Exhibit 4.12


 


FORM OF RISK RETENTION
AGREEMENT, dated as of [________], 2018 (this “Agreement”), by and among SYNCHRONY
BANK, a federal savings association organized under the laws of the United States (“Synchrony Bank”),
SYNCHRONY CARD FUNDING, LLC, a Delaware limited liability company (“Synchrony Card Funding”), and SYNCHRONY
CARD ISSUANCE TRUST, a Delaware statutory trust (the “Issuer”).


 


WITNESSETH:


 


WHEREAS,
Synchrony Bank and Synchrony Card Funding have entered into an Amended and Restated Receivables Sale Agreement, dated as of May
1, 2018 (the “Receivables Sale Agreement”), pursuant to which Synchrony Bank sells Receivables arising
under certain Accounts to Synchrony Card Funding;


 


WHEREAS,
Synchrony Card Funding and the Issuer have entered into an Amended and Restated Transfer Agreement, dated as of May 1, 2018
(as amended, restated, supplemented or otherwise modified, the “Transfer Agreement”), pursuant to which Synchrony
Card Funding conveyed to the Issuer all of its right, title and interest in and to the Receivables arising under certain Accounts;


 


WHEREAS,
Synchrony Card Funding, Citibank, N.A., as the trustee (in such capacity, the “Trustee”) and Citicorp Trust
Delaware, National Association, as the Delaware trustee, have entered into an Amended and Restated Trust Agreement, dated as of
May 1, 2018 (as amended, restated, supplemented or otherwise modified, the “Trust Agreement”), pursuant
to which the Issuer issued the Transferor Interest to Synchrony Card Funding;


 


WHEREAS,
the Issuer and The Bank of New York Mellon (the “Indenture Trustee”) have entered into an Amended and Restated
Master Indenture, dated as of May 1, 2018 (as amended, restated, supplemented or otherwise modified, the “Master
Indenture”), and a SynchronySeries Indenture Supplement, dated as of [________], [____] (as amended, restated, supplemented
or otherwise modified, the “Indenture Supplement”, and together with the Master Indenture, the “Indenture”),
pursuant to which the Issuer [will issue] [has issued and may from time to time issue] the SynchronySeries Notes; and


 


WHEREAS, Synchrony Card
Funding intends to cause the Issuer to issue the Class [__]([____]-[__]) Notes pursuant to the Indenture and the Terms Document,
dated as of [____], [___] (the “Terms Document”), between the Issuer and the Indenture Trustee.


 


NOW, THEREFORE, it is
hereby agreed by and among Synchrony Bank, Synchrony Card Funding and the Issuer as follows:


 


1.           DEFINITIONS.
All capitalized terms used but not defined herein shall have the meanings given to such terms in the Terms Document and, if not
defined therein, in the Indenture. The following capitalized terms shall have the following meanings:


 


“AIFM Regulation”
means Commission Delegated Regulation (EU) No. 231/2013, as in effect as of the date hereof.


 




     


     


    

 


“Applicable
Investor” means each holder of a beneficial interest in any Class [__]([____]-[__]) Note that is (i) an EEA credit institution
or investment firm subject to the CRR, including any consolidated group affiliate thereof; (ii) an EEA insurer or reinsurer subject
to the Solvency II Regulation; or (iii) an EEA alternative investment fund manager to which the AIFM Regulation applies.


 


“CRR”
means Regulation (EU) No. 575/2013 of the European Parliament and of the Council of 26 June 2013, as supplemented by the CRR Delegated
Regulation, as in effect as of the date hereof.


 


“CRR
Delegated Regulation” means Commission Delegated Regulation (EU) No. 625/2014, as in effect as of the date hereof.


 


“EEA”
means the European Economic Area.


 


“EU Retention
Rules” means: (i) Articles 404 – 410 (inclusive) of CRR; (ii) Articles 50 – 56 (inclusive) of the AIFM Regulation;
and (iii) Articles 254 – 257 (inclusive) of the Solvency II Regulation, each as in effect as of the date hereof, together
with any guidance published in relation thereto including any regulatory and/or implementing technical standards in effect as of
the date hereof.


 


“Solvency II
Regulation” means Commission Delegated Regulation ((EU No. 2015/35), as in effect as of the date hereof.


 


2.           REPRESENTATIONS.
Synchrony Bank represents and warrants to the Issuer and the Indenture Trustee (solely for the benefit of the Applicable Investors)
that as of the date hereof:


 


(a)          Synchrony
Bank has all requisite power and authority to execute, deliver and perform its obligations under this Agreement;


 


(b)          The
execution, delivery and performance of this Agreement have been duly authorized by all necessary action, and do not violate any
provision of any law or regulation of any Governmental Authority, or contractual or other restrictions binding on Synchrony Bank,
except where such violations, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect;
and


 


(c)          This
Agreement is the valid, binding and enforceable obligation of Synchrony Bank, except as the same may be limited by applicable Debtor
Relief Laws, now or hereafter in effect, and by general principles of equity (whether considered in a suit at law or in equity).


 


3.           COVENANTS.
Synchrony Bank hereby confirms, represents and warrants to and agrees with, and irrevocably and unconditionally undertakes to the
Issuer and the Indenture Trustee, solely for the benefit of each Applicable Investor, in connection with the EU Retention Rules,
on an ongoing basis, that:


 




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(a)          Synchrony
Bank, as “originator” for the purposes of the EU Retention Rules, currently retains, and on an ongoing basis will retain,
a material net economic interest that is not less than 5% of the nominal value of the securitized exposures, in a form that is
intended to qualify as an originator’s interest as provided in option (b) of each of Article 405(1) of the CRR, Article 51(1)
of the AIFM Regulation and Article 254(2) of the Solvency II Regulation, by holding all the membership interest in Synchrony Card
Funding, which in turn holds all or part of the Transferor Interest (the “Retained Interest”);


 


(b)          Synchrony
Bank will not (and will not permit Synchrony Card Funding or any of its other affiliates to) allow the retained interest to be
subject to any credit risk mitigation, short position or other hedge or to be sold if, as a result, Synchrony Bank would not retain
a material net economic interest in an amount that is not less than 5% of the nominal value of the securitized exposures, except
to the extent permitted in accordance with Article 405(1) of the CRR (as supplemented by Article 12 of the CRR Delegated Regulation),
Article 51(1) of the AIFM Regulation and Article 254 of the Solvency II Regulation;


 


(c)          Synchrony
Bank will not change the manner in which it retains its net economic interest in the securitized exposures while the Class [__]([____]-[__])
are outstanding, except under exceptional circumstances in accordance with Article 405(1) of the CRR (as supplemented by Article
10 of the CRR Delegated Regulation), Article 51(1) of the AIFM Regulation and Article 254 of the Solvency II Regulation; and


 


(d)          Synchrony
Bank will provide ongoing confirmation of Synchrony Bank’s continued compliance with its obligations described in (a) and
(b) above in or concurrently with the delivery of each Monthly Noteholders’ Statement.


 


4.           AGREEMENTS
OF SYNCHRONY CARD FUNDING. Synchrony Card Funding hereby acknowledges the terms and conditions of this Agreement and, further,
covenants that it will not sell, hedge or otherwise mitigate its credit risk under or associated with the Retained Interest other
than as directed by Synchrony Bank and as permitted in accordance with the terms of this Agreement.


 


5.           LIMITATION
OF LIABILITY.


 


(a)          It
is expressly understood and agreed by the parties hereto that (i) this Agreement is executed and delivered by Citibank, N.A., not
individually or personally, but solely as Trustee of the Issuer, (ii) each of the representations, undertakings and agreements
herein made on the part of the Issuer is made and intended not as a personal representation, undertaking and agreement by Citibank,
N.A. but is made and intended for the purpose of binding only the Issuer, (iii) nothing herein contained shall be construed as
creating any liability on Citibank, N.A., individually or personally, to perform any covenant either expressed or implied contained
herein, all such liability, if any, being expressly waived by the parties hereto and by any Person claiming by, through or under
the parties hereto, (iv) Citibank, N.A. has made no investigation as to the accuracy or completeness of any representations and
warranties made by the Issuer or any other party in this Agreement, and (v) under no circumstances shall Citibank, N.A. be personally
liable for the payment of any indebtedness or expenses of the Issuer or be liable for the breach or failure of any obligation,
representation, warranty or covenant made or undertaken by the Issuer under this Agreement or any other related documents.


 




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(b)          Notwithstanding
anything to the contrary contained herein or in any other document or agreement relating to the Class [__]([____]-[__]) Notes,
in no event shall Synchrony Bank or Synchrony Card Funding be liable to the Indenture Trustee, the Issuer, the Trustee, any Applicable
Investor or any other Noteholder, or responsible for, losses in respect of the Class [__]([____]-[__]) Notes or any
interest therein, including, without limitation any loss of value of any Class [__]([____]-[__]) Notes or any interest therein,
due to the failure of the Retained Interest and compliance by Synchrony Bank and Synchrony Card Funding with the terms of this
Agreement to satisfy the EU Retention Rules or other similar or equivalent provisions now or hereafter in effect.


 


6.           MISCELLANEOUS.



 


(a)          THIS 
AGREEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND PERFORMANCE,
BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401(1)
OF THE GENERAL OBLIGATIONS LAW, BUT WITHOUT REGARD TO ANY OTHER CONFLICT OF LAW PROVISIONS THEREOF) AND ANY APPLICABLE LAWS OF
THE UNITED STATES OF AMERICA.


 


(b)          EACH
PARTY HERETO HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY
SHALL HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THEM PERTAINING TO THIS INDENTURE OR TO
ANY MATTER ARISING OUT OF OR RELATING TO THIS INDENTURE; PROVIDED, THAT EACH PARTY HERETO ACKNOWLEDGES THAT ANY APPEALS
FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE BOROUGH OF MANHATTAN IN NEW YORK CITY.  EACH PARTY
HERETO SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT, AND EACH PARTY
HERETO HEREBY WAIVES ANY OBJECTION THAT SUCH PARTY MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE OR FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY SUCH COURT. 
EACH PARTY HERETO HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION OR SUIT
AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED TO
SUCH PARTY AT ITS ADDRESS DETERMINED IN ACCORDANCE WITH SECTION 6(d) AND THAT SERVICE SO MADE SHALL BE DEEMED COMPLETED
UPON THE EARLIER OF SUCH PARTY’S ACTUAL RECEIPT THEREOF OR THREE DAYS AFTER DEPOSIT IN THE UNITED STATES MAIL, PROPER POSTAGE
PREPAID.  NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE LEGAL PROCESS IN ANY OTHER MANNER PERMITTED
BY LAW.


 




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(c)          BECAUSE
DISPUTES ARISING IN CONNECTION WITH COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED
AND EXPERT PERSON AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES
DESIRE THAT THEIR DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS.  THEREFORE, TO ACHIEVE THE BEST COMBINATION
OF THE BENEFITS OF THE JUDICIAL SYSTEM, THE PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING
BROUGHT TO RESOLVE ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO, OR
INCIDENTAL TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.


 


If to Synchrony
Bank:


 


777 Long Ridge Road


Stamford, Connecticut 06902


Attention: Eric Duenwald – Treasurer


 


If to Synchrony
Card Funding:


 


777 Long Ridge Road


Stamford, Connecticut 06902


Attention:  Eric Duenwald –
President


 


If to the Issuer:


 


388 Greenwich Street


New York, New York 10013


Attn:  Synchrony Card Issuance
Trust


 


(d)          Neither
this Agreement nor any term or provision hereof may be changed, waived, discharged or terminated except by a writing signed by
a duly authorized officer of the party against whom enforcement of such change, waiver, discharge or termination is sought to be
enforced.


 




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(e)          Any
part, provision, representation, warranty or covenant of this Agreement that is prohibited or is held to be void or unenforceable
shall be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof.


 


Any part, provision,
representation, warranty or covenant of this Agreement that is prohibited or is held to be void or unenforceable in any particular
jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating
the remaining provisions hereof, and any such prohibition or unenforceability in any particular jurisdiction shall not invalidate
or render unenforceable such provision in any other jurisdiction.


 


To the extent
permitted by applicable law, the parties hereto waive any provision of law which prohibits or renders void or unenforceable any
provision hereof.


 


(f)          This
Agreement constitutes the entire agreement and understanding of the parties with respect to the matters addressed herein, and this
Agreement supersedes any prior agreements and/or understandings, written or oral, with respect to such matters.


 


(g)          The
Issuer is a party to this Agreement solely for the purposes of obtaining the benefit of the representations, warranties and covenants
contained therein and under no circumstances shall it be deemed to have undertaken any obligations thereunder or by virtue of its
entry into this Agreement.


 


(h)          The
Indenture Trustee is a third party beneficiary of this Agreement solely for the purpose of obtaining the benefit of the representations,
warranties and covenants contained herein and under no circumstances shall it be deemed to have undertaken any obligations hereunder.
For the avoidance of doubt, in no event shall the Indenture Trustee have any responsibility to monitor compliance with or be charged
with knowledge of the EU Retention Rules, nor shall it be liable to any Applicable Investor, Noteholder or any party whatsoever
for any violation of such EU Retention Rules or such similar provisions now or hereafter in effect or for any breach of any term
of this Agreement.


 




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Synchrony Bank, Synchrony
Card Funding and the Issuer have caused this Agreement to be duly executed by their respective officers as of the date first above
written.


 


	 	SYNCHRONY BANK
	 	 	 	 
	 	 	By:	 
	 	 	Name:	 
	 	 	Title:	 
	 	 	 	 
	 	SYNCHRONY CARD FUNDING, LLC
	 	 	 	 
	 	 	By:	 
	 	 	Name: 	 
	 	 	Title:	 
	 	 	 	 
	 	SYNCHRONY CARD ISSUANCE TRUST
	 	 	 	 
	 	By:	Citibank, N.A., not in its individual capacity, but solely as Trustee
	 	 	 	 
	 	 	By:	 
	 	 	Name:	 
	 	 	Title: