEDULE
pursuant to Section 3(f) of this Agreement, (y) the satisfaction of the agreement contained in Section 4(a)(i) or 4(a)(iii) of this Agreement and the accuracy and effectiveness of any document provided by the other party pursuant to Section 4(a)(i) or 4(a)(iii) of this Agreement and (z) the satisfaction of the agreement of the other party contained in Section 4(d) of this Agreement, PROVIDED that it shall not be a breach of this representation where reliance is placed on clause (y) and the other party does not deliver a form or document under Section 4(a)(iii) by reason of material prejudice to its legal or commercial position.
(b) PAYEE TAX REPRESENTATIONS. For the purpose of Section 3(f) of this Agreement, Party A and Party B will make the following representations specified below, if any: none
PART 3: AGREEMENT TO DELIVER DOCUMENTS
For the purpose of Section 4(a)(i) and (ii) of this Agreement, each party agrees to deliver the following documents:
(a) Tax forms, documents or certificates to be delivered are:
PARTY FORM/DOCUMENT/CERTIFICATE DATE BY WHICH TO BE DELIVERED
REQUIRED TO
DELIVER
DOCUMENT
--------------------------------------------------------------------------------
Party A and Any form, document or Upon request
Party B certificate as may be
requested pursuant to Section
4(a)(iii) of this Agreement.
Party B An executed United States (i) As soon as reasonably
Internal Revenue Service practicable after execution of this
Form W-9 (or any successor Agreement, (ii) promptly upon
thereto), as applicable. reasonable demand by Party A and
(iii) promptly upon learning that
any such form previously provided
by Party B has become obsolete or
incorrect.
(b) Other documents to be delivered are:-
PARTY FORM/DOCUMENT/CERTIFICATE DATE BY COVERED BY
REQUIRED TO WHICH TO BE SECTION 3(d)
DELIVER DELIVERED REPRESENTATION
DOCUMENT
--------------------------------------------------------------------------------
Party A and Certified copies of all corporate Upon execution Yes
Party B authorizations and any other and delivery of
documents with respect to the this Agreement
execution, delivery and
performance of this Agreement
and the Indenture.
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WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
4 SERIES 2001-A SWAP SCHEDULE
PARTY FORM/DOCUMENT/CERTIFICATE DATE BY COVERED BY
REQUIRED TO WHICH TO BE SECTION 3(d)
DELIVER DELIVERED REPRESENTATION
DOCUMENT
--------------------------------------------------------------------------------
Party A and Certificate of authority and Upon execution Yes
Party B specimen signatures of individuals and delivery of
executing this Agreement and any this Agreement
Confirmations. and thereafter
upon request of
the other party
Party B An opinion of counsel to Party B Upon execution Yes
on the enforceability of the and delivery of
Agreement and the Confirmation this Agreement
in respect of Party B, reasonably
satisfactory in form and substance
to Party A.
Party A An opinion of counsel to Party A Upon execution Yes
on the enforceability of the and delivery of
Agreement and the Confirmation this Agreement
in respect of Party A, reasonably
satisfactory in form and substance
to Party B.
Party A and Such other documents as the other Promptly upon Yes
Party B party may reasonably request in request
connection with each Transaction.
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PART 4: MISCELLANEOUS
(a) ADDRESS FOR NOTICES. For the purpose of Section 12(a) of this Agreement:-
Address for notice or communications to Party A:
Morgan Guaranty Trust Company of New York
60 Wall Street
New York, NY 10260
Attn.: Global Swap Unit
Telex No.: WVD 649216
Answerback: M6T VI
Facsimile No.: 212-648-5922
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
5 SERIES 2001-A SWAP SCHEDULE
Address for notice or communications to Party B:
World Financial Network Credit Card Master Note Trust
c/o JP Morgan Chase
500 Stanton Christiana Road
OPS4/ 3rd Floor
Newark, DE 19713
Attention: Institutional Trust Services
Telephone No.: 302-552-6287
Facsimile No.: 302-552-6280
With a copy to:
World Financial Network National Bank
800 Techcenter Drive
Gahanna, OH 43230
Attention: Treasurer
Telephone No.: 614-729-4723
Facsimile No.: 614-729-4899
(b) PROCESS AGENT. For the purpose of Section 13(c):
Party A appoints as its Process Agent: Not applicable.
Party B appoints as its Process Agent: Not applicable.
(c) OFFICES. The provisions of Section 10(a) will apply to this Agreement.
(d) MULTIBRANCH PARTY. For the purpose of Section 10 of this Agreement:-
Party A is a Multibranch Party and may act through any Office specified in the Confirmation for a Transaction.
Party B is not a Multibranch Party.
(e) CALCULATION AGENT. The Calculation Agent is Party A unless otherwise agreed to in writing by Party A or unless Party A is the sole Defaulting Party with respect to an Event of Default, in which case the Calculation Agent shall be appointed by the Indenture Trustee. If a party disagrees with a determination of market value made by the Calculation Agent, such party shall promptly provide to the Calculation Agent the basis for its disagreement. The original determination of market value made by the Calculation Agent shall remain valid unless the Calculation Agent, on the basis of the information provided by the disputing party, determines otherwise.
(f) CREDIT SUPPORT DOCUMENT. None.
(g) CREDIT SUPPORT PROVIDER.
Credit Support Provider means in relation to Party A: Not applicable.
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
6 SERIES 2001-A SWAP SCHEDULE
Credit Support Provider means in relation to Party B: Not applicable.
(h) GOVERNING LAW. This Agreement will be governed by and construed in accordance with the laws of the State of New York (without reference to its conflict of laws doctrine, other than Section 5-1401 of the General Obligations Law).
(i) NETTING OF PAYMENTS. All amounts payable on the same date, in the same currency and in respect of the same Transaction shall be netted in accordance with Section 2(c) of this Agreement. The election contained in the last paragraph of Section 2(c) of this Agreement shall not apply for the purposes of this Agreement.
(j) AMENDMENTS. Any amendments to the Agreement, Schedule and/or Confirmation shall be subject to the Rating Agency Condition.
(k) "AFFILIATE" will have the meaning specified in Section 14 of this Agreement.
PART 5: OTHER PROVISIONS
(a) ADDITIONAL AGREEMENTS. Party A agrees that it shall not enter a transaction of the type referred to in 5(a)(viii) (Merger Without Assumption) where the resulting, surviving or transferee entity fails to assume all of the obligations of Party A hereunder.
(b) DELIVERY OF CONFIRMATIONS. For each Transaction entered into hereunder,
Party A shall promptly send to Party B a Confirmation via facsimile
transmission. Party B agrees to respond to such Confirmation within two
(2) Local Business Days, either confirming agreement thereto or requesting
a correction of any error(s) contained therein. Failure by Party A to send
a Confirmation or of Party B to respond within such period shall not
affect the validity or enforceability of such Transaction. Absent manifest
error, there shall be a presumption that the terms contained in such
Confirmation are the terms of the Transaction.
(c) RECORDING OF CONVERSATIONS. Each party to this Agreement acknowledges and agrees to the tape recording of conversations between trading and marketing personnel of the parties to this Agreement whether by one or other or both of the parties or their agents, and that any such tape recordings may be submitted in evidence in any Proceedings relating to the Agreement.
(d) FURNISHING SPECIFIED INFORMATION. Section 4(a)(iii) is hereby amended by inserting "promptly upon the earlier of (i)" in lieu of the word "upon" at the beginning thereof and inserting "or (ii) such party learning that the form or document is required" before the word "any" on the first line thereof.
(e) NOTICE BY FACSIMILE TRANSMISSION. Section 12(a) is hereby amended by inserting the words "2(b)," between the word "Section" and the number "5" and inserting the words "or 13(c)" between the number "6" and the word "may" in the second line thereof.
(f) Section 3(a) of this Agreement is amended by (i) deleting the word "and"
at the end of clause (iv); (ii) deleting the period at the end of clause
(v) and inserting therein "; and " ; and (iii) by inserting the following
additional representation:
"(vi) ELIGIBLE CONTRACT PARTICIPANT. It is an `eligible contract
participant' as defined under the Commodity Exchange Act,
Section 1(a)(12)."
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
7 SERIES 2001-A SWAP SCHEDULE
(g) Section 3 is revised so as to add the following Section (g) at the end thereof:
"(g) RELATIONSHIP BETWEEN PARTIES. Each party represents to the other party and will be deemed to represent to the other party on the date on which it enters into a Transaction that (absent a written agreement between the parties that expressly imposes affirmative obligations to the contrary for that Transaction):-
(i) NON-RELIANCE. It is acting for its own account, and it has made its own independent decisions to enter into that Transaction and as to whether that Transaction is appropriate or proper for it based upon its own judgment and upon advice from such advisors as it has deemed necessary. It is not relying on any communication (written or oral) of the other party as investment advice or as a recommendation to enter into that Transaction; it being understood that information and explanations related to the terms and conditions of a Transaction shall not be considered investment advice or a recommendation to enter into that Transaction. Further, such party has not received from the other party any assurance or guarantee as to the expected results of that Transaction.
(ii) EVALUATION AND UNDERSTANDING. It is capable of evaluating and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of that Transaction. It is also capable of assuming, and assumes, the financial and other risks of that Transaction.
(iii) STATUS OF PARTIES. The other party is not acting as an agent, fiduciary or advisor for it in respect of that Transaction."
(h) WAIVER OF RIGHT TO TRIAL BY JURY. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHTS TO TRIAL BY JURY WITH RESPECT TO ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.
