SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported) March 6, 1998
CC Credit Card Corporation
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(Exact name of registrant as specified in its charter)
on behalf of the
Travelers Bank Credit Card Master Trust I
United States 333-40381 52-2069082
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(State or Other Jurisdiction (Commission File Number) (IRS Employer
of Incorporation) Identification
Number)
Suite 300B
100 Commerce Drive
Newark, Delaware 19713
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(Address of Principal Executive
Office) (Zip Code)
Registrant's telephone number, including area code (302) 451-6456
N/A
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(Former Name or Former Address, if Changed Since Last
Report)
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INFORMATION TO BE INCLUDED IN THE REPORT
Item 1. Not Applicable.
Item 2. Not Applicable.
Item 3. Not Applicable.
Item 4. Not Applicable.
Item 5. On March 6, 1998, the Travelers Bank Credit Card Master Trust I
issued its Class A 6.00% Asset Backed Certificates, Series 1998-1.
Item 6. Not Applicable.
Item 7. Exhibits.
The following are filed as Exhibits to this Report under Exhibits 1,
4.1, 4.2, 10.1 and 10.2.
Exhibit 1 Underwriting Agreement dated as of February 26, 1998.
Exhibit 4.1 Pooling and Servicing Agreement dated as of March 1,
1998.
Exhibit 4.2 Series 1998-A Supplement to the Amended and Restated
Pooling and Servicing Agreement dated as of March 1,
1998.
Exhibit 10.1 Receivables Transfer Agreement, dated as of March 1,
1998 between Travelers Bank & Trust, fsb and the
Transferor.
Exhibit 10.2 Receivables Transfer Agreement, dated as of March 1,
1998 between Travelers Bank USA and the Transferor
Item 8. Not Applicable.
Item 9. Not Applicable.
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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 their behalf by the
undersigned hereunto duly authorized.
CC Credit Card Corporation
On behalf of the Travelers Bank
Credit Card Master Trust I
By: /s/ Barbara Yastine
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Name: Barbara Yastine
Title: President
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EXHIBIT INDEX
Exhibit Description
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1 Underwriting Agreement Dated as of February 26, 1998.
4.1 Pooling and Servicing Agreement dated as of March 1,
1998.
4.2 Series 1998-A Supplement to the Amended and Restated
Pooling and Servicing Agreement dated as of March 1,
1998.
10.1 Receivables Transfer Agreement, dated as of March 1,
1998 between Travelers Bank & Trust, fsb and the
Transferor.
10.2 Receivables Transfer Agreement, dated as of March 1,
1998 between Travelers Bank USA and the Transferor.
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EXECUTION COPY
TRAVELERS BANK CREDIT CARD MASTER TRUST I
$227,500,000 Class A
6.00% Asset-Backed Certificates
Series 1998-1
UNDERWRITING AGREEMENT
February 26, 1998
Salomon Brothers Inc
Seven World Trade Center
New York, NY 10048
Chase Securities Inc.
270 Park Avenue
New York, NY 10017
Ladies and Gentlemen:
1. Introductory. CC Credit Card Corporation, a Delaware Corporation (the
"Transferor") proposes to cause the Travelers Bank Credit Card Master Trust I to
issue $227,500,000 aggregate principal amount of Class A 6.00% Asset-Backed
Certificates, Series 1998-1 (the "Class A Certificates") pursuant to the Pooling
and Servicing Agreement to be dated as of March 1, 1998, as supplemented by the
Series 1998-1 Supplement thereto, to be dated as of March 1, 1998 (together, the
"Pooling and Servicing Agreement") among the Transferor, Travelers Bank & Trust,
fsb, as servicer (in such capacity, the "Servicer") and The Bank of New York, as
trustee (the "Trustee").
Simultaneously with the issuance of the Class A Certificates the
Trust will issue $12,500,000 aggregate initial principal amount of Class B
Asset-Backed Certificates, Series 1998-1 (the "Class B Certificates") and
$10,000,000 aggregate initial principal amount of Class C Asset-Backed
Interests, Series 1998-1 (the "Class C Interests"). The Class B Certificates
will be subordinate to the Class A Certificates and the Class C Interests will
be subordinate to the Class A Certificates and the Class B Certificates. The
Class B Certificates and the Class C Interests will initially be retained by the
Transferor. The assets of the Trust (the "Trust Assets") will include, among
other things, certain amounts due (the "Receivables") on a pool of MasterCard(R)
and Visa(R) revolving credit card accounts (the "Accounts") owned by Travelers
Bank & Trust, fsb and The Travelers Bank USA. The Accounts will be selected by
Travelers Bank & Trust, fsb ("Travelers Bank, fsb") and by The Travelers Bank
USA ("Travelers Bank
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USA" and, collectively with Travelers Bank, fsb, the "Banks") and designated and
the Receivables therein transferred to the Transferor by the Banks pursuant to
separate Receivables Transfer Agreements, one between Travelers Bank, fsb and
the Transferor and the other between Travelers Bank USA and the Transferor and
each to be dated as of March 1, 1998 (collectively, the "Receivables Transfer
Agreements").
Capitalized terms used herein and not otherwise defined herein shall
have the meanings specified in the Pooling and Servicing Agreement.
The Transferor hereby agrees with Salomon Brothers Inc and Chase
Securities Inc. (the "Underwriters") as follows:
2. Representations and Warranties of the Transferor. The Transferor
represents and warrants to, and agrees with, the Underwriters that:
(a) The Transferor is a Delaware corporation duly organized and
validly existing in good standing under the laws of the State of Delaware, and
has all requisite corporate power and authority to own or lease its properties
and conduct its business as such properties are presently owned or leased and as
such business is presently conducted, and to execute, deliver and perform its
obligations under this Agreement, the Class A Certificates, the Pooling and
Servicing Agreement and the Receivables Transfer Agreements (the Pooling and
Servicing Agreement and the Receivables Transfer Agreements, together, the
"Transaction Documents").
(b) The execution and delivery of this Agreement, the Class A
Certificates and each of the Transaction Documents, the incurrence of the
obligations herein and therein set forth and the consummation of the
transactions contemplated hereunder and thereunder have been duly authorized by
the Transferor by all necessary action on the part of the Transferor.
(c) This Agreement has been duly authorized and validly executed and
delivered by the Transferor.
(d) Each of the Transaction Documents will be executed and delivered
by the Transferor on or before the Closing Date, and when executed and delivered
by the other parties thereto, each will constitute a valid and binding agreement
of the Transferor, enforceable against the Transferor in accordance with its
terms, except to the extent that (i) the enforceability thereof may be subject
to insolvency, reorganization, moratorium, receivership or other similar laws
now or hereafter in effect relating to creditors' or other obligees' rights
generally, (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) the enforceability of rights of indemnity thereunder may be subject to
limitations of public policy under applicable securities laws.
(e) The Class A Certificates when issued pursuant to the terms of
the Pooling and Servicing Agreement and, when executed by the Transferor and
authenticated by the Trustee in accordance with the Pooling and Servicing
Agreement and delivered pursuant to this Agreement, will be validly issued and
outstanding and entitled to the benefits of the Pooling and
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Servicing Agreement and the Class A Certificates will be, in all material
respects, in the form contemplated by the Pooling and Servicing Agreement and
will conform to the description thereof contained in the Prospectus and
Registration Statement, as amended or supplemented.
(f) The Transferor is not 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
violations or defaults separately or in the aggregate would have a material
adverse effect on the Transferor or the Trust.
(g) Neither the issuance and sale of the Class A Certificates, nor
the execution and delivery by the Transferor of this Agreement, the Class A
Certificates or the Transaction Documents, nor the incurrence by the Transferor
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, in any material respect, 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, in
any material respect, with, or result in a material breach of, or constitute a
default under any material provision of any indenture, contract, agreement,
deed, lease, mortgage 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 Pooling and Servicing Agreement.
(h) All consents, approvals, authorizations, orders, filings,
registrations or qualifications of or with any court or any other governmental
agency, board, commission, authority, official or body required in connection
with the execution and delivery by the Transferor of this Agreement, the Class A
Certificates or the Transaction Documents, 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.
(i) All actions required to be taken by the Transferor as a
condition to the offer and sale of the Class A Certificates as described herein
or the consummation of any of the transactions described in the Prospectus and
Registration Statement have been or, prior to the Closing Date, will be taken.
(j) The Pooling and Servicing Agreement is not required to be
qualified under the Trust Indenture Act of 1939.
(k) The representations and warranties made by the Transferor in the
Pooling and Servicing Agreement and made in any Officer's Certificate of the
Transferor delivered pursuant to the Pooling and Servicing Agreement will be
true and correct at the time made and on and as of the Closing Date as if set
forth herein.
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(l) 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,
except as provided in the Pooling and Servicing Agreement, and agrees to take
all action required to be taken by it under the Pooling and Servicing Agreement
in order to maintain the security interest in the Receivables granted pursuant
to the Pooling and Servicing Agreement, and upon execution and delivery of the
Pooling and Servicing Agreement by the Trustee, the Trustee will have acquired
beneficial ownership of all of the Transferor's right, title and interest in and
to the Receivables.
(m) A registration statement on Form S-3 (No. 333-40381), including
a form of prospectus and such amendments thereto as may have been required to
the date hereof, relating to the Class A Certificates 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 Securities
and Exchange Commission (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 Class A Certificates 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."
(n) On the Effective Date, the Registration Statement conformed in
all respects to the requirements of the Act and the rules and regulations of the
Commission thereunder (the "Rules and Regulations") and did 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 respects with the
requirements of the Act and the Rules and Regulations, and the Registration
Statement does not include, and will not include, any untrue statement of a
material fact or omit, and will not omit, to state any material fact required to
be stated therein or necessary to make the statements therein not misleading and
the Prospectus does not include and will not include, any untrue statement of a
material fact or omit, and will not omit, 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, except that the foregoing does not apply
to statements in or omissions from either of such documents based upon
information furnished to the Transferor by the Underwriters specifically for use
therein.
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(o) KPMG Peat Marwick, LLP are independent public accountants with
respect to the Transferor within the meanings of the Act and the Rules and
Regulations.
(p) The Trust is not now, and immediately following the sale of the
Class A Certificates pursuant to this Agreement will not be, required to be
registered under the Investment Company Act of 1940, as amended.
3. Representations and Warranties of the Banks. Each of the Banks (each,
respectively, a "Bank"), with respect to itself, represents and warrants to, and
agrees with, the Underwriters that:
(a) With respect to Travelers Bank, fsb, it is a federally chartered
savings bank duly organized and validly existing in good standing under the laws
of the United States, and, with respect to Travelers Bank USA, it is a Delaware
state-chartered bank, and the Bank has all requisite corporate power and
authority to own or lease its properties and conduct its business as such
properties are presently owned or leased and such business is presently
conducted, and to execute, deliver and perform its obligations under this
Agreement and each of the Transaction Documents to which it is party.
(b) With respect to Travelers Bank, fsb, it owns, possesses or has
obtained all licenses, permits, certificates, consents, orders, approvals and
other authorizations from, and has made all declarations and filings with, all
federal, state, local and other governmental authorities (including foreign
regulatory agencies), all self-regulatory organizations and all courts and other
tribunals, domestic or foreign, necessary to service the Receivables, except
such licenses, permits, certificates, consents, orders, approvals and other
authorizations the failure to own, possess or obtain does not and will not
separately or in the aggregate have a material adverse effect on the ability of
Travelers Bank, fsb to service the Receivables.
(c) The execution and delivery of this Agreement, and each of the
Transaction Documents to which it is a party, the incurrence of the obligations
herein and therein set forth and the consummation of the transactions
contemplated hereunder and thereunder have been duly authorized by the Bank by
all necessary action on the part of the Bank.
(d) The execution and delivery of this Agreement has been duly
authorized by the Bank.
(e) Each of the Transaction Documents to which the Bank is a party
will be executed and delivered by the Bank on or before the Closing Date, and
when executed and delivered by the other parties thereto, will constitute a
valid and binding agreement of the Bank, enforceable against the Bank in
accordance with its terms, except to the extent that (i) the enforceability
thereof may be subject to insolvency, reorganization, moratorium, receivership
or other similar laws now or hereafter in effect relating to creditors' or other
obligees' rights generally, (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) the enforceability of rights of indemnity thereunder
may be subject to limitations of public policy under applicable securities laws.
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(f) It is not 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 violations or
defaults separately or in the aggregate would have a material adverse effect on
the Bank or the Trust.
(g) Neither the issuance and sale of the Class A Certificates, nor
the execution and delivery by the Bank of this Agreement, or the Transaction
Documents to which it is a party, nor the incurrence by 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, nor the sale of the Receivables to the Corporation nor
the granting of a security interest in the Receivables to the Trustee does or
will (i), in any material respect, 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, in any material respect, with, or
result in a material breach of, or constitute a default under any material
provision of, any indenture, contract, agreement, deed, lease, mortgage 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 Receivables Transfer
Agreement to which it is a party.
(h) All consents, approvals, authorizations, orders, filings,
registrations or qualifications of or with any court or any other governmental
agency, board, commission, authority, official or body required in connection
with the execution and delivery by 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, except where the failure to do so would not have a material
adverse effect on the ability of the Bank to execute or deliver this Agreement
or the transaction Documents or to consummate the transactions contemplated
hereunder and thereunder or to fulfill the terms hereof and thereof.
(i) All actions required to be taken by the Bank as a condition to
the offer and sale of the Class A Certificates as described herein or the
consummation of any of the transactions described in the Prospectus and
Registration Statement have been or, prior to the Closing Date, will be taken.
(j) The representations and warranties made by the Bank in any of
the Transaction Documents to which it is a party and made in any Officer's
Certificate of the Bank delivered pursuant to any of the Transaction Documents
to which it is a party will be true and correct at the time made and on and as
of the Closing Date as if set forth herein.
(k) The Bank has not granted, assigned, pledged or transferred and
shall not grant, assign, pledge or transfer to any Person an ownership interest
or a security interest in, or any other right, title or interest in, the
Receivables, except as provided in the respective
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Receivables Transfer Agreement, and it agrees to take all action required by the
respective Receivables Transfer Agreement in order to provide for the transfer
of the Receivables to the Transferor or to maintain the security interest in the
Receivables granted pursuant to the Receivables Transfer Agreement, and upon
execution and delivery of the Pooling and Servicing Agreement by the Trustee,
the Trustee will have acquired beneficial ownership of all of the Bank's right,
title and interest in and to the Receivables.
(l) On the Effective Date, those statements in the Prospectus which
relate to the Bank or to the credit card activities of the Bank did not include
any untrue statement of a material fact or omit to state any material fact
necessary to make the statements relating to the Bank or the credit card
activities of the Bank, in light of the circumstances under which they were
made, not misleading, and on the date of this Agreement, and at the time of
filing of the Prospectus pursuant to Rule 424(b), the Prospectus does not
include, and will not include, any untrue statement of a material fact and does
not omit, and will not omit, to state any material fact necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, except that the foregoing does not apply to statements in or
omissions based upon information furnished to the Bank or the Transferor by the
Underwriters specifically for use therein.
(m) Since the respective dates as of which information is given in
the Registration Statement and the Prospectus, there has not been any material
adverse change, or any development involving a prospective material adverse
change, in or affecting the business, prospects, management, financial position
or results of operations of the Bank, taken as a whole, otherwise than as set
forth or contemplated in the Prospectus;
4. Purchase, Sale, Payment and Delivery of the Class A Certificates.
(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 Underwriters, and the Underwriters agree,
severally, and not jointly, to purchase from the Transferor, at a purchase price
of 99.65583% of the principal amount thereof, $227,500,000 aggregate principal
amount of the Class A Certificates, each Underwriter to purchase the amount set
forth opposite the name of such Underwriter on Schedule A hereto (or such
increased principal amount of Class A Certificates as set forth in Section 13
hereof).
(b) The Transferor will deliver the Class A Certificates to you
against payment of the purchase price in immediately available funds, drawn to
the order of the Transferor, at the office of Orrick, Herrington & Sutcliffe
LLP, in New York, New York at 10:00 A.M., New York City time, on March 6, 1998,
or at such other time not later than seven full business days thereafter as you
and the Transferor determine, such time being herein referred to as the "Closing
Date." Each of the Class A Certificates so to be delivered shall be represented
by one or more definitive certificates registered in the name of Cede & Co., as
nominee for The Depository Trust Company. The Transferor shall make such
definitive certificates representing the Class A Certificates available for
inspection by the Underwriters at the office at which the Class A Certificates
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.
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5. Offering by Underwriters. It is understood that after the Effective
Date, the Underwriters propose to offer the Class A Certificates for sale to the
public (which may include selected dealers) as set forth in the Prospectus.
6. 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
Class A Certificates covered thereby and the terms thereof not otherwise
specified in the Base Prospectus, the price at which such Class A Certificates
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 Class A Certificates or supplement to the Prospectus unless
a copy has been furnished to you for your review a reasonable time prior to the
proposed filing thereof or to which you shall reasonably object to in writing.
The Transferor will advise you 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 Class A Certificates 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 Class A
Certificates 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
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 your 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 7.
(c) As soon as practicable, the Transferor will cause the Trust to
make generally available to the Certificateholders 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 you copies of the Registration
Statement (one of which will include all exhibits) and all amendments thereto up
to the Closing Date, the preliminary prospectus related to the Class A
Certificates, the Prospectus and all amendments
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and supplements to such documents, in each case as soon as available and in such
quantities as you reasonably request.
(e) The Transferor will endeavor to qualify the Class A Certificates
for sale under the securities or blue sky laws of such jurisdictions as you
shall reasonably request and the determination of the eligibility for investment
of the Class A Certificates under the laws of such jurisdictions as you may
designate and will continue such qualifications in effect so long as required
for the distribution of the Class A Certificates; provided, however, that the
Transferor shall not be obligated to qualify to do business in any jurisdiction
where such qualification would subject it to general or unlimited service of
process in any jurisdiction where it is not now so subject.
(f) For a period from the date of this Agreement until the
retirement of the Class A Certificates, the Transferor will furnish to you or
will cause the Servicer to furnish to you copies of each certificate and the
annual statements of compliance delivered to the Trustee pursuant to Article III
of the Pooling and Servicing Agreement and the annual independent certified
public accountant's servicing reports furnished to the Trustee pursuant to
Article III of the Pooling and Servicing Agreement, by first class mail as soon
as practicable after such certificates, statements and reports are furnished to
the Trustee.
(g) So long as any Class A Certificate is outstanding, the
Transferor will furnish to you or will cause the Servicer to furnish to you, by
first-class mail as soon as practicable (i) all documents concerning the Class A
Certificates distributed by the Transferor or the Servicer to
Certificateholders, (ii) any order of the Commission under the Act or the
Securities Exchange Act of 1934, as amended (the "Exchange Act") applicable to
the Trust or to the Transferor as originator of the Trust, or pursuant to a
"no-action" letter obtained from the staff of the Commission by the Transferor
and affecting the Trust or the Transferor as originator of the Trust and (iii)
from time to time, such other information concerning the Trust as you 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 you hereunder, the Transferor will pay all expenses as provided in Section 12
hereof.
(i) To the extent, if any, that any of the ratings provided with
respect to the Class A Certificates by Moody's Investors Service, Inc. or
Standard & Poor's Ratings Services 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.
7. Conditions of the Obligations of the Underwriters. The obligation of
the Underwriters to purchase and pay for the Class A Certificates will be
subject to the accuracy of the representations and warranties on the part of the
Transferor and the Banks herein, to the accuracy of the statements of officers
of the Transferor and the Banks made pursuant to the provisions hereof, to the
performance by the Transferor and the Banks of their respective obligations
hereunder and to the following additional conditions precedent:
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(a) On or prior to the date of this Agreement, the Underwriters
shall have received a letter, dated the date of this Agreement, and a letter on
the Closing Date, dated the Closing Date of KPMG Peat Marwick LLP, 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
you and your counsel.
(b) The Prospectus shall have been filed with the Commission in
accordance with the Rules and Regulations and Section 6(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, the
Banks or you, shall be contemplated by the Commission.
(c) Subsequent to the execution and delivery of this Agreement,
there shall not have occurred (i) any change, or any development involving a
prospective change, in or affecting particularly the business or properties of
the Transferor or the Banks which, in your reasonable judgment, materially
impairs the investment quality of the Class A Certificates; (ii) any downgrading
in the rating of any securities of the Trust or any debt securities of
Commercial Credit Company by any "nationally recognized statistical rating
organization" (as defined for purposes of Rule 436(g) under the Act), or any
public announcement that any such organization has under surveillance or review
its rating of any such securities (other than an announcement with positive
implications of a possible upgrading, and no implication of a possible
downgrading, of such rating), (iii) any suspension or limitation of trading in
securities generally on the New York Stock Exchange, or any setting of minimum
prices for trading on such exchange, or any suspension of trading of any
securities of Commercial Credit Company or on any exchange or in the
over-the-counter market; (iv) any banking moratorium declared by Federal,
Delaware or New York authorities; or (v) any outbreak or escalation of major
hostilities in which the United States is involved, any declaration of war by
Congress or any other substantial national or international calamity or
emergency if, in your reasonable judgment, the effect of any such outbreak,
escalation, declaration, calamity or emergency makes it impractical or
inadvisable to proceed with completion of the sale of and payment for the Class
A Certificates.
(d) You shall have received an opinion, dated the Closing Date, of
A. Keith McClung, Esq., General Counsel for Commercial Credit Company, to the
effect that:
(i) CC Credit Card Corporation (x) has been duly organized and
is validly existing as a corporation under the laws of the State of
Delaware, with power and authority to own its properties and conduct its
business as described in the Prospectus; (y) is duly qualified or has
registered as a foreign corporation to do business in all states, if any,
where the nature of its business requires such qualification or
registration and in which the failure to so qualify would have a material
adverse effect on CC Credit Card Corporation; and (z) has the power and
authority to acquire and own the Receivables and to carry out its duties
and obligations under this Agreement, and each of the Transaction
Documents and to transfer the Receivables and the Trust Assets to the
Trust;
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(ii) CC Credit Card Corporation has the corporate power and
corporate authority to execute and deliver this Agreement, the Pooling and
Servicing Agreement, the Receivables Transfer Agreements and the Class A
Certificates and to consummate the transactions contemplated herein and
therein and to acquire and hold the Class B Certificates, the Class C
Interests and the Transferor's Certificate;
(iii) Each of the Pooling and Servicing Agreement, the
Receivables Transfer Agreements and the Class A Certificates has been duly
authorized, executed and delivered by CC Credit Card Corporation;
(iv) This Agreement has been duly authorized, executed and
delivered by CC Credit Card Corporation;
(v) The Registration Statement has become effective under the
Act and to the best of such counsel's knowledge no stop order suspending
the effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or threatened under the
Act; the Registration Statement, the Prospectus and each amendment thereof
or supplement thereto (other than the financial and statistical
information contained therein) on their respective effective dates or
dates of issuance appear on their face to be appropriately responsive in
all material respects to the applicable requirements of the Act and the
Rules and Regulations; such counsel has no reason to believe that either
the Registration Statement or the Prospectus, or any such amendment or
supplement, as of such respective dates, 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 amended or supplemented as of the date of such
opinion, contains any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they
were made, not misleading (except that such counsel may express no opinion
as to (y) any financial statements, schedules or other financial data
included in the Registration Statement, the Prospectus, or any such
amendment or supplement, or (z) the exhibits to the Registration
Statement); and the summaries in the Registration Statement and Prospectus
of statutes, legal proceedings, contracts and other documents are accurate
and fairly present the information required to be shown;
(vi) No consent, approval, authorization or order of, or
filing of UCC financing statements with any Delaware, New York or federal
court or governmental agency or body having jurisdiction over CC Credit
Card Corporation is required for the consummation of the transactions
contemplated by this Agreement, the Pooling and Servicing Agreement or the
Receivables Transfer Agreements, except for (v) filing of UCC financing
statements with respect to the transactions contemplated in the
Receivables Transfer Agreements and the Pooling and Servicing Agreement;
(w) such consents, approvals, authorizations, orders or filings as have
been obtained under the Act; (x) such consents, approvals, authorizations,
orders or filings as may be required under blue sky laws of any
jurisdiction; (y) such other consents, approvals, authorizations, orders
or filings as have been obtained; and (z) such consents, approvals,
authorizations,
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orders or filings the failure of which to obtain or perform will not have
any material adverse affect upon CC Credit Card Corporation's consummation
of the transactions contemplated by this Agreement, the Pooling and
Servicing Agreement or the Receivables Transfer Agreements.
(vii) The execution, delivery and performance by CC Credit
Card Corporation of this Agreement, the Pooling and Servicing Agreement
and the Receivables Transfer Agreements, the transfer of the Receivables
to the Trust, the issuance and sale of the Class A Certificates and the
consummation of any other of the transactions contemplated herein or in
the Pooling and Servicing Agreement or the Receivables Transfer Agreements
will not conflict with, result in a breach of or a violation of any of the
terms of, or constitute a default under, (x) the Certificate of
Incorporation or By-Laws of CC Credit Card Corporation or (y) any rule,
order, statute or regulation known to such counsel to be currently
applicable to CC Credit Card Corporation, or (z) any material agreement or
other material instrument, known to such counsel, to which CC Credit Card
Corporation is a party or by which it is bound; and
(viii) To such counsel's knowledge, there are no actions,
proceedings or investigations pending before any court, administrative
agency or other tribunal (w) asserting the invalidity of this Agreement,
the Pooling and Servicing Agreement, the Receivables Transfer Agreements
or the Class A Certificates, (x) seeking to prevent the issuance of the
Class A Certificates or the consummation of any of the transactions
contemplated by this Agreement, the Pooling and Servicing Agreement or the
Receivables Transfer Agreements, (y) which could reasonably be expected to
materially and adversely affect the performance by CC Credit Card
Corporation of its obligations under, or the validity or enforceability
of, this Agreement, the Pooling and Servicing Agreement, the Receivables
Transfer Agreements or the Class A Certificates or (z) seeking to affect
the federal income tax attributes of the Class A Certificates as described
in the Prospectus under the headings "Prospectus Summary -- Tax Status"
and "Federal Income Tax Consequences."
(e) You shall have received an opinion, dated the Closing Date, of
A. Keith McClung, Esq., General Counsel for Commercial Credit Company, as
counsel for Travelers Bank, fsb and for Travelers Bank USA, to the effect that:
(i) Travelers Bank, fsb has been duly chartered and is validly existing as
a federal savings bank under the laws of the United States and Travelers
Bank USA has been duly chartered and is validly existing as a Delaware
state chartered Bank under the laws of the State of Delaware, and (x) each
Bank has the power and authority to own its properties and conduct its
business as described in the Prospectus; (y) neither is required to
qualify, nor to register as a foreign corporation, in any state in order
to conduct its business, except those states where it has so qualified or
registered or where the failure to so qualify or register would not have a
material adverse effect upon the Class A Certificateholders; and (z) each
has the power and authority to own the Accounts and to sell, assign,
transfer and grant security rights in the Receivables;
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(ii) Each Bank has the power and authority to execute and deliver this
Agreement, and the Receivables Transfer Agreement to which it is a party
and Travelers Bank fsb has the power and authority to execute and deliver
the Pooling and Servicing Agreement and each Bank has the power and
authority to consummate the transactions contemplated by those documents
to which it is a party;
(iii) Each of this Agreement, and the respective Receivables Transfer
Agreements has been duly authorized, executed and delivered by the Banks
and the Pooling and Servicing Agreement has been duly authorized, executed
and delivered by Travelers Bank fsb;
(iv) No consent, approval, authorization or order of, or filing of UCC
financing statements with any Delaware, New York or federal court or
governmental agency or body having jurisdiction over the Travelers Bank,
fsb or Travelers Bank USA is required for the consummation of the
transactions contemplated by this Agreement, the Pooling and Servicing
Agreement or the Receivables Transfer Agreements, except for (v) filing of
UCC financing statements with respect to the transactions contemplated in
the Receivables Transfer Agreements; (w) such consents, approvals,
authorizations, orders or filings as have been obtained under the Act; (x)
such consents, approvals, authorizations, orders or filings as may be
required under blue sky laws of any jurisdiction; (y) such other consents,
approvals, authorizations, orders or filings as have been obtained; and
(z) such consents, approvals, authorizations, orders or filings the
failure of which to obtain or perform will not have any material adverse
affect upon the respective Bank's consummation of the transactions
contemplated by this Agreement, the Pooling and Servicing Agreement or the
Receivables Transfer Agreements.
(v) The execution, delivery and performance by Travelers Bank, fsb and by
Travelers Bank USA of this Agreement, the respective Receivables Transfer
Agreements, and, with respect to Travelers Bank, fsb, the Pooling and
Servicing Agreement, the transfer of the Receivables to the Transferor,
the issuance and sale of the Class A Certificates and the consummation of
any other of the transactions contemplated herein or in the Pooling and
Servicing Agreement or the Receivables Transfer Agreements will not
conflict with, result in a breach of or a violation of any of the terms
of, or constitute a default under, (x) the respective certificate of
incorporation or charter or by-laws of the Banks or (y) any rule, order,
statute or regulation known to such counsel to be currently applicable to
the respective Bank, or (z) any material agreement or other material
instrument, known to such counsel, to which the respective Bank is a party
or by which it is bound; and
(vi) To such counsel's knowledge, there are no actions, proceedings or
investigations pending before any court, administrative agency or other
tribunal (w) asserting the invalidity of this Agreement, the Receivables
Transfer Agreements or the Pooling and Servicing Agreement or the Class A
Certificates, (x) seeking to prevent the issuance of the Class A
Certificates or the consummation of any of the transactions contemplated
by this Agreement, the Receivables Transfer Agreements or the Pooling and
Servicing Agreement, (y) which could reasonably be expected to materially
and adversely affect the
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performance by either of the Banks of its obligations under, or the
validity or enforceability of, this Agreement, the Receivables Transfer
Agreements or the Pooling and Servicing Agreement or the Class A
Certificates or (z) seeking to affect the federal income tax attributes of
the Class A Certificates as described in the Prospectus under the headings
"Summary of Terms -- Tax Status" and "Federal Income Tax Consequences."
(f) You shall have received an opinion of Richards, Layton & Finger,
special counsel for the Transferor, or a letter to the effect that you may rely
on those provisions of their opinions to Moody's Investors Service, Inc. and
Standard & Poor's Ratings Services with respect to certain matters relating to
the transfer of the Receivables to the Transferor and to the Trust, with respect
to the perfection and priority of the Transferor's ownership interest in the
Receivables and to the perfection and priority of the Trust's interest in the
Receivables, and shall provide that the characterization of the Trust for
federal income tax purposes will be determinative of the character of the Trust
under the laws of the State of Delaware concerning any tax imposed or measured
by income, the Pooling and Servicing Agreement, including the allocation of
Collections provisions thereof, constitutes the legal, valid and binding
agreement of the Transferor and of Travelers Bank, fsb, enforceable against the
Transferor and Travelers Bank, fsb, in accordance with its terms, the Class A
Certificates are legally issued, fully paid and nonassessable and entitled to
the benefits of the Pooling and Servicing Agreement, the Receivables Transfer
Agreements are the legal, valid and binding agreements of the Transferor and the
respective Banks parties thereto, enforceable against the Transferor and the
Banks party thereto in accordance with their respective terms and with respect
to other related matters. In delivering such opinions, such counsel shall be
permitted to assume the due authorization, execution and delivery of documents
by the Banks and the due execution and delivery of documents by the Transferor.
(g) You shall have received an opinion dated the closing date, of
Orrick, Herrington & Sutcliffe LLP, special counsel to the Transferor, to the
effect that
(i) The statements in the Base Prospectus under the headings
"Certain Legal Aspects of the Receivables," "ERISA Considerations" and
"Federal Income Tax Consequences" and the summaries thereof under the
headings "Prospectus Summary -- Tax Status" in the Base Prospectus and
"Summary of Terms -- Tax Status" and "Federal Income Tax Consequences" in
the Prospectus Supplement, to the extent they constitute matters of law or
legal conclusions with respect thereto, have been reviewed by such counsel
and are correct in all material respects.
(ii) This Agreement, the Pooling and Servicing Agreement, the
Receivables Transfer Agreements and the Class A Certificates conform in
all material respects to the descriptions thereof contained in the
Prospectus.
(iii) The Pooling and Servicing Agreement is not required to
be qualified under the Trust Indenture Act of 1939, as amended, and the
Trust is not now, and immediately following the sale of the Class A
Certificates pursuant to this Agreement will not be, required to be
registered under the Investment Company Act of 1940, as amended.
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(iv) For federal income tax purposes the Class A Certificates
will properly be characterized as indebtedness and the Trust will not be
an association (or publicly traded partnership) taxable as a corporation;
such opinion may, however, provide that although the foregoing represents
the firm's views regarding the characteristics of the Trust and the Class
A Certificates for federal income tax purposes attention is directed to
the discussion of alternative characterizations and risks discussed in the
Base Prospectus under the heading "Federal Income Tax Consequences."
(h) You shall have received from Orrick, Herrington & Sutcliffe LLP,
special counsel for the Underwriters, (i) an opinion, dated the Closing Date, in
which such counsel shall state that, while they are not passing upon and do not
assume responsibility for the accuracy, completeness or fairness of the
statements contained in the Registration Statement or the Prospectus and
although they are not independently verifying the accuracy, completeness or
fairness of such statements, 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 an 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 Closing Date, 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 shall not be required to and will not make any comment with
respect to the financial statements, supporting schedules and other financial or
statistical information contained in the Registration Statement or the
Prospectus) and (ii) such other opinion or opinions, dated the Closing Date,
with respect to such matters relating to this transaction as you may require,
and, in each case, the Transferor and the Banks shall have furnished to such
counsel such documents as they request for the purpose of enabling them to pass
upon such matters.
(i) You shall have received a certificate from CC Credit Card
Corporation, dated the Closing Date, of two officers of CC Credit Card
Corporation, including at least one vice president or more senior officer or the
treasurer, in which certificate such officers each to the best of such officer's
knowledge after reasonable investigation, shall state that (u) the
representations and warranties of CC Credit Card Corporation in this Agreement
are true and correct in all material respects on and as of the Closing Date, (v)
CC Credit Card Corporation 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 CC Credit Card Company,
as Transferor, in the Pooling and Servicing Agreement are true and correct as of
the dates specified in the Pooling and Servicing Agreement, (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 officer's attention that would lead
such officer 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
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<PAGE>
material adverse change in the financial position or results of operation of CC
Credit Card Corporation's business except as set forth in or contemplated by the
Prospectus.
(j) You shall have received a certificate from Travelers Bank, fsb,
dated the Closing Date, of two vice presidents or more senior officers of
Travelers Bank, fsb (which shall include the secretary and treasurer of
Travelers Bank, fsb) in which such officers, each to the best of such officer's
knowledge after reasonable investigation, shall state that (u) the
representations and warranties of Travelers Bank, fsb in this Agreement are true
and correct in all material respects on and as of the Closing Date, (v)
Travelers Bank, fsb 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 Travelers Bank, fsb, as
Servicer, in the Pooling and Servicing Agreement are true and correct as of the
dates specified in the Pooling and Servicing Agreement, (x) nothing has come to
such officer's attention that would lead such officer 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, with respect to
Travelers Bank, fsb or its business or the Receivables transferred or to be
transferred by Travelers Bank, fsb, 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 (y) subsequent to the date of the Prospectus, there has been no
material adverse change in the financial position or results of operation of
Travelers Bank, fsb's credit card business except as set forth in or
contemplated by the Prospectus.
(k) You shall have received a certificate from Travelers Bank USA,
dated the Closing Date, of two vice presidents or more senior officers of
Travelers Bank USA (which shall include the secretary and treasurer of Travelers
Bank, USA) in which such officers, each to the best of such officer's knowledge
after reasonable investigation, shall state that (u) the representations and
warranties of Travelers Bank USA in this Agreement are true and correct in all
material respects on and as of the Closing Date, (v) Travelers Bank USA 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) nothing
has come to such officer's attention that would lead such officer 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 with
respect to Travelers Bank USA or its business or the Receivables transferred or
to be transferred by Travelers Bank USA, 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 (x) subsequent to the date of the Prospectus, there has been no
material adverse change in the financial position or results of operation of
Travelers Bank USA's credit card business except as set forth in or contemplated
by the Prospectus.
(l) You shall have received an opinion of Emmett Marvin & Martin,
counsel to the Trustee, addressed to you, dated the Closing Date, satisfactory
in form and substance to you and your counsel and substantially to the effect
that:
(i) The Trustee is a banking corporation organized and validly
existing and in good standing under the laws of the State of New York and
is authorized
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and qualified to accept the trusts imposed by the Pooling and Servicing
Agreement and to act as Trustee under the Pooling and Servicing Agreement;
(ii) The Pooling and Servicing Agreement has been duly
authorized, executed and delivered by the Trustee and constitutes a legal,
valid and binding obligation of the Trustee, enforceable against the
Trustee in accordance with its terms, except as enforcement thereof may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other similar laws relating to the enforcement of creditors' rights
generally and by general principles of equity (regardless of whether such
enforceability is considered in a proceeding in equity or at law);
(iii) The Class A Certificates have been duly authenticated
and delivered by the Trustee;
(iv) The execution and delivery of the Pooling and Servicing
Agreement by the Trustee and the performance by the Trustee of the terms
thereof does not conflict with or result in a violation of (y) any law or
regulation of the United States of America or the State of New York
governing the banking or trust powers of the Trustee, or (z) the
Organization Certificate or By-Laws of the Trustee; and
(v) No approval, authorization or other action by, or filing
with, any governmental authority of the United States of America or the
State of New York having jurisdiction over the banking or trust powers of
the Trustee is required in connection with the execution and delivery by
the Trustee of the Pooling and Servicing Agreement or the performance by
the Trustee thereunder.
(m) You shall have received evidence satisfactory to you that the
Class A Certificates shall be rated Aaa by Moody's Investors Service, Inc.
("Moody's") and AAA by Standard & Poor's Ratings Services ("S&P") and neither
Moody's nor S&P shall have placed the Class A Certificates under surveillance or
review with possible negative implications.
(n) The Class B Certificates and the Class C Interests shall have
been duly issued and registered to the Transferor.
(o) The Transferor Certificate shall have been duly issued and
delivered to the Transferor.
(p) The Receivables shall have been transferred to the Trust
pursuant to the Pooling and Servicing Agreement and in the amount described in
the Prospectus.
The Transferor will furnish you with such conformed copies of such
opinions, certificates, letters and documents as you reasonably request.
If any condition specified in this Section 7 shall not have been
fulfilled, this Agreement may be terminated by the Underwriters by notice to the
Transferor on or prior to the
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Closing Date and such termination shall be without liability of any party to any
other party except as provided in Section 12 hereof.
8. Indemnification and Contribution. (a) The Transferor and the Banks
jointly and severally, will indemnify and hold harmless the Underwriters, each
of their directors, any person who controls either of the Underwriters within
the meaning of Section 15 of the Act or Section 20 of the Exchange Act
(collectively, the "Indemnified Underwriter Parties") against any losses,
claims, damages or liabilities, joint or several, to which any of the
Indemnified Underwriter Parties 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, the preliminary prospectus, or any amendment or supplement thereto,
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 the Indemnified
Underwriter Parties for any legal or other expenses reasonably incurred by any
of the Indemnified Underwriter Parties in connection with investigating or
defending any such loss, claim, damage, liability or action as such expenses are
incurred; provided, however, that the foregoing indemnity with respect to the
preliminary prospectus shall not inure to the benefit of any of the Indemnified
Underwriter Parties (or to the benefit of any person controlling such
Indemnified Underwriter Party) from whom the person asserting any such losses,
claims, damages or liabilities purchased Class A Certificates if such untrue
statement or omission or alleged untrue statement or omission made in the
preliminary prospectus is eliminated or remedied in the Prospectus (as amended
or supplemented if the Transferor shall have furnished any amendments or
supplements thereto) and, if required by law, a copy of the Prospectus (as so
amended or supplemented) shall not have been furnished to such person at or
prior to the written confirmation of the sale of such Class A Certificates to
such person; provided further, however, that neither the Transferor or the Banks
will 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 written information furnished to the
Transferor by the Underwriters specifically for use therein.
(b) The Underwriters agree, severally and not jointly, to indemnify
and hold harmless the Transferor and the Banks, each of their directors, the
Transferor's Officers who signed the Registration Statement and any person who
controls the Transferor or either Bank within the meaning of Section 15 of the
Act or Section 20 of the Exchange Act (collectively, the "Indemnified Transferor
Parties") against any losses, claims, damages or liabilities to any of the
Indemnified Transferor Parties which may become subject, under the Act or
otherwise and will reimburse any legal or other expenses reasonably incurred by
the Indemnified Transferor Parties in connection with investigating or defending
any such loss, claim, damage, liability or action as such expenses are incurred,
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
preliminary prospectus or the Prospectus, or any amendment or supplement
thereto, 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
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the extent, that such untrue statement or alleged untrue statement or omission
or alleged omission was made in reliance upon and in conformity with written
information furnished to the Transferor or the Banks by the Underwriters
specifically for use therein, and will reimburse any legal or other expenses
reasonably incurred by the Indemnified Transferor Parties 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, 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 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
otherwise than under subsection (a) or (b) above, except to the extent the
indemnifying party is prejudiced thereby. In case any such action is brought
against any indemnified party and it notifies the indemnifying party of the
commencement thereof, the indemnifying party shall, after notice from the
indemnifying party to such indemnified party of its election so to assume the
defense thereof, 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 unless (i) the indemnifying party has agreed
in writing to pay such fees and expenses, (ii) the indemnifying party has failed
to assume the defense and employ counsel, or (iii) the named parties to any such
action, suit or proceeding (including any impleaded parties) include both the
indemnified party and the indemnifying party and such indemnified party shall
have been advised by its counsel that representation of such indemnified party
and the indemnifying party by the same counsel would be inappropriate under
applicable standards of professional conduct (whether or not such representation
by the same counsel has been proposed) due to actual or potential differing
interests between them (in which case the indemnifying parties shall not have
the right to assume the defense of such action, suit or proceeding on behalf of
such indemnified party). It is understood, however, that the indemnifying party
shall, in connection with any one such action, suit or proceeding or separate
but substantially similar or related actions, suits or proceedings in the same
jurisdiction arising out of the same general allegations or circumstances, be
liable for the reasonable fees and expenses of only one separate firm of
attorneys (in addition to any local counsel) at any time for all such
indemnified parties not having actual or potential differing interest with you
or among themselves, which firm shall be designated in writing by the
indemnified parties.
(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 Banks on the one hand and the
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Underwriters on the other from the offering of the Class A Certificates, 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 Banks 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 Banks
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 Class A Certificates received by the Transferor and the Banks
bear to the total underwriting discounts and commissions received by the
Underwriters with respect to the Class A Certificates. 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 or the Banks
or the Underwriters and the party's relative intent, knowledge, access to
information and opportunity to correct or prevent such untrue statement or
omission with respect to the Class A Certificates. 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 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
subdivision (d), the Underwriters shall not be required to contribute any amount
in excess of the amount by which the total price at which the Class A
Certificates underwritten by the Underwriters and distributed to the public were
offered to the public exceeds the amount of any 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 Class A
Certificates. 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 Banks under this
Section shall be in addition to any liability which the Transferor and the Banks
may otherwise have and shall extend, upon the same terms and conditions, to each
person, if any, who controls the Underwriters within the meaning of the Act; and
the obligations of the Underwriters under this section shall be in addition to
any liability which the Underwriters may otherwise have and shall extend, upon
the same terms and conditions, to each director of the Transferor, to each
officer of the Transferor who has signed the Registration Statement and to each
person, if any, who controls the Transferor within the meaning of the Act.
9. Survival of Certain Representations and Obligations; Third Party
Beneficiaries. The respective indemnities, agreements, representations,
warranties and other statements of the Transferor and of the Banks 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 Banks or any of their respective representatives, officers
or directors or any controlling person, and will survive delivery of and payment
for the Class A Certificates. If this Agreement is terminated or if for any
reason other than default by the Underwriters the purchase of the Class A
Certificates by the Underwriters is not consummated, the Transferor shall remain
responsible for the expenses to be paid or reimbursed by it pursuant to Section
6 and the respective obligations of the Transferor, the Banks and the
Underwriters pursuant to Section 8 shall remain in effect. If for any reason the
purchase of the Class A Certificates by the Underwriters is not consummated, the
Transferor will reimburse the Underwriters for all out-of-pocket expenses
(including reasonable fees and disbursements of counsel and reasonable costs and
expenses of printing) reasonably incurred by them in connection with the
offering of the Class A Certificates. This Agreement has been and is made solely
for the benefit of the Underwriters, the Underwriters'
20
<PAGE>
respective directors and controlling persons referred to in Section 8, the
Transferor, the Transferor's directors and officers, the Banks and the
controlling persons referred to in Section 8 hereof and their respective
successors and assigns, to the extent provided herein, and no other person shall
acquire or have any right under or by virtue of the Agreement. Neither the term
"successor" nor the term "successors and assigns" as used in this Agreement
shall include a purchaser from any Underwriter of any to the certificates in his
status as such purchaser.
10. Computational Materials and ABS Term Sheets. (a) Each Underwriter
agrees to provide to the Transferor, not less than two Business Days prior to
the date on which the Transferor is required to file the Prospectus Supplement
pursuant to Rule 424(b), any information used by it (in such written or
electronic format as required by the Transferor) with respect to the offering of
the Class A Certificates 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 (the "Kidder/PSA Letter")),
that is not contained in the Prospectus or the preliminary prospectus (without
taking into account information incorporated therein by reference).
(b) Each Underwriter agrees to provide to the Transferor, not less
than two Business Days prior to the date on which the Transferor is required to
file the Prospectus Supplement pursuant to Rule 424(b), any information used by
it (in such written or electronic format as required by the Transferor) with
respect to the offering of the Class A Certificates that constitutes "ABS Term
Sheets," as defined in the Commission's No-Action Letter, dated February 17,
1995, addressed to the Public Securities Association, that is not contained in
the Prospectus or the preliminary prospectus (without taking into account
information incorporated therein by reference).
(c) Each Underwriter severally agrees, assuming all information
provided by the Transferor and the Banks is accurate and complete in all
material respects, to indemnify and hold harmless the Transferor and the Banks,
each of the officers and directors of the Transferor and the Banks and each
person who controls the Transferor or a Bank within the meaning of Section 15 of
the Act against any and all losses, claims, damages or liabilities, joint or
several, to which they 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 of a material fact contained
in the Computational Materials or ABS Term Sheets, if any, provided by the
Underwriter, 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, in the light of the circumstances under which they
were made, not misleading, and agrees to reimburse each such indemnified party
for any legal or other expenses reasonably incurred by such indemnified party in
connection with investigating or defending or preparing to defend any such loss,
claim, damage, liability or action as such expenses are incurred. The
Underwriters shall not be required to contribute any amount in excess of the
amount by which the total price at which the Class A Certificates underwritten
by the Underwriters and distributed to the public were offered to the public
exceeds the amount of any damages which the Underwriters have otherwise been
required to pay by reason of such untrue
21
<PAGE>
or alleged untrue statement or omission or alleged omission with respect to the
Class A Certificates. The obligations of the Underwriter under this Section
10(c) shall be in addition to any liability that the Underwriter may otherwise
have.
The procedures set forth in Sections 8(c) and 8(d) shall be equally
applicable to this Section 10(c).
11. Notices. All communications hereunder will be in writing and, if sent
to the Underwriters, will be mailed, delivered or telegraphed and confirmed to:
Salomon Brothers Inc, Seven World Trade Center, New York, NY 10048, Attention:
Bob Malin.
12. Expenses. The Transferor agrees to pay the following costs and
expenses and all other costs and expenses incident to the performance by it of
its obligations hereunder (i) the preparation, printing (or reproduction), and
filing with the Commission of the registration statement (including exhibits
thereto), each preliminary prospectus, the Prospectus, each amendment or
supplement to any of them, this Agreement, the Receivables Transfer Agreements,
and the Pooling and Servicing Agreement; (ii) the printing (or reproduction) and
delivery (including postage, air freight charges and charges for counting and
packaging) of such copies of the registration statement, each preliminary
prospectus, the Prospectus, the exhibits thereto, the underwriting documents,
and all amendments or supplements to any of them, as may be reasonably requested
for use in connection with the offering and sale of the Class A Certificates;
(iii) the preparation, printing (or reproduction), execution and delivery of the
Transaction Documents and the preparation, printing, authentication, issuance
and delivery of the Class A Certificates; (iv) the printing (or reproduction)
and delivery of this Agreement, the preliminary and supplemental blue sky
memoranda and all other agreements or documents printed (or reproduced) and
delivered in connection with the offering of the Class A Certificates; (v) the
registration of the Class A Certificates under the Securities Act; (vi) the
registration or qualification of the Class A Certificates for offer and sale
under the securities or blue sky laws of the several states as provided in
Section 6(e) hereof (including the reasonable fees, expenses and disbursements
of counsel for the Underwriters relating to the preparation, printing (or
reproduction), and delivery of the preliminary and supplemental blue sky
memoranda and such registration and qualification); (vii) the fees and expenses
of the Trustee; (viii) the fees and expenses associated with obtaining ratings
for the Class A Certificates from national recognized statistical rating
organizations; (ix) the transportation and other expenses incurred by or on
behalf of the Transferor's and the Banks' representatives in connection with
presentations to prospective purchasers of the Class A Certificates; and (x) the
fees and expenses of the Transferor's and the Banks' accountants and the fees
and expenses of counsel (including local and special counsel) for the
Transferor.
13. Default of an Underwriter. If any one or more of the Underwriters
shall fail or refuse to purchase Class A Certificates which it or they are
obligated to purchase hereunder, and the aggregate principal amount of Class A
Certificates which such defaulting Underwriter or Underwriters are obligated but
fail or refuse to purchase is not more than one-tenth of the aggregate principal
amount of the Class A Certificates, each non-defaulting Underwriter shall be
obligated, severally, in the proportion which the principal amount of Class A
22
<PAGE>
Certificates set forth opposite its name on Schedule A hereto bears to the
aggregate principal amount of Class A Certificates set forth opposite the names
of all non-defaulting Underwriters or in such other proportion as you may
specify in accordance with any applicable agreement among underwriters, to
purchase the Class A Certificates which such defaulting Underwriter or
Underwriters are obligated, but failed or refused to purchase. If any
Underwriter or Underwriters shall fail or refuse to purchase Class A
Certificates and the aggregate principal amount of Class A Certificates with
respect to which such default occurs is more than one-tenth of the aggregate
principal amount of the Class A Certificates and arrangements satisfactory to
you and the Transferor for the purchase of such Class A Certificates by one or
more non-defaulting Underwriters or other party or parties approved by you and
the Transferor are not made within 36 hours after such default, this Agreement
will terminate without liability on the part of any non-defaulting Underwriter
or the Transferor. In any such case which does not result in termination of this
Agreement, either you or the Transferor shall have the right to postpone the
Closing Date, but in no event for longer than seven days, in order that the
required changes, if any, in the Registration Statement and the Prospectus or
any other documents or arrangements may be effected. Any action taken under this
paragraph shall not relieve any defaulting Underwriter from liability in respect
of any such default of any such Underwriter under this Agreement. The term
"Underwriter" as used in this Agreement includes, for all purposes in this
Agreement, any party not listed in Schedule A hereto who, with your approval and
the approval of the Transferor, purchases Class A Certificates which a
defaulting Underwriter is obligated, but fails or refuses, to purchase.
Any notice under this Section 13 may be given by telegram, telecopy or
telephone but shall be subsequently confirmed by letter.
14. Termination of Agreement. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of any
Underwriter to the Transferor by notice to the Transferor, if prior to the
Closing Date: (i) trading in securities generally on the New York Stock
Exchange, the American Stock Exchange or the NASDAQ National Market shall have
been suspended or materially limited, (ii) a general moratorium on commercial
banking activities in New York or Delaware shall have been declared by either
federal or state authorities, or (iii) there shall have occurred any outbreak or
escalation of hostilities or other international or domestic calamity, crisis or
change in political, financial or economic conditions, the effect of which on
the financial markets of the United States is such as to make it, in your
judgment, impracticable or inadvisable to commence or continue the offering of
the Class A Certificates on the terms set forth on the cover page of the
Prospectus or to enforce contracts for the release of the Class A Certificates
by the Underwriters. Notice of such termination may be given to the Transferor
by telegram, telecopy or telephone and shall be subsequently confirmed by
letter.
15. Information Furnished by the Underwriters. The statements set forth in
the last paragraph on the cover page, the stabilization legend on the inside
cover page, and the statements under the caption "Underwriting" in the
preliminary prospectus and in the Prospectus (except the last two paragraphs
thereof), constitute the only information furnished by or on behalf of the
Underwriters to the Transferor for use in the preliminary prospectus or in the
Prospectus as such information is referred to in Sections 2(n), 3(l) and 8(a)
hereof.
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16. Nonpetition Covenant. Each Underwriter agrees that it will not, prior
to the date which is one year and one day after the termination of the Pooling
and Servicing Agreement with respect to the Trust or the Transferor, acquiesce,
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.
17. 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.
18. Applicable Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO THE
CONFLICT OF LAWS PROVISIONS THEREOF.
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<PAGE>
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 Banks and
the Underwriters.
Very truly yours,
CC CREDIT CARD CORPORATION
By: /s/ Robert Matza
-----------------------------
Name: Robert Matza
Title: Treasurer and Director
The foregoing Agreement is TRAVELERS BANK & TRUST, fsb
hereby confirmed and accepted
as of the date hereof
By: /s/ Scott E. Powell
-----------------------------
Name: Scott E. Powell
Title: Vice President
SALOMON BROTHERS INC,
as Representative of the
Underwriters set forth herein
THE TRAVELERS BANK USA
By: /s/ John C. Dahl By: /s/ Scott E. Powell
------------------------- -----------------------------
Name: John C. Dahl Name: Scott E. Powell
Title: Associate Title: Vice President
[Underwriting Agreement Signature Page]
<PAGE>
SCHEDULE A
Class A Certificates
Principal Amount of
Underwriters Class A Certificates
- ------------ --------------------
Salomon Brothers Inc $205,000,000
Chase Securities Inc. $ 22,500,000
Exhibit 4.1
EXECUTION COPY
- --------------------------------------------------------------------------------
CC CREDIT CARD CORPORATION,
as Transferor,
TRAVELERS BANK & TRUST, fsb,
as Servicer,
and
THE BANK OF NEW YORK,
as Trustee
TRAVELERS BANK CREDIT CARD MASTER TRUST I
POOLING AND SERVICING AGREEMENT
Dated as of March 1, 1998
- --------------------------------------------------------------------------------
<PAGE>
Page
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TABLE OF CONTENTS
ARTICLE I
Definitions
Section 1.01. Definitions.............................................. 1
Section 1.02. Other Definitional Provisions............................ 21
ARTICLE II
Conveyance of Receivables
Section 2.01. Conveyance of Receivables................................ 23
Section 2.02. Acceptance by Trustee.................................... 24
Section 2.03. Representations and Warranties of Each Transferor
Relating to Such Transferor.............................. 25
Section 2.04. Representations and Warranties of Each Transferor
Relating to the Agreement, the Receivables Transfer
Agreements and Any Supplement and the Receivables........ 27
Section 2.05. Reassignment of Ineligible Receivables................... 29
Section 2.06. Reassignment of Receivables in Trust Portfolio........... 30
Section 2.07. Covenants of the Transferor.............................. 31
Section 2.08. Covenants of Each Transferor with Respect to Receivables
Transfer Agreements...................................... 35
Section 2.09. Addition of Accounts..................................... 36
Section 2.10. Removal of Accounts and Participation Interests.......... 39
Section 2.11. Account Allocations...................................... 41
Section 2.12. Discount Option.......................................... 41
Section 2.13. Security Interest Granted by Travelers Bank & Trust, fsb. 42
ARTICLE III
Administration and Servicing
of Receivables
Section 3.01. Acceptance of Appointment and Other Matters Relating
to the Servicer.......................................... 43
Section 3.02. Servicing Compensation................................... 44
Section 3.03. Representations, Warranties and Covenants of the
Servicer..................................................44
Section 3.04. Reports and Records for the Trustee...................... 47
Section 3.05. Annual Certificate of Servicer........................... 47
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Section 3.06. Annual Servicing Report of Independent Public
Accountants; Copies of Reports Available................. 48
Section 3.07. Tax Treatment............................................ 48
Section 3.08. Notices to Travelers Bank & Trust, fsb................... 49
Section 3.09. Adjustments.............................................. 49
Section 3.10. Reports to the Commission................................ 49
Section 3.11. Reports to Rating Agencies............................... 50
ARTICLE IV
Rights of Certificateholders and
Allocation and Application of Collections
Section 4.01. Rights of Certificateholders............................. 51
Section 4.02. Establishment of Collection Account and Excess Funding
Account; Appointment of Securities Intermediary.......... 51
Section 4.03. Collections and Allocations.............................. 54
Section 4.04. Shared Collections....................................... 55
Section 4.05. Additional Withdrawals from the Collection Account....... 57
Section 4.06. Allocation of Trust Assets to Series or Groups........... 57
ARTICLE V
Distributions and Reports to
Certificateholders
ARTICLE VI
The Certificates
Section 6.01. The Certificates......................................... 59
Section 6.02. Authentication of Certificates........................... 59
Section 6.03. New Issuances............................................ 59
Section 6.04. Registration of Transfer and Exchange of Certificates.... 61
Section 6.05. Mutilated, Destroyed, Lost or Stolen Certificates........ 64
Section 6.06. Persons Deemed Owners.................................... 64
Section 6.07. Appointment of Paying Agent.............................. 65
Section 6.08. Access to List of Registered Certificateholders'
Names and Addresses...................................... 65
Section 6.09. Authenticating Agent..................................... 66
Section 6.10. Book-Entry Certificates.................................. 67
Section 6.11. Notices to Clearing Agency............................... 67
Section 6.12. Definitive Certificates.................................. 67
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Section 6.13. Global Certificate; Exchange Date........................ 68
Section 6.14. Meetings of Certificateholders........................... 69
Section 6.15. Uncertificated Classes................................... 71
ARTICLE VII
Other Matters Relating to the Transferor
Section 7.01. Liability of the Transferor.............................. 72
Section 7.02. Merger or Consolidation of, or Assumption of the
Obligations of, the Transferor........................... 72
Section 7.03. Limitations on Liability of the Transferor............... 73
ARTICLE VIII
Other Matters Relating to the Servicer
Section 8.01. Liability of the Servicer................................ 74
Section 8.02. Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer............................. 74
Section 8.03. Limitation on Liability of the Servicer and Others....... 74
Section 8.04. Servicer Indemnification of the Trust and the Trustee.... 75
Section 8.05. The Servicer Not To Resign............................... 75
Section 8.06. Access to Certain Documentation and Information
Regarding the Receivables................................ 76
Section 8.07. Delegation of Duties..................................... 76
Section 8.08. Examination of Records................................... 76
ARTICLE IX
Pay Out Events
Section 9.01. Trust Pay Out Events..................................... 77
Section 9.02. Rights Upon the Occurrence of an Insolvency Even......... 77
ARTICLE X
Servicer Defaults
Section 10.01. Servicer Defaults....................................... 78
Section 10.02. Trustee To Act, Appointment of Successor................ 80
Section 10.03. Notification to Certificateholders...................... 81
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ARTICLE XI
The Trustee
Section 11.01. Duties of Trustee....................................... 82
Section 11.02. Certain Matters Affecting the Trustee................... 83
Section 11.03. Trustee Not Liable for Recitals in Certificates......... 84
Section 11.04. Trustee May Own Certificates............................ 85
Section 11.05. The Transferor To Pay Trustee's Fees and Expenses....... 85
Section 11.06. Eligibility Requirements for Trustee.................... 85
Section 11.07. Resignation or Removal of Trustee....................... 85
Section 11.08. Successor Trustee....................................... 86
Section 11.09. Merger or Consolidation of Trustee...................... 86
Section 11.10. Appointment of Co-Trustee or Separate Trustee........... 87
Section 11.11. Tax Returns............................................. 88
Section 11.12. Trustee May Enforce Claims Without Possession of
Certificates............................................ 88
Section 11.13. Suits for Enforcement................................... 88
Section 11.14. Rights of Certificateholders To Direct Trustee.......... 89
Section 11.15. Representations and Warranties of Trustee............... 89
Section 11.16. Maintenance of Office or Agency......................... 89
ARTICLE XII
Termination
Section 12.01. Termination of Trust.................................... 91
Section 12.02. Final Distribution...................................... 91
Section 12.03. Transferor's Termination Rights......................... 92
Section 12.04. Defeasance.............................................. 92
Section 12.05. Optional Purchase....................................... 94
ARTICLE XIII
Miscellaneous Provisions
Section 13.01. Amendment; Waiver of Past Defaults...................... 95
Section 13.02. Protection of Right, Title and Interest to Trust........ 96
Section 13.03. Limitation on Rights of Certificateholders.............. 97
Section 13.04. GOVERNING LAW........................................... 98
Section 13.05. Notices; Payments....................................... 98
Section 13.06. Rule 144A Information................................... 99
Section 13.07. Severability of Provisions.............................. 99
Section 13.08. Assignment.............................................. 99
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Section 13.09. Certificates Nonassessable and Fully Paid............... 99
Section 13.11. Further Assurances...................................... 99
Section 13.12. Nonpetition Covenant....................................100
Section 13.13. No Waiver; Cumulative Remedies..........................100
Section 13.14. Counterparts............................................100
Section 13.15. Third-Party Beneficiaries...............................100
Section 13.16. Actions by Certificateholders...........................100
Section 13.17. Merger and Integration..................................100
Section 13.18. Headings................................................101
Section 13.19. Construction of Agreement...............................101
EXHIBITS
Exhibit A Form of Transferor Certificate
Exhibit B Form of Assignment of Receivables in Additional Accounts
Exhibit C Form of Reassignment of Receivables in Removed Accounts
Exhibit D Form of Annual Servicer's Certificate
Exhibit E-1 Private Placement Legend
Exhibit E-2 Representation Letter
Exhibit E-3 ERISA Legend
Exhibit F-1 Form of Certificate of Foreign Clearing Agency
Exhibit F-2 Form of Alternate Certificate to be delivered to Foreign Clearing
Agency
Exhibit F-3 Form of Certificate to be delivered to Foreign Clearing Agency
Exhibit G-1 Form of Opinion of Counsel with respect to Amendments
Exhibit G-2 Form of Opinion of Counsel with respect to Accounts
Exhibit H Amendment to Section 9.02
SCHEDULES
Schedule 1 List of Accounts [Deemed Incorporated]
v
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POOLING AND SERVICING AGREEMENT dated as of March 1, 1998, among CC
CREDIT CARD CORPORATION, a Delaware corporation, as Transferor, TRAVELERS BANK &
TRUST, fsb, a federally-chartered savings bank, as Servicer, and THE BANK OF NEW
YORK, a New York banking corporation, as Trustee.
In consideration of the mutual agreements herein contained, each
party agrees as follows for the benefit of the other parties, the
Certificateholders and any Series Enhancer (to the extent provided herein and in
any Supplement):
ARTICLE I
Definitions
Section 1.01. Definitions. Whenever used in this Agreement, the
following words and phrases shall have the following meanings, and the
definitions of such terms are applicable to the singular as well as the plural
forms of such terms and to the masculine as well as to the feminine and neuter
genders of such terms.
"Account" shall mean each Initial Account and each Additional
Account, but shall exclude any Account in which all the Receivables are either
reassigned or assigned to the Transferor or its designee or the Servicer in
accordance with the terms of this Agreement. The definition of Account shall
include each account into which an Account is transferred (a "Transferred
Account"); provided that (i) such transfer is made in accordance with the Credit
Card Guidelines and (ii) such Transferred Account can be traced or identified,
by reference to or by way of the computer files or microfiche lists delivered to
the Trustee pursuant to Section 2.01 or 2.09, as an account into which an
Account has been transferred. The term "Account" shall be deemed to refer to an
Additional Account only from and after the Addition Date with respect thereto,
and the term "Account" shall be deemed to refer to any Removed Account only
prior to the Removal Date with respect thereto.
"Account Owner" shall mean Travelers Bank & Trust, fsb, The
Travelers Bank USA or any other entity which is the issuer of the credit card
relating to an Account pursuant to a Cardholder Agreement.
"Accumulation Period" shall mean, with respect to any Series, or any
Class within a Series, a period following the Revolving Period, which shall be
the accumulation or other period, including any controlled accumulation period
or rapid accumulation period, in which Collections of Principal Receivables are
accumulated in an account for the benefit of the Investor Certificateholders of
such Series, or a Class within such Series, in each case as defined for such
Series in the related Supplement.
"Act" shall mean the Securities Act of 1933, as amended.
<PAGE>
"Addition" shall mean the designation of (i) additional Eligible
Accounts to be included as Accounts or (ii) Participation Interests to be
included as Trust Assets pursuant to subsection 2.09(a), (b) or (d).
"Addition Cut-Off Date" shall mean, with respect to any Additional
Accounts or Participation Interests to be included in the Trust, the date
specified in the related Assignment.
"Addition Date" shall mean (i) with respect to Additional Accounts,
the date on which the Receivables in such Additional Accounts are conveyed to
the Trust pursuant to subsection 2.09(a), (b) or (d) and (ii) with respect to
Participation Interests, the date from and after which such Participation
Interests are to be included as Trust Assets pursuant to subsection 2.09(a) or
(b).
"Additional Account" shall mean each consumer revolving credit card
account established pursuant to a Cardholder Agreement, which account is
designated pursuant to subsection 2.09(a), (b) or (d) to be included as an
Account and is identified in a computer file or microfiche list delivered to the
Trustee by the Transferor pursuant to Sections 2.01 and 2.09.
"Additional Transferors" shall have the meaning specified in
subsection 2.09(e).
"Adverse Effect" shall mean, with respect to any action, that such
action will (a) result in the occurrence of a Pay Out Event or Reinvestment
Event with respect to any Series or (b) materially adversely affect the amount
or timing of distributions to be made to the Investor Certificateholders of any
Series or Class pursuant to this Agreement and the related Supplement.
"Affiliate" shall mean, with respect to any specified Person, any
other Person controlling or controlled by or under common control with such
specified Person. For the purposes of this definition, "control" shall mean the
power to direct the management and policies of a Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms "controlling" and "controlled" have meanings correlative to the
foregoing.
"Aggregate Investor Amount" shall mean, as of any date of
determination, the sum of (i) the aggregate Investor Amounts of all Series of
Certificates issued and outstanding on such date of determination plus (ii) the
sum of the Enhancement Investor Amounts, if any, for all outstanding Series on
such date of determination.
"Aggregate Series Percentage" shall mean, with respect to Principal
Receivables, Defaulted Receivables and Finance Charge Receivables as of any date
of determination, the sum of the Series Percentages for such categories of
Receivables for all outstanding Series on such date of determination; provided,
however, that the Aggregate Series Percentage shall not exceed 100%.
