Exhibit 10.4
[***] TEXT OMITTED AND FILED SEPARATELY
CONFIDENTIAL TREATMENT REQUESTED
SECOND AMENDMENT
TO
INDENTURE AND SERVICING AGREEMENT
(Midland Receivables-Backed Notes, Series 1999-1)
--------------------------------------------------------
MIDLAND RECEIVABLES 99-1 CORPORATION,
as Issuer
and
MIDLAND CREDIT MANAGEMENT, INC.,
as Servicer
XXXXX FARGO BANK MINNESOTA, NATIONAL ASSOCIATION,
as Trustee and Backup Servicer
and
RADIAN ASSET ASSURANCE INC.,
as Note Insurer
and
PFL LIFE INSURANCE COMPANY,
LIFE INVESTORS INSURANCE COMPANY OF AMERICA,
RELIANCE STANDARD LIFE INSURANCE COMPANY,
and
NM ROTHSCHILD & SONS (AUSTRALIA) LIMITED,
as Noteholders
Dated as of September 30, 2002
--------------------------------------------------------
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
SECOND AMENDMENT
TO
INDENTURE AND SERVICING AGREEMENT
(Midland Receivables-Backed Notes, Series 1999-1)
This Second Amendment to Indenture and Servicing Agreement, dated as of
September 30, 2002 (this "Second Amendment"), is executed by and among Midland
Receivables 99-1 Corporation, as issuer (the "Issuer"), Xxxxx Fargo Bank
Minnesota, National Association (formerly known as Norwest Bank Minnesota,
National Association), as trustee (in such capacity, the "Trustee"), and as
backup Servicer (in such capacity, the "Backup Servicer"), Midland Credit
Management, Inc., as servicer (the "Servicer"), Radian Asset Assurance Inc.
(formerly known as Asset Guaranty Insurance Company), as note insurer (the "Note
Insurer") and PFL Life Insurance Company, Life Investors Insurance Company of
America, Reliance Standard Life Insurance Company, and NM Rothschild & Sons
(Australia) Limited, as noteholders (collectively, the "Noteholders").
Capitalized terms used and not otherwise defined herein shall have the meanings
assigned to such terms in the Indenture and Servicing Agreement (as defined
below).
RECITALS
WHEREAS, the Issuer, the Trustee, the Backup Servicer, the Servicer and the
Note Insurer are parties to an Indenture and Servicing Agreement dated as of
December 14, 1999 (the "Original Indenture"), as amended by the First Amendment
to Indenture and Servicing Agreement dated as of September 22, 2000 (the "First
Amendment" and together with the Original Indenture, collectively, the
"Indenture and Servicing Agreement") relating to the Midland Receivables-Backed
Notes, Series 1999-1;
WHEREAS, the Issuer, the Servicer, the Trustee, the Backup Servicer, the
Note Insurer and the Noteholders desire to make certain amendments to the
Indenture and Servicing Agreement;
WHEREAS, the Noteholders are the only holders of the Notes issued by the
Issuer pursuant to the Indenture and Servicing Agreement on the date hereof; and
WHEREAS, Section 12.01 of the Indenture and Servicing Agreement permits
amendment of the Indenture and Servicing Agreement on the terms and subject to
the conditions provided therein.
NOW, THEREFORE, in consideration of the mutual agreements herein contained,
each party agrees as follows for the benefit of the other parties and the
Noteholders to the extent provided herein:
ARTICLE I
AMENDMENTS
SECTION 1. Amendments to Indenture and Servicing Agreement. Subject to the terms
and conditions set forth herein, the Indenture and Servicing Agreement is
amended, as of the Amendment Effective Date, as follows:
(a) Each reference to "Asset Guaranty Insurance Company" in the Indenture
and Servicing Agreement shall be read and construed as a reference to
"Radian Asset Assurance Inc.".
(b) Each reference to "Ernst & Young LLP" in the Indenture and Servicing
Agreement shall be read and construed as a reference to "BDO Xxxxxxx,
LLP Accountants and Consultants".
(c) Section 1.01 is amended as follows:
(i) The definition of "Liquidity" is deleted in its entirety.
(ii) The definition of "Net Proceeds" is amended by:
(A) deleting the last sentence thereof in its entirety; and
(B) adding the following proviso immediately prior to the end of
the first sentence thereof:
";provided, however, that no proceeds from the sale
of accounts pursuant to Section 3.13(b), Net Seller
Recoveries or, unless specifically provided in the
definition of Servicing Fee, Capital One Net Proceeds
shall be considered Net Proceeds for purposes of
computing the Servicing Fee.".
(iii)The definition of "Permitted Third Party" is amended by deleting
the phrase "; and (iii)" and replacing it with the following
phrase:
",(iii) solely with respect to, and for the original term of, the
Approved Capital One Program, Capital One and (iv)".
(iv) The definition of "Servicing Fee" is amended by:
(A) deleting the phrase "or (B)" from the first sentence thereof
and replacing it with the following phrase:
", (B) Capital One Net Proceeds or (C)";
(B) deleting the word "and" from the first sentence thereof; and
(C) inserting the following clause immediately prior to the end
of the first sentence thereof:
" and (iii) (A) in respect of any related time period
occurring (1) after the aggregate of all Combined Capital
One Net Proceeds collected, received or otherwise recovered
shall exceed the Combined Capital One Initial Specified
Amount and (2) before the aggregate of all Combined Capital
One Proceeds collected, received or otherwise recovered
shall exceed the Combined Capital One Subsequent Specified
Amount, [***]% of all 99-1 Capital One Net Proceeds
collected, received or otherwise recovered during such
related time period and (B) in respect of any related time
period occurring after the aggregate of all Combined Capital
One Proceeds collected, received or otherwise recovered
shall exceed the Combined Capital One Subsequent Specified
Amount, [***]% of all 99-1 Capital One Net Proceeds
collected, received or otherwise recovered during such
related time period.".
(v) The definition of "Third-Party Costs" is amended by inserting the
following phrase, immediately after the phrase "Permitted Third
Party":
", other than Capital One,".
(vi) The following defined terms are incorporated therein, in
appropriate alphabetical order:
"'Approved Capital One Program' means the program entered and
performed by the Servicer and Capital One pursuant to and in
accordance with the Capital One Balance Transfer Agreement."
"'Capital One' means Capital One Bank, a Virginia banking corporation."
"'Capital One Balance Transfer Agreement' means the Credit Card
Balance Transfer Program Agreement dated July 31, 2002 entered
into between the Servicer and Capital One, solely in respect of
the Specified Receivables, substantially in the form attached
hereto as Exhibit B, without giving effect to any amendment,
supplement, restatement, waiver or modification thereof or
thereto unless consented to by the Controlling Party."
"'Capital One Balance Transfer Agreement Termination Date' means
April 30, 2003, unless otherwise agreed in writing by the
Controlling Party."
"'Capital One Subsequent Specified Amount' has the meaning set
forth on Exhibit C attached hereto."
"'Capital One Up-Front Payment Amount' has the meaning set forth
on Exhibit C attached hereto."
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange
Commission.
"'Combined Capital One Initial Specified Amount' has the meaning
set forth on Exhibit C attached hereto."
"'Combined Capital One Net Proceeds' means the portion of Net
Proceeds collected received or otherwise recovered on or with
respect to a Specified Receivable or from or for the account of
the related Obligor on such Specified Receivable pursuant to the
Approved Capital One Program."
"'Fourth Amendment to 99-A Indenture' means the Fourth Amendment
to Indenture and Servicing Agreement dated as of September 30,
2002 among Midland Funding 98-A Corporation, the Trustee, the
Backup Servicer, the Servicer and the Note Insurer, without
giving effect to any amendment, supplement, restatement, waiver
or modification thereof or thereto unless consented to by the
Controlling Party."
"'99-1 Capital One Net Proceeds' means the portion of Net
Proceeds collected received or otherwise recovered on or with
respect to a Specified 99-1 Receivable or from or for the account
of the related Obligor on such Specified 99-1 Receivable pursuant
to the Approved Capital One Program."
"'99-A Receivables' shall have the meaning given to the term
"Receivables" in the 99-A Indenture."
"'Semi-Annual Determination Date' means the last day of each
December and June, commencing on December 31, 2002."
"'Servicing Period' means the period from the Amendment Effective
Date to the Capital One Balance Transfer Agreement Termination
Date and thereafter the following periods:
May 1, 2003 through October 31, 2003
November 1, 2003 through April 30, 2004
May 1, 2004 through October 31, 2004
November 1, 2004 through December 15, 2004."
"'Specified Receivables' means the Specified 99-A
Receivables and the Specified 99-1 Receivables,
collectively."
"'Specified 99-1 Receivables' means the Receivables
identified by pool identification number and outstanding
balance on a computer tape delivered to the Note Insurer on
the date of this Second Amendment."
"'Specified 99-A Receivables' means the 99-A Receivables
identified by pool identification number and outstanding
balance on a computer tape delivered to the Note Insurer on
the date of the Fourth Amendment to 99-A Indenture."
(d) Section 3.03 is amended by:
(i) deleting paragraph (b) in its entirety and replacing it with the
following:
"(b) Exercise of Rights Under the Capital One Balance Transfer
Agreement. The Servicer hereby covenants to exercise its rights
under the Capital One Balance Transfer Agreement and take such
other action in connection with the Approved Capital One Program
and the Receivables subject thereto as may be reasonably
requested by the Trustee or as the Servicer itself reasonably
determines may be appropriate or desirable, taking into account
the associated costs, to maximize the collection of amounts
payable in respect of the Specified Receivables thereunder and
otherwise protect the rights and interests of the Noteholders,
the Note Insurer and the Trustee in the Specified Receivables.";
and
(ii) adding the following paragraphs (c), (d) and (e), immediately after
Section 3.03(b):
"(c) Receivables Subject to the Capital One Balance Transfer
Agreement. No Receivables other than the Specified Receivables
shall be or become subject to the Capital One Balance Transfer
Agreement without the prior written consent of the Controlling
Party.
(d) Proceeds in Respect of Specified 99-1 Receivables. All proceeds
collected, received or recovered in respect of any Specified 99-1
Receivable and all other amounts received pursuant to the Capital
One Balance Transfer Agreement shall be remitted by the Servicer
to the Collection Account on the Business Day immediately
following the collection, receipt or recovery by the Servicer of
such proceeds and/or other amounts.
(e) Bookkeeping and Reporting in Respect of Specified 99-1
Receivables.
(i) The Servicer shall maintain such accurate and complete
books, accounts and records as shall enable the Servicer,
the Trustee and the Note Insurer to (A) identify and
segregate the Specified 99-1 Receivables and all proceeds,
collections and recoveries in respect thereof from any other
receivables or proceeds, collections or recoveries in
respect of other receivables and from any assets of the
Servicer and (B) otherwise comply with this Second Amendment
and the Indenture and Servicing Agreement.
(ii) On or before 11:00 a.m. New York, New York time on each
Tuesday commencing November 19, 2002 during the term of the
Capital One Balance Transfer Agreement, the Servicer shall
deliver to the Trustee and to the Note Insurer a weekly
report in respect of the immediately preceding week executed
by a Responsible Officer of the Servicer substantially in
the form attached hereto as Exhibit 3.03(e) (the "Capital
One Weekly Servicing Report").
(iii)The Servicer shall deliver to the Note Insurer and the
Trustee, promptly after having obtained knowledge thereof,
but in no event later than two (2) Business Days thereafter,
an Officer's Certificate specifying the nature and status of
any default, breach, or other occurrence under or in
connection with the Capital One Balance Transfer Agreement
which could reasonably be expected to have a material
adverse effect on the rights or interests of the Note
Insurer, any Noteholder or the Trustee.
(iv) The Servicer shall deliver to the Note Insurer within thirty
(30) days after the Capital One Balance Transfer Agreement
Termination Date, a computer tape identifying by pool
identification number and outstanding balance the Specified
99-1 Receivables which remain subject to the Indenture and
Servicing Agreement.".
(e) Exhibit 3.03(e) attached hereto is hereby attached to and made a part
of the Indenture and Servicing Agreement.
(f) Section 3.08 is amended by inserting the following phrase in the second
sentence thereof, immediately after the existing phrase "each
subsequent reporting period is each subsequent calendar quarter
thereafter":
", through December 31, 2001, and thereafter the reporting
period shall be each subsequent six-month period".
(g) Section 3.09 is amended by (i) deleting the heading of such section in
its entirety and replacing it with the following: "Semi-Annual
Servicer's Compliance Report", and (ii) deleting the phrase "within
thirty days after the end of each calendar quarter of each year,
beginning with the calendar quarter ending in March 31, 2000, or more
or less frequently pursuant to the written direction of the Note
Insurer, but in no event more frequently than monthly, a report
concerning the activities of the Servicer during the preceding calendar
quarter" from the first sentence thereof and replacing it with the
following:
"on the dates set forth in the table below, or more or less
frequently pursuant to the written direction of the Note
Insurer, but in no event more frequently than monthly, a
report concerning the activities of the Servicer during the
period set forth in the table below:
Reporting Date Reporting Period
September 30, 2002 January 1, 2002 through June 30, 2002
March 31, 2003 July 1, 2002 through December 31, 2002
September 30, 2003 January 1, 2003 through June 30, 2003
March 31, 2004 July 1, 2003 through December 31, 2003
September 30, 2004 January 1, 2004 through June 30, 2004
March 31, 2005 July 1, 2004 through December 15, 2004".
(h) Section 3.13(b) is amended by:
(i) deleting the reference to "Exhibit 3.13(b)" from the second sentence
thereof and replacing it with a reference to "Exhibit 3.13(b)(i)"; and
(ii) adding the following sentence, immediately prior to the last sentence
thereof:
"The Servicer shall deliver to the Controlling Party no later than
five (5) Business Days following the date of such sale, an Officer's
Certificate in the form of Exhibit 3.13(b)(ii).".
(i) Exhibit 3.13(b) is amended by:
(i) deleting the heading thereto in its entirety and replacing it with the
heading "Exhibit 3.13(b)(i)"; and
(ii) adding the following paragraph, immediately after paragraph 8:
"9. Attached as Exhibit E hereto is a revised pay-off forecast for the
Notes (calculated assuming the sale of the Sale Receivables at the
price and on the date stated herein).".
(j) Exhibit 3.13(b)(ii) attached to this Second Amendment is hereby
attached to and made a part of the Indenture and Servicing Agreement.
(k) Section 3.13 is amended by adding the following paragraph (c)
immediately after Section 3.13(b):
"(c) The Servicer may purchase Receivables in arm's length transactions
pursuant to a sale agreement in the form attached hereto as Exhibit
3.13(c)(i) and solely for the purpose of facilitating a contemporaneous
sale of such Receivables that complies with the requirements of Section
8.07(c) and the first and last sentences of Section 3.13(b) of the
Indenture and Servicing Agreement, upon receipt of the prior written
consent from the Controlling Party; provided, that in respect of each such
sale of Receivables to the Servicer (each such sale, a "Specified Sale" and
the Receivables sold pursuant to a Specified Sale, the "Specified Sale
Receivables") the Servicer shall sell all of the related Specified Sale
Receivables (i) within one (1) Business Day of such Specified Sale, (ii) in
compliance with the requirements of Section 8.07(c) and the first and last
sentences of Section 3.13(b) of the Indenture, and (iii) for an amount
equal to that which the Servicer paid for such Specified Sale Receivables.
The Servicer shall deliver to the Controlling Party no later than five (5)
Business Days preceding the date of such proposed Specified Sale, an
Officer's Certificate in the form of Exhibit 3.13(c)(ii). The Controlling
Party shall within five (5) Business Days of receipt of the foregoing
notice advise the Servicer and the Trustee of its consent or withholding of
consent to the proposed Specified Sale. The Servicer shall deliver to the
Controlling Party no later than five (5) Business Days following the date
of such Specified Sale, an Officer's Certificate in the form of Exhibit
3.13(c)(iii). The Net Proceeds of all Specified Sales must be in
immediately available funds.".
(l) Exhibits 3.13(c)(i), 3.13(c)(ii) and 3.13(c)(iii) attached to this Second
Amendment are hereby attached to and made a part of the Indenture and
Servicing Agreement.
(m) Section 4.03(b) is deleted in its entirely and replaced with the following:
"(b) The following deposits shall be made to the Note Payment Account, as
applicable: (i) the Issuer shall remit the Redemption Amount pursuant to
Section 11.02, (ii) the Note Insurer shall remit any required payment
pursuant to the Policy and (iv) the Trustee shall transfer all Available
Funds from the Collection Account to the Note Payment Account on the
Business Day prior to each Payment Date.".
(n) Section 4.04(b)(x)(E) is amended by inserting the following phrase,
immediately after to the phrase "to the Issuer":
", unless otherwise provided under Section 12.12".
(o) Section 4.05(b)(y) is amended by inserting the following phrase,
immediately after the phrase "released from the lien of the Trust Estate
and paid to the Issuer":
", unless otherwise provided under Section 12.12".
(p) Section 4.05(d) is deleted in its entirety and replaced with the following
paragraph:
"(d) In addition to the remittances by the Trustee on each Payment Date
from the Reserve Account described in Section 4.05(b) above, the Trustee
shall, on each Payment Date, withdraw from the Reserve Account, and remit
to the Noteholders, pro-rata, based on their respective Note Balances, the
amount by which the amount on deposit in the Reserve Account exceeds the
Required Reserve Amount (after giving effect to (i) all amounts deposited
in the Reserve Account from other sources on or before such Payment Date
and (ii) all distributions otherwise required to be made from the Reserve
Accounts or the Note Payment Account on such Payment Date in accordance
herewith), which remittance shall be applied, ratably, in reduction of the
then outstanding Note Balance.".
(q) Section 4.06(a) is deleted in its entirety and replaced with the following
paragraph:
"(a) Pursuant to Section 4.01, the Trustee shall establish and maintain the
Note Payment Account which shall be an Eligible Account, for the benefit of
the Noteholders and the Note Insurer. The Note Payment Account shall be
funded to the extent that (x) the Issuer shall remit the Redemption Amount
pursuant to Section 11.02, (y) the Note Insurer shall remit any required
payment pursuant to the Policy, or (z) the Trustee shall remit the
Available Funds from the Collection Account pursuant to Section 4.03.
(r) Section 8.07(b) is deleted in its entirety and replaced with the following
paragraph:
"(b) Outside Parties. The Servicer will not engage any outside parties for
the collection or servicing of Receivables (including, without limitation,
any activities in respect of Receivables of the nature described in the
Capital One Balance Transfer Agreement) on any basis except Permitted Third
Parties.".
(s) Section 9.01(a) is amended by inserting the following phrase, immediately
after the phrase "the Monthly Servicer Report for the related Collection
Period":
", the weekly Capital One Servicing Report for the immediately preceding
week or the Semi-Annual Servicer's Compliance Report for the related
Reporting Period".
(t) Section 9.01(f) is amended by deleting the phrase "the amount set forth on
Exhibit 9.01(f) attached hereto for the applicable period" and replacing it
with "$5,000,000."
(u) Exhibit 9.01(f) is deleted in its entirety.
(v) Section 9.01(h) is deleted in its entirety and replaced with the following
paragraph:
"(h) as of (i) any Semi-Annual Determination Date, commencing with the
December 31, 2002 Semi-Annual Determination Date or (ii) the Scheduled
Termination Date, the Note Balance is greater than the amount specified in
Exhibit 9.01(h) for such date; or".
(w) Exhibit 9.01(h) is deleted in its entirety and replaced with Exhibit
9.01(h) attached to this Second Amendment.
(x) Section 9.01(m) is deleted in its entirety.
(y) Section 9.01 is amended by:
(i) adding the following paragraph (o), immediately after Section 9.01(n):
"(q) the Servicer shall fail to duly observe or perform any of its
covenants, obligations or agreements set forth in the Capital One
Balance Transfer Agreement and such failure could reasonably be
expected to have a material adverse effect on the rights or interests
of the Note Insurer, the Noteholders, the Trustee or the Trust Estate;
or", and
(ii) adding the following paragraph (p), immediately after Section 9.01(o):
"(r) the Servicer shall agree to any amendment, supplement,
restatement, waiver or modification of the Capital One Balance
Transfer Agreement without the prior written consent of the
Controlling Party (which consent shall not be unreasonably
withheld).".
(z) Section 9.02(a) is amended by:
(i) deleting clause (ii) of the first sentence thereof in its entirety and
replacing it with the following clause:
"(ii) the last day of each Servicing Period, unless the Servicer has
been appointed by the Controlling Party, on or prior to the 30th day
immediately preceding the last day of such Servicing Period, for the
next succeeding Servicing Period.";
(ii) deleting the phrase "If the Controlling Party does not appoint the
Servicer to a successive Collection Period by the first day of the
immediately preceding Collection Period, at the end of the Collection
Period through which the Servicer has previously been appointed," from
the third sentence thereof in its entirety and replacing it with the
following phrase:
"If the Controlling Party does not appoint the Servicer to a
successive Servicing Period by the 30th day immediately preceding the
last day of the existing Servicing Period, at the end of the Servicing
Period through which the Servicer has previously been appointed,"; and
(iii)deleting the phrase "On or after the receipt by the Servicer of such
written notice," from the fifth sentence thereof in its entirety and
replacing it with the following phrase:
"On or after the receipt by the Servicer of written notice of
termination, or, if earlier, upon the automatic termination of the
rights and obligations of the Servicer in accordance with the terms of
this Section,".
(aa) Section 9.02(b) is amended by deleting the phrase "or if the Controlling
Party does not appoint the Servicer to a successive quarterly term," in its
entirety and replacing it with the following phrase:
"or, if earlier, upon the automatic termination of the rights and
obligations of the Servicer in accordance with the terms of paragraph
(a) above,".
(bb) Section 9.02 is amended by:
(i) adding the following paragraph (c), immediately after Section 9.02(d):
"(c) Promptly upon the occurrence of an Event of Default or Servicer
Default or, if earlier, upon the automatic termination of the rights
and obligations of the Servicer in accordance with the terms of
paragraph (a) above, the Servicer shall deliver all material, data,
back-up files, software, licenses, and all other information relating
to the Receivables, in its control, which may be necessary or
convenient for the collection of the Receivables by a party other than
Midland Credit Management, Inc. to the Back-up Servicer, the Successor
Servicer or the Note Insurer, as the Controlling Party may direct in
writing to the Servicer."; and
(ii) adding the following paragraph (d), immediately after Section 9.02(c):
"(d) In addition to the remedial provisions set forth in clause (a)
above, and not by way of limitation of any remedies to which any of
the Trustee, the Note Insurer or the Noteholders are entitled upon the
occurrence of a Servicer Default, the Servicer acknowledges and agrees
that, upon the occurrence of a Servicer Default pursuant to Section
9.01(h), the Servicing Fee shall automatically be reduced for the
Servicing Period immediately following the date of the occurrence of
such Servicer Default (i) in respect of Net Proceeds, from [***]% to
[***]% and (ii) in respect of 99-1 Capital One Net Proceeds, from
[***]% to [***]% and [***]% to [***]%, as applicable; provided that no
such reduction in Servicing Fee incurred by a Servicer shall apply to
its Successor Servicer.".
(iii)adding the following paragraph (e), immediately after Section
9.02(d):
"(e) Notwithstanding any termination of Midland as Servicer prior to
the Capital One Balance Transfer Agreement Termination Date, if
Capital One shall not consent to the replacement of Midland under, or
the early termination of, the Capital One Balance Transfer Agreement,
Midland (i) may continue to act as Servicer solely in respect of the
Specified 99-1 Receivables and to receive that portion of the
Servicing Fee related solely to such Specified 99-1 Receivables and
(ii) shall remain bound by the terms and provisions of the Indenture
and Servicing Agreement, in its individual capacity and as Servicer,
until the Capital One Balance Transfer Agreement Termination Date;
provided, that Midland agrees that if it is terminated as Servicer
following a Servicer Default or if its rights and
[***] Omitted pursuant to a request for confidential treatment. The omitted
material has been filed separately with the Securities and Exchange Commission.
obligations as Servicer are automatically terminated in accordance
with Section 9.02(a), it shall cooperate in any negotiations of the
Trustee and/or the Controlling Party with Capital One for the
replacement of Midland under, or the early termination of, the Capital
One Balance Transfer Agreement.
(cc) Section 9.03 is amended by inserting the following phrase, immediately
after the phrase "On and after the time the Servicer receives a notice of
termination pursuant to Section 9.02 or tenders its resignation pursuant to
Section 8.05,":
"or, if earlier, upon the automatic termination of the rights and
obligations of the Servicer in accordance with the terms of Section
9.02(a),".
(dd) Section 9.08 is amended by adding the following paragraph (k), immediately
after Section 9.08(j):
"(k) the Capital One Up-Front Payment Amount shall not have been deposited
in the Collection Account within two (2) Business Days of the execution of
this Second Amendment.
(ee) Article XI is amended by adding the following Section 11.04, immediately
after Section 11.03:
"Section 11.04 Surrendering of Notes. Each Noteholder shall surrender its
Note within fourteen (14) days after receipt of the final payment due in
connection therewith. Each Noteholder, by its acceptance of the final
payment with respect to its Note, will be deemed to have relinquished any
further right to receive payments under this Agreement and any interest in
the Trust Estate. Each Noteholder shall indemnify and hold harmless the
Issuer, the Trustee, the Note Insurer and any other Person against whom a
claim is asserted in connection with such Noteholder's failure to tender
the Note to the Trustees for cancellation.";
(ff) Exhibit A is deleted in its entirety and replaced with Exhibit A attached
hereto.
(gg) Exhibit B attached to this Second Amendment is hereby attached to and made
a part of the Indenture and Servicing Agreement.
(hh) Exhibit C attached to this Second Amendment is hereby attached to and made
a part of the Indenture and Servicing Agreement.
ARTICLE II
MISCELLANEOUS
SECTION 1. Effectiveness of Second Amendment; Conditions Precedent. This Second
Amendment shall become effective upon the satisfaction of the following
conditions precedent (such date, the "Amendment Effective Date"):
(a) each of the parties to this Second Amendment shall have received fully
executed counterparts of this Second Amendment;
(b) the Trustee and the Controlling Party shall have received a fully
executed copy of (i) the Capital One Balance Transfer Agreement and
(ii) each of the other documents, instruments and agreements entered
into in connection with the Capital One Balance Transfer Agreement,
which agreements shall be in form and substance satisfactory to the
Controlling Party;
(c) the Trustee shall have furnished written notification of the substance
of this Second Amendment to the Rating Agency and the Placement Agent;
and
(d) other than the Events of Default and Servicer Defaults waived pursuant
to the Eighth Waiver to Indenture and Servicing Agreement dated of
even date herewith among the Trustee, the Servicer and the Note
Insurer, no event or condition shall have occurred and be continuing,
or would result from the execution, delivery or performance of this
Second Amendment, that would constitute an Event of Default or a
Servicer Default, and the Trustee, the Controlling Party and each of
the Noteholders shall have received a certificate of an authorized
officer of the Servicer to such effect.
SECTION 2. Appointment. Midland is appointed as Servicer for the term commencing
on the Effective Date and extending to the Capital One Balance Transfer
Agreement Termination Date.
SECTION 3. Amendment. This Second Amendment shall
only be amended in accordance with the provisions of Section 12.01 of the
Indenture and Servicing Agreement.
SECTION 4. Reference to and Effect on Agreement.
(a) Upon the Amendment Effective Date:
(i) each reference in the Indenture and Servicing Agreement to "this
Agreement", "hereunder", "hereof" or words of like import shall
mean and be a reference to the Indenture and Servicing Agreement,
as amended hereby; and
(ii) each reference to the Indenture and Servicing Agreement in the
other Transaction Documents and in any other documents,
instruments and agreements executed and/or delivered in
connection therewith, shall mean and be a reference to the
Indenture and Servicing Agreement as amended hereby.
(b) Except as expressly amended hereby, the terms and conditions of the
Indenture and Servicing Agreement, of all of the other Transaction
Documents and of any other document, instrument or agreement executed
in connection herewith or therewith, shall remain in full force and
effect and are hereby ratified and confirmed.
(c) The execution, delivery and effectiveness of this Second Amendment
shall not operate as a waiver of any right, power or remedy of any of
the parties hereto under the Indenture and Servicing Agreement or any
other Transaction Document or any other document, instrument or
agreement executed in connection herewith or therewith.
