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EXHIBIT 10.4

CHARMING SHOPPES MASTER TRUST
 
SERIES 1999-2 PAYOFF AND RELEASE AGREEMENT
 

 
Dated as of October 25, 2009
 

 
among
 
SPIRIT OF AMERICA, INC.,
 
as Servicer
 
CHARMING SHOPPES RECEIVABLES CORP.,
 

 
as Seller and Class B Purchaser,
 

 
CLIPPER RECEIVABLES COMPANY, LLC,
 
as the Class A Purchaser,
 

 
STATE STREET BANK AND TRUST COMPANY (as successor to State Street Global
Markets, LLC)
 
as Administrator for the Class A Purchaser
 

 
and
 

 
U.S. BANK NATIONAL ASSOCIATION,
 
as Trustee
 

 

 
 

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SERIES 1999-2 PAYOFF AND RELEASE AGREEMENT (the “Agreement”), dated as of
October 25, 2009, among SPIRIT OF AMERICA, INC., as Servicer  (the “Servicer”),
CHARMING SHOPPES RECEIVABLES CORP., as Seller and Class B Purchaser (in such
capacities, the “Seller” or the “Class B Purchaser”), CLIPPER RECEIVABLES
COMPANY, LLC, as the Class A Purchaser (the “Class A Purchaser”), STATE STREET
BANK AND TRUST COMPANY (as successor to State Street Global Markets, LLC), as
Administrator for the Class A Purchaser (the Administrator”) and U.S. BANK
NATIONAL ASSOCIATION, as Trustee of the Charming Shoppes Master Trust (the
“Trustee”).
 
WHEREAS, the Seller, the Servicer, the Class A Purchaser and the Administrator
are parties to that certain Certificate Purchase Agreement, dated as of May 28,
1999 (as amended, the “Certificate Purchase Agreement”);
 
WHEREAS, the Servicer and the Trustee are parties to that Series 1999-2
Supplement, dated as of May 28, 1999 (as amended, the “Supplement”), to the
Second Amended and Restated Pooling and Servicing Agreement, dated as of
November 25, 1997 (as amended, the “PSA”).
 
WHEREAS, the Seller desires to cause the entire amount of the Class A Investor
Interest to be prepaid in full; and
 
WHEREAS, the Class A Purchaser and the Administrator have consented to such
prepayment.
 
NOW THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties agree as follows:
 
1.             DEFINITIONS
 
Capitalized terms used but not defined herein shall have the meanings given such
terms in the Supplement (as defined herein).  For purposes of this Agreement,
the following terms shall have the meanings given them below:
 
“Accounts Purchase Agreement” means the purchase agreement, dated as of August
12, 2009 among the Servicer, Spirit of America, Inc. and the Seller, as seller
parties, and World Financial Network National Bank, as purchaser.
 
“Payoff Amount” means the sum of the following amounts: (i) the Investor
Interest, plus (ii) accrued and unpaid interest on the Investor Interest through
the Payoff Date, plus (iii) the accrued and unpaid Non-Use Fees and Class A
Additional Amounts in respect of the Class A Investor Interest through the
Payoff Date, plus (iv) $78,493.88, representing the present value of the Non-Use
Fee from the date of this Agreement to the termination of the commitment under
the Certificate Purchase Agreement.
 
“Payoff Date” means October 30, 2009 or such later date as is designated in
writing to the parties hereto by the Servicer; provided, however, it is
understood and agreed that (i) the Payoff Date shall not be a Distribution Date
and (ii) the Payoff Date shall not occur prior to consummation of the
transactions contemplated by the Accounts Purchase Agreement.
 

 
 

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2.             THE PAYOFF AND TERMINATION
 
SECTION 2.1 Termination of Obligations.  Subject to the terms and conditions of
this Agreement, each of the Trustee and the Class A Purchaser acknowledges and
agrees that, following receipt by the Administrator of the Payoff Amount on the
Payoff Date, (i) the Supplement, the Certificate Purchase Agreement and the Fee
Letter shall be terminated and (ii) neither the Seller nor the Servicer shall
have any further obligations with respect to the Supplement, the Certificate
Purchase Agreement, the Fee Letter or the Series 1999-2 Certificates, except for
obligations that, by the terms of the Certificate Purchase Agreement survive the
termination thereof.
 
SECTION 2.2 Waiver; Calculation of Payoff Amount; True-Up.
 
(a) The parties hereto agree to waive the refinancing provisions of Section 4(c)
of the Supplement.
 
(b) No later than 2:00 p.m. New York time two Business Days prior to the Payoff
Date, the Seller (or the Servicer on its behalf) shall request the Administrator
to provide it with the Payoff Amount.
 
(c) Within one Business Day following receipt of the notice described in Section
2.2(b) hereof, the Administrator shall deliver to the Servicer, the Seller, and
the Class A Purchaser a statement of the Payoff Amount and the calculation of
the Payoff Amount and, in reasonable detail, the manner in which such amounts
were determined.
 
(d) On the Payoff Date, the Seller shall cause the Servicer or its designee to
transfer the Payoff Amount distributed on the Payoff Date to the Trustee for
payment to the Administrator in immediately available funds.  Upon receipt by
the Administrator of the Payoff Amount, the Administrator shall deliver the
Investor Certificates representing the Class A Investor Interest (the “Class A
Certificates”) to the Trustee for cancellation.
 
3.             REPRESENTATIONS AND WARRANTIES OF ADMINISTRATOR AND CLASS A
PURCHASER
 
SECTION 3.1 Absence of Liens.  Each of the Administrator and the Class A
Purchaser represents and warrants to the Servicer, the Seller and the Trustee
that at the time of delivery of the Class A Certificates to the Trustee
described in Section 2.2(d), the Class A Certificates shall not be subject to
any lien, pledge or encumbrance created by the Administrator or the Class A
Purchaser.
 
4.             CONDITION PRECEDENT
 
SECTION 4.1 Consummation of the Accounts Purchase Agreement.  It shall be a
condition precedent to requirement to transfer the Payoff Amount under Section
2.2(d) hereof that the transactions contemplated by the Accounts Purchase
Agreement be consummated on the Payoff Date.  If the Servicer does not timely
pay the Payoff Amount to the Administrator on the Payoff Date as required by
Section 2.2(d) and the other provisions hereof, then the Seller shall
 

 
 

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cause the Servicer to make an additional payment equal to the interest on the
delinquent and unpaid Payoff Amount (or any applicable portion thereof) from the
date such payment was due until either (i) such amount is paid in full or (ii)
the Business Day following the first Business Day on which the Servicer shall
have irrevocably notified the Administrator that the transactions contemplated
by the Accounts Purchase Agreement will not be consummated, in either case at a
rate equal to the Class A Purchaser’s cost of funds as determined in a
commercially reasonable manner by the Administrator and certified to the
Servicer.  For the avoidance of doubt, if the transactions contemplated by the
Accounts Purchase Agreement are not consummated, the Payoff Amount shall not be
due.
 
5.             MISCELLANEOUS
 
SECTION 5.1 Further Assurances.  Each of the Class A Purchaser and the
Administrator agrees, at the Seller’s expense, to promptly execute and deliver
all further instruments and documents, and to take all further actions, that may
be necessary or desirable, or that the Seller may reasonably request, to carry
out the terms of the Agreement.
 
SECTION 5.2 Governing Law.  THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK WITHOUT REFERENCE TO ITS CONFLICT OF LAW
PROVISIONS, AND THE OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER
SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.
 
SECTION 5.3 No Petition.  (a)  The Seller, the Servicer, the Trustee, the Class
B Purchaser, the Class A Purchaser and the Administrator, by entering into this
Agreement, hereby covenant and agree that they will not at any time institute
against the Trust, or join in any institution against the Trust of, any
bankruptcy proceedings under any United States Federal or state bankruptcy or
similar law in connection with any obligations relating to the Investor
Certificates, this Agreement, the Certificate Purchase Agreement or the
Supplement.
 
(b) The Servicer, the Trustee, the Class A Purchaser and the Administrator
hereby covenant and agree that they will not at any time institute against the
Seller, or join in any institution against the Seller of, any bankruptcy
proceedings under any United States Federal or state bankruptcy or similar law
in connection with any obligations relating to the Investor Certificates, this
Agreement, the Certificate Purchase Agreement or the Supplement.
 
SECTION 5.4 Costs, Expenses and Taxes.  The Seller agrees to pay on demand all
reasonable costs and out-of-pocket expenses in connection with the preparation,
execution and delivery of this Agreement and the other related documents,
including, without limitation, reasonable attorney fees and expenses for the
Administrator and Class A Purchaser.
 
SECTION 5.5 Execution in Counterparts.  This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed shall be deemed to be an original and all of
which when taken together shall constitute one and the same agreement.  Delivery
of an executed counterpart of a signature page
 

 
 

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to this Agreement by facsimile shall be effective as delivery of a manually
executed counterpart of this Agreement.
 
[remainder of page left intentionally blank]
 

 
 

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IN WITNESS WHEREOF, the parties have caused this Series 1999-2 Payoff and
Release Agreement to be signed by their duly authorized officers as of the date
set forth on the cover page of this Agreement.
 

SPIRIT OF AMERICA, INC., as the Servicer
 
By:                                                                           
Name: Eric M. Specter
Title:   President
   
CHARMING SHOPPES RECEIVABLES CORP., as the Seller and Class B Purchaser
 
 
By:                                                                           
Name:  Eric M. Specter
Title:    President

 
 

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CLIPPER RECEIVABLES COMPANY, LLC, as the Class A Purchaser
   
By:                                                                           
Name:                                                                           
Title:                                                                           
   
STATE STREET BANK AND TRUST COMPANY,
as Administrator for the Class A Purchaser
   
By:                                                                           
Name:                                                                           
Title:                                                                           

 
 

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U.S. BANK NATIONAL ASSOCIATION, not in its individual capacity but solely as the
Trustee for CHARMING SHOPPES MASTER TRUST
   
By:                                                                           
Name:                                                                           
Title:                                                                           

 
 

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