2
<PAGE>
"Agreement" shall mean this Pooling and Servicing Agreement and all
amendments hereof and supplements hereto, including, with respect to any Series
or Class, the related Supplement.
"Amortization Period" shall mean, with respect to any Series, or any
Class within a Series, a period following the Revolving Period, which shall be
the controlled amortization period, controlled accumulation period, the
principal amortization period, the rapid amortization period, the rapid
accumulation period, the optional amortization period, the limited amortization
period or other amortization period or accumulation period, in each case as
defined with respect to such Series in the related Supplement.
"Applicants" shall have the meaning specified in Section 6.08.
"Assignment" shall have the meaning specified in subsection
2.09(c)(vii).
"Authorized Newspaper" shall mean any newspaper or newspapers of
general circulation in the Borough of Manhattan, the City of New York, printed
in the English language (and, with respect to any Series or Class, if and so
long as the Investor Certificates of such Series or Class are listed on the
Luxembourg Stock Exchange and such exchange shall so require, in Luxembourg,
printed in any language satisfying the requirements of such exchange) and
customarily published on each business day at such place, whether or not
published on Saturdays, Sundays or holidays.
"Automatic Additional Account" shall have the meaning specified in
subsection 2.09(d)(i).
"Bearer Certificates" shall have the meaning specified in Section
6.01.
"Benefit Plan" shall have the meaning specified in subsection
6.04(c) .
"Book-Entry Certificates" shall mean beneficial interests in
(including security entitlements relating thereto) the Investor Certificates,
ownership and transfers of which shall be made through book entries by a
Clearing Agency as described in Section 6.10.
"Business Day" shall mean any day other than (a) a Saturday or
Sunday, (b) any other day on which banking institutions in New York, New York
(or, with respect to any Series, any additional city specified in the related
Supplement) or any other State in which the principal executive offices of CC
Credit Card Corporation or any Additional Transferor or the Trustee are located,
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 applicable Series Supplement.
"Cardholder Agreement" shall mean, with respect to a consumer
revolving credit card account, the agreements between an Account Owner, and the
related Obligor governing the terms and conditions of such account, as such
agreements may be amended, modified or otherwise changed from time to time and
as distributed (including any amendments and revisions thereto) to holders of
such account.
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"Cash Advance Fees" shall have the meaning specified in the
Cardholder Agreement applicable to an Account for cash advance fees or similar
terms.
"Cedel" shall mean Cedel Bank, societe anonyme, a professional
depository incorporated under the laws of Luxembourg, and its successors.
"Certificate" shall mean any one of the Investor Certificates or the
Transferor Certificates.
"Certificateholder" or "Holder" shall mean an Investor
Certificateholder or a Person in whose name any one of the Transferor
Certificates is registered.
"Certificateholders' Interest" shall have the meaning specified in
Section 4.01.
"Certificate Owner" shall mean, with respect to a Book-Entry
Certificate, the Person who is the owner of such Book-Entry Certificate, as
reflected on the books of the Clearing Agency, or on the books of a Person
maintaining an account with such Clearing Agency (directly or as an indirect
participant, in accordance with the rules of such Clearing Agency).
"Certificate Rate" shall mean, with respect to any Series or Class,
the certificate rate specified therefor in the related Supplement.
"Certificate Register" shall mean the register maintained pursuant
to Section 6.04, providing for the registration of the Registered Certificates
and the Transferor Certificates and transfers and exchanges thereof.
"Class" shall mean, with respect to any Series, any one of the
classes of Investor Certificates of that Series.
"Clearing Agency" shall mean an organization registered as a
"clearing agency" pursuant to Section 17A of the Securities Exchange Act of
1934, as amended, and serving as a clearing agency for a Series or Class of
Book-Entry Certificates.
"Clearing Agency Participant" shall mean a broker, dealer, bank,
other financial institution or other Person for whom from time to time a
Clearing Agency effects book entry transfers and pledges of securities deposited
with the Clearing Agency.
"Closing Date" shall mean, with respect to any Series, the closing
date specified in the related Supplement.
"Code" shall mean the Internal Revenue Code of 1986, as amended from
time to time.
"Collection Account" shall have the meaning specified in Section
4.02.
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"Collections" shall mean all payments by or on behalf of Obligors
(including Insurance Proceeds) received in respect of the Receivables, in the
form of cash, checks (to the extent collected), wire transfers, electronic
transfers, ATM transfers or other form of payment in accordance with the
Cardholder Agreement in effect from time to time. Collections shall not,
however, include Recoveries or Interchange. As specified in any Participation
Interest Supplement or Supplement, Collections shall include amounts received
with respect to Participation Interests.
"Commission" shall mean the United States Securities and Exchange
Commission.
"Companion Series" shall mean (i) each Series which has been paired
with another Series (which Series may be prefunded or partially prefunded), such
that the reduction of the Investor Amount of such Series results in the increase
of the Investor Amount of such other Series, as described in the related
Supplements, and (ii) such other Series.
"Contractually Delinquent" with respect to an Account, shall mean an
Account as to which the required minimum payment set forth on the related
billing statement has not been received by the due date thereof.
"Corporate Trust Office" shall mean the principal office of the
Trustee at which at any particular time its corporate trust business shall be
administered, which office at the date of the execution of this Agreement is
located at 101 Barclay Street, New York, New York 10286.
"Coupon" shall have the meaning specified in Section 6.01.
"Credit Card Guidelines" shall mean the written policies and
procedures of Travelers Bank & Trust, fsb, The Travelers Bank USA or any other
Account Owner, as the case may be, relating to the operation of its consumer
revolving lending business, including, without limitation, the written policies
and procedures for determining the creditworthiness of credit card account
customers, the extension of credit to credit card account customers and relating
to the maintenance of credit card accounts and collection of receivables with
respect thereto, as such policies and procedures may be amended, modified, or
otherwise changed from time to time.
"Date of Processing" shall mean, with respect to any transaction or
receipt of Collections, the Business Day such transaction or receipt of
Collections is first recorded on the Servicer's computer file of consumer
revolving credit card accounts (without regard to the effective date of such
recordation).
"Defaulted Amount" shall mean, with respect to any Monthly Period,
an amount (which shall not be less than zero) equal to (a) the amount of
Principal Receivables which became Defaulted Receivables in such Monthly Period,
minus (b) the amount of any Defaulted Receivables included in any Account the
Receivables of which the Transferor or the Servicer became obligated to accept
reassignment or assignment in accordance with the
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terms of this Agreement during such Monthly Period; provided, however, that, if
an Insolvency Event occurs with respect to the Transferor, the amount of such
Defaulted Receivables which are subject to reassignment to the Transferor in
accordance with the terms of this Agreement shall not be added to the sum so
subtracted and, if any of the events described in subsection 10.01(d) occur with
respect to the Servicer, the amount of such Defaulted Receivables which are
subject to reassignment or assignment to the Servicer in accordance with the
terms of this Agreement shall not be added to the sum so subtracted.
"Defaulted Receivables" shall mean, with respect to any Monthly
Period, all Principal Receivables which are charged off as uncollectible in such
Monthly Period in accordance with the Credit Card Guidelines and the Servicer's
customary and usual servicing procedures for servicing consumer revolving credit
card and other revolving credit account receivables comparable to the
Receivables. A Principal Receivable shall become a Defaulted Receivable on the
day on which such Principal Receivable is recorded as charged off on the
Servicer's computer master file of consumer revolving credit card accounts but,
in any event, shall be deemed a Defaulted Receivable no later than the month
following the day the related Account becomes 180 days Contractually Delinquent
unless the Obligor cures such default by making a partial payment which
satisfies the criteria for curing delinquencies set forth in the applicable
Credit Card Guidelines.
"Defeasance" shall have the meaning specified in subsection
12.04(a).
"Defeased Series" shall have the meaning specified in subsection
12.04(a).
"Definitive Certificates" shall have the meaning specified in
Section 6.10.
"Definitive Euro-Certificates" shall have the meaning specified in
Section 6.13.
"Depositaries" shall mean the Person specified in the applicable
Supplement, in its capacity as depositary for the respective accounts of any
Clearing Agency or any Foreign Clearing Agencies.
"Depository Agreement" shall mean, if applicable with respect to any
Series or Class, the depository agreement among the Transferor, the Trustee and
a Clearing Agency, or as otherwise provided in the related Supplement.
"Determination Date" shall mean, unless otherwise specified in the
related Supplement, with respect to any Distribution Date, the third Business
Day preceding such Distribution Date.
"Discount Option Collections" shall have the meaning specified in
Section 2.12. The aggregate amount of Discount Option Collections on any Date of
Processing shall equal the product of (a) the amount of any Collections of
Principal Receivables received on such Date of Processing and (b) the Discount
Percentage, if any, in effect on such Date of Processing.
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"Discount Option Date" shall have the meaning specified in Section
2.12.
"Discount Percentage" shall have the meaning specified in Section
2.12.
"Distribution Date" shall mean, unless otherwise defined in a
Supplement with respect to a Series, the fifteenth day of each calendar month
or, if such fifteenth day is not a Business Day, the next succeeding Business
Day.
"Dollars," "$" or "U.S. $" shall mean United States Dollars.
"Eligible Account" shall mean a consumer revolving credit card
account owned by Travelers Bank & Trust, fsb or The Travelers Bank USA, in the
case of the Initial Accounts, or Travelers Bank & Trust, fsb or The Travelers
Bank USA or other Account Owner, in the case of Additional Accounts, which
accounts are identified by the relevant Account Owner as of the Initial Cut-Off
Date or Addition Cut-Off Date, as applicable, as having the following
characteristics:
(a) is in existence and maintained by Travelers Bank & Trust, fsb or
The Travelers Bank USA, in the case of the Initial Accounts, or Travelers Bank &
Trust, fsb, The Travelers Bank USA or other Account Owner in the case of
Additional Accounts;
(b) is payable in Dollars;
(c) is not a corporate account;
(d) except as provided below, has not been identified as an account
the credit card or cards with respect to which have been reported to the
applicable Account Owner as having been lost or stolen;
(e) the Obligor of which has provided, as his or her billing
address, an address located in the United States (or its territories or
possessions or military address);
(f) except as provided below, does not have any Receivables which
are Defaulted Receivables; and
(g) except as provided below, does not have any Receivables which
have been identified by the applicable Account Owner or the relevant Obligor as
having been incurred as a result of fraudulent use of any related credit card.
Eligible Accounts may include Accounts, the Receivables of which
have been written off, or with respect to which the Transferor believes the
related Obligor is bankrupt, or as to which certain Receivables have been
identified by the Obligor as having been incurred as a result of fraudulent use
of any credit cards, or as to which any credit cards have been reported to the
Account Owner or the Servicer as lost or stolen, in each case as of the Initial
Cut-Off Date, with respect to the Initial Accounts, and as of the related
Addition Cut-Off Date, with respect to Additional Accounts; provided that (a)
the balance of all Receivables included in such Accounts is reflected on the
books and records of the Account
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Owner (and is treated for purposes of this Agreement) as "zero," and (b)
charging privileges with respect to all such Accounts have been canceled in
accordance with the relevant Credit Card Guidelines.
"Eligible Institution" shall mean a depository institution (which
may be the Trustee) 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) which depository institution at all times (a) has either (i)
a long-term unsecured debt rating of A1 or better by Moody's or (ii) a
certificate of deposit rating of P-1 by Moody's, (b) has either (i) a long-term
unsecured debt rating of AAA by Standard & Poor's or (ii) a certificate of
deposit rating of A-1+ by Standard & Poor's and (c) is a member of the FDIC.
Notwithstanding the previous sentence, any institution the appointment of which
satisfies the Rating Agency Condition shall be considered an Eligible
Institution. If so qualified, the Trustee or the Servicer may be considered an
Eligible Institution for the purposes of this definition.
"Eligible Investments" shall mean securities, instruments,
securities entitlements or other investment property with respect to:
(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 Rating Agency;
(c) commercial paper or other short-term obligations
having initial maturities of no more than 270 days, and having, at
the time of the Trust's investment or contractual commitment to
invest therein, a rating from each Rating Agency in its highest
investment category;
(d) notes or bankers' acceptances (having original
maturities of no more than 365 days) issued by any depository
institution or trust company referred to in (b) above;
(e) investments in money market funds rated in the
highest investment category by each Rating Agency or otherwise
approved in writing by each Rating Agency;
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<PAGE>
(f) time deposits, other than as referred to in clause
(e) above, with a Person the commercial paper of which has a credit
rating from each Rating Agency in its highest investment category;
or
(g) any other investments approved in writing by each
Rating Agency.
"Eligible Receivable" shall mean each Receivable:
(a) which has arisen under an Eligible Account;
(b) which was created in compliance with all
Requirements of Law applicable to the institution which owned the
Receivable at the time of its creation, the failure to comply with
which would have a material adverse effect on Investor
Certificateholders, and pursuant to a Cardholder Agreement which
complies in all material respects with all Requirements of Law
applicable to the Account Owner, the failure to comply with which
would have a material adverse effect on Investor Certificateholders;
(c) with respect to which all material consents,
licenses, approvals or authorizations of, or registrations or
declarations with, any Governmental Authority required to be
obtained or given by the Account Owner, in connection with the
creation of such Receivable or the execution, delivery and
performance by the Account Owner of its obligations, if any, under
the related Cardholder Agreement have been duly obtained or given
and are in full force and effect as of such date of creation of such
Receivable;
(d) as to which, at the time of the transfer of such
Receivable to the Trust, the Transferor or the Trust will have good
and marketable title thereto, free and clear of all Liens (other
than any Lien for municipal or other local taxes if such taxes are
not then due and payable or if the Transferor is then contesting the
validity thereof in good faith by appropriate proceedings and has
set aside on its books adequate reserves with respect thereto);
(e) which has been the subject of either a valid
transfer and assignment from the Transferor to the Trust of all the
Transferor's right, title and interest therein or the grant of a
first priority perfected security interest therein (and in the
proceeds thereof), effective until the termination of the Trust;
(f) which at and after the time of transfer to the Trust
is the legal, valid and binding payment obligation of the Obligor
thereon, legally enforceable against such Obligor in accordance with
its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws, now or hereafter in effect, affecting the
enforcement of creditors' rights in general and except as such
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enforceability may be limited by general principles of equity
(whether considered in a suit at law or in equity);
(g) which constitutes either an "account" or a "general
intangible" under and as defined in Article 9 of the UCC;
(h) which, at the time of its transfer to the Trust, has
not been waived or modified except as permitted in accordance with
the Credit Card Guidelines and which waiver or modification is
reflected in the Servicer's computer file of revolving credit card
accounts;
(i) which, 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 applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights in general and except as such
enforceability may be limited by general principles of equity
(whether considered in a suit at law or equity) or as to which the
Servicer is required by Section 3.09 to make an adjustment;
(j) as to which, at the time of its transfer to the
Trust, the relevant Account Owner has satisfied all its obligations
required to be satisfied by such time; and
(k) as to which, at the time of its transfer to the
Trust, none of the Transferor, the Servicer, Travelers Bank & Trust,
fsb, The Travelers Bank USA or any other Account Owner, as the case
may be, has taken any action which, or failed to take any action the
omission of which, would, at the time of its transfer to the Trust,
impair the rights of the Trust or the Certificateholders therein.
"Eligible Servicer" shall mean the Trustee, or if the Trustee is not
acting as Servicer, an entity which, at the time of its appointment as Servicer,
(a) is servicing a portfolio of revolving credit card accounts, (b) is legally
qualified and has the capacity to service the Accounts (including, if
applicable, the ability to service MasterCard and VISA credit card accounts),
(c) is qualified to use the software that is then being used to service the
Accounts or obtains the right to use, or has its own software, which is adequate
to perform its duties under this Agreement, (d) has demonstrated the ability to
professionally and competently service a portfolio of similar accounts in
accordance with high standards of skill and care, and (e) has a net worth of at
least $50,000,000 as of the end of its most recent fiscal quarter.
"Enhancement Agreement" shall mean any agreement, instrument or
document governing the terms of any Series Enhancement or pursuant to which any
Series Enhancement is issued or outstanding.
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"Enhancement Investor Amount" shall have the meaning, if applicable
with respect to any Series, specified in the related Supplement.
"ERISA" shall mean the Employee Retirement Income Security Act of
1974, as amended.
"Euroclear Operator" shall mean Morgan Guaranty Trust Company of New
York, Brussels office, as operator of the Euroclear System.
"Excess Allocation Series" shall mean a Series that, pursuant to the
Supplement therefor, is entitled to receive Excess Finance Charge Collections,
as more specifically set forth in the Supplement. If so specified in the
Supplement for a Group of Series, such Series may be Excess Allocation Series
only for the Series in such Group.
"Excess Finance Charge Collections" shall have the meaning specified
in subsection 4.04(b).
"Excess Funding Account" shall have the meaning specified in Section
4.02.
"Excess Funding Amount" shall mean the amount on deposit in the
Excess Funding Account.
"Excess Spread" with respect to each Series shall have the meaning
specified in the applicable Supplement.
"Excess Transferor Finance Charge Collections" shall have the
meaning specified in subsection 4.04(c).
"Exchange Date" shall mean, with respect to any Series, any date
that is after the related Closing Date, in the case of Definitive
Euro-Certificates in registered form, or upon presentation of certification of
non-United States beneficial ownership (as described in Section 6.13), in the
case of Definitive Euro-Certificates in bearer form.
"FDIC" shall mean the Federal Deposit Insurance Corporation or any
successor.
"Finance Charge Receivables" shall mean all amounts billed to the
Obligors on any Account in respect of (i) Periodic Finance Charges, (ii) annual
membership fees and annual service charges, (iii) Late Fees, (iv) Overlimit
Fees, (v) Cash Advance Fees and (vi) all other fees and charges with respect to
the Accounts designated by the Transferor to be included as Finance Charge
Receivables. Collections of Finance Charge Receivables shall not, however,
include Recoveries or Interchange. Finance Charge Receivables shall also include
the interest portion of Participation Interests as shall be determined pursuant
to the applicable Participation Interest Supplement or Supplement.
"Finance Charge Shortfall" shall have the meaning specified in
subsection 4.04(b).
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"FIRREA" shall mean the Financial Institutions Reform, Recovery and
Enforcement Act of 1989, as amended.
"Foreign Clearing Agency" shall mean Cedel and the Euroclear
Operator.
"Global Certificate" shall have the meaning specified in subsection
6.13(a).
"Governmental Authority" shall mean the United States of America,
any state or other political subdivision thereof and any entity exercising
executive, legislative, judicial, regulatory or administrative functions of or
pertaining to government.
"Group" shall mean, with respect to any Series, the group of Series,
if any, in which the related Supplement specifies such Series is to be included.
"Ineligible Receivables" shall have the meaning specified in
subsection 2.05(a).
"Initial Account" shall mean each MasterCard(R) and VISA(R)(1)
account established pursuant to a Cardholder Agreement between Travelers Bank &
Trust, fsb or The Travelers Bank USA and any Person, and identified by account
number and by the Receivable balance in a computer file or microfiche list
delivered to the Trustee by the Transferor on or prior to the Initial Closing
Date pursuant to Section 2.01.
"Initial Closing Date" shall mean March 6, 1998.
"Initial Cut-Off Date" shall mean December 31, 1997.
"Insolvency Event" shall have the meaning specified in subsection
9.01(a)(i).
"Insurance Proceeds" shall mean any amounts recovered by the
Servicer pursuant to any credit insurance policies covering any Obligor with
respect to Receivables under such Obligor's Account.
"Interchange" shall mean interchange fees payable to any Account
Owner, in its capacity as credit card issuer, through MasterCard or VISA in
connection with cardholder charges for goods, services and cash advances.
"Investment Company Act" shall mean the Investment Company Act of
1940, as amended from time to time.
"Investor Amount" shall mean, with respect to any Series and for any
date, an amount equal to the Investor Amount specified in the related
Supplement.
- --------
(1) MasterCard and VISA are registered trademarks of MasterCard International
Incorporated and of VISA USA, Inc., respectively.
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"Investor Certificateholder" shall mean the Person in whose name a
Registered Certificate is registered in the Certificate Register or the bearer
of any Bearer Certificate (or the Global Certificate, as the case may be) or
Coupon.
"Investor Certificates" shall mean any certificated or
uncertificated interest in the Trust designated as, or deemed to be, an
"Investor Certificate" in the related Supplement.
"Late Fees" shall have the meaning specified in the Cardholder
Agreement applicable to each Account for late fees or similar terms.
"Lien" shall mean any mortgage, deed of trust, pledge,
hypothecation, assignment, participation or equity interest, deposit
arrangement, encumbrance, lien (statutory or other), preference, priority or
other security agreement or preferential arrangement of any kind or nature
whatsoever, including any conditional sale or other title retention agreement,
any financing lease having substantially the same economic effect as any of the
foregoing and the filing of any financing statement under the UCC (other than
any such financing statement filed for informational purposes only) or
comparable law of any jurisdiction to evidence any of the foregoing, excluding
any lien or filing pursuant to this Agreement; provided, however, that any
assignment or transfer pursuant to subsection 6.03(c) or (d) or Section 7.02
shall not be deemed to constitute a Lien.
"Manager" shall mean the lead manager, manager or co-manager or
Person performing a similar function with respect to an offering of Definitive
Euro-Certificates.
"MasterCard" shall mean MasterCard International Incorporated.
"Monthly Period" shall mean, with respect to each Distribution Date,
unless otherwise provided in a Supplement, the period from and including the
first day of the preceding calendar month to and including the last day of such
calendar month; provided, however, that the initial Monthly Period with respect
to any Series will be as designated in the related Supplement.
"Monthly Servicing Fee" shall have the meaning specified in Section
3.02.
"Moody's" shall mean Moody's Investors Service, Inc., or its
successor.
"Notices" shall have the meaning specified in subsection 13.05(a).
"Obligor" shall mean, with respect to any Account, the Person or
Persons obligated to make payments with respect to such Account, including any
guarantor thereof, but excluding any merchant.
"Officer's Certificate" shall mean, unless otherwise specified in
this Agreement, a certificate delivered to the Trustee signed by the Chairman of
the Board, President, any Vice President or the Treasurer of the Transferor or
the Servicer, as the case may be.
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"Opinion of Counsel" shall mean a written opinion of counsel, who
may be counsel for, or an employee of, the Person providing the opinion and who
shall be reasonably acceptable to the Trustee.
"Overlimit Fees" shall have the meaning specified in the Cardholder
Agreement applicable to each Account for overlimit fees or similar terms if such
fees are provided for with respect to such Account.
"Participation Interests" shall have the meaning specified in
subsection 2.09(a)(ii).
"Participation Interest Supplement" shall mean a Supplement entered
into pursuant to subsections 2.09(a)(ii) and 13.01(a) in connection with the
conveyance of Participation Interests to the Trust.
"Participating Transferor" shall have the meaning specified in
subsection 2.09(c)(i).
"Paying Agent" shall mean any paying agent and co-paying agent
appointed pursuant to Section 6.07 and shall initially be the Trustee; provided,
that if the Supplement for a Series so provides, a Paying Agent may be appointed
with respect to such Series.
"Pay Out Event" shall mean, with respect to each Series, a Trust Pay
Out Event or a Series Pay Out Event.
"Periodic Finance Charges" shall have the meaning specified in the
Cardholder Agreement applicable to each Account for finance charges (due to
periodic rate) or any similar term.
"Person" shall mean any legal person, including any individual,
corporation, partnership, joint venture, association, joint-stock company,
trust, unincorporated organization, governmental entity or other entity of
similar nature.
"Principal Receivable" shall mean all amounts charged by Obligors
for merchandise and services, cash advances and check advances, but shall not
include Finance Charge Receivables or Defaulted Receivables. Principal
Receivables shall also include the principal portion of Participation Interests
as shall be determined pursuant to the applicable Participation Interest
Supplement or Supplement. In calculating the aggregate amount of Principal
Receivables on any day, the amount of Principal Receivables shall be reduced by
the aggregate amount of credit balances in the Accounts on such day. Any
Receivables which the related Transferor is unable to transfer as provided in
Section 2.11 shall not be included in calculating the aggregate amount of
Principal Receivables, except to the extent so provided in Section 2.11.
"Principal Sharing Series" shall mean a Series that, pursuant to the
Supplement therefor, is entitled to receive Shared Principal Collections. If so
specified in the
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Supplement for a Group of Series, such Series may be Principal Sharing Series
only for the Series in such Group.
"Principal Shortfalls" shall have the meaning specified in
subsection 4.04(a).
"Principal Terms" shall mean, with respect to any Series, (i) the
name or designation; (ii) the Initial Investor Amount, the Series Investor
Amount and the Series Invested Amount (or method for calculating such amounts);
(iii) the Certificate Rate (or method for the determination thereof); (iv) the
payment date or dates and the date or dates from which interest shall accrue;
(v) the method for allocating Collections to Certificateholders of such Series;
(vi) the designation of any Series Accounts and the terms governing the
operation of any such Series Accounts; (vii) the method of calculating the
servicing fee with respect thereto; (viii) the terms of any form of Series
Enhancement with respect thereto; (ix) the terms on which the Investor
Certificates of such Series may be exchanged for Investor Certificates of
another Series, repurchased by the Transferor or remarketed to other investors;
(x) the Series Termination Date; (xi) the number of Classes of Investor
Certificates of such Series and, if such Series consists of more than one Class,
the rights and priorities of each such Class; (xii) the extent to which the
Investor Certificates of such Series will be issuable in temporary or permanent
global form (and, in such case, the depositary for such Global Certificate or
Certificates, the terms and conditions, if any, upon which such Global
Certificate may be exchanged, in whole or in part, for Definitive Certificates,
and the manner in which any interest payable on a temporary or Global
Certificate will be paid); (xiii) whether the Investor Certificates of such
Series may be issued as Bearer Certificates and any limitations imposed thereon;
(xiv) the priority of such Series with respect to any other Series; (xv) the
Group, if any, to which such Series belongs; (xvi) whether or not such Series is
a Principal Sharing Series, whether such Series is an Excess Allocation Series,
and whether such Series is entitled to share Excess Transferor Finance Charge
Collections and Shared Transferor Principal Collections; and (xvii) any other
terms of such Series.
"Qualified Account" shall mean either (a) a segregated trust account
established with the corporate trust department of a Securities Intermediary or
(b) a segregated account with a Securities Intermediary that is an Eligible
Institution.
"Rating Agency" shall mean, with respect to any outstanding Series
or Class, each statistical rating agency selected by the Transferor to rate the
Investor Certificates of such Series or Class, as specified in the related
Supplement.
"Rating Agency Condition" shall mean, with respect to any action,
that each Rating Agency shall have notified the Transferor in writing that such
action will not result in a reduction or withdrawal of the rating of any
outstanding Series or Class with respect to which it is a Rating Agency.
"Reassignment" shall have the meaning specified in Section 2.10.
"Receivable" shall mean all amounts shown on the Servicer's records
as amounts payable by Obligors on any Account from time to time, including
amounts payable
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for Principal Receivables and Finance Charge Receivables. Receivables which
become Defaulted Receivables will cease to be included as Receivables as of the
day on which they become Defaulted Receivables.
"Receivables Transfer Agreements" shall mean, (i) the receivables
transfer agreement between Travelers Bank & Trust, fsb and the Transferor and
(ii) the receivables transfer agreement between The Travelers Bank USA and the
Transferor, each dated as of March 1, 1998, and in each case as amended from
time to time in accordance with the terms thereof, and (iii) any receivables
transfer agreement, substantially in the form of the agreements entered into by
Travelers Bank & Trust, fsb and The Travelers Bank USA, entered into between the
Transferor and an Account Owner in the future; provided, that before the
Transferor shall enter into any additional receivables transfer agreement as
described in (iii) of this definition, (A) the Rating Agency Condition is
satisfied with respect to such receivables transfer agreement and (B) the
Transferor shall have delivered to the Trustee an Officer's Certificate to the
effect that such officer reasonably believes that the execution and delivery of
such receivables transfer agreement and the purchase of Receivables from the
Account Owner named therein will not have an Adverse Effect.
"Record Date" shall mean, with respect to any Distribution Date, the
last Business Day of the preceding Monthly Period, except as otherwise provided
with respect to a Series in the related Supplement.
"Recoveries" shall mean amounts, excluding Insurance Proceeds,
received by the Servicer with respect to Receivables which have previously
become Defaulted Receivables.
"Registered Certificateholder" shall mean the Holder of a Registered
Certificate.
"Registered Certificates" shall have the meaning specified in
Section 6.01.
"Reinvestment Event" shall mean, with respect to any Series, such
event or events, if any, specified in the Supplement as an event resulting in a
rapid accumulation period with respect to such Series, which may include events
designated herein as Trust Pay Out Events.
"Removal Cut-Off Date" shall have the meaning specified in
subsection 2.10(b).
"Removal Date" shall have the meaning specified in subsection
2.10(a).
"Removal Notice Date" shall have the meaning specified in subsection
2.10(a).
"Removed Accounts" shall have the meaning specified in Section 2.10.
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"Required Designation Date" shall have the meaning specified in
subsection 2.09(a).
"Required Principal Balance" shall mean, as of any date of
determination, an amount equal to the difference between (a) the sum of the
Series Investor Amounts for each Series outstanding on such date, minus (b) the
Excess Funding Amount.
"Required Transferor Amount" shall mean, with respect to any date,
an amount equal to (i) the product of the Required Transferor Percentage and
(ii)(a) the aggregate amount of Principal Receivables times (b) one minus the
Discount Percentage.
"Required Transferor Percentage" shall mean 5%; provided, however,
that the Transferor may reduce the Required Transferor Percentage upon (x) 30
days' prior notice to the Trustee and each Rating Agency, (y) satisfaction of
the Rating Agency Condition with respect thereto and (z) delivery to the Trustee
of a certificate of a Vice President or more senior officer of the Transferor
stating that the Transferor reasonably believes that such reduction will not,
based on the facts known to such officer at the time of such certification, then
or thereafter have an Adverse Effect; provided further, that the Required
Transferor Percentage shall not at any time be less than 2%.
"Requirements of Law" with respect to any Person shall mean the
certificate of incorporation or articles of association and by-laws or other
organizational or governing documents of such Person, and any law, treaty, rule
or regulation, or determination of an arbitrator or Governmental Authority, in
each case applicable to or binding upon such Person or to which such Person is
subject, whether Federal, state or local (including, without limitation, usury
laws, the Federal Truth in Lending Act and Regulation Z and Regulation B of the
Board of Governors of the Federal Reserve System).
"Responsible Officer" shall mean any officer within the Corporate
Trust Office (or any successor group of the Trustee) including any Vice
President, any Assistant Secretary, any Assistant Treasurer, or any other
officer of the Trustee customarily performing functions similar to those
performed by any of the above-designated officers and also, with respect to a
particular matter, any other officer to whom such matter is referred because of
such officer's knowledge of and familiarity with the particular subject.
"Revolving Credit Agreement" shall mean the Funding Agreement dated
March 6, 1998 between the Transferor and Commercial Credit Company.
"Revolving Period" shall mean, with respect to any Series, the
period specified as such in the related Supplement.
"RTC" shall mean the Resolution Trust Corporation or any successor.
"Rule 144A" shall mean Rule 144A under the Act, as such Rule may be
amended from time to time.
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"Securities Intermediary" shall mean The Bank of New York or any
other entity that is a depository institution that in the ordinary course of its
business maintains securities accounts for others and is acting in that capacity
and which is 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) which has a credit rating from each Rating Agency in one of its
generic credit rating categories which signifies investment grade.
"Series" shall mean any series of Investor Certificates established
pursuant to a Supplement.
"Series Account" shall mean any deposit, trust, escrow or similar
account maintained for the benefit of any Series or Class, as specified in any
Supplement.
"Series Enhancement" shall mean the rights and benefits provided to
the Investor Certificateholders of any Series or Class pursuant to any letter of
credit, surety bond, cash collateral account, cash collateral guaranty, spread
account, guaranteed rate agreement, maturity liquidity facility, tax protection
agreement, interest rate swap agreement, interest rate cap agreement or other
similar arrangement. The subordination of any Series or Class to another Series
or Class shall be deemed to be a Series Enhancement.
"Series Enhancer" shall mean the Person or Persons providing any
Series Enhancement, other than the Investor Certificateholders of any Series or
Class which is subordinated to another Series or Class.
"Series Invested Amount" shall have, with respect to any Series, the
meaning specified in the related Supplement.
"Series Investor Amount" shall have, with respect to any Series, the
meaning specified in the related Supplement.
"Series Pay Out Event" shall mean, with respect to any Series, each
event, if any, specified in the Supplement as a Series Pay Out Event with
respect to such Series.
"Series Percentage" shall have, with respect to Principal
Receivables, Finance Charge Receivables and Defaulted Receivables, and any
Series of Certificates, the meaning stated in the related Supplement.
"Series Termination Date" shall mean, with respect to any Series,
the termination date for such Series specified in the related Supplement.
"Servicer" shall mean initially Travelers Bank & Trust, fsb and its
permitted successors and assigns, in its capacity as Servicer pursuant to this
Agreement, and thereafter any Person appointed Successor Servicer as herein
provided.
"Servicer Default" shall have the meaning specified in Section
10.01.
"Servicing Fee" shall have the meaning specified in Section 3.02.
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"Servicing Fee Rate" shall mean, with respect to any Series, the
servicing fee rate specified in the related Supplement.
"Servicing Officer" shall mean any officer of the Servicer, or any
attorney-in-fact of the Servicer, involved in, or responsible for, the
administration and servicing of the Receivables whose name appears on a list of
servicing officers furnished to the Trustee by the Servicer, as such list may
from time to time be amended.
"Shared Principal Collections" shall have the meaning specified in
subsection 4.04(a).
"Shared Transferor Principal Collections" shall have the meaning
specified in Section 4.04(d).
"Standard & Poor's" shall mean Standard & Poor's Ratings Group or
its successor.
"Successor Servicer" shall have the meaning specified in subsection
10.02(a).
"Supplement" shall mean, with respect to any Series, a Supplement to
this Agreement, executed and delivered in connection with the original issuance
of the Investor Certificates of such Series pursuant to Section 6.03, and all
amendments thereof and supplements thereto.
"Supplemental Certificate" shall have the meaning specified in
subsection 6.03(c).
"Tax Opinion" shall mean, with respect to any action, an Opinion of
Counsel to the effect that, (a) for Federal income tax purposes, such action
will not adversely affect the tax characterization of Investor Certificates of
any outstanding Series or Class that were characterized as debt at the time of
their issuance, (b) such action will not cause the Trust to be deemed to be an
association (or publicly traded partnership) taxable as a corporation and (c)
such action will not cause or constitute an event in which gain or loss would be
recognized by any Investor Certificateholder or the Trust.
"Termination Notice" shall have the meaning specified in Section
10.01.
"Transfer Agent and Registrar" shall have the meaning specified in
Section 6.04.
"Transfer Date" shall mean the Business Day immediately preceding
each Distribution Date.
"Transfer Restriction Event" shall have the meaning specified in
Section 2.11
"Transferor" shall mean (a) CC Credit Card Corporation, a
wholly-owned special purpose subsidiary of Commercial Credit Company and
incorporated in the state of
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Delaware, or its successor under this Agreement and (b) any Additional
Transferor or Transferors. References to "each Transferor" shall refer to each
entity mentioned in the preceding sentence and references to "the Transferor"
shall refer to all such entities.
"Transferor Amount" shall mean, on any date of determination, an
amount equal to (i) the sum of (a) an amount equal to the product of (x) the
aggregate amount of Principal Receivables at the end of the day immediately
prior to such date of determination times (y) one minus the Discount Percentage,
plus (b) the Excess Funding Amount at the end of the day immediately prior to
such date of determination, minus (ii) the sum of the Series Invested Amounts
for each Series outstanding on such date at the end of such day.
"Transferor Certificate" shall mean the certificate executed by the
Transferor and authenticated by or on behalf of the Trustee, substantially in
the form of Exhibit A, as the same may be modified in accordance with subsection
2.09(e).
"Transferor Certificates" shall mean, collectively, the Transferor
Certificate and any outstanding Supplemental Certificates.
"Transferor Percentage" shall mean, on any date of determination,
when used with respect to Principal Receivables, Finance Charge Receivables and
Defaulted Receivables, a percentage equal to 100% minus the Aggregate Series
Percentage with respect to such categories of Receivables.
"Transferor's Interest" shall have the meaning specified in Section
4.01.
"Transferred Account" shall have the meaning set forth in the
definition of "Account."
"Travelers Bank & Trust, fsb" shall mean Travelers Bank & Trust,
fsb, a federally chartered savings bank, and its successors and assigns.
"The Travelers Bank USA" shall mean The Travelers Bank USA, a
Delaware state chartered bank corporation, and its successors and assigns.
"Trust" shall mean the Travelers Bank Credit Card Master Trust I
created by this Agreement.
"Trust Assets" shall have the meaning specified in Section 2.01.
"Trustee" shall mean The Bank of New York, in its capacity as
trustee on behalf of the Trust, or its successor in interest, or any successor
trustee appointed as herein provided.
"Trust Pay Out Event" shall mean each event specified in subsection
9.01; provided, however, that with respect to any Series, if so specified in the
related Supplement, a Trust Pay Out Event may instead be a Reinvestment Event.
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"UCC" shall mean the Uniform Commercial Code, as amended from time
to time, as in effect in the State of Delaware or any other state or states
where the filing of a financing statement is required to perfect the Trust's
interest in the Receivables and the proceeds thereof or in any other specified
jurisdiction.
"United States" shall mean the United States of America (including
the States and the District of Columbia), its territories, its possessions and
other areas subject to its jurisdiction.
"Vice President" when used with respect to the Transferor or the
Servicer shall mean any vice president thereof whether or not designated by a
number or word or words added before or after the title "vice president."
"VISA" shall mean VISA USA, Inc.
Section 1.02. Other Definitional Provisions.
(a) With respect to any Series, all terms used herein and not
otherwise defined herein shall have meanings ascribed to them in the related
Supplement.
(b) All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein.
(c) As used in this Agreement and in any certificate or other
document made or delivered pursuant hereto or thereto, accounting terms not
defined in this Agreement or in any such certificate or other document, and
accounting terms partly defined in this Agreement or in any such certificate or
other document to the extent not defined, shall have the respective meanings
given to them under generally accepted accounting principles or regulatory
accounting principles, as applicable. To the extent that the definitions of
accounting terms in this Agreement or in any such certificate or other document
are inconsistent with the meanings of such terms under generally accepted
accounting principles or regulatory accounting principles, the definitions
contained in this Agreement or in any such certificate or other document shall
control.
(d) The agreements, representations and warranties of CC Credit Card
Corporation and Travelers Bank & Trust, fsb in this Agreement in each of their
respective capacities as Transferor and as Servicer, shall be deemed to be the
agreements, representations and warranties of CC Credit Card Corporation and
Travelers Bank & Trust, fsb solely in each such capacity for so long as CC
Credit Card Corporation and Travelers Bank & Trust, fsb act in each such
capacity under this Agreement. The agreements, representations and warranties of
Travelers Bank & Trust, fsb, in its individual capacity shall survive for so
long as Travelers Bank & Trust, fsb, is an Account Owner or any Receivables in
the Trust are Receivables that were transferred to the Transferor or the Trust
by Travelers Bank & Trust, fsb or in which Receivables Travelers Bank & Trust,
fsb granted a security interest to the Trustee.
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(e) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement; references to any
Section, Schedule or Exhibit are references to Sections, Schedules and Exhibits
in or to this Agreement unless otherwise specified; and the term "including"
means "including without limitation."
(f) Unless otherwise specifically provided herein, the failure of
this Agreement to specify the meaning of a term or the applicability of a
provision to any Series shall not preclude the meaning of such term or the
applicability of such provision with respect to such Series being set forth in
the Supplement therefor.
[END OF ARTICLE I]
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ARTICLE II
Conveyance of Receivables
Section 2.01. Conveyance of Receivables. By execution of this
Agreement, CC Credit Card Corporation as Transferor, does hereby transfer,
assign, set over and otherwise convey to the Trustee, on behalf of the Trust,
for the benefit of the Certificateholders, all its right, title and interest in,
to and under the Receivables existing at the close of business on the Initial
Cut-Off Date, in the case of Receivables arising in the Initial Accounts, and on
each Addition Cut-Off Date, in the case of Receivables arising in the Additional
Accounts, and in each case thereafter created from time to time until the
termination of the Trust, all monies due or to become due and all amounts
received with respect thereto (excluding, however, any and all Recoveries) and
all proceeds (including "proceeds" as defined in the UCC) thereof and any other
Trust Assets (as hereinafter defined). Such property, together with all monies
and other property on deposit in or credited to or held in the Collection
Account, the Excess Funding Account, the Series Accounts and any Series
Enhancement shall constitute the assets of the Trust (the "Trust Assets"). The
foregoing does not constitute and is not intended to result in the creation or
assumption by the Trust, the Trustee, any Investor Certificateholder or any
Series Enhancer of any obligation of Travelers Bank & Trust, fsb, The Travelers
Bank USA or other Account Owner, or the Servicer, the Transferor, any Additional
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, merchant clearance systems, VISA,
MasterCard or insurers. The foregoing transfer, assignment, set over and
conveyance to the Trust shall be made to the Trustee, on behalf of the Trust,
and each reference in this Agreement to such transfer, assignment set over and
conveyance shall be construed accordingly.
The 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 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 the Receivables to the Trust, and to deliver a
file stamped copy of each such financing statement or other evidence of such
filing (which may, for purposes of this Section 2.01, consist of telephone
confirmation of such filing) to the Trustee on or prior to the Initial Closing
Date, in the case of Receivables arising in the Initial Accounts, and (if any
additional filing is so necessary) the applicable Addition Date, in the case of
Receivables arising in Additional Accounts. The Trustee shall be under no
obligation whatsoever to file such financing or continuation statements or to
make any other filing under the UCC in connection with such sale and assignment.
The Transferor further agrees, at its own expense, (a) on or prior
to (x) the Initial Closing Date, in the case of the Initial Accounts, (y) the
applicable Addition Date, in the case of Additional Accounts, and (z) the
applicable Removal Date, in the case of Removed Accounts, to cause the Account
Owner to indicate in their respective computer files and the Transferor will
indicate in its records that Receivables created in connection with the Accounts
(other than Removed Accounts) have been conveyed to the Trust pursuant to this
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Agreement for the benefit of the Certificateholders (or conveyed to the
Transferor or its designee in the case of Removed Accounts) by including (or
deleting in the case of Removed Accounts) in such computer files the code "30"
or "31" or any other clearly specified code in the FDR Account Flagged field of
such computer files, and (b) on or prior to the Initial Closing Date, each
Addition Date and each Removal Date, as applicable, to deliver to the Trustee a
computer file or microfiche list containing a true and complete list of all such
Accounts specifying for each such Account, as of the Initial Cut-Off Date, in
the case of the Initial Accounts, the applicable Addition Cut-Off Date, in the
case of Additional Accounts, and the applicable Removal Cut-Off Date, in the
case of Removed Accounts, its account number, the aggregate amount outstanding
in such Account and the aggregate amount of Principal Receivables outstanding in
such Account. Such file or list, as supplemented from time to time to reflect
Additional Accounts and Removed Accounts, shall be marked as Schedule 1 to this
Agreement and is hereby incorporated into and made a part of this Agreement. The
Transferor agrees not to alter the code or field referenced in clause (a) above
with respect to any Account during the term of this Agreement unless and until
such Accounts become Removed Accounts or unless and until (i) the Transferor
shall give written notice of any such alteration to the Trustee, such written
notice to be as of the date of its receipt by the Trustee incorporated into and
made part of this Agreement, and (ii) the Trustee and the Transferor shall
execute and file any UCC financing statement or amendment thereof necessitated
by such alteration.
Section 2.02. Acceptance by Trustee.
(a) The Trustee hereby acknowledges its acceptance on behalf of the
Trust of all right, title and interest to the property, now existing and
hereafter created, conveyed to the Trust pursuant to Section 2.01 and declares
that it shall maintain such right, title and interest, upon the trust herein set
forth, for the benefit of all Certificateholders. The Trustee further
acknowledges that, prior to or simultaneously with the execution and delivery of
this Agreement, the Transferor delivered to the Trustee the computer file or
microfiche list relating to the Initial Accounts described in the last paragraph
of Section 2.01.
(b) The Trustee hereby agrees not to disclose to any Person (or to
any other department or operating division of the Trustee, other than the
corporate trust department of the Trustee or, if the Trustee shall be appointed
the Successor Servicer, such other departments or operating divisions of the
Trustee as shall be necessary to fulfill its duties as Servicer), any of the
account numbers or other information contained in the computer files or
microfiche lists marked as Schedule 1 or otherwise delivered to the Trustee from
time to time, except (i) to a Successor Servicer or as required by a Requirement
of Law applicable to the Trustee, (ii) in connection with the performance of the
Trustee's duties hereunder, (iii) in enforcing the rights of Certificateholders,
(iv) to bona fide creditors or potential creditors of any Account Owner, the
Servicer or any Transferor for the limited purpose of enabling any such creditor
to identify Receivables or Accounts subject to this Agreement or the Receivables
Transfer Agreements or (v) after consultation with the Transferor, as requested
by any Person in connection with the financing statements filed pursuant to this
Agreement. The Trustee also agrees not to use any of the foregoing information
for any purpose other than for the purposes provided for in this Agreement. The
Trustee agrees to take such measures as shall be reasonably requested by the
Transferor to protect and maintain the
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security and confidentiality of such information and, in connection therewith,
will allow the Transferor to inspect the Trustee's security and confidentiality
arrangements from time to time during normal business hours. The Trustee shall
provide the Transferor with notice five Business Days prior to any disclosure
pursuant to this subsection 2.02(b).
(c) The Trustee shall have no power to create, assume or incur
indebtedness or other liabilities in the name of the Trust other than as
contemplated in this Agreement or any Supplement.
Section 2.03. Representations and Warranties of Each Transferor
Relating to Such Transferor. Each Transferor hereby represents and warrants to
the Trust as of each Closing Date (but only if it was a Transferor on such date)
that:
(a) Organization and Good Standing. Such Transferor is a corporation
duly organized and validly existing in good standing under the laws of the
jurisdiction of its organization or incorporation, and has in all material
respects, full corporate power and authority to own or lease its properties and
conduct its business as such properties are presently owned or leased and such
business is presently conducted, to execute, deliver and perform its obligations
under this Agreement, any Receivables Transfer Agreement to which it is a party
and each applicable Supplement and to execute and deliver to the Trustee the
Certificates pursuant hereto.
(b) Due Qualification. Such 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 (i) render any Cardholder Agreement relating to an Account
specified in a Receivables Transfer Agreement with such Transferor or any
Receivable transferred to the Trust by such Transferor unenforceable by such
Transferor, the Servicer or the Trustee or (ii) would have a material adverse
effect on the interests of the Certificateholders hereunder or under any
Supplement; provided, however, that no representation or warranty is made with
respect to any qualification, licenses or approvals which the Trustee has or may
be required at any time to obtain, if any, in connection with the transactions
contemplated hereby.
(c) Due Authorization. The execution, delivery and performance of
this Agreement, each Receivables Transfer Agreement to which it is a party and
each Supplement by such Transferor and the execution and delivery to the Trustee
of the Certificates and the consummation by such Transferor of the transactions
provided for in this Agreement, each Receivables Transfer Agreement to which it
is a party and each Supplement have been duly authorized by such Transferor by
all necessary corporate action on the part of such Transferor and this
Agreement, each Receivables Transfer Agreement to which it is a party and each
Supplement will remain, from the time of its execution, an official record of
such Transferor.
(d) No Conflict. The execution and delivery by such Transferor of
this Agreement, each Receivables Transfer Agreement to which it is a party, each
Supplement and the Certificates, the performance by such Transferor of the
transactions contemplated by
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this Agreement, each Receivables Transfer Agreement to which it is a party and
each Supplement and the fulfillment by such Transferor of the terms hereof and
thereof applicable to such Transferor will not conflict with or violate any
Requirement of Law applicable to such Transferor or conflict with, result in any
breach of any of the material terms and provisions of, or constitute (with or
without notice or lapse of time or both) a material default under, any
indenture, contract, agreement, mortgage, deed of trust, or other instrument to
which such Transferor is a party or by which it or any of its properties are
bound.
(e) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of such Transferor, threatened against such
Transferor, before any court, regulatory body, administrative agency, or other
tribunal or governmental instrumentality (i) asserting the invalidity of this
Agreement, any Receivables Transfer Agreement to which it is a party, any
Supplement or the Certificates, (ii) seeking to prevent the issuance of the
Certificates or the consummation of any of the transactions contemplated by this
Agreement, any Receivables Transfer Agreement to which it is a party, any
Supplement or the Certificates, (iii) seeking any determination or ruling that,
in the reasonable judgment of such Transferor, would materially and adversely
affect the performance by such Transferor of its obligations under this
Agreement, any Receivables Transfer Agreement to which it is a party, or any
Supplement, (iv) seeking any determination or ruling that, in the reasonable
judgment of such Transferor, materially and adversely affect the validity or
enforceability of this Agreement, any Receivables Transfer Agreement to which it
is a party, any Supplement or the Certificates or (v) seeking to affect
adversely the income tax attributes of the Trust or any Certificates under the
United States Federal or any State income or franchise tax systems.
(f) All Consents Required. All approvals, authorizations, consents,
orders or other actions of any Person or of any governmental body or official
required to be obtained, effected or given by such Transferor in connection with
the execution and delivery by such Transferor of this Agreement, any Receivables
Transfer Agreement to which it is a party, each Supplement and the Certificates,
the performance by such Transferor of the transactions contemplated by this
Agreement, each Receivables Transfer Agreement to which it is a party and each
Supplement and the fulfillment by such Transferor of the terms hereof and
thereof, have been duly obtained, effected or given and are in full force and
effect except for approvals, authorizations, consents, orders or other actions
which if not obtained will not individually or in the aggregate have any
material adverse effect upon the ability of the Transferor to perform its
obligations hereunder; and provided, however, that such Transferor makes no
representation or warranty regarding state securities or "blue sky" laws in
connection with the distribution of the Certificates.
(g) Insolvency. No Insolvency Event with respect to such Transferor
has occurred and the transfer of the Receivables by such Transferor to the Trust
has not been made in contemplation of the occurrence thereof.
The representations and warranties of each Transferor set forth in
this Section 2.03 shall survive the transfer and assignment by such Transferor
of the respective Receivables to the Trust. Upon discovery by such Transferor,
the Servicer or the Trustee of
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a breach of any of the representations and warranties by such Transferor set
forth in this Section 2.03, the party discovering such breach shall give prompt
written notice to the others. Such Transferor agrees to cooperate with the
Servicer and the Trustee in attempting to cure any such breach. For purposes of
the representations and warranties set forth in this Section 2.03, each
reference to a Supplement shall be deemed to refer only to those Supplements in
effect as of the relevant Closing Date.
Section 2.04. Representations and Warranties of Each Transferor
Relating to the Agreement, the Receivables Transfer Agreements and Any
Supplement and the Receivables.
(a) Representations and Warranties. Each Transferor hereby
represents and warrants to the Trust as of each Closing Date and, with respect
to Additional Accounts the Receivables in which are being transferred by such
Transferor to the Trust, as of the related Addition Date (but only if, in either
case, it was a Transferor on such date) that:
(i) this Agreement, any Receivables Transfer Agreement
to which it is a party, each Supplement and, in the case of
Additional Accounts, the related Assignment, each constitutes a
legal, valid and binding obligation of such Transferor enforceable
against such Transferor in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect affecting the enforcement of creditors' rights generally from
time to time in effect or general principles of equity (whether
considered in a suit at law or in equity);
(ii) as of the Initial Cut-Off Date and as of the
related Addition Date with respect to Additional Accounts, the
portion of Schedule 1 to this Agreement under such Transferor's
name, as supplemented on such date, is an accurate and complete
listing in all material respects of all the Accounts the Receivables
in which were transferred by such Transferor as of the Initial
Cut-Off Date or such Addition Cut-Off Date, as the case may be, and
the information contained therein with respect to the identity of
such Accounts and the Receivables existing thereunder is true and
correct in all material respects as of the Initial Cut-Off Date or
such Addition Cut-Off Date, as the case may be;
(iii) each Receivable conveyed to the Trust by such
Transferor has been conveyed to the Trust free and clear of any Lien
of any Person claiming through or under such Transferor or any of
its Affiliates (other than Liens permitted under subsection 2.07(b))
and in compliance, in all material respects, with all Requirements
of Law applicable to such 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 such Transferor in
connection with the conveyance by such Transferor of Receivables to
the Trust have been duly
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obtained, effected or given and are in full force and effect except
for such authorizations, consents, orders or approvals of or
registrations or declarations with any Governmental Authority which
if not obtained, effected or given will not, individually or in the
aggregate, have any material adverse effect upon the Transferor's
conveyance of Receivables to the Trust or otherwise materially and
adversely affect the ability of the Transferor to perform its
obligations hereunder;
(v) either this Agreement or, in the case of Additional
Accounts, the related Assignment constitutes an absolute sale,
transfer and assignment to the Trust of all right, title and
interest of such Transferor in the Receivables conveyed to the Trust
by such Transferor and the proceeds thereof or, if this Agreement
or, in the case of Additional Accounts, the related Assignment does
not constitute an absolute sale of such property, it constitutes a
grant by such Transferor of a "security interest" (as defined in the
UCC) in such property to the Trust, which, in the case of existing
Receivables and the proceeds thereof, is enforceable upon execution
and delivery of this 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. Upon the filing of the financing statements pursuant to
Sections 2.01 and 2.09 and, in the case of Receivables hereafter
created and the proceeds thereof, upon the creation thereof, the
Trust shall have a first priority perfected security or ownership
interest in such property and proceeds except for (x) Liens
permitted under subsection 2.07(b), (y) the interests of the
Transferor as Holder of the Transferor Certificate or any
Supplemental Certificate, and (z) the Transferor's right, if any, to
interest accruing on and investment earnings, if any, in respect of
the Collection Account or any Series Account, as provided in this
Agreement or the related Supplement; provided, however, that such
Transferor makes no representation or warranty with respect to the
effect of Section 9-306 of the UCC on the rights of the Trustee to
proceeds held by such Transferor;
(vi) except as otherwise expressly provided in this
Agreement or any Supplement, neither such Transferor nor any Person
claiming through or under such Transferor has any claim to or
interest in the Collection Account, the Excess Funding Account, any
Series Account or any Series Enhancement;
(vii) on the Initial Cut-Off Date, each Initial Account
specified in Schedule 1 with respect to such Transferor is an
Eligible Account and, on the applicable Addition Cut-Off Date, each
related Additional Account specified in Schedule 1 with respect to
such Transferor is an Eligible Account;
(viii) on the Initial Cut-Off Date, each Receivable then
existing and conveyed to the Trust by such Transferor is an Eligible
Receivable and, on the applicable Addition Cut-Off Date, each
Receivable contained in any
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related Additional Account and conveyed to the Trust by such
Transferor is an Eligible Receivable;
(ix) as of the date of the creation of any new
Receivable in an Account specified in a Receivables Transfer
Agreement with such Transferor, such Receivable is an Eligible
Receivable; and
(x) no selection procedures believed by such Transferor
to be materially adverse to the interests of the Investor
Certificateholders have been used in selecting the Initial Accounts
or Additional Accounts.
(b) Notice of Breach. The representations and warranties of each
Transferor set forth in this Section 2.04 shall survive the transfer and
assignment by such Transferor of Receivables to the Trust. Upon discovery by
such Transferor, the Servicer or the Trustee of a breach of any of the
representations and warranties by such Transferor set forth in this Section
2.04, the party discovering such breach shall give prompt written notice to the
others. Such Transferor agrees to cooperate with the Servicer and the Trustee in
attempting to cure any such breach. For purposes of the representations and
warranties set forth in this Section 2.04, each reference to a Supplement shall
be deemed to refer only to those Supplements in effect as of the date of the
relevant representations or warranties.
Section 2.05. Reassignment of Ineligible Receivables.
(a) Reassignment of Receivables. In the event (i) any representation
or warranty contained in subsection 2.04(a)(ii), (iii), (iv), (vii), (viii),
(ix) or (x) is not true and correct in any material respect as of the date
specified therein with respect to any Account or the related Receivables
transferred to the Trust by such Transferor 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 the Trustee) after the earlier to
occur of the discovery thereof by such Transferor or receipt by such Transferor
of notice thereof given by the Trustee, or (ii) it is so provided in subsection
2.07(a) with respect to any Receivables transferred to the Trust by such
Transferor, then such Transferor shall accept reassignment of all Receivables in
the related Account ("Ineligible Receivables") on the terms and conditions set
forth in paragraph (b) below; provided, however, that such Receivables will not
be deemed to be Ineligible Receivables and will not be reassigned to such
Transferor 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) above the relevant
representation and warranty shall be true and correct in all material respects
as if made on such day or (B) in the case of an event described in clause (ii)
above the circumstances causing such Receivable to become an Ineligible
Receivable shall no longer exist and (y) such Transferor shall have delivered to
the Trustee an Officer's Certificate describing the nature of such breach and
the manner in which the relevant representation and warranty became true and
correct. The Transferor will notify the Rating Agencies of any such breach that
is not cured within the time periods specified above.
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(b) Price of Reassignment. The Servicer shall deduct the portion of
the Ineligible Receivables reassigned to each Transferor which are Principal
Receivables from the aggregate amount of Principal Receivables used to calculate
the Transferor Amount, the Series Percentages and any other percentage used to
allocate within or among Series that is applicable to any Series. In the event
that, following the exclusion of such Principal Receivables from the calculation
of the Transferor Amount, the Transferor Amount would be less than the Required
Transferor Amount, not later than 12:00 noon, New York City time, on the first
Distribution Date following the Monthly Period in which such reassignment
obligation arises, the relevant 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 reduced below the Required Transferor
Amount (up to the amount of such Principal Receivables).
Upon the deposit, if any, required to be made to the Excess Funding
Account as provided in this Section and the reassignment of Ineligible
Receivables, the Trustee, on behalf of the Trust, shall automatically and
without further action be deemed to transfer, assign, set over and otherwise
convey to the relevant Transferor or its designee, without recourse,
representation or warranty, all the right, title and interest of the Trust in
and to such Ineligible Receivables, all monies due or to become due and all
amounts received with respect thereto and all proceeds thereof. The Trustee
shall execute such documents and instruments of transfer or assignment and take
such other actions as shall reasonably be requested by the relevant Transferor
to effect the conveyance of Ineligible Receivables pursuant to this Section. The
obligation of each Transferor to accept reassignment of any Ineligible
Receivables, and to make the deposits, if any, required to be made to the Excess
Funding Account as provided in this Section, shall constitute the sole remedy
respecting the event giving rise to such obligation available to
Certificateholders (or the Trustee on behalf of the Certificateholders).
Section 2.06. Reassignment of Receivables in Trust Portfolio. In the
event any representation or warranty of a Transferor set forth in subsection
2.03(a) or (c) or subsection 2.04(a)(i), (v) or (vi) is not true and correct in
any material respect and such breach has a material adverse effect on the
Certificateholders' Interest in the Receivables transferred to the Trust by such
Transferor, then either the Trustee or the Holders of Investor Certificates
evidencing more than 50% of the Aggregate Investor Amount, by notice then given
to such Transferor and the Servicer (and to the Trustee if given by the Investor
Certificateholders), may direct such Transferor to accept a reassignment of the
Receivables transferred to the Trust by such Transferor if such breach and any
material adverse effect caused by such breach is not cured within 60 days of
such notice (or within such longer period, not in excess of 150 days, as may be
specified in such notice), and upon those conditions such Transferor shall be
obligated to accept such reassignment on the terms set forth below; provided,
however, that such Receivables will not be reassigned to such Transferor if, on
any day prior to the end of such 60-day or longer period (i) the relevant
representation and warranty shall be true and correct in all material respects
as if made on such day and (ii) such Transferor shall have delivered to the
Trustee a certificate of an authorized officer describing the nature of such
breach and the manner in which the relevant representation and warranty became
true and correct. The Transferor will notify the Rating Agencies of any such
breach that is not cured within the time periods specified above.
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The relevant 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 the terms of each
Supplement.
Upon the deposit, if any, required to be made to the Collection
Account as provided in this Section and the reassignment of the Receivables, the
Trustee, on behalf of the Trust, shall automatically and without further action
be deemed to transfer, assign, set over and otherwise convey to the relevant
Transferor or its designee, without recourse, representation or warranty, all
the right, title and interest of the Trust in and to such Receivables, all
monies due or to become due and all amounts received with respect thereto and
all proceeds thereof. The Trustee shall execute such documents and instruments
of transfer or assignment and take such other actions as shall reasonably be
requested by the relevant Transferor to effect the conveyance of such
Receivables pursuant to this Section. The obligation of each 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 Certificateholders (or the Trustee on behalf of the
Certificateholders) or any Series Enhancer.
Section 2.07. Covenants of the Transferor. Each Transferor hereby
covenants as follows:
(a) Receivables to be Accounts or General Intangibles. Except in
connection with the enforcement or collection of a Receivable, such Transferor
will take no action to cause any Receivable transferred by it to the Trust to be
evidenced by any instrument or chattel paper (as defined in the UCC) and, if any
such Receivable is so evidenced, it shall be deemed to be an Ineligible
Receivable in accordance with subsection 2.05(a) and shall be reassigned to such
Transferor in accordance with subsection 2.05(b); provided, however, that
Receivables evidenced by notes taken from Obligors in the ordinary course of
business of the Servicer's collection efforts shall not be deemed Ineligible
Receivables solely as a result thereof.
(b) Security Interests. Except for the conveyances hereunder, such
Transferor will not sell, pledge, assign or transfer to any other Person, or
grant, create, incur, assume or suffer to exist any Lien on any Receivable
transferred by it to the Trust, whether now existing or hereafter created, or
any interest therein; such Transferor will immediately notify the Trustee of the
existence of any Lien on any such Receivable; and such Transferor shall defend
the right, title and interest of the Trust in, to and under such Receivables,
whether now existing or hereafter created, against all claims of third parties
claiming through or under such Transferor; provided, however, that nothing in
this subsection 2.07(b) shall prevent or be deemed to prohibit such Transferor
from suffering to exist upon any of the Receivables transferred by it to the
Trust any Liens for municipal or other local taxes if such taxes shall not at
the time be due and payable or if such Transferor
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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) Transferor's Interest. Except for the conveyances hereunder, in
connection with any transaction permitted by Section 7.02 and as provided in
Sections 2.09(e) and 6.03, such Transferor agrees not to transfer, assign,
exchange or otherwise convey or pledge, hypothecate or otherwise grant a
security interest in the Transferor's Interest represented by the Transferor
Certificate or any Supplemental Certificate and any such attempted transfer,
assignment, exchange, conveyance, pledge, hypothecation or grant shall be void.
(d) Delivery of Collections. In the event that such Transferor
receives Collections, such Transferor agrees to pay the Servicer all such
Collections as soon as practicable after receipt thereof but in no event later
than two Business Days after the Date of Processing by the Transferor.
(e) Notice of Liens. Such Transferor shall notify the Trustee
promptly after becoming aware of any Lien on any Receivable other than the
conveyances hereunder and under the Receivables Transfer Agreements or Liens
permitted under subsection 2.07(b).
(f) Amendment of the Certificate of Incorporation. Such Transferor
will not amend in any material respect its Certificate of Incorporation without
providing the Rating Agency 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.
(g) Other Indebtedness. Such Transferor shall not incur any
additional debt, unless (i) such debt is incurred pursuant to the Revolving
Credit Agreement or (ii) the Rating Agency is provided with notice no later than
the fifth Business Day prior to the incurrence of such additional debt (unless
the right to such notice is waived by the Rating Agency) and the Rating Agency
Condition is satisfied with respect to the incurrence of such debt.
(h) Separate Corporate Existence. Such Transferor shall:
(i) Maintain in full effect its existence, rights and
franchises as a corporation under the laws of the state of its
incorporation and will obtain and preserve its qualification to do
business in each jurisdiction in which such qualification is or
shall be necessary to protect the validity and enforceability of
this Agreement and any Receivables Transfer Agreement to which it is
a party and each other instrument or agreement necessary or
appropriate to proper administration hereof and permit and
effectuate the transactions contemplated hereby.
(ii) Maintain its own bank or securities account or
accounts, separate from those of any Affiliate of such Transferor,
with commercial financial institutions. The funds and other property
of such Transferor will not be diverted to any other Person or for
other than the corporate use of such
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Transferor, and, except as may be expressly permitted by this
Agreement or any Receivables Transfer Agreement to which it is a
party, the funds and other property of such Transferor shall not be
commingled with those of any Affiliate of such Transferor.
(iii) Ensure that, to the extent that it shares the same
officers or other employees as any of its stockholders or
Affiliates, the salaries of and the expenses related to providing
benefits to such officers and other employees shall be fairly
allocated among such entities, and each such entity shall bear its
fair share of the salary and benefit costs associated with all such
common officers and employees.
(iv) Ensure that, to the extent that it jointly
contracts with any of its stockholders or Affiliates to do business
with vendors or service providers or to share overhead expenses, the
costs incurred in so doing shall be allocated fairly among such
entities, and each such entity shall bear its fair share of such
costs. To the extent that such Transferor contracts or does business
with vendors or service providers where the goods and services
provided are partially for the benefit of any other Person, the
costs incurred in so doing shall be fairly allocated to or among
such entities for whose benefit the goods and services are provided,
and each such entity shall bear its fair share of such costs. All
material transactions between such Transferor and any of its
Affiliates shall be only on an arm's-length basis and shall receive
the approval of such 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 such Transferor and any of its stockholders or
Affiliates have offices in contiguous space, there shall be fair and
appropriate allocation of overhead costs among them, and each such
entity shall bear its fair share of such expenses.
(vi) Conduct its affairs strictly in accordance with its
Certificate of Incorporation and observe all necessary, appropriate
and customary corporate formalities, including, but not limited to,
holding all regular and special stockholders' and directors'
meetings appropriate to authorize all corporate action, keeping
separate and accurate minutes of such meetings, passing all
resolutions or consents necessary to authorize actions taken or to
be taken, and maintaining accurate and separate books, records and
accounts, including, but not limited to, payroll and intercompany
transaction accounts. Regular stockholders' and directors' meetings
shall be held at least annually.
(vii) Ensure that its Board of Directors shall at all
times include at least one Independent Director on the Initial
Closing date and, within 30 days of the Initial Closing Date and at
all times thereafter, two
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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 during the preceding five years
been (x) a director, officer, consultant, agent, employee, affiliate
or shareholder of any Affiliate of such Transferor or any affiliate
or subsidiary thereof, or of any major creditor thereof, and who is
not the beneficial owner, at the time of such individual's
appointment as an Independent Director, of more than 1,000 shares in
the aggregate of all classes of common stock of an Affiliate of such
Transferor, or if greater, such number of shares the value of which
constitutes no more than 10% of such individual's net worth or (y) a
member of the immediate family of any of the foregoing).
(viii) Ensure that decisions with respect to its
business and daily operations shall be independently made by such
Transferor (although the officer making any particular decision may
also be an officer or director of an Affiliate of such Transferor)
and shall not be dictated by an Affiliate of such Transferor.
(ix) Act solely in its own corporate name and through
its own authorized officers and agents, and no Affiliate of such
Transferor shall be appointed to act as agent of such Transferor,
except as expressly contemplated by this Agreement or any
Receivables Transfer Agreement to which it is a party. The
Transferor shall at all times use its own stationery.
(x) Other than as provided in the Revolving Credit
Agreement, ensure that no Affiliate of such Transferor shall advance
funds to such Transferor, and no Affiliate of such Transferor will
otherwise guaranty debts of, such Transferor; provided, however,
that an Affiliate of such Transferor may provide funds to such
Transferor in connection with the capitalization of such Transferor,
including capital necessary to assure that such Transferor has
"substantial assets" as described in Treasury Regulation Section
301.7701- 2(d)(2) as in effect on December 16, 1996 prior to
amendment by Treasury Decision 8697.
(xi) Other than organizational expenses and as expressly
provided herein, pay all expenses, indebtedness and other
obligations incurred by it.
(xii) Not enter into any guaranty, or otherwise become
liable, with respect to any obligation of any Affiliate of such
Transferor nor shall such Transferor make any loans to any Person.
(xiii) Ensure that any financial reports required of
such Transferor shall be issued separately from, but may be
consolidated with, any reports prepared for any of its Affiliates.
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(xiv) Ensure that at all times it is adequately
capitalized to engage in the transactions contemplated in its
Certificate of Incorporation.
Section 2.08. Covenants of Each Transferor with Respect to
Receivables Transfer Agreements. Each Transferor hereby covenants that it will
at all times enforce the covenants and agreements of the Account Owners under
the terms of the Receivables Transfer Agreements to which it is a party,
including covenants to the effect set forth below:
(a) Periodic Finance Charges and Other Fees. (i) Except (x) as
otherwise required by any Requirements of Law, or (y) as is deemed by the
Account Owner to be necessary in order for it to maintain its credit card
business on a competitive basis based on a good faith assessment by it of the
nature of its competition in the credit card business, it shall not at any time
reduce the annual percentage rate of the Periodic Finance Charges assessed on
the Receivables transferred by it to the Transferor or other fees charged on any
of the Accounts owned by it if, as a result of any such reduction, either (i)
such Account Owner's reasonable expectation is that such reduction will cause a
Pay Out Event or Reinvestment Event to occur or (ii) such reduction is not also
applied to any comparable segments of consumer revolving credit card accounts
owned by such Account Owner which have characteristics the same as, or
substantially similar to, such Accounts.
(b) Cardholder Agreements and Credit Card Guidelines. Such Account
Owner shall comply with and perform its obligations under the Cardholder
Agreements relating to the Accounts owned by it and the Credit Card Guidelines
and all applicable rules and regulations of MasterCard and VISA or their
respective substantial equivalents except insofar as any failure so to comply or
perform would not materially and adversely affect the rights of the Trust or the
Certificateholders hereunder. Subject to compliance with all Requirements of
Law, such Account Owner may change the terms and provisions of the Cardholder
Agreements or the Credit Card Guidelines with respect to any of the Accounts
owned by it in any respect (including the calculation of the amount or the
timing, of charge-offs and the Periodic Finance Charges and other fees to be
assessed thereon) only if in the reasonable judgment of such Account Owner such
change is made applicable to any comparable segment of the consumer revolving
credit card accounts owned by such Account Owner which have characteristics the
same as, or substantially similar to, such Accounts.
(c) MasterCard and VISA. Such Account Owner, to the extent
applicable to Accounts owned or serviced by such Account Owner, shall use its
best efforts to remain, either directly or indirectly, a member in good standing
of the MasterCard system, the VISA system and any other similar entity's or
organization's system relating to any other type of consumer revolving credit
card accounts included as Accounts.
Each Transferor further covenants that it will not enter into any
amendments to a Receivables Transfer Agreement or enter into a new Receivables
Transfer Agreement unless the Rating Agency Condition has been satisfied.
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Section 2.09. Addition of Accounts.
(a) Additional Accounts. (i) Required Additions. If on
any Determination Date, as of the close of business on the last
Business Day of the preceding Monthly Period, either (x) the
Transferor Amount is less than the Required Transferor Amount or (y)
an amount equal to the product of (A) the aggregate amount of
Principal Receivables and (B) one minus the Discount Percentage is
less than the Required Principal Balance, the Transferor shall on or
prior to the close of business on the 10th Business Day following
such Determination Date (the "Required Designation Date"), unless
the Transferor Amount exceeds the Required Transferor Amount and the
product of (A) the aggregate amount of Principal Receivables and (B)
one minus the Discount Percentage exceeds the Required Principal
Balance, as the case may be, in either case as of the close of
business on any day after the last Business Day of such Monthly
Period and prior to the Required Designation Date, cause to be
designated additional Eligible Accounts to be included as Accounts
as of the Required Designation Date or any earlier date in a
sufficient amount such that, after giving effect to such addition,
the Transferor Amount as of the close of business on the applicable
Addition Date is at least equal to the Required Transferor Amount on
such date and the product of (A) the aggregate amount of Principal
Receivables and (B) one minus the Discount Percentage exceeds the
Required Principal Balance on such date. The failure of any
condition set forth in paragraph (c) below, as the case may be,
shall not relieve the Transferor of its obligation pursuant to this
paragraph; provided, however, that the failure of the Transferor to
transfer Receivables to the Trust as provided in this clause (i)
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 may nevertheless result in the occurrence of a Pay
Out Event or Reimbursement Event.
(ii) Optional Participation Interests. In lieu of, or in
addition to, designating Additional Accounts pursuant to clause (i)
above, the Transferor may, subject to the conditions specified in
paragraph (c) below, convey to the Trust participations (including
100% participations) representing undivided interests in a pool of
assets primarily consisting of revolving credit card receivables and
any interests in any of the foregoing, including securities
representing or backed by such receivables and collections thereon
("Participation Interests"). The addition of Participation Interests
in the Trust pursuant to this paragraph (a) or paragraph (b) below
shall be effected by a Participation Interest Supplement, dated the
applicable Addition Date and entered into pursuant to subsection
13.01(a).
(b) Restricted Additions. Each Transferor may from time to time, at
its sole discretion, subject to the conditions specified below, designate
additional Eligible Accounts to be included as Accounts or Participation
Interests to be included as Trust Assets, in either case as of the applicable
Addition Date.
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(c) Conditions to Required Additions, Optional Participation
Interests and Restricted Additions. On the Addition Date with respect to any
Additional Accounts or Participation Interests designated pursuant to subsection
2.09(a) or (b), the Transferor shall transfer the Receivables in such Additional
Accounts (and such Additional Accounts shall be deemed to be Accounts for
purposes of this Agreement) or shall transfer such Participation Interests, in
each case as of the close of business on the applicable Addition Date, subject
to the satisfaction of the following conditions:
(i) on or before the tenth Business Day immediately
preceding the Addition Date, each Transferor which owns any such
Additional Account or is transferring any such Participation
Interest to the Trust (a "Participating Transferor") shall have
given the Trustee and each Rating Agency written notice that the
Additional Accounts or Participation Interests will be included and
specifying the applicable Addition Date, the Addition Cut-Off Date,
and the approximate number of accounts expected to be added and the
approximate aggregate balances expected to be outstanding in the
accounts to be added (in the case of Additional Accounts);
(ii) in the case of Additional Accounts, the
Participating Transferor shall have delivered to the Trustee copies
of UCC-1 financing statements covering such Additional Accounts, if
necessary to perfect the Trust's interest in the Receivables arising
therein;
(iii) as of each of the Addition Cut-Off Date and the
Addition Date, no Insolvency Event with respect to the Participating
Transferor or the Account Owner of the Additional Accounts shall
have occurred nor shall the transfer of the Receivables arising in
the Additional Accounts or of the Participation Interests to the
Trust have been made in contemplation of the occurrence thereof;
(iv) except in the case of an Addition pursuant to
subsection 2.09(a)(i), the Rating Agency Condition shall have been
satisfied;
(v) each Participating Transferor shall have delivered
to the Trustee an Officer's Certificate, dated the Addition Date,
stating that (x) in the case of Additional Accounts, as of the
applicable Addition Cut-Off Date, the Additional Accounts are all
Eligible Accounts, (y) to the extent applicable, the conditions set
forth in clauses (ii) through (iv) above and (viii) below have been
satisfied and (z) such Participating Transferor reasonably believes
that the addition by such Participating Transferor of the
Receivables arising in the Additional Accounts or of the
Participation Interests to the Trust will not, based on the facts
known to such officer at the time of such addition, then or
thereafter cause a Pay Out Event or Reinvestment Event to occur with
respect to any Series;
(vi) the Participating Transferors shall have delivered
to the Trustee and each Rating Agency an Opinion of Counsel, which
counsel shall
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be outside counsel, dated the Addition Date, in accordance with
subsection 13.02(d);
(vii) in the case of designation of Additional Accounts,
Participating Transferors shall have delivered to the Trustee (x)
the computer file or microfiche list required to be delivered
pursuant to Section 2.01 with respect to such Additional Accounts
and (y) a duly executed, written assignment (including an acceptance
by the Trustee for the benefit of the Certificateholders),
substantially in the form of Exhibit B (the "Assignment"); and
(viii) unless each Rating Agency otherwise consents, the
number of Additional Accounts designated pursuant to subsection
2.09(a) with respect to any of the three consecutive Monthly Periods
commencing in January, April, July and October of each calendar
year, commencing in January 1998, shall not exceed 15% of the number
of Accounts as of the first day of the calendar year during which
such Monthly Periods commence and the number of Additional Accounts
designated pursuant to subsection 2.09(a) during any calendar year
shall not exceed 20% of the number of Accounts as of the first day
of such calendar year.
(d) Automatic Account Additions.
(i) Each Transferor may from time to time, at its sole
discretion, subject to and in compliance with the limitations
specified in clause (ii) below and the applicable conditions
specified in clauses (iii) through (vii) below, designate Eligible
Accounts ("Automatic Additional Accounts") to be included as
Accounts as of the applicable Addition Date. For purposes of this
paragraph, Eligible Accounts shall be deemed to include only
consumer revolving credit card accounts of the same nature as those
included as Initial Accounts.
(ii) Unless each Rating Agency otherwise consents, the
number of Automatic Additional Accounts designated with respect to
any of the three consecutive Monthly Periods commencing in January,
April, July and October of each calendar year, commencing in January
1998, shall not exceed 15% of the number of Accounts as of the first
day of the calendar year during which such Monthly Periods commence
and the number of Automatic Additional Accounts designated during
any such calendar year shall not exceed 20% of the number of
Accounts as of the first day of such calendar year.
(iii) Within 30 days after the Addition Date with
respect to any Automatic Additional Accounts, the relevant
Transferor shall have delivered to the Trustee and each Rating
Agency an Opinion of Counsel (which counsel shall be outside
counsel) in accordance with subsection 13.02(d), with respect to the
Automatic Additional Accounts included as Accounts on such Addition
Date, confirming the validity and perfection of the transfer of such
Automatic
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Additional Accounts. If such Opinion of Counsel with respect to any
Automatic Additional Accounts is not so received, the ability of
such Transferor to designate Automatic Additional Accounts will be
suspended until such time as each Rating Agency otherwise consents
in writing. If such Transferor is unable to deliver an Opinion of
Counsel with respect to any Automatic Additional Account, such
inability shall be deemed to be a breach of the representation in
subsection 2.04(a)(viii) with respect to the Receivables in such
Automatic Additional Account for purposes of Section 2.05; provided,
that the cure period for such breach shall not exceed 30 days.
(iv) Each Participating Transferor shall have delivered
to the Trustee copies of UCC-1 financing statements covering such
Automatic Additional Accounts, if necessary to perfect the Trust's
interest in the Receivables arising therein.
(v) As of each of the Addition Cut-Off Date and the
Addition Date, no Insolvency Event with respect to any Participating
Transferor or the Account Owner of the Additional Accounts shall
have occurred nor shall the transfer of the Receivables arising in
the Automatic Additional Accounts to the Trust have been made in
contemplation of the occurrence thereof.
(vi) Each Participating Transferor shall have delivered
to the Trustee an Officer's Certificate, dated the Addition Date,
stating that (x) as of the applicable Addition Cut-Off Date, such
Automatic Additional Accounts are all Eligible Accounts, (y) to the
extent applicable, the conditions set forth in clauses (ii) through
(v) above have been satisfied and (z) such Participating Transferor
reasonably believes that the addition by such Participating
Transferor of the Receivables arising in such Automatic Additional
Accounts will not, based on the facts known to such officer at the
time of such addition, then or thereafter cause a Pay Out Event to
occur with respect to any Series.
(vii) The Participating Transferor shall have delivered
to the Trustee (x) the computer file or microfiche list required to
be delivered pursuant to Section 2.01 with respect to such Automatic
Additional Accounts and (y) a duly executed Assignment.
(e) Additional Transferors. The Transferor may designate Affiliates
of Commercial Credit Company to be included as Transferors ("Additional
Transferors") under this Agreement by an amendment hereto pursuant to subsection
13.01(a) and, in connection with such designation, the Transferor shall
surrender the Transferor Certificate to the Trustee in exchange for a newly
issued Transferor Certificate modified to reflect such Additional Transferor's
interest in the Transferor's Interest; provided, however, that prior to any such
designation and exchange the conditions set forth in subsection 6.03(c) or
6.03(d), as applicable, shall have been satisfied with respect thereto.
Section 2.10. Removal of Accounts and Participation Interests. On
any day of any Monthly Period each Transferor shall have the right to designate
certain Accounts to
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be removed as Accounts and 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 in such Removed Accounts, all monies due or to
become due and all amounts received with respect thereto and all proceeds
thereof in or with respect to such Accounts. The Accounts specified for removal
(the "Removed Accounts") by a Transferor shall be set forth in a Receivables
Transfer Agreement with such Transferor. The removal of Accounts and of
Participation Interests are subject to the satisfaction of the following
conditions:
(a) on or before the fifth Business Day immediately preceding the
Removal Date (the "Removal Notice Date"), such Transferor shall have given the
Trustee, the Servicer, each Rating Agency and any Series Enhancer written notice
of such removal, specifying the date for removal of the Removed Accounts or
Participation Interests (the "Removal Date");
(b) with respect to Removed Accounts, on or prior to the Removal
Date, such Transferor shall have amended Schedule 1 by delivering to the Trustee
a computer file or microfiche list containing a true and complete list of the
Removed Accounts specifying for each such Account, as of the last day of the
Monthly Period preceding the Removal Notice Date (the "Removal Cut-Off Date"),
its account number, the aggregate amount outstanding in such Account and the
aggregate amount of Principal Receivables outstanding in such Account;
(c) with respect to Removed Accounts, such Transferor shall have
represented and warranted as of the Removal Date that the list of Removed
Accounts delivered pursuant to paragraph (b) above, as of the Removal Cut-Off
Date, is true and complete in all material respects;
(d) the Rating Agency Condition shall have been satisfied with
respect to such removal;
(e) such Transferor shall have delivered to the Trustee an Officer's
Certificate, dated the Removal Date, to the effect that such Transferor
reasonably believes that (i) such removal will not, based on the facts known to
such officer at the time of such certification, then or thereafter cause a Pay
Out Event or Reinvestment Event to occur with respect to any Series, (ii) no
selection procedure believed by such Transferor to be materially adverse to the
interests of the Investor Certificateholders of any Series as of the Removal
Date have been used in selecting the Removed Accounts or Participation Interests
and (iii) to the extent applicable, the conditions set forth in subsections (c),
(d) and (f) of this Section 2.10 have been satisfied; and
(f) as of the Removal Cut-Off Date, no more than 10% of the
Receivables outstanding are more than thirty days Contractually Delinquent.
Upon satisfaction of the above conditions, the Trustee shall execute
and deliver to the relevant Transferor or its designee a written reassignment in
substantially the form of Exhibit C (the "Reassignment") and shall, without
further action, be deemed to transfer, assign, set over and otherwise convey to
such Transferor or its designee, effective
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as of the Removal Date, without recourse, representation or warranty, all the
right, title and interest of the Trust in and to the Participation Interests or
Receivables arising in the Removed Accounts, all monies due and to become due
and all amounts received with respect thereto and all proceeds thereof. In
addition, the Trustee shall execute such other documents and instruments of
transfer or assignment and take such other actions as shall reasonably be
requested by the relevant Transferor to effect the conveyance of Participation
Interests or Receivables pursuant to this Section 2.10.
Section 2.11. Account Allocations. In the event that any 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 9.02 or any order of any Governmental Authority (a
"Transfer Restriction Event"), then, in any such event, (a) such Transferor and
the Servicer agree (except as prohibited by any such order) to allocate and pay
to the Trust, after the date of such inability, all Collections of Receivables
transferred to the Trust by such Transferor, including Collections of
Receivables transferred to the Trust by such Transferor prior to the occurrence
of such event, and all amounts which would have constituted Collections but for
such Transferor's inability to transfer Receivables (up to an aggregate amount
equal to the amount of Receivables transferred to the Trust by such Transferor
in the Trust on such date), (b) such Transferor and the Servicer agree that such
amounts will be applied as Collections in accordance with Article IV and the
terms of each Supplement and (c) for so long as the allocation and application
of all Collections and all amounts that would have constituted Collections are
made in accordance with clauses (a) and (b) above, Principal Receivables and all
amounts which would have constituted Principal Receivables but for such
Transferor's inability to transfer Receivables to the Trust which are written
off as uncollectible in accordance with this Agreement shall continue to be
allocated in accordance with Article IV and the terms of each Supplement. For
the purpose of the immediately preceding sentence, such Transferor and the
Servicer shall treat the first received Collections with respect to the Accounts
as allocable to the Trust until the Trust shall have been allocated and paid
Collections in an amount equal to the aggregate amount of Principal Receivables
in the Trust as of the date of the occurrence of such event. If such Transferor
or the Servicer is unable pursuant to any Requirements of Law to allocate
Collections as described above, such Transferor and the Servicer agree that,
after the occurrence of such event, payments on each Account with respect to the
principal balance of such Account shall be allocated first to the oldest
principal balance of such Account and shall have such payments applied as
Collections in accordance with Article IV and the terms of each Supplement. The
parties hereto agree that Finance Charge Receivables, whenever created, accrued
in respect of Principal Receivables which have been conveyed to the Trust shall
continue to be a part of the Trust notwithstanding any cessation of the transfer
of additional Principal Receivables to the Trust and Collections with respect
thereto shall continue to be allocated and paid in accordance with Article IV
and the terms of each Supplement.
Section 2.12. Discount Option.
(a) A percentage (the "Discount Percentage") (which on the Initial
Closing Date shall be 1.50%) of Collections of Principal Receivables shall be
treated as Collections of Finance Charge Receivables ("Discount Option
Collections"). Subject to the conditions
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specified below, the Transferor may, without notice to or the consent of any
Investor Certificateholder, from time to time, increase, reduce or eliminate the
Discount Percentage for all or any specified portion of Collections of Principal
Receivables on or after a specified date (each, a "Discount Option Date"). The
Transferor shall provide 30 days prior written notice of any such change in the
Discount Percentage and the related Discount Option Date to the Trustee and each
Rating Agency and such change in the Discount Percentage shall become effective
on such Discount Option Date only if, on or prior to such Discount Option Date,
(i) the Transferor delivers to the Trustee an Officer's Certificate to the
effect that, in the reasonable belief of the Transferor based on the facts known
to the Transferor at such time, such change in the Discount Percentage would not
cause a Pay Out Event or Reinvestment Event with respect to any Series to occur,
or an event that, with notice or the lapse of time or both, would constitute a
Pay Out Event or Reinvestment Event with respect to any Series and (ii) the
Rating Agency Condition is satisfied.
(b) On each Date of Processing, Discount Option Collections, if any,
shall be treated as Collections of Finance Charge Receivables.
Section 2.13. Security Interest Granted by Travelers Bank & Trust,
fsb. To the extent that any transfer of Receivables or other property by
Travelers Bank & Trust, fsb pursuant to a Receivables Transfer Agreement is
determined to be other than an absolute assignment of such Receivables or other
property, then Travelers Bank & Trust, fsb, in its individual capacity, hereby
grants to the Trustee on behalf of the Trust, for the benefit of the
Certificateholders, a security interest in and to all of its right, title, and
interest, in, to and under (i) the Receivables existing at the close of business
on the Initial Cut-Off Date and in the case of Receivables arising in the
Initial Accounts owned by Travelers Bank & Trust, fsb and on each Addition
Cut-Off Date in the case of Receivables arising in the Additional Accounts,
owned by Travelers Bank & Trust, fsb, and in each case, thereafter created from
time to time until the termination of the Trust, and (ii) all monies due or to
become due and all amounts received with respect thereto (excluding, however,
any and all Recoveries) and all proceeds (including "proceeds" as such term is
defined in the UCC) thereof. With respect to the foregoing collateral, the
Trustee shall have all of the rights the Trustee has hereunder and under the
Receivables Transfer Agreements. Travelers Bank & Trust, fsb, agrees to indicate
in its computer files and Traveler's Bank & Trust, fsb's records that a security
interest in such Receivables created in connection with such Accounts has been
granted to the Trust pursuant to this Agreement for the benefit of the
Certificateholders by including in such computer files the code "30" or "31" or
any other clearly specified code in the FDR Account Flagged field of such
computer files. This Section 2.13 shall constitute a security agreement between
Travelers Bank & Trust, fsb and the Trustee, on behalf of the Trust.
[END OF ARTICLE II]
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ARTICLE III
Administration and Servicing
of Receivables
Section 3.01. Acceptance of Appointment and Other Matters Relating
to the Servicer.
(a) Travelers Bank & Trust, fsb agrees to act as the Servicer under
this Agreement and the Certificateholders by their acceptance of Certificates
consent to Travelers Bank & Trust, fsb acting as Servicer.
(b) The Servicer shall service and administer the Receivables, shall
collect payments due under the Receivables and shall charge off as uncollectible
Receivables, all in accordance with its customary and usual servicing procedures
for servicing credit card receivables comparable to the Receivables and in
accordance with the Credit Card Guidelines. The Servicer shall have full power
and authority, acting alone or through any party properly designated by it
hereunder, to do any and all things in connection with such servicing and
administration which it may deem necessary or desirable. Without limiting the
generality of the foregoing, subject to Section 10.01 and provided Travelers
Bank & Trust, fsb is the Servicer, the Servicer or its designee (rather than the
Trustee) is hereby authorized and empowered (i) to make withdrawals and payments
or to instruct the Trustee to make withdrawals and payments from the Collection
Account, the Excess Funding Account and any Series Account, as set forth in this
Agreement or any Supplement, and (ii) to take any action required or permitted
under any Series Enhancement, as set forth in this Agreement or any Supplement.
Without limiting the generality of the foregoing and subject to Section 10.01,
the Servicer or its designee is hereby authorized and empowered to make any
filings, reports, notices, applications and registrations with, and to seek any
consents or authorizations from, the Commission and any state securities
authority on behalf of the Trust as may be necessary or advisable to comply with
any Federal or state securities laws or reporting requirements. The Trustee
shall furnish the Servicer with any powers of attorney or other documents
necessary or appropriate to enable the Servicer to carry out its servicing and
administrative duties hereunder.
(c) The Servicer shall not be obligated to use separate servicing
procedures, offices, employees or accounts for servicing the Receivables from
the procedures, offices, employees and accounts used by the Servicer in
connection with servicing other credit card receivables.
(d) The Servicer shall comply with and perform its servicing
obligations with respect to the Accounts and Receivables in accordance with the
Cardholder Agreements relating to the Accounts and the Credit Card Guidelines
and all applicable rules and regulations of VISA, MasterCard and any other
similar entity or organization relating to any other type of consumer revolving
credit card accounts included as Accounts, except insofar as any failure to so
comply or perform would not materially and adversely affect the Trust or the
Investor Certificateholders.
(e) The Servicer shall pay out of its own funds, without
reimbursement, all expenses incurred in connection with the Trust and the
servicing activities hereunder including
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expenses related to enforcement of the Receivables, fees and disbursements of
the Trustee, any Paying Agent and any Transfer Agent and Registrar (including
the reasonable fees and expenses of its counsel) and independent accountants and
all other fees and expenses, including the costs of filing UCC financing and
continuation statements and the costs and expenses relating to obtaining and
maintaining the listing of any Investor Certificates on any stock exchange, that
are not expressly stated in this Agreement to be payable by the Trust or the
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) The Servicer agrees that upon a request by the Transferor it
will use its reasonable best efforts to obtain and maintain the listing of the
Investor Certificates of any Series or Class on any specified security exchange.
If any such request is made, the Servicer shall give notice to the Transferor
and the Trustee on the date on which such Investor Certificates are approved for
such listing and within three Business Days following receipt of notice by the
Servicer of any actual, proposed or contemplated delisting of such Investor
Certificates by any such securities exchange. The Trustee or the Servicer, each
in its sole discretion, may terminate any listing on any such securities
exchange at any time subject to the notice requirements set forth in the
preceding sentence.
Section 3.02. Servicing Compensation. As full compensation for its
servicing activities hereunder and as reimbursement for any expense incurred by
it in connection therewith, the Servicer shall be entitled to receive a
servicing fee (the "Servicing Fee") with respect to each Monthly Period, payable
monthly on the related Distribution Date, in an amount equal to one-twelfth of
the product of (a) the weighted average of the Servicing Fee Rates with respect
to each outstanding Series (based upon the Servicing Fee Rate for each Series
and the Investor Amount (or such other amount as specified in the related
Supplement) of such Series, in each case as of the last day of the prior Monthly
Period) and (b) the amount of Principal Receivables on the last day of the prior
Monthly Period. The share of the Servicing Fee allocable to (i) the
Certificateholders' Interest of a particular Series with respect to any Monthly
Period (the "Monthly Servicing Fee") and (ii) the Enhancement Investor Amount,
if any, of a particular Series with respect to any Monthly Period will each be
determined in accordance with the relevant Supplement. The portion of the
Servicing Fee with respect to any Monthly Period not so allocated to the
Certificateholders' Interest or the Enhancement Investor Amount, if any, of a
particular Series shall be paid by the Holders of the Transferor Certificates on
the related Distribution Date and in no event shall the Trust, the Trustee, the
Investor Certificateholders of any Series or any Series Enhancer be liable for
the share of the Servicing Fee with respect to any Monthly Period to be paid by
the Holders of the Transferor Certificates.
Section 3.03. Representations, Warranties and Covenants of the
Servicer. Travelers Bank & Trust, fsb, 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:
(a) Organization and Good Standing. The Servicer is a federally
chartered savings bank duly organized, validly existing and in good standing
under the laws of the United States, and has full corporate power and authority
to execute, deliver and perform its obligations under this Agreement and each
Supplement and, in all material respects, to own or lease its
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properties and conduct its business as such properties are presently owned or
leased and as such business is presently conducted.
(b) Due Qualification. The Servicer is duly qualified to do business
and is in good standing as a foreign corporation (or is exempt from such
requirements), and has obtained all necessary licenses and approvals in each
jurisdiction in which failure to so qualify or to obtain such licenses and
approvals would have a material adverse effect on the interests of the Investor
Certificateholders hereunder or under any Supplement.
(c) Due Authorization. The execution, delivery, and performance of
this Agreement and each Supplement, and the other agreements and instruments
executed or to be executed by the Servicer as contemplated hereby, have been
duly authorized by the Servicer by all necessary corporate action on the part of
the Servicer and this Agreement and each Supplement will remain, from the time
of its execution, an official record of the Servicer.
(d) Binding Obligation. This Agreement and each Supplement
constitutes a legal, valid and binding obligation of the Servicer, enforceable
in accordance with its terms, except as enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws now or hereafter in effect, affecting the enforcement of creditors' rights
in general and the rights of creditors of federally chartered savings banks and
except as such enforceability may be limited by general principles of equity
(whether considered in a suit at law or in equity).
(e) No Violation. The execution and delivery of this Agreement and
each Supplement by the Servicer, the performance of the transactions
contemplated by this Agreement and each Supplement and the fulfillment of the
terms hereof and thereof applicable to the Servicer will not conflict with,
violate, result in any breach of any of the material terms and provisions of, or
constitute (with or without notice or lapse of time or both) a default under,
any Requirement of Law applicable to the Servicer or any indenture, contract,
agreement, mortgage, deed of trust or other instrument to which the Servicer is
a party or by which it or any of its properties are bound.
(f) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of the Servicer, threatened against the
Servicer before any court, regulatory body, administrative agency or other
tribunal or governmental instrumentality seeking to prevent the issuance of the
Certificates or the consummation of any of the transactions contemplated by this
Agreement or any Supplement, seeking any determination or ruling that, in the
reasonable judgment of the Servicer, would materially and adversely affect the
performance by the Servicer of its obligations under this Agreement or any
Supplement, or seeking any determination or ruling that, in the reasonable
judgment of the Servicer would, materially and adversely affect the validity or
enforceability of this Agreement or any Supplement.
(g) Compliance with Requirements of Law. The Servicer shall duly
satisfy all obligations on its part to be fulfilled under or in connection with
the Receivables and the related Accounts, will maintain in effect all
qualifications required under Requirements of Law in order to service the
Receivables and the related Accounts properly and will comply in all material
respects with all other Requirements of Law in connection with servicing the
Receivables and
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the related Accounts, the failure to comply with which would have a material
adverse effect on the interests of the Certificateholders.
(h) No Rescission or Cancellation. Subject to Section 3.09, the
Servicer shall not permit any rescission or cancellation of a Receivable except
as ordered by a court of competent jurisdiction or other Governmental Authority
or in the ordinary course of its business and in accordance with the Credit Card
Guidelines.
(i) Protection of Certificateholders' Rights. The Servicer shall
take no action which, nor omit to take any action the omission of which, would
substantially impair the rights of Certificateholders in any Receivable or
Account, nor shall it, except in the ordinary course of its business and in
accordance with the 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 a Receivable, the Servicer will
take no action to cause any Receivable to be evidenced by any instrument (as
defined in the UCC) and, if any Receivable is so evidenced, it shall be
reassigned or assigned to the Servicer as provided in this Section; provided,
however, that Receivables evidenced by notes taken from Obligors in the ordinary
course of business of the Servicer's collection efforts shall not be deemed
Ineligible Receivables solely as a result thereof.
(k) All Consents Required. All approvals, authorizations, consents,
orders or other actions of any Person or of any governmental body or official
required in connection with the execution and delivery by the Servicer of this
Agreement and each Supplement, the performance by the Servicer of the
transactions contemplated by this Agreement and each Supplement and the
fulfillment by the Servicer of the terms hereof and thereof, have been obtained;
except such approvals, authorizations, consents, orders or other actions which
if not obtained, effected or given will not, individually or in the aggregate,
have any material adverse effect upon the execution and delivery by the Servicer
of this Agreement or any Supplement or the performance by the Servicer of the
transactions contemplated by this Agreement and each Supplement and the
fulfillment by the Servicer of the terms hereof and thereof; and provided,
however, that the Servicer makes no representation or warranty regarding state
securities or "blue sky" laws in connection with the distribution of the
Certificates.
For purposes of the representations and warranties set forth in this
Section 3.03, each reference to a Supplement shall be deemed to refer only to
those Supplements in effect as of the relevant Closing Date or the date of
appointment of a Successor Servicer, as applicable.
In the event any of the representations, warranties or covenants of
the Servicer contained in paragraph (g), (h), (i) or (j) with respect to any
Receivable or the related Account is breached, and as a result of such breach
the Trust's rights in, to or under any Receivable in the related Account or the
proceeds of such Receivable are impaired or such proceeds are not available for
any reason to the Trust free and clear of any Lien, then no later than the
expiration of 60 days (or such longer period, not in excess of 150 days, as may
be agreed to by the Trustee) from the earlier to occur of the discovery of such
event by the Servicer, or receipt by the Servicer of notice of such event given
by the Trustee, all Receivables in the Account or
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Accounts to which such event relates shall be reassigned or assigned to the
Servicer on the terms and conditions set forth below; provided, however, that
such Receivables will not be reassigned or assigned to the 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) the Servicer
shall have delivered to the Trustee a certificate of an authorized officer
describing the nature of such breach and the manner in which such breach was
cured.
The Servicer shall effect such assignment by making a deposit into
the Collection Account in immediately available funds on the Transfer Date
following the Monthly Period in which such assignment obligation arises in an
amount equal to the amount of such Receivables, which deposit shall be
considered a Collection of Principal Receivables and shall be applied in
accordance with Article IV and the terms of each Supplement.
Upon each such reassignment or assignment to the Servicer, the
Trustee, on behalf of the Trust, shall automatically and without further action
be deemed to sell, transfer, assign, set over and otherwise convey to the
Servicer, without recourse, representation or warranty, all right, title and
interest of the Trust in and to such Receivables, all monies due or to become
due and all amounts received with respect thereto and all proceeds thereof. The
Trustee shall execute such documents and instruments of transfer or assignment
and take such other actions as shall be reasonably requested by the Servicer to
effect the conveyance of any such Receivables pursuant to this Section. The
obligation of the Servicer to accept reassignment or assignment of such
Receivables, and to make the deposits, if any, required to be made to the
Collection Account as provided in the preceding paragraph, shall constitute the
sole remedy respecting the event giving rise to such obligation available to
Certificateholders (or the Trustee on behalf of Certificateholders) or any
Series Enhancer.
Section 3.04. Reports and Records for the Trustee.
(a) Daily Records. On each Business Day, the Servicer, with prior
written notice by the Trustee shall make or cause to be made available at the
office of the Servicer on any Business Day during normal business hours for
inspection by the Trustee a record setting forth (i) the Collections in respect
of Principal Receivables and in respect of Finance Charge Receivables processed
by the Servicer on the second preceding Business Day in respect of the Accounts
and (ii) the amount of Receivables as of the close of business on the second
preceding Business Day. The Servicer shall, at all times, maintain its computer
files with respect to the Accounts in such a manner so that the Accounts may be
specifically identified.
(b) Monthly Servicer's Certificate. Not later than the Determination
Date immediately preceding each Distribution Date, the Servicer shall, with
respect to each outstanding Series, deliver to the Trustee, the Paying Agent and
each Rating Agency a certificate of a Servicing Officer in substantially the
form set forth in the related Supplement.
Section 3.05. Annual Certificate of Servicer. The Servicer shall
deliver to the Trustee and each Rating Agency, on or before March 31, of each
calendar year, beginning with March 31, 1999, an Officer's Certificate (with
appropriate insertions) substantially in the form of Exhibit D.
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Section 3.06. Annual Servicing Report of Independent Public
Accountants; Copies of Reports Available.
(a) On or before March 31, of each calendar year, beginning with
March 31, 1999, the Servicer shall cause a firm of nationally recognized
independent public accountants (who may also render other services to the
Servicer or the Transferor or any Account Owner) to furnish a report (addressed
to the Trustee) to the Trustee, the Servicer and each Rating Agency to the
effect that they have applied certain procedures agreed upon with the Servicer
and examined certain documents and records relating to the servicing of the
Receivables under this Agreement and each Supplement for the prior calendar year
and that, on the basis of such agreed-upon procedures, nothing has come to the
attention of such accountants that caused them to believe that the servicing
(including the allocation of Collections) has not been conducted in compliance
with the terms and conditions set forth in Articles III and IV and Section 8.08
of this Agreement and the applicable provisions of each Supplement, except for
such exceptions as they believe to be immaterial and such other exceptions as
shall be set forth in such statement. Such report shall set forth the agreed
upon procedures performed.
(b) On or before March 31, of each calendar year, beginning with
March 31, 1999, the Servicer shall cause a firm of nationally recognized
independent public accountants (who may also render other services to the
Servicer or the Transferor or any Account Owner) to furnish a report (addressed
to the Trustee) to the Trustee, the Servicer and each Rating Agency to the
effect that they have applied certain procedures agreed upon with the Servicer
to compare the mathematical calculations of certain amounts set forth in the
Servicer's certificates delivered pursuant to subsection 3.04(b) during the
period covered by such report with the Servicer's computer reports which were
the source of such amounts and that on the basis of such agreed-upon procedures
and comparison, such accountants are of the opinion that such amounts are in
agreement, except for such exceptions as they believe to be immaterial and such
other exceptions as shall be set forth in such statement.
(c) A copy of each certificate and report provided pursuant to
subsection 3.04(b), 3.05 or 3.06 may be obtained by any Investor
Certificateholder or Certificate Owner by a request to the Trustee addressed to
the Corporate Trust Office.
Section 3.07. Tax Treatment. Unless otherwise specified in a
Supplement with respect to a particular Series, the 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 (i) the Investor
Certificates of each Series which are characterized as indebtedness at the time
of their issuance will qualify as indebtedness secured by the Receivables and
(ii) the Trust shall not be treated as an association or publicly traded
partnership taxable as a corporation. The Transferor, by entering into this
Agreement, and each Certificateholder, by the acceptance of any such Certificate
(and each Certificate Owner, by its acceptance of an interest in the applicable
Certificate), agree to treat such Investor Certificates for Federal, state and
local income and franchise tax purposes as indebtedness of the Transferor. Each
Holder of such Investor Certificate agrees that it will cause any Certificate
Owner acquiring an interest in a Certificate through it to comply with this
Agreement as to treatment as indebtedness under applicable tax law, as described
in this Section 3.07. The parties hereto agree that they shall not cause or
permit the making, as applicable, of any election under Treasury Regulation
Section
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301.7701-3 whereby the Trust or any portion thereof would be treated as a
corporation for federal income tax purposes and, except as required by Section
11.11, shall not file tax returns or obtain any federal employer identification
number for the Trust but shall treat the Trust as a security device for such
purposes. The provisions of this Agreement shall be construed in furtherance of
the foregoing intended tax treatment.
Section 3.08. Notices to Travelers Bank & Trust, fsb. In the event
that Travelers Bank & Trust, fsb is no longer acting as Servicer, any Successor
Servicer shall deliver to Travelers Bank & Trust, fsb each certificate and
report required to be provided thereafter pursuant to subsection 3.04(b), 3.05
or 3.06.
Section 3.09. Adjustments.
(a) If the Servicer adjusts downward the amount of any Receivable
because of a rebate, refund, unauthorized charge or billing error to an account
holder, or because such Receivable was created in respect of merchandise which
was refused or returned by an account holder, or if the Servicer otherwise
adjusts downward the amount of any Receivable without receiving Collections
therefor or charging off such amount as uncollectible or for other reasons
relating to the financial condition of the Obligor thereof, then, in any such
case, the amount of Principal Receivables used to calculate the Transferor
Amount, the Series Percentages and any other percentage used to allocate within
or among Series 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, the Series Percentages and any other percentage used to
allocate within or among Series applicable to any Series will be reduced by the
amount of any Receivable which was discovered as having been created through a
fraudulent or counterfeit charge. Any adjustment required pursuant to either of
the two preceding sentences shall be made on or prior to the end of the Monthly
Period in which such adjustment obligation arises. In the event that, following
the exclusion of such Principal Receivables from the calculation of the
Transferor Amount, the Transferor Amount would be less than the Required
Transferor Amount, not later than 12:00 noon, New York City time, on the third
Business Day following the Monthly Period in which such adjustment obligation
arises, the Transferor which transferred such Principal Receivables to the Trust
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
below the Required Transferor Amount (up to the amount of such Principal
Receivables).
(b) If (i) the Servicer makes a deposit into the Collection Account
in respect of a Collection of a Receivable and such Collection was received by
the Servicer in the form of a check which is not honored for any reason or (ii)
the Servicer makes a mistake with respect to the amount of any Collection and
deposits an amount that is less than or more than the actual amount of such
Collection, the Servicer shall appropriately adjust the amount subsequently
deposited into the Collection Account to reflect such dishonored check or
mistake. Any Receivable in respect of which a dishonored check is received shall
be deemed not to have been paid.
Section 3.10. Reports to the Commission. The Servicer shall, on
behalf of the Trust, cause to be filed with the Commission any periodic reports
required to be filed under the
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provisions of the Securities Exchange Act of 1934, as amended, and the rules and
regulations of the Commission thereunder. The Transferor shall, at the expense
of the Servicer, cooperate in any reasonable request of the Servicer in
connection with such filings.
Section 3.11. Reports to Rating Agencies. The Servicer agrees to
deliver the following to each Rating Agency (unless one or more of such Rating
Agencies agrees in writing to waive receipt of such reports, in which case, the
reports need not be delivered to the Rating Agency or Rating Agencies which
waived the requirement):
(a) Within 30 days after the Addition Date with respect to any
Automatic Additional Accounts (as defined in subsection 2.09(d) of this
Agreement), unless the Rating Agency Condition has been satisfied with respect
to the designation of such Automatic Additional Accounts, the Servicer shall
deliver to each Rating Agency a written report which shall contain (i) the
aggregate number of Automatic Additional Accounts designated to the Trust during
the three consecutive Monthly Periods ending with the Monthly Period in which
such Addition Date occurred and the aggregate amount of Principal Receivables
contained in such Automatic Additional Accounts; (ii) the aggregate number of
Automatic Additional Accounts designated to the Trust during the 12 consecutive
Monthly Periods ending with the Monthly Period in which such Addition Date
occurred and the aggregate amount of Principal Receivables contained in such
Automatic Additional Accounts; (iii) the number of Accounts and the amount of
Principal Receivables in the Trust as of the first day of the three consecutive
Monthly Periods described in (i) above occurred; (iv) the number of Accounts and
the amount of Principal Receivables in the Trust as of the first day of the 12
consecutive Monthly Periods described in (ii) above; (v) the percentage which
the number of Automatic Additional Accounts described in (i) above is of the
number of Accounts described in (iii) above; (vi) the percentage which the
amount of Principal Receivables described in (i) above is of the amount of
Principal Receivables described in (iii) above, (vii) the percentage which the
number of Automatic Additional Accounts described in (ii) above is of the number
of Accounts described in (iv) above, and (viii) the percentage which the amount
of Principal Receivables described in (ii) above is of the amount of Principal
Receivables described in (iv) above.
(b) Not later than the Determination Date in each month, the
Servicer shall deliver to each Rating Agency a written report setting forth, as
of the last day of the immediately preceding Monthly Period, the number of
Accounts which had addresses located in the territories or possessions of the
United States or which were military addresses not located in the United States
and the amount of Principal Receivables in such Accounts; provided that the
report described in this provision (b) shall not be required if the number of
such Accounts is less than 1% of all Accounts as of the end of such Monthly
Period and the amount of Principal Receivables in such Accounts is less than 1%
of all Principal Receivables as of the end of such Monthly Period.
[END OF ARTICLE III]
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ARTICLE IV
Rights of Certificateholders and
Allocation and Application of Collections
Section 4.01. Rights of Certificateholders. The Investor
Certificates shall represent fractional undivided interests in the Trust, which,
with respect to each Series, shall consist of the right to receive, to the
extent necessary to make the required payments with respect to the Investor
Certificates of such Series at the times and in the amounts specified in the
related Supplement, the portion of Collections allocable to Investor
Certificateholders of such Series pursuant to this Agreement and such
Supplement, funds on deposit in the Collection Account and the Excess Funding
Account allocable to Certificateholders of such Series pursuant to this
Agreement and such Supplement, funds on deposit in any related Series Account
and funds available pursuant to any related Series Enhancement (collectively,
with respect to all Series, the "Certificateholders' Interest"), it being
understood that the Investor Certificates of any Series or Class shall not
represent any interest in any Series Account or Series Enhancement for the
benefit of any other Series or Class. The Transferor Certificates shall
represent the ownership interest in the remainder of the Trust Assets not
allocated pursuant to this Agreement or any Supplement to the
Certificateholders' Interest, including the right to receive Collections with
respect to the Receivables and other amounts at the times and in the amounts
specified in this Agreement or any Supplement to be paid to the Holders of the
Transferor Certificates (the "Transferor's Interest"); provided, however, that
the Transferor Certificates shall not represent any interest in the Collection
Account, the Excess Funding Account, any Series Account or any Series
Enhancement, except as specifically provided in this Agreement or any
Supplement; provided further, that the foregoing shall not be construed to limit
the Trustee's obligations to make payments to the Holders of the Transferor
Certificates, the Transferor and the Servicer as and when required under this
Agreement and any Supplement.
Section 4.02. Establishment of Collection Account and Excess Funding
Account; Appointment of Securities Intermediary. The Servicer, for the benefit
of the Certificateholders, shall cause to be established and maintained in the
name of the Trustee, on behalf of the Trust, a Qualified Account with a
Securities Intermediary bearing a designation clearly indicating that the funds
and other property credited thereto are held for the benefit of the
Certificateholders (the "Collection Account"). The Collection Account shall
consist of two segregated subaccounts: (1) the "Collection Account Investment
Subaccount," to which financial assets credited to the Collection Account shall
be credited, and as to which financial assets the Securities Intermediary
undertakes to treat the Trustee as entitled to exercise the rights that comprise
such financial assets; and (2) the "Collection Account Cash Subaccount," to
which money or instruments deposited in the Collection Account shall be
credited. The Trustee shall possess all right, title and interest in all funds
and other property on deposit from time to time in or credited to the Collection
Account including the subaccounts therein and all proceeds thereof. The
Collection Account including the subaccounts therein shall be under the sole
dominion and control of the Trustee for the benefit of the Certificateholders.
Except as expressly provided in this Agreement, the Servicer agrees that it
shall have no right of setoff or banker's lien against, and no right to
otherwise deduct from, any funds held in the Collection Account and the
subaccounts therein for any amount owed to it by the Trustee, the Trust, any
Certificateholder or any Series Enhancer. If, at any time, the Collection
Account or any subaccount therein ceases to be a
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Qualified Account, the Trustee (or the Servicer on its behalf) shall within ten
Business Days (or such longer period, not to exceed 30 calendar days, as to
which each Rating Agency may consent) establish a new Collection Account meeting
the conditions specified above, transfer any cash or any investments to such new
Collection Account and from the date such new Collection Account is established,
it shall be the "Collection Account."
Unless the Rating Agency Condition shall have been satisfied, if at
any time neither Travelers Bank & Trust, fsb nor any Affiliate of Travelers Bank
& Trust, fsb is the Servicer, the Collection Account will be moved from
Travelers Bank & Trust, fsb, if then maintained there.
Funds on deposit in the Collection Account (other than amounts
deposited pursuant to Section 2.06, 10.01 or 12.02) shall be invested by the
Trustee in Eligible Investments in accordance with written instructions of the
Servicer. All such Eligible Investments shall be held by the Trustee or its
nominee for the benefit of the Certificateholders in the Collection Account
Investment Subaccount. The Trustee shall maintain for the benefit of the
Certificateholders possession of the instruments or securities,if any,
evidencing such Eligible Investments. Delivery of any Eligible Investment to the
Trustee, and custody of the same by the Trustee, may be through the Securities
Intermediary. Investments of funds representing Collections collected during any
Monthly Period shall be invested in Eligible Investments that will mature so
that funds will be available at the close of business on the Transfer Date
following such Monthly Period. Unless directed by the Servicer in writing, funds
deposited in the Collection Account on a Transfer Date with respect to the next
following Distribution Date are not required to be invested overnight. For
purposes of determining the availability of funds or the balances in the
Collection Account for any reason under this Agreement, all investment earnings
net of investment expenses and losses on such funds shall be deemed not to be
available or on deposit.
The Servicer, for the benefit of the Certificateholders, shall cause
to be established and maintained in the name of the Trustee, on behalf of the
Trust, a Qualified Account with a Securities Intermediary bearing a designation
clearly indicating that the funds and other property deposited therein or
credited thereto are held for the benefit of the Certificateholders (the "Excess
Funding Account"). The Excess Funding Account shall consist of two segregated
subaccounts: (i) the "Excess Funding Investment Subaccount," to which financial
assets credited to the Excess Funding Account shall be credited, and as to which
financial assets the Securities Intermediary undertakes to treat the Trustee as
entitled to exercise the rights that comprise such financial assets; and (ii)
the "Excess Funding Account Cash Subaccount," to which money or instruments
deposited in the Excess Funding Account shall be credited. The Trustee shall
possess all right, title and interest in all funds and other property on deposit
from time to time in or credited to the Excess Funding Account including the
subaccounts therein and all proceeds thereof. The Excess Funding Account
including any subaccounts therein shall be under the sole dominion and control
of the Trustee for the benefit of the Certificateholders. Except as expressly
provided in this Agreement, the Servicer agrees that it shall have no right of
setoff or banker's lien against, and no right to otherwise deduct from, any
funds held in the Excess Funding Account and the subaccounts therein for any
amount owed to it by the Trustee, the Trust, any Certificateholder or any Series
Enhancer. If, at any time, the Excess Funding Account or any subaccount therein
cease to be a Qualified Account,
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the Trustee (or the Servicer on its behalf) shall within 10 Business Days (or
such longer period, not to exceed 30 calendar days, as to which each Rating
Agency may consent) establish a new Excess Funding Account meeting the
conditions specified above, transfer any cash or any investments to such new
Excess Funding Account and from the date such new Excess Funding Account is
established, it shall be the "Excess Funding Account."
Unless otherwise agreed to by each Rating Agency, if at any time
neither Travelers Bank & Trust, fsb nor any Affiliate of Travelers Bank & Trust,
fsb is the Servicer, the Excess Funding Account will be moved from Travelers
Bank & Trust, fsb if then maintained there.
Funds on deposit in the Excess Funding Account shall be invested by
the Trustee in Eligible Investments in accordance with written instructions of
the Servicer. All such Eligible Investments shall be held by the Trustee or its
nominee for the benefit of the Certificateholders in the Excess Funding
Investment Subaccount. Delivery of any Eligible Investment to the Trustee, and
custody of the same by the Trustee, may be through the Securities Intermediary.
The Trustee shall maintain for the benefit of the Certificateholders possession
of the instruments or securities, if any, evidencing such Eligible Investments.
Funds on deposit in the Excess Funding Account on any date (after giving effect
to any withdrawals from the Excess Funding Account on such date) will be
invested in Eligible Investments that will mature so that funds will be
available at the close of business on the Transfer Date following such date.
Unless directed by the Servicer in writing, funds deposited in the Excess
Funding Account on a Transfer Date with respect to the next following
Distribution Date are not required to be invested overnight. On each Transfer
Date, the Servicer shall instruct the Trustee to withdraw on the related
Distribution Date from the Excess Funding Account and deposit in the Collection
Account all interest and other investment earnings (net of losses and investment
expenses) on funds and other property on deposit in or credited to the Excess
Funding Account, for application as Collections of Finance Charge Receivables
with respect to the prior Monthly Period. Interest (including reinvested
interest) and other investment income and earnings on funds and other property
on deposit in or credited to the Excess Funding Account shall not be considered
part of the Excess Funding Amount for purposes of this Agreement. On each
Business Day on which funds are on deposit in the Excess Funding Account, the
Servicer shall determine the lesser of (x) the amount by which the Transferor
Amount exceeds the Required Transferor Amount on such date and (y) the amount by
which the product of (i) the aggregate amount of Principal Receivables and (ii)
one minus the Discount Percentage exceeds the required Principal Balance and
shall instruct the Trustee to withdraw such lesser amount, if any, from the
Excess Funding Account (to the extent of funds on deposit therein on such date)
and pay such amount to the Holders of the Transferor Certificates. On any
Transfer Date on which one or more Series is in an Accumulation Period or
Amortization Period, the Servicer shall determine the aggregate amount of
Principal Shortfalls, if any, with respect to each such Series that is a
Principal Sharing Series (after giving effect to the allocation and payment
provisions in the Supplement with respect to each such Series), and the Servicer
shall instruct the Trustee to withdraw such amount (up to the Excess Funding
Amount) from the Excess Funding Account on the succeeding Distribution Date and
allocate such amount among each such Series as Shared Principal Collections as
specified herein and in each related Supplement.
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The Bank of New York is hereby appointed as the initial Securities
Intermediary hereunder and The Bank of New York hereby accepts such appointment.
The Securities Intermediary shall be, and The Bank of New York as
initial Securities Intermediary hereunder hereby represents that it is, as of
the date hereof and shall be for so long as it is the Securities Intermediary
hereunder a corporation or national bank that (i) capacity hereunder, and (ii)
maintains a Participant's Securities Account (as defined in the United States
Regulations) with a Federal Reserve Bank. The Securities Intermediary shall
agree and the Bank of New York, as Securities Intermediary does hereby agree
with the parties hereto that each of the Collection Account Investment
Subaccount and the Excess Funding Account Investment Subaccount shall be an
account to which financial assets may be credited and shall undertake to treat
the Trustee as entitled to exercise rights that comprise such financial assets
and to exercise the ordinary rights of an entitlement holder, in accordance with
the UCC as in effect in the State of New York. The Securities Intermediary shall
acknowledge and The Bank of New York does hereby acknowledge that the
"securities intermediary's jurisdiction" as defined in the UCC as in effect in
the State of New York with respect to the Eligible Investments, shall be the
State of New York. The Securities Intermediary shall represent and covenant that
it is not and will not be (as long as it is the Securities Intermediary
hereunder) a party to any agreement that is inconsistent with the provisions of
this Agreement. The Securities Intermediary shall covenant that it will not take
any action inconsistent with the provisions of this Agreement applicable to it.
It is the intent of the Trustee, the Servicer and the Transferor
that each of the Collection Account Subaccount and the Excess Funding Account
Investment Subaccount shall be a securities account of the Trustee and not an
account of the Transferor or the Servicer. If despite such intent, any of the
Collection Account or the Excess Funding Account is determined to be an account
of the Transferor or the Servicer, then (i) the Securities Intermediary agrees
to comply with entitlement orders originated by the Trustee without further
consent by the Transferor or the Servicer, and (ii) The Bank of New York as
initial Security Intermediary agrees that for so long as it is the Securities
Intermediary hereunder, it will comply with entitlement orders originated by the
Trustee without further consent by the Transferor or the Servicer.
Section 4.03. Collections and Allocations.
(a) Collections. The Servicer will apply or will instruct the
Trustee to apply all funds on deposit in the Collection Account as described in
this Article IV and in each Supplement. Except as otherwise provided below or as
expressly provided in any Supplement with respect to Collections allocated to
the related Series, the Servicer shall deposit Collections into the Collection
Account no later than the second Business Day following the Date of Processing
of such Collections. Subject to the express terms of any Supplement, but
notwithstanding anything else in this Agreement to the contrary, for so long as
Travelers Bank & Trust, fsb remains the Servicer and (x) Travelers Bank & Trust,
fsb maintains a certificate of deposit rating of A-1 or better by Standard &
Poor's and P-1 by Moody's (or such other rating below A-1 or P-1, as the case
may be, which is satisfactory to each Rating Agency), (y) Commercial Credit
Company has a commercial paper rating of at least A-1 and P-1 by Standard &
Poor's and Moody's, Travelers Bank & Trust, fsb remains a direct or indirect
majority-owned
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Travelers Group Inc. subsidiary and certain other arrangements are made
satisfactory to each Rating Agency or (z) any other arrangement that satisfies
the Rating Agency Condition, the Servicer need not make daily deposits of
collections into the Collection Account, but may make a single monthly deposit
into the Collection Account in immediately available funds. Subject to the
express terms of any Supplement, but notwithstanding anything else in this
Agreement to the contrary, with respect to any Monthly Period, whether the
Servicer is required to make deposits of Collections pursuant to the first or
the second preceding sentence, (i) the Servicer will only be required to deposit
Collections into the Collection Account up to the aggregate amount of
Collections required to be deposited into any Series Account or, without
duplication, distributed on or prior to the related Distribution Date to
Investor Certificateholders or to any Series Enhancer pursuant to the terms of
any Supplement or Enhancement Agreement and (ii) if at any time prior to such
Distribution Date the amount of Collections deposited in the Collection Account
exceeds the amount required to be deposited pursuant to clause (i) above, the
Servicer will be permitted to withdraw the excess from the Collection Account.
(b) Allocations for the Transferor Certificates. Throughout the
existence of the Trust, unless otherwise stated in any Supplement, the Servicer
shall allocate to the Holders of the Transferor Certificates an amount equal to
the product of (A) the Transferor Percentage and (B) the aggregate amount of
such Collections allocated to Principal Receivables and Finance Charge
Receivables, respectively, in respect of each Monthly Period. Notwithstanding
anything in this Agreement to the contrary, unless otherwise stated in any
Supplement, the Servicer need not deposit this amount or any other amounts so
allocated to the Transferor Certificates pursuant to any Supplement into the
Collection Account and shall pay, or be deemed to pay, such amounts as collected
to the Holders of the Transferor Certificates.
The payments to be made to the Holders of the Transferor
Certificates pursuant to this subsection 4.03(b) do not apply to deposits to the
Collection Account or other amounts that do not represent Collections, including
payment of the acquisition price for Receivables pursuant to Section 2.06 or
10.01, proceeds from the sale, disposition or liquidation of Receivables
pursuant to Section 12.02 or payment of the acquisition price for the
Certificateholders' Interest of a specific Series pursuant to the related
Supplement.
Section 4.04. Shared Collections.
(a) On each Distribution Date, (i) the Servicer shall allocate
Shared Principal Collections to each Principal Sharing Series, pro rata, in
proportion to the Principal Shortfalls, if any, with respect to each such Series
and (ii) the Servicer shall withdraw from the Collection Account and pay to the
Holders of the Transferor Certificates an amount equal to the excess, if any, of
(x) the aggregate amount for all outstanding Series of Collections of Principal
Receivables which the related Supplements or this Agreement specify are to be
treated as "Shared Principal Collections" for such Distribution Date over (y)
the aggregate amount for all outstanding Principal Sharing Series which the
related Supplements specify are "Principal Shortfalls" for such Distribution
Date; provided, however, that if, on any Distribution Date the Transferor Amount
is less than or equal to the Required Transferor Amount or if an amount equal to
the product of (i) the aggregate amount of Principal Receivables and (ii) one
minus the Discount Percentage is less than the Required Principal Balance, the
Servicer will not distribute to the Holders of the Transferor Certificates any
Shared Principal Collections that otherwise
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would be distributed to the Holders of the Transferor Certificates but shall
deposit such funds in the Excess Funding Account. Notwithstanding the foregoing,
a Group of Series may specify in their related Supplement that Shared Principal
Collections from such Series shall be allocated as provided above but only among
the Series in such Group.
(b) On each Distribution Date, (i) the Servicer shall allocate
Excess Finance Charge Collections (as described below) to each Excess Allocation
Series pro rata, in proportion to the Finance Charge Shortfalls (as described
below), if any, with respect to each such Series and (ii) the Servicer shall
withdraw from the Collection Account and pay to the Holders of the Transferor
Certificates an amount equal to the excess, if any, of (x) the aggregate amount
for all outstanding Series of Collections of Finance Charge Receivables 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 which the related Supplements specify are "Finance Charge
Shortfalls" for such Series and such Distribution Date; provided, however, that
the sharing of Excess Finance Charge Collections among Series will continue only
until such time, if any, at which the Transferor shall deliver to the Trustee an
Officer's Certificate to the effect that, in the reasonable belief of the
Transferor the continued sharing of Excess Finance Charge Collections among
Series would have adverse regulatory implications with respect to the
Transferor. Following the delivery by the Transferor of such an Officer's
Certificate to the Trustee there will not be any further sharing of Excess
Finance Charge Collections among Series. Notwithstanding the foregoing, a Group
of Series may specify in their related Supplement that Excess Finance Charge
Collections from such Series shall be allocated as provided above but only among
the Series in such Group.
(c) The Servicer will determine the amount of Collections of Finance
Charge Receivables for any Monthly Period allocated to the Transferor's Interest
but not due to the Holder of any Supplemental Certificate and other amounts
otherwise payable to the Transferor with respect to Collections of Finance
Charge Receivables regardless of whether such collections were initially
allocated to the Transferor or any Series (the "Excess Transferor Finance Charge
Collections") and such Excess Transferor Finance Charge Collections shall be
applied to cover any Finance Charge Shortfalls in each Series entitled to Excess
Transferor Finance Charge Collections, pro rata, based upon the amount of the
Finance Charge Shortfall, if any of each such Series (in each case after giving
effect to the application of Excess Finance Charge Collections, if any, to such
Series). In all cases, any Excess Transferor Finance Charge Collections
remaining after covering shortfalls with respect to all designated Series will
be treated as Shared Transferor Principal Collections.
(d) The Servicer will determine the amount of Collections of
Principal Receivables for any Monthly Period allocated to the Transferor's
Interest but not due to the Holder of any Supplemental Certificate and other
amounts payable to the Transferor with respect to collections of Principal
Receivables, regardless of whether such Collections were initially allocated to
the Transferor or any Series, plus the amount of Excess Transferor Finance
Charge Collections remaining after application to each Series to cover Finance
Charge Shortfalls as provided in subsection 4.04(c) above (collectively, "Shared
Transferor Principal Collections"). The Servicer will allocate the Shared
Transferor Principal Collections to cover any Principal Shortfalls that have not
been covered out of the Shared Principal Collections allocated to each Series
that has been designated in the applicable Supplement as being entitled to
receive Shared
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Transferor Principal Collections. If Principal Shortfalls remaining after the
application of Shared Principal Collections exceed Shared Transferor Principal
Collections for any Monthly Period, Shared Transferor Principal Collections will
be allocated pro rata among each Series which in accordance with the Supplement
for such Series is designated as being entitled to received Shared Transferor
Principal Collections, and the balance will be paid to the Holders of the
Transferor Certificates.
Section 4.05. Additional Withdrawals from the Collection Account. On
or before the Determination Date with respect to any Monthly Period, the
Servicer shall determine the amounts payable to Travelers Bank & Trust, fsb, The
Travelers Bank USA or any other Account Owner with respect to such Monthly
Period under the applicable Receivables Transfer Agreement in respect of amounts
on deposit in the Collection Account, if any, that were not transferred to the
Transferor under such Receivables Transfer Agreement, and the Servicer shall
withdraw such amounts from the Collection Account and pay such amount to
Travelers Bank & Trust, fsb, The Travelers Bank USA or other Account Owner, as
applicable.
Section 4.06. Allocation of Trust Assets to Series or Groups. To the
extent so provided in the Supplement for any Series or in an amendment to this
Agreement executed pursuant to subsection 13.01(a), Receivables conveyed to the
Trust pursuant to Section 2.01 and Receivables or Participation Interests
conveyed to the Trust pursuant to Section 2.09 or any Participation Interest
Supplement, and all Collections received with respect to such Receivables or
Participation Interests, may be allocated in whole or in part to one or more
Series or Groups as may be provided in such Supplement or amendment, provided,
however, that any such allocation shall be effective only upon satisfaction of
the following conditions:
(i) on or before the fifth Business Day immediately
preceding such allocation, the Servicer shall have given the Trustee
and each Rating Agency written notice of such allocation;
(ii) the Rating Agency Condition shall have been
satisfied with respect to such allocation; and
(iii) the Servicer shall have delivered to the Trustee
an Officer's Certificate, dated the date of such allocation, to the
effect that the Servicer reasonably believes that such allocation
will not have an Adverse Effect.
Any such Supplement or amendment may provide that (i) such
allocation to one or more particular Series or Groups may terminate upon the
occurrence of certain events specified therein and (ii) that upon the occurrence
of any such event, such assets and any Collections with respect thereto, shall
be reallocated to other Series or Groups or to all Series, all as shall be
provided in such Supplement or amendment.
[END OF ARTICLE IV]
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ARTICLE V
Distributions and Reports to
Certificateholders
Distributions shall be made to, and reports shall be provided to,
Certificateholders as set forth in the applicable Supplement.
[END OF ARTICLE V]
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ARTICLE VI
The Certificates
Section 6.01. The Certificates. The Investor Certificates of any
Series or Class may be issued in bearer form ("Bearer Certificates") with
attached interest coupons and any other applicable coupon (collectively, the
"Coupons") or in fully registered form ("Registered Certificates") and shall be
substantially in the form of the exhibits with respect thereto attached to the
applicable Supplement. The Transferor Certificate will be issued in registered
form, substantially in the form of Exhibit A, and shall upon issuance be
executed and delivered by the Transferor to the Trustee for authentication and
redelivery as provided in Section 6.02. Except as otherwise provided in Section
6.03 or in any Supplement, Bearer Certificates shall be issued in minimum
denominations of $100,000 and Registered Certificates shall be issued in minimum
denominations of $1,000 and in integral multiples of $1,000 in excess thereof.
If specified in any Supplement, the Investor Certificates of any Series or Class
shall be issued upon initial issuance as a single certificate evidencing the
aggregate original principal amount of such Series or Class as described in
Section 6.13. The Transferor Certificate shall be a single certificate and shall
initially represent the entire Transferor's Interest. Each Certificate shall be
executed by manual or facsimile signature on behalf of the Transferor by its
respective President or any Vice President. Certificates bearing the manual or
facsimile signature of an individual who was, at the time when such signature
was affixed, authorized to sign on behalf of the Transferor shall not be
rendered invalid, notwithstanding that such individual ceased to be so
authorized prior to the authentication and delivery of such Certificates or does
not hold such office at the date of such Certificates. No Certificates shall be
entitled to any benefit under this Agreement, or be valid for any purpose,
unless there appears on such Certificate a certificate of authentication
substantially in the form provided for herein executed by or on behalf of the
Trustee by the manual signature of a duly authorized signatory, and such
certificate upon any Certificate shall be conclusive evidence, and the only
evidence, that such Certificate has been duly authenticated and delivered
hereunder. Bearer Certificates shall be dated the related Closing Date. All
Registered Certificates and Transferor Certificates shall be dated the date of
their authentication.
Section 6.02. Authentication of Certificates. The Trustee shall
authenticate and deliver the Investor Certificates of each Series and Class that
are issued upon original issuance to or upon the order of the Transferor against
payment to the Transferor of the purchase price therefor. The Trustee shall
authenticate and deliver the Transferor Certificate to the Transferor
simultaneously with its delivery of the Investor Certificates of the first
Series to be issued hereunder. If specified in the related Supplement for any
Series or Class, the Trustee shall authenticate and deliver outside the United
States the Global Certificate that is issued upon original issuance thereof.
Section 6.03. New Issuances.
(a) The Transferor may from time to time direct the Trustee, on
behalf of the Trust, to authenticate one or more new Series of Investor
Certificates. The Investor Certificates of all outstanding Series shall be
equally and ratably entitled as provided herein to the benefits of this
Agreement without preference, priority or distinction, all in accordance with
the terms
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and provisions of this Agreement and the applicable Supplement except, with
respect to any Series or Class, as provided in the related Supplement.
(b) On or before the Closing Date relating to any new Series, the
parties hereto will execute and deliver a Supplement which will specify the
Principal Terms of such new Series. The terms of such Supplement may modify or
amend the terms of this Agreement solely as applied to such new Series. The
obligation of the Trustee to authenticate the Investor Certificates of such new
Series and to execute and deliver the related Supplement is subject to the
satisfaction of the following conditions:
(i) on or before the fifth day immediately preceding the
Closing Date, the Transferor shall have given the Trustee and the
Servicer notice of such issuance and the Closing Date; and on or
before the tenth day immediately preceding the Closing Date, the
Transferor shall have given each Rating Agency notice of such
issuance;
(ii) the Transferor shall have delivered to the Trustee
the related Supplement, in form satisfactory to the Trustee,
executed by each party thereto;
(iii) the Transferor shall have delivered to the Trustee
any related Enhancement Agreement executed by each of the parties
thereto, other than the Trustee;
(iv) the Rating Agency Condition shall have been
satisfied with respect to such issuance;
(v) the Transferor shall have delivered to the Trustee
an Officer's Certificate, dated the Closing Date, to the effect that
the 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 a Pay Out Event or a
Reinvestment Event to occur with respect to any Series; and
(vi) the Transferor shall have delivered to the Trustee
and each Rating Agency a Tax Opinion, dated the Closing Date, with
respect to such issuance.
Upon satisfaction of the above conditions, the Trustee shall execute the
Supplement and authenticate the Investor Certificates of such Series upon
execution thereof by the Transferor.
(c) The Transferor may surrender the Transferor Certificate to the
Trustee in exchange for a newly issued Transferor Certificate and one or more
additional certificates (each a "Supplemental Certificate"), the terms of which
shall be defined in a supplement to this Agreement (which supplement shall be
subject to subsection 13.01(a) only to the extent that it amends any of the
terms of this Agreement), to be delivered to or upon the order of the Transferor
(or the Holder of a Supplemental Certificate, in the case of the transfer or
exchange thereof, as provided below), upon satisfaction of the following
conditions:
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(i) The Transferor shall have given written notice to
each Rating Agency of such exchange and the Rating Agency condition
shall have been satisfied with respect to such exchange;
(ii) the Transferor Amount (excluding the interest
represented by any Supplemental Certificate) shall not be less than
2% of the total amount of Principal Receivables as of the date of,
and after giving effect to, such exchange; and
(iii) if any Series of Investor Certificates are
outstanding that were characterized as debt at the time of their
issuance, the Transferor shall have delivered to the Trustee and
each Rating Agency a Tax Opinion, dated the date of such exchange
(or transfer or exchange as provided below), with respect thereto.
Any Supplemental Certificate may be transferred or exchanged only upon
satisfaction of the conditions set forth in clause (ii) and (iii) above.
(d) The Transferor Certificate (or any interest therein) may be
transferred to a Person which is a member of the "affiliated group" of which
Travelers Group Inc. is the "common parent" (as such terms are defined in
Section 1504(a) of the Code); provided that if any Series of Investor
Certificates are outstanding that were characterized as debt at the time of
their issuance, the Transferor shall have delivered to the Trustee and each
Rating Agency a Tax Opinion, dated the date of such transfer, with respect
thereto.
Section 6.04. Registration of Transfer and Exchange of Certificates.
(a) The Trustee shall cause to be kept at the office or agency to be
maintained in accordance with the provisions of Section 11.16 a register (the
"Certificate Register") in which, subject to such reasonable regulations as it
may prescribe, a transfer agent and registrar (which may be the Trustee) (the
"Transfer Agent and Registrar") shall provide for the registration of the
Registered Certificates and of transfers and exchanges of the Registered
Certificates as herein provided. The Transfer Agent and Registrar shall
initially be the Trustee and any co-transfer agent and co-registrar chosen by
the Transferor and acceptable to the Trustee, including, if and so long as any
Series or Class is listed on the Luxembourg Stock Exchange and such exchange
shall so require, a co-transfer agent and co-registrar in Luxembourg. Any
reference in this Agreement to the Transfer Agent and Registrar shall include
any co-transfer agent and co-registrar unless the context requires otherwise.
The Trustee may revoke such appointment and remove any Transfer
Agent and Registrar if the Trustee determines in its sole discretion that such
Transfer Agent and Registrar failed to perform its obligations under this
Agreement in any material respect. Any Transfer Agent and Registrar shall be
permitted to resign as Transfer Agent and Registrar upon 30 days' notice to the
Transferor, the Trustee and the Servicer; provided, however, that such
resignation shall not be effective and such Transfer Agent and Registrar shall
continue to perform its duties as Transfer Agent and Registrar until the Trustee
has appointed a successor Transfer Agent and Registrar reasonably acceptable to
the Transferor.
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Subject to paragraph (c) below, upon surrender for registration of
transfer of any Registered Certificate at any office or agency of the Transfer
Agent and Registrar maintained for such purpose, one or more new Registered
Certificates (of the same Series and Class) in authorized denominations of like
aggregate fractional undivided interests in the Certificateholders' Interest
shall be executed, authenticated and delivered, in the name of the designated
transferee or transferees.
At the option of a Registered Certificateholder, Registered
Certificates (of the same Series and Class) may be exchanged for other
Registered Certificates of authorized denominations of like aggregate fractional
undivided interests in the Certificateholders' Interest, upon surrender of the
Registered Certificates to be exchanged at any such office or agency; Registered
Certificates, including Registered Certificates received in exchange for Bearer
Certificates, may not be exchanged for Bearer Certificates. At the option of the
Holder of a Bearer Certificate, subject to applicable laws and regulations,
Bearer Certificates may be exchanged for other Bearer Certificates or Registered
Certificates (of the same Series and Class) of authorized denominations of like
aggregate fractional undivided interests in the Certificateholders' Interest,
upon surrender of the Bearer Certificates to be exchanged at an office or agency
of the Transfer Agent and Registrar located outside the United States. Each
Bearer Certificate surrendered pursuant to this Section shall have attached
thereto all unmatured Coupons; provided that any Bearer Certificate, so
surrendered after the close of business on the Record Date preceding the
relevant payment date after the expected final payment date need not have
attached the Coupon relating to such payment date (in each case, as specified in
the applicable Supplement).
Whenever any Investor Certificates are so surrendered for exchange,
the Transferor shall execute, the Trustee shall authenticate and the Transfer
Agent and Registrar shall deliver (in the case of Bearer Certificates, outside
the United States) the Investor Certificates which the Investor
Certificateholder making the exchange is entitled to receive. Every Investor
Certificate presented or surrendered for registration of transfer or exchange
shall be accompanied by a written instrument of transfer in a form satisfactory
to the Trustee or the Transfer Agent and Registrar duly executed by the Investor
Certificateholder or the attorney-in-fact thereof duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Investor Certificates, but the Transfer Agent and Registrar may
require payment of a sum sufficient to cover any tax or governmental charge that
may be imposed in connection with any such transfer or exchange.
All Investor Certificates (together with any Coupons) surrendered
for registration of transfer and exchange or for payment shall be canceled and
disposed of in a manner satisfactory to the Trustee. The Trustee shall cancel
and destroy any Global Certificate upon its exchange in full for Definitive
Euro-Certificates and shall deliver a certificate of destruction to the
Transferor. Such certificate shall also state that a certificate or certificates
of a Foreign Clearing Agency to the effect referred to in Section 6.13 was
received with respect to each portion of the Global Certificate exchanged for
Definitive Euro-Certificates.
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The Transferor shall execute and deliver to the Trustee Bearer
Certificates and Registered Certificates in such amounts and at such times as
are necessary to enable the Trustee to fulfill its responsibilities under this
Agreement, each Supplement and the Certificates.
(b) The Transfer Agent and Registrar will maintain at its expense in
each of the Borough of Manhattan, the City of New York, and, if and so long as
any Series or Class is listed on the Luxembourg Stock Exchange, Luxembourg, the
co-transfer agent and co-registrar appointed pursuant to Section 6.04(a) shall
maintain 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).
(c)(i) Registration of transfer of Investor Certificates containing
a legend substantially to the effect set forth on Exhibit E-1 shall
be effected only if such transfer (x) is made pursuant to an
effective registration statement under the Act, or is exempt from
the registration requirements under the Act, and (y) is made to a
Person which is not an employee benefit plan, trust or account,
including an individual retirement account, that is subject to ERISA
or that is described in Section 4975(e)(1) of the Code or an entity
whose underlying assets include plan assets by reason of a plan's
investment in such entity (a "Benefit Plan"). In the event that
registration of a transfer is to be made in reliance upon an
exemption from the registration requirements under the Act, the
transferor or the transferee shall deliver, at its expense, to the
Transferor, the Servicer and the Trustee, an investment letter from
the transferee, substantially in the form of the investment and
ERISA representation letter attached hereto as Exhibit E-2, and no
registration of transfer shall be made until such letter is so
delivered.
Investor Certificates issued upon registration or
transfer of, or Investor Certificates issued in exchange for,
Investor Certificates bearing the legend referred to above shall
also bear such legend unless the Transferor, the Servicer, the
Trustee and the Transfer Agent and Registrar receive an Opinion of
Counsel, satisfactory to each of them, to the effect that such
legend may be removed.
Whenever an Investor Certificate containing the legend
referred to above is presented to the Transfer Agent and Registrar
for registration of transfer, the Transfer Agent and Registrar shall
promptly seek instructions from the Servicer regarding such transfer
and shall be entitled to receive instructions signed by a Servicing
Officer prior to registering any such transfer. The Transferor
hereby agrees to indemnify the Transfer Agent and Registrar and the
Trustee and to hold each of them harmless against any loss,
liability or expense incurred without negligence or bad faith on
their part arising out of or in connection with actions taken or
omitted by them in relation to any such instructions furnished
pursuant to this clause (i).
(ii) Registration of transfer of Investor Certificates
containing a legend to the effect set forth on Exhibit E-3 shall be
effected only if such transfer
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is made to a Person which is not a Benefit Plan. By accepting and
holding any such Investor Certificate, an Investor Certificateholder
shall be deemed to have represented and warranted that it is not a
Benefit Plan. By acquiring any interest in a Book-Entry Certificate
which contains such legend, a Certificate Owner shall be deemed to
have represented and warranted that it is not a Benefit Plan.
(iii) If so requested by the Transferor, the Trustee
will make available to any prospective purchaser of Investor
Certificates who so requests, a copy of a letter provided to the
Trustee by or on behalf of the Transferor relating to the
transferability of any Series or Class to a Benefit Plan.
Section 6.05. Mutilated, Destroyed, Lost or Stolen Certificates. If
(a) any mutilated Certificate (together, in the case of Bearer Certificates,
with all unmatured Coupons (if any) appertaining thereto) is surrendered to the
Transfer Agent and Registrar, or the Transfer Agent and Registrar receives
evidence to its satisfaction of the destruction, loss or theft of any
Certificate and (b) there is delivered to the Transfer Agent and Registrar and
the Trustee such security or indemnity as may be required by them to save each
of them harmless, then, in the absence of notice to the Trustee that such
Certificate has been acquired by a bona fide purchaser, the Transferor shall
execute, the Trustee shall authenticate and the Transfer Agent and Registrar
shall deliver (in the case of Bearer Certificates, outside the United States),
in exchange for or in lieu of any such mutilated, destroyed, lost or stolen
Certificate, a new Certificate of like tenor and aggregate fractional undivided
interest. In connection with the issuance of any new Certificate under this
Section, the Trustee or the Transfer Agent and Registrar may require the payment
by the Certificateholder of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee and Transfer Agent and
Registrar) connected therewith. Any duplicate Certificate issued pursuant to
this Section shall constitute complete and indefeasible evidence of ownership in
the Trust, as if originally issued, whether or not the lost, stolen or destroyed
Certificate shall be found at any time.
Section 6.06. Persons Deemed Owners. The Trustee, the Paying Agent,
the Transfer Agent and Registrar and any agent of any of them may (a) prior to
due presentation of a Registered Certificate for registration of transfer, treat
the Person in whose name any Registered Certificate is registered as the owner
of such Registered Certificate for the purpose of receiving distributions
pursuant to the terms of the applicable Supplement and for all other purposes
whatsoever, and (b) treat the bearer of a Bearer Certificate or Coupon as the
owner of such Bearer Certificate or Coupon for the purpose of receiving
distributions pursuant to the terms of the applicable Supplement and for all
other purposes whatsoever; and, in any such case, neither the Trustee, the
Paying Agent, the Transfer Agent and Registrar nor any agent of any of them
shall be affected by any notice to the contrary. Notwithstanding the foregoing,
in determining whether the Holders of the requisite Investor Certificates have
given any request, demand, authorization, direction, notice, consent or waiver
hereunder, Certificates owned by any of the Transferor, any Account Owner, the
Servicer, any other Holder of a Transferor Certificate, the Trustee or any
Affiliate thereof, shall be disregarded and deemed not to be outstanding, except
that, in determining whether the Trustee shall be protected in relying upon any
such request, demand, authorization, direction, notice, consent or waiver, only
Certificates which the Trustee actually knows to be so owned shall be so
disregarded. Certificates so owned
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which have been pledged in good faith shall not be disregarded and may be
regarded as outstanding if the pledgee establishes to the satisfaction of the
Trustee the pledgee's right so to act with respect to such Certificates and that
the pledgee is not the Transferor, the Servicer, any other Holder of a
Transferor Certificate or any Affiliate thereof.
Section 6.07. Appointment of Paying Agent. The Paying Agent shall
make distributions to Investor Certificateholders from the Collection Account or
any applicable Series Account pursuant to the provisions of the applicable
Supplement and shall report the amounts of such distributions to the Trustee.
Any Paying Agent shall have the revocable power to withdraw funds from the
Collection Account or any applicable Series Account for the purpose of making
the distributions referred to above. The Trustee may revoke such power and
remove the Paying Agent if the Trustee determines in its sole discretion that
the Paying Agent shall have failed to perform its obligations under this
Agreement or any Supplement in any material respect. The Paying Agent shall
initially be the Trustee and any co-paying agent chosen by the Transferor and
acceptable to the Trustee, including, if and so long as any Series or Class is
listed on the Luxembourg Stock Exchange and such exchange so requires, a
co-paying agent in Luxembourg or another western European city. Any Paying Agent
shall be permitted to resign as Paying Agent upon 30 days' notice to the
Trustee. In the event that any Paying Agent shall resign, the Trustee shall
appoint a successor to act as Paying Agent. The Trustee shall cause each
successor or additional Paying Agent to execute and deliver to the Trustee an
instrument in which such successor or additional Paying Agent shall agree with
the Trustee that it will hold all sums, if any, held by it for payment to the
Investor Certificateholders in trust for the benefit of the Investor
Certificateholders entitled thereto until such sums shall be paid to such
Investor Certificateholders. The Paying Agent shall return all unclaimed funds
to the Trustee and upon removal shall also return all funds in its possession to
the Trustee. The provisions of Sections 11.01, 11.02, 11.03 and 11.05 shall
apply to the Trustee also in its role as Paying Agent, for so long as the
Trustee shall act as Paying Agent. Any reference in this Agreement to the Paying
Agent shall include any co-paying agent unless the context requires otherwise.
Section 6.08. Access to List of Registered Certificateholders' Names
and Addresses. The Trustee will furnish or cause to be furnished by the Transfer
Agent and Registrar to the Servicer or the Paying Agent, within five Business
Days after receipt by the Trustee of a request therefor, a list in such form as
the Servicer or the Paying Agent may reasonably require, of the names and
addresses of the Registered Certificateholders. If any Holder or group of
Holders of Investor Certificates of any Series or all outstanding Series, as the
case may be, evidencing not less than 10% of the aggregate unpaid principal
amount of such Series or all outstanding Series, as applicable (the
"Applicants"), apply to the Trustee, and such application states that the
Applicants desire to communicate with other Investor Certificateholders with
respect to their rights under this Agreement or any Supplement or under the
Investor Certificates and is accompanied by a copy of the communication which
such Applicants propose to transmit, then the Trustee, after having been
adequately indemnified by such Applicants for its costs and expenses, shall
afford or shall cause the Transfer Agent and Registrar to afford such Applicants
access during normal business hours to the most recent list of Registered
Certificateholders of such Series or all outstanding Series, as applicable, held
by the Trustee, within five Business Days after the receipt of such application.
Such list shall be as of a date no more than 45 days prior to the date of
receipt of such Applicants' request.
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Every Registered Certificateholder, by receiving and holding a
Registered Certificate, agrees with the Trustee that neither the Trustee, the
Transfer Agent and Registrar, nor any of their respective agents, shall be held
accountable by reason of the disclosure of any such information as to the names
and addresses of the Registered Certificateholders hereunder, regardless of the
sources from which such information was derived.
Section 6.09. Authenticating Agent. (a) The Trustee may appoint one
or more authenticating agents with respect to the Certificates which shall be
authorized to act on behalf of the Trustee in authenticating the Certificates in
connection with the issuance, delivery, registration of transfer, exchange or
repayment of the Certificates. Whenever reference is made in this Agreement to
the authentication of Certificates by the Trustee or the Trustee's certificate
of authentication, such reference shall be deemed to include authentication on
behalf of the Trustee by an authenticating agent and certificate of
authentication executed on behalf of the Trustee by an authenticating agent.
Each authenticating agent must be acceptable to the Transferor and the Servicer.
(b) Any institution succeeding to the corporate agency business of
an authenticating agent shall continue to be an authenticating agent without the
execution or filing of any power or any further act on the part of the Trustee
or such authenticating agent. An authenticating agent may at any time resign by
giving notice of resignation to the Trustee and to the Transferor. The Trustee
may at any time terminate the agency of an authenticating agent by giving notice
of termination to such authenticating agent and to the Transferor. Upon
receiving such a notice of resignation or upon such a termination, or in case at
any time an authenticating agent shall cease to be acceptable to the Trustee or
the Transferor, the Trustee promptly may appoint a successor authenticating
agent. Any successor authenticating agent upon acceptance of its appointment
hereunder shall become vested with all the rights, powers and duties of its
predecessor hereunder, with like effect as if originally named as an
authenticating agent. No successor authenticating agent shall be appointed
unless acceptable to the Trustee and the Transferor. The Transferor agrees to
pay to each authenticating agent from time to time reasonable compensation for
its services under this Section. The provisions of Sections 11.01, 11.02 and
11.03 shall be applicable to any authenticating agent.
(c) Pursuant to an appointment made under this Section, the
Certificates may have endorsed thereon, in lieu of the Trustee's certificate of
authentication, an alternate certificate of authentication in substantially the
following form:
This is one of the Certificates described in the Pooling and Servicing
Agreement.
----------------------------
----------------------------
as Authenticating Agent
for the Trustee,
by
----------------------------
Authorized Officer
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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 or
word-processing system produced Investor Certificates representing the
Book-Entry Certificates, to be delivered to the Clearing Agency, by, or on
behalf of, the Transferor. The Investor Certificates shall initially be
registered on the Certificate Register in the name of the Clearing Agency or its
nominee, and no Certificate Owner will receive a definitive certificate
representing such Certificate Owner's interest in the Investor Certificates,
except as provided in Section 6.12. Unless and until definitive, fully
registered Investor Certificates ("Definitive Certificates") have been issued to
the applicable Certificate Owners pursuant to Section 6.12 or as otherwise
specified in any such Supplement:
(a) the provisions of this Section shall be in full force and
effect;
(b) the Transferor, the Servicer and the Trustee may deal with the
Clearing Agency and the Clearing Agency Participants for all purposes (including
the making of distributions) as the authorized representatives of the respective
Certificate Owners;
(c) to the extent that the provisions of this Section conflict with
any other provisions of this Agreement, the provisions of this Section shall
control; and
(d) the rights of the respective Certificate Owners shall be
exercised only through the Clearing Agency and the Clearing Agency Participants
and shall be limited to those established by law and agreements between such
Certificate Owners and the Clearing Agency or the Clearing Agency Participants.
Pursuant to the Depository Agreement, unless and until Definitive Certificates
are issued pursuant to Section 6.12, the Clearing Agency will make book-entry
transfers among the Clearing Agency Participants and receive and transmit
distributions of principal and interest on the related Investor Certificates to
such Clearing Agency Participants.
For purposes of any provision of this Agreement requiring or
permitting actions with the consent of, or at the direction of, Investor
Certificateholders evidencing a specified percentage of the aggregate unpaid
principal amount of Investor Certificates, such direction or consent may be
given by Certificate Owners (acting through the Clearing Agency and the Clearing
Agency Participants) owning Investor Certificates evidencing the requisite
percentage of principal amount of Investor Certificates.
Section 6.11. Notices to Clearing Agency. Whenever any notice or
other communication is required to be given to Investor Certificateholders of
any Series or Class with respect to which Book-Entry Certificates have been
issued, unless and until Definitive Certificates shall have been issued to the
related Certificate Owners, the Trustee shall give all such notices and
communications to the applicable Clearing Agency.
Section 6.12. Definitive Certificates. If Book-Entry Certificates
have been issued with respect to any Series or Class and (a) the Transferor
advises the Trustee in writing that the Clearing Agency is no longer willing or
able to discharge properly its responsibilities under the Depository Agreement
with respect to such Series or Class and the Trustee or the Transferor are
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unable to locate a qualified successor, (b) the Transferor, at its option,
advises the Trustee that it elects to terminate the book-entry system with
respect to such Series or Class through the Clearing Agency or (c) after the
occurrence of a Servicer Default, Certificate Owners of such Series or Class
evidencing more than 50% of the aggregate unpaid principal amount of such Series
or Class advise the Trustee and the Clearing Agency through the Clearing Agency
Participants that the continuation of a book-entry system with respect to the
Investor Certificates of such Series or Class through the Clearing Agency is no
longer in the best interests of the Certificate Owners with respect to such
Certificates, then the Trustee shall notify all Certificate Owners of such
Certificates, through the Clearing Agency, of the occurrence of any such event
and of the availability of Definitive Certificates to Certificate Owners
requesting the same. Upon surrender to the Trustee of any such Certificates by
the Clearing Agency, accompanied by registration instructions from the Clearing
Agency for registration, the Transferor shall execute and the Trustee shall
authenticate and deliver such Definitive Certificates. Neither the Transferor
nor the Trustee shall be liable for any delay in delivery of such instructions
and may conclusively rely on, and shall be protected in relying on, such
instructions. Upon the issuance of such Definitive Certificates, all references
herein to obligations imposed upon or to be performed by the Clearing Agency
shall be deemed to be imposed upon and performed by the Trustee, to the extent
applicable with respect to such Definitive Certificates, and the Trustee shall
recognize the Holders of such Definitive Certificates as Investor
Certificateholders hereunder.
Section 6.13. Global Certificate; Exchange Date.
(a) If specified in the related Supplement for any Series or Class,
the Investor Certificates for such Series or Class will initially be issued in
the form of a single temporary global Certificate (the "Global Certificate") in
bearer form, without interest coupons, in the denomination of the entire
aggregate principal amount of such Series or Class and substantially in the form
set forth in the exhibit with respect thereto attached to the related
Supplement. The Global Certificate will be executed by the Transferor and
authenticated by the Trustee upon the same conditions, in substantially the same
manner and with the same effect as the Definitive Certificates. The Global
Certificate may be exchanged as described below for Bearer or Registered
Certificates in definitive form (the "Definitive Euro-Certificates").
(b) The Manager shall, upon its determination of the date of
completion of the distribution of the Investor Certificates of such Series or
Class, so advise the Trustee, the Transferor, the Depositaries, and each Foreign
Clearing Agency forthwith. Without unnecessary delay, but in any event not prior
to the Exchange Date, the Transferor will execute and deliver to the Trustee at
its London office or its designated agent outside the United States definitive
Bearer Certificates in an aggregate principal amount equal to the entire
aggregate principal amount of such Series or Class. All Bearer Certificates so
issued and delivered will have Coupons attached. The Global Certificate may be
exchanged for an equal aggregate principal amount of Definitive
Euro-Certificates only on or after the Exchange Date. An institutional investor
that is a U.S. Person may exchange the portion of the Global Certificate
beneficially owned by it only for an equal aggregate principal amount of
Registered Certificates bearing the applicable legend set forth in the form of
Registered Certificates attached to the related Supplement and having a minimum
denomination of $500,000, which may be in temporary form if the Transferor so
elects. The Transferor may waive the $500,000 minimum denomination
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requirement if it so elects. Upon any demand for exchange for Definitive
Euro-Certificates in accordance with this paragraph, the Transferor shall cause
the Trustee to authenticate and deliver the Definitive Euro-Certificates to the
Holder (x) outside the United States, in the case of Bearer Certificates, and
(y) according to the instructions of the Holder, in the case of Registered
Certificates, but in either case only upon presentation to the Trustee of a
written statement substantially in the form of Exhibit F-1 with respect to the
Global Certificate or portion thereof being exchanged, signed by a Foreign
Clearing Agency and dated on the Exchange Date or a subsequent date, to the
effect that it has received in writing or by tested telex a certification
substantially in the form of (i) in the case of beneficial ownership of the
Global Certificate or a portion thereof being exchanged by a United States
institutional investor pursuant to the second preceding sentence, the
certificate in the form of Exhibit F-2 signed by the Manager which sold the
relevant Certificates or (ii) in all other cases, the certificate in the form of
Exhibit F-3, the certificate referred to in this clause (ii) being dated on the
earlier of the first actual payment of interest in respect of such Certificates
and the date of the delivery of such Certificate in definitive form. Upon
receipt of such certification, the Trustee shall cause the Global Certificate to
be endorsed in accordance with paragraph (d) below. Any exchange as provided in
this Section shall be made free of charge to the Holders and the beneficial
owners of the Global Certificate and to the beneficial owners of the Definitive
Euro-Certificates issued in exchange, except that a person receiving Definitive
Euro-Certificates must bear the cost of insurance, postage, transportation and
the like in the event that such person does not receive such Definitive
Euro-Certificates in person at the offices of a Foreign Clearing Agency.
(c) The delivery to the Trustee by a Foreign Clearing Agency of any
written statement referred to above may be relied upon by the Transferor and the
Trustee as conclusive evidence that a corresponding certification or
certifications has or have been delivered to such Foreign Clearing Agency
pursuant to the terms of this Agreement.
(d) Upon any such exchange of all or a portion of the Global
Certificate for a Definitive Euro-Certificate or Certificates, such Global
Certificate shall be endorsed by or on behalf of the Trustee to reflect the
reduction of its principal amount by an amount equal to the aggregate principal
amount of such Definitive Euro-Certificate or Certificates. Until so exchanged
in full, such Global Certificate shall in all respects be entitled to the same
benefits under this Agreement as Definitive Euro-Certificates authenticated and
delivered hereunder except that the beneficial owners of such Global Certificate
shall not be entitled to receive payments of interest on the Certificates until
they have exchanged their beneficial interests in such Global Certificate for
Definitive Euro-Certificates.
Section 6.14. Meetings of Certificateholders.
(a) If at the time any Bearer Certificates are issued and
outstanding with respect to any Series or Class to which any meeting described
below relates, the Servicer or the Trustee may at any time call a meeting of
Investor Certificateholders of any Series or Class or of all Series, to be held
at such time and at such place as the Servicer or the Trustee, as the case may
be, shall determine, for the purpose of approving a modification of or amendment
to, or obtaining a waiver of any covenant or condition set forth in, this
Agreement, any Supplement or the Investor Certificates or of taking any other
action permitted to be taken by Investor Certificateholders hereunder or under
any Supplement. Notice of any meeting of Investor
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Certificateholders, setting forth the time and place of such meeting and in
general terms the action proposed to be taken at such meeting, shall be given in
accordance with Section 13.05, the first mailing and publication to be not less
than 20 nor more than 180 days prior to the date fixed for the meeting. To be
entitled to vote at any meeting of Investor Certificateholders a person shall be
(i) a Holder of one or more Investor Certificates of the applicable Series or
Class or (ii) a person appointed by an instrument in writing as proxy by the
Holder of one or more such Investor Certificates. The only persons who shall be
entitled to be present or to speak at any meeting of Investor Certificateholders
shall be the persons entitled to vote at such meeting and their counsel and any
representatives of the Transferor, the Servicer and the Trustee and their
respective counsel.
(b) At a meeting of Investor Certificateholders, persons entitled to
vote Investor Certificates evidencing a majority of the aggregate unpaid
principal amount of the applicable Series or Class or all outstanding Series, as
the case may be, shall constitute a quorum. No business shall be transacted in
the absence of a quorum, unless a quorum is present when the meeting is called
to order. In the absence of a quorum at any such meeting, the meeting may be
adjourned for a period of not less than 10 days; in the absence of a quorum at
any such meeting, such adjourned meeting may be further adjourned for a period
of not less than 10 days; at the reconvening of any meeting further adjourned
for lack of a quorum, the persons entitled to vote Investor Certificates
evidencing at least 25% of the aggregate unpaid principal amount of the
applicable Series or Class or all outstanding Series, as the case may be, shall
constitute a quorum for the taking of any action set forth in the notice of the
original meeting. Notice of the reconvening of any adjourned meeting shall be
given as provided above except that such notice must be given not less than five
days prior to the date on which the meeting is scheduled to be reconvened.
Notice of the reconvening of an adjourned meeting shall state expressly the
percentage of the aggregate principal amount of the outstanding applicable
Investor Certificates which shall constitute a quorum.
(c) Any Investor Certificateholder who has executed an instrument in
writing appointing a person as proxy shall be deemed to be present for the
purposes of determining a quorum and be deemed to have voted; provided that such
Investor Certificateholder shall be considered as present or voting only with
respect to the matters covered by such instrument in writing. Subject to the
provisions of Section 13.01, any resolution passed or decision taken at any
meeting of Investor Certificateholders duly held in accordance with this Section
shall be binding on all Investor Certificateholders whether or not present or
represented at the meeting.
(d) The holding of Bearer Certificates shall be proved by the
production of such Bearer Certificates or by a certificate, satisfactory to the
Servicer, executed by any bank, trust company or recognized securities dealer,
wherever situated, satisfactory to the Servicer. Each such certificate shall be
dated and shall state that on the date thereof a Bearer Certificate bearing a
specified serial number was deposited with or exhibited to such bank, trust
company or recognized securities dealer by the Person named in such certificate.
Any such certificate may be issued in respect of one or more Bearer Certificates
specified therein. The holding by the Person named in any such certificate of
any Bearer Certificate specified therein shall be presumed to continue for a
period of one year from the date of such certificate unless at the time of any
determination of such holding (i) another certificate bearing a later date
issued in respect of the same Bearer Certificate shall be produced, (ii) the
Bearer Certificate specified in such
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certificate shall be produced by some other Person or (iii) the Bearer
Certificate specified in such certificate shall have ceased to be outstanding.
The appointment of any proxy shall be proved by having the signature of the
Person executing the proxy guaranteed by any bank, trust company or recognized
securities dealer satisfactory to the Trustee.
(e) The Trustee shall appoint a temporary chairman of the meeting. A
permanent chairman and a permanent secretary of the meeting shall be elected by
vote of the Holders of Investor Certificates evidencing a majority of the
aggregate unpaid principal amount of Investor Certificates of the applicable
Series or Class or all outstanding Series, as the case may be, represented at
the meeting. No vote shall be cast or counted at any meeting in respect of any
Investor Certificate challenged as not outstanding and ruled by the chairman of
the meeting to be not outstanding. The chairman of the meeting shall have no
right to vote except as an Investor Certificateholder or proxy. Any meeting of
Investor Certificateholders duly called at which a quorum is present may be
adjourned from time to time, and the meeting may be held as so adjourned without
further notice.
(f) The vote upon any resolution submitted to any meeting of
Investor Certificateholders shall be by written ballot on which shall be
subscribed the signatures of Investor Certificateholders or proxies and on which
shall be inscribed the serial number or numbers of the Investor Certificates
held or represented by them. The permanent chairman of the meeting shall appoint
two inspectors of votes who shall count all votes cast at the meeting for or
against any resolution and who shall make and file with the secretary of the
meeting their verified written reports in duplicate of all votes cast at the
meeting. A record in duplicate of the proceedings of each meeting of Investor
Certificateholders shall be prepared by the secretary of the meeting and there
shall be attached to said record the original reports of the inspectors of votes
on any vote by ballot taken thereat and affidavits by one or more persons having
knowledge of the facts setting forth a copy of the notice of the meeting and
showing that said notice was published as provided above. The record shall be
signed and verified by the permanent chairman and secretary of the meeting and
one of the duplicates shall be delivered to the Servicer and the other to the
Trustee to be preserved by the Trustee, the latter to have attached thereto the
ballots voted at the meeting. Any record so signed and verified shall be
conclusive evidence of the matters therein stated.
Section 6.15. Uncertificated Classes. Notwithstanding anything to
the contrary contained in this Article VI or in Article XII, unless otherwise
specified in any Supplement, any provisions contained in this Article VI and in
Article XII relating to the registration, form, execution, authentication,
delivery, presentation, cancellation and surrender of Certificates shall not be
applicable to any uncertificated Certificates.
[END OF ARTICLE VI]
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ARTICLE VII
Other Matters Relating to the Transferor
Section 7.01. Liability of the Transferor. Each Transferor
(including any Additional Transferors) shall be severally and not jointly liable
for the obligations, covenants, representations and warranties of such
Transferor arising under or related to this Agreement or any Supplement. Each
Transferor shall be liable only to the extent of the obligations specifically
undertaken by it in its capacity as a Transferor.
Section 7.02. Merger or Consolidation of, or Assumption of the
Obligations of, the Transferor.
(a) No Transferor shall consolidate with or merge into any other
corporation or convey or transfer its properties and assets substantially as an
entirety to any Person unless:
(i)(x) the corporation formed by such consolidation or
into which such Transferor is merged or the Person which acquires by
conveyance or transfer the properties and assets of such Transferor
substantially as an entirety shall be, if such Transferor is not the
surviving entity, organized and existing under the laws of the
United States of America or any State or the District of Columbia,
and shall be a savings and loan association, a national banking
association, a bank or other entity which is not subject to Title 11
of the United States Code or is a special purpose corporation whose
powers and activities are limited to substantially the same degree
as provided in the Certificate of Incorporation of CC Credit Card
Corporation and, if such Transferor is not the surviving entity,
shall expressly assume, by an agreement supplemental hereto,
executed and delivered to the Trustee, in form satisfactory to the
Trustee, the performance of every covenant and obligation of such
Transferor hereunder; and (y) such Transferor or the surviving
entity as the case may be has delivered to the Trustee (with a copy
to each Rating Agency) an Officer's Certificate and an Opinion of
Counsel each stating that such consolidation, merger, conveyance or
transfer and such supplemental agreement comply with this Section,
that such supplemental agreement is a valid and binding obligation
of such surviving entity enforceable against such surviving entity
in accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors' rights
generally from time to time in effect or general principles of
equity (whether considered in a suit at law or in equity), and that
all conditions precedent herein provided for relating to such
transaction have been complied with;
(ii) the Rating Agency Condition shall have been
satisfied with respect to such consolidation, merger, conveyance or
transfer; and
(iii) if any Series of Investor Certificates are
outstanding that were characterized as debt at the time of their
issuance, the relevant Transferor shall
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have delivered to the Trustee and each Rating Agency a Tax Opinion,
dated the date of such consolidation, merger, conveyance or
transfer, with respect thereto.
(b) The obligations, of the Transferor hereunder shall not be
assignable nor shall any Person succeed to such obligations or rights of the
Transferor hereunder except in each case in accordance with the provisions of
the foregoing paragraph.
Section 7.03. Limitations on Liability of the Transferor. Subject to
Section 7.01, neither the Transferor nor any of its directors, officers,
employees, incorporators or agents acting in such capacities shall be under any
liability to the Trust, the Trustee, the Certificateholders, the Certificate
Owners, any Series Enhancer, any other Transferor or any other Person for any
action taken or for refraining from the taking of any action in good faith in
such capacities pursuant to this Agreement, it being expressly understood that
such liability is expressly waived and released as a condition of, and
consideration for, the execution of this Agreement and any Supplement and the
issuance of the Certificates; provided, however, that this provision shall not
protect any Transferor or any such Person against any liability which would
otherwise be imposed by reason of willful misfeasance, bad faith or gross
negligence in the performance of duties or by reason of reckless disregard of
obligations and duties hereunder. Each Transferor and any director, officer,
employee or agent of such Transferor may rely in good faith on any document of
any kind prima facie properly executed and submitted by any Person (other than
such Transferor) respecting any matters arising hereunder.
[END OF ARTICLE VII]
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ARTICLE VIII
Other Matters Relating to the Servicer
Section 8.01. Liability of the Servicer. The Servicer shall be
liable under this Article only to the extent of the obligations specifically
undertaken by the Servicer in its capacity as Servicer.
Section 8.02. Merger or Consolidation of, or Assumption of the
Obligations of, the Servicer. The Servicer shall not consolidate with or merge
into any other corporation or convey or transfer its properties and assets
substantially as an entirety to any Person, unless:
(a) (i) the corporation formed by such consolidation or
into which the Servicer is merged or the Person which acquires by
conveyance or transfer the properties and assets of the Servicer
substantially as an entirety shall be, if the Servicer is not the
surviving entity, a corporation organized and existing under the
laws of the United States of America or any State or the District of
Columbia and, if the Servicer is not the surviving entity, such
corporation shall expressly assume, by an agreement supplemental
hereto, executed and delivered to the Trustee, in form satisfactory
to the Trustee, the performance of every covenant and obligation of
the Servicer hereunder;
(ii) the Servicer has delivered to the Trustee an
Officer's Certificate and an Opinion of Counsel each stating that
such consolidation, merger, conveyance or transfer and such
supplemental agreement comply with this Section, that such
supplemental agreement is a valid and binding obligation of such
surviving entity enforceable against such surviving entity in
accordance with its terms, except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting creditors' rights
generally from time to time in effect and except as such
enforceability may be limited by general principles of equity
(whether considered in a suit at law or in equity), and that all
conditions precedent herein provided for relating to such
transaction have been complied with;
(b) the Rating Agency Condition shall have been satisfied with
respect to such assignment and succession; and
(c) the corporation formed by such consolidation or into which the
Servicer is merged or the Person which acquires by conveyance or transfer the
properties and assets of the Servicer substantially as an entirety shall be an
Eligible Servicer.
Section 8.03. Limitation on Liability of the Servicer and Others.
Except as provided in Section 8.04, neither the Servicer nor any of the
directors, officers, employees or agents of the Servicer in its capacity as
Servicer shall be under any liability to the Trust, the Trustee, the
Certificateholders, any Series Enhancer or any other Person for any action taken
or for refraining from the taking of any action in good faith in its capacity as
Servicer pursuant to this Agreement; provided, however, that this provision
shall not protect the Servicer or any
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such Person against any liability which would otherwise be imposed by reason of
willful misfeasance, bad faith or gross negligence in the performance of duties
or by reason of reckless disregard of obligations and duties hereunder. The
Servicer and any director, officer, employee or agent of the Servicer may rely
in good faith on any document of any kind prima facie properly executed and
submitted by any Person (other than the Servicer) respecting any matters arising
hereunder. The Servicer shall not be under any obligation to appear in,
prosecute or defend any legal action which is not incidental to its duties as
Servicer in accordance with this Agreement and which in its reasonable judgment
may involve it in any expense or liability. The Servicer may, in its sole
discretion, undertake any such legal action which it may deem necessary or
desirable for the benefit of the Certificateholders with respect to this
Agreement and the rights and duties of the parties hereto and the interests of
the Certificateholders hereunder.
Section 8.04. Servicer Indemnification of the Trust and the Trustee.
The Servicer shall indemnify and hold harmless the Trust and the Trustee from
and against any loss, liability, expense, damage or injury suffered or sustained
by reason of (a) any acts or omissions of the Servicer with respect to the Trust
pursuant to this Agreement or (b) the administration by the Trustee of the
Trust, 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, however, that the Servicer shall not
indemnify the Trustee if such acts, omissions or alleged acts or omissions
constitute or are caused by fraud, negligence, or willful misconduct by the
Trustee; provided further, that the Servicer shall not indemnify the Trust, the
Investor Certificateholders or the Certificate Owners for any liabilities, costs
or expenses of the Trust with respect to any action taken by the Trustee at the
request of the Investor Certificateholders; provided further, that the Servicer
shall not indemnify the Trust, the Investor Certificateholders or the
Certificate Owners as to any losses, claims or damages incurred by any of them
in their capacities as investors, including without limitation losses incurred
as a result of Defaulted Receivables; and provided further, that the Servicer
shall not indemnify the Trust, the Investor Certificateholders or the
Certificate Owners for any liabilities, costs or expenses of the Trust, the
Investor Certificateholders or the Certificate Owners arising under any tax law,
including without limitation, any Federal, state, local or foreign income or
franchise taxes or any other tax imposed on or measured by income (or any
interest or penalties with respect thereto or arising from a failure to comply
therewith) required to be paid by the Trust, the Investor Certificateholders or
the Certificate Owners in connection herewith to any taxing authority.
Indemnification pursuant to this Section shall not be payable from the Trust
Assets. The provisions of this indemnity shall run directly to and be
enforceable by an injured party subject to the limitations hereof.
Section 8.05. The Servicer Not To Resign. The Servicer shall not
resign from the obligations and duties hereby imposed on it except upon
determination that (i) the performance of its duties hereunder is no longer
permissible under any Requirement of Law and (ii) there is no reasonable action
which the Servicer could take to make the performance of its duties hereunder
permissible under any such Requirements of Law. Any determination permitting the
resignation of the Servicer shall be evidenced by an Opinion of Counsel to such
effect delivered to the Trustee. No resignation shall become effective until the
Trustee or a Successor Servicer shall have assumed the responsibilities and
obligations of the Servicer in accordance with Section 10.02. If within 120 days
of the date of the determination that the
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Servicer may no longer act as Servicer the Trustee is unable to appoint a
Successor Servicer, the Trustee shall serve as Successor Servicer.
Notwithstanding the foregoing, the Trustee shall, if it is legally unable so to
act, petition a court of competent jurisdiction to appoint any established
institution that is an Eligible Servicer as the Successor Servicer hereunder.
The Trustee shall give prompt notice to each Rating Agency upon the appointment
of a Successor Servicer.
Section 8.06. Access to Certain Documentation and Information
Regarding the Receivables. The Servicer shall provide to the Trustee access to
the documentation regarding the Accounts and the Receivables in such cases where
the Trustee is required in connection with the enforcement of the rights of
Certificateholders or by applicable statutes or regulations to review such
documentation, such access being afforded without charge but only (a) upon
reasonable request, (b) during normal business hours, (c) subject to the
Servicer's normal security and confidentiality procedures and (d) at reasonably
accessible offices in the continental United States designated by the Servicer.
Nothing in this Section shall derogate from the obligation of the Transferor,
the Trustee and the Servicer to observe any applicable law prohibiting
disclosure of information regarding the Obligors and the failure of the Servicer
to provide access as provided in this Section as a result of such obligation
shall not constitute a breach of this Section.
Section 8.07. Delegation of Duties. In the ordinary course of
business, the Servicer may at any time delegate any duties hereunder to any
Person who agrees to conduct such duties in accordance with the Credit Card
Guidelines and this Agreement; provided, however, in the case of significant
delegation to a Person other than to an Account Owner or any Affiliate of an
Account Owner, (i) at least 30 days prior written notice shall be given to the
Trustee and each Rating Agency of such delegation and (ii) at or prior to the
end of such 30-day period the Servicer shall have determined that the Rating
Agency Condition has been met. Any such delegations shall not relieve the
Servicer of its liability and responsibility with respect to such duties, and
shall not constitute a resignation within the meaning of Section 8.05.
Section 8.08. Examination of Records. The Servicer shall clearly and
unambiguously indicate in its computer files or other records that the
Receivables arising in the Accounts have been conveyed to the Trustee, on behalf
of the Trust, pursuant to this Agreement for the benefit of the
Certificateholders. The Servicer shall, prior to the sale or transfer to a third
party of any receivable held in its custody, examine its computer and other
records to determine that such receivable is not a Receivable.
[END OF ARTICLE VIII]
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ARTICLE IX
Pay Out Events
Section 9.01. Trust Pay Out Events. If any one of the following
events shall occur with respect to the Trust ("Trust Pay Out Events"):
(i) any Transferor or any of the Account Owners shall
consent to the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshaling of
assets and liabilities or similar proceedings of or relating to such
Transferor or Account Owner or of or relating to all or
substantially all of its property, or a decree or order of a court
or agency or supervisory authority having jurisdiction in the
premises for the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshaling of
assets and liabilities or similar proceedings, or for the winding-up
or liquidation of its affairs, shall have been entered against such
Transferor or Account Owner; or any Transferor or Account Owner
shall admit in writing its inability to pay its debts generally as
they become due, file a petition to take advantage of any applicable
insolvency or reorganization statute, make any assignment for the
benefit of its creditors or voluntarily suspend payment of its
obligations (any such event, an "Insolvency Event");
(ii) the Trust shall become subject to regulation by the
Commission as an "investment company" within the meaning of the
Investment Company Act; or
(iii) a Transfer Restriction Event shall occur;
then, a Trust Pay Out Event shall occur with respect to each Series without any
notice or other action on the part of the Trustee or the Investor
Certificateholders, immediately upon the occurrence of such event.
Section 9.02. Rights Upon the Occurrence of an Insolvency Event. If
the Transferor causes an Insolvency Event to occur with respect to the
Transferor or an Account Owner or if an Insolvency Event otherwise occurs with
respect to the Transferor or an Account Owner, the Transferor shall on the day
any such Insolvency Event occurs immediately cease to transfer Principal
Receivables to the Trust and shall promptly give notice to the Trustee thereof.
Notwithstanding any cessation of the transfer to the Trust of additional
Principal Receivables transferred to the Trust 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 a part of the Trust Assets.
[END OF ARTICLE IX]
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ARTICLE X
Servicer Defaults
Section 10.01. Servicer Defaults. If any one of the following events
(a "Servicer Default") shall occur and be continuing:
(a) any failure by the Servicer to make any payment, transfer or
deposit or to give instructions or notice to the Trustee pursuant to the terms
of this Agreement or any Supplement on or before the date occurring five
Business Days after the date such payment, transfer or deposit or such
instruction or notice is required to be made or given, as the case may be, under
the terms of this Agreement or any Supplement;
(b) failure on the part of the Servicer duly to observe or perform
in any material respect any other covenants or agreements of the Servicer set
forth in this Agreement or any Supplement which has a material adverse effect on
the interests hereunder of the Investor Certificateholders of any Series or
Class and which continues unremedied for a period of 60 days after the date on
which written notice of such failure, requiring the same to be remedied, shall
have been given to the Servicer by the Trustee, or to the Servicer and the
Trustee by Holders of Investor Certificates evidencing more than 50% of the
Aggregate Investor Amount (or, with respect to any such failure that does not
relate to all Series, 50% of the aggregate Investor Amount of all Series to
which such failure relates); or the Servicer shall delegate its duties under
this Agreement, except as permitted by Sections 8.02 or 8.07, a Responsible
Officer of the Trustee has actual knowledge of such delegation and such
delegation continues unremedied for 15 days after the date on which written
notice thereof, requiring the same to be remedied, shall have been given to the
Servicer by the Trustee, or to the Servicer and the Trustee by Holders of
Investor Certificates evidencing more than 50% of the Aggregate Investor Amount;
(c) any representation, warranty or certification made by the
Servicer in this Agreement or any Supplement or in any certificate delivered
pursuant to this Agreement or any Supplement shall prove to have been incorrect
when made, which has a material adverse effect on the rights of the Investor
Certificateholders of any Series or Class and which continues to be incorrect in
any material respect for a period of 60 days after the date on which written
notice of such failure, requiring the same to be remedied, shall have been given
to the Servicer by the Trustee, or to the Servicer and the Trustee by the
Holders of Investor Certificates evidencing more than 50% of the Aggregate
Investor Amount (or, with respect to any such representation, warranty or
certification that does not relate to all Series, 50% of the aggregate Investor
Amount of all Series to which such representation, warranty or certification
relates); or
(d) the Servicer shall consent to the appointment of a conservator
or receiver or liquidator in any insolvency, readjustment of debt, marshaling of
assets and liabilities or similar proceedings of or relating to the Servicer or
of or relating to all or substantially all of its property, or a decree or order
of a court or agency or supervisory authority having jurisdiction in the
premises for the appointment of a conservator or receiver or liquidator in any
insolvency, readjustment of debt, marshaling of assets and liabilities or
similar proceedings, or for the winding-up or liquidation of its affairs, shall
have been entered against the Servicer, and such decree or order shall have
remained in force undischarged or unstayed for a period of 60 days;
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or the Servicer shall admit in writing its inability to pay its debts generally
as they become due, file a petition to take advantage of any applicable
insolvency or reorganization statute, make any assignment for the benefit of its
creditors or voluntarily suspend payment of its obligations;
then, in the event of any Servicer Default, so long as the Servicer Default
shall not have been remedied, either the Trustee or the Holders of Investor
Certificates evidencing more than 50% of the Aggregate Investor Amount, by
notice then given to the Servicer (and to the Trustee if given by the Investor
Certificateholders) (a "Termination Notice"), may terminate all but not less
than all the rights and obligations of the Servicer as Servicer under this
Agreement and in and to the Receivables and the proceeds thereof; provided,
however, if within 60 days of receipt of a Termination Notice the Trustee does
not receive any bids from Eligible Servicers in accordance with subsection
10.02(c) to act as a Successor Servicer and receives an Officer's Certificate of
the Servicer to the effect that the Servicer cannot in good faith cure the
Servicer Default which gave rise to the Termination Notice, the Trustee shall
offer the Transferor the right at its option to purchase the Certificateholders'
Interest on the Distribution Date next succeeding 60 days after the receipt by
the Servicer of a Termination Notice.
The purchase price for the Certificateholders' Interest shall be
equal to the sum of the amounts specified therefor with respect to each
outstanding Series in the related Supplement. The Transferor shall notify the
Trustee in writing prior to the Record Date for the Distribution Date of the
purchase if it is exercising such option. If the Transferor exercises such
option, the Transferor shall (x) if the Transferor's short-term deposits or
long-term unsecured debt obligations are not rated at the time at least P-3 or
Baa3, respectively, by Moody's, deliver to the Trustee an Opinion of Counsel
(which must be an independent outside counsel) to the effect that, in reliance
on certain certificates to the effect that the Receivables constitute fair value
for consideration paid therefor and as to the solvency of the Transferor, the
purchase would not be considered a fraudulent conveyance and (y) deposit the
purchase price into the Collection Account not later than 12:00 noon, New York
City time, on such Distribution Date in immediately available funds. The
purchase price shall be allocated and distributed to Investor Certificateholders
in accordance with Article IV and the terms of each Supplement.
After receipt by the Servicer of such Termination Notice, and on the
date that a Successor Servicer shall have been appointed by the Trustee pursuant
to Section 10.02, all authority and power of the Servicer under this Agreement
shall pass to and be vested in a Successor Servicer; and, without limitation,
the Trustee is hereby authorized and empowered (upon the failure of the Servicer
to cooperate) to execute and deliver, on behalf of the Servicer, as
attorney-in-fact or otherwise, all documents and other instruments upon the
failure of the Servicer to execute or deliver such documents or instruments, and
to do and accomplish all other acts or things necessary or appropriate to effect
the purposes of such transfer of servicing rights. The Servicer agrees to
cooperate with the Trustee and such Successor Servicer in effecting the
termination of the responsibilities and rights of the Servicer to conduct
servicing hereunder including, without limitation, the transfer to such
Successor Servicer of all authority of the Servicer to service the Receivables
provided for under this Agreement, including, without limitation, all authority
over all Collections which shall on the date of transfer be held by the Servicer
for deposit, or which have been deposited by the Servicer, in the Collection
Account, 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. The Servicer shall
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promptly transfer its electronic records relating to the Receivables to the
Successor Servicer in such electronic form as the Successor Servicer may
reasonably request and shall promptly transfer to the Successor Servicer all
other records, correspondence and documents necessary for the continued
servicing of the Receivables in the manner and at such times as the Successor
Servicer shall reasonably request. To the extent that compliance with this
Section 10.01 shall require the Servicer to disclose to the Successor Servicer
information of any kind which the Servicer reasonably deems to be confidential,
the Successor Servicer shall be required to enter into such customary licensing
and confidentiality agreements as the Servicer shall deem necessary to protect
its interests.
Notwithstanding the foregoing, any delay in or failure of
performance under subsection 10.01(a) for a period of 5 Business Days or under
subsections 10.01(b) or (c) for a period of 60 days (in addition to any period
provided in subsections 10.01(a), (b) or (c)) shall not constitute a Servicer
Default until the expiration of such additional 5 Business Days or 60 days,
respectively, if such delay or failure could not be prevented by the exercise of
reasonable diligence by the Servicer and such delay or failure was caused by an
act of God or the public enemy, acts of declared or undeclared war, terrorism,
public disorder, rebellion or sabotage, epidemics, landslides, lightning, fire,
hurricanes, earthquakes, floods or similar causes. The preceding sentence shall
not relieve the Servicer from using its best efforts to perform its respective
obligations in a timely manner in accordance with the terms of this Agreement
and any Supplement and the Servicer shall provide the Trustee, each Rating
Agency, the Holders of the Transferor Certificates and the Investor
Certificateholders with an Officer's Certificate giving prompt notice of such
failure or delay by it, together with a description of its efforts to so perform
its obligations.
Section 10.02. Trustee To Act, Appointment of Successor.
(a) On and after the receipt by the Servicer of a Termination Notice
pursuant to Section 10.01, the Servicer shall continue to perform all servicing
functions under this Agreement until the date specified in the Termination
Notice or otherwise specified by the Trustee or until a date mutually agreed
upon by the Servicer and Trustee. The Trustee shall as promptly as possible
after the giving of a Termination Notice appoint an Eligible Servicer as a
successor servicer (the "Successor Servicer"), and such Successor Servicer shall
accept its appointment by a written assumption in a form acceptable to the
Trustee. In the event that a Successor Servicer has not been appointed or has
not accepted its appointment at the time when the Servicer ceases to act as
Servicer, the Trustee without further action shall automatically be appointed
the Successor Servicer. The Trustee may delegate any of its servicing
obligations to an Affiliate of the Trustee or agent in accordance with Sections
3.01(b) and 8.07. Notwithstanding the foregoing, the Trustee shall, if it is
legally unable so to act, petition a court of competent jurisdiction to appoint
any established institution qualifying as an Eligible Servicer as the Successor
Servicer hereunder. The Trustee shall give prompt notice to each Rating Agency
upon the appointment of a Successor Servicer.
(b) Upon its appointment, the Successor Servicer shall be the
successor to the Servicer with respect to servicing functions under this
Agreement and shall be subject to all the responsibilities, duties and
liabilities relating thereto placed on the Servicer by the terms and
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provisions hereof, and all references in this Agreement to the Servicer shall be
deemed to refer to the Successor Servicer.
(c) In connection with any Termination Notice, the Trustee will
review any bids 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 Holders of the Transferor Certificates shall
be responsible for payment of the Transferor's portion of such aggregate
Servicing Fees and that no such monthly compensation paid out of Collections
shall be in excess of such aggregate Servicing Fees. Each Holder of a Transferor
Certificate agrees that, if the Travelers Bank & Trust, fsb (or any Successor
Servicer) is terminated as Servicer hereunder, the portion of the Collections in
respect of Finance Charge Receivables that such Holders are entitled to receive
pursuant to this Agreement or any Supplement shall be reduced by an amount
sufficient to pay such Holders' share (determined by reference to the
Supplements with respect to any outstanding Series) of the compensation of the
Successor Servicer.
(d) All authority and power granted to the Successor Servicer under
this Agreement shall automatically cease and terminate upon termination of the
Trust pursuant to Section 12.01 and shall pass to and be vested in the
Transferor and, without limitation, the 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 the 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 the Transferor in such electronic form as the
Transferor may reasonably request and shall transfer all other records,
correspondence and documents to the Transferor in the manner and at such times
as the Transferor shall reasonably request. To the extent that compliance with
this Section 10.02 shall require the Successor Servicer to disclose to the
Transferor information of any kind which the Successor Servicer deems to be
confidential, the 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 10.03. Notification to Certificateholders. Within two
Business Days after the Servicer becomes aware of any Servicer Default, the
Servicer shall give notice thereof to the Trustee and each Rating Agency and the
Trustee shall give notice to the Investor Certificateholders. Upon any
termination or appointment of a Successor Servicer pursuant to this Article, the
Trustee shall give prompt notice thereof to the Investor Certificateholders.
[END OF ARTICLE X]
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ARTICLE XI
The Trustee
Section 11.01. Duties of Trustee.
(a) The Trustee, prior to the occurrence of a Servicer Default and
after the curing of all Servicer Defaults which may have occurred, undertakes to
perform such duties and only such duties as are specifically set forth in this
Agreement. If a Responsible Officer has received written notice that a Servicer
Default has occurred (which has not been cured or waived) the Trustee shall
exercise such of the rights and powers vested in it by this Agreement, and use
the same degree of care and skill in its exercise, as a prudent person would
exercise or use under the circumstances in the conduct of such person's own
affairs.
(b) The Trustee, upon receipt of all resolutions, certificates,
statements, opinions, reports, documents, orders or other instruments furnished
to the Trustee that are specifically required to be furnished pursuant to any
provision of this Agreement, shall examine them to determine whether they
substantially conform to the requirements of this Agreement.
(c) Subject to subsection 11.01(a), no provision of this Agreement
shall be construed to relieve the Trustee from liability for its own negligent
action, its own negligent failure to act or its own misconduct; provided,
however, that:
(i) the Trustee shall not be personally liable for an
error of judgment made in good faith by a Responsible Officer or
Responsible Officers of the Trustee, unless it shall be proved that
the Trustee was negligent in ascertaining the pertinent facts;
(ii) the Trustee shall not be personally liable with
respect to any action taken, suffered or omitted to be taken by it
in good faith in accordance with the direction of the Holders of
Investor Certificates evidencing more than 50% of the Investor
Amount of any Series relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee,
or exercising any trust or power conferred upon the Trustee in
relation to such Series, under this Agreement; and
(iii) the Trustee shall not be charged with knowledge of
any failure by the Servicer referred to in clauses (a) and (b) of
Section 10.01 unless a Responsible Officer of the Trustee obtains
actual knowledge of such failure or the Trustee receives written
notice of such failure from the Servicer or any Holders of Investor
Certificates evidencing not less than 10% of the Investor Amount of
any Series adversely affected thereby.
(d) The Trustee shall not be required to expend or risk its own
funds or otherwise incur financial liability in the performance of any of its
duties hereunder or in the exercise of any of its rights or powers, if there is
reasonable ground for believing that the repayment of such funds or adequate
indemnity against such risk or liability is not reasonably
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assured to it, and none of the provisions contained in this Agreement shall in
any event require the Trustee to perform, or be responsible for the manner of
performance of, any of the obligations of the Servicer under this Agreement
except during such time, if any, as the Trustee shall be the successor to, and
be vested with the rights, duties, powers and privileges of, the Servicer in
accordance with the terms of this Agreement.
(e) Except for actions expressly authorized by this Agreement, the
Trustee shall take no action reasonably likely to (i) impair the interests of
the Trust in any Receivable now existing or hereafter created or (ii) impair the
value of any Receivable now existing or hereafter created.
(f) The Trustee shall have no power to vary the corpus of the Trust,
except as expressly provided in this Agreement.
(g) In the event that the Paying Agent or the Transfer Agent and
Registrar shall fail to perform any obligation, duty or agreement in the manner
or on the day required to be performed by the Paying Agent or the Transfer Agent
and Registrar, as the case may be, under this Agreement, the Trustee shall be
obligated as soon as possible upon actual 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.
(h) If the Transferor has agreed to transfer any of its consumer
revolving credit card receivables (other than the Receivables) to another
Person, upon the written request of the Transferor, the Trustee will enter into
such intercreditor agreements with the transferee of such receivables as are
customary and necessary to separately identify the rights, if any, of the Trust
and such other Person in the Transferor's consumer revolving credit card
receivables; provided, that the Trustee shall not be required to enter into any
intercreditor agreement which could adversely affect the interests of the
Certificateholders and, upon the request of the Trustee, the Transferor will
deliver an Opinion of Counsel on any matters relating to such intercreditor
agreement, reasonably requested by the Trustee.
Section 11.02. Certain Matters Affecting the Trustee. Except as
otherwise provided in Section 11.01:
(a) the Trustee may conclusively rely on and shall be protected in
acting on, or in refraining from acting in accord with, any Assignment, the
initial report, the annual Servicer's certificate, the monthly payment
instructions and notification to the Trustee, the monthly Certificateholder's
statement, any resolution, Officer's Certificate, certificate of auditors or any
other certificate, statement, instrument, opinion, report, notice, request,
consent, order, appraisal, bond or other paper or document believed by it to be
genuine and to have been signed or presented to it pursuant to this Agreement by
the proper party or parties;
(b) the Trustee may consult with counsel of its selection, and any
advice 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;
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(c) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Agreement or any Enhancement Agreement, or
to institute, conduct or defend any litigation hereunder or in relation hereto,
at the request, order or direction of any of the Certificateholders, or any
Enhancement Provider, pursuant to the provisions of this Agreement or any
Enhancement Agreement, unless such Certificateholders or any Enhancement
Provider shall have offered to the Trustee reasonable security or indemnity
against the costs, expenses and liabilities which may be incurred therein or
thereby; nothing contained herein shall, however, relieve the Trustee of the
obligations, upon the occurrence of any Servicer Default (which has not been
cured), to exercise such of the rights and powers vested in it by this Agreement
and any Series Enhancement, and to use the same degree of care and skill in its
exercise as a prudent person would exercise or use under the circumstances in
the conduct of person's own affairs;
(d) the Trustee shall not be personally liable for any action taken,
suffered or omitted by it in good faith and believed by it to be authorized or
within the discretion or rights or powers conferred upon it by this Agreement;
(e) the Trustee shall not be bound to make any investigation into
the facts of matters stated in any Assignment, the initial report, the annual
Servicer's certificate, the monthly payment instructions and notification to the
Trustee, the monthly Certificateholder's statement, any resolution, certificate,
statement, instrument, opinion, report, notice, request, consent, order,
approval, bond or other paper or document, unless requested in writing so to do
by Holders of Investor Certificates evidencing more than 50% of the Investor
Amount of any Series which could be adversely affected if the Trustee does not
perform such acts;
(f) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys or a custodian, and the Trustee shall not be responsible for any
misconduct or negligence on the part of any such agent, attorney or custodian
appointed with due care by it hereunder; the Trustee shall notify the Rating
Agencies of the appointment of any such agent, attorney or custodian; and
(g) except as may be required by subsection 11.01(a) hereof, the
Trustee shall not be required to make any initial or periodic examination of any
documents or records related to the Receivables or the Accounts for the purpose
of establishing the presence or absence of defects, the compliance by the
Transferor with its representations and warranties or for any other purpose.
Section 11.03. Trustee Not Liable for Recitals in Certificates. The
Trustee assumes no responsibility for the correctness of the recitals contained
herein and in the certificates (other than the certificate of authentication on
the Certificates). Except as set forth in Section 11.15, the Trustee makes no
representations as to the validity or sufficiency of this Agreement or any
Supplement or of the Certificates (other than the certificate of authentication
on the Certificates) or of any Receivable or related document. The Trustee shall
not be accountable for the use or application by the Transferor of any of the
Certificates or of the proceeds of such Certificates, or for the use or
application of any funds paid to the Transferor or the Holders of the Transferor
Certificates in respect of the Receivables or deposited in or
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withdrawn from the Collection Account, the Excess Funding Account or any Series
Account by the Servicer.
Section 11.04. Trustee May Own Certificates. Subject to Section
6.06, the Trustee in its individual or any other capacity may become the owner
or pledgee of Investor Certificates or Supplemental Certificates with the same
rights as it would have if it were not the Trustee.
Section 11.05. The Transferor To Pay Trustee's Fees and Expenses.
The Transferor covenants and agrees to pay to the Trustee from time to time, and
the Trustee shall be entitled to receive, reasonable compensation (which shall
not be limited by any provision of law in regard to the compensation of a
trustee of an express trust) for all services rendered by it in the execution of
the trust hereby created and in the exercise and performance of any of the
powers and duties hereunder of the Trustee, and the Transferor will pay or
reimburse the Trustee (without reimbursement from the Collection Account or
otherwise) upon its request for all reasonable expenses, disbursements and
advances (if any) incurred or made by the Trustee (including the fees and
expenses of Trustee's counsel) in accordance with any of the provisions of this
Agreement except any such expense, disbursement or advance as may arise from its
own negligence or bad faith and except as provided in the following sentence. If
the Trustee is appointed Successor Servicer pursuant to Section 10.02, the
provisions of this Section 11.05 shall not apply to expenses, disbursements and
advances made or incurred by the Trustee in its capacity as Successor Servicer.
The obligations of the Transferor under this Section 11.05 shall survive the
termination of the Trust and the resignation or removal of the Trustee.
Section 11.06. Eligibility Requirements for Trustee. The Trustee
hereunder shall at all times be a bank or a corporation organized and doing
business under the laws of the United States of America or any state thereof and
subject to supervision or examination by Federal or state authority and
authorized under such laws to exercise corporate trust powers that either (x)
has a long-term unsecured debt rating of at least Baa3 by Moody's and BBB- by
Standard & Poor's and, in the case of an entity that is subject to risk-based
capital adequacy requirements, risk-based capital of at least $50,000,000 or, in
the case of an entity that is not subject to risk-based capital adequacy
requirements, a combined capital and surplus of at least $50,000,000 or (y)
shall otherwise be acceptable to each Rating Agency. If such bank or corporation
publishes reports of condition at least annually, pursuant to law or to the
requirements of the aforesaid supervising or examining authority, then for the
purpose of this Section 11.06, the combined capital and surplus of such bank or
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. The Trustee shall not be an
Affiliate of the Transferor and shall not provide credit or credit enhancement
to the Transferor or the Trust. In case at any time the Trustee shall cease to
be eligible in accordance with the provisions of this Section 11.06, the Trustee
shall resign immediately in the manner and with the effect specified in Section
11.07.
Section 11.07. Resignation or Removal of Trustee.
(a) The Trustee may at any time resign and be discharged from the
trust hereby created by giving written notice thereof to the Servicer. Upon
receiving such notice of resignation, the Servicer shall promptly appoint a
successor trustee by written instrument, in
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duplicate, one copy of which instrument shall be delivered to the resigning
Trustee and one copy to the successor trustee. If no successor trustee shall
have been so appointed and have accepted within 30 days after the giving of such
notice of resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor trustee.
(b) If at any time the Trustee shall cease to be eligible in
accordance with the provisions of Section 11.06 and shall fail to resign after
written request therefor by the Servicer or the Transferor, or if at any time
the Trustee shall be legally unable to act, or shall be adjudged a bankrupt or
insolvent, or a receiver of the Trustee or of its property shall be appointed,
or any public officer shall take charge or control of the Trustee or of its
property or affairs for the purpose of rehabilitation, conservation or
liquidation, then the Servicer or Transferor may, but shall not be required to,
remove the Trustee and promptly appoint a successor trustee by written
instrument, in duplicate, one copy of which instrument shall be delivered to the
Trustee so removed and one copy to the successor trustee.
(c) Any resignation or removal of the Trustee and appointment of a
successor trustee pursuant to any of the provisions of this Section 11.07 shall
not become effective until acceptance of appointment by the successor trustee as
provided in Section 11.08 and any liability of the Trustee arising hereunder
shall survive such appointment of a successor trustee.
Section 11.08. Successor Trustee.
(a) Any successor trustee appointed as provided in Section 11.07
shall execute, acknowledge and deliver to the Transferor, to the Servicer and to
its predecessor Trustee an instrument accepting such appointment hereunder, and
thereupon the resignation or removal of the predecessor Trustee shall become
effective and such successor trustee, without any further act, deed or
conveyance, shall become fully vested with all the rights, powers, duties and
obligations of its predecessor hereunder, with the like effect as if originally
named as Trustee herein. The predecessor Trustee shall deliver to the successor
trustee all documents and statements held by it hereunder, and the 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 11.08 unless at the time of such acceptance such successor trustee
shall be eligible under the provisions of Section 11.06.
(c) Upon acceptance of appointment by a successor trustee as
provided in this Section 11.08, such successor trustee shall provide notice of
such succession hereunder to all Investor Certificateholders and the Servicer
shall provide such notice to each Rating Agency and any Series Enhancer entitled
thereto pursuant to the relevant Supplement.
Section 11.09. Merger or Consolidation of Trustee. Any Person into
which the Trustee may be merged or converted or with which it may be
consolidated, or any Person resulting from any merger, conversion or
consolidation to which the Trustee shall be a party, or any Person succeeding to
the corporate trust business of the Trustee, shall be the successor
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of the Trustee hereunder, provided such corporation shall be eligible under the
provisions of Section 11.06, without the execution or filing of any paper or any
further act on the part of any of the parties hereto, anything herein to the
contrary notwithstanding.
Section 11.10. Appointment of Co-Trustee or Separate Trustee.
(a) Notwithstanding any other provisions of this Agreement, at any
time, for the purpose of meeting any legal requirements of any jurisdiction in
which any part of the Trust may at the time be located, the Trustee shall have
the power and may execute and deliver all instruments to appoint one or more
Persons to act as a co-trustee or co-trustees, or separate trustee or separate
trustees, of all or any part of the Trust, and to vest in such Person or
Persons, in such capacity and for the benefit of the Certificateholders, such
title to the Trust, or any part thereof, and, subject to the other provisions of
this Section 11.10, such powers, duties, obligations, rights and trusts as the
Trustee may consider necessary or desirable; provided, however, that the Trustee
shall exercise due care in the appointment of any co-trustee. The Trustee shall
notify the Rating Agencies of any such appointment of any such co-trustee. No
co-trustee or separate trustee hereunder shall be required to meet the terms of
eligibility as a successor trustee under Section 11.06 and no notice to
Certificateholders of the appointment of any co-trustee or separate trustee
shall be required under Section 11.08.
(b) Every separate trustee and co-trustee shall, to the extent
permitted by law, be appointed and act subject to the following provisions and
conditions:
(i) all rights, powers, duties and obligations conferred
or imposed upon the Trustee shall be conferred or imposed upon and
exercised or performed by the Trustee and such separate trustee or
co-trustee jointly (it being understood that such separate trustee
or co-trustee is not authorized to act separately without the
Trustee joining in such act) except to the extent that under any
laws of any jurisdiction in which any particular act or acts are to
be performed (whether as Trustee hereunder or as successor to the
Servicer hereunder) the Trustee shall be incompetent or unqualified
to perform such act or acts, in which event such rights, powers,
duties and obligations (including the holding of title to the Trust
or any portion thereof in any such jurisdiction) shall be exercised
and performed singly by such separate trustee or co-trustee, but
solely at the direction of the Trustee;
(ii) no trustee hereunder shall be personally liable by
reason of any act or omission of any other trustee hereunder; and
(iii) the Trustee may at any time accept the resignation
of or remove any separate trustee or co-trustee.
(c) Any notice, request or other writing given to the Trustee shall
be deemed to have been given to each of the then-separate trustees and
co-trustees, as effectively as if given to each of them. Every instrument
appointing any separate trustee or co-trustee shall refer to this Agreement and
the conditions of this Article XI. Each separate trustee and co-trustee, upon
its acceptance of the trusts conferred, shall be vested with the estates or
property specified in
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its instrument of appointment, either jointly with the Trustee or separately, as
may be provided therein, subject to all the provisions of this Agreement,
specifically including every provision of this Agreement relating to the conduct
of, affecting the liability of, or affording protection to, the Trustee. Every
such instrument shall be filed with the Trustee and a copy thereof given to the
Servicer.
(d) Any separate trustee or co-trustee may at any time constitute
the Trustee as 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 the Trustee, to the extent permitted by law, without the
appointment of a new or successor trustee.
Section 11.11. Tax Returns. In the event the Trust shall be required
to file tax returns, the Servicer, as soon as practicable after it is made aware
of such requirement, shall prepare or cause to be prepared any tax returns
required to be filed by the Trust and, to the extent possible, shall file such
returns at least five days before such returns are due to be filed. The Trustee
is hereby authorized to sign any such return on behalf of the Trust. The
Servicer shall prepare or shall cause to be prepared all tax information
required by law to be distributed to Certificateholders and shall deliver such
information to the Trustee at least five days prior to the date it is required
by law to be distributed to Certificateholders. The Servicer, upon request, will
furnish the Trustee with all such information known to the Servicer as may be
reasonably required in connection with the preparation of all tax returns of the
Trust. In no event shall the Trustee or the Servicer be liable for any
liabilities, costs or expenses of the Trust, the Investor Certificateholders or
the Certificate Owners arising under any tax law, including without limitation
federal, state, local or foreign income or excise taxes or any other tax imposed
on or measured by income (or any interest or penalty with respect thereto or
arising from a failure to comply therewith).
Section 11.12. Trustee May Enforce Claims Without Possession of
Certificates. All rights of action and claims under this Agreement or any Series
of Certificates may be prosecuted and enforced by the Trustee without the
possession of any of the Certificates or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee. Any recovery of judgment shall,
after provision for the payment of the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, be for the
ratable benefit of any Series of Certificates in respect of which such judgment
has been obtained.
Section 11.13. Suits for Enforcement.
(a) If a Servicer Default shall occur and be continuing, the
Trustee, in its discretion may, subject to the provisions of Sections 10.01 and
11.14, proceed to protect and enforce its rights and the rights of any Series of
Certificates 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
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as the Trustee, being advised by counsel, shall deem most effectual to protect
and enforce any of the rights of the Trustee or any Series of Certificates.
(b) Nothing herein contained shall be deemed to authorize the
Trustee to authorize or consent to or accept or adopt on behalf of any
Certificateholder any plan of reorganization, arrangement, adjustment or
composition affecting the Certificates or the rights of any Holder thereof, or
to authorize the Trustee to vote in respect of the claim of any
Certificateholder in any such proceeding.
Section 11.14. Rights of Certificateholders To Direct Trustee.
Holders of Investor Certificates evidencing more than 50% of the Aggregate
Investor Amount (or, with respect to any remedy, trust or power that does not
relate to all Series, 50% of the aggregate Investor Amount of all Series to
which such remedy, trust or power relates) shall have the right to direct the
time, method, and place of conducting any proceeding for any remedy available to
the Trustee, or exercising any trust or power conferred on the Trustee;
provided, however, that, subject to Section 11.01, the Trustee shall have the
right to decline to follow any such direction if the Trustee being advised by
counsel determines that the action so directed may not lawfully be taken, or if
the Trustee in good faith shall, by a Responsible Officer or Responsible
Officers of the Trustee, determine that the proceedings so directed would be
illegal or involve it in personal liability or be unduly prejudicial to the
rights of Certificateholders not parties to such direction; and provided
further, that nothing in this Agreement shall impair the right of the Trustee to
take any action deemed proper by the Trustee and which is not inconsistent with
such direction of such Holders of Investor Certificates.
Section 11.15. Representations and Warranties of Trustee. The
Trustee represents and warrants as of each Closing Date that:
(a) the Trustee is a banking corporation organized, existing and
authorized to engage in the business of banking under the laws of the State of
New York.
(b) the Trustee has full power, authority and right to execute,
deliver and perform this Agreement and each Supplement, and has taken all
necessary action to authorize the execution, delivery and performance by it of
this Agreement and each Supplement; and
(c) this Agreement and each Supplement has been duly executed and
delivered by the Trustee.
Section 11.16. Maintenance of Office or Agency. The Trustee will
maintain at its expense an office or agency (the "Corporate Trust Office") where
notices and demands to or upon the Trustee in respect of the Certificates and
this Agreement may be served in the Borough of Manhattan, the City of New York,
in the case of Registered Certificates and Holders thereof. The Corporate Trust
Office shall initially be located at 101 Barclay Street, New York, New York
10286. The Trustee will give prompt notice to the Servicer and to Investor
Certificateholders of any change in the location of the Certificate Register or
any such office or agency.
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[END OF ARTICLE XI]
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ARTICLE XII
Termination
Section 12.01. Termination of Trust. The Trust and the respective
obligations and responsibilities of the Transferor, the Servicer and the Trustee
created hereby (other than the obligation of the Trustee to make payments to
Investor Certificateholders as hereinafter set forth) shall terminate, except
with respect to the duties described in Sections 8.04 and 12.02(b), upon the
earliest of (i) January 1, 2044 and (ii) the day following the payment date on
which the Aggregate Investor Amount and the Enhancement Investor Amount, if any,
for each Series is zero (provided that the Transferor has delivered a written
notice to the Trustee electing to terminate the Trust).
Section 12.02. Final Distribution.
(a) The Servicer shall give the Trustee at least 30 days' prior
notice of the payment date on which the Investor Certificateholders of any
Series or Class may surrender their Investor Certificates for payment of the
final distribution on and cancellation of such Investor Certificates (or, in the
event of a final distribution resulting from the application of Sections 2.06,
9.02 or 10.01, notice of such payment date promptly after the Servicer has
determined that a final distribution will occur, if such determination is made
less than 30 days prior to such payment date). Such notice shall be accompanied
by an Officer's Certificate setting forth the information specified in Section
3.05 covering the period during the then-current calendar year through the date
of such notice. Not later than the fifth day of the month in which the final
distribution in respect of such Series or Class is payable to Investor
Certificateholders, the Trustee shall provide notice to Investor
Certificateholders of such Series or Class specifying (i) the date upon which
final payment of such Series or Class will be made upon presentation and
surrender of Investor Certificates of such Series or Class at the office or
offices therein designated, (ii) the amount of any such final payment and (iii)
that the Record Date otherwise applicable to such payment date is not
applicable, payments being made only upon presentation and surrender of such
Investor Certificates at the office or offices therein specified (which, in the
case of Bearer Certificates, shall be outside the United States). The Trustee
shall give such notice to the Transfer Agent and Registrar and the Paying Agent
at the time such notice is given to Investor Certificateholders.
(b) Notwithstanding a final distribution to the Investor
Certificateholders of any Series or Class (or the termination of the Trust),
except as otherwise provided in this paragraph, all funds then on deposit in the
Collection Account and any Series Account allocated to such Investor
Certificateholders shall continue to be held in trust for the benefit of such
Investor Certificateholders and the Paying Agent or the Trustee shall pay such
funds to such Investor Certificateholders upon surrender of their Investor
Certificates (and any excess shall be paid in accordance with the terms of any
relevant Enhancement Agreement). In the event that all such Investor
Certificateholders shall not surrender their Investor Certificates for
cancellation within six months after the date specified in the notice from the
Trustee described in paragraph (a), the Trustee shall give a second notice to
the remaining such Investor Certificateholders to surrender their Investor
Certificates for cancellation and receive the final distribution with respect
thereto (which surrender and payment, in the case of Bearer Certificates, shall
be outside the United
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States). If within one year after the second notice all such Investor
Certificates shall not have been surrendered for cancellation, the Trustee may
take appropriate steps, or may appoint an agent to take appropriate steps, to
contact the remaining such Investor Certificateholders concerning surrender of
their Investor Certificates, and the cost thereof shall be paid out of the funds
in the Collection Account or any Series Account held for the benefit of such
Investor Certificateholders. The Trustee and the Paying Agent shall pay to the
Transferor any monies held by them for the payment of principal or interest that
remains unclaimed for two years. After payment to the Transferor, Investor
Certificateholders entitled to the money must look to the Transferor for payment
as general creditors unless an applicable abandoned property law designates
another Person.
(c) In the event that the Investor Amount with respect to any Series
is greater than zero on its Series Termination Date or such earlier date as is
specified in the related Supplement (after giving effect to deposits and
distributions otherwise to be made on such date), the Trustee will sell or cause
to be sold on such Series Termination Date, in accordance with the procedures
and subject to the conditions described in such Supplement, Principal
Receivables and the related Finance Charge Receivables (or interests therein) in
an amount equal to 100% of the Investor Amount and accrued and unpaid interest
thereon with respect to such Series on such date (after giving effect to such
deposits and distributions; provided, however, that in no event shall such
amount exceed such Series' Percentages of Receivables on such Series Termination
Date). The proceeds from any such sale shall be allocated and distributed in
accordance with the terms of the applicable Supplement.
Section 12.03. Transferor's Termination Rights. Upon the termination
of the Trust pursuant to Section 12.01 and the surrender of the Transferor
Certificates, the Trustee shall assign and convey to the Holders of the
Transferor Certificates or their designee, without recourse, representation or
warranty, all right, title and interest of the Trust in the Receivables, whether
then existing or thereafter created, all monies due or to become due and all
amounts received with respect thereto and all proceeds thereof, except for
amounts held by the Trustee pursuant to subsection 12.02(b). The Trustee shall
execute and deliver such instruments of transfer and assignment, in each case
without recourse, as shall be reasonably requested by the Transferor to vest in
the Holders of the Transferor Certificates or any of their designees all right,
title and interest which the Trust had in the Receivables and such other related
assets.
Section 12.04. Defeasance. Notwithstanding anything to the contrary
in this Agreement or any Supplement:
(a) The Transferor may at its option be discharged from its
obligations hereunder with respect to any Series or all outstanding Series (the
"Defeased Series") on the date the applicable conditions set forth in subsection
12.04(c) are satisfied (a "Defeasance"); provided, however, that the following
rights, obligations, powers, duties and immunities shall survive with respect to
the Defeased Series until otherwise terminated or discharged hereunder: (i) the
rights of the Holders of Investor Certificates of the Defeased Series to
receive, solely from the trust fund provided for in subsection 12.04(c),
payments in respect of principal of and interest on such Investor Certificates
when such payments are due; (ii) the Transferor's obligations with respect to
such Certificates under Sections 6.04 and 6.05; (iii) the rights, powers,
trusts, duties, and
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immunities of the Trustee, the Paying Agent and the Registrar hereunder; and
(iv) this Section 12.04.
(b) Subject to subsection 12.04(c), the Transferor at its option may
cause Collections allocated to the Defeased Series and available to purchase
additional Receivables to be applied to purchase Eligible Investments rather
than additional Receivables.
(c) The following shall be the conditions to Defeasance under
subsection 12.04(a):
(i) the Transferor irrevocably shall have deposited or
caused to be deposited with the Trustee (such deposit to be made
from other than the Transferor's or any Affiliate of the
Transferor's funds), under the terms of an irrevocable trust
agreement in form and substance satisfactory to the Trustee, as
trust funds in trust for making the payments described below, (A)
Dollars in an amount, or (B) Eligible Investments which through the
scheduled payment of principal and interest in respect thereof will
provide, not later than the due date of payment thereon, money in an
amount, or (C) a combination thereof, in each case sufficient to pay
and discharge (without relying on income or gain from reinvestment
of such amount), and which shall be applied by the Trustee to pay
and discharge, all remaining scheduled interest and principal
payments on all outstanding Investor Certificates of the Defeased
Series on the dates scheduled for such payments in this Agreement
and the applicable Supplements and all amounts owing to the Series
Enhancers with respect to the Defeased Series;
(ii) a statement from a firm of nationally recognized
independent public accountants (who may also render other services
to the Transferor) to the effect that such deposit is sufficient to
pay the amounts specified in clause (i) above;
(iii) prior to its first exercise of its right pursuant
to this Section 12.04 with respect to a Defeased Series to
substitute money or Eligible Investments for Receivables, if any
Series of Investor Certificates are outstanding that were
characterized as debt at the time of their issuance, the Transferor
shall have delivered to the Trustee an Opinion of Counsel to the
effect that such deposit and termination of obligations will not
cause the Trust to be an association or publicly traded partnership
taxable as a corporation, and (in any case) an Opinion of Counsel to
the effect that (A) such deposit and termination of obligations will
not result in the Trust being required to register as an "investment
company" within the meaning of the Investment Company Act and (B) if
the Transferor's short-term deposit or long-term unsecured debt
obligations are not rated at least P-3 or Baa3, respectively, by
Moody's, such deposit and termination of obligations would not be a
fraudulent conveyance (based in reliance on certain certificates to
the effect that the Receivables and termination of obligations
constitute fair value for consideration paid therefor and as to the
solvency of the Transferor);
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(iv) the Transferor shall have delivered to the Trustee
an Officer's Certificate of the Transferor stating the Transferor
reasonably believes that such deposit and termination of obligations
will not, based on the facts known to such officer at the time of
such certification, then cause a Pay Out Event or Reinvestment Event
with respect to any Series or any event that, with the giving of
notice or the lapse of time, would result in the occurrence of a Pay
Out Event with respect to any Series; and
(v) the Rating Agency Condition shall have been
satisfied and the Transferor shall have delivered copies of such
written notice to the Servicer and the Trustee.
Section 12.05. Optional Purchase.
(a) If so provided in any Supplement, the Transferor may, but shall
not be obligated to, cause a final distribution to be made in respect of the
related Series of Investor Certificates on a specified Distribution Date or when
the Investor Amount reaches a specified level or under any circumstances
specified in such Supplement by depositing into the Collection Account or the
applicable Series Account, not later than the Transfer Date preceding such
Distribution Date, for application in accordance with Section 12.02, the amount
specified in such Supplement; provided, however that if the short-term deposits
or long-term unsecured debt obligations of the Transferor are not rated at the
time of such purchase of Certificates at least P-3 or Baa3, respectively, by
Moody's, no such event shall occur unless the Transferor shall deliver an
Opinion of Counsel reasonably acceptable to the Trustee that such deposit into
the Collection Account or any Series Account as provided in the related
Supplement would not constitute a fraudulent conveyance of the Transferor (based
in reliance on certificates to the effect that the Receivables constitute fair
value for consideration paid therefor and as to the solvency of the Transferor).
(b) The amount deposited pursuant to subsection 12.05(a) shall be
paid to the Investor Certificateholders of the related Series pursuant to
Section 12.02 on the related Distribution Date following the date of such
deposit. All Certificates of a Series which are purchased by the Transferor
pursuant to subsection 12.05(a) shall be delivered by the Transferor upon such
purchase to, and be cancelled by, the Transfer Agent and Registrar and be
disposed of in a manner satisfactory to the Trustee and the Transferor. The
Investor Amount of each Series which is purchased by the Transferor pursuant to
subsection 12.05(a) shall, for the purposes of the definitions of "Series
Invested Amount" and "Transferor Amount," be deemed to be equal to zero on the
Distribution Date following the making of the deposit, and the Transferor Amount
shall thereupon be deemed to have been increased by the Series Invested Amount
of such Series.
[END OF ARTICLE XII]
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ARTICLE XIII
Miscellaneous Provisions
Section 13.01. Amendment; Waiver of Past Defaults.
(a) This Agreement or any Supplement may be amended from time to
time (including in connection with (x) the provision of additional Series
Enhancement for the benefit of the Certificateholders of any Series (or the
reduction of such Series Enhancement), (y) the addition of a Participation
Interest to the Trust or (z) the designation of an Additional Transferor) by the
Servicer, the Transferor (including, if applicable, any Additional Transferor
being designated) and the Trustee without the consent of any of the
Certificateholders, provided that (i) the Transferor shall have delivered to the
Trustee an Officer's Certificate to the effect that the Transferor reasonably
believes that such action will not have an Adverse Effect and (ii) the Rating
Agency Condition shall have been satisfied with respect to any such amendment.
In addition, this Agreement or any Supplement may be amended from time to time
under this subsection 13.01(a) by the parties hereto if the provisions set forth
in clause (i) of the preceding sentence are satisfied, but without notice to or
the consent of the Certificateholders and without satisfaction of the Rating
Agency Condition, for any one or more of the following purposes: (A) to enable
all or a portion of the Trust 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" under the Code (and, in connection with any such election, to
modify or eliminate existing provisions relating to the intended federal income
tax treatment of the Certificates and the Trust), (B) to enable the Trust to
qualify as a partnership for purposes of any state tax laws (including any
amendment to Section 9.02 to read in its entirety substantially as set forth in
Exhibit H hereto).
(b) This Agreement or any Supplement may also be amended from time
to time by the Servicer, the Transferor and the Trustee, with the consent of the
Holders of Investor Certificates evidencing not less than 66-2/3% of the
aggregate Investor Amount of the Investor Certificates of all adversely affected
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 Certificateholders; provided, however,
that no such amendment shall (i) reduce in any manner the amount of or delay the
timing of any distributions to be made to Investor Certificateholders or
deposits of amounts to be so distributed or the amount available under any
Series Enhancement without the consent of each affected Certificateholder, (ii)
change the definition of or the manner of calculating the interest of any
Investor Certificateholder without the consent of each affected Investor
Certificateholder, (iii) reduce the aforesaid percentage required to consent to
any such amendment without the consent of each Investor Certificateholder or
(iv) adversely affect the rating of any Series or Class by each Rating Agency
without the consent of the Holders of Investor Certificates of such Series or
Class evidencing not less than 66-2/3% of the aggregate Investor Amount of the
Investor Certificates of such Series or Class. Any amendment to be effected
pursuant to this paragraph shall be deemed not to adversely affect any
outstanding Series with respect to which the Transferor shall deliver an Opinion
of Counsel, addressed and delivered to the Trustee, that such action will not,
in such counsel's reasonable opinion, have an Adverse Effect with respect to
such Series. The Trustee may, but shall not be obligated to,
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enter into any such amendment which affects the 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)), the Trustee shall furnish
notification of the substance of such amendment to each Investor
Certificateholder, and the Servicer shall furnish notification of the substance
of such amendment to each Rating Agency.
(d) It shall not be necessary for the consent of Investor
Certificateholders under this Section to approve the particular form of any
proposed amendment, but it shall be sufficient if such consent shall approve the
substance thereof. The manner of obtaining such consents and of evidencing the
authorization of the execution thereof by Investor Certificateholders shall be
subject to such reasonable requirements as the Trustee may prescribe.
(e) Any Supplement executed in accordance with the provisions of
subsection 6.03(b) 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 Investor 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 Investor Amount of the Investor Certificates of each Series to
which such default relates or, with respect to any such Series with two or more
Classes, of each Class) may, on behalf of all Certificateholders, waive any
default by the Transferor or the Servicer in the performance of their
obligations hereunder and its consequences, except the failure to make any
distributions required to be made to Investor Certificateholders or to make any
required deposits of any amounts to be so distributed. Upon any such waiver of a
past default, such default shall cease to exist, and any default arising
therefrom shall be deemed to have been remedied for every purpose of this
Agreement. No such waiver shall extend to any subsequent or other default or
impair any right consequent thereto except to the extent expressly so waived.
Section 13.02. Protection of Right, Title and Interest to Trust.
(a) The Servicer shall cause this Agreement, all amendments and
supplements hereto and all financing statements and continuation statements and
any other necessary documents covering the Certificateholders' and the Trustee's
right, title and interest to the Trust to be promptly recorded, registered and
filed, and at all times to be kept recorded, registered and filed, all in such
manner and in such places as may be required by law fully to preserve and
protect the right, title and interest of the Certificateholders and the Trustee
hereunder to all property comprising the Trust. The Servicer shall deliver to
the Trustee file-stamped copies of, or filing receipts for, any document
recorded, registered or filed as provided above, as soon as available following
such recording, registration or filing. The Transferor shall cooperate fully
with the Servicer in connection with the obligations set forth above and will
execute any and all documents reasonably required to fulfill the intent of this
paragraph.
(b) Within 30 days after any Transferor makes any change in its
name, identity or corporate structure which would make any financing statement
or continuation statement filed
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in accordance with paragraph (a) seriously misleading within the meaning of
Section 9-402(7) (or any comparable provision) of the UCC, such Transferor shall
give the Trustee notice of any such change and shall file such financing
statements or amendments as may be necessary to continue the perfection of the
Trust's security interest in the Receivables and the proceeds thereof.
(c) Each Transferor and the Servicer will give the Trustee prompt
notice of any relocation of any office from which it services Receivables or
keeps records concerning the Receivables or of its principal executive office
and whether, as a result of such relocation, the applicable provisions of the
UCC would require the filing of any amendment of any previously filed financing
or continuation statement or of any new financing statement and shall file such
financing statements or amendments as may be necessary to perfect or to continue
the perfection of the Trust's security interest in the Receivables and the
proceeds thereof. Each Transferor and the Servicer will at all times maintain
each office from which it services Receivables and its principal executive
offices within the United States.
(d) The Servicer will deliver to the Trustee: (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 G-1; (ii) on each Addition Date on
which any Additional Accounts (other than Automatic Additional Accounts) are to
be designated as Accounts pursuant to subsections 2.09(a) or (b) and on each
date specified in subsection 2.09(d)(iii) with respect to the designation of
Automatic Additional Accounts as Accounts, an Opinion of Counsel substantially
in the form of Exhibit G-2, and on each Addition Date on which any Participation
Interests are to be included in the Trust pursuant to subsections 2.09(a) or
(b), an Opinion of Counsel covering the same substantive legal issues addressed
by Exhibit G-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, 1999, an Opinion of Counsel substantially in the form
of Exhibit G-3.
Section 13.03. Limitation on Rights of Certificateholders.
(a) The death or incapacity of any Certificateholder shall not
operate to terminate this Agreement or the Trust, nor shall such death or
incapacity entitle such Certificateholders' legal representatives or heirs to
claim an accounting or to take any action or commence any proceeding in any
court for a partition or winding up of the Trust, nor otherwise affect the
rights, obligations and liabilities of the parties hereto or any of them.
(b) No Investor Certificateholder shall have any right to vote
(except as expressly provided in this Agreement) or in any manner otherwise
control the operation and management of the Trust, or the obligations of the
parties hereto, nor shall anything herein set forth, or contained in the terms
of the Certificates, be construed so as to constitute the Investor
Certificateholders from time to time as partners or members of an association,
nor shall any Investor Certificateholder be under any liability to any third
person by reason of any action taken by the parties to this Agreement pursuant
to any provision hereof.
(c) No Investor Certificateholder shall have any right by virtue of
any provisions of this Agreement to institute any suit, action or proceeding in
equity or at law upon or under or with respect to this Agreement, unless such
Investor Certificateholder previously shall have
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made, and unless the Holders of Investor Certificates evidencing more than 50%
of the aggregate unpaid principal amount of all Investor Certificates (or, with
respect to any such action, suit or proceeding that does not relate to all
Series, 50% of the aggregate unpaid principal amount of the Investor
Certificates of all Series to which such action, suit or proceeding relates)
shall have made, a request to the Trustee to institute such action, suit or
proceeding in its own name as Trustee hereunder and shall have offered to the
Trustee such reasonable indemnity as it may require against the costs, expenses
and liabilities to be incurred therein or thereby, and the Trustee, for 60 days
after such request and offer of indemnity, shall have neglected or refused to
institute any such action, suit or proceeding; it being understood and intended,
and being expressly covenanted by each Investor Certificateholder with every
other Investor Certificateholder and the Trustee, that no one or more Investor
Certificateholders shall have any right in any manner whatever by virtue or by
availing itself or themselves of any provisions of this Agreement to affect,
disturb or prejudice the rights of the Holders of any other of the Investor
Certificates, or to obtain or seek to obtain priority over or preference to any
other such Investor Certificateholder, or to enforce any right under this
Agreement, except in the manner herein provided and for the equal, ratable and
common benefit of all Investor Certificateholders except as otherwise expressly
provided in this Agreement. For the protection and enforcement of the provisions
of this Section, each and every Investor Certificateholder and the Trustee shall
be entitled to such relief as can be given either at law or in equity.
Section 13.04. GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF 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; PROVIDED,
HOWEVER, THAT THE IMMUNITIES AND STANDARD OF CARE OF THE TRUSTEE IN THE
ADMINISTRATION OF THE TRUST HEREUNDER SHALL BE GOVERNED BY THE LAWS OF THE STATE
OF NEW YORK.
Section 13.05. Notices; Payments.
(a) All demands, notices, instructions, directions and
communications (collectively, "Notices") under this Agreement shall be in
writing and shall be deemed to have been duly given if personally delivered at,
mailed by registered mail, return receipt requested, or sent by facsimile
transmission (i) in the case of the Transferor, to CC Credit Card Corporation,
100 Commerce Drive, Suite 300B, Newark, Delaware 19713 (telephone no.
302-451-6456), (ii) in the case of the Servicer, to Travelers Bank & Trust, fsb,
100 Commerce Drive, Newark, Delaware 19713 (telephone no. 302-454-5500), (iii)
in the case of the Trustee, to The Bank of New York, 101 Barclay Street, 21
West, New York, New York 10286, Attention: Corporate Trust Department --
Trustee, (iv) in the case of Moody's, to 99 Church Street, New York, New York
10007, Attn: ABS Monitoring Department, 4th Floor (facsimile no. 212-553-4600),
(v) in the case of Standard & Poor's, to 26 Broadway, New York, New York 10004,
Attn: Asset Backed Group, 15th Floor (facsimile no. 212-412-0323), (vi) in the
case of the Paying Agent or the Transfer Agent and Registrar, to The Bank of New
York, 101 Barclay Street, 21 West, New York, New York 10286, Attention:
Corporate Trust Department and (vii) to any other Person as specified in any
Supplement; or, as to each party, at such other
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address or facsimile number as shall be designated by such party in a written
notice to each other party.
(b) Any Notice required or permitted to be given to a Holder of
Registered Certificates shall be given by first-class mail, postage prepaid, at
the address of such Holder as shown in the Certificate Register. No Notice shall
be required to be mailed to a Holder of Bearer Certificates or Coupons but shall
be given as provided below. Any Notice so mailed within the time prescribed in
this Agreement shall be conclusively presumed to have been duly given, whether
or not the Investor Certificateholder receives such Notice. In addition, (a) if
and so long as any Series or Class is listed on the Luxembourg Stock Exchange
and such Exchange shall so require, any Notice to Investor Certificateholders
shall be published in an Authorized Newspaper of general circulation in
Luxembourg within the time period prescribed in this Agreement and (b) in the
case of any Series or Class with respect to which any Bearer Certificates are
outstanding, any Notice required or permitted to be given to Investor
Certificateholders of such Series or Class shall be published in an Authorized
Newspaper within the time period prescribed in this Agreement.
Section 13.06. Rule 144A Information. For so long as any of the
Investor Certificates of any Series or Class are "restricted securities" within
the meaning of Rule 144(a)(3) under the Act, each of the Transferor, the
Trustee, the Servicer and any Series Enhancer agree to cooperate with each other
to provide to any Investor Certificateholders of such Series or Class and to any
prospective purchaser of Certificates designated by such an Investor
Certificateholder, upon the request of such Investor Certificateholder or
prospective purchaser, any information required to be provided to such holder or
prospective purchaser to satisfy the condition set forth in Rule 144A(d)(4)
under the Act.
Section 13.07. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement shall for any
reason whatsoever be held invalid, then such provisions shall be deemed
severable from the remaining provisions of this Agreement and shall in no way
affect the validity or enforceability of the remaining provisions or of the
Certificates or the rights of the Certificateholders.
Section 13.08. Assignment. Notwithstanding anything to the contrary
contained herein, except as provided in Section 8.02, this Agreement may not be
assigned by the Servicer without the prior consent of Holders of Investor
Certificates evidencing not less than 66-2/3% of the Aggregate Investor Amount.
The Servicer shall give the Rating Agencies prior written notice of any such
assignment.
Section 13.09. Certificates Nonassessable and Fully Paid. It is the
intention of the parties to this Agreement that the Certificateholders shall not
be personally liable for obligations of the Trust, that the interests in the
Trust represented by the Certificates shall be nonassessable for any losses or
expenses of the Trust or for any reason whatsoever and that Certificates upon
authentication thereof by the Trustee pursuant to Section 6.02 are and shall be
deemed fully paid.
Section 13.10. Further Assurances. The Transferor and the Servicer
agree to do and perform, from time to time, any and all acts and to execute any
and all further instru-
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ments required or reasonably requested by the Trustee more fully to effect the
purposes of this Agreement, including the execution of any financing statements
or continuation statements relating to the Receivables for filing under the
provisions of the UCC of any applicable jurisdiction.
Section 13.11. Nonpetition Covenant. Notwithstanding any prior
termination of this Agreement, the Servicer, the Trustee, each Transferor, each
Series Enhancer and each Holder of a Transferor Certificate shall not, prior to
the date which is one year and one day after the termination of this Agreement
with respect to the Trust, acquiesce, petition or otherwise invoke or cause the
Trust to invoke the process of any Governmental Authority for the purpose of
commencing or sustaining a case against the Trust under any Federal or state
bankruptcy, insolvency or similar law or appointing a receiver, liquidator,
assignee, trustee, custodian, sequestrator or other similar official of the
Trust or any substantial part of its property or ordering the winding-up or
liquidation of the affairs of the Trust.
Section 13.12. No Waiver; Cumulative Remedies. No failure to
exercise and no delay in exercising, on the part of the Trustee or the
Certificateholders, any right, remedy, power or privilege under this Agreement
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right, remedy, power or privilege under this Agreement preclude any other or
further exercise thereof or the exercise of any other right, remedy, power or
privilege. The rights, remedies, powers and privileges provided under this
Agreement are cumulative and not exhaustive of any rights, remedies, powers and
privileges provided by law.
Section 13.13. 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 13.14. Third-Party Beneficiaries. This Agreement will inure
to the benefit of and be binding upon the parties hereto, the
Certificateholders, any Series Enhancer (to the extent provided in this
Agreement and the related Supplement) and their respective successors and
permitted assigns. Except as otherwise expressly provided in this Agreement, no
other Person will have any right or obligation hereunder.
Section 13.15. Actions by Certificateholders. (a) Wherever in this
Agreement a provision is made that an action may be taken or a Notice given by
Certificateholders, such action or Notice may be taken or given by any
Certificateholder, unless such provision requires a specific percentage of
Certificateholders.
(b) Any Notice, request, authorization, direction, consent, waiver
or other act by the Holder of a Certificate shall bind such Holder and every
subsequent Holder of such Certificate and of any Certificate issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done or omitted to be done by the Trustee or the Servicer in
reliance thereon, whether or not notation of such action is made upon such
Certificate.
Section 13.16. Merger and Integration. Except as specifically stated
otherwise herein, this Agreement sets forth the entire understanding of the
parties relating to the subject
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matter hereof, and all prior understandings, written or oral, are superseded by
this Agreement. This Agreement may not be modified, amended, waived or
supplemented except as provided herein.
Section 13.17. Headings. The headings herein are for purposes of
reference only and shall not otherwise affect the meaning or interpretation of
any provision hereof.
Section 13.18. Construction of Agreement. The Transferor hereby
grants a first priority perfected security interest to (i) the Trustee on behalf
of the Trust, for the benefit of the Certificateholders in all of the
Transferor's right, title and interest in, to and under the Receivables existing
at the close of business on the Initial Cut-Off Date, in the case of Receivables
arising in the Initial Accounts, and on each Addition Cut-Off Date, in the case
of Receivables arising in the Additional Accounts, and in each case thereafter
created from time to time until the termination of the Trust, all monies due or
to become due and all amounts received with respect thereto (excluding, however,
any and all Recoveries) and all proceeds (including "proceeds" as defined in the
UCC) thereof and any other Trust Assets. This Agreement shall constitute a
security agreement under applicable law.
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IN WITNESS WHEREOF, the Transferor, the Servicer and the Trustee
have caused this Agreement to be duly executed by their respective officers as
of the day and year first above written.
CC CREDIT CARD CORPORATION,
Transferor,
By /s/ Barbara Yastine
-------------------------------------
Name: Barbara Yastine
Title: President
TRAVELERS BANK & TRUST, fsb,
Servicer,
By /s/ Charles Haug
-------------------------------------
Name: Charles Haug
Title: SVP & CFO
THE BANK OF NEW YORK,
as Trustee and as Securities Intermediary under
Section 4.02 of this Agreement
By /s/ Wuhan Dansby
-------------------------------------
Name: Wuhan Dansby
Title: Assistant Vice President
IN WITNESS WHEREOF, the TRAVELERS BANK & TRUST, fsb, hereby executes
this Agreement in its individual capacity for the limited purpose of accepting
the terms and agreeing to the provisions of Section 2.13 hereof. Travelers Bank
& Trust, fsb, hereby accepts and agrees to the terms of Section 2.13 hereof and
grants to the Trustee the security interest set forth therein.
TRAVELERS BANK & TRUST, fsb,
By /s/ Charles Haug
-------------------------------------
Name: Charles Haug
Title: SVP & CFO
[Signature page to the Pooling and Servicing Agreement]
Exhibit 4.2
EXECUTION COPY
- --------------------------------------------------------------------------------
CC CREDIT CARD CORPORATION
Transferor
TRAVELERS BANK & TRUST, fsb
Servicer
and
THE BANK OF NEW YORK
Trustee and Securities Intermediary
on behalf of the Series 1998-1 Holders
SERIES 1998-1 SUPPLEMENT
Dated as of March 1, 1998
to
POOLING AND SERVICING AGREEMENT
Dated as of March 1, 1998
TRAVELERS BANK CREDIT CARD MASTER TRUST I
SERIES 1998-1
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
Creation of the Series 1998-1 Certificates
Section 1.1. Designation .................................................. 2
ARTICLE II
Definitions
Section 2.1. Definitions .................................................. 3
ARTICLE III
Servicer and Trustee
Section 3.1. Servicing Compensation ...................................... 17
ARTICLE IV
Holder and Allocation and Application of Collections
Section 4.1. Collections and Allocations ................................. 18
Section 4.2. Determination of Monthly Interest............................ 21
Section 4.3. Determination of Monthly Principal .......................... 21
Section 4.4. Required Amount ............................................. 22
Section 4.5. Application of Class A Available Funds, Class B Available
Funds, Class C Available Funds and Available Investor
Principal Collections ....................................... 23
Section 4.6. Default Amounts; Investor Charge-Offs ....................... 25
Section 4.7. Excess Spread; Excess Finance Charge Collections; Excess
Transferor Finance Charge Collections ....................... 27
Section 4.8. Reallocated Principal Collections ........................... 28
Section 4.9. Excess Finance Charge Collections and Excess Transferor
Finance Charge Collections .................................. 29
Section 4.10. Shared Principal Collections and Shared Transferor Principal
Collections ................................................. 29
Section 4.11. Principal Funding Account ................................... 30
Section 4.12. Class A Accumulation Period ................................. 32
Section 4.13. Reserve Account ............................................. 33
Section 4.14. Designation of Class B Certificates Terms; Sale of Class B
Certificates ................................................ 35
Section 4.15. Designation of Class C Interests Terms; Sale of Class C
Interests ................................................... 35
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TABLE OF CONTENTS
(continued)
Page
ARTICLE V
Distributions and Reports to Series 1998-1 Certificateholders
Section 5.1. Distributions ............................................... 36
Section 5.2. Certificates and Statements ................................. 37
ARTICLE VI
Additional Pay Out Events
Section 6.1. Additional Pay Out Events ................................... 38
ARTICLE VII
Optional Repurchase; Series Termination
Section 7.1. Optional Repurchase ......................................... 39
Section 7.2. Series Termination .......................................... 40
ARTICLE VIII
Final Distributions
Section 8.1. Sale of Receivables or Certificateholders' Interest Pursuant
to Section 2.06 or 10.01 of the Agreement ................... 40
ARTICLE IX
Certificates
Section 9.1. Book-Entry Certificates ..................................... 41
Section 9.2. Uncertificated Securities ................................... 42
ARTICLE X
Miscellaneous Provisions
Section 10.1. Ratification of Agreement ................................... 42
Section 10.2. Counterparts ................................................ 42
Section 10.3. Governing Law ............................................... 42
Section 10.4. Notices ..................................................... 42
Section 10.5. Amendments .................................................. 42
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SERIES 1998-1 SUPPLEMENT, dated as of March 1, 1998 (the
"Supplement"), among CC CREDIT CARD CORPORATION, a Delaware corporation, as
Transferor (the "Transferor"), TRAVELERS BANK & TRUST, fsb, a federally
chartered savings bank, as Servicer (the "Servicer"), and The Bank of New York,
a New York banking corporation, as Trustee (together with its successors in
trust thereunder as provided in the Pooling and Servicing Agreement referred to
below, the "Trustee") under the Pooling and Servicing Agreement dated as of
March 1, 1998 (the "Agreement") among the Transferor, the Servicer and the
Trustee.
PRELIMINARY STATEMENT
Pursuant to the Agreement, the Transferor has created the Travelers
Bank Master Credit Card Trust I (the "Trust"). Section 6.03 of the Agreement
provides that the Transferor may from time to time direct the Trustee to
authenticate one or more new Series of Investor Certificates representing
fractional undivided interests in the Trust. The Principal Terms of any new
Series are due to be set forth in a Supplement to the Agreement.
Pursuant to this Supplement, the Transferor and the Trustee shall
create a new Series of Investor Certificates and specify the Principal Terms
thereof.
ARTICLE I
Creation of the Series 1998-1 Certificates
Section 1.1. Designation.
(a) There is hereby created a Series of Investor Certificates to be
issued pursuant to the Agreement and this Supplement to be known as "Travelers
Bank Credit Card Master Trust I, Series 1998-1." The Series of Investor
Certificates created hereby shall be issued in three Classes. The first Class
shall be known as the "Class A 6.00% Asset Backed Certificates, Series 1998-1,"
the second Class shall be known as the "Class B Asset Backed Certificates,
Series 1998-1" and the third Class shall be known as the "Class C Asset Backed
Interests, Series 1998-1." Except as expressly provided herein, the Class B
Certificates and the Class C Interests shall be deemed to be "Investor
Certificates" for all purposes under the Agreement and this Supplement and shall
be in uncertificated form. Notwithstanding anything to the contrary in the
Agreement, (i) none of the Class B Certificateholders or the Class C Interest
Holders shall be considered a Series Enhancer for Series 1998-1.
(b) Series 1998-1 shall be included in Group One. Series 1998-1
shall be a Principal Sharing Series with respect to Group One only. Series
1998-1 shall be an Excess Allocation Series with respect to Group One only.
Series 1998-1 shall be entitled to share Excess Transferor Finance Charge
Collections and Shared Transferor Principal Collections. Series 1998-1 shall not
be subordinated to any other Series. Notwithstanding any provision in the
Agreement or in this Supplement to the contrary, the first Distribution Date
with respect to Series 1998-1 shall be the April 15, 1998 Distribution Date, and
references herein to the Monthly
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Period relating to the April 15, 1998 Distribution Date shall mean the period
from the Closing Date through March 31, 1998.
(c) In the event that any term or provision contained herein shall
conflict with or be inconsistent with any term or provision contained in the
Agreement, the terms and provisions of this Supplement shall govern.
(d) The Class B Certificateholders and the Class C Interest Holders,
as holders of an "Investor Certificate" under the Agreement, shall be entitled
to the benefits of the Agreement and this Supplement. Notwithstanding the
foregoing, except as expressly provided herein, the provisions of Article VI and
Article XII of the Agreement relating to the registration, authentication,
delivery, presentation, cancellation and surrender of Registered Certificates
and clauses (a) and (c) of the definition of "Tax Opinion" in Section 1.01 of
the Agreement shall not be applicable to the Class B Certificates or the Class C
Interests.
ARTICLE II
Definitions
Section 2.1. Definitions.
(a) Whenever used in this 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.
"Additional Interest" shall mean, at any time of determination, the
Class A Additional Interest and the Class B Additional Interest, if any.
"Available Investor Principal Collections" shall mean, with respect
to any Monthly Period, an amount equal to the sum of (a) (i) an amount equal to
the Principal Allocation Percentage of all Collections of Principal Receivables
received during such Monthly Period, minus (ii) the amount of Reallocated
Principal Collections with respect to such Monthly Period which pursuant to
Section 4.8 are required to fund any deficiency in the amount to be distributed
pursuant to subsections 4.5(a)(i), (ii) and (iii) or subsections 4.5(b)(i) and
(ii) and subsection 4.7(d) for the related Distribution Date, plus (b) any
Shared Principal Collections with respect to other Principal Sharing Series in
Group One (including any amounts on deposit in the Excess Funding Account that
are allocated to Series 1998-1 pursuant to the Agreement for application as
Shared Principal Collections) and any Shared Transferor Principal Collections
that are allocated to Series 1998-1 in accordance with Section 4.04 of the
Agreement and subsection 4.10(a) hereof, plus (c) any other amounts which
pursuant to subsection 4.5(a)(iii) (including any amounts allocated with respect
thereto pursuant to subsection 4.7(a)) and subsections 4.7(b), (d), (e), (h) and
(i) hereof are to be treated as Available Investor Principal Collections with
respect to the related Distribution Date or subsections 4.5(b)(i) and (ii) and
subsection 4.7(d).
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"Average Principal Balance" shall mean, for any Monthly Period in
which an Addition Date or Removal Date occurs, the weighted average of (A) the
sum of (i) the product of (x) the aggregate amount of Principal Receivables in
the Trust and (y) one minus the Discount Percentage and (ii) the principal
amount on deposit in the Excess Funding Account at the end of the day on the
last day of the prior Monthly Period and (B) the sum of (i) the product of (x)
the aggregate amount of Principal Receivables in the Trust and (y) one minus the
Discount Percentage and (ii) the principal amount on deposit in the Excess
Funding Account at the end of the day on the related Addition Date or Removal
Date, weighted, respectively, by a fraction, the numerator of which is the
number of days from and including the first day of such Monthly Period, to but
excluding the related Addition Date or Removal Date, and the denominator of
which is the number of days in such Monthly Period, and by a fraction, the
numerator of which is the number of days from and including the related Addition
Date or Removal Date to and including the last day of such Monthly Period, and
the denominator of which is the number of days in such Monthly Period.
"Base Rate" shall mean, with respect to any Monthly Period, the
annualized percentage equivalent of a fraction, the numerator of which is equal
to the sum of the Class A Monthly Interest, the Class B Monthly Interest, if
any, the Class C Monthly Interest, if any, and the Monthly Servicing Fee, each
for the related Distribution Date and the denominator of which is the Investor
Amount as of the last day of the preceding Monthly Period.
"Book-Entry Register" shall mean the register maintained by the
Trustee providing for the registration of the Class B Certificates and the Class
C Interests and transfers thereof.
"Class A Accumulation Period" shall mean, unless a Pay Out Event
with respect to Series 1998-1 shall have occurred prior thereto, the period
commencing on the Controlled Accumulation Date or such later date as is
determined in accordance with Section 4.12 and ending on the first to occur of
(a) the commencement of the Rapid Amortization Period, (b) the payment in full
to the Class A Certificateholders of the Class A Investor Amount or (c) the
Series Termination Date.
"Class A Accumulation Period Length" shall have the meaning
specified in Section 4.12.
"Class A Additional Interest" shall have the meaning specified in
Section 4.2.
"Class A Available Funds" shall mean, with respect to any Monthly
Period, an amount equal to the sum of (a) the Class A Floating Percentage of the
Collections of Finance Charge Receivables allocated to Series 1998-1 (including
any amounts that are to be treated as Collections of Finance Charge Receivables
in accordance with the Agreement), (b) the amount of Principal Funding
Investment Proceeds, if any, with respect to such Distribution Date, and (c) the
amount of funds, if any, to be withdrawn from the Reserve Account which,
pursuant to Section 4.13 are required to be included in Class A Available Funds
with respect to such Distribution Date.
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"Class A Certificate Rate" shall mean, 6.00% of per annum.
"Class A Certificateholder" shall mean the Person in whose name a
Class A Certificate is registered in the Certificate Register.
"Class A Certificates" shall mean any one of the Certificates
executed by the Transferor and authenticated by or on behalf of the Trustee,
substantially in the form of Exhibit A.
"Class A Expected Final Distribution Date" shall mean the February
2003 Distribution Date.
"Class A Floating Percentage" shall mean, with respect to any
Monthly Period, the percentage equivalent (which percentage shall never exceed
100%) of a fraction, the numerator of which is equal to the Class A Invested
Amount as of the close of business on the last day of the preceding Monthly
Period and the denominator of which is equal to the Invested Amount as of the
close of business on the last day of the preceding Monthly Period; provided,
however, that with respect to the first Monthly Period, the Class A Floating
Percentage shall mean the percentage equivalent of a fraction, the numerator of
which is the Class A Initial Invested Amount and the denominator of which is the
Initial Invested Amount.
"Class A Initial Invested Amount" shall mean $227,500,000.
"Class A Initial Investor Amount" shall mean the aggregate initial
principal balance of the Class A Certificates, which is $227,500,000.
"Class A Interest Shortfall" shall have the meaning specified in
Section 4.2.
"Class A Invested Amount" shall mean, on any date of determination,
an amount equal to (a) the Class A Initial Invested Amount minus (b) the
aggregate amount of principal payments made to the Class A Certificateholders on
or prior to such date, minus (c) the excess, if any, of the aggregate amount of
Class A Investor Charge-Offs for all prior Distribution Dates over the aggregate
amount of Class A Investor Charge-Offs reimbursed pursuant to subsection 4.6(a)
prior to such date minus (d) the Principal Funding Account Balance.
"Class A Investor Amount" shall mean, on any date of determination,
an amount equal to the sum of (a) the Class A Invested Amount and (b) the
Principal Funding Account Balance.
"Class A Investor Charge-Off" shall have the meaning specified in
subsection 4.6(a).
"Class A Investor Default Amount" shall mean, with respect to each
Distribution Date, an amount equal to the product of (i) the Investor Default
Amount for the related Monthly Period and (ii) the Class A Floating Percentage
for such Monthly Period.
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"Class A Monthly Interest" shall have the meaning specified in
Section 4.2.
"Class A Monthly Principal" shall have the meaning specified in
subsection 4.3(a).
"Class A Penalty Rate" shall mean the sum of the Class A Certificate
Rate and 2.0% per annum.
"Class A Principal Percentage" shall mean, with respect to any
Monthly Period (i) during the Revolving Period, the percentage equivalent (which
percentage shall never exceed 100%) of a fraction, the numerator of which is the
Class A Invested Amount as of the last day of the immediately preceding Monthly
Period and the denominator of which is the Invested Amount as of such day and
(ii) during the Controlled Accumulation Period or the Rapid Amortization Period,
the percentage equivalent (which percentage shall never exceed 100%) of a
fraction, the numerator of which is the Class A Invested Amount as of the last
day of the Revolving Period, and the denominator of which is the Invested Amount
as of such last day; provided, however, that with respect to the first Monthly
Period, the Class A Principal Percentage shall mean the percentage equivalent of
a fraction, the numerator of which is the Class A Initial Invested Amount and
the denominator of which is the Initial Invested Amount.
"Class A Required Amount" shall have the meaning specified in
subsection 4.4(a).
"Class A Servicing Fee" shall have the meaning specified in Section
3.1.
"Class B Accumulation Period" shall mean, unless a Pay Out Event
with respect to Series 1998-1 shall have occurred prior thereto, the period
commencing on the first day of the Monthly Period immediately preceding the
Class B Principal Commencement Date and ending on the first to occur thereafter
of (a) the commencement of the Rapid Amortization Period, (b) the payment in
full to the Class B Certificateholders of the Class B Invested Amount or (c) the
Series Termination Date.
"Class B Additional Interest" shall initially mean $0, and if the
Class B Certificates are transferred as provided in Section 4.14, Class B
Additional Interest shall thereafter mean additional interest, if any,
distributable in respect of the Class B Certificates as such additional
interest, if any, may be calculated in a supplemental agreement entered into in
accordance with Section 4.14.
"Class B Available Funds" shall mean, with respect to any Monthly
Period, an amount equal to the Class B Floating Percentage of the Collections of
Finance Charge Receivables allocated to Series 1998-1 (including any amounts
that are to be treated as Collections of Finance Charge Receivables in
accordance with the Agreement).
"Class B Certificate Rate" shall mean, with respect to each Interest
Period, a per annum rate equal to 0%; provided, however, that such interest rate
may be increased pursuant to the terms of a supplemental agreement entered into
in accordance with Section 4.14.
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"Class B Certificateholder" shall mean the Person in whose name a
Class B Certificate is registered in the Book-Entry Register, which shall
initially be the Transferor.
"Class B Certificates" shall mean an uncertificated fractional
undivided interest in the Trust that shall consist of the right to receive, to
the extent necessary to make the required payments to the Class B
Certificateholders under this Supplement, the portion of Collections allocable
thereto under the Agreement and this Supplement, and funds on deposit in the
Collection Account allocable thereto pursuant to the Agreement and this
Supplement.
"Class B Expected Final Distribution Date" shall mean the March 2003
Distribution Date.
"Class B Floating Percentage" shall mean, with respect to any
Monthly Period, the percentage equivalent (which percentage shall never exceed
100%) of a fraction, the numerator of which is equal to the Class B Invested
Amount as of the close of business on the last day of the preceding Monthly
Period and the denominator of which is equal to the Invested Amount as of the
close of business on the last day of the preceding Monthly Period; provided,
however, that with respect to the first Monthly Period, the Class B Floating
Percentage shall mean the percentage equivalent of a fraction, the numerator of
which is the Class B Initial Invested Amount and the denominator of which is the
Initial Invested Amount.
"Class B Initial Invested Amount" shall mean $12,500,000.
"Class B Invested Amount" shall mean, on any date of determination,
an amount equal to (a) the Class B Initial Invested Amount, minus (b) the
aggregate amount of principal payments made to the Class B Certificateholders on
or prior to such date minus (c) the excess, if any, of the aggregate amount of
Class B Investor Charge-Offs for all prior Distribution Dates over the aggregate
amount of any reimbursement of Class B Investor Charge-Offs pursuant to
subsection 4.6(b) for all Distribution Dates preceding such date, minus (d) the
aggregate amount of Reallocated Principal Collections allocated on all prior
Distribution Dates pursuant to subsection 4.8(a) (excluding any Reallocated
Principal Collections that have resulted in a reduction in the Class C Invested
Amount pursuant to subsection 4.6(c)), minus (e) an amount equal to the amount
by which the Class B Invested Amount has been reduced on all prior Distribution
Dates pursuant to subsection 4.6(a) and plus (f) the amount of Excess Spread,
Excess Finance Charge Collections and Excess Transferor Finance Charge
Collections allocated to Series 1998-1 on all prior Distribution Dates pursuant
to subsection 4.7(e) for the purpose of reimbursing amounts deducted pursuant to
the foregoing clauses (c), (d) and (e); provided, however, that the Class B
Invested Amount shall not be reduced below zero.
"Class B Investor Charge-Off" shall have the meaning specified in
subsection 4.6(b).
"Class B Investor Default Amount" shall mean, with respect to each
Distribution Date, an amount equal to the product of (i) the Investor Default
Amount for the related Monthly Period and (ii) the Class B Floating Percentage
for such Monthly Period.
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"Class B Monthly Interest" shall initially mean $0, and if the Class
B Certificates are transferred as provided in Section 4.14, Class B Monthly
Interest shall thereafter mean the interest, if any, distributable in respect of
the Class B Certificates as such interest may be calculated in a supplemental
agreement entered into in accordance with Section 4.14.
"Class B Monthly Principal" shall have the meaning specified in
subsection 4.3(b).
"Class B Principal Commencement Date" shall mean the Distribution
Date on which the Class A Investor Amount is paid in full; provided, that if the
Class A Investor Amount is paid in full on the Class A Expected Final
Distribution Date and the Rapid Amortization Period has not commenced, the Class
B Principal Commencement Date shall mean the Class B Expected Final Distribution
Date.
"Class B Principal Percentage" shall mean, with respect to any
Monthly Period (i) during the Revolving Period, the percentage equivalent (which
percentage shall never exceed 100%) of a fraction, the numerator of which is the
Class B Invested Amount as of the last day of the immediately preceding Monthly
Period and the denominator of which is the Invested Amount as of such day and
(ii) during the Controlled Accumulation Period or the Rapid Amortization Period,
the percentage equivalent (which percentage shall never exceed 100%) of a
fraction, the numerator of which is the Class B Invested Amount as of the last
day of the Revolving Period, and the denominator of which is the Invested Amount
as of such last day; provided, however, that with respect to the first Monthly
Period, the Class B Principal Percentage shall mean the percentage equivalent of
a fraction, the numerator of which is the Class B Initial Invested Amount and
the denominator of which is the Initial Invested Amount.
"Class B Required Amount" shall have the meaning specified in
subsection 4.4(b).
"Class B Servicing Fee" shall have the meaning specified in Section
3.1.
"Class C Available Funds" shall mean, with respect to any Monthly
Period, an amount equal to the Class C Floating Percentage of the Collections of
Finance Charge Receivables allocated to Series 1998-1 (including any amounts
that are to be treated as Collections of Finance Charge Receivables in
accordance with the Agreement).
"Class C Default Amount" shall mean, with respect to each
Distribution Date, an amount equal to the product of (i) the Investor Default
Amount for the related Monthly Period and (ii) the Class C Floating Percentage
for such Monthly Period.
"Class C Floating Percentage" shall mean, with respect to any
Monthly Period, the percentage equivalent (which percentage shall never exceed
100%) of a fraction, the numerator of which is the Class C Invested Amount as of
the close of business on the last day of the preceding Monthly Period and the
denominator of which is equal to the Invested Amount as of the close of business
on the last day of the preceding Monthly Period; provided, however, that
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with respect to the first Monthly Period, the Class C Floating Percentage shall
mean the percentage equivalent of a fraction, the numerator of which is the
Class C Initial Invested Amount and the denominator of which is the Initial
Invested Amount.
"Class C Initial Invested Amount" shall mean $10,000,000.
"Class C Interests" shall mean an uncertificated fractional
undivided interest in the Trust that shall consist of the right to receive, to
the extent necessary to make the required payments to the Class C Interest
Holder under this Supplement the portion of Collections allocable thereto under
the Agreement and this Supplement, funds on deposit in the Collection Account
allocable thereto pursuant to the Agreement and this Supplement.
"Class C Interest Holder" shall mean the Person in whose name a
Class C Interest is registered in the Book-Entry Register, which initially shall
be the Transferor.
"Class C Interest Rate" shall mean, with respect to each Interest
Period, a per annum rate equal to 0%; provided, however, that such interest rate
may be increased pursuant to the terms of a supplemental agreement entered into
in accordance with Section 4.15.
"Class C Invested Amount" shall mean, for any date of determination,
an amount equal to (a) the Class C Initial Invested Amount, minus (b) an amount
equal to the amount by which the Class C Invested Amount has been reduced on all
prior Distribution Dates pursuant to Section 4.6, minus (c) the aggregate amount
paid pursuant to subsections 4.5(d)(i) and 4.5(e)(iii) prior to such date, and
plus (d) the aggregate amount of Excess Spread, Excess Finance Charge
Collections and Excess Transferor Finance Charge Collections allocated to Series
1998-1 and applied on all prior Distribution Dates pursuant to subsection 4.7(i)
for the purpose of reimbursing amounts deducted pursuant to the foregoing clause
(b); provided, however, that the Class C Invested Amount shall not be reduced
below zero.
"Class C Monthly Interest" shall initially mean $0, and if the Class
C Interests are transferred as provided in Section 4.15, Class C Monthly
Interest shall thereafter mean the interest, if any, distributable in respect of
the Class C Interest as such interest may be calculated in a supplemental
agreement entered into in accordance with Section 4.15.
"Class C Monthly Principal" shall have the meaning specified in
subsection 4.3(c).
"Class C Principal Percentage" shall mean, with respect to any
Monthly Period, a percentage (which shall never exceed 100% or be less than 0%)
equal to the difference between 100% and the sum of the Class A Principal
Percentage and the Class B Principal Percentage for such Monthly Period.
"Class C Servicing Fee" shall have the meaning specified in Section
3.1.
"Closing Date" shall mean March 6, 1998.
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"Controlled Accumulation Amount" shall mean (a) for any Distribution
Date with respect to the Class A Accumulation Period, the Class A Initial
Invested Amount divided by twelve; provided, however, that, if the Class A
Accumulation Period is modified pursuant to Section 4.12, (i) the Controlled
Accumulation Amount for each Distribution Date with respect to the Class A
Accumulation Period shall mean the amount determined in accordance with Section
4.12 on the date on which the Class A Accumulation Period has most recently been
modified and (ii) the sum of the Controlled Accumulation Amounts for all
Distribution Dates with respect to the modified Class A Accumulation Period
shall not be less than the Class A Initial Invested Amount and (b) for any
Distribution Date with respect to the Class B Accumulation Period, the Class B
Initial Invested Amount.
"Controlled Accumulation Date" shall mean the close of business on
January 31, 2002.
"Controlled Accumulation Period" shall mean the Class A Accumulation
Period and the Class B Accumulation Period.
"Controlled Deposit Amount" shall mean, for any Distribution Date
with respect to the Controlled Accumulation Period, an amount equal to the sum
of the Controlled Accumulation Amount for such Distribution Date and any Deficit
Controlled Accumulation Amount from the immediately preceding Distribution Date.
"Covered Amount" shall mean for any Distribution Date with respect
to the Class A Accumulation Period or the first Special Payment Date, if such
Special Payment Date occurs prior to the Class B Principal Commencement Date, an
amount equal to the product of (i) one-twelfth of the Class A Certificate Rate
and (ii) the Principal Funding Account Balance, if any, as of the preceding
Distribution Date.
"Deficit Controlled Accumulation Amount" shall mean (a) on the first
Distribution Date with respect to the Class A Accumulation Period or the Class B
Accumulation Period, the excess, if any, of the Controlled Accumulation Amount
for such Distribution Date over the amount distributed from the Collection
Account as Class A Monthly Principal or Class B Monthly Principal, as the case
may be, for such Distribution Date and (b) on each subsequent Distribution Date
with respect to the Class A Accumulation Period or the Class B Accumulation
Period, the excess, if any, of the Controlled Deposit Amount for such subsequent
Distribution Date over the amount distributed from the Collection Account as the
case may be, for such subsequent Distribution Date.
"Excess Spread" shall mean, with respect to any Distribution Date,
the sum of the amounts, if any, specified pursuant to subsections 4.5(a)(iv),
4.5(b)(iii) and 4.5(c)(ii) with respect to such Distribution Date.
"Finance Charge Shortfall" shall have the meaning specified in
subsection 4.9(a).
"Floating Allocation Percentage" shall mean, with respect to any
Monthly Period, the percentage equivalent (which percentage shall never exceed
100%) of a fraction, the
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numerator of which is the Invested Amount as of the close of business of the
last day of the preceding Monthly Period (or with respect to the first Monthly
Period, the Initial Invested Amount) and the denominator of which is the greater
of (1) the sum of (x) the product of (a) the total amount of Principal
Receivables in the Trust as of such day (or with respect to the first Monthly
Period, at the end of the day on the Closing Date) and (b) one minus the
Discount Percentage and (y) the principal amount on deposit in the Excess
Funding Account as of the end of the day on such date and (2) the sum of the
numerators used to calculate the Series Percentages (as such term is defined in
the Agreement) with respect to Finance Charge Receivables or Defaulted
Receivables, as applicable, for all Series then outstanding; provided, however,
that, with respect to any Monthly Period in which an Addition Date or a Removal
Date occurs and the Servicer need not make daily deposits of Collections into
the Collection Account, the denominator in (x) above shall be the Average
Principal Balance; provided further, however, that with respect to any Monthly
Period in which an Addition Date or a Removal Date occurs and the Servicer is
required to make daily deposits of Collections into the Collection Account, the
denominator in (x) above shall be (1) for the period from and including the
first day of such Monthly Period to but excluding the related Addition Date or
Removal Date, the product of (a) the aggregate amount of Principal Receivables
in the Trust at the end of the day on the last day of the prior Monthly Period
and (b) one minus the Discount Percentage and (2) for the period from and
including the related Addition Date or Removal Date to and including the last
day of such Monthly Period, the product of (a) the aggregate amount of Principal
Receivables in the Trust at the end of the day on the related Addition Date or
Removal Date and (b) one minus the Discount Percentage.
"Group One" shall mean Series 1998-1 and each other Series hereafter
specified in the related Supplement to be included in Group One.
"Initial Invested Amount" shall mean the sum of the Class A Initial
Invested Amount, the Class B Initial Invested Amount and the Class C Initial
Invested Amount.
"Initial Investor Amount" shall mean the sum of the Class A Initial
Investor Amount, the Class B Initial Invested Amount and the Class C Initial
Invested Amount.
"Initial Servicing Fee" shall have the meaning specified in Section
3.1.
"Interest Period" shall mean, with respect to 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.
"Invested Amount" shall mean, as of any date of determination, an
amount equal to the sum of (a) the Class A Invested Amount as of such date, (b)
the Class B Invested Amount as of such date and (c) the Class C Invested Amount
as of such date.
"Investor Amount" shall mean, as of any date of determination, an
amount equal to the sum of (a) the Invested Amount and (b) the Principal Funding
Account Balance.
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"Investor Charge-Offs" shall mean Class A Investor Charge-Offs and
Class B Investor Charge-Offs.
"Investor Default Amount" shall mean, with respect to any
Distribution Date, an amount equal to the product of (a) the Defaulted Amount
for the related Monthly Period and (b) the Floating Allocation Percentage for
such Monthly Period.
"Monthly Interest" means, with respect to any Distribution Date, the
Class A Monthly Interest, the Class B Monthly Interest and the Class C Monthly
Interest for such Distribution Date.
"Monthly Servicing Fee" shall have the meaning specified in Section
3.1.
"Net Portfolio Yield" shall mean, with respect to any Monthly
Period, the annualized percentage equivalent of a fraction, the numerator of
which is equal to the sum, without duplication, of (a) an amount equal to the
product obtained by multiplying the Floating Allocation Percentage with respect
to such Monthly Period and the amount of Collections of Finance Charge
Receivables with respect to such Monthly Period (including any other amounts
that are to be treated as Collections of Finance Charge Receivables in
accordance with the Agreement), plus (b) the amount of any Principal Funding
Investment Proceeds for the related Distribution Date, plus (c) the amount of
funds, if any, to be withdrawn from the Reserve Account which, pursuant to
Section 4.13, are required to be included in Class A Available Funds with
respect to such Distribution Date, minus (d) the Investor Default Amount for the
Distribution Date with respect to such Monthly Period, and the denominator of
which is the Investor Amount as of the last day of the preceding Monthly Period.
"Percentage Allocation" shall have the meaning specified in
subsection 4.1(b)(ii).
"Principal Allocation Percentage" shall mean, with respect to any
Monthly Period:
(a) during the Revolving Period, the percentage equivalent (which
percentage shall never exceed 100%) of a fraction, (x) the numerator of which is
the Invested Amount as of the close of business on the last day of the
immediately preceding Monthly Period (or, in the case of the first Monthly
Period, the Closing Date) and (y) the denominator of which is the greater of (i)
the sum of (A) the product of (1) the total amount of Principal Receivables in
the Trust as of the last day of the immediately preceding Monthly Period and (2)
one minus the Discount Percentage and (B) the principal amount on deposit in the
Excess Funding Account as of such last day (or, in the case of the first Monthly
Period, the Closing Date) and (ii) the sum of the numerators used to calculate
the Series Percentages applicable to Principal Receivables for all Series
outstanding as of the date as to which such determination is being made;
(b) during the Controlled Accumulation Period or the Rapid
Amortization Period, the percentage equivalent (which percentage shall never
exceed 100%) of a fraction, (x) the numerator of which is the Invested Amount as
of the close of business on the last day of the Revolving Period and (y) the
denominator of which is the greater of (i) the sum of (A) the
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product of (1) the total amount of Principal Receivables in the Trust as of the
close of business on the last day of the immediately preceding Monthly Period
and (2) one minus the Discount Percentage and (B) the principal amount on
deposit in the Excess Funding Account as of such last day and (ii) the sum of
the numerators used to calculate the Series Percentages applicable to Principal
Receivables for all Series outstanding as of the date as to which such
determination is being made;
provided, however, that with respect to any Monthly Period in which an Addition
Date or a Removal Date occurs and the Servicer need not make daily deposits of
Collections into the Collection Account, the amount in clause (y) (i) of
paragraphs (a) and (b) above shall be the Average Principal Balance; provided
further, however, that with respect to any Monthly Period in which an Addition
Date or a Removal Date occurs and the Servicer is required to make daily
deposits of Collections into the Collection Account, the amount in clause (y)
(i) of paragraphs (a) and (b) above shall be (1) for the period from and
including the first day of such Monthly Period to but excluding the related
Addition Date or Removal Date, the sum of (x) the product of (I) the aggregate
amount of Principal Receivables in the Trust at the end of the day on the last
day of the prior Monthly Period and (II) one minus the Discount Percentage and
(y) the principal amount on deposit in the Excess Funding Account as of such
last day and (2) for the period from and including the related Addition Date or
Removal Date to and including the last day of such Monthly Period, the sum of
(x) the product of (I) the aggregate amount of Principal Receivables in the
Trust at the end of the day on the related Addition Date or Removal Date and
(II) one minus the Discount Percentage and (y) the principal amount on deposit
in the Excess Funding Account at the end of the day on the related Addition Date
or Removal Date.
"Principal Funding Account" shall have the meaning set forth in
subsection 4.11(a)(i).
"Principal Funding Account Balance" shall mean, with respect to any
date of determination during the Controlled Accumulation Period, the principal
amount, if any, on deposit in the Principal Funding Account on such date of
determination.
"Principal Funding Account Investment Account" shall have the
meaning set forth in subsection 4.11(a)(i).
"Principal Funding Cash Subaccount" shall have the meaning set forth
in subsection 4.11(a)(i).
"Principal Funding Investment Proceeds" shall have the meaning
specified in subsection 4.11(a)(ii).
"Principal Shortfall" shall have the meaning specified in Section
4.10.
"Rapid Amortization Period" shall mean, (a) if on the day on which a
Pay Out Event with respect to Series 1998-1 is deemed to have occurred the
Servicer need not make daily deposits into or withdrawals from the Collection
Account pursuant to subsection 4.03(a) of the Agreement, the period commencing
at the close of business on the Business Day immediately
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preceding the first day of the Monthly Period in which such Pay Out Event is
deemed to have occurred or (b) otherwise, the period commencing at the close of
business on the Business Day immediately preceding the day on which a Pay Out
Event with respect to Series 1998-1 is deemed to have occurred, and ending on
the first to occur of (i) the payment in full to the Class A Certificateholders
and the Class B Certificateholders of the Class A Investor Amount and the Class
B Invested Amount, respectively, and the payment in full to the Class C Interest
Holder of the Class C Invested Amount, if any, or (ii) the Series Termination
Date.
"Reallocated Principal Collections" shall mean, with respect to any
Monthly Period, the product of (a) the Principal Allocation Percentage with
respect to such Monthly Period, (b) the aggregate amount of Collections in
respect of Principal Receivables for such Monthly Period and (c) the sum of the
Class B Principal Percentage and the Class C Principal Percentage with respect
to such Monthly Period.
"Reassignment Amount" shall mean, with respect to any Distribution
Date, after giving effect to any deposits and distributions otherwise to be made
on such Distribution Date, the sum of (i) the Invested Amount on such
Distribution Date, plus (ii) Monthly Interest for such Distribution Date and any
Monthly Interest previously due but not distributed to the Series 1998-1 Holders
on a prior Distribution Date, plus (iii) the amount of Additional Interest, if
any, for such Distribution Date and any Additional Interest previously due but
not distributed to the Series 1998-1 Holders on a prior Distribution Date.
"Required Class C Invested Amount" shall mean, with respect to any
Distribution Date, the greater of (i) the product of (a) the sum of (I) the
Class A Invested Amount and (II) the Class B Invested Amount, each as of such
Distribution Date after taking into account all distributions made on such
Distribution Date, and (b) a fraction, the numerator of which is 4% and the
denominator of which is the excess of 100% over 4% and (ii) the product of (A)
$250,000,000 and (B) 3%; provided, however, that (i) if there are any reductions
in the Class C Invested Amount pursuant to clause (b) of the definition of such
amount, or a Pay Out Event occurs with respect to Series 1998-1 then the
Required Class C Invested Amount for any Distribution Date shall equal the
Required Class C Invested Amount on the Distribution Date immediately preceding
such reduction or Pay Out Event, (ii) in no event shall the Required Class C
Invested Amount exceed the sum of the Class A Invested Amount and the Class B
Invested Amount on any such date, and (iii) the Required Class C Invested Amount
may be reduced without the consent of the Series 1998-1 Holders, if the
Transferors shall have received written notice from each Rating Agency (with a
copy delivered to the Trustee) that such reduction will not result in the
reduction or withdrawal of the then current rating of the Series 1998-1
Certificates and the Transferor shall have delivered to the Trustee an Officer's
Certificate to the effect that, based on the facts known to such officer at such
time, in the reasonable belief of the Transferor, such reduction will not cause
a Pay Out Event or an event that, after the giving of notice or the lapse of
time, would constitute a Pay Out Event, to occur with respect to Series 1998-1.
"Required Reserve Account Amount" shall mean, with respect to any
Distribution Date prior to the Reserve Account Funding Date, $0, and on or after
the Reserve Account Funding Date, an amount equal to (a) the product of (i) 0.5%
of the Class A Investor Amount as
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of the preceding Distribution Date (after giving effect to all changes therein
on such date) and (ii) a fraction, the numerator of which is the number of
Monthly Periods scheduled to be included in the Class A Accumulation Period as
of such date and the denominator of which is twelve (except that if such
numerator is one, the Required Reserve Account Amount determined pursuant to
this clause (a) shall be $0) or (b) any other amount designated by the
Transferor, provided that, if such designation is of a lesser amount, the
Transferor (i) shall have received written notice from each Rating Agency that
such designation will not result in the reduction or withdrawal of the rating of
the Series 1998-1 Certificates and shall have delivered copies of each such
written notice to the Servicer and the Trustee, and (ii) shall have delivered to
the 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 a Pay Out Event or an event that,
after the giving of notice or the lapse of time, would cause a Pay Out Event, to
occur with respect to Series 1998-1.
"Reserve Account" shall have the meaning specified in subsection
4.13(a).
"Reserve Account Cash Subaccount" shall have the meaning specified
in subsection 4.13(a).
"Reserve Account Funding Date" shall mean the Distribution Date with
respect to the Monthly Period which commences three months prior to the Monthly
Period in which, as of the related Determination Date, the Controlled
Accumulation Period is scheduled to commence.
"Reserve Account Investment Account" shall have the meaning
specified in subsection 4.13(a).
"Reserve Account Surplus" shall mean, as of any date of
determination, the amount, if any, by which the amount on deposit in the Reserve
Account exceeds the Required Reserve Account Amount.
"Reserve Draw Amount" shall have the meaning specified in subsection
4.13(c).
"Revolving Period" shall mean the period beginning on the Closing
Date and ending on the earlier of (a) the close of business on the day preceding
the commencement of the Controlled Accumulation Period and (b) the close of
business on the day preceding the commencement of the Rapid Amortization Period.
"Series Invested Amount" shall mean the Invested Amount.
"Series Investor Amount" shall mean, as of any date of
determination, an amount equal to the numerator of the Principal Allocation
Percentage on such date.
"Series 1998-1" shall mean the Series of Investor Certificates, the
terms of which are specified in this Supplement, and shall include the Class A
Certificates, the Class B Certificates and the Class C Interests.
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"Series 1998-1 Certificateholder" shall mean a Class A
Certificateholder or a Class B Certificateholder.
"Series 1998-1 Certificate" shall mean a Class A Certificate or a
Class B Certificate.
"Series 1998-1 Holder" shall mean a Class A Certificateholder, a
Class B Certificateholder or a Class C Interest Holder.
"Series Pay Out Event" shall have the meaning, for Series 1998-1,
specified in Section 6.1.
"Series Percentage" shall mean with respect to Finance Charge
Receivables and Defaulted Receivables, the Floating Allocation Percentage, and
with respect to Principal Receivables, the Principal Allocation Percentage.
"Series Termination Date" shall mean the earlier to occur of (i) the
January 2005 Distribution Date and (ii) the termination of the Trust pursuant to
Section 12.01 of the Agreement.
"Servicing Base Amount" shall have the meaning specified in Section
3.1.
"Servicing Fee Rate" shall mean 2.0%.
"Special Payment Date" shall mean each Distribution Date with
respect to the Rapid Amortization Period.
"Subordinate Principal Collections" shall have the meaning specified
in subsection 4.1(a)(ii).
(b) Notwithstanding anything to the contrary in this Supplement or
the Agreement, the term "Rating Agency" shall mean, whenever used in this
Supplement or the Agreement with respect to Series 1998-1, Moody's and Standard
& Poor's.
(c) All capitalized terms used herein and not otherwise defined
herein have the meanings ascribed to them in the Agreement.
(d) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Supplement shall refer to this Supplement as a
whole and not to any particular provision of this Supplement; references to any
Article, Section or Exhibit are references to Articles, Sections and Exhibits in
or to this Supplement unless otherwise specified; and the term "including" means
"including without limitation."
(e) Unless the context otherwise requires, references in this
Supplement to the Transferor shall initially mean CC Credit Card Corporation in
its capacity as Transferor; and from and after the date any Additional
Transferor is designated pursuant to subsection 2.09(e) of
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the Agreement, such references shall mean CC Credit Card Corporation in its
capacity as Transferor and any such Additional Transferor(s).
ARTICLE III
Servicer and Trustee
Section 3.1. Servicing Compensation.
The share of the Servicing Fee allocable to the Series 1998-1
Holders with respect to any Distribution Date (the "Monthly Servicing Fee"),
shall be equal to one-twelfth the product of (i) the Servicing Fee Rate and (ii)
the Invested Amount, if any, as of the last day of the Monthly Period preceding
such Distribution Date (the amount calculated pursuant to this clause (ii) is
referred to as the "Servicing Base Amount"); provided, however, with respect to
the April 1998 Distribution Date, the Monthly Servicing Fee (the "Initial
Servicing Fee") shall be $347,222.
The share of the Monthly Servicing Fee allocable to the Class A
Certificateholders with respect to any Distribution Date (the "Class A Servicing
Fee"), shall be equal to one-twelfth of the product of (a) the Class A Floating
Percentage, (b) the Servicing Fee Rate and (c) the Servicing Base Amount;
provided, however, that with respect to the April 15, 1998 Distribution Date,
the Class A Servicing Fee shall be $315,972. The share of the Monthly Servicing
Fee allocable to the Class B Certificateholders with respect to any Distribution
Date (the "Class B Servicing Fee"), shall be equal to one-twelfth of the product
of (a) the Class B Floating Percentage, (b) the Servicing Fee Rate and (c) the
Servicing Base Amount; provided, however, that with respect to the April 15,
1998 Distribution Date, the Class B Servicing Fee shall be $17,361. The share of
the Monthly Servicing Fee allocable to the Class C Interest Holder with respect
to any Distribution Date (the "Class C Servicing Fee"), shall be equal to
one-twelfth of the product of (a) the Class C Floating Percentage, (b) the
Servicing Fee Rate and (c) the Servicing Base Amount; provided, however, that
with respect to the April 15, 1998 Distribution Date, the Class C Servicing Fee
shall be $13,889. The remainder of the Servicing Fee shall be paid by the
Holders of the Transferor Certificates or the Certificateholders of other Series
(as provided in the related Supplements) and in no event shall the Trust, the
Trustee or the Series 1998-1 Holders be liable for the share of the Servicing
Fee to be paid by the Holders of the Transferor Certificates or the
Certificateholders of any other Series. The Class A Servicing Fee shall be
payable to the Servicer solely to the extent amounts are available for
distribution in respect thereof pursuant to subsection 4.5(a)(ii), 4.7(a) or
4.8(a); the Class B Servicing Fee shall be payable solely to the extent amounts
are available for distribution in respect thereof pursuant to subsection
4.5(b)(ii), 4.7(c) or 4.8(b); and the Class C Servicing Fee shall be payable
solely to the extent amounts are available for distribution in respect thereof
pursuant to subsection 4.5(c)(i) or 4.7(g).
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ARTICLE IV
Rights of Series 1998-1 Certificateholders and Class C Interest
Holder and Allocation and Application of Collections
Section 4.1. Collections and Allocations. Unless the Servicer is
allowed to make a single monthly deposit in the Collection Account as provided
in subsection 4.03(a) of the Agreement, in which case the Servicer will apply,
or will instruct the Trustee to apply, the following amounts for the entire
Monthly Period no later than the related Transfer Date, the Servicer will apply,
or will instruct the Trustee to apply, all collections and other funds on
deposit in the Collection Account that are allocated to the Series 1998-1
Holders as follows:
(a) Daily Allocations During the Revolving Period. During the
Revolving Period, the Servicer shall, on or prior to the close of business on
the second Business Day following any Date of Processing, allocate the following
amounts as set forth below:
(i) Allocate to the Series 1998-1 Holders the product of (x)
the Floating Allocation Percentage on such Date of Processing and
(y) the aggregate amount of Collections of Finance Charge
Receivables on such Date of Processing, and of that allocation,
deposit and retain in the Collection Account an amount equal to
Monthly Interest for the related Distribution Date (plus, if
Travelers Bank & Trust, fsb is not the Servicer, the Monthly
Servicing Fee for such Monthly Period);
(ii) Allocate to the Series 1998-1 Holders an amount equal to
the product of (A) the Principal Allocation Percentage on such Date
of Processing and (B) the aggregate amount of Collections of
Principal Receivables on such Date of Processing, which amount shall
be first, if any other Principal Sharing Series in Group One is
outstanding and in its Amortization Period or Accumulation Period
(as such terms are defined in the Agreement), retained in the
Collection Account for application, to the extent necessary, as
Shared Principal Collections in accordance with Section 4.04 of the
Agreement to other Series in Group One on the related Distribution
Date, and second paid to the Holders of the Transferor Certificates;
provided however, that the amount to be paid to the Holders of the
Transferor Certificates pursuant to this subsection 4.1(a)(ii) on
any Date of Processing shall be paid to such Holders only if the
Transferor Amount on such Date of Processing is greater than the
Required Transferor Amount and an amount equal to the product of (I)
the aggregate amount of Principal Receivables and (II) one minus the
Discount Percentage is greater than the Required Principal Balance
(after giving effect to all Principal Receivables transferred to the
Trust on such day and any amounts deposited in the Excess Funding
Account on such day) and otherwise shall be deposited in the Excess
Funding Account until the Transferor Amount is greater than the
Required Transferor Amount and an amount equal to the product of (I)
the aggregate amount of Principal Receivables and (II) one minus the
Discount Percentage is greater than the Required Principal Balance
and applied in accordance with Section 4.02 of the Agreement and the
remainder shall
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be paid to the Holders of the Transferor Certificates; provided
further, however, that if and for so long as the Class C Invested
Amount is less than the Required Class C Invested Amount during a
Monthly Period, an amount equal to the sum of (x) the Class C
Principal Percentage of the product of the Principal Allocation
Percentage and the aggregate amount of Collections of Principal
Receivables and (y) the Class B Principal Percentage of the product
of the Principal Allocation Percentage and the aggregate amount of
Collections of Principal Receivables ("Subordinate Principal
Collections") on each Date of Processing with respect to such
Monthly Period shall be deposited and retained in the Collection
Account during such Monthly Period.
(b) Daily Allocations During the Controlled Accumulation Period.
During the Controlled Accumulation Period, the Servicer shall, prior to the
close of business on the second Business Day following any Date of Processing,
allocate the following amounts as set forth below:
(i) Allocate to the Series 1998-1 Holders and deposit and
retain in the Collection Account an amount equal to the product of
(A) the Floating Allocation Percentage on such Date of Processing
and (B) the aggregate amount of Collections of Finance Charge
Receivables on such Date of Processing.
(ii) Allocate to the Series 1998-1 Holders and deposit and
retain in the Collection Account an amount equal to the product of
(x) the Principal Allocation Percentage on such Date of Processing
and (y) the aggregate amount of Collections of Principal Receivables
on such Date of Processing (for any such date, a "Percentage
Allocation"); provided, however, that if the sum of such Percentage
Allocations with respect to the same Monthly Period exceeds the
Controlled Deposit Amount 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 in Group One
is outstanding and in its Amortization Period or Accumulation Period
(as such terms are defined in the Agreement), retained in the
Collection Account for application, to the extent necessary, as
Shared Principal Collections in accordance with Section 4.04 of the
Agreement to other Series in Group One on the related Distribution
Date, and second paid to the Holders of the Transferor Certificates
only if the Transferor Amount on such Date of Processing is greater
than the Required Transferor Amount and an amount equal to the
product of (I) the aggregate amount of Principal Receivables and
(II) one minus the Discount Percentage is greater than the Required
Principal Balance (after giving effect to all Principal Receivables
transferred to the Trust on such day and any amounts deposited in
the Excess Funding Account on such day) and otherwise shall be
deposited in the Excess Funding Account until the Transferor Amount
is greater than the Required Transferor Amount and an amount equal
to the product of (I) the aggregate amount of Principal Receivables
and (II) one minus the Discount Percentage is greater than the
Required Principal Balance and applied in accordance with Section
4.02 of the Agreement and the remainder shall be paid to the Holders
of the Transferor Certificates; provided further, however,
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that if and for so long as the Class C Invested Amount is less than
the Required Class C Invested Amount for a Monthly Period,
Subordinate Principal Collections with respect to each Date of
Processing with respect to such Monthly Period shall be retained in
the Collection Account during such Monthly Period.
(c) Daily Allocations During the Rapid Amortization Period. During
the Rapid Amortization Period, the Servicer shall, prior to the close of
business on the second Business Day following any Date of Processing, allocate
the following amounts as set forth below:
(i) Allocate to the Series 1998-1 Holders and deposit and
retain in the Collection Account an amount equal to the product of
(A) the Floating Allocation Percentage on such Date of Processing
and (B) the aggregate amount of Collections of Finance Charge
Receivables on such Date of Processing.
(ii) Allocate to the Series 1998-1 Holders and deposit and
retain in the Collection Account an amount equal to the product of
(A) the Principal Allocation Percentage on such Date of Processing
and (B) the aggregate amount of Collections of Principal Receivables
on such Date of Processing; provided, however, that after the date
on which an amount of such Collections equal to the Investor Amount
has been deposited into the Collection Account and allocated to the
Series 1998-1 Holders, the amount determined in accordance with this
subparagraph (ii) in excess thereof shall be first, if any other
Principal Sharing Series in Group One is outstanding and in its
Amortization Period or Accumulation Period (as such terms are
defined in the Agreement), retained in the Collection Account for
application, to the extent necessary, as Shared Principal
Collections in accordance with Section 4.04 of the Agreement to
other Series in Group One on the related Distribution Date, and
second paid to the Holders of the Transferor Certificates only if
the Transferor Amount on such Date of Processing is greater than the
Required Transferor Amount and an amount equal to the product of (I)
the aggregate amount of Principal Receivables and (II) one minus the
Discount Percentage is greater than the Required Principal Balance
(after giving effect to all Principal Receivables transferred to the
Trust on such day and any amounts deposited in the Excess Funding
Account on such day) and otherwise shall be deposited in the Excess
Funding Account until the Transferor Amount is greater than the
Required Transferor Amount and an amount equal to the product of (I)
the aggregate amount of Principal Receivables and (II) one minus the
Discount Percentage is greater than the Required Principal Balance
and applied in accordance with Section 4.02 of the Agreement and the
remainder shall be paid to the Holders of the Transferor
Certificates.
(d) Notwithstanding the foregoing, the Servicer shall deposit in the
Collection Account no later than the related Distribution Date an amount equal
to the excess of the amount allocated to Series 1998-1 over the amount allocated
to Series 1998-1 and deposited in the Collection Account to the extent such
amounts are required to be distributed to or for the benefit of the Series
1998-1 Holders or to other Series; provided, that so long as Travelers Bank &
Trust,
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fsb is the Servicer, Travelers Bank & Trust, fsb, as Servicer and as agent for
the Holders of the Transferor Certificates may make such deposit net of all such
amounts payable to the Servicer or the Holders of the Transferor Certificates.
Section 4.2 Determination of Monthly Interest. The amount of monthly
interest ("Class A Monthly Interest") distributable from the Collection Account
with respect to the Class A Certificates on each Distribution Date shall be an
amount equal to the one-twelfth of the product of (i) the Class A Certificate
Rate and (ii) the outstanding principal amount of the Class A Certificates as of
the close of business on the preceding Record Date; provided, however, with
respect to the first Distribution Date, Class A Monthly Interest shall be equal
to the interest accrued on the Class A Initial Investor Amount at the Class A
Certificate Rate for the period from the Closing Date through April 14, 1998
(assuming that the month of March has 30 days).
On the Determination Date preceding each Distribution Date, the
Servicer shall determine the excess, if any (the "Class A Interest Shortfall"),
of (x) the Class A Monthly Interest for such Distribution Date over (y) the
aggregate amount of funds allocated and available to pay such Class A Monthly
Interest on such Distribution Date. If the Class A Interest Shortfall with
respect to any Distribution Date is greater than zero, an additional amount
("Class A Additional Interest") equal to one-twelfth of the product of (i) the
Class A Penalty Rate and (ii) such Class A Interest Shortfall (or the portion
thereof which has not been paid to the Class A Certificateholders) shall be
payable as provided herein with respect to the Class A Certificates on each
Distribution Date following such Distribution Date to and including the
Distribution Date on which such Class A Interest Shortfall is paid to the Class
A Certificateholders. Notwithstanding anything to the contrary herein, Class A
Additional Interest shall be payable or distributed to Class A
Certificateholders only to the extent permitted by applicable law.
Section 4.3. Determination of Monthly Principal.
(a) The amount of monthly principal ("Class A Monthly Principal")
distributable from the Collection Account with respect to the Class A
Certificates on each Distribution Date, beginning with the first Distribution
Date with respect to the Class A Accumulation Period or the Rapid Amortization
Period, shall be equal to the least of (x) the Available Investor Principal
Collections on deposit in the Collection Account with respect to such
Distribution Date, (y) for each Distribution Date with respect to the Class A
Accumulation Period (and on or prior to the Class A Expected Final Distribution
Date), the Controlled Deposit Amount for such Distribution Date and (z) the
Class A Invested Amount on such Distribution Date.
(b) The amount of monthly principal ("Class B Monthly Principal")
distributable from the Collection Account with respect to the Class B
Certificates on each Distribution Date, beginning with the Class B Principal
Commencement Date, shall be equal to the least of (x) the Available Investor
Principal Collections on deposit in the Collection Account with respect to such
Distribution Date (minus the portion of such Available Investor Principal
Collections applied to Class A Monthly Principal on such Distribution Date), (y)
for each Distribution Date with respect to the Class B Accumulation Period on or
prior to the Class B
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Expected Final Distribution Date, the Controlled Deposit Amount for such
Distribution Date and (z) the Class B Invested Amount on such Distribution Date.
(c) The amount, if any, of monthly principal ("Class C Monthly
Principal") distributable with respect to the Class C Invested Amount on each
Distribution Date shall equal the following amounts:
(i) on any Distribution Date prior to the Distribution Date on
which the Class B Invested Amount is paid in full, shall be an
amount equal to the lesser of (A) Available Investor Principal
Collections not applied to Class A Monthly Principal or Class B
Monthly Principal on such Distribution Date and (B) the positive
excess, if any, of the Class C Invested Amount over the Required
Class C Invested Amount for such Distribution Date (calculated after
giving effect to all distributions on such Distribution Date but
before giving effect to the payment of Class C Monthly Principal on
such Distribution Date); and
(ii) for each Distribution Date beginning on the Distribution
Date on which the Class B Invested Amount is paid in full, shall be
an amount equal to the Available Investor Principal Collections with
respect to such Distribution Date (minus the portion of such
Available Investor Principal Collections applied to Class A Monthly
Principal and Class B Monthly Principal on such Distribution Date);
provided, however, with respect to any Distribution Date, Class C Monthly
Principal shall not exceed the Class C Invested Amount.
Section 4.4. Required Amount.
(a) With respect to each Distribution Date, on the related
Determination Date, the Servicer shall determine the amount (the "Class A
Required Amount"), if any, by which (a) the sum of (i) Class A Monthly Interest
for such Distribution Date, (ii) any Class A Monthly Interest previously due but
not paid to the Class A Certificateholders on a prior Distribution Date, (iii)
any Class A Additional Interest for such Distribution Date and any Class A
Additional Interest previously due but not paid to the Class A
Certificateholders on a prior Distribution Date, (iv) the Class A Servicing Fee
for such Distribution Date, (v) any Class A Servicing Fee previously due but not
paid to the Servicer and (vi) the Class A Investor Default Amount, if any, for
such Distribution Date exceeds (b) the Class A Available Funds. In the event
that the Class A Required Amount for such Distribution Date is greater than
zero, all or a portion of the Excess Spread, Excess Finance Charge Collections
and Excess Transferor Finance Charge Collections allocated to Series 1998-1 with
respect to the related Monthly Period in an amount equal to the Class A Required
Amount for such Distribution Date shall be distributed from the Collection
Account on such Distribution Date pursuant to subsection 4.7(a). In the event
that the Class A Required Amount for such Distribution Date exceeds the amount
of Excess Spread, Excess Finance Charge Collections and Excess Transferor
Finance Charge Collections allocated to Series 1998-1 with respect to the
related Monthly Period, all or a portion of the Reallocated Principal
Collections with respect to such Monthly Period in an amount equal to such
excess
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shall be distributed from the Collection Account on such Distribution
Date pursuant to subsection 4.8(a).
(b) With respect to each Distribution Date on the related
Determination Date, the Servicer shall determine the amount (the "Class B
Required Amount") equal to the sum of (I) the amount, if any, by which (a) the
sum of (i) Class B Monthly Interest for such Distribution Date, (ii) any Class B
Monthly Interest previously due but not paid to the Class B Certificateholders
on a prior Distribution Date, (iii) any Class B Additional Interest for such
Distribution Date and any Class B Additional Interest previously due but not
paid to the Class B Certificateholders on a prior Distribution Date, (iv) the
Class B Servicing Fee for such Distribution Date and (v) any Class B Servicing
Fee previously due but not paid to the Servicer exceeds (b) the Class B
Available Funds plus (II) the Class B Investor Default Amount for such
Distribution Date. In the event that the Class B Required Amount for such
Distribution Date is greater than zero, all or a portion of Excess Spread,
Excess Finance Charge Collections and Excess Transferor Finance Charge
Collections allocated to Series 1998-1 (other than Excess Spread, Excess Finance
Charge Collections and Excess Transferor Finance Charge Collections allocated to
Series 1998-1 applied pursuant to subsections 4.7(a) and (b) with respect to
such Distribution Date) with respect to the related Monthly Period shall be
applied to fund the Class B Required Amount. In the event that the Class B
Required Amount for such Distribution Date exceeds the amount of Excess Spread,
Excess Finance Charge Collections and Excess Transferor Finance Charge
Collections allocated to Series 1998-1 with respect to such Monthly Period and
available to fund the Class B Required Amount as provided in the preceding
sentence, all or a portion of the Reallocated Principal Collections allocable to
the Class C Invested Amount available therefor with respect to such Monthly
Period in an amount equal to such excess be distributed from the Collection
Account on such Distribution Date pursuant to subsection 4.8(b).
Section 4.5. Application of Class A Available Funds, Class B
Available Funds, Class C Available Funds and Available Investor Principal
Collections. The Servicer shall apply or shall cause the Trustee to apply, on
each Distribution Date, Class A Available Funds, Class B Available Funds, Class
C Available Funds and Available Investor Principal Collections for the Monthly
Period with respect to such Distribution Date to make the following
distributions:
(a) On each Distribution Date, an amount equal to the Class A
Available Funds with respect to such Distribution Date will be distributed in
the following priority:
(i) an amount equal to Class A Monthly Interest for such
Distribution Date, plus the amount of any Class A Monthly Interest
previously due but not distributed to the Class A Certificateholders
on a prior Distribution Date, plus the amount of any 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 Certificateholders on a prior Distribution Date, shall
be distributed to the Paying Agent for payment to the Class A
Certificateholders;
(ii) an amount equal to the Class A Servicing Fee for
such Distribution Date, plus the amount of any Class A Servicing Fee
previously due
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but not distributed to the Servicer on a prior Distribution Date,
shall be distributed to the Servicer;
(iii) an amount equal to the Class A Investor Default
Amount for such Distribution Date shall be treated as a portion of
Available Investor Principal Collections for such Distribution Date;
and
(iv) the balance, if any, shall constitute Excess Spread
and shall be allocated and distributed as set forth in Section 4.7.
(b) On each Distribution Date, an amount equal to the Class B
Available Funds with respect to such Distribution Date will be distributed in
the following priority:
(i) an amount equal to Class B Monthly Interest for such
Distribution Date, plus the amount of any Class B Monthly Interest
previously due but not distributed to the Class B Certificateholders on a
prior Distribution Date, plus the amount of any Class B Additional
Interest for such Distribution Date and any Class B Additional Interest
previously due but not distributed to the Class B Certificateholders on a
prior Distribution Date, shall be distributed to the Paying Agent for
payment to the Class B Certificateholders;
(ii) an amount equal to the Class B Servicing Fee for such
Distribution Date, plus the amount of any Class B Servicing Fee previously
due but not distributed to the Servicer on a prior Distribution Date,
shall be distributed to the Servicer; and
(iii) the balance, if any, shall constitute Excess Spread and
shall be allocated and distributed as set forth in Section 4.7.
(c) On each Distribution Date, an amount equal to the Class C
Available Funds with respect to such Distribution Date will be distributed in
the following priority:
(i) if Travelers Bank & Trust, fsb or the Trustee is no longer
the Servicer, an amount equal to the Class C Servicing Fee for such
Distribution Date, plus the amount of any Class C Servicing Fee
previously due but not distributed to the Servicer on a prior
Distribution Date, shall be distributed to the Servicer; and
(ii) the balance, if any, shall constitute Excess Spread and
shall be allocated and distributed as set forth in Section 4.7.
(d) On each Distribution Date with respect to the Revolving Period,
an amount equal to the Available Investor Principal Collections for the related
Monthly Period shall be distributed in the following order of priority:
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(i) an amount equal to Class C Monthly Principal for such
Distribution Date, up to the Class C Invested Amount on such
Distribution Date, shall be distributed to the Class C Interest
Holder; and
(ii) the balance, if any, shall be treated as a portion of
Shared Principal Collections and applied in accordance with Section
4.04 of the Agreement.
(e) On each Distribution Date with respect to the Controlled
Accumulation Period or the Rapid Amortization Period, an amount equal to the
Available Investor Principal Collections for the related Monthly Period shall be
distributed in the following priority:
(i) an amount equal to Class A Monthly Principal for such
Distribution Date, up to the Class A Invested Amount on such
Distribution Date, shall be deposited in the Principal Funding
Account for payment to the Class A Certificateholders by the Paying
Agent on each Distribution Date beginning on the earlier to occur of
the Class A Expected Final Distribution Date or the first Special
Payment Date;
(ii) for each Distribution Date beginning on the Class B
Principal Commencement Date, an amount equal to Class B Monthly
Principal for such Distribution Date, up to the Class B Invested
Amount on such Distribution Date, shall be distributed to the Paying
Agent for payment to the Class B Certificateholders;
(iii) an amount equal to Class C Monthly Principal for such
Distribution Date, up to the Class C Invested Amount on such
Distribution Date, shall be distributed to the Class C Interest
Holder; and
(iv) for each Distribution Date, after giving effect to
paragraphs (i), (ii) and (iii) above, an amount equal to the
balance, if any, of such Available Investor Principal Collections
then on deposit in the Collection Account shall be treated as Shared
Principal Collections and applied in accordance with Section 4.04 of
the Agreement.
Section 4.6. Default Amounts; Investor Charge-Offs.
(a) On each Determination Date, the Servicer shall calculate the
Class A Investor Default Amount, if any, for the related Distribution Date. If,
on any Distribution Date, the Class A Required Amount for the related Monthly
Period exceeds the sum of (x) the amount of Reallocated Principal Collections
with respect to such Monthly Period and (y) the amount of Excess Spread, Excess
Finance Charge Collections and Excess Transferor Finance Charge Collections
allocable to Series 1998-1 with respect to such Distribution Date, the Class C
Invested Amount shall be reduced by the amount of such excess, but not by more
than the excess of the Class A Investor Default Amount for such Distribution
Date over the amount of Reallocated Principal Collections and Excess Spread,
Excess Finance Charge Collections and Excess Transferor Finance Charge
Collections allocable to Series 1998-1. In the event that such
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reduction would cause the Class C Invested Amount to be a negative number, the
Class C Invested Amount shall be reduced to zero and the Class B Invested Amount
shall be reduced by the amount by which the Class C Invested Amount would have
been reduced below zero, but not by more than the excess, if any, of the Class A
Investor Default Amount for such Distribution Date over the amount of such
reduction, if any, of the Class C Invested Amount with respect to such
Distribution Date and the amount of Reallocated Principal Collections and Excess
Spread, Excess Finance Charge Collections and Excess Transferor Finance Charge
Collections allocable to Series 1998-1 used to fund the Class A Investor Default
Amount for such Distribution Date. In the event that such reduction would cause
the Class B Invested Amount to be a negative number, the Class B Invested Amount
shall be reduced to zero, and the Class A Invested Amount shall be reduced by
the amount by which the Class B Invested Amount would have been reduced below
zero, but not by more than the excess, if any, of the Class A Investor Default
Amount for such Distribution Date over the aggregate amount of the reductions,
if any, of the Class C Invested Amount and the Class B Invested Amount for such
Distribution Date and the amount of Reallocated Principal Collections and Excess
Spread, Excess Finance Charge Collections and Excess Transferor Finance Charge
Collections allocable to Series 1998-1 used to fund the Class A Investor Default
Amount for such Distribution Date (a "Class A Investor Charge-Off"). Class A
Investor Charge-Offs shall thereafter be reimbursed and the Class A Invested
Amount increased (but not by an amount in excess of the aggregate unreimbursed
Class A Investor Charge-Offs) on any Distribution Date by the amount of Excess
Spread, Excess Finance Charge Collections and Excess Transferor Finance Charge
Collections allocable to Series 1998-1 and applied for that purpose pursuant to
subsection 4.7(b).
(b) On each Determination Date, the Servicer shall calculate the
Class B Required Amount, if any, for the related Distribution Date. If, on any
Distribution Date, the Class B Required Amount for such Distribution Date
exceeds the sum of (x) the amount of Excess Spread, Excess Finance Charge
Collections and Excess Transferor Finance Charge Collections allocable to Series
1998-1 with respect to the related Monthly Period which are not used to fund the
Class A Required Amount and Class A Investor Charge-Offs on the related
Distribution Date and (y) the amount of Reallocated Principal Collections
allocable to the Class C Invested Amount which are available to fund the Class B
Required Amount on such Distribution Date pursuant to subsection 4.8(b), then
the Class C Invested Amount shall be reduced by the amount of such excess, but
not by more than the excess of the Class B Investor Default Amount for such
Distribution Date over the amount of Reallocated Principal Collections and
Excess Spread, Excess Finance Charge Collections and Excess Transferor Finance
Charge Collections allocable to Series 1998-1 used to fund the Class B Investor
Default Amount for such Distribution Date. In the event that such reduction
would cause the Class C Invested Amount to be a negative number, the Class C
Invested Amount shall be reduced to zero, and the Class B Invested Amount shall
be reduced by the amount by which the Class C Invested Amount would have been
reduced below zero, but not by more than the excess, if any, of the Class B
Investor Default Amount for such Distribution Date over the amount of such
reduction, if any, of the Class C Invested Amount with respect to such
Distribution Date and the amount of Reallocated Principal Collections and Excess
Spread, Excess Finance Charge Collections and Excess Transferor Finance Charge
Collections allocable to Series 1998-1 used to fund the Class B Investor Default
Amount for such Distribution Date (a "Class B Investor Charge-Off"). Class B
Investor Charge-Offs shall thereafter be reimbursed and the Class B Invested
Amount
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increased (but not by an amount in excess of the aggregate unreimbursed Class B
Investor Charge-Offs) on any Distribution Date by the amount of Excess Spread,
Excess Finance Charge Collections and Excess Transferor Finance Charge
Collections allocable to Series 1998-1 allocated and available for that purpose
pursuant to subsection 4.7(e).
(c) If, on any Distribution Date, Reallocated Principal Collections
for such Distribution Date are applied pursuant to subsection 4.8(a) or (b), the
Class C Invested Amount shall be reduced by the amount of such Reallocated
Principal Collections. In the event that such reduction would cause the Class C
Invested Amount to be a negative number, the Class C Invested Amount shall be
reduced to zero, and the Class B Invested Amount shall be reduced by the amount
by which the Class C Invested Amount would have been reduced below zero.
(d) If, on any Distribution Date, the Class C Default Amount exceeds
the amount of Excess Spread, Excess Finance Charge Collections and Excess
Transferor Finance Charge Collections allocable to Series 1998-1 available to
fund the Class C Default Amount pursuant to subsection 4.7(h) on such
Distribution Date, then the Class C Invested Amount shall be reduced by the
amount of such excess.
Section 4.7. Excess Spread; Excess Finance Charge Collections;
Excess Transferor Finance Charge Collections. The Servicer shall apply or shall
cause the Trustee to apply, on each Distribution Date, Excess Spread, Excess
Finance Charge Collections and Excess Transferor Finance Charge Collections
allocable to Series 1998-1 for such Distribution Date to make the following
distributions in the following priority:
(a) an amount equal to the Class A Required Amount, if any, with
respect to such Distribution Date shall be distributed by the Trustee to fund
any deficiency pursuant to subsections 4.5(a)(i), (ii) and (iii), in that order
of priority;
(b) an amount equal to the aggregate amount of Class A Investor
Charge-Offs that have not been previously reimbursed shall be treated as a
portion of Available Investor Principal Collections for such Distribution Date;
(c) an amount equal to any deficiency in the amounts to be
distributed pursuant to subsections 4.5(b)(i) and (ii) with respect to such
Distribution Date shall be distributed by the Trustee to fund such deficiency in
accordance with the provisions of subsections 4.5(b)(i) and (ii) and in that
order of priority;
(d) an amount equal to the Class B Investor Default Amount for such
Distribution Date shall be treated as a portion of Available Investor Principal
Collections for such Distribution Date;
(e) an amount equal to the aggregate amount by which the Class B
Invested Amount has been reduced pursuant to clauses (c), (d) and (e) of the
definition of "Class B Invested Amount" in Section 2.1 of this Supplement (but
not in excess of the aggregate amount of such reductions which have not been
previously reimbursed) shall be treated as a portion of Available Investor
Principal Collections for such Distribution Date;
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(f) an amount equal to the Class C Monthly Interest, if any, for
such Distribution Date, plus the amount of any Class C Monthly Interest
previously due but not distributed to the Class C Interest Holder on a prior
Distribution Date shall be distributed to the Class C Interest Holder;
(g) an amount equal to the Class C Servicing Fee for such
Distribution Date (or if Travelers Bank & Trust, fsb or the Trustee is no longer
the Servicer, the portion of the Class C Servicing Fee for such Distribution
Date not paid pursuant to subsection 4.5(c)(i)), plus the amount of any Class C
Servicing Fee previously due but not distributed to the Servicer on a prior
Distribution Date, shall be distributed to the Servicer;
(h) an amount equal to the Class C Default Amount for such
Distribution Date shall be treated as a portion of Available Investor Principal
Collections with respect to such Distribution Date;
(i) an amount equal to the aggregate amount by which the Class C
Invested Amount has been reduced pursuant to clause (b) of the definition of
"Class C Invested Amount" (but not in excess of the aggregate amount of such
reductions which have not been previously reimbursed) shall be treated as a
portion of Available Investor Principal Collections with respect to such
Distribution Date;
(j) an amount up to the excess, if any, of the Required Reserve
Account Amount over the amount on deposit therein, shall be deposited into the
Reserve Account;
(k) the balance, if any, shall constitute a portion of "Excess
Finance Charge Collections" available for allocation to other Series in Group
One or to the Holders of the Transferor Certificates for such Distribution Date
as described in Section 4.04 of the Agreement.
Section 4.8. Reallocated Principal Collections. The Servicer shall
apply or shall cause the Trustee to apply on each Distribution Date, Reallocated
Principal Collections (applying all such Collections with respect to the Class C
Invested Amount prior to applying any such Collections with respect to the Class
B Invested Amount and applying no such Collections with respect to the Class B
Invested Amount pursuant to clause (b) below) with respect to such Distribution
Date, to make the following distributions in the following priority:
(a) an amount equal to the excess, if any, of (i) the Class A
Required Amount, if any, with respect to such Distribution Date over (ii) the
amount of Excess Spread, Excess Finance Charge Collections and Excess Transferor
Finance Charge Collections allocable to Series 1998-1 with respect to the
related Monthly Period shall be distributed by the Trustee to fund any
deficiency pursuant to subsections 4.5(a)(i), (ii) and (iii), in that order of
priority;
(b) an amount equal to the excess, if any, of (i) the Class B
Required Amount, if any, with respect to such Distribution Date over (ii) the
amount of Excess Spread, Excess Finance Charge Collections and Excess Transferor
Finance Charge Collections allocable to Series 1998-1 and applied to the Class B
Certificates pursuant to subsections 4.7(c) and (d) on
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such Distribution Date shall be distributed by the Trustee to fund any
deficiency pursuant to subsections 4.5(b)(i) and (ii) and subsection 4.7(d), in
that order of priority; and
(c) the balance, if any, of such Reallocated Principal Collections
shall be treated as a portion of Available Investor Principal Collections.
Section 4.9. Excess Finance Charge Collections and Excess Transferor
Finance Charge Collections.
(a) Subject to subsection 4.04(b) of the Agreement, Excess Finance
Charge Collections with respect to the Series in Group One for any Distribution
Date will be allocated to Series 1998-1 in an amount equal to the product of (x)
the aggregate amount of Excess Finance Charge Collections with respect to all
the Series in Group One for such Distribution Date and (y) a fraction, the
numerator of which is the Finance Charge Shortfall for Series 1998-1 for such
Distribution Date and the denominator of which is the aggregate amount of
Finance Charge Shortfalls (as defined in the related Supplements) for all the
Series in Group One for such Distribution Date. The "Finance Charge Shortfall"
for Series 1998-1 for any Distribution Date shall be equal to the excess, if
any, of (a) the full amount required to be paid, without duplication, pursuant
to subsections 4.5(a), 4.5(b) and 4.5(c) and Section 4.7 (except for subsection
4.7(k)) on such Distribution Date over (b) the sum of Class A Available Funds,
Class B Available Funds and Class C Available Funds with respect to the related
Monthly Period.
(b) Subject to subsection 4.04(c) of the Agreement, Excess
Transferor Finance Charge Collections for any Distribution Date will be
allocated to Series 1998-1 in an amount equal to the product of (x) the Excess
Transferor Finance Charge Collections for such Distribution Date and (y) a
fraction, the numerator of which is the Finance Charge Shortfall for Series
1998-1 for such Distribution Date and the denominator of which is the aggregate
amount of Finance Charge Shortfalls (as defined in the related Supplements) for
all Series entitled to receive Excess Transferor Finance Charge Collections for
such Distribution Date, in each case after applying Excess Finance Charge
Collections, if any, to each such Series (including Series 1998-1).
Section 4.10. Shared Principal Collections and Shared Transferor
Principal Collections.
(a) Subject to subsection 4.04(a) of the Agreement, Shared Principal
Collections with respect to the Series in Group One for any Distribution Date
will be allocated to Series 1998-1 in an amount equal to the product of (x) the
aggregate amount of Shared Principal Collections with respect to all Principal
Sharing Series in Group One for such Distribution Date and (y) a fraction, the
numerator of which is the Principal Shortfall for Series 1998-1 for such
Distribution Date and the denominator of which is the aggregate amount of
Principal Shortfalls for all the Series in Group One that are Principal Sharing
Series for such Distribution Date. The "Principal Shortfall" for Series 1998-1
shall be equal to (a) for any Distribution Date with respect to the Revolving
Period, zero, (b) for any Distribution Date with respect to the Controlled
Accumulation Period (on or prior to the Class B Expected Final Distribution
Date), the excess, if any, of the Controlled Deposit Amount with respect to such
Distribution Date over the amount of
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Available Investor Principal Collections for such Distribution Date (excluding
any portion thereof attributable to Shared Principal Collections or Shared
Transferor Principal Collections) and (c) for each Distribution Date with
respect to the Rapid Amortization Period or the Controlled Accumulation Period
after the Class B Expected Final Distribution Date, the excess, if any, of the
Invested Amount over the amount of Available Investor Principal Collections for
such Distribution Date (excluding any portion thereof attributable to Shared
Principal Collections or Shared Transferor Principal Collections).
(b) Subject to subsection 4.04(d) of the Agreement, Shared
Transferor Principal Collections for any Distribution Date will be allocated to
Series 1998-1 in an amount equal to the product of (x) Shared Transferor
Principal Collections and (y) a fraction, the numerator of which is the
Principal Shortfall for Series 1998-1 and the denominator of which is the
aggregate amount of Principal Shortfalls (as defined in the related Supplements)
for all Series entitled to receive Shared Transferor Principal Collections for
such Distribution Date, in each case after applying Shared Principal
Collections, if any, to each such Series (including Series 1998-1).
Section 4.11. Principal Funding Account.
(a) (i) The Servicer, for the benefit of the Series 1998-1
Certificateholders, shall establish and maintain in the name of the
Trustee, on behalf of the Trust, a Qualified Account with the Securities
Intermediary (the "Principal Funding Account"), bearing a designation
clearly indicating that the funds and other property credited thereto are
held for the benefit of the Series 1998-1 Certificateholders. The
Principal Funding Account shall consist of two segregated subaccounts: (I)
the "Principal Funding Account Investment Account" to which financial
assets credited to the Principal Funding Account shall be credited, and as
to which financial assets the Securities Intermediary undertakes to treat
the Trustee as entitled to exercise the rights that comprise such
financial assets; and (ii) the "Principal Funding Cash Subaccount" to
which money or instruments deposited in the Reserve Account shall be
credited.
(ii) At the written direction of the Servicer, funds on
deposit in the Principal Funding Account shall be invested by the Trustee
or its nominee (including the Securities Intermediary) in Eligible
Investments selected by the Servicer. All such Eligible Investments shall
be held by the Trustee for the benefit of the Series 1998-1
Certificateholders; provided that on each Distribution Date all interest
and other investment income (net of losses and investment expenses )
("Principal Funding Investment Proceeds") on funds on deposit therein
shall be applied as set forth in paragraph (iii) below. All such Eligible
Investments will be held by the Trustee or its nominee (including the
Securities Intermediary) and will be carried in a Primary Funding
Investment Subaccount maintained by the Trustee with the Securities
Intermediary. Funds on deposit in the Principal Funding Account shall be
invested in Eligible Investments that will mature so that such funds will
be available at the close of business on the Transfer Date preceding the
following Distribution Date. No Eligible Investment shall be disposed of
prior to its maturity; provided, however, that the Trustee may sell,
liquidate or dispose of an Eligible Investment before its maturity, if so
directed in writing
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by the Servicer, the Servicer having reasonably determined that the
interest of the Series 1998-1 Certificateholders may be adversely affected
if such Eligible Investment is held to its maturity. Unless the Servicer
directs otherwise, funds deposited in the Principal Funding Account on a
Transfer Date (which immediately precedes a Distribution Date) upon the
maturity of any Eligible Investments are not required to be invested
overnight.
(iii) On each Distribution Date, the Servicer shall direct the
Trustee to withdraw from the Principal Funding Account and deposit into
the Collection Account all Principal Funding Investment Proceeds then on
deposit in the Principal Funding Account, and such Principal Funding
Investment Proceeds shall be treated as a portion of Class A Available
Funds for such Distribution Date.
(iv) Reinvested interest and other investment income on funds
deposited in the Principal Funding Account shall not be considered to be
principal amounts on deposit therein for purposes of this Supplement.
(b) (i) The Trustee shall possess all right, title and interest in
all funds and other property credited to the Principal Funding Account
from time to time and in all proceeds thereof. The Principal Funding
Account (including the subaccounts therein) shall be under the sole
dominion and control of the Trustee for the benefit of the Series 1998-1
Certificateholders. If, at any time, the Principal Funding Account ceases
to be a Qualified Account, the Trustee shall within 10 Business Days (or
such longer period, not to exceed 30 calendar days, as to which each
Rating Agency may consent) establish a new Principal Funding Account
meeting the conditions specified in paragraph (a) (i) above as a Qualified
Account and shall transfer any cash and/or any investments to such new
Principal Funding Account. The Securities Intermediary (including The Bank
of New York as initial Securities Intermediary) hereby represents that it
is as of the date hereof and shall be for so long as it is the Securities
Intermediary hereunder a corporation or national bank that (i) in the
ordinary course of its business maintains securities accounts for others
and is a acting in that capacity hereunder and (ii) maintains a
Participant's Securities Account (as defined in the United States
Regulations) with a Federal Reserve Bank. The Securities Intermediary
hereby agrees with the parties hereto that (x) the Principal Funding
Investment Subaccount is a securities account to the which financial
assets may be credited, (y) the Trustee shall be entitled to exercise
rights that comprise such financial assets and to exercise the ordinary
rights of an entitlement holder, (z) the "securities intermediary's
jurisdiction" as defined in the UCC of the Securities Intermediary with
respect to the Eligible Investments credited to the Principal Funding
Investment Subaccount, shall be the State of New York. The Securities
Intermediary represents and covenants that it is not and will not be (as
long as it is the Securities Intermediary hereunder) a party to any
agreement that is inconsistent with the provisions of this Agreement. The
Securities Intermediary covenants that is will not take any action
inconsistent with the provisions of this Agreement applicable to it. It is
the intent of the Trustee, the Servicer and the Transferor that the
Principal Funding Investment Subaccount shall be a securities account of
the Trustee and not an account of the Transferor or the Servicer. If
despite such intent, the Principal Funding Investment Subaccount is
determined to be an account of the Transferor or the Servicer, then the
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Securities Intermediary agrees to comply with entitlement orders
originated by the Trustee without further consent by the Transferor or the
Servicer.
(ii) Pursuant to the authority granted to the Servicer in
subsection 3.01(b) of the Agreement, the Servicer shall have the power,
revocable by the Trustee, to make withdrawals and payments or to instruct
the Trustee to make withdrawals and payments from the Principal Funding
Account for the purposes of carrying out the Servicer's or Trustee's
duties hereunder. Pursuant to the authority granted to the Paying Agent in
Section 5.1 of this Supplement and Section 6.07 of the Agreement, the
Paying Agent shall have the power, revocable by the Trustee, to withdraw
funds from the Principal Funding Account for the purpose of making
distributions to the Series 1998-1 Certificateholders.
Section 4.12. Class A Accumulation Period. The Class A Accumulation
Period is scheduled to commence on the Controlled Accumulation Date; provided,
however, that if the Class A Accumulation Period Length on any Determination
Date (determined as described below) is less than twelve months, upon notice to
the Trustee, the Transferor and each Rating Agency, the Servicer, at its option,
may elect to modify the date on which the Class A Accumulation Period actually
commences to the first day of the month that is a number of months prior to the
month in which the Class A Expected Final Distribution Date occurs at least
equal to the Class A Accumulation Period Length (so that, as a result, the
number of Monthly Periods in the Class A Accumulation Period will at least equal
the Class A Accumulation Period Length); provided, however, that (i) the length
of the Class A Accumulation Period will not be less than one month; and (ii)
notwithstanding any other provision of this Supplement to the contrary, no
election to postpone the commencement of the Class A Accumulation Period shall
be made after a Pay Out Event (as defined in the related Supplement) shall have
occurred and be continuing with respect to any other Series. On each
Determination Date, the Servicer will determine the "Class A Accumulation Period
Length," which will mean a number of months such that the amount available for
distribution of principal on the Class A Certificates on the Class A Expected
Final Distribution Date will equal or exceed the Class A Investor Amount,
assuming for this purpose that (1) the payment rate with respect to Collections
of Principal Receivables remains constant at the lowest level of such payment
rate during the twelve preceding Monthly Periods (or such lower payment rate as
the 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) and the Discount Percentage remains constant at the level on such date of
determination, (3) no Pay Out 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 the Servicer
electing to modify the commencement of the Class A Accumulation Period pursuant
to this Section 4.12 shall specify (i) the Class A Accumulation Period Length,
(ii) the commencement date of the Class A Accumulation Period and (iii) the
Controlled Accumulation Amount with respect to each Monthly Period during the
Class A Accumulation Period.
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Section 4.13. Reserve Account.
(a) The Servicer shall establish and maintain, in the name of the
Trustee, on behalf of the Trust, for the benefit of the Series 1998-1 Holders, a
Qualified Account (the "Reserve Account") with the Securities Intermediary
bearing a designation clearly indicating that the funds credited thereto are
held for the benefit of the Series 1998-1 Holders. The Reserve Account shall
consist of two segregated subaccounts: (i) the "Reserve Account Investment
Account" to which financial assets credited to the Reserve Account shall be
credited, and as to which financial assets the Securities Intermediary
undertakes to treat the Trustee as entitled to exercise the rights that comprise
such financial assets; and (ii) the "Reserve Account Cash Subaccount" to which
money or instruments deposited in the Reserve Account shall be credited. The
Reserve Account shall initially be established with The Bank of New York. The
Trustee shall possess all right, title and interest in all funds and other
property from time to time in the Reserve Account (including any subaccounts
therein) and in all proceeds thereof. The Reserve Account shall be under the
sole dominion and control of the Trustee for the benefit of the Series 1998-1
Holders. If at any time the Reserve Account ceases to be a Qualified Account,
the Trustee (or the Servicer on its behalf) shall within 10 Business Days (or
such longer period, not to exceed 30 calendar days, as to which each Rating
Agency may consent) establish a new Reserve Account meeting the conditions
specified above as a Qualified Account, and shall transfer any cash and/or any
investments to such new Reserve Account. The Trustee, at the direction of the
Servicer, shall (i) make withdrawals from the Reserve Account from time to time
for the purposes set forth in this Supplement, and (ii) on each Distribution
Date (from and after the Reserve Account Funding Date) prior to the termination
of the Reserve Account credit to the Reserve Account in the amount specified in,
and otherwise in accordance with, subsection 4.7(j).
(b) Funds on deposit in the Reserve Account shall be invested at the
written direction of the Servicer by the Trustee in Eligible Investments. All
such Eligible Investments will be held by the Trustee or its nominee (which may
be the Securities Intermediary) and will be credited to the Reserve Account
Investment Subaccount maintained by the Trustee with the Securities
Intermediary. 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 immediately succeeding
Transfer Date. The Trustee (or its nominee) shall maintain for the benefit of
the Series 1998-1 Holders possession of the instruments or securities, if any,
evidencing such Eligible Investments. No Eligible Investment shall be disposed
of prior to its maturity; provided, however, that the Trustee may sell,
liquidate or dispose of an Eligible Investment before its maturity, if so
directed by the Servicer in writing, the Servicer having reasonably determined
that the interest of the Series 1998-1 Holders may be adversely affected if such
Eligible Investment is held to its maturity. On each Distribution Date, all
interest and earnings (net of losses and investment expenses) accrued since the
preceding Distribution Date on funds on deposit in the Reserve Account shall be
retained in the Reserve Account (to the extent that the amount on deposit in the
Reserve Account is less than the Required Reserve Account Amount) and the
balance, if any, shall be deposited in the Collection Account and treated as
Collections of Finance Charge Receivables allocable to Series 1998-1. For
purposes of determining the availability of funds or the balance in the Reserve
Account for any reason
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under this 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 the Determination Date preceding each Distribution Date with
respect to the Controlled Accumulation Period (prior to the Class B Expected
Final Distribution Date) and the first Special Payment Date, the Servicer shall
calculate the "Reserve Draw Amount" which shall be equal to the excess, if any,
of the Covered Amount with respect to such Distribution Date or Special Payment
Date over the Principal Funding Investment Proceeds with respect to such
Distribution Date or Special Payment Date; provided, that such amount will be
reduced to the extent that funds otherwise would be available for deposit in the
Reserve Account under subsection 4.7(j) with respect to such Distribution Date.
(d) In the event that for any Distribution Date the Reserve Draw
Amount is greater than zero, the Reserve Draw Amount, up to the amount on
deposit in the Reserve Account, shall be withdrawn from the Reserve Account on
the related Transfer Date by the Trustee (acting in accordance with the
instructions of the Servicer), deposited into the Collection Account and
included in Class A Available Funds for such Distribution Date.
(e) In the event that the Reserve Account Surplus on any
Distribution Date, after giving effect to all credits to and withdrawals from
the Reserve Account with respect to such Distribution Date, is greater than
zero, the Trustee, acting in accordance with the instructions of the Servicer,
shall withdraw from the Reserve Account, and pay to the Holders of the
Transferor Certificates or their designee an amount equal to such Reserve
Account Surplus.
(f) Upon the earliest to occur of (i) the termination of the Trust
pursuant to Article XII of the Agreement, (ii) the day on which the Class A
Investor Amount is paid in full to the Class A Certificateholders, (iii) if the
Controlled Accumulation Period has not commenced, the occurrence of a Pay Out
Event with respect to Series 1998-1 and (iv) if the Controlled Accumulation
Period has commenced, the earlier of the first Special Payment Date and the
Class A Expected Final Distribution Date, the Trustee, acting in accordance with
the written instructions of the Servicer, after the prior payment of all amounts
owing to the Series 1998-1 Certificateholders which are payable from the Reserve
Account as provided herein, shall withdraw from the Reserve Account and pay to
the Holders of the Transferor Certificates or their designee all amounts, if
any, on deposit in the Reserve Account and the Reserve Account shall be deemed
to have terminated for purposes of this Supplement.
The Securities Intermediary (including The Bank of New York as
initial Securities Intermediary) hereby represents that it is as of the date
hereof and shall be for so long as it is the Securities Intermediary hereunder a
corporation or national bank that (i) in the ordinary course of its business
maintains securities accounts for others and is acting in that capacity
hereunder and (ii) maintains a Participant's Securities Account (as defined in
the United States Regulations) with a Federal Reserve Bank. The Securities
Intermediary hereby agrees with the parties hereto that (x) the Reserve Account
Investment Subaccount is a securities account to which financial assets may be
credited, (y) the Trustee shall be entitled to exercise rights that comprise
such financial assets and to exercise the ordinary rights of an entitlement
holder, (z) the "securities intermediary's jurisdiction" as defined in the UCC
of the Securities
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Intermediary with respect to the Eligible Investments credited to the Reserve
Account Investment Subaccount, shall be the State of New York. The Securities
Intermediary represents and covenants that it is not and will not be (as long as
it is the Securities Intermediary hereunder) a party to any agreement that is
inconsistent with the provisions of this Agreement. The Securities Intermediary
covenants that is will not take any action inconsistent with the provisions of
this Agreement applicable to it. It is the intent of the Trustee, the Servicer
and the Transferor that the Reserve Account Investment Subaccount shall be a
securities account of the Trustee and not an account of the Transferor or the
Servicer. If despite such intent, the Reserve Account Investment Subaccount is
determined to be an account of the Transferor or the Servicer, then the
Securities Intermediary agrees to comply with entitlement orders originated by
the Trustee without further consent by the Transferor or the Servicer.
Section 4.14. Designation of Class B Certificates Terms; Sale of
Class B Certificates. The Transferor may at any time, without the consent of the
Investor Certificateholders, (i) sell or transfer all or a portion of the Class
B Certificates and (ii) in connection with any such sale or transfer, enter into
a supplemental agreement with the Trustee pursuant to which the Transferor and
the Trustee may amend the Class B Certificate Rate, set forth the calculation of
the Class B Monthly Interest and Class B Additional Interest, if any, and
provide for such other provisions with respect to the Class B Certificates as
may be specified in such supplemental agreement; provided that in each case (A)
the Transferor shall have given notice to the Trustee, the Servicer and the
Rating Agencies of such proposed sale or transfer of the Class B Certificates
and such supplemental agreement at least five Business Days prior to the
consummation of such sale or transfer and the execution of such proposed
supplemental agreement; (B) the Rating Agency Condition shall have been
satisfied; (C) no Pay Out Event shall have occurred prior to the consummation of
such proposed sale or transfer of Class B Certificates or the execution of such
supplemental agreement; (D) the Transferor shall have delivered an Officer's
Certificate, dated the date of the consummation of such sale or transfer and the
effectiveness of such supplemental agreement, to the effect that, in the
reasonable belief of the Transferor, such action will not, based on the facts
known to such officer at the time of such certification, cause a Pay Out Event
to occur with respect to any Series; and (E) the Transferor will have delivered
a Tax Opinion, dated the date of such certificate with respect to such action;
provided further, (i) as a condition to the sale or transfer of all or a portion
of the Class B Certificates, the transferee shall be required to agree not to
institute against, or join any other Person in instituting against, the Trust or
the Transferor any bankruptcy, reorganization, arrangement, insolvency or
liquidation proceeding, or other proceeding under any federal or state
bankruptcy or similar law, for one year and one day after all Investor
Certificates are paid in full and (ii) the Class B Certificates may not be sold
or transferred, in whole or in part, to Travelers Bank & Trust, fsb or The
Travelers Bank USA.
Section 4.15. Designation of Class C Interests Terms; Sale of Class
C Interests. The Transferor may at any time, without the consent of the Investor
Certificateholders, (i) sell or transfer all or a portion of the Class C
Interests and (ii) in connection with any such sale or transfer, enter into a
supplemental agreement with the Trustee pursuant to which the Transferor and the
Trustee may amend the Class C Interest Rate, set forth the calculation of the
Class C Monthly Interest, provide for the payment of additional amounts with
respect to the Class C Interests as may be specified in such supplemental
agreement; provided, that in each case (A) the
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Transferor shall have given notice to the Trustee, the Servicer and the Rating
Agencies of such proposed sale or transfer of the Class C Interests and such
supplemental agreement at least five Business Days prior to the consummation of
such sale or transfer and the execution of such proposed supplemental agreement;
(B) the Rating Agency Condition shall have been satisfied; (C) no Pay Out Event
shall have occurred prior to the consummation of such proposed sale or transfer
of Class C Interests or the execution of such supplemental agreement; (D) the
Transferor shall have delivered an Officer's Certificate, dated the date of the
consummation of such sale or transfer and the effectiveness of such supplemental
agreement, to the effect that, in the reasonable belief of the Transferor, such
action will not, based on the facts known to such officer at the time of such
certification, cause a Pay Out Event to occur with respect to any Series; and
(E) the Transferor will have delivered a Tax Opinion, dated the date of such
certificate with respect to such action; provided further, (i) as a condition to
the sale or transfer of all or a portion of the Class C Interests the transferee
shall be required to agree not to institute against, or join any other Person in
instituting against, the Trust or the Transferor any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceeding, or other proceeding under any
federal or state bankruptcy or similar law, for one year and one day after all
Investor Certificates are paid in full and (ii) the Class C Interests may not be
sold or transferred, in whole or in part, to Travelers Bank & Trust, fsb or The
Travelers Bank USA.
ARTICLE V
Distributions and Reports to Series 1998-1 Certificateholders
Section 5.1. Distributions.
(a) On each Distribution Date, the Paying Agent shall distribute to
each Class A Certificateholder of record on the related Record Date (other than
as provided in Section 12.02 of the Agreement) such Class A Certificateholder's
pro rata share of the amounts that are allocated and available on such
Distribution Date to pay interest on the Class A Certificates pursuant to this
Supplement.
(b) On each Distribution Date, commencing with the first to occur of
the Class A Expected Final Payment Date and the first Special Payment Date, the
Paying Agent shall distribute to each Class A Certificateholder of record on the
related Record Date (other than as provided in Section 12.02 of the Agreement)
such Class A Certificateholder's pro rata share of the amounts that are
allocated and available on such date to pay principal of the Class A
Certificates pursuant to this Supplement up to a maximum amount on any such date
equal to the Class A Investor Amount on such date (unless there has been an
optional repurchase of the Certificateholders' Interest pursuant to Section
10.01 of the Agreement, in which event the foregoing limitation will not apply).
(c) On each Distribution Date, the Paying Agent shall distribute to
each Class B Certificateholder of record on the related Record Date (other than
as provided in Section 12.02 of the Agreement) such Class B Certificateholder's
pro rata share of the amounts that are
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allocated and available on such Distribution Date to pay interest on the Class B
Certificates pursuant to this Supplement.
(d) On each Distribution Date, commencing with the Class B Principal
Commencement Date, the Paying Agent shall distribute to each Class B
Certificateholder of record on the related Record Date (other than as provided
in Section 12.02 of the Agreement) such Class B Certificateholder's pro rata
share of the amounts that are allocated and available on such date to pay
principal of the Class B Certificates pursuant to this Supplement up to a
maximum amount on any such date equal to the Class B Investor Amount on such
date (unless there has been an optional repurchase of the Certificateholders'
Interest pursuant to Section 10.01 of the Agreement, in which event the
foregoing limitation will not apply).
(e) The distributions to be made pursuant to this Section 5.1 are
subject to the provisions of Sections 2.06, 9.02, 10.01 and 12.02 of the
Agreement and Sections 8.1 and 8.2 of this Supplement.
(f) Except as provided in Section 12.02 of the Agreement with
respect to a final distribution in respect of the Class A Certificates or the
Class B Certificates, distributions to Series 1998-1 Holders hereunder shall be
made by check mailed to each Series 1998-1 Holder at such Series 1998-1 Holder's
address appearing in the Certificate Register or the Book-Entry Register, as
applicable, without presentation or surrender of any Series 1998-1 Certificate
or the making of any notation thereon; provided, however, that with respect to
Series 1998-1 Certificates registered in the name of a Clearing Agency, such
distributions shall be made to such Clearing Agency in immediately available
funds.
Section 5.2. Certificates and Statements.
(a) Not later than each Determination Date, the Servicer shall
deliver to the Trustee, the Paying Agent and each Rating Agency, a certificate
substantially in the form of Exhibit B prepared by the Servicer.
(b) On each Distribution Date, the Paying Agent, on behalf of the
Trustee, shall forward to each Series 1998-1 Holder a statement substantially in
the form of Exhibit B prepared by the Servicer.
(c) A copy of each statement or certificate provided pursuant to
paragraph (a) or (b) may be obtained by any Series 1998-1 Holder or any
Certificate Owner thereof by a request in writing to the Servicer.
(d) On or before January 31 of each calendar year, beginning with
calendar year 1999, the Paying Agent, on behalf of the Trustee, shall furnish or
cause to be furnished to each Person who at any time during the preceding
calendar year was a Series 1998-1 Holder, a statement prepared by the Servicer
containing the information which is required to be contained in the statement to
Series 1998-1 Holders, as set forth in paragraph (b) above, aggregated for such
calendar year or the applicable portion thereof during which such Person was a
Series 1998-1 Holder, together with other information as is required to be
provided by an issuer of
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indebtedness under the Internal Revenue Code. Such obligation of the Servicer
shall be deemed to have been satisfied to the extent that substantially
comparable information shall be provided by the Paying Agent pursuant to any
requirements of the Internal Revenue Code as from time to time in effect.
ARTICLE VI
Additional Pay Out Events
Section 6.1. Additional Pay Out Events. If any one of the following
events (each, a "Series Pay Out Event") shall occur with respect to Series
1998-1:
(a) failure on the part of the Transferor (A) to make any payment or
deposit required by the terms of the Agreement on or before the date occurring
five Business Days after the date such payment or deposit is required to be made
herein or (B) duly to observe or perform in any material respect any other
covenants or agreements of the Transferor set forth in the Agreement which has a
material adverse effect on the Series 1998-1 Certificateholders (which
determination shall be made, for so long as the Class C Invested Amount is
greater than zero, without reference to whether any funds are available pursuant
to Series Enhancement) and continues unremedied for a period of 60 days after
the date on which written notice of such failure, requiring the same to be
remedied, shall have been given to the Transferor by the Trustee, or to the
Transferor and the Trustee by Series 1998-1 Certificateholders aggregating not
less than 50% of the sum of the outstanding principal balance of the Series
1998-1 Certificates;
(b) any representation or warranty made by the Transferor in the
Agreement or any information contained in a computer file or microfiche list
required to be delivered by the Servicer on behalf of the Transferor pursuant to
Section 2.01 or 2.09 of the Agreement (A) 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 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 Trustee, or to the Transferor and the
Trustee by Series 1998-1 Certificateholders aggregating not less than 50% of the
sum of the outstanding principal balance of the Series 1998-1 Certificates and
(B) as a result of which the interests of the Series 1998-1 Certificateholders
are materially and adversely affected (which determination shall be made, for so
long as the Class C Invested Amount is greater than zero, without reference to
whether any funds are available pursuant to any Series Enhancement); provided,
however, that a Series Pay Out Event pursuant to this subparagraph (b) shall not
be deemed to occur hereunder if the Transferor shall have accepted reassignment
of the related Receivable, or all of such Receivables, if applicable, during
such period (or such longer period as the Trustee may specify not to exceed 150
days) in accordance with the provisions hereof and of the Agreement;
(c) (1) with respect to the last day of any prior Monthly Period
during which the Transferor Amount is less than the Required Transferor Amount,
the failure of the Transferor to convey on or prior to the Required Designation
Date Receivables in Additional Accounts to the Trust such that the Transferor
Amount shall be at least equal to the Required Transferor
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Amount as of the close of business on the applicable Addition Date; or (2) with
respect to the last day of any prior Monthly Period during which the product of
(x) the aggregate amount of Principal Receivables and (y) one minus the Discount
Percentage is less than the Required Principal Balance as of such day, the
failure of the Transferor to convey on or prior to the Required Designation Date
Receivables in Additional Accounts to the Trust such that the product of (x) the
aggregate amount of the Principal Receivables and (y) one minus the Discount
Percentage shall be at least equal to the Required Principal Balance as of the
close of business on the applicable Addition Date;
(d) the Net Portfolio Yield averaged over three consecutive Monthly
Periods is less than the Base Rate averaged over such period;
(e) any Servicer Default shall occur which would have a material
adverse effect on the Series 1998-1 Certificateholders (which determination
shall be made, for so long as the Class C Invested Amount is greater than zero,
without reference to whether any funds are available pursuant to any Series
Enhancement); or
(f) the Class A Investor Amount shall not be paid in full on the
Class A Expected Final Distribution Date or the Class B Invested Amount shall
not be paid in full on the Class B Expected Final Distribution Date;
then, in the case of any event described in subparagraph (a), (b) or (e), after
the applicable grace period, if any, set forth in such subparagraphs, either the
Trustee or the Series 1998-1 Holders evidencing more than 50% of the aggregate
unpaid principal amount of the Series 1998-1 Certificates and the Class C
Interests by notice then given in writing to the Transferor and the Servicer
(and to the Trustee if given by the Series 1998-1 Holders) may declare that a
Pay Out Event has occurred with respect to Series 1998-1 as of the date of such
notice, and, in the case of any event described in subparagraph (c), (d) or (f)
a Pay Out Event shall occur with respect to Series 1998-1 without any notice or
other action on the part of the Trustee or the Series 1998-1 Holders immediately
upon the occurrence of such event.
ARTICLE VII
Optional Repurchase; Series Termination
Section 7.1. Optional Repurchase. Subject to Section 12.5 of the
Agreement, on any day occurring on or after the date on which the Investor
Amount is reduced to 10% or less of the Initial Investor Amount, the Transferor
shall have the option to purchase the interest of the Series 1998-1 Holders 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.
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Section 7.2. Series Termination.
(a) If, on the November 2004 Distribution Date, the Investor Amount
(after giving effect to all changes therein on such date) would be greater than
zero, the Servicer, on behalf of the Trustee, shall, within the 40-day period
which begins on such Distribution Date, solicit bids for the sale of Principal
Receivables and the related Finance Charge Receivables (or interests therein) in
an amount equal to the Investor Amount and accrued and unpaid interest thereon
at the close of business on the last day of the Monthly Period preceding the
Series Termination Date (after giving effect to all distributions required to be
made on the Series Termination Date, except pursuant to this Section 7.2;
provided, however, that in no event shall such amount exceed the Series
Percentage of Receivables on the Series Termination Date). Such bids shall
require that such sale shall (subject to subsection 7.2(b)) occur on the Series
Termination Date. The Transferor shall be entitled to participate in, and to
receive from the Trustee a copy of each other bid submitted in connection with,
such bidding process.
(b) The Servicer, on behalf of the Trustee, shall sell such
Receivables (or interests therein) on the Series Termination Date to the bidder
who made the highest cash purchase offer. The proceeds of any such sale shall be
treated as Collections on the Receivables allocated to Series 1998-1 pursuant to
the Agreement and this Supplement, provided, however, however, that the Servicer
shall determine conclusively the amount of such proceeds which are allocable to
Finance Charge Receivables and the amount of such proceeds which are allocable
to Principal Receivables. During the period from the November 2004 Distribution
Date to the Series Termination Date, the Servicer shall continue to collect
payments on the Receivables and allocate and deposit such collections in
accordance with the provisions of the Agreement and the Supplements.
ARTICLE VIII
Final Distributions
Section 8.1. Sale of Receivables or Certificateholders' Interest
Pursuant to Section 2.06 or 10.01 of the Agreement.
(a) Purchase Price. The amount to be paid with respect to Series
1998-1 in connection with (i) a reassignment of Receivables to the Transferor
pursuant to Section 2.06 of the Agreement or (ii) a repurchase of the
Certificateholders' Interest pursuant to Section 10.01 of the Agreement shall
equal the Reassignment Amount for the first Distribution Date following the
Monthly Period in which the reassignment obligation arises under the Agreement.
(b) Distributions Pursuant to Section 7.01 or 7.02 of this
Supplement and Section 10.01 of the Agreement. With respect to the Reassignment
Amount deposited into the Collection Account pursuant to Section 7.1 or
8.1(a)(ii) or any amounts allocable to Series 1998-1 deposited into the
Collection Account pursuant to Section 7.2, the Trustee shall, not later than
3:00 p.m. New York City time, on the related Distribution Date, make deposits or
distributions of the following amounts (in the priority set forth below and, in
each case, after
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giving effect to any deposits and distributions otherwise to be made on such
date) in immediately available funds: (i) (x) the Class A Investor Amount on
such Distribution Date will be distributed to the Paying Agent for payment to
the Class A Certificateholders and (y) an amount equal to the sum of (A) Class A
Monthly Interest for such Distribution Date, (B) any Class A Monthly Interest
previously due but not distributed to the Class A Certificateholders on a prior
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 Certificateholders on any prior Distribution
Date, will be distributed to the Paying Agent for payment to the Class A
Certificateholders, (ii) (x) the Class B Invested Amount on such Distribution
Date will be distributed to the Paying Agent for payment to the Class B
Certificateholders and (y) an amount equal to the sum of (A) Class B Monthly
Interest for such Distribution Date, (B) any Class B Monthly Interest previously
due but not distributed to the Class B Certificateholders on a prior
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 Certificateholders on any prior Distribution
Date, will be distributed to the Paying Agent for payment to the Class B
Certificateholders and (iii) (x) the Class C Invested Amount on such
Distribution Date will be distributed to the Class C Interest Holder and (y) an
amount equal to the sum of (A) Class C Monthly Interest, if any, for such
Distribution Date and (B) any Class C Monthly Interest previously due but not
distributed to the Class C Interest Holders on a prior Distribution Date shall
be distributed to the Class C Interest Holder.
(c) Distributions Pursuant to Section 2.06 of the Agreement. With
respect to any amounts deposited into the Collection Account pursuant to
subsection 8.1(a)(i), the Trustee shall, not later then 12:00 noon, New York
City time, on the related Distribution Date, deposit the principal portion of
such amounts that are allocable to the Series 1998-1 Holders into the
Collections Account.
(d) Notwithstanding anything to the contrary in this Supplement or
the Agreement, all amounts distributed to the Paying Agent pursuant to
subsection 8.1(b) for payment to the Series 1998-1 Certificateholders shall be
deemed distributed in full to the Series 1998-1 Certificateholders on the date
on which such funds are distributed to the paying Agent pursuant to this Section
and shall be deemed to be a final distribution pursuant to Section 12.02 of the
Agreement.
ARTICLE IX
Certificates
Section 9.1. Book-Entry Certificates. The Class A Certificates shall
be delivered as Book-Entry Certificates. The Clearing Agency for the Class A
Certificates shall be The Depository Trust Company, and the Class A Certificates
shall be initially registered in the name of Cede & Co., its nominee.
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Section 9.2. Uncertificated Securities. The Class B Certificates and
the Class C Interests shall be delivered in uncertificated form.
ARTICLE X
Miscellaneous Provisions
Section 10.1. Ratification of Agreement. As supplemented by this
Supplement, the Agreement is in all respects ratified and confirmed and the
Agreement as so supplemented by this Supplement shall be read, taken and
construed as one and the same instrument.
Section 10.2. Counterparts. This 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 10.3. Governing Law. THIS SUPPLEMENT 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; PROVIDED,
HOWEVER, THAT THE IMMUNITIES AND STANDARD OF CARE OF THE TRUSTEE IN THE
ADMINISTRATION OF THE TRUST HEREUNDER SHALL BE GOVERNED BY THE LAWS OF THE STATE
OF NEW YORK.
Section 10.4. Notices. All directions, notices and instructions to
the Trustee shall be in writing (which may be facsimile).
Section 10.5. Amendments. This Supplement may be amended by the
Transferor without the consent of the Servicer, the Trustee or any Investor
Certificateholder if the Transferor provides the Trustee with (i) an Opinion of
Counsel to the effect that such amendment or modification would reduce the risk
that the Trust would be treated as taxable as a publicly traded partnership
pursuant to Code section 7704 and (ii) an Officer's Certificate that such
amendment or modification would not materially and adversely affect any Investor
Certificateholder, provided that no such amendment shall be deemed effective
without (i) the Trustee's consent, if the Trustee's rights, duties and
obligations hereunder are thereby modified and (ii) the Trustee having obtained
written assurance that such amendment or modification will not, by itself, lower
the then-current ratings on the Series 1998-1 Certificates. The Transferor shall
provide the Rating Agencies with prior written notice of any such amendment or
modification.
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IN WITNESS WHEREOF, the undersigned have caused this Supplement to
be duly executed and delivered by their respective duly authorized officers on
the day and year first above written.
CC CREDIT CARD CORPORATION
Transferor,
By: /s/ Barbara Yastine
-----------------------------
Name: Barbara Yastine
Title: President
TRAVELERS BANK & TRUST, fsb
Servicer,
By: /s/ Charles Haug
----------------------------
Name: Charles Haug
Title: SVP & CFO
THE BANK OF NEW YORK,
Trustee and Securities Intermediary
By: /s/ Wuhan Dansby
--------------------------------
Name: Wuhan Dansby
Title: Assistant Vice President
[Signature Page for Series 1998-1 Supplement]
Exhibit 10.1
EXECUTION COPY
- --------------------------------------------------------------------------------
CC CREDIT CARD CORPORATION,
as Corporation
and
TRAVELERS BANK & TRUST, fsb,
as Account Owner
RECEIVABLES TRANSFER AGREEMENT
Dated as of March 1, 1998
- --------------------------------------------------------------------------------
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TABLE OF CONTENTS
Page
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ARTICLE I
DEFINITIONS
Section 1.01. Definitions.................................................. 1
Section 1.02. Other Definitional Provisions................................ 4
ARTICLE II
PURCHASE AND CONVEYANCE OF RECEIVABLES
Section 2.01. Purchase..................................................... 4
Section 2.02. Addition of Additional Accounts.............................. 6
Section 2.03. Representations and Warranties............................... 7
Section 2.04. Delivery of Documents........................................ 7
ARTICLE III
CONSIDERATION AND PAYMENT
Section 3.01. Purchase Price............................................... 8
Section 3.02. Adjustments to Purchase Price................................ 8
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01. Representations and Warranties of the Account Owner
Relating to the Account Owner................................ 9
Section 4.02. Representations and Warranties of the Account Owner
Relating to the Agreement and the Receivables................ 10
Section 4.03. Representations and Warranties of the Corporation............ 12
ARTICLE V
COVENANTS
Section 5.01. Covenants of the Account Owner............................... 13
Section 5.02. Covenants of the Account Owner with Respect to Portfolio
Yield and Cardholder Agreements.............................. 15
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Page
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ARTICLE VI
REPURCHASE OBLIGATION
Section 6.01. Reassignment of Ineligible Receivables....................... 16
Section 6.02. Reassignment of Receivables in Trust Portfolio............... 16
ARTICLE VII
CONDITIONS PRECEDENT
Section 7.01. Conditions to the Corporation's Obligations Regarding
Initial Receivables.......................................... 17
Section 7.02. Conditions Precedent to the Account Owner's Obligations...... 18
TERM AND PURCHASE TERMINATION
Section 8.01. Term......................................................... 18
Section 8.02. Purchase Termination......................................... 18
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.01. Amendment.................................................... 19
Section 9.02. Governing Law................................................ 19
Section 9.03. Notices...................................................... 19
Section 9.04. Severability of Provisions................................... 20
Section 9.05. Assignment................................................... 20
Section 9.06. Acknowledgement and Agreement of the Account Owner........... 20
Section 9.07. Further Assurances........................................... 20
Section 9.08. No Waiver; Cumulative Remedies............................... 21
Section 9.09. Counterparts................................................. 21
Section 9.10. Binding; Third-Party Beneficiaries........................... 21
Section 9.11. Merger and Integration....................................... 21
Section 9.12. Headings..................................................... 21
Section 9.13. Schedules and Exhibits....................................... 21
Section 9.14. Survival of Representations and Warranties................... 21
Section 9.15. Nonpetition Covenant......................................... 22
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RECEIVABLES TRANSFER AGREEMENT, dated as of March 1, 1998, by and
between TRAVELERS BANK & TRUST, fsb, a federally chartered savings bank (the
"Account Owner"), and CC CREDIT CARD CORPORATION, a Delaware corporation (the
"Corporation").
W I T N E S S E T H:
WHEREAS, the Corporation desires to purchase, from time to time,
certain Receivables (hereinafter defined) arising in certain credit card
accounts of the Account Owner;
WHEREAS, the Account Owner desires to sell from time to time and
assign certain Receivables to the Account Owner upon the terms and conditions
hereinafter set forth;
WHEREAS, it is contemplated that the Receivables purchased hereunder
will be transferred by the Corporation to the Trust (hereinafter defined) in
connection with the issuance of certain Certificates (hereinafter defined); and
WHEREAS, the Account Owner agrees that all covenants and agreements
made by the Account Owner herein with respect to the Accounts (hereinafter
defined) and Receivables shall also be for the benefit of the Trustee
(hereinafter defined) and all beneficiaries of the Trust, including the holders
of the Certificates.
NOW, THEREFORE, it is hereby agreed by and between the Account Owner
and the Corporation as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. All capitalized terms used herein or in
any certificate, document, or Conveyance Paper made or delivered pursuant
hereto, and not defined herein or therein, shall have the meaning ascribed
thereto in the Pooling and Servicing Agreement; in addition, the following words
and phrases shall have the following meanings:
"Account" shall mean each Initial Account and each Additional
Account (but only from and after the Addition Date with respect thereto) but
shall exclude any Account in which all the Receivables are either reassigned or
assigned to the Corporation or its designee or to the Servicer in accordance
with the terms of the Pooling and Servicing Agreement and shall exclude any
Account all the Receivables in which are, after the Removal Date, not to be
assigned to the Corporation pursuant to subsection 2.01(e) hereof. The
definition of Account shall include each account into which an Account shall be
transferred (a
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"Transferred Account"), provided that (i) such transfer is made in
accordance with the Credit Card Guidelines and (ii) such Transferred Account can
be traced or identified as an account into which an Account has been
transferred.
"Account Owner" shall mean Travelers Bank & Trust, fsb, a federally
chartered savings bank.
"Additional Account" shall mean each consumer revolving credit card
account established pursuant to a Cardholder Agreement, which account is
designated by the Account Owner pursuant to Section 2.01 or 2.02 hereof to be
included as an Account and which is identified in a computer file or microfiche
list delivered to the Corporation or to the Trustee pursuant to subsection
2.01(c) or Section 2.04.
"Addition Cut-Off Date" shall mean with respect to any Additional
Accounts the date specified in the related Assignment.
"Addition Date" shall mean with respect to Additional Accounts, the
date on which the Receivables in such Additional Accounts are conveyed to the
Trust pursuant to Section 2.02.
"Addition Notice Date" shall have the meaning specified in Section
2.02 of this Agreement.
"Agreement" shall mean this Receivables Transfer Agreement and all
amendments hereof and supplements hereto.
"Conveyance" shall have the meaning specified in subsection 2.01(a).
"Conveyance Papers" shall have the meaning specified in subsection
4.01(c).
"Corporation" shall mean CC Credit Card Corporation, a Delaware
corporation, and its permitted successors and assigns.
"Credit Adjustment" shall have the meaning specified in Section
3.02.
"Debtor Relief Laws" shall mean (i) the Bankruptcy Code of the
United States of America and (ii) all other applicable liquidation,
conservatorship, bankruptcy, moratorium, rearrangement, receivership,
insolvency, reorganization, suspension of payments, readjustment of debt,
marshalling of assets or similar debtor relief laws of the United States, any
state or any foreign country from time to time in effect affecting the rights of
creditors generally.
"Finance Charge Receivables" shall mean all Receivables in the
Accounts which would be treated as "Finance Charge Receivables" in accordance
with the Pooling and Servicing Agreement.
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"Initial Account" shall mean each MasterCard(R) and VISA(R)1 account
established pursuant to a Cardholder Agreement between Travelers Bank & Trust,
fsb and any person, and identified by account number and by the Receivable
balance in a computer file or microfiche list delivered to the Trustee by the
Corporation on or prior to the Initial Closing Date pursuant to subsection
2.01(c).
"Initial Closing Date" shall mean March 6, 1998.
"Initial Cut-Off Date" shall mean December 31, 1997.
"Insolvency Event" shall have the meaning specified in Section 8.02.
"New Principal Receivables" shall have the meaning set forth in
Section 3.01.
"Obligor" shall mean, with respect to each Account, each person that
would be treated as an "Obligor" in accordance with the definition for such term
in the Pooling and Servicing Agreement.
"Pooling and Servicing Agreement" shall mean the Pooling and
Servicing Agreement, dated as of March 1, 1998, among CC Credit Card
Corporation, as Transferor, Travelers Bank & Trust, fsb, in its individual
capacity and as Servicer, and the Trustee, together with all amendments and
supplements thereto.
"Portfolio Reassignment Price" shall mean that portion of the amount
payable by the Corporation to the Trustee pursuant to Section 2.06 of the
Pooling and Servicing Agreement which is allocable to the Receivables in
Accounts of the Account Owner hereunder.
"Principal Receivables" shall mean all Receivables in the Accounts
that would be treated as "Principal Receivables" in accordance with the
definition for such term in the Pooling and Servicing Agreement.
"Purchase Price" shall have the meaning set forth in Section 3.01.
"Purchased Assets" shall have the meaning set forth in Section 2.01.
"Receivables" shall mean all amounts shown on the Servicer's records
as amounts payable by Obligors on any Account with respect to which the Account
Owner hereunder is the Account Owner, from time to time, including amounts
payable for Principal Receivables and Finance Charge Receivables. Receivables
which become Defaulted Receivables will cease to be included as Receivables as
of the day on which they become Defaulted Receivables.
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1 MasterCard and VISA are registered trademarks of MasterCard International
Incorporated and of VISA USA, Inc., respectively.
3
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"Removed Account" shall mean an Account hereunder that is a "Removed
Account" (as such term is defined in the Pooling and Servicing Agreement) that
is designated for removal pursuant to Section 2.10 of the Pooling and Servicing
Agreement.
"Repurchase Price" shall have the meaning set forth in subsection
6.01(b) hereof.
"Supplemental Conveyance" shall have the meaning set forth in
Section 2.04.
"Trust" shall mean the Travelers Bank Credit Card Master Trust I
created by the Pooling and Servicing Agreement.
"Trustee" shall mean The Bank of New York, a New York banking
corporation, the institution executing the Pooling and Servicing Agreement as,
and acting in the capacity of Trustee thereunder, or its successor in interest,
or any successor trustee appointed as provided in the Pooling and Servicing
Agreement.
Section 1.02. Other Definitional Provisions.
(a) All terms defined in this Agreement shall have the defined
meanings when used in any certificate, other document, or Conveyance Paper made
or delivered pursuant hereto unless otherwise defined therein.
(b) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement or any Conveyance Paper shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement; and Section, subsection, Schedule and Exhibit references contained in
this Agreement are references to Sections, subsections, Schedules and Exhibits
in or to this Agreement, as such Sections, subsections, Schedules and Exhibits
may be amended, unless otherwise specified.
(c) All determinations of the principal or finance charge balance of
Receivables, and of any collections thereof, shall be made in accordance with
the Pooling and Servicing Agreement and all applicable Supplements.
ARTICLE II
PURCHASE AND CONVEYANCE OF RECEIVABLES
Section 2.01. Purchase.
(a) By execution of this Agreement, the Account Owner does hereby
sell, transfer, assign, set over and otherwise convey to the Corporation
(collectively, the "Conveyance"), without recourse except as provided herein,
all its right, title and interest in, to and under the Receivables existing at
the close of business on the Initial Cut-Off Date, in the case of Receivables
arising in the Initial Accounts, and the Receivables existing at the
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close of business on each Addition Cut-Off Date, in the case of Receivables
arising in the Additional Accounts, and, in each case, the Receivables
thereafter created from time to time until the termination of the Trust or until
such Account becomes a Removed Account, all monies due or to become due and all
amounts received with respect thereto (excluding, however, any and all
Recoveries) and all proceeds (including "proceeds" as defined in the UCC)
thereof (the "Purchased Assets").
(b) In connection with such Conveyance, the Account Owner agrees (i)
to record and file, at its own expense, any financing statements (and
continuation statements with respect to such financing statements when
applicable) with respect to the Receivables and other Purchased Assets 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 such Purchased Assets from the Account
Owner to the Corporation, (ii) that such financing statements shall name the
Account Owner, as seller, and the Corporation, as purchaser, of the Receivables
and other Purchased Assets and (iii) to deliver a file-stamped copy of such
financing statements or other evidence of such filings (excluding such
continuation statements, which shall be delivered as filed) to the Corporation
as soon as is practicable after filing.
(c) In connection with such Conveyance, the Account Owner further
agrees that it will, at its own expense, (i) on or prior to (x) the Initial
Closing Date, in the case of Initial Accounts, (y) the applicable Addition Date,
in the case of Additional Accounts and (z) the applicable Removal Date, in the
case of Removed Accounts, indicate in its computer files with the code "30" or
"31" or any other clearly specified code in the FDR Account Flagged field of
such computer files that, in the case of the Initial Accounts or the Additional
Accounts, Receivables created in connection with such Accounts have been
conveyed to the Corporation in accordance with this Agreement and have been
conveyed by the Corporation to the Trustee pursuant to the Pooling and Servicing
Agreement for the benefit of the Certificateholders by including (or deleting,
in the case of newly originated Receivables in Removed Accounts) in such
computer files the code identifying each such Account and (ii) deliver on or
before the Initial Closing Date, in the case of the Initial Accounts, or on or
before the Addition Date, in the case of the Additional Accounts, to the
Corporation or the Trustee, as the Corporation's nominee, a computer files or
microfiche file containing a true and complete list of all such Accounts
specifying for each such Account, as of the Initial Cut-Off Date, in the case of
Initial Accounts, the applicable Addition Cut-Off Date, in the case of
Additional Accounts, and the applicable Removal Cut-Off 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. Each such file or list, as supplemented from time to time to reflect
Additional Accounts or Removed Accounts, shall be marked as Schedule I to this
Agreement, shall be delivered to the Corporation or the Trustee, as the
Corporation's nominee, and is hereby incorporated into and made a part of this
Agreement. The Account Owner further agrees not to alter the code referenced in
clause (i) of this paragraph with respect to any Account during the term of this
Agreement unless and until such Account becomes a Removed Account or unless and
until (i) the Account Owner shall give written notice of any such alteration to
the Corporation and to the Trustee, such written notice to be as of the date of
its receipt by the Trustee incorporated
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into and part of this Agreement and (ii) the Account Owner and the Corporation
shall execute and file any UCC financing statement or amendment thereof
necessitated by such alteration.
(d) The parties hereto intend that the conveyance of the Account
Owner's right, title and interest in and to the Receivables and the other
Purchased Assets shall constitute an absolute sale, conveying good title free
and clear of any liens, claims, encumbrances or rights of others from the
Account Owner to the Corporation. It is the intention of the parties hereto that
the arrangements with respect to the Receivables and other Purchased Assets
shall constitute a purchase and sale of such Receivables and not a loan. In the
event, however, that it were to be determined that the transactions evidenced
hereby constitute a loan and not a purchase and sale, it is the intention of the
parties hereto that this Agreement shall constitute a security agreement under
applicable law, and that the Account Owner shall be deemed to have granted and
does hereby grant to the Corporation a first priority perfected security
interest, in all of the Account Owner's right, title and interest, whether now
owned or hereafter acquired, in, to and under the Receivables and other
Purchased Assets to secure the rights of the Corporation hereunder and the
obligations of the Account Owner hereunder.
(e) If any Account becomes a Removed Account as provided in Section
2.10 of the Pooling and Servicing Agreement, the Account Owner, upon being
notified of the removal of such Account shall cease to sell the Receivables
arising therein to the Corporation.
Section 2.02. Addition of Additional Accounts.
(a) If, from time to time, the Corporation becomes obligated to
designate Additional Accounts (as such term is defined in the Pooling and
Servicing Agreement) pursuant to subsection 2.09(a) of the Pooling and Servicing
Agreement, then the Corporation may, at its option, give the Account Owner
written notice thereof on or before the tenth Business Day (the "Addition Notice
Date") prior to the Addition Date therefor, and upon receipt of such notice the
Account Owner shall on or before the Addition Date, designate sufficient
Eligible Accounts to be included as Additional Accounts so that after the
inclusion thereof the Corporation will be in compliance with the requirements of
said subsection 2.09(a) of the Pooling and Servicing Agreement. Additionally,
subject to subsection 2.02(b) hereof, from time to time Eligible Accounts may be
designated to be included as Additional Accounts, upon the mutual agreement of
the Corporation and the Account Owner. In either event, the Account Owner shall
have sole responsibility for selecting the Additional Accounts and shall
determine and notify the Corporation of the Addition Cut-Off Date with respect
to such Additional Accounts.
(b) On the Addition Date with respect to any designation of
Additional Accounts, the Corporation shall purchase the Account Owner's right,
title and interest in, to and under the Receivables in Additional Accounts (as
of the Addition Cut-Off Date) (and such Additional Accounts shall be deemed to
be Accounts for purposes of this Agreement), subject to the satisfaction of the
following conditions:
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i) all Additional Accounts shall be Eligible Accounts;
ii) the Account Owner shall have delivered to the Corporation copies
of UCC financing statements covering such Additional Accounts, if
necessary to perfect the Corporation's ownership of the Receivables
arising therein;
iii) to the extent required of the Corporation by Section 4.03 of
the Pooling and Servicing Agreement, the Account Owner shall have
deposited in the Collection Account all Collections with respect to such
Additional Accounts since the Addition Cut-Off Date;
iv) as of each of the Addition Cut-Off Date and the Addition Date,
no Insolvency Event with respect to the Account Owner shall have occurred
nor shall the transfer to the Corporation of the Receivables arising in
the Additional Accounts have been made in contemplation of the occurrence
thereof; and
v) the Account Owner shall have delivered to the Corporation an
Officer's Certificate, dated the Addition Date, (a) stating that, as of
the applicable Addition Cut-Off Date, the Additional Accounts are all
Eligible Accounts (b) confirming, to the extent applicable, the items set
forth in clauses (ii) through (iv) above; and (c) stating that the Account
Owner reasonably believes that the addition to the Trust of the
Receivables arising in the Additional Accounts will not based on the facts
known to such officer at the time of such addition, then or thereafter
cause an Adverse Effect to occur.
Section 2.03. Representations and Warranties. The Account Owner
hereby represents and warrants to the Corporation as of the related Addition
Date that, in the case of the Initial Accounts, the computer file or microfiche
file delivered pursuant to Section 2.01(c) hereof and marked as Schedule I to
this Agreement delivered pursuant to Section 2.01(c) hereof and, in the case of
Additional Accounts, the list delivered pursuant to Section 2.04 below is, as of
the applicable Addition Cut-Off Date, true and complete in all material
respects.
Section 2.04. Delivery of Documents. In the case of the designation
of Additional Accounts, the Account Owner shall deliver to the Corporation or
the Trustee (i) the schedule to be delivered pursuant to Section 2.01 hereof
with respect to such Additional Accounts on the date such file or list is
required to be delivered pursuant to Section 2.01 (the "Document Delivery Date")
and (ii) with respect to Additional Accounts, a duly executed written assignment
(including an acceptance by the Corporation), substantially in the form of
Exhibit A (the "Supplemental Conveyance"), on the Addition Date.
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ARTICLE III
CONSIDERATION AND PAYMENT
Section 3.01. Purchase Price.
(a) The "Purchase Price" for the Receivables in the Initial Accounts
as of the Initial Cut-Off Date conveyed to the Corporation under this Agreement
shall be payable on the Initial Closing Date and shall be an amount equal to the
balance of the Receivables in the Initial Accounts as of the Initial Cut-Off
Date, adjusted to reflect such factors as the Account Owner and the Corporation
mutually agree will result in a Purchase Price determined to be not less than
the fair market value of such Receivables. This computation of initial purchase
price should assume no reinvestment in new Receivables. The Purchase Price for
the Receivables (including Receivables in Additional Accounts) to be conveyed to
the Corporation under this Agreement which come into existence after the Initial
Cut-Off Date, shall be payable on the Distribution Date following the Monthly
Period in which such Receivables are conveyed by the Account Owner to the
Corporation in an amount equal to the balance of the Principal Receivables so
conveyed (the "New Principal Receivables"), adjusted to reflect such factors as
the Account Owner and the Corporation mutually agree will result in a Purchase
Price determined to be not less than the fair market value of such New Principal
Receivables.
(b) The Purchase Price to be paid by the Corporation on the Initial
Closing Date and on each Distribution Date following a Monthly Period during
which New Principal Receivables are conveyed to the Corporation shall be paid in
cash.
Section 3.02. Adjustments to Purchase Price. The Purchase Price
shall be adjusted on each Distribution Date (a "Credit Adjustment") with respect
to any Receivable previously conveyed to the Corporation by the Account Owner
which has since been reversed by the Account Owner or the Servicer because of a
rebate, refund, unauthorized charge or billing error to an Obligor or because
such Receivable was created in respect of merchandise which was refused or
returned or due to the occurrence of any other event referred to in Section 3.09
of the Pooling and Servicing Agreement. The amount of such adjustment shall
equal (x) the reduction in the Principal Receivables resulting from the
occurrence of such event multiplied by (y) the quotient (expressed as a
percentage) of (i) the Purchase Price for Principal Receivables payable on such
Distribution Date computed in accordance with Section 3.01 hereof divided by
(ii) the Principal Receivables paid for on such date pursuant to such Section
3.01. In the event that an adjustment pursuant to this Section 3.02 causes the
Purchase Price to be a negative number, the Account Owner agrees that, not later
than 1:00 P.M. New York City time on such Distribution Date, the Account Owner
shall pay to the Corporation an amount equal to the amount by which the Purchase
Price minus the Credit Adjustment would be reduced below zero.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01. Representations and Warranties of the Account Owner
Relating to the Account Owner. The Account Owner hereby represents and warrants
to, and agrees with, the Corporation as of the Initial Closing Date and on each
Addition Date, that:
(a) Organization and Good Standing. The Account Owner is a federally
chartered savings bank duly organized and validly existing in good standing
under the laws of the United States and has, in all material respects, full
power and authority to own or lease its properties and conduct its business as
such properties are presently owned or leased and such business is presently
conducted, and to execute, deliver and perform its obligations under this
Agreement.
(b) Due Qualification. The Account Owner 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 (i) render any Cardholder Agreement relating to an Account, or
any Receivable unenforceable by the Account Owner, the Servicer or the Trustee
and (ii) have a material adverse effect on the interests of the
Certificateholders.
(c) Due Authorization. The execution, delivery and performance of
this Agreement and any other document or instrument delivered pursuant hereto,
including any Supplemental Conveyance (such other documents or instruments,
collectively, the "Conveyance Papers"), and the consummation of the transactions
provided for in this Agreement and the Conveyance Papers have been (i) duly
authorized by the Account Owner by all necessary corporate action on the part of
the Account Owner and (ii) each of this Agreement and the Conveyance papers will
remain, from the time of its execution, an official record of the Account Owner.
(d) No Conflict. The execution and delivery of this Agreement and
the Conveyance Papers by the Account Owner, 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 the Account
Owner will not conflict with or result in any breach of any of the material
terms and provisions of, or constitute (with or without notice or lapse of time
or both) a material default under, any indenture, contract, agreement, mortgage,
deed of trust, or other instrument to which the Account Owner is a party or by
which it or any of its properties are bound.
(e) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of the Account Owner, threatened against the
Account Owner, before any court, regulatory body, administrative agency, or
other tribunal or governmental instrumentality (i) asserting the invalidity of
this Agreement or the Conveyance Papers, (ii) seeking to prevent the
consummation of any of the transactions contemplated by this
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Agreement or the Conveyance Papers, (iii) seeking any determination or ruling
that, in the reasonable judgment of the Account Owner, would materially and
adversely affect the performance by the Account Owner of its obligations under
this Agreement or the Conveyance Papers, (iv) seeking any determination or
ruling that, in the reasonable judgment of the Account Owner, would materially
and adversely affect the validity or enforceability of this Agreement or the
Conveyance Papers or (v) seeking to affect adversely the income tax attributes
of the Trust or any Certificates under the United States Federal or any state
income or franchise tax systems.
(f) All Consents. All approvals, authorizations, consents, orders or
other actions of any Person or of any governmental body or official required to
be obtained, effected or given by the Account Owner in connection with the
execution and delivery by the Account Owner of this Agreement and the Conveyance
Papers and the performance of the transactions contemplated by this Agreement or
the Conveyance Papers by the Account Owner have been duly obtained, effected or
given and are in full force and effect, except for approvals, authorizations,
consents, orders or other actions which if not obtained will not individually or
in the aggregate have any material adverse effect upon the ability of the
Account Owner to execute, deliver and perform under this Agreement and the
Conveyance Papers.
(g) No Insolvency Event. No Insolvency Event with respect to the
Account Owner has occurred and the transfer of the Receivables and other
Purchased Assets by the Account Owner to the Corporation as contemplated by this
Agreement has not been made in contemplation thereof.
(h) No Violation. The execution, delivery and performance of this
Agreement and the Conveyance Papers by the Account Owner and the fulfillment of
the terms contemplated herein and therein applicable to the Account Owner will
not conflict with or violate any Requirements of Law applicable to the Account
Owner.
The representations and warranties set forth in this Section 4.01
shall survive the transfer and assignment of the Receivables to the Corporation
and the transfer and assignment by the Corporation to the Trust. Upon discovery
by the Account Owner, the Corporation or the Trustee of a breach of any of the
foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the others.
Section 4.02. Representations and Warranties of the Account Owner
Relating to the Agreement and the Receivables.
(a) Representations and Warranties. The Account Owner hereby
represents and warrants to the Corporation as of the date of this Agreement, as
of the Initial Closing Date and, with respect to Additional Accounts, as of the
related Addition Date that:
(i) this Agreement and, in the case of Additional Accounts, the
related Supplemental Conveyance, each constitutes a legal, valid and
binding obligation of the Account Owner enforceable against the Account
Owner in accordance with its terms,
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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
generally from time to time in effect or general principles of equity
(whether considered in a suit of law or in equity);
(ii) as of the Initial Cut-Off Date, and as of the related Addition
Cut-Off Date with respect to Additional Accounts, Schedule I to this
Agreement (composed of the list of accounts) as supplemented to such date,
is an accurate and complete listing in all material respects of all the
Accounts the Receivables in which were transferred and the information
contained therein with respect to the identity of such Accounts and the
Receivables existing thereunder is true and correct in all material
respects as of the Initial Cut-Off Date or such applicable Addition
Cut-Off Date, as the case may be, and as of the Initial Cut-Off Date, the
aggregate amount of Receivables in all the Initial Accounts was
$140,461,579.20, of which $140,138,079.03 were Principal Receivables;
(iii) each Receivable has been conveyed to the Corporation free and
clear of any Lien;
(iv) all authorizations, consents, orders or approvals of or
registrations or declarations with any Governmental Authority required to
be obtained, effected or given by the Account Owner in connection with the
conveyance of the Receivables to the Corporation have been duly obtained,
effected or given and are in full force and effect, except for
authorizations, consents, orders or other approvals of or registrations or
declarations which if not obtained, effected or given will not
individually or in the aggregate have any material adverse effect upon the
conveyance of the Receivables to the Corporation or the ability of the
Account Owner to enter into this Agreement and the Conveyance Papers or to
perform hereunder or thereunder;
(v) this Agreement and, in the case of Additional Accounts, any
related Supplemental Conveyance constitutes a valid sale, transfer and
assignment to the Corporation of all right, title and interest of the
Account Owner in the Receivables conveyed to the Corporation by the
Account Owner and the proceeds thereof; upon the filing of the financing
statements and, in the case of Receivables hereafter created and the
proceeds thereof, upon the creation thereof, the Corporation shall have a
first priority perfected ownership interest in such property and proceeds;
(vi) on the Initial Cut-Off Date, each Initial Account is an
Eligible Account and, in the case of Additional Accounts, on the Addition
Cut-Off Date, each related Additional Account is an Eligible Account;
(vii) on the Initial Cut-Off Date, each Receivable then existing and
conveyed to the Corporation is an Eligible Receivable, and in the case of
Additional Accounts, on the applicable Addition Cut-Off Date, each
Receivable contained in such Additional Account and conveyed to the
Corporation is an Eligible Receivable;
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(viii) as of the date of the creation of any new Receivable, such
Receivable is an Eligible Receivable; and
(ix) no selection procedures believed by the Account Owner to be
materially adverse to the interests of the Corporation or the Investor
Certificateholders have been used in selecting such Accounts.
(b) Notice of Breach. The representations and warranties set forth
in this Section 4.02 shall survive the transfer and assignment of the
Receivables to the Corporation and the transfer and assignment by the
Corporation to the Trust. Upon discovery by either the Account Owner, the
Corporation, the Servicer or the Trustee of a breach of any of the
representations and warranties set forth in this Section 4.02, the party
discovering such breach shall give prompt written notice to the others. The
Account Owner hereby acknowledges that the Corporation intends to rely on the
representations hereunder in connection with representations made by the
Corporation to secured parties, assignees or subsequent transferees including
but not limited to transfers made by the Corporation to the Trust pursuant to
the Pooling and Servicing Agreement and that the Trustee may enforce such
representations directly against the Account Owner.
Section 4.03. Representations and Warranties of the Corporation. As
of the Initial Closing Date, the Corporation hereby represents and warrants to,
and agrees with, the Account Owner that:
(a) Organization and Good Standing. The Corporation is a corporation
duly organized and validly existing under the laws of the State of Delaware and
has, in all material respects, full power and authority to own or lease its
properties and conduct its business as such properties are presently owned or
leased and such business is presently conducted and to execute, deliver and
perform its obligations under this Agreement.
(b) 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 the
Corporation by all necessary corporate action on the part of the Corporation.
(c) No Conflict. The execution and delivery of this Agreement and
the Conveyance Papers by the Corporation, 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 the Account
Owner, will not conflict with, result in any breach of any of the material terms
and provisions of, or constitute (with or without notice or lapse of time or
both) a material default under, any indenture, contract, agreement, mortgage,
deed of trust or other instrument to which the Corporation is a party or by
which it or any of its properties are bound.
(d) No Violation. The execution, delivery and performance of this
Agreement and the Conveyance Papers by the Corporation and the fulfillment of
the terms
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contemplated herein and therein applicable to the Corporation will not conflict
with or violate any Requirements of Law applicable to the Corporation.
(e) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of the Corporation, threatened against the
Corporation, before any court, regulatory body, administrative agency, or other
tribunal or governmental instrumentality (i) asserting the invalidity of this
Agreement or the Conveyance Papers, (ii) seeking to prevent the consummation of
any of the transactions contemplated by this Agreement or the Conveyance Papers,
(iii) seeking any determination or ruling that, in the reasonable judgment of
the Corporation, would materially and adversely affect the performance by the
Corporation of its obligations under this Agreement or the Conveyance Papers or
(iv) seeking any determination or ruling that, in the reasonable judgment of the
Corporation, would materially and adversely affect the validity or
enforceability of this Agreement or the Conveyance Papers.
(f) All Consents. All authorizations, consents, orders or approvals
of or registrations or declarations with any Governmental Authority required to
be obtained, effected or given by the Corporation in connection with the
execution and delivery by the Corporation of this Agreement and the Conveyance
Papers and the performance of the transactions contemplated by this Agreement
and the Conveyance Papers have been duly obtained, effected or given and are in
full force and effect; except for approvals, authorizations, consents or orders
which if not obtained will not individually or in the aggregate have any
material adverse effect upon the ability of the Corporation to execute, deliver
and perform under this Agreement and the Conveyance Papers.
The representations and warranties set forth in this Section 4.03
shall survive the conveyance of the Receivables to the Corporation and the
conveyance by the Corporation to the Trust. Upon discovery by the Corporation or
the Account Owner of a breach of any of the foregoing representations and
warranties, the party discovering such breach shall give written notice to the
other party and the Trustee within three Business Days following such discovery.
ARTICLE V
COVENANTS
Section 5.01. Covenants of the Account Owner. The Account Owner
hereby covenants and agrees with and for the benefit of the Corporation as
follows:
(a) Receivables To Be Accounts or General Intangibles. Except in
connection with its enforcement or collection of a Receivable, the Account Owner
will take no action to cause any Receivable to be evidenced by any instrument or
chattel paper (as defined in the UCC) and, if any Receivable is so evidenced, it
shall be deemed to be an Ineligible Receivable in accordance with Section
6.01(a) hereof and shall be reassigned to the Account Owner in accordance with
Section 6.01(b) hereof; provided, however, that
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Receivables evidenced by notes taken from Obligors in the ordinary course of
business of the Servicer's collection efforts shall not be deemed Ineligible
Receivables solely as a result thereof. In addition, the Account Owner agrees
that it will not take any other action to cause any Receivable to be anything
other than an "account" or a "general intangible" (as such terms are defined in
the UCC as in effect in the State of Delaware).
(b) Security Interests. Except for the conveyance hereunder, the
Account Owner will not sell, pledge, assign or transfer to any other Person, or
take any other action inconsistent with the Corporation's ownership of the
Receivables and other Purchased Assets or grant, create, incur, assume or suffer
to exist any Lien on any Receivable or other Purchased Assets, whether now
existing or hereafter created, or any interest therein, and the Account Owner
shall not claim any ownership interest in the Receivables or in other Purchased
Assets and shall defend the right, title and interest of the Corporation in, to
and under the Receivables and other Purchased Assets, whether now existing or
hereafter created, against all claims of third parties claiming through or under
the Account Owner; provided, however, that nothing in this subsection 5.01(b)
shall prevent or be deemed to prohibit the Account Owner from suffering to exist
upon any of the Receivables transferred by it to the Corporation any Liens for
municipal or other local taxes if such taxes shall not at the time be due and
payable or if the Account Owner shall be currently contesting the validity
thereof in good faith by appropriate proceedings and shall have set aside on its
books adequate reserves with respect thereto.
(c) Account Allocations. In the event that the Account Owner is
unable for any reason to transfer Receivables to the Corporation in accordance
with the provisions of this Agreement (including, without limitation, by reason
of the application of the provisions of Section 8.02 hereof or any order of any
Governmental Authority), then, in any such event, the Account Owner agrees
(except as prohibited by any such order) to allocate and pay to the Corporation,
after the date of such inability, all amounts in the manner by which the
Corporation will allocate and pay to the Trust after such inability by the
Corporation pursuant to Section 2.11 of the Pooling and Servicing Agreement.
(d) Delivery of Collections. In the event that the Account Owner
receives Collections, the Account Owner agrees to pay to the Corporation (or to
the Servicer if the Corporation so directs) all such Collections as soon as
practicable after receipt thereof.
(e) Notice of Liens. The Account Owner shall notify the Corporation
promptly after becoming aware of any Lien on any Receivable other than the
conveyances hereunder and under the Pooling and Servicing Agreement or Liens
permitted under subsection 5.01(b) hereof.
(f) Documentation of Transfer. The Account Owner shall undertake to
file the documents which would be necessary to perfect and maintain the transfer
of the Purchased Assets to the Corporation. This Agreement and any amendments
hereto will be maintained, continuously, as an official record of the Account
Owner.
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(g) Sale. The Account Owner agrees to treat the Conveyance, for all
purposes (including all relevant tax and financial accounting purposes) as a
sale on all federal and state tax returns, financial statements and other
applicable documents.
Section 5.02. Covenants of the Account Owner with Respect to
Portfolio Yield and Cardholder Agreements. The Account Owner, hereby agrees, for
the benefit of the Corporation that:
(a) Periodic Finance Charges and Other Fees. (i) Except (x) as
otherwise required by any Requirement of Law, or (y) as is deemed by the Account
Owner to be necessary in order for it to maintain its credit card business on a
competitive basis based on a good faith assessment by it of the nature of its
competition in the credit card business, it shall not at any time reduce the
annual percentage rate of the Periodic Finance Charges assessed on the
Receivables transferred by it to the Corporation or other fees charged on any of
the Accounts if, as a result of any such reduction, either (i) the Account
Owner's reasonable expectation is that such reduction will cause a Pay Out Event
or Reimbursement Event to occur or (ii) such reduction is not also applied to
any comparable segments of consumer revolving credit card accounts owned by the
Account Owner which have characteristics the same as, or substantially similar
to, such Accounts.
(b) Cardholder Agreements and Credit Card Guidelines. The Account
Owner shall comply with and perform its obligations under the Cardholder
Agreements relating to the Accounts and the Credit Card Guidelines and all
applicable rules and regulations of MasterCard and VISA or their respective
substantial equivalents except insofar as any failure so to comply or perform
would not materially and adversely affect the rights of the Trust or the
Certificateholders under the Pooling and Servicing Agreement. Subject to
compliance with all Requirements of Law, the Account Owner may change the terms
and provisions of the Cardholder Agreements or the Credit Card Guidelines with
respect to any of the Accounts in any respect (including the calculation of the
amount or the timing, of charge-offs and the Periodic Finance Charges and other
fees to be assessed thereon) only if in the reasonable judgment of the Account
Owner such change is made applicable to any comparable segment of the consumer
revolving credit card accounts owned by the Account Owner which have
characteristics the same as, or substantially similar to, such Accounts.
(c) MasterCard and VISA. The Account Owner, to the extent applicable
to Accounts owned or serviced by it, shall use its best efforts to remain,
either directly or indirectly, a member in good standing of the MasterCard
system, the VISA system and any other similar entity's or organization's system
relating to any other type of consumer revolving credit card accounts included
as Accounts.
(d) Provide Information. The Corporation covenants that, if, at any
time, the Account Owner is not the Servicer under the Pooling and Servicing
Agreement, the Corporation will provide the Account Owner with such information
as the Account Owner may reasonably request to enable the Account Owner to
determine compliance with the covenants contained in Section 5.02(a) and (b)
above.
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ARTICLE VI
REPURCHASE OBLIGATION
Section 6.01. Reassignment of Ineligible Receivables.
(a) In the event (i) any representation or warranty under Section
4.02(a)(ii), (iii), (iv), (vi), (vii), (viii) or (ix) is not true and correct in
any material respect as of the date specified therein with respect to any
Receivable or the related Account or (ii) there is a breach of the covenant set
forth in Section 5.01(a) hereof and as a result of such untrue or incorrect
representation or warranty or such breach the Corporation is required to accept
reassignment of Ineligible Receivables previously sold by the Account Owner to
the Corporation pursuant to Section 2.05(a) of the Pooling and Servicing
Agreement, the Account Owner shall accept reassignment of the Corporation's
interest in such Ineligible Receivables on the terms and conditions set forth in
Section 6.01(b) hereof.
(b) the Account Owner shall accept reassignment of any Ineligible
Receivables previously sold by the Account Owner to the Corporation from the
Corporation on the date on which such reassignment obligation arises, and shall
pay for such reassigned Ineligible Receivables by paying to the Corporation, not
later than 3:00 p.m., New York City time on such date, an amount equal to the
unpaid principal balance of such Ineligible Receivables plus accrued and unpaid
finance charges at the annual percentage rate applicable to such Receivables
from the last date billed through the end of the Monthly Period in which such
reassignment obligation arises (the "Repurchase Price"). Upon reassignment of
such Ineligible Receivables, the Corporation shall automatically and without
further action be deemed to sell, transfer, assign, set-over and otherwise
convey to the Account Owner, without recourse, representation or warranty, all
the right, title and interest of the Corporation in and to such Ineligible
Receivables, all monies due or to become due with respect thereto and all
proceeds thereof; and such reassigned Ineligible Receivables shall be treated by
the Corporation as collected in full as of the date on which they were
transferred. The Corporation shall execute such documents and instruments of
transfer or assignment and take such other actions as shall reasonably be
requested by the Account Owner to effect the conveyance of such Ineligible
Receivables pursuant to this subsection.
Section 6.02. Reassignment of Receivables in Trust Portfolio. In the
event any representation or warranty set forth in Section 4.01(a) or (c) or
Section 4.02(a)(i) or (a)(v) hereof is not true and correct in any material
respect and, as a result of such breach, the Corporation is required to accept a
reassignment of the Receivables previously sold by the Account Owner to the
Corporation pursuant to Section 2.06 of the Pooling and Servicing Agreement, the
Account Owner shall be obligated to accept a reassignment of the Corporation's
interest in such Receivables on the terms set forth below.
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The Account Owner shall pay to the Corporation by depositing 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 amount specified in Section 2.06 of the Pooling and
Servicing Agreement.
ARTICLE VII
CONDITIONS PRECEDENT
Section 7.01. Conditions to the Corporation's Obligations Regarding
Initial Receivables. The obligations of the Corporation to purchase the
Receivables in the Initial Accounts on the Initial Closing Date shall be subject
to the satisfaction of the following conditions:
(a) All representations and warranties of the Account Owner
contained in this Agreement shall be true and correct on the Initial Closing
Date with the same effect as though such representations and warranties had been
made on such date;
(b) All information concerning the Initial Accounts provided to the
Corporation shall be true and correct in all material respects as of the Initial
Cut-Off Date;
(c) the Account Owner shall have (i) delivered to the Corporation a
schedule of Accounts as of the Initial Cut-Off Date and (ii) substantially
performed all other obligations required to be performed by the provisions of
this Agreement;
(d) the Account Owner shall have recorded and filed, at its expense,
any financing statement with respect to the Receivables (other than Receivables
in Additional Accounts) now existing and hereafter created for the transfer of
accounts and general intangibles (each as defined in Section 9-106 of the UCC)
meeting the requirements of applicable state law in such manner and in such
jurisdiction as would be necessary to perfect the sale of and security interest
in the Receivables and other Purchased Assets from the Account Owner to the
Corporation, and shall deliver a file-stamped copy of such financing statements
or other evidence of such filings to the Corporation;
(e) On or before the Initial Closing Date, the Corporation and the
Trustee shall have entered into the Pooling and Servicing Agreement and the
closing under the Pooling and Servicing Agreement shall take place
simultaneously with the initial closing hereunder; and
(f) All corporate and legal proceedings and all instruments in
connection with the transactions contemplated by this Agreement shall be
satisfactory in form and substance to the Corporation, and the Corporation shall
have received from the Account Owner copies of all documents (including, without
limitation, records of corporate proceedings) relevant to the transactions
herein contemplated as the Corporation may reasonably have requested.
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Section 7.02. Conditions Precedent to the Account Owner's
Obligations. The obligations of the Account Owner to sell Receivables in the
Initial Accounts on the Initial Closing Date shall be subject to the
satisfaction of the following conditions:
(a) All representations and warranties of the Corporation contained
in this Agreement shall be true and correct with the same effect as though such
representations and warranties had been made on such date;
(b) Payment or provision for payment of the Purchase Price in
accordance with the provision of Section 3.01 hereof shall have been made; and
(c) All corporate and legal proceedings and all instruments in
connection with the transactions contemplated by this Agreement shall be
satisfactory in form and substance to the Account Owner, and the Account Owner
shall have received from the Corporation copies of all documents (including,
without limitation, records of corporate proceedings) relevant to the
transactions herein contemplated as the Account Owner may reasonably have
requested.
ARTICLE VIII
TERM AND PURCHASE TERMINATION
Section 8.01. Term. This Agreement shall commence as of the date of
execution and delivery hereof and shall continue until the termination of the
Trust as provided in Article XII of the Pooling and Servicing Agreement.
Section 8.02. Purchase Termination. If the Account Owner shall fail
generally to, or admit in writing its inability to, pay its debts as they become
due; or if a proceeding shall have been instituted in a court having
jurisdiction in the premises seeking a decree or order for relief in respect of
the Account Owner 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 the Account Owner or for
any substantial part of the Account Owner's property, or for the winding-up or
liquidation of the Account Owner's affairs and, if instituted against the
Account Owner, 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 if the Account Owner shall commence a voluntary
case under any Debtor Relief Law, or if the Account Owner shall 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, or for, any substantial part of its property, or any general
assignment for the benefit of its creditors; or the Account Owner or any
subsidiary of the Account Owner shall have taken any corporate action in
furtherance of any of the foregoing actions (each an "Insolvency Event"); then
the Account Owner shall immediately cease to transfer Principal Receivables to
the Corporation and shall promptly give notice to the Corporation and the
Trustee of such Insolvency Event.
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Notwithstanding any cessation of the transfer to the Corporation of additional
Principal Receivables, Principal Receivables transferred to the Corporation
prior to the occurrence of such Insolvency Event and Collections in respect of
such Principal Receivables and Finance Charge Receivables whenever created,
accrued in respect of such Principal Receivables, shall continue to be property
of the Corporation available for transfer by the Corporation to the Trust
pursuant to the Pooling and Servicing Agreement.
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.01. 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 the Corporation and the
Account Owner in accordance with this Section 9.01. This Agreement and any
Conveyance Papers may be amended from time to time by the Corporation and the
Account Owner (i) to cure any ambiguity, (ii) to correct or supplement any
provisions herein which may be inconsistent with any other provisions herein or
in any such other Conveyance Papers, (iii) to add any other provisions with
respect to matters or questions arising under this Agreement or any Conveyance
Papers which shall not be inconsistent with the provisions of this Agreement or
any Conveyance Papers, (iv) to change or modify the Purchase Price and (v) to
change, modify, delete or add any other obligation of the Account Owner or the
Corporation; provided, however, that no amendment pursuant to clause (iv) or (v)
of this Section 9.01 shall be effective unless the Account Owner and the
Corporation have been notified in writing that the Rating Agency Condition has
been satisfied; provided, further, that such action shall not (as evidenced by
an Opinion of Counsel delivered to the Trustee) adversely affect in any material
respect the interests of the Trustee or the Investor Certificateholders, unless
the Trustee shall consent thereto. Any reconveyance executed in accordance with
the provisions hereof shall not be considered to be an amendment to this
Agreement. A copy of any amendment to this Agreement shall be sent to each
Rating Agency.
Section 9.02. Governing Law. THIS AGREEMENT AND THE CONVEYANCE
PAPERS 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 9.03. Notices. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered at or mailed by registered mail, return receipt requested,
to (a) in the case of the Account Owner, Travelers Bank & Trust, fsb, 100
Commerce Drive, Newark, Delaware 19713 (telephone: 302-454-5500), (b) in the
case of the Corporation, CC Credit Card Corporation, 100 Commerce Drive, Suite
300B, Newark, Delaware 19713 (telephone: 302-451-6456), or (c) in the case of
the Trustee, The Bank of New York, 101 Barclay Street, 21 West, New York,
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New York 10286, Attention: Corporate Trust Department--Trustee; 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 9.04. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement or any Conveyance
Paper shall for any reason whatsoever be held invalid, then such covenants,
agreements, provisions, or terms shall be 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 9.05. Assignment. Notwithstanding anything to the contrary
contained herein, other than the Corporation's assignment of its rights, title,
and interests in, to, and under this Agreement to the Trustee for the benefit of
the beneficiaries of the Trust, including the Certificateholders as contemplated
by the Pooling and Servicing Agreement and Section 9.06 hereof, this Agreement
and all other Conveyance Papers may not be assigned by the parties hereto;
provided, however, that the Account Owner shall have the right to assign its
rights, title and interests, in to and under this Agreement to (i) any successor
by merger assuming this Agreement (ii) to any affiliate owned directly or
indirectly by Commercial Credit Company which assumes the obligations of this
Agreement or (iii) to any entity provided that the Rating Agency Condition has
been satisfied.
Section 9.06. Acknowledgement and Agreement of the Account Owner. By
execution below, the Account Owner expressly acknowledges and agrees that all of
the Corporation's right, title, and interest in, to, and under this Agreement,
including, without limitation, all of the Account Owner's right, title, and
interest in and to the Receivables and other Purchased Assets purchased pursuant
to this Agreement, shall be assigned by the Corporation to the Trustee for the
benefit of the beneficiaries of the Trust, including the Certificateholders, and
the Corporation consents to such assignment. The Account Owner further agrees
that notwithstanding any claim, counterclaim, right of setoff or defense which
it may have against the Corporation, due to a breach by the Corporation of this
Agreement or for any other reason, and notwithstanding the bankruptcy of the
Corporation or any other event whatsoever, the Account Owner's sole remedy shall
be a claim against the Corporation for money damages and, then only to the
extent of funds received by the Corporation pursuant to the Pooling and
Servicing Agreement, and in no event shall the Corporation assert any claim on
or any interest in the Receivables and other Purchased Assets or any proceeds
thereof or take any action which would reduce or delay receipt by
Certificateholders of collections with respect to the Receivables and other
Purchased Assets. Additionally, the Account Owner agrees for the benefit of the
Trustee that any amounts payable by the Account Owner to the Corporation
hereunder which are to be paid by the Corporation to the Trustee for the benefit
of the Certificateholders shall be paid by the Corporation, on behalf of the
Corporation, directly to the Trustee.
Section 9.07. Further Assurances. The Account Owner and the
Corporation agree to do and perform, from time to time, any and all acts and to
execute any and all further instruments required or reasonably requested by the
other party or the Trustee more
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fully to effect the purposes of this Agreement, the Conveyance Papers and the
Pooling and Servicing Agreement, including, without limitation, the execution of
any financing statements or continuation statements or equivalent documents
relating to the Receivables and other Purchased Assets for filing under the
provisions of the UCC or other law of any applicable jurisdiction.
Section 9.08. No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of the Corporation or the Account Owner,
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. Subject to Section
9.06, the rights, remedies, powers and privileges herein provided are cumulative
and not exhaustive of any rights, remedies, powers and privileges provided by
law.
Section 9.09. 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 9.10. 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
Trustee shall be considered a third-party beneficiary of this Agreement.
Section 9.11. Merger and Integration. Except as specifically stated
otherwise herein, this Agreement and the Conveyance Papers set forth the entire
understanding of the parties relating to the subject matter hereof, and all
prior understandings, written or oral, are superseded by this Agreement and the
Conveyance Papers. This Agreement and the Conveyance Papers may not be modified,
amended, waived or supplemented except as provided herein.
Section 9.12. Headings. The headings are for purposes of reference
only and shall not otherwise affect the meaning or interpretation of any
provision hereof.
Section 9.13. Schedules and Exhibits. The schedules and exhibits
attached hereto and referred to herein shall constitute a part of this Agreement
and are incorporated into this Agreement for all purposes.
Section 9.14. Survival of Representations and Warranties. All
representations, warranties and agreements contained in this Agreement or
contained in any Supplemental Conveyance, shall remain operative and in full
force and effect and shall survive conveyance of the Receivables by the
Corporation to the Trust pursuant to the Pooling and Servicing Agreement.
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Section 9.15. Nonpetition Covenant. Notwithstanding any prior
termination of this Agreement, the Account Owner shall not, prior to the date
which is one year and one day after the termination of this Agreement,
acquiesce, petition or otherwise invoke or cause the Corporation to invoke the
process of any Governmental Authority for the purpose of commencing or
sustaining a case against the Corporation 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 Corporation or
any substantial part of its property or ordering the winding-up or liquidation
of the affairs of the Corporation.
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IN WITNESS WHEREOF, the Corporation and the Account Owner have
caused this Receivables Transfer Agreement to be duly executed by their
respective officers as of the day and year first above written.
TRAVELERS BANK & TRUST, fsb,
as Account Owner
By: /s/ Charles Haug
-------------------------
Name: Charles Haug
Title: SVP & CFO
CC CREDIT CARD CORPORATION,
as Corporation
By: /s/ Barbara Yastine
-------------------------
Name: Barbara Yastine
Title: President
[Signature Page to Receivables Transfer Agreement]
<PAGE>
EXHIBIT A
FORM OF SUPPLEMENTAL CONVEYANCE
(As required by Section 2.04 of
the Receivables Transfer Agreement)
SUPPLEMENTAL CONVEYANCE No. dated as of , 19 , by and between
TRAVELERS BANK & TRUST, fsb, as Account Owner ("the Account Owner"), and CC
CREDIT CARD CORPORATION as Corporation (the "Corporation"), pursuant to the
Receivables Transfer Agreement referred to below.
WITNESSETH:
WHEREAS, the Corporation and the Account Owner are parties to a
Receivables Transfer Agreement, dated as of March 1, 1998 (hereinafter as such
agreement may have been, or may from time to time be, amended, supplemented or
otherwise modified, the "Receivables Transfer Agreement");
WHEREAS, pursuant to the Receivables Transfer Agreement, the
Corporation wishes to designate Additional Accounts to be included as Accounts
and the Account Owner wishes to convey its right, title and interest in the
Receivables of such Additional Accounts, whether now existing or hereafter
created, to the Corporation pursuant to the Receivables Transfer Agreement (as
each such term is defined in the Receivables Transfer Agreement); and
WHEREAS, the Corporation is willing to accept such designation and
conveyance subject to the terms and conditions hereof.
NOW, THEREFORE, the Corporation and the Account Owner hereby agree
as follows:
1. Defined Terms. All capitalized terms used herein shall have the
meanings ascribed to them in the Receivables Transfer Agreement unless otherwise
defined herein.
"Addition Date" shall mean, with respect to the Additional Accounts
designated hereby, ________________, 19__.
"Addition Cut-Off Date" shall mean, with respect to the Additional
Accounts designated hereby, _________ __, 19__.
2. Designation of Additional Accounts. The Account Owner delivers
herewith a computer file or microfiche list containing a true and complete
schedule
A-1
<PAGE>
identifying all such Additional Accounts and 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 in
such Account. Such computer file, microfiche list or other documentation (each
an "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) The Account Owner does hereby sell, transfer, assign, set over
and otherwise convey to the Corporation, without recourse except as provided in
the Receivables Transfer Agreement, all its right, title and interest in, to and
under the Receivables generated by such Additional Accounts, existing at the
close of business on the Addition Cut-Off Date and thereafter created until
termination of the Receivables Transfer Agreement, all monies due or to become
due and all amounts received with respect thereto and all "proceeds" (including,
without limitation, "proceeds" as defined in Article 9 of the UCC) thereof (but
not including the right to receive Recoveries with respect to such Receivables).
(b) In connection with such sale, the Account Owner agrees to record
and file, at its own expense, one or more financing statements (and continuation
statements with respect to such financing statements when applicable) with
respect to the Receivables now existing and hereafter created, for the transfer
of accounts and general intangibles meeting the requirements of applicable state
law in such manner and in such jurisdictions as are necessary to perfect the
sale and assignment of and the security interest in the Receivables to the
Corporation, and to deliver a file-stamped copy of such financing statement or
other evidence of such filing to the Corporation.
(c) In connection with such sale, the Account Owner further agrees,
at its own expense, on or prior to the date of this Supplemental Conveyance, (i)
to indicate in its computer files with the code ____ or ____ or any other
clearly specified code in the FDR Account Flagged field of such computer files
that the Receivables created in connection with such Additional Accounts have
been conveyed to the Corporation in accordance with the Receivables Transfer
Agreement and this Supplemental Conveyance and have been conveyed by the
Corporation to the Trustee pursuant to the Pooling and Servicing Agreement for
the benefit of the Certificateholders by including in such computer files the
code identifying each such Account and (ii) to deliver to the Corporation or the
Trustee, as the Corporation's nominee, a computer file or microfiche list
containing a true and complete list of all Receivables created in connection
with the Additional Accounts designated hereby which have been conveyed to the
Corporation pursuant to this Supplemental Conveyance.
4. Acceptance by the Corporation. The Corporation hereby
acknowledges its acceptance of all right, title and interest to the property,
now existing and hereafter created, conveyed to the Corporation pursuant to
Section 3(a) of this Supplemental Conveyance, and declares that it shall
maintain such right, title and interest. The Corporation further acknowledges
that, prior to or simultaneously with the execution and delivery of this
Supplemental Conveyance, the Account Owner delivered to the Corporation the
computer file or microfiche list described in Section 2 of this Supplemental
Conveyance.
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5. Representations and Warranties of the Account Owner. The Account
Owner hereby represents and warrants to the Corporation as of the date of this
Supplemental Conveyance and as of the Addition Date that:
(a) Legal, Valid and Binding Obligation. This Supplemental
Conveyance constitutes a legal, valid and binding obligation of the Account
Owner enforceable against the Account Owner in accordance with its terms, except
as such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally from time to time in effect or general principles of equity;
(b) Eligibility of Accounts. On the Addition Cut-Off Date, each
Additional Account designated hereby is an Eligible Account;
(c) No Liens. Each Receivable in an Additional Account designated
hereby has been conveyed to the Corporation free and clear of any Lien;
(d) Eligibility of Receivables. On the Addition Cut-Off Date, each
Receivable existing in an Additional Account designated hereby is an Eligible
Receivable and as of the date of creation of any Receivable in an Additional
Account designated hereby, such Receivable is an Eligible Receivable;
(e) Selection Procedures. No selection procedure believed by the
Account Owner to be adverse to the interests of the Corporation or the Investor
Certificateholders was utilized in selecting the Additional Accounts;
(f) Transfer of Receivables. This Supplemental Conveyance
constitutes a valid sale, transfer and assignment to the Corporation of all
right, title and interest of the Account Owner in the Receivables arising in the
Additional Accounts designated hereby now existing or hereafter created, all
monies due or to become due, all amounts received with respect thereto, the
"proceeds" (including, without limitation, "proceeds" as defined in Article 9 of
the UCC) thereof and the Recoveries with respect thereto;
(g) No Conflict. The execution and delivery of this Supplemental
Conveyance, the performance of the transactions contemplated by this
Supplemental Conveyance and the fulfillment of the terms hereof, will not
conflict with, result in any breach of any of the material terms and provisions
of, or constitute (with or without notice or lapse of time or both) a material
default under, any indenture, contract, agreement, mortgage, deed of trust or
other instrument to which the Account Owner is a party or by which it or its
properties are bound;
(h) No Violation. The execution and delivery of this Supplemental
Conveyance by the Account Owner, the performance of the transactions
contemplated by this Supplemental Conveyance and the fulfillment of the terms
hereof applicable to the Account Owner will not conflict with or violate any
Requirements of Law applicable to the Account Owner;
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<PAGE>
(i) No Proceedings. There are no proceedings or investigations,
pending or, to the best knowledge of the Account Owner, threatened against the
Account Owner before any Governmental Authority (i) asserting the invalidity of
this Supplemental Conveyance, (ii) seeking to prevent the consummation of any of
the transactions contemplated by this Supplemental Conveyance, (iii) seeking any
determination or ruling that, in the reasonable judgment of the Account Owner,
would materially and adversely affect the performance by the Account Owner of
its obligations under this Supplemental Conveyance or (iv) seeking any
determination or ruling that would materially and adversely affect the validity
or enforceability of this Supplemental Conveyance; and
(j) All Consents. All authorizations, consents, orders or approvals
of any court or other governmental authority required to be obtained by the
Account Owner in connection with the execution and delivery of this Supplemental
Conveyance by the Account Owner and the performance of the transactions
contemplated by this Supplemental Conveyance by the Account Owner, have been
obtained, except for authorizations, consents, orders or approvals which, if not
obtained, will not individually or in the aggregate have any material adverse
effect upon the conveyance of the Receivables to the Corporation or the ability
of the Account Owner to execute and deliver this Supplemental Conveyance or to
perform the transactions contemplated hereby.
6. Ratification of the Receivables Transfer Agreement. The
Receivables Transfer Agreement is hereby ratified, and all references to the
"Receivables Transfer Agreement," to "this Agreement" and "herein" shall be
deemed from and after the Addition Date to be a reference to the Receivables
Transfer Agreement as supplemented by this Supplemental Conveyance. Except as
expressly amended hereby, all the representations, warranties, terms, covenants
and conditions of the Receivables Transfer 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 Transfer Agreement.
7. Counterparts. This Supplemental Conveyance may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument.
8. Governing Law. This Supplemental Conveyance shall be construed in
accordance with the laws of the State of Delaware, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined is accordance with such laws.
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<PAGE>
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.
CC CREDIT CARD CORPORATION
By: __________________________________
Name:_____________________________
Title:____________________________
TRAVELERS BANK & TRUST, fsb
By: __________________________________
Name:_____________________________
Title:____________________________
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<PAGE>
Schedule I to
Supplemental
Conveyance
Additional Accounts
A-6
<PAGE>
Schedule I
to Receivables
Transfer Agreement
LIST OF ACCOUNTS
DEEMED INCORPORATED BY REFERENCE
Exhibit 10.2
EXECUTION COPY
- --------------------------------------------------------------------------------
CC CREDIT CARD CORPORATION,
as Corporation
and
THE TRAVELERS BANK USA,
as Account Owner
RECEIVABLES TRANSFER AGREEMENT
Dated as of March 1, 1998
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
DEFINITIONS
Section 1.01. Definitions.................................................. 1
Section 1.02. Other Definitional Provisions................................ 4
ARTICLE II
PURCHASE AND CONVEYANCE OF RECEIVABLES
Section 2.01. Purchase..................................................... 4
Section 2.02. Addition of Additional Accounts.............................. 6
Section 2.03. Representations and Warranties............................... 7
Section 2.04. Delivery of Documents........................................ 7
ARTICLE III
CONSIDERATION AND PAYMENT
Section 3.01. Purchase Price............................................... 8
Section 3.02. Adjustments to Purchase Price................................ 8
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01. Representations and Warranties of the Account Owner
Relating to the Account Owner................................ 9
Section 4.02. Representations and Warranties of the Account Owner
Relating to the Agreement and the Receivables................ 10
Section 4.03. Representations and Warranties of the Corporation............ 12
ARTICLE V
COVENANTS
Section 5.01. Covenants of the Account Owner............................... 13
Section 5.02. Covenants of the Account Owner with Respect to Portfolio
Yield and Cardholder Agreements.............................. 15
i
<PAGE>
ARTICLE VI
REPURCHASE OBLIGATION
Section 6.01. Reassignment of Ineligible Receivables....................... 16
Section 6.02. Reassignment of Receivables in Trust Portfolio............... 16
ARTICLE VII
CONDITIONS PRECEDENT
Section 7.01. Conditions to the Corporation's Obligations Regarding Initial
Receivables.................................................. 17
Section 7.02. Conditions Precedent to the Account Owner's Obligations...... 18
TERM AND PURCHASE TERMINATION
Section 8.01. Term......................................................... 18
Section 8.02. Purchase Termination......................................... 18
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.01. Amendment.................................................... 19
Section 9.02. Governing Law................................................ 19
Section 9.03. Notices...................................................... 19
Section 9.04. Severability of Provisions................................... 20
Section 9.05. Assignment................................................... 20
Section 9.06. Acknowledgement and Agreement of the Account Owner........... 20
Section 9.07. Further Assurances........................................... 20
Section 9.08. No Waiver; Cumulative Remedies............................... 21
Section 9.09. Counterparts................................................. 21
Section 9.10. Binding; Third-Party Beneficiaries........................... 21
Section 9.11. Merger and Integration....................................... 21
Section 9.12. Headings..................................................... 21
Section 9.13. Schedules and Exhibits....................................... 21
Section 9.14. Survival of Representations and Warranties................... 21
Section 9.15. Nonpetition Covenant......................................... 22
ii
<PAGE>
RECEIVABLES TRANSFER AGREEMENT, dated as of March 1, 1998, by and
between THE TRAVELERS BANK USA, a Delaware state chartered banking corporation
(the "Account Owner"), and CC CREDIT CARD CORPORATION, a Delaware corporation
(the "Corporation").
W I T N E S S E T H:
WHEREAS, the Corporation desires to purchase, from time to time,
certain Receivables (hereinafter defined) arising in certain credit card
accounts of the Account Owner;
WHEREAS, the Account Owner desires to sell from time to time and
assign certain Receivables to the Account Owner upon the terms and conditions
hereinafter set forth;
WHEREAS, it is contemplated that the Receivables purchased hereunder
will be transferred by the Corporation to the Trust (hereinafter defined) in
connection with the issuance of certain Certificates (hereinafter defined); and
WHEREAS, the Account Owner agrees that all covenants and agreements
made by the Account Owner herein with respect to the Accounts (hereinafter
defined) and Receivables shall also be for the benefit of the Trustee
(hereinafter defined) and all beneficiaries of the Trust, including the holders
of the Certificates.
NOW, THEREFORE, it is hereby agreed by and between the Account Owner
and the Corporation as follows:
ARTICLE I
DEFINITIONS
Section 1.01. Definitions. All capitalized terms used herein or in
any certificate, document, or Conveyance Paper made or delivered pursuant
hereto, and not defined herein or therein, shall have the meaning ascribed
thereto in the Pooling and Servicing Agreement; in addition, the following words
and phrases shall have the following meanings:
"Account" shall mean each Initial Account and each Additional
Account (but only from and after the Addition Date with respect thereto) but
shall exclude any Account in which all the Receivables are either reassigned or
assigned to the Corporation or its designee or to the Servicer in accordance
with the terms of the Pooling and Servicing Agreement and shall exclude any
Account all the Receivables in which are, after the Removal Date, not to be
assigned to the Corporation pursuant to subsection 2.01(e) hereof. The
definition of Account shall include each account into which an Account shall be
transferred (a
<PAGE>
"Transferred Account"), provided that (i) such transfer is made in
accordance with the Credit Card Guidelines and (ii) such Transferred Account can
be traced or identified as an account into which an Account has been
transferred.
"Account Owner" shall mean The Travelers Bank USA, a Delaware state
chartered banking corporation.
"Additional Account" shall mean each consumer revolving credit card
account established pursuant to a Cardholder Agreement, which account is
designated by the Account Owner pursuant to Section 2.01 or 2.02 hereof to be
included as an Account and which is identified in a computer file or microfiche
list delivered to the Corporation or to the Trustee pursuant to subsection
2.01(c) or Section 2.04.
"Addition Cut-Off Date" shall mean with respect to any Additional
Accounts the date specified in the related Assignment.
"Addition Date" shall mean with respect to Additional Accounts, the
date on which the Receivables in such Additional Accounts are conveyed to the
Trust pursuant to Section 2.02.
"Addition Notice Date" shall have the meaning specified in Section
2.02 of this Agreement.
"Agreement" shall mean this Receivables Transfer Agreement and all
amendments hereof and supplements hereto.
"Conveyance" shall have the meaning specified in subsection 2.01(a).
"Conveyance Papers" shall have the meaning specified in subsection
4.01(c).
"Corporation" shall mean CC Credit Card Corporation, a Delaware
corporation, and its permitted successors and assigns.
"Credit Adjustment" shall have the meaning specified in Section
3.02.
"Debtor Relief Laws" shall mean (i) the Bankruptcy Code of the
United States of America and (ii) all other applicable liquidation,
conservatorship, bankruptcy, moratorium, rearrangement, receivership,
insolvency, reorganization, suspension of payments, readjustment of debt,
marshalling of assets or similar debtor relief laws of the United States, any
state or any foreign country from time to time in effect affecting the rights of
creditors generally.
"Finance Charge Receivables" shall mean all Receivables in the
Accounts which would be treated as "Finance Charge Receivables" in accordance
with the Pooling and Servicing Agreement.
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<PAGE>
"Initial Account" shall mean each MasterCard(R) and VISA(R)1 account
established pursuant to a Cardholder Agreement between The Travelers Bank USA
and any person, and identified by account number and by the Receivable balance
in a computer file or microfiche list delivered to the Trustee by the
Corporation on or prior to the Initial Closing Date pursuant to subsection
2.01(c).
"Initial Closing Date" shall mean March 6, 1998.
"Initial Cut-Off Date" shall mean December 31, 1997.
"Insolvency Event" shall have the meaning specified in Section 8.02.
"New Principal Receivables" shall have the meaning set forth in
Section 3.01.
"Obligor" shall mean, with respect to each Account, each person that
would be treated as an "Obligor" in accordance with the definition for such term
in the Pooling and Servicing Agreement.
"Pooling and Servicing Agreement" shall mean the Pooling and
Servicing Agreement, dated as of March 1, 1998, among CC Credit Card
Corporation, as Transferor, Travelers Bank & Trust, fsb, in its individual
capacity and as Servicer, and the Trustee, together with all amendments and
supplements thereto.
"Portfolio Reassignment Price" shall mean that portion of the amount
payable by the Corporation to the Trustee pursuant to Section 2.06 of the
Pooling and Servicing Agreement which is allocable to the Receivables in
Accounts of the Account Owner hereunder.
"Principal Receivables" shall mean all Receivables in the Accounts
that would be treated as "Principal Receivables" in accordance with the
definition for such term in the Pooling and Servicing Agreement.
"Purchase Price" shall have the meaning set forth in Section 3.01.
"Purchased Assets" shall have the meaning set forth in Section 2.01.
"Receivables" shall mean all amounts shown on the Servicer's records
as amounts payable by Obligors on any Account with respect to which the Account
Owner hereunder is the Account Owner, from time to time, including amounts
payable for Principal Receivables and Finance Charge Receivables. Receivables
which become Defaulted Receivables will cease to be included as Receivables as
of the day on which they become Defaulted Receivables.
- ------------------
1 MasterCard and VISA are registered trademarks of MasterCard International
Incorporated and of VISA USA, Inc., respectively.
3
<PAGE>
"Removed Account" shall mean an Account hereunder that is a "Removed
Account" (as such term is defined in the Pooling and Servicing Agreement) that
is designated for removal pursuant to Section 2.10 of the Pooling and Servicing
Agreement.
"Repurchase Price" shall have the meaning set forth in subsection
6.01(b) hereof.
"Supplemental Conveyance" shall have the meaning set forth in
Section 2.04.
"Trust" shall mean the Travelers Bank Credit Card Master Trust I
created by the Pooling and Servicing Agreement.
"Trustee" shall mean The Bank of New York, a New York banking
corporation, the institution executing the Pooling and Servicing Agreement as,
and acting in the capacity of Trustee thereunder, or its successor in interest,
or any successor trustee appointed as provided in the Pooling and Servicing
Agreement.
Section 1.02. Other Definitional Provisions.
(a) All terms defined in this Agreement shall have the defined
meanings when used in any certificate, other document, or Conveyance Paper made
or delivered pursuant hereto unless otherwise defined therein.
(b) The words "hereof," "herein" and "hereunder" and words of
similar import when used in this Agreement or any Conveyance Paper shall refer
to this Agreement as a whole and not to any particular provision of this
Agreement; and Section, subsection, Schedule and Exhibit references contained in
this Agreement are references to Sections, subsections, Schedules and Exhibits
in or to this Agreement, as such Sections, subsections, Schedules and Exhibits
may be amended, unless otherwise specified.
(c) All determinations of the principal or finance charge balance of
Receivables, and of any collections thereof, shall be made in accordance with
the Pooling and Servicing Agreement and all applicable Supplements.
ARTICLE II
PURCHASE AND CONVEYANCE OF RECEIVABLES
Section 2.01. Purchase.
(a) By execution of this Agreement, the Account Owner does hereby
sell, transfer, assign, set over and otherwise convey to the Corporation
(collectively, the "Conveyance"), without recourse except as provided herein,
all its right, title and interest in, to and under the Receivables existing at
the close of business on the Initial Cut-Off Date, in the case of Receivables
arising in the Initial Accounts, and the Receivables existing at the
4
<PAGE>
close of business on each Addition Cut-Off Date, in the case of Receivables
arising in the Additional Accounts, and, in each case, the Receivables
thereafter created from time to time until the termination of the Trust or until
such Account becomes a Removed Account, all monies due or to become due and all
amounts received with respect thereto (excluding, however, any and all
Recoveries) and all proceeds (including "proceeds" as defined in the UCC)
thereof (the "Purchased Assets").
(b) In connection with such Conveyance, the Account Owner agrees (i)
to record and file, at its own expense, any financing statements (and
continuation statements with respect to such financing statements when
applicable) with respect to the Receivables and other Purchased Assets 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 such Purchased Assets from the Account
Owner to the Corporation, (ii) that such financing statements shall name the
Account Owner, as seller, and the Corporation, as purchaser, of the Receivables
and other Purchased Assets and (iii) to deliver a file-stamped copy of such
financing statements or other evidence of such filings (excluding such
continuation statements, which shall be delivered as filed) to the Corporation
as soon as is practicable after filing.
(c) In connection with such Conveyance, the Account Owner further
agrees that it will, at its own expense, (i) on or prior to (x) the Initial
Closing Date, in the case of Initial Accounts, (y) the applicable Addition Date,
in the case of Additional Accounts and (z) the applicable Removal Date, in the
case of Removed Accounts, indicate in its computer files with the code "30" or
"31" or any other clearly specified code in the FDR Account Flagged field of
such computer files that, in the case of the Initial Accounts or the Additional
Accounts, Receivables created in connection with such Accounts have been
conveyed to the Corporation in accordance with this Agreement and have been
conveyed by the Corporation to the Trustee pursuant to the Pooling and Servicing
Agreement for the benefit of the Certificateholders by including (or deleting,
in the case of newly originated Receivables in Removed Accounts) in such
computer files the code identifying each such Account and (ii) deliver on or
before the Initial Closing Date, in the case of the Initial Accounts, or on or
before the Addition Date, in the case of the Additional Accounts, to the
Corporation or the Trustee, as the Corporation's nominee, a computer file or
microfiche file containing a true and complete list of all such Accounts
specifying for each such Account, as of the Initial Cut-Off Date, in the case of
Initial Accounts, the applicable Addition Cut-Off Date, in the case of
Additional Accounts, and the applicable Removal Cut-Off 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. Each such file or list, as supplemented from time to time to reflect
Additional Accounts or Removed Accounts, shall be marked as Schedule I to this
Agreement, shall be delivered to the Corporation or the Trustee, as the
Corporation's nominee, and is hereby incorporated into and made a part of this
Agreement. The Account Owner further agrees not to alter the code referenced in
clause (i) of this paragraph with respect to any Account during the term of this
Agreement unless and until such Account becomes a Removed Account or unless and
until (i) the Account Owner shall give written notice of any such alteration to
the Corporation and to the Trustee, such written notice to be as of the date of
its receipt by the Trustee incorporated
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<PAGE>
into and part of this Agreement and (ii) the Account Owner and the Corporation
shall execute and file any UCC financing statement or amendment thereof
necessitated by such alteration.
(d) The parties hereto intend that the conveyance of the Account
Owner's right, title and interest in and to the Receivables and the other
Purchased Assets shall constitute an absolute sale, conveying good title free
and clear of any liens, claims, encumbrances or rights of others from the
Account Owner to the Corporation. It is the intention of the parties hereto that
the arrangements with respect to the Receivables and other Purchased Assets
shall constitute a purchase and sale of such Receivables and not a loan. In the
event, however, that it were to be determined that the transactions evidenced
hereby constitute a loan and not a purchase and sale, it is the intention of the
parties hereto that this Agreement shall constitute a security agreement under
applicable law, and that the Account Owner shall be deemed to have granted and
does hereby grant to the Corporation a first priority perfected security
interest, in all of the Account Owner's right, title and interest, whether now
owned or hereafter acquired, in, to and under the Receivables and other
Purchased Assets to secure the rights of the Corporation hereunder and the
obligations of the Account Owner hereunder.
(e) If any Account becomes a Removed Account as provided in Section
2.10 of the Pooling and Servicing Agreement, the Account Owner, upon being
notified of the removal of such Account shall cease to sell the Receivables
arising therein to the Corporation.
Section 2.02. Addition of Additional Accounts.
(a) If, from time to time, the Corporation becomes obligated to
designate Additional Accounts (as such term is defined in the Pooling and
Servicing Agreement) pursuant to subsection 2.09(a) of the Pooling and Servicing
Agreement, then the Corporation may, at its option, give the Account Owner
written notice thereof on or before the tenth Business Day (the "Addition Notice
Date") prior to the Addition Date therefor, and upon receipt of such notice the
Account Owner shall on or before the Addition Date, designate sufficient
Eligible Accounts to be included as Additional Accounts so that after the
inclusion thereof the Corporation will be in compliance with the requirements of
said subsection 2.09(a) of the Pooling and Servicing Agreement. Additionally,
subject to subsection 2.02(b) hereof, from time to time Eligible Accounts may be
designated to be included as Additional Accounts, upon the mutual agreement of
the Corporation and the Account Owner. In either event, the Account Owner shall
have sole responsibility for selecting the Additional Accounts and shall
determine and notify the Corporation of the Addition Cut-Off Date with respect
to such Additional Accounts.
(b) On the Addition Date with respect to any designation of
Additional Accounts, the Corporation shall purchase the Account Owner's right,
title and interest in, to and under the Receivables in Additional Accounts (as
of the Addition Cut-Off Date) (and such Additional Accounts shall be deemed to
be Accounts for purposes of this Agreement), subject to the satisfaction of the
following conditions:
6
<PAGE>
i) all Additional Accounts shall be Eligible Accounts;
ii) the Account Owner shall have delivered to the Corporation copies
of UCC financing statements covering such Additional Accounts, if
necessary to perfect the Corporation's ownership of the Receivables
arising therein;
iii) to the extent required of the Corporation by Section 4.03 of
the Pooling and Servicing Agreement, the Account Owner shall have
deposited in the Collection Account all Collections with respect to such
Additional Accounts since the Addition Cut-Off Date;
iv) as of each of the Addition Cut-Off Date and the Addition Date,
no Insolvency Event with respect to the Account Owner shall have occurred
nor shall the transfer to the Corporation of the Receivables arising in
the Additional Accounts have been made in contemplation of the occurrence
thereof; and
v) the Account Owner shall have delivered to the Corporation an
Officer's Certificate, dated the Addition Date, (a) stating that, as of
the applicable Addition Cut-Off Date, the Additional Accounts are all
Eligible Accounts (b) confirming, to the extent applicable, the items set
forth in clauses (ii) through (iv) above; and (c) stating that the Account
Owner reasonably believes that the addition to the Trust of the
Receivables arising in the Additional Accounts will not based on the facts
known to such officer at the time of such addition, then or thereafter
cause an Adverse Effect to occur.
Section 2.03. Representations and Warranties. The Account Owner
hereby represents and warrants to the Corporation as of the related Addition
Date that, in the case of the Initial Accounts, the computer file or microfiche
file delivered pursuant to Section 2.01(c) hereof and marked as Schedule I to
this Agreement delivered pursuant to Section 2.01(c) hereof and, in the case of
Additional Accounts, the list delivered pursuant to Section 2.04 below is, as of
the applicable Addition Cut-Off Date, true and complete in all material
respects.
Section 2.04. Delivery of Documents. In the case of the designation
of Additional Accounts, the Account Owner shall deliver to the Corporation or
the Trustee (i) the schedule to be delivered pursuant to Section 2.01 hereof
with respect to such Additional Accounts on the date such file or list is
required to be delivered pursuant to Section 2.01 (the "Document Delivery Date")
and (ii) with respect to Additional Accounts, a duly executed written assignment
(including an acceptance by the Corporation), substantially in the form of
Exhibit A (the "Supplemental Conveyance"), on the Addition Date.
7
<PAGE>
ARTICLE III
CONSIDERATION AND PAYMENT
Section 3.01. Purchase Price.
(a) The "Purchase Price" for the Receivables in the Initial Accounts
as of the Initial Cut-Off Date conveyed to the Corporation under this Agreement
shall be payable on the Initial Closing Date and shall be an amount equal to the
balance of the Receivables in the Initial Accounts as of the Initial Cut-Off
Date, adjusted to reflect such factors as the Account Owner and the Corporation
mutually agree will result in a Purchase Price determined to be not less than
the fair market value of such Receivables. This computation of initial purchase
price should assume no reinvestment in new Receivables. The Purchase Price for
the Receivables (including Receivables in Additional Accounts) to be conveyed to
the Corporation under this Agreement which come into existence after the Initial
Cut-Off Date, shall be payable on the Distribution Date following the Monthly
Period in which such Receivables are conveyed by the Account Owner to the
Corporation in an amount equal to the balance of the Principal Receivables so
conveyed (the "New Principal Receivables"), adjusted to reflect such factors as
the Account Owner and the Corporation mutually agree will result in a Purchase
Price determined to be not less than the fair market value of such New Principal
Receivables.
(b) The Purchase Price to be paid by the Corporation on the Initial
Closing Date and on each Distribution Date following a Monthly Period during
which New Principal Receivables are conveyed to the Corporation shall be paid in
cash.
Section 3.02. Adjustments to Purchase Price. The Purchase Price
shall be adjusted on each Distribution Date (a "Credit Adjustment") with respect
to any Receivable previously conveyed to the Corporation by the Account Owner
which has since been reversed by the Account Owner or the Servicer because of a
rebate, refund, unauthorized charge or billing error to an Obligor or because
such Receivable was created in respect of merchandise which was refused or
returned or due to the occurrence of any other event referred to in Section 3.09
of the Pooling and Servicing Agreement. The amount of such adjustment shall
equal (x) the reduction in the Principal Receivables resulting from the
occurrence of such event multiplied by (y) the quotient (expressed as a
percentage) of (i) the Purchase Price for Principal Receivables payable on such
Distribution Date computed in accordance with Section 3.01 hereof divided by
(ii) the Principal Receivables paid for on such date pursuant to such Section
3.01. In the event that an adjustment pursuant to this Section 3.02 causes the
Purchase Price to be a negative number, the Account Owner agrees that, not later
than 1:00 P.M. New York City time on such Distribution Date, the Account Owner
shall pay to the Corporation an amount equal to the amount by which the Purchase
Price minus the Credit Adjustment would be reduced below zero.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.01. Representations and Warranties of the Account Owner
Relating to the Account Owner. The Account Owner hereby represents and warrants
to, and agrees with, the Corporation as of the Initial Closing Date and on each
Addition Date, that:
(a) Organization and Good Standing. The Account Owner is a state
banking corporation duly organized and validly existing in good standing under
the laws of the State of Delaware and has, in all material respects, full power
and authority to own or lease its properties and conduct its business as such
properties are presently owned or leased and such business is presently
conducted, and to execute, deliver and perform its obligations under this
Agreement.
(b) Due Qualification. The Account Owner 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 (i) render any Cardholder Agreement relating to an Account, or
any Receivable unenforceable by the Account Owner, the Servicer or the Trustee
and (ii) have a material adverse effect on the interests of the
Certificateholders.
(c) Due Authorization. The execution, delivery and performance of
this Agreement and any other document or instrument delivered pursuant hereto,
including any Supplemental Conveyance (such other documents or instruments,
collectively, the "Conveyance Papers"), and the consummation of the transactions
provided for in this Agreement and the Conveyance Papers have been (i) duly
authorized by the Account Owner by all necessary corporate action on the part of
the Account Owner and (ii) each of this Agreement and the Conveyance papers will
remain, from the time of its execution, an official record of the Account Owner.
(d) No Conflict. The execution and delivery of this Agreement and
the Conveyance Papers by the Account Owner, 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 the Account
Owner will not conflict with or result in any breach of any of the material
terms and provisions of, or constitute (with or without notice or lapse of time
or both) a material default under, any indenture, contract, agreement, mortgage,
deed of trust, or other instrument to which the Account Owner is a party or by
which it or any of its properties are bound.
(e) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of the Account Owner, threatened against the
Account Owner, before any court, regulatory body, administrative agency, or
other tribunal or governmental instrumentality (i) asserting the invalidity of
this Agreement or the Conveyance Papers, (ii) seeking to prevent the
consummation of any of the transactions contemplated by this
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Agreement or the Conveyance Papers, (iii) seeking any determination or ruling
that, in the reasonable judgment of the Account Owner, would materially and
adversely affect the performance by the Account Owner of its obligations under
this Agreement or the Conveyance Papers, (iv) seeking any determination or
ruling that, in the reasonable judgment of the Account Owner, would materially
and adversely affect the validity or enforceability of this Agreement or the
Conveyance Papers or (v) seeking to affect adversely the income tax attributes
of the Trust or any Certificates under the United States Federal or any state
income or franchise tax systems.
(f) All Consents. All approvals, authorizations, consents, orders or
other actions of any Person or of any governmental body or official required to
be obtained, effected or given by the Account Owner in connection with the
execution and delivery by the Account Owner of this Agreement and the Conveyance
Papers and the performance of the transactions contemplated by this Agreement or
the Conveyance Papers by the Account Owner have been duly obtained, effected or
given and are in full force and effect, except for approvals, authorizations,
consents, orders or other actions which if not obtained will not individually or
in the aggregate have any material adverse effect upon the ability of the
Account Owner to execute, deliver and perform under this Agreement and the
Conveyance Papers.
(g) No Insolvency Event. No Insolvency Event with respect to the
Account Owner has occurred and the transfer of the Receivables and other
Purchased Assets by the Account Owner to the Corporation as contemplated by this
Agreement has not been made in contemplation thereof.
(h) No Violation. The execution, delivery and performance of this
Agreement and the Conveyance Papers by the Account Owner and the fulfillment of
the terms contemplated herein and therein applicable to the Account Owner will
not conflict with or violate any Requirements of Law applicable to the Account
Owner.
The representations and warranties set forth in this Section 4.01
shall survive the transfer and assignment of the Receivables to the Corporation
and the transfer and assignment by the Corporation to the Trust. Upon discovery
by the Account Owner, the Corporation or the Trustee of a breach of any of the
foregoing representations and warranties, the party discovering such breach
shall give prompt written notice to the others.
Section 4.02. Representations and Warranties of the Account Owner
Relating to the Agreement and the Receivables.
(a) Representations and Warranties. The Account Owner hereby
represents and warrants to the Corporation as of the date of this Agreement, as
of the Initial Closing Date and, with respect to Additional Accounts, as of the
related Addition Date that:
(i) this Agreement and, in the case of Additional Accounts, the
related Supplemental Conveyance, each constitutes a legal, valid and
binding obligation of the Account Owner enforceable against the Account
Owner in accordance with its terms,
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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
generally from time to time in effect or general principles of equity
(whether considered in a suit of law or in equity);
(ii) as of the Initial Cut-Off Date, and as of the related Addition
Cut-Off Date with respect to Additional Accounts, Schedule I to this
Agreement (composed of the list of accounts) as supplemented to such date,
is an accurate and complete listing in all material respects of all the
Accounts the Receivables in which were transferred and the information
contained therein with respect to the identity of such Accounts and the
Receivables existing thereunder is true and correct in all material
respects as of the Initial Cut-Off Date or such applicable Addition
Cut-Off Date, as the case may be, and as of the Initial Cut-Off Date, the
aggregate amount of Receivables in all the Initial Accounts was
$216,112,004.17, of which $215,549,390.57 were Principal Receivables;
(iii) each Receivable has been conveyed to the Corporation free and
clear of any Lien;
(iv) all authorizations, consents, orders or approvals of or
registrations or declarations with any Governmental Authority required to
be obtained, effected or given by the Account Owner in connection with the
conveyance of the Receivables to the Corporation have been duly obtained,
effected or given and are in full force and effect, except for
authorizations, consents, orders or other approvals of or registrations or
declarations which if not obtained, effected or given will not
individually or in the aggregate have any material adverse effect upon the
conveyance of the Receivables to the Corporation or the ability of the
Account Owner to enter into this Agreement and the Conveyance Papers or to
perform hereunder or thereunder;
(v) this Agreement and, in the case of Additional Accounts, any
related Supplemental Conveyance constitutes a valid sale, transfer and
assignment to the Corporation of all right, title and interest of the
Account Owner in the Receivables conveyed to the Corporation by the
Account Owner and the proceeds thereof; upon the filing of the financing
statements and, in the case of Receivables hereafter created and the
proceeds thereof, upon the creation thereof, the Corporation shall have a
first priority perfected ownership interest in such property and proceeds;
(vi) on the Initial Cut-Off Date, each Initial Account is an
Eligible Account and, in the case of Additional Accounts, on the Addition
Cut-Off Date, each related Additional Account is an Eligible Account;
(vii) on the Initial Cut-Off Date, each Receivable then existing and
conveyed to the Corporation is an Eligible Receivable, and in the case of
Additional Accounts, on the applicable Addition Cut-Off Date, each
Receivable contained in such Additional Account and conveyed to the
Corporation is an Eligible Receivable;
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(viii) as of the date of the creation of any new Receivable, such
Receivable is an Eligible Receivable; and
(ix) no selection procedures believed by the Account Owner to be
materially adverse to the interests of the Corporation or the Investor
Certificateholders have been used in selecting such Accounts.
(b) Notice of Breach. The representations and warranties set forth
in this Section 4.02 shall survive the transfer and assignment of the
Receivables to the Corporation and the transfer and assignment by the
Corporation to the Trust. Upon discovery by either the Account Owner, the
Corporation, the Servicer or the Trustee of a breach of any of the
representations and warranties set forth in this Section 4.02, the party
discovering such breach shall give prompt written notice to the others. The
Account Owner hereby acknowledges that the Corporation intends to rely on the
representations hereunder in connection with representations made by the
Corporation to secured parties, assignees or subsequent transferees including
but not limited to transfers made by the Corporation to the Trust pursuant to
the Pooling and Servicing Agreement and that the Trustee may enforce such
representations directly against the Account Owner.
Section 4.03. Representations and Warranties of the Corporation. As
of the Initial Closing Date, the Corporation hereby represents and warrants to,
and agrees with, the Account Owner that:
(a) Organization and Good Standing. The Corporation is a corporation
duly organized and validly existing under the laws of the State of Delaware and
has, in all material respects, full power and authority to own or lease its
properties and conduct its business as such properties are presently owned or
leased and such business is presently conducted and to execute, deliver and
perform its obligations under this Agreement.
(b) 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 the
Corporation by all necessary corporate action on the part of the Corporation.
(c) No Conflict. The execution and delivery of this Agreement and
the Conveyance Papers by the Corporation, 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 the Account
Owner, will not conflict with, result in any breach of any of the material terms
and provisions of, or constitute (with or without notice or lapse of time or
both) a material default under, any indenture, contract, agreement, mortgage,
deed of trust or other instrument to which the Corporation is a party or by
which it or any of its properties are bound.
(d) No Violation. The execution, delivery and performance of this
Agreement and the Conveyance Papers by the Corporation and the fulfillment of
the terms
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contemplated herein and therein applicable to the Corporation will not conflict
with or violate any Requirements of Law applicable to the Corporation.
(e) No Proceedings. There are no proceedings or investigations
pending or, to the best knowledge of the Corporation, threatened against the
Corporation, before any court, regulatory body, administrative agency, or other
tribunal or governmental instrumentality (i) asserting the invalidity of this
Agreement or the Conveyance Papers, (ii) seeking to prevent the consummation of
any of the transactions contemplated by this Agreement or the Conveyance Papers,
(iii) seeking any determination or ruling that, in the reasonable judgment of
the Corporation, would materially and adversely affect the performance by the
Corporation of its obligations under this Agreement or the Conveyance Papers or
(iv) seeking any determination or ruling that, in the reasonable judgment of the
Corporation, would materially and adversely affect the validity or
enforceability of this Agreement or the Conveyance Papers.
(f) All Consents. All authorizations, consents, orders or approvals
of or registrations or declarations with any Governmental Authority required to
be obtained, effected or given by the Corporation in connection with the
execution and delivery by the Corporation of this Agreement and the Conveyance
Papers and the performance of the transactions contemplated by this Agreement
and the Conveyance Papers have been duly obtained, effected or given and are in
full force and effect; except for approvals, authorizations, consents or orders
which if not obtained will not individually or in the aggregate have any
material adverse effect upon the ability of the Corporation to execute, deliver
and perform under this Agreement and the Conveyance Papers.
The representations and warranties set forth in this Section 4.03
shall survive the conveyance of the Receivables to the Corporation and the
conveyance by the Corporation to the Trust. Upon discovery by the Corporation or
the Account Owner of a breach of any of the foregoing representations and
warranties, the party discovering such breach shall give written notice to the
other party and the Trustee within three Business Days following such discovery.
ARTICLE V
COVENANTS
Section 5.01. Covenants of the Account Owner. The Account Owner
hereby covenants and agrees with and for the benefit of the Corporation as
follows:
(a) Receivables To Be Accounts or General Intangibles. Except in
connection with its enforcement or collection of a Receivable, the Account Owner
will take no action to cause any Receivable to be evidenced by any instrument or
chattel paper (as defined in the UCC as in effect in the State of Delaware and,
if any Receivable is so evidenced, it shall be deemed to be an Ineligible
Receivable in accordance with Section 6.01(a) hereof and shall be reassigned to
the Account Owner in accordance with Section
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6.01(b) hereof; provided, however, that Receivables evidenced by notes taken
from Obligors in the ordinary course of business of the Servicer's collection
efforts shall not be deemed Ineligible Receivables solely as a result thereof.
In addition, the Account Owner agrees that tit will not take any other action to
cause any Receivable to be anything other than an "account" or a "general
intangible" (as such terms are defined in the UCC as in effect in the State of
Delaware).
(b) Security Interests. Except for the conveyance hereunder, the
Account Owner will not sell, pledge, assign or transfer to any other Person, or
take any other action inconsistent with the Corporation's ownership of the
Receivables and other Purchased Assets or grant, create, incur, assume or suffer
to exist any Lien on any Receivable or other Purchased Assets, whether now
existing or hereafter created, or any interest therein, and the Account Owner
shall not claim any ownership interest in the Receivables or in other Purchased
Assets and shall defend the right, title and interest of the Corporation in, to
and under the Receivables and other Purchased Assets, whether now existing or
hereafter created, against all claims of third parties claiming through or under
the Account Owner; provided, however, that nothing in this subsection 5.01(b)
shall prevent or be deemed to prohibit the Account Owner from suffering to exist
upon any of the Receivables transferred by it to the Corporation any Liens for
municipal or other local taxes if such taxes shall not at the time be due and
payable or if the Account Owner shall be currently contesting the validity
thereof in good faith by appropriate proceedings and shall have set aside on its
books adequate reserves with respect thereto.
(c) Account Allocations. In the event that the Account Owner is
unable for any reason to transfer Receivables to the Corporation in accordance
with the provisions of this Agreement (including, without limitation, by reason
of the application of the provisions of Section 8.02 hereof or any order of any
Governmental Authority), then, in any such event, the Account Owner agrees
(except as prohibited by any such order) to allocate and pay to the Corporation,
after the date of such inability, all amounts in the manner by which the
Corporation will allocate and pay to the Trust after such inability by the
Corporation pursuant to Section 2.11 of the Pooling and Servicing Agreement.
(d) Delivery of Collections. In the event that the Account Owner
receives Collections, the Account Owner agrees to pay to the Corporation (or to
the Servicer if the Corporation so directs) all such Collections as soon as
practicable after receipt thereof.
(e) Notice of Liens. The Account Owner shall notify the Corporation
promptly after becoming aware of any Lien on any Receivable other than the
conveyances hereunder and under the Pooling and Servicing Agreement or Liens
permitted under subsection 5.01(b) hereof.
(f) Documentation of Transfer. The Account Owner shall undertake to
file the documents which would be necessary to perfect and maintain the transfer
of the Purchased Assets to the Corporation. This Agreement and any amendments
hereto will be maintained, continuously, as an official record of the Account
Owner.
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(g) Sale. The Account Owner agrees to treat the Conveyance, for all
purposes (including all relevant tax and financial accounting purposes) as a
sale on all federal and state tax returns, financial statements and other
applicable documents.
Section 5.02. Covenants of the Account Owner with Respect to
Portfolio Yield and Cardholder Agreements. The Account Owner, hereby agrees, for
the benefit of the Corporation that:
(a) Periodic Finance Charges and Other Fees. (i) Except (x) as
otherwise required by any Requirement of Law, or (y) as is deemed by the Account
Owner to be necessary in order for it to maintain its credit card business on a
competitive basis based on a good faith assessment by it of the nature of its
competition in the credit card business, it shall not at any time reduce the
annual percentage rate of the Periodic Finance Charges assessed on the
Receivables transferred by it to the Corporation or other fees charged on any of
the Accounts if, as a result of any such reduction, either (i) the Account
Owner's reasonable expectation is that such reduction will cause a Pay Out Event
or Reimbursement Event to occur or (ii) such reduction is not also applied to
any comparable segments of consumer revolving credit card accounts owned by the
Account Owner which have characteristics the same as, or substantially similar
to, such Accounts.
(b) Cardholder Agreements and Credit Card Guidelines. The Account
Owner shall comply with and perform its obligations under the Cardholder
Agreements relating to the Accounts and the Credit Card Guidelines and all
applicable rules and regulations of MasterCard and VISA or their respective
substantial equivalents except insofar as any failure so to comply or perform
would not materially and adversely affect the rights of the Trust or the
Certificateholders under the Pooling and Servicing Agreement. Subject to
compliance with all Requirements of Law, the Account Owner may change the terms
and provisions of the Cardholder Agreements or the Credit Card Guidelines with
respect to any of the Accounts in any respect (including the calculation of the
amount or the timing, of charge-offs and the Periodic Finance Charges and other
fees to be assessed thereon) only if in the reasonable judgment of the Account
Owner such change is made applicable to any comparable segment of the consumer
revolving credit card accounts owned by the Account Owner which have
characteristics the same as, or substantially similar to, such Accounts.
(c) MasterCard and VISA. The Account Owner, to the extent applicable
to Accounts owned or serviced by it, shall use its best efforts to remain,
either directly or indirectly, a member in good standing of the MasterCard
system, the VISA system and any other similar entity's or organization's system
relating to any other type of consumer revolving credit card accounts included
as Accounts.
(d) Provide Information. The Corporation covenants that the
Corporation will provide the Account Owner with such information as the Account
Owner may reasonably request to enable the Account Owner to determine compliance
with the covenants contained in Section 5.02(a) and (b) above.
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ARTICLE VI
REPURCHASE OBLIGATION
Section 6.01. Reassignment of Ineligible Receivables.
(a) In the event (i) any representation or warranty under Section
4.02(a)(ii), (iii), (iv), (vi), (vii), (viii) or (ix) is not true and correct in
any material respect as of the date specified therein with respect to any
Receivable or the related Account or (ii) there is a breach of the covenant set
forth in Section 5.01(a) hereof and as a result of such untrue or incorrect
representation or warranty or such breach the Corporation is required to accept
reassignment of Ineligible Receivables previously sold by the Account Owner to
the Corporation pursuant to Section 2.05(a) of the Pooling and Servicing
Agreement, the Account Owner shall accept reassignment of the Corporation's
interest in such Ineligible Receivables on the terms and conditions set forth in
Section 6.01(b) hereof.
(b) the Account Owner shall accept reassignment of any Ineligible
Receivables previously sold by the Account Owner to the Corporation from the
Corporation on the date on which such reassignment obligation arises, and shall
pay for such reassigned Ineligible Receivables by paying to the Corporation, not
later than 3:00 p.m., New York City time on such date, an amount equal to the
unpaid principal balance of such Ineligible Receivables plus accrued and unpaid
finance charges at the annual percentage rate applicable to such Receivables
from the last date billed through the end of the Monthly Period in which such
reassignment obligation arises (the "Repurchase Price"). Upon reassignment of
such Ineligible Receivables, the Corporation shall automatically and without
further action be deemed to sell, transfer, assign, set-over and otherwise
convey to the Account Owner, without recourse, representation or warranty, all
the right, title and interest of the Corporation in and to such Ineligible
Receivables, all monies due or to become due with respect thereto and all
proceeds thereof; and such reassigned Ineligible Receivables shall be treated by
the Corporation as collected in full as of the date on which they were
transferred. The Corporation shall execute such documents and instruments of
transfer or assignment and take such other actions as shall reasonably be
requested by the Account Owner to effect the conveyance of such Ineligible
Receivables pursuant to this subsection.
Section 6.02. Reassignment of Receivables in Trust Portfolio. In the
event any representation or warranty set forth in Section 4.01(a) or (c) or
Section 4.02(a)(i) or (a)(v) hereof is not true and correct in any material
respect and, as a result of such breach, the Corporation is required to accept a
reassignment of the Receivables previously sold by the Account Owner to the
Corporation pursuant to Section 2.06 of the Pooling and Servicing Agreement, the
Account Owner shall be obligated to accept a reassignment of the Corporation's
interest in such Receivables on the terms set forth below.
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The Account Owner shall pay to the Corporation by depositing 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 amount specified in Section 2.06 of the Pooling and
Servicing Agreement.
ARTICLE VII
CONDITIONS PRECEDENT
Section 7.01. Conditions to the Corporation's Obligations Regarding
Initial Receivables. The obligations of the Corporation to purchase the
Receivables in the Initial Accounts on the Initial Closing Date shall be subject
to the satisfaction of the following conditions:
(a) All representations and warranties of the Account Owner
contained in this Agreement shall be true and correct on the Initial Closing
Date with the same effect as though such representations and warranties had been
made on such date;
(b) All information concerning the Initial Accounts provided to the
Corporation shall be true and correct in all material respects as of the Initial
Cut-Off Date;
(c) the Account Owner shall have (i) delivered to the Corporation a
schedule of Accounts as of the Initial Cut-Off Date and (ii) substantially
performed all other obligations required to be performed by the provisions of
this Agreement;
(d) the Account Owner shall have recorded and filed, at its expense,
any financing statement with respect to the Receivables (other than Receivables
in Additional Accounts) now existing and hereafter created for the transfer of
accounts and general intangibles (each as defined in Section 9-106 of the UCC)
meeting the requirements of applicable state law in such manner and in such
jurisdiction as would be necessary to perfect the sale of and security interest
in the Receivables and other Purchased Assets from the Account Owner to the
Corporation, and shall deliver a file-stamped copy of such financing statements
or other evidence of such filings to the Corporation;
(e) On or before the Initial Closing Date, the Corporation and the
Trustee shall have entered into the Pooling and Servicing Agreement and the
closing under the Pooling and Servicing Agreement shall take place
simultaneously with the initial closing hereunder; and
(f) All corporate and legal proceedings and all instruments in
connection with the transactions contemplated by this Agreement shall be
satisfactory in form and substance to the Corporation, and the Corporation shall
have received from the Account Owner copies of all documents (including, without
limitation, records of corporate proceedings) relevant to the transactions
herein contemplated as the Corporation may reasonably have requested.
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Section 7.02. Conditions Precedent to the Account Owner's
Obligations. The obligations of the Account Owner to sell Receivables in the
Initial Accounts on the Initial Closing Date shall be subject to the
satisfaction of the following conditions:
(a) All representations and warranties of the Corporation contained
in this Agreement shall be true and correct with the same effect as though such
representations and warranties had been made on such date;
(b) Payment or provision for payment of the Purchase Price in
accordance with the provision of Section 3.01 hereof shall have been made; and
(c) All corporate and legal proceedings and all instruments in
connection with the transactions contemplated by this Agreement shall be
satisfactory in form and substance to the Account Owner, and the Account Owner
shall have received from the Corporation copies of all documents (including,
without limitation, records of corporate proceedings) relevant to the
transactions herein contemplated as the Account Owner may reasonably have
requested.
ARTICLE VIII
TERM AND PURCHASE TERMINATION
Section 8.01. Term. This Agreement shall commence as of the date of
execution and delivery hereof and shall continue until the termination of the
Trust as provided in Article XII of the Pooling and Servicing Agreement.
Section 8.02. Purchase Termination. If the Account Owner shall fail
generally to, or admit in writing its inability to, pay its debts as they become
due; or if a proceeding shall have been instituted in a court having
jurisdiction in the premises seeking a decree or order for relief in respect of
the Account Owner 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 the Account Owner or for
any substantial part of the Account Owner's property, or for the winding-up or
liquidation of the Account Owner's affairs and, if instituted against the
Account Owner, 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 if the Account Owner shall commence a voluntary
case under any Debtor Relief Law, or if the Account Owner shall 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, or for, any substantial part of its property, or any general
assignment for the benefit of its creditors; or the Account Owner or any
subsidiary of the Account Owner shall have taken any corporate action in
furtherance of any of the foregoing actions (each an "Insolvency Event"); then
the Account Owner shall immediately cease to transfer Principal Receivables to
the Corporation and shall promptly give notice to the Corporation and the
Trustee of such Insolvency Event.
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Notwithstanding any cessation of the transfer to the Corporation of additional
Principal Receivables, Principal Receivables transferred to the Corporation
prior to the occurrence of such Insolvency Event and Collections in respect of
such Principal Receivables and Finance Charge Receivables whenever created,
accrued in respect of such Principal Receivables, shall continue to be property
of the Corporation available for transfer by the Corporation to the Trust
pursuant to the Pooling and Servicing Agreement.
ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.01. 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 the Corporation and the
Account Owner in accordance with this Section 9.01. This Agreement and any
Conveyance Papers may be amended from time to time by the Corporation and the
Account Owner (i) to cure any ambiguity, (ii) to correct or supplement any
provisions herein which may be inconsistent with any other provisions herein or
in any such other Conveyance Papers, (iii) to add any other provisions with
respect to matters or questions arising under this Agreement or any Conveyance
Papers which shall not be inconsistent with the provisions of this Agreement or
any Conveyance Papers, (iv) to change or modify the Purchase Price and (v) to
change, modify, delete or add any other obligation of the Account Owner or the
Corporation; provided, however, that no amendment pursuant to clause (iv) or (v)
of this Section 9.01 shall be effective unless the Account Owner and the
Corporation have been notified in writing that the Rating Agency Condition has
been satisfied; provided, further, that such action shall not (as evidenced by
an Opinion of Counsel delivered to the Trustee) adversely affect in any material
respect the interests of the Trustee or the Investor Certificateholders, unless
the Trustee shall consent thereto. Any reconveyance executed in accordance with
the provisions hereof shall not be considered to be an amendment to this
Agreement. A copy of any amendment to this Agreement shall be sent to each
Rating Agency.
Section 9.02. Governing Law. THIS AGREEMENT AND THE CONVEYANCE
PAPERS 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 9.03. Notices. All demands, notices and communications
hereunder shall be in writing and shall be deemed to have been duly given if
personally delivered at or mailed by registered mail, return receipt requested,
to (a) in the case of the Account Owner, The Travelers Bank USA, 100 Commerce
Drive, Newark, Delaware 19713 (telephone: 302- 454-5500), (b) in the case of the
Corporation, CC Credit Card Corporation, 100 Commerce Drive, Suite 300B, Newark,
Delaware 19713 (telephone: 302-451-6456), or (c) in the case of the Trustee, The
Bank of New York, 101 Barclay Street, 21 West, New York, New York
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10286, Attention: Corporate Trust Department--Trustee; 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 9.04. Severability of Provisions. If any one or more of the
covenants, agreements, provisions or terms of this Agreement or any Conveyance
Paper shall for any reason whatsoever be held invalid, then such covenants,
agreements, provisions, or terms shall be 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 9.05. Assignment. Notwithstanding anything to the contrary
contained herein, other than the Corporation's assignment of its rights, title,
and interests in, to, and under this Agreement to the Trustee for the benefit of
the beneficiaries of the Trust, including the Certificateholders as contemplated
by the Pooling and Servicing Agreement and Section 9.06 hereof, this Agreement
and all other Conveyance Papers may not be assigned by the parties hereto;
provided, however, that the Account Owner shall have the right to assign its
rights, title and interests, in to and under this Agreement to (i) any successor
by merger assuming this Agreement (ii) to any affiliate owned directly or
indirectly by Commercial Credit Company which assumes the obligations of this
Agreement or (iii) to any entity provided that the Rating Agency Condition has
been satisfied.
Section 9.06. Acknowledgement and Agreement of the Account Owner. By
execution below, the Account Owner expressly acknowledges and agrees that all of
the Corporation's right, title, and interest in, to, and under this Agreement,
including, without limitation, all of the Account Owner's right, title, and
interest in and to the Receivables and other Purchased Assets purchased pursuant
to this Agreement, shall be assigned by the Corporation to the Trustee for the
benefit of the beneficiaries of the Trust, including the Certificateholders, and
the Corporation consents to such assignment. The Account Owner further agrees
that notwithstanding any claim, counterclaim, right of setoff or defense which
it may have against the Corporation, due to a breach by the Corporation of this
Agreement or for any other reason, and notwithstanding the bankruptcy of the
Corporation or any other event whatsoever, the Account Owner's sole remedy shall
be a claim against the Corporation for money damages and, then only to the
extent of funds received by the Corporation pursuant to the Pooling and
Servicing Agreement, and in no event shall the Corporation assert any claim on
or any interest in the Receivables and other Purchased Assets or any proceeds
thereof or take any action which would reduce or delay receipt by
Certificateholders of collections with respect to the Receivables and other
Purchased Assets. Additionally, the Account Owner agrees for the benefit of the
Trustee that any amounts payable by the Account Owner to the Corporation
hereunder which are to be paid by the Corporation to the Trustee for the benefit
of the Certificateholders shall be paid by the Corporation, on behalf of the
Corporation, directly to the Trustee.
Section 9.07. Further Assurances. The Account Owner and the
Corporation agree to do and perform, from time to time, any and all acts and to
execute any and all further instruments required or reasonably requested by the
other party or the Trustee more fully to effect the purposes of this Agreement,
the Conveyance Papers and the Pooling and
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Servicing Agreement, including, without limitation, the execution of any
financing statements or continuation statements or equivalent documents relating
to the Receivables and other Purchased Assets for filing under the provisions of
the UCC or other law of any applicable jurisdiction.
Section 9.08. No Waiver; Cumulative Remedies. No failure to exercise
and no delay in exercising, on the part of the Corporation or the Account Owner,
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. Subject to Section
9.06, the rights, remedies, powers and privileges herein provided are cumulative
and not exhaustive of any rights, remedies, powers and privileges provided by
law.
Section 9.09. 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 9.10. 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
Trustee shall be considered a third-party beneficiary of this Agreement.
Section 9.11. Merger and Integration. Except as specifically stated
otherwise herein, this Agreement and the Conveyance Papers set forth the entire
understanding of the parties relating to the subject matter hereof, and all
prior understandings, written or oral, are superseded by this Agreement and the
Conveyance Papers. This Agreement and the Conveyance Papers may not be modified,
amended, waived or supplemented except as provided herein.
Section 9.12. Headings. The headings are for purposes of reference
only and shall not otherwise affect the meaning or interpretation of any
provision hereof.
Section 9.13. Schedules and Exhibits. The schedules and exhibits
attached hereto and referred to herein shall constitute a part of this Agreement
and are incorporated into this Agreement for all purposes.
Section 9.14. Survival of Representations and Warranties. All
representations, warranties and agreements contained in this Agreement or
contained in any Supplemental Conveyance, shall remain operative and in full
force and effect and shall survive conveyance of the Receivables by the
Corporation to the Trust pursuant to the Pooling and Servicing Agreement.
Section 9.15. Nonpetition Covenant. Notwithstanding any prior
termination of this Agreement, the Account Owner shall not, prior to the date
which is one year and one
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day after the termination of this Agreement, acquiesce, petition or otherwise
invoke or cause the Corporation to invoke the process of any Governmental
Authority for the purpose of commencing or sustaining a case against the
Corporation 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 Corporation or any substantial part of its
property or ordering the winding-up or liquidation of the affairs of the
Corporation.
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IN WITNESS WHEREOF, the Corporation and the Account Owner have
caused this Receivables Transfer Agreement to be duly executed by their
respective officers as of the day and year first above written.
TRAVELERS BANK & TRUST, fsb,
as Account Owner
By: /s/ Charles Haug
-------------------------
Name: Charles Haug
Title: SVP & CFO
CC CREDIT CARD CORPORATION,
as Corporation
By: /s/ Barbara Yastine
-------------------------
Name: Barbara Yastine
Title: President
[Signature Page to Receivables Transfer Agreement]
<PAGE>
EXHIBIT A
FORM OF SUPPLEMENTAL CONVEYANCE
(As required by Section 2.04 of
the Receivables Transfer Agreement)
SUPPLEMENTAL CONVEYANCE No. dated as of , 19 , by and between THE
TRAVELERS BANK USA, as Account Owner ("the Account Owner"), and CC CREDIT CARD
CORPORATION as Corporation (the "Corporation"), pursuant to the Receivables
Transfer Agreement referred to below.
WITNESSETH:
WHEREAS, the Corporation and the Account Owner are parties to a
Receivables Transfer Agreement, dated as of March 1, 1998 (hereinafter as such
agreement may have been, or may from time to time be, amended, supplemented or
otherwise modified, the "Receivables Transfer Agreement");
WHEREAS, pursuant to the Receivables Transfer Agreement, the
Corporation wishes to designate Additional Accounts to be included as Accounts
and the Account Owner wishes to convey its right, title and interest in the
Receivables of such Additional Accounts, whether now existing or hereafter
created, to the Corporation pursuant to the Receivables Transfer Agreement (as
each such term is defined in the Receivables Transfer Agreement); and
WHEREAS, the Corporation is willing to accept such designation and
conveyance subject to the terms and conditions hereof.
NOW, THEREFORE, the Corporation and the Account Owner hereby agree
as follows:
1. Defined Terms. All capitalized terms used herein shall have the
meanings ascribed to them in the Receivables Transfer Agreement unless otherwise
defined herein.
"Addition Date" shall mean, with respect to the Additional Accounts
designated hereby, ________________, 19__.
"Addition Cut-Off Date" shall mean, with respect to the Additional
Accounts designated hereby, _________ __, 19__.
2. Designation of Additional Accounts. The Account Owner delivers
herewith a computer file or microfiche list containing a true and complete
schedule
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identifying all such Additional Accounts and 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 in
such Account. Such computer file, microfiche list or other documentation (each
an "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) The Account Owner does hereby sell, transfer, assign, set over
and otherwise convey to the Corporation, without recourse except as provided in
the Receivables Transfer Agreement, all its right, title and interest in, to and
under the Receivables generated by such Additional Accounts, existing at the
close of business on the Addition Cut-Off Date and thereafter created until
termination of the Receivables Transfer Agreement, all monies due or to become
due and all amounts received with respect thereto and all "proceeds" (including,
without limitation, "proceeds" as defined in Article 9 of the UCC) thereof (but
not including the right to receive Recoveries with respect to such Receivables).
(b) In connection with such sale, the Account Owner agrees to record
and file, at its own expense, one or more financing statements (and continuation
statements with respect to such financing statements when applicable) with
respect to the Receivables now existing and hereafter created, for the transfer
of accounts and general intangibles meeting the requirements of applicable state
law in such manner and in such jurisdictions as are necessary to perfect the
sale and assignment of and the security interest in the Receivables to the
Corporation, and to deliver a file-stamped copy of such financing statement or
other evidence of such filing to the Corporation.
(c) In connection with such sale, the Account Owner further agrees,
at its own expense, on or prior to the date of this Supplemental Conveyance, (i)
to indicate in its computer files with the code _____ or _____ or any other
clearly specified code in the FDR Account Flagged field of such computer files
that the Receivables created in connection with such Additional Accounts have
been conveyed to the Corporation in accordance with the Receivables Transfer
Agreement and this Supplemental Conveyance and have been conveyed by the
Corporation to the Trustee pursuant to the Pooling and Servicing Agreement for
the benefit of the Certificateholders by including in such computer files the
code identifying each such Account and (ii) to deliver to the Corporation or the
Trustee, as the Corporation's nominee, a computer file or microfiche list
containing a true and complete list of all Receivables created in connection
with the Additional Accounts designated hereby which have been conveyed to the
Corporation pursuant to this Supplemental Conveyance.
4. Acceptance by the Corporation. The Corporation hereby
acknowledges its acceptance of all right, title and interest to the property,
now existing and hereafter created, conveyed to the Corporation pursuant to
Section 3(a) of this Supplemental Conveyance, and declares that it shall
maintain such right, title and interest. The Corporation further acknowledges
that, prior to or simultaneously with the execution and delivery of this
Supplemental Conveyance, the Account Owner delivered to the Corporation the
computer file or microfiche list described in Section 2 of this Supplemental
Conveyance.
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5. Representations and Warranties of the Account Owner. The Account
Owner hereby represents and warrants to the Corporation as of the date of this
Supplemental Conveyance and as of the Addition Date that:
(a) Legal, Valid and Binding Obligation. This Supplemental
Conveyance constitutes a legal, valid and binding obligation of the Account
Owner enforceable against the Account Owner in accordance with its terms, except
as such enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally from time to time in effect or general principles of equity;
(b) Eligibility of Accounts. On the Addition Cut-Off Date, each
Additional Account designated hereby is an Eligible Account;
(c) No Liens. Each Receivable in an Additional Account designated
hereby has been conveyed to the Corporation free and clear of any Lien;
(d) Eligibility of Receivables. On the Addition Cut-Off Date, each
Receivable existing in an Additional Account designated hereby is an Eligible
Receivable and as of the date of creation of any Receivable in an Additional
Account designated hereby, such Receivable is an Eligible Receivable;
(e) Selection Procedures. No selection procedure believed by the
Account Owner to be adverse to the interests of the Corporation or the Investor
Certificateholders was utilized in selecting the Additional Accounts;
(f) Transfer of Receivables. This Supplemental Conveyance
constitutes a valid sale, transfer and assignment to the Corporation of all
right, title and interest of the Account Owner in the Receivables arising in the
Additional Accounts designated hereby now existing or hereafter created, all
monies due or to become due, all amounts received with respect thereto, the
"proceeds" (including, without limitation, "proceeds" as defined in Article 9 of
the UCC) thereof and the Recoveries with respect thereto;
(g) No Conflict. The execution and delivery of this Supplemental
Conveyance, the performance of the transactions contemplated by this
Supplemental Conveyance and the fulfillment of the terms hereof, will not
conflict with, result in any breach of any of the material terms and provisions
of, or constitute (with or without notice or lapse of time or both) a material
default under, any indenture, contract, agreement, mortgage, deed of trust or
other instrument to which the Account Owner is a party or by which it or its
properties are bound;
(h) No Violation. The execution and delivery of this Supplemental
Conveyance by the Account Owner, the performance of the transactions
contemplated by this Supplemental Conveyance and the fulfillment of the terms
hereof applicable to the Account Owner will not conflict with or violate any
Requirements of Law applicable to the Account Owner;
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(i) No Proceedings. There are no proceedings or investigations,
pending or, to the best knowledge of the Account Owner, threatened against the
Account Owner before any Governmental Authority (i) asserting the invalidity of
this Supplemental Conveyance, (ii) seeking to prevent the consummation of any of
the transactions contemplated by this Supplemental Conveyance, (iii) seeking any
determination or ruling that, in the reasonable judgment of the Account Owner,
would materially and adversely affect the performance by the Account Owner of
its obligations under this Supplemental Conveyance or (iv) seeking any
determination or ruling that would materially and adversely affect the validity
or enforceability of this Supplemental Conveyance; and
(j) All Consents. All authorizations, consents, orders or approvals
of any court or other governmental authority required to be obtained by the
Account Owner in connection with the execution and delivery of this Supplemental
Conveyance by the Account Owner and the performance of the transactions
contemplated by this Supplemental Conveyance by the Account Owner, have been
obtained, except for authorizations, consents, orders or approvals which, if not
obtained, will not individually or in the aggregate have any material adverse
effect upon the conveyance of the Receivables to the Corporation or the ability
of the Account Owner to execute and deliver this Supplemental Conveyance or to
perform the transactions contemplated hereby.
6. Ratification of the Receivables Transfer Agreement. The
Receivables Transfer Agreement is hereby ratified, and all references to the
"Receivables Transfer Agreement," to "this Agreement" and "herein" shall be
deemed from and after the Addition Date to be a reference to the Receivables
Transfer Agreement as supplemented by this Supplemental Conveyance. Except as
expressly amended hereby, all the representations, warranties, terms, covenants
and conditions of the Receivables Transfer 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 Transfer Agreement.
7. Counterparts. This Supplemental Conveyance may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument.
8. Governing Law. This Supplemental Conveyance shall be construed in
accordance with the laws of the State of Delaware, without reference to its
conflict of law provisions, and the obligations, rights and remedies of the
parties hereunder shall be determined is accordance with such laws.
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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.
CC CREDIT CARD CORPORATION
By: __________________________________
Name:_____________________________
Title:____________________________
THE TRAVELERS BANK USA
By: __________________________________
Name:_____________________________
Title:____________________________
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Schedule I to
Supplemental
Conveyance
Additional Accounts
A-6
<PAGE>
Schedule I
to Receivables
Transfer Agreement
LIST OF ACCOUNTS
DEEMED INCORPORATED BY REFERENCE