(i) NON-PETITION. Party A hereby agrees that it will not, prior to the date which is one year and one day after all Series 2001-A Notes issued by Party B pursuant to the Indenture have been paid in full, acquiesce, petition or otherwise invoke or cause Party B to invoke the process of any court or governmental authority for the purpose of commencing or sustaining a case against Party B under any federal or state bankruptcy, insolvency or similar law or for the purpose of appointing a receiver, liquidator, assignee, trustee, custodian, sequestrator or other similar official for Party B or any substantial part of the property of Party B, or for the purpose of ordering the winding up or liquidation of the affairs of Party B. Nothing herein shall prevent Party A from participating in any such proceeding once commenced.
(j) LIMITED RECOURSE. The obligations of Party B under this Agreement are limited recourse obligations of Party B, payable solely from the Trust Estate (as such term is defined in the Indenture), subject to and in accordance with the terms of the Indenture, and, following realization of the Trust Estate, any claims of Party A against Party B shall be extinguished. No recourse shall be had for the payment of any amount owing in respect of this Agreement against the trustee, or any officer, member, director, employee, security holder or incorporator thereof (each, an "Affiliated Person") of Party B or its successors or assigns for any amounts payable under this Agreement. It is understood that the foregoing provisions shall not (i) prevent
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
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recourse to the Trust Estate for the sums due or to become due under any
security, instrument or agreement which is part of the Trust Estate
(subject to the priority of payments set forth in the Indenture) or (ii)
constitute a waiver, release or discharge of any obligation of Party B
arising under this Agreement until the Trust Estate has been realized and
the proceeds applied in accordance with the Indenture, whereupon any
outstanding obligation of Party B under this Agreement shall be
extinguished.
(k) TRANSFER. Section 7 of the Agreement is supplemented by the additional requirement that any transfer or assignment by Party A of its obligations under the Agreement (including any Confirmation), and any amendments to the Agreement (including any Confirmation), shall be subject to the Rating Agency Condition. Party A consents to the pledge and assignment by Party B of its rights and obligations hereunder and under any Transaction to the Indenture Trustee pursuant to the Indenture.
(l) EVENTS OF DEFAULT. (i) Section 5(a)(i) of the Agreement is amended by substituting the following therefor: "Failure by the party to make, when due, any payment under this Agreement or delivery under Section 2(a)(i) or 2(e) required to be made by it within five days of the date due under this Agreement and, upon at least one Business Days' prior notice to the other party."
(m) RATING OF PARTY A. Party A represents to Party B that, on the date of this Agreement, (i) its long-term unsecured debt is rated at or above "A+" by S&P, "A1" by Moody's and "A+" by Fitch, and (ii) its short-term unsecured debt is rated at or above "A-1" by S&P, "P-1" by Moody's and "F1" by Fitch.
(n) OWNER TRUSTEE. It is expressly understood and agreed by the parties hereto that (a) this Agreement is executed and delivered by Chase Manhattan Bank USA, National Association, not individually or personally but solely as trustee of Party B in the exercise of the powers and authority conferred and vested in it under the Amended and Restated Trust Agreement (as defined in the Indenture), (b) each of the representations, undertakings and agreements herein made on the part of Party B are made and intended not as personal representations, undertakings and agreements by Chase Manhattan Bank USA, National Association, but are made and intended for the purpose of binding only Party B, and (c) under no circumstances shall Chase Manhattan Bank USA, National Association be personally liable for the payment of any indebtedness or expenses of Party B or be liable for the breach or failure of any obligation, representations, warranty or covenant made or undertaken by Party B under this Agreement.
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
9 SERIES 2001-A SWAP SCHEDULE
ACCEPTED AND AGREED:
MORGAN GUARANTY TRUST WORLD FINANCIAL NETWORK CREDIT
COMPANY OF NEW YORK CARD MASTER NOTE TRUST
By: Chase Manhattan Bank USA, National
Association, not in its individual
By: /s/ James Dwyer capacity, but solely as Owner Trustee
-------------------------------
Name: James Dwyer
Title: Vice President
By: /s/ Denis Kelly
----------------------------------
Name: Denis Kelly
Title: Assistant Vice President
By: ______________________________
Name:
|
Title:
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A SWAP SCHEDULE
Exhibit 4.11
CLASS A
CONFIRMATION FOR U.S. DOLLAR INTEREST RATE SWAP
TRANSACTION UNDER 2001 MASTER AGREEMENT
DATE: August 21, 2001 OUR REF: Morgan Reference Number 500344
TO: World Financial Network Credit Card FROM: Morgan Guaranty Trust Company of
Master Note Trust New York
c/o JP Morgan Chase 60 Wall Street
500 Stanton Christiana Road New York, NY 10260
OPS4/ 3rd Floor
Newark, DE 19713
ATTN: Institutional Trust Services CONTACT: Document Control
FAX NO: FAX NO: 212-648-8882
TEL NO: TEL NO: 212-648-5088
|
Dear Sir/Madam,
The purpose of this letter agreement is to confirm the terms and conditions of the Transaction entered into between WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST and MORGAN GUARANTY TRUST COMPANY OF NEW YORK (each a "party" and together "the parties") on the Trade Date specified below (the "Transaction"). This letter agreement constitutes a "Confirmation" as referred to in the ISDA Master Agreement specified in paragraph 1 below (the "Agreement").
The definitions and provisions contained in the 1991 ISDA Definitions, as amended by the 1998 Supplement thereto (each as published by the International Swaps and Derivatives Association, Inc., the "Definitions") are incorporated into this Confirmation. In the event of any inconsistency between the Definitions and this Confirmation, this Confirmation will govern. Capitalized terms used herein and not otherwise defined have the meanings set forth in the Definitions or the Indenture dated as of August 1, 2001, between Party B and BNY Midwest Trust Company, as indenture trustee (the "Indenture") as supplemented by the Series 2001-A Indenture Supplement, dated as of August 21, 2001 (the "Indenture Supplement" and together with the Indenture, the "Indenture").
1. This Confirmation supplements, forms part of, and is subject to, the ISDA Master Agreement (including the Schedule thereto) dated as of August 21, 2001, as amended and supplemented from time to time (the "Agreement"), between the parties. All provisions contained in the Agreement govern this Confirmation except as expressly modified below.
In this Confirmation "Party A" means Morgan Guaranty Trust Company of New York and "Party B" means World Financial Network Credit Card Master Note Trust.
2. The terms of the particular Transaction to which this Confirmation relates are as follows:
Notional Amount: Initially, USD 702,000,000 and thereafter an amount
equal for each Calculation Period to the Class A Note
Principal Balance (as defined in the Indenture
Supplement) at the end of the first day of that
Calculation Period.
Trade Date: August 2, 2001
Effective Date: August 21, 2001
|
Termination Date: The earlier of (i) June 16, 2008, subject to
adjustment in accordance with the Following
Business Day Convention, and (ii) the date on
which the Class A Note Principal Balance (as
defined in the Indenture Supplement) is
reduced to zero, subject to early termination
in accordance with the terms of the
Agreement. In accordance with the Indenture
Supplement, the Class A Expected Principal
Distribution Date is August 15, 2004, subject
to the Following Business Day Convention.
FIXED AMOUNTS:
Fixed Rate Payer: Party B
Fixed Rate Payer Payment The 15th of each month commencing October 15,
Dates: 2001 and ending on the Termination Date,
subject to adjustment in accordance with the
Following Business Day Convention
Fixed Rate: 4.87% per annum
Fixed Rate Day Count Actual/360
Fraction:
FLOATING AMOUNTS:
Floating Rate Payer: Party A
Floating Rate Payer Payment The 15th of each month commencing October 15,
Dates: 2001 and ending on the Termination Date,
subject to adjustment in accordance with the
Following Business Day Convention.
Floating Rate for initial
Calculation Period: 3.575%
Floating Rate Option: USD-LIBOR-BBA
Designated Maturity: 1 Month, including initial Calculation
Period.
Spread: None
Floating Rate Day Count Actual/360
Fraction:
Reset Dates: First day of each Calculation Period
Business Days: New York, Columbus, Ohio, and Chicago,
Illinois
Calculation Agent: Party A
|
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 50344
3. ADDITIONAL AMOUNTS UPON PARTIAL TERMINATION
On any Payment Date prior to the Class A Expected Principal Distribution Date (as defined in the Indenture Supplement), where as a result of principal payments on the Class A Notes (as defined in the Indenture Supplement), the Notional Amount would be reduced by the corresponding reduction in the Class A Note Principal Balance (as defined in the Indenture Supplement), the parties hereto shall treat the portion of such reduction (without duplication) as terminated on such Payment Date (a "Terminated Transaction"). Party A shall calculate the Market Quotation for the Terminated Transaction as set forth below.
"Market Quotation" means, with respect to a Terminated Transaction, an
amount determined on the basis of quotations from Reference Market-makers. Each
quotation will be for an amount, if any, that would be paid to Party A
(expressed as a negative number) or by Party A (expressed as a positive number)
in consideration of an agreement between Party A and the quoting Reference
Market-maker to enter into such Terminated Transaction (with the same fixed and
floating payment rates and remaining term as this Transaction) on the relevant
Payment Date. Party A will request each Reference Market-maker to provide its
quotation to the extent reasonably practicable as of the same day and time
(without regard to different time zones) on or as soon as reasonably practicable
prior to the relevant Payment Date. The day and time as of which those
quotations are to be obtained will be selected in good faith by Party A. If more
than three quotations are provided, the Market Quotation will be the arithmetic
mean of the quotations, without regard to the quotations having the highest and
lowest values. If exactly three such quotations are provided, the Market
Quotation will be the quotation remaining after disregarding the highest and
lowest quotations. For this purpose, if more than one quotation has the same
highest value or lowest value, then one of such quotations shall be disregarded.
If fewer than three quotations are provided, Party A will determine the Market
Quotation in good faith. Notwithstanding the foregoing, Party A shall be the
sole Reference Market-maker unless: (a) the reduction in the Notional Amount of
the Transaction is equal to or greater than $50 million on such Payment Date,
and (b) the Servicer or the Indenture Trustee requests that quotations from
Reference Market-makers other than Party A are utilized.
If the amount so determined by Party A in respect of a Terminated Transaction is positive, Party B shall owe such amount to Party A, which shall be payable (with interest thereon accruing from such Payment Date and calculated at the Fixed Rate) on the next Distribution Date to the extent provided in the Indenture. If such amount is negative, no amounts shall be payable by Party A or Party B in respect of the Terminated Transaction.
4. ACCOUNT DETAILS:
Account for payments to Party Name: Morgan Guaranty Trust Company of New A: York
City: New York
ABA# 021-000-238
Ref: World Financial Network Credit Card Master
Note Trust - Swaps Group
Acct: 67007054
Account for payments to Party Name: Bank of New York B:
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 50344
Collection Account
5. OFFICES:
The Office of Party A for this 270 Park Avenue, 8th Floor
Transaction is:
New York, NY 10017
The Office of Party B for this 500 Stanton Christiana Road
Transaction is:
OPS4/ 3rd Floor
|
Please confirm that the foregoing correctly sets forth the terms and conditions of our agreement by responding within three (3) Business Days by returning via telecopier an executed copy of this Confirmation to the attention of Marisol Collaza (fax no. 212-834-6580).
Failure to respond within such period shall not affect the validity or enforceability of this Transaction, and shall be deemed to be an affirmation of the terms and conditions contained herein, absent manifest error.
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 50344
J.P. MORGAN SECURITIES INC., AS ACCEPTED AND CONFIRMED AS OF THE DATE
AGENT FOR MORGAN GUARANTY TRUST FIRST WRITTEN:
COMPANY OF NEW YORK
WORLD FINANCIAL NETWORK CREDIT
CARD MASTER NOTE TRUST,
BY: CHASE MANHATTAN BANK USA, NATIONAL
By: /s/ Sheri McCall ASSOCIATION, NOT IN ITS INDIVIDUAL
------------------------------ CAPACITY, BUT SOLELY AS OWNER TRUSTEE
Name: Sheri McCall
Title: Assistant Vice President
By: ______________________________ By: /s/ Denis Kelly
Name: ------------------------------------
Name and Title: Denis Kelly
Assistant Vice President
|
Title:
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 50344
Exhibit 4.12
CLASS B
CONFIRMATION FOR U.S. DOLLAR INTEREST RATE SWAP
TRANSACTION UNDER 2001 MASTER AGREEMENT
DATE: August 21, 2001 OUR REF: Morgan Reference Number 500343
TO: World Financial Network Credit Card FROM: Morgan Guaranty Trust Company of
Master Note Trust New York
c/o JP Morgan Chase 60 Wall Street
500 Stanton Christiana Road New York, NY 10260
OPS4/ 3rd Floor
Newark, DE 19713
ATTN: Institutional Trust Services CONTACT: Document Control
FAX NO: FAX NO: 212-648-8882
TEL NO: TEL NO: 212-648-5088
|
Dear Sir/Madam,
The purpose of this letter agreement is to confirm the terms and conditions of the Transaction entered into between WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST and MORGAN GUARANTY TRUST COMPANY OF NEW YORK (each a "party" and together "the parties") on the Trade Date specified below (the "Transaction"). This letter agreement constitutes a "Confirmation" as referred to in the ISDA Master Agreement specified in paragraph 1 below (the "Agreement").
The definitions and provisions contained in the 1991 ISDA Definitions, as amended by the 1998 Supplement thereto (each as published by the International Swaps and Derivatives Association, Inc., the "Definitions") are incorporated into this Confirmation. In the event of any inconsistency between the Definitions and this Confirmation, this Confirmation will govern. Capitalized terms used herein and not otherwise defined have the meanings set forth in the Definitions or the Indenture dated as of August 1, 2001, between Party B and BNY Midwest Trust Company, as indenture trustee (the "Indenture") as supplemented by the Series 2001-A Indenture Supplement, dated as of August 21, 2001 (the "Indenture Supplement" and together with the Indenture, the "Indenture").
1. This Confirmation supplements, forms part of, and is subject to, the ISDA Master Agreement (including the Schedule thereto) dated as of August 21, 2001, as amended and supplemented from time to time (the "Agreement"), between the parties. All provisions contained in the Agreement govern this Confirmation except as expressly modified below.
In this Confirmation "Party A" means Morgan Guaranty Trust Company of New York and "Party B" means World Financial Network Credit Card Master Note Trust.
2. The terms of the particular Transaction to which this Confirmation relates are as follows:
Notional Amount: Initially, USD 76,500,000 and thereafter an
amount equal for each Calculation Period to
the Class B Note Principal Balance (as
defined in the Indenture Supplement) at the
end of the first day of that Calculation
Period.
Trade Date: August 2, 2001
Effective Date: August 21, 2001
|
Termination Date: The earlier of (i) June 16, 2008, subject to
adjustment in accordance with the Following
Business Day Convention, and (ii) the date on
which the Class B Note Principal Balance (as
defined in the Indenture Supplement) is
reduced to zero, subject to early termination
in accordance with the terms of the
Agreement. In accordance with the Indenture
Supplement, the Class B Expected Principal
Distribution Date is August 15, 2004, subject
to the Following Business Day Convention.
FIXED AMOUNTS:
Fixed Rate Payer: Party B
Fixed Rate Payer Payment The 15th of each month commencing October 15,
Dates: 2001 and ending on the Termination Date,
subject to adjustment in accordance with the
Following Business Day Convention
Fixed Rate: 4.87% per annum
Fixed Rate Day Count Actual/360
Fraction:
FLOATING AMOUNTS:
Floating Rate Payer: Party A
Floating Rate Payer The 15th of each month commencing October 15,
Payment Dates: 2001 and ending on the Termination Date,
subject to adjustment in accordance with the
Following Business Day Convention.
Floating Rate for initial
Calculation Period: 3.575%
Floating Rate Option: USD-LIBOR-BBA
Designated Maturity: 1 Month, including initial Calculation
Period.
Spread: None
Floating Rate Day Count Actual/360
Fraction:
Reset Dates: First day of each Calculation Period
Business Days: New York, Columbus, Ohio, and Chicago,
Illinois
Calculation Agent: Party A
|
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 500343
3. ADDITIONAL AMOUNTS UPON PARTIAL TERMINATION
On any Payment Date prior to the Class B Expected Principal Distribution Date (as defined in the Indenture Supplement), where as a result of principal payments on the Class B Notes (as defined in the Indenture Supplement), the Notional Amount would be reduced by the corresponding reduction in the Class B Note Principal Balance (as defined in the Indenture Supplement), the parties hereto shall treat the portion of such reduction (without duplication) as terminated on such Payment Date (a "Terminated Transaction"). Party A shall calculate the Market Quotation for the Terminated Transaction as set forth below.
"Market Quotation" means, with respect to a Terminated Transaction, an
amount determined on the basis of quotations from Reference Market-makers. Each
quotation will be for an amount, if any, that would be paid to Party A
(expressed as a negative number) or by Party A (expressed as a positive number)
in consideration of an agreement between Party A and the quoting Reference
Market-maker to enter into such Terminated Transaction (with the same fixed and
floating payment rates and remaining term as this Transaction) on the relevant
Payment Date. Party A will request each Reference Market-maker to provide its
quotation to the extent reasonably practicable as of the same day and time
(without regard to different time zones) on or as soon as reasonably practicable
prior to the relevant Payment Date. The day and time as of which those
quotations are to be obtained will be selected in good faith by Party A. If more
than three quotations are provided, the Market Quotation will be the arithmetic
mean of the quotations, without regard to the quotations having the highest and
lowest values. If exactly three such quotations are provided, the Market
Quotation will be the quotation remaining after disregarding the highest and
lowest quotations. For this purpose, if more than one quotation has the same
highest value or lowest value, then one of such quotations shall be disregarded.
If fewer than three quotations are provided, Party A will determine the Market
Quotation in good faith. Notwithstanding the foregoing, Party A shall be the
sole Reference Market-maker unless: (a) the reduction in the Notional Amount of
the Transaction is equal to or greater than $50 million on such Payment Date,
and (b) the Servicer or the Indenture Trustee requests that quotations from
Reference Market-makers other than Party A are utilized.
If the amount so determined by Party A in respect of a Terminated Transaction is positive, Party B shall owe such amount to Party A, which shall be payable (with interest thereon accruing from such Payment Date and calculated at the Fixed Rate) on the next Distribution Date to the extent provided in the Indenture. If such amount is negative, no amounts shall be payable by Party A or Party B in respect of the Terminated Transaction.
4. ACCOUNT DETAILS:
Account for payments to Party Name: Morgan Guaranty Trust Company of New A: York
City: New York
ABA# 021-000-238
Ref: World Financial Network Credit Card Master
Note Trust - Swaps Group
Acct: 67007054
Account for payments to Party Bank of New York
B: ABA #021-000-018
Name: World Financial Network Credit Card Master
Note Trust
|
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 500343
Collection Account Acct: 048171
5. OFFICES:
The Office of Party A for this 270 Park Avenue, 8th Floor
Transaction is:
New York, NY 10017
The Office of Party B for this 500 Stanton Christiana Road
Transaction is:
OPS4/ 3rd Floor
|
Please confirm that the foregoing correctly sets forth the terms and conditions of our agreement by responding within three (3) Business Days by returning via telecopier an executed copy of this Confirmation to the attention of Document Control (fax no. 212-648-8882).
Failure to respond within such period shall not affect the validity or enforceability of this Transaction, and shall be deemed to be an affirmation of the terms and conditions contained herein, absent manifest error.
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 500343
J.P. MORGAN SECURITIES INC., AS ACCEPTED AND CONFIRMED AS OF THE DATE
AGENT FOR MORGAN GUARANTY TRUST FIRST WRITTEN:
COMPANY OF NEW YORK
WORLD FINANCIAL NETWORK CREDIT
CARD MASTER NOTE TRUST,
BY: CHASE MANHATTAN BANK USA, NATIONAL
By: /s/ Sheri McCall ASSOCIATION, NOT IN ITS INDIVIDUAL
------------------------------ CAPACITY, BUT SOLELY AS OWNER TRUSTEE
Name: Sheri McCall
Title: Assistant Vice President
By: _____________________________ By: /s/ Denis Kelly
Name: -----------------------------------
Name and Title: Denis Kelly
Assistant Vice President
|
Title:
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 500343
Exhibit 4.13
CLASS C
CONFIRMATION FOR U.S. DOLLAR INTEREST RATE SWAP
TRANSACTION UNDER 2001 MASTER AGREEMENT
DATE: August 21, 2001 OUR REF: Morgan Reference Number 500342
TO: World Financial Network Credit Card FROM: Morgan Guaranty Trust Company of
Master Note Trust New York
c/o JP Morgan Chase 60 Wall Street
500 Stanton Christiana Road New York, NY 10260
OPS4/ 3rd Floor
Newark, DE 19713
ATTN: Institutional Trust Services CONTACT: Document Control
FAX NO: FAX NO: 212-648-8882
TEL NO: TEL NO: 212-648-5088
|
Dear Sir/Madam,
The purpose of this letter agreement is to confirm the terms and conditions of the Transaction entered into between WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST and MORGAN GUARANTY TRUST COMPANY OF NEW YORK (each a "party" and together "the parties") on the Trade Date specified below (the "Transaction"). This letter agreement constitutes a "Confirmation" as referred to in the ISDA Master Agreement specified in paragraph 1 below (the "Agreement").
The definitions and provisions contained in the 1991 ISDA Definitions, as amended by the 1998 Supplement thereto (each as published by the International Swaps and Derivatives Association, Inc., the "Definitions") are incorporated into this Confirmation. In the event of any inconsistency between the Definitions and this Confirmation, this Confirmation will govern. Capitalized terms used herein and not otherwise defined have the meanings set forth in the Definitions or the Indenture dated as of August 1, 2001, between Party B and BNY Midwest Trust Company, as indenture trustee (the "Indenture") as supplemented by the Series 2001-A Indenture Supplement, dated as of August 21, 2001 (the "Indenture Supplement" and together with the Indenture, the "Indenture").
1. This Confirmation supplements, forms part of, and is subject to, the ISDA Master Agreement (including the Schedule thereto) dated as of August 21, 2001, as amended and supplemented from time to time (the "Agreement"), between the parties. All provisions contained in the Agreement govern this Confirmation except as expressly modified below.
In this Confirmation "Party A" means Morgan Guaranty Trust Company of New York and "Party B" means World Financial Network Credit Card Master Note Trust.
2. The terms of the particular Transaction to which this Confirmation relates are as follows:
Notional Amount: Initially, USD 121,500,000 and thereafter an
amount equal for each Calculation Period to
the Class C Note Principal Balance (as
defined in the Indenture Supplement) at the
end of the first day of that Calculation
Period.
Trade Date: August 2, 2001
Effective Date: August 21, 2001
|
Termination Date: The earlier of (i) June 16, 2008, subject to
adjustment in accordance with the Following
Business Day Convention, and (ii) the date on
which the Class C Note Principal Balance (as
defined in the Indenture Supplement) is
reduced to zero, subject to early termination
in accordance with the terms of the
Agreement. In accordance with the Indenture
Supplement, the Class C Expected Principal
Distribution Date is September 15, 2004,
subject to the Following Business Day
Convention.
FIXED AMOUNTS:
Fixed Rate Payer: Party B
Fixed Rate Payer Payment The 15th of each month commencing October 15,
Dates: 2001 and ending on the Termination Date,
subject to adjustment in accordance with the
Following Business Day Convention
Fixed Rate: 4.92% per annum
Fixed Rate Day Count Actual/360
Fraction:
FLOATING AMOUNTS:
Floating Rate Payer: Party A
Floating Rate Payer The 15th of each month commencing October 15,
Payment Dates: 2001 and ending on the Termination Date,
subject to adjustment in accordance with the
Following Business Day Convention.
Floating Rate for initial
Calculation Period: 3.575%
Floating Rate Option: USD-LIBOR-BBA
Designated Maturity: 1 Month, including initial Calculation
Period.
Spread: None
Floating Rate Day Count Actual/360
Fraction:
Reset Dates: First day of each Calculation Period
Business Days: New York, Columbus, Ohio, and Chicago,
Illinois
Calculation Agent: Party A
|
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 500342
3. ADDITIONAL AMOUNTS UPON PARTIAL TERMINATION
On any Payment Date prior to the Class C Expected Principal Distribution Date (as defined in the Indenture Supplement), where as a result of principal payments on the Class C Notes (as defined in the Indenture Supplement), the Notional Amount would be reduced by the corresponding reduction in the Class C Note Principal Balance (as defined in the Indenture Supplement), the parties hereto shall treat the portion of such reduction (without duplication) as terminated on such Payment Date (a "Terminated Transaction"). Party A shall calculate the Market Quotation for the Terminated Transaction as set forth below.
"Market Quotation" means, with respect to a Terminated Transaction, an
amount determined on the basis of quotations from Reference Market-makers. Each
quotation will be for an amount, if any, that would be paid to Party A
(expressed as a negative number) or by Party A (expressed as a positive number)
in consideration of an agreement between Party A and the quoting Reference
Market-maker to enter into such Terminated Transaction (with the same fixed and
floating payment rates and remaining term as this Transaction) on the relevant
Payment Date. Party A will request each Reference Market-maker to provide its
quotation to the extent reasonably practicable as of the same day and time
(without regard to different time zones) on or as soon as reasonably practicable
prior to the relevant Payment Date. The day and time as of which those
quotations are to be obtained will be selected in good faith by Party A. If more
than three quotations are provided, the Market Quotation will be the arithmetic
mean of the quotations, without regard to the quotations having the highest and
lowest values. If exactly three such quotations are provided, the Market
Quotation will be the quotation remaining after disregarding the highest and
lowest quotations. For this purpose, if more than one quotation has the same
highest value or lowest value, then one of such quotations shall be disregarded.
If fewer than three quotations are provided, Party A will determine the Market
Quotation in good faith. Notwithstanding the foregoing, Party A shall be the
sole Reference Market-maker unless: (a) the reduction in the Notional Amount of
the Transaction is equal to or greater than $50 million on such Payment Date,
and (b) the Servicer or the Indenture Trustee requests that quotations from
Reference Market-makers other than Party A are utilized.
If the amount so determined by Party A in respect of a Terminated Transaction is positive, Party B shall owe such amount to Party A, which shall be payable (with interest thereon accruing from such Payment Date and calculated at the Fixed Rate) on the next Distribution Date to the extent provided in the Indenture. If such amount is negative, no amounts shall be payable by Party A or Party B in respect of the Terminated Transaction.
4. ACCOUNT DETAILS:
Account for payments to Party Name: Morgan Guaranty Trust Company of New A: York
City: New York
ABA# 021-000-238
Ref: World Financial Network Credit Card Master
Note Trust - Swaps Group
Acct: 67007054
Account for payments to Party Bank of New York
B: ABA #021-000-018
Name: World Financial Network Credit Card Master
Note Trust
|
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 500342
Collection Account Acct: 048171
5. OFFICES:
The Office of Party A for this 270 Park Avenue, 8th Floor
Transaction is:
New York, NY 10017
The Office of Party B for this 500 Stanton Christiana Road
Transaction is:
OPS4/ 3rd Floor
|
Please confirm that the foregoing correctly sets forth the terms and conditions of our agreement by responding within three (3) Business Days by returning via telecopier an executed copy of this Confirmation to the attention of Document Control (fax no. 212-648-8882).
Failure to respond within such period shall not affect the validity or enforceability of this Transaction, and shall be deemed to be an affirmation of the terms and conditions contained herein, absent manifest error.
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 500342
J.P. MORGAN SECURITIES INC., AS ACCEPTED AND CONFIRMED AS OF THE DATE
AGENT FOR MORGAN GUARANTY TRUST FIRST WRITTEN:
COMPANY OF NEW YORK
WORLD FINANCIAL NETWORK CREDIT
CARD MASTER NOTE TRUST,
BY: CHASE MANHATTAN BANK USA, NATIONAL
By: /s/ Sheri McCall ASSOCIATION, NOT IN ITS INDIVIDUAL
---------------------------- CAPACITY, BUT SOLELY AS OWNER TRUSTEE
Name: Sheri McCall
Title: Assistant Vice President
By: ____________________________ By: /s/ Denis Kelly
Name: ----------------------------------
Name and Title: Denis Kelly
Title: Assistant Vice President
|
WORLD FINANCIAL NETWORK CREDIT CARD MASTER NOTE TRUST
SERIES 2001-A CONFIRMATION
REFERENCE NUMBER 500342