DISCOVER CARD EXECUTION NOTE TRUST Grantor Secured Party and Securities Intermediary COLLATERAL ACCOUNT CONTROL AGREEMENT Dated as of July 26, 2007
Exhibit 10.1
Execution Copy
DISCOVER CARD EXECUTION NOTE TRUST
Grantor
U.S. BANK NATIONAL ASSOCIATION
Secured Party
and
U.S. BANK NATIONAL ASSOCIATION
Securities Intermediary
Dated as of July 26, 2007
This Collateral Account Control Agreement, dated as of July 26, 2007 (this “Agreement”), among
DISCOVER CARD EXECUTION NOTE TRUST, a statutory trust created under the laws of the State of
Delaware (the “Grantor”), U.S. BANK NATIONAL ASSOCIATION, a national banking association organized
and existing under the laws of the United States of America, in its capacity as Indenture Trustee
(the “Secured Party”), and U.S. BANK NATIONAL ASSOCIATION, in its capacity as a “securities
intermediary” (as defined in Section 8-102 of the UCC) and a “bank” (as defined in Section 9-102 of
the UCC) (in such capacities, the “Securities Intermediary”). Capitalized terms used but not
defined herein shall have the meanings set forth in the Indenture, dated as of July 26, 2007 (the
“Indenture”) and the Indenture Supplement for the DiscoverSeries Notes, dated as of July 26, 2007,
in each case between the Grantor and the Secured Party. All references herein to the “UCC” shall
mean the Uniform Commercial Code as in effect in the State of New York from time to time.
WHEREAS, the Grantor has granted to the Secured Party a first priority security interest in
the Pledged Accounts (defined below) pursuant to the Indenture;
WHEREAS, the parties hereto are entering into this Agreement to perfect and ensure the
priority of such security interest;
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
Section 1. Establishment and Maintenance of Collateral Accounts.
(a) The Grantor has directed the Securities Intermediary to establish, and the Securities
Intermediary hereby does establish, the Collections Account and Issuer Accounts (in each case as
defined in the Indenture,) which are listed on Schedule 1 hereto (such accounts including each
subaccount thereof and each successor account thereto, collectively, the “Pledged Accounts”) each
to be maintained by the Securities Intermediary as a security intermediary in the name of the
Secured Party and for which the Secured Party is the customer of the Securities Intermediary, to
hold the funds deposited therein, in the case of the Collections Account, for the benefit of the
Secured Party and the Noteholders, and in the case of the Issuer Accounts, for the benefit of the
Secured Party and the applicable Noteholders. The Securities Intermediary covenants and agrees
that it shall not change the name or account number of any Pledged Account without the prior
written consent of the Secured Party. Schedule I hereto may be amended or supplemented from time to
time by written agreement of the parties, and from the date of any such amendment or supplement
each account listed thereon (including each subaccount thereof and each successor account thereto)
shall also be a Pledged Account hereunder.
(b) Each of the parties hereto acknowledges and agrees that the Pledged Accounts are intended
to be “securities accounts” (as defined in Section 8-501 of the UCC).
(c) The Securities Intermediary covenants and agrees that: (i) all securities or other
property underlying any financial assets credited to any Securities Account shall be registered in
the name of the Securities Intermediary, indorsed to the Securities Intermediary or indorsed in
blank or credited to another securities account maintained in the name of the Securities
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Intermediary; (ii) in no case will any financial asset credited to any Securities Account be
registered in the name of the Grantor, payable to the order of the Grantor or specially indorsed to
the Grantor except to the extent the foregoing have been specially indorsed to the Securities
Intermediary or indorsed in blank; and (iii) all property delivered to the Securities Intermediary
pursuant to the Indenture shall be promptly credited to one of the Pledged Accounts.
Section 2. “Financial Assets” Election. The Securities Intermediary hereby agrees that each
item of property (including, without limitation, all Permitted Investments and any investment
property, financial asset, security, instrument or cash) credited to any Pledged Account shall be
treated as a “financial asset” within the meaning of Section 8-102(a)(9) of the UCC.
Section 3. Secured Party’s Control of the Pledged Accounts. If at any time the Securities
Intermediary shall receive from the Secured Party an entitlement order (i.e., an order directing
transfer or redemption of any financial asset relating to a Pledged Account) or instruction
(including, without limitation instructions with respect to disposition of funds in the accounts),
the Securities Intermediary shall comply with such entitlement order or instruction without further
consent by the Grantor or any other Person. If the Grantor is otherwise entitled to give any
entitlement orders or instructions with respect to the Pledged Account in accordance with Section 4
hereof and such entitlement orders or instructions conflict with instructions of the Secured Party,
the Securities Intermediary shall comply with the entitlement orders and instructions issued by the
Secured Party.
Section 4. Grantor’s Access to the Account. If at any time the Secured Party delivers to the
Securities Intermediary a notice of sole control in substantially the form set forth in Exhibit A
hereto (a “Notice of Sole Control”), the Securities Intermediary agrees that after receipt of such
notice, it will take all directions with respect to the Pledged Accounts solely from the Secured
Party and shall not comply with instructions or entitlement orders of the Grantor or any other
Person.
Section 5. Subordination of Lien; Waiver of Set-Off. In the event that the Securities
Intermediary has or subsequently obtains by agreement, by operation of law or otherwise a security
interest in any Pledged Account or any financial assets, cash or other property credited thereto,
the Securities Intermediary hereby agrees that such security interest shall be subordinate to the
security interest of the Secured Party. The financial assets, money and other items credited to
any Pledged Account will not be subject to deduction, set-off, banker’s lien, or any other right in
favor of any Person other than the Secured Party (except that the Securities Intermediary may
set-off the face amount of any checks which have been credited to such Pledged Account but are
subsequently returned unpaid because of uncollected or insufficient funds).
Section 6. Choice of Law.
This Agreement shall be governed by the laws of the State of New York. Regardless of any
provision in any other agreement, for purposes of the UCC, with respect to each Pledged Account,
New York shall be deemed to be the securities intermediary’s “jurisdiction” (within the meaning of
Sections 8-110 and 9-304 of the UCC). The Pledged Accounts shall be governed by the laws of the
State of New York.
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Section 7. Conflict with Other Agreements. In the event of any conflict between this
Agreement (or any portion thereof) and any other agreement now existing or hereafter entered into,
the terms of this Agreement shall prevail.
Section 8. Security Intermediary’s Representations and Warranties; Covenants. The Securities
Intermediary hereby represents, warrants, covenants and agrees that:
(a) There are no other agreements entered into between the Securities Intermediary and the
Grantor with respect to any Pledged Account.
(b) It has not entered into, and until the termination of this Agreement will not enter into,
any agreement with any other Person relating to the Pledged Accounts and/or any financial assets
credited thereto pursuant to which it agrees or has agreed to comply with “entitlement orders” (as
defined in Section 8-102(a)(8) of the UCC) of such other Person.
(c) It has not entered into, and until the termination of this Agreement will not enter into,
any agreement with the Grantor or the Secured Party purporting to limit or condition the obligation
of the Securities Intermediary to comply with entitlement orders or instructions.
(d) The Pledged Accounts have been established as set forth in Section 1 of this Agreement and
will be maintained in the manner set forth herein until the termination of this Agreement.
(e) The Securities Intermediary represents and warrants that this Agreement is the legal,
valid, binding and enforceable obligation of the Securities Intermediary, enforceable against it in
accordance with its terms, subject to (x) the effect of bankruptcy, insolvency, or similar laws
affecting generally the enforcement of creditor’s rights and (y) general equitable principles.
Section 9. Adverse Claims. The Securities Intermediary represents and warrants that, except
for the claims and interest of the Secured Party and of the Grantor in the Pledged Accounts, it has
no actual knowledge of any security interest in, lien on or claim to, or other interest in, any
Pledged Account or in any “financial asset” (as defined in Section 8-102(a) of the UCC) credited
thereto. If an officer of the Securities Intermediary receives written notice that any Person
asserts any lien, encumbrance or adverse claim (including any writ, garnishment, judgment, warrant
of attachment, execution or similar process) against the Pledged Accounts or in any financial asset
carried therein known to the Securities Intermediary, the Securities Intermediary will
promptly notify the Secured Party and the Grantor thereof.
Section 10. Indemnification of Securities Intermediary.
(a) The Grantor and the Secured Party hereby agree that (x) the Securities Intermediary is
released from any and all liabilities to the Grantor and the Secured Party arising from the terms
of this Agreement and the compliance of the Securities Intermediary with the terms hereof, except
to the extent that such liabilities arise from the Securities Intermediary’s bad faith, willful
misconduct or negligence and (y) the Grantor, its successors and assigns shall at all times
indemnify and save harmless the Securities Intermediary from and against any loss, liability or
expense incurred without bad faith, willful misconduct or negligence on the part of
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the Securities
Intermediary, its officers, directors and agents, arising out of or in connection with the
execution and performance of this Agreement or the maintenance of the Pledged Accounts, including
the reasonable costs and expenses of defending themselves against any claim or liability in
connection with the exercise or performance of any of their powers or duties hereunder.
Anything in this Agreement notwithstanding, in no event shall the Securities Intermediary or
Secured Party be liable for special, indirect, or consequential loss or damage of any kind
whatsoever (including, but not limited to, lost profits), even if the Securities Intermediary or
the Secured Party has been advised of such loss or damage and regardless of the form of action.
The provisions of this Section shall survive termination of this Agreement and the resignation or
removal of the Securities Intermediary for any reason.
(b) This Agreement shall not subject the Securities Intermediary to any duty, obligation or
liability except as is expressly set forth herein and the Securities Intermediary shall satisfy
those duties expressly set forth in this Agreement so long as it acts without negligence, willful
default or fraud. In particular (without implied limitation), the Securities Intermediary need not
investigate whether the Secured Party is entitled to give any entitlement order, Notice of Sole
Control or any other directions, instructions or other orders in any instance. Without limiting
the generality of the foregoing, the Securities Intermediary shall not be subject to any fiduciary
or other implied duties, and the Securities Intermediary shall not have any duty to take any
discretionary action or exercise any discretionary powers.
Section 11. Successors; Assignment. The terms of this Agreement shall be binding upon, and
shall inure to the benefit of, the parties hereto and their respective corporate successors and
assigns, except that neither the Grantor nor the Securities Intermediary may delegate their
obligations hereunder without the prior written consent of the Secured Party. The Secured Party
agrees to send written notice to the Securities Intermediary and Standard & Poor’s of any such
delegation.
Section 12. Notices.
(a) Any notice, request or other communication required or permitted to be given under this
Agreement shall be in writing and deemed to have been properly given when delivered in Person, or
when sent by telecopy, electronic mail, or other electronic means and electronic confirmation of
error free receipt is received or two (2) Business Days after being sent by certified or registered
United States mail, return receipt requested, postage prepaid, addressed to the party at the
address set forth below.
Grantor:
Discover Card Execution Note Trust
c/o Wilmington Trust Company
Xxxxxx Square North, 0000 X. Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Fax: 000-000-0000
Email: xxxxx@xxxxxxxxxxxxxxx.xxx
c/o Wilmington Trust Company
Xxxxxx Square North, 0000 X. Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Corporate Trust Administration
Fax: 000-000-0000
Email: xxxxx@xxxxxxxxxxxxxxx.xxx
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with copies to:
Xxxxxxxx, Xxxxxx & Finger, P.A.
One Xxxxxx Square
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxx
Fax: (000) 000-0000
Email: xxxxx@xxx.xxx, and
One Xxxxxx Square
000 Xxxxx Xxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxxx Xxxxx
Fax: (000) 000-0000
Email: xxxxx@xxx.xxx, and
Xxxxxx & Xxxxxxx XXX
Xxxxx Xxxxx, Xxxxx 0000
000 Xxxxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxx
Fax: (000) 000-0000
Email: xxxxx.xxxxx@xx.xxx
Xxxxx Xxxxx, Xxxxx 0000
000 Xxxxx Xxxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: Xxxxx Xxxxx
Fax: (000) 000-0000
Email: xxxxx.xxxxx@xx.xxx
Secured Party:
U.S. Bank National Association
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: Corporate Trust Services
Fax: 000-000-0000
Email: XXXXXXXX.XXXXX@xxxxxx.xxx
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: Corporate Trust Services
Fax: 000-000-0000
Email: XXXXXXXX.XXXXX@xxxxxx.xxx
Securities Intermediary:
U.S. Bank National Association
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: Corporate Trust Services
Fax: 000-000-0000
Email: XXXXXXXX.XXXXX@xxxxxx.xxx
000 Xxxxx XxXxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
Attention: Corporate Trust Services
Fax: 000-000-0000
Email: XXXXXXXX.XXXXX@xxxxxx.xxx
(b) Any party may change its address for notices by giving notice to the other parties hereto
in the manner set forth above.
Section 13. Bankruptcy, Non-Petition and Limited Recourse. Notwithstanding any other
provision of this Agreement, each of the Secured Party and the Securities Intermediary agrees that
it will not at any time institute against the Issuer, any Master Trust or any special purpose
entity that acts as a depositor with respect to any Master Trust or the Issuer, or join in any
institution against the Issuer, any Master Trust or any special purpose entity that acts as a
depositor with respect to any Master Trust or the Issuer of, any receivership, insolvency,
bankruptcy or other similar proceedings, or other proceedings under any United States federal or
state bankruptcy or similar law in connection with any obligations relating to the Notes, the
Indenture, any Derivative Agreement, any Supplemental Credit Enhancement Agreement, any
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Supplemental Liquidity Agreement, any Collateral Certificate (including the Series 2007-CC
Collateral Certificate), any Pooling and Servicing Agreement (including the DCMT Pooling and
Servicing Agreement) and any Series Supplement. Notwithstanding any other provision of this
Agreement, the obligations of the Grantor hereunder, if any, shall be limited to amounts available
from the Collateral and following their application in accordance with the Indenture, any
outstanding obligations of or claims against the Company hereunder shall be extinguished. The
provisions of this Section 13 shall survive any termination of this Agreement.
Section 14. Amendment. No amendment or modification of this Agreement or waiver of any right
hereunder shall be binding on any party hereto unless it is in writing and is signed by each of the
Grantor, the Secured Party and the Securities Intermediary.
Section 15. Termination. The obligations of the Securities Intermediary to the Secured Party
pursuant to this Agreement shall continue in effect until the security interests of the Secured
Party in each of the Pledged Accounts have been terminated pursuant to the terms of the Indenture
and the Secured Party has notified the Securities Intermediary of such termination in writing. The
Secured Party agrees to provide Notice of Termination in substantially the form of Exhibit
B hereto to the Securities Intermediary upon the request of the Grantor on or after the
termination of the Secured Party’s security interest in the Pledged Accounts pursuant to the terms
of the Indenture. The termination of this Agreement shall not terminate the Pledged Accounts or
alter the obligations of the Securities Intermediary to the Grantor pursuant to any other agreement
with respect to the Pledged Accounts.
Section 16. Counterparts. This Agreement may be executed in any number of counterparts, all of which shall constitute
one and the same instrument, and any party hereto may execute this Agreement by signing and
delivering one or more counterparts.
[Remainder of page intentionally blank; signature page follows]
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| DISCOVER CARD EXECUTION NOTE TRUST, as the Grantor |
||||||
| By: | Wilmington Trust Company, | |||||
| not in its individual capacity but solely as Owner Trustee |
||||||
| By: | /s/ Xxxxxxxx X. Xxxx | |||||
| Name: Xxxxxxxx X. Xxxx | ||||||
| Title: Sr. Financial Services Officer | ||||||
| U.S. BANK NATIONAL ASSOCIATION,
as the Indenture Trustee |
||||||
| By: | /s/ Xxxxxxxx X. Child | |||||
| Name: Xxxxxxxx X. Child | ||||||
| Title: Vice President | ||||||
| U.S. BANK NATIONAL ASSOCIATION, | ||||||
| as the Securities Intermediary | ||||||
| By: | /s/ Xxxxxxxx X. Child | |||||
| Name: Xxxxxxxx X. Child | ||||||
| Title: Vice President | ||||||
Signature Page to the Collateral Account Control Agreement
for Discover Card Execution Note Trust
for Discover Card Execution Note Trust
SCHEDULE 1
| Exact Name of Account | Account Number | ||
Collections Account |
|||
Collections Account —
U.S. Bank National Association as Indenture
Trustee for the benefit of the Indenture Trustee
and the Noteholders
|
Account No.: 117493000 | ||
Issuer Accounts |
|||
DiscoverSeries Collections Account —
U.S. Bank National Association as Indenture
Trustee for the benefit of the Indenture Trustee
and the DiscoverSeries Noteholders
|
Account No.: 117427000 | ||
DiscoverSeries Interest Funding Account —
U.S. Bank National Association as Indenture
Trustee for the benefit of the Indenture Trustee
and the DiscoverSeries Noteholders
|
Account No.: 117428000 | ||
DiscoverSeries Principal Funding Account —
U.S. Bank National Association as Indenture
Trustee for the benefit of the Indenture Trustee
and the DiscoverSeries Noteholders
|
Account No.: 117429000 | ||
DiscoverSeries Accumulation Reserve Account —
U.S. Bank National Association as Indenture
Trustee for the benefit of the indenture Trustee
and the DiscoverSeries Noteholders
|
Account No.: 117430000 | ||
DiscoverSeries Class C Reserve Account —
U.S. Bank National Association as Indenture
Trustee for the benefit of the Indenture Trustee
and the DiscoverSeries Noteholders
|
Account No.: 117431000 | ||
DiscoverSeries Class D Reserve Account —
U.S. Bank National Association as Indenture
Trustee for the benefit of the Indenture Trustee
and the DiscoverSeries Noteholders
|
Account No.: 117432000 | ||
Exhibit A
[ Date ]
U.S. Bank National Association, as Securities Intermediary
[ ]
[ ]
Attention: [ ]
Re: Notice of Sole Control
Ladies and Gentlemen:
As referenced in the Collateral Account Control Agreement, dated July 26, 2007, among Discover
Card Execution Note Trust, you and the undersigned, we hereby give you notice of our sole control
over each of the Pledged Accounts and all financial assets or funds credited thereto. You are
hereby instructed not to accept any entitlement orders with respect to the Pledged Accounts or the
financial assets or funds credited thereto from any Person other than the undersigned, unless
otherwise ordered by a court of competent jurisdiction or otherwise directed by us in writing.
You are instructed to deliver a copy of this notice by mail, facsimile transmission or
electronic mail to Discover Card Execution Note Trust.
| Very truly yours, | ||||||
| U.S. Bank National Association, | ||||||
| as Indenture Trustee and Secured Party | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
cc: Discover Card Execution Note Trust
Exhibit B
[ Date ]
U.S. Bank National Association, as Securities Intermediary
[ ]
[ ]
Attention: [ ]
Re: Termination of Collateral Account Control Agreement
You are hereby notified that the Collateral Account Control Agreement dated July 26, 2007,
among Discover Card Execution Note Trust, you and the undersigned is terminated and you have no
further obligations to the undersigned pursuant to such Agreement. Notwithstanding any previous
instructions to you, you are hereby instructed to accept all future directions with respect to
account number(s) [ ] from Discover Card Execution Note Trust or its agent. This notice
terminates any obligations you may have to the undersigned with respect to such account, however
nothing contained in this notice shall alter any obligations which you may otherwise owe to
Discover Card Execution Note Trust pursuant to any other agreement.
You are instructed to deliver a copy of this notice by mail, facsimile transmission or
electronic mail to Discover Card Execution Note Trust.
| Very truly yours, | ||||||
| U.S. Bank National Association, | ||||||
| as Indenture Trustee and Secured Party | ||||||
| By: | ||||||
| Name: | ||||||
| Title: | ||||||