SECTION 5. GOVERNING LAW; WAIVER OF JURY TRIAL. THIS SECOND AMENDMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES UNDER THIS SECOND
AMENDMENT SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS, INCLUDING SECTION
5-1401 OF THE GENERAL OBLIGATION LAW OF NEW YORK, BUT OTHERWISE WITHOUT REGARD
TO CONFLICT OF LAWS PROVISIONS. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH
OF THE PARTIES HERETO WAIVES ANY RIGHT TO HAVE A JURY PARTICIPATE IN RESOLVING
ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT, OR OTHERWISE BETWEEN THE
PARTIES HERETO ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL TO THE
RELATIONSHIP BETWEEN ANY OF THEM IN CONNECTION WITH THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY. INSTEAD, ANY SUCH DISPUTE RESOLVED IN COURT
WILL BE RESOLVED IN A BENCH TRIAL WITHOUT A JURY.
SECTION 6. Severability of Provisions; Counterparts. If any one or more of the
covenants, agreements, provisions or terms of this Second Amendment shall be for
any reason whatsoever held invalid or unenforceable in any jurisdiction, then
such covenants, agreements, provisions or terms shall be deemed severable from
the remaining covenants, agreements, provisions or terms of this Second
Amendment and shall in no way affect the validity or enforceability of the other
provisions of this Second Amendment or the Notes, or the rights of the
Noteholders. This Second Amendment may be executed simultaneously in any number
of counterparts, each of which shall be deemed to be an original, and all of
which shall constitute but one and the same instrument.
SECTION 7. Note Insurer. This Second Amendment is not evidence of any position
by the Note Insurer, affirmative or negative, as to whether action by the
Noteholders, or any other party, is required in addition to the execution of
this Second Amendment by the Note Insurer. No representation is made by the Note
Insurer as to the necessity for or the satisfaction of any additional action or
condition under the Indenture with respect to the amendment thereof. This Second
Amendment does not modify the obligations of the Note Insurer under the Policy
as set forth therein.
SECTION 8. Representations, Warranties and Covenants. Each of the Issuer and the
Servicer hereby:
(a) reaffirms all covenants, representations and warranties made by it in
the Indenture and Servicing Agreement;
(b) agrees that all such covenants, representations and warranties shall
be deemed to have been remade as of the date of this Second Amendment;
and
(c) represents and warrants that this Second Amendment constitutes its
legal, valid and binding obligation, enforceable against it in
accordance with its terms.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
[Second Amendment to Indenture - Signature Page]
IN WITNESS WHEREOF, the parties have caused this Second Amendment to be
duly executed by their respective officers as of the day and year first above
written.
MIDLAND RECEIVABLES 99-1 CORPORATION,
as Issuer
By:____/s/ Xxxx X. Xxxxxxx, III_____
Name: Xxxx X. Xxxxxxx, III
Title: President
MIDLAND CREDIT MANAGEMENT, INC.,
as Servicer
By:____/s/ Xxxx X. Xxxxxxx, III_____
Name: Xxxx X. Xxxxxxx, III
Title: President & CEO
XXXXX FARGO BANK MINNESOTA, not in
its individual capacity, but solely
as Trustee and as Backup Servicer
By:___/s/ Xxxxxxx Matyi______________
Name: Xxxxxxx Xxxxx
Title: Assistant Vice President
RADIAN ASSET ASSURANCE INC.,
as Note Insurer
By:____/s/ Xxxxxxxxx Xxxxxxx ________
Name: Xxxxxxxxx Xxxxxxx
Title: VP, Risk Management
NM ROTHSCHILD & SONS (AUSTRALIA)
LIMITED, as a Noteholder
By:__________________________________
Name:
Title:
PFL LIFE INSURANCE COMPANY, as a
Noteholder
By:_____/s/ Xxxx Podhajsky___________
Name: Xxxx X. Xxxxxxxxx
Title: Vice President
LIFE INVESTORS INSURANCE COMPANY OF
AMERICA, as a Noteholder
By:_____/s/ Xxxx Podhajsky___________
Name: Xxxx X. Xxxxxxxxx
Title: Vice President
RELIANCE STANDARD LIFE INSURANCE
COMPANY, as a Noteholder
By:__________________________________
Name:
Title: